LEASE
THIS LEASE is made this 5th day of April 2002 by and between LLL
Properties, a general partnership, whose address is 000 Xxxx Xxxx
Xxxxxx, Xxxxxx, XX ("Landlord") and Sonoma National Bank, whose address
is 000 0xx Xxxxxx, Xxxxx Xxxx, XX 00000 ("Tenant").
This Lease is made with reference to the following facts and
objectives:
A. Landlord is the owner of the premises (the "Premises"), which consist
generally, of a portion of the ground floor containing approximately
2,029 rentable square feet as shown and described in Exhibit "A". The
Premises are part of the mixed-use building at 000 Xxxx Xxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxx (the "Real Property") and are subject to improvement
by Landlord and Tenant as described in the Work Letter attached hereto
as Exhibit "B". The Real Property includes common areas that Tenant
shall have the right to use according to the terms of this Agreement.
B. Tenant is willing to lease the Premises from Landlord pursuant to the
provisions stated in this Lease.
C. Tenant wishes to lease the Premises for the purpose of operating a
bank office or any legal purpose incidental or related thereto.
D. Tenant has examined the Premises and is fully informed of their
condition.
THE PARTIES HERETO AGREE AS FOLLOWS:
1. Premises.
a. Leased Premises. Landlord hereby leases the Premises to Tenant, and
Tenant hereby hires and takes the Premises from Landlord, upon the terms
and conditions herein set forth. Tenant shall also have the
non-exclusive right to use the common areas of the building subject to
rules promulgated by Landlord from time to time.
b. Additional Space Option. If, after twenty four (24) months from the
Commencement Date, additional space on the first or second floor of the
building becomes available for lease, and if Landlord has no interest in
leasing it to a business in which Landlord has an interest, Landlord
shall first give Tenant written notice of the space availability and a
written statement of acceptable terms. Tenant shall have a period of
five (5) days from such notice within which to accept or reject
Landlord's offer to lease. If Tenant does not accept the offer, in
writing, with the five (5) day period, Landlord shall be free to offer
the space for lease, and to lease the space to any third party under
terms identical to, or more favorable to Landlord than, those offered to
Tenant.
2. Term.
a. Initial Term. The term of this Lease shall be twenty
(20) years and shall commence on June 1, 2002 (the "Commencement Date"),
and shall end on May 31, 2022.
b. Rent Commencement. Tenant shall commence paying rent,
operating costs and all other monetary obligations hereunder
(collectively "Rent") on the date that is the earlier of (i) the date
Tenant completes the Improvements, as defined in the Work Letter, and
receives authorization from the City and County of Sonoma to occupy the
Premises, or (ii) 30 days following Landlord's receipt of a certificate
of occupancy for the building from the City and County of Sonoma (Rent
Commencement Date).
x. Xxxxx in Delivery of Possession. If Landlord is unable to
deliver possession of the Premises by October 1, 2002, except where
Landlord's inability to deliver possession is caused by or contributed
to by acts of God, vandalism, or events outside of Landlord's control ,
it is specifically agreed that this Lease may be cancelled by Tenant and
the parties shall have no further liability to or on account of each
other. The preceding sentence shall not apply, and Tenant shall not
have the right to terminate the Lease in the event that acts of Tenant,
or Tenant's contractors, subcontractors, or material suppliers causes or
contributes to Landlord's inability to deliver possession by October 1,
2002.
d. Option to Renew. Provided that Tenant is not in default
under this Lease, Tenant shall have the option to extend the term on all
of the provisions contained in this Lease, except for rent, for two
separate and successive five year periods (each of which are referred to
herein as an "Extended Term") following expiration of the preceding
term, by giving notice of exercise of the option ("Option Notice") to
Landlord at least six (6) months, but not more than one (1) year, before
the expiration of the preceding term. If Tenant is in default on the
date of giving the Option Notice, the Option Notice shall be totally
ineffective. If Tenant is in default on the date the Extended Term is
to commence, the Extended Term shall not commence and this Lease shall
expire at the end of the preceding term. Tenant shall have no other
right to extend the term beyond the Extended Terms.
e. Failure to Notify. In the event Tenant fails to provide
the Option Notice to Landlord within six months of the expiration of any
term, Landlord shall notify Tenant of Landlord's intent to re-lease the
Premises. Tenant shall have 30 days from receipt of Landlord's notice
to provide the Option Notice.
f. Rent During Extended Term. The parties shall have thirty
(30) days after Landlord receives the Option Notice in which to agree on
rent during the Extended Term. If the parties agree on rent for the
Extended Term during that period, they shall immediately execute an
amendment to this Lease stating the rent.
If the parties are unable to agree on rent for the Extended
Term within that period, then within ten (10) days after the expiration
of that period each party, at its cost and by giving notice to the other
party, shall appoint a real estate appraiser with at least five (5)
years full-time commercial appraisal experience in Sonoma County to
appraise and set the monthly rent for the Extended Term ("Fair Market
Rental"). If a party does not appoint an appraiser within ten (10) days
after the other party has given notice of the name of its appraiser, the
single appraiser appointed shall be the sole appraiser and shall set the
Fair Market Rental. If the two appraisers are appointed by the parties
as stated in this paragraph, they shall meet promptly and attempt to set
the Fair Market Rental. If they are unable to agree within thirty (30)
days after the second appraiser has been appointed, they shall attempt
to elect a third appraiser meeting the qualifications stated in this
paragraph within ten (10) days after the last day the two appraisers are
given to set the Fair Market Rental. If they are unable to agree on the
third appraiser, either of the parties to this Lease may apply to the
American Arbitration Association (or any successor thereto) for the
appointment of an arbitrator in Sonoma County to act as the third
appraiser. Each of the parties shall bear one-half (1/2) of the cost of
appointing this third appraiser and of the third appraiser's fee. The
third appraiser, however selected, shall be a person who has not
previously acted in any capacity for either party.
Within thirty (30) days after the election of the third
appraiser, a majority of the appraisers shall set the Fair Market
Rental. If a majority of the appraisers are unable to set the Fair
Market Rental within this thirty (30) day period, the Fair Market Rental
shall be determined to be the average of the opinions of the two
appraisers whose estimates of Fair Market Rental are most nearly the
same.
If the Fair Market Rental has not been established by the
commencement of the Extended Term, Tenant shall continue to pay the
monthly rental in effect on the last day before the commencement of the
Extended Term and Landlord and Tenant shall adjust their accounts once
the Fair Market Rental has been established.
3. Preparation and Acceptance of Premises.
a. Condition of Premises. Tenant's taking possession of the Premises on
commencement of the term shall constitute Tenant's acknowledgment that
the Premises are in good condition.
b. Notice Regarding Hazardous Substances. This subparagraph shall
constitute Landlord's notice to Tenant pursuant to Cal. Health and
Safety Code Section 25359.7. Landlord is aware that the site of the
Building at 000 Xxxx Xxxx Xxxxxx was formerly a gasoline/service
station, and hazardous substances came to be located on or beneath the
real property. Extensive site remediation has taken place, including
removal of contaminated soil, and installation of monitoring xxxxx that
remain on the property. All relevant information relating to hazardous
substances on the property, including public agency concurrence with the
construction of the Building, can be obtained by inspecting the files of
public agencies with jurisdiction over the site, including but not
limited to files at the Sonoma County Department of Health Services,
Environmental Health Division and the San Francisco Bay Regional Water
Quality Control Board.
4. Rent.
a. Minimum Monthly Rent. Tenant shall pay to Landlord, as minimum
monthly rent, without deduction, setoff, prior notice, or demand, the
sum of Two and 70/100 Dollars ($2.70) per rentable square foot per
month, subject to adjustment as provided in Paragraph 4(b). Rentable
square footage shall be calculated in accordance with 1996 BOMA
standards and shall not be subject to revision except in connection with
an actual change in the size of the Premises. Rent shall be payable in
advance on the first day of each month, except that rent for the first
month or portion of it shall be paid on the day the term commences. All
rent shall be paid to Landlord in lawful money of the United States at
the address to which notices to Landlord are given, or at such other
address as Landlord may give Tenant in writing from time to time. If
any payment by check is refunded to Landlord because of insufficient
funds, then Landlord may at any time thereafter require any payment due
hereunder to be made by cashier's or certified check, and failure to do
so shall constitute an event of default under this Lease.
b. CPI Adjustments. The minimum monthly rent provided for in Paragraph
4(a) shall be subject to adjustment at the commencement of the third
year of the term and each year thereafter (the "adjustment date"), as
follows:
The base for computing the adjustment is the San Francisco-Oakland
Consumer Price Index for All Urban Consumers, published by the United
States Department of Labor, Bureau of Labor Statistics ("Index"), that
is published for the month in which the term commences ("Base Index").
If the index that is in effect on the adjustment date ("Extension
Index") has increased over the Base Index, the minimum monthly rent for
the following year shall be set by multiplying the minimum monthly rent
set forth in Paragraph 4(a) by a fraction, the numerator of which is the
Extension Index and the denominator of which is the Base Index. In no
case shall the minimum monthly rent be less than the minimum monthly
rent set forth in Paragraph 4(a), but in no event shall the annual
increase in rent as a result of this adjustment exceed Six Percent (6%)
in any one year. On adjustment of the minimum monthly rent as provided
in this Lease, the parties shall immediately execute an amendment to the
Lease stating the new minimum monthly rent.
If the Index is changed so that the base year differs from that used
when the term commences, the Index shall be converted in accordance with
the conversion factor published by the United States Department of
Labor, Bureau of Labor Statistics. If the Index is discontinued or
revised during the term, such other government index or computation with
which it is replaced shall be used in order to obtain substantially the
same result as would be obtained if the Index had not been discontinued
or revised. The CPI Adjustments shall continue throughout the Extended
Term.
c. Prorations. Minimum monthly rent for any partial month shall be
prorated at the rate of one-thirtieth (1/30th) of the minimum monthly
rent per day. If this Lease terminates before the expiration date for
reasons other than Tenant's default, minimum monthly rent shall be
prorated to the date of termination, and Landlord shall immediately
repay to Tenant all minimum monthly rent then prepaid and unearned, if
any.
d. Late Fee. Tenant acknowledges that Landlord will incur costs not
contemplated by this Agreement if the rent is not paid when due; the
exact amount of such damages which would be extremely difficult to
ascertain. Accordingly, if payment is not received by Landlord within
ten (10) days from when it is due, the Tenant shall pay Landlord a late
payment charge equal to Five Percent (5%) of the overdue payment. Tenant
agrees that this late charge represents the fair and reasonable estimate
of the costs Landlord will incur by reason of Tenant's late payment.
Landlord's acceptance of the late charge will not constitute a waiver by
Landlord of Tenant's default with respect to the overdue payment, nor
prevent Landlord from exercising any of the other rights or remedies
granted Landlord under this Agreement, at law, or in equity.
5. Interest on Past Due Obligations. Except as expressly provided in
this Lease, any amount not paid to Landlord when due shall bear interest
at the maximum annual rate then allowable by law from the date due until
paid. Payment of such interest shall not excuse or cure any default by
Tenant under this Lease.
6. Security Deposit. On execution of this Lease, Tenant shall deposit
with Landlord Ten Thousand Dollars ($10,000.00) as a security deposit
for the performance by Tenant of the provisions of this Lease. If
Tenant is in default, Landlord can use the security deposit, or any
portion of it, to cure the default or to compensate Landlord for all
damage sustained by Landlord resulting from Tenant's default. Tenant
shall immediately, on demand, pay to Landlord a sum equal to the portion
of the security deposit expended or applied by Landlord as provided in
this paragraph so as to maintain the security deposit in the sum
initially deposited with Landlord. If Tenant is not in default at the
expiration or termination of this Lease, Landlord shall return the
security deposit to Tenant. Landlord's obligations with respect to the
security deposit are those of a debtor and not a trustee. Landlord can
maintain the security deposit separate and apart from Landlord's general
funds or can commingle the security deposit with Landlord's general and
other funds. Landlord shall not be required to pay Tenant interest on
the security deposit.
7. Personal Property Taxes. Tenant shall pay before delinquency all
taxes, assessments, license fees, and other charges that are levied and
assessed on Tenant's personal property installed or located in or on the
Premises, and that become payable during the term. On demand by
Landlord, Tenant shall furnish Landlord satisfactory evidence of these
payments.
8. Real Property Taxes.
a. Payment. Lessor shall pay the Real Property Taxes applicable to the
Property and such amount shall be included in the calculation of Common
Area Operating Expenses according to Section 10.
b. Definition. As used herein, the term "Real Property Taxes" shall
include any form of real estate, tax or assessment, general, special,
ordinary or extraordinary, and any license fee, commercial rental tax,
improvement bond or bonds, levy or tax (other than inheritance, personal
income or estate taxes) imposed upon the Real Property by any authority
having the direct or indirect power to tax, including any city, state or
federal government, or any school, agricultural, sanitary, fire, street,
drainage or other improvement district thereof, levied against any legal
or equitable interest of Landlord in the Real Property or any portion
thereof, Landlord's right to rent or other income therefrom and/or
Landlord's business of leasing the Premises. The term "Real Property
Taxes" shall also include any tax, fee, levy, assessment or charge, or
any increase therein, imposed by reason of events occurring, or changes
in applicable law taking effect, during the term of this Lease,
including but not limited to the execution of this Lease, or any
modification, amendment or transfer thereof, and whether or not
contemplated by the parties. In calculating Real Property Taxes for any
calendar year, the Real Property Taxes for any real estate tax year
shall be included in the calculation of Real Property Taxes for such
calendar year based upon the number of days which such calendar year and
tax year have in common.
c. Tax Increases: Tenant shall not be liable for increases in the Real
Property Taxes under the following circumstances: (i) a reappraisal
and/or reassessment of the property resulting from a sale; (ii)
additions or enhancements to the Real Property; or (iii) tenant
improvements other than those relating to the Premises.
9. Use. The Premises are to be used for a bank and incidental or
related uses, and for no other business or purpose without the prior
written consent of Landlord, which shall not be unreasonably withheld.
No use shall be made or permitted to be made of the Premises, nor acts
done in or about the Premises, which will in any way conflict with any
law, ordinance, rule or regulation affecting the occupancy or use of the
Premises which has been or is subsequently enacted or promulgated by any
public authority, or which will increase the existing rate of insurance
upon the building, or cause a cancellation of any insurance policy
covering the building or any part thereof, nor shall Tenant sell, or
permit to be kept, used or sold in or about the Premises, any article
which may be prohibited by the standard form of fire insurance policy.
Tenant shall not commit, or suffer to be committed, any waste upon the
Premises or, any public or private nuisance, or other act or thing which
may disturb the quiet enjoyment of any other tenant in the building, nor
use any apparatus, machinery or device in or about the Premises which
shall cause any substantial noise or vibration, or which shall
substantially increase the amount of electricity or water, if any,
agreed to be furnished or supplied under this Lease. Tenant further
agrees not to connect with electric wires or water or other pipes any
apparatus, machinery or device without the consent of Landlord, which
consent shall not be unreasonably withheld. So long as Tenant complies
with all present and future ordinances and statutes relating thereto,
Landlord agrees not to unreasonably withhold consent for installation by
Tenant, on the roof of the Real Property, of telecommunications
equipment to be used exclusively by Tenant only in the furtherance of
Tenant's business.
10. Common Area Operating Costs.
a. Tenant's Share. As additional rent payable by Tenant under this
Lease, Tenant shall pay the Landlord, in the manner set forth in this
Paragraph 10, Tenant's share of Landlord's operating costs for the
building and the Real Property in which the Premises are located.
Tenant's proportionate share of the operating costs shall be the ratio
that the total number of square feet in the Premises bears to the total
number of leasable square feet in the building in which the Premises are
located.
b. Definition of Operating Costs. Landlord's operating costs include,
without limitation other than as defined in this Lease, all costs of any
kind paid or incurred by Landlord in operating, cleaning, equipping,
protecting, lighting, repairing, replacing, heating, air-conditioning,
and maintaining the areas of the Building and Real Property neither
leased nor available for lease to tenants, excluding any costs covered
by Paragraph 11.b. (Landlord's Responsibility) and Paragraph 15
(Utilities) hereof. The costs shall include, without limitation,
utilities (excluding separately metered electricity), supplies,
janitorial services, employees' wages, social security and unemployment
insurance contributions, union benefits, rubbish removal, maintenance
and replacement of landscaping, maintenance and repair of parking areas,
premiums for public liability and property damage and fire and extended
coverage insurance, and real property taxes. These costs shall include
a reasonable reserve for repair and replacement of equipment used in the
maintenance and operation of the building and Real Property. Tenant's
responsibility for reimbursement of capital improvements shall be
limited to the amortized portion of such improvements using the
estimated useful life (as determined under generally accepted accounting
principles) as the basis for amortization.
c. Estimated Annual Costs. No later than December 15th of each calendar
year, Landlord shall furnish to Tenant a written estimate of Landlord's
operating costs for the following calendar year, showing Tenant's share
thereof. Landlord agrees that all such estimates should be reasonable
and made in good faith, and shall represent Landlord's best estimate of
the total operating costs actually anticipated for the following year.
Tenant shall pay the Landlord the amount of Tenant's share of the
estimated operating costs in 12 equal monthly installments, payable on
the first day of each month of the year to which the estimate applies.
d. Year-End Adjustment. Within thirty (30) days after the
end of each calendar year, Landlord shall furnish to Tenant a statement
of the actual total operating costs for the calendar year just ended,
showing Tenant's share thereof. The statement shall be prepared,
signed, and certified to be correct by Landlord or by Landlord's
representative. If Tenant's share of actual operating costs for that
calendar year exceeds the monthly payments made by Tenant, Tenant shall
pay Landlord the deficiency within thirty (30) days after receipt of the
statement. If Tenant's payments made during that calendar year exceed
Tenant's share of the operating costs, Landlord, in Landlord's
discretion, shall either apply the surplus against the reserve for the
next year, or refund the excess to Tenant.
e. Adjustment for Last Year. Within thirty (30) days after
the end of the calendar year in which this Lease expires or terminates,
Landlord shall furnish to Tenant a statement of the total operating
costs for the calendar year, and of Tenant's share of any increases.
The statement shall be prepared, signed, and certified to be correct by
Landlord or its representative. If Tenant's share of operating cost
increases for that calendar year exceeds the monthly payments made by
Tenant, Tenant shall pay Landlord the deficiency within ten (10) days
after receipt of the statement. If Tenant's payments made during that
calendar year exceed Tenant's share of operating cost increases,
Landlord shall pay Tenant the excess at the time Landlord furnishes the
statement to Tenant.
f. Books and Records. Landlord shall keep full, accurate,
and separate books of account covering Landlord's operating costs, and
the statement to Tenant shall accurately reflect the total operating
costs and Tenant's share. The books of account shall be retained by
Landlord at the building in which the Premises are located for a period
of at least twenty-four (24) months after the expiration of each
calendar year. Tenant shall have the right at all reasonable times
during the term to inspect the books of account.
g. Right of Audit. On Tenant's written request given not
more than ninety (90) days after Tenant's receipt of the statement for a
particular year, and provided that Tenant is not then in default under
this Lease beyond any applicable cure period provided in this Lease and
that Tenant has paid all amounts required to be paid under the
applicable statement, then Landlord shall provide Tenant with an audited
statement (Accountant's Statement) of the Operating Costs (as defined
above) for the Real Property for such year from Landlord's independent
certified public accountants, and Landlord shall also furnish Tenant
with such reasonable supporting documentation in connection with the
such Operating Costs as Tenant may reasonably request.
Landlord shall provide this information and the Accountant's Statement
to Tenant within sixty (60) days after Tenant's written request for it.
The Accountant's Statement shall contain sufficient detail to enable
Tenant to verify that, in computing the Operating Costs payable by
Tenant, Landlord has adhered to the terms of exclusions and inclusions
for Operating Costs, as set forth in this Lease.
Within fifteen (15) days following Tenant's receipt of the Accountant's
Statement, Tenant and Landlord shall concurrently be provided with any
audit report prepared for Tenant in connection with Tenant's review of
the Operating Costs, and Tenant shall advise Landlord if Tenant disputes
the Operating Costs or Tenant's share of them as set forth in the
Landlord's statement for the applicable year. Thereafter, if Landlord
ascertains that an error has been made that is greater than five percent
(5%), Tenant's sole remedy shall be for the parties to make such
appropriate payments or reimbursements, as the case may be to each other
as are determined to be owing, provided that any reimbursements payable
by Landlord to Tenant may, at Landlord's option, instead be credited
against the Minimum Monthly Rent next coming due under this Lease unless
the Lease Term has expired, in which event Landlord shall refund the
appropriate amount to Tenant.
Tenant shall keep any information gained from its review of Landlord's
records confidential and shall not disclose it to any other party,
except as required by law. If requested by Landlord, Tenant shall
require its employees or agents reviewing Landlord's records to sign a
confidentiality agreement as a condition of Landlord providing the
Accountant's Statement to Tenant.
11. Maintenance and Repairs.
a. Tenant's Responsibility. Except as provided in Paragraphs 11(b)
(Maintenance and Repairs - Landlord's Responsibility) and 19
(Destruction), Tenant, at its cost, shall maintain, at Tenant's sole
cost and expense and at all times shall keep the Premises and every part
thereof in good order, condition and repair, including without limiting
the generality of the foregoing, all equipment or facilities
specifically serving the Premises, such as plumbing, heating, air
conditioning, ventilating, electrical, lighting facilities, boilers,
fire hose connections if within the Premises, fixtures, interior walls,
interior surfaces of interior walls, ceilings, floors, windows, doors,
plate glass, and skylights, but excluding any items which are the
responsibility of the Landlord pursuant to Section 11(b) below. Tenant,
in keeping the Premises in good order, condition and repair, shall
exercise and perform good maintenance practices. Tenant's obligations
shall include restorations, replacements, renewals where necessary to
keep the Premises and all improvements thereon or a part thereof in good
order, condition or state of repair. Tenant shall promptly comply with
all laws, or ordinances, building codes and governmental regulations now
or hereafter in force that apply as a result of Tenant's particular use
of the Premises at the time. Tenant, at its cost, shall make any
repairs, alterations, maintenance and improvements to the Premises
required by such laws.
b. Landlord's Responsibility. Landlord, at its cost, shall maintain
in good condition the structural parts of the building and the roof.
Tenant shall give prompt notice to Landlord of any damage, malfunction,
or other condition requiring repair by Landlord. Landlord shall
promptly comply with all laws, ordinances, building codes, and
governmental regulations now or hereafter in force that apply without
regard to Tenant's particular use of the Premises at the time.
Landlord, at its cost, shall make any repairs, alterations, maintenance
and improvements to the Premises required by such laws. Tenant shall
have no obligation to reimburse Landlord for the costs associated with
Landlord's compliance with its responsibilities under this Paragraph
11.b nor shall they be passed through to Tenant as operating costs.
12. Alterations. Except as provided in Xxxxxxxxx 00 (Xxxxx Fixtures),
Tenant
shall not make any material alterations, improvements, additions or
changes to the to the Premises ("Alterations") without Landlord's prior
written consent. Landlord shall not unreasonably withhold its consent
to proposed Alterations; however, the Alterations for which Landlord may
reasonably withhold consent, and which are hereby deemed "Material
Alterations," include those that would or could:
(a) Affect the structure of the Building or any portion of the Building
other than the interior of the Premises;
(b) Affect any of the Systems of the Building, the Premises, or the
premises of any other tenant of the Building;
(c) Result in Landlord being required under applicable law to perform
any work that Landlord could otherwise avoid or defer;
(d) Result in an increase in the demand for utilities or services that
Landlord is required to provide to this Tenant or to any other tenant;
or
(e) Cause an increase in the premiums for any insurance carried by
Landlord, whether or not said insurance is required under this Lease.
"Systems of the Building..." means all systems and equipment, including
plumbing, heating, ventilation, and air-conditioning, electrical,
communications, fire/life-safety; elevator and security systems that
serve all or a part of the Building.
Tenant shall request such consent in writing, which must be accompanied
by the plans and specifications for the proposed work. Unless otherwise
provided by written agreement, all Alterations shall be done at the sole
cost of Tenant, shall be the property of Landlord, and shall remain on
and be surrendered with the Premises on expiration or termination of the
term; provided, however, that at Landlord's option, Tenant shall, at
Tenant's expense, when surrendering the Premises, restore the same to
their original condition.
If Tenant makes any Material Alterations to the Premises, as
provided in this paragraph, the alterations shall not be commenced until
five (5) days after Landlord has received notice from Tenant stating the
date the installation of the Alterations is to commence, so that
Landlord can post and record an appropriate notice of
non-responsibility.
Tenant shall make or cause to be made all such Alterations to the
Premises (including, without limiting the generality of the requirement
of this sentence, removing such barriers and providing such alternative
services) as shall be required by the Americans with Disabilities Act of
1990, and rules and regulations from time to time promulgated
thereunder.
13. Trade Fixtures. Subject to the provisions of Paragraph 12
(Alterations) hereof, Tenant may install and maintain its trade fixtures
on the Premises, including, but not necessarily limited to, the vault
door, provided that such fixtures, by reason of the manner in which they
are affixed, do not become an integral part of the building or Premises.
Tenant, if not in default hereunder, may at any time or from time to
time during the term hereof, or upon the expiration or termination of
this Lease, alter or remove any such trade fixtures so installed by
Tenant. If not so removed by Tenant on or before the expiration or
termination of this Lease, Tenant, upon the request of Landlord so to
do, shall thereupon remove the same. Any damage to the Premises caused
by any such installation, alteration or removal of such trade fixtures
shall be promptly repaired at the expense of Tenant.
14. Mechanics' Liens. Tenant shall pay all costs for construction done
by it, or caused to be done by it, on the Premises, as permitted by this
Lease. Tenant shall keep the Premises free and clear of all mechanics'
liens resulting from construction done by or for Tenant.
Tenant shall have the right to contest the correctness or validity
of any such lien if, immediately on demand by Landlord, Tenant procures
and records a lien release bond issued by a corporation authorized to
issue surety bonds in California in an amount equal to one and one-half
(1-1/2) times the amount of the claim of the lien. The bond shall meet
the requirements of Civil Code Section 3143 and shall provide for the
payment of any sum that the claimant may recover on the claim (together
with costs of suit, if it recovers in the action).
15. Utilities. Tenant shall pay for all utilities and services
furnished to or used by it, including, without limitation, gas,
electricity, and telecommunications services. To the extent permitted
by the infrastructure of the Real Property, Tenant shall make all
arrangements for such services and shall pay all connection charges
16. Indemnification of Landlord. Tenant agrees to defend (with counsel
satisfactory to Landlord), indemnify and hold Landlord harmless against
all claims, and the expense of defending against such claims, for injury
or damage to persons or property relating to or arising from this Lease,
or the use or occupancy or presence on or about the Premises of Tenant,
its officers, directors, shareholders, trustees, members, agents,
employees, independent contractors, customers, business visitors,
service providers, invitees, assigns, and all persons and entities
claiming through any of these persons or entities, except to the extent
that such injury or damage results from active negligence or willful
misconduct of Landlord.
17. Insurance.
a. Liability and Property Damage. Tenant shall maintain comprehensive
public liability and property damage insurance with a combined single
limit of not less than One Million Dollars ($l,000,000.00), insuring
against all liability of Tenant and its authorized representatives
arising out of or in connection with Tenant's use or occupancy of the
Premises. Such insurance shall insure performance by Tenant of the
indemnity provisions of Paragraph 16 (Indemnification of Landlord).
Landlord and Tenant shall be named as co-insureds, and the policy shall
contain cross-liability endorsements.
b. Review of Coverage. Not more frequently than every three (3) years,
if, in the reasonable opinion of Landlord's lender or of the insurance
broker retained by Landlord, the amount of public liability and property
damage insurance coverage at that time is not adequate, Tenant shall
increase the insurance coverage as required by either Landlord's lender
or Landlord's insurance broker.
c. Tenant's Personal Property. Tenant shall maintain on all of its
personal property, Tenant's improvements, and alterations in, on, or
about the Premises, a policy of standard fire and extended coverage
insurance, with vandalism and malicious mischief endorsements, to the
extent of at least Ninety Percent (90%) of their full replacement value.
The proceeds from any such policy shall be used by Tenant for the
replacement of personal property or the restoration of Tenant's
improvements or alterations.
d. Fire and Extended Coverage. Landlord shall maintain on the building
and other improvements that are a part of the Premises, a policy of
standard fire and extended coverage insurance with vandalism and
malicious mischief endorsements. The premiums for such coverage shall
be paid by Landlord as a common area expense described in Section 10.
e. Policy Provisions. Each insurance policy maintained by Tenant under
this Lease shall contain a provision requiring thirty (30) days' written
notice from the insurance company to Landlord, Tenant, and Landlord's
lender before any cancellation or change in the coverage, scope, or
amount of the policy. Each policy, or a certificate of the policy,
together with evidence of payment of premiums, shall be deposited with
the other party at the commencement of the term, and on renewal of the
policy, not less than twenty (20) days before expiration of the term of
the policy.
18. Waiver of Subrogation. The parties release each other, and their
respective authorized representatives, from any claims for damage to any
person, or to the Premises and to the fixtures, personal property,
Tenant's improvements and alterations of either Landlord or Tenant in or
on the Premises that are caused by or result from the risks insured
against under any insurance policies carried by the parties and in force
at the time of any such damage.
Each party shall cause each insurance policy obtained by it to
provide that the insurance company waives all right of recovery by way
of subrogation against either party in connection with any damage
covered by any policy. Neither party shall be liable to the other for
any damage caused by fire or any of the risks insured against under any
insurance policy required by this Lease. If any insurance policy cannot
be obtained with a waiver of subrogation, or is obtainable only by the
payment of an additional premium charge above that charged by insurance
companies issuing policies without waiver of subrogation, the party
undertaking to obtain the insurance shall notify the other party of this
fact. The other party shall have a period of ten (10) days after
receiving the notice either to place the insurance with a company that
is reasonably satisfactory to the other party and that will carry the
insurance with a waiver of subrogation, or to agree to pay the
additional premium if such policy is obtainable at additional cost. If
the insurance cannot be obtained or the party in whose favor a waiver of
subrogation is desired refuses to pay the additional premium charged,
the other party is relieved of the obligation to obtain a waiver of
subrogation rights with respect to the particular insurance involved.
19. Destruction. If the whole or any part of the Premises shall
be destroyed by fire or other cause, or be so damaged thereby that they
are untenantable and cannot be rendered tenantable within three hundred
sixty five (365) days from the date of such destruction or damage, this
Lease may be terminated by Landlord or Tenant by written notice. Within
forty-five (45) days from the date of such destruction or damage,
Landlord shall give written notice to Tenant as to whether or not the
Premises will be rendered tenantable within three hundred sixty five
(365) days from the date of such destruction or damage. In case the
damage or destruction be not such as to permit termination of the Lease
as above provided, or neither Landlord nor Tenant elects to terminate
the Lease as above provided, Landlord shall within a reasonable time,
render said Premises tenantable, and a proportionate reduction shall be
made in the rent herein reserved corresponding to the time during which
and to the portion of the Premises of which Tenant shall be deprived of
possession. The provisions of Sections 1932(2) and 1933(4) of the
California Civil Code shall not apply to this Lease, and Tenant waives
the benefit of such provisions.
20. Condemnation. Should the whole or any part of the Premises be
condemned and taken by any competent authority for any public or
quasi-public use or purpose, all awards payable on account of such
condemnation and taking shall be payable to Landlord, and Tenant hereby
waives all interest in or claim to said awards, or any part thereof.
except that Tenant shall be entitled to receive from the award a sum
attributable to the following: (i) Tenant's improvements or alterations
made to the Premises in accordance with this Lease that Tenant has the
right to remove but elects not to remove; (ii) the fair market value of
the Lease at the time of the taking; and (iii) Tenant's loss of
goodwill. If the whole of the Premises shall be so condemned and taken,
then this Lease shall terminate. If only a part of the Premises is
condemned and taken and the remaining portion thereof is not suitable
for the purposes for which Tenant has leased said Premises, this Lease
shall terminate. If only a part of the Premises is condemned and taken
and the remaining portion thereof is, in Tenant's opinion, suitable for
the purposes for which Tenant has leased said Premises, this Lease shall
continue, but the rental shall be reduced in an amount proportionate to
the square footage of the portion taken as it related to the total
square footage of the Premises.
21. Assignment and Subletting.
a. Landlord's Consent Required. Tenant shall not assign, mortgage or
pledge this Lease, or any interest therein, and shall not sublet the
Premises or any part thereof, or any right or privilege appurtenant
thereto, or allow any other person (the agents and servants of Tenant
excepted) to occupy or use the Premises, or any portion thereof, without
the prior written consent of Landlord, which consent Landlord agrees not
to unreasonably withhold. A consent to one assignment, mortgage,
pledge, subletting, occupation or use by any other person shall not
relieve Tenant from any obligation under this Lease, and shall not be
deemed to be a consent to any subsequent assignment, mortgage, pledge,
subletting, occupation or use by another person. Any assignment,
mortgage, subletting, occupation or use without such consent shall be
void, and shall, at the option of Landlord, terminate this Lease.
b. Tenant Still Bound. Failure of any subtenant or assignee to make any
payments to Tenant shall not affect the obligation of Tenant to pay rent
or any other obligation under the Lease owing to Landlord. The
provisions of any sublease or assignment cannot be modified without the
written consent of Landlord.
c. Attorneys' Fees. Tenant shall promptly pay upon billing the
reasonable attorneys' fees and out of pocket costs incurred by Landlord
for the review or preparation of any documents in connection with a
proposed assignment or sublease, provided that such fees shall not
exceed $1,000.00.
22. Insolvency and Receivership. Either the appointment of a receiver
to take possession of all, or substantially all, of the assets of Tenant
or a general assignment by Tenant for the benefit of creditors, or any
action taken or suffered by Tenant under any insolvency or bankruptcy
act, shall constitute a breach of this Lease by Tenant.
23. Default and Re-Entry. In the event of any breach of the terms and
provisions of this Lease by Tenant, or of Tenant's interest herein, or
any part thereof be assigned or transferred without the written consent
of Landlord, either voluntarily or by operation of law, whether by
judgment, execution, death, receivership or any other means, or if
Tenant vacates or abandons the Premises, which shall be conclusively
presumed if Tenant leaves the Premises closed or unoccupied continuously
for thirty (30) days, then in any such event, Landlord, besides other
rights or remedies it may have, shall have the immediate right of
re-entry and may remove all persons and property from the Premises and
may store such property at the cost of and for the account and risk of
Tenant.
Should Landlord elect to re-enter as herein provided, or should
Landlord take possession pursuant to legal proceedings or pursuant to
any notice provided for by law, it may either terminate this Lease or,
pursuant to Section 1951.4 of the California Civil Code, and even though
Tenant has breached this Lease and abandoned the Premises, continue the
Lease in effect for so long as Landlord does not terminate Tenant's
right to possession, and Landlord may enforce all its rights and
remedies under the lease, including the right to recover the rent as it
becomes due.
If Landlord elects to continue the Lease in effect, it may re-let
the Premises, or any part thereof, for such term or terms (which may be
for a term extending beyond the term of this Lease) and at such rental
or rentals and upon such other terms and conditions as Landlord, in its
sole discretion, may deem advisable and shall have the right to make
alterations and repairs to the Premises.
Rents received by such Landlord from such re-letting shall be
applied: first, to the payment of any costs and expenses of such
re-letting, including a reasonable attorney's fee and any real estate
commission actually paid, and any costs and expenses of such alterations
and repairs; second, to the payment of any indebtedness, other than
rent, due hereunder from Tenant to Landlord; third, to the payment of
rent due and unpaid hereunder; and the residue, if any, shall be held by
Landlord and applied in payment of future rent or other obligations as
the same may become due and payable hereunder. If the net rent from
such re-letting during any month after first applying the rent received
to such fees, costs, expenses and other indebtedness, is less than that
to be paid during that month by Tenant hereunder, Tenant shall pay any
such deficiency to Landlord, and such deficiency shall be calculated and
paid monthly.
No such re-entry or taking possession of said Premises by Landlord
shall be construed as an election on its part to terminate this Lease
unless a written notice of such intention be given to Tenant or unless
the termination thereof be decreed by a court of competent jurisdiction.
Notwithstanding any such re-letting without termination, Landlord may,
at any time thereafter, elect to terminate this Lease for such previous
breach.
Should Landlord at any time terminate this Lease for any breach,
and thereafter seek relief pursuant to Section 1951.2 of the California
Civil Code, interest shall be allowed upon unpaid rent for the purposes
of Section 1951.2(b) at Ten Percent (10%) per annum or the maximum rate
permitted by law (as opposed to the legal rate), if greater. Landlord
shall be entitled to recover at the time of an award of damages for
default the worth of the amount by which the unpaid rent for the balance
of the term after the time of award exceeds the amount of the rental
loss that Tenant proves could reasonably be avoided. Unless otherwise
agreed between the parties, any proof by Tenant under Sections
1951.2(a)(2), 1951.2(a)(3), or 1951.2(c)(1) of the California Civil
Code, or any successor statutes, as to the amount of rental loss that
could be reasonably avoided, shall be made in the following manner:
Landlord and Tenant shall each select a licensed real estate broker in
the business of renting property of the same type and use as the leased
Premises and in the same geographic vicinity, they shall select a third
licensed real estate broker, and the three so selected shall determine
the amount of the rental loss that could be reasonably avoided for the
balance of the term of this Lease after the time of award. The decision
of the majority of said brokers shall be final and binding upon the
parties hereto.
The foregoing rights and remedies shall be in addition to and
cumulative with any other rights and remedies available to Landlord
under the terms of this Lease or any applicable laws, statutes or
regulations.
24. Waiver. The waiver by Landlord of any breach of any term,
covenant, or condition herein contained shall not be deemed to be a
waiver of such term, covenant or condition or of any subsequent breach
of the same or any other term, covenant or condition herein contained.
The subsequent acceptance of rent hereunder by Landlord shall not be
deemed to be a waiver of any preceding breach by Tenant of any term,
covenant or condition of this Lease, other than the failure of Tenant to
pay the particular rental so accepted, regardless of Landlord's
knowledge of such preceding breach at the time of acceptance of such
rent.
25. Removal of Property. Whenever Landlord shall remove any property
of Tenant from the Premises and store the same elsewhere for the
account, and at the expense and risk, of Tenant, as provided in
Paragraph 23 (Default and Re-Entry), hereof, and Tenant shall fail to
pay the cost of storing any such property after it has been stored for a
period of ninety (90) days or more, Landlord may sell any or all such
property at public or private sale, in such manner and at such times and
places as Landlord in its sole discretion may deem proper, without
notice to or demand upon Tenant, for the payment of any part of such
charges or the removal of any such property, and shall apply the
proceeds of such sale: first, to the cost and expenses of such sale,
including reasonable attorney's fees actually incurred; second, to the
payment of the charges for storing any such property; third, to the
payment of any other sums of money which may then or thereafter be due
to Landlord from Tenant under any of the terms hereof; and fourth, the
balance, if any, to Tenant.
26. Attorneys' Fees and Costs of Suit. In the event of any action or
proceeding brought by either party against the other under this Lease
the prevailing party shall be entitled to recover for the fees of its
attorneys in such action or proceeding, including costs of appeal, if
any, in such amount as the court may adjudge reasonable as attorneys'
fees.
27. Hold Harmless. Tenant shall indemnify and hold Landlord harmless
from all claims arising from Tenant's use of the Premises, the Real
Property, or the Common Area or the conduct of its business and from any
breach or default in the performance of Tenant's obligations under the
terms of this Lease; and if any action is brought against Landlord,
Tenant shall defend Landlord at Tenant's expense by counsel satisfactory
to Landlord.
28. Subordination.
a. Effect of Subordination. This Lease, at Landlord's option, shall be
subordinate to any ground lease, mortgage, deed of trust, or any other
hypothecation for security now or hereafter placed upon the Premises and
to any and all advances made on the security thereof and to all
renewals, modifications, consolidations, replacements and extensions
thereof. Notwithstanding such subordination, Tenant's right to
possession of the Premises shall not be disturbed if Tenant is not in
default and so long as Tenant shall pay the rent and observe and perform
all of the provisions of this Lease, unless this Lease is otherwise
terminated pursuant to its terms. If any mortgagee, trustee or ground
lessor shall elect to have this Lease prior to the lien of its mortgage,
deed of trust, or ground lease, and shall give written notice thereof to
Tenant, this Lease shall be deemed prior to such mortgage, deed of trust
or ground lease, whether this Lease is dated prior or subsequent to the
date of said mortgage, deed of trust or ground lease or the date or
recording thereof.
b. Documentation. Tenant agrees to execute any documents required to
effectuate such subordination or to make this Lease prior to the lien of
any mortgage, deed of trust or ground lease, as the case may be, and
failing to do so within ten (10) days after written demand, does hereby
make, constitute and irrevocably appoint Landlord as Tenant's
attorney-in-fact and in Tenant's name, place and stead, to do so.
Tenant acknowledges that Tenant's failure to deliver documents referred
to above may cause Landlord serious financial damage by causing the
failure of a financing or sale transaction. Tenant shall be liable for
all consequential damages to Landlord in the event of such failure.
29. Holding Over. If Tenant holds over after the term hereof, with or
without the express or implied consent of Landlord, such tenancy shall
be from month to month only, and not a renewal hereof or an extension
for any further term. In such case, rent shall be payable in the amount
and at the time specified in Paragraph 4 (Rent) above, and such month to
month tenancy shall be subject to every other term, covenant and
agreement contained in this Lease.
30. Entry and Inspection. Tenant will permit Landlord and its agents to
enter into and upon the Premises at all reasonable times, upon
twenty-four hours notice (except in an emergency), for the purpose of
inspecting the same, or for the purpose of protecting the interest
therein of Landlord or the Owner, or to post notices of
non-responsibility, or to make alterations or additions to the Premises,
including the erection of scaffolding, props or other mechanical
devices, or to provide any service provided by Landlord to Tenant
hereunder, without any rebate of rent to Tenant for any loss of
occupancy or quiet enjoyment of the Premises, or damage, injury or
inconvenience thereby occasioned. Tenant will permit Landlord, at any
time within one hundred eighty (180) days prior to the expiration of
this Lease, to bring prospective tenants or purchasers upon the
Premises, for purposes of inspection or display.
31. Sale or Transfer of Premises. If Landlord sells or transfers all or
any portion of the Premises, Landlord, on consummation of the sale or
transfer, shall be released from any liability thereafter accruing under
this Lease. If any security deposit or prepaid rent has been paid by
Tenant, Landlord can transfer the security deposit or prepaid rent to
Landlord's successor and on such transfer Landlord shall be discharged
from any further liability in reference to the security deposit or
prepaid rent.
If Tenant purchases all of the Premises, the Lease shall terminate
on the date title vests in Tenant, and Landlord shall remit to Tenant
all prepaid and unearned rent. If Tenant purchases a part of the
Premises, this Lease as to the part purchased shall terminate on the
date title vests in Tenant, and the monthly rent shall be reduced in the
same ratio that the value of the Premises before the purchase bears to
the value of the Premises covered by the Lease immediately after the
purchase.
32. Successors and Assigns. Subject to the provisions hereof relating
to assignment, mortgaging, pledging and subletting, this Lease is
intended to and does bind the heirs, executors, administrators,
successors and assigns of any and all of the parties hereto.
33. Time. Time is of the essence of this Lease.
34. Notices. All notices that Landlord or Tenant may be required, or
may desire, to serve on the other may be served, as an alternative to
personal service, by mailing the same, postage prepaid, addressed to
Landlord at 000 Xxxx Xxxx Xxxxxx, Xxxxxx, XX , and to Tenant at the
Premises, whether or not Tenant has departed from, abandoned or vacated
the Premises, or addressed to such other address or addresses as either
Landlord or Tenant may from time to time designate to the other in
writing.
35. Complete Agreement. This instrument contains the entire agreement
of the parties with respect to the lease of the Premises by Landlord to
Tenant. There are, and were, no verbal representations, understandings,
stipulations, agreements or promises pertaining thereto that are not
incorporated in this Lease. This Lease may be altered, waived, amended
or extended only by a writing signed by both parties.
36. Estoppel Certificate. Tenant, within ten (10) days after receipt of
written notice from Landlord, shall sign and deliver to Landlord a
certificate stating that this Lease is in full force and effect.
Failure to deliver the certificate within the time specified shall be
conclusive as to the truth of the information contained therein.
37. Signs. Subject to Landlord's approval, which Landlord agrees not to
unreasonably withhold, Tenant may erect any sign or signs at or upon the
Real Property or the Premises as are approved by the City of Sonoma.
Landlord understands that Tenant's business requires signage of high
quality and excellent visibility and agrees to reasonably cooperate with
Tenant, at no cost to Landlord, to achieve Tenant's signage goals.
Tenant shall keep all its signs in good condition and repair, shall
remove the same upon the expiration or prior termination of the term of
this Lease, and shall repair any damage caused by such removal.
38. Paragraph Headings. The paragraph headings and numbers appearing in
this Lease are inserted only as a matter of convenience and in no way
define, limit, construe or describe the scope or intent of such
paragraphs of this Lease, nor in any way affect this Lease.
39. Recording. Tenant shall not record this Lease without the written
consent of Landlord, but a short form Memorandum of Lease may be
recorded by Tenant in a form approved in advance by Landlord.
Landlord's approval shall not be unreasonably withheld or delayed..
40. Mediation of Disputes. If a dispute arises out of or relates to
this Lease or its breach, Landlord and Tenant agree to first try in good
faith to settle the dispute by voluntary mediation before resorting to
court action.
41. Parking.
(a) So long as this Lease remains in effect and provided that Tenant is
not in default, and subject to applicable government rules, regulations
and guidelines and to the Parking Rules and Regulations established and
revised by Landlord from time to time, Tenant's Customers ("Customers"
means Tenant's customers, clients, patrons, or retail or business
visitors), and only Tenant's Customers and those of other tenants of the
building, may park in the non-exclusive parking area designated for
Customers. Said Customer parking area is that parking area located
nearest the West Napa Street entrance to the Xxxxx-Sonoma Building at
000 Xxxx Xxxx Xxxxxx. Unless established by a written modification to
this Lease executed by the parties, neither Tenant nor its employees
shall be permitted to use the parking areas designated as "Reserved" for
the Sonoma Index-Tribune. Notwithstanding the foregoing, on Saturdays,
Sundays and national holidays the parking areas reserved for the Sonoma
Index-Tribune shall be open to use by the public, including Tenants and
its employees and Customers, subject to the property's Parking Rules and
Regulations.
Tenant shall notify its employees in writing of the provisions of this
Paragraph 40 and its subparagraphs regarding parking, and Tenant shall
give its employees copies of the Parking Rules and Regulations attached
as Exhibit C hereto and any future revisions thereto.
(b) Landlord agrees to maintain or cause to be maintained an automobile
parking area and to maintain and operate, or cause to be maintained and
operated, said automobile parking area during the Term of this Lease for
the benefit and use of the customers, clients, visitors, and service
suppliers of the building. Nothing contained herein shall be deemed to
impose liability upon Landlord for personal injury or theft, for damage
to any motor vehicle, or for loss of property from within any motor
vehicle, which is suffered by Tenant or any of its clients, visitors,
service suppliers or employees in connection with their use of any
parking area provided by Landlord.
(c) Landlord specifically reserves the right to change, at Landlord's
sole discretion, the location, size, configuration, design, layout, days
and times of permitted use, and all other aspects of the parking
facility, including the institution or discontinuance of any fee-based
parking, automated or staffed parking gates or a valet system. Landlord
may close off or restrict access to the parking facility, or to specific
areas within the parking facility, from time to time to facilitate
construction, alteration or improvements, without incurring any
liability to Tenant and without any abatement of rent under this Lease.
Landlord shall also have the right to establish, change and enforce
against all users of said parking area such reasonable rules and
regulations as may be deemed necessary and advisable for the proper and
efficient operation and maintenance of said parking area. Such parking
rules and regulations may include, without limitation, the hours during
which the parking area or portions thereof shall be open for use. If
Tenant commits, permits or allows any of the prohibited activities
described in the parking rules then in effect, then Landlord shall have
the right without notice, in addition to such other rights and remedies
it may have, to remove or tow away the vehicle involved and charge the
cost to Tenant, which cost shall be immediately payable by Tenant upon
demand by Landlord and shall be part of the additional rent due Landlord
hereunder. In addition, Landlord may terminate the privileges of Tenant
to use the parking facility. No termination of parking privileges or
removal of a vehicle shall create any liability on Landlord, nor shall
such action be deemed to interfere with Tenant's right to possession of
the Premises.
(d) Landlord may, if in its opinion the same be advisable, establish
for the parking area, including in the rules and regulations, a system
or systems of charged validation or other operation including, but not
limited to, a system of charges against non-validated parking checks of
users. Tenant shall comply with any such system in its use of the
parking area and the use of same by Tenant's customers, clients,
employees, visitors and service suppliers. Landlord may assign portions
of any parking area to be used exclusively by Tenant, its employees,
visitors and clients, or by other tenants. Tenant may be required to
pay for all usage of parking facilities by Tenant and its employees. In
addition, Landlord may charge Tenant directly for any usage of parking
facilities by Tenant's guests or visitors, or may require Tenant to
validate all visitor parking for Tenant's customers, clients, visitors
and service suppliers.
(e) Tenant agrees to promptly comply with and to cause each of the
Tenant's employees at the Premises to comply with all parking programs
that Landlord may adopt from time to time, and to ensure Landlord's
compliance with any and all parking-related governmental regulations,
requirements and permits. In the event that Landlord receives a notice
of violation from or is fined by any governmental entity for
noncompliance with any such regulation, requirement or permit and
Landlord determines that the reason therefor is the failure by Tenant or
by one or more of the persons employed by Tenant to observe the rules
and regulations or parking program governing the parking facility,
Tenant shall be responsible for all fines, penalties and other charges
imposed by said governmental entity with respect to the period of
noncompliance and such amounts shall constitute additional rent payable
by Tenant, upon demand, under this Lease.
(f) Notwithstanding anything to the contrary contained in this Paragraph
40, or in this Lease, Landlord shall designate the four parking spaces
nearest the west entrance to the building (as shown on Exhibit A) as
exclusive parking for Sonoma National Bank customers and shall place
signs on those spaces indicating "15 Minute Parking for Sonoma National
Bank Customers Only." At no time during the term of the Lease, or any
extension thereof, shall Landlord remove, reduce, relocate or place
restrictions or charges upon these parking spaces.
42. Tenant Work Letter. The rights and obligations of the parties
regarding construction of tenant improvements at the Premises to be
completed before the date specified in Paragraph 2, above for
commencement of the term of this Lease, are stated in the Tenant Work
Letter attached to this Lease as Exhibit B. If this Lease conflicts
with the Tenant Work Letter, the Tenant Work Letter shall prevail.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease on
the day and year first written above.
"LANDLORD"
LLL PROPERTIES, a General
Partnership
By: /S/ Xxxxxxx X. Xxxxx
"TENANT"
SONOMA NATIONAL BANK
By: /S/ Xxxxxxx X. Xxxxxxx
President and CEO
EXHIBIT B TO LEASE
WORK LETTER
This Work Letter (Work Letter) constitutes part of the lease
(Lease) dated as of the 15th day of March, 2002, between LLL Properties,
a General Partnership as Landlord, and Sonoma National Bank as Tenant.
The terms of this Work Letter are incorporated in the Lease for all
purposes.
Section 1. Defined Terms.
As used in this Work Letter, the following capitalized terms have the
following meanings:
General Contractor: Landlord's general contractor, Midstate
Construction.
Improvements: Tenant's improvements to the Premises as shown on the
Preliminary Plans, detailed in the Working Drawings and completed in
accordance with the Working Drawings and change orders thereto.
Landlord's Representative: Xxxxxxx Xxxxx, c/o Sonoma Index Tribune, 000
X. Xxxx Xxxxxx, Xxxxxx, XX 00000 (707 938-2111).
Lease: The commercial lease dated the 8th day of April, 2002 between
LLL Properties as Landlord and Sonoma National Bank as Tenant.
Preliminary Plans: The preliminary floor plans for the Premises as
shown in Exhibit A to the Lease.
Tenant's Representative: Xxxxxxx X. Xxxxxxx, President, c/o Sonoma
National Bank, 000 Xxxxxx Xxxxxx, Xxxxx Xxxx, XX 00000 (707 579-2265).
Working Drawings: Final plans and specifications and working drawings
for the construction of the Improvements that will include mechanical
and electrical plans and final architectural drawings.
Capitalized terms not otherwise defined in this Work Letter will have
the definitions set forth in the Lease or elsewhere in this Work Letter.
Section 2. Representatives.
Landlord and Tenant have designated their respective representatives as
the sole representative for each with respect to the matters set forth
in this Work Letter, with full authority and responsibility to act on
their behalf. Either party may change the representative under this
Work Letter at any time by giving three (3) days written notice to the
other party.
Section 3. Procedure and Costs.
Landlord and Tenant will comply with the procedures outlined in this
Section in preparing, delivering, and approving matters relating to the
Improvements to be constructed by and for Tenant.
(a) Working Drawings. The Preliminary Plans have previously been
approved by Landlord and Tenant. Tenant will cause Working Drawings to
be prepared and delivered to Landlord. The Working Drawings will
substantially conform to the Preliminary Plans, however, Landlord will
not unreasonably object to any logical development or refinement of the
Preliminary Plans or any changes necessitated by applicable law.
(b) Building Shell. Landlord is responsible for construction of the
building in accordance with the plans and specifications as approved by
the City and County of Sonoma pursuant to the issuance of building and
other permits for the project. Landlord will construct, at its sole
cost and expense, in accordance with all applicable codes and laws as of
the Lease Commencement Date (collectively, the "Laws") the base building
of the Premises (the "Base Building"). The Base Building shall be
constructed in accordance with the plans and specification as approved
by the City and County of Sonoma pursuant to issuance of building and
other permits for the project ("Plans and Specification"). The Base
Building shall include the following items as specified in the Plans and
Specifications:
1. Floor. Finished concrete floor.
2. Interior Walls. Insulated and fire taped sheetrock
3. Ceiling. Ready for Tenant Improvements
4. Life Safety Systems (fire sprinklers and related alarm). As
required by applicable building code for open, undemised, unoccupied
office space. Installation of demising walls by Tenant will require
modification of these systems, at Tenant's expense as described herein.
5. Electrical. Power will be provided to the main panel at the
location set forth in the Plans and Specifications, but will not be
distributed anywhere in the Premises.
6. Heating, Air Conditioning and Ventilation ("HVAC"). Primary
supply duct, return air duct and limited ceiling diffusers as provided
in the Plans and Specifications. Installation of demising walls by
Tenant will require modification of these systems, at Tenant's expense
as described herein.
7. Telephone. Main telephone terminal panel located in the
telephone/electrical area indicated on the Plans and Specifications.
Secondary branching of lines to the Premises shall be by Tenant, and all
subpanels and related telephone equipment must be located within the
Premises.
8. Water and Plumbing. Plumbing for water as provided in the
Plans and Specifications.
(c) Construction Bids. Upon their completion, Tenant will submit the
Working Drawings to the General Contractor and to such other qualified,
licensed contractors as Tenant deems appropriate, to obtain bid
proposals for construction of the Improvements. Tenant may enter into
an agreement for the construction of the Improvements with the
contractor of Tenant's choice provided the contractor employed by Tenant
and any subcontractors shall be duly licensed in California and shall be
subject to Landlord's prior approval, which shall not be unreasonably
withheld.
(d) Costs of Construction. Costs for construction of the Improvements
will be born by Tenant, except that Landlord shall provide an allowance
for construction of Tenant's improvements in an amount equal to twenty
dollars ($20.00) per rentable square foot as determined in accordance
with Paragraph 4.a. of the Lease (the "Tenant Improvement Allowance").
In no event shall Landlord be obligated to make disbursements pursuant
to this Work Letter that exceed the Tenant Improvement Allowance.
Landlord will disburse to Tenant the amount actually paid by Tenant for
the Improvements, up to the maximum of the Tenant Improvement Allowance
stated above, upon completion of construction of the Improvements and
upon the occurrence of each of the following events:
(1) Tenant delivers to Landlord properly executed mechanics'
waivers and lien releases in compliance with California Civil Code
section 3262(d)(4) (Unconditional Waiver and Release Upon Final Payment);
(2) Landlord has determined that no substandard work exists which
adversely affects the mechanical, electrical, plumbing, HVAC, life and
safety or other systems of the Building, the exterior walls of the
Building, the structure or exterior appearance of the Building, or any
other tenant's leased premises in the Building; and
(3) Architect delivers to Landlord a certificate, in form
reasonably acceptable to Landlord, certifying that the construction of
the Tenant Improvements in the Premises has been substantially
completed.
Section 4. Construction of Improvements.
Landlord and Tenant will cooperate in good faith to coordinate
construction of the Real Property and Tenant's Improvements so as, to
the extent possible, have their completion and occupancy dates coincide.
Tenant understands and acknowledges that construction of other tenants'
improvements and other factors beyond Landlord's control may make this
impossible. To this end, Landlord will, subject to the conditions in
this Work Letter, provide access to the Real Property to Tenant and
Tenant's contractor for construction of the Improvements at the earliest
possible date after commencement of the Term..
(a) Permits. Promptly following finalization of the Working Drawings,
Tenant, at Tenant's cost, will apply for and use reasonable efforts to
obtain the necessary permits and approvals to allow construction of the
Improvements. Landlord agrees to reasonably cooperate with Tenant, at
no cost to Landlord, to assist Tenant in obtaining permits.
(b) Construction. Upon receipt of entitlements, Tenant will diligently
construct and complete the Improvements substantially in accordance with
the Working Drawings. Tenant's Improvements shall comply with all
applicable Laws, as defined herein.
(c) Indemnification. Tenant will indemnify, defend (with counsel
satisfactory to Landlord), and hold Landlord harmless from all suits,
claims, actions, loss, cost, or expense (including claims for workers'
compensation, attorney fees, and costs) based on personal injury or
property damage or contract claims (including, but not limited to
mechanics' lien claims and claims for breach of warranty) arising from
the construction of the Improvements. Tenant will repair or replace (or,
at Landlord's election, reimburse Landlord for the cost of repairing or
replacing) any portion of the Real Property, Improvements or item of
Landlord's equipment or any of Landlord's real or personal property
damaged, lost, or destroyed in the construction of the Improvements.
(d) Insurance. Tenant's indemnity and insurance obligations to Landlord
as set forth in Paragraphs 16 and 17 of the Lease shall also apply with
respect to any and all costs, losses, damages, injuries and liabilities
related in any way to any act or omission of Tenant or Tenant's
contractors, subcontractor, suppliers, agents, or anyone directly or
indirectly employed by any of them, in connection with any liability of
Tenant arising out of the Improvements. Prior to commencement of
construction, and before Tenant's contractors bring any equipment or
materials to the site, Tenant's contractors will obtain and provide
Landlord with certificates evidencing Worker's Compensation, public
liability, and property damage insurance in amounts and forms and with
companies reasonably satisfactory to Landlord.
(e) Rules and Regulations. Tenant and Tenant's contractors will comply
with any other rules, regulations, or reasonable requirements that
Landlord or General Contractor may impose. Tenant's agreements with
Tenant's contractors will require each contractor to provide daily
cleanup of the construction area to the extent that cleanup is
necessitated by construction of the Improvements. Tenant, Tenant's
contractors and subcontractors shall at all times work in harmony and
not interfere with the workers, mechanics, and contractors of Landlord
or of any other tenant at the Real Property.
(f) Early Entry. Landlord will permit entry of Tenant's contractors
into the Premises, for the purposes of constructing the Improvements,
upon commencement of the Term of the Lease, but prior to the Rent
Commencement Date, subject to satisfaction of the conditions set forth
in the Lease, according to the rules and regulations of Landlord or
General Contractor described in the preceding paragraph. Landlord shall
provide Tenant's contractor with access to temporary water and power and
a construction staging area on the property.
(g) Risk of Loss. All materials, work, installations, and decorations
of any nature brought on or installed in the Premises before the
commencement of the Term will be at Tenant's risk, and neither Landlord
nor any party acting on Landlord's behalf will be responsible for any
damage, loss, or destruction.
(h) Condition of Tenant's Work. All work performed by Tenant will be
performed in a good and proper manner, will be free from defects in
design, materials, and workmanship, and will be completed in substantial
compliance with the Working Drawings.
(i) Notice of Completion; Copy of Record Set of Plans. Within ten (10)
days after completion of construction of the Improvements, Tenant shall
cause a Notice of Completion to be recorded in the office of the
Recorder of the County of Sonoma in accordance with section 3093 of the Civil
Code of the State of California or any successor statute, and shall
furnish a copy thereof to Landlord upon such recordation. If Tenant
fails to do so, Landlord may execute and file the same on behalf of
Tenant as Tenant's agent for such purpose, at Tenant's sole cost and
expense. At the conclusion of construction, Tenant shall: (i) cause
Tenant's Architect and contractor to do the following: (A) to update the
Tenant's Construction Drawings as necessary to reflect all changes made
to the Tenant's Working Drawings during the course of construction so as
to create a "record set" of plans for the Premises, (B) certify to the
best of their knowledge that the record-set of drawings are true and
correct, which certifications shall survive the expiration or
termination of this Lease, and (C) deliver to Landlord two (2) sets of
copies of such record set of drawings within ninety (90) days following
issuance of a certificate of occupancy for the Premises; and (ii) Tenant
shall deliver to Landlord a copy of all warranties, guarantees and
operating manuals and information relating to the improvements,
equipment and systems in the Premises.
Section 5. No Agency.
Nothing contained in this Letter will make or constitute Tenant as the
agent of Landlord.
Section 6. Miscellaneous.
(a) Time of the Essence. Unless otherwise indicated, all references
herein to a specific number of days shall mean and refer to calendar
days. If any item requiring approval is timely disapproved by Landlord,
the procedure for preparation of the document and approval thereof shall
be repeated until the document is approved by Landlord.
(b) Tenant's Lease Default. Notwithstanding any provision to the
contrary contained in the Lease, if an event of default, as described in
the first paragraph of Paragraph 22 of the Lease or a default under this
Work Letter has occurred at any time on or before the substantial
completion of the Improvements, then (i) in addition to all other rights
and remedies granted to Landlord pursuant to the Lease, Landlord shall
have the right to withhold payment of all or any portion of the Tenant
Improvement Allowance and (ii) all other obligations of Landlord under
the terms of this Work Letter shall be forgiven until such time as such
default is cured pursuant to the terms of the Lease (in which case,
Tenant shall be responsible for any delay in the substantial completion
of the Improvements caused by such inaction by Landlord).
In Witness Whereof, the parties have executed this Work Letter as of the
date of the Lease.
LANDLORD: LLL Properties, a General TENANT: Sonoma National
Bank
Partnership
By: /S/ Xxxxxxx X. Xxxxx
By: /S/ Xxxxxxx X. Xxxxxxx
Date: April 8, 2002
Date: April 5, 2002
Exhibit A
(not included)
5
21
EXHIBIT C
PARKING RULES AND REGULATIONS
Xxxxx-Sonoma Building
000 Xxxx Xxxx Xxxxxx, Xxxxxx, Xxxxxxxxxx
1. At no time may Tenant, its employees, agents or Customers
("Customers" means customers, clients, patrons, or retail or business
visitors of the Xxxxx-Sonoma Building, 135 West Napa Street, Sonoma)
park in the parking areas designated as "Reserved" for residential
tenants or for any other tenants of the Building.
However, on Saturdays, Sundays and national holidays the parking areas
reserved for the Sonoma Index-Tribune shall be open to use by the
general public, including Tenant, its employees and Customers.
2. If Tenant or Tenant's employee causes or allows a vehicle of Tenant
or Tenant's employee to be parked in a space which at that time is
reserved for the use of the Sonoma Index-Tribune or any other tenant of
the Building or parking facility, Landlord shall have the right to
remove or tow away the vehicle involved, without notice to Tenant,
Tenant's employee or the owner of the vehicle, and to charge the cost
associated with the removal/towing to Tenant, which cost shall be
immediately payable by Tenant upon demand by Landlord and shall be part
of the additional rent due Landlord under Tenant's Lease. Further, and
without limiting any other remedy which Landlord may pursue, Landlord
shall, after giving notice to Tenant, have the right to charge Tenant,
as additional rent payable under this Lease, the sum of Ten Dollars
($10.00) per day per car parked in violation of the provisions of this
paragraph.
If, after written notice to Tenant by Landlord, Tenant or Tenant's
employees or agents, repeatedly cause or permit material breaches of
these Parking Rules and Regulations, then Landlord shall have the right
to terminate Tenant's use of the parking facility.
No termination of parking privileges or removal or towing of a vehicle
shall create any liability on Landlord, nor shall such action be deemed
to interfere with any Tenant's right to possession of the Premises.
3. Landlord may issue parking stickers or other forms of vehicle
identification to Tenants. These forms of identification shall remain
the property of Landlord, shall be surrendered, removed, or made
unreadable by the vehicle owner at Landlord's request, and are not
transferable.
4. Vehicles must be parked entirely within the stall lines and all
directional signs, arrows and posted speed limits must be observed.
Parking is prohibited in all areas not striped for parking, in aisles
where "No Parking" signs are posted, on ramps in crosshatched areas and
in any other areas designated by Landlord. All vehicles parked in the
lot shall be locked.
5. Nothing contained in these Rules and Regulations shall be deemed to
impose liability upon Landlord for personal injury or theft, for damage
to any motor vehicle, or for loss of property from within any motor
vehicle, which is suffered by Tenant or any of its Customers, service
suppliers or Tenant's employees in connection with their use of said
parking facility.
2
