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Home My WebLink AboutSER – JOBS FOR PROGRESS, INC.A-2019-070-04 MAY 2 0 "" Memorandum of Understanding p©9AC2� ptbocah `r��'c►�t�' For Santa Ana Workforce Development Board and the SER-Jobs for Progress, Inc. MEMORANDUM OF UNDERSTANDING 1) LEGAL AUTHORITY The Workforce Innovation and Opportunity Act ("WIOA") sec. 121(c)(1) requires that each Local Workforce Development Area develop and enter into a Memorandum of Understanding ( "MOU") with each America's Job Center of California ("AJCC") Partner, consistent with WIOA Sec. 121(c)(2). This requirement is further described in the WIOA; Joint Rule for Unified and Combined State Plans, Performance Accountability, and the AJCC System Joint Provisions: Final Rule at 20 CFR 678.500, 34 CFR 361.500, and 34 CFR 463.500, and in Federal guidance. Additionally, the sharing and allocation of infrastructure costs among AJCC Partners is governed by WIOA sec. 121(h), its implementing regulations, and the Federal Cost Principles contained in the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) at 2 CFR part 200. 2) PARTIES The parties to this MOU are the City Council of the City of Santa Ana, the Santa Ana Workforce Development Board ("SAWDB"), and the SER-Jobs for Progress, Inc. ("SER"), a collocated one - stop AJCC Partner located at the Santa Ana WORK Center, 801 W. Civic Center Drive, Suite 200, Santa Ana, CA 92701. 3) PURPOSE The purpose of the MOU is consistent with the provisions of WIOA sec. 121(c)(1), to establish a cooperative working relationship between the SAWDB and SER-Jobs for Progress, Inc., the collocated AJCC Partner, and to define their respective roles and responsibilities concerning the operation of the AJCC as it relates to shared services and customers. It serves to establish the framework for providing services to employers, employees, job seekers and others needing workforce services. It also serves to establish a framework to support the established service delivery through the sharing of resources and costs. 4) DURATION This MOU shall become effective as of the date of full execution of the MOU by all Parties ("Effective Date") and terminate June 30, 2022. This MOU shall supersede and cancel the existing Phase I MOU (A-2016-137E) between SER, and the SAWDB, executed June 01, 2016, and Phase II MOU (A-2017-207) between SER, and SAWDB, executed September 01, 2017. This MOU shall also cover any and all services provided by the Partner since July 1, 2018, until the Effective Date of this current MOU. This MOU will be reviewed not less than once every three years to ensure appropriate funding and delivery of services and to identify any substantial changes that require modification of this MOU. This MOU will remain in effect until the termination date, unless one of the conditions in section 32 occurs. 5) MODIFICATIONS AND REVISIONS This MOU and its Attachments 1, 2, 3, 3-1, 4, and 5 constitute the entire agreement between the parties, and no oral understanding not incorporated herein shall be binding on any of the parties hereto. This MOU may be modified, altered, or revised, as necessary, by mutual consent of the parties, by the issuance of a written amendment, signed and dated by the parties, which may require approval by the governing body of each Party. Assignment of responsibilities under this MOU by any of the parties shall require prior written notice and preapproval of all parties. Any assignee shall also commit in writing to the terms of this MOU. 6) SANTA ANA WORKFORCE DEVELOPMENT STRATEGIES Santa Ana's vision rests on integrating current and future resources through its SAWDB Partners. Integration suggests more than partnering or assembling multiple funding sources. It means making certain that all elements of the workforce support system work together to create inviting and seamless services wherever a client enters the system. Santa Ana's vision is sensitive to the needs of its unique demographics. The SAWDB's overall strategies include: a) Identifying regional industry clusters (e.g., manufacturing cluster, medical cluster, etc.) to create new jobs in which Santa Ana's workforce can participate; b) Expanding small business development support as a creator of new jobs and method for growing the local tax base; c) Educating Santa Ana's current and future workforce through classroom pre -training and training activities, plus on-the-job training and workforce skill enhancement activities; d) Offering career pathway programs for both unemployed and employed adults and youth; e) Increasing access to jobs for disconnected and underserved populations, especially youth; _ f) Organizing, integrating and supporting social and other services through the SAWDB's network of partnerships, volunteer organizations, and established institutional resources; and, g) Assuring funding from all public, private, and other sources in support of its programs. 7) ONE -STOP SYSTEM & SERVICES A. LOCATION The AJCC is currently located in Santa Ana as follows: American Job Center (Comprehensive AJCC) Santa Ana WORK CENTER 801 W. Civic Center Drive, Suite 200 Santa Ana, CA 92701 (714)565-2600 Open to the Public: Monday — Friday 8:00 am-5:00 pm The AJCC is currently located at the Santa Ana WORK Center ("SAWC") as described in the Location of AJCC and all Partners, attached herein as Attachment 1 and incorporated herein by reference. Santa Ana ranks as the fourth densest city in the entire nation. SAWC, through its central location in downtown Santa Ana, shall provide and/or coordinate WIOA services to individuals, providing them with the necessary skills to participate in building a world -class workforce in Santa Ana. The SAWC offers the community a variety of informational, employment and training services based on individual needs. Those needs are met by the combined efforts of the SAWC Partners as described by the Santa Ana AJCC Partner Services, included herein as Attachment 2 and incorporated herein by reference. B. SERVICES PROVIDED AT THE SANTA ANA WORK CENTER Services and referrals provided at the SAWC by AJCC Partners may include, but are not limited to, the following: 1. Basic Career Services: a. Eligibility determination; b. Outreach, intake, and orientation to information and services; c. Initial assessment of skill levels, including: literacy, numeracy, and English proficiency; and, aptitudes, abilities, and support service needs; d. Labor exchange services, including: i. Job vacancy listings in labor market areas; ii. Information on job skills needed to obtain the vacant jobs; and, iii. Information relating to in -demand occupations, including earnings and opportunities for advancement; e. Provision of performance and program cost information on the Eligible Training Provider List ("ETPL") eligible programs by program and type of provider f. Provision of information in acceptable formats and languages that identify actual performance against performance accountability measures g. Provision of information related to support services h. Provision of information and assistance in filing Unemployment Insurance claims; and, i. Assistance in establishing eligibility for programs of financial aid assistance for training and education programs not funded through WIOA. 2. Individualized Career Services: a. Comprehensive and specialized assessment of skill levels and service needs including: Diagnostic testing; and, other assessment tools; b. In-depth interview and evaluation to determine barriers and goals; c. Development of Individual Employment Plan (IEP) to identify goals, objectives, and services; d. Group counseling; e. Individual counseling; f. Career planning; g. Short-term pre -vocational services, including: development of learning skills; communication skills; and, other soft skills to prepare individuals for employment or training; rd h. Workforce preparation activities, including: basic academic; and, obtaining other skills necessary for successful transition into postsecondary education, training or employment; i. Financial literacy services; and, j. Out -of -area job search assistance and relocation assistance. 3. Training Services: a. Occupational skills training; b. On -the -Job training; c. Incumbent worker training; d. Programs that combine workplace training with related instruction, which may include cooperative education programs; e. Training programs operated by the private sector; f. Skill upgrading and retraining; g. Entrepreneurial training programs; h. Transitional jobs; i. Job readiness training provided in combination with any of the aforementioned training Services; j. Adult education and literacy activities, including: activities of English language acquisition; and, integrated education and training programs provided concurrently or in combination with any of the aforementioned training services; k. Customized training; 1. Internships and work experiences that are linked to careers; and, m. English language acquisition and integrated education and training program. 4. Employer Services: a. Recruitment and other business services on behalf of employers. C. SYSTEM STRUCTURE 1. AJCC ONE -STOP OPERATOR PROCUREMENT The SAWDB will procure the AJCC Operator through a competitive process in accordance with the Uniform Guidance Cost Principles contained in the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards at 2 CFR part 200 (Uniform Guidance), including the Office of Management and Budget's (OMB) approved exceptions for the U.S. Department of Labor at 2 CFR part 2900, WIOA and its implementing regulations, and local procurement laws and regulations. All documentation for the competitive AJCC operator procurement will be available for public inspection. The State requires that the AJCC operator is re -competed at least every three years and no later than every four years. 2. ROLES AND RESPONSIBILITIES OF PARTIES a. Provision of Applicable Career Services and Participation in Planning and Development. The parties to this MOU will work closely together to ensure that the AJCC is a high -performing work place with staff that ensure quality of service. The AJCC Partner has indicated they shall provide an array of applicable career services to clients as set forth in the Santa Ana AJCC Partner 5 Services. The AJCC Partner agrees to the responsibilities required of all Partners under WIOA Section 121(b). In addition, the AJCC Partners will participate in joint planning, plan development, and modification of activities to accomplish the following: i. Continuous partnership building; ii. Continuous planning in response to state and federal requirements; and, iii. Responsiveness to local and economic conditions, including employer needs. Parties agree to the co -enrollment of mutual customers in case management to better leverage the resources available for the benefit of the participant and enhance successful outcomes and participate in the operation of the one -stop system consistent with the terms of the MOU and requirements of authorized laws. Both parties agree to inform each other immediately when a customer violates an established policy that would require them to be banned from the center or behavior that requires police intervention. Parties agree to collaborate and reasonably assist each other in the development of necessary service delivery protocols for the services outlined in this MOU. Parties agree that the provisions contained herein are made subject to all applicable federal and state laws, implementing regulations, and guidelines imposed on either or all the parties relating to privacy rights of customers, maintenance of records, and other confidential information relating to customers. Parties agree that all equipment and furniture purchased by any party for purposes described herein shall remain the property of the purchaser after the termination of this MOU. b. Parties shall comply with: i. Section 188 of the WIOA Nondiscrimination and Equal Opportunity Regulations (29 CFR Part 38; Final Rule, published December 2, 2016); ii. Title VI and VII of the Civil Rights Act of 1964 (Public Law 88-352), as amended; iii. Section 504 of the Rehabilitation Act of 1973, as amended; iv. The Americans with Disabilities Act of 1990, as amended; V. The Jobs for Veterans Act (Public Law 107-288) pertaining to priority of service in programs funded by the U.S. Department of Labor; vi. Training and Employment Guidance Letter (TELL) 37-14, Update on Complying with Nondiscrimination Requirements: Discrimination Based on Gender Identity, Gender Expression and Sex Stereotyping are Prohibited Forms of Sex Discrimination in the Workforce Development System and other guidance related to implementing WIOA sec. 188; vii. The Non-traditional Employment for Women Act of 1991; viii. The Age Discrimination Act of 1967, as amended; ix. The Age Discrimination Act of 1975, as amended; X. Title IX of the Education Amendments of 1972, as amended; xi. The Family Educational Rights and Privacy Act (FERPA) (20 U.S.C. § 1232g; 34 CFR part 99); xii. Title IX of the Education Amendments of 1972, as amended; xiii. Confidentiality requirements governing the protection and use of personal information held by the VR agency (34 CFR 361.38); xiv. The confidentiality requirements governing the use of confidential information held by the State UI agency (20 CFR part 603); and, xv. All amendments to each, and all requirements imposed by the regulations issued pursuant to these acts. The Parties agree to inform each other immediately when a customer violates an established policy that would require them to be banned from the center or activity that requires policy intervention. 8) COLLOCATED AJCC PARTNER RESPONSIBILITIES Partner commits to collocation of staff, as appropriate, and to providing other professional learning opportunities that promote continuous quality improvement. Partner will further promote system integration to the maximum extent feasible through: a. Effective communication, information sharing, and collaboration with the AJCC operator; b. Joint planning, policy development, and system design processes; c. Commitment to the joint mission, vision, goals, strategies, and performance measures; d. The design and use of common intake, assessment, referral, and case management processes; e. The use of common and/or linked data management systems and data sharing methods, as appropriate; f. Leveraging of resources, including other public agency and non-profit organization services; g. Participation in a continuous improvement process designed to boost outcomes and increase customer satisfaction; and h. Participation in regularly scheduled Partner meetings to exchange information in support of the above and encourage program and staff integration. Partner shall provide applicable career services to clients as set forth in the Santa Ana AJCC Partner Services. 9) REFERRALS The primary principle of the referral system is to provide integrated and seamless delivery of services to workers, job seekers, and employers. In order to facilitate such a system, Partners will ensure and agree to: a. Familiarize themselves with the basic eligibility and participation requirements, as well as with the available services and benefits offered, for each of the Partners' programs represented in the AJCC network; b. Develop materials summarizing their program requirements and making them available for Partners and customers; c. Develop and utilize common intake, eligibility determination, assessment, and registration forms, as appropriate; d. Provide substantive referrals to customers who are eligible for supplemental and complementary services and benefits under Partner programs; e. Regularly evaluate ways to improve the referral process, including the use of customer satisfaction surveys; f. Commit to robust and ongoing communication required for an effective referral process; g. Commit to actively follow up on the results of referrals and assuring that Partner resources are being leveraged at an optimal level; h. Ensure that intake and referral processes are customer -centered with the intent to provide high quality customer service; Ensure that general information regarding AJCC programs, services, activities, and resources shall be made available to all customers as appropriate; j. Ensure that referrals will be made via email or other electronic means; k. Ensure that referrals will include a direct link or access to other AJCC Partner staff that can provide meaningful information or service, through the use of co -location, or real-time technology (two-way communication and interaction with AJCC Partners that results in services needed by the customer); and, Ensure that the referral process will include specific staff name, the activity required, desired outcome and a method for communicating back to the referring agency that the service need was addressed. H 10) SUPERVISION/DAY TO DAY OPERATIONS a. Day -to -Day Supervision The day-to-day supervision of staff assigned to the AJCCs will be the responsibility of the site supervisor(s). Partner will continue to set the priorities of its staff assigned to the AJCC. Any change in work assignments or any concerns involving the responsibilities of the parties which occur at the worksite will be handled by the site supervisor(s) and Partner management. b. Santa Ana WORK Center Hours of Operation The SAWC is open for business: Monday through Friday from 8:00 am until 5:00 pm. c. Partner Staff Office Hours The office hours for Partner staff at the AJCC will be established by the Partner. All Partner staff will comply with their corresponding holiday schedule and will provide a copy of their holiday schedule to the SAWDB and SAWC at the beginning of each fiscal year. d. Building Accessibility All Partner staff assigned to the SAWC will be issued an access card to SAWC suite 200 and a parking lot pass that allows them to enter and exit the parking lot. It is all individual staff s responsibility to keep them secure. Should they damage or lose them they can be replace by the SAWDB at the expense of the individual agency staff. e. Benefits Each party shall be solely liable and responsible for providing to, or on behalf of, its employee(s), all legally -required employee benefits. In addition, each party shall be solely responsive and hold all other parties harmless from all matters relating to payment of each party's employee(s), including compliance with social security withholding, workers' compensation, and all other regulations governing such matters. 11) AJCC OPERATING BUDGET The purpose of this section is to establish a financial plan, including terms and conditions, to fund the services and operating costs of the local AJCC. The parties to this MOU agree that joint funding is a necessary foundation for an integrated service delivery system. The goal of the operating budget is to develop a funding mechanism that: a. Establishes and maintains the Local workforce delivery system at a level that meets the needs of the job seekers and businesses in the Local area; b. Reduces duplication and maximizes program impact through the sharing of services, resources, and technologies among Partners (thereby improving each program's effectiveness); c. Reduces overhead costs for any one Partner by streamlining and sharing financial, procurement, and facility costs; d. Ensures that costs are appropriately shared by AJCC Partners by determining contributions based on the proportionate use of the AJCC centers and relative benefits received, and requiring that all funds are spent solely for allowable purposes in a manner consistent with the applicable authorizing statutes and all other applicable legal requirements, including the Uniform Guidance; and, e. All parties will meet and confer regarding replacement, acquisition, cleaning and maintenance of furnishings. The parties consider this AJCC operating budget the master budget that is necessary to maintain the SAWDB's high -standard AJCC. It includes the following cost categories, as required by WIOA and its implementing regulations: a. Infrastructure costs (also separately outlined below in the Infrastructure Funding Agreement); b. Career services; and c. Shared services. All costs must be included in the MOU, allocated according to the AJCC Partner's proportionate use and relative benefits received, reconciled every six (6) months against actual costs incurred, and adjusted accordingly. The AJCC operating budget is expected to be transparent and negotiated among Partners on an equitable basis to ensure costs are shared appropriately. All Partners must negotiate in good faith and seek to establish outcomes that are reasonable and fair. All Partners must adhere and reference the rules and regulations included in the executed Office Lease, attached hereto as Attachment 5 and incorporated herein by reference. 12) INFRASTRUCTURE FUNDING AGREEMENT The Infrastructure Funding Agreement ("IFA") contains the infrastructure costs budget that is an integral component of the overall AJCC operating budget. The IFA is a mandatory component of the local MOU, described in WIOA sec. 121(c) and 20 CFR 678.500 and 678.755. The IFA contains the AJCC Comprehensive Infrastructure Budget, and Other System Cost Budget, included herein as Attachment 3 and incorporated herein by reference, that is an integral component of the overall AJCC operating budget. The other component of the IFA is the Applicable Career Services, attached herein as Attachment 3-1 and incorporated herein by reference, which includes the shared operating costs and shared services. The overall AJCC operating budget includes the Comprehensive Cost Allocation and Partner Contributions, attached herein as Attachment 4 and incorporated herein by reference. AJCC infrastructure costs are defined as non -personnel costs that are necessary for the general operation of the AJCC, including, but not limited to: a. Rental of the facilities; b. Utilities and maintenance; 10 c. Equipment, including assessment -related products and assistive technology for individuals with disabilities; and, d. Technology to facilitate access to the AJCC, including technology used for the center's planning and outreach activities. Changes in the AJCC Partners or an appeal by an AJCC Partner's infrastructure cost contributions will require an amendment of the MOU. 13) COST ALLOCATION METHODOLOGY The purpose of this infrastructure cost sharing methodology is to summarize, in writing, the methods and procedures that the SAWDB will use to share costs with the AJCC Partner. The AJCC Partner agrees that it will be charged on a monthly basis according to the following cost sharing methodology, and that monthly payment will be submitted within the first ten (10) calendar days of each month. 14) INFRASTRUCTURE COST ALLOCATION METHODOLOGY a. Rent Costs: Rent costs shall be based only on the base rent. The base rent is derived from the total assigned square footage, calculating the percentage of usage by AJCC Partner and applying that percentage to the common area square footage. Assigned square footage plus the percentage of common area square footage equals total square footage for each AJCC Partner. Total square footage for each AJCC Partner multiplied by the base rent per square foot equals total base rent for each AJCC Partner as indicated in the AJCC Comprehensive Infrastructure Budget, and Other System Cost Budget and the Comprehensive Cost Allocation and Partner Contributions. The base rent has an annual increase of no more than 3% over the five-year life of the Office Lease document (Attachment 5 attached herewith and incorporated herein by reference). b. Utilities and Maintenance: This section includes only telephone services, which includes voice -mail on AJCC Partners' phones. Costs for staff phones are charged based on the AJCC Partner's assigned space. Common area phones will be charged according to space allocation. c. Telephones: Telephone costs include the cost of purchasing and installing a new phone system utilized by the AJCC Partners. Telephone costs are based on the actual cost for telephones in assigned spaces. Common area telephones are allocated based on percentage of space allocation. d. Technology and Internet Access Costs: Installation of Network Wireless Bridge will be a monthly charge based on costs from the vendors. The cost per AJCC Partner is derived from the calculation of total percentage of space used by each AJCC Partner. Recurring monthly charges for Internet, Wi-Fi and other technology charges are allocated based on the percentage of total space allocated. Access Card System installation and programing of the key card system, Data & Phone cabling and Switches will be a monthly charge to all collocated Partners based on allocated space. 15) INFRASTRUCTURE CONTRIBUTIONS The AJCC Partner may provide cash, non -cash (in- kind), and third -party in -kind contributions to cover its share of infrastructure costs. In -kind contributions cannot be used to fund non- 11 infrastructure costs (such as personnel), and must be valued consistent with Uniform Guidance Section 200.306 to ensure such contributions are fairly evaluated and qualify for the AJCC Partner's proportionate share. If third -party in -kind contributions are made to support the AJCC as a whole (such as facility space), that contribution will not count toward the AJCC Partner's proportionate share of the infrastructure. Rather, the value of the contribution will be applied to the overall infrastructure budget prior to determining proportionate amounts and thereby reduce the contribution required for all AJCC Partners. a. Cash Cash funds provided to the SAWDB, or its designee, by AJCC Partners, either directly or by an interagency transfer, or by a third party. b. Non -Cash Expenditures incurred by AJCC Partners on behalf of the AJCC; and Non -cash contributions or goods or services contributed by a Partner program and used by the AJCC. c. Third party In -kind Contributions of space, equipment, technology, non -personnel services, or other like items to support the infrastructure costs associated with AJCC operations, by a non-AJCC Partner to: Support the AJCC in general; or, Support the proportionate share of AJCC infrastructure costs of a specific Partner [20 CFR 678.720; 20 CFR 678.760; 34 CFR 361.720; 34 CFR 361.760; 34 CFR 463.720; and 34 CFR 463.760]. 16) OTHER AJCC DELIVERY SYSTEM COSTS In compliance with WIOA Joint Rule Section 678.760, the AJCC Partners will use a portion of funds made available under their authorizing federal statute (or fairly evaluated in -kind contributions) to share the additional costs relating to the operation of the One -Stop delivery system. These costs may be shared through cash, non -cash, or third -party in -kind contributions. As required by WSD16-09, the amount of funds that the AJCC Partner has budgeted to expend on applicable career services and other shared services, which cumulatively with the other AJCC Partners budgeted amounts shall form the Comprehensive Cost Allocation and Partner Contributions. a. Career Services Applicable to the AJCC Partner The AJCC Partner shall provide applicable career services to clients as set forth in the Santa Ana AJCC Partner Services. The agreed upon Applicable Career Services Budget is set forth in Attachment 3-1 attached hereto and incorporated herein by reference. This budget consists of the AJCC Partner's costs for the service delivery of each applicable career service indicated in the Santa Ana AJCC Partner Services. b. Required Consolidated Budget for the Delivery of "Applicable Career Services" The other system costs budget must be a consolidated budget for applicable career services. This budget must include each of the Partner's costs for the service delivery of each applicable career 12 service and a consolidated system budget for career services applicable to more than one Partner as indicated in the Comprehensive Cost Allocation and Partner Contributions. AJCC Partners understand that while only collocated Partners share infrastructure costs, at this time, all AJCC Partners must share in other System costs through non -cash (in -kind) contributions as set forth herein. 17) DATA SHARING Parties agree that the use of high -quality, integrated data is essential to inform decisions made by policymakers, employers, and job seekers. Additionally, it is vital to develop and maintain an integrated case management system, as appropriate, that informs customer service throughout customers' interaction with the integrated system and allows information collected from customers at intake to be captured once. Parties further agree that the collection, use, and disclosure of customers' personally identifiable information (PII) is subject to various requirements set forth in Federal and State privacy laws. Partners acknowledge that the execution of this MOU, by itself, does not function to satisfy all of these requirements. All data, including customer PII, collected, used, and disclosed by Partners will be subject to the following: a. Customer PII will be properly secured in accordance with the SAWDB's policies and procedures regarding the safeguarding of PII; b. The collection, use, and disclosure of customer education records, and the PII contained therein, as defined under FERPA, shall comply with FERPA and applicable State privacy laws; c. All confidential data contained in Unemployment Insurance wage records must be protected in accordance with the requirements set forth in 20 CFR part 603; d. All personal information contained in Vocational Rehabilitation records must be protected in accordance with the requirements set forth in 34 CFR 361.38; e. Customer data may be shared with other programs, for those programs' purposes, within the AJCC network only after the informed written consent of the individual has been obtained, where required; Customer data will be kept confidential, consistent with Federal and State privacy laws and regulations; and, g. All data exchange activity will be conducted in machine readable format, such as HTML or PDF, for example, and in compliance with Section 508 of the Rehabilitation Act of 1973, as amended (29 U.S.C. § 794 (d)). 13 All AJCC and Partner staff will be trained in the protection, use, and disclosure requirements governing PII and any other confidential data for all applicable programs, including FERPA- protected education records, confidential information in UI records, and personal information in VR records. 18) CONFIDENTIALITY All parties expressly agree to abide by all applicable Federal, State, and local laws and regulations regarding confidential information, including PII from educational records, such as but not limited to 20 CFR Part 603, 45 CFR Section 205.50, 20 USC 1232g and 34 CFR part 99, and 34 CFR 361.38, as well as any applicable State and local laws and regulations. Each party will ensure that the collection and use of any information, systems, or records that contain PII and other personal or confidential information will be limited to purposes that support the programs and activities described in this MOU and will comply with applicable law. Each party will ensure that access to software systems and files under its control that contain PII or other personal or confidential information will be limited to authorized staff members who are assigned responsibilities in support of the services and activities described herein and will comply with applicable law. Each party expressly agrees to take measures to ensure that no PII or other personal or confidential information is accessible by unauthorized individuals. To the extent that confidential, private, or otherwise protected information needs to be shared amongst the parties for the parties' performance of their obligations under this MOU, and to the extent that such sharing is permitted by applicable law, the appropriate data sharing agreements will be created and required confidentiality and ethical certifications will be signed by authorized individuals. With respect to confidential unemployment insurance information, any such data sharing must comply with all of the requirements in 20 CFR Part 603, including but not limited to requirements for an agreement consistent with 20 CFR 603.10, payments of costs, and permissible disclosures. With respect to the use and disclosure of FERPA-protected customer education records and the PII contained therein, any such data sharing agreement must comply with all of the requirements set forth in 20 U.S.C. § 1232g and 34 CFR Part 99. With respect to the use and disclosure of personal information contained in VR records, any such data sharing agreement must comply with all of the requirements set forth in 34 CFR 361.38. 19) PRESS RELEASES AND COMMUNICATIONS All parties shall be consulted and notified prior to communicating with the press, television, radio or any other form of media regarding its duties or performance under this MOU. Participation of each party in press/media presentations will be determined by each party's public relations policies. The parties agree to utilize the AJCC logo developed by the State of California and the SAWDB on buildings identified for AJCC usage. 14 20) ACCESSIBILITY Accessibility to the services provided by the AJCCs and all Partner agencies is essential to meeting the requirements and goals of the local AJCC network. Job seekers and businesses must be able to access all information relevant to them via visits to physical locations as well as in virtual spaces, regardless of gender, age, race, religion, national origin, disability, veteran's status, or on the basis of any other classification protected under state or federal law. 21) NON-DISCRIMINATION AND EQUAL OPPORTUNITY All parties to this MOU certify that they prohibit, and will continue to prohibit, discrimination, and they certify that no person, otherwise qualified, is denied employment, services, or other benefits on the basis of: (i) political or religious opinion or affiliation, marital status, sexual orientation, gender, gender identification and/or expression, race, color, creed, or national origin; (ii) sex or age, except when age or sex constitutes a bona fide occupational qualification; or (iii) the physical or mental disability of a qualified individual with a disability. 22) GRIEVANCES AND COMPLAINTS PROCEDURE The AJCC Partner agrees to establish and maintain a procedure for grievance and complaints as outlined in WIOA. The process for handling grievances and complaints is applicable to customers and Partners. These procedures will allow the customer or entity filing the complaint to exhaust every administrative level in receiving a fair and complete hearing and resolution of their grievance. The Partner further agrees to communicate openly and directly to resolve any problems or disputes related to the provision of services in a cooperative manner and at the lowest level of intervention possible. All Partners agree to inform each other immediately when a customer violates an established policy that would require them to be banned from the center or involves police authorities. 23) AMERICAN'S WITH DISABILITIES ACT AND AMENDMENTS COMPLIANCE The AJCC Partner agrees to ensure that the policies and procedures as well as the programs and services provided at the AJCC are in compliance with the Americans with Disabilities Act ("ADA") and its amendments. Additionally, the SAWDB and the AJCC Partners will ensure that policies and procedures established by the SAWDB and the AJCC Partners are in compliance with the ADA. 24) HOLD HARMLESS/INDEMNIFICATION/LIABILITY In accordance with provisions of Section 895.4 of the California Government Code, each signatory hereby agrees to indemnify, defend and hold harmless all other signatories identified in this MOU from and against any and all claims, demands, damages and costs arising out of or resulting from any negligent acts or omissions which arise from the performance of the obligations by such indemnifying party pursuant to this MOU. In addition, except for Departments of the State of California which cannot provide for indemnification of court costs and attorney's fees under the indemnification policy of the State of California, all signatories to this MOU agree to indemnify, defend and hold harmless each other from and against all court costs and attorney's fees arising out of or resulting from any negligent acts or omissions which arise from the performance of the 15 obligations by such indemnifying party pursuant to this MOU. It is understood and agreed that all indemnity provided herein shall survive the termination of this MOU. 25) SEVERABILITY If any part of this MOU is found to be null and void or is otherwise stricken, the rest of this MOU shall remain in force. 26) DRUG AND ALCOHOL -FREE WORKPLACE All parties to this MOU certify they will comply with the Drug -Free Workplace Act of 1988, 41 U.S.C. 702 et seq., and 2 CFR part 182 which require that all organizations receiving grants from any Federal agency maintain a drug -free workplace. The recipient must notify the awarding office if an employee of the recipient is convicted of violating a criminal drug statute. Failure to comply with these requirements may be cause for suspension or debarment under 2 CFR part 180, as adopted by the U.S. Department of Education at 2 CFR 3485, and the U.S. Department of Labor regulations at 29 CFR part 94. 27) CERTIFICATION REGARDING LOBBYING All parties shall comply with the Byrd Anti -Lobbying Amendment (31 U.S.C. Sectionl352), 29 C.F.R. Part 93, and 34 CFR part 82, as well as the requirements in the Uniform Guidance at 2 CFR 200.450. The parties shall not lobby federal entities using federal funds and will disclose lobbying activities as required by law and regulations. 28) DEBARMENT AND SUSPENSION All parties shall comply with the debarment and suspension requirements (E.0.12549 andl2689) and 2 CFR part 180 and as adopted by the U.S. Department of Labor at 29 CFR part 2998 and by the U.S. Department of Education at 2 CFR 3485. 29) PRIORITY OF SERVICE All parties certify that they will adhere to all statutes, regulations, policies, and plans regarding priority of service, including, but not limited to, priority of service for veterans and their eligible spouses, and priority of service for the WIOA title I Adult program, as required by 38 U.S.C. sec. 4215 and its implementing regulations and guidance, and WIOA sec. 134(c)(3)(E) and its implementing regulations and guidance. Partners will target recruitment of special populations that receive a focus for services under WIOA, such as individuals with disabilities, low-income individuals, basic skills deficient youth, and English language learners. 30) BUY AMERICAN PROVISION Each party that receives funds made available under title I or II of WIOA or under the Wagner- Peyser Act (29 U.S.C. Section 49, et. seq.) certifies that it will comply with Sections 8301 through 8303 of title 41 of the United States Code (commonly known as the "Buy American Act.") and as referenced in WIOA Section 502 and 20 CFR 683.200(f). 16 31) SALARY COMPENSATION AND BONUS LIMITATIONS Each party certifies that, when operating grants funded by the U.S. Department of Labor, it complies with TEGL 05-06, Implementing the Salary and Bonus Limitations in Public Law 109- 234, TEGL 17-15, Workforce Innovation and Opportunity Act (WIOA) Adult, Dislocated Worker and Youth Activities Program Allotments for Program Year (PY) 2017; Final PY 2017 Allotments for the Wagner-Peyser Act Employment Service (ES) Program Allotments; and Workforce Information Grants to States Allotments for PY 2017, Public Laws 114-113 (Division H, title I, Section 105) and 114-223, and WIOA section 194(15)(A), restricting the use of federal grant funds for compensation and bonuses of an individual, whether charged to either direct or indirect, at a rate in excess of the Federal Office of Personnel Management Executive Level II. 32) TERMINATION This MOU will remain in effect until the end date specified in section 4 above, unless: a. Federal oversight agencies charged with the administration of WIOA are unable to appropriate funds or if funds are not otherwise made available for continued performance for any fiscal period of this MOU succeeding the first fiscal period. Any party unable to perform pursuant to MOU due to lack of funding shall notify the other parties as soon as the party has knowledge that funds may be unavailable for the continuation of activities under this MOU; b. WIOA is repealed or superseded by subsequent federal law; c. Local area designation is changed under WIOA; and, d. A party breaches any provision of this MOU and such breach is not cured within thirty (30) days after receiving written notice from the SAWD13 Chair (or designee) specifying such breach in reasonable detail. In such event, the non -breaching party(s) shall have the right to terminate this MOU by giving written notice thereof to the party in breach, upon which termination will go into effect immediately. In the event of termination, the parties to the MOU must convene within thirty (30) calendar days after the breach of the MOU to discuss the formation of the successor MOU. At that time, allocated costs must be addressed. This MOU is of no force or effect until signed by authorized representatives of the participating parties, and approved by the Chief Local Elected Official or his/her designee. The MOU, once signed, becomes part of the local WIOA Plan. Any party may withdraw from this MOU by giving written notice of intent to withdraw at least thirty (30) calendar days in advance of the effective withdrawal date. If agreed to by all parties, the timeframes for notice may be reduced or extended. Notice of withdrawal shall be given to the SAWDB at the address listed in the signed attachments of this MOU, and to the contact person so listed, considering any information updates received by the parties, a courtesy notification shall be made to all parties of this MOU in a timely manner. 33) NOTICES All notices, requests, claims, correspondence, reports, statements authorized or required by this Agreement, and/or other communications shall be addressed as follows: 17 City of Santa Ana: City of Santa Ana Administration Services 801 W. Civic Center Dr., Suite 200 Santa Ana, CA 92701 Partner: SER-Jobs for Progress, Inc. 255 N. Fulton St. #106 Fresno, CA 93701 34) INSURANCE The AJCC Partners agree that their current in force insurance or self-insurance coverage programs shall apply to their operations performed under the Workforce Innovation Opportunity Act and at the SAWC, including commercial general liability, property damage liability, business personal property, workers' compensation and employee dishonesty/crime coverages. The City of Santa Ana shall be named as additional insured for such insurance and the coverage shall be primary and non-contributory with regard to the City. 35) AUTHORITY AND SIGNATURES The individuals signing this MOU and its attachments, which are incorporated herein by reference, have the authority to commit the party they represent to the terms of this MOU, and do so commit by signing. ATTACHMENTS Attachment 1: AJCC Partners Location and Map Attachment 2: Santa Ana AJCC Partner Services Attachment 3: AJCC Comprehensive Infrastructure Budget, and Other System Cost Budget Attachment 3-1: Applicable Career Services Attachment 4: Comprehensive Cost Allocation and Partner Contributions Attachment 5: Office Lease W-1 THIS MEMORANDUM OF UNDERSTANDING is herchy slimed and agreed to on the date first written above, FOR THE CITY OF SANTA ANA Attest: Norma Mitre, Acting Clerk of the Council Recommended forApprovalt Steven A. Mendoza Executive Director Community Development Agency City of Santa .Ano: Steven A. Mendoza, Acting City Manager Approved as to Form: Sonia R. Carvalho, City Attorney Ryan O. Hodge, Assistant City Attorney FOR SANTA ANA WORKFORCE. DEVELOPMENT BOARD Stacey Sanchez, Chair FOR AMERICA'S JOB CENTER OF CALIFORNIA PARTNER SER-.lobs for Progress, Inc AIC P rtner .mneales, SCS _ PDirector JJ Date 234N NuYi7sirSt:—il}l3Fr.^rl`iesn Address 19 THIS MEMORANDUM OF UNDERSTANDING is hereby signed and agreed to on the date first written above. FOR THE CITY OF SANTA ANA Attest: Recommended for Approval: City of Santa Ana: Kristine Ridge. City Manager as to Form: u-41ho, City Attorney Steven A. Mendoza, Executive Director Ry O Ho*, Assistant City Attorney Community Development Agency FORSANTA ANA&WORKFORCE DEVELOPMENT BOARD Stacey Sanchez, Chair FOR AMERICA'S JOB CENTER OF CALIFORNIA PARTNER SER-Jobs for Progress, Inc. AJCC Partner Esteban Gonzales, SCSEP Director 255 N. Fulton St. #106, Fresno. CA 93701 Address Date 19 Attachment 1 AJCC Partners Location and Map Partner Program Partner Authorization/Category Physically Organization Co -Located Title I Adult, Dislocated City of Santa Ana Workers and Youth WIOA Title Adult, Dislocated Workers, Youth Yes Programs programs Rancho Santiago WIOA title II Adult Education and Family Adult Education/ Community College Literacy Act (AEFLA) program Career and technical education (CTE) Literacy and Carl Perkins District Career Technical programs at the postsecondary level, No Education authorized under the Carl D. Perkins Career and Technical Education Act of 2006 (20 U.S.C. 2301 et seq.) Wagner-Peyser Employment WIOA title III Wagner-Peyser Employment Development Services, authorized under the Wagner-Peyser Yes Department (EDD) Act (29 U.S.C. 49 et seq.), also providing the state's public labor exchange. Employment Jobs for Veterans State Grants (1VSG), Veterans Development authorized under chapter 41 of title 38, U.S.C. Yes Department (EDD) Employment Trade Adjustment Assistance (TAA), Trade Act Development authorized under chapter 2 of title II of the Yes Department (EDD) Trade Act of 1974 (19 U.S.C. 2271et seq.) Unemployment Employment Unemployment Insurance (UI) programs under Insurance (UI) Development state unemployment compensation laws. No Department (EDD) State Department of WIOA title IV State Vocational Rehabilitation Vocational Rehabilitation program authorized under title I of the Yes Rehabilitation Services Rehabilitation Act of 1973 (29 U.S.C. 720 et seq.) Temporary Assistance Social Service Temporary Assistance for Needy Families for Needy Families Agency -Family Self- (TANF), authorized under part A of title IV of Yes (TANF) Sufficiency the Social Security Act (42 U.S.C. 601 et seq.) Senior Aid Program Senior Community Service Employment Senior Aid Program Regions II & III Program (SCSEP), authorized under title V of Yes SER-Jobs for the Older Americans Act of 1965 (42 U.S.C. Progress, Inc. 3056 et seq.) Job Corps Long Beach Job Corps WIOA Title I C, Jobs Corps No Native American Southern California Indian and Native American Programs (Section Programs Indian Center 166) No Housing & Urban Santa Ana Housing Housing & Urban Development (HUD) Yes Development Authority Adult Demonstration Orange County Reentry Employment Opportunities (EO) Sheriff's Department programs authorized under sec. 212 of the No Second Chance Act of 2007 (42 U.S.C. 17532) and WIOA sec. 169 SANTA ANA WORK CENTER AMERICA'S JOB CENTER OF CALIFORNIA AND ITS PARTNERS BL. r r r- ;o Santa Ana WORK Center America's Job Center of California 801 W. Civic Center Dr. Santa Ana, CA 92701 Partners: Employment Development Department State Department of Rehabilitation O.C. Social Services Agency Goodwill Industries SER/Senior Aid Program Learn4Life Eal BL EDINGER AV. F e OCentennial Adult Education 2900 W. Edinger Ave. Santa Ana, CA 92704 Santa Ana College 3 1530 W. 17th St. Santa Ana, CA 92706 College & Workforce ®Preperation Center 1572 N. Main St. Orange, CA 92867 PL. State Department of ©Rehabilitation 709The City Drive, Suite 110 Orange, CA 92868 Social Services Agency ' 6 1, 1928 S. Grand Ave. Santa Ana, CA 92706 OCTE/ROP Valley High School 1$01 S. Greenville Santa Ana, CA 92704 LA VETA Long Beach Job Corps ® 1903 Santa Fe Ave. Long Beach, CA 90810 Asian American Senior Center 850 N. Birch St. Santa Ana, CA 92701 Remington Education Center 1325 E. 4th St. Santa Ana, CA 92701 Attachment 1 d d V N B IL V u Q Q z Q F- z Q N ( o O a C0 « a a a m m a m O F w ri �i LL a Q a m a O co cD ao o r of n w r z vi ^, n a IR o a E M m m m 9 m W N N N N N bn N 00 e-I W 00 c-I N C N > •O 01 �_ 00 w a L � Ol � lA F- N N M n 0 O1 61 N 00 d^ O M 01 M 00 N Mpn Ou .0 t c-I c-I rl ® N 00 `~ i4 e-I i-1 W vV Ft a L6 N � ti Ln a o a n c H N b. N L w m ti r N ti M ti o a) al M I� r-I H N N U O N O O^ O 00 c-I @ 00 M N ai Oi O L% tf1 N^ OO 0D uj 00 c-I H N cu H O lD lD ci lD Lr 00 00 W e N d� Lr ul Lr tl' ^ u%l 00 Rl h ci -zi M -e r-I M M a M O e-I ci M M M N` 72N OO = M c N cu E E E E H = E in a a a Q T U c o w QL c v v> 0 a> O 0> O a> O o t u v m w u @ c Ln a H fODa 0 0® O w O O E H 9 m O O -0w O ® @ Y U Y Y Y Y Y Y Y Y t: Lr U V1 Y U (Ua)OJ O cu w CL M 9 @ to C E N In G� UI @ CU C T C E 0. O_ O- �. O- O_ O- G, a0+ L @ ._ U ® O b0 0n c 0 @ O E v E ai E v E v Y w o m a v w o c a U K U W O W® W O W® V9 K V1 LL U N C a N U 2 c @ c (, o >. w w E m e u c u H w E 0) Y i > = O O U w 1�0 E O a, .. H E m = r m U an O Z} J w a! O — 0. c o o_� aQi v u H @' ° Y C = @ a Y E w a, w ai 1 7 3 -a 0. u u O @ Y C w LD E H OYJ E Lw@ .m N N= E LL 0. u > U > N o h Q > > > z 2 F- Q h U w h° .�0., q U w U q .u. sui GL U 71 5 b y o � .� a � � ai � a.'S� •� ro vZi .0 �' � •� � 0 � o •ti ,� ro o q o U d 78ti 44 o ° o O •° o o• 5 q a T Fi' •q b p� b a0' � ,U �n .O `3 � 'N t�C � CL •4+ U U O }c�U7 � ~ Val (U/] A �' � AI e� y? Y o a a° bqA '5 yro� Y Y O �• Q O P ^ d P, y T ti bq• W O w O b ° O W O w U O w Y y � J � f❑NB Ul Fn Vj � .ry P9 Y❑ ro � '3 y YO %�+ cUi O cUi ram. PrUsl N aJ pq ° O w° U ° q �b �p U•� ice. bo.� O CC o,o N o n U R 0W0°'� U� .q M � � � "' ice-` � y � � yy •� U ITS a a0 .4 5 5 CIS .0 CIS v u o O U, 1pz O E4 .0 b y C, N '❑O °ab~A el N u M C W r �n Q M a 05 U 1�tyy, U U �y cd O �'i �3 rai O •� Op � a � O y U U W y0 o u d '0 °n p 0 a�' U Fb Ad, pro. o O U G �y U t N cd U }y '•o d' vi n� M N c c CD E U � a O O O ° � O U q q � ° q U w � � o U cUy q U ai wo a � a N c El O Y Fes, p c� O N �Syi U a U 3 o o o q yyo � O pro a; 51 A °a. 0 h 14 N M _ C4 k ) 2 . ( �()ks / ) j \\\C)�7ƒ a kj>/}\\ \w*5! } 2§®a%* j\))}}/} uo P64 � c ) k 2 k a � 2 « K � k Attachment 3 Santa Ana Workforce Development Board AJCC Comprehensive Infrastructure Budget, and Other System Cost Budget Total Casts SFR 2.27% Cost Category/Line Item Cost Details Costs Total Monthly Property Rent One Cubicle for3 months} Monthly Cost Monthly Property Rent Cubicles Total Monthly Rent and Equipment Cost Rent Base Rent Incl. Janitorial, Maint and Utilities $42,506.20 $481.87 $963.75 $963.75 Operational Cost 2%of Rent Management Fee 1.76%of Rent Total Rent .75 .75 Utilities/Maint Telephone Services Per Person Monthly costs of Dial Tone and Voice Mail Assigned $1,955.00 MI$44.90 $85.00 $0.00 $85.00 Shared Phones b usage ersentage $212.50 $4.82 $0.00 $4.82 Security Guard (Annual) Includes$840 Parking $1,137.22$94.77 $94.77 Total Utilities/Maintenance $184.59 $0.00 $184.59 *Equipment New Phone System Phones by assigned phones $9,536.29 $3.71 $7.43 $0.00 $7.43 Shared Basic Phones $687.86 $0.12 $0.25 $0.00 $0.00 Licenses assigned phones $4,680.48 $1.86 $3.71 $0.00 $3.71 Licenses $557.20 $0.11 $0.21 $0.00 $0.21 Switches $5,035.07 $1.61 $1.90 $0.001 $1.90 New Phone System Annual Support Cost 982. 7 0.92 1.86 0.00 . 66 Total Equipment $21,478.97 $7.731 $15.36 $0.00 $15.36 **Technology and Access Costs Network Wireless Bride Network $14,080.23 $2.62 $5.32 $0.00 $5.32 Access System/Card Key Cud System $17,194.28 $3.24 $6.50 $0.00 $6.50 Data & Phone Cabling Cabling $58,097.10 $10.94 $21.95 $0.00 $21.95 Information Technology Cost Per Month Wireless Network Bridge Maintenance $7,425.00 $1.40 $2.81 $0.00 $2.81 ""Printers Annual Resource Room use y clients only $6,523.20 $1.23 $2.47 $0.00 $2.47 opy room printer for staff only $4,194.60 $0.79 $1.59 $0.00 $1.59 Total Technology and Access $107,514.41 $0.00 $20.22 $40.63 $0.00 $40.63 In -Kind Infrastructure Total 1$130,948.38 $42,506.20 $554.721 $240.581 $963.75 $1,204.33 Equipment is a 3 year amortuatton expensea monthly. Equipment is charged at actual cost for assigned phwtes m partners. 5 basic phones are shared phones and charged by percentage "Technology and Access Costs are all based on percentage and amortized over 5 years *' Technology and Access Costs are all based on percentage andAmor ized over 5 years t (9-months, 2-cubicles at $8,673.72; 3-months, 3-cubicles at $4,336.96; Total $13,010.58) Attachment 3-1 Sharma Uther Une-Stoo Delivery Svstem Costs m The budget must include "applicable career services" as well as any other shared costs agreed upon by the AJCC partners. While only co -located partners share infrastructure costs, all One -Stop partners must share in other system costs, including applicable career services. Required Consolidated System Budget for "Applicable Career Services" Summary of Career Services Applicable to Each AJCC Partner The MOU requires identification of the career services that are applicable to each partner program (Attachment 2). Accordingly, this budget includes each of the partner's costs for the service delivery of each applicable career service. Unlike infrastructure cost sharing, other system costs, including "Applicable Career Services" are not limited to the non -personnel costs and should include all costs related to the administration and delivery of those services. AJCC Applicable Career Services SER Career Services: $4120,67 • Eligibility Determination (1) • Outreach, Intake and Orientation (2) • Initial Assessment (3) • Job Search, Placement Assistance, and Career Counseling (4) • Employment statistics -Labor Market Information (5) • Eligible Provider performance and program Cost Information (6) • Local Performance Information (7) • Supportive Services' Information (8) • Unemployment Compensation(9) • Eligibility Assistance(I0) • Follow -Up Services(11) • Comprehensive and Specialized Assessments(12) • Individual Employment Plan Development (13) • Group Counseling (14) • Individual Counseling and Career Planning (15) • Case Management (16) • Short -Term Prevocational Services (17) Training $4120.67 • Occupational Skills Training (1) • On -the -Job Training (OJT) (2) • Workplace and cooperative education (3) • Training programs operated by the private sector (4) • Skills upgrading and retraining (5) • Entrepreneurial training (6) • Job -readiness training (7) • Adult Education and Literacy programs (8) • Customized training (9) Employer Services $0 Attachment 3-1 APPLICABLE CAREER SERVICES • Employer needs assessment (1) • Job posting (2) • Applicant pre-screening (3) • Recruitment assistance (4) • Training assistance (5) • Labor Market Information (6) • Employer information and referral (7) • Rapid Response and Layoff Aversion (8) Total Career Service Cost 1 $8,241.34 0 o m a o a o `d a N a o o M Ln c w ni n ai o o 'i ri o d e m o a o m a N a O a N fl N N �O U > N N Vl N N N N a+ V N 0 `- Y E O a N N i-+ m a rn m m m o c M o n o o n Lq • L L £ c N N N _n w N N N N vY N N ro m a ti m e rii Lq s m e oN oN a m L E U n c0 W M N r E � W C +J O O N N N N N N N C O O c A G /}� •y nv O � OL V N o] VI M h N o M L O C O N N L1 N N N N H B O vl nMi e^i ti N p M U N a o m o m O N t0 •� a N O E J y W T N e'yl N C H W iL m c E G q a V C j O U E m a n m o C Y C T J a u Y r a y a) m c a m n W N O N Vmi VI F T S-�7 OFFICE LEASE A-2017-264 Attachment 5 THIS OFFICE LEASE ("Lease") is rondo and entered into by and between CP SANTANA, LLC, a Delaware limited liability company ("Landlord") and the Tenant described in lIqUI of the Basic Lease Provisions as of the EI'1'ective Data. BASIC LEASE PROVISIONS L Tenant; THE CITY Op SANTA ANA, a charter city and municipal corporation. 2. Description of Project; Building; Premises: 2A Project: As used herein, the "Projeef' means that certain commmmial office building project, with all common areas and appurtenant parking facilities, loomed at 801 West Civic Drive, Santa Ana, Calilbr» ia, and containing the Building, and any other building improvements located on the parcel orreal property on which the Building is located. 2.2 Building; As used herein, the "Building" means the commercial office building located at and commonly known as 801 West Civic Drive, Santa Ana, California. 2.3 Rentable Area of Building: 124,166 rentable square feet (" RSF") 2.4 Premises: A portion of the second (2"1) Boor of the Building known as Suite 700, as depicted on Exhibit "A" attached hereto. 2.5 Rentable Arent of Premises: 19,321 RSF, 3. Term: 3.1 Target Delivery Date: April 1, 2018. 3.2 Commencement Date; The Delivery Data. 3.3 Initial Term: ApprMdMIdely sixty (60) months, commending on the Commencement Date and ending on the last day of the calendar month in which the date that is sixty (60) months after the Commencement Date occurs, 3.4 Options to extend the Term: Two (2) options to extend the Term for an Extension Term of sixty (60) months, in accordance with Sgioq,3, below and Schedule"J-I"ofE "" attached hereto, 4. Bose Rent: During the Initial Term, Base Rent shall be payable at the fallowing rates; Months Monthly Base Rental Rate Base Rent ($lRSFlmo) (stmo) 1-12 $2.2000 $42,50620 13-24 $2,2660 $43,781.39 25•-36 $2,3340 $45,094.83 37•-48 $2,4040 $46,447.67 49.60 $2.4761 $47,841.10 5. Additional Beal•. 5.1 Tenant's Percentage Share: 15.561% 5.2 Basc'1'car: 2018 6. Security Deposit: None 7. Permitted Use: General office use and other hiwild incidental uses, consistent with a lost class- high-rise Commercial nliico project. 8. Parking Number- The whole number closest to the product of (a) the number of RSF contained in the Premises and (b) 0,004 (such that it is agreed that die Parking Number with respect to the initial Premises is eighty-trau (82)). 9. Brokers: Lee & Associates Realty Group Newport Beach, Inc., representing- Tenant, and .luncs Lang LaSalle Brokerage, representing Landlord. 10, Address 1'nr Payments: All payments payable to Landlord under this Lasso shall be sent to the Iidlowing address or to such other M1 PPCh')c ('laA'Y t)r-Ci0•ofSnnhr Auo Leave -o- 11. Address for Notices: 11.1 To Tenant: 11.2 To Landlord: address as Landlord may designate, or by wire transfer. Irby check: Irby wire transfer; CF Santana LLC C/o Ocean West Management Services 33351 Collection Center Drive Chicago, IL 60693-0333 Reference: City ol'Santa Ana/Suite 200 Prior to the Commencement Date: City of Santa Ana Clerk of the Council 20 Civic Center Plaza, M-30 Santa Ana, CA 92702 Alm [[ I After the Commencement Dale: At die Premises: Attn: Deborah Sanchez CF Santana LLC C/o OW Management Services, Inc. 315 W. 9" Street, suite 808 Los Angeles, California 90015 Attn: Ted Bischak. Bank Name: Bank of America N. A. BankAddress: 100 W. 33rd Street New York, NY 100 Account Name: CFSantana LLC Aca#: 4451112624 ABAk: 1110000 12 Reference: City of Santa Ana/Suite 200 With a coov to: City of Santa Ana Clerk of the Council 20 Civic Center Plaza, M-30 Santa Ana, CA 92702 Attn: [[ 1] With a copy to: City Atlomey's Office— City of Santa Ana 20 Civic Center Plaza, M-29 Santa Ana, CA 92702 With a copy to; Zubar Lawler & Del Duca LLP 777 South Figueroa, 37tb Floor Los Angeles, CA 90017 Attn: David B. Lambert, Esq. This Lease shall consist of die foregoing "Basic Lease Provisions", consisting of Ltgmg I through L I above, the "Standard Lease Provisions", consisting oC Articles I through 17 which billow, and Exhibits "A" through "M", inclusive, all of which are incorporated herein by this reference, ht tileen event of any conflict betweany of the Basic Lease Provisions and any of the: Standard Lease Provisions, the Standard Lease Provisions shall control. Any initially capitalized terms used herein and not othervvise defined shall have the meanings set forth in the Standard Lease Provisions. 801 W CAr Center Dr—Cid, a%Saata.dna Lease STANDARD LEASE PROVISIONS ARTICLE I —DEFINITIONS 1.1 "Additional Bent" means all nnnounts other than Base Rent that are payable by Tenant to Landlord pursuant to this Lease, whether or not denominated as such. 1.2 "Affiliate" means, with respect to any designated Person, any Person that is directly or indirectly Controlled by, under common Control with or that Controls such designated Person. 1.3 "Alterations" nsatuis any alterations, additions, improvements, removals or replacements to the Premises (including, without limitation, the Tenant Improvements, if any) or any other portion of the Building or Project. 1.4 "Approved Governmental Entities" means all ofthe State and County agencies listed in Exhibit "M" attached herein, 1.5 "Base Rent" means rental amounts that are payable by Tenant to Landlord pursuant to Section 4.1.1 below. 1.6 "Building Systems" means the primary utility and mechanical systems, including, without limitation, the primary life safety, electrical, heating, ventilation and air conditioning ("HVAC"), plumbing or sprinkler systems for the Building and/or the Project (and for the avoidance of doubt, it is understood and agreed that the Building Systems do not: (1) include any portions of any such systems and equipment that are installed within or that exclusively serves any particular rentable space in the Building or Project (such as, without limitation, any extension or distribution of services or utilities from the Building Systems serving such space) or (b) any: (1) supplemental or specialty electrical, mechanical, plumbing, heeling, ventilation or air conditioning systems, fixtures or equipment; (ii) supplemental or specialty fire, life, safety or security systems, fixture or equipnnen , (ifi) any video, audio, communications or computer systems, fixtures or equipment (Including cabling)), 1.7 "Casualty" isdefined in Section 13.1,1. 1.8 "Casualty Damage" is defined in Section 1.9 "Claims" means, collectively, claims, losses, dmnages, obligations, liabilities, costs and expenses, including, but not limited to, reasonable attorneys' tees and legal costs. 1,10 "Common Areas" Ricans the lobby, plaza and sidewalk areas, accessways, Parking Facilities, and die area on individual floors in the Building devoted to corridors, lire vestibules, elevators, foyers, lobbies, electric and telephone closets, ree[mema, mechanical rooms, janitor's closets, and other similar facilities for the benefit orall tenants and invitees and shall also mean those areas of the Building devoted to mechanical and service rooms servicing the Building. 1.11 "Comparable Buildings" means comparable Class "A" office buildings in the Market at [lie time die Extension Tenn commences. 1.12 "Control" or "Controlling" means possession of the direct or indirect power to direct or cause the direction of the management and policies of's Person, or Ownership of any sent, 1.13 "Damage Notice" is defined in Section 13.1.1, 1.14 "Default Rate" means all annual rate of interest equal to lesser of: (a) eighteen percent (IS%) per annum or (b) the maximum con met amount allowed by Law, 1.15 "Delivery Condition" means (and the Premises shall be in Delivery Condition) upon Substantial Completion of the Premises. 1.16 "Delivery Dale" means the date on which Landlord tenders to ']'client delivery of possession of the Premises in die Delivery Condition; provided that if the dale on which the Premises ere in Delivery Condition is delayed as result of any Tenant Delays, then for purposes of determining the Conuvencenicut Date, the Delivery Date shell be deemed to occur on the dale that the Premises would have been in Delivery Condition had such Tenant Delays not occurred, as reasonably determined by Landlord, below. 1.17 "Effective Date` meansthe date upon which this Lenses executed by Landlord, as indicated beneath L,andlord's signature block 1,18 "Encu nib"' Ices" means liens, claims, stop notices and violation notices. 1,19 "Environmental Laws" means and includes all now and hereafter existing statutes, Iowa, ordinances. codes, regulations, rules, rulings, ordeis, decrees, direetlVCS, policies and requirements by any federal, state Or local governmcnml authority regulating, relating to, or imposing liability at, standards of conduct concerning public health and safety or the environment. 1.20 "Event ol'DefiloIC N defined in Section 15.1 below. 1.21 "Executive Order 13224" means Executive Order 13224 signed on September 24, 2001 and entitled "Blocking Property 'Lind Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or 5uppoit'ferrorism", 1.22 "Expiration DAW" 111v'aa$, at any partiUllar time, the date on which dle'Term is scheduled to expire. 801 IV Civlr Canter Ur—Cin, n(5'nNo Ana Leave -I- 1.23 "Holder" means the holder of any Security instrument. 1,24 "Expressly Restricted Use" means any use for: (a) offices of ally division, agency or bureau of any foreign government or subdivision thereof, (b) offices of any health care professionals or for the provision of any health care services, (c) any schools, (d) any retail or restaurant uses, (a) any residential use, (1) any communications uses such as broadcasting radio and/or television stations, (g) "executive suite" type uses where office suites are maintained for individual rental, or (h) any occupancy density greater than the average occupancy density for office tenants orthe Project. - 1.25 The "FMRR" of the Premises for a particular Extension Tenn (as defined in Schedule "J-V) or for a particular Leased First Right Space (as defined in Schedule "J•2' for the term of Tenant's lease thereof, shall be equal to the rent per square foot of Rentable Area that Landlord has agreed to accept, or if Landlord determines that these has not been a reasonable number of current comparable transactions in the Project, that landlords of the Comparable Buildings have agreed to accept, and sophisticated nonaffiliated tenants of the Project and/or Comparable Buildings have agreed to pay, in current aims -length, non equity (i.e„ not being offered equity in the building), transactions for comparable space (in terms of condition, floor location, view and floor height) of a comparable size (in terms of square feet of Rentable Area), for a term equal to the Extension Terns (or the terns or Tenant's lease of the applicable Leased First Right Space) and with a commencement dale within six (6) months before or after the first day of the Extension Term (or the applicable Offered Space Scheduled Commencement Data (as defined in Schedule "J-2' ), which rent per square root shall take into account and make adjustment for the existence, timing and amount of any increases in rent following term commencement in the comparison transactions, and shall at all times take into consideration and make adjustment for all other material differences in all terms, conditions or factors (applicable to the transaction in question hereunder or applicable to one or more of the comparison transactions used to determine the FMRR) that a sophisticated tenant or sophisticated landlord would believe would have a material impact on a "fair market rental" determination; provided, however, that: (a) the rent for all comparison transactions shall be adjusted to reflect payment of operni ng expenses and real estate taxes in the same manner as the same are payable hereunder (e.g., if this is a modified, full service gross lease, the rent for all comparison transactions shall, if applicable, be grossed up to reflect payment of operating expenses and taxes in excess of a base year as of the year of commencement of the transaction), (b) the presence, amount or absence of brokerage commissions in either the subject transaction or the comparison transactions shall be disregarded, (c) any rent abatement or other free rent of any type provided in comparison transactions for the period of the performance orally tenant improvement work (i.e., any "construction period") shall be disregarded, and (d) if any tenant improvements or allowance provided for in comparable transactions shall be taken into account, then the value of any existing improvements fa the Premises (or the Leased First Right Space) shall also be accounted for in the calculation of the FMRR (provided that if in determining the FMRR for a subject transaction hereunder, it is determined that tbee rent or cash allowances (collectively, "Concessions") should be granted, Landlord may, at Landlord's sole option, elect all or any portion of the following: (i) to grant some or all of the Concessions to Tenant as free rent or as an improvement allowance, or (ii) to adjust the monthly installments of the Base Rent payable for tie Extension Tern or with respect to the Leased First Right Space, as the case may be, to be an effective rental rate which takes into consideration and deducts from monthly rent the amortized amount of the total dollar value of such Concessions, amortized on a straight line basis over the Extension Term or the term of Tenant's lease of the Leased First Right Space, as applicable in which case die Concessions so amortized shall not be provided to Tenant). 1.26 "Force Majeure Events" means events described in Section 17.5 below. 1.27 "klandle", "trundled", or "Handling" meoos, with respect to Hazardous Materials, any installation, handling, generation, storage, treatment, use, disposal, discharge, release, mnnufacture, refinement, presence, migration, emission, abatement, removal, transportation, or any other activity of any type iu connection with or involving such Hazardous Materials. 1.28 "Hazardous Materials" means: (a) any material or substance: (i) that is defined or that becomes defined as a "hazardous substance', "hazardous waste," "infectious waste," "chemical mixture or substance," or "air pollutant" under Environmental Laws; (if) that contains petroleum, crude oil or any fraction thereof; (III) that contains polychlotinated biphenyls (PCB's); (iv) that constitutes asbestos or asbestos -containing material: (v) that is radioactive; or (vi) that is infectious; or (b) any other material or substance displaying toxic, reactive, ignitable or corrosive characteristics, as all such terms are used in [heir broadest sense. 1.29 "Ilaldover Rental Rate" means an amount equal to one hundred fifty percent (150%) or the greater of: (a) Landlord's then published asking rental rate or (b) the Base Rent and Additional Rent payable by Tenant to Landlord during the last month of the Term of this Lease. 1.30 "Initial Premises" means the premises described in Item 2.3 of the Basic Lease Provisions. 1.31 "Initial Term" means the period (which shall commence rah the Commencement Date) that is described in Item 3.3 ofthe Basic Lease Provisions; provided that if the Commencement Date shall occur on a day other than the first day of Lilly calendar month, for purposes of calculating the dale on which the Initial 'Penn is scheduled to expire (i.e„ the Expiration Date for the Initial Term) and the timing craft scheduled increases in Base Rent during the Initial Term (but not for any other purpose), the Commencement Date shall be deemed to be the first day of the calendar month following the Commencement Date. 1.32 "Institlrtional Owner Practices" means the practices of the majority or the institutional owners of institutional grade first-class ofiiec projects in Orange County, Cali fornin. 1.33 `interest Rate" means an annual rate of interest equal to the Reference Rate plus two percent (20/4), 1.34 "Landlord Default" is defined in Section 16.1 below, 1.35 -Landlord Parties" means, collectively, Landlord, Ocean West Capital Pnrners, I.I.C. Fortress Investment Group, LLC, slid the Property Manoger, and each of their Affiliates and Of of their respective partners. member, officers, managers. directors, trustees, employees, retirees, beneficiaries, counactors (including internal invcstmeut contractors), agents, advisors. motgugecs and ground lessors, agents, successors and assigns, �Y01 IV'Chk Center Dr -City ofSoala; inn Leone -2- 1.36 "Landlord's Additional Insureds" menu, collectively, Landlord, Ocean West Capital Partners, LLC, Fortress Investment Group, LLC, end the Properly Manager, and each of their respective ngents, beneficiaries, pm4ners, employees, and any Holder (defined below) of any Security Instrument (defined below) designated by Landlord as additional insureds. 1.37 "Landlord's Lease Undcrtakipgs" means each and all of the representations, warranties, covenants, undertakings, and agreements contained in the Lease Documents that is or are to be provided or perfonned by Landlord. 1.38 "Laws" means, collectively, all laws, ordinances, building codes, rules, regulations, orders and directives of any governmental authority havingjurisdiction (including, without limitation, any certificate ofoccupancy), 1.39 "Lease Documents" means this Lease together with all exhibits, riders or addenda attached hereto, and all amendments thereto. 1.40 "Leasehold Improvements" means all leasehold improvements existing in the Premises as of the Effective Date, the Tenant Improvements, and any additional Alterations. 1.41 "Market" means the Santa Ana Civic Center submarket. 1.42 "Money Laundering Act" means the International Money Laundering Abatement and Financial Anti -Terrorism Act of 2001 or the regulations or orders promuignted thereunder, as the same may be amended from time to time. 1.43 °Notified Party" means each Holder of which Tenant has received notice, 1.44 "OFAC" means the Office of Foreign Asset Control of the Department of the Treasury. 1.45 "Original Tenant" means the Person Identified as the "Tenant" in Item I of the Basic Lease Information. 1.46 "Parking Facilities" means die Project's parking facilities from time to time serving the Building. 1.47 "Parking Fees" is defined in Section 4.3 below. 1.48 "Parking Passes" means, collectively, Unreserved Parking Passes and Reserved Parking Passes. 1.49 "Permitted Alterations" means only usual and customary maintenance and repairs of Leasehold Improvements If and to the extent that such maintenance and repairs: (a) are of a type and extent which are customarily permitted to be made without consent by landlords acting consistently with Institutional Owner Practices leasing similar since for similar uses to similar tenants, (b) are In compliance with the Rules and Regulations, and (e) will not affect the Building's structure, the provision of services to other Project tenants, or any Building Systems. 1.50 "Person" means an individual, general or limited partnership, limited liability partnership or company, corporation, b-ast, estate, real estate investment test association or any other entity. 1.51 "Premises" means die Initial Premises as it may be expanded or reduced pursuant to any provision of this Lease or upon the agreement of Landlord and Tenant. 1,52 "Premises Restoration" means the Restoration of the Premises and the portions of (lie Common Areas that are required for access to the Premises. 1,53 `Property Manage" means OW Management Services, Inc., or shy other Payson retained by Landlord to manage and operate the Building on a day to day basis. 1.54 "Proposed Transfer Spac' means, with respect to any proposed Transfer, the portion of the Premises subject to such proposed Transfer. 1,55 "Reference Rate" means the "prime rare" or "reference rate" announced tiom time ni time by Bank of America, N.T. & S.A. (or such reasonable comparable national banking institution as is selected by Landlord in the event Banc of America, N.T. & S.A. ceases to publish u prime rate or inference rate). 1.56 "Rent" is defined in S, ooimn 4 d 1 below. 1.57 "Rent Delinquency" means and shall occur upon any railure of Landlord to receive any payment of Rent on or before the date that is Five (5) days after the date such payment of ltent is clue. 1.58 "Reserved Parking Passes" mess• parking privileges to be used Air parking on a first come first served basis in "reserved parking m'eas" in the Parking Facilities, as designated by Landlord, or at the election of Landlord, in reserved parking spaces located in die Parking Facilities. 159 "Restoration" is defined in Section 13, 1.1. 1.60 "Review Expenses" mess all review and processing fees, and costs, as well as any reasonable professional, uttorneys', accountants', engineers' or other consullunts' fees incurred by Landlord relating to any request by Tenant liw Landlord's consent, including, but not limited to, Day request for consent to a proposed Transfer, 801 W'CMr Cener Dr—C16, nj9ennn fl roe Leave -3- 1.61 'Rules and Regulations" means the rules and regulations attached hereto as Exhibit •'D" (which are hereby incorpornted herein and made a part hereol) and any reasonable and non-discriminatory amendments, modifications and/or additions thereto as may hereafter be adopted end published by written notice to tenants by Landlord for the safety, care, security, good order and/or cleanliness ofthe Premises and/or the Project. 1.62 "Security Deposit" means a cash security deposit in the amount specified In Item 6 of the Basic Lease Provisions. 1.63 "Security Instruments", means, collectively: (a) all present and future ground leases and master leases of all or any part of the Project, Building or Premises; (b) present and future mortgages and deeds of trust encumbering all or any part of ilia Project, Building or Premises; (c) all post and future advances made under any such mortgages or deeds of trust; and (d) all renewals, modifications, replacements and extensions of any such ground leases, master leases, mortgages and deeds of trust, which now or hereafter constitute a lien upon or affect the Project, Building or Premises. 1.64 '`Substantial Completion" (and "Substantially Complete") Is defined In the Work Letter. 1.65 "Taking" is defined in Section 13.2. 1.66 "Taking Date" is defined in Bection 13.2. 1.67 "Target Delivery Date" means the date specified in Item 3.1 of the Basic Lease Provisions, 1.68 "Tenant" means the Original Tenant, and any person or entity to whom or to which all of Original Tenant's (or any other Tenant's) interest in this Lease is assigned (or otherwise transferred) in accordance with the provisions ofArticle I of this Lease. 1.69 'Tenant Delays" Is defined in the Work Letter. 1.70 "renant Improvements" means the initial Alterations (if any) to be constructed and/or installed in the Premises pursuant to the Work Letter (if any). 1.71 '"tenant Parties,, means collectively, Tenant, its subtenants, assignees or other Transferees, and their respective contractors, clients, ofdeers, directors, employees, agents, and invitees (such of which shell be a "Tenant Party"). 1,72 'Tenant's Hazardous Materials" means any Hazardous Materials that become present in, on, under or about the Project as a result of any act or omission of Tenant or any otter Tenant Party. 1.73 "Tenant's Personal Property" means all of Tenant's (and the other Tenant Parties') office furniture, business and personal trade fixtures, machinery and equipment, &milure and furniture systems, movable partitions, teleconwnnications equipment, data cabling and other items of personal property, 1.74 'Term" means and shall refer to the Initial Term as it may be extended pursuant to Schedule "J-I"of Exhibit "J". attached hereto and/or pursuant to the written agreement of Landlord and Tenant. 1.75 "Transfer" means and includes any of the following: (a) a sublease all or any part of [he Premises, (b) an assignment of the Lease, (c) any other agreement or arrangement• (i) that permits a third party (other than Tenant's employees and occasional guests) to occupy or use any portion of the Premises or Ill) otherwise assigns, transfers, mortgages, pledges, hypothecates, encumbers or permits a lien to attach to Tenant's interest under this Lease or (d) a direct or Indirect trransfer, assignment, pledge, or hypothecation of a Controlling interest in Tenant. 1.76 "Transfer Notice" means a Witten notice that: (a) identifies a proposed Transferee by its name and address; (b) describes the applicable Proposed Transfer Space; (c) includes current financial statements of the proposed Transferee certified by an officer, partner orowner thereof,, (d) describes fine nature of such Transferec's business and proposed use of the Proposed Transibr Space; (e) doe proposed effective date of the proposed Transfer, and (f) all of the principal terns of the proposed Transfer, 1.77 "Transfer Profits" means, with respect to any particular month and any particular Transfer, an amount equal to: (a) all rent, addidonal rent or other consideration payable by or on behalf of such Transferee during or with respect to such month in connection with the Tralluer minus (b) the sum o11 (1) the Base Rent and Additional Rent payable by Tenant under Sections 4 2 and 43 of this Leasc daring or with respect to the same month and (!i) all out orpocket costs reasonably incurred by Tenant fit connection with such Transfer (such as brokerage commissions and/or improvement allowances), amortized on a straight line basis over the tern of such Transfer. 1.78 °Trunsforee" means any Person to wheat a Transfer is made. 1.79 "Unreserved Parking Passes' means parking privileges to be used for parking on a first come first served basis in the areas of the parking Facilities designated by Landlord therefor. 1,80 'Work Letter" means the Tenant Work Letter (if any) attached hereto as Exhibit "C", 'terms in initial capitals Ihnt are not defined in Article I shall have the meanings given to them elsewhere in this Lease, ARTICLE 2— LEASE OF PREMISES• COMNION AREAS: P ARI'INC• SIGNS 2.1 Lease of Premises; Access; Quiet Enioyment. 80 Ir Clrie Center Dr— CIO, ofsnnnt"Our Leave .4- 2.1.1 Landlord hereby leases the Premises to Tenant, and T'ensnt hereby leases the Premises from Landlord, upon all of the terms, covenants and conditions contained in this Lease. Tenant acknowledges that Landlord has not made any representation or warranty with respect to the condition of the Premises, the Building or the Project with respect to the suitability or fitness of any of the same for the conduct of Temtnl's Permitted Use, its business or for any other purpose. Landlord does not represent and Tenant does not rely upon any specific type or number of tenants occupying any space in the Building and/or the Project during the Tenn orthis Lease. Acceptance ofpossession of the Premises by Tenant shall be conclusive evidence as against Tenant that the Premises are then in tenantable and good wndilion. 2.1.2 Landlord and Tenant hereby agree that the number of RSP (also referred to as the "Rentable Area") contained: (a) within the Building is as set forth in Item 2.5 of the Basic Lease Provisions and (b) within the Premises is as set forth in 1 em 2.5 of the Basic Lease Provisions. 2.1.3 Subject to Landlord's access control programs and the Rules and Regulations, Tenant and its employees and invitees shall be entitled to access the Premises seven (7) days per week, twenty-four (24) hours per day. 2.1.4 Subject to all of the terms and conditions contained in this Lease and provided that Tenant performs all of its obligations hereunder, Tenant shall have and peaceably egjoy the Premises during the Term of this tease from and against all Persons holding an Interest in the Project front and through Landlord, 2.2 No Relocation of Premises: Right ofPirst Offer. 2.2.1 No Relocation. Landlord shall have no right to relocate any portion of the Premises located on the second (2ad) floor of the Building. Any relocation rights with respect to any portions of the Premises located oft any other floor of the Building will be specifically negotiated In connection with Tenaol's lease of any such space. 2.2.2 Right of First Offer. Tenant shall have a one-time Right ot'First Offer (defined below) with respect to the First Right Space (defined below) subject to and In accordance with the terms and conditions of Schedule 1-2" of Exhibit"I", attached hereto. 2.3 Common Arcas: Parking. 2.3•I Common Areas, In connection with its lease of die Premises, Tenant shall have the non-exclusive right to use the Common Areas to gather with other Persons. The Common Areas shall be subject to the exclusive management anti oc nunl of Landlord, end Tenant shall comply with all Rules and Regulations pertaining to use of the Common Areas, Landlord shall have the right from time to lhme to designate, relocate and limit the use of particular areas or portions of the Common Areas, Landlord shall also have the right to close all or any portion orthe Common Areas as may, in the sole discretion of Landlord, be necessary to prevent a dedication thereof or the necrual array rights in any Person. 2.3.2 Rental ')lid Use of Parking Passes: Visitor Parldna. (a) Commencing on the Commencement Dale and continuing through the Term, Tenant shall rent from Landlord and Landlord shall provide a number of Unreserved Parking Passes equal In the Puking Number specified in Item 8 of the Basic Lease Provisions. Parking Fees shall be payable with respect to Parking Passes rented by Tenant at the rates provided in Section 4 3 1 below (which shall be subject to abatement in accordance with Section 4 3 2 below), The Parking Passes are with respect to, subject to the provisions of this Lease, use of the Parking Facilities. The Parking Passes provided to Tenant pursuant to this Section 2.3.2 are provided to Tenant solely for use by officers, directors, and employees of Tenant, its Affiliates, sublessees and assignees, and such passes may not otherwise be transferred, assigned, subleased or otherwise alienated by Tenant to any other type of t ansforee without Landlord's prior approval. (b) The specific locations within the Parking Facilities in which the Unreserved Panting Passes may be used shall be specified by and may, from time to time, be relocated by Landlord in Its sole discretion. In addition, it is expressly understood and agreed that Landlord shall have tie right to implement, administer slid enforce a parking management program, with respect to die Parking Facilities generally, with respect to use crone or more types or Parking Passes in particular, and/or with respect to the use of the Panting Passes rented by one or more specific tenant or tenants (including Tenant), with parking management plan may include, without limitation, any or more of the following measure or features: oversell of Parking Passes; expansion of the Parking Facilities to include additional parking lots or structures within a reasonable distance from the Building; reservation of specific portions of the Parking Facilities for parking by one or more specilic Building tenants (including Tenant) and/or for one or more Building tenants' business visitors; impleimcntation orvalet or assisted parking programs or measures; creation and allocation of tandem parking spaces to specific Building tenants; designation of visitor parking rates: and allocation of validation privileges to one or nio•e Building tenants. It is specifically understood and agreed that it Landlord implements one or more such measures or features tiro are: (i) generally applicable to the Parking Facilities, the costs incurred to implement, administer and enforce such measures shall be included in Operating Costs or (it) that are specific to Tenant, the costs incurred to implement, administer and enforcesuch measures shall be reimbursed by Tenant, (a) Visitor Parldre. (i) Tenant's business visitors may park in the Parking Facilities, or in die applicable portions thereof designated by Landlord, on a first conic, first sewed basis, upon payment ofthe prevailing fee for parking charged to visitors to the Project. Tenant shall have the right to purchase from Landlord, at Landlord's then prevailing rate, Project Parking Validations (defined below), to be used silly by Tenant's Business Customers (defined below) for parking in the Parking Facilities without charge. -Project Parking Validations" means validations. in such form as Imadlord, in its sole but good faith discretion. shall offer from time to time. permitting persons using such validations to park in the Parking Facilities for spccilied periods Or time without charge (i.c., a 30-mimite validation would pe nit parking without charge in the Parking Facilities for a period up to 30 minutes). "Tenant's Business Customers" means Persons than visit the Premises fro• the specilic purpose of conducting business at the Premises (rand for the avoidance nrtloubt, shall not include any employees of -Penman or any or hs, Tansfe•ees who have uBicos (nil an exclusive or shared basis) at the Premises). 801 F6'1711-1c Crnrer Dr-Chr ofSnua:bra Lease -5- (ii) Notwithstanding the foregoing, each calendar month during the Term, Landlord shall provide to Tenant, without charge: (A) a number ol'Short Term Project Parking Validations (defined below) equal to the product of twenty (20) and the number of days in such calendar month (during the Term) and (B) a number or Long Term Project Parking Validations (defined below) equal to the product of sixty (60) and the number of days in such calendar month (during the Term), in each case to be used only by Tenant's Business Customers for parking in the Parking Facilities without charge; provided that Landlord shall have the right to reasonably adjust the number of Shot Term Project Parking Validations and Lou Term Project Parking Validations so provided by Landlord (based on actual usage) effective as of expiration of file third (P) full calendar month of the Initial 'fern, and ill ereafler, upon expiration of eseh subsequent three (3) calendar month period; provided further that: (x) Landlord shall not, at any time during the Term, be required under this Section 2.3.2(c)(ii) to provide a number of Project Parking Validations in any calendar month in excess of a number equal to the product oreighty, (80) and the number of days in such calendar truth (during the Term) and (y) any Project ParkingValidations provided by Landlord with respect to any particular calendar month that are not used during such calendar month shall, at the election of Landlord, either: (1) become null and void (and be returned to Landlord) or (2) be credited against Landlord's obligations to provide Project Parking Validations under this Section 2.3.2(c)(ii) for subsequent calendar months, No Project Parking Validations provided by Landlord to Tenant under this Section 2.3,2(c)(ii) shall be used to accommodate parking, without charge, by any particular Tenant's Business Cuslomer(s), for a period in excess of three (3) hours on any day without Landlord's prior approval (and Tenant shall not provide any pnrticular Tenant's Business Customer more than one Project Parking Validation on any particular day). "Short Term Project Parking Validations" means Project Parking Validations permitting Persons using such Project Parking Validations to park in the Parking Facilities for up to thirty (30) minutes without charge. "Long Term Project Parking Validations" means Project Parking Validations permitting Persons using such Project Parking Validations to park in the Parking Facilities for up to three (3) hours without charge. 2.4 &M. 2.4.1 Except to the extent expressly provided in this Section 2.4 Tenant shall not: (a) place or install (or allow or permit to be placed or installed by any Tenant Party) any signs, advertisements, logos, identifying materials, pictures or names of any type on the roof, exterior areas or Common Areas of the Building or the Project or in any area of Tile Building, Premises or Project which is visible Gam the exterior of the Building or outside of the Premises or (b) place or install (or allow or permit to be placed or installed by any Tenant Party) in or about any portion or the Premises any window covering (even if behind Building standard window coverings) or any otter mnterial visible from outside of the Premises o- from tlhe exterior of the Building, Tenant shall not, widhoul the prior written consent of Landlord, use the name of the Building and/or the Project, or any pictures or illustrations of the Building and/or the Project, in Tenant's advertising or in any other publicity. 2.4.2 Subject to compliance with applicable Laws and such Building signage criteria as Landlord shall apply from time to time, and subject to receipt of Landlord's prior written consent: (a) in the case where Tenant occupies an entire floor in die Building, Tenant may place in any portion of such floor which is not visible from the exterior of the Building such identification signage as Tenant shall desire and (b) in the case where Tenant occupies less than an entire floor in the Building, Tenant may require Landlord to install, at Landlord's sole cost and expense, in such portion of the multi -tenant corridor on such floor ns is called for by Landlord's signage program (as the same rally exist from Lillie to time) identification signage of the type prescribed by Landlord's signage program identifying Tenant; (c) Landlord shall provide customary signage in tie Building directory (if any) in the ground floor lobby of the Building (Landlord shall bear the initial cost of such directory signage and the cost of updated any such directory signage no more than one in any month); and (d) Tenant may place in any portion of the inside of the Premises not visible from (he exterior of the Building or from outside of the Premises such identification signage as Tenant shall desire. All signage described in this Section 2 .4.2 (other than the directory signage described In clause (c) above) shell be treated as Tenant's personal property under the provisions of Section 10.5 with respect to'renunt's obligation of the expiration or early termination of this Lease. 2.4.3 Eyebrow Sign. [a connection with Temmt's lease of the Premises, subject to all of the terms and conditions of Exhibit ".K" attached hereto, during the Term, Tenant shall have the right to install and display at the Project the Eyebrow Sign (defined in Exhibit "'K", attached hereto) in the location described in Exhibit "K", attached hereto. ARTICLE. 3—DELIVERY• CON-IMENCEN1 ENT: TERN% SURRENDER: HOLDING OVER 3.1 Delivery, Landlord shall endeavor to tender to Tenant delivery or possession of the Premises in the Delivery Condition prior to the Target Delivery Dale; provided, that if the Delivery Date does not occur on or before the Target Delivery Date, this Lease shall not be void or voidable, the 'Perm of this Lease shall not be extended, and Landlord shall not be liable to Tenant lot' any loss or damage resulting therefrom; provided further that Landlord shall use Commercially reasonntic efforts to tender to Tenant delivery of possession of the Premises in the Delivery Condition as soon as reasonably possibly alter the Target Delivery Date, 3,2 Commencement: Term. 3.2.1 The Term shull continence on the Commencement Date as defined in ftent 3,2 of the Basic Lease Provisions, and shall continue through the period specified in i e n 3.3 of the Basic Lcase Provisions unless terminated easier in accordance with the provisions hereof or extended pursuant to the written agreenhent of Landlord and ']'client or as provided in Section 3.2.2 below, provided, however, that if the Commencement Date shall occur on a day other than the first tiny orally colenclar mouth, for purposes orealeulating the Expiration Date and the liming of all scheduled increases In Base Rent during the hhiflal'ferm (but not liar any other purpose), the Commencement Date shalt be deemed to be the first day orlhe calendar month following the Commencement Dale. At any time during the Lease Term, Landlord may deliver to Tenant a notice in the form as set in Exhibit "B' attached hereto. which Tenant shall oxwute and return to Landlord within five (5) business days of receipt thercur. 3.2.2 Extension Option. 'tenant shall have two (2) options to extend the Tenn, each for all Extension Term (def led below) ofsl.xty (60) months (five (5) years) subject to and in accordance with the terns and conditions of Schcclule "YI"of Exhibit `I", atached hereto. 3.3 Surrender; floldine Over. 3.3.1 Except cis provided in this Suction 3.3 and in Section 7.3 below, upon expiration or earlier termination of this Leasc. Tenant shall vacate and surrender the Premises to Landlord in the sane condition as when received at the inception or this Lease and as thereafter 801 4!'Ciria Center Dr —Clip n/'ShnteiAnn Lease .e- improved by Tenant, subject to ordinary wear and tear, For the avoidance of doubt, it is understood and agreed that, prior to the date upon which the Premises is surrendered by Tenant under [his Section 3.3.1 Tenant shall be requited to remove from the Premises all of the Teases Personal Property and all Leasehold Improvements designated for removal by Landlord in accordance with Section 10S below (and all damage caused by such removal repaired), 3.32 TrTenamt fails to remove any of the Tenant's Personal Property fl•om the Premises (or any portion thereof) prior to the expiration or ally earlier (elimination of the Tenn (with respect to applicable portion of the Premises), and such failure continues Fir five (5) days Following Landlord's delivery of notice thereof, Tenant shall be deemed to have abandoned the same, in which case: (a) Landlord shall have the right, at TenanCs expense, to remove the same from the same from the Premises (and to repair any damage caused by such removal) and (b) to thereafter: (i) store the same at Tenant's expense, (ii) appropriate the same for itself, and/or (lii) sell or otherwise dispose of the same in its sole discretion, with no liability to Tenant, in which case, Tenant shall reimburse Landlord for all costs incurred by Landlord in connection with any such removal, repairs, storage and/or disposal, plus a ten percent (10%) administration fee thereon, upon demand. In addition, If Tenant rails to remove from the Premises (or any portion thereof) all Leasehold Improvements designated for removal by Landlord in accordance with Section 10.5 below and/or to repair oil damage caused by its removal of any such Leasehold Improvements (and/or its Tenant's Personal Property), in either case, prior to the expiration or any earlier termination of ilia Term (with respect to applicable portion of the Premises), Landlord shall have the right to remove line same flronn the Premises (or the applicable portion thereof) and/or to repair such damage at Tenant's expense, in which case, Tenant shall reimburse Landlord for all costs incurred by Landlord in connection therewith, plus a ten percent (100%) administration tee thereon, upon demand. This Section 3.3.2 shall survive the expiration or any earlier termination of the Term of this Lease. 3.3.3 II' Tenant fails to surrender the Premises (or any portion thereof) in accordance with this Lease (Including, without limitation, Section 3.3.1 above), or otherwise holds possession of the Premises (or any portion thereof) after the expiration or termination of the Term, Tenant shall become a tenant at sufferance upon all of the terms contained herein, except as to term and Base Rent, During such holdover period, Tenant shall pay to Landlord a monthly Base Rent in an amount equal to tie Holdover Rental Rate. The monthly Base Rent payable for such holdover period shall in no event be construed as a penalty or as liquidated damages for such retention of possession. Neither any provision hereof nor any acceptance by Landlord of any Rent after any such expiration or earlier termination shall be deemed a consent to any holdover hereunder or result fit a renewal of this Lease or an extension of the Term, or any waiver of any of Landlord's rights or remedies with respect to such holdover. Tenant shall indemnify, defend and hold Landlord harmless from and against any and all Claims (Including, without limitation, for lost profits and other consequential damages, attorneys' fees, consultants' fees and court costs) incurred or suffered by or asserted against Landlord by reason of Tenant's failure to surrender the Premises in accordance will, fire provisions of this Lease on the expiration or earlier termination of this Lease. ARTICLE 4 —RENT AND OTHER CHARGES 4.1 Base Rent. Tenant agrees to pay during the Initial Term of this Lease as Base Rent for tine Premises, the sums shown For the periods shown in Item 4 of' the Basic Lease Provisions. Except as expressly provided otherwise herein, Base Rent shall be payable In equal consecutive monthly installments, in advance, commencing on the Commencement Date and continuing on the tenth (10) day of each calendar month thereafter; provided that the first full monthly Installment of Base Rent, described In IternA of the Basic Lease Provisions, shall be.payable upon Tenant's execution of this Lease. Landlord will cooperate with 'tenant to accommodate payment of Rent (or certain types of Rent) via ACH payments. 4.2 Tenant's Percentage Share, Subject to the provisions of this Lease and in accordance with Exhibit "C', attached hereto, in addition to paying Base Rent, with respect to each Expense Year (defiled in Exhibit "E' Tenant shall also pay: (a) Tenant's Percentage Share (defined in Exhibit "E") of Excess Operating Expenses (defined in Exhibit "E' and (b) Tenant's Percentage Share of Excess Property Taxes (defined in Exhibit "E"). 4.3 Parking Fees. 4.3.1 Subject to Sccti_qn 4 3 2 below, on the first day of each calendar month during the Tenn, Tenant shall pay to Landlord (or at the request of Landlord, to Landlord's designated parking operator) Landlord's then prevailing charge (the "Parking Foes") for all Parking Passes rented by Tenant for such calendar month. Such Parking Fees shall be in addition to all taxes, assessments or other impositions imposed by any governmental entity in connection with Tenant's use of such Parking Posses, which taxes, assessments or other impositions shall be paid. by T'enont, or if required to be paid by Landlord, shall be reimbursed to Landlord (or at the request of Landlord, to Landlord's designated parking operator) by Tenant concurrently with the payment of the Parking pees described above. 4.32 The Parking Fees payable with respect to the first eighty-four (84) Parking Passes rented by Tenant dining the Initial Tenn (and the charges for all Short Tern Project Parking Validations and Long Term Project Parking Validations provided by Landlord to Tenant (pursuant to Section 2 3(c)(N) above) during the Initial 'Penn) are include(? in the Buse Rent payable by Tentnit with respect to the Premises during the Initial Term. 4.3.3 The Parking Pees payable with respect to all Parking Passes rented by Tenant during an Extension Term (and the charges for all Short Term Project Parking Validations and Long Term Project Parking Validations provided by Landlord to Tenant (pursuant to Section 2.3(c)(1i) above) during an Extension Term) shall be determined in connection with the FMRR (and Extension Term Buse Rent) for the prcuhiscs for such Extension Tarn. and shall be added to (and included in) the Extension Term Base Rent. 4.4 Payment of Rem. 4A.1 Generally, Base (tent, till louring of Additional Rent payable hereunder by Tenant and till other nnnonts, fees, payments or charges payable herCWRler by Tenant shall each; (a) constitute rent payable hereunder (sometimes collectively be referred to herein as "Rent"), (b) be payable to Landlord when duo without any prior notice ordemand therefor in lawful money oNlie L)nited States and, except as nnoy be expressly provided to the contrary in this Lease, witwut any nbtitemm11t, offset o• deduc(ion whatsoever. and (c) be payable to Landlord al the address or Landlord described in Iten 10 ofthc Basic Lease Provisions or to such other Person or place ns L.nndloxl may liun (line to them designate 801 W"C'ihic Celne"Dr- City ofSrnun: inn Leta .7. in writing to Tenant. Any amount of Rent that is payable on a monthly basis and glut is payable respect to a partial month, shall be prorated based on the number of days in such month. No payment by Tenant or receipt or acceptance by Landlord of a lesser amount than the con -cot Rent due hereunder shall be deemed to be other than a payment on account of Ole earliest installment of Rent then due; nor shall any endorsement or statement oil any check or any letter accompanying any check or payment as Rent be deemed to effect or evidence an accord and satisfaction; and Landlord may accept such check or payment Without prejudice to Landlord's right to recover the balance or pursue any other remedy in this Lease or at law or in equity provided. 4A.2 LATE PAYMENTS. TENANT ACKNOWLEDGES THAT THE LATE PAYMENT OF RENT WILL CAUSE LANDLORD TO INCUR ADMINISTRATIVE COSTS AND OTHER DAMAGES, THE EXACT AMOUNT OF WHICH WOULD BE IMPRACTICABLE OR EXTREMELY DIFFICULT TO ASCERTAIN. LANDLORD AND TENANT AGREE THAT IF LANDLORD A RENT DELINQUENCY SHALL OCCUR, TENANT SHALL PAY TO LANDLORD, AS ADDITIONAL RENT; (A) A LATE CHARGE EQUAL TO FIVE PERCENT (50K) OF THE OVERDUE AMOUNT TO COVER SUCH ADDITIONAL ADMINISTRATIVE COSTS, AND (B) INTEREST ON ALL DELINQUENT AMOUNTS AT THE DEFAULT RATE, FROM THE DATE DUE UNTIL THE DATE PAID. ARTICLE 5 — TENANT'S TAXES Tenant shall reimburse Landlord upon demand for any and all taxes, impositions or similar fees or charges payable by or imposed or assessed upon Landlord upon or with respect to: (a) any Tenant's Personal Property located in or about the Premises; (b) any Leasehold Improvements made in or to the Promises by or for Tenant (without regard to ownership of such improvements) if and to the extent the original cost, replacement cost or value thereof exceeds the cost of Landlord's then effective "Building Standard" tenant improvements, as determined in good faith by Landlord; (a) the Rent payable hereunder, including, without limitation, any gross receipts tax, license fee or excise tax levied by any governmental authority; (d) the possession, leasing, operation, management, maintenance, alteration, repair, use or occupancy orally portion of the Premises; or (c) this transaction or any document to which Tenant is a party creating or transferring an interest or an estate in the Premises. ARTICLE 6 — IINTENTIONALLY OMITTED] ARTICLE 7-USE OF PREMISES 7.1 Tenant's Permitted Use. Tenant shall use the Premises only for Tenant's Permitted Use set forth in item ofthe Basic Lease ]'revisions and shall not use or permit the Premises to be used for any other purpose. Tenant shall, tit its sole cost and expense, obtain and maintain in full force and effect all governmental licenses, approvals and permits required for Tenant's Permitted Use, In no case shall Tenant use tir suffer or permit the use of any portion of the Premises fur any Expressly Restricted Use. 7.2 Cotmilinnee With Laws and Other Requirements. 7.2.1 Subject to Section 7.2.2 below, Landlord shall cause die Common Areas and the Base Building to comply with all Laws, if and when any such action is required by any governmental authority and/or if and to the extent that any failure of any portion of the Common Areas or the Base Building to comply with my applicable Laws would: (a) prohibit Tenant from entering into a sublease to any Approved County Entity of Approved State Entity (as such terms are defined below) in accordance with Section 11.1.2 below, (b) unreasonably and materially al'I'ect the safety of Tenant's employees or the operation of'fenant's business; or (c) would create a material and significant health hazard I'or occupants of the Premises, 7.2.2 Tenant shall timely take all actions required comply in all respects with (and shall cause each of its employees and occupants to take all actions required Comply in till respects with) and cause the Premises to comply with: (a) all Laws, now or in the future applicable to the Premises and Tenant's use thereof (Including, without limitation, any Law requiring any form of improvement or alteration to the Building), (b) the Rules and Regulations, and (c) all covenants, conditions and restrictions applicable to the Project. In addition, if any modifications or alterations to any portion of the Common Areas or the Base Building (defined below) are required under any applicable Laws as a result of 'I•enont's use of the Premises or any of Tenant's Leasehold hoprovemenfs, then at the election of Landlord: (i) Tenant shall be responsible for performing such modifications or alterations, at its expense or (ii) Tenant shall, within ten (10) days following Landlord's demand therefor together with reasonable supporting documentation, reimburse Landlord for all of its costs and expenses incurred in comlection with Landlord's perfw'mnnce ofsuch modifications or alterations. 7.2.3 Tenant shall not use the Premises, or penult the Premises to be used, in any manner, or do or suffer any act in or about the Premises which: (A) violates or conflicts with ally applicable Law, any of the Rules and Regulations or any covenants, conditions and restrictions applicable to the Project; (B) causes or is reasonably likely to Cause damage to die Project, rile PI'emises or the Building Systems; (C) violates it requirement at, condition of any policy of insurance covering the Project find/or the Premises, or increases the cost of such policy; (D) constitutes or is reasonably likely to constitute a nuisance, annoyance or inconvenience to other tenants or occupants orthe Project or its equipment, facilities or systems or (E) interferes with, or is reasonably likely to hum•fere with, the transmission or reception or microwave, television, radio, telephone, or other communication signals by antennne or other facilities located in the Project, Without limiting the gencrolity of the furegoing, should tiny federal, state or local governmental agency having ,jurisdiction with respect to the establishnnont, regulation m• cnlbrccment of occupational, hesldi or safety standards for employers, employees or tenants impose oil Landlord ur oil Tenant at any time now ur in the fume any requirement or Law relating in tiny manner to the Premises or occupancy thereof; 'Tenant shall, in, its sole cost and expense, comply promptly (or at Landlord's election, bear, the cost orsuch compliance as effected by Landlord) with such requirement or Law. Tenant shall indemnify, defend and hold harmless Landlord rrom and against any and all Claims arising out of or relating to any failm•u of Tenant to perform any of its obligations under this Sochon 72. Landlord shall not enforce the Rules and Regulations in a discriminatory manner; provided that Landlord shall not be liable to 801 II'C!n&' Cellfelbr—Our gf'Snitm: hln Lean -$ Tenant for any violation of any or the Rules and Regulations (or any applicable Laws or covenants, conditions and restrictions applicable to the Project) by any other tenant or occupant of the Project. 7.3 iazardous NI aerials, No Hazardous Materials shall be Handled upon, about, in, above or beneath the Premises or any portion of [lie Project by or on behalf of Ten mat or any other Tenant Parties, Notwithstanding the foregoing, normal quantities of those Hazardous Materials customarily used fit the conduct of general administrative and executive office activities (e.g, copier fluids and cleaning supplies) may be used and stored at the Premises in compliance with all Laws mid [he highest prevailing industry standards. Tenant shall: (a) take all actions (or at Landlord's election, reimburse Landlord for taking all actions) necessary to reslore the Premises or any portion of the Project to the condition existing prior to the introduction of any Tenant's Hazardous Materials, notwithstanding any less stringent standards or reimediation allowable under applicable Environmental Laws and (b) shall indemnify, defend and hold harmless Landlord lino slid against sty and all Claims arising out of or totaling to any Handling by or on behalf of Tenant or any Tenant Party of any Hazardous Materials upon, about, in, above or beneath the Premises or tiny portion of die Project and/or the presence of any Tenant's Hazardous Materials in, on, under or about the Project, ARTICLE 8 - UTILITIES AND SERVICES 8.1 Building Services. Provided that no Event of Default exists, subject to the terns, conditions and standards set forth in this Lease, Landlord shall furnish or cause to be furnished, as part of Operating Expenses to the Premises, the utilities mid services described in Exlhfbf "F" attached hereto. 8.2 Interruntion of Services. Landlord shall not be liable for any failure to ruin ish, stoppage of, or interruption In furnishing oily of the services Or utilities described in Exhibit "F" when such failure is caused by accident, breakage, repairs, strikes, lockouts, labor disputes, labor disturbances, governmental regulation, civil disturbances, acts of war, moratorium or other governmental action, or any other cause beyond Landlord's reasonable control, and, in such event, Tenant shall not be entitled to any damages nor shall any failure or interruption abate or suspend Tenant's obligation to pay Rent under this Lease or constitute or be construed as a constructive or other eviction of Tenant. ARTICLE 9 -MAINTENANCE AND REPAIRS 9.1 Landlord's Obligntions. Landlord shall endeavor to keep file Common Areas of the Building and the Project in a clean and neat condition. Subject to Section 9.2 below: (a) Landlord shall matte all necessary repairs, within a reasonable period following receipt of notice of the need therefor from Tenant, to the exterior walls, exterior doors and windows of the Building, and to public con•idors and other public areas of the Project not constituting a portion of any tenants' premises and (b) shall use commercially reasonable efforts to keep all Building Systems used by Teimt in common with other tenants in reasonable condition and repair, reasonable wear and tear excepted. Except as provided in Section 111, there shall be no abatement of Rent, nor shall there be any liability of Landlord wising from the malting of, or failure to make, any maintenunce or repairs, alterations or improvements in or to any portion of the Building or Project. Tenant waives the right to make repairs at Landlord's expense under Sections 1941 and 1942 of the California Civil Code, slid under all other similar laws, statutes or ordinances now or hereafter in effect, and waives and releases the right to terminate this Lease under Section 1932(1) of the California Civil Code and tinder all other similar laws, statutes or ordinances now or hereafter in effect. 9.2 'tenant's Obligations, During the Tenn of this Lease, Tenant shall, at its sale cost slid expense, maintain the Premises in good order and repair and in a safe, clean and neat condition, Tenant shall make all repairs to the Premises not required to be made by Landlord under Section 9.1 above (including, without limitation, repair or replacement, as applicable, of all damaged and broken fixtures and appurtenances) with replacements of any materials to be made by use of materials of equal or better quality, Further, Tenant shall be responsible for, and upon demand by Landlord shall promptly reimburse Landlord for, any damage to any portion of the Project or the Premises caused by: (a) activities of Tenant or any Tenant Party in at- at file Premises or any other portion ofthe Project; (b) the performance or existence orany Alterations made by or for Tenant or any Tenant Party in or to the Premises; (c) the installation, use, operation Or movenhent of Tenant's Personal Property in or about the Building or the Premises; (d) the design, Installation or operation of any Alterations that are not consistent with Building Standards (as defined in the Work Letter); or (e) any act or emission by Tenant or any Tenant Pauly or oily Other person permitted in or invited to the Premises or the Project by Tenant or any Tenant Party. ARTICLE 10 - AI TERAW)NS 10, I Landlord's Work, Landlord's sole consuoction obligation under [his Lease is set Forth in the Work Letter. Except as expressly provided in the Work Letter. Landlord has shade no representation or waTunty to Tonanl and has no obligntion to alter, reniodel, improve, renovate, repair or decorate the Premises, the Building, or the Project or any portion thereull Tenant further acknowledges tad agrees that no representations respecting the Condition of the Premises, the Building or the Project have been made by Landlord to Tenant except as specifically set forth in this Lease. 10,2 Landlord's Consent: Conditions, Except fbr Permitted Alterations, Tenant shall not male any Alterations (or allow or permit any Alterations to be made) without Flirt obtaining the prior written consent of landlord, which consent shall he requested in writing not less than lifeen (15) business clays prior to the scheduled and actual commencement of any work therein. All such Alterations: (a) shall comply with all applicable Laws, (b) shall Ire compatible (as determined In good Faflh by Ltuldloid) with the Building and all Building Systems; (c) shall not Interfere With the use and Occupancy of any other portinn ol'the Building or the Project by any other tenants or their invitees; (d) shall not be visible from the exterior of the Building or from any Common Arens: End (e) shall not affect tie integrity, of the structund portions of the Building. In add it fun, LmhdIord may impose as a condition to its consent to tiny AItenuions, such additional requirements as Landlord in its sole discretion deems necessary or desirable (melLid! ng, wilhOut limitation, a requfrement for Tenant to Obtain (or retprire its conti actor to obtain) a completion and lien indemnity build prior to commencement al' any Alterations), Within ten (10) days of written demand theefor, Tenant shall: (I) reimburse oil costs and expensesIncurredby Landlord because orTen:uu's Alterations and (ill shell pay Landlord's supervision fee in all amount equal uh ten percent (10%) of the cost of the Alterations in question (provided that no supervision I'ee shall be puyuble with respect to Permitted Alterations). 'Tenant and Ttnunt's contractors shall comply with such cohstraclion rules mil regulations and building standards as Landlord may proomlgato from time to 801 11`Ch le fearer Dr —Qv ofS'nna, Ana Lease .9- time. All direct and indirect casts relating to any modifications, alterations or improvements of the Project or the Building, whether outside or Inside of the Premises, required by any governments] agency or by Low as a condition or as the result orally Alteration requested or effected by Tenant shall be borne by Tenant, and in connection therewith, Landlord may elect to perform such modifications, alterations or improvements (at Tenant's sole cost and expense) or require such performance directly by Tenant. 10.3 Performance of Afterations Work, All work relating to all Alterations (other than the initial Tenant Improvements, which will be performed by Landlord in accordance with the Work Letter) shall be performed by Tenant at Tenant's sole cost and expense and shall be prosecuted to completion in a diligent, first class manner (and so as not to interfere with any other tenants or occupants of the Project), and in compliance wit], any plops and specifications therefor that are approved by Landlord, oily and all conditions imposed by landlord thereon. all Applicable Laws, and the requirements of all carriers of insurance oil the Premises, Building and Project, the Board of Underwriters, Fire Rating Bureau, or similar organization, Tenant shall not use Any portion of the Compton Areas in connection with the making or any Alterations, and Tenant shall not modify or alter oily improvements or components of the Building or the Project outside of the Premises. Upon completion orally Alterations (other than Permitted Alterations), Tenant shalt deliver to the Building management office, within thirty (30) days following completion of the Alterations, a reproducible copy of the "as built" drawings of the Alterations together with a CAD file of the "as built" documents of the Alterations (current version of AutoCad), 10.4 No Liens, Tenant shall pay when due all costs for work performed and materials supplied to the Premises. Tenant shall keep Landlord, the Premises, the Project and Tenant's leasehold interest free from all Encumbrances, including, without limitation, any of the same relating to the Alterations or any other work performed for, materials furnished to or obligations incurred by Tenant, and Tenant shall indemnify, defend and hold harmless Landlord, the Premises and the Project of and from any and all Claims arising cart of or related to any Encumbrances. Tenant shall satisfy or otherwise discharge all Encumbrances within five (5) business days after Landlord notifies Tenant in writing that any such lice, stop notice, claim or encumbrance has been filed. Tenant shall give Landlord not less than five (5) business days' prior written notice before commencing any Alterations in or about the Premises to permit Landlord to post appropriate notices of non responsibility. 10.5 Removal and Restoration. All Alterations (and the Tenant Improvements) shall become a part of the Premises and shall become the property of Landlord upon the expiration or earlier termination of this Lease; provided that by written notice to Tenant, Landlord troy require Tenant to remove some or all of the Leasehold Improvements (other than any Leasehold Improvements that existed in the Building as of the Effective Date), in which event, prior to the date of expiration or termination of this Lease, Tenant shall remove the Leasehold hmprovenrenls designated by Landlord to be so removed, and shall restore, patch and repair any resulting damage to the Premises, Building and Project, all at Tenant's sole expense. All Tenant's Personal Properly owned or Installed by Tenant or any other Tenant Party in the Premises shall be and remain the property of Tenant (or the applicable Tenant Party), and upon the expiration or earlier temmination of this Lease, Tenant shall, at its sole expense, remove all such items and repair any damage to the Premises or the Project caused by such removal. If Tenant fails to remove any such items or repair such damage promptly after the expiration or earlier termination of this Lease, Tenant (or the applicable Tenant Party) shall be deemed to have abandoned the same, in which case Landlord may store the same at Tenant's expense (and Tenant shall pay Landlord the cost thereof upon demand), or appropriate the same for itself, and/or sell the sonic in its discretion, with no liability to Tenant (or the Applicable Tenant Party). ARTICLE II - TRANSFERS 11.1 Restriction; Permitted Sublease$. 1 L1.1 Restriction. Except as provided in Section 11.1.2 below, Tenant shall not, either involuntarily or voluntarily or by operation of law or otherwise, make or permit any Transfer without the prior written consent of Landlord in accordance with Section 11.4 below. Any Transfer fit violation of the provisions of this Article I 1 shall be null and void. Notwithstanding anything contained in this ArliclL 11 to the contrary, Tenant expressly covenants and agrees not to enter into any lease, sublease, license, concession or other agreement for use, occupancy or utilization of the Premises which provides for rental or other payment for such use, occupancy or utilization based in whole or in part on the net income or profits derived by any person from the property leased, used, occupied or utilized, and that any such purported lease, sublease, ficcnse, concession or other agreement shall be absolutely void. 11.1.2 Permitted Subleases. Notwithstanding the foregoing, Tenant may, upon no less than ten (10) business days' prior written notice, but without the need to obtain the consent of Landlord, sublease space within the Premises to any Approved Governmental Entities. Landlord shall cooperate with 'tenant's efforts to consunmwte any such subleases to any such Approved Governmental Entities, including, without limitation, in connection with any proposed Approved sublease to any Approved Governmental Entity, by using commercially reasonable efforts to comply with the State Requirements specified in Eel bit "L" attached hereto. Any sublease permitted without the consent of Landlord nuclei- this Section 11.1.2 (a "Permitted Sublease") shall not be subject to any the requirements, restriction or limitations set forth in Section 11.27 Section 11.3, Section 11.4. Section 11,5, or Section 1 I G below 11.2 Notice to Landlord. If Tenant desires to make a Transfer (other than a Permitted Sublease), then 'reliant shall submit to Landlord; (a) a Proposed Trmhs Per Notice at least twenty (20) business days (And not more than one hundred eighty (180) days) prior to the efteelive date of the proposed Transfer, and (b) four (4) originals ofthe proposed assignment or sublease or other Transfer document on a loin approved by Landlord and Potm (4) originals of the Landlord's Consent to Sublease or Assignnhenl and Assumption of Lease and Consent executed by Tells t and the proposed T'ransreme. If Tenant modifies Any of the material terms And conditions relevant to a proposed Transfer specified in the Transfer Notice, Tenant shall resubmit such Transfer Notice to Landlord for its consent. Following delivery of a Traaslbr Notice, Tenant shall udditiunal[v provide such other information or materials with respect to the proposed Transfer and/or Transferee as Landlord may reasonably request. includillg. wilhoul limitation. Credit reports, business plans, operating history, bank and character references. 11.3 Landlord's Recant re Ruhr$, At any time within twenty (20) business days after Landlord's receipt of all of the inlivnmlion and documents described in Section 11.2,, Landlord may, at its option, in its sole and absolute discretion. by whiten notice to Tenant. elect to; (A) in the case of o proposed sublease, sublease the Premises or the portion thereof proposed m be sublet by Tenant upon the same terms as twse offered to the proposed subtenant; (b) in the case of a propose([ assignmmu, lake on Assignment of this Lease upon the some terns as those Offered to the 80f 11'C'hic Center Dr—Chp nfSantel lla Lease .to_ proposed assignee; or (a) terminate this Lease in its entirety or as to the portion of the Premises subject to lire proposed Transfer, with a proportionate adjustment in the Rent payable hereunder if this Lease is terminated as to less etas all of the Premises, For the avoidance of doubt, this Section shall not apply to any Permitted Sublease. 11.4 Landlord's Consent; Standards, 11.4.1 If Landlord does not exercise any of the options described in Section 11.3 above, than within twenty (20) business days following its receipt of a Transfer Notice (and all of the other items described in Section 11.2 above), Landlord shall notify Tenant whether it will grant or withhold its consent to the proposed Transfer in accordance with Section 1 14 below. Landlord's consent to any proposed Transfer shall not be unreasonably withheld; provided, however, that In addition to any other grounds available hereunder or under applicable Law for properly withholding consent to such proposed Transfer, Tenant acknowledges and agrees that it shall be reasonable for Landlord to withhold its consent to any proposed Transfer if. (a) in Landlord's good thith judgment: (1) the proposed Transferee does not have the financial strength (taking into account all of the Transferee's other actual or potential obligations and liabilities) to perform its obligations with respect to the proposed Transfer (or otherwise does not satisfy Landlord's standards for financial standing with respect to tenants under direct leases of comparable economic scope), (ii) the proposed Transferee is of a character or reputation or engaged in a business which is not consistent with the quality of the Project or the business fled operations critic proposed Transferee are not of comparable quality to the business and operations being conducted by direct tenants of Landlord in the Project or (iii) the use of the Premises, the Building or the Project by the proposed Transferee would: (A) significantly increase pedestrian traffic in slid out of the Building and/or the Project, (13) generate increased loitering in Common Areas, (C) increase security risk, or (D) require any alterations to file Building or the Project to comply with applicable Laws; (b) the proposed Transferee has the power of eminent domain, is a governmental agency or an agency or subdivision of a foreign government; (c) the proposed Transferee intends to use any part of the Premises for a purpose not permitted under this Lease; (it) either die proposed Transferee, at- any person which directly or indirectly controls, is controlled by, or is under common control with the proposed Transferee (i) occupies space in the Project or has negotiated with Landlord within the preceding one hundred eighty (180) days (or is currently negotiating with Landlord) to lease space in the Project or (11) is a direct competitor of Landlord; (a) an Fvent of Default then exists; (f) the proposed' Transfer would cause Landlord to be in violation of another lease or agreement to which Landlord is a party or would give an occupant of the Project a right to cancel or modify its lease; (g) any ground lessor o• mortgagee whose consent to such Transfer is required fails to consent thereto; (h) the terms of the proposed Transfer will allow the Transferee to exercise a right of renewal, right of expansion, right of first offer, or other similar rights held by Tenant (or will allow the Transferee to occupy space leased by Tenant pursuant to any such right); 0) the proposed Transfer would be on economic terms (based upon effective rental rates) more favorable to the Transferee than the economic terms then being accepted by Landlord for comparable direct leasing transactions in the Project; or 0) the proposed Transfer would result in more than three subleases per each full Floor of [lie Premises being in effect at any one time during the Tenn. For the avoidance of doubt, this Section 1 L4.1 shall not apply to any Permitted Sublease 11.4.2 Notwithstanding anything to the contrary in this Lease, if Tenant or any proposed Transferee claims that Landlord has unreasonably withheld its consent or otherwise acted in a manner not permitted under this Article I I then the sole remedy at' Tenant and such proposed Transferee if such claim Is determined by a court of competent ,jurisdiction to be successful shall be a declaratory judgment and an injunction for the relief sought without any monetary damages or other monetary relief. To the mnximum extent permitted by Law, Tenant and each proposed Transferee hereby waive any and all other remedies, Including, without limitation, any right at law or equity to terminate this Lease with respect to any such claim. Tenant shall indemnify, defend, protect unit told harmless Landlord fi•oni any and all Claims involving or asserted by any third party or parties (including, without Iinnitalion, Tenant's proposed Transferee and/or any broker representing 'Tenant and/or such Transferee in connection with a proposed Transfer) claiming they were damaged by Landlord's wrongful withholding or delaying of consent to any proposed Transfer or other breach of this Article 11. Tenant acknowledges dint Tenant's rights under this Article I I satisfy the conditions set forth fit Section 1951.4 of the California Civil Code with respect to the availability to Landlord of certain remedies for n default by Tenant under this Lease. 11.5 'Transfer Profits. Subject to the provisions of this Article 11 if Landlord consents to any Transfer (other than a Permitted Sublease), Tenant shall pay to Landlord fifty percent (50%) of amy Transfer Profits. 'tenant shall provide Landlord with a detailed statement setting forth the calculation of any Transfer Profits that Tenant either has or will derive from a Transler, Landlord or its representative shall have the right at all reasonable times to audit die books and records of Tenant with respect to doe calculation of Transfer Profits. I f such inspection reveals an underpayment by Tenant of Transfer Profits, Tenant shall pay to Landlord the deficiency and the cost or Landlord's audit within ten (10) business days after its receipt of the results of such audit. For the avoidance of doubt, this Section 11.5 shall not apply to any Permitted Sublease 11.6 Landlord's Costs. With respect to each Transfer (other than a Permitted Sublease) proposed to be consummated by Tenant, whether or not Landlord shall grant consent, and whether or not Landlord's consent shall be required, Tenant shall, within ten (10) business days after written request by Landlord, reimburse all of Landlord's Review Expenses relating to such proposed Transfer. For the avoidance of doubt, this Section 11.6 shall not apply to any Permitted Sublease 11.7 Continuing Liability or Tenant. Notwithstanding the consununatton or attempted consummation of any Minister under this Aril le I I (including, but not limited to, any assignment of this [..ease), Tenant shall remain cis filly and prinsurily liable for the payment of Rent and for tine performance of all other obligations of the "Tenant" contained in this lease to the same extent its irthe Transfer had not occuned. Any act or omission crany Transferee that violates the terms of this Lease shall be deenmed a default by Tenant under this L.ense. and fallowing expiration ofthe applicable notice and cure period, shall be deemed an Event of Default, in which case. Landlord may proceed directly against Original Tenant (and/or any of its successors as the "Tenant" hereunder) without the necessity orcxhausting Its remedies against such Trtmslcrce (notwithstanding the fact that the Original Tenant (mid/er any of its successes its the ""Tenant" hereunder) may have assigned all of its right, title and interest in this Leese).Landlord limy consent to subsequent Transfers of this Lease with Transferees of Teruml, upon notice to 'Tenant, but without obtaining its or their consent thereto. and such action shall not relieve Tenant orits liability under this Lease. I L8 Non -Waiver. T'he consent by Landlord to any Transfer shall not relieve Toaut, or any Person clahning through Or under Tenant, of the obligation to obtain tine consent of Lumdfol d. Pursuant to this Article 11, to any lirrther Transl&. Following Lilly Transfer. Landlord limy collect Rau linnet the Transferee without waiving any rights hereunder, and collection nrthe Rent from a Person other than T'ennnl shall not be 801 lVelgle C'unrcr Or—Cilty ofsaaat rl na Lease - 1I- deemed a waiver of any of Landlord's tights under (his Article 11, an acceptance of any Transferee as a tenant of Landlord, or a release of Tenant from the performance of Tenant's obligations under this Lease. A R'1'ICLC 12 -SUBORDINATION AND A11"1'pRNM ENT; ESTOPPEL CERTIFICAT ES; FINANCIAL STATCM GNTS. 123 Subordination and Attmrnmenl, 12.1,1 This Lease, and the rights and interests ofTenunt hereunder, are and shall be subordinate to all Security Instruments which now or hereafter constitute a lien upon or affect the Project, the Building or the Promises and the rights and interests of die Holders of such Security Instruments. Such subordination shall be effective without the necessity of the execution by 'tenant of any additional document for the purpose of evidencing or effecting such subordination. In addition, Landlord shall have die right to subordinate or cause to be subordinated any such Security Instruments to this Lease, and in such case, in the event of the teininntion or transfer of Landlord's estate or Interest in the Project by reason of any termination or foreclosure of any such Security Instruments, Tenant shall, notwithstanding such subordination, mtorn to and become the Tenant of the successor in interest to Landlord at the option of such successor in interest. Furthermore, Tenant shall within Five (5) business days of demand therefor execute any instruments or other documents which may be required by Landlord or the Holder of any Security Instrument, and specifically shall execute, acknowledge and deliver within five (5) business days of demand therefor a subordination of lease or subordination of deed of trust, in the form required by the Holder of the Security Instrument requesting the document. If requested to do so, Tenant shall attom to and recognize as Tenant's landlord under this Lease any superior lessor, superior mortgagee or other purchaser or person taking title to the Building by reason of the termination or foreclosure of any Security Instrument, end Tenant shall, within five (5) business days of demand therefor execute any instruments or other documents which tray be required by Landlord or the Floider of any such Security Instrument to evidence the attornnlent described in this Section 12.1.1. 12.1.2 Should any current or prospective mortgagee or ground lessor for the Building or the Project (or any portion thereof) require a modification or modifications of the Lease, which modification or modifications will not cause an increased cost or expense to Tenant, or in any other way materially and adversely change the rights and obligations of Tenant hereunder, then and In such event, Tenant agrees that this Lease may be so modified and agrees to execute whatever documents are required therefor and to deliver the same to Landlord within ten (10) days following Landlord's request' therefor. 12.2 Cstanoel Certificates. Tenant shall, upon not less than ten (10) business days prior written notice from Landlord, execute, acknowledge and deliver to Landlord a statement in writing certifying those facts for which certification has been requested by Landlord or any current or prospective purchaser or current or prospective Holder of any Security Instrument, including, without limitation, that: (a) this Lease is unmodified and in full force and effect (or setting forth any modifications that have occurred), (b) the dates to which the Base Rent and other forms of Rent payable hereunder have been paid, (c) whether or not Landlord is in default in the performance of any covenant, agreement or condition contained in this Lease (and, if so, specifying each such defnult of which Terna t may have knowledge), and (d) any other facts for which certification is reasonably required by Landlord or customarily required by any prospective purchaser or Holder to which such estoppel certificate is being provided. 'line form of the statement attached hereto as Exhibit 'T is hereby approved by Tenant for use pursuant to this Section 12.2, but Landlord shall have the right to use other forms far such purpose, Tenant's failure to execute and deliver such statement within such time shall be conclusive upon Tenant that this Lease is in full force and effect without modification except as may be represented by Landlord in soy such certificate prepared by Landlord and delivered to Tenant, Any statement delivered pursuant to this Section 12.2 may be relied upon by any prospective purchaser, mortgagee, ground lessor or other like encumbrancer thereof or tiny assignee of any such encumbrance upon the Building or the Project. 12,7 rinancinl $tnteliients--At an 4i»e darin "'the Term`, —Tenant shall; u on five 5 business da s"prior notice from Landlord, Y g Pi) Y P provide Landlord with then current financial statements slid financial statements for each of the two (2) years prior to the then current calendar year for each of Tenant and the Guarantor (if tiny). Such statements shall be prepared in accordance with generally accepted accounting principles, consistently applied, and shall be audited by an independent certified public accountant. ARTICLE 13—CASUALTY;TAKING 13.1 Caanaltx' 13.1.1 Repair of the Premises. 'tenant shall promptly notify Landlord in writing (a "Damage Notice") of any casualty event, damage or condition to which this Section 13.1 is or may be applicable (a "Casualty"). Landlord shall, within a mason able time altm the discovery by Landlord of any damage resulting from uny Casualty ("Casualty Damage"), subject to reasonable delays for insurance adjustment or other matters beyond Landlord's reasonable control, and subject to all other terms of this Section 13.1, begin to repair the lounge to the Project and the Premises resulting fhom such Casualty, and shall proceed with reasonable diligence not to exceed 60 days to restore the Project slid Premises (tine "Restoration") to substantially the same condition as it existed before such Casualty, except for modifications required by applicable Laws or covenants, conditions and restrictions, and modifications deemed desirable by Landlord; provided, however, that Landlord shall not be required to repnlr or replace any orthe Leasehold Improvements or any of Tenant's Personal Properly (all of which shall be promptly repaired, restored and/or replaced by Tenant). Landlord shall have no liability for any inconvenience or annoyance to Tenant or injury to Tenant's business as a result oruny Casually, or the Res(oration, regardless of the cause there For, Base Rent, and Additional Rent payable under Sections 4.2 and 4_3, shall abate if tend to the extent Tenant causes to occupy a mnleriai portion of (ic Premises that was damaged by a Casually and rendered unfit for• occupancy (for tie Permitted Use) as a result thereon for (Ire period of time commencing on the date Tenant vacates such dnnmged portion of the Premises and Continuing until the Premises Resumption is substantially complete (as reasonably determined by Landlord); provided, however, that such abatement shall be limited to the proceeds of rental interruption insurance proceeds with respect to the Premises and such Casualty collected by Landlord. 13A.2 Exceptions in Landlord's Oblisa(innx, Notwithstanding anything to the contrary contained in this Section 13.1, Landlord shrill have no obligation to repair the Premises and shall have the right to terminate this Lease in tiny case where: (a) any portion of the premises or any material portion of the Project is dr mooed and (b) tiny of the following conditions exist: (i) Landlord estimates in good faith that the Restoration cannot reasonably be completed (without the payment ofovertime) within one hundred eighty (ISO) days orl.andhord's discovery oftlhc 801 .12- Casualty Damage, (ii) the Holder of any Security Instrument requires any insurance proceeds with respect to such Casualty Damage to be applied to the outstanding balance of the obligation secured by such Security Instrument, (ill) the cost of the Restoration is not fully covered by Insurance proceeds available to Landlord and/or payments received by Landlord from tenants, IN) Tenant shall be entitled to all abatement of Rent under this Section 13.1 for a period or time in excess of thirty-three percent (33%) of the remainder of the Term, or (v) such Casualty occurs during die last eighteen (19) months or dic Term (disregarding Extension Terms, if any). Such right of termination shall be exercisable by Landlord by delivery of written notice to Tenant al any time following die Casualty until sixty (60) days following the later of: (A) delivery of the Damage Notice or (B) Landlord's discovery or determination of any of the events described in clauses (i) through (v) of the preceding sentence, and shall be effective upon delivery ofsuch notice oetermination (or if Tenant has not vacated the Premises, thirty (30) days thereafter). 13.1.3 Waiver. Landlord and Tenant agree that the provisions of this Section 13.1 and the remaining provisions of this Lease shall exclusively govern the rights and obligations of the parties with respect to any and all damage to, or destruction of, all or any portion of the Premises or the Project, and Landlord and Tenant hereby waive and release each and all of their respective coalition law and statutory rights Inconsistent herewith, whether now or hereinafter in effect (including, without limitation, Sections 1932(2) and 1933(4) of the California Civil Code, as amended from time to time). 13.2 Taking,. If the whole or a material portion of the Promises, the Building or the Project shall be taken under the power of eminent domain, or sold to prevent the exercise thereof (collectively, a "Taking"), this Lease shall automatically terminate as of tie earlier of the date of transfer of title resulting from such Taking or the date of transfer of possession resulting from such Taking (the "Taking Date"). in the event of a Taking or such portion of the Project, the Building or die Premises as shall, in die opinion of Landlord, substantially interfere with Landlord's operation thereof, Landlord may terminate this Lease upon thirty (30) days written notice to Tenant given at any time within sixty (60) days following the Taking Date. Ira portion of the Premises is so,taken and this Lease is not terminated: (a) Landlord shall, with reasonable diligence and at Landlord's cost (to the extent of the condemnation award received by Landlord), proceed to restore (to the extent permitted by Laws and covenants, conditions and restrictions then applicable to the Project) the Premises (other than Tenant's Personal Property and Leasehold Improvements that are not consistent with then Building Standards) to a complete, functioning unit and (b) the Base Rent payable hereunder shall be reduced proportionately based on the portion of the Premises so taken. Except as expressly provided otherwise in this Section 13.2, the entire award for any Taking shall belong to Landlord (without deduction for any estate or interest of Tenant), except that Tenant shall be entitled to independency pursue a separate award for the loss of, or damage to, Tenant's Personal Property and Tenant's relocation costs directly associated with the Taking (but Tenant shall not otherwise assert any claim against Landlord or die condemning authority). No Taking of any portion of the Premises, the Building or the Project (or any portion fiercer) for a period of less than two hundred seventy (270) days (a "Temporary Taking") shall terminate this Lease or entitle Tenant to any abatement of the Rent payable to Landlord under this Lease; provided, however, that any award for any such Temporary Taking shall belong to Tenant, but only to the extent that the award applies to any time period during the Tenn of this Lease. This Section 13.2 shall be Tenant's sole and exclusive remedy in the event of a Taking. Each party hereby waives the provisions of Sections 1265.130 and 1265.150 of the California Code of Civil Procedure and the provisions of any successor or other law of like import. ARTICLE 14—INDENINIFIC \TION AND INSURANCE 14.1 Waiver of Liability and Indenwificatimt. Except to the extentexpressly provided to the contrary herein, Tenant hereby waives all claims and causes of action against Landlord and all of the other Landlord Parties for any damage to persons or property (including, without limitation, loss oPprofits and intangible property) in any way relating to Tenant's use and occupancy of the Premises from any cause whatsoever, including, without limitation tire, explosion, falling plaster, steam, gas, air contaminants or emissions, electricity, electrical or electronic emanations or disturbance, water, rain or snow or leaks from any part the Building or tiom the pipes, appliances, equipment or plumbing works or from the roof, sheet or sub-surfihee Or from any other place or caused by dampness, vandalism, malicious mischief. Tenant shall indemnify, defend, protect and hold harmless Landlord and each of the Landlord Parties from and against any and all Claims that arise out of, are occasioned by or are in any way attributable to: (a) the use or occupancy of the Premises or any portion of the Project by Tenant, (b) the acts or omissions of Tenant or any Tenant Party, (c) any default of this Lease by Tenant, or (d) any litigation or other proceedings between Tenant slid any third party; provided that Tenant shall not be required to so indemnify, defend or hold Landlord or any ofthe other Landlord Parties harmless to the extent that any such Claims arise out of the grass negligence or wlllftd misconduct of Landlord, its agents or employees. 14.2 Insurance. At all times during the Term of this Lease, Tenant shall: (a) procure and maintain, at its sole expense, the insurance policies described in Exhibit "C", auached hereto and (b) otherwise comply with each and all of the obligations and requirements set forth in Exhibit "C". Landlord makes no representation that the insurance coverage specified to be carried by Tenant pursuant to this Exhibit •'G' is adequate to protect Tenant against Tenant's undertakings under the terms of this Lease or otherwise, and if Tenmit believes that such insurance coverage required under this Lease is insuflicicot, at its own expense, Tenant shall provide such additional insurance as Tenant decals adequate. 14.3 Waiver or Subrogation. Notwithstanding any provision of this Article 14 to the contrary, Landlord and Tenant intend dint their respective properly damage loss risks shall be borne by their respective insurance carriers to the extent of the property damage insurance that each of Landlord and Tenant are required to carry wider Exhibit "C", and except as expressly provided otherwise In this Lease, in the event of a property loss. each of Landlord and 'Tenant hereby agree to look solely to, and seek recovery only from, their respective property damage insurance carriers to the extent that such properly loss is of a type that is covered by the property damage insurance it is required to carry under Exhibit "C As long as such cowers of subrogation are reasonably available, each of the parties hereto hereby waives all OT ils rights and claims against each of the other parties hereto fir such losses. and provided such waiver of subrogation shall not affect the right of such party as the insured under its property damage policy for policies) to recover thereunder, wolves all art e rights of subrogation of its property damage insurers. The parties hereto further agree that, so long as no material additional premium is charged therelbre, their respective property insurance policies ere now, or shall be, endorsed such that the Ibreguing waiver ofsubrogaiion shall not affect the right of the insured to recover dhertundcr. ARTICLE 15— EVENTS OF DEFAuL r AND RENT EMS 15.1 klvenls or Default By Tenant; The occurrence or any of lire Following shall Constitute a material default and breach of this Lease by Tenant (tin "Event of Defnult'•): 3llf W'CA•it' CvnNr Dr —City• n%Santa: I tan Lame .I }- 15.1.1 Any failure by Tenant to pay any Rent or any other charge required to be paid under this Lease, or any part thereof (or to perform any of its obligations under Article 6 above), If such failure continues for three (3) days following Landlord's del ivory of written notice thereof. 15.1.2 The abandonment of the Premises by Tenant, or the vacation of the Premises by Tenant for a period of ten (10) consecutive days (with or without the payment of Reno, or the failure of Tenmht to take occupancy of the Premises within thirty (30) days of the Commencement Date (it being agreed that the fact that any of Tenant's Property remains in the Premises shall not be evidence that Tenant has not vacated or abandoned the Premises). 15.1.3 Any failure by Tenant to execute and deliver any statement or document described in Article 12 requested by Landlord within the time periods specified therein, If such failure continues for three (3) days after Landlord's delivery al'wrilten notice thereof, MIA The failure by Tenant to observe or perform any other provision orthis Lease to be observed or performed by Tenant, other than those described in Sections 15.1.1, 15_1.2 and 15.1 above, if such failure continues for twenty (20) days (except where a different period of time is specified in this Lease, in which case such different time period shall apply) after Landlord's delivery of written notice thereof; provided, however, that if the nature of the default is such that it cannot be cored within the twenty (20) day period, no Event of Default shall exist if Tenant commences the curing of the default within the twenty (20) day period and thereafter diligently prosecutes the same to completion. 15.1.5 The making or furnishing by Tenant of any warranty, representation or statement to Landlord in connection with this Lease, or any other agreement to which Tenant and Landlord are parties, which is false or misleading in any material respect when made at - famished. 15.1.6 The assignment, subletting or other Transfer, or any attempted assignment, subletting or other Transfer, of this Lease in violation of Article 11, 15.1.7 The filing or execution or occurrence of any one of the following: (a) a petition in bankruptcy or other insolvency proceeding by or against Tenant or any general partner of Tenant, (b) a petition or answer by Tenant or any general partner of Tenant seeking relief under any provision of the Bankruptcy Act, (c) an assignment by Tenant or any general partner of Tenant for the benefit of creditors, (d) a petition or other proceeding by or against Tenant or any general partner of Tenant fbr the appointment of a trustee, receiver or liquidator of Tenant or any general partner or Tenant or any property of Tenant or any general partner of Tenant, (a) a proceeding by any governmental authority for the dissolution or liquidation of Tenant or any general partner of Tenant or any other instance whereby Tenant or any general partner of Tenant shall cease doing business as a going concem, or (f) an admission by Tenant or any general partner of Tenant of its inability to pay its debts as they become due. 15.1.8 The default by any guarantor of 'Tenant's obligations hereunder under any guaranty of this Lease, the attempted repudiation or revocation of any such guaranty, or die participation by any such guarantor in any other event described in this Section 15.1 (as if this Section 15,US referrcd to such guarantor (n place of Tenant). 15.1.9 Any default that continues beyond the applicable notice and cure period by Tenant or any Affiliate of Tenant under any lease (other than this Lease) between: (a) landlord or any Affiliate of Landlord and (b) Tenant or any Affiliate of Tenant. All of the notices described in this Section 15.1 shell be in lieu of, and not in addition to, any notice required under Section 1161 of the California Code of Civil Procedure a• any other law now or hereafter in eflact requiring that notice of default be given prior to tie commencement of all unlawful detainer or other legal proceeding. 13.2 Remedies. Upon the occurrence of tiny Event of Default by Tenant, in addition to illy other remedies available to Landlord at law or in equity, without any further notice or demand whatsoever Landlord shall have the option to pursue any one or more of Me remedies described in Section 1 of Exhibit "N' attached hereto, each and all of which shall, subject to applicable law, be cumulative and nonexclusive (and all of the other provisions of Se, ction 1 of Exhibit "H" shall apply to an Event of Delault by Tenant hereunder). ARTICLE 16— LANDLORD DEFAULT LANDLORD'S 11ABT1 ITl' 16.1 Landlord Default. Landlord's failure to perform or observe any of its obligations under this Lease shall constitute a material default by Landlord under this Lease (a "Landlord Defnult") only if such failure shall continue for a period of thirty (30) days after landlord (tad each Notified Party) receives written notice Rom Tenant specifying (and describing in reasonable detail) the alleged delcoth. (and identifying the applicable Lease p ovision(s)); provided, however, that it the nature of the default is such that it cannot be cured within the thirty (30) day period, no Lundlord Default shall exist if Landlord (o• any Notified Party) commences the curing of the applicable default within thirty (30) days following its receipt of Tenant's default notice and thereafter diligently prosecutes the same to completion. Subject to the remaining provisions of this lease, rollowing die occurrence of any Landlord Default, Tenant shall have the right to pursue any remedy available under Law for such Landlord Default by Landlord; provided, however, that in no case shall Tenant have any right to terminate this Lease on account array such Landlord Default. 10.2 Landlord's Lease Undertakines. Notwithstanding anything to the contrary contained in this Lease or any other Lease Documents, it is expressly understood and agreed by and between the parties hereto that; (n) the recourse of Tenant or its successors• or assigns against Landlord (and the liability of Landlord! to Tenant, Its successors aunt assigns) with respect to: (i) any actual or alleged breach or breaches by or on the part of Landlord of any of Landlord's Lease Undertakings or (ii) any neuter retailing to Tenant's use or occupancy or the Premises shall be limited to all amount equal to the lesser oF. (x) Landlord's equity interest in the Building and (y) the equity interest. Landlord would have in the Building Ville Building were encumbered by inclependent secured financing equal to eighty, percent (80%) of the value of the Building; (b) Tenant shall have no recourse against any other assets of Landlord or any other Landlord Parties (or their officers, director o'sharcholders), (e) except to the extent of Landlord's equity interest in tine Building(to the extent provided above), no personal liability or personal responsibility orally sort with respect to tiny of Landlord's Lease Undertakings or any alleged breach thereof is assumed by, or shall at any time be asserted or colbreeable against, 8M W C'11* Center Ur— C'fry, nJ:Srrnlaarrrr Lena -1 J- Landlord or oily of the other Landlord Parties, and (d) at no time shell Landlord be responsible or liable to Tenant for any lost profits, lost economic opportunities or any form of consequential damage as the result of any actual or alleged breach by Landlord of Landlord's Lease Undertakings car in connection with any other matter relating to Tenant's use or occupancy of the Premises, 16.3 Sale. by Landlord. A sale or conveyance by Landlord of the Project or of any portion thereof containing the Premises shall operate to release Landlord firm any liability with respect to any of the agreaments, obligations, covenants or conditions, express or implied, herein contained in favor of Tenant flint are to be performed after (and/or that first acenre after) such sale or conveyance, and Tenant agrees to look solely to the successor in interest of Landlord in and to this Lease far the performance of all of the agreements, obligations, covenants or conditions, express or implied, herein contained in favor or Tenant that ere to be performed after (or that first accrue after) such sale or conveyance (and for satisfaction of all liabilities arising out of the same). This Lease shall not be affected by any such sale, however, and Tenant agrees to attorn to the purchaser or assignee, such adornment to be effective and self -operative without the execution orally further instruments by oily of the parties to this Lease. ARTICLE 17-MISCELLANEOUS 17.1 Nritheli, All notices, requests and/or demands which Landlord or Tenant may be required, or may desire, to serve oil the other (or any Holder) shall, except as expressly provided otherwise herein, be in writing and may be served, as an alternative to personal service, by mailing the same by registered or certified mail, postage prepaid, or by a reputable overnight courier service, which provides evidence of delivery, addressed to the Landlord at the address for Landlord set forth in Item 11.2 of the Basic Lease Provisions and to Tenant at the address for Tenant set forth in Item 11 of the Basle Lease Provisions, or, from and after the Commencement Date, to the 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 fhmn time to time designate written notice to the other. Any Snell notice, request or dennand shall be deemed to have been served at tine time the same was posted. 17.2 Brokers. The parties recognize as the broker(s) who procured this Lease, the firm(s) specified ill Item 9 of the Basic Lease Provisions and agree that Landlord shall be solely responsible for the payment orally brokerage commissions to said broker(s), and that Tenant shall have no responsibility therefor unless written provision to the contrary has been made a part of this Lease. If Tenant has dealt with any other person or real estate broker in respect to leasing, subleasing or renting space in the Building, Tenant shall be solely responsible for the payment of any fee due said person or firm and Tenant shall protect, indemnify, hold harmless and defend Landlord from any Claims relating thereto. 17.3 Riahts Reserved by Landlord. 17.3. t Entry by Landlord. Landlord may enter the Premises at all reasonable times to: (a) inspect the same; (b) exhibit the same to prospective purchasers, leaders or tenants; (c) determine whether Tenant is complying with all of its obligations under this Lease; (d) supply janitorial and other services to be provided by Landlord to Tenant under ibis Lease; (a) post notices of non -responsibility; (e) exercise any of Landlord's rights or perform any of Landlord's obligations under this Lease; (t) make repairs or improvements in or to the Project or the Premises (provided, however, that all such work shall be done as promptly as reasonably possible and so as to cause as little Interference to Tenant as reasonably possible) or (g) for any other reasonable purpose. Tenant hereby waives any claim for damages for any injury or inconvenience to, or Intel ference with, Tenant's business, any loss of occupancy or quiet enjoyment of the Premises or any otlier loss occasioned by such entry. Landlord shall at all times have and retain a key with which to unlock all of the doors in, on or about the Premises (excluding Tenant's vaults, safes and similar areas designated by Tenant in writing in advance), and Landlord shall have the right to use oily and all means by which Landlord may deem proper to open such doors to obtain entry to the Premises, and any entry to die Premises obtained by Landlord by any such means, or otherwise, shall not under any circumstances be deemed or construed to be a forcible or unlawful entry into or a detainer of the Premises or an eviction, actual or constructive, of Tenant from any pall of tine Premises. Such entry by Landlord shall not act as a termination of Tenant's duties under this Lease. If Landlord shall be required to obtain entry by means other than a key provided by Tenant, the cost ofsuch entry shall be payable by Tenant to Landlord. 17.3.2 Right m Lease; Proieet or Buildlne Na ne and Sienage, Landlord reserves the absolute right to: (n) lease space in flit Project and to create such other tenancies in the Project as Landlord, in its sole business judgment, shall determine is in the best interests of the Project; (b) to change the name or street address of Are Building midlor the Project; and (a) to install, affix and maintain any and all signs on the exterior and on die interior of the Building and/or the Projeot as Landlord may so desire, in its sole discretion. Landlord does not represent and Tenant does not rely upon any specific type or number orvenants occupying oily space in the Building or the Project during the Tenn of this Least, Tenant shall not, without die prior written consent of landlord, use the name of the Building and/or the Project, m' any pictures or illustrations of the Building and/or the Project, in Tenant's advertising or in any other publicity, and to tie extent that Landlord grants such consent, shall refer to the Building and/or the Project by the name designated by Landlord. 17.3.3 The Other Imv'uvemonts, If portions of the Project or pheperly adjacent to the Project (collectively, tine "Other improvements") are owned by an entity other than Landlord, Landlord, at its option, in its sole and absolute discretion, may enter into an agreement with the owner or owners of any or all of the Other Improvements to provide: (a) for reciprocal rights of access and/or use of the Project and the Other Improvements; (b) for the common umnagement, operation, maintenance, improvement and/or repair of all or any portion of the Project and the Other Improvements; (c) for the allocation of a portion of the Operating Expenses to the Other Improvements and the operating expenses and taxes for the Other Improvements to the Project: and (d) for the use or improvement of the Other Improvements and/or the Project In connection with the. improvement, construction, and/or excavation of the Other Improvements and/or the Project. Nothing contained herein shall be deemed or construed to limit or otherwise ulTect I.ardlord's right to convey all or any portion of the Project or any other of Landlord's rights damribed in this Lease 17.3:4 RLnovIttimt of the Proieet and Other Immrovements/Construction of New Improvements. Tenant acknowledges that portions of the Project tad/or the Other Improvements may he under construction following Tenant's occupancy or the Premises, and that such construction may result in levels or noise. dust, ohsheclion of access. etc. which are in excess orthat present in a tldly constructed project. Tenant acknowledges and agrees that Landlord may alter. remodel, improve and/or renovate (collectively, tile "Construction Work") the Building. Premises, and/or the Project (including, without Ilnnitrdion, by constructing new improvements in Common Arens), and in connection with oily Construction Work, Landlorl nary. among other things, erect scal7olding or other necessary structures in the Building, or elsewhere in or at the 861 I$'Cirir C'enler Dr— C'io'ofsat'lu Urn Leave -15- Project, restrict access to portions of the Project, including portions of the Common Areas, or perform work in the Building and/or the Project. Tenant hereby agrees that such Construction Wild< and Landlord's actions in connection with such Construction Work shall in no way Lonsllt.1 Life a constructive eviction of Tenant nor entitle Tenant to any abatement of Rent. Landlord shall have no responsibility or liability to Tenant for any injury to or interference with Tenant's business arising from any such Construction Work, and Tenant shall not be entitled to any damnges from Landlord for loss of use of the Premises, in whole or In port, or for loss of Tenant's personal property or improvements, resulting from the Construction Work or Landlord's actions in connection therewith or Far any inconvenience occasioned by such Construction Work or Landlord's actions fn connection therewith. 17.3.5 Other Rights Reserved by Landlord. Landlord reserves the following rights exercisable without notice (except as otherwise expressly provided to the contrary in this Lease) and without being, deemed an eviction or disturbance of Tenant's use or possession of the Premises or giving rise to any claim for set-off or abatement of Rent: (a) to designate and/or approve prior to installation, all types of signs,.window shades, blinds, drapes, awnings or other similar items, and all internal lighting that may be visible from the exterior of the Premises and, notwithstanding the provisions of Article 10• the design, arrangement, style, color and general appearance of the portion of the Premises visible from the exterior, and contents thereof, including, without limitation, firrniture, fixtures, signs, art work, wall coverings, carpet and decorations, and all changes, additions and removals thereto, shall, at all times have the appearance of premises having the same type of exposure and used for substantially the same purposes that are generally prevailing in first class office buildings in the area; (b) to display the Premises and/or the Building and/or the Project to mortgagees, prospective mortgagees, prospective purchasers and ground lessors at reasonable hours upon reasonable advance notice to Tenant; (c) to change the arrangement of entrances, doors, corridors, elevators and/or stairs fn the Building and/or the Project, provided no such change shall materially adversely effect access to the Promises; (d) to grant any party the exclusive right to conduct any business or render any service in the Building or fit the Project, provided such exclusive right shall not operate to prohibit Tenant from using the Premises for the purposes permitted tinder this Lease; (e) to prohibit the placement of vending or dispensing machines of any kind in or about the Premises other than for use by Tenant's employees; (0 to prohibit the placement of video or other electronic games in the Premises; (g) to have access for Landlord and other tenants of the Building to any mail chutes and boxes located in or on the Premises according to the rules of the United States Post Office and to discontinue any mail theta business in the Building and/or the Project; (h) subject to Tenant's rights or access under Section 2.1.3, to close the Building after normal business hours, except that Tenant and its employees and invitees shall be entitled to admission at all Imes tinder such rules and regulations as Landlord prescribes for security purposes; (I) to install, operate and maintain surveillance systems which monitor, by closed circuit television or otherwise, all persons entering or leaving the Building and/or the Project; 0) to install and maintain pipes, ducts, conduits, wires and structural elements located in the Premises which serve other parts or other tenants of the Building and/or the Project; (k) to retain at All times master keys or pass keys to the Premises; (1) to modify, change, add to or delete the design, configuration, layout, size, ingress, egress, areas, method of operation, and other characteristics of or relating to the Parking Facilities at any time, and/or to provide for nonuse, partial use or restricted use of portions thereof, (m) to delegate control of the Parking Facilities to a parking operator (and/or to master lease the Parking Facilities to a parking operator) in which case Landlord may assign any or all of the rights, Inoluding rights of control, attributed hereby to the Landlord to such parking operator, and (a) to take (and require Tenant to take) reasonably appropriate action to comply with any Law or mandatory controls or voluntary controls promulgated by any governmental or quasi -governmental authority or public utility relating to: (i) the use or conservation of energy, water, gas, light or electricity, reduction of automobile or other emissions, or the provision of any other utility or service and/or (if) die reduction and/or management of tragic, transportation or parking fit or around the Project. 17.4 Light and Air. No diminution or shuttng off of any right, air or view by any structure now or hereafter erected shall fn any manner affect this Lease or the obligations of Tenant hereunder, or increase any of the obligations of Landlord hereunder. 17.5 Force Majeure. Landlord shall incur no liability to Tenant with respect to, and shall not be responsible far any failure to perform any of Landlord's obligations hereunder if such failure is caused by any reason beyond the control of Landlord, including, but not limited to, strike, labor trouble, governmental rule, regulations, ordinance, statute or interpretation, or by tire, earthquake, civil commotion, or failure or disruption of utility services (a "Force Majeure Event"). The amount ortime for Landlord to perform any of Landlord's obligations shall be extended by the anaunt of time Landlord is delayed fit performing such obligation by reason or any such Force Majeure Event whether sinhflar to or different from the foregoing types ofoccurrences. 17.6 Attornevs'Fees: Oovaufne Law: No Counterclaim; Chat cc of Lawn Waiver of Jury Trial 17.6.1 Attorneys' Fees. If either Landlord or Tenant shall commence any action or other proceeding against the other arising cut of, or rcloting to, this ]..ease or the Premises, the prevailing party shall be entitled to recover from the losing party, in addition to any other relief, its actual attorneys' fees irrespective of whether or not the action or other proceeding is prosecuted to judgment and irespocrive of any court schedule orreasonable attorneys' fees. In addition, Tenant shall reimburse Landlord, upon demand, for all reasonable nuorneys' fees incurred in collecting Rentor otherwise seeking enforcement against Tenant, its sublessees and assigns, of'renanPs obligations under ()its Lease. IT6.2 Oovernina Law, This Lease shall be governed by, and construed in accordance with, the Imes of' the state of California (without regard to its conlliet of laws principles). 17.6.3 Choice of Jurisdiction. Tenant hereby submits to local jurisdiction in the State of California and agrees that any action by Tenant against Landlord shall be Instituted fn the State of California and that Landlord shall have personal jurisdiction over Tenant for ally action brought by Landlord against'renant in the State of Calilbruia. 17.6A Waiver or Triad by Jury. TO THE FULLEST EXTENT PERMITTED BY LAW, LANDLORD AND TENANT EACH EXPRESSLY WAIVE THEIR RIGHT TO TRIAL. BY JURY IN ANY TIMAL I IELD AS A RESULT OF A CLAIM ARISING OUT OF OR IN CONNECTION WITH THIS LEASE IN WHICH LANDLORD AND TENANT ARE ADVERSE PARTIES. RIE, PILING OF A CROSS. COM PLAINT BY ONE AGAINST TI IE OTHER IS SUFFICIENTT'0 MAKE THE PARTIES "ADVERSE" 17.7 OFAC Compliance. Tenant represents, warrants and covenants to Landlord: (a) that neither the Tenant nor any person or entity that directly owns it I0%or greater equity interest in it nor any of its officers, directors or managing members is a person or enlity with whom U.S, Y01 W'C'irie Center Dr —CIO, n/'Swrla Ana Lease -16- persons or entities are restricted from doing business under OPAC regulations (including those named on OFAC's Specially Designated and Dlooked Persons List) or under any statute, executive order (including, without limitation, Executive Order 13224, or other governmental action, (b) that Tenant's activities do not violate the Money Laundering Act, slid (c) that throughout the tern of this Lease the Tenant shall comply with Executive Order 13224 and with the Money Laundering Act. 17.8 State Snecific Requirements, 17.8.1 California Civil Code Section 1938. As of the dale of this Lease, the Promises, Building and Project have not been inspected by a Cerlified Access Specialist ("CASp') as referred to in Section 1938 of the Caliromin Civil Code. A CASp can inspect the subject premises and determine whether the subject premises comply with all or the applicable eonstmclion-reloted accessibility standards under state Inw, Although state law does not require a CASp inspection of the subject premises, the commercial property owner or lessor may not prohibit the lessee or tenant lbom 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 [he CASp Inspection, the payment of the fee for the CASp inspection, and lie cost of making any repairs necessary to correct violations of construction -related accessibility standards within the Premises. 17.8.2 California Public Resources Code Section 25402.10, Pasuait to California Public Resources Code Section 25402.10 and the regulations adopted thereunder (together with any fidtue law or regulation regarding disclosure of energy efficiency data with respect to the Project, the "Electrical Energy Disclosure Laws"): (u) Landlord is or may be required to disclose to third parties (including, without limitation, prospective purchasers, lenders and tenants of the Project) information concerning the amount of electrical power consumed at the Project ("Electrical Energy Use Disclosures"), mud (b) in order to make such Electrical Energy Use Disclosures, Landlord may need to obtain information regarding Tenant's consumption of electrical power in the Premises (if and to the extent that delivery of electrical power to the Premises or any applicable portion thereof that is measured by a meter in Tenant's name). Accordingly, Tenant agrees to cooperate with Landlord f l connection with any such Electrical Energy Use Disclosures, including, without limitation, by providing to Landlord, within ten (10) days following Lessor's request therefor: (I) copies of (or uccess to) bills or other records reflecting the delivery of electrical power to the Premises or any applicable portion thereof that is measured by a meter in Tenant's name and/or (H) other infomation (such as without limitation, the number of employees regularly working at the Premises (or any applicable portion thereof), the types of equipment regularly used at the Premises (or any applicable portion thereof) and/or the regular operating hours at the Premises (or any applicable portion thereof)) that is reasonably required for Landlord to estimate the anounl of electrical power consumed at due Premises. 17.9 ;:air Emnlavmont Landlord agrees, subject to applicable laws, rules and regulations, tlmt no person shall be subject to discrimination in the performance of this Lease on the basis of race, color, religion, national origin, sex, sexual orientation, gender identity, AIDS, HIV status, age, disability, handicap or veteran status. Landlord shall take affirmative action to ensure dust applicants are employed and drat employees are treated during employment without respect to any or these bases, including but not limited to employment, upgrading, demotion, transfer, recruitment, recruitment advertising, layoff, termination, rates orpiy or other forms of compensation, mid selection for training, including apprenticeship. 17.10 Interpretation, Tenant acknowledges dint it has read and reviewed this Lease and that it has had the opportunity to confer with counsel in the negotiation of this Lease. Accordingly, this Lease shall be construed neither for nor against Landlord or Tenant, but shall be given a fair and reasonable interpretation in accordance with the meaning of its terms and the intent of the parties. All captions, headings, titles, numerical references and computer highlighting are for convenience only and shall have no effect on the interpretation of this Lease. All terms and words used in this Lease, regardless of the number or gender in which they are used, shall be deemed to include the appropriate number and gender, as the context may require, Each covenant, agreement, obligation or other provision of this Lease to be performed by recant are separate and independent covenants of Tenant, and not dependent on any other provision or this Lease. Time is of the essence of this Lease and due performance of all obligntions hereunder. In the event any prevision of this Lease is found to be unenforceable, the remainder of this Lease shah not be affected, and any provision found to be invalid shall be enforceable to the extent permitted by law. The parties agree that irtwo different interpretations may be given to any provision Hereunder, one of which will render the provision unenforceable, and one orwhich will render the provision enforceable, the interpretation rendering the provision enforceable shall be adopted. 17,11 No Partnership or Joint Venture: No 'rhird Party Beneficiaries. Nothing contained in this Lease shall be deemed or construed to create the relationship of principal and agent, or partnership, or,joint venture. or any odnor relationship between Landlord and Tenant other than landlord and tenant. Landlord shall have no obligations hereunder to any person or entity other than Tenant or any person or entity claiming through Tenant, slit no other parties shall have any rights hereunder us against Landlord, For die avoidance of doubt, it is understood and agreed that Persons That ore Landlord Parties are intended third party beneficiaries ofand shall have the right to enforce Sections 14.1. ,1427, 14.3 and 16.2 above 17.12 Entire Agreement; rent• Amendment: Suce6mors• Survival of Obligations, This (,ease contains all of the agreements and understandings relating to the leasing ofthe Premises and the obligations of Landlurd and Tenant in connection with such leasing. Landlord has not made. and Tenant is not relying upon, any warranties, or representations, promises or statements made by Landlord or any agent of Landlord, except those expressly set reran herein. This Lease supersedes any and all prior agreements and understandings between Landlord and Tenant and alone expresses the agreement of the parties. This Lease shall not be amended, changed or modified in any way unless in writing executed by I.,andlord and Tenant. Landlord shall not have waived or released any or its rights hereunder unless in writing and executed by the Landlord. Except as expressly provided herein, this Lease and the obligations or Landlord and Tenant contained herein shall bind or inure to the benefit of Landlord and Tenant anti their respective successors and assigns, provided this clause shtdl not permit any Transfer by Tenant contrary to the provisions ol'Article IU. Any obligations or Tenor accruing prior to the expiration of this [,ease shall survive the termination of this Lease, slid 'Tenant shall promptly perform all such obligations whetherornot this Lease has expired. 17.13 Prohibition Agilinst liacord[ns. Neither this Lease nor any nnennorandum. nflidavit or other writing with respect thereto shall be recorded by Tenant or by anyone acting through, under or on behalrol'Tmnnt. 801 tPCb'ir Center Dr —City q%Senitn Ante Levee -17- 17.14 Con rid calls itv. Tenant agrees that: (a) the terms and provisions of this Lease are subject to the terms of the Cali PornIa Public Records Act and Freedom of Information Act 17,15 No Offer to Lease. The submission orthis Lease to Tenant or its Broker or other agent, does not constitute on offer to Tenant to lease the Premises. This Lease shall have no force and effect until: (a) it is executed and delivered by Tenant to Landlord, (b) It is fully reviewed and executed by Landlord and (c) all conditions to the effectiveness of this Lease are satisfied (or waived by the applicable party); provided, however, that, upon execution of this Lease by Tenant and delivery to Landlord, such execution and delivery by Tenant shall, in consideration of the time and expense incurred by Landlord in reviewing this Lease and Tenant's credit, constitute an offer by Tenant to Lease die Premises upon the leans and conditions set forth herein (which offer to Lease shall be irrevocable for twenty (20) business days following the date of delivery), 17,16 Authorit . If Tenant signs as a corporation, partnership, limited liability company or other similar entity, each of the persons executing this Lease on behalf of Tenant does hereby covenant and warrant that Tenant is a duly authorized and existing entity, that Tenant Imas and is qualified to do business in the slate of California, that Tenant has full right and authority to enter into this Lease, and that each of both of the persons signing on behalf of Tenant are authorized to do so. Upon Landlord's request, Tenant shall provide Landlord with evidence reasonably satisfactory to Landlord connnning the foregoing covenants and warranties. The person executing this Loose on behalf of Landlord hereby covenants and warrants that Landlord has full right and authority to enter into this Lease and that the person signing on behalf of Landlord is authorized to do so. 17.17 Counterparts: Facsimile Esecution, This Lease may be executed in counterparts each of which shall be deemed as an original, but all of which taken together shall constitute one and the some document. Each of the parties hereto agree that the delivery of an executed copy or counterpart of this Lease by facsimile or email shall be legal and binding and shall have the some full force and effect as if ail original executed copy or counterpart of this Lease had been delivered. /Signatures Appear on Nest Pagel 801 WCtrle Center Dr —CUB njSauet Arrrt Lease -is- IN WITNESS W IIPR107. ihiS Lease N 1101 by exc4tded as of the Effective Dale. LANDLORD: TENANT: Cl; SAKI 'ANA, LIX, THE CI.1'V OF SANTA ANA, it Delaware linlitedlin t1,= ip' aMUnle111a1empot'Jtlon. y Na. Name: Andrew Osborne Name; Cynthia J. Kurtz Title: Authorized Sign? cry Title: firWrim City. Manager By: Name: Maria 1-Iuizar ClerkortheCouncil LITectivu Date: APPROVED AS TO FORM: genie R. Carvalho, City Attorney Lisa. Storck, Asst, City Attomcy R13COM".MEND APPROVAL: A'7t , /6/71j 7 Robert M. Zur Sc W de, Interim Executive Director CAailitunty Development Agency 801 .i-9: O EXHIBIT B NOTICE OF LEASE TERM DATES To: City of Santa Ana 801 W. Civic Center, Suite 200 Santa Ana, CA 92701 Attn: Deborah Sanchez A-2017-264-02 Re: Office Lease dated October 7, 2017 (the "Lease") between CF SANTANA, LLC, a Delaware limited liability company ("Landlord"), and the City of Santa Ana, a chatter city and municipal corporation ("Tenant) concerning Suite 200 on floor 2 of the office building located at 801 West Civic Center, Santa Ana, California. Deborah Sanchez: In accordance with the Lease, we wish to advise you and/or confirm as follows: I. The Premises are substantially completed, and the Term shall commence oft or has commenced ou June 11, 2018 for a term of sixty (60) months ending on Jun 30, 2023. 2. Base Rent commenced to accrue on June 11, 2018 in the amount of $42,506.20 per month and as more particularly set forth in Irem 4 of the Basic Lease Provisions of the Lease. 3. if the Commencement Date is other than the first day of the month, the first billing will contain a pro rata adjustment. Each billing thereafter, with the exception of the final billing, shalt be for the full amount of the monthly installment as provided for in the Lease. 4, Your rent checks should be made payable to CF SANTANA, LLC, 2101 Rosecrans Avenue, Suite 3270, E1 Segundo, CA 90245 Attn: Ken Quach, Accounting Manager. 5. The Premise contains 19,321 RSF, 6. Tenant's Proportionate Sharc is 15.561%. LANDLORD: CF Santana, LLC, a.Deiawrini,,711Mr'IfabiiifV=mPa%'- Name:1tTjilS1W£jgypFyg_ Title: ALiiharized Signatory TENANT: THE CITY OF SANTA ANA, a Municipal corporation By: —r Print Name: Raul GodInez3 Title: CLtManaaer 4FW710VE1D AS TO FORM V Maria D. Hurzar ��/ 11 I 1 Clerk of the Council City Attorney EXIIIBIT "C" WORK LETTER THIS WORK LETTER (this "Work Letter") is attached as Exhibit C to that certain Office Lease (the "Lease") by and between CF SANTANA, LLC, a Delaware limited liability company ("Landlord") and THE CITY OF SANTA ANA, a Municipal corporation. ("Tenant"), This Work Letter sets thrill file terns, covenants and conditions relating to the construction and installation attic Tenant Improvements in the initial Premises. All capitalized terms used herein not otherwise defined herein shall have the meanings attributed to such terms in the Lease. 1.1 Landlord's Architect and the Engineers. Landlord shall engage (a) Fraser McLellan or another qualified interior architect selected by Landlord ("Landlord's Architect") to prepare the Construction Drawings (defined below) for the Premises based upon the Final Space Plan (defined below) and (b) engineering consultants selected by Landlord (the "Engineers") to prepare all engineering plans and drawings fertile structural, mechanical, electrical, plumbing, HVAC, life safety, and sprinkler work relating to the Tenant Improvements for the Premises. 1.2 Final Space Plan; Space Planning Allowance. A copy of the final space plan (and pricing plan) for all Tenant Improvements in the Initial Premises ("Final Space Plan") is attached hereto as Schedule Landlord Landlord shall bear all costs and expenses in connection with the preparation of the Final Space Plan ("Space Planning Costs in an amount equal to SZ898.15 (i.e., $0.15 per RSF In the Initial Remises). Any Space Planning Costs in excess of $2,898,15 shall be "Tenant improvement Costs" and shall be deducted from the Allowance Amount, 1.3 Final Working Drowtaes. Based upon the Final Space Plan, Landlord shall cause the Architect au[ the Engineers to complete and deliver to Tenant for Tenant's reasonable approval two (2) copies of complete filly coordinated architectural and (to the extent required) structural, mechanical, electrical and plumbing working drawings and specifications for the Tenant Improvements in a form which is sufficiently complete to allow all subcontractors to bid on die work shawl therein and to obtain all applicable Permits therefor, if any (defined below) (collectively, the "Final Working Drawings"). Tenant shall, within five (5) business days after Tenant receives the Final Working Drawings, either: (a) approve the Final Working Drawings, or (b) disapprove die Final Working Drawings Plan because a Design Problem exists and return tine same to Landlord showing revisions required to eliminate such Design Problem (or Design Problems), If Tenant fails to notify Landlord within five (5) business clays after its receipt of the Final Working Drawings that it approves or disapproves the Sallie, Tenant shall be deemed to have approved the Final Working Drawings. A "Design Problem" means and shall exist only if the Final Working Drawings are not consistent with the Final Space Plan. If Tenant disapproves the Final Working Drawings because they contain one or more Design Problems, then Landlord shall cause Landlord's Architect to make the requested changes thereto to the extent required to eliminate such Design Problems and shall resubmit to Tenant such revised Final Working Drawings, with the foregoing procedure to be repeated until the Final Working Drawings for the Premises are ultimately approved (or deemed approved) by Tenant (as so approved, the "Approved Working Drawings"), The Approved Working Drawings, as moditied by any Changes (defined below) approved by Landlord, and all parts or components thereof are somednnes re Feared to herein as the "Construction Drawings". 1.4 Changes in the Final Space Plan and improved Working Drawings. No Changes (defined below) may be made by Tenant without the prior written consent of Landlord (in accordance with Section 1.5.1, below); provided, however, that Landlord may withhold its consent in its sole and absolute discretion to any Change which ip Landlord's judgment are unreasonable or would directly or indirectly delay Substantial Completion (defined below). Tenant acknowledges and agrees that Tenant slid]] bear the cost of any Changes that are requested by Tenant, "Changes" means, collectively; (a) any changes, modifications or alterations in either the Final Space Plan or the Approved Working Drawings or in the Tenant Improvements Par the Premises contemplated thereby or (b) any modifications or alterations to the Final Working Drawings requested by Tenant in accordance with Section 1.3, above (or otherwise), other than any such changes, modifications or alterations that are required in order to eliminate a Design Problem. 1.5 Landlord's Review, 1.5.1 Any approval or consent of Landlord hereunder with respect to any portion or component of the Construction Drawings or the Tenant Improvements shall be granted or withheld on the basis of such standards as Landlord shall establish in good ilaith from time to time. Landlord has established (or may establish in the figure) Building Standards for tine components to be used in the construction of the Tenant Improvements in the Premises ("Building Standards"). The quality of all Tenant Improvements shall be equal to or of greater quality than the quality specillcalions of the Building Standards; provided, however that Landlord may; at Landlord's option, require the Tenant Improvements to comply with specific Building Standards. Landlord reserves the right to promulgate, establish, modify, delete from, anal make other changes to tine Building Standards I1o111 time to time. 1.5.2 Landlord's review of any matters (including, without limitation, any requested Changes), as set Ibrih in this Wok Letter, shall he solely for the p upose of protecting Landlord's interests hereunder, and shall not imply Landlord's review or the same, or obligate Landlord to review the same, Ibr quality, design, Code compliance or culler like matters, fir the boaeR of Tenant or any other party, and Landlord shall not be responsible tiv any emissions orerrors contained in any such items. SECTION 2 COST OF THE TENANT IMPROVEMENTS 2.1 Allocation of Costs• Allowance Amount; Tenant Improvement Costs. 2.1.1 Subject to the provisions of this Work letter. Landlord hereby grouts Terumt lift tile ']'count Improvement Costs (defined below) an amount (the "Allovmrce Amount") equal to $772.840.0li (i.e.. $40,00 per RS'F In the Initial Premises). Tonmat shall bear all ,s01 WCMe Cenmr Dr—Cffp li/ Sate it an Louse I Exhibit C Tenant Improvement Costs (defined below) (slid all other costs or expenses incurred by Tenant in connection with the design end construction of fhe Tenant Improvements) in excess of lice Al Iowan cc Amount ("Excess'fenant Improvement Costs") in accordance with the provisions or this Work Letter. Landlord shall have no obligation hereunder to make any payments or disbursements, or to Incur any obligation to make any payment or disbursement in twnneetion with the design and construction of the Tenant Improvements, In a total amount which exceeds the Allowance Amount. In any event, at all times Tenant shall pay and satisfy, in full on a timely basis all obligations tar payment incurred by Tenant in connection with the design and construction of the Tenant (mprovements. "Landlord's Architect" means the qualified licensed architect designated by Landlord fl•om time to time as Landlord's Architect. 2.1.2 "Tenant Improvement Costs" means the following: (i) Lite fees of the Architect and the Engineers in excess of the Space Planning Allowance; (ff) Landlord's customary supervision fee (tine "Supervision pee") in an amount equal to three percent (3%) of the total Tenant Improvement Costs (excluding the Supervision pee); (ill) all fees and costs fncurned by, and the cost of documents and materials supplied by, Landlord and Landlord's consultants (n connection with the preparation and review of the Construction Drawings; (iv) die cost of any changes or modifications for or to the Common Areas or Bose Building when such Changes are required fu connection with the Tenant Improvements (which shall include, without limitation, any modifications or alterations to the path of travel froniAo public transportation and public rights -of my, parking and restroom areas, that are required to cause the same to comply with any applicable Codes); (v) the cost of any Changes to the Construction Drawings or the Tenant Improvements required by Code; (vf) all costs of (or relating to) construction of the Tenant Improvements (without regard to the amount of the Bid Estimate or Landlord's estimate of total Tenant Improvement Costs), including, without limitation, testing and inspection costs, (rash 'removal costs, parking fees, after-hours utilities usage, and contractors' fees and general conditions; (vii) the cost of cable and other telecommunications lines installed as pat of the Tenant Improvements, but specifically excluding any costs in connection with the installation of Tenant's telephone service (which shall be separately installed by Tenant's Agents); (viii) plan check, permit fees, license fees, Title 24 fees and use taxes; and (Ix) the cost of installing Building Standard window coverings; and (x) the costs of the tenant demising walls and public corridor walls and materials to be installed on the second floor relating to the drywall and any finishes and hardware on the Premises side of such walls as designated by Landlord, 2.2 Payment of Excess Tenant Improvement Costs by Tenant. Prior to commencement of performance of the Tenant Improvements and not later than thirty (30) business days following Landlord's written request therefor, Tenant shall pay to Landlord in cash the entire Estimated Excess Tenant Improvement Cost (defined in Section 12.1 1 below), ]fat any time during die course of performance of the Tenant Improvements, Landlord in good faith determines that the Excess Tenant Improvement Costs to be incurred in connection with perfomionce of the Tenant Improvements will exceed the amotut of any amounts ("Deposits") previously deposited by Tenant with Landlord pursuant to this Section 2.2, then not later than three (3) business days following Landlord's written request therefore, Tenant shall pay to Landlord in cash the amount of such excess. Any failure by Tenant to pay to Landlord any amount required to be paid to Landlord under this Section (or under Section 2.3.2 below) within the time periods specified above shall be treated as failure to pay Rent when the sane is due under the Lease, and notwithstanding anything in this Work Letteror die Lease to the contrary, (a) Landlord shall have the right to require the Contractor (defined below) to discontinue its performance orthe Tenant Improvements until such time as Tenant complies with the requirements of this Section 2.2, (b) any delays associated with any such discontinuance shall be deemed Tenant Delays (and shall not, in any case, constitute Landlord Delays) and (e) Landlord shall not be liable to Tenant I'or any additional costs, lost profits, lost economic opportunities- or airy Rmn of consequential damage which may result from any such discoitinuance by Landlord under this Section 21. 2.3 Disbursement; Reconciliation of Costs, Landlord shall have the right to disburse the Allowance Amount together with all Deposits previously made by Tenant (collectively, file "Tenant Credit Amount") for such Tenant Improvement Costs and in such order as Landlord shall determine. Following final completion ofthe Tenant Improvements, Landlord shall reconcile (the'M Cost Reconciliation") the total Tenant Improvement Costs incurred or disbursed by Landlord hereunder with the ]'client Credit Amount. 2.3.1 If the TI Cost Reconciliation indicates that the total Tenant Improvement Costs incurred or disbursed by Landlord hereunder exceed the Tenant Credit Amount, 'Tenant shall pay in cash to Landlord. the amount of the excess within three (3) business (lays of Landlord's written request therefor. 2.3.2 If the TI Cost Reconciliation indicates that the Tenant Credit Amount exceeds tie total Tenant Improvement Costs incurred or disbursed by Landlord hereunder, then: (a) to the extent of ao-v Deposits made by Tenant, Landlord shall promptly return (o• at Landlord's election, credit against Tenant's obligations to pay Rent next cunning due) the onnount of such excess Deposits to Tenant, and (b) to tie extent that the TI Cost Reconciliation indicates that Allowance Amount exceeds the total Tenant improvement Costs incurred or disbursed by Landlord hereunder (any such excess the "Unapplied Allowance Amount"). then Tenant shall have the right, exercisable on or before the first (1") anniversary of the Commencement Date to deliver u Disbursement Request (together with all of the other items described in Section 2.3.1 above) requesting: (i) disbursement of funds from the Unapplied Allowance Amount for (a) Tenant Improvement Costs paid directly by Tenant; IN) disbursement of up to $193,210.00 (i.e.. $10. 00 per RSF in the initial Premises) iron, the Unapplied Allowance Amount for FF&E Costs (defined below) incurred by Tenant; and/or (ill) disbursement of up to 96.605.0 (i.e., $5.00 per RSF in the Initial Premises) fr'onh the Unnpplied Allowance Amount 110• Cabling & Moving Costs (defined below) incurred by Tenant; prvvided lint, for the avoidance or doubt, Landlord shall have no obligation under [his Section 2.3.2 or otherwise to: (A) disburse any amount in excess otthe Unapplied Allowance Amount, (B) disburse more than tine amount specified in clause (if) above for PF&E Costs. (C) disburse more than tile 'mount specified in clause (iii) above for Cabling and Moving Costs, (D) disburse any finds Ilona the Unapplied Allowance Amount for which Tenon first requests disbursement on or after the li sl anniversary of the Commencement Date. " FF&Ir Costs" means costs incurred by 'reliant fix furniture, fixtures and equipment and cabling fix the I'renlises. slid "Cabling & Moving Costs" means costs incurred by Tenant I'o• cabling instclled in the Premises and ur For'1'enant's move into the Premises. 2.3.3 Notwithstanding unylhing to the contrary in this Work Letter (or in any other provisions ol'this Lease). fl'the Allowance Amount exceeds the total Teumt Improvement Costs incunrod or disbursed by Landlord hereunder plus any amounts disbursed to Tenant under Section 2.12 above, Tenant shall not he milled to tiny credit against or abatement ol'Retil. 89f 41'CAvr Ceurrr Ur—Ciry•nfSanrn nun Lrnae 2 ExhibitC SECTION 3 CONSTRUCTION: DELIVERY OF PREMISES• SUBSTANTIAL COMPLETION• PUNC14 LIST ITEMS 3.1 Permits. Landlord will cause Landlord's Architect and this Engineers to submit the Approved Working Drawings to the appropriate governmental entities and otherwise apply for all applicable building and other permits and approvals (collectively, "Permits") (if any) necessary or required (in Landlord's good faith discretion) for the Contractor to commence, perform and fully complete the construction of the Tenant Improvements. Neither Landlord nor any Landlord Party shall have any obligation or liability to Tenant if any Permit (including, without limitation, any building permit, certificate of occupancy, or equivalent) is not timely orotherwise issued. 3.2 Landlord's Select ioil and Retention of the Contractot, 3.2.1 Landlord shall submit the Construction Drawings for the Premises on a fixed contract amount (or GMAX) basis to a general contractor selected by Landlord (the "Contractor"), which Contractor shall be independently retained by Landlord (pursuant to such construction contract form as Landlord shall in good faith determine) to construct the Tenant Improvements in accordance with the Construction Drawings. Landlord reserves the right to designate file subcontractor or subcontractors to perform particular trades (or components no the Tenant Improvements such as fire/life safety, HVAC, structural and electrical work. 3.2.2 Landlord reserves the absolute right, without the need for consultation with or the consent of Tenant, to terminate ilia Contractor for nonperformance (as determined in good faith by Landlord) and in such case Landlord may select another general contractor to complete the Tenant Improvements. Notwithstanding any provision of this Work Letter to the contrary, 'tenant hereby waives all claims against Landlord, and Landlord shall have no responsibility or liability to Tenant, on account of any nonperformance or any misconduct orally Contractor (or any subcontractor thereof) for any reason. 3,2.3 If the Tenant Improvements shall constitute "public works: pursuantto Labor Code § 1720.2, the following shall apply: (a) Landlord shall require the Contractor to comply with (and to cause its subcontractors to comply wide) prevailing wage requirements and be subJect to restrictions and penalties in accordance with §1770 at seq. of the Labor Code which requires prevailing wages be paid to appropriate work classifications in all bid specifications and subcontracts. (h) Landlord shall require the Contractor to furnish all subcontractors/employees a copy of the Department or Industrial Relations prevailing wage rates which Lessor will post at ilia Job site. For further information on prevailing wage: htto://www.dir cat ggv/disr/statistics research html (c) Landlord shall require the Contractor to comply with (and to cause its subcontractors to comply with) the payroll record keeping and availability requirement of § 1776 of the Labor Code. (d) Landlord shall require the Contractor to (and to cause its subcontractors to Lessor/conbroctor to) snake travel and subsistence payments to workers needed for performance of work in accordance with the Labor Code. (e) Prior to commencement of work, Landlord shall require the Contractor to contact the Division of Apprenticeship Semdads slid comply with § 1777.5, §1777.6, and § 1777.7 of the Labor Code and Applicable Regulations. 3.3 Delivery of Premises: Substantial Completion• Punch List Items. 3.3.1 Delivery of Premises. Landlord shall deliver [he Premises to 'fallout upon Substantial Completion of the Tenant Improvements. Subject to Landlord's obligations under [his Work Letter (including Landlord's obligations to perfomr (or cause to be performed) [he Landlord's Work and to construct (or cause to be consuiicted) the Tenant improvements in accordance with the Construction Drawings) and to all of Landlord's other express obligations under the Lease (including, under Section 2.1 of the Lease), Landlord shall have no duty or obligation to improve, or pay for any improvement for, the Premises or any portion thereof- and Tenant shall accept the same in its Tenant shall accept the Premises in its then existing condition on the Delivery Date, "AS -IS", "WITH ALL FAULTS". 3.3.2 Stilislantial Com iletion, For purposes of this Lease, "Substantial Completion" shall occur upon (and the Premises shall be "Subs(antially Complete" upon) the substantial completion orconstmction ofthe Tenant Improvements pursuant to the Approved Working Drawings, as evidenced by a "signor'' on the building permit card by tan inspector of the applicable governmental authority (typically the city in . which the Building is located), with the exception of any Punch List Items (defined below) and any tenant fixtures, work -stations, built-in furniture, or equipment to be installed by Tenant or under [he supervision of Contractor. 3.3.3 Unch List Items. Allen• the Substantial Completion by Landlord of the Tempt Improvements. mpresentntives of Landlord, 'tenant land the Contractor shall completely inspect [die Premises and complete a list (the "Punch List") of all Punch List hems (defined below). Authorized represcnmtivcs of Landlord. Tenant and the Contractor shall execute said Punch List to indicate their approval thereof Landlord shall cause the Contractor to complete all Punch List Items described oil the Paich List as soon as reasonably possible following the approval orsuch Punch List, As used herein, "Parch List Items" trans all items of construction which entail one or more details of construction, decoration. mechanical adjustment or installation that do not materially and adversely affect the use and occupancy of oily portion of Ore premises for the nornnal conduct of'Penn ll's business. 801 ircinie Center Dr.- Oly of.SantflAna Lease 3 13ah ill itC 3.3.4 Assienment of Warranties. Effective upon completion of the Tenant Improvements, Landlord shall assign to Tenant all warranties slid guaranties by Contractor relating to the Tenant Improvements, and Tenant shall waive (and hereby waives) all claims against Landlord relating to. or arising out of the construction of, the Tenant improvements. ECT'ION 4 TIME; DELAYS 4.1 Time. 4.1.1 Time of the Essence in This Work Letter. Unless otherwise indicated, all references herein to a "number of days" shall mean and refer to calendar days. In all instances where Tenant is required to approve or deliver an item, IF no written notice of approval is given or the item is not delivered within the stated time period, at Landlord's sole option, at the end of such period the item shall automatically be deemed approved or delivered by Tenant and the next succeeding time period shall commence. Except where specific time periods are specified herein, all references to a "reasonable period" contained in this Work Letter shall mean a reasonable amount of time to respond to the request or submission in question, taking Into consideration all of the circumstances reasonably related to the amount of time required, assuming reasonable diligence; provided, however, in no case shall such period ever be less titan five (5) business days. 4.1.2 Time Deadlines. Tenant shall use its best, good faith, efforts and all due diligence to cooperate with Landlord, Landlord's Architect and the Contractor to complete all phases of the Construction Drawings and the permitting process and to receive the Permits, and to achieve Substantial Completion as soon as possible, and, in that regard, shall meet with Landlord on a scheduled basis to be determined by Landlord. to discuss Landlord's progress in connection with the sane. 4.2 Delays. 4.2.1 Tenant Delays. A "Tenant Delay" means any delay as a direct, indirect, partial, or total result of any act or omission of Tenant or any of Tenant's Agents, including, without limitation, any of the following: (a) Tenant's failure to timely approve any matter requiring Tenant's approval hereunder; (b) any breach by Tenant of the provisions of this Work Letter or of the Lease; (a) any Changes requested by Tenant; (d) any requirement orTenant for materials, components, finishes or Improvements which are not available within a commercially reasonable period, or which are different fi-oni, or not included in, the Building Standards; (a) changes to the Base Building aid/or Building Systems required by the Final Space Plan, die Approved Working Drawings (or any Changes); (1) any unreasonable interference by Tenant or any or Tenant's Agents with the performance of the Tenant Improvements; or (g) any offer event specified in this Work Letter to be a Tenant Delay. 4.2.2 Landlord Delays, A "Landlord Delay" menns an actual delay as a result of any of the following: (a) Landlord's failure (for any reason other than a Tenant Delay or a Force Majeure Delay) to approve any matter requiring Lundlord's approval under this Work Letter within the time period therefor set forth in this Work Letter; (b) material and unreasonable interference by Landlord or of any of Landlord's employees, contractors or agents (except as otherwise allowed under this Work Letter) with'fennnt's perfounance of any of its obligations under this Work Letter; or (c) any other failure by Landlord, which pursuant to the teats of this Work Letter is deemed a Landlord Delay, Notwithstanding any provision of this Work Letter to the contrary, in the event that Tenant claims that it has suffered a Landlord Delay, Tenant shall, as a condition of the effectiveness of the claimed Landlord Delay, within three (3) days of its discovery of the claimed Landlord Delay, notify Landlord in writing of the existence ofthe claimed Landlord Delay and the probable estimated duration of such claimed Landlord Delay. 4.2.3 Force Malcom Delays. A "Force Nlajcare Delay" nicafs any: (a) actual delay attributable to any strike, lookout or other labor or industrial disturbance (whether or not on the part of the employees of either party hereto) other than any such disturbance caused by or related to Lilly default or activities of Tenant or any Tenant's Agents (if claimed by Tenant) or of Landlord or any of Landlord's agents, employees or contractors (if claimed by Landlord), (b) actual delay caused by any civil disturbance, act of the public enemy, war, terrorism, riot, sabotage, blockade, or embargo, (c) actual delay attributable to liglitning, earthquake, tire, storm, hurricane, tornado, flood, washout or explosion, or (d) actual delay caused by governmental delay ill die issuance of the Permits not due to the fault or negligence of Tenant or any Tenant's Agents (if claimed by 'tenant) or gross negligence or willful misconduct of Landlord (if claimed by Landlotd), or (a) tiny delay due to any other similar cause beyond the reasonable control of the party from whom perlbmnance is required, and beyond the reasonable control of its contractors and representatives (including, without limitation, in the case of Tenant, the Taunt's Agents). Notwithstanding any provision orthis Work Letter to the contrary, in die event that Lilly party claims that it has suffered a Force Majcnre Delay, such party shall, as a condition of• the effectiveness of such Force Majeure Delay. within three (3) clays of discovery orthe source of such delay, notify the other party berate in writing of the existence ofsuch Force Malcom Delay. the nature of the steps being taken by such party to minimize: such delay and the probable estionned duration of such Force Mo,icure Delay. SECTION S GENERAL PROVISIONS 5.1 Reoresentatiyes. 'tenant has designated DEBORAH SANCHU, ECONOMIC DEVELOPMENT SPECIALIST III as its sole representative with respect to the matters set forth in this Work Letter, who; sail father notice to Landlord, shall have full authority and responsibility to act orb behalf of dre'reliant is required in this Work Letter, Landlord has designated 'red Bischak as its sole representative with respect to the matters set forth in this Work Letter who, until further notice to Tenant. shell have Ibll authority -and responsibility to not on behalfof the Lnndlurd Lis required in this Work Lctmr 5.2 3'enant's Entry into the Premises Prior to Substantial Colpletion. Provided that Tenant and Tenant's Agents do not in crNre in any respect with Contractor's work (or performance artful Tenant Improvements) in the Building and the Premises. Landlord shall allow 'Tenant rcasonnblc aeeCSS tc the Prenhises at least thirty (30) clays prior to the Substantial Completion f'm• the purpose oI lenaft Installing over' 801 ICCirie Cenrcr lh'—Cif)• nj'Srnun: bin l easa 4 lixhlbil C standard equipment or fixtures (including Tenant's data and telephone equipment). Not less than five (5) business days prior to Tenant's entry as permitted by the terms of this Section 5.2, Tenant shall submit a schedule to Landlord and Comtmetor, for their approval, which schedule shall detail the timing and purpose of Tenant's envy and the pnrlicuIar Tenant's Agems involved, and a copy of any governmental permits and approvals required in connection therewith, Tenant shall indemnify, protect, defend and hold Landlord harmless from and against any Claims resulting in any way from any such entry. 5.3 Tenant's Aaents and Construction Matters, Tenant's Architect, the Engineers (if any) and all subconractom, laborers, naterialmen, and suppliers retained directly by Tenant (collectively, "Tenants' Agents") shall conduct their activities in and around the Premises, Building and the Project in a harmonious relationship with all other subcontractors, laborers, materialmen and suppliers at the Premises, Building and Project and, if required by Landlord, all subcontractors, laborers, materialmen, and suppliers retained directly by Tenant shall all be union labor in compliance with the. master labor agreements existing between trade unions and the Southern California Chapter of the Associated General Contractors of America. Subject to the provisions of this Work Letter, Tenant shall: (a) timely pay in full all charges of each Tenant's Agents, (b) shall, on demand from Landlord, eliminate of record and satisfy in full all mechanics liens, slop notices as similar liens or encumbrances on the Building asserted or filed by any Tenant's Agent, (a) prior to any entry into the Building by Tenant or any Tenant's Agent, evidence, in form satisfactory to Landlord, compliance in full with the insurance requirements set forth in Exhibit "C.2" attached hereto, and (d) indemnify, defend, protect and hold Landlord harmless from any Claims, Damages and Costs asserted against or Incurred by Landlord in connection with the Construction Drawings, any act or omission of any Tenant's Agent, of in connection with Tenant's non-payment of any amount arising out of the design or construction of the Tenant Improvements. Tenant shall comply in fill (and shall cause each of its Tenant's Agents to comply In full) with such construction rules and regulations as Landlord shall adopt from time to time. 5.4 Tenant's Lease Default. Notwithstanding any provision to the contrary contained in this Lease, if an Event of Default, or a default by Tenant under this Work Letter, has occurred at any time on or before the Substantial Completion, then: (a) in addition to all other rights and remedies granted to Landlord pursuant to the Lease, Landlord may cause Contractor to cease the construction of the Tenant Improvements (in which case, any delay Substantial Completion caused by such work stoppage shall be a Tenant Delay and any increased costs that result from any such work stoppage shall be Tenant Improvement Costs), and (b) all other obligations of Landlord under the terms of this Work Letter shall be suspended until such time as such default is cured pursuant to the tens of the Lease. $01 WCivtc Center Or— C/o' afSnuta Anrr Lease 5 Exhibit C • I PJ oz ca, I ,,L-L LIHIN U� 2i yj ga L il I qi- N I lI LA w �i* 4, i� tills, I I 7. SCHEDULE "C-2" INUMANCC REOUIRI%MP'NTS Guseral Coverages, All ol'Tenunt's Agents shall carry worker's compensation insurance covering all of their respective employees, and shall also carry public liability insurance, including property dontage, all with limits, In torn and with companies as are required to be carried by Tenant as set forth in Article I I of the Lease, Special Coverages. The Tenant Improvements shall be insured by Tenant pursuant to Article I I of the Lease immediately upon completion thereof. All of Tenont's Agents shall carry excess Iiabiliiy aid Products and Completed Operation Coverage insurance, each in amounts not less than $1,000,000 per incident, $2,000,000 in aggregate, primary automobile liability Insurance with limits of not less than $1,000,000 per occurrence, and workers' compensation its required by Inw, and in Ibrm and with companies as are required to be carried by Tenant as set forth in AElicle I I of the Lease. General Terms, Certificates for all insurance carried pursuant to this Schedule 16C-2" shall be delivered to Landlord before any entry into the Project by Tenant or any Tenant's Agent. All such policies of insurance must contain a provision that the company writing said policy will give Landlord thirty (30) days prior written notice of any cancellation or lapse of the effective date or any reduction in the amounts of such insurance. fit the event that the Tenant improvements are damaged by any Tenant's Agents during the course of the construction thereof, Tenant shall immediately repair the same at Tenant's sole cost and expense. Tenant's Agents shall mnintain all of the foregoing insurance coverage in force until the Tenant Improvements are fully completed and accepted by Landlord. All policies carried under this Schedule "C-2" shall insure Landlord and Tenant, as their interests may appear, as well as Contractor and Tenant's Agents. All insurance, except Workers' Compensation, maintained by Tenant's Agents shall preclude subrogation claims by the insurer against anyone insured thereunder. Such insurance shall provide that it is primary insurance as respects the Landlord and that any other insurance maintained by Landlord is excess and noncontributing with the insurance required hereunder. The requirements of the foregoing insurance shall not derogate from the provisions for indemnification of Landlord by Tenant contained in this Work Letter, 801 1VCMic Center Dr —City njSmnn rbrn Lease I Schedule C 2 EXHIBIT "D" RULES AND REGULATIONS Tenant shall faithfully observe and comply with the following Rules and Regulations (Including, but not limited to the General Rules, the Parking Rules and the Rules of the Site (Contractor's Work)). Landlord reserves the right at any time to change or rescind any one or more of these Rules and Regulations-, or to male such other and further reasonable Rules and Regulations as in Landlord'sjudgment may from time to time be necessary for the nhanagenncut, safety, care and cleanliness of the Premises and die Project, and for the preservation of good order therein, as well as for the convenience of other occupants and tenants therein. Landlord shall not be responsible to Tenant for the nonperformance of any of said Rules and Regulations by or Otherwise with respect to the acts or omissions of any other tenants or occupants of the Project. Landlord may waive any one or more of these Rules and Regulations for [lie benefit orally particular tenants, but no such waiver by Landlord shall be construed as a waiver of Bach Rules and Regulations in favor of any other tenant, nor prevent Landlord from thereafter enforcing any such Rules or Regulations against any or all tenants of the Project. Tenant shall be deemed to have read these Rules and Regulations and to have agreed to abide by them us a condition of its occupancy of the Premises. In the case orally conflict between these Rules and Regulations and the Lease, the lease shall control. I. GENERAL RULES 1. The sidewalks, driveways, entrances, passages, courts, elevators, vestibules, stairways, corridors or balls of the Project shall not be obstructed or used for any purpose other than ingress and egress. 2. No awnings or Other projection shall be attached to the outside walls ofthe Project without Landlord's prior written consent. 9. The sashes, sash doors„ skylights, windows and doors that reflect or admit light and air into the balls, passageways or other public places in [lie Project shall not be covered or obstructed, nor shall any bottles, parcels or other articles be placed on the windowsills. Neither the interior nor tie exterior or any windows shall be coated or otherwise sunscreened without landlord's prior written consent. If Tenant desires window curtains, tie same must be of such uniform shape, color, material and make as may be prescribed by Landlord. d. Without Landlord's- prior w-luen consent (in its sole rind absolute discretion), no sign, advertisement, notice or video shall be exhibited, projected, displayed, painted or affixed by Tend on any part of the Premises or Project so as to be seen from the outside of, its Premises. 1n the event of Tenant's violation or the foregoing, Landlord may remove the same without any liability and may charge lha expense incurred in such removal to Tenant. All Building standard signs whether on doors, directory tablets or elsewhere, shall be inscribed, painted or affixed tar Tenant by Landlord at die expense of Landlord, and shall be of a size, color and style acceptable to Londlord. 5, The bulletin board or directory of the Project will be provided exclusively for the display of the name and location of Tenant only; and Landlord reserves the right to exclude any other names therefrom, and each and every name in addition to the name of Tenant placed upon such bulletin board or directory, shall be subject to Landlord's prior written consent (and if approved by Landlord, all costs therefor shall be paid by tenants). Any such listings or representations, once installed, shall be subject to relocation or removal upon Lundlord's written request for any reason (except that any such relocations or removnls at Landlord's request, unless such request is based upon Tenant's breach orlhe Lease shall be paid for by Landlord), and Tenant shall pay for the removal of any such listings or representations upon its departure from its Premises. 1. All doors opening onto public corridors shall be kept closed, except when being used for ingress and egress. 7. 'Tenant shall not murk, paintr drill or bore into, cut or suing wires in, lay linoleutn or other floor coverings, in, or in any way deface nny part Orits Premises or the Project, except with Landlord's prior written consent mid as landlord may direct. 8. All keys shall be obtained from Landlord. No additional locks or bolts of any kind shall be placed upon any of the doors or windows by Tenant, nor shall any changes be made f l existing locks or the mechanisms thereof. Tenant must, upon the termination of its tenancy, give to Landlord all keys pertaining to the Premises and the Project, and in die event of die loss of any keys so furnished, "tenant shall pay Landlord the cost oflepluciog same or changing the lock or locks opened by such lost key(s) if Landlord shall deem it necessary to make such change. No window or other air conditioning Or heating units or other similar apparatus shall be installed or used by Tenant without Landlord's prior written consent 10, The water slid wash Closets nod other plumbing fixtures shall not be used for any purpose other tan Bose for which they were constructed and no sweepings, rubbish, rags or -other subsmnces shall be thrown therein. Tenant agrees to prevent the overflow or release orwale-fom bathrooms or kitchens. including but not limited to toilets, sinks, kitchen appliances, and other water receptacles. All damages resulting lion any misuse ol'the frumvs by, or overflow or release of water caused by, Tennt or its savants, cnnployees. agents. visitors or licensees shall be borne by Tenant. It. Tenant shall: (s) clean and dry visible moisture on windows, walls, and other surfaces, including personal property as soon as possible. (b) regularly clean and sanitize kitchens and other surfaces where water, moisture condensation. laid ntold can collect shall be regularly cleaned and sanitized and (c) limit the wntcring of' ally indoor plants. Temnl shall not obstruct or impede bush air supply to t'urnace, air conditioner or heater cities, or regular air Flow and circulation throughout prennfses. Tenant shall report any of the 110110cwhig to Landlord within forty-eight (48) hogs uller Tenant lirst becomes aware of the same: (f) nun -working Pon, Reuter, air conditioner or venlflatfon systems; (ill plumbing leaks. drips. sweating pipes. and/or wet spots: (iii) overflows from bathroom, kitchen, or other facilities. including 301 I f`Chic Center Dr— 00, oJ'Smati tan Lease - I - FNhibit D but not limited to, tubs, showers, shower enclosures, toilets, sinks, kitchen appliances, or other receptacles or water, especially in cases where die overflow may have permeated walls, floors, ceilings or fixtures; (iv) water intrusion into the Premises of any kind; (v) any mold ur black or brown spots or moisture on surfaces inside the Premises; (vi) broken plumbing systems or standing water near structures within die Premises; and NO any odors consistent with mold growth within the Premises. 12, All removals front' or carrying in or out of, the Project of any safes, freight, furniture, heavy or bulky matter of any description, must take place only prior to 7:00 A.M. and/or after 5:30 P.M. on days other than Saturdays, Sundays and holidays (no moving being permitted on Saturdays, Sundays or holidays without special permission) and must be made upon the previous written notice to Landlord and under the supervision of Landlord or its agent(s), and the persons employed by Tenant to perform such work must be acceptable to Landlord. Tenant shall be responsible for any damage to the Premises and Project caused by or resulting from any such activity. Landlord reserves the right to inspect all safes or other heavy or bulky equipment or articles to be brought into the Project and to exclude from the Project all such heavy or bulky equipment or articles, the weight of which may exceed the floor load for which the Project is designed, or such equipment or articles as may violate any of the provisions of the Lease. Tenant shall not use any machinery or other bulky articles in the Premises, even though its Installation may have been permitted, which may cause any noise, orjar, or tremor to die floors or walks, or which by its weight might couse injury to the floorof the Project. 13. Neither Tenant nor its servants, employees, agents, visitors or licensees shall at any time bring or keep upon the Premises any flammable, combustible or explosive fluid, chemical or substance, except for a reasonable quantity of such material reasonably necessary for the conduct orTenanl's business. 14. The Premises shall not be used for manufacturing or for the storage of merchandise except as such storage may be incidental to the Tenant's use of the Premises for the Permitted Use. Tenant shall not, without Landlord's prior written consent, occupy or permit any portion of the Premises to be occupied or used for the manufacture or sale of liquor or tobacco in any form, or as a barber or manicure shop. The Premises shall not be used for lodging or sleeping or for any immoral or illegal purposes. 15. Tenant shall not make, or permit to be made, any unseemly or disturbing noises, or disturb or interfere with occupants of the Project or neighboring buildings or premises or those having business with it by the use of any musical instrument, radio, phonographs of unusual noise, or in any other way. Neither Tenant nor its servants, employees, agents, visitors or licensees shall throw anything out of dons, windows or skylights or down passageways or common corridors. 16. No bicycles, vehicles or animals of any kind shall be brought into or kept In or about the Premises, and no cooking shall be done or permitted by in the Premises, except that the preparation of coffee, ten, hot chocolate and similar items Por Tenant, its employees and visitors shall be permitted provided such activities do not otherwise violate the Lease. Tenant shall not cause or permit any unusual or objectionable odors to be produced In or accurate , from the Premises. 17. There shall not be used in any space, or in the elevators, common corridors or public halls of die building, any hand trucks except those equipped with rubber tires and side guards, I & No vending or coin operated machines shall be placed by Tenant within the Premises without Landlord's prior written consent. 19. No person shall be employed by Tenant to do janitorial, maintenance, construction or similar work in any part of the Project without Landlord's prior written consent. Any person employed by Tenant to do janitorial, maintenance or similar work with Landlord's consent shall, while in the Project, be subject to and under the control and direction of landlord or its agent or representative (but not as an agent or servant oFLandlord) and Tenant shall be responsible for all sots of such persons. 20. Landlord shall have the right to prohibit any advertising by Tenant which, in Landlord's opinion, tends to impair the reputation of the Project or its desirability as an oPfce building, and upon written notice from Landlord, Tenant shall refrain frou or discontinue such advertising. 21, Canvassing, soliciting and peddling are not permitted in the Project, and Tenant shall cooperate to prevent same. 22. Landlord reserves the right to control access to the Project by all persons after reasonable hours of generally recognized business days and at all hours on Sundays and legal holidays. Tenant shall be responsible ror all persons for whom it requests alter -hours access, and shall lie liable to Landlord to, till acts and omissions of such persons. Landlord assumes no responsibility and shall not be liable For any damage resulting train the admission of any unauthorized person to the Project. 23. Landlord reserves the right to exclude or expel from the Project any person who, in duejudgment of Landlord, is intoxicated or under the influence of liquor ordrugs, or who shall in any manner do any act in violation of these Rules slid 12eo donors, 24, 'tenant shall not suffer or permit smoking or carrying of lighted cigars or cigarettes in areas reasonably designated by Landlord or by applicable governmental agencies as nonsmoking wens. 25, Tenant shall comply with all safety, fire proteelion and evaelratinn regulations established by Landlord or any applicable governmental agency, 20, Tenant assumes all risks turn theft or vandnlisrn and agrees to keep the Premises docked as may be required. 11, PARKING RULES. 801 II'Cirie Caner Dr— Cit.), gfSanrn.4an Lease -2- Exhibit D The following parking rules and regulations ("Parking Rules") shall be in effect at the Project. Tenant shall comply with these Parking Rules in its use (and is the use of its visitors, patrons and employees) ofthe Parking Facilities, I. Parking areas shall be used only for parking vehicles no larger than [tali size, passenger automobiles herein called "Permitted Size Vehicles." Vehicles other than permitted Size Vehicles are herein referred to as "Oversized Vehicles." 2. Tenant shall not permit or allow, ally vehicles that belong to or am controlled by 'tenant or Tenant's employees, suppliers, shippers, customers, or invitees to be loaded, unloaded, or parked in areas other than those designated by Landlord for such activities. 3. Parking stickers, access cards or identification devices shall be the properly or Landlord, and shall be returned to Landlord by the holder thereof upon tennination of the holder's parking privileges. Tenant shall pay to Landlord refundable deposits on such devices as reasonably established by Landlord from time to time. Tenant will pay such replacement charge as is reasonably established by Landlord for (he loss of such devices. 4• Landlord reserves the right to: (a) refuse the sale of monthly identification devices and/or parking access cards to any person or entity that willfully refuses to comply with the applicable rules, regulations, laws and/or agreements and/or to (b) revoke the right of any such party (that willfully refuses to comply with the applicable rules, regulations, laws and/or agreements) to use the Parking Facilities, 5. Landlord reserves the right to relocate all or a part of the parking spaces on the Project from one location on the Project to another and/or to reasonably adjacent offsite location(s), and to reasonably allocate them between compact and standard size spaces, so long as the same complies with applicable laws, ordinances and regulations. 6. Users of the parking area will obey all posted signs and park only in the areas designated for vehicle parking. 7. Unless otherwise instructed, every person using the parking arewis required to park and lock his own vehicle. Landlord will not be responsible or liable to Tenant, its visitors or employees for any damage to vehicles, injury to persons or loss of property, all of which risks are assumed by the party using the parking area, 8. Parking validation, if established, will be permissible only by such method or methods as Landlord and/or its licensee may establish at rates generally applicable, 9. The Parking Facilities shall be used only for parking Permitted Size Vehicles. The maintenance, washing, waxing or cleaning of vehicles in the parking structure or common areas of the Project is prohibited, Tenant shall have no right to install any fixtures, equipment or personal property (other than vehicles) in the Parking Facilities, nor shall Tenant make any alteration to the Parking Facilities. 10. - Tenant shall be responsible for seeing that all of its employees, agents and invitees comply with all applicable parking rules, regulations, laws and agreements (including, without limitation, these Parking Rules). 11. Such parking use as is herein provided is intended only as a license slid no bailment is intended or shall be created hereby. 12. In no event shall Tenant or its employees park in reserved spaces leased to other tenants, or in stalls within designated visitor parking zones. 13. Tenant shall, upon request of Landlord From time to time, furnish Landlord with a list of the names of its (and its Transferee's) employees and vehicle license plate numbers. 14. Persons using the Parking Facilities shall observe all directional signs and arrows and any posted speed limits. Unless otherwise posted, in no event shall the speed limit of five (5) miles per hour be exceeded. All vehicles shall be parked entirely within painted stalls, and no vehicles shall be parked in areas which are posted or marked as "no parking" or oil ramps, driveways and aisles. Only one (1) permitted Size Vehicle may be parked in a parking space. In no event shall Tenant interfere with die use and enjoyment of the Parking Facilities by other tenants of the Building or their employees or invitees. 15. Should any parking spaces or privileges be allotted by Landlord or Tenant, either an a reserved or unreserved basis, Tenant shall not assign or sublet any orthose spaces, either voluntarily or by operation of law, without the prior written consent or Landlord, except in connection with an authorized assigmnent or this Lease or subletting ordlo Premises. 16. Tenant agrees to notify its employees and visitors (anti Its Transferees) orthe requirements of these Parking Rules as the same am modified from time to time, and assumes responsibility for compliance by its employees and visitors (and its 'transferees, and their employees and visitors) with these Parking Rules as the same are modified from time to time. Tenant authorizes Landlord to tow away from the Building and/or Parking Facilities any vehicle parked in violation of these Parking Rules, anti/or to attach violation stickers or notices to those vehicles, (II, RULES OF 'I'll E SITE (CONTRA CTOR'S WORK). The following rules and regulations shall apply to tiny work perlbived at the Project by or under the direction of Tenant or any other 'reliant Party. Before commencement of any such wort:, 'Tenant shall deliver to Landlord a copy or these Rules or the Site (Conlracmr's Work) executed by the contractor(s) perf alliing such work, I. The fallowing Rules of' tile Site liw Contractor's work ("Rules of' (lie Site") shall govern the operation of Contrsetor and Contractor's subcontractors. 'rile ternis "Owner" and "Owner's Represenmtive" lire the same fir purposes ol'this document (and where used, ml'cr to the Landlord)• 801111 Civil Center Dr— City' J'Sunra Arra Lean •3• Exhibit D 2. Within a reasonable time prior to the start of any on -site work, delivery of materials, equipment, or personnel, Conti -actor will submit to Owner the following: A- A complete set of drawings approved by Owner and subsequently by the City in which the Building is located. B- A fully executed Indemnity Agreement (To Be Provided by Owner Upon Request). C- Certificate of Insurance in a form approved by Owner executed by insurance companies acceptable to Owner. D- A Rlly executed Notification -Rules for Contractors (To Be Provided by Owner Upon Request). E- A job schedule of the work to be accomplished, detailed by trade. F- A complete list of all proposed Subcontractors slid suppliers. Owner must approve all contractors and subcontractors before commencement of their work. 0- The name and phone number (including emergency phone numbers) of personnel who are authorized to represent the Contractor. 3. No revisions or changes of any kind may be made to the construction plans previously approved by Owner without prior written consent of the Owner. Any proposed revisions or changes must be submitted to Owner in the form of a change order, for Owner's review and approval prior to commencement of such changes, Revisions or changes altering the floor plan, base building systems, or building operations must be submitted, in writing, to the Owner for review and approval prior to commencement of work. 4. All of Contractor's work must be scheduled so that it in no way conflicts with, interferes with, or impedes the quiet and peaceful enjoyment of other tenants or occupants of the Project, or with the progress of Owner's woic or operations. Airy work that is in conflict will be rescheduled by the Contractor to such time as approved by Owner. Additionally, Owner shall have no liability for any costs or expenses incurred by Contractor (or Tenant) in connection with such rescheduling, S. Contractor and subcoitrilC oral shall employ persons and means for file orderly progress of the work without interruption on account of strikes, work stoppages or similar causes of delay. Additionally, Owner shall have no liability for any costs or expenses incurred by Contractor (or Tenant) in connection wilt) such delays. 6. Materials and tool storage will be limited to the areas f'or which access has been granted. 7. Clean-up and rubbish removal shall be provided by the Contractor at Contractor's expense. Contractor must, on a daily basis, remove all rubbish, surplus and waste material resulting from the performance of his work. At the request of Owner, Contractor shall relegate any materials causing an obstruction as directed by Owner. Contractor will not be allowed to place a dumpster on site on a continuous basis during construction, Important note: The placement and location of rubbish dumpsters and bins must be approved in advance by Owner. g. In general, Owner will interface with Contractor to the extent necessary for work to be completed within the guidelines of project specifications and for the enforcement of building roles and regulations. 9. Contractor will make arrangements for unloading, trash removal and hoisting after normal working hours due to die local city noise ordinance. (No such activity will be allowed between the hours of 10:00 p.m. to 7:00 a.m.) Al no time will the Contractor be given exclusive reserved use of the freight elevator unless applied for by Contractor and approved by Owner. Contractor may be afforded access to loading dock space and hoisting facilities for limited use at such time during normal working hours as is prearranged with Owner, or at other times, with the consent of Owner and upon payment orOwner's prevailing fee for after-hours use and access. 10. C'ontroclor will be afforded unloading areas us prearranged with Owner. All maferhds unloaded at these areas will be moved to an area of use Immediately and shall not be stood or used in a way which adversely impacts use ofthe Building, 11. Connector (and Tenant) will be responsible for the security of its own materials, equipment and work, and that of his subcontractors. Contractor will also be responsible for damage Caused by Contractor or its subcontractors to the Project, Building and/or tenant areas, including. but not limited to the loading dock and indoor and outdoor public areas, freight elevators, etc. Any such damages will he promptly repaired to the Owner's satisfaction at sole cost of Conm•uctor. 12. Contractor will comply with all applicable codes, laws and regulations pertaining to the Work Or Contractor, including all safely raid health regulations. The Contractor shall supply file OWnef with a Masler List or all I-Iax.ru'dous Materials and their Material Safety Date Sheets (MSDS) upon delivery to the job site. A discussion will then ensue pertaining to the safe storage, handling and use or these materials, as well as the Contractor's emergency preparedness plan I'o' handling the containment and clean-up of potenthd 140ru'dous Material spills, 13. Contractor will not engage in ally labor practice that may delay or otherwise impact die work of Owrier or any other eennactor. 14. No base building systems will be turned oil' or disengaged by Contractor er any subcontractor without prior written approval and supervision fly,' representative ofOimier or its agent, Said systems include bill are not limited to sprinklers, electrical circuits, air -handling units, smoke heads and water supply. Building electrical power shut -downs are allowed, with the prior writtai consent cr(Owner. on Satunlyvs between 10:00 p,i n. and 3:00 a.m. only. A request for apprr)vnl shall be made to the Property Manager' at least tell ( Ill) days in sdvance. ND!!V Cirir Garner l)r—C(p•rJ'Sanul our leare -4- tieltibitU 15. Doors to all work areas, Including stairwells and mechanical and electrical closets, will remain closed at all time. Propping doors open is expressly prohibited. 16. All Contractor and subcontractor personnel, materials, tools and equipment are to enter and exit the Building through the service elevator only, Owner may at any time initiate a check in/check out system, or a badge system, for all people and material in the Building and the Contractor will agree to cooperate with any such system. 17. Before ordering material or doing work which is dependent upon proper size or installation, the Contractor shall field verify all dimensions for accessibility with building conditions, and shall be responsible for saute. 18. Contractor shall not permitted Bay identifying signage or advertising within the Project or Building. 19. During construction, Contractor shall maintain supervisory personnel on the site at all times. Such personnel shall be fully authorized to coordinate, respond for and authorize Contractor's work as necessary so as to enable all work to proceed in a timely and well -ordered fashion. Should Contractor perform work which would cause or require Owner to provide personnel to be present or otherwise perform any work, Contractor shall reimburse Owner for the expense of such personnel. 20• Contractor shall be responsible for the protection of its work and the area adjacent to his work. 21. Contractor will ensure that all stairwells, mechanical rooms, electrical and telephone closets, etc, accessed by Contractor or subcontractors in conjunction with Contractor's work, will be cleaned and tree of debris nightly. 22. Public areas adjacent to premises where Contractor's work is being performed shall remain free of debris and materials at all times. 23, Contractor shall be responsible for all his actions on site as well as those of its subcontractors, and shall indemnify, defend and hold harmless the Owner mid the other Owner Patties from and against any and all claims, losses, or damages, threatened or incurred, arising from the actions or omissions of Contractor or its subcontractors. 24• If keys are required by contractors, they must be checked out from the Property Management Office. No key will be distributed If proper identification is not provided. 25. No cutting or patching of Owner's premises or installations, or those of any Building occupant, shall be permitted without the prior written consent of Owner. Request for permission to do cutting shall include explicit details and description of work and shall not under any circumstances diminish the structural integrity of tie Building or die Integrity of any of components m• systems. The work is to be done only with the explicit written permission of the Property Manager, and only on sit "Off -Hours" basis, Such work is to be done only under the direct supervision of a competent member of the Contractor staff, Any such area is to be promptly repaired and returned to a fully functioning, complete, and clean condition. 26. All work is to be done to a minimum standard of quality as required by the Base Building Drawings and Specifications (to be made available by Owner upon request). It is the responsibility of the Contractor to be filly knowledgeable of the Base Building Drawings and Specifications. 27, All Life Safety Systems for the Building are to be maintained, and all of the Tenant's work is to be properly interfaced with and connected to the Base Building systems as required by Laws, or by Building operation. All work is to be done in such a way as to protect all Base Building operations and warranties. Any required disconnection of life safety devices should be "foreseer" and tine Property Management Office must be notified at least 24 hoes in advance. Costs for false fire alarms due to contractors' or subcontractors' negligence will be billed to and paid by the Conunctor. All life -safety systems testing must he performed on an "after-hours" basis and coordinated with the Building Manager. 28, When work is performed by Contractor or subcontractor, charges will apply for additional services performed by Owner which may include, but are not necessarily limited to tie following: A - overtime or after-liours elevator usage nlllity usage fbr construction activities beyond standard power and water used in connection with general office uses extra and continuous dean -up of elevators and public spaces as required due to construction activity; Contractor to provide tie usual protection of existing improvements, and exercise care and good sense extended or after-hours use of the loading dock 29. In addition to cleaning roquiremenls described above, Contractor shall, in preparation for substantial completion or occupancy of the project by Tenant, pert'omh final cleaning orcoulructo's Work. 30, When Contractor takes over an area front the Owner, before commencing work Contractor shall ascertain that the area is in a sale and sanitary condition, and maintain the area as necessary (at its sole cost and expense) in It sale and sanitary condition and to a standard alerting all applicable laws and regulations. 31 • Owner requires Job progress meetings, -file Contractor will attend with a representative authorized to speak and act oil the Contractor's behalf. Additionally. the Contractor shall notify the Owner orscheduled job progress meetings. ,YlI/ FVCirtie Center Or—CFry nJ'Smrrn.4an Lrna'r -5- Exhibit D 32. All work or on -site activity during non -normal working hours will be coordinated in advance with Owner. 33. At no time will Contractor perform activities on the project without the proper insurance in force. 34. No radios or other audio devices are allowed. 35. Failure to perform work in a manner consistent with the above stated Rules of the Site may result in immediate work stoppage by Owner, Owner shall have no liability for any costs or expenses incurred by Contractor or any subcontractors (or Tenant) in connection with or as it result of such work stoppage. 36. The Rules of the Site may be amended or revised at any time to fit the situation at the time. The amended or revised Rules of the Site shall become effective upon delivery to Contractor or publication by posting at the project site, whichever is earlier. 37. General contractor and subcontractors' vehicles parking trust be in areas designated by the Building Manager at the Contractor's expense. Acknowledged and Agreed By, Date: 901 IVvir C'errlcr Dr—Cio• ofsanrn: Urn Lvnve _t,_ fshn,ir D EMt11BIT "E" ADDITIONAL RENT Definitions. 1.1 "Rase Year" means the calendar year specified in Item 5 I of the Basic Lease Provisions, 1.2 "Expense Year" means each calendar year in which any portion of the Term of this Lease falls, through and including the calendaryear in which the Term ofthis Lease expires. 1.3 "Property 'faxes" means all real property taxes, assessments, fees, charges, or impositions and otter similar governmental Or quasi -governmental ad valorem or other charges levied on or attributable to the Project or its ownership, operation or transfer orally and every type, kind, category or nature, whether direct at- indirect, general or special, ordinary or extraordinary and all taxes, assessments, fees, charges or similar impositions imposed in lieu or substitution (partially or totally) of the same including, without Ibnilation, all taxes, assessments, levies, charges or impositions;, (a) on any interest of Landlord or any mortgagee of Landlord in the Project, the Building, the Premises or in this Lease, or on the occupancy or use of space in the Project, the Building or the Premises; (b) (a) on any transit taxes or charges, business or license fees or taxes, annual or periodic license or use fees, park and/or school fees, ads charges, parks charges, housing fund charges; (d) imposed for street, refuse, police, sidewalks, fire protection and/or similar services and/or maintenance, whether previously provided without charge or for a different charge, whetter provided by governmental agencies or private parties, mid whether charged directly or indirectly through a funding mechanism designed to enhance or augment benefits and/or services provided by governmental or quasi -governmental agencies; (e) on any possessory taxes charged or levied in lieu of real estate taxes; and (f) any costs or expenses incurred or expended by Landlord in investigating, calculating, protesting, appealing or otherwise attempting to reduce or minimize such taxes. There shall be excluded from Property Taxes all income taxes, capital stock, inheritance, estate, gift, or any other taxes imposed upon or measured by Landlord's gross income or profits unless tie same is specifically included within the definition of Property Taxes above or otherwise shall be imposed in lieu of real estate taxes or other ad valorem taxes. 1.4 "Operating Expenses" means all costs, fees, amounts, disbursements and expenses of every kind and nature paid or incurred by or on behalf of Landlord with respect to any Expense Year in connection vdth the operation, ownership, maintenance, insurance, restoration, management, replacement or repair ofthe Project: (a) Premiums for property, casualty, liability, rent interruption, earthquake, flood or other types of insurance carried by Landlord from time to time, and any deductibles thereunder actually paid by Landlord with respect to the Project. (b) Salaries, wages and other amounts paid or payable for personnel (including, without limitation, the Project manager, superintendent, operation and maintenance staff, the Parking Facilities manager, concierge (if any) and other employees of Landlord) involved in the maintenance and operation of the Building or the Project, including contributions and premiums towards f'inge benefits, unemployment taxes and insurance, social security taxes, disability and worker's compensation insurance, pension plan contributions and similar premiums and contributions which may be levied on such salaries, wages, compensation and benefits and the total charges of any independent contractors or property managers engaged in tine operation, repair, care, maintenance and cleaning Of any portion of the Building orthe Project. (c) Cleaning expenses, including without limitation, janitorial services, window cleaning, and garbage and refuse removal. (d) Landscaping and hadscape expenses, including without limitation, irrigating, trimming, mowing, Fertilizing, seeding, and replacing plants, trees and hardscape. (a) The cost of providing fuel, gas, electricity, water, sewer, telephone, steam and other utility services. (f) The cost of maintaining, operating, restoring, renovating, managing, repairing and replacing components orequipment or machinery, including, without limitation, heating, refrigeration, ventilation, electrical, plumbing, mechanical, elevator, escalator, sprinklers, fire/life safety, security and energy management systems, including service contracts, maintenance contracts, supplies and parts with respect thereto. (g) The costs of providing access control services for, and supervision of the Projcet. (h) Rental. supplies and other costs with respect to the operation of the management office for the Building. M All cost and fees fur licenses, certificates, permits and inspections, and the cost incurred in connection with the inhplentcntetinn of n transportation system management program or simllarprogram. (I) The cost of replacement, repair, acquisition, installation and modification of: (A) carpeting and wall coverings, ceiling systems and listucs ht the Common Areas, and (titer furnishings in the Coalition Areas, (B) materials, tools, supplies and equipment purchased by Landlord which are used in the maintenance, Operation and repair of the Project, and (C) any other form of improvements, additions, repairs, or replaceincnts to the Projeet or the systems. equipment or machinery operated or used in connection with the Project; provided, however, (list with respect to the items describe([ in clauses (A), (B) and (C) above which constitute a capital Reri, addition, repair or improvement (collectively "Capital Items") under sound accoLarthm and property management principles consistently applied and detennined by Landlord. in each case the cost of such Capital pleas shall be amortized (wide interest at the Interest Rule) over the usefd life (the "Useful Life) or such Capital Item, as determined by the Landlord in neco dunce with sound accounting and property management principles consistently applied or such other period as shall be consistent Ivith Institutional Owner Practices. (k) Auurneys', acenunuuus' slid consultants' fees and expenses in connection with the management, operation, administration. maintenance and repair of the Project, including, but not limited to, such expenses that relate to seeking or obtaining reducltuns in or 801 IV CAlle Center Dr'—CRI'n/'Switu Ina Lear -I- ExhibitC refunds of Property Taxes, or components thereof, or the costs of contesting the validity of applicability of any governmental enactments whfch may affect Operating Expenses. (1) Fees for the administration and management of the Project in an amount equal to three percent (3%) of the gross revenues of the Project (which shall be grossed by Landlord up to one hundred percent (100%) occupancy on an annual basis), without regard to whether actual fees so paid are greater or less than such amount. (m) Sales, use and excise taxes on goods and services purchased by Landlord for the management, maintenance, administration or operation of the Budding or the Project, (n) Fees for local civic organizations and dues for professional trade associations. (a) Payments under any covenants, conditions and restrictions pertaining to the Project or any easement, license or operating agreement or similar instrument which affects the Project. (p) Costs and expenses of Investigating, testing, documenting, monitoring, responding to, abating and remediating Hazardous Materials, other than abatement and remediation costs with respect to Hazardous Materials actually known by Landlord (on the Effective Date) to require abatement and/or remediation under applicable Environmental Laws. (q) The costs of repairing, restoring and maintaining the Parking Facilities of the Project, including, without (imitation, fire resurfacing, restriping and cleaning of such facilities. (r) Any costs, fees, amounts, disbursements and expenses which are generally included in Operating Expenses under Institutional Owner Practices. 1.5 The following costs and expenses shall be excluded from Operating Expenses: (a) expenses relating to leasing space ill the Project (including tenant improvements, leasing and brokerage commissions and advertising expenses); (b) legal fees and disbursements incurred for collection of tenant accounts or negotiation of leases, or relating to disputes between Landlord and other tenants and occupants of the Building; (c) Capital Items unless specifically permitted by Section t A of this Exhibit "E", parts (a) through (r), inclusive; (d) Property Taxes; (e) amounts received by Landlord on account of proceeds of (nsuunce to the extent the proceeds are reimbursement for expenses which were previously included in Operating Expenses; (Q except to the extent specifically provided in Section IA of this Exhibit "E", parts (a) through (r), inclusive, depreciation or payments of principal and interest on any mortgages upon the Project; (g) payments of ground rent pursuant to any ground lease covering the Project; (h) subject to Section 2.1 Of this Exhibit "T the costs of gas, steam or other fuel; operation of elevators and security systems; heating, cooling, air conditioning and ventilating; chilled water, hot and cold domestic water, sewer and other utilities or any other service work or facility, or level or amount thereof, provided to tiny other tenant or occupant in the Project which either (a) is not required to be supplied or furnished by Landlord to ']client under the provisions of this Lease or (b) is supplied or furnished to Tenant pursuant to the terms of this Lease with separate or additional charge; (i) the cost of the Landlord's Work; and (I) any cost expressly excluded from Operating Expenses in an express provision contained in this Lease. L6 "Excess Operating Expenses" means, with respect to any Expense Year, the positive excess, if any, of Operating Expenses allocable hereunder to such Expense Year over Operating Expenses allocable hereunder, to the Base Yuar. 1.7 "Excess 1'roperty Taxes" means, with respect to any Expense Year, the positive excess, il'any, of the Property Taxes allocable hereunder to such Expense Year over the Property Taxes allocable hereunder to the Base Year. L8 •Tenant's Percentage Share" means the perwritage set forth in Item 5.2 of the Basic Lease Provisions: provided, however, that Landlord reserves the right from time to time during the Term of this Leusu to recalculate 'Tenant's Percentage Share, fit which case Tenant's Percentage Share shall be calculated by dividing the number orsquale feet (if Rentable Area in the Premises by the number ot'squam feet of Rentable Area in the Project, and expressing such quotient In the form of it percentage. Calculation ibl ctlmds and Adiustmeats. 2.1 'file variable components of Opening Expenses (-Variable Expenses") for all or any portion of ally Expense Year (including the Muse Year) during which actual occupancy of the Project is less than rare hundred percent (100%) of [lie Rentable Area of the Project shall be adjusted by Landlord: as determined in good faith by Landlord npplyine sound accounting and property management principles (and the provisions 80t tl'Ch ie Center Dr —City q/'S'auirr rl nn Lease Exhibit E of this Lease) to reflect one hundred percent (100%) occupancy of the Rentable Area of the Project during such period, if doing all at- any part of any Expense Year, including the Base Year, Landlord does not provide any particular item of benefit, work or service (the cost of which Is a Variable Expense) to portions of the Project due to the fact that such item of benefit, work or service is not required or desired by the tenant of such space, or such tenant is Itself obtaining and providing such dent of benefit, work or service, or for any other reason, then for purposes of computing Variable Expenses for such Expense Year, Operating Expenses, as apphooble, shall be increased by on amount equal to the additional Variable Expenses which would have been paid or incurred by Landlord during such period if it had famished such item of benefit, work or service to such portions of the Project. 2.2 Subject to the provisions of this Section 2 of this Ex ni i ( "E' all calculations, determinations, allocations and decisions to be made hereunder with respect to Operating Expenses and Property Tuxes shall be made in accordance with the good faith determination of Landlord applying sound accounting and property management principles consistently applied which are consistent with Institutional Owner Practices. Landlord shall have the right to equitably allocate some or oil of Operating Expenses among particular classes or groups of tenants in the Building (for example, retail tenants) to reflect Landlord's good faith determination that measurably different amounts or types of services, work or benefits associated with Operating Expenses, as applicable, are being provided to or conferred upon such classes or groups. All discounts, reimbursements, rebates, refunds, u• credits (collectively, "Reimbursements") attributable to Operating Expenses or Property Taxes received by Landlord in a particular year shall be deducted from Operating Expenses or Property Taxes, as applicable, in the year the same are received; provided, however, if such practice is consistent with Institutional Owner Practices, Landlord may treat Reimbursements generally (or under particular circumstances) on a different basis. Landlord shall have the right to exclude fPom Base Year Operating Expenses the cost of items of service, work or benefits (I) not provided following the Base Year, (it) incurred due to circumstances not applicable following the Base Year or due to market -wide labor -rate increases in Operating Expenses due to extraordinary circumstances, including, without limitation, boycotts, embargoes and strikes, end utility rate increases one to extraordinary circumstances, and (iii) amortized costs relating to capital improvements. 2.3 If any Property Tax Reduction (defined below) applies with respect to any Expense Year (other than the Base Year), then for purposes of calculation of Excess Properly Taxes for such Expense Year, Property Taxes allocable to the Base Year shall be reduced by an amount equal to the conespondi ng Base Year Tax Reduction. A "Property Tax Reductions" means, with respect to any Expense Year (other than the Base Year) the amount (if any) by which Property Taxes are reduced'as a result of any reassessment or under or as a result of application of operation of Proposition 8 or any other similar governmental act or Law. A "Base Year Tax Reduction" means, with respect any Expense Year to which a Tax Reduction applies, and with respect to any particular Property Tax Reduction, an amount equal to the Property Tax Reduction, unions, in die case of any Expense Year after the first year to which the applicable Tex Reduction applies, the cumulative amount by which Property Taxes have Increased (following the fist Expense Year to which the applicable Property Tax Reduction applied) as a result of application of the annual percentage increase (presently up to 2.0%) in Property Taxes that is allowed under Preposition 13 (o' any substitute therefor hereafter adopted). 2.4 As of the date of this Lease, Tenant pays Additional (Lent under Section 4.2 of the Lease based on die Operating Expenses and Property Taxes for the Project, if the Project at any time contains more than one building (or one or more tax parcels), Landlord shall have the right, from time to time, to equitably allocate some or all of the Operating Expenses and/or Property Taxes for the buildings comprising tie Project among the Building mid some or all of the other buildings of the Project, In such event, Landlord shall reasonably determine a method of allocating such Operating Expenses and/or Property Taxes attributable to the Building (or the tnx parcel of which die Building is located) and/or such other building(s) (or such other tax parcel(s)) of the Project to the Building (or tax parcel) and/or such other building(s) (or tax parcel(s)) and Tenant shall be responsible for paying its proportionate share of such Operating Expense and/or Property 'faxes which are allocated to the Building (or the tax parcel on which it is located). Landlord shall also have the right, from time to time, to require Tenant to pay Tenunt's Percentage Share of operating Expenses and Property Taxes based solely on the Operating Expense and Properly Taxes for the Building (aid the tax panel rah which it is located). 3. Payment Procedure; Estimates. During each Expense Year, Landlord may elect to give Tenant written notice of its estimate or any amounts payable under Section 4.2 of die Lease ("Section 4.2 Additional Rent") for that Expense Year. On or before the first day of each calendar month during such Expense Year, Teriant shall pay to Landlord one -twelfth (1/12th) of such estimated amounts; provided, however, that, not more often than quarterly, Landlord may, by written notice to Tenant, revise its estimate for such Expense Year, and all subsequent payments under this Section 3 of this Exhibit "E" by Tenant for such Expense Year shall be based upon such revised estimate. Landlord shall endeavor to deliver to Tenant within one hundred fifty (150) days after the close of each Expense Year or as soon thereafter as is practicable, a statement of that year's Property Taxes, Operating Expenses, and the amount of Section 4.2 Additional Rent for such Expense Year, as determined by Landlord (the "Landlord's Statement"), and such Landlord's Statement shall be binding upon Landlord and Tenant, except us provided in ection 4 of this Exhiblt "E". If the Landlord's Statement indicates that (or it' it is finally determined pursuant to Section 4 of this Exhibit "E" that) tie amount of Section 4.2 Additional (tent payable with respect to any Expense Year: (a) is more than the estimated payments of Section 4.2 Additional Rent made by Tenant with respect to such Expense Year, •tenant shall pay the dcticiency to Landlord upon receipt of Landlord's Statement or (b) is less than the estimated payments of Section 4.2 Additional Rent made by Tenant with respect to such Expense Year, such excess payments shall be credited against Rent next payable by Tenant under this Leese or, irLhe Term of this Lease has expired, shall be paid to Tenant). Amounts payable by Tenant as Section 4.2 Additional Rent with respect to any Expense Year that includes less than on entire calendar year shall be prorated on the basis that the number of days in such Expense Year bears to 305. 'file expiration or easy termination of this Lease shall not affect the obl igations of Landlord and 'tenant pursueit to (his Section 3 orthis Exhibit "T to be performed after such expiration or early termination. 4. Review of Landlord's Statement, Provided that Tenant is not than in defiurll with aspect to its obligations under this Lease and provided further that Tenant strictly complies with the provisions of this Section 4 of this Exhibit "B". Tenant shall have the right, at Tenant's sole cost and expense, to reasonably review Landlord's supporting books and records (tit Landlord's manager's corporate offices) for uny portion ofthe Property Taxes or Operating Expenses for a particular Expense Yeacovered by Landlord's Statement, in accordance with the procedures set forth in this Segilon 4 of this Exhibit "E". Tenant shall. within sixty (GO) days ufter any such Landlord's Statement is delivered to Tenant, deliver u wriuen notice (a "Dispute Notice") to Ltmdlord specifying the itans described in the Landlord's Statement that are claimed to be incorrect, and Tenant shall simultaneously pay to Landlord all amounts specified in the applicable Landlord's Statement (to the extent tint previously paid). The right of'fennnt under this Section of this Exhibit "E" may only be exercised once for each Expense Year covered by any Landlord's Statement, and if Tenant fails to deliver a Dispute Notice within the sixty (60) day period described above or fails to meet any of the other above conditions of exereise of such right, the right ofTenant to audit a particular Landlord's Sunenent (and all aF'fcnant's rights to stake any claim relating thereto) under this Section 4 i701 WC1vlc C'enncr Dr —City oJ'Sontn Ana Lenre -3- Exhibit E. of this Exhibit "E" shall automatically be deenied waived by Tenant. Any review of records tinder this Section 4 of this Exhibit °E" shall be at the sole expense of Tenant, shall be conducted by independent certified public accountants of national standing which are not compensated on a contingency fee or similar basis relating to the results of such audit and shall be completed within sixty (60) days after Landlord provides Tenant with access to Landlord's supporting books and records. Tenant acknowledges and agrees that any records or Landlord reviewed under this Section 4 of this Exhibit "E" (and the information contained therein) constitute confidential information of Landlord, which shall not be disclosed other than to Tenant's accountants performing the review and principals of Tenant who receive the results of the review. If Landlord disagrees with Tenant's contention that an error exists with respect to the Landlord's Statement In dispute, Landlord shall have the right to cause another review or that portion of Landlord's Statement to be made by a firm or Independent certified public accountants of national standing selected by Landlord ("Landlord's Accountant"), In the event of a disagreement between the two accounting firms, the review of Landlord's Accountant shall be deemed to be correct and shall be conclusively binding on both Landlord and Tenant. In the event that it is finally determined pursuant to this Section 4 of this Exhi 't "E" that a particular Landlord's Statement overstated Operating Expenses and Property Taxes with respect to the applicable Expense Year by more than ten percent (10%), Landlord shall refnibmse Tenant for the reasonable cost orTenanl's accountmil. in all other cases. Tenant shall be liable for Landlord's Accountant's actual fees and expenses. 8lll III Cinir Gaoler Ur—Cip'r!(Smrrn Aon Lease -4' f xh ibir I. EXIIIBIT "F" SERVICES AND UTILITIES The services and utilities to be provided by Landlord rat as follows: Elevator Service, Non-attanded automatic elevator service. 2 HVAC. Subject to all governmental Laws, rules, regulations and guidelines applicable therein, HVAC to the Premises during Business Hours (defined below), which in Landlord's good faith judgment, is required for the conntbrtable use and occupancy of the Premises for general office use. After Hours HVAC (defined below) may be provided to the Premises upon request by Tenant. 'tenant shall pay to Landlord the After Hours I-IVAC Rate (defined below) for all After Hours FIVAC that is so requested by Tenant within ten (10) days of receipt of Landlord's reasonably detailed bill therelbr. Tenant shall be responsible for and shall pay to Landlord any additional costs incurred by Landlord because of the failure of the IiVAC system to perform its function due to: (a) arrangement of partitioning in the Premises or changes or alterations thereto, (b) any use by Tenant in any portion of the Ptemisos of heal -generating machinery or equipment other (hurt normal office equipment, or (c) any occupancy of any portion of the Premises at densities above customary general office levels. "Business Hours" means 6:00 AM. to 6:00 P.M. Monday through Friday, and upon Tenant's request, 9:00 AM. to 1:00 P.M. on Saturdays, in all cases excluding the date of observation of any Holiday (defined below). "Holiday" means each of New Year's Day, Independence Day, Labor Day, Memorial Day, Thanksgiving Day, and Christmas Day, and at Landlord's discretion, any other state or nationally recognized holiday that is selected by Landlord acting consistently with Institutional Owner Practices. "After Hours HVAC" means any HVAC that is provided to all or any portion of the Premises at the request of Tenant outside of Business Hours. The "After Hours HVAC Rate" means the Landlord's prevailing charges for supplying After Hours HVAC to the Premises, which as of the Effective Date is $65.00 per zone (or partial zone), per hour (or partial hour), subject to a two (2) hour minimum. Electrielty. 3.1 At all reasonable times, electric current as required for Building Standard lighting and firactional homepower office machines and adequate electrical facilities for connection to the lighting fixtures and Incidental use equipment of Tenant; provided that Tenant shall be responsible For distribution of electrical power from the electrical panels located on the floor(s) of the building on which the Premises is located. Subject to Section 3.3 of this Exhibit "F": (a) the electricity so htrnished fur Tenant's Incidental use equipment to be at a nominal one hundred twenty (120) volts and with no electrical circuit for the supply of such equipment to require a current capacity exceeding twenty (20) amperes and (b) the electricity so furnished for Tenant's lighting to be at a nominal one hundred twenty (120) volts and with no electrical circuit for the supply of such lightingto require a current capacity exceeding twenty (20) amperes, 3.2 Notwithstanding any provision of this Lease to the contrary: (a) Tenant covenants that its use of electric current shall never exceed the capacity of the feeders, risers or electrical installations of the Building or the Project, (b) the total connected electrical load for Tenant's incidental use equipment within the Premises shall in no case exceed Landlord's per usable square Foot standard, and (c) the total connected electrical load for Tenant's lighting fixtures within the Premises shall in no case exceed Landlord's per usable square fool standard, In addition, if Tenant's actual consumption of electrical power in the Premises, as determined in good faith by Landlord pursuant to such measurement method or methods as Landlord shall employ from lime to time (including, without Ii0nitation, the use ofsubmete's and/or pulse meters, electrical surveys and/or engineer's estimates) exceeds the Electrical Power Consumption'Hieshold (defined below), Tenon shall pay to Landlord, as Additional Rent in addition to those costs otherwise payable by Tenant pursuant to Article 4 the sure of. (i) Landlord's actual direct and indirect costs of supplying such excess consumption, including, without limitation, all taxes thereon, and the cost of additional warn on Building Systems resulting from such excess consumption, (ii) all of Landlord's costs of monitoring and measuring such excess consumption and (ifi) Landlord's reasonable administration fee thereon. The "Electrical Power Consumption Threshold" means, for any reasonable calculation period determined by Landlord, the Landlord's nondiscriminatory, per usable squae foot standard for electrical consumption (which is intended to represent the average rate of consumption (a kW per usable square Foot basis) during Business Hours, of an average general office tenant orthe Building). 3.3 Without Landlord's consent, Tenant shall not install, or permit the installation, in the Premises of any lighting, computers, word processors, electronic dam processing equipment or other type of equipment or machines which (a) will require a voltage other than a nominal 120 volts or require a current capacity exceeding twenty (20) amperes or (b) will increase Tenant's use of electric current in excess of that which Landlord is obligated to provide pursuant to this Section 3 orthis Exhibit "F" ("Excess Electrical Requirements"), If Tenant shall require or utilize Excess Electrical Requirements or electric current which may disrupt the provision of electrical service to otter tenons in the Building or the Project, Landlord, at its election: (i) may refuse to grant its consent or (ii) may condition its consent upon Tenant's payment in advance of Landlord's total direct anti indirect cost (including, without limitation, a reasonable adntinisontiolt fen) of designing, installing, maintaining and providing any additional facilities determined by Landlord to be required to satisfy such Excess Electrical Requirements (or otherwise related to the additional wear on Building Systems associated therewith). If Tenant's increased electrical requirements will materially affect the temperature level in the Premises or in the Building, Landlord's consent may be conditioned upon Tenants payment of all direct and indirect costs of inamllaJan and operation urany nmchincry or equipment necessary to restore the temperature level to that otherwise required n) be provided by Landlord, including, but not limited to. the cost of modifications (a the Building Systems and increased went- and tear on existing IIVAC equipment. Landlod shall not, in oily, way, be liable or responsible to 'Tenant for any loss or damage or expense which Tenant ran) Incur ur sustain it. for any reasons beyond Landlord's reasonable control, either the quantity ar character of electric service is changed or is no longer available or suitable for Tenant's requirements, \Pater, City water for drinking and rest roam purposes. 5 - ,ianitarial Service, Janitorial and cleaning services, live (5) Clays per week (excepting Holidays). conforming to tine Project standards in effect front time to time: provided that Landlord shall have no obligation to provide such services to any portions orthe Premises that are not used exclusively for general office purposes. In all events, Tenant shall pay to Landlord the cost orremnval orTenanCs refuse and rubbish, to the extent that the same exceeds the refuse and rubbish attendant to normal office usage :red/ur to the extent than "rennnt fails to keep the Premises in reasonable order. 8011 RCAde Center Dr —Cie, of Si mil; I ma Lease • I. Exhibit F Any amounts which Tenant Is required to pay to Landlord pursuant to this Exhibit'? (end/or for any services provided to Tenant in addition to those Landlord is required to provide under this Exhibit •`F" without additional charge) shell be payable upon demand by Landlord and shall constitute Additional Rent. From time to time during the Term. L.undlord shall have the right to modify the services provided to Tenant hereunder; provided that the services provided, as so modified, are consistent with Ins LiLutlomd Owner Practices. Tenant recognizes that any access control services provided by Landlord tit the Project are far the protection of Landlord's properly, and under no circumstances shall Landlord be responsible for (and Tenant waives any rights with respect to) providing security or other protection for Tenant or its employees, invitees or property in Or about the Premises, or the Project. Landlord makes no representation with respect to the adequacy or fitness of the Project's HVAC system to maintain temperatures that may be required for operation of any computer, data processing or other special equipment or occupancy of the Premises at densities above customary general office levels. 801 WClvrr Center Or—Clrp gfSanlrrAnrn l euce •?. Exhibit F EXHIBIT "G" INSURANCE REQUIREMENTS Politic 1.1 Property Insurance. At all times during the Term of this Lease, Tenant shall procure and maintain, at its sole expense, "All - Risk" (and at Landlord's option earthquake, earthquake sprinkler leakage and/or Flood) property insurance, in an amount not less than one hundred percent (1000/.) of replacement cost covering: (a) all Leasehold Improvements (b) all floor and wall coverings; and (c) all Tenant's Personal Property in or about the Premises and Project. The proceeds of such insurance shall be used for the repair and replacement of the properly so insured, except that if not so applied or if this Lease is terminated following a casualty, the proceeds applicable to the Leasehold Improvements shall be paid to Landlord and the proceeds npplicable to'renant's Personal Property shall be paid to Tenant. 1.2 Business Interruption Insurance. At all times during the Tenn or this Lease, Tenant shall procure and maintain business Interruption insurance in such amount as will reimburse Tenant for direct or indirect loss of earnings attributable to all perils insured against in Section 1.1 orthls Exhibit "0" for a period of not less than twelve (12) months. 1.3 Liability Insurance. 1.3.1 At all times during the Term of this Lease, Tenant shall procure and maintain, at its sole expense for the protection of Landlord and Tenant, commercial general liability insurance applying to the use and occupancy or the Premises and the business operated by Tenum. Such insurance shall have a minimum combined single limit of liability of at least $2,000,000 per occurrence and a general aggregate limit of at least $3,000,000, and Tenant shall provide in addition excess liability insurance on a following form basis, with overall limits of at least $5,000,000. All such policies shall be written to apply to all bodily injury (including death), property damage and personal injury losses, shall include blanket contractual liability, broad form property damage, independent contractor's coverage, completed operations, products liability, cross liability and severance of interest clauses, and shall be endorsed to include Landlord and the Landlord's Additional Insureds as additional insureds. 1.3.2 At all times during the Term of this Lease, Tenant shall procure and maintain, at Its sole expense for the protection of Landlord and Tenant, primary automobile liability insurance with limits of not less than $1,000,000 per occurrence covering owned, hired and non. owned vehicles used by Tenant. 1.3.3 Prior to the sale, storage, use or giving away of alcoholic beverages on or from the Premises by Tenant or another person, Tenant, at its own expense, shall obtain a policy or policies of insurance issued by a responsible insurance company and in a form acceptable to Landlord saving harmless and protecting Landlord and the Premises against any and oil damages, claims, liens, judgments, expenses and costs, Including actual attorneys' fees, arising under any present or future law, statute, or ordinance of the State of California or other governments[ authority having jurisdiction of the Premises, by reason of any storage, sale, use or giving away of alcoholic beverages on or from the Premises, .Such policy or policies of insurance shall have a minimum combined single limit of $3,000,000 per occurrence and shall apply to bodily injury, fatal or nonfatal; injury to means of support; and injury to property of any person, Such policy or policies of insurance shell name the Landlord and Its .agents, beneficiaries, partners, employees and any Holderof any Security Instrument designated by Landlord as additional insureds. 1,4 Workers' Compensation:. Employer's Liability Insurance. Worker's Compensation Insurance. In accordance with the provisions of Section 3700 of the Labor Code, Tenant, if Tenant has oily employees, is required to be insured against liability for worker's compensation or to undertake self-insurance. Prior m commencing the performance tribe work under this Agreement, Tenant agrees to obtain and maintain any employer's liability insurance with limits not less than $1,000,000 per accident. 2. Policy Requirements. All insurance required to be maintained by Tenant shall be issued by insurance companies authorized to do insurance business in the State of Calitornia and rated not less than A:X in Best's Insurance Guide. All such insurance policies shall be written as primary policies, not excess or contributing with or secondary to any other insurance as may be available to Landlord or to the additional Insureds. A cerf licate of insurance (or, at Landlord's option, copies orthe applicable policies) evidencing die insurance required tinder this Exhibit "G" shall be delivered to L.ondlord not less than thirty (30) days prior to the Commencement Date. No such policy shall he subject to cancellation or modification without thirty (30) days prior written notice to Landlord and to any Bolder of any Security Instrument designated by Landlord laid such policy shall be endorsed to provide that the insurer thereunder shall provide Landlord with written notice orally failure by Tenant to pay any premium thereunder when due and such failure continues fter a period or ten (10) days after such date. Tenant shall furnish Landlord with a replacement certificate with respect to any insurance not less than thirty (30) days prior to the expiration of the current policy. Tenant shall have the right to provide the insurance required by this Exhibit "0'. pursuant to blanket policies, but only if such blanket policies expressly provide coverage to the Premises and the Landlord as required by this Terse without regard to claims made under such policies with respect to other persons. 3. Miscellaneous. Tenant shall not keep, use, sell or offer for sale in or upon the Premises any article which may be prohibited by ally insaranee policy periodically in force covering the Premises, the Building or the Project. Irany of Landlord's insurance policies shall be cancelled or cancellation shall be threatened or, the coverage thereunder reduced o, threatened to be reduced in any tvay because ofthe use orthc Premises or Oily part thereof by Tenmtt or any assignee. sublenant, licensee or invitee of Tenant and, if "tenant rails to remedy the condition giving rise to such cancellation, threatened cancellation. reduction orcoverage, or threatened reduction of eoveruge, within 48 hours after notice thereof. Landlord may. at its option, either terminate this Lease or enter upon the Premises and attempt to remedy such condition. and 'Tenant shall promptly pay the cost thereof It Landlord as Additional Rent. I Landlord is unable. or elects not to remedy such condition, then Landlord shall have all of the remedies provided fur in this Lease upon the occurrence ornn Event of Dellutt. Tenant shall not do or permit to the done any act or things upon or about the Premises or the Project, which will; (a) result in the assertion of any clefensc by the insurer to any claim under, (b) involidote or (e) be in conflict with. the insurance policies of 1-andlurd ur Tenant envaring the Building. the Premises or fixtures and property therein.. or which lvould increase the rate orfre insurance applicable to the Building mV ti1C Project to an Oruuunt higher than it otherwise would be; and Tenant shall neither do nor permit to be done any act or thing upon or about the 1'renlis01 or the Building which shall or might subject Landlord lu any liability or responsibility for rotor)to any person or Bensons or to property. II� as a result orany act or omission by or on the part of Tenant or violation of this Lease. whether or Sol ['Chic Center Dr— C(pi nfSmmA,.. Leave I. Exhibit not Landlord has consented to die same, the rate of "All Risk" or other type of Insurance maintained by Landlord on or with respect to the Building and fixtures and property therein, shall be increased to an amount higher than it otherwlse would be, Tenant shall reimburse Landlord for all Increases or Landlord's insurance premiums so caused within ten (10) days after delivery orwritten demand therefor by Landlord. In any action at - proceeding wherein Landlord and Tenant are parties, a schedule or "make-up" of rates for the Project or the Premises issued by the body making fire insurance rates or established by insurance carrier providing coverage for the Building or demised premises shell be presumptive evidence of the Facts stated therein including the items and charges taken into consideration in fixing the "All Risl<' insurance rate (lien applicable to the Building or the premises. 801 IYOrle Cower Dr—Clp, nJ'Smt,, bin Lean -2- ExhibitG EXHIBIT "Id" REMEDIES Remedies for Events of Default 1.1. Landlord's Right To Terminate Unon Tenant Default. In the event crony Event of Default by Tenant as provided in Section ill of the Lease, Landlord shall have the right to terminate this Lease and recover possession of the Premises by giving written notice to Tenant of Landlord's election to terminate this Lease, in which event Landlord shall be entitled to receive from Tenant: (a) Cie worth at the time of award or any unpaid Rent which had been earned at the time crouch termination; plus (b) the worth at the time of award of die amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such rental loss Tenant proves could have been reasonably avoided; plus (c) the worth at the time of award of die amount by which the unpaid Rent for die balance of the Term after the time or award exceeds die amount of such rental loss that Tenant proves could be reasonably avoided; plus (d) any other amount necessary to compensate Landlord for all the detriment proximately caused by 'Tenant's failure to perform its obligations under this Lease or which in the ordinary cause of things would be likely to result therefrom; and (e) at Landlord's election, such other amounts in addition to at, in lieu of the foregoing as may be permitted from time to time by applicable law. As used in clauses (a) and (b) above, "worth at the time of award" shall be computed by allowing interest at die then highest lawftil contract rate of interest. As used in clause (c) above, "worth at the time of award" shall be computed by discounting such amount at the Interest Rate. 1.2 Landlord's Ripht To Continue Lease Upon Tenant Default. In die event of an Event of Default of this Lease and abandonment of the Premises by Tenant, if Landlord does not elect to terminate this Lease as provided in Section 1.1 of this Exhibit "It", Landlord may from time to time, without terminating this Lease, enforce all of its rights and remedies under this Lease. Without limiting the foregoing, Landlord has the remedy described in California Civil Code Section 1951.4 (Landlord may continue this Lease in effect after Tenant's breach and abandonment and recover Rent as it becomes due, ifTenant has the right to sublet or assign, subject only to reasonable limitations). 1.3 Right of Landlord to Perform. All covenants and agreements to be performed by Tenant under this Lease shall be performed by Tenant at Tenant's sole cost and expense. If Tenant shall fail to pay any sum of money, other than Base Rent, required to be paid by it hereunder or shall fail to perform any other act on its part to be performed hereunder, then, in addition to and without prejudice to any other fight or remedy of Landlord, Landlord may cure the same at the expense of Tenant: (a) immediately and without notice in the case: (1) of emergency, (it) where such default unreasonably interferes with any other tenant in the Project, (iv) a failure to satisfy or otherwise discharge any Encumbrance, (iv) where such default will result in the violation of Law or the cancellation of any insurance policy maintained by Landlord, or (v) any failure of Tenant to perform any of its obligations under Section 3,33 and Section 10.5 of this Lease above and (ii) in any other case if such default continues for ten (10) days from die receipt by 'tenant of notice of such default txim Landlord. Any sons so paid by Landlord and all incidental costs plus Landlord's reasonable adminis inlion fee thereon, together with interest thereon at the Default Rate from the date of such payment, shall be payable to Landlord as Additional Rent on demand, and Landlord shall have the same rights nil remedies in die event of nonpayment as in the case ordefault by Tenant in the payment of Rent. This Section 1.3 of this Exhibit "H" shall survive the expiration or termination of this Lease. 1.4 Late Pnvment. If two (2) or more Rent Delinquencies shall occur in any twelve (12) month period, Landlord may, without prejudice to any other rights or remedies available to it, upon written notice to Tenant: (a) require all remaining monthly installments of Rent to be paid twee (3) months in advance and/or (b) require Tenant to increase the Security Deposit (if any) by an amount equal to one month's Rent. 1.5. Subleases of'renant. Whether or not Landlord elects to terminate this Lease on account of an Event of Default, Landlord shall have the right to either: (a) terminate any and all subleases, licenses, concessions or other consensual arrangements entered into by Tenant that affect the Premises or (b) in its sole discretion, elect to succeed to Tenant's interest in such subleases, licenses, concessions or arrvigemenls (in which case, as of the date of such election, Twitint shall have no further right to or interest in the rent or other consideration receivable thereunder). 2. Efforts to Refet. No re-entry or taking orpossession of the Premises by Landlord following an Event of Default shall be construed as rot election to terminate this Lease unless a written notice Crouch election shall be given to Tenant or unless lire termination thereof be decreed by a court of competent jurisdiction, and Tenant's right to possession shall not be deemed to have been terminated by efforts of Landlord to relet die Premises, by its acts of maintenance or preservation with respect to the Premises, or by appointment or a receiver to protect Landlord's interests under the Lease. The foregoing enumeration is not exhaustive, but merely illustrative of acts which may be performed by Landlord without terminating Tenant's right to possession. Notwithstanding any reletling of die Premises following any Event of Derain[ without termination of this Lease by Landlord, Landlord may, at any time after such reletling, elect to rerminote this Lease for any Event or Default. To the tallest extent permitted by Lmv, the proceeds of any reletling of the Premises shall be applied: (a) first, to pay to Landlord all costs and expenses crouch releuing (including, without limitation, costs and expenses of retaking or repossessing the Premises, removing persons and property therefrom, securing new tenants, Including expenses for redecoration, alterations and other costs in connection with preparing the Premises for the new tenant, and it Landlord shall maintain and operate the Premises, the costs thereof) and receivers' fees incurred in connection with the appointment ofand performance by a receiver to protect the Promises and Landlord's interest under (his Lease and any necessary or reasonable alterations; (b) second, to the payment of any indebtedness of Tenant to Landlord other thin Rent due and unpaid hereundcr: (c) third, to the payment of Rent due and unpaid hereunder; and (d) the residue, irony, shall be held by Landlord and applied in payment of other or fume obligations ofTenant to Landlord asthe same may become due and payable, and Tenant Shull not be entitled to receive any portion of such revenue. This Section 3 or this Exhibit "id" shall survive the expiration or termination ol'this Lease. 3. Cumulative Remedies. The Specific remedies to which Landlord may resort ❑nder the terms or this Lease are cumulative and are not intended to be exclusive of any other remedies or means of redress to which it may be lawfully entitled in ease of any breach or dmealened breach by Tenant of any provisions ordiis Lease. In addition to the odwr remedies provided in this Lease, Landlord shall be entitled to u restraint by injunction of (hc violation or attempted or (hreatened violation nl'any ordic covenants. conditions or provisions of this (,.ease or to a decree compelling specific performance of any such covenants. conditions or provisions. In addition, upon the occurrence or an Event of Default by Tenant, if the Premises or any portion thereof are sublet, Lundlcrd. in addition and without prejudice to any ulher remedies herein provided or provided by Low, may, at its Null IV Chic Center Dr—C'io- oJ:Sruuo Ann Lnnse -1- Exhibit I I Option, collect directly from the sublessee all rentals becoming due to the Tenant and apply such rentals against other sums due hetunder to Landlord. 4. Waiver of Riaht of Redemption. Tenant hereby wolves for Tenant and for all those claiming under Tenant all right now or hereafter existing to redeem by order or judgment of any court or by any legal process or writ, Tenant's right of occupancy of the Premises alter any termination of Lhis Lease. Notwithstanding tiny provision of this Lease to the contrary, the expiration or termination of this Lease and/or the termination orTenant's rights to possession of the Premises shall not discharge, relieve or release Tenant from any obligation or liability whatsoever under any indemnity provision of dtis Lease, including without I imitation the provisions of Section 14,1 o f the Lease. 01 IV Civic Cenfvr Dr— Ciq' of SonfaAmi Leary .2. fshibit 11 EXHIBIT "I" FORM OF TENANT ESTOPPEL CERTIFICATE The undersigned as Tenant under that certain Office Lease dated , 20_ (the "Lease") between CP SANTANA, LLC, a Delaware limited liability company, as landlord, and the undersigned, as tenant, for Premises on the— Boor of the Office Building located at 801 West Civic Center Drive, Santa Ana, California certifies as follows: I. True, correct and complete copies of the Lease and all amendments, modifications and supplements thereto are attached hereto and the Lease, as so amended, modified and supplemented, is in full force and effect, and represents the entire agreement between Tenant and Landlord with respect to the Premises and the Properly. There are no amendments, modifcations or supplements to the Lease, whether oral or written, except as follows (include the date of such amendment, modification or 2, The undersigned has commenced occupancy of the Premises described in the Lease, currently occupies the Premises, and the Commencement Date of the Lease occurred on .20_. 31 Tenant has not transferred, assigned, or sublet any portion of the Premises nor entered into any license or concession agreements with respect thereto except as follows: 4. Base Rent became payable on 5. In accordance with the Lease, Rent commenced to accrue on , 20_. 6. The Term of the Lease expires on 7. The Lease provides for on option to extend the term of the Lease for _ years. The rental rate for such extension term is as follows: . Except as expressly provided in the Lease, and other documents attached hereto, Tenant does not have any right or option to renew or extend the term of the Lease, to lease other space at the Property, nor any preferential right to purchase all or any part of die Premises or the Property. 8, All conditions of the Lease to be performed by Landlord necessary to the enforceability of the Lease have been satisfied and Landlord is not in defhult thereunder. All space and improvements leased by 'Tenant have been completed and famished in accordance with the provisions of the Lease, and Tenant has accepted and taken possession of the Premises. 9. There are no offsets or credits against rentals payable under the lease and no free periods or rental concessions have been granted to Tenant, except as follows: 10. All monthly installments of Base Rent, all Additional Rent and all monthly installments of estimated Additional Rent have been paid when due through . The current monthly installment of Base Rent is S The undersigned acknowledges that this Estoppel Certificate may be delivered to Landlord's prospective mortgagee, or a prospective purchaser, and acknnowledges that it recognizes that if same is dote, said mortgagee, prospective mortgagee, or prospective purchaser will he relying upon the statements contained herein in making the loan or acquiring the property of which the Premises are a part, and in accepting an assignment of the Lease as collateral security, and that receipt by it of this certificate is a condition or making of the loan or acquisition of such property. Each individual executing this Estoppel Certificate on behalf of Tenant hereby represents and warrants that Tenant is a duly formed and existing entity, qualified to do business in California and that Tenant ins full right and authority to execute and deliver this Estoppel Certificate and that each person signing on behalrof'renant is authorized to do so. Executed at — un the _ day of , 20_. "Tenant": By: Name: Its: 801 WOVe Center Dr— On' 0j'SnahlAwr Lease -i- Exhibit 1 EXHIBIT "J" oPTIONS This ExI init "T consists of the following Schedules: Schedule "W" (Extension Option[s]); Schedule 1.2" (Additional Space Opdon[s]); and Schedule `J-3" (Determination or FMRR), all orwhieh are incorporated herein by this reference. Notwithstanding anything to the contrary in this Lease; (a) all of the rights and options of Tenant that are described in this Exhibit "J" (collectively, the "Options") are and shall be personal to the Original Tenant, are not transferable and may only be exercised by the Original Tenant (and not by any assignee, sublessee or other Transferee or Tenant's interest in this Lease). and (b) the Extension Option and Right of First Offer may be exercised only on the condition that, at the applicable time, the Original Tenant then occupies the entire Premises. In addition, notwithstanding anything to the contrary in this Lease, at the election of Landlord (in its sole and absolute discretion): (i) any attempted exercise by Tenant of the Extension Option or Right of First OtFer shall be invalid and ineffective if, as of the date of such attempted exercise: (A) Tenant is in default under this Lease or (B) Tenant has previously been in default under this Lease more than two times, and (ii) if as of the date that the Extension Option or Tenant's lease of any Leased First Right Space (defined below) would otherwise commence; (A) Tenant is in default under this Lease or (B) Tenant has previously been in default under this Lease more than two times, Landlord may cancel Tenant's exercise of the Extension Option or the Right of First Offer with respect to the applicable Offered First Right Space, as applicable, by delivery of written notice to Tenant. 801 If 'Chic C¢mer Dr— (10, of Santa. -Ina Leave -I - Exhibit .I Schedule "J-1" Extension Options I. Grant of Option. Subject to all of the terms and conditions of this Schedule "J-P In connection with Tenant's lease of the Premises, Tenant slmll have two (2) options (each an "Extension Option") to extend the term of this Lease as to the entire Premises then subject to tins Lease, each for on additional term (each "Extension Term") of sixty (60) months, subject to and upon the tennis and conditions contained in this Schedule "1_I ". The Extension Term shall commence upon the day immediately following the then scheduled Expiration Date, and shell be open the same teams and conditions as art provided for in this Lease, as then nmended, except that: (a) if Tenant fails to timely exercise the Extension Option, the Extension Option (and any other rights to extend or renew the Tenn) shall lapse and Tenant shall hove no further right to extend the Term of tha Lease, (b) there shall be no further options to extend the Term pursuant to this Schedule "1-I" or otherwise following the second (2"a) Extension Tenn, (c) Tenant shall not be entitled to any credit against Rent or spy other rent concession or rent allowance or abatement of Rent, except as specifically provided in the dermillon of the FMRR, (d) the Base Rent for Ore Extension Term shall be as provided in Section 3 orthis Schedule "J- Ilf, and (e) the Base Year for the Extension Tenn shall be the calendar year in which die Extension Term commences. 2 Cxerekse. An Extension Option maybe exercised only by Tenant giving written notice of exercise (an "Extension Notice") to Landlord on or befbre the date that is not more than twelve (12) and not less than nine (9) months prior to the then scheduled Expiration Date. If Tenant does not deliver an Extension Notice to Landlord within the time period set forth above (time being of the essence), then Tenant shall be deemed to have forever waived and relinquished the Extension Option, and any other options or rights to renew or extend the Term effective after the then Expiration Date she]I terminate, 3 Annual Base Ron. The Base Rent payable Far the Premises during an Extension Tenn (the "Extension Term Base Rent") shall be equal to (a) the Rentable Area of the Premises then subject to this Lease, multiplied by (b) the FMRR of the Premises as of the first day (an "Adjustment _A Date") ofsuch Extension Term, and shall be determined as follows. 3.1 if Tenant duly exercises the Extension Option, Landlord shall within thirty (30) days thereafter, deliver to Tenant a written notice (a "Market Rent Notice") of Landlord's determination of what Landlord then believes the FMRR (and Extension Terns Base Rent) would be for the Premises during die Extension Term. 3.2 Within ten (10) days after Tenant's receipt of a Market Rent Notice, Tenant shall deliver to Landlord written notice (a "Market Nett Response Notice") electing either: (a) to accept the FMRR (and Extesision Term Base Rent) set forth in the Market Rent Notice, in which case the FMRR (and Extension Tenn Base [tent) shall be as set forth in the Market Rent Notice, or (b) to reject Landlord's determination of the FMRR (and Extension Term Base Rent), in which case the FMRR (and Extension Term Base Rent) shall be determined in accordance with Schedule "J-3". 3.3 [f Tempt fails to deliver Tenant's Market Rent Response Notice within tell (10) days after its receipt of a Market Rent Notice (o' Fails in its Market Response Notice to expressly reject Landlord's determination of the FMRR (and Extension Temt Base Rent) set forth in a Market Rent Notice), Tenant shall conclusively be deemed to have accepted Landlord's determination of [he FMRR (and Extension Term Base Rent) set forth in the Market Rent Notice. NO W Civic Center Or—Ga- n(Snnta..lnn Leave -2- Exhibit J Schedule ",1-2" Right of First Orfer I Grunt. Subjject to all of the (erns and conditions of this Exhibit "I".'Tenant shall have the right (tile "Right of First Offer") to elect to lease any portion of the First Right Space (defined below) that becomes Available for Lease (defined below) at any time during the Term. The "First Right space" means any space on the second (2"a) floor of the Building that is not within the Premises, A portion of the First Right Space shall be "Available For Leaso" if. (a) Landlord receives a Third Party Offer (defined below) with respect to such space, (b) such space is vacant or is scheduled to become vacant within six (6) months, and (a) such space is not subject to any than existing expansion or renewal rights of any type that is or are set forth in any lease affecting space in the Project. "A Third Party Offer" means any written offer or proposal for the leuse of all or any portion of the First Right Space that is delivered by Landlord to a third party, or that is received by Landlord from a third party, in either case, on temps that are acceptable to Landlord (excluding any such offers or proposals that either: (i) relate to any expansion or renewal rights that are set forth In any lease affecting space in the Project that exists as of the Effective Date or (if) are for the renewal or extension of the tern of the lease for any then existing tenant of the applicable portion of the First Right Space). Procedure for Offer and Accontance. 2,1 First Offer Notice, Subject to time terms and conditions of this Schedule "J-2" if all or any portion of the First Right Space becomes Available for Lease, Landlord shall notify Tenant thereof in writing (the "First Offer Notice"). The First Offer Notice shall also: (a) describe (and state the Rentable Area of) the portion of the First Right Space flint is then Available for Lease (the "Offered First Right Space"), (b) state the date (the "Offered Space Scheduled Commencement Date") upon which Landlord then believes the Offered First Right Space will be available for delivery to Tenant, (a) state Landlord's determination of the economic tens (including the Base Rent, Bose Year, Improvement Allowance, abated Rent and other Rent Concessions defined below) on which Landlord is willing to lease the Offered First Right Space to Tenant (the "Offered Terms"), and (d) state that the expiration of Tenant's lease of the First Right Space shall be coterminous with the lease for the Premises, provided that: (i) if there shall be less thnn rive (5) years remaining in the Term as of the at the Offered Space Scheduled Commencement Date for any Offered First Right Space, the First Offer Notice shall state that Tenant's exercise of its Right orFirst Offer with respect to such Offered First Right Space is conditioned upon Tenant concurrently exercising an Extension Option (with it being understood and agreed that Tenant shall have no right under this Schedule J-2" to lease oily portion of the First Right Space for which the Offered Space Scheduled Commencement Date will occur during the last five (5) years or the Term unless, (A) at such time, Tenant shall have an unexercised Extension Option and (B) Tenant shall, lit its Tenant's Acceptance Notice, exercise such Extension Option. 2,2 'fount's Acceptance Notice. Tenant may exercise its right to lease (he Offered Fh•st Right Space identified in any First Offer Notice only by delivering to landlord, not more (limn ten (10) business days after Landlord's delivery of the applicable First Offer Notice, written notice("Terwnfs Acceptance Notice") stating that Tenant accepts Landlord's oflor to lease the Offered First Right Space. If Tenant does not deliver Tenant's Acceptance Notice to Landlord within five (5) business clays after Landlord's delivery or any First Offer Notice, time being of the essence, than subject to Section 23 below, Tenant's Right of First Offer shall no longer apply to the applicable Offered First Right Space and, Landlord shall be face to lease the Offered First Right Space described in the First Offer Notice to third parties selected by Landlord at such rental rates and upon such terns as Landlord fit its sole discretion may desire, 23 Landlord's Ohlieation (a 12e-Offer Notwithstanding die foregoing, before leasing any Offered First Right Space to oily other person or entity on economic terms that are more than ten percent (10%) more Favorable (on tin annualized net effective rent buia) than the Offered -terms specified in the First Otter Notice, subject to all of the terms and conditions of this Schedule'?-2", Landlord must re -offer such Offered First Right Space to 'tenant on the more favorable economic terms by delivering another First Offer Notice with respect to such space in accordance with Section 2.1 of this Schedule "1-2" and Tenant shall again have the right to elect to lease such space by delivering a Tenant's ROFR Acceptance Notice in accordance with Section 1,1.2(b) of (his Schedule 1I-2" provided that'renant shall have only five (5) business days after receipt of any such First Offer Notice within which to deliver its Tenant's Acceptance Notice with respect to such Offered First (tight Space that is re -offered to Tenant in accordance with this Section 2.3, Term: Rent: Other T'e•nhs. 3.1 If Tenant duly exercises its Right of First Offer in accotdanee with this Schedule •'J-2" with respect to any OR'cred First Right Space that is identified in any First Offer Notice (any .such space "Leased First Right Space"). than; (a) the term or the lease oI'such Leased First Right Space shall commence upon the (late (the "First Right Commencement Date") that Land Iold tenders to ]'chant delivery of possession of such Leased First Right Space, (b) the expiration a('Tenant's le use of die Leased First Right Space shall be coterminous with the termination of the Lease for the then existing Premises, (c) except as expressly provided to the contrary in (his Schedule •'J-2" , the remaining terms of Tenant's lease orsuch Leased First Right Space shall be the terns and conditions or this Lease (provided that all provisions of the Lease which vary based upon the Rentable Area of the Premises shall be adjusted to reflect the addition o'the Lensed First Right Space to the Premises) and (b) Landlord zinc] Tenant shall rtusonabiy promptly thereafter execute nil amendment to this Lease for such Leased First Right Space upon the terms and conditions as set forth in the First Offer Notice, Humbled to the provisions orthis Schedule "J 2". 3.2 l'he monthly base rent payable by Tenant with respect to any Leased First Right Space (the "ROFO Bent") shall commence on the applicable First Bight Commencement Date and Shull be equal to the product ill': (a) the number of square real of Rentable Area contained in such Loused First Right Spuce and (b) the FMRR for such Leased First Right Space. If in the applicable Acceptance Notice, Tenant expressly rejects Landlord's delcrntinaion of the FMRR (anti ROFO treat) Ibr the applicable Leased First Right Space, than the FMRR (and ROFO Rent) Ibr such Leased First Right Space shall be detenined in accordance with Schedule "J-3", provided that irthe F1vIRR (and R01-0 Bent) for any Loosed First Right Spam shall not be determined as orthe First Right Conmtencenhent Dute. the parties shall utilize 1-un(1101Ws Submitted FMRR (defined below) to de(eraimC the ROFO Rent for the applicable Leased First Right Spuce, and if l'cnanCs Suhnhittcd FMRR shall be ultimately selected pursuant In 801 WCHIc Center Dr— C'itynfSonin Ana Leta,, -3- lixhibil J Schedule'?-3". Tenant shall be given a credit against ROM Rent next due hereunder equal to the amount of any overpayment. If Tenant fails, in the applicable Acceptance Notice, to expressly reject Landlord's determination of the FMRR (and ROFO Rent) set forth In the applicable First Offer Notice, then Tenant shall conclusively be deemed to have accepted Landlord's determination of the FMRR (and ROFO Rent) for the applicable Leased First Right Space as set forth it) the applicable First Often Notice, Notwithstanding anything to the contrary herein. Tenant shall pay Additional Rent with respect to any Leased First Right Space in the same manner as for the Initial Premises, including, without limitation, in accordance with the provisions of Section 4.2 of lie Lease, and Tenant's Percentage Share shall be increased to take into account the expansion of the Premises to include such Leased First Right Space. 3.4 Delivery and Condition or Lensed First Right Space; Delivery; Improvement. 3.4.1 Landlord shall endeavor to deliver the Leased First Right Space to Tenant on or before the applicable Offerer) Space Scheduled Commencement Date (as identified in the applicable First Offer Notice); provided, however, that if for any reason, Landlord is not in a position to so deliver snob Leased First Right Space on such date, Landlord shall not be in breach under this Lease and otherwise shall have no liability to Tenant so long as Landlord uses commercially reasonable efforts to deliver such Leased First Right Space to Tenant as soon n reasonably possible thereafter. 3.4.2 Tenant shall accept any Leased First Right Space in its then existing "AS IS" condition and state of repair, and Landlord shall not be required to perform any work, supply any materials or incur any expense (including the granting of any allowance to Tenant with respect thereto) to prepare any Leased First Right Space for Tenant's occupancy; provided, however, that: (a) Landlord shall cause the Leased First Right Space to be demised prior to the date on which it is delivered to Tenant, ethd (b) to the extent (and only to the extent) determined in connection with determination of the FMRR for any Leased First Right Space: (1) if such Leased First Right Space has not, prior to the date the same is delivered to Tenant, previously been improved, Landlord shall grant to Tenant, a rent free construction period (with respect to the ROFO Rent payable for such Leased First Right Space only) for the construction of the initial Leaschold Improvements (if any) in such Leased First Right Space, and (B) Landlord may gram to Tenant an improvement allowance to be used for costs that are incurred in connection with Ore construction of the initial Leasehold Improvements (if any) in such Leased First Right Space. The construction of all Leasehold Improvements by Tenant in any Leased First Right Space shall comply with the provisions oFArticle 10 of the Lease 8011I'Ciik Cenfur Dr—Ck, ufSwuu,bm Len.re -4. E\llihii I Schedule "J-3" Determinian FMRR, For purposes of determining the FMRR, the following procedure shall apply: I If Tenant duly exercises any Extension Option and duly rejects Landlord's determination (in its Market Rent Notice or the FMRR for the Extension, then Landlord and 'tenant shall endeavor to agree upon the FMRR for the Extension Term on or before the Outside Agreement Date (defined below), If Landlord and Tenant are unable to agree upon the FMRR for the Extension Term on or before the Outside Agreement Date, then the FMRR for the Extension Tenn shall be determined by arbitration pursuant to Sectiodn 2 oflhis Schedule'?-3". The "Outside Agreement Done" means the date that is ten (10) business days aller the date that Tenant notlf3es Landlord, in Its Market Rent Response Notice that Tenant has rejected Landlord's initial determination of the FMRR for the Extension Term. 2 If Landlord and Tenant shall fail to agree upon the FMRR for the Extension Term on or before the applicable Outside Agreement Date, then within ten (10) business days thereafter, each of Landlord and Tenant shall submit to the other its final determination of the FMRR for the Extension Term and such final determinations shall be submitted to arbitration (as Tenant's and L.andurd's "Submitted FMRR," respectively) in accordance with the following: 2.1 Landlord and Tenant shall each appoint one arbitrator who shall by profession be a realestate broker who shall have been active in the leasing of the Project and the Comparable Buildings over die five (5) year period ending on die date of such appointment. The determination of the arbitrators shall he limited solely to the issue as to whether Landlord's or Tenant's Submitted FMRR is the closest to the actual FMRR for the Extension Term, as determined by the arbitrators, taking into account the requirements of this Schedule "9-3". Each such arbitrator shall be appointed within fifteen (15) business days after the Outside Agreement Date. 2.2 The two arbitrators so appointed shall, within ten (10) business days of the date of the appointment or the second appointed arbitrator, agree upon and appoint a third arbitrator who shall be qualified under die same standard as described in Sectign 11 ol'this Schedule "J-3" (with respect to appointment of the initial two arbitrators). 2.3 The three arbitrators shall, within thirty (30) days of the appointment of the third arbitrator, reach a decision as to whether the parties shall use Landlord's or Tenant's Submitted FMRR and shall notify Landlord and Tenant thereof; provided that: (a) if either Landlord or Tenant tails to appoint an arbitrator within fifteen (15) business day period described in Section 2.1 of this Schedule "J-3", then the arbitrator appointed by the other party shall solely reach a decision as to the FMRR for die Extension Tern and notify Landlord and Tenant thereof within thirty (30) days following expiration of such fifteen (13) business day period, and such arbitrator's decision shall be binding upon Landloni anti 'tenant, and (b) if the two arbitrators fail to agree upon and appoint a third arbitrator, or both parties fail to appoint an arbitrator, then the appointment orthe, third rarbitrator or any arbitrator shall be dismissed and the matter to be decided shall be promptly submitted to arbitration under the provisions of the American Arbitration Association (the "AAA"), but subject to the instructions set forum in Nis Schedule "J-3". 2.4 The decision of die majority of the three arbitrators (or in the case of a decision made under clause (a) or (b) of Section 2.3 of this Schedule'9-3", the decision of the single orbitrator or the arbitrator(s) appointed by the AAA) shall be binding upon Landlord and Tenant, shall be in writing and shall be non•appentable, and counterpart copies thereof shall be delivered to Landlord and Tenant. A,judgment or order based upon such award may be entered in any court of competent jurisdiction, In rendering their decision and award, the arbitrators shall have no power to vary, nmodi fy or amend any provision ol'Nis Lease. 2.5 Landlord and Tenant shall each bear 50%of the cost of the arbitration described in this Section 2 ol'this• Schedule'?-3". 601 I1'C7r4e Canter Dr— CIO, gf.Santa nta Lease -]- Exhibit .I EXHIBIT'9P' EYEBROW SIGN I. Grant of Rights. In connection with Tenant's lease ofthe Premises, subject to all of the terms and conditions of this Exhibit "K", Tenant shall have the non-exclusive right to cause Landlord to display signage (the "Eyebrow Sign") identifying Tenant by its Business Name (defined below) on the Building in the location described in Sggflon 2.1 of this Exhibit "K". All of the Tenants rights under this Exhibit "K", are personal to the Original Tenant and are not transferable in connection with any Transfer or otherwise. "Business Name" means only "City of Santa Ana", or any other business or trade name of Tenant that not an Objectionable Name. "Objectionable Name" means any name that: (a) relates to an entity that is of a character or reputation, or is associated with a political orientation or faction that is materially inconsistent with We quality of the Project, or which would otherwise reasonably oflend on institutional quality landlord of a building comparable to the Buildings in Downtown Santa Ann, taking into consideration the size and visibility of the Pylon Sign or (b) conflicts with any then existing covenants in other leases of space in the Building or Project. Location; Specifications and Permit;. 2.1 Subject to Section 2.2 of this Exhibit "K" below, The Eyebrow Sign shall be located on the "eyebrow level" or the Building (i.e., just above the first flow of the Building) oil a side of the Building reasonably designated by Landlord. The graphics, materials, color, design, lettering, size, exact location, lighting (if any) and specifications and all other aesthetic factors (collectively, the "Sign SpeeiBenllons") of the Eyebrow Sign shall be approved by Landlord in its sole and absolute discretion. In addition, nli of Tenant's rights under this Exhibit "K" with respect to the Eyebrow Sign shall be subject to: (a) the receipt of and continuing compliance with all required governmental permits and approvals (and the submission of copies thereof to Landlord) required for the installation and continuing display of each of the Eyebrow Sign and (b) the continuing compliance of the Eyebrow Sign with all applicable Laws. 2.2 Landlord shall have the right, in Its sole but good faith discretion to: (a) position and/or reposition the Eyebrow Sign on the Building in any manner as it shall reasonably determine (provided that such Eyebrow Sign shall be located on the side of Uhe Building described in Section 2.1 of this Exhibit "K" above) and (b) place on or about die Building or Project (or on other signs for the Building or Project): (i) the name of (and/or other identifying information for) Landlord, the Building and/or Project or (ii) such other names, business names, trade names or affiliate names representing such other tenants or persons, in either case, as Landlord shall determine in its sole and absolute discretion. 3 Cost and Maintenance, The Eyebrow Sign shall be fsbrieated and installed by a contractor retained by Landlord, and shall be operated, and maintained by Landlord. Tenant shall, within ten (10) business days following Landlord's demand therefor, reimburse Landlord as Additional Rent, for all costs uud expenses actually incurred by Landlord in connection with or relating to the fabrication, installation, operation, maintenance, repair, and eventual removal and disposal of the Eyebrow Sign, including, without llmimtion, the cost of utility charges and hook-up fees (if applicable), permits, and maintenance and iepihs. The terms of this Section 3 of this Exhibit "K" shall survive the expiration orearlicr temhinntion of this Lease, 4. Termination: Renhnval 4.I Notwithstanding any provision of this Lease to die wntrary, by notice delivered to Tenant, Landlord may, at its option, elect to terminate all of Tenant's rights with respect to Elie Eyebrow Sign: (a) at any time that the Original Tenant (together with any Permitted State & County Transferees in accordance with Section 11 12 above) is no longer leasing and occupying 20,000 RSP in the Building, (b) if this Lease is assigned to any Person, or (e) if any Event of Default occurs. 4,2 Upon the expiration of earlier termination of Phis Lease, or alter termination of'1'enant's rights with respect to the Eyebrow Sign as provided above, Landlord may, at Tenant's sole cost and expense remove the Eyebrow Sign from the Building and cause the areas in which such Eyebrow Sign was located to be restored to the condition existing immediately prior to the placement of such sign (subject to ordinary wear and tenr). Tenant shall reimburse Landlord for till of its costs incurred in connection therewith in accordance with Section 3 of this Exhibit "K" above. 'the terms of th is Section 4.2 of this Exhibit "K" shall survive the expiration or earlier termination of this Lease. 80 t NCirir Cenmr Or— C'ily ofSanfu: I na Lead • 1- Exhibit K ENHIQIT "L" STATE REQUIRENIENTS I • If applicable, Landlord will provide a Seismic Certificate of Applicable Code in the form described in Schedule "L-P with respect to seismic adequacy. 2. Landlord has provided the Accessibility Survey with respect to the Premises and the path of travel frcar/to public transportation and public rights -of -way, parking and restroom areas attached hereto as Schedale "L-2 Landlord will perform all work required to correct the conditions identified in: (a) Form I (restriping ADA stalls); (b) Form 3A (Item 2) (install an Intercom system that will alert dedicated personnel to assist those in need from the public sidewalk); (c) Form 13 (modify elevators panels to provide minimum toe kick clearance); and (d) Form 16 (update the 2nd floor restrooms). 'rhe condition identified in Fomi 8 (Stairs) will not be corrected, and is accepted by Tenant as an acceptable hardship. 3. Landlord will additionally provide a Verified Report Form G following completion of construction. 801 lVCirrc Cerrfrr Ur—Cip n(Snnfn:1na Leave .I. rixhihir K Schedule "L-1" Form of Seismic Certiriente of Applicable Code [attached] 13468115 4'1234.1751 -�- 14 November2016 BJ# 1610377 William Lee, Vice President Ocean West Capital Partners 315 W. 9" Street, Suite 808 Los Angeles, CA 90015 STRUCTURAL Subject: Seismic Certificate for California Department of General Service A CIVIL 801 Civic Center Drive SHpIN88S.8 Dear Mr. Lee: Attached please find the Seismic Certificate requested by California Department of General Service (DGS) for the 4 story building at 801 Civic Center Drive, Santa Ana, CA 92701. The building was constructed in about 1983. The certificate states that this building was designed to meet the 1976 or subsequent editions of the Uniform Building Code and does not have any one of the enumerated characteristics or conditions listed In the certificate, The building has the condition of: • Welded steel moment frames (WSMF) that constitute the primary seismic force-reslsting system for the building, and • the structure was designed to bale requirements preceding those of the 1997 edition of the Uniform Building Code. However, the building has not: experienced an earthquake of sufficient magnitude and site peak ground motions that Inspection is required when any of the conditions of Section 3.2 of FEMA 352 Indicate an Investigation of beam -column connections is warranted The certificate does not require any analysis of the building or any comparison to the latest Building Code. Any soft story, discontinuity or irregularity that may be present in the building may affect the performance of the building In the event of a large earthquake. Our professional services have been performed With the intent to meet the degree of care and skill ordinarily exercised by reputable structural engineers practicing in this or similar localities. No other warranty, expressed or implied, is made as to the professional advice or opinions included in this report, If you have any questions regarding Information presented in this letter or the attached certificate, please feel free to contact us. Sincerely, BRANDOW &JOHNSTON, INC. Ryan) S.E., LEED AP Princl I Attachment: Seismic Checklist Seismic Certificate G:\16\1610377 Ocean West 801 W Civic Cntr Santa Ana Seismic Cert\1610377 901 W Civic Center Seismic Certificate lettecdoc 18831 Von Karman Avenue Suite 240 Irvine CA 92612 Tel, (949) 862-8500 Fax (949) 955-0794 Seismic Certificate of Applicable Code I am a State of California licensed structural engineer, civil engineer or architect and certify that the building located at; 801 Civic Center Drive, Santa Ana, CA 92701, was reviewed by me. This certification was either prepared by me or the bulk of work was performed under my direct supervision, I have no ownership Interest in the subject property. A Certificate of Applicable Code may be provided if the entire building was constructed under a permit approved by the local jurisdiction and was designed to meet one of the following requirements: Ell 998 or subsequent editions of the California Building Code; or, X 1976 or subsequent editions of the Uniform Building Code and the building does not have any one of the enumerated characteristics or conditions listed below: • Unreinforced masonry elements, whether load -bearing or not; not including brick veneer; • Precast, prestressed, or post -tensioned structural or architectural elements, except piles; • Flexible diaphragm (e,g., plywood) -shear wall (masonry or concrete) structural system constructed pursuant to editions of the Uniform Building Code prior to the 1997 edition; • Apparent additions, alterations, or repairs to the structural system made without a building permit; • Constructed on a site with a slope with one or more stories ap rtiall below grade (taken as 50% or less) for a portion of their exterior; • Soft or weak story, including wood frame structures with cripple walls, or is construction over first -story parking; • Seismic retrofit of the building, whether voluntary or mandated, whether partial or complete; • Repairs following an earthquake; • Welded steel moment frames (WSMF) that constitute the primary seismic force -resisting system for the building, and the structure was designed to code requirements preceding those of the 1997 edition of the Uniform Building Code, and the building site has experienced an earthquake of sufficient magnitude and site peak ground motions that inspection is required when any of the conditions of Section 3.2 of FEMA 352 indicate an investigation of beam -column connections is warranted; • Visible signs of distress or deterioration of structural or non-structural systems, e.g„ excessively cracked and/or spelling concrete walls or foundations, wood dry rot, etc. Documentation of the selected performance level evaluation will be retained by the preparer and shall be available to the State upon request. Name: Firm: Telephone No: License No: License Expiration Date: Ryan Bishoff Brandow & Johnston, Inc. 949-862-8510 SE 6250 06130117 � 11 /14/2016 Signature Date Comment: For a building not qualifying under the above criteria; an Independent Review must be performed. RELPS Option 2 30 April 09 SEISMIC SCREENING CHECKLIST Reviewer Name Total Bldg. Sq. Ft. . Agency Total Lease Sg, Ft.. L6Catign,., HoursofUse 1 Ratrofitsince 1976 No further screening required if documentation of retrofit Is provided. 2 AO Ty e of Building 8 pe of Con'struIctlon Tilt-Up8aan§ Pre 1933 1933 to 1976 Post 1976 a Score Masonry 10 8 1 Reinforced Concrete 7 5 1 Wood Frame 3 2 1 Steel 7 3 1 1 3 .He)g ht„of; Building ;I n. S.tories Max. number of stories allowable for screening is 6. Assign one point per story, La,, 1 min., 6max. Assign points as Indicated for counties as grouped in a, b, & c below (a) 12 points in Los Angeles, West 113 of San Bernardino, Contra Costa, Riverside, Santa Clara, Alameda, Ventura, San Francisco, Merin (b) 9 points in Sonoma, Santa Barbara, San Mateo, Orange, San Diego, Inyo, San Luis Obispo, Napa, Kern, Monterey, Solano, Humboldt, Mendocino (c) 3 points to all other counties not listed above. 9✓<! tal Y�! RPR¢P¢i3 � 1 B 14 TEP, YSpI P n0Ww90 tl�pEli#. 9t4ASIR37 Iai; 9�PI rfi fiGH 1�,9 "T .ftl�dit3$2p'i:H� 6u gg N7tlSd S fAll R3Si iAt ¢I" mud] i4Fi PY41h�1T Nffi All other configurations 6 Configuration (Plan View). (1.6) 4 12 9 9 3 7 1 1 3 7 7 7 7 Visible Defects Subjective scoring: 10 points max. assignable for all defects observed. The following list is of typical things to took for. a Dry rot; look for water stains on ceiling tiles and walls. b Damaged foundations; look for large cracks and misalignment c Sagging or shifted beams; look for bowing in center, check for position (parallel) relative to other members d Tilted walls or columns a Corrosion of steel; look for rust, flaking, etc. Check for water stains. f Cracks greater than 1l8" in masonry or concrete g Check for any material that crumbles (wood, plaster, conc., etc) (1-10) TOTAL Total score of 20 or above requires standard seismic certification. Copy of 5olsrec cnecost-eeaea. Js 28 Schedule "L-2" Accessibility Swvey (mtachedj 80/ II'Chic, Canlerbr- Citv,,JSnntn.Arm Leave -I- Exbibil K a, 011 CepM¢R • 5tf341r.• ASYgCLHfS March 10, 2017 Mr, William lee Vice President Ocean West 315 W. 9th Street, Suite 808 Los Angeles, CA 90015 RE: 801 W. Civic Center, Santa Ana —Accessibility Checklist RESD Project Number: 142056 6=wmwl Pmkway Gttivmr Gay, CA OW.".le Ilt&:i8 rA:G 6 f a fbuU\ nowm r bYreel, &Ab'I W LnaMyW,\x.OAPO0i1 21:Lt::e t9(:c) 10201 VMKvmmA"ua,SWIM isle Inb,..CA$2ri12 wg7l"14£ate; 61$ H.mn Bleemt, $uac iW &m Freodi ,CAS10.9 ma;lrr,:eFV+ 485A USRane I SOON Suit. i W 1.94New Jere COO tpa,;�l, te,n 135 N" RasiP.trees 5A, Rom New Ymh, Pr! arr.t'lz089mm w.vv.aaolaco r, Dear William, Upon review of the accessibility checkilst and survey of the site conditions, below is a summary of our findings and recommendations for correcting the non -compliant Items. In particular, remediatlon work for 3 specific Items on the list would have significant Impacts on other aspects of the building. Such Impact is listed for your consideration. -: Pa rking (Form 1) Item 1 thru 4 o Restripe parking, relocate or rework parking surface :.: Exterior Routes of Travel (Form 3A) o Item I— Condition does not apply if accessible parking is relocated o Item 2—Alternate provision to provide an Intercom system that will alert dedicated personnel to assist those In need Exterior Routes of Travel (Form 3B) Items 1 thru 2 o Condition does not apply if accessible parking is relocated ,i Curb Ramps (Form 4) Items 1 thru 2 o Condition does not apply if accessible parking is relocated .! Prinking Fountains (Form 5) e Drinking fountains are not required if tenant spaces have potable water access of occupants. ..; Ramps (Form 7) o Condition does not apply If accessible parking Is relocated .:: Stairs (Form 8) o Stair risers are %" higherthan code maximum. Remediation would require the reconstruction of the stairwells. The California building code has an explicit exception that would allow for such condition (11B-210.1 Exception:2) provided DGS accepts this as hardship. Building Entrances and Exits (Form10) o Provide required signage and adjust door closer .11)1 WC4dc Ceurer Dr— Chp olSonta,aen Lease _ I. Exhibit K Doors and Gates (Form 11) o Rework as required Elevators (Form 131 o Panels In the elevator will be reworked to provide the minimum required toe clearance distance Toilet Facilities (Form 16) o Rework as required Signage (Form 19) o Provide signage as required Alarms (Form 20) o Rework fire extinguisher cabinet Sincerely, Dickson 01, AIA Project Manager Page12 1316305A/1234.1751 .Z_ EXIJIRIT °M" APPROVED GOVERNMENTAL ENTITIES State of California— Employment Development Department State of California —Department of Rehabilitation County of Orange— Social Services Agency SER Jobs for Progress —Title V Grant; Private Nun -Profit Rancho Santiago Community College District- Santa Ana College Goodwill Industries Cornerstone/Job Crops 80111'C.h4e Ceu1er Dr— ClbvrJ'. unto Ann Leave _l. Exhibit h TABLE OF CONTENTS P9PQ ARTICLEI - DEFINITIONS .................................................................................................................................................................. I ARTICLE 2 - LEASE OF PREMISES; COMMON AREAS; PARKING; SIGNS ................................................................................. 3 ARTICLE 3 - DELIVERY; COMMENCEMENT; TERM; SURRENDER; HOLDING OVER ............................................................4 ARTICLE 4 - RENT AND OTHER CHARGES ............................................ ...................................... ................................................. 4 ARTICLE5 - TENANT'S TAXES ............................................................................................................... ....................... .... 5 ARTICLE6 - SECURITY DEPOSIT ................................................................................................. ....... ...... ........................ 5 ARTICLE 7 - USE OF PREMISES ..................................................... .......... I ............ I ........ .................. ....... I .... 15 ARTICLE9 . UTILITIES AND SERVICES .......................................................................................................................................... 6 ARTICLE 9 - MAINTENANCE AND REPAIRS ....................................................................................................................... ........... 6 ARTICLE10 - ALTERATIONS ...................................... ................................................................... .................................................... 6 ARTICLE I I - ASSIGNMENT AND SUBLETTING... ........... I ..... I ... I ..... I ........ 1.11 ................................................................................... 7 ARTICLE 12. SUBORDINATION AND ATTORNMENT; ESTOPPEL CERTIFICATES; FINANCIAL STATEMENTS ................8 ARTICLE13 - CASUALTY; TAKING ................................ ............................... I ...... ................................................ ................. 8 ARTICLE 14 - INDEMNIFICATION AND INSURANCE ...................................................................................................................... 9 ARTICLE 15 - EVENTS OF DEFAULT AND REMEDIES .............. .................................................................... ............. ................. 9 ARTICLE 16 - LANDLORD'S DEFAULT; LANDLORD'S LIABILITY .............. I ... I., ..... .... I .................................... ................. 10 ARTICLE17 - MISCELLANEOUS ................................................................... ............................. ..... ............................................... 10 EXHIBIT "A" Depiction of the Premises EXHIBIT"B" Notice ofLeaseTerm Dates EXHIBIT"C" Work Letter Agreement EXHIBIT"D" Rules and Regulations EXIIIBIT"E" Additional Real EXHIBIT"F" Services and Utilities EXHIBIT"G" Insurance Requirements EXHIBIT"l-I" Remedies EXHIBIT"I" Form of'renint Estoppel Certificate EXHIBIT "J" Options FXHIBIT"K" Eyebrow Sign EXHIBIT"12' State Requirements EXHIBIT "Id" Approved Governments] Entities 80 1 11'Chriv Crider Dr—C[0-#fSimmAn a Leave -i- TWC ol'CMILCII(A SERJ0.1 OP ID: DC '�4ccaR® CERTIFICATE OF LIABILITY INSURANCE DATE(MMIDDNWY) 0510212019 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER, THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. IMPORTANT: If the certificate holder Is an ADDITIONAL INSURED, the pollcy(les) must be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement($). PRODUCER DLL Insurance Agenvy 1843 E Fir Ave 0102 Fresno, CA 93720 Joe Martinez CONTACT Diana Ramos PHONE FAX c o t • 560.721.4706 we Na : 669-4613416 ADD"R'E SS; dramos@dlllnsurance.com INSURER(SI AFFORDING COVERAGE NAICp INSURER A:Phlladel hIs Indemnity Ins Cc 18068 INSURED SER-JOBS FOR PROGRESS, INC. 265 N Fulton St 106 Fresno, CA 93701.1600 INSURERB.State Compensation Insurance 36076 INsuRERc: Philadelphia insurance Gompani 18068 INSURER D: INSURER E IN$URERF: COVERAGES CERTIFICATE NUMBER: REVISION NUMBER: THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT W71d RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS, MSR LTR TYPE OF INSURANCE DDL UWR D POLICY NUMBER MMIDDIYYYY) MINWNYWI LIMITS A X COMMERCIAL GENERAL LIABILITY CLAIMS -MADE TOCCUR X PHPKI884914 09/27/20180912712019 EACH OCCURRENCE $ 2,000,000 PREMISESEa 0XUrrQ1Wn $ 100,000 OWL MED EXP(Any one person) $ 6,00 PERSONAL$ADV INJURY $ 1,000,000 AGGREGATE LIMIT APPLIES PER: POLICY F7 PRJECTO- ❑ LOG OTHER', GENERAL AGGREGATE $ 3,000,000 PRODUCTS-COMPIOPAGG $ 3,000,000 $ A AUTOMOBILE LIABILITY ANVAUTO AUTOS�ED X AUTOSULED X X NON -OWNED HIRED AUTOS AUTOS PHPKI884914 09/2712018 09/27/2019 COMBINEDSINGLF LIMIT (Ed occldent $ 1,000,000 BODILY INJURY (Per person) $ BODILV INJURY (Per accltlsnt) $ PROPERTY 0AMAUP er accider1U $ „-, $— D )( UMBRELLA LIA9 EXCESS LIAR X OCCUR clams -MADE PHUS669716 03101/2019 03/0112020 EACHOCCURRENCE $ 1,000,000 AGGREGATE $ 1,000,000 DED I X I RETENTION$ 10,000 $ B WORKERS COMPENSATION AND EMPLOYERS' LIABILITY ANY PROPRIETORIPARTNERIEXECU71VE YIN OFFICERIMEM9RR EXCLUDED? (Mandatory in NN) fyyes, daecllbe under IDESCRIPTIONOFOPERATIONSbelaw NIA 18277412018 07/01/2018 07101/2019 X STATUTE EOT R E.L. EACH ACCIDENT & 1,000,000 E.L.OISEASE-EAEMPLOYE S 1,000,000 E.L. DISEASE-POLI CY LIMIT $ 1,000,000 i DESCRIPTION OF OPERATIONS I LOCATIONS I VEHICLES LCORD 101, Additional Romarlm Scltadu[a, may be attached It more apace Is required) Notice of Cancellation is 30 days except in the event of cancellation due to non-payment or non -reporting which Is 10 days. City of Santa Ana, its officers, agents, employees and volunteers are named as Additional Insureds, 1 ULKl II'ILiAlt HULUMK WHI4 L,GLLH I IUN COMMDEV SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN Community Development Agency ACCORDANCE WITH THE POLICY PROVISIONS. M-25 City of Santa Ana AUTHORIZED REPRESENTATIVE PO Box 1988 / j' Santa Ana, CA 92702 ®1988.2014 ACORD CORPORATION. All rights reserved. ACORD 26 (2014101) The ACORD name and logo are registered marks of ACORD PI-GLD-HS (10t11) THIS ENDORSEMENT CHANGES THE POLICY, PLEASE READ IT CAREFULLY. GENERAL LIABILITY DELUXE ENDORSEMENT: HUMAN SERVICES This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE It is understood and agreed that the following extensions only apply in the event that no other specific coverage for the indicated loss exposure is provided under this policy. If such specific coverage applies, the terms, conditions and limits of that coverage are the sole and exclusive coverage applicable under this policy, unless otherwise noted on this endorsement, The following is a summary of the Limits of Insurance and additional coverages provided by this endorsement. For complete details on specific coverages, consult the policy contract wording. Coverage Applicable Limit of Insurance Page # Extended Property Damage Included 2 Limited Rental Lease Agreement Contractual Liability $5D,000limit 2 Non -Owned Watercraft Less than 58 feet 2 Damage to Property You Own, Rent, or Occupy $30,000 limit 2 Damage to Premises Rented to You $1,000,000 3 HIPAA Clarification 4 Medical Payments $20,000 5 Medical Payments — Extended Reporting Period 3 years 5 Athletic Activities Amended 5 Supplementary Payments —Bail Bonds $5,000 5 Supplementary Payment — Lass of Earnings $1,000 per day 5 Employee Indernnificatlon Defense Coverage $25,000 5 Key and Lock Replacement —Janitorial Services Client Coverage $10,000limit - 5 Additional Insured — Newly Acquired Time Period Amended 8 Additional Insured —Medical Directors and Administrators Included 7 Additional Insured — Managers and Supervisors (with Fellow Employee Coverage) Included 7 Additional Insured — Broadened Named Insured Included 7 Additional Insured — FundingSource Included 7 Additional Insured— Horne rare Providers Included 7 Additional Insured — Managers, Landlords, or Lessors of Premises included 7 Additional Insured— Lessor of Leased Equipment Included 7 Additional Insured— Grantor of Permits included 8 Additional Insured — Vendor Included 8 Additional Insured — Franchisor Included 9 Additional Insured —When Required by Contract included 9 Additional insured — Owners, Lessees, or Contractors Included 9 Additional Insured — State or Political Subdivisions Included 10 Page 1 of 12 Includes copyrighted material of Insurance Services Office, Inc., with its 0 2011 Philadelphia Indemnity Insurance Company PI-GILD-HS (10/11) Duties in the Event of Occurrence, Claim or Suit Included 10 Unintentional Failure to Disclose Hazards Included 10 Transfer of Rights of Recovery Against Others To Us Clarification 10 Liberalization Included 11 Bodily Injury —includes Mental Anguish Included 11 Personal and Advertising Injury — Includes Abuse of Process, Discrimination Included 11 A. Extended Property Damage SECTION I — COVERAGES, COVERAGE A BODILY INJURY AND PROPERTY DAMAGE LIABILITY, Subsection 2, Exclusions, Paragraph a, is deleted in its entirety and replaced by the following: a. Expected or Intended Injury "Bodily Injury" or property damage" expected or intended from the standpoint of the insured. This exclusion does not apply to "bodily injury" or "property damage" resulting from the use of reasonable force to protect persons or property. B. Limited Rental Lease Agreement Contractual Liability SECTION I — COVERAGES, COVERAGE A. BODILY INJURY AND PROPERTY DAMAGE LIABILITY, Subsection 2. Exclusions, Paragraph b, Contractual Liability Is amended to Include the following: (3) Based on the named insured's request at the time of claim, we agree to indemnify the named insured for their liability assumed in a contract or agreement regarding the rental or lease of a premises on behalf of their client, up to $50,000. This coverage extension only applies to rental lease agreements. This coverage Is excess over any renter's liability insurance of the client. C. Non -Owned Watercraft SECTION I —COVERAGES, COVERAGE A BODILY INJURY AND PROPERTY DAMAGE LIABILITY, Subsection 2. Exclusions, Paragraph g. (2) is deleted in its entirety and replaced by the following: (2) A watercraft you do not own that is; (a) Less than 58 feet long; and (b) Not being used to carry persons or property for a charge; This provision applies to any person, who with your consent, either uses or is responsible for the use of a watercraft. This insurance is excess over any other valid and collectible insurance available to the insured whether primary, excess or contingent. D. Damage to Property You Own, Rent or Occupy SECTION I — COVERAGES, COVERAGE A BODILY INJURY AND PROPERTY DAMAGE Page 2 of 12 Includes copyrighted material of Insurance Services Office, Inc., with its © 2011 Philadelphia Indemnity Insurance Company PhGLD-HS (10/11) LIABILITY, Subsection 2. Exclusions, Paragraph j. Damage to Property, Item (1) is deleted in Its entirety and replaced with the following: (1) Property you own, rent, or occupy, including any costs or expenses Incurred by you, or any other person, organization or entity, for repair, replacement, enhancement, restoration or maintenance of such property for any reason, including prevention of injury to a person or damage to another's property, unless the damage to property is caused by your client, up to a $30,000 limit. A client is defined as a person under your direct care and supervision. E. Damage to Premises Rented to You 1. If damage by fire to premises rented to you is rot otherwise excluded from this Coverage Part, the word "fire" is changed to "fire, lightning, explosion, smoke, or leakage from automatic fire protective systems" where it appears In: a. The last paragraph of SECTION I —COVERAGES, COVERAGE A BODILY INJURY AND PROPERTY DAMAGE LIABILITY, Subsection 2. Exclusions; is deleted in its entirety and replaced by the following, Exclusions c. through n. do not apply to damage by fire, lightning, explosion, smoke, or leakage from automatic fine protective systems to premises while rented to you or temporarily occupied by you with permission of the owner. A separate limit of insurance applies to this coverage as described in SECTION III — LIMITS OF INSURANCE. b. SECTION III — LIMITS OF INSURANCE, Paragraph 6. is deleted in its entirety and replaced by the following: Subject to Paragraph 5. above, the Damage To Premises Rented To You Limit is the most we will pay under Coverage A for damages because of "property damage" to any one premises, while rented to you, or in the case of damage by fire, lightning, explosion, smoke, or leakage from automatic fire protective systems while rented to you or temporarily occupied by you with permission of the owner. c. SECTION V — DEFINITIONS, Paragraph 9.a., is deleted in its entirety and replaced by the following: A contract for a lease of premises. However, that portion of the contract for a lease of premises that indemnifies any person or organization for damage by fire, lightning, explosion, smoke, or leakage from automatic fire protective systems to premises while rented to you or temporarily occupied by you with permission of the owner is not an "insured contract"; 2. SECTION IV — COMMERCIAL GENERAL LIABILITY CONDITIONS, Subsection 4. Other Insurance, Paragraph b. Excess insurance, (1) (a) (U) is deleted in its entirety and replaced by the following: That is insurance for fire, lightning, explosion, smoke, or leakage from automatic fire prol systems for premises rented to you or temporarily occupied by you with permission of the owner; 3. The Damage To Premises Rented To You Limit section of the Declarations is amended to the greater of: Page 3 of 12t!,NZ u Includes copyrighted material of Insurance Services Office, Inc., with its parmiss n. � 9 2011 Philadelphia Indemnity insurance Company 1 PI-GLD-HS (10/11) a. $1,000,000; or b. The amount shown in the Declarations as the Damage to Premises Rented to You Limit. This is the most we will pay for all damage proximately caused by the same event, whether such damage results from fire, lightning, explosion, smoke, or leeks from automatic fire protective systems or any combination thereof. F. HIPAA SECTION I — COVERAGES, COVERAGE B PERSONAL AND ADVERTISING INJURY LIABILITY, is amended as follows: 1. Paragraph 1. Insuring Agreement is amended to include the following: We will pay those sums that the insured becomes legally obligated to pay as damages because of a "violation(s)" of the Health Insurance Portability and Accountability Act (HIPAA). We have the right and the duty to defend the insured against any "suit," "investigation,° or "civil proceeding" seeking these damages. However, we will have no duty to defend the Insured against any "suit" seeking damages, "investigation," or "civil proceeding" to which this Insurance does not apply. 2. Paragraph 2. Exclusions Is amended to include the following additional exclusions: This insurance does not apply to: a. intentional, Willful, or Deliberate Violations Any willful, intentional, or deliberate "violation(s)" by any insured. b. Criminal Acts Any "violation" which results in any criminal penalties under the HIPAA. c. Other Remedies Any remedy other than monetary damages for penalties assessed. d. Compliance Reviews or Audits Any compliance reviews by the Department of Health and Human Services. 3. SECTION V — DEFINITIONS is amended to Include the following additional definitions a, "Civil proceeding" means an action by the Department of Health and Human Services (HHS) arising out of "violatlons." b. "Investigation" means an examination of an actual or alleged "violation (a)" by HHS. However, 'Investigation" does not include a Compliance Review. c. "Violation" means the actual or alleged failure to comply with the regulations included in the f HIPAA. Page of 12 � Includes copyrighted material of Insurance Services Office, Inc., with its permission. 1 @ 2011 Philadelphia Indemnity Insurance Company t PI-GLD-HS (1Oil 1) G. Medical Payments — Limit Increased to $20,000, Extended Reporting Period If COVERAGE C MEDICAL PAYMENTS is not otherwise excluded from this Coverage Part: 1. The Medical Expense Limit is changed subject to all of the terms of SECTION III -LIMITS OF INSURANCE to the greater of: a. $20,000;or b. The Medical Expense Limit shown in the Declarations of this Coverage Part. 2. SECTION I —COVERAGE, COVERAGE C MEDICAL PAYMENTS, Subsection 1. Insuring Agreement, a. (3) (b) is deleted in its entirety and replaced by the following: (b) The expenses are incurred and reported to us within three years of the date of the accident, H. Athletic Activities SECTION I— COVERAGES, COVERAGE C MEDICAL PAYMENTS, Subsection 2. Exclusions, Paragraph e. Athletic Activities is deleted in its entirety and replaced with the following: a. Athletic Activities To a person injured while taking part in athletics, i. Supplementary Payments SECTION I — COVERAGES, SUPPLEMENTARY PAYMENTS - COVERAGE A AND B are amended as follows; 1, b, is deleted in its entirety and replaced by the following: 1. b. Up to $5000 for cost of bail bonds required because of accidents or traffic law violations arising out of the use of any vehicle to which the Bodily Injury Liability Coverage applias, We do not have to furnish these 14 Is deleted in its entirety and replaced by the following: 1. d. All reasonable expenses incurred by the insured at our request to assist us in the investigation or defense of the claim or "suit", including actual loss of earnings up to $1,000 a day because of time off from work. J. Employee Indemnification Defense Coverage SECTION I — COVERAGES, SUPPLEMENTARY PAYMENTS — COVERAGES A AND B the following is added: We will pay, on your behalf, defense costs incurred by an "employee" in a criminal proceeding occurring in the course of employment, The most we will pay for any "employee" who is alleged to be directly involved in a criminal proceeding is $25,000 regardless of the numbers of 'employees,' claims or "suits" brought or persons or organizations making claims or bringing "suits. Page 5 of 12 V- Includes copyrighted material of Insurance Services Office, Inc., with its permission CP 2011 Philadelphia Indemnity Insurance Company 61, PI-GLD-HS (10/11) K, Key and Lock Replacement —Janitorial Services Client Coverage SECTION I — COVERAGES, SUPPLEMENTARY PAYMENTS — COVERAGES A AND B is amended to include the following: We will pay for the cost to replace keys and locks at the "clients" promises due to theft or other loss to keys entrusted to you by your "client," up to a $10,000 limit per occurrence and $10,000 policy aggregate, We will not pay for loss or damage resulting from theft or any other dishonest or criminal act that you or any of your partners, members, officers, "employees", "managers", directors, trustees, authorized representatives or any one to whom you entrust the keys of a "client' for any purpose commit, whether acting alone or in collusion with other persons The following, when used on this coverage, are defined as follows; a. "Client" means an individual, company or organization with whom you have a written contract or work order for your services for a described premises and have billed for your services, b. "Emp€oyse" means (1) Any natural person: (a) While in your service or for 30 days after termination of service; (b) Who you compensate directly by salary, wages or commissions; and (c) Who you have the right to direct and control while performing services for you; or (2) Any natural person who is furnished temporarily to you: (a) To substitute for a permanent "employee" as defined in Paragraph (1) above, who is on leave; or (b) To meet seasonal or short-term workload conditions; while that person is subject to your direction and control and performing services for you. (3) "Employee" does not mean, (a) Any agent, broker, person leased to you by a labor leasing firm, factor, commission merchant, consignee, independent contractor or representative of the same general character; or (b) Any "manager," director or trustee except while performing acts coming within the scope of the usual duties of an "employee." c, "Manager" means a person serving in a directorial capacity for a limited liability company. L. Additional Insureds SECTION It — WHO IS AN INSURED is amended as follows: 1. If coverage for newly acquired or formed organizations is not otherwise excluded from this Page a of 12 /I Includes copyrighted material of Insurance Services Office, Inc., with its permissi © 2011 Philadelphia Indemnity Insurance Company +� i )rl PI-GLD-HS (10/11) Coverage Part, Paragraph 3.a. is deleted in Its entirely and replaced by the following: a. Coverage under this provision is afforded until the end of the policy period, 2. Each of the following is also an insured: a. Medical Directors and Administrators - Your medical directors and administrators, but only while acting within the scope of and during the course of their duties as such. Such duties do not Include the furnishing or failure to furnish professional services of any physioian or psychiatrist in the treatment of a patient. b. Managers and Supervisors - Your managers and supervisors are also insureds, but only with respect to their duties as your managers and supervisors. Managers and supervisors who are your "employees" are also insureds for "bodily injury" to a co - "employee" while in the course of his or her employment by you or performing duties related to the conduct of your business. This provision does not change Item 2.a.(1)(a) as it applies to managers of a limited liability company. c. Broadened Named Insured - Any organization and subsidiary thereof which you control and actively manage on the effective date of this Coverage Part. However, coverage does not apply to any organization or subsidiary not named in the Declarations as Named Insured, if they are also Insured under another similar policy, but for its termination or the exhaustion of its limits of insurance. d. Funding Source -Any person or organization with respect to their liability arising out of: (1) Their financial control of you; or (2) Premises they own, maintain or control while you lease or occupy these premises. This Insurance does not apply to structural alterations, new construction and demolition operations performed by or for that person or organization. e. Home Care Providers - At the first Named Insured's option, any person or organization under your direct supervision and control while providing for you private home respite or foster home care for the developmentally disabled. f. Managers, Landlords, or Lessors of Premises -Any person or organization with respect to their liability arising out of the ownership, maintenance or use of that part of the premises leased or rented to you subject to the following additional exclusions: This insurance does not apply to: (1) Any "occurrence" which takes place after you cease to be a tenant in that premises; or (2) Structural alterations, new construction or demolition operations performed by or on behalf of that person or organization. g. Lessor of Leased Equipment- Automatic Status When Required In Lease Agreement With You -Any person or organization from whom you lease equipment when you and such person or organization have agreed in wrifing in a contract or agreement that such person or organization is to be added as an additional insured on your policy, Such person or Page 7 of 12 Includes copyrighted material of Insurance Services Office, Inc., with Its Cci 2011 Philadelphia Indemnity Insurance Company PI-GLD-HS (10/11) organization is an insured only with respect to liability for "bodily Injury," "property damage" or "personal and advertising injury" caused, in whole or in part, by your maintenance, operation or use of equipment leased to you by such person or organization. A person's or organization's status as an additional Insured under this endorsement ends when their contract or agreement with you for such leased equipment ends. With respect to the insurance afforded to these additional insureds, this insurance does not apply to any "occurrence" which takes place after the equipment lease expires. In. Grantors of Permits — Any state or political subdivision granting you a permit in connection with your premises subject to the following additional provision; (1) This insurance applies only with respect to the following hazards for which the state or political subdivision has issued a permit in connection with the premises you own, rent or control and to which this insurance applies; (a) The existence, maintenance, repair, construction, erection, or removal of advertising signs, awnings, canopies, cellar entrances, coal holes, driveways, manholes, marquees, hoist away openings, sidewalk vaults, street banners or decorations and similar exposures; (b) The construction, erection, or removal of elevators; or (c) The ownership, maintenance, or use of any elevators covered by this insurance. 1. Vendors — Only with respect to "bodily injury" or "property damage" arising out of "your products" which are distributed or sold in the regular course of the vendor's business, subject to the following additional exclusions: (1) The insurance afforded the vendor does not apply to: (a) "Bodily injury" or "property damage" for which the vendor is obligated to pay damages by reason of the assumption of liability in a contract or agreement. This exclusion does not apply to liability for damages that the vendor would have in the absence of the contract or agreement; (b) Any express warranty unauthorized by you; (c) Any physical or chemical change in the product made intentionally by the vendor; (d) Repackaging, except when unpacked solely for the purpose of inspection, demonstration, testing, or the substitution of parts under instructions from the manufacturer, and then repackaged in the original container; (a) Any failure to make such inspections, adjustments, tests or servicing as the vendor has agreed to make or normally undertakes to make in the usual course of business, in connection with the distribution or sale of the products; (f) Demonstration, Installation, servicing or repair operations, except such operations performed at the vendor's premises in connection with the sale of the product; Page 8 of 12 Includes copyrighted material of Insurance Services Office, Inc., with its 0 2011 Philadelphia Indemnity Insurance Company PI-GLb-HS (10/11) (g) Products which, after distribution or sale by you, have been labeled or relabeled or used as a container, part or ingredient of any other thing or substance by or for the vendor. or (h) "Bodily injury" or "property damage" arising out of the sole negligence of the vendor for its own acts or omissions or those of Its employees or anyone else acting on its behalf. However, this exclusion does not apply to: (1) The exceptions contained in Sub -paragraphs (d) or (f); or (ii) Such inspections, adjustments, tests or servicing as the vendor has agreed to make or normally undertakes to make in the usual course of business, in connection with the distribution or sate of the products. (2) This Insurance does not apply to any insured person or organization, from whom you have acquired such products, or any ingredient, part or container, entering into, accompanying or containing. j. Franchisor — Any person or organization with respect to their liability as the grantor of a franchise to you. k. As Required by Contract — Any person or organization where required by a written contract executed prior to the occurrence of a loss, Such person or organization is an additional insured for "bodily injury, "property damage" or "personal and advertising injury" but only for liability arising out of the negligence of the named Insured. The limits of insurance applicable to these additional insureds are the lesser of the policy limits or those limits specified in a contract or agreement. These limits are included within and not in addition to the limits of insurance shown in the Declarations L Owners, Lessees or Contractors — Any person or organization, but only with respect to liability for "bodily injury," "property damage" or "personal and advertising injury" caused, in whole or in part, by: (1) Your acts or omissions; or (2) The acts or omissions of those acting on your behalf; in the performance of your ongoing operations for the additional insured when required by a contract. With respect to the insurance afforded to these additional insureds, the following additional exclusions apply: This insurance does not apply to "bodily injury" or "property damage" occurring after: (a) All work, including materials, parts or equipment furnished In connection with such work, on the project (other than service, maintenance or repairs) to be performed by or on behalf of the additional insured(s) at the location of the covered operations has been completed; or (b) That portion of "your work" out of which the injury or damage arises has been put to its Intended use by any person or organization other than another contractor or subcontractor engaged In performing operations for a principal as a part of the same project. Page 9 of 12 Includes copyrighted material of Insurance Services Office, Inc., with its 02011 Philadelphia Indemnity insurance Company PI-GLD-HS (10/11) m. State or Political Subdivisions —Any state or political subdivision as required, subject to the following provisions: (1) This insurance applies only with respect to operations performed by you or on your behalf for which the state or political subdivision has issued a permit, and is required by contract. (2) This insurance does not apply to: (a) "Bodily injury," "property damage" or "personal and advertising injury" arising out of operations performed for the state or municipality; or (b) 'Bodily injury" or "property damage" included within the "products -completed operations hazard," M. Duties in the Event of Occurrence, Claim or Suit SECTION IV — COMMERCIAL GENERAL LIABILITY CONDITIONS, Paragraph 2, is amended as follows: a. is amended to include; This condition applies only when the "occurrence" or offense is known to: (1) You, if you are an individual; (2) A partner, if you are a partnership; or (3) An executive officer or insurance manager, if you are a corporation. b. is amended to include: This condition will not be considered breached unless the breach occurs after such claim or "suit" is known to: (1) You, if you are an individual; (2) A partner, if you are a partnership; or (3) An executive officer or insurance manager, If you are a corporation. N. Unintentional Failure To Disclose Hazards SECTION IV — COMMERCIAL GENERAL LIABILITY CONDITIONS, 6. Representations is amended to include the following: It is agreed that, based on our reliance on your representations as to existing hazards, if you should unintentionally fail to disclose all such hazards prior to the beginning of the policy period of this Coverage Part, we shall not deny coverage under this Coverage Part because of such failure. O. Transfer of Rights of Recovery Against Others To Us SECTION IV — COMMERCIAL GENERAL LIABILITY CONDITIONS, 8. Transfer of Rights of Page 10 of 12 Includes copyrighted material of Insurance Services Office, Inc., with its permis © 2011 Philadelphia Indemnity Insurance Company 111r� PI-GLD-HS (10/11) Recovery Against Others To Us is deleted in its entirety and replaced by the following: If the Insured has rights to recover all or part of any payment we have made under this Coverage Part, those rights are transferred to us. The insured must do nothing after loss to impair them. At our request, the insured will bring "suit' or transfer those rights to us and help us enforce them. Therefore, the Insured can waive the Insurer's rights of recovery prior to the occurrence of a loss, provided the waiver is made In a written contract. P. Liberalization SECTION IV — COMMERCIAL GENERAL LIABILITY CONDITIONS, is amended to include the following: If we revise this endorsement to provide more coverage without additional premium charge, we will automatically provide the additional coverage to all endorsement holders as of the day the revision is effective in your state. O. Bodily Injury — Mental Anguish SECTION V — DEFINITIONS, Paragraph 3. Is deleted in Its entirety and replaced by the following: "Bodily injury" means: a. Bodily injury, sickness or disease sustained by a person, and includes mental anguish resulting from any of these; and b. Except for mental anguish, includes death resulting from the foregoing (Item a. above) at any time. R. Personal and Advertising Injury —Abuse of Process, Discrimination If COVERAGE B PERSONAL AND ADVERTISING INJURY LIABILITY COVERAGE is not otherwise excluded from this Coverage Part, the definition of "personal and advertising injury" is amended as follows: 1. SECTION V —DEFINITIONS, Paragraph 14.1c. is deleted In its entirety and replaced by the following; b. Malicious prosecution or abuse of process; 2. SECTION V — DEFINITIONS, Paragraph 14. is amended by adding the following: Discrimination based on race, color, religion, sex, age or national origin, except when: a. Done intentionally by or at the direction of, or with the knowledge or consent of: (1) Any insured; or (2) Any executive officer, director, stockholder, partner or member of the insured; b. Directly or indirectly related to the employment, former or prospective employment, W termination of ernpioyment, or application for employment of any person or persons by an insured; Page 12 Includes copyrighted material of Insurancee See rvices Office, Inc., with Its permissi 2011 Philadelphia Indemnity Insurance Company r� s PI-GLD-HS (10111) c. Directly or indirectly related to the sale, rental, lease or sublease or prospective sales, rental, lease or sub -lease of any room, dwelling or premises by or at the direction of any insured; or d, Insurance for such discrimination is prohibited by or held in violation of law, public policy, legislation, court decision cr administrative ruling. The above does not apply to fines or penalties imposed because of discrimination. Page 12 of 12 �J Includes copyrighted material of Insurance Services Office, Inc., with its permissi 02011 Philadelphia Indemnity Insurance CompanPA ' ' A,