HomeMy WebLinkAboutCMS Solutions Consent To Sublease of Land Lease and Agreement and Estoppel- (N Grove Bus Park Assoc Inc) 2-9-2430380938.1/525341.0001
CONSENT TO
SUBLEASE OF LAND LEASE AND
AGREEMENT
AND ESTOPPEL REGARDING
2727 NORTH GROVE INDUSTRIAL, FRESNO, CA 93727
This CONSENT TO SUBLEASE OF LAND LEASE AND AGREEMENT AND
ESTOPPEL (Consent) is made as of this _9th_ day of February, 2024, by and between the CITY
OF FRESNO, a municipal corporation through its Airports Department (Lessor), and NORTH
GROVE BUSINESS PARK ASSOCIATION, INC., a California corporation (Sublessor) and CMS
SOLUTIONS, a California corporation (Sublessee). Sublessor and Sublessee are collectively the
Parties.
RECITALS
WHEREAS, Lessor and Sublessor are parties to a certain August 20, 2007, Land Lease
and Agreement (Ground Lease), is attached hereto as Exhibit A and incorporated herein, wherein
Sublessor agreed to lease certain real property identified in Exhibit A (Leased Premises).
WHEREAS, by Sublease between Sublessor and Sublessee, Sublessor has agreed to
sublease a portion of the Leased Premises (the Subleased Premises) to Sublessee, as more fully
described and set forth in the Sublease; and
WHEREAS, Sublessor and Sublessee hereby request Lessor's consent to the Sublease,
and Lessor is willing to consent to this Sublease in the public interest and upon the terms and
conditions herein.
WHEREAS, in entering this Consent and the Sublease, it is recognized, understood, and
agreed that Sublessor shall remain responsible and liable respecting the referenced Ground
Lease. Sublessee shall also be jointly and severally responsible and liable with respect to certain
provisions of the Ground Lease as stated and defined as "Assumed Obligations" in the Sublease.
NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of
which are acknowledged, Lessor, Sublessor and Sublessee agree as follows:
Section 1. Consent to Sublease
a. Lessor hereby consents to the subletting of the Subleased Premises by Sublessor
to Sublessee pursuant to the Sublease, such consent being subject to and upon the terms and
conditions set forth herein. The parties understand that nothing contained in this Consent shall:
1. Operate as an approval or ratification by the Lessor of any of the provisions
of the Sublease, except as specifically set forth herein, or as a representation or warranty by
Lessor in writing, and, except as may be otherwise set forth herein, Lessor shall not be bound or
estopped in any way by the provisions of the Sublease;
2. Be construed to modify, waive or affect: (i) any of the provisions,
covenants or conditions in the Ground Lease, (ii) any of Sublessor's obligations under the Ground
Lease, or (iii) any rights or remedies of Lessor under the Ground Lease or otherwise or to enlarge
or increase Lessor's obligations or Sublessor's rights under the Ground Lease or otherwise;
3. Be construed to waive any future breach or default on the part of Sublessor
under the Ground Lease; or
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4. Constitute a waiver by Lessor of its rights to receive any future amounts due
from Sublessor to Lessor.
b. This Consent is not assignable, except in connection with permitted or consented
to assignments.
c. The Sublease shall be subject and subordinate at all times to the Ground Lease and
all of its provisions, covenants and conditions. In, case of any conflict between the provisions of the
Ground Lease and the provisions of the Sublease, the provisions of the Ground Lease shall prevail
unaffected by the Sublease, but subject to the express terms of this Consent.
d. Neither the Sublease nor this Consent thereto shall release or discharge the
Sublessor from any liability under the Ground Lease. Sublessor shall remain liable and
responsible for the full performance and observance of all of the provisions, covenants and
conditions set forth in the Ground Lease on the part of Sublessor to be performed and observed.
Section 2. Joint Assumption of Obligations under the Sublease.
Sublessee, from and after the Effective Date, jointly assumes and agrees to perform and
fulfill certain of the terms, covenants, conditions and obligations of the Ground Lease to be
performed by Sublessor, as stated and identified as Assumed Obligations in the Sublease.
Section 3. Sublessor Covenants and Obligations.
Sublessor is and shall continue to be liable for all amounts that may be due Lessor as
permitted by and provided in the Ground Lease.
Section 4. Litigation Costs.
If any litigation between Sublessor and Sublessee arises out of this Consent or concerning
the meaning of interpretation of the Sublease, the losing party shall pay the prevailing party's
costs and expenses of this litigation, including, without limitation, reasonable attorney's fees.
Section 5. Acknowledgment by Lessor.
Lessor does hereby represent and warrant to Sublessee as follows:
A. Lessor is the owner of the fee simple estate in the Leased Premises and is the landlord
under the Ground Lease. Exhibit A is a true, correct and complete copy of the Ground
Lease and all amendments thereto.
B. The current quarterly rent payable under the terms of the Ground Lease is
$12,706.35.
C. The quarterly rent payable under the terms of the Ground Lease has been paid through
the date hereof.
D. Neither Lessor nor, to the best of Lessor's knowledge, Sublessor is in default of any of
the terms, conditions or covenants of the Lease, and to the best of Lessor's knowledge,
no condition exists which, with the giving of notice, the passage of time or both, would
constitute a default or event of default under the Lease.
E. The Ground Lease is in full force and effect, has not been modified or amended except
as set forth in Exhibit A, constitutes the only agreement between Lessor and Sublessor
with respect to the use or occupancy of the Leased Premises, and, to the knowledge
of Lessor, has not been previously assigned by Sublessor.
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Section 6. Successors and Assigns.
This Consent shall be binding on and inure to the benefit of the Parties to it, their heirs,
executors, administrators, successors in interest, and assigns.
Section 7. Governing Law.
This Consent shall be governed by and construed in accordance with California law and
Fresno County shall be the place of venue and jurisdiction respecting this Consent.
Section 8. Effective Date.
The effective date of this Consent shall be the date the Lessor consents to this Sublease
following the Sublessor's and Sublessee's complete execution of this Consent.
Section 9. Counterparts; Facsimile; Headings.
This Consent may be executed in counterparts, each of which shall be an original, but all
of which together shall constitute one agreement. This Consent may be executed via facsimile
with confirmation of transmission and followed by a hard copy via U.S. Mail. The headings to
sections of this Consent are for convenient reference only and shall not be used in interpreting
this Consent.
[Signatures follow on the next page.]
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The Parties have executed this Consent as of the date set forth next to their respective
signature.
SUBLESSOR:
NORTH GROVE BUSINESS PARK ASSOCIATION, INC.,
A California Corporation
By: ______________________________ Date: ______________________________
Printed Name: Janice Eischen Jepsen ___ Address:5100 N. 6th Street, Fresno, CA 93710
Ph: ( ) _____________________
By: ______________________________ Date: ______________________________
Printed Name: Ray Settle _____________ Address:5100 N. 6th Street, Fresno, CA 93710
Ph: ( ) _____________________
SUBLESSEE:
____________________________________________________________
By: ______________________________ Date: ______________________________
Printed Name: Mitchell Allee ___________ Address:3301 Deer Hollow Dr., Danville, CA 94506
Ph: ( ) _____________________
By: ______________________________ Date: ______________________________
Printed Name: Dorothea Allee __________ Address: 3301 Deer Hollow Dr., Danville, CA 94506
Ph: ( ) _____________________
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92573686765592844461
2/13/2024
5592846115 9257368676
2/13/2024
559-288-2613
2/13/2024
559-288-2613
2/14/2024
559-255-1688 559-255-1688
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CONSENT OF CITY TO SUBLEASE
The City of Fresno, through its Director of Aviation, consents to the Sublease to Sublessee of the
Agreement and Sublessee's assumption thereof, provided however that City does not release,
waive, relinquish, or compromise any rights under the Agreement against the original and the
current Sublessor and Sublessee. As noted above, the Sublessor shall also remain liable
respecting the obligations under the 2007 Land Lease and Agreement.
CITY OF FRESNO
A California municipal corporation
By: ______________________________ Date: _________________________________
Henry Thompson, A.A.E.,C.A.E.,IAP
Director of Aviation
APPROVED AS TO FORM:
Andrew Janz, City Attorney
By: ______________________________ Date: ______________________________
Brandon M. Collet
Assistant City Attorney
ATTEST:
Todd Stermer, CMC
City Clerk
By: ______________________________ Date: ______________________________
Deputy
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2/14/2024
2/14/2024
2/15/2024
EXHIBIT “A”
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LAND LEASE AGREEMENT
Between
CITY OF FRESNO, CALIFORNIA
A Municipal Corporation
And
North Grove Business Park Association, Inc.
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THIS LEASE is made and entered into this 2oth day of August, 2007, by and between
the CITY OF FRESNO, a municipal corporation ("LANDLORD"), and North Grove Business
Park Association, Inc., a California corporation ("TENANT").
This Lease replaces TENANT'S sublease or partial assignment under that lndustrial
Land Lease and Agreement executed by and between the City of Fresno and ATWOOD
GROVE CONSTRUCTION COMPANY, INC., which was recorded August 1, 1974, as document
number 57749 in Book 6330 at page 220 in the office of the County Recorder of the County of
Fresno. Said lndustrial Land Lease and Agreement was amended by Amendment to lndustrial
Land Lease and Agreement dated March 25, 1977, recorded March 29, 1977, as document
number 30743 in Book 6765 at page 859 in the office of the County Recorder of the County of
Fresno. Said lndustrial Land Lease and Agreement was further revised and amended in its
entirety dated May 30, 1978, and recorded June 23, 1978, as document number 68144 in Book
7059 at page 869 in said Revised and Amended lndustrial Land Lease and Agreement dated
May 30, 1978, and recorded on June 23, 1978, and is hereinafter referred to as "MASTER
LEASE", in that all right, title and interest existing as of the date hereof in the MASTER LEASE
has been assigned and conveyed to the LANDLORD. Tenant acknowledges that it has no other
claim, right or entitlement to the leased premises except under and pursuant to the terms of this
Lease.
ARTICLE I
DESCRIPTION OF LEASED PREMISES
LANDLORD hereby leases to TENANT and TENANT hereby hires from LANDLORD
that certain parcel of land situated in the City of Fresno, County of Fresno, State of California,
more particularly described as follows:
See attached Exhibit A
ARTICLE II
TERM
1. The term of the Lease shall be for a period commencing on September 1,2006
and ending December 31, 2044 unless sooner terminated as herein provided (hereinafter
referred to as "the basic term"). The LANDLORD reserves the right to terminate this Lease at
any time on or after December 31, 2037, if LANDLORD determines, in its sole and complete
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discretion, that the leased premises are needed for Airport purposes. If LANDLORD exercises
its rights under this Article I1 to terminate the Lease, it shall give TENANT 6 months written
notice.
ARTICLE Ill
RENT
1. TENANT shall pay the rent in advance, at the initial rate of nineteen (19) cents
per square foot per year, payable in quarterly installments, due on January 1, April 1, July 1 and
October 1 of each year. TENANT'S first payment shall be paid concurrent with the execution of
this LEASE and include rent at the above-referenced rate retroactive to September 1, 2006.
2. The Annual Rental will be adjusted effective each January 1 during the term
hereof by the average percentage increase, if any, of the following two indices:
(i) Average Hourly Earnings of Manufacturing Production or Non Supervisory Workers on
Private Nonfarm Payrolls, as published by the United States Department of Labor, Bureau of
Labor Statistics (USDLBLS), in the publication "Establishment Data, Historical Hours and
Earnings",; and
(ii) Producer Price Index for All Commodities, as published by the United States Department
of Labor, Bureau of Labor Statistics (USDLBLS), in the publication "Producer Price Indexes".
No one, annual rental adjustment shall result in a change in the Annual Rental greater than ten
percent (1 0%) compared to the then existing rental; however any excesses over the ten percent
(10%) maximum annual adjustments shall be merely deferred to the next annual adjustment
when it may be imposed without exceeding the ten percent (10%) maximum annual adjustment.
An example of the format and methodology used in the Rental Adjustment Procedure are
attached as Exhibit "B" hereto and incorporated herein by reference.
ARTICLE IV
UTlLlTl ES
TENANT shall pay for water, gas, electricity and other utilities supplied to and used on
the leased premises, and shall pay for sewerage, solid waste disposal and other utility services
to the leased premises.
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ARTICLE V
TAXES AND ASSESSMENTS
1. TENANT shall pay, when due and as the same become due and payable, but not
later than fifteen (15) days prior to the delinquency date thereof, all taxes and general and
special assessments of every description which during the term of this Lease may be levied
upon or assessed against the leased premises, any interest therein and improvements or other
property thereon, or possessory interest pertaining thereto, belonging to LANDLORD or its
successors. Any interest in real property which exists as a result of possession, exclusive use,
or a right to possession or exclusive use of land owned by the City of Fresno, and any
improvements thereon, is a taxable interest unless the possessor is exempt from taxation.
TENANT agrees to protect and hold harmless the LANDLORD, the leased land, and all interests
therein and improvements thereof from any and all such taxes and assessments, including any
interest, penalties and other expenses which may be thereby imposed, and from any lien
thereon or sale or other proceedings to enforce payment thereof. Notwithstanding anything to
the contrary herein contained, LANDLORD shall have the right to pay such tax (if payment is
required to avoid or terminate proceedings to enforce collection of such tax) and to recover the
same plus interest at ten (10%) percent per annum from TENANT.
ARTICLE VI
AND INSURANCE
1. for any loss, damage, or injury of any kind whatsoever
h
to the person or property of TENANT, or any of TENANT'S employees, guests or invitees or of
any other person whomsoever, caused by any use of the leased premises, or by any defect in
any building, structure, or other improvement constructed thereon, or arising from any accident
on said premises or any fire or other casualty thereon, or occasioned by the failure on the part
of TENANT to maintain said premises in safe condition, or by any nuisance made or suffered on
said premises, or by any act or omission of TENANT, or of TENANT'S employees, guests, or
invitees, or arising from any cause whatsoever; and TENANT hereby waives on its behalf all
claims and demands against LANDLORD for any such loss, damage, or injury of TENANT, and
hereby agrees to indemnify and save LANDLORD free and harmless from liability for any such
loss, damage, or injury of other persons, and from all costs, expenses and other charges arising
therefrom and in connection therewith.
2. TENANT agrees to acquire, within ten (10) days after the execution of this Lease,
and to keep in force during the term of this Lease and any extensions thereof, at TENANT'S
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expense, public liability insurance to protect against any liability to the public incidental to the
use of the leased premises or resulting from any accident occurring in or about the leased
premises.
3. The liability under such insurance shall be not less than $1,000,000 combined
single limit.
4. In the policy or policies providing such insurance, LANDLORD shall be named as
an additional insured, and said policy or policies shall contain a standard cross-liability
endorsement. Such insurance, as is afforded LANDLORD under the policy or policies, shall be
the primary coverage whether or not LANDLORD shall have other insurance against any loss
covered by said policy or policies.
5. The term of said policy or policies shall be for such period as designed by
TENANT; provided, however, that not less than thirty (30) days prior to the expiration of the term
of any such policy or policies, TENANT shall procure another policy or policies or a renewal of
the same policy or policies of said insurance so that throughout the entire basic term and any
extensions thereof, TENANT and LANDLORD shall be the named insureds under a policy of
comprehensive liability insurance as provided in this article.
6. TENANT shall furnish LANDLORD with a certificate of insurance for each such
policy, showing such insurance to be in full force and effect, stating that the insurance provided
is prior to any carried by the LANDLORD, and providing a minimum of ten (10) days written
notice to LANDLORD in the event of cancellation or material change in the terms of the policy.
7. TENANT agrees to reimburse LANDLORD for any increase in LANDLORD'S
property insurance premiums resulting directly from TENANT'S occupancy of the leased
premises. LANDLORD'S property insurance policies will include a waiver of subrogation clause
with respect to TENANT to the extent LANDLORD'S property insurance covers and applies to
the leased premises.
8. If TENANT does not keep the required insurance in full force and effect during
the term of this lease, LANDLORD may take out the necessary insurance and pay the premium
therefore; and TENANT shall, upon demand, pay LANDLORD, the amount of such premium
plus interest at the rate of ten (10%) percent per annum as additional rent due and payable to
LANDLORD.
ARTICLE VII
USE OF LEASED PREMISES
1. TENANT shall use the leased premises for purposes and such uses as are
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permissible under the zoning ordinances of the City of Fresno. TENANT shall not use or permit
any person to use the leased premises in such manner as to constitute any nuisance or to
violate any law, ordinance or regulation from time to time applicable thereto. At the time of
execution of this agreement, the leased premises is zoned MI -P.
ARTICLE Vlll
IMPROVEMENTS
1. Upon obtaining the approval of the Board of Architectural Review pursuant to the
provisions of Article XXVll hereof, TENANT may, at any time during the term of this Lease,
construct upon the leased premises all improvements and buildings as approved, with all
necessary fixtures and customary appurtenances. When the construction of any building or
other structure on said premises, or any addition thereto or alteration thereof as approved, is
commenced, the same shall be prosecuted with reasonable diligence until completed, and shall
conform to all laws, ordinances and regulations applicable thereto, and shall be constructed and
completed at the sole cost and expense of TENANT and without any cost, expense or liability to
the LANDLORD whatsoever.
2. Nothing in this article shall restrict the respective obligations and right of
TENANT and LANDLORD as provided for in Article XI and Article XIV herein.
ARTICLE IX
MAINTENANCE OF LEASED PREMISES
1. LANDLORD shall not be obligated to make any repairs, alterations, additions, or
improvements in or to or upon or adjoining the leased premises or any structure or other
improvement that thereafter may be constructed or installed thereon. TENANT shall, at all
times during the full term of this Lease and at its sole cost and expense, keep and maintain all
buildings, structures, and other improvements on said premises in good order and repair,
whether placed thereon by LANDLORD or TENANT, and TENANT shall, at its sole cost and
expense, keep and maintain the whole of said premises free of weeds and rubbish and in a
clean, sanitary and neat condition.
2. TENANT shall construct maintain and repair all facilities and other improvements
which may be required at any time by law, upon or adjoining or in connection with or for the use
of said premises or any part thereof, and TENANT shall make any and all additions to or
alterations in any buildings and structures on said premises which may be required by law and
shall otherwise observe and comply with any and all laws, ordinances, regulations, and orders
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of competent governmental authority applicable to said premises.
3. TENANT agrees to indemnify LANDLORD against any liability that may arise out
of TENANT'S failure to keep and maintain the leased premises and any buildings or other
improvements thereon as required by this article.
ARTICLE X
RESTORATION OF PREMISES
1. If, during the term of this Lease, any improvements constructed by TENANT on
the leased premises, or any part thereof, shall be damaged or destroyed by fire or other
casualty, TENANT shall, at its cost and expense either (a) repair or restore said improvements,
or (b) tear down and remove same from said premises. If TENANT shall elect to repair or
restore said improvements, the work thereon shall commence within one hundred fifty (150)
days after the damage occurs and shall be completed with due diligence.
2. If TENANT shall elect not to repair or restore said improvements, TENANT shall,
within one hundred fifty (150) days after said damage occurs, tear down and remove all parts
thereof remaining and the debris resulting from said fire or other casualty and otherwise clean
up said premises as hereinafter provided in Article XVI and any failure by TENANT to do so
shall constitute a breach of the covenants and conditions of this Lease.
3. Regardless of any such damage or destruction, this Lease shall continue in force
and effect until terminated as elsewhere provided in this Lease.
4. This article does not exempt the TENANT from the requirements of the State of
California Dangerous Building Ordinance or any other ordinance, law or regulation that may be
applicable.
ARTICLE XI
LIENS AND CLAIMS
1. TENANT shall not suffer or permit to be enforced against the title to the
LANDLORD'S leased premises, or any part thereof, or against the LANDLORD'S interest in the
leased premises, or any part thereof, any lien, claim or demand arising from any work of
construction, repair, restoration, maintenance or removal as herein provided or otherwise arising
(except liens, claims or demands suffered by arising from the actions of LANDLORD).
2. TENANT shall pay all such liens, claims and demands before any action is
brought to enforce the same against said land; and TENANT agrees to hold LANDLORD free
and harmless from all liability for any and all such liens, claims or demands, together with all
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costs and expenses in connection therewith.
3. LANDLORD shall have the right at any time to post and maintain on said
premises such notices as may be necessary to protect LANDLORD against liability for all such
liens and otherwise.
4. Should TENANT fail or refuse to pay any tax assessment or other charge upon
the leased premises when due and payable as provided herein, or any lien or claim arising out
of the construction, repairs, restoration, maintenance and use of said premises and the building
and improvements thereon, or any other claim, charge or demand which TENANT has agreed
to pay under the covenants of this Lease, and if after thirty (30) days written notice from
LANDLORD to TENANT and to his authorized encumbrancer, if any, TENANT or his said
encumbrancer shall fail or refuse to pay and discharge the same, then LANDLORD may, at its,
option, either treat such failure or refusal as a breach of or default under this Lease, or may pay
any such tax assessment, lien, claim, charge or demand, or settle or discharge any action
therefore or judgment thereon, and all costs, expenses and other sums incurred or paid by
LANDLORD in connection therewith shall be repaid to LANDLORD, by TENANT upon written
demand, together with interest thereon at the rate of ten (10%) percent per annum from the date
of payment until repaid, and any default in such repayment shall constitute a breach of the
covenants of this Lease.
ARTICLE XI1
ASSIGNMENT AND SUBLETTING
1. TENANT may not encumber, sublease, assign or otherwise transfer this Lease,
or any right or interest herein, without the prior written consent of LANDLORD,
2. Any and all sublessees, assignees or transferees shall first covenant in writing,
with copies thereof to be furnished to LANDLORD to keep, perform and be bound by each and
all of the covenants and conditions of this Lease herein provided to be kept and performed by
TENANT, and to assume any obligations hereunder previously accrued with respect to the
leased premises.
3. Should TENANT attempt to make, or suffer to be made, any such sublease,
assignment or transfer without such prior written covenant by any and all sublessees,
assignees, or transferees, as specified in Section 2 of this Article, or should any right or interest
of TENANT hereunder be transferred or sold by or under Court or legal process, or otherwise,
then any of the foregoing events shall be deemed a breach of the conditions and restrictions of
this lease and thereupon LANDLORD may, at its option, terminate this Lease forthwith by
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written notice thereof to TENANT, or exercise other rights provided by law, or in this Lease, to
be exercisable by LANDLORD in the event of any default or breach under this Lease.
4. TENANT shall not encumber, assign, sublet or otherwise transfer this Lease, or
any right or interest herein, if TENANT is in default at such time in any respect.
ARTICLE Xlll
RIGHT TO ENCUMBER LEASEHOLD INTEREST
1. Notwithstanding anything to the contrary hereinabove contained in Article XII,
TENANT shall have the right at any time and from time to time to subject the leasehold estate,
to a deed or deeds of trust; PROVIDED THAT the note for which the deed of trust has been
given as security will be discharged prior to the expiration of the basic term of this Lease.
Any such deed of trust shall, nevertheless, be subject to the following covenants and
conditions, each and all of which shall be binding upon and inure to the benefit of the
encumbrance and its transferee(s), to-wit:
a) Except as herein otherwise provided, the trust deed, and all rights
acquired there under, shall be subject to each and all of the covenants, conditions and
restrictions set forth in this Lease and to all rights and interests of LANDLORD
hereunder;
b) Should there be any conflict between the provisions of this Lease and the
provisions of the trust deed, the former shall control;
c) Should this Lease be encumbered for the purpose of construction,
TENANT may:
1) obtain a construction loan for the purpose of erecting a building
and other improvements;
2) obtain a long term loan for the purpose of paying off the
construction loan;
3) obtain a loan from a bonafide lending institution;
4) TENANT shall provide such security, bond or other guarantee as
such lender may require for the encumbrances hereinabove enumerated;
5) in the event such construction, subject to this section (l)(c) of this
Article XIII, once commenced is not completed, and no other party shall be found
to be responsible for completing or removing same, TENANT shall at the written
request of LANDLORD be responsible for completing, said construction or, at
option, removing the partially completed improvements at such time as TENANT
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shall have the lawful ability to do so. TENANT shall exercise due diligence in
securing the legal right to enter upon the premises for this purpose.
d) if the leasehold estate of TENANT shall be transferred at foreclosure sale
under the trust deed, such transfer shall not require the prior written consent of
LANDLORD or, be subject to the payment of any transfer fee, but the purchaser at such
sale shall pay or cure any prior defaults or breaches to prevent exercise by the
LANDLORD of the rights given by this Lease or by law to the LANDLORD in the event of
default or breach. Any further and subsequent transfer or assignment of this Lease shall
be subject to he provisions of Article XII.
e) LANDLORD agrees that it will not terminate this Lease because of any
default of the TENANT if the holder of the trust deed, within ninety (90) days after
service of written notice of LANDLORD'S intention to terminate this Lease for such
default or breach, shall:
1) cure such default or breach by the payment or expenditure of
money, or, if such default or breach is not so curable, commence foreclosure
proceedings within said ninety (90) day period and thereafter diligently pursue
such proceedings to completion pursuant to the trust deed; and
2) keep and perform all of the covenants and conditions of said
Lease requiring expenditure of money by the TENANT until such time as said
leasehold shall be sold upon foreclosure pursuant to the trust deed or shall be
released or reconveyed thereunder; provided, however, that if the holder of the
trust deed shall fail or refuse to comply with any and all of the conditions of this
subdivision, then and thereupon LANDLORD shall be released from the
covenant of forbearance herein contained; and any notice to the encumbrancer
provided for in this subdivision may be given concurrently with or after
LANDLORD'S notice of default to TENANT as hereinafter provided in Article XIV.
9 Upon recording the trust deed, TENANT, at its expense, shall cause to be
recorded in the office of the County Recorder of Fresno County, California, a written
request executed and acknowledged by LANDLORD for a copy of any subsequent
notice of default or any notice of sale under the trust deed as provided by the statutes of
the State of California relating thereto.
g) TENANT shall furnish to LANDLORD a complete copy of the trust deed
and note secured thereby, together with the name and address of the encumbrancer.
2. TENANT'S sublessees may encumber their interests by trust deed if permitted by
DocuSign Envelope ID: F517B61A-F05C-4156-989A-C4F165EA5787
TENANT, and the holders of any such trust deeds shall have the rights of the sublessees, upon
foreclosure, as provided in Section 5 of Article XI1 and in Section 5 of Article XIV.
ARTICLE XIV
DEFAULT
1. Should TENANT default in the performance of, or breach any covenant,
condition, or restriction of the Lease, and should such default or breach continue uncured for a
period of ninety (90) days from and after written notice thereof given by LANDLORD to
TENANT, then LANDLORD shall have the following rights, without additional demand and
without prejudice to any other right or remedy of LANDLORD.
a) LANDLORD may terminate the Lease by giving TENANT written notice
thereof or by re-entering upon and taking possession of the leased premises and all
buildings and improvements thereon and removing all persons claiming under subleases
(subject to the provisions of Section 5 of Article XII), and all personal property, from the
leased premises, and such personal property may be removed and stored in a public
warehouse or elsewhere at the cost of and for the account of TENANT; or
b) LANDLORD may continue this Lease in effect for so long as the
LANDLORD does not terminate the TENANT's right to possession, and the LANDLORD
may enforce all its rights and remedies under this Lease. For the purpose of this
election, the following do not constitute a termination of the TENANT's right to
possession:
1) Acts of maintenance or preservation or efforts to relet the
property;
2) The appointment of a receiver upon initiative of the LANDLORD to
protect the LANDLORD'S interest under the Lease.
2. Except as otherwise provided in subdivision (b) of Section 1 of this Article XIV, if
the TENANT breaches this Lease and abandons the leased premises before the end of the term
or if the TENANT's right of possession is terminated by the LANDLORD because of a breach of
this Lease, the Lease, other than the payment of rent, terminates.
3. Nothing in Section 1 of this article affects the right of LANDLORD to equitable
relief where such relief is appropriate.
4. (a) Nothing in this article affects the provisions of Chapter 4 (commencing
with Section 1159) of Title 3 of Part 3 of the California Code of Civil Procedure, relating to
actions for unlawful detainer, forcible entry, and forcible detainer.
DocuSign Envelope ID: F517B61A-F05C-4156-989A-C4F165EA5787
(b) The bringing of an action under the provisions of Chapter 4 (commencing
with Section 1159) of Title 3, Part 3 of the California Code of Civil Procedures does not
affect the LANDLORD'S right to bring a separate action for relief under provisions of this
article, but no damages shall be recovered in the subsequent action for any detriment for
which a claim for damages was made and determined on the merits in the previous
action.
5. Notwithstanding the provisions of paragraph 1 and 2 of this article, any sublease
of TENANT hereunder shall continue in effect so long as the sublessees of TENANT hereunder
complies with the obligations of such TENANT under the provisions of its sublease with
TENANT hereunder.
ARTICLE XV
EMINENT DOMAIN
1. In the event of any taking of all or any part of the leased premises or any interest
therein by reason of any exercise of the power of eminent domain, or any transfer of all or any
part of the leased premises or any interest therein made in avoidance of any exercise of the
power of eminent domain (all of the foregoing being hereinafter referred to as "taking"), prior to
or during the term of this Lease, the rights and obligations of LANDLORD and TENANT with
respect to such taking shall be as provided in this article.
2. In the event of a taking of all of the leased premises, this Lease shall terminate
as of the date of the taking. However, the LANDLORD hereby agrees to use the income
approach to determine the fair market value of the leasehold interest. Furthermore, LANDLORD
and TENANT agree that a 5.25 capitalization rate shall be applied to the income approach.
3. In the event of a taking of less than all of the leased premises, this Lease shall
continue in full force and effect except as provided in this section. The leased premises shall be
reduced by the area of any land taken. Rent shall be reduced, but all other obligations of
TENANT shall terminate as to any land taken. The leased premises shall not be reduced by any
taking except a taking of land. But in case of any taking, TENANT shall keep the amount of just
compensation, including severance damages, plus interest, costs of court, and any other
amounts that may be paid for taking any interest of TENANT, provided that just compensation
shall not exceed the proportion that TENANT'S interest bears to the value of the undivided fee, If
the taking shall substantially impair the use of the leased premises by TENANT, then in such
case, TENANT shall have the right to terminate this Lease. Any such termination shall be made
by written notice from TENANT to LANDLORD on or before thirty (30) days after the date of the
DocuSign Envelope ID: F517B61A-F05C-4156-989A-C4F165EA5787
taking and shall be effective as of the date of the taking; and all future obligations of the
TENANT, other than rent, shall terminate.
4. Notwithstanding any provision of this Lease to the contrary, in the event that a
taking of all or any part of the leased premises shall affect only the interest of TENANT, the
entire award made with respect to the taking shall be paid to TENANT and this Lease shall
continue in full force and effect subject to the taking.
5. The "date of the taking," as used in this article, means the date the governmental
entity has a right to possession or the date of action possession, whichever is earlier.
6. Any compensation which would otherwise be payable under this paragraph to
TENANT shall be paid directly to any encumbrancer of the leasehold interest, to the extent of
such encumbrance.
ARTICLE XVI
REMOVAL
1. Upon the expiration or termination of this Lease, LANDLORD shall have the right,
at TENANT'S sole cost and expense, to require TENANT to remove from the leased premises
all buildings and other improvements placed thereon by TENANT, except subdivision
improvements, within one hundred and eighty (180) days prior to the expiration or termination
of this Lease, and TENANT shall fill all excavations and remove all foundations, debris and
other parts of said buildings remaining after same are removed and shall surrender possession
of said premises to LANDLORD in a clean and orderly condition. No buildings or improvements
shall be removed at any other time without the prior written consent of LANDLORD. In the event
LANDLORD does not exercise such right, TENANT, with the written consent of LANDLORD
shall have the same right, but only upon the condition that TENANT shall not then be in default
under any of the covenants and conditions hereof, and not otherwise.
2. In the event any buildings and other improvements shall not be removed as
provided in Section 1, the same shall become and thereafter remain a part of the land leased
and shall belong to LANDLORD without the payment of any consideration therefore.
3. Upon the expiration of the term hereof, or any sooner termination of this Lease,
TENANT shall execute, acknowledge and deliver to LANDLORD a prior instrument in writing
releasing and quitclaiming to LANDLORD ail right, title and interest of TENANT in and to the
leased premises by virtue of this Lease or otherwise.
ARTICLE XVll
DocuSign Envelope ID: F517B61A-F05C-4156-989A-C4F165EA5787
HOLDING OVER
1. This Lease shall terminate and become null and void without further notice upon
the expiration of the term herein specified, and any holding over by the TENANT after the
expiration of said term shall not constitute a renewal hereof or give TENANT any rights
hereunder or in or to the leased premises, except as otherwise provided in Article XVI hereof.
Any such holding over shall be deemed solely a tenancy from month to month, subject to all the
terms and conditions of this Lease, with rental payable in case at the then current rate, in
advance on the first day of each and every calendar month during the period of such holding
over, provided that this requirement shall not pertain to the removal permitted by Article XVI, if
the same is done entirely in accordance with the said Article XVI.
ARTICLE XVlll
INTERFERENCE WITH AIRPORT OPERATIONS
1. LANDLORD owns and operates the Fresno Yosemite International Airport in and
upon which the leased premises are located.
2. There is reserved to the LANDLORD, its successors and assigns, for the use and
benefit of the public, a right of flight for the passage of aircraft in the airspace above the surface
of the premises herein conveyed, together with the right to cause in said airspace such noise as
may be inherent in the operation of aircraft, now known or hereafter used for navigation of or
flight in the air, using said airspace for landing at, taking off from, or operating on the Fresno Air
Terminal.
3. TENANT, his successors and assigns, shall not erect nor permit the erection of
any structures, or permit the growth of any trees on the leased premises which would be an
airport hazard within the standards established by Part 77 of the Federal Aviation Regulations
as now existing or s may hereafter be modified.
4. TENANT, his successors and assigns, shall not engage in or conduct or permit
the conduct of any activity of any kind on the leased premises which will interfere in any manner
with the operation of the Fresno Air Terminal as an airport or with aircraft operations or related
operations conducted on the airport by LANDLORD, and shall not make use of said leased
premises in any manner which might interfere with the landing and taking off of aircraft from said
Fresno Air Terminal, or otherwise constitute an airport hazard.
5. TENANT, in the operations to be conducted pursuant to the terms of this
Agreement, and otherwise upon the leased premises, shall not, on the grounds of race, color,
sex or national origin, discriminate or permit the discrimination against any person or persons in
DocuSign Envelope ID: F517B61A-F05C-4156-989A-C4F165EA5787
any manner prohibited by the Civil Rights Act of 1964 or amendments thereto, or violate any
other rules or regulations enacted by agencies having control over the leased premises.
6. TENANT acknowledges that the leased premised may be subject to current and
possible future requirement and/or directives of the Federal Aviation Administration adlor the
Transportation Security Administration, and any successor of either. TENANT agrees to abide
by and keep any and all such requirements and/or directives.
ARTICLE XIX
REPRESENTATIONS
1. TENANT covenants and agrees that it has examined the leased premises and
that the same is delivered to it in good order and condition and that the same is delivered to it
good order and condition and that no representations as to said premises have been made by
LANDLORD or by any person or agent acting for LANDLORD and it is agreed that this
document contains the entire agreement between the parties hereto and that there are no
verbal agreements, representations, warranties or other understandings affecting the same.
ARTICLE XX
BANKRUPTCY OR INSOLVENCY
1. If at any time TENANT files bankruptcy, or a petition for reorganization or
arrangement under any of the laws of the United States relating to bankruptcy shall be filed by
or against TENANT, and shall not be dismissed within thirty (30) days from the date of such
filing, or if the assets of TENANT or the business conducted by TENANT on the premises shall
be assumed by any trustee or other person pursuant to any judicial proceedings, or if TENANT
becomes insolvent, or fails in business, or makes an assignment for the benefit of creditors, or if
TENANT'S property is seized pursuant to any writ of attachment or execution or proceedings
whereby a lien is placed upon any of the assets of TENANT and the same is not dismissed
within thirty (30) days therefrom, the occurrence of any such event may, at LANDLORD'S option,
be construed as a material breach of this Lease.
ARTICLE XXI
UNDERTAKINGS OF TENANT WHICH ARE CONSIDERATIONS HEREIN
1. TENANT shall comply with the covenants and restrictions applicable to the
leased premises and referred to a "Tract Restrictions".
DocuSign Envelope ID: F517B61A-F05C-4156-989A-C4F165EA5787
ARTICLE XXll
WAIVER OF BREACH OF COVENANTS
1. The waiver by LANDLORD of any breach of any term, covenant or condition
herein contained shall not be deemed to be a waiver of such term, covenant, or condition or any
subsequent breach of the same or any other term, covenant, or condition herein contained. The
exercise of any right or option or privilege hereunder by LANDLORD shall not exclude
LANDLORD from exercising any and all other rights, privileges, and options hereunder, and
LANDLORD'S failure to exercise any right, option or privilege hereunder shall not be deemed a
waiver of said right, option or privilege, nor shall it relieve TENANT from TENANT'S obligation to
perform each and every covenant and condition on TENANT'S part to be performed hereunder,
nor from damages or other remedy for failure to perform or meet the obligations of this Lease.
ARTICLE XXlll
VENUE AND LITIGATION
1. Exclusive venue in any and all actions arising under this Lease shall be Fresno
County, California.
ARTICLE XXlV
NOTICES
1. All notices or demand of any kind which LANDLORD may be required to serve
on TENANT under the terms of this Lease may be served upon TENANT (as an alternative to
personal service upon TENANT) by mailing a copy thereof by registered or certified mail, return
receipt requested, addressed to TENANT at
North Grove Business Park Association, Inc.
2727 N. Grove Industrial Dr. #I51
Fresno CA 93727
Attn: President
Or at such other place as TENANT may designate to LANDLORD in writing.
2. All notices or demands of any kind which TENANT may be required or may
desire to serve upon LANDLORD under the terms of this Lease may be served upon
LANDLORD (as an alternative to personal service upon LANDLORD) by mailing a copy thereof
by registered or certified mail, return receipt requested, addressed to LANDLORD:
City of Fresno - Department of Aviation
4995 East Clinton Way
DocuSign Envelope ID: F517B61A-F05C-4156-989A-C4F165EA5787
Fresno, CA 93727
Attn: Director
Or at such other place as LANDLORD may designate to TENANT in writing.
3. In the event of any service by mail, as aforesaid, service shall be deemed to be
complete upon execution of the return receipt.
ARTICLE XXV
CONSTRUCTION AND EFFECT
1. Each and all of the obligations, covenants, conditions and restrictions of this
Lease shall be deemed as running with the land and shall inure to the benefit of and be binding
upon and enforceable against, as the case may require, the successors and assigns of
LANDLORD, and subject to the restrictions of Article XI1 hereof, the heirs, executors, legal
representatives, encumbrances, assignees, successors and subtenants of TENANT.
2. If TENANT consists of more than one person, the covenants and obligations of
TENANT hereunder shall be the joint and several covenants and obligations of such persons. In
this Lease, the masculine gender includes the feminine neuter, and the singular number
includes the plural, whenever the context so requires.
3. The headings contained herein are used only for the purpose of convenience and
shall not be deemed to limit the subject of the articles hereof or to be considered in the
construction thereof. The principal divisions of this Lease are designated as "articles" and are
identified consecutively by Roman numerals. The principal divisions of articles are designated
as "sections" and are identified consecutively by Arabic numerals not in parenthesis. The
principal divisions of sections are designated as "subdivisions" and are identified consecutively
by lower case letters in parenthesis. Divisions of subdivisions are designated as "paragraphs"
and are identified consecutively by Arabic numerals in parenthesis. References to codified
California statues include amendments and any superseding statutes which may be in effect at
the time the rights of any party arise there under.
DocuSign Envelope ID: F517B61A-F05C-4156-989A-C4F165EA5787
ARTICLE XXVl
BOARD OF ARCHITECTURAL REVIEW
1. No improvements, except subdivision improvements, shall be erected on the
leased premises until plans and specifications indicating structural design, conformity and
harmony with neighboring properties and a positive impact on the Fresno Air Terminal and
environment are submitted in sufficient detail to provide for an in-depth review by a Board of
Architectural Review. Said Board of Architectural Review shall be comprised of the Aviation
Director of LANDLORD (or his successor in function), a representative of TENANT, and a
responsible private citizen to be appointed by the aforementioned representatives of
LANDLORD and TENANT.
2. No construction shall commence on any leased premises until such plans and
specifications have been approved in writing by said Board of Architectural Review.
3. Approval by the Board of Architectural Review shall not be in lieu of a Conditional
Use Permit, Site Plan Special Permit, or ay other entitlement required by police power
regulation.
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IN WITNESS WHEREOF, the parties hereto have executed this Lease the day and year
first above written.
CITY OF FRESNO, a Municipal Corporation
By: %
Name: Russell C. ~Kmar, AAE
Title: Director of Aviation
LANDLORD
APPROVED AS TO FORM
James C. Sanchez
City Attorney
City of Fresno
By: '?-+I 6-07
i~e~ut~) $1.1
ATTEST
Rebecca A. Klisch
City Clerk
City of Fresno
0
By:
North Grove Business Park Association,
Inc.
By: b'13w$!/w
&hx*v J. LrP /
Print name: PtA
Title: &M
TENANT
DocuSign Envelope ID: F517B61A-F05C-4156-989A-C4F165EA5787
SS.
Countyof
On bep b , 2007, before me, y[elsCZ% ( A. &Y=,
Notary Public, 'personally appeared SW-k 1 . IL?~ l
knem-bme (or proved to me on ihe bases of satisfhdtory evidence) to be the
- -
person@ whose namewe subscribed to the within instrument and acknowledged
to me that ,l@&@~~ executedthe same in &l~rl~ir authorized capacity(-, and
that by &l~/Bejr signaturemon the instrument the person(q or the entity upon
behalf of which the persorf@acted, executed the instrument.
WITNESS my hand and official seal.
. -
d--i
- (Seal)
DocuSign Envelope ID: F517B61A-F05C-4156-989A-C4F165EA5787
EXHIBIT A
PAGE ONE
Parcel One:
Lot 1 of Tract No 3039, in the City of Fresno, County of Fresno, State of California, according to
the map thereof recorded in Book 33 at page 39 and 40 of Plats, Fresno County Records.
Parcel Two:
Lot 2 of Tract No 3039, in the City of Fresno, County of Fresno, State of California, according to
the map thereof recorded in Book 33 at page 39 and 40 of Plats, Fresno County Records.
Parcel Three:
Lot 3 of Tract No 3039, in the City of Fresno, County of Fresno, State of California, according to
the map thereof recorded in Book 33 at page 39 and 40 of Plats, Fresno County Records.
Parcel Four:
Lot 4 of Tract No 3039, in the City of Fresno, County of Fresno, State of California, according to
the map thereof recorded in Book 33 at page 39 and 40 of Plats, Fresno County Records.
Parcel Five:
Lot 5 of Tract No 3039, in the City of Fresno, County of Fresno, State of California, according to
the map thereof recorded in Book 33 at page 39 and 40 of Plats, Fresno County Records.
Parcel Six:
Lot 6 of Tract No 3039, in the City of Fresno, County of Fresno, State of California, according to
the map thereof recorded in Book 33 at page 39 and 40 of Plats, Fresno County Records.
Parcel Seven:
Lot 7 of Tract No 3039, in the City of Fresno, County of Fresno, State of California, according to
the map thereof recorded in Book 33 at page 39 and 40 of Plats, Fresno County Records.
Parcel Eight:
Lot 8 of Tract No 3039, in the City of Fresno, County of Fresno, State of California, according to
the map thereof recorded in Book 33 at page 39 and 40 of Plats, Fresno County Records.
Parcel Nine:
Lot 9 of Tract No 3039, in the City of Fresno, County of Fresno, State of California, according to
the map thereof recorded in Book 33 at page 39 and 40 of Plats, Fresno County Records.
CONTINUED
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EXIBIT A
PAGE TWO
Parcel Ten:
Lot 10 of Tract No 3039, in the City of Fresno, County of Fresno, State of California, according to
the map thereof recorded in Book 33 at page 39 and 40 of Plats, Fresno County Records.
Parcel Eleven:
Lot 1 1 of Tract No 3039, in the City of Fresno, County of Fresno, State of California, according to
the map thereof recorded in Book 33 at page 39 and 40 of Plats, Fresno County Records.
Parcel Twelve:
Lot 12 of Tract No 3039, in the City of Fresno, County of Fresno, State of California, according to
the map thereof recorded in Book 33 at page 39 and 40 of Plats, Fresno County Records.
Parcel Thirteen:
An undivided 1112~ lease hold interest in and to all that portion of Lot 13 of Tract No 3039 as
shown and defined as "Common Area" on said Subdivision Map.
Total of all Parcels is 174,000 square feet.
DocuSign Envelope ID: F517B61A-F05C-4156-989A-C4F165EA5787
- -- AlOTE --- SUBDIVIDED LAND IN POR. SEC. 30, T 13 S., R. 21 E., M. D. s. a M. Gx Rota Afi
T3h. -p,h for A-n? purpovs only- C- m
PU~POEBC of zoning or subdivision IRE
I I I
I
E. BROWN AVE. NOTE .' I. I - LOT N COMPRISES AAEAS #T lNbU4ED IN TNE NUWERW LOTS
AND COrJSTINTES AN EdSWDJt AhV RM- OF-WAY FOR
PUBLIC VTIUTIES, EXCLUDING SEWERS AND WATW ACCESS
2- EPCH SHALL^ ASBXRATEYOWNWUNIT
COMMON AREA
MID A PR0-m lNTm IN THE WMW ARE4
n* esu- ga- iH '
CITY a= CRY OF
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/'-;~RHL AIRK '.\ssessor's A No. 3039, Plat Bk. 33, Pgs. 39 18 40 ( Fi. ,ease Purposes)
Caunty ot
DocuSign Envelope ID: F517B61A-F05C-4156-989A-C4F165EA5787
ANNUAL RENTAL ADJUSTMENT COMPUTATION FOR THE PERIOD: JANUARY 1,2008 THROUGH DECEMBER 31,2008
1
NAME OF LESSEE: NORTH GROVE BUSINESS PARK ASSOCIATION, INC. RE: LEASE DATED: AUGUST 20,2007
AIRPORT CONCERNED: FRESNO YOSEMlTE INTERNATIONAL AIRPORT PREMISES: LOTS444 OF TRACT 2653
4-13 303
~U.S. DEPT. OF LABOR. BUREAU OF LABOR STATISTICS DATA USED IN THIS COMPUTATION I
I I LAST I CURRENT I DIFFERENCE I PERCENT
DATE COMPUTATION COMPLETED: 8120107 7:30 AM
INDEX
- 11
PPI
21 -
AHE
LAVERAGE PERCENTAGE INCREASEIDECREASE (l.e., 112 of above 'TOTAL?: I 3.1086%]
TOTAL: (PPI PERCENT INCREASEIDECREASE +I- AHE PERCENT INCREASEDECREASE):
BASE YEAR
I2006]
157.3
16.56
6.2172%
EFFECTIVE DATE
OF RATE SHOWN:
FOOTNOTES
(1) Producer Price Index (ALL COMMODITIES)
(1982=1 WYo).
(2) Average Hourly Earnings of Production or Non-
Supervisory Workers (On Private Non-Agricultural Payrolls) In
Manufacturing.
(3) Pursuant to the Rental Adjustment provisions of the Lease
IN NO EVENT SHALL ANY INCREASE BE IN AN AMOUNT
GREATER THAN TEN PERCENT (10%) OF THE RENTAL FOR
THE PRIOR YEAR.
(4) As a result of "rounding", the actual annual rental amount
to be paid by Lessee may diier slightly from "Computed Annual
Rental."
ADJUSTMENT
YEAR
0
157.30
16.56
J:\FYhTenant Files\North Grow Business Park Asso. (Atwood Grove)\RA - Rental Adjustment Master Form
PREMISES
LAND &
IMPROVEMENTS
EXHIBIT "B"
PAGE I OF 1
ADJUSTMENT
YEAR
0
164.80
16.80
PER SQUARE FOOT RATES
SQUARE FEET
174,000.00 $0.190000
BASE RATE
January 1,2007
COMPUTED ANNUAL RENT:
EFFECTIVE DATE: January 1,2008
BETWEEN LAST
AND CURRENT
ADJ. YR. INDEX
7.5000
0.2400
BASED ON
THE NEW
PER SQ. FT.
RATE SHOWN
$0.190M)O
EXISTING
RATE
January I, 2007
BASED ON 10%
MAX. ALLOWED
CHANGE IN
SQ. FT. RATE
QUARTERLY
RENTAL: $8,521.91
INCR.IDECR.
LAST VS. CURR
ADJ. YR. INDEX
4.7680%
1.4493%
$0.195906
COMPUTATION COMPLETED BY: CITY OF FRESNWIRPORTS
4995 E. Clinton Way
FRESNO, CA 93727
TELEPHONE: (559) 621-4500
- 31
NEW RATE
January I, 2008
ANNUAL -41
RENTAL:
% CHANGE
BETWEEN NEW
AND EXISTING
SQ. FT. RATE
3.1084%
$34,087.64 NEW PER SQ. W. RATE
$34,087.64 $36,366.00
DocuSign Envelope ID: F517B61A-F05C-4156-989A-C4F165EA5787