Commercial Lease Agreement

COMMERCIAL LEASE AGREEMENT

State of California

TABLE OF CONTENTS

1. Basic Lease Information (Summary of Terms)
2. Definitions
3. Premises; Condition; Delivery
4. Term; Commencement; Holdover
5. Lease Type Election and Rent Structure
6. Base Rent; Rent Escalation
7. Additional Rent — Operating Expenses, CAM, and Taxes
8. Percentage Rent (Retail Tenants)
9. Security Deposit
10. Use of Premises; Exclusive Use
11. CASp Inspection Disclosure and ADA Compliance
12. Tenant Improvements and Work Letter
13. Alterations by Tenant
14. Maintenance and Repair Obligations
15. Assignment and Subletting
16. Insurance Requirements
17. Indemnification; Waiver of Subrogation
18. Environmental Provisions
19. Signs and Exterior Modifications
20. Parking
21. Default and Remedies
22. Condemnation
23. Casualty and Restoration
24. Personal Guaranty
25. Estoppel Certificates
26. Subordination, Non-Disturbance, and Attornment (SNDA)
27. Options (Renewal, Expansion, Right of First Refusal)
28. Dispute Resolution
29. General Provisions
30. SB 1103 Compliance (Qualified Commercial Tenants)
31. Execution
32. Exhibits

1. BASIC LEASE INFORMATION (SUMMARY OF TERMS)

2. DEFINITIONS

For purposes of this Commercial Lease Agreement ("Lease"), the following terms shall have the meanings set forth below. Defined terms used in the singular include the plural and vice versa.

"ADA" means the Americans with Disabilities Act of 1990, 42 U.S.C. § 12101 et seq., as amended, including the ADA Amendments Act of 2008, and any successor statute, together with all regulations and guidelines promulgated thereunder.

"Additional Rent" means all monetary obligations of Tenant under this Lease other than Base Rent, including without limitation Operating Expenses, Taxes, CAM Charges, Insurance Costs, Utility Charges, Late Charges, Percentage Rent (if applicable), and any other sums payable by Tenant.

"Alterations" means any alterations, additions, improvements, or modifications to the Premises, whether structural or non-structural.

"Base Rent" means the fixed monthly rental amount specified in Section 6, subject to adjustment as provided herein.

"Base Year" means the calendar year [____], which shall serve as the baseline for Operating Expense escalation calculations.

"Building" means the building in which the Premises are located, including all common areas, mechanical systems, and appurtenances.

"Building Operating Costs" has the meaning assigned in Cal. Civ. Code § 1950.9 (as added by SB 1103).

"CAM Charges" means Common Area Maintenance Charges, as more particularly defined in Section 7.

"CASp" means a Certified Access Specialist as defined in Cal. Civ. Code § 55.52.

"Commencement Date" means the date specified in Section 1 or such date as established pursuant to the provisions of Section 4.

"Common Areas" means all areas and facilities outside the Premises and within the exterior boundaries of the Property that are provided and designated by Landlord for the general non-exclusive use of tenants, their employees, agents, and invitees, including without limitation driveways, sidewalks, parking areas, landscaped areas, loading docks, hallways, lobbies, elevators, stairways, restrooms, and trash enclosures.

"Environmental Laws" means all applicable federal, state, and local laws, statutes, regulations, ordinances, orders, and directives relating to the protection of the environment or human health, including without limitation CERCLA (42 U.S.C. § 9601 et seq.), RCRA (42 U.S.C. § 6901 et seq.), the California Hazardous Waste Control Law (Cal. Health & Safety Code § 25100 et seq.), and Proposition 65 (Cal. Health & Safety Code § 25249.5 et seq.).

"Event of Default" means any of the acts or omissions described in Section 21.1.

"Hazardous Materials" means any substance, material, waste, pollutant, or contaminant that is listed, defined, or regulated as hazardous, toxic, or dangerous under any Environmental Law, including without limitation petroleum and petroleum derivatives, asbestos and asbestos-containing materials, polychlorinated biphenyls (PCBs), mold, lead-based paint, and radon.

"Landlord Indemnitees" means Landlord, its affiliates, property manager, mortgagee(s), and their respective partners, members, shareholders, officers, directors, employees, and agents.

"Lease Year" means each consecutive twelve (12)-month period beginning on the Commencement Date (or anniversary thereof), except that if the Commencement Date is not the first day of a calendar month, the first Lease Year shall include the partial month plus the following twelve (12) full months.

"Operating Expenses" means all costs and expenses incurred by Landlord in connection with the ownership, operation, management, maintenance, and repair of the Property and the Common Areas, as more particularly described and limited in Section 7.

"Premises" means the space described in Section 3, together with all fixtures and improvements therein.

"Property" means the real property on which the Building is located, including all improvements, structures, parking areas, and Common Areas, as more particularly described in Exhibit A.

"Qualified Commercial Tenant" has the meaning assigned under SB 1103 (Cal. Civ. Code § 1946.8), including microenterprises (five or fewer employees), restaurants with fewer than ten employees, and nonprofit organizations with fewer than twenty employees.

"Rentable Square Feet" or "RSF" means the rentable area of the Premises as measured in accordance with the Building Owners and Managers Association (BOMA) International Standards (ANSI/BOMA Z65.1-2017 or successor standard).

"Taxes" means all real property taxes, general and special assessments, supplemental assessments, and other governmental charges levied against the Property, together with any fees, costs, or expenses incurred by Landlord in contesting or appealing the same.

"Tenant's Proportionate Share" means the percentage set forth in Section 1, calculated by dividing the Rentable Square Feet of the Premises by the total Rentable Square Feet of the Building.

"Usable Square Feet" or "USF" means the usable area of the Premises as measured in accordance with BOMA International Standards.

3. PREMISES; CONDITION; DELIVERY

3.1 Grant of Lease.
Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, the Premises described as follows:

• Street Address: [________________________________]
• Suite/Unit: [________________________________]
• Rentable Square Feet: [________________________________] RSF
• Usable Square Feet: [________________________________] USF
• Floor(s): [________________________________]

The Premises are more particularly described and depicted in Exhibit A attached hereto and incorporated herein by this reference.

3.2 Common Areas and Appurtenant Rights.
Together with the Premises, Tenant shall have the non-exclusive right, in common with Landlord and other tenants and occupants of the Building, to use the Common Areas for their intended purposes, subject to the Rules and Regulations attached hereto as Exhibit E and such reasonable modifications as Landlord may adopt from time to time.

3.3 Measurement Disputes.
If Tenant disputes the stated Rentable Square Feet or Usable Square Feet, Tenant may, at Tenant's sole cost, retain a licensed architect to re-measure the Premises in accordance with BOMA Standards within sixty (60) days after the Commencement Date. If the architect's measurement differs from the stated RSF by more than two percent (2%), Landlord and Tenant shall adjust the Base Rent, Tenant's Proportionate Share, and Security Deposit accordingly, retroactive to the Commencement Date.

3.4 Condition of Premises.
(a) Except as expressly set forth in Exhibit B (Work Letter), Tenant accepts the Premises in their current "AS IS" condition, subject to all applicable zoning and municipal regulations, covenants, conditions, and restrictions of record, and the existing state of the title.

(b) Landlord represents and warrants that, as of the Commencement Date: (i) the Building's structural elements, roof, foundation, and base building mechanical, electrical, plumbing, and life-safety systems shall be in good working order and condition; and (ii) the Common Areas shall comply in all material respects with applicable Laws, including the ADA.

4. TERM; COMMENCEMENT; HOLDOVER

4.1 Initial Term.
The initial term of this Lease (the "Initial Term") shall commence on the Commencement Date and shall expire at 11:59 p.m. on the Expiration Date specified in Section 1, unless sooner terminated or extended in accordance with the provisions hereof.

4.2 Early Access.
Tenant shall have the right to access the Premises [____] days prior to the Commencement Date for the purpose of installing fixtures, equipment, cabling, and furnishings ("Early Access Period"), provided that (a) Tenant shall not conduct business from the Premises during the Early Access Period, (b) Tenant shall not interfere with Landlord's completion of any Landlord Work, (c) Tenant's insurance obligations under Section 16 shall be in effect during the Early Access Period, and (d) Tenant shall not be obligated to pay Base Rent during the Early Access Period (but shall be responsible for utilities consumed).

4.3 Commencement Date Confirmation.
Within thirty (30) days after the Commencement Date, Landlord and Tenant shall execute and deliver a Commencement Date Memorandum in the form of Exhibit F, confirming the actual Commencement Date, the Expiration Date, and the commencement of Tenant's rent obligations.

4.4 Delayed Delivery.
If Landlord is unable to deliver possession of the Premises by the anticipated Commencement Date, this Lease shall not be void or voidable, and Landlord shall not be liable for any loss or damage resulting therefrom; provided, however, that (a) the Commencement Date and Expiration Date shall be extended day-for-day for each day of such delay, and (b) if delivery has not occurred within [____] days after the anticipated Commencement Date, Tenant may terminate this Lease by written notice delivered within ten (10) days thereafter, in which event the Security Deposit and any prepaid Rent shall be returned to Tenant.

4.5 Holdover.
(a) Any holding over by Tenant after the expiration or earlier termination of this Lease without Landlord's prior written consent shall constitute a tenancy at sufferance on a month-to-month basis.

(b) During such holdover, Tenant shall pay monthly rent equal to:

☐ One hundred fifty percent (150%) of the Base Rent in effect immediately prior to expiration for the first [____] months, increasing to two hundred percent (200%) thereafter
☐ [____] percent ([____]%) of the then-current Base Rent

plus all applicable Additional Rent.

(c) Tenant shall indemnify, defend, and hold harmless Landlord from and against all claims, damages, losses, and liabilities (including consequential damages suffered by Landlord, such as lost rent from a successor tenant) arising from or related to Tenant's holdover.

(d) No acceptance of rent by Landlord during a holdover period shall be deemed a consent to continued holdover or the creation of a new tenancy.

5. LEASE TYPE ELECTION AND RENT STRUCTURE

5.1 Lease Type.
The parties elect the following lease structure (check one):

☐ Triple Net Lease (NNN): Tenant shall pay Base Rent plus Tenant's Proportionate Share of all Operating Expenses, Taxes, Insurance Costs, and CAM Charges as Additional Rent. This Lease is intended to be an absolute net lease, and Landlord shall receive Base Rent free and clear of all charges, costs, and expenses related to the Property, except as expressly stated herein.

☐ Gross Lease (Full Service): Tenant shall pay Base Rent only. Landlord shall be responsible for all Operating Expenses, Taxes, Insurance Costs, and CAM Charges, provided that Tenant shall pay its Proportionate Share of increases in Operating Expenses and Taxes above the Base Year.

☐ Modified Gross Lease: Tenant shall pay Base Rent plus the following specified categories of Additional Rent (check all that apply):
- ☐ Tenant's Proportionate Share of Taxes
- ☐ Tenant's Proportionate Share of Insurance
- ☐ Tenant's Proportionate Share of CAM Charges
- ☐ Utility charges for the Premises
- ☐ Janitorial services for the Premises
- ☐ Other: [________________________________]

5.2 Rent Commencement.
Tenant's obligation to pay Base Rent shall commence on [__/__/____] (the "Rent Commencement Date").

5.3 Rent Abatement.
☐ Not applicable.
☐ Provided that no Event of Default has occurred and is continuing, Landlord shall abate [________________________________] of Base Rent for the period commencing on [__/__/____] and ending on [__/__/____] (the "Abatement Period"). The abated amount shall total $[________________________________]. If an Event of Default occurs during the Term, all unamortized abated rent shall become immediately due and payable.

6. BASE RENT; RENT ESCALATION

6.1 Base Rent.
Tenant shall pay to Landlord, without prior demand, offset, deduction, or abatement (except as expressly provided herein), monthly Base Rent as follows:

6.2 Payment Terms.
(a) Base Rent shall be payable in advance on or before the first (1st) day of each calendar month during the Term by (check one):

☐ Check payable to [________________________________] at [________________________________]
☐ Wire transfer to account designated by Landlord
☐ ACH transfer to account designated by Landlord
☐ Electronic payment platform: [________________________________]

(b) If the Commencement Date falls on a day other than the first day of a calendar month, Base Rent for such partial month shall be prorated on a per diem basis (annual Base Rent divided by 365) and shall be paid on the Commencement Date.

6.3 Rent Escalation.
Beginning with the second Lease Year and on each anniversary of the Rent Commencement Date thereafter, Base Rent shall be adjusted as follows (check one):

☐ Fixed Increase: Base Rent shall increase by [____]% per annum over the immediately preceding Lease Year's Base Rent.

☐ CPI Adjustment: Base Rent shall be adjusted annually based on the percentage increase in the Consumer Price Index for All Urban Consumers (CPI-U), Los Angeles-Long Beach-Anaheim, CA (or the closest applicable metropolitan area), as published by the U.S. Bureau of Labor Statistics. The adjustment shall be calculated as follows:
- Comparison months: [________________________________] to [________________________________]
- Minimum annual increase (floor): [____]%
- Maximum annual increase (cap): [____]%
- If the CPI ceases to be published, the parties shall mutually agree upon a comparable index.

☐ Fair Market Value: At the commencement of Lease Year [____] and every [____] Lease Year(s) thereafter, Base Rent shall be adjusted to the then-prevailing fair market rental value for comparable commercial space in the vicinity of the Premises, determined in accordance with the appraisal process set forth in Section 27.

6.4 Late Charges; Interest.
(a) If any installment of Base Rent or Additional Rent is not received by Landlord within five (5) days after the date when due, Tenant shall pay to Landlord a late charge equal to five percent (5%) of the overdue amount as liquidated damages and not as a penalty, the parties acknowledging that the actual damages from late payment are difficult to ascertain.

(b) In addition to the late charge, all amounts past due shall bear interest from the original due date until paid at the lesser of (i) ten percent (10%) per annum, or (ii) the maximum rate permitted by applicable law.

(c) Notwithstanding the foregoing, Landlord shall waive the late charge for the first (1st) late payment in any twelve (12)-month period, provided Tenant remits full payment within ten (10) days after written notice from Landlord.

7. ADDITIONAL RENT — OPERATING EXPENSES, CAM, AND TAXES

7.1 Operating Expenses Defined.
"Operating Expenses" shall include all costs and expenses incurred by Landlord in connection with the ownership, operation, management, maintenance, and repair of the Property, including without limitation:

(a) Real property taxes, assessments (general and special), supplemental tax bills, and any tax levied in lieu thereof;
(b) Property and casualty insurance premiums;
(c) CAM Charges (as defined in Section 7.2);
(d) Utilities serving the Common Areas;
(e) Property management fees (not to exceed [____]% of gross rental income);
(f) Landscaping and grounds maintenance;
(g) Security services;
(h) Janitorial services for Common Areas;
(i) Repairs and maintenance to the Building structure, roof, exterior walls, parking areas, and Common Areas;
(j) Capital improvements required by governmental regulations enacted after the Commencement Date or that are reasonably expected to reduce Operating Expenses, amortized over their useful life with interest at [____]% per annum;
(k) License, permit, and inspection fees;
(l) Accounting and auditing fees related to Operating Expense reconciliation; and
(m) Reasonable legal fees incurred in connection with Property operations (excluding tenant disputes).

7.2 CAM Charges.
"CAM Charges" shall include all costs of maintaining, repairing, and operating the Common Areas, including without limitation parking lot maintenance (resurfacing, restriping, sweeping), landscaping, exterior lighting, elevator maintenance, trash removal, pest control, signage maintenance, storm drainage, and snow/ice removal (if applicable).

7.3 Operating Expense Exclusions.
Operating Expenses shall not include:

(a) Costs of tenant improvements or build-outs for any tenant;
(b) Leasing commissions, advertising costs, and tenant inducements;
(c) Depreciation of the Building (but amortization of permitted capital expenditures is not excluded);
(d) Mortgage payments, ground lease payments, or debt service of any kind;
(e) Landlord's income, franchise, inheritance, estate, gift, or transfer taxes;
(f) Costs to correct latent defects in the Building's original construction;
(g) Costs attributable to Landlord's negligence or willful misconduct;
(h) Costs to remediate Hazardous Materials existing on the Property prior to the Commencement Date or caused by Landlord or other tenants;
(i) Fines, penalties, or interest resulting from Landlord's failure to comply with Laws;
(j) Costs of art, sculptures, or other decorative items;
(k) Executive salaries above the level of property manager;
(l) Costs of services provided to other tenants but not to Tenant; and
(m) Any costs for which Landlord is reimbursed by insurance, condemnation awards, or warranty claims.

7.4 Tenant's Proportionate Share.
Tenant shall pay Tenant's Proportionate Share of Operating Expenses as Additional Rent. Tenant's Proportionate Share is [________________________________]%, calculated as: Rentable Square Feet of Premises ([________________________________] RSF) / Total Rentable Square Feet of Building ([________________________________] RSF).

7.5 Estimated Payments and Reconciliation.
(a) Prior to the commencement of each calendar year (or partial calendar year), Landlord shall deliver to Tenant a written estimate of Operating Expenses for the upcoming year and Tenant's Proportionate Share thereof. Tenant shall pay one-twelfth (1/12) of the estimated annual amount on the first day of each month, concurrently with Base Rent.

(b) Within one hundred twenty (120) days after the end of each calendar year, Landlord shall deliver to Tenant a reasonably detailed statement of actual Operating Expenses for the preceding year ("Reconciliation Statement"). If Tenant's payments exceeded Tenant's actual Proportionate Share, Landlord shall credit the overpayment against the next installment(s) of Additional Rent due (or refund the amount if the Lease has expired). If Tenant's payments were less than the actual amount, Tenant shall pay the deficiency within thirty (30) days after receipt of the Reconciliation Statement.

7.6 Audit Rights.
(a) Tenant or its authorized representative shall have the right, at Tenant's sole cost, upon thirty (30) days' prior written notice and during normal business hours, to examine and audit Landlord's books and records relating to Operating Expenses for a period of twelve (12) months following Tenant's receipt of the Reconciliation Statement.

(b) If the audit reveals that Tenant was overcharged by more than five percent (5%), Landlord shall reimburse Tenant for the reasonable cost of the audit, in addition to the overpayment amount plus interest at the rate specified in Section 6.4.

(c) The audit right shall be exercised no more than once per calendar year and shall be conducted by a certified public accountant (not compensated on a contingency-fee basis).

7.7 CAM Cap (Optional).
☐ Not applicable.
☐ Controllable Operating Expenses (defined as all Operating Expenses other than Taxes, Insurance, Utilities, and costs imposed by governmental regulations) shall not increase by more than [____]% per annum over the prior calendar year's Controllable Operating Expenses on a cumulative, compounding basis.

8. PERCENTAGE RENT (RETAIL TENANTS)

8.1 Percentage Rent Obligation.
☐ Not applicable — delete this Section 8.
☐ In addition to Base Rent and Additional Rent, Tenant shall pay to Landlord Percentage Rent calculated as set forth below.

8.2 Breakpoint and Rate.
(a) "Natural Breakpoint" means the annual Base Rent divided by the Percentage Rent Rate.
(b) "Percentage Rent Rate" means [____]% of Gross Sales in excess of the Breakpoint.
(c) "Breakpoint" means: ☐ Natural Breakpoint ☐ Artificial Breakpoint of $[________________________________] per Lease Year.

8.3 Gross Sales Defined.
"Gross Sales" means the aggregate amount of all sales, services, and revenues of every kind generated from or attributable to business conducted at, from, or through the Premises, whether for cash, credit, or barter, excluding: (a) returns and allowances; (b) sales or excise taxes collected and remitted to governmental authorities; (c) transfers of merchandise between Tenant's stores for purposes other than sale; (d) insurance proceeds; and (e) sales of trade fixtures.

8.4 Reporting and Payment.
(a) Within thirty (30) days after the end of each calendar month, Tenant shall deliver to Landlord a written statement of Gross Sales for such month. Percentage Rent shall be paid monthly to the extent Gross Sales for the Lease Year to date exceed the prorated Breakpoint for such period.

(b) Within ninety (90) days after the end of each Lease Year, Tenant shall deliver an annual statement of Gross Sales certified by an officer of Tenant. Any underpayment shall be paid within thirty (30) days; any overpayment shall be credited against the next installment(s) of Percentage Rent due.

8.5 Landlord's Audit Right.
Landlord shall have the right, upon reasonable notice and at Landlord's cost, to audit Tenant's Gross Sales records. If the audit reveals an understatement of more than three percent (3%), Tenant shall pay the cost of the audit in addition to the deficiency.

8.6 Continuous Operations.
Tenant shall continuously operate its business in the Premises during regular business hours throughout the Term, unless prevented by Force Majeure.

9. SECURITY DEPOSIT

9.1 Amount.
Concurrently with Tenant's execution of this Lease, Tenant shall deposit with Landlord the sum of $[________________________________] (the "Security Deposit") as security for the faithful performance by Tenant of all obligations under this Lease.

9.2 Application.
(a) If Tenant fails to pay Rent or other charges when due, or otherwise defaults in any obligation under this Lease, Landlord may (but shall not be obligated to) use, apply, or retain all or any portion of the Security Deposit for the payment of any Rent or other amount then due and unpaid, or for payment of any other loss or damage that Landlord may suffer by reason of Tenant's default.

(b) If Landlord so applies any portion of the Security Deposit, Tenant shall, within ten (10) business days after written demand, deposit with Landlord the amount necessary to restore the Security Deposit to its full original amount.

9.3 Form of Security Deposit.
☐ Cash deposit
☐ Irrevocable standby letter of credit issued by a financial institution acceptable to Landlord, in the form attached as Exhibit G
☐ Other: [________________________________]

9.4 Reduction.
Provided that no Event of Default has occurred and no Event of Default is then continuing, the Security Deposit shall be reduced as follows:
☐ Not applicable — no scheduled reduction.
☐ On the [____] anniversary of the Commencement Date, the Security Deposit shall be reduced to $[________________________________].

9.5 Return.
Subject to Cal. Civ. Code § 1950.7, Landlord shall return any unapplied portion of the Security Deposit to Tenant within thirty (30) days after the later of (a) termination of this Lease and Tenant's vacation and surrender of the Premises in the condition required hereunder, or (b) receipt by Landlord of Tenant's forwarding address.

9.6 Waiver of Section 1950.7.
To the extent permitted by applicable law, Tenant hereby waives the provisions of Cal. Civ. Code § 1950.7 and agrees that Landlord may apply the Security Deposit to any monetary or non-monetary default by Tenant, including but not limited to damages for future rent as set forth in Cal. Civ. Code § 1951.2.

9.7 Transfer of Security Deposit.
Landlord may transfer the Security Deposit to any successor in interest to the Property, and upon such transfer, Landlord shall be released from all liability for the return of the Security Deposit, and Tenant shall look solely to such successor for its return.

10. USE OF PREMISES; EXCLUSIVE USE

10.1 Permitted Use.
The Premises shall be used solely for [________________________________] (the "Permitted Use") and for no other purpose without Landlord's prior written consent, which consent shall not be unreasonably withheld, conditioned, or delayed.

10.2 Prohibited Uses.
In no event shall the Premises be used for: (a) any purpose that violates applicable Laws or insurance requirements; (b) any purpose that creates a nuisance or emits unreasonable noise, vibration, or odor; (c) storage or disposal of Hazardous Materials except as expressly permitted in Section 18; (d) any use that would increase the fire insurance rate for the Building above the rate in effect for the Permitted Use; or (e) any use prohibited by the CC&Rs encumbering the Property.

10.3 Exclusive Use (If Applicable).
☐ Not applicable.
☐ Landlord covenants that during the Term, Landlord shall not lease any other space in the Building or Property to any tenant for the following use: [________________________________]. If Landlord breaches this exclusive use covenant, Tenant's remedies shall include: (a) injunctive relief; (b) a reduction of Base Rent to [____]% of the stated amount during the period of the breach; or (c) termination of this Lease if the breach continues for more than [____] days after written notice.

10.4 Compliance with Laws.
Tenant shall, at Tenant's sole cost and expense, comply with all applicable federal, state, and local statutes, codes, ordinances, regulations, permits, and orders (collectively, "Laws"), including without limitation: (a) the ADA; (b) California Building Standards Code (Title 24); (c) Cal. Civ. Code § 1938 (CASp disclosures); (d) all Environmental Laws; (e) fire and life-safety codes; and (f) all zoning and land use regulations applicable to Tenant's use.

10.5 Rules and Regulations.
Tenant shall comply with the Rules and Regulations promulgated by Landlord from time to time for the orderly operation of the Property, attached hereto as Exhibit E, provided that such Rules and Regulations are: (a) reasonable; (b) uniformly enforced against all tenants; and (c) not materially inconsistent with the terms of this Lease. In the event of a conflict between this Lease and the Rules and Regulations, this Lease shall control.

11. CASp INSPECTION DISCLOSURE AND ADA COMPLIANCE

11.1 CASp Disclosure (Cal. Civ. Code § 1938).

(a) Landlord represents that, as of the date of this Lease (check one):

☐ CASp Inspection Completed — Premises Determined to Meet Accessibility Standards. The Premises [have/have not] been inspected by a CASp and [have/have not] been determined to meet all applicable construction-related accessibility standards pursuant to Cal. Civ. Code § 55.53. A copy of the CASp inspection report is attached hereto as Exhibit C.

☐ CASp Inspection Completed — Premises Determined Not to Meet All Accessibility Standards. The Premises have been inspected by a CASp and have been determined not to meet all applicable construction-related accessibility standards. A copy of the CASp inspection report is attached hereto as Exhibit C, and a compliance schedule is included.

☐ No CASp Inspection Performed. The Premises have not been inspected by a Certified Access Specialist (CASp). A Certified Access Specialist (CASp) can inspect the subject premises and determine whether the subject premises comply with all of the applicable construction-related accessibility standards under state law. Although state law does not require a CASp inspection of the subject premises, the commercial property owner or lessor may not prohibit the lessee or tenant from obtaining a CASp inspection of the subject premises for the occupancy or potential occupancy of the lessee or tenant, if requested by the lessee or tenant. The parties shall mutually agree on the arrangements for the time and manner of the CASp inspection, the payment of the fee for the CASp inspection, and the cost of making any repairs necessary to correct violations of construction-related accessibility standards within the premises.

11.2 CASp Inspection Report — Delivery Timing.
(a) If a CASp inspection has been performed, Landlord shall deliver a copy of the CASp report to Tenant not later than forty-eight (48) hours prior to execution of this Lease.

(b) If the report is not provided at least forty-eight (48) hours prior to execution, Tenant shall have the right to rescind this Lease by written notice delivered within seventy-two (72) hours after execution.

(c) Within seven (7) days after execution of this Lease, Landlord shall provide Tenant with a copy of the disability access inspection certificate and any other inspection reports relating to the Premises.

11.3 CASp Inspection at Tenant's Request.
If no CASp inspection has been performed, and Tenant requests a CASp inspection:

(a) Cost: ☐ Landlord shall pay ☐ Tenant shall pay ☐ The parties shall share equally the cost of the CASp inspection.

(b) Repairs: The cost of making any repairs to correct violations of construction-related accessibility standards identified in the CASp report shall be allocated as follows:

☐ Landlord shall bear the cost of all such repairs (default presumption under Cal. Civ. Code § 1938(d)).
☐ Landlord shall bear the cost of repairs to Common Areas and Building structure; Tenant shall bear the cost of repairs within the Premises.
☐ Other: [________________________________]

11.4 ADA Compliance Allocation.
(a) Landlord's ADA Obligations. Landlord shall be responsible for ADA compliance with respect to (i) the Common Areas, (ii) the Building exterior and parking areas, (iii) restrooms serving multiple tenants, and (iv) the structural elements of the Building (including path-of-travel improvements triggered by Landlord's alterations).

(b) Tenant's ADA Obligations. Tenant shall be responsible for ADA compliance within the Premises, including without limitation (i) ensuring that Tenant's layout, design, and operations comply with ADA requirements; (ii) providing accessible counters, workstations, and fixtures within the Premises; and (iii) path-of-travel improvements triggered by Tenant's Alterations.

(c) Mutual Cooperation. The parties shall cooperate in good faith to address any ADA compliance issues that span both Landlord's and Tenant's areas of responsibility.

(d) Third-Party Claims. Notwithstanding the foregoing allocation, both Landlord and Tenant acknowledge that either party may be named as a defendant in ADA claims brought by third parties. Each party's indemnification obligations under Section 17 shall apply to ADA claims arising from the indemnifying party's area of responsibility as allocated in this Section 11.4.

12. TENANT IMPROVEMENTS AND WORK LETTER

12.1 Landlord's Work.
☐ Not applicable — Premises delivered "AS IS."
☐ Landlord shall perform the work described in the Work Letter attached hereto as Exhibit B ("Landlord's Work") at Landlord's sole cost and expense.
☐ Landlord shall provide a Tenant Improvement Allowance as described in Section 12.2.

12.2 Tenant Improvement Allowance.
☐ Not applicable.
☐ Landlord shall provide Tenant with an improvement allowance of $[________________________________] ($[________________________________] per RSF) (the "TI Allowance") toward the cost of Tenant's improvements to the Premises ("Tenant Improvements"), subject to the following:

(a) The TI Allowance shall be applied to the costs of design, permitting, construction, and installation of Tenant Improvements, including architectural and engineering fees, permit fees, and construction costs.

(b) Tenant shall submit plans and specifications for Tenant Improvements to Landlord for approval, which approval shall not be unreasonably withheld, conditioned, or delayed. Landlord shall respond within [____] business days after receipt of complete plans.

(c) Tenant Improvements shall be constructed in accordance with approved plans, all applicable Laws (including Title 24 and the ADA), and the construction requirements set forth in Exhibit B.

(d) If the cost of Tenant Improvements exceeds the TI Allowance, Tenant shall be solely responsible for the excess cost.

(e) Any unused portion of the TI Allowance shall be: ☐ forfeited ☐ applied as a credit against Base Rent ☐ paid to Tenant in cash.

(f) The TI Allowance shall be disbursed within [____] days after Tenant's delivery to Landlord of (i) a certificate of occupancy or equivalent governmental approval, (ii) unconditional lien waivers from all contractors and subcontractors, and (iii) as-built drawings.

12.3 Construction Standards.
All Tenant Improvements and Landlord's Work shall be performed: (a) in a good and workmanlike manner; (b) in compliance with all Laws; (c) using only licensed, bonded, and insured contractors approved by Landlord (such approval not to be unreasonably withheld); and (d) in a manner that does not unreasonably interfere with other tenants' use of the Building.

12.4 Mechanic's Liens.
Tenant shall keep the Premises free from any mechanic's lien, materialman's lien, or similar lien arising from Tenant Improvements or Alterations. If any such lien is recorded, Tenant shall, within twenty (20) days after notice from Landlord, cause such lien to be released of record by payment, bonding, or other means acceptable under California law.

13. ALTERATIONS BY TENANT

13.1 Landlord Consent Required.
Tenant shall not make any Alterations to the Premises without Landlord's prior written consent, which consent shall not be unreasonably withheld, conditioned, or delayed; provided, however, that:

(a) Minor Alterations. Cosmetic Alterations that do not affect the Building's structure, mechanical systems, or exterior appearance and that do not exceed $[________________________________] in cost in any twelve (12)-month period may be made without Landlord's consent (but with prior written notice to Landlord).

(b) Structural Alterations. Any Alteration affecting the Building's structure, roof, exterior, or base building systems shall require Landlord's consent, which may be withheld in Landlord's sole and absolute discretion.

13.2 Construction Requirements.
All Alterations shall be performed: (a) in a good and workmanlike manner; (b) in compliance with all Laws, including Title 24, the ADA, and fire codes; (c) using only licensed, insured contractors approved by Landlord; and (d) at times and in a manner that minimizes disruption to other tenants and Building operations.

13.3 Ownership and Removal.
(a) All Alterations (other than Tenant's trade fixtures, furniture, and removable personal property) shall, upon installation, become the property of Landlord and shall remain upon and be surrendered with the Premises upon expiration or termination of this Lease.

(b) Notwithstanding the foregoing, Landlord may, at the time of granting consent to any Alteration, designate any Alteration as a "Required Removal Item." At the expiration or earlier termination of this Lease, Tenant shall remove all Required Removal Items and restore the affected areas to their pre-Alteration condition.

14. MAINTENANCE AND REPAIR OBLIGATIONS

14.1 Landlord's Maintenance Obligations.
Landlord shall maintain in good order, condition, and repair:
(a) The Building's structural elements, including the foundation, exterior load-bearing walls, structural columns and beams, and the roof structure (but excluding the roof membrane in NNN leases);
(b) Building base systems, including elevators, fire-life-safety systems, central HVAC serving Common Areas, electrical service to the Building main panel, and main plumbing lines;
(c) The Common Areas, including parking lots, sidewalks, landscaping, exterior lighting, and signage;
(d) The Building exterior, including painting, facade maintenance, and window washing; and
(e) Any latent defects in the original construction of the Building.

14.2 Tenant's Maintenance Obligations.
Tenant shall, at Tenant's sole cost and expense, maintain in good order, condition, and repair:
(a) The interior of the Premises, including interior walls, ceilings, floor coverings, doors, windows, glass, and interior finishes;
(b) HVAC equipment exclusively serving the Premises, including regular maintenance and filter replacement per manufacturer specifications;
(c) Plumbing fixtures and connections within the Premises;
(d) Electrical fixtures and wiring within the Premises;
(e) All Tenant Improvements and Alterations; and
(f) Tenant's trade fixtures, furniture, equipment, and personal property.

14.3 HVAC Maintenance Contract.
Tenant shall, at Tenant's sole cost, maintain a preventive maintenance contract for all HVAC equipment exclusively serving the Premises with a licensed HVAC contractor approved by Landlord. Tenant shall deliver a copy of such contract to Landlord within thirty (30) days after the Commencement Date and shall provide evidence of renewal annually.

14.4 Landlord's Right to Perform.
If Tenant fails to perform any maintenance obligation within fifteen (15) days after written notice from Landlord (or immediately in the case of emergency), Landlord may perform such maintenance at Tenant's cost, plus a ten percent (10%) administrative fee. Such amounts shall constitute Additional Rent and shall be due within thirty (30) days after Landlord's invoice.

14.5 Surrender Condition.
Upon expiration or earlier termination of this Lease, Tenant shall surrender the Premises in good order, condition, and repair, ordinary wear and tear and casualty damage excepted, with all Required Removal Items removed and the affected areas restored.

15. ASSIGNMENT AND SUBLETTING

15.1 Landlord's Consent Required.
Tenant shall not, without the prior written consent of Landlord (which consent shall not be unreasonably withheld, conditioned, or delayed), directly or indirectly: (a) assign this Lease or any interest herein; (b) sublease all or any portion of the Premises; (c) mortgage, pledge, or hypothecate this Lease or any interest herein; or (d) permit any change in control of Tenant (collectively, a "Transfer").

15.2 Standards for Consent.
Landlord may consider, among other factors, the following in determining whether to grant consent: (a) the financial condition and creditworthiness of the proposed transferee; (b) the proposed transferee's business reputation and experience; (c) the proposed use and its compatibility with the Building; (d) the proposed transferee's compliance with applicable Laws; and (e) the impact on the Building's tenant mix and exclusive use provisions.

15.3 Transfer Notice and Required Information.
Tenant shall submit to Landlord a written request for consent at least thirty (30) days prior to the proposed effective date of any Transfer, together with: (a) the identity and legal structure of the proposed transferee; (b) current financial statements and tax returns for the past three (3) years; (c) a description of the proposed transferee's business and intended use; (d) a copy of the proposed assignment or sublease agreement; and (e) any other information reasonably requested by Landlord.

15.4 Landlord's Response.
Within twenty (20) business days after receipt of all required information, Landlord shall: (a) consent to the Transfer; (b) withhold consent, specifying the reasonable basis therefor in writing; or (c) exercise the recapture right described in Section 15.6.

15.5 Profit Sharing.
If Landlord consents to a Transfer and the transferee pays rent or other consideration in excess of the Rent payable under this Lease (after deducting Tenant's reasonable transaction costs, including brokerage commissions, legal fees, tenant improvement costs, and any free rent period), Tenant shall pay to Landlord [____]% of such excess ("Transfer Premium"). For sublettings, the Transfer Premium shall be calculated on the portion of the Premises subleased.

15.6 Recapture Right.
☐ Not applicable.
☐ In lieu of consenting to a proposed assignment of this Lease (or a sublease of fifty percent (50%) or more of the Premises for substantially all of the remaining Term), Landlord may elect to terminate this Lease (or, in the case of a sublease, the portion of the Premises subject to the sublease) by written notice to Tenant within the response period specified in Section 15.4. If Landlord exercises the recapture right, this Lease (or the applicable portion) shall terminate on the proposed effective date of the Transfer.

15.7 Permitted Transfers.
Notwithstanding Section 15.1, the following Transfers shall not require Landlord's consent (but shall require prior written notice to Landlord and assumption of all lease obligations by the transferee): (a) assignment to a parent, subsidiary, or affiliate that controls, is controlled by, or is under common control with Tenant; (b) assignment to a successor entity resulting from a merger, consolidation, or reorganization; or (c) assignment to a purchaser of all or substantially all of Tenant's assets; provided, in each case, that: (i) the net worth of the transferee immediately following the Transfer is at least equal to the net worth of Tenant immediately prior to the Transfer, and (ii) the transferee assumes in writing all obligations of Tenant under this Lease.

15.8 No Release.
No Transfer, whether or not consented to by Landlord, shall release Tenant from any liability under this Lease unless Landlord expressly agrees in writing to such release. Each assignee shall be deemed to have assumed all obligations of Tenant under this Lease.

16. INSURANCE REQUIREMENTS

16.1 Tenant's Insurance.
Throughout the Term, Tenant shall, at Tenant's sole cost, procure and maintain the following insurance:

(a) Commercial General Liability ("CGL") Insurance: With limits of not less than $[________________________________] per occurrence and $[________________________________] in the aggregate, insuring against claims for bodily injury, personal injury, death, and property damage occurring in or about the Premises. Such policy shall include (i) broad form contractual liability, (ii) premises and operations coverage, (iii) products and completed operations coverage, and (iv) Landlord, Landlord's property manager, and Landlord's mortgagee(s) as additional insureds.

(b) Property Insurance: Covering Tenant's personal property, trade fixtures, inventory, and Alterations, written on an "all risk" or "special form" basis, in an amount not less than one hundred percent (100%) of replacement cost.

(c) Business Interruption Insurance: Covering loss of income and continuing expenses for a period of not less than twelve (12) months.

(d) Workers' Compensation Insurance: As required by applicable California law (Cal. Labor Code § 3700 et seq.), including employer's liability with limits of not less than $[________________________________] per occurrence.

(e) Commercial Automobile Liability Insurance (if vehicles are used in connection with Tenant's business): With a combined single limit of not less than $[________________________________].

(f) Umbrella / Excess Liability Insurance: With limits of not less than $[________________________________] in excess of the underlying CGL and automobile liability policies.

16.2 Landlord's Insurance.
Landlord shall maintain throughout the Term:
(a) Property insurance on the Building (excluding Tenant's personal property and Alterations) on an "all risk" or "special form" basis in an amount equal to the full replacement cost of the Building;
(b) Commercial General Liability Insurance with limits not less than those customary for similar commercial properties in the market area; and
(c) Such other insurance as Landlord's mortgagee may require.

16.3 Insurance Standards.
All insurance required to be maintained by Tenant shall be: (a) written by carriers licensed to do business in California with an A.M. Best rating of A-VII or better; (b) primary and non-contributory with respect to Landlord's insurance; (c) written on an occurrence form (not claims-made); and (d) provide for at least thirty (30) days' prior written notice to Landlord of cancellation or material change.

16.4 Certificates of Insurance.
Tenant shall deliver to Landlord certificates of insurance and applicable endorsements: (a) prior to the Commencement Date; (b) not less than fifteen (15) days prior to the expiration of any policy; and (c) promptly upon request by Landlord.

17. INDEMNIFICATION; WAIVER OF SUBROGATION

17.1 Tenant's Indemnification.
Tenant shall indemnify, defend (with counsel reasonably acceptable to Landlord), and hold harmless the Landlord Indemnitees from and against any and all claims, demands, actions, damages, losses, liabilities, judgments, costs, and expenses (including reasonable attorneys' fees and court costs) arising out of or related to: (a) the use or occupancy of the Premises by Tenant or any person claiming by, through, or under Tenant; (b) any act, omission, or negligence of Tenant, its agents, employees, contractors, or invitees; (c) Tenant's breach of any term of this Lease; or (d) the presence, release, or threatened release of Hazardous Materials caused or permitted by Tenant.

17.2 Landlord's Indemnification.
Landlord shall indemnify, defend, and hold harmless Tenant from and against any and all claims, demands, actions, damages, losses, liabilities, judgments, costs, and expenses (including reasonable attorneys' fees) arising out of or related to: (a) Landlord's negligence or willful misconduct; (b) Landlord's breach of any term of this Lease; or (c) Hazardous Materials existing on the Property prior to the Commencement Date or introduced by Landlord or its agents.

17.3 Waiver of Subrogation.
To the fullest extent permitted by law, Landlord and Tenant each waive any right of recovery against the other party (and their respective officers, directors, partners, members, employees, agents, and mortgagees) for any loss or damage to the extent such loss or damage is covered (or would have been covered had the required insurance been maintained) by the waiving party's property insurance policies. Each party shall obtain from its insurer a waiver-of-subrogation endorsement or clause permitting the foregoing waiver.

17.4 Limitation of Liability.
(a) Notwithstanding anything to the contrary contained herein, in no event shall either party be liable to the other for any consequential, incidental, special, punitive, or exemplary damages arising out of or related to this Lease, except in connection with: (i) third-party claims subject to indemnification; (ii) fraud or willful misconduct; (iii) Tenant's holdover pursuant to Section 4.5; or (iv) Environmental Claims under Section 18.

(b) The aggregate liability of Landlord under this Lease shall not exceed the equity interest of Landlord in the Property, and no partner, member, shareholder, officer, director, employee, or agent of Landlord shall have any personal liability under this Lease.

18. ENVIRONMENTAL PROVISIONS

18.1 Compliance with Environmental Laws.
Tenant shall, at its sole cost and expense, comply with all Environmental Laws applicable to the Premises and Tenant's operations thereon, including without limitation:
(a) CERCLA (42 U.S.C. § 9601 et seq.);
(b) RCRA (42 U.S.C. § 6901 et seq.);
(c) The California Hazardous Waste Control Law (Cal. Health & Safety Code § 25100 et seq.);
(d) Proposition 65 (Cal. Health & Safety Code § 25249.5 et seq.);
(e) California Health & Safety Code § 25359.7 (notification of hazardous substance release); and
(f) All regulations promulgated thereunder and any successor statutes.

18.2 Prohibition on Hazardous Materials.
(a) Tenant shall not cause or permit any Hazardous Materials to be brought upon, generated, used, stored, treated, released, or disposed of on, under, or about the Premises or the Property, except for: (i) ordinary and customary office and janitorial supplies in quantities typical for the Permitted Use, stored, used, and disposed of in accordance with all Environmental Laws; and (ii) Hazardous Materials specifically identified in Exhibit D and approved by Landlord, subject to the conditions set forth therein.

(b) Tenant shall maintain a current inventory of all Hazardous Materials present at the Premises and shall deliver a copy to Landlord annually upon request.

18.3 Notice and Remediation.
(a) Upon discovery of any spill, release, discharge, or threatened release of Hazardous Materials at, on, under, or from the Premises, Tenant shall immediately: (i) take all actions necessary to contain and prevent the spread of contamination; (ii) notify Landlord in writing within twenty-four (24) hours; and (iii) notify all applicable governmental agencies as required by law.

(b) Tenant shall, at Tenant's sole cost, promptly investigate and remediate any contamination arising from Tenant's use or occupancy to the satisfaction of all applicable governmental agencies, using a remediation plan approved by Landlord (such approval not to be unreasonably withheld).

18.4 Landlord's Environmental Representations.
Landlord represents that, to Landlord's actual knowledge as of the date of this Lease: (a) the Property is not in violation of any Environmental Law; and (b) no underground storage tanks are present on the Property. Landlord shall provide Tenant with copies of any existing Phase I or Phase II environmental site assessments upon request.

18.5 Environmental Indemnification.
(a) Tenant's Indemnity. Tenant shall indemnify, defend, and hold harmless the Landlord Indemnitees from and against all claims, damages, costs, liabilities, fines, penalties, and expenses (including remediation costs, diminution in value, natural resource damages, and reasonable attorneys' and consultants' fees) arising from or related to any Hazardous Materials introduced to the Property by Tenant or its agents, employees, contractors, or invitees.

(b) Landlord's Indemnity. Landlord shall indemnify, defend, and hold harmless Tenant from and against all claims, damages, costs, liabilities, and expenses arising from or related to Hazardous Materials present on the Property prior to the Commencement Date or introduced by Landlord or its agents, or migrating onto the Property from adjoining properties through no fault of Tenant.

(c) Survival. The environmental indemnification obligations under this Section 18 shall survive the expiration or earlier termination of this Lease.

18.6 CEQA Compliance.

Tenant acknowledges that Tenant's Permitted Use may be subject to the California Environmental Quality Act (Cal. Pub. Res. Code § 21000 et seq.) ("CEQA"). To the extent any discretionary governmental approval is required for Tenant's operations or Alterations that triggers CEQA review, Tenant shall be solely responsible for obtaining such approvals and complying with all CEQA requirements, at Tenant's sole cost and expense.

18.7 Proposition 65 Warning.
WARNING: This Property may contain chemicals known to the State of California to cause cancer and birth defects or other reproductive harm. Tenant shall post and maintain Proposition 65 warnings as required by Cal. Health & Safety Code § 25249.5 et seq.

19. SIGNS AND EXTERIOR MODIFICATIONS

19.1 Tenant's Signage Rights.
(a) Tenant shall have the right to install signage identifying Tenant's business at the following locations, subject to Landlord's prior written approval of the design, size, placement, materials, and method of attachment:
- ☐ Suite entry door
- ☐ Building directory
- ☐ Building exterior (monument sign)
- ☐ Building facade
- ☐ Pylon sign
- ☐ Other: [________________________________]

(b) All signage shall comply with applicable municipal sign ordinances, CC&Rs, and the Building's signage criteria (if any).

19.2 Costs.
Tenant shall bear all costs of design, fabrication, installation, permitting, maintenance, and removal of Tenant's signage.

19.3 Removal.
Upon expiration or earlier termination of this Lease, Tenant shall remove all signage and repair any damage to the Building resulting from such removal, restoring the affected areas to their prior condition.

19.4 Exterior Modifications.
Tenant shall not make any modifications to the exterior of the Premises or the Building (including painting, installing antennas or satellite dishes, or modifying windows or doors) without Landlord's prior written consent, which may be withheld in Landlord's sole discretion.

20. PARKING

20.1 Parking Allocation.
Landlord shall provide Tenant with the following parking:

20.2 Parking Ratio.
The parking allocation equates to a ratio of [________________________________] spaces per 1,000 RSF.

20.3 Parking Rules.
Tenant and its employees and invitees shall comply with all parking rules and regulations established by Landlord, including designated areas, hours of operation, and vehicle size limitations.

20.4 ADA Parking.
Landlord shall maintain all required ADA-compliant accessible parking spaces and access aisles in accordance with applicable law.

21. DEFAULT AND REMEDIES

21.1 Events of Default.
The occurrence of any one or more of the following shall constitute an "Event of Default":

(a) Monetary Default. Tenant fails to pay any installment of Base Rent or Additional Rent within five (5) days after written notice that such amount is past due;

(b) Non-Monetary Default. Tenant fails to perform any non-monetary obligation under this Lease and such failure continues for thirty (30) days after written notice thereof from Landlord; provided, however, that if the nature of the default is such that it cannot reasonably be cured within thirty (30) days, then Tenant shall not be deemed in default if Tenant commences the cure within such thirty (30)-day period and thereafter diligently prosecutes the cure to completion within a reasonable time not to exceed ninety (90) days;

(c) Bankruptcy. Tenant (i) files a voluntary petition in bankruptcy or is adjudged bankrupt or insolvent under any applicable federal or state law, (ii) admits in writing its inability to pay its debts as they become due, (iii) makes a general assignment for the benefit of creditors, (iv) has a receiver or trustee appointed for all or substantially all of its assets, or (v) is the subject of an involuntary petition in bankruptcy that is not dismissed within sixty (60) days after filing;

(d) Abandonment. Tenant vacates or abandons the Premises for thirty (30) consecutive days without paying Rent;

(e) Insurance. Tenant fails to maintain any insurance required under this Lease and does not cure such failure within ten (10) days after notice; or

(f) Hazardous Materials. Tenant causes an unauthorized release of Hazardous Materials and fails to commence remediation within forty-eight (48) hours after discovery or notice.

21.2 Landlord's Remedies.
Upon the occurrence of an Event of Default, Landlord shall have the following rights and remedies, which are cumulative and in addition to any other rights or remedies available at law or in equity:

(a) Termination. Landlord may terminate Tenant's right to possession of the Premises by written notice and may recover from Tenant:
- (i) The worth at the time of award of unpaid Rent earned and due through the date of termination;
- (ii) The worth at the time of award of the amount by which the unpaid Rent that would have been earned after termination until the time of award exceeds the amount Tenant proves could have been reasonably avoided;
- (iii) The worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount Tenant proves could be reasonably avoided, discounted at the discount rate of the Federal Reserve Bank of San Francisco plus one percent (1%);
- (iv) Any other amount necessary to compensate Landlord for all detriment proximately caused by Tenant's failure to perform obligations under this Lease, including without limitation brokerage commissions, advertising costs, tenant improvement costs, and attorneys' fees;

all as set forth in Cal. Civ. Code § 1951.2.

(b) Continuation of Lease (Cal. Civ. Code § 1951.4). Even after Tenant's breach, Landlord may continue this Lease in effect and enforce all of Landlord's rights and remedies, including the right to recover Rent as it becomes due, for so long as Landlord does not terminate Tenant's right to possession.

(c) Unlawful Detainer. Landlord may recover possession of the Premises pursuant to the unlawful detainer provisions of Cal. Code Civ. Proc. §§ 1161–1179a, including by service of a three (3)-day notice to pay rent or quit (for monetary defaults) or a three (3)-day notice to perform covenant or quit (for non-monetary defaults).

(d) Self-Help. Landlord may, but shall not be obligated to, perform any obligation that Tenant has failed to perform, and charge Tenant all reasonable costs and expenses incurred, plus a ten percent (10%) administrative fee. Such amounts shall be due as Additional Rent within ten (10) days after Landlord's demand.

(e) UCC Remedies. Landlord may exercise all remedies available under the Uniform Commercial Code with respect to the security interest granted in Section 21.5.

21.3 Mitigation.
Landlord shall use commercially reasonable efforts to mitigate damages following an Event of Default, as required by Cal. Civ. Code § 1951.2.

21.4 Tenant's Remedies.
If Landlord fails to perform any obligation under this Lease and such failure continues for thirty (30) days after written notice from Tenant (or such longer period as reasonably necessary to cure, provided Landlord commences the cure within such thirty (30)-day period and diligently prosecutes the same), Tenant may: (a) pursue all remedies available at law or in equity; and (b) cure such default and offset the reasonable cost against future installments of Rent, provided that Tenant shall not offset more than [____]% of any single monthly installment of Rent.

21.5 Landlord's Lien.
In addition to any statutory landlord's lien, Tenant hereby grants Landlord a security interest in all of Tenant's personal property, trade fixtures, inventory, and equipment located in or upon the Premises, as security for the faithful performance of Tenant's obligations under this Lease. Tenant shall execute a UCC-1 financing statement and any other documentation reasonably requested by Landlord to perfect such security interest. This lien shall be subordinate to the lien of any purchase-money security interest or equipment financing.

22. CONDEMNATION

22.1 Total Taking.
If the entire Premises are taken by any public authority under the power of eminent domain or by private purchase in lieu thereof ("Condemnation"), this Lease shall terminate as of the date of such taking, and Rent shall be prorated to such date.

22.2 Partial Taking.
If a portion of the Premises is taken by Condemnation such that the remaining Premises are not reasonably suitable for Tenant's continued use for the Permitted Use, either party may terminate this Lease by written notice delivered within thirty (30) days after the taking. If this Lease is not so terminated, Landlord shall restore the remaining Premises to a tenantable condition and Base Rent shall be proportionately reduced based on the percentage of RSF taken.

22.3 Awards.
All Condemnation awards and proceeds shall belong to and be paid to Landlord, except that Tenant shall have the right to pursue a separate claim (to the extent it does not reduce Landlord's award) for: (a) the value of Tenant's trade fixtures and personal property; (b) relocation expenses; (c) loss of goodwill; and (d) the unamortized cost of Tenant Improvements paid for by Tenant.

23. CASUALTY AND RESTORATION

23.1 Notice.
If the Premises or the Building are damaged by fire or other casualty, Landlord shall promptly notify Tenant in writing of Landlord's estimate of the time required to restore the Premises.

23.2 Obligation to Restore.
Unless this Lease is terminated pursuant to Section 23.3, Landlord shall, at Landlord's expense (funded by insurance proceeds), repair and restore the Premises to substantially the same condition as existed immediately prior to the casualty, excluding Tenant Improvements, Alterations, and Tenant's personal property (which shall be Tenant's responsibility).

23.3 Termination Rights.
(a) Landlord's Termination Right. Landlord may terminate this Lease by written notice to Tenant within sixty (60) days after the casualty if: (i) the estimated cost of restoration exceeds the insurance proceeds available to Landlord; (ii) the estimated restoration period exceeds one hundred eighty (180) days; (iii) the casualty occurs during the last twelve (12) months of the Term; or (iv) more than thirty percent (30%) of the RSF of the Building is damaged.

(b) Tenant's Termination Right. Tenant may terminate this Lease by written notice to Landlord within thirty (30) days after receiving Landlord's restoration estimate if: (i) the estimated restoration period exceeds one hundred eighty (180) days; or (ii) the casualty occurs during the last twelve (12) months of the Term.

23.4 Rent Abatement.
During any period in which the Premises are rendered untenantable by reason of casualty, Base Rent and Additional Rent shall abate in proportion to the percentage of the Premises rendered untenantable, from the date of the casualty until the earlier of (a) the date restoration is substantially completed, or (b) the date Tenant recommences use of the affected area.

24. PERSONAL GUARANTY

24.1 Applicability.
☐ Not applicable — no personal guaranty required.
☐ As a material inducement to Landlord to enter into this Lease, the individual(s) identified below (each a "Guarantor") shall execute and deliver to Landlord a Personal Guaranty of Lease in the form attached as Exhibit H.

24.2 Guarantor(s).

24.3 Scope of Guaranty.
The Guaranty shall be (check one):

☐ Unlimited. Guarantor unconditionally and irrevocably guarantees all obligations of Tenant under this Lease.

☐ Limited. Guarantor's liability under the Guaranty shall not exceed $[________________________________] in the aggregate, and the Guaranty shall expire on the [____] anniversary of the Commencement Date, provided no Event of Default then exists.

☐ Declining ("Burnoff"). Guarantor's liability under the Guaranty shall reduce as follows:
- Lease Years 1–[____]: Full guarantee
- Lease Year [____]: Guarantee limited to [____] months of Base Rent
- Lease Year [____] and thereafter: Guaranty released

24.4 Estoppel by Guarantor.
Each Guarantor shall execute estoppel certificates and provide financial statements upon the same terms and within the same timeframes as required of Tenant under Section 25.

25. ESTOPPEL CERTIFICATES

25.1 Obligation.
Each party shall, within fifteen (15) business days after written request by the other party, execute and deliver an estoppel certificate addressed to such persons as the requesting party may reasonably designate (including prospective purchasers, mortgagees, and assignees), certifying:

(a) This Lease is in full force and effect and has not been modified (or stating all modifications);
(b) The dates of the Commencement Date, Rent Commencement Date, and Expiration Date;
(c) The current monthly Base Rent and Additional Rent;
(d) The amount of the Security Deposit held by Landlord;
(e) Whether, to the certifying party's knowledge, any Event of Default exists and, if so, specifying the nature thereof;
(f) The date through which Rent has been paid;
(g) Whether Tenant has any defense, offset, or counterclaim against Landlord;
(h) Whether Tenant has exercised any options under this Lease; and
(i) Such other matters as may be reasonably requested.

25.2 Effect of Failure.
If a party fails to deliver an estoppel certificate within the timeframe specified above (and within five (5) additional days after a second written request), the requesting party may conclusively rely upon the statements set forth in the request as being true, and the non-responding party shall be estopped from asserting otherwise.

26. SUBORDINATION, NON-DISTURBANCE, AND ATTORNMENT (SNDA)

26.1 Subordination.
This Lease is and shall be subject and subordinate to all ground leases, mortgages, deeds of trust, and other security instruments now or hereafter encumbering the Property (each, a "Mortgage"), and to all renewals, modifications, consolidations, replacements, and extensions thereof; provided, however, that such subordination is conditioned upon Tenant's receipt of a commercially reasonable non-disturbance agreement from the holder of each such Mortgage ("Mortgagee").

26.2 Non-Disturbance.
Landlord shall use commercially reasonable efforts to obtain from each current Mortgagee a Subordination, Non-Disturbance, and Attornment Agreement ("SNDA") in a form reasonably acceptable to Tenant and the Mortgagee, providing that so long as Tenant is not in default beyond any applicable cure period, Tenant's right to possession and all of Tenant's rights under this Lease shall not be disturbed by any foreclosure, deed in lieu, or other exercise of remedies by the Mortgagee.

26.3 Attornment.
In the event of a foreclosure, deed in lieu of foreclosure, or other transfer of Landlord's interest in the Property, Tenant shall attorn to and recognize the transferee (including any Mortgagee or purchaser at a foreclosure sale) as Landlord under this Lease for the balance of the Term, and this Lease shall continue in full force and effect. The transferee shall not be: (a) bound by any prepayment of Rent for more than one (1) month in advance; (b) liable for any prior act or omission of the former Landlord; (c) bound by any amendment to this Lease made without the Mortgagee's consent (to the extent such consent was required); or (d) subject to any offset or defense that Tenant may have against the former Landlord.

26.4 Execution of Documents.
Tenant shall, within fifteen (15) business days after request, execute any commercially reasonable SNDA or subordination agreement as may be required by Landlord or any Mortgagee, provided such agreement includes non-disturbance protections substantially as set forth in Section 26.2.

27. OPTIONS (RENEWAL, EXPANSION, RIGHT OF FIRST REFUSAL)

27.1 Renewal Option.
☐ Not applicable.
☐ Provided that (a) Tenant is not in default at the time of exercise or at the commencement of the Renewal Term, and (b) Tenant has not assigned this Lease or subleased more than fifty percent (50%) of the Premises, Tenant shall have the option to renew this Lease for [____] additional term(s) of [____] years each (each, a "Renewal Term"), upon the same terms and conditions as this Lease, except:

(a) Exercise. Tenant shall exercise the renewal option by delivering irrevocable written notice to Landlord not less than [____] months and not more than [____] months prior to the expiration of the then-current Term.

(b) Renewal Rent. Base Rent during the Renewal Term shall be the greater of: (i) [____]% of the Base Rent in effect during the last month of the expiring Term; or (ii) the then-prevailing Fair Market Rent for comparable space in the market area.

(c) Fair Market Rent Determination. If the parties cannot agree on Fair Market Rent within thirty (30) days after Tenant's exercise notice, the determination shall be made by a panel of three (3) independent MAI-certified commercial real estate appraisers, one selected by each party and the third selected by the first two. The Fair Market Rent shall be the average of the two closest appraisals. The cost of the appraisers shall be shared equally.

27.2 Expansion Option.
☐ Not applicable.
☐ Provided Tenant is not in default, Tenant shall have a one-time right to expand into the adjacent space known as [________________________________] (approximately [________________________________] RSF) (the "Expansion Space"), upon the following terms:

(a) Tenant shall exercise this option by written notice delivered to Landlord between [__/__/____] and [__/__/____].
(b) The lease of the Expansion Space shall be on the same terms as this Lease, at the then-prevailing Fair Market Rent.
(c) Landlord shall deliver the Expansion Space within [____] days after exercise.

27.3 Right of First Refusal.
☐ Not applicable.
☐ Provided Tenant is not in default, if Landlord receives a bona fide third-party offer to lease any space in the Building that becomes available during the Term (the "Available Space"), Landlord shall first offer such space to Tenant on the same terms as the third-party offer. Tenant shall have [____] business days after receipt of Landlord's notice to accept or reject the offer. If Tenant rejects or fails to respond, Landlord may lease the Available Space to the third party on terms no more favorable than those offered to Tenant.

27.4 Right of First Offer.
☐ Not applicable.
☐ Provided Tenant is not in default, before marketing any space in the Building for lease, Landlord shall first offer such space to Tenant at a rent and on terms to be determined by Landlord. Tenant shall have [____] business days to accept. If Tenant does not accept, Landlord may market and lease the space to third parties at terms no more favorable than those offered to Tenant.

28. DISPUTE RESOLUTION

28.1 Governing Law.
This Lease and any dispute arising hereunder shall be governed by and construed in accordance with the laws of the State of California, without regard to conflict-of-laws principles.

28.2 Forum Selection.
Except as provided in Section 28.3, the parties irrevocably submit to the exclusive jurisdiction of the state and federal courts located in [________________________________] County, California for the adjudication of any claim or dispute arising under or relating to this Lease.

28.3 Arbitration (Optional).
☐ Not applicable — all disputes shall be resolved in court.
☐ At either party's election, any dispute, claim, or controversy arising out of or relating to this Lease (other than (a) an unlawful detainer or other action seeking possession of real property, or (b) an action for injunctive or other provisional relief) shall be resolved by binding arbitration as follows:

(a) Administrator: JAMS, in accordance with its Comprehensive Arbitration Rules and Procedures then in effect.
(b) Location: [________________________________], California.
(c) Arbitrator: A single arbitrator who is a retired California Superior Court judge or appellate justice with at least ten (10) years of experience in commercial real estate matters.
(d) Discovery: The arbitrator shall permit limited discovery consistent with the expedited nature of arbitration, including document production and up to two (2) depositions per side.
(e) Award: The arbitrator shall render a written, reasoned award within thirty (30) days after the close of the hearing. Judgment on the award may be entered in any court of competent jurisdiction.
(f) Costs: The prevailing party shall be entitled to recover its reasonable attorneys' fees and costs from the non-prevailing party.

28.4 Attorneys' Fees.
In any action, proceeding, or arbitration arising out of this Lease, the prevailing party shall be entitled to recover from the non-prevailing party its reasonable attorneys' fees and costs, including fees incurred on appeal.

28.5 Jury Trial Waiver (Optional).
☐ Not applicable.
☐ EACH PARTY HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS LEASE OR ANY MATTER HEREUNDER. THIS WAIVER IS INFORMED AND VOLUNTARY.

28.6 Provisional Remedies.
Nothing in this Section 28 shall limit either party's right to seek provisional, injunctive, or other equitable relief, including without limitation a writ of possession or unlawful detainer, in any court of competent jurisdiction.

29. GENERAL PROVISIONS

29.1 Notices.
All notices, requests, demands, consents, and other communications required or permitted under this Lease shall be in writing and shall be deemed duly given: (a) when delivered by hand (with signed receipt); (b) one (1) business day after deposit with a nationally recognized overnight courier service (e.g., FedEx, UPS); (c) three (3) business days after deposit in the United States mail, certified or registered, return receipt requested, postage prepaid; or (d) when delivered by electronic mail with confirmed receipt (provided that a copy is also sent by one of the foregoing methods), addressed as follows:

Landlord:
[________________________________]
[________________________________]
[________________________________]
Email: [________________________________]

Tenant:
[________________________________]
[________________________________]
[________________________________]
Email: [________________________________]

Either party may change its notice address by written notice to the other party.

29.2 Broker Disclosure.
(a) Landlord is represented by [________________________________] ("Landlord's Broker").
(b) Tenant is represented by [________________________________] ("Tenant's Broker").
(c) Each party represents and warrants to the other that it has had no dealings with any real estate broker, finder, or agent in connection with this Lease other than the brokers identified above.
(d) Landlord shall pay all brokerage commissions pursuant to a separate agreement with the brokers.
(e) Each party shall indemnify the other against any claims for brokerage commissions or finder's fees arising from the indemnifying party's dealings with any other broker, finder, or agent.

29.3 Amendment; Waiver.
No amendment, modification, or supplement to this Lease shall be effective unless in writing and signed by both parties. No waiver by either party of any breach or default shall constitute a waiver of any other or subsequent breach or default. Landlord's acceptance of Rent shall not be deemed a waiver of any preceding breach or default.

29.4 Severability.
If any provision of this Lease is held to be invalid, illegal, or unenforceable by a court of competent jurisdiction, the remaining provisions shall remain in full force and effect, and the invalid provision shall be reformed to the minimum extent necessary to make it enforceable while preserving its original intent.

29.5 Entire Agreement.
This Lease, together with all exhibits, addenda, and riders attached hereto, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, proposals, negotiations, representations, and understandings, whether oral or written.

29.6 Successors and Assigns.
Subject to Section 15, this Lease shall be binding upon and inure to the benefit of the parties and their respective heirs, executors, administrators, legal representatives, successors, and permitted assigns.

29.7 Force Majeure.
Neither party shall be liable for failure or delay in performing any obligation under this Lease (other than the payment of Rent or other monetary obligations) when such failure or delay is caused by circumstances beyond the party's reasonable control, including without limitation: acts of God, earthquake, fire, flood, epidemic, pandemic, war, terrorism, civil unrest, governmental orders, strikes, labor disputes, material shortages, or utility failures ("Force Majeure"). The time for performance shall be extended for the period of such Force Majeure, provided the affected party gives prompt notice to the other party.

29.8 Quiet Enjoyment.
Landlord covenants that so long as Tenant is not in default under this Lease beyond any applicable notice and cure period, Tenant shall peaceably and quietly have, hold, and enjoy the Premises for the Term without interference from Landlord or any person claiming by, through, or under Landlord.

29.9 Holding Deposit; Interest.
The Security Deposit shall not bear interest unless required by applicable local ordinance. Landlord may commingle the Security Deposit with Landlord's general funds.

29.10 Recordation.
Neither party shall record this Lease or any memorandum thereof without the prior written consent of the other party; provided, however, that Landlord and Tenant may record a short-form memorandum of lease in the form mutually agreed upon.

29.11 Time of the Essence.
Time is of the essence with respect to each and every provision of this Lease.

29.12 Interpretation.
(a) The headings and captions in this Lease are for convenience of reference only and shall not affect the interpretation hereof.
(b) This Lease shall not be construed more strictly against either party by reason of the fact that such party or its counsel drafted this Lease.
(c) References to "days" shall mean calendar days unless "business days" is specified.

29.13 Counterparts; Electronic Signatures.
This Lease may be executed in any number of counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Signatures delivered by facsimile, PDF, or electronic signature technology (e.g., DocuSign, Adobe Sign) shall have the same force and effect as original ink signatures.

29.14 Authority.
Each party represents and warrants that (a) it has full power and authority to execute and deliver this Lease and to perform its obligations hereunder, (b) the person(s) executing this Lease on its behalf are duly authorized to do so, and (c) this Lease constitutes a valid and binding obligation enforceable in accordance with its terms.

29.15 Landlord's Access.
Landlord and its agents shall have the right, upon reasonable prior notice (not less than twenty-four (24) hours, except in case of emergency), to enter the Premises for the purposes of: (a) inspection; (b) performing maintenance or repairs; (c) showing the Premises to prospective tenants (during the last twelve (12) months of the Term), purchasers, or lenders; (d) complying with Laws; or (e) any other purpose reasonably related to Property management. Landlord shall use reasonable efforts to minimize interference with Tenant's business during any such entry.

29.16 Energy Disclosure.
Pursuant to Cal. Pub. Res. Code § 25402.10, Landlord shall provide Tenant with information regarding the energy performance of the Building, including any benchmarking data, as required by applicable law.

30. SB 1103 COMPLIANCE (QUALIFIED COMMERCIAL TENANTS)

30.1 Applicability.
☐ Tenant is not a Qualified Commercial Tenant — this Section 30 does not apply.
☐ Tenant has provided written notice and attestation of its status as a Qualified Commercial Tenant. The protections of SB 1103 (Cal. Civ. Code §§ 1946.8, 1950.9) apply to this Lease.

30.2 Rent Increase Notice Requirements.
If Tenant is a Qualified Commercial Tenant:
(a) For rent increases of ten percent (10%) or less of the rental rate then in effect: Landlord shall provide not less than thirty (30) days' prior written notice.
(b) For rent increases of more than ten percent (10%) of the rental rate then in effect: Landlord shall provide not less than ninety (90) days' prior written notice.

30.3 Building Operating Cost Limitations.
Pursuant to Cal. Civ. Code § 1950.9, Landlord shall not charge a Qualified Commercial Tenant a fee to recover Building Operating Costs unless:
(a) The costs are allocated to the Tenant proportionately based on the Tenant's share of the total leasable space;
(b) The costs were incurred within the prior eighteen (18) months or are reasonably expected to be incurred within the next twelve (12) months; and
(c) Landlord has provided the prospective Tenant with notice that the Tenant may request to inspect the documentation supporting the Building Operating Costs.

30.4 Lease Termination Notice.
For Qualified Commercial Tenants on month-to-month tenancies, Landlord shall provide not less than ninety (90) days' prior written notice of termination.

30.5 Translation Requirements.
If Tenant is a Qualified Commercial Tenant and the Lease was primarily negotiated in a language other than English, Landlord shall provide a translation of the Lease in the language in which it was negotiated, as required by SB 1103.

31. EXECUTION

IN WITNESS WHEREOF, the parties hereto have executed this Commercial Lease Agreement as of the Effective Date first written above.

LANDLORD:

[________________________________]
a [________________________________]

By: [________________________________]
Name: [________________________________]
Title: [________________________________]
Date: [__/__/____]

TENANT:

[________________________________]
a [________________________________]

By: [________________________________]
Name: [________________________________]
Title: [________________________________]
Date: [__/__/____]

NOTARY ACKNOWLEDGMENTS

State of California
County of [________________________________]

On [__/__/____], before me, [________________________________], a Notary Public, personally appeared [________________________________], who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature: [________________________________]
(Seal)

32. EXHIBITS

The following exhibits are attached hereto and incorporated herein by this reference:

SOURCES AND REFERENCES

• Cal. Civ. Code § 1938 — CASp Inspection Disclosure
• Cal. Civ. Code § 1950.7 — Security Deposits (Commercial)
• Cal. Civ. Code § 1951.2 — Landlord Damages Upon Lease Termination
• Cal. Civ. Code § 1951.4 — Landlord Right to Continue Lease After Abandonment
• Cal. Code Civ. Proc. §§ 1161–1179a — Unlawful Detainer
• SB 1103 — Commercial Tenant Protection Act (Effective Jan. 1, 2025)
• Cal. Civ. Code § 55.52 — Certified Access Specialist
• Cal. Health & Safety Code § 25359.7 — Hazardous Substance Release Notification
• Cal. Health & Safety Code § 25249.5 — Proposition 65
• Cal. Pub. Res. Code § 25402.10 — Energy Use Disclosure
• 42 U.S.C. § 12101 et seq. — Americans with Disabilities Act
• 42 U.S.C. § 9601 et seq. — CERCLA
• 42 U.S.C. § 6901 et seq. — RCRA
• BOMA International Standards (ANSI/BOMA Z65.1)
• CASp Provisions in California Commercial Real Estate Leases
• SB 1103: Key 2025 Commercial Lease Changes for Small Businesses
• SB 1103: What California Landlords and Tenants Need to Know

Prepared for attorney review. This template is provided for informational purposes only and does not constitute legal advice.