Commercial Lease Letter of Intent (Multi-Tenant) - California

LETTER OF INTENT -- MULTI-TENANT COMMERCIAL LEASE (CALIFORNIA)

CONFIDENTIAL -- FOR SETTLEMENT AND NEGOTIATION PURPOSES ONLY

Date: [__/__/____]

Delivered via: ☐ Email ☐ Hand Delivery ☐ Certified Mail ☐ Overnight Courier

RECITALS AND PURPOSE

This Letter of Intent ("LOI") sets forth the principal terms upon which [________________________________] ("Landlord") and [________________________________] ("Tenant") propose to enter into a definitive commercial lease agreement (the "Lease") for space within a multi-tenant property located in the State of California. Except for the Binding Provisions identified in Section 20 below, this LOI is intended to be non-binding and shall not constitute or create any legally binding obligation on either party to consummate the transaction described herein.

California Practice Note: Under Copeland v. Baskin Robbins U.S.A., 96 Cal.App.4th 1251 (2002), an agreement to negotiate may be enforceable in California and may impose a duty of good faith and fair dealing. The parties should clearly delineate which provisions are binding and which are non-binding. Reliance damages (out-of-pocket costs, missed opportunities) may be recoverable for breach of an agreement to negotiate in good faith.

1. PARTIES

Landlord:
- Legal Name: [________________________________]
- Entity Type: [________________________________]
- State of Organization: [________________________________]
- Principal Address: [________________________________]
- Contact Person: [________________________________]
- Email: [________________________________]
- Phone: [________________________________]

Tenant:
- Legal Name: [________________________________]
- Entity Type: [________________________________]
- State of Organization: [________________________________]
- Principal Address: [________________________________]
- Contact Person: [________________________________]
- Email: [________________________________]
- Phone: [________________________________]

2. PREMISES AND BUILDING DESCRIPTION

Building:
- Building Name: [________________________________]
- Building Address: [________________________________]
- County: [________________________________], California
- Building Type: ☐ Office ☐ Retail ☐ Mixed-Use ☐ Industrial ☐ Medical ☐ Other: [____]
- Total Building Rentable Area: [________________________________] RSF
- Number of Tenants in Building: [____]
- Year Built / Last Renovated: [____] / [____]

Premises:
- Suite / Unit Number(s): [________________________________]
- Approximate Rentable Square Footage: [________________________________] RSF
- Approximate Usable Square Footage: [________________________________] USF
- Floor(s): [________________________________]
- Load Factor / R/U Ratio: [____]%
- Current Condition: ☐ Shell / Cold Dark Shell ☐ Second-Generation Space ☐ Built-Out ☐ Other: [____]

Measurement Standard:
- ☐ BOMA 2017 (Office) ☐ BOMA 2010 (Retail) ☐ Other: [________________________________]
- Landlord to provide BOMA measurement certificate or right for Tenant to verify prior to Lease execution.

3. LEASE TERM AND COMMENCEMENT

• Initial Term: [____] years [____] months
• Anticipated Commencement Date: [__/__/____]
• Rent Commencement Date: The earlier of: (a) [____] days after the Commencement Date; or (b) the date Tenant opens for business in the Premises.
• Expiration Date: [__/__/____] (subject to adjustment based on actual Commencement Date)
• Early Access / Fixturing Period: [____] days prior to the Commencement Date for fixturing and move-in at no charge for Base Rent (Tenant responsible for utilities and insurance during fixturing).

4. DELIVERY AND LATE DELIVERY REMEDIES

• Delivery Condition: ☐ Warm Shell ☐ Cold Dark Shell ☐ As-Is ☐ Landlord Work Complete ☐ Other: [____]
• Target Delivery Date: [__/__/____]
• Outside Delivery Date: [__/__/____]
• Late Delivery Abatement: If Landlord fails to deliver the Premises by the Outside Delivery Date, Tenant shall receive one (1) day of free Base Rent for each day of delay beyond the Outside Delivery Date.
• Extended Delay Termination Right: If Landlord fails to deliver the Premises within [____] days after the Outside Delivery Date, Tenant may terminate this LOI and (upon Lease execution) the Lease by written notice, and Landlord shall return all deposits and reimburse Tenant's reasonable out-of-pocket costs incurred in reliance, up to $[________________________________].

5. BASE RENT AND ESCALATIONS

• Annual Escalation: ☐ Fixed at [____]% per annum ☐ CPI-based (capped at [____]%) ☐ Fair Market Value adjustment at Year [____] ☐ Other: [________________________________]
• Free Rent / Abatement Period: [____] months of Base Rent abatement following the Commencement Date (Tenant responsible for Additional Rent during abatement period unless otherwise agreed).

6. ADDITIONAL RENT -- CAM, TAXES, AND INSURANCE

Lease Structure:
☐ Modified Gross ☐ Full Service Gross ☐ Triple Net (NNN) ☐ Other: [________________________________]

Base Year / Base Stop:
- Base Year for Operating Expenses: Calendar year [____]
- Base Year for Real Property Taxes: Tax year [____]-[____]
- Tenant's Proportionate Share: [____]% (based on [____] RSF of Premises / [____] RSF total building)

Estimated Year 1 Additional Rent:
- Operating Expenses (CAM): $[____]/RSF/year
- Real Property Taxes: $[____]/RSF/year
- Insurance: $[____]/RSF/year
- Total Estimated Additional Rent: $[____]/RSF/year

CAM Provisions (Multi-Tenant Specific):

(a) Controllable Expense Cap: Annual increases in Controllable Operating Expenses (defined to exclude real property taxes, insurance, utilities, snow removal/emergency repairs, and government-mandated costs) shall not exceed [____]% per annum on a cumulative/non-cumulative basis.

(b) Gross-Up: If the Building is less than [____]% occupied during any calendar year, Operating Expenses shall be adjusted ("grossed-up") to reflect the level that would have been incurred had the Building been [____]% occupied. Landlord shall not recover more than actual expenses.

(c) Exclusions from CAM: The following shall be excluded from Operating Expenses passed through to Tenant:
- Capital expenditures (except those mandated by law enacted after the Commencement Date or those reducing Operating Expenses, amortized over their useful life with interest at [____]%)
- Leasing commissions, tenant improvement costs, and concession costs for other tenants
- Costs of correcting latent defects in original construction
- Landlord's income taxes, franchise taxes, or transfer taxes
- Depreciation and debt service
- Costs covered by insurance proceeds or warranties
- Management fees in excess of [____]% of gross revenues
- Fines, penalties, or interest charges
- Costs attributable to Landlord's negligence or willful misconduct

(d) Audit Rights: Tenant shall have the right to audit Landlord's Operating Expense records annually. If an audit reveals overcharges exceeding [____]%, Landlord shall reimburse Tenant's reasonable audit costs and refund the overcharge with interest at [____]%.

California Property Tax Note (Proposition 13): Under Cal. Rev. & Tax. Code § 60 et seq., real property is reassessed upon a "change in ownership." A sale of the Building during the Lease Term could result in a significant increase in the property tax assessment. The parties should address in the Lease: (i) whether Tenant's tax pass-through is based on the tax bill in effect as of the Base Year or as of the Commencement Date; (ii) whether reassessment resulting from a voluntary sale by Landlord is a pass-through event or absorbed by Landlord; and (iii) any cap on tax pass-throughs attributable to reassessment.

California Practice Note: Confirm whether the property is subject to any Mello-Roos Community Facilities District special taxes (Gov. Code § 53311 et seq.) or special assessment districts, which may significantly increase tax obligations.

7. TENANT IMPROVEMENT ALLOWANCE AND LANDLORD WORK

Tenant Improvement Allowance ("TIA"):
- Amount: $[____] per RSF (total: approximately $[________________________________])
- Disbursement: ☐ Lump sum upon completion ☐ Progress payments ☐ Rent credit ☐ Other: [____]
- Unused TIA: ☐ Forfeited ☐ Applied as rent credit up to [____]% ☐ Cash payment to Tenant up to [____]%
- TIA Expiration: Must be utilized within [____] months of the Commencement Date

Landlord Work:
- Scope: [________________________________]
- Plans and Specifications: To be mutually agreed within [____] days of LOI execution
- Completion Deadline: [__/__/____]

Code Compliance Allocation:

California Accessibility Disclosure (Cal. Civ. Code § 1938): The Lease must disclose whether the Premises have been inspected by a Certified Access Specialist ("CASp") and, if so, whether the Premises meet applicable construction-related accessibility standards. If a CASp inspection has been completed, a copy of the report must be provided to Tenant. If not inspected, Landlord must state that fact. Tenant has the right to request a CASp inspection. Unless otherwise specified in the Lease, the landlord is presumed responsible for ADA compliance in the Premises.

Seismic Considerations: For buildings constructed before 1978, parties should address potential unreinforced masonry ("URM") or non-ductile concrete retrofit requirements under local ordinances (e.g., City of Los Angeles Ordinances 183893 and 184081, City of San Francisco Building Code Chapter 34B). Seismic strengthening triggers ADA accessibility requirements per CBC Chapter 11B.

CALGreen (California Green Building Standards Code): Tenant improvements exceeding certain thresholds trigger mandatory CALGreen compliance, including requirements for water conservation, energy efficiency, material resource management, and indoor environmental quality. All new commercial projects over 10,000 square feet require commissioning.

8. PERMITTED USE, EXCLUSIVE USE, AND CO-TENANCY

Permitted Use:
- Primary Use: [________________________________]
- Ancillary Uses: [________________________________]
- Prohibited Uses: [________________________________]
- Use must comply with applicable zoning (current zoning: [____]), CC&Rs, and all applicable laws

Exclusive Use Provision (Multi-Tenant Specific):
- Tenant shall have the exclusive right within the Building/Project to operate as a [________________________________].
- Exclusivity shall not apply to: (i) tenants in occupancy as of the date of the Lease whose existing use conflicts; (ii) uses that are ancillary to another tenant's primary permitted use and constitute less than [____]% of such tenant's gross revenue; (iii) [________________________________].
- Remedies for Violation: ☐ Reduced rent to [____]% of Base Rent ☐ Right to terminate ☐ Injunctive relief ☐ Combination: [________________________________]

Co-Tenancy Provision (Multi-Tenant / Retail Specific):

(a) Opening Co-Tenancy: Tenant's obligation to open for business is conditioned upon:
- [________________________________] ("Anchor Tenant") being open and operating in at least [____] RSF
- At least [____]% of the Building/Project RSF being leased and occupied
- Failure Remedy: If opening co-tenancy conditions are not satisfied by [__/__/____], Tenant may: ☐ delay opening without penalty ☐ pay reduced rent of $[____]/month ☐ terminate the Lease

(b) Ongoing Co-Tenancy: During the Lease Term, if:
- Anchor Tenant ceases operations for more than [____] consecutive days (excluding remodel/casualty)
- Overall Building/Project occupancy falls below [____]%
- Failure Remedy: Tenant may: ☐ pay reduced rent of [____]% of Base Rent ☐ terminate the Lease after [____] days' notice ☐ both

Tenant Mix / Use Restrictions:
- Landlord represents that the following uses are prohibited in the Building/Project: [________________________________]
- Landlord shall not lease to the following categories of tenants without Tenant's prior consent: [________________________________]

Radius Restriction (Retail Only):
- ☐ Not applicable ☐ Tenant shall not operate a competing business within [____] miles of the Premises for the Term and [____] months thereafter
- Exceptions: [________________________________]

Go-Dark Provision:
- ☐ Tenant must remain open and operating during the Lease Term during customary business hours
- ☐ Tenant may cease operations ("go dark") upon [____] days' prior notice, provided Tenant continues to pay all Rent and maintain the Premises
- ☐ Landlord recapture right if Tenant ceases operations for more than [____] consecutive days

9. RENEWAL OPTIONS

• Number of Options: [____] renewal option(s) of [____] years each
• Notice Period: Tenant must exercise each option by written notice no later than [____] months prior to expiration of the then-current Term
• Renewal Rent: ☐ Fair Market Value ("FMV") ☐ Fixed rate of $[____]/RSF ☐ [____]% increase over expiring rent ☐ Greater of FMV or [____]% increase

FMV Determination (if applicable):
1. Landlord and Tenant shall attempt to agree on FMV within [____] days of Tenant's exercise notice.
2. If unable to agree, each party shall appoint a licensed MAI appraiser within [____] days.
3. If the two appraisals are within [____]% of each other, the FMV shall be the average.
4. If not, the two appraisers shall select a third appraiser. The FMV shall be determined by "baseball arbitration" -- the third appraiser shall select whichever of the first two appraisals is closest to the third appraiser's independent determination.
5. FMV shall exclude the value of Tenant's improvements, goodwill, and going-concern value, and shall consider comparable multi-tenant properties of similar age, quality, and location.

10. EXPANSION RIGHTS AND RIGHT OF FIRST OFFER / REFUSAL

Right of First Offer ("ROFO"):
- ☐ Tenant shall have a ROFO on Suite(s) [________________________________] (the "ROFO Space")
- Landlord must offer ROFO Space to Tenant before marketing to third parties
- Tenant shall have [____] business days to accept on the terms offered
- ROFO subject to existing expansion rights of: [________________________________]

Right of First Refusal ("ROFR"):
- ☐ Tenant shall have a ROFR on [________________________________] (the "ROFR Space")
- Tenant shall have [____] business days to match any bona fide third-party offer

Expansion Option:
- ☐ Tenant shall have the option to expand into [________________________________] at a rent of $[____]/RSF (or then-current FMV) upon [____] months' notice

11. SIGNAGE

• ☐ Suite entry signage per Building standard
• ☐ Building directory listing
• ☐ Building-top or monument signage (subject to availability and municipal approval)
• ☐ Specifications: [________________________________]
• All signage subject to Landlord's reasonable approval and compliance with local sign ordinances and CC&Rs.
• Landlord to identify any existing exclusive signage rights held by other tenants: [________________________________]

12. PARKING

• Allocated Spaces: [____] spaces per 1,000 RSF = [____] total spaces
• Type: ☐ Unreserved ☐ Reserved ☐ Covered ☐ Structured ☐ Surface
• Monthly Charge: $[____] per unreserved space; $[____] per reserved space
• EV Charging: ☐ Available ☐ To be installed ☐ Not applicable
• Parking ratio and charges subject to applicable local ordinances and ADA accessibility requirements

13. ASSIGNMENT AND SUBLETTING

• Landlord's consent required for any assignment or subletting, which consent shall not be unreasonably withheld, conditioned, or delayed.
• Permitted Transfers (No Consent Required): Transfers to an entity that: (i) controls, is controlled by, or is under common control with Tenant; (ii) acquires all or substantially all of Tenant's assets; or (iii) is the surviving entity in a merger or consolidation with Tenant, provided the successor entity has a tangible net worth of not less than $[________________________________].
• Profit Sharing: Landlord entitled to [____]% of any subletting or assignment profit (net of Tenant's reasonable costs of subletting/assignment) after [____] months.
• Recapture Right: ☐ Landlord shall have the right to recapture the Premises upon Tenant's request to assign or sublet ☐ No recapture right

14. INSURANCE AND INDEMNITY

Tenant Insurance Requirements:
- Commercial General Liability: $[________________________________] per occurrence / $[________________________________] aggregate
- Property Insurance: Full replacement cost of Tenant's property and improvements
- Workers' Compensation: Statutory limits
- Business Interruption: [____] months
- Additional coverages as required: ☐ Umbrella ☐ Environmental ☐ Earthquake ☐ Flood

Mutual Provisions:
- Mutual waiver of subrogation
- Landlord named as additional insured on Tenant's CGL policy
- Mutual indemnification for negligence or willful misconduct

California Earthquake Insurance Note: California is a high seismic risk zone. Parties should consider whether earthquake insurance is required and how costs are allocated, particularly in regions along the San Andreas, Hayward, or other active fault zones. Standard property insurance policies typically exclude earthquake damage.

15. ENVIRONMENTAL AND SUSTAINABILITY

Environmental Representations:
- Landlord represents that, to Landlord's actual knowledge: (i) the Premises and Building are not contaminated with Hazardous Materials in violation of Environmental Laws; (ii) no underground storage tanks are located on or under the Property; (iii) the Property is not listed on any federal or state environmental cleanup list.

CEQA Compliance (Cal. Pub. Res. Code § 21000 et seq.):
- If Tenant's proposed use requires a discretionary governmental approval (e.g., conditional use permit, zoning variance), such approval may trigger CEQA environmental review. The parties shall cooperate in obtaining any required CEQA clearance.
- Landlord shall disclose any known CEQA conditions, mitigation measures, or monitoring programs applicable to the Property.

Sustainability:
- Building certifications (if any): ☐ LEED ☐ ENERGY STAR ☐ WELL ☐ Other: [____]
- Tenant shall comply with applicable CALGreen requirements for tenant improvements
- Utility data sharing: ☐ Landlord to provide utility benchmarking data per AB 802 (Cal. Pub. Res. Code § 25402.10)

16. CASUALTY AND CONDEMNATION

Casualty:
- If the Premises are damaged and cannot be restored within [____] days, either party may terminate the Lease.
- If the Building is damaged to the extent that [____]% or more of the RSF is unusable, either party may terminate.
- During restoration, Rent shall abate in proportion to the unusable portion of the Premises.

Condemnation:
- If all or a material portion of the Premises is taken by eminent domain, either party may terminate.
- Tenant entitled to make a separate claim for relocation expenses, loss of business, and the unamortized value of Tenant's improvements (to the extent not paid by the TIA).

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

• Landlord shall deliver a commercially reasonable SNDA from each existing and future lender holding a lien on the Building within [____] days of Lease execution.
• SNDA shall provide that, so long as Tenant is not in default under the Lease, Tenant's possession and rights shall not be disturbed upon foreclosure or deed-in-lieu.
• Landlord shall provide an estoppel certificate upon Tenant's reasonable request within [____] business days.

18. SECURITY DEPOSIT

• Amount: $[________________________________] (equivalent to [____] months' estimated total Rent)
• Form: ☐ Cash ☐ Letter of Credit ☐ Other: [________________________________]
• Reduction: Security Deposit may be reduced to $[________________________________] after Year [____] if Tenant is not in default.

California Security Deposit Note (Cal. Civ. Code § 1950.7): For commercial leases, the landlord may apply the security deposit to: (i) unpaid rent; (ii) repair of damages caused by tenant (beyond normal wear and tear); and (iii) cleaning. The statute's protections may be waived in commercial leases by express agreement of the parties. If no waiver is included, § 1950.7 limits the landlord's retention rights. Any remaining deposit must be returned within 30 days of lease termination. The parties should address in the Lease whether § 1950.7 is expressly waived.

19. BROKERS

• Landlord's Broker: [________________________________]
• Tenant's Broker: [________________________________]
• Commissions shall be paid by Landlord pursuant to a separate agreement between Landlord and Landlord's Broker.
• Each party represents that it has not engaged any broker other than the broker(s) identified above and shall indemnify, defend, and hold harmless the other party from claims by any other broker or finder claiming through such party.

20. BINDING PROVISIONS

Notwithstanding the non-binding nature of this LOI, the following provisions shall be binding and enforceable upon execution of this LOI by both parties:

(a) Exclusivity Period: From the date of this LOI through [__/__/____] (the "Exclusivity Period"), Landlord shall not market, show, negotiate, or enter into any letter of intent, lease, or other occupancy agreement with any third party for the Premises.

(b) Confidentiality: Each party shall keep the terms of this LOI and all negotiations confidential, except as required by law or as necessary for disclosure to such party's attorneys, accountants, lenders, and bona fide business advisors, each of whom shall be bound by similar confidentiality obligations.

(c) Broker Indemnification: The mutual broker indemnification set forth in Section 19 shall be binding.

(d) Governing Law and Venue: This LOI shall be governed by and construed in accordance with the laws of the State of California, without regard to conflicts of law principles. Any dispute arising out of the Binding Provisions shall be resolved exclusively in the state or federal courts located in [________________________________] County, California.

(e) Expenses: Each party shall bear its own costs and expenses incurred in connection with the negotiation of this LOI and the Lease, including attorneys' fees, unless otherwise agreed in writing.

(f) No Agreement to Negotiate: Except as expressly set forth in this Section 20, this LOI does not constitute an agreement to negotiate, an agreement to enter into a lease, or any other binding commitment. The parties expressly disclaim any obligation to negotiate in good faith beyond the Binding Provisions, except to the extent such disclaimer is found unenforceable by a court of competent jurisdiction.

California Practice Note: The disclaimer in Section 20(f) is designed to address the holding in Copeland v. Baskin Robbins U.S.A., 96 Cal.App.4th 1251 (2002), where the California Court of Appeal held that an agreement to negotiate is enforceable and imposes a duty of good faith. Despite this disclaimer, California courts may still find an implied obligation to negotiate in good faith based on the totality of circumstances. Counsel should evaluate the enforceability of this disclaimer in light of current case law.

21. LEASE NEGOTIATION TIMELINE

22. ADDITIONAL CALIFORNIA-SPECIFIC PROVISIONS

(a) Proposition 65 (Cal. Health & Safety Code § 25249.5 et seq.): Landlord shall post or cause to be posted any required Proposition 65 warnings for the Building. The parties shall cooperate to ensure compliance with Proposition 65 signage requirements.

(b) Earthquake Preparedness: The Lease shall include provisions addressing earthquake preparedness, including seismic retrofit obligations (if applicable), earthquake insurance requirements, and business continuity planning. Landlord shall disclose any known seismic hazard zone designations (Alquist-Priolo Earthquake Fault Zones Act, Seismic Hazards Mapping Act).

(c) Local Ordinances: The Lease shall comply with all applicable local ordinances, including but not limited to: local business license and tax requirements, rent control ordinances (if applicable to commercial property -- note that Cal. Civ. Code § 1954.26 generally preempts local commercial rent control enacted after 1/1/1987), local seismic retrofit mandates, and local green building requirements.

(d) AB 1482 Distinction: The parties acknowledge that the California Tenant Protection Act of 2019 (Cal. Civ. Code § 1946.2) applies only to residential tenancies and does not govern this commercial lease transaction.

(e) COVID-19 Legacy Provisions: The parties shall address in the Lease any continuing effects of prior COVID-19 commercial eviction moratoria, including any pending disputes, rent deferrals, or workout agreements affecting the Premises or Building.

23. FORCE MAJEURE

For purposes of the Binding Provisions, neither party shall be liable for delays or failures in performance resulting from acts of God, earthquake, fire, flood, pandemic, government orders, strikes, or other causes beyond the reasonable control of the affected party, provided that the affected party gives prompt written notice and uses commercially reasonable efforts to mitigate the delay.

24. COUNTERPARTS AND ELECTRONIC SIGNATURES

This LOI may be executed in counterparts, each of which shall be deemed an original. Electronic signatures and PDF/DocuSign execution shall be valid and binding for the Binding Provisions.

PRACTICE TIPS FOR CALIFORNIA MULTI-TENANT COMMERCIAL LEASE LOI

1. CASp Inspection: Always confirm whether a CASp inspection has been completed. Under Cal. Civ. Code § 1938, failure to disclose CASp status is a violation. If no inspection has been done, tenants should consider requesting one as a condition of the LOI.

2. Proposition 13 Reassessment Risk: A sale of the building triggers property tax reassessment. Tenants should negotiate a cap on tax pass-throughs attributable to voluntary sales by Landlord, or lock in a Base Year that cannot be reset by a change in ownership.

3. CAM Audit Rights: In multi-tenant properties, CAM charges are a frequent source of disputes. Negotiate robust audit rights, an expense cap on controllable expenses, and clear CAM exclusions.

4. Exclusive Use Enforcement: California courts generally enforce exclusive use provisions in commercial leases. However, remedies (reduced rent vs. termination) should be clearly defined. Consider whether the exclusive applies to the entire shopping center/project or just the building.

5. Co-Tenancy Protections: For retail tenants, co-tenancy provisions protect against anchor tenant departures. Negotiate both opening and ongoing co-tenancy conditions with clear remedies (rent reduction, right to terminate).

6. Seismic Retrofit: Especially in Los Angeles and San Francisco, local mandatory retrofit ordinances may impose significant costs. Allocate responsibility clearly between Landlord and Tenant in the LOI.

7. CEQA Review: If the tenant's use requires discretionary permits, CEQA review may be triggered. Factor review timelines (which can extend 6-18 months) into the lease negotiation schedule.

8. SNDA: Always require SNDA from Landlord's lender(s) as a condition of the Lease. This protects Tenant's leasehold in the event of foreclosure.

9. Security Deposit and Section 1950.7: Decide early whether to waive Cal. Civ. Code § 1950.7 protections. If the Lease does not contain an express waiver, the statute limits Landlord's right to retain the security deposit for future rent damages.

10. LOI Enforceability: Include clear disclaimers to avoid an inadvertent binding obligation. Despite disclaimers, California courts may still find implied duties to negotiate in good faith based on the parties' conduct.

SIGNATURES

This LOI is non-binding except for the Binding Provisions in Section 20.

LANDLORD: TENANT:

Entity: ______________________________ Entity: ______________________________

By: __________________________________ By: __________________________________

Name: ________________________________ Name: ________________________________

Title: _______________________________ Title: _______________________________

Date: [__/__/____] Date: [__/__/____]

SOURCES AND REFERENCES

• Cal. Civ. Code § 1938 -- Commercial Property Accessibility Disclosure
• Cal. Civ. Code § 1950.7 -- Commercial Security Deposits
• Copeland v. Baskin Robbins U.S.A., 96 Cal.App.4th 1251 (2002) -- LOI Enforceability
• Cal. Rev. & Tax. Code § 60 et seq. -- Proposition 13 Change in Ownership
• Cal. Pub. Res. Code § 21000 et seq. -- California Environmental Quality Act (CEQA)
• Cal. Code Regs. tit. 24, Part 11 -- CALGreen Building Standards
• BOMA International -- Building Measurement Standards