HomeMy WebLinkAboutOrdinance 2862 N.C.S. 11/06/2023 DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
EFFECTIVE DATE ORDINANCE NO. 2862 N.C.S.
OF ORDINANCE
December 6, 2023
Introduced by: Michael Healy Seconded by: Janice Cader Thompson
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF PETALUMA APPROVING A 5-
YEAR EXTENSION TO THE COMMERCIAL LEASE BETWEEN THE CITY OF PETALUMA AND
SONOMA MARIN AREA RAIL TRANSIT (SMART) FOR THE PROPERTY LOCATED AT 210
LAKEVILLE STREET (APN 007-131-004) WHICH INCLUDES THE OLD TRAIN DEPOT AND
NEIGHBORING BUILDINGS AND PARKING LOT
WHEREAS, on August 1, 2003, the Petaluma Community Development Commission(PCDC) entered
a Master Lease with Northwestern Pacific Railroad Authority(Authority) for the rehabilitation of the Train
Depot Buildings located on the Authority's land and the subsequent use of those buildings for nonprofit
activities; and
WHEREAS, the initial term of the lease was 10 years with options to extend the lease by 5 years up to 3
times for a total of 25 years; and
WHEREAS, since the initial lease was executed, the PCDC has undergone significant renovations of
the Train Depot buildings and subleased and/or licensed the buildings to the Petaluma Art Center and the
Petaluma Visitor's Center; and
WHEREAS, subsequent to the execution of the lease, the Petaluma Community Development
Commission was dissolved, and the Lease was assigned to the City of Petaluma while the Authority assigned its
part of the lease to SMART; and
WHEREAS, an option to exercise the Lease was completed in 2018 which expired on July 31, 2023,
and an additional option was requested earlier this year; and
WHEREAS, the City of Petaluma now desires to extend the lease agreement with SMART for a period
of five (5)years; and
WHEREAS, the properties are significant to the city's history and provide venues for local non-profits,
such as the Downtown Association/Visitor Program and the Art Center; and
WHEREAS, under the terms of the proposed lease extension, the City of Petaluma agrees to pay
SMART $12,000 annually; and
WHEREAS, on September 18, 2023, City Council unanimously introduced this ordinance.
Ordinance No. 2862 N.C.S. Page 1
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NOW THEREFORE BE IT ORDAINED by the City Council of the City of Petaluma, as follows:
Section 1. Findings The City Council hereby finds and determines the foregoing recitals to be true and correct
and hereby incorporates them into this ordinance as findings and determinations of the City Council.
Section 2. Exemptions from CEQA Introducing an ordinance to approve an extension to an existing lease
agreement is categorically exempt under the California Environmental Quality Act("CEQA")in accordance with
Sections 15301 (Existing Facilities) 15303 (New Construction or Conversion of Small Structures), and 15304
(Minor Alterations to Land) as the lease space is located at an already improved property and will extend the
already existing services for five years.
Section 3. Approval of Lease. In accordance with Section 46 of Article VII of the Petaluma City Charter and
other applicable law, the 5-year extension to the commercial lease between the City of Petaluma and Sonoma
Marin Area Rail Transit(SMART) for the property located at 210 Lakeville Street(APN 007-131-004) which
includes the old train depot and neighboring buildings and parking lot that is attached to and is hereby made a
part of this ordinance as Exhibit A is hereby approved, and the City Manager is hereby authorized and directed
to execute on behalf of the City the lease extension that is substantially in accordance with that attached as
Exhibit A and is approved as such by the City Attorney.
Section 4. Severability If any section, subsection, sentence, clause, phrase or word of this ordinance is for any
reason held to be unconstitutional,unlawful or otherwise invalid by a court of competent jurisdiction or preempted
by state legislation, such decision or legislation shall not affect the validity of the remaining portions of this
ordinance. The City Council of the City of Petaluma hereby declares that it would have passed and adopted this
ordinance and each and all provisions thereof irrespective of the fact that any one or more of said provisions be
declared unconstitutional, unlawful or otherwise invalid.
Section 6. Posting/Publishing of Notice The City Clerk is hereby directed to publish or post this ordinance or a
synopsis for the period and in the manner provided by the City Charter and other applicable law.
INTRODUCED and ordered published and posted this 18th day of September 2023.
ADOPTED this 6th day of November 2023 by the following vote:
Ayes: McDonnell, Barnacle, Cader Thompson, Healy,Nau, Pocekay, Shribbs
Noes: None
Abstain: None
Absent: None
DocuSigned by:
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Kevin McDonnell, Mayor
ATTEST: APPROVED AS TO FORM:
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ned by: DocuSigned by:
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Kami Noriega, Interim City Clerk Eric Danly, City Attorney
Ordinance No. 2862 N.C.S. Page 2
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Exhibit A
5-year Extension to the Commercial Lease between the City of Petaluma and Sonoma
Marin Area Rail Transit (SMART) for the Property Located at 210 Lakeville Street (APN
007-131-004)
Ordinance No. 2862 N.C.S. Page 3
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COMMERCIAL LEASE
THIS COMMERCIAL LEASE ("Lease")is entered into the first day of August, 2003,
("Effective Date"),by and between the NORTHWESTERN PACIFIC RAILROAD
AUTHORITY, a public joint powers authority("Lessor"), and the Petaluma Community
Development Commission ("Lessee") 11 English Street, Petaluma, CA 94952.
1. Premises.
Subject to the terms and conditions set forth herein Lessor hereby leases to Lessee, and
Lessee leases from Lessor, the real property and the improvements thereon located in the City of
Petaluma, County of Sonoma, State of California("Premises") consisting of approximately
71,874 SF of land at milepost 5-38.5,APN#007-131-004, together with the improvements
thereon consisting of three buildings: the Petaluma Passenger Depot—a 2,540 SF building, the
Baggage Shed—a 520 SF building and the Freight Shed--a 4,760 SF building, as depicted on
Exhibit A, that is attached to this Lease and incorporated into it by this reference.
2. Effective Date.
This Lease shall take effect on August 1, 2003 ("Effective Date"), and supersedes any
prior lease existing between the parties or their predecessors.
3. Term.
This Lease shall be for a teen of ten (10)years ("Lease Term") from the Effective Date,
unless sooner terminated as provided herein. In the event Lessee does not complete construction
of the Tenant Improvements within five(5)years from the Effective Date, unless this five-year
term is extended by the mutual consent of the parties, Lessor shall have the right to terminate this
Lease on ninety(90) days prior written notice to Lessee.
4. Use/Termination for Transit Activities.
This section is intended to provide disclosure to Lessee that all or a portion of the
Premises may be needed for transportation related purposes, and to limit Lessee's claims and
remedies against Lessor or any other governmental agency for early termination of this Lease or
the "taking" of the property for transportation purposes. Lessee acknowledges that it takes this
Lease with the express knowledge that Lessor may conduct Transit Activities on, around, under
or over the Premises and subject to the rights specifically reserved in Section 21,below. Transit
Activities shall include,but are not limited to, any activities relating to the study, design,
development, construction,maintenance, operation,mapping, testing, or surveying of
transportation systems or transit related projects,including, as an example platforms, passenger
loading areas, arcades,parking(collectively"Transit Activities"). In the event Lessor determines
that it needs to obtain possession of all or a portion of the Premises, or needs to place restrictions
on Lessee's use of the Premises, Lessor shall give Lessee THREE HUNDRED SIXTY FIVE
(365)days notice prior to the date Lessee must vacate the Premises, a portion of the Premises or
restrict the Permitted Use("Surrender Date"). If Lessor shall only require a portion of the
Premises,this Lease shall continue in full force except that Rent shall be reduced in proportion to
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the area of such part of the Premises rendered unusable by Lessee for the conduct of its business
compared to the total area of the Premises;provided,however, that if the entire Premises shall be
deemed unusable if the extent and nature of the transit activities substantially impairs Lessee's
use of the balance of the Premises, this Lease shall terminate on the Surrender Date. If Lessor
requires the entire Premises or its Transit Activities substantially impair Lessee's Permitted Use,
Lessee shall peaceably surrender possession of the Premises on or before the Surrender Date, and
this Lease shall be deemed terminated except for those terms intended to survive termination.
If during the Term of this Lease or any extension thereof,the Premises are needed for such a
transportation project, Lessee acknowledges and agrees that Lessor may terminate this Lease as
provided above. In the event of such a termination by Lessor, or a condemnation of the Premises
by Lessor or any third party, Lessee's sole remedy from Lessor or any other governmental
agency for any such termination or condemnation shall be Lessor's (or the condemning agency's)
reimbursement to Lessee of the unamortized value of the Lessee's actual out of pocket costs in
completing the Tenant Improvements as of the date of termination, amortized on a straight line
basis over a twenty-five year period from the Effective Date. Towards this end, within 60 days
of completion of the Tenant Improvements, Lessee shall provide Lessor with a statement of the
actual out of pocket costs of the Tenant Improvements made to the Premises. Such actual out of
pocket costs shall serve as the basis for the calculation of any reimbursement due to Lessee upon
such termination or condemnation. Except as expressly provided for in this Section 4, Lessee,
for itself, and any subtenants, sublessees or other pennittees knowingly waives any other
benefits,monetary or otherwise, under the California Relocation Assistance Law (Cal.
Government Code Section 7260 et sec.) and the Federal Uniform Relocation Assistance and Real
Property Acquisition Policies Act of 1970 (Title 42,United States Code, Section 4601 et seq.) as
such laws may be amended. Lessee also agrees to indemnify and defend Lessor for any claims
fil ursuant to either statute set forth above by any tenants or sublessees of Lessee.
essee
5. Use.
It is the intention of Lessor and Lessee/City in entering into this lease to halt the
deterioration and blight of the Petaluma Station site buildings,to provide for the rehabilitation
and restoration of the historic Petaluma Station buildings and to provide for clearing of the
Station site parcel of debris and weeds and to landscape and be responsible for ongoing
maintenance of the buildings and grounds. The City agrees to assume all rehabilitation,
restoration and maintenance of the buildings and grounds of the Station buildings parcel and
assume all liability for the buildings and associated grounds for the duration of the lease. Lessor
agrees to lease the buildings and grounds to the City under the terms and conditions outlined in
the lease and to cooperate, as needed, to further the City's applications for state or federal
funding for restoration of the buildings The Premises shall be used by Lessee solely and
exclusively for offices,meeting rooms and associated activities of the City of Petaluma and non-
profit organizations such as the Petaluma Chamber of Commerce,Downtown Business
Association,Petaluma Visitors Bureau. ("Permitted Use"). Lessee shall not use the Premises for
any other use other than the Permitted Use without Lessor's prior written consent,which consent
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may be withheld by Lessor in its sole discretion. Lessee's is authorized to sublease the Premises
only to non-profit, tax-exempt organizations such as the local Chamber of Commerce,
Downtown Business Association and Visitors Bureau. Lessee acknowledges that the buildings
are eligible for inclusion on the National Register of Historic Places. Lessee agrees that all
rehabilitation, restoration and tenant improvements undertaken on the Premises shall be
conducted in accordance with the Secretary of the Interior's Guidelines for Historic Buildings
and applicable local building codes. Lessee further agrees not to nominate the Buildings for
inclusion on the National Register without the consent and cooperation of Lessor.
G. Restrictions on Use.
Lessee shall not permit any damage, nuisance or waste on the Premises; nor permit to be
placed upon the Premises any gasoline, diesel fuel, oil, other petroleum products,or any
hazardous or explosive material, waste or substance. In the event that Lessee engages in any
construction work on the Premises within 25 feet of the centerline of the tracks,then Lessee and
all employees, agents and contractors of Lessee shall comply with the restrictions stated in
Exhibit B - Working Procedures, that is attached to this Lease and incorporated herein by this
reference.
a. Regulatory Approvals. Lessee, at Lessee's sole expense, shall arrange for
the filing of any neap required under any subdivision map act and the preparation of any
environmental study required, or other requirements imposed by any governmental body having
jurisdiction over the Premises or Permitted Use. Lessor may terminate this Lease if any
governmental body seeks to impose any condition on approval of Lessee's use of the Premises
that will affect the Premises after termination of thus Lease or that will affect any other property
of Lessor. Lessee must pay all costs and expenses associated with any conditions imposed on
approval by any such governmental body.
b. Compliance with Laws. Lessee, at Lessee's expense, shall at all times
during the Term comply with all applicable laws,regulations,rules and orders with respect to
Lessee's use and/or improvement of the Premises,regardless of their effective date, including,
without limitation, those relating to construction, grading, signage, health, disability
accommodation (including the Americans with Disabilities Act), safety,noise, environmental
protection, waste disposal, and water and air quality,historic buildings codes and the Secretary
of the Interior's Guidelines for Historic Buildings. Lessee shall furnish satisfactory evidence of
such compliance upon request of Lessor. Failure to comply with historic building codes in the
restoration, renovation and construction of tenant improvements will be considered a default and
cause for termination of this lease.
C. Prior Rights. This Lease is made subject to all licenses, leases, easements,
restrictions, conditions, covenants, encumbrances, liens, and claims of title that may affect
Premises in effect as of the Effective Date of the Lease. The word"Lease"shall not be
construed as a covenant against the existence of any of these.
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7. Condition of Premises.
a. "AS IS" Rental. Lessor leases the Premises to Lessee on an "AS IS basis",
and Lessee acknowledges that Lessor has made no representations of any kind in connection
with soils, improvements, or physical conditions on the Premises, or bearing on Lessee's use of
the Premises, whether express or implied.
b. Inspections. Lessee shall be solely responsible for conducting any
inspections it may deem necessary or appropriate in determining whether to enter this Lease.
Lessee may examine and inspect all matters with respect to taxes, operating expenses, insurance
costs, bonds, permissible uses, historical uses, zoning, covenants, conditions and restrictions and
all other matters which in Lessee's judgment might bear upon the value and suitability of the
Premises for Lessee's purposes or Lessee's willingness to enter into this Lease. Lessee
acknowledges that Lessor has made no representations and warranties regarding these matters,
whether express or implied, and that Lessee has relied on its own inspections and examinations
in entering into this Lease. As of the Effective Date, Lessee shall be deemed fully satisfied with
the results of all of the inspections and examinations contemplated in this Section 7 and Lessee
be deemed to have accept the Premises "AS IS"with all faults.
8. Rent.
a. Monthly Rent.Commencing as of the Effective Date, Lessee shall pay to Lessor
as rent for the Premises the sum of twelve thousand dollars ($12,000)per year("Rent"). Rent
shall be payable monthly in advance to Lessor on the first day of each month,in lawful money of
the United States, at the address set forth in Section 11 below,without deduction, setoff,prior
notice or demand of any kind. If the Effective Date of this Lease is other than the first day of the
calendar month, Rent shall be prorated for the fractional month and the Rent for said fractional
month, together with the Rent for the first full month shall be payable in advance upon execution
of this Lease. Lessee agrees that its subleasing rental arrangements shall be restricted to the
rental amounts reasonably required to pay for its costs to Lease the Premises from Lessor and the
operating costs, common area maintenance costs and building maintenance costs that are its
responsibility under the terms of this Lease.
b. Use of Rent. Rent proceeds shall be used to offset Lessee's costs of
rehabilitating, operating,repairing and maintaining the Premises. To the extent that Lessee's
receipts of rents from any sublessees in any calendar year exceeds the sum of(1) one-twenty-
fifth of the amount necessary to amortize Lessee's actual out of pocket costs for the Tenant
Improvements over a 25-year period and(2)Lessee's actual costs for operating and maintaining
the Premises during that calendar year, and(3)the rents paid to Lessor during that calendar year,
Lessees must pay 50% of that amount to Lessor.
C. Audit. Lessee shall maintain full and adequate records to memorialize the actual
costs it incurs in the undertaking the Tenant Improvements as well as the funds it receives from
any sublessees. Lessee shall permit the authorized representatives of Lessor to inspect and
examine Lessee's books,records, accounts, documents,reports, contracts and any and all data
relevant to this Lease (collectively"Records'), at any reasonable time, for the purpose of
auditing and verifying any statements, invoices, accounts or bills developed by Lessee pursuant
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to this Lease, and shall provide such assistance as may be reasonably required in the course of
such inspection. Lessor, on behalf of it and its authorized representatives further reserves the
right to examine and re-examine said Records during the three (3) year period following
termination or expiration of this Lease. Lessee shall in no event dispose of, destroy, alter, or
mutilate said Records in any manner whatsoever for three (3) years after the expiration or
termination of this Lease.
9. Security Deposit.No security deposit shall be required under this Lease.
10. Late Charges, Interest.
a. Late Charges. If any installment of Rent or other sum due from Lessee is
not received by Lessor within ten (10) days of the date it is due, then Lessee shall pay to Lessor a
late charge equal to ten percent(10%) of such overdue amount. The parties hereby agree that
such late charge represents a fair and reasonable estimate of the costs Lessor will incur by reason
of late payment by Lessee which are impracticable to estimate. Acceptance by Lessor shall in no
event constitute a waiver of Lessee's default or breach with respect to such overdue amount or
prevent Lessor from exercising any other rights and remedies granted herein.
b. Taxes. Lessee shall pay, before they become delinquent, all taxes, if
applicable,charges, and assessments which are levied upon or assessed against any improvement
or personal property placed upon the Premises by Lessee. Lessee shall pay, before they become
delinquent, if applicable, any and all property taxes and/or possessory interest taxes, assessments
and/or supplemental taxes which are levied or assessed by any government entity on the
Premises or Lessee's possession and/or use thereof. In addition to the taxes and assessments
specified above,Lessee shall pay to Lessor, if applicable, any privilege, sales, gross income or
other tax (but not including federal or state income tax), imposed upon the Rent by any
government entity.
11. Notices.
All notices,payments, or other communications by either party to the other under this
Lease shall be in writing and shall be deemed to have been given or made on the date of service
if served personally or on the second business day after mailing if mailed to the party to whom
notice is to be given by first class mail, registered or certified, postage prepaid and properly
addressed as follows:
To Lessor: Northwestern Pacific Railroad Authority
C/o Golden Gate Bridge, Highway and Transportation District
P.O. Box 9000, Presidio Station
San Francisco, CA 94129-0601
Attention: Executive Director
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To Lessee:
City of Petaluma
11 English Street
Petaluma CA 94952
Attention: Executive Director,
Petaluma Community Development Commission
Either party may change its address by providing written notice to the other as provided
herein.
12. Tenant Improvements and other Alterations.
a. Tenant Improvements. The parties intend that Lessee will construct such
alterations to the Premises as necessary to rehabilitate and renovate the Premises for occupancy,
including seismic retrofit, in accordance with the Secretary of Interior's Guidelines for Historic
Buildings and applicable local building codes, at Lessee's sole cost and expense. The initial
improvement work on the buildings will be directed to preserving the existing buildings. In
addition, in consultation with the commuter rail district, Lessee may also complete certain
additions, such as restrooms and information kiosks, which may be required for future commuter
rail service. The foregoing improvements are referred to in this Lease as "Tenant
Improvements." Any Tenant Improvements made by Lessee shall be at no cost to Lessor, except
as the parties may otherwise expressly agree in writing, and shall be completed in accordance
with the requirements of subsection 12.b below. The initial budget for expenditures by the City
for studies,improvements and maintenance activities are included as Exhibit C of this Lease.
Upon final completion of improvements,the City will prepare a detailed listing of the actual cost
of improvements, on a form substantially similar to Exhibit D, and submit it to Lessor within
sixty days after the final completion and acceptance of improvements.
b. Other Alterations. Lessee shall not make or suffer to be made any other
rehabilitation,renovations, alterations, additions or improvements (collectively"Alterations")in,
on,or to the Premises without the prior written consent of Lessor,which consent shall not be
unreasonably withheld or delayed. Lessor hereby consents to those Alterations generally
required to rehabilitate and renovate the Premises and those tenant improvements necessary to
sublease the Premises. All Alterations shall be made in accordance with the Secretary of
Interior's Guidelines for Historic Buildings and in compliance with all other applicable building
codes. Prior to commencement of construction of Alterations to which Lessor has consented,
Lessee shall deliver to Lessor, and obtain Lessor's approval of, a detailed construction plan for
the Alterations at least sixty(60) days prior to the intended date of commencement of
construction,which approval shall not be unreasonably withheld or delayed. Prior to
commencement of construction, Lessee shall also obtain and deliver to Lessor copies of all city,
county, and/or other regulatory permits required for construction of the Alterations. Lessee shall
keep the Premises free and clear of all liens of any kind. Lessee shall give Lessor at least ten
(10) days' prior written notice of commencement of any work on Alterations,so that Lessor may
post appropriate notices of non-responsibility, and Lessee hereby grants permission to Lessor to
enter onto the Premises for that purpose. Lessee, shall require Lessor to be named as an
additional party on a required performance bond equal to 125% of the total estimated cost of any
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proposed Alterations prior to commencement of work thereon by Lessee's contractor. All work
on Alterations shall be performed in a workerlike manner and shall comply with all applicable
governmental permits, laws, ordinances and regulations,including,but not limited to, any
procedures promulgated by Lessor. All work on Alterations shall be completed by contractors
licensed in the State of California who shall have in place prior to commencement of work the
policies of insurance required of Lessee by Section 19 below, as evidenced by a certificate of
insurance delivered to and approved by Lessor. Lessor shall have the right to enter onto the
Premises and to inspect construction of the Alterations during construction. All Alterations and
fixtures,whether temporary or permanent in character, made in or upon or added to the Premises
by Lessee shall be Lessor's property at the end of the Lease Tenn without compensation to
Lessee, subject to the provisions of Section 25 below.
13. Option to Renew.
a. Subject to the terms and conditions set forth in this Section, Lessee hereby
is granted the right and option("Renewal Option") to extend the term of this Lease for three
additional five-year ten-n(s) ("Renewal Term(s)"). Lessee shall exercise the Renewal Option, if
at all, by giving written notice to Lessor of Lessee's election to extend the Term no earlier than
one hundred and eighty(180) days prior to the end of the Lease Term and no later than one
hundred and twenty (120) days prior to the end of the Lease Term. Lessee shall be entitled to
exercise the Renewal Option only if:
(1) Lessee has complied with all terms and conditions of the Lease
prior to the date of exercise; and,
(2) Lessee is not at the time of exercise in default under the Lease,
(3) Lessee has completed renovation and rehabilitation of the
Premises, including tenant improvements, all in accordance with the Secretary of Interior's
Guidelines for Historic Buildings.
b. The Renewal Term(s), including rent, shall be on the same terms and
conditions of the Lease.
14. Utilities.
Lessee shall arrange and pay for all utilities, if any,including without limitation,water,
electric, gas, garbage, communications and sewer services,to be used in connection with this
Lease. Lessee is responsible for any and all utility connections to the Premises. In the event that
Lessor incurs any costs in helping facilitate the provision of utilities to the Premises, Lessee shall
reimburse Lessor for any and all such costs.
15. Maintenance and Repair.
Lessee shall keep the Premises, including any improvements located thereon,in safe
condition and in good order, condition and repair at all times during the Lease Term at Lessee's
sole cost and expense. Lessee shall, at Lessee's sole expense, repair any area damaged by
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Lessee,Lessee's agents, employees and visitors. Lessee acknowledges that Lessor is ,under no
duty to repair or make improvements to the Premises. If Lessee fails to perform Lessee's
obligations under this Section 16, Lessor may enter upon the Premises after thirty(30)days prior
written notice to Lessee(except in the case of an emergency, in which case no notice shall be
required) and perform such obligations on Lessee's behalf and expense as provided in Section
25(a) of this Lease. At the end of the Lease Tenn, Lessee shall surrender the Premises to Lessor
with all renovation and additions made under the terms of this lease in good and tenantable
condition, ordinary wear and tear excepted.
16. Liens.
Lessee shall not permit any mechanics' or materialmen's liens, stop orders or other liens
(collectively,"Liens")to be filed against the Premises nor against Lessee's leasehold interest
therein by reason of labor or materials furnished to the Premises at Lessee's instance or request. .
If any such liens are filed against the Premises,Lessee shall cause the same to be discharged of
record either by payment of the claim or by posting and recording the bond contemplated by
California Civil Code Section 3143,within twenty(20)days after demand by Lessor. Lessee
shall indemnify,hold harmless, and defend Lessor from and against any such liens.
17. Indemnification.
Lessee shall indemnify, defend and hold harmless the Northwestern Pacific Railroad
Authority,the Golden Gate Bridge,Highway and Transportation District, the County of Marin,
the North Coast Railroad Authority,the Union Pacific Railroad Company, the successors and
assigns of any of them, any railroad company operating on the Premises, and their respective
directors, officers, employees, agents, contractors (including, but not limited to, any person that
may be operating Lessor's railroad tracks and services) and any other person acting on Lessor's
behalf(collectively, "Indemnitees") from and against any and all liabilities,penalties, losses,
damages, costs, loss of rent, expenses,demands, causes of action, claims or judgments
(collectively, "Liabilities") arising out of or in connection with(a)the use,maintenance,
occupation, alteration, or improvement of the Premises by Lessee, (b) any act, omission or
neglect of Lessee,Lessee's officers, employees, agents, servants, sublessees, concessionaires,
contractors or visitors, and/or(c) any breach or default by Lessee of any of the terms, covenants
or conditions of this Lease; provided,however that with respect to any Liability under sub-
sections (a) and/or(b) above, Lessee shall not be obligated to indemnify any Indemnitee for any
Liability caused by the gross negligence or willful misconduct of that Indemnitee. The duty to
defend established herein shall include payment of all legal costs and charges, including
reasonable attorney's fees, and shall remain in effect notwithstanding any claim of gross
negligence or willful misconduct by Lessee against any Indemnitee. Lessee waives any and all
rights to any type of express or implied indemnity against Indemnitees. The provisions of this
Section shall survive the expiration or termination of this Lease.
18. Environmentallmpainnent.
If during the term of this Lease, Lessee knows or has cause to believe that any Hazardous
Materials, as defined below, have come to be located in, on, under or about the Premises, other
than as previously consented to by Lessor, Lessee shall immediately give Lessor written notice
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thereof, together with a copy of any statement, report, notice, registration, applications, permit,
business plan, license, claim, action or proceeding given to, or received from, any governmental
authority or private party concerning said Hazardous Materials.
Should any discharge, leakage, spillage, or emission of any Hazardous Materials, as
defined below, or pollution of any type occur upon or from the Premises during the Tenn,
Lessee, at Lessee's expense, shall clean all property affected thereby to the satisfaction of Lessor
(insofar as the property owned or controlled by Lessor is concerned) and any governmental body
having jurisdiction thercover.
Lessee shall indemnify, hold harmless, and defend each and all of the Indemnitees from
and against all liability, claims, costs and expenses (including, without limitation, any fines,
penalties,judgments, litigation costs, attorneys' fees, and consulting, engineering and
construction costs) incurred by such Indemnitees or any of them as a result of Lessee's breach of
this Section, or as a result of the presence, disposal, storage, generation or release on the
Premises at any time during the term of this Lease of any"hazardous materials," "hazardous
substances," "hazardous wastes" or "toxic substances" as those terms may be defined in any
federal, state or local legislation currently existing or enacted in the future (collectively
"Hazardous Materials"), regardless of whether such liability, cost or expense arises during or
after the Lease Term, and regardless of whether such liability, cost or expense is contributed to
or caused by the negligence, active or passive, of Lessor.
The provisions of this Section shall survive the expiration or termination of this Lease,
19. Insurance.
a. Policies of Insurance. Lessee shall maintain in full force and effect during
the term of this Lease and any extension hereof, the following insurance:
(1) Workers' Compensation. As required by Section 1860 of the
California Labor Code (Chapter 1000, Statutes of 1965), or any subsequent amendments or
successor acts thereto governing the liability of employers to their employees, the Lessee shall
secure Workers' Compensation coverage with an Employer's Liability limit of$2,000,000.
Lessee shall insure the procurement and maintenance of such insurance by all contractors or
subcontractors engaged on the Premises. The policy shall contain a waiver of subrogation in
favor of the Northwestern Pacific Railroad Authority, the Golden Gate Bridge, Highway and
Transportation District, the County of Marin, the North Coast Railroad Authority, the Union
Pacific Railroad Company, the successors and assigns of any of them, any railroad company
operating on the Premises, and their respective directors, officers, employees, agents, contractors
(including, but not limited to, any person that may be operating Lessor's railroad tracks and
services) and any other person acting on Lessor's behalf, as they now or as they may hereafter be
constituted singly,jointly or severally.
(2) Commercial General Liability. Lessee shall, at its own cost and
expense,procure and maintain Commercial General Liability or Garage Liability insurance,
whichever is applicable. The policy shall include as additional insureds the Northwestern Pacific
Railroad Authority, the Golden Gate Bridge, Highway and Transportation District, the County of
9
1031190.1
DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
Marin,the North Coast Railroad Authority, the Union Pacific Railroad Company, the successors
and assigns of any of them, any railroad company operating on the Premises, and their respective
directors,officers, employees, agents, contractors (including, but not limited to, any person that
may be operating Lessor's railroad tracks and services) and any other person acting on Lessor's
behalf. The policy shall be primary and contain cross liability and severability of interest
clauses.
The policy shall have a combined single limit of Two Million Dollars ($2,000,000) for
bodily injury and property damage per occurrence. This insurance shall include but not be
limited to: Premises and operations; contractual liability covering the indemnity provisions
contained in this Lease;personal injury; explosion, collapse and underground coverage; products
and completed operations and broad form property damage. The policy shall contain a waiver of
subrogation in favor of the Northwestern Pacific Railroad Authority, the Golden Gate Bridge,
Highway and Transportation District, the County of Marin, the North Coast Railroad Authority,
the Union Pacific Railroad Company, the successors and assigns of any of them, any railroad
company operating on the Premises, and their respective directors, officers, employees, agents,
contractors (including,but not limited to, any person that may be operating Lessor's railroad
tracks and services) and any other person acting on Lessor's behalf, as they now or as they may
hereafter be constituted singly,jointly or severally.
If food or alcoholic beverages are to be served on the Premises, the policy shall include
coverage of any claims founded upon the use of food or food products and liquor law liability
with limits of not less than Two Million Dollars ($2,000,000).
(3) Personal Property Insurance. Lessee shall obtain and maintain
insurance coverage on all of Lessee's personal property, trade fixtures and Lessee owned
alterations and utility installations. Such insurance shall be full replacement cost coverage with a
deducible of not to exceed$2,500 per occurrence. The proceeds from any such insurance shall
be used by Lessee for the replacement of personal property, trade fixtures and Lessee owned
alterations and utility installations.
(4) Railroad Protective Liability Insurance. Upon request from
Lessor, Lessee shall obtain and maintain, with respect to the operations it or any subcontractors
perform above the railroad tracks or within fifty(50) feet horizontally of the railroad tracks,
Railroad Protective Liability Insurance with the Insurance Services Offices (ISO)/Railroad
Insurance Management Association(RIMA) form with pollution coverage for job site fuels and
lubricants. The Northwestern Pacific Railroad Authority, the Golden Gate Bridge, Highway and
Transportation District, the County of Marin,the North Coast Railroad Authority, the Union
Pacific Railroad Company, the successors and assigns of any of them, any railroad company
operating on the Premises, and their respective directors, officers, employees, agents, contractors
(including,but not limited to, any person that may be operating Lessor's railroad tracks and
services) and any other person acting on Lessor's behalf shall be named as additional insureds on
said policy. The policy shall have limits of liability of not less than Two Million Dollars
($2,000,000)per occurrence, combined single limit, for losses arising out of injury to or death of
all persons, and for physical loss of or damage to or destruction of property, including the loss of
use thereof, and a Five Million Dollars ($5,000,000) annual aggregate shall apply.
10
1031 190.1
DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
(5) Automobile Liabilily Insurance. Lessee shall, at its own cost and
expense, procure and maintain Automobile Liability Insurance providing bodily injury and
property damage with a combined single limit of at least Two Million Dollars ($2,000,000)per
occurrence for all owned, non-owned, and lured automobiles. The insurance shall provide
contractual liability covering all motor vehicles and mobile equipment to the extent coverage
may be excluded from general liability insurance. Such insurance shall include as additional
insureds the Northwestern Pacific Railroad Authority, the Golden Gate Bridge, Highway and
Transportation District, the County of Marin, the North Coast Railroad Authority, the Union
Pacific Railroad Company, the successors and assigns of any of them, any railroad company
operating on the Premises, and their respective directors, officers, employees, agents, contractors
(including, but not limited to, any person that may be operating Lessor's railroad tracks and
services) and any other person acting on Lessor's behalf, as they now or as they may hereafter be
constituted singly,jointly or severally. This policy shall contain a waiver of subrogation in favor
of the Northwestern Pacific Railroad Authority, the Golden Gate Bridge, Highway and
Transportation District, the County of Marin, the North Coast Railroad Authority, the Union
Pacific Railroad Company, the successors and assigns of any of them, any railroad company
operating on the Premises, and their respective directors, officers, employees, agents, contractors
(including, but not limited to, any person that may be operating Lessor's railroad tracks and
services) and any other person acting on Lessor's behalf, as they now or as they may hereafter be
constituted singly,jointly or severally.
(6) Additional Policies of Insurance. In addition to the requirements
described above, Lessee shall maintain any other insurance that maybe required by law, statute
or govermnental regulations.
b. Evidence of Insurance. Prior to occupying the Premises, Lessee shall file
a Certificate(s) of Insurance with the Lessor evidencing the required coverage and
endorsement(s) and upon request, a certified duplicate original of any of those policies. Said
Certificate(s) shall stipulate:
(1) The insurance company(ies) issuing such policy(ies) shall give
written notice to the Lessor of any material alteration, cancellation, non-renewal, or reduction in
aggregate limits, if such limits apply, and provide at least thirty(30) days' notice of cancellation.
Lessee shall, at least thirty (30) days prior to the expiration of such policies furnish Lessor
evidence of renewal or insurance binders evidencing renewal thereof.
(2) That the policy(ies) is Primary Insurance with respect to any policy
of insurance maintained by any insured, and the insurance company(ies) providing such
policy(ies) shall be liable thereunder for the full amount of any loss or claim up to and including
the total limit of liability, without right of contribution from any other insurance effected or
which may be effected by the Indemnitees.
(3) The policy(ies) shall also stipulate: inclusion of the Indemnitees as
additional insureds shall not in any way affect rights of Indemnitees in respect to any claim,
demand, suit or judgment made,brought or recovered against the Lessee. Said policy shall
protect Lessee and the Indemnitees in the same manner as though a separate policy had been
issued to each, but nothing in said policy shall operate to increase the insurance company's
11
1031190.1
DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
liability as set forth in its policy beyond the amount or amounts shown or to which the insurance
company would have been liable if only one interest had been named as an insured.
(4) The insurance policy(ies) shall be written by an insurance
company or companies acceptable to the Lessor. Such insurance company shall be authorized to
transact business in the state of California.
Licensee may self-insure any or all of the above-required coverages, upon proof of
adequately funded reserves, either through a shared pool of reserves or through its own reserves.
Upon request of Licensor, Licensee must provide Licensor with evidence of the existence of
sufficient reserves to fund the coverage levels required under this Agreement.
C. Failure to Maintain Insurance. Failure to procure or maintain insurance
required under this Section shall constitute a default of this Lease.
d. Third Party Beneficiaries. All Indemnitees who are not expressly parties
to this Lease shall be considered third party beneficiaries under this Lease for purposes of
enforcing against Lessee any rights to indemnification and insurance granted in this Lease, and
shall be entitled to seek attorney's fees and costs as provided in Section 31 below in any dispute
arising from the enforcement of said rights.
20. Noise Levels Near Railroad Tracks.
Lessee hereby recognizes and acknowledges that railroad tracks may be located on or
adjacent to the Premises, and that the operation of trains over the tracks does and shall produce
noise levels which may be considered objectionable by Lessee or employees, agents, sublessees,
or invitees of Lessee. Therefore, Lessee agrees that no legal action or complaint of any kind
whatsoever shall be instituted against Lessor on Lessee's behalf as a result of such noise levels
including any claims of nuisance or trespass. Lessee shall indemnify and save harmless Lessor
against any loss, damage, liability or expense either might incur as a result of such action being
taken by Lessee's employees, agents, sublessees or invitees.
21. Reservations.
This Lease is made subject and subordinate to the prior and continuing right and
obligation of Lessor, its successors and assigns, to use the.Premises in the performance of its
transportation operations, which may include, but are not limited to, any activities relating to the
study, design, development, construction, maintenance, operation, mapping, testing, or surveying
of transportation systems or transit-related projects. There is reserved unto Lessor, its successors
and assigns, the right to (a) construct, reconstruct, maintain, operate and use existing facilities
and appurtenances, including, without limitation, existing transportation, communication, fiber
optic, railroad track and pipeline facilities and appurtenances in, upon, over, under, across and
along the Premises, and (b) construct, reconstruct, maintain, review and relocate such additional
facilities of the same character,provided that such additional facilities do not unreasonably
interfere with Lessee's occupancy of the Passenger Depot Building, the Baggage Shed or the
Freight Shed and provided that such additional facilities receive all required land use approvals
from the City of Petaluma and/or other agencies having jurisdiction over such a project.
12
1031190.1
DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
22. Mineral Rights.
Lessor also reserves for itself and those to whom it grants such right the title and
exclusive right to all of the minerals and mineral ores of every kind and character now known Co-
exist or hereafter discovered upon, within or underlying the Premises, or that may be produced
therefrom, including, without limiting the generality of the foregoing, all petroleum, oil, natural
gas and other hydrocarbon substances and products derived therefrom, together with the
exclusive and perpetual right thereto, without, however, the right to use or penetrate the surface
of, or to enter upon the Premises within five hundred feet (500') of the surface thereof to
extricate or remove the same.
23. Default.
a. Defaults. The occurrence of any of the following shall constitute a
material breach and default("Default") of this Lease by Lessee:
(1) Any failure by Lessee to pay when due any of the Rent or other
charges payable by Lessee;
(2) A failure by Lessee to observe or perform any other provision of
this Lease to be observed or performed by Lessee when such failure is not corrected within ten
(10) days after written notice thereof from Lessor; or if such failure cannot be cured within this
ten(10) day period, as determined by Lessor in its reasonable discretion, if such cure is not
commenced within thirty(30) days of Lessor's written notice and thereafter diligently pursued to
completion;
(3) The abandonment or the vacation of the Premises by Lessee for a
period of more than fifteen(15) consecutive days;
(4) The happening of any of the following events: (a) the filing or
institution by Lessee of any proceeding under the Bankruptcy Act and any amendment thereto,
or any other federal or state act now or hereafter relating to the subject of bankruptcy,
insolvency, arrangement, reorganization, or other form of debtor relief, (b) the institution or
filing of any involuntary proceeding against Lessee raider any of the aforementioned laws unless
such proceeding is dismissed within thirty(30) days thereafter, (c) an adjudication of bankruptcy
or a finding or judgment of insolvency of Lessee, (d) an assignment for the benefit of creditors
by Lessee, (e) the levy of a writ of execution of the business of Lessee or the assets of Lessee
located on the Premises which is not discharged within ten (10) days after the date of said levy,
or(0 the appointment of a receiver to take possession of any property of Lessee.
(5)Failure to comply with historic building codes in the restoration,
renovation and construction of tenant improvements.
24. Remedies.
In the event of a Default by Lessee, Lessor may, at any time thereafter:
13
103119a.1
DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
a. Cure said Default by Lessee at Lessee's expense. Lessee shall,upon
demand, immediately reimburse Lessor for the cost of such cure together with interest at the
Interest Rate from the date of the expenditure therefor by Lessor until such reimbursement is
received by Lessor.
b. Maintain Lessee's right to possession in which case this Lease shall
continue in effect whether or not Lessee shall have vacated or abandoned the Premises, in which
event Lessor shall be entitled to enforce all of Lessor's rights and remedies under this Lease,
including the right to recover the Rent as it becomes due hereunder as provided in California
Civil Code Section 1951.4. Acts of maintenance or preservation, efforts to re-let the Premises, or
the appointment of a receiver upon the initiative of Lessor to protect Lessor's interest under this
Lease shall not constitute a termination of Lessee's right to possession. No act by Lessor other
than giving written notice to Lessee will terminate this Lease.
C. Terminate Lessee's right to possession of the Premises by any lawful
means, in which case this Lease shall tenninate and Lessee shall immediately surrender
possession of the Premises to Lessor. In such event Lessor shall be entitled to recover from
Lessee the sum of all amounts set forth in California Civil Code Section 1951.2(a), including
without limitation, the worth at the time of award of the amount by which all unpaid rent for the
balance of the Tenn of this Lease after the time of award exceeds the amount of such rental loss
that Lessee proves could be reasonably avoided, and all other damages incurred by Lessor by
reason of Lessee's default including, without limitation, the cost of recovering possession of the
Premises, and expenses of re-letting such as renovation of the Premises and real estate
commissions and finder's fees actually paid for such re-letting. The "worth at the time of award"
shall be computed in the manner provided in California Civil Code Section 1951.2(b)or its
successor statute. For the purpose of determining unpaid rent under this paragraph,the rent
reserved in this Lease shall be deemed to be the sum of all then unpaid monetary obligations
owed under this Lease.
d. Pursue any other remedy now or hereafter available to Lessor under the
laws of California.
Termination of this Lease under this Section or for any reason whatsoever shall not
release either party from any liability or obligation arising from an event which may have
occurred before termination(including,but not limited to payment of all Rent due but unpaid as
of the date of termination), or from actions that, under the expressed terms of this Lease, must be
performed.
25. Surrender of the Premises; Holding Over.
a. Except as provided for in Section 4 of this Lease, upon termination of this
Lease, Lessee shall leave the Premises in a neat and clean condition satisfactory to Lessor and
free of all personal property of Lessee. All Tenant Improvements, repairs, alterations and/or
other improvements made by Lessee shall become the property of Lessor,provided that Lessor
may,by written notice given to Lessee on not less than ten(1.0)days prior to the expiration of the
Lease, require Lessee to remove any such Tenant Improvements, and Alterations from the
Premises and to restore the Premises to their original condition(normal wear and tear excepted)
14
1031190.1
DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
prior to termination of this Lease. If Lessee fails to do so, Lessor may perform such removal and
restoration work in which case Lessee shall pay Lessor within thirty (30) days after demand
therefor(1) an amount equal to the rent(as in effect immediately before termination) for the
period during which such removal is accomplished to compensate Lessor for the loss of rent to
Lessor resulting from the unavailability of the Premises for leasing to another Lessee during such
time and(2)the cost of removal of such improvements. Lessor shall use reasonable diligence on
the removal of such Tenant Improvements and Alterations.
b. If Lessee,without Lessor's written consent,remains in possession of all
or part of the Premises after termination or expiration of this Lease, such occupancy shall be
construed to be a tenancy from month-to-month, subject to the terms and conditions of this
Lease, except that the Base Rent shall automatically increase to 200% of the Base Rent in effect
immediately prior to such termination or expiration.
26. Condemnation.
If all or part of the Premises is acquired by eminent domain or by purchase in lieu
thereof, Lessee shall have no claim to any compensation awarded for the taking of the Premises
or any portion thereof, including Lessee's leasehold interest therein or any bonus value of this
Lease, or to any compensation paid as severance damages, or for loss of or damage to Lessee's
Alterations or improvements, except as may be expressly provided in Section 4 of this Lease..
27. Assignment and Subletting.
Lessee shall not assign, sublet or encumber or otherwise transfer its interest in this Lease
without the prior written consent of Lessor, except as expressly provided in Section 5 of this
Lease. Lessor shall not unreasonably withhold consent to any assignment, encumbrance or
transfer in the event the proposed sublessee or assignee ("Transferee")meets the definitions of
permitted sublessee outlined in Section 5 of this Lease.
28. Damage.
a. Scope of Damage. Lessee shall notify Lessor in writing immediately upon
the occurrence of any damage to the Premises which makes the Premises untenantable (a
"Casualty"). Such damage shall be deemed partia] if it can be repaired and the Premises made
tenantable within 180 days and does not occur during the last year of the Term ("Partial
Damage"). All damage other than Partial Damage shall be deemed to be total destruction ("Total
Destruction").
b. Total Destruction. In the event of Total Destruction, the Lease shall
terminate as of the date of the Casualty("Casualty Date").
C. Partial Damage. In the event of Partial Damage, Lessor shall elect in a
written notice to Lessee within sixty(60) days of the Casualty Date whether to restore the
Premises, at Lessor's expense,to their condition prior to the Casualty Date. If Lessor elects to
restore the Premises, Lessor shall diligently pursue such restoration to completion at Lessor's
sole cost and expense, provided that Lessee shall be responsible for the restoration, at Lessee's
15
1031190.1
DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
expense, of Lessee's fixtures, equipment and other improvements installed by Lessee. Upon such
an election, this Lease will remain in effect. If Lessor elects not to restore the Premises, Lessee
shall elect within thirty(30) days of receipt of Lessor's election whether to restore the Premises
at Lessee's sole cost and expense. If Lessee elects to restore the Premises, Lessee shall diligently
pursue such restoration to completion in compliance with the provisions of Section 12 above.
Upon such an election, this Lease will remain in effect. If Lessee elects not to restore the
Premises, this Lease shall terminate as of the date of Lessee's election.
d. Lessee's Costs. If Lessor restores the Premises, Lessee shall reimburse
Lessor for the deductible or self-insured retention under any of Lessor's insurance policies and,
if the Casualty was caused or contributed to by Lessee or Lessee's invitees, the excess of the cost
to restore the Premises over the amount of the insurance proceeds from the Lessor's insurance.
Lessee shall have no right to any insurance proceeds other than proceeds that Lessee obtains with
respect to Lessee's personal property and fixtures. If this Lease is not terminated, the base Rent
shall abate in proportion to the Premises damaged until the Premises are restored.
30. Barricades.
If requested by Lessor, Lessee shall install and maintain barricades, fences, and fence
gates of a size and form satisfactory to Lessor at such locations as may be designated by Lessor
at any time while this Lease is in effect, all at Lessee's expense and to Lessor's satisfaction.
29. Costs.
No costs shall be required to be paid by Lessee for review of the Lease application,
design and construction plans, preparation of the Lease, and any inspection of construction,
including,but not limited to, expenses incurred by Lessor.
30. Attorneys Fees.
If either party brings any action against the other to enforce any provision of this Lease or
collect any sum due hereunder, or if Lessor brings an action for unlawful detainer of the
Premises, the prevailing party shall be entitled to recover its costs, including reasonable
attorneys' fees, in addition to any other remedies to which it may be entitled.
31. Miscellaneous Provisions.
a. Non-Waiver. Lessor's failure to enforce or exercise its rights with respect
to any provision hereof shall not be construed as a waiver of such rights or of such provision.
Acceptance of Rent or any other sum shall not be a waiver of any preceding breach by Lessee of
any provision hereof, regardless of Lessor's knowledge of such preceding breach at the time of
acceptance of such Rent; nor shall such acceptance be a waiver in any way of Lessor's right to
terminate this Lease for any reason.
b. Time of Essence. Time is of the essence of each provision of this Lease.
Any reference to "days" shall mean calendar days except as otherwise expressly provided in this
Lease.
lb
1031190.1
DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
C. Entire Agreement and Amendment. This Lease sets forth the entire
agreement between the parties with respect to the leasing of the Premises and supersedes all prior
and/or contemporaneous agreements, communications, and representations, oral or written,
express or implied, since the parties intend that this be an integrated agreement. This Lease shall
not be modified except by written agreement of the parties.
d. Successors and Assigns. Subject to the provisions of this Lease relating to
assignment,mortgaging and subletting, this Lease shall bind the heirs, executors, administrators,
successors and assigns of any and all of the parties hereto.
e. Authority. Each individual executing this Lease on behalf of Lessee
represents and warrants that he or she is duly authorized to execute and deliver this lease on
behalf of Lessee, and that this Lease is binding upon Lessee in accordance with its terms.
Lessor, as a condition precedent to this Lease, may require corporate or partnership resolutions
as are reasonably necessary to establish the authority of Lessee to execute this Lease.
£ Governing Law. This Lease shall be governed by and construed in
accordance with the laws of the State of California as applied to contracts that are made and
performed entirely in California.
g. Captions. All captions and headings in this Lease are for the purposes of
reference and convenience and shall not limit or expand the provisions of this Lease.
h. Third P Beneficiaries. The Indemnitees specified in Section 17 who
are not expressly parties to this Lease shall be deemed third party beneficiaries under this Lease
for purposes of enforcing any rights to indemnification and insurance granted in Sections 17, 18
and 19 of this Lease, and shall be entitled to seek attorneys fees and costs as provided in Section
31 above in any dispute arising from the enforcement of said rights.
i. Brokers. No brokers fees are associated with this lease. Lessor and Lessee
agree to indemnify, defend and hold the other party harmless from and against any claims and
suits made by any broker, agent or other person claiming a commission or other form of
compensation against the other party by virtue of having dealt with Lessor or Lessee, as the case
maybe,with regard to this Lease.
j. Counterparts. This Lease may be entered into in counterparts, each of
which shall be deemed an original but both of which together shall be deemed a single
agreement.
IN WITNESS WHEREOF, the parties hereto have executed, or have caused to be
executed, this Lease on the day and year first above written.
17
1031190.1
DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
Lessor: Lessee:
NORTHWESTERN PACIFIC PETALUMA COMMUNITY
RAILROAD AUTHORITY DEVELOPMENT COMMISSION
By: 0, By:��, a,, f T ,CIA,
y�
e i Kupers lit] Michael Bierman,
Executive Direct r Executive Director
APPROVED AS TO FORiTI:
i Attorney for the Authority ?1'n'mission Attorney
ATTEST:
BY-
Jal,/ S. Tarantino
Selgretary of the Authority
18
1031190.1
DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
EXHIBIT A
DESCRIPTION OF PREMISES
19
1031190,1
DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
EXHIBIT A
All that portion as described in the Deed to Peter Donahue by Deed recorded March 13, 1971 in
Book 33 of Deeds at Page 82, Sonoma County Records.
EXCEPTING THEREFROM all that portion described in the deed to the City of Petaluma, dated
May 3, 1972,recorded October 17, 1972 in Book 2703 of Official Records at page 12, Sonoma
County Records.
ALSO EXCEPTING THEREFROM the Southwesterly 315 feet of land described in deed
recorded June 15, 1908,Deed Book 249,Page 145, Records of said County.
APN 007-131-004
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Exhibit B
Worldng Procedures
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DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
Working Procedures
Procedures for Construction Work within
25 feet of the Centerline of the Track
1. All costs related to Lessee's operations upon Premises shall be at Lessee's expense. Work
shall be done at such times and in such manner as not to interfere with the current or future
use of Premises. Lessee shall be responsible for the provision of barriers, directions, signage,
and other forms of notice to the general public to assure the safe, smooth, and uninterrupted
flow of traffic around Project/Work site and on and about Premises. Lessee shall keep
Lessor's Premises in a reasonably neat and safe condition failing which Lessor, after twenty-
four(24)hours prior notice to Lessee, may do so at Lessee's expense.
2. Lessee shall comply with the regulations of the instructions of Lessor's representatives
relating to the proper manner of protecting the tracks, pipelines, wire lines, signals, and all
other property at said location, the traffic moving on such tracks, and the removal of tools,
equipment, and materials.
3. Work shall be performed in a good and worker-like manner satisfactory to Lessor. Since
there is the possibility of the existence of pipelines or other structures beneath Premises, if
Lessee should excavate or drill, then Lessee's forces shall.explore such structures with hand
tools to a depth of at least eight feet (8') below the surface of the ground or, at Lessee's
option, use suitable detection equipment prior to drilling or excavating with mechanized
equipment. Absence of markers does not constitute a warranty by Lessor of no subsurface
installations. It shall be Lessee's responsibility to determine the existence of any
underground facilities and Lessee shall call Underground Service Alert at (800) 642-2444
prior to beginning Work.
4. Lessee shall telephone Qwest Communications, Inc., at (800) 283-4237 (a 24-hour number)
to determine whether a telecommunications system is buried anywhere on the property. If
there is, Lessee shall telephone the owner of the system designated by Lessor, arrange for a
cable locator and make arrangements for relocation or other protection for the system prior to
beginning any Work.
5. Any open holes shall be satisfactorily covered at all times when Lessee's forces are not
physically working in the actual vicinity. Upon completion of Work, all holes will be filled
in to meet the surrounding ground level with clean, compacted, earthen material and the
property left in a neat and safe condition reasonably satisfactory to Lessor.
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b. Lessee agrees to reimburse Lessor for the cost and expense to Lessor of furnishing any
materials or performing any labor in connection with the use of Premises, including, but not
limited to, the installation and removal of such false work and other protection beneath or
along the railroad tracks, and the furnishing of such security persons, flaggers, and inspectors
as Lessor deems necessary. Prior to incurring any cost or expense, Lessor shall reasonably
notify Lessee of the same. Said reimbursement shall be paid by Lessee to Lessor within
thirty(30) days after presentation of a bill.
7. Lessee shall fully pay for all materials joined or affixed to Premises, and shall pay in full all
persons who perform labor on Premises. As Lessor is a public entity, its property is not
subject to mechanics' or materialmen's liens, and nothing in this Permit shall be construed to
make its property subject to such liens. However, if any such liens are filed, Lessee shall
immediately remove them at Lessee's own expense, and shall pay any judgment which may
be entered. Should Lessee fail, neglect, or refuse to do so, Lessor, after 48 hours prior notice
to Lessee, shall have the right to pay any amount required to release any such liens, or to
defend any action brought, and to pay any judgment entered. Lessee shall be liable to Lessor
for all costs, damages, reasonable fees, and any amounts expended in defending any
proceedings or in the payment of any of said liens or any judgment. Lessor may post and
maintain upon Premises notices of non-responsibility as provided by law.
8. Lessee shall cooperate with Lessor in making any tests Lessor requires of any installation or
condition wlmich in Lessor's reasonable judgment may have an adverse effect on any of the
facilities of Lessor. All costs incurred by the tests, or any corrections required as a result of
such tests, shall be borne by Lessee.
9. Lessee shall take protective measures necessary to keep Lessor's facilities, including track
ballast, free of sand or debris resulting from its use of Premises. Should any damage occur to
Lessor's facilities as a result of Lessee's use of Premises, Lessee shall immediately notify
Lessor. Any damage to Lessor's facilities resulting from Lessee's use of Premises will be
repaired or replaced by Lessor at Lessee's sole cost and expense, which Lessee shall pay to
Lessor promptly upon demand.
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DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
Exhibit C
Initial Improvement Budget
Phase I: Exterior Improvements: Cost estimates for Phase I work is shown below. The work
includes the following:
• Dry Rot/Stucco Repair: removing all dry rot and repairing the stucco and installing metal
flaslungs/caps.
• Window/Door Repair: repairing all windows and doors.
• Painting: entire exterior and sealing.
• Roofing: Removing all three building roofs, seismically stabilizing with plywood,
installing a new membrane, cleaning the roof tiles and replacing them. Installing new
gutters and downspouts.
• Engineering/Architectural Design $ 50,000
• Site Clearing/NCRA Relocation $ 20,000
• City Fees/Permits $ 5,000
• Base Construction $530,000
• Construction Contingency- 10% $ 53,000
• Project Management & Inspection $ 30,000
• General City-Wide CIP Overhead $ 14,000
Subtotal Phase 1: Exterior Improvements $702,000*
*This estimate should be increased by approximately 5% for each year
construction is delayed beyond 2003.
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DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
Phase II — Interior Improvements: The next phase of improvements is for the building
interiors. Architectural Resources Group (ARG) will perform an assessment of the building
interiors and develop a detailed budget and work plan. The preliminary budget estimate is as
follows:
Estimated Phase II Budget
• Engineering/Architectural Design $ 50,000
• Base Construction Estimate $400,000
• Construction Contingency- 20% $ 80,000
• Project Management& Inspection $ 40,000
• General City-Wide CIP Overhead S 30,000
Subtotal Phase II: Interior Improvements $600,000*
*This estimate should be increased by approximately 5% for each year
construction is delayed beyond 2003.
Phase III —Landscape & Parking Improvements: A landscape plan for the site will also
be undertaken and a budget work plan will be presented to the PCDC in the winter for
further consideration. The preliminary budget estimate is as follows:
Estimated Phase III Budget
• Engineering/Landscape Design $ 80,000
• Base Construction Estimate $500,000
• Construction Contingency- 20% $100,000
• Project Management& Inspection $ 40,000
• General City-Wide CIP Overhead $ 35,000
Subtotal Phase III: Landscape Improvements $755,000*
*This estimate should be increased by approximately 5% for each year
construction is delayed beyond 2003.
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1031190.1
DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
Summary IP Budget for All Phases:
Subtotal Phase L• Exterior Improvements $702,000
Subtotal Phase II: Interior Improvements $600,000
Subtotal Phase III: Landscape Improvements $755,000
Total Estimated Construction Budget-All Phases: $2.057,000
Additional Expenses Associated with Project:
Lease of 405 D Street for Interim NCRA/NWPY
Relocation:
$20,000/year x 5 years(estimated)=$100,000 $100,000
Grand Total Estimated Project Expenses: $29157,000
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DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
EXHIBIT D
ACTUAL CAPITAL EXPENDITURES & LEASE COSTS
(All Phases of Construction & All Lease Costs)
• Engineering/Architectural Design $
• Site Clearing/NCRA Relocation $
• City Fees/Permits $
• Base Construction $
• Construction Contingency- 10% $
• Project Management & Inspection $
• Lease of 405 D Street for NWPY $
• General City-Wide CIP Overhead S
Total Improvements $
In the event of a termination by Lessor, Lessee's sole remedy from Lessor for any such
termination shall be Lessor's reimbursement to Lessee of the unamortized value of the Lessee's
actual out of pocket costs in completing the Tenant Improvements and the costs of leasing 405 D
Street for the NWPY as of the date of termination, amortized on a straight line basis over a
twenty-five year period from the Effective Date. Towards this end, within 60 days of completion
of the Tenant Improvements, Lessee shall provide Lessor with a statement of the actual out of
pocket costs of the Tenant Improvements made to the Premises (Exhibit Q. Such actual out of
pocket costs shall serve as the basis for the calculation of any reimbursement due to Lessee upon
such termination or condemnation.
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DocuSign Envelope ID:5CFD8B2A-543E-427A-965A-CE33BA83269F
LEASE SUMMARY
I. PREMISES: certain real property located in the City of Petaluma, County of Sonoma,
State of California ("Premises") consisting of an approximately 71,874 SF
parcel of land, APN# 007-131-004 together with the improvements
thereon consisting of three buildings: the 2,540 SF Petaluma Passenger
Depot Building, the 520 SF Petaluma Baggage Shed and the 4,760 SF
Petaluma Freight Shed, as depicted on Exhibit A, that is attached to this
Lease and incorporated into it by this reference. Milepost: 5-38.5.
Address: 200 Lakeville Street, Petaluma, CA. (APN # 007-131-004)
2. LESSOR: Northwestern Pacific Railroad Authority, a public agency ("NWPRA")
3. LESSEE: The Petaluma Community Development Commission
4. EFFECTIVE DATE: August 1, 2003
5. RENT: $12,000/year -- payment remains constant over initial term and
subsequent three terms.
G. TERM: 10 YEARS, subject to early termination as provided herein
7. OPTION TO RENEW: Three Five-Year Terms
S. SECURITY DEPOSIT: None
9. TENANT IMPROVEMENTS: Lessee to construct alterations at its sole cost and expense,
as necessary to rehabilitate and renovate the Premises for occupancy,
including seismic retrofit, in accordance with the Secretary of Interior's
Guidelines for Historic Buildings and applicable local building codes.
This Summary is provided for convenience only, and is qualified by the specific terms and
conditions of the Lease that shall control any conflict between this Summary and the terms of the
Lease.
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