HECTOR DE LA ROSA, ASSISTANT CITY MANAGER

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1 CITY COUNCIL REPORT 7E DATE: NOVEMBER 7, 2017 TO: FROM: SUBJECT: MAYOR AND COUNCILMEMBERS HECTOR DE LA ROSA, ASSISTANT CITY MANAGER APPROVE A SECOND AMENDMENT TO THE RECIPROCAL EASEMENT AGREEMENT AND DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS RUNNING WITH THE LAND FOR CERTAIN PROPERTIES KNOWN AS PINOLE GATEWAY EAST RECOMMENDATION It is recommended that the City Council approve a resolution approving a Second Amendment to the Reciprocal Easement Agreement and Declaration of Covenants, Conditions and Restrictions Running with the Land for certain properties known as Pinole Gateway East. BACKGROUND Prior to 2005, the Redevelopment Agency acquired various properties along Pinole Valley Road between I-80 and Henry Avenue known as the Pinole Gateway Project thereby significantly increasing the opportunities for economic development in the area. On November 15, 2005, the Redevelopment Agency approved Resolution No approving the execution of an agreement for purchase and sale of certain properties (Parcel A) to Kaiser Foundation Health and authorizing the execution of a Reciprocal Easement Agreement (REA) for the entire site. Recording of an REA ensured that the site would be developed in accordance with the Redevelopment Plan, imposed reciprocal access to benefit the other parcels on the site, required parking and drainage easement with adjacent land owners which included the Redevelopment Agency. The Original REA encompassed three parcels and envisioned a fourth parcel that would be annexed into the REA and be bound by the terms of the agreement. These parcels were as follows: Parcel A - Kaiser (APNs , and ), Parcel B Henry and Pinole Valley Road (APN ), Parcel C (APN ), and Parcel D former Caltrans property (APN: ).

2 City Council Report Meeting Date: November 7, On April 21, 2015 the City Council approved a Lease and Purchase Option Agreement, and Development Agreement with Thomas Gateway LLC for the development of the Parcels C and D. The approval of the agreements necessitated Compliance with Conditions of Approval, Condition #39 Amendment to a Reciprocal Access Agreement Gateway East, which requires Thomas Gateway LLC to ensure that any Kaiser Permanente parking spaces lost as a result of the common area reconfiguration are replaced. On December 15, 2015, the City Council approved an Amendment to the REA (First Amendment). The key factors of the amendment to the REA included: adding Parcel D as an additional property covered by the REA, required language to address the temporary and permanent replacement of the loss of twelve (12) parking spaces on the Kaiser site due to the development of Parcel C - Starbucks, and among other items to provide an amended site plan that is consistent with the newly proposed Project. REVIEW AND ANALYSIS At this time a Second Amendment to the REA is needed. Below are some of the highlighted proposed amendments to the Original and Amended REA which have been agreed to by all parties. The majority of the changes revolve around the underground parking for the Medical facility on Parcel D. D. Section 3 Definition of Parcel: Defines the Parcels as parcels A, B, C and Section 4 Amends Section 1.3 of Amended REA: Expands the definition of Buildings or Building Improvements to include the underground parking on Parcel D and above ground structures. Section 5 Amends Section 1.4 of Amended REA: Expands the definition of Building Area to include the underground parking on Parcel D. Section 6 Amends Section 1.5 of Amended REA: Clarifies that the 5 area around a Building also includes the area immediately around an above underground portion. Section 8 Amends Section 1.7 of Amended REA: Excludes the underground parking on Parcel D as a Common Area Expense. Section 11 Amends Section (a)(b)(c) of Amended REA: Clarifies the number of phased, temporary and permanent parking space replacement units from Parcel A to be located on Parcel D due to the construction of the medical facility. Adds new Sections D & E which speaks to the number of parking spaces included in the Temporary Easement Area (12) and Permanent Easement Area (15) and the requirement to assure proper signage of the spaces dedicated for Kaiser employees.

3 City Council Report Meeting Date: November 7, Section 13 Amends Section of Amended REA: Excludes the underground parking on Parcel D as a Common Area Expense when slurry sealing. Section 14 Amends Section 3.2 Architectural and Landscape Approvals: strikes out reference to prior design review and conditional use permits and replaces them with the revised design review and conditional use permits approved by the Planning Commission for the Medical Facility. The negotiating parties (City, Kaiser, and Thomas Gateway) have agreed to the amendments to the Amended REA, hereunto attached, and therefore is being presented to the Council for consideration and approval. A copy of the final second amendment was sent to Mr. Lee, purchaser of Parcel B, for his records. Staff is recommending approval of the Second Amendment to the REA and authorizing the City Manager to make minor changes to the Second Amendment, as may be necessary, to carry out the intent of the Amendment. Once the Amended REA is formally executed by all parties, the Amendment will be recorded on each property within the Gateway East site. FISCAL IMPACT There is no cost to the City. Staff and the City Attorney reviewed the document following negotiated changes by Thomas Gateway and Kaiser. ATTACHMENTS: Attachment A: Attachment B: Attachment C: Attachment D: Resolution Second Amendment to REA Amendment to REA Original REA

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5 ATTACHMENT A RESOLUTION NO APPROVING A SECOND AMENDMENT TO THE RECIPROCAL EASEMENT AGREEMENT AND DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS RUNNING WITH THE LAND FOR CERTAIN PROPERTY KNOWN AS PINOLE GATEWAY EAST WHEREAS, on November 15, 2005, the former Redevelopment Agency of the City of Pinole (the Former Agency ) approved Resolution No approving, among other things, the execution of a Reciprocal Easement Agreement (the REA ) for property located on the east side of Pinole Valley Road between the I-80 Freeway and Henry St.; and WHEREAS, the REA was recorded as document number on December 15, 2005; and WHEREAS, the original REA encompassed the following parcels: Parcel A (APNs , and ), Parcel B (APN ) and Parcel C (APN ); and WHEREAS, in 2005 Parcel A was sold to Kaiser for the construction of a medical office building; and WHEREAS, after the original REA was recorded the Former Agency purchased the property now known as Parcel D the Caltrans property (APN: ), to be annexed into the REA at some future date and be bound by the terms of the Agreement; and WHEREAS, on April 21, 2015, the City approved a Lease Agreement, Purchase and Sale Agreement and Development Agreement with Thomas Gateway LLC (the Developer ) for the development of Parcels C and D (the Project ); and WHEREAS, on December 15, 2015 the City Council approved an Amended REA with Kaiser and the Developer in order to add Parcel D to the REA, to provide an amended site plan that was consistent with the property development, and to ensure that Kaiser s parking rights were not reduced from the original REA due to the Development; and WHEREAS, the Developer, Thomas Gateway, is constructing a Medical Facility on Parcel D with underground parking resulting in the elimination of above ground parking spaces currently located on Parcel A - Kaiser; and WHEREAS, Thomas Gateway and Kaiser have proposed amendments to the original and amended REA (the Second Amendment ) to relocate lost parking spaces from Parcel A onto Parcel D, specifically in the underground and above ground site; and

6 Resolution Page 2 of 2 WHEREAS, Kaiser, Thomas Gateway, and City staff, have reviewed and agreed to the terms in the Second Amendment ; and WHEREAS, staff is recommending approval of the Second Amendment by the City Council substantially in the form on file with the City Clerk. NOW, THEREFORE, the City Council of the City of Pinole does hereby: Section 1. Approve the Second Amendment to the Gateway East REA. Section 2. Authorize the City Manager or her designee to execute the Second Amendment and to make such changes as may be necessary to carry out the intent of the Second Amendment, with approval by, and in consultation with, the City Attorney, and to take all actions and execute such other documents as may be necessary to carry out the obligations of the City under the Second Amendment and the intent of this resolution. PASSED AND ADOPTED by the City Council of the City of Pinole on the 7th day of November, 2017 by the following vote: AYES: NOES: ABSENT: ABSTAIN: COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: I, hereby certify that the foregoing resolution was regularly introduced, passed, and adopted on this 7 th day of November Rosa G. Acosta City Clerk

7 ATTACHMENT B RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: City of Pinole 2131 Pear Street Pinole, CA Attn: City Manager Exempt from Recording Fees Pursuant to Government Code Sections 6103 and APNs: , (Space Above This Line Reserved for Recorder s Use Only) , , SECOND AMENDMENT TO RECIPROCAL EASEMENT AGREEMENT AND DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS RUNNING WITH THE LAND (Pinole Gateway East) THIS SECOND AMENDMENT TO RECIPROCAL EASEMENT AGREEMENT AND DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS RUNNING WITH THE LAND (this Second Amendment ), amending that certain Reciprocal Easement Agreement and Declaration of Covenants, Conditions and Restrictions Running with the Land (Pinole Gateway East) dated December 14, 2005 and recorded as Document No in the Official Records of Contra Costa County (the Original REA as amended by that certain First Amendment to Reciprocal Easement Agreement and Declaration of Covenants, Conditions and Restrictions Running with the Land (Pinole Gateway East), dated March 2, 2016 and recorded March 8, 2016 as Document No in the Official Records of Contra Costa County (the First Amendment and, together with the Original REA, the Amended REA, and together with this Second Amendment, the REA ), is made as of 2017, by and among the City of Pinole, a municipal corporation ( Declarant ), as successor in interest to the Successor Agency to the Redevelopment Agency of the City Of Pinole (the Successor Agency ), Kaiser Foundation Health Plan, Inc., a California nonprofit public benefit corporation ( Kaiser ) and Thomas Gateway, LLC, a California limited liability company ( Developer ). Capitalized terms used without definition herein have the meaning ascribed to such terms in the Amended REA. RECITALS A. The Amended REA encumbered four (4) parcels of real property located on the east side of Pinole Valley Road between Interstate 80 and Henry Avenue in Pinole, California and consisting of approximately 6.82 acres, as more particularly described on Exhibit A to the First Amendment and referred to as Parcel A (current APNs , and ), Parcel B (current APN ), Parcel C (current APN ), and Parcel D (current APN ) (collectively, the Amended Parcels or Amended Pinole Gateway East Property ), as shown the Site Plan attached to the First Amendment as Exhibit B (the First Amendment Site Plan.) B. Currently, Declarant holds fee title to, and is the Owner of Parcel B, Kaiser holds fee title to, and is the Owner of Parcel A, and Developer holds fee title to, and is the Owner of Parcels C and D. C. The State of California continues to be the owner of the contiguous Caltrans Land ( Parcel E ), as shown on Exhibit C attached to the First Amendment and Exhibit C-1 attached hereto. Declarant, Kaiser and Developer desire to continue to provide the option to add Parcel E to the property covered by the Amended REA in the future. OAK # v5 1

8 D. The Parcel C and Parcel D development contemplated by the Amended REA and First Amendment Site Plan ( Original Thomas Development ), including construction of Common Area improvements on Parcel A, would have resulted in a loss of parking on Parcel A. Therefore, the Amended REA required Developer to ensure that any parking spaces lost on Parcel A as a result of the Thomas Development were replaced (the Parking Replacement Requirement ). Additionally, the Thomas Development contemplated a potentially extended period between completion of Parcel C construction and commencement of Parcel D construction. For these reasons, the Amended REA required Developer, among other things: (i) to construct two (2) replacement parking spaces located entirely on Parcel A and one (1) replacement parking space located partially on Parcel A and partially on Parcel C (together, the New A/C Parking Spaces ), (ii) to provide Kaiser with the Kaiser Temporary Parking Improvements (including temporary parking lot) during construction of the Thomas Development and the Kaiser Permanent Parking Improvements upon completion of the entire Thomas Development, (iii) to provide Kaiser with the Temporary Parking Easement Benefiting Kaiser with respect to the Kaiser Temporary Parking Improvements and Permanent Parking Easement Benefiting Kaiser with respect to the Kaiser Permanent Parking Improvements, and (iv) upon completion of the Kaiser Temporary Parking Improvements obtain Kaiser s acceptance thereof and the Kaiser Temporary Parking Confirmation, and upon completion of the Kaiser Permanent Parking Improvements obtain Kaiser s acceptance thereof and the Kaiser Permanent Parking Confirmation. E. At this time, Developer has substantially completed the Parcel C development contemplated by the Original Thomas Development, including the New A/C Parking Spaces and all Kaiser Temporary Parking Improvements, and Kaiser has accepted the New A/C Parking Spaces and the Kaiser Temporary Parking Improvements. F. In lieu of the specific development of Parcel D development contemplated by the Original Thomas Development, Developer proposes certain revisions as set forth on the amended site plan attached hereto as Exhibit B-1 (the Second Amendment Site Plan ) which would, among other things: (i) include a larger building on Parcel D; (ii) result in a different loss of parking on Parcel A and construction of different Common Area improvements on Parcel A, generally as depicted on Exhibit F-1 attached hereto, and (iii) require construction of a two-floor underground parking garage on Parcel D, generally as depicted in Exhibit G attached hereto (the Revised Thomas Development ). Developer now also contemplates a much shorter time between development of Parcel C and D than the time contemplated under the Original Thomas Development. Therefore, in connection with Parcel D development included within the Revised Thomas Development, Developer now desires (in addition to providing for Kaiser s continuing use of the New A/C Parking Spaces): (w) to provide Kaiser with an easement for permanent parking spaces in the underground parking garage to be located on Parcel D; (x) to rebuild three of the parking spaces demolished as part of the initial Parcel C development; (y) to eliminate the requirement that Kaiser provide the Kaiser Temporary Parking Confirmation regarding the New A/C Parking Spaces and Kaiser Temporary Parking Improvements, and to provide only for Kaiser acceptance and the Kaiser Permanent Parking Confirmation regarding the Kaiser Permanent Parking Improvements; and (z) to additionally amend the Amended REA to confirm (I) the parking garage to be located on Parcel D is not part of Common Area, (II) the Owner of Parcel D is responsible for all construction and maintenance expenses relating to the parking garage, and (III) the amount of underground parking garage space is not to be taken into account in determining the square footage of any Parcel or the Pro-Rata Share of any Owner. G. Developer has completed construction of the pylon sign to be located on the portion of Parcel D adjacent to the highway off-ramp, and the parties desire to clarify portions of the Amended REA relating thereto. NOW THEREFORE, Declarant, Kaiser and Developer hereby declare that the Amended REA is hereby amended as follows: Section 1. Recitals; Exhibits. The above recitals are true and the recitals, and defined terms set forth therein, are incorporated into this Second Amendment by this reference. All of the Exhibits attached to this Second Amendment are incorporated into and made a part of this Second Amendment. OAK # v5 2

9 Section 2. Definition of Pinole Gateway East Property. The term Pinole Gateway East Property is amended to mean the Amended Pinole Gateway East Property. Section 3. Definition of Parcel. The term Parcel means any parcel depicted on the Second Amendment Site Plan, including Parcel A, Parcel B, Parcel C and Parcel D, and any two or more of such parcels are referred to collectively as the Parcels. Section 4. Definition of Building Envelope. Section 1.3 of the Amended REA is hereby deleted and replaced with the following (double underline is addition, strikethrough is deletion): 1.3 Building(s) or Building Improvements means structures located within Building Areas, including underground parking areas on Parcel D or any other Parcel, and sidewalks contiguous to the above-ground structures constructed within Building Areas. Section 5. Definition of Building Areas. Section 1.4 of the Amended REA is hereby deleted and replaced with the following (double underline is addition, strikethrough is deletion): 1.4 Building Areas means those portions of the Parcels on which structures may be located, as depicted on the Site Plan, and on which underground parking areas may be constructed on Parcel D or any other Parcel. Building Areas may be changed by Declarant as provided in Section 3.6. Section 6. Definition of Building Envelope. Section 1.5 of the Amended REA is hereby deleted and replaced with the following (double underline is addition, strikethrough is deletion): 1.5 Building Envelope means the five foot (5 ) area that is immediately around an above-ground portion of a Building Area, including the sidewalk area surrounding an above-ground portion of a Building Area if such sidewalk exceeds such five foot (5 ) area. Section 7. Definition of Common Area. Section 1.6 of the Amended REA is hereby deleted and replaced with the following (double underline is addition, strikethrough is deletion): 1.6 Common Area means all areas of the Parcels other than Building Areas, Building Envelopes (other than sidewalks contiguous to the structures constructed within Building Areas, which sidewalks shall constitute Common Area) and the pylon sign to be located on the portion of Parcel D adjacent to the highway off-ramp. Notwithstanding the foregoing, above-ground sidewalks contiguous to the structures constructed within Building Areas constitute Common Area. Declarant has the right to revise the configuration of the Common Area as permitted in Section 3.6. Section 8. Definition of Common Area Expenses. Section 1.7 of the Amended REA is hereby deleted and replaced with the following (double underline is addition, strikethrough is deletion): 1.7 Common Area Expenses means the total cost and expense incurred to Maintain the Common Area and Common Area Improvements as provided in this Declaration, including, without limitation, (i) the costs and expenses reasonably incurred to perform the activities identified in Section 2.3.1, (ii) the costs and expenses (including reasonable attorneys fees and costs) of enforcing the terms of this Declaration against Declarant, any Owner and/or the Maintenance Director, (iii) the costs and expenses (including reasonable attorneys fees and costs) of enforcing the rights of Declarant, Owners, and/or the Maintenance Director under this Declaration as against third parties, (iv) the costs and expenses (including reasonable attorneys fees and costs) of defending any actions brought against the Maintenance Director in connection with the performance of its duties as the Maintenance Director (except to the extent such actions relate to the OAK # v5 3

10 gross negligence or willful misconduct of the Maintenance Director), (v) all Unanticipated Costs, as defined in Section , (vi) any supervision fee owing to the Maintenance Director in connection with supervising the construction of capital improvements to the Common Area Improvements, including, without limitation, pursuant to Section , and (vii) subject to the terms and provisions of Section 4.2.4, the costs of procuring and maintaining the insurance described in Sections and Common Area Expenses shall not include (a) the cost to construct, install, replace, repair or re-locate any Utility Facilities; such costs shall be borne by the applicable Owners; (b) except as otherwise provided in Section 2.1.4(e), the cost to construct, install, replace, repair, maintain, or re-locate any underground parking facilities on Parcel D shall be borne by the Owner of Parcel D; (c) the District Landscaping Expenses (as defined in Section 2.3.4), but if such District Landscaping Expenses are not applicable (i.e., because the Landscape Maintenance District (as hereinafter defined) is not formed or does not Maintain the Landscape Medians (as hereinafter defined)), then all the provisions of this Declaration concerning the property constituting the Landscape Medians, including, without limitation, the provisions of this Section 1.7 including as a Common Area Expense the total cost and expense incurred to Maintain the Landscape Medians as a Common Area Improvement, shall continue in full force and effect,; and (cd) all costs and expenses incurred in connection with the operation of the Maintenance Director s business, as opposed to the Maintenance of the Common Areas including, without limitation, Maintenance Director s office rent, employee and other personnel costs, office and utility costs, taxes, and accounting and legal costs. Section 9. Second Amendment Site Plan. Exhibit B to the Amended REA is hereby deleted and replaced with Exhibit B-1 attached hereto (i.e., the Second Amendment Site Plan), which shall be the Site Plan for all purposes of the REA. Section 10. Square Footage. A new Section 1.20A is hereby added to the Amended REA as follows: 1.20A All references in this Declaration to "square footage" of any Parcel shall mean and refer only to surface square footage. Without limiting the foregoing, under no circumstances shall underground parking areas on Parcel D be taken into account in any determination of Parcel square footage. Section 11. Amendment to Grant of Parking Easements. Section of the Amended REA is hereby deleted and replaced with the following (double underline is addition, strikethrough is deletion): Parking Easements for the Benefit of Parcel A. (a) Phased Development of Replacement Parking. DeclarantDeveloper anticipates that the Thomas Development (as modified by the Revised Thomas Development) will be undertaken in phases with development of Parcel C proceeding prior to development of Parcel D. The reconfiguration of the Common Area and modification of Common Area Improvements required for the initial phase Parcel C development, including construction of the Kaiser Temporary Parking Improvements (defined below) on Parcel D, are anticipated to result in the demolition of twelve (12) parking spaces on Parcel A depicted on Exhibit E as the (D)K spaces; provided, that the six (6) contiguous (D)K spaces located on the northerly side of the access road separating them from the other (D)K spaces will not be demolished until after completion of the twelve (12) parking spaces in the Kaiser Exclusive Temporary Easement Area (as defined below). The reconfiguration of the Common Area and modification of Common Area Improvements required for the development of Parcel D pursuant to the entirety of the Revised Thomas Development, including construction of the Kaiser Permanent Parking Improvements (as defined below) on and underneath Parcel D, are anticipated to result in the demolition of nine (9) twenty-one (21) parking spaces on Parcel A (in addition to which include the 12 spaces already to be demolished as part of the initial phase Parcel C development) depicted on Exhibit FExhibit F-1 as the (D)K spaces which, after the reconstruction of three (3) Parcel A spaces demolished as part of the initial phase Parcel C development as provided in Section 2.1.4(f) below, will result in the permanent demolition of eighteen (18) parking OAK # v5 4

11 spaces on Parcel A. As required by the conditions of approval for the Revised Thomas Development, Developer or Declarant, as applicable and as set forth in this Section below, will cause the replacement of all demolished Parcel A parking spaces to ensure there is no net loss of parking spaces available to Kaiser as a result of development of the initial phase Parcel C improvements or the development of Parcel D pursuant to the Revised Thomas Development in its entirety. (b) Temporary Parking Easement. To implement the requirements of subsection (a) above, Declarant or Developer, as applicable, in connection with the initial phase Parcel C development will construct or cause the construction of (i) two (2) replacement parking spaces located entirely on Parcel A and one (1) replacement parking space located partially on Parcel A and partially on Parcel C, depicted on Exhibit E as the (N)K spaces (together the New A/C Parking Spaces ), and (ii) twelve (12) temporary replacement parking spaces located on Parcel D as shown on Exhibit E (the Kaiser Exclusive Temporary Easement Area ). To memorialize Kaiser s exclusive parking rights with respect to the Kaiser Exclusive Temporary Easement Area, DeclarantDeveloper, as grantor and the Owner of Parcel D, subject to recordation of the Kaiser Temporary Parking Confirmation, hereby grants to Kaiser, as grantee in its capacity as the Owner of Parcel A, the exclusive temporary easement ( Temporary Parking Easement Benefiting Kaiser ) and right to use the Kaiser Exclusive Temporary Easement Area, subject to Declarant or Developer s right to limit access to the Temporary Parking Easement Benefiting Kaiser for limited time periods during construction of pylon sign footings (estimated time (1) week) and a pylon sign (estimated time (3) weeks). Promptly following completion of the demolition of existing Common Area Improvements on Parcel A required to conform to the First Amendment Site Plan, Developer or Declarant, as applicable, shall commence, and thereafter diligently prosecute to completion (estimated time sixty (60) days), construction of the Kaiser Temporary Parking Improvements (defined below) in accordance with the City of Pinole Building Department standards for commercial parking lots and underground commercial parking garages, as applicable (the Applicable Standards ). In the event Declarant or Developer, as applicable (the Initial Obligated Party ), ceases or fails to diligently construct the New A/C Parking Spaces and Kaiser Temporary Parking Improvements, Kaiser shall have the right, by written notice to the Initial Obligated PartyDeveloper, at the expense of the Initial Obligated PartyDeveloper, to construct the Kaiser Temporary Parking Improvements. If the Initial Obligated PartyDeveloper shall fail to reimburse Kaiser for all such costs within ten (10) business days after demand therefor, the Initial Obligated PartyDeveloper shall also pay interest at the rate of the lesser of ten percent (10%) and the maximum rate allowed by law. Consistent with the Thomas Development Conditions of Approval (the COA ), Declarant agrees that no certificate of occupancy shall be issued for the building(s) to be constructed by Developer on Parcel C unless and until the New A/C Parking Spaces and Kaiser Temporary Parking Improvements are substantially complete. The Temporary Parking Easement Benefiting Kaiser and the Kaiser Exclusive Temporary Easement Area improvements shall remain in effect until each of the following conditions have been satisfied: (i) Declarant or Developer, as applicable, has commenced the work of developing Parcel D; (ii) Declarant or Developer has provided Kaiser with a construction phasing plan as provided in subsection (c) below; and (iii) subject to recordation of the Kaiser Permanent Parking Confirmation (as defined below), Declarant or Developer, as applicable, has granted to Kaiser, as grantee in its capacity as the Owner of Parcel A, the exclusive permanent easement ( Permanent Parking Easement Benefiting Kaiser ) and right to use fifteen (15) parking spaces to be located on the Lower Level 1 Garage or Lower Level 2 Garage areas to be constructed on Parcel D as shown on Exhibit FExhibit G located on Parcel D (the Kaiser Exclusive Permanent Easement Area ), as the same may be modified, reconfigured or relocated from time to time in accordance with the terms of this Declaration (but in all cases with the prior written consent of the Owner of Parcel A). Declarant and Developer acknowledge and agree that the number of parking spaces included within the Kaiser Exclusive Temporary Easement Area (i.e. 12 spaces) and the Kaiser Exclusive Permanent Easement Area (i.e. 15 spaces), together with the parking spaces to reconstructed on Parcel A as provided above, are intended to implement a 1-for-1 replacement of the Parcel A parking spaces that are anticipated to be demolished in connection with the Thomas Development. In the event the as-built condition of the Thomas Development improvements results in elimination of more Parcel A parking spaces than the numbers set forth above, Declarant and Developer agree that the dimensions of the Kaiser Exclusive Temporary Easement Area and/or Kaiser Exclusive Permanent Easement Area, as applicable, and the number of parking spaces within such area or allocated to the Kaiser Exclusive Permanent Easement, OAK # v5 5

12 shall be increased as necessary to ensure a 1-for-1 replacement of all Parcel A parking spaces demolished in connection with the Thomas Development. (c) Permanent Parking Easement. At least sixty (60) days prior to commencing development of Parcel D or any demolition of the Kaiser Temporary Parking Improvements, Declarant or Developer, as applicable, shall submit to Kaiser, as Owner of Parcel A, a construction phasing plan for such work, together with an amendment of easement instrument terminating the Temporary Parking Easement Benefiting Kaiser (as long as such termination provides for the valid automatic reinstatement contemplated in this Section 2.1.4(c) below) and, subject to recordation of the Kaiser Permanent Parking Confirmation, granting to Kaiser, as grantee in its capacity as the Owner of Parcel A, the Permanent Parking Easement Benefiting Kaiser. The amendment of easement instrument shall be in a form reasonably acceptable to Kaiser and Declarant or Developer, as applicable. Kaiser shall execute and acknowledge and deliver the amendment of easement instrument to Declarant or Developer, as applicable, for recordation in the Official Records at such time as the development of Parcel D is ready to commence. Promptly following recordation of the amendment of easement instrument, Declarant or Developer, as applicable, shall commence construction of, and thereafter diligently proceed to complete, the Kaiser Permanent Parking Improvements so as to minimize the period of time between demolition of the Kaiser Temporary Parking Improvements and substantial completion of the Kaiser Permanent Parking Improvements and, in all events, Declarant or Developer, as applicable, shall ensure that any interruption in replacement parking use does not exceed nine (9)six (6) months in duration; provided however that if Declarant or Developer experiences unanticipated delays in constructing the Parcel D improvements, as reasonably determined by DeclarantDeveloper in its discretion, the 6-month period may be extended by up to three (3) additional months, provided Developer or Declarant, as applicable, is diligently and continuously prosecuting such construction to completion. Declarant agrees that no certificate of occupancy shall be issued for the building(s) to be constructed by Developer on Parcel D unless and until the Kaiser Permanent Parking Improvements are substantially complete. In the event the interruption in use of replacement parking does exceed six (6) months (or such longer period not to exceed nine (9) months in total), and if the Owner of Parcel A is experiencing interference with its operations on Parcel A due to a shortfall in available parking and Developer is not implementing reasonable procedures to minimize as required by Section 3.6 (including without limitation, establishing other temporary parking and/or valet parking, as applicable), Kaiser shall have the right, by written notice to Declarant or Developer, as applicable (the Obligated Party ), at the expense of the Obligated PartyDeveloper, to reconstruct the Kaiser Temporary Parking Improvements in substantially the same location as existing immediately prior to demolition of such spaces and to automatically reinstate the Temporary Parking Easement Benefiting Kaiser which shall then remain in place until such time as the Kaiser Permanent Parking Improvements are substantially complete. If the Obligated PartyDeveloper shall fail to reimburse Kaiser for all such costs within ten (10) business days after demand therefor, the Obligated PartyDeveloper shall also pay interest at the rate of the lesser of ten percent (10%) and the maximum rate allowed by law, and in no event shall the Obligated PartyDeveloper or any successor-in-interest thereto have the right to remove the reconstructed Kaiser Temporary Parking Improvements from use unless and until all sums due to Kaiser, including, but not limited to, interest, have been paid in full and Kaiser has received reasonable assurance that the constructing party will be capable of completing the construction of the Kaiser Permanent Parking Improvements. (d) Developer acknowledges and agrees that the number of parking spaces included within the Kaiser Exclusive Temporary Easement Area (i.e. 12 spaces) and the Kaiser Exclusive Permanent Easement Area (i.e. 15 spaces), together with New A/C Parking Spaces and Reconstructed Parking Spaces (as defined below in 2.1.4(g)(ii)), as applicable, are intended to implement a 1-for-1 replacement of the Parcel A parking spaces that are anticipated to be demolished in connection with the Thomas Development or Revised Thomas Development. In the event the as-built condition of the Thomas Development or Revised Thomas Development improvements results in elimination of more Parcel A parking spaces than the numbers set forth above, Developer agrees that the dimensions of the Kaiser Exclusive Temporary Easement Area and/or Kaiser Exclusive Permanent Easement Area, as applicable, and the number of parking spaces within such area or allocated to the Kaiser Exclusive Permanent Easement, shall be increased as necessary to ensure a 1-for-1 replacement of all Parcel A OAK # v5 6

13 parking spaces demolished in connection with the Thomas Development or Revised Thomas Development. (e) Designation of Specific Permanent Kaiser Parking Spaces. Upon written request by Kaiser, as Owner of Parcel A, the Owner of Parcel D shall specifically designate fifteen (15) (or greater number, if required by Section 2.1.4(d) above) mutually agreed parking spaces within the Kaiser Exclusive Permanent Easement Area for use only by Permitted Users of Parcel A. The Owner of Parcel D shall mark the designated parking spaces by installing signs, painting on parking spaces or implementing other means not otherwise inconsistent with the terms of this Declaration, and the Owner of Parcel A shall be responsible for all costs and expenses and Maintenance in connection with such signage and painting. (f) Modification of the Permanent Parking Improvements. In the event Declarant or Developer desires to make any modification to the location, number of spaces or dimensions of such spaces or any other material modification to the Kaiser Permanent Parking Improvements from that shown on Exhibit FExhibit G, or designated in accordance with Section 2.1.4(e) above, Declarant or Developer shall submit such proposed modifications to Kaiser, as Owner of Parcel A, for review and approval not to be unreasonably withheld, conditioned or delayed. Within sixty (60) calendar days following submittal of the modified parking plans to Kaiser, Kaiser will either approve or disapprove such plans. This procedure shall be repeated until the modified plans for the Kaiser Permanent Parking Improvements are approved by Kaiser; provided, however, that following the initial submittal Kaiser shall endeavor in good faith to review and approve or disapprove such modified plans within twelve (12) business days following submittal thereof. Approval of modified plans for the Kaiser Permanent Parking Improvements are not a representation by Kaiser that such plans are in compliance with the requirements of governing authorities, and it shall be the responsibility of Declarant, Developer or the then Owner of Parcel D, as applicable, to meet and comply with the Applicable Standards and all applicable laws in connection with such development. No changes to any approved modified Kaiser Permanent Parking Improvements plans shall be made without the written consent of Kaiser, which consent shall not be unreasonably delayed, conditioned or withheld. Promptly following Kaiser s approval of any modified plans, Kaiser shall execute, acknowledge and deliver to Declarant or Developer, as applicable, for recordation in the Official Records, an amendment of easement instrument replacing the diagram attached hereto as Exhibit FExhibit G with a new diagram showing the modified Kaiser Permanent Parking Improvements plans as approved by Kaiser. (e)(g) Condition to Effectiveness of the Parking Easements. (i) As a condition to the effectiveness of the grant of the Temporary Parking Easement Benefitting Kaiser, Declarant or Developer shall construct the parking improvements depicted on Exhibit E attached hereto (such improvements located in the Kaiser Exclusive Temporary Easement Area, (the Kaiser Temporary Parking Improvements ) to the reasonable satisfaction of Kaiser in accordance with those certain plans by AMS, Project SE, submitted under cover sheet dated January 29, 2015, including Sheets C-4.1 and C-5.1 revised as requested by Kaiser and approved by the Declarant, and in accordance with the Applicable Standards and all applicable laws and the terms of the Declaration. Upon substantial completion of the Kaiser Temporary Parking Improvements, Declarant or Developer shall provide written notice to Kaiser, after which Kaiser and Declarant or Developer shall inspect the Kaiser Temporary Parking Improvements and Declarant or Developer shall remedy any deficiencies. Upon Kaiser s acceptance of the Kaiser Temporary Parking Improvements, Kaiser shall execute and acknowledge a confirmation of acceptance of the Kaiser Temporary Parking (the Kaiser Temporary Parking Confirmation ), and Developer or Declarant shall record the same, at which point the Temporary Parking Easement Benefiting Kaiser shall be effective. (ii) As a condition to the effectiveness of the grant of the Permanent Parking Easement Benefitting Kaiser, Declarant or Developer shall (x) reconstruct the three (3) Parcel A (D)K spaces at the entrance to the Kaiser Exclusive Temporary Easement Area to be demolished as part of the initial phase Parcel C development (see Exhibit E to the First OAK # v5 7

14 Amendment) (the Reconstructed Parking Spaces ), and (y) construct the parking improvements depicted on the underground parking areas (Lower Level 1 Garage and Lower Level 2 Garage) on Parcel D as depicted on Exhibit G Exhibit Fattached hereto located in the Kaiser Exclusive Permanent Easement Area (the Kaiser Permanent Parking Improvements ) to the reasonable satisfaction of Kaiser in accordance with those certain plans by, submitted under cover sheet dated, including Sheets as approved by the Declarant plans approved by Kaiser, as Owner of Parcel A, as provided in subsection (c) above and in accordance with the Applicable Standards and all applicable laws and the terms of the Declaration. Upon substantial completion of the Reconstructed Parking Spaces and Kaiser Permanent Parking Improvements, Declarant or Developer shall provide written notice to Kaiser, after which Kaiser and Declarant or Developer shall inspect the Reconstructed Parking Spaces and Kaiser Permanent Parking Improvements and Declarant or Developer shall remedy any deficiencies. Upon Kaiser s acceptance of the Reconstructed Parking Spaces and Kaiser Permanent Parking Improvements, Kaiser shall execute and acknowledge a confirmation of acceptance of the Kaiser Permanent Parking Improvements (the Kaiser Permanent Parking Confirmation ), and Developer or Declarant shall record the same, at which point the Permanent Parking Easement Benefiting Kaiser shall be effective. (f)(h) Restriction Relating to Commencement of Construction on Parcel A. Prior to commencement of any construction on Parcel A in connection with the Thomas Development or Revised Thomas Development, Declarant or Developer shall enter into a temporary access agreement (the Temporary Access Agreement ) that is satisfactory to Kaiser to address, among other things, insurance, indemnity, approval of plans, a requirement to issue a notice to proceed prior to commencing any work of demolition and other matters as reasonably determined by Kaiser. In no event shall any party commence construction or demolition activities on Parcel A unless and until a Temporary Access Agreement is executed and delivered by the Owner of Parcel A and the party desiring to conduct such construction or demolition activities on Parcel A. Section 12. Parking. Section of the Amended REA is hereby deleted and replaced with the following (double underline is addition, strikethrough is deletion): Parking. Each Owner shall comply with the parking ratios as established by Declarant with respect to the Pinole Gateway East Property; provided, that, except as otherwise expressly provided in this Section below with respect to Parcel A, no Owner shall be permitted to provide on its respective Parcel less than the number of parking spaces required pursuant to applicable laws, codes, rules and regulations. The parking ratio requirements for Parcel A may be satisfied by including the parking spaces located on Parcel A as well as the Kaiser Temporary Parking Improvements or Kaiser Permanent Parking Improvements, as applicable, located on Parcel D, and the Parcel C portion of the New A/C Parking Spaces. In no event shall the parking spaces within the Kaiser Temporary Parking Improvements or Kaiser Permanent Parking Improvements count towards the parking requirements for Parcel D. Except as otherwise expressly provided in Section with respect to the Temporary Parking Easement Benefiting Kaiser and the Permanent Parking Easement Benefiting Kaiser (and this Section 2.2.3), each Owner has the right to restrict parking to only the Permitted Users of each such Owner s respective Parcels (including, without limitation, within each such Owner's respective Parcels, by installing signs, painting on parking spaces or implementing other means not otherwise inconsistent with the terms of this Declaration; provided, that, notwithstanding anything to the contrary contained in this Declaration, each such Owner shall be responsible for all costs and expenses and Maintenance in connection with such signage and painting), and nothing contained in this Declaration shall be interpreted as creating a reciprocal parking easement between or among any combination of Owners or such Owners Permitted Users. Consistent with the terms of Section 2.1.4, Kaiser, as Owner of Parcel A, shall have the right to restrict parking within the Temporary Parking Easement Benefiting Kaiser (and, upon termination of the Temporary Parking Easement OAK # v5 8

15 Benefitting Kaiser, the Permanent Parking Easement Benefiting Kaiser), and to the Parcel C portion of the New A/C Parking Spaces, to only the Permitted Users of the Owner of Parcel A by installing signs, painting on parking spaces or implementing other means not otherwise inconsistent with the terms of this Declaration, and Kaiser, as Owner of Parcel A,; shall be responsible for all costs and expenses and Maintenance in connection with such signage and painting. Notwithstanding any other provision hereof to the contrary, the Pro Rata Shares of the respective Owners shall be calculated without reference to Kaiser s exclusive right to use the Kaiser Exclusive Temporary Easement Area and, upon termination of the Temporary Parking Easement Benefitting Kaiser, the Kaiser Exclusive Permanent Easement Area, and to use the Parcel C portion of the New A/C Parking Spaces. No changes in the number of parking spaces within any Parcel, or in the configuration of the Common Area from that shown on the Site Plan shall be made without the prior written consent of the Owner of the applicable Parcel and the Approving Party, and approval of the Approving Party shall not to be unreasonably withheld, conditioned or delayed. Any proposed change to the Common Area must be made in compliance with all applicable laws, codes, rules and regulations. Notwithstanding the foregoing, Declarant shall have the right to modify the Site Plan as provided in Section 3.6. Section 13. Slurry Sealing. Section of the Amended REA shall not apply to the underground parking area located on Parcel D. Section 14. Architectural and Landscaping Approvals. Section 3.2 of the Amended REA is hereby deleted and replaced with the following (double underline is addition, strikethrough is deletion): 3.2 Architectural and Landscaping Approvals. The exterior design, elevations, materials, finishes, colors, signage and lighting of all proposed improvements located in the Building Areas ( Exterior Elements ) and all other improvements proposed to be constructed by an Owner on its Parcel shall be constructed, altered, remodeled, painted and replaced in accordance with all applicable laws, any signage guidelines that may be promulgated by the Approving Party and pursuant to plans and specifications reviewed and approved in writing by the Approving Party. The review of the Approving Party shall be solely to ensure that such Exterior Elements and other improvements are reasonably compatible ( Compatible ) with the design, elevations, finishes and colors of the improvements located on each of the other Parcels. The Approving Party shall not have the right of approval with respect to any element of a Building that is structural in nature or that relates to the interior of the Building. The Approving Party may prescribe the type and intensity of exterior Building and Common Area lighting used by each Owner in order to ensure uniformity and harmony of the lighting schemes for the Parcels and to comply with the requirements of Declarant. Notwithstanding anything to the contrary contained in this Declaration, the Approving Party s approval shall be deemed given with respect to those portions of any plans and specifications consistent with the terms, conditions and requirements of (i) that certain Pinole Gateway East Project Final Environmental Impact Report dated December 2004, (ii) that certain City of Pinole Design Review Staff Report Memorandum from Elizabeth Dunn, AICP, City Planner, to the Design Review Board, dated October 14, 2004, with the subject heading of Item for October 14, 2004 Regular Meeting, (iii) that certain City of Pinole Planning Commission Staff Report Design Review and Conditional Use Permit for the Pinole Gateway East Project, dated December 13, 2004, and referenced as Agenda Item F-3, (iv) that certain City of Pinole Mitigated Negative Declaration and Mitigation Monitoring and Reporting Program for the Revised Thomas Development dated January 2015, including erratum pages and the City Council staff report dated April 21, 2015 and City Council staff report dated March 21, 2017 and City Council Resolution No approving a Mitigated Negative Declaration Addendum in conjunction with Design Review and Conditional Use Permits and 17-02, and (v) those certain City of Pinole City Council Design Review (DR 14-11) and Conditional Use (CUP 14-05, 14-06, and 14-08) Permits and the OAK # v5 9

16 Tentative Parcel Map (TPM ) and Development Agreement (DA 14-01) for the Revised Thomas Development; (vi) as to the portion of the Revised Thomas Development located on Parcel C, those certain City of Pinole City Council Design Review (DR 14-11) and Conditional Use (CUP 14-05, 14-06, and 14-08) Permits; and (vii) as to the portion of the Revised Thomas Development located on Parcel D, those certain City of Pinole City Council Design Review (DR 16-29) and Conditional Use Permits (CUP and 17-02) Permits. All plans and specifications submitted for approval to the Approving Party shall be approved or disapproved in writing within sixty (60) days and any objection shall be made with specificity. The failure to approve or disapprove in writing any request for approval within such period shall be deemed an approval. Approval shall not be unreasonably withheld, and shall be given if such proposed improvements are Compatible. Plans and specifications shall be professionally prepared by licensed architects and/or engineers, as applicable. All paint and sign colors shall be submitted with professional samples. The Approving Party s review of the plans and specifications as provided in this Section 3.2 shall be solely for the purpose of ensuring that the improvements contemplated therein are Compatible. The Approving Party s review and approval of such plans and specifications shall not be interpreted to be an assurance that such plans and specifications and the improvements constructed therefrom are or would be structurally sound, free of defects or in compliance with applicable laws, codes, rules and regulations. The Approving Party shall have no liability to the submitting Owner or to any other party based on its review and approval of such plans and specifications. No Owner shall commence any construction, alteration, remodeling or other change to Exterior Elements or to other improvements located on its Parcel, the cost of which would reasonably be expected to exceed Fifty Thousand Dollars ($50,000.00), without first obtaining the approval set forth in this Section 3.2 ( Design Approval ). If an Owner should commence such work without first obtaining Design Approval, then the Approving Party or any Owner shall be entitled to seek equitable relief (including, without limitation, temporary restraining orders or preliminary injunctions) against the breaching Owner, it being agreed by all Owners that there is no adequate remedy available at law for such a breach. Section 15. Locations. Section 3.6 of the Amended REA is hereby amended by deleting the last sentence of the first paragraph and replacing it with the following: Except as otherwise provided in Section above, tthere must be sufficient Common Area on a Parcel to provide parking in the ratios required by Section Section 16. Additional Property. Exhibit C to the Amended REA (Parcel Map Depicting Parcel E) is hereby deleted and replaced with Exhibit C-1 (Parcel Map Depicting Parcel E) attached hereto. Section 17. Severability. If any term of this Second Amendment is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the provisions shall continue in full force and effect unless the rights and obligations of the Declarant or any Owner are materially altered or abridged by such invalidation, voiding or unenforceability. Section 18. No Modification or Waiver. Except as otherwise expressly set forth herein, all other terms and conditions of the Amended REA remain unchanged and in full force and effect. Section 19. Counterparts. This Second Amendment may be executed in any number of counterparts, each of which will, for all purposes, be deemed to be an original, and all of which are identical. OAK # v5 10

17 IN WITNESS WHEREOF, Declarant, Kaiser and Developer have duly executed this Second Amendment on the dates set forth below. CITY OF PINOLE, a municipal corporation KAISER FOUNDATION HEALTH PLAN, INC., a California nonprofit public benefit corporation By: Michelle M. Fitzer, City Manager By: Its: Date: Date: THOMAS GATEWAY, LLC, a California limited liability company By: Its: Steven P. Thomas Manager By: Its: Samuel B. Thomas Date: SIGNATURES MUST BE NOTARIZED OAK # v5 11

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19 ACKNOWLEDGMENTS A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA ) COUNTY OF ) On, 20 before me,, Notary Public, personally appeared Steven P. Thomas, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature: (seal) ****************************** A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA ) COUNTY OF ) On, 20 before me,, Notary Public, personally appeared Samuel B. Thomas, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature: (seal) OAK # v5 Acknowledgment

20 ACKNOWLEDGMENTS A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA ) COUNTY OF ) On, 20 before me,, Notary Public, personally appeared, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature: (seal) ****************************** A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA ) COUNTY OF ) On, 20 before me,, Notary Public, personally appeared, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature: (seal) OAK # v5 Acknowledgment

21 SECOND AMENDMENT SITE PLAN OAK # v5 Exhibit B-1

22 PARCEL MAP DEPICTING PARCEL E OAK # v5 Exhibit C-1

23 ADDITIONAL PARCEL A PARKING SPACES TO BE DEMOLISHED FOR PARCEL D DEVELOPMENT OAK # v5 Exhibit F-1

24 PARCEL D LOWER LEVEL GARAGE PARKING AREAS (KAISER EXCLUSIVE PERMANENT EASEMENT AREA) OAK # v5 Exhibit G

25 ATTACHMENT C RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: The City of Pinole 2131 Pear Street Pinole, CA Attn: City Manager Exempt from Recording Fees Pursuant to Government Code Sections 6103 and APNs: , (Space Above This Line Reserved for Recorder s Use Only) , , FIRST AMENDMENT TO RECIPROCAL EASEMENT AGREEMENT AND DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS RUNNING WITH THE LAND (Pinole Gateway East) THIS FIRST AMENDMENT TO RECIPROCAL EASEMENT AGREEMENT AND DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS RUNNING WITH THE LAND (this Amendment ), amending that certain Reciprocal Easement Agreement and Declaration of Covenants, Conditions and Restrictions Running with the Land (Pinole Gateway East) dated December 14, 2005 and recorded as Document No in the Official Records of Contra Costa County (the Original REA, and together with this Amendment, the REA ), is made as of December, 2015 by and between the City of Pinole, a municipal corporation ( Declarant ), as successor in interest to the Successor Agency to the Redevelopment Agency of the City Of Pinole (the Successor Agency ) and Kaiser Foundation Health Plan, Inc., a California nonprofit public benefit corporation ( Kaiser ). Capitalized terms used without definition herein have the meaning ascribed to such terms in the Original REA. RECITALS A. The Redevelopment Agency of the City of Pinole, a public body corporate and politic (the "Former Agency") was the declarant under the Original REA. B. In 2011, the California Legislature adopted, the Governor signed, and the California Supreme Court, in California Redevelopment Association, et al. v. Matosantos, (2012) 53 Cal.4 th 231, upheld Assembly Bill x1 26 ( ABx1 26 ). C. Pursuant to ABx1 26 (as amended by AB 1484 and SB 107, the Dissolution Law ), all California redevelopment agencies were dissolved effective February 1, 2012, including the Former Agency, which was replaced by the Successor Agency. D. Under the Dissolution Law, the Successor Agency prepared a Long Range Property Management Plan (as defined in the Dissolution Law). E. Pursuant to the Long Range Property Management Plan, certain properties owned by the Former Agency were transferred to the Declarant, including a portion of the property encumbered by the Original REA and this Amendment. OAK # v20 1

26 F. The Original REA encumbered three (3) parcels of real property located on the east side of Pinole Valley Road between Interstate 80 and Henry Avenue in Pinole, California and consisting of approximately six and one-quarter (6-1/4) acres, as more particularly described on Exhibit A to the Original REA and referred to as Parcel A (current APNs , and ), Parcel B (current APN ) and Parcel C (current APN ) (collectively, the Original Parcels or Original Pinole Gateway East Property ), as shown the Site Plan attached to the Original REA as Exhibit B (the Original Site Plan ). G. Currently, Declarant holds fee title to, and is the Owner (as defined in the Original REA) of Parcel B and Parcel C, and Kaiser, holds fee title to, and is the Owner of Parcel A. H. Declarant is the owner of the contiguous Caltrans Land (APN ) ( Parcel D ) and, together with the Original Pinole Gateway East Property, the Pinole Gateway East Property, as more particularly described in Exhibit A attached hereto. I. Declarant desires to amend the Original REA to include Parcel D as an additional property covered by the REA, as contemplated in Section 9.21 of the Original REA. J. Parcel A, Parcel B, and Parcel C are also shown on the Site Plan attached hereto as Exhibit B (the Amended Site Plan ). K. The State of California is the owner of the contiguous Caltrans Land ( Parcel E ), as shown on Exhibit C attached hereto. Declarant desires to provide the option to add Parcel E to the property covered by the REA in the future. L. As required under the Dissolution Law, the Oversight Board (as defined in the Dissolution Law) has approved a long-range property management plan for the sale or transfer of all real property owned by Declarant, pursuant to which the Successor Agency has transferred Parcels B, C and D to Declarant for future development. M. Declarant and Thomas Gateway, LLC, a California limited liability company ( Developer ), have entered into a lease and purchase option agreement approved by the Declarant s City Council on April 21, 2015 and dated June 15, 2015 setting forth certain parameters for the ground lease and development of Parcels C and D (the Thomas Development ). The Thomas Development is subject to, among other things, all Conditions of Approval accompanying the City of Pinole City Council Resolutions , , and (the Thomas Conditions of Approval ). N. The proposed Thomas Development results in a loss of parking on the Parcel A and contemplates construction of certain Common Area improvements on Parcel A, and for this reason prior to the issuance of a building permit for the Thomas Development, Developer must submit to the satisfaction of the City Engineer, an offer to record a lot line adjustment or other agreement to ensure that any parking spaces lost on Parcel A as a result of the Common Area reconfiguration are replaced (the Parking Replacement Requirement ). O. In order to address the Parking Replacement Requirement, subject to Developer s construction of the Kaiser Replacement Parking, Declarant will grant to Kaiser the temporary and perpetual parking easements referenced below, and the Original Site Plan will be replaced with the Amended Site Plan, to reflect the proposed Thomas Development. NOW THEREFORE, Declarant and Kaiser hereby declare that the Original REA is hereby amended as follows: Section 1. Recitals; Exhibits. The above recitals are true and the recitals, and defined terms set forth therein, are incorporated into this Amendment by this reference. All of the Exhibits attached to this Amendment are incorporated into and made a part of this Amendment. OAK # v20 2

27 Section 2. Definition of Parcel. Subject to the recordation of the Kaiser Confirmation (defined below), the term Parcel means any parcel depicted on the Amended Site Plan, including Parcel A, Parcel B, Parcel C and Parcel D, and any two or more of such parcels are referred to collectively as the Parcels. Section 3. Definition of Common Area Expenses. Section 1.7 of the Original REA is hereby deleted in its entirety and replaced with the following: 1.7 Common Area Expenses, means the total cost and expense incurred to Maintain the Common Area and Common Area Improvements as provided in this Declaration, including, without limitation, (i) the costs and expenses reasonably incurred to perform the activities identified in Section 2.3.1, (ii) the costs and expenses (including reasonable attorneys fees and costs) of enforcing the terms of this Declaration against Declarant, any Owner and/or the Maintenance Director, (iii) the costs and expenses (including reasonable attorneys fees and costs) of enforcing the rights of Declarant, Owners, and/or the Maintenance Director under this Declaration as against third parties, (iv) the costs and expenses (including reasonable attorneys fees and costs) of defending any actions brought against the Maintenance Director in connection with the performance of its duties as the Maintenance Director (except to the extent such actions relate to the gross negligence or willful misconduct of the Maintenance Director), (v) all Unanticipated Costs, as defined in Section , (vi) any supervision fee owing to the Maintenance Director in connection with supervising the construction of capital improvements to the Common Area Improvements, including, without limitation, pursuant to Section , and (vii) subject to the terms and provisions of Section 4.2.4, the costs of procuring and maintaining the insurance described in Section and Common Area Expenses shall not include (a) the cost to construct, install replace, repair or re-locate any Utility Facilities; such costs shall be borne by the applicable Owners; (b) the District Landscaping Expenses (as defined in Section 2.3.4), but if such District Landscaping Expenses are not applicable (i.e. because the Landscape Maintenance District (as hereinafter defined) is not formed or does not Maintain the Landscape Medians (as hereinafter defined)), then all the provisions of this Declaration concerning the property constituting the Landscape Medians, including, without limitation, the provisions of this Section 1.7 including as a Common Area Expense the total cost and expense incurred to Maintain the Landscape Medians as a Common Area Improvement, shall continue in full force and effect, and (c) all costs and expenses incurred in connection with the operation of the Maintenance Director s business, as opposed to the Maintenance of the Common Areas including, without limitation, Maintenance Director s office rent, employee and other personnel costs, office and utility costs, taxes, and accounting and legal costs. Section 4. Definition of Pro Rata Share. Subject to the recordation of the Kaiser Confirmation, Section 1.16 of the Original REA is hereby deleted and replaced with the following: 1.16 Pro Rata Share means the percentage that the square footage of any Owner's Parcel bears to the total square footage of Parcel A, B, C and D (totaling 297,179 square feet), which shall conclusively be deemed to be as follows: Parcel Square Footage Pro Rata Share A 227, % B 26, % C 18, % D 24, % 297, % OAK # v20 3

28 Notwithstanding the foregoing, upon recordation of any lot line adjustment(s) or upon the addition of Parcel E or any applicable portion thereof, then Declarant s land surveyor shall re-determine each Owner s Pro Rata Share, to be effective as of the recordation of the new Parcel Map or lot line adjustment(s), subject to the reasonable prior written approval of the Owners. Section 5. Amended Site Plan. Subject to the recordation of the Kaiser Confirmation, Exhibit B to the Original REA is hereby deleted and replaced with Exhibit B attached hereto (i.e., the Amended Site Plan). Section 6. Amended Pinole Gateway West Property Diagram. Exhibit D to the Original REA is hereby deleted and replaced with Exhibit D attached hereto. Section 7. as follows: Grant of Parking Easements. A new Section is hereby added to the Original REA Parking Easements for the Benefit of Parcel A. (a) Phased Development of Replacement Parking. Declarant anticipates that the Thomas Development will be undertaken in phases with development of Parcel C proceeding prior to development of Parcel D. The reconfiguration of the Common Area and modification of Common Area Improvements required for the initial phase Parcel C development, including construction of the Kaiser Temporary Parking Improvements (defined below) on Parcel D, are anticipated to result in the demolition of twelve (12) parking spaces on Parcel A depicted on Exhibit E as the (D)K spaces; provided, that the six (6) contiguous (D)K spaces located on the northerly side of the access road separating them from the other (D)K spaces will not be demolished until after completion of the twelve (12) parking spaces in the Kaiser Exclusive Temporary Easement Area (as defined below). The reconfiguration of the Common Area and modification of Common Area Improvements required for the entirety of the Thomas Development, including construction of the Kaiser Permanent Parking Improvements (defined below) on Parcel D, are anticipated to result in the demolition of twenty-one (21) parking spaces on Parcel A (which include the 12 spaces to be demolished as part of the initial phase Parcel C development) depicted on Exhibit F as the (D)K spaces. As required by the conditions of approval for the Thomas Development, Developer or Declarant, as applicable and as set forth in this Section below, will cause the replacement of all demolished Parcel A parking spaces to ensure there is no net loss of parking spaces available to Kaiser as a result of development of the initial phase Parcel C improvements or the Thomas Development in its entirety. (b) Temporary Parking Easement. To implement the requirements of subsection (a) above, Declarant or Developer, as applicable, in connection with the initial phase Parcel C development will construct or cause the construction of (i) two (2) replacement parking spaces located entirely on Parcel A and one (1) replacement parking space located partially on Parcel A and partially on Parcel C, depicted on Exhibit E as the (N)K spaces, and (ii) twelve (12) temporary replacement parking spaces located on Parcel D as shown on Exhibit E (the Kaiser Exclusive Temporary Easement Area ). To memorialize Kaiser s exclusive parking rights with respect to the Kaiser Exclusive Temporary Easement Area, Declarant, as grantor and the Owner of Parcel D, subject to recordation of the Kaiser Temporary Parking Confirmation, hereby grants to Kaiser, as grantee in its capacity as the Owner of Parcel A, the exclusive temporary easement ( Temporary Parking Easement Benefiting Kaiser ) and right to use the Kaiser Exclusive Temporary Easement Area, subject to Declarant or Developer s right to limit access to the Temporary Parking Easement Benefiting Kaiser for limited time periods during construction of pylon sign footings (estimated time (1) week) and a pylon sign (estimated time (3) weeks). Promptly following completion of the demolition of existing Common Area Improvements on Parcel A required to conform to the Amended Site Plan, Declarant or Developer, as applicable, shall commence, and thereafter diligently prosecute to completion (estimated time sixty (60) days), construction of the Kaiser Temporary Parking Improvements (defined below) in accordance with the City of Pinole Building Department standards for OAK # v20 4

29 commercial parking lots (the Applicable Standards ). In the event Declarant or Developer, as applicable (the Initial Obligated Party ), ceases or fails to diligently construct the Kaiser Temporary Parking Improvements, Kaiser shall have the right, by written notice to the Initial Obligated Party, at the expense of the Initial Obligated Party, to construct the Kaiser Temporary Parking Improvements. If the Initial Obligated Party shall fail to reimburse Kaiser for all such costs within ten (10) business days after demand therefor, the Initial Obligated Party shall also pay interest at the rate of the lesser of ten percent (10%) and the maximum rate allowed by law. Consistent with the Thomas Development Conditions of Approval (the COA ), Declarant agrees that no certificate of occupancy shall be issued for the building(s) to be constructed by Developer on Parcel C unless and until the Kaiser Temporary Parking Improvements are substantially complete. The Temporary Parking Easement Benefiting Kaiser and the Kaiser Exclusive Temporary Easement Area improvements shall remain in effect until each of the following conditions have been satisfied: (i) Declarant or Developer, as applicable, has commenced the work of developing Parcel D; (ii) Declarant or Developer has provided Kaiser with a construction phasing plan as provided in subsection (c) below; and (iii) subject to recordation of the Kaiser Permanent Parking Confirmation, Declarant or Developer, as applicable, has granted to Kaiser, as grantee in its capacity as the Owner of Parcel A, the exclusive permanent easement ( Permanent Parking Easement Benefiting Kaiser ) and right to use fifteen (15) parking spaces as shown on Exhibit F located on Parcel D (the Kaiser Exclusive Permanent Easement Area ), as the same may be modified, reconfigured or relocated from time to time in accordance with the terms of this Declaration (but in all cases with the prior written consent of the Owner of Parcel A). Declarant and Developer acknowledge and agree that the number of parking spaces included within the Kaiser Exclusive Temporary Easement Area (i.e. 12 spaces) and the Kaiser Exclusive Permanent Easement Area (i.e. 15 spaces), together with the parking spaces to be reconstructed on Parcel A as provided above, are intended to implement a 1-for-1 replacement of the Parcel A parking spaces that are anticipated to be demolished in connection with the Thomas Development. In the event the as-built condition of the Thomas Development improvements results in elimination of more Parcel A parking spaces than the numbers set forth above, Declarant and Developer agree that the dimensions of the Kaiser Exclusive Temporary Easement Area and/or Kaiser Exclusive Permanent Easement Area, as applicable, and the number of parking spaces within such area(s), shall be increased as necessary to ensure a 1-for-1 replacement of all Parcel A parking spaces demolished in connection with the Thomas Development. (c) Permanent Parking Easement. At least sixty (60) days prior to commencing development of Parcel D or any demolition of the Kaiser Temporary Parking Improvements, Declarant or Developer, as applicable, shall submit to Kaiser, as Owner of Parcel A, a construction phasing plan for such work, together with an amendment of easement instrument terminating the Temporary Parking Easement Benefiting Kaiser (as long as such termination provides for the valid automatic reinstatement contemplated in this Section 2.1.4(c) below) and, subject to recordation of the Kaiser Permanent Parking Confirmation, granting to Kaiser, as grantee in its capacity as the Owner of Parcel A, the Permanent Parking Easement Benefiting Kaiser. The amendment of easement instrument shall be in a form reasonably acceptable to Kaiser and Declarant or Developer, as applicable. Kaiser shall execute and acknowledge and deliver the amendment of easement instrument to Declarant or Developer, as applicable, for recordation in the Official Records at such time as the development of Parcel D is ready to commence. Promptly following recordation of the amendment of easement instrument, Declarant or Developer, as applicable, shall commence construction of, and thereafter diligently proceed to complete, the Kaiser Permanent Parking Improvements so as to minimize the period of time between demolition of the Kaiser Temporary Parking Improvements and substantial completion of the Kaiser Permanent Parking Improvements and, in all events, Declarant or Developer, as applicable, shall ensure that any interruption in replacement parking use does not exceed six (6) months in duration; provided however that if Declarant or Developer experiences unanticipated delays in constructing the Parcel D improvements, as reasonably determined by Declarant in its discretion, the 6-month period may be extended by up to three (3) additional months, provided Developer or Declarant, as applicable, is diligently and continuously prosecuting such construction to completion. Declarant agrees that no certificate of occupancy shall be issued for the building(s) to be constructed by Developer on Parcel D unless and until the Kaiser Permanent Parking Improvements are substantially complete. In the event the interruption in use of replacement parking does exceed six (6) months (or such longer period not to exceed nine (9) months in total), Kaiser shall have the right, by written notice to Declarant or Developer, as applicable (the OAK # v20 5

30 Obligated Party ), at the expense of the Obligated Party, to reconstruct the Kaiser Temporary Parking Improvements in substantially the same location as existing immediately prior to demolition of such spaces and to automatically reinstate the Temporary Parking Easement Benefiting Kaiser which shall then remain in place until such time as the Kaiser Permanent Parking Improvements are substantially complete. If the Obligated Party shall fail to reimburse Kaiser for all such costs within ten (10) business days after demand therefor, the Obligated Party shall also pay interest at the rate of the lesser of ten percent (10%) and the maximum rate allowed by law, and in no event shall the Obligated Party or any successor-in-interest thereto have the right to remove the reconstructed Kaiser Temporary Parking Improvements from use unless and until all sums due to Kaiser, including, but not limited to, interest, have been paid in full and Kaiser has received reasonable assurance that the constructing party will be capable of completing the construction of the Kaiser Permanent Parking Improvements. (d) Modification of the Permanent Parking Improvements. In the event Declarant or Developer desires to make any modification to the location, number of spaces or dimensions of such spaces or any other material modification to the Kaiser Permanent Parking Improvements from that shown on Exhibit F, Declarant or Developer shall submit such proposed modifications to Kaiser, as Owner of Parcel A, for review and approval not to be unreasonably withheld, conditioned or delayed. Within sixty (60) calendar days following submittal of the modified parking plans to Kaiser, Kaiser will either approve or disapprove such plans. This procedure shall be repeated until the modified plans for the Kaiser Permanent Parking Improvements are approved by Kaiser; provided, however, that following the initial submittal Kaiser shall endeavor in good faith to review and approve or disapprove such modified plans within twelve (12) business days following submittal thereof. Approval of modified plans for the Kaiser Permanent Parking Improvements are not a representation by Kaiser that such plans are in compliance with the requirements of governing authorities, and it shall be the responsibility of Declarant, Developer or the then Owner of Parcel D, as applicable, to meet and comply with the Applicable Standards and all applicable laws in connection with such development. No changes to any approved modified Kaiser Permanent Parking Improvements plans shall be made without the written consent of Kaiser, which consent shall not be unreasonably delayed, conditioned or withheld. Promptly following Kaiser s approval of any modified plans, Kaiser shall execute, acknowledge and deliver to Declarant or Developer, as applicable, for recordation in the Official Records, an amendment of easement instrument replacing the diagram attached hereto as Exhibit F with a new diagram showing the modified Kaiser Permanent Parking Improvements plans as approved by Kaiser. (e) Condition to Effectiveness of the Parking Easements. As a condition to the effectiveness of the grant of the Temporary Parking Easement Benefitting Kaiser, Declarant or Developer shall construct the improvements depicted on Exhibit E attached hereto located in the Kaiser Exclusive Temporary Easement Area (the Kaiser Temporary Parking Improvements ) to the reasonable satisfaction of Kaiser in accordance with those certain plans dated December, 2015, and in accordance with the Applicable Standards and all applicable laws and the terms of the Declaration. Upon substantial completion of the Kaiser Temporary Parking Improvements, Declarant or Developer shall provide written notice to Kaiser, after which Kaiser and Declarant or Developer shall inspect the Kaiser Temporary Parking Improvements and Declarant or Developer shall remedy any deficiencies. Upon Kaiser s acceptance of the Kaiser Temporary Parking Improvements, Kaiser shall execute and acknowledge a confirmation of acceptance of the Kaiser Temporary Parking (the Kaiser Temporary Parking Confirmation ), and Developer or Declarant shall record the same, at which point the Temporary Parking Easement Benefiting Kaiser shall be effective. As a condition to the effectiveness of the grant of the Permanent Parking Easement Benefitting Kaiser, Declarant or Developer shall construct the improvements depicted on Exhibit F attached hereto located in the Kaiser Exclusive Permanent Easement Area (the Kaiser Permanent Parking Improvements ) to the reasonable satisfaction of Kaiser in accordance with plans approved by Kaiser, as Owner of Parcel A, as provided in subsection (c) above and in accordance with the Applicable Standards and all applicable laws and the terms of the Declaration. Upon substantial completion of the Kaiser Permanent Parking Improvements, Declarant or Developer shall provide written notice to Kaiser, after which Kaiser and Declarant or Developer shall inspect the Kaiser Permanent Parking Improvements and Declarant or Developer shall remedy any deficiencies. Upon Kaiser s acceptance of the Kaiser Permanent Parking Improvements, Kaiser shall execute and acknowledge a confirmation of acceptance of the Kaiser Permanent Parking (the Kaiser OAK # v20 6

31 Permanent Parking Confirmation ), and Developer or Declarant shall record the same, at which point the Permanent Parking Easement Benefiting Kaiser shall be effective. (f) Restriction Relating to Commencement of Construction on Parcel A. Prior to commencement of any construction on Parcel A in connection with the Thomas Development, Declarant or Developer shall enter into a temporary access agreement (the Temporary Access Agreement ) that is satisfactory to Kaiser to address, among other things, insurance, indemnity, approval of plans, a requirement to issue a notice to proceed prior to commencing any work of demolition and other matters as reasonably determined by Kaiser. In no event shall any party commence construction or demolition activities on Parcel A unless and until a Temporary Access Agreement is executed and delivered by the Owner of Parcel A and the party desiring to conduct such construction or demolition activities on Parcel A. Section 8. Use of Common Area. In Section of the Original REA, the reference to operations of any Owner or its Permitted Users is hereby replaced with operations of any Owner or its Permitted Users or Access as contemplated on the Site Plan. Section 9. Construction of Common Area Improvements. In Section of the Original REA, the words and all other requirements of this Declaration are hereby inserted at the end of the third sentence. Section 10. the following: Slurry Sealing. Section of the Original REA is hereby deleted and replaced with Not less frequently than once every ten (10) years following the initial paving of any Parcel, or more often as required to maintain the parking surface in accordance with the standards set forth in Section above, the Owner of such Parcel (by delegation to the Maintenance Director) shall slurry seal and restripe all parking and loading areas on the Parcel; Section 11. following: Parking. Section of the Original REA is hereby deleted and replaced with the Parking. Each Owner shall comply with the parking ratios as established by Declarant with respect to the Pinole Gateway East Property; provided, that, except as otherwise expressly provided in this Section below with respect to Parcel A, no Owner shall be permitted to provide on its respective Parcel less than the number of parking spaces required pursuant to applicable laws, codes, rules and regulations. The parking ratio requirements for Parcel A may be satisfied by including the parking spaces located on Parcel A as well as the Kaiser Temporary Parking Improvements or Kaiser Permanent Parking Improvements, as applicable, located on Parcel D. In no event shall the parking spaces within the Kaiser Temporary Parking Improvements or Kaiser Permanent Parking Improvements count towards the parking requirements for Parcel D. Except as otherwise expressly provided in Section with respect to the Temporary Parking Easement Benefiting Kaiser and the Permanent Parking Easement Benefiting Kaiser, each Owner has the right to restrict parking to only the Permitted Users of each such Owner s respective Parcels (including, without limitation, within each such Owner's respective Parcels, by installing signs, painting on parking spaces or implementing other means not otherwise inconsistent with the terms of this Declaration; provided, that, notwithstanding anything to the contrary contained in this Declaration, each such Owner shall be responsible for all costs and expenses and Maintenance in connection with such signage and painting), and nothing contained in this Declaration shall be interpreted as creating a reciprocal parking easement between or among any combination of Owners or such Owners' Permitted Users. Consistent with the terms of Section 2.1.4, Kaiser, as Owner of Parcel A, shall have the right to restrict parking within the Temporary Parking Easement Benefiting Kaiser (and, upon termination of the Temporary Parking Easement Benefitting Kaiser, the Permanent Parking Easement Benefiting Kaiser) to only the OAK # v20 7

32 Permitted Users of the Owner of Parcel A by installing signs, painting on parking spaces or implementing other means not otherwise inconsistent with the terms of this Declaration, and Kaiser, as Owner of Parcel A; shall be responsible for all costs and expenses and Maintenance in connection with such signage and painting. Notwithstanding any other provision hereof to the contrary, the Pro Rata Shares of the respective Owners shall be calculated without reference to Kaiser s exclusive right to use the Kaiser Exclusive Temporary Easement Area and, upon termination of the Temporary Parking Easement Benefitting Kaiser, the Kaiser Exclusive Permanent Easement Area. No changes in the number of parking spaces within any Parcel, or in the configuration of the Common Area from that shown on the Site Plan shall be made without the prior written consent of the Owner of the applicable Parcel and the Approving Party, and approval of the Approving Party shall not to be unreasonably withheld, conditioned or delayed. Any proposed change to the Common Area must be made in compliance with all applicable laws, codes, rules and regulations. Notwithstanding the foregoing, Declarant shall have the right to modify the Site Plan as provided in Section 3.6. Section 12. Management and Supervision Fee. Section of the Original REA is hereby deleted and replaced with the following: To compensate the Maintenance Director for its services provided under this Declaration, each Owner shall pay the Maintenance Director an annual management fee ("Management Fee") equal to the lesser of (X) the Owner s Pro Rata Share of ten percent (10%) of the actual Common Area Expenses incurred to Maintain the Common Area and Common Area Improvements, without taking into account either any cost or expense expressly excluded from the definition of Common Area Expenses, or any of the elements set forth in subsections (ii) (certain costs and expenses of enforcing the REA); (iii) (certain costs and expenses of enforcing rights against third parties); (iv) (certain costs and expenses of defending actions against the Maintenance Director); or (vi) (any supervision fee) of the definition of Common Area Expenses; and (Y) Three Thousand Five Hundred Dollars ($3,500.00) per acre of land contained in that Owner's Parcel (or Parcels, if an Owner owns more than one Parcel), or, if such Owner's Parcel or Parcels consists of less than one acre, Three Thousand Five Hundred Dollars ($3,500.00). If clause (Y) is selected, the Management Fee set forth in clause (Y) shall increase on each anniversary of the date of this Declaration by multiplying the then-existing annual dollar amount by one hundred two percent (102%). An Owner shall not be obligated to pay the Management Fee with respect to its Parcel until such time as the Common Area Improvements for such Parcel are Substantially Complete. The Owners shall pay the Management Fee to the Maintenance Director in equal monthly installments on the first day of each month. In addition to this Management Fee, which is designed to compensate the Maintenance Director for its services under this Declaration, the Maintenance Director shall also be entitled to receive a supervision fee ("Supervision Fee") for supervising the construction of capital improvements (other than as related to initial construction of such improvements) or capital renovations of the Common Area and/or Common Area Improvements (e.g., repaving all or substantially all of the parking lot, even if in phases). This Supervision Fee shall be equal to ten percent (10%) of the total hard and soft costs of such capital improvements or capital renovations and shall be paid to the Maintenance Director as such work progresses; provided however, the Supervision Fee shall only be paid to the Maintenance Director in the event that supervision of such work is not contracted out to a third party or performed by the Owner of the particular Parcel. Section 13. Architectural and Landscaping Approvals. Section 3.2 of the Original REA is hereby deleted and replaced with the following: 3.2 Architectural and Landscaping Approvals. The exterior design, elevations, materials, finishes, colors, signage and lighting of all proposed improvements located in OAK # v20 8

33 the Building Areas ( Exterior Elements ) and all other improvements proposed to be constructed by an Owner on its Parcel shall be constructed, altered, remodeled, painted and replaced in accordance with all applicable laws, any signage guidelines that may be promulgated by the Approving Party and pursuant to plans and specifications reviewed and approved in writing by the Approving Party. The review of the Approving Party shall be solely to ensure that such Exterior Elements and other improvements are reasonably compatible ( Compatible ) with the design, elevations, finishes and colors of the improvements located on each of the other Parcels. The Approving Party shall not have the right of approval with respect to any element of a Building that is structural in nature or that relates to the interior of the Building. The Approving Party may prescribe the type and intensity of exterior Building and Common Area lighting used by each Owner in order to ensure uniformity and harmony of the lighting schemes for the Parcels and to comply with the requirements of Declarant. Notwithstanding anything to the contrary contained in this Declaration, the Approving Party s approval shall be deemed given with respect to those portions of any plans and specifications consistent with the terms, conditions and requirements of (i) that certain Pinole Gateway East Project Final Environmental Impact Report dated December 2004, (ii) that certain City of Pinole Design Review Staff Report Memorandum from Elizabeth Dunn, AICP, City Planner, to the Design Review Board, dated October 14, 2004, with the subject heading of Item for October 14, 2004 Regular Meeting, (iii) that certain City of Pinole Planning Commission Staff Report Design Review and Conditional Use Permit for the Pinole Gateway East Project, dated December 13, 2004, and referenced as Agenda Item F-3, (iv) that certain City of Pinole Mitigated Negative Declaration and Mitigation Monitoring and Reporting Program for the Thomas Development dated January 2015, including erratum pages and the City Council staff report dated April 21, 2015, and (v) those certain City of Pinole City Council Design Review (DR 14-11) and Conditional Use (CUP 14-15, 14-06, and 14-08) Permits and the Tentative Parcel Map (TPM ) and Development Agreement (DA 14-01) for the Thomas Development. All plans and specifications submitted for approval to the Approving Party shall be approved or disapproved in writing within sixty (60) days and any objection shall be made with specificity. The failure to approve or disapprove in writing any request for approval within such period shall be deemed an approval. Approval shall not be unreasonably withheld, and shall be given if such proposed improvements are Compatible. Plans and specifications shall be professionally prepared by licensed architects and/or engineers, as applicable. All paint and sign colors shall be submitted with professional samples. The Approving Party s review of the plans and specifications as provided in this Section 3.2 shall be solely for the purpose of ensuring that the improvements contemplated therein are Compatible. The Approving Party s review and approval of such plans and specifications shall not be interpreted to be an assurance that such plans and specifications and the improvements constructed therefrom are or would be structurally sound, free of defects or in compliance with applicable laws, codes, rules and regulations. The Approving Party shall have no liability to the submitting Owner or to any other party based on its review and approval of such plans and specifications. No Owner shall commence any construction, alteration, remodeling or other change to Exterior Elements or to other improvements located on its Parcel, the cost of which would reasonably be expected to exceed Fifty Thousand Dollars ($50,000.00), without first obtaining the approval set forth in this Section 3.2 ( Design Approval ). If an Owner should commence such work without first obtaining Design Approval, then the Approving Party or any Owner shall be entitled to seek equitable relief (including, without limitation, temporary restraining orders or preliminary injunctions) against the breaching Owner, it being agreed by all Owners that there is no adequate remedy available at law for such a breach. OAK # v20 9

34 Section 14. Section 3.4 of the Original REA is hereby amended by adding the following between the fourth (4 th ) and fifth (5 th ) sentences: In addition to any other specific obligations contained in this Declaration, each Owner will notify all other Owners prior to commencement of any construction activities which will impact them or their operations, and not commence construction without holding a coordination meeting to which all affected Owners are invited, to discuss schedule and necessary activities to reasonably minimize disruption. Impacted Owners will also be invited to attend periodic construction meetings to discuss and address any ongoing impacts. Each Owner shall implement, at its cost and expense, reasonable procedures to minimize the interference caused by its own construction activities on activities of other Owners, including without limitation, establishing temporary parking (see e.g. Section 2.1.4(b)) and/or valet parking for required time periods. Section 15. Additional Property. Exhibit C to the Original REA (Alternate Site Plan) is hereby deleted and replaced with Exhibit C (Parcel Map Depicting Parcel E) attached hereto. Section 9.21 of the Original REA is hereby deleted and replaced with the following: 9.21 Additional Property. Any Owner, upon notice to the other Owner(s), shall have the right to add to the property covered by this Declaration all or a portion of that certain property depicted on Exhibit C as Parcel E ( Parcel E ), provided such additional property is contiguous to a Parcel that is already subject to this Declaration and owned by the Owner seeking to add such property. Any addition of all or a portion of Parcel E shall become effective and shall constitute an amendment of this Declaration effective as of the date such Owner records an amendment to this Declaration in the Official Records against all of the Parcels that contains (a) a new legal description containing the legal descriptions of the existing Parcels A, B, C and D and the legal description of Parcel E, or the applicable portion thereof, and (b) an amendment of Section 1.16 (Pro Rata Share) increasing the total square footage of the Pinole Gateway East Property to reflect the added property, reducing the Pro Rata Shares of Parcels A, B, C and D, and setting forth the Pro Rata Share of the added Parcel E, or applicable portion thereof. To memorialize the agreement of the Owners as to the adjusted Pro Rata Shares, the Owner who is adding such property shall obtain the written consent of the other Owner(s) to the amendment prior to recording such amendment. The written consent of the other Owner(s) to the amendment shall not be unreasonably withheld, conditioned or delayed, and shall be given if (i) the added property is contiguous to a Parcel that is already subject to this Declaration and owned by the Owner seeking to add such property, and (ii) the Pro Rata Shares, as proposed to be adjusted, accurately reflect the square footage of the added property. Section 16. Severability. If any term of this Amendment is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the provisions shall continue in full force and effect unless the rights and obligations of the Declarant or any Owner are materially altered or abridged by such invalidation, voiding or unenforceability. Section 17. No Modification or Waiver. Except as otherwise expressly set forth herein, all other terms and conditions of the Original REA remain unchanged and in full force and effect. IN WITNESS WHEREOF, Declarant and Kaiser have duly executed this Amendment on the dates set forth below. OAK # v20 10

35 CITY OF PINOLE, a municipal corporation KAISER FOUNDATION HEALTH PLAN, INC., a California nonprofit public benefit corporation By: Executive Director By: Its: Date: Date: SIGNATURES MUST BE NOTARIZED OAK # v20 11

36 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California ) ) ss County of Contra Costa ) On, before me,, (Name of Notary) notary public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. (Notary Signature) OAK # v20 12

37 Exhibit A PINOLE GATEWAY EAST PROPERTY [to be reviewed and confirmed by title company] REAL PROPERTY IN THE CITY OF PINOLE, COUNTY OF CONTRA COSTA, STATE OF CALIFORNIA, BEING A PORTION OF THE RANCHO EL PINOLE, DESCRIBED AS FOLLOWS: Parcel A Beginning at a point on the Northeast line of that property granted to the State of California by deed recorded in Book 2817, at Page 275, Contra Costa County Records, being the Southwest terminus of that course shown as North 39 12'00" East, feet in said Deed, thence along said Northeast line South 56 26'00" West, feet; thence leaving the last said line Northerly along the arc of a non tangent curve to the right, the radius point of which lies North 71 49'29" East, feet, through a central angle of 06 41'02", an arc length of feet; thence North 78 30'32" East, feet; thence North 56 13'40" East, feet; thence North 04 52'45" West, feet; thence South 85 19'53" West, feet; thence North 03 35'08" West, feet; thence North 41 16'50" West, feet; thence North " West, feet; thence North " East, feet; thence along the arc of a tangent curve to the left, having a radius of feet, through a central angle of 01 41'14", an arc length of feet; thence South 61 12'51" East, feet; thence North 13 45'41" East, feet; thence North 12 30'01" West, feet; thence North 28 45'07" East, feet; thence North 15 23'10" East, feet; thence North 20 44'24" East, feet; thence North 10 51'00" East, feet; thence North 20 45'00" East, feet to the Southerly line of Henry Avenue, feet in width; thence along the last said Southerly line South 69 15'00" East, feet; thence leaving the last said Southerly line South 03 15'00" East, feet; thence South 78 42'37" East, feet; thence South 24 53'00" West, feet; thence South 39 12'00" West, feet to the Point of Beginning, containing 5.23 acres, more or less. APN: Parcel B Commencing at a point on the Southerly line of Henry Avenue, feet in width, being the Northeast corner of Parcel A as shown on that Parcel Map filed in Book 54 of Parcel Maps, at Page 39, Contra Costa County Records, thence along said Southerly line of Henry Avenue North 69 15'00" West, feet; to the Point of Beginning; thence leaving the last said line South 20 45'00" West, feet; thence South 10 51'00" West, feet; thence South " West, feet; thence South 15 23'10" West, feet; thence South 28 45'07" West, feet; thence South 12 30'01" East, feet; thence South 13 45'41" West, feet; thence North 61 12'51" West, feet; thence Northerly along the arc of a non tangent curve to the left, the radius point of which lies North 83 59'54" West, feet, through a central angle of ", an arc length of feet; thence along the arc of a reverse curve to the right, having a radius of feet, through a central angle of 99 43'05", an arc length of feet; thence along the arc of a compound curve to the right, having a radius of feet, through a central angle of 16 42'03", an arc length of feet; thence South 69 15'00" East, feet to the Point of Beginning, containing 0.60 acres, more or less. APN: OAK # v20 Exhibit A-1

38 Parcel C Commencing at a point on the Northeast line of that property granted to the State of California by deed recorded in Book 2817, at Page 275, Contra Costa County Records, being the Southwest terminus of that course shown as North 39 12'00" East, feet in said Deed, thence along said Northeast line South 56 26'00" West, feet; thence leaving the last said line Northerly along the arc of a non tangent curve to the right, the radius point of which lies North 71 49'29" East, feet, through a central angle of 06 41'02", an arc length of feet to the Point of Beginning; thence continuing Northerly along the arc of the last said curve to the right, of which the radius point lies North 78 30'32" East, a radial distance of feet, through a central angle of 19 10'46", an arc distance of feet; thence North 07 41'20" East, 4.98 feet; thence South 81 54'12" East, feet; thence South 41 16'50" East, feet; thence South 03 35'08" East, feet; thence North 85 19'53" East, feet; thence South 04 52'45" East, feet; thence South 56 13'40" West, feet; thence South 78 30'32" West, feet; to the Point of Beginning, containing 0.42 acres, more or less. APN: Parcel D THOSE PORTIONS OF THE GRANT DEED TO THE STATE OF CALIFORNIA WITH STATE DEED NO RECORDED ON AUGUST 1, 1956, IN VOLUME 2817, AT PAGE 275 OFFICIAL RECORDS OF CONTRA COSTA COUNTY, STATE OF CALIFORNIA, MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE WESTERLY TERMINUS OF THE LINE DESCRIBED IN ABOVE-SAID GRANT DEED AS NORTH 56 26' EAST FEET ; THENCE ALONG SAID LINE NORTH 56 26' EAST, FEET; THENCE SOUTH 47 49' 28 EAST, FEET; THENCE SOUTH 42 10' 32 WEST, FEET TO A NON-TANGENT CURVE CONCAVE TO THE NORTHEAST WITH A RADIUS OF FEET FROM WHICH A RADIAL BEARS NORTH 22 42' 27 EAST; THENCE NORTHWESTERLY ALONG THE ARC OF SAID CURVE FEET THROUGH A CENTRAL ANGLE OF 41 13' 33 ; THENCE SOUTH 62 34' 08 WEST, 4.01 FEET TO A NON- TANGENT CURVE CONCAVE TO THE NORTHEAST HAVING A RADIUS OF FEET FROM WHICH A RADIAL BEARS NORTH 62 36' 45 EAST; THENCE NORTHWESTERLY ALONG THE ARC OF SAID CURVE FEET THROUGH A CENTRAL ANGLE OF 03 27' 19 ;THENCE SOUTH 38 44' 45 WEST, FEET; THENCE NORTH 30 03' 40 WEST, FEET TO A NON TANGENT CURVE CONCAVE TO THE NORTHEAST HAVING A RADIUS OF FEET FROM WHICH A RADIAL BEARS NORTH 59 56' 20 EAST; THENCE NORTHWESTERLY ALONG THE ARC OF SAID CURVE FEET THROUGH A CENTRAL ANGLE OF 06 33' 20, MORE OR LESS TO THE POINT OF BEGINNING. APN: OAK # v20 Exhibit A-2

39 Exhibit B AMENDED SITE PLAN OAK # v20 Exhibit B

40 Exhibit C PARCEL MAP DEPICTING PARCEL E OAK # v20 Exhibit C

41 Exhibit D PINOLE GATEWAY WEST PROPERTY OAK # v20 Exhibit D

42 Exhibit E KAISER EXCLUSIVE TEMPORARY EASEMENT AREA OAK # v20 Exhibit E

43 Exhibit F KAISER EXCLUSIVE PERMANENT EASEMENT AREA OAK # v20 Exhibit F

44 Page intentionally left blank

45 Docume~t~ -Provided by Data Tree LLC vi;it's proprietary imaging and delivery system Copyright 2003, All rights reserved ATTACHMENT D ~?) RECORDING REQUESTED BY AND WHEN RECORDED RETURN TO: ~llllffiu llilliiiiih CONTRA COSTA Co Recorder Office STEPHEN L. WEIRL-Clerk Recorder DOC- 200~ Acct 6- First American Title Th d DEC :00:00 : The Redevelopment Agency of the City ofpmo MI~r-s ~r 00 MOD '$43.00 REC $ Pear Street ref $ Pinole, California Attention: Executive Director N / Of~31-S F Ttl Pd $ Nbr MNH/R2/1-4l (! s - ~ RECIPROCAL EASEMENT AGREEMENT AND DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS RUNNING WITH THE LAND (Pinole Gateway East) THIS RECIPROCAL EASEMENT AGREEMENT AND DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS RUNNING WITH THE LAND (this "Declaration") is made as of December 14, 2005 by THE REDEVELOPMENT AGENCY OF THE CITY OF PINOLE, a public body corporate and politic ("Declarant"). RECITALS A Declarant owns certain real property located on the east side of Pinole Valley Road between Interstate 80 and Henry Avenue in Pinole, California and consisting of approximately six and one-quarter (6~) acres, as more particularly described on Exhibit A attached hereto (the "Pinole Gateway East Property"). Declarant intends to subdivide the Pinole Gateway East Property into several parcels as depicted on the site plan attached hereto as Exhibit B or in such other configurations as Declarant shall desire. Any parcel depicted on the Site Plan (as hereinafter defined), as the same may be amended or modified by Declarant, or hereafter created from any further subdivision of any such parcels, shall be referred to as a "Parcel" and any two or more of such parcels shall be referred to collectively as "Parcels". B. Declarant intends to hold, sell, ground lease and/or lease the Parcels to separate owners, lessees and/or ground lessees. C. Declarant intends by this Declaration to impose reciprocal access and drainage easements with respect to the Parcels and to impose on the Parcels mutually beneficial restrictions under a general plan of improvement for the benefit of Declarant and the Owners (as hereinafter defined) of the Parcels.. DECLARATION NOW, THEREFORE, in consideration of the mutual promises contained in this Declaration and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Declarant declares that the Parcels shall be owned, sold, leased, managed, operated, mortgaged, encumbered, rented, developed, improved, conveyed, graded, landscaped, maintained, repaired, occupied and used subject to the uniform covenants, conditions, restrictions, easements, #

46 - Documents provided by Data Tree LLC ~ia it'_s_ proprietary i~-aqing and delivery system Copyright 2003, All rights reserved rights, rights-of-way, liens, charges and other protective and beneficial provisions set forth in this Declaration, each and all of which (i) are hereby expressly imposed on and against each Parcel as mutual, beneficial and equitable servitudes in favor of and for the mutual use and benefit of the other Parcels, Declarant and all subsequent Owners of the Parcels or any part thereof, (ii) are hereby expressly declared to be binding upon the Parcels, Declarant and on all subsequent Owners of the Parcels or any part thereof, and (iii) shall run with the land and each and every part thereof, inuring to the benefit of and being a burden upon the Parcels and shall bind the respective Owners of the Parcels. Following recordation of this Declaration, any conveyance, transfer, sale, hypothecation, encumbrance, assignment, lease or sublease of all or any portion of any Parcel made by an Owner shall be and hereby is deemed to incorporate by reference the provisions of this Declaration, as the same m~y from time to time be amended. The covenants contained in this Declaration shall be covenants running with the land pursuant to applicable law, including, but not limited to, Section 1468 ofthe California Civil Code. In consideration of the foregoing, Declarant declares as follows: ARTICLE 1 DEFINITIONS 1.1 "Access" means and is deemed to include and permit the following: (a) The pedestrian and vehicular traffic of the Owners and their respective successors, assigns, heirs, grantees, mortgagees, tenants, subtenants, licensees, invitees, patients, patrons, and concessionaires, and the officers, directors, agents, employees, customers, visitors, licensees and invitees of any of them, as well as to the public (hereinafter collectively called "Permitted Users"), over any and all portions of the Common Area (as hereinafter defined) designated for such purpose (the foregoing shall exclude the servicing of vehicles in the Common Area); (b) The ingress and egress of any Permitted Users over the Common Area and their vehicles over any portion of the Common Area and to and from public streets adjacent to the Common Area; (c) The movement of pedestrian Permitted Users between business establislunents and occupants located or to be located within the Building Areas (as hereinafter defined); and (d) The ingress and egress over the Common Area of delivery and service trucks and vehicles to and from Building Areas or any portion thereof and the public streets adjacent to the Parcels for the delivery of goods, wares or merchandise and the rendition of services to the Owners and their respective Permitted Users. 1.2 "Approving Party" means the Maintenance Director, or, if there is no Maintenance Director, then Declarant, so long as Declarant owns a fee interest in any Parcel, and if there is no Maintenance Director and Declarant no longer owns a fee interest in any Parcel, then the Owners, based on the prior written approval of the Owner(s) of a majority of the total #

47 Oocum~nts provided by-dat;tree lie via it's proprietary imaging and delivery system Copyright 2003, All rights reserved square footage of all of the Parcels (the Owner(s) who are seeking the consent or approval are entitled to vote on the matter that involves their Parcel). 1.3 "Building(s)" or "Building Improvements" means structures located within Building Areas, including sidewalks contiguous to the structures constructed within Building Areas. 1.4 "Building Areas" means those portions of the Parcels on which structures may be located, as depicted on the Site Plan. Building Areas may be changed by Declarant as provided in Section "Building Envelope" means the five foot (5 ') area that is immediately around a Building Area, including the sidewalk area surrounding a Building Area if such sidewalk exceeds such five foot (5') area. 1.6 "Common Area" means all areas of the Parcels other than Building Areas, Building Envelopes (other than sidewalks contiguous to the structures constructed within Building Areas, which sidewalks shall constitute Common Area). Declarant has the right to revise the configuration of the Common Area as permitted in Section 3.6. I. 7 "Common Area Expenses" means the total cost and expense incurred to Maintain the Common Area and Common Area Improvements as provided in this Declaration, including, without limitation, (i) the costs and expenses reasonably incurred to perform the activities identified in Section 2.3.1, (ii) the costs and expenses (including reasonable attorneys' fees and costs) of enforcing the terms of this Declaration against Declarant, any Owner and/or the Maintenance Director, (iii) the costs and expenses (including reasonable attorneys' fees and costs) of enforcing the rights of Declarant, Owners and/or the Maintenance Director under this Declaration as against third parties, (iv) the costs and expenses (including reasonable attorneys' fees and costs) of defending any actions brought against the Maintenance Director in connection with the performance of its duties as the Maintenance Director (except to the extent such actions relate to the gross negligence or willful misconduct of the Maintenance Director), (v) all Unanticipated Costs, as defined in Section , (vi) any supervision fee owing to the Maintenance Director in connection with supervising the construction of capital improvements to the Common Area Improvements, including, without limitation, pursuant to Section , and (vii) subject to the terms and provisions of Section 4.2.4, the costs of procuring and maintaining the insurance described in Sections and "Common Area Expenses" shall not include (a) the cost to construct, install, replace, repair or re-locate any Utility Facilities; such costs shall be borne by the applicable Owners; and (b) the District Landscaping Expenses (as defined in Section 2.3.4), but if such District Landscaping Expenses are not applicable (i.e., because the Landscape Maintenance District (as hereinafter defined) is not formed or does not Maintain the Landscape Medians (as hereinafter defined)), then all the provisions of this Declaration concerning the property constituting the Landscape Medians, including, without limitation, the provisions of this Section 1. 7 including as a Common Area Expense the total cost and expense incurred to Maintain the Landscape Medians as a Common Area Improvement, shall continue in full force and effect. #

48 :- -. Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved 1.8 "Common Area Improvements" means the landscaping, irrigation, lighting, parking lot, paved areas, fiber optic security system, vehicular access ways, pedestrian walkways, roadways, bridges, related signs, and other systems and improvements that service the Common Area and the Building Improvements, located or to be located within, over and across, under or on the Common Area, but shall in no event include any Utility Facilities. Additionally, but subject to the terms and conditions of Section 1.7 above and Section below, the Common Area Improvements includes the landscaping located in the medians of Pinole Valley Road between Henry Avenue and Interstate 80 (the "Landscape Medians"). The nature and location of Common Area Improvements may be changed by Declarant as provided in Section "Maintain" or "Maintenance" means to maintain, equip, operate, insure, inspect, protect, repair and replace "Maintenance Director" means the individual or entity appointed pursuant to Section 2.4 to control and Maintain the Common Area and Common Area Improvements as provided in Section 2.3 and otherwise fulfill the obligations of the Maintenance Director under this Declaration "Mortgage" means any duly recorded mortgage or deed of trust encumbering the Parcels or any Parcel "Mortgagee" means the mortgagee or beneficiary under any Mortgage "Owner" means any party that holds fee title to a Parcel, and the successors and assigns of such party. If a holder of fee title to a Parcel ground leases its entire Parcel, then the ground lessee under such ground lease shall become the "Owner" under this Declaration for purposes of all matters in which an Owner has an approval or voting right under this Declaration and shall become obligated, jointly and severally with the fee owner of such Parcel, to pay all amounts due under this Declaration with respect to such Parcel. No ground lease of a Parcel shall relieve the fee owner of such Parcel of any payment obligations due under this Declaration with respect to such Parcel. A tenant or other occupant of a Building under a space lease for all or any portion of such Building shall not become an "Owner" under this Declaration. If more than one party is an Owner of a particular Parcel (e.g., as tenants in common with respect to the fee ownership of a Parcel, or as the ground lessees under a ground lease), then (i) each such party shall be jointly and severally liable for the obligations of the Owner under this Declaration, and (ii) all of such parties must agree in writing when seeking any consent or approval, or exercising any vote, under this Declaration to which the Owner of the Parcel is entitled; if all such parties do not agree in writing with respect to a consent or approval or vote, then the Owner of such Parcel shall be deemed not to have exercised a right for consent, approval or voting "Owners" means collectively the Owners of all of the Parcels "Parcel Map" means the lot line adjustment map recorded by Declarant in the Official Records of Contra Costa County ("Official Records") legally subdividing and describing the Parcels. #

49 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved 1.16 "Pro Rata Share" means the percentage that the square footage of any Owner's Parcel bears to the total square footage of all of the Parcels, which shall conclusively be deemed to be eighty-eight percent (88%) with respect to Parcel A (as identified on Exhibit A attached hereto), seven percent (7%) with respect to Parcel B (as identified on Exhibit A attached hereto), and five percent (5%) with respect to Parcel C (as identified on Exhibit A attached hereto); provided, however, that if Declarant causes a new Parcel Map to be recorded or lot line adjustment(s) to be made as provided in Section 3.6 (except in connection with the changes reflected in the Alternate Site Plan (as hereinafter defined), in which event the foregoing Pro Rata Share percentages shall remain unchanged), then Declarant's land surveyor shall re-determine each Owner's Pro Rata Share effective as of the recordation of the new Parcel Map or lot line adjustrnent(s) and shall provide a written notice of such re-determination to each Owner [Intentionally Deleted] 1.18 [Intentionally Deleted] 1.19 [Intentionally Deleted] 1.20 "Site Plan" means the site plan attached hereto as Exhibit B, together with any revisions to such Site Plan as provided in Section "Substantially Complete" means that an improvement has been constructed to the point where it can be used for the purpose intended although there may be work to be completed that does not materially interfere with the intended use, as determined by the Approving Party in its reasonable business judgment "Utility Facilities" means underground and above ground utility facilities for electrical transmission, telephone, communication cables, conduits for any fiber optic security system, fire and domestic water lines, gas lines, drainage, storm and sanitary sewers, detention/retention facilities, and pumping facilities, fire hydrants or other fire protection installations (including those between the Parcels and the lines or facilities of the governmental body or public utility providing storm drainage and fire protection) and meters for any of the foregoing to the extent related to the provision of utilities to any individual Parcel or the Building on such Parcel. 2.1 Grant of Reciprocal Easements. ARTICLE 2 COMMON AREA Access. Each Owner, as grantor, hereby expressly grants to each other Owner, as grantee, for the benefit of each such other Owner, reciprocal, non-exclusive easements appurtenant to each Parcel for Access (the "Access Easements"). The Access Easements shall become effective with respect to any two or more Parcels only when the Common Area Improvements for such Parcels are Substantially Complete. #

50 - - Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved Drainage. Each Owner, as grantor, hereby expressly grants to each other Owner, as grantee, for the benefit of each such other Owner, reciprocal, non-exclusive easements over and across the Common Area on its Parcel for drainage; provided that such drainage flow shall not materially and adversely affect the granting Owner's use of its Parcel. Any grading by an Owner of its Parcel that impacts the drainage and water run off from its Parcel from that existing as of the date of this Declaration shall be done pursuant to plans and specifications approved by the Approving Party Easements Appurtenant to the Parcels. Easements that benefit or burden any Parcel shall be appurtenant to that Parcel and shall automatically accompany the conveyance of the Parcel, even though the description in the instrument of conveyance may refer only to the fee title to the Parcel. 2.2 I Ise of Common Area General. The Common Area shall be used in compliance with all applicable laws including, without limitation, all laws relating to environmental matters, and in compliance with all rules and regulations promulgated pursuant to Section Subject to the terms and provisions of this Declaration, activities performed in the Common Area shall be performed so as not to create a nuisance or to umeasonably interfere with the operations of any Owner or its Permitted Users. All of the activity permitted within the Common Area, including the construction and maintenance of improvements located thereon, shall be reasonably conducted so as not to interfere, in any material respect, with the rights granted pursuant to this Declaration. No Owner shall be entitled to have any access or engage in activities of any kind on the Parcel of any other Owner except as expressly permitted under this Declaration Standard of Operations. Each Owner shall keep, maintain, repair and operate the Building(s), Building Envelope(s), whether occupied or unoccupied, and the Utility Facilities located on such Owner's Parcel(s) in compliance with all applicable laws and in good and clean order, operation, condition and repair in conformity with first-class standards, in such a manner as to establish, maintain and present, at all times, the appearance of a clean, well-painted, well-managed, attractive and well-coordinated commercial project, as determined by the Approving Party in its reasonable business judgment. Prior to the development by an Owner of its Parcel, the Maintenance Director shall keep the undeveloped Parcel in a presentable condition, free of debris and shall bill the Owner of such undeveloped Parcel for the costs of such work as provided in Section Parking. Each Owner shall comply with the parking ratios as established by Declarant with respect to the Pinole Gateway East Property; provided, that, notwithstanding anything to the contrary contained in this Declaration, no Owner shall be permitted to provide on its respective Parcel less than the number of parking spaces required pursuant to applicable laws, codes, rules and regulations. Each Owner has the right to restrict parking to only the Permitted Users of each such Owner's respective Parcels (including, without limitation, within each such Owner's respective Parcels, by installing signs, painting on parking spaces or implementing other means not otherwise inconsistent with the terms of this Declaration; provided, that, notwithstanding anything to the contrary contained in this Declaration, each such Owner shall be responsible for all costs and expenses and Maintenance in connection therewith), and nothing #

51 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved contained in this Declaration shall be interpreted as creating a reciprocal parking eas~ment between or among any combination of Owners or such Owners' Permitted Users. No changes in the number of parking spaces, or in the configuration of the Common Area from that shown on the Site Plan shall be made without the prior written consent of the Approving Party. Any proposed change to the Common Area must be in compliance with all applicable laws, codes, rules and regulations. Notwithstanding the foregoing, Declarant shall have the right to modify the Site Plan as provided in Section Fees for I Ise of the Common Area. Persons using the Common Area in accordance with this Declaration shall not be charged any fee for such use unless such fee is imposed by a government entity with jurisdiction over the applicable Parcel or improvements thereon Constmction of Common Area Improvements. When an Owner elects to develop its Parcel, it shall cause to be constructed, at its sole cost and expense, all Common Area Improvements for its Parcel. Each Owner shall also be responsible to Maintain the Common Area Improvements located on its Parcel, although each Owner delegates the obligation for such Maintenance to the Maintenance Director as provided in Section The location, configuration, dimensions, specifications, and other elements of all Common Area Improvements to be constructed by an Owner on its Parcel, as well as any proposed alterations to any Common Area Improvements located on a Parcel, are subject to the prior written approval of the Approving Party. In evaluating whether to give its approval to the proposed construction or alteration of such items, the Approving Party shall strive to have Common Area Improvements that are functionally and aesthetically compatible for the Pinole Gateway East Property as a whole and facilitate and support the development and operation of the Pinole Gateway East Property Role of Maintenance Director. Following the completion of the initial Common Area Improvements, each Owner delegates its right to Maintain the Common Area and Common Area Improvements on its Parcel to the Maintenance Director, and agrees that the Maintenance Director shall be the sole party allowed to engage in such activities. The cost to Maintain the Common Area and Common Area Improvements shall be a Common Area Expense, payable by all of the Owners as provided in this Declaration (provided that an Owner of a Parcel shall not be obligated to share in Common Area Expenses until such time as the Common Area Improvements for such Parcel are Substantially Complete). The cost of any alterations to the Common Area Improvements located on a Parcel that have been requested by an Owner and are approved by the Approving Party shall be borne solely by the requesting Owner. 2.3 Maintenance Standards. The Owners shall, through the Maintenance Director as their agent (except with respect to Utility Facilities, which shall be each Owner's respective obligation in accordance with the terms and provisions of this Declaration), Maintain the Common Area and Common Area Improvements in first-class condition and repair. The Maintenance shall conform in type, quantity and quality at least equal to the original design and specifications of the Common Area Improvements, and shall include, without limitation, the following: #

52 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved Maintaining the paved surfaces, striping and bumpers (if installed) in a level, smooth and evenly covered condition with the type of surfacing material originally installed or such substitute as shall in all material respects be substantially equivalent to the original with respect to function and durability; Not less frequently than once every three years following the initial paving of a Parcel, the Owner of such Parcel (by delegation to the Maintenance Director) shall slurry seal and restripe all parking and loading areas on the Parcel; Removing all papers, mud, sand, debris, filth and refuse and sweeping the Common Area to the extent reasonably necessary to keep the Common Area in a clean and orderly condition and provision of trash removal for Common Area trash receptacles; provided that each Owner shall, at its sole cost and expense, obtain trash removal services adequate for the uses of the improvements located on such Owner's Parcel and shall take all reasonable steps at such Owner's cost to limit trash or litter in the Building Areas and the Common Area; Placing, keeping in repair and replacing any necessary and appropriate directional signs, marker lines, bollards and bumpers; Operating, keeping in repair and replacing, where necessary, such artificial lighting facilities as shall be reasonably required; in the Common Area; and Maintaining the landscaping and sprinkler systems installed Providing for any other items of repair, replacement or maintenance that may be needed from time to time to properly Maintain the Common Area and Common Area Improvements Common Area Expenses. Declarant hereby covenants, and each Owner of any Parcel by acceptance of a deed therefor or by entering into a ground lease of a Parcel, whether or not it shall be so expressed in such deed or ground lease, covenants and agrees to pay for its Pro Rata Share of the Common Area Expenses as provided in this Declaration. Each Owner's obligation to commence paying Common Area Expenses with respect to its Parcel shall commence when the Common Area Improvements on its Parcel are Substantially Complete Owner's Cooperation. Each Owner agrees that it will cooperate in all respects with the Maintenance Director and the other Owners to facilitate the Maintenance of the Common Area and Common Area Improvements located on its Parcel(s) for the benefit of the other Parcels. Any such Maintenance shall be carried out with as little interference as is reasonably possible with the business operations located on any Parcel not owned by such Owner Landscape Maintenance District. The City of Pinole, a body politic and corporate (the "c.icy"), intends to form a landscape maintenance district (the "Landscape Maintenance District") to Maintain in first-class condition and repair the Landscape Medians. #

53 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved Notwithstanding anything herein to the contrary, to the extent any costs and expenses are incurred in connection with such landscaping Maintenance for the Landscape Medians (the "District Landscaping Expenses"), such District Landscaping Expenses shall be billed separately from any other costs and expenses payable under this Declaration, including, without limitation, the Common Area Expenses, and each Owner covenants and agrees to pay annually within thirty (30) days following demand therefor its pro rata share of such District Landscaping Expenses, to be calculated by determining the percentage that the square footage of each such Owner's Parcel(s) bears to the sum of the total square footage of(i) all ofthe Parcels, and (ii) all of the "Parcels" as defined in that certain Reciprocal Easement Agreement and Declaration of Covenants, Conditions and Restrictions Running with the Land (Pinole Gateway West), recorded against the property located across Pinole Valley Road from the Pinole Gateway East Property and generally identified on Exhibit D attached hereto (the "Pinole Gateway West CC&R's"), concerning the Pinole Gateway West Property (as defined in the Pinole Gateway West CC&R's). 2.4 Operations Appointment and Duties of the Maintenance Director. So long as Declarant owns fee title to any Parcel, it shall be entitled to appoint the Maintenance Director. When Declarant ceases to own fee title to any Parcel (notice of which Declarant shall deliver to a majority (determined by acreage) of the Owners prior to the date Declarant so ceases to own any such fee title), then, at the election of a majority (determined by acreage) of the Owners, (i) the Maintenance Director shall be appointed by such majority, or (ii) the Maintenance Director may not be appointed, in which event the terms and provisions of Section shall apply. The Maintenance Director may be an affiliate or related entity of an Owner. The rights and obligations of the Maintenance Director shall be set forth in a written agreement between Declarant, as agent for all of the Owners (unless Declarant ceases to own fee title to any Parcel, in which event a majority (determined by acreage) of the Owners shall so perform such function ofdeclarant), and the Maintenance Director, on terms and conditions acceptable to Declarant but consistent with the terms and conditions contained in this Declaration Authority of the Maintenance Director. The Maintenance Director shall have (and is hereby given), on behalf of and as the agent for Declarant and all Owners, the full and exclusive right and authority to Maintain the Common Area and all Common Area Improvements up to each Building Envelope in first-class condition and repair Resignation or Removal of Maintenance Director. The Maintenance Director may resign at any time by giving at least thirty (30) days' prior notice in writing to the Owners. In the event all of the Owners agree in writing or in the event the Maintenance Director is found liable for fraud or willful misconduct in a civil or criminal proceeding or in some other binding form of alternative dispute resolution agreed on by the parties (e.g., arbitration), the existing Maintenance Director shall be removed immediately and a new Maintenance Director shall be selected by a majority (by number) of the Owners. In the event that a Maintenance Director resigns or is removed as provided in this Section , the outgoing Maintenance Director shall, within sixty (60) days after the effective date of its termination as Maintenance Director, provide to all of the Owners a written statement of all costs, fees and expenses which are to be reimbursed to the outgoing Maintenance Director #

54 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved pursuant to the terms of this Declaration. Such sums shall be payable by the Owners to the outgoing Maintenance Director within thirty (30) days after the delivery of such statement. Any such Owner may, at such Owner's expense, conduct an audit of the outgoing Maintenance Director's books and records to verify the sums due so long as such audit is commenced and completed within ninety (90) days after the delivery of the statements. Any new Maintenance Director will, after its appointment in accordance with the terms of this Declaration, perform the obligations of the Maintenance Director set forth in this Declaration throughout the remainder of the term of this Declaration, or until resignation or removal in accordance with the terms of this Declaration When No Maintenance Director Has Been Appointed. During any period of time when no person or entity is appointed to perform the duties of Maintenance Director, each Owner shall have the obligation to Maintain its Parcel at its own expense without contribution by any other Owner in a manner consistent with the provisions of this Declaration. In addition, and notwithstanding anything to the contrary contained in this Declaration, a majority (determined by acreage) of the Owners may, by written notice (the "Removal Notice") to the other Owners, Declarant (so long as Declarant owns a fee interest in any Parcel) and the Maintenance Director to be delivered at any time following the date that is the one (1) year anniversary of the date of issuance of a final certificate of occupancy for the medical services building to be constructed on Parcel A in accordance with the terms and provisions applicable to such construction, remove the requirement for a Maintenance Director under this Declaration (with such removal to be effective on the date that is thirty (30) days following due delivery of such written notice (the "Removal Date")), in which event each Owner shall, beginning on the Removal Date, have the obligation to Maintain its Parcel at its own expense without. contribution by any other Owner in a manner consistent with the provisions of this Declaration Rules and Regulations. The Maintenance Director may make, and in such event shall act reasonably to attempt to enforce or cause to be enforced, reasonable rules and regulations of general application for the supervision, control and use of the Common Area and Common Area Improvements, including, without limitation, vehicular and pedestrian traffic control, restrictions on the level of noise and the intensity of lighting, minimum and maximum hours of lighting, and litter control. Any rules and regulations promulgated by the Maintenance Director must be approved in writing by Declarant so long as Declarant owns fee title to any Parcel, and in the absence of any such fee ownership by Declarant, by a majority (by number) of the Owners. Such rules and regulations shall apply to all Parcels, and each Owner of a Parcel shall be obligated to enforce such rules and regulations against its Permitted Users Contracts. The Maintenance Director is hereby authorized to enter into any contract associated with performing its duties so long as such contract contains a provision for the Maintenance Director or its successor to cancel such contract upon thirty (30) days notice. The Maintenance Director is authorized to pay for, on behalf of the Owners of the Parcels, all Common Area Expenses Books and Records; Expenses. #

55 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved Books and Records. The Maintenance Director shall keep in the State of California accurate books and records with respect to its duties under this Declaration, and shall allow any Owner to audit, on at least five (5) days' prior written notice and at no expense to the Maintenance Director, all records pertaining to the Common Area and its duties under this Declaration. The Maintenance Director shall be required to retain the books and records that relate to Common Area Expenses for any calendar year for a period of one year following the end of such calendar year. The Maintenance Director shall have no obligation to retain such books and records after this one year period Payment of Cammon Area Expenses. The Maintenance Director shall use reasonable efforts to hold Common Area Expenses to a reasonable level consistent with the maintenance, repair and replacement of a first-class commercial project. The Maintenance Director shall reasonably estimate Common Area Expenses in advance for a given calendar year and provide the Owners with a copy of such estimate and each Owner's estimated monthly Pro Rata Share of such Common Area Expenses. The Owners shall pay their estimated monthly Pro Rata Shares of such Common Area Expenses in advance on the first day of each calendar month until the Maintenance Director makes the annual adjustment referred to below. All such payments and any other sums paid by an Owner to the Maintenance Director shall be deposited and held in a checking account established by the Maintenance Director with a federally insured bank or savings and loan association (the "Maintenance Account"). Notwithstanding the foregoing, each Owner shall, on the date the Common Area Improvements on its Parcel are Substantially Complete, prepay six (6) months' of such Owner's estimated Pro Rata Share of Common Area Expenses. The prepaid Common Area Expenses shall be applied against each Owner's Pro Rata Share of Common Area Expenses for the first three months following such prepayment. Thereafter, each Owner shall be obligated to pay its estimated Pro Rata Share of Common Area Expenses in the manner provided in the preceding paragraph. The remaining three months of prepaid Common Area Expenses shall remain in the Maintenance Account as a reserve fund (the "Reserve Fund"), to be used and applied as provided for in this Declaration. Within one hundred twenty (120) days after the close of each calendar year, the Maintenance Director shall provide a written reconciliation to each Owner of the actual Common Area Expenses incurred in the past calendar year and the estimated Common Area Expenses paid by the Owners for such year (the "Written Reconciliation"). The difference between an Owner's Pro Rata Share of the actual Common Area Expenses and an Owner's Pro Rata Share of the estimated Common Area Expenses for a particular year shall be paid or refunded, as appropriate, within twenty (20) days after delivery of the Written Reconciliation. If requested in writing by an Owner, the Written Reconciliation provided to such Owner shall include copies of invoices or other reasonably satisfactory evidence with respect to all Common Area Expenses for such year. The Common Area Expenses for any calendar year as set forth in the Written Reconciliation shall be conclusively deemed to be correct as to an Owner if such Owner does not object in writing within one (1) year following the expiration of such calendar year. The Pro Rata Shares shall be used to allocate Common Area Expenses and to allocate other costs and expenses as provided in this Declaration; provided, however, that the #

56 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved Maintenance Director reserves the right to allocate components of Common Area Expenses or other costs and expenses as provided in this Declaration on a basis other than Pro Rata Shares if the Maintenance Director determines, in its reasonable business judgment, that an allocation on such other basis more equitably allocates such components of Common Area Expenses or other costs and expenses. Each Owner's obligation to pay its Pro Rata Share of Common Area Expenses and other costs and expenses shall be secured by an assessment as provided in Article 7 below I Inanticipated Costs. Notwithstanding anything to the contrary contained in Section , the Owners acknowledge that Maintenance obligations may arise during a calendar year that are not contemplated in the Common Area Expense budget for such year ("Unanticipated Costs"). Provided that the Maintenance Director shall have first delivered notice to, and obtained the consent of Declarant (so long as Declarant owns a fee interest in any Parcel) and a majority (determined by acreage) of the Owners (which consent shall not be unreasonably withheld, conditioned or delayed), with respect to the contemplated incurrence of any Unanticipated Costs, the Maintenance Director shall have the right at any time to bill the affected Owners for any Unanticipated Costs after such costs have been incurred or, at the option of the Maintenance Director, to either (i) cause the Owners to contribute their proportional shares of such Unanticipated Costs as they arise, or (ii) to pay their proportional Shares of Unanticipated Costs in advance (i.e., prior to the Maintenance Director commencing the work that gives rise to the Unanticipated Costs). The Maintenance Director shall apportion such Unanticipated Costs among the Owners of the affected Parcels based on the proportion of the square footage of each affected Parcel to the total square footage of all of the affected Parcels. Any such bill or request for contribution or advance payment shall be paid (as to a bill) or made or paid (as to a request for contribution or advance payment) within five (5) days after written request therefor by the Maintenance Director. Each bill or request for contribution or advance payment of Unanticipated Costs shall be accompanied by a statement that describes the nature of the work that needs to be performed and shall include a copy of invoices, contractors' bids or proposals or other documentation that reasonably substantiates the amounts set forth in the bill or request Management and Supervision Fee. To compensate the Maintenance Director for its services provided under this Declaration, each Owner shall pay the Maintenance Director an annual management fee ("Management Fee") equal to Three Thousand. Five Hundred Dollars ($3,500.00) per acre of land contained in that Owner's Parcel (or Parcels, if an Owner owns more than one Parcel), or, if such Owner's Parcel or Parcels consists of less than one acre, Three Thousand Five Hundred Dollars ($3,500.00); the Management Fee shall increase on each anniversary of the date of this Declaration by multiplying the then-existing annual Management Fee by one hundred two percent (102%). An Owner shall not be obligated to pay the Management Fee with respect to its Parcel until such time as the Common Area Improvements for such Parcel are Substantially Complete. The Owners shall pay the Management Fee to the Maintenance Director in equal monthly installments on the first day of each month. In addition to this Management Fee, which is designed to compensate the Maintenance Director for its services under this Declaration, the Maintenance Director shall also be entitled to receive a supervision fee ("Supervision Fee") for supervising the construction of capital improvements (other than as related to initial construction of such improvements) or #

57 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved capital renovations of the Common Area and/or Common Area Improvements (e.g., repaving all or substantially all of the parking lot, even if in phases). This Supervision Fee shall be equal to ten percent (10%) of the total hard and soft costs of such capital improvements or capital renovations and shall be paid to the Maintenance Director as such work progresses General. Notwithstanding any provisions of this Declaration which may be to the contrary: (a) The Maintenance Director shall be entitled to contract with third party vendors or service providers to fulfill the obligations arising under Section and to satisfy other obligations of the Maintenance Director with respect to the Maintenance of the Parcels, the Common Area and the Common Area Improvements with the cost of such vendors and providers constituting a part of Common Area Expenses; provided, that any such contract shall include a provision requiring such third party vendor or service provider to indemnify the Owners against all claims, costs, damages and expenses to the extent caused by the willful misconduct of such third party vendor or service provider. The Maintenance Director may contract with affiliates to provide such goods and services, provided that the costs charged by such affiliates do not exceed those that would be charged by a non-affiliate. Additionally, the Maintenance Director may bid out various Maintenance contracts for both the Pinole Gateway West Property and the Pinole Gateway East Property in order to provide for more efficient Maintenance services and/or more economical pricing; provided, however, that the vendors under such contracts shall separately bill such Pinole Gateway West Property and the Pinole Gateway East Property for their services. (b) The Owners shall, each to the extent of its Pro Rata Share, indemnify, defend, protect, save and hold harmless the Maintenance Director from and against any and all claims, demands, costs, fees, expenses (including reasonable attorneys' fees and expenses), liabilities and damages (collectively, "Claims") that relate to or arise out of the performance by the Maintenance Director of its obligations under this Declaration, except to the extent that such Claims arise out of the gross negligence or willful misconduct of the Maintenance Director, and the Maintenance Director shall indemnify, defend, protect, save and hold harmless the Owners from and against any and all Claims to the extent caused by the gross negligence or willful misconduct of the Maintenance Director. (c) When a party is removed or resigns as the Maintenance Director, the party shall cease to have any liability or responsibility for any acts, events or circumstances occurring subsequent to and not as a result of its performance or non-performance of its duties or obligations while Maintenance Director. (d) If an Owner's rights under this Declaration are violated or impaired by the acts or omission of another Owner or its Permitted Users, the Maintenance Director shall have no liability to such Owner or its Permitted Users with respect to such act or omission by the other Owner or its Permitted Users Tennination of Owner's Obligations. If any Owner duly sells, conveys or otherwise transfers a Parcel owned by it, then such Owner shall have no further obligation under #

58 --~------~Do-cu-m~en;:-:-ts pr~vided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved this Declaration with respect to such Parcel that arises after the date of such duly executed sale, conveyance or transfer Remedies for Owner's Failme to Pay and Other Defaults. If any Owner fails or refuses at any time to pay its share of any of the Common Area Expenses or other sums due hereunder when due, then, after written demand and failure to pay within five (5) days after receipt of such demand, the unpaid sums shall, starting on the sixth (6 1 h) day after receipt of such demand and continuing until the unpaid sums are paid in full, bear interest (the "Default Rate") at the lesser of (i) four ( 4) percentage points over the then current reference rate of interest as announced by the Bank of America, N.T. & S.A. Main Office, San Francisco, California, or (ii) the maximum rate allowed by law. The Owners recognize that late payment of any Common Area Expenses or other sums due hereunder will result in extra administrative expense to the Maintenance Director including, without limitation, efforts to contact the defaulting Owner and compel payment, notice to the other Owners and collecting the unpaid sums from the other Owners as provided in Section 2.5. The extent of this additional expense and other damage to the Maintenance Director is extremely difficult and economically impractical to ascertain. The Owners therefore agree that if any Common Area Expenses or other sums due hereunder remain unpaid for more than five (5) days after receipt of demand therefore, then the unpaid amount shall be increased, without notice to the defaulting Owner, by a late charge to be paid to the Maintenance Director by the defaulting Owner in an amount equal to four percent (4%) of the unpaid principal amount owing hereunder. The Owners agree that such amount is a reasonable estimate of the loss and expense to be suffered by the Maintenance Director as a result of a late payment by an Owner and may be charged by the Maintenance Director to defray such loss and expense. The provisions of this paragraph shall not be construed to grant any Owner a grace period and shall in no way relieve any Owner of the obligation to pay any amount owing hereunder on the date on which it becomes due. If any Owner defaults under this Declaration, any other Owner and/or the Maintenance Director may institute legal action against the defaulting Owner for specific performance, declaratory relief, damages or other available remedies. In addition to recovery of the sum or sums expended on behalf of the defaulting Owner, the prevailing Owner and/or the Maintenance Director shall be entitled to receive from the defaulting Owner such amount as the court may adjudge to be reasonable, including, without limitation, attorneys' fees incurred in executing on any judgment. At the election of the non-delinquent Owners and/or the Maintenance Director as provided in Article 7 below, any and all delinquent amounts, together with any late charge and interest owing on such delinquent amounts, shall be assessed against and become a lien and charge on each Parcel owned by such defaulting Owner; provided, however, that such lien shall be subject and junior to, and shall in no way impair or defeat, the lien or charge of any bona fide Mortgage on such Parcel(s) at any time given or made whose Mortgagee is not affiliated with such defaulting Owner. Additionally, the Maintenance Director may, in its sole discretion, use the defaulting Owner's share of the Reserve Fund to pay the delinquent sums owed by the defaulting Owner (including any late charge or interest owing on such delinquent sums). If the Maintenance Director should use Reserve Funds as described in the preceding sentence, then the defaulting Owner shall, immediately upon the written demand therefor by the Maintenance Director, replenish the Reserve Fund as to those funds used on the defaulting Owner's behalf #

59 ~ Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved If an Owner should default on any of its monetary obligations under this Declaration more than two times during any calendar year, the Maintenance Director shall have the right, in its sole discretion, to require the defaulting Owner to deposit an additional three months of its Pro Rata Share of the then-estimated Common Area Expenses into the Reserve Fund, to be held as a reserve (and not as a prepayment of the next three months of Common Area Expenses) and applied as provided for in this Declaration Effect of Agreements Between Owner and Tenant. Notwithstanding anything contained herein to the contrary, if the provisions of a particular lease between an Owner and a tenant of that Owner's Building differ with respect to the calculation, time and method of billing and payment of Common Area Expenses or other costs due under this Declaration from the provisions of this Declaration, the lease provisions shall prevail between that Owner and its tenant, but as among the Owners and the Maintenance Director, this Declaration shall prevail. 2.5 Owner's Failure to Perform Obligations. (a) If an Owner (the "Non-Performing Owner") fails to pay any sum within thirty (30) days after notice from Declarant (so long as Declarant has fee title to any Parcel) or from any other Owner or the Maintenance Director, or to perform any obligation under this Declaration within five (5) days after notice from Declarant (so long as Declarant has fee title to any Parcel) or from any other Owner or the Maintenance Director, then Declarant, or such other Owner(~) (the "Performing Owners"), as the case may be, shall have the right, but not the obligation (except as provided in Section 2.5(b) below), to make such payment or perform such obligation on behalfofthe Non-Performing Owner. The Non-Performing Owner shall reimburse Declarant and/or the Performing Owner(s) within thirty (30) days after receipt of an invoice therefor. If such sum is not reimbursed within the required period, then Declarant and/or the Performing Owners shall have, in addition to all other rights and remedies, the rights and remedies specified in Section (b) In addition to the rights described in Section 2.5(a) above, if a Non- Performing Owner fails to pay any sum owing under this Declaration ("Unpaid Costs") within thirty (30) days after notice from Declarant (so long as Declarant owns fee title to any Parcel) or from any other Owner or the Maintenance Director, Declarant or the Maintenance Director shall have the right to require the non-defaulting Owners to pay the Unpaid Costs within thirty (30) days after written request therefor by Declarant or Maintenance Director in any of the following circumstances: (i) if a Mortgagee should foreclose on its Mortgage, thereby terminating any lien assessed pursuant to this Declaration that secures Unpaid Costs; or (ii) Declarant or Maintenance Director determines that the funds held in the Maintenance Account are not adequate to pay the Unpaid Costs, given the need for such funds to be applied against other ongoing Common Area Expenses. Each non-defaulting Owner shall pay its proportionate share of the Unpaid Costs based on the proportion that the square footage of its Parcel beais to the square footage of all of the Parcels ofthe #

60 - D~cume~ts pr-ovided by Dat~Tr~e LLC ~i-;it s proprietary imaging and delivery system Copyright 2003, All rights reserved non-defaulting Owners. In no event shall Declarant or the Maintenance Director have any obligation to pay any Unpaid Costs from any source other than from funds held in the Maintenance Account (including the Reserve Fund) or from funds paid by the non-defaulting Owners pursuant to this Section 2.5, except to the extent Declarant or the Maintenance Director is also an Owner. Each non-defaulting Owner who pays any Unpaid Costs owing by a Non-Performing Owner shall be entitled to exercise all of the rights set forth in Section ARTICLE3 SETBACK/ARCHITECTURAL AND LANDSCAPING APPROVALS/ENVIRONMENTAL MATTERS/EXTERIOR MAINTENANCE/BUILDING AREAS 3.1 Setbacks. The Owners covenant and agree that no building or improvements will be constructed beyond the Building Area within a Parcel, except that Utility Facilities and Common Area Improvements may be constructed in the Common Area as permitted under this. Declaration and by the City. 3.2 Architectma) and Landscaping Approvals. The exterior design, elevations, materials, finishes, colors, signage and lighting of all proposed improvements located in the Building Areas ("Exterior Elements") and all other improvements proposed to be constructed by an Owner on its Parcel shall be constructed, altered, remodeled, painted and replaced in accordance with all applicable laws, any signage guidelines that may be promulgated by the Approving Party and pursuant to plans and specifications reviewed and approved in writing by the Approving Party. The review of the Approving Party shall be solely to ensure that such Exterior Elements and other improvements are reasonably compatible ("Compatible") with the design, elevations, finishes and colors of the improvements located on each of the other Parcels. The Approving Party shall not have the right of approval with respect to any element of a Building that is structural in nature or that relates to the interior of the Building. The Approving Party may prescribe the type and intensity of exterior Building and Common Area lighting used by each Owner in order to ensure uniformity and harmony of the lighting schemes for the Parcels and to comply with the requirements of Declarant. Notwithstanding anything to the contrary contained in this Declaration, the Approving Party's approval shall be deemed given with respect to those portions of any plans and specifications consistent with the terms, conditions and requirements of (i) that certain Pinole Gateway East Project Final Environmental Impact Report dated December 2004, (ii) that certain City of Pinole Design Review Staff Report Memorandum from Elizabeth Dunn, AICP, City Planner, to the Design Review Board, dated October 14, 2004, with the subject heading of "Item for October 14, 2004 Regular Meeting", and (iii) that certain City of Pinole Planning Commission Staff Report Design Review and Conditional Use Permit for the Pinole Gateway East Project, dated December 13, 2004, and referenced as Agenda Item F-3. All plans and specifications submitted for approval to the Approving Party shall be approved or disapproved in writing within sixty (60) days and any objection shall be made with specificity. The failure to approve or disapprove in writing any request for approval within such period shall be deemed an approval. Approval shall not be unreasonably withheld, and shall be given if such proposed improvements are Compatible. Plans and specifications shall be #

61 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved professionally prepared by licensed architects and/or engineers, as applicable. All paint and sign colors shall be submitted with professional samples. The Approving Party's review of the plans and specifications as provided in this Section 3.2 shall be solely for the purpose of ensuring that the improvements contemplated therein are Compatible. The Approving Party's review and approval of such plans and specifications shall not.be interpreted to be an assurance that such plans and specifications and the improvements constructed therefrom are or would be structurally sound, free of defects or in compliance with applicable laws, codes, rules and regulations. The Approving Party shall have no liability to the submitting Owner or to any other party based on its review and approval of such plans and specifications. No Owner shall commence any construction, alteration, remodeling or other change to Exterior Elements or to other improvements located on its Parcel, the cost of which would reasonably be expected to exceed Fifty Thousand Dollars ($50,000.00), without first obtaining the approval set forth in this Section 3.2 ("Design Approval"). If an Owner should commence such work without first obtaining Design Approval, then the Approving Party or any Owner shall be entitled to seek equitable relief (including, without limitation, temporary restraining orders or preliminary injunctions) against the breaching Owner, it being agreed by all Owners that there is no adequate remedy available at law for such a breach. Each Owner agrees that the amount of actual damages that it would incur in the event of such a breach is, under the circumstances existing as of the date of this Declaration, impractical and extremely difficult to ascertain and that the amount set forth in this paragraph is a reasonable amount in order to compensate the non-breaching Owners for such breach, but payment of such amount shall not be deemed to cure such breach, it being agreed that the equitable relief provided for under this paragraph shall nonetheless remain available with respect to any such breach. 3.3 Environmental Matters. (a) Each Owner hereby covenants that it shall not nor shall it allow its Permitted Users to use, store, dispose, release, discharge, transport or generate (collectively "Use of Hazardous Substances") any Hazardous Substances (as defined below), in, on, to, under, from or about its Parcel without the prior written consent of the Approving Party, which consent may be granted, withheld or conditioned as the Approving Party shall decide in its sole discretion. Notwithstanding the foregoing and subject to the other provisions of this Section 3.3, (i) any Owner who constructs and operates a medical office building may Use such Hazardous Substances as are typically used in the operation and maintenance of first class medical office buildings, and (ii) the Owners may Use such Hazardous Substances as are typically used by operators of first class commercial projects that contain the types of buildings and are engaged in the types of uses as are generally contained and engaged in on the Pinole Gateway East Property ("First Class Project"). (b) Any Use of Hazardous Substances by any Owner shall be conducted in strict accordance with all Environmental Laws (as defined below) and prudent business practices. No consent or approval by the Approving Party to an Owner's Use of Hazardous Substances shall constitute an assumption of risk respecting the same or a warranty or certification by the Approving Party that the proposed Use of Hazardous Substances is safe or reasonable or in #

62 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved compliance with Environmental Laws. Each Owner shall maintain current all permits required for its operations, including, without limitation, those for the Use ofhazardous Substances. (c) Each Owner shall indemnify, defend (by counsel reasonably acceptable to the indemnified party), protect and hold Declarant free and harmless from and against any and all claims, liabilities, penalties, forfeitures, losses or expenses (including, without limitation, attorneys' fees and costs and court costs) or death of or injury to any person or damage to any property whatsoever, arising from or caused in whole or in part, directly or indirectly, by such Owner's Use of Hazardous Substances or such Owner's failure to comply with any Environmental Law. This indemnification shall include without limitation (a) personal injury claims, (b) the payment of liens, (c) diminution in the value of any Parcel or the improvements thereon, (d) damages for the loss of use or restriction of use of any Parcel, (e) sums paid in settlement of claims, (f) attorneys' fees and costs, consulting fees and costs and expert fees and costs, (g) the cost of any investigation of site conditions, and (h) the cost of any repair, clean-up, health or other environmental assessments, remedial, closure, removal or restoration work, decontamination or detoxification if required by any governmental or quasi-governmental agency or body having jurisdiction or deemed necessary in the Approving Party's reasonable business judgment. (d) The term "Hazardous Substances" shall mean hazardous wastes, hazardous chemicals, flammable or explosive materials, biological and medical waste, radioactive materials, toxic materials or related materials (whether potentially injurious to persons or property and whether potentially injurious by themselves or in combination with other materials), including, but not limited to, any waste, chemical, substance or material now or hereafter determined by any federal, state or local governmental agency or authority having jurisdiction to be hazardous to human health or the environment or which is or becomes regulated by such agency or authority (including, but not limited to, those materials listed in the United States Department oftransportation Hazardous Materials Table as amended from time to time and gasoline, other petroleum based products and any fractions thereof), which are released to the environment, including, without limitation, the soil, groundwater and/or air, at, under or above a Parcel or the Pinole Gateway East Property. The term "Environmental Laws" shall mean any and all present and future federal, state and local laws (whether under common law, statute, rule, regulation or otherwise), requirements under permits issued with respect thereto, and other requirements of governmental authorities relating to the environment or to any Hazardous Substance (including, without limitation, the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as heretofore or hereafter amended from time to time). 3.4 Canstmctian Activities. Each Owner agrees that all construction, alteration, remodeling and reconstruction performed by or on behalf of such Owner on its Parcel and in its Building Area shall be in compliance with this Declaration and all applicable laws, codes, rules and regulations. Each Owner agrees that all improvements constructed by it on its Parcel shall be constructed in a good and workmanlike maimer, using prime quality materials. Each Owner acknowledges that other Owners may be constructing Building Improvements, Common Area Improvements and/or Utility Facilities at the same time. Each Owner agrees to work diligently and in good faith with the Maintenance Director and any other Owners who are undertaking #

63 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved construction activities at the same time so that each Owner can proceed with as little interference from and causing as little interference to the others as possible. Each Owner agrees that it shall abide by reasonable, non-discriminatory rules and regulations promulgated by the Approving Party that govern construction activities, including, without limitation, construction activities that overlap in time. Such rules and regulations may govern, among other things, the time and location for deliveries, parking areas for tradespeople and suppliers, staging areas, the fencing off of construction areas, routes of access within the Pinole Gateway East Property, and coordinating the construction schedules ofthe various parties. 3.5 Exterior Maintenance. Each Owner agrees to Maintain, as needed and at its sole cost and expense, the exterior of the Building on its Parcel and all other Exterior Elements in a clean, visually attractive, safe and sanitary condition, all consistent with the standards of a First Class Project. If the Approving Party determines that an Owner is failing to comply with the foregoing obligations, the Approving Party may take appropriate steps, including but not limited to bringing an enforcement action under Section 9.2, to bring the defaulting Owner into compliance. If any Building is completely or partially unoccupied, the Owner of such Building agrees that it shall keep the exterior lighting for its Building on during nighttime hours, that it shall not board up or cover the windows of its Building, and that it shall regularly inspect its Building and take such other steps as are reasonably needed to keep the Building from becoming an eyesore or a target for vandalism or squatters. 3.6 I.ocations. The location of the Building Areas on each Parcel are shown on the Site Plan. No improvements may be constructed outside of the Building Areas by any Owner other than Common Area Improvements and Utility Facilities that have been pre-approved in writing by the Approving Party. All improvements constructed within a Building Area are subject to Design Approval as provided in Section 3.2. There must be sufficient Common Area on a Parcel to provide parking in the ratios required by Section Notwithstanding anything to the contrary contained in this Declaration but subject to the parking requirements of Section 2.2.3, so long as Declarant owns any Parcel, Declarant shall be entitled to revise the Site Plan and/or the Parcel Map from time to time with respect to any Parcel then owned by Declarant (including altering or revising the location and/or configuration of Building Areas, Common Area, Common Area Improvements and/or Utility Facilities on any such Parcels owned by Declarant or making lot line adjustments with respect to Parcels then owned by it) without the prior approval of any other Owner. Any such revision of the Site Plan and/or Parcel Map shall become effective as to all of the Parcels and shall constitute an amendment of this Declaration effective as of the date the revised Site Plan and/or Parcel Map is recorded by Declarant as an amendment to this Declaration in the Official Records. The Owners authorize Declarant to record against their Parcels any such amendment to this Declaration. ARTICLE4 INDEMNIFICATION/INSURANCE 4.1 Indemnification. Each Owner ("Indemnitor") hereby agrees to defend, indemnify, protect, save and hold harmless Declarant, the City and the Maintenance Director, their partners, members and managers, each of their respective officers, directors, shareholders, employees, agents and attorneys, and each of their respective affiliates, successors and assigns #

64 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved (individually, an "Indemnitee" and collectively, the "Indemnitees") from and against any and all liability, damage, expense (including reasonable attorneys' fees and expenses), causes of action, suits, claims or judgments suffered by the Indemnitees arising from personal injury, death or property damage and occurring from the exercise by the Indemnitor of its rights hereunder, the breach of any provision hereof by such Indemnitor, or the failure of the Indemnitor to fulfill its obligations hereunder. No Indemnitor shall be responsible for the gross negligence or willful misconduct of Declarant, the Maintenance Director, or any other Owner. For purposes of this Section 4.1, the act of an Owner's Permitted User shall be deemed to be the act of that Owner. 4.2 Insmance Owner's Commercial General Liability Tnsmance. Each Owner shall, at its sole cost and expense, procure and maintain in full force and effect throughout the term of its ownership of a Parcel, policies of commercial general liability insurance against claims for personal injury, death or property damage occurring upon, in or about such Owner's Parcel caused by or resulting from any act or omission of such Owner or its Permitted Users, each Owner's insurance to afford protection to the limit of not less than Two Million Dollars ($2,000,000.00) for injury to or death of a single person, and to the limit of not less than Five Million Dollars ($5,000,000.00) for injury to or death of more than one person in any one occurrence, and to the limit of not less than Five Hundred Thousand Dollars ($500,000.00) for property damage. Such insurance may be written by additional premises endorsement on any master policy of insurance carried by the Owner which may cover other property in addition to the property covered by this Declaration. Such insurance shall name the other Owners, Declarant and the Maintenance Director as additional insureds, shall be on an "occurrence" basis, rather than a "claims made" basis, shall provide that the same may not be canceled without thirty (30) days' prior written notice to the other Owners, Declarant and the Maintenance Director, and shall be primary and non-contributing with the commercial general liability insurance maintained pursuant to Section Common Area Commercial General T.jahility lnsmance. ~xcept to the extent any Owner self-insures pursuant to the terms and provisions of Section 4.2.9, the Maintenance Director shall procure and maintain in full force and effect throughout the term of this Declaration policies of commercial general liability insurance against claims for personal injury, death or property damage occurring upon, in or about the Common Area or caused by or resulting from any act or omission of the Maintenance Director or its employees, agents and contractors, such insurance to afford protection to the limit of not less than Two Million Dollars ($2,000,000.00) for injury to or death of a single person, and to the limit of not less than Five Million Dollars ($5,000,000.00) for injury to or death of more than one person in any one occurrence, and to the limit of not less than Five Hundred Thousand Dollars ($500,000.00) for property damage. Such insurance shall name Declarant and the Owners as additional insureds, shall be on an "occurrence" basis, rather than a "claims made" basis, and shall provide that the same may not be canceled without thirty (30) days' prior written notice to the Owners and Declarant Common Area Casualty Insurance. Except to the extent any Owner selfinsures pursuant to the terms and provisions of Section 4.2.9, the Maintenance Director shall procure a policy or policies of insurance on behalf of the Owners insuring against the perils #

65 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved insured against by the standard all-risks property insurance, including vandalism and signage coverage, in an amount equal to one hundred percent (100%) of the replacement value of the Common Area Improvements (up to the Building Envelopes), exclusive of foundations and excavations, as such value shall be determined on an annual basis Cost of Tnsmance. The cost of procuring and maintaining the insurance described in Sections and shall constitute a Common Area Expense and shall be included in the annual budgets prepared by the Maintenance Director pursuant to Section ; provided, that, notwithstanding anything to the contrary contained in this Declaration, no Owner shall be required to pay any portion of such cost to the extent such Owner self-insures pursuant to, and in accordance with, the terms and provisions of Section 4.2.9; in such event, the remaining, non-self-insuring Owner(s) shall pay its/their pro rata share(s) of such costs in accordance with the terms and provisions of this Declaration based on the percentage that the square footage of any such non-self-insuring Owner's Parcel(s) bears to the total square footage of the non-self-insuring Parcel(s) Coverage Increases. The amount of liability insurance coverage required under Sections and may be increased (but not decreased) every three (3) years to a then commercially reasonable amount as determined in writing by the Approving Party. The Approving Party shall have the right to increase the limits and/or change the terms of coverage required to be carried by the Owners and/or the Maintenance Director under this Declaration if such limits and/or terms of coverage are below or different from those carried or required to be carried by prudent operators of commercial projects similar to the Pinole Gateway East Property Tnsmers and Additional Insmeds. Policies of insurance provided for in this Section 4.2 shall be issued by companies rated A- or better and at least an X in "Best's Key Rating Guide." Each party obligated to procure and maintain insurance under this Section 4.2 shall provide the Owners and the Maintenance Director with evidence of insurance (ACORD Form 27 or other reasonably acceptable form), evidencing the fact that such insurance has been obtained immediately upon an Owner acquiring title to its Parcel. Each such party shall also provide the Owners and Maintenance Director with evidence that such insurance has been renewed at least sixty days prior to the expiration of the then-existing insurance policy Releases. Each Owner for itself and its property insurer hereby agrees to release each other Owner, Declarant, the Maintenance Director and their respective property insurers from and against any and all liabilities, claims, causes of action, obligations, demands, damages, losses, costs, or expenses, including attorneys' fees and costs, for damage to such Owner's property or loss of rents or profits resulting from or in any way connected with any fire or other casualty whether or not such fire or other casualty shall have been caused by the negligence or the contributory negligence of the Owner, Declarant or the Maintenance Director being released, or by any officer, director, shareholder, partner, member, manager, agent or employee of the Owner, Declarant or the Maintenance Director being released, this release being limited to the extent that such damage or loss is covered by the property insurance which the releasing Owner, Declarant or the Maintenance Director is obligated hereunder to carry, or, if the releasing Owner, Declarant or Maintenance Director is not carrying that insurance, then to the extent such damage or loss would be covered if the releasing Owner, Declarant or Maintenance Director were carrying that insurance, provided, however, that this release shall be limited by and #

66 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved coextensive with the terms and provisions of the waiver of subrogation clauses (or endorsements or clauses consenting to a waiver of a right of recovery) provided for in Section This release, subject to the limitation in the preceding sentence, extends to all liabilities, claims, causes of action, obligations, demands, damages, losses, costs or expenses, including attorneys' fees and costs, whether known or unknown, suspect~d or unsuspected, matured or unmatured, contingent or fixed, liquidated or unliquidated, arising directly or indirectly out of the subject matter of this release. The Owners hereby agree to waive all of their rights under California Civil Code Section 1542, and acknowledge that they have been advised that the section reads as follows: "Certain Claims Not Affected by General Release. A General Release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor." Each Owner, lessee, sublessee, Mortgagee, trustee or beneficiary, in accepting a conveyance of an interest in any Building or Parcel shall be deemed to have agreed that it is a party to the foregoing release, and to the waiver of such Owner's potential rights under California Civil Code Section Waiver of Subrogation and Other Provisions of the Policies. Each policy of insurance required under this Declaration shall contain a waiver by the insurer of any and all rights of subrogation against each other Owner, Declarant and the Maintenance Director, and their officers, directors, shareholders~ partners, members, managers, employees, agents, associates and representatives, and each insurance policy shall provide that any "no-control" provision in that policy is excluded or superseded by an endorsement providing that the insurance obtained pursuant to this Section 4.2 shall not be prejudiced by any act or omission of any of the insureds when such act or omission is not within the actual knowledge and control of all of the insureds collectively anq shall likewise not be prejudiced by any failure of the insureds, individually or collectively, to comply with any warranty or condition with regard to any portion of any Parcel or the improvements thereon over which each insured individually, or the insureds collectively, have no control. Each insurance policy shall provide that it may not be canceled, suspended or avoided in whole or in part by reason of any act, omission or breach of any covenant, condition or restriction contained herein. If an Owner should ground lease, lease, sublease, or otherwise convey or transfer an interest in all or any part of the Building on its Parcel, or its Parcel, it shall cause the ground lessee, lessee, sublessee and transferee to provide a waiver of subrogation in favor of the other Owners, Declarant and the Maintenance Director similar to the waiver contained in this Section Self-Insurance. Notwithstanding anything to the contrary contained in this Section 4.2, as long as any Owner maintains a tangible net worth in excess of $200,000,000.00, such Owner (for purposes of this Section 4.2.9, a "Self-Insuring Party") shall be entitled to selfinsure its insurance requirements set forth under this Section 4.2, and the insurance requirements applicable to the Common Area located on its Parcel(s). Any such self-insurance shall be deemed to contain all of the terms and conditions applicable to the insurance otherwise required to be maintained pursuant to this Section 4.2, including, without limitation, with respect to all #

67 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved waivers of subrogation. If an Owner elects to so self-insure, then with respect to any claims that may result from incidents occurring during the term of this Declaration, such self-insurance obligation shall survive the expiration or earlier termination of this Declaration to the same extent as the insurance required would survive. Self-insurance shall mean that the Self-Insuring Party is itself acting as though it were the insurance company providing the insurance required under the terms and provisions of this Section 4.2 and the Self-Insuring Party shall pay amounts due in lieu of insurance proceeds, including, without limitation, all deductibles because of selfinsurance, which amounts shall be treated as insurance proceeds for all purposes under this Declaration, to the extent that a third-party insurance company would have paid such amounts if the insurance company were insuring the risks under the policy or policies described in this Section 4.2, and undertake the defense of any claims, including, without limitation, a defense of the other Owners, Declarant and the Maintenance Director, at the Self-Insuring Party's sole cost and expense to the extent that a third-party insurance company would have undertaken such defense. All amounts that the Self-Insuring Party pays or is required to pay and all loss or damage resulting from risks for which the Self-Insuring Party has elected to self-insure shall be subject to the waiver of subrogation provisions of this Section 4.2 and the exercise by the Self Insuring Party of its right of self-insurance shall not in any manner limit any of the Self-Insuring Party's indemnification obligations under this Declaration. The Self-Insuring Party hereby agrees to indemnify, defend, protect, save and hold harmless the other Owners, Declarant and the Maintenance Director from and against any and all Claims that relate to or arise out of the election by the Self-Insuring Party to so self-insure rather than to so obtain insurance through a third-party insurer. ARTICLE 5 DAMAGE AND DESTRUCTION/CONDEMNATION 5.1 Damage and Destmction of Common Area Improvements. To the extent insured by the Maintenance Director, on any damage or destruction to any Common Area Improvements, the Maintenance Director shall promptly restore or repair the same to a condition at least equal to that which existed immediately prior to the event causing such damage or destruction using the insurance proceeds available for such restoration or repair. To the extent that the cost of such restoration or repair exceeds the available insurance proceeds, the excess costs shall constitute Unanticipated Costs and shall be paid by the Owners as provided in Section Damage and Destmction. On any damage or destruction to any Common Area Improvements not insured by the Maintenance Director, any Building Improvements or any other improvements within the Building Envelope, the Owner of such Common Area Improvements, Building Improvements or such other improvements shall, at its sole cost and expense, promptly and diligently either (i) cause the repair or rebuilding of such Common Area Improvements, Building Improvements or such other improvements to a condition at least equal to that which existed immediately prior to the event causing such damage or destruction, or (ii) cause such Common Area Improvements, Building Improvements or such other improvements to be demolished, the debris to be properly disposed of and the affected area of the Parcel to be leveled, paved and put in an otherwise presentable condition, as determined by the Approving Party in the reasonable exercise of its discretion. #

68 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved 5.3 Condemnation. In the event of any condemnation by any duly constituted authority for a public or quasi-public use, or deed in lieu thereof, of all or any part of any Parcel, the portion of the award attributable to the value of any land and improvements within the Common Area on such Parcel shall be payable only to the Owner thereof, and no claim therefor shall be made by any other Owner; provided, however, that the other Owners may file collateral claims with the condemning authority over and above the value of the land taken, and provided further, however, that the Owner of any Parcel only a portion of which is so condemned shall promptly repair and restore the remaining portion of the Parcel as nearly as practicable to its condition immediately prior to the condemnation, at such Owner's sole cost, without contributions from any other Owner. The Owners appoint the Maintenance Director as their exclusive agent to conduct such repairs and restoration as provided in Section 2.2.6, with the Owner whose Parcel is taken by condemnation funding the cost of such work. Upon any such taking, the easement rights granted hereunder shall terminate with respect to the portion so taken but shall continue in full force and effect with respect to any portion not so taken. Nothing herein contained shall prevent a tenant from making a claim against an Owner pursuant to the provisions of any lease between an Owner and tenant for all or any portion of any such condemnation award or payment. ARTICLE 6 RIGHTS OF MORTGAGEES Any notice served upon any Owner pursuant to this Declaration shall be served concurrently on any Mortgagee of the Parcel owned by such Owner that has previously notified the other Owners of such Mortgagee's address in the manner provided for in this Declaration; provided, that failure to serve any such notice on any such Mortgagee shall not invalidate the effect of any such notice served upon any such Owner. No breach of any covenant, condition or restriction contained in this Declaration shall render invalid the lien of any Mortgage. Any payment by any Mortgagee of any delinquent assessments shall have the same force and effect as if made by the delinquent Owner and such Mortgagee shall have all rights of subrogation against the delinquent Owner as may be available to such Mortgagee under its Mortgage and/or under applicable law. All of the easements, covenants, conditions and restrictions contained herein shall inure to the benefit of and be binding on any Owner whose title is derived through foreclosure, trustee's sale, deed in lieu thereof or otherwise. Any Mortgagee or purchaser therefrom who takes title to any Parcel pursuant to a foreclosure of the lien of such Mortgage or a sale under a power of sale included in such Mortgage or otherwise, shall take title free of any lien on such Parcel arising under this Declaration which accrued prior to the date such Mortgagee or purchaser takes title thereto, and such Mortgagee or purchaser shall be liable for the obligations that shall accrue only during the period of time such Mortgagee or purchaser is the Owner of such Parcel. ARTICLE 7 LIEN RIGHTS 7.1 Agreement to Pay. Each Owner covenants and agrees for each Parcel owned by it that such ownership, and the ownership thereof by each successor and assign of such Owner, is expressly made subject to assessments permitted under this Declaration including, without #

69 Documents provided by Data Tree LLC via it's proprietary imaging and delivery system Copyright 2003, All rights reserved limitation, assessments arising from the failure of an Owner to pay amounts owing by it under this Declaration as provided in Section Each Owner, on becoming an Owner of a Parcel, covenants and agrees for each Parcel owned by such Owner (i) to pay to the party entitled thereto any such assessments levied in accordance with the provisions of this Declaration, (ii) to allow the party entitled thereto to enforce any assessment lien established in accordance with the provisions of this Declaration including, without limitation, through judicial or nonjudicial foreclosure, and (iii) to grant to the Approving Party a power of sale under which to enforce any assessment lien created under this Declaration. 7.2 A ssessmentsa.iens and Personal Obligation of Owner. Until paid in full, each assessment, together with all collection costs, including reasonable attorneys' fees and costs, shall be a lien upon the Parcel and the improvements thereon against which each such assessment is made, and shall be binding on the Owner and on all successors to the Owner's interest in its Parcel. Each such assessment, together with such collection costs and attorneys' fees and costs, shall also be the personal obligation of the Owner of such Parcel at the time the assessment becomes due and payable. No Owner or Mortgagee may be relieved from the obligation to pay any such assessment by waiving the use or enjoyment of all or any portion of the Common Area or the Common Area Improvements, or by abandoning some or all of its Parcel(s). 7.3 Levying of Assessments. If the Approving Party determines that any assessment shall be levied as allowed in this Declaration, the Approving Party shall provide written notice to the Owner and Mortgagee, if any, of the Parcel against which the assessment is to be made of such assessment, describing the amount ofthe assessment, the reason therefor, and the date upon which payment is due, which date shall not be less than five (5) days from the date of such notice. If such assessment is not paid by the date specified for payment, interest shall accrue upon such assessment at the Default Rate. At any time after the occurrence of any delinquency in the payment of any such assessment, the Approving Party may thereafter elect to file and record a Notice of Claim of Lien against the Parcel of the defaulting Owner in the Official Records. The amount of the assessment, plus any costs of collection and interest assessed in accordance with this Declaration, shall be a lien on the Owner's Parcel and the improvements located thereon from and after the time such Notice of Claim of Lien is recorded. 7.4 Notice of Claim of Lien. Any Notice of Claim of Lien prepared with respect to any assessment levied pursuant to this Declaration shall be a statement under oath and shall describe the amount of the delinquent assessment (including collection costs and attorneys' fees and costs, if known), the date on which demand for payment was made, the basis for the assessment, a description of the Parcel, the name of the Owner of the Parcel to be liened, the name of any ground lessee whose improvements are to be liened, the name and address of the claimant, and a statement that such assessment is due and owing under this Declaration. Such Notice of Claim of Lien shall be executed and acknowledged by a person having authority to execute deeds on behalf of the claimant. If the delinquent assessment (including related collection charges and attorneys' fees and costs) is paid or otherwise satisfied in full, the party recording such Notice of Claim of Lien shall record a notice of satisfaction and release of lien. 7.5 Foreclosure Tinder Assessment Lien. The party recording any Notice of Claim of Lien may enforce such lien established hereunder by filing an action for judicial foreclosure or by recording a notice of default in the form described in the California Civil Code to commence a #