II. Terms of the Lease
The initial term of the lease is 30 years, beginning on the date CT exercises the option. CT may renew the lease for two additional 10-year terms. Under the Agreement, CT will pay an annual base rent of $35,800 in the first year and $71,500 in the second year. The base rent will be adjusted in year 3 through year
20 with an increase of 3% per annum. At the end of the 30th year and upon exercise of each of the two renewal options, the base rent shall be further adjusted to reflect the then current fair rental value of the Site, excluding the value of CT's improvements. In no event, however, will the adjusted base rent be less than the base rent otherwise payable immediately prior to such adjustment.
The Agreement provides that CT's self-storage activities must not interfere with the operation of the electrical transmission facilities that cross the Site. CT is not allowed to use or store hazardous substances, explosives or flammable materials on the Site. Any equipment used by CT on or adjacent to the Site will be used and operated to maintain a minimum clearance of 18 feet from all overhead electrical conductors. SCE also requires CT to maintain a minimum of 50 foot radius around all tower legs, and a 10 foot radius around all steel poles, wood poles, and anchors. SCE will also require CT to provide and maintain access roads on the property that are at least 16 feet wide and capable of supporting a gross load of 40 tons on a three-axle vehicle. SCE will also have the right to approve construction plans and specifications and the ability to review the selection of a general contractor for the development project.
SCE retains the right and authority to enter the Site at all reasonable times to inspect the property to perform work, if necessary, on the electrical facilities located on the property. SCE has the right to impose temporary restrictions on CT's right to enter, occupy and use the property. SCE also retains the right to take all or a part of the leasehold by eminent domain or inverse condemnation.
CT is responsible for all personal property taxes, as well as other general or special assessments or fees levied against the Site or the improvements thereon. CT is also responsible for obtaining all permits and approvals for construction and any zone changes or use permits and approvals for construction and any zone changes or use permits required for the operation of a self-storage facility. CT must also maintain appropriate comprehensive general liability insurance, comprehensive auto liability insurance, and workers' compensation insurance. CT has agreed to indemnify SCE against all liability for damages or injury to persons on the Site except to the extent caused by SCE's negligent or willful conduct.
