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<br />4859-3312-3005v3
<br />
<br />ARTICLE 3.
<br />THE IMPROVEMENTS
<br />Section 3.1 Construction. Lessee shall cause the Improvements to be rehabilitated in
<br />compliance with the Construction Plans approved by City and the terms and conditions of
<br />Project land use permits and approvals and building permits. Any and all Improvements
<br />constructed or rehabilitated by or on behalf of Lessee shall be constructed and rehabilitated in a
<br />good and workmanlike manner, in compliance with all applicable Legal Requirements. Lessee
<br />shall bear the entire and sole cost of planning, designing, engineering, financing, constructing,
<br />rehabilitating, supervising, and inspecting the Improvements, including all fees and mitigation
<br />measures. Lessor acknowledges that as of the Commencement Date, the City has approved the
<br />Construction Plans.
<br />Section 3.2 Liens. Lessee shall not have any right, authority or power to bind Lessor,
<br />Lessor’s Estate, or any interest of Lessor in the Land or the Leased Premises, for any claim for
<br />labor or material, or for any other charge or expense, lien or security interest incurred in
<br />connection with Lessee’s use of the Land, or the development, rehabilitation, construction or
<br />operation of the Improvements, or any change, alteration or addition thereto. Lessee shall have
<br />the right to encumber Lessee’s Estate with security instruments required in connection with the
<br />Approved Loans, and with utility easements and other customary easements necessary and
<br />incidental to the development, rehabilitation, construction and operation of the Improvements,
<br />provided that such easements are subject to the approval of Lessor, which shall not be
<br />unreasonably withheld, conditioned or delayed.
<br />The Lessee shall not create or permit or suffer to be created or to remain upon the
<br />Lessor’s Estate or any interest of Lessor in the Land or the Leased Premises, or upon the Leased
<br />Premises, or any part thereof, and will discharge, any lien, including, but not limited to, the liens
<br />of mechanics, laborers, materialmen, suppliers or vendors for work or materials alleged to be
<br />done or furnished in connection with the Leased Premises or the Project, or any part thereof. If
<br />any claim of lien is filed against the Lessor’s Estate or any interest of Lessor in the Land or the
<br />Leased Premises, or a stop notice is served on any other lender or other third party in connection
<br />with the Leased Premises or the Improvements, or upon the Leased Premises, or any part thereof,
<br />then the Lessee shall, within twenty (20) days after such filing or service, either pay and fully
<br />discharge the lien or stop notice, effect the release of such lien or stop notice by delivering to the
<br />Lessor a surety bond in sufficient form and amount, or provide the Lessor with other assurance
<br />satisfactory to the Lessor that the claim of lien or stop notice will be paid or discharged. If the
<br />Lessee fails to discharge any lien, encumbrance, charge, or claim in the manner required in this
<br />Lease, then in addition to any other right or remedy, the Lessor may (but shall be under no
<br />obligation to) following not less than 10 days’ written notice to Lessee, discharge such lien,
<br />encumbrance, charge, or claim at the Lessee’s expense. Any expense incurred by Lessor
<br />pursuant to this Section shall be immediately due and payable by Lessee to Lessor as Additional
<br />Rent under this Lease. The Lessee shall have the right to contest in good faith and by
<br />appropriate legal proceedings the validity or amount of any mechanics’, laborers’,
<br />materialmen’s, suppliers’ or vendors’ lien or claimed lien; provided that the Lessee shall utilize
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