HomeMy WebLinkAbout15-Police Department
.
'. city OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION
From: Lee Dean. Chief of Po1ice
Subject: Authorize Lease for PoHce Ccmmnity
Service Office at 941 Kendall Drive
Suite A&H. San Bernanli.no. CA 92407
Dept: Po1ice
ORIGINAL
Date: April 1. 1998
Synopsis of Previous Council action:
May 15. 1989 -- Reso1.ution No. 89-155 authorizing the execution of an C1!:I.L"",nent with
Stater Bros. Market. Inc. to 1ease certain real property f= the
pl.acement of a 1eased trailer to be used as a PoHce Ccmmnity Service
Office f= Area "D".
Recommended motion:
lIdopt Reso1.ution
Contact person: Chief Lee Dean
Phone: 384-5607
Supporting data attached: Yes
Ward: 'it-h W"Trl
$1.00 per yr x 5 yrs
Amount: $5.00
FUNDING REQUIREMENTS:
Source: (Acct. No.) 001-213-5181
(Acct. DescriPtion)other Qperat~2 ~.
Finance: ~ . //"'---
Council Notes:
1jtJ.D/9!-
75-0262
Agenda Item No. IS
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. CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION
STAFF REPORT
SUBJECT: Approval of Resolution for the Relocation of Area "B" Community Service Office.
BACKGROUND: We currently have an opportunity to relocate the Area "B" Police
Community Service Center, which will enhance the area command and provide an attractive,
functional environment for department personnel and community members. The relocation of
the facility will provide a permanent structure and bring Area "B" into alignment with the other
area commands.
Since 1984, the Police Department has adopted Community Oriented Policing and established
area commands throughout the city. Currently there are five area commands, each having at
least one Community Service Office. In December 1987, a study entitled "An Analysis of
Community Oriented Policing in the City of San Bernardino" was conducted to determine the
appropriate location for the community offices based on established criteria. The specific criteria
included optimal visibility, adequate parking, central location within the area command, and
convenience to the public.
Currently, the Area "B" Community Service Office is located at 911 Kendall Drive in a leased
trailer at the cost of$1 per year. The leased trailer occupies land leased from Stater Bros.
Market, Inc. at the cost of $ I per year. The trailer lease has expired and the company the lease
agreement was with no longer exists. Attempts to identify and locate an owner having a claim to
the trailer have not been successful. The trailer is designed as a temporary office facility. The
trailer has deteriorated creating a burden of repairs. Currently, the roofleaks, flooring is weak in
specific areas, ceiling tiles are discolored, walls are in need of painting, and the access ramp for
the physically challenged does not meet the American Disability Act specifications.
The proposed relocation will move the Area "B" office from 911 Kendall Drive to 941 Kendall
Drive Suite A&B. The new location complies with the site selection criteria as established in the
December 1987 study.
A lease agreement between the City and Stater Bros. Market, Inc. will provide the new location
at a cost of $1 per year, for a term of five years with an additional five-year option. Taking
advantage of this opportunity is more cost effective than making the necessary repairs to the
current location. In order to bring the current facility within compliance of state and municipal
codes, it will cost approximately $ 14,000. Making these repairs is only a temporary solution to
a continual problem of deterioration and will not improve the exterior appearance or utility of the
facility.
In contrast, the new location provides the necessary space for expansion and provides for the
professional image associated with the Police Department. The new location is of similar type
and appearance as the other area command offices, which will establish consistency throughout
the department. The selected location also provides a permanent location for a term of five to ten
years.
75-0264
'.
,
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FINANCIAL IMPACT: Anticipated expense associated with the relocation is a one-time cost
of $ 21,500 for tenant improvements. These funds are available through a modification of the
city's 1997/98 Citizens Option for Public Safety (COPS) plan, approved by Mayor Valles on
March 19, 1998. There is no significant change in the annual operating expense.
RECOMMENDATION: Adopt the Resolution authorizing the execution ofa lease agreement
with Stater Bros. Market, Inc. for the building space located at 941 Kendall Drive Suite A&B.
Said agreement will cost $1 per year for the five-year term with a five-year option. The building
space will become the Area "B" Police Community Service Office. A copy of the lease
agreement including Exhibits "D" and "E", and the original site plans, Exhibit A, B, C, and Cl,
will be maintained and filed at the Police Department, authorized per Senior Assistant City
Attorney Robert Simmons. The original lease agreement including Exhibits "D" and "E" will be
forwarded to the City Attorney for approval as to form and content and necessary action taken to
have the lease authorized and signed.
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RESOLUTION NO.
3
RESOLUTION OF THE CITY OF SAN BERNARDINO AUTHORIZING THE
EXECUTION OF AN AGREEMENT WITH STATER BROS. MARKETS, INC., FOR
THE LEASE OF GROUND SPACE FOR THE AREA "B" COMMUNITY SERVICE
OFFICE AND REPEALING RESOLUTION NO. 89-155, SECTION 2.
BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY
OF SAN BERNARDINO AS FOLLOWS:
SECTION 1. The Mayor of the City of San Bernardino is
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hereby authorized and directed to execute on behalf of said City
and agreement with STATER BROS. MARKETS, INC., to lease ground
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space for the Area liB" Police Community Service Office, a copy
of which is attached hereto marked Exhibit "A" and incorporated
herein by reference as though fully set forth at length.
SECTION 2. Resolution No. 89-155, Section 2, is hereby
repealed.
SECTION 3. This resolution is rescinded if the parties to
the agreement fail to execute it within sixty (60) days of the
passage of this resolution.
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RP:bl
03/31/98
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I HEREBY CERTIFY that the foregoing Resolution was duly
adopted by the Mayor and Common Council of the City of San
Bernardino at a
meeting thereof, held on the
day of
, 1998, by the following vote, to wit:
Council Members:
AYES
ESTRADA
LIEN
ARIAS
SCHNETZ
DEVLIN
ANDERSON
MILLER
NAYS
ABSTAIN
ABSENT
City Clerk
The foregoing Resolution is hereby approved this
day
of
, 1998.
Approved as to form
and legal content:
JAMES F. PENMAN,
City Attorney
By:
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Judith Valles, Mayor
City of San Bernardino
-2-
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LEASE AGREEMENT
BY AND BETWEEN
STATER BROS. MARKETS,
A CALIFORNIA CORPORATION
("LANDLORD")
AND
e
CITY OF SAN BERNARDINO
("TENANT"')
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DATED: M~12. 1998
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TABLE OF CONTENTS
BASIC LEASE PROVISIONS
1
Effective Date
Tenant
Tenant's Trade Name
Premises Address
Premises Size
Term
Fixturing Period Commencement
Fixed Minimum Rent
Rental Adjustment Date
Percentage Rate (for Percentage Rental)
Initial Estimated Common Area Expenses
Use of Premises
Security Deposit
Broker
Addresses for Notices
1
1
1
1
1
1
1
2
2
2
2
2
2
2
2
OPERATIVE PROVISIONS
2
ARTICLE 1
Premises
1.1 Leased Premises
1.2 Construction of Improvements
1.3 Fixturing Period
1.4 Tenanfs Acceptance of Premises
1.5 Rental Commencement Date
1.6 Changes
1.7 Relocation
2
2
3
3
3
3
3
3a
ARTICLE 2
Business Rights and Restrictions
2.1 Use
2.2 Environmental Restrictions
2.3 Use Restrictions
3
3
1
4
ARTICLE 3
Term
5
ARTICLE 4
Rent
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
5
5
5
5
5
6
6
6
7
Fixed Minimum Rent
Percentage Rent
Rental Adjustment
Late Payments
First Partial Month
Gross Sales
Records
Audit
e ARTICLE 5
Common Area 7
5.1 Definition 7
5.2 Use 7
5.3 Maintenance 7
5.4 Records 7
5.5 Tenant's Contribution 7
5.6 Operation and Control 8
5.7 Employee Parking 8
5.8 Obstruction 8
ARTICLE 6
Merchants Association 8
ARTICLE 7
Taxes 8
7.1 Personal Property Taxes 8
7.2 Real Property Taxes 9
ARTICLE 8
Utilities 9
e ARTICLE 9
Repairs and Alterations 9
9.1 Leasehold Improvements 9
9.2 Landlord's Repairs 10
9.3 Tenant's Repairs 10
9.4 Service Contracts 10
9.5 Alterations 10
ARTICLE 10
Insurance 11
10.1 Use, Rate 11
10.2 Liability Insurance 11
10.3 Worker's Compensation Insurance 11
10.4 Fire Insurance 11
10.5 Business Interruption Insurance 12
10.6 Waiver of Subrogation 12
10.7 General Requirements 12
10.8 Blanket Insurance 12
ARTICLE 11
Damage and Restoration 12
11.1 Duty to Restore 12
e 11.2 Election to Terminate 13
11.3 Rent Adjustment 13
ii
e ARTICLE 12
Eminent Domain 13
12.1 Definition 13
12.2 Total Taking 13
12.3 Partial Taking 13
12.4 Termination Date 13
12.5 Repair and Restoration 14
12.6 Rent Adjustment 14
12.7 Award 14
ARTICLE 13
Indemnity, Waiver 14
13.1 Indemnity 14
13.2 Waiver 14
ARTICLE 14
Operation of Business 14
ARTICLE 15
Signs, Fixtures, Restrictions Regarding Exterior 15
15.1 Fixtures 15
e 15.2 Signs 15
ARTICLE 16
Liens 15
ARTICLE 17
Right Of Access 16
ARTICLE 18
limitation on Liability 16
ARTICLE 19
Assignment and Subletting 16
19.1 Consent Required 16
19.2 General Conditions 16
ARTICLE 20
Notices 17
ARTICLE 21
e Surrender of Possession 17
21.1 Surrender 17
21.2 Holding Over 17
iii
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Quiet Enjoyment 17
ARTICLE 23
Subordination 17
ARTICLE 24
Offset Statement 18
ARTICLE 25
Default 18
25.1 Notice and Remedies 18
25.2 Tenant's Property 18
25.3 Notice of Termination 18
25.4 Waiver of Notice - Performance by Landlord 19
25.5 Interest 19
25.6 Other Remedies 19
ARTICLE 26
Insolvency 19
e 26.1 Breach of Lease 19
26.2 Operation of Law 19
26.3 Non-Waiver 19
ARTICLE 27
Remedies Cumulative 20
ARTICLE 28
Management of Shopping Center - Coliection Charge 20
ARTICLE 29
Attorneys' Fees 20
ARTICLE 30
Waiver of Default 20
ARTICLE 31
No Partnership 20
ARTICLE 32
e Subtenancies 20
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e ARTICLE 33
Successors 21
ARTICLE 34
Removal of Tenant's Property 21
ARTICLE 35
Effect of Conveyance 21
ARTICLE 36
Interpretation/Amendment 21
ARTICLE 37
Time of Essence 22
ARTICLE 38
Brokers 22
ARTICLE 39
e Corporate Resolutions 22
ARTICLE 40
Security Deposit 22
40.1 Deposits 22
40.2 Performance 22
ARTICLE 41
Option To Renew 23
Addendum To Lease Agreement 23a
TABLE OF EXHIBITS
Shopping Center
Site Plan
Landlord Improvement Specifications
Sign Criteria
Delivery Estoppel
"An
"B"
"C"
'D"
'E"
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SHOPPING CENTER SPACE LEASE
THIS LEASE (Lease") is entered into as of the date set forth below by and between STATER BROS.
MARKETS, a California corporation ('Landlord") and Tenant
RECITALS
This Lease is made and entered into with respect to the following facts:
A. Landlord is the owner of the Premises (as hereinafter defined), or is the Tenant of the
Premises pursuant to the terms of a Lease under which Landlord is entitled to Sublease
the Premises to Tenant.
B. Tenant desires to lease the Premises from Landlord.
C. Landlord is willing to make certain improvements to the Premises as per Exhibit "CO &
Exhibit "C-1" attached, and to lease the premises to Tenant upon the terms and
conditions hereinafter set forth.
NOW, THEREFORE, the Parties hereby agree as follows:
BASIC LEASE PROVISIONS
Effective Date: .................................................... March 12, 1998
Tenant: ............................................................... City of San Bemardino
Tenanfs Trade Name: ....................................... San Bemardino Police Department
Community Police Facility
Premises Address: ............................................. 941 Kendall Drive, Suites "A" & "B",
San Bemardino, CA 92407
County: ............................................................... San Bemardino
Premises Size: ................................................... Approximately 2,177 net rentable square feet, consisting of
approximately thirty-three feet eight inches (33' 8") of frontage
and approximately sixty-four teet eight inches (64' 8") of
depth.
Term: .................................................................. Sixty (60) months, computed from the first day of the first
calendar month on or after the Rental Commencement Date.
The Rental Commencement Date shall be fixed in a Delivery
Estoppel to be executed by Landlord and Tenant in the form
attached hereto as Exhibit "E".
(Calimesa, California)
_ixed Minimum Rent: ...........................................
~ ~S /II I Dollars per year, payable in equal monthly
installments of Zero (S /II I Dollars during the Term, subject
to adjustment pursuant to Section 4.3.
Rental Adjustment Date: ...................................... Not Applicable.
Percentage Rate (for Percentage Rental): .............. $ Zero Percent ( //l %).
Initial Estimated Common Area Expenses:.......... ~(S //l I per square foot of Premises Size per month,
subject to adjustment pursuant to Section 5.5.
Use Of Premises: ................................................. Community Police Facility.
The Premises shall be used solely for the use stated above
and for no other use or purpose.
Security Deposit: .................................................. Zero IS //l I
Broker:.................................................................. Not Applicable.
Addresses For Notices:
LANDLORD
TENANT
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STATER BROS. MARKETS
Attn: Vice President Real Estate
21700 Barton Road
(P.O. Box 150)
Colton, CA 92324-0150
CITY OF SAN BERNARDINO
Attention: Chief of Police
710 North "0" Street
San Bemardino, CA 92401
These Basic Lease Provisions are intended to supplement and/or summarize the provisions set forth in
the Operative Provisions of this Lease. If there is any conflict between any provisions contained in these Basic
Lease Provisions and the Operative Provisions of this Lease, the Operative Provisions of this Lease shall
control.
OPERATIVE PROVISIONS
ARTICLE 1
PREMISES
1.1 Leased Premises. Landlord hereby leases unto Tenant, and Tenant hereby leases from Landlord,
those certain Premises (consisting of land and buildings and improvements) located as set forth in the Basic
Lease Provisions (hereinafter referred to as the "Premises"). The Premises are outlined in red on Exhibit "B"
attached hereto and made a part hereof. The Premises are part of the shopping center (hereinafter referred to
as the "Shopping Center") described in EXHIBIT "A" attached hereto and made a part hereof. The Premises will
consist of approximately the number of square feet set forth in the Basic Lease Provisions.
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a 1.2 Construction of ImDrovements. Landlord shall improve the Premises io accordance wilh the plans and
. specifications described io EXHIBIT "C'L which is attached hereto and iocorporated hereio by this reference.
"5 Exhibit "C-l"
1.3 Fixturin2 Period.
improvement obligations (hereioafter referred to as the "Completion Date") at least the e orth io the
Basic Lease Provisions prior to the Completion Date (the "Fi' . encement"). After Landlord notifies
Tenant of tbe Completion Dale, and requirements of Section 9.5 of this Lease, Tenant shall have tbe
right to ente . purposes of equippiog and fixturiog the Premises, so long as sucb entry does not interfere
. In tbe eventtbat Tenant enters the Premises prior to tbe Rental Commencement
Date, as permitted by this paragrapb, all of the provisions of this Lease sball be io full force and effect except tbe rent
provisions.
1.4 Tenant's AcceDtance of Premises. Withio five (5) days after Landlord bas notified Tenant that the
improvements to the Premises have been substantially completed (whether or not Tenant is then in possession of the
Premises as permitted io paragraph 1.3), Tenant shall deliver to Landlord a list of items that Tenant deems necessary for
Landlord to complele or correct io order for the Premises to be acceptable. Landlord shall complete or correct each item
contaioed io the list delivered by Tenant to Landlord otber than those which Landlord may contest. If Tenant fails to
deliver the list to Landlord withio tbe five (5) day period described io this paragraph, Tenant shall be deemed to have
accepted tbe Premises as beiog io a good and tenantable condition and sball be deemed to have approved the construction
as baving been completed io a good and workmanlike fashion. In the event Tenant does deliver such list to Landlord
within the five (5) day period described in this paragraph, Tenant shall be deemed to have approved tbe construction as
baving been completed io a good and workmanlike fashion and shall be deemed to bave accepted the Premises as being in a
good and tenantable condition with respect to all matters except those described io the list.
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1.5 Rental Commencement Date. The Rental Commencement Date sball be fixed io a Delivery Estoppel to be
executed by Landlord and Tenant withio five (5) days after Landlord bas notified Tenant tbat the improvements to the
Premises bave been substantially completed (whether or not Tenant is tben io possession of the Premises as permitted io
paragrapb 1.3), and which shall be io tbe form attached bereto as Exhibit "E". In the event that Tenant fails to execute the
Delivery Estoppel, the Rental Commencement Date shall be deemed to be tbe date upon which Landlord notifies Tenant
that the improvements to the Premises have been substantially completed.
1.6 Chan2es. Landlord sball have tbe right, at any time, to change any or all of the following items so long as
tbe change does not substantially interfere witb the iogress to and egress from tbe Premises or the flow of vehicular traffic
in the Sbopping Center:
(a)
The location, io tbe Sboppiog Center, of tbe Building in whicb the Premises are located (but sucb change
sball not be made following the completion of the Premises).
(b)
The location, in the Sbopping Center, of the Premises (but such change shall not be made following the
completion of the Premises).
ARTICLE 2
BUSINESS RIGlITS AND RESTRICTIONS
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(c)
The plot plan of the Shoppiog Center.
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2.1 Use. Tenant shall bave the right to use tbe Premises for tbe use set forth in the Basic Lease Provisions. No
otber use of tbe Premises shall be permitted. Nothing contained herein sball be deemed to give Tenant any exclusive rigbt
to such use in the Sbopping Center. Tenant sball not use or occupy the Premises in violation of law or of the certificate of
occupancy issued for the Building, and shall, upon written notice from Landlord, discontinue any use of the Premises
which is declared by any governmental autbority baving jurisdiction to be a violation of law or of said certificate of
occupancy. Tenant sball comply with any direction of any governmental autbority having jurisdiction whicb shall, by
reason of the nature of Tenant's use or occupancy of the Premises, impose any duty upon Tenant or Landlord witb respect
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1.7 Relocation of Tenant. Landlord shall have the right at any time and from time to time, upon ninety
(90) days prior written notice to Tenant, to relocate Tenant to other Premises (the "Relocation Premises")
within the shop buildings, subject; however, to the following terms and conditions:
A. The Relocation Premises shall have approximately the same rentable square footage as
is contained in the Premises;
B. The Relocation Premises shall be leased to Tenant on the same terms and conditions
as provided in the Lease, except that if the rentable square footage in the Relocation
Premises is more or less than that contained in the Premises, there shall be a
proportionate adjustment of Base Rent, and Tenanfs share of the 'costs and expenses
of operating and maintaining the Center Common Facilities," based upon the rentable
square footage in the Relocation Premises;
C. Landlord shall pay to Tenant expenses reasonably incurred by Tenant in the physical
relocation of Tenanfs personal property, within thirty (30) days following receipt from
Tenant of an itemized list of said expenses and copies of all invoices with proof of
payment; and
D. Landlord and Tenant, during said ninety (90) days period, shall mutually agree in writing
upon;
e (I)
(ii)
(iii)
the scope and cost of all leasehold improvements to be constructed at the
Relocation Premises, which shall be substantially similar to those of the
original leased Premises, adjusted proportionately for size;
the extent of Landlord's contribution to the cost thereof, if any, and;
a timetable for their completion. Landlord and Tenant shall use best efforts
and act in good faith to agree on the terms. If Landlord and Tenant cannot so
agree, then in Landlord's reasonable discretion, Landlord may elect to either;
(a) submit the dispute to binding arbitration
for resolution, or
(b) upon written notice to Tenant within thirty
(30) days after the expiration of said
ninety (90) day period, to terminate this
Lease by thirty (30) days written notice.
E. If Landlord elects to exercise its right of relocation, Tenant will be given the choice of
spaces within the shopping center (See Exhibits "A" & "B" attached) that are available
for tenancy and of comparable size. Tenant's choices would not include spaces
occupied by other tenants or spaces on which a commitment had been made to another
party. Also, Tenant's choices would be limited to only already completed buildings.
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Page 3-a
eto the Premises or with respect to the use or occupation thereof. Tenant sball not do or permit to be done anything which
will invalidate or increase tbe cost of any fire, extended coverage or any otber insurance policy covering tbe Building
Complex andlor property located therein and shall comply with all rules, orders, regulations, recommendations and
requirements of tbe Pacific Fire Rating Bureau or any otber organization performing similar function. Tenant shall
promptly, upon demand, reimburse Landlord for any additional premium cbarged for sucb policy by reason of Tenant's
failure to comply with the provisions of this Article, but such reimbursement sball not be construed as curing Tenant's
default for failing to comply with tbe provisions of this Article. Tenant sball not do or permit anything to be done in or
about tbe Premises which will in any way obstruct or interfere with the rigbts of otber tenants or occupants of tbe
Shopping Center, or injure or annoy tbem, or use or allow the Premises to be used for any improper, immoral, unlawful or
objectionable purpose, nor shall Tenant cause, maintain or permit any nuisance in, on or abouttbe Premises. Tenant sball
not commit or suffer to be committed any waste in or upon tbe Premises.
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2.2 Environmental Restrictions. Tenant shall not engage in any activity on or about the Premises tbat violates
any Environmental Law, and shall promptly at Tenant's sole cost and expense, take all investigatory andlor remedial
action reasonably required by Landlord or ordered or required by any governmental agency or Environmental Law for
clean-up and removal of any contamination involving any Hazardous Material created, caused directly or indirectly or
materially contributed to by Tenant. The term "Environmental Law" shall mean any federal, state or local law, statute,
ordinance or regulation pertaining to health, industrial bygiene or the environmental conditions on, under or about the
Premises, including witbout limitation, (i) tbe Comprebensive Environmental Response, Compensation and Liability Act
of 1980. ("CERCLA "), 42 U.S.C. Sections 9601 et seq.; (ii) the Resource Conservation and Recovery Act of 1976
("RCRA"), 42 U.S.C. Sections 6901 et seq.; (iii) California Healtb and Safety Code Section 25100 et seq.; (iv) the Safe
Drinking Water and Toxic Enforcement Act of 1986, California Health and Safety Code Section 25249.5 et seq.; (v) the
Federal Water Pollution Control Act, 33 U.S.C. Sections 1151 et seq.; (vi) tbe Porter-Cologne Water Quality Control Act,
California Water Code Section 13000 et seq.; and (vii) California Civil Code Section 3479 et seq., as such laws are
amended and the regulations and administrative codes applicable thereto. The term "Hazardous Material" includes,
without limitation, any material or substance whicb is (a) defined or listed as a "bazardous waste", "extremely bazardous
waste", "restrictive hazardous waste" or "bazardous substance" or considered a waste, condition of pollution or nuisance
under the Environmental Laws; (b) petroleum or a petroleum product or fraction thereof; (c) asbestos; andlor
(d) substances known by the State of California to cause cancer andlor reproductive toxicity. It is the intent of the parties
hereto to construe the term "Hazardous Materials" and Environmental Laws" in its broadest sense. Tenant shall provide
all notices required pursuant to the Safe Drinking Water and Toxic Enforcement Act of 1986, California Health and Safety
Code Section 25249.5 et seq. Tenant sball provide prompt written notice to Landlord of the existence of Hazardous
Substances on tbe Premises and all notices of violation of tbe Environmental Laws received by Tenant. Tenant shall not
bring onto, create or dispose of, in or about the Premises or the Project, including but not limited to its sewage or storm
drain systems, any Hazardous Substances.
Notwithstanding the foregoing, Tenant may utilize the Premises for the storage of Hazardous Substances which
are reasonably and actually required in the normal operation of Tenant's business, so long as Landlord has not given
Tenant written notice prohibiting the storage or use of the specific Hazardous Substance in question, provided that Tenant
shall not store excess quantities of any Hazardous Substances in the Premises, and shall in no event store or warehouse
quantities of Hazardous Substances in the Premises in excess of that amount which would be consumed or sold by Tenant's
normal operations within sixty (60) days. All Hazardous Substances stored within the Premises sball be clearly labelled
and adequately safeguarded so as to avoid any spill or release of such Hazardous Substances.
2.3 Use Restrictions. Tenant sball not be permitted to: (i) conduct any auction or bankruptcy sale; (ii) conduct
any fire sale; (iii) conduct any closeout sale except at the expiration of tbe lease term; or, (iv) sell any so-alled "surplus",
"Army and Navy" or "secondband" goods as those terms are generally used at this time and from time to time bereinafter,
in, on or from tbe Premises.
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ARTICLE 3
TERM
& Exhibit "C-l"
I
The Term sball commence wben Landlord bas subslllntially completed construction of the Premises and the
Sbopping Center in whicb tbe Premises are located pursuant to the provisions of EXHIBIT "C" ,lor on tbe date upon which
Tenant bas first opened for business from the Premises, whicbever event occurs first. The parties sball immediately
execute a document in tbe form of Exhibit "E" to this Lease stating tbe date of commencement of the Term wben it bas
been ascertained. The Term sball be as set forth in the Basic Lease Provisions. In the event tbat Landlord is unable to
deliver possession of the Premises to Tenant within eigbteen (18) montbs following the execution of tbis Lease, this Lease
shall automatically terminate and be of no furtber force or effect. ~~
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4.1 Fixed Minimum Rent. Tenant sball pay a fixed minimum rent to Landlord at the address set forth for
notices to Landlord, or at sucb other address as may be specified by Landlord, without prior demand, deduction or setoff
during tbe term of this Lease. The fixed minimum rent sball be payable on or before the first day of eacb calendar montb
during tbe term in tbe amount set fortb in the Basic Lease Provisions.
ARTICLE 4
RENT
4.2 Percenta2e Rent.
at the time and in tbe manner berein specified as percentage rental bereunder a sum equivalent to the a any, by
which the percentage set fortb in tbe Basic Lease Provisions as tbe "Percentage Rent" of tbe r as defmed below)
in any montb exceeds the fixed minimum rent payable during the same month.
Within ten (10) days after the end of eacb calendar the term bereof, commencing witb the tenth (IOtb)
day of tbe month following the commencement 0 as bereinabove provided), and ending with the tenth (IOtb) day
of tbe montb next succeeding the last the lease term, Tenant sball furnisb to Landlord, at the place wbere rent is
tben required to be paid e terms bereof, a statement in writing, certified by a duly authorized officer or
representative 0 to be correct, sbowing tbe total gro.ss sales made in, upon or from the Premises during tbe
prec' endar month, and sball accompany each such statement witb a payment to Landlord equal to the percentage
. . .
4.3 Rental Adiu<tment.
date set forth in tbe Basic !..ease Provisions as tbe rental adjustment date, as follows:
The base for determining tbe adjustment sball be the Consumer Price rban Consumers, for the Los
Angeles-Anaheim-Riverside Area (1982-84 = 100) publisbed by the' tes Department of Labor, Bureau of Labor
Statistics (Index) whicb is publisbed for tbe calendar mo 3) months prior to the first full month of the lease term
(Beginning Index). If tbe Index publisbed ~ ontb whicb is three (3) montbs prior to the adjustment date (Extension
Index) bas increased over tbe . g Index, the fixed minimum rent for the following year (until the next rent
adjustment) sball multiplying the fixed minimum rent for tbe initial full month of the term by a fraction, the
nume w 'cb is tbe Extension Index and tbe denominator of whicb is the Beginning Index; provided, however, that
Index sball be converted in accordance with tbe conversion factor publisb s epartment of Labor,
Bureau of Labor Statistics. If tbe Index i urmg the term of this Lease, sucb otber government
index or It IS replaced sball be used in order to obtain subslllntially the same result as would have'
4.4 Late Payments. Tenant bereby acknowledges that late payment by Tenant to Landlord of rent and other sums
due bereunder will cause Landlord to incur costs not contemplated by this Lease, tbe exact amount of which will be
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_ extremely difficult to asceltain. Such costs include, but are not limited to, processing charges, accounting charges and late
. charges Ihat may be imposed on or incurred by Landlord. Accordingly, if any Installment of rent or any other sum due
from Tenant shall nol be received by Landlord or Landlord's designee within five (5) days after such amount shall be due,
Ihen wilhout any requirement for notice to Tenant, Tenant shall pay to Landlord a late charge equal to ten percent (109<)
of the amount which would otherwise be due. Addilionally, Tenanl sball pay to Landlord a charge of fifteen dollars
($15.00) for each check which is dishonored or returned by Tenant's bank for any reason. The parties hereby agree thai
such cbarges for late payments and for dishonored cbecks represent a fair and reasonable eslimate of the cost Landlord will
incur by reason of such occurrences. Acceptance of such cbarges shall in no event constitute a waiver of Tenanl's default
witb respecllo such overdue or dishonored amounts, nor prevenl Landlord from exercising any of its rigbts and remedies
granted hereunder.
4.5 First Partial Month. If the commencemenl date occurs on a day other Iban the firsl day of a calendar month:
(a) Fixed minimum rent for the partial month sball be prorated, based upon a Ihirty (30) day month, and as
so prorated shall be paid on the commencemenl date, in addition 10 the rental due for Ihe firsl full montb
of the lerm.
Lease, and the daily minimum rent provided in this
minimum rent paid for t s
a uct in addilion 10
in computing Ihe percentage rent payable for thai
.
4.6 Gross Sales.
(ii)
The gross amount received or cbarged by Tenant for merchan
pursuant to orders received by telepbone, mail, house-to-
allributable 10 the Premises wbetber or nol filled elsewbe ,and,
sold or services rendered
or by other canvasing, and
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(i) The entire amount cbarged for the full price al tbe time of tbe initial transact'
mercbandise sold or delivered or services rendered by Tenanl whetber or not s
actually received al the lime of sale;
(iii) All gross income of Tenant from any operatio " ai, from or through the use of Ihe Premis\\S,.
including, but nol limited to, sales made means of mechanical or olber vending machines
localed in, at or on Ibe Premises.
(b)
There sball be excluded from gross
;
or deducted Iberefrom if previously included:
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(i)
tt allowed on merchandise returned by customers.
(ii)
(c)
Tenant' as used in this paragraph includes tbe named Tenant and any agent, employee,
or concessionaire of the named Tenant, or any otber person or firm conducting business in, ai,
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4.7 Records.
concessionaires to keep and preserve, for a period of not less th!D three (3) years folio n 0 the original
lerm of this Lease or any extension Ihereof, complete, acourat r s of all amounts received during eacb
lease year in the Premises, inc1udin , cash register detail tapes. However, in Ihe case of a controversy
between t centage rent payable hereunder, Tenant sball keep and preserve said records until tbe
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bearing directly on Tenant's gross sales hereunder. In addi!" ord a copy of Tenant's
California State Sal ys 0 owing the date on which such return is filed with the Franchise
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4.8 Audit.
transacted in the Premises, whether or not included in "gross sales'. If the audit dis ements for the
period audited are inaccurate, adjustment shall be made imm . callon by Landlord. If the audit further
discloses that Tenant has understated n y two percent (2 %) or more, Tenant shall immediately pay the
cost of the a ogether with any amounts due Landlord as a result of such und~rstatement, whic.h amounts
ARTICLE 5
COMMON AREA
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5.1 Definition. The common area is that area within the Shopping Center which is neither occupied by buildings
(excluding roof overhangs and canopies, columns supporting roof overhangs and canopies, and subsurface foundations) nor
devoted permanently to the exclusive use of a particular Tenant, except that areas containing pylon signs and buildings or
structures which are used with respect to the operation of the common area shall be deemed to be part of the common area.
5.2 Use. During the lease term, Tenant, its concessionaires, licensees, invitees, agents, customers and employees
sball have the nonexclusive right to use the common area in common with Landlord, other owners of portions of the
Sbopping Center, other lessees, and tbeir respective concessionaires, licensees, invitees, agents, customers and employees,
subject to tbe provisions of this Lease. .'
5.3 Maintenance. Landlord shall be responsible for managing and maintaining all improvements on the common
area in good and sanitary order, condition and repair, including making replacement where necessary, and in compliance
with all governmental requirements, including, without limitation, (i) managing; (ii) cleaning and removing rubbish and
dirt; (iii) providing labor, payroll !.aXes, materials and supplies; (iv) providing all utility services utilized in connection
therewitb; (v) maintaining, repairing, replacing and providing reserves for replacement and remarking paved and unpaved
surfaces, curbs, directional and other signs, landscaping, lighting facilities, drainage and otber similar items;
(vi) providing casualty, public liability, property damage and otber insurance on tbe common area, (vii) providing tools,
macbinery and equipment used in connection with the above, (viii) paying all real property and personal property !.aXes and
assessmeots levied or imposed against the common area; and, (ix) paying any regulatory fee or surcharge or similar
imposition imposed by governmental requirements based upon or measured by (a) tbe number of parking spaces, (b) the
areas devoted to parking in the common area or (c) rents received by Landlord (excluding, however, any income tax
payable by Landlord OD its income generally). :D-.Jl_.J ~I.Al l_ __l:.1,.,d ._ _ _____ _0- - . c--- L r . I I
(;[1 , I1€IfRl flL J . f ,I 'j,J';L 'I I, II 11>.:, D'I.
5.4 Records.
These records sball, u n rease
ours at tbe offices of Landlord for
5.5 Tenant's Contribution.
fixed minimum rent to Landlord, Tenant's pro rata share of the amount of all expenses doseri graph 5.3.
Tenant's pro ratA share sball be equal to the ratio whicb Tenant's floor area bears to t r area in the Shopping
Center, whetber or not then occupied. Tenant's monthly payment 0 . s all be based upon equal monthly
installments which have been estimated in advance by Landlo articular calendar year. Landlord may, within sixty
(60) days after the end of such year, or as soon r as may be practical, prepare an accounting of the actual common
area expenses incurred during su , upon completion of any such accounting shall invoice Tenant, or allow as a
credit against the c rea installments next due, as the case may be, the difference between Tenant's share of the
actual ar:" expenses incurred during such year, and the amount actually paid by Tenant with respect to common
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e possible, to an amount equal 'to ~ne-twelfth (1/12) of the actual c 'pat y Landlord to be
encountered during the cu s are of common area expenses shall be the amount set forth in the
5.6 Oneration and Control. Landlord shall have general possession and control of the entire common area and
may, from time to time, adopt rules and regulations pertaining to the use thereof. Landlord shall, except as otheJWise
provided herein, operate and maintain the common area during the lease term. The manner in which the common area
shall be operated and maintained and the expenditures therefor shall be in Landlord's sole discretion. Landlord reserves
the right to appoint a substitute operator, including but not limited to, any Tenant in the Shopping Center, to carT)' out any
and all of Landlord's rights and duties with respect to the common area as provided in this Lease; and Landlord'DliY enter
into a contract either by a separate document or in a lease agreement with such operator on such terms and conditions and
for such period as Landlord shall deem appropriate; and, if Landlord does so, the substitute operator, rather tban
Landlord, shall be entitled to receive the management fee provided in paragraph 5.3. Except in the event that Tenant may,
in the future, be appointed common area operator for the Shopping Center, Tenant shall have neither voice nor control in
the operation and maintenance of either the common area or the Shopping Center as a whole, and shall, specifically, have
no control with respect to the identity or type of business operated by future tenants to be located within the Shopping
Center. Landlord specifically makes no representation with respect to the existence or continued operation of any business
or any other tenant within the Shopping Center.
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5.7 Emnlovee Parkin!!. Landlord may designate what part of the common area, if any, shall be used for
automobile parking by employees, lessees, occupants and licensees. No employee of any such lessee, occupant or licensee
shall use any part of the common area for parking except such area or areas as may be so designated. Landlord shall be
entitled to enforce this provision by requiring the payment by Tenant of such amount per automobile as may be determined
to be appropriate by Landlord from time to time for each day per automobile for each day automobile driven by an
employee of Tenant, Tenant's agent, occupant, concessionaire or licensee is found parked within the common area, but
outside of the specified area.
5.8 Obstruction. No fence, wall, structure, division, rail or obstruction shall be placed, kept, permitted or
maintained upon the common area or any part thereof by Tenant, nor shall the sale, display, advertising, promotion or
storage of merchandise or any business activities of any kind whatsoever be conducted therein without Landlord's prior
written consent; nor shall any penon use the common area for solicitations, demonstrations, or any other activities that
would interfere with the conduct of business in the Shopping Center or which might tend to crearte c' . disorder or
commotion. '....
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ARTICLE 6
l\1ERCHANTS ASSOCIATION
Center, Tenant shall join and maintain membership in good standing in such n at Landlord or
any of the otber tenants of the Shoppin Cen rm such a Merchants Association in the future, Tenant
shall su s a do all things reasonably necessary in order to aid the formation of such Merchants
ARTICLE 7
TAXES
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7.1 Personal Proneftv Taxes. Tenant shall pay, before delinquency, all license fees, public charges, property
taxes and assessments on the furniture, fixtures, equipment, inventory and other property owned or being used by Tenant
at any time situated on or installed in the Premises, together with all license fees, permit fees, assessments and other costs
levied, assessed or imposed by law or ordinance upon Tenant or upon the business operated by Tenant, and shall, upon
request, deliver proof of such payment to Landlord.
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7.2 Real Prooertv Taxes.
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any and all real property taxes and general or speci'al assessments and installments the 109 any
tax on rent which is substituted in whole or in part for real propert essments and any license
fee imposed by a local governmental body on the c . rent, and excluding federal and state
income taxes) whicb sball, during the levied or assessed against an or any portion of the
Premises or imposed on . Said real property taxes and assessments for tbe first and last lease
years be a , if necessary, be prorated and apportioned between Landlord and Tenant to
upon individual assessment valuations (or prorations) supplied by tbe County r other
regulatory agency. Said prorations sball be conclusive upon botb a s the parties otherwise
mutually agree in writing. In the absence of a prora . I by the County Assessor or other
regulatory agency or a written agree e parties, Tenant's sbare shall be detemUned by
multiplying the amount orth in tbe tax bill whicb includes the Premises by a fraction in
whicb the r IS tbe floor area of Tenant's Premises and tbe denominator is the floor area of all
cOlDlDencement of the term are cbanged so that a tax, assessment or excise on rents or uc tax,
cbarge, or assessment, bowever described, is levied or assessed against a direct substitution
in wbole or in part for any real property taxes, Tenant sball e oelinquency the substitute tax or
excise on rents, but only to the extent that it can lOed tbatthere bas been a substitution and, as a
result, Tenant bas been relieved fro yment of real property taxes tbat would otberwise have been
obligated to pay. T are of any tax or excise on rent pursuant to this paragrapb shall be
substanti me as, and as a substitute for, the payment of such real property taxes as provided in
.
and expense to contest the amount or legality of any said real property taxes ents on or
attributable to tbe Premises, including the rigbt to apply for tbe r ereof, provided, however,
Tenaet sball prosecute any sucb contest witb du ce and sball, fortbwith upon the final
determination tbereof, pay tbe amoun . real property taxes and assessments on or attributable to
tbe Premises as so det ogetber witb any interest, penalties, costs and charges which may be
payable' Ion therewitb. Prior to any sucb contest, Tenant sball post sucb security or take other
ARTICLE 8
UTILITIES
Tenant sball arrange for all connection and bookup of, and sball pay, before delinquency, all cbarges for water,
gas, heating, ventilation, air conditioning, electricity, power, telephone, I fl. ",,'in and other utility services used on
or serving the Premises during the lease term. Nothing contained in this Wse shall limit Landlord in any way from
granting or using easements on, across, over and under the Shopping Center for the purpose of providing utility services.
ARTICLE 9
REPAIRS AND ALTERATIONS
9.1 Leasehold Imnrovemenls. Tenant, at its sole cost and expense, shall be responsible for decorating and
providing any leasehold improvements which may be required by Tenant at the commencement of the term. Sucb
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_Ieasebold improvements sball be subject to the reasonable approval of Landlord, whicb approval sball be obtained in
writing prior to the commencement of any construction. In no event sball Tenant make any cbange to the exterior
appearance of the Premises, or any cbange to or openings in the structural portions of the Premises, including, but nllt
limited to, bearing walls, roof and foundation, nor any penetration of tbe roof, unless Tenant sball bave first delivered to
Landlord a complete engineering analysis of tbe effects of sucb cbanges to the Premises and sball bave received Landlord's
express written consent to sucb cbanges. Within fifteen (IS) days following tbe completion of any improvements, Tenant
sball deliver to Landlord a complete set of "as built" blueprints. Tenant's failure to obtain Landlord's written consent
prior to the commencement of any improvements sball be deemed to be a material breacb of this Lease.
9.2 Landlord's Renni~. Landlord sball, at its own expense, keep in good condition and repair tbe roof
(excluding ceilings), downspouts and rain gutters, foundations and structural portions of exterior bearing walls, but
excluding any glass, windows, doors, skyligbts or other openings contained tberein.
.
9.3 Tenant's Renai~. Except as expressly provided in paragrapb 9.2, Landlord sball not be obligated to make
repairs, replacements or additions of any kind wbatsoever upon the exterior or interior of tbe Premises. The Premises,
togetber witb any equipment, facilities or fixtures sball, at Tenant's sole expense, be kept, repaired, maintained, replaced
or added to at all times by Tenant in good order and in sanitary and safe condition and repair and in accordance witb all
governmental requirements and insurance requirements, specifically, including, but not limited to, all glass of the Premises
(including but not limited to exterior plate glass) and the beating, ventilating arid air conditioning system. Tenant sball be
expressly responsible for any maintenance or repairs required with respect to the utility lines, conduits or pipes serving the
Premises, wbetber or not located in or on the Premises. Notwithstanding anytbing to tbe contrary contained berein,
Landlord sball bave no obligation to repair any damage to tbe Premises caused by any negligent or intentional act 01'
omission of Tenant, and Tenant sball be solely responsible for any sucb required maintenance or repair, including but not
limited to leakage caused by tbe installation or maintenance of Tenant's equipment on tbe roof of tbe Premises. Tenant
bereby waives any rigbt to make repairs to the Premises at Landlord's expense, wbetber pursuant to Sections 1941 and
1942 of the California Civil Code or otberwise.
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9.4 Sen-ice Contracts. Landlord may, at Tenant's sole expense and at all times, keep in effect (i) a contract witb
an independent air conditioning contractor for the maintenance of the air conditioning, beating and ventilation systems
serving tbe Premises," ." . .
located on tbe Premises, togetber with any related equipment and ,er system located on tbe
Premises, and (iii a co or or e maintenance of any Landlord installed security system, ana'
. Sbould Landlord elect to contract for any or all of tbese
services Tenant sball promptly reimburse Landlord for tbe cost of sucb contracts, I.c 11 ',1. j" I" f ,I
.~ !;ft__ r-' I tlf t'l) r II. . " on receipt of Landlord's invoice for tbe same, wbicb invoice shall be
rendered by Landlord to Tenant not more often than monthly. Landlord sball bave tbe rigbt but not be obligated to
commence any of these above service contracts upon 30 days notice to Tenant and may at any time amend cbange or cancel
said contracts.
9.5 Alterations. Tenant sball not make any alterations to the Premises wbatsoever witbout Landlord's prior
written consent, whicb sball be granted or denied in accordance with the provisions of paragrapb 9.1. Any alterations
made by Tenant sball remain on and be surrendered with the Premises upon expiration or termination of this Lease, except
that Landlord may elect, within ninety (90) days before expiration of tbe term, or within ten (10) days after expiration or
tennination of tbe term, to require Tenant to remove alterations that Tenant bas made to tbe Premises. If Landlord so
elects, Tenant, at its sole cost, sball restore the Premises to a tenantable condition, reasonable wear and tear excepted,
before tbe last day of the term, or within thirty (30) days after notice of election is given, wbicbever is later. If Tenant
makes any alterations to the Premises as provided in this paragrapb, the alterations sball not be commenced until fifteen
(IS) days after Landlord bas received notice from Tenant stating the date the installation of tbe alterations is to commence
so tbat Landlord can post and record an appropriate notice of nonresponsibility.
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ARTICLE 10
INSURANCE
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10.1 Use. Rate. TeDant shall Dot carry any stock or goods or do anything in, OD or about the Premises which will
in any way increase insurance rates on the huilding in whicb the Premises are located. In DO event shall Tenant carry OD
any activities which would invalidate any insurance coverage thereoD.
TeDant shall pay on demand by Landlord any increase in insurance premiums that may be charged because of
Tenant's vacating or otherwise failing to occupy tbe Premises, but this provisioD shall DOt be deemed to limit iD any
respect Tenant's obligations under Article 14.
10.2 Liabilitv Insurance.
(a) Tenant shall, at its sole cost and expense and at all times during the term of this Lease, or any extension
thereof, maintain and carry for the joint benefit of Tenant and Landlord, bodily injury and property
damage liability insurance by tbe terms of whicb Tenant and Landlord sball be indenmified against
liability for any damage or injury to property or persoD (including death) occurring in, on or about the
Premises, or any part thereof, or arising from the use or occupancy thereof, or arising directly or
indirectly from any act or omissioD of Tenant, its employees, agents, concessioDaires, representatives,
assigns, guests or liceDsees. Said liability insurance sball be in an amount of DOt less than One Million
Dollars ($1,000,000.00) combined single limit, and Tenant shall maiDtaiD with Landlord at all times
during tbe term of this Lease a curreDtly effective certificate of insurance satisfactory to Landlord from
eacb insurance carrier providing such insurance coverage.
(b)
Landlord sball maintain a policy or policies of compreheDsive liability insurance issued by one or more
insurance carriers, insuring against liability for injury to or deatb of persoDs and loss of or damage to
property occurring in or OD the commOD area, except any portioD thereof subject to Tenant's exclusive
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togetber witb Tenant's 0 e pa' m connection witb any cl~i.!"
10.3 Worker's ComDensation Insurance.
in compliance witb a
r s ,a I lty msurance with minimum coverage of Five
10.4 Fire Insurance.
(a)
Landlord sball pay for and sball maintain in full force and effect during the term of this Lease a policy or
policies of insurance covering the buildiDgs located OD the Premises for the perils Dormally insured UDder
the California Standard Fire Insurance Policy with extended coverage, vandalism and malicious mischief,
and sprinkler leakage (if applicable) eDdorsements attacbed. The Landlord may maiDtain in lieu of the
extended coverage and vandalism and malicious mischief endorsemeDts, otber broad form or all-risk
endorsemeDts whicb may broadeD the perils insured against. In additioD, the Landlord may maintaiD
flood and earthquake insurance coverage in its sole discretioD. The property coverage shall be in an
amount equal to tbe full replacement cost (witbout deduction for depreciation) of tbe buildings insured.
The policy may contain tbe standard form lender's loss payable endorsement issued to the bolder or
bolders of a mortgage or deed of trust secured by the Premises. .
premiums incurred by Landlord for sucb insurance within ten (10) da s 0 enant of
Landlord's statement therefor. If sucb insurance cov m addition to Tenant's Premises,
Tenant's sbare of the premiums s D e premium allocation made by the insurance carrier
and, if the e sucb allocatioD, theD OD the basis whicb TeDant's floor area bears to the
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policies of insurance covering Tenant's stock in trade, trade fixtu other personal
property located in, on or about the Pre . e enant in connection with its business.
Such covera e . n s normally insured under the California Standard Fire Insurance Policy
10.5 Business InterruDtion Insurance.
full force and effect during the term of this Lease a policy of insurance in rent will be paid to
Landlord for a period of not less than nine mlses are destroyed or rendered inaccessible by a risk
insured a a' rd fire and extended coverage insurance, with vandalism and malicious mischief
10.6 Waiver of Subrol!ation. Each party ("insured") hereby waives its entire right of recovery against the other
party, the other party's officers, directors, agents, representatives, employees, successors and assigns with respect to any
loss or damage, including consequential loss or damage to the insured's property caused by or occasioned by any peril or
perils (including negligent acts and willful misconduct) covered by any policy or policies carried by the insured.
10.7 General Reauirements.
.(a) All policies of insurance required to be carried hereunder by Tenant shall be written by companies
satisfactory to Landlord and licensed to do business in the State of California.
(b) Each policy of public liability insurance required to be carried by Tenant shall be primary and
noncontributing with any insurance carried by the Landlord.
(c)
Each policy required to be carried by Tenant shall expressly include, severally and not collectively, as
additional named insured thereunder, Landlord and any person or firm designated by Landlord, as their
respective interests may appear.
(d) Each policy required to be carried by Tenant shall not be subject to cancellation or reduction in coverage,
including cancellation for nonpayment of premiums, except upon at least thirty (30) days prior written
notice to Landlord and each additional named insured. The policies of insurance required to be carried
by Tenant, or duly executed certificates evidencing them, together with satisfactory evidence of the'
payment of premiums thereon, shall be deposited with Landlord prior to the commencement of the term
or prior to Tenant's initial entry to the Premises for fixturing or other activity to be carried on prior to
the commencement of the term, whichever occurs first, and not less than thirty (30) days prior to the
expiration of the term of such coverage. If Tenant fails to comply with this requirement, Landlord may
obtain such insurance and keep it in effect, and Tenant shall pay to Landlord the premium cost thereof
upon demand with interest at the highest lawful rate from the date of payment by Landlord to the date of
repayment by Tenant.
10.8 Blanket Insurance. Landlord and, upon Landlord's written consent, Tenant, shall be entitled to fulfill its
insurance obligations hereunder by maintaining a so-alled "blanket" policy or policies of insurance in such form as to
provide by specific endorsement coverage not less than that which is required hereunder for the particular property or
interest referred to herein.
ARTICLE 11
DAMAGE AND RESTORATION
11.1 Dutv to Restore. If the improvements on the Premises or the Shopping Center are partially or totally
damaged by fire or other casualty so as to become partially or totally untenantable, which damage is insured against under
any policy of fire and extended coverage insurance then. covering the damaged improvements, this Lease shall not
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A.erminale and said improvements shall be rebuill by Landlord with due diligence al Landlord's expense unless Landlord
~Iects 10 lerminale this Lease as provided in paragraph 11.2.
11.2 Election to Tenninate. If either the improvements on the Premises or the Shopping Cenler as a whole, are
damaged by an insured casualty to the exlent of al leasl twenty. five percent (25 %) of their respective replacemenl cost
(COSIIO repair or replace al the time of loss wilhout deduction for physical depreciation) during Ihe term of lhis Lease other
Ihan during Ihe lasllhree (3) lease years of said lerm, or to Ihe exlenl of alleasl ten percent (10%) Ihereof during Ihe last
Ihree (3) years of said lerm, or 10 any exlenl by an uninsured cause al any lime during Ihe lease lerm, or by an insured or
uninsured cause during any exlension or renewal of Ihe lease lerm, Landlord shall, within nol more than ninely (90) days
after such damage, nOlify Tenanl of Landlord's eleclion 10 terminale this Lease or 10 reslore Ihe improvements on the
. Premises anll such portion of Ihe improvements in the balance of the Sbopping Cenler as in Landlord's sole discretion is
necessary 10 create an economically feasible commercial unit. If Landlord elects 10 repair or reslore lhe damaged
improvements, then with respecl to the Premises, Landlord and Tenant each shall restore them in the same manner and to
Ihe same exlent as work was done by each of them in the original conslruclion and fixlUrizing of the Premises, and lhe
damaged improvements in lbe balance of Ihe Sbopping Cenler shall likewise be reslored 10 Ihe extenl required in lhe
preceding senlence. If Landlord elects not 10 reslore, as aforesaid, this Lease shalllerminate effeclive as of Ibe date of
such damage upon Ihe giving of nolice of eleclion by Landlord as aforesaid. If Landlord elects 10 reslore or fails 10 give
notice of its election as aforesaid, then this Lease shall remain in full force and effecl.
.11.3 Rent Adiustment. If this Lease is nOllerminated as provided in this Article 11, Ihen during Ihe period of
repair and resloralion, if and only to the exlenl thaI Tenanl's paymenl obligalions under lhis Lease would nOI be covered
by rental interruplion or olher insurance required to be carried by Tenanl pursuanl to Ihe lerms of this Lease, Ihe fixed
minimum renl shan be abaled by thaI proportion which the floor area rendered unusable as a resull of such damage bears 10
Tenanl's total floor area before such damage. In no evenl, however, shall Tenanl's share of common area expenses be
abated unless Ihe common area expenses paid by each of the olher lenants located within the Sbopping Center are abaled by
Landlord.
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ARTICLE 12
EMINENT DOl\1AIN
12.1 Delinition. If there is any taking of or damage 10 all or any part of the Shopping Cenler or any inleresl
Iherein because of lhe exercise of the power of eminent domain or inverse condemnalion, whether by condemnation
proceedings or otherwise, or any transfer of any part thereof or any interesl therein made in avoidance or Ihreallhereof (an
of Ihe foregoing being hereinafter referred 10 as "taking") before or during the lerm hereof, the rights and obligations of
the parties with respect 10 such taking shall be as provided in lhis Article 12.
12.2 Total Takin2. If there is a taking of all of the Premises, this Lease shall lerminale as of Ihe date of such
taking.
12.3 Partial Takin2. If twenty-five percent (25 %) or more of the floor area of Tenant's Premises shall be taken,
either party shall be enlitled to terminate this Lease; or if twenty-five percent (25%) or more of the floor area of all
buildings in the Shopping Cenler shall be taken, whether Tenanl's Premises are taken or nol, Landlord (but nOI Tenant)
shall be enlilled to elect to lerminale this Lease; and the terminating party shall give the other party wrillen notice of such
eleclion nol laler than lhirty (30) days after Ihe date Landlord delivers nolice to Tenant lhal possession of title to Ihe
portion of the Premises taken has vested in Ihe condemnor. If neither party gives such notice or less Ihan twenty-five
percenl (25 %) of Ihe floor area of either Tenant's Premises or buildings in the Shopping Center shall be taken, lhis Lease
shall remain in full force and effecl and rent shall be adjusled as provided in paragraph 12.6.
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12.4 Tennination Date. If this Lease is terminated in accordance wilh Ihe provisions of this Article 12, such
lermination shall become effeclive as of the date physical possession of the condemned portion is taken by the condemning
aUlhority.
....<:1....,. l' "f"~
a 12.5 Renair and Restoration. If this Lease is nottermiDated as provided in this Article 12, Landlord may, at its
,., sole expeose, restore with due diligence the remainder of the improvements occupied by Tenant so far as practicable to a
complete unit of like quality, character and condition as that which existed immediately prior to the taking, provided that
the scope of the work shall not exceed the scope of the work to be done by Landlord originally in constructing the
Premises, and further provided that Landlord shall not be obligated to expend an amount greater than tbat whicb was
awarded to Landlord for such taking.
12.6 Rent Adiustment. If this Lease is not termiDated as provided in this Article 12, and until such time as
Landlord may restore the Premises pursuant to this Article 12, the fixed minimum rent shall be adjusted by that proportion
which the floor area taken from the Premises bears to Tenant's total floor area immediately before tbe taking. In no event,
bowever, sball Tenant's sbare of common area expenses be abated unless the common area expenses paid by eacb of tbe
other tenants located within the Shopping Center are abated hy Landlord.
12.7 A ward. Tbe entire award or compensation in sucb proceeding, wbetber for a total or partial taking or for
diminution in the value nf the leasehold or for the fee shall belong to and be the property of Landlord, provided that
Tenant sball be entitled to recover from the condemnor such compensation as may be separately awarded by the condemnor
to Tenant or recoverable from the condemnor by Tenant in its own rigbt for tbe taking of trade fixtures and equipment
owned by Tenant (meaning personal property, wbether or not attached to real property, whicb may be removed without
injury to the Premises) and for the expense of removing and relocating sucb personal property.
ARTICLE 13
INDEMNITY, W AlVER
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13.1 Indemnitv. Tenant shall defend, indemnify and shall save and hold Landlord harmless from and against
any and all liens, claims, demands, actions, causes of action, obligations, penalties, charges, liability, damages, loss, cost
or expeose, including reasonable attorneys' fees for the defense thereof, arising from or connected with (a) the conduct or
management of the business conducted by Tenant on the Premises or any portion of the common area whicb is under the
exclusive control of Tenant (tbe Premises and such portion of tbe common area which is under tbe exclusive control of
Tenant being referred to as "Lessee's Premises" for purposes of this Article 13,) or (b) the use or occupancy of Tenant's
Premises, or from any breach or default on the part of Tenant in the performance of any covenant or agreement on tbe part
of Tenant to be performed pursuant to the terms of this Lease, or (c) from violations of or noncompliance with any
governmental requirements or insurance requirements, or (d) from any acts or omissions (including, but not limited to,
negligence or willful misconduct) of Tenant or any invitee, guest, agent, patron, license, vender, concessionaire or
employee.
13.2 Waiver. All property kept, stored or maintained on Tenant's Premises shall be SO kept, stored or
maintained at the sole risk of Tenant. Landlord shall not be liable and Tenant waives all claims against Landlord for
damages to persons or property sustained by Tenant or by any other person or firm resulting from the building in wbicb
the Premises are located or by reason of Tenant's Premises or any equipment located thereon becoming out of repair, or
through the acts or omissions of any persons present in the Sbopping Ce~ter or renting or occupying any part of the
Sbopping Center, or for loss or damage resulting to Tenant or its property from burst, stopped or leaking sewers, pipes,
conduits or plumbing fixtures, or for interruption of any utility services, or from any failure of or defect in any electric
line, circuit or facility or any other type of improvement or service on or furnisbed to Tenant's Premi~ it ~Iting from
any accident in, on or about Tenant's Premises or the building in which the Premises are located. ( '\
ARTICLE 14
OPERATION OF BUSINESS
Ij'nTiM !-i~;,::':
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normal operating bours of similar businesses, but at 1
ad uatel mp oyees to handle the
elg t ) hours a day; (ii)
maximum business and carry sufficient stock of
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(iv) keep the Premises and exterior and interior portions of
windows, doors and all other glass or plate glass fixtures in a neat, clean, sanitary and safe condition; too) ..,..~.t..^''''.. rf""~i
If ~.-iflt 1r8l1r (Ln. .iFii"lI..1in !Wi ';tlliRt ..tn.lis 18 aire, fir sail It filf.1ilJ (vi) use for office or other non-selling purposes
only such space as is reasonably required for Tenant's business; (vii) refrain from burning any papers or refuse of any
kind, or otherwise creating any noxious or offensive odors or fumes, in the Sbopping Center; (viii) store in the area
designated by Landlord all trash and garbage in neat and clean containers so as not to be visible to members of tbe public
shopping in the Shopping CeDtetl"~ 1H"11Il1' flf sIl. IJUlar ,illrur Adj . uti-A I If JtllA t ..k 1 11 l 0- 1 T .'-
__p......... ..... __-FA_I. :- .1.._ "'_1"_)"___' -f ... I_A\.. r--.......I -j'.-.......... ..I-~:F..,_..1 ""r ,__..11.......1 :& , __..11__.:1 d.... it
~.....:_l..1.. .,.. 1....ua ..11 ........... _..._....:..,.. ____.._..a L.r --... "''''-'-''''':'TII (ix) observe and pr~mptly comply witb all governmental
requirements and insurance requirements affecting the Premises or any part of the common area which is under Tenant's
exclusive control and promulgated during the term of this Lease; (x) not use the Premises or suffer or permit the Premises
or any part thereof to be used in any manner that will constitute a nuisance or unreasonable annoyance to tbe public, to
other occupants of the Shopping Center or to the Landlord, or that will injure the reputation of the Shopping Center, or for
any extra bazardous purpose, or in any manner that will impair the structural strengtb of tbe building of which the
Premises are a part; and, (xi) keep sidewalks adjacent to the Premises clean and free from visible trash, papers, oil, gum
and other debris. Tenant covenants and agrees not to install, use or to allow to be installed or used, upon the described
Premises, any gaming machines or devices without the prior written consent of Landlord, including, but not limited to,
video game machines.
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SIGNS, F1XTURES, ~~C;;~;:ONS RE EXTERIOR ~
15.1 Fixtures. All fixtures installed by Tenant sball be new or completely reconditioned. Tenant sball not make
e or cause to be made any alterations, additions or improvements to the building, or install or erect or cause to be installed
or erected any signs (including, but not limited to, exterior signs, window signs and signs painted on doors or windows),
floor covering, exterior ligbting, plumbing, fixtures, sbades or awnings, radio or television antenna, satellite dish or
similar devices, or make any cbanges to the store front or exterior of the building, nor shall tenant install any loud
speakers, sound amplifiers or similar devices which would be beard in adjoining suites or outside Tenant's Premises
without first obtaining Landlord's written approval and consent. Tenant sball present to Landlord plans and specifications
for such work attbe time approval is sougbt.
15.2 Si2JlS Tenant will not place or suffer to be placed or maintained on any exterior door, wall or window of the
Premises any sign, awning or canopy, or advertising matter or other thing of any kind and will not place or maintain any
decoration, lettering or advertising matter on the glass of any window or door of the Premises, or install any sign or
advertising material within 18 inches of a window (or in any location if installed in such a manner as to be primarily
visible form the exterior of the Premises) without first obtaining Landlord's wrillen approval and consent. Tenant further
agrees to maintain such sign, awning, canopy, decoration, lellering, advertising mailer or otber thing as may be approved
in good condition and repair at all times. Tenant sball not place or suffer to be placed any merchandise, equipment or
other items outside the building on the Premises. *
ARTICLE 16
LIENS
Tenant shall keep tbe Premises and the Shopping Center free of any liens or claims of lien arising from any work
performed, material furnished or obligations incurred by Tenant in connection with tbe Premises. If Tenant disputes the
correctness or validity of any claim of lien, Tenant shall, within ten (10) clays after written request by Landlord, record
sucb bond as will release said property from the lien claimed. Tenant sball defend, indemnify and hold Landlord harmless
from and against any all cost or expense, including but not limited to attorneys' fees. arising out of any lien or claim of
lien on the Premises.
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*Se.t: Ab~t:N~U~) PA-lif: ),3 a. ) PA-lUr~f,)," 6':
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ARTICLE 17
RIGHf OF ACCESS
Landlord aDd its authorized agents aDd representatives shall be entitled to enter the Premises at all reasonable
times for the purposes of: (i) inspecting them; (H) making repairs which Landlord is ohligated to make under this Lease;
(Hi) curing a default of TenaDt; (iv) posting aDY notice permitted by law that would relieve Landlord from responsibility
for the acts or omissions of TenaDt; (v) exhibiting the Premises to prospective buyers, lessees or lenders; aDd, (vi) posting
ordinary signs advertising the Premises for sale or for lease during the last one hundred eighty (180) days of the term or
any extended term hereof.
ARTICLE 18
LIMITATION ON LIABILITY
In consideration of the benefits accruing hereunder, TenaDt aDd all successors aDd assigns covenant aDd agree that,
in the event of aDY actual or alleged failure, breach or default hereunder by Landlord:
(a) TenaDt's sole aDd exclusive remedy shall be against Landlord's interest in the Shopping Center.
(b)
No partner, master lessor, officer, agent or employee of Landlord shall be sued or named as a party in
aDY suit or action, or served with process, or required to answer or otherwise plead to any service of
process, nor will any judgment be taken against any partner, master lessor, officer, agent or employee of
Landlord. Any judgment taken against any partner, master lessor, officer, agent or employee of
Landlord may be vacated and set aside at any time nunc pro tunc, and no writ of execution will ever be
levied against the assets of any partner, master lessor, officer, agent or employee of Landlord.
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(c) The covenants aDd agreements contained within this Article 18 shall inure to the benefit of and shall be
enforceable by both Landlord and any partner, master lessor, officer, agent or employee of Landlord.
ARTICLE 19
ASSIGNMENT AND SUBLETIING
19.1 Consent Reouired. Notwithstanding anything to the contrary contained herein, TenaDt shall not assign this
Lease or any interest herein, or sublet, license, grant any concession or otherwise give permission to anyone olher than
TenaDt to use or occupy all or any part of the Premises without the prior written consent of Landlord. The sale,
assignment, transfer or disposition, whether for value, by operation of law, gift, will or intestacy of (i) twenty-five percent
(25 %) or more of the issued and outstanding stock of Tenant if Tenant is a corporation; or, (ii) the interest of any general
partner, joint veniure, association or co-tenancy shall be deemed an assignment of this Lease under this paragraph.
Landlord and/or Landlord's agent shall be entitled to an application fee of Five Hundred Dollars (5500.00) be paid at the
time of application for approval of any assignment or subletting as a condition precedent to the processing of any such
request for Landlord's consent. Such fee is a processing fee only, however, and shall in no way obligate Landlord to
consent to the requested assignment or sublease.
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19.2 General Conditions. In the event of any assignment of this Lease, Tenant shall remain primarily liable
under this Lease. Such liability shall continue tbroughoutthe remaining term of this Lease, including any renewal terms,
notwithstanding any subsequent or further assignment of this Lease, whether or not Tenant has consented to or approved
such assignment. Nor shall such liability be extinguished or reduced by any later amendment or modification of this
Lease, whether or not Tenant approves or consents to such amendment or modification. In the event of any assignment or
sublease, the assignee or sublessee shall agree in writing to perform and to be bound by all of the covenants of this Lease
required to be performed by Tenant. Landlord's approval of one assignment or subletting by Tenant of its inlerest in this
Lease shall not be deemed to be an approval of any further assignment or subletting.
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ARTICLE 20
NOTICES
Whenever under this Lease provision is made for notice or demand, it shall he in writing and signed by or on
behalf of the party giving the notice or making the demand and served by personal delivery, registered or certified mail or
by telegraph. If served by registered or certified mail, it shall he deposited in the United States mail, postage prepaid,
with return receipt requested, addressed to the party to whom such notice of demand is to he given at the address stated in
the Basic Lease Provisions, as the case may he, and shall he conclusively deemed served on the date indicated on the return
receipt and if the receipt is not returned, then fortyeight (48) hours after mailing. If served by telegraph, service to tbe
addressee shall he conclusively deemed made as confirmed by the telegraphic agency making delivery. If served by
personal delivery, service shall he deemed made as of actual delivery. The address of either party may be changed for the
purpose ofthis paragraph by written notice to the other party.
ARTICLE 21
SURRENDER OF POSSESSION
21.1 Surrender. At the expiration or other termination of this Lease, whether by lapse of time or otherwise,
Tenant shall surrender the Premises as of such date broom clean and in good condition and repair, reasonable wear and tear
excepted.
21.2 Holding Over.
(a)
If Tenant holds over after the expiration of the term hereof with the express consent of wdlord, such
holding over shall, in the absence of a written agreement he deemed to have created a tenancy from
month-to-month, terminable on thirty (30) days written notice by either party to the other, at a fixed
minimum rental equal to two hundred percent (200%) of the fixed minimum rental in effect immediately
prior to the expiration of the term, and at a percentage rental equal to two hundred percent (200%) of the
percentage rental in effect immediately prior to the expiration of the term, and otherwise subject to all
terms of this Lease. Nothing contained in this paragraph shall he construed as consent to such holding
over by wdlord,
(b) If Tenant fails to surrender the demised premises upon the termination of this Lease, Tenant shall defend,
indemnify and shall hold Landlord free and harmless from loss or liability resulting from such failure,
including, without limitation, the generality of the foregoing, any claims made by any succeeding tenant
arising out of such failure to surrender the Premises.
ARTICLE 22
QUIET ENJOYMENT
Subject to the provisions of this Lease and conditioned upon performance of all of the provisions to he performed
by Tenant hereunder, Landlord shall secure to Teoant during the lease term the quiet and peaceful possession of the
Premises and all rights and privileges appertaining thereto.
ARTICLE 23
SUBORDINATION
Tenant agrees that this Lease, at Landlord's option, shall he subordinate to: (a) any first and junior mortgages or
first and junior trust deeds that may hereafter he placed upon the Premises and to any advances to he made thereunder, any
interest thereon and all renewals, replacements and extensions thereof, provided that such mortgagees or beneficiaries first
request such subordination and thereafter agree in writing to recognize this Lease in the event of foreclosure if Tenant is
.... r....
eot in default, (b) OJJ.Y so-alled sale and leaseback of the Shopping Center by Landlord, and (c) any: (i) parking lot
agreement, (ii) common area maintenance agreement, (iii) declaration of covenants, conditions and restrictions, or
(iv) similar agreement affecting the overall operation of the Shopping Center or its parking or common area (the general
category of documents described in this sub-section (c) being referred to as "CC&R's"), together with any fuNre
amendment or modification to any CC&R's. Tenant shaJl, within five (5) days following written request from Landlord,
execute and deliver, without cost to Landlord, whatever instruments may be required to effect such subordination.
ARTICLE 24
OFFSET STATEMENT
TenOJJ.t sball, at any time and from time to time within five (5) days after wrillen request therefor by Landlord,
deliver witbout cost to Landlord a certificate to Landlord or to any proposed mortgagee, trust deed beneficiary; purcbaser
or successor in interest, certifying the commencement and expiration date of tbe lease term and tbatthis Lease is then in
fuJl force and effect and selling forth the amount and naNre of the modifications, defenses or offsets, if any, claimed by
Tenant, together with sucb other information as may be reasonably requested by Landlord. If Tenant fails to deliver such
certificate within said five (5) day period, Tenant herehy appoints Landlord as Tenant's allorney-in-fact for the purpose of
completing, executing and delivering the certificate to the person or firm requesting it.
ARTICLE 25
DEFAULT
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25.1 Notice and Remedies. 10 the event of Tenant's failure to pay rent or to perform any of Tenant's other
obligations under this Lease, or any part hereof, when due or caJled for hereunder, Tenant sbaJl bave a period of five (S)
days after service of wrillen notice by Landlord specifying the nature of Tenant's default within whicb to cure such
defaults, provided that if the naNre of a non-monetary default is sucb that it cannot be fully cured within said five (5) day
period, Tenant sball bave such additional time as may be reasonably necessary to cure such default so long as Tenant
proceeds promptly after service of Landlord's notice and proceeds diligently at aJltimes to complete said cure; provided,
however, that any such notice shaJl be in lieu of, and not an addition to, any notice required under the provision in Section
1161 of the California Code of Civil Procedure regarding unlawful detainer action. If Tenant fails to comply witb the
foregoing provisions, Tenant shall be deemed to be in breacb of this Lease and Landlord, with or witbout further notice or
demand of any kind, may, at its option:
(a) Terminate Tenant's rigbtto possession of the Premises because of sucb breach and recover from Tenant
all damages aJlowed under Section 1951.2 of the California Civil Code, including, witboutlimitation, the
wortb at the time of the award of the amount by whicb tbe unpaid rent for the balance of tbe term after
the time of award exceeds the amount of sucb rental loss for the same period that Tenant proves could be
reasonably avoided; or,
(b) Not terminate Tenant's rigbtto possession because of sucb breach, but continue this Lease in full force
and effect and, in sucb event, Landlord may enforce aJl rigbts and remedies under this Lease including
the right to recover the rent and aJl other charges due bereunder as such rent and other charges become
due hereunder or to relet the Premises.
25.2 Tenant's Pronertv. 10 the event of default, aJl of Tenant's property shaJl remain on the Premises and in
that event, and continuing during the length of said default, Landlord shall have the right to appoint a receiver to take the
exclusive possession of Tenant's property and to use it rent or charge free until aJl defaults are cured, or, at Landlord's
option, to remove any such property and place such property in storage in a public warehouse at the cost and risk of
Tenant.
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25.3 Notice of Tennination. No re-entry or reletting of the Premises sbaJl be construed as an election by
Landlord to terminate Tenant's right to possession and this Lease unless a written notice of such intention is given by
Landlord to Tenant and, notwithstanding any such relelling without such termination, Landlord may, at any time
e tbereafter, elect to terminate Tenant's rigbt to possession and this Lease in the eventtbat at sucb time Tenant remains in
default bereunder.
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25.4 Waiver of Notice _ Perfonnance bv Landlord. Notwithstanding any provision of this Article 25, if,
(i) Tenant fails to comply with any governmental requirement, Tenant sban not be entitled to notice of default from
Landlord or any rigbt to cure beyond the period within which such compliance may be required by such governmental
requirement; (ii) if this Lease expressly provides that this Lease may be terminated effective on service of notice, Tenant
shan be entitled to cure its default only if the right to cure is required by law; or, (iii) if, in Landlord's judgment, the
. continuance of any default by Tenant for the full period of notice provided for herein win jeopardize the Premises or tbe
rights of Landlord, Landlord may, with or without notice, elect to perform those acts in respect to which Tenant is in
default for the account and at the expense of Tenant. If by reason of such default by Tenant, Landlord is cnmpened to pay
or elects to pay any sum of money, including, but not limited to, reasonable attorneys' fees, such sum or sums so paid by
Landlord, with interest thereon from the date of such payment at the rate provided in paragrapb 25.5, sban be due from
Tenant to Landlord on demand.
25.5 Interest. Any amount due to Landlord not paid when due shan bear interest at the maximum rate allowed
by law from the date due. Payment of such interest shan not excuse or cure any default by Tenant under this Lease.
25.6 Other Remedies. Nothing contained herein shan limit Landlord to the remedies set forth in this Article 25
and, particularly, those whicb are set forth in paragraph 25.1, and upon Tenant's default, Landlord shan be entitled to
exercise any right or remedy then provided by law, including, without limitation, the right to obtain injunctive relief and
tbe right to recover all damages caused by Tenant's default in the performance of any of its obligations under this Lease.
Tenant, along with an other remedies afforded herein, shan share the right to any and an other remedies at law or in
equity. All remedies shan be distinct, separate and cumulative, none being to tbe exclusion of the otber.
ARTICLE 26
INSOLVENCY
26.1 Breach of Lease. The filing of any petition by or against Tenant under any cbapter of the Bankroptcy Act,
or any successor statute thereto, or the adjudication of Tenant as a bankn1pt or insolvent, or the appointment of a receiver
or trustee to take possession of an or substantially an of the assets of Tenant, or a general assignment by Tenant for the
benefit of its creditors, or any other action taken or suffered by Tenant under any state or federal insolvency or bankroptcy
act, shall constitute a default under and breach of this Lease by Tenant, regardless of Tenant's compliance with tbe other
provisions of this Lease, and Landlord, at its option and by written notice to Tenant, may exercise all of the rights and
remedies provided for in Article 25, including the termination of this Lease, effective on the service of such notice,
witbout the necessity of furtber notice under Article 25.
26.2 Oneration of Law. Neither this Lease nor any interest berein, nor any estate created hereby, shan pass by
operation of law under any state or federal insolvency or bankn1ptcy act to any trustee, receiver, assignee for the benefit of
creditors or any other person whatsoever witbout the prior written consent of Landlord. Any purported transfer in
violation of the provisions of this paragraph sball constitute a default under and breach of this Lease, regardless of
Tenant's compliance with the other provisions of this Lease, and Landlord, at its option and by written notice to Tenant,
may exercise all of the rights and remedies provided for in Article 25, including the termination of this Lease, effective on
the service of such notice without the necessity of further notice as provided under Article 25.
26.3 Non-Waiver. The acceptance of rent at any time and from time to time by Landlord from Tenant as debtor
in possession or from a transferee of the type mentioned in paragraph 26.2, shan not preclude Landlord from exercising its
rights under this Article 26 at any time thereafter.
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ARTICLE 27
REMEDIES CUMULATIVE
The various rights, elections and remedies of Landlord and Tenant contained in this Lease shall be cumulative and
no one of them shall be construed as exclusive of any of the others, or of any right, priority or remedy allowed or provided
for by law.
ARTICLE 28
MANAGEMENT OF SHOPPING CENTER - COLLECTION CHARGE
Landlord may, at any time, engage a manager to operate the Shopping Center on Landlord's
event, Tenant shall pay to Landlord, within ten (10) days after d . , ut not more often than
monthly, Tenant's ro e ee c arged by such manager (which administrative fee shall not in
In addition, Tenant shall pay to Landlord a
collection charge of Seventy Five Dollars ($75.00) for preparation of each demand for delinquent re~other sums
which may be due under this Lease. \
. A~~~~,2~ES ,,,:;,AL Hle')
____~...i>
If either party to this Lease brings any action or files any proceeding against the other party arising out of this
Lease or for the declaration or interpretation of any rights hereunder, the prevailing party therein shall be entitled to
recover from the other party all costs and expenses, including reasonable attorneys' fees, incurred by the prevailing party
as determined by the court. If either party ("secondary party") without its fault is made a party to litigation instituted by
or against the other party ("primary party"), the primary party shall pay to the secondary party all costs and expenses,
including reasonable attorneys' fees and any judgment rendered, incurred by the secondary party in connection therewith.
ARTICLE 30
WAIVER OF DEFAULT
The waiver by either party of any default in the performance by the other of any covenant contained herein shall
not be construed to be a waiver of any preceding or subsequent default of tbe same or any other covenant contained herein.
The subsequent acceptance of rent or other sums hereunder by Landlord shall not be deemed a waiver of any preceding
default other than the failure of Tenant to pay the particular rental or other sum or portion thereof so accepted, regardless
of Landlord's kn()wledge of such preceding default at the time of acceptance of such rent or other sum.
ARTICLE 31
NO PARTNERSHIP
Landlord is not and shall not be deemed to be in any way or for any purpose an agent, employer, principal,
partner, joint venturer or member of any joint enterprise with Tenant.
ARTICLE 32
SUBTENANCIES
The voluntary or other surrender of this Lease by Tenant or a mutual cancellation of this Lease shall not effect a
merger and shall, at Landlord's option, terminate all existing subtenancies or operate as an assignment to Landlord of any
or ail of such subtenancies.
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ARTICLE 33
SUCCESSORS
Subject to the restrictions on assignment or subletting contained berein, this Lease shall be binding upon and shall
inure to the benefit of the parties hereto and their successors. The term "successors" is used herein in its broadest possible
meaning and includes, but is not limited to, every person succeeding to any interest in this Lease or to the Premises of
Landlord or Tenant herein, whether such succession results from the act or omission of such party. Each covenant and
condition of this Lease sball be binding upon all assignees, agents, subtenants, licensees and concessionaires of Tenant.
ARTICLE 34
REMOVAL OF TENANf'S PROPERTY
Upon tbe expiration of tbe term of this Lease or upon any earlier termination bereof, Tenant sball immediately
remove, at its own expense, all trade fixtures, equipment, mercbandise and personal property (collectively called "Lessee's
property") whicb were installed by Tenant or any sublessee, concessionaire or licensee in or upon the Premises; but, if
Tenant is in default, Tenant sball not remove Tenant's property unless notified by Landlord to do so. In case of any injury
or damage to the building or any portion of tbe Premises resulting from the removal of Tenant's property, Tenant sball
promptly pay to Landlord tbe cost of repairing sucb injury or damage. In tbe event Tenant sbould fail 10 complete sucb
removal promptly, Landlord may remove any or all items of Tenant's property from tbe Premises and dispose of Ibem in
any manner consistenl witb law and Tenant sball pay upon demand to Landlord the actual expense of sucb removal and
disposition together witb interest at tbe rate prescribed in paragrapb 25.5 from the date of payment by Landlord until
repayment by Tenant.
ARTICLE 35
EFFECT OF CONVEYANCE
If, during tbe term of this Lease, Landlord conveys its interest in the Premises, or lhis Lease, tben from and after
tbe effective date of sucb conveyance, Landlord sball be released and discbarged from any and all furtber obligations and
responsibilities under this Lease, including, but not limited to, tbose relating to any security deposit beld by Landlord,
except those already accrued of whicb Landlord bas notice at the time of conveyance.
ARTICLE 36
INTERPRET ATION/ AMENDMENT
The captions by whicb tbe Articles and paragraphs of this Lease are identified are for convenience only and sball
not affect the inlerpretation of this Lease. Wherever tbe context so requires, tbe singular number sball include tbe plural,
tbe plural shall include the singular, the neuter gender sball include tbe masculine and the feminine genders. If tbere is
more tban one signatory bereto as Tenant, the liability of sucb signatories shall be joint and several. If any provision of
this Lease sball be beld to be invalid by a court, tbe remaining provisions sball remain in full force and effect and sball in
no way be impaired thereby. It is understood lbat tbere are no oral agreements between the parties bereto affecting tbis
Lease or any Addenda attacbed bereto, and this Lease (togetber witb any Addenda attacbed bereto) supersedes and cancels
any and all previous negotiations, agreements, brocbures, agreements and understandings, if any, between Ibe parties
bereto or displayed by Landlord to Tenant witb respect to the Premises described berein, and no sucb extraneous or
ancillary material sball be used to interpret or construe tbe terms of this Lease. There sball be no modification or
amendment of this Lease except as may be executed in writing by eacb of tbe parties bereto.
- - - ..... - ('..,...
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ARTICLE 37
TIME OF ESSENCE
Time is of the essence of each provision of this Lease. All provisions relating to time shall he strictly construed.
ARTICLE 38
BROKERS
Landlord represents that it has utilized no hroker with respect to the arrangement, negotiation or execution of this
Lease, except as may be set forth in the Basic Lease Provisions. Tenant agrees to defend, indemnify and hold Landlord
hannless from and against any cost, claim or damage incurred hy Landlord as a result of any claim by any broker or other
person seeking a commission, finder's fee or similar payment with respect to the arrangement, negotiation or execution of
this Lease, other than as may be payable to the broker (if any) set forth in the Basic Lease Provisions.
ARTICLE 39
CORPORATE RESOLUTIONS
If a corporation executes this Lease as a tenant, Tenant shall promptly furnish Landlord certified corporate
resolutions attesting to the authority of the officers executing this Lease on behalf of such corporation.
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ARTICLE 40
SECURITY DEPOSIT
40.1 DeDosits. Tenant has deposited with Landlord the sum set forth in the Basic Lease Provisions as the
Security Deposit to be retained with Landlord as security for the faithful performance by Tenant of all of the terms,
covenants and conditions of this Lease by Tenant to be kept and performed, which deposit shall be increased from time to
time as the Minimum Annual rental increases, so as to maintain at all times during the term the same ratio between the
Security Deposit and the Minimum Annual Rental as exists at the commencement of the term. In the event that Tenant is
not then in default, any unused portion of the security deposit shall be returned to Tenant within fourteen (14) days
following the expiration of this Lease. In no event shall Landlord be obligated to pay interest on such security deposit.
Landlord may commingle such funds with other funds of Landlord. The taking of such security by Landlord shall in no
way be a bar or defense to any action in unlawful detainer or for the recovery of the Premises or for any other action which
Landlord may, at any time, institute for the breach of any term, covenant or condition contained herein.
40.2 Performance. In the event of failure of Tenant to keep and perform any of the terms, covenants and
conditions of this Lease to be kept and performed by Tenant during the term of this Lease, or any renewals or extensions
thereof, then Landlord, at its option, may appropriate and apply said entire deposit, or so much thereof as may be
necessary to compensate Landlord for loss or damage sustained or suffered by Landlord due to such breach on the part of
Tenant. Should the entire deposit, or any portion thereof, be appropriated and applied by Landlord for the payment of
overdue rent or other sums due and payable by Tenant to Landlord hereunder, then Tenant shall, upon the written demand
of Landlord, forthwith remit to Landlord sufficient current funds to restore said security to the original sum deposited, and
Tenant's failure to do so within five (5) days after receipt of such demand shall constitute a material breach of this Lease.
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ARTICLE 41
OPTION TO RENEW
Tenant is hereby granted the option to extend the term of this Lease for ONE I 1 I FIVE I 5 I
year period(s), hereinafter referred to as the 'Extended Term(s)", by giving notice of exercise of the option
('Option Notice") to Landlord at least three (3) months, but not more than one (1) year, before the expiration of
the Basic Term, or the then current Extended Term, as the case may be; provided, however, that if Tenant is in
default on the date of giving any such Option Notice, the Option Notice shall be totally ineffective, and provided
further, that if Tenant is in default on the date that the Extended Term would otherwise commence, such
Extended Term shall not commence and this Lease shall expire at the end of the then current term. Tenant shall
have no other right to extend the term beyond the last extended Term described herein. During the Extended
Term(s) all of the terms and provisions contained herein shall apply except that commencing at the beginning of
each Extended Term, the Annual Basic Rent shall be increased to an amount set forth in the Renewal
Addendum attached hereto, or if no such addendum is attached, the Minimum Annual Rental shall continue to
increase in accordance with the provisions of Section 4.3 of this Lease.
IN WITNESS WHEREOF, the parties have executed this Lease to be effective as of the date set forth in
the Basic Lease Provisions.
LANDLORD:
STATER BROS. MARKETS,
a California corporation
By:
WALTER F. FORD
Vice President Real Estate
TENANT:
CITY OF SAN BERNARDINO
APPROVED AS TO FORM AND LEGAL CONTENT
JAMES F. PENMAN
?~
By:
JUDITH VALLES
Mayor
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Page 23 of 23
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ADDENDUM TO LEASE AGREEMENT
BETWEEN STATER BROS. MARKETS (LANDLORD) AND
CITY OF SAN BERNARDINO (TENANT)
DATED: MARCH 12, 1998
LANDLORD AND TENANT ACKNOWLEDGE THAT:
A. Tenant shall continue to occupy the beginning approximately two thousand one hundred seventy-seven (2,177)
square feet until such time as Stater Bros. at its sole discretion, upon ninety (90) days written notice, shall require
Tenantto reUnquish the approximately eight feet two inches by fifty-seven feet nine inches (8' 2" x 57' 9") portion
of Tenant's premises indicated on Exhibit "C". Said Exhibit "C" is a part of this Lease. Tenants beginning
approximately two thousand one hundred seventy-seven (2,177) square feet is defined as Tenant's temporary
premises. Should Stater Bros. require Tenant to relinquish that approximately eight feet two inches by fifty-seven
feet nine inches (8'2" x 57' 9") portion of Tenant's temporary premises indicated on Exhibit "c" then, in that
event, the remaining approximately one thousand seven hundred and five (/,705) square feet is defmed as Tenant's
future premises.
Stater Bros. shall arrange for and pay all cost of the future demising wall, including the insulation of wallboard,
tape, sanded, and ready for finish on Tenant's side of wall; and the relocation of any lighting fIXtures, together
with modification of circuits to Tenant's panel. Stater Bros. shall modify the building systems (water, gas, and
electricity) so that Tenant's future premises retains the same individually metered utilities that serviced it prior to
the division. Tenant shall allow Stater Bros. reasonable access to the Premises for the purpose of said
construction. Tenant shall be responsible for interior modifications within its remaining future premises.
eB.
Landlord approves and consents to Tenant placing on Tenant's entry glass door and/or glass store front a replica
of the San Bernardino City Seal and a replica of the City of San Bernardino Police Department badge, provided
that, each replica is less than four feet (4 J high nor more than two feet (2 J wide.
C.
Tenant is currently occupying a trailer. The location of said trailer is indicated on Exhibits "A" and "B" as "Police
Station". Exhibits "A" and "B" are a part of this Lease Agreement. Within thirty (30) days of Landlord notifying
Tenant that the improvements to the premises (located at 941 Kendall Drive, Suites "A" and "B", San
Bernardino, California) have been substantially completed, Tenant will remove said trailer from the Shandin Hills
Shopping Center depicted on Exhibits "A" and "B". Further, Tenant will "cap" the utilities servicing said trailer
below the ground grade level and clear the site at Tenant's expense.
LANDLORD:
TENANT:
STATER BROS. MARKETS,
a California Corporation
CITY OF SAN BERNARDINO
Approved As To Form and Legal Content
James F. Penman
WALTER F. FORD
Vice President Real Estate
By: ~~ 7. (~
(J CITY ATTORNEY
By:
By:
JUDITH VALLES
Mayor
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23a
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SHANDIN HILLS
SIGN CRITERIA
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EXHIBIT "D"
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Introduction
This manual has been prepared as a guide for design and installation of Tenant
signing within the Shandin Hills project. The Specifications Indicated within this
manual are intended to help each Tenant achieve visual identification.
Tenant agrees to design, construct and install Tenant's signage at Tenant's sole
cost and expense in accordance with these Sign Criteria, as set forth below, prior
to Tenant opening for business in the Center. Conformance to detailed sign drawings
and specifications which have obtained the prior approval of the Landlord and the
City of San Bernardino will be strictly enforced and any nonconforming sign must be
brought into conformance at the sole expense of the Tenant erecting the same. The
Landlord shall administer and Interpret these Sign Criteria. These Criteria shall
apply equally to all Tenants of in line shop buildings.
General Requirements - All Tenants
1. Each Tenant shall submit to the Landlord for approval before fabrication, not
less than four (4) copies of detailed drawings indicating"the location, size,
layout, design, materials and color graphics. Such drawings shall be .
submitted concurrently with sufficient "architectural drawings to show the
exact relationship with the store design, and their store location onsite and
the dimensions of the lease frontage. .
2.
Prior to fabrication, detailed drawings of all signs shall be submitted to the
City of San Bernardino Planning Division for review and approval. These
drawings must be signed, stamped and approved by the Landlord prior to
submittal to the City.
3." Each Tenant shall obtain and pay the entire cost of all permits, approvals,
construction, installation and maintenance of its respective sign.
4. Each Tenant shall be responsible for the fulfillment of all of these Sign
Criteria.
5. No Tenant shall affix or maintain upon "any glass or other material on the
storefront any signs or advertisement unless they shall first have received
the prior written approval of the Landlord, other than the signs shown on the
following pages of this manual.
General Specification - Primary SiRns
1. All primary Tenant signs are to be individual channel lette.s and all letters
shall be constructed of 22 gauge Paint~lok sheet metal with automotive enamel
finish. Rohm and Hass Plexiglass shall be used for internally illuminated
letter faces.
2.
All sign bolts, fastenings and clips shall be hot-dipped galvanized iron,
stainless steel, aluminum, brass or bronze, and no black iron materials of any
type will be permitted. Angle clips attached to the letter sides will not be
permitted.
3. Painted lettering will not be permitted" except as noted.
4. No animated, flashing or audible signs will be permitted.
1
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6.
7.
8.
9.
10.
11.
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No sign cabinets or sign boxes will be permitted.
No exposed illuminated tubing or lamps will be permitted.
No exposed raceways, crossovers, conduit, conductors or transformers will be
permitted.
No manufacturer's or approval agencies' labels exposed to public view will be
permitted.
No. pylon or free-standing signs will be permitted except for center
identification sign as shown on Exhibit "A".
All signs shall bear the UL label, and their installation shall comply with
all local building and electrical codes.
Electrical service to all signs shall be on the respective Tenant's electrical
system.
12. Location of all openings in Tenant's storefront for conduit and sleeves shall
be shown on the drawings submitted to the Landlord for approval and the
installation shall conform with the approved dra~ings.
13.
14.
Each Tenant or its Sign Contractor shall be responsible for the repair of any
damage to the building caused by the installation of.said Tenant's sign.
Each Tenant shall be responsible for the performance of its Sign Contractor.
15. Individual shop address numerals will be installed by the Landlord.
16.. No temporary signs of any nature will be accepted without prior written
approval by.Land10rd.
17. Logo cabinets used in conjunction with individual letters will be considered
on an individual basis and will be considered a part of the sign.
18. Tenants shall display their established trade names only. The trade ~ame may
be used only one time per. permitted sign location. No additional advertising
will be permitted, 1. e. "Discount Sales", "Quality Shoes", "Mens Wear", etc..
or miscellaneous brand names included in their operation.
19. Tenant shall be responsible for removal of his sign upon exiration of the term
for any extension thereof. Removal of the sign shall include the repair of
the wall surface back to it's original condition.
20. No signs will be permitted on any awnings whatsoever.
DesiRn Specification - Primary SiRns
1.
Each Tenant will be permitted on (1) primary sign" with the exception that a
Tenant fronting on street and parking lots will be permitted one (1) sign on
each front.
2. Signs located outside or partially outsiae Tenant's demised premises will not
be permitted whatsoever.
3. Signs shall be of the following size:
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A. The square footage per Tenant sign will be limited to 15 sq. ft. per 20
linear foot of storefront to a maxiumum of 150 square feet of total sign
area on Building A, B, C, and D. No sign may be located closer than 2'-0"
to a corner or lease line.
B. Signs are to be installed per the location shown on the attached :elevation
Exhibit "D".
C. Maximum letter height allowed is 18".
D. Signs shall be individual letters, not to exceed a depth of 5".
4. Sign colors are optional, subject to approval.
5. Logo cabinets used in conjunction with individual letters will be considered
on a individual basis and will be considered a part of the sign.
6. Tenants shall display their established trade names only. No additional
advertising will be permitted, 1. e., "Discount Sales", "Quality Shoes", Mens
Wear", etc. or miscellaneous brand names included in their operation.
Secondary Tenant SiKns
Secondary signs will be at Tenant's option. If the Tenant chooses to utilize a
secondary sign he may choose from three (3) basic wood shapes which shall be hung
from a wall bracket, on the storefront, near the main entry to the Tenants lease
space. The sign shall be of sandblasted wood (no interior illumination) and limited
to one (1) per Tenant.
Minimum 8 '-0" clearance to underside of sign.
These signs will be subject to. Landlord's approval in writing abrication and Tenant
will be responsible for the sign's permit, construction, and hanging.
Business Hour Graphics
If Tenant chooses to display business hours, these hours must appear as gold mylar
on glass on the window surface with a maximum height of 1". ;
In most cases, the panel of glass adjacent to the right-hand side of the door
opening, will be utilized. All copy shall be flush left, 1" from side of window
mullion and bottom of window mullion.
Miscellaneous SiKn Criteria
1. No advertising placards, banners, pennants, insignias or trademarks, or other
descriptive material shall be affixed or maintained upon the storefront or in
show window space less than 24" from the face of the glass with the exception
of:
A. Banners which publicize special events (such as "Grand Opening" or
"Inventory Sale") will be allowed, subject to prior written approval by
the Landlord and subject to the time limits and permit requirements of
the City of San Bernardino and the Landlord.
B. Promotional sales signs painted on 100 lb. card stock which can cover a
3
"
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maximum of fifteen percent (15Z) of glass area excluding the entry doors,
subject to prior written approval by the Landlord.
2.
If Tenant has a noncustomed door for receiving merchandise, it should
Tenant I s address in 2" vinyl die-cut letter, Helvetica Medium Style.
letters to be selected by Project Architect. Where more than one (1)
uses the same door, each address shall be applied.
have
Color of
Tenant
3. Retail store numbering will comply with requirements of this criteria per
"Exhibit "G".
4. Building address signs shall be per the City of San Bernardino.
5. The standard signing for the supermarket on Parcell, the drug store on Parcel
2, and the tenant of building "Major 3" are hereby approved. National or
regionally recognized tenants occupying buildings E, F, G or H, shall be
allowed to install their standard signage program, subject only to the
approval of Stater and the City of San Bernardino.
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EXHIBIT "E"
DELIVERY ESTOPPEL
COMMENCEMENT AND TERMINATION DATE OF LEASE
AND LESSEE'S OBLIGATION
Pursuant to the terms and conditions contained in this Lease:
I. The Commencement Date of the term of the Lease is, or shall be deemed to be
2. The date upon which rent shall commence is
3. The date upon which the term of this Lease shall expire is
4. The date upon which Tenant received the keys to the Premises is
DATED this _ day of
.199_.
LANDLORD:
STATER BROS. MARKETS,
a California corporation
By:
WALTERF.FORD
Vice President. Real Estate
TENANT:
CITY OF SAN BERJIARDIlfO
APPROVED AS TO FORM ill LEGAL COlVTElfT
JAMES F. PENMAB
.~
City Attorney
By:
JUDITH VALLES
Mayor
Exhibit ftE" - Page 1 of I
..
C I T Y 0 F SAN B ERN A R DIN 0
INTEROFFICE MEMORANDUM
CITY CLERK'S OFFICE
DATE: April 24, 1998
TO: Chief Lee Dean, Police Department
FROM: Rachel Clark, City Clerk
SUBJECT: Transmittal for signatures and return to City Clerk for
filing with Resolution 98-99 authorizing the execution of
an agreement with Stater Bros. Markets, Inc., for the
lease of ground space for Area "B"
Attached are the following:
One (1) original agreement and three (3) duplicate original
agreements to be filed with Res. No. 98-99 authorizing the
execution of an agreement with Stater Bros. Markets, Inc., for the
lease of ground space for the Area "B" Community Service Office and
repealing Resolution No. 89-155, Section 2.
Please obtain
agreement to
resolution.
necessary signatures and return the original
the City Clerk's office for filing with said
Please be advised that said resolution was adopted on April 20,
1998, and will be rescinded if parties fail to execute said
documents within sixty (60) of the passage of this resolution. The
documents must be executed and returned no later than Friday,
June 19, 1998.
If you have any questions, please do not hesitate to call Eileen
Gomez at 5102. Thank you.
Rachel Clark
City Clerk
I hereby V:dge re~t
Signed:--~<: ____=__
~
Dated: - . . I<?
By:
of the above mentioned documents.
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