HomeMy WebLinkAbout25- Police Department CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION
From: Lee Dean,Chief of Police Subject: Resolution of the Mayor and
Common Council of the City of San
Dept: Police Department Bernardino authorizing the execution of an
agreement with Steward Development to lease
Date: January-20,2000 certain real property for the Area D'
ORIF Community Service Office and repealing
UINAL Resolution No. 91-268.
Synopsis of Previous Council Action
May 8, 1991-Resolution No. 91-268 authorizing the execution of an agreement with the Smart and
Final Shopping Center to lease certain real property to be used as a Police Community Service
Office for Area D'.
Recommended Motion:
1. Adopt Resolution.
2. Authorize the Director of Finance to amend the FY 19P8/ 9 CO Option Grant budget as
outlined in the staff report.
WAYNE ,ASgSTANT CHIEF OF POLICE
Contact person: Lt.Jenifer Aragon Phone: 384-5692
Supporting data attached: Yes Ward: Second
FUNDING REQUIREMENTS: Amount:
$1 per year x 5 years = $5 in lease payments Acct. 001-213-5181
$25,000 Tenant improvements Acct. 123-529-5505
Acct.Description: 1998/99 COPS Option Grant/Renovation of
'D'COP
Council Notes: Finan
Agenda Item No. a5
6AA7/�00
i
CITY OF SAN BERNARDINO— REQUEST FOR COUNCIL ACTION
Staff Report
SUBJECT: Approval of Resolution for the Relocation of Area"D" Community Service Office.
BACKGROUND: We currently have an opportunity to relocate the Area "D" 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 "D" 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, and a location within the area command that is
convenient to the public.
Currently, the Area "D" Community Service Office is located at 334 W. Baseline Street in a
leased office at the cost of$1 per year. The lease has expired. The building has deteriorated and
the walls are in need of painting. The roof leaks when it rains with the water running down the
east wall of the office, and creeping across the carpet. The acoustic ceiling tiles are discolored
and rats can be heard scurrying about. The exterminator has done what he can to arrest this
problem; however, the ceiling tiles are again ruined soon after their replacement. The "D" Area
Community Service Office staff has grown to include two Area Detectives, a Crime Prevention
Specialist, and the Distressed Neighborhood Grant Team, which increased the number of
j personnel by twelve. The size of the current office is inadequate to provide efficient working
space for this number of employees.
Mr. James Sharer(Facilities Management) and EDA, made inquiries about a suitable location for
relocation along the Baseline Corridor. None were available. An inquiry was made about
expanding the current location however the property manager did not respond.
Members of the Baseline Area Business Association (BABA) were contacted for suggestions.
The only suggestion given was the abandoned Obershaw Toyota property on `E' Street south of
Baseline. When contacted, Mr. Obershaw said that because of the costs he incurs for that
property he could not afford to provide it for police use.
I
The proposed relocation will move the Area "D" office from 334 W. Baseline Street to 711 W.
2"d St #A. The new location complies with the site selection criteria as established in the
December 1987 study.
A lease agreement between the City and Steward Development will provide the new location at a
cost of$1 per year, for a term of five years with an additional five-year option. The new location
provides the necessary space for expansion and provides for the professional image associated
with the Police Department. The new location is of similar type and appearance as the other area
command offices, which will establish consistency throughout the department. The selected
location also provides a permanent location for a term of five to ten years.
FINANCIAL IMPACT: A one-time cost of$ 25,000 is required for tenant improvements. The
improvements will include removing walls and doors between existing interview rooms to create
offices and a break room, paint, wallpaper, telephone and computer lines, and an exterior sign.
The funding source is the fiscal year 1998-1999 COPS Option Grant. All originally approved
items have been ordered or purchased and savings are available in various line items within the
grant for this cost. A budget amendment is required to transfer the following amounts to 123-
529-5505 (Professional/Contractual):
$15,000 123-529-5112 (Small Tools and Equipment)
7,400 123-529-5702 (Computer Equipment)
2.600 123-529-5701 (Motor Vehicles)
$25,000
There is no significant change in the annual operating expense.
RECOMMENDATION:
1. Adopt the resolution.
2. Authorize the Director of Finance to amend the FY 1998/99 COPS Option Grant budget as
outlined in the staff report.
i�
i
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I 1 RESOLUTION NO. 2000-
2 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
3 SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AGREEMENT
WITH STEWARD DEVELOPMENT TO LEASE CERTAIN REAL PROPERTY FOR
4 THE AREA 'D' COMMUNITY SERVICE OFFICE AND REPEALING
RESOLUTION NO. 91-268.
5
6 BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO AS FOLLOWS:
7
8 SECTION 1. The Mayor of the City of San Bernardino is hereby authorized and directed
9 to execute on behalf of said city an agreement with Steward Development to lease space for
10 the Area 'D' Police Community Service Office, a copy of which is attached hereto and
11 marked Exhibit 'A' and incorporated herein by reference as thoughtfully set forth at length.
12
13 SECTION 2. Resolution No. 91-268 is hereby repealed.
14
15 SECTION 3. This resolution is rescinded if the parties to the agreement fail to execute it
16 within sixty(60)days of the passage of this resolution.
17
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25
26
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1 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AGREEMENT
2 WITH STEWARD DEVELOPMENT TO LEASE CERTAIN REAL PROPERTY FOR
3 THE AREA 'D' COMMUNITY SERVICE OFFICE AND REPEALING
RESOLUTION NO. 91-268.
4
I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor and
5
6 Common Council of the City of San Bernardino at a joint regular meeting thereof,held on the
7 day of 2000 by the following vote, to wit:
8 Council Members Aves Nays Abstain Absent
9 ESTRADA
10 LIEN
11 McGINNIS
12
SCHNETZ
13
14 SUAREZ
15 ANDERSON
16 MILLER
17
18 City Clerk
19
The foregoing ordinance is hereby approved this day of 2000.
20
21 Judith Valles, Mayor
22 City of San Bernardino
Approved as to form
23 and legal content:
24 JAMES F. E
City A
25
26 By. i
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28
LEASE AGREEMENT
BY AND BETWEEN
ALLAN STEWARD, INC.
104 EAST STATE STREET
REDLANDS, CA 92373
1909 ) 335-0333
( "LANDLORD" )
AND
CITY OF SAN BERNARDINO
SAN BERNARDINO POLICE
DEPARTMENT
CHEIF OF POLICE
710 NORTH "D" STREET
SAN BERNARPINO,CA 92401
( "TENANT" )
i
TABLE OF CONTENTS
BASIC LEASE PROVISION 1
Effective Date 1
Tenant 1
Tenant's Trade Name 1
Premises Address 1
Premises Size 1
Term 1
Fixturing Period Commencement 1
Fixed Minimum Rent 2
Rental Adjustment Date 2
Percentage Rate porPercentage RwW 2
Initial Estimated Common Area Expenses 2
Use of Premises 2
Security Deposit 2
Broker 2
Addresses for Notices 2
OPERATNE PROVISIONS 2
ARTICLE 1
Premises 2
11 Leased Premises 2
1.2 Construction of Improvements 3
1.3 Foduring Period 3
1.4 Tenant's Acceptance of Premises 3
1.5 Rental Commencement Date 3
1.6 Changes 3
1.7 Relocation 3a
ARTICLE 2
Business Rlghts and Restrictions 3
2.1 Use 3
2.2 Environmental Restrictions
2.3 Use Restrictions
ARTICLE 3
Tenn 5
ARTICLE 4
Rent 5
4.1 Fixed Minimum Rent 5
4.2 Percentage Rent 5
4.3 Rental Adlusbr*nt 5
4.4 Late Payments 5
4.5 First Partial Month °
4.6 Gross Sales
4.7 Records — °
4.8 Audit 7
I
Common Area 7
5.1 Oeflnition 7
5.2 Use 7
5.3 Maintenance 7
5.4 Records 7
5.5 Tenant's Contribution 7
5,6 Operation and Control °
5.7 Employee Par$dng °
5.8 Obstruction
ARTICLE 6
Merchants Assoclation °
ARTICLE 7
Taxes
71 Personal Property Taxes
7.2 Real Property Taxes 9
ARTICLE 8
Utlikles 9
ARTICLE 9
Repairs and AMeratlons 9
9.1 Leasehold Improvements 9
92 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 Insu 11
10.3 Workers Compensation Insurance 11
10.4 Fire Insurance 11
10.5 Business Interruption Insuran 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 ResEDro 12
11.2 Election to Terminate 13
11.3 RentAdjustmertt 13
0
ARTICLE 22
Quiet Enjoyment
17
ARTICLE 23
Subordination 17
ARTICLE 24
Offset Statement 18
ARTICLE 25
Default 18
25.1 Notice and Remedies 18
25:2 TenanPs Property 18
25.3 Notice of Temrination 18
25.4 Waiver of Notice-Performance by Landlord 19
25.5 Interest 19
25.6 Other Remedies 19
ARTICLE 26
Insolvency 19
26.1 Breach of Lease 19
26.2 Operation of Law t9
26.3 Non-Waiver 19
ARTICLE 27
Remedies Cumulative 20
ARTICLE 28
Management of Shopping Center-Collection Charge 20
ARTICLE 29
Attomeys' Fees 20
ARTICLE 30
Waiver of Default 20
ARTICLE 31
No Partnership 20
ARTICLE 32
Subtenancies 20
ARTICLE 33
Successor 21
ARTICLE 34
Removal of Tenant's Property 21
ARTICLE M
Effect of Conveyance 21
ARTICLE 36
Interpr9tatlon/Amendmerd 21
ARTICLE 37
Time of 22
ARTICLE 38
Broken 22
ARTICLE 39
Corporate Resolutions 22
ARTICLE 40
Security Deposit 22
40.1 Deposits 22
40.2 Performance 22
ARTICLE 41
Option To Remy 23
Addendum To Lease Agreement 23a
TABLE OF EXHIBITS
Shopping Center .A.
Site Plan
Landlord Improvement SpecMks"
Sign Criteria V
Delivery Estoppel
992
Y
SHOPPING CENTER SPACE LEASE
THIS LEASE ('Leese) is entered Into ea of the date set forth below by and between ALLAN STEWARD,
INC,a Califomla corporation ('Landlord') and Tenant.
REMALS
Thla Lease is made and entered into with rupeettadhe following facts:
A. Landlord is the owner of the Premises (ea hereinafter defined), or is the Tenant of the
Premises pursuant to the terms of a Leali under which Landlord is entitled to Sublease
the Premises to Tenant.
B. Tenant desires to lease the Promises:fr4m•Landlord.
I
NOW, THEREFORE, the Parties hereby agree as follows:
BASIC LEASE
Effective Date: ...........r.a. . Jay • 2000
Tenant , •,•••• ............. .j W-r - fiq.'.on Bernardino. ..'R':f.
TenanYa Trade Name: ....................................... :SYn'.Bymordino Police Department
Community Police Facility
Premises Address: .71.}rA 2ND STREET
......•..............•.............•......... SAN SERNARDINO, CA 92405
County. --......................................................... Son Amardino
Premises Sure: Aporoximstsly2. 501 net rentable square feet .
Term: ................................ _................... Sixty (60) months. computed from the first day of the first
calandarmonth on or after the Rental Commencement Date,
The Rental Commencement Date shall be fixed in a Delivery
'Estoppektc be executed by Landlord and Tenant in the form
zttwhedi hereto as Exhibit"E`.
Page I of 23
n Dollars per ear, Payable in equal monthly
Fixed Minimum Rwk...........................................
......................................... ... iiamorLl _Ol Y
' Y,I`talltifeilb of]wro tf 1=Tiq DDllere during the Term, subject
b j,4'${mPnt pursuant to Section 4.3.
Rental Adjustment Date:.. ................................... '�dOtPf�pl^leable.
Percentage Rate(forPomentape Rentat):.............. "e:7eti,,,,` parCent ( 0
Initial Estimated Common Area Expenses:.....,..,, j4:it.,* U per square foot of Premises Size per month,
sub*leadjustment pursuant to Section 5.5.
Use Of Premises:................................................. Community Police Facility.
The Promises shall be used solely for the use stated above
and for no other use or purpose.
Security Deposit:...........»....................I................ 2eia to`0 t
Broker:.......................................................... Not Applicable.
Adtlreeaea For Notices:
t eNOLORD IENAN
ALLAN STEWARD, INC. "" CITY OF SAN BERNARDINO
104 EAST STATE STREET Attention: Chief of Police
SUITE 0 710 North `0' Street
REDLANDS, CA 92373 San Bsmardino, CA 92401
( 909) 335-0333
These Basic Lease Provisions are intendeo*p.4pplement andlor summarize the provisions set forth In
the Lease Provisi Previsions of this
perative Pm s onssof this Lease. the Operative provisions
Provis Provisions this Lease shall
control.
OPE eyTlt#gPROV1310N5
IIRTlC4E 1
Pte.
1.1 Leased Premises. Landlord hereby leases u lo'.Tenant, and Tenant hereby leases from Landlord,
Nose certain Promises (consisting of lend and buil(linps end improvements) located as set forth In the Basic
Lease Provisions (hereMekar ro/arred to as the 'Promtaes6j. The Premises are outlined in red en 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 FXHI BIT'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.
�PC39l7�
1 7 Fivturinn Period. onh in the
improvement obligations (hereinafter referred to u the 'Completion Date') at leasteocement'). After landlord notifies
Basic Lease Provisions prior to the Completion Date (lbe 'Fi
Tenant of the Completion Dale, and requirements of Section 9.5 of this Lease. Tenant shall have the
right to ente purposes of equippipg.atid.fixturing the Premises, so long as such entry does not interfere
Ma In the event lbat'Tenant enters the Premises prior to the Rental Commencement
Date as permitted by this paragraph, all of the provisions of this Lease shall be in full force and effect except the rent
provisions.
improvements to the Premises have been substantially,completed (whether or not Tenant is tben ' ion of the
Premises u permitted in paragraph 1.3), Tenant shall deliver to Landlord a list of items cant deems oecessary for
y�udlord to cemplao or corrsct in order for the Prerrel o to be .ceeptabi.. • .11 complete or correct each item
contained in the list delivered by Tenant to landlord other t] ch Landlord may contest• If Tenant tails to
deliver the list to landlord within the five (5) day 'bed in this paragraph. Tenant shall be deemed to have
accepted the Premises m being in ► good table condition and shall be deemed to have approved the construction
u having been completed in and workmatike, fashion, In the event Tenant does deliver such list to Landlord
within the five ( nod described iu this paragraph,.Tenant shall be deemed to have approved the construction as
Navin mpleted in a good and workmanlike fashion and shall be deemed to have accepted the Premises as being to a
IS Rental C mmencement Dale. The Rental Commencement Date shall be fixed in a Delivery Estoppel to be
xetuted by Landlord and Tenant within five (5) days aker7eoant is lhemtn possession of the Premiseq aa asawssai+w
1.6 Changes. Landlord shill have the right,at any time, to change any or all of the following items so long as
the change does not substantially interfere with the ingress to end'egmss from the Premises or the flow of vehicular traffic
in the Shopping Center. _
(a) The location, in the Shopping Center, of the Building in which the Premises arc located (but such change
.hall not be need.following the completion of the Premises).
(b) The location, in the Shopping Center, of the Premises (but such change shall not be made following the
completion of the Premises).
(c) The plot plan of the Shopping Center..
ARTICLE 2
BUSINESS RIGHTS AND RESTRICTIONS
2.1 Use. Tenant shall bave the right to use the Premises for the use set forth in the Basic Lease Provisions. No
other use of the Premises shall be permitted. Nothing contained herein shall be deemed to give Tenant any exclusive right
to such use in the Shopping Center. Tenant shall 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 governmeelal authority having jurisdiction to be a violation of law or of said certificate of
occupancy. Tenant shall comply with any direction of any governmental authority having jurisdiction which shall, by
reason Of the nature of Tenant's use or occupancy of the Premises, impose any duty upon Tenant or Landlord witb respect
(2.1 emtanued on page 4)
Para 2 of 7i
1.7 Relocation of Tana ea 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 Promises")
within the shop buildings, subject; however, to the following terms and conditions:
A. The Relocation Promises shall have approximately the same rentable square footage as
is contained In the Premises,
B. The Relocation Premises shell 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 Tenants share of the "costs and expenses
of operating and maintaining the Center Common Faclllties," 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 Tenant's 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 (901 days period, shall mutually agree in writing
upon;
(!) the scope and cost of all leasehold Improvements to be constructed at the
Relocation Promises, which shall be substantially similar to those of the
original leased Promises, adjusted'proportionatey for size;
(ii) the extent of Landlord's contribution to;fhe cost thereof, If any,and;
(iii) a timetable for their completion. Landlord and Tenant shall use best efforts
and act In good faith to agree on the terns. 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 ralocaton, 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 limtted to only already completed buildings.
rawraRu
Page 8-a
to the Premises or with respect to the use or occupation thereof, Tenant 6211 not do or permit to be done anything which
will invalidate or inereaae the cost of any fire, extended coverage or any other insurance policy covering the Building
Complex and/or property touted therein and shall..comply witb all rules, orders, regulations, recommendations and
requirements of the Pacific Fire Rating Bureau or ,any, other organization performing similar function. Tenant shall
promptly, Upon demand, reimburse Landlord for any additiopal premium charged for such policy by reason of Tenant's
failure to comply with the provisions of this Article, but such reimbursement shall not be construed as curing Tenant's
default for failing to comply with the provisions of this Article. Twmt shall not do or permit anything to be done in or
about the Premises which will m any way obstruct or interfere with the rights of other tenants or occupants of the
Shopping Center, or injure or many them, or use or allow the Premises to be used for way improper, immoral, unlawful or
objectionable purpose, nor shall Tenant cause, maintain or permit any nuisance in, on or about the Premises. Tenant shall
not commit or suffer to be committed any waste in or upop;1hePremises.
2.2 s noirnnmenlal Restrictions. Tenant shall not engage in any activity on or about the Premises that violates
any Environmental Iaw, and shall promptly at I Want Is sole cost and expense, take all investigatory andlor remedial
action reasonably required by Landlord or ordered or required by way governmental agency or Environmental Law for
mater
op and removal of boy
contamination involving way Hu rdoua Material created, caused directly or indirectly or
materially contributed to by Tenant, The term 'EoviroomeolaL Law' shall mean may frdenl, suit or local law, aurute,
ordinance or regulation pertaining to health, industrial hygiene or the eoviroammW conditions on, under or about the
Premises, including without limitation, (i) the Comprebensivo Environmental Response, Compensation and Liability Act
of 198(1 ('CERCLA'), 42 U.S.C. Sections 9601 ct seq.;-(ii)�tbe Resource Conservation and Recovery Act of 1976
(-RCRA'). 42 U.S.C. Sections 6901 at seq.; (iii) California Health 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) the Porter-Cologne Water Quality Control Act,
California Water Code Section. 13000 et seq.; and,(YO California Civil Code Scctioa 3479 at seq., es such laws are
amended and the regulations and administrative codes applicable thereto. The term 'Hazardous Material' includes,
without limitation, any material or substance which is (a) defined or listed as a 'hazardous waste', 'extremely hazardous
waste', 'restrictive hazardous waste' or 'hazardous substance' or considered a waste, condition of pollution or nuisance
under the Environmental Lens (b)petroleum or a petroleum product or fraction thereof; (c) asbestos; andlor
(d) substances known by the State of California i
to cause cancer and/or reproductive toxicity. It is the intent of the names
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 Watcr and Toxic Enforcement Act of 1986, California Health and Safety
Code Section 25249.5 et seq. Tmant shall provide prompt written notice to Landlord of the existence of Hazardous
Substances on the Premises and all notices of violation of the Environmeoul Law's received by Tenant. Tenant shall not
bring onto, create or dispose of, in or about the Premises of the Project, including but not limited to its sewage or storm
drain systems, any Hazardous Substances.
Notwithstanding the foregoing, Tenant may utilizk 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 Tcoant
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 Premiserin excesSbf that amount which would be consumed or sold by Tenant's
normal operations within sixty (60) days. All Hazardous Substances stored within the Premises shall be clearly labelled
and adequately safeguarded so u to avoid my spili or release of such Hazardous Substances.
2.3 Use Restrictions. Tenant shall not be permitted to: (i) conduct any auction or bankruptcy sale; (ii) conduct
my fee sale; (iii) conduct my closeout sale except at the expiration of the lease term; or, (iv) sell my soulled 'surplus',
'Army and Navy' or 'secondhand' goods as those terms are generally used at this time and from time to time hereinafter,
in, on or from the Premises.
Page 4 of �23
ARTICLE 3 _ He to
TERM
The Term shall commeacc when Landlord has substantially completed coostruction of the Premises and the
Shopping Center in which the Premises are located pursuant to the provisions of EXHIBIT 'C', or on the date upon w
Tenant has first opened for business from the Premises, whichever event occurs first. The parties shall immediately
execute a document in the Form of Exhibit 'E' to this Lease stating the date of commencement of the Term when it has
been ascertained. The Term shall be is set forth in the Basic Lase Provisions. In the event that Landlord is unable to
deliver possession of the Premises to Tenant within eighteen (19) months following the execution of this Lease, this Lase
shall automatically terminate and be of no further force or effect. `
ARTICLE 4
RENT
b
4.1 Fxed hfinimum Rent. Tenant shall pay a fixed minimum rent to Landlord at address set forth for
notices to Landlord, or at such other address as may be specified by Landlord, without prior de�d, deduction or setoff
during the term of this Lease. The fixed minimum rent shall be payable on or before the first day of each calendar month
during the term in the amount set forth in the Basic Lase Provisions.
4.2 Percentage Rent.
at the time and in the manner herein specified as percentage rental hereunder a sum equivalent to the a any, by
which the percentage set forth in the Basic Lease Provisions as the 'Percentage Rent' of the as defined below)
in any month exceeds the fuel minimum rent payable during the same tooth.
Within tea (10) days after the end of each cale¢du the term hereof, commencing with the tenth (10th)
day of the month following the commencemen t o u hereinabave provided), and ending with the troth (10th) day
Of the mouth next succeeding the last the lease term, Tenant shall furnish to Landlord, at the place where rent is
then required to be paid a terms hereof, a statement in writing, certified by a duly authorized officer or
represeotative o to be car=t, showing the total gross sales made in, upon or from the Premises during the
pr each, mooch, and shall accompany ach such statement with a payment to Landlord equal to the percentage
4.3 Rental .Adiasonent.
date set forth m the Basic Lease Provisions u the rectal adjustment date, u follows:
The base for determining the adjustment shall be the Consumer Price rban Consumers, for the Los
Angeles-Anaheim-Riverside Ara (1992-94 >• 100) published by the t Department of Labor, Burau of Labor
Statistics (Index) which is published for the calendar mo 3) months prior to the first full month of the lease term
(Beginning Index). If the Index published oath which is three (3) months prior to the adjustment date (Extension
Index) has increased over th g Index, the fixed minimum rent for the following year (until the next teat
adjustment) shall multiplying the fixed minimum rent for the initial full month of the term by a fractioa, the
nume ch is the Extension Index and the denominator of which is the Beginning Index; provided, however, that
OF the
Index shall be converted in accordance with the coaversion factor ub ' epartmeot of Lahor,
Burau of Labor Statistics. If the Index ' urmg the term of this knee, such other guvernmeet.
index o it is replaced shall be used in order to obtain substantially the same result as would have
4.4 Late Pavmm LSn Teoaat hereby acknowledges that late payment by Tenant to Landlord of rent and other snag
due hereunder will =use Landlord to incur costs not contemplated by this Lase, the exact amount of which will be
AA
Page 5 of 23
extremely difficult to ascertain. Such costs include, but are not limited to, processing charges, accounting charges and late
charges that may be imposed on or incurred by Landlord. Accordingly, if any Installment of rent or any other sum due
from Tenant shall not be received by Landlord or Landlord's designee within five (5) days after such amount shall be due,
then without any requirement for notice to Tenant, Tenant shall pay to Landlord a late charge equal to ten percent (10%)
of the amount which would otherwise be due. Additionally, Tenant shall pay to Landlord a charge of fifteen dollars
($15.00) for each check which is dishonored or returned by Tenant's batik for any reason. The parties hereby agree that
such Charges for late payments and for dishonored checks represent a fair and reasonable estimate of the Cost Landlord will
incur by reason of such occurrences. Acceptance of such charges shall in no event Constitute a waiver of Temot's default
with respect to such overdue or dishonored amounts, nor prevent Landlord from exercising any of its rights and remedies
granted hereunder.
4.5 First Partial Nfonth. if the eemmeeeemeat data aeaniq an - day sibel oboe the F1191 do, OF
(a) Fixed minimum teat for the partial month shall be prorated, b rty (30) day mooch, and as
so prorated shall be paid on the commeaeem , ' a ition to the rental due for the first full month
- of the term. -
Lease, and the daily minimum rent provided in this i !*in addition to
- minimum rent paid for s in computing the percentage rent payable for that
4.6 Gross Sales. '
(� The entire amount charged for the full price at the time of the initial transact- for all
merchandise sold or delivered or services rendered by Tenant whether or not amounts are
actually received at the time of sale;
(ii) The gross amount received or charged by Tenant for merchan ' sold or services rendered
pursuant to orders received by telephone, mail, house-to- or by other canvuing, and
attributable to the Premises whether or not filled elsewhe , and,
(iii) All gross income of Tenant from any operatio , at, from or through the use of the Premiss,.
including, but not limited to, sales made means of mechanical or other vending machines
located in, at or on the Premises.
(b) There shall be excluded from gross or deducted therefrom if previously included:
O Cash refunded or it allowed on merchandise returned by customers.
(ii) Sales , excise taxes, or other similar taxes.
(c) The Tenant' is used in this paragraph includes the named Tenant and any agent employee,
li or concessionaire of the named Tenant, or any other person or firm conducting b ' ess in, at,
4.7 Record.
concessicaaim to keep and preserve, for a period of not less than three (3) years fbU o e original
term of this Lease or any extension thereof, complete, accurst of all amounts received during each
lease year in the Premiss, includ' register detail tapes. However, in the use of a controversy
ss� tage rent payable hereunder, Tenant shall keep and preserve said records until the
bearing directly on Tenant's gross sales hereunder. In audit' or a copy of Tenant's
California State Sal ys o awing the date oa which Nth reNra is filed with the Franchise
4.8 Audit. _ meats far the
transacted in the Premises, whether or not included in 'grow sales'. If the audit di
period audited are inaccurate, adjunmect shall be trade item eauoa by Landlord. If the audit further
discloses that Tenant has understated t y two percent (2R) or more, Tenant shall immediately pay the
cost of the a ogether with any amauata due Landlord u a result of such undo tatement, which amounts
ARTICLE 5
CONMON AREA
5.1 Definition. The common arm is that area withia the Shopping Center which is➢Either occupied by buildings
(excluding roof overhangs and caopies, columns supporting roof overhangs and canopies, and subsurface foundations)nor
devoted permanently to the exclusive use of a particular Tenant, except that arras containing pylon signs and buildings or
structures which are used with respect to the Operation of the common arm shall be deemed to be part of the common arm.
5.2 Use. During the lease term. Tenant, its concessionaires, licensees, invitees, agents, customers and employees
shall have the nonexclusive right to use the common arm in common with landlord, other owners of portions of the
Shopping Center, other lessees, and their respective norr s ionaues, licensees, invitees, agents, customers and employees,
subject to the provisions of this Lease.
5-3 Maintenance. Landlord shall be responsible for managing and maintaining all improvements on the common
arm in good and sanitary order, condition and repair, including making replacement where necessary, and in compliance
with all governmental requirements, including, without limitation, (1� managing; (it)cleaning and removing rubbish and
dirt; (iii) providing labor, payroll tuts, materials and supplies; (iv) providing all utility services utilized in connection
therewith; (v) maintaining, repairing, replacing and providing reserves for replacement and remarking paved sad unpaved
surfaces, curbs, directional and other signs, landsaping, lighting facilities, drainage and other similar items;
(vi) providing casualty, public liability, property damage and other insurance on the common area, (vii) providing tools,
machinery and equipment used in connection with the above, (viii) paying all real property and personal property taxes and
assessments levied or imposed against the common aru; and, (ix) paying any regulatory fee or surcharge or similar
imposition imposed by governmental requirements based upon or measured by (a) the 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 on its income generally). - -
64 F
5.4 Records.
These records shall u a r tress rs ou at the offices of Landlord for
5 Tenant's Contribution.
fixed minimum mat to Landlord, Tenant's pro rata shun of the amount of all expenses descri� ph 5.7.
Tenant's pro rati share shall be equal to the ratio which Tenant's floor arm bears to er arm in the Shopping
Center, whether or not then occupied. Tenant's monthly payment � all be based upon equal monthly
Installments which have been estimated is advance by Landlo icular calendar year. Landlord may. within six?
(60) days after the end of such year, or as son as may be practical, prepare an accounting of the actual eommne
um expenses incurred during , upon completion of any such accounting shall invoiceQaant, or allow n a
credit against the installments next due, u the ease may be, the difference between Tenant's sham of the
taw area expenses incurred during such year. and the amount actually paid by Tenant with respect mammon
— r —
Page 7 of 23
possible, to an amount equal to one-twelfth (1112) of the actual rpa y Landlord to be
encountered during the cu s are of common arm expenses shall be the amount set forth in the
5,6 Operation and Contral. Landlord shall have general possession and control of the entire common area and
may, from time to time, adopt rules Lod regulations pertaining to the use thereof. Landlord shall, except as otherwise
provided herein, operate and maintain the common area during the lease terra 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 substirute operator, including but not limited to, any Tenzer in the Shopping Center, to carry out any
and all of Landlord's rights and duties with respect to the common area as provided in this base; and Landlordtmy enter
into a contract either by a separate document or in a lease agreement with such operator on such terms and conditions Lad
for such period as Landlord shall deem appropriate; and, if Landlord does so, the substitute operator, rather than
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 am operator for the Shopping Center, Tenant shall have neither voice nor control in
the operation and maintenance of either the common arra 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 Lay other recant within the Shopping Center.
5.7 Employee Parkins. Landlord may designate what part of the common arm, 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 he
entitled to enforce this provision by requiring the payment by Tenant ofauch 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 Ohstnrction. 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
stonge of merchandise or any business activities of any kind whatsoever be conducted therein without Landlord's prior
written consent; nor shall any person 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 create eisiLsf\rs�prder or
commotima.
ARTICLE 6
MERCHANTS ASSOCIATION
r
Center, Tenant shall join and maintain membership in good standing m such t lord of
any of the other peones of the Shoppin C ran such a Merchants Association in the future,Tenser
shall sv s all do all things reasonably necessary in order to aid the formation of such Merchants
ARTICLE 7
TARES
7.1 Personal Property Tuts. Tenant shall pay, before delinquency, all license fees, public charges, property
taxes and assessments on the furniture, futures, equipment, inventory and other property owned or biing used by Tenser
at any time situated on or installed in the Premises, together with all license fees, permit fees, assessments and other rays
levied, assessed or imposed by law or ordinance upon Tenant or upon the business operated by Tenant, and shall, open .
request, deliver proof of such payment to Landlord.
Page 8 of 23
i
7.2 Real Property Taxes. !
any and all real property toes and general or special assessments and installments the mg any
to on rent which is substiruted in whole or in part for real property meats and nay IieeLSe
fee imposed by a local governmental body on the rent, and excluding federal and state
income tun) which shall, during the levied or assessed against all or any portion of the
Premises or imposed o aid real property taxes and assessments for the first and last lease
)cart h if necessary, be prorated and apportioned between Landlord and Tenant to
upon individual assessment valuations (or proration) supplied by the County r otha
reguluory agency. Said proration shall be coaclusive upon both the parties otherwise
mutually agree in writing. In the absence of a pro ' t by the County Assessor or other
regulatory agency or a written agree a parties, Tenant's share shall be determined by
multiplying the Amount orth,in the tax bill which includes the Premises by a fraction in
which the
is the floor area of Tenant's Premises and the denominator is the floor area of all
seatiwiei-'- - -
commencement of the term are changed so that a tax, assessment or excise on rents or tax,
charge, or see••""^•^t, however described, is levied or assessed against a direct substimtioo
in whole or in part for any real property cues, Tenant shall a elinqueocy the substitute to or
excise on rents, but only to the eztept that it can amed that there hu been a substitution and, u a
result, Tenant has been relieved fr ymcot of real property rues that would otherwise have been
obligated to pay. T are of any to or excise on real pursuant to this paragraph shall be
substanti me u, and u a substirute for, the payment of such real property taxes u provided in
and expense to contest the amount or legality of any said real property razes nuts on or
attributable to the Premises, including the right to apply for Lb ereof, provided, however,
Tenant shall prosecute any such contest with du ce and shall, forthwith upon the final
determination thereof, pay the amouo yes property taxes and assessments on or attributable to
the Premises u so des ogether with any interest, penalties, costs and charges which may be
payable ' toa therewith. Prior to any such contest, Tenant sball post such security or take other
ARTICLE S
UTILITIES
Tenant shall arrange for all connection and hookup of, and shall pay, before delinquency, all charges for water,
gas, heating, ventilation, air conditioning, electricity, power, telephone,Ame6aeWrir and other utility services used an
or serving the Premises during the lease term. Nothing contained in this Lease shall limit Landlord in any wny, 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 Lrrtorovesnen s. Tenant, u its sole cost and expense, shall be responsible for decorating sod
providing any leasehold improvements which may be required by T—at at the commencement of the term. SovA
k,
Pane 9 of 23
leasehold improvements shall be subject to the reasonable:stppioval of landlord, which approval shall be obtained in
writing prior to the commeocemeot of any construction. In no event shall Tenant make any change to the exterior
appearance of the Premises, or any change to or openings in the. structural portions of the Premises, including, but not
limited to, bearing walls, roof and foundation, nor any penetration of the roof, unless Tenant shall have first delivered to
I,xndlord a complete engineering analysis of the tffmts of such changes to the Premises and shall have received Landlord's
express written consent to such changes. Within fifteen (15) days following the completion of any improvements, Tenant
shall deliver to Landlord a complete set of 'as built' blueprints, Tenant's failum to obtain Landlord's written consent
prior to the commencement of any improvements shall be deemed to be a material breach of this Lease.
9.2 Landlord's Repairs. Landlord shall, at its own expense, keep in good condition and repair the roof
(excluding ceilings), downspouts and rain gutters, foundations and structural portions of exterior bearing walls, but,
excluding any glass, windows, doors, skylights or other openings contained tberein.
9 3 Tenant's Repairs_. Except as expressly provided in paragraph 9.2, Landlord shill not be obligated to make
repairs, replacements or additions of any kind whatsoever upon the exterior or interior of the Premises. The Premises,
,Nether with say equipment, faeililiea or futures shall, at Teeara's sole expense, I>e kept, repaired, maintained, replaced
or added to at all times by Tenant in good order and in and safe condition and repair and in accordance with all
governmental requirements and insurance requirements, specifically, including, but not limited lo, all glass of the Premises
(including but not limited to exterior plate glass) and the beating,veotilating and air conditioning system. Tenant shall be
expressly responsible for my maintenance or repairs required wllh respect to the utility lines, conduits or pipes serving the
Premises, whether or not located in or on the Premises. Notwithstanding anything to the contrary contained herein,
Landlord shall have no obligation to repair any damage An the Premises caused by my negligent or intentional act of
omission of Tenant, and Tenant shall be solely responsible foi any such required maintenance or repair, including but not
limited to leakage caused by the installation or maintenance of Tenant's equipment on the roof of the Premises. Tenant
hereby waives my right to make repairs to the Premise at Laedlord's expense, whether pursuant to Sections 1941 and
1942 of the California Civil Code or otherwise.
an independent intoning contractor for the maintenance of the air conditioning, heating and ve systems
serving the Premises, Ps M
located on the Premises, together wit led equip mmtm r system located on the
Premise, and (iii a e Tint any Landlord installed security system, and
dlord elect to contract for any or all of these
services Tenant shall promptly reimburse Lao r the cost of such contra ,
it Ton pt of landlord's nvoice for a e,�w�invoice shall be
rendered by Laodlor ant not more often than monthly. Landlord shall have the right but i ated to commene t.e a i0 da d' u T t d at anv amt or
I
9.5 Alterations. Tennant shall not make agy'alterations to the Premises wbatsoever without Landlord's prior
written consent, which shall be granted or denied in'ioeordwee with the provisions of paragraph 9.1. Any alterations
made by Tenant shall remain on and be surrendered wiib'the Premise upon expiration or termination of this Luse, except
that Imdlord may elect, within ninety (90) days Were expiration of the term, or within ten (10) days after expiration or
termination of the term, to require Tenant to remove alterations that Tmant has made to the premises. If Landlord so
elects, Tenant, at its wit cost, shall retore the Premises to a tenantable condition, reasonable wear and tear excepted,
before the last day of the term, or within thirty (30) days after notice of election is given, whichever is later. If Tenant
makes my alterations to the Premises as provided in this paragraph, the alterations shall not be commenced until fifteen
(I5) days after Iandlord has received botice from Tenant slating the date the installation of the alterations is to commence
so tbat Landlord can post and record an appropriate notice of nonresponsibility.
Page 10'6f 23
ARTICLE 10
INSURANCE
10 1 Use, Rate. Tenant shall not carry any stook,or goods or do anything in, on or about the Premises wbi cb will
in any way iocrrue insurance tales on the building in which the Premises are looted. In no event shall Tenant carry on
any activities which would invalidate any insurance coverage thereon.
Tenant 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 the Premises, but this provision shall not be deemed to limit in any
respect Tenant's obligations under Article 14.
10.2 Liability Insurance,
(a) Tenant shall, at its sole cost and expense and at all times during the term of this Lease, or any extension
tb..+of, m.iaau .nd carry for the joint benefit of Tenant and Landlord, bodily injury and property
damage liability ins trans by the terms of which Tenant end Landlord shall be indemnified against
liability for any damage or injury to property or person (including death) occurring in, on or about the
Premises, or any part thereof, of arising from the use or occupancy thereof, or arising directly or
indirectly from soy act or omission of Tenant, its employees, agents, concessionaires, representatives,
assigns, guests or licensees. Said liability insurance shall be in an amount of not less than One Million
Dollars ($1,000,000.00) combined single limit, and Tenant shall maintain with Landlord at all times
during the term of this Lase a curreotly effective certificate of insurance satisfactory to Landlord from
each insurance Cartier providing such insurance coverage. Tenant is self-insured for this
amount. . .
(b) Landlord shall maintain a policy or.policies of comprehensive liability insurance issued by cot or more
insurance carriers, insuring against liability for injury to or death of persons and loss of or damage to
property occurring in or on the common arm, except any portion thereof subject to Tenant's exclusive
control.
together with Tenant' pat m connection with any claim
1" lle re
30,3 Worker's Comoensetion Irtsurnnce.
in compliance with a s ta t tty insurance with minimum coverage of Five
10 4 Fire hsurance. - -
(a) landlord shall pay for and shall maintain m.full force and effect during the term of this Lease a policy or
policies of insurance coveting the buildings located on the Premises for the perils normally insured under
the California Standard Fire Insurance Policy with extended coverage, vandalism and malicious mischief,
and sprinkler leakage (if applicable) endorsements attached. The Landlord may maintain in lieu of the
extended coverage and vandalism and malicious mischief endorsements, other broad form or all-risk
eodorsementa whicb may broadeo the perils insured against. In addition, the Landlord.may maintain
flood and earthquake insuranca coverage in its sole discretion. The property coverage shall be in an
amount equal to the full replacement cost (without deduction for depreciation) of the buildings insured.
The policy may contain the standard form lender's loss payable endorsement issued to the bolder or
holden of a mortgage or decd of tool•-sxorcd by the Premises. �ena�abalFwi��wa-iii
premiums incurred by Landlord for,.suoh�'iusurnnce within ten (!0) da s o eoanl of
Lan statement therefor. If such-insurance cov m addition to Tenant's Premises,
Tenant's share of the prcttilunv s o t e premium allocation made by the insurance carrier
and, if the ce such stkration, then on the basis which Tenant's floor arm burs to the
r�na wwsa+ir sm _-- - A A
R
Page 11 Of 23
-e&)— ;980 shall Fag FOP smi wiow6 ip hil famo mj As" 4-619 We I
policies of insurance covering Tenant's stock,in trade, trade firm of er perSOn]I
property located in, 0a or about the Pr a mans in connection with its business.
Such covers n s normally insured under the California Standard Fire Insurance Policy
7ra a 5 Biness Interrootion Insurance.
full forcct during the term of this Lease a policy of insurance rent will be paid to
Landlord iod of not less than ti n sea are destroyed or rendered inaccessible by a risk
insured fire and extended coverage insurance, with vandalism and malicious miutuef
10,6 Waiver of Suhroeation. Each party (,ip}ured')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 danWga 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 carved by the insured.
10-7 General Reouirements.
.(a) All policies of insurance required to be;carried hereunder by Tenant shall be written by companies
satisfactory to Landlord and liceosed to do business in the Slate of California:
Y': s
(b) Each policy of public liability insurairow required to be carried by Tenant shall be primary and
noncontributing with soy insurance carried by the Landlord.
(c) Each policy required to be carried by.TonaeGShall.expressly include, severally and not collectively, as
additional named insured thereunder,.Lasdlard and any person or firm designated by Landlord, u 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 mimed.insured. The policies of insurance required to be carried
by Tenant, or duly executed certificates evidencing them, together with satisfactory evidence of the r
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 fixmring or other activity to be carried no 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 is effect, and Tenant shall pay to Landlord the premium cost thereof
upon demand with interact at the highcat'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-called '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 Duty to Restore. If the improvements nn the Premises or the Shopping Center are partially or bully
damaged by fire or other casualty w as to become partially or totally untenanlablc, which damage is insured against under
any policy of fire and extended coverage insurance den.covering the damaged improvements, this Lease shall not
Page 12 of 23
tettainate and said improvements shall be rebuilt by Landlord with due diligence at Landlord's expense unless Iandlord
elects to terminate this Lease as provided in paragraph 11.2.
11.2 Election to Terminate. If either the improvements on the Premises or the Shopping Center as a whole, are
damaged by an insured cas,ialty to the extent of At least twenry-five percent (25%) of their respective replacement cost
(cost to repair or replace at the time of loss without deduction for physical depreciation) during the term of this Lease other
tbm during the last three (3) lease Years of said term, or to the extent of at bast ten percent (10%) thereof during the tut
three (3) years of aid term, or to any extent by an uninsured cause at any time during the lease term, or by an insured or
uninsured cause during any extension or renewal of 00 lease term, Landlord shall, within not more than ninety (90) days
after such damage, notify Tenant of Landlord's election to terminate this L or to restore the improvements on the
use
Premises =a such portion of the improvements in the balance of the Sbopping Center as in Landlord's sole discretion is
necessary to create an economically feasible commercial unit. If Landlord elects to repair or restore the damaged
improvements, then with respect to the Premises, Landlord and Tenant each shall restore them in the acme manner and to
the same extent as work was done by each of them in the original construction and fixturiring of the Premises, and the
damaged improvements in the balance of the Shopping Center shall likewise be tutored l0 the extent required in the
pr eding mntence. If Landlord elects not to restore, as aforesaid, this base shall terminate effective as of the date of
such damage upon the giving of notice of election by Landlord as aforesaid. If Landlord elects to restore or fails to give
notice of its election as aforesaid, then this Lease shall remain in full force and effect.
.113 Rent Adiultment. If this Ltase is not terminated as provided in this Article 11, then during the period of
repair and restoration, if and only to the extent that Iem=t's payment obligations under this Rase would not be covered
by rental interruption or other insurance required to be carried by Tenant pursuant to the terms of this Lease, the fixed
minimum rent shall be abated by that proportion which the floor area rendered unusable m a result of such damage bears to
Tenant's total floor ecru before such damage. In no event, however, shall Tenant's share of common area expenses be
abated unless the common vca expenses paid by each of the other tenants located within the Shopping Center are abated by
Landlord.
ARTICLE 12
EMINENT DOMAIN
12.1 Definition. If there is any taking of cc-damage. to all or any part of the Shopping Center or any interest
therein because of the exercise of the power of eminent.domain or inverse condemnation, whether by condemnation
proceedings or otherwise, or any transfer of any part thereof or my interest therein made in avoidance or threat thereof(all
of the foregoing being hereinafter referred to as 'taking') before or during the term hereof, the rights and obligations of
the parties with respect to such taking shall be as provided in this Article 12.
12.2 Total Takine. If there is a taking of all of the Premises, this Luse shall terminate as of the date of such
taking.
12.3 Partial Taking. If twenty-five percent (25%) or more of the floor area of Tenant's Premises shall be taken,
either party shall be entitled to terminate this Luse', or if eweety-five perccot (25%) or more of the floor area of all
buildings in the Shopping Center shall be taken, whether Tenant's Premises arc taken or not, Lt dlord (but not Tenant)
shall be entitled to elect to terminate this L-nse; and the terminating party shall give the other party written notice of such
election not later than thirty (30) days after the date Landlord delivers notice to Tenant that possession of title to the
portion of the Premises taken has vested in the coademacr. If neither party gives such notice or less than twenty-five
percent (25%) of the floor area of either Tenant's:Premises or buildings in the Shopping Center shall be taken, this Rase
shall remain in full force and effect and rent shall be adjusted as provided in paragraph 12.6.
12.4 Termination Date. If this Lease is terminated in accordance with the provisions of this Article 11, such
termination shall become effective as of the date physical possession of the condemned portion is taken by the condemning
authority.
Page 13 of 23
12.5 Repair and Restoration. If this Luse is cot terminated as provided in this Article 12, Landlord may, at its
sole expense, restore with due diligence the remainder of the improvements occupied by Tenant to 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 &cope of lbe'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 that which was
awarded to Landlord for such taking.
12.6 Rent Adiushont. If this Lease is not terminated as provided in this Article 12, and until such time as
Landlord Duty 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 the taking. In no event,
however, shall Tenant's share of common arm expenses be abated unless the common area expenses paid by each of the
other tenants located within the Shopping Center arc abated by Landlord.
12.7 Award. The entire award or compensation in such proceeding, whether for a total or partial taking or for
diminution in the value of the leasehold or for the fro shall belong to and be the property of landlord, provided that
Tenant shall be entitled to recover from the condemnor auch compensation as may be separately awarded by the condemnor
to Tenant or recoverable from the condemnor by Tenant in its own right for the taking of trade fixtures and equipment
owned by Tenant (meaning personal property, whether or not attached to real property, which coax b&=moved without
injury to the Premises) and for the expense of removing.and relocating such personal property.
ARTICLE 13
INDEMNITY WAIVER
13.1 Indemnity. Tenant shall defend, indemnify.and shall save and bold Landlord harmless from and against
any and all liens, claims, demands, actions, muses of4ction, obligations, penalties, charges, liability, damages, loss, cost
or expense, 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 soy portion of the common area which is under the
exclusive control of Tenant (the Premises and such portion of the common arm which is under the 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 the 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 nay acts or omissions (including, but not limited lo,
negligence or willful miscooduct) of Tenant or any inviter,.;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 m erty persons or prop sustained by Tenant or by any other person or firm resulting from the building in which
the Premiers are located or by reason of Tenant's Premises or {ray equipment located thereon becoming out of repair, ar
through the acts or omissions of any persons present in the Shopping Center or renting or occupying any pan of the
Shopping Center, or for loss or damage resulting to Tenant 'or property from bunt, stopped or leaking sewers, pipes,
conduits or plumbing fixtures, or for interruption of my 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 furnished to Tenant's Premises or resulting from
any accident in, on or about Tenant's Premises or the building in which the Premises are located.
ARTICLE 14
OPERATION OF BUSINESS
normal operating hours of similar businesses, but at 1 g t ours a day; (ii)
adequattly p oyem to bonnie. the maximum business and carry sufficient stock of
Page 14 of 23
► t ti .a a . ' n opslar.l b,.,.R =--- 61-40-1 (iv) keep the Premises and exterior and interior portions of
windows, doon and all other glass or plate glass fixtures in a put, clean, sanitary and Safe condition;{ a -'---c-' --. -�-�
a-"SW.. 4, gu,L - . - .- T..... :_,_"e. .""rr far MA- macart (vi) use for office or other non-selling purposes
only each apace as is reasonably required for Tenant's liusieesr, (vii) refrain from burning any papers or refuse of any
kind, or otherwise creating say noxious or offensive odors cc fumes, in the Shopping 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 the public
shopping in the Shopping Center
ix) observe and promptly comply with all governmental
requirements and insurance requirements affecting the Premises or say part of the common area which is under Tenant's
exclusive control and promulgated during the term of this Leine; (x) tot use the Premises or suffer or permit the Premises
or any part thereof to be used in my master that vvjll;ccoatitute a.nuisance or unreasonable annoyance to the public, to
other occupants of the Shopping Center or to the Landlord, or that will injure the reputation of the Shopping Center, or for
say extra hazardous purpose, or in say manner that will impair the structural strength of the 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 ogres not to install, eau or to allow to be installed or used, upon the described
Premises, say gaming machines or devices without the prior written consent of Landlord, including. but&Llimlled to.
video game machines.
ARTICLE 15
SIGNS, FIXTURES, RESTRICTIONS RE EXTERIOR
15.1 Fixtures. All fixtures installed by Tenant shall be new or completely reconditioned. Tenant shall not make
or cauaa to be made soy attentions, additions or improvements to�thc building, or install or erect or"use to be installed
or erected sty signs (including, but not limited to, exterior sigmS,,window signs and signs painted on doors or windows),
floor covering, exterior lighting, plumbing, fixtures, Shades of awnings, radio or television antenna, Satellite dish or
similar devices, or make say changes to the store front or exterior of the building, not shall tenant install any loud
speakers, sound amplifiers or similar devices which,wotnld,be.bard in adjoining suites or outside Tenant's Premises
without first obtaining Landlord's written approval met conseoi. Tenant shall present to landlord plans and specifications
for such work at the time approval is sought.
15.2 Siasss Tenant will not place or suffer to be placed or maintained on sty 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 sty sign or
advertising material within lg imcbes 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 written approval and consent. Tenant further
agrees to maintain such sign, awning, canopy, decoration, lettering, advertising matter or other thing as may be approved
in good condition and repair at all times. Tenant shall not place or suffer to be placed any merchandiu, equipment or
other items outside the building on the Premises.
ARTICLE 16
LIENS,
Tenant shall keep the Premises and the Shopping Celitt:t tree of any liens or claims of lien arising from any work
performed, material furnished or obligations incurred by Tedadt in connection with the Premises. If Tenant disputes the
correctness or validity of any claim of lift. Tenant shall, "'thin ton (10) days after written request by landlord, record
such bond as will release said property from the lien claimeC'TOnant shall defend, indemnify and hold landlord harmless
from and against any all cost or expense, including but not limited to attorneys' fees, arising out of soy lien or claim of
lien on the Premises.
K'
Page 15 of 23
ARTICLE 17
RIGHT OF ACCESS
Landlord and its authorized agents and representatives shall be entitled to enter the Premises at all reasonable
times for the purposes of. (i) inspecting them; (ii) making repairs which Landlord is obligated to make under this Lease;
(iii) curing a default of Tenant; (iv) posting any notice permitted by law that would relieve Landlord from respoasibility
for the acts or omissions of Tenant; (v) exhibiting the Premises to prospective buyers, lessees or leaders; and, (vi) posting
ordinary signs advertising the Premises for ale 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 the event of any actual or alleged failure, breach or default hereunder by Landlord.
(a) Tenant's sole and exclusive comedy shall be against landlord's interest in Ppiog Center.
(b) No partner, master lessor, officer, agent or employee a old shall be surd or named as a party in
any suit or action, or served with process, or to answer or otherwise plead to any service of
process, nor will any judgment be tak t my partner, master lessor, officer, agent or employee of
Landlord. Any judgment amst any partner, master lessor, officer, agent at employee of
Landlord may be v set aside at my time nurse pro tune. and no writ of execution w01 ever be
Imed ag . of soy partner, muter lessor, officer, agent or employee of Landlord.
(c) enanes and agreements contained within this Article 18 shall inure to the benefit of and shall be
ARTICLE 19
ASSIGNAiENT AND SUBLETTING
19,1 Constnt Reouired. Notwithstanding anythiog to the contrary contained herein, Tenant shall not assign this
Luse or any interest herein, or sublet, license, grant any concession or otherwise give permission to anyone other than
Ttaant to use or occupy all or any part of the Premise without the prior written consent of Landlord. The ale,
assignment, transfer or disposition, whether for value,by operation of law, gift, will or intestacy of(i) twenty-five percent
(259.) or more of the issued and outstanding stock of Tenant if Tenant is a corporation; or, Cti) the interest of any general
partner, joint venture, association or co-leancy shall be deemed an assignment of this LAW under this puagnph.
Landlord and/or Landlord's agent shall be entitled to in application fee of Five Hundred Dollars (S500.00) be paid at the
time of application for approval of my 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
cot t to the requested assignment or sublease.
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 throughout the remaining term of this Lease, including any renewal terms,
notwithstanding any subsequent or further assignment of this lose, whether or not Tenant his consented to or approved
such assignment Nor shall such liability be extinguished or reduced by my later amendment or modifieatim of this
Lase, whether or not Tenant approves or=a u to such amendment or modifiotioo. In the event of my assignment or
sublease, the assigae or sublessee shall agree in writing to perform and to be bound by all of the covenants of this Law
required to be performed by Tenant. Landlord's approval of one assignment or subletting by Tenant of its intern is this
Lease shall no be deemed to be an approval army further auigammt or subletting. Q
pR
Page 16 of 23
ARTICLE 20
NOTICES
Wbenever under this Lease provision is made for notice or demand, it shall be in writing and signed by or an
behalf of the parry giving the notice or making the demand and served by personal delivery, registered or certified prepaid.
n nail or
by telegraph. If served by registered or certified mail, it shall be deposited in the United Stites mail, stn e
with return receipt requested, addressed to the parry to whom such notice of demand is to be given at the address stated in
the Basic Lease Provisions, n the rase may be, and shall be conclusively deemed served on the date indicated on the return
receipt and if the receipt is not returned, then fortyeight (68) hours after mailing. If served by telegraph. service to be
addressee shall be conclusively deemed made as confirmed by the telegraphic agency making ry y
personal delivery, service shall be deemed made as of actual delivery. The address of either patty may be changed for the
tu
purpose of this paragraph by written notice to the other party.
ARTICLE 21
SURRENDER OF POSSESSION
21.1 Surrender. At the expiration or other termination of this Lem. 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 Aoldina Ozer.
(a) If Tenant holds over after the expiration of the term hereof with the express consent of Landlord, such
holding over shall, in the absence of a written agreement be deemed to have created a tenancy from
month-tc-mcntb, terminable on thirty (30) days written notice by either party to the other, at a filed
minimum rental equal to two hundred percent (200%) of the Curd minimum renal 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 be construed as consent to such holding
over by Landlord.
(b) If Tenant fails to surrender the demised premises upon the termination of this Lease, Tenaat 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 Base and conditioned upon performance of all of the provisions to be performed
by Tenant hereunder, Landlord &ball secure to Tenant luring 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 Lem, at Landlord's option, shall be subordinate to: (a) any fast and junior mortgages or
first and junior trust deeds that may hereafter be placed upon the Premiss and to any advanes to be made tberetmder, Roy
iotasst tbereoa and all rsmawals, replamments and extensions thereof, provided that such mortpgsea or benefieiais fast
request such subordination and thereafter agree in writing to recognize this Lem in tba event of forsdoaure if TmaA is
Page 17 of 23
te_r" ,.
not in default, (b) any so-called sale and leaseback of the Shopping Center by Landlord, and (c) any: (i) parking lot
agreement, (ii) common area mainttmamee agramcet, (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 my future
amendment or modification to any CC&R's. Tenant shall, 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 STATEMEN""I'
Tenant shall, at any time and from time to time within five (5) days after written request therefor by Landlord,
deliver without con to Landlord a certificate to Landlord or to any proposed mortgagee, tout deed beneficiary• purchaser
or successor in interest, certifying the commencement and expiration date of the lease term and that this Lease is that in
full force and effect and setting forth the amount and namro of the modifications, defenses or offsets, if any, claimed by
Tenant, together with such other information as may be reasonably requested by Landlord. If Tenant fails to deliver such
certificate within said five (5) day period, Tenant hereby appoints Landlord as Tenant's attorney-in-fief for the purpose of-
completing, executing and delivering the certificate to the person or firm requesting it ARTICLE 25
DEFAULT
2S.1 Notice and Remedies. In 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 called for hereunder, Tenant shall have a period of five (5)
days after service of written notice by Landlord specifying the nature of Tenant's default within which to mm such
defaults, provided that if the nature of a oon-monetary default is such that it cannot be fully cured within said five(5) day
period. Tenant shall have such additional time as may be reasonably necessary to core such default so long as Tenant
proceeds promptly after service of Landlord's notice and proceeds diligently at all times to complete said cure; provided,
however, that any such notice shall 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 deuiner action. If Tenant fails to comply with the
foregoing provisions, Tenant shall be deemed to be in breach of this Lease and Landlord, with or without further notice or
demand of any kind, may at its option:
(a) Terminate Tenant's right to possession of the Premises because of such breach and recover from Tenant
all damages allowed under Section 1951.2 of the California Civil Code, including, without limitation, the
worth at the time of the award of the amount by which the unpaid tent for the balance of the term after
the time of award exceeds the amount of such renal loss for the same period that Tenant proves could be
reasonably avoided; or,
(b) Not terminate Tenant's right to possession because of such breach• but continue this Lease in full force
and effect and, in such "eat, Landlord may mforce all rights and remedies under this Lease including
the right to recover the rent and all other charges due hereunder as such rent and other charges become
due hereunder or to inlet the Premises.
251 Tertant's Pro2t=. In the event of default, all of Tenant's property shaU remain on the Premise 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 propary and to use it real or charge free until all 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
253 Notice of Termination. No re-entry or relctting of the Prtmisa shall be construed as an dectioa by
Landlord to terminate Tenant's right to possession and this Lease unless a written notice of such intention is gives by
Landlord to Tenant and, notwithstanding any such reletting without such termination, Landlord may, at any dims
Page 18 of 23
thereafter, elect to terminate Tenant's right to possession and this Lease in the event that at such time Tenant remains in
default hereunder.
25.4 Waiver of Noti • - Performance by Landlord. Notwithstanding any provision of this Article 25, if,
(i) Tenant fails to comply with any governmental requirement, Tenant shall cat be entitled m notice of default from
m
Landlord or any right to cure beyond the period within which such compliance may be required by such governmental
requirement; (it) if this Lease expressly provides that this Lease may be terminated effective on service of notice, Tenant
shall be entitled to cure its default only if the right to cum 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 will jeopardize the Premises or the
rights of Landlord, landlord may, with or without notice, elect to perform those acts if 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 compelled to pay
or elects to pay any sum of[Honey, including, but not limited to, reasonable attorneys fees, such sum or sums in Paid by
Landlord, with interest thereon from the due of such payment at the rate provided in paragraph 25.5, shall be due from
Tenant to Landlord on demoted.
25.5 Interest. Any amount due to Landlord not paid wben due:ball bear interest at the maximum rate allowed
bylaw from the date due. Payment of such interest shall not exmue or cure any default by Tenant under this Lau.
25 6 Other Remedies. Nothing contained herein shall limit landlord to the remedies set forth in this Article 25
and, particularly, those which are set forth in paragraph 25.1, and upon Tenant's default, Landlord shall be entitled to
exercise any right or remedy then provided by law, including, without limiadoe, the right to obtain injunctive relief and
the right to recover all damages caused by Teeaet's default in the performance of my of its obligations under this lease.
Tenant, along with all other remedies afforded herein, shall share the right to my and all other remedies at law or in
equity. All remedies shall be distinct, separate and Cumulative. none being to the exclusion of the other.
ARTICLE 26
INSOLVENCY
26.1 Breach of Lease. The filing of any petition by or against Tenant under any chapter of the Bankruptcy Act,
or any successor statute thereto, or the adjudication of Tenant as a bankrupt or insolvent, or the appointment of a receiver
or trustee to take possession of all or substantially all 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 my sate or federal insolvency or bankruptcy
act, shall constitute a default under and breach of this Lease by Tenant, regardless of Tenant's compliance with the other
provisions of this base, 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 under Article 25.
26.2 0oeratien of Law, Neither this Lase nor any interest herein, nor my estate created hereby, shall pass by
operation of law under any sate or federal insolvency or bankruptcy act to any trustee, receiver, assignee for the benefit of
creditors or any other person whatsoever without the prior written consent of Landlord. Any purported transfer o in
violation of the provisions of this paragraph shall constitute a default under and breach of this Lease, regardless
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 en
the service of sucb notice without the necessity of further notice as provided under Article 25.
26.3 Non-Waiver. The acceptance of met 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, shall not preclude Landlord from exerusteg its
( rights under this Article 26 at any time thereafter.
Page 19 of 23
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 troy, at any time, engage a manager to operate the Shopping Center on Landlord's
event, Teasel shall pay to Landlord, within tea (10) days after ut not more often than
monthly, Tenant's ro a qed by such manager (which administrative fee shall not in
In addition, Tenant sball pay to Landlord a
collection charge of"ry Five Dollars ($75.00) for preparation of each demand for delinauent r=X4wdlor other sums
which may be due under this Lease.
ARTICLE 29
ATTORNEYS' FEES
If either party to this Ltase brings soy action or files any proceeding against the other pa* arising out of this
Lr or for the declaration or interpretation of any rights hemmder, the prevailing party therein shall be eatidel 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 parry') without its faols is made a party to litigation instituted by
or against the other party ('primary pay'), the primary party shall pay to the secondary party all costs and expenses,
including reasonable anorneys' fees and any judgment rendered, incurred by the secondary parry in connection therewith.
ARTICLE 30
WAIVER OF DEFAULT
The waiver by either party of nay default io 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 the saute or any other wveeant 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 otter sum or portion thereof so aexpted, regardless
of Landlord's knowledge of such preceding default at the time of acceptance of such rent or other sum.
ARTICLE 31
NO PARTNERSHIP
Landlord is not and shill not be deemed to be in any way or for any purpose an agent, employer, principal.
partner,joint venom or member of any joint enterprise with Tempt.
ARTICLE 32
SUBTENANCIES
The value" or other surrender of this Lear by Tenant or a mutual cancellation of this LAsm shall not a feet a
merges and sball, st Landlord's coca, terminate all existing subteoauia or operate as an assignment to Landlord of any
or all of such mbteoands. w.�Q
Page 20 of 23
ARTICLE 33
SUCCESSORS
Subject to the restrictions oa assignment or subletting contained herein, this !.ease shall be binding upon and shall
inure to the benefit of the parties hereto and their suecesson. The term 'successors' is used berein 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 art or omission of such party. Each covenant and
condition of this Leese shall be binding upon all assignem, agents, subtenants, licensees and Concessionaires of Tenant
ARTICLE 34
REMOVAL OF TENANT'S PROPERTY
Upon the expiration of the term of this Lease or upon any earlier termination hereof, Tenant shall immediately
remove, at its own expense, all trade futures, equipment, merchandise and personal property(collectively called 'Lessee's
property') which were installed by Tenant or any sublessee, concessionaire or licensee in or upon the Promises; but, if
Tenant is in default, Tenant shall Cot remove Temm's property unless notified by Landlord to do so.-In ease of nay injury
or damage to the building or my portion of the Premises resulting from the removal of Tent's property, Teams shell
promptly pay to Landlord the cost of repairing such injury or damage. In the event Tenant sbould fail to complete sateh
removal promptly, Landlord my remove any or all items of Tenant's property from the Premises and dispose of them in
any manner consistent with law and Tenant shall pay upon demand to Landlord the actual expense of such remo.-1 and
disposition together with interest at the rate prescribed in paragraph 25.5 from the date of payment by Landlord unto
repayment by Tenant.
ARTICLE 35
EFFECT OF CONVEYANCE
If, during the term of this Lease, Landlord conveys its interest in the Premises, or this Lease, they from and afros
the effective date of such conveyance, Landlord shall be released and discharged from any and ill further obligation and
responsibilities under this Lease, including, but not limited to, those relating to any security deposit held by Landlord,
except those already accrued of which Landlord has notice at the time of conveyance.
ARTICLE 36
INTERPRETATION/AMENDMENT
The captions by which the Articles and paragraphs of this Lease are identified are for coovenienee only and sbill
not affect the iaterpretatioa of this Lase. Wherevtr the contest so requires, the singular number shall include the plural,
the plural shall include the singular, the neuter gender shall include the muculine and the feminine ganders. If there is
more than one signatory hereto ss Tensest, the liability of such sigmtories shall be joint and several. If any provision of
this Lease shall be held to be invalid by a court, the remaining provisions shall remain in full force and effect and shall in
no way be impaired thereby. It is understood that there art no oral agreements between the parties hereto affecting this
Lease or any Addenda attached hereto, and this Lease(together with my Addenda attached hereto) supersedes and cancels
any and all previous negotiations, agreements, brochures, agreements Lod understandings, if any, between the parties
hereto or displayed by Landlord to Tenant with respect to the Premises desnrtbed herein, and no such extraneous or
ancillary material shall be used to interpret or construe the terms of this Lease. Tbem shill be no modification or
amendment of this Lease except as may be executed in writing by each of the parties hereto.
Page 21 of 23
` ARTICLE 37
TM EE OF ESSENCE
Time is of the essence of each provision of this Lease. All provisions relating to time shall be strictly construed.
ARTICLE 38
BROKERS
Landlord represents that it has utilized no broker 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
harmless from and against any cost, claim or damage incurred by Landlord as a result of any claim by any broker m other
person seeking a commission, finder's fee or similu 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.
ARTICLE 40
SECURITY DEPOSIT
40.1 Deposits. Tenant bas 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.
Page 22 of 23
ARTICLE 41
OPTION TO RENEW
Tenant is hereby granted the option to extend the term of this Lease for ONE(I)
FIVE(5) year period, hereinafter referred to as the "Extended Term", 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, 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 Tenn all of the
terns 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
ALLAN STEWARD, INC.
By '. 4'-� � L�"
Title.v-p *"u �, '.Mc
APPROVED AS TO FORM
AND LEGAL CONTENT
JAMES F. IVENMAN TENANT
CITY OF SAN BERNARDINO
C ATTORNEY
By:
JUDITH VALLES, MAYOR
Page 23 of 23
ADDENDUM TO LEASE AGREEMENT
BETWEEN ALLAN STEWARD, INC. (LANDLORD) AND
CITY OF SAN BERNARDINO (TENANT)
DATED: JANUARY 24, 2000
LANDLORD AND TENANT ACKNOWLEDGE THAT:
A. 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') high nor more than two feet (2') wide.
LANDLORD TENANT
ALLAN STEWARD, INC. CITY OF SAN BERNARDINO
By By:
JUDITH VALLES, MAYOR
Title:� (./W ��L
APPROVED AS TO FORM
& LEGAL CONTENT
JAMES F. NMAN
By:
16 ATT
ORNE NE
Page 23a of 23
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EXHIBIT "C"
TENANT IMPROVEMENTS
Tenant improvements, per the attached floorplan, will be completed by and at
the expense of the tenant. • +he-itelf s
Endorsement below constitutes Landlord agreement to all improvements noted
per attached floorplan.
LANDLORD: TENANT:
ALLAN STEWARD, INC. CITY OF SAN BERNARDINO
By By:
Title �FiIJ(. JUDITH VALLES
MAYOR
APPROVED AS TO FORM
& LEGAL C NTENT
JAMES N
By:
MY ATTORNEY
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EXHIBIT "E"
DELIVERY ESTOPPEL
COMMENCEMENT AND TERMINATION DATE OF LEASE AND
LESSEE'S OBLIGATION
Pursuant of the terms and conditions contained in this Lease:
1. The Commencement Date of the term of the Lease is, or shall be deemed to be
January 24, 2000.
2. The date upon which rent shall commence is January 24, 2000.
3. The date upon which the term of this Lease shall expire is February 1, 2005.
4. The date upon which Tenant received the keys to the Premises is February 1,
2000.
DATED this day of January, 2000.
LANDLORD
ALLAN STEWARD, INC.
B
Title:► AiA*v, *eA;6,r .
APPROVED AS TO FORM TENANT
& LEGAL CONTENT
CITY OF SAN BERNARDINO
JAMES FpPENMAN
By: By:
CITY ATTORNE JUDITH VALLES, MAYOR
Best
Marshalls
Plaza
San Bernardino
California
Sign Criteria
EXHIBIT " D"
SIGN CONSULTANT & DESIGN APPROVAL
Quiel Bros.
272 South I Street (909) 885-4476
San Bernardino, CA 92410 Fax (909) 888-2239
I. GENERAL
Signs are not only effective as store identification but are a source of
interest, excitement and good advertising when designed with taste and
in harmony with the design standards of the shopping center. The sign
regulations herein have been set up for the purpose of achieving the best
possible effect for store identification and overall design, while allowing
each tenant creativity within the limits of their leasehold. Experience has
proven that all stores in the Center benefit by the establishment of sign
controls such as herein set forth.
II. APPROVALS
A. The design and construction of tenants exterior sign must receive written
approval by landlord's design consultant prior to fabrication and
installation.
Landlord's approval shall be based on:
1) Conformity to the sign criteria established for the center, including
fabrication and method of installation.
2) Harmony of the proposed sign with the design standards of the Best
Marshall Plaza and co-tenants.
Landlord has the specific right to refuse approval of any sign which does
not conform to the specific criteria set forth herein.
B. To secure Landlord's approval, tenant agrees to conform to the
following procedure:
1) One copy of the detailed sign design drawing of the sign submitted
to Landlord at
Allan Steward Inc.
104 E. State ST. #Q
Redlands, CA. 92373
AND:
2) Four copies of the detailed sign design drawing of the sign
submitted to Landlord's sign consultant at:
Quiel Bros.
272 South I Street
San Bernardino, CA. 92410
C. Unless Landlord and design consultant have both received the above
described plans in the quantities set forth above. Landlord will not
approve tenant's exterior sign.
The sign drawings are to be prepared b a reputable state licensed
sign contractor. The sign drawings must indicate the following
information:
1) A scaled storefront drawing reflecting the proposed sign design
and all dimensions as it relates to the storefront elevation of
tenant's premises.
EXHIBIT "D"
Formerlv C-1
2) A plot plan indicating location of tenant sign.
3) Sizes of sign letters must be accurately dimensioned and spaced and
drawn at a minimum of 112'=1'-(Y" scale.
4) Section through sign and facia to show its construction methods.
5) Plexiglass colors, paint finishes and types of materials.
6) Neon tubing sizes, colors, wattages and intensity.
All drawings marked "Disapproved" or"Approved as Noted" must be
re-submitted as here and above set forth in paragraph "B" with required
corrections. Tenant or its sign contractor will not be permitted to
continence installation of the exterior sign, unless the following
conditions have occurred:
1) A stamped set of the final sign drawings reflecting Landlord or
Landlord's design consultant's approval are retained at tenant's
premises at all times during the installation of design and for a
period of thirty (30) days thereafter.
2) NOTE! No sign shall be constructed until approved building permits
from the City of San Bernardino Building and Safety Department are
received.
3) Tenant or it's sign contractor must obtain Landlord's approval of the
date the sign installation is to occur, which approval must be
obtained no later than 24 hours prior to installation date.
III. GENERAL SIGN CRITERIA & RESTRICTIONS
A. Each tenant shall be permitted one illuminated Pan Channel Letter sign
to be located only on the space and on the surface specially provided for
same on the building exterior in accordance with the drawings attached
hereto. No other signage is permitted on the exterior of the premises.
Tenants with a corner unit will be permitted two signs providing the
sign area does not exceed the maximum allowed by city codes or as
designated in this sign criteria.
B. Sign length shall not exceed 70% of leasehold width or in the event of a
sign band end wrap return which is less than leaseline, shall be
computed at not to exceed 70% of sign band width. Signable area shall
be centered on facia vertically and horizontally. Maximum and
minimum letter heights are reflected on page C-6 hereto. Optional logo
plaques and special one piece Pan Channel Letters are subject to
approval by landlord or his designated agent.
C. The advertising or information content on the sign shall be limited to
letters designating the store name or established trade logo as set forth
in signed lease documents between tenant and landlord. Tenant shall
display their established trade names only. The trade name may be
used only one time per permitted sign location. No additional
advertising will be permitted, ie: "Discount Sales", "Quality Shoes",
"Ladies Wear", prices, etc. or miscellaneous brand names included in
their operation.
EXHIBIT "D"
Formerly C-2
D. The face colors and type styles of all signs shall be subject to Landlord's
approval. In the event the tenant does not have an established exterior
sign identity, the Landlord recommends that the lettering style be
designed by the sign contractor to reflect a visually exciting look.
Established trade logos and signgage shall be permitted providing they
conform to the criteria described herein.
E. Logo cabinets used in conjunction with individual letters will be
considered a part of the sign, subject to Landlord approval.
F. The Tenant shall pay for all signs, their installation ( including final
connection, transformers and all other labor and materials) and
maintenance. Tenant sign contractor must file, pay for and obtain any
licenses, permits and variances as required for sign installation.
G. Note, page C-5, C-6, C-7 and C-8 are an integral part of the exhibit.
Please refer to these pages for additional information, location and
fabrications.
H. No box-type signs will be permitted.
I. Individual shop address numerals will be installed by the Landlord
J. No signs will be permitted on any awning.
K. No temporary signs of any nature will be accepted without prior
written approval by Landlord.
L. No tenant shall affix or maintain upon any glass or other material on
the storefront signs unless they shall first have received the written
approval of the Landlord, other than the signs shown on the following
pages of the criteria.
IV. FABRICATIONAND INSTALLATION
A. The fabrication and installation of all signs shall be subject to the
following restrictions:
1) All Channel Letters are to be fabricated 22 GA. Sheet metal with
welded seams filled and buffed prior to painting. Fabricated full
welded aluminum letters with aluminum backs will be permitted.
Channelume, Channel Classic and Channel Let-R-edge type letters
will not be permitted due to rapid deterioration factor (no
exceptions).
2) Letter faces shall be 1/8" thick, flat surface colored Plexiglass as
manufactured by Rohm & Haas or approved equal. Painted
plexiglass will not be permitted.
3) a. Retainer trim cap shall be 3/a" bronze" Plasco" brand trim cap
edge. Retaining screws shall be #7 x 3/8 Phillips-type sheet metal
screws. All trim cap retaining screws must be painted to match
bronze trim cap color.
b. 5" deep letter returns shall be painted minimum of 2 coats of
#8540A Dark Bronze Dupont Centari acrylic enamel as
manufactured by Dupont(enamel finish, to be semi-gloss).
EXHIBIT "D"
Formerly C-3
4) Neon tubing will be 13 millimeter, 3" on center or less.
5) 60 MA. High power factor transformers shall be used for all neon
tube system.
6) PK Housings or Hage connectors shall be used for all neon tube
system.
7) All sign letters shall be secured by concealed fasteners, stainless
steel or nickel or cadmium plated and pegged out from wall Y4" to
allow water runoff.
8) No exposed lamps will be permitted.
9) All penetrations of the building structure required for sign
installation shall be sealed in a watertight condition and be
patched to match adjacent finish.
10) No sign company labels will be permitted on the exposed surfaces
of the signs except those required by Underwriter Laboratories
which shall be placed in an inconspicuous location on first letter
only.
11) All Channel Letters must have a 3/16" dia. Drain holes at bottom
of every letter. All signs shall be fabricated and installed with U.L.
approved in compliance with all applicable building and electrical
codes. Sign manufacturer will supply a U.L. lable if required by
local authorities in an inconspicuous location.
12) The Landlord shall provide primary electrical service terminations
to the signage area on the rear side of the parapet wall.
13) All signs shall conceal all necessary wiring, transformers, ballasts,
starters and other necessary equipment within their individual
letters or behind storefront construction.
14) It is the responsibility of the tenant's sign contractor to verify all
conduit and transformer locations and service prior to fabrication.
15) Each tenant, or it's sign contractor, shall be responsible for the
repair of any damage to the building caused by the installation of
said tenant's sign.
16) Each tenant shall be responsible for the performance of it's sign
contractor.
17) Tenant shall be responsible for removal of his sign within (30)
days after vacating the site. Removal of the sign shall include the
repair of the wall surface back to the original condition.
18) Installing sign company must provide one color photograph
(Polaroid or equal) of installed sign to be sent to sign consultant
for approval along with a photocopy of a final approval by city
inspector prior to payment of balance by tenant.
EXHIBIT "D"
Formeriv C-4
V. NON-CONFORMANCE
A. No field installation changes are permitted without first notifying
design consultant in writing. If in the event any sign is changed as to
placement and location which differs from plan, sign company will be
responsible to repair and relocate sign proper placement at sign
company's expense.
B. Any sign that is installed by tenant which is not in conformance to the
approved drawings shall be corrected by tenant within fifteen (15) days
after written notice by Landlord or Landlord's sign consultant. In the
event tenant's sign is not brought into conformance within said fifteen
day period, then Landlord shall have the option to correct said
sign at tenants expense.
EXHIBIT "D"
Formerly C-5
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