HomeMy WebLinkAbout2026-04-14; City Council; 05; Lease agreement with MiraCosta Community College District for the Las Palmas property, 2075 Las Palmas DriveCA Review CDS
Meeting Date: April 14, 2026
To: Mayor and City Council
From: Geoff Patnoe, City Manager
Staff Contact: Curtis M. Jackson, Real Estate Manager
curtis.jackson@carlsbadca.gov, 442-339-2836
Subject: Lease agreement with MiraCosta Community College District for the Las
Palmas property, 2075 Las Palmas Drive
District: 2
Recommended Action
Adopt a resolution authorizing the City Manager to execute a five-year lease agreement with
MiraCosta Community College District for the Las Palmas property.
Executive Summary
MiraCosta Community College Technology Career Institute is a workforce development center
offering accelerated, hands-on, low-cost training in the fields of manufacturing, technology and
engineering, including programs for machinists, drone operators and technicians. MiraCosta
Community College has been operating out of the city-owned Las Palmas property located at
2075 Las Palmas Drive continuously since July 8, 2014.
The current lease expires on Sept. 21, 2026, and MiraCosta Community College has requested
to continue operating its center at the location under a new five-year lease agreement.
The new lease agreement can only be approved by the City Council. Staff recommend the City
Council approve the lease agreement and authorize the City Manager to execute the lease.
Explanation & Analysis
Background
The Las Palmas property (Assessor parcel numbers 213-061-19-00, 213-061-27-00 and 213-061-
28-00) is located on the south side of Las Palmas Drive, just east of the intersection of Camino
Vida Roble and Las Palmas Drive. Originally built in 1985, the 22,627-square-foot building served
as the city’s Development Services Center from 1986 until 2001, when city staff moved to the
larger Faraday Administration Center building.
•The City Council on July 8, 2014, approved a six-year lease agreement with MiraCosta
Community College for the Las Palmas building and associated parking lot.
•MiraCosta Community College used the space to operate its Technology Career
Institute, which provided accelerated technical training and certificate programs, and its
Small Business Development Center, which offered professional business consulting and
resources to help small businesses.
April 14, 2026 Item #5 Page 1 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
•The City Council on Sept. 21, 2021, authorized a second five-year lease agreement,
which allowed operations to continue.
•A few years into the lease agreement, the City Council on May 9, 2023, at the request of
MiraCosta Community College, approved an amendment to the lease eliminating the
Small Business Development Center programming and added welding and craft brewing
technician programs to the curriculum.
MiraCosta Community College currently offers a range of vocational programs, including
engineering technician, machinist technology, unmanned systems technology, biomedical
equipment technician, welding technology and craft brewing technology, as well as additional
workforce certificate programs, as shown in the Operational Guidelines attached as Exhibit C to
the lease. The center has supported hundreds of students annually and continues to meet
regional workforce needs.
Proposed lease agreement
MiraCosta Community College notified the city in November 2025 of its desire to enter into a
new five-year lease agreement to continue its existing operations on the property. The
proposed lease agreement provides for an initial term of five years and includes two additional
five-year extension options that may be exercised by the tenant, subject to city approval, for a
maximum term of fifteen years.
The proposed lease continues the same rent structure from the 2021 agreement. The current
rental amount reflects the original agreed-upon rate as adjusted annually by the 5.5% escalator,
and that annual increase will continue going forward. This structure was designed to allow the
city’s rent to move progressively closer to market levels over time while maintaining
predictability for the tenant.
Like the current lease agreement, MiraCosta Community College will remain responsible under
the new agreement for utilities, possessory interest taxes, if any, interior building maintenance
and insurance under the proposed lease agreement.1 The city will retain responsibility for the
parking lot and fire suppression systems, similar to the terms in the current agreement.
The structure of this lease agreement provides operational stability for MiraCosta Community
College while preserving long-term flexibility for the city. Following the initial five-year term,
either party may terminate the agreement with 365 days’ written notice.
Surplus Land Act
The proposed lease agreement is not subject to the Surplus Land Act (Government Code
Section 54220 et seq.), which requires cities to make surplus property available for prioritized
public uses, such as affordable housing, before selling or leasing it on the open market.2
The Las Palmas property has not been declared surplus and continues to be used for a public
workforce development purpose. In addition, the law does not apply to leases of 15 years or
less that do not allow residential development. This lease meets those criteria.
1 Possessory interest taxes are property taxes levied on private individuals or businesses that lease, rent, or use
publicly owned, tax-exempt land or facilities, such as government-owned property.
2 Et seq, or et sequentes, means all of the codes in the section, not just the one cited.
April 14, 2026 Item #5 Page 2 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
Fiscal Analysis
The total projected revenue over the initial five-year term is approximately $521,360.
Year of agreement Projected rent revenue
1 $93,415
2 $98,553
3 $103,973
4 $109,692
5 $115,725
TOTAL $521,358
The lease revenue from this property is recorded in the Public Facilities Fee Fund, because the
property was originally acquired using Public Facilities Fee funds.
Next Steps
MiraCosta Community College District and city staff will carry out the terms of the lease
agreement.
Environmental Evaluation
The proposed action is categorically exempt from environmental review under California
Environmental Quality Act, or CEQA, Guidelines Section 15301 because it involves the leasing,
operation, maintenance and minor alteration of existing facilities with negligible or no
expansion of the existing or former use. No exceptions to the categorical exemption as set forth
in CEQA Guidelines Section 15300.2 or Carlsbad Municipal Code Section 19.04.070(C) apply.
Exhibit
1. City Council resolution
April 14, 2026 Item #5 Page 3 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
Exhibit 1
RESOLUTION NO. 2026-072 .
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD,
CALIFORNIA, AUTHORIZING THE CITY MANAGER TO EXECUTE A FIVE-YEAR
LEASE AGREEMENT WITH MIRACOSTA COMMUNITY COLLEGE DISTRICT FOR
THE LAS PALMAS PROPERTY
WHEREAS, on July 8, 2014, the City Council adopted Resolution No. 2014-171 authorizing a six-
year lease agreement with MiraCosta Community College District for the city-owned property located
at 2075 Las Palmas Drive (Assessor parcel numbers 213-061-19-00, 213-061-27-00 and 213-061-28-00);
and
WHEREAS, on Sept. 21, 2021, the City Council adopted Resolution No. 2021-211 authorizing a
new lease agreement for the property; and
WHEREAS, on May 9, 2023, the City Council adopted Resolution No. 2023-123 approving
Amendment No. 1 to the lease agreement which eliminated the Small Business Development Center
and added a Craft Brewing Technician program; and
WHEREAS, MiraCosta Community College District has continuously operated workforce
development and industry-recognized certificate programs at the property since 2014; and
WHEREAS, the current lease agreement expires in June 2026 and MiraCosta Community College
District has requested to enter into a new five-year lease agreement to continue its operations at the
property; and
WHEREAS, the proposed lease agreement provides for an initial term of five-years and includes
two five-year extension options, and contains termination provisions that preserve the city’s long-term
planning flexibility; and
WHEREAS, the proposed lease agreement includes termination provisions that preserve the
city’s long-term planning flexibility, including the ability for either party to terminate the agreement
following the initial five-year term with 365 days’ written notice, and the city’s right to terminate the
tenant’s use of the upper parking lot area with 30 days’ written notice; and
WHEREAS, the City Council has determined that approval of the lease agreement is in the best
interest of the City of Carlsbad; and
WHEREAS, this lease agreement is before the City Council for review and approval because the
City Council has not delegated authority to enter into or amend lease agreements to the City Manager.
April 14, 2026 Item #5 Page 4 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California, as
follows:
1.That the above recitations are true and correct.
2.The proposed action is categorically exempt from environmental review under
California Environmental Quality Act, or CEQA, Guidelines Section 15301 because it
involves the leasing, operation, maintenance and minor alteration of existing facilities
with negligible or no expansion of the existing or former use. No exceptions to the
categorical exemption as set forth in CEQA Guidelines Section 15300.2 or Carlsbad
Municipal Code Section 19.04.070(C) apply.
3.That the City Manager is hereby authorized to execute the Lease Agreement with
MiraCosta Community College District (Attachment A), and to act on behalf of the City
of Carlsbad in all future decisions and actions necessary to implement the Lease
Agreement with MiraCosta Community College District for use of city-owned property
at 2075 Las Palmas Drive, including any extension options, and to do so in full
compliance with the terms and conditions expressed in the aforementioned Agreement
and to the satisfaction of the City Attorney
PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City of
Carlsbad on the 14th day of April, 2026, by the following vote, to wit:
AYES: Blackburn, Bhat-Patel, Acosta, Burkholder, Shin.
NAYS: None.
ABSTAIN: None.
ABSENT: None.
______________________________________
KEITH BLACKBURN, Mayor
______________________________________
SHERRY FREISINGER, City Clerk
(SEAL)
April 14, 2026 Item #5 Page 5 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
-1 -
LEASE AGREEMENT
Lease
________________________, 2026, by and between CITY OF CARLSBAD, a California municipal
Landlord MIRACOSTA COMMUNITY COLLEGE DISTRICT Tenant ) and shall
be effective and binding upon the parties hereto as of the date of execution hereof by both
parties Parties .
R E C I T A L S
WHEREAS, Landlord is the owner of certain real property and improvements thereon,
consisting of approximately 22,627 square feet and parking, located at 2075 Las Palmas Drive in
the City of Carlsbad, including APNs 213-061-19-00, 213-061-27-00, and a portion of APN (APN
213-061-28-00, and more particularly described and/or depicted on Exhibit A and A-1 attached
hereto Premises
WHEREAS, the Parties previously entered into an initial Lease Agreement, dated July 17,
2014, for the purpose of operating a Technology Career Institute and Small Business
Development Center on the Premises, which expired on July 16, 2019; and
WHEREAS, the Parties thereafter entered into that Lease Agreement, dated September
21, 2021, to continue to operate a Technology Career Institute and Small Business Development
Center on the Premises, which expires on September 21, 2026; and
WHEREAS, on May 9, 2023, City Council approved amendment No. 1 to the Lease
Agreement to eliminate their Small Business Development Center programming and adding two
new welding and craft brewing technician programs, and
WHEREAS, Tenant desires to continue leasing the Premises, for the purpose of operating
a Technology Career Institute; and
WHEREAS, Landlord is willing to lease the Premises to Tenant for the term and upon the
covenants, conditions and provisions hereinafter set forth.
A G R E E M E N T
NOW THEREFORE, in consideration of the covenants, conditions and provisions
contained herein, the parties hereto do mutually agree as follows:
Attachment A
April 14, 2026 Item #5 Page 6 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
April 15
-2 -
ARTICLE 1
BASIC LEASE PROVISIONS
1.1 Trade Name. MiraCosta Community College District Trade Name
1.2 Premises. The Premises (defined above) are commonly known as 2075
Las Palmas Drive, Carlsbad, California, 92011, and consist of a commercial building with
approximately 22,627 square feet of indoor space and related improvements, and the adjacent
Upper Parking Lot Area.
1.3 Term and Rent Commencement. The Term shall be five (5) years
commencing on September 22, 2026
sooner terminated in accordance with this Lease, on September 21, 2031
paying rent on the Term Commencement Date Rent Commencement Date
however, that concurrently with the execution of this Lease, Tenant shall pay to Landlord the
Base Rent for the first (1st) full month beginning on the Rent Commencement Date. As used in
Lease Year during the
Term commencing with the Rent Commencement Date.
1.4 Base Rent.
Lease Year Months* Base Rent Per Month Annual Base Rent
1 1 12 $7,784.60 $ 93,415.22
2 13 24 $8,212.76 $ 98,553.06
3 25 36 $8,664.46 $103,973.48
4 37 48 $9,141.00 $109,692.02
5 49 60 $9,643.76 $115,725.08
*From the Rent Commencement Date
1.5 Percentage Rent. NA
1.6 Use of Premises. The Premises shall be used only for the purpose of
operating a Technology Career Institute Permitted Use
1.7 Tenant Improvement Allowance. NA
1.8 Security Deposit. NA
1.9 Guarantor: NA
1.10 Broker(s): NA
April 14, 2026 Item #5 Page 7 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
-3 -
1.11 :
MiraCosta Community College District
Elba Gomez
Assistant Superintendent/VP of Administrative Services
1 Barnard Drive
Oceanside, CA 92056
Email: elba.gomez@miracosta.edu
1.12 :
City of Carlsbad
Real Estate Manager
1635 Faraday Avenue
Carlsbad, CA 92008
1.13 :
Finance Department
City of Carlsbad
1635 Faraday Avenue
Carlsbad, CA 92008
This Article 1 is intended to supplement and/or summarize the provisions set forth in the
balance of this Lease. If there is any conflict between any provisions contained in this Article 1
and the balance of this Lease, the balance of this Lease shall control.
ARTICLE 2
PREMISES
2.1 Lease of Premises. Landlord leases to Tenant and Tenant hires from
Landlord the Premises described in Article 1 for the Term (as defined in Article 3 below) and
pursuant to all of the terms, covenants and conditions contained herein. Any statement of
square footage set forth in this Lease, or that may have been used in calculating Base Rent, is
an approximation which Landlord and Tenant agree is reasonable and the Base Rent based
thereon is not subject to revision whether or not the actual square footage is more or less.
2.2 Condition of the Premises. Tenant acknowledges that except as
representation, warranty or any improvements by Landlord. Landlord makes no
representations or warranties with respect to this Lease, the Premises or any property therein
or with respect to any matter related thereto, other than as expressly set forth in this Lease.
April 14, 2026 Item #5 Page 8 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 4 -
Tenant hereby acknowledges that it has had an opportunity to investigate and inspect the
hereby (a) waive and disclaim any objection to, cause of action based upon, or claim that its
obligations hereunder should be reduced or limited because of the condition of the Premises or
good, clean and sanitary order and repair and by taking possession Tenant accepts the Premises
as it exists. Tenant acknowledges that neither Landlord nor any agent nor any employee of
Landlord has made any representations or warranty with respect to the Premises or with
warrants and represents that Tenant has relied solely on its own investigation and inspection of
and is not relying on any statements, representations or warranties whatsoever made by or
enforceable directly or indirectly against Landlord relating to the condition, operations,
dimensions, descriptions, soil condition, suitability, compliance or lack of compliance with any
state, federal, county or local law, ordinance, order, permit or regulation, or any other attribute
or matter of or relating to the Premises. No promise of Landlord to alter, remodel, repair or
improve the Premises, and no representation, express or implied, respecting any matter
relating to the Premises or this Lease (including, without limitation, the condition of the
Premises) has been made to Tenant by Landlord or any agent of Landlord other than as may be
contained herein.
2.3 Delivery of Possession. Tenant shall accept possession of the Premises
from Landlord on the Term Commencement Date; provided, however, that Tenant shall not be
entitled to possession of the Premises until Landlord has received from Tenant all of the
following: (i) the first monthly installment of Base Rent for the first (1st) full month after the
Rent Commencement Date; and (ii) executed copies of policies of insurance or certificates or
binders thereof as required under Article 9 below. Tenant shall pay to Landlord, upon its
execution of this Lease, the sums specified in clause (i) above. If Tenant is unable to obtain
possession of the Premises because one (1) or more of the above items are not received by
Completion Date (as hereinafter defined) and the Rent Commencement Date shall not be
affected or delayed thereby.
2.4 Easements. Landlord reserves to itself the right, from time to time, to
grant such easements, rights and dedications affecting all or any part of the Premises as
Landlord deems necessary or desirable, and to cause the recordation of parcel and subdivision
maps and restrictions affecting all or any part of the Premises, so long as such easements,
rights, dedications, maps and restrictions do not materially and/or unreasonably interfere with
material default under this Lease. Tenant shall cooperate with and not oppose or object to
d parcelization of all or any part of the
Premises and any property adjacent to the Premises so long as such actions by Landlord do not
.
April 14, 2026 Item #5 Page 9 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
-5 -
2.5 Existing Equipment. Landlord hereby grants Tenant the right to use any
Existing Equipment
of the Premises and located within the Premises on the Term Commencement Date. Tenant
representation or warranty by Landlord. Said right shall be coterminous with this Lease and
upon such termination, the Existing Equipment shall be deemed to constitute part of the
Premises and surrendered by Tenant to Landlord in good condition and repair, ordinary wear
and tear and damage from casualty excepted.
ARTICLE 3
TERM
3.1 Term. The Term of this Term
Commencement Date and shall expire, unless sooner terminated in accordance with this Lease,
shall promptly execute a Memorandum of Term Commencement in the form attached hereto
as Exhibit B, which shall specify the Term Commencement Date, Rent Commencement Date
and the Expiration Date. If Tenant fails to execute a Memorandum of Term Commencement,
of the Rent Commencement Date.
3.2 Extension Option. Landlord hereby grants to Tenant two (2) options to
Extension Term
upon the expiration of the Term or prior Extension Term, as applicable. Each such option shall
be exercisable only if Tenant is not then in default under this Lease and no event has occurred
which, with notice or the passage of time or both, would constitute a default by Tenant under
this Lease. Each such option shall be exercisable by Tenant by delivery of written notice to
commencement of the applicable Extension Term, but not more than two hundred seventy
(270) days prior to the commencement of the applicable Extension Term. Notwithstanding the
foregoing, Landlord shall have the right to disapprove such extension if such extension would
Disapproval Notice
extend as to the applicable Extension Term and any future Extension Term shall forever
terminate and be of no further force or effect. In the event Tenant exercises an option to
extend and Landlord does not deliver a Disapproval Notice, the Term and all of the terms and
conditions of this Lease shall continue in full force and effect to the end of the applicable
Extension Term, except that the Base Rent shall be adjusted as follows:
April 14, 2026 Item #5 Page 10 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
-6 -
(a) Base Rent for the first twelve (12) months of each Extension Term
shall be one hundred and five and one half percent (105.5%) of the monthly Base Rent
applicable immediately prior to the commencement of such Extension Term, and Base Rent
shall increase every twelve (12) full calendar months thereafter by five and one-half percent
(5.5%).
3.3 Surrender of Premises. On the Expiration Date or on the sooner
peaceably surrender the Premises in accordance with the terms of this Section and in good
order, condition and repair, broom clean and free of debris, excepting only ordinary wear and
tear. "Ordinary wear and tear" shall not include any damage or deterioration that would have
been prevented by good maintenance practice. Notwithstanding any other provision hereof,
Tenant shall not remove (unless requested to by Landlord, in which case Tenant shall remove)
which cannot be removed without material damage to the Premises. If Landlord so elects, such
items shall remain upon and be surrendered with the Premises as a part thereof, without
charge, at the expiration or termination of this Lease and shall then become the property of
Landlord. Tenant shall repair, to the satisfaction of Landlord, any damage to the Premises
caused by any removal, or by the use of the Premises or by any failure of Tenant to comply with
the terms of this Lease (including, without limitation, provisions relating to Hazardous
Substances). Tenant shall promptly surrender all keys for the Premises to Landlord at the place
then fixed for notices to Landlord and shall inform Landlord of the combinations on any locks
and safes on the Premises. The provisions of this Section shall survive termination of this Lease.
3.4 Holding Over. Tenants have no right to retain possession of the
Premises or any part thereof beyond the expiration or termination of this Lease. The failure of
Tenant to timely surrender the Premises in the condition required by Section 3.3 above shall
constitute a holdover and shall not be considered a renewal of this Lease or an extension of the
Term. In the event of any such holdover Base Rent shall immediately be increased to an
amount equal to 150% of the Base Rent applicable during the month immediately preceding
the expiration or termination. In addition to paying Landlord the increased Base Rent, Tenant
shall defend, indemnify, protect and hold Landlord harmless from and against all claims,
loss, cost or damages, including lost profits and loss of good will claimed by any prospective
tenant of the Premises, and (b)
rescinding or refusing to enter into the prospective lease of the Premises as a direct or indirect
consent shall be construed as consent by Landlord to any holding over by Tenant.
3.5 Waiver of Relocation Benefits. Tenant understands this Lease is
entered into for a specified period of time. Tenant therefore waives any and all relocation
April 14, 2026 Item #5 Page 11 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
-7 -
benefits defined in the California Relocation Assistance Law (Government Code, Section 7260,
et. seq.).
ARTICLE 4
RENT
4.1 General Provisions (defined
below). Unless provided herein to the contrary, Tenant shall pay all rent to Landlord at
Landlord in lawful money of the United States of America without demand therefor, and
without deduction, offset or abatement of any kind, except as may be expressly provided for in
this Lease. Rent for any partial month shall be prorated on the basis of a thirty (30) day month.
Tenant assumes all risk of loss if payments are made by mail.
4.2 Payment of Base Rent. For each month or partial month of the Term
commencing on the Rent Commencement Date (except as otherwise expressly provided
Base Rent
in advance as set forth herein. Tenant shall pay the first installment of Base Rent to Landlord
Rent shall be payable in advance on or before the monthly anniversary of the Rent
Commencement Date.
4.3 Additional Rent. NA
ARTICLE 5
SECURITY DEPOSIT
5.1 Security Deposit
Tenant shall deposit with Landlord the security deposit, if any, Security
Deposit
of all the terms, covenants, and conditions of this Lease. Landlord shall not be required to keep
and earnings on the Security Deposit. Tenant shall not be entitled to any interest on the
accordance with this Section, the parties acknowledge that the Security Deposit does not cover
any rent hereunder. In the event of a sale of the Premises or assignment of this Lease by
Landlord to any person other than a mortgagee, Landlord shall have the right to transfer the
Security Deposit to its vendee or assignee, subject to Tenant's aforesaid rights upon
termination, and thereupon Landlord shall be released and relieved from any liability with
respect to the return of such Security Deposit to Tenant, such vendee or assignee to be solely
responsible to Tenant therefor.
April 14, 2026 Item #5 Page 12 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 8 -
5.2 Use of Security Deposit. If Tenant breaches or fails to perform any of
use or retain all or any part of the Security Deposit to cure the breach or failure of performance,
and to compensate Landlord for any damages sustained by Landlord, including but not limited
to payment of: (i) delinquent rent; (ii) interest on delinquent rent; (iii) late charges on
delinquent rent; (iv) the
cost of repairing damages to the Premises; (vi) the cost of cleaning, maintaining, repairing,
interest on any and all
Remedy Rate
provided, however, that retention of all or any part of the Security Deposit shall not affect
in equity, or under this Lease; and provided, further, that in the event that Landlord elects to
apply the Security Deposit or any portion thereof as herein provided, such application and the
amounts applied to particular items of cure and/or compensation shall be determined by
used as provided for in this Section, then within 10 days after written demand by Landlord,
Tenant shall deposit with Landlord sufficient cash to restore the Security Deposit to its original
5.3 Refund and Transfer; Waiver of Statutes. If Tenant shall have fully and
received invoices for such repair or cleaning costs, if any, and after Landlord has inspected
the Premises, then Landlord shall return the Security Deposit or any balance thereof to
Tenant. Landlord may transfer the Security Deposit, or that portion remaining after any
-in-interest and shall upon such transfer be discharged
from any further liability with respect to such Security Deposit. Tenant hereby waives (i)
California Civil Code Section 1950.7, as amended or recodified from time to time, and any
and all other laws, rules and regulations, now or hereafter in force, applicable to security
Security Deposit Laws
duties and obligations Landlord may now or, in the future, will have relating to or arising
from the Security Deposit Laws. Notwithstanding anything to the contrary contained
herein, the Security Deposit may be retained and applied by Landlord (a) to offset rent
which is unpaid either before or after the termination of this Lease, and (b) against other
damages suffered by Landlord before or after the termination of this Lease, whether
foreseeable or unforeseeable, caused by the act or omission of Tenant or any officer,
employee, agent or invitee of Tenant.
ARTICLE 6
TAXES
6.1 Real Estate Taxes. Tenant shall pay directly prior to delinquency any and
all real estate taxes, assessments (whether general, special, ordinary or extraordinary),
April 14, 2026 Item #5 Page 13 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 9 -
possessory interest taxes, improvement bonds, license fees, commercial rental taxes, sewer
and water rents and other levies, fees and charges of every kind imposed by any authority
having the direct or indirect power to so tax, levy or assess, to the extent relating to the
other activities of Tenant upon or in connection with the Premises. In particular, Tenant
acknowledges that this Lease may result in a taxable possessory interest. Tenant shall be solely
responsible for payment of property taxes associated with its occupancy of the Premises, if any
apply. Tenant shall also pay any fees imposed by law for licenses or permits for any business or
activities of Tenant upon the Premises or under this Lease.
6.2 Personal Property Taxes. Tenant shall pay directly prior to delinquency any
and all taxes and assessments levied or assessed during the Term upon or against (i)
Property (as hereinafter defined), furniture, equipment, and any other personal property
installed or located in the Premises and (ii) all above-standard alterations, additions,
betterments, or improvements of whatever kind or nature made by Tenant to the Premises
that are separately assessed.
ARTICLE 7
UTILITIES
7.1 Payment of Utilities. Tenant shall pay, before delinquency, for all utilities
and services serving the Premises, including (without limitation) trash collection, water, gas and
electricity, and any and all utility hook-up fees, connection fees, including sewer connection
fees, and service and other charges for the availability of any such utilities and services,
supplied to or consumed in or upon the Premises from and after the Term Commencement
Date and continuously thereafter throughout the Term, directly to the supplier of such utilities
utilities supplied to the Premises for the past twelve (12) month period within thirty (30) days
7.2 Interruption of Utilities. Landlord shall have the right (but not the
obligation), with 72-hours prior written notice to Tenant, or without notice in the case of an
emergency, to shut off water, gas, electricity and any all other utilities and services whenever
such discontinuance is necessary to make repairs or alterations or to protect the Premises. In
no event shall Landlord be liable for the quality, quantity, failure or interruption of any such
utilities or services to the Premises except to the extent caused by Landlord. In addition, any
such failure, interruption or impairment shall not be construed as an eviction of Tenant or a
Notwithstanding the foregoing or any language in this Lease to the contrary, except in the
event of an act of Force Majeure, if any utility service to the Premises is interrupted more than
three (3) consecutive days solely due to the negligent or intentional act of Landlord or
Landlord's employees, and as a result, Tenant discontinues all business operations in the
Premises, Tenant shall have the right to abate all Base Rent payable hereunder for the period
for which such interruption and discontinuation exist. In the event of any such interruption of
April 14, 2026 Item #5 Page 14 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 10 -
any utility service to the Premises, Landlord shall use due diligence to restore promptly such
service.
ARTICLE 8
INSURANCE
8.1 General. Tenant shall, at its expense, maintain in effect from and after the
Term Commencement Date and continuously thereafter until the termination or expiration of
this Lease, the policies of insurance required under this Article. All policies that Tenant is
required to obtain under this Article shall be issued by companies licensed to do business in
-
less than Class
shall be in a form (without any additions or deletions unless approved in writing by Landlord)
and underwritten by companies acceptable to Landlord. On or before the Term
Commencement Date, Tenant shall furnish Landlord with certificates and endorsements in a
form acceptable to Landlord evidencing that (i) the policies (or a binder thereof) required
pursuant to this Article are in effect and (ii) Landlord shall be notified in writing thirty (30) days
prior to cancellation, material change, or nonrenewal of such insurance. The policies that
Tenant is required to obtain pursuant to this Article shall name Landlord, and any other parties
requested by Landlord, as additional insureds, or as loss payee (as applicable) for property
which Landlord has an insurable interest and shall be primary policies, and shall not be
contributing with and shall be in excess of coverage which Landlord may have and shall be
unaffected by any insurance or self-insurance Landlord may have regardless of whether any
other insurance names Landlord as an insured or whether such insurance stands primary or
secondary. If Tenant carries any of the insurance required hereunder in the form of a blanket
policy, any certificate required hereunder shall make specific reference to the Premises. The
procuring of policies of insurance shall not be construed to limit Tenant's liability hereunder in
any way, nor to fulfill the indemnification provisions and requirements of this Lease. Tenant
agrees not to use the Premises in any manner, even if use is for purposes stated herein, that
will result in the cancellation of any insurance Landlord may have on the Premises, or on
adjacent premises, or that will cause cancellation of any other insurance coverage for the
Premises, or adjoining premises. Tenant further agrees not to keep on the Premises or permit
to be kept, used, or sold thereon, anything prohibited by any fire or other insurance policy
covering the Premises. Tenant shall, at its sole cost and expense, comply with any and all
requirements, in regard to Premises, of any insurance organization necessary for maintaining
fire and other insurance coverage at reasonable cost.
8.2 Commercial General Liability Insurance. Tenant shall obtain and keep in
force a policy or policies of commercial general liability insurance covering the Premises and the
business operations thereon, including contractual liability, personal injury and property
liability coverage in amounts not less than a combined single limit of $1,000,000 per occurrence
for bodily injury, personal injury, death and property damage liability. If the submitted policies
contain aggregate limits, general aggregate limits will apply separately under this Lease or the
general aggregate will be twice the required per occurrence limits. Liability coverage for the
April 14, 2026 Item #5 Page 15 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 11 -
required limits may be obtained with a combination of commercial general liability insurance
and an umbrella policy. Such policy or policies shall include liquor liability coverage in the same
alcoholic beverages is permitted in the Premises.
8.3 Property and Extended Coverage Insurance. Tenant shall obtain and keep
in force a Causes of Loss -
(business interruption) insurance rider or endorsement attached thereto. Tenant shall keep in
force a policy of plate glass insurance covering all plate glass in the Premises in an amount
equal to the full replacement cost thereof. The deductibles on such policies shall not exceed
$1,000.00 per occurrence. The proceeds from any such insurance shall be used by Tenant for
the replacement of personal property and trade fixtures as well as alterations and utility
installations.
8.4 Business Interruption. Tenant shall obtain and keep in force loss of
income and extra expense insurance in amounts as will reimburse Tenant for at least twelve
against by prudent tenants in the business of Tenant or attributable to prevention of access to
the Premises as a result of such perils.
8.5 . Tenant shall obtain and keep in force
8.6 Automobile Insurance. Tenant shall obtain and keep in force
comprehensive automobile liability insurance with a combined single limit of at least
$1,000,000 per occurrence for claims arising out of any owned, non-owned or hired
automobiles.
8.7 Waiver of Subrogation. Notwithstanding anything to the contrary
contained herein, Landlord and Tenant hereby waive any rights each may have against the
other on account of any loss or damage occasioned to Landlord or Tenant, their respective
property, the Premises or its contents, arising from any risk to the extent covered by the
insurance required hereunder. The parties each, on behalf of their respective insurance
companies insuring the property of either Landlord or Tenant against any such loss, waive any
right of subrogation that it may have against Landlord or Tenant, as the case may be. Each
party shall obtain any special endorsements, if required by its insurer, whereby the insurer
waives its rights of subrogation against the other party. The foregoing waivers of subrogation
policy of insurance.
April 14, 2026 Item #5 Page 16 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 12 -
8.8 Coverage Changes. Notwithstanding any of the foregoing, Landlord shall
retain the right at any time to review the coverage, form, and amount of the insurance required
under this Lease. If, in the opinion of Landlord, the insurance provisions in this Lease do not
provide adequate protection for Landlord and/or for members of the public using the Premises,
Landlord may require Tenant to obtain insurance sufficient in coverage, form and amount to
designed to assure protection from and against the kind and extent of risk, which exist at the
time a change in insurance is required. Landlord shall notify Tenant in writing of changes in the
insurance requirements and, if Tenant does not deposit certificates/endorsements evidencing
acceptable insurance policies with Landlord incorporating such changes within thirty (30) days
of receipt of such notice, this Lease shall be in default without further notice to Tenant, and
Landlord shall be entitled to all legal remedies.
ARTICLE 9
USE OF PREMISES
9.1 Permitted Use and Continuous Operation. Tenant shall actively and
continuously use, operate and occupy the Premises solely for the Permitted Use, and shall be
open to the public during Tenant's Business Hours. No other use shall be permitted without the
prior express written consent of Landlord. Tenant shall identify itself to the public in connection
with such business under Tenant's Trade Name specified in Article 1 above and under no other
name without Landlord's prior express written consent. Notwithstanding anything to the
contrary contained in this Lease, with prior written notice to Landlord, the Premises may be
closed to the extent reasonably necessary due to Force Majeure.
Tenant and Landlord agree on a written annual Operational Guidelines regarding the general
parameters of Tenants use and occupation of the Premises, attached hereto as Exhibit C. The
Operational Guidelines may be amended annually by the Landlord within thirty {30} days after
December 31 of each calendar year.
9.2 Conduct of Business. Tenant shall conduct its business at all times in a
first-class, professional and businesslike manner consistent with reputable business standards
and practices.
9.3 Compliance with Laws; Nuisance. Tenant shall, at its sole expense and at
all times, comply fully with (i) all federal, state and municipal laws, including without limitation
all zoning and land use laws and ordinances, conditional use permit rules and orders and the
Liquor Licenses, now in force or which may hereafter apply to the Premises or which impose
any duty on Landlord or Tenant relating to the use or occupancy of the Premises, including but
not limited to the obligation to obtain a conditional use permit, alter, maintain, repair or
restore the Premises in compliance and conformity with all such laws, rules and orders, (ii) any
declaration of covenants, conditions and restrictions and easements encumbering the
Rules and
April 14, 2026 Item #5 Page 17 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 13 -
Regulations
organization or company necessary for the maintenance of reasonable fire and public liability
insurance covering the Premises. Tenant shall neither store, use or sell any article in or about
the Premises, nor permit any act, that would cause the premiums for insurance to increase or
cause a cancellation of any policy upon the Premises. Tenant shall not occupy, suffer or permit
the Premises or any part thereof to be used for any illegal, immoral or dangerous purpose, or in
any other way contrary to the law or the rules or regulations of any public authority. Tenant
shall not commit, or suffer to be committed, any waste upon the Premises, or any public or
private nuisance, or any other act or thing which may disturb the quiet enjoyment of neighbors
of the Premises. Tenant shall not conduct or permit to be conducted any sale by auction in,
upon or on the Premises.
9.4 Environmental Compliance. Tenant represents, warrants and covenants
to Landlord that Tenant shall at no time use, or permit the Premises to be used, in violation of
any federal, state or local law, ordinance or regulation relating to the environmental conditions
on, under or about the Premises, including, but not limited to, air quality, soil and surface and
subsurface water conditions. Tenant shall assume sole and full responsibility and cost to
remedy any such violations. Tenant further represents, warrants and covenants to Landlord
that Tenant shall not cause or permit any Hazardous Substance to be spilled or released in, on,
under or about the Premises (except for supplies typically used in the ordinary course of
operating a brewery in commercially reasonable amounts and in strict compliance with law)
and shall promptly, at Tenant's expense, take all investigatory and/or remedial action required
by any governmental entity with jurisdiction over the Premises for the cleanup of any
contamination of, and for the maintenance, security and/or monitoring of the Premises or
neighboring properties, that was caused or materially contributed to by Tenant, or pertaining to
or involving any Hazardous Substance brought onto the Premises during the term of this Lease,
by or for Tenant, or any third party but only to the extent such third under the control of
Tenant. In no event shall Tenant be responsible for any contamination of Hazardous Substance
that existed or caused by Landlord or any third
. The term "Hazardous
Substance" as used in this Lease shall mean any product, substance, or waste whose presence,
use, manufacture, disposal, transportation, or release, either by itself or in combination with
other materials expected to be on the Premises, is either: (i) potentially injurious to the public
health, safety or welfare, the environment or the Premises, (ii) regulated or monitored by any
government authority, or (iii) a basis for potential liability of Landlord to any governmental
agency or third party under any applicable statute or common law theory. Hazardous
Substances shall include, but not be limited to, asbestos, asbestos containing material, the
group of organic compounds known as polychlorinated biphenyls, as well as substances defined
regulations, as they be enacted or promulgated from time to time.
9.5 . Landlord, with 72-hours prior written notice
to Tenant, may go into the Premises for the purposes of: (i) inspecting the Premises;
(ii) inspecting the performance by Tenant of the terms and conditions hereof; (iii) showing the
April 14, 2026 Item #5 Page 18 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 14 -
Premises to prospective tenants, purchasers, partners, or mortgagees; and (iv) posting notices
for the protection of Landlord on the Premises. Except in the case of an emergency in which
entry into the Premises is necessary to protect the Premises, Landlord shall give Tenant written
notice of any and all intended entries or inspections pursuant to this Section.
9.6 Prohibition Against Discrimination. Tenant shall not discriminate against
or segregate any person or class of persons by reason of sex, color, race, religion or national
origin. If the use provided for in this Lease allows Tenant to offer accommodations or services
to the public, such accommodations or services shall be offered by Tenant to the public on fair
and reasonable terms.
ARTICLE 10
MAINTENANCE AND REPAIR OF PREMISES
10.1 .
as further provided in Section 2.2 above, and Tenant expressly waives all implied warranties
including implied warranties of merchantability and fitness, if any. Tenant hereby waives all
rights under Sections 1941 and 1942 of the California Civil Code, as amended or recodified from
time to time, or any similar provision, permitting Tenant to make repairs at the expense of
Landlord. Tenant represents and warrants that it has inspected of the Premises, and that it is
familiar with the condition of the Premises. Tenant understands and acknowledges that the
Premises may be subject to earthquake, fire, floods, erosion, high water table, dangerous
underground soil and water conditions and similar occurrences that may alter its condition or
affect its suitability for any proposed use. Landlord shall have no responsibility or liability with
respect to any such occurrence.
10.2 . From and after the Term Commencement Date
and continuously thereafter until the expiration or termination of this Lease, Tenant, at
-class order and neat, clean and
sanitary condition, including, (a) maintenance and repair of all equipment or facilities
exclusively serving the Premises, such as plumbing, heating, air conditioning, ventilating,
electrical, lighting facilities, boilers, fired or unfired pressure vessels, fire hose connections if
within the Premises, fixtures, interior walls, interior surfaces of exterior walls, ceilings, floors,
windows, doors, plate glass, and skylights, but excluding any items which are the responsibility
of Landlord as set forth below. If Tenant fails to perform Tenant's obligations under this
Paragraph, Landlord may, enter upon the Premises after ten (10) days' prior written notice to
Tenant (except in the case of an emergency, in which case no notice shall be required), perform
such obligations on Tenant's behalf, and put the Premises in good order, condition and repair,
and (b) keeping the Premises free and clear of trash, garbage and other fire hazards. The
maintenance, repair and replacement obligations set forth in this paragraph are a material part
of the consideration for this Lease. Landlord warrants and represents that the heating, and air-
and will remain so for the initial twelve (12) months of the term of this Lease, ordinary wear
and tear and negligence of Tenant excepted; in the event that any such systems and/or
April 14, 2026 Item #5 Page 19 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 15 -
equipment fail during said twelve-month period, the cost to repair or replace shall be the sole
responsibility of Landlord and no portion of such cost will be passed through to Tenant.
10.3 . Landlord shall keep in good order, condition and
repair the foundations, exterior walls, structural condition of interior bearing walls, exterior
roof, fire sprinkler and/or standpipe and hose (if located in the common areas) or other
automatic fire extinguishing system including fire alarm and/or smoke detection system and
equipment, fire hydrants, parking lots, walkways, parkways, landscaping, fences, signs and
utility systems serving the common areas and all parts thereof.
10.4 . Landlord shall have the right with 72-hours written
prior notice, but not the duty, to enter, view, inspect, determine the condition of and protect
its interests in, the Premises. If at any time Landlord determines that the Premises are not in
the condition required by this Lease, then Tenant shall perform the necessary maintenance,
repair and/or replacement work within ten (10) days after written notice from Landlord. If
Tenant fails to perform the necessary maintenance, repair and/or replacement work within ten
(10) days after written notice from Landlord, then Landlord may, but is not obligated to,
arise by reason thereof. Tenant shall reimburse Landlord on demand in an amount equal to the
this section shall not create any obligations or increase any obligations for Landlord elsewhere
in this Lease.
ARTICLE 11
ALTERATIONS AND ADDITIONS
11.1 Tenant Improvements. Tenant shall not make (i) any alterations,
improvements, additions or utility installations, including without limit, carpeting, floor or
window coverings, locks, air lines, power panels, electrical distribution systems, lighting
fixtures, space heaters, air conditioning and plumbing in, on, or about the Premises or (ii) any
sole expense and shall also have the right to declare Tenant in default and to terminate this
applicable federal, state and municipal laws, ordinances, regulations, codes and other
and expense, take all actions now or hereafter necessary to ensure such compliance.
Tenant Improvements that Tenant would like to make with proposed detailed plans. Landlord
April 14, 2026 Item #5 Page 20 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 16 -
Work or the Tenant Improvements from appropriate governmental agencies; (ii) furnishing a
copy of such building permit and evidence of such compliance to Landlord prior to the
commencement of such work; (iii) complying with all the conditions of such building permit and
such building and planning laws and regulations; (iv) providing Landlord with plans and
providing Landlord with a copy of the construction contract, construction schedule, trade
insurance company acceptable to Landlord, naming Landlord as an additional insured and
otherwise satisfying the requirements of Article 9 above; and/or (vii) providing Landlord with
create no responsibility or liability on the part of Landlord for their completeness, design
sufficiency, or compliance with all laws, rules and regulations of governmental agencies or
authorities. Landlord shall not be liable for any damage, loss, or prejudice suffered or claimed
by Tenant, its agents or any other person or entity on account of: (a) the approval or
disapproval of any plans, contracts, bonds, contractors, sureties or matters; (b) the construction
or performance of any work whether or not pursuant to approved plans; (c) the improvement
of any portion of the Premises or alteration or modification to any portion of the Premises; or
(d) the enforcement or failure to enforce any of the covenants, conditions and restrictions
contained in this Lease. Under no circumstances shall Tenant make any roof penetrations
without the prior written consent of Landlord. Any consent of Landlord shall be conditioned
reimburse Landlord for the cost of such inspection and any necessary repair work within ten
11.2 Construction of Tenant Improvements; Liens. Tenant shall pay when
due all claims for labor or materials furnished or alleged to have been furnished to or for
Tenant at, on, or for use in the Premises, and shall defend, indemnify, protect and hold
harmless the Premises and Landlord against the same (including, without limitation, the costs
of defending against such claims, and reasonable attorney's fees incurred therein). Tenant shall
keep the Premises and any interest therein, free and clear of all mecha
liens. Tenant shall give Landlord immediate written notice of any lien filed against the Premises
or any interest therein related to or arising from work performed by or for Tenant. Tenant shall
to post notices of non-responsibility in or upon the Premises as provided by law. If any lien or
levy of any n
to Landlord, in an amount equal to one and one-half (1 ½) times the amount of the claims upon
which such lien or levy has been filed. Such bond shall be acknowledged by Tenant as principal
April 14, 2026 Item #5 Page 21 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 17 -
and by a corporation, licensed by the Insurance Commissioner of the State of California to
transact the business of a fidelity and surety insurance company, as surety. Landlord shall have
the right to declare this Lease in default in the event the bond required by this paragraph has
not been deposited with Landlord within ten (10) days after written request has been delivered
to Tenant.
11.3 Title to Tenant Improvements. Subject to Section 13.1 below, any and all
become the property of Landlord and remain upon and be surrendered with the Premises at
the expiration of the Term without compensation to Tenant unless Landlord requires that
13
below.
11.4 Signs. Tenant shall be responsible for purchasing, installing and
set forth by the City of Carlsbad and any other sign criteria provided by Landlord (collectively,
Sign Criteria
the Sign Criteria, Tenant shall maintain such signage in good condition and repair during the
entire Term of this Lease. Tenant shall repair, at its sole cost and expense, any damage to the
Premises caused by the erection, maintenance or removal of any sign, marquee, banner,
awning, decoration or other attachment.
11.5 Compliance with Prevailing Wage Laws. Tenant acknowledges and
agrees that: (a) any construction, alteration, demolition, installation or repair work performed
under this Lease constitutes "public work" under California Prevailing Wage Law, including
Labor Code sections 1720 through 1815, et seq. (the "PWL"), and will obligate Tenant to cause
such work to be performed as a "public work," including, but not limited to, the payment of
applicable prevailing wages to the all persons or entities subject to the PWL; (b) Tenant shall
cause all persons and/ or entities performing "public work" under this Lease to comply with all
applicable provisions of the PWL; (c) Landlord is not responsible for Tenant's failure to comply
with any applicable provisions of the PWL; (d) Tenant's alleged or actual violations of the PWL
shall constitute an event of default under this Lease; and (e) Tenant shall defend and indemnify
Landlord and its officers, employees, council members and agents from and against any and all
claims, assessments, back-wages, penalties, change orders, suits, liability, judgments, damages,
proceedings, orders, directives, costs, including reasonable attorneys' fees, arising from or
relating to any actual or alleged violations of the PWL, or other application of laws, ordinances
or regulations, by any person or entity, including but not limited to Lessee, performing
construction, alteration, demolition, installation, repair and/ or any other type of work
contemplated under this Lease.
ARTICLE 12
12.1 Property. All trade fixtures, goods, inventory, merchandise,
stock, supplies, decorative light fixtures, and movable equipment owned by Tenant and
April 14, 2026 Item #5 Page 22 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 18 -
Term. Except as provided to the contrary in Section
removable from time to time and at the expiration of the Term or earlier termination thereof,
provided that: (i) Tenant shall not at such time be in default, or with notice or the passage of
time or both would be in default, under any term, covenant, condition or provision of this
Lease; (ii) Tenant shall repair to the satisfaction of Landlord, any damage to the Premises
Tenant immediately replaces any such
Premises are suitable for conducting business in accordance with Articles 5 and 10 hereof.
12.2 . Subject to the rights of Tenant, if any, under
Section 9102(4) of the California Uniform Commercial Code, as amended or recodified from
Tenant shall execute a security agreement, UCC-1 financing statement, continuation statement
and such other documents as Landlord may reasonably require to evidence, create, protect,
ARTICLE 13
DAMAGE AND DESTRUCTION
In the event of damage or destruction to the Premises by fire, the elements or
any other cause, Tenant shall, within ninety (90) days, commence and diligently pursue to
completion the repair, replacement or reconstruction of improvements necessary to permit full
use and occupancy of the Premises for the purposes provided in this Lease. Repair, replacement
or reconstruction of the Premises shall be accomplished in a manner and according to plans
approved by Landlord; provided, however, Tenant shall not be obligated to repair, reconstruct
or replace the improvements following their destruction in whole or substantial part except to
the extent the loss is covered by insurance required to be carried by Tenant pursuant to this
Lease (or would be covered whether or not such required insurance is actually in effect). If
Tenant is not obligated and elects not to restore, repair or reconstruct as herein provided, then
this Lease shall terminate and neither party shall have any further obligation to the other,
of the termination date and other provisions that survive the termination of this Lease. Tenant
hereby waives California Civil Code Sections 1932 and 1933, as amended or recodified from
time to time.
April 14, 2026 Item #5 Page 23 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 19 -
ARTICLE 14
EMINENT DOMAIN
14.1 Total or Substantial Taking. If all of the Premises are taken under the
power of eminent domain or such a substantial portion thereof is so taken that reasonable
business, this Lease shall terminate on the date that Tenant is required to yield possession to
the condemning authority, or on the date that the possession of the Premises or part thereof is
governmental power of condemnation and any private sale or other transfer in lieu of or under
threat of condemnation.
14.2 Partial Taking. If there is a partial taking of the Premises, and after
restoration of any building or other improvements, the Premises would be reasonably suitable
elect to terminate this Lease or affirm this Lease by delivering written notice to Tenant within
fifteen (15) days after any such partial taking. If Landlord fails to send any such written notice,
this Lease shall terminate on the later of the dates that possession is so taken or that Tenant or
Landlord is required to yield possession to the condemning authority. If Landlord elects to
affirm this Lease, then: (i) this Lease shall terminate as to the part taken as of the date of
transfer of possession; (ii) the rental shall be reduced in the same proportion as the square
footage of the portion of the Premises taken bears to the original square footage of the
Premises; and (iii) Landlord shall, at its own cost and expense, make all necessary repairs or
alterations to the Premises required to restore the Premises to useful condition. During such
repair or restoration, rental shall be abated proportionately as set forth above. Tenant hereby
waives any statutory rights of termination which may arise by reason of any taking of the
Premises under the power of eminent domain.
14.3 Award. Tenant hereby renounces any interest in, and assigns to
Landlord, any award made in any condemnation proceeding for any such taking, provided that
Landlord shall have no interest in or be assigned any award made to Tenant for the taking of
Tenant specifically waives any right it
may have to any compensation award representing the excess of the market value,
taken over the rent attributable thereto under the terms of this Lease.
ARTICLE 15
INDEMNIFICATION
Tenant shall indemnify, protect, defend and hold harmless Landlord and its
Landlord Parties
from and against any and all losses, damages, liabilities, actions, causes of action (whether
legal, equitable or administrative), claims, judgments, costs, and expenses (including, without
April 14, 2026 Item #5 Page 24 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 20 -
following (except to the extent caused by the gross negligence or willful misconduct of Landlord
or any of Landlord Parties): (i)
when required by this Lease, or the failure at any time of any representation or warranty of
Tenant to be true and correct; (ii) the use and operation of the Premises during the Term; or
(iii)
suppliers, engineers, architects, agents, employees, customers or invitees with respect to the
Landlord may retain its own counsel, at the expense of Tenant, to prosecute, negotiate and
defend any such claim, action or cause of action. Landlord shall have the right to compromise
or settle any such claim, action, or cause of action without admitting actual liability and without
immediately upon demand by Landlord together with interest thereon, at the Remedy Rate,
survive the expiration or termination of this Lease.
ARTICLE 16
DEFAULTS AND REMEDIES
16.1 Events of Default. The occurrence of any of the following events shall
constitute an event of default and a material breach of this Lease on the part of Tenant:
A. Abandonment or Failure to Continuously Operate
vacation or abandonment of the Premises actively and continuously use,
operate and occupy the Premises.
B. Failure to Make Payment
other sum due hereunder on the date when such payment is due, where such failure continues
(3) occasions during any twelve (12) month period to timely pay rent on or before the due date
as provided for herein (even though subsequently cured).
C. Non-Permitted Use
provision of this Lease relating to the Permitted Use, where such failure continues for ten (10)
days after written notice of such failure from Landlord.
D. Failure to Perform Other Covenants
continues for thirty (30) days after written notice of such failure from Landlord (provided,
however, if the nature of such default is such that the same cannot be reasonably cured within
a thirty (30) day period, Tenant shall not be deemed to be in default if Tenant diligently
commences such cure within such period and thereafter diligently proceeds to rectify and cure
said default), except if a different notice or cure period is specified in another provision of this
Lease.
April 14, 2026 Item #5 Page 25 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 21 -
E. Bankruptcy. The making of a general assignment for the benefit
of creditors by Tenant, or the filing of a voluntary or involuntary bankruptcy petition by or
against Tenant, or the appointment of a receiver to take possession of all or substantially all of
F. Transfer without Consent. The occurrence of any Transfer
16.2 Remedies. Upon the occurrence of an event of default by Tenant as set
forth in Section 16.1 above, Landlord shall have the following rights and remedies, in addition
to any and all other rights and remedies available to Landlord at law or in equity, including
without limit those provided under California Civil Code Sections 1951.2 and 1951.4, as
amended or recodified from time to time:
A. Terminate Lease. Landlord shall have the right to terminate this
Lease and all rights of Tenant hereunder by giving written notice to Tenant at least one
hundred twenty (120) days prior to the effective date of termination. If this Lease is so
terminated, then Landlord may recover from Tenant: (i) the worth at the time of award of any
unpaid rent that had been earned at the time of such termination; plus (ii) the worth at the
time of award of the amount by which the unpaid rent which would have been earned from the
time of such termination until the time of award exceeds the amount of such rental loss Tenant
proves could have been reasonably avoided; plus (iii) the worth at the time of award of the
amount by which the unpaid rent for the balance of the Term after the time of award exceeds
the amount of such rental loss that Tenant proves could be reasonably avoided; plus (iv) any
other amount necessary to compensate Landlord for all the actual and consequential damages
which in the ordinary course of things would be likely to result therefrom; and (v)
election, such other amounts in addition to or in lieu of the foregoing as may be permitted from
time to time by applicable California law. As used in Subsections (A)(i) and (ii) above, the
Subsection
amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of award
plus one percent (1%). All amounts owing under this Subsection which are not paid when due
shall bear interest at the Remedy Rate from the date owing until paid and such interest shall be
compounded monthly.
B. Reenter Premises. Landlord shall also have the right, with or
elsewhere at the cost of and for the account of Tenant.
April 14, 2026 Item #5 Page 26 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 22 -
C. Maintain Lease; Relet Premises. Landlord shall have the remedy
described in California Civil Code Section 1951.4 (lessor may continue lease in effect after
to sublet or assign, subject only to reasonable limitations). Unless Landlord elects to terminate
this Lease as provided in Section 16.2(A) above, Landlord may from time to time, without
terminating this Lease, either recover all rent as it becomes due or relet the Premises or any
part thereof for such term or terms and at such rental or rentals and upon such other terms
and conditions as Landlord in its sole discretion may deem advisable, with the right to clean and
If Landlord elects to relet as provided herein, then rent received by Landlord
indebtedness other than rent due hereunder from Tenant to Landlord; second, to the payment
customary to make the Premises ready to lease [including the removal of any specialized
improvements installed by Tenant], court costs and brokerage commissions); third, to the
payment of the cost of any cleaning, alterations and repairs to the Premises; fourth, to the
payment of rent due and unpaid hereunder; and the balance, if any, shall be applied in
payment of future rent as the same may become due and payable hereunder. If the portion of
such rentals received from such reletting during any month which is applied to the payment of
rent under the reletting lease is less than the rent payable during that month by Tenant
hereunder, then Tenant shall pay any such deficiency to Landlord immediately upon demand by
Landlord. Such deficiency shall be calculated monthly and Tenant shall pay such deficiency
improvements customary to make the Premises ready to lease (including the removal of any
specialized improvements installed by Tenant) and brokerage commissions and in making any
alterations and repairs to the Premises.
No reentry, acts of maintenance or preservation, efforts to relet, or taking
possession of the Premises by Landlord or the appointment of a receiver upon initiative of
this Lease shall be construed as an election to
terminate this Lease unless an express written notice of such intention is delivered to Tenant or
unless the termination thereof is decreed by a court of competent jurisdiction.
Notwithstanding any reletting of the Premises without termination of this Lease by Landlord,
Landlord may at any time after such reletting elect to terminate this Lease, in which case,
Landlord shall have all the rights and remedies provided by law or equity or this Lease upon
termination.
D. Performance by Landlord. If Tenant breaches or fails to perform
days (or such shorter time period as may be specified otherwise in this Lease) after Landlord
gives Tenant written notice of the breach or failure, Landlord, 6.2, but shall not be obligated to,
April 14, 2026 Item #5 Page 27 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 23 -
perform any such obligation for the account and at the expense of Tenant. Landlord may also
so perform any such obligation without notice in case of an emergency.
E. Receiver on Behalf of Landlord. If, at the instance of Landlord in
any action arising under this Lease, a receiver shall be appointed to take possession of the
Premises or to collect the rents derived therefrom, then the receiver may, if it shall be
necessary or convenient in order to collect such rents, conduct the business of Tenant then
business, without compensation to Tenant for such use. Neither application for, nor the
appointment of a receiver shall be construed as an election by Landlord to terminate this Lease,
unless express written notice of such election is given to Tenant. The fees and expenses of such
receiver shall be charged to Tenant as Additional Rent.
16.3 Late Charges. Landlord and Tenant agree that the fixing of actual
the late payment by Tenant to Landlord of rent and other amounts due hereunder, would cause
Landlord to incur costs not contemplated by this Lease, the exact amount of which would be
extremely difficult or impracticable to ascertain. Such costs include but are not limited to
accounting, processing, administrative, legal and clerical charges and late charges which may be
imposed upon Landlord by the terms of any Deed of Trust covering the Premises. Accordingly,
if any installment of rent or any other sum due from Tenant hereunder has not been received
pay to Landlord a late charge equal to five percent (5%) of any such delinquent installment of
rent or any other delinquent sum due from Tenant. Tenant hereby agrees that said late charge
represents a fair and reasonable estimate of the cost Landlord will incur by reason of late
payment by Tenant. Acceptance of such late charge by Landlord shall not constitute a waiver of
any other rights and remedies provided for in this Lease, at law or in equity. If a late charge is
payable by Tenant whether or not collected, for three (3) installments of rent during any twelve
(12) month period, then the Base Rent shall automatically become due and payable to Landlord
quarterly in advance, notwithstanding any other provision of this Lease to the contrary.
16.4 Interest on Past Due Obligations. Any and all amounts not paid to
Landlord when due, shall bear interest, compounded monthly from the date due until paid at
the rate of five percent (5%). Payment of such interest shall not excuse or cure any default by
Tenant under this Lease and shall not affect any rights and remedies provided to Landlord in
this Lease or at law or in equity, all of which shall be cumulative. Notwithstanding the
foregoing, the City Manager of the City of Carlsbad shall have the right, in its sole discretion, to
waive for good cause any interest payment upon written application of Tenant for any such
delinquency period.
16.5 Waiver of Redemption. Tenant hereby expressly waives any and all
rights of redemption granted by or under any present or future laws in the event of Tenant
April 14, 2026 Item #5 Page 28 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 24 -
being evicted or dispossessed for any cause, or in the event of Landlord obtaining possession of
the Premises by reason of the violation by Tenant of any of the covenants and conditions of this
Lease or otherwise. The rights given to Landlord herein are in addition to any rights that may
be given to Landlord by any statute or otherwise.
16.6 Guaranty. NA
16.7 . Landlord shall in no event be charged with default in
the performance of any of its obligations hereunder unless and until Landlord shall have failed
to perform such obligations and such failure continues for more than thirty (30) days (or such
written notice of such failure from Tenant.
16.8 Termination Provisions.
A. Landlord Termination. Notwithstanding any other provisions
contained in this Agreement, Landlord may terminate this Agreement for any reason by
giving Tenant at least three hundred and sixty-five (365) days prior written notice of such
termination after the initial five (5) year term. Upon termination, the Landlord may
immediately enter and take possession of the Premises.
B. Tenant Termination. Notwithstanding any other provisions
contained in this Agreement, Tenant may terminate this Agreement for any reason by giving
Landlord three hundred and sixty-five (365) days prior written notice of such termination.
Upon termination, the Landlord may immediately enter and take possession of the Premises.
C. Upper Parking Lot Area. Notwithstanding any other provisions
contained in this Agreement, Landlord may terminate Tenants use of approximately 72 parking
spaces located on the Upper-Parking Lot Area adjacent to the Premises, more particularly
shown in Exhibit A and A-1 (APN 213-061-28-00 and 213-061-27-00) for any reason by giving
Tenant at least thirty (30) days prior written notice of such termination. In such event, Landlord
shall have the continuing right, which Tenant hereby acknowledges and agrees shall run with
the Lease, to access and use the Upper Parking Lot Area and to travel across the Premises as
reasonably necessary to access such area. Such access shall be nonexclusive and shall not
ARTICLE 17
SUBORDINATION AND ATTORNMENT
17.1 Subordination
subordinate to any ground lease, mortgage, deed of trust and/or any other hypothecation or
security document and advances and obligations thereunder now or hereafter placed upon the
Premises, and any renewals, modifications, consolidations, replacements, and extensions
April 14, 2026 Item #5 Page 29 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 25 -
Deed of Trust
Landlord to Tenant without any further act of Tenant. Upon the request of Landlord, Tenant
shall, from time to time, execute and deliver any documents or instruments that may be
Lender
long as Tenant is not in default, or with notice or passage of time or both would not be in
default, under the terms, covenants, conditions and provisions of this Lease. If Tenant fails to
execute and deliver any such documents or instruments, Tenant irrevocably constitutes and
-in-fact, coupled with an interest, to execute and
to the lien of its Deed of Trust, and gives written notice to Tenant of such election, this Lease
shall be deemed prior to such Deed of Trust regardless of the respective dates of execution,
delivery and recordation of this Lease and any such Deed of Trust.
17.2 Attornment
instrument that Landlord may require to evidence such attornment. Tenant hereby irrevocably
-in-fact, coupled with an interest, to execute,
acknowledge and deliver the instrument of attornment on behalf of Tenant.
17.3 Estoppel Certificate. Upon the request of Landlord, Tenant at any time
and from time to time shall execute, acknowledge, and deliver to Landlord, no later than ten
Estoppel Certificate
interest in the Premises. Failure to deliver the Estoppel Certificate within ten (10) days of such
request shall be conclusive upon Tenant that: (i) this Lease is in full force and effect; (ii) there
Base Rent has been paid in advance; and (iv) the Security Deposit is in an amount equal to that
specified in Article 1 hereof. Tenant hereby irrevocably appoints Landlord as its attorney-in-
fact, which agency is coupled with an interest, to execute any such Estoppel Certificate upon
17.4
increase the rent, reduce the size of the Premises or otherwise adversely affect in any material
April 14, 2026 Item #5 Page 30 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 26 -
the case may be, written notice simultaneously with any notice given to Landlord to correct any
Purchaser shall have the right after receipt of said written notice to correct or remedy such
failure within a reasonable period of time. Any written notice of default given Landlord shall be
17.5 Limitation of Liability. The covenants and agreements of Landlord under
interest, as landlord, in the Premises. In the event of such a transfer, the covenants and
ARTICLE 18
FORCE MAJEURE
If either party hereto shall be delayed in or prevented from the performance of
any act required hereunder by reason of acts of God, labor troubles, inability to procure
materials, restrictive governmental laws or regulations or other causes without fault and
Force
Majeure
for the performance of any such act shall be extended for a period equivalent to the period of
such delay; provided, however, nothing in this Section shall delay the Rent Commencement
Date or excuse Tenant from the prompt payment of any rent or other charge required of
Tenant hereunder, except as may be expressly provided elsewhere in this Lease.
ARTICLE 19
ASSIGNMENT AND SUBLETTING
19.1 Tenant shall not voluntarily, involuntarily or by
operation of law assign, mortgage, sublet, hypothecate or otherwise transfer or encumber all or
operation of the whole or any part of the Premises, or permit the occupancy of any part of the
Premises by any other person or business entity, or permit transfer of this Lease by merger,
written consent. No consent to any Transfer shall constitute a waiver of the provisions of this
Section. If Tenant is a partnership or limited liability company, a withdrawal or change,
voluntary, involuntary, or by operation of law, of any partner or member, or the dissolution of
consent. If Tenant consists of more than one person or entity, a purported assignment,
voluntary, involuntary, or by operation of law, from one person to the other shall be deemed a
consolidation, or other reorganization of Tenant, or the sale or other transfer of twenty-five
April 14, 2026 Item #5 Page 31 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 27 -
percent (25%) or more of the capital stock of Tenant or the value of the assets of Tenant, shall
example and without limitation) that it shall be reasonable for Landlord to withhold its consent
(as defined below) use of the Premises conflicts with or is different from the Permitted Use;
(ii) the proposed Transferee or its business is subject to compliance with additional
requirements of law beyond those requirements which are applicable to Tenant; (iii) in
reputation or experience to operate a successful business of the type and quality permitted
under this Lease; (iv) Tenant is in default under this Lease; or (v) the present net worth of the
of no force or effect and shall not confer any estate or benefit on anyone. A consent to one
Transfer by Landlord shall not be deemed to be a consent to any subsequent Transfer to any
other party.
19.2 Request for Transfer
prior written notice of any requested Transfer and of the proposed terms of such Transfer
Transfer Notice
Transferee a current
financial statement of the proposed Transferee prepared in accordance with generally accepted
accounting principles consistently applied; (iii) the portion of the Premises Tenant proposes to
Transfer (including square footage and location); and (iv) the nature of the proposed
sufficient detail to enable Landlord to evaluate the proposed Transfer and the prospective
Transferee. Within thirty (30) days after receipt of the Transfer Notice, Landlord shall either
approve or disapprove of such Transfer; provided, however, that Landlord shall be deemed to
have disapproved the Transfer Notice if Landlord has not sent Tenant written notice of
Landlord of any modification to the proposed terms of such Transfer. Tenant shall also provide
to Landlord copies of the fully executed documents pertaining to the Transfer after the Transfer
has become effective. Whether or not Landlord consents to any proposed Transfer, Tenant
reasonable legal fees incurred by Landlord, within thirty (30) days after written request by
Landlord.
19.3 . Upon receipt of a Transfer Notice pursuant to Section
19.2 above, Landlord shall have the right to: (i) withhold its consent to such Transfer, as
permitted pursuant to Section 20.1 above; (ii) terminate this Lease as it relates to the portion of
the Premises described in the Transfer Notice and recapture such portion of the Premises,
effective automatically as of the date of dispatch of a notice of termination from Landlord to
April 14, 2026 Item #5 Page 32 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 28 -
refusal to consent to the Transfer; (iii) sublet or receive an assignment of all or a portion of the
(iv) that all rents paid by
the Transferee to Tenant in excess of the Base Rent be paid to Landlord; or (b) that any
Guarantor of this Lease reaffirms its guaranty; or (c) that either Tenant or the proposed
Transferee cure, on or before the proposed effective date of such Transfer, any and all uncured
and remedies under this Lease or under law or in equity in regard thereto. If Landlord has
elected to impose such a cure as a condition to its consent and such condition is not satisfied by
Landlord. The assumption agreement shall require the Transferee to expressly assume all
obligations of Tenant under this Lease and shall require Tenant and Transferee to be and
remain jointly and severally liable for the performance of all conditions, covenants, and
obligations to be performed by Tenant hereunder. The acceptance of rent by Landlord from
any other person shall not be deemed to be a waiver by Landlord of any provision hereof.
be exercised by Landlord in its sole discretion without limiting Landlord in the exercise of any
other right or remedy at law or in equity which Landlord may have by reason of such Transfer.
In the event of default by any Transferee, Landlord may proceed directly against Tenant
without the necessity of exhausting remedies against said Transferee. Tenant expressly agrees
that the provisions of this Article are not unreasonable standards or conditions for purposes of
Section 1951.4(b)(2) of the California Civil Code, as amended or recodified from time to time.
ARTICLE 20
NOTICES
All notices given under this Lease shall be in writing and shall be given or served
either personally or by depositing the same by United States registered or certified mail
postage prepaid, return receipt requested, or by a nationally-recognized overnight delivery
courier, addressed to the applicable Address for Notices specified in Article 1. Notice shall be
deemed to have been given (a) on the delivery date indicated by the United States Postal
Service on the return receipt or by the courier or on the date such delivery is refused or
deemed "undeliverable," or (b) on the date of personal delivery. Either party may change its
address for notices by providing written notice as specified herein; provided, however, that all
addresses provided must be an actual street address located in the United States of America.
April 14, 2026 Item #5 Page 33 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 29 -
ARTICLE 21
AUTHORITY
If Tenant is a corporation, trust, general or limited partnership or limited liability
company, each individual executing this Lease on behalf of such entity represents and warrants
that he or she is duly authorized to execute and deliver this Lease on behalf of said entity. If
Tenant is a corporation, trust, partnership, or limited liability company, Tenant shall,
simultaneously with execution of this Lease, deliver to Landlord written evidence of such
authority satisfactory to Landlord.
ARTICLE 22
QUIET ENJOYMENT
Tenant, upon keeping, observing and performing all of the covenants and
agreements of this Lease on its part to be kept, observed, and performed, shall lawfully and
quietly hold, occupy and enjoy the Premises during the Term of this Lease.
ARTICLE 23
Should either party commence an action or arbitration against the other to
enforce any obligation hereunder, the prevailing party shall be entitled to recover the costs
fees and charges of legal assistants or other non-attorney personnel performing services under
the supervision of an attorney), whether or not such litigation is prosecuted to judgment.
ARTICLE 24
WAIVER
Any waiver by Landlord of any breach by Tenant of any one or more of the
covenants, conditions, or agreements of this Lease shall not be nor be construed to be a waiver
of any subsequent or other breach of the same or any other covenant, condition or agreement
of this Lease, nor shall any failure on the part of Landlord to require or exact full and complete
compliance by Tenant with any of the covenants, conditions, or agreements of this Lease be
construed as in any manner changing the terms hereof or to prevent Landlord from enforcing
required to be paid by Tenant shall be deemed to have been received only on account of the
obligation for which it is paid and shall not be deemed an accord and satisfaction,
notwithstanding any provisions to the contrary asserted by Tenant, written on any check or
contained in any transmittal letter. The subsequent acceptance of rent hereunder by Landlord
shall not be deemed to be a waiver of any preceding breach by Tenant of any term or covenant
hereof, other than the failure of Tenant to pay the particular rent so accepted, regardless of
express waiver must be in writing and signed by a person with the power to contractually bind
April 14, 2026 Item #5 Page 34 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 30 -
Tenant or Landlord. An express waiver shall affect only the default specified in the waiver, and
only for the time and to the extent expressly stated.
ARTICLE 25
LIMITATION ON CLAIMS
Any claim, demand, right or defense of any kind by Tenant, which is based upon,
arising in connection with or in any way related to this Lease or the negotiations prior to its
execution, shall be barred unless Tenant commences an action thereon, or interposes in a legal
proceeding a defense by reason thereof, within twelve (12) months after the date of the
inaction or omission or the date of the occurrence of the event or of the action to which the
claim, demand, right or defense relates, whichever applies.
ARTICLE 26
INTERPRETATION AND APPLICATION
26.1 Submission of Lease. Submission of this instrument for examination or
signature by Tenant does not constitute an offer, a reservation of, option for or option to lease,
and it is not effective as a lease or otherwise until execution and delivery by both Landlord and
Tenant.
26.2 Governing Law. This Lease shall be construed in accordance with and
governed by the statutes, decisions, and other laws of the State of California. Tenant expressly
agrees that any and all disputes arising out of or in connection with this Lease shall be litigated
only in the Superior Court of the State of California for San Diego County, and Tenant hereby
consents to the jurisdiction of said court.
26.3 Complete Agreement. This Lease contains all terms, covenants,
conditions, warranties and agreements of the parties relating in any manner to the rental, use
and occupancy of the Premises. No prior agreements or understanding pertaining to the same
shall be valid or of any force or effect.
26.4 Amendment. This Lease may not be amended, altered or modified in any
way except in writing signed by the parties hereto.
26.5 No Partnership. It is agreed that nothing contained in this Lease shall be
deemed or construed as creating a partnership or joint venture between Landlord and Tenant
or between Landlord and any other party, or cause Landlord to be responsible in any way for
the debts or obligations of Tenant or any other party.
April 14, 2026 Item #5 Page 35 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 31 -
26.6 No Merger. The voluntary or other surrender of this Lease by Tenant, or
a mutual cancellation thereof, shall not work as a merger, but shall, at the option of Landlord,
either terminate all or any existing subleases or subtenancies, or operate as an assignment to
Landlord of any or all such subleases or subtenancies.
26.7 Severability. If any provision of this Lease or application thereof to any
person or circumstances shall to any extent be invalid, the remainder of this Lease (including
the application of such provision to persons or circumstances other than those to which it is
held invalid) shall not be affected thereby, and each provision of this Lease shall be valid and
enforced to the fullest extent permitted by law.
26.8 Captions. The captions of the Articles and Sections hereof are for
convenience only and are not a part of this Lease and do not in any way limit or amplify the
terms and provisions of this Lease.
26.9 Words
the plural as well as the singular. Words used in the neuter gender include the masculine and
feminine.
26.10 Joint and Several Liability. If either party is comprised of more than one
individual or entity, the obligations imposed upon such party hereunder shall be joint and
several to all parties signing this Lease as such party.
26.11 Exhibits. All exhibits attached to this Lease are incorporated herein by
this reference and made a part hereof, and any reference in the body of this Lease or in the
April 14, 2026 Item #5 Page 36 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 32 -
ARTICLE 27
MISCELLANEOUS
27.1 Time is of the Essence. Time is of the essence of each and all of the
terms and provisions of this Lease.
27.2 Successors. Subject to the restrictions on Transfers contained in this
Lease, all the terms, covenants and conditions hereof shall be binding upon and inure to the
benefit of the heirs, executors, administrators, successors and assigns of the parties hereto.
27.3 Recordation; Quitclaim. Tenant shall not record this Lease or any
memorandum hereof. Landlord has the right in its absolute discretion to record this Lease or a
acknowledged the same for recordation. Upon termination of this Lease for any reason, Tenant
shall execute, acknowledge and deliver to Landlord within thirty (30) days after receipt of
written demand therefor a good and sufficient deed whereby all right, title and interest of
Tenant in the Premises is quitclaimed to Landlord. If Tenant fails to deliver the required deed to
Landlord, Landlord may prepare and record a notice reciting the failure of Tenant to execute,
acknowledge and deliver such deed and said notice shall be conclusive evidence of the
termination of this Lease and of all right of Tenant or those claiming under Tenant in and to the
Premises.
April 14, 2026 Item #5 Page 37 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 33 -
27.4 Limitation of Liability. It is expressly understood and agreed that
notwithstanding anything in this Lease to the contrary, and notwithstanding any applicable law
to the contrary, the liability of Landlord hereunder (including any successor landlord) and any
interest in the Premises, including the income and profits from the Premises, and neither
Landlord, nor any of its officers, employees, affiliates, managers or agents shall have any
personal liability therefor, and Tenant hereby expressly waives and releases such personal
liability on behalf of itself and all persons claiming by, through or under Tenant. The limitations
of liability provided in this Section are in addition to, and not in limitation of, any limitation on
liability applicable to Landlord provided by law or in any other contract, agreement or
instrument. Under no circumstances shall Landlord be liable for punitive or special damages,
indirect damages or other consequential damages, including without limitation, injury to
Landlord's interest in this Lease, the Landlord herein named (and in case of any subsequent
transfer, the then transferor) shall be automatically freed and relieved from and after the date
of such transfer of all liability for the performance of any covenants or obligations on the part
of Landlord contained in this Lease thereafter to be performed; provided, however, that any
funds in the hands of Landlord or the then transferor at the time of such transfer, in which
Tenant has an interest shall be turned over to the transferee and any amount then due and
payable to Tenant by Landlord or the then transferor under any provision of this Lease shall be
paid to Tenant; and provided, further, that upon any such transfer, the transferee shall
expressly assume, subject to the limitations of this Section, all of the agreements, covenants
and conditions in this Lease to be performed on the part of Landlord, it being intended hereby
that the covenants and obligations contained in this Lease on the part of Landlord shall be
binding on each Landlord, its successors and assigns, only during its period of ownership.
27.5 Broker
to whom Landlord shall pay a commission pursuant to a separate written agreement between
other that it has not retained the services of or had any dealings with any other broker, finder
commission or payment of any kind whatsoever. Landlord and Tenant each shall indemnify,
protect, defend and hold harmless the other from and against all liability for compensation or
charges which may be claimed by any such other broker, finder or other similar party by reason
of any dealings or actions of the indemnifying party, including (without limitation) any costs,
expenses or attorney's fees reasonably incurred with respect thereto.
April 14, 2026 Item #5 Page 38 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 34 -
ARTICLE 28
Signatures
28.1 Counterparts. This Lease may be executed in any number of
counterparts each of which shall be deemed an original and all of which shall constitute one
and the same Lease with the same effect as if all parties had signed the same signature page.
The individuals executing this Lease represent and warrant that they have the right,
power, legal capacity and authority to enter into and to execute this Lease on behalf of the
respective legal entities of Tenant and Landlord.
[remainder of page intentionally left blank]
April 14, 2026 Item #5 Page 39 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
-35 -
IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the date first
above written.
LANDLORD:
CITY OF CARLSBAD,
a California municipal corporation
By:
Name:
Title: Geoff Patnoe, City Manager
TENANT:
MiraCosta Community College District
By:
Name:
Title:
APPROVED AS TO FORM
By:
Cindie McMahon, City Attorney
Date: ________________, 2026
April 14, 2026 Item #5 Page 40 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
April 15,
Geoff Patnoe
- 1 -
EXHIBIT A
LEGAL DESCRIPTION OF PREMISES
Accessory Parcel No. 213-061-19-00:
Lot 5 of Carlsbad Tract No. 80-33, in the City of Carlsbad, County of San Diego, State of
California, according to Map thereof No. 10061, filed in the Office of the County Recorder of
San Diego County on April 15, 1981 as File No. 81-115129.
Accessory Parcel No. 213-061-27-00 (Portion of Upper Parking Area)
Lot 4 of Carlsbad Tract No. 80-33, in the City of Carlsbad, County of San Diego, State of
California, according to Map thereof No. 10061, filed in the Office of the County Recorder of
San Diego County on April 15, 1981 as File No. 81-115129.
Accessor Parcel No. 213-061-28-00 (Portion of Upper Parking Area)
Approximately 9,500 square feet of the southern portion of Lot 4 of Carlsbad Tract No. 80-33, in
the City of Carlsbad, County of San Diego, State of California, according to Map thereof No.
10061, filed in the Office of the County Recorder of San Diego County on April 15, 1981 as File
No. 81-115129.
April 14, 2026 Item #5 Page 41 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 1 -
Exhibit A-1
Premises
APN 213-061-19-00
APN 213-061-28-00
APN 213-061-17-00
April 14, 2026 Item #5 Page 42 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 2 -
EXHIBIT B
MEMORANDUM OF TERM COMMENCEMENT
This Memorandum of Term Commencement is made as of ____________, 2026 by the
Landlord MIRACOSTA
COMMUNITY COLLEGE DISTRICT Tenant
the following matters:
1. Landlord and Tenant have entered into that certain Lease Agreement dated
as of ___________________, 2026 2075 Las
Palmas Drive, Carlsbad, California, 92011, as more particularly described in the Lease. All terms
defined in the Lease shall have the same meaning when used in this Memorandum of Term
Commencement.
2. The Term Commencement Date occurred on ___________________, 2026,
the Rent Commencement Date occurred on _____________________, 2026, and the Expiration
Date of the Lease is ________________________, 2031 s to extend
under Section 3.2 of the Lease.
3. Base Rent shall be paid by Tenant to Landlord in accordance with the
following schedule:
Lease Year Base Rent Per Month
___/___/2026 - ___/___/2027 $7,784.60
___/___/2027 - ___/___/2028 $8,212.76
___/___/2028 - ___/___/2029 $8,664.46
___/___/2029 - ___/___/2030 $9,141.00
___/___/2030 - ___/___/2031 $9,643.76
IN WITNESS WHEREOF, Landlord and Tenant have executed this Memorandum of Term
Commencement as of the date first written above.
April 14, 2026 Item #5 Page 43 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
-3 -
LANDLORD:
CITY OF CARLSBAD,
a California municipal corporation
By:
Name: Geoff Patnoe
Title: City Manager
TENANT:
MiraCosta Community College District
By:
Name:
Title:
April 14, 2026 Item #5 Page 44 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 4 -
EXHIBIT C
MiraCosta Community College District
Operational Guidelines
The below enumerated Operational Guidelines shall commence on the Term Commencement
Date. Landlord acknowledges that some enumerated performance measures are subject to
grant funding and/or fundraising. Tenant acknowledges that they shall use good faith efforts to
secure grant funding and/or fundraising for performance measures requiring such funding.
Tenant shall create a center that will serve as a Technology Career Institute (TCI) where
attendees can become skilled professionals in advanced manufacturing and be trained on
machinery and/or new technology that will create jobs and benefit Carlsbad businesses and the
region.
Tenant shall be allowed to hold events and functions that will promote the center's purpose
and function such as Job Fairs, Industry Open Houses STEM summer outreach programs from
High School and Middle School students, and program fund raisers.
Furthermore, the Center aims to increase the sphere of available advanced education to
include other trades or skills to help in an evolving workforce including additional Work Skills
Certificate Programs at TCI in Welding and Craft Brewing Technician courses.
(Breakdown of Programs and Enrollment on Next Page)
CURRENT WORK SKILLS PROGRAMS & COURSES AT TCI
April 14, 2026 Item #5 Page 45 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
- 5 -
Certificate Programs Offered at TCI Cohorts Per
year
Typical
Enrollments
Engineer Technician - 600 hrs 3 16
Machinist Technology - 487 hrs 2 15
Unmanned Systems - 335 hrs 2 16
Biomedical Equipment Technician- 440 hrs 2 16
Electronic Assembly with IPC Cert. - 80 hrs 3 10
Phlebotomy Technician - 160 hrs 2 15
Veterinary Assistant 160 hrs 2 20
108
Courses/Classes Offered at TCI Cohorts Per
year
Typical
Enrollments
Child Visitation Monitor 2 12
CNC Operation 3 10
CNC Programming 3 12
Human Resources Academy 2 18
Leadership Academy (Contract Training) 2 18
Basic Electronics 1 12
Blueprint Reading with GD&T 2 14
LEAN Six Sigma 3 12
OSHA 10 & 30 2 15
Internet of Things 1 10
3D CAD for Manufacturing 3 11
144
New Classes Offered at TCI Cohorts Per year Typical
Enrollments
Welding 6 10
Craft Brewing Technician 2 16
April 14, 2026 Item #5 Page 46 of 46
Docusign Envelope ID: 241C08DD-CED7-4033-8A60-5E83C8C4745A
From:Kristen Gonzales (Huyck)
To:City Clerk
Cc:Elizabeth Lurenana
Subject:Re: 5. LEASE AGREEMENT WITH MIRACOSTA COMMUNITY COLLEGE DISTRICT FOR THE LAS PALMASPROPERTY, 2075 LAS PALMAS DRIVE
Date:Tuesday, April 14, 2026 1:47:00 PM
Attachments:image002.png26.4.14 Carlsbad City Council Mtg Ltr from MiraCosta College.pdf
Good afternoon,
Please find attached a letter of support from Dr. Sunny Cooke, Superintendent/President of
MiraCosta College, regarding Consent Item 5: Lease Agreement with the MiraCosta CommunityCollege District for the Las Palmas Property, 2075 Las Palmas Drive.
Thank you for your continued partnership.
In service,
Kristen J. Gonzales (Huyck), Ed.D.Executive Director, Public & Governmental Relations,
Marketing & Communications
Part-time faculty, Political Science
kgonzales@miracosta.eduC 858.342.9168
Oceanside Campus
1 Barnard Drive | Oceanside, CA 92056
P 760.795.6857 | miracosta.edu
CAUTION: Do not open attachments or click on links unless you recognize the sender and
know the content is safe.
All Receive - Agenda Item #_____
For the Information of the:
CITY COUCNIL
Date: ___________ CA ____ CC____ CM ____ ACM ____ DCM (3) ____
5
4/14/2026 x x x x x
Carlsbad City Council Meeting
Council Chamber 1200 Carlsbad Village Drive Carlsbad, CA 92008
Tuesday, April 14 at 5 PM
City Meeting Agenda
Letter of Support
Re: 5. LEASE AGREEMENT WITH MIRACOSTA COMMUNITY COLLEGE DISTRICT FOR
THE LAS PALMAS PROPERTY, 2075 LAS PALMAS DRIVE
Dear Mayor Blackburn, Councilmembers, staff, and members of the Carlsbad community,
Thank you for including the five-year lease for MiraCosta College’s Technology Career Institute
site in Carlsbad. This agreement enables us to continue delivering high-quality workforce
training programs that directly serve our community and local employers.
MiraCosta College is a vital regional resource, serving students, working adults, veterans, and
military families by providing high-quality, affordable education. As the cost of higher education
continues to rise, more students are choosing MiraCosta College as a smart pathway, saving
money while staying on track for transfer, career advancement, and workforce success.
Our impact stays local. More than 90 percent of MiraCosta College graduates remain in San
Diego County, strengthening our workforce and contributing directly to the regional economy.
None of this work would be possible without strong community partnerships. Thank you again
for your partnership and for your support of MiraCosta College and the communities we
collectively serve.
Sincerely,
Dr. Sunny Cooke
Superintendent/President
MiraCosta Community College District