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HomeMy WebLinkAbout1980-08-26; City Council; Resolution 6286c, 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 RESOLUTION YO. 6286 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, APPROVING A LEASE AGREEMENT BETWEEN THE CITY OF AND AUTHORIZING THE TRANSFER OF FUNDS FOR THE LEASE, CARLSBAD AND PALOMAR 91 O-BERNARD W. GILMORE BE IT RESOLVED by the City Council of the City of Carlsbad as follows: 1. That that a certain agreement between the City of Carlsbad and Palomar 910-Bernard M. Gilmore, a copy of which is attached hereto marked Exhi bit "All and incorporated herein by reference, is hereby approved. 2. That the transfer of three thousand eight hundred fiftv-one dollars (163,851) from account 01-139-2450 to account 01-104-2350 be made for the lease of storage space is hereby authorized and approved. This will leave a balance of $856,581 in the Contingency Fund, 3. That Department of Finance Fund Transfer No, 6 on file in said Department and incorporated by reference herein is approved PASSED, APPROVED AND ADOPTED by the City Council of the City of Carlsbad adjourned at a/regular meeting held on the 26th dqy of Auqust 1980, by the following vote, to wit: AYES: Council Members Packard, Casler, Anear, Lewis and Kulchin NOES: None ABSENT: None ATTEST : RONALD C. PACKARD, Mayor ALETHA XL L. RAUTENKRANZ, 2Rfiy City Clerk (SEAL) Exhibit "A;' Lessor .... Lessee .... PALONA R ........ 910 THE CITY OF .............. - BERNARD W. - ......... CARLSBAD ............ GILMORE ........ ........... .-. . ~ . ....... .. .... .- .> e; .............. ............ # 0 0 A. - DFF~NED TERMS, EXWRITS, TABLE Ok’ CONTENTS, PREMISES, COSfbf OX AREAS. 3. Def;iicrl 7’CrIti.~. Other teiins ;ire as defined in the Lease. Each reference in this J,ease to any of the folloNYing titles shali incorporate the data stated for that title: Landlord: ... PALOMAR 910 - BERNARD W. ................................................................ GILMORE ... a ................................................................................. ................................................. THE CITY OF CARLSBAD Tenant: : ...... ... .......... .’. .: a ......................................................................... Building Location: Street Address: 6351 Yarrow Dr. , Suite D Carfsbad, Ca City: County: San Diego State: California Tenant’s Floor Space: Approximately 5, 760 s . f. Total Rentable Floor Space: Approximatell 4 2, 4 8 0 s . f . Tem: 1 . years. with option to renew for 1 yr. with COL Fixed Rent: $ 1, 555. 20 per month L--- 9 Tenant’s Share of Operating Expenses: 13 - 56%. L..--- - Tenant’s Share of Impositions: 13 - 5 6%. i Tenant’s Share of Insurance Expenses: 13.5 6 70. Scheduled Term Commencement Date: See Adi3endum - 6. Section (2-13 Liability Insurance Amounts: L . 3 Bodily Injury per person: 500,000 Bodily Injury per txcurrence: 1, 0 0 0, 0 0 0 Property Damage: 500,000 ............. ................. .............. ! Boiler Insurance: 500,000 1 Landlord's Construction Representatives: ' BERNARD W. G1LMOR.E Tenant's Construction Representatives: ROGER GREER 2. Landlord's Address: 6361 Yarrow, A -, Carlsbad, Ca. 92008 ......... Street ............. ......... ................ .* . Tenant's Address: 1200 Elm St., Carlsbad, Ca. 92008 Street .. ............. '. Permitted Uses: Any lawful uses consistant with the Declaration of Covenants and Restrictions. Declaration of Covenants and Restrictions: Copy delivered to Tenant Recorded: October.1, 1974, Amended February 25, 1977 and May 23, 1977 Table of Confents. A. Defined Terms, Exhibits, Tnble of Contents, Premises, Common Areas ............ B. Landlord's Improvements ....................................... - ............ C. Term ... ................................................................. D. Rent ......................................................................... E. Impositions ............. ........................................ F. Insurance ................ ............................ i.... .............. C. Repairs, hfainten;uice. Alterations, Operating Expenses ........................... - €4. Tennnt's Fixtures and Personal Property ........... ............................ I. Utilities and Boundaries ..................... :. . ............................ 1. Use of Preniises ................................... :.. ...... K. 1hiii:tge or Destruction ........................................... I.. Enlinelit Domain .......... ............................................ hi . 1 )c*f;1111 I ................. .............................................. N. Assigliment and Su1)lettiiig ........................................ ..... 0. Offset Statement, Attornment arid Subordination .................... P. Notices ............... :. ........ ...........I....... ....................... ;_ 0. hiiscellaneous ... .................................................. R. Siiccessors Bound ................................... ....... 3 - 2 - Page - 1 3 5 5 6 7 8 9 9 10 10 I1 12 14 16 ' 16 :; ....... ......... --- . ...... .... .. ....- \ # The following Exhibits are attached to this Lease after the signatures and are incorporzted herein by reference thereto. Description: Exhibit A - Tenant’s Floor Plan. L 3. Premises. LandIorcI hereby leases to Tenant, subject to and with the benefit of the provisions of this Lease, Tenant’s Floor Space (“Demised Premises”) in the Building extending from the top surface of subfloor to the bottom surface of ceilings above but excluding the common stairways, stairwells, hallways, accessways, and pipes, ducts, conduits, wires and appurtenant fixtures serving exclusively or in common other parts. of the Building, and if Tenant’s Floor Spitce includes less than the entire rentable area of any floor, excluding also the remainder of the Floor Common Area. r. 4. Common Areas. Tenant shall have, as appiirtenant to the Demised Premises, rights to use in common, subject to reason- The common stairways and accessways, loading docks and phefoms and any passageways thereto, and the common pipes, ducts, conduits, wires and appurtenant equipment serving the Demised Premises; (b) Floor Common Area. If the Demised Premises include less than the entire’reatable area of any floor, the common lobbies, hallways, toilets and other common facilities; and Common walkways, sidewalks, and driveways necessary for access to the Building and parking spaces or area from time to time maintained on the real property r2on which the Building is located (“Lot”) and to the extent from time to time arranged by Landlord, on adjacent real property. ’ able rules from time to time made by Landlord of which Tenant is given notice: (a) Building Common Areas. ( C) Land Common Area. 5. Lrmdlord‘s Reserved Rights in Common Areas. Landlord reserves the right from time to time, without unreasonable interference with Tenant’s use: (a) Building Changes. To install, use, maintain, repilir and replace pipes, ducts, conduits, wires and appurtenant meters and equipment for service to other parts of the Building above the ceiling sur- faces, below the floor surfaces, within the walls and in the central core areas, and to relocate any pipes, ducts. conduits, wires and appurtenant meters and equipment included in the Demised Premises which Are SQ located or located elsewhere outside the Demised Premises; (b) Boundur!/ Changes. To change the lines of the Lot; (c) Facility Change.s. To alter or relocate any other common facility; provided, however, that sub- stitutions are substantialIy equivalent or better in quality. I B. LANDLO~D’S IMPROVEMEXTS. 1. Pklszs. 8 3; Preliminary Plans. tioils (“Preliminary PIi~l1s”) identified in Exhibit B, for the construction of the Demised Premises.. Landlord and Tenant have approved the preliminary plans and outline specifica- 3 0 b. Final Plum. Landlord shall have prepiired final plans and specifications (“Final Plans”) substan- tially in conformity with the Preliminary Plans, which need not include working or shop drawiiigs. “Plans” shall hereiiiafter memi Preliminary Plans and then, when prepared, Filial Plans. Final Plans shall he delive~ed to Tenant as soon as reasonably possible from the date hereof, subject, however to any period of delay en- countered by Lancllord in such prepariitioii as a result of requests by Tenant for changes in Final Plans sub- sequent to the date hereof. Withiri ten (10) days after deliveiy of the Final Plans, Tenant shall set forth in writing with particularity and precision, any corrections or changes necessary to bring the Final Plans into sul)stantiiil coiiforrnity with the Preliminmy Plaiis, except that Tenant may not object to any logical develop- ment or refinement of the Prelinlinary Phis. Failure to deliver to Landlord written notice of any such correc- tions or changes within said ten (10) day period shall constitute approval of the Final Plans by Tenant. Following such approval of the Fin::l Plans, both parties shall endorse xpproval for filing purposes thereon, in duplicate, and thereafter changes may be made only in accordance with Section B-4. 2. Construction. I,andlord, at its sole expense, shall proceed diligently with constniction and completion of the Demised Premises substantially in accordance with the Plans. Laiidlord shall complete the Demised Premises and they shall be ready for occupancy, as defiiied in Section R-5, by Tenant not later than the Scheduled Term Com- mencement Date; provided, however. that the Scheduled Term Commencement Date shall be extended for a period of time eqtial to the period of any delay or delays encountered by Landlord affecting said work of constniction becaiisc of fire, earthquake, iiiclenient weather, or other acts of God, acts of the public enemy, riot, insurrection, governmental regulations of the sales of materials or supplies or the transportation thereof, strikes or boycotts, shortages of material or labor, Tenant’s earIy entry under the provisions of Section B-8, changes in the Plans pursuant to Section B-4, or any other cause beyond the control of Landlord. 3. Fuilm-e to Complete Construction. If the Demised Premises are not completed on or before the Scheduled Term Commehcement Date as extended pursuarlt to Section B-2, the sole remedy of either party shall be the option to terminate this Lease by the delivery to the other party of written notice within ten (10) days after the day six (6) months following the Scheduled Term Commencement Date, as extended. \~EE ADDENDUM) 4. Chnnga.r. in Platu. Tenant shall have the riglit to request changes in Plans, which request shall not be unreasonably denied, provided, however, that: (a) such right slrall iiot be exercised unreasonaldy, (1)) no siich request shall affect arty major structural change in the Demised Premises, (e) Tenant shall ply any additional cost required to implement such change incurred by Landlord, including, without limitation loss of rents, architecture fees, increase in construction cost and other charges payable hereunder, caused by delay and Tenant shall pay 1,andlord either for said costs upon demand or by entering into an amendment to this Lease which provides for a proportionate increase in Fixed Rent, the method of payment to be at the option of Landlord, and (d) such requests shall constitute an agreement on the part of Tenant to any delay in completion czused by reviewing,, processing and implementing the change. 5. ConipIetioti und Delivery. The I)elnisecl Premises shall lie ready for occupancy (“Heady for Occupancy”) when the work of ~011- structiorr has I~eeii substantially conipleted in accordance with the Pla~. Landlord shall prepare, certify by his signature, :ind deliver, in duplicate to Tenant a written statement certifying (a) that the Demised Premises h:ive been substantially completed in accordance with the Plans, aid any properly authorized cllallges or amendments thereof, and (1)) the date of such completion. Landlord shall diligently complete, as sooll as reasonably possible, my items of work and adjustment not completed when the Demised Premises are Heady for Occupa~~cy. 1 6. All work shall be done in a good and workmanlike manner and in compliance witx. all applicable laws and lawful ordinances, by-laws, regulations and orders of governmental authority and of the insurers of the Quality of C0nstm-t’ CI zon. * Building. 7. Construction Repesentatiw. In connection with the construction of the Demised Premises, each party shall be bound by its Con- struction Representative. A party may designate a substitute Construction Representative by giving written notice to the other party. 8. Early Entry. With the prior written consent of Landlord, Tenant may at any time prior to the commencement of the Term, at its sole risk, enter upon and install such trade fixtures and equipment in the Demised Premises as it may elect; provided, however, that (i) Tenant’s early entry shall not interfere with Landlord’s work of construction or cause labor difficulties; (ii) Tenant shall execute an indemnity agreement in favor of Land- lord in form and substance satisfactorgr to Landlord; (iii) Tenant shaIl pay and provide evidence cf insurance .satisfactory to Landlord; and (iv) Tenant shall pay utility charges reasonably allocated to Tenant by Land- lord. Tena’nt shall not use the Demised Premises for storage of inventory or otherwise commence the opera- tion of business without the express prior written consent of Landlord. I. Commncemnt of Term. The term of this Lease shall commence upon the earliest of the following dates: (a) Scheduled Term Commencement Date, as may be extended: (b) The date on which the Demised Premises are Ready for Occupancy, as set forth in Section B-5 (c) The date upon which Tenant actually commences to do business on the Demised Premises with above; or Landlord’s written consent. D. RENT. 1. FixedRent. Tenant shall pay the Fixed Rent to Landlord in advance upon the first day of each calendaq $&Dk the Term, at LandIord’s address or at such other place designated by Landlord in a notice to Tenant, without any prior demand therefor and without any dedu whatsoever. If the Term shall commence and end on a day other than the first day of a calen& n Tenant shall pay, upon the commencement data of the Term or Grst day of the Iast calendar la prorata portion of the Fixed Rent described in the foregoing paragraph, prorated on a per diem basis, with respect to the portions of the fractional calendar quarter included in the Term. IT 2. Additional Bent. All charges required to be paid by Tenant hereunder, including without limitation payments for Imposii ;:~~T:AL\ tions, insurance and repairs, shall he considered additional rent for the purposes of this Lease (“Additionag +. ____....... -- .I Rent”), and Tenant shall pay Additional Kent upon written demand by Landlord. “Rent” shall mean Fixed Rent and Additional Rent. 3. Interest. If any installment of Rent is not paid promptly when due, it shall bear interest at the lower rate of either ten percent (1001r,) or the maximum rate permitted by law, from the date on which it is due until the date on which it is paid regardless of whether or not a notice of default or notice of termination has been given by Landlord. This provision shall not relieve Tenant from payment of Rent at the time ilnd in the manner herein specified. E. IMPOSITIONS. 1. Teiurnt’s Ohligations. Tenant shall pay to Imidlord 8s Additional Rent, Tenant’s Share of Impositions multiplied by the sum of the following: all real estate taxes and all other taxes relating to the Demised Premises, all other taxes which may be levied in lien of real estate taxes, assessments, and other governmental charges, or levies, general and specia1,‘ordinary and extraordinary, unforeseen as well as foreseen, of any ?&d and nature for public improvements, services or benefits (hereinafter collectively referred to as “Impositions”), which are assessed, levied, confirmed, imposed or become a lien upon the Demised Premises, Building and/or Lot, or become payable during the Term; provided. however, that: 2. (i) Any Tmpositions shall be prorated between Landlord and Tenant so that Tenant shall pay only that proportion thereof which the part of such period within the Term bears to the entire period; and (ii) Any snch sum payable by Tenant, which would not otherwise be due until after the date of the termination of this 1,ease. shall he paid by Tenant tc, Landlord upon such termination. Installnrs nt Election, In the case of my Impositions which may be evidenced by improvement or other bonds or which may be paid in annual or-otlie; periodic installments, Landlord shall elect to cause such bonds to be issued or cause such assessment to he paid in installments over the maximrim period permitted by law. 3. Z,imifnfiot1. Nothing contained in this 1,rase shall require Tenant to pay any franchise, corporate, estate, inheritance, succession, transfer tax of I,andlord, or any income, profits or revenue tax or charge, upon the net income of: Landlord; provided, however, that if at any time during the Tern under the laws of the United States Gov- ernment or the state in which the llemised Premises are located, or any political subdivision thereof, a tax or excise on rent, or any other tax however described, is levied or assessed by any such political body against hndlord 011 account of rentals payable to Landlord, Tenant shall pay one hundred percent ( 1OO”L) of any said tax or excise on rent as Additional Rent. 4. Personal Property Taxe,s. .Tenant shall pay or c‘ai~se to be paid, prior to delinquency, any and all taxes and assessments levied upon all trade fixktres. inventories and other personal property placed in and upon the Demised Premises by Tenant. I;, INSITHANCF:. 1. Fin. cinrl Ehtc~nclrA COUCW~Y. I>iiring thv Tenn Imdlord shall procure arid piaintain in fid1 force and effect with respect to the Building, n policy or policies of fire insurance with extended coverage endorsement attached, including vandalism and innliciorrs niischief coverage. arid ally other endorsements rcqiiired by the holder of any fee or leasehold ~nortgage in ;In :uiiotint eqml to one hundred percent ( 100%) of the full insurance replacement value (repIace- m&it cost ww. i~idticling dehriq rmwvd, :id demolition) thereof. Tenant shall promptly pay to Landlord within five (5) days after demand therefor ;in amount equal to ‘Tenant’s Share of Insurance Expenses multiplied by the premium or premiums on insurance maintained by Landlord pursuant to this Section. with appropriate proration at the beginning and end of the Tenrr. 2. PtLhlic Lrahdity. Tenant shall, at its own cost and expense, keep and maintain in full force during the Term, a policy or policies of comprehensive public linbility insurance, written by an insurance company approved by Landlord in the fonn custoniq to the locality, insuring Tenant’s activities with respect to the Demised Premises against loss, damage or liability for personal injury or death of any person or loss or damage to property occuning in, upon or about the Demised Premises in amounts of not less than those set forth in Section A-l hereinabove for injury or death of any one person, for injury or death of all persons in any one occurrence, and for property damage and for damage from boiler, if applicable; provided, however, that if at any time during the Term, Tenant shall have in full force and effect a blanket policy of public liability insurance with the same coverage for the Demised Premises as described above, as well as coverage of other premises and properties of Tenant, or in which Tenant has some interest, such blanket insurance shall satisfy the requirement hereof. 3. Rental Abatement Iwrance. Landlord shall keep and maintain in full force and ef€ect during the Term, rental abatement insurance against abatement or loss of Rent in case of fire or other casualty, in an amount at least equa: to the amount of the Rent payable by Tenant during one year next ensuing as reasonably determined by LandIord. Tenant shall pay to Landlord within five (5) days after demand therefor accompanied by evidence of payment, an arnoutit equal to Tenant’s Share of Insurance Expenses multiplied by the premium or premiums on insurance maintained by Landlord pursuant to this section, with appropriate proration at the beginning and end of the Term. , 4. lnstdruace Certificates. Tenant shaiI furnish to Landlord, upon the date of commencement of this Lease and thereafter within thirty (30) days prior to the expiration of each such policy, a certificate of insurance issued by the insurance carrier of each policy of insurance carried by Tenant pursuant hereto. Said certificates shaIl expressly provide that such policies shall not be cancellable or subject to reduction of coverage or otherwise be subject to modifration except after thirty (30) day’s prior written notice to the parties named as insureds in this Sec- tion F-4. Landlord, its successors and assigns, and any nominee of Landlord holding any interest in the Demised Premises, including, without limitation, any ground lessor and the holder of any fee or leasehold mortgage, shall be named as insureds under each such policy of insurance maintained by Tenant pursuant to this Lease. 5. Tenant’s Failure. If Tenant fails to maintain any insurance required in this Lease, Tenant shall be liable for any loss or cost resulting from said failure. This section F-5 shall not be deemed to be a waiver of any of Landlord’s rights and remedies under any other section of this Lease. 1 6. Waiver of Suhrogutian. Any policy or policies of fire, extended coverage or similar casualty insurance, which either party obtains in connection with the Demised Premises shall include a clause or endorsement denying the insurer ally rights of st1brog:ition against the other party to tKe extent rights have been waived hy the insured prior to the occurrence of injury or loss. LandIord and Tenant waive any rights of recovery against the other for injury or loss due to hazxds covered hy insurance containing such a waiver of subrogntioii clause or endorse- me!it to the extent of the iiijury or loss covered thereby. 7. Temnt’s Fixtures. Tenant shall assume the risk of damage to any fixtures which remain the property of Tenant or as to which Tenant retains the right of removal from the Demised Premises. 8. lndetiinification of Landlord. (SEE ADDENDUX1 Tenant shall indemnify and hold Landlord and the Demised Premises harmIess from and against (i) any and all liability, penalties, losses, damages, costs and expenses, demands, causes of action, claims or judgments arising from or growing out of any injury to any person or persons or any damage to any property as a result of any accident or other occurrence during the term of this Lease occasioned by any act or omis- sion of the Tenant, its oficers, employees, agents, servants, subtenants, concessionnaires, licensees, contractors, invitees or permittees, or arising from or growing out of the use, maintenance, occupation or operation of the Demised Premises during the term of this Lease, and (ii) from and against ail legal costs and charges, including reason:ible attorneys’ fees, incurred in aiid about any of such matters and the defense of any action arising ont of the same or in discharging the Demised Premises or any part thereof from any and all liens, charges or judgments which may accrue or be placed thereon by reason of any act or omission of the Tenant; provided, however, that Tenant shall not be required to inJemnify LandIord for any damage or injury of any kind arising as the result of Landlords wilfuI acts or those of its agents oi emgIoyees. . G. REPALRS, MAINTENANCE, ALTE~TIONS, OPERATING EXPENSES. 1. Operating Expense. Tenant shall pay to Landlord as Additional Kent, Tellant’s Share of Operating Expenses multiplied by the amount which Landlord expends for Operating Expense. “Operating Expense” shall include reasonable and necessary expense$ nc!ually illcurred by Landlord for the operation, cleaning, maintenance, repair and management of the Birilding and Lot, including without limitation, the roof and walls except for structural repair of the same, all walks, driveways, parking and loading areas, lawns and landscaping. Tenant shall. at Tenant‘s sole cost apd expei)se, keep arid iaaintain the Demised Premises, subfloors and floor coverings in good repair :iiicl iii a clean and safe condition, casualties covered by insurance coverage excepted to the extent of proceeds received. Tenant shall, at Tenant’s own expense, immediately replace all g1;~ss in the Deinised Premises that may be broken during the Term with glass at least equal to the specifica- tion and quality of the glass so replaced. (SEE ADDENDUM) 3. JAndlord Repairs (Inn Muintcnunce. Landlord shall, at its expc*nse. after written notice from Teiiniit, repair in a prompt and diligent manner nny damage to stnictural portions of the roof aiid bearing w:dls of the Demised Premises; provided, however, that if such damage is cuused by an act or omission of Tenant, then such repairs shali be at Tenant’s expense, 8 payable to Laiicilorcl as Additional Rent hereunder. There shall be no abatement of Rent during the perfomi- iince of such work. Imidlord shall not 1~ liabk to Tenant for injury or damage that may result from any defect in the constructioii or coiiditions of the Demixd Premises. Tenant waives any right to make repairs at the expense of LmiclI(ird iitider any law. stiitiite or ordinance now or hereafter in effect. 4. Inspeciion of Leusecl Premise.9. Landlord, at reusonable times. may go upon and into the Demised Preniises for the purpose of inspecting the same, or for the purpose of inspecting the performance by Tenant of the terms and conditions hereof, and for the purpose of affixing reasonable signs and displays illid showing the Demised Premises to prospec- tive purchasers, tennnts and lenders. 5. Workmunlike Vualit!i. All reiairs, alteri~tions, additions, and restoration by Landlord or Tenant hereinafter required or per- mitted shall he done in a good arid workmanlike manner and in compliaiice with all applicable laws and law- ful ordinances, by-laws. regulations and orders of governmental authority and of the- insurers of the Building. 6. Liens. Tenant shall promptly pay and discharge 311 claims for work or labor done, supplies furnished or services rendered at the request of Tenant and shaI1 keep the Demised Premises free and clear of all mechanic’s and materialmen’s liens in connection therewith. Landlord shall have the right to post or keep posted on the Demised Premises, or in the immediate vicinity thereof, any notices of non-responsibility for any construction, nlteration or repair of the Demised Premises by Tenant. If aiiy such lien is filed, LzndIord may, but shall not be required to, take such action or pay such amount as may be necessary to remove such lien; and Tenant ‘shall pay to Landlord as Additional Rent any such amounts expended by Landlord together with interest thereon at the highest legal rate from the date of expenditure. H. TENANT’S FIXTURES AND PERSONAL PROPERTY. s Tenant. at its expense, may install any necessary trude fixtures, equipment and furniture in the Demised Premises, provided that such items are jiistalIed und are removable without damage to the structure of the Building. Landlord reserves the right to approve or disapprove of curtains, draperies, shades, paint, or other interior improvements visible from outside the Demised Premises on wholly aesthetic grounds. Such improve- ments miist he submitted for Landlord’s written approval prior to installation, or Landlord may remove or replxce such items at Tenant’s sole expense. Said trade fixtures, equipment and fumiture shall remain Tenant’s property and shall be removed by Tenant upon expiratioii of the Term, or earlier termination of this Lease. Upmi Lundlord’s prior written approval, Tenant may make structutiil alterations and may also install tempor- ary improvements in the interior of the Demised Premises, ixovided that such temporary improvements are installed and are reniovable without damage to the structure of the Building. Such temporary improvements shall remain the property of Tenant and shall be removed l)y Tenaiit upon expiration of the Term or earlier termination of this Lease. Tenant shall repair, at its sole expense, all damage caused by the installation or removal of trade fixtures, equipment, furniture or temporary improvements. If Tenant fails to remove the foregoing itcms on termination of this Lease, Landlord may keep and use them or remove any or all of them and ca~ise them to be stored or sold iii iiccordance with itpplicable law. I. LrnLlTtFS AND BOUNDARIES .. 1. Utilities. Tenant shall be solely responsiblc for and promptly pay all chnrges for heat, water, gas, electricity and any other iitilities used or consumed on the Demised Premises. Landlord shail not be liable to Tenant for intert 9 ruption in or curtailnient of any iitility service, nor shall any such incerruption or curtailment constitute a constructive eviction or grounds for rental abatement in whole or in part hereunder. If any such utilities :ire not separately metered, Teriant shall pay a prorata share, based on use, as determined by 1,andlorcl. 2. Easements. Landlord reserves the right to (i) alter the houtidxies of the Lot and (ii) grant easements on the Lot and dedicate for piiblic use portions thereof without Tenant's consent, subject to the provisions of Section 0-2 hereof, and provided that no such grant or dedication shall interfere with Tenant's use of the Demised Premises or otherwise cause Tenant to incur cost or expense. From time to time. and upon Landlord's demand, Tenant shall execute, acknowledge and deliver to Landlord or in accordance with Landlord's instructions any and all documents, instruments, maps, or plats necessary to effectuate Tenant's covenants hereunder. J. USE OF PREMISES. 1. . . General. The Demised Premises shall be used for the Pemiitted Uses, consistent with the Declaration of Covenants and Restrictions and any supplement thereto. Tenant shall, at Tenant's sole cost and expense, comply with all of the requirements of municipal, county, state, federal and other applicable governmental authorities, now in force, or which may hereafter be in force, pertaining to the Demised Premises, Building and Lot, and secure any necessary permits therefor and shall faithfully observe, in the use of the Demised Premises, Building and Lot, all municipal and county ordinances and state and federal statutes now in force, or which may hereafter be in force. Tenant shall obtain any required certificate of occupancy with respect to its use of the Demised Premises, Building and Lot, within thirty (30) days from the commencement of the Term hereof and shall deliver a copy thereof to Landlord within said thirty (30) day period. Tenant in its use and occupancy of the Demised Premises shall not commit waste, nor overload the floors or structure, nor subject the Demised Premises to any use which would tend to damage any portion thereof. . 2. Sigm. Any sign placed or erected by Tenant oii the Dernised Premises, Building or Lot, except in thr interior taf the Demised Premises, shall contain only Tenant's iiaiiie, or the name of any affiliate of Tenant ri~tualiy occupying the Demised Premises, and no ridvertising matter. No such sign shall be erected mtil Tenant has obtained Landlord's writteii approval of the location, material, size, design and content thereof and any. necessary permit therefor. Tenniit shall remove any such sign upon termination of this Lei~se arid shall retuni the Demised Premises to their condition prior to the placement or erection of said sign. ,. .. '_ .. 3, Parking Access. I. I11 ;iddition to thr geiivr:d o1)ligutioii of Teninit to coiiri>ly with laws and without liniitiitioii thereof, 1,aiicllord shall not be li:iI)le to Tenant nor shall this Lease be affected if alty parking privileges appurtenant to the Ileiiiised Premises, HtiiIdiilg mid I.ot ;ire impaired by reikon of any moratorium, initiative. refereiidunn, statute, rcgiilrition, or otlw governmental decree or actio11 which could iii ii~iy manner prevent or limit the parkiiig rights of Teiimt 1ic.reuiider. Aiiy goveriimtwt;il charges or surcharges or other monetary obligations ilnposeci relativt. to prking lights wit11 respwt to tlie Ilerriised Preniises. Building und Lot shall be considered as 11!jl)ositiolis ;illd sh;lll lw papble 1)y Teiimt under thc provisioiis of Section E hereinahovc. K. IIAMAGE OR DFsTRUCrlON. I. Hecorutnrc-tiotr . If the 1)eniised Premises are daJni1g:d or destroyed during the Term, Landlord shall, except as hereinafter provided, diligently repair or rrl)uild them to substantially the condition in which they' existed isnmediately EO I prior to srrch daniagc. or dcstructioii; provided that any dmiage which is estinutd iri good faith hy Landlord to be under Five Thousand r)(ill;irs ( $5,000.00) sI1a11 be repaired by Teirant, and Landlord shall reimburse Tenant upon demand for expenses incurred in such repair work to the extent of any proceeds received by . Landlord from exteiitled coverage insurance described in Section F-1, L 2. Rent Ahatement. Rent due and payable hereui~der shali be abated proportionately, but only to the extent of any proceeds recrived by Landlord from rental abatement insiirance described ill Section F-3, duriug any period in which, by reason of anv such damage or destruction, Tenant reasona1)ly detemiines that there is substantial interference with the operation of Tenant’s business in the Demised Premises, having regard to the extent to which Tenant may be requircd to ciiscontinue its business in the Demised Premises. Such abatement shall continue for the period commencing with such damage or destruction and ending with a substantial completion by Land!ord , of the work of repair or reconstniction which Landlord is obligated or undertakes to do: If it be determined that continaation of business is not practical pending reconstruction, Fixed Rent due and payable hereunder shall abate to the extent of proceeds from rental abatement insurance until reconstruction is substantially mmpleted or 11 ntii business is totally or partially resumed, whichever is the earlier. 3. Excessioe Darnage or Destruction. If the. Building is damaged or destroyed to the extent that Landlord determines that it cannot, with reasonable diligence, be fully repaired or restored by Landlord within one hundred eighty (180) days after the date of the dilnlage or destruction. the sole right of both Landlord and Tenant shall be the option to terminate this Lease. Notwithstanding the fact that the Demised Premises have not been damaged or destroyed, Laudlord shall detennint whether the Building can be fully repaired or restored within the one hundred eighty ( 180 ) day period, and Landlord’s determination shall be conclusive on Tenant. Landlord shall notify Tenant of its determination, in writing, within thirty (30) days after the date of the damage or destruction. If Landlord determines that the 3uilding can be fully repaired or restored within the one hundred eighty (180) day period, or if it is determined that such repair or restoration CaliROt be made within said period but neither party elects to terminate within thirty (30) day< from the date of said determination, this Lease shall remain ill full force and efiect and Landlord shall diligently repair and restore the damage as soon as reason- ably possible. 4. Uninsured Ccasidalty. Notwithstanding anything contained herein to the contrary, in the event of damage to or destructiion of all or any portion of the Building which is not fuf’iy covered by the insurance proceeds received by Landlord under the insurance policies required under Section F-1 above. Landlord may terminate this Lease by written ilotice to Tenant, given within thirty (30) days after the date of notice to Landlord that said damage or destruction is not so covered. If Landlord does not elect to terminate this Lease, the Lease shall remain in full force and effect and the Building shall be repaired and rebuilt in accordance with the provisions for repair set forth in Section K-1 hereinabove. . 5. Woiwr. With respect to any destruction which Landlord is obligated to repair or may elect to repair terms of this Section K, Tenant hereby waives all right io terminate this Lease pursuant to rights presenfly or hereafter accorded by law to tenants, except as expressly otherwise provided herein. - L. EMINENT DOMAIN. 1. Totd Condeemnutinn of Demised Premises. under the otherwise . If the whole of the Demised Premises is acquired or condemned by eminent domain, inversely CY~- demned or sold in lieu of condemnation, for any public or quasi-public use or purpose (“Condemned”), 0 0 tfieii ttir 'I'eriii shall tenniiiatr ;IS of the date of title vesting iit such proceeding, and lknt shall be adjusted to the date of tcrniinatiott. Teiinnt shall imniediately notify 1,andlord of any such occurrence. 2. Partial Condemnutioti. If ally part of the Demised Premises is pnrti:dly Condemned, and such partial condernnation renders the 1)ernised Premises unusable for the business of the Tenant, then the Term of this Lease shall terminate as of the date of title vesting in such proceeding and Rent shall be adjusted to the date of termination. If condemnation is not extensive enough to render the Demised Premises unusable for the business of Tenant. then Landlord shall proniptl y restore the Demised Premises to a coiidition comparable to its condition immediately prior to such condemnation to the extent of any condemnation proceeds recovered by Landlord, less the portion thereof lost in huch condemnation, and this Lease shall continue in full force and effect except that after the date of such title vesting the Fixed Rent shall be reduced as reasonably determined by Land- 'lord. If any parking areas are condemned, Landlord 'has the option but not the obligation to supply Tenant with other parking areas. 3. Landlord's Awurd. If the Demised Premises are wholly or partially condemned, then, subject to the provision of Section E-4, Landlord sI?rill be entitled to the entire award paid for Such condemnation, and Tenant waives any right or claim to any part thereof from Landlord or the condemning authority. 4. Tenunt's Award. Tenant shall have the right to claim and recover from the condemning authority, but not from Landlord, such cornpensation as may he separately awarded. or recoverable by Tennnt in Tenant's own right on account of any and a11 costs or loss (including loss of business) to which Tenant inight be put in removing Ten2nt's merchandise, fnmiture, fixtures, leasehold improvements and equipment to a new Iocation. 5. Temporary Con&mnatwti. quasi-public use or purpose, this 1,ease shall remain in effect and Tenant shall be entitled to receive for itself s11c1i portion or portions of any ;iw:v;lrd 1ii;tde for such use with respect to the period of the taking which is within the Term. If :i temporsry coiidemnation rernains iit force at the expiration or earlier termination of this Lease, 'Tenant shall pay to Landlord a sum equal to the reasoilable cost of perforniing any obligations required of Tenant hy this Leiist with respect to the surrender of the Demised Premises, including, without limitation repairs and inaiiiteiiaiice required, and upon such payxnent Teuaut shall he excused from aiy such obligations. If it temporary condemnation is for an established period which extends beyond the Term, the Lease sliail terminate as of the date of occupaiicy by the condemning authority, and the damages shall be as provided in Sections L-3 arid L-4 and Hent shall be adjusted to the date of occupancy. . . + If the whole or any part of the Ilemised Premises shall btx coiideriined for any temporary public 6. .'Voticu CI 1 d b:.rc.ctc t i0ll. - Landlord shall. imniediatel y iipori service of process in connection with any condemnation or potential condeniliatioil, give Tenant notice in writiiig thereof. Tenant shall iinmediately execute and deliver to the I,airdlord all instrunleiits that may be required to effectuate the provisions of this paragraph. .hf. &FAULT. 1. Euents of llefcittlfs. Tenant with or without notice from Landlord: The occurreriw of ;illy of the followiiig events shall constitute an "Event of Default" on the pad of ADD~NDUW~ 12 CALIFORNIA a. Vacation or Abandonment. Vacation or abandonment of the Demised Premises; b. ’Payment. Failure to pay any installment of Rent or other monies due and payable hereunder upon the date when said payment is due, the failure continuing for a period of five (5) days dter said payment is due; c. Performance. Default in the performance of any of Tenant’s covenants, agreements or obligations hereunder, except default in the payment of Rent or other monies, the default continuing for thirty (30) days after written notice thereof from Landlord; d, Assignment. e. Bankruptq. A general assignment by Tenant for the benefit of creditors; The filing of a voluntary petition in bankruptcy by Tenant, or the fling of an involuntary petition by Tenant’s creditors immediately unless involuntary, in which case when the petition remains undischarged for a period of thirty (30) days; f. Receiver. The appointment of a receiver to take possession of substantially all of Tenant‘s assets or of this leasehold, the receivership remaining undissolved for a period of thirty (-30) days; or g. Attachment. Attachment, execution or other judicial seizure of substantially all of Tenant’s assets or this leasehold, the attachment, execution or other seizure remaining unaismissed or undischarged for a period of thirty (30) days after the levy thereof. 2. LandlorZs Remedies. a. Abandonment. If Tenant vacates or abandons the Demised Premises, this Lease shall continue in effect. Landlord shall not be deemed to have terminated this Lease other than by written notice of termination from Landlord, and Landlord shall have all of the remedies of a landlord provided by Section 1951.4 of *e Civil Code of the State of California. At any time subsequent to vacation or abandonmeni of the Demised Premises by Tenant, Landlord may give notice of termination and shall thereafter have all of the rights hereinafter set forth. Following the occurrence of any Event of Default, Landlord shall have the right, so long as the default continues, to terminate this Lease by written notice to Tenant setting forth: (i) the defadt, (ii) the requirements to cure it, and (iii) 2 demand for possession, which shall be effective three (3) days after it is given or upon expiration of the times specified in Section M-l hereinabove, whichever is later. c. Possession. Following termination under paragraph b, without prejudice to any other remedies Landlord may have by reason of Tenant’s default or of such termination, Landlord may then or at any the thereafter, (i) peaceably re-enter the Demised Premises, or any part thereof, upon voluntary surrender by Tenant or expel or remove Tenant therefrom and any other persons occupying them, using such legal proceed- ings as are then available; (ii) again repossess and enjoy the Demised Premises, or relet the Demised Premises or any part thereof for such term or terms (which may be for a term extending beyond the Term) at suck, rental or rentals and upon such other tenns and conditions as Landlord in its sole discretion shall determine, with the right to make reasonable alterations and repairs to the Demised ?remises; and (iii) remove all personal property therefrom. Recovery. Following termination under paragraph b, LandIord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California. The amount of damages which Landlord may recover following termination under paragraph b. shall include the worth at the time of the award of the amount by which the unpaid Rent for the balance of the term after the time of award exceeds the amount of rental loss Tenant proves could be reasonably avoided. . b. TemimtOn. d. e. Additional Renzedies. In addition to the foregoing remedies, Landlord shd, so long as this Lease is not terminated, have the right to remedy any default of Tenant, to maintain or improve the Demised 13 \ 0 .. Premises without terminating this Lease, to incur expenses on behalf of Tenant in seeking a new subtenant, or to ca1:s.j a rewiver to be appointed to administer the Demised Premises and new or existing subleases, and to add to the Rent payable hereunder all of Landlord's reasonable costs in so doing, with interest at the f. Other. E Tenant causes ox threatens to cause 2 breach of any of the covenants, agreements, Perms or conditions contained in this Lease, Landlord shall be entitled to obtain all Sums heId by Tenant, by any trustee or in any account provided for herein, to enjoin such breach or threatened breach, and to invoke any right and reniedy allowed at law or in equity or by statute or otherwise as though re-entry, summary proceed- ings and other remedies were not provided for in this Lease. g. Cobmubatiw. Each right and remedy of Landord provided for in this Lease shall be cumulative and shall be in addition to every other right or remedy provided for in this Lease or now or hereafter existing .at law or in equity or by statute or otherwise. The exercise or beginning of the exercise by Landlord of any OIIC or more of the rights or remedies provided for in this Lease, or now or hereafter existing at law or in equity or by statute or otherwise, shalt not preclude the siiultaneous or later exercise by Landlord of any or dl other rights or remedies provided for in this Lease or now or hereafter existing at law or in equity or by statute or otherwise. * maximum rsfe permitted by law from the date of stlch expenditure until the same is repaid. h. No Wa'aioer. No fxiure by Landlord to insist upon the strict performance of my term hereof OF to exercise my sight or remedy consequent upon a breach thereof, and no acceptance ob full or partid pay- ment of Rent during the continuance of any such breach, shall constitute a wdver of any such breach OF of any such tem. E&xts by Landlord Po mitigate the damages caused by Tenm3s breach of &is Lease shdl not be cmstrued to be a waiver of LandKord's dght to recover damages under ti& Section M. Nothing in this Section M affects the right of Landlord to indemnification by Tenant in accordance with Section F-8 herehbove %or hbiky arising prior to the termination of this Lease €or personal injuries or property damage. Tenant sh& not assign, mortgage, pledge or otherwise transfer, this Lease, in whole ox in part, nor sublet or permit mnpnracy by my party other than Tenant of all or any part of the Demised Premises, wi&ont the prior written ament 0% Landlord in each i?stance. Any purported assignment or subletting conkary to the provisions hereof without conseat shall be: void. Thz eonsent by Landlord to any assipmnt ot subletting shall not constitute a waiver of the necessity fop such consent to any sabsequent assignment or subletting. As Additiond Bent hereunder, Tenant shall reimburse Landhrd for reasonable legal and other expenses inwed by Lmdord in connection with any request by Tenant for coasent to assignment or subletting. - 2, LanrMsrd Optton. 8. Xn connection with any proposed assignment or sublease, Tenant shall submit to Landlord in writing -(i) the name of the proLmsed assignee or sublessee, (ii) such information as to its financial responsibility and standing as Landlord may reasonably require, and (iii) all of the, terms and conditions upon which the propsd assignment or subletting is to be made. Landlord shall have an option to cancel and terminate this Lease, if the request is to assign the Lease or to sublet all of the Demised Premises; or, if the request is to sublet a portion of the Demised Premises only, to cancel and terminate this LCase with respect to such portion. Landlord may exercise said option in writing within thirty (30) days after its receipt from Tenmt of such request, and in each case such cancellation or termination shall occur as 6f the date set forth in Landlords notice of exercise of s~ach option, which shall be not less than sixty (60) nor more than one hundred-twenty (120) days following the giving of such notice. 14 b. Cancellation. If Landlord shalI exercise its option, Tenant shall surrender possession of the entire Demised Premises, or the portion tbereof whicb is the subject of the option, as the case may be, on the date set forth in such notice in accordance with the provisions of this Lease relating to surrender of the Demised Premises at the expiration of the Term. If this Lease is cancelled as to a portion of the Demised Premises only, the Fixed Rent after the date of cancellatioh shall be abated and shall thereafter be an amount deter- mined by Landlord and the Tenant's Share of Impsitions, Tenant's Share of Operating Expenses and Tenant's Share of Insurance Expenses shall be adjusted as reasonably determined by Landlord. c. Noncancellation. If LandIord does not exercise its option to cancel this Lease pursuant to the fore- going provisions, Landlord may withhold its consent to such assignment or subletting, as long as the withhold- ing is not done unreasonably. d. Asamption. No assignment shall be binding upon Landlord, any ground lessor or any mortgagee unless Tenant shall deliver to Landlord an assignment in recordable form which contains 2x1 assumption by the assignee, but the failure or refusal of the assignee to execute such instrument or assuiiption shall not release or discharge assignee from liability as Tenant hereunder, provided that the tenns and provisions of the assignment or subletting shall specifically make applicable to the assignee or sublessee all of the provisions of this Section. . 3. Boiaw Rental. If for 2ny assignment or sublease, Tenant receives rent or other consideration, either initially or over the term of the assignment or sublease, ii1 excess of the Rent called for hereunder, or in case of the sublease of a portion of the Demised Premises, in excess of such Rent fairly allocable to weh portion, after appropriate adjustments to assure that all other payments called for hereunder are appropriately taken into account, Tenant shall pay to Lnndlord, as Additional Rent hereunder, one-half (M) of the excess of each such payment of rent or other consideration received by Tenant promptly after its receipt. 4. Scope. The prohibition against assigning or subletting cwntained in this section shali be construed to include a prohibitiuon against any assignment or subletting by operation of law. If this Lease be assigned, or if the under- lying beneficial interest of Tenant be transferred, or if the Demised Premises or any part thereof be sublet or occupied by anybody other than Tenant, Landlord may collect rent €room the assignee, subtenant or occupant and apply the net amount colIected to the Rent herein reserved and apportion any excess rent so collected in accordance with the terms of the immediately preceding paragraph, but RU such assignment, subletting, owu- pancy or collection shall be deemed a waiver of this covenant, or the acceptance of the assignee, subtenant or occupant as tenant, OF a release of Tenant from the further performance by Tenant of covenants on the part of Tenant herein contained. No assignment or subletting shall affect the continuing primary liability of Tenant (which, following assignment, shall be joint and several with the assignee), and Tenant shall not be released fmm performing any of the terms, covenants and conditions of this Lease. 5. Waiwr. , Notwithstanding any assignment or sublease, or any indulgences, waivers or extensions of time granted by Landlord to any assignee or sublessee, or failure by Landlord to take action against any assignee or sublesee, Tenant waives notice of any default of any assignee or sublessee and agrees that Landlord may, at its op6on, proceed against Tenant witj.orit having taken action against or joined such assignee or subleasee, except that Tenant shall have the bewfit of any indulgences, waivers and extensions of he granted to any mcR assignee or srrb%essee. 6. Helaw. Whenever Landlord conveys its interest in the Lot, Landlord shall be automatically released from the further performance of covenants on the part of Landlord herein contained, and from any and all further liability, obligations, costs and expenses, demands, causes of action, claims or judgments arising from or grow- ing out of, or connected with this Lease after the effective date of said release. The eEective date of sdd release shall be the date the assignee executes an assumption of such an assignment whereby the assignee expressly agrees to assume all of Landlord's obligations, duties, responsibilities and liabilities with respect to this Lease. If requested, Tenant shall execute a form of release and such other documentation as may be re- quired to further effect the provisions of this Section. 0. OFFSET STATEMENT, ATTORNMENT, AND SUBORDINATION. 1. Offset Statement. Within ten (10) days after request therefor by Landlord, or if on any sale, assignment or hypothecation by Landlord of its interest in the Deinised Premises, or any part thereof, an offset statement shall be required from Tenant, Tenant shall deliver, in recordable form, a certificate to any proposed'mortgagee or purchaser, or to Landlord, certifying (if such be the case) that this Lease is in full force and effect; the date of Tenant's most recent payment of Rent, and that there are no ddenses or offsets outstanding, or stating those claimed by Tenant. Tenant's faihre to deiiver said statement in time shall be conclusive upon Tenant that: (i) this Lease is in full force and effect, without modification except as may be represented by Landlord, (ii) there are no uncured defaults in Landlord's performance and Tenant has no right of oEset, counterclaim or deduction against rent hereunder, and (iii) no more than one period's Fixed Rent has been paid in advance. 2. Attornment. Tenant shall, in the event any proceedings are brought for the foreclosure of, or in the event of exercise of the power ol sale urider, any mortgage or deed of trust made by the Landlord, its successors or assigns, encumbering the Demised Premises, or any part thereof, or in the event of termination of the Ground Lease, if any, and if so requested, attorn to the purchaser upon such foreclosure or sale or upon any grant of a deed in lieu of foreclosure and recognize such purchaser as the Landlord under this Lease. 3. SrabmdiE'P1Qbisn. The rights of Tenant hereunder are arid shall be, at the election of any mortgagee, subject and sub- ordinate to the lien of any mortgage or mortgages, or the lien resulting from any other method of financing or refinancing, now or hereafter in force against the Lot and/or Building of which the Demised Premises are a part, and to all advances made or hereafter to be made upon the security thereof, provided, however, that notwitlistanding such subordination, so long as the Tenant herein is not in default uniier any, of the terms, covenants and conditions of this Lease, neither this Lease nor any of the rights of Tenant hereunder upon Tenant's covenanting that Tenant is not in default hereunder, shall be terminated or subject to termination by any trustee's sale. any action to enforce the security, or by any proceeding or action in foreclosure. If requested, Tenant agrees to esecute whatever documentation may be required to further effect the provisions of this section. I P. NoncEs. All notices required to be given hereunder shall be in writing and mailed postage prepaid by certified or registered mail, return receipt requested, or by personal delivery, to the addresses indicated in Section A-1 or at such other place or places as either Landlord or Tenant may, from time Po time, respectively, designate in a witten notice given to the other. Notices shall be deemed sufficiently sewed four (4) days after the &te of mailing thereof. 18 I 0 Q. MISCELLANEOUS. 1. Waiver. No waiver of any default or breach of any covenant by either party hereunder shall be implied from any omission by either party to cake action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the waiver, and then said waiver shall be operative only for the time and to the extent therein stated. Waivers of any covenant, term or condition contained herein by either party shall not be construed as a waiver of any subsequent breach of the same covenant. term or con’dition. The consent or approval by either party to or of any act by either party requiring further consent or approval shall not be deemed to waive or render unnecessary their consent or approval to or of any subsequent similar acts. . 2. Accord and SaMsfaction . No payment by Tenant or receipt by Landlord of a lesser amount than the Rent payment herein stipulated shall be deemed to be other than on account of the Rent, nor shall any endorsement or statement on any check or any letter accompanying any check or payment as Rent be deemed an accord and satisfaction, and Landlord may accept such check or payment without prejudice to Landlords right to recover the balance of such Rent or pursue any other remedy provided in this Lease. 3. Limitation of Landlords Liability. The obligations of Landlord under this Lease do not constitute personal obligations of the indivklud partners, directors, oEcers, or shsreholders of Landlord, and Tenant shall look solely to the real estate that is &e subject of this Lease and to no other assets of the Landlord for satisfaction of any liability in respect of this Lease and wilI not seek recourse against the individual partners, directors, ofhers or shareholders of Lendlord or any of their personal assets for such satisfaction. * 4. Entire Agreement. . This Lease sets forth all the covenants, promises, agreements, conditions and understandings between Landlord and Tenant cancerning the Demised Premises, Building and Lot, and there are no covenants, promises, agreements, conditions or understandings, either oral or written, between them other than as are herein set forth. Except as herein otherwise provided, no subsequent alteration, amendment, change or addi- tion to this Lease shall be binding upon Landlord or Tenant unless reduced to writing and signed by them 5. Time. Time is o€ &e essence hereof. 6. Sfmrt Fom Leczse. 1 Concurrently Rcrewith the parties may, at the option of either party, execute a short form of Lease for recarding. This Lease and any such short form of Lease shall be construed together as one instrument. Neither Landlord nor Tenant shall record this Lease nor permit the same to be recorded without the written consent of the other, but shall Rave the right to record any such short form. 7. Attorneys’ Fees. In any action or proceeding which the Landlord or the Tenant may be required to prosecute to enforce its respective rights hereunder, the unsuccessful party therein agrees to pay a11 costs incurred by the pre- vailing party therein, including reasonable attorneys’ fees, to be fixed by the court, and said costs and attorneys’ fees shall be made a part of the judgment in said action. In any situation in which a dispute is settled other than by action or proceeding, Tenant shall pay a11 Landlord’s costs and attorneys’ fees relating 4 , theF&O. 8. Captions and Sectbit Mumhen. The captions, section numbers, article numbers and index appearing ill this 1,ease are iiisertt:d only as ii ma,tter of convenience 2nd in no way define, limit, construe or describe the scope or intent or slich sectioiis or articles of this Lease nor in any way affect this Leas;. 9. Severability. If any term, covenant, condition or provision of this Lease, or the application thereof to any person or circumstance, shall to any extent be held by a caurt of competent jurisdiction to be invalid, void or unenforce- able, the remainder of the terms, covenants, conditions or provisions of this Lease, or the application thereof to any person or circumstance, shall remain in full force and effect 2nd sh2U in no way be affected, impaired or invalidated. . 10. AppUctrbk bw. cordance with the laws of the state in which the Demised Premises are located. .. This Lease, and the rights and obligations of the parties hereto, shall be construed and enforced in ac- 11. Exaamirution of .&me. Submission of this instrument for examination or signature by Tenant does not constitute a reservation of QP option to Lease, and it is not eRective as a Lease or otherwise until execution and delivery by both Eandord and Tenant. (SEE ADDENDUkU . 33. SU~SORSBOUND. This Lease and each of its covenants and conditions shall be binding upon and shall inme to the benefit of the parties hereto and their respective heirs, successors and legal representatives and their respective assigns, subject to the provisions hereof. Whenever in this Lease a reference is made to the Landlord, such reference shall be deemed to refer to the person in whom the interest of the Landlord shall be vested, and Landlord shall have no obligation hereunder as to any claim arising after the transfer of its interest in the Demised Premises. Any successor or assignee ef the Tenant who accepts an assignment or the benefit of this Lease and enters into possession or enjoyment hereunder shall thereby assume 2nd agree to perfom and be bound by the covenants and conditions thereof. Nothing herein coiltained shall be deemed in any manner to give 2 right of assignment to Tenant without the written consent of Lanc3ord. IN Wmms WHEREOF, the parties have executed this Lease as of the date erst above written. ......................................... hetest: ... ... ‘I .- . ., By ........................................ . ;’ i. .... ,,, ............................. ‘TENANTn 3 .............................................. By .......................................... ....................................... STATE OF COUNTY OF e' 1 ss. On , before me, the undgrrsigned, a Notary Public in and for said State, personally appeared , known to me to be the and of , the. corporation that executed the within instrument, known to me to be the persons who executed the within instrument on behalf of the corporation therein named, and acknowledged to me that such corporation executed the within instrument pursuant to its by-laws or a resolution of its board of directors. WI~ESS my hand and official seal. STATE OF COUNTY OF ............................................... Notary Public } ss. , before me, the undersigned, a Notary Public in and for said State, personally , known to me to be the and Of , the corporation that executed the within instrument, known to me to be the persons who executed the within instrument on behalf of the corporation therein named, and acknowledged to me that such corporation executed the within instrument pursuant to its by-laws or a resolution of its board of directors. Wmms my hand and official seal. % .............................................. Notary Public 19 . .. t -4 20. zo b Future Development 65 0 Acres ITE C, CARLSBAD, CALIF 92008 TCI t-DUC\AIZ 1714) A'lR 3GG7 i 0, These multi-occupancy buildings are ideal for light manufacturjng, warehouse distribution or research and development. Units are available from 1,600 square feet in building $9 and 5,760 square feet in building #IO with office space suited to individual needs. The design provides flexible space finished to the requirements of the tenant. Palomar Airport Business Park is master planned to provide an excellent work environment at competitive rates. Tilt-up concrete construction with canopy over private entrance. Space available from 1,600 to 42,480 square feet. Custom or standard interior office improve- ments constructed to meet client require- ments. Site designed for easy truck access. Building #9 has 10 ft. by 10 ft. grade level overhead doors. Building #lO has 20 A. by 10 ft. over- head truck high doors in each unit. B Ample on-site automobile parking. E4 A clear ceiling height of 16 ft. in building #9 g:r;:&r?g E'?? &3s'es and 22 ft. in building # 10. Fully monitored fire sprinkler system. Continuous strip fluorescent lighting on 20 ft. centers in building $9 and on 24 ft. centers in building #4 10. FB Landscaped site. &Ei.rdtiola rc2iu re5 B Central location in North San Diego County, one of the fastest growing areas of California. 35 minutes from downtown San Diego. 10 minutes to key North County communities. 35 minutes to San Diego international airport and the port of San Diego. E All weather FAA-operated airport next to the park with 4,700 ft. runway, accommodates air- craft up to DC-9. €53 1.6 million population in county, 890,000 in city of San Diego (the 9th largest city in the United States). E4 Within 1% hr. drive of the Los Angeles metro- politan area with more than 11 million popu- lation. 1 hr. to Orange County. Diversified labor force of half a million. 1% miles from Interstate 5 2nd 2 miles from the Pacific Ocean. @ Located 1 mile from the La Costa resort com- munity. Major companies in area include Burroughs Corp., Hughes Aircraft, Beckman In- struments, U.S. Foam, Dyna-Med, Lockheed and Anthony Industries. @ Palomar Airport Business Park is a 340 acre master-planned industrial park which opened in 1975. EB A partnership of Mitsui & Co. (USA), Inc. and Mitsui Fudosan (USA), Inc. . Contact: Palomar Airport Business Park or your real estate broker. I I 6231 YARROW DR., SUITE C CARLSBAD, CA. 92008 TELEPHONE (714) 438-2552 The promjses, covenants, agxements 2nd declarations made 2nd set forth herein are intended to and shall have the same force and effect 2s if set forth at 7engh in the hdp of the lease to which this Addendum js azl&.ci;ed (rhz "kzse"). zr- inconsisrent ii-ith the terms and contiiriorts of the Lease, the ~erms he)-eof ' TO the extent that the provis5ons of thjs Add~ntiurn shall ConiTol: 1, Secrion B-3. The priod at the end of Seciion B-3 is hereby ct;ang;ed io a comma 2nd the follo\i~ing lanpzge is hereby added thereto: "unless within such skih (6ih) month wriod the Demised Fremisss tecome "ready for occupancy" as defined in Section €3-5 Ixfow. 2, Section F-7. Section F-7 js h3rebj7 retit'fed to read: "Temnt's FroprV'' and th2 12np2ge of ssjd Section is hereby revised to zead as follov:~: "TeGani 'shall assume the risk of damage to any fixrures, goods, invcnic)q, *hierchan- . a: se, equipment, furniaure and leasehaid iii-~proven-ients which remain the pi-~~periy of Tenant or as to which Tenant retains the right of remol-a1 from the Demised Premises, and Tenant shall main:ain reasonable insurance coLerage with respct to such irems dnring the Terfn of ihis hzse. '' ..- -- 3. Secrion G-2 -___ ITith I-eference to Seciion G -2, the follouving !2.nam2ge is herzby added thereto: affirmative responsibility with resFct to either Far9 in connection with repziirs to the walls of the D?mised Fremises relating lo maiurity or ivcathzring of constiuction materials 2nd conii-~sred to dzmzge lo the stixctural integrity 05 rhe building v.-slJs. Furih=.r, Landlord covenants that it shall ob:ain from :he coniractor who constructs the Improvements upon the Demised Pi-en;ises a v;arranry in the usual folm zgainst d?fectixie \i.orkrr*znship and materials for a priod of one (1) year fr-om the commencement of the Term. 1~arranty p-:i-iod, said warranty shall fx for the lxrjefit of Tc-nznt, to the exient that it covers any defects in the Improvements which Tenant is required to repair hereunder. " "Tefianr expressly unCerstands thar there shall lx no During said Section hl: -1. The to a priod and the Semicolon following SuSsection h3-1 (b) is hereby changzd fo17ois.ing sentence is hereby added at the end of said Scb- section: t7$70 (2) months in a row then Rent shall h2come due and payable quhrterly in advance on the first day of each calendar quarter during the follo\i-ing on2 (1) year p2riod of the Term of the Lezse, affer whjch year Rent shall again k payable monthly 2nd this Section shall again bi: in effect. *' "Should there k consecutive failure to pay such installments for 5. Section 4-12. - A now Section Q-12 is added entitled "Financial Staieimgnts" and contains the following languege: "At an37 time during the Term of the Lease, Tenant shall, upon thii-ty (30) days' prior u-ritten notice from Lindlord in connection with any financing of the Demised €3-emisns, provide Landlord with a current ficancial statement and finsncial statements for each 'of thz two (2) years prior to the current financial statement year. Such staienents shall le prepared in accordance with generally accepted accounting principles and shall be audited by independent certified public accountants if such is the normal pracrice of Tenant. 91 .. .. 6. Section 4-13. A new Section 4-13 entitled "Rent Commencement Date" is added hereto 2nd contains the following languase: "Landlord and Tenant hereby agree that upon determination of tile acrual Commencement date of the Term, a letter shall issue from Landlord ivhich will b? countersigned by Tecant and which shall identify the acmal corrjmencement dare of Fixed Rent. .. . . ... . 7. Section 0-14. ' A new Section Q-14 entitled "Surrender of Premises; Holding Over" is added hereto and contains the following language: of ten (IO) days after termination of the Term, Tenant shall surrender to Landlord the Dmiised Premises and all Tenant's improvements and alterations in good condition (except for ordinary wear and Tear occurring after the last necessary maintenance made by Tenant and except for destruction of the Demised Premises covered bj7 Article K) except for alterations that Tenant has the right to remove or is obligated to remove afier thk provisions of Article 13. Tenznt shall remove all its p-.rsonal prop?rty within the ahve stated time wi-iod. Tenant shall pzrfoim all restoration made necessary by the removal of any alterations or Tenant's prsonal property ii-ithin the time priod stated in this Section. or Tenant's pc-rsonal property that Tenant doss not remove from zhe.Demis-d Premises on expiration or termination of the Term as allowed or required by "On expirztion Landlord can elect to retain or dispose of in any manner any alterations ADD E N D UhI Psnr. 3 nf A thj5 1,case by givirig at Ic-zst Ten (30) 62)'s norice to Tenant. alte~ ations or Tc-rrant's pc-rsonal prop3rt)' that Eandloi-d elects to retain or dispose of on expiration of the ien (IO) day gi-iod shall vest in Landlord. Tenant waives all claims against LandJord for any damage to 'Tenant resulting from Landlord's retention or disposition of any such alterations or Tenant's pzrsonal properly. Tenant shall be liable to Landlord for Landloi-d's costs for storing, removing and disposiqg of any alieratjons or 'Tenant's p2rsonal projxrty. If Tenant fails to surrender the Demised Premises to Landlord on expira7ion or ten (IO) days after termination of the Term 2s required by this Section, Tenant shall hold hr~dlOrd harmless from all damages resulting from TenLint's failure to surrender the Demised FI-emises inc!uding wirhout 1imi:ation claims made by a succeeding Tenant resulting from Tenant's failure to surrender the Demised Premises. Title to any such .I ._. ._ ..- .- - 8. Section Q-15. A new Section Q-15 entitled "option to Extend" is added hereto and contains the follo\i7ing lanpage: "Landlord hereby grants to Tenant an optiom to extend the Term of this Lezse for a psriod of one year exercisable upon prior written notice from Tenant to Landlord delivered not less than four (4) months prior to the expiration of the Term of this Lease. The option is exercisable only so long as Tenant is in possession of the Pi-em'ses 2nd has not sublet the Premises or assigned its position in this Lease. The Fixed Rent payable bj7 Tenant during the extended term shall h increased in proportion to any increase in the Consumer Price Index (all i~ems: Los AnFles/Long Beach Area) ( 'Index") as published by the United Slates-Department of LaSor for the first month of the extended teim in relation to the Index published for The first month of the original Term of the Lease but in any event, the Fixed Rent payab:e during the extended term shall k no less chan tk Fixed Rent payzble during the original Term of the Lease." IN WITNESS WHEREOF, the parties have executed this Addendum as of th? d2y and year first above written. ADDENDUM Page 3 of 4. Date PALOMAR 910 - BERNARD w. GILMORE BY Bernard W. Gilmore Its "L,4h?LORD" .Date .. .. . THE CITY OF CARLSBAD BY -. Ruth S. Fletcher Its: "TEN ANT" , ADDENDUM Pncr~ 4 nf 4.