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HomeMy WebLinkAbout2001-06-26; City Council; 16244; Ground Lease Agreement Pine School PropertyAB# b, &Ill MTG. b-&&l DEPT. Recreation CITY OF CARLSBAD -- AGENDA BILL : TITLE AMENDMENT TO THE EXPIRATION TERMS OF THE GROUND LEASE AGREEMENT WITH CARLSBAD UNIFIED SCHOOL DISTRICT I FOR SPECIFIC PORTIONS OF THE PINE I CITY MGR.a SCHOOL PROPERTY If Council concurs, adopt Resolution No. ml- 163 authorizing an amendment to the terms of the existing ground lease agreement with Carlsbad Unified School District (CUSD) to extend the vacation dates for their use of the Carlsbad Village Academy component and the Maintenance and Operations yard at the Pine School property. ITEM EXPLANATION : On October 5, 1999, City Council adopted Resolution 99-455 approving the Agreement for Sale of Real Property and a Ground Lease Agreement for the Pine School Site. In essence, the Ground Lease allowed CUSD to maintain use of the site for the Carlsbad Village Academy (CVA) and for its Maintenance and Operation component until relocation sites could be secured for those functions. Although CUSD has received rent free use of the site to date, the terms of the existing lease are to expire on June 30, 2001. Under existing terms, if CUSD has not vacated the site by June 30, they are responsible for a significant retroactive lease payment of approximately $48,000. In addition, they would be responsible for a monthly rent of approximately $3,700 beginning July 1,200l. Over the past 15 months, attempts by CUSD to secure suitable and affordable locations for the CVA and maintenance functions have been challenging. However, in the past several months, the district has been actively engaged in that process and has made eventful progress. Most notably, CUSD has purchased a facility which will consolidate the maintenance and operation function, a warehouse and district offices. Accordingly, relocation of the maintenance component at Pine School is anticipated and scheduled to occur by December 2001. More recently, the Carlsbad Unified School District Board of Trustees have taken action to approve the relocation of the CVA to District owned property on Magnolia Avenue across from Valley Jr. High School. The District has prepared a project schedule for development of a facility which will accommodate the CVA component. Although development of such a facility may be subject to delay, CUSD expects construction to end and occupancy to occur by the Fall semester of 2002. In an attempt to work collaboratively and assist CUSD, City staff is recommending to extend the vacation dates outlined in the existing Ground Lease to a date which would more accurately reflect a timeline that meets the Districts current efforts. Consequently, the recommendation would be to extend the vacation date for the maintenance component not to exceed December 31, 2001. With respect to the vacation date for the CVA component, staff recommends extending the date not to exceed December 31,2002. Staff further recommends that in order to promote timely progress in project completion and thereby insure vacation of the Pine School site, the District be required to meet the timelines of AB# h WJ Page 2 project construction according to the project schedule as submitted to City staff on May 11, 2001 (Exhibit 2). Periodic review of construction progress will be evaluated by the City Manager or his appointed designee. If it is determined at anytime that adequate progress according to events and timelines outlined in the project schedule is not being achieved, the expiration amendment would revert to the original terms of the agreement. Accordingly, in the absence of scheduled progress, the District will be responsible for retroactive lease payments (holding over rents) and monthly rental rates identified in the original terms of the Ground Lease. If Council concurs, an amendment to the existing Ground Lease with CUSD, outlining the terms above will be prepared for acceptance by both the City and CUSD. Acceptance by both parties shall constitute an amendment to the formal Ground Lease between the City and CUSD as notarized on September 23, 1999. FISCAL IMPACT : Extending the vacation dates identified in the existing Ground Lease would toll any potential hold over rents and monthly rentals for a period not to extend beyond December 31, 2001 for the Maintenance and Operation component and beyond December 31,2002 for the CVA component. EXHIBIT : I. Resolution No. 6200 \ -I q7 2. Project Schedule for CUSD Facility Construction and Relocation 3. Ground Lease Agreement Between City of Carlsbad and CUSD 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 RJBOLUTION NO. 2o01-187 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, authorizing an amendment to the terms of the Ground Lease Agreement and extend the expiration date for Carlsbad Unified School Districts’ present use of the Pine School property for the Carlsbad Village Academy and the Maintenance and Operation function. WHEREAS, the City of Carlsbad and the Carlsbad Unified School District (CUSD) currently maintain a Ground Lease for CUSD’s functions of the Carlsbad Village Academy (CVA) and the maintenance and operation component on the Pine School property, and WHEREAS, the terms of the existing lease are due to expire as of June 30,200l; and WHEREAS, CUSD is actively engaged in the relocation efforts of both of those components to an off-site location; and WHEREAS, the City of Carlsbad desires to extend the terms of the current lease in an effort to assist CUSD in supporting their relocation efforts in accordance with the achievement of scheduled progress towards construction of facilities and subsequent timely relocation of the maintenance function and CVA component; and WHEREAS, the Carlsbad City Council desires to extend the vacation dates outlined in the existing Ground Lease via an amendment to the lease with CUSD and that such an amendment shall constitute a formal amendment to the existing Ground Lease acknowledged by both parties. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California, the following: 1. That the above recitations are true and correct. 2. That the extension of the vacation date of the CUSD’s maintenance function at the Pine School property is hereby extended to not later than December 3 1,200l. 3. That the extension of the vacation date of the CUSD’s Carlsbad Village Academy component on the Pine School property is hereby extended to not later than December 3 1,2002. 4. That all other terms and conditions outlined in the existing Ground Lease shall remain in effect with exception of the afore mentioned vacation extension dates. 5. That the City Manager or his authorized representative is hereby authorized to evaluate CUSD’s facility development progress according to the project(s) 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 schedule(s) attached hereto and made a part hereof in order to insure that adequate progress is being completed in a timely manner. 6. If it is determined at anytime that adequate progress is not being made according to the project(s) schedule(s) submitted by CUSD, that the amendment submitted ta CUSD amending the expiration dates shall also grant the City of Carlsbad the right to invoke the original terms of the agreement and thereby implement a retroactive lease payment (hold over rent) and collect a monthly rent from CUSD according to the original terms outlined in the lease agreement. 7. The City Manager is hereby acknowledged as the City’s authorized representative to execute the amendment to the existing Ground Lease extending the lease expiration date with CUSD. PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City of Carlsbad on the 26th day of June ,2001, by the following vote to wit: AYES: Council Members Lewis, Kulc NOES: None. ABSENT: None. ATTEST,: &X&$NE M. WOOD, City Clerk (SEW -2- II EXHIBIT 2 B/t? SfiEd! CZ9 Wr f 1S:L lO,mi 11 It2 lPPPlSBS8 5 !alN :/la $lJS! =: m. : : I : : : : : : : ; i ! : j : : : : : ; : ! : : : * : : , : : : ! 0/P a6ed! 13 WI- !ZS:L lO,~W 11 !E LPPP LSESB ; ; ; ; j : : ; * , . , . * I . , : . ’ : ’ I : : : ’ : ’ ’ : : : : : : . ; ; , , , , . . . : I : : I I * # , . , ; : I : : : I : : : : : ; I a * , : : . , , , . . . . I * : , , . . . # . . . . . . . . . . . . ..I.... a..,.... . . . . . . . . . . . . . . I... 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I , . : : b 5 P f r I ; I 1 ? r : / !E LPW LS9S9 4 !alN :A8 wat GROUND LEASE AMENDMENT This Ground Lease Amendment dated ay 25. 7001 between the City of Carlsbad ("Landlord" or "City") and Carlsbad Unified School District ("Tenant" or "District") shall effect the lease terms and provisions of the original Ground Lease dated September 23, 1999 between the City and District for certain portions of the Pine School property. Specifically, the following lease terms and provisions requiring amendment are the lease expiration dates identified in the following article(s) and section(s), they include: . Article 2.3(2) CVA Component . Article 2.3(3) Maintenance Yard Component . Article 2.20(b) Holdina Over/CVA Component . Article 2.20(c) Holdina OvedMaintenance Yard ComDonent Accordingly, the following amended lease terms and provisions are acknowledged and agreed to by the City and District to read as follows: 2.3(2) CVA Component: The term of this Lease shall expire as to the CVA Component on December 31,2002. There shall be no extensions of the Term. 2.3(3) Maintenance Yard Component: The Term of this Lease shall expire as to the Maintenance Yard Component on December 31,2001. There shall be no extensions of the Term. 2.20(b) CVA Component. In the event Tenant fails to vacate the CVA Component at the end of the Term (Le., December 31,2002), Tenant shall be liable for and shall pay to Landlord upon demand: (i) a rental for the CVA Component in the amount of One Thousand Seven Hundred Twenty-Five Dollars ($1,725.00) per month (the "CVA Holding Over Rent"), retroactive to the Commencement Date and continuing every month until Tenant vacates the CVA Component, which is based on a rent of $0.75 per square foot times 27,600 square feet for an annual rent of $20,700 per year, which shall be increased by fifteen percent (1 5%) per year thereafter until Tenant vacates the CVA Component; and (ii) all damages incurred by Landlord by reason of the inability to deliver possession of the Property or any portion thereof to any other person. 2.20(c) Maintenance Yard Component. In the event Tenant fails to vacate the Maintenance Yard Component at the end of the Term (i.e., December 31, 2001), Tenant shall be liable for and shall pay to Landlord upon demand: (i) a rental for the Maintenance Yard Component in the amount of One Thousand Five Hundred Dollars ($1,500.00) per month (the "Maintenance Yard Holding Over Rent"), retroactive to the Commencement Date and continuing every month until Tenant vacates the Maintenance Yard Component, which is based on a rent of $0.75 per square foot times 24,000 square feet for an annual rent of $18,000 per year, which shall be increased by fifteen percent (15%) per year thereafter until Tenant vacates the Maintenance Yard 1 Component; and (ii) all damages incurred by Landlord by reason of the inability to deliver possession of the Property or any portion thereof to any other person. All other terms and provisions of the original lease agreement with the exception of the above amendments shall remain in effect as stated in the original document. In witness whereof, the parties have executed this lease amendment as of the date set forth above. CITY OF CARLSBAD AUTHORIZED REPRESENTATIVE A A ATTEST: 2 Lorraine M. Wood, City Cle'rk CARLSBAD UNIFIED SCHOOL DISTRICT AUTHORIZED REPRESENTATIVE BY: Gamreernan, Assistant Superintendent, Business Services ATTEST: ~&.uL,&&J 4dith Cunniff, A&i<istrative Assistant, Business Services RONALD R. BALL, CITY ATTORNEY: n /d-rZk Approve As To Form 7 4-1. 2 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: City of Carlsbad Carlsbad, California 92008-1989 1200 Carlsbad Village Drive Attention: City Attorney FREE RECORDING GOVERNMENT CODE SECTION 6103 CITY 08 CAIUlsBAD CARLSBAD UNIFIED SCWOOL DISTRICT . TABLE OF CONTENTS . ARTICLE 1 FUNDAMENTAL INFORMATION ........... 1 I3g.C ........ ~ 1.1 Landlord ................ 1 1.2 1.3 Tenant 1 Commencement Date ............ 1 1.4 The Premises .............. 1 1.5 Term .................. 1 1.6 Landlord's address for notices ..... 2 1.7 Tenant's address for notices ...... 2 1.8 Tenant's rent .............. 2 1.9 The specified use of the Property .... 2 ARTICLE 2 LEASE TERMS AND PROVISIONS .......... 2 2.1 Agreement to Lease ........... 2 2.2 Acceptance of Property 3 ................. ......... 2.3 2.4 Term 3 ................ 2.5 Basic Rent 5 Additional Rent ............. 5 2.6 Rent Generally ............. 5 2.8 2.7 Tenant Work 6 Use ................... 6 2.9 Compliance with Law ........... 6 2.10 Alterations and Additions 6 2.11 Repairs ................. 6 2.12 Taxes .................. 7 2.12.1 Notice of Possessory Interest ...... 7 2.13 2.14 Prohibition Against Transfers 8 2.15 Hold Harmless 8 Ownership of Property .......... 10 2.16 Liens .................. 11 2.17 Subrogation ............... 11 2.18 Insurance ................ 11 2.19 Utilities ................ 13 2.20 Holding Over .............. 13 2.21 Entry by Landlord ............ 15 2.22 Damage, Reconstruction ......... 16 .................. ............... ........ ...... .............. 2.23 Default ................. 17 2.24 2.25 hninent Domain 19 Estoppel Offset Statement ........ 19 2.26 Hazardous Materials ........... 20 2.27 Recordation ............... 21 2.28 2.29 Quiet Enjoyment 21 General Provisions ........... 21 ............. ............. cWpin/lnc.6 9-21-W -i- . EXHIBITS EXHIBIT A - LEGAL DESCRIPTION EXHIBIT B - SITE MAP EXHIBIT C - PHOTO OF SITE GROUND LEASE This GROUND LEASE (the "Lease") is dated as of p5"'p between SCHOOL DISTRICT ("Tenant" or "District"), who agree as follows: the CITY OF CARLSBAD ("Landlord" or olCity") d CARL BAD UNIFIED ARTICLE 1 FUNDAMENTAL INFORMATION 1.1 Landlord: CITY OF CARLSBAD, a general law city located in the County of San Diego ("County"), State of California (otState'') . 1.2 Tenant: CARLSBAD UNIFIED SCHOOL DISTRICT, a school district organized and existing under the laws of the State. 1.3 Commencement Date: The Commencement Date shall be the date set forth in the introductory paragraph, above. 1.4 Premise@: The property leased hereunder (the "Property") is that real property described in the Legal Description attached hereto as Kxhibit "A" and incorporated herein by this reference. components (the "Components"), depicted on the Site Map attached The premises consist of the following hereto as Exhibit "B": (a) Pine Elementarv School ("Elmentarv Scho monent, consisting of buildings and grounds used for elementary 01 " 1 school instruction and other support functions, and open space, covered walkways, 16,500 square feet occupied by relocatable including: 48,400 square feet occupied by permanent buildings and classrooms and 196,500 square feet occupied by a ball field, soccer field and other open space); (b) Carlsbad Villase Academv (NCV*tl) Comuonent;, consisting of buildings and grounds used as a continuation\alternative education facility for high school age students, occupying 27,600 square feet in a separate fenced area on the southwestern-most portion of the Property; and (c-) Maintenance and Operation Yard ("Maintenance Yard*) maintenance facility for the District, occupying 24,000 square Comuonenh, consisting of buildings and grounds which serve as the feet, completely enclosed with fencing. 1.5 m: As described in Section 2.3 (a) , below. cWpim/lrs*.6 9-21-99 -1- 1.6 Landlord's address for noticea: City of Carlsbad Community Services Department Carlsbad, California 92008-1989 1200 Carlsbad Village Drive Attention: Keith Beverly Fax: (760) 434-7185 With a copy to: City Attorney 1200 Carlsbad Village Drive Attention: Ronald R. Ball, City A Carlsbad, California 92008-1989 Fax: (760) 434-8367 1.7 mt's aaress for noticea: Carlsbad School District 801 Pine Avenue Attention: Superintendent Carlsbad, California 92008 Fax: (760) 729-8134 With a copy to: Bowie, Arneson, Wiles & Giannone 4920 Campus Drive Newport Beach, California 92660 Attention: Wendy H. Wiles Fax: (949) 851-1300 Ltorney 1.8 : As described in Sections 2.4, 2.5. and 2.20, below. 1.9 sueelfled ume of the prow&^ : For the Term of exclusively for the uses respectively set forth in Section 1.4 of this Lease, each Component of the Property shall be used this Lease, and for no other purpose. ARTICLE 2 LEASE TERMS AND PROVISIONS .. 2.1 -t to Lease (a) Landlord hereby leases the Property to Tenant, and Tenant hereby leases the Property from Landlord, subject to the provisions and conditions herein set forth. -2 - Lease, reference to the Property is to the land described in the (b) Except as expressly provided to the contrary in this attached Exhibit "An and any and all buildings, structures or other exception of those relocatable or portable structures, storage improvements either now or hereafter located on such land, with the expiration of the Term of this Lease ("District's Structures".), structures and other improvements to be removed by Tenant upon the Agreement as Exhibit "C," which is incorporated herein by this which are identified in the photo of the Property attached to this all buildings, structures and other improvements located on the reference. The parties agree that during the Term of this Lease. be owned in fee by Landlord. Property (except District's Structures and personal property) shall (c) Upon the close of escrow, conveying fee title in the Property from Tenant to Landlord and reconveying a leasehold deliver to Landlord all keys to buildings located on the Property, interest in the Property from Landlord to Tenant, Tenant shall with the exception of the District's Structures, as defined in Section 2.1 (b) . 2.2 AcceDtance of PtoDerty. Tenant acknowledges that Tenant has owned the Property and, concurrently with the conveyance to Tenant of the leasehold interest herein, is conveying fee title in the Property to Landlord. Therefore, Landlord makes no representations, express or implied, with respect to the legality, or for any other uses. Tenant shall conduct its own investigation fitness, or desirability of the Property for Tenant's intended use to its satisfaction with respect to zoning, local codes and regulations, and other matters affecting Tenant's ability to use and improve the Property for Tenant's intended use. The Property shall be leased in an. "as is" condition, with no warranty or liability, express or implied, on the part of Landlord as to the condition of any buildings on the Property, the soil (or water), conditions relating to the Property. its geology, the existence of known or unknown faults or any other commence on- the Commencement Date, and shall continue for the (a) The Lease term (the "Term") for all Components shall following respective periods of time after the Commencement Date, or to the date resulting from an earlier termination as hereinafter set forth: (1) Blementarv School comuoru& Lease shall expire a8 to the Elementary School Component on : The Term of this December 31, 1999, unless, on or before December 1, 1999, Tenant Elementary School Component to and including June 30, 2000 (the delivers to Landlord a written notice extending the Term as to the "Elementary School Optional Term"). Subject to Tenant's right, at any time, to terminate the Lease as to the Elementary School cWpin/l.u*.6 9-11-99 -3 - component upon thirty (30) days' written notice to Landlord, the Term shall then automatically expire on June 30, 2000 without any further notice from Landlord. There shall be no extensions beyond the Elementary School Optional Term. Tenant may not renew the Term of this Lease as to the Elementary School Component if, at the time such notice is given, or at the time of the commencement of the Elementary School Optional Term, an Event of Default has occurred in the payment of Rent (as defined below) or in any other material provision of this Lease, Landlord has given written notice of such Event of Default and such Event of Default remains uncured at the expiration of the period within which Tenant may cure such default waive or limit Landlord's right to terminate this Lease upon any as provided in this Lease. Nothing herein shall be construed to Event of Default by Tenant (including any default in addition to Tenant's exercise of its right to renew hereunder regardless of failure to pay Rent) as provided in this Lease, notwithstanding such other default. (2) PA m: The Term of this Lease shall expire as to the CVA Component on June 30, 2001. There shall be no extensions of the Term. (3) painwe Yard Cornone&: The Term of this Lease shall expire as to the Maintenance Yard Component on June 30, 2001. There shall be no extensions of the Term. (b) Terminatipn. Subject to Section 2.23, below, giving written notice of termination to Tenant, in the event of any Landlord may terminate this Lease as to any and all Components by Default under this Lease (as provided in Section 2.23 hereof) that is not cured within the applicable cure period. provisions of Section 2.22, Tenant shall upon the expiration or (1) Subject to the damage and reconstruction sooner termination of this Lease surrender the Property to Landlord in good and clean condition, ordinary wear and tear excepted, including any buildings, structures, improvements or additions then located on the Property. (2) Upon the termination of this Lease as to a Component, Tenant shall promptly remove from the Property, at Tenant's sole cost and expense, all District's Structures, as defined in Section 2.1 (b) , and personal property located on the Component, all District's Structures and personal property shall be applicable Component. In the case of the Elementary School removed by Tenant in any event not later than June 30. 2000. -4 - (3) Any District's Structures, as defined in Section 2.1 (b) , and .personal property not removed from the Property by Tenant as provided in subparagraph (c) (2) shall be removed by property of the Landlord. Tenant shall reimburse Landlord for all Landlord at the cost and expense of Tenant, or shall become the costs incurred by Landlord pursuant to this subparagraph (31, Obligations pursuant to this subparagraph (3) shall survive the including Landlord's reasonable administrative costs. Tenant's termination of this Lease. (4) Upon the termination of this Lease as to the Maintenance Yard Component, Tenant shall promptly remove from the expense, and in accordance with all applicable government Property and remediate, as applicable, at Tenant's sole cost and requirements, all hazardous materials or toxic substances related paint, oil, pesticides, etc.) . Any hazardous materials or toxic to or used in connection with the maintenance function (i-e., substances that are not removed from the Property and/or remediated by Tenant as provided in this subparagraph (c) (4) shall be removed and/or remediated by Landlord at the cost and expense of Tenant. Tenant shall reimburse Landlord for all costs incurred by Landlord pursuant to this subparagraph (4), including Landlord's reasonable administrative costs. Tenant's obligations pursuant to this subparagraph (4) shall survive the termination of this Lease. 2.4 Basic Rent. Subject to Section 2.20, Tenant shall pay to Landlord, as rent for the Property, the amount of One Dollar ($1.00) per year. 2.5 &ddi t im Rent that is due pursuant to this Lease, Tenant shall pay to . In addition to any Annual Basic Landlord, as additional consideration for the lease of the Property, any sums described in this Lease as "Additional Rent." 2.6 - (a) All Rent (including Basic, Additional and Holding Over) shall be paid absolutely net to Landlord, so that this Lease Term of this Lease. This Lease is and shall be a "Pure Net" or shall yield to Landlord the full amount of the Rent throughout the "Triple Netn lease, as such terms are commonly used in the real estate industry, it being intended that Tenant shall pay all costs, operation of the Property. expenses and charges arising out of the use, occupancy and (b) All payments of Rent and of other sum to be paid by Tenant to Landlord pursuant to this Lease shall be paid in lawful money of the United States of America, at Landlord's address set forth above, or at such other place within the United States or to such other person, firms or corporations as Landlord from time to provided by the terms of this Lease, Landlord and Tenant agree that time may designate in writing. Except as otherwise expressly cbd/plrr/Inr~.6 9-214 -5- . -. *. - all sums payable hereunder to or on behalf of Landlord shall be paid without.notice or demand. (c) Should Tenant fail, for whatever reason, to make any rental payment required hereunder, then Tenant shall pay an Additional Rent equal to 4% per annum on the amount due, until paid; provided, however, that nothing in this paragraph (c) shall be deemed to limit any of Landlord’s other rights or remedies under this Lease or otherwise available at law or in equity. 2.7 expense, undertake and complete any maintenance, repair, nt Wprlr. Tenant shall, at its own cost and Tenant during the Term hereof. In the conduct of such work, Tenant rehabilitation or reconstruction of the improvements undertaken by shall comply with any and all applicable City rules, regulations, or requirements. uses set forth in Section 1.4, above, and shall not use or permit (a) Tenant shall use the Property only for the specified cause, maintain, or permit any nuisance or waste in, on, or about the Property to be used for any other purposes. Tenant shall not the Property, normal wear and tear excepted. discrimination against any person, or group of persons, on account (b) Tenant covenants and agrees there shall be no of race, color, creed, religion, sex, sexual orientation, marital status, national origin or ancestry in the use, occupancy, tenure or enjoyment of the Property, nor shall Tenant itself or any person claiming under or through it establish or permit any such practice or practices of discrimination. 2.9 liance with Lu. Tenant shall not use the Property or permit anything to be done in or about the Property which will in any way conflict at that time with any applicable law, statute, ordinance, or governmental rule, regulation or promulgated. requirement now in force or which may hereafter be enacted or 2.10 - -. Tenant shall not make or on the Property or any building or structure thereon or any part suffer to be made any alterations, additions, or improvements to or thereof without the prior written consent of Landlord. .. Landlord, (a) keep and maintain any buildings on the Property in good condition and repair, ordinary wear and tear excepted, and keep and maintain the remaining portions of the Property in at ordinary wear and tear excepted; and (b) undertake such maintenance least the same condition it was in on the Commencement Date, 2.11 w. Tenant shall, without cost or expense to -6- of the Property from time to time as may be reasonable and customary under the circumstances. 2.12 m (a) Pavment bv shall promptly pay, at least five (5) days prior to delinquency, Tenant. To the extent applicable, Tenant all real estate and real property taxes, or possessory interest applicable, Tenant shall, during the term of this Lease, pay any tax, assessed against the Property. In addition, to the extent levy far the installation, maintenance or operations of local improvements affecting the Property as may be assessed by any governmental boards or bureaus having jurisdiction thereof. (b) Contest. Tenant shall have the right, by appropriate proceedings, to protest or contest in good faith any the validity of any taxes or of any change in assessment or tax assessment or re-assessment of taxes, any special assessment, or rate; provided, however, prior to any such challenge Tenant must either (a) pay the taxes alleged to be due in their entirety and seek a refund from the appropriate authority, or (b) poet bond in an amount sufficient to insure full payment of the taxes. (c) -ertv TaxeE. To the extent applicable, Tenant shall pay any and all personal property taxes assessed property located in, on, or about the Property. Tenant shall against equipment, trade fixtures, inventory, or other personal and against any such personal property taxes. indemnify, defend, and hold Landlord and the Property harmless from 2.12.1 Notice of Possessorv Interest (a) In accordance with California Revenue and Taxation Code Section 107.6(a), Landlord states that by entering into this Lease, a possessory interest subject to property taxes may be created. Tenant or other party in whom the possessory interest is vested may be subject to the payment of property taxes levied on such interest. (b) Without limiting the foregoing, in the event the Property and/or the improvements the.reon, or any possessory or assessments levied, assessed or imposed on such property, Tenant interest therein, should at any time be subject to ad valorem taxes entire property, and not merely upon the assessed value of its shall pay taxes and assessments upon the assessed value of the leasehold interest. cbdlpiWleau.6 9-21-W -7- . 2.13 prohibition Aaainst Transfers. (a) Tenant shall not, under any circumstances, without sublease Tenant's interest in the Property or any portion thereof, the express prior written approval of Landlord, transfer or or attempt to assign or transfer all or any portion of its interest Property or any portion thereof or interest therein, or assignment in this Lease. Any attempted transfer or subleasing of the of this Lease, which is not expressly approved in writing by Landlord shall be void and of no force or effect and, at the option of Landlord, shall terminate this Lease. (b) Prior to the expiration or earlier termination of not, under any circumstances, without the express prior written this Lease as to the Elementary School Component, Landlord shall or attempt to assign or transfer all or any portion of the approval of Tenant, transfer or lease any portion of the Property, Property, to another party. Any attempted transfer or leasing of the Property or any portion thereof or interest therein, or assignment of this Lease, which is not expressly approved in writing by Tenant shall be void and of no force or effect and, at this paragraph (b), Landlord shall have the right to continue to the option of Tenant, shall terminate this Lease. Notwithstanding operate existing programs on any portion of the Property as they currently are operated, or may institute additional programs after Property shall not interfere with Tenant's occupancy or quiet school hours and on week-ends; however, Landlord's use of the expiration or earlier termination of this Lease as to the enjoyment of the Components then leased by Tenant. Upon the Elementary School Component, Landlord shall have the right to lease or otherwise dispose of the remaining school buildings for any purpose and in such manner as Landlord may determine, in its sole discretion. 2.14 - (a) Tenant shall indemnify, defend, and hold Landlord harmless from and against any and all costs, claims, demands, actions, causes of action, liability, loss, or damage, including attorneys' fees and costs (collectively referred to as "Claiman and, Claims that are made by third parties, collectively referred to as "Third Party Claims") whether for injury to or death or persons or damage to real or personal property or otherwiee, arising out of or in connection with Tenant's use or occupancy of or suffered by Tenant in or about the Property, or arising from any the Property, any activity, work, or other thing done, permitted, of the Property by any party during the Term of this Lease, except reason or cause whatsoever in connection with the use or occupancy preceding sentence shall not apply with respect to any negligent or Landlord's uses under Section 2.13 (b) . The provisions of the intentional acts or omissions of Landlord and its agents, servants, contractors and employees (collectively, "Landlord Parties"), and -a- shall apply as to any Component only until Tenant vacates such Component. . Tenant shall further indemnify, defend, and hold Landlord harmless from and against any and all Third Party Claims arising from any breach or default in the performance of any obligation on Tenant's part to be perfozmed under the terms of this Lease or arising from any act or negligence of Tenant or any officer, agent, employee, guest, or invitee of Tenant. In any Landlord by reason of any such Claim, Tenant upon notice from case, action, or proceeding brought against Landlord or involving Landlord shall defend the same at Tenant's expense by counsel reasonably satisfactory to Landlord. Tenant, as a material part of eroperty or injury to persons in, upon, or about the Property from the consideration to Landlord, hereby assumes all risk of damage to of Landlord Parties, and Tenant hereby waives all claims in respect any cause other than the negligent or intentional acts or omissions this paragraph shall include attorneys' fees, investigation costs, thereof against Landlord. Tenant's obligation to indemnify under Landlord. If the ability of Tenant to use the Property is and other reasonable costs, expenses, and liabilities incurred by interrupted for any reason, Landlord shall not be liable to Tenant for any loss or damages occasioned by such loss of use unless caused by the negligent or intentional acts or omissions of Landlord Parties. (b) Landlord or its agents ehall not be liable for loss or damage to any property by theft or otherwise, nor for any injury to or damage to persons or property resulting from fire, explosion, falling plaster, steam, gas, electricity, water, or rain which may leak from any part of the Property while Tenant is leasing such part, or from the pipes, appliances, or plumbing works therein or resulting from dampness or any other cause whatsoever, unless from the roof, street, or subsurface or from any other place caused by or due to the negligent or intentional acts or omissions of Landlord Parties. Tenant shall give prompt notice to Landlord or in the fixtures or equipment. in case of fire or accidents in the Property or of defects therein (c) Landlord shall indemnify, defend, and hold Tenant harmless from and against any and all costs, claims, demands, actione, causes of action, liability, loss, or damage, including attorneys' €ees and costs (collectively referred to as "Claims" and, Claim that are made by third parties, collectively referred persons or damage to real or personal property or otherwiee, to as "Third Party Claims") whether for injury to or death or arising out of or in connection with Landlord's use or occupancy of preceding sentence shall not apply with respect to any negligent or the Property under Section 2.13 (b) . The provisions of the contractors and employees (collectively, "Tenant Parties"). intentional acts or omissions of Tenant and its agents, servante, Landlord shall further indemnify, defend, and hold Tenant harmless breach or default in' the performance of any obligation on from and against any and all Third Party Claim arising from any -9- Landlord's part to be performed under the terms of this Lease or arising from any act or negligence of Landlord or any officer, agent, employee, guest, or invitee of Landlord. In any case, action, or proceeding brought against Tenant or involving Tenant by reason of any such Claim, Landlord upon notice from Tenant shall defend the same at Landlord' s expense by counsel reasonably satisfactory to Tenant. Landlord, as a material part of the property or injury to persons in, upon, or about the Property consideration to Tenant, hereby assumes all risk of damage to arising out of or in connection with Landlord's use or occupancy of the Property under Section 2.13 (b) , from any cause other than the negligent or intentional acts or omissions of Tenant Parties, and Landlord hereby waives all claim in respect thereof against Tenant. Landlord's obligation to indemnify under this paragraph shall include attorneys' fees, investigation costs, and other the ability of Landlord to use the Property under Section 2.13(b) reasonable costs, expenses, and liabilities incurred by Tenant. If is interrupted for any reason, Tenant shall not be liable to unless caused by the negligent or intentional acts or omissions of Landlord for any loss or damages occasioned by such loss of use Tenant Parties. 2.15 QwnershiD of ProD- structures, fixtures, additions and improvements located on the (a) During the Term of this Lease, all buildings, Property (except District's Structures, as defined in Section Landlord. 2.1 (b) , and/or personal property) shall be owned in fee by (b) Upon the expiration or termination of this Lease, all buildings, structures, fixtures, additions, equipment, Property shall be surrendered with the Property, but not including improvements and any other real property whatsoever located on the personal property that is removed from the Property by Tenant. District's Structures, as defined in Section 2.l(b), and/or (C) Upon termination of this Lease, whether by expiration of the Term or otherwise, the improvements on the Property, and all personal property not removed by Tenant (including all District's Structures, as defined in Section Z.l(b), and/or other personal property), shall, without compensation to Tenant, then become Landlord's property, free and clear of all claim to or against them by Tenant or any third person, firm or entity, except if Landlord elects to cause such District's Structures and/or other personal property to be removed from the Property, at Tenant's sole cost and expense. ctai/plne/l.ue.6 9-21-W -10- 2.16 shall not create or permit any lien or encumbrance to be attached Liens. Except as otherwise provided herein, Tenant Tenant. Tenant shall indemnify and hold harmless Landlord and the to or affect the Property by reason of any act or omission of encumbrance, and against any costs in connection therewith, Property against any such lien, encumbrance, or claim of lien or including attorneys' fees. 2.17 Subroclation Neither Landlord nor Tenant shall be liable to the other or to any insurance company (by way of subrogation or otherwise) insuring the other party for any loss or damage to any building, structure, or other tangible property, or any resulting loss of income, or losses under worker's compensation laws and benefits (even though such party, its agents, or employees), to the extent any such loss such loss or damage might have been occasioned by the negligence of or damage is covered by insurance proceeds received by the party suffering the loss or damage. Landlord and Tenant hereby mutually release each other from liability and waive all right to recover against each other or against officers, employees, agents or representatives of each other for any loss or damage to any person proceeds paid against or under any insurance policies carried by or property caused by or resulting from risks to the extent of the parties; provided, however, this paragraph shall be inapplicable if it would have the effect, but only to the extent that if would have the effect, of invalidating any insurance coverage of Landlord or Tenant. The parties shall, to the extent provide a waiver of subrogation. available, cause each insurance policy obtained here under to 2.18 Ineurance (a) wtv Ins-. . Tenant shall procure and maintain in force at all timcs during the Term of this Lease at its cost a policy or policies of fire and extended coverage insurance Tenant, in an amount equal to one hundred percent (100%) of the (all risk of physical loss) covering those Components leased by full replacement cost (using materials of a like quality and kind as existed immediately prior to the damage or destruction) of the debris removal and demolition, building ordinance protection, and Property. This insurance shall include endorsements for inflation, plate glass coverage with respect to the Property. Landlord shall proceeds of any such policy or policies of insurance shall be held be named as an additional insured on the insurance, and the and utilized in accordance with the provisions of Section 2.22. of this Lease. (b) Wabilitv at all times during the Term hereof at its'cost commercial general . Tenant shall also procure and maintain liability insurance against any liability arising out of Tenant's use, occupancy, or maintenance of those Components leased by Tenant -11- and all areas appurtenant thereto, including without limitation personal inj.ury and death. Such insurance shall be in an amount not less than $5,000,000 per occurrence, combined single limit, increased every five (5) years by the percentage increase, if any, in the Consumer Price Index from the Commencement Date of this Lease. This policy shall include broad form contractual liability and indemnity coverage which shall insure performance by Tenant of the indemnity and defense provisions set forth in this Lease. The limits of said insurance shall not, however, be construed to limit the liability of Tenant under this Lease. (c) maintain at all times durinq the Term of this Lease at its cost (i) . Tenant shall procure and worker's compensation covergge, in the amount required by law, (ii) personal injury insurance with endorsement deleting the employee amount of $1,000,000 for each accident or occurrence, increased liability exclusion, and (iii) employer's liability coverage in the Consumer Price Index from the Commencement Date of this Lease. The every five (5) years by the percentage increase, if any, in the worker's compensation insurance and the employer's liability coverage shall cover any person or entity employed directly or indirectly by Tenant, any agent acting on behalf of Tenant, and anyone for whose acts Tenant may be liable. ~ "". ~~~ (d) Deduct-. The deductible amounts per claim or occurrence, if any, with respect to all insurance which Tenant is or occurrence, increased every five (5) years by the percentage required to maintain hereunder shall not exceed $20,000 per claim Date of this Lease. The amount of the deductibles, if any, within increase, if any, in the Consumer Price Index from the Commencement this limitation shall be a business decision by Tenant; under no circumstances shall Landlord be required to reimburse Tenant for the amount of any deductible incurred by Tenant in connection with any insured event, even if the event resulting in the claim wao caused or contributed to by Landlord or its agents, servants, or employees. (e) pccurrence BU. All insurance which Tenant is required to maintain hereunder shall be on an occurrence basis and rating of A--:V or better. shall be with insurance companies having a Best's Insurance Guide (f) Beauireme-. AB applicable, the insurance required pursuant to this Lease shall: (1) M~W Landlord and ita officers, employees, ,volunteers, contractors and agents as additional thereof is primary and non-contributory coverage with respect to insureds aa their interests appear; (2) provide that the coverage all additional insureds; (3) contain a Standard Cross Liability endorsement providing that the insurance applies separately to each insured against whom a claim is filed, and that the policy covers claims or suits by one insured against the other; (4) provide that the interests and protections of the additional insureds shall not eWpinll*u*.b 9-21-99 -12 - -. .- be affected by any misrepresentation, act or omission of a named policy which would otherwise result in forfeiture or reduction of insured or any breach by a named insured of any provision in the coverage; and (5) terminate as to each Component at such time as such Component is no longer leased by Tenant. (9) Certificates of Insur prior to the execution of this Lease, Tenant shall notify Landlord ancg. Within five (5) days in writing of the name of Tenant's insurer. Tenant shall deliver of insurance evidencing the existence and amount of such insurance, to Landlord prior to entry on the Property by Tenant certificate8 and showing Landlord (and the other parties designated in paragraph (f) , above) as an additional insured on all policies; provided that Landlord may (but shall not be required to) procure same at in the event Tenant fails to procure and maintain such insurance, reduction of coverage or other modification except after thirty Tenant's expense. No policy shall be cancelable or subject to (30) days prior written notice to Landlord by the insurer (or such shorter period of time for such notice as may be the commercial custom and practice in such policies). Tenant shall, within twenty Landlord with renewals or binders, or Landlord may order such (20) days prior to the expiration of such policies, furnish insurance and charge the cost to Tenant, which amount shall be payable by Tenant upon demand. All such policies shall be written as primary policies, not contributing with and not in excess of Tenant's employees as additional insureds. Tenant shall have the coverage which Landlord may carry, and all policies shall include policies obtained by Tenant provided that such blanket policies right to provide such insurance coverage pursuant to blanket expressly afford coverage to the Property and to Tenant and Landlord as required by this Lease. Tenant shall, upon request from Landlord, immediately deliver to Landlord copies of all with respect to Tenant's business and the Property. insurance policies (including the declarations pages) in effect .. 2.19 services and utilities to the Components leased by Tenant; Landlord Tenant shall make all arrangements for and pay for all shall not be responsible or liable to Tenant for interruption or due to the negligent and/or intentional acts or omissions of stoppages o€ utilities or other services to the Property, except Landlord. 2 .20 (a) &bmuu-v School. the Term as' to the Elementary School Component as provided in (1) Bxcept in the event Tenant has extended vacate the Elementary School Component at the end of the Term Section 2.3(a)(1) of this Lease, in the event Tenant fails to -13- (i.e., December 31, 19991, Tenant shall be liable for and shall pay to Landlord .upon demand: (a) a rental for the Elementary School component in the amount of Four Thousand Fifty-Six Dollars and Holding Over Rent"), retroactive to the Commencement Date and Twenty-Five Cents ($4,056.25) per month (the "Elementary School continuing every month until Tenant vacates the Elementary School Component, up to June 30, 2000 (after which, the Holding Over Rent amount set forth in paragraph (31, below, shall apply), which is baaed on a rent of $0.75 per square foot times 64,900 square feet (i.e., 48,400 square feet of the Elementary School Component which is occupied by permanent buildings and covered walkways, and 16,500 square feet of the Elementary School Component which is occupied by relocatable classrooms), for an annual rent of $48,675 per year; and (b) all damages incurred by Landlord by reason of the inability to deliver possession of the Property or any portion thereof to any other person. (2) Notwithstanding the expiration or earlier Component and notwithstanding any other provision of this Lease, so termination of the Term of this Lease as to the Elementary School School Component, Tenant shall continue to be obligated to pay the long as any leased portable structure remains on the Elementary full amount of the Elementary School Basic Rent to Landlord. Term of the Lease as to the Elementary School Component and Tenant (3) In the event Tenant elects to extend the fails to vacate the Elementary School Component at the end of the Elementary School Optional Term (i.e., June 30, 2000). the Elementary School Component Holding Over Rent shall be the amount Cents ($4,664.69) per month (the *Elementary School Extended Term of Four Thousand Six Hundred and Sixty-Four Dollars and Sixty-Nine Holding Over Rent"), commencing July 1, 2000 and continuing every month until Tenant vacates the Elementary School Component, which is based on a rent of $0.8625 per square foot times 64,900 square feet, for an annual rent of $55,976.25 per year, which shall be increased by fifteen percent (15%) per year thereafter until Tenant vacates the Elementary School Component. (b) PA Comoa. In the event Tenant fails to vacate the CVA Component at the end of the Term (i.e., June 30, demand: (i) a rental for the CVA Component in the amount of One ZOOl), Tenant shall be liable for and shall pay to Landlord upon Thousand Seven Hundred Twenty-Five Dollars ($1,725.00) per month (the "CVA Holding Over Rent"), retroactive to the Comencement Date and continuing every month until Tenant vacates the CVA Component, which is based on a rent of $0 -75 per square foot times 27,600 square feet for an annual rent of $20,700 per year, which shall be vacates the CVA Component; and (ii) all damages incurred by increased by fifteen percent (152.) per year thereafter until Tenant - 14- Landlord by reason of the inability to deliver possession of the property or any portion thereof to any other person. (C) Maintaxiwe Yard Commnent Tenant fails to vacate the Maintenance Yard Comnent at the end of . In the event ~~~~~ ~ the Term (i.e., June 30, 2001), Tenant shall- be liable for and Yard Component in the amount of One Thousand Five Hundred Dollars shall pay to Landlord upon demand: (i) a rental for the Maintenance ($1,500.00) per month (the “Maintenance Yard Holding Over Rent”), until Tenant vacates the Maintenance Yard Component, which is based retroactive to the Commencement Date and continuing every month on a rent of $0.75 per square foot times 24,000 square feet for an annual rent of $18,000 per year, which shall be increased by Maintenance Yard Component; and (ii) all damages incurred by fifteen percent (15%) per year thereafter until Tenant vacates the Landlord by reason of the inability to deliver possession of the Property or any portion thereof to any other person. 2.21 Fntrv bv Landlord Property on which Landlord operates programs as provided in Section In addition to Landlord’s right to enter those portions of the 2.13 (a) (2) of this Lease, Landlord reserves and shall at any and all times have the right, but not the obligation, to enter the Property, for the following purposes: (a) to respond to any emergency situation; (b) to inspect the Property, provided such inspections shall take place during normal business hours and upon necessary by Landlord to respond to any emergency situation, which not less than 24 hours’ notice, except for inspections deemed inspections may occur at any time, and for which no advance notice shall be required; (c) to post notices of non-responsibility; and so, subject to notice to Tenant, and a reasonable opportunity to (d) to make repairs to the Property, without any obligation to do cure, as provided in Section 2.23 (b) hereof, except for repairs deemed necessary by Landlord to respond to any emergency situation, for which no notice or opportunity to cure shall be required. provided, however, that Landlord shall take all reasonable steps to ensure that Tenant‘s operations shall not be interfered with unreasonably. Landlord agrees to defend and hold Tenant harmletla for any and all claime, liability and damages arising out of any by the negligence or willful misconduct of Tenant. Except a0 activity by &andlord on the Property, except to the extent caused provided in the previous sentence, Tenant hereby waives any claim for damages for any injury or inconvenience to or interference with Tenant, any loss of occupancy or quiet enjoyment of the Property, and any other loss which may occur pursuant to Landlord’s entry under this section 2.21. Landlord shall have the right to use any and all means which Landlord may deem proper to open doors in an emergency in order to obtain entry to the Property, without liability to Tenant except for any failure to exercise due care for Tenant’s property. Any entry to the Property obtained by Landlord by any means for the purposes specified above shall not under any cWpiru/luu.6 9-21-99 -15- circumstances be construed or deemed to be forcible or unlawful entry into, or a detainer of, the Property or an eviction of Tenant from the Property or any portion thereof. 2.22 Damase. Reconstructioq (a) Covered bv damaged by fire or other perils covered by extended coverage Insurance. In the event the Property is insurance, Tenant shall have the right to use all available Property. If the estimated cost of repairs (including lost rent) insurance proceeds to repair or rebuild the improvements on the loss insurance proceeds), then Tenant shall forthwith repair the is not in excess of available insurance proceeds (including rent same (using the insurance proceeds to pay the cost of such repair) and this Lease shall remain in full force and effect. (b) -* (i) In the event the Property is damaged as a extended coverage insurance, or the estimated cost of repairs result of any cause other than the perils covered by fire and (including rent loss insurance proceeds), then Tenant shall notify (including lost rent) is in excess of available insurance proceeds Landlord in writing of the amount by which the estimated cost of repairs exceeds such proceeds (the "Shortfall"), and Tenant shall have the right, within ninety (90) days after receipt of such notice, to elect to provide the Shortfall and proceed with such Tenant may provide to pay the Shortfall), in which case this Lease repairs (using the insurance proceeds. and such other funds as shall continue in full force and effect. ninety :(SO) .day period that it will provide the Shortfall and (ii) If Tenant fails to notify Landlord within such conduct the repairs, then Landlord shall have the option, within thirty (30) days from the end of the ninety (90) day period described in clause (i), either to (A) provide the Shortfall at damage (using the insurance proceeds and such additional funds as Landlord's sole expense and direct Tenant to repair or restore such Landlord may provide to pay the Shortfall), with this Lease continuing in full force and effect, or (B) give notice to Tenant which date shall be no less than thirty (30) and no more than sixty terminating -this Lease as of the date specified in such notice, (60) days after the giving of such notice of termination. In the event of giving ouch notice of termination, this Lease shall expire and all interest of Tenant in the Property shall terminate on the date so specified in such notice. (c) SDecial Termination Rim. Notwithstanding anvthina to the contrary contained in this Section, Tenant shall have no obligation whatsoever to repa'ir, reconstruct, or restore the Property, and Landlord shall have no right to instruct Tenant to do so, in either of the following circumstances: (i) the damage . -~~- -16- occurs during the last six (6) months of the Term of this Lease, or (ii) the damage cannot reasonably be expected to be repaired within six (6) months. In that event, Tenant may at its option terminate elects not to repair, reconstruct, or restore the Property. this Lease upon (30) days written notice to Landlord that Tenant (d) Excess Insurance .Proceeds. If completion of required repair, reconstruction or restoration of the, Property does unused proceeds. If, for any reason, Tenant does not repair, not utilize all insurance proceeds, then Tenant may retain such reconstruct or restore the Property, except if authorized by Landlord, or pursuant to subsection (c), above, the insurance proceeds shall belong to Landlord as its property. damages from Landlord for loss of the use of the whole or any part (e) Tenant shall not be entitled to any compensation or of the Property, Tenant's personal property, or any inconvenience or annoyance occasioned by such damage, repair, reconstruction, or restoration, except as is due to Landlord's negligent and/or intentional acts or omissions. Tenant waives the provisions of California Civil Code sections 1932(2) and 1933(4) with respect to any destruction of the Property. 2.23 Default (a) Subject to the notice and cure provieions of this perform any covenants, conditions, or provisions of this Lease to Section 2.23(d) and 2.23(e), failure by either Party to observe or be observed or performed by such Party shall constitute a deLault and breach of this Lease. The defaulting Party must immediately commence to cure, correct or remedy any such failure or delay and shall complete such cure, correction or remedy with reasonable diligence. of default to the Party in default, specifying the default (b) The non-defaulting Party shall give written notice complained of by the non-defaulting Party. Failure or delay in giving such notice shall not constitute a waiver of any default, nor shall it change the time of default. Except as otherwise party in asserting any of its rights and remedies as to any default expressly provided in this Lease, any failures or delays by either or remedies. Delays by either party in asserting any of its rights shall not operate as a waiver of any default or of any such rights and remedies shall not deprive either party of its right to necessary to protect, assert or enforce any such rights or institute and maintain any actions or proceedings which it may deem remedies. -17- (c) If a monetary event of default occurs, prior to exercising any remedies hereunder, Landlord shall give Tenant written notice of such default. Tenant shall have a period of received within which to cure the default prior to exercise of seven (7) calendar days after such notice is received or deemed remedies by Landlord. Notwithstanding any provision of this Lease, Landlord shall not be required to deliver written notice to Tenant as a condition to Tenant's obligations to pay any rent hereunder. If any payment is not received by Landlord within seven (7) calendar days following the due date thereof, then in addition to the remedies conferred upon Landlord pursuant to this Lease, a late added to the delinquent amount to compensate Landlord for the charge of ten percent (10%) of the amount due and unpaid will be which the amunt was due and payable until paid. expense of handling the delinquency, computed from the date on (d) If a non-monetary event of default occurs, prior to exercising any remedies hereunder, the non-defaulting Party shall give the party in default notice of such default. If the default is reasonably capable of being cured within thirty (30) calendar days after such notice is received or deemed received, the Party in default shall have such period to effect a cure prior to exercise of remedies by the non-defaulting Party. If the default is such that it is not reasonably capable of being cured within thirty (30) within said period, and (ii) diligently, continually, and in good days, and the Party in default (i) initiates corrective action faith works to effect a cure as soon as possible, then the Party in default shall have such additional time as is reasonably necessary defaulting Party. In no event shall Landlord be precluded from to cure the default prior to exercise of any remedies by the non- exercising remedies if the security of its fee interest in the Property becomes or is about to become materially jeopardized by any failure to cure a default. In no event shall either non- defaulting Party be precluded from exercising remedies if the default is not cured within ninety (90) days after the first notice of default is given. (e) Any notice of default that is transmitted by electronic facsimile transmission followed by delivery of a *hard" copy, shall be deemed delivered upon its transmission, provided if such facsimi-le is received on a nonbusiness day or after 5:OO p.m. next business day; any notice of default that is personally on a business day, receipt shall be deemed to have occurred on the delivered (including by means of professional messenger service, courier service such as United Parcel Senrice or Federal Express, or by U.S. Postal Service), shall be deemed received on the documented date of receipt by Tenant; and any notice of default return receipt required shall be deemed received on the date of that is sent by registered or certified mail, postage prepaid, receipt thereof. -18- within the respective period of time provided in paragraphs (c) and (f) If any default or breach is not cured by Tenant exercise any and all rights or remedies which may be available at (d) of this Section 2.23, then Landlord shall be entitled to law or in equity, including terminating this Lease. Any and all not alternative. rights or remedies available to Landlord shall be cumulative, and (g) In any case where, after notice of default is given to Tenant pursuant to this Section 2.23 and Tenant has not cured such default within the respective times provided for such cure in this Lease, then Landlord shall have the following rights and remedies : damages against Tenant; (i) Landlord shall have the right to seek money injunctive relief and/or specific performance of (ii) Landlord shall have the right to seek any obligation of Tenant hereunder; (iii) Landlord shall have the right to cure the default, in which case, Tenant shall reimburse all costs and expenses incurred by Landlord in connection therewith, immediately upon demand, plus annum. interest at the rate of ten percent (10%) per (iv) Landlord shall have the right to terminate this Lease. 2.24 t Domain. If the Property or any portion thereof is taken under the power of eminent domain, or sold by Landlord under the threat of the exercise of such power, this Lease shall terminate as of the date that the condemning authority takes possession of the Property. Tenant hereby waives any claim to any and all awards for the taking of any part of the Property or power of eminent domain. proceeds from the eale made under the threat of the exercise of the 2.25 - el Offset Stat- not less than twenty (20) days' prior written notice from Landlord, (a) Tenant shall, at 'any time and from time to time upon execute, acknowledge, and deliver to Landlord a statement in writing certifying that this Lease is unmodified and in full force and effect (or, if modified, is in full force and effect, and stating the modifications) and acknowledging that there are not, to Tenant's knowledge, any uncured defaults on the part of Landlord hereunder (or specifying such defaults if any are claimed) and such other matters as may be reasonable and customary or as needed to clarify any provision of this Lease. -19- (b) Landlord shall, at any time and from time to time upon not less than twenty (20) days' prior written notice from Tenant, execute, acknowledge, and deliver to Tenant a statement in writing certifying that this Lease is unmodified and in full force and effect (or, if modified, is in full force and effect, and Landlord's knowledge, any uncured defaults on the part of Tenant stating the modifications) and acknowledging that there are not, to hereunder (or specifying such defaults if any are claimed), the last date Landlord received rent under this Lease, the date such rent was due and the amount thereof, acknowledging that the recipient will rely on the certificate, and such other matters as may be reasonable and customary or as needed to clarify any provision of this Lease. 2.26 ous Mate- (a) Except to the extent it is normal and customary to do so during the construction or operation of educational property, Tenant shall not: Property, or any portion thereof, which emits, or permits (i) Make, or permit to be made, any use of the odors into the atmosphere, the ground, or any body of the emission of dust, sweepings, dirt, cinders, fumes, or water, whether natural or artificial, in violation of applicable law; discharged, leaked, or emitted, any liquid, solid, or (ii) Diecharge, leak, or emit, or permit to be gaseous matter, or any combination thereof, into the atmosphere, the ground, or any body of water, in violation of applicable law; or (iii) Use, store or dispose of on the Property any solid, liquid, or gaseous matter, or any combination thereof, which is, or may become, hazardous, toxic, or materials listed in Sections 66660 through 66685 of Title radioactive including, but not limited to, those 22 of the California Administrative Code, Division 4, Chapter 30 (as may be amended from time to time), in violation of applicable law (all of the foregoing Materials") . collectively referred to herein as "Hazardous (b) Tenant shall not keep any trash, garbage, waste, or other refuse on the Property except in sanitary containers and shall regularly and frequently .remove the same from the Property. Tenant shall keep all incinerators, containers, and other equipment used for the storage or disposal of such matter in a clean and 8anitar.y condition. Tenant shall surrender the Property at the Materials or contamination caused by Tenant's activities, and free expiration or termination of thie Lease free of any Hazardous -20- and clear of all judgements, liens, or encumbrances and shall, at its own cost.and expense, repair all damage and clean up or perform or Contamination caused by Tenant’s activities. Tenant shall, at any remedial action necessary relating to any Hazardous Materials its sole cost and expense remediate in accordance with law and/or may contain Hazardous Materials caused by Tenant’s activities. remove any alterations or improvements that may be contaminated or (c) Tenant shall indemnify, defend, and hold Landlord harmless from and against (i) any and all claims, demands, judgments, damages, actions, causes of action, injuries, administrative orders, consent agreements and orders, liabilities, penalties, costs, and expenses of any kind whatsoever (collectively collectively referred to as “Third Party Claims1‘) (including but referred to as “Claims” and, Claims that are made by third parties, not limited to Third Party Claims arising out of loss of life, resources) in connection with or arising out of any spills or injury to persons, property, or business, or damage to natural discharges of Hazardous Materials in violation of applicable law, to the extent caused by the activities of Tenant or its contractors, or any of them, that occur during the Term of this Lease, and (ii) from all claims, demands, judgments, damages, agreements and orders, liabilities, penalties, costs, and expenses actions,. causes of action, injuries, administrative orders, consent out of Tenant’s failure to provide all information, make all of any kind whatsoever, including but not limited to claims arising Hazardous Materials laws or any other environmental law during the submissions, and take all steps required by any authority under any Term of this Lease. Notwithstanding the expiration or termination of this Lease, Tenant’s obligations and liabilities under this Section shall continue so long as Landlord continues to own the Property or any portion thereof or otherwise remains responsible for any Hazardous Materials on the Property. Provided, however, have the effect of relieving any party of liability under any that nothing contained in this provision is intended to or shall applicable statutory or common law. 2.27 Becordation this Lease, the City shall cause this Lease to be recorded in the . Promptly upon the due execution of office of the recorder of San Diego County. 2.28 Quiet Eniovment;. Absent an uncured default by Tenant, Landlord agrees not to disturb the possession, interest or quiet enjoyment of Tenant .in the Property for any reason. 2.29 General Provisipna covenant, or condition herein contained shall not be a waiver of (a) Waive=. The waiver by either party of any tern, such term, covenant, or condition on any subsequent breach. cbwVplm/1~.0.6 9-21-99 -21- -.. (b) Notice@. All notices and demands which may or are other hereunder shall be in writing. Except as provided in Section to be required or permitted to be given by either party to the 2.23 (e), all notices and demands shall be sent by United States Mail, postage prepaid, to the address for each party set forth in Article 1 of this agreement. All notices shall be deemed to be manner required by this Section. served upon personal delivery or two (2) days after mailing in the (c) Time is of the Essence this Lease and each and all of its provisions in which performance . Time is of the essence of is a factor. (d) Bindina on Successors and Assians, and conditions herein contained, subject to the provisions as to The covenants assignment, apply to and bind the heirs, successors, executors, administrators, and assigns of the parties hereto. (e) Force Maleurg. In addition to specific provisions deemed to be in default where delays or defaults are due to war, of this Leaee, performance by either party hereunder shall not be insurrection, floods, earthquakes, fires, casualties, Acts of God, priority, unusually severe weather, inability to secure necessary epidemics, quarantine restrictions, governmental restrictions or labor, materials or tools, acts of the other party, acts or failure to act of any other public or governmental agency or entity or any other causes beyond the contro1,or without the fault of the party any such cause shall be for the period of the enforced delay and claiming an extension of time to perform. An extension of time for shall commence to run from the time of the commencement of the cause, if notice by the party claiming such extension is sent to the other party within thirty (30) days of knowledge of the commencement of the cause. (f) Severability. Any provision of this Leaee which shall prove to be invalid, void, or illegal shall in no way affect, impair, or invalidate any other provision hereof and such other provisions shall remain in full force and effect. (g) No Exclusive -. No remedy or election hereunder shall be deemed exclusive but shall, wherever possible, be cumulative with all other remedies at law or in equity. (h) of Califoa. This Lease shall be governed by shall be in San Diego, California. the laws of the State of California. Proper venue for any action -22- (i) No shall be deemed or construed as creating a partnership, joint Partnership. Nothing contained in this Lease venture, or any other relationship between the parties hereto other than Landlord and Tenant according to the provisions contained herein, or cause Landlord to be responsible in any way for the debts or obligations of Tenant, or any other party. (j ) Aareem-. This Lease, including any document or instrument incorporated therein or herein by reference, contains a complete and final expression of the agreement between Landlord and Tenant, and there are no promises, representations, agreements, warranties, or inducements either express or implied other than as are set forth in this Lease. Any and all previous discussions or agreements between Landlord and Tenant with respect to the premises, whether oral or written, are superseded by this Lease. when used in this Lease, the masculine sender shall be deemed to (k) wae of Lease. When the context so requires include the feminine and neuter gender alid the neuter gender shall be deemed to include the masculine and feminine gender. When the context so requires when used in this Lease, the singular shall be deemed to include the plural. The paragraph and section headings have been used for convenience only, and shall not be used in the but not limited to." interpretation hereof. The term "including" shall mean "including "" ~~~ rights of redemption granted by or under any present or future laws (1) n. Tenant hereby expressly waives any and all in the event of Tenant being lawfully evicted or dispossessed for any cause, or in the event of Landlord obtaining possession of the Property by reason of the violation by Tenant of any of the covenants and conditions of this Lease or otherwise. (m) Reauirement of a Writb. No amendment, change, or addition to, or waiver of termination of, this Lease or any part hereof shall be valid unless in writing and signed by both Landlord and Tenant. (n) No Third PartvBenpficiariea. The parties acknowledge and agree that the provisions of this Lease are for the sole benefit of Landlord and Tenant, and not for the benefit, directly or indirectly, of any other person or entity, except as otherwise expressly provided herein. (0) Byt;horitv of partiea. The person executing this bind such Party to perform pursuant to the terms and conditions of Lease on behalf of each Party has full authority to do so and to this Lease. (PI Incornoration by Referen attached hereto is incorporated herein by this reference. ce. Each of the exhibits cbnd/plw/loese.6 9-21-99 -23- (q) Jnteruretatioq ann's 1ength.and between persons sophisticated and knowledgeable in . This Lease has been negotiated at been given the. opportunity to consult with experienced and the matters dealt with in this Lease. In addition, each party has knowledgeable legal counsel. Accordingly, any rule of law (including Civil Code section 1654) or legal decision that would party that has drafted it ie not applicable and is waived. The require interpretation of any ambiguities in this Lease against the provisions of this Lease shall be interpreted in a reasonable manner to effect the purpose and intent of the parties to this Lease. (r) countem. This Lease may be executed by each party on a separate signature page, and when the executed signature pages are combined, shall constitute one single instrument. the date first set forth above. CAIUlSBAD UNIFIED SC€IOOL DISTRICT In witness whereof, the parties have executed this Lease as of By: -Steve Cade, President Attest: By : Clerk of the Boa& of Trustees CITY By: Attest: By: lerk -24- pers~lally known to me Oprovedtomeonthebasisofsatisfactory evidence to be the persOll(awh0se name~ls/.rs subscribed to the within instrument and the same In hidhe" authorized adcnow(edged to me that he&hdhy executed capacity2 and that by hislbdhir signature on the Instrument the -:or the entity upon behetl of which the pemn@if acted, executed the instrument. WITNESS my hand and ofiidf~l seal. Deaalptlon &Attach Wpacyr(iw) Chimed by Signor 0 Individual Signer's Name: Signer Is Representing: U CALIFORNIA ALLPURPOSE ACKNOWLEWMENT state of Callfomb personally appeared &msonally known to me 0 pmved to me on the basis of satisfadory evldence to be the pedde namd- subscribed to the within instrument and acknowledged to me thatbe/she#ksl executed the same in biefherlthd authorized capadtyyeS): and that by hiarherhbd the entity upon behalf of which the personM signaturewon the instrument the persow or .,., . . acted, executed the instrument. WITNESS my hand and offidal ssal. ^. - STATE OF CALIFORNIA COUNTY OF SAN DIEGO ) On #$3/9ss before JhJi+h 6. @unn:F appearedu (Zlnreuce%S&%%.bcr , personally 'known to , personally the within executed the ) 88. WITNESS my hand and official seal. Signature - Exhibit “A“ -. LEGAL DESCRIPTION [To be inserted behind this page prior to Recording] Exhibit "B" -_ SITE MAP [Behind this page] i