EXHIBIT 10.1
TABLE OF CONTENTS
1. Fundamental Lease Providers ..................................... 1
2. Premises ........................................................ 1
3. Term ............................................................ 2
4. Base Rent ....................................................... 3
5. Percentage Rent ................................................. 3
6. Condition of Improvements ....................................... 6
7. Parking and Common Areas ........................................ 6
8. Operating Costs and Taxes ....................................... 6
9. Security Deposit ................................................ 9
10. Use ............................................................. 9
11. Compliance With Law ............................................. 11
12. Alterations and Additions ....................................... 12
13. Repairs ......................................................... 12
14. Liens ........................................................... 13
15. Assignment and Subletting ....................................... 13
16. Hold Harmless ................................................... 16
17. Insurance ....................................................... 16
18. Utilities ....................................................... 17
19. Personal Property Taxes ......................................... 17
20. Competitive Business ............................................ 17
21. Holding Over .................................................... 18
22. Entry By Landlord ............................................... 18
23. Tenant's Default ................................................ 18
24. Default By Landlord ............................................. 22
25. Reconstruction .................................................. 22
26. Eminent Domain .................................................. 25
27. Signs ........................................................... 25
28. Displays ........................................................ 25
29. Auctions ........................................................ 25
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30. Surrender of Premises ........................................... 26
31. Relocation ...................................................... 26
32. Sale of Premises By Landlord; Exculpation ....................... 27
33. Subordination ................................................... 27
34. Tenant's Offset Statements ...................................... 28
35. Authority of Tenant ............................................. 28
36. Brokers ......................................................... 28
37. Merchant's Association .......................................... 28
38. General Provisions .............................................. 29
Exhibit "A" Site Plan
Exhibit "B" Legal Description of Shopping Center
Exhibit "C" Construction Exhibit
Exhibit "D" Confirmation of Commencement Date
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This Lease, dated as of this 24 day of April, 1995, is made by and between
▇▇▇▇▇▇ ▇ ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇ (herein called "Landlord") and FIRST NATIONAL
BANK OF ▇▇▇▇ CITY (herein called "Tenant")
1. FUNDAMENTAL LEASE PROVISIONS
(a) Trade Name - DBA: FIRST NATIONAL BANK OF ▇▇▇▇ CITY
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(b) Guarantor: CORP OFFICERS: ▇.▇. ▇▇▇▇▇, PRES. & ▇.
▇▇▇▇▇▇▇ ▇▇▇▇, VICE PRES.
(c) Use of Premises: BANKING
(d) Term of Lease: 60 MONTHS + TWO 5-YEAR OPTIONS
(e) Commencement JANUARY 1, 1995
(f) Expiration: DECEMBER 31, 1999
(g) Size of Premises: Approximately 3,000 SQUARE FEET
(h) Base Rent:
Period Amount
------ ------
A. 01-01-95 ▇▇ ▇▇-▇▇-▇▇ $3,400.00
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B. 01-01-96 ▇▇ ▇▇-▇▇-▇▇ $3,500.00
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C. 01-01-97 ▇▇ ▇▇-▇▇-▇▇ $3,600.00
---------------
D. 01-01-98 ▇▇ ▇▇-▇▇-▇▇ $3,700.00
---------------
E. 01-01-99 ▇▇ ▇▇-▇▇-▇▇ $3,800.00
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(i) Percentage Rent: none percent (0%) of Gross Sales (less Base Rent)
(j) Security Deposit none
(k) Merchant's Association or Marketing Fund: $25.00 per month
(l) Radius Restriction: -0-
(m) Notices to Tenant: ▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇, ▇▇▇▇▇
2. PREMISES
(a) Landlord does hereby lease to Tenant and Tenant hereby leases from
Landlord that certain space (herein called "Premises"), containing
approximately the area set forth in Section 1(g) of this Lease. The
location and dimensions of said Premises are delineated and
cross-batched on the site plan attached hereto as Exhibit "A". Said
Premises are located in the City of Pacifica, County of San Mateo,
State of California, and are part of
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the Shopping Center (the "Shopping Center") commonly known as Eureka
Square Shopping Center, at the northeast corner of Oceana Boulevard
and Eureka Drive in Pacifica, California, as legally described in
Exhibit "B." Copies of the aforesaid Exhibits "A" and "B" are
attached hereto, incorporated herein, and by this reference made a
part of this Lease. Landlord makes no representation or warranties
of any kind or nature as to the size, location, or time of
construction of any of the structures (other than the Premises)
shown on Exhibit "A". It is understood and agreed upon that the
depiction of the Shopping Center, and the location of the Premises
in the Shopping Center as shown on Exhibit "A" hereof, are subject
to change. Any such change shall not invalidate this Lease, and the
depiction and location of the Premises shall be deemed to have been
expressly modified and amended herein in accordance with such
changes.
(b) Landlord hereby reserves the right at any time, and from lime to
time to make alterations or additions to the Premises, to build
additional stores on the building in which the Premises are
contained, and to build adjoining the same, and to install,
maintain, use, repair and replace, pipes, ducts, conduits and wires,
leading through, under and over the Premises, in locations serving
other parts of the Shopping Center, from time to time, to make
alterations thereof or additions thereto, to build additional stores
on any such building or buildings, to build adjoining same, and to
construct doubledeck, subterranean or elevated parking facilities.
3. TERM
(a) The term of this Lease shall be for a period specified in Section
1(d) hereof, commencing on the date (herein referred to as the
"Commencement Date") specified in Section l(e) constructed or
unfinished improvements, the date of the occurrence of either of the
following events, whichever shall first occur:
(1) Thirty (30) days after the date Landlord notified Tenant in
writing that the Premises are ready for occupancy or should
have been ready for occupancy as provided in Section 3(e)
hereof. The Premises shall be deemed ready for occupancy when
all work of construction or improvement required hereunder on
the part of Landlord in connection therewith, if any, has been
substantially complete, and the Premises are in such condition
as to permit Tenant to enter thereon for the purpose of
installing therein Tenant's trade fixtures and equipment; or
(2) Upon the date Tenant actually commences to do business in,
upon or from the Premises.
(b) If the Commencement Date is other than the first day of a calendar
month, said Lease term shall be computed from the first day of the
calendar month next succeeding the Commencement Date.
(c) When the Commencement Date is not specified in Section 1(e) hereof,
and, as a consequence, has been determined as hereinabove set forth,
the parties shall execute a written memorandum in the form attached
hereto as Exhibit "D" expressly confirming said Commencement Date
and the expiration date of the term, and such memorandum shall
thereupon be deemed attached hereto incorporated herein, and by this
reference made a part of this Lease.
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(d) The work required to be performed by Landlord under the terms and
provisions of this Lease in order to make the Premises ready for
occupancy, if any, depends in whole or in part upon work to be
performed in connection therewith by ▇▇▇▇▇▇. Then, in such event,
the Premises shall be "ready for occupancy" on the date they would
have been ready for occupancy a Tenant had performed the work
required of Tenant in a diligent and timely manner and in accordance
with the schedule for the performance of such work established by
▇▇▇▇▇▇▇▇'s architect. The determination by ▇▇▇▇▇▇▇▇'s architect as
to the date the Premises are "ready for occupancy" taking into
consideration delays, if any, caused by Tenant, as aforesaid, shall
be conclusive upon the parties hereto.
(e) Notwithstanding the Commencement Date, if for any reason Lessor
cannot deliver possession of the Premises to Leasee on said date,
Lessor shall not be subject to any liability therefor, nor shall
such failure affect the validity of this Lease or the obligations of
Lessee hereunder or extend the term hereof, but in such case, Lessee
shall not be obligated to pay rent until possession of the Premises
is tendered to Lessee; provided, however, that it Lessor shall not
have delivered possession of the Premises within one-hundred eighty
(180) days from said Commencement Date, Lessee may, at Lessee's
option, by notice in writing to Lessor within ten (10) days
thereafter, cancel this Lease, in which event the parties shall be
discharged from all obligations hereunder; provided, further,
however, that if such written notice of Lessee is not received by
Lessor within said ten (10) day period, ▇▇▇▇▇▇'s right to cancel
this Lease hereunder shall terminate and be of no further force and
effect. If for any reason whatsoever, the term of this Lease shall
not have commenced on or before two (2) years after the date hereof,
this Lease shall thereupon be and become entirely canceled, and of
no further force and effect
4. BASE RENT
(a) Base Rent Subject to increases as set forth in Section 4(b), ▇▇▇▇▇▇
agrees to pay the Landlord as rent for Tenant's use of the Premises
and Tenant's rights hereunder ("Base Rent"), without notice or
demand, the sum set forth in Section 1(h) hereof, which Base Rent
shall be paid, in advance, on or before the first day of each and
every successive calendar month during the term hereof, except that
the first month's rent shall be paid upon the execution hereof. Rent
for any period which is for less than one (1) month shall be a
prorated portion of the monthly installment herein based upon a
thirty (30) day month Said rental shall be paid to Landlord, without
deduction or offset, in lawful money of the United States of America
and at such place as Landlord may from time to time designate in
writing.
(b) Periodic Rent Increase The Base Rent payable hereunder by Tenant to
Landlord shall be increased during the term hereof in increments as
set forth in Section 1(h) hereof. No delay or failure by Landlord to
enforce this provision or any part thereof as to Tenant, or to
enforce similar or dissimilar provisions in other leases in use as
to any other tenants in the Shopping Center, shall be deemed to be a
waiver hereof, or prevent any subsequent or other enforcement
hereof.
5. PERCENTAGE RENT
(a) Percentage Rent
In addition to the Base Rent set forth in Section 4, Tenant shall
pay to Landlord, at the times and in the manner herein set forth,
Percentage Rent equal to the percentage set forth
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in Section 1(i) hereof times Tenant's Gross Sales (as the term
"Gross Sales" is herein defined), minus the Base Rent.
(b) Time and Manner of Payment
Percentage Rent shall be paid on or before the fifteenth(15th) day
of each calendar month during the term (including the calendar month
next succeeding the last month of the term hereof), and shall be
determined on the basis of a written statement, signed and certified
by Tenant or an officer of Tenant as being true and correct, setting
forth the amount of Tenant's Gross Sales during the calendar month
immediately preceding. Monthly Percentage Rent shall be the product
of the percentage set forth in Section 1(i) times the Gross Sales
from the Premises for such month, minus the Base Rent paid for such
month (but in no event less than zero). Within thirty (30) days
after the end of each Lease Year during the term (including the
thirty-day period next succeeding the end of the last Lease Year of
the term hereof), Tenant shall deliver to Landlord a written
statement, signed and certified by a certified public accountant to
be true and correct, setting forth the total amount of Tenant's
Gross Sales made during the immediately preceding Lease Year, and
the Percentage Rent paid for such year shall be adjusted to a lease
yearly basis (including a proportionate adjustment for Lease Years
that are shorter than 12 months) and ▇▇▇▇▇▇ agrees to pay Landlord,
and ▇▇▇▇▇▇▇▇ agrees to credit Tenant, such amount as may be
necessary to effectuate such adjustment. It is agreed that the
computation of the Percentage Rent shall be made separately for each
Lease Year throughout the term of this Lease, without regard to
Tenant's Gross Sales or Percentage Rent in any other Lease Year.
(c) Gross Sales
The term "Gross Sales" as used herein means the total amount in
dollars of the actual sales price, whether for cash or credit or
partly for cash and partly for credit, of all sales of merchandise
and services and all other receipts of business sales of merchandise
and services and all other receipts of business conducted in or from
the Premises, including all mail or telephone orders received or
filled at the Premises, and including all deposits not refunded to
purchasers, orders taken (although said orders may be filled
elsewhere), receipts from any coin operated machines, and sales by
any subleasee, concessionaire or licensee or otherwise in said
Premises. No deduction shall be allowed for uncollected and
uncollectible credit accounts. Gross Sales shall not, however,
include any sums collected and paid out for any sales or excise tax
imposed by any duly constituted governmental authority, nor shall it
include the exchange of merchandise between authority or the
exchange of merchandise between the stores of Tenant, if any, where
such exchange of goods or merchandise is made solely for the
convenient operation of the business of Tenant and not for the
purpose of consummating a sale which has theretofore been made at,
originated in or from the Premises, or for the purpose of depriving
Landlord of the benefit of a sale which otherwise would be made at,
in or from the Premises, nor any amount of returns to shippers or
manufacturers, nor the amount of any cash or credit refunds made
upon any sale where the merchandise sold or some part thereof, is
thereafter returned by the merchandise sold or some part thereof, is
thereafter returned by the purchaser and accepted by Tenant, nor
sales of fixtures which are not a part of Tenant's stock in trade,
nor receipts from sales of lottery tickets. Any "Gross Sales"
resulting from ▇▇▇▇▇▇'s sale of California State Lottery Tickets
shall be treated in the manner set forth in Section 5(d) hereof.
Each sale upon installment or credit shall be treated as a sale for
the full price in the month during which such sale shall be made,
irrespective of the time when Tenant shall receive payment from its
customers.
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(d) Lottery Rent
Should Tenant sell California State Lottery tickets from the
Premises, in addition to Base Rent and Percentage Rent, Tenant shall
pay Landlord, as additional rent, one and one-half percent (1 1/2 %)
of the gross revenue from sales of lottery tickets sold in, on or
from the Premises ("Lottery Rent"). Said payment shall be made to
Landlord monthly, within ten (10) days after the end of each
calendar month. Tenant's monthly payment of Lottery Rent shall be
accompanied by a statement signed by Tenant setting forth the amount
of Tenant's Gross Sales of lottery tickets from the Premises or the
preceding month, and attaching a copy of the customary monthly or
weekly reports furnished to the California State Lottery commission
or such other agency to which such reports are required to be made.
(e) Maintenance of Records
Tenant shall install upon the Premises a cash register equipped with
a cumulative totaling device which shall be sealed and a daily
continuous tape on which all Gross Sales shall be recorded and
imprinted. Tenant shall keep in the Premises a permanent accurate
set of books and records of all Sales of merchandise and all revenue
derived from business conducted in the Premises during each day of
the term hereof, and all supporting records, including excise tax,
business and occupation tax and gross income tax reports; and such
pertinent records will be kept, retained and preserved for al least
three (3) years after the expiration date of each Lease Year. Tenant
shall keep, retain and preserve for at least three (3) years after
the expiration of each Lease Year all original cash register tapes,
sales records and sales slips or sales checks and any other
pertinent original sales. records. All such records, including sales
tax reports and excise tax reports, shall be open to inspection and
audit of Landlord and its agents at all reasonable times during
ordinary business hours.
(f) Audit or Reports
In the event Landlord is not satisfied with any statement submitted
by ▇▇▇▇▇▇, Landlord shall have the rights to make a special audit,
by auditors selected by Landlord, of the books and records of Tenant
its subtenants, concessionaires and licensees, hereinbefore required
to be kept and preserved. ▇▇▇▇▇▇▇▇'s right to examine ▇▇▇▇▇▇'s books
and records and those of its subtenants, concessionaires and
licensees, as hereinbefore set forth, or to make an audit thereof in
respect to any monthly or annual statement for such monthly or full
lease year period, shall be available to Landlord only for a period
of three (3) years after the applicable monthly or annual statements
for such periods shall have been furnished to Landlord. If such
audit shall show a deficiency in percentage rent for the period
covered, the amount thereof together with interest thereon shall be
paid promptly by Tenant; if such audit shall show percentage rent to
have been overpaid, the excess shall be applied on any amounts then
due to Landlord by Tenant, and the balance, if any, shall be
credited to Tenant's next payment or Base Rent. If any such
statement is round to be incorrect to an extent of more than one
percent (1%) over the figures submitted by ▇▇▇▇▇▇. Tenant shall pay
for such special audit and if such special audit verifies Tenant's
statements to be correct or to vary not more than one percent (1%)
over the figures submitted by Tenant, the expense of such audit
shall be borne by Landlord. The provisions of Sections 5(e) and 5(f)
hereof shall apply in all respects to partial Lease Years.
(g) Lease Year Defined
For the purpose of this Lease, a "Lease Year" shall be taken to mean
each consecutive twelve-month period commencing January 1 and ending
on December 31, provided.
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however, should the commencement date occur on a date other than
January 1, the first Lease Year shall be the period between the
commencement date and the next succeeding December 31, and the last
Lease Year shall be the period between the last January 1st of the
term and ending at the end of the term hereof.
6. CONDITION OF IMPROVEMENTS
Landlord has furnished to Tenant the building shell and the items set
forth in Exhibit "C," entitled "Construction Exhibit." attached hereto and
hereby made a part hereof. Except as therein provided, all interior,
nonstructural improvements to the Premises, including fixturization and
other work on the front or interior of the Premises, shall be performed by
Tenant at Tenant's sole cost and expense, and shall be performed in
accordance with Exhibit "C." Tenant acknowledges that it is accepting the
Premises in their "as-is" condition and that Landlord is not furnishing
any improvements, alterations, or additions to the Premises other than
those set forth in Exhibit "C" hereto. By entry hereunder. Tenant shall be
deemed to have accepted the Premises as being in good, sanitary order,
condition and repair.
7. PARKING AND COMMON AREAS
Landlord covenants that an area approximately equal to the common and
parking areas as shown on the attached Exhibit "A" shall be at all times
available for the non-exclusive use of Tenant during the full term of this
Lease or any extension of the term hereof, provided that the condemnation
or other taking by any public authority, or sale in lieu of condemnation,
of ally or all of such common and parking areas shall not constitute a
violation of this covenant. Landlord reserves the right to change the
entrances, exits, traffic lanes and the boundaries and locations of such
parking area The Landlord shall keep said automobile parking and common
areas in a neat, clean and orderly condition and shall repair any damage
to the facilities thereof, but all expenses in connection with said
automobile parking and common areas shall be charged to Tenant and
prorated in the manner set forth in Section 8 hereof. So long as Tenant is
riot in default hereunder, Tenant, for the use and benefit of Tenant and
its customers, shall have the non-exclusive right in common with Landlord.
and other present and future owners, tenants and their customers, to use
said common and parking areas during the entire term of this Lease, or any
extension thereof, for ingress and egress, and automobile parking;
provided, however, that Tenant shall not be permitted use of parking areas
for employee parking. Tenant, in this use of said common and parking
areas, agrees to comply with such reasonable roles, regulations and
charges for parking as the Landlord may adopt from time to lime for the
orderly and proper operation of said common and parking areas. Such rules
may include but shall not be limited to the regulation of the removal,
storage aid disposal of Tenant's refuse and other rubbish at the sole cost
and expense of Tenant.
8. OPERATING COSTS AND TAXES
(a) Operating Costs and Taxes
There shall be payable as additional rent during the term of this
Lease an amount equal to Tenant's proportional share of the combined
amount of Landlord's "Property Tax Costs" and Landlord's "Operating
Costs" (both as hereinafter defined) for each calendar year. For
purposes of this Section 8(a), the following definitions shall be
applicable: (i) "Property tax Costs" shall be the total of all real
and personal property taxes, assessments, license fees, commercial
rental taxes, liens, penalties or "in lieu" real property taxes (as
defined in power to tax, including any city, county, state and
federal government. and any fire protection, police, sidewalk and
road maintenance, refuse removal, school,
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agricultural. lighting, drainage and other improvement district
thereof). As against any legal or equitable interest of Landlord in
the Premises or in the building of which the Premises are a part. or
the Shopping Center and its common areas (including land, building,
improvements and personalty), as against Landlord's right to rent or
other income therefrom, or as against Landlord's business of leasing
the Premises, any tax increases arising out of a change of ownership
of the Premises or the Shopping Center, and any and all reasonable
costs, including legal fees, incurred in contesting such taxes or in
seeking a reduction in such taxes; (ii) "Operating Costs" shall be
the total of all costs and expenses paid or incurred by Landlord in
connection with the operation, maintenance, repair and replacement
of the Premises (including the roof and building shell), the
building of which the Premises are a part, other Shopping Center
improvements, and the parking and common areas of the Shopping
Center (including land, building, improvements and personalty)
including but not limited to maintenance contracts, water and sewage
charges, insurance premiums, utilities, janitorial services, labor,
supplies, materials, equipment, tools, repairs, replacements,
resurfacing, repainting, re-striping, cleaning. sweeping,
janitorial, replanting, re-landscaping, directional signs and
markers, car stops, security lighting and other utilities.
reasonable deprecation on expenditures for items customarily
allocable to Landlord's capital account (excluding capital
expenditures for structural items which are customarily part of
original construction), and expenditures for owned machinery and
equipment used in connection therewith, professional services, a
management fee equal to fifteen percent (15%) of all the foregoing
Operating Costs to cover Landlord's administrative and overhead
costs, and adequate public liability and property damage insurance
on all improvements in the therewith, professional services, a
management fee equal to fifteen percent (159b) of all the foregoing
Operating Costs to cover Landlord's administrative and overhead
costs, and adequate public liability and property damage insurance
on all improvements in the Shopping Center and the common and
parking areas, in an amount to be determined by Landlord, and all
other things necessary in Landlord's sole and absolute discretion
for the operation and maintenance in a state of good and sanitary
order, condition and repair Depreciation on machinery and equipment
shall be computed over a period of at least five (5) years on a
straight line basis, and depreciation on motor vehicles shall be
computed over a period of al least three (3) years on a straight
line basis. Al arty time hereafter, Landlord shall have the right to
select and license or lease to any person, firm or corporation the
operation and maintenance of the common and parking areas on such
terms and conditions and for such time as Landlord shall, in its
sole judgment, deem reasonable and proper. Any such lease, license
agreement, or contract shall require the lessee, licensee or
operator to be bound by and to perform all of the obligations of
Landlord relative to the maintenance and operation of the Shopping
Center, and shall make the lessee, licensee or operator responsible
to Tenant and all other tenants in the Shopping Center. In the event
this Lease shall commence or terminate on any date other than the
last day of a calendar year, the additional rent payable hereunder
by Tenant for the calendar year in which this I ease commences or
terminates shall be prorated on the ratio that the number of days of
the lease term falling within said calendar years bears to 365 days
Tenant's proportionate share of Landlord's property tax costs and
operating costs shall be determined by dividing the total area of
the Premises by the total leasable area of retail floor space in the
Shopping Center, and multiplying said quotient by the total property
tax costs and operating costs for the Shopping Center.
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(b) Payment Procedure
On or before the first day of April of each calendar year, Landlord
shall furnish to Tenant a written notice advising Tenant of the
total "Property Tax Costs" and "Operating Costs" for the immediately
preceding calendar year of portion thereof and ▇▇▇▇▇▇'s share of
such costs as provided in Section 8(a). On the first occasion when
Tenant is so notified of Tenant's share of such costs for the
preceding year, Tenant shall pay to Landlord the full amount of such
costs within ten (10) days after such written notice, together with
the amount of such costs incurred for each calendar month during the
then current calendar year, including the calendar month in which
the written notice described in this Section 8(b) is received by
Tenant. The amount due for each calendar month during the then
current calendar year shall be a fraction, the numerator being one
(1) and the denominator being the number of months (any partial
month being considered a full month for purposes of this Section
8(b) during the preceding calendar year in which Tenant Occupied the
Premises Commencing with the next monthly installment of rent
payable by Tenant after such notice, Tenant shall, together with
each of the next twelve (12) monthly installments of rent, pay to
Landlord as an estimate of the current year's anticipated costs, an
amount equal to ▇▇▇▇▇▇'s share of the costs for the preceding year
prorated to a monthly amount based on the portion of the term
falling within the immediately preceding calendar year. Thereafter
the same procedure shall be followed as of the first day of April of
each succeeding year except that after the first year in which
Tenant is required to pay such costs, Tenant shall be required to
pay to Landlord within ten (10) days after such annual notice only
the difference between the total amount of the costs payable by
Tenant for the preceding calendar year and the total of the twelve
monthly estimated amounts theretofore paid by Tenant. If for any
calendar year the amount of the costs payable by Tenant shaft be
less than the total of the twelve monthly estimated amounts paid by
Tenant as aforesaid, then the difference shall, at Landlord's
option, either be refunded by Landlord to Tenant or deducted from
the next installment or installments of rent due hereunder. The
failure of Landlord in any year to supply to Tenant the written
notice, above provided, shall not constitute a waiver by Landlord of
its right to collect Tenant's share of the costs for the preceding
calendar year No delay or failure by Landlord to enforce this
Section 8(b), or any part thereof as to Tenant, or to enforce
similar or dissimilar provisions in other leases in use as to any
other tenant in this Shopping Center, shall be deemed to be a waiver
hereof, or prevent any subsequent or other enforcement hereof. All
costs payable by Tenant hereunder shall constitute additional rent,
and upon ▇▇▇▇▇▇'s failure to pay such amounts, Landlord shall have
the same rights and remedies as otherwise provided in this lease for
the failure of Tenant to pay rent.
(c) In Lieu Real Property Taxes
If at any time during the term of this Lease, any authority having
the power to tax, including without limitation any Federal, State,
County, City government or any political subdivision thereof,
hereinafter collectively referred to as "taxing authority" for
purposes of this paragraph only, shall alter the methods and/or
standards of taxation and assessment, hereinafter referred to as the
"tax plan" for purposes of this article only, against the legal or
equitable interests of Landlord in the Premises or the remainder of
the Shopping Center or the underlying realty, in whole or in part,
so as to impose a tax plan in lieu of or in addition to the tax plan
in existence as of the date of this Lease, such taxes or assessments
based upon such other tax plan, including without limitation: (i) a
tax, assessment, excise, surcharge, fee, levy, penalty, bond or
similar imposition, hereinafter collectively referred to as
"impositions, of this Section only, on ▇▇▇▇▇▇▇▇'s right to rental
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or other income from the Premises or as against Landlord's business
of leasing the Premises; (ii) any impositions in substitution or in
lieu, partially or totally, of any impositions assessed upon real
property prior to any such alteration in the tax plan (iii) any
impositions allocable to or measured by the area of the Premises or
the rental payable hereunder, including without limitation any
impositions levied by any taxing authority with respect to the
receipt of such rental or with respect to the possession, leasing,
operation, management, maintenance, alteration, repair, use or
occupancy by Tenant of the Premises or any portion thereof; (iv) any
impositions upon the Lease transaction or any document to which
Tenant is a party which creates or transfers any interest or estate
in or to the Premises; or (v) any special, unforeseen or
extraordinary impositions however described, shall be considered as
"property tax costs" for the purposes of this Lease, excluding,
however, all general income taxes, gift taxes, inheritance taxes and
estate taxes.
9. SECURITY DEPOSIT
Concurrently with ▇▇▇▇▇▇'s execution of this Lease Tenant has deposited
with Landlord a sum equivalent to the sum set forth in Section 1j)
hereof. Said sum shall be held by ▇▇▇▇▇▇▇▇ as security for the faithful
performance by Tenant of all the terms, covenants, and conditions of this
Lease to be kept and performed by ▇▇▇▇▇▇ during the term hereof. If
Tenant defaults with respect to any provision of this Lease, including,
but not limited to the provisions relating to the payment of rent
Landlord may (but shall not be required to) use, apply, or retain all or
any part of this security deposit for the payment of any rent or any
other sum in default, or for the payment of any amount which Landlord may
spend or become obligated to spend by reason of Tenant's default. If any
portion of said deposit is so used or applied Tenant shall, within five
(5) days after written demand therefor, deposit cash with Landlord in an
amount sufficient to restore the security deposit to its original amount,
and Tenant's failure to do so shall be a default under this Lease. If the
monthly Base Rent shall, from time to time, increase during the time of
this Lease, Tenant shall, within five (5) days after written demand
therefor, deposit with Landlord additional security so that the amount of
security deposit held by Landlord shall at all times bear the same
proportion to current Base Rent as Section 1(h) Landlord shall not be
required to keep this security deposit separate from its general funds.
and tenant shall not be entitled to interest on such deposit. If Tenant
shall fully and faithfully perform every provision of this Lease to be
performed by it, the security deposit or any balance thereof shall be
credited against rent and other charges then unpaid, and the balance
shall be returned to Tenant (or, at Landlord's option, to the last
assignee of Tenant's interest hereunder) within thirty (30) days
following expiration of the Lease term. In the event of termination of
▇▇▇▇▇▇▇▇'s interest in this Lease, Landlord shall transfer said deposit
to ▇▇▇▇▇▇▇▇'s successor in Interest.
10. Use
(a) Use
Tenant shall use the Premises solely for the purpose of conducting
the retail business described in Section I(c) of this Lease, and
under the trade name set forth in Section 1(a) of this Lease Tenant
shall not use, or permit the Premises to be used, for any other
purpose or under any other trade name, whatsoever.
(b) Rule and Regulations
Tenant shall at all times during the term of this Lease, at its sole
cost and expense:
9
1. Furnish, install and maintain in the Premises all of
Tenant's merchandise, furniture, trade fixtures, and
equipment (which, together with Tenant's leasehold
improvements, are referred to herein as "Tenant's
Properly") necessary for the operation of Tenant's
business;
2. Maintain the Premises in a clean, neat, sanitary and
orderly condition, it being understood that no use shall
be made or permitted of the Premises, the common and
parking areas, or any part thereof, nor any acts done,
which will violate, make inoperative, or increase the
existing rate of any insurance policy at any time held
by or in any way for the benefit of Landlord pursuant to
any provision of this Lease;
3. Tenant shall not sell, or suffer or permit to be kept,
used or sold in, upon or about the Premises any
gasoline, distillate or other petroleum products or any
other substance or material of an explosive,
inflammable, noxious, toxic, caustic or radiological
nature which may endanger any part of the Premises or
its occupants, business patrons or invitees, or present
any unusual fire, explosion or other damaging or
dangerous hazard or possibility of contamination;
4. Refrain from committing or suffering to be committed any
strip of waste upon, or any unlawful, improper or
offensive use of, the Premises, or any public or private
nuisance or act or thing which may disturb the quiet
enjoyment of any other tenant, concessionaire, licensee
or occupant of the Shopping Center or the customers or
business invitees thereof;
5. Keep all merchandise display windows in the Premises
suitably lighted during such hours as Landlord may
reasonably require, including periods other than or in
addition to the business hours of Tenant:
6. Refrain from dumping, disposal, reduction, incineration
or other burning of any trash, papers, refuse or garbage
in or about the Premises or the common and parking
areas;
7. Store all trash and garbage within the Premises in metal
containers so located as not to be visible to customers
and business invitees in the Shopping Center and so as
not to create or permit any health or fire hazard, and
arrange for the regular removal thereof;
8. Refrain from using or permitting the use of the Premises
or any portion thereof as living quarters, sleeping
quarters or lodging rooms;
9. Refrain from keeping, displaying or selling any
merchandise or any object outside the interior of the
premises, or on any portion of any sidewalks, walkway or
other portion of the parking and common area except
during special sales promotions
10. Tenant shall not do or permit anything to be done in or
about the Premises which will in any way obstruct or
interfere with the rights of other tenants or occupants
of the Shopping Center, or injure or annoy them,
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or use or allow the Premises to be used for any
improper, immoral, unlawful or objectionable purpose;
nor shall Tenant cause, maintain or permit any nuisance
in, on or about the Premises Tenant shall not commit
allow to be committed any waste in, or upon the
Premises;
11. Tenant shall not permit any of Tenant's servants,
employees, agents or sublessees, to park any vehicles in
the common and parking areas of the Shopping Center. In
the event of any violation of the immediately preceding
sentence, Tenant shall pay to Landlord a penalty of
twenty dollars ($20.00) per day per violation.
In addition to the foregoing, Tenant shall at all times during the term hereof
comply with all the reasonable rules and regulations which Landlord may at any
time or from time to time establish concerning the use of the Premises and
common and parking areas for shipping, receiving, loading and unloading
merchandise; provided, however, that any such rule or regulation so made shall
not be inconsistent with any part of this Lease, shall not unreasonably
interfere with Tenant's use and enjoyment of the Premises, and shall be enforced
without discrimination among tenants similarly affected.
(c) Prohibited Operations
No use or operation will be made, conducted or permitted on or with
respect to all or any parts of the Shopping Center, which use or
operation is obnoxious to or out of harmony with the operations of a
first-class shopping center, including (but not limited to) the
following: any noise or sound that is objectionable due to
intermittence, beat, frequency, shrillness or loudness; any
obnoxious odor; any warehouse (but any area for the storage of goods
intended to be sold at any retail establishment in the Shopping
Center shall not be deemed to be a warehouse), assembly, manufacture
or distillation and "second hand" store, Army, Navy or Government
"surplus" store, or a store commonly referred to as a "discount
house, any trailer court, labor camp, junk yard, stock yard, or
animal raising (other than pet shop); any drilling for and/or
removal of subsurface substances; and any fire or bankruptcy sale or
auction house operation.
(d) Continuous Operation
Tenant expressly covenants to, and it is of the essence of this
Lease that Tenant shall open for business on the Commencement Date
(as herein defined), and shall continuously and uninterruptedly
throughout the term hereof keep the Premises open for business
during all hours established by the Landlord for the Shopping Center
and, at Tenant's option, during any additional hours. In the event
the hours during which the Shopping Center is legally permitted to
be open for business are regulated by any authority claiming
jurisdiction, then Landlord shall be the sole judge of which hours
and days shall be the Shopping Center business hours. Tenant further
agrees that all such times it shall have upon the Premises a
sufficient number of employees and a sufficient stock of merchandise
adequately to serve the patrons thereof, and will in general employ
its best judgment, efforts and abilities to produce the maximum
volume of sales from the Premises.
11. Compliance with Law
Tenant shall not use the Premises, or permit anything to be done in or
about the Premises or the common and parking areas, which will in any way
conflict with any law, statute, ordinance or governmental rule or
regulation now in force or which may hereafter be enacted or promulgated.
Tenant shall, at its sole cost and expense, promptly comply with all laws,
statutes, ordinances and
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Governmental rules, regulations and requirements now in force or which may
hereafter be in force, and with the requirements of any board of fire
underwriters or other similar bodies now or hereafter constituted,
relating to or affecting the condition, use or occupant of the Premises,
excluding structural charges rot related to or affected by ▇▇▇▇▇▇'s
improvements or acts. The judgment of any court of competent jurisdiction
or the admission of Tenant in any action against Tenant, whether Landlord
be a party thereto or not, that Tenant has violated any law, statute,
ordinance or governmental rule, regulation or requirement, shall be
conclusive of that fact as between the Landlord and Tenant.
12. Alterations and Additions
Tenant shall not make or allow to be made any alterations, additions, or
improvements to the Premises or any part thereof (except non-structural
and non-systemic, i.e., HVAC, plumbing or electrical, interior alterations
costing no more than $2,500 in any calendar year) without first obtaining
the written consent of Landlord, which consent shall not unreasonably be
withheld. Any alterations, additions or improvements to or of said
Premises including, but not limited to, wall coverings, paneling and
built-in cabinet work (but excepting movable furniture and trade
fixtures), shall upon expiration or sooner termination of the Lease become
a pad of the realty and belong to the Landlord and shall be surrendered
with the Premises All alterations and additions to the Premises shall
conform to applicable local building, health, and safety codes, and Tenant
shall obtain all necessary and applicable building permits prior to
commencement of construction. In the event Landlord consents to the making
of any alterations, additions or improvements to the Premises by Tenant,
the same shall be made by Tenant at Tenant's sole cost and expense Upon
the expiration or sooner termination of the term hereof, Tenant shall,
upon written demand by ▇▇▇▇▇▇▇▇, given at least thirty (30) days prior to
the end of the term, at Tenant's sole cost and expense, repair any damage
to the Premises caused by such removal.
13. REPAIRS
(a) Tenant's Responsibilities
Tenant shall, at Tenant's sole cost and expense, keep the Premises
and every part thereof in good condition and repair (except as
hereinafter provided with respect to Landlord's obligations)
including without limitation, the maintenance, replacement and
repair of any storefront, doors, window casements, glazing,
plumbing, pipes, electrical wiring and conduits, heating and air
conditioning system (when there is an air conditioning system).
Tenant shall obtain a service contract for repairs and maintenance
contract to conform to the requirements under the warranty, if any,
on said system. If this Lease covers premises in which food is
prepared, sold or consumed, Tenant covenants regularly to inspect
and maintain in good order and repair all grease traps, vent hoods
and pans, to provide a minimum monthly cleaning of all hood filters
and grease traps by a contractor approved by Landlord in writing.
All vent hoods are to be equipped with a UL approved automatic
extinguisher system satisfactory to Landlord's architect. Any damage
to adjacent premises caused by ▇▇▇▇▇▇'s use of the Premises shall be
repaired by Tenant at the sole cost of Tenant.
(b) Landlord's Responsibility
Notwithstanding the provisions of Section 13(a) hereinabove,
Landlord shall repair and maintain the structural portions of the
building of which the Premises are a part, including the exterior
walls and roof, unless such maintenance and repairs are caused in
part or in whole by the act, neglect, fault or omission of any duty
by the Tenant, its agents, servants, employees, invitees, or any
damage caused by breaking and entering, in which case
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Tenant shall reimburse Landlord for the actual cost of such
maintenance and repairs. Landlord shall not be liable for any
failure to make such repairs or to perform any maintenance, unless
such failure shall persist for an unreasonable time after written
notice of the need of such repairs or maintenance is given to
Landlord by Tenant. Except as provided in Section 25 hereof, there
shall be no abatement of rent and no liability of Landlord by reason
of any injury or interference with ▇▇▇▇▇▇'s business arising from
the making of any repairs alterations or improvements in or to any
portion of the Shopping Center or the Premises, or in or to
fixtures, appurtenances and equipment therein. tenant waives the
right to make repairs at Landlord's expense under any law, statute
or ordinance now or hereafter in effect.
14. LIENS
Tenant shall keep the Premises and the property in which the Premises are
situated free from any liens arising out of any work performed, materials
furnished or obligations incurred by or on behalf of Tenant. Landlord may
require, at ▇▇▇▇▇▇▇▇'s sole option, that Tenant shall provide to Landlord,
at Tenant's sale cost and expense, a lien and completion bond in an amount
equal to one and one- half (1 1/2) limes the estimated cost of any
improvements, additions or alterations in the Premises which the Tenant
desires to make, to insure Landlords against any liability for mechanics'
or materialmen's liens and to insure completion of the work. If Tenant
desires to contest any claim of lien, it shall within fifteen (15) days
after the filing of the lien for record, furnish Landlord with cash
security in the amount of the claim of lien, plus estimated costs and
interest, or shall furnish Landlord with a bond of a discharge of the
lien. Nothing contained herein shall prevent Landlord, at the cost and for
the account of Tenant, from obtaining and filing a bond conditioned upon
the discharge of such lien, in the event Tenant fails or refuses to
furnish the same within said fifteen (15) day period Immediately upon
entry of final judgment in any such action in which Tenant contests any
such claim of lien, any pad thereof, and within fifteen (15) days after
the filing of any lien for record which Tenant does not contest, Tenant
shall fully pay and discharge such judgment or lien, as the case may be,
and Tenant shall reimburse Landlord upon demand for any and all loss,
damage and expense, including reasonable attorneys' fees, which Landlord
may suffer or be put to by reason thereof. Nothing contained herein shall
prevent Landlord, at the cost and for the account of ▇▇▇▇▇▇, from
satisfying any such judgment or lien, as the case may be, in the event
Tenant fails or refuses to satisfy the same as herein provided.
15. ASSIGNMENT AND SUBLETTING
(a) Limitations
Tenant shall not either voluntarily, or by operation of law, assign,
transfer, mortgage, pledge, hypothecate or encumber this Lease or
any interest therein, and shall not sublet the said Premises or any
part thereof, or any right or privilege appurtenant thereto, to
allow any other person (employees, agents, servants and invitees of
Tenant excepted), to occupy or use the said Premises, or any portion
thereof, without first obtaining the written consent of Landlord. A
consent to one assignment, subletting, occupation or use by any
other person shall not be deemed to be consent to any subsequent
assignment, subletting, occupation or use by another person. Consent
to any such assignment or subletting shall in no way relieve Tenant
of any liability under this Lease. Any such assignment or subletting
without such consent shall be void, and shall, at the option of the
Landlord, constitute a default under the terms of this Lease.
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(b) Reimbursement
In the event that Landlord shall consent to a sublease or assignment
hereunder, Tenant shall reimburse Landlord is reasonable attorneys'
fees, not to exceed Five Hundred and No/100ths ($500.00) Dollars,
incurred in connection with the processing of documents necessary to
effectuate the same in accordance with this Lease.
(c) No Unreasonable Withholding of Consent
Landlord shall not unreasonably withhold its consent to an
assignment or subletting for a permitted use and under the same
trade name as provided in Section 1(c). The foregoing Is not
intended to imply any waiver of Landlord's reservation of the
absolute right to disapprove assignments of subleases for uses that
diner in any material respect from the use expressly permitted in
Section l(c) of this Lease, or of Landlord's right to withhold
consent on any other commercially reasonable basis. In determining
whether or not to consent to the proposed assignment or subleasing,
Landlord may consider, among other factors, the experience and
business reputation for the proposed sublease or assignee in
operating a business for the use set forth in Section l(c), whether
the existing level of sales volume is likely to be sustained by the
prospective assignee or subtenant, whether ▇▇▇▇▇▇▇▇'s consent will
result in a breach of any other lease or agreement to which Landlord
is a party affecting the Shopping Center, the effect on the "tenant
mix" or "balance" in the Shopping Center that Landlord is trying to
maintain or to achieve, and whether the proposed sublessee or
assignee has a net worth equal to or greater than Tenant. If
Landlord does not consent to ▇▇▇▇▇▇'s assignment or subleasing of
all or any portion of the Premises, the Base Rent set forth in
Section 1(h) of this Lease shall be deemed to be changed to equal
the sum of the Base Rent plus one-twelfth (1112) the Percentage Rent
required to be paid by Tenant pursuant to this Lease during the
twelve (12) month period immediately preceding such assignment or
subletting. No consent by Landlord to any assignment or subletting
by Tenant shall relieve Tenant of any obligation to be performed by
Tenant under this Lease, whether occurring before or after such
consent, assignment or subletting. The acceptance of rent by
Landlord from any other person shall not be deemed a waiver by
Landlord of any provision of this Lease, or to be a consent to any
assignment, subletting or other transfer, or to be a release of
Tenant from any obligation under this Lease Each assignee or
subtenant shall jointly assume all obligations of the Tenant under
this Lease, and shall be and remain liable jointly with Tenant for
the payment of rent, and for the due performance of all the terms,
covenants, conditions and agreements herein contained on Tenant's
part to be performed for the term of this Lease. No assignment shall
be binding on Landlord unless such assignee or sublessee shall
deliver to Landlord a counterpart of such assignment or sublease
(and any related collateral agreements) and an instrument in
recordable form which contains a covenant of assumption by the
assignee or sublessee. Such an instrument of assumption shall not
waive, release or discharge the assignee or sublessee from its
liability. If Tenant is a partnership, a transfer of any interest of
a general partner, a withdrawal of any general partner from the
partnership, or the dissolution of the partnership, shall be deemed
to be an assignment of this Lease. If Tenant is a corporation,
unless Tenant is a public corporation, viz., whose stock is
regularly traded on a national stock exchange, or is regularly
traded in the over-the-counter market and quoted on NASDAQ, any
dissolution, merger, consolidation, or other reorganization of
Tenant or sale or other transfer of a percentage of capital stock of
Tenant which results in a change of controlling persons, or the sale
or other transfer of substantially all of the assets of Tenant,
shall be deemed to be an assignment of this Lease.
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(d) Assignment as a Result of Tenant's Bankruptcy
(i) In the event this Lease is assigned to any person or entity
pursuant to provisions of the Bankruptcy Code, 11 USC 1101, et seq.
(the "Bankruptcy Code"), any and all monies or other consideration
payable or otherwise to be delivered in connection with such
assignment shall be paid or delivered to Landlord, shall remain the
exclusive property of Landlord, and shall not constitute property of
Tenant or of the estate of Tenant within the meaning of the
Bankruptcy Code. Any and all monies or other consideration
constituting Landlord's property under the preceding sentence not
paid or delivered to Landlord shall be held in trust for the benefit
of Landlord and be promptly paid to or turned over to Landlord; (ii)
If Tenant, pursuant to this Lease, proposes to assign the same
pursuant to the provision of the Bankruptcy Code, any person or
entity who shall have made a bona fide offer to accept an assignment
of this Lease on terms acceptable to Tenant, then notice of the
proposed assignment setting forth (a) the name and address of such
person, (b) all of the terms and conditions of such offer, and (c)
the assurances referred to in Section 365 (b)(3) of the Bankruptcy
Code, shall be given to the Landlord by the Tenant no later than
twenty (20) days after receipt of such offer by the Tenant, but in
any event no later than ten (10) days prior to the date that Tenant
shall make application to a court of competent jurisdiction for
authority and approval to enter into such assignment and assumption,
and Landlord shall thereupon have the prior right and option, to be
exercised by notice to the Tenant given at any time prior to the
effective date of such proposed assignment, to accept an assignment
of this Lease upon the same terms and conditions and for the same
consideration, if any, as the bona tide offer made by such person,
less any brokerage commissions which may be payable out of the
consideration to be paid such person for the assignment of this
Lease; (iii) Any person or entity to which this Lease is assigned
pursuant to the provisions of the Bankruptcy Code shall be deemed
without further act or deed to have assumed all of the obligations
arising under this Lease on or after the date of such assignment.
Any such assignee shall, upon demand, execute and deliver to
Landlord an instrument confirming such assumption; (iv) The
following factors may be considered by the Landlord as necessary in
order to Determine whether or not the proposed assignee has
furnished Landlord with adequate assurances of its ability to
perform the obligations of this Lease:
1. The adequacy of a security deposit.
2. Net worth and other financial elements of the proposed
assignee.
3. Demonstration that percentage rent will not decline
substantially and that assumption or assignment will not
disrupt substantially the tenant mix or balance in the
Shopping Center;
(v) It is hereby acknowledged that this is a lease within a shopping
center within the meaning of Section 365(b)(3) of the Bankruptcy
Code; (vi) In the event Landlord rejects the proposed assignee, the
rights and obligations of the parties hereto shall continue to be
governed by the terms of this Lease, and Tenant shall have all the
rights of a Tenant under applicable California law.
(e) Effect of Violation
Any purported assignment, mortgage, pledge, hypothecation,
encumbrance, subletting or license of this Lease, the leasehold
estate hereby created, or the Premises or any portion thereof,
either voluntarily or involuntarily, whether by operation of law or
otherwise, or any other action by Tenant in violation of the
restrictions set forth in this Section, shall be null and void and
shall, at the option of Landlord, terminate this Lease.
15
16. HOLD HARMLESS
Tenant shall indemnify and hold harmless Landlord against and from any and
all claims arising from Tenant's use of the Premises, common and parking
areas, or from the conduct of its business or from any activity, work, or
other things done, permitted or suffered by the Tenant in or about the
Premises, common and parking areas, and shall further indemnify and hold
harmless Landlord against and from any and all claims arising from any
breach or default in the performance of any obligation on ▇▇▇▇▇▇'s part to
be performed under the terms of this Lease, or arising from any act or
negligence of the Tenant, or any officer, agent, employee, guest, or
invitee of Tenant, and from all costs, attorneys' fees, and liabilities
incurred in or about the defense of any such claim or any action or
proceeding brought thereon, and in case any action or proceeding be
brought against Landlord by reason of such claim, Tenant upon notice from
Landlord shall defend the same at Tenant's expense by counsel reasonably
satisfactory to Landlord Tenant, as a material part of the consideration
to Landlord, hereby assumes all risk of damage to property or injury to
persons in, upon or about the Premises, common and parking areas and
Tenant hereby waives all claims in respect thereof against Landlord,
except for personal injuries caused solely by ▇▇▇▇▇▇▇▇'s negligence.
Tenant shall give prompt notice to Landlord in case of casualty or
accidents in the Premises.
17. INSURANCE
(a) Liability Insurance
Tenant agrees, at ▇▇▇▇▇▇'s sole cost and expense, to procure and
maintain throughout the term of this Lease, a policy or policies of
insurance insuring Landlord and Tenant from all claims, demands or
actions for injury to or death of any person or persons, howsoever
occasioned, and property damage, with liability limits of not less
that $2,000,000 combined single limit per occurrence for personal
Injury or death and/or property damage claims made by or on behalf
of any person or persons, firm or corporation arising from, related
to, or made by or on behalf of any person or persons, firm or
corporation arising from, related to or connected with the conduct
and operation of Tenant's business in the Shopping Center Landlord
may require Tenant to increase said insurance liability limit, not
more than once per Lease Year, as reasonably necessary Landlord (and
at Landlord's option. any other persons, firms, or corporations
designated by Landlord) shall be named as an additional insured on
any such policy of insurance Tenant shall carry like coverage
against loss or damage by boiler or internal explosion by boilers,
if there is a boiler in the Premises Said insurance shall not be
subject to cancellation except after at least ten days' prior
written notice to Landlord, and the policy or policies, or duly
executed certificates for the same, together with satisfactory
evidence of the payment of the premiums thereon, shall be deposited
with Landlord at the commencement of the term and any renewals
thereof not less than thirty (30) days prior to the expiration of
the term of such coverage if Tenant fails to comply with such
requirement, Landlord may obtain such insurance and keep the same in
effect, and Tenant shall pay to Landlord the premium cost thereof
upon demand, together with interest at the maximum legal rate on all
sums advanced by Landlord, plus a 25% handling charge.
(b) Property insurance
Tenant agrees to procure and maintain fire and extended coverage
insurance in an amount equal to at least one hundred percent (100%)
of the replacement cost of Tenant's furniture, fixtures,
merchandise, inventory, signs, equipment and personal property
located in, on or about the Premises. Tenant does hereby agree that
is shall not make any
16
claim against or see to recover from Landlord any loss or damage to
its property or the property of others, resulting from any hazard
insurable against by such policy
(c) Generally
If Tenant shall fail to procure and maintain any of the above
described insurance coverage, Landlord may, but shall not be
required to, procure and maintain same, but at the expense of
Tenant. All insurance required hereunder shall be in companies rated
AAA or better in Best's Insurance Reports. Tenant shall deliver to
Landlord, poor to right of entry, copies of policies of liability
and property damage insurance required herein of certificates
evidencing the existence and amounts of such insurance with loss
payable clauses satisfactory to Landlord. No policy shall be
cancellable or subject to reduction of coverage, except upon thirty
(30) days prior written notice to Landlord. All such policies shall
be written as primary policies not contributing with and not in
excess of coverage which Landlord may carry.
(d) Subrogation
Landlord and Tenant hereby mutually waive their respective rights of
recovery against each other for any loss insured by fire, extended
coverage and other property any special endorsements, if required by
their insurer to evidence compliance with the aforementioned waiver.
18. UTILITIES
Tenant shall pay for all water, gas, heat, light, power, sewer charges,
telephone service and all other services and utilities supplied to the
Premises, together with any taxes thereon. If any such serviced are not
separately metered to Tenant, Tenant shall pay a reasonable proportion to
be determined by Landlord of all charged jointly metered with other
premises
19. PERSONAL PROPERTY
Tenant shall pay, or cause to be paid, before delinquency any and all
taxes levied or assessed and which become payable during the term hereof
upon all Tenant's leasehold improvements, equipment, furniture, fixtures,
and any other personal property located in the Premises. In the event any
or all of the Tenant's leasehold improvements, equipment, furniture,
fixtures and other personal property shall be assessed and taxed with the
real property Tenant shall pay to Landlord its share of such taxes within
ten (10) days after delivery to Tenant by Landlord of a statement in
writing setting forth the amount of such taxes applicable to Tenant's
property.
20. COMPETITIVE BUSINESS
Tenant agrees that if Tenant or Tenant's franchiser or licensor, either
directly or indirectly, as an individual or as a member of a partnership
or as a stockholder, director, officer or employee of a corporation, or
pursuant to a franchise or license agreement, owns, operates, manages or
engages in any similar or competing business within the radius set forth
in Paragraph 1(l), Tenant's gross sales (as the term "gross sales" is
defined herein) in, upon or from said similar or competing business shall
be added to, included in and deemed to be a part of ▇▇▇▇▇▇'s gross sales
hereunder, and the same shall be computed and accounted for to Landlord in
the same manner herein provided for the computation and accounting of
▇▇▇▇▇▇'s gross sales in, upon or from the Premises.
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21. HOLDING OVER
If Tenant remains in possession of the premises or any part thereof after
the expiration of the term hereof without the express written consent of
Landlord, such occupancy shall be a tenancy from month to month at a
monthly rental in the amount of twice the last monthly Base Rent, plus all
other charges payable hereunder, and upon all the terms hereof applicable
to a month to month tenancy.
22. ENTRY BY LANDLORD
Landlord reserves and shall have the right, at any and all limes during
the customary business hours, to enter the Premises to inspect the same,
to submit said Premises to prospective purchasers of tenants, to post
notices of non-responsibility, to repair the Premises and any portion of
the Shopping Center of which the Premises are a part that Landlord may
deem necessary and desirable, without abatement of rent, and may for that
purpose erect scaffolding and other necessary structures where reasonably
required by the character of the work to be performed, always providing
that the entrance to the Premises shall not be unreasonably blocked
thereby, and further providing that the business of the Tenant shall not
be interfered with unreasonably. Tenant hereby waives any claim for
damages, or for any injury or inconvenience to or interference with
▇▇▇▇▇▇'s business, or for any loss of occupancy or quiet enjoyment of the
Premises, and any other loss occasioned thereby. For each of the aforesaid
purposes. Landlord shall at all times have and retain key with which to
unlock all of the doors in, upon and about the Premises, excluding
Tenant's vaults, safes and files, and Landlord shall have the right to use
any and all means which Landlord may deem proper to open said doors in an
emergency, in order to obtain entry to the Premises without liability to
Tenant except for any failure to exercise due care for Tenant's property,
and any entry to the Premises obtained by Landlord by any of said means,
or otherwise, shall not under any circumstances be construed or deemed to
be a forcible or unlawful entry into, or a detainer of, the Premises, or
an eviction of Tenant from the Premises or any portion thereof.
23. TENANT'S DEFAULT
(a) Any of the following events shall constitute a default under this
Lease by Tenant:
(i) Failure by Tenant to make any payment of rent or other payment
required by this Lease when the same is due, and the
continuance of such failure for a period of three (3) days
after written notice thereof from Landlord to Tenant;
(ii) The vacating (except as may be necessary to facilitate the
reoccupancy of the Premises for a permitted use pursuant to an
assignment or subletting authorized under the terms hereof) or
the abandoning (which is deemed to include absence from the
Premises for more than ten (10) days while in default of any
material provision of this Lease) of the Premises by ▇▇▇▇▇▇;
(iii) Except as expressly permitted under this Lease, any attempted
conveyance, assignment, mortgage or subletting of this Lease;
(iv) The making by Tenant of any general assignment or general
arrangement for the benefit of creditors; the filing by or
against Tenant of a petition to have Tenant adjudged a
bankrupt or a petition for reorganization or arrangement under
any law related to bankruptcy (unless, in the case of a
petition filed against ▇▇▇▇▇▇, the same is dismissed within
sixty (60) days); the taking of any action at the
18
corporate or partnership level by Tenant to authorize any of
the foregoing actions on behalf of Tenant; the appointment of
a trustee or receiver to take possession of substantially all
of Tenant's assets located at the Premises or of Tenant's
interest in this Lease unless possession is restored to Tenant
within thirty (30) days; or the attachment, execution or other
judicial seizure of substantially all of Tenant's interest in
this Lease, where such seizure is not discharged within thirty
(30) days;
(v) The failure by Tenant to observe or perform any material
covenant, condition, or provision in this Lease not already
specifically mentioned in this Section 23(a), where such
failure continues for thirty (30) days after written notice
from Landlord notifying Tenant of such failure; provided,
however, that if the nature of Tenant's failure is such that
more than thirty (30) days are reasonably required for its
cure, then Tenant shall not be in default if it begins such
cure within the thirty (30) day period described above and
thereafter diligently prosecutes such cure to completion.
(b) In the event of any default by Tenant, Landlord may promptly or at
any lime thereafter, upon notice and demand and without limiting
Landlord in the exercise of any other right or remedy which Landlord
may have by reason of such default or breech:
(i) Terminate ▇▇▇▇▇▇'s right to possession of the Premises by any
lawful means, in which case this Lease shall terminate and
Tenant shall immediately surrender possession of the Premises
to Landlord. In such event, Landlord shall be entitled to
recover from Tenant:
(A) The worth at the time of award of the unpaid rent which
had been earned at the time of termination:
(B) The worth at the time of award of the amount by which
the unpaid rent which would have been earned after
termination until the time of the award exceeds the
amount of such rental loss that Tenant proves could have
been reasonably avoided;
(C) The worth at the time of award of the amount by which
the unpaid rent for the balance of the term after the
time of award exceeds the amount of such rental loss the
Tenant proves can reasonably be avoided; and
(D) Any other amount necessary to compensate Landlord for
all detriment proximately caused by Tenant's failure to
perform its obligations under this Lease of which in the
ordinary course of things would be likely to result
therefrom, including, but not limited to, the cost of
recovering possession of the Premises; expenses of
reletting (including advertising), brokerage commissions
and fees, costs of putting the Premises in good order,
condition and repair, including necessary renovation and
alteration or the Premises, reasonable attorneys' fees,
court costs, all costs for maintaining the Premises, all
costs incurred in the appointment of and performance by
a receiver to protect the Premises or Landlord's
interest under the Lease, and any other cost.
19
The "worth at the time of award" of the amounts referred to in subsections (A)
and (B) above shall be computed by allowing interest at the rate of twelve
percent (12%) per annum. The "worth at the time of award" of the amount referred
to in subsection (C) above shall be computed by discounting such amount at one
(1) percentage point above the discount rate of the Federal Reserve Bank of San
Francisco at the time of award; or
(ii) Pursue any other remedy now or hereafter available to Landlord
under the laws judicial decisions of the State of California.
(c) Even though ▇▇▇▇▇▇ has breached this Lease and abandoned the
Premises, at Landlord's option this lease shall continue in effect
for so long as Landlord does not terminate ▇▇▇▇▇▇'s right to
possession, and Landlord may enforce all of its rights and remedies
hereunder, including the right of recover rent as it comes due under
this Lease, and in such event Landlord will permit Tenant to sublet
the Premises or to assign his interest in the Lease, or both, with
the consent of Landlord, which consent will not unreasonably be
withheld provided the proposed assignee or sublessee is reasonably
satisfactory to Landlord as to credit and will occupy the Premises
for the same purposes specified herein, and such tenancy is not
inconsistent with ▇▇▇▇▇▇▇▇'s commitments to other tenants in the
Building. For purposes of this subsection (c), the following shall
not constitute a termination of Tenant's right to possession: (i)
acts of maintenance or preservation or efforts to relet the
Premises; or (ii) the appointment of a receiver under the initiative
of Landlord to protect ▇▇▇▇▇▇▇▇'s interest under this Lease.
(d) Should Landlord at any time terminate this Lease for any default,
breach or failure of Tenant hereunder, then, in addition to any
other rights or remedies available to Landlord hereunder or by law
provided, Landlord may have and recover from Tenant all damages
Landlord may incur by reason of such default, breach or failure
including, without limitation, damages for loss of Percentage Rent
determined in accordance with Section 23(e) hereof, all costs of
recovering possession, all costs and expenses of any re-letting
including, without limitation all costs alterations and repairs,
dividing and subdividing, of the Premises in connection therewith,
all brokerage commissions or other similar expenses of Landlord in
connection with such re-letting, or, at the option of Landlord,
Landlord may have and recover from Tenant the worth at the time of
termination of this Lease, of the excess, if any, of the total Base
Rent and Percentage Rent and other charges reserved in this Lease
for the remainder of the ten hereof, over the then reasonable rental
value of the Premises for the same period, all of which amounts,
including attorneys' fees of Landlord, shall be immediately due and
payable by Tenant to Landlord.
(e) Should Landlord at any time terminate this Lease for any default,
breach or failure of Tenant to satisfy its obligations, hereunder,
the rent for each month of the balance of the Lease term hereof
shall be deemed to be an amount equal to the average (computed on
and adjusted to a monthly basis) of the total Base Rent, Percentage
Rent and other charges paid or payable by Tenant to Landlord
hereunder annually during the three (3) full Lease Years immediately
preceding the date of the default. It is agreed that, if there shall
rot have been three (3) full Lease Years immediately preceding the
date of default, it would be impracticable or extremely difficult to
prove what amount of Percentage Rent hereunder would have been paid
or payable hereunder by Tenant throughout the balance of the term of
this Lease if Tenant had not defaulted, and no other remedy would be
adequate, convenient or feasible. Accordingly, the parties agree
that, in such event, the amount of the Percentage Rent which would
have been paid or payable by Tenant each
20
month throughout the term of this Lease if Tenant had not defaulted
shall be whichever of the following sums is the greater:
(i) A sum equal to twenty-five percent (25%) of the Base Rent, or
(ii) An amount equal to the average, computed on and adjusted to a
monthly basis, of the total Percentage Rentals paid by Tenant
from the period from the Commencement Date to the date of
default.
(f) Tenant hereby acknowledges that late payment by Tenant to Landlord
of rent and other charges due under this Lease will cause Landlord
to incur costs not contemplated by this Lease, the exact amount of
which will be extremely difficult to ascertain. Such costs include,
but are not limited to processing and accounting charges, and late
charges which may be imposed on Landlord by the terms of any
mortgage or trust deed covering the Premises. Accordingly, if any
installment of rent or any charge due from Tenant is not received by
Landlord or Landlord's designee within ten (10) days after such
amount shall be due, then, at ▇▇▇▇▇▇▇▇'s election and upon
▇▇▇▇▇▇▇▇'s demand, Tenant shall pay to Landlord a late charge equal
to fifteen percent (15%) of such overdue amount, and in such event
the parties hereby agree that such late charge represents a fair and
reasonable estimate of the costs Landlord will incur by reason of
the late payment by Tenant. No late charge may be imposed more than
once for the same late rental payment. Acceptance of such late
charge by Landlord shall in no event constitute a waiver of Tenant's
default with respect to such overdue amount, nor prevent Landlord
from exercising any other rights and remedies granted to it
hereunder.
(g) In the event of the occurrence of any of the events specified in
Section 23(a)(iv), if Landlord shall not choose to exercise, or by
law shall not be able to exercise, its rights hereunder to terminate
this Lease upon the occurrence of such events, then, in addition to
any other rights of Landlord hereunder or by law, neither ▇▇▇▇▇▇, as
debtor-in- possession, nor any trustee or other person (hereinafter
collectively called the "Assuming Tenant") shall be entitled to
assume this Lease unless, on or before the date of such assumption,
the Assuming Tenant cures or provides adequate assurance that the
latter will promptly cure any existing default under this Lease and
will promptly compensate Landlord for any pecuniary loss (including,
without limitation, attorneys' fees and disbursements) resulting
from such default, and provides adequate assurance of future
performance under this Lease, it being covenanted and agreed by the
parties that, for such purposes, any cure or compensation shall be
effected by the immediate correction or bonding of any non-monetary
default; and "adequate assurance" of such cure or compensation shall
be effected by the establishment of an escrow fund for the amount at
issue or by bonding, it being covenanted and agreed by Landlord and
▇▇▇▇▇▇ and the foregoing provision has a material part of the
consideration for this Lease.
(h) All covenants and agreements to be performed by Tenant under any of
the terms of the Lease shall be at its sole cost and expense and,
except as otherwise specifically provided herein, without any
abatement of rent. If Tenant shall fail to pay any sum of money,
other than rent, required to be paid by it hereunder or shall fail
to perform any other act on its part to be performed hereunder, and
such failure shall continue for thirty (30) days after notice
thereof by Landlord, Landlord may, but shall not be obligated so to
do, and without waiving any rights of Landlord or releasing Tenant
from any obligations of Tenant hereunder, make such payment or
perform such other ad at Tenant's cost. All sums so paid by ▇▇▇▇▇▇▇▇
and all such necessary incidental costs together with interest
21
thereon from the date of such payment by ▇▇▇▇▇▇▇▇ in connection with
the performance of any such payment by Landlord in connection with
the performance of any such act by Landlord shall be considered rent
hereunder. Except as otherwise in this Lease expressly provided,
such rent shall be payable to Landlord on demand, or at the option I
Landlord, in such installments as Landlord may elect and may be
added to any other rent then due or thereafter becoming due under
this Lease, and Landlord shall have (in addition to any other right
or remedy of Landlord) the same rights and remedies in the event of
the nonpayment thereof by Tenant as in the case of default by Tenant
in the payment of any other rent due hereunder.
24. DEFAULT BY LANDLORD
(a) Landlord shall not be in default unless Landlord fails to perform
obligations required of Landlord within a reasonable time, but in no
event later than thirty (30) days after written notice by Tenant to
Landlord specifying wherein Landlord has failed to perform such
obligation: provided, however, that if the nature of Landlord's
obligation is such that more than thirty (30) days are required for
performance then Landlord shall not be in default in Landlord
commences performance within such thirty (30) day period and
thereafter diligently prosecutes the same to completion, in no event
shall Tenant have the right to terminate this Lease as a result of
Landlord's default, and ▇▇▇▇▇▇'s remedies shall be limited to
damages.
(b) Should Landlord fail to observe or perform any of the covenants or
conditions contained in the Lease, Tenant shall give written notice
to all beneficiaries of deeds of trust recorded against the real
property of which the Premises are a part, setting forth the nature
of Landlord's default. Such lenders shall have a reasonable period
of time to cure the default and perform any act which may be
necessary to prevent the forfeiture of the rights of Landlord under
this Lease and a termination of this Lease as if the payments and
acts were performed by Landlord instead of by the lenders. If the
lenders cannot reasonably lake the action required to cure
Landlord's default without foreclosing Landlord's interest and being
in possession of the Building, the time within which the default
must be cured to avoid a termination of forfeiture of the Lease
shall be extended to include the period of time required for such
lenders to obtain possession and to effect a cure with due diligence
if such lender gives Tenant a written agreement to cure the default.
In the absence of title lenders' express written consent, such an
agreement by the lenders shall not be considered an assumption by
the lenders of Landlord's other obligations under the Lease and
Landlord shall remain solely liable for the performance of all
terms, covenants and conditions of the Lease both prior and
subsequent to the lenders' exercise of any right to cure or waiver
of a breach or default under the r7ote, deed of trust, or any other
instrument given as security.
25. RECONSTRUCTION
(a) If, at any time after the execution of this Lease, the Premises, or
any portion thereof, should be damaged or destroyed by any casualty
insured under any fire and extended coverage insurance policy or
policies, the following provisions shall govern the rights and
obligations of Landlord and Tenant:
(i) If such damage or destruction occurs during the last two (2)
years of the term of this Lease and is to the extent of
twenty-five percent (25%) or more of the then current actual
cash value of the improvements so damaged (whether or not
22
Tenant elects to pay for such repair or restoration), either
party may elect to terminate this Lease by giving at least
fifteen (15) days written notice of its said election to the
other ▇▇▇▇▇, such notice to be given within thirty (30) days
after the date of such damage or destruction. If neither party
shall so elect to terminate this Lease, the parties shall
repair, reconstruct or restore the Premises in accordance with
the provisions of subparagraph (iii), below.
(ii) Irrespective of the extent of such damage or destruction, if
the proceeds received or to be received by Landlord by reason
of such damage or destruction under any such fire and extended
coverage insurance policy or policies fire and extended
coverage insurance policy or policies required on the part of
the Landlord to be maintained hereunder are, in the judgment
of Landlord, inadequate to repair, construct or restore the
shell and structural portions of the Premises to the condition
in which the shell and structural portions of the Premises
were immediately prior to such damage or destruction (unless
Tenant elects to reimburse Landlord for such deficiency),
Landlord may elect to terminate this Lease by giving at least
fifteen (15) days written notice of its said election to
Tenant, such notice to be given within thirty (30) days after
Landlord ascertains that such proceeds are inadequate for that
purpose. If Landlord shall not so elect to terminate this
Lease, then Landlord shall repair, reconstruct or restore the
shell and structural portions of the Premises in accordance
with the provisions of subparagraph (iii), below The repair
and restoration of items not provided at Landlord's expense
shall be the obligation of Tenant. Tenant understands that
Landlord will not carry insurance of any kind of Tenant's
interior, nonstructural improvements, storefront, furniture,
furnishings, fixtures, equipment or other personal property,
and that Landlord shall not be obligated to repair any damage
thereto or replace the same.
(b) If at any time after the execution of this Lease the improvements on
the Premises or any portion thereof should be damaged or destroyed
by any casualty not required on the part of the Landlord to be
insured against hereunder, and the cost of repair exceeds one
month's Base Rent, then Landlord may, but shall have no obligations
to, elect and repair, reconstruct or restore the Premises after any
such damage or destruction thereto by giving at least fifteen (15)
day; written notice of its said election to Tenant. such notice to
be given within thirty (30) days after the date of such damage or
destruction if Landlord elects to repair, reconstruct or restore the
Premises after such damage or destruction thereto, or if the cost of
repair is less than one month's Base Rent, or if Tenant shall,
within fifteen (15) days after the date of the casualty, deliver
written notice to Landlord that ▇▇▇▇▇▇ agrees to pay in advance all
funds necessary for the repair of the damaged improvements this
Lease shall continue in full force and effect (except as otherwise
herein provided) and Landlord shall promptly commence and with due
diligence complete the repair, reconstruction or restoration of the
Premises so far as practicable to the condition to which the
Premises were immediately prior to such damage or destruction. If
Landlord fails to make such election, then this Lease shall be
deemed terminated as of the date of such damage or destruction, and
all amounts paid or payable by Tenant to Landlord shall, where
applicable, be prorated between Landlord and Tenant.
(c) In the event Landlord elects or is required hereunder to repair,
reconstruct, or restore the shell and structural portions of the
Premises after any damage of destruction thereto, Tenant shall, at
its own expense, as soon as reasonably practicable replace or fully
repair, reconstruct or restore its interior leasehold improvements,
exterior signs, storefront,
23
merchandise and ▇▇▇▇▇▇'s Property Landlord's obligation under this
Section 25 shall, however, in no event exceed the scope of the work
that was done by Landlord in the original construction and
improvement of the Premises, nor shall Landlord be required to
expend sums therefor in excess of such damage or destruction. Tenant
shall have no interest in or claim to any portion of the proceeds of
any insurance maintained by Landlord hereunder.
(d) ▇▇▇▇▇▇ agrees at all times after any damage to or destruction of the
improvements on the Premises, or any portion thereof, to continue
the operation of its business therein to the extent practicable from
the standpoint of good business, and in the event Landlord is
required or elects to make any repairs, reconstruction or
restoration of any damage or destruction to the Premises under any
of the provisions of the Section 25, Tenant shall not be entitled to
any damages by reason of inconvenience or loss sustained by Tenant
as a result thereof. Unless the damage or destruction is caused by
the negligence of Tenant, or ifs employees or agents, during the
period commencing with the date of any such damage or destruction
which Landlord is required or elects hereunder to repair,
reconstruct or restore, and ending with the completion of such
repairs, reconstruction or restoration, or through the date of
termination of this Lease, as the case may be, the Base Rent shall
be proportionately abated in an amount equal to the proportion
thereof which the number of square feet of gross floor area in the
Premises rendered untenantable thereby bears to the total number of
square feet of gross floor area in the Premises immediately prior to
such damage or destruction. The full amount of said Base Rent and
all other charges shall again become payable immediately upon the
completion of such work of repair, reconstruction or restoration.
Except as expressly hereinabove any rental or other charge payable
on the part of Tenant to Landlord hereunder, or in the method of
computing, accounting for or paying the same.
(e) Notwithstanding any destruction or damage to the Premises or the
Shopping Center, Tenant shall not be released from any of its
obligations under this Lease except to the extent and upon the
conditions expressly stated in this Section 25. Notwithstanding
anything to the contrary contained in this Section 25, should
Landlord be delayed or prevented from repairing or restoring said
damaged Premises for one (1) year after the occurrence of such
damage or destruction by reason of acts of God, war, governmental
restrictions, inability to procure the necessary labor or materials,
or other cause beyond the control of Landlord, the Landlord and the
Tenant shall each have the right to terminate this Lease, effective
upon thirty (30) days poor written notice, so long as said damaged
Premises shall still have not substantially been repaired or
restored.
(f) Notwithstanding anything provided herein to the contrary, if the
Shopping Center or any part thereof (not necessarily including the
Premises) is damaged or destroyed by casualty (insured or uninsured)
to the extent that the cost of restoring the damaged portions
exceeds fifteen percent (15%) of the replacement cost of all
"Landlord Improvements" comprising the Shopping Center, Landlord may
elect to terminate this Lease by giving at least fifteen (15) days
notice of its said election to Tenant, such notice to be given
within thirty (30) days after the date of such damage or
destruction. For the purposes hereof, "Landlord improvements" shall
mean any and all improvements comprising the Shopping Center, other
than interior, nonstructural improvements furnished by tenants of
the Shopping Center.
(g) In the event this Lease is terminated under any of the provisions of
this Article 25, such termination shall become effective at the time
and in accordance with the respective
24
provisions herein contained for the termination of this Lease;
provided, however, that all tenants and other charged on the part of
Tenant to be paid hereunder shall be prorated and paid either as of
the date of such damage or destruction, or as of the date Tenant
ceases doing business in, upon or from the Premises, whichever last
occurs
(h) Tenant hereby waives the provisions of Section 1932(s) and Section
1933(4) of the California Civil code or any other law which may
hereafter be in force during the term of this Lease which authorizes
the termination of the Lease upon the partial or complete
destruction of the Premises.
26. EMINENT DOMAIN
If more that twenty-five percent (25%) of the Premises shall be taken or
appropriated by any public or quasi-public authority under the power of
eminent domain, either party hereto shall have the right, at its option,
within sixty (60) days after said taking, to terminate this Lease upon
thirty (30) days written notice. If more than twenty-five percent (25%) of
the Premises are taken and neither party elects to terminate as herein
provided, or if less than twenty-five percent (25%) of the Premises are
taken, the Lease shall continue but the Base Rent thereafter to be paid
shall be equitably reduced. If more than fifteen percent (15%) of the
Shopping Center, the common and parking areas, or the building of which
the Premises are a part may be so taken or appropriated, Landlord shall
within sixty (60) days of said taking have the right, at its option, to
terminate this Lease upon written notice to Tenant. In the event of any
taking or appropriation whatsoever, Landlord shall be entitled to any and
all awards and/or settlements which may be given (except for any
separately stated award for Tenant's personal property, goodwill or moving
expenses), and Tenant shall have no claim against Landlord for the value
of any unexpired term of this Lease
27. SIGNS
Tenant shall not affix or maintain any signs upon the Premises or the
building in which the Premises are located, except in accordance with the
sign criteria established by Landlord. Tenant shall erect one sign on the
front of the Premises, not later than the date Tenant opens for business,
in accordance with the sign criteria promulgated by Landlord Furthermore,
all signs to be installed by Tenant shall conform to the style of the
other signs in the Shopping Center, and shall conform to applicable local
government codes.
28. DISPLAYS
The Tenant may not display or sell merchandise or allow grocery carts or
other similar devices within the control of Tenant to be stored or to
remain outside the defined exterior walls and permanent doorways of the
Premises. Tenant further agrees not to install any exterior lighting,
amplifiers or similar devices, or use in or about the Premises any
advertising medium which may be heard or seen outside the Premises, such
as flashing lights, searchlights, loudspeakers, phonographs or radio
broadcasts.
29. AUCTIONS
Tenant shall not conduct or permit to be conducted any sale by auction in,
upon or from the Premises whether said auction be voluntary, involuntary,
pursuant to any assignment for the payment of creditor; or pursuant to any
bankruptcy or other insolvency proceeding.
25
30. SURRENDER OF PREMISES
Upon the expiration or sooner termination of the term of this Lease (and
whenever reference is made to the term of this Lease or the term hereof,
such reference shall include any extension or renewal of the term of this
Lease), if Tenant has fully and faithfully performed all of the terms,
conditions and covenants of this Lease to be performed by Tenant, but not
otherwise, Tenant shall, at its sole costs and expense, remove from the
Premises its interior and exterior signs and all of its moveable trade
fixtures and equipment, ▇▇▇▇▇▇'s Property, and such other items Tenant has
installed or placed on the Premises, and Tenant shall repair all damage
thereto resulting from such removal. Tenant shall thereupon surrender the
Premises, broom clean, in good condition and repair, reasonable wear and
tear (including damage thereto which Tenant is not required to repair)
excepted. If ▇▇▇▇▇▇ has not fully and faithfully performed all of the
terms, conditions and covenants of this Lease to be performed by ▇▇▇▇▇▇,
Tenant shall nevertheless remove Tenant's Property from the Premises in
the manner aforesaid within fifteen (15) days after receipt of written
direction to do so from Landlord. Notwithstanding the foregoing, Tenant
shall remove the floor coverings in the Premises only if directed to do so
by Landlord in which event it shall do so, and shall repair all damage to
the Premises resulting from such removal. In the event Tenant shall fail
to remove any of Tenant's Property or floor coverings as provided herein,
Landlord may, but is not obligated to, at Tenant's expense and with
interest, remove all Tenant's Property and floor coverings not so removed
and repair all damage to the Premises resulting from such removal and may,
but is not obligated to, at Tenant's expense, store the same in any public
or private warehouse, and Landlord shall have no liability to Tenant for
any loss or damage to Tenant's Property or floor coverings caused by or
resulting from such removal or otherwise.
31. RELOCATION
During the term, Landlord shall have the right, at any time, upon at least
thirty (30) days prior written notice to Tenant, to relocate the Tenant to
other space in the Shopping Center, which new space shall have at least
ninety-five percent (95%) of the square footage set forth in Section 1(g)
hereof. Notwithstanding the foregoing, should the term have less than one
(1) year remaining as of the effective date of relocation set forth in
said notice, and should Landlord and Tenant be unable after a good faith
effort to reach agreement on the terms of a renewal or extension of this
Lease, Tenant shall have the option to terminate this Lease as of the
effective date of relocation, provided such notice is given in writing to
Landlord within thirty (30) days after the date of Landlord's notice.
Absent such termination, Tenant shall, not later than the date specified
in Landlord's notice, vacate and surrender the Premises, relocate to the
new premises, and prepare the new premises for occupancy in substantially
the same manner and condition of the Premises. Upon the request of
Landlord, Tenant shall execute a supplemental agreement specifying the
location of the new premises and the new Base Rent to be payable pursuant
to this Lease. The "Base Rent, "property tax costs and "operating costs"
payable under this Lease shall be the same on a "per square foot" basis,
except that they shall be adjusted based upon the differential, if any, in
the size of the old Premises and the new premises. Landlord shall
reimburse Tenant for the actual expenses of moving Tenant's trade fixtures
and merchandise from the Premises to the new space, upon written receipt
of written verification of payment by ▇▇▇▇▇▇. Except as hereinafter
provided, all other expenses incurred by ▇▇▇▇▇▇ as a consequence of such
move shall be absorbed by Tenant. Within thirty (30) days after the date
Tenant shall have completed renovation of the new premises and opened for
business. Landlord shall reimburse Tenant for the unamortized cost of the
leasehold improvements made by Tenant to the old Premises, based upon cost
or costs as set forth in an affidavit to be submitted to Landlord,
assuming a useful life of 10 years, and accelerated amortization at the
rate of 150%, and subject to Landlord's inspection of Tenant's books as
set forth below. In the event Tenant shall have amortized the cost of said
improvements
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(or any parts or components thereof) for tax purposes based on either a
shorter useful life or at a more accelerated rate, then such life or rate
shall prevail. Landlord shall not be required to reimburse Tenant for any
fixtures, inventory or items of personal property which pursuant to the
terms of this Lease may be removed by Tenant al the end of the term.
Landlord shall have the right to inspect such of ▇▇▇▇▇▇'s books and
records as Landlord may reasonably request in order to verify the amount
which Landlord is required to pay pursuant to this Section.
32. sale of the Premises by LAndlorD; ECULPATION
In the event of any sale of the Premises by Landlord, Landlord shall be
and is hereby entirely freed and relieved of all liability under any and
all of its covenants and obligations contained in or derived from this
Lease arising out of any ad, occurrence or omission occurring after the
consummation of such sale; and the purchaser, at such sale or subsequent
sale of the Premises shall be deemed, without any further agreement
between the parties and any such purchaser, to have assumed and agreed to
carry out any and all of the covenants and obligations of the Landlord
under this Lease, and ▇▇▇▇▇▇ agrees to attorn to Land lord's
successor(s)-in-interest. Tenant agrees to look solely to ▇▇▇▇▇▇▇▇'s
interest in the Premises and the real property of which it is a part (or
the proceeds thereof) for the satisfaction of any remedy of Tenant, for
the collection of a judgment (or other judicial process) requiring the
payment of money by Landlord in the event of default by Landlord
hereunder, and no other property or assets of Landlord shall be subject to
levy, execution, or other enforcement procedure for the satisfaction of
Tenant's remedies under or with respect to this Lease, the relationship of
Landlord and Tenant hereunder, or ▇▇▇▇▇▇'s use or occupancy of the
Premises.
33. SUBORDINATION
▇▇▇▇▇▇ agrees upon request of Landlord to subordinate this Lease and its
rights hereunder to the lien of any mortgage, deed of trust or other
encumbrance, together with any conditions, renewals, extensions, or
replacements thereof, now or hereafter placed, charged or enforced against
the Landlord's interest in this Lease and the leasehold estate thereby
created, the Premises or the land, building or improvements included
therein or of which the Premises are a part, and deliver (but without the
cost to Tenant) at any time and from time to time upon demand by Landlord
such documents as may be required to effectuate such subordination, and in
the event that Tenant shall fail, neglect or refuse to execute and deliver
any such document within ten (10) days after receipt of written notice so
to do and the receipt by Tenant of the document to be executed by it,
Tenant hereby appoints Landlord, its successors and assigns, the
attorney-in-fact of Tenant irrevocably to execute and deliver any and all
such documents for and on behalf of Tenant, provided, however, that Tenant
shall not be required to effectuate such subordination, nor shall Landlord
be authorized to effect such subordination on behalf of Tenant, unless the
mortgagee or beneficiary named in such mortgage, deed of trust of other
encumbrance shall first agree in writing, for the benefit of Tenant, that
so long as Tenant is not in default under any of the provisions, covenants
or conditions of this Lease on the part of Tenant to be kept and
performed, that ▇▇▇▇▇▇'s quiet enjoyment of the Premises will not be
disturbed or interfered with, by any trustee's sale or by any action or
proceeding to foreclose said mortgage, deed of trust or other encumbrance.
In the event that the mortgage or beneficiary of any such mortgage or deed
of trust elects to have this Lease a prior lien to its mortgage or deed of
trust, then and in such event upon such mortgage or beneficiary giving
written notice to Tenant to that effect, this Lease shall be deemed prior
in lien to such mortgage or deed of trust whether this Lease is dated or
recorded prior or subsequent to the date of recordation of such mortgage
or deed of trust.
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34. TENANT'S OFFSET STATEMENTS
Tenant shall at any time and from time to time, upon rot less than ten
(10) days prior written notice from Landlord, execute, acknowledge and
deliver to Landlord a statement in writing, certifying to such matters as
Landlord may reasonably request, including (a) that this Lease is
unmodified and is in full force and effect (or, if modified, stating the
nature of such modification and certifying that this Lease as so modified
is in full force and effect), and the date to which the rental and other
charges are paid in advance, if any, and (b) acknowledging that there are
not, to Tenant's knowledge, any uncured defaults on the part or the
Landlord hereunder, or specifying such defaults if any are claimed, and
(c) setting forth the date of commencement of rents and expiration of the
term hereof. Any such statement may be relied upon a prospective purchaser
or encumbrancer of all or any portion of the Shopping Center of which the
Premises are a part.
35. AUTHORITY OF TENANT
If Tenant is a corporation or a partnership, each individual executing
this Lease on behalf of said corporation or partnership represents and
warrants that he is duly authorized to execute and deliver this Lease on
behalf of said corporation or partnership, as the case may be, in
accordance with the bylaws of Said corporation or of the articles of said
partnership, and that this Lease is binding upon said corporation or
partnership
36. BROKERS
Tenant warrants that it has had no dealings with any real estate broker or
agents in connection with the negotiation of this Lease and it knows of no
other real estate broker or agent who is entitled to a commission in
connection with this Lease.
37. Merchants' Association and marketing fund
(a) At Landlord's option, Tenant shall throughout the term or any
extension of renewal of the term of this Lease become a member of,
participate fully in, and remain in good standing in the Merchants'
Association formed for tenants occupying Premises in the Shopping
Center, and shall abide by the bylaws, ruled and regulations of such
Association. The objectives of such Association shall be to
encourage its members to deal fairly and courteously with their
customers, to sell their merchandise or services at fair prices, to
follow ethical business practices, to assist the business of the
Center by sales promotions and advertising, and in particular to
help the interests of the members of said Association. So long as
such a Merchants' Association is in existence. Tenant agrees to Pay,
as additional rent, dues to the Merchants' Association in the amount
specified in Article 1(k) hereof. The terms hereof shall be deemed
to be covenants for the benefit of And enforceable by said
Merchants' Association, as well as by said Landlord.
(b) At Landlord's option, Landlord may create a Marketing Fund, and may
require Tenant to participate in the Marketing Fund in lieu of
Tenant's participating in the Merchants' Association. The Marketing
Fund shall be operated by a professional marketing director Hired by
the Landlord for the purpose of assisting the business of the
Shopping Center. Should Landlord form a Marketing Fund, ▇▇▇▇▇▇
agrees to pay as additional rent, dues to The Marketing Fund in the
amount specified in Article 1(k) hereof, in lieu of Tenant's
contribution to the Merchants' Association.
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38. GENERAL PROVISIONS
(i) Plats and Riders
Clauses, plats, riders, exhibits, and addendum, if any,
affixed to this Lease are a part hereof.
(ii) Waiver
The waver by Landlord of any term, covenant or condition
herein contained shall not be deemed to be a waiver of such
term, covenant or condition or any subsequent breach of the
same or any other term, covenant or condition herein
contained. The subsequent acceptance of rent hereunder by
Landlord shall not be deemed to be a waiver of any preceding
default by Tenant of any term, covenant or condition of this
Lease, other than the failure of the Tenant to pay the
particular rental so accepted, regardless of Landlord's
knowledge of such preceding default at the time of the
acceptance of such rent.
(iii) Joint Obligation
If there is more than one Tenant, the obligations hereunder
imposed shall be joint and several.
(iv) Marginal Headings
The marginal headings and article titles to the articles of
this Lease are not a part of the Lease and shall have no
effect upon the construction or interpretation of any part
hereof.
(v) Time
Time is of the essence of this Lease and each and all of its
provisions in which performance is a factor.
(vi) Successors and Assigns
The covenants and conditions herein contained, subject to
the provisions as to assignment, apply to and bind the
heirs, successors, executors, administrators and assigns of
the parties hereto.
(vii) Quiet Possession
Upon Tenant paying the rent reserved hereunder and observing
and performing all of the covenants, conditions and
provisions on ▇▇▇▇▇▇'s part to he observed and performed
hereunder. Tenant shall have quiet possession of the
Premises for the entire term hereof, subject to all the
provisions of this Lease.
(viii) Interest
Any amount due from Tenant to Landlord hereunder which is
not paid when due shall bear interest at the highest rate
then allowed under the usury laws of the State of California
from the date due until paid.
(ix) Prior Agreements
This Lease contains all of the agreements of the parties
hereto with respect to any matter covered or mentioned in
this Lease, and no prior agreements or understanding
pertaining to any such matters shall be effective for any
purpose. No provisions of this Lease may be amended or added
to except by an agreement in writing signed by the parties
hereto or their respective successors in interest.
29
This Lease shall not be effective or binding on any party
until fully executed by both parties hereto.
(x) Inability to Perform
This lease and the obligations of the Tenant hereunder shall
not be affected or impaired because the Landlord is unable
to fulfill any of its obligations hereunder or is delayed in
doing so, if such inability or delay is caused by reason of
strike, labor troubles, acts of God, or any other cause
beyond the reasonable control of the Landlord.
(xi) Partial Invalidity
Any provision of this Lease 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.
(xii) Cumulative Remedies
No remedy or election hereunder shall be deemed exclusive
but shall, whenever possible, be cumulative with all other
remedies at law or in equity.
(xiii) Choice of Law
This Lease shall be governed by the laws of the State of
California.
(xiv) Attorneys' Fees
In the event of any action or proceeding brought by either
party against the other under this Lease, the prevailing
party shall be entitled to recover for the fees of its
attorneys in such action or proceeding, including costs of
appeal, if any, in such amount as the court may adjudge
reasonable as attorneys' fees. In addition, should it be
necessary for Landlord to employ legal counsel to enforce
any of the provisions herein contained, ▇▇▇▇▇▇ agrees to
reimburse Landlord for all attorneys' fees and expenses
incurred even if suit is not instituted.
(xv) Accord and Satisfaction
Payment by Tenant or receipt by Landlord of a lessor amount
than the rent or other charges herein stipulated shall be
deemed to be on account of the earliest due stipulated rent
or other charged, and no endorsement or statement on any
check or any letter accompanying any check payment as rent
or other charges shall be deemed an accord and satisfaction,
and Landlord shall accept such check or payment without
prejudice to Landlord's right to recover the balance of such
rent or other charges or pursue any other remedy in this
Lease to the Tenant.
(xvi) Financial Statements
At any time during the term of this Lease, Tenant shall,
upon ten (10) days prior written notice from Landlord,
provide Landlord with a current financial statement and
financial statements of the two (2) years prior to the
current financial statement year. Such statements shall be
prepared in accordance with generally accepted accounting
principals and, if such is the normal practice of Tenant
shall be audited by an independent certified public
accountant.
(xvii) Notices
All notices and demands which may or are to be required or
permitted to be given by either party on the other hereunder
shall be in writing. All notices and
30
demands by the Landlord to the Tenant shall be sent by
certified mail, postage prepaid, addressed to the Tenant of
the Premises, and to the address set forth in Section 1(l)
hereof, or to such other place as Tenant may from time to
time designate in a written notice to Tenant.
To Landlord at: Eureka Square Shopping Center
Property Management Office
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(xviii) Covenants by Tenant
This Lease is subject to the terms, covenants and conditions
herein set forth, and The Tenant covenants, as a material
part of the consideration for this Lease, to Keep and
perform each and all of said terms, covenants and conditions
on its part to be kept and performed.
IN WITNESS WHEREOF, the parties hereto have entered into this Agreement as of
the day and year first above written.
("Landlord")
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇
("Tenant")
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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ADDENDUM
5-YEAR OPTION
RENT FOR THE FIRST 5-YEAR OPTION ON THE LEASE DATED 24 APRIL 1995 BETWEEN FIRST
NATIONAL BANK OF ▇▇▇▇ CITY AND EUREKA SQUARE SHOPPING CENTER LP. FOR SPACE ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ IS AS FOLLOWS:
YR 1 JANUARY 1, 2000 TO DECEMBER 31, 2000 $3900
YR 2 JANUARY 1, 2001 TO DECEMBER 31, 2001 $4000
YR 3 JANUARY 1, 2002 TO DECEMBER 31, 2002 $4100
YR 4 JANUARY 1, 2003 TO DECEMBER 31, 2003 $4200
YR 5 JANUARY 1, 2004 TO DECEMBER 31, 2004 $4300
COMMON AREA MAINTENANCE WILL BE COLLECTED IN ADDITION TO THE RENT EACH MONTH.
CAM COSTS ARE $240 PER MONTH FOR THE YEAR 2000. THIS WILL BE ADJUSTED AT THE
BEGINNING OF EACH ONE-YEAR PERIOD.
("TENANT") ("LANDLORD")
/s/ ▇.▇. ▇▇▇▇▇ /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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▇.▇. ▇▇▇▇▇ Eureka Square Shopping Center L.P.
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Title Title
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇ ▇▇▇▇▇ Date
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Title
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Date