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Item No. 06 Addendum No. 3 Comm Lease Agrment
City Council Agenda Report City of Lake Elsinore 130 South Main Street Lake Elsinore, CA 92530 www.lake-elsinore.org File Number: ID# 19-068 Agenda Date: 3/26/2019 Status: PassedVersion: 1 File Type: Council Consent Calendar In Control: City Council / Successor Agency Agenda Number: 6) Addendum No. 3 to Commercial Lease Agreement Authorize the City Manager to execute Addendum No. 3 to Commercial Lease Agreement for premises located at 114 S. Main Street in such final form as approved by the City Attorney. Page 1 City of Lake Elsinore Printed on 5/17/2023 REPORT TO CITY COUNCIL To:Honorable Mayorand Members of the City Council From:Grant Yates, City Manager Prepared By: Jason Simpson, Assistant City Manager Date:March26, 2019 Subject:AddendumNo. 3 to Commercial Lease Agreement Recommendation Authorize the City Manager to execute Addendum No. 3 to Commercial Lease Agreement for premises located at 114 S. Main Street in such final form as approved by the City Attorney. Background The City currently leases the premisesat114 S. Main Street. This building provides office space for the City’s Conference Room B, Information Technology Division, and the Fire Marshal. The City entered into the original Commercial Lease and Addendum No. 1on December 18, 2006 for a five (5) year term, with an initial rent of $1,780 per monthsubject to annual adjustments. The City extended the Commercial Lease by Addendum No. 2in January 2013 for an additional five (5) year termwith an initial rent of $2,000 subject to annual Consumer Price Index (CPI) adjustments. Thereafter, the Commercial Lease continued on a month to month basis. Discussion City staff desires to extend the term of the Commercial Lease at 114 S. Main Street, for an additional three(3) year termcommencing April 1, 2019. The initial rent will equal $2,250.00per month and increase annually by $100.00 each April 1. All other terms of the Commercial Lease as amended by Addendum No. 2 shall remain in effect, except that the non-major repairs limit is $2,500 andthe City has first right of refusal should the Lessor entertain the idea of selling the property. Fiscal Impact Approval of this Commercial Lease will commit the Citybeginning April 1, 2019 to rent payments of $2,250.00per month plus annual increases of $100.00 for the term of the lease. This expense is budgeted for in the FY18-19operating budget. Exhibits A -Addendum No. 3 to CommercialLease B -Addendum No. 2, Addendum No. 1 &Original Agreement Lessor Initials: Page 1 Lessee Initials: ADDENDUM NO. 3TO COMMERCIAL LEASE Genaro and Mabel A. Prats 114 South Main Street, Lake Elsinore, CA 92530 This Addendum No. 3 to Commercial Lease (“AddendumNo. 3”) ismade and entered into as ofApril1, 2019by and between the City of Lake Elsinore,a municipal corporation(“Lessee), andGenaro and Mabel A. Prats(“Lessor”). RECITALS A.The Lessee and Lessorentered into that certain Commercial Lease and Addendum No. 1 thereto dated December 18, 2006 for the lease of 114 South Main Street(APN 373-151-021) (the “Original Agreement”). B.The term of the Original Agreement was for five(5) years, commencing on December 18, 2006 and ending December 17, 2012.The Original Agreement provided formonthly rent of $1,780 calculated at the rate of $1.25 per rentable square footfor the first two (2) years of the LeaseTermsubject to specified adjustments thereafter. C.AddendumNo. 2 extended the term of the Original Agreement, for an additional five (5) year term, commencing January 1, 2013 and ending December 31, 2017with monthly rent commencing at $2,000 subject to annual adjustments based on Consumer Price Index (CPI) percentage change as reported by the Bureau of Labor Statistics for the Los Angeles-Riverside-Orange County Area. Addendum No.2 replaced and superseded Addendum No. 1. D.The lease has been on a month to month arrangement since December 31, 2017. E.The parties now desireto extend the term of theCommercial Leasean additional three (3) year term, commencing April1, 2019and ending March31, 2022. Except as otherwise defined herein, all capitalized terms used herein shall have the meanings set forth for such terms in the Commercial Lease as amended by Addendum No. 2. NOW, THEREFORE, in consideration of the mutual covenants and conditions set forth herein, Lessee and Lessoragree as follows: 1.Addendum to Section 3, Term, is hereby amendedin its entirety as follows: The Term of that certain Commercial Lease dated as of December 18, 2006 by and between Genaro and Mabel A. Prats and the City of Lake Elsinore (the “Lease”)shall be extended such that the new term of the Lease shall bethree(3) years, commencing on April1, 2019and ending December 31, 2022, unless terminated earlier as hereinafter provided. At the conclusion of the Lease (as extended as provided herein), the Lessor and the Lessee, at their option, can continue this agreement as a month to month Lease agreement, based upon the written agreement of the parties. Lessor Initials: Page 2 Lessee Initials: In the event that Lessor, in their sole discretion, elects to sell the Premisesany time during the Term or any extension thereof, Lessor grants to Lessee the first right of refusal to purchase the Premises at the agreed upon purchase price and terms set forth in a bona fide offer to purchase. Lessee shall have thirty (30) days following written notice from Lessee of such bona fide offer to notify Lessor of its election to purchase the Premises pursuantto such first right of refusal. 2.Addendum to Section 4, Rent, is hereby amended and restated in its entirety as follows: Lessee shall pay monthly rent to Lessor in the amount of Two Thousand TwoHundred FiftyDollarsand NoCents($2,250.00)commencing April 1, 2019. Each April1, thereafter during the Term,the monthly rent paid to Lessor shall increase $100.00 bringing the monthly rent commencing April 1, 2020 to Two Thousand Three Hundred Fifty Dollars and No Cents ($2,350.00)and to Two Thousand Four Hundred Fifty Dollars and No Cents ($2,450.00)per month commencing April 1, 2021. Each rent payment shall be due in advance on the first day of each calendar month during the Term and shall be delinquent on the tenth of the month. If any installment of rent due from Lessee is not received by Lessor within ten days of due date, Lessee shall pay Lessor a One Hundred Dollars ($100.00) late fee. Rent payments shall be made to Lessor at such place designated by written notice from Lessor. 3.Addendum to Section 10, Repairs and Maintenance, the first sentence of the second paragraph is hereby amended and restated in its entirety as follows: Lessee shall be responsible, at Lessee expense, for non-major repairs (less than $2,500) necessary to maintain and repair non-major systems and interior improvements. 4.Except for the changes specifically set forth herein, all other terms and conditions of the Commercial Lease as amended by Addendum No. 2 shall remain in full force and effect. Lessor Initials: Page 3 Lessee Initials: IN WITNESS WHEREOF,the parties have caused this AddendumNo. 3to be executed on the respective dates set forth below. “LESSOR” CITY OF LAKE ELSINORE, a municipal corporation Grant Yates, City Manager Date: ATTEST: City Clerk APPROVED AS TO FORM: City Attorney “LESSOR” Genaro and Mabel A. Pratts Genaro Pratts–Owner Date:_________________________ ______________________________ Mabel A. Pratts –Co Owner Date: ADDENDUM NO. 2 TO COMMERCIAL LEASE Addendum to Section 3 —Term The Term of that certain Commercial Lease dated as of December 18, 2006 by and between Genaro and Mabel A. Prats and the City of Lake Elsinore (the "Lease") shall be extended such that the new term of the Lease shall be five (5) years, commencing on the 1 st day of January, 2013 and ending on the 31st day of December, 2017, unless terminated earlier as hereinafter provided. At the conclusion of the Lease (as extended as provided herein), the Lessor and the Lessee, at their option, can continue this agreement as a month to month Lease agreement, based upon the written agreement of the parties. Addendum to Section 4 - Rent Lessee shall pay monthly rent to Lessor in the amount of Two Thousand Dollars ($2,000.00) calculated at the rate of $1.40 per rentable square foot. Commencing January 1, 2014 and each January 1st thereafter during the Term, the monthly rent paid to Lessor shall be subject to an annual increase commencing on January 1 of each year during the Term, such annual increase to be based on the Consumer Price Index (CPI) percentage change as reported by the Bureau of Labor Statistics for the Los Angeles-Riverside-Orange County Area for the period of September to September each year. Each rent payment shall be due in advance on the first day of each calendar month during the Term and shall be delinquent on the tenth of the month. If any installment of rent due from Lessee is not received by Lessor within ten days of the due date, Lessee shall pay Lessor a One Hundred Dollars ($100.00) late fee. Rent payments shall be made to Lessor at Murrieta, California 92562 or at such other place designated by written notice from Lessor. Addendum to Section 8 —Assianment and Sublettiti� Lessee shall have the right without Lessor's consent, to assign this Lease to any subsidiary of Lessee. Except as set forth above, Lessee shall not sublease all or any part of the Premises, or assign this Lease in whole or in part without Lessor's consent, such consent not to be unreasonably withheld or delayed. Lessor Initials: /17 �1 1 Lessee Initials _ Addendum to Section 10 -Rel2airs and Maintenance During the Term, Lessor shall maintain the roof, foundation, exterior walls and the major building systems, including heating, air conditioning, electrical, plumbing and water systems. Lessee shall be responsible, at Lessee expense, for non-major repairs (less than $1,000.00) necessary to maintain and repair non-major systems and interior improvements. In addition, Lessee will keep back gutter area of Premises clear of debris to avoid flooding into the building. Lessee will assist and cooperate with Lessor, at no expense to Lessee, to process and approve the following improvements in accordance with the requirements of the Lake Elsinore Municipal Code: (i) fencing and gating of back lot area of the Premises, (ii) lowering of curb in back alley for access to the back of the Premises, and (iii) separate electrical meter between the garage and the Premises. Addendum to Section 16—Alterations and Additions Lessee, at Lessee's expense, shall have the right following Lessor's consent to remodel, redecorate, and make additions, improvements and replacements of and to all or any part of the Premises from time to time as Lessee may deem desirable, provided the same are made in a workmanlike manner and utilizing good quality materials. Lessee shall have the right to place and install personal property, trade fixtures, equipment and other temporary installations in and upon the Premises, and fasten the same to the premises. All personal property, equipment, machinery, trade fixtures and temporary installations, whether acquired by Lessee upon the Commencement date or placed or installed on the Premises by Lessee thereafter, shall remain Lessee's property free and clear of any claim by Lessor. Lessee shall have the right to remove the same at any time during the Term provided that all damage to the Premises caused by such removal shall be repaired by Lessee at Lessee's expense. Adde]ICIUM to Section tg A —Fire & Property Insurance Lessor shall maintain fire and extended coverage insurance on the Premises in such amounts as Lessor shall deem appropriate. Lessee shall be responsible, at its expense, for fire and extended coverage insurance on all of its personal property, including removable trade fixtures, located in the Premises. Addendum to Section 18(B)— Liability Insurance Lessee and Lessor shall, each at its own expense, maintain a policy or policies of comprehensive general liability insurance with respect to the respective activities of each on the Premises with the premiums thereon fully paid on or before due date, issued by and binding upon some insurance company approved by Lessor, such insurance to afford minimum protection of not less than $1,000,000 combined single limit coverage of bodily injury, property damage or combination thereof. Lessor shall not be required to maintain Lessor Initials: /�. P. G7� 2 Lessee Initials: 4q) insurance against thefts within the Premises. Lessee shall provide Lessor with current certificates of insurance evidencing Lessee's compliance with this paragraph. Lessee shall cause Lessor to be named as an additional insured on Lessee's policy Addendumi adding Section 18(E-)—Hold Harmless (LESSOR) LESSOR shall indemnify and hold LESSEE harmless from and against any and all claims arising from LESSOR'S use or occupancy of the parking area within the Premises or from the conduct of its business or from any activity, work, or things which may be permitted or suffered by LESSOR in or about within the parking area within the Premises including all damage, costs, attorney's fees, expenses and liabilities incurred in the defense of any claim or action or proceeding arising there from. Except for LESSEE'S willful or grossly negligent conduct, LESSOR hereby assumes all risk of damage to property or injury to person in or about the parking area within the Premises used by LESSOR from any cause, and LESSOR hereby waives all claims in respect thereof against LESSEE. Addendum to Sectioti 26 - Parkin Lessee shall have the exclusive use of the automobile parking areas, driveways, and footways on the Premises (except for such fenced area as may be installed by Lessor). Lessor may park his RV in the automobile parking area of the Premises when visiting the garage; provided, however, that such parking shall be permitted only during Lessor's visit to the garage on the Premises and no longer than permitted by applicable provisions of the Lake Elsinore Municipal Code. Addendum to Section 29 -Notices Notice to Lessor shall be at the addresses as set forth below: Murrieta, CA 92562 With a copy to: Lake Forest, CA 92630 Addendum No. 1 Lessor Initials: l 3 Lessee Initials: Beginning January 1, 2013, this Addendum No. 2 shall replace and supersede that certain Addendum No. 1 to that certain Commercial Lease dated as of December 18, 2006 by and between Genaro and Mabel A. Prats and the City of Lake Elsinore (the "Lease"). Lessor Initials: 4 Lessee Initials: ADDENDUM NO. 1 TO COMMERCIAL LEASE Addendum to Section 4-Rent Lessee shall pay monthly rent to Lessor in the amount of$1,780.00 calculated at the rate of $1.25 per remable square foot during the first two (2) years of the Lease. Commencing in year 3 on the twenty-fifth (25`n) month of the Term, Lessee shall pay monthly rent to Lessor in the amount of$1,865.44 calculated at the rate of$1,31 per rentable,square foot and subject to an annual increase commencing in year 4 and continuing until the expiration of the Term equal to the Consumer Price Index (CPI) percentage change as reported by the Bureau of Labor Statistics for the I.,os Angeles-Riverside-Orange County Area for the period of September to September each year. The first month's rent shall be prorated on a daily basis for the period commencing on December 18, 2006 through December 31, 2006. Thereafter each rent payment shall be due in advance on the first day of each calendar month during the Term and shall be delinquent on the tenth. The last month's rent for a partial calendar month shall also be prorated on a daily basis, If any installment of rent due from Lessee is not received by landlord within ten days of the due date, Lessee shall pay Lessor a One Hundred Dollar($100) late fee. Rent payments shall be made to Lessor at California 92630 or at such other place designated by written notice from Lessor. Addendum to Section 8 —Assignment and Sublettin, Lessee shall have the right without Lessor's consent, to assign this Lease to any subsidiary of Lessee. Except as set forth above, Lessee shall not sublease all or any part of the Premises, or assign this Lease in whole or in part without Lessor's consent, such consent not to be unreasonably withheld or delayed. Addendum to Section 10 - Re airs and Maintenance During the Term, Lessor shall maintain the roof, foundation, exterior walls and the major building systems, including heating, air conditioning, electrical,plumbing and water systems. Lessee shall be responsible, at Lessee expense, for non-major repairs (less than $1,000.00) necessary to maintain and repair non-major systems and interior improvements. In addition, Lessee will keep back gutter area of Premises clear of debris to avoid flooding into the building. Lessee will assist and cooperate with Lessor, at no expense to Lessee, to process and approve the following improvements in accordance with the requirements of the Lake Elsinore Municipal Code: (i) fencing and gating of back lot area of the Premises, (ii) Iowering of curb -7cam' i in back alley for access to the back of the Premises, and (iii) separate electrical meter between the garage and the Premises. Addendum to Section 15 —Alterations and Additions Lessee, at Lessee's expense, shall have the night following Lessor's consent to remodel, redecorate, and make additions, improvements and replacements of and to all or any pact of the Premises from time to time as Lessee may dean desirable, provided the same are made in a workmanlike manner and utilizing good quality materials. Lessee shall have the right to place and install personal property, trade fixtures, equipment and other temporary installations in and upon the Pr•efnises, and fasten the same to the premises. All personal property, equipment, machinery, trade fixtures and temporary installations, whether acquired by Lessee upon the Commencement date or placed or installed on the Premises by Lessee thereafter, shall remain Lessee's property free and clear of any claim by Lessor. Lessee shall have the right to remove the same at any time during the Term provided that all damage to the Premises caused by such removal shall be repaired by I,essee at Lessee's expense. Addendum to Section 18(A) —fire &Pro ert Insurance l..essor Shall maintain ire and extended coverage Insurance oil the Promises in such amounts as Lessor shall dee:rn appropriate. Lessee sliall be responsible, at its expense, for fire and extended coverage insurance on all of its personal property, including removable trade fixtures, located in the Premises. Addendum to Section.13(D)— Liability Insurance Lessee and Lessor shall, each at its own expense, maintain a policy or policies of comprehensive general liability insurance with respect to the respective activities of each on the Premises with the premiums thereon fully paid on or before due (late, issued by and binding upon some insurance company approved by Lessor, such insurance to afford minimum protection of not less than $1,000,000 combined single limit coverage of bodily injury, property damage or combination thereof. Lessor shall not be required to maintain insurance against thefts within the Premises. Lessee shall provided Lessor with current certificates of insurance evidencing Lessee's compliance with this paragraph. Lessee shall cause Lessor to be named as an additional insured.on Lessee's policy. Addendum adding Section 1$ E --Hold Harmless (LESSOR LESSOR shall indemnify and hold LESSEE harmless from and against any and all claims arising from LESSOR'S use or occupancy of the parking area within the Premises or from the conduct of its business or from any activity, work, or things which may be permitted or suffered by LESSOR in or about within the parking area within the Premises including all damage, costs, attorney's fees, expenses and liabilities incurred in the defense of any claim or action or proceeding arising there from. Except for LESSEE'S willful or grossly negligent conduct, LESSOR hereby assurnes all risk of damage to property or injury to person in or 2 f Ar about the parking area within the prG2Trises used by LESSOR from any cause, and LESSOR hereby waives all claims in respect thereof against LESSEE. Addendum to Sectio«26- Parkin Lessee shall have the exclusive use rfcr cedharea as maylbist parking d by Lessor),driveways, and footways on the P remises(except for s Lessor may park his RV i« tho automobile pal.king area of the Prerrliscs when visiting; the garage; provided, however, that such parking shall be permitted only during Lessor's visit to the garage on the pycrnises and no lollger than permitted by applicable provisions of the Lake Elsinore Municipal Code. 3 ' 00 122.16 ;T Ty COMMERCIAL LEASE This Lease iu Made and entered into this___l kLt_hdoyo( December _2006 L__ ky and bovvaan (honeinahor referred N as LESSOR) and City of Lake Elsinore (he voinukor/o(oroog to as LE3SGE), 2. LESSOR hereby |oaoos to LESSEE and LESSEE hereby |ouaoa from LESSOR, with the terms and conditions hominuho, u^, forth, |hat uonoin mo| property and the building and ommrimpmvomanto located mnvoon situated in the Ci|yof .�oun�yo( Stale of_.California and described cis !o||nwu: _ - Tho form m this Lease shall bmOmun/h'to+nonth (o4for_ c V] mon\ho ��yoan�. commencing on tho day o( Dec mbe 2}O7 and ending onmo_]jtU___day n(,_����0b§r .._�0l� . un|ono terminated earlier as hereinafter provided. At the 000v|uyimln[ this Leo,o We LESSOR and LESSEE, at their option, can oonhnxn mio ag,eomrol as a month m month L0000 oronmrinto n new|.emao ogreemem, based upon the written mUmn*vm of the parties, LESSE.E shall pay NL.ESSORmntin the amount of See Addendum No. 1 Dollars per year, payable in advance in monthly installments o( Dollars,on the day in each ov|ondn' month. The first monthly paymeot, at the oommonuomont of U`o |euva \orm, shall be mudo up on LESSEE'S execution of this |eauo. The moty| payment amount for any partial ov|ondu, months included in the lease \onn nho|| be prorated ooa daily basis. All payments shall be made ioLES80Rorayenio1 -__-_-_--__-_--�-- --_-_-___-_ A |omfeoinih*amoun\o| ______________-($ doUuno ohu|| be aouoauod U payment is not postmarked or received by LESSOR on or before the .._day after the date tho rent is due. O |'ESSEE shall supply\oLESS08a teller ofcredit. O LERSEEuhaU open mUoivicatov( Deposit uoa security deposit.A copy of which shall bo given mLESSOR. OLE8SEE shall deposit with LESSOR upon the exovuUonn[this Lease the sum o/ ed dollars uom Rool'uodab|o [/ nonrefundable security deposit. O L�SSEF, shall deposit with LESSOR upon the execution o( this Lease the sum of (� dollars as prepaid rent. LESSEE shall not be onUnw1 to interest on this prepaid mm. LESSOR ahwU have the hUh( N cornmioy|o said prepaid rent with other funds in a separate account specifically designed for this opooif|o um*, LESSOR has to mWm this deposit to LESSEE within k/urhoon (14} days after the expino|ion of the form of (Na Loaoo, or after LESSEE has vacated the Pmm|oeo, whichever is later. Unless LESSOR ' has bona fide reasons to deduct for repairs,in which case the balance has to be returned within thirty(30)days. 7V7—wri�771—., our resellefs and agents make no representations or &2004 WOLGOVS FORMS,NG, warranty, Pxpross or implied, as to 11)o fitness of this form for any spocific use or purpose. 11 you have any question, it is atways best to consult a qualified allornoy before using this or any logol document. 11111111111111111111111 1���� 7 67775 00973 6 --- Contract/Agreement No. 1967 --- LL:.SSI_! shall use the premises primarily for City _.!^snnnel and related City Hall business _ or for a business of similar characteristic and for no other purpose without LESSOITS prior written consent. Premises .1 can r:0 can not be used as a residence. (I yes, please verify all relevarit zoning, health and safety issues) LESSEE hereby accepts the Premises in their condition existing as of the date that LESSEE possesses the Premise, subject to all applicobla zoning, municipal, ccrunly, State;, and Federal laws;, ordinances, mgulations governing or ragulating the uzol of the Premises and arcepls the Lease subject thereto and to all matters disclosed Wereby. LE82SEE hereby acknowledges !fiat nuitlzer the LESSOfi nor the LESSEE'S agent has inane ally representallorl or warranty to LESSEE as to the suitability of Ilre Premises to conduct LESSEE'S business. 7 U_HUTiE:S: MIA:_:SSE shall make arrangements and pay for all water, gas, heal, light, power, telephone, and other utility services (except (or T _ _____ _ _ �_) supplied to the Premises logelher with any !axes thereon and lot, all connection charges, II any such services are not separately metered to LESSEE, the LESSEE shall pay a reasonable proportion, to be determined by I_rSS0n, of all charges jointly metered with or otherwise provided to other Premises. 8, AgSIGNP I7wr AN UBl.r-7TNG: ~LESSIiE ;:hall trot vofunlar'ily or by operalion of law assign, transfer, sublet, mortgage, or otherwise transfer or ericumber any part or all of LESSEE'S interest in this Lease or in the Premises without t_ESSORTS prior written consent. Any attempted assignment, transfer, mortgage, encumbrance or subletting without such consent shall be void and shall constitute a breach of this Lease, l'he only exception allowed to the above is that LESSEE shall have the right without L.f=SSOR'S consent, to assign Ihrs lease to a business with which [,FSSEE may merge or consolidate, to any subsidiary of L.ESSCI_, to any corpoialion under comnion control with LESSEE:, or to a purchaser of substantially all of LESSEE'S assets, Regardless of LIESSOR'S consent, no subletting or assignment shall release LESSEE or LLSSCU'S obligation to pay 0w, rent and to perform all other obfigallons io be performed by LESSEE hereunder for the term of this lease. The acceptance of rent by LESSOR from any other porson shall not be deemod a waiver by LESSOR of any provision hereof. Consent to one assignment or subletting shall not be deemed consent to any subsequent assignment or sublotting. U. SIGNS: Following L.l'SSOR'S written consent, LESSEE shall have the righl to place on the Premises, at locations selected by LE=SSER, any sign, awning, banner, or other exterior decorations which are permitted by applicable zoning ordinances and private restrictions. Lt SSOR may roluse consent to any proposed signage, Ihal is in LESSOITS opinion loo large, deceptive, una(traclive or otherwise inconsislent will) or inappropriate to the Premises or use of any other tenant. LESSOR shall assist and cooporale with LESSEE in obtaining any necessary permi,sion from governmental authorities or adjoining owners and occupants for LESSEE to place or construct the foregoing signs. L.F.iSSt l'c shall repair,all damage to the Premises resulting from the removal of signs installed by LESSEE. -10. FIF.1 AII-i s ANn MAINTENANCE: "I'llo �_J LIES OR (ot°) 1,1 LESSEE shalt maintain thc healing, ventilation, air-conditioning systems servicing the Premises. (A) LC-Zson's 013L1GATIONS F.'xcopt as provided in section 17, and except for damage caused by negligent or intentional act of omission of LESSEE, LESSEI_S agents, employees, or invitees, LESSOR at its sole cost and expense shall keep in good condition and repair of the foundations, exterior walls, and exterior roof of the Premises, LESSOR shall also maintain the unexposed electrical, plumbing, and sewage systems including, without limitation, those portions of the system lying outside the Premises: window frames, gutters and down spouts on the building, all sidewalks, landscaping and other improvements that are a part of the Premises or of which the Premises are a part. LESSOR shall resurface and re-stripe the parking area on or adjacent to the Premises when necessary. LESSOR shall have thirty (30) days a(ler notice from the LESSEE to commence to perform it's obligations under this section, except that the LESSOR shall perform these obligations immediately if the nature of the problem presents a hazard or emergency situation. If LESSOn does not perform these obligations within the time set forth in this section,'LESSEE can perform said obligations and shall have the right to be reimbursed for the amount that LESSEE actually expends in the performance of LESSOR'S obligations. Page 2 of 10 It LESSOI-1 does not reimburse L=S FE= within thirty ('30) days after demand from LESSEE, LESSEE'S sole rernedy shall be to institute a suit against the L_ESSOn, and LESSEIF shall not have the right to withhold from future rent the sums LESSEE has expended. (B) t LSSEVS 0GLIGMIONS. Subject to the provisions of subsection (a) above and section 17 LESSEE at LESSEE'S sole cost and expense shall keep in good order, condition and repair the Premises and every part thereof including, without limitation, all of LESSEE'S personal properly, fixtures, signs, store fronts, plate glass, show windows, doors, interior walls, interior ceiling, and lighting facilities. It LESSEE fails to perform LESSEE'S obligation as slated herein, LESSOR may at it's option (but shall not be required to), enter the Premises, after ten (10) days prior written notice to LESSEE, put the sarne in good order, condition and repair, and the costs thereof together with interest thereon (at a rate equal to the lesser of the then highest lawful rate or % per annum) shall become due and payable as additional rental to I_I SSOR together with LI:SS1 E' next rental. S :_LA X.V :.ts: (A) nEAL PROPEATY TAxe:s ft LIE SSOR (or) 0 LESSEE shall pay all real properly taxes and general assessments levied and assessed against the Premises during the term of this lease. If it shall be the LESSEE'S obligation to pay such real properly taxes and assessments hereunder, LESSON shall use its best efforts to cause the I:'rerrtises to be separately assessed from other real property owned by the LESSOR. If LESSOR is unable to obtain such a soprartste assessment, the assessor's evaluation (lased on the building and other intproverrrents that are a part of the Premises shall be usod to determine real properly taxes If this evaluation is not available, the parties shall equitable allocate; the property taxes belwoon (lie building and o(hei improvements that are a part of the Premises and all buildings and other improvements included in the lax bill. In making the allocation, the parties shall reasonably evaluate the factors to determine the amount of real property saxes so that so that [lie allocation of the building and other improvements that are a part of the Premises shall not be less Than (he ratio of the total number of square feet of the building and other improvements [flat are part of the ["remises bears to the total number of square feet of land included in [lie tax bill (0) PERSONAL PnoPFni'Y°f AXt~S LESSEI-H shall pay prior to the delinquency all (axes assessed against and levied upon the trade fixtures, furrlrsltings, equipment and other personal property of LESSEE contained in the Premises. LESSr','E shall endeavor to cause such trade fix(ures, furnishings and equipment and all other personal property to be assessed and billed separately Irom the property of the LESSOR. If any LESSEE'S said personal property shall be assessed Will LESSOR'S property, LESSEE shall pay the LESSOR the taxes attributable to LESSEE within ten (10) days after receipt of a written statement from LESSOR setting forth the taxes applicable to LESSEE'S property. 12. C_,_rorprt._s_CERTir-lcn•rLS, 1'ach party, within ten (10) days Alter notice from the olllor party, shall execute: and deliver to the requesting party a esloppe,ls certificate staling that this Lease is unmodified and in full force and effect, or in (till forca and ellecl as modified, and Slating the modificcl lion. The certificate shall also stale the amount of rrrinirrium monthly rent,the dales to which rent has been paid in advance, and the amount of any security deposit of prepaid rent, If arty. as well as acknowledging that there are not, to that party's knowledge, any uncured defaults on the part of the other party, or specifying such defaults, if any, which are claimed. i� t l::sst�rf';� tcr+•r,_;,r'o t sl> ��;tafv; LESSOR and 1 ESSOR'S agent shall have the right to enter the Premises at reasonable times for the purpose of inspecling same, showing the same (0 prospective purchasers, tenants, or lenders, and (as LESSOR may deem necrassary or desirable) making such alterations, repairs, improvements or additions to the Premises or for the purpose of posting notices of non responsibly for alterations, additions or repairs to the building of which the Promises are a part. LESSOR may at any time place on or about tite Premises any ordinary "For Sale" signs and LI'SSOR may at any time during the last one hundred twenty(120) days of the term of this Lease place on or about the Premises any ordinary"For Sale or Lease"signs,all without rebate of rent or liability to LESSEE WI�l, ��1ftL POSSESSION: µIn the avant that the LESSOR shall permit LESSEE to occupy the Premises prior to the commencement date of the lean of this Lease, such occupancy shall be subject to all the provisions of this Lease. Said early possession shall not advance the termination date of this Lease, purge 3 of 10 1y055EasIQN.' If the LESSOh1 for any reason cannot deliver possession of the Prermises to LESSEE at the commencement of the term, the LESSOR shall not be liable to LESSEE for any loss or damage as a result of this inability. However, there shall be a proportionate deduction of rent. In addition, the Lease shall be void or void-able for a period of ten (10) days thereafter. If for any reason the Premises cannot be delivered within said_ 15 day period, the LESSEE rnay, prior to LESSOR'S delivery of the Premises, declare this Lease to be null and void and all money paid to LESSON shall he refunded to LESSEE 1'.6.. ALTMATIONS A14D)DITIQN+s: LESSEE shall not, without the LESSOR'S prior written consent, male any alterations, improvements or additions in or about the Premises except for nun-structural work which does not exceed$1,000 in cost per month, The LESSON has the right to require the LESSEE to remove any alterations, improvements, or additions at the expiration of the lease, and to restore the any or all harts of [Ile Premises to their prior condition. Il LESSOR so chooses and gives LESSEE written notice of their choice at least _ dErys prior to the fast day of this lease Ihe7 i LESSEE, at its sole cost, shall restore the Premises to tlirw�onditson cieslgnated by LE51JOR in its notice before the least clay of 1hi s Lease Beforo cornmencing any work relating to the alterations, additions, or improvements affecting the Premises, LESSEE shall notify LESSOR in writing of the expected elate of the commencement of such work so that LESSOR can post and record the appropriate notices of non-responsibility to protect LESSOR from any mechanic's liens, material liens, or any other liens. In any ovont, LESSEE shall pay, when due, all claims for labor and materials furnished to or for LESSEE at or for use in the Premises. LESSEE shall riot permit any mechanic's liens or material liens to be levied against the Premises for any labor or material furnished to LESSEE or claimed to have been furnished to LESSEE or LESSEE'S agents or contractors in connection with work ref any character ppdornied or claimed to Nava been perlormed on the Premises by or at the direction of I_C:uISLL. Li:!3:iEE.'. shall have the right to assess Stich lien if, immediately on demand by LESSOR, LESSEE procures and records a lien release bond meeting all legal requiromenls and shall provide for the payment of any r:-um that the claimant may recover on the clain'r (together with the costs of suit, if it is recovered in the aclion). All alterations, improvements, and additions are to be made: in a workmanlike manner and utilizing good quality materials. Unless the LESSOR requires their removal as set lorth above, all alterations, improvements or additions which are made on the Pren'rises by the LESSFE shall become the properly of the LESSOFI and remain upon and be surrendered with the Premises at the expiration of the term. Notwithstanding the provisions of this section, L.L:S51::E'S trade fixtures, furniture, equipment and other machinery, other than that which is affixed to the Premises so that it cannot be removed without matoriClil or structural darnage to the Premises; shall remain the property of the LL-SSEE'' and removed by LESSEE ai the expiration of the term of this Lease. L t':SSEE: shall not change any look nor shall LESSEE alter any lock so that the keys originally furnished by LESSOR will not operate the same without LESSOR written perrmission. d;i. DAMAGIE Oil QFSTnUCTICN: (A)i AMAc,, --IN$tJflrD If, during the term of this Lease, the Premises and/or tho building and other improvements in which the Premises are located are totally or partially destroyed rendering the Premises totally or partially inaccessible or unusable, and such damage or destruction was caused by a casualty covered ender an insurance policy required to be maintained hereunder I_FSSOfq shall restore the Premises and/or lfie building and other improvements in which the Premises are located into substantially the same condition as they were in immediately before such damage or destruction, provided that the restoration can be made under the existing laws and can be completed within ninety (90) working days after the date of such destruction or damage. Such destruction or damage shall not terminate this Lease. If the restoration cannot be made in same ninety (90) day period, then within fifteen (15) days after the parties determine that the restoration cannot be made in the tinge stated in this subsection. LESSEE may terminate this Lease immediately by giving notice to LESSOR and the Lease will be deemed cancelled as of the date of such damage or destruction. If LESSEE fails to terminate this Lease and the restoration is permitted under the existing laws, LESSON, at its option, may terminate Ihis Lease or restore the Premises and/or any other improvements in which the Premises are located within a reasonable time and this Lease shall continue in full force and affect, If the existing laws do not permit the restoration, either party can terminate this Lease immediately by giving notice to the other party. Pale 4 of 10 Notwithstanding the above, if the LESSEE is the insuring party and if the insurance proceeds received by LESSOR are not sufficient to affect such repair, LESSOR shall givo notice to LESSEE of the amount required in addition to the insurance proceeds to affect such repair. LESSEE may, at LESSEE'S option, contribute the required amount, but upon failure to do so within thirty (30) days following such notice, LESSOR'S solo remedy shall be, LESSEE'S option and with no liability to LESSEE, to cancel and terminate this Lease. LESSEE shall contribute such amount to LESSOR within said thirty (30) day period, LESSOR shall make such repairs as soon as reasonably possible and this Lease shall continue. LESSEE shall in no event have any right to reimbursement for any amount so contributed. (I)) DAMAGE. UNINSunrO In the even[ that the Premises are damaged or destroyed by a casually which is not covered by the fire and extended coverage insurance required to he carried by the party designated in subsection (a) above, then LIHSSOR shall restore the same; provided that if the damage or destruction is to an extent grea[er than ten (10%) percent of the then replacement costs of such improvements on the Premises (exclusive of LESSEE'S trade fixtures and equipment and exclusive of foundations and footings), then LESSOR may elect not to restore and to terminate this Lease, LESSOR must give to LESSEE written notice of its intention not to restore within Ihirty (30) days from the date of such damage or destruction and, if not given, LESSOR shall be deemed to have elected to r(as[ore and in such event shall repair any damage as soon as reasonably possible_ In the event that LESSOR olecls to give such notice of LE=SSOR'S Intention to cancel and terminate this Lease, LESSEE shall have the right, within len (10) days after receipt of such notice, to give written notice to LESSOR of LESSEE'S intention to repair such damage at LGSSL.I_'S expense, without reimbursement from LESSOR, in which event the Lease shall COntlllue In full force ad affect and LESSEE;shall proceed to make such repairs as soon as reasonably possible. It the LE=.SSEF does riot give such notice within such Ion (10) day period, this tease shall be cancelled and be dn:,emed terminated as of the date; of the occurrence of such damage or destruction. (Q) DAMAGE°NUAR THE ENO CAP TI"tr TERM If the Premises are totally or partially destroyed or damaged during the last twelve (12) months of the torm of this Lease, LESSOR may, al LESSORS option cancel and lerminate this Lease as of the date off the cause of such damage by giving written notice to LIH'SSIE_ of LE:SSOI t"S election to do so within thirty (30) days after the elate;of the occurrence of such damage; provided, however, that, if the damage or destruction occurs within the last Iwolve ('12) months of the learn and it within fifteen (15) days after the dales of such damage or destruction LESSEE exercises any option to extend the term provided herein, LESSOR shall restore the Premises if obligated to do so as provided in subsection (a) or(b)above, (I))ADATCMENT OF RENT If the Premises are partially or totally destroyed or damaged and LESSOR or LESSEE repairs or restores them pursuant to the provisions in this section, the rent payable hereunder for the period during which such damage, repair or restoration continues shall be abated in proportion to the degree to which LESSCE'S reasonable use of the Premises is impaired, (except for the abatement of rent, if any. LfiSSE=C shall have no clairyl against LE SSOFI for any damages suffered by reason of any such damage,destruction, repair or restoration, (I')'f I!IADr I°IxTUfirs ANO E0UIPMCNT. If LESSOR is required or elects to restore the Premises as provided in this section, LESSOR shall not be required to restore I.FSSI f:'S improvements, trade fixtures, equipment or alterations made by I.F.SSEE, such e)ccluded items being the sole responsibility of the t-ESSfEE to restore hereunder, (rl)Yo1Ar Dr,1 1UCTION Ni111.11 TUNANT BUll.t)ING If the; Premises arc a part of a multi use building arid there is destruction to the Premises and/or the building of which the Promises are a part that exceeds fifty (50%) percent of the then replacement value of the ('remises arid/or the building in which the Premises are a part from any Causa whether or not covered by the insurance dc•:scribed in subsection (a) above, LESSOR'S may, its option, elect to terminate this Lease (whether or not the Premises are destroyed) so long ras LESSOR'S termination leases of all other I.,IESSFE;S in the building of which the Preroises aro a part, affective; as of the dale of such damage or destruction. �8, INSURANCE. INDEMNITY: (A)Arm&P110PrnTY INSURANCI: O LI=SSOR (or) U LESSEE shall pay at its cost shall maintain during the term of this Lease on the Prerises a policy or policies of standard fire and extended coverage insurance to the extent of at least ninety (90%) percent Of full replacement value thereof. Said insurance policies shall be issued in the names of LESSOR and LESSEE, as their interests may appear. Paco 5 of 10 l C'SSEE at its cost shall maintain during the term of this Lease on all its personal property, LESSEF='S Improvements, and alterations in or about the Premises, a policy of standard fire and extended coverage insurance, with vandalism and malicious mischief endorsements, to the extent of their fulf replacement value. The proceeds from any such policy shall be used by LESSEE for the replacement of personal property or the restoration of LESSEr'S improvements or alterations. (0) LIABILRY INSURANCE LESSEE and LESSOR shall, each at Its own expense, maintain a policy or policies of comprehensive general liability insurance with respect to the partiCUlar activilies of each in the Building with the premiums thereon fully paid on or before due date. Such insurance policy shall be issued by and binding upon an insurance company approved by LESSOR, and shall afford minimum protection of not less than $1,000,000 cotrnbined single limit coverage of bodily injury, property damage or combination thereof. I_I SSEE shall provide LESSOR with current Certificates of Insurance evidencing LESSOR'S compliance with this Paragraph. 60111 public liability insurance and property damage insurance shall insure performance by LESSEE of the indemnity provisions in subsection (d) below, but the limits of such insurance shall not, however, limit the liability of LESSEE hereunder. L3olh Ll=`',SOFI and LESSEE shall be named as additional insured, and the policies shall contain cross- liability endorsements. If LESSEE- shall fail to procure. and maintain such insurance the LESSOR may, but shall not be requited to, procure and maintain same at the expense of LESSEES and the cost (hereof, together with interest the,ioon at a rate equal to the lesser of the then highest lawful rate or__%% per annum shall become due and (:dyable as additional'rental to LESSOR logether with LESSEE'S next rental installment. (C)WAIVER OF SUUROGATION LESSEE and LI-SSOn oath waives any and all rights of recovery against the other, or against the officers, employees, agents, and representatives of the other, for loss of or damage to such waiving party or its property or the properly of others under its COnlrOl, whOre such loss or damage is insured against under any insurance policy in force al lho time of such loss or damage. Each party shall cause each Insurance policy obtained by it hereunder 10 provide that the.; m urance company waives all right of recovery by way of subrogation against dither party in connection with any damage covered by any such policy. (I))1.101.1)HARMILE.SS LhSSEE shall indemnify and hold LESSOFI harmless from and against any and all claims arising hom LESSEE'S Else or occupancy of the Premises or frona the conduct of its business or from any activity, work, or things which may be permitted or suffered by I.ESSE.I in or about the Premises including all damage, costs, attorney's fees, expenses and liabilities incurred in the defcnso of any clairn or action or proceeding arising there from. Except l0r i.I.:SSOft'S willful ar grossly negligent conduct, LESSEE hereby assumes all risk of damage to property or injury to person In or about the Premises from any cause.;, and LESSEE hereby waives all claims in respect thereof against LESSOR. 19, CC)NIDEMNATION: 11 the Premises or any portion thereof r•,re taken by the power of eminent domain, or sold to a governmental agency by LESSOR under the threal of exercise of said power (all of which is herein referred to as condemnation), this Lease shall lerrninate as to the part so taken as of the dale the condemning authority takes title or possession, whichever occurs first. If more than ten (10%) percent of the floor area of any buildings on the Premises, or more than ten (10 1%) percent of the land area of the Premises not covered with buildings, is lateen by condemnation, either L.LSSOn"S or I_(::SSEE may terminate this Lease as of the date the condemning authority takes possession by notice in writing of such election within twenty (20) days after LESSON"S shall have notified LESSEE of such taking or, in the absence of such notice, then within twenty (20) days rafter the condemning authority shall have taken possc)sslon. Vent shall be abated or reduced during the period from the date of caking until the completion of restoralion by f.1=.S`yCan,but all other obligations of LESSEE under this Lease shall remain in full force and effect. The abatement or reduction of the rent shall be based on the extent to which the restoration interferes with LESSI=C'S use; of the Premises. All awards for the taking of any part of the Premises or any payment made under the threat of the exercise of the power of orninenl domain shall be.; the property of the LESSOR, whether made as compensation for the diminution of the value of the leasehold or for the taking of the fee or as severance damages; provided, however, that LESSEE shall be entitled to any award for loss or damage to LESSEE'S trade fixtures and removable porsonal property. Wage 6 of 10 ; i?T iUliftLftI�CF1: On the Iasi clay of the term hereof, or on any sooner termination, LESSEE:shall surrender the Premises to LtaSSOR In good condition, broom clean, ordinary weal, teat' accepted. LESSEE_ shall repair any damage to the Premises occasioned by its use fficreol, or by the removal of LE-ESE E'S trade fixtures, furnishings and equipment which repair shall include the patching and filling of holes and repair of structural damage LI-SSEE shall remove all it's personal property ano fixtures on the Premises prier to tite expiration of the term of this Lease and if required by LESSOR pursuant to section 10, any alterations, Improvements or additions made by LESSEE to the Premises. If LFSSE1 lulls to surrender the Premises to LESSOR on the expiration of the Lease as roquirucl by this section, LESSEE snail hold LESSOR harmless from all damages resulting from LESSEE'S failure to vacate the Promises, including, without limilalion, claims made by any succeeding LESSEE resulting from LESSEE failure to surrender the Premises. 21. HOLDING C)vr-n: it lhe (.F.SSEE , with the LESSOR'S S consent, remains in possession of the Premises after the expiration or termination of the loan of this Lease, such possession by LESSEE shall be deemed to be a Tenancy from monlh•to•• rrionth al a rental ii1 the amount of the last monthly rental ptus all other charges payable hereurscler, upon all the plrovisions of this Lease applicable to montir•to-month tenancy. Any addendum atlached hereto and either signed or initialed by the parties shall be deemed a part hereof and shalt ,uper,tec,je�rrty confllclirrg terms contained in this I..ease. �C�SI rJY IN(TlAll} 3,ril,Yr :IYI L7 n C}DTp iCltAl.1tGTtfiT:MCN'1'8 R5 LlaTt t7 C3 L.Ow: Extension or H mewal of Lease(Fornn 997) Option to Purchase (I Orn) 1480) X Other(specify) -. A[3t et:u utn.No. 1.._..-....._ ----- -.-Other(specify) 23. S030TIDINATION: This;Lesiso, at LESSOR'S optiori, shall be subordinale to all existing and future liens and encumbrances against lh() Promises. Notwithstanding any such subordination, LESSEE'S right to quiet possession of 1110 Premises shall not be disturtmd if LESS(-.E is not in default and so long as LESSEE shall pay the rent and observe and perform all the othrar provisions of this I-ease, unless tiNs Lease is otherwise terminated pursuant to its terms. If any rTl0rtg0QGU, (rusted, or ground l_f-SSOR sliall elect to have this Lease prior to the lien of its mortgage or deed of trust or ground lease and shall give: writteri notice thereof to LESSEE, this Lease shall be deemed prior to such mortgage, deed of trust or ground lease, whether this Lease is dated prior to or subsequent to the date of such mortgage,deed of trust or ground lease,or the dale of recording thereof. LESSEE agrees to execute any documents requiring to 91jecl such subordinanlron or Io rYrako this I..Gase prior to the lien of any mortgage, deed of trust, or ground lease, as the case may be, and failinr,.) Ira do so wit(lin (10) days after written demand from LESSOR does hereby make, constitute. and irrevocably appoint LESSEE as LESSEFS attorney in fact and in LESSC.EF'S name, place and steA to do so. _..._...(A)1 EVE NTS or:DEhFAtll.T The occurrence of any one or morn of the following events shall constitute a de:faull and breach of this Lease by LE;SSF.,E: ('I) Failure. to pay rent when due, if the failure continues for the period specific under applicable State law after alter written notice has been given to LESSEL. (2) Abandonment rand vacation of the Promises (failure to occupy(lie Premises for fourteen (14)consecutive days shall be deemed an Abaridonment and vacation (3) f=ailure: to perform any other provision of this Lease if the failure to perform is not cured within thirty(30) days altor written notice thereof has been given to LESSEE by LESSOR. If the default cannot reasonably be cured within said thirty (30) day period. LESSEE shall not be in default under this Lease if LESSEE commences to cure the default within the thirty(30) day period and diligently prosecutes the same to completion, (u)L-L:sSQF1'S REMLUIES The LESSOR shall have the following remedies if I.ESSEE commits a default under this Lease. These minedles ar- not exclusive but are cumulative and in addition to arty rernedies now or hereafter allowed by applicable State law. Page'/of 10 LESSOf={can continue this Lease in full force arid effect, and the Lease will continue in effect so lone as LESSOR does riot terminate LESSEE'S right to possession, and the LESSOR shall have the right to collect rent when due. During the period that LESSEE is in default, LESSOR can enter the Promises and relief them, or any part of them, to third parties for LESSEE'S account. LESSEE shall be liable immediately to the LESSOR for all costs the LESSOR incurs in reletting the Premises, including, without limitation, brokers' commissions, expenses of remodeling the Premises required by the reletting, and like costs. Retailing can be for a period shorter or longer than the remaining term of this Lease. LESSEE shall pay to LESSOR the rent due under this Lease on the dates the rent is due, less the rent LESSOR receives from any reletting. No act by LI=SSOR allowed by [his section shall terminate this Lease unless LESSOR notifies LESSEE that LESSOR elects to terminate this Lease. After- LESSEE'S default and for so long as LESSOR has not terminated LESSEE'S right to possession of the Premises, if LESSEE obtains LESSOR'S consent, LESSEE shall have the right to assume or sublet its interest in the Lease, but LESSEE shall not be released from liability. LESSOR'S consent to the proposed assignment or subletting shall riot be unro:asonably withheld. If LESSOR sleets to relet the Premises as provided in this section, any rent that LESSOR receives from such reletting shall apply first to the payment of any indebtedness from LESSEE to LESSOR other than the rent due from LESSEE to LESSOR; secondly, to all costs, including mainlenance, incurred by LESSOR in such relelling; and third, to any rent due and unpaid under this Lease, After deducting the payments referred to in this section, any sum remaining from the rent LESSOR receives from such reletting shall be held by LESSOR and applied in payment of future rent as rent becomes due under this Lease. In no event shall LESSEE be entitled to any excess rent received by LESSOR. If, on the date rent is due under this Lease, the rent received from the reletting is less than the rent due, on that dale, LESSEE shall pay to LESSOR, in addition to Thos remaining rent due, all costs, including maintenance, that LESSOR shall have incurred in relelling that remain after applying the rent received from relelling as provided in this section, LESSOR can, at its option, terminate LESSEE'S right to possession of the Premises at any tinre. No act by LESSOR other than giving wrilten notice to LESSEE shall lerrninale this Lease Acts of maintenance, efforts to rolet the Premises, or lire appointment of a receiver on LESSOR'S initiative to protect LESSOR'S interest in (his I..ease shall not constitute a termination of LESSEE'S right to Iossession. In the cavent of such termination, LE-SSOF has the right to recover from LESSEE_ (1) 'T'ho worth, at the lime, of the award, of (he unpaid rent that had been earned at the time of the termination of this Lease. (2),The worth, at the time of the award, of the amount by which the unpaid rent that would have been earned after, the date of the termination of this Lease until the lime of the award exceeds the amount of they loss of rent that LESSEE proves could have been reasonably avoided; (:3) Tho worth, at the time of the award, of the amount by which the unpaid rent for the balance of the term after the timo of the award exceeds [he amount of the loss of rent that LESSEE proves could have been reasonably avoided; and (4) Any other amount, including court costs, necessary to compensate; LESSOR, for all detriment directly or indirectly caused by LESSEE'S default. Th© worth at the time of the award, as used in (1) and (2) of this section is to be,computed by allowing interest at the maximum rate an individual is permitted by law to charge. "The worth at the Ifine of the award," as referred to in (3) of this section is to be computed by discounting lho amount at the discount rate of the Applicable Federal Reserve Bank at the time of the award, plus one (1%) percorrl. If LESSEE" is in default under the terms of this Lease, LESSOR shall have the additional right to have a receiver appointed to collect rent and conduct LESSE'E'S business. Neither the; filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by LESS On to terminate this Lease. LI:;;SOR at any time after LESSEE commits a default can cure the default at LESSEE'S cost and expense. If LESSOR at any time, by reason of LESSEE'S default, pays any sum or does any act that requires the payment of any Burn, the sum paid by LESSOR shall be due irminedialely fiom I...SSEE to LESSOR at the time the sum is paid, arid if paid at a later date shall bear interest al the maximum rate an individual is permitted to charge from the; dato the sum is paid by LESSOR until LESSOR is reimbursed by LESSEE. The sum, together with interest thereon, shall be considered additional rent. LXSFalVS fn ARILITY: The term "LESSOR" as used in this Lease shall mean only the owner or owners at the lime in question of the fee title or a LESSEE'S interest in a ground lease of the Premises, and in the event of any transfer of such title or interest, LESSOR herein named (and in case of any subsequent transfers to the then successor) shall be relieved from and after the date of such transfer of all liability in respect to LESSOR'S obligations thereafter to be performed, The obligations contained in this Lease to be performed by LESSOR shall be binding upon the LESSOR'S successors and assigns, only during their respective periods of ownership. Page U 01 10 G. bjnMING. [)tiring the term of [his Lease, LESSEE shall have the non-exclusive use in common with LE=SSOR, nitwr hmanls rrf If e Building, their guests and invitoos, of the non-reserved cornmoil automobile narking areas, drkveways, and Icwtways Subject to rubs and regulations for the use thereof as prescribed from time to tirno by LESSOR. LESSU9 ruserves lfie riclhl to designate parking areas for LESSI E; and LESSCC'S agents and employees. LESSEE shall provide LESSOR with a list of all license numbers for the cars owned by LESSEE, its agents and employees. In Ilae evem the Premises are situated in a shopping center or in a commercial building or in a commercial development in which there are common areas, I_ESSIFE agrees to pay his pro-rate share of maintenance, taxes, and insurance lot-the common areas if such costs are not already included in the rent, 2f!. 1--'sset '9 Rig f"r To cunE Ltn�>orl_`_s f� AULI In the: event that LESSOR shall fail, refuse or neglect to pay any mortgages, liens or encumbrances,the judicial sale of which might affect the interest of LESSEE hereunder, or shall fail, refuse or neglect to pay any interest due or payable on any such mortgage, lien or encumbrance, LESSEE may pay said mortgage, liens or encumbrances, or interest or perform said conditions and charge to LESSOR the amount so paid and withhold and deduct frorn any rents I*rerein reserved such amounts so paid, and any excess over and above the amounts of said rents shall be paid by u sSOf-i to LE-SSEE., 2J, I umF--s: Whenever under this Lease a provision is made for any demand, notice, or declaration of any kind, it shall be in writing and served either personally or sent by registered or certified United States mail, postage prepaid, addressed al the addresses set forth below. aC7f[T„A;r: f t7 f,ESSF.r AT, _130 South Main Street Lake_-Porost,- California 97630 Lake Elsinore, California 92530 _Attn. _City Man a er fi•,mh nmces•.hMI I'D deemed in oo recmvcdv rnnv„oelhl into hour;I•mn we P11+n of nuduin 1I rf4 de(I 15 nro1rdotl roc M 1111s;ncnoA. 30. Ai-'r(.)nNFYS I'EU'S: If cither�party�commences an action (litigation, medialion, or arbitration) against the other party arising out of or in connoctron with this Lease, Iho Premises, or the building or other improvements in which the Premises are located, lhc� prevailing party shall be entitled to have and recover from the losing party reasonable attorney's fees and costs of suit. LESSOR shall not unreasonably withhold or delay consent with respect to any matter for which the LESSOR'S consent is required or desirable under this lease. ;l 1. {'t0fCl"Ra: 'i onant represents that Tenant was not shown the Premises by any real estate broker or agent and that Tenant has not otherwise engaged in, any activity which could lorm the basis for a claim for real estate commission, brokerage fee-, findor's fee or other similar charge, in connection with this Lease. __L ig(,UI,.A• ANI Pl,lJ1 AL hen required by the context of this t,.ease, the singular shall indicate the plural. . �L„k 1) -nONS: [';ach piov[sion of this Lease put formable by LESSI.E shall be deemed both a covenant and a condition Zfi,. {31IVpfN[ CJ f4_SUC_Cm!!,s,OnS ANo AssigV s;. I'Ple covcanams and conditions herein contained shall, subject to the provisions as to assignment, apply to and bind the heirs, successors, executors, administrators and assigns, of all the parties hereto; and all the parties hereto shall be jointly and separately liable hereunder No G1101GE OF LAW: I tus L-eRso shall be governed by the laws of the Stale where the Premises are located Pace 9 of 10 X ,,ffilfla'!'Ih110 SEMIAl_!C71U1�Arl[ M§: "Party' shall mean LESSOR and LESSEE; and if more than one person or entity is the LESSOR or LESS(7--E, the obligations imposed on that pally and several. 31). WAIVERS: No waiver by LESSOn of any provision hereof shall be deemed a waiver of any other provision hereof or of any subsequent breach by LESSEE of the same or any other provision. LLSSUR'S consent to or approval of any act shall not be deorried to render unnecessary the obtaining of LESSON'S consent to or approval of any subsequent act by LESSEE. The acceptance of reril I1er®Under by LESSOR shall not be a waiver of any precedllg breach by LESSEE of any provision heiroof, roller than the failure of LESSEE to pay the particular rent so accepted, regardless of LESSORS knowledge of such pruceding breach at the time of its acceptance of such rent. 39. •111VIE: Wulime is of the essence of this lease. 4(,f. HL,AMNGS. 1Tho hoadings, used in this Lease are for convenience of the parties only and shall not be considered in interp+eting the I7leaning of any provision of this tease, 41. fM'J:flAI ILP'PY: l'lin unerllorceability, invalidity, or illegality of any provision of this Lease shall not render the other provisions hereof unenforceable, invalid or illegal, 4.2. � tV'T'Ili€r- A_(.,nE-_E CHff: Tljis lease contains the entire agreement between LESSEE and LESSOR relating to the leasing of the demised premises. No re pros onlation, which is riot incorporated herein, shall be binding upon LES50R, and all r(-presontations which have been made are tnrorpamled herein or, if not so incorporated, shall be doerned to have boom waived by LESSEE. All preliminary negotiations 6otwcon the parties are morged inter, and superseded by, the provisions of this lease. his L.oasc may be modified only in writing,and signed by the parties in interest at the time of such modification. This kmso shall not be enforceable until executed by both LESSEE and L.ESSOn. THL;PAIITIES HEIRETO HAVE EXECUTED THIS LEASE ON'I'iic oATE ABOVk.'W¢1tl)IT . �. I�• - 11;56«L1'6�{l'tBilllnrll LI:S51:C'S Alll(%'JSAPII Page 10 of 10 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO:) ) City of Lake Elsinore ) 130 S. Main Street ) Lake Elsinore, California 92530 ) Attn: City Clerk ) ) (Space above for Recorder’s Use Only) This document is exempt from the payment of a recording fee pursuantto Government Code Section 27383. MEMORANDUM OF LEASE This Memorandum of Lease (this “Memorandum”) is dated for identification purposes as of this 1stday of April,2019, by and between Genaro and Mabel A. Prats, husband and wife (“Lessor”) and the City of Lake Elsinore, a California municipal corporation(the “Lessee”). This Memorandum is made with reference to the following: 1.Lessor is the owner in fee of that certain real property located in the City of Lake Elsinore, County of Riverside, State of California, more particularly described in the legal description attached hereto as Exhibit “A”and incorporated herein by this reference (the “Premises”). 2.Lessorand Lesseehave entered into that certainCommercial Lease and Addendum No. 1 thereto dated December 18, 2006 for the lease of 114 South Main Street (APN 373-151-021) as amended by Addendum No. 2 and Addendum No. 3 (collectively, the “Lease”), that provides for the lease of the Premisesto Lesseepursuant to the terms and conditions set forth therein. The provisions of the Lease are hereby incorporated by reference as though set forth in full.Capitalized terms not defined herein shall have the meanings defined in the Lease. 3.Pursuant to Section 2 of Addendum No. 3, Lessor has granted to Lessee a first right of refusal to purchase the Premisesin the event Lessor, in its sole discretion, elects to sell the Premises. 4.The Lease is a public record and is available for public inspection in the office of the City Clerk of the City of Lake Elsinore at 130 S. Main Street, Lake Elsinore, California 92530. 5.The purpose of this Memorandum is to provide notice to all persons of the existence of the Lease. This Memorandum is prepared for the purpose of recordation and in no way modifies the provisions of the Lease. @BCL@380FD82D 2 IN WITNESS WHEREOF, Lessorand Lesseehave executed this Memorandum as of the date first set forth above. “LESSOR” GENARO and MABEL A. PRATS, husband and wife Genaro Prats Mabel A.Prats “LESSEE” CITY OF LAKE ELSINORE, aCalifornia municipal corporation By: _______________________________ Grant Yates, City Manager ATTEST: By: __________________________ City Clerk APPROVED AS TO FORM: LEIBOLD, McCLENDON & MANN, P.C. By: ___________________________ Barbara Leibold, City Attorney STATE OF CALIFORNIA ) ) § County of ) On , before me, a Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct WITNESS my hand and official seal. ________________________________ Signature of Notary (Affix seal here) A notary public or other officer completing this certificate verifies only the identity of theindividual who signed the document to which thiscertificate is attached, and not the truthfulness,accuracy, or validity of that document. STATE OF CALIFORNIA ) ) § County of ) On , before me, a Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct WITNESS my hand and official seal. ________________________________ Signature of Notary (Affix seal here) A notary public or other officer completing this certificate verifies only the identity of theindividual who signed the document to which thiscertificate is attached, and not the truthfulness,accuracy, or validity of that document. STATE OF CALIFORNIA ) ) § County of ) On , before me, a Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct WITNESS my hand and official seal. ________________________________ Signature of Notary (Affix seal here) A notary public or other officer completing this certificate verifies only the identity of theindividual who signed the document to which thiscertificate is attached, and not the truthfulness,accuracy, or validity of that document. EXHIBIT “A” LEGAL DESCRIPTION The real property in the City of LAKE ELSINORE, County of Riverside, State of California, described as: THE NORTHEASTERLY RECTANGULAR HALF OF LOT 3 IN BLOCK F OF JONES ADDITION TO ELSINORE, AS SHOWN BY MAP RECORDED IN BOOK 4 PAGE 177 OF MAPS, RECORDS OF SAN DIEGO COUNTY, CALIFORNIA. EXCEPT THE WESTERLY 10.00 FEET DEEDED TO THE CITY OF LAKE ELSINORE FOR THE PURPOSE OF WIDENING MAIN STREET.