HomeMy WebLinkAboutReso 51-2017 (17-573) sAA, City of South San Francisco
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Resolution: RES 51-2017
File Number: 17-573 Enactment Number: RES 51-2017
RESOLUTION APPROVING A LEASE AGREEMENT WITH RED
CART MARKET INC., DBA PET CLUB STORES, A CALIFORNIA
CORPORATION, FOR THE CONTINUED TENANCY AT 1
CHESTNUT AVENUE IN SOUTH SAN FRANCISCO
WHEREAS, in December 2012,the Oversight Board for the Successor Agency to the
Redevelopment Agency of the City of South San Francisco (Oversight Board) approved the original
Lease Agreement with Red Cart Market, Inc., dba Pet Club Stores(Pet Club),to use the property at 1
Chestnut Avenue for a retail use; and
WHEREAS,the original Lease Agreement with the Pet Club included a term of three years with
a one-year option for extension, at a duly-noticed public meeting; and
WHEREAS, on July 12, 2013, the Pet Club officially opened for business and has complied to
the terms of the original lease; and
WHEREAS, the original Lease Agreement between the City and the Pet Club will end on July
11, 2017, and
WHEREAS, in March 2017,the Pet Club and City staff negotiated a new Lease Agreement for
the entire building and site at 1 Chestnut Avenue for retail use for a term of six-months and
month-to-month thereafter, to allow the store owners to plan for closing the store and finding an
alternative site; and
WHEREAS,the staff recommends that the City Council approve the Lease Agreement.
NOW, THEREFORE, the City Council of the City of South San Francisco does hereby resolve as
follows:
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of South San Francisco
that the City Council hereby takes the following actions:
Approve the Lease Agreement with Red Cart Market, Inc., dba Pet Club Stores, for 1 Chestnut Avenue,
attached hereto as Exhibit A and incorporated herein; and
Authorize the City Manager, or his designee,to execute the Lease Agreement and any related
City of South San Francisco Page 1
File Number: 17-573 Enactment Number: RES 51-2017
uments, subject to review and approval as to form by the City Attorney; and
Authorize the City Manager to take any other related actions necessary to carry out the intent of this
Resolution.
At a meeting of the Special City Council on 6/14/2017, a motion was made by Liza Normandy,
seconded by Mark Addiego, that this Resolution be approved. The motion passed.
Yes: 5 Matsumoto, Normandy,Addiego, Gupta, and Garbarino
Attest by
Gabriel Rodriguez
City of South San Francisco Page 2
LEASE AGREEMENT
of
1 CHESTNUT AVENUE
This Lease Agreement ("Lease") is entered into effective as of 7/12/2017, (the "Effective Date")
by and between THE CITY OF SOUTH SAN FRANCISCO, a Municipal Corporation ("Landlord" or
"Agency"), and RED CART MARKET INC. dba PET CLUB STORES, A California corporation
(collectively "Tenant"). Landlord and Tenant are hereinafter referred to collectively as the "Parties."
ARTICLE I
BASIC LEASE PROVISIONS
1.1 Landlord's mailing address: City of South San Francisco
P.O. Box 711, South San Francisco, CA 94083
1.2 Landlord's contact: Mike Futrell, City Manager
Telephone: (650) 829-6620
1.3 Tenant's address: Pet Club, 3535 Hollis Street, Emeryville, CA 94608
Telephone: (510) 595-8120
1.4 Tenant's contact: Tom Lee
1.5 Premises address: 1 Chestnut Avenue, South San Francisco, CA 94080
1.6 Rentable Square Footage: Approximately 27,792 square feet, depicted in Exhibit A.
1.7 Commencement Date: July 12, 2017
1.8 Term: Six (6) months, followed by month to month.
1.9 Expiration Date: January 11, 2018
1.10 Option to Extend Term: Month to month. See Section 3.3.
1.11 Base Rent:
Period (Month) Monthly Base Rent
1-6
$24,000.00
Month to Month $24,000.00
1.12 Security Deposit: Landlord acknowledges receipt of the security deposit of $37,519.00 transferred
as a credit from the prior lease entered into between Landlord and Tenant dated January 8,
2013 as security for the full and faithful performance of each and every term, provision, covenant and
condition of this Lease, which is to be administered as provided in Section 4.6, below.
1.13 Rent Commencement: July 12, 2017
1.14 Permitted Uses: Retail store with veterinarian, clinic, pet grooming and washing, and pet
adoption services, only in accordance with Applicable Laws.
1.15 Parking: Tenant may use up to one hundred forty-one (141) parking spaces in Landlord’s surface
parking lot on an unreserved basis.
ARTICLE II
DEFINITIONS
Definitions. As used in this Lease, the following terms shall have the definitions set forth below.
Additional terms are defined in the remainder of the Lease.
2.1 "Additional Rent" means any and all sums other than Base Rent which Tenant is or becomes
obligated to pay to Landlord under this Lease (whether or not specifically called "Additional Rent" in this
Lease).
2.2 "Affiliate of Tenant" means any entity that controls, is controlled by, or is under common
control with Tenant. "Control" means the direct or indirect ownership of more than fifty percent (50%) of
the voting securities of an entity or possession of the right to vote more than fifty percent (50%) of the
voting interest in the ordinary direction of the entity's affairs.
2.3 "Alterations" means any alterations, decorations, modifications, additions or improvements
made in, on, about, under or contiguous to the Premises by or for the benefit of Tenant (other than the
Tenant Improvements) including but not limited to, telecommunications and/or data cabling, lighting,
HVAC and electrical fixtures, pipes and conduits, partitions, cabinetwork and carpeting.
2.4 "Applicable Laws" is defined in Section 5.5.
2.5 "Base Rent" means for each Lease Year the monthly amount payable for the Premises rented by
Tenant as set forth in Section 1.11 .
2.6 "Building" means the building located at 1 Chestnut Avenue, South San Francisco, California.
2.7 "Claims” is defined in Section 6.3.
2.8 "Commencement Date" is the date set forth in Section 1.7.
2.9 "Common Area" means all areas and facilities located on the Land or in the Building, exclusive
of the Premises. The Common Area includes, but is not limited to, retail parking areas, access and
perimeter roads, sidewalks, landscaped areas and similar areas and facilities.
2.10 "Environmental Laws" is defined in Section 6.6.
2.11 "Hazardous Material" is defined in Section 6.5.
2.12 "Indemnitees” is defined in Section 6.3.
2.13 "Premises" means the premises shown on Exhibit A consisting of 27,792 square feet of rentable
space in the Building.
2.14 "Real Property" means collectively, (i) the Building; (ii) the parcel of real property on which the
Building is situated (the "Land"); and (iii) the other improvements on the Land, including, without
limitation, a retail parking lot, driveways, lighting and landscaping.
2.15 "Real Property Taxes" is defined in Section 4.5.
2.16 "Rent" means Base Rent and any Additional Rent, collectively.
2.17 "Tenant Parties" is defined in Section 6.1.
2.18 "Term" means the term of this Lease as set forth in Section 1.8 as such may be extended
pursuant to the terms hereof.
ARTICLE III
PREMISES AND TERM
3.1 Lease of Premises. Subject to and upon the terms and conditions set forth herein, Landlord
hereby leases the Real Property to Tenant and Tenant hereby leases the Real Property from Landlord. A
portion of the Real Property includes the Premises which consist of the Building commonly known as One
Chestnut A venue which is depicted in the diagram attached hereto as Exhibit A. Tenant acknowledges
that Landlord has made no representation or warranty regarding the condition of the Premises, the
Building or the Real Property except as specifically stated in this Lease. As used in this Lease, the term
"Rentable Square Footage" means the net rentable area measured according to standards similar to the
standards published by the Building Owners and Managers Association International, Publication ANSI
Z65.1-1996, as amended from time to time. The Parties agree that the Rentable Square Footage of th e
Premises is 27,792 square feet and the Usable Square Footage of the Premises is also 27,792 square feet.
Tenant and Landlord hereby stipulate and agree that same are correct, notwithstanding any minor
variations in measurement or other minor variations t hat may have been incurred in the calculation
thereof. If the Building is ever demolished, altered, remodeled, renovated, expanded or otherwise changed
in such a manner as to alter the amount of space contained therein, then the Rentable Squar e Footage of
the Building shall be adjusted and recalculated by using the foregoing method of determining Rentable
Square Footage, but such recalculation shall not increase the rental hereunder. The Rentable Square
Footage of the Building is stipulated for all purposes to be 27,792 square feet.
3.2 Term and Commencement. The Term of this Lease shall commence on the Commencement
Date, and unless sooner terminated as provided herein, the Term shall be for the period set forth in Section
1.8 as the same may be extended in accordance with any option or options to extend the Term granted
herein.
3.3 Option to Extend Term. Landlord grants Tenant an option to extend the Lease Term
("Extension Options") solely on a month to month basis until the time that Landlord provides Tenant with
a Notice of Termination.
3.3.1 Extension Option Conditions. An Extension Option may be exercised, only by written notice
delivered by Tenant to Landlord no later than thirty (30) days prior to the expiration of the initial Term,
and only if as of the date of delivery of the notice, Tenant is not in default under this Lease. An Extension
Option may be exercised only by the originally named Tenant or by an assignee or sublessee approved
pursuant to Article X and only if the originally named Tenant or such approved assignee or sublessee is
not in default under the Lease at the time of delivery of notice of exercise and occupies the entire Premises
as of the date it exercises the Extension Option. If Tenant or such approved assignee or sublessee properly
exercises the Extension Option and is not in default at the end of the initial Term, the Term shall be
extended on a month to month basis, terminable by Landlord upon sixty (60) days’ notice to Tenant.
3.3.2 Notice of Termination. Landlord shall have the right to terminate the Lease for any
reason and at Landlord’s sole discretion following the Expiration Date, provided however;
Landlord shall give Tenant a sixty (60) day written notice to terminate.
3.3.3 Extension Term Rent. $24,000.00 per month.
3.3 Extension Term Rent Floor. In no event shall the Rent for the Extension Term be less than the
monthly Base Rent payable during the prior six months under this Lease.
3.4 No Representations. Tenant acknowledges that neither Landlord nor any of Landlord's agents
has made any representation or warranty as to the suitability or fitness of the Premises for the conduct of
Tenant's business, and that neither Landlord nor any of Landlord's agents has agreed to undertake any
alterations or additions or to construct any tenant improvements to the Premises except as expressly
provided in this Lease.
3.5 AS-IS Lease. Tenant acknowledges and agrees that by executing this Lease Tenant shall be
deemed to have approved of all characteristics and conditions of the Premises, the Building and the Real
Property, following its own independent investigation and due diligence, and that Tenant is leasing and
accepting same in its present condition, "AS IS" WHERE IS AND WITH ALL FAULTS, and no present
or latent defect or deficiency in any legal or physical condition thereof, whether or not known or
discovered, shall affect the rights of either Landlord or Tenant hereunder, nor shall Rent be reduced as a
consequence thereof. Without limiting the foregoing, Landlord shall, prior to the Commencement Date,
ensure that the Building's mechanical equipment, plumbing and roof are in working order. Except as
expressly provided herein, Landlord shall have no further obligation to make the Building ready for
Tenant. Without limiting the foregoing, Landlord and Tenant acknowledge that Landlord shall have no
obligation to remove or pay for the removal of flooring and mastic.
3.6 No Right of First Refusal. Nothing contained herein, including without limitation the provisions
of Section 3.5 regarding Tenant's conditional option to extend the Term hereof, is or shall be deemed to
constitute a right of first refusal to purchase the Property from Landlord or to require Landlord to sell the
Property to Tenant, or any other preemptive right in favor of Tenant.
3.7 Notice of Termination. Landlord shall have the right to terminate the Lease for any
reason and at Landlord’s sole discretion following the Expiration Date, provided however;
Landlord shall give Tenant a sixty (60) day written notice to terminate.
ARTICLE IV
RENT, OPERATING EXPENSES, TAXES AND SECURITY DEPOSIT
4.1 Monthly Rent. From and after the Rent Commencement Date, Tenant shall pay to Landlord for
each calendar month of the Term, the monthly Base Rent set forth in Section 1.11, as the same may be
adjusted upon Tenant's exercise of the Extension Option as provided in Section 3.5.2. Each monthly
installment of Base Rent shall be due and payable to Landlord in lawful money of the United States, in
advance, on the first (1st) day of each calendar month during the Term or Extension Term, without
abatement, deduction, claim or offset, and without prior notice, invoice or demand , at Landlord's address
set forth in Section 1.1 or such other place as Landlord may designate from time to time. Tenant's payment
of Base Rent for the first month of the Term shall be delivered to Landlord concurrently with Tenant's
execution of this Lease.
4.2 Prorations. Monthly installments for any fractional calendar month at the beginning or end of
the Term shall be prorated based on the number of days in such month.
4.3 Additional Rent; Triple Net Lease; Property Management Fee. All Additional Rent,
including without limitation, all of Tenant's required payments pursuant to this Article IV, shall be due
and payable to Landlord in lawful money of the United States without abatement, deduction, claim or
offset within twenty (20) days of receipt of Landlord's invoice o r statement for same (or if this Lease
provides another time for the payment of certain items of Additional Rent , then at such other time) at
Landlord's address set forth in Section 1.1 or such other place as Landlord may designate from time to
time. This is a triple net Lease to Landlord. Tenant agrees to pay, without abatement, deduction, claim or
offset, all costs and expenses relating to the Premises or any part thereof, of any kind or nature
whatsoever. Such costs and expenses shall include, without limitation, all amounts attributable to, paid or
incurred in connection with the ownership, operation, repair, restoration, maintenance and management of
the Premises; property taxes and payments in lieu thereof; rent taxes; gross receipt taxes (whether assessed
against Landlord or assessed against Tenant and collected by Landlord, or both); water and sewer charges;
insurance premiums (including earthquake); utilities; refuse disposal; lighting (including outside lighting);
fire-detection systems including monitoring, maintenance and repair; security; janitorial services; labor;
air conditioning and heating; maintenance and repair costs and service contracts; costs of licenses, permits
and inspections; and all other costs and expenses paid or incurred with respect to the Premises or part
thereof.
4.4 Late Charge. Tenant acknowledges that the late payment of Rent will cause Landlord to incur
administrative costs and other damages, the exact amount of which would be impracticable or extremely
difficult to ascertain. Landlord and Tenant agree that if Landlord does not receive any such payment
within five (5) calendar days after such payment is due, Tenant shall pay to Landlord as Additional Rent
an amount equal to five percent (5%) of the overdue amount as a late charge for each month or partial
month that such amount remains unpaid. The Parties acknowledge that this late charge represents a fair
and reasonable estimate of the costs that Landlord will incur by reason of the late payment by Tenant.
Acceptance of any late Rent and late charge therefore shall not prevent Landlord from exercising any of
the other rights and remedies available to Landlord for any other Event of Default under this Lease.
4.5 Taxes. The term "Real Property Taxes" means any form of tax, assessment, charge, license, fee,
rent tax, levy, penalty (if a result of Tenant's delinquency), real property or other tax (other than
Landlord's net income, estate, succession, inheritance, or franchise taxes), now or hereafter imposed with
respect to the Building, the Real Property or any part thereof (including any Alterations), this Lease or any
Rent payable under this Lease by any authority having the direct or indirect power to tax, or by any city,
county, state or federal government or any improvement district or other district or division thereof,
whether such tax or any portion thereof (i) is determined by the area of the Building, the Real Property, or
any part thereof or the Rent payable under this Lease by Tenant, including, but not limited to any gross
income or excise tax levied by any of the foregoing authorities with respect to receipt of Rent due under
this Lease, (ii) is levied or assessed in lieu of, in substitution for, or in addition to, existing or additional
taxes with respect to the Building, the Real Property or any part thereof whether or not now customary or
within the contemplation of Landlord or Tenant, or (iii) is based upon any legal or equitable interest of
Landlord in the Building, the Real Property or any part thereof. Tenant and Landlord intend that all Real
Property Taxes, including without limitation all new and increased assessments, taxes, possessory interest
taxes charged or levied in place of real property taxes, fees, levies, and charges and all similar
assessments, taxes, fees, levies and charges shall be included within the definition of Real Property Taxes"
for purposes of this Lease.
4.5.1 Apportionment of Taxes. If the Building is assessed as part of a larger parcel, then Landlord
shall equitably apportion the Real Property Taxes and reasonably determine the Real Property Taxes
attributable to the Building. If other buildings exist on the assessed parcel, the Real Property Taxes
apportioned to the Building shall be based upon the ratio of the square footage of the Building to the
square footage of all buildings on the assessed parcel. Landlord' s reasonable determination of such
apportionment shall be conclusive.
4.5.2 Tax on Improvements. Notwithstanding anything to the contrary set forth in this Lease, Tenant
shall pay prior to delinquency any and all taxes, fees and charges which are levied or assessed against
Landlord or Tenant: (a) upon Tenant's equipment, furniture, fixtures, improvements and other personal
property located in the Premises, (b) by virtue of any alterations or leasehold improvements made to the
Premises by Tenant, and (c) upon this transaction or any document to which Tenant is a party creating or
transferring an interest or an estate in the Premises. If any such tax, fee or charge is paid by Landlord,
Tenant shall reimburse Landlord for Landlord's payment upon demand.
4.5.3 Real Property Tax Limitation. Notwithstanding the provisions of Section 4.5 Tenant’s increase
of real property tax shall be governed by a maximum adjustment of three percent (3.00%) per annum of
the Real Estate Tax due for fiscal year 2015/2016 assessed against the Real Property. Notwithstanding the
foregoing, Tenant shall pay all taxes assessed which result from water u sage or sewer charge assessment
and assessment against Tenant’s Improvements described in Section 17.2 and Exhibit B of the January 8,
2013 Lease.
Property ownership transfers shall be governed by the same limitation on increases of Tenant’s obligation
to pay Real Property Taxes as stated above.
4.6 Security Deposit. If Tenant fails to pay Rent, or otherwise defaults under the Lease,
Landlord may use, apply or retain all or any portion of said Security Deposit for the payment
of any amount due Landlord or to reimburse or compensate Landlord for any liability, expense,
loss or damage which Landlord may suffer or incur by reason thereof. If Landlord uses or
applies all or any portion of the Security Deposit, Tenant shall within ten (10) days after
written request therefore, deposit monies with Landlord sufficient to resto re said Security
Deposit to the full amount required by this Lease. Landlord shall not be required to keep the
Security Deposit separate from its general accounts.
Within fourteen (14) days after the expiration or termination of this Lease, if Landlord e lects to
apply the Security Deposit only to unpaid Rent, and otherwise within thirty (30) days after the
Premises have been vacated pursuant to Article XIV, Landlord shall return that portion of the
Security Deposit not used or applied by Landlord. No part of the Security Deposit shall be
considered to be held in trust, to bear interest or to be prepayment for any monies to be paid by
Tenant under this Lease. Tenant shall have no right to apply the Security Deposit, or any
portion thereof, to the last month rent due under this Lease.
If Landlord disposes of its interest in the Premises and the Real Property, Landlord may deliver or credit
the Security Deposit to Landlord’s successor in interest to the Premises and Real Property, and thereupon
Landlord shall be relieved of further responsibility with respect to the Security Deposit.
ARTICLE V
USE OF PREMISES
5.1 Permitted Use; Entitlements. The Premises shall be used solely for the purposes set forth in
Section 1.14 and for no other purpose without the written consent of Landlord, which may be granted or
withheld in Landlord's sole discretion. Tenant shall not do or suffer or permit anything to be done in or
about the Premises, the Building or the Real Property, nor bring or keep anything therein that would in
any way subject Landlord to any liability, increase the premium rate of or affect any fire, casualty, rent or
other insurance relating to the Real Property or any of the contents of the Building, or cause a cancellation
of, or give rise to any defense by the insurer to any claim under, or conflict with, any policies for such
insurance. If any act or omission of Tenant results in any such increase in premium rates, Tenant shall pay
to Landlord upon demand the amount of such increase.
5.2 Signage. Tenant shall obtain the prior approval of the Landlord, which approval may be withheld
in Landlord's sole discretion, before placing any sign or symbol on doors or windows or elsewhere in or
about the Premises so as to be visible from the public areas or exterior of the Building, or upon any other
part of the Building or Real Property, including building directories. Any signs or symbols which have
been placed without Landlord's approval may be removed by Landlord. Upon expiration or termination of
this Lease, all signs installed by Tenant shall be removed and any damage resulting therefrom shall be
promptly repaired by Tenant, or such removal and repair may be done by Landlord and the cost charged to
Tenant as Additional Rent. Tenant shall be provided signage as a part of the Building directory.
Tenant is hereby granted the right to place and maintain in place during the Term of this Lease Tenant's
name on the exterior of the Building with lighting. The design of the signage and the lighting shall be
subject to Landlord's approval. Landlord shall determine in its reasonable discretion the position, location
and configuration of Tenant's name on the Building. All signs or lettering shall conform in all respects to
the sign and/or lettering criteria reasonably established by Landlord. All signage shall comply with
regulations promulgated by the City of South San Francisco.
5.3 Compliance with Laws. Tenant shall procure and maintain all governmental approvals, licenses
and permits required for the proper and lawful conduct of Tenant's permitted use of the Premises. Tenant
shall throughout the Term comply with and shall not use the Premises, the Building or the Real Property,
or suffer or permit anything to be done in or about the same which would in any way conflict with any of
the following (collectively "Applicable Laws"): (i) the provisions of all recorded covenants, conditions
and restrictions applicable to the Building or the Real Property, or (ii) any federal, state, county, local or
other governmental agency rules, regulations, statutes, ordinances, orders , standards, requirements or laws
now in force or hereafter enacted, promulgated or issued which are applicable to the Real Property,
Premises, the Building, or the use or occupancy thereof, including without limitation building, zoning, and
fire codes and regulations.
ARTICLE VI
ENVIRONMENTAL MATTERS
6.1 Use of Hazardous Materials. Tenant shall not cause or permit any Hazardous Material to be
generated, brought onto, used, stored, or disposed of in or about the Premises, the Building or the Real
Property by Tenant or Tenant's agents, employees, contractors, subtenants or invitees (collectively
"Tenant Parties"), except for limited quantities of standard office and janitorial supplies. At Tenant's sole
cost and expense, Tenant shall use, store and dispose of all such Hazardous Materials in strict compliance
with all Environmental Laws, and shall in all other respects comply with all Environmental Laws.
6.2 Notice of Release or Investigation. If during the Lease Term (including any extensions), Tenant
becomes aware of (a) any actual or threatened release of any Hazardous Material on, under, or about the
Premises, the Building or the Real Property, or (b) any inquiry, investigation, proceeding, or claim by any
government agency or other person regarding the presence of Hazardous Material on , under, or about the
Premises, the Building, or the Real Property, Tenant shall give Landlord written notice of the release or
investigation within five (5) days after learning of it and shall simultaneously furnish to Landlord copies
of any claims, notices of violation, reports, or other writings received by Tenant that concern the release or
investigation.
6.3 Indemnification. Tenant shall defend (with counsel acceptable to Landlord), indemnify and hold
harmless Landlord and Landlord's elected and appointed officers, officials, employees, agents and
representatives (collectively, "Indemnitees") from and against any and all liabilities, losses, damages,
fines, deficiencies, penalties, claims, demands, suits, actions, causes of action, legal or administrative
proceedings, judgments, costs and expenses (including without limitation reasonable attorneys' fees and
expenses, court costs, expert witness fees and post judgment collection costs) (all of the foregoing,
collectively "Claims") resulting or arising from or in connection with any release of any Haza rdous
Material in or about the Premises, the Building or the Real Property by Tenant, or Tenant's agents,
assignees, sublessees, contractors, or invitees, or any other violation of any Environmental Law by Tenant,
or Tenant's agents, assignees, sublessees, contractors, or invitees. This indemnification includes: (i) losses
attributable to diminution in the value of the Premises or the Building, (ii) loss or restriction of use of
rentable space in the Building, (iii) adverse effect on the marketing of any space in the Building; and (iv)
all other liabilities, obligations, penalties, fines, claims, actions (including remedial or enforcement actions
of any kind and administrative or judicial proceedings, orders, or judgments), damages (including
consequential and punitive damages), and costs (including attorney, consultant, and expert fees and
expenses) resulting from the release or violation. The indemnity provided in this Section shall not extend
to Claims to the extent the same are caused by the gross negligence or willful misconduct of Indemnitees.
The provisions of this Section shall survive the expiration or termination of this Lease.
6.3.1 Landlord's Representations and Warranties. Landlord represents and warrants that Landlord
has received no notice, warning, notice of violation, administrative complaint, judicial complaint, or other
written notice alleging that the Building or the Real Property are in violation of any Environmental Laws
(defined below) or informing Landlord that the Building or the Real Property is subject to investigation or
inquiry concerning Hazardous Materials, nor is Landlord aware of any such violation. In addition , to the
best knowledge of Landlord, there is no pending or threatened litigation, administrative proceeding, or
other legal or governmental action with respect to the Building or the Real Property in connection with the
presence of Hazardous Materials in, on or under the Building or the Real Property. Whenever used in this
Agreement, the phrase "to the best knowledge of Landlord" shall mean the actual knowledge of Landlord'
s Facilities Services Manager. Without limiting the foregoing, Landlord and Tenant acknowledge that
Landlord shall have no obligation to remove or pay for the removal of flooring and mastic. If, howe ver;
Hazardous Substances other than flooring and mastic are determined to be present on the Real Property as
of the Effective Date of the Lease, and remedial action is required in relation to the particular Hazardous
Substances because a federal, state, or local government agency is requiring such remedial action, then
Tenant shall have no responsibility for the cost of any required or necessary repair, cleanup or
detoxification or decontamination of any of the Premises, or the preparation and implementati on of any
closure, remedial action or other required plans in connection therewith (collectively, “Remediation”);
provided, however, that Tenant shall provide without charge to Landlord or the applicable party or parties,
unfettered access to the Real Property and the Premises for purposes of such Remediation.
6.4 Remediation Obligations. If the presence of any Hazardous Material brought onto the Premises
or the Building by Tenant or Tenant' s employees, agents, contractors, or invitees results in contamination
of the Building, Tenant shall promptly take all necessary actions to remove or remediate such Hazardous
Materials, whether or not they are present at concentrations exceeding state or federal maximum
concentration or action levels, or any governmental agency has issued a cleanup order, at Tenant's sole
expense, to return the Premises and the Building to the condition that existed before the introduction of
such Hazardous Material. Tenant shall first obtain Landlord's approval of the proposed r emoval or
remedial action. This provision does not limit the indemnification obligation set forth in Section 6.3.
6.5 Definition of Hazardous Material. As used in this Lease, the term "Hazardous Material" means
any hazardous or toxic substance, material, or waste at any concentration that is or becomes regulated by
the United States, the State of California, or any government authority having jurisdiction over the
Building. Hazardous Material includes: (a) any "hazardous substance," as that term is defined in the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA) (42
United States Code sections 9601-9675); (b) "hazardous waste," as that term is defined in the Resource
Conservation and Recovery Act of 1976 (RCRA) (42 United States Code sections 6901-6992k); (c) any
pollutant, contaminant, or hazardous, dangerous, or toxic chemical, material, or substance, within the
meaning of any other applicable federal, state, or local law, regulation, ordinance, or requirement
(including consent decrees and administrative orders imposing liability or standards of conduct concerning
any hazardous, dangerous, or toxic waste, substance, or material, now or hereafter in effect); (d) petroleum
products; (e) radioactive material, including any source, special nuclear, or byproduct material as defined
in 42 United States Code sections 2011-2297g-4; (f) asbestos in any form or condition; and (g)
polychlorinated biphenyls (PCBs) and substances or compounds containing PCBs.
6.6 Definition of Environmental Laws. As used in this Lease, the term "Environmental Laws"
means all federal, state and local laws, ordinances, regulations, rules orders and directives pertaining to
Hazardous Materials, including without limitation, the laws, statutes, and regulations cited in the
preceding Section 6.5, as any of the foregoing may be amended from time to time.
6.7 Environmental Reports. Landlord shall provide to Tenant copies of all studies, reports and
investigations concerning the environmental condition of the Building and the Real Property which were
prepared within the past five years and which are in Landlord’s possession.
ARTICLE VII
UTILITIES AND SERVICES
7.1. Utility Services. Tenant shall contract and pay for all utility services ("Utility Services"),
including, without limitation, the following: (i) electricity for Building lighting and power suitable for use
of the Premises for ordinary retail store and veterinary service purposes; (ii) air conditioning and heating;
and (iii) water for drinking, lavatory and veterinary service purposes.
7.2 Maintenance Services and Repairs. Tenant shall be responsible for all interior and exterior
maintenance of the Premises, the Building and the Real Property (collectively, “Maintenance Services”),
including, without limitation: (i) maintenance of all exterior areas of the Building and the Real Property,
including without limitation, lighting and landscaping; (ii) cleaning, painting, maintenance and repair of
the Building exterior, (iii) maintenance and repair of the Building mechanical, electrical, HVAC and
plumbing equipment and systems (excepting below grade plumbing from the street connection to the
building exterior wall foundation) and the Building structural components including the roof, foundation,
floors and non-load bearing walls (excepting therefrom damage caused by natural disaster not including
fire or an insured peril and damage to structural components existing as of January 8, 2013), (iv)
maintenance of all areas of the Building and the Real Property including parking lots, walkways,
driveways, fences, utility systems, fire sprinklers, corridors, restrooms, windows; (v) supply of public area
lamp replacement, (vi) provision of exterior window washing with reasonable frequency, b ut in no event
less than two (2) times per year; and (vii) provision of janitorial services to the common areas (“Janitorial
Services”). Without limiting the foregoing, Tenant shall be responsible for janitorial service to the
Premises and interior window cleaning.
Tenant shall, at all time during the Term of this Lease, at Tenant's sole expense, keep the Premises
(including all tenant improvements, Alterations, fixtures and furnishings) in good order, repair and
condition at all times during the Term. Subject to Landlord's prior approval and within any reasonable
period specified by Landlord, Tenant shall, at Tenant's sole expense, promptly and adequately repair all
damage to the Premises and replace or repair all damaged or broken fixtures and other leasehold
improvements. If Tenant fails to maintain or keep the Premises in good repair or if such failure results in a
nuisance or health or safety risk, at Landlord's option, Landlord may perform any such required
maintenance and repairs and within ten days after receipt of Landlord's invoice therefor, Tenant shall pay
Landlord' s costs incurred in connection with such repairs, plus a percentage of such costs sufficient to
reimburse Landlord for all overhead, general conditions, fees and other costs and expenses in connection
therewith. Landlord’s reimbursement of overhead, general conditions, fees and costs shall be a percentage
of costs incurred by Landlord pursuant to this Section 7.2 which said percentage shall be fixed at ten
(10.00%) percent of the costs of repair or maintenance incurred by Landlord.
7.3 Waiver. Tenant hereby waives the provisions of Sections 1941 and 1942 of the California Civil
Code and any other present or future law permitting repairs by a tenant at the expense of a landlord or
termination of a lease by reason of the condition of the leased premises.
7.4 Compliance with Applicable Laws. Landlord and Tenant shall each comply with (and shall
cause their respective employees, agents and contractors to comply with) all Applicable Laws, including
without limitation all Environmental Laws, whenever either party undertakes any work of construction,
alteration or improvement in the Premises or the Building.
ARTICLE VIII
ALTERATIONS AND ADDITIONS
8.1 Alterations and Improvements. Tenant may not make any improvements, alterations, additions
or changes to the Premises ("Alterations") without the prior written approval of Landlord, which approval
shall not be unreasonably withheld or delayed. Any such Alterations shall be done at Te nant's expense, in
a good and workmanlike manner conforming in quality and design with the Premises existing as of the
Commencement Date, by a licensed contractor reasonably approved by Landlord, in conformity with
plans and specifications reviewed and approved by Landlord, and in compliance with all Applicable Laws.
Tenant shall obtain all necessary governmental approvals and permits for such Alterations. Tenant shall
give Landlord not less than ten (10) business days' notice prior to the commencement of construction so
that Landlord may post a notice of non-responsibility on the Premises. Notwithstanding any other
provisions in this Lease, unless Landlord otherwise agrees in writing, Tenant shall remove, prior to
expiration of the Term and at Tenant's sole cost and expense, any and all wires, cables and related
telecommunications devices installed by or on behalf of Tenant, and Landlord may at its option by written
notice to Tenant, require that Tenant, upon the expiration or sooner termination of this Lease, at Tenant's
expense, remove any or all other Alterations and return the Premises to its condition as of the
Commencement Date, normal wear and tear excepted; provided, however, Tenant shall have no obligation
to remove the initial Tenant Improvements constructed pursuant to Exhibit B of the January 8, 2013 Lease
upon expiration of the Term of this Lease. Notwithstanding the improvements and alternations pursuant to
those described in Exhibit B of the January 8, 2013 Lease, Tenant shall not make any Alterations that: (i)
affect the exterior of the Building, (ii) affect any of the structural portions of the Building, including
without limitation, the roof, (iii) require any change to the basic floor plan of the Premise or any change to
the structural or mechanical components of the Premises, (iv) diminish the value of the Premises, (v)
result in an increase in the demand for any utilities or services that Landlord is required to provide, (vi)
cause an increase in the premiums for hazard or liability insurance carried by Landlord, or (vii) overload
the floor load capacity or unduly burden the plumbing, heating, ventilation, air conditioning, electrical or
other basic systems that serve the Building. Upon completion of any Alteration, Tenant shall (a) cause a
timely notice of completion to be recorded in the official records of San Mateo County in accordance with
Civil Code Section 3093 or any successor statute, and (b) deliver to Landlord evidence of full payment
and unconditional final waivers of all liens for labor, services, or materials.
8.2 Liens. Tenant shall not permit any mechanics' materialmen's or other liens, to be filed against the
Building or the Real Property or against Tenant's leasehold interest in the Premises. Landlord has the right
at all times to post and keep posted on the Premises any notice that it considers necessary for protection
from such liens. If Tenant fails to cause the release of record of any lien(s) filed against the Prem ises or
Tenant's leasehold estate therein, by payment or posting of a proper bond within ten (10) days from the
date of the lien filing(s), then Landlord may, at Tenant's expense, cause such lien(s) to be released by any
means Landlord deems proper, including but not limited to payment of or defense against the claim giving
rise to the lien(s). All sums reasonably disbursed, deposited or incurred by Landlord in connection with
the release of the lien(s), including but not limited to all costs, expenses and attorney's fees, shall be due
and payable by Tenant to Landlord as Additional Rent on demand by Landlord.
ARTICLE IX
INSURANCE AND INDEMNITY
9.1 Indemnity. To the fullest extent permitted by law, Tenant shall defend (with counsel reasonably
acceptable to Landlord), indemnify and hold Indemnitees harmless from and against any and all Claims
arising out of or relating directly or indirectly to this Lease or the Premises (including without limitation,
Claims for or relating to loss of or damage to property, injury or death of any person or animal), including
any Claim arising from or in connection with or in any way attributable to: (i) the use or occupancy, or
manner of use or occupancy of the Premises, the Building or the Real Property by Tenant or the Tenant
Parties, (ii) any act, error, omission or negligence of Tenant Parties or any invitee, guest or licensee of
Tenant in, on or about the Real Property, (iii) any Alterations, (iv) construction of any Tenant
Improvements , (v) work performed pursuant to Section 7.2 above, and (vi) any activity, work, or thing
done, omitted, permitted, allowed or suffered by Tenant or Tenant Parties in, at, or about the Premises, the
Building or the Real Property, except to the extent caused by the gross negligence or willful conduct of
Landlord. The provisions of this section shall not be construed or interpreted as in any way restricting,
limiting or modifying Tenant’s insurance obligations under this Lease. Tenant's compliance with the
insurance requirements set forth in this Lease shall not in any way restrict, limit or modify Tenant's
indemnification obligations hereunder. The provisions of this section shall survive the expiration or earlier
termination of this Lease.
9.2 Tenant's Insurance. Tenant shall, at its sole expense, procure and maintain throughout the Term
(plus such earlier and later periods as Tenant may be in occupancy of the Premises) all of the following:
(a) Commercial general liability insurance including contractual liability coverage, written on
an "occurrence" policy form, covering bodily injury, property damage and personal injury arising out of or
relating (directly or indirectly) to Tenant's operations, conduct, assumed liabilities, or use or occupancy of
the Premises, the Building or the Real Property naming the Indemnitees as additional insureds, with
minimum coverage in the amount of Two Million Dollars ($2,000,000) per occurrence combined single
limit for bodily injury and property damage and Five Million Dollars ($5,000,000) in the aggregate.
(b) Property insurance protecting Tenant against loss or damage by fire and such other risks
as are insurable under then available standard forms of "all risk" insurance policies, covering Tenant's
personal property and trade fixtures in or about the Premises or the Real Property, and any improvements
and/or Alterations in the Premises, in an amount not less than one hundred percent (100%) of their actual
replacement cost or highest insurable value.
(c) Workers’ compensation insurance that satisfies the minimum statutory limits.
(d) If Tenant operates owned, leased or non-owned vehicles on the Real Property,
comprehensive automobile liability insurance with a minimum coverage of one million dollars
($1,000,000) per occurrence, combined single limit.
(e) The foregoing policies shall protect Tenant as named insured, and Landlord and the other
Indemnitees as additional insureds, and if subject to deductibles shall provide for deductible amounts not
in excess of those approved in advance in writing by Landlord in its reasonable discretion. Landlord
reserves the right to increase the foregoing amount of required liability coverage from time to time (but
not more often than once each calendar year) to adequately protect Indemnitees and to require that Tenant
cause any of its contractors, vendors or other parties conducting activities in or about or occupying the
Premises to obtain and maintain insurance as determined by Landlord and as to which the Indemnitees
shall be additional insureds. All insurance policies shall be written on an occurrence basis. If the Tenant’s
insurance policy includes a self-insured retention that must be paid by a named insured as a precondition
of the insurer’s liability, or which has the effect of providing that payments of the self-insured retention by
others, including additional insureds or insurers do not serve to satisfy the self-insured retention, such
provisions must be modified by special endorsement so as to not apply to the additional insured coverage
required by this Lease so as to not prevent any of the Parties to this agreement from satisfying or paying
the self-insured retention required to be paid as a precondition to the insurer’s liability. Additionally, the
certificates of insurance must note whether the policy does or does not include any self-insured retention
and also must disclose the deductible. The certificates shall contain a statement of obligation on the part of
the carrier to notify City of any material change, cancellation, termination or non-renewal of the coverage
at least thirty (30) days in advance of the effective date of any such material change, cancellation,
termination or non-renewal. The City’s Risk Manager may waive or modify any of the insurance
requirements of this section.
9.3 Excess Coverage Liability Policy. Nothing in this Article IX shall prevent Tenant from
obtaining insurance of the kind and in the amounts provided for under this Section under an excess
coverage liability insurance policy covering other properties as well as the Premises; provided, howe ver,
that any such policy of excess coverage liability insurance (i) shall specify those amounts of the total
insurance allocated to the Premises, which amounts shall not be less than the amounts required by Section
9.2, (ii) such amounts so specified shall be sufficient to prevent anyone of the insureds from becoming a
co-insurer within the terms of the applicable policy, and (iii) shall, as to the Premises, otherwise comply
with the requirements of this Article as to endorsements and coverage.
9.3.1 Self-Insurance. Any insurance required to be maintained by the Tenant pursuant to this Lease
may be maintained under a plan of self-insurance through a wholly-owned subsidiary of Tenant's parent
company which specializes in providing such coverage for T enant's parent company and its subsidiaries,
provided that Tenant' s parent company's net worth exceeds One Hundred Million Dollars ($100,000,000).
Tenant agrees that if Tenant elects to self-insure, Landlord shall have the same benefits and protections as
if Tenant carried insurance with a third-party insurance company satisfying the requirements of this Lease
(including without limitation, waive of subrogation provisions).
9.4. Policy Form. Each insurance policy required pursuant to Section 9.2 shall be issued by an
insurance company licensed in the State of California and with a general policyholders' rating of "A+" or
better and a financial size ranking of "Class VIII" or higher in the most recent edition of Best's Insurance
Guide. Each insurance policy, other than Tenant's workers' compensation insurance, shall (i) provide that
it may not be cancelled, materially changed, terminated, or allowed to lapse unless thirty (30) days' prior
written notice to Landlord is first given; (ii) provide that no act or omission of Tenant shall affect or limit
the obligations of the insurer with respect to any other insured; (iii) include all waiver of subrogation
rights endorsement necessary to effect the provisions of Section 9.6: and (iv) provide that the policy an d
the coverage provided shall be primary, that Landlord, although an additional insured, shall nevertheless
be entitled to recovery under such policy for any damage to Landlord or the other Indemnitees by reason
of acts or omission of Tenant, and that any coverage carried by Landlord shall be noncontributory with
respect to policies carried by Tenant. A certificate evidencing each insurance policy shall be delivered to
Landlord by Tenant on or before the Commencement Date, and thereafter Tenant shall deliver to Landlord
renewal policies or certificates at least thirty (30) days prior to the expiration dates of expiring policies. If
Tenant fails to procure such insurance or to deliver such certificates to Landlord, and such failure
continues five (5) business days after notice thereof from Landlord to Tenant, Landlord may, at its option,
procure the same for Tenant's account, and the cost thereof shall be paid to Landlord by Tenant upon
demand.
9.5 Insurance of Tenant's Contractors and Agents. In addition to any other insurance
requirements, Tenant expressly agrees that none of its agents, contractors, workmen, mechanics, suppliers
or invitees performing construction or repair work in the Premises shall commence such work unless and
until each of them shall furnish Landlord with satisfactory evidence of insurance coverage, financial
responsibility and appropriate written releases of mechanic's or materialmen's lien claims, as necessary.
9.6 Waiver of Subrogation. Tenant and Landlord to cause the insurance companies issuing their
respective property (first party) insurance to waive any subrogation rights that those companies may have
against Tenant or Landlord, respectively, as long as the insurance is not invalidated by the waiver. If the
waivers of subrogation are contained in their respective insurance policies, Landlord and Tenant waive
any right that either may have against the other on account of any loss or damage to their respective
property to the extent that the loss or damage is insured under their respective insurance policies.
9.7 Landlord's Insurance. Landlord maintains a program of self-insurance comparable to or
exceeding the coverage and amounts of insurance carried by reasonably prudent landlords of comparable
buildings and workers' compensation coverage as required by law. If Landlord so chooses, Landlord may
maintain "Loss of Rents" insurance, insuring that the Rent will be paid in a timely manner to Landlord for
a period of at least twelve (12) months if the Premises or the Building or any portion thereof are destroyed
or rendered unusable or inaccessible by any cause insured against under this Lease.
ARTICLE X
ASSIGNMENT AND SUBLETTING
10.1 Landlord's Consent Required. Tenant shall not directly or indirectly, voluntarily or
involuntarily, by operation of law or otherwise, assign, mortgage, pledge, encumber or otherwise transfer
this Lease, or permit all or any part of the Premises to be Leased or used or occupied for any purpose by
anyone other than Tenant without the prior written consent of Landlord, which consent shall not be
unreasonably withheld, delayed or conditioned. Any assignment or Lease without Landlord’s prior written
consent shall, at Landlord’s option, be void and shall constitute an Event of Default entitling Landlord to
terminate this Lease and to exercise all other remedies available to Landlord under this Lease and at law.
Notwithstanding anything to the contrary contained herein, Tenant shall be permitted to assign this Lease
and to sublet the Premises in whole or in part to any Affiliate of Tenant without Landlord consent
("Permitted Transfer").
10.2 Basis for Withholding Consent. Landlord agrees that it will not unreasonably withhold, delay or
condition its consent to Tenant's assigning this Lease or subletting the Premises. In addition to other
reasonable bases, Tenant hereby agrees that Landlord shall be deemed to be reasonable in withholding its
consent if: (i) there exists an Event of Default (as defined in Section 16.1) at the time of request for
consent or on the effective date of such subletting or assigning; (ii) the proposed subtenant or assignee
seeks to use any portion of the Premises for a use not consistent with other uses i n the Building, or is
financially incapable of assuming the obligations of this Lease; (iii) the assignment or subletting would
materially increase the operating costs for the Building; (iv) the assignment or subletting may conflict with
the terms of any easement, covenant, condition or restriction or other agreement affecting the Real
Property; or (vi) the assignment or Lease would involve a change in use from that expressly permitted
under this Lease.
Tenant shall submit to Landlord the name of a proposed assignee or subtenant, the terms of the proposed
assignment or subletting, the nature of the proposed subtenant's or assignee's business, and such
information as to the assignee's or subtenant's financial responsibility and general reputation as Landlor d
may reasonably require.
10.3 No Release of Obligations. The consent by Landlord to an assignment or subletting hereunder
shall not relieve Tenant or any assignee or subtenant from the requirement of obtaining Landlord's express
prior written consent to any other or further assignment or subletting. No subtenant may assign its Lease,
or further sublet its Leased premises, without Landlord's prior written consent, which consent may be
withheld in Landlord's sole discretion. Neither an assignment or subletting nor the collection of rent by
Landlord from any person other than Tenant shall be deemed a waiver of any of the provisions of this
Article or release Tenant from its obligations to comply with this Lease, and Tenant shall remain fully and
primarily liable for all of Tenant's obligations under this Lease.
10.4 Permitted Assignment to Affiliates. Provided that no Event Default, or event which with the
passage of time or the giving of notice would constitute an Event of Default, exists under this Lease,
Tenant may, without Landlord's consent, assign or sublet all or a portion of this Lease or the Premises to
an Affiliate of Tenant or to any non-Affiliated entity with which Tenant merges or which purchases
substantially all of the assets of Tenant, if (i) Tenant notifies Landlord at least fifteen (15) days prior to
such assignment or Lease; and (ii) the transferee assumes and agrees in a writing reasonably acceptable to
Landlord to perform Tenant's obligations under this Lease and to observe all terms and conditions of this
Lease.
10.5 Administrative Costs of Assignment Transaction. In connection with any request by Tenant
for approval of an assignment or Lease other than a Permitted Transfer, Tenant shall pay Landlord's then
standard reasonable processing fee, any taxes or other charges imposed upon Landlord or the Real
Property as a result of such assignment or Lease, and shall reimburse Landlord for all reasonable costs,
including the reasonable fees of attorneys consulted by Landlord in connection with such assignment or
Lease, whether or not such proposed assignment or Lease is consented to by Landlord.
ARTICLE XI
DAMAGE AND DESTRUCTION
11.1 Repair and Restoration; Termination Rights. If all or part of the Premises is damaged by fire
or other casualty, or if the Building is so damaged that access to or use and occupancy of the Premises is
materially impaired, within forty-five (45) days of the date of the damage, Landlord shall notify Tenant of
the estimated time, in Landlord's reasonable judgment, required for repair or restoration ("Repair Period").
If the estimated time is one hundred eighty (180) days or less, Landlord shall proceed promptly and
diligently to repair or restore the Premises or the portion of the Building necessary for Tenant's
occupancy, and this Lease shall remain in effect, except that for the time unusable, Tenant shall receive a
Rent abatement for that part of the Premises rendered unusable in the conduct of Tenant's business. If the
estimated time for repair or restoration is in excess of one hundred eighty(180) days from the date of the
casualty, either Party, at its option exercised by written notice to other Party within sixty (60) days after
the date of the casualty, may terminate this Lease as of the date specified by Landlord or Tenant in the
notice, which date shall be not less than twenty-five (25) nor more than forty-five (45) days after the date
such notice is given, and this Lease shall terminate on the date specified in the notice. In the event that
neither Party elects to terminate this Lease, Landlord shall commence to timely repair the damage, in
which case this Lease shall continue in full force and effect. In either case, if Landlord fails to repair the
damage by the date that is forty-five (45) days after the end of the Repair Period, then Tenant may give
notice terminating this Lease to Landlord, within ten (10) business days after the forty-five (45) days after
the end of the Repair Period. Termination of the Lease shall be effective as of the date specified in
Tenant's termination notice, which date shall not be earlier than thirty (30) days after the date of Tenant's
termination notice. However, if Landlord repairs the damage for which it is responsible within thirty (30)
days after receipt of Tenant's termination notice, Landlord may elect to nullify Tenant's termination notice
(and thereupon this Lease shall continue in full force and effect) by Landlord's notice of such repair and
election given to Tenant on or prior to the expiration of such thirty (30) day period.
11.2 Damage Near End of Term. Notwithstanding anything to the contrary set forth in this Article, if
the Premises or Building are damaged, such that the Premises or Building cannot be used for the
purpose for which it is Leased for more than thirty (30) days during the last twelve (12) months
of the Term, including any Extension Term, Landlord and Tenant shall each have the option to terminate
this Lease by giving written notice to the other of the exercise of that option within thirty (30) days after
the damage or destruction, and this Lease shall terminate as of the date specified in such notice which
shall be not before the date of such notice nor more than thirty (30) days after the date of such notice.
11.3 Rent Apportionment. If Landlord or Tenant elects to terminate this Lease under this Article XI,
Tenant shall pay Rent, prorated on a per diem basis and paid up to the date of the casualty. If the Premises
are wholly untenantable and this Lease is not terminated, Rent shall abate on a per diem basis from the
date of the casualty until the Premises are ready for occupancy by Tenant. If part of the Premises are un-
tenantable, Rent shall be prorated on a per diem basis and abated in proportion to the portion of the
Premises which is unusable until the damaged part is ready for Tenant's occupancy. Notwithstanding the
foregoing, if any damage was caused by the gross negligence or willful misconduct of Tenant, its
employees or agents, then, in such event, Tenant agrees that Rent shall not abate or be diminished.
11.4 Waiver of Statutory Provisions. The provisions of this Lease, including those in this Article XI,
constitute an express agreement between Landlord and Tenant that applies in the event of any damage to
the Premises, Building, or Real Property. Tenant therefore, fully waives the provisions of any statute or
regulation, including California Civil Code sections 1932(2) and 1933(4) or any successor statute, relating
to any rights or obligations concerning any such casualty.
.
ARTICLE XII
CONDEMNATION
12.1 Total Taking -Termination. If title to the Premises or so much thereof is taken through the
exercise of any government power (by legal proceedings or otherwise) by any public or quasi-public
authority or by any other party having the right of eminent domain, or by a voluntary sale or transfer either
under threat of exercise of eminent domain or while legal proceedings for eminent domain are pending so
that reconstruction of the Premises will not result in the Premises being reasonably suitable for Tenant's
continued occupancy for the uses and purposes permitted by this Lease, this Lease shall terminate as of
the date possession of the Premises or part thereof is so taken.
12.2 Partial Taking. If any part of the Premises is taken through the exercise of eminent domain (or is
voluntarily conveyed under the threat thereof) and the remaining part is reasonably suitable for Tenant's
continued occupancy for the uses and purposes permitted by this Lease, this Lease shall as to the part so
taken terminate as of the date that possession of such part of the Premises is taken and the Rent shall be
reduced in the same proportion that the floor area of the portion of the Premises taken (less any addition
thereto by reason of any reconstruction) bears to the original floor area of the Premises as reasonably
determined by Landlord or Landlord's architect. Landlord shall, at its own cost and expense, make all
necessary repairs or alterations to the Premises so as to make the portion of the Premises not taken a
complete unit.
12.3 No Apportionment of Award. All condemnation awards and similar payments shall be paid and
belong to Landlord, except for any amounts awarded or paid specifically to Tenant for leasehold
improvements, removal and reinstallation of Tenant's trade fixtures and personal property, Tenant's
moving costs and Tenant's goodwill. It is expressly understood and agreed by Tenant that except as
otherwise stated in this section, Landlord shall be entitled to the entire award for any partial or total
taking.
12.4 Temporary Taking. No temporary taking of the Premises (which shall mean a taking of all or
any part of the Premises for one hundred eighty (180) days or less) shall terminate this Lease or give
Tenant any right to any abatement of Rent. Any award made to tenant by reason of such temporary taking
shall belong entirely to Tenant, and Landlord shall not be entitled to share therein.
ARTICLE XIII
SUBORDINATION AND ESTOPPEL
13.1 Estoppel Certificate. From time to time and within fifteen (15) days after request by Landlord,
Tenant shall execute and deliver a certificate to any proposed lender or purchaser, or to Landlord,
certifying, with any appropriate exceptions, (a) that this Lease is in full force and effect without
modification except as noted, (b) the amount, if any, of prepaid rent and deposits paid by Tenant to
Landlord (and not returned to Tenant), (c) the nature and kind of concessions, rental or otherwise, if any,
which Tenant has received or is entitled to receive, (d) that, to Tenant's knowledge, Landlord has
performed all of its obligations due to be performed under this Lease and that there are no defenses,
counterclaims, deductions or offsets outstanding or other excuses for Tenant's performance under this
Lease as of such date, and (e) any other fact reasonably requested by Landlord or such proposed lender or
purchaser.
13.2 Subordination and Attornment. Tenant agrees that this Lease is subject and subordinate to (i)
the lien of any mortgage, deed of trust or other encumbrance of the Building or the Real Property, (ii) all
present and future ground or underlying leases of the Building or Real Property now or hereafter in force
against the Building or Real Property, and (iii) all renewals, extensions, modifications, consolidations, and
replacements of the items described in clauses (i) and (ii), provided that the mortgagee or beneficiary
thereunder agrees that so long as no Event of Default exists, (a) Tenant 's possession of the Premises and
rights and privileges under this Lease shall not be diminished or interfered with by such mortgagee or
beneficiary during the term of this Lease or any extensions or renewals hereof, and (b) such mortgagee or
beneficiary or lessor will not join Tenant as party for the purpose of terminating or otherwise affecting
Tenant's interest in this Lease in any action of foreclosure or other proceeding to enforce any rights arising
out of any default under any mortgage or deed of trust.
13.3 Subordination Agreement. The subordination described in this Article XIII is self-operative,
and no further instrument of subordination shall be required to make it effective. To confirm this
subordination, however, Tenant shall, within fifteen (15) days after Landlord's request, execute any
further instruments or assurances in recordable form that Landlord reasonably considers necessary to
evidence or confirm the subordination of this Lease to any such encumbrances or underlying leases,
provided that that any such instrument provides that the mortgagee or the beneficiary agrees that so long
as no Event of Default exists, (a)Tenant's possession of the Premises and rights and privileges under this
Lease shall not be diminished or interfered with by such mortgagee or beneficiary during the term of this
Lease or any extensions or renewals hereof, and (b) such mortgagee or beneficiary will not join Tenant as
party for the purpose of terminating or otherwise affecting Tenant's interest in this Lease in any action of
foreclosure or other proceeding to enforce any rights arising out of any default under any mortgage or
deed of trust. Tenant shall have no obligation to execute any instrument subordinating its rights hereunder
to the lien of any mortgage or deed of trust unless such instrument contains the foregoing conditions.
Tenant's failure to execute and deliver such instrument(s) shall constitute a default under this Lease.
13.4 Attornment. Tenant covenants and agrees to attorn to the transferee of Landlord's interest in the
Real Property or the Building by foreclosure, deed in lieu of foreclosure, exercise of any remedy provided
in any encumbrance or underlying lease affecting the Building or the Real Property, or operation of law
(without any deductions or setoffs), if requested to do so by the transferee, and to recognize the transferee
as the lessor under this Lease. The transferee shall not be liable for any acts, omissions, or defaults of
Landlord that occurred before the sale or conveyance other than acts, omissions or defaults that are
continuing upon transferee's acquisition of the Real Property and Transferee fails to cure the same after
receiving notice thereof.
13.5 Notice of Default; Right to Cure. Tenant agrees to give written notice of any default by
Landlord to the holder of any encumbrance or underlying lease affecting the Building or the Real
Property, provided that Tenant has received written notice of the name and address of such encumbrance
holder or lessor. Tenant agrees that, before it exercises any rights or remedies under the Lease, the
lienholder or lessor shall have the right, but not the obligation, to cure the default within the same time, if
any, given to Landlord to cure the default, plus an additional thirty (30) days. Tenant agrees that this cure
period shall be extended by the time (not to exceed an additional sixty (60) days) necessary for the
lienholder to begin foreclosure proceedings and to obtain possession of the Building or Real Property, as
applicable.
13.6 Non-disturbance. Landlord agrees to use commercially reasonable efforts to obtain from the
holder of any existing and future indebtedness secured by the Building, a subordination, non-disturbance
and attornment agreement which provides that in the event of foreclosure or transfer in lieu of foreclosure,
so long as no default by Tenant has occurred under this Lease and remains uncured beyond any applicable
cure period (i) Tenant shall not be named or joined in any proceeding that may be instituted to foreclose or
enforce the mortgage unless such joinder is legally required to perfect such proceeding, and (ii) Tenant's
possession and use of the Premises in accordance with the provisions of the Lease shall not be affected or
disturbed by reason of the subordination to or any modification of or default under the mortgage.
ARTICLE XIV
SURRENDER OF PREMISES; HOLDING OVER
14.1 Surrender of Premises. On expiration of this Lease, Tenant shall surrender the Premises in the
same condition as when the Term commenced, ordinary wear and tear excepted. Except for furniture,
equipment and trade fixtures (other than those which are affixed to the Premises so that they cannot be
removed without material damage to the Premises) all alterations, additions or improvements, whether
temporary or permanent in character, made in or upon the Premises, either by Landlord or Tenant, shall be
Landlord's property and at the expiration or earlier termination of the Lease shall remain on the Premises
without compensation to Tenant; provided that, upon reasonable written request of Landlord, Tenant shall,
at its expense and without delay, remove any alterations, additions or improvements (including, without
limitation, all telecommunications equipment and cabling, and all alterations and improvements made by
Tenant after the Commencement Date) made to the Premises by Tenant and designated by Landlord to be
removed, and shall repair any damage to the Premises or the Building caused by such removal. If Tenant
fails to complete any removal required by this section or to repair the Premises, Landlord may complete
such removal and repair, and Tenant shall reimburse Landlord therefor. If Tenant fails to remove such
property as required under this Lease, Landlord may dispose of such property in its sole discretion without
any liability to Tenant, and further may charge the cost of any such disposition to Tenant.
14.2 Hold Over Tenancy. If Tenant remains in possession of the Premises after the expiration or
earlier termination of this Lease with Landlord's written consent, Tenant shall be deemed, at Landlord's
option, to occupy the Premises as a tenant from month-to-month. During such tenancy (and prior to any
termination by Landlord), Tenant agrees to pay Landlord, monthly in advance, an amount equal to: (a)
during the first ninety (90) days of such tenancy at the Base Rent which would become due during the last
month of the Term, together with all other amounts payable by Tenant to Landlord under this Lease, and
(b) for any period following the first ninety (90) days of such tenancy, One Hundred Fifty Percent (150%)
of all Base Rent which would become due during the last month of the Term, together with all other
amounts payable by Tenant to Landlord under this Lease. Except as provided in the preceding sentence,
such month-to-month tenancy shall be on the same terms and conditions of this Lease except that any
renewal options, expansion options, rights of first refusal or any other rights or options pertaining to
additional space in the Building contained in this Lease shall be deemed to be terminated and shall be
inapplicable thereto. Landlord's acceptance of rent after such holding over with Landlord's written consent
shall not result in any other tenancy or in a renewal of the initial term of this Lease.
If Tenant remains in possession of the Premises after the expiration or earlier termination of this Lease
without Landlord's written consent, Tenant's continued possession shall be on the basis of a tenancy at
sufferance and Tenant shall pay monthly Rent during the holdover period in an amount equal to two
hundred percent (200%) of all Base Rent which would become due the last month of the Term, together
with all other amounts payable by Tenant to Landlord.
14.3 Notice of Termination. Landlord shall have the right to terminate the Lease for any
reason and at Landlord’s sole discretion following the Expiration Date, provided however;
Landlord shall give Tenant a sixty (60) day written notice to terminate.
ARTICLE XV
LANDLORD'S RESERVED RIGHTS.
15.1 Rights Reserved to Landlord. Without notice and without liability to Tenant, and without
affecting an eviction or disturbance of Tenant's use or possession, Landlord shall have the right to (i) grant
utility easements or other easements in, or subdivide or make other changes in the legal status of the Land,
the Building or the Real Property as Landlord shall deem appropriate in its sole discretion, provided such
changes do not substantially interfere with Tenant's use of the Premises for the Permitted Use; (ii) enter
the Premises at reasonable times and with reasonable advance notice (and at any time in the event of an
emergency), to inspect (including inspections by prospective lenders for or buyers of the Real Property),
or repair the Premises or the Building and to perform any acts related to the safety, protection, re-letting,
sale or improvement of the Premises or the Building; (iii) install and maintain signs on and in the Building
and the Real Property; and (iv) make such rules and regulations as, in the reasonable judgment of
Landlord, may be needed from time to time for the safety of the tenants, the care and cleanliness of the
Premises, the Building and the Real Property and the preservation of good order therein. Landlord shall at
all times retain a key with which to unlock all of the doors in the Premises, except Tenant's vaults and
safes. If an emergency necessitates immediate access to the Premises, Landlord may use whatever force is
necessary to enter the Premises and any such entry to the Premises shall not constitute a forcible or
unlawful entry into the Premises, a detainer of the Premises or an eviction of Tenant from the Premises or
any portion thereof.
ARTICLE XVI
DEFAULT AND REMEDIES
16.1 Tenant's Default. It shall be an "Event of Default" hereunder if Tenant shall:
(a) fail to pay when due any monthly installment of Rent (or , if applicable under this Lease,
Operating Expenses), or fail to pay any other amount owed by Tenant to Landlord under this
Lease as and when due and such failure continues for five (5) days following written notice
thereof to Tenant by Landlord;
(b) fail to provide any certificate, instrument or assurance as required pursuant to Article IX if
the failure continues for five (5) days after written notice of the failure from Landlord to Tenant;
(c) make a general assignment for the benefit of its creditors or file a petition for bankruptcy
or other reorganization, liquidation, dissolution or similar relief;
(d) have a proceeding filed against Tenant seeking any relief mentioned in (c) above which is
not discharged within sixty (60) days thereafter;
(e) have a trustee, receiver or liquidator appointed for Tenant or a substantial part of its
property;
(f) abandon the Premises for more than three (3) consecutive months;
(g) assign this Lease or Lease any portion of the Premises in violation of Article X; or
(h) fail to comply with any other provision of this Lease in the manner required hereunder
and such failure continues for thirty (30) days after written notice thereof to Tenant by Landlord
(or if the noncompliance cannot by its nature be cured within the thirty (30)-day period, if Tenant
fails to commence to cure such noncompliance within the thirty (30)-day period and thereafter
diligently prosecute such cure to completion).
16.2 Remedies on Default. Upon the occurrence of an Event of Default, Landlord shall have the right
to pursue anyone or more of the following remedies in addition to any other remedies now or later
available to Landlord at law or in equity. These remedies are not exclusive but instead are cumulative.
(a) Continue Lease. Landlord may continue this Lease in full force and effect. In such
case, so long as Landlord does not terminate Tenant's right to possession, the Lease will continue
in effect and Landlord shall have the right to collect Rent when due, and may undertake efforts to
relet the Premises, or any part of them, to third parties for Tenant's account. Tenant shall be liable
to Landlord for all reasonable costs Landlord incurs in re-letting the Premises including, without
limitation, broker's commissions, expenses of remodeling the Premises required by the re-letting,
and like costs. Re-letting can be for a period shorter or longer than the remaining term of this
Lease. Tenant shall pay to Landlord the Rent due under this Lease on the date the Rent is due, less
the Rent Landlord receives from any re-letting. No act by Landlord allowed by this section shall
terminate this Lease unless Landlord terminates Tenant's right to possession. After an Event of
Default and for as long as Landlord does not terminate Tenant's right to possession of the
Premises, if Tenant obtains Landlord's consent, Tenant shall have the right to assign or sublet its
interest in this Lease, but Tenant shall not be released from liability.
(b) Terminate Lease. Landlord may terminate the Lease and Tenant's right to
possession of the Premises at any time following an Event of Default. No act by Landlord other
than giving written notice to Tenant shall terminate this Lease. Acts of maintenance, efforts to
relet the Premises or the appointment of a receiver on Landlord's initiative to protect Landlord's
interest under this Lease shall not constitute a termination of Tenant's right to possession. On
termination, Landlord shall have the right to recover from Tenant all of the following:
(i) The worth, at the time of the award, of any unpaid Rent that had been earned at
the time of termination of this Lease;
(ii) 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 termination of this Lease until the time of the
award exceeds the amount of the unpaid Rent that Tenant proves could have been
reasonably avoided;
(iii) The worth, at the time of the award, of the amount by which the unpaid Rent for
the balance of the Term after the time of the award exceeds the amount of unpaid Rent
that Tenant proves could have been reasonably avoided;
(iv) Any other amount necessary to compensate Landlord for all detriment
proximately caused by Tenant's failure to perform obligations under this Lease, including,
without limitation, brokerage commissions, advertising expenses, expenses of remodeling
the Premises for a new tenant, and any special concessions made to obtain a new tenant;
and
(v) Any other amounts, in addition to or in lieu of those listed above that may be
permitted by law.
"The worth, at the time of the award" as used in clauses (i) and (ii) of this Paragraph (b) is
to be computed by allowing interest at the maximum rate allowed by law at that time, or if
there is no such maximum, at a rate of ten percent (10%) per annum. "The worth, at the
time of the award," as referred to in clause (iii) of this Paragraph (b) is to be computed by
discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco
at the time of the award plus one percent (I %).
(c) Receiver. Landlord shall have the right to have a receiver appointed to collect Rent.
Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall
constitute an election by Landlord to terminate this Lease.
16.3 Landlord's Default. Landlord's failure to perform any of its obligations under this Lease shall
constitute a Landlord Event of Default hereunder if the failure continues for thirty (30) days after written
notice of the failure from Tenant to Landlord. If the required performance cannot be completed within
thirty (30) days, Landlord's failure to perform shall not constitute a Landlord Event of Default if Landlord
undertakes to cure the failure within such thirty (30)-day period and diligently and continuously attempts
to complete the cure as soon as reasonably possible. Tenant waives any right to terminate this Lease and to
vacate the Premises upon Landlord's default under this Lease. Tenant's sole remedy on Landlord's default
is an action for damages or injunctive or declaratory relief.
ARTICLE XVII
PARKING
17.1 Parking. Landlord hereby grants to Tenant an nonexclusive license and right to use the retail
parking area, excluding reserved spaces, located on the Real Property for vehicular parking, such
exclusive license to be appurtenant to Tenant's leasehold estate created by this Lease. There shall be no
overnight parking of any vehicles, and vehicles which have been parked in violation of the terms hereof
may be towed away at the owner's expense. Tenant shall not permit or allow any vehicles that belong to or
are controlled by Tenant or Tenant's employees, suppliers, shippers, customers or invitees to be loaded,
unloaded, or parked in areas other than those designated by Landlord for such activities.
ARTICLE XVIII
MISCELLANEOUS
18.1 No Waiver. No receipt and retention by Landlord of any payment tendered by Tenant in
connection with this Lease shall constitute an accord and satisfaction, or a compromise or other
settlement, notwithstanding any accompanying statement, instruction or other assertion to the contrary
unless Landlord expressly agrees to an accord and satisfaction, or a compromise or other settlement, in a
separate writing duly executed by Landlord. Landlord will be entitled to treat any such payments as being
received on account of any item or items of Rent, interest, expense or damage due in connection herewith,
in such amounts and in such order as Landlord may determine at its sole option. Failure of any party to
exercise any right in one or more instance shall not be construed as a waive r of the right to strict
performance or as an amendment to or modification of this Lease. Any waiver of any condition or
provision set forth in this Lease shall not be deemed a waiver of any subsequent breach of such condition
or provision or of any other condition or provision, nor shall any such waiver be deemed a continuing
waiver.
18.2 Severability. The Parties intend this Lease to be legally valid and enforceable in accordance with
all of its terms to the fullest extent permitted by law. If an arbitrator or a court of competent jurisdiction
holds any provision hereof to be invalid or unenforceable in whole or in part for any rea son, the validity
and enforceability of the remaining clauses, or portions of them, shall not be affected unless an essential
purpose of this Lease would be defeated by loss of the invalid or unenforceable provision.
18.3 Governing Law; Construction. This Lease shall be construed according to the laws of the State
of California without regard to principles of conflict of laws. The parties acknowledge that this Lease is
the product of negotiation and compromise on the part of both parties, and agree that the provisions hereof
shall be construed in accordance with their fair meaning and not in accordance with any rule providing for
interpretation against the party who causes the uncertainty to exist or against the drafter. The captions used
for the Sections and Articles of this Lease have been inserted for convenience only and shall not be used
to alter or interpret the content of this Lease.
18.4 Binding Effect; Survival. The covenants, conditions, warranties and agreements contained in
this Lease shall be binding upon and inure to the benefit of the parties and their respective successors and
permitted assigns. The representations and warranties of Landlord and Tenant and the indemnification
obligations of Landlord and Tenant set forth herein shall survive the expiration or termination of this
Lease as shall all other provisions hereof which are intended to survive such expiration or termination.
18.5 Time. Time is of the essence of each provision of this Lease.
18.6 Entire Agreement; Amendments. This Lease and all exhibits attached hereto and incorporated
herein by this reference, constitutes the final, complete, and exclusive statement of the terms of the
agreement between Landlord and Tenant pertaining to the lease of space in the Building and supersedes
all prior and contemporaneous understandings or agreements of the parties. This Lease may not be
amended or modified except in a writing signed by both parties.
18.7 Notices. All notices delivered pursuant to this Lease shall be in writing and delivered to Landlord
or Tenant at the applicable address designated in Section 1.1 and Section 1.3, or to such other address as
may hereafter be designated by either party by written notice delivered to the other party in accordan ce
with this Section. Such notices shall be effective upon receipt or refusal of delivery. Such notices shall be
sent by (i) United States mail, certified mail with return receipt requested, or (ii) overnight delivery
service.
18.8 Force Majeure. Except as otherwise provided in this Lease, the time for performance of an
obligation other than the payment of money under this Lease shall be extended for the period during
which a party is prevented from performing due to Unavoidable Delay. "Unavoidable dela y" shall mean
any and all delay beyond the applicable party's reasonable control, including without limitation, delays
caused by the other party; governmental restrictions, regulations, controls, preemptions or delays; orders
of civil, military or naval authorities; strikes, labor disputes, lock-outs, shortages of labor or materials or
reasonable substitutes therefore; Acts of God; fire, earthquake, floods, explosions or other casualties;
extreme weather conditions or other actions of the elements; enemy action, civil commotion , riot or
insurrection.
18.9 Attorneys' Fees; Prejudgment Interest. If the services of an attorney are required by either
Party to secure the performance hereof or otherwise upon the breach or default of the other Party, or if any
judicial remedy is necessary to enforce or interpret any provision of this Lease, or if the services of an
attorney are required upon the bankruptcy of a party to this Lease to compel or object to assumption or
rejection of this Lease, seek relief from the automatic stay or object to an action to recover a preference or
fraudulent transfer, the prevailing party shall be entitled to reasonable attorneys' fees, costs, expert
witnesses fees, post judgment collection costs, and other expenses, in addition to any other relief to which
such party may be entitled. Any award of damages following judicial remedy as a result of the breach of
this Lease or any of its provisions shall include an award of prejudgment interest from the date of the
breach at the maximum amount of interest allowed by law.
18.10 Authority. Each Party warrants and represents that it has full authority to enter into this Lease,
that this Lease constitutes a binding obligation of such Party, and that the individual(s) signing on behalf
of such party are duly authorized to bind such Party hereto. In that regard, Landlord represents that title to
the Real Property was previously conveyed from the Redevelopment Agency of the City of South San
Francisco, a public body, corporate and politic, to the City of San Francisco, a municipal corporation,
prior to the dissolution of the Redevelopment Agency effective February 1, 2012. By operation of law,
real property held by the former Redevelopment Agency is or will be transferred to the Successor Agency
as successor in interest. The governing bodies of the Successor Agency and the City agree to take such
actions as may be necessary to approve, affirm or ratify this Lease.
18.11 Landlord Approvals. Whenever the consent or approval of Landlord is required hereunder, such
consent or approval may be granted or withheld by the Successor Agency Executive Director/City
Manager or his or her designee, unless the Successor Agency Executive Director/City Manager
determines in his or her discretion that such matter shall be referred to the Successor Agency/City
governing board(s) for consideration.
18.12 Counterparts. This Lease may be executed in counterparts, each of which shall constitute an
original, and all of which together shall constitute one and the same instrument. The signature page of any
counterpart may be detached therefrom without impairing the legal effect of the signature(s) thereon
provided such signature page is attached to any other counterpart identical thereto except having
additional signature pages executed by any other party. This Lease shall take effect when signed by all
parties hereto and all parties have written notice of the signature of all the remaining parties. The parties
agree that a signed copy of this Lease transmitted by one party to the other party(ies) by facsimile
transmission shall be binding upon the sending party to the same extent as if it had delivered a signed
original of the Lease.
.
18.13 Brokers. With the exception of SC Properties’ commission contemplated in Section 18.13.1
below, Tenant and Landlord each represent and warrant to the other that except as stated in this Section,
no broker or agent is entitled to a broker's commission or finder's fee in connection with the execution of
this Lease or the consummation of the transaction contemplated hereby, and each Party agrees to defend
and indemnify the other Party against any loss, expense or liability incurred by the other party as a result
of a breach of such representation and warranty. The provisions of this Section shall survive the expiration
or earlier termination of the Lease.
SC Properties. Landlord and SC Properties (“Contractor”) entered into that certain Professional Services
Agreement ("Agreement") dated December 2015, whereby Contractor agreed to perform professional
services related to the marketing of commercial leases for retail space at 636 El Ca mino Real, South San
Francisco. As compensation for services performed, Landlord will pay Contractor according to the
commission schedule for the full and satisfactory completion of the work in accordance with the terms and
conditions of the Agreement.
18.14 Submission of Lease. Submission of this document for examination or signature by the Parties
does not constitute an option or offer to lease the Premises on the terms in this document or a reservation
of the Premises in favor of Tenant. This document is not effective as a lease or otherwise until executed
and delivered by both Landlord and Tenant.
18.15 Non-Agency. It is not the intention of Landlord or Tenant to create hereby a relationship of
principal and agent, and under no circumstances shall Tenant be considered the agent of Landlord, it being
the sole purpose and intent of the Parties to create a relationship lf landlord and tenant.
18.16 No Merger. The voluntary or other surrender of this Lease by Tenant or a mutual cancellation
thereof, or a termination by Landlord, shall not work a merger, and shall at the option of Landlord
terminate all or any existing subtenancies or may at the option of Landlord, operate as an assignment to
Landlord of any or all such subtenancies.
SIGNATURES ONFOLLOWING PAGE
.
NOW, THEREFORE, Landlord and Tenant have executed this Lease as of the date first written above.
LANDLORD, THE PET CLUB STORES, A California corporation
CITY OF SOUTH SAN FRANCISCO,
A MUNICIPAL CORPORATION
By: City of South San Francisco, A Municipal
Corporation
By: RED CART MARKET INC. dba PET CLUB
STORES, A California corporation
Its: City Manager By: Tom Lee
Its: Secretary
Date: Date:
__________________________________________
City Attorney, Approved as to Form
__________________________________________
City Clerk, Attest
EXHIBIT A
DIAGRAM OF PREMISES