4907-2322-6235 v2
AMENDED AND RESTATED LEASE AGREEMENT
By and Between
CITY OF PACIFICA
a municipal corporation of the State of California
(“Lessor”)
and
ART GUILD OF PACIFICA
a California non-profit public benefit corporation
(“Lessee”)
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THIS AMENDED AND RESTATED LEASE AGREEMENT (“Agreement”), is entered into this XX day of November, 2025 (“Effective Date”), by and between the City of Pacifica, a California municipal corporation (“Lessor”), and the Art Guild of Pacifica, a California nonprofit public benefit corporation (“Lessee”). Lessor and Lessee shall be collectively referred to as the “Parties”.
Recitals
A. Lessor is the fee owner of that certain real property located at 1220 Linda Mar Boulevard, Pacifica, County of San Mateo, State of California, APN 023-281-130, as described on Exhibit A attached hereto and hereinafter incorporated by reference as Exhibit A; B. Lessor and Lessee first entered into that certain sublease agreement, dated as of October 3, 1996 (“Sublease Agreement”) wherein the Lessor subleased a portion of the Property to Lessee. At that time, the Lessor was not the fee owner of the Property. Lessor became the owner of the Property in 1998;
C. The Sublease Agreement was amended by that certain Amendment No. 1 to the Sublease Agreement, dated March 1, 2000, by and between Lessor and Lessee; and as amended by that certain Amendment No. 2 to Sublease Agreement, dated December 1, 2005, by and between Lessor and Lessee; and as amended by that certain Amendment No. 3 to Sublease Agreement, dated December 14, 2009, by and between Lessor and Lessee; and by that certain Amendment No. 4 to the Sublease Agreement dated March 7, 2023 (The Sublease Agreement and Amendment Nos. 1-4 are collectively referred to as the “Original Lease”).
D. The Parties desire to extend the term of the Original Lease for a five (5) year period, with an optional five (5) year extension and to otherwise amend and restate in their entirety the terms of the Original Lease between the parties, including but not limited to, removing reference to a “Sublease” and revising references of “Sub-Tenant” to “Lessee.” The Original Lease together with this Agreement are collectively referred to herein as the “Lease”.
NOW THEREFORE, in consideration of the mutual promises set forth in this Agreement and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby amend and restate the Original Lease, all upon and subject to the terms and conditions set forth in this Agreement.
Section 1. RECITALS
The recitals set forth above are true and correct, and incorporated herein by this reference.
Section 2. LEASED PREMISES
A. Lessor is the owner of the Property, which includes the West Wing Gallery (Identified as Area A in Exhibit B attached hereto), East Wing Gallery (Identified as Area B in Exhibit B attached hereto) and the former Kindergarten rooms (Identified as Area C in Exhibit B attached hereto (collectively “Buildings”) in which the Premises are located, the Common Area, and the asphalt parking area located on the Property adjacent to the Building (the “Parking Area”). Lessor agrees to lease to Lessee, and Lessee agrees to lease from Lessor, pursuant to the terms and conditions of this Agreement, approximately 22,283 contiguous square foot portion of that certain approximately 31,091 square foot Buildings located at 1220 Linda Mar Boulevard, Pacifica, California 94044 and the former credit union space, consisting of approximately 770 rentable square feet (the “Premises”). A drawing depicting the general location and layout of the Premises is attached hereto and incorporated by reference as Exhibit B. Neither the Common Area defined in this Section nor the Parking Area is part of the Premises. 4907-2322-6235 v2 Page 3 of 21
B. Common Area. Tenant may, subject to rules made by Lessor, and on a non-exclusive basis, use those areas on the Property exterior to the Buildings designated by Lessor from time to time for the common use of Lessor and all tenants of the Buildings, including but not limited to common corridors, hallways, restrooms, lobbies, telephone areas, utility or telephone rooms, parking, sidewalks and other public areas (the “Common Area”). Lessor has sole discretion to determine the design and location of the Common Area and to determine the manner in which the Common Area is maintained and operated. The Common Area does not include space within the Premises.
Section 3. TERM OF LEASE
A. Initial Term. The initial term of this Agreement shall be five years, commencing on January 1, 2026 (the “Initial Term”) and unless sooner terminated in accordance with the terms of the Lease, shall expire at 5 o’clock p.m. on December 31, 2030 (“Initial Term”).
B. Option to Extend. Provided (i) Lessee is not in default under the terms of this Current Lease at the time the renewal option is exercised or at the commencement of the Extension Term (as hereinafter defined), and (ii) Lessee has not been in default more than twice in any twelve (12) month period, Lessee shall have one (1) option to renew this Current Lease for an additional five (5) year period (“Extension Term”). The Extension Term shall be on all the terms and conditions of this Current Lease, except that Lessor shall have no additional obligation for improvements or any other tenant inducements. Lessee must exercise its option to extend this Current Lease by giving Lessor six (6) months written notice of Lessee’s election to exercise its extension option prior to the end of the Initial Term.
(1) Any notice relating to the Extension Term not given in a timely manner shall be void at Landlord’s election, and Lessee shall be deemed to have waived its extension rights.
The option to extend set forth herein is personal to Lessee and shall not be included in any assignment or other transfer of this Current Lease.
(2) Base Rent Adjustment during Extension Term. Base Rent during the Extension Term shall be adjusted as follows: commencing on the commencement of the Extension Term and each subsequent annual anniversary of the commencement of the Extension Term (“Adjustment Dates”) the Base Rent shall be multiplied by two and one-half percent (2.5%).
Section 4. RENT; UTILITIES
A. Base Rent; Rent. All Rent under this Lease shall commence as of January 1, 2026 (“Commencement Date”). Rent shall be paid as set forth in this Section and as set forth in Exhibit C, attached hereto and incorporated herein by this reference. Lessee shall pay to Lessor, at Lessor's Address designated in Section 21, or at such other address as Lessor may from time to time designate in writing to Lessee for the payment of Rent, the Base Rent of Two Thousand Three Hundred Fifty-Three and 00/100 Dollars ($2,353.00), without notice, demand, offset or deduction, in advance, on the first day of each calendar month. The Base Rent amount includes the costs of the following utilities consumed on the Premises: water, gas, sewer, electricity, refuse, sewage, garbage, and pest control services for the Premises (collectively, "Services"). Upon execution of this Lease, Lessee shall pay to Lessor the total sum of (a) the first month's Base Rent due, and (b) any prorated rent for a partial month if the Commencement Date falls on a date other than the first calendar day of a month. All sums other than Base Rent which Lessee is obligated to 4907-2322-6235 v2 Page 4 of 21
pay under this Lease shall be deemed to be Additional Rent due on the same date as Base Rent unless otherwise specified hereunder or otherwise requested by Lessor whether or not such sums are designated as Additional Rent. Notwithstanding the foregoing, late charges, as specified in this Section, shall be due and payable immediately upon incurrence. The term "Rent" means the Base Rent and all Additional Rent payable hereunder. If Rent is due for a period of less than a full month, it shall be prorated for such partial month on the basis of a thirty (30) day month. Base Rent shall be adjusted as set forth in subsection (4) below upon each anniversary of the Commencement Date. (1) Application of Payments. All payments received by Lessor from Lessee shall be applied to the oldest obligation owed by Lessee to Lessor. No designation by Lessee, either in a separate writing, on a check or money order, or otherwise shall modify this clause or have any force or effect.
(2) Late Charge and Interest. The late payment of any Rent will cause Lessor to incur additional costs, including administration and collection costs and processing and accounting expenses and increased debt service ("Delinquency Costs"). If Lessor has not received any installment of Rent within five (5) days after such amount is due, Lessee shall pay a late charge of ten percent (10%) of the delinquent amount immediately. The ten percent (10%) late charge represents a reasonable estimate of the Delinquency Costs incurred by Lessor. In addition, all such delinquent amounts shall bear interest from the date such amount was due until paid in full at a rate per annum ("Applicable Interest Rate") equal to the lesser of (a) the maximum interest rate permitted by Law or (b) five percent (5%) above the rate publicly announced by Bank of America, N.A. (or if Bank of America, N.A. ceases to exist, the largest bank then headquartered in the State of California) ("Bank") at its "Reference Rate." If the use of the announced Reference Rate is discontinued by the Bank, then the term Reference Rate shall mean the announced rate charged by the Bank which is, from time to time, substituted for the Reference Rate. Lessor and Lessee recognize that the damage which Lessor shall suffer as a result of Lessee's failure to pay such amounts is difficult to ascertain and said late charge and interest are the best estimate of the damage which Lessor shall suffer in the event of late payment. Lessor's acceptance of late Rent, partial Rent and late charges does not equate with a waiver of Lessee's default with respect to the overdue amount, or prevent Lessor from exercising any rights and remedies available under this Lease and/or by operation of Law.
(3) Additional Rent. In addition to paying the Base Rent specified in this Section, and pursuant to any Addendum or Amendment to this Lease that Lessor and Lessee may execute, Lessee shall pay as Additional Rent the cost of Improvements and any other amounts of any kind that become due or payable by Lessee to Lessor under the terms of this Lease. Unless Lessor elects otherwise pursuant to this Lease, all amounts due under this Lease as Additional Rent are payable for the same periods and in the same manner, time and place, as the Base Rent. Lessee's obligation to pay Rent under this Lease survives the Term to the extent such obligation has not been fulfilled during the Term.
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(4) Base Rent Adjustments. Commencing on the first annual anniversary of the Commencement Date and on each subsequent annual anniversary thereafter (“Adjustment Dates"), other extensions or renewals, the Base Rent for the ensuing twelve (12) month period ("Adjustment Period") shall be an amount equal to the Base Rent including any prior Base Rent Adjustments in effect immediately prior to the commencement of the applicable Adjustment Period and without regard to any temporary rent credit then or previously in effect pursuant to the provisions of this Lease ("Current Rent") multiplied by One Hundred and Two and One-Half Percent (102.5%) (“Base Rent Adjustment”).
B. Lessee shall be solely responsible for contracting for, and shall promptly pay all charges for telephone, computers and cable lines, wiring, materials, security.
C. Lessee shall not waste Services and shall cooperate fully with Lessor to ensure the most effective operation of the Buildings heating and air conditioning system, if any. Lessee shall not adjust any controls of that heating and air conditioning system.
Lessor shall have the right to control and operate the Common Area and the heating and air-conditioning system in such manner as it deems appropriate for the general benefit of the Buildings Lessees. Lessee shall not use any method of heating or air-conditioning, other than that supplied by Lessor, without Lessor's prior written consent. In no event shall Lessor be liable for any interruption or failure in the supply of any such Services to Lessee. Lessor in no way warrants the adequacy of any existing utility systems serving the Premises.
D. Exculpation of Liability. Lessor shall not be liable for any loss or damage suffered by Lessee or others, by reason of Lessor's failure to furnish any of the Services, or furnishing reduced Service, no such failure or reduction shall constitute or be construed as a constructive or other eviction of Lessee, nor shall Lessor be liable for loss of business or injury to property however occurring, through or in connection with or incidental to such failure to furnish or reduction of any of the Services. Should Lessor elect to provide a security patrol or system, Lessor shall not be responsible for any damage or injury to Lessee, Lessee's officers, agents, employees, independent contractors, invitees, customers, visitors, licensees, assignees or sublessees (individually and collectively, "Lessee's Parties"), or the Premises or property due to failure, action or inaction of such patrol or system. Lessor reserves the right to stop Services when necessary, by reason of accident or emergency or for inspection, repairs, alterations, decorations, additions or improvements which, in the judgment of Lessor, are desirable or necessary to be made, until same shall have been completed, and shall further have no responsibility or liability for failure to supply any Services in such instance. Lessor shall use reasonable efforts to minimize the inconvenience to Lessee from such disruptions or interruptions of Services and shall provide Lessee with reasonable notice of such disruptions or interruptions to the extent that Lessor is aware of or has been provided with advance notice of the disruptions or interruptions. The exculpation of liability under this Section shall not apply to the extent claims are caused by Lessor's sole or active negligence or willful misconduct. 4907-2322-6235 v2 Page 6 of 21
E. No Representation. Lessor makes no representation with respect to the adequacy or fitness of the heating, air conditioning or ventilation equipment in the Buildings to maintain temperatures which may be required for, or because of, any equipment of Lessee other than normal fractional horsepower office equipment, and Lessor shall have no liability for loss or damage suffered by Lessee or others in connection therewith.
F. Conservation and Use Policies. In the event of imposition of federal, state, or local governmental controls, rules, regulations, or restrictions on the use or consumption of energy or other utilities during the Term, both Lessor and Lessee shall be bound thereby. In the event of a difference in interpretation by Lessor and Lessee of any such controls, the interpretation of Lessor shall prevail, and Lessor shall have the right to enforce compliance therewith, including the right of entry into the Premises to effect compliance.
Section 5. USE OF PREMISES
A. The Premises shall be used for public art exhibitions, community events and meetings, art studios, education programs, community meeting space, and small workshops, subject to any applicable or required approvals from the City of Pacifica.. The Premises shall be used for no other purposes, except as may be provided herein. Provided, however, that no use shall be made or permitted to be made of said Premises, nor acts performed, which will increase the existing rate of insurance upon the Buildings in which said Premises are located or cause a cancellation of any insurance policies covering said Buildings or any part thereof. Nor shall Lessee allow to be sold or permit to be kept, used on, sold in or about the leased Premises any articles which may be prohibited by insurance carriers for Lessor and Lessee, the policies issued to insure the said Premises and State, Federal and Municipal law.
B. Unusual use of the Property such as for fairs, carnivals, art festivals, et cetera, shall be with the approval of Lessor. Said unusual use of the Premises shall be in compliance with State law and City and Fire District ordinances. Lessor will require evidence of sufficient insurance coverage from Lessee to indemnify Lessor in the event a claim arises from or during an “unusual use”. Request for such approval shall be submitted in writing thirty (30) days prior to the event’s occurrence. For purposes of this section “unusual use” of the Premises means any events not consistent with the Lessee’s normal operations.
C. No goods, wares, merchandise, art objects, or photographs may be offered for sale in the individual studios except those items which are made, manufactured and/or created by the tenant artist. This provision does not apply to the gallery.
6. CONDITION OF PREMISES
A. Lessee accepts the condition of Premises at the time of occupancy as satisfactorily meeting its occupancy requirements. By entry hereunder, Lessee accepts the leased Premises AS IS. Lessee is fully acquainted with the nature and condition of the Premises and the condition of existing improvements.
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B. Lessor makes no representations or warranties as to the repair or condition of the Premises. Lessee accepts the leased Premises in its existing condition AS IS. Lessee is aware of the existence of asbestos on the Premises and accepts this condition AS IS.
C. It shall be Lessee's responsibility to assure that property is in proper and safe condition for the proposed use.
7. DESTRUCTION OF PREMISES
A. In the event of partial destruction of said Premises during said term, Lessee shall forthwith repair the same, provided such repairs can be made within forty-five (45) days under the laws of the State, Federal or Municipal authorities, but such partial destruction shall in no way annul or void this Lease, except that Lessee shall be entitled to a proportionate reduction of rent while such repairs are being made, such proportionate reduction to be based upon the extent to which the making of such repair shall interfere with the business carried on by Lessee in said Premises.
B. If such repairs cannot be made in forty-five (45) days, Lessor may, at its option, make the same within a reasonable time, this Lease continuing in full force and effect and the rent to be proportionately reduced-as provided for in this paragraph. In the event that Lessor does not so elect to make such repairs which cannot be made in forty-five (45) days or such repairs cannot be made under such laws or regulations, this Lease may be terminated at the option of either party.
C. In the event that the Buildings in which the demised Premises may be situated is destroyed to an extent of not less than one-third of the replacement costs thereof, Lessor may elect to terminate this Lease whether the demised Premises be injured or not. A total destruction of the Buildings in which the Premises may be situated shall terminate this Lease.
8. ALTERATIONS AND IMPROVEMENTS
A. Lessee shall not make or suffer to be made any alterations, additions or improvements to or of the Premises or any part thereof without the written consent of Lessor being first obtained, and any alterations, additions or improvements to or of the Premises, including, but not limited to, wall covering, paneling and built-in cabinet work, but excepting moveable furniture and trade fixtures, shall on the expiration or termination of this Lease become a part of the Premises and belong to Lessor, and shall be surrendered with the Premises.
B. In the event Lessor consents to the making of any alterations, additions or improvements to the Premises by Lessee, the same shall be made by Lessee at Lessee’s sole expense, and any contractor or person selected by Lessee to make the same must first be approved by Lessor, and will be under the supervision of Lessor maintenance staff.
C. Upon the expiration or termination of this Lease, Lessee shall, upon demand by Lessor be given at least ten (10) days prior to the expiration or termination of this Lease, remove within ten (10) days, at Lessee’s sole expense, any alterations, additions, or improvements made by Lessee, designated by Lessor to be removed, and Lessee shall, forthwith and will all due diligence, at its sole expense, repair any damage to the Premises caused by such removal.
D. Any alterations, and or improvements, must comply with all State, Federal, and Municipal codes that are in force.
9. WASTE; INSTALLATION AND REMOVAL OF FIXTURES
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A. Lessee shall commit no act of waste and shall take good care of the Premises and the fixtures and appurtenances therein, and shall in the use and occupancy of the Premises, conform to all laws, orders and regulations of the Federal, State, and Municipal governments or any of their departments. .All improvements made by Lessee to the Premises which are so attached to the Premises that they cannot be removed without material injury to the Premises shall become the property of Lessor upon installation.
B. Not later than the last day of the term, Lessee shall, at Lessee’s sole expense, remove all of Lessee’s personal property and those improvements made by Lessee which have not become the property of Lessor, include trade fixtures, cabinetwork, moveable paneling, partitions and the like; repair all injury done by or in connection with the installation or removal of such property and improvements; and surrender the Premises in as good condition as it was at the beginning of the term, reasonable wear and damage by fire, the elements, casualty, or other cause not due to the misuse or neglect by Lessee or Lessee’s agents, employees, visitors or licensees, excepted.
All property of Lessee remaining on the Premises after the last day of the term of this Lease shall be conclusively deemed abandoned and may be removed by Lessor and Lessee shall reimburse Lessor for the cost of such removal.
10. FIRE SAFETY
Lessee shall supply and maintain all fire safety equipment required by Federal, State, or Municipal law on the Premises including, but not limited to, fire extinguishers, and smoke detector systems.
11. BUSINESS LICENSE
All of the tenants of Lessee shall obtain and post a current business license. Failure of any tenant to obtains said license shall be basis for termination of this Lease by Lessor.
12. HOLD HARMLESS AND INDEMNIFICATION
A. Indemnity. Except with respect to claims solely caused by Lessor’s active negligence or willful misconduct, Lessee shall indemnify, protect, defend, and hold harmless Lessor and its elected and appointed officers, officials, employees, volunteers, lenders, agents, and contractors and each of their successors and assigns from and against any and all claims, judgments, causes of action, damages, penalties, costs, liabilities, and expenses, including all costs, attorneys’ fees, expenses and liabilities incurred in the defense of any such claim or any action or proceeding brought thereon, arising at any time during or after the Term directly or indirectly as a result of or in connection with (i) any default in the performance or the performance of any obligation on Lessee’s part to be performed under the terms of this Lease; (ii) Lessee’s use of the Premises or the Property, including the conduct of Lessee’s business or any activity, work or things done, permitted or suffered by Lessee in or about the Buildings, the Premises, the Common Area, or other portions of the Property; (iii) any act, error or omission of Lessee or of any invitee, licensee or guest of Lessee, in or about the Buildings, the Premises, the Common Area, or other portions of the Property; (iv) loss of, injury, or damage to or destruction of property (including loss of use resulting from that loss, injury, damage or destruction); (v) all resulting economic losses, consequential and/or exemplary damages; and (vi) any subleases, assignments and related activities, (all of the foregoing, collectively, the “Indemnification”). Lessee shall provide such Indemnification by and through counsel reasonably acceptable to Lessor.
The obligations of Lessee under this Section shall survive the expiration or sooner termination of this Lease.
B. Exemption of Lessor from Liability. Lessee, as a material part of the consideration to Lessor, hereby assumes all risk of damage to property including, but not limited to, 4907-2322-6235 v2 Page 9 of 21
Lessee’s fixtures, equipment, furniture and alterations or injury to persons in, upon or about the Buildings, the Premises, the Common Area, or other portions of the Property arising from any cause, and Lessee hereby waives all claims in respect thereof against Lessor, except to the extent such claims are caused by Lessor’s sole or active negligence or willful misconduct. Lessee hereby agrees that Lessor shall not be liable for injury to Lessee’s business or any loss of income therefrom or for damage to the property of Lessee, or injury to or death of Lessee, Lessee’s Parties or any other person in or about the Buildings, the Premises, the Common Area, or the Property, whether such damage or injury is caused by fire, steam, electricity, gas, water or rain, or from the breakage, leakage or other defects of sprinklers, wires, appliances, plumbing, air conditioning or lighting fixtures, or from any other cause, whether said damage or injury results from conditions arising upon the Buildings, the Premises, the Common Area, or other portions of the Property or from other sources or places, and regardless of whether the cause of such damage or injury or the means of repairing the same is inaccessible to Lessee, except damage or injury caused solely by Lessor’s sole or active negligence or willful misconduct. Lessor shall not be liable for any damages arising from any act or neglect of any other tenant, if any, of the Buildings, the Premises, the Common Area or other portions of the Property or Lessor’s failure to enforce the terms of any agreements with parties other than Lessee.
13. INSURANCE
A. Lessor’s Insurance. Lessor may elect to maintain insurance or an insurance equivalent (including but not limited to, e.g., that offered to a municipality through and by a joint powers authority, a self-insurance pool of liability coverage authorized pursuant to California Government Code Section 6500, or similar collective) insuring the Buildings on an occurrence basis against fire and extended coverage (including, if Lessor elects, “all risk” coverage, earthquake/volcanic action, flood and/or surface water insurance) similar in type and coverage limits to that carried by Lessor on its other properties. Lessor may also carry such other insurance as Lessor may deem prudent or advisable, in such amounts and on such terms as Lessor shall determine.
B. Lessee’s Insurance. Lessee, shall, at Lessee’s expense, obtain and keep in force at all times the following insurance, and shall be liable for all premiums, deductibles, and self-insured amounts, if any, in connection therewith:
(1) Commercial General Liability Insurance (Occurrence Form). Lessee shall maintain commercial general liability insurance with coverage at least as broad as Insurance Services Office form CG 00 01, in an amount not less than two million dollars ($2,000,000) per occurrence for bodily injury, personal injury, and property damage, including without limitation, blanket contractual liability. If a general aggregate limit applies, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit. Lessee’s general liability policies shall be primary and shall not seek contribution from the City’s coverage, and be endorsed using Insurance Services Office form CG 20 10 (or equivalent) to provide that City and its officers, officials, employees, and agents shall be additional insureds under such policies.
(2) Workers’ Compensation and Employer’s Liability Insurance. Lessee shall maintain Workers’ Compensation Insurance and Employer’s Liability Insurance with limits of at least one million dollars ($1,000,000). Lessee shall submit to City, along with the 4907-2322-6235 v2 Page 10 of 21
certificate of insurance, a waiver of subrogation endorsement in favor of City, its officers, agents, employees, and volunteers
(3) Property Insurance. “All risk” property insurance including boiler and machinery comprehensive form, if applicable, covering damage to or loss of any improvements, personal property, fixtures and equipment, including use and disposal of photograph developing chemicals and other hazardous materials, of Lessee (collectively “Lessee’s Property”) (and coverage for the full replacement cost thereof including business interruption of Lessee), together with, if the property of Lessee’s invitees is to be kept in the Premises, warehouser’s legal liability or bailee customers insurance for the full replacement cost of the property belonging to invitees and located in the Premises. (4) General.
(a) Insurance Companies. Insurance required to be maintained by Lessee shall be written by companies licensed to do business in California and having a “General Policyholders Rating” of at least A:VIII (or such higher rating as may be required by a lender having a lien on the Premises) as set forth in the most current issue of “Best’s Insurance Guide.”
(b) Certificates of Insurance. Lessee shall deliver to Lessor certificates of insurance for all insurance required to be maintained by Lessee pursuant to this Lease, in the form of the ACORD standard certificate of insurance, prior to the Commencement Date. Lessee shall, at least ten (10) days prior to expiration of the policy, furnish Lessor with certificates of renewal or “binders” thereof. Each certificate shall expressly provide that such policies shall not be cancelable or otherwise subject to modification except after sixty (60) days’ prior written notice to the parties named as additional insureds as required in this Lease (except in the case of cancellation for nonpayment of premium in which case cancellation shall not take effect until at least ten (10) days’ notice has been given to the parties named as additional insureds). If Lessee fails to maintain any insurance required in this Lease, Lessee shall be liable for all losses and cost resulting from said failure.
(c) Umbrella/Excess Insurance. Any umbrella liability policy or excess liability policy (which shall be in “following form”) shall provide that if the underlying aggregate is exhausted, the excess coverage will drop down as primary insurance.
The limits of insurance maintained by Lessee shall not limit Lessee’s liability under this Lease.
(d) Notification of Incidents. Lessee shall notify Lessor within twenty four (24) hours after the occurrence of any accident or incident in/at Property or any portion thereof which could give rise to a claim against Lessor, its coverage, Lessee or Lessee’s insurance. Lessee’s notice shall be accompanied by a copy of any accident/incident form prepared by Lessee, reporting and/or relating to the accident/incident.
14. ENTRY AND INSPECTION
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Lessee shall permit Lessor or Lessor’s agents to enter upon the Premises upon reasonable notice, for the purpose of inspecting the same, and will permit Lessor at any time within sixty (60) days prior to the expiration of this Lease to place upon the Premises any usual "To Let" or "For Lease" signs, and permit persons desiring to lease the same to inspect the Premises thereafter.
15. TAXES
Lessee shall pay or cause to be paid, before delinquency, any and all taxes and assessments, or other charges of any description levied or assessed on or against the Premises leased by Lessee and which become payable during the term of this Lease. Lessee acknowledges and agrees that this Lease may create a possessory interest; such possessory interest may be subject to property taxation if created, and that Lessee may be subject to the payment of property taxation if created and that Lessee may be subject to the payment of property taxes levied on such interest. In the event property leased by Lessee is taxed, Lessee agrees to pay such tax.
16. ASSIGNMENT AND SUBLETTING
Lessee shall not assign or transfer this Lease or any interest herein nor sublet the whole or any part of the Premises without first having obtained the written consent of Lessor. Lessee agrees that it will not allow any use or occupancy of the Premises without first obtaining a written and signed sublease from any prospective subtenant. Lessee further covenants and agrees that neither this Lease nor any interest herein shall be assignable or transferable in any proceeding in bankruptcy, or insolvency taken by or against Lessee or by process of any law applying to such proceedings without the consent of Lessor; and that upon any assignment, sale or written consent of Lessor; and that upon any assignment, sale or transfer of this or any interest therein, by judgment, execution, bankruptcy or insolvency proceedings, this Lease shall immediately terminate at the option of Lessor.
17. EVENTS OF DEFAULT
A. Events of Default: A breach of this Lease shall exist if any of the following events shall occur:
(1) Any failure of Lessee to pay the Rent or any other monetary sums required to be paid hereunder, where such failure continues for ten days after written notice by Lessor to Lessee.
(2) The abandonment or vacation of the Premises by the Lessee. (3) A failure by Lessee to observe and perform any other provision of the Lease to be observed or performed by Lessee, if such failure continues for thirty (30) days after written notice thereof by Lessor to Lessee; provided, however, that if the nature of the default is such that the same cannot reasonably be cured within thirty (30) days. Lessee shall not be deemed to be in default if Lessee shall within such period commence such cure and, thereafter, diligently prosecute the same to completion. A time extension beyond thirty (30) days shall be at the option of Lessor.
18. REMEDIES
A. Upon any event of material default, Lessor shall have the following remedies, in addition to all other rights and remedies provided by law to which Lessor may resort cumulatively, or in the alternative:
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(1) Lessor shall be entitled to keep this Lease in full force and effect (whether or not Lessee shall have abandoned the Premises) and to enforce all of its rights and remedies under this Lease, including the right to recover rent and other sums as they become due, plus interest at the rate of twelve (12%) percent per annum plus appropriate penalties from the due date of each installment or rent or other sum until paid. (2) Lessor shall be entitled to the right of re-entry and may remove all persons and property from the Premises. Such property may be removed and stored in a public warehouse or elsewhere at the cost of, and for the account of, the Lessee. Lessor can elect to dispose of personal property in the manner prescribed by law. Should Lessor elect to re-enter or should Lessor take possession pursuant to legal proceeding or any notice provided by law, Lessor may terminate this Lease, re-let said Premises, or any part thereof, for such term or terms (which may be for a term extending beyond this Lease) and at such rental or rentals and upon such other terms and conditions as Lessor, in its sole discretion, may deem, advisable with the right to alter or repair the Premises upon such re-letting. (3) In such event, Lessee shall be immediately liable to pay to Lessor, in addition to any other amounts due hereunder:
(a) The cost and expense of such re-letting and such alterations and repairs, and any amount by which the rent reserved herein for the period of such re-letting but not beyond the term hereof, exceeds the amount agreed to be paid as rent for such period.
(b) At the option of Lessor, rents received by Lessor from such re-letting shall be applied first to the repayment of indebtedness other than rent due hereunder, second to costs and expenses of re-letting and alterations or repairs, and third to the payment of rent due and unpaid hereunder, and applied in payment of future rent as the same may become due and payable. Lessee shall be credited only with rent actually received by Lessor. Lessee shall, in such event, pay any deficiency between the amount due from Lessee to Lessor and the amount credited. (c) Lessor may terminate this Lease on account of a breach by giving Lessee written notice of termination. Lessor’s re-entry or taking possession shall not be construed as an election to terminate this Lease unless termination be decreed by a court of competent jurisdiction.
(d) Should Lessor at any time terminate this Lease for any breach, in addition to any other remedy Lessor may have, Lessor may recover from Lessee all damages Lessor may incur by reason of such breach, including the cost of recovering the Premises, and including the worth at the time of such termination, or at the time of an award if suit be instituted to enforce this provision, or any amount by which the unpaid rent for the balance of the term exceeds the amount of rental loss for the balance of the term which the Lessee proves could be reasonably avoided.
19. WAIVER
A waiver by Lessor or Lessee of any breach of any covenant or condition contained herein shall not be deemed to be a waiver of such covenant or condition of any subsequent acceptance or 4907-2322-6235 v2 Page 13 of 21
payment of rent hereunder by either party shall not be deemed to be a waiver of any preceding breach by either party of any covenant or condition of this Lease.
20. BROKERS
Lessee warrants that it has had no contact, dealings or communications with any real estate brokerage firm or agent or other person who can claim a right to a commission or finder's fee in connection with the negotiation of this Amendment and that no real estate commissions or finder's fees are payable in connection herewith. Lessee shall indemnify, defend and hold Lessor harmless from all expenses, claims, damages (including a reasonable attorney's fee and costs) incurred by Lessor as a result of a breach of this warranty.
21. NOTICES
All notices to the Parties shall, unless otherwise requested in writing, be sent to Lessor addressed as follows:
Lessor of Pacifica
Attention: Director, Parks, Beaches & Recreation Department 540 Crespi Drive
Pacifica, CA 94044
And to Lessee addressed as follows:
Lessee’s Notice Address:
Art Guild of Pacifica
Attention: President
1220-B Linda Mar Boulevard
Pacifica, CA 94044
Notices may be served upon Lessee or Lessor in person or by first class mail or by certified mail whether or not said mailing is accepted. These addresses shall be used for service of process.
22. AUTHORIZATION
The person or persons signing on behalf of Lessee warrant and represent that he, she or they are authorized to sign the Lease on behalf of the Lessee and to bind the Lessee to the terms of this Lease.
23. MECHANIC’S LIENS
Lessee shall not suffer or permit to be enforced against the Premises, or any part thereof, any mechanic’s material-people’s contractor’s or subcontractor’s liens arising from or any claim for damage growing out of work of any construction, repair, restoration, replacement or improvement, or any other claim or demand howsoever the same may arise, but Lessee shall pay or cause to be paid all such liens, claims or demands before any action is brought to enforce the same against the Premises. Lessee agrees to indemnify, defend and hold the Lessor and Premises harmless from any and all such liens, claims and demands together with reasonable attorney’s fees and all costs and expenses in connection therewith. Lessor shall have the right to post and keep posted on the Premises such notices of non-responsibility as Lessor may deem necessary for the protection on Lessor.
24. HEIRS, ASSIGNS, SUCCESSORS
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This Lease Agreement is binding upon and inures to the benefit of the heirs, assigns and successors in interest to the parties.
25. USE OF COMMON AREAS
A. If there are multiple lessees of the Property, use of the Common Area, will be adjusted by Lessor insofar as possible, to meet the needs of all parties. Lessee shall be obliged to share these areas as requested by Lessor, and comply with any rules or restrictions established by Lessor pertaining to those common areas.
B. Lessee will share responsibility for keeping Common Areas clean, orderly, and in sanitary condition. Common Areas include restrooms, hallways, and any other area that is shared by multiple lessees.
C. Lessee may from time to time use the Common Areas as part of a public art exhibition or community event being held within the Premises. If Lessee uses the Common Areas in such a manner, the Lessee will ensure that the Common Areas are clean and orderly after such use.
D. No use shall be made or permitted of the Premises, the common and parking areas, or any part thereof, nor any acts done, which will violate, make imperative, or increase the existing rate of any insurance policy at any time held by or in any way for the benefit of Lessor pursuant to any provision of this Lease agreement.
E. Lessee will share common parking areas with other lessees and Lessor. No specific amount of space is guaranteed to Lessee.
F. Lessee agrees that its use of the restrooms is not exclusive and Lessee acknowledges that other Lessees or their patrons may have access to said facilities.
26. PROPERTY MANAGER
Lessee shall operate and manage all operations taking place on the Premises, including, but not limited to, the subleases with Lessee and shall not hire a third party to act as property manager, except that Lessee may enter into a written operating/property management agreement with Sanchez Art Center, a 501(C)(3) nonprofit corporation, in a form approved by the Pacifica City Attorney. Lessee shall provide City with a signed copy of any property management agreement.
The property management agreement shall not constitute an assignment of the Lease and Lessee remains ultimately responsible for the rights and obligations set forth in the Lease, including any amendments.
27. RELOCATION WAIVER
A. Lessee fully releases and discharges the City of Pacifica (in its capacity as Lessor and otherwise as a municipal corporation) from all and any manner of rights, demands, liabilities, obligations, claims, or cause of actions, in Law or equity, of whatever kind or nature, whether known or unknown, whether now existing or hereinafter arising, which arise from or relate in any manner to the sale of the Property, the Buildings, or the Premises; the full or partial termination or expiration of Lessee's leasehold interest as permitted under this Lease; or the relocation of Lessee's business operations or the relocation of any person or persons, business or businesses, or other occupant or occupants located on the Premises including, without limitation, the specific waiver and release of any right to any relocation benefits, assistance and/or payments under Government Code sections 7260 et seq. ("Relocation Assistance Law"), notwithstanding that such relocation assistance, benefits and/or payments may be otherwise required under the Relocation Assistance Law or other state or federal law. Lessee acknowledges and agrees that the release and 4907-2322-6235 v2 Page 15 of 21
waiver set forth in this Section is material consideration for Lessor's lease of the Premises to Lessee on the terms set forth herein and that, but for this release and waiver, Lessor would not have leased the Premises to Lessee.
B. It is hereby intended that the above release relates to both known and unknown claims that the Lessee may have, or claim to have, against the Lessor with respect to the subject matter contained herein or the events relating thereto. By releasing and forever discharging claims both known and unknown which are related to or which arise under or in connection with the items set out above, the Lessee expressly waives any rights under California Civil Code section 1542, which provides:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR
RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR
AT THE TIME OF EXECUTING THE RELEASE, AND THAT, IF KNOWN BY HIM OR
HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY."
C. Each sublease or rental agreement shall contain a relocation waiver in substantially the following form: “Relocation Waiver. Sublessee fully releases and discharges the Lessor of Pacifica (in its capacity as Lessor and otherwise as a municipal corporation) from all and any manner of rights, demands, liabilities, obligations, claims, or cause of actions, in Law or equity, of whatever kind or nature, whether known or unknown, whether now existing or hereinafter arising, which arise from or relate in any manner to the sale of all or any portion of the Project, Buildings, Premises, or the Subleased Premises, the full or partial termination of Sublessee's leasehold interest as permitted under this Sublease, or the relocation of Sublessee's business operations or the relocation of any person or persons, business or businesses, or other occupant or occupants located on the Subleased Premises, including, without limitation, the specific waiver and release of any right to any relocation benefits, assistance and/or payments under Government Code sections 7260 et seq. ("Relocation Assistance Law"), notwithstanding that such relocation assistance, benefits and/or payments may be otherwise required under the Relocation Assistance Law or other state or federal law. Sublessee acknowledges and agrees that the release and waiver set forth in this section is material consideration for Lessor's consent to the sublease by Sublessor of the Subleased Premises to Sublessee on the tetras set forth herein and that, but for this release and waiver, Lessor would not have consented to the sublease of the Subleased Premises by Sublessor to Sublessee. It is hereby intended that the above release relates to both known and unknown claims that the Sublessee may have, or claim to have, against the Lessor or the Lessor of Pacifica with respect to the subject matter contained herein or the events relating thereto. By releasing and forever discharging claims both known and unknown which are related to or which arise under or in connection with the items set out above, the Sublessee expressly waives any rights under California Civil Code section 1542, which provides:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR
RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR
AT THE TIME OF EXECUTING THE RELEASE, AND THAT, IF KNOWN BY HIM OR
HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY."”
28. NAYLOR ACT
The Property is subject to provisions of the Naylor Act, California Education Code sections 17485-17500 et. seq. Lessor has acquired the Property from the school district, and is required to maintain those portions of the Property which were used for school playground, playing field, or other outdoor recreational purposes and open-space land particularly suited for recreational purposes accordingly. If the Lessor does not do so, the school district may reacquire the site. In 4907-2322-6235 v2 Page 16 of 21
such event, Lessor shall have the right to terminate the proposed lease upon sixty (60) days' prior written notice, but in no event later than the reacquisition occurs.
29. CERTIFIED ACCESS SPECIALIST
For purposes of Section 1938(a) of the California Civil Code, Lessor hereby discloses to Lessee, and Lessee hereby acknowledges, that neither the Buildings nor any portion of the Premises has undergone inspection by a Certified Access Specialist (CASp) (defined by California Civil Code Section 55.52). Pursuant to California Civil Code Section 1938, Lessee is hereby notified as follows: “A Certified Access Specialist (CASp) can inspect the subject premises and determine whether the subject premises comply with all of the applicable construction-related accessibility standards under state law. Although state law does not require a CASp inspection of the subject premises, the commercial property owner or lessor may not prohibit the Lessee from obtaining a CASp inspection of the subject premises for the occupancy of the Lessee, if requested by Lessee.
The parties shall mutually agree on the arrangements for the time and manner of any CASp inspection, the payment of the fee for the CASp inspection and the cost of making any repairs necessary to correct violations of construction-related accessibility standards within the premises.” If Lessee requests to perform a CASp inspection of the Premises, Lessee shall, at its cost, retain a CASp approved by Lessor to perform the inspection of the Premises at a time agreed upon by the parties. Lessee shall provide Lessor with a copy of any report or certificate issued by the CASp (the “CASp Report”). Lessor and Lessee agree that any modifications necessary to correct violations of construction related accessibility standards identified in the CASp Report shall be the responsibility of Lessee.
30. GENERAL PROVISIONS
A. If any provision of this Lease Agreement is deemed by a court of law to be invalid, void, illegal, or unenforceable, the parties intend and agree that shall in no way affect, impair or invalidate any other provision hereof and such other provisions that are not deemed invalid, void, illegal or unenforceable, shall remain in full force and effect.
B. This Lease Agreement and the obligations of Lessee hereunder shall not be affected or impaired because Lessor is unable to fulfill any of its obligations hereunder or is delayed in doing so, if such inability or delay is caused by reason of strike, labor troubles, acts of God, or any other cause beyond the reasonable control of Lessor.
C. This Lease Agreement contains all of the agreements of the parties hereto with respect to any matter covered or mentioned in this Lease Agreement. No provision of this Lease Agreement may be amended or added to except in writing signed by the parties hereto or their respective successors in interest. This Lease Agreement shall not be in effect or be binding on any party until fully executed by both parties hereto.
D. In the event of any sale or transfer of the Premises by Lessor, Lessor shall be and is hereby entirely freed and relieved of all liability under any and all of its covenants and obligations contained in or derived from this Lease arising out of any act, occurrence or omission occurring after the consummation of such sale or transfer; and the purchaser or transferee, at such sale or transfer or any subsequent sale or transfer of the Premises shall be deemed, without any further agreement between the parties or their successors in interest or between the parties and any such purchaser or transferee, to have assumed and agreed to carry out any and all of the covenants and obligations of Lessor under this Lease Agreement.
E. Animals will not be allowed on the Premises unless written permission is granted by Lessor.
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F. Lessee shall comply with all applicable federal, state, and local laws, including all laws regarding the possession, service, and distribution of alcoholic beverages.
G. Lessee will not, in any activity conducted on the leased Premises, or in any other manner, discriminate against any person on the grounds of race, color, religion, age, sex, sexual orientation, or national origin. Failure to comply with this provision will be considered a breach.
H. Campers, boats, mobile homes, recreational vehicles, inoperable vehicles or unlicensed or unregistered vehicles may not be parked on the Property for more than three (3) consecutive days.
I. Section headings have been inserted solely as a matter of convenience and are not intended to define or limit the scope of any of the provisions contained therein.
J. This Lease shall be construed and enforced in accordance with the Laws of the State of California, without reference to its choice of laws provisions.
K. Nothing herein is intended to create any third party benefit. ***
[Signatures on Next Page]
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IN WITNESS WHEREOF, the parties have executed this Lease Agreement as of the date first written above.
LESSOR:
CITY OF PACIFICA
By: __________________
Name: __________________
Its: __________________
LESSEE:
ART GUILD OF PACIFICA
By: __________________
Name:
Its: President
By: __________________
Name:
Its: Secretary
[Attach exhibits A, B and C]
ATTEST:
____________________________
Sarah Coffey, City Clerk
APPROVED AS TO FORM:
____________________________
Michelle Marchetta Kenyon, City Attorney
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EXHIBIT A
LEGAL DESCRIPTION
Real property in the City of Pacifica, County of San Mateo, State of California, described as follows:
Assessors Parcel No. 0232-811-30
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EXHIBIT B
PROPERTY AND PREMISES DEPICTION
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EXHIBIT C
RENT SCHEDULE
(ART GUILD)
Base Rent Adjustment Date Base Rent
January 1, 2026 $2,353.00
January 1, 2027 $2,412.00
January 1, 2028 $2,472.00
January 1, 2029 $2,534.00
January 1, 2030 $2,597.00