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ZACKS, FREEDMAN & PATTERSON, PC
235 MONTGOMERY STREET, SUITE 400
SAN FRANCISCO, CALIFORNIA 94104
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Andrew M. Zacks (SBN 147794)
Mark B. Chernev (SBN 264946)
ZACKS, FREEDMAN & PATTERSON, PC
235 Montgomery Street, Suite 400
San Francisco, CA 94104
Tel: (415) 956-8100
Fax: (415) 288-9755
Email: mark@zfplaw.com
Attorneys for Defendant and Cross-Complainant,
The American College of Traditional
Chinese Medicine at California Institute
of Integral Studies
ELECTRONICALLY
FILED
Superior Court of California,
County of San Francisco
05/01/2020
Clerk of the Court
BY: MADONNA CARANTO
Deputy Clerk
SUPERIOR COURT - STATE OF CALIFORNIA
COUNTY OF SAN FRANCISCO — UNLIMITED CIVIL JURISDICTION
SUSAN MITCHELL,
Plaintiff,
vs.
THE AMERICAN COLLEGE OF
TRADITIONAL CHINESE MEDICINE AT
CALIFORNIA INSTITUTE OF INTEGRAL
STUDIES and DOES 1-20, inclusive,
Defendants.
THE AMERICAN COLLEGE OF
TRADITIONAL CHINESE MEDICINE AT
CALIFORNIA INSTITUTE OF INTEGRAL
STUDIES,
Cross-Complainant,
vs.
SUSAN MITCHELL and ROES 1-10,
inclusive,
Cross-Defendants.
Case No.: CGC-19-579141
UNIFIED EXHIBITS IN SUPPORT OF
DEFENDANT/CROSS-COMPLAINANT
THE AMERICAN COLLEGE OF
TRADITIONAL CHINESE MEDICINE
AT CALIFORNIA INSTITUTE OF
INTEGRAL STUDIES’ MOTION FOR
SUMMARY ADJUDICATION
Date: July 21, 2020
Time: 9:30 a.m.
Dept.: 501
Hon.: Judge Charles F. Haines
Action Filed: September 10, 2019
Trial Date August 24, 2020
1
UNIFIED EXHIBITS IN SUPPORT OF MOTION FOR SUMMARY ADJUDICATIONZACKS, FREEDMAN & PATTERSON, PC
235 MONTGOMERY STREET, SUITE 400
SAN FRANCISCO, CALIFORNIA 94104
oO wm I DH RB WN
Defendant and Cross-Complainant, The American College of Traditional Chinese Medicine at
California Institute of Integral Studies (“C(ACTCM”) hereby submits the following unified
Exhibits in Support of its Motion for Summary Adjudication, for the convenience of the Court
in reviewing the moving papers and supporting declarations. Plaintiff and Cross-Defendant
Susan Mitchell is also referred to as “Mitchell”.
The Exhibits attached hereto are numbered as referenced in the supporting papers
which incorporate the Exhibits therein by reference. Those Exhibits are listed as follows:
Exhibit 1: Lease dated June 2012, executed June 21 and 28, 2012, between Jolish 1731
15" Street LLC, Z Glass 15" Street Mission LLC on one hand, and The
American College of Traditional Chinese Medicine on the other hand.
Exhibit 2: ACTCM Lease Addendum executed July 12 and 15, 2012 between Jolish 1731
15" Street LLC, Z Glass 15" Street Mission LLC on one hand, and The
American College of Traditional Chinese Medicine on the other hand.
Exhibit 3: Lease Addendum “Addendum 2” effective July 1, 2013 between Susan Mitchell
on one hand and California Institute of Integral Studies on the other hand.
Exhibit 4: July 2, 2018 letter to Laura Cambpell from Andrew Zacks.
Exhibit 5: San Francisco Letter of Determination RE: 1731 15" Street, Block: 3555 Lot:
056, dated July 19, 2010.
Exhibit 6: San Francisco Planning Code §102 definition of “Group Housing” (as amended
from §798.88(b) per File No. 170204, Ordinance No. 130.17 “Planning Code —
Deletion of Duplicate Definitions and Outdated Article 7 Zoning Control
Tables, July 20, 2017).
Exhibit 7: San Francisco Planning Code §102 definition of “Post-Secondary Educational
Institution”.
Exhibit 8: San Francisco Planning Code §304.5 Institutional Master Plans.
Exhibit 9: San Francisco Planning Code §317 Loss of Residential and Unauthorized Units
2
UNIFIED EXHIBITS IN SUPPORT OF MOTION FOR SUMMARY ADJUDICATIONZACKS, FREEDMAN & PATTERSON, PC
235 MONTGOMERY STREET, SUITE 400
SAN FRANCISCO, CALIFORNIA 94104
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Exhibit 10:
Exhibit 11:
Exhibit 12:
Exhibit 13:
Exhibit 14:
Exhibit 15:
Exhibit 16:
Exhibit 17:
Exhibit 18:
Exhibit 19:
Exhibit 20:
Exhibit 21:
Exhibit 22:
Exhibit 23:
Exhibit 24:
Exhibit 25:
Exhibit 26:
Exhibit 27:
Exhibit 28:
Through Demolition, Merger and Conversion.
ACTCM’s Request for Production of Documents, Set One, served on Mitchell,
dated 12/18/2019.
ACTCM’s Special Interrogatories, Set One, served on Mitchell, dated
12/18/2019.
ACTCM’s Requests for Admissions, Set One, served on Mitchell, dated
12/18/2019.
ACTCM’s Form Interrogatories, Set One, served on Mitchell, dated 12/18/2019.
ACTCM’s Proof of Service for discovery served on Mitchell, 12/18/2019.
Mitchell’s Responses to Request for Production of Documents, Exhibit 10.
Mitchell’s Responses to Special Interrogatories, Exhibit 11.
Mitchell’s Responses to Requests for Admissions, Exhibit 12.
Mitchell’s Responses to Form Interrogatories, Exhibit 13.
Mitchell’s Document Production Bates stamped SM1731000001 through
SM1731000135 (not attached in their entirety).
Letter from Mark Chernev to Laura Campbell, dated March 3, 2020.
Mitchell’s Amended Responses to Request for Production, dated March 20,
2020.
Mitchell’s Amended Responses to Special Interrogatories, dated March 20,
2020.
Mitchell’s Amended Responses to Request for Admission, dated March 20,
2020.
Mitchell’s Amended Responses to Form Interrogatories, dated March 20, 2020.
Email from Shane Kolding to Mark Chernev, dated March 20, 2020.
Mitchell’s Second Document Production, Bates stamped SM1731000136
through SM1731000288.
Email from Shane Kolding to Mark Chernev, dated March 24, 2020.
Mitchell’s Document Production Bates stamped SM1731000156 and
3.
UNIFIED EXHIBITS IN SUPPORT OF MOTION FOR SUMMARY ADJUDICATIONZACKS, FREEDMAN & PATTERSON, PC
235 MONTGOMERY STREET, SUITE 400
SAN FRANCISCO, CALIFORNIA 94104
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Exhibit 29:
Exhibit 30:
Exhibit 31:
Exhibit 32:
Exhibit 33:
Exhibit 34:
Exhibit 35:
Exhibit 36:
Exhibit 37:
Exhibit 38:
Exhibit 39:
Exhibit 40:
Exhibit 41:
Exhibit 42:
SM1731000156.
Invoice for $66,935.43 from Mitchell to ACTCM and Balance Sheet.
Invoice for $15,899.75 from Mitchell to ACTCM and Balance Sheet.
Invoice for $20,190.99 from Mitchell to ACTCM and Balance Sheet.
Emails as Mitchell’s Document Production Bates stamped SM1731000138,
SM1731000152, SM1731000156, and SM1731000158.
Emails as Mitchell’s Document Production Bates stamped SM1731000157,
SM1731000158, and SM1731000159.
Five Checks dated July 16, 2018 and one check dated April 10, 2018, check
numbers 2600164021, 2600164022, 2600164023, 2600164024, 2600164025,
and 77460 respectively, made out to Susan Mitchell from the City and County
of San Francisco,
Letter from Andrew Zacks to Laura Campbell, dated July 2, 2018.
Email thread and questionnaire from Barak Jolish to Michael Sano, dated
February 27, 2014.
Email from Florent Bernard to Dustin DeVan, Nelson Ma, 1731 15", Michael
Sano, and Cindy Ochoa, dated July 2, 2014.
Letter from Laura Campbell to Lixin Huang, dated June 6, 2018.
San Francisco Residential Rent Stabilization and Arbitration Board Petition and
Decision in Case No. T172228, In Re: 1731 15" Street, #2J, Jong Seto, Tenant
Petitioner, and California Institute of Integral Studies, Landlord Respondent,
dated March 8, 2018.
Letter from Andrew Zacks to Laura Campbell, dated June 18, 2018.
Complaint for Damages, Susan Mitchell, Plaintiff v. The American College of
Traditional Chinese Medicine at California Institute of Integral Studies,
Defendant, CGC-19-579141, Superior Court of the State of California, City and
County of San Francisco, dated September 10, 2019.
Cross-Complaint for Damages, Cross-Complainant The American College of
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UNIFIED EXHIBITS IN SUPPORT OF MOTION FOR SUMMARY ADJUDICATIONZACKS, FREEDMAN & PATTERSON, PC
235 MONTGOMERY STREET, SUITE 400
SAN FRANCISCO, CALIFORNIA 94104
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Traditional Chinese Medicine at California Institute of Integral Studies v. Susan
Mitchell, Cross-Defendant, CGC-19-579141, Superior Court of the State of
California, City and County of San Francisco, dated October 18, 2019.
Date: May 1, 2020 _ a oo
Mark B, Chernev
ZACKS, FREEDMAN & PATTERSON, PC
Attorneys for Defendant and Cross-Complainant,
The American College of Traditional
Chinese Medicine at California Institute
of Integral Studies
5.
UNIFIED EXHIBITS IN SUPPORT OF MOTION FOR SUMMARY ADJUDICATIONEXHIBIT 1LEASE
By and Between
JOLISH 1731 15" STREET LLC, and Z GLASS 15"" STREET
MISSION LLC
(collectively, “LANDLORD’)
and
THE AMERICAN COLLEGE OF TRADITIONAL CHINESE
MEDICINE,
(‘TENANT’)Lease Date:
Landlord:
Landlord’s Address:
Send Rent Payments to:
Tenant:
BASIC LEASE INFORMATION
June __, 2012
Jolish 1732 15 Street LLC and Z Glass 15"° Street Mission LLC
c/o Barak Jolish
PO Box 31814
San Francisco, CA 94131
Phone: 415 640 4468
Email: bjolish@yahoo.com
Barak Jolish
PO Box 31814
San Francisco, CA 94131
The American College of Traditional Chinese Medicine
Premises:
455 Arkansas Street
San Francisco, CA 94107
Contact: Lixin Huang, President
Phone: 415-282-7600
Email: LixinHuang@actcm.edu
1731 15" Street, San Francisco, CA, consisting of 1 single
occupant dorm rooms on the first and second floors (see
Exhibit A)
Pro-rata Share of Real Estate Taxes: The percentage of the total 49 rooms that the
Landlord Work
Tenant leases. Initially, this will be 28.6% (14 of
49)
The work that Landlord is obligated to perform in the
Premises pursuant to a separate agreement (the “Work
Letter”) attached to this Lease as Exhibit C.Section 2, Term
Term:
Term Commencement Date:
Lease Expiration Date:
Right of Early Termination:
Section 3, Rent
Base Rent:
Annual Rent Adjustment:
Rent Structure:
Section 4, Use:
Section 5,
Utilities & Maintenance:
Section 6, Real Estate
Five Years.
Upon Substantial Completion of the Landlord Work,
estimated to be July 1, 2013
Five (5) years after the Term Commencement Date
Tenant shall have the right to terminate the Lease ona date
prior to the Lease Termination Date, under the conditions
specified in Section 2.2 of the Lease.
$11,900 a month, for the first year of the Term, and $12,390 a
month for the second year of the Term; provided, however,
for the initial six (6) fall months of the Term (‘Start-Up
Period”), Base Rent shall be calculated based on the number
of rooms occupied by Tenant multiplied by $850 per month
per occupied room.
Base Rent to increase 3-0% annually commencing at the
beginning of the third year of the Term.
Modified Net, as described below.
Tenant shall use the space to provide single-occupancy
dormitory housing for students, faculty and staff, and for no
other purpose.
Landlord shall furnish reasonable quantities of electricity, gas,
water and sewer, garbage services and other services to the
Premises, as specified in Section 5-1.
Tenant’s Real Estate Tax obligations specified in Section 6.1,
$11,900
vuDefinitions:
“Alterations”
“Base Rent”
“Building”
“Common Area”
“Development Rights”
‘Environmental Law”
“Event of Default”
“Hazardous Materials”
“Holdover Rent”
“Late Fee”
“Laws”
“Lease Expiration Date”
“Modified Net Lease”
“Mortgagees”
“Permitted Materials”
“Premises”
“Premises Costs”
“Premises Rentable Area”
“Property”
‘Real Estate Taxes”
“Rent”
“Rent Adjustment Date”
“Returned Check Charge”
“Security Deposit”
“Surrender Date”
“Tenant's Property”
“Term”
“Term Commencement Date”
The following terms are defined in the Sections referenced below:
Section 7
Section 3.1
Section 1.4
Section 1.2
Section 4.4
Section 15.1
Section 12.1
Section 15.1
Section 2.4
Section 3.4
Section 4.3
Section 2.1
Section 3.3
Section 13
Section 15.1
Section 1.1
Section 3.3
Section 1.1
Section 11
Section 6
Section 3.3
Section 3.1
Section 3.5
Section 16
Section 2.3
Section 2.3
Section 2.1
Section 2.1
The Basic Lease Information is incorporated into this Lease. In the event of a
conflict between any Basic Lease Information and the Lease,
the Lease shall control.LEASE
This Lease (“Lease”) is entered into as of the Lease Date specified in the Basic Lease
Information by and between JOLISH 1731 15"" STREET LLC, AND Z GLASS 15"" STREET
MISSION LLC (collectively, “Landlord”) and The American College of Traditional Chinese
Medicine (“Tenant”).
Section1. PREMISES
Li Premises. Subject to the following terms, covenants and conditions,
Landlord leases to Tenant and Tenant leases from Landlord those certain premises (the
“Premises”) consisting of 14 dormitory rooms on the first and second floors of the building
located at 1731 is? Street, San Francisco, California (the “Building”). The Building, the land
and the common area appurtenant to the Building, are sometimes collectively called the
“Property”. Landlord reserves the right to alter the Property so long as such alterations do
not unreasonably impair access to the Premises. Tenant acknowledges that Landlord has
made no representation or warranty regarding the condition of the Premises or the Building
or its fitness for the conduct of Tenant’s business, except as specifically set forth in this
Lease.
1.2. Common Area. Tenant shall have the non-exclusive use of the common
areas (“Common Area”) of the Building. Landlord shall maintain the Common Area,
including the fixtures, furnishings and equipment (“FF&E”) installed by Landlord in a good
and serviceable condition. Any damage to the Common Area and FF&E caused by Tenant in
excess of ordinary wear and tear shall be repaired or replaced by Landlord at Tenant’s
expense. Landlord shall have right to remove from the Common Area any items, including
furniture, which is not authorized in advance to be located in the Common Area.
1.3 Expansion Right of First Offer. Tenant shall have the right of first
offer (the "Right of First Offer") during the Term (as the same may be extended) to lease
twenty (20) additional dormitory rooms as a single block located on the third floor of the
Building (the "Offering Space"). Tenant's Right of First Offer shall be exercised as follows:
at any time after Landlord has determined that the Offering Space is vacant and available to
be leased (but prior to leasing such Offering Space to a party other than an existing tenant),
Landlord shall advise Tenant (the "Advice") of the of the availability of the Offering Space.
Tenant may lease such Offering Space in its entirety only, under the terms of this Lease
{including the then applicable Base Rent and Lease Expiration Date), by delivering written
notice of exercise to Landlord (the “Notice of Exercise") within 10 days after the date of the
Advice, except that Tenant shall have no such Right of First Offer and Landlord need not
provide Tenant with an Advice, if: (a) Tenant is in default under the Lease beyond any
applicable notice and cure period; (b) Tenant has assigned the Lease (other than to a
Permitted Transferee), sublet the Premises (other than to a Permitted Transferee) or is
otherwise not occupying the Premises; or (c) Tenant does not intend to use the Offering
Space for the use permitted by the Lease. If Tenant is entitled to and properly exercises theRight of First Offer, Landlord shall prepare an amendment (the "Expansion Amendment") to
reflect the commencement date of the term for the Offering Space and the changes in Base
Rent, Tenant's Pro Rata Share of Real Estate Taxes and other appropriate terms which shall
be coterminous with the remaining Term of the Premises, and shall be at the same Base
Rent and terms as for the Premises as of the time of exercise. Possession of the Offering
Space shall be delivered to Tenant in a condition comparable to the condition of the
Premises as of the Term Commencement Date. A copy of the Expansion Amendment shall
be sent to Tenant within a reasonable time after Landlord’s receipt of the Notice of Exercise,
and Tenant shall execute and return the Expansion Amendment to Landlord within fifteen
(a5) days thereafter, and Landlord shall return an executed copy to Tenant fifteen (5) days
thereafter, but an otherwise valid exercise of the Expansion Option shall be fully effective
whether or not the Expansion Amendment is executed.
Section2, TERM
2.1 Term. The term of the Lease (‘Term’) is five (5) years, commencing on the
“Term Commencement Date” and ending on the “Lease Expiration Date” as specified in
the Basic Lease Information. The Term Commencement Date shall be the date on which the
Landlord Work is “Substantially Complete”, but no earlier than July 1, 2013 unless agreed to
in writing by Landlord and Tenant. The Landlord Work shall be deemed to be
“Substantially Complete” on the later of (i) the date that the Landlord Work has been
performed, other than any details of construction, mechanical adjustment or any other
similar matter, the non-completion of which does not materially interfere with Tenant’s use
of the Premises; and (ii) the date Landlord receives from the appropriate governmental
authorities, with respect to the Landlord Work, all approvals necessary for the occupancy of
the Premises. If Landlord is delayed in the performance of the Landlord Work as a result of
the negligent acts or omissions of Tenant or its contractors or vendors, including, without
limitation, changes requested by Tenant to approved plans, Tenant’s failure to comply with
any of its obligations under this Lease, or the specification of any materials or equipment
with long lead times (a “Tenant Delay”), the Landlord Work shall be deemed to be
Substantially Complete on the date that Landlord could teasonably have been expected to
Substantially Complete the Landlord Work absent any Tenant Delay.
2.2 Lease Contingency; Option of Termination. This Lease is expressly
contingent upon Landlord obtaining all necessary approvals and permits from the City of
San Francisco to complete Landlord’s Work in accordance with the Approved Plans.
Following the full execution of this Lease, Landlord shall use commercially reasonable and
diligent efforts to obtain the foregoing approvals and permits. In the event Landlord is
unable to obtain such approvals and permits on or before June 15, 2013, then Tenant shall
have the option to terminate this Lease by delivering written notice to Landlord on or before
Landlord’s notice to Tenant that Landlord has obtained the approvals and permits.
Additionally, provided that Tenant is not in Default, Tenant shall have the option toterminate the Lease by written notice to Landlord in the event the Landlord has not
delivered the Premises to Tenant with Landlord’s Work Substantially Complete on or before
July 1, 2013 (“Outside Completion Date”). Tenant’s exercise of the termination notice
pursuant to the preceding sentence shall only be effective if delivered to Landlord no later
than thirty (30) days following the Outside Completion Date. If Tenant timely exercises
either of the foregoing termination options, then the Lease shall terminate effective as of the
delivery of such notice and the rights and obligations of the parties to the Lease shall cease,
except for those rights and obligations which expressly survive termination of this Lease.
2.3 Surrender. At the end of the Term, or at the end of any subsequent
holdover period permitted by Landlord or upon any earlier termination of this Lease (the
date of surrender being referred to as the “Surrender Date”), Tenant shall peaceably
surrender the Premises “broom” clean and in good order, repair and condition, ordinary
wear and tear and casualty damage excepted. The Alterations (as defined in Section 7) shall
remain the property of Tenant during the Term. Unless otherwise agreed at the time
Landlord’s approval is requested for Tenant's Alterations, all such Alterations shall become
the property of Landlord at the end of the Term or earlier expiration of this Lease and be
deemed a part of the Premises.
On or before the Surrender Date, Tenant shall remove from the Premises all trade
fixtures, furnishings, equipment, and other personal property installed by Tenant
(collectively, “Tenant’s Property’), and shall repair any damage to the Premises resulting
from such removal.
If Tenant fails to remove any of Tenant's Property, or restore the Premises to the
condition specified herein on the Surrender Date, Landlord shall have the right, in addition
to such other rights and remedies as may be available at law or in equity, to perform all such
removal and restoration at Tenant’s sole cost and without notice or any other obligation to
Tenant (including without limitation any obligation to mitigate damages or realize salvage
value). Any of Tenant’s Property not removed by Tenant on or before the Surrender Date
shall be considered abandoned, and Landlord may remove any or all of Tenant’s Property
and dispose of it in any lawful manner, or may store any of Tenant's Property in a public
warehouse or elsewhere for the account and at the expense and risk of Tenant.
2.4 Holdover. If Tenant holds over after the expiration or earlier termination of
the Term with Landlord’s prior written consent, (a) Tenant’s occupancy of the Premises shall
be deemed a month-to-month tenancy terminable by either party upon 30 days’ written
notice to the other, (b) the monthly Rent during the holdover period shall be 125% of the
monthly Rent during the last month of the Term and (c) Tenant’s occupancy of the Premises
during the holdover period otherwise shall be subject to all applicable terms and conditions
of this Lease. If Tenant holds over after the expiration or earlier termination of the Term
without Landlord’s prior written consent, Tenant shall be deemed a tenant at sufferance and
Tenant's occupancy of the Premises during the holdover period otherwise shall be subject to
all applicable terms and conditions of this Lease, except the monthly Rent during the
7holdover period (“Holdover Rent”) shall be 125% of the monthly Rent during the last month
of the Term.
25 Renewal Option. Provided that (a) this Lease is in full force and effect, (b)
Tenant is not then in default in the performance of any of the terms and conditions of this
Lease (beyond the expiration of any applicable period for cure), (c) Tenant has not assigned
this Lease (other than to a Permitted Transferee), and (d) Tenant (or a Permitted
Transferee) is in occupancy for its own use of the entire Premises (collectively, the "Option
Conditions"), Tenant shall have two (2) options to extend the term of this Lease fora period
of five (5) years each, subject to the following conditions: () each option shall be exercised
by written notice of exercise given to Landlord by certified mail, with return receipt, or by
hand delivery not earlier than 12 months or later than 9 months prior to the expiration, as
applicable, of the original Lease Expiration Date or the initial extension term; and (ii) the
Option Conditions shall be satisfied both at the time the option is exercised and at the
commencement of the extension term. In the event the option is timely exercised, the Term
of this Lease shall be extended for a period of five (5) years upon all of the terms and
conditions of this Lease and the Base Rent during such extended term shall be ninety
percent (90%) of the Fair Market Rental Rate.
rentals then being charged for comparable dormitory properties in San Francisco, taking
into account the length of the extension term, the rental structure, the fixed increases in
Base Rent during the extension term provided for herein, the manner of pass-through of
additional rent, free or reduced rent periods, any improvements or improvement allowance
made to the Premises, and any brokerage commissions directly related to dormitory room
leasing transactions. Within thirty (30) days following Tenant's exercise of the option to
extend, Landlord shall deliver written notice to Tenant specifying Landlord’s determination
of the Fair Market Rental Rate for the Premises as of the commencement of the extension
term (“Landlord's Determination”). Within fifteen (15) days following Tenant’s receipt of
such Landlord’s notice specifying Landlord’s Determination, Tenant shall deliver written
notice to Landlord either agreeing with Landlord’s Determination or disagreeing therewith
and specifying Tenant's determination of the Fair Market Rental Rate of the Premises as of
the commencement of the extension term (“Tenant’s Determination”). In the event Tenant
fails to timely deliver such notice, then Landlord’s Determination shall be binding on
Tenant. In the event Tenant so disagrees with Landlord’s Determination, then Landlord and
Tenant shall promptly meet and endeavor in good faith to reach agreement upon the Fair
Market Rental Rate for the extension term. Upon agreement, Landlord and Tenant shall
enter into a renewal amendment. Notwithstanding the foregoing, if Landlord and Tenant
fail to agree upon the Fair Market Rental Rate within thirty (30) days after the date Tenant
provides Landlord with Tenant’s Determination, Tenant, by written notice to Landlord (the
“Arbitration Notice") within five (5) days after the expiration of such thirty (30) day period,
shall have the right to have the Fair Market Rental Rate determined in accordance with the
arbitration procedures described below.If Tenant provides Landlord with an Arbitration Notice, Landlord and Tenant,
within five (5) days after the date of the Arbitration Notice, shall each simultaneously
submit to the other, in a sealed envelope, its good faith estimate of the Fair Market Rental
Rate for the Premises (collectively referred to as the "Estimates"). If the higher of such
Estimates is not more than 105% of the lower of such Estimates, then Fair Market Rental
Rate shall be the average of the two Estimates. If the Fair Market Rental Rate is not resolved
by the exchange of Estimates, then, within seven (7) days after the exchange of Estimates,
Landlord and Tenant shall each select an appraiser to determine which of the two Estimates
most closely reflects the Fair Market Rental Rate for the Premises. Each appraiser so
selected shall be certified as an MAI appraiser or as an ASA appraiser and shall have had at
least five (5) years experience within the previous ten (10) years as a real estate appraiser
working in the San Francisco area, with working knowledge of current rental rates and
practices for similar space. For purposes hereof, an "MAI" appraiser means an individual
who holds an MAI designation conferred by, and is an independent member of, the
American Institute of Real Estate Appraisers (or its successor organization, or in the event
there is no successor organization, the organization and designation most similar), and an
"ASA" appraiser means an individual who holds the Senior Member designation conferred
by, and is an independent member of, the American Society of Appraisers (or its successor
organization, or, in the event there is no successor organization, the organization and
designation most similar).
Upon selection, Landlord's and Tenant's appraisers shall work together in
good faith to agree upon which of the two (2) Estimates most closely reflects the Fair Market
Rental Rate for the Premises. The Estimate chosen by such appraisers shall be binding on
both Landlord and Tenant as the Minimum Rent rate for the Premises during the extended
Lease Term. If either Landlord or Tenant fails to appoint an appraiser within the seven (7)
day period referred to above, the appraiser appointed by the other party shall be the sole
appraiser for the purposes hereof. If the two appraisers cannot agree upon which of the two
(2) Estimates most closely reflects the Fair Market Rental Rate within twenty (20) days after
their appointment, then, within ten (10) days after the expiration of such twenty (20) day
period, the two appraisers shall select a third appraiser meeting the aforementioned criteria.
Once the third appraiser (i.e. arbitrator) has been selected as provided for above, then, as
soon thereafter as practicable but in any case within fourteen (14) days, the arbitrator shall
make his determination of which of the two Estimates most closely reflects the Fair Market
Rental Rate and such Estimate shall be binding on both Landlord and Tenant. If the
arbitrator believes that expert advice would materially assist him, he may retain one or more
qualified persons to provide such expert advice. The parties shall share equally in the costs
of the arbitrator and of any experts retained by the arbitrator. Any fees of any appraiser,
counsel or experts engaged directly by Landlord or Tenant, however, shall be borne by the
party retaining such appraiser, counsel or expert.
If the Fair Market Rental Rate has not been determined by the commencement
date of the extended Lease Term, Tenant shall pay Base Rent upon the terms and conditions
in effect during the last month of the original Term or first extension term, as applicable, for
9the Premises until such time as the Fair Market Rental Rate has been determined. Upon
such determination, the Base Rent for the Premises shal] be retroactively adjusted to the
commencement of the extended Lease Term.
Section 3. RENT
31 Base Rent. Tenant shall pay the monthly Base Rent (“Base Rent”) specified in
the Basic Lease Information. The Base Rent shall be due on the first day of each and every
month during the Term, without notice, set off, or invoice from Landlord. The Base Rent for
any partial month shall be pro-rated at the rate of 1/30 of the monthly Base Rent per day.
During the Start-Up Period, Base Rent shall be determined based on actual occupancy of the
dormitory rooms comprising the Premises, pro-rated as provided above. Tenant shall certify
in writing to Landlord at the beginning of each month during the Start-Up Period the
number of rooms occupied and the date occupancy commenced for each room and Base
Rent shall be determined in accordance with such certification.
3-2 Rent Adjustment. Base Rent shall increase annually by three percent (3.0%)
during the final three years of the Term
3:3 Modified Net Lease; Rent Defined. This Lease is a “Modified Net Lease”
pursuant to which Tenant shall pay (in addition to Base Rent) for its Pro-Rata Share of Real
Estate Taxes. Tenant will petition the City of San Francisco for exemptions from real estate
taxes based on its non-profit status.
For purposes of this Lease, “Rent” shall mean and include all amounts and charges
Tenant is obligated to pay under this Lease, including Base Rent, Tenant's Pro-rata Share of
Real Estate Taxes, Late Fees (Section 3.4), Returned Check Charge (Section 3.5) and interest
(as provided in this Lease). Unless as otherwise provided herein, Tenant shall pay the Rent
to Landlord at the times set forth in this Lease, without deduction, setoff, prior notice or
demand, in lawful money of the United States of America, at the address specified in the
Basic Lease Information, or to such other person and/or at such other address as Landlord
may designate in writing from time to time.
3-4 Late Payment. Tenant recognizes that late payment of any Rent or other sum
due hereunder from Tenant to Landlord shall incur costs and expenses not originally
contemplated under this Lease; including but not limited to certain administrative expenses,
collection costs, processing, and accounting expenses, the extent of which additional
expense is extremely difficult and economically impractical to ascertain. Tenant therefore
agree that if Rent or any other payment due hereunder from Tenant to Landlord remains
unpaid ten (10) days after said amount is due, the amount of such unpaid Rent or other
payment shall be increased by a “Late Fee” to be immediately paid to Landlord by Tenant in
an amount equal to Five Percent (5%) of said Rent or other sum that remained unpaid for
the above mentioned ten (10) day period. Both parties agree that such amount is a
reasonable estimate of the loss and expense to be suffered by Landlord as a result of such
late payment by Tenant and may be charged by Landlord to defray such loss and expense.
10The provisions of this Section 3.4 in no way relieve Tenant of the obligation to pay Rent or
other payments on or before the day on which they are due, nor do the terms of this Section
3.4 in any way affect Landlord’s remedies pursuant to this Lease in the event said Rent or
other payment is unpaid after the date due.
3.5 Returned Check Charge. In the event Tenant’s payment of Rent to Landlord in
the form of a check is returned for insufficient funds, Tenant shall pay to Landlord a
returned check charge (“Returned Check Charge”) of $25.00, which shall be submitted by
Tenant along with the Rent due within five (5} days of written notice by Landlord. Such
Returned Check Charge shall be in addition to any late payment charges incurred and shall
be deemed additional Rent. After two such Returned Check Charges, Tenant shall submit
all subsequent Rent payments to Landlord in the form of a cashier's check or money order
only.
Section 4. USE OF PREMISES; COMPLIANCE WITH LAWS; SIGNAGE
41 Permitted Use. The Premises shall be used only for the use specified in the
Basic Lease Information and related uses. Tenant agrees at all times to use its best efforts to
conduct and carry on Tenant’s business in such a manner that no loud noises, including
amplified sound, or odors shall emanate from the Premises. In the event that the operation
of Tenant’s business causes noise or disturbances to other tenants in the Building, Tenant
agrees to take prompt and reasonable steps to reduce the level of noise emanating from the
Premises. Tenant agrees to otherwise abide by the rules and regulations set forth in Exhibit
“B” of this Lease to ensure the peaceful enjoyment of the Property by all tenants of the
Building.
4.2 Prohibited Uses. Tenant shall not use or allow the Premises to be used for
any improper, immoral or unlawful purpose, nor shall Tenant cause, maintain or permit any
nuisance or waste in, on or about the Premises. Tenant shall not allow the Premises to be
occupied by vagrants or visitors who are not students, faculty or staff who are not using the
services of Tenant’s business. The Premises shall not be used for any purpose not specified
in the Basic Lease Information without Landlord’s prior written consent. Tenant agrees not
to conduct or permit to be conducted any fire sale or any sale by auction on the Premises.
Premises rooms are for single occupancy only, unless otherwise agreed to in writing by
Landlord. No guest of a dormitory room occupant may stay on the Premises for more than
three (3) consecutive nights.
4.3 Compliance with Laws. Tenant shall comply with, and shall not use or
occupy the Premises or allow the Premises to be used or occupied in violation of, (a) any
law, zoning restriction, ordinance, rule, regulation, requirement, order or decree of any
governmental or quasi-governmental agency with jurisdiction over Tenant or the Premises
(collectively, “Laws”), (b) the requirements of the Fire Marshal, the Board of Fire
Underwriters or any insurer or insurance authority, (c) any certificate(s) of occupancy issued
for the Premises or the Building, (d) any use permit issued for Tenant’s use of the Premises,
or (e) any recorded covenants, conditions and restrictions, or private contracts of which
nLTenant has actual knowledge and which affect the use and operation of the Premises.
Tenant shall procure, maintain and make available for Landlord’s inspection, at Tenant’s
sole cost, all governmental licenses and permits required for the proper and lawful conduct
of Tenant's operations and activities within the Premises and the Building. Tenant shall
observe and adhere to all occupancy restrictions established for the Premises.
44 Development Rights. Landlord expressly reserves from this Lease any and
all rights related to the development of the Property (collectively, “Development Rights’).
Tenant acknowledge that they have no right, title or interest in or to any Development
Rights, and shall have none at any time in the future. Tenant shall not take or cause any
action to be taken which could interfere with Landlord's exercise of its Development Rights
(which Landlord shall have no obligation to exercise for the benefit of Tenant), or which
could impair or otherwise affect any Development Rights.
4.5 Signage. Tenant shall not erect or install in, upon or about the Premises or
Building any exterior or interior signs or advertising media or window or door lettering or
placards without Landlord’s prior written consent which consent shall not be unreasonably
withheld, conditioned or delayed. Any signage approved by Landlord shall be subject to
approval by the applicable governing authorities. Tenant shall properly and promptly
maintain and repair its signs, and keep them ina neat and clean condition. Upon expiration
or sooner termination of this Lease, Tenant shall promptly remove all signs installed
hereunder and repair, patch and paint the exterior surface damaged by such removal.
Tenant shall not use any advertising media or other media that is objectionable to Landlord,
or which can be heard outside the Premises, such as loudspeakers, phonographs or radio
broadcasts.
Section 5. UTILITIES; MAINTENANCE AND REPAIRS
5.1 Utilities and Other Services. Both parties understand the Premises are not
separately metered for utilities, including electricity, water and sewer service. Tenant shall
pay its proportionate share of the Building’s services, as specified below. Except as expressly
provided otherwise herein, Tenant shall procure, at its sole cost, and timely pay for all other
services which Tenant may deem necessary in connection with Tenant's use, occupancy and
enjoyment of the Premises or performance of its obligations under this Lease, including
without limitation telephone, cable, Premises cleaning, and security as described below.
(a) Electric and Gas Service: Landlord shall pay for electric and gas service
furnished to the Building by Pacific Gas & Electric (“ 'G&E”). Landlord reserves the right to
impose reasonable energy conservation measures. Landlord also reserves the right to charge
back to Tenant and/or offset “Unreasonable Energy Expenses” from the Security Deposit.
“Unreasonable Energy Expenses” are expenses in excess of those required for lighting,
heating, and incidental electronics. Examples of Unreasonable Energy Expenses are those
caused by lights for indoor plant cultivation, operation of more than two computers per
individual, and excessive heating.(b) Water and Sewer Service: Landlord shall pay for the Building's water and
sewer service, as charged by San Francisco Public Utilities Commission. Landlord reserves
the right to impose reasonable water conservation measures.
(c) Trash Removal Service: Tenant is permitted use of the Building’s trash and
recycling bins, located in an area to be specified by Landlord (“Trash Area”). Landlord shall
pay for trash removal service, with no contribution from Tenant. Landlord reserves the right
to impose reasonable trash mitigation and recycling measures. Landlord also reserves the
right to charge back to Tenant and/or offset “Unreasonable Trash Removal Expenses” from
the Security Deposit. “Unreasonable Trash Removal Expenses” are expenses incurred for
trash generation in excess of those required for single-occupancy student rooms. Examples
of Unreasonable Trash Removal Expenses are trash generated from resident business uses,
art projects, or from furniture boxes.
(d) Cleaning Services: Landlord shall provide janitorial services to the Common
Areas on a regular schedule (schedule to be further defined by Landlord). Dormitory rooms
shall be cleaned by the occupants at their sole cost or arranged by Tenant at its sole cost,
and Tenant shall clean dormitory rooms between move-in and move-out and in the event
the occupants of the dormitory fail to maintain their rooms in a reasonably good condition.
In the event of extraordinary occupant neglect, Landlord may clean dormitory rooms, and
charge back to Tenant the cost of such cleaning and/or offset the cleaning fee against the
Security Deposit.
(e) Wireless/Telephone: Landlord, at its cost, shall provide a minimum of one (1)
Ti bandwidth internet connection (or equivalent) for the Building. Landlord will allow
Tenant dormitory room occupants to access this connection via secure wireless access
points. Tenant shall assist Landlord in obtaining favorable connectivity rates through
Tenant's service provider. Occupants of dormitory rooms shall be responsible for their own
telephone and data service providers. This connection is for limited {Internet usage only.
The downloading of large files (e.g., movies, large amounts of music) is prohibited.
(f) Security: The entrance to the Building shall be securely locked at all times.
Landlord shall furnish all occupants of the Building with card key access (or equivalent).
Notwithstanding the above, Landlord may charge a key deposit for a resident who loses his
or her initial key. Landlord shall not be responsible for providing any other means of
security for the Building, but Tenant shall be permitted to do so at its own expense with
written approval from Landlord. This approval shall not be unreasonably withheld so long
as such security does not interfere with the use of or access to the Building by other tenant
or occupants.
(g) On-Site Manager; Resident Advisors: Landlord shall provide an on-site
property manager at no additional expense to Tenant. Tenant shall designate an occupant
of a dormitory room of the Building leased by Tenant as a resident contact.
13(h) On-Site Laundry: Landlord shall provide and maintain for the use of the
occupants of the dormitory rooms a minimum of four (4) coin operated washer and dryer
units.
5.2 Landlord’s Repair and Maintenance Obligations. Landlord shall repair
and maintain in good working order and condition, at Landlord’s sole cost and expense
without reimbursement from Tenant, the Common Areas (as provided in Section 1.2), the
Building foundation and structural elements of the Premises and the Building, floor slab of
the Premises and the Building, exterior walls, window casements and moldings, roof of the
Building, elevator, security and fire/life safety systems serving the Building in general, and
the HVAC, electrical, phimbing and sewer systems that serve the Building in general;
provided that, Tenant shall bear the cost of (a) repairing any portion of the Common Areas
or Premises damaged by the action of Tenant, its employees, agents, contractors,
subtenant(s), assignees, guests or invitees, except for ordinary wear and tear and also except
to the extent covered by insurance, and (b) any structural or other work caused by or arising
from penetration of the Building (including its floor slab) by or on behalf of Tenant.
5.3 Tenant’s Repair and Maintenance Obligations. It shall be Tenant’s
responsibility at all times during the Term to ensure that the dormitory rooms and any FF&E
located therein are maintained in a good, neat and clean condition, free from excessive
trash.
5.4 Tenant Failure to Repair. If Tenant fails, for any reason, to repair and
maintain the Premises as required by this Lease to Landlord’s reasonable satisfaction within
ten (10) days after Landlord presents a written notice and demand for such repairs, Landlord
shall have the right, but not the obligation, to enter the Premises and perform such repairs
or maintenance without liability to Tenant for any loss or damage to Tenant’s Property or
interference with Tenant's occupancy arising there from. If Landlord performs such repairs
or maintenance, Tenant shall pay Landlord all reasonable costs thereof, plus 5% of such
costs for supervision, administration and overhead, within ten (10) days after receipt of
Landlord’s written invoice.
5-5 No Self-Help. Tenant waives and shall have no right to make repairs at
Landlord’s expense under any law, statute or ordinance now or subsequently in effect,
including without limitation the provisions of California Civil Code section 1942 and any
similar or successor statutes.
Section 6. REAL ESTATE TAXES,
61 Definitions. “Real Estate Taxes” shall mean all taxes, assessments, levies
and other charges, which are assessed or charged by a governmental or quasi-governmental
entity or agency upon the Property during the Term. Real Estate Taxes include (a) all taxes
on the assessed value of the Property (“Property Taxes”) and (b) all fees, assessments,
14excises or charges for transit, police, fire, housing, schools, other governmental services, or
purported benefits to the Building and service payments in lieu of taxes (“Assessments”).
The parties acknowledge that the Premises occupied by the Tenant may become
exempt from Property Taxes, in the event that Tenant applies for and receives its non-profit
tax exemption from the federal and state governments for the Premises on an annual basis.
Commencing as of the Term Commencement Date, Tenant is responsible for paying
Tenant's Pro-rata Share of any Real Estate Taxes due in the event Tenant fails to qualify or
apply for such tax exemption, to be billed back to the Tenant as explained below.
6.1 Tax Payments. Tenant shall Pay its tax payment (“Tax Payment”) based on the
Tenant’s Pro-rata Share of Real Estate Taxes within twenty (20) days after receiving a bill for
the Tax Payment from the Landlord. Landlord shall bill Tenant on a semi-annual basis
based on the schedule for tax payments for the City and County of San Francisco. Upon
request by the Tenant, Landlord shall provide Tenant with a copy of the previous year’s tax
bill for the Property to assist Tenant with preparing for the following year's estimated Tax
Payment.
Any Real Estate Taxes for the lease years in which the Term Commencement Date
commences and the Lease terminates shall be pro-rated between Landlord and Tenant to
the end that Tenant shall only pay such portion of the Real Estate Taxes as is included
within the Term of this Lease.
Section 7, ALTERATIONS AND IMPROVEMENTS.
Tenant shall make no alterations, additions, or improvements to the Premises
(collectively ‘Alterations”) without Landlord’s prior written consent. Tenant’s request for
Landlord’s approval of Alterations shall be accompanied by a written description of the
proposed Alterations, a set of plans and permit applications, the name, license number and
insurance certificate of the contractor(s), and such other information as Landlord
reasonably may request. Alterations shall be made or installed, at Tenant’s sole cost, only
after Landlord has approved the plans, specifications, and contractor in writing. At least
three days before Tenant commences construction of the Alterations, Tenant shall provide
Landlord with copies of all permit application approvals.
All Alterations shall be constructed in accordance with approved plans, and ina first-
class and workmanlike manner. The Property shall be kept clean and clear of debris during
construction. All contractors shall be licensed and shall have appropriate workers’
5compensation, general liability, and other required insurance. Each contractor shall be
required to indemnify Landlord against claims arising out of such contractor's acts and
omissions, and to name Landlord as additional insured under its general liability insurance
policy. Tenant shall not permit any mechanic's or other liens or encumbrances (collectively,
“Liens”) to be filed against all or any part of the Building. If any Lien is filed, Tenant shall
immediately cause the Lien to be discharged, released or bonded over, at no cost to
Landlord, so that the Lien has no further affect on the Building. Within three days after
completion of the Alterations, Tenant shall provide Landlord with copies of all approved job
cards and approvals from the San Francisco Building Department.
Section 8. QUIET ENJOYMENT
8.1 Landlord’s Covenant. Upon pa ying the Rent and performing all of its other
obligations under this Lease, Tenant shall peaceably and quietly have, hold and enjoy the
Premises in accordance with all the terms and conditions of this Lease against all persons
claiming an interest through Landlord.
8.2 Right of Entry. Upon prior written notice to Tenant of no less than 24 hours
(which may be provided by electronic mail), except in the event of a required emergency
repair, Landlord and Landlord’s agents, employees and contractors shall have the right to
enter the Premises at all reasonable times during normal business hours in order to inspect
the Premises, make repairs or improvements to the Premises or the Property as required by
this Lease, perform any of Landlord’s obligations as provided in this Lease, exercise any of
Landlord’s rights as provided in this Lease or show the Premises to prospective Mortgagees
{as defined in Section 13), purchasers or Tenant of the Premises, Landlord shall use
reasonable efforts to minimize interference with Tenant’s use of the Premises and provide
Tenant with reasonable advance notice of any such entry (except in emergency situations).
Landlord shall have the right to use any and all means it deems necessary or appropriate in
order to obtain entry to the Premises in case ofan emergency. Any such entry shall not be
construed to be a forcible or unlawful entry into the Premises, or an actual or constructive
eviction of Tenant from the Premises or any portion thereof.
Section 9. INDEMNIFICATION AND EXCULPATION
9.1 Indemnity. To the maximum extent permitted by law, Tenant shall indemnify,
defend, protect and hold Landlord and Landlord's, employees, agents, successors and
assigns harmless from and against any and all claims, losses, damages, liabilities and costs,
including without limitation reasonable attorneys’ fees and costs, arising out of or resulting
in whole or in part from (a) any negligent act or omission of Tenant or any of Tenant’s
employees, agents, contractors, Subtenant, assignees, licensees, guests or invitees; (b) any
failure by Tenant to perform any of its obligations under the Lease; or (c) any property
damage, bodily injury, personal
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ZACKS, FREEDMAN & PATTERSON, PC 235 MONTGOMERY STREET, SUITE 400 SAN FRANCISCO, CALIFORNIA 94104 oO wm ND BRB WN Be _ oe won Andrew M. Zacks (SBN 147794) Mark B. Chernev (SBN 264946) ZACKS, FREEDMAN & PATTERSON, PC 235 Montgomery Street, Suite 400 San Francisco, CA 94104 Tel: (415) 956-8100 Fax: (415) 288-9755 Email: mark@zfplaw.com Attorneys for Defendant and Cross-Complainant, The American College of Traditional Chinese Medicine at California Institute of Integral Studies ELECTRONICALLY FILED Superior Court of California, County of San Francisco 05/01/2020 Clerk of the Court BY: MADONNA CARANTO Deputy Clerk SUPERIOR COURT - STATE OF CALIFORNIA COUNTY OF SAN FRANCISCO — UNLIMITED CIVIL JURISDICTION SUSAN MITCHELL, Plaintiff, vs. THE AMERICAN COLLEGE OF TRADITIONAL CHINESE MEDICINE AT CALIFORNIA INSTITUTE OF INTEGRAL STUDIES and DOES 1-20, inclusive, Defendants. THE AMERICAN COLLEGE OF TRADITIONAL CHINESE MEDICINE AT CALIFORNIA INSTITUTE OF INTEGRAL STUDIES, Cross-Complainant, vs. SUSAN MITCHELL and ROES 1-10, inclusive, Cross-Defendants. Case No.: CGC-19-579141 UNIFIED EXHIBITS IN SUPPORT OF DEFENDANT/CROSS-COMPLAINANT THE AMERICAN COLLEGE OF TRADITIONAL CHINESE MEDICINE AT CALIFORNIA INSTITUTE OF INTEGRAL STUDIES’ MOTION FOR SUMMARY ADJUDICATION Date: July 21, 2020 Time: 9:30 a.m. Dept.: 501 Hon.: Judge Charles F. Haines Action Filed: September 10, 2019 Trial Date August 24, 2020 1 UNIFIED EXHIBITS IN SUPPORT OF MOTION FOR SUMMARY ADJUDICATIONZACKS, FREEDMAN & PATTERSON, PC 235 MONTGOMERY STREET, SUITE 400 SAN FRANCISCO, CALIFORNIA 94104 oO wm I DH RB WN Defendant and Cross-Complainant, The American College of Traditional Chinese Medicine at California Institute of Integral Studies (“C(ACTCM”) hereby submits the following unified Exhibits in Support of its Motion for Summary Adjudication, for the convenience of the Court in reviewing the moving papers and supporting declarations. Plaintiff and Cross-Defendant Susan Mitchell is also referred to as “Mitchell”. The Exhibits attached hereto are numbered as referenced in the supporting papers which incorporate the Exhibits therein by reference. Those Exhibits are listed as follows: Exhibit 1: Lease dated June 2012, executed June 21 and 28, 2012, between Jolish 1731 15" Street LLC, Z Glass 15" Street Mission LLC on one hand, and The American College of Traditional Chinese Medicine on the other hand. Exhibit 2: ACTCM Lease Addendum executed July 12 and 15, 2012 between Jolish 1731 15" Street LLC, Z Glass 15" Street Mission LLC on one hand, and The American College of Traditional Chinese Medicine on the other hand. Exhibit 3: Lease Addendum “Addendum 2” effective July 1, 2013 between Susan Mitchell on one hand and California Institute of Integral Studies on the other hand. Exhibit 4: July 2, 2018 letter to Laura Cambpell from Andrew Zacks. Exhibit 5: San Francisco Letter of Determination RE: 1731 15" Street, Block: 3555 Lot: 056, dated July 19, 2010. Exhibit 6: San Francisco Planning Code §102 definition of “Group Housing” (as amended from §798.88(b) per File No. 170204, Ordinance No. 130.17 “Planning Code — Deletion of Duplicate Definitions and Outdated Article 7 Zoning Control Tables, July 20, 2017). Exhibit 7: San Francisco Planning Code §102 definition of “Post-Secondary Educational Institution”. Exhibit 8: San Francisco Planning Code §304.5 Institutional Master Plans. Exhibit 9: San Francisco Planning Code §317 Loss of Residential and Unauthorized Units 2 UNIFIED EXHIBITS IN SUPPORT OF MOTION FOR SUMMARY ADJUDICATIONZACKS, FREEDMAN & PATTERSON, PC 235 MONTGOMERY STREET, SUITE 400 SAN FRANCISCO, CALIFORNIA 94104 oO MeN DN BF WN N Exhibit 10: Exhibit 11: Exhibit 12: Exhibit 13: Exhibit 14: Exhibit 15: Exhibit 16: Exhibit 17: Exhibit 18: Exhibit 19: Exhibit 20: Exhibit 21: Exhibit 22: Exhibit 23: Exhibit 24: Exhibit 25: Exhibit 26: Exhibit 27: Exhibit 28: Through Demolition, Merger and Conversion. ACTCM’s Request for Production of Documents, Set One, served on Mitchell, dated 12/18/2019. ACTCM’s Special Interrogatories, Set One, served on Mitchell, dated 12/18/2019. ACTCM’s Requests for Admissions, Set One, served on Mitchell, dated 12/18/2019. ACTCM’s Form Interrogatories, Set One, served on Mitchell, dated 12/18/2019. ACTCM’s Proof of Service for discovery served on Mitchell, 12/18/2019. Mitchell’s Responses to Request for Production of Documents, Exhibit 10. Mitchell’s Responses to Special Interrogatories, Exhibit 11. Mitchell’s Responses to Requests for Admissions, Exhibit 12. Mitchell’s Responses to Form Interrogatories, Exhibit 13. Mitchell’s Document Production Bates stamped SM1731000001 through SM1731000135 (not attached in their entirety). Letter from Mark Chernev to Laura Campbell, dated March 3, 2020. Mitchell’s Amended Responses to Request for Production, dated March 20, 2020. Mitchell’s Amended Responses to Special Interrogatories, dated March 20, 2020. Mitchell’s Amended Responses to Request for Admission, dated March 20, 2020. Mitchell’s Amended Responses to Form Interrogatories, dated March 20, 2020. Email from Shane Kolding to Mark Chernev, dated March 20, 2020. Mitchell’s Second Document Production, Bates stamped SM1731000136 through SM1731000288. Email from Shane Kolding to Mark Chernev, dated March 24, 2020. Mitchell’s Document Production Bates stamped SM1731000156 and 3. UNIFIED EXHIBITS IN SUPPORT OF MOTION FOR SUMMARY ADJUDICATIONZACKS, FREEDMAN & PATTERSON, PC 235 MONTGOMERY STREET, SUITE 400 SAN FRANCISCO, CALIFORNIA 94104 oD wm NDA BR WN m nN Exhibit 29: Exhibit 30: Exhibit 31: Exhibit 32: Exhibit 33: Exhibit 34: Exhibit 35: Exhibit 36: Exhibit 37: Exhibit 38: Exhibit 39: Exhibit 40: Exhibit 41: Exhibit 42: SM1731000156. Invoice for $66,935.43 from Mitchell to ACTCM and Balance Sheet. Invoice for $15,899.75 from Mitchell to ACTCM and Balance Sheet. Invoice for $20,190.99 from Mitchell to ACTCM and Balance Sheet. Emails as Mitchell’s Document Production Bates stamped SM1731000138, SM1731000152, SM1731000156, and SM1731000158. Emails as Mitchell’s Document Production Bates stamped SM1731000157, SM1731000158, and SM1731000159. Five Checks dated July 16, 2018 and one check dated April 10, 2018, check numbers 2600164021, 2600164022, 2600164023, 2600164024, 2600164025, and 77460 respectively, made out to Susan Mitchell from the City and County of San Francisco, Letter from Andrew Zacks to Laura Campbell, dated July 2, 2018. Email thread and questionnaire from Barak Jolish to Michael Sano, dated February 27, 2014. Email from Florent Bernard to Dustin DeVan, Nelson Ma, 1731 15", Michael Sano, and Cindy Ochoa, dated July 2, 2014. Letter from Laura Campbell to Lixin Huang, dated June 6, 2018. San Francisco Residential Rent Stabilization and Arbitration Board Petition and Decision in Case No. T172228, In Re: 1731 15" Street, #2J, Jong Seto, Tenant Petitioner, and California Institute of Integral Studies, Landlord Respondent, dated March 8, 2018. Letter from Andrew Zacks to Laura Campbell, dated June 18, 2018. Complaint for Damages, Susan Mitchell, Plaintiff v. The American College of Traditional Chinese Medicine at California Institute of Integral Studies, Defendant, CGC-19-579141, Superior Court of the State of California, City and County of San Francisco, dated September 10, 2019. Cross-Complaint for Damages, Cross-Complainant The American College of “qe UNIFIED EXHIBITS IN SUPPORT OF MOTION FOR SUMMARY ADJUDICATIONZACKS, FREEDMAN & PATTERSON, PC 235 MONTGOMERY STREET, SUITE 400 SAN FRANCISCO, CALIFORNIA 94104 Como nN Dn BF wWwNY | RN NY NY NN KN HN Be eee ee eB ee CTIA AB wBNH HEH DO wO NIDA BF WH KF OO Traditional Chinese Medicine at California Institute of Integral Studies v. Susan Mitchell, Cross-Defendant, CGC-19-579141, Superior Court of the State of California, City and County of San Francisco, dated October 18, 2019. Date: May 1, 2020 _ a oo Mark B, Chernev ZACKS, FREEDMAN & PATTERSON, PC Attorneys for Defendant and Cross-Complainant, The American College of Traditional Chinese Medicine at California Institute of Integral Studies 5. UNIFIED EXHIBITS IN SUPPORT OF MOTION FOR SUMMARY ADJUDICATIONEXHIBIT 1LEASE By and Between JOLISH 1731 15" STREET LLC, and Z GLASS 15"" STREET MISSION LLC (collectively, “LANDLORD’) and THE AMERICAN COLLEGE OF TRADITIONAL CHINESE MEDICINE, (‘TENANT’)Lease Date: Landlord: Landlord’s Address: Send Rent Payments to: Tenant: BASIC LEASE INFORMATION June __, 2012 Jolish 1732 15 Street LLC and Z Glass 15"° Street Mission LLC c/o Barak Jolish PO Box 31814 San Francisco, CA 94131 Phone: 415 640 4468 Email: bjolish@yahoo.com Barak Jolish PO Box 31814 San Francisco, CA 94131 The American College of Traditional Chinese Medicine Premises: 455 Arkansas Street San Francisco, CA 94107 Contact: Lixin Huang, President Phone: 415-282-7600 Email: LixinHuang@actcm.edu 1731 15" Street, San Francisco, CA, consisting of 1 single occupant dorm rooms on the first and second floors (see Exhibit A) Pro-rata Share of Real Estate Taxes: The percentage of the total 49 rooms that the Landlord Work Tenant leases. Initially, this will be 28.6% (14 of 49) The work that Landlord is obligated to perform in the Premises pursuant to a separate agreement (the “Work Letter”) attached to this Lease as Exhibit C.Section 2, Term Term: Term Commencement Date: Lease Expiration Date: Right of Early Termination: Section 3, Rent Base Rent: Annual Rent Adjustment: Rent Structure: Section 4, Use: Section 5, Utilities & Maintenance: Section 6, Real Estate Five Years. Upon Substantial Completion of the Landlord Work, estimated to be July 1, 2013 Five (5) years after the Term Commencement Date Tenant shall have the right to terminate the Lease ona date prior to the Lease Termination Date, under the conditions specified in Section 2.2 of the Lease. $11,900 a month, for the first year of the Term, and $12,390 a month for the second year of the Term; provided, however, for the initial six (6) fall months of the Term (‘Start-Up Period”), Base Rent shall be calculated based on the number of rooms occupied by Tenant multiplied by $850 per month per occupied room. Base Rent to increase 3-0% annually commencing at the beginning of the third year of the Term. Modified Net, as described below. Tenant shall use the space to provide single-occupancy dormitory housing for students, faculty and staff, and for no other purpose. Landlord shall furnish reasonable quantities of electricity, gas, water and sewer, garbage services and other services to the Premises, as specified in Section 5-1. Tenant’s Real Estate Tax obligations specified in Section 6.1, $11,900 vuDefinitions: “Alterations” “Base Rent” “Building” “Common Area” “Development Rights” ‘Environmental Law” “Event of Default” “Hazardous Materials” “Holdover Rent” “Late Fee” “Laws” “Lease Expiration Date” “Modified Net Lease” “Mortgagees” “Permitted Materials” “Premises” “Premises Costs” “Premises Rentable Area” “Property” ‘Real Estate Taxes” “Rent” “Rent Adjustment Date” “Returned Check Charge” “Security Deposit” “Surrender Date” “Tenant's Property” “Term” “Term Commencement Date” The following terms are defined in the Sections referenced below: Section 7 Section 3.1 Section 1.4 Section 1.2 Section 4.4 Section 15.1 Section 12.1 Section 15.1 Section 2.4 Section 3.4 Section 4.3 Section 2.1 Section 3.3 Section 13 Section 15.1 Section 1.1 Section 3.3 Section 1.1 Section 11 Section 6 Section 3.3 Section 3.1 Section 3.5 Section 16 Section 2.3 Section 2.3 Section 2.1 Section 2.1 The Basic Lease Information is incorporated into this Lease. In the event of a conflict between any Basic Lease Information and the Lease, the Lease shall control.LEASE This Lease (“Lease”) is entered into as of the Lease Date specified in the Basic Lease Information by and between JOLISH 1731 15"" STREET LLC, AND Z GLASS 15"" STREET MISSION LLC (collectively, “Landlord”) and The American College of Traditional Chinese Medicine (“Tenant”). Section1. PREMISES Li Premises. Subject to the following terms, covenants and conditions, Landlord leases to Tenant and Tenant leases from Landlord those certain premises (the “Premises”) consisting of 14 dormitory rooms on the first and second floors of the building located at 1731 is? Street, San Francisco, California (the “Building”). The Building, the land and the common area appurtenant to the Building, are sometimes collectively called the “Property”. Landlord reserves the right to alter the Property so long as such alterations do not unreasonably impair access to the Premises. Tenant acknowledges that Landlord has made no representation or warranty regarding the condition of the Premises or the Building or its fitness for the conduct of Tenant’s business, except as specifically set forth in this Lease. 1.2. Common Area. Tenant shall have the non-exclusive use of the common areas (“Common Area”) of the Building. Landlord shall maintain the Common Area, including the fixtures, furnishings and equipment (“FF&E”) installed by Landlord in a good and serviceable condition. Any damage to the Common Area and FF&E caused by Tenant in excess of ordinary wear and tear shall be repaired or replaced by Landlord at Tenant’s expense. Landlord shall have right to remove from the Common Area any items, including furniture, which is not authorized in advance to be located in the Common Area. 1.3 Expansion Right of First Offer. Tenant shall have the right of first offer (the "Right of First Offer") during the Term (as the same may be extended) to lease twenty (20) additional dormitory rooms as a single block located on the third floor of the Building (the "Offering Space"). Tenant's Right of First Offer shall be exercised as follows: at any time after Landlord has determined that the Offering Space is vacant and available to be leased (but prior to leasing such Offering Space to a party other than an existing tenant), Landlord shall advise Tenant (the "Advice") of the of the availability of the Offering Space. Tenant may lease such Offering Space in its entirety only, under the terms of this Lease {including the then applicable Base Rent and Lease Expiration Date), by delivering written notice of exercise to Landlord (the “Notice of Exercise") within 10 days after the date of the Advice, except that Tenant shall have no such Right of First Offer and Landlord need not provide Tenant with an Advice, if: (a) Tenant is in default under the Lease beyond any applicable notice and cure period; (b) Tenant has assigned the Lease (other than to a Permitted Transferee), sublet the Premises (other than to a Permitted Transferee) or is otherwise not occupying the Premises; or (c) Tenant does not intend to use the Offering Space for the use permitted by the Lease. If Tenant is entitled to and properly exercises theRight of First Offer, Landlord shall prepare an amendment (the "Expansion Amendment") to reflect the commencement date of the term for the Offering Space and the changes in Base Rent, Tenant's Pro Rata Share of Real Estate Taxes and other appropriate terms which shall be coterminous with the remaining Term of the Premises, and shall be at the same Base Rent and terms as for the Premises as of the time of exercise. Possession of the Offering Space shall be delivered to Tenant in a condition comparable to the condition of the Premises as of the Term Commencement Date. A copy of the Expansion Amendment shall be sent to Tenant within a reasonable time after Landlord’s receipt of the Notice of Exercise, and Tenant shall execute and return the Expansion Amendment to Landlord within fifteen (a5) days thereafter, and Landlord shall return an executed copy to Tenant fifteen (5) days thereafter, but an otherwise valid exercise of the Expansion Option shall be fully effective whether or not the Expansion Amendment is executed. Section2, TERM 2.1 Term. The term of the Lease (‘Term’) is five (5) years, commencing on the “Term Commencement Date” and ending on the “Lease Expiration Date” as specified in the Basic Lease Information. The Term Commencement Date shall be the date on which the Landlord Work is “Substantially Complete”, but no earlier than July 1, 2013 unless agreed to in writing by Landlord and Tenant. The Landlord Work shall be deemed to be “Substantially Complete” on the later of (i) the date that the Landlord Work has been performed, other than any details of construction, mechanical adjustment or any other similar matter, the non-completion of which does not materially interfere with Tenant’s use of the Premises; and (ii) the date Landlord receives from the appropriate governmental authorities, with respect to the Landlord Work, all approvals necessary for the occupancy of the Premises. If Landlord is delayed in the performance of the Landlord Work as a result of the negligent acts or omissions of Tenant or its contractors or vendors, including, without limitation, changes requested by Tenant to approved plans, Tenant’s failure to comply with any of its obligations under this Lease, or the specification of any materials or equipment with long lead times (a “Tenant Delay”), the Landlord Work shall be deemed to be Substantially Complete on the date that Landlord could teasonably have been expected to Substantially Complete the Landlord Work absent any Tenant Delay. 2.2 Lease Contingency; Option of Termination. This Lease is expressly contingent upon Landlord obtaining all necessary approvals and permits from the City of San Francisco to complete Landlord’s Work in accordance with the Approved Plans. Following the full execution of this Lease, Landlord shall use commercially reasonable and diligent efforts to obtain the foregoing approvals and permits. In the event Landlord is unable to obtain such approvals and permits on or before June 15, 2013, then Tenant shall have the option to terminate this Lease by delivering written notice to Landlord on or before Landlord’s notice to Tenant that Landlord has obtained the approvals and permits. Additionally, provided that Tenant is not in Default, Tenant shall have the option toterminate the Lease by written notice to Landlord in the event the Landlord has not delivered the Premises to Tenant with Landlord’s Work Substantially Complete on or before July 1, 2013 (“Outside Completion Date”). Tenant’s exercise of the termination notice pursuant to the preceding sentence shall only be effective if delivered to Landlord no later than thirty (30) days following the Outside Completion Date. If Tenant timely exercises either of the foregoing termination options, then the Lease shall terminate effective as of the delivery of such notice and the rights and obligations of the parties to the Lease shall cease, except for those rights and obligations which expressly survive termination of this Lease. 2.3 Surrender. At the end of the Term, or at the end of any subsequent holdover period permitted by Landlord or upon any earlier termination of this Lease (the date of surrender being referred to as the “Surrender Date”), Tenant shall peaceably surrender the Premises “broom” clean and in good order, repair and condition, ordinary wear and tear and casualty damage excepted. The Alterations (as defined in Section 7) shall remain the property of Tenant during the Term. Unless otherwise agreed at the time Landlord’s approval is requested for Tenant's Alterations, all such Alterations shall become the property of Landlord at the end of the Term or earlier expiration of this Lease and be deemed a part of the Premises. On or before the Surrender Date, Tenant shall remove from the Premises all trade fixtures, furnishings, equipment, and other personal property installed by Tenant (collectively, “Tenant’s Property’), and shall repair any damage to the Premises resulting from such removal. If Tenant fails to remove any of Tenant's Property, or restore the Premises to the condition specified herein on the Surrender Date, Landlord shall have the right, in addition to such other rights and remedies as may be available at law or in equity, to perform all such removal and restoration at Tenant’s sole cost and without notice or any other obligation to Tenant (including without limitation any obligation to mitigate damages or realize salvage value). Any of Tenant’s Property not removed by Tenant on or before the Surrender Date shall be considered abandoned, and Landlord may remove any or all of Tenant’s Property and dispose of it in any lawful manner, or may store any of Tenant's Property in a public warehouse or elsewhere for the account and at the expense and risk of Tenant. 2.4 Holdover. If Tenant holds over after the expiration or earlier termination of the Term with Landlord’s prior written consent, (a) Tenant’s occupancy of the Premises shall be deemed a month-to-month tenancy terminable by either party upon 30 days’ written notice to the other, (b) the monthly Rent during the holdover period shall be 125% of the monthly Rent during the last month of the Term and (c) Tenant’s occupancy of the Premises during the holdover period otherwise shall be subject to all applicable terms and conditions of this Lease. If Tenant holds over after the expiration or earlier termination of the Term without Landlord’s prior written consent, Tenant shall be deemed a tenant at sufferance and Tenant's occupancy of the Premises during the holdover period otherwise shall be subject to all applicable terms and conditions of this Lease, except the monthly Rent during the 7holdover period (“Holdover Rent”) shall be 125% of the monthly Rent during the last month of the Term. 25 Renewal Option. Provided that (a) this Lease is in full force and effect, (b) Tenant is not then in default in the performance of any of the terms and conditions of this Lease (beyond the expiration of any applicable period for cure), (c) Tenant has not assigned this Lease (other than to a Permitted Transferee), and (d) Tenant (or a Permitted Transferee) is in occupancy for its own use of the entire Premises (collectively, the "Option Conditions"), Tenant shall have two (2) options to extend the term of this Lease fora period of five (5) years each, subject to the following conditions: () each option shall be exercised by written notice of exercise given to Landlord by certified mail, with return receipt, or by hand delivery not earlier than 12 months or later than 9 months prior to the expiration, as applicable, of the original Lease Expiration Date or the initial extension term; and (ii) the Option Conditions shall be satisfied both at the time the option is exercised and at the commencement of the extension term. In the event the option is timely exercised, the Term of this Lease shall be extended for a period of five (5) years upon all of the terms and conditions of this Lease and the Base Rent during such extended term shall be ninety percent (90%) of the Fair Market Rental Rate. rentals then being charged for comparable dormitory properties in San Francisco, taking into account the length of the extension term, the rental structure, the fixed increases in Base Rent during the extension term provided for herein, the manner of pass-through of additional rent, free or reduced rent periods, any improvements or improvement allowance made to the Premises, and any brokerage commissions directly related to dormitory room leasing transactions. Within thirty (30) days following Tenant's exercise of the option to extend, Landlord shall deliver written notice to Tenant specifying Landlord’s determination of the Fair Market Rental Rate for the Premises as of the commencement of the extension term (“Landlord's Determination”). Within fifteen (15) days following Tenant’s receipt of such Landlord’s notice specifying Landlord’s Determination, Tenant shall deliver written notice to Landlord either agreeing with Landlord’s Determination or disagreeing therewith and specifying Tenant's determination of the Fair Market Rental Rate of the Premises as of the commencement of the extension term (“Tenant’s Determination”). In the event Tenant fails to timely deliver such notice, then Landlord’s Determination shall be binding on Tenant. In the event Tenant so disagrees with Landlord’s Determination, then Landlord and Tenant shall promptly meet and endeavor in good faith to reach agreement upon the Fair Market Rental Rate for the extension term. Upon agreement, Landlord and Tenant shall enter into a renewal amendment. Notwithstanding the foregoing, if Landlord and Tenant fail to agree upon the Fair Market Rental Rate within thirty (30) days after the date Tenant provides Landlord with Tenant’s Determination, Tenant, by written notice to Landlord (the “Arbitration Notice") within five (5) days after the expiration of such thirty (30) day period, shall have the right to have the Fair Market Rental Rate determined in accordance with the arbitration procedures described below.If Tenant provides Landlord with an Arbitration Notice, Landlord and Tenant, within five (5) days after the date of the Arbitration Notice, shall each simultaneously submit to the other, in a sealed envelope, its good faith estimate of the Fair Market Rental Rate for the Premises (collectively referred to as the "Estimates"). If the higher of such Estimates is not more than 105% of the lower of such Estimates, then Fair Market Rental Rate shall be the average of the two Estimates. If the Fair Market Rental Rate is not resolved by the exchange of Estimates, then, within seven (7) days after the exchange of Estimates, Landlord and Tenant shall each select an appraiser to determine which of the two Estimates most closely reflects the Fair Market Rental Rate for the Premises. Each appraiser so selected shall be certified as an MAI appraiser or as an ASA appraiser and shall have had at least five (5) years experience within the previous ten (10) years as a real estate appraiser working in the San Francisco area, with working knowledge of current rental rates and practices for similar space. For purposes hereof, an "MAI" appraiser means an individual who holds an MAI designation conferred by, and is an independent member of, the American Institute of Real Estate Appraisers (or its successor organization, or in the event there is no successor organization, the organization and designation most similar), and an "ASA" appraiser means an individual who holds the Senior Member designation conferred by, and is an independent member of, the American Society of Appraisers (or its successor organization, or, in the event there is no successor organization, the organization and designation most similar). Upon selection, Landlord's and Tenant's appraisers shall work together in good faith to agree upon which of the two (2) Estimates most closely reflects the Fair Market Rental Rate for the Premises. The Estimate chosen by such appraisers shall be binding on both Landlord and Tenant as the Minimum Rent rate for the Premises during the extended Lease Term. If either Landlord or Tenant fails to appoint an appraiser within the seven (7) day period referred to above, the appraiser appointed by the other party shall be the sole appraiser for the purposes hereof. If the two appraisers cannot agree upon which of the two (2) Estimates most closely reflects the Fair Market Rental Rate within twenty (20) days after their appointment, then, within ten (10) days after the expiration of such twenty (20) day period, the two appraisers shall select a third appraiser meeting the aforementioned criteria. Once the third appraiser (i.e. arbitrator) has been selected as provided for above, then, as soon thereafter as practicable but in any case within fourteen (14) days, the arbitrator shall make his determination of which of the two Estimates most closely reflects the Fair Market Rental Rate and such Estimate shall be binding on both Landlord and Tenant. If the arbitrator believes that expert advice would materially assist him, he may retain one or more qualified persons to provide such expert advice. The parties shall share equally in the costs of the arbitrator and of any experts retained by the arbitrator. Any fees of any appraiser, counsel or experts engaged directly by Landlord or Tenant, however, shall be borne by the party retaining such appraiser, counsel or expert. If the Fair Market Rental Rate has not been determined by the commencement date of the extended Lease Term, Tenant shall pay Base Rent upon the terms and conditions in effect during the last month of the original Term or first extension term, as applicable, for 9the Premises until such time as the Fair Market Rental Rate has been determined. Upon such determination, the Base Rent for the Premises shal] be retroactively adjusted to the commencement of the extended Lease Term. Section 3. RENT 31 Base Rent. Tenant shall pay the monthly Base Rent (“Base Rent”) specified in the Basic Lease Information. The Base Rent shall be due on the first day of each and every month during the Term, without notice, set off, or invoice from Landlord. The Base Rent for any partial month shall be pro-rated at the rate of 1/30 of the monthly Base Rent per day. During the Start-Up Period, Base Rent shall be determined based on actual occupancy of the dormitory rooms comprising the Premises, pro-rated as provided above. Tenant shall certify in writing to Landlord at the beginning of each month during the Start-Up Period the number of rooms occupied and the date occupancy commenced for each room and Base Rent shall be determined in accordance with such certification. 3-2 Rent Adjustment. Base Rent shall increase annually by three percent (3.0%) during the final three years of the Term 3:3 Modified Net Lease; Rent Defined. This Lease is a “Modified Net Lease” pursuant to which Tenant shall pay (in addition to Base Rent) for its Pro-Rata Share of Real Estate Taxes. Tenant will petition the City of San Francisco for exemptions from real estate taxes based on its non-profit status. For purposes of this Lease, “Rent” shall mean and include all amounts and charges Tenant is obligated to pay under this Lease, including Base Rent, Tenant's Pro-rata Share of Real Estate Taxes, Late Fees (Section 3.4), Returned Check Charge (Section 3.5) and interest (as provided in this Lease). Unless as otherwise provided herein, Tenant shall pay the Rent to Landlord at the times set forth in this Lease, without deduction, setoff, prior notice or demand, in lawful money of the United States of America, at the address specified in the Basic Lease Information, or to such other person and/or at such other address as Landlord may designate in writing from time to time. 3-4 Late Payment. Tenant recognizes that late payment of any Rent or other sum due hereunder from Tenant to Landlord shall incur costs and expenses not originally contemplated under this Lease; including but not limited to certain administrative expenses, collection costs, processing, and accounting expenses, the extent of which additional expense is extremely difficult and economically impractical to ascertain. Tenant therefore agree that if Rent or any other payment due hereunder from Tenant to Landlord remains unpaid ten (10) days after said amount is due, the amount of such unpaid Rent or other payment shall be increased by a “Late Fee” to be immediately paid to Landlord by Tenant in an amount equal to Five Percent (5%) of said Rent or other sum that remained unpaid for the above mentioned ten (10) day period. Both parties agree that such amount is a reasonable estimate of the loss and expense to be suffered by Landlord as a result of such late payment by Tenant and may be charged by Landlord to defray such loss and expense. 10The provisions of this Section 3.4 in no way relieve Tenant of the obligation to pay Rent or other payments on or before the day on which they are due, nor do the terms of this Section 3.4 in any way affect Landlord’s remedies pursuant to this Lease in the event said Rent or other payment is unpaid after the date due. 3.5 Returned Check Charge. In the event Tenant’s payment of Rent to Landlord in the form of a check is returned for insufficient funds, Tenant shall pay to Landlord a returned check charge (“Returned Check Charge”) of $25.00, which shall be submitted by Tenant along with the Rent due within five (5} days of written notice by Landlord. Such Returned Check Charge shall be in addition to any late payment charges incurred and shall be deemed additional Rent. After two such Returned Check Charges, Tenant shall submit all subsequent Rent payments to Landlord in the form of a cashier's check or money order only. Section 4. USE OF PREMISES; COMPLIANCE WITH LAWS; SIGNAGE 41 Permitted Use. The Premises shall be used only for the use specified in the Basic Lease Information and related uses. Tenant agrees at all times to use its best efforts to conduct and carry on Tenant’s business in such a manner that no loud noises, including amplified sound, or odors shall emanate from the Premises. In the event that the operation of Tenant’s business causes noise or disturbances to other tenants in the Building, Tenant agrees to take prompt and reasonable steps to reduce the level of noise emanating from the Premises. Tenant agrees to otherwise abide by the rules and regulations set forth in Exhibit “B” of this Lease to ensure the peaceful enjoyment of the Property by all tenants of the Building. 4.2 Prohibited Uses. Tenant shall not use or allow the Premises to be used for any improper, immoral or unlawful purpose, nor shall Tenant cause, maintain or permit any nuisance or waste in, on or about the Premises. Tenant shall not allow the Premises to be occupied by vagrants or visitors who are not students, faculty or staff who are not using the services of Tenant’s business. The Premises shall not be used for any purpose not specified in the Basic Lease Information without Landlord’s prior written consent. Tenant agrees not to conduct or permit to be conducted any fire sale or any sale by auction on the Premises. Premises rooms are for single occupancy only, unless otherwise agreed to in writing by Landlord. No guest of a dormitory room occupant may stay on the Premises for more than three (3) consecutive nights. 4.3 Compliance with Laws. Tenant shall comply with, and shall not use or occupy the Premises or allow the Premises to be used or occupied in violation of, (a) any law, zoning restriction, ordinance, rule, regulation, requirement, order or decree of any governmental or quasi-governmental agency with jurisdiction over Tenant or the Premises (collectively, “Laws”), (b) the requirements of the Fire Marshal, the Board of Fire Underwriters or any insurer or insurance authority, (c) any certificate(s) of occupancy issued for the Premises or the Building, (d) any use permit issued for Tenant’s use of the Premises, or (e) any recorded covenants, conditions and restrictions, or private contracts of which nLTenant has actual knowledge and which affect the use and operation of the Premises. Tenant shall procure, maintain and make available for Landlord’s inspection, at Tenant’s sole cost, all governmental licenses and permits required for the proper and lawful conduct of Tenant's operations and activities within the Premises and the Building. Tenant shall observe and adhere to all occupancy restrictions established for the Premises. 44 Development Rights. Landlord expressly reserves from this Lease any and all rights related to the development of the Property (collectively, “Development Rights’). Tenant acknowledge that they have no right, title or interest in or to any Development Rights, and shall have none at any time in the future. Tenant shall not take or cause any action to be taken which could interfere with Landlord's exercise of its Development Rights (which Landlord shall have no obligation to exercise for the benefit of Tenant), or which could impair or otherwise affect any Development Rights. 4.5 Signage. Tenant shall not erect or install in, upon or about the Premises or Building any exterior or interior signs or advertising media or window or door lettering or placards without Landlord’s prior written consent which consent shall not be unreasonably withheld, conditioned or delayed. Any signage approved by Landlord shall be subject to approval by the applicable governing authorities. Tenant shall properly and promptly maintain and repair its signs, and keep them ina neat and clean condition. Upon expiration or sooner termination of this Lease, Tenant shall promptly remove all signs installed hereunder and repair, patch and paint the exterior surface damaged by such removal. Tenant shall not use any advertising media or other media that is objectionable to Landlord, or which can be heard outside the Premises, such as loudspeakers, phonographs or radio broadcasts. Section 5. UTILITIES; MAINTENANCE AND REPAIRS 5.1 Utilities and Other Services. Both parties understand the Premises are not separately metered for utilities, including electricity, water and sewer service. Tenant shall pay its proportionate share of the Building’s services, as specified below. Except as expressly provided otherwise herein, Tenant shall procure, at its sole cost, and timely pay for all other services which Tenant may deem necessary in connection with Tenant's use, occupancy and enjoyment of the Premises or performance of its obligations under this Lease, including without limitation telephone, cable, Premises cleaning, and security as described below. (a) Electric and Gas Service: Landlord shall pay for electric and gas service furnished to the Building by Pacific Gas & Electric (“ 'G&E”). Landlord reserves the right to impose reasonable energy conservation measures. Landlord also reserves the right to charge back to Tenant and/or offset “Unreasonable Energy Expenses” from the Security Deposit. “Unreasonable Energy Expenses” are expenses in excess of those required for lighting, heating, and incidental electronics. Examples of Unreasonable Energy Expenses are those caused by lights for indoor plant cultivation, operation of more than two computers per individual, and excessive heating.(b) Water and Sewer Service: Landlord shall pay for the Building's water and sewer service, as charged by San Francisco Public Utilities Commission. Landlord reserves the right to impose reasonable water conservation measures. (c) Trash Removal Service: Tenant is permitted use of the Building’s trash and recycling bins, located in an area to be specified by Landlord (“Trash Area”). Landlord shall pay for trash removal service, with no contribution from Tenant. Landlord reserves the right to impose reasonable trash mitigation and recycling measures. Landlord also reserves the right to charge back to Tenant and/or offset “Unreasonable Trash Removal Expenses” from the Security Deposit. “Unreasonable Trash Removal Expenses” are expenses incurred for trash generation in excess of those required for single-occupancy student rooms. Examples of Unreasonable Trash Removal Expenses are trash generated from resident business uses, art projects, or from furniture boxes. (d) Cleaning Services: Landlord shall provide janitorial services to the Common Areas on a regular schedule (schedule to be further defined by Landlord). Dormitory rooms shall be cleaned by the occupants at their sole cost or arranged by Tenant at its sole cost, and Tenant shall clean dormitory rooms between move-in and move-out and in the event the occupants of the dormitory fail to maintain their rooms in a reasonably good condition. In the event of extraordinary occupant neglect, Landlord may clean dormitory rooms, and charge back to Tenant the cost of such cleaning and/or offset the cleaning fee against the Security Deposit. (e) Wireless/Telephone: Landlord, at its cost, shall provide a minimum of one (1) Ti bandwidth internet connection (or equivalent) for the Building. Landlord will allow Tenant dormitory room occupants to access this connection via secure wireless access points. Tenant shall assist Landlord in obtaining favorable connectivity rates through Tenant's service provider. Occupants of dormitory rooms shall be responsible for their own telephone and data service providers. This connection is for limited {Internet usage only. The downloading of large files (e.g., movies, large amounts of music) is prohibited. (f) Security: The entrance to the Building shall be securely locked at all times. Landlord shall furnish all occupants of the Building with card key access (or equivalent). Notwithstanding the above, Landlord may charge a key deposit for a resident who loses his or her initial key. Landlord shall not be responsible for providing any other means of security for the Building, but Tenant shall be permitted to do so at its own expense with written approval from Landlord. This approval shall not be unreasonably withheld so long as such security does not interfere with the use of or access to the Building by other tenant or occupants. (g) On-Site Manager; Resident Advisors: Landlord shall provide an on-site property manager at no additional expense to Tenant. Tenant shall designate an occupant of a dormitory room of the Building leased by Tenant as a resident contact. 13(h) On-Site Laundry: Landlord shall provide and maintain for the use of the occupants of the dormitory rooms a minimum of four (4) coin operated washer and dryer units. 5.2 Landlord’s Repair and Maintenance Obligations. Landlord shall repair and maintain in good working order and condition, at Landlord’s sole cost and expense without reimbursement from Tenant, the Common Areas (as provided in Section 1.2), the Building foundation and structural elements of the Premises and the Building, floor slab of the Premises and the Building, exterior walls, window casements and moldings, roof of the Building, elevator, security and fire/life safety systems serving the Building in general, and the HVAC, electrical, phimbing and sewer systems that serve the Building in general; provided that, Tenant shall bear the cost of (a) repairing any portion of the Common Areas or Premises damaged by the action of Tenant, its employees, agents, contractors, subtenant(s), assignees, guests or invitees, except for ordinary wear and tear and also except to the extent covered by insurance, and (b) any structural or other work caused by or arising from penetration of the Building (including its floor slab) by or on behalf of Tenant. 5.3 Tenant’s Repair and Maintenance Obligations. It shall be Tenant’s responsibility at all times during the Term to ensure that the dormitory rooms and any FF&E located therein are maintained in a good, neat and clean condition, free from excessive trash. 5.4 Tenant Failure to Repair. If Tenant fails, for any reason, to repair and maintain the Premises as required by this Lease to Landlord’s reasonable satisfaction within ten (10) days after Landlord presents a written notice and demand for such repairs, Landlord shall have the right, but not the obligation, to enter the Premises and perform such repairs or maintenance without liability to Tenant for any loss or damage to Tenant’s Property or interference with Tenant's occupancy arising there from. If Landlord performs such repairs or maintenance, Tenant shall pay Landlord all reasonable costs thereof, plus 5% of such costs for supervision, administration and overhead, within ten (10) days after receipt of Landlord’s written invoice. 5-5 No Self-Help. Tenant waives and shall have no right to make repairs at Landlord’s expense under any law, statute or ordinance now or subsequently in effect, including without limitation the provisions of California Civil Code section 1942 and any similar or successor statutes. Section 6. REAL ESTATE TAXES, 61 Definitions. “Real Estate Taxes” shall mean all taxes, assessments, levies and other charges, which are assessed or charged by a governmental or quasi-governmental entity or agency upon the Property during the Term. Real Estate Taxes include (a) all taxes on the assessed value of the Property (“Property Taxes”) and (b) all fees, assessments, 14excises or charges for transit, police, fire, housing, schools, other governmental services, or purported benefits to the Building and service payments in lieu of taxes (“Assessments”). The parties acknowledge that the Premises occupied by the Tenant may become exempt from Property Taxes, in the event that Tenant applies for and receives its non-profit tax exemption from the federal and state governments for the Premises on an annual basis. Commencing as of the Term Commencement Date, Tenant is responsible for paying Tenant's Pro-rata Share of any Real Estate Taxes due in the event Tenant fails to qualify or apply for such tax exemption, to be billed back to the Tenant as explained below. 6.1 Tax Payments. Tenant shall Pay its tax payment (“Tax Payment”) based on the Tenant’s Pro-rata Share of Real Estate Taxes within twenty (20) days after receiving a bill for the Tax Payment from the Landlord. Landlord shall bill Tenant on a semi-annual basis based on the schedule for tax payments for the City and County of San Francisco. Upon request by the Tenant, Landlord shall provide Tenant with a copy of the previous year’s tax bill for the Property to assist Tenant with preparing for the following year's estimated Tax Payment. Any Real Estate Taxes for the lease years in which the Term Commencement Date commences and the Lease terminates shall be pro-rated between Landlord and Tenant to the end that Tenant shall only pay such portion of the Real Estate Taxes as is included within the Term of this Lease. Section 7, ALTERATIONS AND IMPROVEMENTS. Tenant shall make no alterations, additions, or improvements to the Premises (collectively ‘Alterations”) without Landlord’s prior written consent. Tenant’s request for Landlord’s approval of Alterations shall be accompanied by a written description of the proposed Alterations, a set of plans and permit applications, the name, license number and insurance certificate of the contractor(s), and such other information as Landlord reasonably may request. Alterations shall be made or installed, at Tenant’s sole cost, only after Landlord has approved the plans, specifications, and contractor in writing. At least three days before Tenant commences construction of the Alterations, Tenant shall provide Landlord with copies of all permit application approvals. All Alterations shall be constructed in accordance with approved plans, and ina first- class and workmanlike manner. The Property shall be kept clean and clear of debris during construction. All contractors shall be licensed and shall have appropriate workers’ 5compensation, general liability, and other required insurance. Each contractor shall be required to indemnify Landlord against claims arising out of such contractor's acts and omissions, and to name Landlord as additional insured under its general liability insurance policy. Tenant shall not permit any mechanic's or other liens or encumbrances (collectively, “Liens”) to be filed against all or any part of the Building. If any Lien is filed, Tenant shall immediately cause the Lien to be discharged, released or bonded over, at no cost to Landlord, so that the Lien has no further affect on the Building. Within three days after completion of the Alterations, Tenant shall provide Landlord with copies of all approved job cards and approvals from the San Francisco Building Department. Section 8. QUIET ENJOYMENT 8.1 Landlord’s Covenant. Upon pa ying the Rent and performing all of its other obligations under this Lease, Tenant shall peaceably and quietly have, hold and enjoy the Premises in accordance with all the terms and conditions of this Lease against all persons claiming an interest through Landlord. 8.2 Right of Entry. Upon prior written notice to Tenant of no less than 24 hours (which may be provided by electronic mail), except in the event of a required emergency repair, Landlord and Landlord’s agents, employees and contractors shall have the right to enter the Premises at all reasonable times during normal business hours in order to inspect the Premises, make repairs or improvements to the Premises or the Property as required by this Lease, perform any of Landlord’s obligations as provided in this Lease, exercise any of Landlord’s rights as provided in this Lease or show the Premises to prospective Mortgagees {as defined in Section 13), purchasers or Tenant of the Premises, Landlord shall use reasonable efforts to minimize interference with Tenant’s use of the Premises and provide Tenant with reasonable advance notice of any such entry (except in emergency situations). Landlord shall have the right to use any and all means it deems necessary or appropriate in order to obtain entry to the Premises in case ofan emergency. Any such entry shall not be construed to be a forcible or unlawful entry into the Premises, or an actual or constructive eviction of Tenant from the Premises or any portion thereof. Section 9. INDEMNIFICATION AND EXCULPATION 9.1 Indemnity. To the maximum extent permitted by law, Tenant shall indemnify, defend, protect and hold Landlord and Landlord's, employees, agents, successors and assigns harmless from and against any and all claims, losses, damages, liabilities and costs, including without limitation reasonable attorneys’ fees and costs, arising out of or resulting in whole or in part from (a) any negligent act or omission of Tenant or any of Tenant’s employees, agents, contractors, Subtenant, assignees, licensees, guests or invitees; (b) any failure by Tenant to perform any of its obligations under the Lease; or (c) any property damage, bodily injury, personal