California Lease Clause Samples

California Lease. The parties have requested a Phase I environmental site assessment concerning the property leased by Seller in Stockton, California (the "California Property"). The parties have received a draft of the executive summary, but the entire report has not been delivered because of delays in receiving county records. The executive summary recommends that samples be taken in two locations and the parties have agreed to do so. It is anticipated that the results of the sampling process and county records search will be known on or about November 15. Seller hereby grants Smithway a license to use the California Property to the full extent Seller is able to use the California Property under the leased attached as Exhibit F to the Main Agreement (the "California Lease"). The license granted pursuant to this Section shall commence at Closing and extend until consummation of one of Smithway's options set forth below. With five (5) business days after the later of (a) delivery to Smithway of the final Phase I environmental site assessment and (b) delivery to Smithway of the results of the site sampling mentioned above, Smithway will select and consummate one of the following options: (a) take an assignment of the California Lease and all rights to payments from subtenants from Seller and agree to pay, perform, and discharge all obligations under the California Lease; or (b) decline to accept assignment of the California Lease and cease using the California Property, in which event, the license referred to above shall extend for another thirty (30) days. During the period of the license, Smithway shall reimburse Seller, on a prorated daily basis, for the difference between Seller's rent under the California Lease and the payments received from subtenants. The deferred decision on the California Property shall not affect the Closing of the other transactions under the Main Agreement.

California Lease. On the date hereof, Seller shall assign to Smithway, and Smithway shall accept from Seller, an assignment of the lease attached as Exhibit G to the Main Agreement (the "California Lease") and all rights to payments from subtenants, and Smithway shall agree to pay, perform, and discharge all obligations under the California Lease from and after the date hereof. Rent payable by Smithway under the California Lease shall be prorated from October 26, 1996, to November 1, 1996, resulting in a $967 payment by Smithway to Seller. For the additional soil samplings that were required in the Stockton Phase I Environmental Assessment, Seller and Smithway each shall pay half of the $1,226.50 fee assessed for the soil samplings. Smithway shall pay the entire amount due for the additional soil samplings and $613 will be deducted from the Escrowed Funds, as hereinafter defined, released to Seller.

California Lease. Smithway shall assume from Seller the lease of the property located in Stockton, California ("California Property"). Such lease is attached as Exhibit F. Smithway and Seller shall share equally the cost of a Phase I environmental site assessment of the California Property. Said Phase I Site Assessment shall be completed prior to Closing. If the results of the site assessment indicate that remediation is required or that additional assessment is required, Smithway may at its option (i) elect to sublease the California Property from Seller for the balance of the original lease term under the California lease, (ii) may simply proceed to take an assignment of said lease, or (iii) may elect not to proceed to Closing. In any event, Seller shall hold Smithway harmless from and against any liability arising from the presence of contamination at the California Property during the time that Seller has been in possession thereof. If additional assessments or remediation are needed for events on the California Property arising after Closing, Smithway shall bear the cost of such additional assessments or remediation.