Exhibit 10.7
LEASE
000 XXXXX XXXXXX
INTEREAL CORPORATION, AGENTS
(000) 000-0000
THIS LEASE ("Lease"), dated as of August 1, 1999, for reference purposes
only is made and entered into by and between 000 XXXXX XXXXXX ASSOCIATES, a
California General Partnership herein called Lessor and XXXX.XXX a DELAWARE
corporation herein called Lessee.
THIS LEASE is subject to the terms, covenants and conditions herein set
forth, and the Tenant covenants as a material part of the consideration for this
Lease to keep and perform each and all of said terms, covenants and conditions
by it to be kept and performed and that this Lease is made upon the condition of
said performance.
WITNESSETH:
ARTICLE 1
Premises
Lessor hereby leases to Lessee and Lessee leases from Lessor for the term,
at the rental, and upon all of the conditions set forth herein a portion of that
certain real property situated in the City and County of San Francisco, State of
California, commonly known as the 000 Xxxxx Xxxxxx Building, located at the
Southwest corner of Third and Xxxxxx Streets. Said portion is more particularly
described as: (See Addendum) a suite of approximately (See Addendum), as
diagrammed on Exhibit "B" attached to and made a part of this lease. Said real
property, including the land and the improvements therein or so much as Lessee
is entitled to occupy or use under terms of this Lease, is herein called the
"Premises".
ARTICLE 2
Term
Except as otherwise provided in this Lease, the term of this Lease shall be
One (1) year commencing on August 1, 1999. and expiring on July 31, 2000 unless
sooner terminated pursuant to any provisions hereof.
ARTICLE 3
Possession
Notwithstanding said commencement date, if for any reason Lessor cannot
deliver possession of the Premises to Lessee on said date, Lessor shall not be
subject to any liability therefor, nor shall such failure affect the validity of
this
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Lease or the obligations of Lessee hereunder or extend the term hereof, but
in such case, Lessee shall not be obligated to pay rent until possession of the
Premises is tendered to Lessee; provided, however, that if Lessor shall not have
delivered possession of the Premises within sixty (60) days from said
commencement date, Lessee may, at Lessee's option, by notice in writing to
Lessor within ten (10) days thereafter, cancel this Lease, in which event the
parties shall be discharged from all obligations hereunder; provided further,
however, that if such written notice of Lessee is not received by Lessor within
said ten (10) day period, Lessee's right to cancel this Lease hereunder shall
terminate and be of no further force or effect. If Lessee occupies the Premises
prior to said commencement date, such occupancy shall be subject to all
provisions hereof, such occupancy shall not advance t he termination date, and
Lessee shall pay rent for such period at the initial monthly rates set forth
below.
ARTICLE 4
Base Rent
Lessee shall pay to Lessor as base rent for the Premises the sum of TWENTY
FOUR THOUSAND, FIVE HUNDRED SIXTY ONE Dollars and 50/100 ($24,561.50),
commencing August 1, 1999 in advance on or before the first day of each calendar
month of the term of this Lease without deduction, offset, prior notice or
demand, in lawful money of the United States. Base Rent for any period during
the term hereof which is for less than one month shall be a pro rata portion of
the monthly installment calculated on a 30-day month basis and payable in
advance.
ARTICLE 5
Security Deposit
Lessee has deposited with Lessor the sum of TWENTY FOUR THOUSAND, FIVE
HUNDRED SIXTY ONE Dollars and 50/100 ($24,561.50). Said sum shall be held by
Lessor as security for the faithful performance by Lessee of all the terms,
covenants, and conditions of this Lease to be kept and performed by Lessee
during the term hereof. If Lessee defaults with respect to any provision of
this Lease, including, but not limited to the provisions relating to the payment
of rent, Lessor may (but shall not be required to) use, apply or retain all or
any part of this security deposit for the payment of any rent or any other sum
in default, or for the payment of any amount which Lessor may spend or become
obligated to spend by reason of Lessee's default, or to compensate Lessor for
any other loss or damage which Lessor may suffer by reason of Lessee's default.
If any portion of said deposit is so used or applied, Lessee shall within five
(5) days after written demand therefor, deposit cash with Lessor in an amount
sufficient to restore the security deposit to its original amount and Lessee's
failure to do so shall be a material breach of this Lease. Lessor shall not be
required to keep this security deposit separate from its general funds, and
Lessee shall not be entitled to interest on such deposit. If Lessee shall fully
and faithfully perform every provision of this Lease to be performed by it, the
security deposit or any balance thereof shall be returned to Lessee (or, at
Lessor's option, to the last assignee of Lessee's interest hereunder) at the
expiration
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of the Lease Term. In the event of termination of Lessor's interest in this
Lease, Lessor shall transfer said deposit to Lessor's successor in interest.
ARTICLE 6
Rent Adjustments
Notwithstanding anything contained in this Article, the rental payable
by Lessee shall in no event be less than the base rent specified in Article
four (4) herein above. For the purposes of this Article, the following
terms are defined as follows:
Base Year: The calendar year in which this Lease term
commences, (1998).
Comparison Year: Each calendar year of the term after the Base Year.
(A) Direct Expenses: In addition to Base Rent, Lessee shall pay to
Lessor its Pro Rata share of expenses as herein defined. All direct
costs of operation and maintenance, as determined by standard
accounting practices, shall include the following costs by way of
illustration, but not be limited to: real property taxes and
assessments; rent taxes, gross receipt taxes, (whether assessed
against the Lessor or assessed against the Lessee and collected by the
Lessor, or both), water and sewer charges, insurance premiums,
utilities, janitorial services, labor, costs incurred in the
management of the Building, if any, air conditioning & heating,
elevator maintenance, supplies, material, equipment, and tools,
including maintenance, costs, and upkeep of all parking and common
areas. ("Direct Expenses" shall not include depreciation on the
Building of which the Premises are a part or equipment therein, loan
payments, executive salaries or real estate brokers' commissions, or
costs paid directly by Lessee).
If the Direct Expenses paid or incurred by the Lessor for the
Comparison Year on account of the operation or maintenance of the Building
of which the Premises area part are in excess of the Direct Expenses paid
or incurred for the Base Year, then the Lessee shall pay 9.06% of the
increase. This percentage is that portion of the total rentable area of the
Building occupied by the Lessee hereunder. Lessor shall endeavor to give to
Lessee on or before the first day of March of each year following the
respective Comparison Year a statement of the increase in rent payable by
Lessee hereunder, but failure by Lessor to give such statement by said date
shall not constitute a waiver by Lessor of its right to require an increase
in rent. Upon receipt of the statement for the first Comparison Year,
Lessee shall pay in full the total amount of increase due for the first
Comparison Year, and in addition for the then current year, the amount of
any such increase shall be used as an estimate for said current year and
this amount shall be divided into twelve (12) equal monthly installments
and Lessee shall pay to Lessor, concurrently with the regular monthly rent
payment next due following the receipt of such statement, an amount equal
to one (1) monthly installment multiplied by the number of months from
January in the calendar year in which said statement is submitted to the
month of
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such payment, both months inclusive. Subsequent installments shall be payable
concurrently with the regular monthly rent payments for the balance of that
calendar year and shall continue until the next Comparison Year's statement is
rendered. If the next or any succeeding Comparison Year results in a greater
increase in Direct Expenses, then upon receipt of a statement from Lessor,
Lessee shall pay a lump sum equal to such total increase in Direct Expenses over
the Base Year, less the total of the monthly installments of estimated increases
paid in the previous calendar year for which comparison is then being made to
the Base Year; and the estimated monthly installments to be paid for the next
year, following said Comparison Year, shall be adjusted to reflect such
increase. If in any Comparison Year the Lessee's share of Direct Expenses be
less than the preceding year, then upon receipt of Lessor's statement, any
overpayment made by Lessee on the monthly installment basis provided above shall
be credited towards the next monthly rent falling due and the estimated monthly
installments of Direct Expenses to be paid shall be adjusted to reflect such
lower Direct Expenses for the most recent Comparison Year. Even though the term
has expired and Lessee has vacated the Premises, when the final determination is
made of Lessee's share of Direct Expenses for the year in which this Lease
terminates, Lessee shall immediately pay any increase due over the estimated
expenses paid and conversely any overpayment made d expenses decree shall be
immediately rebated by Lessor to Lessee.
(B) UTILITIES. Lessee shall pay prior to delinquency for all water, gas,
hear, light, power, telephone, sewage, air conditioning and ventilating,
scavenger, janitorial, landscaping and all other materials and utilities
supplied to the Premises. If any such services are not separately metered
to Lessee, Lessee shall pay a pro rata share of all charges which are
jointly metered, the determination to be made by Lessor, and payment to be
made by Lessee together with rent as estimated by Lessor. Pro rata share
for purposes hereof shall be 9.06% and may be adjusted reasonably to
reflect actual usage and cost.
ARTICLE 7
Property Taxes
Lessee shall pay prior to delinquency all taxes assessed against and levied
upon trade fixtures, furnishings, equipment and all other personal property of
Lessee contained in the Premises or elsewhere. When possible, Lessee shall
cause said trade fixtures, furnishings, equipment and all other personal
property to be assessed and billed separately from the real property of Lessor.
If any of Lessee's personal property shall be assessed with Lessor's real
property, Lessee shall pay Lessor the taxes attributable to Lessee within ten
(10) days after receipt of a written statement setting forth the taxes
applicable to Lessee's property.
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ARTICLE 8
Use
The Premises shall be used and occupied by Lessee for only the following
purposes and for no other purposes whatsoever without obtaining the prior
written consent of Lessor: Offices & warehouse space.
(A) Lessee shall not do or permit anything to be done in or about the
Premises which will increase the existing rate of insurance upon the
Premises (unless Lessee shall pay any increased premium as a result of such
use or acts) or cause the cancellation of any insurance policy covering
said Premises or any building of which the Premises may be a part, nor
shall Lessee sell or permit to be kept, used or sold in or about said
Premises any articles which may be prohibited by a standard form policy of
fire insurance.
(B) Lessee shall not do or permit anything to be done in or about the
Premises which will in any way obstruct or interfere with the rights of
other tenants or occupants of any building of which the Premises may be a
part or injure or annoy them or use or allow the Premises to be used for
any unlawful or objectionable purpose, nor shall Lessee cause, maintain or
permit any nuisance in, an or about the Premises. Lessee shall not commit
or suffer to be committed any waste in or upon the Premises.
(C) Lessee shall not use the Premises or permit anything to be done in or
about the Premises which will in any way conflict with any law, statute,
zoning restriction, ordinance or governmental rule or regulation or
requirements or duly constituted public authorities now in force or which
may hereafter be enacted or promulgated. Lessee shall at its sole cost and
expense promptly comply with all laws, statutes, ordinances and
governmental rules, regulations or requirements now in force or which may
hereafter be in force and with the requirements of any board of fire
underwriters or other similar body now or hereafter constituted relating to
or affecting the condition, use or occupancy of the Premises. The judgment
of any court of competent jurisdiction or the admission of Lessee in any
action against Lessee, whether Lessor be a party thereto or not, that
Lessee has violated any law, statute, ordinance or governmental rule,
regulation or covenant, shall be conclusive of that fact as between Lessor
and Lessee.
(D) Lessee understands and acknowledges that using the Premises as
permanent lodging or residence is prohibited by this lease and by local
zoning ordinances. Lessee further understands and acknowledges that Lessee
may not "build out" or construct any tenant improvements in the Premises
incident to use of the Premises as a residence, including, but not limited
to, a kitchen or a bedroom. Lessee certifies that the premises shall not
be used as a residence. Further, Lessee expressly agrees to indemnify the
Lessor and to hold the Lessor harmless in the event Lessor is subject to
any liability, either civil or criminal, including, but not limited to, any
expense, fines, levies,
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liens or other assessments, expenses or liabilities incurred as a result of
any proceeding by any person or governmental entity, as a result of
Lessee's violation of these terms.
ARTICLE 9
Condition of Premises
If the Premises are completed as of the date of execution hereof, then
Lessee, by execution of this Lease, shall be deemed to have accepted the
Premises in the condition existing as of the date of execution and in any event
this Lease shall be subject to all applicable zoning ordinances and to any
municipal, county and state laws and regulations governing and regulating the
use of the Premises. Lessee acknowledges that neither Lessor nor Lessor's agent
has made any representation or warranty as to the suitability of the Premises
for the conduct of Lessee's business.
ARTICLE 10
Maintenance, Repair and Alterations
Lessee shall keep in good order, condition and repair the Premises and
every part thereof, structural and non structural, (whether or not such portion
of the Premises requiring repair, or the means of repairing the same are
reasonably or readily accessible to Lessee, and whether or not the need for such
repairs occurs as a result of Lessee's use, including, without limiting the
generality of the foregoing, all plumbing, heating, air conditioning, (Lessee
shall procure and maintain, at Lessee's expense, an air conditioning system
maintenance contract, if applicable) ventilating, electrical, lighting
facilities and equipment within the Premises, fixtures, walls, (interior and
exterior), ceilings, floors, windows, doors, plate glass and skylights located
within the Premises.
(A) Lessor's Rights. If Lessee fails to perform Lessee's obligations under
this Article 10, or under any other paragraph of the Lease, Lessor may at
its option (but shall not be required to) enter upon the Premises after ten
(10) days' prior written notice to Lessee (except in the case of an
emergency, in which case no notice shall be required), perform such
obligations on Lessee's behalf and put the same in good order, condition
and repair, and the cost thereof together with interest thereon at the
maximum rate then allowable by law shall become due and payable as
additional rental to Lessor together with Lessee's next rental installment.
(B) Lessor's Obligations. Except for the obligations of Lessor under
Article 9 (relating to Lessor's warranty), Article 14 (relating to
destruction of the Premises) and under Article 15 (relating to condemnation
of the Premises), it is intended by the parties hereto that Lessor have no
obligation, in any manner whatsoever, to repair and maintain the Premises
nor the building located thereon nor the equipment therein, whether
structural or non structural, all of which obligations are intended to be
that of the Lessee tinder Article 10 hereof. Lessee expressly waives the
benefit of any statute
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now or hereinafter in effect which would otherwise afford Lessee the right
to make repairs at Lessor's expense or to terminate this Lease because of
Lessor's failure to keep the Premises in good order, condition and repair.
(C) Lessee shall not, without Lessor's prior written consent make any
alterations, improvements, additions or Utility Installations in, on or
about the Premises, except for nonstructural alterations not exceeding
$10,00, -in cumulative costs during the term of this Lease. In any event,
whether or not in excess of $2,500 in cumulative cost, Lessee shall make no
change or alteration to the exterior of the Premises nor the exterior of
the building(s) on the Premises without Lessor's prior written consent,
less those alterations approved in Exhibit "C."
(1) As used in this Article 10 (C) the term "Utility Installation"
shall mean carpeting, window coverings, air lines, power panels,
electrical distribution systems, lighting fixtures, space heaters, air
conditioning, plumbing, and fencing. Lessor may require that Lessee
remove any or all of said alterations, improvements, additions or
Utility Installations at the expiration of the term, and restore the
Premises to their prior condition. Lessor may require Lessee to
provide Lessor, at Lessee's sole cost and expense, a lien and
completion bond in an amount equal to one and one-half times the
estimated cost of such improvements, to insure Lessor against any
liability for mechanic's and materialmen's liens and to insure
completion of the work. Should Lessee make any alterations or
improvements, additions or Utility Installations without the prior
approval of Lessor, Lessor may require that Lessee remove any or all
of the same, less those alterations approved in Exhibit "C."
(2) Any alterations, improvements, additions or Utility Installations
in, or about the Premises that Lessee shall desire to make and which
requires the consent of the Lessor shall be presented to Lessor in
written form, with proposed detailed plans. If Lessor shall give its
consent, the consent shall be deemed conditioned upon Lessee acquiring
a permit to do so from appropriate governmental agencies, the
furnishing of a copy thereof to Lessor prior to the commencement of
the work and the compliance by Lessee of a I conditions of said permit
in a prompt and expeditious manner.
(3) Lessee shall pay, when due, all claims for labor or materials
furnished or alleged to have been furnished to or for Lessee at or for
use in the Premises, which claims are or may be secured by any
mechanics' lien against the Premises or any interest therein. Lessee
shall give Lessor not less than ten (10) days' notice prior to the
commencement of any work in the Premises, and Lessor shall have the
right to post notices of non-responsibility in or on the Premises as
provided by law. If Lessee shall, in good faith, contest the validity
of
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any such adverse judgment that may be rendered thereon before the
enforcement thereof against the Lessor or the Premises, upon the
condition that if Lessor shall require, Lessee shall furnish to Lessor
a surety bond satisfactory to Lessor in an amount equal to such
contested lien claim or demand indemnifying Lessor against liability
for the same and holding the Premises free from the effect of such
lien or claim. In addition, Lessor may require Lessee to pay Lessor's
attorneys fees and costs in participating in such action if Lessor
shall decide it is to its best interest to do so.
(4) Unless Lessor requires their removal, as set forth in Article 10
(C), all alterations, improvement, additions and Utility Installations
(whether or not such Utility Installations constitute trade fixtures
of Lessee), which may be made on the Premises, shall become the
property of the Lessor and remain upon and be surrendered with the
Premises at the expiration of the term. Notwithstanding the
provisions of this Article 10 (C), Lessee's machinery and equipment,
other than that which is affixed to the Premises so that it cannot be
removed without material damage to the Premises, shall remain the
property of Lessee and may be removed by Lessee subject to the
provisions of Article 11.
ARTICLE 11
Surrender of Premises
On the last day of the term hereof, or on any sooner termination, Lessee
shall surrender the Premises to Lessor in the same condition as when received,
ordinary wear and tear excepted, clean and free of debris. Lessee shall repair
any damage to the Premises occasioned by the installation or removal of Lessee's
trade fixtures, furnishings and equipment. Notwithstanding anything to the
contrary otherwise stated in this Lease, Lessee shall leave the air lines, power
panels, electrical distributions systems, lighting fixtures, space heaters, air
conditioning, plumbing and fencing on the Premises in good operating condition.
ARTICLE 12
Liability Insurance
Lessee shall, at Lessee's expense, obtain and keep in force during the term
of this Lease a policy of comprehensive public liability insurance insuring
Lessor and Lessee against any liability arising out of the ownership, use,
occupancy or maintenance of the Premises and all area appurtenant thereto. The
limit of said insurance shall not, however, limit the liability of the Lessee
hereunder. Lessee may carry said insurance under a blanket policy, providing,
however, said insurance by Lessee shall have a Lessor's protective liability
endorsement attached thereto. If Lessee shall fail to procure and maintain said
insurance, Lessor may, but shall not be required to, procure and maintain same,
but at the expense of the Lessee. Insurance required hereunder, shall be in
companies rated A+ or better in "Best's
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Insurance Guide". Lessee shall deliver to Lessor prior to occupancy of the
Premises copies of policies of liability insurance required herein or
certificates evidencing the existence and amounts of such insurance with loss
payable clauses satisfactory to Lessor. No policy shall be cancelable or subject
to reduction of coverage except after ten (10) days' prior written notice to
Lessor.
ARTICLE 13
Subrogation
As long as their respective insurers so permit, Lessor and Lessee hereby
mutually waive their respective rights of recovery against each other for any
loss insured by fire, extended coverage and other property insurance policies
existing for the benefit of the respective parties. Each party shall obtain any
special endorsements, if required by their insurer to evidence compliance with
the aforementioned waiver.
ARTICLE 14
Damage or Destruction
(A) Partial Damage -- Insured. In the event improvements on the Premises
are damaged by any casualty which is covered under an insurance policy
required to be maintained pursuant to Article 13, then Lessor shall repair
such damage as soon as reasonably possible and this Lease shall continue in
full force and effect.
(B) Partial Damage -- Uninsured. In the event the improvements on the
Premises are damaged, except by a negligent or willful act or omission of
Lessee, by any casualty not covered under an insurance policy required to
be maintained pursuant to Article 12, then Lessor may, at Lessor's option,
either:
(1) repair such damage as soon as reasonably possible at Lessor's
expense, in which event this Lease shall continue in full force and
effect, or
(2) give written notice to Lessee within thirty (30) days after the
date of occurrence of such damage of Lessor's intention to cancel and
terminate this Lease as of the date of the occurrence of the damage.
In the event Lessor elects to terminate this Lease pursuant to this
Article 14 (B), Lessee shall have the right within ten (10) days after
receipt of the required notice to notify Lessor in writing of Lessee's
intention to repair such damage at Lessee's expense, without
reimbursement from Lessor, in which event this Lease shall continue in
full force and effect, and Lessee shall proceed to make such repairs
as soon as reasonably possible. If Lessee does not give such notice
within the ten (10) day period, this Lease shall be canceled and
terminated as of the date of the occurrence of such damage.
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(C) Total Destruction. If the Premises are totally destroyed during the
term of this Lease from any cause whether or not covered by the insurance
required under Article 13 (including any destruction required by any
authorized public authority), this Lease shall automatically terminate as
of the date of such total destruction.
(D) Damage Near End of The Term. If the Premises are partially destroyed
or damaged during the last six (6) months of the terms of this Lease,
Lessor may at Lessor's option cancel and terminate this Lease as of the
date of occurrence of such damage by giving written notice to Lessee of
Lessor's election to do so within thirty (30) days after the date of
occurrence of such damage.
(E) Lessor's Obligations. The Lessor shall not be required to repair any
injury or damage by fire or other cause, or to make any restoration or
replacement of any panelings, decorations, office fixtures, partitions,
railings, ceilings, floor covering, equipment, machinery or fixtures or any
other improvements or property installed in the Premises by Lessee or at
the direct or indirect expense of Lessee. Lessee shall be required to
restore or replace same in the event of damage.
(F) Abatement of Rent; Lessee's Remedies.
(1) If the premises are partially destroyed or damaged and Lessor or
Lessee repairs them pursuant to this Lease, the rent payable hereunder
for the period during which such damage and repair continues shall be
abated in proportion to the extent to which Lessee's use of the
Premises is impaired. Except for abatement of rent, if any, Lessee
shall have no claim against Lessor for any damage suffered by reason
of any such damage, destruction, repair or restoration.
(2) If Lessor shall be obligated to repair or restore the Premises
under this Section 14 and shall not commence such repair or
restoration within ninety (90) days after such obligation shall
accrue, Lessee at Lessee's option may cancel and terminate this Lease
by written notice to Lessor at any time prior to the commencement of
such repair or restoration. In such event this Lease shall terminate
as of the date of such notice.
(G) Termination -- Advance Payments. Upon termination of this Lease
pursuant to Article 14, an equitable adjustment shall be made concerning
advance rent and any advance payments made by Lessee to Lessor. Lessor
shall, in addition, return to Lessee so much of Lessee's security deposit
as has not theretofore been applied by Lessor.
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ARTICLE 15
Condemnation
(A) If the premises or any portion thereof are taken under the power of
eminent domain, or sold by Lessor under the threat of the exercise of said
power (all of which is herein referred to as "condemnation"), this Lease
shall terminate as to the part so taken as of the date the condemning
authority takes title or possession, whichever occurs first. If more than
ten percent (10%) of the floor area of any buildings on the Premises, or
more than twenty-five percent (25%) of the land area of the Premises not
covered with buildings, is taken by condemnation, either Lessor or Lessee
may terminate this Lease, as of the date the condemning authority takes
possession, by notice in writing of such election within twenty (20) days
after Lessor shall have notified Lessee of the taking, or in the absence of
such notice then within twenty (20) days after the condemning authority
shall have taken possession.
(B) If this Lease is not terminated by either Lessor or Lessee then it
shall remain in full force and effect as to the portion of the Premises
remaining, provided the rent shall be reduced in the proportion that the
floor area of the buildings taken within the Premises bears to the total
floor area of all buildings located on the Premises. In the event this
Lease is not so terminated then Lessor agrees, at Lessor's sole cost, to
restore the Premises to a complete unit of like quality and character as
existed prior to the condemnation as soon as reasonably possible. All
awards for the taking of any part of the Premises or any payment made under
the threat of the exercise of compensation for diminution of value of a
leasehold or for the taking of the fee or as severance damages; provided,
however, that Lessee shall be entitled to any award for loss of or damage
to Lessee's trade fixtures and removable personal property. In the event
that this Lease is not terminated by reason of such in connection with such
condemnation, Lessor shall, to the extent of severance damages received by
Lessor in connection with such condemnation, repair any damage to the
Premises caused by such condemnation except to the extent that Lessee has
been reimbursed therefor by the condemning authority. Lessee shall pay any
amount in excess of such severance damages required to complete such
repair.
ARTICLE 16
Liens
Lessee shall keep the Premises and the property in which the Premises are
situated free from any liens arising out of any work performed, materials
furnished or obligations incurred by Lessee. Lessor may require, a t Lessor's
sole option, that Lessee shall provide to Lessor, at Lessee's sole cost and
expense, a lien and completion bond in an amount equal to one and one-half times
any and all estimated cost of any improvements, additions, or alterations in the
Premises, to insure Lessor
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against any liability for mechanics' and material men's liens and to insure
completion of the work.
ARTICLE 17
Assignment and Subletting
Lessee shall not mortgage, pledge, hypothecate or encumber this Lease or
any interest therein. Lessee shall not assign this Lease or sublet, or suffer
any other person (the agents and servants of Lessee excepted) to occupy or use,
the Premises, or any part thereof, or any right or privilege appurtenant thereto
without the prior written consent of Lessor first had and obtained, which
consent shall not be unreasonably withheld. Lessor's consent to one assignment
or subletting shall not be deemed to be a consent to any subsequent assignment
or subletting, nor shall Lessor's consent release Lessee from any of its
obligations under this Lease unless such consent expressly so provides. Any
assignment, subletting, occupation or use without the consent of Lessor shall be
void and, at the option of Lessor, shall terminate this Lease.
(A) In the event at any time or times during the Term of this Lease Lessee
desires to sublet all or part of the Premises, Lessor reserves the prior
right and option to:
(1) sublet from Lessee any portion of the Premises proposed by Lessee
to be sublet for the term for which such portion is proposed to be
sublet but at the same rent (including escalation as provided for in
Article 6 hereof) as Lessee is required to pay to Lessor under this
Lease for the same space, computed on a pro rata of square footage
basis or
(2) terminate this Lease as it pertains to the portion of the
Premises so proposed by Lessee to be sublet. Lessee shall notify
Lessor in writing if Lessee proposes to sublet all or any part of the
Premises, designating the space proposed to be sublet and the terms of
the proposed subletting. Lessor shall be allowed fifteen (15) days
after Lessor's foregoing option. If Lessor fails to exercise its said
option, all the provisions of Article 17 subparagraph (1) above,
respecting subletting, nevertheless shall be in full force and effect
and nothing contained in this subparagraph (2) shall be construed as a
waiver by Lessor of any of its rights under said subparagraph (1).
(B) Lessor's foregoing right and option shall continue throughout the
entire term of this Lease.
(C) In no event shall Lessee assign this Lease or sublet the Premises or
any portion thereof to any then-existing lessee of the building, unless
affirmed in writing by the Lessor.
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ARTICLE 18
Hold Harmless
Lessee shall indemnify and hold harmless Lessor against and from any and
all claims arising from Lessee's use of the Premises for the conduct of its
business or from any activity, work, or other thing done, permitted or suffered
by the Lessee in or about the Premises, and shall further indemnify and hold
harmless Lessor against and from any and all claims arising from any breach or
default in the performance of any obligation on Lessee's part to be performed
under the terms of this Lease, or arising from any act or negligence of the
Lessee, or any officer, agent, employee, guest, or invitee of Lessee, and from
all and against all cost, attorney's fees, expenses and liabilities incurred in
or about any such claim or any action or proceeding brought thereon, and, in any
case, action or proceeding be brought against Lessor by reason of any such
claim, Lessee upon notice from Lessor shall defend the same a t Lessee's expense
by counsel reasonably satisfactory to Lessor. Lessee as a material part of the
consideration to Lessor hereby assumes all risk of damage to property or injury
to persons, in, upon or about the Premises, from any cause other than Lessor's
negligence, and Lessee hereby waives all claims in respect thereof against
Lessor. Lessor or its agents shall not be liable for any damage to property
entrusted to employees of the Building, nor for loss or its agents shall not be
liable for any damage to property entrusted to employees of the Building, nor
for loss or damage to any property by theft or otherwise, nor for any injury to
or damage to persons or property resulting from fire, explosion, falling
plaster, steam, gas, electricity, water or rain which may leak from any part of
the Building or from the pipes, appliances or plumbing works therein or from the
roof, street or subsurface or from any other place resulting from dampness or
any other cause whatsoever, unless caused by or due to the negligence of Lessor,
its agents, servants or employees. Lessor or its agents shall not be liable for
interference with the light or other incorporeal hereditaments, loss of business
by Lessee, nor shall Lessor be liable for any latent defect in the Premises or
in the Building. Lessee shall give prompt notice to Lessor in case of fire or
accidents in the Premises or in the Building or of defects therein or in the
fixtures or equipment.
ARTICLE 19
Rules and Regulations
Lessee shall faithfully observe and comply with the rules and regulations,
indicated on Exhibit "A" attached hereto and hereby reference thereto made a
part hereof, that Lessor shall from time to time promulgate. Lessor reserves the
right from time to time to make all reasonable modifications to said rules. The
additions and modifications to those rules shall be binding upon Lessee upon
delivery of a copy of them to Lessee. Lessor shall not be responsible to Lessee
for the nonperformance of any said rules by any other tenants or occupants.
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ARTICLE 20
Holding Over
If Lessee remains in possession of the Premises or any part thereof after
the expiration of the term hereof, with the express written consent of Lessor,
such occupancy shall be a tenancy from month to month and a rental in the amount
equal to 125% of the last monthly rental, plus all other charges payable
hereunder, and upon all the terms hereof applicable to a month to month tenancy.
ARTICLE 21
Entry By Lessor
Lessor reserves and shall at any and all times have the right to enter the
Premises, inspect the same, supply janitorial service and any other service to
be provided by Lessor to Lessee hereunder, to submit said Premises to
prospective purchasers or tenants, to post notices of non-responsibility, and to
alter, improve or repair the Premises and any portion of the Building of which
the Premises are a part that Lessor may deem necessary or desirable, without
abatement of rent and may for that purpose erect scaffolding and other necessary
structures where reasonably required by the character of the work to be
performed, always providing that the entrance to the Premises shall not be
blocked thereby, and further providing that the business of the Lessee shall not
be interfered with unreasonably. Lessee hereby waives any claim for damages or
for any injury or inconvenience to or interference with Lessee's business, any
loss of occupancy or quiet enjoyment of the Premises, and any other loss
occasioned thereby. For each of the aforesaid purposes, Lessor shall at all
times have and retain a key with which to unlock all of the doors in, upon and
about the Premises, excluding Lessee's vaults, safes and files, and Lessor shall
have the right to use any and all means which Lessor may deem proper to open
said doors in an emergency, in order to obtain entry to the Premises without
liability to Lessee except for any failure to exercise due care for Lessee's
property. Any entry to the Premises obtained by Lessor by any of said means, or
otherwise shall not under any circumstances be construed or deemed to be a
forcible or unlawful entry into, or a detainer of, the Premises, or an eviction
of Lessee from the Premises or any portion thereof.
ARTICLE 22
Estoppel
Lessee shall at any time and from time to time upon not less than ten (10)
days' prior written notice from Lessor execute, acknowledge and deliver to
Lessor a statement in writing,
(A) certifying that this Lease is unmodified and in full force and effect
(or, if modified, stating the mature of such modification and certifying
that this Lease as so modified, is in full force and effect), and the date
to which the rental and other charges are paid in advance, if any, and
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(B) acknowledging that there are not, to Lessee's knowledge, any uncured
defaults on the part of the Lessor hereunder, or specifying such defaults
if any are claimed.
Any such statement may be relied upon by any prospective purchaser or
encumbrancer of all or any portion of the real property of which the Premises
are a part.
ARTICLE 23
Reconstruction
In the event the Premises or the Building of which the Premises are a part
are damaged by fire or other perils covered by extended coverage insurance,
Lessor agrees to forthwith repair the same; and this Lease shall remain in full
force and effect, except that Lessee shall be entitled to a proportionate
reduction of the rent while such repairs are being made, such proportionate
reduction to be based upon the extent to which the making of such repairs shall
materially interfere with the business carried on by the Lessee in the Premises.
If the damage is due to the fault or neglect of Lessee or its employees, there
shall be no abatement of rent.
(A) In the event the Premises or the Building of which the Premises are a
part are damaged as a result of any cause other than the perils covered by
fire and extended coverage insurance, then Lessor shall forthwith repair
(1) to repair or restore such damage, this Lease continuing in full
force and effect, but the rent to be proportionately reduced as herein
above in this Article provided; or
(2) give notice to Lessee at any time within sixty (60) days after
such damage terminating this Lease as of the date specified in such
notice, which date shall be no less than thirty (30) days and no more
than sixty (60) days after the giving of such notice. In the event of
giving such notice, this Lease shall expire and all interest of the
Lessee in the Premises shall terminate on the date so specified in
such notice and the rent, reduced by a proportionate amount, based
upon the extent, if any, to which such damage materially interfered
with the business carried on by the Lessee in the Premises, shall be
paid up to date of said such termination.
(B) Notwithstanding anything to the contrary contained in this Article,
Lessor shall not have any obligation whatsoever to repair, reconstruct or
restore the Premises when the damage resulting from any casualty covered
under this Article occurs during the last twelve (12) months of the term of
this Lease or any extension thereof. Lessor shall not be required to repair
any injury or damage by fire or other cause, or to make any repairs or
replacements of any panels, decoration, office fixtures, railings, floor
15
covering, partitions, or any other property installed in the Premises by
Lessee.
(C) The Lessee shall not be entitled to any compensation or damages from
Lessor for loss of the use of the whole or any part of the Premises,
Lessee's personal property or any inconvenience or annoyance occasioned by
such damage, repair, reconstruction or restoration.
ARTICLE 24
Authority of Parties
Corporate Authority. If Lessee is a corporation, each individual executing
this lease on behalf of said corporation represents and warrants that he is duly
authorized to execute and deliver this Lease on behalf of said corporation, in
accordance with a duly adopted resolution of the board of directors of said
corporation or in accordance with the by-laws of said corporation, and that this
Lease is binding upon said corporation in accordance with its terms.
Limited Partnerships. If the Lessor herein is a limited partnership, it is
understood and agreed that any claims by Lessee on Lessor shall be limited to
the assets of the limited partnership, and furthermore, Lessee expressly waives
any and all rights to proceed against the individual partners or the officers,
directors or shareholders of any corporate partner, except to the extent of
their interest in said limited partnership.
ARTICLE 25
Default
The occurrence of any one or more of the following events shall constitute
a default and breach of the Lease by Lessee.
(A) The vacating or abandonment of the Premises by Lessee.
(B) The failure by Lessee to make any payment of rent or any other payment
required to be made by Lessee hereunder, as and when due, where such
failure shall continue for a period of three (3) days after written notice
thereof by Lessor to Lessee.
(C) The failure by Lessee to observe or perform any of the covenants,
conditions or provisions of this Lease to be observed or performed by the
Lessee, other than described in Article 25 (B) above, where such failure
shall continue for a period of thirty (30) days after written notice
thereof by Lessor to Lessee; provided, however, that if the nature of
Lessee's default is such that more than thirty (30) days are reasonable
required for its cure, then Lessee shall not be deemed to be in default if
Lessee commences such cure within said thirty (30) day period and
thereafter diligently prosecutes such cure to completion.
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(D) The making by Lessee of any general assignment or general arrangement
for the benefit of creditors; or the filing by or against Lessee of a
petition to have Lessee adjudged a bankrupt, or a petition or
reorganization or arrangement under any law relating to bankruptcy (unless,
in the case of a petition filed against Lessee, the same is dismissed
within sixty (60) days); or the appointment of a trustee or a receiver to
take possession of substantially all of Lessee's assets located at the
Premises or of Lessee's interest in this Lease, where possession is not
restored to Lessee within thirty (30) days; or the attachment, execution or
other judicial seizure of substantially all of Lessee's assets located at
the Premises or of Lessee's interest in this Lease, where such seizure is
not discharged in thirty (30) days.
ARTICLE 26
Remedies in Default
In the event of any such material default or breach by Lessee, Lessor may
at any time thereafter, with or without notice or demand and without limiting
Lessor in the exercise of a right or remedy which Lessor may have by reason of
such default or breach:
(A) Terminate Lessee's right to possession of the Premises by any lawful
means, in which case this Lease shall terminate and Lessee shall
immediately surrender possession of the Premises to Lessor. In such event
Lessor shall be entitled to recover from Lessee all damages incurred by
Lessor by reason of Lessee's default including, but not limited to, the
cost of recovering possession of the Premises; expenses of reletting,
including necessary renovation and alteration of the Premises, reasonable
attorney's fees, any real estate commission actually paid; the worth at the
time of award by the court having jurisdiction thereof of the amount by
which the unpaid rent for the balance of the term after the time of such
award exceeds the amount of such rental loss for the same period that
Lessee proves could be reasonable avoided; that portion of the leasing
commission paid by Lessor and applicable to the unexpired term of this
Lease. Unpaid installments of rent or other sums shall bear interest from
the date due at the rate of ten (10%) per cent per annum. In the event
Lessee shall have abandoned the Premises, Lessor shall have the option of:
(1) taking possession of the Premises and recovering from Lessee the
amount specified in this paragraph, or
(2) proceeding under the provision of the following Article 26 (B).
(B) Maintain Lessee's right to possession, in which case this Lease shall
continue in effect whether or not Lessee shall have abandoned the Premises.
In such event Lessor shall be entitled to enforce all of Lessor's rights
and
17
remedies under this Lease, including the right to recover the rent as it
becomes due hereunder.
(C) Pursue any other remedy now or hereafter available to Lessor under the
laws or judicial decision of the State in which the Premises are located.
ARTICLE 27
General Provisions
(A) Plats and Riders. Clauses, plats and riders, if any, signed by the
Lessor and the Lessee and endorsed on or affixed to this Lease are a part
hereof.
(B) Waiver. The waiver by Lessor of any term, covenant or condition herein
contained shall not be deemed to be a waiver of such term, covenant or
condition on any subsequent breach of the same or any other term, covenant
or condition herein contained. The subsequent acceptance of rent hereunder
by Lessor shall not be deemed to be a waiver of any preceding breach by
Lessee of any term, covenant or condition of this Lease, other than the
failure of the Lessee to pay the particular rental so accepted, regardless
of Lessor's knowledge of such preceding breach at the time of the
acceptance of such rent.
(C) Notices. All notices and demands which may or are to be required or
permitted to be given by either party to the other hereunder shall be in
writing. All notices and demands by the Lessee to the Lessor shall be sent
by United States Mail, postage prepaid, addressed to the Lessor at the
Office of the Building, or to such other person or place as the Lessor may
from time to time designate in a notice to the Lessee.
(D) Joint Obligation. If there be more than one Lessee the obligations
hereunder imposed upon Lessees shall be joint and several.
(E) Marginal Headings. The marginal headings and Article titles to the
Articles of this Lease are not a part of this Lease and shall have no
effect upon the construction or interpretation of any part hereof.
(F) Time. Time is of the essence of this Lease and each and all of its
provisions in which performance is a factor.
(G) Successors and Assigns. The covenants and conditions herein contained,
subject to the provisions as to assignment, apply to and bind the heirs,
successors, executors, administrators and assigns of the parties thereto.
(H) Recordation. Neither Lessor nor Lessee shall record this Lease or a
short form memorandum hereof without the prior written consent of the other
party.
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(I) Quiet Possession. Upon Lessee paying the rent reserved hereunder and
observing and performing all of the covenants, conditions and provisions on
Lessee's part to be observed and performed hereunder, Lessee shall have
quiet possession of the Premises for the entire term hereof, subject to all
the provisions of this Lease.
(J) Late Charges. Lessee hereby acknowledges that late payment by Lessee
to Lessor of rent or other sums due hereunder will cause Lessor to incur
costs not contemplated by this Lease, the exact amount of which will be
extremely difficult to ascertain. Such costs include, but are not limited
to, processing and accounting charges, and late charges which may be
imposed upon Lessor by terms of any mortgage or trust deed covering the
Premises. Accordingly, if any installment of rent or of a sum due from
Lessee shall not be received by Lessor or Lessor's designee within ten (10)
days after said amount is due, then Lessee shall pay to Lessor a late
charge equal to ten (10%) per cent of such over due amount. The parties
hereby agree that such late charges represent a fair and reasonable
estimate of the cost that Lessor will incur by reason of the late payment
by Lessee. Acceptance of such late charges by the Lessor shall in no event
constitute a waiver of Lessee's default with respect to such overdue
amount, nor prevent Lessor from exercising any of the other rights and
remedies granted hereunder.
(K) Prior Agreements. This Lease contains all of the agreements of the
parties hereto with respect to any matter covered or mentioned in this
Lease, and no prior agreements or understanding pertaining to any such
matters shall be effective for any purpose. No provision of this Lease may
be amended or added to except by an agreement in writing signed by the
parties hereto or their respective successors in interest. This Lease shall
not be effective or binding on any party until fully executed by both
parties hereto.
(L) Inability to Perform. This Lease and the obligations of the Lessee
hereunder shall not be affected or impaired because the Lessor is unable to
fulfill any of its obligations hereunder or is delayed in doing so, if such
inability or delay is caused by reason of strike, labor troubles, acts of
God, or any other cause beyond the reasonable control of the Lessor.
(M) Attorneys' Fees. In the event of any action or proceeding brought by
either party against the other under this Lease the prevailing party shall
be entitled to recover all costs and expenses including the fees of its
attorneys in such action or proceeding in such amount as the court may
adjudge reasonable as attorneys' fees.
(N) Sale of Premises by Lessor. In the event of any sale of the Building,
Lessor shall be and is hereby entirely freed and relieved of all liability
under any and all of its covenants and obligations contained in or after
the consummation of such sale; and the purchaser, at such sale or any
subsequent sale of the Premises shall be deemed, without any further
agreement between
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the parties or their successors in interest or between the parties and any
such purchaser, to have assumed and agreed to carry out any and all of the
covenants and obligations of the Lessor under this Lease.
(O) Subordination, Attornment. Upon request of the Lessor, Lessee will in
writing subordinate its rights hereunder to the lien of any first mortgage,
or first deed of trust to any bank, insurance company or other lending
institution, now or hereafter in force against the land and Building of
which the Premises are a part, and upon any buildings hereafter placed upon
the land of which the Premises are a part, and to all advances made or
hereafter to be made upon the security thereof. In the event any
proceedings are brought for foreclosure, or in the event of the exercise of
the power of sale under any mortgage or deed or trust made by the Lessor
covering the Premises, the Lessee shall attorn to the purchaser upon any
such foreclosure or sale and recognize such purchaser as the Lessor under
this Lease. The provision of this Article to the contrary notwithstanding,
and so long as Lessee is not in default hereunder, this Lease shall remain
in full force and effect for the full term hereof.
(P) Name. Lessee shall not use the name of the Building or of the
development in which the Building is situated for any purpose other than as
an address of the business to be conducted by the Lessee in the Premises.
(Q) Separability. Any provision of this Lease which shall prove to be
invalid, void or illegal shall in no way affect, impair or invalidate any
other provision hereof and such other provision shall remain in full force
and effect.
(R) Cumulative Remedies. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other
remedies at law or in equity.
(S) Choice of Law. This Lease shall be governed by the laws of the State
in which the Premises are located.
(T) Signs and Auctions. Lessee shall not place any sign upon the Premises
or Building or conduct any auction thereon without Lessor's prior written
consent.
ARTICLE 28
Non-Discrimination
Lessee herein covenants by and for himself, his heirs, executors,
administrators and assigns, and all persons claiming under or through him, and
this Lease is made and accepted upon and subject to the following conditions:
That there shall be no discrimination against or segregation of any person
or group of persons on account of race, color, creed, national origin or
ancestry, in the
20
leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the
premises herein leased, nor shall Lessee himself, or any persons claiming under
or through him, establish or permit any such practice or practices of
discrimination or segregation with reference to the selection, location, number,
use or occupancy of Lessees, Lessors, sublessors, sublessees or vendees in the
premises herein leased.
ARTICLE 29
Lessor's Agents
It is understood and agreed that this Lease is executed by Xxxxxxx and
Company solely in their capacity as Lessor's agents and said Xxxxxxx and Company
shall not be obligated to perform any of the terms, conditions or covenants to
be performed by Lessor herein, nor in any way be liable hereunder.
ARTICLE 30
Brokers
Lessee warrants that it has had no dealings with any real estate broker or
agents in connection with the negotiation of this Lease excepting only None and
it knows of no other real estate broker or agent who is entitled to a commission
in connection with this Lease.
If this Lease has been filled in, it has been prepared for submission to
your attorney for his approval. No representation or recommendation is made by
the real estate broker or its agents or employees as to the legal sufficiency,
legal effect, or tax consequences of this Lease or the transactions relating
thereto.
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THE PARTIES HERETO HAVE EXECUTED THIS LEASE AT THE PLACE AND ON THE DATE
SPECIFIED IMMEDIATELY ADJACENT TO THEIR RESPECTIVE SIGNATURES.
"LESSOR
000 XXXXX XXXXXX ASSOCIATES
c/o Intereal Corporation
000 Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxxxx, XX 00000
By:____________________________
Title: Agent For Owner Dated: 8/17/99
-------------------------
"LESSEE"
XXXX.XXX
a Delaware corporation
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------
Title: CEO Dated 8/16/99
-------------------------
By: _________________________
Title: COO Dated 8/16/99
-------------------------
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