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EXHIBIT 10.6
LEASE AGREEMENT
THIS LEASE, executed in duplicate as of the 5th day of December, 1996 by and
between XXXXX ROAD INVESTMENTS NO. 3, a Partnership (hereinafter called
"Landlord"); and ASPEC TECHNOLOGY, INC., a California corporation (hereinafter
called "Tenant").
WITNESSETH:
1. PREMISES. Landlord hereby leases to Tenant and Tenant hereby hires
and takes from Landlord those certain premises (the "Premises") shown or
outlined in red on Exhibit "A," situated in Sunnyvale, County of Santa Xxxxx,
State of California, and more particularly described as follows:
That approximate 29,000 sq. ft. industrial-office space commonly known
as 000 Xxxx Xxxxxx Xxxxxx and/or 000 Xxxxx Xxxxx Xxxx, Xxxxxxxxx, XX
together with all interior improvements situated thereon, which space
and Premises is a portion of that approximate 48,500 sq. ft.
industrial-office building situated on an approximate 2.9 acre Parcel
of real property located on the southeasterly corner of Xxxxx Road and
East Arques Avenue, Sunnyvale, CA (the "Building") also as shown or
partly shown on Exhibit "A." Such Premises is leased in "AS IS"
condition except as otherwise provided in section 37. "IMPROVEMENTS"
hereof.
The term "Premises" as used throughout this Lease is hereby defined to include
(i) any improvements now or hereafter installed therein or attached thereto,
and (ii) the reasonable non-exclusive use of sidewalks and driveways in front
of or adjacent to the Premises, and parking areas located on the parcel of land
on which the Building is situated, except such parking areas as may be leased
or reserved for exclusive use by other tenant(s). Tenant's such reasonable use
of parking areas shall not exceed that percent of the total parking areas which
is equal to the ratio which floor space of the Premises bears to floor space of
the entire Building. The leased area of the Premises shall be measured from
outside of exterior walls to outside of interior walls, and shall include any
covered entrances or egresses, and any covered or depressed loading areas Said
letting and hiring is upon and subject to the terms, covenants and conditions
hereinafter set forth and Tenant covenants as a material part of the
consideration for this Lease to perform and observe each and all of said terms,
covenants and conditions.
2. TERM. The term of this Lease shall be for a period of five (5) years
(unless sooner terminated as hereinafter provided), and (subject to Section 3.)
shall commence on the lst day of December, 1996 and end on the 30th day of
November, 2001.
3. POSSESSION. Anything herein to the contrary notwithstanding:
A. Possession of the Premises shall be deemed tendered and the
term of the Lease shall commence on December 1, 1996.
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B. Tenant shall have the right to occupy the southwesterly
approximate one-half of the space formerly occupied by Ando Corp. during the
period of time that Landlord is improving the northwesterly one-half thereof;
and after Landlord has finished improving the northwesterly one-half thereof,
Tenant shall move out of such southwesterly one-half into the northwesterly
one-half during the period that Landlord is improving such southwesterly
one-half of such space pursuant to the terms hereof.
4. USE. Tenant shall use the Premises only in conformance with
applicable governmental laws, regulations. rules and ordinances for the
purpose of general office. R&D, light manufacturing, storage and other legal
uses related thereto, and no other purpose. Tenant shall not do, keep or
permit to be done or kept in or about the Premises anything which is prohibited
by or will in any way increase the existing rate of or cause the cancellation
of any insurance covering the Premises or any of its contents; nor shall Tenant
sell or permit to be kept, used, leased or sold, in or about said Premises, any
article which may be prohibited by the standard form of fire insurance policies
or which will in any way obstruct or interfere with the rights or quiet
enjoyment of other occupants of the Premises or neighboring premises, or
injure, annoy or disturb them; and Tenant will not allow the Premises to be
used for any unlawful purpose, nor shall Tenant cause, maintain or permit any
nuisance in, on or about the Premises. No sale by auction shall be permitted
on the Premises without Landlord's prior written consent. Tenant shall not
place any loads upon the floors, walls, ceiling or roof which might endanger or
damage the structure; nor place or spill, nor suffer to be placed or spilled,
any harmful substances or Hazardous Materials in the drainage system of the
Building, nor on the Premises. the Building nor the Parcel of land. nor
overload any electrical, mechanical, plumbing, sprinkler, or other systems. No
waste materials or refuse shall be permitted to remain upon any part of the
Premises nor outside of the Building in which the Premises are a part, except
in trash container(s) placed inside exterior enclosures approved by Landlord
for that purpose, or inside of the Building proper where designated by
Landlord. No materials, supplies, equipment, finished products or
semi-finished products, raw materials or articles of any nature shall be stored
or permitted to remain on the roof (other than air conditioning units) nor
outside the Premises. Tenant shall not place anything or allow anything to be
placed near any window or door which may appear unsightly from outside the
Premises. No loudspeaker or other device, system or apparatus which can be
heard outside the Premises shall be used in or at the Premises without the
prior written consent of Landlord. Tenant shall not commit or suffer to be
committed any waste in or upon the Premises. Tenant covenants and agrees that
no diminution of light. air or view by any structure which may be hereafter
erected (whether or not by Landlord) nor use of the Building by other occupants
nor use of neighboring buildings or areas by others shall in any way affect
this Lease, entitle Tenant to any reduction of rent hereunder or result in any
liability of Landlord to Tenant. Tenant shall comply with any covenant,
condition or restriction affecting the Premises. The provisions of this
paragraph are for the benefit of Landlord only and shall not be construed to be
for the benefit of any other person, or occupant of the Premises.
5. RENT.
A. Basic Rent. Tenant agrees to pay to Landlord at such place as
Landlord may from time to time designate without deduction, offset, abatement,
prior notice, or demand, and Landlord
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agrees to accept as Basic Rent for the leased Premises, the total sum of TWO
MILLION ONE THOUSAND & 00/100 Dollars ($2,001,000.00) in lawful money of the
United States of America, payable as follows:
The sum of $30,450.00 payable each month from December 1, 1996 through
November 30, 1997
The sum of $31,900.00 payable each month from December 1, 1997 through
November 30, 1998.
The sum of $33,350.00 payable each month from December 1, 1998 through
November 30, 1999.
The sum of $34,800.00 payable each month from December 1, 1999 through
November 30, 2000.
The sum of $36,250.00 payable each month from December 1, 2000 through
November 30, 2001.
B. Time for Payment. Full monthly Basic Rent is due in advance
on the first day of each calendar month. In the event that the term of this
Lease commences on a date other than the first day of a calendar month, then an
the date of commencement of such term Tenant shall pay to Landlord as Basic
Rent for the period from such date of commencement to the first day of the next
succeeding calendar month that proportion of the first month's Basic Rent due
hereunder which the number of days between such date of commencement and the
first day of the next succeeding calendar month bears to thirty (30). In the
event that the term of this Lease for any reason ends on a date other than the
last day of a calendar month then on the first day of the last partial calendar
month of such term Tenant shall pay to Landlord as Basic Rent for the period
from said first day of said last partial calendar month to and including the
last day of the term hereof that proportion of the monthly Basic Rent then due
hereunder which the number of days between said first day of said last partial
calendar month and the last day of the term hereof bears to thirty (30).
C. Late Charges and Interest. Notwithstanding any other
provision of this Lease, if Tenant is in default in the payment of any rent (as
set forth in this Section 5) when due, or any part thereof, Tenant acknowledges
that late payment by Tenant to Landlord of rent will cause Landlord to incur
costs which are extremely difficult and impracticable to fix Such costs
include, without limitation, processing and accounting charges, and late
charges that may be imposed on Landlord by the terms of any encumbrance and
note secured by any encumbrance covering the Premises. extraordinary interest
charges, penalties, collection costs, attorney(ies) and accountant(s) fees, and
the like. Therefore, if any rent due from Tenant under this Section 5. is not
received by Landlord within ten (10) days of when due, Tenant shall pay to
Landlord an additional sum of ten (10%) percent of the overdue rent as a late
charge. The parties agree that this late charge represents a fair and
reasonable estimate of the costs that Landlord will incur by reason of late
payment by Tenant. In addition to the above, Tenant shall pay to Landlord
simple interest on any rent or any other sums due hereunder which are from time
to time in default under the terms hereof, at a per annum rate of interest
equal to three (3%) percent above the prime rate of interest per annum as
periodically quoted by the Bank of America, which interest shall be prorated to
the period which such rent or other sums remain unpaid and in default.
Acceptance of any late charge or interest
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payment shall not constitute a waiver of Tenant's default with respect to the
overdue amount, nor prevent Landlord from exercising any of the other rights
and remedies available to Landlord.
D. Additional Rent. Within ten (10) days after receipt of
invoice(s) therefore, Tenant shall pay to Landlord or to Landlord's designated
agent or entity (in addition to Basic Rent and) as Additional Rent which shall
be solely calculated and determined by Landlord, the following:
(1) All Taxes relating to the Premises as set forth in
Section 11, and
(2) All insurance premiums relating to the Premises, as
set forth in Section 13, and
(3) All charges. costs, expenses and other amounts which
Tenant is required to pay hereunder, together with all interest, late charges,
costs and expenses, including without limitation reasonable attorneys' fees,
legal and accounting expenses, collection costs, and court costs, that may
accrue thereto or be incurred in the event of Tenant's default, refusal or
failure to pay such amounts, and all damages, reasonable costs and expenses
which Landlord may incur by reason of any default by Tenant or failure on
Tenant's part to comply with the terms of this Lease. In the event of failure
by Tenant to pay such Additional Rent in accordance with the terms hereof,
Landlord shall have all the rights and remedies with respect thereto as
Landlord has for nonpayment of Basic Rent.
E. The term "rent" shall include without limitation "Basic Rent" and
"Additional Rent."
6. SECURITY DEPOSIT. Concurrently with Tenant's execution of this Lease,
Tenant shall deposit with Landlord the additional sum of TWENTY FOUR THOUSAND
NINE HUNDRED TWO & 00/100 Dollars $24,902.00) to be added to the Security
Deposit held by Landlord under the terms of Section 6. of that certain Lease
Agreement dated as of April 15, 1994 by and between Xxxxx Road Investments No.
3, Landlord, and Aspec Technology, Inc., Tenant. Such total Security Deposit
shall therefore be a sum equal to the last month's Basic Rent vis. THIRTY SIX
THOUSAND TWO HUNDRED FIFTY & 00/100 Dollars ($36,250.00). Said sum shall be
held by Landlord as a Security Deposit for the full and faithful performance by
Tenant of all of the terms, covenants, and conditions of this Lease to be kept
and performed by Tenant during the term hereof. If Tenant defaults with
respect to any provision of this Lease, including, without limitation, the
provisions relating to the payment of rent and any of the monetary sums due
hereunder, Landlord 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 in default, or
for any amount which Landlord may spend by reason of Tenant's default, of to
compensate Landlord for any other loss, damage, liability or expense which
Landlord may suffer by reason of Tenant's default. If any portion of said
Security Deposit is so used, applied or retained, then Tenant shall, within ten
(10) days after written demand therefor, deposit cash with Landlord in the
amount sufficient to restore the Security Deposit to its original amount.
Tenant's failure to do so shall be a material breach of this Lease. Landlord
shall not be required to keep this Security Deposit separate from its general
funds, and Tenant shall not be entitled to interest on such Deposit. If Tenant
fully and faithfully performs and observes every provision of this Lease to be
performed and observed by Tenant, the Security Deposit or any then unused
balance thereof shall
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be returned to Tenant (or at Landlord's option, to the last assignee of
Tenant's interest hereunder) after the expiration of the Lease term and after
Tenant has vacated and surrendered the Premises in accordance with the terms
hereof. Tenant shall not have the right to apply this Security Deposit or any
part thereof toward the payment of any rent or sums due hereunder. In the
event of termination of Landlord's interest in this Lease, Landlord shall
transfer the unused balance of said Deposit to Landlord's successor in interest
whereupon Tenant hereby agrees to release Landlord from liability for the
return of such Deposit.
7. ACCEPTANCE AND SURRENDER OF PREMISES. By entry therein, Tenant
accepts the Premises as being in good and sanitary order, condition and repair
and accepts the Building and improvements included in the Premises in their
present condition and without representation or warranty by Landlord as to the
condition of such Building or as to the use of occupancy which may be made
thereof. Any exceptions to the foregoing must be by written agreement executed
by Landlord and Tenant. Tenant agrees on the last day of the Lease term, or on
the sooner termination of this Lease, to surrender the Premises promptly and
peaceably to Landlord in good condition and repair (damage by Acts of God,
fire, normal wear and tear excepted), including without limitation, all
interior walls freshly painted, or cleaned so that they appear freshly painted;
all tile floors cleaned and waxed; all carpets cleaned and shampooed; all
broken, marred, stained or nonconforming acoustical ceiling tiles replaced; all
windows washed inside and out, the air conditioning and heating systems
serviced by a reputable and licensed service firm, left in good operating
condition and repair as so certified to by such firm; the plumbing, electrical
and lighting systems left in good order and repair, including replacement of
any burned out, discolored or broken light bulbs, ballasts or lenses, the lawn,
shrubs and trees in good condition including the replacement of any dead or
damaged plantings; the sidewalk, driveways and parking areas in good order,
condition and repair, any damaged surface or other portion having been repaired
or replaced, together with all alterations, additions, and improvements which
may have been made in, to, or on the Premises (except moveable trade fixtures
installed at the expense of Tenant), provided that Tenant shall ascertain from
Landlord within thirty (30) days before the end of the term of this Lease
whether Landlord desires to have the Premises or any part(s) thereof restored
to their original condition and configuration as when the Premises was
delivered to Tenant, and if Landlord shall so desire, then Tenant shall so
restore said Premises or such perils) thereof prior to the termination of this
Lease at Tenant's sole cost and expense. Tenant shall, on or before the
termination of this Lease, remove all of Tenant's personal property and trade
fixtures from the Premises, and all property not so removed on or before the
end of the term or sooner termination of this Lease shall be deemed abandoned
by Tenant and title to same shall thereupon pass to Landlord without
compensation to Tenant. Landlord may, upon termination of this Lease, remove,
store and/or sell all moveable personal property and trade fixtures so
abandoned by Tenant, at Tenant's sole cost, and repair any damage caused by
such removal at Tenant's sole cost. If the Premises be not surrendered at the
end of the term or sooner termination of this Lease, then Tenant shall
indemnity Landlord against loss or liability resulting from the delay by Tenant
in so surrendering the Premises, including, without limitation, any claims made
by any succeeding tenant founded an such delay. No act or conduct of Landlord,
whether consisting of the acceptance of the keys to the Premises, or otherwise,
shall be deemed to be or constitute an acceptance of the surrender of the
Premises by Tenant prior to the expiration of the Term hereof, and acceptance
by Landlord of surrender by
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Tenant shall only flow from and must be evidenced by a written acknowledgment
of acceptance of surrender signed by Landlord. The voluntary or other
surrender of this Lease or the Premises by Tenant or a mutual cancellation of
this Lease shall not work as a merger and, at the option of Landlord, shall
either terminate all existing subleases or operate as an assignment or
attornment to Landlord of such subleases as Landlord may elect to retain.
After the expiration or earlier termination of this Lease, Tenant shall
execute, acknowledge and deliver to Landlord, within ten (10) days after
written demand from Landlord to Tenant, any quitclaim deed or other document
required by any reputable title company, licensed to operate in the State of
California, to remove the cloud or encumbrance created by this Lease from the
real property containing the Premises.
8. ALTERATIONS AND ADDITIONS. Tenant shall not make, or suffer to be
made, any alteration or addition to the Premises, or any part thereof, without
the express prior written detailed request to and consent of Landlord first
obtained by Tenant (which consent shall not be unreasonably withheld or
delayed). Any repairs, replacements, additions, or alterations to the Premises
shall be made at Tenant's sole cost and expense and shall become at once a part
of the Premises and belong to Landlord, except that Tenant shall retain title
to all moveable furniture and trade fixtures installed at Tenant's sole cost.
Landlord reserves the right to approve all contractors and mechanics proposed
by Tenant to make such alterations and additions. Unless otherwise expressly
provided by such written consent, all such repairs, replacements, alterations
and additions shall be of the same materials and shall conform to the same
design and building standards as existed in the Premises upon the date Tenant
first took possession thereof. All heating, plumbing, lighting, electrical,
air conditioning, partitioning, wall coverings, doors, glass, draperies, window
shades, ceilings, carpeting, and floor installations made by Tenant, together
with all property that has become an integral part of the Premises, shall not
be deemed trade fixtures. Tenant agrees that it will not proceed to make such
alterations or additions until ten (1 0) days after having received written
consent from Landlord to do so, in order that Landlord may post appropriate
notices to avoid any liability to contractors or material suppliers for payment
for Tenant's alterations and additions. Tenant will at all times permit such
notices to be posted and remain posted until the completion of work. Tenant
shall, if required by Landlord, secure at Tenant's own cost and expense, a
completion and lien indemnity bond (satisfactory to Landlord) for such work.
Tenant further covenants and agrees that any mechanics lien filed against the
Premises for work claimed to have been done for Tenant or materials claimed to
have been furnished to Tenant, will be paid or discharged by Tenant, by bond or
otherwise, within fifteen (15) days after the filing thereof, at the sole cost
and expense of Tenant.
9. TENANT MAINTENANCE. Tenant shall at all times and at its sole cost
and expense, keep, repair, replace and maintain the Premises (including
appurtenances) and every part thereof in good, clean and first-class condition;
including (without limitation) janitorial, garbage collection, all windows
(interior and exterior), window frames, plate glass and glazing (destroyed by
accident or act of third parties), truck doors, plumbing systems (such as water
and drain lines, sinks, toilets. faucets, drains, showers and water fountains),
electrical systems (such as panels, conduits, outlets, lighting fixtures,
lamps, bulbs, tubes and ballasts), heating and air conditioning systems (such
as compressors, fans, air handlers, ducts, mixing boxes, thermostats, time
clocks, boilers, heaters, supply and return grills) which shall at least
quarterly be fully serviced and repaired by a reputable
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and licensed HVAC service firm, (previously approved in writing by Landlord)
and a copy of each such service report shall be sent to Landlord immediately
after each such service; structural elements and interior surfaces of the
Premises, store fronts, roofs. roof membranes, down spouts, wall coverings,
window coverings, carpet, floor coverings, partitioning, ceilings, doors (both
interior and exterior), including closing mechanisms, latches, locks, skylights
(if any), fire extinguishing systems and equipment, elevators (if any) and all
other interior improvements of any nature whatsoever, all exterior improvements
including but not limited to sidewalks, driveways, parking lots, landscaping
areas, sprinkler systems, lighting, signs, fountains, waterways and drains.
Tenant agrees to provide carpet xxxxxxx under all roiling personal property (it
requested by Landlord), and to be responsible for wear and tear of the carpet
caused by any roiling or other equipment if such wear and tear exceeds that
caused by normal foot traffic in surrounding areas, and areas of excessive wear
shall be replaced at Tenant's sole expense upon Lease termination. Tenant
hereby waives all rights under, and benefits of, Subsection 1. of Section 1932
and Section 1941 and 1942 of the California Civil Code and under any similar
law, statute or ordinance now or hereafter in effect. In the event any of the
above maintenance responsibilities jointly apply to Tenant and other tenant(s)
of Landlord where there is common usage with other tenant(s), such maintenance
responsibilities and charges shall be allocated to the Premises by square
footage or other equitable basis as calculated and determined by Landlord.
10. UTILITIES AND SERVICES. Tenant shall (within ten (10) days after
receiving an invoice therefor) pay directly to the entity or authority
providing and/or billing the same (or reimburse the entity paying for the same,
as the case may be), all charges for water, gas, electricity. telephone, telex
and other electronic communication service, sewer service, waste and refuse
collection, and any other utilities, materials or services furnished directly
or indirectly to, for the benefit of and/or used by Tenant on or about the
Premises during the term of this Lease, including without limitation any
temporary or permanent utility surcharge, Tenant's pro rate share of
landscaping, parking areas, roof and/or common area maintenance, and/or any
other charges hereinafter imposed. In the event any of the above charges also
apply jointly to other tenant(s) of Landlord where there is a common meter or
common usage with other tenant(s), Tenant shall allocate, adjust, reimburse
and/or pay such charges on a temporary or permanent basis (as the case may be)
directly to, from or with such other tenant(s), and Tenant shall seek and shall
be solely responsible for reimbursement directly from such other tenant(s) for
any such charges which may be reimbursable to Tenant. Failing such direct
allocation or adjustment, such charges may (at Landlord's option) be allocated
to the Premises by square footage or other equitable basis (for example a PG&E
usage survey payable at the expense of the tenants involved) as finally
calculated and determined solely by Landlord. The PG&E meters for PG&E service
for the Building are adjacent to Tenant's premises, and such meters and such
service for the Building shall be transferred to and be in Tenant's name during
the term of this Lease. In no event shall Landlord be liable for any such
charges, xxxxxxxx, payment, advancement of money for payment, or reimbursement
to or from others for or with respect to any of the above services, utilities,
materials, or charges, and Tenant shall not be entitled to any abatement or
reduction of rent by reason of any interruption or failure of utilities,
materials, or services to the Premises during the Lease term.
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11. TAXES.
A. Real Property Taxes. Tenant shall pay to Landlord all Real
Property Taxes relating to the Premises, which shall be considered as
Additional Rent payable in accordance with Section 5.D. of this Lease. In the
event the Premises leased hereunder consists of only a portion of the entire
parcel being taxed, Tenant shall pay to Landlord the proportionate share of
such Real Property Taxes allocated to the Premises during the term of this
Lease by square footage or other reasonable basis as calculated and determined
solely by Landlord. If the tax billing pertains entirely to the Premises, and
Landlord elects by written notice to Tenant to have Tenant pay such Real
Property Taxes directly to the Tax Collector, then in such event it shall be
the responsibility of Tenant to obtain all tax and assessment bills pertaining
to the Premises, and to pay (prior to delinquency) all Real Property Taxes
pertaining to the Premises, and all interest and penalties (if any) for
non-payment or late payment thereof. Failure to request or receive a xxxx for
taxes and/or assessments shall not alter or extinguish Tenant's responsibility
to pay the above. The term "Real Property Taxes." as used herein, shall mean
and include (i) all taxes, assessments, levies and other charges of any kind or
nature whatsoever, general and special, foreseen and unforeseen (including.
without limitation, all installments of principal and interest required to pay
any general or special assessments for public improvements, and any increases
resulting from reassessments caused by any change in ownership of the Premises
or otherwise) now or hereafter imposed by any governmental or quasi-
governmental authority or special district having the direct or indirect power
to tax or levy assessments, which are levied or assessed against, or with
respect to the value, occupancy, or use of all or any portion of the Premises
(as now constructed or as may at any time hereafter be constructed, altered, or
otherwise changed) or Landlord's interest therein: any improvements located
within the Premises (regardless of ownership); the fixtures, equipment and
other property of Landlord, real or personal, that are an integral part of and
located in the Premises; and landscaping areas, walkways, parking areas, public
utilities, or energy within the Premises, (ii) all charges, levies or fees
imposed by reason of environmental regulation or other governmental control of
the Premises, and (iii) all costs and fees (including reasonable attorneys'
fees) incurred by Landlord or Tenant in reasonably contesting any Real Property
Tax and in negotiating with public authorities as to any Real Property Tax. If
at any time during the term of this Lease the taxation or assessment of the
Premises prevailing as of the commencement date of this Lease shall be altered
so that in lieu of or in addition to any Real Property Tax described above
there shall be levied, assessed or imposed (whether by reason of a change in
the method of taxation or assessment, creation of a new tax or charge, or any
other cause) an alternate or additional tax or charge (i) on the value, use or
occupancy of the Premises or Landlord's interest therein or (ii) on or measured
by the gross receipts, income or rentals from the Premises, on Landlord's
business of leasing the Premises, or based on vehicular ownership, parking,
employment, production or the like, or computed in any manner with respect to
the operation of the Premises, then any such tax or charge, however designated,
shall be included within the meaning of the term "Real Property Taxes" for
purposes of this Lease. If any Real Property Tax is based in part upon
property or rents unrelated to the Premises, then only that part of such Real
Property Tax that is fairly allocable to the Premises shall be included within
the meaning of the term "Real Property Taxes." Notwithstanding the foregoing,
the term "Real Property Taxes" shall not include estate, inheritance, gift or
franchise
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taxes of Landlord or the federal or state net income tax imposed on Landlord's
income from all sources.
B. Taxes on Tenant's Property. Tenant shall be liable for and
shall pay directly to the appropriate authority prior to delinquency, all taxes
levied against or applicable to any personal property or trade fixtures owned
by Tenant or others and/or placed by Tenant in or about the Premises, during
the leased Term, and any interest or penalties applicable thereto (if any) for
non-payment or late payment.
12. TENANT'S INSURANCE. Tenant agrees, at Tenant's expense, to secure and
keep in force during the term of this Lease a policy of comprehensive general
liability insurance for personal injury (including death) and property damage
occurring in, on or about the Premises, including without limitation parking,
walkways and landscaped areas, in the minimum amount of $2,000,000 combined
single limit. Such insurance shall be primary and noncontributory with respect
to any insurance carried by Landlord. Such policy(ies) shall name Landlord as
additional insured(s), shall insure any liability of Landlord, contingent or
otherwise, with respect to acts or omissions of Tenant, its agents, employees
or invitees by any conduct or transactions of any of said persons in, about or
concerning the Premises, including (without limitation) any failure of Tenant
to observe or perform any of its obligations hereunder, and shall contain the
insurer's waiver of subrogation against Landlord, its agents, employees and
invitees. Such policy(ies) shall insure performance by Tenant of the indemnity
provisions of Section 14. hereof. Such policy(ies) shall be issued by an
insurance company licensed to transact business in the State of California and
rated no less than A12 by Best's, and shall provide that such insurance shall
not be canceled or materially amended, except upon ten (10) days prior written
notice to Landlord. Tenant shall at all times maintain a current copy or
detailed certificate of said policy(ies) with Landlord. Tenant shall at
Tenant's cost maintain policy(ies) of insurance in "all risk" form with a
sprinkler damage endorsement insuring the replacement value of all personal
property, inventory, trade fixtures, and leasehold improvements within the
Premises for the full replacement value thereof. The proceeds from any of such
policies shall be used for the repair or replacement of such items so insured.
Tenant shall also maintain policy(ies) of workmen's compensation insurance and
any other employee benefit insurance sufficient to comply with all laws.
Tenant shall, at his cost and expense, comply with any and all requirements,
pertaining to said Premises of any insurance organization or company, necessary
for the maintenance of reasonable fire and public liability insurance.
13. REAL PROPERTY INSURANCE. Landlord shall purchase and keep in force
policy(ies) of insurance covering loss or damage to the Premises by reason of
fire (extended coverage), flood, and those perils included within the
classification of "all risks" insurance (with sprinkler damage and other
appropriate endorsements), which insurance shall be in the amount of the full
replacement value of the Premises as determined by insurance company appraisers
or Landlord's insurance broker, plus Landlord's liability insurance; plus
rental income insurance in the amount of one hundred (100%) percent of up to
twelve (12) months Basic Rent (plus sums paid during such period as Additional
Rent). Such coverage shall exclude routine maintenance and repairs and
incidental damage or destruction caused by accidents or vandalism for which
Tenant is responsible under Section 9. Tenant agrees to pay to Landlord as
Additional Rent in accordance with
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Section 5.D. of this Lease the cost of such insurance coverage; or if Tenant
does not lease the entire Building, then Tenant's proportionate share of the
cost of such insurance coverage which shall be allocated during the term of
this Lease to the Premises by building square footage or other equitable basis
as calculated and determined solely by Landlord or Landlord's insurance broker.
If such insurance cost is increased due to Tenant's particular use of the
Premises. Tenant agrees to pay to Landlord the full cost of such increase.
Tenant shall have no interest in nor any right to the proceeds of any insurance
procured by Landlord for or with respect to the Premises.
14. INDEMNIFICATION & MUTUAL WAIVER.
A. Release and Waiver of Subrogation. The parties hereto release
each other, and their respective agents and employees, from any liability for
injury to any person or damage to property that is caused by or results from
any risk insured against under any valid and collectible insurance policy
carried by either of the parties which contains a waiver of subrogation by the
insurer and is in force at the time of such injury or damage; subject to the
following limitations: (i) the foregoing provision shall not apply to the
commercial general liability insurance described by Sections 12. and 13., (ii)
such release shall apply to liability resulting from any risk insured against
or covered by self-insurance maintained or provided by Tenant to satisfy the
requirements of Section 12 to the extent permitted by this Lease. and (iii)
Tenant shall not be released from any such liability to the extent any damages
resulting from such injury or damage are not covered by the recovery obtained
by Landlord from such insurance, but only it the insurance in question permits
such partial release in connection with obtaining a waiver of subrogation from
the insurer. This release shall be in effect only so long as the applicable
insurance policy contains a clause to the effect that this release shall not
affect the right of the insured to recover under such policy. Each party shall
use reasonable efforts to cause each insurance policy obtained by it to provide
that the insurer waives all right of recovery by way of subrogation against the
other party and its agents and employees in connection with any injury or
damage covered by such policy. However, if any insurance policy cannot be
obtained with such a waiver of subrogation. or if such waiver of subrogation is
only available at additional cost and the party for whose benefit the waiver is
to be obtained does not pay such additional cost, then the party obtaining such
insurance shall notify the other party of that fact and thereupon shall be
relieved of the obligation to obtain such waiver of subrogation rights from the
insurer with respect to the particular insurance involved.
B. Indemnification of Landlord. Tenant shall hold harmless,
indemnity and defend Landlord, and its employees, agents, invitees and
contractors, with competent counsel reasonably satisfactory to Landlord, from
all liability, penalties, losses, damages, costs, expenses, causes of action,
claims and/or judgments arising by reason of any death, bodily injury, personal
injury or property damage resulting from (i) any cause or causes whatsoever
(other than the willful misconduct or gross negligence of Landlord of which
Landlord has had notice and a reasonable time to cure, but which Landlord has
failed to cure) occurring in or about or resulting from an occurrence in or
about the Premises during the Lease Term, (ii) the negligence or willful
misconduct of Tenant or its agents, employees, invitees and contractors,
wherever the same may occur, or (iii) any breach or default of Tenant
hereunder. The provisions of this Section 14.B. shall survive the expiration
or sooner termination of this Lease.
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C. Indemnification of Tenant. Landlord shall defend, indemnify
and hold harmless Tenant from any loss, liability, damage, cost and expense
arising from the negligence or willful misconduct of Landlord, and its
employees, agents and contractors with respect lo the Premises.
15. ASSIGNMENT, SUBLETTING & TRANSFERS.
Transfer By Tenant. The following provisions shall apply to any
assignment, subletting or other transfer by Tenant or any subtenant or
assignee or other successor in interest of the original Tenant (collectively
referred to in this Section 15. as "Tenant"):
A. Tenant shall not do any of the following (collectively
referred to herein as a "Transfer"), whether voluntarily, involuntarily or by
operation of law, without the prior written consent of Landlord, which consent
shall not be unreasonably withheld or delayed: (i) sublet all or any part of
the Premises or allow it to be sublet, occupied or used by any person or entity
other than Tenant; (ii) assign its interest in this Lease; (iii) mortgage or
encumber the Lease (or otherwise use the Lease as a security device) in any
manner; or (iv) materially amend or modify an assignment, sublease or other
transfer that has been previously approved by Landlord. Any Transfer so
approved by Landlord shall not be effective until Tenant has delivered to
Landlord an executed counterpart of the document evidencing the Transfer which
(i) is in a form reasonably approved by Landlord, (ii) contains the same terms
and conditions stated in Tenant's notice given to Landlord pursuant to Section
15.B., and (iii) in the case of an assignment of the Lease, contains the
agreement of the proposed transferee to assume all obligations of the Tenant
under this Lease arising after the effective date of such Transfer and to
remain jointly and severally liable therefor with Tenant. Any attempted
Transfer without Landlord's consent shall constitute an event of Tenant's
default hereunder and shall be voidable at Landlord's option. Landlord's
consent to any one Transfer shall not constitute a waiver of the provisions of
this Section 15. as to any subsequent Transfer or a consent to any subsequent
Transfer. No Transfer, even with the consent of Landlord, shall relieve Tenant
of its personal and primary obligation to pay the rent and to perform all of
the other obligations to be performed by Tenant hereunder. The acceptance of
rent by Landlord from any person or entity shall not be deemed to be a waiver
by Landlord of any provision of this Lease nor to be a consent to any Transfer.
B. At least thirty (30) days before a proposed Transfer is to
become effective, Tenant shall give Landlord written notice of the proposed
terms of such Transfer and request Landlord's approval, which notice shall
include the following: (i) the name and legal composition of the proposed
transferee; (ii) a current financial statement of the transferee, financial
statements of the transferee covering the preceding three years if the same
exist, and (if available) an audited financial statement of the transferee for
a period ending not more than one year prior to the proposed effective date of
the Transfer, all of which statements are prepared in accordance with generally
accepted accounting principles; (iii) the nature of the proposed transferee's
business to be carried on in the Premises; (iv) all consideration to be given
on account of the Transfer; and (v) a current financial statement of Tenant.
Tenant shall provide to Landlord such other information as may be reasonably
requested by Landlord within seven (7) days after Landlord's receipt of such
notice from Tenant. Landlord shall respond in writing to Tenant's request for
Landlord's consent to a Transfer
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within fifteen (15) days after receipt of Tenant's request together with said
required accompanying documentation and such other information requested by
Landlord. If Landlord fails to respond in writing within said fifteen (15) day
period, Landlord will be deemed to have withheld consent to such Transfer.
Tenant shall immediately notify Landlord of any material modification to the
proposed terms of such Transfer.
C. If Landlord consents to a Transfer proposed by Tenant, Tenant
may enter into such Transfer, and if Tenant does so, the following shall apply:
(1) Tenant shall not be released of its liability for all
of its obligations under the Lease.
(2) If Tenant assigns its interest in this Lease, then
Tenant shall pay to Landlord (in addition to all rent and other sums
otherwise payable under this Lease) all Subrent (as defined in Section
15.C.(5)) received by Tenant over and above (i) the assignee's agreement to
assume the obligations of Tenant under this Lease, and (ii) all Permitted
Transfer Costs related to such assignment. In the case of assignment, the
amount of Subrent owed to Landlord shall be paid to Landlord on the same basis,
whether periodic or in lump sum, that such Subrent is paid to Tenant by the
assignee.
(3) If Tenant sublets any part of the Premises, then
with respect to the spaces subleased, Tenant shall pay to Landlord (in addition
to all rent and other sums payable under this Lease) the positive difference,
if any, between (i) all Subrent paid by the subtenant to Tenant, less (ii) the
sum of all Basic Rent and Additional Rent allocable to the space sublet and all
Permitted Transfer Costs related to such sublease. Such amount shall be paid
to Landlord on the same basis, whether periodic or in lump sum, that such
Subrent is paid to Tenant by its subtenant. In calculating Landlord's share of
any periodic payments, all Permitted Transfer Costs shall be first recovered by
Tenant.
(4) Tenant's obligations under this Section 15.C. shall
survive any Transfer, and Tenant's failure to perform its obligations hereunder
shall be an event of Tenant's default hereunder. At the time Tenant makes any
payment to Landlord required by this Section 15.C., Tenant shall deliver an
itemized statement of the method by which the amount lo which Landlord is
entitled was calculated, certified by Tenant as true and correct. Landlord
shall have the right at reasonable intervals to inspect Tenant's books and
records relating to the payments due hereunder. Upon request therefor, Tenant
shall deliver to Landlord copies of all bills, invoices or other documents upon
which its calculations are based. Landlord may condition its approval of any
Transfer upon obtaining a certification from both Tenant and the proposed
transferee of all Subrent and other amounts that are to be paid to Tenant in
connection with such Transfer.
(5) As used in this Section 15.C., the term "Subrent"
shall mean any consideration of any kind received, or to be received, by Tenant
as a result of the Transfer, if such sums are related to Tenant's interest in
this Lease or in the Premises, including payments from or on behalf of the
transferee (in excess of the book value thereof) for Tenant's assets, fixtures,
leasehold
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improvements, inventory, accounts, goodwill, equipment, furniture, and general
intangibles. As used in this Section 15.C., the term "Permitted Transfer
Costs" shall mean (i) all reasonable leasing commissions paid to third parties
not affiliated with Tenant in order to obtain the Transfer in question, and
(ii) all reasonable attorneys' fees incurred by Tenant with respect to the
Transfer in question.
D. If Tenant is a corporation, the following shall be deemed a
voluntary assignment of Tenant's interest in this Lease: (i) any dissolution,
merger, consolidation, acquisition of a controlling interest in the corporation
stock of Tenant or acquisition of substantially all of the assets of Tenant, or
other reorganization of or affecting Tenant, whether or not Tenant is the
surviving corporation; and (ii) if the capital stock of Tenant is not publicly
traded, and the sale or transfer is to one person or entity (or to any group of
related persons or entities or persons acting in concert) of stock possessing
more than fifty (50%) percent of the total combined voting power of all classes
of Tenant's capital stock issued, outstanding and entitled to vote for the
election of directors. If Tenant is a partnership, any withdrawal or
substitution (whether voluntary, involuntary or by operation of law, and
whether occurring at one time or over a period of time) of any partner owning
twenty five (25%) percent or more (cumulatively) of any interest in the capital
or profits of the partnership, or the dissolution of the partnership, shall be
deemed a voluntary assignment of Tenant's interest in this Lease. Under any
such voluntary assignment, Tenant (and any assignee(s) or transferee(s)) shall
be and agree to be fully liable for all of the obligations of Tenant under this
Lease.
E. Notwithstanding anything contained in Section 15., so long as
Tenant otherwise complies with the provisions of Section 15., and the assignee,
sublessee or transferee (as the case may be) executes a written agreement
prepared by Landlord assuming all of Tenant's obligations under this Lease,
then Tenant may enter into any of the following transfers (a "Permitted
Transfer') without Landlord's prior written consent, and Landlord shall not be
entitled to terminate the Lease pursuant to Section 15.C. or to receive any
part of any Subrent resulting therefrom that would otherwise be due it pursuant
to Section 15.C.:
(1) Tenant may sublease all or part of the Premises or
assign its interest in this Lease to any corporation which controls, is
controlled by, or is under common control with the original Tenant to this
Lease by means of voting capital stock and equitable ownership interest of more
than fifty (50%) percent. so long as such corporation has a tangible net worth
(as defined below) at the time of such assignment at least equal to or greater
than the tangible net worth of Tenant immediately prior to such transaction.
(2) Tenant may assign its interest in the Lease to a
corporation which results from a merger, consolidation or other reorganization
in which Tenant is not the surviving corporation, so long as the surviving
corporation has a tangible net worth (as defined below) at the time of such
assignment that is equal to or greater than the tangible net worth of Tenant
immediately prior to such transaction.
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(3) Tenant may assign this Lease to a corporation which
purchases or otherwise acquires all or substantially all of the assets of
Tenant, so long as such acquiring corporation has a tangible net worth at the
time of such assignment that is equal to or greater than the tangible net worth
of Tenant immediately prior to such transaction.
For purposes of the foregoing, the term 'Tangible net worth" shall
mean net worth minus intangible assets including without limitation goodwill,
patents, copyrights and other intellectual property.
16. ABANDONMENT. Tenant shall not vacate, surrender or abandon the
Premises at any time during the term of this Lease; and if Tenant shall so
abandon. vacate or surrender said Premises, or be dispossessed by the process
of law, or otherwise, any personal property belonging to Tenant and left on the
Premises shall be deemed to be abandoned, at the option of Landlord.
17. DEFAULT BY TENANT. The failure by Tenant to perform or observe any
covenant or condition to be performed or observed by Tenant under the terms of
this Lease is a breach hereof, and shall constitute a default hereunder by
Tenant upon Tenant's failure to cure such breach (i) within five (5) days after
written notice from Landlord of Tenant's failure to pay any rent or other sum
due hereunder, or (ii) within ten (10) days after written notice from Landlord
of any other breach of this Lease. Upon the occurrence of any uncured breach
or default of this Lease by Tenant, Landlord shall, at its option, have and
exercise the following rights and remedies in addition to any other rights or
remedies available to Landlord it law, in equity, or contained in this Lease,
to-wit:
A. The right to terminate this Lease (i) by giving written notice
to Tenant in accordance with applicable law, or (ii) by judicial judgment of
such termination. Any such termination shall not relieve Tenant from the
payment of any sum(s) then due to Landlord of from any claim for damages or
rent previously accrued or then accruing against Tenant.
B. The rights and remedies provided for by the California Civil
Code Section 1951.2 which allow(s) Landlord (without limitation) to recover the
worth at the time of award of the amount by which the unpaid rent for the
balance of the term after the time of award exceeds the amount of rental loss
for the same period that Tenant proves could be reasonably avoided.
C. The rights and remedies provided by the California Civil Code
Section 1951.4 which allows Landlord to continue the Lease in effect and to
enforce all of its rights and remedies under this Lease, including the right to
recover rent as it becomes due, for so long as Landlord does not terminate
Tenant's right to possession.
D. The right and power of Landlord to enter the Premises and
remove therefrom all persons and property, to store such property in a public
warehouse or elsewhere at the cost of and for the account of Tenant, and to
sell such property and apply such proceeds therefrom pursuant to applicable
California law.
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E. The right and power of Landlord from time to time to re-lease
or sublet the Premises or any part thereof for such term (which may extend
beyond the term of this Lease) and at such rent and upon such other terms as
Landlord in its sole discretion may deem advisable, with the right to make
alterations and repairs to the Premises which are reasonably necessary to
re-let the same. Upon each subletting, rents received from such subletting
shall be applied as follows: first, to payment of indebtedness (other than
rent) due hereunder from Tenant to Landlord; second, to the payment of any
costs of such subletting including (without limitation) attorneys' fees and any
real estate commissions actually paid, and of such alterations and repairs:
third, to payment of rent due and unpaid hereunder; and the residue (if any)
shall be held by Landlord and applied in payment of future rent as the same
becomes due hereunder. If such rental received from such subletting during any
month is less than that to be paid during that month by Tenant hereunder, then
Tenant shall pay any such deficiency to Landlord. which deficiency shall be
calculated and paid monthly.
F. The right to have a receiver appointed for Tenant upon
application by Landlord, to take possession of the Premises and to apply any
rental collected from the Premises and to exercise all other rights and
remedies granted to Landlord pursuant to Subsection D. and E. above.
During any period of time that Tenant is in default under the terms of
this Lease, (i) Landlord shall have no obligation to grant any consent
requested by Tenant hereunder, and (ii) Tenant shall have no right to request.
exercise or enjoy any right or option granted to Tenant hereunder. No act by
Landlord or on behalf of Tenant or Landlord described in this Section 17. of
otherwise in this Lease, including (without limitation) appointment of a
receiver to protect Landlord's interest under this Lease, acts of maintenance
or renovation or preservation, efforts to relet the Premises, obtaining keys or
changing locks, no action or service of unlawful defamer, or taking possession
of the Premises, or other acts by Landlord shall be construed as an election on
Landlord's part to terminate this Lease and effect a surrender thereof unless a
written notice of such intention is given to Tenant; nor shall the same prevent
Landlord from electing at any time thereafter to terminate this Lease for such
previous uncured breach or default.
18. BANKRUPTCY. The commencement or filing of a bankruptcy, liquidation,
reorganization or insolvency action, or the filing of an answer therein, or an
assignment by Tenant for the benefit of creditors, or the appointment of a
trustee or receiver to take possession of the assets of Tenant, or any similar
action undertaken by or on behalf of Tenant, or the levy of an attachment or
execution upon the property or interest of Tenant which is not within five (5)
days satisfied or released, or the insolvency of Tenant, or any of the above
shall at Landlord's option, constitute a breach of this Lease by Tenant. If
the trustee or receiver appointed to serve during a bankruptcy, liquidation,
reorganization, insolvency or similar action elects to reject the unexpired
portion of this Lease, then the trustee or receiver shall notify Landlord in
writing of its election within thirty (30) days after such appointment. Within
thirty (30) days after any court approval of the assumption of this Lease, the
trustee or receiver shall cure all previous breaches and defaults under such
Lease and shall compensate Landlord for all actual pecuniary loss caused by the
same and shall provide adequate assurance of future performance under this
Lease to the reasonable satisfaction of Landlord. Nothing contained in this
Section shall affect the existing right of Landlord to refuse to accept an
assignment upon commencement of or in connection with such a bankruptcy.
liquidation,
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reorganization, or insolvency action or assignment or other similar act. In no
event shall the leasehold estate under this Lease, or any interest therein, be
assigned by voluntary or involuntary bankruptcy proceeding without the prior
written consent of Landlord. In no event shall this Lease or any rights or
privileges hereunder be an asset of Tenant under any bankruptcy, insolvency,
reorganization or other proceedings.
19. LANDLORD'S RIGHT TO PERFORM. All terms, covenants and conditions of
this Lease to be performed or observed by Tenant shall be performed or observed
by Tenant at Tenant's sole cost and expense and without any reduction of rent.
If Tenant shall fail to pay any sum of money required to be paid by it
hereunder, or shall fail to perform or observe any other term hereunder on its
part to be performed or observed, including without limitation those
obligations of Tenant contained in Section 9. Tenant Maintenance, Landlord may,
at its option, without prior notice to Tenant and without waiving or releasing
Tenant from any obligation of Tenant hereunder, thereafter make and continue to
make any such payment or perform or observe any such other term or act on
Tenant's part to be performed or observed. All sums so paid by Landlord and
all reasonably necessary costs of such performance or observation by Landlord
together with interest thereon shall be due and payable by Tenant to Landlord
from the date incurred, and with respect to the same Landlord shall have the
same rights and remedies against Tenant as in the case of nonpayment of rent
hereunder.
20. DEFAULT BY LANDLORD. Landlord shall not be in default hereunder
unless Landlord fails to perform obligations required of Landlord within a
reasonable time, but in no event earlier than thirty (30) days after written
notice by Tenant to Landlord and to the holder of any first mortgage or deed of
trust covering the Premises whose name and address shall have heretofore been
furnished to Tenant in writing, specifying wherein Landlord has failed to
perform such obligations provided, however, that if the nature of Landlord's
obligations is such that more than thirty (30) days are required for
performance, then Landlord shall not be in default if Landlord commences
performance within such thirty (30) day period and thereafter diligently
prosecutes the same to completion. Should Landlord fail to perform said
obligations as above provided, then the sole remedy of Tenant shall be the
performance of such obligations by Tenant with right of reimbursement from
Landlord for the reasonable value of performing the same, not exceeding the sum
actually expended by Tenant.
21. LAWS & REGULATIONS. Tenant, at its sole cost and expense, shall with
respect to its occupancy and use of the Premises, and otherwise. promptly
comply with all applicable laws, statutes, ordinances, permits, and
governmental rules, regulations, directions or requirements now or hereafter in
effect; with the requirements of any board of fire underwriters or other
similar body now or hereafter constituted; with any occupancy certificate,
direction or permit issued pursuant to law by any public officer, and with all
requirements of any insurance organization or company pertaining to the
Premises and necessary for the issuance or maintenance of reasonable insurance
coverage as provided for herein.
22. SIGNS. No sign, placard, picture, advertisement, name or notice shall
be inscribed, displayed, printed or affixed on or to any part of the outside of
the Premises or any exterior windows of the Premises without the prior written
consent of Landlord (which consent shall not be
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unreasonably withheld or delayed), and Landlord shall have the right to remove
the same without notice to and at the expense of Tenant. If Tenant is allowed
to display a sign on or about the Premises, then at Landlord's option upon
expiration or other sooner termination of this Lease, Tenant shall at Tenant's
sole cost both remove such sign, repair all damage caused thereby and restore
the appearance of the Premises to its condition prior to the placement of said
sign. All approved signs (or lettering on outside doors) shall be done at the
expense of Tenant by a person reasonably approved of by Landlord. Tenant shall
have the right to place a dignified painted sign on the main lobby windows (not
exceeding two (2') feet by four (4') feet) identifying the company, and one
sign identifying the company in the landscaping area in front of the Premises
(not to exceed three (3') feet by six (6') feet), subject to prior written
design and placement approval by Landlord and any approvals required by
applicable governmental authorities.
23. HAZARDOUS MATERIALS. Landlord and Tenant agree as follows with
respect to the existence or use of "Hazardous Materials" (as defined herein) on
the Premises:
A. Tenant, at its sole cost, shall comply with all Laws relating
to the storage, use and disposal of Hazardous Materials on the Premises. If
Tenant does store, use or dispose of any Hazardous Materials on the Premises,
Tenant shall notify Landlord in writing at least five (5) days prior to their
first appearance on the Premises. Tenant shall be solely responsible for and
shall defend, indemnify, and hold Landlord and its agents harmless from and
against all claims, costs and liabilities, including attorneys' fees and costs,
arising out of or in connection with such storage, use or disposal of Hazardous
Materials by Tenant, its agents, employees, or contractors.
B. If the presence of Hazardous Materials on the Premises caused
or permitted by Tenant, its agents, employees, invitees, contractors, or
subtenants results in contamination or deterioration of water or soil resulting
in a level of contamination greater than the safe levels established by any
governmental agency having jurisdiction over such contamination, Tenant shall
promptly and at its sole cost take any and all action necessary to investigate
and clean up such contamination. At any time prior to the expiration of the
Lease Term. Tenant may at its sole cost and expense (but only after receipt of
written consent from Landlord) conduct appropriate tests of water and soil and
to deliver to Landlord the results of such tests to demonstrate that no
contamination in excess of permitted levels has occurred as a result of
Tenant's use of the Premises. Tenant shall further be solely responsible for,
and shall defend, indemnify and hold Landlord and its agents harmless from and
against, all claims, costs and liabilities, including attorneys' fees and
costs, arising out of or in connection with any removal, clean-up and
restoration work and materials required hereunder to return the Premises to its
condition existing prior to the appearance of the Hazardous Materials caused or
permitted by Tenant, its agents, employees, contractors, or subtenants.
C. If Landlord has reasonable cause to believe that the Premises
have or may become contaminated by Hazardous Materials, Landlord may (at its
option) cause testing xxxxx to be installed on the Premises, and may cause the
ground water to be tested to detect the presence of Hazardous Materials by the
use of such tests as are then customarily used for such purposes. If Tenant so
requests, Landlord shall supply Tenant with copies of such test results. The
cost of such
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tests and of the installation, maintenance, repair and replacement of such
xxxxx shall be paid by Landlord, except that Tenant shall pay the cost thereof
if the presence of Hazardous Materials is detected and which is probably caused
by Tenant. its agents, employees or contractors. Tenant shall have the right
at any time during the Lease Term to conduct its own test of the ground water
underlying the Property by using such xxxxx so long as each of the following
conditions are satisfied: (i) such tests are conducted by Tenant at its own
expense; (ii) it repairs any damages to such xxxxx caused by such tests; and
(iii) it delivers copies of the results of such tests to Landlord.
D. It shall not be unreasonable for Landlord to withhold its
consent to any proposed Transfer pursuant to Section 15. if the proposed
transferee's anticipated use of the Premises involves the generation, storage,
use, treatment or disposal of Hazardous Material and which in Landlord's
reasonable opinion poses an unacceptable risk of contamination of the Premises.
E. As used herein, the term "Hazardous Material" means any
hazardous or toxic substance, materials or waste, the storage, use, or
disposition of which is or becomes regulated by any local governmental
authority, the State of California or the United States Government. The term
"Hazardous Material" includes, without limitation, any material or substance
which is (i) listed under Article 9 or defined as hazardous or extremely
hazardous pursuant to Article 11 of Title 22 of the California Administrative
Code, Division 4, Chapter 20, (ii) defined as a "hazardous waste" pursuant to
Section 1004 of the Federal Resource Conservation and Recovery Act, 42 U.S.C.
Section 6901 et seq. (42 U.S.C. Section 6903), (iii) defined as a "hazardous
substance" pursuant to Section 101 of the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U S.C. Section 9601 et seq. (42 U.S.C.
Section 960i), or (iv) is listed or defined as "hazardous waste", "hazardous
substance", or other similar designation by any regulatory scheme of the State
of California or the U.S. Government that is similar to the foregoing.
24. LIENS. Tenant shall keep the Premises (and appurtenances) free from
all liens arising out of any work performed for, materials furnished to. or
obligation incurred by Tenant. In the event that Tenant shall not, within ten
(10) days following the imposition of such lien, cause the same to be released
of record, Landlord shall have, in addition to all other remedies provided
herein and by law, the right, but not obligation, to cause the same to be
released by such means as it shall deem proper, including payment of the claim
giving rise to such lien. All sums paid by Landlord for such purpose, and all
expenses incurred by Landlord in connection therewith, shall be payable and
reimbursable to Landlord by Tenant on demand with interest accruing thereon at
three (3) percentage points over the prime rate of interest as quoted from time
to time by the Bank of America.
25. FINANCIAL STATEMENTS. At any time during the Lease Term Tenant
shall, upon fifteen (15) days' prior written notice from Landlord, provide
Tenant's most recent financial statement and financial statements covering the
twenty four (24) month period prior to the date of such most recent financial
statements to any existing Lender, potential Lender or buyer of the Premises.
Such statements shall be prepared in accordance with generally accepted
accounting principles and, if such is the normal practice of Tenant, shall be
audited by an independent certified public accountant.
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26. ENTRY BY LANDLORD. Landlord reserves, and shall at all reasonable
times have, the right to enter the Premises (including Landlord's employees,
contractors, agents and invitees) to inspect the same; to perform any services
to be provided by Landlord hereunder, to make repairs or provide any services
to adjacent tenant(s), to exhibit the Premises to prospective purchasers,
lenders, tenant(s), brokers or others, to place "For Lease" or "For Sale" signs
on the property, to post notices of non responsibility; to alter, improve or
repair the Premises or other parts of the Building; and to erect scaffolding
and other necessary structures in or near the Premises where reasonably
required by the character of the work to be performed; all without abatement of
rent, Landlord agrees that the business of Tenant shall be interfered with to
the least extent that is reasonably practical. Any such entry shall under no
circumstances be construed to be a forcible or unlawful entry into or a
detainer of the Premises or an eviction, actual or constructive of Tenant from
the Premises.
27. DESTRUCTION. In the event the Premises are destroyed in whole or in
part from any cause, other than from the fault of Tenant (its agents or
invitees), routine maintenance, repairs, incidental damage and/or destruction
caused from vandalism and/or accidents for which tenant is responsible under
Section 9., then:
A. If such destruction of the Premises is less than twenty five
(25%) percent of the replacement cost thereof and the restoration thereof can
reasonably be made within sixty (60) days under the laws of applicable
governmental authorities, and such destruction is caused by an event fully
covered by insurance provided for under Section 13. hereof, then Landlord shall
at its expense forthwith repair or rebuild the Premises,
B. If such destruction of the Premises is more than twenty five
(25%) percent of the replacement cost thereof, or the restoration thereof
cannot reasonably be made within sixty (60) days or cannot be made under all
laws and regulations of the applicable governmental authorities, or such
destruction is caused by an event not fully covered by such insurance, or the
Building is damaged or destroyed to an extent of more than forty (40%) percent
of the replacement cost thereof (regardless of whether or not there is any
damage to the Premises), then in any of such events Landlord may at its option
(i) repair and rebuild the Premises and/or Building, or (ii) terminate this
Lease.
Tenant shall be entitled to a reduction in rent while such rebuilding
is being made in the proportion that the area of the Premises rendered
untenantable by such damage (if any) bears to the total area of the Premises.
If Landlord does not complete such required rebuilding within one hundred
eighty (180) days following the date of such destruction (such period of time
to be extended for periods of Unavoidable Delay), then Tenant shall have the
right to terminate this Lease by giving fifteen (15) days prior written notice
to Landlord. Notwithstanding anything herein to the contrary, Landlord's
obligation to rebuild shall be limited to the Building and interior
improvements constructed by Landlord as they existed as of the commencement
date of the Lease and shall not include restoration of Tenant's trade fixtures,
equipment, merchandise, or any improvements, alterations or additions made by
Tenant to the Premises, which Tenant shall forthwith replace or fully repair at
Tenant's sole cost and expense (provided this Lease is not
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terminated according to the above provisions). Unless this Lease is terminated
pursuant to the foregoing provisions, this Lease shall remain in full force and
effect. Tenant hereby expressly waives the provisions of Section 1932,
Subdivision 2, and Section 1933, Subdivision 4 of the California Civil Code,
and the provisions of any statute or other law which may be in effect at the
time of the occurrence of such damage or destruction under which a lease is
automatically terminated or a lessee is given the right to terminate a lease
upon the occurrence of any such damage or destruction. In the event the damage
or destruction of the Premises or Building is caused in whole or in part by
Tenant, its agents, employees, invitees, or contractors, then Tenant shall be
responsible for the same and shall pay (without limitation) the insurance
deductible portion of Landlord's restoration costs. Only work during normal
straight time working hours is contemplated by this Section,
28. CONDEMNATION. If all or any part of the Premises shall be taken by
any public or quasi-public authority under the power of eminent domain (or
conveyance in lieu thereof) this Lease shall terminate as to any portion of the
Premises so taken or conveyed on the date when title vests in the condemnor.
Landlord shall be entitled to any and all payment(s), money(ies) and/or award
(herein called "Compensation") which may be paid or made in connection with
such taking or conveyance, and Tenant shall have no claim to such compensation
nor against Landlord or otherwise for the value of any unexpired term of this
Lease, and Tenant hereby irrevocably waives, relinquishes and assigns to
Landlord all rights to such compensation by reason of such taking or
conveyance. Notwithstanding the foregoing, any money(ies) specifically awarded
Tenant for loss of business, Tenant's personal properly, moving cost or loss of
goodwill, shall be and remain the property of Tenant. In the event of such a
partial taking or conveyance of the Premises, then if the portion of the
Premises taken or conveyed is so substantial that the Tenant can no longer
conduct its business, Tenant shall have the right to terminate this Lease upon
written notice delivered to Landlord within thirty (30) days after the date of
such taking or conveyance, and thereafter this Lease shall terminate on the
last day of the calendar month next following the month in which such notice is
given upon payment by Tenant of the rent from the date of such taking or
conveyance to the date of termination. If all or more than thirty five (35%)
percent of the Premises be so taken or conveyed, then either party may
terminate this Lease upon sixty (60) days prior written notice to the other.
If, however, neither Landlord nor Tenant shall so terminate this Lease, then
this Lease shall continue in full force and effect as to the part of the
Premises not so taken or conveyed, and the rent payable hereunder shall be
apportioned as of the date of such taking or conveyance so that thereafter such
rent shall be payable in the ratio that the value of the portion of the
Premises not so taken or conveyed bears to the total value of the Premises
immediately prior to such taking or conveyance, which value(s) shall be
determined by an MAI appraiser designated by Landlord.
29. SUBORDINATION AND MORTGAGES. In the event Landlord's title or
leasehold interest is now or hereafter encumbered by a deed of trust and/or
other related instruments ("Security Instruments") placed upon the land and
Buildings in which the Premises are located to secure a loan from a lender
("Lender") to Landlord, Tenant shall without any consideration whatsoever,
immediately upon the request of Landlord or Lender, execute in writing (i) an
agreement subordinating Tenant's rights under this Lease to the lien of such
'Security Instruments" or, if so requested (ii) an agreement that the lien of
Lender's Security Instruments shall remain
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subject to and subordinate to the rights of Tenant under this Lease. plus (in)
any releases or other documents incident thereto including, without limitation,
a current statement of Tenant's financial condition. In the event the interest
of Landlord in such land and Buildings is encumbered by a deed of trust, and
such interest is acquired by the Lender or any third party by reason of
foreclosure, then Tenant hereby agrees to attorn to the purchaser at any such
foreclosure and thereafter to recognize such purchaser as the Landlord under
this Lease. Notwithstanding any such subordination or foreclosure, the express
terms of this Lease shall not be modified, and Tenant's rights and possession
under this Lease shall not be disturbed provided that Tenant is not then in
default hereunder and so long as Tenant shall thereafter pay all rent and
observe and perform all of the provisions set forth in this Lease to be
observed and performed by Tenant.
30. ESTOPPEL CERTIFICATE. Tenant shall without any consideration
whatsoever, at any time (within ten (10) days after written notice from
Landlord) execute, acknowledge and deliver to Landlord a signed statement in
writing (i) certifying that this Lease is unmodified and in full force and
effect (or, if modified, staling the nature of such modification and certifying
that this Lease, as so modified, is in full force and effect) and the date to
which the rent and other charges are paid in advance (if any), and (ii)
acknowledging that there are not, to Tenant's knowledge, any uncured defaults
on the part of the Landlord hereunder (or specifying such defaults, if any,
that are claimed). Any such statement may be relied upon by any prospective
purchaser or encumbrancer of the Premises, or others. Tenant's failure to
deliver such statement within such time shall not relieve Tenant of such
obligation, but such failure shall be deemed tantamount to a signed written
statement from Tenant certifying that this Lease is in full force and effect,
without modification except as may be represented by Landlord, and that there
are no uncured defaults in Landlord's performance hereunder, and that not more
than one month's rent has been paid in advance.
31. SALE BY LANDLORD. In the event of a sale, conveyance. assignment or
transfer of the Premises or any interest therein, by Landlord or any owner of
the reversion then constituting Landlord, then in such event Landlord or such
owner shall thereby be released from any further liability or obligation under
any of the terms, covenants or conditions (express or implied) of this Lease in
favor of Tenant; and in such event (as between Landlord or such owner and such
successor in interest) Tenant agrees thereafter to look solely to the successor
in interest of Landlord (or such owner) for further performance of all terms
and obligations of Landlord under this Lease. The terms of this Lease shall
not be affected by any of the above, and Tenant agrees to attorn to the
successor in interest of Landlord or such owner.
32. NOTICES. All notices, demands or requests, which are required to be
given by either party to the other hereunder shall be in writing, delivered
personally or by depositing the same in the United States certified or
registered mail. postage prepaid, and addressed: (i) to Tenant at the Premises,
and (ii) to Landlord at 000 Xxxxxx Xxxxxx, Xxxxx 000, Xxxx Xxxx, XX 00000 or
such other address as Landlord may from time to time notify Tenant. Each
notice, demand and request referred to in this Section shall be conclusively
deemed received by the party to whom it is addressed on the date of such
personal service or within three (3) calendar days after such mailing. The
parties shall have the right to make one address change a year and no more, and
said change of residence must remain a California address.
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33. ATTORNEYS' FEES. In the event that either party should bring suit for
the possession of the Premises, for the recovery of any sum due under this
Lease, or because of the breach of any provision of this Lease, or for any
other relief against the other party hereunder, then all costs and expenses,
including reasonable attorneys' fees, incurred by the prevailing party therein
shall be paid by the other party.
34. HOLDING OVER. Any holding over by Tenant after expiration or other
termination of the term of this Lease shall only be with the express prior
written consent of Landlord delivered to Tenant and shall not constitute a
renewal or extension of the Lease or give Tenant any rights in or to the
Premises except as expressly provided in such written consent and this Lease.
Any holding over after the expiration or other termination of the term of this
Lease, with the express written consent of Landlord, shall be construed to be a
tenancy from month to month, on the same terms and conditions as herein
specified insofar as applicable except that the monthly Basic Rent shall be
increased to an amount equal to one hundred fifty (150%) percent of the monthly
Basic Rent payable during the last month of the Lease term.
35. GENERAL PROVISIONS.
A. Choice of Law; Severability. This Lease shall in all respects
be governed by, construed and enforced in accordance with the laws of the State
of California. If any provision(s) of this Lease (except for payment of rent)
shall be invalid, illegal or unenforceable for any reason whatsoever, all other
provisions hereof shall remain in full force and effect.
B. Time of Essence. Time is of the essence of this Lease and of
each and of all its provisions.
C. Interpretations. The language in all parts of this Lease shall
in all cases be construed as a whole according to its fair meaning, and not
strictly for or against either Landlord or Tenant. All parties hereto have
equally participated in the preparation of this Lease. The term "assign" shall
include the term "transfer." The Section headings of this Lease are for
convenience only, are not part of this Lease and shall have no effect upon the
construction or interpretation of any provision hereof. The plural shall
include the singular, and the singular the plural. One gender shall include
all genders. Each term and provision of this Lease performable by Tenant shall
be construed to be both a covenant and a condition for the exclusive benefit of
Landlord.
D. Entire Agreement & Amendments. This instrument, along with
any exhibits and schedules hereto, constitute the entire agreement between
Landlord and Tenant relative to the Premises. This agreement may be altered,
amended or revoked only by an instrument in writing signed by both Landlord and
Tenant. Landlord has made no commitments, representation(s) or warranties
whatsoever to Tenant (express or implied) except as may be expressly stated in
writing in this Lease instrument. Landlord and Tenant agree hereby that all
prior or contemporaneous oral agreements between the parties and their agents
or representatives relative to the Premises or the matters described in this
Agreement are merged in or revoked by this agreement.
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E. Definition of Terms.
(1) The term "Landlord" or any pronoun used in place
thereof includes the Landlord at the time and/or any successors and assigns of
Landlord.
(2) The term "Tenant" or any pronoun used in place
thereof includes individuals, firms, associations, partnerships and
corporations, and their and each of their respective heirs, executors,
administrators, successors and permitted assigns, according to the context
hereof; and all parties who constitute Tenant shall be jointly and severally
liable for all obligations of Tenant hereunder.
(3) The term "person" or "entity" includes individuals,
firms, associations, partnerships, agencies, unions, corporations and
governmental bodies.
(4) The term "Unavoidable Delays" shall mean any delays
caused by Acts of God, acts of public agency, labor disputes, fires,
embargoes, acts of contractors, acts of Tenant, strikes, war, insurrection,
utilities, governmental bodies, adverse weather, unavailable materials and any
delays beyond Landlord's reasonable control.
(5) The term "Section" shall include the term "paragraph."
F. Examination of Lease. Submission of this instrument for
examination or signature to Tenant does not constitute a commitment or option
for a lease, and this instrument shall not be legally binding until its full
execution by both Landlord and Tenant,
G. Corporate Authority. If Tenant is a corporation (or a
partnership), each individual executing this Lease on behalf of said
corporation (or partnership) represents and warrants that he is duly authorized
to execute and deliver this Lease on behalf of said corporation (or
partnership) in accordance with the by-laws of said corporation (or in
accordance with the partnership agreement) and that this Lease is binding upon
said corporation (or partnership) in accordance with its terms. If Tenant is a
corporation, Tenant shall, within thirty (30) days after execution of this
Lease, deliver to Landlord a certified copy of the resolution of the Board of
Directors of said corporation authorizing or ratifying the execution of this
Lease.
H. Waiver. The waiver by Landlord of any breach of any term,
covenant or condition herein contained shall not be deemed to be a waiver of
such term, covenant or condition or any subsequent breach of the same or any
other term, covenant or condition therein contained. The subsequent acceptance
of rent hereunder by Landlord shall not be deemed to be a waiver of any
preceding breach by Tenant of any term, covenant or condition of this Lease,
other than the failure of Tenant to pay the particular rent payment so
accepted, regardless of Landlord's knowledge of such preceding breach at the
time of acceptance of such rent. No custom or practice which may develop
between the parties hereto during the term hereof shall be deemed a waiver of,
or in any way affect, the right of either party to insist upon performance and
observance by the other party in strict accordance with the terms hereof.
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I. Recording. Neither Landlord nor Tenant shall record this
Lease nor a short form memorandum hereof without the written consent of the
other.
J. Remedies. Each party may exercise all available remedies
cumulatively, or in the alternative. All remedies herein conferred upon
Landlord or Tenant shall be deemed cumulative and no one remedy shall be
exclusive of any other remedy herein conferred or created by law.
K. Impounding. If required in writing by Landlord's Lender, then
along with each monthly rent payment during the Lease term and any renewals
thereof, Tenant shall pay to Landlord a sum equal to 1/12th of the annual real
property taxes, assessments and insurance which Landlord estimates are payable
by Tenant hereunder, or which Tenant was obligated to pay during the previous
fiscal year pursuant to the terms hereof.
L. Benefit of Counsel. The advice of legal counsel has been
sought and obtained by each of the parties hereto prior to entering into this
Agreement.
M. Binding Effect. The provisions of this Lease shall inure to
the benefit of and bind the heirs, executors, administrators, successors and
permitted assigns of the respective parties hereto.
N. Execution & Counterparts. This Lease shall be executed in
duplicate originals, with both parties signing and executing each original, or
each party signing a separate counterpart original and delivering the same to
the other party. If this Agreement is executed in counterpart originals, all
executed counterparts shall constitute the Agreement which shall be binding
upon all parties hereto, notwithstanding that the signatures of all parties do
not appear on the same signature page.
36. EXHIBITS & SCHEDULES. The following exhibits and schedules to this
Lease are hereby incorporated herein and by this reference made a part hereof:
A. Schedule 1 - Additional Sections. Sections 37 through 39
hereof, both inclusive.
B. Exhibit A. The Leased Premises.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the day
and year first above written.
LANDLORD: TENANT
XXXXX ROAD INVESTMENTS NO. 3, ASPEC TECHNOLOGY, INC.,
a partnership a California corporation
000 Xxxxxx Xxxxxx 000 X. Xxxxxx Xxxxxx
Xxxx Xxxx, XX 00000 Xxxxxxxxx, XX 00000
By: \c\ Xxxxxx X. Xxxxxx, Xx. By: \c\ Xxxxxx Dell'Oca
---------------------------- ----------------------------
Xxxxxx X. Xxxxxx, Xx. Xxxxxx Dell'Oca
Title: Managing Partner Title: President
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Schedule 1
Additional Sections
To Lease Agreement Dated As Of November 20, 1996
By and Between
XXXXX ROAD INVESTMENTS NO.3 (Landlord)
and
ASPEC TECHNOLOGY, INC. (Tenant)
37. IMPROVEMENTS. Landlord agrees to do and provide to that part of the
Premises formerly leased and occupied by Ando Corp. the following improvements
at Landlord's sole cost and expense, and as shown on Exhibit "A."
A. Paint all interior walls off-white.
B. Reconfigure the interior walls and doors substantially as
shown on Exhibit "A."
C. Remove all unnecessary existing interior improvements below
drop ceiling level which are not shown on Exhibit "A."
D. Redecorate the northwesterly bathrooms to include new paint,
existing ceramic floor tile, new vanities, and recessed
lighting.
E. Relocate the northwesterly coffee bar as shown on Exhibit "A."
F. Relocate all electrical plugs, light switches, and fluorescent
lighting as may be required by code for normal office use.
G. Relocate all HVAC supply and return ducts as may be required
by code for normal office use.
H. Install new VCT floor tile in all areas marked VCT on Exhibit
"A."
I. Install new xxxx carpet in all areas marked "Carpet" on
Exhibit "A."
J. Install new 4" xxxx base in all areas where new VCT and new
carpet will be installed.
K. Patch ceiling tiles as may be required by the above
improvements, and adjust drop ceiling height where necessary.
L. Reconfigure ceiling fire sprinklers as required by code.
Landlord's obligation to provide existing improvements and to provide the above
improvements is specifically subject to any changes or other requirements of or
imposed by all applicable governmental body(ies), agency(ies) and/or
utility(ies) with respect to the same. Except for the above improvements, the
Premises is leased to Tenant in "As Is" condition, and any improvements to the
Premises not expressly shown or stated in this Lease to be furnished by
Landlord shall be made by Tenant at its sole cost and expense. Landlord does
not guarantee the accuracy of any Plans or Specifications supplied to Tenant.
If upon substantial completion of such interior improvements such improvements
do not conform exactly to such Plans and Specifications, but the general
appearance, structural integrity and Tenant's use and occupancy of the
Premises, Building and such improvements are not materially or unreasonably
affected by such deviation(s), it is agreed that the Tenant's obligation to pay
rent hereunder shall not be affected by such deviation(s), and in such event
Tenant agrees to accept the Premises, Building and such improvements as so
improved
26
by Landlord. Landlord acting with due diligence shall have thirty (30) days
after such substantial completion and occupancy of the Premises by Tenant in
which lo correct Tenant's reasonably requested 'punch list."
38. FIRST RIGHTS OF REFUSAL. Provided that Tenant is not in default of
any of the terms and conditions of this Lease Agreement, Tenant shall have the
First Right of Refusal to expand into the adjacent approximate 9,000 sq. ft. of
space currently leased to Presidio Systems, Inc. and located at 000 X. Xxxxxx
Xxxxxx, Xxxxxxxxx, Xxxxxxxxxx (hereinafter referred to as "Expansion Space
#1"), upon the following terms and conditions:
Landlord agrees that in the event such Expansion Space #1 becomes
vacant and thereafter is proposed to be leased to a third party (other than
Presidio Systems, Inc.) that prior to executing a lease agreement with such
third party for said Expansion Space #1. Landlord shall offer said Expansion
Space #1 to Tenant in then "As Is" condition at the highest of the following
rents: (i) the rental which Landlord proposed to lease such Expansion Space #1
to such third party, (ii) the monthly rental payable by Tenant hereunder for
the remainder of the Lease Term, or (iii) the then market rent for such space.
Tenant shall have five (5) calendar days after receipt of written notice from
Landlord of such proposed lease to such third party in which to execute a lease
for the Expansion Space #1 in accordance with such highest rent and the
remaining terms and conditions of this Lease. In the event that Tenant fails
to so execute such a lease after receipt of such notice from Landlord, then all
rights under this paragraph shall terminate and become void.
Provided that Tenant is not in default of any of the terms and
conditions of this Lease Agreement, Tenant shall have the First Right of
Refusal to expand into the adjacent approximate 10,500 sq. ft. of space
currently leased to Computer Plus, Inc. and located at 000 Xxxxx Xxx Xxxxx,
Xxxxxxxxx, Xxxxxxxxxx (hereinafter referred to as 'Expansion Space #2"), upon
the following terms and conditions:
Landlord agrees that in the event such Expansion Space #2 becomes
vacant and thereafter is proposed to be leased to a third party (other than
Computer Plus, Inc.) that prior to executing a lease agreement with such third
party for said Expansion Space #2. Landlord shall offer said Expansion Space
#2 to Tenant in then "As Is" condition at the highest of the following rents:
(i) the rental which Landlord proposed to lease such Expansion Space #2 to such
third party, (ii) the monthly rental payable by Tenant hereunder for the
remainder of the Lease Term. or (iii) the then market rent for such space.
Tenant shall have five (5) calendar days after receipt of written notice from
Landlord of such proposed lease to such third party in which to execute a lease
for the Expansion Space #2 in accordance with such highest rent and the
remaining terms and conditions of this Lease. In the event that Tenant fails
to so execute such a lease after receipt of such notice from Landlord, then all
rights under this paragraph shall terminate and become void.
39. PRIOR LEASE SUPERSEDED. This Lease hereby supersedes the prior lease
between the parties, dated as of April 15, 1994, in its entirety. including
each and every term and condition thereof.
[Architectural diagram of property appears here.]
