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EXHIBIT 10.61
(California Net Lease with Stops
for Taxes and Insurance)
LEASE AGREEMENT
THIS LEASE AGREEMENT is made this 16 day of August, 1996 between SCI
Limited Partnership-1, a Delaware Limited Partnership ("Landlord"), and the
Tenant named below.
Tenant: SteriGenics International, a California
Corporation
Tenant's representative, ▇▇▇▇▇ ▇▇▇▇▇▇▇
address, and phone no.: President and CEO
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone ▇▇▇-▇▇▇-▇▇▇▇ or 800/777-9012
Fax 510/▇▇▇-▇▇▇▇
Premises: That Building, containing approximately 24,250
rentable square feet, as determined by Landlord,
as shown on Exhibit A. The common address of which
is ▇▇▇▇-▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
Project: Hayward Industrial Center
Building: Building #12(#13612A)
Tenant's Proportionate Share 3.2%
of Project:
Tenant's Proportionate Share 100%
of Building:
Lease Term: Beginning on the Commencement Date and ending on
the last day of the 60th full calendar month
thereafter.
Commencement Date: September 1, 1996
Initial Monthly Base Rent: $13,338
Initial Estimated Monthly 1. Utilities: $150
Operating Expense Payments:
(estimates only and subject to 2. Common Area Charges: $465
adjustment to actual costs and
expense according to the provisions 3. Others: $90
of this Lease)
Initial Total Estimated Monthly
Operating Expense Payments: $705
Initial Total Monthly Base Rent and
Operating Expense Payments: $14,043
Base Year: Taxes: July 1, 1996 - June 30, 1997
Insurance: December 1, 1995 - November 30, 1996
Security Deposit: $14,043
Broker: None
Addenda: Exhibits A, B, C and Addendums 1,2,3 and 4
1. GRANTING CLAUSE. In consideration of the obligation of Tenant to pay
rent as herein provided and in consideration of the other terms, covenants, and
conditions hereof, Landlord leases to Tenant, and Tenant takes from Landlord,
the Premises, to have and to hold for the Lease Term, subject to the terms,
covenants and conditions of this Lease.
2. ACCEPTANCE OF PREMISES. Tenant shall accept the obligation in its
condition as of the Commencement Date, subject to all applicable laws,
ordinances, regulations, covenants and restrictions. Landlord has made no
representation or warranty as to the suitability of the Premises for the conduct
of Tenant's business, and Tenant waives any implied warranty that the Premises
are suitable for Tenant's intended purposes. Except as provided in Paragraph 10,
in no event shall Landlord have any obligation for any defects in the Premises
or any limitation on its use. The taking of possession of the Premises shall be
conclusive evidence that Tenant accepts the Premises and that the Premises were
in good condition at the time possession was taken except for items that are
Landlord's responsibility under Paragraph 10 and any punchlist items agreed to
in writing by Landlord and Tenant.
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3. USE. The Premises shall be used only for the purpose of receiving,
storing, shipping and selling (but limited to wholesale sales) products,
material and merchandise made and/or distributed by Tenant and for such other
lawful purposes as may be incidental thereto; provided, however, with Landlord's
prior written consent, Tenant may also use the Premises for light manufacturing.
Tenant shall not conduct or give notice of any auction, liquidation, or going
out of business sale on the Premises. Tenant will use the Premises in a careful,
safe and proper manner and will not commit waste thereon, overload the floor or
structure of the Premises or subject the Premises to use that would damage the
Premises. Tenant shall not permit any objectionable or unpleasant odors, smoke,
dust, gas, noise, or vibrations to emanate from the Premises or take any other
action that would constitute a nuisance or would disturb, unreasonably interfere
with, or endanger Landlord or any other tenants of the Project. Outside storage,
including without limitation, storage of trucks and other vehicles, is
prohibited without Landlord's prior written consent. Tenant, at its sole
expense, shall use and occupy the Premises in compliance with all laws,
including, without limitation, the Americans With Disabilities Act, orders,
judgments, ordinances, regulations, codes, directives, permits, licenses,
covenants and restrictions now or hereafter applicable to the Premises
(collectively, "Legal Requirements"). Tenant shall, at its expense, make any
alterations or modifications, within or without the Premises, that are required
by Legal Requirements related to Tenant's particular use or occupation of the
Premises. Subject to the immediately preceding sentence, but notwithstanding any
other provision hereof to the contrary, Landlord and not Tenant shall be
responsible for complying with Legal Requirements (including performing
alterations or modifications necessary to make the Premises comply with
applicable Legal Requirements) to the extent such compliance (i) relates to
structural components of the Building and the Project or to the exterior of the
Building, or (ii) is mandated generally for commercial and industrial properties
in the City of Hayward and is not the result of Tenant's particular use of the
Premises. The cost of any capital expenditures incurred by Landlord to comply
with applicable Legal Requirements (including the cost of any required
additions, alterations or modifications) under the immediately preceding
sentence shall be amortized as provided in Paragraph 6 below. Tenant shall pay
its Proportionate Share of such amortized costs over the remaining term of the
Lease as provided in Paragraph 6 below. Tenant shall not be responsible for any
costs attributable to maintaining compliance with Legal Requirements to the
extent such compliance is necessitated by the particular use of lessees of the
Project other than Tenant. Tenant will not use or permit the Premises to be used
for any purpose or in any manner that would void Tenant's or Landlord's
insurance, increase the insurance risk, or cause the disallowance of any
sprinkler credits. If any increase in the cost of any insurance on the Premises
or the Project is caused by Tenant's use or occupation of the Promises, or
because Tenant vacates the Premises, then Tenant shall pay the amount of such
increase to Landlord. Any occupation of the Premises by Tenant prior to the
Commencement Date shall be subject to all obligations of Tenant under this
Lease.
4. BASE RENT. Tenant shall pay Base Rent in the amount set forth above.
The first month's Base Rent, the Security Deposit, and the first monthly
installment of estimated Operating Expenses (as hereafter defined) shall be due
and payable on the date hereof, and Tenant promise to pay to Landlord in
advance, without demand, deduction or set-off, monthly installments of Base Rent
on or before the first day of each calendar month succeeding the Commencement
Date. Payments of Base Rent for any fractional calendar month shall be prorated.
All payments required to be made by Tenant to Landlord hereunder shall be
payable at such address as Landlord may specify from time to time by written
notice delivered in accordance herewith. The obligation of Tenant to pay Base
Rent and other sums to Landlord and the obligations of Landlord under this Lease
are independent obligations. Tenant shall have no right at any time to ▇▇▇▇▇,
reduce, or set-off any rent due hereunder except as may be expressly provided in
this Lease.
If Tenant is delinquent in any monthly installment of Base Rent or of estimated
Operating Expenses for more than 5 days after written notice (provided that
Landlord shall not be required to provide notice of monetary default more than
twice in any 12 month period or more than four (4) times during the term of the
Lease, as it may be extended), Tenant shall pay to Landlord on demand a late
charge equal to 5 percent of such delinquent sum. The provision for such late
charge shall be in addition to all of Landlord's other rights and remedies
hereunder or at law and shall not be construed as a penalty.
5. SECURITY DEPOSIT. The Security Deposit shall be held by Landlord as
security for the performance of Tenant's obligations under this Lease. The
Security Deposit is not an advance rental deposit or a measure of Landlord's
damages in case of Tenant's default. Upon each occurrence of an Event of Default
(hereinafter defined), Landlord may use all or part of the Security Deposit to
pay delinquent payments due under this Lease, and the cost of any damage injury,
expense or liability caused by such Event of Default, without prejudice to any
other remedy provided herein or provided by law. Tenant shall pay Landlord on
demand the amount that will restore the Security Deposit to its original amount.
Landlord's obligation respecting the Security Deposit is that of a debtor, not a
trustee; no interest shall accrue thereon. The Security Deposit shall be the
property of Landlord, but shall be paid to Tenant when Tenant's obligations
under this Lease have been completely fulfilled. Landlord shall be released from
any obligation with respect to the Security Deposit upon transfer of this Lease
and the Premises to a person or entity assuming Landlord's obligations under
this Paragraph 5.
6. OPERATING EXPENSE PAYMENTS. During each month of the Lease Term, on
the same date that Base Rent is due, Tenant shall pay Landlord an amount equal
to 1/12 of the annual cost, as estimated by Landlord from time to time, of
Tenant's Proportionate Share (hereinafter defined) of Operating Expenses for the
Project. Payments thereof for any fractional calendar month shall be prorated.
The term "Operating Expenses" means all costs and expenses incurred by Landlord
with respect to the ownership, maintenance, and operation of the Project
including, but not limited to costs of: utilities; maintenance, repair and
replacement of all portions of the Project, including without limitation, paving
and parking areas, roads, roofs, alleys, and driveways, mowing, landscaping,
exterior painting, utility lines, heating, ventilation and air conditioning
systems, lighting, electrical systems and other mechanical and building systems;
amounts paid to contractors and subcontractors for work or services performed in
connection with any of the foregoing; charges paid to contractors and
subcontractors for work or services performed in connection with any of the
foregoing; charges or assessments of any association to which the Project is
subject; fees payable to tax consultants and attorneys for
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or assessments of any association to which the Project is subject; fees payable
to tax consultants and attorneys for consultation and contesting taxes; property
management fees payable to a property manager, including any affiliate of
Landlord, or if there is no property manager, an administration fee of 15
percent of Operating Expenses payable to Landlord; security services, if any;
trash collection, sweeping and removal; and additions or alterations made by
Landlord to the Project or the Building in order to comply with Legal
Requirements (other than those expressly required herein to be made by Tenant)
or that are appropriate to the continued operation of the Project or the
Building as a bulk warehouse facility in the market area, provided that the cost
of such additions or alterations that are required to be capitalized for federal
income tax purposes shall be amortized on a straight line basis over a period
equal to the lesser of the useful life thereof for federal income tax purposes
or 10 years. In addition, Operating Expenses shall include (i) the amount by
which Taxes (hereinafter defined) for each calendar year during the Lease term
exceeds Taxes for the Base Year, and (ii) the amount by which the cost of
insurance maintained by Landlord for the Project for each calendar year during
the Lease term exceeds the cost of such insurance for the Base Year. Operating
Expenses do not include costs, or expenses, or depreciation or amortization for
capital repairs and capital replacements required to be made by Landlord under
Paragraph 10 of this Lease, debt service under mortgages or ground rent under
ground leases, costs of restoration to the extent of net insurance proceeds
received by Landlord with respect thereto, leasing commissions, or the costs of
renovating space for tenants.
If Tenant's total payments of Operating Expenses for any year
are less than Tenant's Proportionate Share of actual Operating Expenses for such
year, then Tenant shall pay the difference to Landlord within 30 days after
demand, and if more, then Landlord shall retain such excess and credit it
against Tenant's next payments. For purposes of calculating Tenant's
Proportionate Share of Operating Expenses, a year shall mean a calendar year
except the first year, which shall begin on the Commencement Date, and the last
year, which shall end on the expiration of this Lease. With respect to Operating
Expenses which Landlord allocates to the entire Project, Tenant's "Proportionate
Share" shall be the percentage set forth on the first page of this Lease as
Tenant's Proportionate Share of the Project as reasonably adjusted by Landlord
in the future for changes in the physical size of the Premises or Project; and,
with respect to Operating Expenses which Landlord allocates only to the
Building, Tenant's "Proportionate Share" shall be the percentage set forth on
the first page of this Lease as Tenant's Proportionate Share of the Building as
reasonably adjusted by Landlord in the future for changes in the physical size
of the Premises or the Building. Landlord may equitably increase Tenant's
Proportionate Share for any item of expense or cost reimbursable by Tenant that
relates to a repair, replacement, or service that benefits only the Premises or
only a portion of to Project or Building that includes the Premises or that
varies with occupancy or use. The estimated Operating Expenses for the Premises
set forth on the first Page of this Lease are only estimates, and Landlord makes
no guaranty or warranty that such estimates will be accurate.
7. UTILITIES. Tenant shall pay for all water, gas, electricity, heat,
light, power, telephone, sewer, sprinkler services, refuse and trash collection,
and other utilities and services used on the Premises, all maintenance charges
for utilities, and any storm sewer charges or other similar charges for
utilities imposed by any governmental entity or utility provider, together with
any taxes, penalties, surcharges or the like pertaining to Tenant's use of the
Premises. Landlord may cause at Tenant's expense any utilities to be separately
metered or charged directly to Tenant by the provider. Tenant shall pay its
share of all charges for jointly metered utilities based upon consumption, as
reasonably determined by Landlord. No interruption or failure of utilities shall
result in the termination of this Lease or the abatement of rent. Tenant agrees
to limit use of water and sewer for normal restroom use.
8. TAXES. Landlord shall pay all taxes, assessments and governmental
charges (collectively referred to as "Taxes") that accrue against the Project
during the Lease Term, Landlord may contest by appropriate legal proceedings the
amount, validity, or application of any Taxes or liens thereof. All capital
levies or other taxes assessed or imposed on Landlord upon the rents payable to
Landlord under this Lease and any franchise tax, any excise, transaction, sales
or privilege tax, assessment levy or charge measured by or based, in whole or in
part, upon such rents from the Premises and/or the Project or any portion
thereof shall be paid by Tenant to Landlord monthly in estimated installments or
upon demand, at the option of Landlord, as additional rent; provided, however,
in no event shall Tenant be liable for any net income taxes imposed on Landlord
unless such net income taxes are in substitution for any Taxes payable
hereunder. If any such tax or excise is levied or assessed directly against
Tenant, then Tenant shall be responsible for and shall pay the same at such
times and in such manner as the taxing authority shall require. Tenant shall be
liable for all taxes levied or assessed against any personal property or
fixtures placed in the Premises, whether levied or assessed against Landlord or
Tenant.
9. INSURANCE. Landlord shall maintain all risk property insurance
covering the full replacement cost of the Building. Landlord may, but is not
obligated to, maintain such other insurance and additional coverages as it may
deem necessary, including, but not limited to, commercial liability insurance
and rent loss insurance. All such insurance shall be included as part of the
Operating Expenses charged to Tenant. The Project or Building may be included in
a blanket policy (in which case the cost of such insurance allocable to the
Project or Building will be determined by Landlord based upon the insurer's cost
calculations). Tenant shall also reimburse Landlord for any increased premiums
or additional insurance which Landlord deems reasonably necessary as a result of
Tenant's use of the Premises.
Tenant, at its expense, shall maintain during the Lease Term:
all risk property insurance covering the full replacement cost of all property
and improvements, installed or placed in the Premises by Tenant at Tenant's
expense; worker's compensation insurance with no less than the minimum limits
required by law; employer's liability insurance with such limits as required by
law; and commercial liability insurance, with a minimum limit of $1,000,000 per
occurrence and a minimum umbrella limit of $1,000,000, for a total minimum
combined general liability and umbrella limit of $2,000,000 (together with such
additional umbrella coverage as Landlord may reasonably require) for property
damage, personal injuries, or deaths of persons occurring in or about the
Premises. Landlord may from time to time require reasonable increases in any
such limits. The commercial liability policies shall name Landlord as an
additional insured, insure on an occurrence and not a claims-made basis, be
issued by insurance companies which are reasonably acceptable to Landlord, not
be cancelable unless 30 days prior written notice shall have been given to
Landlord, contain
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a hostile fire endorsement and a contractual liability endorsement and provide
primary coverage to Landlord (any policy issued to Landlord providing duplicate
or similar coverage shall be deemed excess over Tenant's policies). Such
policies or certificates thereof shall be delivered to Landlord by Tenant upon
commencement of the Lease Term and upon each renewal of said insurance.
The all risk property insurance obtained by Landlord and
Tenant shall include a waiver of subrogation by the insurers and all rights
based upon an assignment from its insured, against Landlord or Tenant, their
officers, directors, employees, managers, agents, invitees and contractors, in
connection with any loss or damage thereby insured against. Neither party nor
its officers, directors, employees, managers, agents, invitees or contractors
shall be liable to the other for loss or damage caused by any risk coverable by
all risk property insurance, and each party waives any claims against the other
party, and its officers, directors, employees, managers, agents, invitees and
contractors for such loss or damage. The failure of a party to insure its
property shall not void this waiver. Landlord and its agents, employees and
contractors shall not be liable for, and Tenant hereby waives all claims against
such parties for, business interruption and losses occasioned thereby sustained
by Tenant or any person claiming through Tenant resulting from any accident or
occurrence in or upon the Premises or the Project from any cause whatsoever,
including without limitation, damage caused in whole or in part, directly or
indirectly, by the negligence of Landlord or its agents, employees or
contractors.
10. LANDLORD'S REPAIRS. Landlord shall maintain, at its expense, the
structural soundness of the roof, foundation, and exterior walls of the Building
in good repair, reasonable wear and tear and uninsured losses and damages caused
by Tenant its agents and contractors excluded. The term "walls" as used In this
Paragraph 10 shall not include windows, glass or plate glass, doors or overhead
doors, special store fronts, dock bumpers, dock plates or levelers, or office
entries. Tenant shall promptly give Landlord written notice of any repair
required by Landlord pursuant to this Paragraph 10, after which Landlord shall
have a reasonable opportunity to repair.
11. TENANT'S REPAIRS. Landlord, at Tenant's expense as provided in
Paragraph 6, shall maintain in good repair and condition the parking areas and
other common areas of the Building, including, but not limited to driveways,
alleys, landscape and grounds surrounding the Premises. Subject to Landlord's
obligation in Paragraph 10 and subject to Paragraph 9 and 15, Tenant, at its
expense, shall repair replace and maintain in good condition all portions of the
Premises and all areas, improvements and systems exclusively serving the
Premises including, without limitation, dock and loading areas, truck doors,
plumbing, water, and sewer lines up to points of common connection, fire
sprinklers and fire protection systems, entries, doors, ceilings and roof
membrane, windows, interior walls, and the interior side of demising walls, and
heating, ventilation and air conditioning systems. Such repair and replacements
include capital expenditures and repairs whose benefit may extend beyond the
Term. Heating, ventilation and air conditioning systems and other mechanical and
building systems serving the Premises shall be maintained at Tenant's expense
pursuant to maintenance service contracts entered into by, Tenant or, at
Landlord's election, by Landlord. The scope of services and contractors under
such maintenance contracts shall be reasonably approved by Landlord. At
Landlord's request, Tenant shall enter into a joint maintenance agreement with
any railroad that services the Premises. If Tenant fails to perform any repair
or replacement for which it is responsible, Landlord may perform such work and
be reimbursed by Tenant within 10 days after demand therefor. Subject to
Paragraphs 9 and 15, Tenant shall bear full cost of any repair or replacement to
any part of the Building or Project that results from damage caused by Tenant,
its agents, contractors, or invitees and any repair that benefits only the
premises.
12. TENANT-MADE ALTERATIONS AND TRADE FIXTURES. Any alterations,
additions, or improvements made by or on behalf of Tenant to the Premises
("Tenant-Made Alterations") shall be subject to Landlord's prior written consent
which shall not be unreasonably withheld provided that such Tenant-Made
Alterations do not effect the structure or mechanical components of the building
or ▇▇▇▇▇▇ the roof of the building. Tenant-Made Alterations shall cause, at its
expense, all Tenant-Made Alterations to comply with insurance requirements and
with Legal Requirements and shall construct at its expense any alteration or
modification required by Legal Requirements as a result of any Tenant-Made
Alterations. All Tenant-Made Alterations shall be constructed in a good and
workmanlike manner by contractors reasonably acceptable to Landlord and only
good grades of materials shall be used. All plans and specifications for any
Tenant-Made Alterations shall be submitted to landlord for its approval.
Landlord may monitor construction of the Tenant-Made Alterations. Tenant shall
reimburse Landlord for its costs in reviewing plans and specifications and in
monitoring construction. Landlord's right to review plans and specifications and
to monitor construction shall be solely for its own benefit, and Landlord shall
have no duty to see that such plans and specifications or construction comply
with applicable laws, codes, rules and regulations. Tenant shall provide
Landlord with the identities and mailing addressees of all persons performing
work or supplying materials, prior to beginning such construction, and Landlord
may post on and about the Premises notices of non-responsibility pursuant to
applicable law. Tenant shall furnish security or make other arrangements
satisfactory to Landlord to assure payment for the completion of all work free
and clear of liens and shall provide certificates of insurance for worker's
compensation and other coverage in amounts and from an insurance company
satisfactory to Landlord protecting Landlord against liability for personal
injury or property damage during construction. Upon completion of any
Tenant-Made Alterations, Tenant shall deliver to Landlord sworn statements
setting forth the names of all contractors and subcontractors who did work on
the Tenant-Made Alterations and final lien waivers from all such contractors and
subcontractors. Upon surrender of the Premises, all Tenant-Made Alterations and
any leasehold improvements constructed by Landlord or Tenant shall remain on the
Premises as Landlord's property, except to the extent Landlord's requires
removal at Tenant's expense of any such items or Landlord and Tenant have
otherwise agreed in writing in connection with Landlord's consent to any
Tenant-Made Alterations. Tenant shall repair any damage caused by such removal.
Tenant, at its own cost and expense and without Landlord's
prior approval, may erect such shelves, bins, machines and trade fixtures
(collectively "Trade Fixtures") in the ordinary course of its business provided
that such items do not alter the basic character of the Premises, do not
overload or damage the Premises, and may be removed without injury to the
Premises, and the construction, erection, and installation thereof complies with
all Legal
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Requirements and with landlord's requirements set forth above. Tenant shall
remove its Trade Fixtures and shall repair any damage caused by such removal.
13. SIGNS. Tenant shall not make any changes to the exterior of the
Premises, install any exterior lights, decorations, balloons, flags, pennants,
banners, or painting, or erect or install any signs, windows or door lettering,
placards, decorations, or advertising media of any type which can be viewed from
the exterior of the Premises, without Landlord's prior written consent. Upon
surrender or vacation of the Premises, Tenant shall have removed all signs and
repair, paint, and/or replace the building facia surface to which its signs are
attached. Tenant shall obtain all applicable governmental permits and approvals
for sign and exterior treatments. All signs, decorations, advertising media,
blinds, draperies and other window treatment or bars or other security
installations visible from outside the Premises shall be subject to Landlord's
approval and conform in all respects to Landlord's requirements.
14. PARKING. Tenant shall be entitled to park in common with other
tenants of the Project in those areas designated for nonreserved parking.
Landlord may allocate parking spaces among Tenant and other tenants in the
Project if Landlord determines that such parking facilities are becoming
crowded. Landlord shall not be responsible for enforcing Tenant's parking rights
against any third parties.
15. RESTORATION. If at any time during the Lease Term the Premises are
damaged by a fire or other casualty, Landlord shall notify Tenant within 45 days
after such damage as to the amount of time Landlord reasonably estimates it will
take to restore the Premises. If the restoration time is estimated to exceed 6
months, either Landlord or Tenant may elect to terminate this Lease upon notice
to the other party given no later than 30 days after Landlord's notice. If
neither party elects to terminate this Lease or if Landlord estimates that
restoration will ▇▇▇▇ ▇ months or less, then, subject to receipt of sufficient
insurance proceeds, Landlord shall promptly restore the Premises excluding the
improvements installed by Tenant or by Landlord and paid by Tenant, subject to
delays arising from the collection of insurance proceeds or from Force Majeure
events. Tenant at Tenant's expense shall promptly perform, subject to delays
arising from the collection of insurance proceeds, or from Force Majeure events,
all repairs or restoration not required to be done by Landlord and shall
promptly re-enter the Premises and commence doing business in accordance with
this Lease. Notwithstanding the foregoing, either party may terminate this Lease
if the Premises are damaged during the last year of the Lease Term and Landlord
reasonably estimates that it will take more than one month to repair such
damage. Tenant shall pay to Landlord with respect to any damage to the Promises
the amount of the commercially reasonable deductible under Landlord's insurance
policy (currently $10,000) within 10 days after presentment of Landlord's
invoice. If the damage involves the premises of other tenants, Tenant shall pay
the portion of the deductible that the cost of the restoration of the Premises
bears to the total cost of restoration, as determined by Landlord. Base Rent and
Operating Expenses shall be abated for the period of repair and restoration in
the proportion which the area of the Premises, if any, which is not usable by
Tenant bears to the total area of the Premises. Such abatement shall be the sole
remedy of Tenant, and except as provided herein, Tenant waives any right to
terminate the Lease by reason of damage or casualty loss.
16. CONDEMNATION. If any part of the Premises or the Project should be
taken for any public or quasi-public use under governmental law, ordinance, or
regulation, or by right of eminent domain, or by private purchase in lieu
thereof (a "Taking" or "Taken"), and the Taking would prevent or materially
interfere with Tenant's use of the Premises or in Landlord's judgment would
materially interfere with or impair its ownership or operation of the Project,
then upon written notice by either party this Lease shall terminate and Base
Rent shall be apportioned as of said date. If part of the Premises shall be
Taken, and this Lease is not terminated as provided above, the Base Rent payable
hereunder during the unexpired Lease Term shall be reduced to such extent as may
be fair and reasonable under the circumstance. In the event of any such Taking,
Landlord shall be entitled to receive the entire price or award from any such
Taking without any payment to Tenant, and Tenant hereby assigns to Landlord
Tenant's interest, if any, in such award. Tenant shall have the right, to the
extent that same shall not diminish Landlord's award, to make a separate claim
against the condemning authority (but not Landlord) for such compensation as may
be separately awarded or recoverable by Tenant for moving expenses and damage to
Tenant's Trade Fixtures, if a separate award for such items is made to Tenant.
17. ASSIGNMENT AND SUBLETTING. Without Landlord's prior written
consent, which landlord shall not unreasonably withhold, Tenant shall not assign
this Lease or sublease the Premises or any part thereof or mortgage, pledge; or
hypothecate its leasehold interest or grant any concession or license within the
Premises and any attempt to do any of the foregoing shall be void and of no
effect. For purposes of this paragraph, a transfer of the ownership interests
controlling Tenant shall be deemed an assignment of this Lease unless such
ownership interests are publicly traded. Notwithstanding the above, Tenant may
assign or sublet the Premises, or any part thereof, to any entity controlling
Tenant, controlled by Tenant or under common control with Tenant (a "Tenant
Affiliate"), without the prior written consent of Landlord. Tenant shall
reimburse Landlord for all of Landlord's reasonable out-of-pocket expenses in
connection with any assignment or sublease. Upon Landlord's receipt of Tenant's
written notice of a desire to assign or sublet a minimum of 75% of the Premises,
(other than to a Tenant Affiliate), Landlord may, by giving written notice to
Tenant within 30 days after receipt of Tenant's notice, terminate this Lease
with respect to the space described in Tenant's notice, as of the date specified
in Tenant's notice for the commencement of the proposed assignment or sublease.
If Landlord so terminates the Lease, Landlord may enter into a lease directly
with the proposed sublessee or assignee. Tenant may withdraw its notice to
sublease or assign by notifying Landlord within 10 days after Landlord has given
Tenant notice of such termination, in which case the Lease shall not terminate
but shall continue.
It shall be reasonable for the Landlord to withhold its
consent to any assignment or sublease in any of the following instances: (i) an
Event of Default has occurred and is continuing that would not be cured upon the
proposed sublease or assignment; (ii) the assignee or subleasee does not have a
net worth calculated according to generally accepted accounting principles at
least equal to the greater of the net worth of Tenant immediately prior to such
assignment or sublease or the net worth of the Tenant at the time it executed
the Lease; (iii) the intended use of the Premises by the assignee or sublessee
is not reasonably satisfactory to Landlord; (iv) the intended use of the
Premises by the assignee or
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sublessee would materially increase the pedestrian or vehicular traffic to the
Premises or the Project; (v) occupancy of the Premises by the assignee or
sublessee would, in Landlord's opinion, violate an agreement binding upon
Landlord or the Project with regard to the identity of tenants, usage in the
Project, or similar matters; (vi) the identity or business reputation of the
assignee or sublessee will, in the good faith judgment of Landlord, tend to
damage the goodwill or reputation of the Project; (vii) the assignee or sublet
is to another tenant in the Project and is at rates which are below those
charged by Landlord for comparable space in the Project; (viii) in the case of a
sublease, the subtenant has not acknowledged that the Lease controls over any
inconsistent provision in the sublease; (ix) the proposed assignee or sublease
is a governmental agency; or (x) there is vacant space in the Premises suitable
for lease to the proposed sublessee or assignee. Tenant and Landlord acknowledge
that each of the foregoing criterion are reasonable as of the date of execution
of this Lease. The foregoing criteria shall not exclude any other reasonable
basis for Landlord to refuse its consent to such assignment or sublease. Any
approved assignment or sublease shall be expressly subject to the terms and
conditions of this Lease. Tenant shall provide to Landlord all information
concerning the assignee or sublessee as Landlord may request.
Notwithstanding any assignment or subletting, Tenant and any
guarantor or surety of Tenant's obligations under this Lease shall at all times
remain fully responsible and liable for the payment of the rent and for
compliance with all of Tenant's other obligations under this Lease (regardless
of whether Landlord's approval has been obtained for any such assignments or
subletting). In the event that the rent due and payable by a sublessee or
assignee (or a combination of the rental payable under such sublease or
assignment plus any bonus or other consideration therefor or incident thereto
exceeds the rental payable under this Lease, then Tenant shall be bound and
obligated to pay Landlord as additional rent hereunder all such excess rental
and other excess consideration within 10 days following receipt thereof by
Tenant.
If this Lease be assigned or if the Premises be subleased
(whether in whole or in part) or in the event of the mortgage, pledge, or
hypothecation of Tenant's leasehold interest or grant of any concession or
license within the Premises or if the Premises be occupied in whole or in part
by anyone other than Tenant, then upon a default by Tenant hereunder Landlord
may collect rent from the assignee, sublessee, mortgagee, pledgee, party to whom
the leasehold interest was hypothecated, concessionee or licensee or other
occupant and, except to the extent set forth in the preceding paragraph, apply
the amount collected to the next rent payable hereunder; and all such rentals
collected by Tenant shall be held in trust for Landlord and immediately
forwarded to Landlord. No such transaction or collection of rent or application
thereof by Landlord, however, shall be deemed a waiver of these provisions or a
release of Tenant from the further performance by Tenant of its covenants,
duties, or obligations hereunder.
18. INDEMNIFICATION. Except for the willful misconduct or negligence of
Landlord, its agents, employees or contractors, and to the extent permitted by
law, Tenant agrees to indemnify, defend and hold harmless Landlord, and
Landlord's agents, employees and contractors, from and against any and all
losses, liabilities, damages, costs and expenses (including attorneys' fees)
resulting from claims by third parties for injuries to any person and damage to
or theft or misappropriation or loss of property occurring in or about the
Project and arising from the use and occupancy of the Premises or from any
activity, work, or thing done, permitted or suffered by Tenant in or about the
Premises or due to any other act or omission of Tenant, its subtenants,
assignees, invitees, employees, contractors and agents. The furnishing of
insurance required hereunder shall not be deemed to limit Tenant's obligations
under this Paragraph 18.
19. INSPECTION AND ACCESS. Landlord and its agents, representatives,
and contractors may enter the Premises at any reasonable time with prior notice
(except in the case of emergency) to inspect the Premises and to make such
repairs as may be required or permitted pursuant to this Lease and for any other
business purpose. Landlord and Landlord's representatives may enter the Premises
during business hours for the purpose of showing the Premises to prospective
purchasers and, during the last year of the Lease Term, to prospective tenants.
Landlord may erect a suitable sign on the Premises stating the Premises are
available to let or that the Project is available for sale. Landlord may grant
easements, make public dedications, designate common areas and create
restrictions on or about the Premises, provided that no such easement,
dedication, designation or restriction materially interferes with Tenant's use
or occupancy of the Premises. At Landlord's request, Tenant shall execute such
instruments as my be necessary for such easements, dedications or restrictions.
20. QUIET ENJOYMENT. If Tenant shall perform all of the convenants and
agreements herein required to be performed by Tenant, Tenant shall, subject to
the terms of this Lease, at all times during the Lease Term, have peaceful and
quiet enjoyment of the Premises against any person claiming by, through or under
Landlord.
21. SURRENDER. Upon termination of the Lease Term or earlier
termination of Tenant's right of possession, Tenant shall surrender the Premises
to Landlord in the same condition as received, broom clean, ordinary wear and
tear and casualty loss and condemnation covered by Paragraphs 15 and 16
excepted. Any Trade Fixtures, Tenant-Made Alterations and property not so
removed by Tenant as permitted or required herein shall be deemed abandoned and
may be stored, removed, and disposed of by Landlord at Tenant's expense, and
Tenant waives all claims against Landlord for any damages resulting from
Landlord's retention and disposition of such property. All obligations of Tenant
hereunder not fully performed as of the termination of the Lease Term shall
survive the termination of the Lease Term, including without limitation,
indemnity obligations, payment obligations with respect to Operating Expenses
and all obligations concerning the condition and repair of the Premises.
22. HOLDING OVER. If Tenant retains possession of the Premises after
the termination of the Lease Term, unless otherwise agreed in writing, such
possession shall be subject to immediate termination by Landlord at any time,
and all of the other terms and provisions of this Lease (excluding any expansion
or renewal option or other similar right or option) shall be applicable during
such holdover period, except that Tenant shall Pay Landlord from time to time,
upon demand, as Base Rent for the holdover period, an amount equal to 150% of
the Base Rent in effect on the termination date, computed on a monthly basis for
each month or part thereof during such holding over. All other
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payments shall continue under the terms of this Lease. In addition, Tenant shall
be liable for all damages incurred by Landlord as a result of such holding over.
No holding over by Tenant, whether with or without consent of Landlord, shall
operate to extend this Lease except as otherwise expressly provided, and this
Paragraph 22 shall not be construed as consent for Tenant to retain possession
of the Premises.
23. EVENT OF DEFAULT. Each of the following events shall be an event of
default ("Event of Default") by Tenant under this Lease:
(i) Tenant shall fail to pay any installment of Base Rent or
any other payment required herein when due, and such failure shall
continue for a period of 5 days after written notice (provided that
Landlord shall not be required to provide notice of monetary default
more than twice in any 12 month period or more than four (4) times
during the term of this Lease, as it may be extended) from the date
such payment was due.
(ii) Tenant or any guarantor or surety of Tenant's obligations
hereunder shall (A) make a general assignment for the benefit of
creditors; (B) commence any case, proceeding or other action seeking to
have an order for relief entered on its behalf as a debtor or to
adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, liquidation, dissolution or composition of it
or its debts or seeking appointment of a receiver, trustee, custodian
or other similar official for it or for all or of any substantial part
of its property (collectively a "proceeding for relief"); (C) become
the subject of any proceeding for relief which is not dismissed within
60 days of its filing or entry; or (D) die or suffer a legal disability
(if Tenant, guarantor, or surety is an individual) or be dissolved or
otherwise fail to maintain its legal existence (if Tenant, guarantor or
surety is a corporation, partnership or other entity).
(iii) Any insurance required to be maintained by Tenant
pursuant to this Lease shall be cancelled or terminated or shall expire
or shall be reduced or materially changed, except, in each case, as
permitted in this Lease.
(iv) Tenant shall not occupy or shall vacate the Premises or
shall fail to continuously operate its business at the Premises for the
permitted use set forth herein, whether or not Tenant is in monetary or
other default under this Lease.
(v) Tenant shall attempt or there shall occur any assignment,
subleasing or other transfer of Tenant's interest in or with respect to
this lease except as otherwise permitted in this Lease.
(vi) Tenant shall fail to discharge any lien placed upon the
Premises in violation of this Lease within 30 days after any such lien
or encumbrance is filed against the Premises.
(vii) Tenant shall fail to comply with any provision of this
Lease other than those specifically referred to in this paragraph 23,
and except as otherwise expressly provided herein, such default shall
continue for more than 30 days after Landlord shall have given Tenant
written notice of such default or such longer period of time reasonably
required if Tenant is actively pursuing such default, but not to exceed
90 days.
24. LANDLORD'S REMEDIES. Upon each occurrence of an Event of Default
and so long as such Event of Default shall be continuing, Landlord may at any
time thereafter at its election: terminate this Lease; and/or pursue any other
remedies at law or in equity. Upon the termination of this Lease or termination
of Tenant's right of possession, it shall be lawful for Landlord, without formal
demand or notice of any kind, to re-enter the Promises by summary dispossession
proceedings or any other action or proceeding authorized by law and to remove
Tenant and all persons and property therefrom. If Landlord re-enters the
Premises, Landlord shall have the right to keep in place and use, or remove and
store, all of the furniture, fixtures and equipment at the Premises.
Except as otherwise provided in the next paragraph, if Tenant
breaches this Lease and abandons the Premises prior to the end of the term
hereof, or if Tenant's right to possession is terminated by Landlord because of
an Event of Default by Tenant under this Lease, this Lease shall terminate. Upon
such termination, Landlord may recover from Tenant the following, as provided in
Section 1951.2 of the Civil Code of California: (i) the worth at the time of
award of the unpaid Base Rent and other charges under this Lease that had been
earned at the time of termination; (ii) the worth at the time of award of the
amount by which the reasonable value of the unpaid Base Rent and other charges
under this Lease which would have been earned after termination until the time
of award exceeds the amount of such rental loss that Tenant proves could have
been reasonably avoided; (iii) the worth at the time of award by which the
reasonable value of the unpaid Base Rent and other charges under this Lease for
the balance of the term of this Lease after to time of award exceeds the amount
of such rental loss that Tenant proves could have been reasonably avoided; and
(iv) any other amount necessary to compensate Landlord for all the detriment
proximately caused by Tenant's failure to perform its obligations under this
Lease or that in the ordinary course of things would be likely to result
therefrom. As used herein, the following terms are defined: (a) the "worth at
the time of award" of the amounts referred to in Sections (i) and (ii) is
computed by allowing interest at the lesser of 18 percent per annum or the
maximum lawful rate. The "worth at the time of award" of the amount referred to
in Section (iii) is computed by discounting such amount at the discount rate of
the Federal Reserve Bank of San Francisco at the time of award plus one percent;
(b) The "time of award" as used in clauses (i), (ii) and (iii) above is the date
on which judgment is entered by a court of competent jurisdiction; (c) The
"reasonable value" of the amount referred to in clause (ii) above is computed by
determining the mathematical product of (1) the "reasonable annual rental value"
(as defined herein) and (2) the number of years, including fractional parts
thereof, between the date of termination and the time of award. The "reasonable
value" of the amount referred to in clause (iii) is computed by determining the
mathematical product of (1) the annual Base Rent and other
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charges under this Lease and (2) the number of years including fractional parts
thereof remaining in the balance of the term of this Lease after the time of
award.
Even though Tenant has breached this Lease and abandoned the
Premises, this Lease shall continue in effect for so long as Landlord does not
terminate Tenant's right to possession, and Landlord may enforce all its rights
and remedies under this Lease, including the right to recover rent as it becomes
due. This remedy is intended to be the remedy described in California Civil Code
Section 1951.4, and the following provision from such Civil Code Section is
hereby repeated: "The Lessor has the remedy described in California Civil Code
Section 1951.4 (lessor may continue lease in effect after lessee's breach and
abandonment and recover rent as it becomes due, if lessee has right to sublet or
assign, subject only to reasonable limitations)." Any such payments due Landlord
shall be made upon demand therefor from time to time and Tenant agrees that
Landlord may file suit to recover any sums falling due from time to time.
Notwithstanding any such reletting without termination, Landlord may at any time
thereafter elect in writing to terminate this Lease for such previous breach.
Exercise by Landlord of any one or more remedies hereunder
granted or otherwise available shall not be deemed to be an acceptance of
surrender of the Premises and/or a termination of this Lease by Landlord,
whether by agreement or by operation of law, it being understood that such
surrender and/or termination can be effected only by the written agreement of
Landlord and Tenant. Any law, usage, or custom to the contrary notwithstanding,
Landlord shall have the right at all times to enforce the provisions of this
Lease in strict accordance with the terms hereof; and the failure of Landlord at
any time to enforce its rights under this Lease strictly in accordance with same
shall not be construed as having created a custom in any way or manner contrary
to the specific terms, provisions, and covenants of this Lease or as having
modified the same. Tenant and Landlord further agree that forbearance or waiver
by Landlord to enforce its rights pursuant to this Lease or at law or in equity,
shall not be a waiver of Landlord's right to enforce one or more of its rights
in connection with any subsequent default. A receipt by Landlord of rent or
other payment with knowledge of the breach of any covenant hereof shall not be
deemed a waiver of such breach, and no waiver by Landlord of any provision of
this Lease shall be deemed to have been made unless expressed in writing and
signed by Landlord. To the greatest extent permitted by law, Tenant waives the
service of notice of Landlord's intention to re-enter as provided for in any
statute, or to institute legal proceedings to that end, and also waives all
right of redemption in case Tenant shall be dispossessed by a judgment or by
warrant of any court or judge. The terms "enter," "re-enter," "entry" or
"re-entry," as used in this Lease, are not restricted to their technical legal
meanings. Any reletting of the Premises shall be on such terms and conditions as
Landlord in its sole discretion may determine (including without limitation a
term different than the remaining Lease Term, rental concessions, alterations
and repair of the Premises, lease of less than the entire Premises to any tenant
and leasing any or all other portions of the Project before reletting the
Premises). Landlord shall not be liable, nor shall Tenants obligations hereunder
be diminished because of, Landlord's failure to relet the Premises or collect
rent due in respect of such reletting.
25. TENANT'S REMEDIES/LIMITATION OF LIABILITY. Landlord shall not be in
default hereunder unless Landlord fails to perform any of its obligations
hereunder within 30 days after written notice from Tenant specifying such
failure (unless such performance will, due to the nature of the obligation,
require a period of time in excess of 30 days, then after such period of time as
is reasonably necessary). All obligations of Landlord hereunder shall be
construed as covenants, not conditions; and, except as may be otherwise provided
in this Lease, Tenant may not terminate this Lease for breach of Landlord's
obligations hereunder. All such obligations of Landlord under this Lease will be
binding upon Landlord only during the period of its ownership of the Premises
and not thereafter. The term "Landlord" in this Lease shall mean only the owner,
for the time being of the Premises, and in the event of the transfer by such
owner of its interest in the Premises, such owner shall thereupon be released
and discharged from all obligations of Landlord thereafter accruing, but such
obligations shall be binding during the Lease Term upon each new owner for the
duration of such owner's ownership. Any liability of Landlord under this Lease
shall be limited solely to its interest in the Project, and in no event shall
any personal liability be asserted against Landlord in connection with this
Lease nor shall any recourse be had to any other property or assets of Landlord.
26. WAIVER OF JURY TRIAL. TENANT AND LANDLORD WAIVE ANY RIGHT TO TRIAL
BY JURY OR TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING
IN CONTRACT, TORT, OR OTHERWISE, BETWEEN LANDLORD AND TENANT ARISING OUT OF THIS
LEASE OR ANY OTHER INSTRUMENT, DOCUMENT, OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH OR THE TRANSACTIONS RELATED HERETO.
27. SUBORDINATION. This Lease and Tenant's interest and rights
hereunder are and shall be subject and subordinate at all times to the lien of
any first mortgage, now existing or hereafter created on or against the Project
or the Premises, and all amendments, restatements, renewals, modifications,
consolidations, refinancing, assignments and extensions thereof, without the
necessity of any further instrument or act on the part of Tenant. Tenant agrees,
at the election of the holder of any such mortgage, to attorn to any such
holder. Tenant agrees upon demand to execute, acknowledge and deliver such
instruments, confirming such subordination and such instruments of attornment as
shall be requested by any such holder. Tenant hereby appoints Landlord attorney
in fact for Tenant irrevocably (such power of attorney being coupled with an
interest) to execute, acknowledge and deliver any such instrument and
instruments for and in the name of the Tenant and to cause any such instrument
to be recorded. Notwithstanding the foregoing, any such holder may at any times
subordinate its mortgage to this Lease, without Tenant's consent, by notice in
writing to Tenant, and thereupon this Lease shall be deemed prior to such
mortgage without regard to their respective dates of execution, delivery or
recording and in that event such holder shall have the same rights with respect
to this Lease as though this Lease had been executed prior to the execution,
delivery and recording of such mortgage and had been assigned to such holder.
The term "mortgage" whenever used in this Lease shall be deemed to include deeds
of trust, security assignments and any other encumbrances, and any reference to
the "holder" of a mortgage shall be deemed to include the beneficiary under a
deed of trust.
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28. MECHANIC'S LIENS. Tenant has no express or implied authority to
create or place any lien or encumbrance of any kind upon, or in any manner to
bind the interest of Landlord or Tenant in, the Premises or to charge the
rentals payable hereunder for any claim in favor of any person dealing with
Tenant, including those who may furnish materials or perform labor for any
construction or repairs. Tenant covenants and agrees that it will pay or cause
to be paid all sums legally due and payable by it on account of any labor
performed or materials furnished in connection with any work performed on the
Premises and that it will save and hold Landlord harmless from all loss, cost or
expense based on or arising out of asserted claims or liens against the
leasehold estate or against the interest of Landlord in the Premises or under
this Lease. Tenant shall give Landlord immediate written notice of the placing
of any lien or encumbrance against the Premises and cause such lien or
encumbrance to be discharged within 30 days of the filing or recording thereof;
provided, however, Tenant may contest such liens or encumbrances as long as such
contest prevents foreclosure of the lien or encumbrance and Tenant causes such
lien or encumbrance to be bonded or insured over in a manner satisfactory to
Landlord within such 30 day period.
29. ESTOPPEL CERTIFICATES. Tenant agrees, from time to time, within 10
business days after request of Landlord, to execute and deliver to Landlord, or
Landlord's designee, any estoppel certificate reasonably requested by Landlord
stating that this Lease is in full force and effect, the date to which rent has
been paid, that Landlord is not in default hereunder (or specifying in detail
the nature of Landlord's default), the termination date of this Lease and such
other matters pertaining to this Lease as may be requested by Landlord. Tenant's
obligation to furnish each estoppel certificate in a timely fashion is a
material inducement for Landlord's execution of this Lease. No cure or grace
period provided in this Lease shall apply to Tenant's obligations to timely
deliver an estoppel certificate.
30. ENVIRONMENTAL REQUIREMENTS. Except for Hazardous Material contained
in products used by Tenant in de minimis quantities for ordinary cleaning and
office purposes, Tenant shall not permit or cause any party to bring any
Hazardous Material upon the Premises or transport, store, use, generate,
manufacture or release any Hazardous Material in or about the Premises without
Landlord's prior written consent. Tenant, at its sole cost and expense, shall
operate its business in the Premises in strict compliance with all Environmental
Requirements, and shall remediate in a matter satisfactory to Landlord any
Hazardous Materials released on or from the Project by Tenant, its agents,
employees, contractors, subtenants or invitees. Tenant shall complete and
certify to disclosure statements as requested by Landlord from time to time
relating to Tenant's transportation, storage, use, generation, manufacture, or
release of Hazardous Materials on the Premises. The term "Environmental
Requirements" means all applicable present and future statutes, regulations,
ordinances, rules, codes, judgments, orders or other similar enactments of any
governmental authority or agency regulating or relating to health, safety, or
environmental conditions on, under, or about the Premises or the environment,
including without limitation, the following: the Comprehensive Environmental
Response, Compensation and Liability Act; the Resource Conservation and Recovery
Act; and all state and local counterparts thereto, and any regulations or
policies promulgated or issued thereunder. The term "Hazardous Materials" means
and includes any substance, material, waste, pollutant, or contaminant listed or
defined as hazardous or toxic, under any Environmental Requirements, asbestos
and petroleum, including crude oil or any fraction thereof, natural gas, or
synthetic gas usable for fuel (or mixtures of natural gas and such synthetic
gas). As defined in Environmental Requirements, Tenant is and shall be deemed to
be the "operator" or Tenant's "facility" and the "owner" of all Hazardous
Materials brought on the Premises by Tenant, its agents, employees, contractors
or invitees, and the wastes, by-products, or residues generated, resulting, or
produced therefrom.
Tenant shall indemnify, defend, and hold Landlord harmless
from and against any and all losses (including, without limitation, diminution
in value of the Premises or the Project and loss of rental income from the
Project), claims, demands, actions, suits, damages (including, without
limitation, punitive damages), expenses (including, without limitation,
remediation, removal, repair, corrective action, or cleanup expenses), and costs
(including, without limitation, actual attorneys' fees, consultant fees or
expert fees and including, without limitation, removal or management of any
asbestos brought into the Premises by Tenant, its agents, employees, contractors
or invitees, or disturbed in breach of the requirements of this Paragraph 30,
regardless of whether such removal or management is required by law) which are
brought or recoverable against, or suffered or incurred by Landlord as a result
of any release of Hazardous Materials for which Tenant is obligated to remediate
as provided above or any other breach of the requirements under this Paragraph
30 by Tenant, its agents, employees, contractors, subtenants, assignees or
invitees, regardless of whether Tenant had knowledge of such noncompliance. The
obligations of Tenant under this Paragraph 30 shall survive any termination of
this Lease.
Landlord shall have access to, and a right to perform
inspections and tests of, the Premises to determine Tenant's compliance with
Environmental Requirements, its obligations under this Paragraph 30, or the
environmental condition of the Premises. Access shall be granted to Landlord
upon Landlord's prior notice to Tenant and at such times so as to minimize, so
far as may be reasonable under the circumstances, any disturbance to Tenant's
operations. Such inspections and tests shall be conducted at Landlord's expense,
unless such inspections or tests reveal that Tenant has not complied with any
Environmental Requirement, in which case Tenant shall reimburse Landlord for the
cost of such inspection and tests. Landlord's receipt of or satisfaction with
any environmental assessment in no way waives any rights that Landlord ▇▇▇▇▇
against Tenant.
31. RULES AND REGULATIONS. Tenant shall at all times during the Lease
Term and any extension thereof, comply with all reasonable rules and regulations
at any time or from time to time established by Landlord covering use of the
Premises and the Project. The current rules and regulations are attached hereto.
In the event of any conflict between said rules and regulations and other
provisions of this Lease, the other terms and provisions of this Lease shall
control. Landlord shall not have any liability or obligation for the breach of
any rules or regulations by other tenants in the Project.
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32. SECURITY SERVICE. Tenant acknowledges and agrees that, while
Landlord may patrol the Project, Landlord is not providing any security Services
with respect to the Premises and that Landlord shall not be liable to Tenant
for, and Tenant waives any claim against Landlord with respect to, any loss by
theft or any other damage suffered or incurred by Tenant in connection with any
unauthorized entry into the Premises or any other breach of security with
respect to the Premises.
31 FORCE MAJEURE. Landlord shall not be held responsible for delays in
the performance of its obligations hereunder when caused by strikes, lockouts,
labor disputes, acts of God, inability to obtain labor or materials or
reasonable substitutes therefor, governmental restrictions, governmental
regulations, governmental controls, delay in issuance of permits, enemy or
hostile governmental action, civil commotion, fire or other casualty, and other
causes beyond the reasonable control of Landlord ("Force Majeure").
34. ENTIRE AGREEMENT. This Lease constitutes the complete agreement of
Landlord and Tenant with respect to the subject matter hereof. No
representations, inducements, promises or agreements, oral or written, have been
made by Landlord or Tenant, or anyone acting on behalf of Landlord or Tenant,
which are not contained herein, and any prior agreements, promises,
negotiations, or representations are superseded by this Lease. This Lease may
not be amended except by an instrument in writing signed by both parties hereto.
35. SEVERABILITY. If any clause or provision of this Lease is illegal,
invalid or unenforceable under present or future laws, then and in that event,
it is the intention of the parties hereto that the remainder of this Lease shall
not be affected thereby. It is also the intention of the parties to this Lease
that in lieu of each clause or provision of this Lease that is illegal, invalid
or unenforceable, there be added, as a part of this Lease, a clause or provision
as similar in terms to such illegal, invalid or unenforceable clause or
provision as may be possible and be legal, valid and enforceable.
36. BROKERS. Tenant represents and warrants that it has dealt with no
broker, agent or other person in connection with this transaction and that no
broker, agent or other person brought about this transaction, other than the
broker, if any, set forth on the first page of this Lease, and Tenant agrees to
indemnify and hold Landlord harmless from and against any claims by any other
broker, agent or other person claiming a commission or other form of
compensation by virtue of having dealt with Tenant with regard to this leasing
transaction.
37. MISCELLANEOUS. (a) Any payments or charges due from Tenant to
Landlord hereunder shall be considered rent for all purposes of this Lease.
(b) If and when included within the term "Tenant," as used in this
instrument, there is more than one person, firm or corporation, each shall be
jointly and severally liable for the obligations of Tenant.
(c) All notices required or permitted to be given under this Lease
shall be in writing and shall be sent by registered or certified mail, return
receipt requested, or by a reputable national overnight courier service, postage
prepaid, or by hand delivery addressed to the parties at their addresses below,
and with a copy sent to Landlord at ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇. Either party may by notice given aforesaid change its address for all
subsequent notices. Except where otherwise expressly provided to the contrary,
notice shall be deemed given upon delivery.
(d) Except as otherwise expressly provided in this Lease or as
otherwise required by law, Landlord retains the absolute right to withhold any
consent or approval.
(e) At Landlord's request from time to time Tenant shall furnish
Landlord with true and complete copies of its most recent annual and quarterly
financial statements prepared by Tenant or Tenant's accountants any other
financial information or summaries that Tenant typically provides to its lenders
or shareholders.
(f) Neither this Lease nor a memorandum of lease shall be filed by or
on behalf of Tenant in any public record. Landlord may prepare and file, and
upon request by Landlord Tenant will execute, a memorandum of lease.
(g) The normal rule of construction to the effect that any ambiguities
are to be resolved against the drafting party shall not be employed in the
interpretation of this Lease or any exhibits or amendments hereto.
(h) The submission by Landlord to Tenant of this Lease shall have no
binding force or effect, shall not constitute an option for the leasing of the
Premises, nor confer any right or impose any obligations upon either party until
execution of the Lease by both parties.
(i) Words of any gender used in this Lease shall be held and construed
to include any other gender, and words in the singular number shall be held to
include the plural, unless the context otherwise requires. The captions inserted
in this Lease are for convenience only and in no way define, limit or otherwise
describe the scope or intent of this lease, or any provision hereof, or in any
way affect the interpretation of this Lease.
(j)) Any amount not paid by Tenant within 5 days after written notice
(provided that Landlord shall not be required to provide notice of monetary
default more than twice in any 12 month period or more than four (4) times
during the term of this Lease, as it may be extended) from the date such payment
was due after its due date in accordance with the terms of this Lease shall bear
interest from such due date until paid in full at the lesser of the highest rate
permitted by applicable law or 12 percent per year. It is expressly the intent
of Landlord and Tenant at all times to comply with applicable law governing the
maximum rate or amount of any interest payable on or in connection with this
Lease. If applicable law is ever judicially interpreted so as to render usurious
any interest called for under this Lease; or contracted for, charged, taken,
reserved, or received with respect to this Lease, then it is Landlord's and
Tenant's express intent that all excess amounts theretofore collected by
Landlord be credited on the applicable obligation (or, if
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the obligation has been or would thereby be paid in full, refunded to Tenant),
and the provisions of this Lease immediately shall be deemed reformed and the
amounts thereafter collectible hereunder reduced, without the necessity of the
execution of any new document, so as to comply with the applicable law, but so
as to permit the recovery of the fullest amount otherwise called for hereunder.
(k) Construction and interpretation of this Lease shall be governed by
the laws of the state in which the Project is located, excluding any principles
of conflicts of laws.
(l) Time is of the essence as to the performance of the parties
obligations under this Lease.
(m) All exhibits and addenda attached hereto are hereby incorporated
into this Lease and made a part hereof. In the event of any conflict between
such exhibits or addenda and the terms of this Lease, such exhibits or addenda
shall control.
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39. Limitation Of Liability Of Trustees, Shareholders, And Officers Of
Security Capital Industrial Trust. Any obligation or liability whatsoever of
Security Capital Industrial Trust, a Maryland real estate investment trust,
which may arise at any time under this Lease or any obligation or liability
which may be incurred by it pursuant to any other instrument, transaction, or
undertaking contemplated hereby shall not be personally binding upon, nor shall
resort for the enforcement thereof be had to the property of, its trustees,
directors, shareholders, officers, employees or agents, regardless of whether
such obligation or liability is in the nature of contract, tort, or otherwise.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of
the day and year first above written.
TENANT: LANDLORD:
SteriGenics International, a California Corporation SCI Limited Partnership-I, a
/s/signature unreadable Delaware Limited Partnership
Sr. VP Engineering
By: for By: /s/ signature unreadable
---------------------------------------------- ------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, III
Title: President and CEO Title: Managing Director
Address: Address:
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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13
Rules and Regulations
---------------------
1. The sidewalk, entries, and driveways of the Project shall not be
obstructed by Tenant, or its agents, or used by them for any purpose
other than ingress and egress to and from the Premises.
2. Tenant shall not place any objects, including antennas, outdoor
furniture, etc., in the parking areas, landscaped areas or other areas
outside of its Premises, or on the roof of the Project.
3. Except for seeing-eye dogs, no animals shall be allowed in the offices,
halls, or corridors in the Project.
4. Tenant shall not disturb the occupants of the Project or adjoining
buildings by the use of any radio or musical instrument or by the
making of loud or improper noises.
5. If Tenant desires telegraphic, telephonic or other electric connections
in the Premises, Landlord or its agent will direct the electrician as
to where and how the wires may be introduced; and, without such
direction, no boring or cutting of wires will be permitted. Any such
installation or connection shall be made at Tenant's expense.
6. Tenant shall not install or operate any steam or gas engine or boiler,
or other mechanical apparatus in the Premises, except as specifically
approved in the Lease. The use of oil, gas or inflammable liquids for
heating, lighting or any other purpose is expressly prohibited.
Explosives or other articles deemed extra hazardous shall not be
brought into the Project.
7. Parking any type of recreational vehicles is specifically prohibited on
or about the Project. Except for the overnight parking of operative
vehicles, no vehicle of any type shall be stored in the parking areas
at any time. In the event that a vehicle is disabled, it shall be
removed within 48 hours. There shall be no "For Sale" or other
advertising signs on or about any parked vehicle. All vehicles shall be
parked in the designated parking areas in conformity with all signs and
other markings. All parking will be open parking, and no reserved
parking, numbering or lettering of individual spaces will be permitted
except as specified by Landlord.
8. Tenant shall maintain the Premises free from rodents, insects and other
pests.
9. Landlord reserves the right to exclude or expel from the Project any
person who, in the judgment of Landlord, is intoxicated or under the
influence of liquor or drugs or who shall in any manner do any act in
violation of the Rules and Regulations of the Project.
10. Tenant shall not cause any unnecessary labor by reason of Tenant's
carelessness or indifference in the preservation of good order and
cleanliness. Landlord shall not be responsible to Tenant for any loss
of property on the Premises, however occurring, or for any damage done
to the effects of Tenant by the janitors or any other employee or
person.
11. Tenant shall give Landlord prompt notice of any defects in the water,
lawn sprinkler, sewage, gas pipes, electrical lights and fixtures,
heating apparatus, or any other service equipment affecting the
Premises.
12. Tenant shall not permit storage outside the Premises, including without
limitation, outside storage of trucks and other vehicles, or dumping of
waste or refuse or permit any harmful materials to be placed in any
drainage system or sanitary system in or about the Premises.
13. All moveable trash receptacles provided by the trash disposal firm for
the Premises must be kept in the trash enclosure areas, if any,
provided for that purpose.
14. No auction, public or private, will be permitted on the Premises or the
Project.
15. No awnings shall be placed over the windows in the Premises except with
the prior written consent of Landlord.
16. The Premises shall not be used for lodging, sleeping or cooking or for
any immoral or illegal purposes or for any purpose other than that
specified in the Lease. No gaming devices shall be operated in the
Premises.
17. Tenant shall ascertain from Landlord the maximum amount of electrical
current which can safely be used in the Premises, taking into account
the capacity of the electrical wiring in the Project and the Premises
and the needs of other tenants, and shall not use more than such safe
capacity. Landlord's consent to the installation of electric equipment
shall not relieve Tenant from the obligation not to use more
electricity than such safe capacity.
18. Tenant assumes full responsibility for protecting the Premises from
theft, robbery and pilferage.
19. Tenant shall not install or operate an the Premises any machinery or
mechanical devices of a nature not directly related to Tenant's
ordinary use of the Premises and shall keep all such machinery free of
vibration, noise and air waves which may be transmitted beyond the
Premises.
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EXHIBIT A
[DIAGRAM]
HAYWARD INDUSTRIAL CENTER
PHASE III
15
EXHIBIT B
[DIAGRAM]
HAYWARD INDUSTRIAL CENTER, PHASE III, BUILDING G
▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
PREMISES
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EXHIBIT C
[Company Letterhead]
SIGN CRITERIA
-------------
HAYWARD INDUSTRIAL CENTER
TENANT IDENTIFICATION SIGNS
BASIC IDENTIFICATION SIGN:
Each Tenant is allowed a basic identification sign to display company name in
11" microgramma letters the color of which shall match the accent stripes on the
building. Logos or symbols of the same construction as letters are allowed a
maximum of 20" in any one dimension, color may be determined by Tenant and
approved by ownership. Letters and logos are to be non-illuminated and
individually mounted with the building facade providing the background.
Corporate or company names will be listed in capital letters only, no lower case
letters are allowed. Letter height will remain consistent at 11" with the length
of the sign varying according to the length of the name displayed. Logos or
symbols are to be centered from top to bottom in the sign area. Names will be
mounted depending upon office location as per Exhibits A & B. Logo placement is
dependent upon sign location. This Tenant building sign while be restricted to
company or corporate name and logo or symbol only, no division names,
descriptions of services or slogans are allowed in this sign area. A layout of
letter placement is to be approved by the ownership prior to installation.
WINDOW SIGNS
Identity signs displaying trademarks or logos may be used on the glass panel to
the left or the right of the entrance door depending upon location of basic
identification sign (see above), i.e., if identification sign is mounted to the
right of the outside window frame, then window sign would be placed on glass
panel to the left of the entrance door (see Exhibits A & B). These signs may be
either painted or pressure sensitive vinyl or a combination of both. Company
names shall be listed in 3" white pressure sensitive capital letters in the
microgramma style. Logos and symbols may be in corporate colors as determined by
Tenant. Tenant Is required to submit a layout to the ownership for final
approval.
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ADDENDUM I
CONSTRUCTION
(ALLOWANCE)
ATTACHED TO AND A PART OF THE LEASE AGREEMENT
DATED August 16, 1996, BETWEEN
SCI Limited Partnership-I
and
SteriGenics International
a. Initial Tenant Improvements: Allowance. The leasehold improvements to
be constructed by Tenant (the "Initial Tenant Improvements)", at
Tenant's sole cost and expense (except for the hereinbelow described
"Allowance", are generally described in the preliminary plans and
specifications (the "Preliminary Plans") identified on Attachment 1 to
this Addendum and shall be constructed in accordance with the Final
Plans to be submitted by Tenant and reviewed and approved by Landlord
in accordance with the provisions of Paragraph (b) of this Addendum.
Note: Landlord, at Landlord's sole cost and expense, shall construct
the following improvements without regard to the tenant improvement maximum as
stated below:
- repair cracks and protrusions in warehouse floor
- remove, cap, and back-fill existing floor drains in warehouse
- reinstall two rows of fluorescent warehouse lighting (not to
exceed six two- bulb 8' chain hung fluorescent fixtures per
row)
- remove inoperable electrical service panel/disconnect at
exterior of electrical service room on interior of premises.
Landlord shall have no obligation to construct or to pay for the
construction of the Initial Tenant Improvements. However, in addition
to Landlord's obligation to perform the Landlord's Improvements in
accordance with Addendum 1 above, Landlord agrees to contribute toward
the cost of construction of the Initial Tenant Improvements the cash
sum of up to $72,750 (the "Allowance"). The construction costs that may
be reimbursed from the Allowance shall Include only the following:
costs of labor, equipment, supplies and materials furnished for
construction of the Initial Tenant Improvements; governmental fees and
charges for required permits, plan checks, and inspections for the
Initial Tenant Improvements; charges for Tenant's design professionals;
and charges for Landlord's design professionals for review of plans and
monitoring of construction or installation of the Initial Tenant
Improvements. No other costs, fees or expenses of the Initial Tenant
Improvements shall be reimbursable out of the Allowance.
Landlord's payment of the Allowance, or such portion thereof as Tenant
may be entitled to, shall be made within thirty (30) days after each
and all of the following conditions shall have been satisfied: (1) the
Initial Tenant Improvements shall have been substantially completed in
accordance with the Final Plans; (2) Tenant shall have delivered to
Landlord satisfactory evidence that all mechanics lien rights of all
contractors, suppliers, subcontractors, or materialmen furnishing
labor, supplies or materials in the construction or installation of the
Initial Tenant Improvements have been unconditionally waived, released,
or extinguished; (3) Tenant shall have delivered to Landlord paid
receipts or other written evidence satisfactorily substantiating the
actual amount of the construction costs of the Initial Tenant
Improvements; (4) Tenant shall have delivered to Landlord a temporary
or final certificate of occupancy for the Premises; (5) Tenant shall
not then be in default of any of the provisions of the Lease; (6)
Tenant shall have occupied and opened for business at the Premises; and
(7) Tenant has submitted to Landlord the following: (i) original
"jobsite copy" of the permit drawings; (ii) permit cards signed off by
the building Inspector; (iii) a recorded copy of the notice of
Completion issued by the building inspector of the City of Hayward;
(iv) "as-built" drawings of the electrical, HVAC, plumbing and fire
protection system; (v) one copy of all warranties and maintenance and
operating manuals; (vi) a letter from Tenant's architect certifying
that the Initial Tenant Improvements were completed in accordance with
the Final Plans (defined below); and (vii) a copy of the Tenant's
Contractor's (defined below) Application of Payment (ALA Document
G702), certified by Tenant's architect. If Landlord claims any credits
against the Allowance for any costs paid directly by Landlord to third
parties, Landlord shall provide Tenant with evidence of payment of such
costs.
b. Preparation and Review of Plans for Initial Tenant Improvements. The
Preliminary Plans identified on Attachments 1 to this Addendum 1 have
been approved by Landlord and signed by Landlord and Tenant for
identification. However, such Preliminary Plans shall not be used by
Tenant for the purposes of constructing or installing the Initial
Tenant Improvements. Tenant, suing licensed architectural and
engineering firms selected by Tenant and approved by Landlord (which
approval shall not be unreasonably withheld or delayed), shall prepare
or cause to be prepared and submitted, concurrently, and in each case
by receipted courier or delivery service, to (i) Landlord's
construction representative, (i) ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇, and (ii) Landlord's offices at ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, attn: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, for
landlord's review, complete and final architectural and engineering
drawings and specifications (hereinafter collectively referred to as
the "Final Plans"), consistent with the description of the Initial
Tenant Improvements set forth on the Preliminary Plans.
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Subject to the provisions of Paragraph (c) of this Addendum 1, Landlord
agrees that Tenant may commence construction of the Initial Tenant
Improvements prior to finalization for the Final Plans and Landlord
agrees that it shall cooperate with Tenant to review and approve
portions of the Final Plans for different stages or elements of the
work, or proposed Final Plans submitted at less than 100% completion,
so that construction can proceed on a "fast track" basis. The approval
process for all such portions of the Final Plans shall be substantially
as set forth below, but any objection by Landlord to Final Plans
submitted to Landlord may not be inconsistent with previously approved
portions of the Final Plans. However, in no event shall any portion of
the Initial Tenant Improvements be constructed or installed unless and
until Landlord has approved (or is deemed to have approved) Final Plans
at 100 % completion for such portion of the work.
Each set of proposed Final Plans furnished by Tenant shall include at
least two (2) sets of prints. The Final Plans shall be compatible with
the design, construction, and equipment of the building, and shall be
capable of logical measurement and construction. Unless Landlord shall
otherwise agree in writing, the Final Plans shall be signed/stamped by
Tenant's architect or engineer, as applicable, and shall include (to
the extent relevant or applicable to the portion of the work for which
Tenant is seeking Final Plan approval) each and all of the following:
(i) a Partition (Floor) Plan, @ 1/8" = 1'-0" minimum scale, including
partition types, partition construction sections and details, and
door/frame/hardware schedules; (ii) a Reflected Ceiling Plan, @ 1/8" =
1'-0" minimum scale, including ceiling construction and specifications
for ceiling lighting fixtures; (iii) a
Telephone/Electrical/Communications Plan, @ 1/8" = 1'-0" minimum scale,
including a complete schedule, cross-referenced to said plan, of
Tenant's telephone/electric/communications equipment and providing said
equipment's electrical power specifications, requirements and heat
output: (iv) a Final Plan, including all finish specifications and U.L.
and/or County "approval numbers" where required; (v) Elevations, @ 1/2"
= 1'0" minimum scale, interior, of all walls, with detail/section
cross-references where appropriate; exterior, of Tenant's portion of
the permitted Building-front wall, clearly indicating the appearance of
Tenants space, including its signage, at/through Tenant's permitted
Building window wall (if any); (vi) details and sections, scale as
required, for all partition types, structural elements and connections,
and custom installations where they occur (HVAC, lighting, etc); (vii)
details and sections, scale as required, for all signage and graphics;
(viii) a Structural Engineering plan, locating and detailing any
modifications to the Building required to attach and/or support the
Initial Tenant Improvements or Tenant's trade fixtures or equipment
(this plan must be signed/stamped by a structural engineer licensed in
the State in which the Premises are situated); (ix) Electrical
Engineering Plans, for both electrical power and for lighting,
including but not limited to: circulating diagrams; panel schedules;
electrical equipment and lighting fixture schedules and sections; and
electrical equipment and lighting fixture electrical load tabulations
(these plans and calculations must be signed/stamped by an electrical
engineer licensed in the State in which the Premises are situated); (x)
Mechanical Engineering Plans, for both plumbing and for HVAC, including
but not limited to: plumbing water and waste line plans; HVAC supply,
return and exhaust plans; and HVAC tabulations for electrical equipment
and lighting heat loads, cooling loads and air supply (these plans and
calculations must be signed/stamped by a mechanical engineer licensed
in the State in which the Premises are situated); (xi) a Fire
Protection Plan, locating and detailing any fire protection/fire
suppression system as may be required by code or other regulations
governing Tenant's operations in the Premises (this plan must be
signed/stamped by a fire protection engineer licensed in the State in
which the Premises are situated); and (xii) any other or additional
plans as may be related to Tenant's specific use of the Premises, such
as plans for rooms enclosures, equipment or devices related to Tenant's
permitted storage or use of Hazardous materials at the Premises (if
any), or as may be required by local city ordinance or building code.
Tenant shall submit all Final Plans (or portions thereof) concurrently
to Landlord's construction representative and offices, as designated
above for Landlord's review and approval. Landlord shall have five (5)
business days after Landlord's receipt of the proposed Final Plans (or
each such portion thereof) to review the same and notify Tenant in
writing of any comments or required changes, or to otherwise give its
approval or disapproval of such proposed Final Plans (or the portion
thereof submitted to Landlord). If Landlord fails to give written
comments to or disapprove the Final Plans (or the portion thereof
submitted to Landlord) within such five (5) business day period, then
Landlord shall be deemed to have approved the Final Plans (or portion
thereof) as submitted. Tenant shall have five (5) business days
following its receipt for Landlord's comments and objections to redraw
the proposed Final Plans (or portion thereof submitted to Landlord) in
compliance with Landlord's request and to resubmit the same for
Landlord's final review and approval or comment within three (3)
business days of Landlord's receipt of such revised plans. Such process
shall be repeated as necessary until final approval or deemed approval
by Landlord of the proposed Final Plans (or each portion thereof), at
100% completion, has been obtained. Landlord may at any time by written
notice given in accordance with the notice provisions of the Lease
change the name and/or address of the designated Landlord's
construction representative to receive plans delivered by Tenant to
Landlord.
In the event that Tenant disagrees with any of the changes to the
proposed Final Plans (or portion thereof) required by Landlord, then
Landlord and Tenant shall consult with respect thereto and each party
shall use all reasonable effort to promptly resolve any disputed
elements of such proposed Final Plans (or portion thereof). Landlord
and Tenant agree that if after consultation with each other and their
respective architects they are unable to resolve any disputed items
within three (3) business days of Landlord's written objection, then
within three (3) business days thereafter (I) Landlord's architect
shall select an architect who is unaffiliated with Landlord or tenant
to resolve the dispute (the "Arbitrator")., and (ii) each party shall
state to the Arbitrator its final position in writing as respects the
disputed matter(s) The Arbitrator shall decide on each disputed matter
within three (3) business days of submission of such matter, based
solely on such written submissions and the consistency of the parties'
submissions with the Preliminary Plans or previously approved portion
of the Final Plans, as applicable, the Tenant's permitted use of the
Premises and the
19
general nature and design of the Project and adjacent properties. The
parties consent to the jurisdiction of any appropriate court to enforce
and enter judgments upon the decision of the Arbitrator. Tile losing
party shall pay the cost of the Arbitrator, but each party shall
otherwise bear its own costs and expenses in connection with the
dispute.
For purposes here, "business days" shall be all calendar days except
Sundays and holidays observed by national banks in Alameda County,
California, but Saturdays shall not constitute or be a business day for
purposes of delivery of documents by one party to the other.
Notwithstanding the preceding provisions of this Paragraph (b)), under
no circumstances whatsoever shall (i) any combustible materials be
utilized above finished ceiling or in any concealed space, (ii) any
structural load, temporary or permanent, be exerted on any part of the
Building without the prior written approval of Landlord, or (iii) any
holes be cut or drilled in any part of the roof or other portion of the
Building shell without the prior written approval of Landlord.
In the event that Tenant proposes any changes to the Final Plans (or
any portion thereof) after the same have been approved by Landlord,
Landlord shall not unreasonably withhold its consent to any such
changes, provided the changes do not, in Landlord's reasonable opinion,
adversely affect the Building structure, systems, or equipment, or the
external appearance of the Premises.
As soon as Final Plans (or a portion thereof sufficient to permit
commencement of construction or installation of the Initial Tenant
Improvements, if Tenant elects to proceed with a "fast track"
construction) are mutually agreed upon, Tenant shall use diligent
efforts to obtain all required permits authorizations, and licenses
form appropriate governmental authorities for construction of the
Initial Tenant Improvements (or such portion thereof, as applicable).
Tenant shall be solely responsible for obtaining any business or other
license or permit required for the conduct of its business at the
Premises.
c. Construction of the Initial Tenant Improvements. Construction or
installation of the Initial Tenant Improvements shall be performed by a
licensed general contractor or contractors selected by Tenant and
approved by Landlord, such approval not to be unreasonably withheld or
delayed (the "Tenant's Contractor", whether one or more), pursuant to a
written construction contract negotiated and entered into by and
between the Tenant's Contractor and Tenant and approved by Landlord
(such approval not to be unreasonably withheld or delayed). Each such
contract shall (i) obligate Tenant's Contractor to work in harmony with
the employees, contractors own suppliers of Landlord involved in the
construction work being performed by Landlord pursuant to Addendum B to
the Lease, and to comply with all rules and regulations of Landlord of
general applicability relating to construction activities in the
Project, (ii) name Landlord as an additional indemnitee under the
provisions of the contract whereby the Tenant's Contractor holds Tenant
harmless form and against any and all claims, damages, losses,
liabilities and expenses arising out of or resulting form the
performance of such work, (iii) name Landlord as a beneficiary of (and
a party entitled to enforce) all of the warranties for the Tenant's
Contractors with respect to the work performed thereunder and the
obligation of the Tenant's Contractor to replace defective materials
and correct defective ownership for a period of not less than one (1)
year following substantial completion of the work under such contract,
(iv) evidence the agreement of the Tenant's Contractor that the
provisions of the Lease shall control over the provisions of the
Contract with respect to distribution or use of insurance proceed, in
the event of a casualty during construction and (v) evidence with
waiver and release by the Tenant's Contractor of any lien or right to
assert a lien on all or any portion of the fee estate of Landlord in
and to the Project as a result for the work performed or to be
performed hereunder (and obligating the Tenant's Contractor to include
a substantially similar release and waiver provision in all
subcontracts and purchase orders entered under or pursuant to the
contract).
Tenant acknowledges and understands that all roof penetrations involved
in the construction of the Initial Tenant improvements must be
performed by the Building shell roofing contractor. All costs, fees and
expenses incurred with such contractor in performing such work shall be
a cost for the Initial Tenant Improvements, payable in accordance with
the provisions of this Addendum. Tenant or Tenant's Contractor shall be
responsible for all water, gas, electricity, sewer or other utilities
used or consumed at the Premises during the construction of the Initial
Tenant Improvements.
Tenant specifically agrees to carry, or cause the Tenant Contractor to
carry, during all such items as the Tenant's work is being performed,
(a) builder's risk completed value insurance on the Initial Tenant
Improvements, in an amount not less than Four Million Dollars
($4,000,000.00), (b)a policy of insurance covering commercial general
liability, in an amount not less than One Million Dollars
($1,000,000.00), combined single limit for bodily injury and property
damage per occurrence (and combined single limit coverage of
$2,000,000.00 in the aggregate), and automobile liability coverage
(including owned, nonowned and hired vehicles) in an amount not less
than One Million Dollars ($1,000,000.00) combined single limit (each
person, each accident), and endorsed to show Landlord as an additional
insured, and (c) workers' compensation insurance as required by law,
endorsed to show a waiver of subrogation by the insurer to any claim
the Tenant's Contractor may have against Landlord. Tenant shall not
commence construction of the Initial Tenant Improvements (or any
portion thereof) until Landlord has issued to Tenant a written
authorization to proceed with construction, which Landlord agrees to
issue to Tenant within one (1) business day after Tenant has delivered
to Landlord's construction representative (i) certificates for the
insurance policies described above, (ii) copies of all permits required
for construction of the Initial Tenant Improvements (or applicable
portion thereof, if Tenant elects to proceed with a "fast track"
construction) and a copy of the permitted Final Plans (or applicable
portion thereof) as approved by the appropriate governmental agency, a
(iii) copy of each signed construction contract for the Initial Tenant
Improvements (a copy of each subsequently signed contract shall be
forwarded to Landlord's construction representative
20
without request or demand, promptly after execution thereof and prior
to the performance of any work thereunder), and (iv) list of names,
addresses and phone numbers of all subcontractors, contractors and
suppliers involved in performing the Initial Tenant Improvements. All
of the construction shall be the responsibility of and supervised by
Tenant.
d. Requirements for Tenant's Work. All of Tenant's construction with
respect to the Premises shall be performed in substantial compliance
with this Addendum and the Final Plans therefor previously approved in
writing by Landlord (and any changes thereto approved by Landlord as
herein provided), and in a good and workmanlike manner, utilizing only
new materials. All such work shall be performed by Tenant in strict
compliance with all applicable building codes, regulations and all
other legal requirements. All materials utilized in he construction of
Tenant's work must be confined to within the Premises. All trash and
construction debris not located wholly within the Premises must be
removed each day form the Project at the sole cost and expense of
Tenant. Landlord shall have the right at all times to monitor the work
for compliance with the requirements of this Addendum. If Landlord
determines that any such requirements are not being strictly complied
with, Landlord may immediately require the cessation of all work being
performed in or around the Premises or the Project until such time as
Landlord is satisfied that the applicable requirements will be
observed. Any approval given by Landlord with respect to Tenant's
construction of the Preliminary plans or Final Plans therefor, and/or
any monitoring of Tenants work by Landlord, shall not make Landlord
liable or responsible in any way for the condition, quality or function
of such matters or constitute any undertaking, warranty or
representation by Landlord with respect to any of such matters. So long
as Landlord reviews and responds to the plan submissions to Landlord as
provided in this Addendum, no delays in plan approval, and no delays in
construction of the Initial Tenant Improvements, shall delay the
Commencement Date of this Lease.
e. No Liens: Indemnification. Tenant shall have no authority to place any
lien upon the Premises or the Project or any portion thereof or
interest therein, nor shall Tenant have any authority in any way to
bind Landlord, and any attempt to do so shall be void and of no effect.
If, because of any actual or alleged act or omission of Tenant, or
Tenant's Contractor, or any subcontractors or materialmen, any lien,
affidavit, charge or other for the payment of money shall be filed
against Landlord, the Promises, the Project, or any portion thereof, or
interest herein, whether or not such lien, affidavit, charge or order
is valid or enforceable, Tenant shall, at its sole cost and expense,
cause the same to be discharged of record by payment, bonding or
otherwise no later than fifteen (15) days after notice to Tenant of the
filing hereof, but in any event prior to the foreclosure thereof.
With respect to the contract for labor or materials for construction of
the Initial Tenant Improvements, Tenant acts as principal and not as
the agent of Landlord. Landlord expressly disclaims liability of the
cost of labor performed for or supplies or materials furnished to
Tenant. Landlord may post one or more "notices of non-responsibility"
for Tenants work on the Project. No contractor of Tenant is intended to
be a third-party beneficiary with respect to he costs for construction
of the Initial Tenant Improvements. Tenant agrees to indemnify, defend
and hold Landlord, the Premises and the Project, harmless form all
claims (including all costs and expenses of defending against such
claims) arising or alleged to arise from any act or omission of Tenant
or Tenant's agents, employees, contractor, subcontractors, suppliers,
materialmen, architects, designers, surveyors, engineers, consultants,
laborers, or invitees, or arising from any bodily injury or a property
damage occurring or alleged to have occurred incident to any of the
work to be performed by Tenant or its contractors or subcontractors
with respect to the Promises.
Default by Tenant under this Addendum 1 shall constitute a default by
Tenant under the Lease for all purposes.
21
ATTACHMENT 1
to
ADDENDUM 1
Identification of Preliminary Plans:
The "Preliminary Plans" for the Initial Tenant Improvements
heretofore approved by Landlord are identified as the plans prepared by
D.E.S.; bearing Project No. _______, dated _________________, and
consisting of __ sheets signed by Landlord and Tenant.
22
ADDENDUM 2
STORAGE AND USE OF PERMITTED HAZARDOUS MATERIALS
ATTACHED TO AND A PART OF THE LEASE AGREEMENT
DATED August 16, 1996 BETWEEN
SCI Limited Partnership-I
and
SteriGenics International
1. Permitted Hazardous Materials and Use.
(a) Tenant has requested Landlord's consent to use the Hazardous
Materials listed below in its business at the Premises (the "Permitted Hazardous
Materials'). Subject to the conditions set forth herein, Landlord hereby
consents to the Use (hereinafter defined) of the Permitted Hazardous Materials.
Any Permitted Hazardous Materials on the Premises will be generated, used,
received, maintained, treated, stored, or disposed in a manner consistent with
good engineering practice and in compliance with all Environmental Requirements.
Permitted Hazardous Material (including maximum quantities):
(To be provided by Tenant on or before September 1, 1996)
The storage, uses or processes involving the Permitted
Hazardous Materials (the "Use") are described below.
Use [If limited to receiving and storage, so specify]:
(To be provided by Tenant on or before September 1, 1996)
2. No Current Investigation
Tenant represents and warrants that it is not currently subject to an
inquiry, regulatory investigation, enforcement order, or any other proceeding
regarding the generation, use, treatment, storage, or disposal of a Hazardous
Material.
3. Notice and Reporting
Tenant immediately shall notify Landlord in writing of any spill,
release, discharge, or disposal of any Hazardous Material in, on or under the
Premises or the Project handled or used by Tenant, its agents, employees,
contractors, or invitees. All reporting obligations imposed by Environmental
Requirements are strictly the responsibility of Tenant relating to hazardous
materials used or handled by Tenant, its agents, employees, contractors or
invitees.
Tenant shall supply to Landlord within 5 business days after Tenant
first receives or sends the same, copies of all claims, reports, complaints,
notices, warnings or asserted violations relating in any way to Tenant's use of
the Premises.
4. Indemnification.
Tenants indemnity obligation under the Lease with respect to azardous
Materials shall include indemnification for the liabilities, expenses and other
losses described therein as a result of the of the ues Hazardous Materials or
the breach of Tenant's obligations or representations set forth above. It is the
intent of this provision that Tenant be strictly liable to Landlord a result of
the use by Tenant, its agents, employees, contractors, or invitees of Hazardous
Materials without regard to the fault or negligence of Tenant, Landlord or any
third party.
5. Disposal Upon Lease Termination.
At the expiration or earlier termination of the Lease, Tenant, at its
sole cost and expense, shall: (i) remove and dispose off-site any drums,
containers, receptacles, structures, or tanks storing or containing Hazardous
Materials (or which have stored or contained Hazardous Materials) placed on
Premises by Tenant, its agents, employees, contractors, or invitees and the
contents thereof; (ii) remove, empty, and purge all underground and above ground
storage tank systems, including connected piping, of all vapors, liquids,
sludges and residues; and (iii) restore the Premises to its original condition.
Such activities shall be performed in compliance with all Environmental
Requirements and to the satisfaction of Landlord. Landlord's satisfaction with
such activities or the condition of the Premises does not waive, or release
Tenant from, any obligations hereunder.
23
ADDENDUM 3
VACATION OF PREMISES
ATTACHED TO AND A PART OF THE LEASE AGREEMENT
DATED August 16,1996 , BETWEEN
SCI Limited Partnership-I
and
SteriGenics International
Tenant's vacating of the Premises shall not constitute an Event of
Default if, prior to vacating the Premises, Tenant has made arrangements
reasonably acceptable to Landlord to (a) insure that Tenant's insurance for the
Premises will not be voided or cancelled with respect to the Premises as a
result of such vacancy, (b) insure that the Premises are secured and not subject
to vandalism, and (c) insure that the Premises will be properly maintained after
such vacation. Tenant shall inspect the Premises at least once each month and
report monthly in writing to Landlord on the condition of the Premises
24
ADDENDUM 4
INDEMNIFICATION BY LANDLORD
ATTACHED TO AND A PART OF THE LEASE AGREEMENT
DATED August 16, 1996, BETWEEN
SCI Limited Partnership - I
and
SteriGenics International, a California Corporation
Landlord convenants and agrees to indemnify and save Tenant, its
employees and agents harmless of and from any and all claims, costs, expenses
and liabilities, including, without limitation, attorney' fees, arising on
account of or by reason of claims by third parties for injuries or death to
persons or damages to property resulting from the negligence or willful
misconduct of Landlord or its agents, employees, or contractors, to the extend
not attributable to any negligence of Tenant, any assignee or subtenant of
Tenant, or their respective employees, agents, or contractors. If a claim under
the foregoing indemnity is made against the indemnity which the indemnitee
believes to be covered by an indemnitor's indemnification obligations hereunder,
the indemnitee shall promptly notify the indemnitor of the claim and, in such
notice shall offer to the indemnitor the opportunity to assume the defense of
the claim within 10 business days after receipt of the notice (with counsel
reasonably acceptable to the indemnitee). If the indemnitor timely elects to
assume the defense of the claim, the indemnitor shall have the right to settle
the claim on any terms it considers reasonable and without the indemnitee's
prior written consent, as long as the settlement shall not require the
indemnitee to render any performance or pay any consideration, and the
indemnitee shall not have the right to settle any such claim. If the indemnitor
fails timely to elect to assume the defense of the claim or fails to defend the
claim with diligence, then the indemnitee shall have the right to take over the
defense of the claim and to settle the claim on any Terms the indemnitee
considers reasonable. Any such settlement shall be valid as against the
indemnitor. If the indemnitor assumes the defense of a claim, the indemnitee may
employ its own counsel but such employment shall be at the sole expense of the
indemnitee. If any such claim arises out of the negligence of both Landlord and
Tenant, responsibility for such claim shall be allocated between Landlord and
Tenant based on their respective degrees of negligence. This indemnity does not
cover claims arising from the presence or release of Hazardous Materials.
25
FIRST ADDENDUM TO LEASE
This FIRST ADDENDUM TO LEASE ("First Addendum") is dated for reference
purposes as of 3/27, 1997 and is made by and between SCI Limited Partnership-1,
a Delaware Limited Partnership ("Landlord"), and Sterigenics International, a
California Corporation ("Tenant") to be a part of that certain Lease dated
August 16, 1996, for the premises located at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇. Landlord and Tenant hereby agree that the Lease is hereby modified
and supplemented as follows:
1. Base Rent: Per the Lease agreement, Landlord agreed to reduce the
base monthly rent $.01 per square foot per month for every unused dollar per
square foot of Tenant Improvement allowance. The actual Tenant Improvement costs
were $66,747 versus the $72,750 allowance. Therefore, commencing March 1, 1997,
the monthly base rent shall be adjusted to $13,273.
2. Effective Addendum: In the event of any inconsistency between this
First Addendum and the Lease, the terms of this First Addendum shall prevail.
LANDLORD: TENANT:
SCI Limited Partnership-I, a Sterigenics International, a
Delaware Limited Partnership California Corporation
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------- ------------------------------
Print Name: ▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Print Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President Title: President & CEO
Date: 4/29/97 Date: 3/27/97
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