STANDARD INDUSTRIAL LEASE
Dated (for reference) as of February 23, 2000
1. Defined Terms. Each reference in this Lease to any of the following terms
shall include the data for such term as stated below with any additional terms
used in this Lease to have the meaning and definition given hereinafter:
Tenant: Xxxxxx Beverage Company, Landlord: 43 Railroad Partnership L.P.
A Delaware Corporation California limited partnership
Tenant's Address: Xxxxxxxx's Address:
0000 Xxxxxxxx Xxxxxx -c/o Investment Building Group
Corona, California 92882 0000 Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
Description of the Premises:
Floor Area: Approximately 113,600 square feet indicated on Exhibit "A".
(Including +/- 5, 000 s.f. of 2nd floor office)
Street Address 0000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxx
Term: ten (10) years
Commencement Date: August 1, 2000
Rent: forty-four thousand dollars ($44,000) per month (see Paragraph 39, 40)
Taxes, Insurance and Maintenance Reserve Deposit: $4,600 per month
Security Deposit: $40,000
Insurance Amounts:
Bodily Injury per Person Three million dollars ($3,000,000)
Bodily Injury per Occurrence Three million dollars ($3,000,000)
Property Damage One million dollars ($1,000,000)
Tenant Improvement Plans (approved by Xxxxxx and Landlord): ..See Exhibit "B"
Tenant's Construction Representative: .........................................
Uses: Warehousing, packaging and distribution of consumer products/corporate
offices.
Tenant's Share (if multi-tenant) of: Real Property Taxes 81% Insurance Expenses
81% Maintenance Expenses 81% for building #10 only.
2. Preamble. Landlord hereby leases to Tenant, and Tenant hereby leases and
accepts from Landlord, that certain real property and building floor area more
particularly described in Paragraph I (the "Premises") for the Term and upon the
covenants and conditions hereinafter specified.
3. Construction and Commencement.
3.1 Construction. Landlord shall cause to be constructed the building and
improvements substantially in accordance with the Tenant Improvement Plans. The
Premises shall be ready for occupancy on the date upon which the work of
construction to be undertaken by Landlord has been substantially completed
("Ready for Occupancy") as determined by the issuance of a written certificate
by Landlord to Tenant certifying (a) that the improvements have been
substantially completed in accordance with the Tenant Improvement Plans, and (b)
the date of such completion. Landlord shall complete, as soon as reasonably
possible, any items of work or adjustment not completed when the Premises are
Ready for Occupancy and such defective or omitted work undertaken by Landlord of
which Tenant has given Landlord written notice within thirty (30) days after the
date the Premises are Ready for Occupancy. The Premises shall be Ready for
Occupancy not later than the Commencement Date; provided, however, that the
Commencement Date may be extended for a period of time equal to the period of
any delay encountered by Landlord affecting said work of construction because of
fire, inclement weather, acts of God, riot, governmental regulations, strikes,
shortages of material or labor, changes in the Tenant Improvement Plans, or any
other cause beyond the reasonable control of Landlord.
3.2 Commencement. The Term of this Lease shall commence upon the earlier
of: (a) the Commencement Date, or if the Premises are not Ready for Occupancy by
the Commencement Date, the date upon which the Premises are Ready for Occupancy,
(b) the date upon which Tenant first occupies any portion of the Premises, or
(c) the date upon which Rent would have otherwise commenced to accrue under this
Lease had Tenant not delayed in the performance of any of its duties or
obligations hereunder or had not otherwise interfered with or caused a delay in
the performance of Xxxxxxxx's obligations hereunder. If the work of construction
is not completed within one hundred twenty (120) days after the Commencement
Date as extended pursuant to Paragraph 3.1, the sole remedy of either party
shall be the option to terminate this Lease by the delivery to the other party
of written notice of such termination within ten (10) days thereafter.
4. Rent; Net Lease. Tenant agrees to pay Landlord at Xxxxxxxx's address or at
such other place designated by Landlord by written notice to Tenant the Rent, in
lawful money of the United States, in advance, without demand, off-set or
deduction, on the first day of each calendar month of the Term hereof and in the
event the Term commences or the date of expiration of this Lease occurs other
than on the first day or the last day of a calendar month, the Rent for such
month shall be prorated. This Lease is what is commonly called a "net lease," it
being understood that Landlord shall receive the Rent free and clear of any and
all impositions, taxes, liens, charges or expenses of any nature or kind
whatsoever in connection with the ownership and operation of the Premises,
including reimbursement of an asset management fee equal to two percent (2%) of
the Rent. If Rent is not received as provided above, a late charge shall be
payable by Xxxxxx as provided in Paragraph 13.4. In the event that a late charge
is payable, whether or not collected, two times in any twelve month period, then
Rent shall automatically become due and payable quarterly in advance, rather
than monthly.
5. Deposits.
5.1 Taxes, Insurance and Maintenance Reserve. Tenant shall deposit with
Landlord each month the amount set forth in Paragraph I as a reserve to be used
to pay real property taxes, maintenance expenses and insurance expenses on the
Premises which are payable by Tenant under the terms of this Lease. If the
amounts deposited with Landlord by Tenant under the provisions of this Paragraph
are insufficient to discharge the obligations of Tenant, Tenant shall send to
Landlord, upon Landlord's demand, the additional sums necessary to fully satisfy
such obligations. All monies deposited with Landlord under this Paragraph may be
intermingled with other moneys of Landlord and shall not bear interest.
5.2 Security Deposit. Tenant has deposited with Landlord the Security Deposit
set forth in Paragraph 1 above as security for Xxxxxx's faithful performance of
Xxxxxx's obligations hereunder. If Tenant fails to pay Rent or other charges due
hereunder, or otherwise defaults with respect to any provision of this Lease,
Landlord may use, apply or retain all or any portion of said deposit for the
payment of any Rent or other charge in default or for the payment of any other
sum to which Landlord may become obligated by reason of Tenant's default, or to
compensate Landlord for any loss or damage which Landlord may suffer thereby. If
Landlord so uses or applies all or any portion of said deposit, Tenant shall
within ten (10) days after written demand therefor deposit cash with Landlord in
an amount sufficient to restore said deposit to the full amount stated in
Paragraph 1 and Tenant's failure to do so shall be a material breach of this
Lease. Landlord shall not be required to keep said deposit separate from its
general accounts. If Xxxxxx performs all of Tenant's obligations hereunder, said
deposit, or so much thereof as has not theretofore been applied by Landlord,
shall be returned, without payment of interest or other increment for its use,
to Tenant (or, at Landlord's option, to the last assignee, if any, of Xxxxxx's
interest hereunder) at the expiration of the Term hereof, and after Xxxxxx has
vacated the Premises. No trust relationship is created herein between Landlord
and Tenant with respect to said Security Deposit.
6. Use.
6.1 Use. The Premises shall be used and occupied only for the uses
stated in Paragraph 1.
6.2 Compliance with Law; Prior Restriction. Tenant shall, at Tenant's sole
expense, comply promptly and continuously with all applicable statutes,
ordinances, rules, regulations, orders, restrictions of record, and requirements
in effect during the Term or any part of the Term hereof regulating the use of
the Premises. Tenant shall not use or permit the use of the Premises in any
manner that will tend to create waste or a nuisance. Permanent outside storage
shall not be allow without prior written approval from Landlord.
6.3 Conditions of Premises. Tenant hereby accepts the Premises in their
condition existing as of the date of the execution hereof, except for those
specific improvements which Landlord has undertaken to provide in Paragraph 3
and subject to all applicable zoning, municipal, county and state laws,
ordinance and regulations and any covenants or restrictions of record governing
and regulating the use of the Premises, and accepts this Lease subject thereto
and to matters disclosed thereby and by any exhibits attached hereto. Tenant
acknowledges that neither Landlord nor Landlord's agent has made any
representation warranty as to the suitability of the Premises for the conduct of
Tenants business, and that Tenant has made such legal and factual inquiries with
respect thereto it deems appropriate and has relied solely thereon.
6.4 Hazardous Materials. Tenant shall not cause any hazardous wastes,
chemicals or materials (collectively "Hazardous Materials") to be used,
generated, stored or disposed of on or about the Premises except with Xxxxxxxx's
written permission and in strict compliance with all applicable regulations and
using all necessary and appropriate precautions. Xxxxxxxx's permission may be
withheld for any reason and may be revoked at any time. Tenant shall be liable
to Landlord for any and all damages caused by Tenants failure to keep, store,
use, maintain or handle Hazardous Materials on the Premises. Landlord shall not
be liable to Tenant for any claims, damages or losses due to the effects of
Hazardous Materials on the Premises that is caused by owners, tenants,
licensees, and invitees of other properties or is not directly caused by
Landlord. Landlord shall not be liable to Tenant regardless of whether or not
Landlord has approved Tenants activities. Tenant shall indemnify, defend by
counsel acceptable to Landlord and hold Landlord harmless from and against any
claims, damages or liabilities arising out of a breach of any provision of this
Paragraph 6.4.
7. Maintenance, Repairs And Alterations
7.1 Tenant's Obligations. Subject to Paragraph 7.4 below, Tenant shall keep
in good order, condition and repair, the Premises and every part thereof,
structural and non-structural, and all adjacent sidewalks, landscaping,
driveways, parking lots, and fences located in the areas which are adjacent to
and included with the Premises. At the cost and expense of Tenant, the
landscaping shall be maintained by a professional gardener and the exterior of
the building shall be repainted at least once every four (4) years.
7.2 Surrender. On the last day of the Term hereof, or on any sooner
termination, Tenant shall surrender the Premises to Landlord in the same
condition as when received, ordinary wear and tear excepted, clean and free of
debris. Tenant shall repair any damage to the Premises occasioned by the removal
of Xxxxxx's trade fixtures, furnishings and equipment. Tenant shall leave the
air lines, power panels, electrical distribution systems, lighting fixtures,
space heaters, air conditioning, plumbing and fencing on the Premises in good
operating condition.
7.3 Landlord Rights. If Tenant fails to perform Tenant's obligations under
this Paragraph 7, or under any other paragraph of this Lease, Landlord may, at
its option (but shall not be required to), enter upon the Premises, after ten
(10) days' prior written notice to Tenant (except in the case of an emergency,
in which case no notice shall be required), perform such obligations on Tenant's
behalf and put the same in good order, condition and repair, and the cost
thereof shall become due and payable as additional rent to Landlord together
with Xxxxxx's next rent installment.
7.4 Landlord's Obligations. Except for the repair of any latent
construction defects in the structural bearing elements of the building and the
obligations of Landlord under Paragraph 9 and 14, it is intended by the parties
hereto that Landlord shall have no obligation, in any manner whatsoever, to
repair and maintain the Premises nor the equipment therein, whether structural
or non-structural, all of which obligations are intended to be that of the
Tenant. Tenant hereby waives the provisions of California Civil Code Section
1941 and 1942 or any related or successor provision of law which would otherwise
afford Tenant the right to make repairs at Landlord's expense or to terminate
this Lease because of Landlord's failure to keep the Premises in good order,
condition and repair.
7.5 Alterations and Additions.
(a) Tenant shall not without Landlord's prior written consent, make any
alterations, improvements, additions or Utility Installations which for
non-structural alterations and utility installations shall not be unreasonably
withheld in, on or about the Premises, except for non-structural alterations not
exceeding ten thousand dollars ($10,000) during the Term of this Lease. As used
in this paragraph 7.5, the term "Utility Installations" shall include carpeting,
window coverings, air lines, power panels, electrical distribution systems,
lighting fixtures, space heaters, air-conditioning, plumbing, and fencing.
Landlord may require that Tenant remove any or all of said alterations,
improvements, additions or Utility Installations at the expiration of the Term,
and restore the Premises to their prior condition. Landlord may require Tenant
to provide Landlord, at Tenant's sole cost and expense, a lien and completion
bond in an amount equal to one and one-half times the estimated cost of such
improvements, to insure Landlord against any liability for mechanic's and
materialmen's liens and to insure completion of work. Should Tenant make any
alterations, improvements, additions or Utility Installations without the prior
approval of Landlord, Landlord may require that Tenant remove any or all of the
same
(b) Any alterations, improvements, additions or Utility Installations
in, or about the Premises that Tenant shall desire to make and which require the
consent of the Landlord shall be presented to Landlord in written form, with
proposed detailed plans. If Landlord shall give its consent, the consent shall
be deemed conditioned upon Tenant acquiring a permit to do so from appropriate
governmental agencies, the furnishing of a copy thereof to Landlord prior to the
commencement of the work, and the compliance by Tenant with all conditions of
said permit in a prompt and expeditious manner.
(c) Tenant shall pay, when due, all claims for labor or materials
furnished or alleged to have been furnished to or for Tenant at or for use in
the Premises, which claims are or may be secured by any mechanic's or
materialmen's lien against the Premises or any interest therein. Tenant shall
give Landlord not less than ten (10) days' notice prior to the commencement of
any work in or on the Premises, and Landlord shall have the right to post
notices of non-responsibility in or on the Premises as provided by law.
(d) Unless Landlord requires their removal, as set forth in Paragraph
7.5(a), all alterations, improvements, additions and Utility Installations
(whether or not such Utility Installations constitute trade fixtures of Tenant),
which may be made on the Premises, shall become the property of Landlord and
remain upon and be surrendered with the Premises at the expiration of the Term.
Notwithstanding the provisions of this Paragraph 7.5(d), Tenant's machinery and
equipment, other than that which is affixed to the Premises so that it cannot be
removed without material damage to the Premises, shall remain the property of
Tenant and may be removed by Tenant subject to the provisions of Paragraph 7.2.
7.6 Common Area Maintenance. In the event that the Premises are a portion
of a larger building or complex, Landlord, at Landlord's option, may arrange for
any portion of the exterior or common area maintenance and repair. Tenant shall
pay to Landlord upon demand a reasonable proportion to be determined by Landlord
of all costs including a ten percent (10%) administration fee on landscaping,
irrigation and exterior lighting charges in the event Landlord administrates the
same.
8. lnsurance, Indemnity.
8.1 Coverage. The following insurance and any additional insurance coverage
that maybe required bylaw, holders of mortgages or deeds of trust shall be
carried protecting Landlord and the holders of any mortgages or deeds of trust
covering the Premises. Any insurance policies provided by Tenant shall provide
that such policies are primary and non-contributing with any insurance carried
by the Landlord.
(a) Insurance covering loss or damage to the Premises in the amount of
the full replacement value thereof, as the same may exist from time to time, but
in no event less than the total amount required by lenders having liens on the
Premises, against all perils included within the classification of fire,
extended coverage, vandalism, malicious mischief, and special extended perils
("all risk" as such term is used in the insurance industry). Said insurance
shall provide for payment of loss thereunder to Landlord or to the holders of
mortgages or deeds of trust on the Premises. A stipulated value or agreed amount
endorsement deleting the co-insurance provision of the policy shall be procured
with said insurance. If such insurance coverage has a deductible clause, the
deductible amount: shall not exceed $5,000 per occurrence, and Tenant shall be
liable for such deductible amount.
(b) Comprehensive general liability (Xxxxxxxx's risk only including
without limitation bodily injury, personal injury and property damage insurance)
in the amount of six million dollars or such higher limits as Landlord may
reasonably require.
(c) Insurance against abatement or loss of rent in case of fire or
other casualty in an amount equal to the Rent, Real Property Taxes, and
insurance premium payments to be made by Tenant during one (1) year; and
(d) Comprehensive public liability insurance (including without
limitation bodily injury, personal injury and property damage insurance), with
limits at least as high as the amounts respectively stated in Paragraph 1, or
such higher limits as Landlord may reasonably require.
8.2 Payment of Premiums. Tenant shall obtain the insurance policy called
for in Paragraph 8.1(d). Landlord shall obtain the insurance policies called for
in Paragraphs 8.1(a), (b), and (c) and Tenant shall pay the cost thereof to the
extent not prepaid through reserves paid pursuant to Paragraph 5.1 upon demand
as additional rent. However, if the Premises are a one-tenant building and
Tenant can provide suitable insurance at lesser cost within thirty (30) days
-after notice of the company and rate obtained by Landlord; Tenant may do so and
shall not be liable to Landlord for any cost of temporary insurance in excess of
the rate for substitute insurance. If tenant fails to maintain insurance which
Tenant has undertaken to provide, Tenant shall pay for any loss or cost
resulting from said failure.
8.3 Insurance Policies. Insurance required hereunder shall be with
companies holding a Bests Insurance Guide "General Policyholders Rating" of at
le and a "Financial Size Category" rating of at least Class VIII. Insurance
policies shall not be cancelable or subject to reduction in coverage or other
modification except after thirty (30) days' prior written notice to Landlord.
The insuring party shall deposit with such mortgage holders as Landlord may
require, p duplicates or certificates as such holders may require, and shall in
all cases furnish the other party with policies, duplicates and certificates.
Tenant shall not or permit to be violated any of the conditions or provisions of
any policy provided for in Paragraph 8.1, and Tenant shall so perform and
satisfy the requirement the companies writing such policies so that at all times
companies of good standing reasonably satisfactory to Landlord shall be willing
to write and/or continue insurance.
8.4 Waiver of Subrogation. Tenant and Landlord each hereby release the
other, and waive their entire right of recovery against the other for I damage
arising out of or incident to the perils insured against hereunder, whether due
to the negligence of Tenant or Landlord or their agents, employees, contractors
and/or invitees. Tenant and Landlord shall, upon obtaining the polices of
insurance required hereunder, give notice to the Insurance carriers the
foregoing mutual waiver of subrogation is contained in this Lease.
8.5 Indemnity. Tenant shall indemnify and hold harmless Landlord from and
against any and all claims arising from Tenant's use of the Premises, or from
the conduct of Tenant's business or from any activity, work or things done,
permitted or suffered by Tenant in or about the Premises or elsewhere and shall
further indemnify and hold harmless Landlord from and against any and all claims
arising from any breach or default in the performance of any obligation on
Tenant's part to be performed under the terms of this Lease, or arising from any
negligence of Tenant, or any of Tenant's agents, contractors, or employees, and
from and against all costs, attorneys' fees, expenses and liabilities incurred
in the defense of any such claim or any action or proceeding brought thereon;
and in case any action or proceeding be brought against Landlord by reason of
any such claim, Tenant upon notice from Landlord shall defend the same at
Tenants expense by counsel satisfactory to Landlord. Tenant as a material part
of the consideration to Landlord hereby assumes all risk of damage to property
or injury to persons, in, upon or about the Premises arising from any cause and
Tenant hereby waives all claims in respect thereof against Landlord.
8.6 Exemption of Landlord from Liability. Tenant hereby agrees that
Landlord shall not be liable for injury to Xxxxxx's business or any loss of
income therefrom or for damage to the goods, wares, merchandise or other
property of Tenant, Tenants employees, invitees, customers, or any other person
in or about the Premises; nor shall Landlord be liable for injury to the person
of Tenant, Tenant's employees, agents or contractors, whether such damage or
injury is caused by or results from fire, steam, electricity, gas, water or
rain, or from the breakage, leakage, obstruction or other defects of pipes,
sprinklers, wires, appliances, plumbing, air conditioning or lighting fixtures,
or from any other cause, whether said damage or injury results from conditions
arising upon the Premises or upon other portions of the building of which the
Premises are a part, or from other sources or places, and regardless of whether
the cause of such damage or injury or the means of repairing same is
inaccessible to Tenant. Landlord shall not be liable for any damages arising
from any act or neglect of any other tenant, if any, of the building in which
the Premises are located.
9. Damage or Destruction. See Paragraph 47.
9.1 Partial Damage - Insured. Subject to the provisions of Paragraphs 9.3
and 9.4, if the Premises are damaged and such damage was Caused by a casualty
covered under an insurance policy, Landlord shall repair such damage as soon as
reasonably possible and this Lease shall continue in full force and effect. If
the insurance proceeds received by Landlord are not sufficient to effect such
repair and such insufficiency is not due to an insufficient policy coverage
amount, Tenant shall pay to Landlord upon demand any costs incurred by Landlord
not fully covered by insurance proceeds. If Tenant repairs the damage, Landlord
shall reimburse Tenant for the costs of repair to the extent of insurance
proceeds received by Landlord.
9.2 Partial Damage - Uninsured. Subject to the provisions of Paragraphs 9.3
and 9.4, if the Premises are damaged where the cost to repair such damage
exceeds $25,000 except by a negligent or willful act of Tenant (in which event
Tenant shall make the repairs at its expense), and such damage was caused by a
casualty not covered under an insurance policy required to be maintained
pursuant to Paragraph 8.1, Landlord may at Landlord's option either (i) repair
such damage as soon as reasonably possible at Landlord's expense, in which event
this Lease shall continue in full force and effect, or (ii) give written notice
to Tenant within thirty (30) days after the date of the occurrence of such
damage of Landlord's intention to cancel and terminate this Lease as of the date
of the occurrence of such damage. In the event Landlord elects to give such
notice of Landlord's intention to cancel and terminate this Lease, Tenant shall
have the right within ten (10) days after the receipt of such notice to give
written notice to Landlord of Tenant's intention to repair such damage at
Tenant's expense, without reimbursement from Landlord, in which event this Lease
shall continue in full force and effect, and Tenant shall proceed to make such
repairs as soon as reasonably possible. If Tenant does not give such notice
within such ten (10) day period, this Lease shall be canceled and terminated as
of the date of the occurrence of such damage.
9.3 Total Destruction. If at any time during the Term of this Lease there
is damage, whether or not an insured loss, (including destruction required by
any authorized public authority) to the building of which the Premises are a
part to the extent that the cost of repair exceeds fifty percent (50%) of the
then replacement cost of such building as a whole, then this Lease shall
automatically terminate as of the date of such destruction.
9.4 Damage Near End of Term. If the Premises are significantly damaged
during the last year of the Term of this Lease, Landlord may at Landlord's
option cancel and terminate this Lease as of the date of occurrence of such
damage by giving written notice to Tenant of Landlord's election to do so within
thirty (30) days after the date of occurrence of such damage.
9.5 Abatement of Rent. In the event of damage described in Paragraphs 9.1
or 9.2, and Landlord or Tenant repairs or restores the Premises, Rent for the
period during which such damage, repair or restoration continues shall be abated
in proportion to the degree to which Xxxxxx's use of the Premises is impaired,
but only to the extent of any proceeds received by Landlord from rental
abatement insurance described in Paragraph 8.1. Except for the abatement of
Rent, if any, Tenant shall have no claim against Landlord for any damage
suffered by reason of any such damage, destruction, repair or restoration.
9.6 Waiver. Tenant and Landlord hereby waive the provisions of California
Civil Code Paragraphs 1932 (2) and 1933 (4) or any related or successor
provision of law which relate to termination of leases when the thing leased is
destroyed and agree that such event shall be governed by the terms of this
Lease.
10. Real Property Taxes.
10.1 Payment of Taxes. Tenant shall pay the Real Property Tax, as defined
in Paragraph 10.2, applicable to the Premises during the Term. 11' deposits
collected for real property taxes as provided in Paragraph 5.1 are not
sufficient to discharge the Tenant's obligations, payment of the balance shall
be made at least ten (10) days prior to the delinquency date of such payment by
depositing the payment with Landlord. If any such taxes paid by Tenant shall
cover any period of time after the expiration of the Term hereof, Xxxxxx's share
of such taxes shall be equitably prorated to cover only the period of time
within the tax fiscal Year during which this Lease shall be in effect, and
Landlord shall reimburse Tenant to the extent required within thirty (30) days
following expiration of the Term. If Tenant shall fail to pay any such taxes,
Landlord shall have the right to pay the same, in which case Tenant shall repay
such amount to Landlord with Tenant's next rent installment together with
interest at the rate of twelve percent (12%) per annum.
10.2 Definition of "Real Property Tax". As used herein, the term Real
Property Tax shall include any form of real estate tax or assessment, general,
special, ordinary or extraordinary, and any license fee, commercial rental tax,
improvement bond or bonds, levy or tax (other than inheritance, personal income
or estate taxes) imposed on the Premises by any authority having the direct or
indirect power to tax, including any city, state or federal government, or any
school, agricultural, sanitary, fire, street, drainage or other improvement
district thereof, as against any legal or equitable interest of Landlord in the
Premises or in the real property of which the Premises are a part, as against
Landlord's right to rent or other income therefrom, and as against Landlord's
business of leasing the Premises. Real Property Tax shall also include any tax,
fee, levy, assessment or charge (i) in substitution of, partially or totally,
any tax, fee, levy assessment or charge hereinabove included within the
definition of Real Property Tax or (ii) the nature of which was hereinbefore
included within the definition of Real Property Tax.
10.3 Joint Assessment. If the Premises are not separately assessed,
Xxxxxx's liability shall be an equitable proportion of the Real Property Taxes
for all of the land and improvements included within the tax parcel assessed,
such proportion to be determined by Landlord from the respective valuations
assigned in the assessor's work sheets or such other information as may be
reasonably available.
11. Utilities. Tenant shall pay for water, gas, electricity, and any other
utilities and services supplied to the Premises together with taxes thereon.
Tenant shall be responsible for any installation or hook-up charge. Landlord
shall not be liable to Tenant for interruption in or curtailment of any utility
service, nor shall any such interruption in or curtailment constitute a
constructive eviction or grounds for rental abatement. If any such services are
not separately metered to Tenant, Tenant shall pay a reasonable proportion to be
determined by Landlord of all charges jointly metered with other premises.
12. Assignment and Subletting.
12.1 Landlord's Consent Required. Tenant shall not voluntarily or by
operation of law assign, mortgage, sublet, or otherwise transfer or encumber all
or any part of Tenant's interest in this Lease or in the Premises without
Landlord's prior written consent. Landlord shall not unreasonably withhold its
consent to an to an assignment or sublet, provided the proposed assignee or
sublessee is reasonably satisfactory to Landlord as to credit and will occupy
and use the Premises for the same purposes specified in Paragraph 1. Any
attempted assignment, transfer, mortgage, encumbrance or subletting without such
consent shall constitute a breach of this Lease and be voidable at Landlord's
election. Tenant shall pay to Landlord five hundred dollars ($500) as
compensation for expenses in connection with any request for landlords consent
by Xxxxxx.
12.2 No Release of Tenant. Regardless of Landlord's consent, no subletting or
assignment shall release Tenant of Tenant's obligation or alter the primary
liability of Tenant to pay the Rent and to perform all other obligations to be
performed by Tenant hereunder. The acceptance of Rent by Landlord from any
liability of Tenant to pay the Rent and to perform all other obligations to pay
the rent or subletting shall not be deemed consent to any subsequent assignment
or subletting.
12.3 Recapture of Premises. In connection with any proposed assignment or
sublease of the entire premises, Tenant shall submit to landlord in writing (a)
the name of the proposed assignee or sublessee, (b) such information as to its
financial responsibility a hall have an option to cancel and terminate this
Lease with respect to the Premises which is to be assigned or sublet. Landlord
may exercise said option in writing within thirty (30) days after its receipt
from Tenant of such request to assign or sublease the Premises. If Landlord
shall exercise its option, Xxxxxx shall surrender possession of the entire
Premises,
12.4 Excess Sublease Rental. If, on account of or in connection with any
assignment or sublease if more than 5O% of the Premises, tenant receives rent or
other consideration in excess of the Rent called for hereunder, or in the case
of the sublease of a portion of the Premises, in excess of the pro rata Rent
based on the floor area of such portion, after appropriate adjustments to assure
all other payments called for hereunder are appropriately taken into account,
Tenant shall pay to Landlord Fifty Percent (50%) of the excess of such payment
of rent or other consideration received by Tenant promptly after its receipt.
13. Defaults; Remedies.
13.1 Defaults. The occurrence of any one or more of the following events
shall constitute a material default and breach of this Lease by Tenant:
(a) The vacating or abandonment of the Premises by Tenant for at least
thirty (30) days.
(b) The failure by Tenant to make any payment of Rent or any other
payment required to be made by Tenant hereunder, as and when due, where such
failure shall continue for a period of three (3) days after written notice
thereof from Landlord to Tenant.
(c) The failure by Tenant to observe or perform any of the covenants,
conditions or provisions of this Lease to be observed or performed by Xxxxxx,
other than described in Paragraph 13.1(b), where such failure shall continue for
a period of thirty (30) days after written notice thereof from Landlord to
Tenant; provided, however, that if the nature of Tenant's default is such that
more than thirty (30) days are reasonably required for its cure, then Tenant
shall not be deemed to be in default if Tenant commences such cure within said
thirty (30) day period and thereafter diligently prosecutes such cure to
completion.
(d)(i) The making by Tenant of any general arrangement or assignment
for the benefit of creditors; (ii) the filing by or against Tenant of a petition
to have Tenant adjudged bankrupt or a petition for reorganization or arrangement
under any law relating to bankruptcy (unless the same is dismissed within sixty
(60) days); (iii) the appointment of a trustee or receiver to take possession of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where possession is not restored to Tenant within thirty
(30) days; or (iv) the attachment, execution or other judicial seizure of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where such seizure is not discharged within thirty (30)
days.
(e) The discovery by Landlord that any financial statement given to
Landlord by Xxxxxx, any assignee of Tenant, any subtenant of Tenant, any
successor in interest or any guarantor of Tenant's obligations hereunder was
materially false.
13.2 Remedies. In the event of any material default or breach by Tenant,
Landlord may at any time thereafter, with or without notice or demand and
without limiting Landlord in the exercise of any right or remedy which Landlord
may have by reason of such default or breach:
(a) Terminate Xxxxxx's right to possession of the Premises, in which
case this Lease shall terminate and Tenant shall immediately surrender
possession of the Premises to Landlord. In such event, Landlord shall be
entitled to recover from Tenant all damages incurred by Landlord by reason of
Tenant's default including, but not limited to, the cost of recovering
possession of the Premises; expenses of reletting including necessary renovation
of the Premises, reasonable attorneys' fees, and any real estate commission
actually paid; the worth at the time of award by the court having jurisdiction
thereof of the amount by Which the unpaid Rent for the balance of the Term after
the time of such award exceeds the amount of such rental loss for the same
period that Tenant proves could be reasonably avoided; and that portion of the
leasing commission paid by Landlord applicable to the unexpired Term of this
Lease. Unpaid installments of Rent or other sums shall bear interest at the rate
of twelve percent (12%) per annum.
(b) Maintain Tenant's right to possession in which case this Lease
shall continue in effect whether or not Tenant shall have abandoned the
Premises. In such event, Landlord shall be entitled to enforce all of Landlord's
rights and remedies under this Lease, including the right to recover the Rent as
it becomes due hereunder.
(c) Pursue any other remedy now or hereafter available to Landlord
under the laws or judicial decisions of the State of California.
13.3 Default by Landlord. Landlord shall not be in default unless Landlord
fails to perform obligations required of Landlord within thirty (30) clays after
written notice by Tenant to Landlord and to the holder of any mortgage or deed
of trust covering the Premises whose name and address shall have theretofore
been furnished to Tenant in writing, specifying wherein Landlord has failed to
perform such obligations; provided, however, that if the nature of Landlord's
obligation is such that more than thirty (30) days are required for performance,
then Landlord shall not be in default if Landlord commences performance within
such thirty (30) day period and thereafter diligently prosecutes the same to
completion.
13.4 Late Charges. Tenant hereby acknowledges that late payment by Tenant
to Landlord of Rent and other sums due hereunder will cause Landlord to incur
costs not contemplated by this Lease, the exact amount of which will be
extremely difficult to ascertain. Such costs include, but are not limited to,
processing and accounting charges, and late charges which may be imposed on
Landlord by the terms of any mortgage or trust deed covering the Premises.
Accordingly, if any installment of Rent or any other sum due from Tenant shall
not be received by Landlord or Landlord's designee within five (5) business days
after such amount shall be due, then, without any requirement for notice to
Tenant, Tenant shall pay to Landlord a late charge equal to five percent (5%) of
such overdue amount. The parties hereby agree that such late charge represents a
fair and reasonable estimate of the costs Landlord will incur by reason of late
payment by Xxxxxx. Acceptance of such late charge by Landlord shall in no event
constitute a waiver of Tenant's default with respect to such overdue amount, nor
prevent Landlord from exercising any of the other rights and remedies granted
hereunder.
14. Condemnation. If the Premises or any portion thereof are taken under the
power of eminent domain, or sold under the threat of the exercise of said power
(all of which are herein called "Condemnation"), this Lease shall terminate as
to the part so taken as of the date the condemning authority takes title or
possession, whichever first occurs. If more than ten percent (10%) of the floor
area of the building on the Premises or more than twenty- five percent (25%) of
the land area of the Premises which is not occupied by any building is taken by
Condemnation; then Tenant may, at Tenant's option to be exercised in writing
only within ten (10) days after Landlord shall have given Tenant written notice
of such taking (or in the absence of such notice, within ten (10) days after the
condemning authority shall have taken possession), terminate this Lease as of
the date the condemning authority takes such possession. If Tenant does not
terminate this Lease in accordance with the foregoing, this Lease shall remain
in full force and effect as to the portion of the Premises remaining, except
that the Rent shall be reduced in the proportion that the floor area taken bears
to the total floor area of the building situated on the Premises. No reduction
in Rent shall occur if the only area taken is that which does not have a
building located thereon. Any award for the taking of all or any part of the
Premises under the power of eminent domain or any payment made under threat of
the exercise of such power shall be the property of Landlord, whether such award
shall be made as compensation for diminution in value of the leasehold or for
the taking of the fee, or as severance damages; provided, however, that Tenant
shall be entitled to any award for loss or damage to Tenant's trade fixtures and
removable personal property. In the event that this Lease is not terminated by
reason of such Condemnation, Landlord shall, to the extent of severance damages
received by Landlord in connection with such Condemnation, repair any damage to
the Premises caused by such Condemnation except to the extent that Xxxxxx has
been reimbursed therefor by the condemning authority.
15. Examination of Lease. Submission of this instrument for examination or
signature by Xxxxxx does not constitute a reservation of or option to lease.
This instrument is not effective as a lease or otherwise until execution and
delivery by Landlord and Tenant.
16. Estoppel Certificate.
(a) Tenant shall, upon ten (10) days prior written notice from Landlord
execute, acknowledge and deliver to Landlord a statement in writing (i)
certifying that this Lease is unmodified and in full force and effect (or, if
modified, stating the nature of such modification and certifying that this
Lease, as so modified, is in full force and effect) and the date to which the
Rent and other charges are paid in advance, if any, and (ii) acknowledging that
there are not, to Xxxxxx's knowledge, any uncured defaults on the part of
Landlord hereunder, or specifying such defaults if any are claimed. Any such
statement may be conclusively relied upon by any prospective purchaser or
encumbrancer of the Premises.
(b) At Landlord's option, Tenants failure to deliver such statement within
ten (10) days of receipt of written notice shall be a material breach of this
Lease or shall be conclusive upon Tenant (i) that this Lease is in full force
and effect, without modification except as may be represented by Landlord, (ii)
that there are no uncured defaults in Landlord's performance, and (iii) that not
more than one month's Rent has been paid in advance.
(c) If Landlord desires to finance, refinance or sell the Premises, or any
part thereof, Tenant hereby agrees upon ten (10) days prior written notice
to deliver to Landlord such financial statements of Tenant as may be
reasonably required by a lender or
purchaser. Such statement shall include the most recent three years'
financial statements of Tenant. All such financial statements
shall be received by Landlord in confidence and shall be used
only for the purposes herein set forth.
17. Landlord's Liability. Whenever Landlord conveys its interest in the
Premises, Landlord shall be automatically released from all liability as
respects the performance of covenants on the part of Landlord herein contained
provided the assignee executes an assumption agreement expressly agreeing to
assume Xxxxxxxx's obligations with respect to this Lease. If requested, Xxxxxx
shall execute a form of release and such other documentation as may be required
to effect these provisions. Xxxxxx agrees to look solely to Xxxxxxxx's estate
and interest in the Premises for the satisfaction of any liability, duty or
obligation of Landlord in respect to this Lease or the relationship of Landlord
and Tenant hereunder and no other assets of Landlord shall be subject to any
liability therefor. Xxxxxx agrees it will not seek and hereby waives any
recourse against the individual partners, directors, officers, employees or
shareholders of Landlord or their personal assets for such satisfaction.
18. Severability. The invalidity of any provision of this Lease as determined by
a court of competent jurisdiction shall in no way affect the validity of any
other provision hereof.
19. Interest on Past-Due Obligations. Except as expressly herein provided, any
amount due to Landlord not paid when due shall bear interest at the twelve
percent (12%) per annum. Payment of such interest shall not excuse or cure any
default by Tenant.
20. Time of Essence. Time is of the essence.
21. Additional Rent. Any monetary obligations of Tenant to Landlord under the
terms of this Lease shall be deemed to be rent.
22. Incorporation of Prior Agreements; Amendments. This Lease contains all
agreements of the parties with respect to any matter mentioned herein. No prior
agreement or understanding pertaining to any such matter shall be effective.
This Lease may be modified in writing only, signed by the parties in interest at
the time of the modification.
23. Notices. Any notice required or permitted to be given hereunder shall be in
writing and may be given by personal service or by certified mail, return
receipt requested. Notice by certified mail shall be deemed served on the date
of delivery as shown on the postal receipt. Either party may by notice to the
other specify a different address for notice purposes, except that, upon
Xxxxxx's taking possession of the Premises, the Premises shall constitute
Tenants address for notice purposes. A copy of all notices to be given to
Landlord hereunder shall be concurrently transmitted by Tenant to such party or
parties at such addresses as Landlord may hereafter designate by notice to
Tenant.
24. Waivers. No waiver by Landlord of any provision hereof shall be deemed a
waiver of any other provision hereof or of any subsequent breach by Tenant of
the same or any other provision. Xxxxxxxx's consent to or approval of any act
shall not be deemed to render unnecessary the obtaining of Landlord's consent to
or approval of any subsequent act by Xxxxxx. The acceptance of Rent hereunder by
Landlord shall not be a waiver of any preceding breach by Tenant or of any
provision hereof, other than the failure of Tenant to pay the particular Rent so
accepted, regardless of Landlord's knowledge of such preceding breach at the
time of acceptance of such Rent. Partial or incomplete payments accepted by
Landlord shall not be a waiver or considered an accord and satisfaction of any
amounts due.
25. Captions. Paragraph captions are not a part hereof.
26. Holding Over. If Tenant remains in possession of the Premises or any part
thereof after the expiration of the Term without the express written consent of
Landlord, such occupancy shall be a tenancy from month to month at a rental
equal to the Rent during the last month of the Term increased by twenty percent
(20%) and upon all the terms hereof applicable to a month-to-month tenancy.
27. Cumulative Remedies. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other remedies at
law or in equity.
28. Covenants and Conditions. Each provision of this Lease performable by Tenant
shall be deemed both a covenant and a condition.
29. Binding Effect; Choice of Law. Subject to the provisions of Paragraphs 12
and 17, this Lease shall be binding upon and inure to the benefit of the parties
hereto and their respective successors, assigns and legal representatives. This
Lease shall be governed by the laws of the State of California.
30. Subordination.
(a) This Lease, at Landlord's option, shall be subordinate to any ground
lease, mortgage, deed of trust, or any other hypothecation or security now or
hereafter placed upon the real property of which the Premises are a part and to
any and all advances made on the security thereof and to all renewals,
modifications, consolidations, replacements and extensions thereof. Xxxxxxxx's
election to subordinate this Lease shall not be effective unless the ground
lessor, mortgagee or trustee shall execute with Tenant a nondisturbance
agreement recognizing that Tenant's eight to quiet possession of the Premises
shall not be disturbed if Tenant is not in default and so long as Tenant shall
pay the Rent and observe and perform all the provisions of this Lease. If any
mortgagee, trustee or ground lessor shall elect to have this Lease prior to the
lien of its mortgage, deed of trust or ground lease, and shall give written
notice thereof to Tenant, this Lease shall be deemed prior to such mortgage,
deed of trust, or ground lease, whether this Lease is dated prior or subsequent
to the date of said mortgage, deed of trust or ground lease or the date of
recording thereof.
(b) Xxxxxx agrees to execute any documents required to effectuate an
attornment, a subordination or to make this Lease prior to the lien of any
mortgage, deed of trust or ground lease, as the case may be. Tenant's failure to
execute such documents within ten (10) days after written demand shall
constitute a default by Tenant hereunder, or at Landlord's option, Landlord
shall execute such documents on behalf of Tenant as Xxxxxx's attorney-in-fact.
Tenant does hereby make, constitute and irrevocably appoint Landlord as Tenants
attorney-in-fact and in Tenants name, place and stead to execute such documents.
31. Attorney's Fees. If Landlord or Xxxxxx brings an action to enforce its
respective rights hereunder, the unsuccessful party therein agrees to pay all
costs incurred by the prevailing party therein, including reasonable attorney's
fees and court costs to be fixed by the court.
32. Landlord's Access. Landlord and Landlord's agents shall have the right to
enter the Premises at reasonable times for the purpose of inspecting the same,
showing the same to prospective purchasers, lenders, or tenants, and making such
alterations, repairs, improvements or additions to the Premises or to the
building of which they are a part as Landlord may deem necessary or desirable.
Landlord may at any time during the last one hundred twenty (120) days of the
Term hereof place on or about the Premises any ordinary "For Sale" or "For
Lease" signs, all without rebate of Rent or liability to Tenant.
33. Auctions. Tenant shall not conduct any auction without Landlord's prior
written consent.
34. Signs. Any sign placed on the Premises shall contain only Tenant's name and
slogan for the name of any affiliate of Tenant actually occupying the Premises,
but no advertising matter. No such sign shall be erected until Tenant has
obtained Landlord's written approval which shall not unreasonably be withheld of
the location, materials, size, design, and content thereof and any necessary
permit therefor. Tenant shall remove any such sign upon termination and return
the Premises to their condition prior to the placement of said sign.
35. Merger. The voluntary or other surrender of this Lease by Tenant, or a
mutual cancellation thereof, or a termination by Landlord, shall not work a
merger and shall at the option of the Landlord, terminate all or any existing
subtenancies or may, at the option of Landlord, operate as an assignment to
Landlord of any or all of such tenancies.
36. Easements, Boundary Changes. Landlord reserves to itself the right, from
time to time, to grant such easements, rights, dedications and enact boundary
and common area configuration adjustments that Landlord deems necessary or
desirable and to cause the recordation of parcel maps and restrictions, so long
as they do not unreasonably interfere with the use of the Premises by Xxxxxx.
Tenant shall sign any of the aforementioned documents upon request of Landlord
and failure to do so shall constitute a breach of this Lease by Xxxxxx.
37. Quiet Possession. Upon Xxxxxx's paying the Rent, additional rent and other
sums provided hereunder and observing and performing all of the covenants,
conditions and provisions on Tenants part to be observed and performed
hereunder, Tenant shall have quiet possession of the Premises for the entire
Term hereof, subject to the provisions of this Lease.
38. Authority. If Tenant is a corporation, trust or partnership, each individual
executing this Lease on behalf of such entity represents and warrants that he is
duly authorized to execute and deliver this Lease on behalf of said entity. If
Tenant is a corporation, trust or partnership, Tenant shall, within thirty (30)
days after execution of this Lease, deliver evidence of such authority to
Landlord.
See Addendum for Paragraphs 39 through 47.
The parties hereto have executed this lease on the dates immediately above
their respective signatures.
Dated: 2/25/00 Dated:
Xxxxxx Beverage Company 43 Railroad Partnership L.P.
A Delaware corporation a California Limited Partnership
By: /s/ Xxxxxx Xxxxx By: Investment Building Group
Its: /s/ Chairman a California corporation
General partner
By: /s/ Xxxx X. Xxxxxxx
Xxxx X. Xxxxxxx,
President
"Tenant" "Landlord"
ADDENDUM TO STANDARD INDUSTRIAL LEASE
DATED FEBRUARY 23, 2000 BY AND BETWEEN
43 RAILROAD PARTNERSHIP L.P. ("LANDLORD") AND
XXXXXX BEVERAGE COMPANY ("TENANT")
39. Rent Increases. The Rent as called for in Paragraph I shall commence at
forty four thousand dollars ($44,000) per month. The Rent shall be increased
periodically according to the following schedule:
Months Monthly Rental
1 through 30 $44,000
31 through 60 $46,500
61 through 90 $49,000
91 through 120 $51,000
40. Rent Waiver. Landlord hereby grants a rent waiver to Tenant in the amount of
twenty-five thousand dollars ($25,000) to be applied toward the first month's
rent due under this Lease. In the event of a default as defined in paragraph 13
of the Lease and the Lease is not reinstated within sixty (60) days of such
occurrence, the rent waiver shall automatically be deemed deleted from this
Lease and of no further force and effect, and any portion theretofore previously
credited against the Rent shall be immediately due and payable by Tenant to
Landlord and recoverable by Landlord as additional rent due under this Lease.
41. Tenant Improvement Allowance. Landlord shall provide a tenant improvement
allowance (the "Improvement Allowance") in the amount of three hundred fifty
thousand dollars ($350,000) for the design and construction, etc., of additional
offices and other improvements as outlined in Exhibit "B" or any other
improvement approved by Landlord ("Improvements") as well as for payment of any
upgrade costs over Landlord's existing specifications and allowances that may be
incurred toward initial 2,300 sq. ft. of preplanned office space. In the event
that the Improvements cost more than the Improvement Allowance, Tenant shall
have the right to reduce the Improvements to limit the cost to the Improvement
Allowance; or, alternatively, Tenant shall pay to Landlord on demand the cost of
the Improvements above the Improvement Allowance. If Tenant does not pay to
Landlord the extra costs above the Improvement Allowance or notify Landlord of
the items to be eliminated within ten (10) days of written notice from Landlord,
Landlord may in its sole discretion eliminate items to bring the budget within
the Improvement Allowance and proceed with the construction of the Improvements
as revised. In no event shall commencement of Rent be delayed due to any delay
in completion of the tenant improvement items. Up to ten percent (10%) of any
Improvement Allowance unspent after the first year of the Term may be applied
toward the Rent.
Tenant shall provide Landlord with the mutually acceptable office
tenant improvement plan on or before March 30, 2000.
42. Initial Premises Specification: The Premises include approximately 2,300 sq.
ft. of HVAC office space with "bonus" structural mezzanine above. At Landlord's
expense the Premises shall be modified from the existing construction plans to
include a total of seventeen (17) dock high loading doors.
43. Additional Improvements to be Installed by Landlord. Landlord shall, be
responsible for the erection of a partial separation wall on the east side of
the Premises with pass through openings per mutual tenant's direction. A
directional sign of reasonable size and design and including the Tenant's name
in space not to exceed 3 ft tall and 6 ft wide will be placed at the Railroad
Street entry to the park in the location approximately shown on Exhibit A.
44. Fencing of Vehicles on Site. Subject to Landlord's reasonable approval on
scope and configuration and Tenant compliance with other governmental codes,
Tenant shall be permitted to erect fences around the paved areas onsite adjacent
to the Premises for the purposes of overnight vehicular security. Any fencing
allowed that encloses a paved area shared with an adjoining property shall not
encumber the rights of use of the occupants of that adjoining property. Landlord
may require Tenant to share security gate access with a neighboring tenant.
45. Right of First Offering on Expansion Building. Provided Tenant (i) is not in
default under the Lease, (ii) has a shareholder's equity balance of least seven
million dollars in the most current release of its financial statements, and
(iii) has not assigned nor sublet any portion of the Premises, Landlord shall
give notice in writing to Tenant when, after August 1, 2001, Landlord desires to
lease the neighboring building addressed as 0000 Xxxxxxxx Xxxxxx ("Expansion
Building") to other than an existing tenant of that building. Such notice shall
specify the floor area and configuration of the Expansion Building, the
consideration to be received therefore, and the other terms upon which Landlord
offers to make such lease to Tenant. Tenant shall have the right to enter into a
lease with Landlord at the rent and terms specified in such notice provided that
Tenant shall deliver to Landlord written acceptance of the offer within seven
(7) days after receiving notice from Landlord. If the Tenant does not accept the
offer to lease within the seven (7) day period, then within the following six
(6) months, Landlord shall have the right to enter into a lease on any portion
of the Expansion Building with another party provided that such terms and rental
are not more favorable than those offered to Tenant. This right shall
automatically terminate upon the earlier of a) July 31, 2009 b) termination of
this Lease, or c) the sale of the Expansion Building to a third party that
requires for itself, or its affiliate, the occupancy of the Expansion Building.
This Paragraph shall be deleted from this Lease upon Landlord recording on title
of the Expansion Building a conforming memorandum of said right of first
offering including all of the terms outlined above.
46. Right to Expand Premises. With regard to the remaining 26,600 sq. ft. unit
at the east end of the building ("Expansion Space"), provided that Tenant (i) is
not in default under the Lease, (ii) has a shareholder's equity balance of least
seven million dollars in the most current release of its financial statements,
and (iii) has not assigned nor sublet any portion of the Premises, and (iv) US
Continental, or any successor or assignee thereof, is then the tenant in the
Expansion Space, Tenant shall have the right at anytime during the Term to
expand the Premises to include the Expansion Space by 1) providing Landlord with
authorized written notice of such exercise of this Tenant's right at least one
year prior to the specified expansion date, and 2) executing an amendment to the
Lease effecting such expansion within fifteen days of its delivery by Landlord.
Upon such execution, Landlord shall exercise its relocation and termination
rights on any existing lease covering the Expansion Space to deliver the
Expansion Space to Tenant on the specified expansion date. If the Expansion
Space is not covered by a lease, this right shall remain valid (except that the
expansion date must be no more than two months after Tenant's notice of
exercise) until Landlord has relet the Expansion Space to another tenant, upon
which this right shall become null and void in its entirety. It is hereby agreed
that after the expansion date the Rent, Security Deposit, and reserve deposits
specified in Paragraph 1 herein shall be increased from the schedule shown in
Paragraph 39 above by 23.4%.
47. Paragraph 9.1 Continued. Insurance claim shortfalls greater than $25,000 per
occurrence for capital repairs / replacements may, at Tenant's election, be
amortized over the life of the capital asset as determined by Generally Accepted
Accounting Practices 10% annual interest and paid as additional rent over the
remainder of the Term.
