STANDARD FORM OFFICE LEASE
BETWEEN
CSDV, LIMITED PARTNERSHIP,
A DELAWARE LIMITED PARTNERSHIP,
THE LANDLORD,
AND
ASTOR CAPITAL, INC.,
A CALIFORNIA CORPORATION
THE TENANT
DATED: SEPTEMBER __, 2003
FOR PREMISES LOCATED
AT 0000 XXXXXXXX XXXXXXXXX,
XXXXXXX XXXXX, XXXXXXXXXX
TABLE OF CONTENTS
1. DEFINED TERMS..........................................................1
2. PREMISES DEMISED.......................................................3
3. TERM; OPTION TO EXTEND.................................................3
4. SECURITY DEPOSIT; LETTER OF CREDIT.....................................6
5. RENT...................................................................7
6. INITIAL CONSTRUCTION..................................................14
7. REPAIRS & ALTERATIONS.................................................14
8. FIRE OR CASUALTY DAMAGE...............................................16
9. INSURANCE.............................................................19
10. WAIVER AND INDEMNIFICATION............................................21
11. USE OF PREMISES.......................................................21
12. SIGNS.................................................................22
13. ASSIGNMENT AND SUBLETTING.............................................22
14. EMINENT DOMAIN........................................................24
15. WAIVER AND SEVERABILITY...............................................24
16. USE OF COMMON FACILITIES..............................................25
17. SERVICES..............................................................25
18. ENTRY OF LANDLORD.....................................................26
19. INTENTIONALLY OMITTED.................................................27
20. SUBORDINATION AND ATTORNMENT..........................................27
21. ESTOPPEL CERTIFICATES.................................................27
22. BUILDING RULES AND REGULATIONS........................................27
23. NOTICES...............................................................28
24. EVENTS OF DEFAULT.....................................................28
25. LANDLORD'S REMEDIES...................................................29
26. RIGHT OF LANDLORD TO CURE TENANT'S DEFAULT............................30
27. COMPLIANCE WITH LAW...................................................30
28. BENEFIT...............................................................31
29. PROHIBITION AGAINST RECORDING.........................................31
30. TRANSFER OF LANDLORD'S INTEREST.......................................31
31. FORCE MAJEURE.........................................................31
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32. LANDLORD EXCULPATION..................................................31
33. BUILDING RENOVATIONS..................................................32
34. ATTORNEYS' FEES.......................................................33
35. SURRENDER OF THE PREMISES.............................................33
36. HOLDING OVER..........................................................33
37. JOINT AND SEVERAL.....................................................34
38. GOVERNING LAW.........................................................34
39. SUBMISSION OF LEASE...................................................34
40. BROKERS...............................................................34
41. HAZARDOUS MATERIALS...................................................34
42. LANDLORD'S RESERVATIONS...............................................35
43. PARKING...............................................................35
44. INTENTIONALLY OMITTED.................................................35
45. CONFIDENTIALITY.......................................................35
46. INTERPRETATION OF LEASE...............................................36
47. ACKNOWLEDGMENT. REPRESENTATION AND WARRANTY REGARDING
PROHIBITED TRANSACTIONS........................................36
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EXHIBIT AND ATTACHMENTS
EXHIBIT A Outline of Premises
EXHIBIT B Tenant Work Letter
EXHIBIT C Notice of Lease Term Dates
EXHIBIT D Rules and Regulations
EXHIBIT E Form of Letter of Credit
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STANDARD FORM OFFICE LEASE
This Standard Form Office Lease (this "Lease") is made as of
September___2003 (the "Lease Date"), by CSDV, LIMITED PARTNERSHIP, a Delaware
limited partnership ("Landlord"), and ASTOR CAPITAL, INC., a California
corporation ("Tenant").
Landlord and Tenant, intending to be legally bound, and in consideration of
their mutual covenants and all conditions of this Lease, covenant and agree as
follows.
BASIC LEASE PROVISIONS
1. DEFINED TERMS
In this Lease the following terms have the meanings set forth below.
1.1 PREMISES. Approximately 3,245 rentable (2,798 usable) square feet,
known as Suite 700 and located on the seventh (7th) floor of the
Building, as outlined on Exhibit A attached to and a part of this
Lease.
1.2 BUILDING. The building containing approximately 159,441 rentable
square feet, and all future alterations, additions, improvements,
restorations or replacements, with an address of 0000 Xxxxxxxx
Xxxxxxxxx, Xxxxxxx Xxxxx, Xxxxxxxxxx.
1.3 TERM. Five (5) years.
1.4 COMMENCEMENT DATE. December 1, 2003, subject to adjustment as set in
Article 3.
1.5 EXPIRATION DATE. November 30, 2008, subject to adjustment as set
forth.
1.6 BASE RENT.
MONTHS OF MONTHLY
LEASE TERM INSTALLMENT
OF BASE RENT
1-12 $9,086.00
13-24 $9,358.58
25-36 $9,639.34
36-48 $9,928.52
48-60 $10,226.37
1.7 SECURITY DEPOSIT. $10,226.37.
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1.8 BASE YEAR. The Base Year for calculation of Operating Costs shall be
calendar year 2004.
1.9 TENANT'S PROPORTIONATE SHARE OF OPERATING COSTS. 2.04% of the
Operating Costs as defined in Article 5 allocable to the Building,
based upon the rentable square feet of the Premises, compared to the
total rentable square feet of the Building.
1.10 PERMITTED USE. General office use, consistent with a first class
office building.
1.11 TENANT'S TRADE NAME. N/A.
1.12 BROKER(S). Landlord's: CB Xxxxxxx Xxxxx. Tenant's: First
Property Realty Corporation.
1.13 LETTER OF CREDIT. $100,000.00, subject to Paragraph 4.2 below.
1.14 HOURS OF SERVICE (SECTION 17.1). The hours of service for the Building
shall be between 8:00 a.m. and 6:00 p.m., Monday through Friday, and
between 9:00 a.m. and 1:00 p.m. on Saturday.
1.15 LANDLORD'S ADDRESS. CB Xxxxxxx Xxxxx Investors LLC
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Portfolio Manager
1.16 TENANT'S ADDRESS.
BEFORE OCCUPANCY: AFTER OCCUPANCY:
Astor Capital, Inc. Astor Capital, Inc.
0000 Xxxxxxxx Xxxxxxxxx 0000 Xxxxxxxx Xxxxxxxxx
Xxxxx 000 Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000 Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xx. Xxxxxxx Xxxxxx Attention: Xxxxxxx Xxxxxx
1.17 PARKING. Seven (7) unreserved spaces, and one (1) tandem space
(comprised of 2 unreserved spaces) which tandem space shall be located
on level P-l of the Building parking facility.
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1.18 AMOUNT DUE ON EXECUTION OF LEASE. Upon Tenant's execution of this
Lease, Tenant shall pay the following amount to Landlord:
Monthly Rent: $9,086.00
(For the First Month of the Term)
Security Deposit: $10,226.37
TOTAL DUE ON EXECUTION OF LEASE $19,312.37
2. PREMISES DEMISED
Landlord hereby leases to Tenant and Tenant hereby leases from Landlord the
premises described in Section 1.1 ("Premises") on the terms and conditions
set forth in this Lease (including all exhibits and attachments hereto,
which are incorporated herein by reference). Tenant's obligations under
this Lease shall commence as of the Lease Date, except as otherwise
expressly provided in this Lease. As used in this Lease, the term "Project"
includes the Building, adjoining parking areas and garages, if any, and the
surrounding land and air space which are the site and grounds for the
Building and parking areas and garages.
3. TERM; OPTION TO EXTEND
3.1 INITIAL TERM. The Term, Commencement Date and Expiration Date shall be
as specified in Sections 1.3, 1.4, and 1.5, respectively. However, the
Commencement Date shall be adjusted if necessary, and documented in
the form of Exhibit C attached hereto, to the earlier of: (a) the date
the "Tenant Improvements" are "Substantially Complete" as those terms
are defined in the Tenant Work Letter, attached hereto as Exhibit B;
or (b) the date Tenant takes possession of the Premises, and the
Expiration Date shall be adjusted accordingly. For purposes of this
Lease, the term "Lease Year" shall mean each consecutive twelve (12)
month period during the Term, commencing on the Commencement Date. The
terms and provisions of this Lease shall be effective as of the Lease
Date.
3.2 OPTION TERM.
3.2.1 OPTION RIGHT. Landlord hereby grants the Tenant named in the
Summary (the "Original Tenant") one (1) option to extend the
Lease Term for a period of five (5) years (the "Option Term"),
which option shall be exercisable only by written notice
delivered by Tenant to Landlord as provided below, provided that,
as of the date of delivery of such notice, Tenant is not in
default under this Lease and Tenant has not previously been in
default under this Lease beyond the applicable cure period
provided in this Lease more than once in the preceding twelve
(12) months. Upon the proper exercise of such option to extend,
and provided that, as of the end of the initial Term, Tenant is
not in default under this Lease and Tenant has not previously
been in default under this Lease beyond the applicable cure
period provided in this Lease more than once in the preceding
twelve (12) months, the Term, as it applies to the Premises,
shall be extended for a period of five (5) years. The rights
contained in this Section 3.2 shall be personal to the Original
Tenant and may only be exercised by the Original Tenant (and
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not any assignee, sublessee or other transferee of Tenant's
interest in this Lease) if the Original Tenant occupies at least
seventy-five percent (75%) of the Premises.
3.2.2 OPTION RENT. The rent payable by Tenant during the Option Term
(the "Option Rent") shall be equal to the rent (including
additional rent and considering any "base year" or "expense stop"
applicable thereto), including all escalations, at which, as of
the commencement of the Option Term, tenants are leasing
non-sublease, non-renewal, non-encumbered, non-equity space
comparable in size, location and quality to the Premises, for a
term of five (5) years, which comparable space is located in
other comparable first class office buildings in Beverly Hills,
California ("Comparable Buildings"), taking into consideration
the following concessions (the "Renewal Concessions"): (a) rental
abatement concessions, if any, being granted such tenants in
connection with such comparable space; (b) tenant improvements or
allowances provided or to be provided for such comparable space,
taking into account, and deducting the value of, the existing
improvements in the Premises, such value to be based upon the
age, quality and layout of the improvements and the extent to
which the same can be utilized by Tenant based upon the fact that
the precise tenant improvements existing in the Premises are
specifically suitable to Tenant; and (c) other reasonable
monetary concessions being granted such tenants in connection
with such comparable space; provided, however, that in
calculating the Option Rent, no consideration shall be given to
(i) the fact that Landlord is or is not required to pay a real
estate brokerage commission in connection with Tenant's exercise
of its right to lease the Premises during the Option Term or the
fact that landlords are or are not paying real estate brokerage
commissions in connection with such comparable space, and (ii)
any period of rental abatement, if any, granted to tenants in
comparable transactions for the design, permitting and
construction of tenant improvements in such comparable spaces. If
Renewal Concessions are g, anted to Tenant, Landlord may, at
Landlord's sole option, elect any or a portion of the following:
(A) to grant some or all of the Renewal Concessions to Tenant in
the form as described above (i.e., as free rent or as an
improvement allowance), and (B) to adjust the rental rate
component of the Option Rent to be an effective rental rate which
takes into consideration the total dollar value of such Renewal
Concessions (in which case the Renewal Concessions evidenced in
the effective rental rate shall not be granted to Tenant).
3.2.3 EXERCISE OF OPTION. The option contained in this Section 3.2
shall be exercised by Tenant, if at all, only in the following
manner: (i) Tenant shall deliver written notice to Landlord not
more than not less than twelve (12) months prior to the
expiration of the Term, stating that Tenant is interested in
exercising its option; (ii) Landlord, after receipt of Tenant's
notice, shall deliver notice (the "Option Rent Notice") to Tenant
not less than ten (10) months prior to the expiration of the
Term, setting forth Landlord's proposed Option Rent; and (iii) if
Tenant wishes to exercise such option, Tenant shall, on or before
the earlier of (A) the date occurring nine (9) months prior to
the expiration of the Term, and (B) the date occurring thirty
(30) days after Tenant's receipt of the Option Rent Notice,
exercise the option by delivering written notice thereof to
Landlord, and upon, and concurrent with, such exercise, Tenant
may, at its option, object to the Option Rent contained in the
Option Rent Notice, in which case the parties shall follow the
procedure, and the Option Rent shall be determined, as set forth
in Section 3.2.4 below. If Tenant timely and properly exercises
its Option to Extend, the Lease Term shall be extended for the
Option Term upon all of the terms and conditions set forth in
this Lease, except as modified with respect to the components
addressed in the determination of the Option Rent, or otherwise
upon the mutual agreement of Landlord and Tenant.
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3.2.4 DETERMINATION OF OPTION RENT. In the event Tenant timely and
appropriately objects to the Option Rent, Landlord and Tenant
shall attempt to agree upon the Option Rent, using their best
good-faith efforts. If Landlord and Tenant fail to reach
agreement within ten (10) business days following Tenant's
objection to the Option Rent (the "Outside Agreement Date"), then
each party shall make a separate determination of the Option
Rent, within five (5) business days after the applicable Outside
Agreement Date, and such determinations shall be submitted to
arbitration in accordance with Sections 3.2.4.1 through 3.2.4.7
below.
3.2.4.1 Landlord and Tenant shall each appoint one arbitrator who
shall be a real estate broker who shall have been active
over the five (5) year period ending on the date of such
appointment in the leasing of commercial high-rise
properties in the Westwood/Brentwood area of Los Angles,
California. The determination of the arbitrators shall be
limited solely to the issue of whether Landlord's or
Tenant's submitted Option Rent, is the closest to the actual
Option Rent, as determined by the arbitrators, taking into
account the requirements of Section 3.2.2 of this Lease, as
applicable. Each such arbitrator shall be appointed within
fifteen (15) days after the applicable Outside Agreement
Date.
3.2.4.2 The two (2) arbitrators so appointed shall within ten
(10) days of the date of the appointment of the last
appointed arbitrator agree upon and appoint a third
arbitrator who shall be qualified under the same criteria
set forth hereinabove for qualification of the initial two
(2) arbitrators and who shall not have represented either
Landlord or Tenant during the preceding three (3) years.
3.2.4.3 The three (3) arbitrators shall within thirty (30) days
of the appointment of the third arbitrator reach a decision
as to whether the parties shall use Landlord's or Tenant's
submitted Option Rent, and shall notify Landlord and Tenant
thereof.
3.2.4.4 The decision of the majority of the three (3) arbitrators
shall be binding upon Landlord and Tenant.
3.2.4.5 If either Landlord or Tenant fails to appoint an
arbitrator within fifteen (15) days after the applicable
Outside Agreement Date, then the arbitrator appointed by one
of them shall reach a decision, notify Landlord and Tenant
thereof, and such arbitrator's decision shall be binding
upon Landlord and Tenant.
3.2.4.6 If the two (2) arbitrators fail to agree upon and appoint
a third arbitrator, or if both parties fail to appoint an
arbitrator, then the appointment of the third arbitrator or
any arbitrator shall be dismissed and the matter to be
decided shall be forthwith submitted to arbitration under
the provisions of the American Arbitration Association, but
subject to the instruction set forth in this Section 3.2.4.
3.2.5 The cost of the arbitration shall be paid by Landlord and Tenant
equally.
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4. SECURITY DEPOSIT; LETTER OF CREDIT
4.1 SECURITY DEPOSIT. Concurrently with Tenant's execution of this Lease,
Tenant shall deposit with Landlord in the amount set forth in Section
1.7, a security deposit for the performance of all of Tenant's
obligations under this Lease. Upon expiration of the Term, Landlord
shall (provided that Tenant is not then in default under this Lease)
return the security deposit to Tenant, less such portion as Landlord
shall have appropriated to make good any default by Tenant. Landlord
shall have the right, but not the obligation, to apply all or any
portion of the security deposit to cure any Tenant default at any
time, in which event Tenant shall be obligated to restore the security
deposit to its original amount within ten (10) business days, and
Tenant's failure to do so shall be deemed to be a material default of
this Lease. Tenant hereby waives the provisions of Section 1950.7 of
the California Civil Code, and all other provisions of law, now or
hereafter in force, which provide that Landlord may claim from a
security deposit only those sums reasonably necessary to remedy
defaults in the payment of rent, to repair damage caused by Tenant or
to clean the Premises, it being agreed that Landlord may, in addition,
claim those sums reasonably necessary to compensate Landlord for any
other loss or damage, foreseeable or unforeseeable, caused by the act
or omission of Tenant or any officer, employee, agent or invitee of
Tenant.
4.2 LETTER OF CREDIT. Tenant shall deliver to Landlord concurrently with
Tenant's execution of this Lease, an unconditional, clean, irrevocable
letter of credit (the "L-C") in the initial amount (the "Initial L-C
Amount") of One Hundred Thousand and No/100 Dollars ($100,000.00),
which L-C shall be issued by a money-center bank (a bank which accepts
deposits, maintains accounts, has a local Los Angeles office which
will negotiate a letter of credit, and whose deposits are insured by
the FDIC) reasonably acceptable to Landlord, and which L-C shall be in
form and content as set forth in Exhibit E attached hereto. Tenant
shall pay all expenses, points and/or fees incurred by Tenant in
obtaining the L-C.
4.2.1 APPLICATION OF THE L-C. The L-C shall be held by Landlord as
security for the faithful performance by Tenant of all the terms,
covenants, and conditions of this Lease to be kept and performed
by Tenant during the Lease Term. The L-C shall not be mortgaged,
assigned or encumbered in any manner whatsoever by Tenant without
the prior written consent of Landlord. If Tenant defaults with
respect to any provisions of this Lease, including, but not
limited to, the provisions relating to the payment of Rent, or if
Tenant fails to renew the L-C at least thirty (30) days before
its expiration, Landlord may, but shall not be required to, draw
upon all or any portion of the L-C for payment of any Rent or any
other sum in default, or for the payment of any amount that
Landlord may reasonably spend or may become obligated to spend by
reason of Tenant's default, or to compensate Landlord for any
other loss or damage that Landlord may suffer by reason of
Tenant's default, provided that Landlord shall first apply the
Security Deposit for such purposes prior to drawing on the L-C
for such purposes. The use, application or retention of the L-C,
or any portion thereof, by Landlord shall not (a) prevent
Landlord from exercising any other right or remedy provided by
this Lease or by law, it being intended that Landlord shall not
first be required to proceed against the L-C, nor (b) operate as
a limitation on any recovery to which Landlord may otherwise be
entitled. Any amount of the L-C which is drawn upon by Landlord,
but is not used or applied by Landlord, shall be held by Landlord
and deemed a security deposit (the "L-C Security Deposit"). If
any portion of the L-C is drawn upon, Tenant shall, within five
(5) days after written demand therefore either (i) deposit
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cash with Landlord (which cash shall be applied by Landlord to
the L-C Security Deposit) in an amount sufficient to cause the
sum of the L-C Security Deposit and the amount of the remaining
L-C to be equivalent to the amount of the L-C then required under
this Lease or (ii) reinstate the L-C to the amount then required
under this Lease, and if any portion of the L-C Security Deposit
is used or applied, Tenant shall, within five (5) days after
written demand therefore, deposit cash with Landlord (which cash
shall be applied by Landlord to the L-C Security Deposit) in an
amount sufficient to restore the L-C Security Deposit to the
amount then required under this Lease, and Tenant's failure to do
so shall be a default under this Lease. Tenant acknowledges that
Landlord has the right to transfer or mortgage its interest and
the Project and in this Lease and Tenant agrees that in the event
of any such transfer or mortgage, Landlord shall have the right
to transfer or assign the L-C Security Deposit and/or the L-C to
the transferee or mortgagee, and in the event of such transfer,
Tenant shall look solely to such transferee or mortgagee for the
return of the L-C Security Deposit and/or the L-C.
4.2.2 REDUCTION OF L-C. If Tenant has not been in default under this
Lease, the Initial L-C Amount shall be reduced, commencing with
the first (1st) anniversary of the Commencement Date and on each
of the following anniversaries of the Commencement Date
thereafter to the following amounts:
Anniversary of Lease Amount of
Commencement Date Letter of Credit
1st $80,000.00
2nd $60,000.00
3rd $10,000.00
If Tenant shall fully and faithfully perform every provision of this Lease to be
performed by it, the L-C Security Deposit and/or the L-C, or any balance
thereof, shall be returned to Tenant within thirty (30) days following the
expiration of the Term.
5. RENT
5.1 Tenant agrees to pay the Base Rent set forth in Section 1.6 for each
month of the Term, payable in advance on the first day of each month
commencing with the Commencement Date, without any deduction or setoff
whatsoever. All payments of Rent (as defined in Section 5.4) shall be
payable in lawful U.S. money. Payments shall not be deemed received
until actual receipt thereof by Landlord. If the Commencement Date is
not the first day of a month, or if the Expiration Date is not the
last day of a month, a prorated monthly installment shall be paid at
the then current rate for the fractional month during which this Lease
commences or terminates. At the time of execution of this Lease by
Tenant, Tenant shall pay all money due to Landlord as set forth in
Article 1. Notwithstanding anything in the foregoing to the contrary,
provided Tenant is not in default under the Lease, Tenant shall be
entitled to a rent credit (the "Rent Credit") in an amount equal to
Thirteen Thousand Six Hundred Twenty-Nine and No/100 Dollars
($13,629.00) (or one and one-half months of Base Rent at the rental
rate
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applicable to the first month of the Term), which Tenant may apply
towards monthly Base Rent due under the Lease, in increments equal to
100% of the monthly Base Rent due for the second (2nd) month of the
Term and 50% of the monthly Base Rent due for the third (3rd) month of
the Term (the "Rent Credit Period").
5.2 INTENTIONALLY DELETED.
5.3 INTENTIONALLY DELETED.
5.4 In addition to Base Rent, for each calendar year beginning after the
Base Year, Tenant shall pay to Landlord on the first day of each and
every month of this Lease, one-twelfth (1/12th) of the Landlord's
reasonable estimate of Tenant's Proportionate Share of the Operating
Costs for that calendar year in excess of the actual Base Year
Operating Costs. The rentable area in the Building and the rentable
area in the Premises, and Tenant's Proportionate Share of the
Operating Costs are set forth in Article 1. Any discrepancy discovered
after the Lease Date in connection with the square footages stated in
Sections 1.1 and 1.2 shall not be a basis for a reduction in the Base
Rent, unless otherwise agreed in writing by Landlord and Tenant. Base
Rent, Tenant's Proportionate Share of Operating Costs, and all other
amounts payable by Tenant under this Lease whether to Landlord or to
others are collectively defined as the "Rent."
5.5 OPERATING COSTS.
5.5.1 "OPERATING COSTS" shall be determined for each calendar year by
taking into account on a consistent basis all costs of
management, maintenance, and operation of the Project. Operating
Costs shall include but not be limited to: (i) the cost of
supplying all utilities, the cost of operating, maintaining,
repairing, renovating and managing the utility systems,
mechanical systems, sanitary and storm drainage systems, and
escalator and elevator systems, and the cost of supplies and
equipment and maintenance and service contracts in connection
therewith; (ii) the cost of licenses, certificates, permits and
inspections and the cost of contesting the validity or
applicability of any governmental enactments which may affect
Operating Costs, and the costs incurred in connection with the
implementation and operation of a transportation system
management program or similar program; (iii) the cost of
insurance carried by Landlord, in such amounts as Landlord may
reasonably determine, including, without limitation, insurance
premiums and insurance deductibles paid or incurred by Landlord;
(iv) fees, charges and other costs, including management fees,
consulting fees, legal fees and accounting fees, of all persons
engaged by Landlord or otherwise reasonably incurred by Landlord
in connection with the management, operation, maintenance and
repair of the Project; (v) wages, salaries and other compensation
and benefits of all persons engaged in the operation, maintenance
or security of the Building, and employer's Social Security
taxes, unemployment taxes or insurance, and any other taxes which
may be levied on such wages, salaries, compensation and benefits;
provided, that if any employees of Landlord provide services for
more than one building of Landlord, then a prorated portion of
such employees' wages, benefits and taxes shall be included in
Operating Costs based on the portion of their working time
devoted to the Building; (vi) payments under any easement,
license, operating agreement, declaration, restrictive covenant,
or instrument pertaining to the sharing of costs by the Building;
(vii) operation, repair, maintenance and replacement of all
systems, equipment, components or
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facilities which serve the Building in the whole or in part;
(viii) amortization (including interest on the unamortized cost
at a rate equal to the floating commercial loan rate announced
from time to time by Bank of America, a national banking
association, as its prime rate, plus 2% per annum) of the cost of
acquiring or the rental expense of personal property used in the
maintenance, operation and repair of the Building and Project;
and (ix) all federal, state, county, or local governmental or
municipal taxes, fees, charges or other impositions of every kind
and nature, whether general, special, ordinary or extraordinary
because of or in connection with the ownership, leasing and
operation of the Project, including, without limitation, any
assessment, tax, fee, levy or charge in addition to, or in
substitution, partially or totally, of any assessment, tax, fee,
levy or charge previously included within the definition of real
property tax, it being acknowledged by Tenant and Landlord that
Proposition 13 was adopted by the voters of the State of
California in the June 1978 election and that assessments, taxes,
fees, levies and charges may be imposed by governmental agencies
for such services as fire protection, street, sidewalk and road
maintenance, conservation, refuse removal and for other
governmental services formerly provided without charge to
property owners or occupants (all of the foregoing, "Tax
Expenses"); (x) costs incurred in connection with the parking
areas servicing the Project; and (xi) the cost of capital
improvements or other costs incurred in connection with the
Project (A) which are intended as a labor-saving device or to
effect other economies in the operation or maintenance of the
Project, or any portion thereof, or (B) that are required under
any governmental law or regulation but which were not so required
in connection with the Project at the time that permits for the
construction of the Building were obtained provided, however,
that each such permitted capital expenditure shall be amortized
(including interest on the unamortized cost) over its useful life
as Landlord shall reasonably determine. Landlord shall have the
right, but not the obligation, from time to time, to equitably
allocate some or all of the Operating Costs among different
tenants of the building (the "Cost Pools"). Such Cost Pools may
include, but shall not be limited to, the office space tenants of
the Building and the retail space tenants of the Building. The
amount of all taxes payable under this Lease for the Base Year
attributable to the valuation of the Project, inclusive of tenant
improvements, shall be known as "Base Taxes." Notwithstanding
anything to the contrary set forth in this Lease, the amount of
Tax Expenses for the Base Year and any Expense Year shall be
calculated without taking into account any decreases in real
estate taxes obtained in connection with Proposition 8, and,
therefore, the Tax Expenses in the Base Year and/or any
comparison year may be greater than those actually incurred by
Landlord, but shall, nonetheless, be the Tax Expenses due under
this Lease; provided that (i) any costs and expenses incurred by
Landlord in securing any Proposition 8 reduction shall not be
deducted from Tax Expenses nor included in Building Direct
Expenses for purposes of this Lease, and (ii) tax refunds under
Proposition 8 shall not be deducted from Tax Expenses nor
refunded to Tenant, but rather shall be the sole property of
Landlord. Landlord and Tenant acknowledge that this provision is
not intended to in any way affect (A) the inclusion in Tax
Expenses of the statutory two percent (2.0%) annual increase in
Tax Expenses (as such statutory increase may be modified by
subsequent legislation), or (B) the inclusion or exclusion of Tax
Expenses pursuant to the terms of Proposition 13. If the Building
is less than ninety-five percent (95%) occupied during all or a
portion of the Base Year or a subsequent calendar year, the
variable components of the Operating Costs as reasonably
determined by Landlord, using sound accounting and management
principles, shall be calculated as if the Building had been 95%
occupied for the full calendar year. If Landlord is not
furnishing any particular work or service (the cost of which, if
performed by Landlord, would be included in Operating Costs) to a
tenant who has undertaken to
9
perform such work or service in lieu of the performance thereof
by Landlord, Operating Costs shall be deemed to be increased by
an amount equal to the additional Operating Costs which would
reasonably have been incurred during such period by Landlord if
it had, at its own expense, furnished such work or service to
such tenant. Anything contained in the Lease to the contrary
notwithstanding, Tenant acknowledges and agrees that for so long
as the Project is owned by the State of California or any local
public entity of government, including without limitation a state
public retirement system, this Lease and the Tenant's interest
hereunder may constitute a possessory interest subject to
property taxation and as a result may be subject to the payment
of property taxes levied on that interest. In addition, for so
long as the Project is owned by a state public retirement system,
the full cash value, as defined in Sections 110 and 110.1 of the
California Revenue and Taxation Code, of the possessory interest
upon which property taxes will be based will equal the greater of
(A) the full cash value of the possessory interest, or (B) if
Tenant has leased less than all of the Project, Tenant's
Proportionate Share of the full cash value of the Project that
would have been enrolled if the Project had been subject to
property tax upon acquisition by the state public retirement
system.
5.5.2 "OPERATING COSTS" shall not include any of the following, for
purposes of calculating the portion of Operating Costs payable by
Tenant:
(A) except as otherwise specifically provided in this Section
5.5, costs of repairs or other work occasioned by fire,
windstorm or other casualty (other than those amounts within
the deductible limits of insurance policies actually carried
by Landlord, which amounts shall be includable as Operating
Costs so long as such deductibles are within the generally
prevailing range of deductibles to policies carried by
landlords of comparable first class office buildings located
in the vicinity of the Building);
(B) costs of leasing commissions, attorneys' fees and other
costs and expenses incurred in connection with negotiations
or disputes with present or prospective tenants or other
occupants of the Building;
(C) except as otherwise specifically provided in this Section
5.5, costs incurred by Landlord in the repairs, capital
additions, alterations or replacements made or incurred to
rectify or correct defects in design, materials or
workmanship in connection with any portion of the Building;
(D) costs (including permit, license and inspection costs)
incurred in renovating or otherwise improving, decorating or
redecorating rentable space for other tenants or vacant
rentable space;
(E) cost of utilities or services sold to Tenant or others for
which Landlord is entitled to and actually receives
reimbursement (other than through any operating cost
reimbursement provision identical or substantially similar
to the provisions set forth in this Lease);
(F) except as otherwise specifically provided in this Section
5.5, costs incurred by Landlord for alterations to the
Building which are considered capital
10
improvements and replacements under generally accepted
accounting principles, consistently applied;
(G) costs of depreciation and amortization, except on materials,
small tools and supplies purchased by Landlord to enable
Landlord to supply services Landlord might otherwise
contract for with a third party, where such depreciation and
amortization would otherwise have been included in the
charge for such third party services, all as determined in
accordance with generally accepted accounting principles,
consistently applied;
(H) costs of services or other benefits which are not available
to Tenant but which are provided to other tenants of the
Building;
(I) costs incurred due to the violation by Landlord or any other
tenant of the terms and conditions of any lease of space in
the Building;
(J) costs of overhead or profit increment paid to Landlord or to
subsidiaries or affiliates of Landlord for services in or in
connection with the Building to the extent the same exceeds
the cost of such services which could be obtained from third
parties on a competitive basis;
(K) except as otherwise specifically provided in this Section
5.5, costs of interest on debt or amortization on any
mortgages, and rent and other charges, costs and expenses
payable under any mortgage, if any;
(L) costs of general overhead and general administrative
expenses, not including management fees and building office
expenses which are included in operating expenses by
Landlords of other comparable first class office buildings
located in the vicinity of the Building;
(M) costs of any compensation and employee benefits paid to
clerks, attendants or other persons in a commercial
concession operated by Landlord, except the Building parking
facility;
(N) costs of rentals and other related expenses incurred in
leasing HVAC, elevators or other equipment ordinarily
considered to be of a capital nature except equipment which
is used in providing janitorial or similar services and
which is not affixed to the Building;
(O) costs of advertising and promotion;
(P) costs of electrical power for which Tenant directly
contracts with and pays a local public service company;
(Q) costs incurred to comply with laws relating to the removal
of Hazardous Material which was in existence on the Project
prior to the Commencement Date, and was of such a nature
that a federal, state or municipal governmental authority,
if it had then had knowledge of the presence of such
Hazardous Material, in the state, and under the conditions
11
that it existed on the Project, would have then required the
removal of such Hazardous Material or other remedial or
containment action with respect thereto; and
(R) costs incurred to remove, remedy, contain, or treat
Hazardous Material, which Hazardous Material is brought onto
the Project, after the date hereof by Landlord or any other
tenant of the Project and is of such a nature, at that time,
that a federal, state or municipal governmental authority,
if it had then had knowledge of the presence of such
Hazardous Material, in the state, and under the conditions,
that it exists on the Project, would require the removal,
remediation, containment or treatment of such Hazardous
Material.
5.6 Within one hundred twenty (120) days after December 31 of each
calendar year, or as soon thereafter as practicable, the total of the
Operating Costs for said calendar year just completed shall be
determined by Landlord. Landlord shall give Tenant notice of such
determination, and Tenant within thirty (30) days thereafter shall pay
to Landlord Tenant's Proportionate Share of the Operating Costs for
such calendar year in excess of the Base Year Operating Costs, less
the payments made by Tenant to Landlord during such calendar year for
Operating Costs in excess of the Base Year Operating Costs, or, if
Tenant has overpaid such amount, Landlord shall credit any excess paid
toward Tenant's next rental payment due. During the first and last
years of the Term, Tenant's Proportionate Share of the Operating Costs
shall be adjusted in proportion to the number of days of that calendar
year during which this Lease is in effect over the total days in that
calendar year.
5.7 TENANT'S DISPUTE OF OPERATING COSTS.
5.7.1 In the event Tenant disputes the actual amount due as Tenant's
Proportionate Share of Operating Costs and/or the actual amount
due as Operating Costs, Tenant may give written notice to
Landlord (the "Inspection Request Notice") of Tenant's desire to
review a summary of accounts prepared by Landlord applicable to
Landlord's determination of the Operating Costs ("Accounts
Summary"). Such notice shall be given by Tenant no later than
ninety (90) days after Tenant's receipt of Landlord's
determination of the Operating Costs for the previous calendar
year. Provided that Tenant has given Landlord the Inspection
Request Notice, Tenant may, at reasonable times, inspect the
Accounts Summary at Landlord's office or at such other office as
may be designated by Landlord, provided however, Tenant shall
have the rights contained in this Section 5.7.1 only if (a) there
is then no Event of Default, as defined in Article 24, and (b)
for the year for which Tenant disputes the amount due as Tenant's
Proportionate Share of Operating Costs, both (i) the percentage
increase thereof over the previous year exceeded three percent
(3%), and (ii) the dollar amount of the increase of Tenant's
Share of Operating Costs for the disputed year over the previous
year shall be at least $1,000.00.
5.7.2 The review by Tenant of the Accounts Summary shall be commenced
no later than ten (10) business days after the date of Landlord's
receipt of the Inspection Request Notice (subject to reasonable
coordination of the timing with Landlord), and shall be completed
no later than thirty (30) days after the beginning of such
review. If, after such inspection, Tenant continues to dispute
the amount due as Tenant's Proportionate Share of Operating
Costs, Tenant shall, within ten (10) business days after the end
of such thirty (30) day review period, give written notice to
Landlord (the "Dispute Notice") of the particular costs or
expenses included in the Operating Costs which Tenant disputes,
and the basis for Tenant's
12
dispute thereof. In the event that an error has been made in
Landlord's determination of Tenant's Proportionate Share of
Operating Costs, and Landlord does not dispute any matters
contained in Tenant's Dispute Notice, then the parties shall make
such appropriate payments or reimbursements, as the case may be,
to each other as are determined to be owing, provided that any
reimbursements payable by Landlord to Tenant may, at Landlord's
option, instead be credited against the Base Rent next coming due
under this Lease, unless the Term has expired, in which event
Landlord shall refund (or credit against any other amounts then
owing by Tenant) the appropriate amount to Tenant, and provided
further, that if Landlord's determination of Operating Costs
overstated the Operating Costs by five percent (5%) or more, then
provided that Tenant is not then in breach of this Lease,
Landlord shall give Tenant a credit against future Base Rent for
an amount equal to Tenant's actual, reasonable costs incurred by
Tenant in conducting Tenant's review.
5.7.3 If Landlord informs Tenant that Landlord disputes any of the
matters contained in the Dispute Notice, then, within fourteen
(14) days after Tenant is informed of Landlord's dispute of any
of the matters contained in the Dispute Notice, Tenant shall hire
a regionally recognized accounting firm ("CPA Firm") to review
the Accounts Summary. Such review of the Accounts Summary by the
CPA Firm shall be completed not later than thirty (30) days after
Landlord informs Tenant that Landlord disputes any of the matters
contained in the Dispute Notice. The CPA Firm shall produce a
written report (the "CPA Firm Report") describing its review and
conclusions in detail, a copy of which shall be given to both
Landlord and Tenant and both Landlord and Tenant shall be bound
by the CPA Firm Report, and if the CPA Firm Report accurately,
and with appropriate supporting documentation, indicates that
Landlord's determination of Operating Costs overstated the
Operating Costs by at least five percent (5%), then provided that
Tenant is not then in breach of this Lease, Landlord shall give
Tenant a credit against future rental amounts for an amount equal
to the reasonable cost of the CPA Firm Report.
5.7.4 Tenant agrees that neither Tenant nor any of Tenant's employees,
agents or representatives (including, without limitation, the CPA
Firm) shall use or disclose to any person or entity other than
Tenant, any information or documents obtained by Tenant or such
other persons during inspection of Landlord's accounting records,
provided however, this sentence shall not apply to, or bar or
limit any legal action between Tenant and Landlord to enforce
this Lease. Except as expressly provided in this paragraph,
Tenant shall have no rights to inspect, copy, review, or audit
the records of Landlord relating to Operating Costs, nor to
dispute any portion of Operating Costs charged by Landlord to
Tenant. Notwithstanding any claim or dispute regarding Operating
Costs which may arise, in no event shall Tenant be entitled to
deduct, offset or reduce any Rent otherwise payable by Tenant
under this Lease. All reviews of, and reports concerning the
Accounts Summary shall be at Tenant's sole cost and expense,
subject to the provisions of Section 5.7.3.
5.8 In addition to Tenant's Proportionate Share of Operating Costs, Tenant
shall reimburse Landlord upon demand for any and all taxes required to
be paid by Landlord when such taxes are measured by or reasonably
attributable to the cost or value of Tenant's equipment, furniture,
fixtures and other personal property located in the Premises.
13
6. INITIAL CONSTRUCTION
Construction, if any, to be completed by Landlord will be in accordance
with the plans, specifications and agreements approved by both parties,
attached to and made a part of this Lease as Exhibit B. Landlord will not
be obligated to construct or install any improvements or facilities of any
kind other than those called for in Exhibit B. All improvements shall be
the property of Landlord, subject to Section 7.4, and upon termination of
this Lease, Tenant shall deliver the Premises to Landlord in the condition
required by Article 35.
7. REPAIRS & ALTERATIONS
7.1 Subject to reimbursement pursuant to Section 5.4, and subject to the
provisions of Section 7.2, and Articles 8 and 14, Landlord agrees to
keep in good condition the foundations, exterior walls, structural
portions of the Project, the roof, the elevators and the HVAC,
mechanical, electrical and plumbing systems installed in the original
construction of the Building, (excluding, however, any plumbing in the
Premises or any above Building-standard heating, air conditioning or
lighting equipment in the Premises, which repair shall be Tenant's
sole responsibility) but, except as set forth in Section 17.4 below,
Landlord shall not be liable or responsible for breakdowns or
temporary interruptions in service where reasonable efforts are used
to restore service, and provided that Landlord shall not be
responsible for any repair or maintenance which is caused in whole or
in part by the act or omission of Tenant or its agents, contractors,
employees, or guests; in the event of such repair or maintenance
caused by the act or omission of Tenant, Tenant shall pay for such
repair or maintenance upon demand from Landlord and shall indemnify,
defend, protect and hold harmless Landlord against any and all loss,
cost or liability in connection therewith. Landlord shall have at
least thirty (30) days after written notice from Tenant to perform
necessary repairs or maintenance, provided to the extent any such
repairs cannot be reasonably made in such period, Landlord shall not
be in default hereunder so long as Landlord commences such repair
within such thirty (30) day period and diligently pursues the same to
completion. Tenant hereby waives and releases its right to make
repairs at Landlord's expense under Sections 1941 and 1942 of the
California Civil Code or under any similar law, statute, or ordinance
now or hereafter in effect.
7.2 Subject to the provisions of Section 7.1, and Articles 8 and 14,
Tenant shall keep and maintain the Premises in first class condition
and repair, and shall make all necessary repairs thereto at Tenant's
sole cost and expense. Tenant is responsible for all redecorating,
remodeling, alteration and painting required by Tenant during the
Term, except to the extent otherwise expressly set forth in Exhibit B.
Tenant covenants and agrees not to suffer or permit any lien of
mechanics or materialmen or others to be placed against the Project,
the Building or the Premises with respect to work or services claimed
to have been performed for or materials claimed to have been furnished
to Tenant or the Premises under this Article 7 or otherwise, and, in
case of any such lien attaching or notice of any lien, Tenant
covenants and agrees to cause it to be immediately released and
removed of record or Landlord, at its sole option, may immediately
take all action necessary to release and remove such lien, and Tenant
shall, upon demand, immediately reimburse Landlord for all costs and
expenses relating thereto incurred by Landlord.
14
7.3 Tenant may not make any improvements, alterations, additions or
changes to the Premises (collectively, the "Alterations") without
first procuring the written consent of Landlord to such Alterations,
which consent shall be requested by Tenant not less than thirty (30)
days prior to the commencement thereof, and which consent shall not be
unreasonably withheld by Landlord. Landlord may condition its consent
on, among other things, the installation of additional risers, feeders
and other appropriate equipment as well as utility meters. The
installation, maintenance, repair and replacement, as well as all
charges in connection with all such meters and equipment shall be at
Tenant's sole cost and expense. The construction of the initial
improvements to the Premises shall be governed by the terms of the
Tenant Work Letter, attached hereto as Exhibit B, and not the terms of
this Article 7.
7.4 To the extent Landlord designates at the time Landlord approves such
Alterations, all or any part of the Alterations, whether made with or
without the consent of Landlord, shall, at the election of Landlord,
either be removed by Tenant at its expense before the expiration of
the Term or shall remain upon the Premises and be surrendered
therewith at the Expiration Date or earlier termination of this Lease
as the property of Landlord without disturbance or injury. If
Landlord, at the time of Landlord's consent, requires the removal of
all or part of any Alterations, Tenant, at its expense, shall remove
such Alterations and shall repair any damage to the Premises or the
Building caused by such removal. If Tenant fails to remove the
Alterations if required to do so as provided above, then Landlord may
(but shall not be obligated to) remove them and the cost of removal
and repair of any damage together with all other damages which
Landlord may suffer by reason of the failure of Tenant to remove
Alterations, shall be paid by Tenant to Landlord upon demand. Tenant
shall not be entitled to any compensation from Landlord for any
Alterations removed by Landlord or at Landlord's direction.
7.5 Tenant shall construct all such Alterations and perform any and all
repairs and/or remediation required under this Lease in conformance
with any and all applicable rules and regulations of any federal,
state, county or municipal code or ordinance or any agency guidelines,
and pursuant to a valid building permit, issued by the applicable
municipality, in conformance with Landlord's construction rules and
regulations. If such Alterations or repairs will involve the use of,
reveal, or disturb Hazardous Materials (as that term is defined in
Section 41.1 of this Lease) existing in the Premises, Tenant shall
comply with Landlord's rules and regulations concerning such Hazardous
Materials. Landlord's consent to such Alterations or Landlord's
approval of the plans, specifications, and working drawings for such
Alterations will create no responsibility or liability on the part of
Landlord for the completeness, design, sufficiency or compliance with
all laws, rules and regulations of governmental agencies or
authorities (including without limitation the Americans With
Disabilities Act of 1990 and the provisions of that Act applicable to
the Project or any part of it) with respect to such Alterations. All
work with respect to any Alterations must be done in a good and
workmanlike manner and diligently prosecuted to completion to the end
that the Premises shall at all times be a complete unit except during
the period of work. In performing the work of any such Alterations,
Tenant shall have the work performed in such manner as not to obstruct
access to the Building or the Common Areas for any other tenant of the
Building, and as not to obstruct the business of Landlord or other
tenants in the Building, or interfere with the labor force working in
the Building. Not less than fifteen nor more than twenty days prior to
commencement of any Alterations, Tenant shall notify Landlord in
writing of the work commencement date so that
15
Landlord may post notices of nonresponsibility about the Premises.
Upon completion of any Alterations, Tenant agrees to cause a Notice of
Completion to be recorded in the office of the Recorder of the County
of Los Angeles in accordance with Section 3093 of the Civil Code of
the State of California or any successor statute, and Tenant shall
deliver to the Building management office a reproducible copy of the
"as built" drawings of the Alterations.
7.6 The charges for work requested by Tenant and performed by a contractor
selected by Landlord shall be deemed Rent under this Lease, payable
upon billing therefor, either periodically during construction or upon
the substantial completion of such work, at Landlord's option. Upon
completion of such work, Tenant shall deliver to Landlord evidence of
payment, contractors' affidavits and full and final waivers of all
liens for labor, services or materials. Tenant shall pay to Landlord a
percentage of the cost of such work sufficient to compensate Landlord
for all reasonable overhead, general conditions, directly attributable
fees and other reasonable costs and expenses arising from Landlord's
involvement with such work.
7.7 In the event that Tenant makes any Alterations, Tenant agrees to carry
"Builder's All Risk" insurance in a reasonable amount approved by
Landlord covering the construction of such Alterations, and such other
insurance as Landlord may require, it being understood and agreed that
all of such Alterations shall be insured by Tenant pursuant to Article
9 of this Lease immediately upon completion thereof. In addition,
Landlord may, in its discretion, require Tenant to obtain a lien and
completion bond or some alternate form of security satisfactory to
Landlord in an amount sufficient to ensure the lien-free completion of
such Alterations and naming Landlord a co-obligee.
8. FIRE OR CASUALTY DAMAGE
8.1 REPAIR OF DAMAGE TO PREMISES BY LANDLORD. If the Premises or any
portion of the Project is damaged by fire or other cause (the
"Occurrence") without the negligence or willful act of Tenant or its
partners, trustees, officers, directors, shareholders, members,
beneficiaries, licensees, invitees, or any subtenants or subtenants'
agents, employees, contractors, or invitees, servants, guests, or
independent contractors (collectively, "Tenant Persons"), Landlord
shall diligently, and as soon as practicable, repair the damage;
provided, however, that Landlord may elect not to rebuild or restore
the Premises or any portion of the Project, and instead terminate this
Lease, by notifying Tenant in writing of such termination within
forty-five (45) days after the date of the Occurrence, such notice to
include a lease termination date and a date for Tenant to vacate the
Premises, neither of dates shall be less than thirty (30) nor more
than ninety (90) days from the date of delivery of such notice.
Landlord may so elect to terminate this Lease only if the Building
shall be damaged by fire or other cause, whether or not the Premises
are affected, and one or more of the following conditions is present:
(i) repairs cannot reasonably be completed within one hundred eighty
(180) days after the Occurrence, and Landlord elects to terminate all
leases of all tenants of the Building similarly affected by the damage
or destruction; (ii) the Occurrence occurs during the last two (2)
Lease Years; (iii) the holder of any mortgage on the Building or
ground lessor with respect to the Project shall require that the
insurance proceeds or any portion thereof be used to retire all or a
portion of the mortgage debt, or shall terminate the ground lease, as
the case may be; (iv) Landlord's insurer has not agreed that the
damage is fully covered, except for deductible amounts, by Landlord's
insurance policies; or (v) in Landlord's sole discretion, fifty
percent
16
(50%) or more of the rentable floor area of the Project is unusable,
unmarketable, damaged or destroyed. If Landlord terminates this Lease,
the Base Rent and Tenant's Proportionate Share of increases in
Operating Costs (collectively, "Periodic Rent") shall be apportioned
and paid to the date of termination (subject to abatement as provided
below). Such repair or restoration by Landlord shall be to
substantially the same condition of the base, shell, and core of the
Premises and common areas prior to the casualty, except for
modifications required by zoning and building codes and other laws or
by the holder of a mortgage on the Building, or the lessor of a ground
or underlying lease with respect to the Project or portion thereof, or
any other modifications to the common areas reasonably deemed
desirable by Landlord, which are consistent with the character of the
Project, provided access to the Premises and any common restrooms
serving the Premises shall not be materially impaired. Notwithstanding
any other provision of this Lease, upon the occurrence of any damage
to the Premises, Tenant shall assign to Landlord (or to any party
designated by Landlord) all insurance proceeds payable to Tenant under
Tenant's insurance required under Section 9.1 of this Lease, and
Landlord shall repair any injury or damage to the tenant improvements
installed in the Premises and shall return such tenant improvements to
their condition prior to the Occurrence; provided that if the cost of
such repair by Landlord exceeds the amount of insurance proceeds
received by Landlord from Tenant's insurance carrier, as assigned by
Tenant, the cost of such repairs shall be paid by Tenant to Landlord
prior to Landlord's repair of the damage. In connection with such
repairs and replacements, Tenant shall, prior to the commencement of
construction, submit to Landlord, for Landlord's review and approval,
all plans, specifications and working drawings relating thereto, and
Landlord shall select the contractors to perform such improvement
work. Notwithstanding anything in the foregoing to the contrary, if
Landlord does not elect to terminate this Lease pursuant to Landlord's
termination right as provided above, and the repairs cannot, in the
reasonable opinion of Landlord, be completed within the 200 Day Period
(defined below), Tenant may elect, no earlier than forty-five (45)
days after the date of the damage and not later than ninety (90) days
after the date of such damage, to terminate this Lease by written
notice to Landlord effective as of the date specified in the notice,
which date shall not be less than thirty (30) days nor more than
ninety (90) days after the date such notice is given by Tenant.
8.2 TERMINATION BY EITHER PARTY
8.2.1 If neither Landlord nor Tenant elects to terminate this Lease
under the terms of Section 8.1, but the damage required to be
repaired by Landlord is not repaired by the end of the 180 Day
Period, then either Landlord or Tenant (subject to Section
8.2.2), within thirty (30) days after the end of the 180 Day
Period, may terminate this Lease by written notice to the other
party, in which event this Lease shall terminate as of the date
of receipt of the notice, and the Periodic Rent shall be
apportioned and paid to the date of termination (subject to
abatement as provided below). The "180 Day Period" shall mean the
period beginning on the date of the Occurrence and ending one
hundred eighty (180) days from the date of the Occurrence.
Notwithstanding the preceding provisions of Section 8.2.1, if (a)
Landlord has not elected to terminate this Lease pursuant to the
terms of Section 8.1, and (b) Landlord is proceeding to complete
the repairs, then neither party shall have the right to terminate
this Lease if, before the end of the 180 Day Period, Landlord, at
Landlord's sole option, gives written notice to Tenant that the
repairs will be completed within thirty (30) days after the end
of the 180 Day Period, and the repairs are actually completed
within such thirty day period. If the repairs are not completed
within thirty days after the end of the 180 Day Period,
17
then either party may terminate this Lease by written notice to
the other party. Such notice of termination shall be given within
sixty (60) days after the end of the 180 Day Period, and shall be
effective upon receipt thereof by the other party to this Lease.
8.2.2 Notwithstanding the provisions of Section 8.2.1, Tenant shall
have the right to terminate this Lease under Section 8.2.1 only
if each of the following conditions is satisfied: (a) the damage
to the Project by fire or other casualty was not caused by the
gross negligence or intentional act of Tenant Persons; (b) there
is then no Default by Tenant; (c) as a result of the damage,
Tenant cannot reasonably conduct business from the Premises; and,
(d) as a result of the damage to the Project, Tenant does not
occupy or use the Premises at all.
8.3 RENT ABATEMENT. Subject to the last sentence of this Section 8.3,
during the period that the damaged portion of the Premises is rendered
untenantable by the damage, Periodic Rent shall be reduced by the
ratio that the rentable square footage of the Premises thereby
rendered untenantable bears to the total rentable square footage of
the Premises, provided that (i) Tenant does not occupy or use such
untenantable portion of the Premises during such rent abatement
period, and (ii) Tenant shall, as soon as reasonably practicable after
the event purportedly giving rise to rent abatement, give written
notice to Landlord of Tenant's claim for rent abatement and the basis
therefor, including the date when Tenant vacated the Premises or
portion thereof as a result of the Occurrence. Notwithstanding the
preceding sentence, if the damage was the consequence of the fault or
negligence of any of the Tenant Persons, then the Periodic Rent shall
be abated only to the extent Landlord actually receives rental or
business interruption proceeds allocated to the Periodic Rent for the
Premises. If the rent abatement period expressly provided in this
Section 8.3 is for a period of less than five days, then Periodic Rent
for the first such five days shall be abated only to the extent that
Landlord actually receives rental or business interruption proceeds
allocable to such Periodic Rent to be abated.
8.4 TENANT LIABILITY FOR DAMAGES. Subject to Section 8.5, all injury or
damage to the Premises or the Building resulting from the gross
negligence or intentional acts of any Tenant Persons shall be repaired
at the sole cost of Tenant, payable on demand by Landlord, or at
Landlord's option, Landlord may require Tenant to perform such repairs
or portion thereof and Periodic Rent shall not xxxxx. If Landlord
shall so elect, Landlord shall have the right to make repairs to the
standard tenant improvements, not including any tenant extras,
Alterations, or personal property, and any expense incurred by
Landlord, together with interest thereon at the rate often percent
(10%) per year shall be paid by Tenant upon demand.
8.5 RELEASE TO EXTENT OF INSURANCE PROCEEDS. Notwithstanding any other
provisions of this Lease, and provided that any applicable insurance
coverage is not thereby invalidated, limited, or made more expensive,
Tenant shall be relieved from the obligation to repair or pay for
physical injury or damage to the Project resulting from the
negligence, gross negligence or intentional act of any of Tenant
Persons only to the extent that Landlord actually receives insurance
proceeds for complete payment in full for such repairs from Tenant's
or Landlord's insurance.
8.6 INSURANCE DEDUCTIBLE. Notwithstanding the preceding provisions in this
Article 8 concerning abatement of Periodic Rent, Tenant shall not be
relieved from its obligation
18
to pay Tenant's Proportionate Share of the insurance deductibles under
insurance policies carried by Landlord.
8.7 WAIVER OF STATUTES. The provisions of this Lease, including this
Article 8, constitute an express agreement between Landlord and Tenant
with respect to any and all damage to, or destruction of, all or any
part of the Premises, the Building, or any other portion of the
Project, and any statute or regulation of the State in which the
Building is located, including, without limitation, Sections 1932(2)
and 1933(4) of the California Civil Code, with respect to any rights
or obligations concerning damage or destruction in the absence of an
express agreement between the parties, and any other such statute or
regulation which may hereafter be in effect, shall have no application
to this Lease or any damage or destruction to all or any part of the
Premises, the Building, or any other portion of the Project.
9. INSURANCE
9.1 Tenant shall during the entire Term maintain the following insurance
coverage:
9.1.1 Commercial General Liability Insurance for personal injury and
property damage claims arising out of Tenant's occupation or use
of the Premises and from its business operations, and including
liability arising under any indemnity set forth in this Lease in
amounts of not less than $1 million for each occurrence and $2
million for all occurrences each year.
9.1.2 Property damage insurance covering all Tenant's furniture, trade
fixtures, office equipment, merchandise and other property in the
Premises and all original and later-installed tenant improvements
in the Premises. This insurance shall be an "all risk" policy
covering the full replacement cost of the items covered and
including vandalism, malicious mischief, earthquake sprinkler
leakage coverages.
9.1.3 The Tenant will maintain in force all required workers'
compensation or other similar insurance pursuant to all
applicable state and local statutes and regulations.
9.2 All insurance provided by Tenant under this Lease shall be coordinated
with any preceding, concurrent or subsequent, occurrence or claims
made insurance, in such a manner as to avoid any gap in coverage
against claims arising out of occurrences, conduct or events which
take place during the period beginning on the Lease Date and ending on
termination of this Lease.
9.3 Landlord makes no representation that the insurance coverage required
of Tenant provides adequate coverage for Tenant's needs or for its
obligations under this Lease. Tenant shall not do or permit to be done
anything which shall cause the cancellation of, invalidate, increase
the rate of, or otherwise adversely affect, the insurance policies
referred to in this Article 9.
9.4 Landlord shall not be deemed to have waived or reduced any of the
insurance coverage requirements for Tenant except by an express
written agreement to that
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effect. The receipt by Landlord or its contractors or agents of
insurance policies, certificates, letters, or other correspondence,
documents or information which do not conform to the insurance
requirements of this Lease, or the failure of Landlord to receive
policies, certificates, or other documentation required by this
Article 9, shall not be deemed to be Landlord's consent to a waiver or
reduction of any such requirements, despite any failure by Landlord to
object to same at the time of receipt (or lack of receipt), or
thereafter. Any reduction, modification, or waiver of any of Tenant's
insurance requirements under this Lease may be made only by a written
document signed by Landlord and Tenant which expressly amends the
pertinent described portions of this Lease.
9.5 Landlord shall have the right and option, but not the obligation, to
maintain any or all of the insurance which is required in Section 9.1
to be provided by the Tenant if Tenant fails to maintain the insurance
required of Tenant in this Article 9. All costs of Tenant's insurance
provided by the Landlord shall be obtained at Tenant's expense.
9.6 The minimum insurance requirements set forth in this Lease shall not
limit the liability of Tenant under this Lease. The Landlord, and any
parties specified by the Landlord, shall be named as additional
insureds under the Tenant's insurance. All insurance companies
providing insurance pursuant to this Article shall be rated at least
A-XII in Best's Key Rating Guide and shall be otherwise reasonably
acceptable to Landlord and licensed and qualified to do business in
the State of California. Insurance provided by the Tenant shall be
primary as to all covered claims and any insurance carried by Landlord
is excess and is non-contributing. Each Tenant's insurance policy must
not be cancelable or modifiable except upon thirty (30) days prior
written notice to Landlord and any specified mortgagee of Landlord.
The insurance must also contain a severability of interest clause
acceptable to Landlord. Copies of policies or original certificates of
insurance with respect to each policy shall be delivered to the
Landlord prior to the Commencement Date, and thereafter, at least
thirty (30) days before the expiration of each existing policy. Any
insurance required hereunder of Tenant may be provided with blanket
insurance policy(ies) insuring Tenant at locations in addition to the
Premises, so long as such blanket policy(ies) expressly affords the
coverage required of Tenant under this Lease. Tenant shall take all
necessary steps so as to prevent the actual effective aggregate
coverage of such blanket policy(ies) from ever being eroded at any
time by claims, or reserves therefor established by the insurer, so
that the minimum coverage afforded to Landlord required by this Lease
shall at all times remain in effect.
9.7 Landlord has the right at any time, but not the obligation, to
reasonably change, cancel, decrease or increase any insurance required
or specified under this Lease, upon thirty (30) days prior notice to
Tenant. Landlord at its option may obtain any of the required
insurance directly or through umbrella policies covering the Building
and other assets owned by Landlord.
9.8 Landlord and Tenant agree to request that their respective insurance
companies issuing property damage insurance waive any rights of
subrogation that such companies may have against Landlord or Tenant,
as the case may be, so long as the insurance carried by Landlord or
Tenant, respectively, is not invalidated thereby. As long as such
waivers of subrogation are contained in their respective insurance
policies, Landlord and Tenant hereby waive any right that either may
have against the other on account of any loss or damage to their
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respective property to the extent such loss or damage is actually
insured under policies of insurance for fire and all risk coverage,
theft, public liability, or other similar insurance.
10. WAIVER AND INDEMNIFICATION
To the extent not prohibited by law, Landlord, its partners, trustees,
ancillary trustees and their respective officers, directors, shareholders,
members, beneficiaries, agents, servants, employees, and independent
contractors (collectively, "Landlord Persons") shall not be liable for any
damage either to person or property or resulting from the loss of use
thereof, which damage is sustained by Tenant or by other persons claiming
through Tenant except for damage arising solely from the gross negligence
or intentional misconduct of Landlord Persons. Tenant agrees to indemnify,
defend, and hold Landlord harmless from all claims and all costs, including
reasonable attorneys' fees, expenses and liabilities, except those caused
solely by Landlord's negligence, arising or resulting from (a) any
accident, injury, death, loss or damage to any person or to any property
including the person and property of Tenant and its employees, agents,
officers, guests, and all other persons at any time in the Building or the
Premises or the Common Areas, (b) the occupancy or use of the Premises by
the Tenant, or (c) any act or omission or negligence of Tenant or any
agent, licensee, or invitee of Tenant, or its contractors, employees, or
any subtenant or subtenant's agents, employees, contractors, or invitees.
The indemnification obligations of Tenant under this Lease shall survive
the expiration or earlier termination of this Lease.
11. USE OF PREMISES
11.1 The Premises are leased to Tenant for the sole purpose set forth in
Section 1.10 and Tenant shall not use or permit the Premises to be
used for any other purposes without the prior written consent of
Landlord, which consent may be withheld in Landlord's sole and
absolute discretion. Tenant shall not allow occupancy density of use
of the Premises which is greater than the average density of the other
tenants of the Building. Tenant further covenants and agrees that it
shall not use, or permit any person or persons to use, the Premises or
any part thereof for any use or purpose contrary to the rules and
regulations, attached hereto as Exhibit D, or in violation of the laws
of the United States of America, the State of California, or the
ordinances, regulations or requirements of the local municipal or
county governing body or other lawful authorities having jurisdiction
over the Building. Landlord shall not be responsible to Tenant for the
nonperformance of any of such rules and regulations by or otherwise
with respect to the acts or omissions of any other tenants, guests or
occupants of the Building.
11.2 Tenant shall comply with all recorded covenants, conditions, and
restrictions now or hereafter affecting the real property underlying
the Project. Tenant shall, at its expense, obtain any governmental
permits or approvals required for Tenant's intended use of the
Premises except as may be expressly provided in Exhibit B. The
obtaining of any such permits or approvals is not a condition to any
of Tenant's obligations under this lease. Tenant acknowledges that
except as expressly stated in this Lease, neither Landlord nor
Landlord's agent has made any representation or warranty, whether
express or implied, as to the Premises, including, without limitation,
the suitability of the Premises for the conduct of Tenant's business.
Except as otherwise expressly provided in this Lease and Exhibit B
attached hereto, Tenant accepts the Premises in their AS IS condition
as of the Commencement Date, with all faults and defects.
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Tenant has been advised by Landlord to conduct its own investigation
of the suitability of the Premises for Tenant's intended use,
including, without limitation, a careful inspection of the Premises, a
review of all applicable laws and ordinances, and inquiries of all
applicable government agencies before executing this Lease.
12. SIGNS
12.1 GENERAL. Landlord retains absolute control over the exterior
appearance of the Building and Project and the exterior appearance of
the Premises as viewed from the public halls and public areas. Tenant
will not install, or permit to be installed, any drapes, furnishings,
signs, lettering, designs, advertising or any items that will in any
way alter the exterior appearance of the Building or the exterior
appearance of the Premises as viewed from the public halls and public
areas. Any sign, advertising, design, or lettering installed by Tenant
shall be considered an Alteration (as defined in Section 7.3) and
shall be subject to the provisions of Article 7. All signage rights
granted to Tenant under this Lease are personal, and may not be
assigned or transferred without Landlord's prior written consent,
which consent Landlord may withhold in its sole discretion. Tenant
shall be provided, at Tenant's sole cost and expense, Building
standard entry door signage at the entrance to the Premises.
12.2 BUILDING DIRECTORY. Tenant shall be provided, at Tenant's sole cost
and expense, one (1) line per each 1,000 rentable square feet
contained in the Premises to display Tenant's name and location in the
Building, and the names of Tenant's principal employees and subtenants
on the Building directory located in the lobby of the Building.
13. ASSIGNMENT AND SUBLETTING
13.1 Tenant shall not assign, transfer, mortgage or otherwise encumber this
Lease or sublet or rent (or permit a third party to occupy or use)
(collectively, a "Transfer") the Premises, or any part thereof, nor
shall any Transfer of this Lease or the right of occupancy be effected
by operation of law or otherwise, without the prior written consent of
Landlord which shall not be unreasonably withheld or delayed;
provided, however, that the parties hereby agree that it shall be
deemed to be reasonable under this Lease and under any applicable law
for Landlord to withhold consent to any proposed Transfer where,
without limitation as to other reasonable grounds for withholding
consent: (i) the transferee is of a character or reputation or engaged
in a business which is not consistent with the quality of the
Building; (ii) the transferee is either a governmental agency or
instrumentality thereof; (iii) the transferee is not a party of
reasonable financial worth and/or financial stability in light of the
responsibilities involved under this Lease on the date consent is
requested; (iv) the Transfer may result in a material increase in the
use of the utilities, services or Common Areas of the Project; (v) the
proposed assignee or sublessee is an existing tenant of the Building,
(vi) the proposed Transfer would cause a violation of another lease
for space in the Building, or would give an occupant of the Building a
right to cancel its lease, or (vii) Tenant is in default of this
Lease. For purposes of the foregoing prohibitions, a transfer at any
one time or from time to time of twenty percent (20%) or more of an
interest in Tenant (whether stock, partnership interest or other form
of ownership or control) by any person(s) or entity(ties) having an
interest in ownership or control of Tenant at the Lease Date shall be
deemed to be a Transfer of this Lease. Notwithstanding the foregoing,
however, neither an assignment of the Premises to a transferee which
is the resulting entity of a merger or
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consolidation of Tenant with another entity, nor an assignment or
subletting of all or a portion of the Premises to an affiliate of
Tenant (an entity which is controlled by, controls, or is under common
control with, Tenant), shall be deemed a Transfer, provided that
Tenant notifies Landlord in writing at least thirty days in advance of
any such assignment or sublease, and promptly supplies Landlord with
any documents or information reasonably requested by Landlord
regarding such Transfer or transferee, and that such assignment or
sublease is not a subterfuge by Tenant to avoid its obligations under
this Lease. Notwithstanding any provision of this Lease, or any
present or future law to the contrary, Landlord and Tenant hereby
expressly agree that if a court of competent jurisdiction determines
that Landlord unreasonably withheld consent to a proposed Transfer,
then Tenant's sole remedies for such breach by Landlord shall be
limited to a suit for contract damages (other than damages for injury
to, or interference with, Tenant's business including, without
limitation, loss of profits, however occurring) or termination of this
Lease as of the date of such court determination. If Landlord consents
to the proposed Transfer, (a) the initial Tenant, subsequent
transferees, and all guarantors shall remain liable under this Lease,
and Tenant shall obtain the prior written consent of any guarantor to
such Transfer in a form acceptable to Landlord; and (b) each of the
transferees shall agree in a writing acceptable to Landlord to assume
and be bound by all of the terms and conditions of this Lease. Any
Transfer without Landlord's written consent shall be voidable by
Landlord and, at Landlord's election, constitute an "Event of
Default," as that term is defined in Article 24 of this Lease. Neither
the consent by Landlord to any Transfer nor the collection or
acceptance by Landlord of Rent from any assignee, subtenant or
occupant shall be construed as a waiver or release of the initial
Tenant or any guarantor from the terms and conditions of this Lease or
relieve Tenant or any subtenant, assignee or other party from
obtaining the consent in writing of Landlord to any further Transfer.
Tenant hereby assigns to Landlord the Rent and other sums due from any
subtenant, assignee or other occupant of the Premises and hereby
authorizes and directs each such subtenant, assignee or other occupant
to pay such rent or other sums directly to Landlord; provided,
however, that until the occurrence of an Event of Default, Tenant
shall have the license to continue collecting such rent and other
sums.
If Landlord consents to a Transfer under this Section 13.1, Tenant
will pay Landlord's reasonable processing costs and reasonable
attorneys' fees incurred in giving such consent. If, for any proposed
Transfer, Tenant contracts to receive total Rent or other
consideration exceeding the total Rent called for hereunder (prorated
by the ratio that the assignment or sublease term and square footage
bears to the term and square footage of this Lease) after deduction
(amortized over the term of the assignment or sublease) of Tenant's
reasonable costs incurred by Tenant for (i) any changes, alterations
or improvements to the Premises made by Tenant or any improvement
allowances paid therefor by Tenant in connection with the Transfer and
(ii) any leasing brokerage commissions in connection with the
Transfer, Tenant will pay fifty percent (50%) of the excess to
Landlord as additional Rent promptly upon receipt.
13.2 In the event of a proposed assignment or subletting of Seventy-Five
percent (75%) or more of the Premises in the aggregate for the
remaining term of the Lease, Landlord shall also have the right, by
notice to Tenant, to terminate this Lease in the event of an
assignment as to all of the Premises and, in the event of a sublease,
as to the subleased portion of the Premises and to require that all or
part, as the case may be, of the Premises be surrendered to Landlord
for the balance of the Term (collectively "Recapture the Lease").
Notwithstanding the previous sentence, if, before entering into a
proposed assignment or sublease, Tenant gives
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written notice to Landlord of Tenant's intention to sublease or
assign, and Landlord does not, within five (5) business days after
Landlord's actual receipt of such written notice and all information
requested by Landlord relating to such proposed assignment or
subletting, inform Tenant that Landlord intends to Recapture the
Lease, then Landlord may not Recapture the Lease by reason of such
proposed assignment or subletting, provided that: (i) if Landlord
consents to the proposed assignment or subletting, Tenant shall
complete such assignment or sublease within one hundred twenty (120)
days after the end of such 15 day period, and (ii) nothing contained
in this Section 13.2 shall be deemed to waive any of Landlord's rights
to approve or disapprove a Transfer as provided in Section 13.1 of
this Lease.
14. EMINENT DOMAIN
In the event any portion of the Premises is taken from Tenant under eminent
domain proceedings, Tenant shall have no right, title or interest in any
award made for such taking, except for any separate award for fixtures and
improvements installed by Tenant and which have not become the property of
Landlord. If ten percent (10%) or more of the Premises or Building shall be
taken by power of eminent domain or condemned by any competent authority
for any public or quasi-public use or purpose, or if Landlord shall grant a
deed or other instrument in lieu of such taking by eminent domain or
condemnation, Landlord shall have the option to terminate this Lease upon
ninety (90) days notice, provided such notice is given no later than one
hundred eighty (180) days after the date of such taking, condemnation,
reconfiguration, vacation, deed or other instrument. Tenant hereby waives
any and all rights it might otherwise have pursuant to Section 1265.130 of
the California Code of Civil Procedure.
15. WAIVER AND SEVERABILITY
15.1 The consent of Landlord in any instance to any variation of the terms
of this Lease, or the receipt of Rent with knowledge of any breach,
shall not be deemed to be a waiver as to any breach of any Lease
covenant or condition, nor shall any waiver occur to any provision of
this Lease except in writing, mutually executed by Landlord or
Landlord's authorized agent and Tenant or Tenant's authorized agent.
The waiver or relinquishment by Landlord or Tenant of any right or
power contained in this Lease at any one time or times shall not be
considered a waiver or relinquishment of any right or power at any
other time or times. If Tenant tenders payment to Landlord of an
amount which is less than the Rent then due to Landlord, at Landlord's
option, Landlord may reject such tender, and such tender shall be void
and of no effect, or Landlord may accept such tender, without
prejudice to Landlord's right to demand the balance due. This Lease
constitutes the entire agreement of the parties and supersedes any and
all prior or contemporaneous written or oral negotiations,
correspondence, understandings and agreements between the parties
respecting the subject matter hereof. No supplement, modification or
amendment to this Lease shall be binding unless executed in writing by
both parties.
15.2 If any term or provision of this Lease or any application shall be
invalid or unenforceable, then the remaining terms and provisions of
this Lease shall not be affected.
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16. USE OF COMMON FACILITIES
As used in this Lease, "Common Areas" shall mean all areas within the
Project which are available for the common use of tenants of the Project
and which are not leased or held for the exclusive use of Tenant or any
other tenant. Common Areas include without limitation parking areas and
driveways, sidewalks, loading areas, lobbies, stairways, elevators, access
road, corridors, landscaped and planted areas. Use of the Common Areas may
be restricted by Landlord from time to time for purposes of repairs or
renovations.
17. SERVICES
17.1 Landlord shall furnish to the Premises throughout the Term (i)
electricity, heating and air conditioning appropriate for the Tenant's
use during the hours specified in Section 1.14, except for legal
holidays, observed by the federal government, (ii) reasonable
janitorial service, (iii) regular trash removal from the Premises,
(iv) hot and cold water from points of supply, (v) restrooms as
required by applicable code, and (vi) elevator service, provided that
Landlord shall have the right to remove such elevators from service as
may be reasonably required for moving freight or for servicing or
maintaining the elevators or the Building. (Notwithstanding the
preceding, water, electricity and elevator service shall be available
at all times, with adjustments as deemed appropriate by Landlord.) The
cost of all services provided by Landlord shall be included within
Operating Costs, unless charged directly (and not as a part of
Operating Costs) to Tenant or another tenant of the Building. Landlord
agrees to furnish landscaping and grounds maintenance for the areas
used in common by the tenants of the Building. Services shall be
furnished by Landlord and reimbursed by Tenant as part of Operating
Costs; however, Landlord shall be under no responsibility or liability
for failure or interruption in such services caused by breakage,
accident, strikes, repairs or for any other causes beyond the control
of Landlord, nor in any event for any indirect or consequential
damages; and failure or omission on the part of Landlord to furnish
service shall not be construed as an eviction of Tenant, nor work an
abatement of Rent, nor render Landlord liable in damages, nor release
Tenant from prompt fulfillment of any of the covenants under this
Lease.
17.2 If Tenant requires or requests that the services to be furnished by
Landlord (except Building standard electricity and elevator service)
be provided during periods in addition to the periods set forth in
Section 1.14, then Tenant shall obtain Landlord's consent and, if
consent is granted, shall pay upon demand the cost of such excess
consumption, the cost of the installation, operation, and maintenance
of equipment which is installed in order to supply or meter such
excess consumption, and the cost of the increased wear and tear on
existing equipment caused by such excess consumption. Landlord may,
from time to time during the Term, set a per hour charge for
after-hours service which shall include the cost of utility service,
labor costs, administrative costs and a cost for depreciation of the
equipment used to provide after-hours service.
17.3 All telephone, electricity, gas, heat and other utility service
furnished to the Premises shall be paid for by Tenant except to the
extent the cost is included within Operating Costs. Landlord reserves
the right to separately meter or monitor the utility services provided
to the Premises. The cost of any meter shall be borne by Tenant if, in
Landlord's reasonable judgment, Tenant maybe using a disproportionate
share of one or more utilities.
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17.4 In the event that Tenant is prevented from using, and does not use,
the Premises or any portion thereof, as a result of (i) any repair,
maintenance or alteration performed by Landlord, or which Landlord
failed to perform, after the Commencement Date and required by the
Lease, which substantially interferes with Tenant's use of the
Premises, or (ii) any failure to provide services, utilities or access
to the Premises, which substantially interferes with Tenant's use of
the Premises (either such set of circumstances as set forth in items
(i) or (ii), above, to be known as an "Abatement Event"), then Tenant
shall give Landlord notice of such Abatement Event, and if such
Abatement Event continues for five (5) consecutive business days after
Landlord's receipt of any such notice or ten (10) business days after
Landlord's receipt of any such notice in any twelve (12) month period
(the "Eligibility Period"), then Tenant's Periodic Rent and Tenant's
obligation to pay for parking shall be abated or reduced, as the case
may be, after expiration of the Eligibility Period for such time that
Tenant continues to be so prevented from using, and does not use, the
Premises or a portion thereof, in the proportion that the rentable
area of the portion of the Premises that Tenant is prevented from
using, and does not use, bears to the total rentable area of the
Premises; provided, however, in the event that Tenant is prevented
from using, and does not use, a portion of the Premises for a period
of time in excess of the Eligibility Period and the remaining portion
of the Premises is not sufficient to allow Tenant to effectively
conduct its business therein, and if Tenant does not conduct its
business from such remaining portion, then for such time after
expiration of the Eligibility Period during which Tenant is so
prevented from effectively conducting its business therein, Tenant's
Periodic Rent and Tenant's obligation to pay for parking for the
entire Premises shall be abated for such time as Tenant continues to
be so prevented from using, and does not use, the Premises. If,
however, Tenant reoccupies any portion of the Premises during such
period, the rent allocable to such reoccupied portion, based on the
proportion that the rentable area of such reoccupied portion of the
Premises bears to the total rentable area of the Premises, shall be
payable by Tenant from the date Tenant reoccupies such portion of the
Premises. Such right to xxxxx Periodic Rent shall be Tenant's sole and
exclusive remedy at law or in equity for an Abatement Event. Except as
provided in this Section 17.4, nothing contained herein shall be
interpreted to mean that Tenant is excused from paying Rent otherwise
due under this Lease.
18. ENTRY OF LANDLORD
Landlord reserves the right to enter upon the Premises at all reasonable
times, upon twenty-four (24) hours prior notice (except as provided below)
and reserves the right, during the last six (6) months of the Term, to show
the Premises at reasonable times to prospective tenants and to affix for
lease/rent signs to the Building at the Landlord's discretion. Landlord
may, without prior notice to Tenant, enter the Premises at any time for
purposes of repair or maintenance of the Premises or any portion of the
Project, or for the health, safety or protection of any person or property.
If deemed appropriate by Landlord for the health, safety or protection of
person or property, Tenant shall, upon notice from Landlord, vacate the
Premises as Landlord directs.
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19. INTENTIONALLY OMITTED
20. SUBORDINATION AND ATTORNMENT
This Lease is subject and subordinate to all ground or underlying leases
and to any first mortgage(s) which may now or hereafter affect those leases
or the land and to all renewals, modifications, consolidations,
replacements and extensions thereof. This subordination shall be
self-operative; however, Tenant shall execute and deliver within five (5)
business days any commercially reasonable instrument that Landlord or any
first mortgagee may request confirming subordination. Before any
foreclosure sale under a mortgage, the mortgagee shall have the right to
subordinate the mortgage to this Lease, and, in the event of a foreclosure,
this Lease may continue in full force and effect and Tenant shall attorn to
and recognize as its landlord the purchaser of Landlord's interest under
this Lease. Tenant shall, upon the request of a mortgagee or purchaser at
foreclosure, execute, acknowledge and deliver any commercially reasonable
instrument that has for its purpose and effect the subordination of the
lien of any mortgage to this Lease or Tenant's attainment to the purchaser.
21. ESTOPPEL CERTIFICATES
Tenant shall at any time upon not less than 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 Periodic Rent is paid in
advance, if any, and (ii) acknowledging that there are not, to Tenant's
knowledge, any uncured Landlord defaults, or specifying such defaults if
any are claimed. Any such statement may be conclusively relied upon by a
prospective purchaser or encumbrances of the Premises. Tenant's failure to
deliver this statement within such ten (10) day period shall be conclusive
upon Tenant (i) that this Lease is in full force, 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 Base Rent has been paid in advance. If Landlord desires to finance
or refinance the Project, or any part thereof, Tenant agrees to deliver to
any lender designated by Landlord such financial statements or other
information concerning Tenant as may be reasonably required by that lender,
including the past two years' financial statements. All such financial
statements shall be received by Landlord in confidence and shall be used
only for the specified purposes.
22. BUILDING RULES AND REGULATIONS
Tenant agrees to abide by all rules and regulations of the Building imposed
by Landlord. These regulations, presented as Exhibit D, are imposed for the
cleanliness, good appearance, proper maintenance, good order and reasonable
use of the Premises and the Building, and as may be reasonably necessary
for the proper enjoyment of the Building by all tenants and their clients,
customers and employees. The rules and regulations may be changed from time
to time by the Landlord on reasonable notice to Tenant.
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23. NOTICES
All notices or other communications between the parties shall be in writing
and shall be deemed duly given, (i) on the date of delivery, if delivered
in person, (ii) upon the earlier of receipt, if mailed by certified or
registered mail, or three (3) days after certified or registered mailing,
return receipt requested, postage prepaid, addressed and sent to the
parties at their addresses set forth in Sections 1.15 and 1.16, or (iii)
the date of delivery, if delivered to the parties at their addresses set
forth in Sections 1.15 and 1.16 by a nationally recognized overnight
courier. Landlord and Tenant may from time to time by written notice to the
other designate another address for receipt of future notices.
24. EVENTS OF DEFAULT
24.1 TENANT DEFAULT. Each of the following shall constitute an "Event of
Default": (i) Tenant fails to pay Rent within five (5) days following
receipt of written notice that such Rent is due, (ii) Tenant fails to
observe or perform any other Lease term, condition, obligation or
covenant binding upon, or required of Tenant, within thirty (30) days
after notice from Landlord, provided if the nature of such default is
such that the same cannot be reasonably cured within such thirty (30)
day period, Tenant shall not be in default hereunder if Tenant
commences to cure such default within such thirty (30) day period, and
diligently continues to cure and cures such default within a
reasonable period thereafter, (iii) Tenant or any guarantor of this
Lease makes or consents to a general assignment for the benefit of
creditors or a common law composition of creditors, or a receiver of
the Premises or all or substantially all of Tenant's or guarantor's
assets is appointed, (iv) Tenant or any guarantor files a voluntary
petition in any bankruptcy or insolvency proceeding, or an involuntary
petition in any bankruptcy or insolvency proceeding is filed against
Tenant or any guarantor, and is not discharged by Tenant or the
guarantor within sixty (60) days, or (v) there is a Transfer (as
defined in Article 13) of the Premises or the Lease by Tenant, without
the prior written consent of Landlord as required by Article 13.
24.2 LANDLORD DEFAULT. Notwithstanding anything to the contrary set forth
in this Lease, Landlord shall be in default in the performance of any
obligation required to be performed by Landlord pursuant to this Lease
if (i) in the event a failure by Landlord is with respect to the
payment of money, Landlord fails to pay such unpaid amounts within
five (5) business days of written notice from Tenant that the same was
not paid when due, or (ii) in the event a failure by Landlord is other
than the obligation to pay money, Landlord fails to perform such
obligation within thirty (30) days after the receipt of notice from
Tenant specifying in detail Landlord's failure to perform; provided,
however, if the nature of Landlord's obligation is such that more than
thirty (30) days are required for its performance, then Landlord shall
not be in default under this Lease if it shall commence such
performance within such thirty (30) day period and thereafter
diligently pursue the same to completion. Upon any such default by
Landlord under this Lease, Tenant may, except as otherwise
specifically provided in this Lease to the contrary, exercise any of
its rights provided at law or in equity.
28
25. LANDLORD'S REMEDIES
25.1 Upon the occurrence of an Event of Default, Landlord, at its option,
without further notice or demand to Tenant, shall have in addition to
all other rights and remedies provided in this Lease, at law or in
equity, the option to pursue any one or more of the following
remedies, each and all of which shall be cumulative and nonexclusive,
without any notice or demand whatsoever.
25.1.1 Terminate this Lease, in which event Tenant shall immediately
surrender the Premises to Landlord, and if Tenant fails to do so,
Landlord may, without prejudice to any other remedy which it may
have for possession or arrearages in Rent, enter upon and take
possession of the Premises and expel or remove Tenant and any
other person who may be occupying the Premises or any part
thereof, without being liable for prosecution or any claim or
damages therefor; and Landlord may recover from Tenant the
following:
25.1.1.1 The worth at the time of award of any unpaid rent which
has been earned at the time of such termination; plus
25.1.1.2 The worth at the time of award of the amount by which
the unpaid rent 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; plus
25.1.1.3 The worth at the time of award of the amount by which
the unpaid rent for the balance of the Term after the time
of award exceeds the amount of such rental loss that Tenant
proves could have been reasonably avoided; plus
25.1.1.4 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 which in the
ordinary course of things would be likely to result
therefrom, specifically including but not limited to,
brokerage commissions and advertising expenses incurred,
expenses of remodeling the Premises or any portion thereof
for a new tenant, whether for the same or a different use,
and any special concessions made to obtain a new tenant; and
25.1.1.5 At Landlord's election, such other amounts in addition
to or in lieu of the foregoing as may be permitted from time
to time by applicable law.
The term "RENT" as used in this Section 25.1 shall be deemed to be and to
mean all sums of every nature required to be paid by Tenant pursuant to the
terms of this Lease, whether to Landlord or to others, including, without
limitation, late charges and interest. As used in Sections 25.1.1(i) and
(ii), above, the "worth at the time of award" shall be computed by allowing
interest at the rate set forth in Section 25.3, below, but in no case
greater than the maximum amount of such interest permitted by law. As used
in Section 25.1.1(iii) above, the "worth at the time of award" shall be
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 (1%).
25.1.2 Landlord shall have 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 the right to sublet or
assign, subject only to
29
reasonable limitations). Accordingly, if Landlord does not
elect to terminate this Lease on account of any default by
Tenant, Landlord may, from time to time, without terminating
this Lease, enforce all of its rights and remedies under
this Lease, including the right to recover all rent as it
becomes due.
25.2 Whether or not Landlord elects to terminate this Lease on account of
any default by Tenant, as set forth in this Article 25, Landlord shall
have the right to terminate any and all subleases, licenses,
concessions or other consensual arrangements for possession entered
into by Tenant and affecting the Premises or may, in Landlord's sole
discretion, succeed to Tenant's interest in such subleases, licenses,
concessions or arrangements. In the event of Landlord's election to
succeed to Tenant's interest in any such subleases, licenses,
concessions or arrangements, Tenant shall, as of the date of notice by
Landlord of such election, have no further right to or interest in the
rent or other consideration receivable thereunder.
25.3 If Tenant fails to pay any Rent within five (5) days after the Rent
becomes due and payable, Tenant shall pay to Landlord a late charge
often percent (10%) of the amount of overdue Rent. In addition, any
late Rent payment shall bear interest from the date that Rent became
due and payable to the date of payment by Tenant at the interest rate
of fifteen percent (15%) per annum, provided that in no case shall
such rate be higher than the highest rate permitted by applicable law.
Late charges and interest shall be due and payable within two (2) days
after written demand from Landlord.
26. RIGHT OF LANDLORD TO CURE TENANT'S DEFAULT
If an Event of Default occurs, then Landlord may (but shall not be
obligated to) make such payment or do such act to cure the Event of
Default, and charge the expense, together with interest, at the interest
rate set forth in Section 25.3, to Tenant. Payment for the cure shall be
due and payable by the Tenant upon demand; however, the making of any
payment or the taking of such action by Landlord shall not be deemed to
cure the Event of Default or to stop Landlord from the pursuit of any
remedy to which Landlord would otherwise be entitled.
27. COMPLIANCE WITH LAW
Tenant shall not do anything or suffer anything to be done in or about the
Premises which will in any way conflict with any law, statute, ordinance or
other governmental rule, regulation, guideline or requirement now in force
or which may hereafter be enacted or promulgated. At its sole cost and
expense, Tenant shall promptly comply with all such governmental measures,
including, but not limited to, such measures set forth in Article 41 of
this Lease, below, other than the making of structural changes or changes
to the Building's life safety system, which shall be the sole obligation of
Landlord, except to the extent any such structural changes are required as
a result of Tenant's use of the Premises for other than general office uses
and/or as a result of any Alterations or Tenant Improvements installed by
or on behalf of Tenant. Should any standard or regulation now or hereafter
be imposed on Landlord or Tenant by a state, federal or local governmental
body charged with the establishment, regulation and enforcement of
occupational, health or safety standards for employers, employees,
landlords or tenants, then Tenant agrees, at its sole cost and expense, to
promptly cause the Premises to comply with such standards or regulations.
The judgment of any court of competent jurisdiction or the admission of
Tenant in
30
any judicial action, regardless of whether Landlord is a party thereto,
that Tenant has violated any of said governmental measures, shall be
conclusive of that fact as between Landlord and Tenant.
28. BENEFIT
Subject to the provisions of Article 13 hereof, the rights, duties and
liabilities created hereunder shall inure to the benefit of and be binding
upon the parties hereto, their heirs, personal representatives, successors
and assigns.
29. PROHIBITION AGAINST RECORDING
Except as provided in this Lease, neither this Lease, nor any memorandum,
affidavit or other writing with respect thereto, shall be recorded by
Tenant or by anyone acting through, under, or on behalf of Tenant, and the
recording thereof in violation of this provision shall make this Lease null
and void at Landlord's election.
30. TRANSFER OF LANDLORD'S INTEREST
Tenant acknowledges that Landlord has the right to transfer all or any
portion of its interest in the Project and Building and in this Lease, and
Tenant agrees that in the event of any such transfer and a transfer of the
security deposit, Landlord shall automatically be released from all
liability under this Lease and Tenant agrees to look solely to such
transferee for the performance of Landlord's obligations hereunder after
the date of transfer. Tenant further acknowledges that Landlord may assign
its interest in this Lease to a mortgage lender as additional security and
agrees that such an assignment shall not release Landlord from its
obligations hereunder and that Tenant shall continue to look to Landlord
for the performance of its obligations hereunder.
31. FORCE MAJEURE
Any prevention, delay or stoppage due to strikes, lockouts, labor disputes,
acts of God, inability to obtain services, labor or materials or reasonable
substitutes therefore, governmental actions, acts of terrorism, civil
commotions, fire or other casualty, and other causes beyond the reasonable
control of the party obligated to perform (collectively, the "Force
Majeure"), except with respect to the obligations imposed with regard to
Rent and other charges to be paid by Tenant pursuant to this Lease, and
Tenant's obligations under Articles 10, 11 and 27 of this Lease
notwithstanding anything to the contrary contained in this Lease, shall
excuse the performance of such party for a period equal to any such
prevention, delay, or stoppage and, therefore, if this Lease specifies a
time period for performance of an obligation of either party, that time
period shall be extended by the period of any delay in such party's
performance caused by a Force Majeure.
32. LANDLORD EXCULPATION
It is expressly understood and agreed that notwithstanding anything in this
Lease to the contrary, and notwithstanding any applicable law to the
contrary, the liability of Landlord hereunder (including any successor
landlord) and any recourse by Tenant against Landlord shall
31
be limited solely and exclusively to the interest of Landlord in and to the
Project and Building, and neither Landlord, nor any of its constituent
partners, shall have any personal liability therefor, and Tenant hereby
expressly waives and releases such personal liability on behalf of itself
and all persons claiming by, through or under Tenant. Under no
circumstances shall Landlord be liable for injury to Tenant's business or
for any loss of income or profit therefrom.
This Lease is being executed by CB Xxxxxxx Xxxxx Investors LLC ("CB Xxxxxxx
Xxxxx") on behalf of Landlord. No present or future officer, director,
employee, trustee, partner, member, manager, retirant, beneficiary,
internal investment contractor, investment manager or agent of Landlord
shall have any personal liability, directly or indirectly, and recourse
shall not be had against any such officer, director, employee, trustee,
partner, member, manager, retirant, beneficiary, internal investment
contractor, investment manager or agent under or in connection with this
Lease or any other document or instrument heretofore or hereafter executed
in connection with this Lease. Tenant hereby waives and releases any and
all such personal liability and recourse. The limitations of liability
provided in this ARTICLE 32 are in addition to, and not in limitation of,
any limitation on liability applicable to Landlord provided by law or in
any other contract, agreement or instrument. Tenant further acknowledges
that CB Xxxxxxx Xxxxx has entered into this Lease as agent for Landlord and
Tenant agrees that all persons dealing with CB Xxxxxxx Xxxxx must look
solely to Landlord (for which CB Xxxxxxx Xxxxx is acting as agent) for the
enforcement of any claims arising under this Lease (subject to the
limitations upon Landlord's liability set forth above), as neither CB
Xxxxxxx Xxxxx nor any of its affiliated entities (including, but not
limited to CB Xxxxxxx Xxxxx, Inc. and CB Xxxxxxx Xxxxx Services, Inc.) nor
any of their respective officers, directors, agents, managers, trustees,
employees, members, investment managers, partners or shareholders assume
any personal, corporate, partnership, limited liability company, or other
liability for any of the obligations entered into by CB Xxxxxxx Xxxxx as
agent for Landlord.
33. BUILDING RENOVATIONS
Tenant hereby acknowledges that Landlord is currently renovating or may
during the Term renovate, improve, alter, or modify (collectively, the
"Renovations") the Building and/or the Premises, which Renovations may
include, without limitation, (i) installing sprinklers in the Common Areas
and tenant spaces, (ii) modifying the Common Areas and tenant spaces to
comply with applicable laws and regulations, including regulations relating
to the physically disabled, and (iii) installing new carpeting, lighting,
and wall coverings in the Common Areas. Tenant hereby agrees that such
Renovations shall in no way constitute a constructive eviction of Tenant
nor entitle Tenant to any abatement of Rent. Landlord shall have no
responsibility, or for any reason be liable, to Tenant for any injury to or
interference with Tenant's business arising from the Renovations, nor shall
Tenant be entitled to any compensation or damages from Landlord for loss of
the use of the whole or any part of the Premises or of tenant's personal
property or improvements resulting from the Renovations, or for any
inconvenience or annoyance occasioned by such Renovations.
34. ATTORNEYS' FEES
If either party commences litigation against the other for the specific
performance of this Lease, for damages for breach hereof or otherwise for
enforcement of any remedy hereunder, the
32
parties hereto agree to, and hereby do waive any right to a trial by jury
and, in the event of any such commencement of litigation, the prevailing
party shall be entitled to recover from the other party such costs and
reasonable attorney's fees as may have been incurred, as well as reasonable
attorneys' fees and costs incurred in enforcing any judgment against the
non-prevailing party.
35. SURRENDER OF THE PREMISES
Tenant shall peaceably surrender the Premises to Landlord on the Expiration
Date or earlier termination of this Lease, in broom-clean condition and in
as good condition as when Tenant took possession, including, without
limitation, the repair of any damage to the Premises caused by the removal
of any of Tenant's personal property or trade fixtures from the Premises,
except for reasonable wear and tear and loss by fire or other casualty not
caused by Tenant or its agents, and subject to Section 7.4. Subject to
Section 7.4, any of Tenant's personal property left on or in the Premises,
the Building or the Common Areas for more than five (5) days after the
Expiration Date or earlier termination of this Lease shall be deemed to be
abandoned without any further notice whatsoever to Tenant by Landlord, and,
at Landlord's option, Landlord may dispose of said property in any manner
it deems appropriate, without compensation to Tenant, and title shall pass
to Landlord under this Lease. Landlord reserves the right to charge Tenant
all reasonable costs incurred by Landlord for the removal, storage and
disposition of any of Tenant's personal property left within any portion of
the Project, after deducting any proceeds earned by Landlord through the
disposition of said property, if any. Tenant hereby waives any rights it
may have under Sections 1980 through 1991 of the California Civil Code, or
any other statutes of similar import.
36. HOLDING OVER
In the event that Tenant shall not immediately surrender the Premises to
Landlord on the Expiration Date or earlier termination of this Lease,
Tenant shall be deemed to be a month to month tenant upon all of the terms
and provisions of this Lease, provided however, the monthly Base Rent shall
be one hundred fifty percent (150%) of the monthly Base Rent in effect
during the last month of the Term (except that if for such last month of
the Term, there was a rent credit or abatement, then the month immediately
prior thereto for which there was no such rent credit or abatement, shall
be used instead). The provisions of this Article 36 shall not be deemed to
limit or constitute a waiver of any other rights or remedies of Landlord
provided herein or at law. If Tenant shall hold over after the Expiration
Date or earlier termination of this Lease, and Landlord shall desire to
regain possession of the Premises, then Landlord may forthwith re-enter and
take possession of the Premises without process, or by any legal process in
force in the State of California, and Tenant shall protect, defend,
indemnify and hold Landlord harmless from all loss, costs (including
reasonable attorneys' fees) and liability resulting from Tenant's holding
over, including, without limiting the generality of the foregoing, any
claims made by any succeeding tenant founded upon such failure to surrender
and any lost profits to Landlord resulting therefrom.
37. JOINT AND SEVERAL
If there is more than one Tenant, the obligations imposed upon Tenant under
this Lease shall be joint and several.
33
38. GOVERNING LAW
This Lease shall be construed and enforced in accordance with the laws of
the State of California.
39. SUBMISSION OF LEASE
Submission of this instrument for examination or signature by Tenant does
not constitute a reservation of or an option for lease, and it is not
effective as a lease or otherwise until execution and delivery by both
Landlord and Tenant.
40. BROKERS
Landlord and Tenant hereby warrant to each other that they have had no
dealings with any real estate broker or agent in connection with the
negotiation of this Lease, excepting only the real estate brokers or agents
specified in Section 1.12 (the "Brokers"), and that they know of no other
real estate broker or agent who is entitled to a commission in connection
with this Lease. Each party agrees to indemnify and defend the other party
against and hold the other party harmless from any and all claims, demands,
losses, liabilities, lawsuits, judgments, and costs and expenses (including
without limitation reasonable attorneys' fees) with respect to any leasing
commission or equivalent compensation alleged to be owing on account of the
indemnifying party's dealings with any real estate broker or agent other
than the Brokers. The terms of this Article 40 shall survive the expiration
or earlier termination of the Term.
41. HAZARDOUS MATERIALS
41.1 As used in this Lease, the term "Hazardous Material" means any
flammable items, explosives, radioactive materials, biological
material, hazardous or toxic substances, material or waste or related
materials, including any substances defined as or included in the
definition of "hazardous substances", "hazardous wastes," "infectious
wastes," "hazardous materials" or "toxic substances" now or
subsequently regulated under any federal, state or local laws or
regulations including, without limitation, petroleum-based products,
printing inks, acids, pesticides, asbestos, PCBs and similar
compounds, mold, and including any different products and materials
which are subsequently found to have adverse effects on the
environment or the health and safety of persons.
41.2 Tenant shall not cause or permit any Hazardous Material to accumulate,
be generated, produced, brought upon, used, stored, treated or
disposed of in or about the Premises or the Project by Tenant, its
agents, employees, contractors, affiliates, sublessees or invitees.
Tenant shall indemnify, defend and hold Landlord harmless from all
actions (including, without limitation, remedial or enforcement
actions of any kind, and administrative or judicial proceedings and
orders or judgments), costs, claims, damages (including punitive
damages), expenses (including, attorneys', consultants' and experts'
fees, court costs) amounts paid in settlement, fines, forfeitures or
other civil, administrative or criminal penalties, injunctive or other
relief, liabilities or losses arising from a breach of this
prohibition by Tenant, its agents, employees, contractors, affiliates,
sublessees or invitees. Upon expiration or earlier termination of this
Lease, Tenant shall cause any Hazardous Materials arising out of or
related to the use or occupancy of the Premises by Tenant or its
agents, affiliates, customers, employees, business
34
associates or assigns to be removed from the Premises and the Project
and properly transported for use, storage or disposal in accordance
with all applicable laws, regulations and ordinances.
41.3 If, at any time during the Term of this Lease, Tenant knows, or has
reasonable cause to believe, that any form of Hazardous Material has
come to be located in, on or under the Premises, Tenant shall
immediately give written notice of such fact to Landlord, and provide
Landlord with a copy of any report, notice, claim or other
documentation which Tenant has, if any, concerning the presence of
such Hazardous Material.
42. LANDLORD'S RESERVATIONS
In addition to the other rights of Landlord under this Lease, Landlord
reserves the right to change the street address and/or name of the Building
without being deemed to be guilty of an eviction, actual or constructive,
or a disturbance or interruption of the business of Tenant or Tenant's use
or occupancy of the Premises.
43. PARKING
Tenant shall receive the use of the number of parking spaces set forth in
Section 1.17 upon Tenant's compliance with all parking rules and
regulations and upon payment of prevailing parking rates as in effect from
time to time. Tenant shall have the right to lease from Landlord for the
Tenant's use, additional spaces at the prevailing market rates established
from time to time by Landlord, as and when made available to Tenant by
Landlord. Tenant's parking rights and privileges are personal, and may not
be assigned or transferred without Landlord's prior written consent, which
consent Landlord may withhold in its reasonable discretion.
44. INTENTIONALLY OMITTED
45. CONFIDENTIALITY
Tenant acknowledges and agrees that the terms of this Lease and any future
amendments or other agreements in connection with this Lease are
confidential and constitute proprietary information of Landlord. Disclosure
of the terms could adversely affect the ability of Landlord to negotiate
other leases and impair Landlord's relationship with other tenants.
Accordingly, Tenant agrees that it, and its partners, agents,
representatives, officers, directors, employees and attorneys, shall not
disclose, either directly or indirectly, any of the terms or conditions of
this Lease or any future amendments or other agreements in connection with
this Lease, to any person or entity, except to personnel employed by
Tenant, as reasonably necessary for Tenant's performance of its obligations
under this Lease or for tax reporting purposes, and to prospective
subtenants or assignees under this Lease. The preceding provisions of this
paragraph shall not apply to, or bar or limit any legal action between
Tenant and the Landlord to enforce this Lease.
46. INTERPRETATION OF LEASE
Landlord and Tenant have had the opportunity to review and revise this
Lease. As such, this Lease shall be construed and interpreted as the joint
work product of Landlord and Tenant and/or their attorneys. The rule of
construction to the effect that any ambiguities are to be
35
resolved against the drafting party shall not be employed in any
interpretation of this Lease. This Lease and all of its terms shall be
construed equally as to Landlord and Tenant.
47. ACKNOWLEDGMENT, REPRESENTATION AND WARRANTY REGARDING PROHIBITED
TRANSACTIONS
Tenant hereby acknowledges that Landlord is a unit of the California State
and Consumer Services Agency established pursuant to Title I, Division 1,
Part 13 of the California Education Code, Sections 22000 et seq., as
amended (the "Ed Code"). As a result, Landlord is prohibited from engaging
in certain transactions with a "school district or other employing agency"
or a "member, retirant or beneficiary" (as those terms are defined in the
Ed Code). In addition, Landlord may be subject to certain restrictions and
requirements under the Internal Revenue Code, 26 U.S.C. Section 1 et seq.
(the "Code"). Accordingly, Tenant represents and warrants to Landlord that
(a) Tenant is neither a school district or other employing agency nor a
member, retirant or beneficiary; (b) has not made any contribution or
contributions to Landlord; (c) neither a school district or other employing
agency, nor a member, retirant or beneficiary, nor any person who has made
any contribution to Landlord, nor any combination thereof, is related to
Tenant by any relationship described in Section 267(b) of the Code; (d)
neither CB Xxxxxxx Xxxxx, its affiliates, related entities, agents,
officers, directors or employees, nor any Landlord's trustee, agent,
related entity, affiliate, employee or internal investment contractor (both
groups collectively, "Landlord Affiliates") has received or will receive,
directly or indirectly, any payment, consideration or other benefit from,
nor does any Landlord Affiliate have any agreement or arrangement with
Tenant or any person or entity affiliated with Tenant relating to the
transactions contemplated by this Lease; and (e) no Landlord Affiliate has
any direct or indirect ownership interest in Tenant or any person or entity
affiliated with Tenant.
36
IN WITNESS WHEREOF, the parties hereto have executed or caused this Lease
to be executed by their authorized agents as of the Lease Date.
"LANDLORD":
CSDV, LIMITED PARTNERSHIP,
a Delaware limited partnership
By: CB Xxxxxxx Xxxxx Investors LLC,
solely in its capacity as agent for
CSDV, LIMITED PARTNERSHIP
By:. /s/
-----------------------------------------
Authorized Signatory
By:. /s/
-----------------------------------------
Authorized Signatory
"TENANT":
ASTOR CAPITAL, INC.,
a California corporation
By:. /s/ Xxxxxxx Xxxxxx
-----------------------------------------
Xxxxxxx Xxxxxx,
President
By:. /s/ Xxx Xxxxxxxx
-----------------------------------------
Xxx Xxxxxxxx
Vice President
37
EXHIBIT A
GRAPHIC OMITTED
-1-
EXHIBIT B
TENANT WORK LETTER
This Tenant Work Letter shall set forth the terms and conditions relating
to the construction of the tenant improvements in the Premises. This Tenant Work
Letter is essentially organized chronologically and addresses the issues of the
construction of the Premises, in sequence, as such issues will arise during the
actual construction of the Premises. All references in this Tenant Work Letter
to Articles or Sections of "this Lease" shall mean the relevant portion of
ARTICLES 1 through 47 of the Standard Form Office Lease to which this Tenant
Work Letter is attached as EXHIBIT B and of which this Tenant Work Letter forms
a part, and all references in this Tenant Work Letter to Sections of "this
Tenant Work Letter" shall mean the relevant portion of SECTIONS 1 through 6 of
this Tenant Work Letter.
SECTION 1
LANDLORD'S INITIAL CONSTRUCTION IN THE PREMISES
1.1 BASE, SHELL AND CORE OF THE PREMISES AS CONSTRUCTED BY LANDLORD. Landlord
has constructed, at its sole cost and expense, the base, shell, and core
(i) of the Premises and (ii) of the floor of the Building on which the
Premises is located (collectively, the "Base, Shell, and Core"). The Base,
Shell and Core shall consist of those portions of the Premises which were
in existence prior to the construction of the tenant improvements in the
Premises for the prior tenant of the Premises. Subject to the terms of the
Lease and this Tenant Work Letter, Tenant shall accept the Base, Shell and
Core of the Premises in its As-Is condition as of the Commencement Date of
the Lease.
SECTION 2
TENANT IMPROVEMENTS
2.1 TENANT IMPROVEMENT ALLOWANCE. Tenant shall be entitled to a one-time tenant
improvement allowance (the "Tenant Improvement Allowance") in the amount of
$24.00 per usable square foot of the Premises for the costs relating to the
initial design and construction of Tenant's improvements which are
permanently affixed to the Premises (the "Tenant Improvements"). In
addition, Landlord has prepared at its sole cost and expense one (1)
preliminary space plan for the Premises. In no event shall Landlord be
obligated to make disbursements pursuant to this Tenant Work Letter in a
total amount which exceeds the Tenant Improvement Allowance and the amounts
incurred for the preliminary space plan above. All Tenant Improvements for
which the Tenant Improvement Allowance has been made available shall be
deemed Landlord's property under the terms of the Lease.
2.2 DISBURSEMENT OF THE TENANT IMPROVEMENT ALLOWANCE. Except as otherwise set
forth in this Tenant Work Letter, the Tenant Improvement Allowance shall be
disbursed by Landlord (each of which disbursements shall be made pursuant
to Landlord's disbursement process) for costs related to the construction
of the Tenant Improvements and for the following
EXHIBIT B
1
items and costs (collectively, the "Tenant Improvement Allowance Items"):
(i) payment of the fees of the "Architect" and the "Engineers," as those
terms are defined in SECTION 3.1 of this Tenant Work Letter, and payment of
the fees incurred by, and the cost of documents and materials supplied by,
Landlord and Landlord's consultants in connection with the preparation and
review of the "Construction Drawings," as that term is defined in SECTION
3.1 of this Tenant Work Letter; (ii) the cost of any changes in the Base,
Shell and Core when such changes are required by the Construction Drawings;
(iii) the cost of any changes to the Construction Drawings or Tenant
Improvements required by all applicable building codes (the "Code"); (iv)
the cost of any demolition of existing improvements in the Premises; (v)
the "Landlord Supervision Fee", as that term is defined in SECTION 4.3.2 of
this Tenant Work Letter; and (vi) a portion of the costs of the tenant
demising walls and public corridor walls and materials, if any, as
designated by Landlord.
2.3 STANDARD TENANT IMPROVEMENT PACKAGE. Landlord has established
specifications (the "Specifications") for the Building standard components
to be used in the construction of the Tenant Improvements in the Premises
(collectively, the "Standard Improvement Package"), which Specifications
shall be supplied to Tenant by Landlord. The quality of Tenant Improvements
shall be equal to or of greater quality than the quality of the
Specifications, provided that Landlord may, at Landlord's option, require
the Tenant Improvements to comply with certain Specifications. Landlord may
make changes to the Specifications for the Standard Improvement Package
from time to time.
2.4 Notwithstanding anything in the foregoing to the contrary, Landlord agrees
to bear any increased costs in the design or construction of the Tenant
Improvements directly resulting from the presence of Hazardous Materials in
the Premises and shall reimburse Tenant, in addition to and separate and
apart from the Tenant Improvement Allowance, any additional hard
construction costs incurred by Tenant because of the presence in the
Premises of Hazardous Materials prior to the date Tenant constructs the
Tenant Improvements. Any work necessary to remediate any Hazardous
Materials which interferes with Tenant's construction of the Tenant
Improvements shall be performed by Landlord at its sole cost.
SECTION 3
CONSTRUCTION DRAWINGS
3.1 SELECTION OF ARCHITECT/CONSTRUCTION DRAWINGS. Tenant shall retain the
architect/space planner designated by Landlord (the "Architect") to prepare
the "Construction Drawings," as that term is defined in this SECTION 3.1.
Tenant shall retain the engineering consultants designated by Landlord (the
"Engineers") to prepare all plans and engineering working drawings relating
to the structural, mechanical, electrical, plumbing, HVAC, lifesafety, and
sprinkler work of the Tenant Improvements. The plans and drawings to be
prepared by Architect and the Engineers hereunder shall be known
collectively as the "Construction Drawings." All Construction Drawings
shall comply with the drawing format and specifications as determined by
Landlord, and shall be subject to Landlord's approval. Tenant and Architect
shall verify, in the field, the dimensions and conditions as shown on the
relevant portions of the base Building plans, and Tenant and Architect
shall be solely responsible for the same, and Landlord shall have no
responsibility in connection therewith. Landlord's review of the
EXHIBIT B
2
Construction Drawings as set forth in this SECTION 3, shall be for its sole
purpose and shall not imply Landlord's review of the same, or obligate
Landlord to review the same, for quality, design, Code compliance or other
like matters. Accordingly, notwithstanding that any Construction Drawings
are reviewed by Landlord or its space planner, architect, engineers and
consultants, and notwithstanding any advice or assistance which may be
rendered to Tenant by Landlord or Landlord's space planner, architect,
engineers, and consultants, Landlord shall have no liability whatsoever in
connection therewith and shall not be responsible for any omissions or
errors contained in the Construction Drawings, and Tenant's waiver and
indemnity set forth in this Lease shall specifically apply to the
Construction Drawings.
3.2 FINAL SPACE PLAN. On or before the date set forth in SCHEDULE 1, attached
hereto, Tenant and the Architect shall prepare the final space plan for
Tenant Improvements in the Premises (collectively, the "Final Space Plan"),
which Final Space Plan shall include a layout and designation of all
offices, rooms and other partitioning, their intended use, and equipment to
be contained therein, and shall deliver the Final Space Plan to Landlord
for Landlord's approval.
3.3 FINAL WORKING DRAWINGS. On or before the date set forth in SCHEDULE 1,
Tenant, the Architect and the Engineers shall complete the architectural
and engineering drawings for the Premises, and the final architectural
working drawings in a form which is complete to allow subcontractors to bid
on the work and to obtain all applicable permits (collectively, the "Final
Working Drawings") and shall submit the same to Landlord for Landlord's
approval. Landlord shall, within ten (10) business days after Landlord's
receipt of the Final Space Plan, advise Tenant of its approval or
disapproval of the Final Space Plan. If Landlord disapproves the Final
Space Plan, Tenant may resubmit the Final Space Plan to Landlord within
three (3) business days, and Landlord shall approve or disapprove of the
resubmitted Final Space Plan, within five (5) business days after Landlord
receives such resubmitted Final Space Plan. Landlord's failure to timely
respond to Tenant within any applicable response period referenced herein
shall be deemed Landlord's approval of the Final Space Plan
3.4 PERMITS. The Final Working Drawings shall be approved by Landlord (the
"Approved Working Drawings") prior to the commencement of the construction
of the Tenant Improvements. Tenant shall immediately submit the Approved
Working Drawings to the appropriate municipal authorities for all
applicable building permits necessary to allow "Contractor," as that term
is defined in SECTION 4.1, below, to commence and fully complete the
construction of the Tenant Improvements (the "Permits"), and, in connection
therewith, Tenant shall coordinate with Landlord in order to allow
Landlord, at its option, to take part in all phases of the permitting
process and shall supply Landlord, as soon as possible, with all plan check
numbers and dates of submittal and obtain the Permits on or before the date
set forth in SCHEDULE 1. Notwithstanding anything to the contrary set forth
in this SECTION 3.4, Tenant hereby agrees that neither Landlord nor
Landlord's consultants shall be responsible for obtaining any building
permit or certificate of occupancy for the Premises and that the obtaining
of the same shall be Tenant's responsibility; provided however that
Landlord shall, in any event, cooperate with Tenant in executing permit
applications and performing other ministerial acts reasonably necessary to
enable Tenant to obtain any such permit or certificate of occupancy. No
changes, modifications or alterations in the Approved Working Drawings may
be made without the prior written consent of Landlord, provided that
Landlord may withhold its consent, in its sole discretion, to any change in
the Approved Working Drawings if such change would directly or
EXHIBIT B
3
indirectly delay the "Substantial Completion" of the Premises as that term
is defined in SECTION 5.1 of this Tenant Work Letter.
3.5 TIME DEADLINES. Tenant shall use its best, good faith, efforts and all due
diligence to cooperate with the Architect, the Engineers, and Landlord to
complete all phases of the Construction Drawings and the permitting process
and to receive the permits, and with Contractor for approval of the "Cost
Proposal," as that term is defined in SECTION 4.2 of this Tenant Work
Letter, as soon as possible after the execution of the Lease, and, in that
regard, shall meet with Landlord on a scheduled basis to be mutually agreed
by Landlord and Tenant, to discuss Tenant's progress in connection with the
same. The applicable dates for approval of items, plans and drawings as
described in this SECTION 3, SECTION 4, below, and in this Tenant Work
Letter are set forth and further elaborated upon in SCHEDULE 1 (the "Time
Deadlines"), attached hereto. Tenant agrees to comply with the Time
Deadlines.
SECTION 4
CONSTRUCTION OF THE TENANT IMPROVEMENTS
4.1 CONTRACTOR. A contractor designated by Landlord ("Contractor") shall
construct the Tenant Improvements, provided, however, Landlord shall select
at least three (3) qualified general contractors and competitively bid the
Tenant Improvement work among such contractors, and provided Tenant shall
have the right to designate XX Xxxxxx Construction as one of the three
bidding contractors, subject to Landlord's reasonable approval of such
contractors' qualifications. Each such Contractor shall be notified in the
bidding package of the time schedule for construction of the Tenant
Improvements. Landlord shall select the lowest bid (after adjustment for
inconsistent assumptions) received from such contractors.
4.2 COST PROPOSAL. After the Approved Working Drawings are signed by Landlord
and Tenant, Landlord shall provide Tenant with a cost proposal in
accordance with the Approved Working Drawings, which cost proposal shall
include, as nearly as possible, the cost of all Tenant Improvement
Allowance Items to be incurred by Tenant in connection with the design and
construction of the Tenant Improvements (the "Cost Proposal"). Tenant shall
approve and deliver the Cost Proposal to Landlord within five (5) business
days of the receipt of the same, and upon receipt of the same by Landlord,
Landlord shall be released by Tenant to purchase the items set forth in the
Cost Proposal and to commence the construction relating to such items. The
date by which Tenant must approve and deliver the Cost Proposal to Landlord
shall be known hereafter as the "Cost Proposal Delivery Date".
Notwithstanding the foregoing, Tenant shall have the right to object to
such Cost Proposal prior to the Cost Proposal Delivery Date by providing
the Landlord with written notice of such objection. In the event Tenant so
objects to the Cost Proposal, Tenant shall cause the Architect and/or
Engineers to revise the Construction Drawings (the "Revised Construction
Drawings") and, following the approval of the Revised Construction Drawings
by Landlord and Tenant, Landlord shall submit a revised Cost Proposal (the
"Revised Cost Proposal") to Tenant for its approval, provided any delay
caused by such objection shall be deemed to be a tenant delay, subject to
the terms of SECTION 5.2 below.
EXHIBIT B
4
4.3 CONSTRUCTION OF TENANT IMPROVEMENTS BY CONTRACTOR UNDER THE SUPERVISION OF
LANDLORD.
4.3.1 OVER-ALLOWANCE AMOUNT. On the Cost Proposal Delivery Date, Tenant
shall deliver to Landlord cash in an amount (the "Over-Allowance
Amount") equal to the difference between (i) the amount of the Cost
Proposal and (ii) the amount of the Tenant Improvement Allowance. The
Over-Allowance Amount shall be disbursed by Landlord prior to the
disbursement of any then remaining portion of the Tenant Improvement
Allowance, and such disbursement shall be pursuant to the same
procedure as the Tenant Improvement Allowance. In the event that,
after the Cost Proposal Delivery Date, any revisions, changes, or
substitutions shall be made to the Construction Drawings or the Tenant
Improvements, any additional costs which arise in connection with such
revisions, changes or substitutions or any other additional costs
shall be paid by Tenant to Landlord immediately upon Landlord's
request as an addition to the Over-Allowance Amount.
4.3.2 LANDLORD'S RETENTION OF CONTRACTOR. Landlord shall independently
retain Contractor, on behalf of Tenant, to construct the Tenant
Improvements in accordance with the Approved Working Drawings and the
Cost Proposal and Landlord shall supervise the construction by
Contractor, and Tenant shall pay a construction supervision and
management fee (the "Landlord Supervision Fee") to Landlord in an
amount equal to the product of (i) four percent (4%) and (ii) an
amount equal to the Tenant Improvement Allowance plus the Over-
Allowance Amount (as such Over-Allowance Amount may increase pursuant
to the terms of this Tenant Work Letter).
4.3.3 CONTRACTOR'S WARRANTIES AND GUARANTIES. Landlord hereby assigns to
Tenant all warranties and guaranties by Contractor relating to the
Tenant Improvements, and Tenant hereby waives all claims against
Landlord relating to, or arising out of the construction of, the
Tenant Improvements.
4.3.4 TENANT'S COVENANTS. Tenant hereby indemnifies Landlord for any loss,
claims, damages or delays arising from the actions of Architect on the
Premises or in the Building. Within ten (10) days after completion of
construction of the Tenant Improvements, Tenant shall cause Contractor
and Architect to cause a Notice of Completion to be recorded in the
office of the County Recorder of the county in which the Building is
located in accordance with Section 3093 of the Civil Code of the State
of California or any successor statute and furnish a copy thereof to
Landlord upon recordation, failing which, Landlord may itself execute
and file the same on behalf of Tenant as Tenant's agent for such
purpose. In addition, immediately after the Substantial Completion of
the Premises, Tenant shall have prepared and delivered to the Building
a copy of the "as built" plans and specifications (including all
working drawings) for the Tenant Improvements.
SECTION 5
COMPLETION OF THE TENANT IMPROVEMENTS; LEASE COMMENCEMENT DATE
5.1 READY FOR OCCUPANCY. The Premises shall be deemed "Ready for Occupancy"
upon the Substantial Completion of the Premises. For purposes of this
Lease, "Substantial Completion" of the Premises shall occur upon the
completion of construction of the Tenant Improvements in the Premises
pursuant to the Approved Working Drawings, with the exception
EXHIBIT B
5
of any punch list items and any tenant fixtures, work-stations, built-in
furniture, or equipment to be installed by Tenant or under the supervision
of Contractor.
5.2 DELAY OF THE SUBSTANTIAL COMPLETION OF THE PREMISES. Except as provided in
this SECTION 5.2, the Lease Commencement Date shall occur as set forth in
the Lease and SECTION 5.1, above. If there shall be a delay or there are
delays in the Substantial Completion of the Premises or in the occurrence
of any of the other conditions precedent to the Lease Commencement Date, as
set forth in the Lease, as a direct, indirect, partial, or total result of:
5.2.1 Tenant's failure to comply with the Time Deadlines;
5.2.2 Tenant's failure to timely approve any matter requiring Tenant's
approval;
5.2.3 A breach by Tenant of the terms of this Tenant Work Letter or the
Lease;
5.2.4 Changes in any of the Construction Drawings because the same do not
comply with Code or other applicable laws;
5.2.5 Tenant's request for changes in the Approved Working Drawings;
5.2.6 Tenant's requirement for materials, components, finishes or
improvements which are not available in a commercially reasonable time
given the anticipated date of Substantial Completion of the Premises,
as set forth in the Lease, or which are different from, or not
included in, the Standard Improvement Package;
5.2.7 Changes to the Base, Shell and Core required by the Approved Working
Drawings; or
5.2.8 Any other acts or omissions of Tenant, or its agents, or employees;
then, notwithstanding anything to the contrary set forth in the Lease
or this Tenant Work Letter and regardless of the actual date of the
Substantial Completion of the Premises, the date of the Substantial
Completion of the Premises shall be deemed to be the date the
Substantial Completion of the Premises would have occurred if no
Tenant delay or delays, as set forth above, had occurred, provided,
however, that notwithstanding the foregoing, no Tenant delay shall be
deemed to have occurred unless and until Landlord has provided prior
written notice thereof to Tenant (the "Delay Notice"), specifying the
action or inaction by Tenant which Landlord contends constitutes the
Tenant delay and, if such action or inaction is not cured by Tenant
within the limit of the grace period set forth herein below (the
"Grace Period"), then a Tenant Delay as set forth in such Delay
Notice, shall be deemed to have occurred commencing as of the date the
Delay Notice is received by Tenant and continuing for the number of
days the construction of Tenant Improvements is in fact delayed as a
result of such action or inaction.
EXHIBIT B
6
SECTION 6
MISCELLANEOUS
6.1 TENANT'S ENTRY INTO THE PREMISES PRIOR TO SUBSTANTIAL COMPLETION. Provided
that Tenant and its agents do not interfere with Contractor's work in the
Building and the Premises, Contractor shall allow Tenant access to the
Premises prior to the Substantial Completion of the Premises for the
purpose of Tenant installing overstandard equipment or fixtures (including
Tenant's data and telephone equipment) in the Premises. Prior to Tenant's
entry into the Premises as permitted by the terms of this SECTION 6.1,
Tenant shall submit a schedule to Landlord and Contractor, for their
approval, which schedule shall detail the timing and purpose of Tenant's
entry. Tenant shall hold Landlord harmless from and indemnify, protect and
defend Landlord against any loss or damage to the Building or Premises and
against injury to any persons caused by Tenant's actions pursuant to this
SECTION 6.1.
6.2 FREIGHT ELEVATORS. Landlord shall, consistent with its obligations to other
tenants of the Building, make the freight elevator reasonably available to
Tenant in connection with initial decorating, furnishing and moving into
the Premises.
6.3 TENANT'S REPRESENTATIVE. Tenant has designated Xxxxxxx Xxxxxx and Xxx
Xxxxxxxx as its joint representatives with respect to the matters set forth
in this Tenant Work Letter, who, until further notice to Landlord, shall
have full authority and responsibility to act on behalf of the Tenant as
required in this Tenant Work Letter.
6.4 LANDLORD'S REPRESENTATIVE. Landlord has designated Xxxxx Xxxxxxxx as its
sole representative with respect to the matters set forth in this Tenant
Work Letter, who, until further notice to Tenant, shall have full authority
and responsibility to act on behalf of the Landlord as required in this
Tenant Work Letter.
6.5 TENANT'S AGENTS. Tenant shall not be required to retain union
subcontractors, laborers, materialmen, or suppliers.
6.6 TIME OF THE ESSENCE IN THIS TENANT WORK LETTER. Unless otherwise indicated,
all references herein to a "number of days" shall mean and refer to
calendar days. In all instances where Tenant is required to approve or
deliver an item, if no written notice of approval is given or the item is
not delivered within the stated time period, at Landlord's sole option, at
the end of such period the item shall automatically be deemed approved or
delivered by Tenant and the next succeeding time period shall commence.
6.7 TENANT'S LEASE DEFAULT. Notwithstanding any provision to the contrary
contained in this Lease, if an event of default as described in the Lease,
or a default by Tenant under this Tenant Work Letter, has occurred at any
time on or before the Substantial Completion of the Premises, then (i) in
addition to all other rights and remedies granted to Landlord pursuant to
the Lease, Landlord shall have the right to withhold payment of all or any
portion of the Tenant Improvement Allowance and/or Landlord may cause
Contractor to cease the construction of the Premises (in which case, Tenant
shall be responsible for any delay in the Substantial Completion of the
Premises caused by such work stoppage as set forth in SECTION 5 of this
Tenant Work
EXHIBIT B
7
Letter), and (ii) all other obligations of Landlord under the terms of this
Tenant Work Letter shall be forgiven until such time as such default is
cured pursuant to the terms of the Lease.
EXHIBIT B
8
SCHEDULE 1 TO EXHIBIT B
TIME DEADLINES
DATES ACTIONS TO BE PERFORMED
----- -----------------------
A. September 19, 2003. Final Space Plan to be completed
by Tenant and delivered to Landlord.
B. October 17, 2003. Tenant to deliver Final Working
Drawings to Landlord.
C. November 7, 2003. Tenant to deliver Permits to Contractor.
D. Five (5) business days Tenant to approve Cost Proposal and
after the receipt of the deliver Cost Proposal to Landlord.
Cost Proposal by Tenant
SCHEDULE 1 TO
EXHIBIT B
1
EXHIBIT C
NOTICE OF LEASE TERM DATES
To:
----------------------------
----------------------------
----------------------------
----------------------------
Re: Standard Form Office Lease dated _______________, 200___ between
____________________, a ____________________ ("Landlord"), and
____________________, a ____________________ ("Tenant") concerning
Suite ______ on floor(s) ________ of the office building located at
________________________, _____________________, California.
Gentlemen:
In accordance with the Standard Form Office Lease (the "Lease"), we wish to
advise you and/or confirm as follows:
1. The Premises are substantially completed, and the Term shall commence on
or has commenced on ___________________ for a term of ____________________
ending on ________________________.
2. Rent commenced to accrue on __________________, in the amount of
_______________.
3. If the Commencement Date is other than the first day of the month, the
first billing will contain a pro rata adjustment. Each billing thereafter, with
the exception of the final billing, shall be for the full amount of the monthly
installment as provided for in the Lease.
4. Your rent checks should be made payable to _______________
__________________ at ______________________________.
5. The exact number of rentable square feet within the Premises is
__________ square feet.
EXHIBIT C
1
6. Tenant's Proportionate Share as adjusted based upon the exact number of
rentable square feet within the Premises is __________%.
"Landlord":
a
----------------------------------
By:
--------------------------------
Its:
-----------------------------
By:
--------------------------------
Its:
-----------------------------
Agreed to and Accepted as
of _______________, 200__.
"Tenant":
------------------------------------
a
----------------------------------
By:
--------------------------------
Its:
-------------------------------
EXHIBIT C
2
EXHIBIT D
RULES AND REGULATIONS
Tenant shall faithfully observe and comply with the following Rules and
Regulations. Landlord shall not be responsible to Tenant for the nonperformance
of any of said Rules and Regulations by or otherwise with respect to the acts or
omissions of any other tenants or occupants of the Project.
1. Tenant shall not alter any lock or install any new or additional locks
or bolts on any doors or windows of the Premises without obtaining Landlord's
prior written consent. Tenant shall bear the cost of any lock changes or repairs
required by Tenant. Two keys will be furnished by Landlord for the Premises, and
any additional keys required by Tenant must be obtained from Landlord at a
reasonable cost to be established by Landlord.
2. All doors opening to public corridors shall be kept closed at all times
except for normal ingress and egress to the Premises.
3. Landlord reserves the right to close and keep locked all entrance and
exit doors of the Building during such hours as are customary for comparable
buildings in the greater Los Angeles area. Tenant, its employees and agents must
be sure that the doors to the Building are securely closed and locked when
leaving the Premises if it is after the normal hours of business for the
Building. Any tenant, its employees, agents or any other persons entering or
leaving the Building at any time when it is so locked, or any time when it is
considered to be after normal business hours for the Building, may be required
to sign the Building register. Access to the Building may be refused unless the
person seeking access has proper identification or has a previously arranged
pass for access to the Building. Landlord and his agents shall in no case be
liable for damages for any error with regard to the admission to or exclusion
from the Building of any person. In case of invasion, mob, riot, public
excitement, or other commotion, Landlord reserves the right to prevent access to
the Building or the Project during the continuance thereof by any means it deems
appropriate for the safety and protection of life and property.
4. No furniture, freight or equipment of any kind shall be brought into the
Building without prior notice to Landlord. All moving activity into or out of
the Building shall be scheduled with Landlord and done only at such time and in
such manner as Landlord designates. No service deliveries (other than messenger
services) will be allowed between hours of 4:00 p.m. to 6:00 p.m., Monday
through Friday. Landlord shall have the right to prescribe the weight, size and
position of all safes and other heavy property brought into the Building and
also the times and manner of moving the same in and out of the Building. Safes
and other heavy objects shall, if considered necessary by Landlord, stand on
supports of such thickness as is necessary to properly distribute the weight.
Landlord will not be responsible for loss of or damage to any such safe or
property in any case. Any damage to any part of the Building, its contents,
occupants or visitors by moving or maintaining any such safe or other property
shall be the sole responsibility and expense of Tenant.
EXHIBIT D
1
5. Tenant shall not place or install in the Premises any file cabinets,
equipment or other property which may cause damage to the structure of the
Project or any portion thereof. If Tenant wishes to place or install file
cabinets, equipment or other property which may cause damage to the structure of
the Project or portion thereof, such placement or installation shall be deemed
to be "Alterations" as defined in ARTICLE 7 of the Lease, and Tenant shall
obtain the prior written consent of Landlord, and Tenant shall be responsible
for, and shall pay all associated costs and expenses with respect to all
structural engineering and modifications required to prevent any potential
damage to the structure of the Project.
6. No furniture, packages, supplies, equipment or merchandise will be
received in the Building or carried up or down in the elevators, except between
such hours and in such specific elevator as shall be designated by Landlord.
7. At no time shall Tenant bring onto, or permit to exist within, any
portion of the Premises or the Project, any firearm, explosive device, bomb, or
other weapon or dangerous object or device.
8. The requirements of Tenant will be attended to only upon application at
the management office for the Project or at such office location designated by
Landlord. Employees of Landlord shall not perform any work or do anything
outside their regular duties unless under special instructions from Landlord.
9. Tenant shall not disturb, solicit, or canvass any occupant of the
Project and shall cooperate with Landlord and its agents of Landlord to prevent
the same.
10. The toilet rooms, urinals, wash bowls and other apparatus shall not be
used for any purpose other than that for which they were constructed, and no
foreign substance of any kind whatsoever shall be thrown therein. The expense of
any breakage, stoppage or damage resulting from the violation of this rule shall
be borne by the tenant who, or whose employees or agents, shall have caused it.
11. Tenant shall not overload the floor of the Premises, nor xxxx, drive
nails or screws, or drill into the partitions, woodwork or plaster or in any way
deface the Premises or any part thereof without Landlord's prior written
consent.
12. Except for vending machines intended for the sole use of Tenant's
employees and invitees, no vending machine or machines other than fractional
horsepower office machines shall be installed, maintained or operated upon the
Premises without the written consent of Landlord.
13. Tenant shall not use or keep in or on the Premises, the Building, or
the Project any kerosene, gasoline or other inflammable or combustible fluid or
material.
14. Tenant shall not without the prior written consent of Landlord use any
method of heating or air conditioning other than that supplied by Landlord.
15. Tenant shall not use, keep or permit to be used or kept, any foul or
noxious gas or substance in or on the Premises, or permit or allow the Premises
to be occupied or used in a manner offensive or objectionable to Landlord or
other occupants of the Project by reason of
EXHIBIT D
2
noise, nuisance, odors, or vibrations, or interfere in any way with other
tenants or those having business therein. Neither shall Tenant commit waste to
the Premises or the Project, or impair or interfere with the proper and economic
maintenance, operation and repair of the Project or any portion thereof.
16. Unless otherwise agreed in writing by Landlord, Tenant shall not use or
allow any part of the Premises to be used for the storage, manufacturing or sale
of food or beverages or for the manufacture, retail sale or auction of
merchandise, goods or property of any kind, or as a school or classroom, or for
any unlawful or objectionable purpose.
17. Tenant shall not bring into or keep within the Project, the Building or
the Premises any animals, birds, bicycles or other vehicles.
18. No cooking shall be done or permitted on the Premises, nor shall the
Premises be used for the storage of merchandise, for lodging or for any
improper, objectionable or immoral purposes. Notwithstanding the foregoing,
Underwriters' laboratory-approved equipment and microwave ovens may be used in
the Premises for heating food and brewing coffee, tea, hot chocolate and similar
beverages for employees and visitors, provided that such use is in accordance
with all applicable federal, state and city laws, codes, ordinances, rules and
regulations.
19. Landlord will approve where and how telephone and telegraph wires are
to be introduced to the Premises. No boring or cutting for wires shall be
allowed without the consent of Landlord. The location of telephone, call boxes
and other office equipment affixed to the Premises shall be subject to the
approval of Landlord.
20. 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 any of
these Rules and Regulations.
21. Tenant, its employees and agents shall not loiter in or on the
entrances, corridors, sidewalks, lobbies, halls, stairways, elevators, or any
Common Areas for the purpose of smoking tobacco products or for any other
purpose, nor in any way obstruct such areas, and shall use them only as a means
of ingress and egress for the Premises.
22. Tenant shall not waste electricity, water or air conditioning and
agrees to cooperate fully with Landlord to ensure the most effective operation
of the Building's heating and air conditioning system, and shall refrain from
attempting to adjust any controls.
23. Tenant shall store all its trash and garbage within the interior of the
Premises. No material shall be placed in the trash boxes or receptacles if such
material is of such nature that it may not be disposed of in the ordinary and
customary manner of removing and disposing of trash in the vicinity of the
Building without violation of any law or ordinance governing such disposal. All
trash, garbage and refuse disposal shall be made only through entry-ways and
elevators provided for such purposes at such times as Landlord shall designate.
24. Tenant shall comply with all safety, fire protection and evacuation
procedures and regulations established by Landlord or any governmental agency.
EXHIBIT D
3
25. Tenant shall assume any and all responsibility for protecting the
Premises from theft, robbery and pilferage, which includes keeping doors locked
and other means of entry to the Premises closed.
26. No awnings or other projection shall be attached to the outside walls
of the Building without the prior written consent of Landlord. No curtains,
blinds, shades or screens shall be attached to or hung in, or used in connection
with, any window or door of the Premises without the prior written consent of
Landlord. All electrical ceiling fixtures hung in offices or spaces along the
perimeter of the Building must be fluorescent and/or of a quality, type, design
and bulb color approved by Landlord. Tenant shall abide by Landlord's
regulations concerning the opening and closing of window coverings which are
attached to the windows in the Premises, if any, which have a view of any
interior portion of the Building or Common Areas.
27. The sashes, sash doors, skylights, windows, and doors that reflect or
admit light and air into the halls, passageways or other public places in the
Building shall not be covered or obstructed by Tenant, nor shall any bottles,
parcels or other articles be placed on the windowsills.
28. Tenant must comply with requests by Landlord concerning the informing
of their employees of items of importance to Landlord.
29. Tenant shall not permit or allow any vehicles that belong to or are
controlled by Tenant to be loaded, unloaded or parked in areas other than those
designated for such activities. Parking is prohibited in all areas not
designated therefor. Tenant shall comply with all directional signs and arrows
in the parking facility, and with all parking regulations and rules of the
parking service operator for the Project. Tenant acknowledges and agrees that
the parking service operator is a contractor and not an agent of Landlord. No
vehicle may be washed, serviced or repaired within the parking facility except
in an area (if any) specifically designated for such use. No inoperable vehicles
shall be kept in the parking facility.
Landlord reserves the right at any time to change or rescind any one or
more of these Rules and Regulations, or to make such other and further
reasonable Rules and Regulations as in Landlord's judgment may from time to time
be necessary for the management, safety, care and cleanliness of the Premises,
Building, and the Project, and for the preservation of good order therein, as
well as for the convenience of other occupants and tenants therein. Landlord may
waive any one or more of these Rules and Regulations for the benefit of any
particular tenants, but no such waiver by Landlord shall be construed as a
waiver of such Rules and Regulations in favor of any other tenant, nor prevent
Landlord from thereafter enforcing any such Rules or Regulations against any or
all tenants of the Project. Tenant shall be deemed to have read these Rules and
Regulations and to have agreed to abide by them as a condition of its occupancy
of the Premises.
EXHIBIT D
4
EXHIBIT E
FORM OF LETTER OF CREDIT
(Letterhead of a money center bank
acceptable to the Landlord)
_______________, 2000
[INSERT LANDLORD ADDRESS]
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Attention:
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Ladies and Gentlemen:
We hereby establish our unconditional, irrevocable Letter of Credit and
authorize you to draw on us at sight for the account of
_____________________________________________, the aggregate amount of
_______________________________________________________.
Funds under this Letter of Credit are available to the beneficiary hereof
as follows:
Any or all of the sums hereunder may be drawn down at any time and from
time to time from and after the date hereof by CSDV, LIMITED PARTNERSHIP, a
Delaware limited partnership ("Beneficiary") when accompanied by this Letter of
Credit and a written statement signed by Beneficiary, certifying that
Beneficiary is entitled to draw upon this Letter of Credit and a sight draft
executed by Beneficiary. Partial drawings of this Letter of Credit are
permitted.
This Letter of Credit is transferable in its entirety upon execution of our
transfer forms at no cost to Beneficiary. Should a transfer be desired, such
transfer will be subject to the return to us of this advice, together with
written instructions.
The amount of each draft must be endorsed on the reverse hereof by the
negotiating bank. We hereby agree that this Letter of Credit shall be duly
honored upon presentation and delivery of the certification specified above.
This Letter of Credit shall expire on ______________.
Notwithstanding the above expiration date of this Letter of Credit, the
term of this Letter of Credit shall be automatically renewed for successive,
additional one (1) year periods unless, at least thirty (30) days prior to any
such date of expiration, the undersigned shall give written notice to
Beneficiary, by certified mail, return receipt requested and at the address set
forth above or at such other address as may be given to the undersigned by
Beneficiary, that this Letter of
EXHIBIT E
1
Credit will not be renewed. Upon delivery of such notice, Beneficiary may draw
upon the entire amount of this Letter of Credit.
This Letter of Credit is governed by the Uniform Customs and Practice for
Documentary Credits (1983 Revision), International Chamber of Commerce
Publication 400.
Very truly yours,
(Name of Issuing
Bank)
By:
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EXHIBIT E
2