COVER PAGE
LEASE FOR 0000 XXXXXXXXX XXXXX
XXXXXXXX XXXX, XXXXXXXXXX
PARTIES:
LESSOR: Corporate Realty Income Fund I, L.P. LESSEE: LightCross, Inc.
State of Organization: Delaware State of Incorporation: California
Address for Notices: Address for Notices:
000 Xxxxx Xxxxxx, 00xx Floor 0000 Xxxxxxxxx Xxxxx
Xxx Xxxx, XX 00000 Xxxxxxxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxx, Xx. Attention: Xxx Xxxxx, Vice President
Administration and Legal Affairs
TERM:
Primary Term: Approximately 122 months
Commencement Date November 17, 2000
Rent Commencement Date: The later of January 1, 2001 or the date the Premises are
Substantially Complete.
Expiration Date: The last day of the 120th full month following the month
in which the Rent Commencement Date occurs.
Renewal Option
Renewal Term: Two 5-year Renewal Terms.
Renewal Term Commencement Date: The day immediately following the last day of the Primary
Term or the first Renewal Term, as applicable.
Date must be exercised in writing: Six months prior to the related Renewal Term Commencement
Date.
BUILDING AND LEASED SPACE:
Address of Building: 0000 Xxxxxxxxx Xxxxx
Xxxx, Xxxxx: Xxxxxxxx Xxxx, Xxxxxxxxxx 00000
Leased Space: Approximately 22,250 rentable square feet, as more
particularly described on Exhibit A-1 hereto.
LAND PARCEL:
Approximately 90,000 square feet, as more particularly
described in Exhibit A-2 hereto.
FIXED RENT:
Primary Term
Net Fixed Rent per month during the first $36,159.56 per month
year:
Annual Net Fixed Rent Year 1: $433,915.00
Year 2: $433,915.00
Year 3: $446,197.00
Year 4: $446,197.00
Year 5: $458,970.28
Year 6: $458,970.28
Year 7: $472,254.49
Year 8: $472,254.49
Year 9: $486,070.07
Year 10: $486,070.07
Total Net Fixed Rent during Primary Term: $4,594,813.68
Renewal Term
Net Fixed Rent: 100% of the then prevailing Fair Market Rental (as
defined in Section 23), subject to Section 3(b) hereof.
USE OF PREMISES: General office, optical networking design, development
and prototyping, clean room use and any other legally
permitted uses related thereto.
TABLE OF CONTENTS
Page
1. DEMISED PREMISES....................................................1
2. TERM, POSSESSION....................................................3
3. RENT................................................................4
4. SYSTEMS AND SERVICES................................................5
5. USE OF PREMISES; NET LEASE..........................................5
6. MAINTENANCE AND REPAIRS.............................................6
7. ALTERATIONS AND IMPROVEMENTS BY LESSEE..............................7
8. SIGNS...............................................................8
9. PARKING.............................................................8
10. ASSIGNMENT AND SUBLETTING...........................................8
11. GENERAL INDEMNIFICATION; INSURANCE.................................10
12. SUBORDINATION......................................................12
13. DAMAGE OR DESTRUCTION..............................................12
14. CONDEMNATION.......................................................14
15. ACCESS.............................................................14
16. DEFAULT BY LESSEE..................................................15
17. DEFAULT BY LESSOR..................................................17
18. HOLDING OVER.......................................................17
19. SURRENDER..........................................................17
20. NOTICES............................................................17
21. FINANCIAL INFORMATION..............................................18
22. QUIET ENJOYMENT....................................................18
23. RIGHT TO EXTEND....................................................18
24. TAXES..............................................................19
25. BROKERAGE..........................................................20
26. LIMITATION OF LIABILITY............................................20
27. SECURITY DEPOSIT...................................................21
28. ENVIRONMENTAL MATTERS..............................................22
29. RECORDING..........................................................23
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TABLE OF CONTENTS
(continued)
Page
30. LESSOR'S RIGHT TO CURE.............................................23
31. ESTOPPEL CERTIFICATES..............................................24
32. INTENTIONALLY OMITTED..............................................24
33. RIGHT OF FIRST OFFER...............................................24
34. MISCELLANEOUS......................................................24
Exhibit A-1 Leased Space
Exhibit A-2 Land Parcel
Exhibit B Form of Commencement Letter
Exhibit C Rules and Regulations
Exhibit D Form of Estoppel Certificate
Exhibit E Form of Subordination, Non-Disturbance and Attornment Agreement
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LEASE
for
0000 XXXXXXXXX XXXXX
XXXXXXXX XXXX, XXXXXXXXXX
THIS LEASE, made and entered into as of the 17th day of November, 2000 (together
with all amendments and supplements thereto, this "Lease") by and between
Corporate Realty Income Fund I, L.P., a limited partnership organized and
existing under the laws of the State of Delaware and having its principal office
and place of business at 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000, Attn:
Xxxxxx X. Xxxxxxx, Xx., as lessor (together with its successors and assigns,
hereinafter called "Lessor"), and LightCross, Inc., a California corporation,
having its principal office and place of business at the address set forth on
the cover page hereto, as lessee (together with its successors and permitted
assigns, hereinafter called "Lessee").
WITNESSETH:
Lessor desires to lease to Lessee and Lessee desires to lease from
Lessor, the Premises, as defined below. In consideration therefor and other
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereby covenant and agree as follows:
1. DEMISED PREMISES:
(a) Premises. Lessor does hereby lease and demise to Lessee, and
Lessee does hereby lease, hire and take from Lessor (i) 22,250 square feet of
net rentable space (the "Space") as shown on the plans and specifications
attached hereto as Exhibit A-1 and hereby made a part hereof, (ii) the building
known as 0000 Xxxxxxxxx Xxxxx, Xxxxxxxx Xxxx, XX (the "Building") and (iii) the
land parcel on which the Building is situated, as more particularly described on
Exhibit A-2 hereto (the "Land Parcel" and, together with the Space and the
Building, herein collectively called the "Premises") in the City of Monterey
Park, County of Los Angeles, and State of California; provided, however, that
the Premises shall be demised hereunder and subject to the terms and conditions
of this Lease on the Commencement Date, as defined below.
(b) Condition of Premises. Lessor represents and warrants that Lessor is
the fee owner of the Land Parcel and the Building and has full right and
authority to lease the Premises and to otherwise enter into this Lease on the
terms and conditions set out herein. Lessor shall deliver the Premises to Lessee
in compliance with all applicable laws, codes and regulations (including,
without limitation, Americans With Disabilities Act and codes regarding risks of
seismic activity, fire and life safety), and shall be responsible for any costs
and expenses incurred to satisfy the foregoing. Lessor warrants that the
heating, ventilating and air conditioning system for the Premises (the "HVAC
System") is in good working order and operating condition as of the Commencement
Date. Lessee represents and covenants that it shall (i) obtain and keep in full
force and effect all licenses, permits and approvals as are necessary to
commence and perform the Clean Room Work (as defined in the letter related to
improvements relating solely to the Clean Room entered into by the Lessor and
the Lessee, dated and delivered on the date hereof
(the "Lessee Clean Room Letter")) in compliance with applicable law, at its sole
cost and expense, and shall be responsible for the cost and expense (as defined
in the letter related to tenant improvements other than the Clean Room entered
into by Lessor and Lessee, dated and delivered on the date hereof (the "Lessor
Improvement Letter") as part of the Tenant Improvement Allowance, of Lessor
obtaining such licenses, permits and approvals as are necessary to perform
Lessor's Work and (ii) in addition thereto, obtain and keep in full force and
effect for the term of this Lease, at its sole cost and expense, all other
licenses, permits and approvals necessary to perform the intended use of the
Premises hereunder. Lessor represents that the electrical power to the Building
is 1200 amperes and Lessee certifies that it has satisfied itself that the
Premises has sufficient electrical service and/or power for Xxxxxx's intended
use thereof. Lessee shall be solely responsible for the costs and expenses to
obtain any electrical service and/or power at the Premises in addition to the
amperes referenced above and Lessee shall comply with the terms of this Lease
and all applicable law in obtaining such additional electrical service and/or
power. Lessor may, at the request and expense of Xxxxxx, assist Lessee in
obtaining such service and/or power with any governmental authorities and/or
other power and electric companies. In reliance upon on its review of the Level
I Environmental Site Assessment Report, dated September 22, 2000 by National
Assessment Corporation, Lessor represents and warrants that the Building does
not contain any Hazardous Substances (as defined in Section 28) in violation of
any Environmental Law. Lessee has reviewed a copy of such Environmental
Assessment Report, a copy of which was previously furnished to it. Lessor
represents that it has received all necessary approvals (and provided copies to
Lessee) from the City of Monterey Park and any other applicable governmental
agencies with respect to Xxxxxx's proposed uses of the Premises.
(c) Commencement Dates. The "Commencement Date" of this Lease shall be
November 17, 2000 and the "Rent Commencement Date" shall be the later of
February 1, 2001 or the date the Premises are Substantially Complete or the date
Lessee has accepted possession of the Premises hereunder for occupancy. Promptly
following the Rent Commencement Date, Lessor and Xxxxxx shall execute a letter
acknowledging that Xxxxxx has accepted possession, and reciting the exact Rent
Commencement Date and Expiration Date of the Lease, as defined in Section 2
below, a form of which is set forth on Exhibit B hereto. The failure by either
party, or both parties, to execute such letter shall not affect the rights or
obligations of either party hereunder. Such letter, when so executed and
delivered, shall be deemed to be a part of this Lease. The Premises shall be
deemed to be "Substantially Complete" when Lessor's architect certifies in
writing to Lessee that (i) except for immaterial punch list items, minor or
insubstantial construction, mechanical adjustment or decoration, the
non-completion of which will not materially interfere with Xxxxxx's normal use
of the Premises (other than the use of the Clean Room, as such space is
designated on Exhibit A hereto (the "Clean Room")), Lessor has completed
Lessor's Work, such work to be performed pursuant to the Lessor Improvement
Letter, (ii) all services and utilities serving the Premises are in full
operation, (iii) the parking lot located on the Land Parcel is accessible and
functioning, (iv) an unconditional certificate of occupancy (or its equivalent
if a certificate of occupancy is not otherwise available) issued by the
appropriate governmental authority has been issued with respect to the Premises
(other than with respect to the Clean Room) to the reasonable satisfaction of
Lessee, and (v) Lessee and its visitors shall have full access to the Premises
(other than with respect to the Clean Room) and the right to use the parking lot
located on the Land Parcel. Other than for Xxxxxx's Work and the
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delivery of the Premises consistent with the representations set forth in
Section 1(b), Lessor shall have no obligation for the completion of the
Premises. The Rent Commencement Date shall not be extended or delayed for any
reason due to Xxxxxx's election hereunder to undertake the Lessee's Clean Room
Work and the Premises shall be Substantially Complete if the conditions therefor
set forth in this Section 1(c) are satisfied but for such election and the
status of Lessee's Clean Room Work. In the event Lessor is unable to deliver
possession of the Premises to Lessee Substantially Complete, or the Premises is
otherwise not accepted by Xxxxxx for occupancy hereunder, on or before April 5,
2001 for any reason (but subject to delay due to force majeure (e.g., labor
strikes, earthquakes, acts of God, etc.) so long as Lessor has been attempting
to complete Lessor's Work with reasonable diligence and in good faith), then
Lessee may at its option reduce the Fixed Rent (as discussed below) by
delivering to Lessor written notice of its intention to do so within 10 days,
whereupon, unless such possession (or acceptance) is delivered during such 10
day period, the Lessee shall be entitled to Fixed Rent holiday equal to
$1,205.32 for each day thereafter that the Premises are not Substantially
Complete or the Premises is otherwise not accepted by Lessee for occupancy
hereunder. The aggregate amount of such Fixed Rent holiday shall be offset
against Xxxxxx's obligation to pay Fixed Rent for each day immediately following
the Rent Commencement Date until the aggregate holiday has been offset.
Subject to the Rules and Regulations set forth in Exhibit C hereto and
except as set forth in Sections 9, 13 and 14 hereof, the common and parking
areas in the Premises shall be at all times available for use by Lessee during
the full term of this Lease. Lessor reserves the reasonable right to change the
entrances, exits, traffic lanes and the boundaries and parking location areas
provided such changes do not materially alter Lessee's parking rights under this
Lease.
2. TERM, POSSESSION:
Term, Possession. The primary term of this Lease shall be for a period
of approximately one hundred and twenty two (122) months (the "Primary Term")
commencing on the Commencement Date and ending (a) on the last day of the 120th
month following the month in which the Rent Commencement Date occurs if such
date shall occur on the first day of a month, or (b) on the last day of the
121st month following the month in which the Rent Commencement Date occurs if
such date shall occur on a day other than the first day of a month (the
"Expiration Date"), unless sooner terminated as hereinafter provided. Subject to
Xxxxxx's exercise of the respective Renewal Options as set forth in Section 23
hereof, the term of this Lease shall be extended for two periods of five (5)
years (each, a "Renewal Term" and, together with the Primary Term herein
collectively referred to as the "Term" or "term"), commencing on the first day
immediately following the expiration of the Primary Term, with regard to the
initial Renewal Term, and the first day immediately following the expiration of
the initial Renewal Term, with regard to the second Renewal Term, in each case
unless sooner terminated as provided herein. Lessor shall deliver possession of
the Premises to Lessee on the Rent Commencement Date, free and clear of all
liens, broom clean and in good order and condition and with the Lessee
Improvements, as defined in, and made in accordance with, the Lessor Improvement
Letter.
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3. RENT:
(a) Fixed Rent. Xxxxxx agrees to pay to Lessor the annual net rental
for the Premises from the Rent Commencement Date and thereafter during the
Primary Term in amounts equal to the Annual Net Fixed Rent set forth on the
Cover Page of this Lease for the related year of the Primary Term (where each
such lease year is a full twelve-month period commencing on the first day of the
month in which Fixed Rent is payable hereunder), which Lessee agrees to pay to
Lessor in equal monthly installments, each in advance, on the first day of each
and every calendar month during the Primary Term of this Lease provided,
however, that in the event that the Rent Commencement Date shall occur on a date
other than the first day of a month, Xxxxxx agrees to pay Fixed Rent in advance
on a per diem basis from the Rent Commencement Date to the end of such month in
an amount equal to $1,205.32/day provided, further, however that such obligation
to pay Fixed Rent may be offset by any Fixed Rent holiday to which the Lessee is
entitled pursuant to Section 1(c) hereof. Subject to Section 3(b) hereof, upon
the exercise of the initial or subsequent Renewal Options and determination of
the respective Fair Market Rentals for the Premises for the applicable Renewal
Term pursuant to Section 23 hereof, Lessee agrees to pay to Lessor 100% of such
Fair Market Rental, which shall be on a net basis, for the related Renewal Term
in equal monthly installments in advance on the first day of each and every
calendar month during such Renewal Term of this Lease. The first full month of
Fixed Rent shall be paid by Lessee simultaneously with the execution and
delivery hereof by Xxxxxx. The foregoing installments of net rent set forth on
the Cover Page of this Lease under the header, Fixed Rent, are herein
collectively referred to as "Fixed Rent". All rent due or to become due
hereunder shall be paid to Lessor at its address first above written, unless
Lessor shall designate some other payee or address for the payment thereof by
giving written notice to that effect to Xxxxxx.
(b) Fixed Rent Adjustment During Renewal Term. The Fixed Rent payable
for any Renewal Term, as established in accordance with Sections 3(a) and 23
hereof, shall be increased as of the first day of the month immediately
following the second and fourth anniversary of the commencement date of such
applicable Renewal Term by an amount equal to four percent (4%) per annum of the
Fixed Rent then existing during the Renewal Term.
(c) Additional Rent In addition to paying Fixed Rent, Lessee shall be
responsible for and payment to Lessor of the payment and cost obligations set
forth in Sections 3(d), 11(b)(v), 16(a), 24(a), and 30 hereof (such payment
obligations (other than Fixed Rent) are herein called "Additional Rent").
Additional Rent together with Fixed Rent is herein collectively called "Rent".
In addition to paying such Additional Rent and consistent with Section
5(b) hereof, Lessee shall be responsible for and pay all costs and expenses
associated with its use, operation, occupancy, maintenance (including the
maintenance of the parking lot on the Land Parcel) and repair of the Premises or
any portion thereof, including, without limitation, payment of insurance, real
estate taxes, development and/or association fees in accordance with the terms
hereof, except for such costs and expenses which are payable by Lessor pursuant
to Sections 1(b), 4(a), 6(b), 13(b) and 14 hereof. Neither the Additional Rent
payable by Lessee to Lessor nor the foregoing costs and expenses payable by
Xxxxxx are intended to include the following (it being the intention of the
parties that this statement is not to be interpreted as contravening the
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net lease nature of this lease, as set forth in Section 5(b) hereof, but solely
as a clarification of costs and expenses for which Lessee shall not be
responsible): (i) interest, principal, points and fees on debts or amortization
on any mortgage or mortgages or any other debt instrument of Lessor encumbering
the Premises or any portion thereof; (ii) any management fees payable to Lessor;
or (iii) legal fees of counsel to Lessor or brokerage commissions incurred in
connection with the leasing of the Building.
(d) Late Charge. If any installment of Fixed Rent, Additional Rent or
any sum due from Lessee shall not be received by Lessor within ten (10) days
after said amount is due, Lessee shall pay to Lessor on demand a late charge of
three percent (3%) of such overdue amount. Lessee hereby acknowledges that late
payment by Xxxxxx to Lessor of Fixed Rent, Additional Rent or other sums due
hereunder will cause Lessor to incur costs which will be difficult to ascertain.
Such costs include, but are not limited to, processing and accounting charges,
attorneys' fees, and late charges which may be imposed upon Lessor by terms of
any mortgage or trust deed encumbering the Premises. Lessee shall pay on demand
twenty-five dollars ($25.00) for any check returned for insufficient funds. Any
monetary payment due Lessor hereunder, other than late charges, not received by
Lessor, when due as to scheduled payments (such as Fixed Rent) or within fifteen
(15) days following the date on which it was due for non-scheduled payment,
shall bear interest from the date when due, as to scheduled payments, or the
sixteenth (16) day after it was due as to non-scheduled payments to the date so
paid. The interest charged shall be equal to the prime rate reported in The Wall
Street Journal as published on the date prior to the date when due plus four
percent (4%), but shall not exceed the maximum rate allowed by law. All such
charges shall also be Rent hereunder.
4. SYSTEMS AND SERVICES:
(a) Systems. Lessee will be responsible for all maintenance or repair
of the HVAC System. Lessee shall maintain during the term of this Lease a
service contract for the maintenance of the HVAC System, reasonably acceptable
to Lessor. Notwithstanding the foregoing, Lessee shall not be responsible for
replacement, or the cost of replacement, of the following components due to wear
and tear during the term of this Lease: (i) replacement of the HVAC System as a
result of wear and tear, corrosion and/or rust or other permanent structural
failure where the cost to repair such unit would be in excess of forty percent
(40%) of the cost of a new unit; (ii) replacement of compressors, electrical
motors or coils due to wear and tear which may be accomplished by acquiring new
replacement units or by rebuilding existing units; and (iii) replacement of the
heat exchanger due to wear and tear which may be accomplished by acquiring a new
replacement unit or by rebuilding the existing unit.
(b) Payment for Services. Lessee will pay, directly to the applicable
utility supplier, all costs for water, gas and all utilities attributable to the
Premises and provide, at its own expense, janitorial and trash removal services
of Lessee's choice for the Premises after the commencement of this Lease and
during the term of this Lease.
5. USE OF PREMISES; NET LEASE:
(a) Use of Premises. The Premises shall be used only for the purpose
of offices, optical networking design, development and prototyping, clean room
use, in each case in
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compliance with all applicable laws, development agreements and/or restrictive
covenants and any other legally permitted uses related thereto which are not
hazardous and which will not be or become a nuisance. Lessee shall not do
anything not contemplated by this Section 5 which will cause a cancellation of
such insurance. Lessee shall not (i) use the Premises for any improper, immoral,
unlawful or objectionable purpose; (ii) permit any nuisance about the Premises;
nor (iii) place, permit or suffer to occur any lien or encumbrance on any
portion of the Premises or this Lease.
(b) Net Lease. This Lease is a "net lease" and Lessee shall pay all
Fixed Rent and Additional Rent without notice, demand, counterclaim, set-off,
deduction, or defense, and without abatement, suspension, deferment, diminution
or reduction, free from any charges, assessments, impositions, expenses or
deductions of any and every kind or nature whatsoever, including, without
limitation (1) any right Lessee may have against Lessor, any contractor or any
other person for any reason (whether in connection with this transaction or any
other transaction), (2) any breach, default or misrepresentation by Lessor or
any other person under this Lease, or (3) any invalidity or unenforceability of
any part of this Lease or any other infirmity herein or therein, or any lack of
power or authority of any party to this Lease. Except as expressly set forth in
Sections 1(b), 4(a), 6(b), 13(b) and 14 hereof and, subject to the final
sentence of Section 3(c) hereof, all costs, expenses and obligations of every
kind and nature whatsoever relating to the Premises and the appurtenances
thereto and the use, operation, occupancy, management, maintenance (including
the maintenance of the parking lot on the Land Parcel) and repair thereof,
including, without limitation, the payment of insurance, real estate taxes,
development and/or association fees, with respect thereto by Lessee or anyone
claiming by, through or under Xxxxxx as lessee hereunder which may arise or
become due during or with respect to the period constituting the term hereof
shall be paid by Xxxxxx, and Xxxxxx shall indemnify the Indemnified Parties, as
defined in Section 11 hereof, against any of the foregoing as provided in
Section 11. Subject to the terms hereof, Xxxxxx assumes the sole responsibility
for the condition, use, operation, occupancy, management, maintenance (including
the maintenance of the parking lot on the Land Parcel) and repair of, including,
without limitation, the payment of insurance, real estate taxes, development
and/or association fees with respect to, the Premises and Lessee shall indemnify
the Indemnified Parties with respect to the foregoing as provided in Section 11.
Lessee waives all rights at any time conferred by statute or otherwise to quit,
terminate or surrender this Lease or the Premises (except as otherwise expressly
provided herein), or to any abatement (except as otherwise expressly set forth
in Section 13(b) hereof) or deferment of any Fixed Rent, Additional Rent or
other sum payable by Lessee hereunder. Lessee further waives all rights against
Lessor and any assignee of Lessor for damage, loss or expense suffered by Lessee
on account of any cause referred to in this Section 5, except to the extent
caused by the gross negligence or willful misconduct of Lessor or Lessor's
agents, employees, contractors, prospective purchasers or invitees.
6. MAINTENANCE AND REPAIRS:
(a) Lessee Repairs. Lessee shall, at Xxxxxx's sole cost and expense,
keep the Premises and every part thereof including, without limitation, the HVAC
System in as good condition and repair, ordinary wear and tear excepted, as at
the completion date of Lessee Improvements and the Lessee Clean Room Work,
subject to any alterations or improvements to the Premises under Section 7
hereto. In accordance with Section 7, Lessee shall, upon the
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expiration or earlier termination of this Lease, surrender the Premises to
Lessor in as good condition, broom clean, ordinary wear and tear excepted, as at
the completion date of Lessee Improvements and the Lessee Clean Room Work.
Except to the extent set forth in Sections 6(b), 13(b) and 14 hereof, Lessee
shall not be obligated to make structural repairs or repairs necessitated by
fire or other casualty or condemnation. Notwithstanding the foregoing, all
damage or injury to the Premises or to any other part thereof caused by the
negligence or willful misconduct of Lessee, its employees, agents, subtenants,
assignees or invitees shall be repaired promptly by Lessee at its sole cost and
expense, to the same condition before such event, to the satisfaction of Lessor
acting reasonably.
(b) Lessor Maintenance and Repairs. Lessor shall maintain at its sole
cost and expense (a) all structural aspects and portions of the Building,
including the exterior walls, load bearing walls, columns, foundations, floor
slab and subflooring, roof structure and membrane thereon, and (b) the
replacement obligations of the HVAC System as provided in Section 4(a) above,
unless the need for such maintenance and/or repairs are (i) caused by the act or
omission of any duty of Lessee, its agents, servants, employees, invitees,
subtenants or assignees, or (ii) necessitated by fire or other casualty to the
Premises in which case such repairs shall be made by Lessee in accordance with
Section 6(a) or Section 13, respectively. Except as set forth in Section 13,
there shall be no abatement of Rent and no liability of Lessor by reason of any
injury to or interference with Xxxxxx's business arising from the making of any
repairs, alterations or improvements except to the extent due to the gross
negligence or willful misconduct of Lessor or Lessor's agents, employees,
contractors, prospective purchasers or invitees.
7. ALTERATIONS AND IMPROVEMENTS BY XXXXXX:
In addition to Xxxxxx's rights set forth in the Lessee Clean Room
Letter, Lessee shall have the right, at its own expense, to make such
non-structural alterations and changes in and to the Premises as it shall deem
expedient or necessary for its purposes without the consent of Lessor as
provided herein. Lessee may make structural alterations and changes in, on, to
or about the Premises reasonably necessary for its purpose only if it has first
obtained the prior consent thereto of Lessor in writing, Lessor agreeing that it
shall not withhold such consent unreasonably. All such work shall be done in
good and workmanlike manner, and in accordance with all applicable laws,
regulations, codes, development agreements and/or restrictive covenants. Lessor
shall execute and deliver upon request of Lessee such instrument or instruments
embodying the approval of Lessor which may be required by any public or
quasi-public authority for the purpose of obtaining any license or permit for
the making of such alterations or changes in, to or upon said Xxxxxxxx, Lessee
agreeing to pay for such license or permit and any reasonable costs and expenses
of Lessor. Lessee shall keep the Premises free from any liens arising by,
through or under Lessee or in connection with such alterations or changes and
shall keep posted on the Premises, and shall personally serve upon contractors
and subcontractors, a notice stating that Xxxxxx's interest and any mortgagee's
interest in the Premises shall not be subject to any lien for any work done by
Lessee or anyone claiming by, through or under Lessee as lessee hereunder during
or with respect to the period constituting the Term hereof. Any such work
including wall covering and built-in kitchen cabinet work, but excepting movable
office furniture, partitions, paneling and trade fixtures, shall at once become
a part of the realty and belong to Lessor and shall be surrendered with the
Premises unless otherwise removed in accordance with the following sentence.
Prior to the expiration or early
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termination of this Lease, Lessee shall be responsible at its sole cost and
expense to remove any alteration and/or improvements made by it in, on, to, or
about the Premises including, without limitation, all of Lessee's Clean Room
Work. Any damage to the Premises as a result of such alterations or improvements
shall be promptly repaired by Lessee at its sole cost and expense. In the event
that Lessee, at the expiration or earlier termination of this Lease, shall fail
to comply with the provisions of this Section 7, then Lessor may remove any
alteration and/or improvements done by the Lessee without notice or demand to
the Lessee and Lessee shall pay to Lessor, upon written demand, the reasonable
costs and expenses incurred by Lessor to remove such alterations and
improvements including, without limitation, any costs incurred by Lessor to
repair any damage to the Premises caused by such removal.
8. SIGNS:
Lessee will not place any signs on the Premises or have any rights to
monument signage except as expressly set forth below. At Lessee's sole cost and
expense, Lessee shall have the right to install and affix signage on two sides
of the Building top and on any monument that may be erected on the Land Parcel
subject to Lessee obtaining the prior approval of all applicable governmental
authorities, development associations and of Lessor, which consent of Lessor
shall not be unreasonably withheld. Lessor may assist Lessee in obtaining the
approvals from such governmental authorities and/or development associations.
Lessor shall be entitled to seek reimbursement from Lessee for Xxxxxx's
reasonable costs and expenses in providing such assistance. Such right to
install and affix signage may be transferred or assigned by Lessee to any
permitted sublessee or assignee hereof which right shall continue to be subject
to the same terms and conditions hereto. Lessee shall have the right, at its
cost and expense, to include its name and key employees on any directory board
which may be installed inside the Building. In the event a sign or signs are
placed upon the Premises or a monument is installed, Lessee will comply with all
applicable laws, ordinances, development agreements or restrictive covenants, in
addition to the Rules and Regulations set forth on Exhibit C, will remove all
such signs upon termination of this Lease and upon removal will then restore
Premises to their original condition.
9. PARKING:
As further consideration for the Rent to be paid by Lessee hereunder,
Lessor hereby grants to Lessee, the right to use the parking spaces in the
parking lot located on the Land Parcel and adjacent to the Building. In the
event that Lessee desires more parking spaces, Lessee shall have the sole
responsibility and cost to secure such spaces. Lessee, in securing such spaces
shall act in accordance with the terms of this Lease, applicable development
agreements and/or restrictive covenants and with all applicable laws. Lessor may
assist Lessee in obtaining any approvals and/or permits in connection with such
additional parking and Lessor shall be entitled to seek reimbursement from
Lessee for its reasonable costs and expenses in providing such assistance.
10. ASSIGNMENT AND SUBLETTING:
(a) Lessee shall not assign, encumber or sublease its interest under
this Lease without the prior written consent of Lessor, except that Lessee may
(i) assign 100% of its interest under this Lease, or (ii) sublease the Premises,
in whole or in part, without the prior written consent of
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Lessor so long as such assignment or sublease is made to or with an affiliate or
subsidiary of Lessee, or any entity which is either wholly or partially owned or
controlled by the shareholders of Lessee (each a "Lessee Affiliate"). A merger
or consolidation by Lessee with or into a third party shall constitute an
assignment of this Lease but shall not be subject to Section 10(b) hereof. Any
assignment or sublease hereof shall satisfy the conditions set forth in this
Section 10. No such assignment or subletting shall affect or reduce any
obligations of Lessee or rights of Lessor hereunder and all obligations of
Lessee hereunder shall continue in full force and effect as the obligations of a
principal and not of a guarantor or surety, as though no assignment or
subletting had been made.
(b) During the Term, Lessee may assign or sublease all or a portion of
the Premises upon the following terms and conditions: Lessee (i) shall, at least
30 days prior to the execution of any such assignment or sublease, deliver to
Lessor notice of Lessee's intention to assign or sublet, which shall include the
identity of the proposed assignee or sublessee, the most recent annual and
quarterly financial statements of the proposed assignee or sublessee (if not a
Lessee Affiliate), a copy of such proposed assignment or sublease and such other
information as Lessor may reasonably request, (ii) shall obtain the prior
written consent of Lessor to the proposed assignee and assignment or sublessee
and sublease, as the case may be, such consent not to be unreasonably withheld
or delayed, and (iii) within 10 days after the execution of any such assignment
or sublease shall so deliver a conformed copy of such assignment or sublease,
substantially in the form previously consented to by Lessor (with
acknowledgments), and a conformed copy of any short form lease or memorandum of
lease which has been prepared for recording purposes. With regard to proposed
assignments and subleases to a third party other than a Lessee Affiliate, in
determining whether to reasonably consent or withhold such consent thereto,
Lessor shall have the right to approve or disapprove such proposed assignment
(and assignee) and sublease (and sublessee) within 21 days of receipt of notice
thereof pursuant to the preceding sentence, the failure to respond to which
shall be deemed consent. Promptly after receipt thereof, Lessee shall cause
one-half of the excess of the fixed rent payable under any such sublease over
the Fixed Rent, if any, for the same period hereunder to be paid to Lessor's
account by such sublessee, subject to deduction of tenant improvements, legal
fees, commissions and other costs, all reasonably incurred and at arm's length.
(c) It shall be a condition precedent to any assignment of this Lease
which is the result of a merger of Lessee into or with another corporation or
entity, to the merger of another corporation or entity into Lessee, to the
consolidation of Lessee with one or more other corporations or entities, and to
the sale or other disposition of all or substantially all the assets of Lessee
to one or more other corporations or entities that the Lessor shall be given a
written certification from an executive officer of Lessee that (x) upon the
consummation thereof such surviving corporation or entity or transferee of
assets, as the case may be, shall assume (and shall promptly deliver to Lessor
an acknowledged instrument evidencing such assumption and reasonably
satisfactory to Lessor) all obligations, covenants and responsibilities of
Lessee hereunder and under any instrument executed by Xxxxxx relating to the
Premises or this Lease, including, without limitation, any consent to the
assignment of Lessor's interest in this Lease to any mortgagee, (y) no default
under the Lease has occurred with respect to which notice has been given and the
applicable cure period has expired and (z) the surviving entity of any merger or
consolidation or transferee of such assets allowed above will have a net worth
equal to or greater than the net worth of Lessee on the day prior to the merger,
consolidation or disposition.
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As used herein, "net worth" means the excess of total assets over total
liabilities, excluding, however, from the determination of total assets (i)
goodwill; (ii) tradenames; (iii) organizational expenses; and (iv) treasury
stock, as each are determined in accordance with generally accepted accounting
principles.
11. GENERAL INDEMNIFICATION; INSURANCE:
(a) Indemnification. Xxxxxx agrees to indemnify and hold Lessor and
its agents, servants, directors, officers, partners and employees (collectively,
the "Indemnified Parties"), harmless against and from any loss, damage or
liability occasioned by, growing out of, or arising or resulting from Xxxxxx's
use, operation, occupancy, management, maintenance, repair of, and compliance
with association and/or development agreements with respect to, the Premises,
any default by Xxxxxx hereunder, or any negligent act or omission on the part of
Lessee, Lessees' agents, invitees or employees, unless caused by the gross
negligence or willful misconduct of Lessor, or Lessor's agents, employees,
contractors, prospective purchasers or invitees. If any action or proceeding is
brought against Lessor by reason of any of the foregoing matters, Xxxxxx shall
upon notice defend the same at Xxxxxx's expense by counsel reasonably
satisfactory to Lessor and Xxxxxx shall cooperate with Lessee in such defense.
Lessor need not have first paid any such claim in order to be defended or
indemnified. Lessor shall not be liable for injury or damage to the person or
goods, wares, merchandise or other property of Lessee, Lessee's employees,
contractors, invitees, customers, or any other person in or about the Premises,
whether such damage or injury is caused by or results from fire, steam,
electricity, gas, water or rain, or from the breakage, leakage, obstruction or
other defects of pipes, fire sprinklers, wires, appliances, plumbing, HVAC
System or lighting fixtures, or from any other cause, whether the said injury or
damage results from conditions arising upon the Premises or upon any portion
thereof or from other sources or places unless caused by the gross negligence or
willful misconduct of Lessor, or Lessor's agents, employees, contractors,
prospective purchasers or invitees. Notwithstanding Lessor's negligence or
breach of this Lease, Lessor shall under no circumstances be liable for injury
to Xxxxxx's business or for any loss of income or profit therefrom.
(b) Insurance.
(i) Liability. Xxxxxx shall obtain and maintain in force a
Commercial General Liability Policy of Insurance protecting Xxxxxx and
Xxxxxx and any mortgagee against claims for bodily injury, personal
injury and property damage based upon or arising out of the ownership,
use, occupancy or maintenance of the Premises. Such insurance shall be
on an occurrence basis providing single limit coverage in an amount not
less than $2,000,000 per occurrence with an "Additional Insured-Managers
or Lessors of Premises Endorsement" and contain the "Amendment of the
Pollution Exclusion Endorsement" for damage caused by heat, smoke or
fumes from a hostile fire. The Policy shall not contain any
intra-insured exclusions as between insured persons or organizations,
but shall include coverage for liability assumed under this Lease as an
"insured contract" for the performance of Xxxxxx's indemnity obligations
under this Lease. The limits of said insurance shall not, however, limit
the liability of Lessee nor relieve Xxxxxx of any obligation hereunder.
All insurance carried by Lessee shall be primary to and not contributory
with any similar insurance carried by Lessor, whose insurance shall be
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considered excess insurance only. Lessor may maintain similar liability
insurance, in addition to, and not in lieu of, the insurance required to
be maintained by Lessee and Lessee shall not be named as an additional
insured therein.
(ii) Property. Lessee shall obtain and maintain, or cause to be
obtained and maintained, in force an all-risk policy or policies
("Casualty Insurance") in the name of Lessor, with loss payable to
Lessor and any mortgagee insuring loss or damage to the Premises. The
amount of such Casualty Insurance shall be equal to the full replacement
cost of the Premises, as the same shall exist from time to time, or the
amount required by any mortgagee, but in no event more than the
commercially reasonable and available insurable value thereof. If the
coverage is available and commercially appropriate, such policy or
policies shall insure against all risks of direct physical loss or
damage (except the perils of flood and/or earthquake unless required by
law), including coverage for debris removal and the enforcement of any
law requiring the upgrading, demolition, reconstruction or replacement
of any portion of the Building as a result of a covered loss. Said
policy or policies shall also contain an agreed valuation provision in
lieu of any coinsurance clause and waiver of subrogation. If such
Casualty Insurance has a deductible clause, the deductible amount shall
not exceed $5,000 per occurrence, and Lessee shall be liable for such
deductible amount in the event of an insured loss.
(iii) Lessee's Personal Property. Lessee shall obtain and maintain
insurance coverage on all of Xxxxxx's personal property, trade fixtures,
and Xxxxxx owned alterations and utility installations. Such insurance
shall be full replacement cost average with a deductible not to exceed
$5,000 per occurrence. The proceeds from any such insurance shall be
used by Lessee for the replacement of personal property, trade fixtures
and lessee owned alterations and utility installations. Lessee shall
provide Lessor with written evidence that such insurance is in force.
Lessee shall also obtain and maintain a business interruption or rental
loss insurance policy, payable to Lessor as loss payee, in an amount
equal to twelve months of operation of the Premises, the proceeds of
which shall be applied by Lessor against the Rent payable for such
period with any excess thereof paid to Lessee.
(iv) Terms of Policies. Insurance required herein shall be issued
by companies duly licensed or admitted to transact business in the State
of California and maintaining during the policy term a "General
Policyholders Rating" of at least IX:A or better, as set forth in the
most current issue of "Best's Insurance Guide", or such other rating as
may be required by a mortgagee. Lessee shall not do or permit to be done
anything which invalidates the required insurance policies. Lessee
shall, prior to the Commencement Date, deliver to Lessor certified
copies of policies of such insurance or certificates evidencing the
existence and amounts of the required insurance. No such policy shall be
cancelable or subject to modification except after thirty (30) days
prior written notice to Lessor. Lessee shall, at least thirty (30) days
prior to the expiration of such policies, furnish Lessor with evidence
of renewals or "insurance binders" evidencing renewal thereof, or Lessor
may order such insurance and charge the cost thereof to Lessee, which
amount shall be payable by Lessee to Lessor upon demand. Such policies
shall be for a term of at least one year, or the length of the remaining
term of this Lease, whichever is less. If Lessee shall fail to procure
and maintain the insurance required to be carried by
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it, Lessor may, but shall not be required to, procure and maintain
the same, the cost and expense of which shall continue to be payable
upon demand as Additional Rent. The parties agree to have their
respective property damage insurance carriers waive any right to
subrogation that such companies may have against Lessor or Lessee, as
the case may be, in accordance with Section 11(c) below.
(v) Lessee will pay to Lessor, as Additional Rent, all premiums
for Casualty Insurance which are due and payable or which have been paid
by Lessor, promptly upon written demand therefor, but in no event later
than 10 days of such demand, such demand to include a copy of the
Casualty Insurance bill or evidence of Lessor's payment thereof.
(c) Waiver of Subrogation. Lessee and Xxxxxx each hereby waives any
and all rights of recovery against the other, and against the officers,
employees, agents and representatives of the other, for loss of or damage to the
property of the waiving party or the property of others under its control, to
the extent such loss or damage is covered by proceeds received under any
insurance policy carried by Lessor or Lessee and in force at the time of such
loss or damage. Each party agrees to have their respective insurance carriers
waive such insurance carriers' rights to subrogation (including, if necessary,
by the payment of any reasonable increase in premium) provided, however, if the
inclusion of this Section invalidates any such coverage for either party, then
the foregoing waiver shall be of no further force and effect.
12. SUBORDINATION:
Xxxxxx agrees upon request of Lessor to confirm the subordinate nature
of this Lease to the existing mortgage encumbering the Premises and to
subordinate this Lease and its rights hereunder to the lien of any other or
future mortgage, deed of trust or other voluntary hypothecation arising out of
any security instrument duly executed by Lessor charged against the Premises or
any portion or portions thereof and to execute at any time and from time to time
within ten (10) days after a written request is made a subordination,
non-disturbance and attornment agreement substantially in the form of Exhibit E
hereto in order to effectuate such subordination; provided, however, that Lessee
shall not be required to effectuate any such subordination or other document
hypothecating any interest in the Premises unless the mortgagee or beneficiary
named in such mortgage or deed of trust shall agree in writing that so long as
Lessee is not in default of any of the terms, covenants, or condition of this
Lease, neither this Lease nor any of the rights of Lessee hereunder shall be
terminated or modified or be subject to termination or modification by any
trustee's sale, any action or proceeding in foreclosure, or any sale in lieu of
the foregoing and any successor-in-interest to Lessor shall fulfill all of the
obligations of "Lessor" hereunder. In the event of any sale of the Premises by
Xxxxxx, (i) Lessor shall be relieved of all liability hereunder and (ii) if
requested by Lessor or such transferee, Lessee shall attorn to the new lessor in
consideration for customary non-disturbance assurances by such lessor.
13. DAMAGE OR DESTRUCTION:
(a) Total Destruction. In the event that the Premises (other than
Xxxxxx's personal property, fixtures and installations) are destroyed or damaged
by fire, flood, earthquake, tornado or by the elements or otherwise to such an
extent that the Premises cannot be repaired and
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restored within six (6) months of such destruction or damage, either party may
terminate this Lease as of the date of said destruction or damage by giving
written notice thereof to the other within thirty (30) days of said destruction
or damage.
(b) Partial Destruction. If the Premises (other than Lessee's personal
property, fixtures and installations) shall be destroyed or damaged in any way
by fire, flood, earthquake, tornado or by the elements or otherwise which can
reasonably be repaired in six (6) months or less from the date of such damage or
destruction, Lessor shall notify Lessee thereof and shall, at Lessor's own cost
and expense, and in conformance with all applicable laws, ordinances,
development agreements and/or restrictive covenants, promptly repair, rebuild
and restore same into at least as good a condition in which they existed
immediately prior to such destruction or damage and, from the date of such
destruction or damage until such time as the Premises are repaired and restored
as aforesaid, the Fixed Rent and other charges payable hereunder shall be
equitably abated from the date of such destruction or damage in the proportion
and to the extent that the Premises are unusable by Lessee for its purposes as
elsewhere herein stated and this Lease shall continue in full force and effect;
provided, however, that Lessee shall, at Lessor's election, make the repair of
any damage or destruction the total cost to repair of which is $10,000 or less,
and, in such event, Lessor shall make any applicable insurance proceeds
available to Lessee on a reasonable basis for that purpose. Notwithstanding the
foregoing, if the insurance proceeds are not sufficient to effect such repair,
Lessee may, at its cost, promptly contribute the shortage in proceeds as and
when required to complete said repairs within ten (10) days of request therefor.
If Xxxxxx receives said funds or adequate assurance thereof within said ten (10)
day period, Lessor shall complete them as soon as reasonably possible and this
Lease shall remain in full force and effect. If such funds or assurance are not
received, Lessor may elect by written notice to Lessee within ten (10) days
thereafter to: (i) make such restoration and repair as is commercially
reasonable with Lessor paying any shortage in proceeds, in which case this Lease
shall remain in full force and effect, or (ii) have this Lease terminated thirty
(30) days thereafter and Lessee shall not be entitled to reimbursement of any
funds contributed by Lessee to repair any such damage or destruction.
Unreasonable delay on the part of Lessor in commencing repair and restoration
following destruction or damage shall entitle Lessee to terminate this Lease on
a date not less than sixty (60) days from the date of such notice but in no
event shall any delay for ninety (90) days or less from the date of such damage
or destruction be deemed unreasonable. In the event that Lessor shall not
complete any repair or restoration within six (6) months following any
destruction or damage, then Lessee shall have the right to terminate this Lease
upon written notice to Lessor delivered no longer than fifteen (15) days
thereafter. In case the Premises shall be substantially damaged during the last
six (6) months of the terms of this Lease, then Lessor or Lessee may cancel this
Lease upon written notice to the other party given within thirty (30) days after
such damage provided, however, that if such damage or destruction has occurred
during the Primary Term or the initial Renewal Term and Lessee has validly
exercised its Renewal Option for the following Renewal Term, Lessee may preserve
this Lease by providing Lessor, on or before the date which is ten (10) days
after Xxxxxx's receipt of Xxxxxx's written notice purporting to terminate this
Lease, with all insurance proceeds relating to such casualty and other
immediately available funds necessary to fully repair such damage or
destruction. If Lessee duly exercises such option and provides Lessor with such
funds, Lessor shall, at Xxxxxx's cost and expense, payable solely from such
funds, repair such damage as soon as reasonably possible with rent being
equitably abated as stated above and this
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Lease shall continue in full force and effect. If Lessee fails to provide such
funds during such period, then this Lease shall terminate on the date specified
in the termination notice and Xxxxxx's option shall be extinguished. Lessor
shall not be required to make any repairs or replacements of any leasehold
improvements, fixtures, or other personal property of Xxxxxx. Any payments
(including insurance proceeds) received by Lessor or Lessee from any
governmental authority, development association or other party with respect to
damage, loss or casualty, will be applied directly in payment of repairs of such
damage, loss or casualty. Any balance remaining will be retained by Lessor to
the extent not specifically identified by the applicable governmental entity or
development association as compensation to Lessee. Xxxxxx and Xxxxxx agree that
the terms of this Lease shall govern the effect of any damage to or destruction
of the Premises with respect to the termination of this Lease and hereby waive
the provisions of any present or future law to the extent inconsistent herewith.
14. CONDEMNATION:
If more than twenty-five percent (25%) of the Building, or more than
forty percent (40%) of the Land Parcel not occupied by the Building, is taken
under the power of eminent domain or condemnation or sold under the threat of
the exercise of said power (collectively "Condemnation"), Lessee may, at
Lessee's option, to be exercised in writing within ten (10) days after Lessor
shall have given Lessee written notice of such taking (or in the absence of such
notice, within ten (10) days after the condemning authority shall have taken
possession) terminate this Lease as of the date the condemning authority takes
such possession. If Xxxxxx does not terminate this Lease in accordance with the
foregoing, this Lease shall remain in full force and effect as to the portion of
the Premises remaining, except that the Fixed Rent shall be reduced in
proportion to the reduction of the Space caused by such Condemnation.
Condemnation awards and/or payments shall be the property of Lessor, whether
such award shall be made as compensation for diminution in value of the
leasehold, the value of the part taken, or for severance damages; provided,
however, that Lessee shall be entitled to any compensation specifically
identified by the applicable governmental entity as compensation for Xxxxxx's
relocation expenses, loss of business goodwill and/or trade fixtures, without
regard to whether or not this Lease is terminated pursuant to the provisions of
this Section. All alterations and utility installations made to the Premises by
Xxxxxx, for purposes of Condemnation only, shall be considered the property of
the Lessee and Lessee shall be entitled to any and all compensation subject to
the foregoing. In the event that this Lease is not terminated by reason of the
Condemnation, Lessor shall repair any damage to the Premises in accordance with
the terms of this Lease to the extent practical caused by such Condemnation, the
cost and expense of which shall be payable by Lessor solely from Condemnation
awards.
15. ACCESS:
Lessor's agents, employees, contractors and prospective purchasers shall
have the right to enter the Premises at reasonable hours upon advance written
notice to the Lessor and approval from Lessee (except in an emergency), such
approval not to be unreasonably withheld for the purpose of inspecting or
repairing the same and may erect scaffolding and other necessary structures
where reasonably required. Except as provided in Section 13 hereof and Section
14 hereof (with respect to the condemning authority), Lessee hereby waives any
claim for damages to Xxxxxx's business, any loss of occupancy or quiet enjoyment
of the Premises, and any other
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loss occasioned thereby due to Xxxxxx's actions pursuant to this Section other
than as a result of the gross negligence or willful misconduct of Lessor or
Lessor's agents, employees, contractors, prospective purchasers or invitees.
Lessor shall retain a key to the Premises, excluding Xxxxxx's vaults, safes and
files, and Lessor shall have the right to use any and all means which Lessor may
deem proper to open said doors in an emergency, without any liability to Lessee.
Any entry to the Premises by Lessor shall not be construed to be a forcible or
unlawful entry into the Premises, or an eviction of Lessee from the Premises.
16. DEFAULT BY LESSEE:
Any of the following occurrences or acts shall constitute an Event of
Default under this Lease and Lessee shall promptly notify Lessor of the
occurrence thereof:
(a) Lessee shall default (i) in the payment of any Fixed Rent and such
default shall continue for five (5) days after Lessor shall have given written
notice (using a nationally recognized overnight delivery courier) to Lessee
specifying such default; or (ii) in the payment of any Additional Rent or other
sum specifically to be paid by Lessee hereunder and such default shall not have
been cured within ten (10) days after Lessor shall have given written notice
(using a nationally recognized overnight delivery courier) to Lessee specifying
such default; or
(b) Lessee shall default in the observance or performance of Sections
10, 11(b) or 19 hereof; or
(c) Lessee shall default in the observance or performance of any of
Xxxxxx's other covenants hereunder (other than the covenants described in
Sections 16(a) and (b) above), under any other instrument, the Lessor
Improvement Letter, the Lessee Clean Room Letter or such other agreements
entered into by Lessor and Lessee is connection with the execution and delivery
hereof or observance of the Rules and Regulations described in Exhibit C hereto
governing the Premises and such default shall not have been cured within thirty
(30) days after Lessor shall have given to Lessee written notice specifying such
default, provided, however, that if the default complained of shall be of such a
nature than the same cannot be completely remedied or cured within such
thirty-day period and if Lessee shall have commenced curing such default within
such thirty-day period and shall proceed with reasonable diligence and in good
faith to remedy the default complained of then such default shall not constitute
an Event of Default for the purposes of this period, but in any event such
default shall constitute an Event of Default hereunder after ninety (90) days
from the date of such default if not so cured; or
(d) Lessee shall file a petition in bankruptcy or for reorganization
or for an arrangement pursuant to Title 11 of the United Stated Code, the
Bankruptcy Code of 1978, as amended (the "Bankruptcy Act"), or shall be
adjudicated a bankrupt or become insolvent or shall make an assignment for the
benefit of its creditors, or shall admit in writing its inability to pay its
debts generally as they become due, or shall be dissolved, or shall take any
corporate action in furtherance of any of the foregoing; or
(e) if a petition or answer shall be filed proposing the adjudication
of Lessee as a bankrupt or its reorganization pursuant to the Bankruptcy Act and
(i) Lessee shall consent to the
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filing thereof, or (ii) such petition or answer shall not be discharged or
denied within 60 days after the filing thereof; or
(f) if a receiver, trustee or liquidator (or other similar official)
shall be appointed for or take possession or charge of Lessee or its successor
and shall not be discharged within 60 days thereafter, or if Lessee shall
consent to or acquiesce in such appointment;
then, upon the happening of any one or more of such Events of Default, Lessor
may, without further demand for rent due or for the observance or performance of
any of said terms, conditions or agreements, terminate this Lease and/or
re-enter said Premises and remove all persons and property therefrom, using such
force as may be necessary in compliance with any applicable process of law, and
repossess said Premises as its own either by summary proceedings or by any
suitable action or proceeding at law, or otherwise, without being liable to
indictment, prosecution or damages therefor, and may have, hold and enjoy the
Premises, together with the appurtenances thereto and the improvements thereon;
and/or terminate this Lease at any time by giving notice in writing to Lessee,
electing to terminate this Lease and specifying the date of termination, and the
Term of this Lease shall expire by limitation at midnight on the date specified
in such notice as fully and completely as if said date were the date herein
originally fixed for the expiration of the Term hereby granted and Xxxxxx shall
thereupon quit and peacefully surrender and return the Premises to Lessor,
without any payment therefor by Xxxxxx, and upon the date following the date
specified in such notice, or at any time thereafter, Lessor may re-enter and
repossess the Premises as provided above and Lessor shall have such other rights
and remedies as may be allowed at law or in equity. In the event the Lease is
terminated, Lessor shall be entitled to recover from Lessee: (i) the unpaid Rent
which had been earned at the time of termination; (ii) 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
the Lessee proves could have been reasonably avoided; (iii) 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 the Lessee
proves could be reasonably avoided; and (iv) any other amount necessary to
compensate Lessor for all the detriment proximately caused by the Lessee's
failure to perform its obligations under this Lease or which in the ordinary
course of things would be likely to result therefrom, including but not limited
to the cost of recovering possession of the Premises, unamortized brokerage
commissions and Allowance (as defined in the Lessor Improvement Letter),
applicable to the unexpired term of this Lease, expenses of re-letting,
including necessary renovation and alteration of the Premises and reasonable
attorneys' fees. The worth at the time of award of the amount referred to in
provision (iii) of the immediately preceding sentence shall be computed by
discounting such amount at the discount rate of the Federal Reserve Bank of the
district within which the Premises are located at the time of award plus one
percent (1%). Efforts by Lessor to mitigate damages caused by Xxxxxx's breach of
this Lease shall not waive Lessor's right to recover damages under this Section.
The words "re-enter" and "repossess", as used in this Lease, are not and shall
not be restricted to their technical legal meanings, but are used in the
broadest sense. No such taking of possession of the Premises by Lessor shall
constitute an election to terminate the Term of this Lease unless notice of such
intention be given to Lessee or unless such termination be decreed by a court
having jurisdiction. If an action shall be brought for the enforcement of any
provision of this Lease, in which it is found that an Event of Default has
occurred, Lessee shall pay to Lessor all costs and other expenses which may
become payable as a result thereof, including reasonable
-16-
attorneys' fees and expenses. No right or remedy herein conferred upon or
reserved to Lessor is intended to be exclusive of any other right or remedy,
and every right and remedy shall be cumulative and in addition to any other
legal or equitable right or remedy given hereunder, or at any time existing.
Receipt by Lessor of any Fixed Rent or Additional Rent or any other sum payable
hereunder with knowledge of the breach of any provision contained in this Lease
shall not constitute a waiver of such breach, and no waiver by Lessor of any
provision of this Lease shall be deemed to (i) have been made unless made under
signature of an authorized representative of Lessor or (ii) constitute a waiver
of any other breach or default hereunder.
17. DEFAULT BY XXXXXX:
Lessor shall make all payments and do such other things as may be
required of it hereunder and if Lessor at any time during the term of this Lease
shall fail to make any such payments or shall fail to perform any covenants or
agreement in this Lease contained on the part of Lessor to be performed, then
and in any such event or events Lessee may, after the continuance of any such
failure or default for thirty (30) days after notice in writing thereof is given
by Lessee to Lessor, make such payments and do such work and otherwise perform
Xxxxxx's covenants all on behalf of and at the reasonable expense of Xxxxxx.
Xxxxxx agrees to pay to Xxxxxx forthwith the amount of the payment so made or
the reasonable cost and expense incurred. In no event shall Lessee be relieved
of any of its obligations to pay Rent under this Lease as a result of Xxxxxx's
failure to perform any of its obligations hereunder.
18. HOLDING OVER:
Lessee has no right to retain possession of the Premises or any portion
thereof beyond the expiration or termination of this Lease. In the event Lessee
remains in possession of the Premises after the expiration or termination of the
Primary Term of this Lease or any renewal thereof, it shall (i) be deemed to be
a tenant from month to month only; (ii) pay a monthly rental rate equal to one
and one-half of the then current rate in effect during the last month of the
term just expired; and (iii) be governed in all other things, except as to the
duration of the term, by the provisions of this Lease. In such event either
party may terminate such tenancy by giving to the other at least thirty (30)
days prior written notice of its intent to terminate.
19. SURRENDER:
At the expiration or termination of the term of this Lease or any
extension thereof, Xxxxxx agrees, subject to Section 7 hereof, to quit and
surrender possession of the Premises to Lessor in as good condition as when
delivered by Xxxxxx, excepting as provided in Paragraphs 6(b), 13 and 14 hereof.
20. NOTICES:
All notices, requests, demands or other communications with respect to
this Lease, except as set forth in Section 16(a) hereof, whether or not herein
expressly provided for, shall be in writing and shall be deemed to have been
duly given when mailed by United States, certified or registered mail, postage
prepaid, return receipt requested, or by nationally recognized overnight
delivery courier to the parties at their respective addresses as first above
written. Any such
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addresses for the giving of notice may be changed by either party by giving
notice thereof in writing to the other. Any notice sent by registered or
certified mail, return receipt requested, shall be deemed given on the date of
delivery shown on the receipt card, or if no delivery date is shown, the
postmark thereon. Notices delivered by overnight courier that guarantee next day
delivery shall be deemed given twenty-four (24) hours after delivery of the same
to the courier. If notice is received on a Saturday, Sunday or legal holiday, it
shall be deemed received on the next business day.
21. FINANCIAL INFORMATION
Lessee will deliver to Lessor the following: (i) within 60 days after
the end of each quarterly fiscal period (except the last) in each fiscal year of
Lessee, a copy of a consolidated balance sheet of Lessee as at the end of such
quarter, a consolidated statement of profits and losses portion of the fiscal
year ending with such quarter, and a consolidated statement of cash flows of
Lessee for the portion of the fiscal year ending with the current quarter, all
in reasonable detail and prepared in accordance with generally accepted
accounting principles and certified as complete and correct by an executive
officer of Lessee; and (ii) within 120 days after the end of each fiscal year of
Lessee, duplicate copies of a consolidated balance sheet of Lessee as at the end
of such year, a consolidated statement of profits and losses and cash flows of
Lessee for such year, and a consolidated statement of cash flows of Lessee for
such year, all in reasonable detail and containing an opinion, unqualified as to
limitations imposed by Lessee on the scope of the audit, of a firm of
independent certified public accountants of recognized standing selected by
Xxxxxx that such financial statements fairly present the financial condition of
the companies (including the results of their operations and changes in
financial position being reported upon, have been prepared in accordance with
generally accepted accounting principles). Except as required by applicable law
or unless already in the public domain, Xxxxxx agrees to keep such financial
statements confidential and not to deliver such financial statements to its
mortgagee or any other third-party unless such recipient agrees to be similarly
bound.
22. QUIET ENJOYMENT:
Lessor covenants and agrees that so long as Xxxxxx shall not be in
default hereunder, Xxxxxx shall at all times during the term of this Lease and
any extension and renewal hereof, not interfere with Xxxxxx's peaceable use and
quiet enjoyment of the Premises subject to the terms hereof.
23. RIGHT TO EXTEND:
So long as no default or Event of Default shall have occurred and be
continuing on the Renewal Option Notice Date, as defined below, or on the last
day of the Primary Term or, with respect to the second Renewal Term, on the last
day of the initial Renewal Term, Lessee shall have the option to extend and
renew the Term of this Lease with respect to all but not less than all of the
Premises for a Renewal Term (each, a "Renewal Option"). Lessee shall make such
election by irrevocable written notice to Lessor on or before six (6) months
prior to the expiration of the Primary Term or the initial Renewal Term, as the
case may be (each, a "Renewal Option Notice Date"). Either party, upon the
request of other, shall execute and acknowledge, in form suitable for recording,
an instrument confirming any such renewal. Time
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is of the essence with respect to the giving of notice by Xxxxxx of its election
to extend the Term of this Lease for a Renewal Term. The leasing of the
Premises during any Renewal Term shall be made upon the same terms and
conditions as set forth herein except that the Fixed Rent shall be adjusted to
100% of a Fair Market Rental, as defined below, existing on the Renewal Option
Notice Date and thereafter be subject to Section 3(b) hereof. The second Renewal
Option shall be terminated without further action in the event Lessee shall not
have duly exercised the first Renewal Option and extended the term of this Lease
for the initial Renewal Term or in the event an Event of Default has occurred
and is continuing on the last day of the Initial Renewal Term. "Fair Market
Rental" means such annual rental rate as established by Lessor and Lessee within
60 days after the Renewal Option Notice Date provided, however, if Lessor and
Lessee cannot reach agreement on such rate by such date, then:
(a) Lessor and Lessee shall immediately appoint a mutually acceptable
real estate appraiser or broker to establish the new Fair Market Rental within
the next 30 days. Any associated costs will be split equally between Lessor and
Lessee, or
(b) Both Lessor and Lessee shall each immediately make a reasonable
determination of the Fair Market Rental and submit such determination, in
writing, to arbitration in accordance with the following provisions:
(i) Within 15 days thereafter, Lessor and Lessee shall each select
a real estate broker of their choice to act as an arbitrator. The two
arbitrators so appointed shall immediately select a third mutually
acceptable arbitrator to act as a third arbitrator.
(ii) The three arbitrators shall within 30 days of the appointment
of the third arbitrator reach a decision as to what the actual Fair
Market Rental for the Premises is, and whether Lessor's or Xxxxxx's
submitted Fair Market Rental is the closest thereto. The decision of a
majority of the arbitrators shall be binding on Lessor and Xxxxxx. The
submitted Fair Market Rental which is determined to be the closest to
the actual Fair Market Rental shall thereafter be used by Lessor and
Lessee.
(iii) If either of Lessor or Xxxxxx fails to appoint an arbitrator
within the specified 15 days, the arbitrator timely appointed by one of
them shall reach a decision on his or her own, and said decision shall
be binding on Lessor and Xxxxxx.
The entire cost of such arbitration shall be paid by the party whose
submitted Fair Market Rental is not selected, i.e. the one that is NOT the
closest to the actual Fair Market Rental.
24. TAXES:
(a) Payment of Taxes. Lessee will pay to Lessor, as Additional Rent,
all real estate taxes and assessments on the Premises (the "Real Estate Taxes")
applicable to the Term of this Lease which are due and payable or which have
been paid by Lessor, promptly upon written demand therefor, but in no event
later than 10 days following such demand or earlier than 30 days prior to the
date such taxes are due and payable, such demand to include a copy of the tax
bill or evidence of Lessor's payment thereof. Lessee shall also pay all taxes
levied against personal property, trade fixtures, and inventory placed by Xxxxxx
in, on or about the Premises. In
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the event any Federal, state, or local governmental authority shall impose or
assess any tax, levy, or other charges against all or any part of the rentals
paid or to be paid by Xxxxxx under the terms of this Lease, Lessee covenants and
agrees to pay or reimburse Lessor for all such charges as may be imposed or
assessed. If Lessee shall fail to pay any required Real Estate Taxes, Lessor
shall have the right to pay the same, and Xxxxxx shall reimburse Lessor therefor
upon demand, but in no event later than 10 days of such demand, together with
interest as set forth in Section 3(d) hereof. Notwithstanding the foregoing,
Lessee shall not be responsible for any additional increase in real estate taxes
and assessments under "Proposition 13" or similar legislation due to a sale,
transfer or other change in ownership in the Building during the Term hereof.
(b) Assessed Value. Lessor shall notify the Lessee of the assessed
value of the Premises at the inception of the Lease and any increase or proposed
increase in real estate tax assessment of which Lessor has knowledge. Lessee
shall have the right to contest by appropriate administrative or legal
proceedings the amount and validity of any tax assessment or charge which Lessee
is required to pay under the terms of this Section so long as such taxes are
paid prior to their due dates and no penalties or additional assessments are
incurred as a result thereof and Lessor is indemnified by Lessee for any costs,
damages, penalties or claims which may be made against Lessor as a result
thereof. Lessor shall, at the request and expense of Xxxxxx, join or otherwise
assist Lessee in any such proceeding. To the extent paid or payable by Xxxxxx
for the period in question, Lessee shall be entitled to any refund or
reimbursement of taxes actually received as a result of such contest.
25. BROKERAGE:
(a) Lessee represents and warrants that it has dealt with no broker in
connection with this transaction other than Xxxxxxx Realty ("Xxxxxxx") and,
except for the payment of the fees of Xxxxxxx and its affiliates in accordance
with the next paragraph, agrees to defend, indemnify and save Lessor harmless
from and against any and all claims for a commission or other fees arising out
of this Lease made by reason of Xxxxxx's engagement of a broker.
(b) Lessor represents and warrants that it has dealt with no broker in
connection with this transaction other than Xxxxxxx Xxxx Company, Inc. ("Xxxx")
and agrees to defend, indemnify and save Xxxxxx harmless from and against any
and all claims for a commission or other fees arising out of this Lease by
reason of Xxxxxx's engagement of a broker. Pursuant to a separate agreement
between Lessor and Xxxx, Lessor shall be responsible for the payment of all fees
of Xxxx and its affiliates, in connection with the execution and delivery hereof
from which the fees of Xxxxxxx and its affiliates, are to be paid pursuant to a
separate agreement between Xxxx and Xxxxxxx. Lessor's liability under the prior
sentence shall be limited solely to its obligation to pay Xxxx and shall have no
obligation to pay any fees or commission to Xxxxxxx.
26. LIMITATION OF LIABILITY:
None of the partners of Lessor, either general or limited, officers,
employees, agents or affiliates of Lessor shall be personally liable for the
observance or performance of the Lessor's obligations hereunder and Xxxxxx
hereby agrees that it shall look solely to Xxxxxx's interest in the Premises and
no other assets or interests for satisfaction of any and all claims which it may
have by reason of any default by Lessor hereunder.
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27. SECURITY DEPOSIT:
Simultaneously with its execution and delivery hereof, Lessee has
deposited with Lessor an amount in cash or an irrevocable standby letter of
credit (to the extent permitted below) equal to $1,250,000 (the "Security
Deposit"). So long as no default or Event of Default has occurred and is
continuing hereunder, such Security Deposit shall be reduced to (i) $850,000 on
the first anniversary of the Commencement Date, (ii) shall be further reduced to
$450,000 on the second anniversary of the Commencement Date; and (iii) $80,000
on the third anniversary of the Commencement Date, such amount in this clause
(iii) to be in the form of cash only. During the term hereof, in no event shall
the Security Deposit be less than $80,000. If the Security Deposit is made in
the form of cash, the Security Deposit shall not be commingled with the Lessor's
own funds and shall be held by Lessor in a separate interest bearing commercial
bank account until the third anniversary of the Commencement Date and,
thereafter, shall be held by Lessor, may be commingled with its funds and no
interest shall be payable thereon to Lessee. Any interest paid or received by
Lessor on the cash so held pursuant to the preceding sentence, if any, shall be
paid to Lessee on or about the date such Security Deposit is reduced in
accordance with this Section. Lessee, in order to satisfy the Security Deposit
requirement in this Section, may either (x) deposit cash with the Lessor; or (y)
if prior to the third anniversary of the Commencement Date, provide to Lessor an
irrevocable standby letter of credit (i) issued by a commercial bank having a
long-term unsecured debt rating of A, or better, by Standard & Poor's or A2, or
better, by Xxxxx'x Investor Services, (ii) shall be in form and substance
reasonably satisfactory to Lessor and, in the case of any renewals thereof,
substantially in the form of the letter of credit which it renews, (iii) name
the Lessor as beneficiary thereof, (iv) provide that the beneficiary thereof may
present and draw upon such letter of credit for Events of Defaults under this
Lease, and (v) allow for multiple draws in amounts approximating the losses,
costs, damages, fees and expenses incurred on reasonably foreseeable by Landlord
at the time of such draw to be incurred which Xxxxxx hereby expressly agrees and
acknowledges are approximations and not intended to be measures of Lessor's
actual or liquidated damages as a result of any such Event of Default. Said
Security Deposit shall be held by Xxxxxx as security for the faithful
performance by Xxxxxx of all the terms of this Lease. If Lessee defaults with
respect to any provisions of this Lease including, but not limited to, the
provisions relating to the payment of Rent, and all applicable notice and cure
periods have expired, Lessor may apply any part of the Security Deposit to the
payment of any sum in default, or for the payment of any amount which Lessor may
spend by reason of Xxxxxx's default, or to compensate Lessor for any other loss
or damage which Lessor may suffer by reason of Lessee's default. If any portion
of the Security Deposit is so applied, Lessee shall, within ten (10) days of
written notice of such application, deposit cash or additional letters of credit
(to the extent permitted herein) with Lessor to restore the Security Deposit to
such level as is then required hereunder. No part of the Security Deposit shall
be considered to be held in trust or to be prepayment for any monies to be paid
by Lessee under this Lease. If Xxxxxx shall fully and faithfully perform every
provision of this Lease to be performed by it, the Security Deposit or any
balance thereof shall be returned to Lessee (or, at Lessor's option, to the last
assignee of Xxxxxx's interest hereunder) within thirty (30) days following
expiration of the Term and surrender of the Premises by Xxxxxx. In the event the
Premises are sold, Lessor shall transfer the Security Deposit and/or the letter
of credit to the purchaser and Lessor shall be relieved of any further liability
to Lessee regarding the Security Deposit from and after the date of transfer.
Any
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transfer fees charged by the issuing bank for the transfer of its letter of
credit shall be paid by Xxxxxx and Lessor equally.
28. ENVIRONMENTAL MATTERS:
(a) Lessor Indemnity. Except as disclosed in writing to Lessee, Lessor
represents that, for all periods prior to the execution and delivery hereof, the
Premises has been and, on the date of delivery hereof, is in compliance with all
federal, state and local environmental laws applicable to the Premises
(collectively, "Environmental Laws"). Lessor agrees to indemnify and hold
Lessee, its shareholders, officers, employees and affiliates harmless from and
against any loss, damage and liability (including, without limitation, damages,
judgments, penalties, claims, charges, costs and expenses (including, without
limitation, reasonable fees and disbursements of counsel and consultants for
Lessee)), which may be suffered or incurred by, or asserted against any such
indemnified party (whether based on strict liability or otherwise) to the extent
arising directly or indirectly out of any conditions existing prior to the
execution and delivery hereof, whether known or unknown, within or about the
Premises relating to any failure to keep the Premises in compliance with
Environmental Laws during such periods, including (without limitation): (i) the
presence, use, storage, transportation, disposal, release, threatened release,
discharge, emission, generation or management of any hazardous substance, as
defined under the Environmental Laws (collectively, "Hazardous Substances") at
the Premises; (ii) the existence of or a threat of a release of a Hazardous
Substance at the Premises; (iii) any matter otherwise regulated by an
Environmental Law at the Premises; or (iv) any violation of this Section 28 by
Lessor, provided, that no such indemnified party will be indemnified by Lessor
hereunder for environmental contamination to the extent caused by the negligence
or willful misconduct of any such indemnified party, their affiliates, agents,
invitees, assignees or sublessees. In the event of the termination or expiration
of this Lease as herein provided or Xxxxxx's abandonment of the Premises, the
obligations and liabilities of Lessor with respect to such indemnified parties,
actual or contingent, under this Section 28 shall survive such expiration,
termination or abandonment.
(b) Lessee Covenants and Indemnity. Lessee covenants that at all times
during the term of the Lease, the Premises and, with respect to the use,
occupancy and operation of the Premises, Lessee, shall comply in all respects
with Environmental Laws. Lessor agrees that Lessee shall have the right to use,
store, transport, release, discharge, generate, dispose or manage Hazardous
Substances in, on or about Premises in quantities necessary for Lessee to
perform its intended business purposes, so long as Lessee complies with all
Environmental Laws respecting the use, storage, transportation, release,
discharge, generation, disposal or management of such Hazardous Materials.
Promptly upon obtaining knowledge thereof, Lessee shall give to Lessor notice of
the occurrence of any of the following events: (i) the failure of the Premises
or Lessee to comply with any Environmental Law in any manner whatsoever; (ii)
the issuance by any governmental authority to Lessee of any notice, complaint or
order of violation or non-compliance of any nature with regard to the Premises
or the use thereof with respect to Environmental Laws; (iii) any notice of a
pending or threatened, non-routine investigation to determine whether Xxxxxx's
(or any sublessee's or assignee's) operations on the Premises are in violation
of any Environmental Law; (iv) the existence or threat of a release of a
Hazardous Substance at the Premises or any condition regulated by any
Environmental Law which is or must be reported to a governmental agency or that
could have a material adverse effect upon the
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Premises; or (v) any other occurrence or discovery or any condition at the
Premises related to Environmental Laws and which would constitute a material
adverse effect on the Premises.
Lessee agrees to indemnify and hold harmless the Indemnified Parties
from and against any and all losses, liabilities (including, without limitation,
damages, judgments, penalties, claims, charges, reasonable costs and expenses
(including, without limitation, reasonable fees and disbursements of counsel and
consultants for any such Indemnified Party)), which may be suffered or incurred
by, or asserted against any such Indemnified Party (whether based on strict
liability or otherwise) to the extent arising directly or indirectly out of: (i)
the presence, use, storage, transportation, disposal, release, threatened
release, discharge, emission, generation or management of any Hazardous
Substances at the Premises; (ii) the existence of or a threat of a release of a
Hazardous Substance at the Premises which does not comply with Environmental
Laws; (iii) any matter otherwise regulated by an Environmental Law at the
Premises; or (iv) any violation of this Section 28 by Lessee, provided, that no
such Indemnified Party will be indemnified by Lessee hereunder for environmental
contamination (x) to the extent caused by the negligence or willful misconduct
of such Indemnified Party or (y) to the extent such contamination occurred or
existed prior to the Commencement Date hereof. Lessee's obligation to remediate
or clean-up Hazardous Substances at the Premises shall be limited to those
Hazardous Substances used, held, released, stored, transported, disposed,
discharged, emitted, generated or managed by Lessee. In the event of the
expiration or termination of this Lease as herein provided or Xxxxxx's
abandonment of the Premises, the obligations and liabilities of Lessee with
respect to such indemnified parties, actual or contingent under this Section 28
shall survive such expiration, termination or abandonment.
29. RECORDING:
If this Lease, in order to be valid and binding against any and all
third parties, is required to be recorded or registered, Lessor shall effect
same without charge to Lessee. It is understood and agreed that if such
recording or registration is desired by the parties hereto, both parties hereto
agree a memorandum or short form of this Lease shall be recorded by the
jurisdiction where the Premises lie.
30. XXXXXX'S RIGHT TO CURE:
If Lessee shall at any time default in the performance of any obligation
under this Lease, Lessor shall have the right, but shall not be obligated, to
enter upon the Premises and to perform such obligation, notwithstanding the fact
that no specific provision for such substituted performance by Xxxxxx is made in
this Lease with respect to such default. In performing such obligation, Lessor
may make any reasonable payment of money or perform any other act. All sums so
paid by Xxxxxx (together with interest at the rate of 4% per annum in excess of
the then prime rate of interest as listed in the Wall Street Journal) and all
necessary incidental costs and expenses in connection with the performance of
any such act by Lessor shall be deemed to be Additional Rent under this Lease
and shall be payable to Lessor immediately on demand. Lessor shall notify Lessee
of the exercise of its rights under this Section following such exercise. Lessor
may exercise the foregoing rights without waiving any other of its rights or
releasing Lessee from any of its obligations under this Lease.
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31. ESTOPPEL CERTIFICATES:
Lessee agrees from time to time promptly upon request but in no event
later than ten (10) business days following request by Lessor, to execute,
acknowledge and deliver to Lessor a statement in writing in the form attached
hereto as Exhibit D certifying that (i) this Lease is unmodified and in full
force and effect; that Lessee has no defense, offsets or counterclaims against
its obligations (a) to pay the Fixed Rent, (b) Additional Rent, and (c) to
perform its other covenants under this Lease except for those items enumerated
in the estoppel certificate; and that there are no uncured defaults of Lessee
under this Lease and, to the best of Lessee's knowledge, that there are no
uncured defaults of Lessor under this Lease (or, if (x) there have been any
modifications, (y) that there are any defenses, offsets, counterclaims, or (z)
defaults, setting them forth in reasonable detail); and (ii) the dates to which
the Fixed Rent, Additional Rent and other charges have been paid. Any such
statement delivered pursuant to this Section 31 may be relied upon by any
prospective purchaser or mortgagee of the Premises or any prospective assignee
of any such mortgagee. If Lessee shall fail to execute or deliver the Estoppel
Certificate within such ten (10) day period, Lessor may execute an Estoppel
Certificate on Xxxxxx's behalf as its attorney-in-fact, with which Lessee hereby
empowers Lessor, coupled with an interest, stating the foregoing.
32. INTENTIONALLY OMITTED.
33. RIGHT OF FIRST OFFER:
During the Term hereof, before Lessor may offer to sell the Premises to
any third party, Xxxxxx agrees to first offer the Premises to Lessee on a
one-time basis by giving written notice (the "Lessor's Offer") of the terms and
conditions on which the Lessor is willing to sell the Premises. Lessee will have
twenty (20) days after the date of receipt of the Lessor's Offer (the "Offer
Notice Period") within which to notify Lessor that Lessee accepts the Lessor's
Offer on the terms and conditions therein contained or to otherwise reach a
mutually satisfactory set of terms and conditions under which Lessee shall
purchase, and the Lessor shall sell the Premises. If Xxxxxx accepts the Lessor's
Offer or reaches an acceptable agreement with Lessor during the Offer Notice
Period, the closing of such sale to Lessee shall take place as set forth in the
Lessor's Offer or as otherwise agreed to by Lessor and Xxxxxx. If Xxxxxx does
not accept the Lessor's Offer in writing or otherwise come to a mutually
satisfactory agreement to purchase the Premises within the Offer Notice Period,
Lessor may sell the Premises to any other person at any time or price and on the
terms and conditions as determined by Lessor without any further duty or
obligation to Lessee. As partial consideration for such one-time right of first
offer, Lessee hereby waives any claim of bad faith or unreasonableness against
Lessor in the event the parties cannot mutually agree on the terms of a sale of
the Premises. Upon the satisfaction of all the terms and conditions contained in
the Lessor's Offer and/or any other agreements of Lessor and Xxxxxx regarding
the sale of the Premises and Xxxxxx's acquisition of the Premises, together with
the payment and satisfaction of all Lessee's obligations hereunder, this Lease
shall terminate and no longer be of any force and effect. The parties hereto
agree to execute any other certificates, documents or instruments and to record
the same, if necessary, to evidence such termination.
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34. MISCELLANEOUS:
(a) Each and all of the terms and agreements herein contained shall be
binding upon and inure to the benefit of the parties hereto and their successors
and permitted assigns. This instrument (together with each letter executed and
delivered on the date hereof by the parties hereto) contains the entire
agreement made between the parties and this Lease and such letters may not be
modified orally or in any manner other than by an agreement in writing signed by
all the parties hereto or thereto, as the case may be, or their respective
successors in interest.
(b) The headings to the section of this Lease are inserted for
convenience and shall have no effect upon the construction or interpretation of
any part hereof.
(c) Time is of the essence with respect to the obligations of this
Lease.
(d) Lessee shall comply with the rules and regulations attached hereto
as Exhibit C and such other reasonable rules and regulations that Lessor may
establish from time to time for the general benefit of Lessor and the Premises,
provided Lessee is given a copy of such rules and regulations prior to any
application or enforcement thereof.
(e) If Lessee is a corporation, each individual executing this Lease on
behalf of said corporation represents and warrants that he is duly authorized to
execute and deliver this Lease on behalf of said corporation, in accordance with
the by laws of said corporation, and that this Lease is binding upon and
enforceable against said corporation.
(f) This Lease shall be governed by the laws of the State of
California.
(g) This Lease, as amended, and any letter agreements entered into
between Lessor and Lessee in connection with execution and delivery of this
Lease contain all of the agreements of the parties hereto with respect to any
matter covered or mentioned in this Lease, and no prior agreements or
understanding pertaining to any such matters shall be effective for any purpose.
(h) Any provision of this Lease which shall prove to be invalid, void,
or illegal shall in no way effect, impair or invalidate any other provision
hereof and such other provision shall remain in full force and effect.
(i) This Lease may be executed in any number of counterparts, each of
which shall be deemed to be an original but all of which shall constitute one
and the same instrument.
(j) Lessee hereby represents and warrants to Lessor that:
(i) Lessee (a) is a duly organized and validly existing
corporation in good standing under the laws of the State of California;
and
(ii) this Lease and any letter agreements entered into between
Lessor and Lessee in connection with execution and delivery of this
Lease have been duly authorized, executed and delivered by Xxxxxx and,
upon execution and delivery by Xxxxxx, this Lease and such letter
agreements will constitute the legal, valid and binding obligation of
Lessee enforceable in accordance with their respective terms except as
such terms may be limited by bankruptcy, insolvency, moratorium or other
similar laws
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affecting the rights of creditors generally and except to the extent
that equitable remedies such as specific performance may be in the
discretion of the courts.
[Remainder of Page Blank/Signatures to Follow]
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IN WITNESS WHEREOF, the parties hereto have duly executed this Lease as
of the day and year first above written.
LESSOR:
CORPORATE REALTY INCOME FUND I, L.P.
By:
---------------------------------------------
Xxxxxx X. Xxxxxxx
General Partner
LESSEE:
LIGHTCROSS, INC.
By:
---------------------------------------------
Name:
Title:
Exhibit A - 1
[Description of the Rentable Space/Premises]
Exhibit A-2
[Description of Land Parcel]
Exhibit B
Corporate Realty Income Fund I, L.P.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
_______________, 2001
LightCross, Inc.
0000 Xxxxxxxxx Xxxxx
Xxxxxxxx Xxxx, XX
Attention: Xxx X. Xxxxx
Re: Lease Rent Commencement Date Letter
Dear Xx. Xxxxx:
Reference is hereby made to the Lease Agreement, dated as of November
17, 2000 (as amended and modified from time to time, the "Lease"), between
Corporate Realty Income Fund I, L.P., a Delaware limited partnership, as Lessor
(together with its successors and assigns, "Lessor"), and LightCross, Inc., a
California corporation, as lessee (together with its successors and assigns,
"Lessee"). All capitalized terms used but not otherwise defined herein shall
have the meaning set forth in the Lease.
This Letter shall confirm the Rent Commencement Date of the Lease
as: __________, 2001.
The Expiration Date of the Primary Term is _________, 2011.
Sincerely,
CORPORATE REALTY INCOME FUND I, L.P.
By:
---------------------------------
Xxxxxx X. Xxxxxxx, Xx.
General Partner
Accepted and Agreed to
By: LIGHTCROSS, INC.
By:
--------------------------------------
Name:
Title:
Date: , 2001
-------------------
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Exhibit C
Rules and Regulations
1. Except as set forth in Section 8 of the Lease, no sign, picture, name,
notice or other object shall be displayed or affixed on any part of the
Premises which is visible from outside the Premises without the prior
consent of the Lessor.
2. Lessee, at its sole cost and expense, may provide such security
including, without limitation, equipment, personnel, procedures and
systems, for the Premises as determined by Lessee, in Xxxxxx's sole
determination.
3. Lessee shall be solely responsible for all janitorial service to the
Premises including, without limitation, the cost, expense and selection
thereof.
4. Lessee shall not overload the floor of the Premises or in any way
deface the Premises.
5. Lessee shall not use or keep any noxious gas or liquid or combustible
fluid or material or similar substance in the Premises, except in
compliance with applicable environmental laws, or permit the Premises
to be used in a manner unreasonably offensive to Lessor by reason of
noise, odors or vibrations.
* * *
ACKNOWLEDGED: LESSEE:
LIGHTCROSS, INC.
By:
-----------------------------------
Name:
Title:
Exhibit D
[Form of Estoppel Certificate]
--------------------,
Re: 0000 Xxxxxxxxx Xxxxx
Xxxxxxxx Xxxx, XX
Lease between Corporate Realty Income Fund I, L.P. and
LightCross, Inc. dated as of November 17, 2000 (the "Lease")
Lessee hereby certifies as follows:
1. The Lease is unmodified and in force and effect except as enumerated
below [insert if applicable].
2. Lessee has no defenses, offsets or counterclaims against its
obligations (a) to pay the Fixed Rent, (b) Additional Rent, and (c) to
perform its other covenants under the Lease except as enumerated below
[insert if applicable]
3. To the best of Xxxxxx's knowledge only with respect to Lessor, there
are no uncured defaults of Lessor or Lessee under the Lease except as
enumerated below [insert if applicable].
4. The last date to which Fixed Rent, Additional Rent and other charges
due under the Lease have been paid is ____________.
All capitalized terms used herein but not defined herein shall have the meanings
assigned to them in the Lease. Xxxxxx acknowledges that this certificate may be
relied upon by any actual or prospective mortgagee (or assignee thereof) or
purchaser of the Premises.
IN WITNESS WHEREOF, Xxxxxx has caused this instrument to be executed
this ___ day of _____________.
LESSEE:
LIGHTCROSS, INC.
By:
------------------------------------
Name:
Title:
Exhibit E
[Form of Subordination, Non-Disturbance and Attornment Agreement]
