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EXHIBIT 10.13
LEASE
DATED APRIL 1, 1999
BY AND BETWEEN
LAFAYETTE BUSINESS PARK, LLC
as Landlord
and
UNIVERSAL ACCESS, INC.
as Tenant
AFFECTING PREMISES COMMONLY KNOWN AS
0000 Xxxxxxxxx Xxxxxx
Xxxxx Xxxxx, Xxxxxxxxxx 00000
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SUMMARY OF BASIC LEASE TERMS
SECTION
(LEASE REFERENCE) TERMS
A.
(Introduction) LEASE REFERENCE DATE: April 1, 1999
B. LANDLORD: LAFAYETTE BUSINESS PARK, LLC,
(Introduction) a California limited liability company
C. TENANT: UNIVERSAL ACCESS, INC.,
(Introduction) an Illinois corporation
D. PREMISES: That area consisting of 15,600 square feet
(Section 1.15) of rentable area the address of which is 0000 Xxxxxxxxx
Xxxxxx, Xxxxx 000-000, Xxxxx Xxxxx, Xxxxxxxxxx, within
the Building approximately as shown on EXHIBIT A.
E. PROJECT: The land and improvements shown on EXHIBIT A
(Section 1.16) consisting of Four buildings the aggregate rentable
area of which is 65,400 square feet.
F. BUILDING: The building in which the Premises are
(Section 1.16) located known as 0000 Xxxxxxxxx Xxxxxx containing
15,600 square feet of rentable area.
G. TENANT'S SHARE: 100.00% of Building Common Operating
(Section 1.21) Expenses,
24.00% of Project Common Operating
Expenses
H.
(Section 4.4) TENANT'S ALLOCATED PARKING STALLS: Thirty-five (35)
stalls.
I. SCHEDULED COMMENCEMENT DATE: April 1, 1999
(Section 2.2)
J. LEASE TERM: Twelve (12) YEARS (plus the partial month
(Section 1.13) following the Commencement Date if such date is not the
first day of a month) with two (2), five (5) year
options to extend as set forth in EXHIBIT F.
K. INITIAL BASE MONTHLY RENT: $30,000.00
(Section 3.1/ Thereafter, annual CPI increases as described in the
Section 8.1) Lease Rider.
INITIAL MONTHLY XXX ESTIMATE: $625.00
INITIAL MONTHLY RENT AND XXX: $30,625.00
L. PREPAID RENT: $30,625.00 to be applied to first month's
(Section 3.3) rent.
M. SECURITY DEPOSIT: See Lease Rider.
(Section 3.6)
N. PERMITTED USE: Telecommunication business, including
(Section 4.1) general office use, the installation and maintenance of
its telecommunication systems and equipment and the
collocation of telephone systems belonging to Tenant's
customers.
O. TENANT'S LIABILITY INSURANCE MINIMUM: $1,000,000.00
(Section 9.1)
P. LANDLORD'S ADDRESS: 0000 Xxxx Xxxxxx
(Section 1.2) Xxxxxxxx, Xxxxxxxxxx 00000
Q. TENANT'S ADDRESS: 0000 Xxxxxxxxx Xxxxxx
(Section 1.2) Xxxxx Xxxxx, Xxxxxxxxxx 00000
R. LEASE: This lease includes the Summary of Basic Lease
(Section 1.12) Terms, the Lease, and the following exhibits and
addenda: Lease Rider, Exhibit A (site plan of the
Project indicating location of the Premises), Exhibit B
(Landlord's Improvements), Exhibit C (Sign Criteria),
Exhibit D (Surrender Condition), Exhibit E (Unit 206,
208 Lease), and Exhibit F (Option to Extend).
The foregoing Summary is hereby incorporated into and made a part of this
Lease. Each reference in this Lease to any form of the Summary shall mean the
respective information set forth above and shall be construed to incorporate
all of the terms provided under the particular paragraph pertaining to such
information. In the event of any conflict between the Summary and the Lease,
the Summary shall control.
LANDLORD: TENANT:
LAFAYETTE BUSINESS PARK, LLC UNIVERSAL ACCESS, INC.,
a California limited liability an Illinois corporation
company
By: /s/ XXX XXXXX By: /s/ XXXXXX X. XXXXXX
--------------------------------- ---------------------------------
Its: Manager Its: Chief Operating Officer
-------------------------------- --------------------------------
Dated: 3/31/99 Dated: 3/31/99
------------------------------ ------------------------------
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LEASE
ARTICLE I
DEFINITIONS
1.1 ADDITIONAL RENT: The term "Additional Rent" is defined in Section 3.2.
1.2 ADDRESS FOR NOTICES: The term "Address for Notices" shall mean the
addresses set forth in Sections P and Q of the Summary; provided, however, that
after the Commencement Date, Tenant's Address for Notices shall be the address
of the Premises.
1.3 AGENTS: The term "Agents" shall mean the following: (i) with respect
to Landlord or Tenant, the agents, employees, contractors, and invitees of such
party; and (ii) in addition with respect to Tenant, Tenant's subtenants and
their respective agents, employees, contractors, and invitees.
1.4 AGREED INTEREST RATE: The term "Agreed Interest Rate" shall mean the
lesser of (i) ten percent (10%) or (ii) the maximum interest rate permitted by
Law.
1.5 BASE MONTHLY RENT: The term "Base Monthly Rent" shall mean the fixed
monthly rent payable by Tenant pursuant to Paragraph 3.1 which is specified in
Section K of the Summary.
1.6 BUILDING: The term "Building" shall mean the building in which the
Premises are located which Building is identified in Section F of the Summary,
the rentable area of which is referred to herein as the "Building Rentable
Area."
1.7 COMMON AREA: The term "Common Area" shall mean all areas and
facilities within the Project that are not designated by Landlord for the
exclusive use of Tenant or any other lessee or other occupant of the Project,
including the parking areas, access and perimeter roads, pedestrian sidewalks,
landscaped areas, trash enclosures, recreation areas and the like.
1.8 COMMON OPERATING EXPENSES: The term "Common Operating Expenses" is
defined in Paragraph 8.2.
1.9 EFFECTIVE DATE: The term "Effective Date" shall mean the date the
last signatory to this Lease whose execution is required to make it binding on
the parties hereto shall have executed this Lease.
1.10 LANDLORD'S INSURANCE: The term "Landlord's Insurance" is defined in
Paragraph 9.2.
1.11 LAW: The term "Law" shall mean any judicial decision, statute,
resolution, regulation, rule, administrative court order, or other requirement
of any municipal, county, state, federal or other government agency or
authority having jurisdiction over the parties to this Lease or the Premises,
or both, in effect either at the Effective Date or any time during the Lease
Term.
1.12 LEASE: The term "Lease" shall mean the Summary and all elements of
this Lease identified in Section R of the Summary, all of which are attached
hereto and incorporated herein by this reference.
1.13 LEASE TERM: The term "Lease Term" shall mean the term of this Lease
which shall commence on the Commencement Date and continue for the period
specified in Section J of the Summary.
1.14 LENDER: The term "Lender" shall mean any beneficiary, mortgagee,
secured party, lessor, or other holder of any Security Instrument.
1.15 PREMISES: The term "Premises" shall mean the rentable area within
the Building described in Section D of the Summary located approximately as
shown on Exhibit A.
1.16 PROJECT: The term "Project" shall mean that real property and the
improvements thereon which are specified in Section E of the Summary, the
rentable area of which is referred to herein as the "Project Rentable Area."
1.17 REAL PROPERTY TAXES: The term "Real Property Taxes" is defined in
Paragraph 8.4.
1.18 SECURITY INSTRUMENT: The term "Security Instrument" shall mean any
underlying lease, mortgage or deed of trust which now or hereafter affects any
portion of the Project.
1.19 SUMMARY: The term "Summary" shall mean the Summary of Basic Lease
Terms executed by Landlord and Tenant that is part of this Lease.
1.20 TENANT'S ALTERATIONS: The term "Tenant's Alterations" shall mean all
improvements, additions, alterations, and fixtures installed in the Premises by
Tenant at its expense.
1.21 TENANT'S SHARE: The term "Tenant's Share" shall mean the percentage
obtained by dividing Tenant's rentable area by the Building Rentable Area,
which as of the Effective Date is the percentage identified in Section O of the
Summary.
ARTICLE 2
DEMISE, CONSTRUCTION, AND
ACCEPTANCE
2.1 DEMISE OF PREMISES: Landlord hereby leases to Tenant, and Tenant
leases from Landlord, the Premises for the Lease Term upon the terms and
conditions hereof.
2.2 COMMENCEMENT DATE: The Lease Term shall begin on the first to occur
of the following, which shall be the "Commencement Date": (i) the date
specified in Section J of the Summary (the "Scheduled Commencement Date") if
Landlord is not required to construct improvements under Exhibit B; or (ii) the
date Landlord offers to deliver possession of the Premises to Tenant following
substantial completion of all improvements to be constructed by Landlord under
Exhibit B, except for punchlist items which do not prevent Tenant from using
the Premises; or (iii) the date Tenant enters into occupancy of the Premises.
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2.3 DELIVERY AND ACCEPTANCE OF POSSESSION: If Landlord is unable to
deliver possession of the Premises to Tenant on or before the Scheduled
Commencement Date for any reason whatsoever, this Lease shall not be void or
voidable, and Landlord shall not be liable to Tenant for any loss or damage
resulting therefrom; provided that, the Lease Term shall not commence until
Landlord delivers possession of the Premises to Tenant. At the time Landlord
delivers possession of the Premises to Tenant, Tenant agrees to accept
possession of the Premises in its then existing condition, "as-is", including
all patent and latent defects, subject only to any defects in the Premises
existing at the time Tenant takes possession and of which Tenant notifies
Landlord in writing within one hundred eighty (180) days of the Commencement
Date.
ARTICLE 3
RENT
3.1 BASE MONTHLY RENT: Throughout the Lease Term, Tenant shall pay to
Landlord the Base Monthly Rent set forth in Section K of the Summary (the "Base
Monthly Rent").
3.2 ADDITIONAL RENT: All charges due from Tenant under this Lease shall
be deemed additional rent (the "Additional Rent").
3.3 PAYMENT OF RENT: Concurrently with the execution of this Lease,
Tenant shall pay to Landlord the amount set forth in Section L of the Summary
as prepayment of rent for credit against the first installment(s) of Base
Monthly Rent. All rent required to be paid in monthly installments shall be
paid in advance on the first day of each calendar month during the Lease Term
to Landlord at the address set forth in Section P of the Summary or to such
other address as Landlord may from time to time indicate. All rent shall be
paid in lawful money of the United States, without any abatement (except as set
forth herein) deduction or offset whatsoever, and without any prior demand
therefor.
3.4 LATE CHARGE AND INTEREST ON RENT IN DEFAULT: If any Base Monthly
Rent or Additional Rent is not received by Landlord from Tenant when due, then
Tenant shall immediately pay to Landlord a late charge equal to the greater of
(i) ten percent (10%) of such delinquent rent or (ii) One Hundred Dollars
($100.00), as liquidated damages for Tenant's failure to make timely payment.
If any rent remains delinquent for a period in excess of thirty (30) days then,
in addition to such late charge, Tenant shall pay to Landlord interest on any
rent that is not paid when due at the Agreed Interest Rate following the date
such amount became due until paid. This paragraph shall not be deemed to grant
Tenant an extension of time within which to pay rent or prevent Landlord from
exercising any other right or remedy.
3.5 RETURNED CHECK FEE: A Twenty Five Dollar ($25.00) charge will be
paid by Tenant as Additional Rent to Landlord for each check returned unpaid by
the bank and Tenant shall replace the payment with a Cashier's Check or
Certified Check. If Tenant has two (2) or more checks returned for insufficient
funds at any time during its tenancy, Landlord, at its option, may request all
payments, current and future, be made by Cashier's Check or Certified Check.
3.6 SECURITY DEPOSIT: On the Effective Date, Tenant shall deposit with
Landlord the amount set forth in Section M of the Summary as security for the
performance by Tenant of its obligations under this Lease, and not as
prepayment of rent (the "Security Deposit"). Landlord may from time to time
apply all or any portion of the Security Deposit to remedy any default by
Tenant to the extent permitted by Law. If any part of the Security Deposit is
so used, Tenant agrees to pay promptly upon demand an amount in cash sufficient
to restore the Security Deposit to the full original amount. Landlord shall not
be deemed a trustee of the Security Deposit, may use the Security Deposit in
business, and shall not be required to segregate it from its general accounts.
Tenant shall not be entitled to any interest on the Security Deposit.
ARTICLE 4
USE OF PREMISES
4.1 LIMITATION ON USE: Tenant shall use the Premises solely for the use
specified in Section N of the Summary (the "Permitted Use"). Tenant shall not
do anything in or about the Premises which will cause any damage or structural
injury to the Building or Common Area or operate any equipment within the
Premises which will overload, damage or impair electrical systems, HVAC,
sprinkler systems, sanitary sewer systems or other mechanical equipment
servicing the Building or the Project. Tenant shall not attach, hang or suspend
anything from the ceiling, roof, walls or columns of the Building or set any
load on the floor in excess of the load limits for which such items are
designed nor operate hard wheel forklifts within the Premises. Tenant shall not
change the exterior of the Building or install any equipment or antennas on or
make any penetrations of the exterior or roof of the Building. Tenant shall not
commit or permit any waste or nuisance in or about the Premises. Tenant shall
not conduct on any portion of the Premises or the Project any sale of any kind.
No articles of any kind shall be stored upon or permitted to remain outside of
the Premises.
4.2 COMPLIANCE WITH LAW: Tenant shall comply with, and shall not use
the Premises in any manner which violates any Laws now or hereafter affecting
the Project. Tenant shall not use the Premises in any manner which will cause a
cancellation of any insurance policy covering the Building or which poses an
unreasonable risk of damage or injury to the Premises. Tenant shall comply with
all reasonable requirements of any insurance company, insurance underwriter, or
Board of Fire Underwriters which are necessary to maintain the insurance
coverage carried by either Landlord or Tenant pursuant to this Lease.
Notwithstanding anything contained in this Lease to the contrary. Tenant shall
not be required to make any structural repairs or alterations to the Premises
which may be required by Law (whether presently existing or hereafter enacted),
insurance regulations or otherwise, except to the extent as may be required by
the acts or omissions of Tenant or its Agent or required as a result of
Tenant's or its Agent's specific use of the Premises.
4.3 SIGNS: Tenant shall not place on any portion of the Premises any
signage or communicative material which is visible from the exterior of the
Building without the prior written approval of Landlord. All such approved
signs shall strictly conform to all Laws, restrictive covenants and Landlord's
sign criteria attached as Exhibit C, and shall be installed and maintained in
good condition at the expense of Tenant throughout the Lease Term.
4.4 PARKING: Tenant shall be entitled to the non-exclusive use of
unreserved and unassigned parking spaces equal to the number of Tenant's
Allocated Parking Stalls contained within the Project described in Section H
of the Summary for its use and the use of Tenant's Agents, the location of
which may be designated from time to time by Landlord. Tenant and Tenant's
Agents shall park vehicles no larger than full size passenger automobiles or
pick-up trucks at the Project and any oversized vehicles (i.e., larger than
full size passenger automobiles or pick-up trucks) may be parked at the Project
only on a temporary basis for pick-up and delivery purposes. Tenant shall not
at any time park or permit the parking of Tenant's vehicles or trucks, or the
vehicles or trucks of its employees, invitees or others, in any portion of the
Common Area not designated by Landlord for such use by Tenant. Tenant shall not
abandon any inoperative vehicles or equipment on any portion of the Common
Area, nor shall Tenant, its employees, invitees, suppliers or others park or
store any vehicle on any portion of the Common Area, including designated
parking areas, unattended for any period longer than twenty-four (24)
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hours. Landlord reserves the right, after having given Tenant reasonable
notice, to have any vehicles owned by Tenant or Tenant's Agents utilizing
parking spaces in excess of the parking spaces allowed for Tenant's use or
parked in unauthorized areas to be towed away at Tenant's cost.
4.5 RULES AND REGULATIONS: Landlord may promulgate reasonable rules and
regulations applicable to the occupants of the Project. Such rules and
regulations shall be binding upon Tenant upon delivery of a copy to Tenant, and
Tenant agrees to abide by such rules and regulations. Landlord shall enforce
rules and regulations in a non-discriminatory manner.
ARTICLE 5
TRADE FIXTURES AND ALTERATIONS
5.1 TRADE FIXTURES: Throughout the Lease Term, Tenant may provide and
install, and shall maintain in good condition, any trade fixtures required in
the conduct of its business in the Premises. All trade fixtures shall remain
Tenant's property.
5.2 TENANT'S ALTERATIONS: Tenant shall not construct any Tenant's
Alterations or otherwise alter the Premises without Landlord's prior written
approval. At the expiration or sooner termination of the Lease Term, all
Tenant's Alterations shall be surrendered to Landlord as part of the realty and
shall then become Landlord's property, and Landlord shall have no obligation to
reimburse Tenant for all or any portion of the value or cost thereof; provided,
however, that if Landlord requires Tenant to remove any Tenant's Alterations,
Tenant shall so remove such Tenant's Alterations prior to the expiration or
sooner termination of the Lease Term. All Tenant's Alterations shall be
constructed by a licensed contractor in accordance with all Law, using new
materials of good quality. Landlord agrees that if Tenant requests in writing
prior to the installation of any Tenant Alterations that Landlord specify
whether it will require the removal of such Tenant's Alterations upon
termination or expiration of this Lease. Landlord shall so specify within ten
(10) days after Tenant's request. If Landlord fails to respond to such a
request, Landlord shall be deemed to have required the removal of such Tenant's
Alterations upon the termination or expiration of this Lease.
5.3 ALTERATIONS REQUIRED BY LAW: Tenant shall make any alteration,
addition or change of any sort to the Premises that is required by any Law
because of (i) Tenant's particular use or change of use of the Premises, (ii)
Tenant's application for any permit or governmental approval, or (iii) Tenant's
construction or installation of any Tenant's Alterations or trade fixtures.
5.4 MECHANIC'S LIENS: Tenant shall keep the Project free from any liens
and shall pay when due all bills arising out of any work performed, materials
furnished, or obligations incurred by Tenant or Tenant's Agents. If any claim
of lien is recorded, Tenant shall bond against or discharge the same within 30
days after the same has been recorded against the Project.
5.5 TAXES ON TENANT'S PROPERTY: Tenant shall pay before delinquency any
and all taxes, assessments, license fees and public charges imposed against
Tenant or Tenant's estate in this Lease or the property of Tenant.
ARTICLE 6
REPAIR AND MAINTENANCE
6.1 TENANT'S OBLIGATION TO MAINTAIN: Except as set forth in Section 6.2
below, Tenant shall, at its sole cost and expense, clean and maintain in good
order, condition, and repair and replace when necessary the Premises and every
part thereof regardless of whether the damaged portion of the Premises or the
means of repairing the same are accessible to Tenant, including but not limited
to, floors, ceilings, windows, doors, skylights, interior walls, and the
interior surfaces of the exterior walls, plumbing, all wall mounted HVAC
equipment serving only the Premises, telecommunications equipment and
intrabuilding network cabling, electrical and lighting facilities and equipment
including circuit breakers, and exterior lighting attached to the Premises. All
glass, both interior and exterior, is at the sole risk of Tenant and any broken
glass shall promptly be replaced by Tenant at Tenant's expense with glass of
the same kind, size and quality according to the current local code. In the
event Tenant fails to perform Tenant's obligations under this Paragraph 6.1,
Landlord shall give Tenant notice to do such acts as are reasonably required to
so maintain the Premises. If Tenant, within ten (10) days after notice from
Landlord, fails to commence to do the work and diligently prosecute it to
completion, then Landlord shall have the right (but not the obligation) to do
such acts and expend such funds at the expense of Tenant as are reasonably
required to perform such work. Any amount so expended by Landlord shall be paid
by Tenant promptly after demand with interest at the Agreed Interest Rate from
the date of such work until paid. Landlord shall have no liability to Tenant
for any damages, inconvenience or interference with the use of the Premises by
Tenant as a result of performing any such work. All repairs and replacements
required of Tenant shall be promptly made with new materials of like kind and
quality. If the work affects the structural parts of the Building or if the
estimated cost of any item of repair or replacement is in excess of One
Thousand Dollars ($1,000.00), then Tenant shall first obtain Landlord's written
approval of the same in accordance with Paragraph 5.2 hereof.
6.2 LANDLORD'S OBLIGATION TO MAINTAIN: Landlord shall, at its sole cost
and expense (subject to reimbursement as set forth in this Lease), repair,
maintain and operate the Common Area and repair and maintain the exterior roof,
all roof mounted HVAC equipment, the exterior and structural parts of the
Building so that the same are kept in good order and repair and if there is
building service equipment and/or utility facilities serving portions of the
Common Area and/or both the Premises and other parts of the Building, Landlord
shall maintain and operate (and replace when necessary) such equipment.
Landlord shall not be responsible for repairs required for damage caused to any
part of the Project by any act or omission of Tenant or Tenant's Agents and
Tenant shall be solely responsible for such repairs.
6.3 CONTROL OF COMMON AREA: Landlord shall at all times have exclusive
control of the Common Area. Subject to Xxxxxxxxx 00.0, Xxxxxxxx shall have the
right, without the same constituting an actual or constructive eviction and
without entitling Tenant to any abatement of rent, to close any part of the
Common Area for any reason, eliminate from or add to the Project any land or
improvement, make changes to the Common Area, remove unauthorized persons from
the Project, and/or change the name or address of the Building or Project.
Landlord shall have no obligation to provide guard services or other security
measures for the benefit of the Project and Tenant assumes all responsibility
for the protection of Tenant and Tenant's Agents from acts of third parties.
ARTICLE 7
WASTE DISPOSAL AND UTILITIES
7.1 WASTE DISPOSAL: Tenant shall cause all of its waste to be stored only
in designated areas and regularly removed from the Premises at Tenant's sole
cost; provided that, Landlord may elect to provide for waste disposal at the
Premises and/or Project and the cost thereof shall be considered a Common
Operating Expense. Tenant shall keep all fire corridors and mechanical
equipment rooms in the Premises free and clear of all obstructions.
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7.2 HAZARDOUS MATERIALS: Landlord and Tenant agree as follows with
respect to the existence or use of Hazardous Materials on the Project:
A. Any handling, transportation, storage, treatment, disposal or use
of Hazardous Materials by Tenant and Tenant's Agents in or about the Project
shall strictly comply with all applicable Hazardous Materials Laws. Tenant
shall indemnify, defend upon demand with counsel reasonably acceptable to
Landlord, and hold harmless Landlord from and against any and all liabilities,
losses, claims, damages, interest, penalties, fines, monetary sanctions,
reasonable attorneys' fees, expenses' fees, court costs, remediation costs,
investigation costs, and other expenses which result from or arise in any
manner whatsoever out of the use, storage, treatment, transportation, releases,
or disposal of Hazardous Materials on or about the Project by Tenant or
Tenant's Agents.
B. If the presence of Hazardous Materials on or about the Project
caused or permitted by Tenant or Tenant's Agents results in contamination of
water or soil, then Tenant shall promptly take any and all action necessary to
investigate and remediate such contamination as required by Law or as a
condition to the issuance or continuing effectiveness of any governmental
approval which relates to the use of the Project or any part thereof. Tenant
shall further be solely responsible for, and shall defend, indemnify and hold
Landlord and its agents harmless from and against all claims, costs and
liabilities, including attorneys' fees and costs, arising out of or in
connection with any investigation and remediation to return the Project to its
condition existing prior to the appearance of such Hazardous Materials.
C. Tenant shall give written notice to Landlord as soon as reasonably
practicable of (i) any communication received from any governmental authority
concerning Hazardous Materials which relates to the Project, and (ii) any
contamination of the Project by Hazardous Materials which constitutes a
violation of any Hazardous Materials Law. Tenant may use such Hazardous
Materials as are necessary to the operation of Tenant's business of which
Landlord receives notice prior to such Hazardous Materials being brought onto
the Premises and to which Landlord consents in writing. At any time during the
Lease Term, Tenant shall, within five days after written request therefor
received from Landlord, disclose in writing all Hazardous Materials that are
being used by Tenant on the Project, the nature and quantity of such use, and
the manner of storage and disposal. Landlord acknowledges that Tenant's use
requires batteries which may contain Hazardous Materials and Landlord consents
to Tenant's use of such batteries provided Tenant is in compliance with all
other terms of this Article 7.
D. Landlord may cause testing xxxxx to be installed on the Project,
and may cause the ground water to be tested to detect the presence of Hazardous
Material by the use of such tests as are then customarily used for such
purposes. The cost of such tests and of the installation, maintenance, repair
and replacement of such xxxxx shall be paid by Tenant if such tests disclose
the existence of facts which give rise to liability of Tenant pursuant to its
indemnity given in Paragraph 7.2A and or Paragraph 7.2B.
E. As used herein, the term "Hazardous Material" means any hazardous
or toxic substance, material or waste which is or becomes regulated by any
local governmental authority the State of California or the United States
Government. As used herein, the term "Hazardous Material Law" shall mean any
Law which regulates the use, storage, release or disposal of any Hazardous
Material.
F. The obligations of Landlord and Tenant under this Paragraph 7.2
shall survive the expiration or earlier termination of the Lease Term. The
rights and obligations of Landlord and Tenant with respect to issues relating
to Hazardous Materials are exclusively established by this Paragraph 7.2. In the
event of any inconsistency between any other part of this Lease and this
Paragraph 7.2, the terms of this Paragraph 7.2 shall control.
G. Landlord hereby represents and warrants to Tenant that, to the best
of its knowledge, no Hazardous Materials exist in or about the Project in
violation of Law. Landlord agrees to hold Tenant harmless from and against any
costs, liabilities, losses, claims, or damages resulting from the presence or
release of Hazardous Materials in or about the Project caused by Landlord, or
its Agents. Notwithstanding anything to the contrary contained in the Lease,
Tenant shall have no obligation to indemnify, defend, or hold Landlord harmless
for claims originating from the presence of Hazardous Materials which are not
placed on or in the Premises or the Project by the Tenant or its Agents.
Landlord and Tenant agree to comply with all relevant statues, ordinances and
regulations involving Hazardous Materials.
7.3 UTILITIES: Tenant shall promptly pay, as the same become due, all
charges for water, gas, electricity, telephone, sewer service, waste pick-up and
any other utilities, materials or services furnished to or used by Tenant on or
about the Premises during the Lease Term, including, without limitation,
meter, use and/or connection fees, book-up fees, or standby fees, and penalties
for discontinued or interrupted service. Landlord may, at Landlord's option,
require Tenant to place any utility service serving only the Premises in
Tenant's name. If any utility service is not separately metered to the
Premises, then Tenant shall pay its pro rata share of the cost of such utility
service with all others served by the service not separately metered. However,
if Landlord determines that Tenant is using a disproportionate amount of any
utility service not separately metered, then Landlord at its election may (i)
periodically charge Tenant, as Additional Rent, a sum equal to Landlord's
reasonable estimate of the cost of Tenant's excess use of such utility service,
or (ii) install a separate meter (as Tenant's expense) to measure the utility
service supplied to the Premises.
ARTICLE 8
COMMON OPERATING EXPENSES
8.1 TENANT'S OBLIGATION TO REIMBURSE COMMON OPERATING EXPENSES: As
Additional Rent, Tenant shall pay Tenant's Share (specified in Section G of the
Summary) of all Common Operating Expenses; provided, however, that if the
Project contains more than one building, then Tenant shall pay Tenant's Share
of all Common Operating Expenses fairly allocable to the Building, and provided
further, that Tenant shall pay all Common Operating Expenses fairly allocable
to the Premises. Tenant shall pay such share of the actual Common Operating
Expenses incurred or paid by Landlord but not theretofore billed to Tenant
within thirty (30) days after receipt of a written xxxx therefor from Landlord,
on such periodic basis as Landlord shall designate, but in no event more
frequently than once a month. Alternatively, Landlord may from time to time
require that Tenant pay Tenant's Share of Common Operating Expenses in advance
in estimated monthly or, at Landlord's option, quarterly installments, in
accordance with the following: (i) Landlord shall deliver to Tenant Landlord's
reasonable estimate of the Common Operating Expenses it anticipates will be paid
or incurred for the Landlord's fiscal year in question, (ii) during such
Landlord's fiscal year, Tenant shall pay Tenant's Share of the estimated Common
Operating Expenses in advance in equal monthly installments due with each
installment of Base Monthly Rent, and (iii) within ninety (90) days after the
end of such Landlord's fiscal year, Landlord shall furnish to Tenant a
statement in reasonable detail of the actual Common Operating Expenses paid or
incurred by Landlord in accordance with this paragraph during the just ended
Landlord's fiscal year, and thereupon there shall be an adjustment between
Landlord and Tenant, with payment to or repayment by Landlord, as the case may
require, within 30 days after delivery by Landlord to Tenant of such statement,
so that Landlord shall receive the entire amount of Tenant's Share of all
Common Operating Expenses for such Landlord's fiscal year and no more. Tenant
shall have the right, at its expense, exercisable upon reasonable written notice
to Landlord, to audit Landlord's books and records for Common Operating
Expenses provided such audit is conducted during normal business hours and
within twelve (12) months following the Lease year subject to audit. Landlord
shall pay the reasonable cost of such audit if it is determined that Tenant has
been overcharged for Common Operating Expenses by more than five percent (5%)
and shall promptly refund the amount of such overpayment to Tenant.
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8.2 COMMON OPERATING EXPENSES DEFINED: The term "Common Operating
Expenses" shall mean all costs and expenses incurred by Landlord with respect to
the operation, protection, improvement, maintenance, repair and replacement of
the Project, including, without limitation, the following: (i) the operation,
repair, maintenance and replacement of the roof (excluding replacement of the
roof structure and/or membrane), the exterior surfaces and interior
improvements of all buildings located on the Project, the roof mounted HVAC
equipment, utility facilities and other building service equipment, and the
Common Areas; (ii) reserves set aside for Common Operating Expenses or for
maintenance, repair and/or replacement of the Common Area; (iii) the amounts of
any "deductible" and "coinsurance" paid by Landlord with respect to damage
caused by an "Insured Peril" (as hereinafter defined) or amounts incurred in
connection with an "Uninsured Peril" (a hereinafter defined) up to a maximum
amount in any twelve (12) month period equal to two percent (2%) of the
replacement cost of the buildings or other improvements damaged; and (v)
reasonable management fees. Specifically excluded from Operating Expenses (to
the extent provided below) shall be the following:
(1) Costs of initial improvements to any tenant's premises, or any
architectural, engineering or legal fees, relocation expenses or any permit
or similar fees or charges associated with such improvements;
(2) Principal or interest payments on loans, including loans secured by
mortgages or trust deeds on the Project and ground lease payments, if any;
(3) Costs of capital improvements, except that Operating Expenses shall
include the cost during the Term, as reasonably amortized by Landlord pursuant
to sound management and accounting principles consistently applied, with
interest on the unamortized amount at ten percent (10%) per annum of any
capital improvements which are intended to reduce any component cost included
within Operating Expenses (and which, at such time, prudent owners of office
buildings in Santa Clara, California would reasonably determine to be
necessary);
(4) Depreciation or amortization of any improvements, except as
specifically set forth in this Lease;
(5) Costs of repairs, alterations or replacements caused by casualty
losses for which Landlord is compensated through proceeds of insurance or for
which Landlord would have been compensated had Landlord maintained the
insurance required by this Lease;
(6) Costs of repairs, alterations or replacements caused by the exercise
of the rights of eminent domain;
(7) Costs and expenses incurred in connection with leasing space in the
Project, such as legal fees for the preparation of leases, tenant allowances,
space planner fees, real estate brokers' leasing commissions and advertising
and promotional expenses, expenses of any leasing office incurred with regard
to leasing the Project or portions thereof;
(8) Court costs and legal fees incurred with regard to enforcing the
obligations of tenants under other leases;
(9) Leasing commissions, attorney's fees, costs and disbursements and
other expenses incurred in connection with negotiations or disputes with
tenants, occupants or prospective tenants or occupants of the Project;
(10) Costs incurred due to violation by Landlord of any lease for space in
the Project or any indemnity payments made by Landlord pursuant to any such
lease because of a violation by Landlord under such lease;
(11) Any payments made to subsidiaries of Landlord or entities under
common control with Landlord except if such payments are for services or goods
on, to or for the Building, and only to the extent that the cost of such
services and goods are at market rates being paid for such services or goods by
owners of other office buildings in Santa Clara, California from time to time;
(12) Any expense for which Landlord is compensated by proceeds of
insurance;
(13) Any expense for services or items for which any tenant of the
Building (including Tenant) directly reimburses Landlord (other than as a
component of Operating Expenses);
(14) Accounting fees (including those for the preparation of Landlord's
income taxes), except reasonable accounting fees incurred in connection with
the operation and management of the Project;
(15) Any lender's fees;
(16) Variable expenses that are not being furnished to Tenant, including,
without limitation, janitorial services and Buildings HVAC system;
(17) Costs of asbestos abatement and/or removal and/or any other measures
needed to comply with environmental requirements or to investigate or remediate
environmental contamination from Hazardous Materials except a set forth in
Article 7;
(18) Any costs, fines or penalties incurred due to violations by Landlord
of any governmental rule or authority;
(19) Management fees in excess of four percent (4%) of gross rents;
(20) Wages, salaries and other compensation paid to clerks or attendants
in newsstands or other commercial concessions, if any, operated by Landlord and
any expense or costs for wages, salaries or other benefits or compensation paid
to any person above the level of building manager;
(21) Costs relating to relocating existing tenants in the Project;
(22) Expenses arising as a result of Landlord's gross negligence or
willful misconduct or the negligence or willful misconduct of Landlord's agents
or employees;
(23) Real Property Taxes (reimbursement of Real Property Taxes is dealt
with exclusively in Article 8.4); and
(24) Repairs necessary to bring the Project or any part thereof into
compliance with Laws in effect as of the Commencement Date.
8.3 TENANTS OBLIGATION TO REIMBURSE REAL PROPERTY TAXES AND LANDLORD'S
INSURANCE: As Additional Rent, Tenant shall pay Tenant's Share (specified in
Section G of the Summary) of the amount (if any) by which Real Property Taxes
and/or Landlord's Insurance costs paid or incurred in any Landlord's fiscal
year during the Lease Term exceed the Real
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Property Taxes and/or Landlord's Insurance costs, respectively, paid or incurred
during the fiscal year in which the Commencement Date occurs (which excess is
referred to herein as the "Excess Expenses") for any annual period or portion
thereof. If the Project contains more than one building, then Tenant shall pay
Tenant's share of the Excess Expenses for the Landlord's fiscal year in question
based upon the Real Property Taxes under Landlord's Insurance costs fairly
allocable to the Building. Tenant shall pay such share of the Excess Expenses on
the same payment terms as are contained in 98.1 hereof regarding payment of
Common Operating Expenses.
8.4 REAL PROPERTY TAXES DEFINED. The term "Real Property Taxes" shall
mean all taxes, assessments, levies, and other charges of any kind or nature
whatsoever, general and special, foreseen and unforeseen, now or hereafter by
any governmental or quasi-governmental authority or special district having the
direct or indirect power to tax or levy assessments, which are levied against,
or with respect to the value, occupancy or use of, all or any portion of the
Project or the rents derived therefrom (except federal and state net income
taxes). Notwithstanding anything contained in the Lease to the contrary, during
the first five (5) years of the Lease Term only (after such time this exclusion
shall no longer apply) there shall be excluded from the tax xxxx for the
purposes of computing Real Property Taxes, any increase in real estate taxes
caused by a "change in ownership" as defined in the law under which reassessment
or tax increase results from a transfer of all or a portion of Landlord's
interest in the Project. Real Property Taxes shall also not include interest and
penalties for the payment. If assessment or other special taxes that are payable
in installments are levied against all or any portion of the Project, Landlord
shall pay such assessments or taxes in installments over the maximum period of
time permitted by law, and all interest payments thereon shall be considered
part of the assessment for purposes of this provision. Landlord represents that
the Project is assessed as a single tax parcel for Real Property Tax purposes
separate and apart from any other land.
ARTICLE 9
INSURANCE
9.1 TENANT'S INSURANCE. Tenant shall maintain insurance complying with
all of the following:
A. Tenant shall procure, pay for and keep in full force and effect:
(i) commercial general liability insurance, including property damage, against
liability for personal injury, bodily injury, death and damage to property
occurring in or about, or resulting from on occurrence in or about the Premises
with combined single limit coverage of not less than the amount specified in
Section O of the Summary, which insurance shall contain a "contractual
liability" enforcement insuring performance of Tenant's obligation to indemnify
Landlord contained in Section 10.3; (ii) fire and property damage insurance in
so-called "all risk" from insuring Tenant's Alterations for their full actual
replacement costs; and (iii) such other insurance and amounts of insurance as
are either (1) reasonably required by any Lender, or (2) reasonably required by
Landlord required by Landlord and customarily carried by tenants of similar
property in similar businesses.
B. Where applicable and required by Landlord, each policy of
insurance required to be carried by Tenant pursuant to this paragraph 9.1: (i)
shall name Landlord and such other parties in interest as Landlord reasonably
designates as additional insured; (ii) shall be primary and not secondary or
contributing; (iii) shall be in a form and carried with companies reasonably
acceptable to Landlord; (iv) shall provide that such policy shall not be
subject to cancellation, lapse or change except after at least thirty (30) days
prior written notice to Landlord; (v) shall not have a "deductible" in excess
of such amounts as are approved by Landlord; and (vi) shall contain a cross
liability endorsement and a "severability" clause.
C. A copy of each paid-up evidencing the insurance required to be
carried by Tenant pursuant to this paragraph 9.1 (appropriately authenticated
by the insurer) shall be delivered to Landlord prior to the time Tenant or any
of its Agents enters the Premises and upon renewal of such policies, but not
less than five (5) days prior to the expiration of the term of such coverage.
D. Tenant shall have the right to maintain the required liability
insurance in the form of a blanket policy covering other business locations of
Tenant in addition to the Premises; provided, however, that Tenant shall
provide Landlord with a certificate of insurance specifically naming the
location of the Premises and naming Landlord as required in this Section, the
limits of which coverage applicable to the Premises are to be in the amounts
set forth in this Section.
9.2 LANDLORD'S INSURANCE: Landlord shall maintain a policy or policies of
fire and property damage insurance in so-called "all risk" form insuring
Landlord (and such others as Landlord may designate) from physical damage to
the Project with coverage of not less than the full replacement cost thereof,
and if Landlord elects, a commercial general liability policy ("Landlord's
Insurance"). Such insurance may be endorsed to cover loss caused by such
additional perils against which Landlord may elect to insure (including
earthquake and/or flood), and to provide such additional coverage as Landlord
reasonably requires, and shall contain reasonable "deductibles" which, in the
case of earthquake and flood insurance, may be up to such amount as is then
available at commercially reasonable rates. Landlord shall not be required to
cause such insurance to cover any of Tenant's Alterations or trade fixtures.
9.3 RELEASE AND WAIVER OF SUBROGATION: The parties hereto release each
other, and their respective agents and employees, from any liability for injury
to any person or damage to property that is caused by or results from any risk
insured against under any valid and collectible insurance policy carried by
either of the parties which contains a waiver of subrogation by the insurer and
is in force at the time of such injury or damage, subject to the following
limitations: (i) the foregoing provision shall not apply to the commercial
general liability insurance described by subparagraph 9.1A; and (ii) Tenant
shall not be released from any such liability to the extent any damages
resulting from such injury or damage are not covered by the recovery obtained
by Landlord from such insurance, but only if the insurance in questions permits
such partial release in connection with obtaining a waiver of subrogation from
the insurer. Each party shall use reasonable efforts to cause each insurance
policy obtained by it to provide that the insurer waives all right of recovery
by way of subrogation against the other party and its agents and employees.
ARTICLE 10
LIMITATION ON LANDLORD'S LIABILITY
AND INDEMNITY
10.1 LIMITATION ON LANDLORD'S LIABILITY: Landlord shall not be liable to
Tenant, nor shall Tenant be entitled to terminate this Lease or to any
abatement of rent, for any injury to Tenant or Tenant's Agents, damage to the
property of Tenant or Tenant's Agents, or loss to Tenant's business resulting
from any cause whatsoever unless same is proximately caused by Landlord's
willful misconduct or gross negligence of which Landlord has actual notice and
a reasonable opportunity to cure but which it fails to so cure.
10.2 LIMITATION ON TENANT'S RECOURSE: Tenant shall have recourse only to
the interest of Landlord in the Project for the satisfaction of the obligations
of Landlord and shall not have recourse to any other assets of Landlord or to
the assets of any officers, directors, trustees, partners, joint venturers,
members, owners, stockholders, or other principals or representatives of
Landlord for the satisfaction of such obligations.
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10.3 INDEMNIFICATION OF LANDLORD: Tenant shall hold harmless, indemnify
and defend Landlord, and its employees, agents and contractors, with competent
counsel reasonably satisfactory to Landlord, from all liability, penalties,
losses, damages, costs, expenses, causes of action, claims and/or judgments
arising from or relating to (i) any cause or causes whatsoever (other than the
willful misconduct or gross negligence of Landlord of which Landlord has had
notice and a reasonable time to cure, but which Landlord has failed to cure)
occurring in or about or resulting from an occurrence in or about the Premises
during the Lease Term, (ii) the negligence or willful misconduct of Tenant or
Tenant's Agent, wherever the same may occur, or (iii) an Event of Tenant's
Default. The provisions of this p10.3 shall survive the expiration or sooner
termination of this Lease. Notwithstanding anything herein to the contrary,
Landlord shall not be indemnified from any liability for damage or injury to
persons or property caused by or resulting from the gross negligence or wanton
misconduct of Landlord or its Agents.
ARTICLE 11
DAMAGES TO PREMISES
11.1 LANDLORD'S DUTY TO RESTORE: If the Premises are damaged by any
peril, Landlord shall restore the Premises unless the Lease is terminated by
Landlord pursuant to p11.2. All insurance proceeds available from the fire and
property damage insurance carried by Landlord pursuant to p9.2 shall be paid to
and become the property of Landlord. Landlord's obligation to restore shall be
limited to the Premises and Interior Improvements constructed by Landlord as
they existed as of the Commencement Date, excluding any Tenant's Alterations,
trade fixtures and/or personal property. Tenant shall forthwith replace or
fully repair all Tenant's Alterations and trade fixtures existing at the time
of the damage.
11.2 LANDLORD'S RIGHT TO TERMINATE: Landlord shall have the right to
terminate this Lease in the event any of the following occurs: (i) either the
Project or the Building is damaged by an Insured Peril to such an extent that
the estimated cost to restore exceeds thirty three (33%) of the then actual
replacement cost thereof; (ii) either the Project or the Building is damaged by
an Uninsured Peril to such an extent that the estimated cost to restore exceeds
two percent (2%) of the then actual replacement cost thereof; or (iii) the
Premises are damaged by any peril within twelve (12) months of the last day of
the Lease Term. As used herein, "Insured Peril" shall mean a peril actually
insured against for which the insurance proceeds actually received by Landlord
are sufficient (except for any "deductible" amount specified by such insurance)
to restore the Project under then-existing building codes to the condition
existing immediately prior to the damage; and "Uninsured Peril" shall mean any
peril which is not an Insured Peril. Notwithstanding the foregoing, if the
"deductible" for earthquake or flood insurance exceeds two percent (2%) of the
replacement cost of the Improvements Insured, such peril shall be deemed an
"Uninsured Peril."
11.3 ABATEMENT OF RENT: In the event of damage to the Premises which does
not result in the termination of this Lease, the Base Monthly Rent and the
Additional Rent shall be temporarily abated during the period of restoration in
proportion to the degree to which Tenant's use of the Premises is impaired by
such damage. Tenant shall be entitled to any compensation or damage from
Landlord for loss of Tenant's business or property caused by such damage or
restoration. Tenant hereby waives the provisions of California Civil Code
Sections 1932(2) and 1933(4) and the provisions of any similar law hereinafter
enacted.
11.4 TENANT'S RIGHT TO TERMINATE: If the Premises are damaged by any
peril and Landlord does not elect to terminate this Lease or is not entitled
to terminate this Lease pursuant to this Article, then as soon as reasonably
practicable, Landlord shall furnish Tenant with the written opinion of
Landlord's architect or construction consultant as to when the restoration work
required of Landlord may be complete. Tenant shall have the opinion to
terminate this Lease in the event any of the following occurs, which option may
be exercised in the case of A or B below only by delivery to Landlord of a
written notice of election to terminate within ten (10) business days after
Tenant receives from Landlord the estimate of the time needed to complete such
restoration:
A. If the time estimated to substantially complete the restoration
exceeds nine months from and after the date of such damage; or
B. If the damage occurred within nine months of the last day of the
Term and the time estimated to substantially complete the restoration exceeds
ninety days from and after the date such restoration is commenced; or
C. Landlord does not complete the restoration within nine months
from the date of the damage.
ARTICLE 12
CONDEMNATION
12.1 LANDLORD'S TERMINATION RIGHT: Landlord shall have the right to
terminate this Lease if, as a result of a condemnation, more than 40% of the
Premises or 20% of the Project is so taken; provided that if Landlord elects to
terminate due to 20% of the Project being taken, Landlord terminates the Leases
of substantially all other Tenants at the Project.
12.2 TENANT'S TERMINATION RIGHT: Tenant shall have the right to terminate
this Lease if, as a result of any condemnation, ten percent (10%) or more of
the Premises is taken and the remaining part of the Premises cannot be restored
within a reasonable period of time and thereby made reasonably suitable for the
continued operation of the Tenant's business.
12.3 ABATEMENT OF RENT: If any part of the Premises is taken by
condemnation and this Lease is not terminated, Base Monthly Rent shall be
reduced in the same proportion that the floor area of that part of the Premises
so taken (less any addition thereto by reason of any recommendation) bears to
the original floor area of the Premises.
12.4 DIVISION OF CONDEMNATION AWARD: Any award made as a result of any
condemnation of the Premises or the Common Area shall belong to and be paid to
Landlord, and Tenant hereby assigns to Landlord all of its right, title and
interest in any such award.
ARTICLE 13
DEFAULT AND REMEDIES
13.1 EVENTS OF TENANT'S DEFAULT: Tenant shall be in default of its
obligations under this Lease if any of the following event occurs (an "Event of
Tenant's Default").
A. Tenant shall have failed to pay Base Monthly Rent or Additional
Rent when due, and such failure is not cured within 3 days after delivery of
written notice from Landlord specifying such failure to pay; or
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B. Tenant shall have failed to perform any term, covenant, or
condition of this Lease other than those requiring the payment of Base Monthly
Rent or Additional Rent, and Tenant shall have failed to cure such breach within
thirty (30) days after written notice from Landlord specifying the nature of
such breach where such breach could reasonably be cured within said thirty (30)
day period, or if such breach could not reasonably be cured within said thirty
(30) day period, Tenant shall have failed to commence such cure within said
thirty (30) day period and thereafter continue with due diligence to prosecute
such cure to completion within such time period as is reasonably needed; or
C. Tenant shall have sublet the Premises or assigned its
interest in the Lease in violation of the provisions contained in Article 14; or
D. (i) The making by Tenant of any general arrangements or
assignments for the benefit of creditors; (ii) Tenant becomes a "debtor" as
defined in 11 USC [PARAGRAPH]101 or any successor statute thereto (unless, in
the case of a petition filed against Tenant, the same is dismissed within ninety
(90) days; (iii) the appointment of a trustee or receiver to take possession of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where possession is not restored to Tenant within sixty
(60) days; or (iv) the attachment, execution or other judicial seizure of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where such seizure is not discharged within sixty (60)
days; provided, however, in the event that any provision of this
[PARAGRAPH]13.1D is contrary to any applicable Law, such provision shall be of
no force or effect; or
E. Tenant shall have failed to deliver documents required of it
pursuant to [PARAGRAPH]15.4 or [PARAGRAPH]15.6 within the time periods specified
therein.
13.2 LANDLORD'S REMEDIES: If an Event of Tenant's Default occurs,
Landlord shall have the following rights and remedies in addition to all other
rights and remedies provided by Law or otherwise provided in this Lease, to
which Landlord may resort cumulatively or in the alternative:
A. This Lease shall not terminate unless Landlord gives Tenant
written notice of its election to terminate and no act by or on behalf of
Landlord intended to mitigate the adverse effect of such breach shall
constitute a termination of Tenant's right to possession unless Landlord gives
Tenant written notice of termination. Should Landlord not terminate this Lease
by giving Tenant written notice, Landlord may enforce all of its rights and
remedies under this Lease or available at law or in equity, including (i) the
right to perform Tenant's obligations and be reimbursed by Tenant for the cost
thereof together with interest at the Agreed Interest Rate from the date any sum
is paid by Landlord until Landlord is reimbursed by Tenant, and (ii) the remedy
described in California Civil Code Section 1951.4 (Landlord may continue Lease
in effect after Tenant's breach and abandonment and recover rent as it becomes
due, if Tenant has right to sublet or assign, subject only to reasonable
limitations).
B. Landlord may terminate this lease, in which event Landlord
shall be entitled, at Landlord's election, to damages in an amount as set forth
in California Civil Code Section 1951.2. For purposes of computing damages
pursuant to California Civil Code Section 1951.2: (i) an interest rate equal to
the Agreed Interest Rate shall be used where permitted; and (ii) the term "rent"
includes Base Monthly Rent and Additional Rent. Such damages shall include: (i)
the worth at the time of award of the amount by which the unpaid rent for the
balance of the term after the time of award exceeds the amount of such rental
loss that Tenant proves could be reasonably avoided, computed by discounting
such amount at the discount rate of the Federal Reserve Bank of San Francisco at
the time of award plus one percent (1%); and (ii) any other amount necessary to
compensate Landlord for all detriment proximately caused by Tenant's failure to
perform Tenant's obligations under this Lease, or which in the ordinary course
of things would be likely to result therefrom.
C. The remedies set forth herein are not intended to be
exclusive and shall be in addition to the rights and remedies granted to
Landlord by Law or in equity. Nothing in this [PARAGRAPH]13.2 shall limit
Landlord's right to indemnification from Tenant as provided in [PARAGRAPH]7.2
and [PARAGRAPH]10.3. Any notice given by Landlord in order to satisfy the
requirements of [PARAGRAPH]13.1A or [PARAGRAPH]13.1B above shall also satisfy
the notice requirements of California Code of Civil Procedure Section 1161
regarding unlawful detainer proceedings.
13.3 WAIVER: Landlord's consent to or approval of any act by Tenant
requiring Landlord's consent or approval shall not be deemed to waive or render
unnecessary Landlord's consent to or approval of any subsequent similar act by
Tenant. The receipt by Landlord of any rent or payment with or without knowledge
of the breach of any provision hereof shall not be deemed a waiver of or consent
to any such breach unless such waiver is in writing and signed by Landlord. No
delay or omission in the exercise of any right or remedy accruing to Landlord
upon any breach by Tenant shall impair such right or remedy or be construed as a
waiver of any such breach theretofore or thereafter occurring. The waiver by
either party of any breach of any provision of this Lease shall not be deemed to
be a waiver of any subsequent breach of the same or of any other provisions
herein contained.
13.4 WAIVER BY TENANT OF CERTAIN REMEDIES: Tenant waives the
provisions of Sections 1932(1), 1941 and 1942 of the California Civil Code and
any similar or successor law regarding Tenant's right to terminate this Lease or
to make repairs and deduct the expenses of such repairs from the rent due under
this Lease. Tenant hereby waives any right of redemption or relief from
forfeiture under the laws of the State of California, or under any other present
or future law, including the provisions of Sections 1174 and 1179 of the
California Code of Civil Procedure.
ARTICLE 14
ASSIGNMENT AND SUBLETTING
14.1 TRANSFER BY TENANT: The following provisions shall apply to any
assignment, subletting or other transfer by Tenant or any subtenant or assignee
or other successor in interest of the original Tenant (collectively referred to
in this [PARAGRAPH]14.1 as "Tenant"):
A. Tenant shall not do any of the following (collectively
referred to herein as a "Transfer"), whether voluntarily, involuntarily or by
operation of law, without the prior written consent of Landlord, which consent
shall not be unreasonably withheld or delayed; (i) sublet all or any part of
the Premises or allow it to be sublet, occupied or used by any person or entity
other than Tenant or assign its interest in this Lease; (ii) mortgage or
encumber the Lease (or otherwise use the Lease as a security device) in any
manner; or (iii) amend or modify an assignment, sublease or other transfer that
has been previously approved by Landlord. The dissolution, merger, or other
reorganization of Tenant or the sale, transfer, withdrawal, or substitution of
twenty five percent (25%) or more of the ownership interest in Tenant shall be
deemed a Transfer. Any attempted Transfer without Landlord's consent shall
constitute an Event of Default and shall be voidable at Landlord's option. No
Transfer, even with the consent of Landlord, shall relieve Tenant of its
personal and primary obligation to pay the rent and to perform all of the other
obligations to be performed by Tenant hereunder. Tenant shall reimburse Landlord
for all reasonable costs and attorneys' fees in connection with the processing
and/or documentation of a requested Transfer, whether or not Landlord's consent
is given. In the event Landlord consents to any proposed Transfer, Tenant agrees
to pay to Landlord, as Additional Rent, fifty percent (50%) of any and all rents
or other consideration (including key money) received by Tenant from the
transferee by reason of such Transfer in excess of the rent payable by Tenant to
Landlord under this Lease (less any brokerage commissions, attorneys' fees and
advertising expenses incurred by Tenant in connection with the Transfer).
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B. At least thirty (30) days before a proposed Transfer is to
become effective, Tenant shall give Landlord written notice of the proposed
terms of such Transfer and request Landlord's approval, which notice shall
include the name and legal composition of the proposed transferee, a current
financial statement and financial statements of the transferee covering the
preceding three years if the same exist all of which statements prepared in
accordance with generally accepted accounting principles, the nature of the
proposed transferee's business to be carried on in the Premises, and the form of
Transfer agreement to be used. Tenant shall provide to Landlord such other
information as may be reasonably requested by Landlord, and Tenant shall
immediately notify Landlord of any material modification to the proposed terms
of such Transfer.
C. In the event that Tenant seeks to make any Transfer, Landlord
shall have the right to terminate this Lease or, in the case of a sublease of
less than all of the Premises, terminate this Lease as to that part of the
Premises proposed to be so sublet. Upon such termination, Tenant shall be
released from any further obligation under this Lease if it is terminated in its
entirety, or shall be released from any further obligation under the Lease with
respect to the space proposed to be sublet in the case of a proposed partial
sublease. In the case of a partial termination of the Lease, the Base Monthly
Rent and Tenant's Share shall be reduced to an amount which bears the same
relationship to the original amount thereof as the area of that part of the
Premises which remains subject to the Lease bears to the original area of the
Premises. Landlord and Tenant shall execute a cancellation and release with
respect to the Lease to effect such termination.
D. Notwithstanding anything contained herein to the contrary,
none of the following, or any changes, assignments or transfers resulting from
the following, shall be deemed a "Transfer" or require Landlord's prior written
consent, the payment by Tenant of any fees or charges of any kind, or give rise
to any right of Landlord to cancel or recapture all or any part of the Premises;
provided, however, Tenant shall provide at least twenty (20) days prior written
notice of each transfer below (except subparagraph v) and shall provide Landlord
with all information regarding such transfer as is reasonably requested by
Landlord:
(i) a transfer by Tenant of its interest in this Lease to a
person or entity controlling, controlled by or under common control with Tenant;
(ii) a transfer of or change in the ownership interest of
Tenant as long as the new ownership interest continues to operate the business
of the Tenant in the same manner; provided such new ownership interest has an
equal to or greater net worth than existing ownership at the time of transfer;
(iii) a transaction in which Tenant becomes an entity whose
shares of stock or other ownership interests are, directly or indirectly, sold
on a national stock exchange or an inter-dealer quotation system; and in the
event the foregoing transaction has occurred, any subsequent sale of ownership
interests or issuance of new ownership interest, directly or indirectly, in
Tenant;
(iv) the merger, consolidation or amalgamation of Tenant
with a third party or the sale of all, or substantially all, of the assets used
by Tenant in the conduct of its business at the Premises; provided such new
ownership interest has an equal to or greater net worth than existing ownership
at the time of Transfer; and
(v) any license or co-location agreement of portions of the
Premises to persons or entities which inter-connect with Tenant's equipment in
the Premises.
E. Landlord acknowledges that Tenant's Permitted Use requires
the installation in the Premises of certain telecommunications equipment owned
by customers, licensees and co-locators of Tenant ("Tenant Customers") in order
for such Tenant Customers to Interconnect with Tenant's equipment or to permit
Tenant to manage or operate such Tenant Customers' equipment. Notwithstanding
anything to the contrary provided herein, Landlord approves such use of portions
of the Premises by Tenant Customers for such purposes without Landlord's further
consent. All use or occupancy of the Premises by said Tenant Customers shall
comply with the terms of the Lease and any and all applicable governmental laws,
rules, or regulations, and shall be in the form of a license agreement which
shall terminate upon any termination of the Lease.
14.2 TRANSFER BY LANDLORD: Landlord and its successors in interest
shall have the right to transfer their interest in this Lease and the Project
at any time. In the event of any such transfer, the Landlord originally named
herein (and, in the case of any subsequent transfer, the transferor) shall
automatically be relieved, from the date of such transfer and without any
further act by any person or entity, of all liability for the performance of the
obligations of the Landlord hereunder which may accrue after the date of such
transfer.
ARTICLE 15
GENERAL PROVISIONS
15.1 LANDLORD'S RIGHT TO ENTER: Landlord and its agents may enter
the Premises at any reasonable time after giving at least twenty four (24)
hours' prior notice to Tenant (and immediately in the case of emergency) for
any reasonable purpose including, without limitation, showing the Premises to
prospective purchasers, mortgagees or tenants and posting upon the Premises
ordinary "for lease" signs or "for sale" signs. Landlord shall have the right
to use any and all means Landlord may deem necessary and proper to enter the
Premises in an emergency. Any entry into the Premises obtained by Landlord in
accordance with this Paragraph 15.1 shall not be a forcible or unlawful entry
into, or a detainer of, the Premises, or an actual or constructive eviction of
Tenant from the Premises. No entry or repairs by Landlord or rights reserved to
Landlord to alter, modify or otherwise improve all or any part of the Project
shall be deemed or construed to be a disturbance of Tenant's quiet or peaceful
possession of the Premises so long as the aforesaid work or actions do not
disturb or disrupt Tenant's business operations. Tenant shall have the right
to install its own security in the Building provided that Tenant provides
Landlord with the information necessary to allow Landlord (and emergency
personnel) access to the Building in the event of an emergency.
15.2 SURRENDER OF THE PREMISES: Upon the expiration or sooner
termination of this Lease, Tenant shall vacate and surrender the Premises to
Landlord in the same condition as existed at the Commencement Date, broom clean,
ordinary wear and tear, fire, other casualty and condemnations excepted. Tenant,
at its sole cost and expense, agrees to repair any damage to the Premises caused
by Tenant or caused by or in connection with the removal of any articles of
personal property, business or trade fixtures, machinery, equipment, or
furniture, including without limitation thereto, repairing the floor and
patching and painting the walls where required by Landlord to Landlord's
reasonable satisfaction. Tenant shall indemnify Landlord against any loss or
liability resulting from delay by Tenant in so surrendering the Premises,
including without limitation, any claims made by any succeeding tenant founded
on such delay. If the Premises are not so surrendered at the termination of this
Lease, Tenant shall be liable to Landlord for all costs incurred by Landlord in
returning the Premises to the required condition, plus interest on all costs
incurred at the Agreed Interest Rate. Tenant shall indemnify Landlord against
loss or liability resulting from delay by Tenant in so surrendering the
Premises.
15.3 HOLDING OVER: This Lease shall terminate without further notice
at the expiration of the Lease Term. Any holding over by Tenant after
expiration of the Lease Term shall not constitute a renewal or extension of the
Lease or give Tenant any
9
12
rights in or to the Premises except as expressly provided in this Lease. Any
holding over after such expiration with the written consent of Landlord shall
be construed to be a tenancy from month to month on the same terms and
conditions herein specified insofar as applicable except that Base Monthly Rent
shall be increased to an amount equal to one hundred and fifty percent (150%)
of the Base Monthly Rent payable during the last full calendar month of the
Lease Term.
15.4 SUBORDINATION: This Lease is subject and subordinate to all Security
Instruments now or hereafter encumbering the Premises. However, if any Lender
so requires, this Lease shall become prior and superior to any such Security
Instrument. Tenant shall upon request execute any document or instrument
reasonably required by any Lender to make this Lease either superior or
subordinate to a Security Instrument, which may include such other matters as
the Lender reasonably requires in connection with such agreements; provided,
such Lender agrees to recognize Tenant's rights under this Lease and agrees not
to disturb Tenant's quiet possession of the Premises so long as there is no
Event of Tenant's Default. Landlord, if requested by Tenant, shall use
reasonable efforts to obtain a recognition and non-disturbance agreement from
any existing Lender. Tenant's failure to execute any such document or
instrument within ten (10) days after written demand therefor shall constitute
an Event of Tenant's Default.
15.5 ATTORNMENT: Tenant shall attorn to any purchaser of the Premises at
any foreclosure sale or private sale conducted pursuant to any Security
Instrument encumbering the Premises, or to any grantee or transferee designated
in any deed given in lieu of foreclosure.
15.6 ESTOPPEL CERTIFICATES: At all times during the Lease Term, Tenant
agrees to execute and deliver to Landlord within 10 business days following
delivery of Landlord's request an estoppel certificate certifying such factual
information about the Lease and such financial information of Tenant as may be
reasonably required by Landlord.
15.7 NOTICES: Any notice required or desired to be given regarding this
Lease shall be in writing and may be given by personal delivery, by facsimile
telecopy, or by mail. A notice shall be deemed to have been given (i) on the
third business day after mailing if such notice was deposited in the United
States mail, certified or registered, postage prepaid, addressed to the party
to be served at its Address for Notice, (ii) when delivered if given by
personal delivery, and (iii) in all other cases when actually received at the
party's Address for Notices. Either party may change its address by giving
notice of the same in accordance with this Paragraph 15.7.
15.8 ATTORNEYS' FEES: If either Landlord or Tenant shall bring any action
or legal proceeding for an alleged breach of any provision of this Lease, to
recover rent, to terminate this Lease or otherwise to enforce, protect or
establish any term or covenant of this Lease, the prevailing party shall be
entitled to recover as a part of such action or proceeding, or in a separate
action brought for that purpose, reasonable attorneys' fees, court costs, and
experts' fees as may be fixed by the court.
15.9 CORPORATE AUTHORITY: If Tenant is a corporation or partnership, each
individual executing this Lease on behalf of Tenant represents and warrants
that he or she is duly authorized to execute and deliver this Lease on behalf
of such corporation or partnership and that this Lease is binding upon such
corporation or partnership in accordance with its terms.
15.10 MISCELLANEOUS: Time is of the essence of this Lease. This Lease
shall, subject to the provisions regarding assignment, apply to and bind the
respective heirs, successors, executors, administrators and assigns of Landlord
and Tenant. If Tenant consists of more than one person or entity, then all
members of Tenant shall be jointly and severally liable hereunder. The
language in all parts of this Lease shall in all cases be construed as a whole
according to its fair meaning, and not strictly for or against either Landlord
or Tenant. Landlord and Tenant agree that (i) the rentable area of the Premises
is measured from the exterior faces of exterior walls to the centerline or
interior partitions and includes any atriums, depressed loading docks, covered
entrances or egresses, and covered loading areas, and (ii) all measurements of
area contained in this Lease are conclusively agreed to be correct and binding
upon the parties for all purposes hereunder, even if a subsequent measurement
of any one of these areas determines that it is more or less than the amount of
area reflected in this Lease. Any prevention, delay or stoppage due to
inclement weather, inability to obtain labor or materials, governmental
restrictions, fire or other acts of God, and other causes beyond the reasonable
control of the party obligated to perform (except financial inability) shall
excuse the performance, for a period equal to the period of any said
prevention, delay or stoppage, of any obligation hereunder except the
obligation of Tenant to pay rent or any other sums due hereunder.
15.11 ENTIRE AGREEMENT: This lease constitutes the entire agreement
between the parties, and there are no agreements or representations between the
parties except as expressed herein. This Lease supersedes and cancels any and
all previous negotiations, arrangements, brochures and understandings, if any,
between Landlord and Tenant. No modification to this Lease shall be effective
unless in writing signed by the parties. This Lease shall not be legally
binding until fully executed by Landlord and Tenant.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease to be
effective as of the Effective Date.
LANDLORD: TENANT:
LAFAYETTE BUSINESS PARK, LLC UNIVERSAL ACCESS, INC.
a California limited liability company an Illinois corporation
By: /s/ XXX XXXXX By: /s/ XXXXXX X. XXXXXX
---------------------------------- ----------------------------------
Its: Manager Its: Chief Operating Officer
---------------------------------- ----------------------------------
Date: 3/31/99 Date: 3/31/99
---------------------------------- ----------------------------------
13
EXHIBIT "A"
SITE PLAN
XXXXXXXXX XXXXXXXX XXXX
0000 XXXXXXXXX 15,600 SQ. FT.
1902 LAFAYETTE 16,560 SQ. FT.
1920 LAFAYETTE 19,200 SQ. FT.
1940 LAFAYETTE 14,040 SQ. FT.
PROJECT TOTAL 65,400 SQ. FT.
[GRAPHIC]
14
EXHIBIT D
LANDLORD'S IMPROVEMENTS
Tenant to accept the Premises in its "as-is" condition.
15
EXHIBIT C
SIGN CRITERIA
All signage at the Premises shall be at Tenant's cost and subject to Landlord's
prior approval and shall be consistent with the existing signage at the Project.
16
EXHIBIT D
SURRENDER CONDITION
[FLOORPLAN]
17
LEASE RIDER
1. BASE MONTHLY RENT INCREASES. Base Monthly Rent shall be subject to
increases as follows:
A. Base Monthly Rent shall be subject to adjustment on the anniversary
of each Lease Year ("the Adjustment Date") as follows: the base for computing
the adjustment is the Consumer Price Index for All Urban Consumers (base year
1982-84-100) for San Francisco-Oakland-San Xxxx All Items published by the
United States Department of Labor, Bureau of Labor Statistics ("Index"), which
is most recently published prior to the Commencement Date ("Beginning Index").
If the Index most recently published prior to the Adjustment Date ("Extension
Index") has increased over the Beginning Index, the Base Monthly Rent for the
following year shall be set by multiplying the Initial Base Monthly Rent by a
fraction, the numerator of which is the Extension Index, and the denominator of
which is the Beginning Index. In no case shall the Base Monthly Rent Increase
less than three percent (3%) or more than eight percent (8%) on each Adjustment
Date. The term "Lease Year" shall mean the twelve month period beginning with
the first day of the month in which the Commencement Date occurs and each
successive twelve month period thereafter during the Lease Term.
B. If the Index is changed so that the base year differs from that used
for the Beginning Index, the Index shall be converted in accordance with the
conversion factor published by the United States Department of Labor, Bureau of
Labor Statistics. If the Index is discontinued or revised during the term, such
other government index or computation with which it is replaced shall be used
in order to obtain substantially the same result as would be obtained if the
Index had not been discontinued or revised. Rent adjustments made hereunder
shall be final and binding on Landlord and Tenant.
2. SURRENDER CONDITION. At the expiration or earlier termination of the
Lease, Landlord shall have the option of requiring Tenant to return the
Premises to its original configuration and improvements, substantially as the
Premises existed prior to Tenant's occupancy. If Landlord requests, Tenants
obligations shall include, without limitation, the following:
i) Floor plan shall be as shown on Exhibit D;
ii) All areas of the Premises to be served by roof mounted HVAC as existed
prior to Tenant's occupancy;
iii) All offices to have standard electrical outlets and lighting serviced
only to that space from the house panel as existed prior to Tenant's occupancy;
and
iv) All areas to be carpeted with standard office grade carpeting as
existed prior to Tenant's occupancy. Exhibit D shows in more detail what exists
at the Premises as of the Commencement Date.
3. SECURITY DEPOSIT. Tenant shall provide Landlord with a Security Deposit
equal to the sum of $100,000.00 and the Return Cost. As used herein, the term
"Return Cost" shall mean the cost of restoring the Premises as a result of
Tenant's Alterations in excess of $50,000.00. The Return Cost shall be
established by an estimate provided by a contractor selected by Landlord and
reasonably approved by Tenant. If at anytime the Return Cost increases for any
reason, including without limitation, Tenants future improvements in the
Premises the Security Deposit shall be increased. Tenant may provide the
Security Deposit by posting a letter of credit in the amount of the Security
Deposit in favor of Landlord. Such letter of credit shall be in a form
reasonably acceptable to Landlord and shall include, without limitation, the
following: i) payable on demand by Landlord; ii) not terminable without at
least 30 days prior written notice to Landlord, and iii) Landlord may demand
payment of the letter of credit if it is not renewed at least 30 days prior to
expiration.
4. UNITS 206, 208. Attached hereto as Exhibit E is the existing lease for
Units 206 and 208 which are part of the Premises ("206, 208 Lease"). Tenant
acknowledges that the 206, 208 Lease is currently in effect and Tenant accepts
the Premises subject to such Lease. Tenant shall allow the tenant under the 206,
208 Lease to continue to utilize its premises as set forth in the 206, 208
Lease. Landlord shall use reasonable efforts to obtain possession of the
Premises affected by the 206, 208 Lease as quickly as possible. Landlord agrees
not to extent or renew the 206, 208 Lease beyond its present expiration date.
Tenant's Base Monthly Rent and Common Operating Expenses and Real Property
Taxes shall xxxxx as to the portion of the Premises affected by the 206, 208
Lease until such time as Landlord delivers that portion of the Premises
affected by the 206, 208 Lease to Tenant.
5. CROSS-DEFAULT. A default by Tenant under any lease at Lafayette Business
Park between Landlord and Tenant shall be considered a default under this Lease
and Landlord shall have all rights and remedies provided in the Lease for
Tenant's default.
6. ROOF RIGHTS, CONDUIT. Landlord maintain ownership of the following at the
Project: i) the roof and ability to lease space on the roof of the Premises and
ii) all conduit located outside the Premises. Notwithstanding the above, Tenant
shall have the right to utilize existing conduit at the Project to bring
fiberoptic cable to the Premises without change for the Lease Term, including
any extension or renewal thereof. Tenant shall have the right at its sole cost
and expense, to install and maintain to and from the Premises through horizontal
and vertical shafts, chases, floors and other areas within the Building.
Tenant's cabling, conduits and other connecting equipment (collectively
"Connecting Equipment"), to the extent such Connecting Equipment does not
unreasonably interfere with the operation of the Building. Landlord agrees to
provide Tenant with reasonable advance written notice prior to any construction
occurring in space immediately adjacent to the Premises. Landlord shall have
the right to review and approve the location of all said Connecting Equipment,
which approval will not be unreasonably withheld, conditioned or delayed.
Tenant shall be entitled to such access without charge for the term of this
Lease including any extensions and renewals thereof. In addition, Landlord
shall permit Tenant to receive such telephone and other data communications
services direct from any telecommunications service provider serving the area
at Tenant's cost and shall permit Tenant access to the Building telephone riser
cable and all other telephone or communications cables or wiring, junction
boxes, wire conduits and associated facilities and equipment serving the
Premises, to the point of connection to Tenant's communication equipment and
all telephone and communications closets in the Building without charge for the
term of this Lease, including any extensions and renewals thereof.
7. FUTURE DEVELOPMENT. Tenant acknowledges that Landlord may convert all or a
portion of the Project to telecommunications use. Landlord shall have the right
to connect into and through the Premises to accommodate future development so
long as such actions do not disturb or disrupt Tenant's business operations.
Landlord and Tenant shall act reasonable and in good faith to allow Landlord,
if they so elect, to develop the Project for telecommunications use.
8. CASH CONSIDERATION. As Additional Rent (in addition to all other amounts
due under the Lease), Tenant shall pay Landlord $400,000.00 in eight (8) equal
payments of $50,000.00 payable in the same manner as Base Monthly Rent
commencing April 1, 1999 and monthly thereafter until all eight (8) payments
are made.
9. EQUIPMENT. Landlord shall transfer title and ownership of the following
equipment ("Tenant's Equipment") to Tenant on the Commencement Date:
18
i) 15 ton Xxxxxxx XX unit Located in Room 106;
ii) 15 ton Xxxxxxx XX unit Located in Room 107;
iii) 5 ton Xxxxxxx XX unit Located in Room 103;
iv) 5 ton Xxxxxxx XX unit Located in Room 105;
v) Liebert 225k VA UPS located in Xxxx 000;
vi) Two Liebert UPS Battery Backups located in Room 105;
vii) 250k VA backup generator located behind the Premises;
viii) NOC Console and all equipment and software currently in place located in
Room 202; and
ix) all currently existing cabling infrastructure and cross connect panels.
All other fixtures and equipment in the premises as of the Commencement Date
shall remain the property of Landlord. Notwithstanding the above, the following
shall apply to Tenant's Equipment: (i) if the Lease is terminated due to an
Event of Tenant's Default, Landlord may purchase Tenant's Equipment for the
lesser of fair market value or $100,000; (ii) at the expiration of the Lease
Term, Landlord may purchase Tenant's Equipment for $1; (iii) Landlord shall
have first priority lien rights in Tenant's Equipment; and (iv) Tenant shall
not remove Tenant's Equipment from the Premises without Landlord's consent
which Landlord may withhold in its sole discretion.
10. CONSENT APPROVAL. Wherever the consent or approval of Landlord is required
under the Lease, Landlord agrees not to unreasonably withhold, delay or
condition such approval.
11. QUIET ENJOYMENT. Upon payment by Tenant of the rent for the Premises and
the performance of all the covenants, conditions and provisions on Tenant's
part to be performed under this Lease. Tenant shall have and enjoy quiet
possession of the Premises and all other rights granted to Tenant under the
Lease for the entire Lease Term (including any extensions or renewals) subject
to all of the provisions of this Lease.
19
EXHIBIT E
206, 208 LEASE
20
FIRST AMENDMENT TO LEASE
This First Amendment to Lease ("Amendment") is entered into as of August 21,
1997, between Lafayette Business Park, LLC ("Lessor") and Net Images, Inc. a
California corporation ("Lessee") to amend that certain Lease ("Lease") between
Lessor and Lessee dated February 24, 1999, for premises commonly known as 0000
Xxxxxxxxx Xxxxxx, Xxxxx 000, Xxxxx Xxxxx, Xxxxxxxxxx.
WHEREAS, the parties hereto desire to amend the Lease to, among other things,
add Xxxxx 000 to the Premises, extend the Term of the Lease, and increase the
Base Rent, all commencing as of November 15, 1997.
NOW THEREFORE, the parties hereto agree to amend the Lease as follows:
1. PREMISES: Effective as of November 15, 1997, Paragraph 1.2 of the Lease
shall be deleted and replaced with the following:
"1.2 Premises: Suite Numbers 206 and 208 consisting of approximately 1,222
rentable square feet, more or less, as defined in Paragraph 2 and as shown
on Exhibit "A" hereto (the "Premises")."
2. TERM: Effective as of November 15, 1997, Paragraph 1.5 of the Lease shall
be deleted and replaced with the following:
"1.5 Term: 36.5 months commencing November 15, 1997 ("Commencement Date")
and ending November 30, 2000, as defined in paragraph 3."
3. BASE RENT: Effective as of November 15, 1997, Paragraph 1.6 of the Lease
shall be deleted and replaced with the following:
"1.6 BASE RENT: $1,960.00 per month, payable on the first day of each
month, per Paragraph 4.1, increasing to $2,060.00 per month on December 1,
1998 through November 30, 1999; and $2,160.00 per month on December 1,
1999 through November 30, 2000."
4. SECURITY DEPOSIT: Effective as of November 15, 1997, the Security Deposit
in Paragraph 1.9 shall be changed to $2,160.00.
5. LESSEE'S SHARE: Effective as of November 15, 1997, Lessee's Share of
Operating Expense Increase in Paragraph 1.10 shall be changed to 8.26%.
6. VEHICLE PARKING: Effective as of November 15, 1997, Lessee shall be
entitled to the use of a total of five (5) non-exclusive parking spaces in
the Office Building Project as set forth in Paragraph 2.2.
1
21
7. IMPROVEMENTS: Prior to November 15, 1997, Landlord shall perform the
following improvements at its cost, provided that if the cost of such
improvements exceeds $2,500.00 Tenant shall be responsible for any amount
in excess of $2,500.00;
a) Remove the wall dividing Suites 206 and 208 as shown on Exhibit II
hereto; and
b) Install new carpet in Suite 206 as shown on Exhibit B hereto.
Except as set forth above, Tenant agrees to accept the Premises in its
"as-is" condition.
This Amendment entered into as of the date written above.
LANDLORD TENANT
LAFAYETTE BUSINESS PARK, LLC NET IMAGES, INC.
By: /s/ XXX XXXXX By: /s/ XXXXX X. LE
------------------------------- ------------------------------------
Xxx Xxxxx Xxxxx X. Le
----------------------------------- ----------------------------------------
Printed Name Printed Name
Title: Manager Title: President
---------------------------- ---------------------------------
Date: 9/26/97 Date: 9/22/97
----------------------------- ----------------------------------
2
22
STANDARD OFFICE LEASE
FLOOR PLAN
[FLOOR PLAN]
0000 XXXXXXXXX XXXXXX
SECOND FLOOR
EXHIBIT A
23
STANDARD OFFICE LEASE
FLOOR PLAN
[FLOOR PLAN]
0000 XXXXXXXXX XXXXXX
SECOND FLOOR
EXHIBIT B
24
STANDARD OFFICE LEASE--GROSS
AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION
[LOGO]
1. BASIC LEASE PROVISIONS ("BASIC LEASE PROVISIONS")
1.1 PARTIES: This Lease dated for reference purposes only February 24, 1997,
is made by and between Lafayette Business Park, L.L.C., (herein called "Lessor")
and Net Images, Inc., a California corporation, doing business under the name of
Net Images, Inc., a California corporation, (herein called "Lessee").
1.2 PREMISES: Suite Number(s) 208 floors, consisting of approximately 795
feet, more or less as defined in paragraph 2 and as shown on Exhibit "A" hereto
(the "Premises").
1.3 BUILDING: Commonly described as being located at 0000 Xxxxxxxxx Xxxxxx,
in the City of Santa Xxxxx, County of Santa Xxxxx, State of California, as more
particularly described in Exhibit A hereto and as defined in paragraph 2.
1.4 USE: General Office, subject to paragraph 8.
1.5 TERM: 36.5 months commencing March 15, 1997 ("Commencement Date") and
ending March 31, 2000 as defined in paragraph 3.
1.6 BASE RENT: $1,169.00 per month, payable on the 1st day of each month,
per paragraph 4.1.
1.7 BASE RENT INCREASE: On April 1, 1998 the monthly Base Rent payable under
paragraph 1.6 above shall be adjusted as provided in paragraph 50 below.
1.8 RENT PAID UPON EXECUTION: $1,169.00 for March 15 -- April 14, 1997.
1.9 SECURITY DEPOSIT: $1,240.00.
1.10 LESSER'S SHARE OF OPERATING EXPENSE INCREASE: 5.37% as defined in
paragraph 4.2.
2. PREMISES, PARKING AND COMMON AREAS.
2.1 PREMISES: The Premises are a portion of a building herein sometimes
referred to as the "Building" identified in paragraph 1.3 of the Basic Lease
Provisions. "Building" shall include adjacent parking structures used in
connection therewith. The Premises, the Building, the Common Areas, the land
upon which the same are located, along with all other buildings and improvements
thereon or thereunder are herein collectively referred to as the "Office
Building Project." Lessor hereby leases to Lessee and Lessee and Lessee leases
from Lessor for the term, at the rental, and upon all of the conditions set
forth herein, the real property referred to in the Basic Lease Provisions
paragraph 1.2, as the "Premises," including rights to the Common Areas as
hereinafter specified.
2.2 VEHICLE PARKING: So long as Lessee is not in default, and subject to the
rules and regulations attached hereto, and as established by Lessor from time
to time, Lessee shall be entitled to rent and use 3 parking spaces in the
Office Building Project at the monthly rate applicable from time to time for
monthly parking as set by Lessor and/or its licenses.
2.2.1 If Lessee commits, permits or allows any of the prohibited
activities described in the Lease or the rules then in effect, then Lessor
shall have the right, without notice, in addition to such other rights and
remedies that it may have, to remove or tow away the vehicle involved and
charge the cost to Lessee, which cost shall be immediately payable upon demand
by Lessor.
2.2.2 The monthly parking rate per parking space will be $-0- per
month at the commencement of the term of this Lease, and is subject to change
upon five (5) days prior written notice to Lessee. Monthly parking fees shall
be payable one month in advance prior to the first day of each calendar month.
2.3 COMMON AREAS--DEFINITION. The term "Common Area" is defined as all areas
and facilities outside the Premises and within the exterior boundary line of the
Office Building Project that are provided and designated by the Lessor from time
to time for the general non-exclusive use of Lessor, Lessee and of other lessees
of the Office Building Project and their respective employees, suppliers,
shippers, customers and invitees, including but not limited to common entrances,
lobbies, corridors, stairways and stairwells, public restrooms, elevators,
escalators, parking areas to the extent not otherwise prohibited by this Lease,
loading and unloading areas, trash areas, roadways, sidewalks, walkways,
parkways, ramps, driveways, landscaped areas and decorative walks.
2.4 COMMON AREAS--RULES AND REGULATIONS. Lessee agrees to abide by and
conform to the rules and regulations attached hereto as Exhibit B with respect
to the Office Building Project and Common Areas and to cause its employees,
suppliers, shippers, customers, and invitees to so abide and conform. Lessor or
such other person(s) as Lessor may appoint shall have the exclusive control and
management of the Common Areas and shall have the right, from time to time, to
modify, amend and enforce said rules and regulations. Lessor shall not be
responsible to Lessee for the non-compliance with said rules and regulations by
other lessee, their agents, employees and invitees of the Office Building
Project.
2.5 COMMON AREAS--CHANGES. Lessor shall have the right in Lessor's sole
discretion, from time to time:
(a) To make changes to the Building interior and exterior and Common
Areas, including, without limitation, changes in the location, size, shape,
number, and appearance thereof, including but not limited to the lobbies,
windows, stairways, air shafts, elevators, escalators, restrooms, driveways,
entrances, parking spaces, parking areas, loading and unloading areas, ingress,
egress, direction of traffic, decorative walls, landscaped areas and walkways;
provided, however, Lessor shall at all times provide the parking facilities
required by applicable law;
(b) To close temporarily any of the Common Areas for maintenance
purposes so long as reasonable access to the Premises remains available;
(c) To designate other land and improvements outside the boundaries of
the Office Building Project to be a part of the Common Areas, provided that such
other land and improvements have a reasonable and functional relationship to the
Office Building Project;
(d) To add additional buildings and improvements to the Common Areas;
(e) To use the Common Areas while engaged in making additional
improvements, repairs or alterations to the Office Building Project, or any
portion thereof;
(f) To do and perform such other acts and make such other changes in,
to or with respect to the Common Areas and Office Building Project as Lessor may
in the exercise of sound business judgement deem to be appropriate.
3. TERM.
3.1 TERM. The term and Commencement Date of this Lease shall be as
specified in paragraph 1.5 of the Basic Lease Provisions.
3.2 DELAY IN POSSESSION. Notwithstanding said Commencement Date, if for any
reason Lessor cannot deliver possession of the Premises to Lessee on said date
and subject to paragraph 3.2.2, Lessor shall not be subject to any liability
therefor, nor shall such failure affect the validity of this Lease or the
obligation of Lessee hereunder or extend the term hereof; but, in such case,
Lessee shall not be obligated to pay rent or perform any other obligation of
Lessee under the terms of this Lease, except as may be otherwise provided in
this Lease, until possession of the Premises is tendered to Lessee, as
hereinafter defined; provided, however, that if Lessor shall not have delivered
possession of the Premises with sixty (60) days following said Commencement
Date, as the same may be extended under the terms of a Work Letter executed by
Lessor and Lessee, Lessee ??? Lessee's
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option by notice in writing to Lessor within ten (10) days thereafter, cancel
this Lease, in which event the parties shall be discharged from all obligations
hereunder; provided, however, that as to Lessee's obligations, Lessee first
reimburses Lessor for all costs incurred for Non-Standard Improvements and, as
to Lessor's obligations, Lessor shall return any money previously deposited by
Lessee (less any offsets due Lessor for Non-Standard Improvements); and provided
further, that if such written notice by Lessee is not received by Lessor within
said ten (10) day period, Lessee's right to cancel this Lease hereunder shall
terminate and be of no further force or effect.
3.2.1 POSSESSION TENDERED - DEFINED. Possession of the Premises shall
be deemed tendered to Lessee ("Tender of Possession") when (1) the improvements
to be provided by Lessor under this Lease are substantially completed, (2) the
Building utilities are ready for use in the Premises, (3) Lessee has reasonable
access to the Premises, and (4) ten (10) days shall have expired following
advance written notice to Lessee of the occurrence of the matters described in
(1), (2) and (3) above of this paragraph 3.2.1.
3.2.2 DELAYS CAUSED BY LESSEE. There shall be no abatement of rent,
and the sixty (60) day period following the Commencement Date before which
Lessee's right to cancel this Lease accrues under paragraph 3.2, shall be
deemed extended to the extent of any delays caused by acts or omissions of
Lessee, Lessee's agents, employees and contractors.
3.3 EARLY POSSESSION. If Lessee occupies the Premises prior to said
Commencement Date, such occupancy shall be subject to all provisions of this
Lease, such occupancy shall not change the termination date, and Lessee shall
pay rent for such occupancy.
3.4 UNCERTAIN COMMENCEMENT. In the event commencement of the Lease
term is defined as the completion of the improvements, Lessee and Lessor shall
execute an amendment to this Lease establishing the date of Tender of
Possession (as defined in paragraph 3.2.1) or the actual taking of possession
by Lessee, whichever first occurs, as the Commencement Date.
4. RENT.
4.1 BASE RENT. Subject to adjustment as hereinafter provided in
paragraph 4.3, and except as may be otherwise expressly provided in this Lease,
Lessee shall pay to Lessor the Base Rent for the Premises set forth in paragraph
1.6 of the Basic Lease Provisions, without offset or deduction. Lessee shall
pay Lessor upon execution hereof the advance Base Rent described in paragraph
1.6 of the Basic Lease Provisions. Rent for any period during the term hereof
which is for less than one month shall be prorated based upon the actual number
of days of the calendar month involved. Rent shall be payable in lawful money
of the United States to Lessor at the address stated herein or to such other
persons or at such other places as Lessor may designate in writing.
4.2 OPERATING EXPENSE INCREASE. Lessee shall pay to Lessor during
the term hereof, in addition to the Base Rent, Lessee's Share, as hereinafter
defined, of the amount by which all Operating Expenses, as hereinafter defined,
for each Comparison Year exceeds the amount of all Operating Expenses for the
Base Year, such excess being hereinafter referred to as the "Operating Expense
Increase." In accordance with the following provisions:
(a) "Lessee's Share" is defined, for purposes of this Lease, as
the percentage set forth in paragraph 1.10 of the Basic Lease Provisions, which
percentage has been determined by dividing the approximate square footage of
the Premises by the total approximate square footage of the rentable space
contained in the Office Building Project. It is understood and agreed that the
square footage figures set forth in the Basic Lease Provisions are
approximations which Lessor and Lessee agree are reasonable and shall not be
subject to revision except in connection with an actual change in the size of
the Premises or a change in the space available for lease in the Office
Building Project.
(b) "Base Year" is defined as 1998.
(c) "Comparison Year" is defined as each calendar year during
the term of this Lease subsequent to the Base Year; provided, however, Lessee
shall have no obligation to pay a share of the Operating Expense Increase
applicable to the first twelve (12) months of the Lease Term (other than such as
are mandated by a governmental authority, as to which government mandated
expenses Lessee shall pay Lessee's Share, notwithstanding they occur during the
first twelve (12) months). Lessee's Share of the Operating Expense Increase for
the first and last Comparison Years of the Lease Term shall be prorated
according to that portion of such Comparison Year as to which Lessee is
responsible for a share of such Increase.
(d) "Operating Expenses" is defined, for purposes of this
Lease, to include all costs, if any, incurred by Lessor in the exercise of its
reasonable discretion for:
(1) The operation, repair, maintenance, and replacement, in
neat, clean, safe, good order and condition, of the Office Building Project,
including but not limited to, the following:
(aa) The Common Areas, including their surfaces, coverings,
decorative items, carpets, drapes and window coverings, and including parking
areas, loading and unloading areas, trash areas, roadways, sidewalks, walkways,
stairways, parkways, driveways, landscaped areas, striping, bumpers, irrigation
systems, Common Area lighting facilities, building exteriors and roofs, fences
and gates;
(bb) All heating, air conditioning, plumbing, electrical
systems, life safety equipment, telecommunication and other equipment used in
common by, or for the benefit of lessees or occupants of the Office Building
Project, including elevators and escalators, tenant directories, fire detection
systems including sprinkler system maintenance and repair.
(ii) Trash disposal, janitorial and security services;
(iii) Any other service to be provided by Lessor that is
elsewhere in this Lease stated to be an "Operating Expense";
(iv) The cost of the premiums for the liability and property
insurance policies to be maintained by Lessor under paragraph 5 hereof;
(v) The amount of the real property taxes to be paid by Lessor
under paragraph 10.1 hereof;
(vi) The cost of water, sewer, gas, electricity, and other
publicly mandated services to the Office Building Project;
(vii) Labor, salaries and applicable fringe benefits and costs,
materials, supplies and tools used in maintaining and/or cleaning the Office
Building Project and accounting and a management fee attributable to the
operation of the Office Building Project;
(viii) Replacing and/or adding improvements mandated by any
governmental agency and any repairs or removals necessitated thereby amortized
over its useful life according to Federal Income tax regulation or guidelines
for depreciation thereof (including interest on the unamortized balance as is
then reasonable in the judgment of Lessor's accountants);
(ix) Replacements of equipment or improvements that have a
useful life for depreciation purposes according to Federal Income tax
guidelines of five (5) years or less, as amortized over such life.
(e) Operating Expenses shall not include the costs of replacements
of equipment or improvements that have a useful life for Federal Income tax
purposes in excess of five (5) years unless it is of the type described in
paragraph 4.2(d)(viii), in which case their cost shall be included as above
provided.
(f) Operating Expenses shall not include any expenses paid by any
lessee directly to third parties, or as to which Lessor is otherwise reimbursed
by any third party, other tenant, or by insurance proceeds.
(g) Lessee's Share of Operating Expenses increase shall be payable by
Lessee within ten (10) days after a reasonably detailed statement of actual
expenses is presented to Lessee by Lessor. At Lessor's option, however, an
amount may be estimated by Lessor from time to time in advance of Lessee's Share
of the Operating Expenses Increase for any Comparison Year, and the same shall
be payable monthly or quarterly, as Lessor shall designate, during each
Comparison Year of the Lease term, on the same day as the Base Rent is due
hereunder. In the event that Lessee pays Lessor's estimate of Lessee's Share of
Operating Expense Increase as aforesaid, Lessor shall deliver to Lessee within
sixty (60) days after the expiration of each Comparison Year a reasonably
detailed statement showing Lessee's Share of the actual Operating Expense
Increase incurred during such year. If Lessee's payments under this paragraph
4.2(g) during said Comparison Year exceed Lessee's Share as indicated on said
statement, Lessee shall be entitled to credit the amount of such overpayment
against Lessee's Share of Operating Expense Increase next falling due. If
Lessee's payments under this paragraph during said Comparison Year were less
than Lessee's Share as indicated on said statement, Lessee shall pay to Lessor
the amount of the deficiency within ten (10) days after delivery by Lessor to
Lessee of said statement. Lessor and Lessee shall forthwith adjust between them
by cash payment any balance determined to exist with respect to that portion of
the last Comparison Year for which Lessee is responsible as to Operating Expense
Increases, notwithstanding that the Lease term may have terminated before the
end of such Comparison Year.
4.3 RENT INCREASE.
4.3.1 At the times set forth in paragraph 1.7 of the Basic Lease
Provisions, the monthly Base Rent payable under paragraph 4.1 of this Lease
shall be adjusted by the increase, if any, in the Consumer Price Index of the
Bureau of Labor Statistics of the Department of Labor for All Urban Consumers,
(1967-100). "All items," for the city nearest the location of the Building,
herein referred to as "C.P.I." since the date of this Lease.
4.3.2 The monthly Base Rent payable pursuant to paragraph 4.3.1
shall be calculated as follows: the Base Rent payable for the first month of
the term of this Lease, as set forth in paragraph 4.1 of this Lease, shall be
multiplied by a fraction the numerator of which shall be the C,P.I. of the
calendar month during which the adjustment is to take effect, and the
denominator of which shall be the C.P.I. for the calendar month in which the
original Lease term commences. The sum so calculated shall constitute the new
monthly Base Rent hereunder, but, in no event, shall such new monthly Base Rent
be less than the Base Rent payable for the month immediately preceding the date
for the rent adjustment.
4.3.3 In the event the compilation and/or publication of the
C.P.I. shall be transferred to any other governmental department or bureau or
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agency or shall be discontinued, then the index most nearly the same as the
C.P.I. shall be used to make such calculations. In the event that Lessor and
Lessee cannot agree on such alternative index, then the matter shall be
submitted for decision to the American Arbitration Association in the County in
which the Premises are located, in accordance with the then rules of said
association and the decision of the arbitrators shall be binding upon the
parties, notwithstanding one party failing to appear after due notice of the
proceeding. The cost of said Arbitrators shall be paid equally by Lessor and
Lessee.
4.3.4. Lessee shall continue to pay the rent at the rate previously in
effect until the increase, if any, is determined. Within five (5) days
following the date on which the increase is determined, Lessee shall make such
payment to Lessor as will bring the increased rental current, commencing with
the effective date of such increase through the date of any rental instalments
then due. Thereafter the rental shall be paid at the increased rate.
4.3.5 At such time as the amount of any change in rental required by this
Lease is known or determined, Lessor and Lessee shall execute an amendment to
this Lease setting forth such change.
5. SECURITY DEPOSIT. Lessee shall deposit with Lessor upon execution hereof
the security deposit set forth in paragraph 1.9 of the Basic Lease Provisions
as security for Lessee's faithful performance of Lessee's obligations hereunder.
If Lessee fails to pay rent or other charges due hereunder, or otherwise
defaults with respect to any provision of this Lease, Lessor may use, apply or
retain all or any portion of said deposit for the payment of any rent or other
charge in default for the payment of any other sum to which Lessor may become
obligated by reason of Lessee's default, or to compensate Lessor for any loss
or damage which Lessor may suffer thereby. If Lessor so uses or applies all or
any portion of said deposit, Lessee shall within ten (10) days after written
demand therefor deposit cash with Lessor in an amount sufficient to restore
said deposit to the full amount then required of Lessee. If the monthly Base
Rent shall, from time to time, increase during the term of this Lease, Lessee
shall, at the time of such increase, deposit with Lessor additional money as
security deposit so that the total amount of the security deposit held by
Lessor shall at all times bear the same proportion to the then current Base
Rent as the initial security deposit bears to the Initial Base Rent set forth
in paragraph 1.6 of the Basic Lease Provisions. Lessor shall not be required to
keep said security deposit separate from its general accounts. If Lessee
performs all of Lessee's obligations hereunder, said deposit, or so much
thereof as has not heretofore been applied by Lessor, shall be returned,
without payment of interest or other increment for its use, to Lessee (or, at
Lessor's option, to the last assignee, if any, of Lessee's interest hereunder)
at the expiration of the term hereof and after Lessee has vacated the Premises.
No trust relationship is created herein between Lessor and Lessee with respect
to said Security Deposit.
6. USE
6.1 USE. The Premises shall be used and occupied only for the purpose set
forth in paragraph 1.4 of the Basic Lease Provisions or any other use which is
reasonably comparable to that use and for no other purpose.
6.2 COMPLIANCE WITH LAW.
(a) Lessor warrants to Lessee that the Premises, in the state
existing on the date that the Lease term commences, but without regard to
alterations or improvements made by Lessee or the use for which Lessee will
occupy the Premises, does not violate any covenants or restrictions of record,
or any applicable building code, regulation or ordinance in effect on such
Lease Term Commencement Date. In the event it is determined that this warranty
has been violated, then it shall be the obligation of the Lessor, after written
notice from Lessee, to promptly, at Lessor's sole cost and expense, rectify any
such violation.
(b) Except as provided in paragraph 6.2(a) Lessee shall, at Lessee's
expense, promptly comply with all applicable statutes, ordinances, rules,
regulations, orders, covenants and restrictions of record, and requirements of
any fire insurance underwriters or rating bureaus, now in effect or which may
hereafter come into effect, whether or not they reflect a change in policy from
that now existing, during the term or any part of the term hereof, relating in
any manner to the Premises and the occupation and use by Lessee of the Premises.
Lessee shall conduct its business in a lawful manner and shall not use or
permit the use of the Premises or the Common Areas in any manner that will tend
to create waste or a nuisance or shall tend to disturb other occupants of the
Office Building Project.
6.3 CONDITION OF PREMISES.
(a) Lessor shall deliver the Premises to Lessee in a clean condition
on the Lease Commencement Date (unless Lessee is already in possession) and
Lessor warrants to Lessee that the plumbing, lighting, air conditioning, and
heating system in the Premises shall be in good operating condition. In the
event that it is determined that this warranty has been violated, then it shall
be the obligation of Lessor, after receipt of written notice from Lessee
setting forth with specificity the nature of the violation, to promptly, at
Lessor's sole cost, rectify such violation.
(b) Except as otherwise provided in this Lease, Lessee hereby accepts
the Premises and the Office Building Project in their condition existing as of
the Lease Commencement Date or the date that Lessee takes possession of the
Premises, whichever is earlier, subject to all applicable zoning, municipal,
county and state laws, ordinances and regulations governing and regulating the
use of the Premises, and any easements, covenants or restrictions of record, and
accepts this Lease subject thereto and to all matters disclosed thereby and by
any exhibits attached hereto. Lessor acknowledges that it has satisfied itself
by its own independent investigation that the Premises are suitable for its
intended use, and that neither Lessor nor Lessor's agent or agents has made any
representation or warranty as to the present or future suitability of the
Premises, Common Areas, or Office Building Project for the conduct of Lessee's
business.
7. MAINTENANCE, REPAIRS, ALTERATIONS AND COMMON AREA SERVICES.
7.1 LESSOR'S OBLIGATIONS. Lessor shall keep the Office Building Project,
including the Premises, interior and exterior walls, roof, and common areas,
and the equipment whether used exclusively for the Premises or in common with
other premises, in good condition and repair; provided, however, Lessor shall
not be obligated to paint, repair or replace wall coverings, or to repair or
replace any improvements that are not ordinarily a part of the Building or are
above then Building standards. Except as provided in paragraph ???, there shall
be no abatement of rent or liability of Lessee on account of any injury or
interference with Lessee's business with respect to any improvements,
alterations or repairs made by Lessor to the Office Building Project or any
part thereof. Lessee expressly waives the benefits of any statute now or
hereafter in effect which would otherwise afford Lessee the right to make
repairs at Lessor's expense or to terminate this Lease because of Lessor's
failure to keep the Premises in good order, condition and repair.
7.2 LESSEE'S OBLIGATIONS.
(a) Notwithstanding Lessor's obligation to keep the Premises in good
condition and repair, Lessee shall be responsible for payment of the cost
thereof to Lessor as additional rent for that portion of the cost of any
maintenance and repair of the Premises, or any equipment (wherever located)
that serves only Lessee or the Premises, to the extent such cost is
attributable to causes beyond normal wear and tear. Lessee shall be responsible
for the cost of painting, repairing or replacing wall coverings, and to repair
or replace any Premises improvements that are not ordinarily a part of the
Building or that are above then Building standards. Lessor may, at its option,
upon reasonable notice, elect to have Lessee perform any particular such
maintenance or repairs the cost of which is otherwise Lessee's responsibility
hereunder.
(b) On the last day of the term hereof, or on any sooner termination,
Lessee shall surrender the Premises to Lessor in the same condition as
received, ordinary wear and tear excepted, clean and free of debris. Any damage
or deterioration of the Premises shall not be deemed ordinary wear and tear if
the same could have been prevented by good maintenance practices by Lessee.
Lessee shall repair any damage to the Premises occasioned by the installation or
removal of Lessee's trade fixtures, alterations, furnishings and equipment.
Except as otherwise stated in this Lease, Lessee shall leave the air lines,
power panels, electrical distribution systems, lighting fixtures, air
conditioning, window coverings, wall coverings, carpets, wall panelling,
ceilings and plumbing on the Premises and in good operating condition.
7.3 ALTERATIONS AND ADDITIONS.
(a) Lessee shall not, without Lessor's prior written consent make any
alterations, improvements, additions, Utility Installations or repairs in, on or
about the Premises, or the Office Building Project. As used in this paragraph
7.3 the term "Utility Installation" shall mean carpeting, window and wall
coverings, power panels, electrical distribution systems, lighting fixtures, air
conditioning, plumbing, and telephone and telecommunication wiring and
equipment. At the expiration of the term, Lessor may require the removal of any
or all of said alterations, improvements, additions or Utility Installations,
and the restoration of the Premises and the Office Building Project to their
prior condition, at Lessee's expense. Should Lessor permit Lessee to make its
own alterations, improvements, additions or Utility Installations, Lessee shall
use only such contractor as has been expressly approved by Lessor, and Lessor
may require Lessee to provide Lessor, at Lessee's sole cost and expense, a lien
and completion bond in an amount equal to one and one-half times the estimated
cost of such improvements, to insure Lessor against any liability for mechanic's
and materialmen's liens and to insure completion of the work. Should Lessee make
any alterations, improvements, additions or Utility Installations without the
prior approval of Lessor, or use a contractor not expressly approved by Lessor,
Lessor may, at any time during the term of this Lease, require that Lessee
remove any part or all of the same.
(b) Any alterations, improvements, additions or Utility Installations
in or about the Premises or the Office Building Project that Lessee shall
desire to make shall be presented to Lessor in written form, with proposed
detailed plans. If Lessor shall give its consent to Lessee's making such
alteration, improvement, addition or Utility Installation, the consent shall be
deemed conditioned upon Lessee acquiring a permit to do so from the applicable
governmental agencies, furnishing a copy thereto to Lessor prior to the
commencement of the work, and compliance by Lessee with all conditions of said
permit in a prompt and expeditious manner.
(c) Lessee shall pay, when due, all claims for labor or materials
furnished or alleged to have been furnished to or for Lessee at or for use in
the Premises, which claims are or may be secured by any mechanic's or
materialmen's lien against the Premises, the Building or the Office Building
Project, or any interest therein.
(D) Lessee shall give Lessor not less than ten (10) days' notice
prior to the commencement of any work in the Premises by Lessee, and Lessor
shall have the right to post notice of non-responsibility in or on the Premises
or the Building as provided by law. If Lessee shall, in good faith, contest the
validity of any such lien, claim or demand, then Lessee shall, at its sole
expense defend itself and Lessor against the same and shall pay and satisfy
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any such adverse judgment that may be rendered thereon before the enforcement
thereof against the Lessor or the Premises, the Building or the Office Building
Project, upon the condition that if Lessor shall require, Lessee shall furnish
to Lessor a surety bond satisfactory to Lessor in an amount equal to such
contested lien claim or demand indemnifying Lessor against liability for the
same and holding the Premises, the Building and the Office Building Project free
from the effect of such lien or claim. In addition, Lessor may require Lessee to
pay Lessor's reasonable attorneys' fees and costs in participating in such
action if Lessor shall decide it is to Lessor's best interest so to do.
(e) All alterations, improvements, additions and Utility Installations
(whether or not such Utility Installations constitute trade fixtures of Lessee),
which may be made to the Premises by Lessee, including but not limited to, floor
coverings, panelings, doors, drapes, built-ins, moldings, sound ??,
and lighting and telephone or communication systems, conduit, wiring and
outlets, shall be made and done in a good and workmanlike manner and of good and
sufficient quality and materials and shall be the property of Lessor and remain
upon and be surrendered with the Premises at the expiration of the Lease term,
unless Lessor requires their removal pursuant to paragraph 7.3(e). Provided
Lessee is not in default, notwithstanding the provisions of this paragraph
7.3(e). Lessee's personal property and equipment, other than that which is
affixed to the Premises so that it cannot be removed without material damage to
the Premises or the Building, and other than Utility Installations, shall remain
the property of Lessee and may be removed by Lessee subject to the provisions of
paragraph 7.2.
(f) Lessee shall provide Lessor with as-built plans and specifications
for any alterations, improvements, additions or Utility Installations.
7.4 UTILITY ADDITIONS. Lessor reserves the right to install new or
additional utility facilities throughout the Office Building Project for the
benefit of Lessor or Lessee, or any other leases of the Office Building Project,
including, but not by way of limitation, such utilities as plumbing, electrical
systems, communication system, and fire protection and detection systems, so
long as such installations do not unreasonably interfere with Lessee's use of
the Premises.
8. INSURANCE; INDEMNITY.
8.1 LIABILITY INSURANCE -- LESSEE. Lessee shall at Lessee's expense, obtain
and keep in force during the term of this Lease a policy of Comprehensive
General Liability Insurance utilizing an Insurance Services Office standard form
with Broad Form General Liability Endorsement (GL0404), or equivalent, in an
amount of not less than $1,000,000 per occurrence of bodily injury and property
damage combined or in a greater amount as reasonably determined by Lessor and
shall insure Lessee with Lessor as an additional insured against liability
arising out of the use, occupancy or maintenance of the Premises. Compliance
with the above requirement shall not, however, limit the liability of Lessee
hereunder.
8.2 LIABILITY INSURANCE -- LESSOR. Lessor shall obtain and keep in force
during the term of this Lease a policy of Combined Single Limit Bodily Injury
and Broad Form Property Damage Insurance, plus coverage against such other risks
Lessor deems advisable from time to time, insuring Lessor, but not Lessee,
against liability arising out of the ownership, use, occupancy or maintenance of
the Office Building Project in an amount not less than $5,000,000.00 per
occurrence.
8.3 PROPERTY INSURANCE -- LESSEE. Lessee shall, at Lessee's expense, obtain
and keep in force during the term of this Lease for the benefit of Lessee,
replacement cost fire and extended coverage insurance, with vandalism and
malicious mischief, sprinkler leakage and earthquake sprinkler leakage
endorsements, in an amount sufficient to cover not less than 100% of the full
replacement cost, as the same may exist from time to time, of all of Lessee's
personal property, fixtures, equipment and tenant improvements.
8.4 PROPERTY INSURANCE -- LESSOR. Lessor shall obtain and keep in force
during the term of this Lease a policy or policies of insurance covering loss or
damage to the Office Building Project improvements, but not Lessee's personal
property, fixtures, equipment or tenant improvements, in the amount of the full
replacement cost thereof, as the same may exist from time to time, utilizing
Insurance Services Office standard form, or equivalent, providing protection
against all perils included within the classification of fire, extended
coverage, vandalism, malicious mischief, plate glass, and such other perils as
Lessor deems advisable or may be required by a lender having a lien on the
Office Building Project. In addition, Lessor shall obtain and keep in force
during the term of this Lease, a policy of rental value insurance covering a
period of one year, with loss payable to Lessor, which Insurance shall also
cover all Operating Expenses for said period. Lessee will not be named in any
such policies carried by Lessor and shall have no right to any proceeds
therefrom. The policies required by these paragraphs 8.2 and 8.4 shall contain
such deductibles as Lessor or the aforesaid lender may determine. In the event
that the Premises shall suffer an insured loss as defined in paragraph 8.1(f)
hereof, the deductible amounts under the applicable insurance policies shall be
deemed an Operating Expense. Lessee shall not do or permit to be done anything
which shall invalidate the insurance policies carried by Lessor. Lessee shall
pay the entirety of any increase in the property insurance premium for the
Office Building Project over what it was immediately prior to the commencement
of the term of this Lease if the increase is specified by Lessor's insurance
carrier as being caused by the nature of Lessee's occupancy or any act or
omission of Lessee.
8.5 INSURANCE POLICIES. Lessee shall deliver to Lessor copies of liability
insurance policies required under paragraph 8.1 or certificates evidencing the
existence and amounts of such insurance within seven (7) days after the
Commencement Date of this Lease. No such policy shall be cancellable or subject
to reduction of coverage or other 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 renewals thereof.
8.6 WAIVER OF SUBROGATION. Lessee and Lessor each hereby release and
relieve the other, and waive their entire right of recovery against the other,
for direct or consequential loss or damage arising out of or incident to the
perils covered by property insurance carried by such party, whether due to the
negligence of Lessor or Lessee of their agents, employees, contractors and/or
invitees. If necessary all property insurance policies required under this Lease
shall be endorsed to so provide.
8.7 INDEMNITY. Lessee shall indemnify and hold harmless Lessor and its
agents. Lessor's master or ground lessor, partners and lenders, from and against
any and all claims for damage to the person or property of anyone or any entity
arising from Lessee's use of the Office Building Project, or from the conduct of
Lessee's business or from any activity, work or things done, permitted or
suffered by Lessee in or about the Premises or elsewhere and shall further
indemnify and hold harmless Lessor from and against any and all claims, costs
and expenses arising from any breach or default in the performance of any
obligation on Lessee's part to be performed under the terms of this Lease, or
arising from any act or omission of Lessee, or any of Lessee's agents,
contractors, employees, or invitees, and from and against all costs, attorney's
fees, expenses and liabilities incurred by Lessor as the result of any such use,
conduct, activity, work, things done, permitted or suffered, breach, default or
negligence, and in dealing reasonably therewith, including but not limited to
the defense or pursuit of any claim or any action or proceeding involved
therein; and in case any action or proceeding be brought against Lessor by
reason of any such matter, Lessee upon notice from Lessor shall defend the same
at Lessee's expense by counsel reasonably satisfactory to Lessor and Lessor
shall cooperate with Lessee in such defense. Lessor need not have first paid any
such claim in order to be so indemnified. Lessee, as a material part of the
consideration to Lessor, hereby assumes all risk of damage to property of Lessee
or injury to persons, in, upon or about the Office Building Project arising from
any cause and Lessee hereby waives all claims in respect thereof against Lessor.
8.8 EXEMPTION OF LESSOR FROM LIABILITY. Lessee hereby agrees that Lessor
shall not be liable for injury to Lessee's business or any loss of income
therefrom or for loss of or damage to the goods, wares, merchandise or other
property of Lessee, Lessee's employees, invitees, customers, or any other person
in or about the Premises or the Office Building Project, nor shall Lessor be
liable for injury to the person of Lessee, Lessee's employees, agents or
contractors, whether such damage or injury is caused by or results from theft,
fire, seam, electricity, gas, water or rain, or from the breakage, leakage,
obstruction or other defects of pipes, sprinklers, wires, appliances, plumbing,
air conditioning or lighting fixtures, or from any other cause, whether said
damage or injury results from conditions arising upon the Premises or upon other
portions of the Office Building Project, or from other sources or places, or
from new construction or the repair, alteration or improvement of any part of
the Office Building Project, or of the equipment, fixtures or appurtenances
applicable thereto, and regardless of whether the cause of such damage or injury
or the means of repairing the same is inaccessible, Lessor shall not be liable
for any damages arising from any act or neglect of any other lessee, occupant or
user of the Office Building Project, nor from the failure of Lessor to enforce
the provisions of any other lease of any other lessee of the Office Building
Project.
8.9 NO REPRESENTATION OF ADEQUATE COVERAGE. Lessor makes no representation
that the limits or forms of coverage of insurance specified in this paragraph 8
are adequate to cover Lessee's property or obligations under this Lease.
9. DAMAGE OR DESTRUCTION.
9.1 DEFINITIONS.
(a) "Premises Damage" shall mean if the Premises are damaged or
destroyed to any extent.
(b) "Premises Building Partial Damage" shall mean if the Building of
which the Premises are a part is damaged or destroyed to the extent that the
cost to repair is less than fifty percent (50%) of the then Replacement Cost of
the building.
(c) "Premises Building Total Destruction" shall mean if the Building of
which the Premises are a part is damaged or destroyed to the extent that the
cost to repair is fifty percent (50%) or more of the then Replacement Cost of
the Building.
(d) "Office Building Project Buildings" shall mean all of the
buildings on the Office Building Project site.
(e) "Office Building Project Buildings Total Destruction" shall mean if
the Office Building Project Buildings are damaged or destroyed to the extent
that the cost of repair is fifty percent (50%) or more of the then Replacement
Cost of the Office Building Project Buildings.
(f) "Insured Loss" shall mean damage or destruction which was caused by
an event required to be covered by the insurance described in paragraph 8. The
fact that an insured Loss has a deductible amount shall not make the loss an
uninsured loss.
(g) "Replacement Cost" shall mean the amount of money necessary to be
spent in order to repair or rebuild the damaged area to the condition that
existed immediately prior to the damage occurring, excluding all improvements
made by lessees, other than those installed by Lessor at Lessee's expenses.
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9.2 PREMISES DAMAGE: PREMISES BUILDING PARTIAL DAMAGE.
(a) Insured Loss: Subject to the provisions of paragraphs 9.4 and
9.5, if at any time during the term of this Lease there is damage which is an
insured Loss and which falls into the classification of either Premises Damage
or Premises Building Partial Damage, then Lessor shall, as soon as reasonably
possible and to the extent the required materials and labor are readily
available through usual commercial channels, at Lessor's expense, repair such
damage (but not Lessee's fixtures, equipment or tenant improvements originally
paid for by Lessee) to its condition existing at the time of the damage, and
this Lease shall continue in full force and effect.
(b) Uninsured Loss: Subject to the provisions of paragraphs 9.4 and
9.5, if at any time during the term of this Lease there is damage which is not
an insured Loss and which falls within the classification of Premises Damage or
Premises Building Partial Damage, unless caused by a negligent or willful act
of Lessee (in which event Lessee shall make the repairs at Lessee's expense),
which damage prevents Lessee from making any substantial use of the Premises,
Lessor may at Lessor's option either (i) repair such damage as soon as
reasonably possible at Lessor's expense, in which event this Lease shall
continue in full force and effect, or (ii) give written notice to Lessee within
thirty (30) days after the date of the occurrence of such damage of Lessor's
intention to cancel and terminate this Lease as of the date of the occurrence of
such damage, in which event this Lease shall terminate as of the date of the
occurrence of such damage.
9.3 PREMISES BUILDING TOTAL DESTRUCTION; OFFICE BUILDING PROJECT TOTAL
DESTRUCTION. Subject to the provisions of paragraphs 9.4 and 9.5, if at any time
during the term of this Lease there is damage, whether or not it is an insured
Loss, which falls into the classifications of either (i) Premises Building
Total Destruction, or (ii) Office Building Project Total Destruction, then
Lessor may at Lessor's option either (i) repair such damage or destruction as
soon as reasonably possible at Lessor's expense (to the extent the required
materials are readily available through usual commercial channels) to its
condition existing at the time of the damage, but not Lessee's fixtures,
equipment or tenant improvements, and this Lease shall continue in full force
and effect, or (ii) give written notice to Lessee within thirty (30) days after
the date of occurrence of such damage of Lessor's intention to cancel and
terminate this Lease, in which case this Lease shall terminate as of the date
of the occurrence of such damage.
9.4 DAMAGE NEAR END OF TERM.
(a) Subject to paragraph 9.4(b), if at any time during the last
twelve (12) months of the term of this Lease there is substantial damage to the
Premises, Lessor may at Lessor's option cancel and terminate this Lease as of
the date of occurrence of such damage by giving written notice to Lessee of
Lessor's election to do so within 30 days after the date of occurrence of such
damage.
(b) Notwithstanding paragraph 9.4(a), in the event that Lessee has an
option to extend or renew this Lease, and the time within which said option may
be exercised has not yet expired, Lessee shall exercise such option, if it is to
be exercised at all, no later than twenty (20) days after the occurrence of an
insured Loss falling within the classification of Premises Damage during the
last twelve (12) months of the term of this Lease. If Lessee duly exercises
such option during said twenty (20) day period, Lessor shall at Lessor's
expense, repair such damage, but not Lessee's fixtures, equipment or tenant
improvements, as soon as reasonably possible and this Lease shall continue in
full force and effect. If Lessee fails to exercise such option during said
twenty (20) day period, then Lessor may at Lessor's option terminate and cancel
this Lease as of the expiration of said twenty (20) day period by giving
written notice to Lessee of Lessor's election to do so within ten (10) days
after the expiration of said twenty (20) day period, notwithstanding any term
or provision in the grant of option to the contrary.
9.5 ABATEMENT OF RENT; LESSEE'S REMEDIES.
(a) In the event Lessor repairs or restores the Building or Premises
pursuant to the provisions of this paragraph 9, and any part of the Premises
are not usable (including loss of use due to loss of access or essential
services), the rent payable hereunder (including Lessee's Share of Operating
Expense Increases) for the period during which such damage, repair or
restoration continues shall be abated, provided (1) the damage was not the
result of the negligence of the Lessee, and (2) such abatement shall only be to
the extent the operation and profitability of Lessee's business as operated
from the Premises is adversely affected. Except for said abatement of rent, if
any, Lessee shall have no claim against Lessor for any damage suffered by
reason of any such damage, destruction, repair or restoration.
(b) If Lessor shall be obligated to repair or restore the Premises
or the Building under the provisions of this Paragraph 9 and shall not commence
such repair or restoration within ninety (90) days after such occurrence, or if
Lessor shall not complete the restoration and repair within six (6) months
after such occurrence, Lessee may at Lessee's option cancel and terminate this
Lease by giving Lessor written notice of Lessee's election to do so at any time
prior to the commencement or completion, respectively, of such repair or
restoration. In such event this Lease shall terminate as of the date of such
notice.
(c) Lessee agrees to cooperate with Lessor in connection with any
such restoration and repair, including but not limited to the approval and/or
execution of plans and specifications required.
9.6. TERMINATION - ADVANCE PAYMENTS. Upon termination of this Lease
pursuant to this paragraph 9, an equitable adjustment shall be made concerning
advance rent and any advance payments made by Lessee to Lessor. Lessor shall,
in addition, return to Lessee so much of Lessee's security deposit as has not
theretofore been applied by Lessor.
9.7 WAIVER. Lessor and Lessee waive the provisions of any statute which
relate to termination of leases when leased property is destroyed and agree that
such event shall be governed by the terms of this Lease.
10. REAL PROPERTY TAXES.
10.1 PAYMENT OF TAXES. Lessor shall pay the real property tax, as defined
in paragraph 10.3, applicable to the Office Building Project subject to
reimbursement by Lessee of Lessee's Share of such taxes in accordance with the
provisions of paragraph 4.2, except as otherwise provided in paragraph 10.2.
10.2 ADDITIONAL IMPROVEMENTS. Lessee shall not be responsible for paying
any increase in real property tax specified in the tax assessor's records and
work sheets as being caused by additional improvements placed upon the Office
Building Project by other lessees or by Lessor for the exclusive enjoyment of
any other lessee. Lessee shall, however, pay to Lessor at the time that
Operating Expenses are payable under paragraph 4.2(c) the entirety of any
increase in real property tax if assessed solely by reason of additional
improvements placed upon the Premises by Lessee or at Lessee's request.
10.3 DEFINITION OF "REAL PROPERTY TAX." As used herein, the term "real
property tax" shall include any form of real estate tax or assessment, general,
special, ordinary or extraordinary, and any license fee, commercial rental tax,
improvement bond or bonds, levy or tax (other than inheritance, personal income
or estate taxes) imposed on the Office Building Project or any portion thereof
by any authority having the direct or indirect power to tax, including any city,
county, state or federal government, or any school, agricultural, sanitary,
fire, street, drainage or other improvement district thereof, as against any
legal or equitable interest of Lessor in the Office Building Project or in any
portion thereof, as against Lessor's right to rent or other income therefrom,
and as against Lessor's business of leasing the Office Building Project. The
term "real property tax" shall also include any tax, fee, levy, assessment or
charge (i) in substitution of, partially or totally, any tax, fee, levy,
assessment or charge hereinabove included within the definition of "real
property tax," or (ii) the nature of which was hereinbefore included within the
definition of "real property tax," or (iii) which is imposed for a service or
right not charged prior to June 1, 1978, or, if previously charged, has been
increased since June 1, 1978, or (iv) which is imposed as a result of a change
in ownership, as defined by applicable local statutes for property tax purposes,
of the Office Building Project or which is added to a tax or charge herein
before included within the definition of real property tax by reason of such
change of ownership, or (v) which is imposed by reason of this transaction, any
modification or changes hereto, or any transfers hereof.
10.4 JOINT ASSESSMENT. If the improvements or property, the taxes for
which are to be paid separately by Lessee under paragraph 10.2 or 10.5 are not
separately assessed, Lessee's portion of that tax shall be equitably determined
by Lessor from the respective valuations assigned in the assessor's worksheets
or such other information (which may include the cost of construction) as may
be reasonably available. Lessor's reasonable determination thereof, in good
faith, shall be conclusive.
10.5 PERSONAL PROPERTY TAXES.
(a) Lessee shall pay prior to delinquency all taxes assessed against
and levied upon trade fixtures, furnishings, equipment and all other personal
property of Lessee contained in the Premises or elsewhere.
(b) If any of Lessee's said personal property shall be assessed with
Lessor's real property, Lessee shall pay to Lessor the taxes attributable to
Lessee within ten (10) days after receipt of a written statement setting forth
the taxes applicable to Lessee's property.
11. UTILITIES.
11.1 SERVICES PROVIDED BY LESSOR. Lessor shall provide heating,
ventilation, air conditioning, and janitorial service as reasonably required,
reasonable amounts of electricity for normal lighting and office machines, water
for reasonable and normal drinking and lavatory use, and replacement light bulbs
and/or fluorescent tubes and ballasts for standard overhead fixtures.
11.2 SERVICE EXCLUSIVE TO LESSEE. Lessee shall pay for all water, gas,
heat, light, power, telephone and other utilities and services specially or
exclusively supplied and/or metered exclusively to the Premises or to Lessee,
together with any taxes thereon. If any such services are not separately metered
to the Premises, Lessee shall pay at Lessor's option, either Lessee's Share or
a reasonable proportion to be determined by Lessor of all charges jointly
metered with other premises in the Building.
11.3 HOURS OF SERVICE. Said services and utilities shall be provided
during generally accepted business days and hours or such other days or hours
as may hereafter be set forth. Utilities and services required at other times
shall be subject to advance request and reimbursement by Lessee to Lessor of the
cost thereof.
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29
(d) The failure by Lessee to observe or perform any of the covenants,
conditions or provisions of this Lease to be observed or performed by Lessee
other than those referenced in subparagraphs (b) and (c), above, where such
failure shall continue for a period of thirty (30) days after written notice
thereof from Lessor to Lessee; provided, however, that the nature of Lessee's
noncompliance is such that more than thirty (30) days are reasonably required
for its cure, then Lessee shall not be deemed to be in default if Lessee
commenced such cure within said thirty (30) day period and thereafter diligently
pursues such cure to completion. To the extent permitted by law, such thirty
(30) day notice shall constitute the sole and exclusive notice required to be
given to Lessee under applicable Unlawful Detainer statutes.
(e)(i) The making by Lessee of any general arrangement or general
assignment for the benefit of creditors; (ii) Lessee becoming a "debtor" as
defined in 11 U.S.C. Section 101 or any successor statute thereto (unless, in
the case of a petition filed against Lessee, the same is dismissed within sixty
(60) days; (iii) the appointment of a trustee or receiver to take possession of
substantially all of Lessee's assets located at the Premises or at Lessee's
interest in this Lease, where possession is not restored to Lessee within thirty
(30) days; or (iv) the attachment, execution or other judicial seizure of
substantially all of Lessee's assets located at the Premises or of Lessee's
interest in this Lease, where such seizure is not discharged within thirty (30)
days. In the event that any provision of this paragraph 13.1(c) is contrary to
any applicable law, such provision shall be of no force or effect.
(f) The discovery by Lessor that any financial statement given to Lessor
by Lessee, or its successor in interest or by any guarantor of Lessee's
obligation hereunder, was materially false.
13.2 REMEDIES. In the event of any material default or breach of this Lease
by Lessee, Lessor may at any time thereafter, with or without notice or demand
and without limiting Lessor in the exercise of any right or remedy which Lessor
may have by reason of such default:
(a) Terminate Lessee's right to possession of the Premises by any lawful
means, in which case this Lease and the term hereof shall terminate and Lessee
shall immediately surrender possession of the Premises to Lessor in such event
Lessor shall be entitled to recover from Lessee all damages incurred by Lessor
by reason of Lessee's default including, but not limited to, the cost of
recovering possession of the Premisses; expenses of reletting, including
necessary renovation and alteration of the Premises, reasonable attorneys' fees,
and any real estate commission actually paid; the worth of the time of award by
the court having jurisdiction hereof of the amount by which the unpaid rent for
the balance of the term after the time of such award exceeds the amount of such
rental loss for the same period that Lessee proves could be reasonably avoided;
that portion of the leasing commission paid by Lessor pursuant to paragraph 16
applicable to the unexpired term of this Lease.
(b) Maintain Lessee's right to possession in which case this Lease shall
continue in effect whether or not Lessee shall have vacated or abandoned the
Premises. In such event Lessor shall be entitled to enforce all of Lessor's
rights and remedies under this Lease, including the right to recover the rent as
it becomes due hereunder.
(c) Pursue any other remedy now or hereafter available to Lessor under
the laws or judicial decisions of the state wherein the Premises are located.
Unpaid installments of rent and other unpaid monetary obligations of Lessee
under the terms of this Lease shall bear interest from the date due at the
maximum rate then allowable by law.
13.3 DEFAULT BY LESSOR. Lessor shall not be in default unless Lessor fails
to perform obligations required of Lessor within a reasonable time, but in no
event later than thirty (30) days after written notice by Lessee to Lessor and
to the holder of any first mortgage or deed of trust covering the Premises whose
name and address shall have theretofore been furnished to Lessee in writing,
specifying wherein Lessor has failed to perform such obligation; provided,
however, that if the nature of Lessor's obligation is such that more than thirty
(30) days are required for performance than Lessor shall not be in default if
Lessor commences performance within such 30 day period and thereafter diligently
pursues the same to completion.
13.4 LATE CHARGES. Lessee hereby acknowledges that late payment by Lessee to
Lessor of Base Rent, Lessee's Share of Operating Expense increases or other sums
due hereunder will cause Lessor to incur costs not contemplated by this Lease,
the exact amount of which will be extremely difficult to ascertain. Such costs
include, but are not limited to, processing and accounting charges, and late
charges which may be imposed on Lessor by the terms of any mortgage or trust
deed covering the Office Building Project. Accordingly, if any installment of
Base Rent, Operating Expense Increase, or any other sum due from Lessee shall
not be received by Lessor or Lessor's designee within ten (10) days after such
amount shall be due, then, without any requirement for notice to Lessee, Lessee
shall pay to Lessor a late charge equal to 6% of such overdue amount. The
parties hereby agree that such late charge represents a fair and reasonable
estimate of the costs Lessor will incur by reason of late payment by Lessee.
Acceptance of such late charge by Lessor shall in no event constitute a waiver
of Lessee's default with respect to such overdue amount, nor prevent Lessor from
exercising any of the other rights and remedies granted hereunder.
14. CONDEMNATION. If the Premises or any portion thereof or the Office Building
Project are taken under the power of eminent domain, or sold under the threat of
the exercise of said power (all of which are herein called "condemnation"), this
Lease shall terminate as to the part so taken as of the date the condemning
authority takes title or possession, whichever first occurs; provided that if so
much of the Premises or the Office Building Project are taken by such
condemnation as would substantially and adversely affect the operation and
profitability of Lessee's business conducted from the Premises, Lessee shall
have the option, to be exercised only in writing within thirty (30) days after
Lessor shall have given Lessee written notice of such taking (or in the absence
of such notice, within thirty (30) days after the condemning authority shall
have taken possession), to terminate this Lease as of the date the condemning
authority takes such possession. If Lessee does not terminate this Lease in
accordance with the foregoing, this Lease shall remain in full force and effect
as to the portion of the Premises remaining, except that the rent and Lessee's
Share of Operating Expense Increase shall be reduced in the proportion that the
floor area of the Premises taken bears to the total floor area of the Premises.
Common Areas taken shall be excluded from the Common Areas usable by Lessee and
no reduction of rent shall occur with respect thereto or by reason thereof.
Lessor shall have the option in its sole discretion to terminate this Lease as
of the taking of possession by the condemning authority, by giving written
notice to Lessee of such election within thirty (30) days after receipt of
notice of a taking by condemnation of any part of the Premises or the Office
Building Project. Any award for the taking of all or any part of the Premises or
the Office Building Project under the power of eminent domain or any payment
made under threat of the exercise of such power shall be the property of Lessor,
whether such award shall be made as compensation for diminution in value of the
leasehold or for the taking of the fee, or as severance damages; provided,
however, that Lessee shall be entitled to any separate award for loss of or
damage to Lessee's trade fixtures, removable personal property and unamortized
tenant improvements that have been paid for by Lessee. For that purpose the cost
of such improvements shall be amortized over the original term of this Lease
excluding any options. In the event that this Lease is not terminated by reason
of such condemnation, Lessor shall to the extent of severance damages received
by Lessor in connection with such condemnation, repair any damage to the
Premises caused by such condemnation except to the extent that Lessee has been
reimbursed therefor by the condemning authority Lessee shall pay any amount in
excess of such severance damages required to complete such repair.
15. BROKER'S FEE.
(a) The brokers involved in this transaction are ___________________________
as "listing broker" and ____________________________________________ as
"cooperating broker," licensed real estate broker(s). A "cooperating broker" is
defined as any broker other than the listing broker entitled to a share of any
commission arising under this Lease. Upon execution of this Lease by both
parties, Lessor shall pay to said brokers jointly, or in such separate shares as
they may mutually designate in writing, a fee as set forth in a separate
agreement between Lessor and said broker(s), or in the event there is no
separate agreement between Lessor and said broker(s), the sum of
$______________, for brokerage services rendered by said broker(s) to Lessor in
this transaction.
(b) Lessor further agrees that (i) if Lessee exercises any Option, as
defined in paragraph 39.1 of this Lease, which is granted to Lessee under this
Lease, or any subsequently granted option which is substantially similar to an
Option granted to Lessee under this Lease, or (ii) if Lessee acquires any rights
to the Premises or other premises described in this Lease which are
substantially similar to what Lessee would have acquired had an Option herein
granted to Lessee been exercised, or (iii) if Lessee remains in possession of
the Premises after the expiration of the term of this Lease after having failed
to exercise an Option, or (iv) if said broker(s) are the procuring cause of any
other lease or sale entered into between the parties pertaining to the Premises
and/or any adjacent property in which Lessor has an interest, or (v) if the Base
Rent is increased, whether by agreement or operation of an escalation clause
contained herein, then as to any of said transactions or rent increases, Lessor
shall pay said broker(s) a fee in accordance with the schedule of said broker(s)
in effect at the time of execution of this Lease. Said fee shall be paid at the
time such increased rental is determined.
(c) Lessor agrees to pay said fee not only on behalf of Lessor but also on
behalf of any person, corporation, association, or other entity having an
ownership interest in said real property or any part thereof, when such fee is
due hereunder. Any transferee of Lessor's interest in this Lease, whether such
transfer is by agreement or by operation of law, shall be deemed to have assumed
Lessor's obligation under this paragraph 15. Each listing and cooperating broker
shall be a third party beneficiary of the provisions of this paragraph 15 to the
extent of their interest in any commission arising under this Lease and may
enforce that right directly against Lessor; provided however, that all brokers
having a right to any part of such total commission shall be a necessary party
to any suit with respect thereto.
(d) Lessee and Lessor each represent and warrant to the other that neither
has had any dealings with any person, firm, broker or finder (other that the
person(s), if any, whose names are set forth in paragraph 15(e), above) in
connection with the negotiation of this Lease and/or consummation of the
transaction contemplated hereby, and no other broker or other person, firm or
entity is entitled to any commission or finder's fee in connection with said
transaction and Lessee and Lessor do each hereby indemnify and hold the other
harmless from and against any costs, expenses, attorneys' fees or liability for
compensation or charges which may be claimed by any such unnamed broker, finder
or other similar party by reason of any dealings or actions of the indemnifying
party.
16. ESTOPPEL CERTIFICATE
(a) Each party (as "responding party") shall at any time upon not less than
ten (10) days' prior written notice from the other party ("requesting party")
execute, acknowledge and deliver to the requesting party a statement in writing
(i) certifying that this Lease is unmodified and in full force and effect (or,
if modified, stating the nature of such modification and certifying that this
Lease, as so modified, is in full force and effect) and the date
FULL SERVICE--GROSS
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to which the rent and other charges are paid in advance, if any, and (ii)
acknowledging that there are not, to the responding party's knowledge, any
uncured defaults on the part of the requesting party, or specifying such
defaults if any are claimed. Any such statement may be conclusively relied upon
by any prospective purchaser or encumbrancer of the Office Building Project or
of the business of Lessee.
(b) At the requesting party's option, the failure to deliver such statement
within such time shall be a material default of this Lease by the party who is
to respond, without any further notice to such party, or it shall be conclusive
upon such party that (i) this Lease is in full force and effect, without
modification except as may be represented by the requesting party, (ii) there
are no uncured defaults in the requesting party's performance, and (iii) if
Lessor is the requesting party, not more than one month's rent has been paid in
advance.
(c) If Lessor desires to finance, refinance, or sell the Office Building
Project, or any part thereof, Lessee hereby agrees to deliver to any lender or
purchaser designated by Lessor such financial statements of Lessee as may be
reasonably required by such lender or purchaser. Such statements shall include
the past three (3) years' financial statements of Lessee. All such financial
statements shall be received by Lessor and such lender or purchaser in
confidence and shall be used only for the purposes herein set forth.
17. LESSOR'S LIABILITY. The term "Lessor" as used herein shall mean only the
owner or owners, of the time in question, of the fee title or a lessee's
interest in a ground lease of the Office Building Project, and except as a
expressly provided in paragraph 15, in the event of any transfer of such title
or interest, Lessor herein named (and in case of any subsequent transfers then
the grantor) shall be relieved from and after the date of such transfer of all
liability as respects Lessor's obligations thereafter to be performed, provided
that any funds in the hands of Lessor or the then grantor at the time of such
transfer, in which Lessee has an interest, shall be delivered to the grantee.
The obligations contained in this Lease to be performed by Lessor shall, subject
as aforesaid, be binding on Lessor's successors and assigns, only during their
respective periods of ownership.
18. SEVERABILITY. The invalidity of any provision of this Lease as determined
by a court of competent jurisdiction shall in no way affect the validity of any
other provision hereof.
19. INTEREST ON PAST-DUE OBLIGATIONS. Except as expressly herein provided, any
amount due to Lessor not paid when due shall bear interest at the maximum rate
then allowable by law or judgments from the date due. Payment of such interest
shall not excuse or cure any default by Lessee under this Lease; provided,
however, that interest shall not be payable on late charges incurred by Lessee
nor on any amounts upon which late charges are paid by Lessee.
20. TIME OF ESSENCE. Time is of the essence with respect to the obligations to
be performed under this Lease.
21. ADDITIONAL RENT. All monetary obligations of Lessee to Lessor under the
terms of this Lease, including but not limited to Lessee's Share of Operating
Expense increase and any other expenses payable by Lessee hereunder shall be
deemed to be rent.
22. INCORPORATION OF PRIOR AGREEMENTS; AMENDMENTS. This Lease contains all
agreements of the parties with respect to any matter mentioned herein. No prior
or contemporaneous agreement or understanding pertaining to any such matter
shall be affective. This Lease may be modified in writing only, signed by the
parties in interest at the time of the modification. Except as otherwise stated
in this Lease, Lessee hereby acknowledges that neither the real estate broker
noted in paragraph 15 hereof nor any cooperating broker on this transaction nor
the Lessor or any employee or agents of any of the said persons has made any
oral or written warranties or representations to Lessee relative to the
condition or use by Lessee of the Premises or the Office Building Project and
Lessee acknowledges that Lessee assumes all responsibility regarding the
Occupational Safety Health Act, the legal use and adaptability of the Premises
and the compliance thereof with all applicable laws and regulations in affect
during the term of this Lease.
23. NOTICES. Any notice required or permitted to be given hereunder shall be in
writing and may be given by personal delivery or by certified or registered
mail, and shall be deemed sufficiently given it delivered or addressed to Lessee
or to Lessor at the address noted below or adjacent to the signature of the
respective parties, as the case may be. Mailed notices shall be deemed given
upon actual receipt at the address required, or forty-eight hours following
deposit in the mail, postage prepaid, whichever first occurs. Either party may
by notice to the other specify a different address for notice purposes except
that upon Lessee's taking possession of the Premises, the Premises shall
constitute Lessee's address for notice purposes. A copy of all notices required
or permitted to be given to Lessor hereunder shall be concurrently transmitted
to such party or parties at such addresses as Lessor may from time to time
hereafter designate by notice to Lessee.
24. WAIVERS. No waiver by Lessor of any provision hereof shall be deemed a
waiver of any other provision hereof or of any subsequent breach by Lessee of
the same or any other provision. Lessor's consent to or approval of, any act
shall not be deemed to render unnecessary the obtaining of Lessor's consent to
or approval of any subsequent act by Lessee. The acceptance of rent hereunder by
Lessor shall not be a waiver of any preceding breach by Lessee of any provision
hereof, other than the failure of Lessee to pay the particular rent so accepted,
regardless of Lessor's knowledge of such preceding breach at the time of
acceptance of such rent.
25. RECORDING. Either Lessor or Lessee shall, upon request of the other,
execute, acknowledge and deliver to the other a "short form" memorandum of this
Lease for recording purposes.
26. HOLDING OVER. If Lessee, with Lessor's consent, remains in possession of the
Premises or any part thereof after the expiration of the terms hereof, such
occupancy shall be a tenancy from month to month upon all the provisions of this
Lease pertaining to the obligations of Lessee, except that the rent payable
shall be two hundred percent (200%) of the rent payable immediately preceding
the termination date of this Lease, and all Options, if any, granted under the
terms of this Lease shall be deemed terminated and be of no further effect
during said month to month tenancy.
27. CUMULATIVE REMEDIES. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other remedies
of law or in equity.
28. COVENANTS AND CONDITIONS. Each provision of this Lease performable by Lessee
shall be deemed both a covenant and a condition.
29. BINDING EFFECT; CHOICE OF LAW. Subject to any provisions hereof restricting
assignment or subletting by Lessee and subject to the provisions of paragraph
17, this Lease shall bind the parties, their personal representatives,
successors and assigns. This Lease shall be governed by the laws of the State
where the Office Building Project is located and any litigation concerning this
Lease between the parties hereto shall be initiated in the county in which the
Office Building Project is located.
30. SUBORDINATION.
(a) This Lease, and any Option or right of first refusal granted hereby, at
Lessor's option, shall be subordinate to any ground lease, mortgage, deed of
trust, or any other hypothecation or security now or hereafter placed upon the
Office Building Project and to any and all advances made on the security hereof
and to all renewals, modifications, consolidations, replacements and extensions
thereof. Notwithstanding such subordination, Lessee's right to quiet possession
of the Premises shall not be disturbed if Lessee is not in default and so long
as Lessee shall pay the rent and observe and perform all of the provisions of
this Lease, unless this Lease is otherwise terminated pursuant to its terms. If
any mortgagee, trustee or ground lessor shall elect to have this lease and any
Options granted hereby prior to the lien of its mortgage, deed of trust or
ground lease, and shall give written notice thereof to Lessee, (this Lease and
such Options shall be deemed prior to such mortgage, deed of trust or ground
lease, whether this Lease or such Options are dated prior or subsequent to the
date of said mortgage, deed of trust or ground lease or the date of recording
thereof.
(b) Lessee agrees to execute any documents required to effectuate an
attornment, a subordination, or to make this Lease or any Option granted herein
prior to the lien of any mortgage deed of trust or ground lease, as the case may
be. Lessee's failure to execute such documents within ten (10) days after
written demand shall constitute a material default by Lessee thereunder without
further notice to Lessee or, at Lessor's option, Lessor shall execute such
documents on behalf of Lessee as Lessee's attorney-in-fact. Lessee does hereby
make, constitute and irrevocably appoint Lessor as Lessee's attorney-in-fact and
in Lessee's name, place and stead, to execute such documents in accordance with
this paragraph 30(b).
31.1 ATTORNEY'S FEES.
31.1 If either party or the broker(s) named herein bring an action to
enforce the terms hereof or declare rights hereunder, the prevailing party in
any such action, trial or appeal thereon, shall be entitled to his reasonable
attorney's fees to be paid by the losing party as fixed by the court in the same
or a separate suit, and whether or not such action is pursued to decision or
judgment. The provisions of this paragraph shall inure to the benefit of the
broker named herein who seeks to enforce a right hereunder.
31.2 The attorneys' fee award shall not be computed in accordance with
any court fee schedule, but shall be such as to fully reimburse all attorneys'
fees reasonably incurred in good faith.
31.3 Lessor shall be entitled to reasonable attorneys' fees, and all
other costs and expenses incurred in the preparation and service of notice of
default and consultations in connection therewith, whether or not a legal
transaction is subsequently commenced in connection with such default.
32. LESSOR'S ACCESS.
32.1 Lessor and Lessor's agent shall have the right to enter the
Premises at reasonable times for the purpose of inspecting the same, performing
any services required of Lessor, showing the same to prospective purchasers,
lenders, or lessee, taking such safety measures, erecting such scaffolding or
other necessary structure, making such alterations, repairs, improvements or
additions to the Premises or to the Office Building Project as Lessor may
reasonably deem necessary or desirable and the erecting, using and maintaining
of utilities, services, pipes and conduits through the Premises and/or other
premises as long as there is no material adverse effect to Lessee's use of the
Premises. Lessor may at any time place on or about the Premises or the Building
any ordinary "For Sale" signs and Lessor may at any time during the last 120
days of the term hereof place on or about the Premises any ordinary "For
Lease" signs.
32.2 All activities of Lessor pursuant to this paragraph shall be
without abatement of rent, nor shall Lessor have any liability to Lessee for
the same.
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31
32.3 Lessor shall have the right to retain keys to the Premises and to
unlock all doors in or upon the Premises other than to files, vaults and safes,
and in the case of emergency to enter the Premises by any reasonably appropriate
means, and any such entry shall not be deemed a forceable or unlawful entry or
detainer of the Premises or an eviction. Lessee waives any charges for damages
or injuries or interference with Lessee's property or business in connection
therewith.
33. AUCTIONS. Lessee shall not conduct, nor permit to be conducted, either
voluntarily or involuntarily, any auction upon the Premises or the Common Areas
without first having obtained Lessor's prior written consent. Notwithstanding
anything to the contrary in this Lease, Lessor shall not be obligated to
exercise any standard of reasonableness in determining whether to grant such
consent. The holding of any auction on the Premises or Common Areas in
violation of this paragraph shall constitute a material default of this Lease.
34. SIGNS. Lessee shall not place any sign upon the Premises of the Office
Building Project without Lessor's prior written consent. Under no circumstances
shall Lessee place a sign on any roof of the Office Building Project.
35. MERGER. The voluntary or other surrender of this Lease by Lessee, or a
mutual cancellation thereof, or a termination by Lessor, shall not work a
merger, and shall, at the option of Lessor, terminate all or any existing
subtenancies or may, at the option of Lessor, operate as an assignment to Lessor
of any or all of such subtenancies.
36. CONSENTS. Except For Paragraphs 33 (auctions) and 34 (signs) hereof,
wherever in this Lease the consent of one party is required to an act of the
other party such consent shall not be unreasonably withheld or delayed.
37. GUARANTOR. In the event that there is a guarantor of this Lease, said
guarantor shall have the same obligations as Lessee under this Lease.
38. QUIET POSSESSION. Upon Lessee paying the rent for the Premises and
observing and performing all of the covenants, conditions and provisions on
Lessee's part to be observed and performed hereunder, Lessee shall have quiet
possession of the Premises for the entire term hereof subject to all of the
provisions of this Lease. The individuals executing this Lease on behalf of
Lessor represent and warrant to Lessee that they are fully authorized and
legally capable of executing this Lease on behalf of Lessor and that such
execution is binding upon all parties holding an ownership interest in the
Office Building Project.
39. OPTIONS.
39.1 DEFINITION. As used in this paragraph the word "Option" has the
following meaning: (1) the right or option to extend the term of this Lease or
to renew this Lease or to extend or renew any lease that Lessee has on other
property of Lessor; (2) the option of right of first refusal to lease the
Premises or the right of first offer to lease the Premises or the first refusal
to lease other space within the Office Building Project or other property of
Lessor or the right of first offer to lease other space within the Office
Building Project or other property of Lessor; (3) the right or option to
purchase the Premises or the Office Building Project, or the right of first
refusal to purchase the Premises or the Office Building Project or the right of
first offer to purchase the Premises of the Office Building Project, or the
right or option to purchase other property of Lessor, or the right of first
refusal to purchase other property of Lessor or the right of first offer to
purchase other property of Lessor.
39.2 OPTIONS PERSONAL. Each Option granted to Lessee in this Lease is
personal to the original Lessee and may be exercised only by the original
Lessee while occupying the Premises who does so without the intent of
thereafter assigning this Lease or subletting the Premises or any portion
thereof, and may not be exercised or be assigned, voluntarily or involuntarily
by or to any person or entity other than Lessee; provided, however, that an
Option may be exercised by or assigned to any Lessee ????? as defined in
paragraph 12.2 of this Lease. The Options, if any, herein granted to Lessee are
not assignable separate and apart from this Lease, nor may any Option be
separated from this Lease in any manner, either by reservation or otherwise.
39.3 MULTIPLE OPTIONS. In the event that Lessee has any multiple options to
extend or renew this Lease a later option cannot be exercised unless the prior
option to extend or renew this Lease has been so exercised.
39.4 EFFECT OF DEFAULT ON OPTIONS.
(a) Lessee shall have no right to exercise an Option, notwithstanding
any provision in the grant of Option to the contrary, (i) during the time
commencing from the date Lessor gives to Lessee a notice of default pursuant to
paragraph 13.1(c) or 13.1(d) and continuing until the noncompliance alleged in
said notice of default is cured, or (ii) during the period of time commencing
on the day after a monetary obligation to Lessor is due from Lessee and unpaid
(without any necessity for notice thereof to Lessee) and continuing until the
obligation is paid, or (iii) in the event that Lessor has given to Lessee three
or more notices of default under paragraph 13.1(c), or paragraph 13.1(d),
whether or not the defaults are cured, during the 12 month period of time
immediately prior to the time that Lessee attempts to exercise the subject
Option, (iv) if Lessee has committed any non-curable breach, including without
limitation those described in paragraph 13.1(b), or is otherwise in default of
any of the terms, covenants or conditions of this Lease.
(b) The period of time within which an Option may be exercised shall not
be extended or enlarged by reason of Lessee's inability to exercise an Option
because of the provisions of paragraph 39.4(a).
(c) All rights of Lessee under the provisions of an Option shall
terminate and be of no further force or effect, notwithstanding Lessee's due
and timely exercise of the Option. If, after such exercise and during the term
of this Lease, (i) Lessee fails to pay to Lessor a monetary obligation of Lessee
for a period of thirty (3) days after such obligation becomes due (without any
necessity of Lessor to give notice thereof to Lessee), or (ii) Lessee fails to
commence to cure a default specified in paragraph 13.1(d) within thirty (30)
days after the date that Lessor gives notice to Lessee of such default and/or
Lessee fails thereafter to diligently prosecute said cure to completion, or
(iii) Lessor gives to Lessee three or more notices of default under paragraph
13.1(c), or paragraph 13.1(d), whether or not the defaults are cured, or (iv) if
Lessee has committed any non-curable breach, including without limitation those
described in paragraph 13.1(b), or is otherwise in default of any of the terms,
covenants and conditions of this Lease.
40. SECURITY MEASURES--LESSOR'S RESERVATIONS.
40.1 Lessee hereby acknowledges that Lessor shall have no obligation
whatsoever to provide guard service or other security measures for the benefit
of the Premises or the Office Building Project. Lessee assumes all
responsibility for the projection of Lessee, its agents, and invitees and the
property of Lessee and of Lessee's agents and invitees from acts of third
parties. Nothing herein contained shall prevent Lessor, at Lessor's sole
option, from providing security protection for the Office Building Project or
any part thereof, in which event the cost thereof shall be included within the
definition of Operating Expenses, as set forth in paragraph 4.2(b).
40.2 Lessor shall have the following rights:
(a) To change the name, address or title of the Office Building in
which the Premises are located upon not less than 90 days prior written notice;
(b) To, at Lessee's expense, provide and install Building standard
graphics on the door of the Premises and such portions of the Common Areas as
Lessor shall reasonably deem appropriate;
(c) To permit any lessee the exclusive right to conduct any business
as long as such exclusive does not conflict with any rights expressly given
herein;
(d) To place such signs, notices or displays as Lessor reasonably
deems necessary or advisable upon the roof, exterior of the buildings or the
Office Building Project or on pole signs in the Common Areas;
40.3. Lessee shall not:
(a) Use a representation (photographic or otherwise) of the Building
or the Office Building Project or their name(s) in connection with Lessee's
business;
(b) Suffer or permit anyone, except in emergency, to go upon the roof
of the Building.
41. EASEMENTS.
41.1 Lessor reserves to itself the right, from time to time, to grant such
easements, rights and dedications that Lessor deems necessary or desirable, and
to cause the recordation of Parcel Maps and restrictions, so long as such
easements, rights, dedications, Maps and restrictions do not unreasonably
interfere with the use of the Premises by Lessee. Lessee shall sign any of the
aforementioned documents upon request of Lessor and failure to do so shall
constitute a material default of this Lease by Lessee without the need for
further notice to Lessee.
41.2 The obstruction of Lessee's view, air, or light by any structure
erected in the vicinity of the Building whether by Lessor or third parties,
shall in no way affect this Lease or impose any liability upon Lessor.
42. PERFORMANCE UNDER PROTEST. If at any time a dispute shall arise as to any
amount or sum of money to be paid by one party to the other under the provisions
hereof, the party against whom the obligation to pay the money is asserted shall
have the right to make payment "under protest" and such payment shall not be
regarded as a voluntary payment, and there shall survive the right on the part
of said party to institute suit for recovery of such sum. If it shall be
adjudged that there was no legal obligation on the part of said party to pay
such sum or any part thereof, said party shall be entitled to recover such sum
or so much thereof as it was not legally required to pay under the provisions of
this Lease.
FULL SERVICE--GROSS
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32
43. AUTHORITY. If Lessee is a corporation, [ILLEGIBLE LINE] entity represent and
warrant that such individual is duly authorized to execute and deliver this
Lease on behalf of said [ILLEGIBLE] trust or partnership, Lessee shall, within
thirty (30) days after execution of this Lease, deliver to Lessor evidence of
such authority satisfactory to Lessor.
44. CONFLICT. Any conflict between the printed provisions, [ILLEGIBLE] or
Addenda of this Lease and the typewritten or handwritten provisions, if any,
shall be controlled by the typewritten or handwritten provisions.
45. NO OFFER. Preparation of this Lease by Lessor or Lessor's agent and
submission of same to Lessee shall not be deemed an offer to Lessee to lease.
This Lease shall become binding upon Lessor and Lessee only when fully executed
by both parties.
46. LENDER MODIFICATION. Lessee agrees to make such reasonable modifications to
this Lease as may be reasonably required by an institutional lender in
connection with the obtaining of normal financing or refinancing of the Office
Building Project.
47. MULTIPLE PARTIES. If more than one person or entity is named as either
Lessor or Lessee herein, except as otherwise expressly provided herein, the
obligations of the Lessor or Lessee herein shall be the joint and several
responsibility of all persons or entities named herein as such Lessor or
Lessee, respectively.
48. WORK LETTER. This Lease is supplemented by that certain Work Letter of even
date executed by Lessor and Lessee, attached hereto as Exhibit C, and
incorporated herein by this reference.
49. ATTACHMENTS. Attached hereto are the following documents which constitute a
part of this Lease:
50. RENT: The monthly rental rate shall be as follows:
March 15, 1997 - March 31, 1998 rent shall be $1,169.00 per month
April 1, 1998 - March 31, 1999 rent shall be $1,200.00 per month
April 1, 1999 - March 31, 2000 rent shall be $1,240.00 per month
51. ELECTRICAL, HVAC: Tenant acknowledges that under the terms of the Lease,
Landlord is only to provide to the Premises HVAC five (5) days a week from 8
a.m. to 6 p.m., and electrical power necessary for typical office use. Tenant
agrees to pay all reasonable costs of electricity and/or HVAC in excess of
typical office use, including without limitation, the reasonable cost of: (i)
additional electrical distribution, (ii) depreciation on equipment, (iii)
additional utility charges, and (iv) if necessary, Tenant's share of bringing
additional electrical power to the Office Building.
52. IMPROVEMENTS: Landlord shall complete the work set forth on Exhibit A in
addition to painting, carpeting, and installing ceiling tiles in the suite.
LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
PROVISION CONTAINED HEREIN AND, BY EXECUTION OF THIS LEASE, SHOW THEIR INFORMED
AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE TIME THIS
LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE AND
EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE
PREMISES.
IF THIS LEASE HAS BEEN FILLED IN IT HAS BEEN PREPARED FOR
SUBMISSION TO YOUR ATTORNEY FOR HIS APPROVAL. NO
REPRESENTATION OR RECOMMENDATION IS MADE BY THE AMERICAN
INDUSTRIAL REAL ESTATE ASSOCIATION OR BY THE REAL ESTATE
BROKER OR ITS AGENTS OR EMPLOYEES AS TO THE LEGAL
SUFFICIENCY, LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS LEASE
OR THE TRANSACTION RELATING THERETO; THE PARTIES SHALL RELY
SOLELY UPON THE ADVICE OF THEIR OWN LEGAL COUNSEL AS TO THE
LEGAL AND TAX CONSEQUENCES OF THIS LEASE.
LESSOR LESSEE
Lafayette Business Park, L.L.C. Nat Images, Inc.
------------------------------- -------------------------------------------
By /s/ XXX XXXXX By /s/ XXXXX X. LE
---------------------------- ----------------------------------------
Its Manager Its President
---------------------- ----------------------------------
By By
---------------------------- ----------------------------------------
Its Its
---------------------- ----------------------------------
Executed at Executed at 11:00 am 0000 Xxxxxxxxx Xxxxxx
------------------- -------------------------------
on on 2/27/97
---------------------------- ----------------------------------------
Address Address 0000 Xxxxxxxxx Xxxxxx
----------------------- -----------------------------------
FULL SERVICE - GROSS
PAGE 10 OF 10 PAGES
33
STANDARD OFFICE LEASE
FLOOR PLAN
[FLOOR PLAN]
SECOND FLOOR
EXHIBIT A
FULL SERVICE - GROSS
34
RULES AND REGULATIONS FOR
STANDARD OFFICE LEASE
[LOGO]
Dated: February 24, 1997
By and Between Lafayette Business Park, L.L.C., and Net Images, Inc.
GENERAL RULES
1. Lease shall not suffer or permit the obstruction of any Common Areas,
including driveways, walkways and stairways.
2. Lessor reserves the right to refuse access to any persons Lessor in good
faith judges to be a threat to the safety, reputation or property of the Office
Building Project and its occupants.
3. Lessee shall not make or permit any noise or odors that annoy or
interfere with other lessees or persons having business within the Office
Building Project.
4. Lessee shall not keep animals or birds within the Office Building Project
and shall not bring bicycles, motorcycles or other vehicles into areas not
designated as authorized for same.
5. Lessee shall not make, suffer or permit litter except in appropriate
receptacles for that purpose.
6. Lessee shall not alter any lock or install new or additional locks or
bolts.
7. Lessee shall be responsible for the inappropriate use of any toilet
rooms, plumbing or other utilities. No foreign substances of any kind are to be
inserted therein.
8. Lessee shall not deface the walls, partitions or other surfaces of the
premises or Office Building Project.
9. Lessee shall not suffer or permit anything in or around the Premises or
Building that causes excessive vibration or floor loading in any part of the
Office Building Project.
10. Furniture, significant freight and equipment shall be moved into or out of
the building only with the Lessor's knowledge and consent, and subject to such
reasonable limitations, techniques and timing, as may be designated by Lessor.
Lessee shall be responsible for any damage to the Office Building Project
arising from any such activity.
11. Lessee shall not employ any service or contractor for services or work to
be performed in the Building, except as approved by Lessor.
12. Lessor reserves the right to close and lock the Building on Saturdays,
Sundays and legal holidays, and on other days between the hours of ____P.M and
____A.M. of the following day. If Lessee uses the Premises during such periods,
Lessee shall be responsible for securely locking any doors it may have opened
for entry.
13. Lessee shall return all keys at the termination of its tenancy and shall
be responsible for the cost of replacing any keys that are lost.
14. No window coverings, shades or awnings shall be installed or used by
Lessee.
15. No Lessee, employee or invitee shall go upon the roof of the Building.
16. Lessee shall not suffer or permit smoking or carrying of lighted cigars or
cigarettes in areas reasonably designated by Lessor or by applicable
governmental agencies as non-smoking areas.
17. Lessee shall not use any method of heating or air conditioning other than
as provided by Lessor.
18. Lessee shall not install, maintain or operate any vending machines upon
the Premises without Lessor's written consent.
19. The Premises shall not be used for lodging or manufacturing, cooking or
food preparation.
20. Lessee shall comply with all safety, fire protection and evacuation
regulations established by Lessor or any applicable governmental agency.
21. Lessor reserves the right to waive any one of these rules or regulations,
and/or as to any particular Lessee and any such waiver shall not constitute a
waiver of any other rule or regulation or any subsequent application thereof to
such Lessee.
22. Lessee assumes all risks from theft or vandalism and agrees to keep its
Premises locked as may be required.
23. Lessor reserves the right to make such other reasonable rules and
regulations as it may from time to time deem necessary for the appropriate
operation and safety of the Office Building Project and its occupants. Lessee
agrees to abide by these and such rules and regulations.
PARKING RULES
1. Parking areas shall be used only for parking by vehicles no longer than
full size, passenger automobiles herein called "Permitted Size Vehicles."
2. Lessee shall not permit or allow any vehicles that belong to or are
controlled by Lessee or Lessee's employees, suppliers, shippers, customers, or
invitees to be loaded, unloaded, or parked in areas other than those designated
by Lessor for such activities.
3. Parking stickers or identification devices shall be the property of
Lessor and be returned to Lessor by the holder thereof upon termination of the
holder's parking privileges. Lessee will pay such replacement charge as is
reasonably established by Lessor for the loss of such devices.
4. Lessor reserves the right to refuse the sale of monthly identification
devices to any person or entity that willfully refuses to comply with the
applicable rules, regulations, laws and/or agreements.
5. Lessor reserves the right to relocate all or a part of parking spaces
from floor to floor, within one floor, and/or to reasonably adjacent offsite
location(s), and to reasonably allocate them between compact and standard size
spaces as long as the same complies with applicable laws, ordinances and
regulations.
6. Users of the parking area will obey all posted signs and park only into
the areas designated for vehicle parking.
7. Unless otherwise instructed, every person using the parking area is
required to park and lock his own vehicle. Lessor will not be responsible for
any damage to vehicles, injury to persons or loss of property all of which
risks are assumed by the party using the parking area.
8. Validation, if established, will be permissible only by such method or
methods as Lessor and/or its licenses may establish at rates generally
applicable to visitor parking.
9. The maintenance, washing, waxing or cleaning of vehicles in the parking
structure of Common Areas is prohibited.
10. Lessee shall be responsible for seeing that all of its employes, agents
and invitees comply with the applicable parking rules, regulations, laws and
agreements.
11. Lessor reserves the right to modify these rules and/or adopt such other
reasonable and non-discriminatory rules and regulations as it may deem
necessary for the proper operation of the parking area.
12. Such parking use as is herein provided is intended merely as a license
only and no bailment is intended or shall be created hereby.
FULL SERVICE--GROSS
EXHIBIT B
PAGE 1 OF 1 PAGES
35
EXHIBIT F
OPTION TO EXTEND:
Provided that there has been no Event of Tenant's Default, Landlord hereby
grants to Tenant two (2) options to extend the Lease Term for a period of five
(5) years each (each an "Option Period") upon all of the same terms and
conditions as are contained in the Lease, except that Base Monthly Rent during
an Option Period shall be the greater of (i) Base Monthly Rent payable in the
last month of the Lease Term or initial Option Term or (ii) the then fair
Market Rent for the Premises (as hereinafter defined). In order to exercise the
option granted herein Tenant must give written notice of its election to
exercise the option no later than one hundred eighty (180) days prior to the
expiration of the Lease Term or initial Option Term.
The "then Fair Market Rent for the Premises" shall mean the fair market rental
value of the Premises as of the commencement of the Option Period including,
without limitation, rent increases over the extended term which are customary
at the commencement of the Option Period. If the parties are unable to agree on
the Base Monthly Rent for the Option Period prior to ninety (90) days before
the expiration of the initial Lease Term, or initial Option Term, then Tenant
may withdraw its exercise of the option on the following terms:
i) Tenant must notify Landlord in writing of its election to withdraw
its exercise of the option; and
ii) If less than 180 days remain in the Lease Term or Initial Option
Period, whichever is applicable, on the date Tenant withdraws its exercise of
the option, the Lease Term or Initial Option Period shall be extended on all
terms and conditions of the Lease then in effect, the number of days necessary
to make the remaining term 180 days.
