EXHIBIT 10.11 Statement re: Long Term Lease between the Registrant
and Mitsui Fudosan (USA), Inc., a California Corporation
AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION STANDARD
INDUSTRIAL/COMMERCIAL SINGLE-TENANT LEASE - NET
(Do not use this form for Multi-Tenant Property)
1. Basic Provisions ("Basic Provisions")
1.1 Parties: This Lease ("Lease"), dated for reference purposes only,
__DECEMBER 19, 1997__, is made by and between __MITSUI FUDOSAN (USA). INC., A
CALIFORNIA CORPORATION__ ("Lessor") and __PACIFIC RESEARCH & ENGINEERING
CORPORATION, A CALIFORNIA CORPORATION__ ("Lessee"), (collectively the
"Parties," or individually a "Party") __LOT 18, (5.692 ACRES) OAK RIDGE
BUSINESS CENTER III, 000 XXXXX XXX, XXXXX, XXXXXXXXXX 00000__.
1.2 Premises: That certain real property, including all improvements
therein or to be provided by Lessor under the terms of this Lease, and commonly
known by the street address of __000 XXXXX XXX, XXXXX, XXXXXXXXXX 00000__,
located in the County of __SAN DIEGO__, State of __CALIFORNIA__, and generally
described as (describe briefly the nature of the property) __APN 000-000-00
ASPEN WAY. VISTA , CALIFORNIA 92083 (SEE EXHIBIT "A") PROPOSED PREMISES IS
APPROXIMATELY 79,648 SQUARE FEET ON THE FIRST (1ST) FLOOR, WITH APPROXIMATELY
214 PARKING SPACES. (THE PREMISES WILL BE MEASURED TO THE EXTERIOR DIMENSIONS
OF THE BUILDING INCLUDING DRIP LINE.) SEE ADDENDUM FOR PARAGRAPH 1.2
(CONTINUED)__. ("Premises"). (See Paragraph 2 for further provisions.)
1.3 Term: __TEN (10)__ years and __ZERO (0)__ months ("Original
Term") commencing __SEE ADDENDUM FOR PARAGRAPH 1.3(CONT.)__ ("Commencement
Date") and ending __TEN YEARS AFTER THE COMMENCEMENT DATE__ ("Expiration
Date"). (See Paragraph 3 for further provisions.)
1.4 Early Possession: __NOT APPLICABLE__ ("Early Possession Date").
(See Paragraphs 3.2 and 3.3 for further provisions.)
1.5 Base Rent: __$ 47,719.03__ per month ("Base Rent"), payable on
the __FIRST (1ST)__ day of each month commencing __SEE ADDENDUM FOR PARAGRAPH
1.5 (CONTINUED).__ (See Paragraph 4 for further provisions.)
[ ] If this box is checked, there are provisions in this Lease for the Base
Rent to be adjusted.
1.6 Base Rent Paid Upon Execution: __$47,719.03__as Base Rent for
the period __THE FIRST (1ST) MONTH OF THE LEASE TERM.__
1.7 Security Deposit: __$ 47,719.03__ ("Security Deposit"). (See
Paragraph 5 for further provisions.)**
1.8 Permitted Use: __ADMINISTRATIVE OFFICES, MANUFACTURING,
ENGINEERING AND DISTRIBUTION OF ELECTRONIC EQUIPMENT AND RELATED USES.__
(See Paragraph 6 for further provisions.)
1.9 Insuring Party: Lessor is the "Insuring Party" unless otherwise
stated herein. (See Paragraph 8 for further provisions.)
1.10 Real Estate Brokers: The following real estate brokers
(collectively, the "Brokers") and brokerage relationships exist in this
transaction and are consented to by the Parties (check applicable boxes):
__COLLIERS XXXXX THORN__ represents
[ ] Lessor exclusively ("Lessor's Broker"); [X] both Lessor and Lessee, and
________________________ represents
[ ] Lessor exclusively ("Lessee's Broker"); [ ] both Lessee and Lessor. (See
Paragraph 15 for further provisions.)
1.11 Guarantor. The obligations of the Lessee under this Lease are to
be guaranteed by __NONE__ ("Guarantor"). (See Paragraph 37 for further
provisions.)
1.12 Addenda. Attached hereto is an Addendum or Addenda consisting of
Paragraphs __1.2__ through __49__ and Exhibits __A, B, C HAZARDOUS WASTES OR
SUBSTANCES ADDENDUM, NOTICE TO OWNERS, BUYERS AND TENANTS REGARDING HAZARDOUS
WASTES OR SUBSTANCES AND UNDERGROUND STORAGE TANK AND AMERICANS WITH
DISABILITIES ACT (ADA), ATTACHMENTS A, B, AND C.__ all of which constitute a
part of this Lease.
2. Premises.
2.1 Letting. Lessor hereby leases to Lessee, and Lessee hereby leases
from Lessor, the Premises, for the term, at the rental, and upon all of the
terms, covenants and conditions set forth in this Lease. Unless otherwise
provided herein, any statement of square footage set forth in this Lease, or
that may have been used in calculating rental, is an approximation which Lessor
and Lessee agree is reasonable and the rental based thereon is not subject to
revision whether or not the actual square footage is more or less. __SEE
ADDENDUM FOR PARAGRAPH 2.1 (CONTINUED).__
2.2 Condition. Lessor shall deliver the Premises to Lessee clean and
free of debris on the Commencement Date and warrants to Lessee that the
existing plumbing, tire sprinkler system, lighting, air conditioning, heating,
and loading doors, if any, in the Premises, other than those constructed by
Lessee, shall be in good operating condition on the Commencement Date. If a
non-compliance with said warranty exists as of the Commencement Date, Lessor
shall, except as otherwise provided in this Lease, promptly after receipt of
written notice from Lessee setting forth with specificity the nature and extent
of such non-compliance, rectify same at Lessor's expense. If Lessee does not
give Lessor written notice of a non-compliance with this warranty within
__SIXTY (60)__ days after the Commencement Date, correction of that non-
compliance shall be the obligation of Lessee at Lessee's sole cost and expense.
2.3 Compliance with Covenants, Restrictions and Building Code. Lessor
warrants to Lessee that the improvements on the Premises comply with all
applicable covenants or restrictions of record and applicable building codes,
regulations and ordinances in effect on the Commencement Date. Said warranty
does not apply to the use to which Lessee will put the Premises or to any
Alterations or Utility Installations (as defined in Paragraph 7.3(a)) made or
to be made by Lessee. If the Premises do not comply with said warranty, Lessor
shall, except as otherwise provided in this Lease, promptly after receipt of
written notice from Lessee setting forth with specificity the nature and extent
of such non-compliance, rectify the same at Lessor's expense. If Lessee does
not give Lessor written notice of a non-compliance with this warranty within
six (6) months following the Commencement Date, correction of that non-
compliance shall be the obligation of Lessee at Lessee's sole cost and expense.
__SEE ADDENDUM FOR PARAGRAPH 2.3 (CONTINUED).__
2.4 Acceptance of Premises. Lessee hereby acknowledges: (a) that it
has been advised by the Brokers to satisfy itself with respect to the condition
of the Premises (Including but not limited to the electrical and fire sprinkler
systems, security, environmental aspects, compliance with Applicable Law, as
defined in Paragraph 6.3) and the present and future suitability of the
Premises for Xxxxxx's intended use, (b) that Lessee has made such investigation
as it deems necessary with reference to such matters and assumes all
responsibility therefor as the same relate to Xxxxxx's occupancy of the
Premises and/or the term of this Lease, and (c) that neither Lessor, nor any of
Lessor's agents, has made any oral or written representations or warranties
with respect to the said matters other than as set forth In this Lease.
2.5 Lessee Prior Owner/Occupant. The warranties made by Lessor in
this Paragraph 2 shall be of no force or effect if immediately prior to the
date set forth in Paragraph 1.1 Lessee was the owner or occupant of the
Premises. In such event, Lessee shall, at Xxxxxx's sole cost and expense,
correct any non-compliance of the Premises with said warranties.
3. Term.
3.1 Term. The Commencement Date, Expiration Date and Original Term of
this Lease are as specified in Paragraph 1.3.
3.2 Early Possession. If Lessee totally or partially occupies the
Premises prior to the Commencement Date, the obligation to pay Base Rent shall
be abated for the period of such early possession. All other terms of this
Lease, however, (including but not limited to the obligations to pay Real
Property Taxes and Insurance premiums and to maintain the Premises) shall be in
effect during such period. Any such early possession shall not affect nor
advance the Expiration Date of the Original Term.
**SEE ADDENDUM FOR PARAGRAPH 1,7 (CONTINUED).
------------------------------------------------------------------------------
3.3 Delay In Possession. If for any reason Lessor cannot deliver
possession of the Premises to Lessee as agreed herein by the Early Possession
Date, if one is specified in Paragraph 1.4, or, if no Early Possession Date is
specified, by the Commencement Date, Lessor shall not be subject to any
liability therefor, nor shall such failure affect the validity of this Lease,
or the obligations of Lessee hereunder, or extend the term hereof, but in such
case, Lessee shall not, except as otherwise provided herein, be obligated to
pay rent or perform any other obligation of Lessee under the terms of this
Lease until Xxxxxx delivers possession of the Premises to Lessee. If
possession of the Premises is not delivered to Lessee within sixty (60) days
after the __DATE THAT IS EIGHT (8) MONTHS FROM THE DATE LESSOR AND LESSEE
MUTUALLY AGREE UPON THE PROPOSED PLANS__, Lessee may, at its 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 if such written notice by Xxxxxx is not received by
Lessor within said ten (10) day period, Xxxxxx's right to cancel this Lease
shall terminate and be of no further force or effect. Except as may be
otherwise provided, and regardless of when the term actually commences, if
possession is not tendered to Lessee when required by this Lease and Lessee
does not terminate this Lease, as aforesaid, the period free of the obligation
to pay Base Rent, if any, that Lessee would otherwise have enjoyed shall run
from the date of delivery of possession and continue for a period equal to what
Lessee would otherwise have enjoyed under the terms hereof, but minus any days
of delay caused by the acts, changes or omissions of Lessee.
4. Rent.
4.1 Base Rent. Lessee shall cause payment of Base Rent and other
rent or charges, as the same may be adjusted from time to time, to be received
by Lessor in lawful money of the United States, without offset or deduction, on
or before the day on which it is due under the terms of this Lease. Base Rent
and all other rent and charges for any period during the term hereof which is
for less than one (1) full calendar month shall be prorated based upon the
actual number of days of the calendar month involved. Payment of Base Rent and
other charges shall be made to Lessor at its address stated herein or to such
other persons or at such other addresses as Lessor may from time to time
designate in writing to Lessee.
5. Security Deposit. Lessee shall deposit with Lessor upon execution
hereof the Security Deposit set forth in Paragraph 1.7 as security for Xxxxxx's
faithful performance of Xxxxxx's obligations under this Lease. If Lessee fails
to pay Base Rent or other rent or charges due hereunder, or otherwise Defaults
under this Lease (as defined in Paragraph 13.1), Lessor may use, apply or
retain all or any portion of said Security Deposit for the payment of any
amount due Lessor or to reimburse or compensate Lessor for any liability, cost,
expense, loss or damage (including attorneys' fees) which Lessor may suffer or
incur by reason thereof. If Lessor uses or applies all or any portion of said
Security Deposit, Lessee shall within ten (10) days after written request
therefor deposit moneys with Lessor sufficient to restore said Security Deposit
to the full amount required by this Lease. Any time the Base Rent increases
during the term of this Lease, Lessee shall, upon written request from Lessor,
deposit additional moneys with Lessor sufficient to maintain the same ratio
between the Security Deposit and the Base Rent as those amounts are specified
in the Basic Provisions. Lessor shall not be required to keep all or any part
of the Security Deposit separate from its general accounts. Lessor shall, at
the expiration or earlier termination of the term hereof and after Xxxxxx has
vacated the Premises, return to Lessee (or, at Lessor's option, to the last
assignee, if any, of Xxxxxx's interest herein), that portion of the Security
Deposit not used or applied by Lessor. Unless otherwise expressly agreed in
writing by Xxxxxx, no part of the Security Deposit shall be considered to be
held in trust, to bear interest or other increment for its use, or to be
prepayment for any moneys to be paid by Lessee under this Lease.
6. Use.
6.1 Use. Lessee shall use and occupy the Premises only for the
purposes set forth in Paragraph 1.8, or any other use which is comparable
thereto, and for no other purpose. Lessee shall not use or permit the use of
the Premises in a manner that creates waste or a nuisance, or that disturbs
owners and/or occupants of, or causes damage to, neighboring premises or
properties. Lessor hereby agrees to not unreasonably withhold or delay its
consent to any written request by Lessee, Lessees assignees or subtenants,
and by prospective assignees and subtenants of the Lessee, its assignees and
subtenants, for a modification of said permitted purpose for which the
premises may be used or occupied, so long as the same will not impair the
structural integrity of the improvements on the Premises, the mechanical or
electrical systems therein, is not significantly more burdensome to the
Premises and the improvements thereon, and is otherwise permissible pursuant to
this Paragraph 6. If Lessor elects to withhold such consent, Lessor shall
within five (5) business days give a written notification of same, which notice
shall include an explanation of Lessor's reasonable objections to the change
in use.
6.2 Hazardous Substances.
(a) Reportable Uses Require Consent. The term Hazardous Substance
as used in this Lease shall mean any product, substance, chemical, material or
waste whose presence, nature, quantity and/or intensity of existence, use,
manufacture, disposal, transportation, spill, release or effect, either by
itself or in combination with other materials expected to be on the Premises,
is either: (i) potentially injurious to the public health, safety or welfare,
the environment or the Premises, (ii) regulated or monitored by any
governmental authority, or (iii) a basis for liability of Lessor to any
governmental agency or third party under any applicable statute or common law
theory. Hazardous Substance shall include, but not be limited to,
hydrocarbons, petroleum, gasoline, crude oil or any products, by-products or
fractions thereof. Lessee shall not engage in any activity in, on or about the
Premises which constitutes a Reportable Use (as hereinafter defined) of
Hazardous Substances without the express prior written consent of Lessor and
compliance in a timely manner (at Xxxxxx's sole cost and expense) with all
Applicable Law (as defined in Paragraph 6.3). "Reportable Use" shall mean
(i) the installation or use of any above or below ground storage tank,
(ii) the generation, possession, storage, use, transportation, or disposal of
a Hazardous Substance that requires a permit from, or with respect to which a
report, notice, registration or business plan is required to be filed with,
any governmental authority. Reportable Use shall also include Xxxxxx's being
responsible for the presence in, on or about the Premises of a Hazardous
Substance with respect to which any Applicable Law requires that a notice be
given to persons entering or occupying the Premises or neighboring properties.
Notwithstanding the foregoing, Lessee may, without Lessors prior consent, but
in compliance with all Applicable Law, use any ordinary and customary materials
reasonably required to be used by Lessee in the normal course of Lessee's
business permitted on the Premises, so long as such use is not a Reportable Use
and does not expose the Premises or neighboring properties to any meaningful
risk of contamination or damage or expose Lessor to any liability therefor.
In addition, Lessor may (but without any obligation to do so) condition its
consent to the use or presence of any Hazardous Substance, activity or storage
tank by Lessee upon Lessee's giving Lessor such additional assurances as
Lessor, in its reasonable discretion, deems necessary to protect itself, the
public, the Premises and the environment against damage, contamination or
injury and/or liability therefrom or therefor, including, but not limited to,
the installation (and removal on or before Lease expiration or earlier
termination) of reasonably necessary protective modifications to the Premises
(such as concrete encasements) and/or the deposit of an additional Security
Deposit under Paragraph 5 hereof.
(b) Duty to inform Xxxxxx. If Lessee knows, or has reasonable
cause to believe, that a Hazardous Substance, or a condition involving or
resulting from same, has come to be located in, on, under or about the
Premises, other than as previously consented to by Xxxxxx, Xxxxxx shall
immediately give written notice of such fact to Lessor. Lessee shall also
immediately give Lessor a copy of any statement, report, notice, registration,
application, permit, business plan, license, claim, action or proceeding given
to, or received from, any governmental authority or private party, or persons
entering or occupying the Premises, concerning the presence, spill, release,
discharge of, or exposure to, any Hazardous Substance or contamination in, on,
or about the Premises, including but not limited to all such documents as may
be involved in any Reportable Uses involving the Premises.
(c) Indemnification. Lessee shall indemnify, protect, defend and
hold Lessor, its agents, employees, lenders and ground lessor, If any, and the
Premises, harmless from and against any and all loss of rents and/or damages,
liabilities, judgments, costs, claims, liens, expenses, penalties, permits and
attorney's and consultant's fees arising out of or involving any Hazardous
Substance or storage tank brought onto the Premises by or for Lessee or under
Lessee's control. Lessee's obligations under this Paragraph 6 shall include,
but not be limited to, the effects of any contamination or injury to person,
property or the environment created or suffered by Xxxxxx, and the cost of
investigation (including consultant's and attorney's fees and testing),
removal, remediation, restoration and/or abatement thereof, or of any
contamination therein involved, and shall survive the expiration or earlier
termination of this Lease. No termination, cancellation or release agreement
entered into by Lessor and Lessee shall release Lessee from its obligations
under this Lease with respect to Hazardous Substances or storage tanks, unless
specifically so agreed by Lessor in writing at the time of such agreement.
6.3 Lessee's Compliance with Law. Except as otherwise provided in
this Lease, Lessee, shall, at Xxxxxx's sole cost and expense, fully, diligently
and in a timely manner, comply with all "Applicable Law," which term is used in
this Lease to include all laws, rules, regulations, ordinances, directives,
covenants, easements and restrictions of record, permits, the requirements of
any applicable fire insurance underwriter or rating bureau, and the
recommendations of Lessor's engineers and/or consultants, relating in any
manner to the Premises (including but not limited to matters pertaining to
(i) industrial hygiene, (ii) environmental conditions on, in, under or about
the Premises, including soil and groundwater conditions, and (iii) the use,
generation, manufacture, production, installation, maintenance, removal,
transportation, storage, spill or release of any Hazardous Substance or storage
tank), now in effect or which may hereafter come into effect, and whether or
not reflecting a change in policy from any previously existing policy Lessee
shall, within five (5) days after receipt of Lessor's written request, provide
Lessor with copies of all documents and information, including, but not limited
to, permits, registrations, manifests, applications, reports and certificates,
evidencing Lessee's compliance with any Applicable Law specified by Lessor, and
shall immediately upon receipt, notify Lessor in writing (with copies of any
documents involved) of any threatened or actual claim, notice, citation,
warning, complaint or report pertaining to or involving failure by Lessee or
the Premises to comply with any Applicable Law.
6.4 Inspection; Compliance. Lessor and Lessor's Lender(s) (as defined
in Paragraph 8.3(a)) shall have the right to enter the Premises at any time, in
the case of an emergency, and otherwise at reasonable times, with twenty-four
(24) hour notice, for the purpose of inspecting the condition of the Premises
and for verifying compliance by Lessee with this Lease and all Applicable Laws
(as defined in Paragraph 6.3), and to employ experts and/or consultants in
connection therewith and/or to advise Lessor with respect to Xxxxxx's
activities, including but not limited to the installation, operation, use,
monitoring, maintenance, or removal of any Hazardous Substance or storage tank
on or from the Premises. The costs and expenses of any such inspections shall
be paid by the party requesting same, unless a Default or Breach of this Lease,
violation of Applicable Law, or a contamination, caused or materially
contributed to by Lessee is found to exist or be imminent, or unless the
inspection is requested or ordered by a governmental authority as the result of
any such existing or imminent violation or contamination. In any such case,
Xxxxxx shall upon request reimburse Lessor or Xxxxxx's Lender, as the case may
be, for the costs and expenses of such inspections
7. Maintenance; Repairs; Utility Installations; Trade Fixtures and
Alterations.
7.1 Lessee's Obligations.
(a) Subject to the provisions of Paragraphs 2.2 (Lessor's warranty
as to condition), 2.3 (Lessor's warranty as to compliance with covenants, etc),
------------------------------------------------------------------------------
7.2 (Lessor's obligations to repair), 9 (damage and destruction), and 14
(condemnation), Lessee shall, at Lessee's sole cost and expense and at all
times, keep the Premises and every part thereof in good order, condition and
repair __INCLUDING__ non-structural (whether or not such portion of the
Premises requiring repairs, or the means of repairing the same, are reasonably
or readily accessible to Lessee, and whether or not the need for such repairs
occurs as a result of Lessee's use, any prior use, the elements or the age of
such portion of the Premises), including, without limiting the generality of
the foregoing, all equipment or facilities serving the Premises, such as
plumbing, heating, air conditioning, ventilating, electrical, lighting
facilities, boilers, fired or unfired pressure vessels, fire sprinkler and/or
standpipe and hose or other automatic fire extinguishing system, including
fire alarm and/or smoke detection systems and equipment, fire hydrants,
fixtures, walls (interior), ceilings, roofs, floors, windows, doors, plate
glass, skylights landscaping, driveways, parking lots, fences, retaining walls,
signs, sidewalks and parkways located in, on, about, or adjacent to the
Premises. Lessee shall not cause or permit any Hazardous Substance to be
spilled or released in, on, under or about the Premises (including through the
plumbing or sanitary sewer system) and shall promptly, at Lessee's expense;
take all Investigatory and/or remedial action reasonably recommended, whether
or not formally ordered or required, for the cleanup of any contamination of,
and for the maintenance, security and/or monitoring of the Premises, the
elements surrounding same, or neighboring properties, that was caused or
materially contributed to by Lessee, or pertaining to or involving any
Hazardous Substance and/or storage tank brought onto the Premises by or for
Lessee or under its control. Lessee, in keeping the Premises in good order,
condition and repair, shall exercise and perform good maintenance practices.
Lessee's obligations shall include restorations, replacements or renewals when
necessary to keep the Premises and all improvements thereon or a part thereof
in good order, condition and state of repair if Lessee occupies the Premises
for seven (7) years or more, Lessor may require Lessee to repaint the exterior
of the buildings on the Premises as reasonably required, but not more
frequently than once every seven (7) years.
(b) Lessee shall, at Xxxxxx's sole cost and expense, procure and
maintain contracts, with copies to Lessor, in customary form and substance
for, and with contractors specializing and experienced in, the inspection,
maintenance and service of the following equipment and improvements, if any.
located on the Premises: (i) heating, air conditioning and ventilation
equipment, (ii) boiler, fired or unfired pressure vessels, (iii) fire sprinkler
and/or standpipe and hose or other automatic fire extinguishing systems,
Including fire alarm and/or smoke detection, (iv) landscaping and irrigation
systems, (v) roof covering and drain maintenance and (vi) asphalt and parking
lot maintenance.
7.2 Lessor's Obligations. Except for the warranties and agreements of
Lessor contained in Paragraphs 2.2 (relating to condition of the Premises),
2.3 (relating to compliance with covenants, restrictions and building code),
9 (relating to destruction of the Premises) and 14 (relating to condemnation of
the Premises), it is intended by the Parties hereto that Lessor have no
obligation, in any manner whatsoever, to repair and maintain the Premises,
__EXCEPT FOR STRUCTURAL PORTIONS OF THE ROOF, FOUNDATION AND,.EXTERIOR WALLS,__
the improvements located thereon, or the equipment therein, all of which
obligations are intended to be that of the Lessee under Paragraph 7.1 hereof.
It is the intention of the Parties that the terms of this Lease govern the
respective obligations of the Parties as to maintenance and repair of the
Premises. Lessee and Lessor expressly waive the benefit of any statute now or
hereafter in effect to the extent it is inconsistent with the terms of this
Lease with respect to, or which affords Lessee the right to make repairs at the
expense of Lessor or to terminate this Lease by reason of any needed repairs.
7.3 Utility Installations; Trade Fixtures; Alterations.
(a) Definitions; Consent Required. The term "Utility
Installations" is used in this Lease to refer to all carpeting, window
coverings, air lines, power panels, electrical distribution, security, fire
protection systems, communication systems, lighting fixtures, heating,
ventilating, and air conditioning equipment, plumbing, and fencing in, on or
about the Premises. The term "Trade Fixtures" shall mean Lessee's machinery
and equipment that can be removed without doing material damage to the
Premises. The term "Alterations" shall mean any modification of the
improvements on the Premises from that which are provided by Lessor under the
terms of this Lease, other than Utility Installations or Trade Fixtures,
whether by addition or deletion. "Lessee Owned Alterations and/or Utility
Installations" are defined as Alterations and/or Utility Installations made by
lessee that are not yet owned by Lessor as defined in Paragraph 7.4(a). Lessee
shall not make any Alterations or Utility installations in, on, under or about
the Premises without Lessor's prior written consent. Lessee may, however, make
non-structural Utility Installations to the interior of the Premises (excluding
the roof), as long as they are not visible from the outside, do not involve
puncturing, relocating or removing the roof or any existing walls, and the
cumulative cost thereof during the term of this Lease as extended does not
exceed $25,000.
(b) Consent. Any Alterations or Utility Installations that Lessee
shall desire to make and which require the consent of the Lessor shall be
presented to Lessor in written form with proposed detailed plans. All consents
given by Lessor, whether by virtue of Paragraph 7.3(a) or by subsequent
specific consent, shall be deemed conditioned upon: (i) Lessee's acquiring all
applicable permits required by governmental authorities, (ii) the furnishing of
copies of such permits together with a copy of the plans and specifications for
the Alteration or Utility Installation to Lessor prior to commencement of the
work thereon, and (iii) the compliance by Lessee with all conditions of said
permits in a prompt and expeditious manner. Any Alterations or Utility
Installations by Xxxxxx during the term of this Lease shall be done in a good
and workmanlike manner, with good and sufficient materials, and in compliance
with all Applicable Law. Lessee shall promptly upon completion thereof furnish
Lessor with as-built plans and specifications therefor Lessor may (but without
obligation to do so) condition its consent to any requested Alteration or
Utility Installation that costs $10,000 or more upon Lessee's providing Lessor
with a lien and completion bond in an amount equal to one and one-half times
the estimated cost of such Alteration or Utility Installation and/or upon
Lessee's posting an additional Security Deposit with Lessor under Paragraph 36
hereof.
(c) Indemnification. 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 on the Premises, which claims are or may be secured by any
mechanics' or materialmen's lien against the Premises or any interest therein.
Lessee shall give Lessor not less than ten (10) days' notice prior to the
commencement of any work in, on or about the Premises, and Lessor shall have
the right to post notices of non-responsibility in or on the Premises as
provided by law. If Xxxxxx shall, in good faith, contest the validity of any
such lien, claim or demand, then Lessee shall, at its sole expense defend and
protect itself, Lessor and the Premises against the same and shall pay and
satisfy any such adverse judgment that may be rendered thereon before the
enforcement thereof against the Lessor or the Premises. If Lessor shall
require, Lessee shall furnish to Lessor a surety bond satisfactory to Lessor in
an amount equal to one and one-half times the amount of such contested lien
claim or demand, indemnifying Lessor against liability for the same, as
required by law for the holding of the Premises free from the effect of such
lien or claim. In addition, Lessor may require Lessee to pay Xxxxxx's
attorney's fees and costs in participating in such action if Lessor shall
decide it is to its best interest to do so.
7.4 Ownership; Removal; Surrender; and Restoration.
(a) Ownership. Subject to Lessor's right to require their removal
or become the owner thereof as hereinafter provided in this Paragraph 7.4, all
Alterations and Utility Additions made to the Premises by Lessee shall be the
property of and owned by Xxxxxx, but considered a part of the Premises. Lessor
may at any time and at its option, elect in writing to Lessee to be the owner
of all or any specified part of the Lessee Owned Alterations and Utility
installations. Unless otherwise instructed per subparagraph 7.4(b) hereof, all
Lessee Owned Alterations and Utility Installations shall, at the expiration or
earlier termination of this Lease, become the property of Lessor and remain
upon and be surrendered by Lessee with the Premises.
(b) Removal. Unless otherwise agreed in writing, Lessor may
require that any or all Lessee Owned Alterations or Utility Installations be
removed by the expiration or earlier termination of this Lease, notwithstanding
their installation may have been consented to by Lessor. Lessor may require
the removal at any time of all or any part of any Lessee Owned Alterations or
Utility Installations made without the required consent of Lessor.
SEE ADDENDUM FOR PARAGRAPH 7.4(B) (CONTINUED)
(c) Surrender/Restoration. Lessee shall surrender the Premises by
the end of the last day of the Lease term or any earlier termination date, with
all of the improvements, parts and surfaces thereof clean and free of debris
and in good operating order, condition and state of repair, ordinary wear and
tear excepted. "Ordinary wear and tear" shall not include any damage or
deterioration that would have been prevented by good maintenance practice or by
Xxxxxx performing all of its obligations under this Lease. Except as otherwise
agreed or specified in writing by Xxxxxx, the Premises, as surrendered, shall
include the Utility Installations. The obligation of Lessee shall include the
repair of any damage occasioned by the installation, maintenance or removal of
Lessee's Trade Fixtures, furnishings, equipment, and Alterations and/or Utility
Installations, as welt as the removal of any storage tank installed by or for
Lessee, and the removal, replacement, or remediation of any soil, material or
ground water contaminated by Lessee, all as may then be required by Applicable
Law and/or good service practice. Lessee's Trade Fixtures shall remain the
property of Xxxxxx and shall be removed by Lessee subject to its obligation to
repair and restore the Premises per this Lease.
8. Insurance; Indemnity.
8.1 Payment For Insurance. Regardless of whether the Lessor or Lessee
is the insuring Party, Lessee shall pay for all insurance required under this
Paragraph 8 except to the extent of the cost attributable to liability
insurance carried by Lessor in excess of $1,000,000 per occurrence. Premiums
for policy periods commencing prior to or extending beyond the Lease term shall
be prorated to correspond to the Lease term. Payment shall be made by Lessee
to Lessor within ten (10) days following receipt of an invoice for any amount
due.
8.2 Liability Insurance.
(a) Carried by Xxxxxx. Xxxxxx shall obtain and keep in force
during the term of this Lease a Commercial General Liability policy of
insurance protecting Xxxxxx and Xxxxxx (as an additional insured) against
claims for bodily injury, personal injury and property damage based upon,
involving or arising out of the ownership, use, occupancy or maintenance of the
Premises and all areas appurtenant thereto. Such insurance shall be on an
occurrence basis providing single limit coverage in an amount not less than
$1,000,000 per occurrence with an "Additional Insured-Managers or Lessors of
Premises" Endorsement and contain the "Amendment of the Pollution Exclusion"
for damage caused by heat, smoke or fumes from a hostile fire. The policy
shall not contain any intra-insured exclusions as between insured persons or
organizations, but shall include coverage for liability assumed under this
Lease as an "insured contract" for the performance of Xxxxxx's indemnity
obligations under this Lease. The limits of said insurance required by this
Lease or as carried by Lessee shall not, however, limit the liability of Lessee
nor relieve Xxxxxx of any obligation hereunder. All insurance to be carried by
Lessee shall be primary to and not contributory with any similar insurance
carried by Lessor, whose insurance shall be considered excess insurance only.
(b) Carried By Lessor. In the event Lessor is the Insuring Party,
Lessor shall also maintain liability insurance described In Paragraph 8.2(a),
above, in addition to, and not in lieu of, the insurance required to be
maintained by Lessee. Lessee shall not be named as an additional insured
therein.
------------------------------------------------------------------------------
8.3 Property Insurance-Building, Improvements and Rental Value.
(a) Building and Improvements. The Insuring Party shall obtain
and keep in force during the term of this Lease a policy or policies in the
name of Lessor, with loss payable to Lessor and to the holders of any
mortgages, deeds of trust or ground leases on the Premises ("Lender(s)"),
insuring loss or damage to the Premises. The amount of such insurance shall be
equal to the full replacement cost of the Premises, as the same shall exist
from time to time, or the amount required by Lenders, but in no event more than
the commercially reasonable and available insurable value thereof if, by reason
of the unique nature or age of the improvements involved, such latter amount is
less than full replacement cost. If Lessor is the Insuring Party, however,
Lessee Owned Alterations and Utility installations shall be insured by Lessee
under Paragraph 8.4 rather than by Lessor. If the coverage is available and
commercially appropriate, such policy or policies shall insure against all
risks of direct physical loss or damage (except the perils of flood and/or
earthquake unless required by a Lender), including coverage for any additional
costs resulting from debris removal and reasonable amounts of coverage for the
enforcement of any ordinance or law regulating the reconstruction or
replacement of any undamaged sections of the Premises required to be demolished
or removed by reason of the enforcement of any building, zoning, safety or land
use laws as the result of a covered cause of loss. Said policy or policies
shall also contain an agreed valuation provision in lieu of any coinsurance
clause, waiver of subrogation, and inflation guard protection causing an
increase in the annual property insurance coverage amount by a factor of not
less than the adjusted U.S. Department of Labor Consumer Price Index for All
Urban Consumers for the city nearest to where the Premises are located. If
such insurance coverage has a deductible clause, the deductible amount shall
not exceed $1,000 per occurrence, and Lessee shall be liable for such
deductible amount in the event of an Insured Loss, as defined in Paragraph
9.1(c).
(b) Rental Value. The insuring Party shall, in addition, obtain
and keep in force during the term of this Lease a policy or policies in the
name of Lessor, with loss payable to Lessor and Lender(s), insuring the loss of
the full rental and other charges payable by Lessee to Lessor under this Lease
for one (1) year (including all real estate taxes, insurance costs, and any
scheduled rental increases). Said insurance shall provide that in the event
the Lease is terminated by reason of an insured loss, the period of indemnity
for such coverage shall be extended beyond the date of the completion of
repairs or replacement of the Premises, to provide for one full year's loss of
rental revenues from the date of any such loss. Said insurance shall contain
an agreed valuation provision in lieu of any coinsurance clause, and the amount
of coverage shall be adjusted annually to reflect the projected rental income,
property taxes, insurance premium costs and other expenses, if any, otherwise
payable by Lessee, for the next twelve (12) month period. Lessee shall be
liable for any deductible amount in the event of such loss.
(c) Adjacent Premises. If the Premises are part of a larger
building, or if the Premises are part of a group of buildings owned by Lessor
which are adjacent to the Premises, the Lessee shall pay for any increase in
the premiums for the property insurance of such building or buildings if said
increase is caused by Xxxxxx's acts, omissions, use or occupancy of the
Premises.
(d) Tenant's Improvements. If the Lessor is the Insuring Party,
the Lessor shall not be required to insure Lessee Owned Alterations and Utility
Installations unless the item in question has become the property of Lessor
under the terms of this Lease. If Lessee is the Insuring Party, the policy
carried by Lessee under this Paragraph 8.3 shall insure Lessee Owned
Alterations and Utility installations.
8.4 Lessee's Property Insurance. Subject to the requirements of
Paragraph 8.5, Lessee at its cost shall either by separate policy or, at
Lessor's option, by endorsement to a policy already carried, maintain insurance
coverage on all of Lessee's personal property, Lessee Owned Alterations and
Utility Installations in, on, or about the Premises similar in coverage to that
carried by the Insuring Party under Paragraph 8.3. Such insurance shall be
full replacement cost coverage with a deductible of not to exceed $1,000 per
occurrence. The proceeds from any such insurance shall be used by Lessee for
the replacement of personal property or the restoration of Lessee Owned
Alterations and Utility Installations. Lessee shall be the Insuring Party with
respect to the insurance required by this Paragraph 8.4 and shall provide
Lessor with written evidence that such insurance is in force.
8.5 Insurance Policies. Insurance required hereunder shall be in
companies duly licensed to transact business in the state where the Premises
are located, and maintaining during the policy term a "General Policyholders
Rating" of at least B+, V, or such other rating as may be required by a Lender
having a lien on the Premises, as set forth in the most current issue of
"Best's Insurance Guide." Lessee shall not do or permit to be done anything
which shall invalidate the insurance policies referred to in this Paragraph 8.
If Lessee is the Insuring Party, Lessee shall cause to be delivered to Lessor
certified copies of policies of such insurance or certificates evidencing the
existence and amounts of such insurance with the insureds and loss payable
clauses as required by this Lease. No such policy shall be cancellable or
subject to modification except after thirty (30) days prior written notice to
Lessor. Lessee shall at least thirty (30) days prior to the expiration of such
policies, furnish Lessor with evidence of renewals or "insurance binders"
evidencing renewal thereof, or Lessor may order such insurance and charge the
cost thereof to Lessee, which amount shall be payable by Lessee to Lessor upon
demand. If the Insuring Party shall fail to procure and maintain the insurance
required to be carried by the Insuring Party under this Paragraph 8, the other
Party may, but shall not be required to, procure and maintain the same, but at
Xxxxxx's expense.
8.6 Waiver of Subrogation. Without affecting any other rights or
remedies, Xxxxxx and Lessor ("Waiving Party") each hereby release and relieve
the other, and waive their entire right to recover damages (whether in contract
or in tort) against the other, for loss of or damage to the Waiving Party's
property arising out of or incident to the perils required to be insured
against under Paragraph 8. The effect of such releases and waivers of the
right to recover damages shall not be limited by the amount of insurance
carried or required, or by any deductibles applicable thereto.
8.7 Indemnity. Except for Xxxxxx's negligence and/or breach of
express warranties, Lessee shall indemnify, protect, defend and hold harmless
the Premises, Lessor and its agents, Lessor's master or ground lessor, partners
and Lenders, from and against any and all claims, loss of rents and/or damages,
, liens, judgments, penalties, permits, attorney's and consultant's fees,
expenses and/or liabilities arising out of, involving, or in dealing with, the
occupancy of the Premises by Xxxxxx, the conduct of Xxxxxx's business, any act,
omission or neglect of Lessee, its agents, contractors, employees or invitees,
and out of any Default or Breach by Lessee in the performance in a timely
manner of any obligation on Xxxxxx's part to be performed under this Lease.
The foregoing shall include, but not be limited to, the defense or pursuit of
any claim or any action or proceeding involved therein, and whether or not (in
the case of claims made against Lessor) litigated and/or reduced to judgment,
and whether well founded or not. In case any action or proceeding be brought
against Lessor by reason of any of the foregoing matters, Lessee upon notice
from Xxxxxx shall defend the same at Xxxxxx's expense by counsel reasonably
satisfactory to Lessor and Xxxxxx shall cooperate with Lessee in such defense.
Lessor need not have first paid any such claim in order to be so indemnified.
8.8 Exemption of Lesser from Liability. Lessor shall not be liable
for injury or damage to the person or goods, wares, merchandise or other
property of Lessee, Lessee's employees, contractors, invitees, customers, or
any other person in or about the Premises, whether such damage or injury is
caused by or results from fire, steam, electricity, gas, water or rain, or from
the breakage, leakage, obstruction or other defects of pipes, fire sprinklers,
wires, appliances, plumbing, air conditioning or lighting fixtures, or from any
other cause, whether the said injury or damage results from conditions arising
upon the Premises or upon other portions of the building of which the Premises
are a part, or from other sources or places, and regardless of whether the
cause of such damage or injury or the means of repairing the same is accessible
or not. Lessor shall not be liable for any damages arising from any act or
neglect of any other tenant of Lessor. Notwithstanding Lessor's negligence or
breach of this Lease, Lessor shall under no circumstances be liable for injury
to Xxxxxx's business or for any loss of income or profit therefrom.
9. Damage or Destruction.
9.1 Definitions.
(a) "Premises Partial Damage" shall mean damage or destruction to
the improvements on the Premises, other than Lessee Owned Alterations and
Utility Installations, the repair cost of which damage or destruction is less
than 50% of the then Replacement Cost of the Premises immediately prior to such
damage or destruction, excluding from such calculation the value of the land
and Lessee Owned Alterations and Utility installations.
(b) "Premises Total Destruction" shall mean damage or destruction
to the Premises, other than Lessee Owned Alterations and Utility Installations
the repair cost of which damage or destruction is 50% or more of the then
Replacement Cost of the Premises immediately prior to such damage or
destruction, excluding from such calculation the value of the land and Lessee
Owned Alterations and Utility Installations.
(c) "Insured Loss" shall mean damage or destruction to
improvements on the Premises, other than Lessee Owned Alterations and Utility
Installations, which was caused by an event required to be covered by the
insurance described in Paragraph 8.3(a), irrespective of any deductible amounts
or coverage limits involved.
(d) "Replacement Cost" shall mean the cost to repair or rebuild
the improvements owned by Lessor at the time of the occurrence to their
condition existing immediately prior thereto, including demolition, debris
removal and upgrading required by the operation of applicable building codes,
ordinances or laws, and without deduction for depreciation.
(e) "Hazardous Substance Condition" shall mean the occurrence or
discovery of a condition involving the presence of, or a contamination by, a
Hazardous Substance as defined in Paragraph 6.2(a), in, on, or under the
Premises.
9.2 Partial Damage-Insured Loss. If a Premises Partial Damage that is
an Insured Loss occurs, then Lessor shall, at Lessor's expense, repair such
damage (but not Lessee's Trade Fixtures or Lessee Owned Alterations and Utility
Installations) as soon as reasonably possible and this Lease shall continue in
full force and effect; provided, however, that Lessee shall, at Lessor's
election, make the repair of any damage or destruction the total cost to repair
of which is $10,000 or less, and, in such event, Lessor shall make the
insurance proceeds available to Lessee on a reasonable basis for that purpose.
Notwithstanding the foregoing, if the required insurance was not in force or
the insurance proceeds are not sufficient to effect such repair the Insuring
Party shall promptly contribute the shortage in proceeds (except as to the
deductible which is Xxxxxx's responsibility) as and when required to complete
said repairs. In the event, however, the shortage in proceeds was due to the
fact that, by reason of the unique nature of the improvements, full replacement
cost insurance coverage was not commercially reasonable and available, Lessor
shall have no obligation to pay for the shortage in insurance proceeds or to
fully restore the unique aspects of the Premises unless Lessee provides Lessor
with the funds to cover same, or adequate assurance thereof, within ten (10)
days following receipt of written notice of such shortage and request therefor.
If Lessor receives said funds or adequate assurance thereof within said ten
(10) day period, the party responsible for making the repairs shall complete
them as soon as reasonably possible and this Lease shall remain in full force
and effect. If Lessor does not receive such funds or assurance within said
period, Lessor may nevertheless elect by written notice to Lessee within ten
(10) days thereafter to make such restoration and repair as is commercially
reasonable with Lessor paying any shortage in proceeds, in which case this
Lease shall remain in full force and effect. If in such case Lessor does not
so elect, then this Lease shall terminate sixty (60) days following the
occurrence of the damage or destruction. Unless otherwise agreed, Xxxxxx shall
in no event have any right to reimbursement from Xxxxxx for
------------------------------------------------------------------------------
any funds contributed by Lessee to repair any such damage or destruction.
Premises Partial Damaged due to flood or earthquake shall be subject to
Paragraph 9.3 rather than Paragraph 9.2, notwithstanding that there may be some
insurance coverage, but the net proceeds of any such insurance shall be made
available for the repairs if made by either Party.
9.3 Partial Damage-Uninsured Loss. If a Premises Partial Damage that
is not an Insured Loss occurs, unless caused by a negligent or willful act of
Lessee (in which event Lessee shall make the repairs at Lessee's expense and
this Lease shall continue in full force and effect, but subject to Lessor's
rights under Paragraph 13), 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 receipt by Lessor of knowledge of the
occurrence of such damage of Lessor's desire to terminate this Lease as of the
date sixty (60) days following the giving of such notice. In the event Lessor
elects to give such notice of Xxxxxx's intention to terminate this Lease,
Lessee shall have the right within ten (10) days after the receipt of such
notice to give written notice to Lessor of Xxxxxx's commitment to pay for the
repair of such damage totally at Xxxxxx's expense and without reimbursement
from Lessor. Lessee shall provide Lessor with the required funds or
satisfactory assurance thereof within thirty (30) days following Xxxxxx's said
commitment. In such event this Lease shall continue in full force and effect,
and Lessor shall proceed to make such repairs as soon as reasonably possible
and the required funds are available. If Lessee does not give such notice and
provide the funds or assurance thereof within the times specified above, this
Lease shall terminate as of the date specified in Lessor's notice of
termination.
9.4 Total Destruction. Notwithstanding any other provision hereof, if
a Premises Total Destruction occurs (including any destruction required by any
authorized public authority), this Lease shall terminate sixty (60) days
following the date of such Premises Total Destruction, whether or not the
damage or destruction is an Insured Loss or was caused by a negligent or
willful act of Lessee. In the event, however, that the damage or destruction
was caused by Xxxxxx, Lessor shall have the right to recover Xxxxxx's damages
from Xxxxxx except as released and waived in Paragraph 8.6.
9.5 Damage Near End of Term. If at any time during the last six (6)
months of the term of this Lease there is damage for which the cost to repair
exceeds one (1) month's Base Rent, whether or not an Insured Loss, Lessor may,
at Lessor's option, terminate this Lease effective sixty (60) days following
the date of occurrence of such damage by giving written notice to Lessee of
Lessor's election to do so within thirty (30) days after the date of occurrence
of such damage. Provided, however, if Lessee at that time has an exercisable
option to extend this Lease or to purchase the Premises, then Lessee may
preserve this Lease by, within twenty (20) days following the occurrence of the
damage, or before the expiration of the time provided in such option for its
exercise, whichever is earlier ("Exercise Period"), (i) exercising such option
and (ii) providing Lessor with any shortage in insurance proceeds (or adequate
assurance thereof) needed to make the repairs. If Lessee duly exercises such
option during said Exercise Period and provides Lessor with funds (or adequate
assurance thereof) to cover any shortage in insurance proceeds, Lessor shall,
at Lessor's expense repair such damage as soon as reasonably possible and this
Lease shall continue in full force and effect. If Lessee fails to exercise
such option and provide such funds or assurance during said Exercise Period,
then Lessor may at Lessor's option terminate this Lease as of the expiration of
said sixty (60) day period following the occurrence of such damage by giving
written notice to Lessee of Lessor's election to do so within ten (10) days
after the expiration of the Exercise Period, notwithstanding any term or
provision in the grant of option to the contrary.
9.6 Abatement of Rent; Xxxxxx's Remedies.
(a) In the event of damage described in Paragraph 9.2 (Partial
Damage-Insured), whether or not Lessor or Lessee repairs or restores the
Premises, the Base Rent, Real Property Taxes, insurance premiums, and other
charges, if any, payable by Lessee hereunder for the period during which such
damage, its repair or the restoration continues (not to exceed the period for
which rental value insurance is required under Paragraph 8.3(b)), shall be
abated in proportion to the degree to which Xxxxxx's use of the Premises is
impaired. Except for abatement of Base Rent, Real Property Taxes, insurance
premiums, and other charges, if any, as aforesaid, all other obligations of
Lessee hereunder shall be performed by Xxxxxx, and Xxxxxx shall have no claim
against Lessor for any damage suffered by reason of any such repair or
restoration.
(b) If Lessor shall be obligated to repair or restore the Premises
under the provisions of this Paragraph 9 and shall not commence, in a
substantial and meaningful way, the repair or restoration of the Premises
within ninety (90) days after such obligation shall accrue, Lessee may, at any
time prior to the commencement of such repair or restoration, give written
notice to Lessor and to any Lenders of which Lessee has actual notice of
Lessee's election to terminate this Lease on a date not less than sixty (60)
days following the giving of such notice. If Lessee gives such notice to
Lessor and such Lenders and such repair or restoration is not commenced within
thirty (30) days after receipt of such notice, this Lease shall terminate as of
the date specified in said notice. If Lessor or a Lender commences the repair
or restoration of the Premises within thirty (30) days after receipt of such
notice, this Lease shall continue in full force and effect. "Commence" as used
in this Paragraph shall mean either the unconditional authorization of the
preparation of the required plans, or the beginning of the actual work on the
Premises, whichever first occurs.
9.7 Hazardous Substance Conditions. If a Hazardous Substance
Condition occurs, unless Lessee is legally responsible therefor (in which case
Lessee shall make the investigation and remediation thereof required by
Applicable Law and this Lease shall continue in full force and effect, but
subject to Lessor's rights under Paragraph 13), Lessor may at Lessor's option
either (i) investigate and remediate such Hazardous Substance Condition, if
required, as soon as reasonably possible at Lessor's expense, in which event
this Lease shall continue in full force and effect, or (ii) if the estimated
cost to investigate and remediate such condition exceeds twelve (12) times the
then monthly Base Rent or $100,000, whichever is greater, give written notice
to Lessee within thirty (30) days after receipt by Lessor of knowledge of the
occurrence of such Hazardous Substance Condition of Lessor's desire to
terminate this Lease as of the date sixty (60) days following the giving of
such notice. In the event Lessor elects to give such notice of Xxxxxx's
intention to terminate this Lease, Lessee shall have the right within ten (10)
days after the receipt of such notice to give written notice to Lessor of
Xxxxxx's commitment to pay for the investigation and remediation of such
Hazardous Substance Condition totally at Lessee's expense and without
reimbursement from Lessor except to the extent of an amount equal to twelve
(12) times the then monthly Base Rent or $100,000, whichever is greater.
Lessee shall provide Lessor with the funds required of Lessee or satisfactory
assurance thereof within thirty (30) days following Xxxxxx's said commitment,
in such event this Lease shall continue in full force and effect, and Lessor
shall proceed to make such investigation and remediation as soon as reasonably
possible and the required funds are available. If Lessee does not give such
notice and provide the required funds or assurance thereof within the times
specified above, this Lease shall terminate as of the date specified in
Lessor's notice of termination. If a Hazardous Substance Condition occurs for
which Lessee is not legally responsible, there shall be abatement of Xxxxxx's
obligations under this Lease to the same extent as provided in Paragraph 9.6(a)
for a period of not to exceed twelve (12) months.
9.8 Termination-Advance Payments. Upon termination of this Lease
pursuant to this Paragraph 9, an equitable adjustment shall be made concerning
advance Base Rent and any other advance payments made by Lessee to Lessor.
Lessor shall, in addition, return to Lessee so much of Xxxxxx's Security
Deposit as has not been, or is not then required to be, used by Lessor under
the terms of this Lease.
9.9 Waive Statutes. Xxxxxx and Xxxxxx agree that the terms of this
Lease shall govern the effect of any damage to or destruction of the Premises
with respect to the termination of this Lease and hereby waive the provisions
of any present or future statute to the extent inconsistent herewith.
10. Real Property Taxes.
10.1 (a) Payment of Taxes. Lessee shall pay the Real Property Taxes,
as defined in Paragraph 10.2, applicable to the Premises during the term of
this Lease. Subject to Paragraph 10.1(b), all such payments shall be made at
least ten (10) days prior to the delinquency date of the applicable
installment. Lessee shall promptly furnish Lessor with satisfactory evidence
that such taxes have been paid. If any such taxes to be paid by Lessee shall
cover any period of time prior to or after the expiration or earlier
termination of the term hereof, Xxxxxx's share of such taxes shall be equitably
prorated to cover only the period of time within the tax fiscal year this Lease
is in effect, and Lessor shall reimburse Lessee for any overpayment after such
proration. If Lessee shall fail to pay any Real Property Taxes required by
this Lease to be paid by Xxxxxx, Lessor shall have the right to pay the same,
and Xxxxxx shall reimburse Lessor therefor upon demand.
(b) Advance Payment. In order to insure payment when due and
before delinquency of any or all Real Property Taxes, Lessor reserves the
right, at Lessor's option, to estimate the current Real Property Taxes
applicable to the Premises, and to require such current year's Real Property
Taxes to be paid in advance to Lessor by Lessee, monthly in advance with the
payment of the Base Rent. If Lessor elects to require payment monthly in
advance, the monthly payment shall be that equal monthly amount which, over the
number of months remaining before the month in which the applicable tax
installment would become delinquent (and without interest thereon), would
provide a fund large enough to fully discharge before delinquency the estimated
installment of taxes to be paid. When the actual amount of the applicable tax
bill is known, the amount of such equal monthly advance payment shall be
adjusted as required to provide the fund needed to pay the applicable taxes
before delinquency. If the amounts paid to Lessor by Lessee under the
provisions of this Paragraph are insufficient to discharge the obligations of
Lessee to pay such Real Property Taxes as the same become due, Lessee shall pay
to Lessor, upon Lessor's demand, such additional sums as are necessary to pay
such obligations. All moneys paid to Lessor under this Paragraph may be
intermingled with other moneys of Xxxxxx and shall not bear interest. In the
event of a Breach by Xxxxxx in the performance of the obligations of Lessee
under this Lease, then any balance of funds paid to Lessor under the provisions
of this Paragraph may, subject to proration as provided in Paragraph 10.1(a),
at the option of Lessor, be treated as an additional Security Deposit under
Paragraph 5.
10.2 Definition of "Real Property Taxes." As used herein, the term
"Real Property Taxes" 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 upon the Premises by any authority
having the direct or indirect power to tax, including any city state or federal
government, or any school, agricultural, sanitary, fire, street, drainage or
other improvement district thereof, levied against any legal or equitable
interest of Lessor in the Premises or in the real property of which the
Premises are a part, Lessor's right to rent or other income therefrom, and/or
Xxxxxx's business of leasing the Premises. The term "Real Property Taxes"
shall also include any tax, fee, levy, assessment or charge, or any increase
therein, imposed by reason of events occurring, or changes in applicable law
taking effect, during the term of this Lease, including but not limited to a
change in the ownership of the Premises or in the improvements thereon, the
execution of this Lease, or any modification, amendment or transfer thereof,
and whether or not contemplated by the Parties.
10.3 Joint Assessment. If the Premises are not separately assessed,
Xxxxxx's liability shall be an equitable proportion of the Real Property Taxes
for all of the land and improvements included within the tax parcel assessed,
such proportion to be determined by Lessor from the respective valuations
-----------------------------------------------------------------------------
assigned in the assessor's work sheets or such other information as may be
reasonably available. Lessor's reasonable determination thereof, in good
faith, shall be conclusive.
10.4 Personal Property Taxes. Lessee shall pay prior to delinquency
all taxes assessed against and levied upon Lessee Owned Alterations, Utility
Installations, Trade Fixtures, furnishings, equipment and all personal property
of Lessee contained in the Premises or elsewhere. When possible, Lessee shall
cause Its Trade Fixtures, furnishings, equipment and all other personal
property to be assessed and billed separately from the real property of Lessor.
If any of Xxxxxx's said personal property shall be assessed with Xxxxxx's real
property, Lessee shall pay Lessor the taxes attributable to Lessee within ten
(10) days after receipt of a written statement setting forth the taxes
applicable to Xxxxxx's property or, at Lessor's option, as provided in
Paragraph 10.1(b).
11. Utilities. Lessee shall pay for all water, gas, heat, light, power,
telephone, trash disposal and other utilities and services supplied to the
Premises, together with any taxes thereon. If any such services are not
separately metered to Lessee, Lessee shall pay a reasonable proportion, to be
determined by Lessor, of all charges jointly metered with other premises.
12. Assignment and Subletting.
12.1 Lessor's Consent Required.
(a) Lessee shall not voluntarily or by operation of law assign,
transfer, mortgage or otherwise transfer or encumber (collectively.
"assignment") or sublet all or any part of Xxxxxx's interest in this Lease or
in the Premises without Xxxxxx's prior written consent given under and subject
to the terms of Paragraph 36.
(b) A change in the control of Lessee shall constitute an
assignment requiring Xxxxxx's consent. The transfer, on a cumulative basis, of
__FIFTY-ONE PERCENT (51%)__ or more of the voting control of Lessee shall
constitute a change in control for this purpose.
(c) The involvement of Lessee or its assets in any transaction, or
series of transactions (by way of merger, sale, acquisition, financing,
refinancing, transfer, leveraged buy-out or otherwise), whether or not a formal
assignment or hypothecation of this Lease or Lessee's assets occurs, which
results or will result in a reduction of the Net Worth of Lessee, as
hereinafter defined, by an amount equal to or greater than twenty-five percent
(25%) of such Net Worth of Lessee as it was represented to Lessor at the time
of the execution by Lessor of this Lease or at the time of the most recent
assignment to which Lessor has consented, or as it exists immediately prior to
said transaction or transactions constituting such reduction, at whichever time
said Net Worth of Lessee was or is greater, shall be considered an assignment
of this Lease by Lessee to which Lessor may reasonably withhold its consent.
"Net Worth of Lessee" for purposes of this Lease shall be the net worth of
Lessee (excluding any guarantors) established under generally accepted
accounting principles consistently applied.
(d) An assignment or subletting of Xxxxxx's interest in this Lease
without Xxxxxx's specific prior written consent shall, at Lessor's option, be a
Default curable after notice per Paragraph 13.1(c), or a noncurable Breach
without the necessity of any notice and grace period. If Lessor elects to
treat such unconsented to assignment or subletting as a noncurable Breach,
Lessor shall have the right to either: (i) terminate this Lease, or (ii) upon
thirty (30) days written notice ("Lessor's Notice"), increase the monthly Base
Rent to fair market rental value or one hundred ten percent (110%) of the Base
Rent then in effect, whichever is greater. Pending determination of the new
fair market rental value, if disputed by Xxxxxx, Lessee shall pay the amount
set forth in Lessor's Notice, with any overpayment credited against the next
installment(s) of Base Rent coming due, and any underpayment for the period
retroactively to the effective date of the adjustment being due and payable
immediately upon the determination thereof. Further, in the event of such
Breach and market value adjustment, (i) the purchase price of any option to
purchase the Premises held by Lessee shall be subject to similar adjustment to
the then fair market value (without the Lease being considered an encumbrance
or any deduction for depreciation or obsolescence, and considering the Premises
at its highest and best use and in good condition), or one hundred ten percent
(110%) of the price previously in effect, whichever is greater, (ii) any index-
oriented rental or price adjustment formulas contained in this Lease shall be
adjusted to require that the base index be determined with reference to the
index applicable to the time of such adjustment, and (iii) any fixed rental
adjustments scheduled during the remainder of the Lease term shall be increased
in the same ratio as the new market rental bears to the Base Rent in effect
immediately prior to the market value adjustment.
(e) Xxxxxx's remedy for any breach of this Paragraph 12.1 by
Lessor shall be limited to compensatory damages and injunctive relief.
12.2 Terms and Conditions Applicable to Assignment and Subletting.
(a) Regardless of Lessor's consent, any assignment or subletting
shall not: (i) be effective without the express written assumption by such
assignee or sublessee of the obligations of Lessee under this Lease,
(ii) release Lessee of any obligations hereunder, or (iii) alter the primary
liability of Lessee for the payment of Base Rent and other sums due Lessor
hereunder or for the performance of any other obligations to be performed by
Lessee under this Lease.
(b) Lessor may accept any rent or performance of Xxxxxx's
obligations from any person other than Lessee pending approval or disapproval
of an assignment. Neither a delay in the approval or disapproval of such
assignment nor the acceptance of any rent or performance shall constitute a
waiver or estoppel of Lessor's right to exercise its remedies for the Default
or Breach by Xxxxxx of any of the terms, covenants or conditions of this Lease.
(c) The consent of Lessor to any assignment or subletting shall
not constitute a consent to any subsequent assignment or subletting by Xxxxxx
or to any subsequent or successive assignment or subletting by the sublessee.
However, Lessor may consent to subsequent sublettings and assignments of the
sublease or any amendments or modifications thereto without notifying Lessee or
anyone else liable on the Lease or sublease and without obtaining their
consent, and such action shall not relieve such persons from liability under
this Lease or sublease.
(d) In the event of any Default or Breach of Lessee's obligations
under this Lease, Lessor may proceed directly against Lessee, any Guarantors or
any one else responsible for the performance of the Lessee's obligations under
this Lease, including the sublessee, without first exhausting Lessor's remedies
against any other person or entity responsible therefor to Lessor, or any
security held by Lessor or Lessee.
(e) Each request for consent to an assignment or subletting shall
be in writing, accompanied by information relevant to Lessor's determination as
to the financial and operational responsibility and appropriateness of the
proposed assignee or sublessee, including but not limited to the intended use
and/or required modification of the Premises, if any, together with a non-
refundable deposit of $1,000 or ten percent (10%) of the current monthly Base
Rent, whichever is greater, as reasonable consideration for Lessor's
considering and processing the request for consent. Xxxxxx agrees to provide
Lessor with such other or additional information and/or documentation as may be
reasonably requested by Xxxxxx.
(f) Any assignee of, or sublessee under, this Lease shall, by
reason of accepting such assignment or entering into such sublease, be deemed,
for the benefit of Lessor, to have assumed and agreed to conform and comply
with each and every term, covenant, condition and obligation herein to be
observed or performed by Lessee during the term of said assignment or sublease,
other than such obligations as are contrary to or inconsistent with provisions
of an assignment or sublease to which Lessor has specifically consented in
writing.
(g) The occurrence of a transaction described in Paragraph 12.1(c)
shall give Lessor the right (but not the obligation) to require that the
Security Deposit be increased to an amount equal to __THREE (3) TIMES__ the
then monthly Base Rent, and Lessor may make the actual receipt by Lessor of the
amount required to establish such Security Deposit a condition to Lessor's
consent to such transaction.
(h)
12.3 Additional Terms and Conditions Applicable to Subletting. The
following terms and conditions shall apply to any subletting by Lessee of all
or any part of the Premises and shall be deemed included in all subleases under
this Lease whether or not expressly incorporated therein:
(a) Lessee hereby assigns and transfers to Lessor all of Lessee's
interest in all rentals and income arising from any sublease of all or a
portion of the Premises heretofore or hereafter made by Lessee, and Lessor may
collect such rent and income and apply same toward Lessee's obligations under
this Lease; provided, however, that until a Breach (as defined in Paragraph
13.1) shall occur in the performance of Lessee's obligations under this Lease,
Lessee may, except as otherwise provided in this Lease, receive, collect and
enjoy the rents accruing under such sublease. Lessor shall not, by reason of
this or any other assignment of such sublease to Lessor, nor by reason of the
collection of the rents from a sublessee, be deemed liable to the sublessee for
any failure of Lessee to perform and comply with any of Lessee's obligations to
such sublessee under such sublease. Lessee hereby irrevocably authorizes and
directs any such sublessee, upon receipt of a written notice from Xxxxxx
stating that a Breach exists in the performance of Xxxxxx's obligations under
this Lease, to pay to Lessor the rents and other charges due and to become due
under the sublease. Sublessee shall rely upon any such statement and request
from Lessor and shall pay such rents and other charges to Lessor without any
obligation or right to inquire as to whether such Breach exists and
notwithstanding any notice from or claim from Lessee to the contrary Lessee
shall have no right or claim against said sublessee, or, until the Breach has
been cured, against Lessor, for any such rents and other charges so paid by
said sublessee to Lessor.
(b) In the event of a Breach by Lessee in the performance of its
obligations under this Lease, Lessor, at its option and without any obligation
to do so, may require any sublessee to attorn to Lessor, in which event Lessor
shall undertake the obligations of the sublessor under such sublease from the
time of the exercise of said option to the expiration of such sublease;
provided, however, Lessor shall not be liable for any prepaid rents or security
deposit paid by such sublessee to such sublessor or for any other prior
Defaults or Breaches of such sublessor under such sublease.
(c) Any matter or thing requiring the consent of the sublessor
under a sublease shall also require the consent of Lessor herein.
(d) No sublessee shall further assign or sublet all or any part of
the Premises without Lessor's prior written consent.
(e) Lessor shall deliver a copy of any notice of Default or Breach
by Xxxxxx to the sublessee, who shall have the right to cure the Default of
Lessee within the grace period, if any, specified in such notice. The
sublessee shall have a right of reimbursement and offset from and against
Xxxxxx for any such Defaults cured by the sublessee.
13. Default; Breach; Remedies.
13.1 Default; Breach. Xxxxxx and Lessee agree that if an attorney is
consulted by Lessor in connection with a Lessee Default or Breach (as
hereinafter defined), $350.00 is a reasonable minimum sum per such occurrence
for legal services and costs in the preparation and service of a notice of
Default, and that Lessor may include the cost of such services and costs in
said notice as rent due and payable to cure said Default. A "Default" is
defined as failure by the Lessee to observe, comply with or perform any of the
terms, covenants, conditions or rules applicable to Lessee under this Lease.
-----------------------------------------------------------------------------
A "Breach" is defined as the occurrence of any one or more of the following
Defaults, and, where a grace period forfeiture after notice is specified
herein, the failure by Xxxxxx to cure such Default prior to the expiration of
the applicable grace period, shall entitle Lessor to pursue the remedies set
forth in Paragraphs 13.2 and/or 13.3:
(a) The vacating of the Premises without the intention to reoccupy
same, or the abandonment of the Premises.
(b) Except as expressly otherwise provided in this Lease, the
failure by Lessee to make any payment of Base Rent or any other monetary
payment required to be made by Lessee hereunder, whether to Lessor or to a
third party, as and when due, the failure by Lessee to provide Lessor with
reasonable evidence of insurance or surety bond required under this Lease, or
the failure of Lessee to fulfill any obligation under this Lease which
endangers or threatens life or property, where such failure continues for a
period of three (3) days following written notice thereof by or on behalf of
Lessor to Xxxxxx.
(c) Except as expressly otherwise provided in this Lease, the
failure by Lessee to provide Lessor with reasonable written evidence (in duly
executed original form, if applicable) of (i) compliance with Applicable Law
per Paragraph 6.3. (ii) the inspection, maintenance and service contracts
required under Paragraph 7.1(b), (iii) the recission of an unauthorized
assignment or subletting per Paragraph 12.1(b), (iv) a Tenancy Statement per
Paragraphs 16 or 37, (v) the subordination or non-subordination of this Lease
per Paragraph 30, (vi) the guaranty of the performance of Lessee's obligations
under this Lease if required under Paragraphs 1.11 and 37, (vii) the execution
of any document requested under Paragraph 42 (easements), or (viii) any other
documentation or information which Lessor may reasonably require of Lessee
under the terms of this Lease, where any such failure continues for a period of
ten (10) days following written notice by or on behalf of Lessor to Xxxxxx.
(d) A Default by Lessee as to the terms, covenants, conditions or
provisions of this Lease, or of the rules adopted under Paragraph 40 hereof,
that are to be observed, complied with or performed by Xxxxxx, other than those
described in subparagraphs (a), (b) or (c), above, where such Default continues
for a period of thirty (30) days after written notice thereof by or on behalf
of Lessor to Lessee; provided, however, that if the nature of Xxxxxx's Default
is such that more than thirty (30) days are reasonably required for its cure,
then it shall not be deemed to be a Breach of this Lease by Lessee if Lessee
commences such cure within said thirty (30) day period and thereafter
diligently prosecutes such cure to completion.
(e) The occurrence of any of the following events: (i) The making
by lessee of any general arrangement or assignment for the benefit of
creditors; (ii) Xxxxxx's becoming a "debtor" as defined in 11 U.S.C. SS101 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 of Xxxxxx'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; provided,
however, in the event that any provision of this subparagraph (e) is contrary
to any applicable law, such provision shall be of no force or effect, and not
affect the validity of the remaining provisions.
(f) The discovery by Lessor that any financial statement given to
Lessor by Lessee or any Guarantor of Xxxxxx's obligations hereunder was
materially false.
(g)
13.2 Remedies. If Lessee fails to perform any affirmative duty or
obligation of Lessee under this Lease, within ten (10) days after written
notice to Lessee (or in case of an emergency, without notice), Lessor may at
its option (but without obligation to do so), perform such duty or obligation
on Lessee's behalf, including but not limited to the obtaining of reasonably
required bonds, insurance policies, or governmental licenses, permits or
approvals. The costs and expenses of any such performance by Lessor shall be
due and payable by Lessee to Lessor upon invoice therefor. If any check given
to Lessor by Lessee shall not be honored by the bank upon which it is drawn,
Lessor, at its option, may require all future payments to be made under this
Lease by Lessee to be made only by cashier's check. In the event of a Breach
of this Lease by Xxxxxx, as defined in Paragraph 13.1, with or without further
notice or demand, and without limiting Lessor in the exercise of any right or
remedy which Lessor may have by reason of such Breach, Lessor may:
(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: (i) the worth at
the time of the award of the unpaid rent which had been earned at the time of
termination; (ii) the worth at the time of award of the amount by which the
unpaid rent which would have been earned after termination until the time of
award exceeds the amount of such rental loss that the Lessee proves could have
been reasonably avoided; (iii) the worth at the time of award of the amount by
which the unpaid rent for the balance of the term after the time of award
exceeds the amount of such rental loss that the Lessee proves could be
reasonably avoided; and (iv) any other amount necessary to compensate Lessor
for all the detriment proximately caused by the Lessee's failure to perform its
obligations under this Lease or which in the ordinary course of things would be
likely to result therefrom, including but not limited to the cost of recovering
possession of the Premises, expenses of reletting, including necessary
renovation and alteration of the Premises, reasonable attorneys' fees, and that
portion of the leasing commission paid by Lessor applicable to the unexpired
term of this Lease. The worth at the time of award of the amount referred to
in provision (iii) of the prior sentence shall be computed by discounting such
amount at the discount rate of the Federal Reserve Bank of San Francisco at the
time of award plus one percent (1%). Efforts by Lessor to mitigate damages
caused by Xxxxxx's Default or Breach of this Lease shall not waive Lessor's
right to recover damages under this Paragraph. If termination of this Lease is
obtained through the provisional remedy of unlawful detainer, Lessor shall have
the right to recover in such proceeding the unpaid rent and damages as are
recoverable therein, or Lessor may reserve therein the right to recover all or
any part thereof in a separate suit for such rent and/or damages. If a notice
and grace period required under subparagraphs 13.1(b), (c) or (d) was not
previously given, a notice to pay rent or quit, or to perform or quit, as the
case may be, given to Lessee under any statute authorizing the forfeiture of
leases for unlawful detainer shall also constitute the applicable notice for
grace period purposes required by subparagraphs 13.1(b), (c) or (d). In such
case, the applicable grace period under subparagraphs 13.1(b), (c) or (d) and
under the unlawful detainer statute shall run concurrently after the one such
statutory notice, and the failure of Lessee to cure the Default within the
greater of the two such grace periods shall constitute both an unlawful
detainer and a Breach of this Lease entitling Lessor to the remedies provided
for in this Lease and/or by said statute.
(b) Continue the Lease and Xxxxxx's right to possession in effect
(in California under California Civil Code Section 1951.4) after Xxxxxx's
Breach and abandonment and recover the rent as it becomes due, provided Xxxxxx
has the right to sublet or assign, subject only to reasonable limitations. See
Paragraphs 12 and 36 for the limitations on assignment and subletting which
limitations Lessee and Lessor agree are reasonable. Acts of maintenance or
preservation, efforts to relet the Premises, or the appointment of a receiver
to protect the Lessor's interest under the Lease, shall not constitute a
termination of the Lessee's right to possession.
(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.
(d) The expiration or termination of this Lease and/or the
termination of Xxxxxx's right to possession shall not relieve Lessee from
liability under any indemnity provisions of this Lease as to matters occurring
or accruing during the term hereof or by reason of Xxxxxx's occupancy of the
Premises.
13.3 Inducement Recapture In Event Of Breach. Any agreement by Lessor
for free or abated rent or other charges applicable to the Premises, or for the
giving or paying by Lessor to or for Lessee of any cash or other bonus,
inducement or consideration for Xxxxxx's entering into this Lease, all of which
concessions are hereinafter referred to as "Inducement Provisions;" shall be
deemed conditioned upon Xxxxxx's full and faithful performance of all of the
terms, covenants and conditions of this Lease to be performed or observed by
Lessee during the term hereof as the same may be extended. Upon the occurrence
of a Breach of this Lease by Xxxxxx, as defined in Paragraph 13.1, any such
inducement Provision shall automatically be deemed deleted from this Lease and
of no further force or effect, and any rent, other charge, bonus, inducement or
consideration theretofore abated, given or paid by Lessor under such an
Inducement Provision shall be immediately due and payable by Lessee to Lessor,
and recoverable by Lessor as additional rent due under this Lease,
notwithstanding any subsequent cure of said Breach by Lessee. The acceptance
by Lessor of rent or the cure of the Breach which initiated the operation of
this Paragraph shall not be deemed a waiver by Lessor of the provisions of this
Paragraph unless specifically so stated in writing by Lessor at the time of
such acceptance.
13.4 Late Charges. Lessee hereby acknowledges that late payment by
Xxxxxx to Lessor of rent and 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 upon
Lessor by the terms of any ground lease, mortgage or trust deed covering the
Premises. Accordingly, if any installment of rent 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 six percent
(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 Xxxxxx. Acceptance of such late charge by Lessor
shall in no event constitute a waiver of Xxxxxx's Default or Breach with
respect to such overdue amount, nor prevent Xxxxxx from exercising any of the
other rights and remedies granted hereunder. In the event that a late charge
is payable hereunder, whether or not collected, for three (3) consecutive
installments of Base Rent, then notwithstanding Paragraph 4.1 or any other
provision of this Lease to the contrary, Base Rent shall, at Lessor's option,
become due and payable quarterly in advance.
13.5 Breach by Lessor. Lessor shall not be deemed in breach of this
Lease unless Lessor fails within a reasonable time to perform an obligation
required to be performed by Xxxxxx. For purposes of this Paragraph 13.5, a
reasonable time shall in no event be less than thirty (30) days after receipt
by Lessor, and by the holders of any ground lease, mortgage or deed of trust
covering the Premises whose name and address shall have been furnished Lessee
in writing for such purpose, of written notice specifying wherein such
obligation of Lessor has not been performed; provided, however, that if the
nature of Lessor's obligation is such that more than thirty (30) days after
such notice are reasonably required for its performance, then Lessor shall not
be in breach of this Lease if performance is commenced within such thirty (30)
day period and thereafter diligently pursued to completion.
14. Condemnation. If the Premises or any portion thereof are taken under the
power of eminent domain or sold under the threat of the exercise of said power
(all of which are herein called "condemnation"), this Lease shall terminate as
to the part so taken as of the date the condemning authority takes title or
-----------------------------------------------------------------------------
possession, whichever first occurs. If more than ten percent (10%) of the
floor area of the Premises, or more than twenty-five percent (25%) of the land
area not occupied by any building, is taken by condemnation, Lessee may, at
Lessee's option, to be exercised in writing within ten (10) days after Lessor
shall have given Lessee written notice of such taking (or in the absence of
such notice, within ten (10) days after the condemning authority shall have
taken possession) terminate this Lease as of the date the condemning authority
takes such possession. If Xxxxxx does not terminate this Lease in accordance
with the foregoing, this Lease shall remain in full force and effect as to the
portion of the Premises remaining, except that the Base Rent shall be reduced
in the same proportion as the rentable floor area of the Premises taken bears
to the total rentable floor area of the building located on the Premises. No
reduction of Base Rent shall occur if the only portion of the Premises taken is
land on which there is no building. Any award for the taking of all or any
part of the Premises under the power of eminent domain or any payment made
under threat of the exercise of such power shall be the property of 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 compensation separately awarded
to Lessee for Lessee's relocation expenses and/or loss of Lessee's Trade
Fixtures. In the event that this Lease is not terminated by reason of such
condemnation, Lessor shall to the extent of its net severance damages received,
over and above the legal and other expenses incurred by Xxxxxx in the
condemnation matter, repair any damage to the Premises caused by such
condemnation, except to the extent that Xxxxxx has been reimbursed therefor by
the condemning authority. Lessee shall be responsible for the payment of any
amount in excess of such net severance damages required to complete such
repair.
15. Broker's Fee.
15.1 The Brokers named in Paragraph 1.10 are the procuring causes of
this Lease.
15.2 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 written agreement between Xxxxxx
and said Brokers (or in the event there is no separate written agreement
between Xxxxxx and said Brokers, the sum of $ __PER AGREEMENT__ ) for brokerage
services rendered by said Brokers to Lessor in this transaction.
15.3 Unless Lessor and Brokers have otherwise agreed in writing, Xxxxxx
further agrees that: (a) if Lessee exercises any Option (as defined in
Paragraph 39.1) or any Option subsequently granted which is substantially
similar to an Option granted to Lessee in this Lease, or (b) 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 (c) if Lessee remains in possession of the
Premises, with the consent of Lessor, after the expiration of the term of this
Lease after having failed to exercise an Option, or (d) if said Brokers 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 (e) if Base Rent is increased, whether by agreement or operation
of an escalation clause herein, then as to any of said transactions, Xxxxxx
shall pay said Brokers a fee in accordance with the schedule of said Xxxxxxx in
effect at the time of the execution of this Lease.
15.4 Any buyer or transferee of Xxxxxx's interest in this Lease,
whether such transfer is by agreement or by operation of law, shall be deemed
to have assumed Xxxxxx's obligation under this Paragraph 15. Each Broker shall
be a third party beneficiary of the provisions of this Paragraph 15 to the
extent of its interest in any commission arising from this Lease and may
enforce that right directly against Xxxxxx and its successors.
15.5 Lessee and Lessor each represent and warrant to the other that it
has had no dealings with any person, firm, broker or finder (other than the
Brokers, if any named in Paragraph 1.10) in connection with the negotiation of
this Lease and/or the consummation of the transaction contemplated hereby, and
that no broker or other person, firm or entity other than said named Brokers is
entitled to any commission or finder's fee in connection with said transaction.
Xxxxxx and Xxxxxx do each hereby agree to indemnify, protect, defend and hold
the other harmless from and against 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, including any
costs, expenses, attorneys' fees reasonably incurred with respect thereto.
15.6 Lessor and Lessee hereby consent to and approve all agency
relationships, including any dual agencies, indicated in Paragraph 1.10.
16. Tenancy Statement.
16.1 Each Party (as "Responding Party") shall within ten (10) days
after written notice from the other Party (the "Requesting Party") execute,
acknowledge and deliver to the Requesting Party a statement in writing in form
similar to the then most current "`Tenancy Statement" form published by the
American Industrial Real Estate Association, plus such additional information,
confirmation and/or statements as may be reasonably requested by the Requesting
Party.
16.2 If Lessor desires to finance, refinance, or sell the Premises, any
part thereof, or the building of which the Premises are a part, Lessee and all
Guarantors of Xxxxxx's performance hereunder shall deliver to any potential
lender or purchaser designated by Lessor such financial statements of Lessee
and such Guarantors as may be reasonably required by such lender or purchaser,
including but not limited to Lessee's financial statements for the past three
(3) years. 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 the
owner or owners at the time in question of the fee title to the Premises, or,
if this is a sublease, of the Lessee's interest in the prior lease. In the
event of a transfer of Xxxxxx's title or interest in the Premises or in this
Lease, Lessor shall deliver to the transferee or assignee (in cash or by
credit) any unused Security Deposit held by Xxxxxx at the time of such transfer
or assignment. Except as provided in Paragraph 15, upon such transfer or
assignment and delivery of the Security Deposit, as aforesaid, the prior Lessor
shall be relieved of all liability with respect to the obligations and/or
covenants under this Lease thereafter to be performed by the Lessor. Subject
to the foregoing, the obligations and/or covenants in this Lease to be
performed by the Lessor shall be binding only upon the Lessor as hereinabove
defined.
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. Any monetary payment due Lessor
hereunder, other than late charges, not received by Lessor within thirty (30)
days following the date on which it was due, shall bear interest from the
thirty-first (31st) day after it was due at the rate of 12% per annum, but not
exceeding the maximum rate allowed by law, in addition to the late charge
provided for in Paragraph 13.4.
20. Time of Essence. Time is of the essence with respect to the performance
of all obligations to be performed or observed by the Parties under this Lease.
21. Rent Defined. All monetary obligations of Lessee to Lessor under the
terms of this Lease are deemed to be rent.
22. No Prior or Other Agreements; Broker Disclaimer. This Lease contains all
agreements between the Parties with respect to any matter mentioned herein, and
no other prior or contemporaneous agreement or understanding shall be
effective. Lessor and Lessee each represents and warrants to the Brokers that
it has made, and is relying solely upon, its own investigation as to the
nature, quality, character and financial responsibility of the other Party to
this Lease and as to the nature, quality and character of the Premises.
Brokers have no responsibility with respect thereto or with respect to any
default or breach hereof by either Party.
23. Notices.
23.1 All notices required or permitted by this Lease shall be in
writing and may be delivered in person (by hand or by messenger or courier
service) or may be sent by regular, certified or registered mail or U.S. Postal
Service Express Mail, with postage prepaid, or by facsimile transmission, and
shall be deemed sufficiently given if served in a manner specified in this
Paragraph 23. The addresses noted adjacent to a Party's signature on this
Lease shall be that Party's address for delivery or mailing of notice purposes.
Either Party may by written notice to the other specify a different address for
notice purposes, except that upon Xxxxxx's taking possession of the Premises,
the Premises shall constitute Xxxxxx's address for the purpose of mailing or
delivering notices to Lessee. 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 written notice to Xxxxxx.
23.2 Any notice sent by registered or certified mail, return receipt
requested, shall be deemed given on the date of delivery shown on the receipt
card, or if no delivery date is shown, the postmark thereon, if sent by regular
mail the notice shall be deemed given forty-eight (48) hours after the same is
addressed as required herein and mailed with postage prepaid. Notices
delivered by United States Express Mail or overnight courier that guarantees
next day delivery shall be deemed given twenty-four (24) hours after delivery
of the same to the United States Postal Service or courier. If any notice is
transmitted by facsimile transmission or similar means, the same shall be
deemed served or delivered upon telephone confirmation of receipt of the
transmission thereof, provided a copy is also delivered via delivery or mail.
If notice is received on a Sunday or legal holiday, it shall be deemed received
on the next business day.
24. Waivers. No waiver by Lessor of the Default or Breach of any term,
covenant or condition hereof by Lessee, shall be deemed a waiver of any other
term, covenant or condition hereof, or of any subsequent Default or Breach by
Lessee of the same or of any other term, covenant or condition hereof.
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 or similar act by Lessee, or be construed as the basis of an
estoppel to enforce the provision or provisions of this Lease requiring such
consent. Regardless of Xxxxxx's knowledge of a Default or Breach at the time
of accepting rent, the acceptance of rent by Lessor shall not be a waiver of
any preceding Default or Breach by Lessee of any provision hereof, other than
the failure of Lessee to pay the particular rent so accepted. Any payment
given Lessor by Lessee may be accepted by Lessor on account of moneys or
damages due Lessor, notwithstanding any qualifying statements or conditions
made by Lessee in connection therewith, which such statements and/or conditions
shall be of no force or effect whatsoever unless specifically agreed to in
writing by Lessor at or before the time of deposit of such payment.
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. The Party requesting recordation shall be
responsible for payment of any fees or taxes applicable thereto.
26. Right To Holdover. __LESSOR AGREES TO ALLOW XXXXXX TO HOLD OVER AND PAY
A MONTHLY RENT 125% OF THE THEN PREVAILING MARKET RENT AS THE NEW RENT DURING
THE HOLD OVER PERIOD. THE MAXIMUM TIME THAT XXXXXX WILL BE ABLE TO HOLD OVER
IS THREE MONTHS.__
-----------------------------------------------------------------------------
27. Cumulative Remedies. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other remedies
at law or in equity.
28. Covenants and Conditions. All provisions of this Lease to be observed or
performed by Lessee are both covenants and conditions.
29. Binding Effect; Choice of Law. This Lease shall be binding upon the
parties, their personal representatives, successors and assigns and be governed
by the laws of the State in which the Premises are locate. Any litigation
between the Parties hereto concerning this Lease shall be initiated in the
county in which the Premises are located.
30. Subordination; Attornment; Non-Disturbance.
30.1 Subordination. This Lease and any Option granted hereby shall be
subject and subordinate to any ground lease, mortgage, deed of trust, or other
hypothecation or security device (collectively, "Security Device"), now or
hereafter placed by Lessor upon the real property of which the Premises are a
part, to any and all advances made on the security thereof, and to all
renewals, modifications, consolidations, replacements and extensions thereof.
Xxxxxx agrees that the Lenders holding any such Security Device shall have no
duty, liability or obligation to perform any of the obligations of Lessor under
this Lease, but that in the event of Lessor's default with respect to any such
obligation, Lessee will give any Lender whose name and address have been
furnished Lessee in writing for such purpose notice of Lessor's default and
allow such Lender thirty (30) days following receipt of such notice for the
cure of said default before invoking any remedies Lessee may have by reason
thereof. If any Lender shall elect to have this Lease and/or any Option
granted hereby superior to the lien of its Security Device and shall give
written notice thereof to Lessee, this Lease and such Options shall be deemed
prior to such Security Device, notwithstanding the relative dates of the
documentation or recordation thereof.
30.2 Attornment. Subject to the non-disturbance provisions of
Paragraph 30.3, Xxxxxx agrees to attorn to a Lender or any other party who
acquires ownership of the Premises by reason of a foreclosure of a Security
Device, and that in the event of such foreclosure, such new owner shall not:
(i) be liable for any act or omission of any prior lessor or with respect to
events occurring prior to acquisition of ownership, (ii) be subject to any
offsets or defenses which Lessee might have against any prior lessor, or
(iii) be bound by prepayment of more than one (1) month's rent.
30.3 Non-Disturbance. With respect to Security Devices entered into by
Lessor after the execution of this Lease, Xxxxxx's subordination of this Lease
shall be subject to receiving assurance (a "non-disturbance agreement") from
the Lender that Xxxxxx's possession and this Lease, including any options to
extend the term hereof, will not be disturbed so long as Lessee is not in
Breach hereof and attorns to the record owner of the Premises.
30.4 Self-Executing. The agreements contained in this Paragraph 30
shall be effective without the execution of any further documents; provided,
however, that, upon written request from Lessor or a Lender in connection with
a sale, financing or refinancing of the Premises, Lessee and Lessor shall
execute such further writings as may be reasonably required to separately
document any such subordination or non-subordination, attornment and/or non-
disturbance agreement as is provided for herein.
31. Attorney's Fees. If any Party or Broker brings an action or proceeding
to enforce the terms hereof or declare rights hereunder, the Prevailing Party
(as hereafter defined) or Broker in any such proceeding, action, or appeal
thereon, shall be entitled to reasonable attorney's fees. Such fees may be
awarded in the same suit or recovered in a separate suit, whether or not such
action or proceeding is pursued to decision or judgment. The term, "Prevailing
Party" shall include, without limitation, a Party or Broker who substantially
obtains or defeats the relief sought, as the case may be, whether by
compromise, settlement, judgment, or the abandonment by the other Party or
Broker of its claim or defense. The attorney's fees award shall not be
computed in accordance with any court fee schedule, but shall be such as to
fully reimburse all attorney's fees reasonably incurred. Lessor shall be
entitled to attorney's fees, costs and expenses incurred in the preparation and
service of notices of Default and consultations in connection here, whether or
not a legal action is subsequently commenced in connection with such Default or
resulting Breach.
32. Lessor's Access; Showing Premises; Repairs. Lessor and Xxxxxx's agents
shall have the right to enter with twenty-four (24) hours notice the Premises
at any time, in the case of an emergency, and otherwise at reasonable times for
the purpose of showing the same to prospective purchasers, lenders, or lessees,
and making such alterations, repairs, improvements or additions to the Premises
or to the building of which they are a part, as Lessor may reasonably deem
necessary. Lessor may at any time place on or about the Premises or building
any ordinary "For Sale" signs and Lessor may at any time during the last one
hundred twenty (120) days of the term hereof place on or about the Premises any
ordinary "For Lease" signs. All such activities of Lessor shall be without
abatement of rent or liability to Lessee.
33. Auctions. Lessee shall not conduct, nor permit to be conducted, either
voluntarily or involuntarily, any auction upon the Premises without first
having obtained Xxxxxx'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.
34. Signs. Lessee shall not place any sign upon the Premises, except that
Lessee may, with Xxxxxx's prior written consent, install (but not on the roof)
such signs as are reasonably required to advertise Xxxxxx's own business. The
installation of any sign on the Premises by or for Lessee shall be subject to
the provisions of Paragraph 7 (Maintenance, Repairs, Utility Installations,
Trade Fixtures and Alterations). Unless otherwise expressly agreed herein,
Lessor reserves all rights to the use of the roof and the right to install, and
all revenues from the installation of, such advertising signs on the Premises,
including the roof, as do not unreasonably interfere with the conduct of
Xxxxxx's business.
35. Termination; Merger. Unless specifically stated otherwise in writing by
Lessor, the voluntary or other surrender of this Lease by Xxxxxx, the mutual
termination or cancellation hereof, or a termination hereof by Lessor for
Breach by Lessee, shall automatically terminate any sublease or lesser estate
in the Premises; provided, however, Lessor shall in the event of any such
surrender, termination or cancellation, have the option to continue any one or
all of any existing subtenancies. Lessor's failure within ten (10) days
following any such event to make a written election to the contrary by written
notice to the holder of any such lesser interest, shall constitute Lessor's
election to have such event constitute the termination of such interest.
36. Consents.
(a) Except for Paragraph 33 hereof (Auctions) or as otherwise
provided herein, wherever in this Lease the consent of a Party is required to
an act by or for the other Party, such consent shall not be unreasonably
withheld or delayed. Lessor's actual reasonable costs and expenses (including
but not limited to architects', attorneys', engineers' or other consultants'
fees) incurred in the consideration of, or response to, a request by Lessee for
any Lessor consent pertaining to this Lease or the Premises, including but not
limited to consents to an assignment, a subletting or the presence or use of a
Hazardous Substance, practice or storage tank, shall be paid by Lessee to
Lessor upon receipt of an invoice add supporting documentation therefor.
Subject to Paragraph 12.2(e) (applicable to assignment or subletting), Lessor
may, as a condition to considering any such request by Lessee, require that
Lessee deposit with Lessor an amount of money (in addition to the Security
Deposit held under Paragraph 5) reasonably calculated by Lessor to represent
the cost Lessor will incur in considering and responding to Xxxxxx's request.
Except as otherwise provided, any unused portion of said deposit shall be
refunded to Lessee without interest. Xxxxxx's consent to any act, assignment
of this Lease or subletting of the Premises by Lessee shall not constitute an
acknowledgement that no Default or Breach by Lessee of this Lease exists, nor
shall such consent be deemed a waiver of any then existing Default or Breach,
except as may be otherwise specifically stated in writing by Lessor at the time
of such consent.
(b) All conditions to Lessor's consent authorized by this Lease
are acknowledged by Xxxxxx as being reasonable. The failure to specify herein
any particular condition to Xxxxxx's consent shall not preclude the imposition
by Xxxxxx at the time of consent of such further or other conditions as are
then reasonable with reference to the particular matter for which consent is
being given.
37. Guarantor.
38. Quiet Possession. Upon payment by Xxxxxx of the rent for the Premises
and the observance and performance of all of the covenants, conditions and
provisions on Xxxxxx's part to be observed and performed under this Lease,
Lessee shall have quiet possession of the Premises for the entire term hereof
subject to all of the provisions of this Lease.
39. Options.
39.1 Definition. As used in this Paragraph 39 the word "Option" has
the following meaning: (a) the right 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; (b) the right of first refusal to lease the Premises or the
right of first offer to lease the Premises or the right of first refusal to
lease other property of Lessor or the right of first offer to lease other
property of Lessor; (c) the right to purchase the Premises, or the right of
first refusal to purchase the Premises, or the right of first offer to purchase
the Premises, or the right 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 To Original Lessee. Each Option granted to
Lessee in this Lease is personal to the original Lessee named in Paragraph 1.1
hereof, and cannot be voluntarily or involuntarily assigned or exercised by any
person or entity other than said original Lessee while the original Lessee is
in full and actual possession of the Premises and without the intention of
thereafter assigning or subletting. The Options, if any, herein granted to
Lessee are not assignable, either as a part of an assignment of this Lease or
separately or apart therefrom, and no Option may be separated from this Lease
in any manner, 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 Options to extend or renew this Lease have been validly
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 period commencing with the giving of any notice of Default under
Paragraph 13.1 and continuing until the noticed Default is cured, or (ii)
during the period of time any monetary obligation due Lessor from Lessee is
unpaid (without regard to whether notice thereof is given Lessee), or
(iii) during the time Lessee is in Breach of this Lease, or (iv) in the event
that Lessor has given to Lessee three (3) or more notices of Default under
Paragraph 13.1, whether or not the Defaults are cured, during the twelve (12)
month period immediately preceding the exercise of the Option.
(b) The period of time within which an Option may be exercised
shall not be extended or enlarged by reason of Xxxxxx'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 (30) days after such obligation becomes due
(without any necessity of Lessor to give notice thereof to Lessee), or
(ii) Lessor gives to Lessee three (3) or more notices of Default under
Paragraph 13.1 during any twelve (12) month period, whether or not the Defaults
are cured, or (iii) if Lessee commits a Breach of this Lease. __SEE ADDENDUM
FOR PARAGRAPH 39.5 AND 39.6.__
40. Multiple Buildings. If the Premises are part of a group of buildings
controlled by Lessor, Xxxxxx agrees that it will abide by, keep and observe all
reasonable rules and regulations which Lessor may make from time to time for
the management, safety, care, and cleanliness of the grounds, the parking and
unloading of vehicles and the preservation of good order, as well as for the
convenience of other occupants or tenants of such other buildings and their
invitees, and that Lessee will pay its fair share of common expenses incurred
in connection therewith.
41. Security Measures. Lessee hereby acknowledges that the rental payable to
Lessor hereunder does not include the cost of guard service or other security
measures, and that Lessor shall have no obligation whatsoever to provide same.
Lessee assumes all responsibility for the protection of the Premises, Lessee,
its agents and invitees and their property from the acts of third parties.
42. Reservations. Lessor reserves to itself the right, from time to time, to
grant, without the consent or joinder of Lessee, such easements, rights and
dedications that Lessor deems necessary, 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
Xxxxxx. Xxxxxx agrees to sign any documents reasonably requested by Lessor to
effectuate any such easement rights, dedication, map or restrictions.
43. 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.
44. Authority. If either Party hereto is a corporation, trust, or general or
limited partnership, each individual executing this Lease on behalf of such
entity represents and warrants that he or she is duly authorized to execute and
deliver this Lease on its behalf. If Lessee is a corporation, trust or
partnership, Lessee shall, within thirty (30) days after request by Xxxxxx,
deliver to Lessor evidence satisfactory to Lessor of such authority.
45. Conflict. Any conflict between the printed provisions of this Lease and
the typewritten or handwritten provisions shall be controlled by the
typewritten or handwritten provisions.
46. Offer. Preparation of this Lease by Lessor or Xxxxxx's agent and
submission of same to Lessee shall not be deemed an offer to lease to Lessee.
This Lease is not intended to be binding until executed by all Parties hereto.
47. Amendments. This Lease may be modified only in writing, signed by the
Parties in interest at the time of the modification. The parties shall amend
this Lease from time to time to reflect any adjustments that are made to the
Base Rent or other rent payable under this Lease. As long as they do not
materially change Xxxxxx's obligations hereunder, Xxxxxx agrees to make such
reasonable non-monetary modifications to this Lease as may be reasonably
required by an institutional insurance company, or pension plan Lender in
connection with the obtaining of normal financing or refinancing of the
property of which the Premises are a part.
48. Multiple Parties. Except as otherwise expressly provided herein, if more
than one person or entity is named herein as either Lessor or Lessee, the
obligations of such Multiple Parties shall be the joint and several
responsibility of all persons or entities named herein as such Lessor or
Lessee. __SEE ADDENDUM FOR PARAGRAPH 1.2 (CONTINUED), 1.3 (CONTINUED), 1.5
(CONTINUED), 1.7 (CONTINUED), 2.1 (CONTINUED), 2.3 (CONTINUED), 7.4(b)
(CONTINUED), 39.5, 39.6, 49, AND 50.__
Lessor and Xxxxxx have carefully read and reviewed this lease and
each term and provision contained herein, and by the 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.
Further, experts should be consulted to evaluate the
condition of the property as to the possible presence
of asbestos, storage tanks or hazardous substances.
No representation or recommendation is made by the
American Industrial Real Estate Association or by the
real estate broker(s) or their agents or employees as
to the legal sufficiency, legal effect, or tax
consequences of this lease or the transaction to which
it relates; the parties shall rely solely upon the
advice of their own counsel as to the legal and tax
consequences of this lease. If the subject property
is located in a state other than California, an
attorney from the state where the property is located
should be consulted.
The parties hereto have, executed this Lease at the place on the
dates specified above to their respective signatures.
Executed at __VISTA, CALIFORNIA__ Executed at __CARLSBAD, CALIFORNIA__
on ___________JANUARY 1, 1998____ on ___________JANUARY 5, 1998_______
by Lessor: By Lessee:
__MITSUI FUDOSAN (USA), INC.__ _PACIFIC RESEARCH & ENGINEERING CORP
__A CALIFORNIA CORPORATION____ _A CALIFORNIA CORPORATION___________
By _/S/ XXXXXXX X. XXXXXXXXXXXX__ By _____/S/ XXXX X. XXXXXXXX________
Name Printed: Name Printed:
__XXXXXXX X. XXXXXXXXXXXX_____ _XXXX X. XXXXXXXX___________________
Title: Title:
__SENIOR VICE PRESIDENT_______ _PRESIDENT / CHIEF EXECUTIVE OFFICER
Address: Address:
__0000 XXXXX XXXXXX, XXXXX X _0000 XXXXXX XXXX XXXXX
__XXXXX, XXXXXXXXXX 00000 _CARLSBAD, CALIFORNA 92009
Tel. No. (000) 000-0000 Tel. No. (000) 000-0000
Fax No. (000) 000-0000. Fax No. (000) 000-0000
-----------------------------------------------------------------------------
ADDENDUM TO AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION STANDARD INDUSTRIAL /
COMMERCIAL SINGLE-TENANT LEASE - NET DATED DECEMBER 19, 1998 BY AND BETWEEN
MITSUI FUDOSAN (USA), INC., A CALIFORNIA CORPORATION, AS LESSOR, AND PACIFIC
RESEARCH AND ENGINEERING CORPORATION, A CALIFORNIA CORPORATION, AS LESSEE
===============================================================================
1.2 Premises (continued).
A. Lessor and Lessee will approve those certain preliminary plans
and outline specifications including both a Site Development Plan and Tenant
Improvement Plan for construction of the subject premises and certain
improvements on the demised premises ("Leasehold Improvements"), such
preliminary pLans and outline specifications will be attached hereto as
Exhibits "A" and "B" and incorporated herein by reference. Lessor shall
construct the demised premises with the Leasehold Improvements.
B. Proposed Plans. From such preliminary plans and outline
specification, Lessor shall have an architect reasonably approved by Xxxxxx
prepare proposed final plans and specifications ("Proposed Plans")
substantially in conformity with said preliminary plans and outline
specifications including any changes necessary to meet with governmental
building requirements. The Proposed Plans shall be delivered to Lessee as soon
as reasonably possible from the date hereof. Within seven (7) working days
after delivery of the Proposed Plans to Lessee, Lessee shall set forth in
writing with particularity and precision any (i) corrections or change
necessary to bring the Proposed Plans into substantial conformity with said
preliminary plans and outline specifications and (ii) additions which are
necessary to address details not addressed by the preliminary plans and outline
specifications. If Xxxxxx delivers to Lessor such statement of corrections,
change and additions, except as to additions which, when viewed in the
aggregate, materially increase the costs of construction. Lessor shall have
the Proposed Plans revised substantially in accordance therewith and the
Proposed Plans as revised in accordance with such statement of corrections,
additions and change shall be deemed approved by Lessee (hereinafter, "Proposed
Plans" shall mean the Proposed Plans or revised Proposed Plans, as
appropriate). Failure to deliver to Lessor written notice of any such
corrections or changes within said seven (7) working day period shall
constitute approval of the Proposed Plans by Lessee.
C. As soon as reasonably possible, both Lessor and Lessee shall
endorse on the Plans approval thereof for the purpose of filing the same with
the City of Vista in connection with permit applications for the Improvements
(the "Endorsed Approval of the Plans") thereafter changes may be made only in
accordance with paragraph 1.2(b).
X. Xxxxxx has obtained a Fixed Price Bid ("The Bid") for
construction of the Improvements on which Lessor has based Fixed Rent under
this lease. The Bid is based on Preliminary Plans and Specifications in that
the Proposed Plans are not expected to materially deviate from the Preliminary
Plans and Specifications. Lessor will guarantee the cost of improvements and
has based this Fixed Rent on the shell costs and a portion of the tenant
improvements up to a maximum amount of $1,120,000.00, in accordance with
Paragraph 49 of this lease. This rent will not increase unless such increases
are due to (1.) Lessees delays or change orders submitted by Lessee or
(2.) increases in the city fees that occur during the additional time resulting
from any Lessee delays or change orders.
E. Construction. Within five (5) working days following the
Endorsed Approval of the Plans, as set forth above, Lessor or the general
contractor selected by Lessor shall apply for all building permits necessary
for construction of the Improvements. Lessor, at its sole expense, shall
proceed diligently with the construction and completion of the Improvements
substantially in accordance with the Plans and building permit(s). Lessor
shall complete the construction of the shell building and Tenant Improvements
not later than eight (8) months from the date Lessor and Xxxxxx mutually agree
upon the "Proposed Plans"; provided, however, such date shall be extended by a
period of time equal to the period of any delay or delays encountered by Xxxxxx
affecting said work of construction because of fire, earthquake, rain, or other
acts of God in the nature of a casualty, act of public enemy, riot,
-----------------------------------------------------------------------------
ADDENDUM TO AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION STANDARD INDUSTRIAL /
COMMERCIAL SINGLE-TENANT LEASE - NET DATED DECEMBER 19, 1998 BY AND BETWEEN
MITSUI FUDOSAN (USA), INC., A CALIFORNIA CORPORATION, AS LESSOR, AND PACIFIC
RESEARCH AND ENGINEERING CORPORATION, A CALIFORNIA CORPORATION, AS LESSEE
===============================================================================
insurrection, strikes or boycotts, shortage of material or labor, change in the
plans pursuant to Paragraph 1.2(e) or any other causes beyond the reasonable
control of Lessor including delays caused by Lessee ("Improvements Delay
Period"). Any such extension shall be conditioned upon Lessor first notifying
Lessee of a delay Lessor considers to be an Improvements Delay Period within
five (5) days following the occurrence of the subject delay. Upon reasonable
advance notice, Lessee, at its own risk and expense, may inspect the
Improvements during the course of construction and may call to Lessor's
attention any material deviation between the as-built improvements in progress
and the Plans and Lessor shall cause its general contractor to correct the
same.
F. Changes in the plans. Lessee shall have the right to request
changes in the Plans, which requests shall not be unreasonably denied;
provided, however, that (i) such right shall not be exercised unreasonably;
(ii) no such request shall result in any major structural change in the
Improvements; (iii) through an adjustment in Fixed Rent pursuant to
Paragraph 1.5, Lessee shall pay any additional costs required to implement such
changes, including, architectural fees, increase in construction costs and any
other charges payable hereunder caused by such changes; and (iv) such request
shall constitute an agreement on the part of Lessee to any delay in completion
caused by reviewing, processing and implementing such changes.
G. Completion of Punch-List Items and Adjustments. The
Improvements shall be completed in accordance with this Lease generally and
Paragraph 1.2(b) of this Lease specifically. Lessee will submit to Lessor a
punch list of items that require repair within thirty (30) days after
occupancy. Lessor shall use its best efforts to complete items submitted on
said punch list within thirty (30) days after receipt.
H. Warranties. All warranties received by Lessor from contractors
and materialmen for work done according to the Plans shall inure to the benefit
of Xxxxxx, and during the construction period Lessor shall enforce the same on
behalf of Lessor and Xxxxxx. Xxxxxx agrees that it shall obtain from those who
construct the Improvements a warranty in the usual form against defective
workmanship and materials for a period of at least one (1) year from the
Occupancy Date, except that in respect of the roof such warranty shall be for a
period of ten (10) years. Lessee is responsible for normal preventive
maintenance and repair of the roof structure. A copy of all such construction
warranties shall be provided to Lessee prior to the Occupancy Date and all such
warranties shall be deemed assigned by Lessor to Lessee in the event Lessor
fails to repair or cause to be repaired warranted items during the term of the
applicable warranty.
1.3 Term (continued).
A. Notwithstanding anything in this lease to the contrary, the
term of this lease shall commence on the earlier of the following dates
("Commencement of Term").
1. Thirty (30) days subsequent to the date the demised premises
are ready for occupancy and Lessor gives to Lessee both a certificate from
Lessor's architect stating that, except for "Punch List" items, the
Improvements (as defined herein) have been completed and a copy of a
Certificate of Occupancy with respect to the demised premises duly issued by
the City of Vista; or
2. Thirty (30) days subsequent to the date Lessee occupies the
demised premises.
B. The parties agree to execute a memorandum setting forth the
occupancy date, the date of expiration of the term and any increase or decrease
in rent pursuant to Paragraph 1.5. The Improvements shall be deemed to be
-----------------------------------------------------------------------------
ADDENDUM TO AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION STANDARD INDUSTRIAL /
COMMERCIAL SINGLE-TENANT LEASE - NET DATED DECEMBER 19, 1998 BY AND BETWEEN
MITSUI FUDOSAN (USA), INC., A CALIFORNIA CORPORATION, AS LESSOR, AND PACIFIC
RESEARCH AND ENGINEERING CORPORATION, A CALIFORNIA CORPORATION, AS LESSEE
===============================================================================
"Completed" when Xxxxxx's architect or engineer in charge of construction has
prepared, certified by his signature and delivered to Lessor and Xxxxxx a
written statement that the Improvements have been substantially completed in
accordance with the Plans and any properly authorized changes or amendments
thereto, and certifying the date of such completion (except for minor "punch
list" items which will not preclude Lessee from conducting business from the
Demised Premises and which can and will be completed by Lessor within thirty
(30) days after being identified by Xxxxxx and Xxxxxx within thirty (30) days
after the Occupancy Date).
1.5 Base Rent (continued).
Lessee shall pay the rent to Lessor in advance upon the first
business day of each Rental Period of the Term or extension thereof, at
Lessor's address or at such other place designated by Lessor in a notice to
Lessee, without any prior demand therefor and without any deduction or setoff
whatsoever. If the Term or extension thereof shall commence and end on a day
other than the first day of a Rental Period, then Lessee shall pay, upon the
commencement date the Term or extension thereof and the first day of the last
Rental Period, a pro rata portion of the Fixed Rent, prorated on a per diem
basis, with respect to the portions of the fractional Rental period included in
the Term or extension thereof.
Rent shall be increased on an annual basis in accordance with the
Consumer Price Index an urban Consumers Los Angeles/Anaheim/Riverside-
Metropolitan Area (1982-84=100) published by the United States Department of
Labor, Bureau of Labor Statistics (Index). The minimum annual increase in rent
shall be three (3%) percent with a maximum annual rent increase of five (5%)
percent. Beginning with the rent due on and after the first (1st) anniversary
of the commencement of the term of this lease, and on and after each subsequent
anniversary, the Base Monthly Rent by a fraction, the numerator of which is the
Extension Index and denominator of which is the Beginning Index. If the index
is changed so that the base year differs from that in effect when the term
commences, 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 has not been discontinued or revised.
1.7 Security Deposit (continued).
The following Security Deposit Amounts shall be due as indicated
below:
Upon signing the lease document: $ 47,719.03
Upon tilting of walls of premises $ 95,438.06
---------
Total $143,157.09
Upon occupancy of the premises by Xxxxxx, the first months rent
paid per Paragraph 1.6 of the lease shall apply. Additionally, the Security
Deposit paid upon tilting of the walls of the premises shall apply as rent for
months two (2) and three (3) of the lease term.
2.1 Letting (continued).
Xxxxxx and Xxxxxx agree that the actual square footage of the
Premises and how it has been determined is stated in Paragraph 1.2 above.
-----------------------------------------------------------------------------
ADDENDUM TO AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION STANDARD INDUSTRIAL /
COMMERCIAL SINGLE-TENANT LEASE - NET DATED DECEMBER 19, 1998 BY AND BETWEEN
MITSUI FUDOSAN (USA), INC., A CALIFORNIA CORPORATION, AS LESSOR, AND PACIFIC
RESEARCH AND ENGINEERING CORPORATION, A CALIFORNIA CORPORATION, AS LESSEE
===============================================================================
2.3 Compliance With Covenants, Restrictions And Building
Code(Continued).
Lessee shall comply with the Covenants, Conditions and
Restrictions established for Oak Ridge Business Center III, recorded December
28,1988 at 3:59 p.m.
7.4(b) Removal (continued).
Lessor agrees that it will review all Lessee owned alterations and
determine prior to installation by Lessee if the alterations will be required
to be removed at the expiration of the Lease.
39.5 Option To Extend Term.
In accordance with paragraph 39 of this lease and Lessee is in
possession of the Premises, Lessee shall have two (2) five (5) year options to
extend the term of this lease at a rental rate which shall be ninety-five (95%)
percent of the prevailing market rental rate for similar office / industrial
space. Lessee must give notice, in writing, to Lessor one hundred eighty (180)
days prior to expiration of the original lease term of this lease in order to
exercise said option(s). If Lessor and Lessee are not able to reach a written
agreement on the rent of this extension within thirty (30) days, of Xxxxxx's
exercise of notice then the prevailing "fair market rental rate" shall be
determined by appraisers appointed as hereinafter set forth, based on
comparable rentals for similar office / industrial space, for non-renewing non-
encumbered tenants then charged and collected in North San Diego County taking
into account items that professional real estate appraisers customarily
consider including location, credit of the tenants of other properties, size,
age, design, utility and other relevant factors of other properties in the area
as they compare to the subject premises. The option(s) to extend is personal
to Lessee and may not be exercised or assigned voluntarily or involuntarily by
or to any person or entity other than Lessee, except to an assignee not
requiring Xxxxxx's consent as provided in the section above. The option(s)
hereby granted to Xxxxxx is not assignable separate and apart from this lease,
as provided in paragraph 39 above. The rent thereafter shall be adjusted in
accordance with paragraph 39.6 of the lease (Cost of Living Adjustment [for
options]). Any required appraisal in regard to "fair market rental value"
shall be made as follows: If Lessor and Lessee are unable to come to written
agreement in regard to the rent for each option period within thirty (30) days
of the exercised date, then Lessor and Lessee shall each appoint in writing an
independent qualified real estate appraiser, who shall be a member of the
American Institute of Real Estate Appraisers or equivalent, with at least five
(5) years experience appraising industrial property. Each of these two (2)
appraisers shall prepare a written determination of Fair Market Rental Value
within thirty (30) days. If the two (2) appraisals are within five (5%)
percent, with respect to the annual base rent then the average shall be
calculated and the value thus determined shall conclusively be deemed to be the
fair market rental value of the leased premises for the purposes of this
paragraph and shall accrue from the first (1st) day of the extended term
thereof. However, if the two (2) appraisals are not within (5%) percent then
upon mutual agreement, Lessor and Lessee shall instruct each of their
appraisers to appoint a third appraiser with qualifications as outlined above
within ten (10) days. Such independent third appraiser shall have twenty (20)
days to make his own determination of "fair market rental value" which shall
then conclusively be deemed to be the "fair market rental value" of the lease
premises for the purposes of this paragraph and shall accrue from the first
(1st) day of the extended term hereof. Each party shall pay for the cost of
its appointed appraiser and one-half (1/2) of the of the third (3rd) appraiser.
If either Xxxxxx and Xxxxxx fails to appoint an appraiser, then the appraiser
appointed by the party appointing an appraiser shall make the required
appraisal acting alone and the decision of such appraiser as to "fair market
rental value" of the premises shall be conclusive and binding upon Lessor and
Lessee. In no event shall, delay in the determination of the "fair market
-----------------------------------------------------------------------------
ADDENDUM TO AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION STANDARD INDUSTRIAL /
COMMERCIAL SINGLE-TENANT LEASE - NET DATED DECEMBER 19, 1998 BY AND BETWEEN
MITSUI FUDOSAN (USA), INC., A CALIFORNIA CORPORATION, AS LESSOR, AND PACIFIC
RESEARCH AND ENGINEERING CORPORATION, A CALIFORNIA CORPORATION, AS LESSEE
===============================================================================
value" of the premises effect Xxxxxx's obligation to pay the amount of rent as
is then in force, or the amount of increase, if any, immediately upon receipt
of notification of same. Lessee shall have the option to withdraw its exercise
of the option to extend within five (5) days after final determination of fair
market value by written notice to Lessor, in which event the Lease shall expire
at the end of the current term and Xxxxxx shall reimburse Lessor for its share
of the appraisals (if any).
39.6 Cost Of Living Adjustment (For Options). The base for computing
the increase in the Consumer Price Index All Urban Consumers Los Angles /
Anaheim / Riverside-Metropolitan Area (1982-84=100), published by the United
States Department of Labor, Bureau of Labor Statistics ("Index"), which is in
effect on the ninetieth (90th) day preceding the date of the commencement of
the terms ("Beginning Index"). The Index published and in effect on the
ninetieth (90th) day preceding each anniversary of the commencement of the term
of this lease ("Extension Index") is to be used in determining the amount of
the increase from one year to the next. Beginning with the rent due on and
after the first (1st) anniversary of the commencement of the term of this
lease, and on and after each subsequent anniversary, the Base Monthly Rent by a
fraction, the numerator of which is the Extension Index and the denominator of
which is the Beginning Index. If there is a decline from one lease year to the
next in the Extension Index, the monthly rent due during the subsequent lease
year shall equal the monthly rent due during the then present lease year. If
the index is changed so that the base year differs from that in effect when the
term commences, 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 has not been discontinued or revised.
49. Tenant Improvements.
(1) Lessor will provide for the tenant improvements ("Tenant
Improvements") indicated on the improvement estimate attached as Exhibit "B",
which is mutually acceptable to both Lessor and Lessee. The space plan for the
Tenant Improvements ("Space Plan") shall be prepared by Xxxxxx Xxxxxxxx and
Associates Architecture and shall be subject to the approval of Lessor and
Xxxxxx. Lessee shall be responsible for executing a written fixed Price
Contract between Xxxxxx and Xxxxxx Xxxxxxxx and Associates, whose fee will be
paid out of the Tenant Improvement Allowance referenced in Paragraph 49.2
below. The parties anticipate that certain changes will be made to Exhibit "B"
in the course of finalizing the Space Plan, and the parties' approval of the
Space Plan shall not be unreasonably withheld or delayed. Lessor shall cause
working drawings ("Working Drawings") to be prepared in conformance with the
approved Space Plan. Lessee shall have the right to approve the Working
Drawings within two (2) business days after Xxxxxx's receipt, but approval
shall not be unreasonably withheld if the Working Drawings are in conformance
with the approval Space Plan. Lessor's agent, Xxxxxxx Construction, shall
construct the Tenant Improvements in accordance with Exhibit "B" the approved
Working Drawings. Lessor shall be deemed to have completed the Tenant
Improvements and to have delivered possession of the Property to Lessee for of
commencing the Lease Term when Xxxxxx's architect certifies to
Lessee in writing that the Tenant Improvements have been completed in
accordance with the approved Working Drawings, with no more than minor "punch
list" items to be corrected.
(2) The costs of Tenant Improvements, including construction costs,
construction drawings, space planning, permits and fees, shall be allocated
between the parties as follows: (i) Lessor shall pay such costs up to a
maximum of $1,120,000.00; (ii) any excess costs above $1,120,000.00 shall be
covered by a contract between Xxxxxxx Construction and Lessee. Lessee shall be
responsible for paying these excess costs directly to Xxxxxxx Construction.
-----------------------------------------------------------------------------
ADDENDUM TO AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION STANDARD INDUSTRIAL /
COMMERCIAL SINGLE-TENANT LEASE - NET DATED DECEMBER 19, 1998 BY AND BETWEEN
MITSUI FUDOSAN (USA), INC., A CALIFORNIA CORPORATION, AS LESSOR, AND PACIFIC
RESEARCH AND ENGINEERING CORPORATION, A CALIFORNIA CORPORATION, AS LESSEE
===============================================================================
(3) Each Party shall take all necessary actions and grant all
necessary approvals in compliance with the schedule ("Tenant Improvement
Schedule") attached hereto as Exhibit "C" in order to facilitate timely
completion of the Tenant Improvements.
(4) Lessor Warranties. In connection with its construction of
Improvements, Lessor represents and warranties:
a. That the air conditioning, heating and ventilation system
installed in the demised premises shall meet with any applicable federal and
local standards and comply with Title 24 of the California Administrative Code
as applied by the Uniform Building Code of the City of Vista as of the time of
installation of such system.
b. The Improvements shall be constructed in a first class manner,
free from defects in materials, workmanship or design and in compliance with
all current laws, ordinances, regulations and codes relating thereto including
the Americans with Disabilities Act.
"CONSULT YOUR ADVISORS - This document has been prepared for approval by your
attorney. No representation or recommendation is made by Colliers
International as to the sufficiency or tax consequences of this document or the
transaction to which it relates. These are questions for your attorney. In
any real estate transaction, it is recommended that you consult with a
professional, such as a civil engineer, industrial hygienist or other person,
with experience in evaluating the condition of the property, including the
possible presence of asbestos, hazardous materials and underground storage
tanks."
-----------------------------------------------------------------------------
EXHIBIT B
TENANT IMPROVEMENT PLAN
(To be added at a later date.)
-----------------------------------------------------------------------------
EXHIBIT C
CONSTRUCTION / TENANT IMPROVEMENT SCHEDULE
(To be added at a later date.)
-----------------------------------------------------------------------------
COLLIERS XXXXX XXXXX
HAZARDOUS WASTES OR SUBSTANCES
ADDENDUM TO LEASEIPROPOSAL TO LEASE
Dated __December 19, 1998__
The Undersigned ("Landlord") represents that Landlord has no knowledge,
except as otherwise disclosed in writing, of the existence or prior existence
(the term "existence" including, but not being limited to, generation,
location, transportation, storage, treatment, discharge, disposal, release or
threatened release) on the Premises of the land upon which the Premises is
located (collectively, the "Property") of any Hazardous Wastes or Substances or
storage tanks above or below the ground.
Xxxxxxxx is aware of the following inspection reports, studies, letters,
test results, advisories and similar documents (collectively, "Reports"),
addressing the issue of the existence or non-existence on the Property of
Hazardous Wastes or Substances or storage tanks and represents that Landlord
has no knowledge of any other Reports not listed (list all such Reports; if
none, write "No Reports").
===============================================================================
Limited Hazardous Waste Potential Assessment for Oak Ridge Business Center -
Phase III, Vista, California, November 1990. Prepared by Xxxxxx Xxxxxx
Associates Consulting Soil, Foundation & Geological Engineers.
===============================================================================
Upon execution of the Lease, Landlord shall provide Tenant with copies of
any and all Reports and any and all modifications and supplements to the
Reports which may be obtained by Landlord.
If at any time Hazardous Wastes or Substances or underground storage tanks
are determined to exist on the Property (other than as disclosed in the
Reports), Landlord shall either (a) take those steps that may be necessary or
reasonable to remove or otherwise xxxxx the effect of such items in accordance
with all applicable rules, regulations, laws and requirements; or (b) by
written notice to Tenant, give Tenant the right to terminate this Lease.
Landlord shall use its best efforts not to materially interfere with the
conduct of Xxxxxx's business during any such removal or abatement process.
Landlord and Tenant expressly acknowledge that Colliers Xxxxx Xxxxx
("Broker") has not made an independent investigation or determination with
respect to the existence or prior existence on the Property of Hazardous Wastes
or Substances or storage tanks. Any such investigation or determination shall
be the responsibility of Landlord and Tenant and Broker shall not be held
responsible therefor, and Landlord and Tenant shall indemnify and hold harmless
Broker from and against any liability or responsibility claimed in connection
therewith.
The term "hazardous wastes or substances" is used herein in its broadest
sense and includes, but is not limited to, petroleum base products, paints and
solvents, lead, cyanide, DDT, printing inks, acids, pesticides, ammonium
compounds, asbestos, PCB's, contaminants, toxic wastes, toxic pollutants,
dredged soil, solid waste, pesticides, herbicides, fertilizers and other
agricultural chemicals, incinerator residue, sewage, garbage, sewage sludge,
munitions, chemical wastes and products, biological materials, radioactive
materials, wrecked or discarded equipment, and mining, industrial, municipal
and agricultural wastes or any other liquid, solid or gaseous pollutants or
hazardous substances, and the same or any other wastes or substances subject to
regulation under any State or Federal environmental protection law or
regulation.
Landlord: TENANT:
__Mitsui Fudosan (USA), Inc.__ _Pacific Research & Engineering Corp._
____/S/ Xxxxxxx X Xxxxxxx_____ __________/S/ Xxxx Xxxxxxxx___________
____Senior Vice President_____ __President / Chief Executive Officer_
-----------------------------------------------------------------------------
NOTICE TO OWNERS, BUYERS AND TENANTS REGARDING
HAZARDOUS WASTES OR SUBSTANCE AND
UNDERGROUND STORAGE TANKS
Comprehensive federal and state laws and regulations have been enacted in
the last few years in an effort to develop controls over the use, storage,
handling, clean-up, removal and disposal of hazardous wastes or substances
(including pollutants). Some of these laws and regulations, such as, for
example, the so-called "Superfund Act," provide for broad liability schemes
wherein an owner, tenant or other user of the property may be liable for clean-
up costs and damages regardless of fault and even though the contamination
occurred prior to the time he acquired an interest in the property. Other laws
and regulations set standards for the handling of asbestos or establish
requirements for the use, modification, abandonment, or closing of underground
storage tanks. Still other laws and regulations apply to the release of any
pollutants that may reach an aquifer or the environment.
It is often difficult to determine whether hazardous wastes or substances
are present. With respect to improved property, for instance, various items
utilized in the construction of improvements may contain materials that have
been or may in the future be determined to contain hazardous wastes or
substances and may need to be specially treated, specially handled and/or
removed from the property. For example, some electrical transformers and other
electrical components can contain PCB's, and asbestos has been used in a wide
variety of building components such as fire-proofing, air duct insulation,
acoustical tiles, spray-on acoustical materials, linoleum, floor tiles and
plaster. Hazardous wastes or substances may be in above-ground and below-
ground containers on the property or may be present on or in soil, water,
building components or other portions of the property in areas that may or may
not be accessible or noticeable. It is generally important to obtain expert
assistance for site investigations and building inspections. The past uses of
the property may also provide valuable information as to the likelihood of
hazardous wastes or substance or underground storage tanks being on the
property.
It is not practical or possible to list all the applicable laws and
regulations or all the areas of concern in this Notice. Therefore, owners,
buyers and tenants are urged to consult legal counsel to determine their
respective rights and liabilities with respect to the issues described in this
Notice as well as other aspects of the proposed transaction. You and your
counsel should review and analyze all inspection reports, studies, letters,
test results, advisories and similar documents (collectively, "Reports"),
addressing the issue of the existence or non-existence on the property of
hazardous wastes or substances or storage tanks. To the extent such Reports are
deemed inadequate or do not exist, you should obtain appropriate Reports from
qualified independent inspectors. Finally, you and your counsel should reach
an independent conclusion with respect to the impact, if any, of the existence
on the property of hazardous wastes or substances or storage tanks. If
hazardous wastes or substances (including pollutants) have been, or are going
to be used, stored, handled or disposed of on the property, or if the property
has or may have underground storage tanks, it is essential that legal and
technical advice be obtained to determine, among other things, what permits and
approvals have been or may be required, if any, the estimated costs and
expenses associated with the use, storage, handling, clean-up, removal or
disposal of the hazardous wastes or substance and what contractual provisions
and protections are necessary or desirable.
Xxxxxxxx Xxxxx Xxxxx has not made investigations or obtained Reports
regarding the subject matter of this Notice, except as may described in a
separate written document signed by Xxxxxxxx Xxxxx Xxxxx. Colliers Xxxxx Xxxxx
makes no representations regarding the existence or nonexistence of hazardous
wastes or substances or underground storage tanks on the property, and has no
expertise in this area that may be relied upon by any party.
The terms "hazardous wastes or substance" is used in this Notice in its
very broadest sense and includes, but is not limited to, petroleum base
products, paints and solvents, lead, cyanide, DDT, printing inks, acids,
pesticides, ammonium compounds, asbestos, PCB's, contaminants, toxic wastes,
toxic pollutants, dredged spoil, solid waste, pesticides, herbicides,
fertilizers and other agricultural chemicals, incinerator residue, sewage,
garbage, sewage sludge, munitions, chemical wastes and products, biological
materials, radioactive materials, wrecked or discarded equipment, and mining,
industrial, municipal and agricultural wastes or any other liquid, solid or
gaseous pollutants or hazardous substance, and the same or any other wastes or
substances subject to regulation under the State or Federal environmental
protection law or regulation. Hazardous wastes or substances and underground
storage tanks may be present on all types of real property. This Notice is
therefore meant to apply to any transaction involving any type of real
property, whether improved or unimproved.
The undersigned acknowledges receipt of a copy of this Notice
Date: _8 January 1998________ Date: _____5 January 1998____________
__Mitsui Fudosan (USA), Inc.__ _Pacific Research & Engineering Corp._
____/S/ Xxxxxxx X Xxxxxxx_____ __________/S/ Xxxx Xxxxxxxx___________
-----------------------------------------------------------------------------
Attachment A
NOTICE TO OWNERS AND PROSPECTIVE BUYERS
OR TENANTS OF REAL PROPERTY REGARDING THE
AMERICANS WITH DISABILITIES ACT (XXX)
The government of the United States has recently enacted the Americans
With Disabilities Act (ADA), a federal law codified at 42/USC Section 12101
et seq. Among other requirements of the ADA that could apply to your property,
this act is intended to make owners and tenants of certain types of business
establishments defined as "public accommodations" provide facilities that are
equally accessible to persons with a variety of disabilities. State and local
laws may also impose requirements.
The real estate brokers in this transaction are not qualified to advise
you as to what, if any, changes may be required now, or in the future. We
recommend that owners and tenants consult attorneys and design professionals of
their choice for information regarding these matters and the impact, if any, on
the proposed lease or purchase agreement and the property. These are legal
issues and you are responsible for conducting your own independent
investigation of these issues. Colliers Xxxxx Xxxxx cannot give you legal
advice on these issues.
SELLER / LANDLORD: BUYER / TENANT:
XXXXXX XXXXXXX (USA), INC. PACIFIC RESEARCH AND ENGINEERING CORP.
A CALIFORNIA CORPORATION A CALIFORNIA CORPORATION
By: _/S/ Xxxxxxx X Xxxxxxx___ By: _____/S/ Xxxx Xxxxxxxx___________
____Senior Vice President_____ __President / Chief Executive Officer_
Date: _8 January 1998________ Date: _____5 January 1998____________
-----------------------------------------------------------------------------
Attachment B
PUBLIC ACCOMODATION VS. COMMERCIAL FACILITY
Title III of the ADA divides covered buildings and facilities into two (2)
categories: "Public Accommodations" and "Commercial Facilities".
A public accommodation is responsible for meeting the ADA requirements for
removal of barriers. (However, areas of public accommodation that are used
only by employees at work areas are not subject to this requirement. In such
case, "reasonable accommodation" under Title 1 of the ADA must be made for
employees with a disability to enter and use those areas.)
A public accommodation must provide auxiliary aids when they are necessary
to ensure effective communication with persons who have hearing, vision, or
speech impairments. A public accommodation must also meet the technical
requirements for alterations and new construction.
The responsibilities for providing auxiliary aids and for removal of
barriers do not apply to commercial facilities. (However, "reasonable
accommodations" under Title 1 of the ADA must be made for employees with a
disability to enter and use the facility.)
USE THE CRITERIA BELOW TO DETERMINE WHICH CATEGORY
YOUR BUILDING OR FACILTIY IS IN:
PUBLIC ACCOMMODATION - A "public accommodation" is a private entity that owns,
leases (or leases to), or operates a "place of public accommodation". The
place of public accommodation is a private facility whose operations affect
commerce and fall within at least one (1) of twelve (12) categories:
* Place of lodging (e.g. an inn, hotel or motel).
* Establishment serving food or drink (a restaurant, bar, or other
establishment serving food and drink).
* Place of exhibition or entertainment (a movie house or theater).
* Place of public gathering (an auditorium, lecture hall, or convenience
center).
* Sales or rental establishment (a dry cleaner, bank, xxxxxx shop, beauty
shop, travel agency, shoe repair service, office of an accountant or lawyer,
pharmacy, insurance office, professional office of a health car provider, or
other service establishment).
* Station used for specified public transportation.
* Place of public display or collection (a museum, library, or gallery).
* Place of education (a nursery school, elementary or secondary school,
undergraduate or postgraduate private school, or other place of education).
* Social service center establishment (day care center, senior citizen center,
or food bank).
* Place of exercise or recreation (a gymnasium, health spa, or other place of
exercise or recreation).
COMMERCIAL FACILITY - A "commercial facility" is a facility intended for non-
residential use by a private entity and whose operations affect commerce.
Examples are office buildings, warehouses, factories, and other buildings in
which employment may occur.
While a public accommodation contains areas that are meant for the
public's use, a commercial facility is built for a private business and its
employees. For instance, an office building that is occupied by a single
tenant and contains no places of public accommodation would be considered a
commercial facility. According to an interpretation from the Justice
Department, it is possible for part of a building to be a commercial facility
while other portions are public accommodations.
-----------------------------------------------------------------------------
Attachment C
SUMMARY OF REQUIREMENTS
UNDER TITLE III OF THE ADA
PUBLIC ACCOMMODATIONS COMMERCIAL FACILITIES
--------------------- ---------------------
Existing Buildings -
By January 26, 1992, owners, operators No requirements
and tenants must remove barriers to
access by disable persons, if the
removal is "readily achievable," and
provide auxiliary aids and services
for hearing, vision, or speech
impaired persons, unless such aids and
services would cause an "undue burden".
Alterations -
After January 26, 1992, owners, Same requirements as for public
operators and tenants must comply with accommodations
the technical requirements for
alterations to provide access for
disabled persons.
New Construction -
After January 26, 1993, owners, and Same requirements as for public
operators and tenants must comply with accommodations
the technical requirements for new
construction to provide access for
disabled persons.
----------------------------------------------------------------------------
