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P R O P E R T I E S
STANDARD INDUSTRIAL LEASE For Landlord Use Only:
(NET-NET-NET) Building #: 228CD
L/A: BPE
Lease Preparation Date: September 27, 1996
Landlord: Xxxxxxx Properties, a Nevada corporation, located at 0000 Xxxxxxxxx
Xxxxxxxxx, X. X. Xxx 0000, Xxxx, Xxxxxx 00000
Tenant: MicroAge Logistics Services, Inc., a Delaware corporation
Trade Name (dba): MicroAge
1. LEASE TERMS
1.01 Premises: The Premises referred to in this Lease contain
approximately 100,648 square feet as shown on Exhibit "A" attached. The address
of the Leased Premises is: 1430 East Xxxx Street, Xxxxx 000 xxx 000, Xxxxxx,
Xxxxxx 00000.
1.02 Project: The Project in which the Premises are located consist of
approximately 201,295 square feet as shown in Exhibit A.
1.03 Tenant's Notice Address: Tenant's Notice Address is the address of
the Leased Premises as defined in Section 1.01 unless otherwise specified here:
0000 X. XxxxxXxx Xxx, Xxxx: V.P. Administration, Xxxxx, XX 00000.
1.04 Landlord's Notice Address: P. X. Xxx 0000, Xxxx, Xxxxxx 00000
1.05 Tenant's Permitted Use: Computer warehousing, configuration, and
product clearance, general office, and call center operations, in compliance
with all applicable laws, rules, and regulations and this Lease.
1.06 Lease Term: The Lease Term is for five (5) years and one (1) month
and commences on December 1, 1996, and expires December 31, 2001.
1.07 Base Monthly Rent: Shall be paid in lawful money of the United
States of America based on the following schedule:
Month 1, December 1, 1996 - December 31, 1996:
Free of Base Monthly Rent; however, Tenant shall be required to pay
"Additional Rent" pursuant to Article 5. herein;
Months 2 - 13,January 1,1997 - December 31, 1997:
TWENTY-TWO THOUSAND, FIVE HUNDRED TWENTY FIVE AND NO/100 DOLLARS
($22,525.00) per month;
Months 14 - 19, January 1, 1998 - June 30, 1998:
TWENTY-THREE THOUSAND, THREE HUNDRED SEVENTY FIVE AND NO/100 DOLLARS
($23,375.00) per month;
Months 20 - 25, July 1, 1998 - December 31, 1998:
TWENTY-SEVEN THOUSAND, SIX HUNDRED SEVENTY-EIGHT AND 20/100 DOLLARS
($27,678.20) per month;
Months 26 - 43, January 1, 1999 - June 30, 2000:
TWENTY-EIGHT THOUSAND, SIX HUNDRED EIGHTY-FOUR AND 68/100 DOLLARS
($28,684.68) per month; and
Months 44 - 61, July 1, 2000 - December 21, 2001:
TWENTY-NINE THOUSAND SIX HUNDRED NINETY-ONE AND 16/100 DOLLARS
($29,691.16) per month.
1.08 Security Deposit: --$0-- in lawful money of the United States of
America.
1.09 Proportionate Share: Tenant's Proportionate Share is 50% based
upon the total square footage of the Project and the square --- footage of the
Premises.
1.11 Tenant is entitled to common vehicle parking spaces subject to the
provisions of Section 8 of the Lease.
1.12 Tenant Improvements: Tenant Improvements to be performed in the
Premises, if any, will be performed in accordance with the terms and provisions
entitled "Landlord's Work" contained in Exhibit "B" attached if applicable.
Thereafter during the Lease Term, Landlord will be under no obligation to alter,
change, decorate or improve the Premises.
1.13 Guaranty: Tenant's obligations under this Lease shall be
guaranteed by MicroAge Computer Centers, Inc., a Delaware corporation, pursuant
to the Guaranty attached hereto as Exhibit "E" and made a part hereof.
2. DEMISE AND POSSESSION
2.01 Landlord leases to Tenant and Tenant leases from Landlord the
Premises described in 1.01. By entering the Premises, Tenant acknowledges that
it has examined the Premises and accepts the Premises in their present condition
subject to any additional work Landlord has agreed to do as stated on Exhibit B
if applicable. Landlord expressly reserves its right to lease any other space
available in the Project to whom ever it wishes, further Tenant hereby
acknowledges that it did not rely on any other tenant remaining a tenant in the
Project as a consideration for entering into this Lease.
2.02 If for any reason Landlord cannot deliver possession of the
Premises on the date the Lease commences, Landlord shall not be subject to any
liability nor shall the validity of this Lease be affected. If Tenant has not
caused such delay there shall be a proportionate reduction of the Base Monthly
Rent covering the period between the commencement of the Lease Term and the date
when Landlord can deliver possession. However, Tenant, unless it is the cause of
the delay, has the right to cancel this Lease by written notification if
possession of the Premises is not delivered within ninety (90) days of the date
the Lease Term commences. Landlord may terminate this Lease by giving written
notice to Tenant if possession of the Premises is not delivered within ninety
(90) days of the date the lease is to commence.
3. BASE MONTHLY RENT
3.01 Base Monthly Rent: Commencing January 1, 1997, Tenant will pay,
without deduction or offset (except as set forth in Section 30.01), prior notice
or demand, Base Monthly Rent at the place designated by Landlord. However, the
first month's rent is due and payable upon execution of this Lease. In the
event, that the Term of this Lease commences or ends on a day other than the
first day of a calendar month, a prorated amount of Base Monthly Rent shall be
due upon execution and it will be calculated using a thirty (30) day month. In
the event this Lease is to commence upon a date not ascertained on execution,
both parties agree to complete and execute a Commencement Date Certificate in
the form of Exhibit "F" within ten (10) days of the Commencement Date, if
applicable.
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3.02 See Section 1.07 herein for Rent Schedule.
3.03 Any installment of rent or any other charge payable which is not
paid within ten (10) days after it becomes due will be considered past due and
Tenant will pay to Landlord as Additional Rent a late charge equal to the
product of the variable Prime Rate "Prime", plus six percent (6%) per annum as
charged by Bank of America, Nevada; times the amount of such installment amount
due, or eighteen percent (18%) per annum of such installment or the sum of
twenty-five dollars ($25.00), whichever is greater, for each month or fractional
month transpiring from the date due until paid. Notwithstanding the foregoing,
no late charge for the first three (3) delinquent payments of rent or any other
charge payable under this Lease shall be assessed unless such delinquent payment
is not made within ten (10) days of written notice from Landlord to Tenant of
the delinquency. A twenty-five dollar ($25.00) handling charge will be paid by
Tenant to Landlord for each returned check and, thereafter, Tenant will pay all
future payments of rent or other charges due by money order or cashier's check.
In the event a late charge is assessed for three (3) consecutive rental periods,
whether or not it is collected, the rent shall without further notice become due
and payable quarterly in advance notwithstanding any provision of this Lease to
the contrary. If Tenant shall be served with a demand for the payment of past
due rent, any payments tendered thereafter to cure any default by Tenant shall
be made only by cashier's check or equivalent.
3.04 The amount of the Base Monthly Rent includes projected
construction of Tenant's improvements as indicated on Exhibit "B" attached. In
the event that Tenant requests Landlord to construct additional improvements
and/or final construction costs exceed original estimates, such costs or
expenses upon itemized notice by Landlord, shall be paid by Tenant to Landlord,
or Landlord may increase the Base Monthly Rent according to the terms and
conditions outlined on Exhibit "B", or elsewhere in this Lease.
4. COMMON AREAS
4.01 Definitions: "Common Areas": "Common Area" is defined as all areas
and facilities outside the Premises and within the exterior boundary line of the
Project that are provided and designated by Landlord for the non-exclusive use
of Landlord, Tenant and other lessees of the Project and their respective
employees, agents, customers and invitees. Common Areas include, but are not
limited to: all parking areas, loading and unloading areas, trash areas,
roadways, sidewalks, walkways, parkways, driveways, corridors, landscaped areas
and any restrooms used in common by lessees.
4.02 Tenant, its employees, agents, customers and invitees have the
non-exclusive right (in common with other Tenants, Landlord, and any other
person granted use by Landlord) to use of the Common Areas. Tenant agrees to
abide by and conform to, and to cause its employees, contractors, and agents to
abide by and conform to all rules and regulations established by Landlord
subject to provisions of paragraph 24. Tenant agrees to cause its customers and
invitees to abide by and conform to all rules and regulations established by
Landlord subject to the provisions of paragraph 24 with respect to the Premises
and to utilize its best efforts to cause its customers and invitees to abide by
and conform to all rules and regulations established by Landlord subject to the
provisions of paragraph 24. with respect to the Project.
4.03 Landlord has the right, in its sole discretion, from time to time,
to: 1) make changes to the Common Areas, including without limitation, changes
in the location, size, shape and number of driveways, entrances, parking spaces,
parking areas, ingress, egress, direction of driveways, entrances, corridors
parking areas and walkways; 2) close temporarily any of the Common Areas for
maintenance purposes so long as reasonable access to the Premises remains
available; 3) add additional buildings and improvements to the Common Areas; 4)
use the Common Areas while engaged in making additional improvements, repairs or
alterations to the Project or any portion thereof; do and perform any other acts
or make any other changes in, to or with respect to the Common Areas and Project
as Landlord may, in the exercise of sound business judgement, deem to be
appropriate. Notwithstanding the foregoing, (1) at no time will parking spaces
located within the Project and available for use by Tenant and Tenant's
employees, contractors, agents, customers, and invitees be less than the total
number of parking spaces within the Project multiplied by Tenant's Proportionate
Share percentage specified in Section 1.09 above, and (2) any acts by or
authorized by Landlord specified in this Section 4.03 shall not materially and
unreasonably interfere with the conduct of Tenant's business from the Premises,
except in the case of emergency.
5. ADDITIONAL RENT
5.01 All charges payable by Tenant other than Base Monthly Rent are
called "Additional Rent". Unless this lease provides otherwise, Additional Rent
is to be paid with the next monthly installment of Base Monthly Rent and is
subject to the provisions of 3.03. The term "rent" whenever used in this Lease
means Base Monthly Rent and Additional Rent.
5.02 Operating Costs
A. "Operating Costs" are all costs and expenses of ownership,
operation, maintenance, management, repair and insurance incurred by Landlord
for the Project including, but not limited to the following: all supplies,
materials, labor and equipment, used in or related to the operation and
maintenance of the Common Areas; all utilities, including but not limited to:
water, electricity, gas, heating, lighting, sewer, waste disposal related to the
maintenance or operation of the Common Areas; all air-conditioning and
ventilating costs related to the maintenance or operation of the Project; all
Landlord's costs in managing, maintaining, repairing, operating and insuring the
Project, including, for example, clerical, supervisory, and janitorial staff;
all maintenance, management and service agreements, including but not limited
to, janitorial, security, trash removal related to the maintenance or operation
of the Project; all legal and accounting costs and fees for licenses and permits
related to the ownership and operation of the Project; all insurance premiums
and costs of fire, casualty, and liability coverage, rent abatement and
earthquake insurance and any other type of insurance related to the Entire
Project, including any deductible for a loss attributable to the Premises; all
operation, maintenance and repair costs to the Common Areas, including but not
limited to, sidewalks, walkways, parkways, parking areas, loading and unloading
areas, trash areas, roadways, driveways, corridors, and landscaped area,
including for example, costs of resurfacing and restriping parking areas; all
maintenance and repair costs of building exteriors (including painting, asphalt
repair and replacement, and roof maintenance, repair and replacement), restrooms
used in common by Tenants and signs and directories of the Project; amortization
(along with reasonable financing charges) of capital improvements made to the
Common Areas which may be required by any government authority or which will
improve the operating efficiency of the Project; a reasonable reserve for
repairs and replacement; a five percent (5%) fee for Landlord's supervision of
the Common Areas (five percent (5%) of the total above mentioned costs and
expenses incurred in a calendar year). Operating Costs will not include (1)
depreciation of the Project, (2) lease, mortgage, or similar payments made by
Landlord, (3) Real Project Taxes, or (4) late charges specified in Section 3.03
above.
B. Tenant shall pay to Landlord Tenant's Proportionate Share of the
Operating Costs as indicated in 1.09. If there is a change in the square footage
of either the Project or the Premises during the term of this Lease the
Proportionate Share of the Tenant shall be
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adjusted accordingly. Such payment shall be paid by Tenant with and in addition
to the monthly payment of Base Monthly Rent. Tenant shall, if Landlord so
elects, pay to Landlord on a monthly basis, in advance, the amount which
Landlord reasonably estimates to be Tenant's Proportionate Share of the
Operating Costs. In the event of such election by Landlord, Landlord shall
periodically determine Tenant's share of the actual Operating Costs, and in the
event that the amount which Tenant has paid to Landlord on account of the
estimated Operating Costs is less than his share of such actual Operating Costs,
Tenant shall pay such difference to Landlord on the next rent payment date. In
the event that Tenant has paid to Landlord more than his share of such actual
Operating Costs, the amount of such difference shall be credited against
Tenant's payments of Operating Costs next due or if such period is at the end of
the Lease term the amount of any overpayment shall be promptly refunded to
Tenant.
C. Failure by Landlord to provide Tenant with a statement by April
1st of each year shall not constitute a waiver by Landlord of its right to
collect Tenant's share of Operating Costs or estimates for a particular calendar
year, Landlord's right to charge Tenant for such expenses in subsequent years is
not waived. Upon reasonable written notice to Landlord, Tenant shall have the
right to audit Landlord's books and records with respect to Additional Rent at
Landlord's offices at Tenant's sole cost and expense, and not more frequently
than annually.
5.03 Taxes
A. "Real Project Taxes" are: (i) any fee, license fee, license tax,
business license fee, commercial rental tax, levy, charge, assessment, penalty
or tax imposed by any taxing authority against the Project; (ii) any tax or fee
on Landlord's right to receive, or the receipt of, rent or income from the
Project or against Landlord's business of leasing the Project, (iii) any tax or
charge for fire protection, streets, sidewalks, road maintenance, refuse or
other services provided to the Project by any governmental agency; (iv) any tax
imposed upon this transaction, or based upon a re-assessment of the Project due
to a change in ownership or transfer of all of part or Landlord's interest in
the Project; (v) any charge or fee replacing, substituting for, or in addition
to any tax previously included within the definition of real property tax; and
(vi) the Landlord's cost of any tax protest relating to any of the above. Real
Project Taxes do not, however, include Landlord's federal or state income,
franchise, inheritance or estate taxes.
B. Tenant shall pay to Landlord Tenant's Proportionate Share of the
Real Project Taxes as indicated in 1.09 for Real Project Taxes which accrue
during the Lease term. Such payment shall be paid by Tenant annually upon being
invoiced for such taxes in addition to the monthly payment of Base Monthly Rent.
Tenant shall, if Landlord so elects, pay to Landlord on a monthly basis, in
advance, the amount which Landlord reasonably estimates to be Tenant's
Proportionate Share of the Real Project Taxes. In the event of such election by
Landlord, Landlord shall periodically determine Tenant's share of the actual
Real Project Taxes, and in the event that the amount which Tenant has paid to
Landlord on account of the Real Project Taxes is less than his share of such
actual Real Project Taxes, Tenant shall pay such difference to Landlord on the
next rent payment date. In the event that Tenant has paid to Landlord more than
his share of such actual Real Project Taxes, the amount of such difference shall
be credited against Tenant's payment of Real Project Taxes next due. If the
Lease term is expired then Landlord shall promptly refund any overpayment to
Tenant. Landlord shall exercise commercially reasonable efforts to reduce Real
Project Taxes as determined by Landlord in Landlord's sole and absolute
discretion.
C. Personal Property Taxes: Tenant will pay all taxes charged against
trade fixtures, furnishing, equipment or any other personal property belonging
to Tenant. Tenant will have personal property taxes billed separately from the
Project. If any of Tenant's personal property is taxed with the Project, Tenant
will pay Landlord the taxes for the personal property upon demand by Landlord.
5.04 Based on Tenant's Proportionate Share defined in 1.09, Tenant
agrees to pay as Additional Rent to Landlord its share of any parking charges,
utility surcharges, occupancy taxes, or any other costs directly resulting from
the statutes or regulations, or interpretations thereof, enacted by any
governmental authority in connection with the use or occupancy of the Project or
the parking facilities serving the Project, or any part thereof.
5.05 Landlord by completing this paragraph may elect to have Tenant pay
a monthly estimate of the Additional Rent due from Tenant of 5(cent) per square
foot, i.e, FIVE THOUSAND, THIRTY-TWO AND 40/100 DOLLARS ($5,032.40) per month.
Landlord shall make adjustments to this estimate based upon actual costs and
projected future costs. Landlord shall periodically determine the balance
between actual Additional Rent and Additional Rent paid by Tenant and make
adjustments in accordance with 5.02 and 5.03 above.
7. USE OF PREMISES: QUIET CONDUCT
7.01 The Premises may be used and occupied only for Tenant's Permitted
Use as shown in 1.05 and for no other purpose, without obtaining Landlord's
prior written consent. Tenant will comply with all laws, ordinances, orders and
regulations affecting Tenant's use and occupancy of the Premises. Tenant will
not perform any act or carry on any practices that may injure the Project or the
Premises or be a nuisance or menace, or disturb the quiet enjoyment of other
lessees in the Project including but not limited to equipment which causes
vibration in excess of commercially reasonable standards or is otherwise
damaging to the Premises, or any portion or component thereof, or any other
tenant, use or storage of chemicals other than minimal amounts in the ordinary
course of business and in full compliance with all "Environmental Laws" (as
defined in Section 7.02 below), or heat or noise which is not properly
insulated. Tenant will not cause, maintain or permit any outside storage on or
about the Premises. In addition, Tenant will not allow any condition or thing to
remain on or about the Premises which diminishes the appearance or aesthetic
qualities of the Premises and/or the Project or the surrounding property. The
keeping of a dog or other animal on or about the Premises is expressly
prohibited.
7.02 As used in this section, the term "Hazardous Waste" means:
A. Those substances defined as "hazardous substances", "hazardous
materials", "toxic substances", "regulated substances", or "solid waste" in the
Toxic Substance Control Act, 15 U.S.C. ss. 2601 et. seq., as now existing or
hereafter amended ("TSCA"), the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, 42 U.S.C. ss. 9601 et. seq., as now
existing or hereafter amended ("CERCLA"), the Resource, Conservation and
Recovery Act of 1976, 42 U.S.C. Section 6901 et. seq., as now existing or
hereafter amended ("RCRA"), the Federal Hazardous Substances Act, 15 U.S.C. ss.
1261 et. seq., as now existing or hereafter amended ("FHSA"), the Occupational
Safety and Health Act of 1970, 29 U.S.C. ss. 651 et. seq., as now existing or
hereafter amended ("OSHA"), the Hazardous Materials Transportation Act, 49
U.S.C. ss. 1801 et. seq., as now existing or hereafter amended ("HMTA"), and the
rules and regulations now in effect or promulgated hereafter pursuant to each
law referenced above;
B. Those substances defined as "hazardous waste", "hazardous
material", or "regulated substances" in Nev. Rev. Xxxx. xx 000, 0000 Xxx. Xxxx.
ch. 598 and 1989 Nev. Stat. ch 363, or in the regulations now existing or
hereafter promulgated pursuant thereto or in the Uniform Fire Code, 1988
edition;
C. Those substances listed in the United States Department of
Transportation table (49 CFR ss. 172.101 and amendments thereto) or by the
Environmental Protection Agency (or any successor agency) as hazardous
substances (40 CFR Part 302 and amendments thereto); and
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D. Such other substances, mixtures, materials and waste which are
regulated under applicable local, state or federal laws, rules, or regulations,
or which are classified as hazardous or toxic under federal, state or local
laws, rules, or regulations (all laws, rules and regulations referenced in
paragraphs (a), (b), (c) and (d) are collectively referred to as "Environmental
Laws").
7.03 Tenant's Covenants. Tenant does not intend to and Tenant will not,
nor will Tenant allow any of Tenant's employees, contractors, agents, visitors,
customers, or invitees during the term of this Lease to manufacture, process,
store, distribute, use, discharge or dispose of any Hazardous Waste in, under or
on the Project, the Common Areas, or any property adjacent thereto, nor will
Tenant allow any other person (including partnerships, corporations and joint
ventures), during the term of this Lease to manufacture, process, store,
distribute, use, discharge or dispose of any hazardous waste in, under, or on
the Premises, except for minimal amounts of Hazardous Waste in the ordinary
course of business and in full compliance with all Environmental Laws.
A. Tenant shall notify Landlord promptly in the event of any spill or
release of Hazardous Waste into, on, or onto the Project regardless of the
source of spill or release, whenever Tenant knows or suspects that such a
release occurred.
B. Tenant will not be involved in operations at or near the Project
which could lead to the imposition on the Tenant or the Landlord of liability or
the creation of a lien on the Project, under the Environmental Laws.
C. Tenant shall, upon twenty-four (24) hour prior notice by Landlord,
permit Landlord or Landlord's agent access to the Project to conduct an
environmental site assessment with respect to the Project.
7.04. Tenant's Indemnity. Tenant for itself and its successors and
assigns undertakes to protect, indemnify, save and defend (by counsel reasonably
acceptable to Landlord) Landlord, its agents, employees, directors, officers,
shareholders, affiliates, consultants, independent contractors, lenders,
partners, and their respective successors and assigns (collectively the
"Indemnitees") harmless from any and all claims, judgments, causes of action,
liabilities, losses, damages, penalties, fines, taxes, costs, and expenses,
including reasonable attorneys' fees, claims, suits and judgments that Landlord
or any other Indemnitee, whether as Landlord or otherwise, may suffer either
during or after the term of this Lease as a result of, or with respect to:
A. The violation affecting the Project by Tenant or Tenant's agents,
employees, invitees, licensees or contractors of any Environmental Law,
including the assertion of any lien thereunder and any suit brought or judgment
rendered regardless of whether the action was commenced by a citizen (as
authorized under the Environmental Laws) or by a government agency;
B. To the extent caused by Tenant or Tenant's agents, employees,
invitees, licensees or contractors, any spill or release of or the presence of
any Hazardous Waste affecting the Project whether or not the same originates or
emanates from the Project or any contiguous real estate, including any loss of
value of the Project as a result of a spill or release of or the presence of any
Hazardous Waste;
C. To the extent caused by Tenant or Tenant's agents, employees,
invitees, licensees or contractors, any other matter affecting the Project
within the jurisdiction of the United States Environmental Protection Agency,
the Nevada State Environmental Commission, the Nevada Department of Conservation
and Natural Resources, or the Nevada Department of Commerce, including costs of
investigations, remedial action, or other response costs whether such costs are
incurred by the United States Government, the State of Nevada, or any
Indemnitee;
D. To the extent caused by Tenant or Tenant's agents, employees,
invitees, licensees or contractors, liability for clean-up costs, fines, damages
or penalties incurred pursuant to the provisions of any applicable Environmental
Law; and
E. To the extent caused by Tenant or Tenant's agents, employees,
invitees, licensees or contractors, liability for personal injury or property
damage arising under any statutory or common-law tort theory, including, without
limitation, damages assessed for the maintenance of a public or private
nuisance, or for the carrying of an abnormally dangerous activity, and response
costs.
Landlord shall promptly provide notice of any claims for which Tenant
is to indemnify Landlord hereunder, and Landlord and Tenant shall reasonably
cooperate in the defense of the claims. Tenant's obligations under this Article
7. shall survive the termination of this Lease.
7.05 Remedial Acts. In the event of any spill or release of or the
presence of any Hazardous Waste affecting the Project, caused by Tenant, its
employees, agents, invitees, licensees, or contractors, whether or not the same
originates or emanates from the Project or any contiguous real estate, and/or if
Tenant shall fail to comply with any of the requirements of any Environmental
Law, Landlord may, upon ten (10) business days notice to Tenant (except in the
case of emergency, for which no notice is required), at its election, but
without obligation so to do, give such notices and/or cause such work to be
performed at the Project and/or take any and all other actions as Landlord shall
deem necessary or advisable in order to remedy said spill or release of
Hazardous Waste or cure said failure of compliance and any amounts paid as a
result thereof, together with interest at the rate equal to the product of the
variable Prime Rate "Prime", plus six percent (6%) per annum as charged by Bank
of America, Nevada; times the amount of such installment amount due, or eighteen
percent (18%) per annum of such installment or the sum of twenty-five dollars
($25.00), whichever is greater, for each month or fractional month transpiring
from the date due until paid.
7.06 Settlement. Landlord upon giving Tenant ten (10) business days
prior notice, shall have the right in good faith to pay, settle or compromise,
or litigate any claim, demand, loss, liability, cost, charge, suit, order,
judgment or adjudication under the belief that it is liable therefor, whether
liable or not, without the consent or approval of Tenant unless Tenant within
said ten (10) business day period shall protest in writing and simultaneously
with such protest deposit with Landlord collateral satisfactory to Landlord
sufficient to pay and satisfy any penalty and/or interest which may accrue as a
result of such protest and any judgment or judgments as may result, together
with attorney's fees and expenses, including, but not limited to, environmental
consultants.
7.07 Landlord's Representations and Indemnity. Landlord shall comply
with all Environmental Laws and shall utilize its reasonable best efforts to
promptly notify Tenant of the violation of any Environmental Law or presence of
any Hazardous Waste in violation of any Environmental Law on the Premises
whenever Landlord knows or suspects of any such violation. Landlord represents
and warrants to Tenant that, as of the date of this Lease, Landlord has received
no written notice from any governmental or administrative entity having
jurisdiction over the Premises notifying Landlord that Hazardous Waste is
present on, in, or under the Premises in violation of any Environmental Law.
Landlord shall indemnify, protect, defend (by counsel reasonably acceptable to
Tenant) and hold harmless Tenant and its partners, directors, officers,
employees, shareholders, lenders, agents, contractors, and each of their
respective successors and assigns, from and against any and all claims,
judgments, causes of action, damages, penalties, fines, taxes, costs,
liabilities, losses and expenses arising at any time during or after the term of
this Lease as a result of (i) a breach of the representation as is set forth in
the immediately preceding sentence of this Section 7.07, or (ii) was authorized
by Landlord or caused by the acts or omissions of Landlord, its employees,
agents, contractors, or predecessors, and was not initially caused by Tenant, or
Tenant's employees, agents, invitees, customers, licensees, or contractors.
Tenant shall promptly provide notice of any claims for which Landlord is to
indemnify Tenant hereunder and Tenant and Landlord shall reasonably cooperate in
the defense of the claims. Landlord's obligations pursuant to the foregoing
indemnity shall survive the termination of this Lease.
8. PARKING
8.01 Tenant and Tenant's customers, suppliers, employees, and invitees
have the non-exclusive right to park in common with other lessees in the parking
facilities as designated by Landlord and as otherwise set forth in this Lease.
Tenant agrees not to overburden the parking facilities and agrees to cooperate
with Landlord and other lessees in the use of the parking facilities. Landlord
reserves the right to, on an equitable basis, assign specific spaces without
charge to Tenant, make changes in the parking layout from time to time, and to
establish reasonable time limits on parking.
9. UTILITIES
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9.01 Tenant will be responsible for and shall pay for all water, gas,
heat, light, power, sewer, electricity, or other services metered, chargeable to
or provided to the Premises separate from and in addition to the costs outlined
in Section 5.02 dealing with the utility costs for Common Area Maintenance.
Landlord reserves the right to install separate meters for any such utility.
9.02 Landlord will not be liable or deemed in default to Tenant nor
will there be any abatement of rent for any interruption or reduction of
utilities or services not caused by any act of Landlord or any act reasonably
beyond Landlord's control. Tenant agrees to comply with energy conservation
programs implemented by Landlord by reason of enacted laws or ordinances.
9.03 Tenant will contract and pay for all telephone and such other
services for the Premises subject to the provisions of 10.03.
10. ALTERATIONS, MECHANIC'S LIENS
10.01 Except for nonstructural changes, alterations, or additions which
do not decrease the value of the Premises, Tenant will not make any alterations
to the Premises without Landlord's prior written consent. Landlord's consent
shall be contingent upon Tenant providing Landlord with the following items or
information, all subject to Landlord's approval which approval shall not be
unreasonably withheld in accordance with the provisions of this Article 10: (i)
Tenant's contractor, (ii) certificates of insurance by Tenant's contractor for
commercial general liability insurance with limits not less than $2,000,000
General Aggregate,$1,000,000 Products/Complete Operations Aggregate,$1,000,000
Personal & Advertising Injury, $1,000,000 Each Occurrence, $50,000 Fire Damage,
$5,000 Medical Expense, $1,000,000 Auto Liability (Combined Single Limit,
including Hired/Non-Owned Auto Liability), Workers Compensation, including
Employer's Liability, as required by state statute endorsed to show Landlord as
an additional insured and for worker's compensation as required and (iii)
detailed plans and specifications for such work. Tenant agrees that it will have
its contractor execute a waiver of mechanic's lien and that Tenant will remove
any mechanic's lien placed against the Project or provide a bond or other
collateral in an amount and on such terms as are acceptable to Landlord in
Landlord's reasonable discretion (it being agreed that Landlord may require
removal of and Tenant shall immediately remove any such liens if so required by
Landlord's lenders or otherwise to finance or refinance the Project or Premises)
within ten (10) days of receipt of notice of lien. In addition, before
alterations may begin, valid building permits or other permits or licenses
required must be furnished to Landlord, and, once the alterations begin, Tenant
will diligently and continuously pursue their completion. At Landlord's option,
any alterations may become part of the realty and belong to Landlord. As a
further condition to giving such consent, Landlord may require Tenant to provide
Landlord, at Tenant's sole cost and expense, a payment and performance bond in
form acceptable to Landlord, in a principal amount not less than one and
one-half times the estimated costs of such alterations, to ensure Landlord
against any liability for mechanic's and materialmen's liens and to ensure
completion of work. Tenant, at Landlord's option, shall at Tenant's expense
remove all alterations and repair all damage to the Premises.
10.02 Notwithstanding anything in 10.01, Tenant may, with written
consent of Landlord, install trade fixtures, equipment, and machinery in
conformance with the ordinances of the applicable city and county, and they may
be removed upon termination of its Lease provided the Premises are not damaged
by their removal.
10.03 Any private telephone systems and/or other related
telecommunications equipment and lines must be installed within Tenant's
Premises and, if requested in writing by Landlord, upon termination of this
Lease removed and the Premises restored to the same condition as before such
installation.
10.04 Tenant will pay all costs for alterations and will keep the
Premises, the Project and the underlying property free from any liens arising
out of work performed for, materials furnished to or obligation incurred by
Tenant or otherwise provide a bond or other collateral in an amount and on such
terms as are acceptable to Landlord in Landlord's reasonable discretion (it
being agreed that Landlord may require removal of and Tenant shall remove any
such liens if so required by Landlord's lenders or otherwise to finance or
refinance the Project or Premises).
10.05 Landlord will have the right to construct or permit construction
of tenant improvements in or about the Project for existing and new Tenants and
to alter any public areas in and around the Project. Notwithstanding anything
which may be contained in this Lease, Tenant understands this right of Landlord
and agrees that such construction will not be deemed to constitute a breach of
this Lease by Landlord and Tenant waives any such claim which it might have
arising from such construction. Landlord agrees to conduct or permit such
construction so that such construction shall not materially and unreasonably
interfere with Tenant's ability to conduct its business on the Premises to the
extent reasonably possible.
11. FIRE INSURANCE: HAZARDS AND LIABILITY INSURANCE
11.01 Except as expressly provided as Tenant's Permitted Use, or as
otherwise consented to by Landlord in writing, Tenant shall not do or permit
anything to be done within or about the Premises which Tenant knows or
reasonably believes will increase the existing rate of insurance on the Project
and shall, at its sole cost and expense, comply with any requirements,
pertaining to the Premises, of any insurance organization insuring the Project
and Project-related apparatus. Upon prompt notice of such increase, Tenant
agrees to pay to Landlord, as Additional Rent, any increases in premiums on
policies resulting from Tenant's Permitted Use or other use consented to by
Landlord which increases Landlord's premiums or requires extended coverage by
Landlord to insure the Premises. Landlord agrees to provide Tenant with a
reasonable opportunity to cure such condition.
11.02 Tenant, at all times during the term of this Lease and at
Tenant's sole expense, will maintain a policy of standard fire and extended
coverage insurance with "all risk" coverage on all Tenant's improvements and
alterations in or about the Premises and on all personal property and equipment
to the extent of at least ninety percent (90%) of their full replacement value.
The proceeds from this policy will be used by Tenant for the replacement of
personal property and equipment and the restoration of Tenant's improvements
and/or alterations. This policy will contain an express waiver, in favor of
Landlord, of any right of subrogation by the insurer.
11.03 Tenant, at all times during the term on this Lease and at
Tenant's sole expense, will maintain a policy of commercial general liability
coverage with limits of not less than $2,000,000 combined single limit for
bodily injury and property damage insuring against all liability of Tenant and
its authorized representatives arising out of or in connection with Tenant's use
or occupancy of the Premises.
11.04 All insurance will name Landlord and/or Landlord's designated
partners and affiliates as an additional insured and will include an express
waiver of subrogation by the insurer in favor of Landlord and Tenant and will
release Landlord from any claims for damage to any person, to the Premises, and
to the Project, and to Tenant's personal property, equipment, improvements and
alterations in or on the Premises of the Project, caused by or resulting from
risks which are to be insured against by Tenant under this Lease. All insurance
required to be provided by Tenant under this Lease will (a) be issued by an
insurance company authorized to do business in the state in which the Premises
are located and which has and maintains a rating of A/X in the Best's Insurance
Reports or the equivalent, (b) be primary and noncontributing with any insurance
carried by Landlord, and (c) contain an endorsement requiring at least thirty
(30) days prior written notice of cancellation to Landlord before cancellation
or change in coverage, scope or limit of any policy. Tenant will deliver a
certificate of insurance or a copy of the policy to Landlord within thirty (30)
days of execution of this Lease and will provide evidence of renewed insurance
coverage at each anniversary, and prior to the expiration of any current
policies; however, in no event will Tenant be allowed to occupy the Premises
before providing adequate and acceptable proof of insurance as stated above.
Tenant's failure to provide evidence of this coverage to Landlord within ten
(10) business days of notice from Landlord, may, in Landlord's sole discretion,
constitute a default under this Lease.
12. INDEMNIFICATION AND WAIVER OF CLAIMS
12.01 Except as caused by the negligence or intentional misconduct of
Landlord, its employees, agents, visitors, invitees, licenses, or contractors,
Tenant waives all claims against Landlord for damage to any property in or about
the Premises and for injury to any persons, including death resulting therefrom,
regardless of cause or time of occurrence. Tenant will defend (with counsel
reasonably acceptable to Landlord), indemnify and hold Landlord harmless from
and against any and all claims, actions, proceedings, expenses, damages and
liabilities, including attorney's fees, arising out of, connected with, or
resulting from any use of the Premises by Tenant, its employees, agents,
visitors
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or licensees, including, without limitation, any failure of Tenant to comply
fully with all of the terms and conditions of this Lease except for any damage
or injury which is the result of the negligence or intentional misconduct or
omission by Landlord, its employees, agents, visitors, licensees or contractors.
Landlord shall give Tenant prompt notice of any claim for which Tenant is to
indemnify, defend, and hold harmless Landlord hereunder and Landlord shall
reasonably cooperate with Tenant.
13. REPAIRS
13.01 Tenant shall, at its sole expense, keep and maintain the Premises
and every part thereof (excepting common use equipment, which Landlord agrees to
repair or replace pursuant to Section 5.02 unless damages are due to the neglect
or intentional acts of Tenant or its agents, employees, visitors, or licensees),
including interior windows, skylights, doors, plate glass, any store fronts and
the interior of the Premises, in good and sanitary order, condition and repair.
Tenant will, also, at its sole cost keep and maintain all utilities, fixtures,
plumbing and mechanical equipment used by Tenant in good order and repair and
furnish all expendables (light bulbs, paper goods, soaps, etc.) used in the
Premises. The standard for comparison and need of repair will be the condition
of the Premises at the time of commencement of this Lease and all repairs will
be made by a licensed and bonded contractor approved by Landlord.
13.02 Except as specified in 13.01, Tenant will not make repairs to the
Premises at the cost of Landlord whether by deductions of rent or otherwise, or
vacate the Premises or terminate the Lease if repairs are not made. If during
the Term, any alteration, addition or change to the Premises is required by
legal authorities, Tenant, at its sole expense, shall promptly make the same.
Landlord reserves the right to make any such repairs not made or maintained in
good condition by Tenant and Tenant shall reimburse Landlord for all such costs
upon demand.
13.03 If repairs deemed necessary by Landlord or any government
authority are not made by Tenant within the prescribed time frame as reasonably
requested in writing, Tenant shall be in default of this Lease.
13.04 Tenant shall, at its own expense, within thirty days of lease
commencement, contract with a vendor acceptable to Landlord for the maintenance
service of the HVAC which will be furnished to the Landlord upon request. If
Tenant fails to obtain and maintain such a maintenance service contract Landlord
shall have the right to obtain such a maintenance service contract at the
expense of Tenant.
14. AUCTIONS, SIGNS, AND LANDSCAPING
14.01 Tenant will not conduct or permit to be conducted any sale by
auction on the Premises. Landlord will have the right to control landscaping and
approve the placement, size, and quality of signs pursuant to Exhibit "G", "Sign
Criteria". Tenant will not make alterations or additions to the landscaping and
will not place any signs nor allow the placement of any signs, which are visible
from the outside, on or about any building of the Project, nor in any landscape
area, without the prior written consent of Landlord, which consent shall not be
unreasonably withheld or delayed. Any signs not in conformity with this Lease or
in accordance with the provisions of Exhibit "G" may be removed by Landlord at
Tenant's expense.
15. ENTRY BY LANDLORD
15.01 Tenant will permit Landlord and Landlord's agents to enter the
Premises at all reasonable times and upon reasonable notice (except in the case
of emergency) for the purpose of inspecting the same, or for the purpose of
maintaining the Project, or for the purpose of making repairs, alterations or
additions to any portion of the Project, including the erection and maintenance
of such scaffolding, canopies, fences and props as may be required, or for the
purpose of posting notices of nonresponsibility for alterations, additions or
repairs , or for the purpose of showing the Premises to prospective tenants
during the last six months of the Lease Term, or placing upon the Project any
usual or ordinary "for sale" signs, without any rebate of rents and without any
liability to Tenant for any loss of occupation or quiet enjoyment of the
Premises thereby occasioned. Tenant will permit Landlord at any time within
sixty (60) days prior to the expiration of this Lease, to place upon the
Premises any usual or ordinary "to let" or "to lease" signs. Landlord retains
the right to charge Tenant for restoring any altered doors to their condition
prior to the installation of the new or additional locks.
16. ABANDONMENT
16.01 Tenant will not vacate or abandon the Premises, which shall be
deemed to occur any time during the Lease Term if Tenant does not conduct
business for a period of fifteen (15) consecutive days and/or leaves the
Premises unoccupied for any period of time. If Tenant abandons, vacates or
surrenders the Premises, or is dispossessed by process of law, or otherwise, any
personal property belonging to Tenant left in or about the Premises will, at the
option of Landlord be deemed abandoned and may be disposed of by Landlord in the
manner provided for by the laws of the state in which the Premises are located.
17. DESTRUCTION
17.01 In the case of destruction of more than fifty percent (50%) of
the Premises, or any portion thereof substantially interfering with Tenant's use
of the Premises, whether by fire or other casualty, not caused by the fault or
negligence of Tenant, its agents, employees, servants, contractors, subtenants,
licensees, customers or business invitees, this Lease shall terminate except as
herein provided. If Landlord notifies Tenant in writing within forty-five (45)
days of such destruction of Landlord's election to repair said damage, and if
Landlord proceeds to and does repair such damage within One Hundred Eighty (180)
days of such damage, this Lease shall not terminate, but shall continue in full
force and effect, except that Tenant shall be entitled to a reduction in the
minimum rent in an amount equal to that proportion of the minimum rent which the
number of square feet of floor space in the unusable portion bears to the total
number of square feet of floor space in the Premises. Said reduction shall be
prorated so that the rent shall only be reduced for those days any given area is
actually unusable. The time of completion of repair of such damage shall be
extended for, delays caused by labor disputes, civil commotion, war, warlike
operations, invasion, rebellion, hostilities, military or usurped power,
sabotage, governmental regulations or control, fire or other casualty, inability
to obtain any materials or services, acts of God and other causes beyond
Landlord's control. If this Lease is terminated pursuant to this Section 17 and
if Tenant is not in default hereunder, Rent shall be prorated as of the date of
termination, any security deposited with Landlord shall be returned to Tenant,
less any reasonable offsets and all rights and obligations hereunder shall cease
and terminate.
17.02. Notwithstanding the foregoing provisions, in the event the
Premises, or any portion thereof, shall be damaged by fire or other casualty
caused by the fault or negligence of Tenant, its agents, employees, servants,
contractors, subtenants, licensees, customers or business invitees, then,
without prejudice to any other rights and remedies of Landlord, this Lease shall
not terminate, the damage shall be repaired at Tenant's cost, and there shall be
no apportionment or abatement of any rent.
17.03. In the event of any damage not limited to, or not including, the
Premises, such that the building of which the Premises is a part is damaged to
the extent of twenty-five (25%) percent or more of the cost of replacement, or
the buildings (taken in the aggregate) of the Project owned by Landlord shall be
damaged to the extent of more than twenty-five (25%) of the aggregate cost of
replacement, Landlord may elect to terminate this Lease upon giving notice of
such election in writing to Tenant within ninety (90) days after the occurrence
of the event causing the damage.
17.04. The provisions of this Section 17 with respect to Landlord shall
be limited to such repair as is necessary to place the Premises in the condition
specified for Landlord's work by Exhibit B (if applicable) and when placed in
such condition the Leased Property shall be deemed restored and rendered
tenantable promptly following which time Tenant, at Tenant's expense shall
perform Tenant's work required by Exhibit B (if applicable) unless such
destruction was caused by the negligence or intentional misconduct of Landlord,
or Landlord's employees, agents, visitors, contractors, invitees, or licenses,
and Tenant shall also repair or replace its stock in trade, fixtures, furniture,
furnishings, floor coverings and equipment, and if Tenant has closed, Tenant
shall promptly reopen for business.
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17.05. All insurance proceeds payable under any fire, and/or rental
insurance shall be payable solely to Landlord and Tenant shall have no interest
therein. Tenant shall in no case be entitled to compensation for damages on
account of any annoyance or inconvenience in making repairs under any provision
of this Lease. Except to the extent provided for in this Section 17, neither the
rent payable by Tenant nor any of Tenant's other obligations under any provision
of this Lease shall be affected by any damage to or destruction of the Premises
or any portion thereof by any cause whatsoever.
18. ASSIGNMENT, SUBLETTING AND TRANSFERS OF OWNERSHIP
18.01 Except for a "Permitted Assignment," as defined in Section 18.02
below, Tenant will not, without Landlord's prior written consent, assign,
sublease sell, mortgage, encumber, convey or otherwise transfer all or any part
of Tenant's leasehold estate, or permit the Premises to be occupied by anyone
other than Tenant and Tenant's employees or sublet the Premises or any portion
thereof (collectively called "Transfer"). Tenant must supply Landlord with any
and all documents deemed necessary by Landlord to evaluate any proposed Transfer
and with respect to a Permitted Assignment at least sixty (60) days in advance
of Tenant's proposed Transfer date or the date of a Permitted Assignment.
18.02 Except for a "Permitted Assignment," as defined hereinbelow,
Landlord need not consent to any Transfer for reasons including, but not limited
to, whether or not: (a) in the reasonable judgment of Landlord the transferee is
of a character or is engaged in a business which is not in keeping with the
standard of Landlord for the Project; (b) in the reasonable judgment of Landlord
any purpose for which the transferee intends to use the Premises is not in
keeping with the standards of Landlord for the Project; provided in no event may
any purpose for which transferee intends to use the Premises be in violation of
this Lease; (c) the portion of the Premises subject to the transfer is not
regular in shape with appropriate means of entering and exiting, including
adherence to any local, county or other governmental codes, or is not otherwise
suitable for the normal purposes associated with such a Transfer; or (d) Tenant
is in default under this Lease or any other Lease with Landlord. Notwithstanding
the foregoing provisions of this Section 18.02, and provided that Tenant
complies with all other provisions of this Article 18, Landlord hereby consents
to the assignment of the Lease to MicroAge, Inc., a Delaware corporation, or any
wholly-owned subsidiary corporation of MicroAge, Inc. (a "Permitted
Assignment"). No Permitted Assignment shall release or otherwise affect Tenant's
or any guarantor's obligations under this Lease, or constitute an express or
implied consent to any other Transfer of all or any part of Tenant's leasehold
estate, or the occupation by anyone other than Tenant or Tenant's employees.
18.03 In the event Landlord consents to a Transfer or in the event of a
Permitted Assignment, Tenant will pay Landlord fifty percent (50%) of the
excess, if any, of the rent and other charges reserved in the Transfer or
Permitted Assignment over the allocable portion of the rent and other charges
hereunder for that portion of the Premises subject to the Transfer or Permitted
Assignment. For the purpose of this section, the rent reserved in the Transfer
will be deemed to include any lump sum payment or other consideration given to
Tenant in consideration for the Transfer or Permitted Assignment. Tenant will
pay or cause the transferee to pay to Landlord this additional rent together
with the monthly installments of rent due.
18.04 Any consent to any Transfer which may be given by Landlord, or
any Permitted Assignment, or the acceptance of any rent, charges or other
consideration by Landlord from Tenant or any third party, will not constitute a
waiver by Landlord of the provisions of this Lease or a release of Tenant from
the full performance by it of the covenants stated herein; and any consent given
by Landlord to any Transfer, or any Permitted Assignment, will not relieve
Tenant (or any transferee of Tenant) from the above requirements for obtaining
the written consent of Landlord to any subsequent Transfer.
18.05 If a default under this Lease should occur while the Premises or
any part of the Premises are Transferred, assigned, sublet or otherwise
transferred (including, without limitation, a Permitted Assignment), Landlord,
in addition to any other remedies provided for within this Lease or by law, may
at its option collect directly from the transferee all rent or other
consideration becoming due to Tenant under the Transfer or Permitted Assignment
and apply these monies against any sums due to Landlord by Tenant; and Tenant
authorizes and directs any transferee to make payments of rent or other
consideration direct to Landlord upon receipt of notice from Landlord. No direct
collection by Landlord from any transferee should be construed to constitute a
novation or a release of Tenant or any guarantor of Tenant from the further
performance of its obligations in connection with this Lease.
18.06 If Tenant is a corporation or a partnership, the issuances of any
additional stock or equity interest and/or the transfer, assignment or
hypothecation of any stock or interest in such corporation or partnership in the
aggregate in excess of Twenty-five percent (25%) of such interests, as the same
may be constituted as of the date of this Lease, whether directly or indirectly,
shall be deemed to be a Transfer within the meaning of this Section 18.
Notwithstanding the foregoing, Tenant may issue additional stock and/or
transfer, assign, or hypothecate all or any portion of Tenant's stock, as the
same may be constituted as of the date of this Lease, whether directly or
indirectly, to MicroAge, Inc. or any wholly owned subsidiary of MicroAge, Inc.
and the same shall not constitute a Transfer within the meaning of this Article
18. In the event of any such stock issuance or transfer, the same shall not
constitute consent by Landlord to any further stock issuance or transfer, nor
shall it affect this Lease or any of Tenant's or any guarantor's obligations
hereunder.
18.07 In the event Tenant requests Landlord's consent to an Assignment,
Sub-Let or Transfer of Tenant's interest in the leased Premises or in the case
of a Permitted Assignment, Tenant agrees to pay Landlord all reasonable
attorney's fees incurred by Landlord for any legal services for document review
of any and all documents deemed necessary by Landlord and Tenant to Assign,
Sub-let or Transfer Tenant's interest in the leased Premises.
19. BREACH BY TENANT
19.01 Tenant will be in breach of this Lease if at any time during the
term of this Lease (and regardless of the pendency of any bankruptcy,
reorganization, receivership, insolvency or other proceedings in law, in equity
or before any administrative tribunal which have or might have the effect of
preventing Tenant from complying with the terms of this Lease):
A. Tenant fails to make payment of any installment of Base Monthly
Rent, Additional Rent, or of any other sum herein specified to be paid by Tenant
within ten (10) days of the date such sum was due under this Lease; and after
three (3) days following notice from Landlord of such breach; or
B. Tenant fails to observe or perform any of its other covenants,
agreements or obligations hereunder, and such failure is not cured within ten
(10) business days after Landlord's written notice to Tenant of such failure;
provided, however, that if the nature of Tenant's obligation is such that more
than ten (10) business days are required for performance, then Tenant will not
be in breach if Tenant commences performance within such 10 business day period
and thereafter diligently prosecutes the same to completion; or
C. Tenant, Tenant's assignee, subtenant, guarantor, or occupant of
the Premises becomes insolvent, makes a transfer in fraud of its creditors,
makes a transfer for the benefit of its creditors, is the subject of a
bankruptcy petition, is adjudged bankrupt or insolvent in proceedings filed
against Tenant, a receiver, trustee, or custodian is appointed for all or
substantially all of Tenant's assets, fails to pay its debts as they become due,
convenes a meeting of all or a portion of its creditors, or performs any acts of
bankruptcy or insolvency, including the selling of its assets to pay creditors;
or
D. Tenant has abandoned the Premises as defined in paragraph 16
above.
20. REMEDIES OF LANDLORD
20.01 Nothing contained herein shall constitute a waiver of Landlord's
right to recover damages by reason of Landlord's efforts to mitigate the damage
to it by Tenant's default; nor shall anything in this Section adversely affect
Landlord's right, as in this Lease elsewhere provided, to indemnification
against liability for injury or damages to persons or property occurring prior
to a termination of this Lease.
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20.02 All cure periods provided herein shall run concurrently with any
periods provided by law.
20.03 In the event of default, as designated herein above, in addition
to any other rights or remedies provided for herein or at law or in equity,
Landlord, at its sole option, shall have the following rights:
A. The right to declare the term of this Lease ended and reenter the
Premises and take possession thereof, and to terminate all of the rights of
Tenant in and to the Premises.
B. The right, without declaring the term of this Lease ended, to
reenter the Premises and to occupy the same, or any portion there of, for and on
account of the Tenant as hereinafter provided, and Tenant shall be liable for
and pay to Landlord on demand all such expenses as Landlord may have paid,
assumed or incurred in recovering possession of the Premises, including
reasonable costs, expenses, attorney's fees and expenditures placing the same in
good order, or preparing or altering the same for reletting, and all other
reasonable expenses, commissions and charges paid by the Landlord in connection
with reletting the Premises. Any such reletting may be for the remainder of the
term of this Lease or for a longer or shorter period. Such reletting shall be
for such rent and on such other terms and conditions as Landlord, in its sole
discretion, deems appropriate. Landlord may execute any lease made pursuant to
the terms hereof either in the Landlord's own name or in the name of Tenant or
assume Tenant's interest in any existing subleases to any tenant of the
Premises, as Landlord may see fit, and Tenant shall have no right or authority
whatsoever to collect any rent from such tenants, subtenants, of the Premises.
In any case, and whether or not the Premises or any part thereof is relet,
Tenant, until the end of the Lease term shall be liable to Landlord for an
amount equal to the amount due as Rent hereunder, less net proceeds, if any of
any reletting effected for the account of Tenant. Landlord reserves the right to
bring such actions for the recovery of any deficits remaining unpaid by the
Tenant to the Landlord hereunder as Landlord may deem advisable from time to
time without being obligated to await the end of the term of the Lease.
Commencement of maintenance of one or more actions by the Landlord in this
connection shall not bar the Landlord from bringing any subsequent actions for
further accruals. In no event shall Tenant be entitled to any excess rent
received by Landlord over and above that which Tenant is obligated to pay
hereunder; or
C. The right, even though it may have relet all or any portion of the
Premises in accordance with the provisions of subsection B. above, to thereafter
at any time elect to terminate this Lease for such previous default on the part
of the Tenant, and to terminate all the rights of Tenant in and to the Premises.
20.04 Pursuant to the rights of re-entry provided above, Landlord may
remove all persons from the Premises and may, but shall not be obligated to,
remove all property therefrom, and may, but shall not be obligated to, enforce
any rights Landlord may have against said property or store the same in any
public or private warehouse or elsewhere at the cost and for the account of
Tenant or the owner or owners thereof. Tenant agrees to hold Landlord free and
harmless from any liability whatsoever for the removal and/or storage of any
such property, whether of Tenant or any third party whomsoever. Such action by
the Landlord shall not be deemed to have terminated this Lease.
20.05 If Tenant breaches this Lease and abandons the Premises before
the end of the term, or if its right of possession is terminated by Landlord
because of Tenant's breach of this Lease, then this Lease may be terminated by
Landlord at its option. On such Termination Landlord may recover from Tenant, in
addition to the remedies permitted at law:
A. The worth, at the time of the award, of the unpaid Base Monthly
Rents and Additional Rents which had been earned at the time this Lease is
terminated.
B. The worth, at the time of the award, of the amount by which the
unpaid Base Monthly Rents and Additional Rents which would have been earned
after the date of termination of this Lease until the time of award exceeds the
amount of the loss of rents that Tenant proves could be reasonably avoided;
C. The worth, at the time of the award, of the amount by which the
unpaid Base Monthly Rent and Additional Rents for the balance of the Lease Term
after the time of award exceeds the amount of such rental loss for such period
as the Tenant proves could have been reasonably avoided; and
D. Any other amount, and court costs, necessary to compensate
Landlord for all detriment proximately caused by Tenant's breach of its
obligations under this Lease, or which in the ordinary course of events would be
likely to result therefrom. The detriment proximately caused by Tenant's breach
will include, without limitation, (i) reasonable expenses for cleaning,
repairing or restoring the Premises, (ii) reasonable expenses for altering,
remodeling or otherwise improving the Premises for the purpose of reletting the
Premises, (iii) reasonable brokers' fees and commissions, and advertising costs
for the purpose of reletting the Premises, and such other expenses as may be
required by a new tenant, , (iv) costs of carrying the Premises such as taxes,
insurance premiums, utilities and security precautions, (v) expenses of retaking
possession of the Premises, (vi) reasonable attorney's fees and court costs,
(vii) any unearned brokerage commissions paid in connection with this Lease,
(viii) reimbursement of any previously waived Base Rent, Additional Rent, free
rent or reduced rental rate, and (ix) any concession made or paid by Landlord to
the benefit of Tenant in consideration of this Lease including, but not limited
to, any moving allowances, contributions or payments by Landlord for tenant
improvements or build-out allowances or assumptions by Landlord of any of the
Tenant's previous lease obligations.
20.06 In any action brought by either party to enforce any of its
rights under or arising from this Lease, the prevailing party shall be entitled
to receive its costs and legal expenses including reasonable attorneys' fees,
whether or not such action is prosecuted to judgment.
20.07 The waiver by either party of any breach or default of the other
party hereunder shall not be a waiver of any preceding or subsequent breach of
the same or any other term. Acceptance of any Rent payment shall not be
construed to be a waiver of the Landlord of any preceding breach of the Tenant.
20.08 All past due amounts owed by Tenant or Landlord under the terms
of this Lease shall bear interest at twelve percent (12%) per annum unless
otherwise stated.
21. SURRENDER OF LEASE NOT MERGER
21.01 The voluntary or other surrender of this Lease by Tenant, or
mutual cancellation thereof, will not work a merger and will, at the option of
Landlord, terminate all or any existing transfers, or may, at the option of
Landlord, operate as an assignment to it of any or all of such transfers.
22. ATTORNEYS FEES/COLLECTION CHARGES
22.01 In the event of any legal action or proceeding between the
parties hereto, reasonable attorneys' fees and expenses of the prevailing party
in any such action or proceeding will be added to the judgment therein. Should
Landlord be named as defendant in any suit brought against Tenant in connection
with or arising out of Tenant's occupancy hereunder and not caused by Landlord's
negligence or intentional misconduct, Tenant will pay to Landlord its costs and
expenses incurred in such suit, including reasonable attorney's fees. Landlord
shall promptly notify Tenant of any claim or expense for which Tenant is to
indemnify Landlord pursuant to the preceding sentence and Landlord shall
reasonably cooperate with Tenant. Tenant's obligations hereunder shall survive
the termination of this Lease.
22.02 If Landlord utilizes the services of any attorney at law for the
purpose of collecting any rent due and unpaid by Tenant after receipt of five
(5) days written notice to Tenant of such nonpayment of rent or in connection
with any other breach of this Lease by Tenant, Tenant agrees to pay Landlord
reasonable attorneys' fees as determined by Landlord for such services,
regardless of the fact that no legal action may be commenced or filed by
Landlord
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23. CONDEMNATION
23.01 If fifty percent (50%) or more of the square footage of the
Premises or in the event any portion of the Premises substantially interfering
with Tenant's use thereof is taken for any public or quasi-public purpose by any
lawful government power or authority, by exercise of the right of appropriation,
reverse condemnation, condemnation or eminent domain, or sold to prevent such
taking, and if the remaining portion of the Premises will be reasonably adequate
for the operation of Tenant's business after Landlord completes such repairs or
alterations as Landlord elects to make, either Tenant or the Landlord may at its
option terminate this Lease by notifying the other party hereto of such election
in writing within twenty (20) days after such taking. Tenant will not because of
such taking assert any claim against the Landlord or the taking authority for
any compensation because of such taking, and Landlord will be entitled to
receive the entire amount of any award without deduction for any estate of
interest of Tenant. If less than twenty-five percent (25%) of the Premises is
taken or if the taking does not substantially interfere with Tenant's use of the
Premises, Landlord at its option may terminate this Lease. If Landlord does not
so elect, Landlord will promptly proceed to restore the Premises to
substantially its same condition prior to such partial taking, allowing for any
reasonable effects of such taking, and a proportionate allowance based on the
loss of square footage will be made to Tenant for the rent corresponding to the
time during which, and to the part of the Premises, which, Tenant is deprived on
account of such taking and restoration.
24. RULES AND REGULATIONS
24.01 Tenant will faithfully observe and comply with any reasonable
Rules and Regulations promulgated by Landlord for the Project and Landlord
reserves the right to modify and amend them as it deems necessary. Landlord will
not be responsible to Tenant for the nonperformance by any other Tenant or
occupant of the Project of any of said Rules and Regulations.
24.02 In the event that Tenant fails to cure any violations of such
Rules and Regulations following ten (10) business days written notice by
Landlord, such failure to cure shall be deemed a material breach of this Lease
by Tenant.
25. ESTOPPEL CERTIFICATE
25.01 Tenant will execute and deliver to Landlord, within ten (10)
business days of Landlord's written demand, a statement in writing certifying
that this Lease is in full force and effect, and that the Base Monthly Rent and
Additional Rent payable hereunder is unmodified and in full force and effect
(or, if modified, stating the nature of such modification) and the date to which
rent and other charges are paid, if any, and acknowledging that there are not,
to Tenant's knowledge, any uncured defaults on the part of Landlord hereunder or
specifying such defaults if they are claimed and such other matters as Landlord
may reasonably request and which do not diminish Tenant's rights under this
Lease. Any such statement may be conclusively relied upon by any prospective
purchaser or encumbrancer of the Premises. Tenant's failure to deliver such
statement within such time shall be conclusive upon Tenant that (1) this Lease
is in full force and effect, without modification except as may be represented
by Landlord; (2) to Tenant's knowledge there are no uncured defaults in
Landlord's performance, and (3) not more than one (1) month's rents has been
paid in advance.
26. SALE BY LANDLORD
26.01 Provided that any successor agrees in writing to be bound as
Landlord under this Lease, in the event of a sale or conveyance by Landlord of
the Project the same shall operate to release Landlord from any liability upon
any of the covenants or conditions, expressed or implied, herein contained in
favor of Tenant which accrue or occur, or for which Landlord may become
obligated, subsequent to such sale or transfer, and in such event Tenant agrees
to look solely to the responsibility of the successor in interest of Landlord in
and to this Lease. This Lease will not be affected by any such sale, and,
provided that any successor agrees in writing to be bound as Landlord under this
Lease, Tenant agrees to attorn to the purchaser or assignee.
27. NOTICES
27.01 All notices, statements, demands, requests, consents, approvals,
authorizations, offers, agreements, appointments, or designations under this
Lease by either party to the other will be in writing and will be considered
sufficiently given and served upon the other party (1) five (5) days after
mailing by certified or registered mail, return receipt requested, postage
prepaid, (2) upon personal delivery by any legitimate third party, or (3) upon
receipt from a national overnight delivery service for next day delivery, and
addressed as indicated in Sections 1.03 and 1.04.
28. WAIVER
28.01 The failure of either party to insist in any one or more cases
upon the strict performance of any term, covenant or condition of the Lease will
not be construed as a waiver of a subsequent breach of the same or any other
covenant, term or condition; nor shall any delay or omission by the other party
to seek a remedy for any breach of this Lease be deemed a waiver by such party
of its remedies or rights with respect to such a breach.
29. HOLDOVER
29.01 If Tenant remains in the Premises after the Lease Expiration Date
with the consent of the Landlord, and has not given prior written notice to
Landlord, such continuance of possession by Tenant will be deemed to be a
month-to-month tenancy at the sufferance of Landlord terminable on thirty (30)
day notice at any time by either party. All provisions of this Lease, except
those pertaining to term and rent, will apply to the month-to-month tenancy.
Tenant will pay a new Base Monthly Rent in an amount equal to 125% of the Base
Monthly Rent payable for the last full calendar month during the regular term of
this Lease (including any exercised option term(s)) for the first (1st) sixty
(60) days after the Lease Expiration Date, and 150% of the Base Monthly Rent
payable for the last full calendar month during the regular term of this Lease
(including any exercised option term(s)) thereafter.
30. DEFAULT OF LANDLORD/LIMITATION OF LIABILITY
30.01 Landlord Default; Tenant Set-Off Rights: In the event of any
default by Landlord hereunder, Tenant agrees to give notice of such default, by
registered mail, to Landlord at Landlord's Notice Address as stated in 1.04 and
to offer Landlord ten (10) business days to cure such default; provided,
however, that if the nature of Landlord's obligation is such that more than ten
(10) business days are required for performance, then Landlord will not be in
breach if Landlord commences performance within such ten (10) business day
period and thereafter diligently prosecutes the same to completion.
Notwithstanding any of the other provisions of this Lease, Tenant shall have the
right to set off up to a maximum cumulative amount during the term of this Lease
of Ten Thousand Dollars ($10,000) of Tenant's expenses incurred as a result of
the failure by Landlord to cure any default of Landlord in accordance with the
provisions of this Section 30.01. Prior to Tenant's performing on Landlord's
behalf the obligations hereunder and exercising Tenant's set-off rights, Tenant
shall provide Landlord with an additional ten (10) business day notice of the
exercise of such rights and, if Landlord objects in writing to such exercise
within the foregoing ten (10) business day period, the parties agree to submit
the issue to binding arbitration in Reno, Nevada, in accordance with the rules
of the American Arbitration Association then in effect. The costs of the
arbitration shall be borne equally by Landlord and Tenant. In the event Tenant
has provided Landlord with the required notices specified above, and Landlord
has not timely commenced actions and diligently prosecutes to cure the default
or notified Tenant of Landlord's objection or difference of opinion as to the
nature of Landlord's default within the time period specified above, then, and
only then, may Tenant perform such obligations on Landlord's behalf and at
Landlord's cost, and set off against the next payment(s) of rent due under this
Lease, up to a maximum cumulative amount of Ten Thousand Dollars ($10,000)
during the term of this Lease of such amount in accordance with the provisions
of this Section 30.01. Tenant shall provide Landlord with appropriate
substantiation of the costs incurred by Tenant and any work performed by Tenant
shall be performed by a licensed contractor subject to the requirements of
Section 10.01 above.
30.02 Limitation of Liability. In the event of any actual or alleged
failure, breach or default hereunder by Landlord, Tenant's sole and exclusive
remedy will be against Landlord's interest in the Project, and Landlord, its
directors, officers, employees and any partner of Landlord will not be sued, be
subject to service or process, or have a judgement obtained against him in
connection with any alleged breach
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or default, and no writ of execution will be levied against the assets of any
partner, shareholder or officer of Landlord. The covenants and agreements are
enforceable by Landlord and also by any partner, shareholder or officer of
Landlord.
31. SUBORDINATION
31.01 Without the necessity of any additional document being executed
by Tenant for the purpose of effecting a subordination, and at the election of
Landlord or any mortgagee with a lien on the Project or any ground lessor with
respect to the Project, this Lease will be subject and subordinate at all times
to (a) all ground leases or underlying leases which may now exist or hereafter
be executed affecting the Project, and (b) the lien of any mortgage or deed of
trust which may now exist or hereafter be executed in any amount for which the
Project, ground leases or underlying leases, or Landlord's interest or estate in
any of said items is specified as security. In the event that any ground lease
or underlying lease terminates for any reason or any mortgage or deed of trust
is foreclosed or a conveyance in lieu of foreclosure is made for any reason,
Tenant will, notwithstanding any subordination, attorn to and become the Tenant
of the successor in interest to Landlord, at the option of such successor in
interest, provided that such successor-in-interest agrees in writing to be bound
as Landlord under this Lease. Tenant covenants and agrees to execute and deliver
to Landlord any document or instrument reasonably requested by Landlord or its
ground lessor, mortgagee or beneficiary under a deed of trust evidencing such
subordination of this Lease with respect to any such ground lease or underlying
leases or the lien of any such mortgage or deed of trust. Tenant hereby
irrevocably appoints Landlord as attorney-in-fact of Tenant to execute, deliver
and record any such document in the name and on behalf of Tenant, in the event
Tenant has failed to execute and deliver such document or instrument within ten
(10) business days of Landlord's request to Tenant and provision of the
requested form of document or instrument to Tenant consistent with the terms of
Article 31.
32. DEPOSIT AGREEMENT
32.01 Landlord and Tenant hereby agree that Landlord will be entitled
to immediately endorse and cash Tenant's good faith rent and the Security
Deposit check(s) accompanying this Lease. It is further agreed and understood
that such action will not guarantee acceptance of this Lease by Landlord, but,
in the event Landlord does not accept this Lease, such deposits will be promptly
refunded in full to Tenant. This Lease will be effective only after Tenant has
received a copy fully executed by both Landlord and Tenant.
33. GOVERNING LAW
33.01 This Lease is governed by and construed in accordance with the
laws of the State of Nevada, and venue of any suit will be in the county where
the Premises are located unless the Premises are not located in Nevada in which
case the venue will be Washoe County in the State of Nevada.
34. NEGOTIATED TERMS
34.01 This Lease is the result of the negotiations of the parties and
has been agreed to by both Landlord and Tenant after prolonged discussion.
35. SEVERABILITY
35.01 If any provision of this Lease is found to be unenforceable, all
other provisions shall remain in full force and effect.
36. BROKERS
36.01 Tenant warrants that it has had no dealings with any broker or
agent in connection with this Lease, except Kit Xxxxxxxxx, XX Commercial, and
covenants to pay, hold harmless and indemnify Landlord from and against any and
all cost, expense or liability for any compensation, commissions and charges
claimed by any broker or agent, other than any identified above, with respect to
this Lease or its negotiation.
37. QUIET POSSESSION
37.01 Tenant, upon paying the rentals and other payments herein
required from Tenant, and upon Tenant's performance of all of the terms,
covenants and conditions of this Lease on its part to be kept and performed, may
quietly have, hold and enjoy the Premises during the Term of this Lease without
disturbance from Landlord or from any other person claiming through Landlord.
38. MISCELLANEOUS PROVISIONS
38.01 Whenever the singular number is used in this Lease and when
required by the context, the same will include the plural, and the masculine
gender will include the feminine and neuter genders, and the word "person" will
include corporation, firm, partnership, or association. If there is more than
one Tenant, the obligations imposed upon Tenant under this Lease will be joint
and several.
38.02 The headings or titles to paragraphs of this Lease are not a part
of this Lease and will have no effect upon the construction or interpretation of
any part of this Lease.
38.03 This instrument contains all of the agreements and conditions
made between the parties to this Lease. Tenant acknowledges that neither
Landlord nor Landlord's agents have made any representation or warranty as to
the suitability of the Premises to the conduct of Tenant's business. Any
agreements, warranties or representations not expressly contained herein will in
no way bind either Landlord or Tenant, and Landlord and Tenant expressly waive
all claims for damages by reason of any statement, representation, warranty,
promise or agreement, if any, not contained in this Lease.
38.04 Time is of the essence of each term and provision of this Lease.
38.05 Except as otherwise expressly stated, each payment required to be
made by Tenant is in addition to and not in substitution for other payments to
be made by Tenant.
38.06 Subject to Article 18, the terms and provisions of this Lease are
binding upon and inure to the benefit of the heirs, executors, administrators,
successors and assigns of Landlord and Tenant.
38.07 All covenants and agreements to be performed by Tenant under any
of the terms of this Lease will be performed by Tenant at Tenant's sole cost and
expense and without any abatement of rent (except as set forth in Section
30.01).
38.08 In consideration of the parties' respective covenants and
agreements hereunder, each party hereby covenants and agrees not to disclose any
terms, covenants or conditions of this Lease to any other party without the
prior written consent of the other party except (1) as otherwise represented in
the normal course of business for financing and in other business purposes, (2)
as required by law or court order, or (3) as required by either party's
independent auditors.
38.09 Tenant agrees it will provide to Landlord such financial
information as Landlord may reasonably request for the purpose of obtaining
construction and/or permanent financing for the Premises. Landlord agrees that
such financial information shall be subject to the Confidentiality Agreement in
the form attached hereto as Exhibit H.
38.10 If either party (the "Requesting Party") shall request the
consent of the other party (the "Non-requesting Party") and the Non-requesting
Party shall fail or refuse to give such consent, the Requesting Party shall not
be entitled to any damages for any withholding by the Non-requesting Party of
its consent; the Requesting Party's sole remedy shall be an action for specific
performance or injunction, and such remedy shall be available only in those
cases where the Non-requesting
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Party has expressly agreed in writing not to unreasonably withhold its consent
or where as a matter of law the Non-requesting Party may not unreasonably
withhold its consent.
38.11 Whenever a day is appointed herein on which, or a period of time
is appointed in which, either party is required to do or complete any act,
matter or thing, the time for the doing or completion thereof shall be extended
by a period of time equal to the number of days on or during which such party is
prevented from, or is reasonably interfered with, the doing or completion of
such act, matter or thing because of labor disputes, civil commotion, war,
warlike operation, sabotage, governmental regulations or control, fire or other
casualty, inability to obtain materials, or to obtain fuel or energy, weather or
other acts of God, or other causes beyond such party's reasonable control
(financial inability excepted); provided, however, that nothing contained herein
shall excuse Tenant from the prompt payment of any Rent or charge required of
Tenant hereunder.
38.12 No slot machine or other gambling game shall be permitted on the
Premises without the prior written consent of Landlord. The Premises shall not
be used for any "adult bookstore" or "adult motion picture theater" as said
terms are defined in NRS 278.0221, or any similar use, notwithstanding any local
zoning codes or ordinances or any other provisions of law to the contrary
permitting such use.
39. CHANGE ORDERS. In the event Tenant requests and\or approves changes in the
scope the work being provided by or through Landlord Tenant agrees to pay all
the direct and indirect costs of additional work at the time it gives such
approval. In the event that the aggregate cost of additional work provided under
this Lease is ten thousand dollars ($10,000.00) or more, or in excess of two
months rent, whichever is less, then Landlord may accept payment of one half of
the cost of additional work at the time of approval of said change order by the
Tenant, and payment of the balance to be paid at the time the additional work is
substantially completed.
40. SPECIAL PROVISIONS
40.01 Special provisions of this Lease number 41 through 44 and
Exhibits "A" (description of premises showing square footage), "B" ("Landlord's
Work" - tenant improvements), "C" (Tenant Questionnaire), "D" (Rules and
Regulations), "E" (Guaranty), "F" ("Commencement Date Certificate"), "G" ("Sign
Criteria"), and "H" ("Confidentiality Agreement"), are attached hereto and made
a part hereof.
41. OPTION TO EXTEND
41.01 Tenant is hereby granted one (1) option (the "Option") to extend
the Lease Term for an additional term of five (5) years (the "Extension"),
beginning on January 1, 2002, and expiring on December 31, 2006 (unless
terminated sooner pursuant to any other terms or provisions of the Lease), on
all of the same terms and conditions as set forth in the Lease, but at an
adjusted rent as set forth in Section 41.02 below (and without any additional
option to extend the Lease Term after the expiration of the Extension). The
Option may be exercised by Tenant only by delivery of written notice to
Landlord, which notice must be received by Landlord at least one hundred twenty
(120) days before the expiration of the original Lease Term set forth in Section
1.06 above. If Tenant fails to timely deliver such written notice, or if this
Lease is terminated pursuant to any other terms or provisions of this Lease
prior to the expiration of the original Lease Term, the Option shall lapse, and
Tenant shall have no right to extend the Lease Term. The Option shall be
exercisable by Tenant on the express conditions that (i) at the time of delivery
of Tenant's notice of its election to exercise the Option, and at all times
prior to the commencement of the Extension, Tenant shall not be in default under
this Lease, (ii) Tenant has not previously been in default (whether or not any
such default has been timely cured) under this Lease on more than three (3)
occasions during the Lease Term, and (iii) Tenant has not assigned this Lease
nor sublet all or any part of the Premises, it being understood that the Option
is personal to the original named Tenant under this Lease. In the event of any
such assignment or sublease, the Option shall lapse and shall be null and void
and of no further force or effect.
41.02 The rental during this Option period shall be at the "then
current market rate". In no event, however, shall the rental during the Option
period be less than the Base Rent due during the previous lease term.
42. FIRST RIGHT OF REFUSAL. At any time during the initial Lease term, Tenant
shall have the right of first refusal to lease the adjacent 35,560 square-foot
unit in the Premises. Should Landlord receive a bonafide offer from a third
party to lease this adjacent space, Landlord will notify Tenant, and Tenant
shall then have five (5) business days after receipt of notice from Landlord to
accept or reject the adjacent space on the same terms as Landlord's proposal
from a Third Party. If Tenant does not accept the same material terms and
provisions by written notice to Landlord within five (5) days of receipt of such
notice, then Landlord shall be free to enter into a lease with the Third Party.
In the event Tenant elects not to take the adjacent space at that time and
Landlord enters into a Lease with the Third Party for the adjacent space, Tenant
shall have a continuing option to expand into this space as follows. At any time
following the 18th month of the Third Party's lease, Tenant may provide Landlord
with not less than six (6) month's written notice of its intent to expand into
the adjacent space. Upon exercising this option, Tenant shall be responsible to
pay the costs of moving the Third Party tenant to another facility in the
Reno/Sparks, Nevada area. In no event, however, shall Tenant be liable to pay
more than $35,560.00 in moving costs to the Third Party tenant.
43. OPTION TO MOVE TO A LARGER FACILITY. After the 48th month of the initial
Lease Term, provided Tenant is not in default of this lease, Tenant shall have
the option to move to a larger facility owned by Landlord provided Tenant gives
Landlord a minimum of one hundred eighty (180) days prior written notice of its
desire to do so; that the larger space is a minimum of 35% larger than the space
covered in this Lease (i.e., a minimum of 135,875 square feet), and that
Landlord has such larger space available for lease. In the event Landlord does
not have such larger space available for lease, either in Tenant's existing
building or within Landlord's portfolio, Landlord and Tenant shall enter into a
build-to-suit contract for a new facility. Each of the above expansions shall
constitute a new five-year lease term on all of the Tenant's space at the then
current market rates. The present lease would automatically terminate upon
commencement of the new lease for the larger facility.
44. OPTION TO TERMINATE. In the event Landlord is unable to accommodate Tenant's
expansion space requirements pursuant to Article 43 herein, Tenant shall have
the option to terminate the lease. Upon exercising this option to terminate,
Tenant shall pay to Landlord a cancellation fee equal to two (2) month's base
monthly rent at their then current rate.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of
the day and year indicated by Landlord's execution date as written below.
Individuals signing on behalf of a Tenant warrant that they have the
authority to bind their principals. In the event that Tenant is a corporation,
Tenant shall deliver to Landlord, concurrently with the execution and delivery
of this Lease, a certified copy of corporate resolutions adopted by Tenant
authorizing said corporation to enter into and perform the Lease and authorizing
the execution and delivery of the Lease on behalf of the corporation by the
parties executing and delivering this Lease. THIS LEASE, WHETHER OR NOT EXECUTED
BY TENANT, IS SUBJECT TO ACCEPTANCE AND EXECUTION BY LANDLORD, ACTING ITSELF OR
BY ITS AGENT ACTING THROUGH ITS PRESIDENT, VICE PRESIDENT, OR ITS DIRECTOR OF
LEASING AND MARKETING.
Landlord: Xxxxxxx Properties, a Nevada corporation Tenant: MicroAge Logistics Services, Inc.
By: /s/ Xxxxxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxx
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Xxxxxxx X. Xxxxxxx Xxxx X. Xxxxx
Its: President Its: V.P. Administration
Date: 11/1/96 Date: 11/1/96
(Execution date) (Execution date)
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