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EXHIBIT 10.11
FIRST AMENDMENT TO AMENDED & RESTATED LEASE
THIS FIRST AMENDMENT TO AMENDED RESTATED LEASE ("Amendment") is made
between NORTHERN AUTOMOTIVE CORPORATION, an Arizona corporation, whose address
is 000 Xxxx Xxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx, 00000 ("Tenant"), and SPECTRUM
PROPERTIES INCORPORATED, an Oregon corporation ("Landlord") as successor to
MISSOURI FALLS ASSOCIATES LIMITED PARTNERSHIP, an Arizona limited partnership
("Missouri Falls"), whose address in 0000 Xxxxx 00xx Xxxxx, Xxxxxxx, Xxxxxxx,
00000, on November 22, 1991, effective as of the 1st day of January, 1991,
unless otherwise stated herein.
A. On March 14, 1987, Landlord and Tenant entered into a lease
agreement for certain office space (the "Leased Premises") located at 000 Xxxx
Xxxxxxxx Xxxxxx, Xxxxxxx, Arizona, which lease was amended by that certain
lease Amendment I executed October 29, 1987 and that certain Amendment II
executed October 28, 1987 (collectively, "Original Lease").
B. On October 23, 1989, Landlord and Tenant entered into an amended
and restated lease (the "Restated Lease") for the Leased Premises which
replaced and superseded the original Lease.
C. Following the withdrawal of Tenant as a partner of Missouri
Falls, the Restated Lease was effectively amended in the manner set forth in
Section 4 of that certain Agreement (the "1990 Agreement") executed by and
between Tenant and Missouri Falls and acknowledged and accepted by Landlord on
or about January 1990.
D. Landlord and Tenant now desire to make certain further
modifications to the Restated Lease.
AGREEMENTS:
NOW, THEREFORE, effective as of January 1, 1991, the parties hereto
covenant and agree as follows:
1. Tenant acknowledges and agrees that Tenant owes Landlord the sum
of Twenty-Six Thousand Seven Hundred Twenty-seven and 48/100 Dollars
($26,727,48) for Tenant's PRO RATA share of the cost of new carpeting and
painting recently completed In the common areas of the Leased Premises.
Landlord and Tenant acknowledge and agree with one another that a
true and correct recapitulation and reconciliation of all outstanding accounts
between them is set forth on Schedule "1" attached hereto and made a part
hereof. Such Schedule indicates that Tenant presently owes to Landlord the sum
of $11,046.83. The Schedule is true, accurate and correct through October 31,
1991. At the execution hereof, Tenant shall pay to Landlord the foregoing sum
and all sums then due
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and payable by Landlord or Tenant under the Lease (together with all applicable
credits) shall be deemed paid in full.
2. Any and all references in the Restated Lease to the Leased
Premises as described on Exhibits A, Al, A2 and A3 to the Restated Lease, which
exhibits are hereby deleted in their entirety, are hereby modified to refer to
the space described on the attached Exhibits Al, A2, A3 and A4 which are hereby
inserted in lieu thereof. Any and all references in the Restated Lease to the
Leased Premises shall hereinafter refer to the space described in Exhibits Al,
A2, A3 and A4 attached hereto and incorporated by reference herein and therein.
3. The Restated Lease is hereby amended by DELETING SUBSECTION A OF
SECTION 1 in its entirety and inserting the following in lieu thereof:
"A. "LEASED PREMISES" shall mean the area shown as such on
EXHIBITS Al, A2, A3 and A4 attached hereto and made a part
hereof. The Leased Premises shall consist of:
(a) The Improved Space (herein so called) which
shall contain no less than the following:
(i) 76,868 rentable square feet during
the period commencing January 1,
1991 and ending June 30, 1991; and
(ii) 78,577 rentable square feet during
the remaining term of the Lease; and
(b) The Unimproved Space (herein so called) which
shall contain 12,123 rentable square feet."
4. The Restated Lease is hereby amended by DELETING SUBSECTION D OF
SECTION 1 in its entirety and inserting the following in lieu thereof:
"D. "LEASE TERM" shall mean the period beginning on the Lease
Commencement Date (i.e., August 1, 1989) and ending on
July 31, 1998. Any reference in this Lease to "Lease
term" or the words "DURING THE TERM" or "THE TERM" shall
all be deemed to include any extension thereof authorized
under this Lease."
Further references in the Restated Lease which would indicated that the Lease
Term would extend from August 1, 1998 through July 31, 1999 ("Interim Period")
shall be deemed excised. Where such excisions are made, the remaining text
shall be deemed amended accordingly. In addition, references to rentals or
other charges due during the Interim Period shall be deemed excised and the
remainder of the text shall be deemed to be modified accordingly.
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5. The Restated Lease is hereby amended effective as of January 1,
1991 by DELETING SUBSECTION E OF SECTION 1 in its entirety and inserting the
following in lieu thereof:
"E. "BASE RENT" shall mean the following for the periods and
space indicated, subject to the provisions set forth in
Section 3(c) below:
ANNUAL BASE RENT
PER SQ. FT. OF
TENANT'S RENTABLE
MONTHLY BASE SQUARE FOOTAGE
RENT FOR THE OF THE IMPROVED
PERIOD IMPROVED SPACE SPACE
01/01/91 to 06/30/91 $ 97,622.36 $15.24
07/01/91 to 07/31/92 $ 99,792.79 $15.24
08/01/92 to 07/31/95 $114,722.42 $17.52
08/01/95 to 07/31/98 $124,151.66 $18.96
ANNUAL BASE RENT
PER SQ. FT. OF
TENANT'S RENTABLE
MONTHLY BASE SQUARE FOOTAGE
RENT FOR THE OF THE UNIMPROVED
PERIOD UNIMPROVED SPACE SPACE
01/01/91 to 12/31/91 $7,576.87 $7.50
01/01/92 to 12/31/92 $7,879.95 $7.80
01/01/93 to 12/31/93 $8,183.02 $8.10
01/01/94 to 12/31/94 $8,486.10 $8.40
01/01/95 to 12/31/95 $8,789.17 $8.70
01/01/96 to 12/31/96 $9,092.25 $9.00
01/01/97 to 12/31/97 $9,395.32 $9.30
01/01/98 to 07/31/98 $9,698.40 $9.60
6. The Restated Lease is hereby amended by DELETING THE FIRST
SENTENCE IN SUBSECTION F OF SECTION 1 and inserting the following in lieu
thereof:
F. "TENANT'S RENTABLE SQUARE FOOTAGE" shall mean an amount
equal to 110.7% of the usable square feet occupied and
leased by Tenant. The usable square feet occupied,
utilized and leased by Tenant in the Unimproved Space is
10,952 square feet and the usable square feet occupied,
utilized and leased by Tenant in the Improved Space
during the period commencing January 1, 1991
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and ending June 30, 1991, is 69,438 square feet and
thereafter 70,982 square feet as more thoroughly set
forth below:
PERIOD
01/01/90 TO DURING REMAINING
LOCATION 06/30/91 TERM OF LEASE
1st Floor 8,900 sq. ft 8,900 sq. ft
2nd Floor 10,562 sq. ft. 10,562 sq. ft.
3rd Floor 26,663 sq. ft. 26,663 sq. ft.
4th Floor 23,313 SQ. FT. 24,857 SQ. FT.
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69,438 sq. ft. 70,982 sq. ft.
Based on a 10.7% load factor, Tenant's Rentable Square Footage in
the Improved Space during the period commencing January 1, 1991 and
ending June 30, 1991 is 76,868 rentable square feet (69,438 usable
sq. ft x 1.107 = 76,868 rentable sq. ft.) and thereafter 78,577
rentable square feet (70,982 usable sq. ft. x 1.107 = 78,577
rentable sq. ft.). Based on a 10.7% load factor, Tenant's Rentable
Square Footage in the Unimproved Space is 12,123 rentable square
feet (10,952 usable sq. ft. x 1.107 = 12,123 rentable sq. ft.)."
The parties acknowledge that, at certain places, the Restated Lease refers to
"TENANT IS TOTAL SQUARE FOOTAGE." The parties further acknowledge that, as of
the Effective Date, when used therein, the term "TENANT'S TOTAL SQUARE FOOTAGE"
shall mean and refer to the calculation of Tenant's Rentable Square Footage set
forth above (i.e., Tenant's usable square footage plus its PRO RATA share of
the Common Areas).
7. The Restated Lease is hereby amended by DELETING SUBSECTION G OF
SECTION 1 in its entirety and substituting in lieu thereof the following:
"G. "PERMITTED PURPOSE" shall mean use of the Improved Space for
general office purposes and purposes incidental thereto, and the use
of the Unimproved Space for storage for Tenant's property as long as
it remains unimproved or for general office purposes and incidental
purposes in the event it is subsequently improved."
8. The Restated Lease is hereby amended by DELETING THE FIRST
SENTENCE IN SUBSECTION A OF SECTION 3 and inserting the following in lieu
thereof:
"Effective as of August 1, 1991, Tenant covenants and
agrees to pay to Landlord during the term of this Lease,
at the place specified by Landlord, the
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Base Rent , without deduction or setoff (unless expressly
authorized by this Lease), due and payable in advance on
the first day of each month. Tenant shall also pay all
sales or transaction privilege taxes due or coming due on
all sums payable by Tenant to Landlord hereunder, whether
such tax is levied upon Tenant or Landlord. Taxes shall
be paid at the same time as payments of Base Rent or
other sums due hereunder. All sums payable by Tenant
under this Lease shall be deemed rent."
9. The Restated Lease is hereby amended by ADDING THE FOLLOWING AT
THE END OF SUBSECTION A OF SECTION 3:
"Notwithstanding any provision herein to the contrary,
and provided that Tenant is not in default in the payment
of Rent, then, as set forth in the 1990 Agreement:
(i) The monthly payment of Base Rent
commencing on January 1, 1991 and
the next seventy-eight (78) monthly
payments thereafter shall each be
reduced by the sum of Nine Thousand
Three Hundred Seventy-five and
No/100 Dollars ($9,375.00) per
month; and
(ii) commencing on August 1, 1997, the
monthly payments of Base Rent shall
again be payable in full in
accordance with the schedule set
forth in Subsection E of section 1
above."
10. Effective as of August 1, 1991, the Restated Lease is hereby
amended by DELETING sales taxes from the definition of and as an item to be
included in "Building Operating Costs."
11. Effective as of August 1, 1991, the Restated Lease is hereby
amended by DELETING SUBSECTION C OF SECTION 3 in its entirety and inserting the
following in lieu thereof:
"C. During the period January 1, 1991 through June 30, 1991, Tenant
shall be liable for Tenant's PRO RATA share of Building Operating
Costs, which shall be $5.35 per square foot of Tenant's Rentable
Square Footage of 76,868. During the period July 1, 1991 through
December 31, 1991, Tenant shall be liable for Tenant's pro rata
share of Building Operating Costs, which shall be $2.85 per square
foot of Tenant's Rentable Square Footage of 78,577. Thereafter,
Tenant's liability for its pro rata share of Building Operating
Costs shall be increased annually by an amount equal to the actual
annual increase of the Building Operating Costs per square foot of
the total Building square footage for the calendar year in question
above the Building Operating Costs per square foot of the total
Building square footage for the 1991
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calendar year. For example, the limit placed on Tenant's liability
for its pro rata share of Building Operating Costs for the 1992
calendar year shall be an amount equal to the product of Tenant's
Rentable Square Footage times the sum of $2.85 PLUS the increase, on
a per square foot basis, of such Building Operating Costs in 1992 as
opposed to 1991. If in 1992 such Building Operating Costs rose $.30
per square foot of the total Building square footage above the
amount that such Building Operating Costs were in 1991, then the
limit placed on Tenant's liability for its pro rata share of
Building Operating Costs for the 1992 calendar year would be $3.15
($2.85 plus $.30) per square foot of Tenant's Rentable Square
Footage. If in 1993 Building Operating Costs rose $.60 per square
foot of the total Building square footage above the amount they were
in 1991, then the limit placed on Tenant's liability for its pro
rata share of Building Operating Costs for the 1993 calendar year
would be $3.45 ($2.85 plus $.60) per square foot of Tenant's
Rentable Square Footage. For purposes of computing Tenant's pro rata
share of Building Operating Costs, only Tenant's Rentable Square
Footage for the Improved Space shall be used in the calculation AS
LONG, AS BUT ONLY AS LONG AS the Unimproved Space remains
unimproved. In the event the Unimproved Space is subsequently
improved, then commencing with the month in which the construction
of any improvements in the Unimproved Space is commenced (i)
Tenant's Rentable Square Footage for BOTH the Improved Space and the
portion of the Unimproved Space theretofore improved shall be used
for purposes of computing Tenant's PRO RATA share of Building
Operating Costs; and (ii) the monthly Base Rent for the portion of
the Unimproved Space theretofore improved shall be increased and
shall instead be based on the higher annual Base Rent per square
foot of Tenant's Rentable Square Footage of the Improved Space and
shall no longer be based on the lower annual Base Rent per square
foot of Tenant's Rentable Square Footage of the Unimproved Space, as
set forth in Section l(E) above."
12. The Restated Lease is hereby amended by DELETING the third to
the last sentence in SUBSECTION B OF SECTION 6 and inserting the following in
lieu thereof:
"Landlord and Landlord's management agency and mortgagee, if any,
shall be named as additional insureds under such insurance and such
insurance shall be primary and noncontributing with any insurance
carried by Landlord."
13. The Restated Lease is hereby amended by DELETING SECTION 12(a)
in its entirety and inserting the following in lieu thereof:
"Except as provided in Section 12 (b) , Tenant may not sell,
transfer, assign, sublet, encumber, or hypothecate all or any part
of Tenant's interest in the Leased Premises, or its estate or
interest in this Lease (hereafter, an "Assignment"), without the
prior written consent of Landlord and any attempt so to do shall be
void and confer no right upon the purchaser, transferee, assignee,
sublessee or encumbrance holder. However, in no event shall Landlord
unreasonably withhold or delay its consent to any proposed
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Assignment of the Leased Premises if the proposed Assignment does
not relate to Unimproved Space (as to which Landlord may withhold
consent in its sole discretion). In the event Tenant wishes to
Assign its interest in the Leased Premises, it shall provide to
Landlord reasonable information regarding the proposed Assignee's
business and method of operation. Unless Tenant requests a release
from liability (which Landlord is not obligated to grant), Tenant
shall not be obligated to provide financial statements for such
proposed Assignee. In the event that Landlord does not respond
within ten (10) business days after receipt of all such reasonable
information, such proposed Assignee shall be deemed approved. In
addition, without the consent of Landlord, which consent may be
withheld in Landlord's sole, only and unfettered discretion, any
such Assignment shall not release Tenant from any of its obligations
under the Restated Lease, all of the same to remain in full force
and effect."
Section 12(b) of the Restated Lease shall remain unaffected.
14. The Restated Lease is hereby amended by DELETING SECTION 15 in
its entirety and inserting the following in lieu thereof:
"15. ADDITIONAL EXPANSION SPACE.
Tenant shall use the Unimproved Space solely for storage space by
Tenant and for no other purpose. Tenant acknowledges and agrees that
the Unimproved Space is leased by Tenant "as is," that Landlord has
no obligation to construct or to pay for the construction of any
improvements on the Unimproved Space and that if any improvements
are made to the Unimproved Space they shall be made at Tenant's sole
cost and expense. Notwithstanding any provision in this Lease to the
contrary, Landlord shall have the right at any time during the term
of this Lease to terminate Tenant's occupancy and lease of the
Unimproved Space, which at the time of termination remains
unimproved, by delivering thirty (30) day advance written notice
thereof to Tenant."
15. The Restated Lease is hereby amended by DELETING SECTION 16 in
its entirety and inserting the following in lieu thereof:
"16. [RESERVED]"
16. The Restated Lease is hereby amended by MODIFYING SECTION 18 to
reduce the covered parking spaces available to Tenant and its employees and
invitees to three hundred ten (310) instead of four hundred four (404).
17. The Restated Lease is hereby amended by DELETING SUBSECTION A OF
SECTION 27 which sets forth the original designated address for Landlord in its
entirety and inserting the following in lieu thereof:
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"A. If intended for Landlord:
Spectrum Properties Incorporated
c/o CBS Property Services, Inc.
000 Xxxx Xxxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000"
18. The Restated Lease is hereby amended by DELETING THE SECTION 40
in its entirety and inserting the following in lieu thereof:
Landlord hereby grants to Tenant two options ("Option") to extend
the term, each for a five-year period ("Option Term"). Except as
provided herein, each Option is granted on the same terms and
conditions provided for in the Lease, except for Rent and Lease
term. The Base Rent for the Option Terms shall be equal to 95% of
the then-current Fair Market Rental Value ("FMRV") as defined below
for each Option Term; provided, however, that the Base Rent for the
first Option Term shall be no less than $18.95 per square foot of
Tenant's Total Square Footage and no more than $24.00 per square
foot of Tenant's Total Square Footage and for the second Option
Term, shall be no less than $24.00 per square foot of Tenant's Total
Square Footage and no more than $28.00 per square foot of Tenant's
Total Square Footage.
Monthly Base Rent shall be calculated based on the space leased
pursuant to this First Amendment, and may be modified by additional
Unimproved Space being improved by Tenant pursuant to the terms
hereof.
Tenant must give notice of its intent to exercise each option
granted herein within 180 days prior to the expiration of the Lease
Term then in effect. The Options may not be exercised if Tenant is
then in default under this Lease.
FMRV as used in this Section shall be Base Rent calculated at the
then-prevailing rate for similar space by a tenant having a similar
credit rating in comparable buildings located within the Phoenix
metropolitan area. FMRV shall be declared by Landlord in writing to
Tenant not less than eight (8) months prior to the commencement of
any Option Term. Upon exercise of Tenant's option to extend as
herein provided, Tenant shall notify Landlord in writing of its
acceptance or rejection of such proposed Base Rent. If, within ten
(10) days of Tenant's registering its rejection of Landlord's
declaration, the parties have not agreed upon FMRV, it shall be
established by arbitration under the commercial arbitration rules of
the American Arbitration Association then in effect or by such other
method, if any, as the parties may then agree upon. The parties
agree to prevail upon the American Arbitration Association, or such
other party as may then be agreed upon, to select qualified real
estate brokers, appraisers or building managers to comprise the
three-person arbitration panel and
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further agree that the FMRV established by arbitration shall be
binding. In the event the results of the arbitration are not known
by the start of an Option Term, Tenant shall pay a rental equal to
the Base Rent, as adjusted in accordance with Section 3 of the
Lease, payable in the month immediately preceding the day upon which
the option Term starts (the "Interim Rent") from the day upon which
such Term starts until the time the FMRV has been established by the
arbitration panel. Such FMRV shall then be used to calculate the
Base Rent which would have been payable by Tenant during such Option
Term and ending on the date the FMRV is established by arbitration,
had FMRV been changed commencing on the date the Option Term began.
If the Base Rent based on the FMRV is greater than the Interim Rent,
Tenant shall pay the difference, in lump sum, on the first day of
the month following the determination of FMRV or in the event that
FMRV is less than the Interim Rent, Landlord shall issue a credit
for the difference against Base Rent otherwise payable on the first
day of the month following the termination of FMRV.
19. The Restated Lease is hereby amended by DELETING SECTION 41 in
its entirety.
20. Tenant hereby acknowledges that as of the date this Amendment is
executed by Tenant and Landlord, November 22, 1991, the Restated Lease is in
full force and effect, Landlord is not in known default under the Restated
Lease, and Tenant does not have any defense to payment of rent, charge, lien or
claim of set off or any other claim against Landlord under or with respect to
the Restated Lease or against the rents payable thereunder. Similarly, Landlord
acknowledges that as of the date this Amendment is executed by Landlord, the
Restated Lease is in full force and effect and Tenant is not in known default
under the Restated Lease. Effective as of the date this Amendment is executed
by Tenant, Tenant does release, acquit and forever discharge Landlord and
Landlord's subsidiaries, affiliates, officers, directors, agents, employees,
respective heirs, personal representatives, successors, and assigns
(hereinafter collectively referred to as the "Released Parties") from any and
all claims, demands, debts, actions, causes of action, suits, contracts,
agreements, obligations, accounts, defenses, and liabilities of any kind and
character whatsoever, known or unknown, suspected or unsuspected, in contract
or in tort, at or in equity, including without limitation, such claims and
defenses as frauds, mistake and duress, which Tenant may ever have had, now
have, or might hereafter have against the Released Parties, jointly or
severally, for or by reason of any matter, cause, or thing whatsoever occurring
before the date this Amendment was executed by Tenant. Tenant acknowledges and
agrees that this release is not limited to claims which are known or disclosed
and further agrees, represents and warrants that the releases and waivers
described in this Section are unconditional, enforceable and irrevocable and
shall survive termination of the Restated Lease. However, in no event shall the
foregoing release extend to unknown causes of action which Tenant may have or
claim to have as respects or arises out of the condition of the Building or of
the construction or condition of the Leased Premises, to the extent that Tenant
may have the same or claim to have the same at any time in the future. Tenant
represents and warrants to Landlord that it knows no claims which it has at
this time relating to the Building or the Premises which are a part thereof.
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Landlord does hereby release, acquit and forever discharge Tenant
and Tenant's subsidiaries, affiliates, officers, directors, agents, employees,
respective heirs, personal representatives, successors, and assigns
(hereinafter collectively referred to as the "Tenant Released Parties") from
any and all known claims, demands, debts, actions, causes of action, suits,
contracts, agreements, obligations, accounts, defenses, and liabilities of any
kind and character whatsoever, in contract or in tort, at or in equity,
including without limitation, such claims and defenses as frauds, mistake and
duress, which Landlord may ever have had or now has against the Tenant Released
Parties, jointly or severally, for or by reason of any matter, cause, or thing
relating to or arising out of the Amended & Restated Lease and the Leased
Premises occurring before the date this Amendment was executed by Landlord.
21. Except as herein amended, the provisions of the Amended &
Restated Lease shall remain in full force and effect in accordance with the
provisions thereof.
22. This Amendment shall be binding upon and inure to the benefit of
the heirs, successors, personal representatives and assigns of the respective
parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment
effective as of the day and year first above written.
"TENANT"
NORTHERN AUTOMOTIVE CORPORATION,
AN ARIZONA CORPORATION
Dated By
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Its
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"LANDLORD"
SPECTRUM PROPERTIES INCORPORATED,
AN OREGON CORPORATION
Dated By
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Its
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