SECOND LEASE AMENDMENT
Exhibit 10.9
SECOND
LEASE AMENDMENT
This SECOND LEASE AMENDMENT (this “Amendment”) is made
and entered into as of April 15, 2009 by and between SY
CORPORATION, a Nevada corporation, (“Landlord”) and
I-FLOW CORPORATION, a California corporation,
(“Tenant”).
Recitals
A. Tenant occupies approximately 66,675 square feet of
space within the building located at 20202 and 00000 Xxxxxxx
Xxxxx, Xxxx Xxxxxx, Xxxxxxxxxx (the “Building”)
pursuant to that certain Lease Agreement entered into as of
April 14, 1997 between Tenant and Industrial Developments
International, Inc., a Delaware corporation and predecessor in
interest to Industrial Property Fund L.L.P., as landlord,
with a lease term terminating on August 31, 2010, subject
to an option to renew vested in Tenant for an additional term of
five (5) years (the “Lease”). Capitalized terms
used but not otherwise defined herein shall have the meaning
given to such terms in the Lease.
B. Landlord acquired its interest in the above premises
through purchase of the real property from Industrial
Developments International Inc. and assignment of the Lease
Agreement under an Assignment of Lease dated October 6,
2004.
C. Landlord and Tenant now desire to amend the Lease
Agreement on the terms and conditions set out herein.
NOW, THEREFORE, in consideration of the foregoing recitals and
the mutual covenants contained herein, and for other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
Amendment
Terms
1. Additional Premises. As of
April 15, 2009, Landlord does hereby lease and demise to
Tenant an additional 20,000 square feet of space located
within the current Building, as described and depicted on
Exhibit ‘A’, attached hereto and incorporated herein
by reference, pursuant to all the terms and provisions of the
Lease, as hereby amended. The total square footage of the
Demised Premises will be 86,675 square feet of space.
Tenant acknowledges and agrees the above square footage figure
shall be used for determination of the additional rental amount
irrespective that the actual amount of square footage leased to
Tenant may differ slightly.
2. Expiration
Date. Section 1(h) of the Lease is
hereby deleted in its entirety and in place thereof, the
following is inserted: “Expiration Date: The Expiration
Date of the Lease shall be December 31, 2013.”
3. Renewal Option. Notwithstanding
Section 2 above Tenant shall retain the right granted under
Section 3.1(a) of the Lease to exercise its right to renew
for an additional five (5) year Renewal Term from and after
December 31, 2013, in accordance with the terms of
Section 3.1(a).
4. Right of First Refusal. If the
space between the Tenant’s Originally Demised Premises and
the Tenant’s Additional Premises becomes available at any
time during the lease term or any renewal thereof, the Landlord
shall offer any such space first to the Tenant to occupy. Once
offered by Landlord, the Tenant shall have sixty (60) days
to decide whether it wants such additional space offered.
5. Rental
Rate. Sections 1(d), 1(e) and 17(d) of
the Lease are hereby amended such that commencing April 15,
2009, the Annual Base Rent and corresponding Monthly Base Rent
shall increase each year on the anniversary date
1
of September 1, commencing in 2009, by three percent (3%),
except for the period beginning September 1, 2010 and
ending August 31, 2011, in which there will be no increase
to the Annual Base Rent, as follows:
|
Year
|
Annual Base Rent | Price per Sq. Ft. | ||||||
|
9-1-08 through 4-14-09
|
$ | 390,811.51 | $ | .90176 | ||||
|
4-15-09 through 8-31-09
|
$ | 429,880.26 | $ | .90176 | ||||
|
9-1-09 through 8-31-10
|
$ | 966,063.56 | $ | .9288 | ||||
|
9-1-10 through 8-31-11
|
$ | 966,063.56 | $ | .9288 | ||||
|
9-1-11 through 8-31-12
|
$ | 995,504.47 | $ | .9567 | ||||
|
9-1-12 through 8-31-13
|
$ | 1,024,905.83 | $ | .9854 | ||||
|
9-1-13 through
12-31-13
|
$ | 351,865.83 | $ | 1.0149 | ||||
6. Security
Deposit. Sections 1(k) and 5 of the
Lease remains the same.
7. Landlord Improvements. Prior to
April 15, 2009, Tenant shall relocate the existing fence
physically to segregate the Additional Premises from the
premises within the Building presently occupied by another
tenant (the “Adjacent Tenant”) along the column line
pursuant to Exhibit A. In addition, notwithstanding
anything to the contrary contained in the Original Lease, First
and Second Amendment. Tenant shall not be required to install
the new demising fence three and one-half (3.5) feet from the
industrial racks in the adjacent premises. Tenant shall also
have the right, at Tenant’s expense, to permanently remove
the existing racks on Tenant’s side of the new demising
fence location. Tenant shall store said removed racks inside of
Tenant’s Premises.
8. Operational and Utilities
Expenses. Operational and Utility Expenses
for the Additional Premises shall be prorated between Tenant and
the other tenant within the larger building on the basis of
their relative square feet and based upon the Adjacent
Tenant’s current utility usage. Such expenses shall be paid
by Tenant as set forth in the Lease Agreement.
9. Use of Racks. Tenant shall have
the right, without further consideration, during the Term of the
Lease to use for its own business purposes the industrial racks
presently located on the Additional Premises, provided however,
Tenant shall abide by any and all applicable codes and
regulations and shall not permit the racks or any other fixture
or equipment to come within three and a half feet (3.5’) of
the Chain Link Fence. Tenant shall use reasonable commercial
efforts to obtain a high-pile permit for use of the racks,
however, should Tenant be denied that permit but be allowed to
use the rack system under the permit issued to the Adjacent
Tenant, as contemplated by this Amendment, Tenant expressly
agrees to perform no act or to allow any condition to exist that
would jeopardize the high-pile permit issued to the Adjacent
Tenant.
10. Condition of Additional
Premises. Landlord shall deliver possession
of the Additional Premises to Tenant on April 15, 2009 and
in good operating condition and repair. Tenant shall notify
Landlord no later than May 15, 2009 of the need for repair
or replacement required with respect to the Additional Premises,
and Landlord shall timely make said repair or replacement at
Landlord’s expense, provided that Landlord shall not be
responsible for the repair or replacement of any damage caused
by Tenant.
11. Free Rent. Landlord herby
agrees to xxxxx two (2) month’s Base Rent, commencing
September 1, 2010 and continuing through October 31,
2010 (but not the triple net charges). In the event that Tenant
constructs the approximate 3,000 square feet of office
improvements outlined in Section 12 below. Landlord shall
xxxxx another one (1) month of rent. Said additional rent
abatement shall occur one (1) month after Tenant has
completed the below referenced office improvements and
Tenant has provided Landlord with “as built” drawings
of the same.
12. Office Construction and
Refurbishment. Tenant shall be allowed to add
up to 3,000 square feet of additional office space within
Tenant’s originally demised Premises. Tenant shall also be
allowed to refurbish the existing office space with new carpet
and paint. Such office construction and refurbishment shall be
at the sole cost and expense of Tenant and subject to the prior
written approval by the Landlord and the City of Lake Forest and
shall be in compliance with all other applicable terms and
conditions of the Lease. Tenant shall not have to remove or
modify any of the existing office space or additional office
space referenced in this Second Lease Amendment and the
expiration of the lease term.
2
13. Roof Repairs. Within six
(6) months after the execution of this Second Lease
Amendment, Landlord agrees to completely, and to the
satisfaction of the Tenant, repair, or completely replace, the
roof to avoid any leaking into the any of premises occupied by
the Tenant. In addition, commencing April 15, 2009,
Landlord shall be responsible for the repair and maintenance of
the roof, keeping it in a leak free condition, at
Landlord’s sole cost and expense.
14. Security System. Tenant before
occupation of the Additional Premises shall install at its sole
expense on the Additional Premises security monitoring alarm
system which shall be operational 24 hours per day
7 days per week.
15. Parking. Commencing
April 15, 2009, Tenant’s exclusive parking shall be
two-hundred eight (208) parking stalls. Tenant shall have
the right to designate Ten (10) of said spaces as reserved
near the Tenant’s main lobby entrance.
16. Brokerage Fee. Tenant shall be
responsible for paying Tenant’s broker. CB Xxxxxxx Xxxxx,
any brokerage fee.
17. Reaffirmation of Lease. Except
as expressly set forth in this Amendment, all of the terms and
provisions of the Lease shall remain unmodified and in full
force and effect.
18. Counterparts. This Amendment
may be executed in multiple counterparts, each of which shall be
deemed an original, but all of which will constitute one and the
same instrument.
LANDLORD:
SY CORPORATION, a Nevada Corporation
| By: |
/s/ Xxxx
Xxxxxx
|
Name: Xxxx Xxxxxx
Title: Manager
| Date: | 4-15-2009 |
TENANT:
I-FLOW CORPORATION, a Delaware corporation
| By: |
/s/ Xxxxx
X. Dal Porto
|
Name: Xxxxx X. Dal Porto
Title: Exec VP COO
| Date: | 4/15/09 |
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