HAVEN GATEWAY CENTRE
INDUSTRIAL LEASE
BETWEEN
HAVEN GATEWAY LLC,
A DELAWARE LIMITED LIABILITY COMPANY
AND
OAKLEY, INC.,
A WASHINGTON CORPORATION
AS TENANT
TABLE OF CONTENTS
-----------------
SECTION 1: DEFINITIONS .............................................................. 1
1.1 Definitions ........................................................... 1
1.2 Access Laws ........................................................... 1
1.3 Additional Rent ....................................................... 1
1.4 Intentionally Omitted ................................................. 1
1.5 Base Rent ............................................................. 1
1.6 Brokers ............................................................... 2
1.7 Building .............................................................. 2
1.8 Business Day .......................................................... 2
1.9 Claims ................................................................ 2
1.10 Commencement Date ..................................................... 2
1.11 Estimated Operating Costs Allocable to the Premises ................... 2
1.12 Events of Default ..................................................... 2
1.13 Excess Allowance ...................................................... 2
1.14 Governmental Agency ................................................... 2
1.15. Governmental Requirements ............................................. 2
1.16 Hazardous Substance(s) ................................................ 2
1.17 Land .................................................................. 2
1.18 Landlord .............................................................. 2
1.19 Landlord's Agents ..................................................... 2
1.20 Lease Term ............................................................ 2
1.21 Manager ............................................................... 2
1.22 Manager's Address ..................................................... 2
1.23 Operating Costs ....................................................... 2
1.24 Operating Costs Allocable to the Premises ............................. 2
1.25 Parking Rights ........................................................ 2
1.26 Permitted Use ......................................................... 3
1.27 Intentionally Omitted ................................................. 3
1.28 Prepaid Rent .......................................................... 3
1.29 Premises .............................................................. 3
1.30 Prime Rate ............................................................ 3
1.31 Project ............................................................... 3
1.32 Property Taxes ........................................................ 3
1.33 Security Deposit ...................................................... 3
1.34 Tenant ................................................................ 3
1.35 Tenant Alterations .................................................... 3
1.36 Tenant Improvement Allowance .......................................... 3
1.37 Tenant Improvements ................................................... 3
1.38 Tenant's Agents ....................................................... 4
1.39 Tenant's Pro Rata Share ............................................... 4
1.40 Year .................................................................. 4
SECTION 2: PREMISES AND TERM ........................................................ 4
2.1 Lease of Premises ..................................................... 4
2.2 Lease Term ............................................................ 4
2.3 Tenant Improvements ................................................... 4
2.4 Tenant's Contribution to Tenant Improvement Costs ..................... 4
2.5 Condition of Premises "AS-IS" ......................................... 4
2.6 Memorandum of Commencement Date ....................................... 4
2.7 Use and Conduct of Business ........................................... 4
2.8 Compliance with Governmental Requirements and Rules and Regulations ... 5
SECTION 3: BASE RENT, ADDITIONAL RENT AND OTHER SUMS PAYABLE UNDER LEASE. ........... 5
3.1 Payment of Rental ..................................................... 5
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3.2 Base Rent ............................................................. 5
3.3 Security Deposit ...................................................... 5
3.4 Additional Rent ....................................................... 6
3.4.1 Rental Adjustment for Estimated Operating Costs ................ 6
3.4.2 Actual Costs ................................................... 6
3.4.3 Determination of Operating Costs ............................... 7
3.4.4 End of Term .................................................... 7
3.4.5 Definitions .................................................... 7
3.4.6 Janitorial Services ............................................ 9
3.4.7 Additional Rent ................................................ 9
3.4.8 Operating Cost Audit ........................................... 9
3.5 Utilities ............................................................. 10
3.6 Holdover .............................................................. 10
3.7 Late Charge .......................................................... 10
3.8 Default Rate .......................................................... 11
SECTION 4: GENERAL PROVISIONS ....................................................... 11
4.1 Maintenance and Repair by Landlord .................................... 11
4.2 Maintenance and Repair by Tenant ...................................... 11
4.3 Common Areas/Security ................................................. 12
4.4 Tenant Alterations .................................................... 13
4.5 Tenant's Work Performance ............................................. 13
4.6 Surrender of Possession ............................................... 14
4.7 Removal of Property ................................................... 14
4.8 Access ................................................................ 15
4.9 Damage or Destruction ................................................. 15
4.9.1 Restoration of Premises ........................................ 15
4.9.2 Damage in Excess of Fifty Percent .............................. 16
4.9.3 Termination of Lease by Mortgage Holder's Election ............. 16
4.9.4 Destruction Near End of Term ................................... 16
4.9.5 Waiver ......................................................... 16
4.9.6 Termination by Tenant .......................................... 16
4.10 Condemnation .......................................................... 16
4.11 Parking ............................................................... 17
4.12 Indemnification ....................................................... 17
4.13 Tenant Insurance ...................................................... 17
4.13.1 Form of Policies ............................................... 17
4.13.2 Approval of Insurer ............................................ 18
4.13.3 Landlord Obtained Insurance .................................... 18
4.14 Landlord's Insurance .................................................. 18
4.15 Waiver of Subrogation ................................................. 18
4.16 Assignment and Subletting by Tenant ................................... 18
4.16.1 Restrictions on Transfer ....................................... 18
4.16.2 Landlord Consent, Procedure .................................... 19
4.16.3 Landlord Consent, Relevant Factors ............................. 19
4.16.4 Notice Regarding Landlord's Consent ............................ 20
4.16.5 Restriction of Transfer of Interests in Tenant ................. 20
4.16.6 Excess Rent .................................................... 20
4.16.7 Recapture ...................................................... 20
4.17 Assignment by Landlord ................................................ 21
4.18 Estoppel Certificates and Financial Statements ........................ 21
4.19 Modification for Lender ............................................... 21
4.20 Hazardous Substances .................................................. 21
4.21 Access Laws ........................................................... 22
4.21.1 Notice to Landlord of Violation ................................ 22
4.21.2 Prohibited Acts ................................................ 22
4.21.3 Tenant Responsibility .......................................... 22
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4.21.4 Landlord Responsibility ........................................ 22
4.21.5 Indemnity of Landlord .......................................... 23
4.21.6 Inconsistent Provisions of Law .......................... 23
4.22 Quiet Enjoyment ........................................................ 23
4.23 Signs .................................................................. 23
4.24 Subordination .......................................................... 23
4.25 Workers Compensation Immunity .......................................... 24
4.26 Brokers ................................................................ 24
4.27 Exculpation and Limitation of Liability ................................ 24
4.28 Intentionally Omitted .................................................. 24
4.29 Mechanic's Liens and Tenant's Personal Property Taxes .................. 24
4.29.1 Mechanic's Liens ............................................... 24
4.29.2 Personal Property Taxes ........................................ 25
4.30 Landlord's Security Interest ........................................... 25
SECTION 5: DEFAULT AND REMEDIES ..................................................... 25
5.1 Events of Default ..................................................... 25
5.1.1 Events of Default .............................................. 25
5.1.2 Notice of Default .............................................. 26
5.1.3 Notice to Landlord Regarding Tenant Default .................... 26
5.1.4 Treatment as Unexpired Lease ................................... 26
5.2 Remedies .............................................................. 26
5.2.1 Remedies; Termination and Recovery of Possession ............... 26
5.2.2 Remedies; Recover Rent as it Becomes Due ....................... 27
5.2.3 Succession to Tenant Rights .................................... 27
5.2.4 Rights and Remedies Cumulative ................................. 27
5.2.5 Money Damages Upon Reletting ................................... 27
5.2.6 Remedies Nonexclusive .......................................... 28
5.3 Right to Perform ...................................................... 28
5.4 Landlord's Default .................................................... 28
5.5 Acceptance of Rent Without Waiving Rights ............................. 28
SECTION 6: MISCELLANEOUS PROVISIONS ................................................. 28
6.1 Notices ............................................................... 28
6.2 Attorney's Fees and Expenses .......................................... 29
6.3 No Accord and Satisfaction ............................................ 29
6.4 Successors; Joint and Several Liability ............................... 29
6.5 Choice of Law ......................................................... 29
6.6 No Waiver of Remedies ................................................. 29
6.7 Offer to Lease ........................................................ 29
6.8 Force Majeure ......................................................... 30
6.9 Landlord's Consent .................................................... 30
6.10 Severability; Captions ................................................ 30
6.11 Interpretation ........................................................ 30
6.12 Incorporation of Prior Agreement; Amendments .......................... 30
6.13 Authority ............................................................. 30
6.14 Time of Essence ....................................................... 30
6.15 Survival of Obligations ............................................... 30
6.16 Consent to Service .................................................... 30
6.17 Landlord's Authorized Agents .......................................... 30
6.18 Edison License ........................................................ 31
6.19 Waiver of Jury Trial .................................................. 31
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LISTING OF EXHIBITS
Exhibit A Legal Description of the Land
Exhibit B Drawing Showing Location of the Premises
Exhibit C Work Letter and Construction Agreement
Exhibit D Form of Memorandum of Commencement Date
Exhibit E Rules and Regulations
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HAVEN GATEWAY CENTRE INDUSTRIAL LEASE
THIS HAVEN GATEWAY CENTRE INDUSTRIAL LEASE (this "Lease") is made as of November
10, 2000, by and between
"LANDLORD" HAVEN GATEWAY LLC, a Delaware limited liability company
and
"TENANT" OAKLEY, INC., a Washington corporation
SECTION 1: DEFINITIONS
1.1 DEFINITIONS: Each underlined term in this section shall have the
meaning set forth next to that underlined term.
1.2 ACCESS LAWS: The Americans With Disabilities Act of 1990 (including the
Americans with Disabilities Act Accessibility Guidelines for Building
and Facilities) and all other Governmental Requirements relating to the
foregoing.
1.3 ADDITIONAL RENT: Defined in paragraph captioned "ADDITIONAL RENT".
1.4 INTENTIONALLY OMITTED.
1.5 BASE RENT: Base Rent shall be as follows:
Monthly Base Rent:
Lease Months Monthly Base Rent
------------ -----------------
1-30 $38,016.00
31-60 $40,936.14
Annual Base Rent:
Lease Months Annual Base Rent
------------ ----------------
1-30 $456,192.00
31-60 $491,233.68
1.6 BROKERS: Tenant was represented in this transaction by Xxxxxx Xxxxxx
Associates, a licensed real estate broker. Landlord was represented in
this transaction by Investment Development Services and Xxxxxxx and
Wakefield, licensed real estate brokers.
1.7 BUILDING: A free standing industrial building located on the Land,
commonly known as 0000 X. Xxxxxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxx.
Landlord and Tenant stipulate that the Building contains 118,800
rentable square feet. Such square footage shall be binding and
conclusive on Tenant for all purposes under this Lease.
1.8 BUSINESS DAY: Calendar days, except for Saturdays and Sundays and
holidays when banks are closed in Washington, D.C.
1.9 CLAIMS: An individual and collective reference to any and all claims,
demands, damages, injuries, losses, liens, liabilities, penalties,
fines, lawsuits, actions, other proceedings and expenses (including
attorney's fees and expenses incurred in connection with the proceeding
whether at trial or on appeal).
1.10 COMMENCEMENT DATE: The earlier of (a) the date Tenant first commences
to conduct business in the Premises, or (b) January 1, 2001.
1.11 ESTIMATED OPERATING COSTS ALLOCABLE TO THE PREMISES: Defined in
paragraph captioned "ADDITIONAL RENT".
1.12 EVENTS OF DEFAULT: One or more of those events or states of facts
defined in the paragraph captioned "EVENTS OF DEFAULT".
1.13 EXCESS ALLOWANCE: Defined in the Work Letter attached hereto as Exhibit
"C".
1.14 GOVERNMENTAL AGENCY: The United States of America, the state in which
the Land is located, any county, city, district, municipality or other
governmental subdivision, court or agency or quasi-governmental agency
having jurisdiction over the Land and any board, agency or authority
associated with any such governmental entity, including the fire
department having jurisdiction over the Land.
1.15 GOVERNMENTAL REQUIREMENTS: Any and all statutes, ordinances, codes,
laws, rules, regulations, orders and directives of any Governmental
Agency as now or later amended.
1.16 HAZARDOUS SUBSTANCE(S): Asbestos, PCBs, petroleum or petroleum-based
chemicals or substances, urea formaldehyde or any chemical, material,
element, compound, solution, mixture, sub-stance or other matter of any
kind whatsoever which is now or later defined, classified, listed,
designated or regulated as hazardous, toxic or radioactive by any
Governmental Agency.
1.17 LAND: The land upon which the Building is located in County of San
Bernadino, City of Ontario, State of California, as legally described
in EXHIBIT A attached to this Lease.
1.18 LANDLORD: The limited liability company named on the first page of this
Lease, or its successors and assigns as provided in paragraph captioned
"ASSIGNMENT BY LANDLORD".
1.19 LANDLORD'S AGENTS: Any and all partners, affiliates, officers, agents,
employees, trustees, members, investment advisors and consultants of
Landlord.
1.20 LEASE TERM: Commencing on the Commencement Date, and ending sixty (60)
months later, provided that, if the Commencement Date is a date other
than the first day of a calendar month, the Lease Term shall be
extended by the number of days remaining in the month in which the
Commencement Date occurs.
1.21 MANAGER: Investment Development Services, Inc., or its replacement, as
specified by written notice from Landlord to Tenant.
1.22 MANAGER'S ADDRESS: 000 Xxxx Xxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxxxxx,
Xxxxxxxxxx 00000, which address may be changed by written notice from
Landlord to Tenant.
1.23 OPERATING COSTS: Defined in paragraph captioned "ADDITIONAL RENT".
1.24 OPERATING COSTS ALLOCABLE TO THE PREMISES: Defined in paragraph
captioned "ADDITIONAL RENT".
1.25 PARKING RIGHTS: As of the Commencement Date, Tenant shall be permitted
to use one hundred thirty-seven (137) parking spaces at the Project on
a non-exclusive basis. Tenant is aware and agrees that the final number
of parking spaces may change if required by any Governmental Authority.
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1.26 PERMITTED USE: Warehousing and distribution of apparel, footwear and
related accessories, so long as such use is consistent with (i) the
applicable zoning for the Project, (ii) first-class industrial
multi-tenant buildings of the same or similar use as the Building and
located in the metropolitan area in which the Building is located, and
(iii) Governmental Requirements.
1.27 INTENTIONALLY OMITTED.
1.28 PREPAID RENT: $38,016.00, to be applied toward Base Rent and Additional
Rent for the first full calendar month of the Lease Term or to the
first calendar month in which full Base Rent and Additional Rent is
due.
1.29 PREMISES: The Premises consist of the entire Building. Landlord and
Tenant hereby stipulate that the Premises consist of 118,800 rentable
square feet. Such square footage shall be binding and conclusive on
Tenant for all purposes under this Lease. Landlord and Tenant
acknowledge and agree that the term "Premises" is used interchangeably
with the term "Building" throughout this Lease.
1.30 PRIME RATE: Defined in paragraph captioned "Default Rate".
1.31 PROJECT: The Haven Gateway Centre within which the Building and Land
are located, which Project shall consist of approximately 73.64 acres
and, when completed, estimated to be approximately 1,526,242 rentable
square feet, as the same may be adjusted by Landlord from time to time.
If the amount of rentable square feet of the Project is adjusted, then
Tenant's Pro Rata Share of the Project shall be equitably adjusted by
Landlord accordingly.
1.32 PROPERTY TAXES: (1) Any form of ad valorem real or personal property
tax or assessment imposed by any Governmental Agency on the Land,
Building, related improvements or any personal property owned by
Landlord associated with the Building or Land; (2) any other form of
tax or assessment, license fee, license tax, tax or excise on rent or
any other levy, charge, expense or imposition made or required by any
Governmental Agency on any interest of Landlord in the Building, Land,
related improvements or personal property; (3) any fee for services
charged by any Governmental Agency for any services such as fire
protection, street, sidewalk and road maintenance, refuse collection,
school systems or other services provided or formerly provided to
property owners and residents within the general area of the Land; (4)
any governmental impositions allocable to or measured by the area of
any or all of the Building, Land, related improvements or personal
property, or the amount of any base rent, additional rent or other sums
payable under any lease for any or all of the Building, Land, related
improvements or personal property, including any tax on gross receipts
or any excise tax or other charges levied by any Governmental Agency
with respect to the possession, leasing, operation, maintenance,
alteration, repair, use or occupancy of any or all of the Land or
Building, related improvements or personal property or the rent earned
by any part of or interest in the Building or Land, related
improvements or personal property; (5) any impositions by any
Governmental Agency on any transaction evidenced by a lease of any or
all of the Building or Land, related improvements or personal property
or charge with respect to any document to which Landlord is a party
creating or transferring an interest or an estate in any or all of the
Building or Land, related improvements or personal property; and (6)
any increase in any of the foregoing based upon construction of
improvements or change of ownership of any or all of the Land, related
improvements or personal property. Property Taxes shall not include
taxes on Landlord's net income or any inheritance, estate or gift
taxes.
1.33 SECURITY DEPOSIT: Thirty Eight Thousand Sixteen and 00/100 Dollars
($38,016.00).
1.34 TENANT: The person or entity(ies) named on the first page of this
Lease.
1.35 TENANT ALTERATIONS: Defined in paragraph captioned "TENANT
ALTERATIONS".
1.36 TENANT IMPROVEMENT ALLOWANCE: The maximum amount (subject to the Excess
Allowance) to be expended by Landlord, if any, for the cost of Tenant
Improvements (including architectural, engineering, permitting and
space planning fees), which maximum shall not exceed Two Hundred Seven
Thousand Nine Hundred and 00/100 Dollars ($207,900.00).
1.37 TENANT IMPROVEMENTS: Those alterations or improvements to the Premises
in the Premises which are in accordance with and subject to the terms
and conditions of the Work Letter Agreement attached hereto as EXHIBIT
C.
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1.38 TENANT'S AGENTS: Any and all officers, partners, contractors,
subcontractors, consultants, licensees, agents, concessionaires,
subtenants, servants, employees, customers, guests, invitees or
visitors of Tenant.
1.39 TENANT'S PRO RATA SHARE: One Hundred Percent (100%) of Operating Costs
for the Building and Seven and 79/100 Percent (7.79%) of Operating
Costs for the Project.
1.40 YEAR: A calendar year commencing January 1 and ending December 31.
SECTION 2: PREMISES AND TERM
2.1 LEASE OF PREMISES. Landlord leases the Premises to Tenant, and Tenant
leases the Premises from Landlord, upon the terms and conditions set
forth in this Lease.
2.2 LEASE TERM. The Lease Term shall be for the period stated in the
definition of that term, unless earlier terminated as provided in this
Lease.
2.3 TENANT IMPROVEMENTS. Tenant shall construct the Tenant Improvements
pursuant to the Work Letter attached as EXHIBIT C.
2.4 TENANT'S CONTRIBUTION TO TENANT IMPROVEMENT COSTS. If the cost of the
Tenant Improvements exceeds the Tenant Improvement Allowance and Excess
Allowance, if any is utilized by Tenant, then Tenant shall pay for such
excess at its sole cost and expense, and Landlord shall have no
responsibility whatsoever in connection with the same. All Tenant
Improvements, regardless of which party constructed them, shall become
the property of Landlord and shall remain upon and be surrendered with
the Premises upon the expiration or earlier termination of this Lease;
PROVIDED THAT, at Landlord's election and upon notice to Tenant, Tenant
shall be required to remove all or any portion of the Tenant
Improvements upon the expiration or earlier termination of this Lease;
provided however, that Tenant shall not be required to remove the
initial Tenant Improvements set forth on Exhibit "F" attached hereto,
provided the same are Project standard, as reasonably determined by
Landlord.
2.5 CONDITION OF PREMISES "AS-IS". Tenant hereby agrees that the Premises
shall be taken "as is", "with all faults", without any representations
or warranties, and Tenant hereby agrees and warrants that it has
investigated and inspected the condition of the Premises and the
suitability of same for Tenant's purposes, and Tenant does hereby waive
and disclaim any objection to, cause of action based upon, or claim
that its obligations hereunder should be reduced or limited because of
the condition of the Premises or the suitability of same for Tenant's
purposes. Tenant acknowledges that neither Landlord nor any agent nor
any employee of Landlord has made any representations or warranty with
respect to the Premises or Project or with respect to the suitability
of either for the conduct of Tenant's business, and Tenant expressly
warrants and represents that Tenant has relied solely on its own
investigation and inspection of the Premises and the Project in its
decision to enter into this Lease and let the Premises in an "as is"
condition. Landlord shall assign to Tenant, on a non-exclusive basis,
to the extent assignable, all warranties and guaranties provided to
Landlord with respect to any major equipment and materials furnished
exclusively to the Premises, and Landlord shall use commercially
reasonable efforts to assist Tenant, at no cost or expense to Landlord,
with Tenant's enforcement of any warranties or guaranties that have
been so assigned to Tenant. The taking of possession of the Premises by
Tenant shall conclusively establish that the Premises and the Project
were at such time in satisfactory condition.
2.6 MEMORANDUM OF COMMENCEMENT DATE. At Landlord's election and request,
Tenant shall execute a Memorandum of Commencement Date in the form
attached as EXHIBIT D. In no event shall Tenant record this Lease or
the Memorandum of Commencement Date.
2.7 USE AND CONDUCT OF BUSINESS. The Premises are to be used only for the
Permitted Uses, and for no other business or purpose without the prior
consent of Landlord. Landlord makes no representation or warranty as to
the suitability of the Premises for Tenant's intended use. Tenant
shall, at its own cost and expense, obtain and maintain any and all
licenses, permits, and approvals necessary or appropriate for its use,
occupation and operation of the Premises. Tenant's inability to obtain
or maintain any such license, permit or approval necessary or
appropriate for its use, occupation or operation of the Premises shall
not relieve it of its obligations under this Lease,
4
including the obligation to pay Base Rent and Additional Rent. No act
shall be done in or about the Premises that is unlawful or that will
increase the existing rate of insurance on any or all of the Land or
Building. Tenant shall not commit or allow to be committed or exist:
(a) any waste upon the Premises, (b) any public or private nuisance, or
(c) any act or condition which may disturb the quiet enjoyment of any
other tenant in the Project, violate any of Landlord's contracts
affecting any or all of the Land or Building or Project, create or
contribute to any work stoppage, strike, picketing, labor disruption or
dispute, interfere in any way with the business of Landlord or any
other tenant in the Project or with the rights or privileges of any
contractors, subcontractors, licensees, agents, concessionaires,
subtenants, servants, employees, customers, guests, invitees or
visitors or any other persons lawfully in and upon the Land or Project,
or causes any impairment or reduction of the good will or reputation of
the Land or Project. Tenant shall not, without the prior consent of
Landlord, which shall not be unreasonably withheld, use any apparatus,
machinery, device or equipment in or about the Premises which will
cause any substantial noise or vibration or any increase in the normal
consumption level of electric power. If any of Tenant's apparatus,
machinery, equipment or devices should disturb the quiet enjoyment of
any other tenant in the Project, then Tenant shall provide, at its sole
cost and expense, adequate insulation or take other such action,
including removing such apparatus, machinery, equipment or devices, as
may be necessary to eliminate the disturbance.
2.8 COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS AND RULES AND REQUISITIONS.
Tenant shall comply with all Governmental Requirements relating to the
Premises (including, without limitation, Tenant's use, occupancy and
operation thereof) and all other covenants, conditions and restrictions
and other matters of record, and Tenant shall observe such reasonable
rules and regulations as may be adopted and published by Landlord from
time to time for the safety, care and cleanliness of the Building, and
for the preservation of good order in the Building, including the Rules
and Regulations attached to this Lease as EXHIBIT E.
SECTION 3: BASE RENT, ADDITIONAL RENT AND OTHER SUMS PAYABLE UNDER LEASE
3.1 PAYMENT OF RENTAL. Tenant agrees to pay Base Rent, Additional Rent and
any other sum due under this Lease to Landlord without demand,
deduction, credit, adjustment or offset of any kind or nature, in
lawful money of the United States when due under this Lease, at the
offices of Manager at Manager's Address, or to such other party or at
such other place as Landlord may from time to time designate in
writing.
3.2 BASE RENT. On execution of this Lease, Tenant shall pay to Landlord the
amount specified in the definition of Prepaid Rent for the month
specified in the definition of that term. Tenant agrees to pay Base
Rent to Landlord without demand, in advance on or before the first day
of each calendar month of the Lease Term. Base Rent for any partial
month at the beginning or end of the Lease Term shall be prorated. Base
Rent for any partial month at the beginning of the Lease Term shall be
paid by Tenant on the Commencement Date.
3.3 SECURITY DEPOSIT. On execution of this Lease, Tenant shall pay to
Landlord the sum specified in the definition of the term Security
Deposit, as security for the full and faithful payment of all sums due
under this Lease and the full and faithful performance of every
covenant and condition of this Lease to be performed by Tenant. If
Tenant shall breach or default with respect to any payment obligation
or other covenant or condition of this Lease, Landlord may apply all or
any part of the Security Deposit to the payment of any sum in default
or any damage suffered by Landlord as a result of such breach or
default, and in such event, Tenant shall, upon demand by Landlord,
deposit with Landlord the amount so applied so that Landlord shall have
the full Security Deposit on hand at all times during the Lease Term.
In the event Tenant defaults on its obligations to pay Base Rent,
Additional Rent or any other sum beyond seven (7) days from when due on
more than two occasions during any twelve (12) month period, Landlord
may, at any time thereafter require an increase in the Security Deposit
by an amount equal to one hundred percent (100%) of the amount
specified in the definition of the term Security Deposit and Tenant
shall immediately deposit such additional amount with Landlord upon
Landlord's demand. Following such increase, the definition of the term
Security Deposit shall refer to the amount of the Security Deposit
prior to the increase plus the increased amount. The remedy of
increasing the Security Deposits for Tenant's multiple
5
defaults shall be in addition to and not a substitute for any of
Landlord's other rights and remedies under this Lease or applicable
Law. Additionally, Landlord's use or application of all or any portion
of the Security Deposit shall not impair any other rights or remedies
provided under this Lease or under applicable law and shall not be
construed as a payment of liquidated damages. If Tenant shall have
fully compiled with all of the covenants and conditions of this Lease,
the remaining Security Deposit shall be repaid to Tenant, without
interest, within thirty (30) Business Days after the expiration of this
Lease. Tenant may not mortgage, assign, transfer or encumber the
Security Deposit and any such act on the part of Tenant shall be
without force or effect. In the event any bankruptcy, insolvency,
reorganization or other creditor-debtor proceedings shall be instituted
by or against Tenant, the Security Deposit shall be deemed to be
applied first to the payment of Base Rent, Additional Rent and all
other sums payable under this Lease to Landlord for all periods prior
to the institution of such proceedings and the balance, if any, may be
retained by Landlord and applied against Landlord's damages. In the
event of a sale or transfer of Landlord's estate or interest in the
Land and Building, Landlord shall have the right to transfer the
Security Deposit to the vendee or the transferee, and, provided that
Landlord transfers the Security Deposit to such vendee or transferee,
Landlord shall be considered released by Tenant from all liability for
the return of the Security Deposit. Provided the security deposit is
received by the transferee, or the transferee is otherwise credited in
the amount of the security deposit, Tenant shall look solely to the
transferee for the return of the Security Deposit, and it is agreed
that all of the foregoing shall apply to every transfer or assignment
made of the Security Deposit to a new transferee. No mortgagee or
purchaser of any or all of the Building at any foreclosure proceeding
brought under the provisions of any mortgage shall (regardless of
whether the Lease is at the time in question subordinated to the lien
of any mortgage) be liable to Tenant or any other person for any or all
of such sum (or any other or additional security deposit or other
payment made by Tenant under the provisions of this Lease), unless
Landlord has actually delivered it in cash to such mortgagee or
purchaser, as the case may be. In the event of any rightful and
permitted assignment of Tenant's interest in this Lease, the Security
Deposit shall be deemed to be held by Landlord as a deposit made by the
assignee, and Landlord shall have no further liability to the assignor
with respect to the return or the Security Deposit.
No right or remedy available to Landlord in this Lease shall
preclude or extinguish any other right to which Landlord may be
entitled. It is understood that if Tenant fails to perform its
obligations and to take possession of the Premises as provided in this
Lease, the Prepaid Rent and the Security Deposit shall not be deemed
liquidated damages. Landlord may apply such sums to reduce Landlord's
damages and such application of funds shall not preclude Landlord from
recovering from Tenant all additional damages incurred by Landlord.
3.4 ADDITIONAL RENT. Definitions of certain terms used in this paragraph
are set forth in subparagraph 3.4.5. Tenant agrees to pay to Landlord,
as additional rent as computed in this paragraph (individually and
collectively the "Additional Rent"), all Operating Costs Allocable to
the Premises. Tenant acknowledges that this is intended to be a
triple net lease.
3.4.1 RENTAL ADJUSTMENT FOR ESTIMATED OPERATING COSTS. Landlord shall
furnish Tenant a written statement of Estimated Operating Costs
Allocable to the Premises for each Year and the amount payable
monthly by Tenant for such Costs shall be computed as follows:
one-twelfth (1/12) of the amount of Estimated Operating Costs
Allocable to the Premises shall be Additional Rent and shall be
paid monthly by Tenant for each month during such Year after the
Commencement Date. If such written statement is furnished after
the commencement of the Year (or as to the first Year during the
Lease Term, after the Commencement Date), Tenant shall also make
a retroactive lump-sum payment to Landlord equal to the monthly
payment amount multiplied by the number of months during the
Year (or as to the first Year during the Lease Term, after the
Commencement Date) for which no payment was paid.
Notwithstanding the foregoing, Landlord reserves the right, from
time to time during each Year, to revise the Estimated Operating
Costs Allocable to the Premises and upon notice to Tenant of
such revision, Tenant shall adjust its payment to Landlord under
this subparagraph 3.4.1 accordingly.
3.4.2 ACTUAL COSTS. After the close of each Year, Landlord shall
deliver to Tenant a written statement setting forth the
Operating Costs Allocable to the Premises during the preceding
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Year. If such Operating Costs Allocable to the Premises for any
Year exceed the Estimated Operating Costs Allocable to the
Premises paid by Tenant to Landlord pursuant to subparagraph
3.4.1 for such Year (the "Excess"), Tenant shall pay the amount
of such Excess to Landlord within twenty (20) Business Days
after receipt of such statement by Tenant; provided however,
that if such statement for the first year or second year of the
initial Lease Term only indicate that an Excess of more than
Twenty-Five Thousand Dollars ($25,000.00) exists, then Tenant
may, at its option (the "Amortization Option"), upon written
notice to Landlord within five (5) days after Tenant's receipt
of such statement, pay such Excess (for the 1st or 2nd year, as
applicable, only) over a period of four (4) consecutive months
(commencing on the 1st day of the month immediately following
Tenant's receipt of the statement) in equal monthly
installments, with 10% interest. Notwithstanding anything to the
contrary contained herein, the Amortization Option shall be null
and void after the second year of the initial Lease Term (and
not any extension thereof). If such statement shows the
Operating Costs Allocable to the Premises to be less than the
Estimated Operating Costs Allocable to the Premises paid by
Tenant to Landlord pursuant to subparagraph 3.4.1, then the
amount of such overpayment shall be paid by Landlord to Tenant
within twenty (20) Business Days following the date of such
statement or, at Landlord's option, shall be credited towards
the installment(s) of Additional Rent next coming due from
Tenant.
3.4.3 DETERMINATION OF OPERATING COSTS. The determination of Operating
Costs Allocable to the Premises shall be made by Landlord.
3.4.4 END OF TERM. If this Lease shall terminate on a day other than
the last day of a Year, (a) Landlord shall estimate the
Operating Costs Allocable to the Premises for such Year
predicated on the most recent reliable information available to
Landlord; (b) the amount determined under clause (a) of this
sentence shall be prorated by multiplying such amount by a
fraction, the numerator of which is the number of days within
the Lease Term in such Year and the denominator of which is 360;
(c) If the clause (b) amount exceeds the Estimated Operating
Costs Allocable to the Premises paid by Tenant for the last Year
in the Lease Term, then Tenant shall pay the excess to Landlord
within twenty (20) Business Days after Landlord's delivery to
Tenant of a statement for such excess; and (d) if the Estimated
Operating Costs Allocable to the Premises paid by Tenant for the
last Year in the Lease Term exceeds the clause (b) amount, then
Landlord shall refund to Tenant the excess within the twenty
(20) Business Day period described in clause (c) if Tenant Is
not then in default of any of its obligations under this Lease.
Landlord's and Tenant's obligations under this paragraph shall
survive the expiration or other termination of this Lease.
3.4.5 DEFINITIONS. Each underlined term in this subparagraph shall
have the meaning set forth next to that underlined term:
(a) ESTIMATED OPERATING COSTS ALLOCABLE TO THE PREMISES.
Landlord's estimate of Operating Costs Allocable to the Premises
for a Year to be given by Landlord to Tenant pursuant to
subparagraph 3.4.1.
(b) OPERATING COSTS. All expenses paid or incurred by
Landlord in connection with the ownership, operation,
maintenance and/or repair of: (i) the Building; (ii) the
Project, provided that for purposes of this Lease, such expenses
shall be limited to that amount of operating costs for the
entire Project which is fairly and equitably allocated by
Landlord, in its reasonable discretion, to the Building; and
(iii) the personal property used in conjunction with such
maintenance, operation, ownership and repair, including, without
limitation, all expenses reasonably paid or incurred by Landlord
for: (a) common area utilities, including electricity, water,
gas, sewers, fire sprinkler charges, refuse collection,
telephone charges, cable television or other electronic or
microwave signal reception, steam, heat, cooling or any service
which is now or in the future reasonably considered a utility
and which are not payable directly by tenants in the Building;
(b) supplies; (c) cleaning and janitorial services (including
window washing), landscaping and landscaping maintenance
(including irrigating, trimming, mowing, fertilizing, seeding
and replacing plants), and other commercially reasonable
services; (d) security services, if any; (e) insurance; (f)
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management fees, provided that the property management fee shall
not exceed three percent (3%) of the gross rental income for the
Building; (g) Property Taxes, reasonable tax consultant fees and
expenses (not to materially exceed the reduction in taxes
anticipated to be secured), and reasonable costs of appeals of
any Property Taxes; (h) services of independent contractors; (i)
compensation (including employment taxes and fringe benefits) of
all persons who perform duties in connection with any service,
repair, maintenance, replacement or improvement or other work
included in this subparagraph; (j) license, permit and
inspection fees; (k) assessments and special assessments due to
deed restrictions, declarations or owners associations or other
means of allocating costs of a larger tract of which the Land is
a part; (l) rental of any machinery or equipment; (m) reasonable
audit fees and accounting services related to the Building, and
charges for the computation of the rents and charges payable by
tenants in the Building (but only to the extent the cost of such
fees and services are in addition to the cost of the management
fee); (n) the cost of capital improvements, repairs or
replacements (amortized, as set forth below in this Section
3.4.5(b)); (o) maintenance and service contracts; (p)
maintenance and repair of the roof and roof membranes, (q) costs
incurred by Landlord for compliance with Access Laws, as set
forth in the paragraph entitled "Access Laws"; (r) elevator
service and repair, if any; (s) business taxes and license fees;
(t) maintenance and repair of the HVAC system in the Building
and Project; (u) all payments payable to Edison (defined below)
or its successors or assigns pursuant to the Edison License
(defined below); and (v) any other commercially reasonable
expense or charge which in accordance with generally accepted
accounting and management principles would be considered an
expense of maintaining, operating, owning or repairing the
Building and the Project. Without limiting the foregoing,
Operating Costs shall include replacement of roofs and roof
membranes; exterior painting; parking area resurfacing,
resealing and restriping parking areas and driveways; upgrading
of the HVAC systems in the Building, and other capital
improvements to the Building or to the Project if such costs set
forth earlier in this sentence are to be equitably allocated as
provided above in this subparagraph; PROVIDED THAT, such
capital improvements, whether installed before or after the
Commencement Date, shall be amortized with market interest over
their estimated useful lives as reasonably determined by
Landlord and only the amortization installments and interest
attributable to the Lease Term shall be an Operating Cost under
this Lease.
Operating Costs shall not include any of the following:
A. Interest and amortization of funds borrowed by
Landlord for items other than capital improvements;
B. Leasing commissions and advertising and space planning
expenses incurred in procuring tenants;
C. Salaries, wages, or other compensation paid to
officers or executives of Landlord in their capacities
as officers and executives.
D. Costs of damage and repairs to the extent recovered
under any warranty or insurance policy carried by
Landlord in connection with the Building or common
areas;
E. Any and all costs of any kind or character for any
injuries, damage and repairs necessitated by the
negligence or willful misconduct of Landlord or
Landlord's employees, contractors or agents;
F. Landlord's general overhead expenses not related to
the Project;
G. Payments of principal or interest or any mortgage,
ground rents (other than payments under the Edison
License) including commissions and legal fees
associated with financing;
H. Depreciation or accelerated cost recovery of the
Building or any equipment;
I. Costs, including permit, license and inspection
fees, incurred in renovating or otherwise improving,
decorating, painting or altering space for other
tenants or other occupants or vacant space in the
Project;
J. Costs incurred due to violation by Landlord or any
other tenant of the Building of the terms and
conditions of any lease;
8
K. The costs of any service provided to other tenant(s)
of the Project to the extent Landlord receives direct
reimbursement therefor (including excess electricity
consumption);
L. Charitable or political donations by Landlord;
M. Any cost or expense related to the testing for,
removal, transportation, or storage of Hazardous
Substances from the Building, except to the extent
caused by or required as a result of the acts or
omissions of Tenant or Tenant's Agents;
N. Interest, penalties or other costs arising out of
Landlord's failure to make timely payment of its
obligations;
O. Attorneys' fees and costs of settlement judgments and
payments in lieu thereof arising from disputes with
tenants in connection with the leasing of space at the
Project;
P. Amounts paid to subsidiaries or affiliates of Landlord
for goods and/or services in the Building to the
extent the same materially exceed the costs of such
goods and/or services rendered by unaffiliated third
parties on a competitive basis; and
Q. Expenses which are not treated as operating expenses
by the majority of other landlords in comparable first
class, Class "A" industrial buildings comparable in
location and condition to the Building and located
within the general vicinity of the Ontario, California
area, all as reasonably determined by Landlord.
If less than one hundred percent (100%) of the net rentable area
of the Building is occupied by tenants at all times during any
Year, then Operating Costs for such Year shall include all
additional costs and expenses that Landlord reasonably
determines would have been incurred had one hundred percent
(100%) of the Building been occupied at all times during such
Year by tenants.
(c) OPERATING COSTS ALLOCABLE TO THE PREMISES. The product of
Tenant's Pro Rata Share times Operating Costs.
3.4.6 JANITORIAL SERVICES. Notwithstanding anything to the contrary
contained in this Lease, Tenant shall contract directly with a
janitorial service and shall pay for all janitorial services
used on or for the Premises.
3.4.7 ADDITIONAL RENT. Any sums payable under this Lease pursuant to
this paragraph or otherwise shall be Additional Rent and, in the
event of nonpayment of such sums, Landlord shall have the same
rights and remedies with respect to such nonpayment as it has
with respect to nonpayment of the Base Rent due under this
Lease.
3.4.8 OPERATING COST AUDIT. Landlord shall maintain records concerning
estimated and actual Operating Costs Allocable to the Premises
for no less than twelve (12) months following the period covered
by the statement or statements furnished Tenant, after which
time Landlord may dispose of such records. Provided that Tenant
is not then in default of its obligation to pay Base Rent,
Additional Rent or other payments required to be made by it
under this Lease and provided that Tenant is not otherwise in
default under this Lease, Tenant may, at Tenant's sole cost and
expense, cause a Qualified Person (as defined below) to inspect
Landlord's records. Such inspection, if any, shall be conducted
no more than once each Year, during Landlord's normal business
hours within sixty (60) Business Days after receipt of
Landlord's written statement of Operating Costs Allocable to the
Premises for the previous year, and upon Tenant first furnishing
Landlord written notice of the inspection, if any, at least
fifteen (15) Business Days in advance of such inspection. Any
errors disclosed by the review shall be promptly corrected by
Landlord; provided, however, that if Landlord disagrees with any
such claimed errors, Landlord shall have the right to cause
another review to be made by an auditor of Landlord's choice. In
the event the results of the review of records (taking into
account, if applicable, the results of any additional review
caused by Landlord) reveal that Tenant has overpaid obligations
for a preceding period, the amount of such overpayment shall be
credited against Tenant's subsequent installment of Base Rent,
Additional Rent or other payments due to Landlord
9
under the Lease. In the event that such results show that Tenant
has underpaid its obligations for a preceding period, the amount
of such underpayment shall be paid by Tenant to Landlord with
the next succeeding installment obligation of estimated
Operating Costs Allocable to the Premises. If the actual
Operating Costs Allocable to the Premises for any given Year
were improperly computed and if the actual Operating Costs
Allocable to the Premises are overstated by more than 5%,
Landlord shall reimburse Tenant for the cost of its audit. A
"QUALIFIED PERSON" means an accountant or other person
experienced in accounting for income and expenses of industrial
projects, who is engaged solely by Tenant on terms which do not
entail any compensation based or measured in any way upon any
savings in Additional Rent or reduction in Operating Costs
Allocable to the Premises achieved through the inspection
process described in this subparagraph.
3.5 UTILITIES. Tenant shall contract directly and pay for all water,
gas, heat, light, power, telephone, telecommunications, sewer, fire
sprinkler charges and other utilities used on or from the Premises
together with any taxes, penalties, surcharges or similar charges
relating to such utilities. If any such service is not separately
metered to the Premises, the cost therefor shall be an Operating Cost
under this Lease. If Tenant desires to use the services of a provider
of local telephone or telecommunication services whose equipment is not
then servicing the Building, no such provider shall be permitted to
install its lines or other equipment within the Building without the
prior written consent of Landlord, which consent shall not be
unreasonably withheld.
3.6 HOLDOVER. If Landlord agrees in writing that Tenant may hold over after
the expiration or earlier termination of this Lease, unless the parties
hereto otherwise agree in writing as to the terms of such holding over,
the holdover tenancy shall be subject to termination by Landlord or
Tenant at any time upon not less than thirty (30) days' prior written
notice. If Tenant holds over without the consent of Landlord, the same
shall be a tenancy at will terminable at any time, and Tenant shall be
liable to Landlord for, and Tenant shall indemnify, protect, defend and
hold Landlord harmless from and against, any damages, liabilities,
losses, costs, expenses or claims suffered or caused by such holdover,
including damages and costs related to any successor tenant of the
Premises to whom Landlord could not deliver possession of the Premises
when promised. If Tenant provides Landlord with at least six (6) months
prior written notice that Tenant will hold over (the "Holdover
Notice"), and provided that Landlord consents to such holding over,
then during the first two (2) months of any such holdover tenancy with
consent, Tenant shall pay to Landlord from time to time upon demand, an
amount equal to one hundred twenty five percent (125%) of the then
applicable Base Rent, plus all Additional Rent and other sums payable
under this Lease, and be bound by all the terms, covenants and
conditions specified in this Lease, as so far applicable; during any
subsequent months of any such holdover tenancy with consent, Tenant
shall pay to Landlord from time to time upon demand, an amount equal to
one hundred fifty percent (150%) of the then applicable Base Rent, plus
all Additional Rent and other sums payable under this Lease, and be
bound by all the terms, covenants and conditions specified in this
Lease, as so far applicable. If Tenant does not provide Landlord with
the Holdover Notice, then during any holdover tenancy with Landlord's
consent, Tenant shall pay to Landlord from time to time upon demand, an
amount equal to one hundred fifty percent (150%) of the then applicable
Base Rent, plus all Additional Rent and other sums payable under this
Lease, and be bound by all the terms, covenants and conditions
specified in this Lease, as so far applicable. During any holdover
tenancy without Landlord's consent, Tenant shall pay to Landlord from
time to time upon demand, an amount equal to two hundred percent (200%)
of the then applicable Base Rent, plus all Additional Rent and other
sums payable under this Lease, and be bound by all the terms, covenants
and conditions specified in this Lease, as so far applicable.
Notwithstanding anything to the contrary contained in this Section 3.6,
no holding over by Tenant, whether with or without consent of Landlord,
shall operate to extend this Lease. The preceding provisions of this
Paragraph 3.6 shall not be construed as Landlord's consent to any
holding over by Tenant.
3.7 LATE CHARGE. If Tenant fails to make any payment of Base Rent,
Additional Rent or other amount within seven (7) days from when due
under this Lease, a late charge is immediately due and payable by
Tenant equal to five percent (5%) of the amount of any such payment.
Landlord and Tenant agree that this charge compensates Landlord for the
administrative costs caused by the delinquency. The parties agree that
Landlord's damage would be difficult to compute and the
10
amount stated in this paragraph represents a reasonable estimate of
such damage. Assessment or payment of the late charge contemplated in
this paragraph shall not excuse or cure any Event of Default or breach
by Tenant under this Lease or impair any other right or remedy provided
under this Lease or under law.
3.8 DEFAULT RATE. Any Base Rent, Additional Rent or other sum payable
under this Lease which is not paid when due shall bear interest at a
rate equal to the lesser of: (a) the published prime rate of Xxxxx Bank
N.A., or such other national banking institution designated by Landlord
if such bank ceases to publish a prime rate (the "PRIME RATE"), then in
effect, plus four (4) percentage points, or (b) the maximum rate of
interest per annum permitted by applicable law (the "DEFAULT RATE"),
but the payment of such interest shall not excuse or cure any Event of
Default or breach by Tenant under this Lease or impair any other right
or remedy provided under this Lease or under law.
SECTION 4: GENERAL PROVISIONS
4.1 MAINTENANCE AND REPAIR BY LANDLORD. Subject to the paragraphs
captioned "DAMAGE OR DESTRUCTION" and "CONDEMNATION", Landlord shall
maintain the public and common areas of the Project in reasonably good
order and condition, except ordinary wear and tear, and except for
damage occasioned by the act or omission of Tenant or Tenant's Agents
which shall be paid for entirely by Tenant upon written demand by
Landlord. In the event any or all of the Project becomes in need of
maintenance or repair which Landlord is required to make under this
Lease, Tenant shall immediately give written notice to Landlord, and
Landlord shall not be obligated in any way to commence such maintenance
or repairs until a commercially reasonable time elapses after
Landlord's receipt of such notice. Tenant hereby waives the benefit of
Sections 1941 and 1942 of the California Civil Code and any other
statute providing a right to make repairs and deduct the cost thereof
from the rent. Tenant waives any right to terminate this Lease or
offset or xxxxx Base Rent or Additional Rent or any other charges due
hereunder by reason of any failure of Landlord to make repairs to the
Premises.
Notwithstanding the foregoing, if Tenant provides written notice to
Landlord of an event or circumstance which requires the action of
Landlord with respect to repair and/or maintenance, and such repair
and/or maintenance is of an urgent or critical nature and there is an
imminent threat to the health and safety of Tenant's employees or of
substantial damage to Tenant's property, and Landlord fails to provide
such action within a reasonable period of time, given the circumstances
(taking into account whether an emergency exists), after the receipt of
such notice, but in any event not later than twenty (20) days after
receipt of such notice unless such repair would normally take longer
and Landlord has commenced said repair work within said twenty (20) day
period, then Tenant may proceed to take the required action (provided
that and only so long as such action is necessary for the health and
safety of Tenant's employees or to the property of Tenant and such work
is made in accordance with the provisions of Sections 4.4 and 4.5 of
this Lease, other than the required consent to the alterations set
forth therein) upon delivery of an additional ten (10) business days'
notice to Landlord specifying that Tenant is taking such required
action, and if such action was required under the terms of the Lease to
be taken by Landlord and was not taken by Landlord within such ten (10)
day period, then Tenant shall be entitled to prompt reimbursement by
Landlord of Tenant's actual reasonable costs in taking such action. In
no event, however, shall Tenant be permitted to take any action or
perform any work which will affect the Building systems, the structural
integrity of the Building, the roof of the Building or the exterior of
the Building. Further, if Landlord does not deliver a detailed written
objection to Tenant within thirty (30) days after receipt of an invoice
by Tenant of its costs of taking action which Tenant claims should have
been taken by Landlord, and if such invoice from Tenant sets forth a
reasonably particularized breakdown of its costs and expenses in
connection with taking such action on behalf of Landlord and is
accompanied by lien releases from all contractors performing such
action or work, then Tenant shall be entitled to deduct from Base Rent
payable by Tenant under this Lease, the amount set forth in such
invoice. If, however, Landlord, acting reasonably, delivers to Tenant
within thirty (30) days after receipt of Tenant's invoice, a written
objection to the payment of such invoice, then Tenant shall not be
entitled to such deduction from rent, but as Tenant's sole and
exclusive remedy, Tenant may resort to applicable judicial proceedings
in order to claim actual damages.
11
4.2 MAINTENANCE AND REPAIR BY TENANT. Except as is expressly set forth
as Landlord's responsibility pursuant to the paragraph captioned
"MAINTENANCE AND REPAIR BY LANDLORD," Tenant shall at Tenant's sole
cost and expense keep and maintain all portions of the Premises in good
condition and repair, other than ordinary wear and tear, including
interior painting, cleaning of the interior side of all exterior glass,
plumbing and utility fixtures and installations, carpets and floor
coverings, all interior wall surfaces and coverings including tile and
paneling, replacement of all broken windows (including without
limitation any exterior windows), exterior and interior doors, roof
penetrations and membranes in connection with any Tenant installations
on the roof including satellite dishes, light bulb replacement and
interior preventative maintenance. If Tenant fails to maintain or
repair the Premises in accordance with this paragraph, then Landlord
may, but shall not be required to, enter the Premises upon ten (10)
Business Days prior written notice to Tenant (or immediately without
any notice in the case of an emergency) to perform such maintenance or
repair at Tenant's sole cost and expense. Tenant shall pay to Landlord
the cost of such maintenance or repair plus a twelve and one-half
percent (12.5%) administration fee, within ten (10) Business Days of
written demand from Landlord. Tenant shall, at its own cost and
expense, enter into a regularly scheduled preventive
maintenance/service contract with a maintenance contractor for
servicing all hot water, heating and air conditioning systems and
equipment located within or dedicated solely to the Premises. The
maintenance contractor and the contract must be approved by Landlord,
which approval shall not be unreasonably withheld. Landlord shall
maintain and replace all heating and air conditioning systems not
solely serving the Premises, and all costs associated therewith shall
be included as part of Operating Costs, in accordance with Section 3.4
above; provided however, that notwithstanding anything to the contrary
contained herein, at Landlord's option, Landlord shall maintain the
heating, ventilating and air conditioning systems and equipment
exclusively serving the Premises, and all costs associated with such
maintenance by Landlord shall be paid for by Tenant as Additional Rent
upon demand by Landlord. The service contracts shall include all
services recommended by the equipment manufacturer within the
operation/maintenance manual and shall become effective (and a copy
thereof delivered to Landlord) within thirty (30) days following the
date Tenant takes possession of the Premises.
4.3 COMMON AREAS/SECURITY. The common areas of the Building and Project
shall be subject to Landlord's sole management and control. Without
limiting the generality of the immediately preceding sentence, Landlord
reserves the exclusive right as it deems necessary or desirable to
install, construct, remove, maintain and operate lighting systems,
facilities, improvements, equipment and signs on, in or to all parts of
the common areas; change the number, size, height, layout, or locations
of walks, driveways and truckways or parking areas now or later forming
a part of the Land or Building; make alterations or additions to the
Building or common area; close temporarily all or any portion of the
common areas to make repairs, changes or to avoid public dedication,
provided that, except in the event of emergency, Landlord does not
unreasonably interfere with Tenant's use of the Premises in connection
therewith; grant easements to which the Land will be subject, replat,
subdivide, or make other changes to the Land; place, relocate and
operate utility lines through, over or under the Land and Building; and
use or permit the use of all or any portion of the roofs of the
Building, provided that, except in the event of emergency, Landlord
does not unreasonably interfere with Tenant's use of the Premises in
connection therewith. Landlord has no duty or obligation to provide any
security services in, on or around the Premises, Land or Building, and
Tenant recognizes that security services, if any, provided by Landlord
will be for the sole benefit of Landlord and the protection of
Landlord's property and under no circumstances shall Landlord be
responsible for, and Tenant waives any rights with respect to, Landlord
providing security or other protection for Tenant or Tenant's Agents or
property in, on or about the Land or Building. Subject to Landlord's
prior approval, Tenant may, at its sole cost and expense, install,
establish and maintain security services within the Premises; PROVIDED
THAT such security services, including, without limitation, any
apparatus, facilities, equipment or people utilized in connection with
the provision of such security services, comply with the Governmental
Requirements and shall not cause the Building or the Project to be out
of compliance with the Governmental Requirements. Notwithstanding the
foregoing, any such security services installed, established or
maintained by Tenant must not affect or impact any portion of the
Building, Land or the Project other than the Premises and shall not in
any way limit or interfere with Landlord's ability to exercise its
rights as provided in the paragraph captioned "ACCESS". Tenant's rights
under this
12
subparagraph are subject to all the obligations, limitations and
requirements as set forth in the paragraphs captioned "TENANT
ALTERATIONS" and "TENANT'S WORK PERFORMANCE". Landlord reserves the
right to relocate parking areas and driveways and to build additional
improvements in the common areas so long as Tenant's Parking Rights are
maintained and so long as, except in the event of emergency, Landlord
does not unreasonably interfere with Tenant's use of the Premises in
connection therewith.
4.4 TENANT ALTERATIONS. Tenant shall not make any alterations,
additions or improvements in or to the Premises, or make changes to
locks on doors, or add, disturb or in any way change the roof of the
Premises, any floor covering, wall covering, fixtures, plumbing or
wiring (individually and collectively "TENANT ALTERATIONS"), without
first obtaining the consent of Landlord which may not be unreasonably
withheld or delayed, except that Landlord may withhold its approval in
its sole and absolute discretion if the Tenant Alterations will affect,
as determined by Landlord, the structure or exterior of the Building,
or the Building systems. Tenant shall deliver to Landlord full and
complete plans and specifications for any proposed Tenant Alterations
and, if consent by Landlord is given, all such work shall be performed
at Tenant's expense by Landlord or by Tenant, at Landlord's election.
Tenant shall pay to Landlord all costs incurred by Landlord for any
architectural, engineering, supervisory and/or legal services in
connection with any Tenant Alterations including, without limitation,
Landlord's review of the plans and specifications for the Tenant
Alterations. Without limiting the generality of the foregoing, Landlord
may require Tenant (if Landlord has elected to require Tenant to
perform the Tenant Alterations), at Tenant's sole cost and expense, to
obtain and provide Landlord with proof of insurance coverage and a
payment and performance bond, in forms, amounts and by companies
acceptable to Landlord. Should Tenant make any Tenant Alterations
without Landlord's prior written consent, or without satisfaction of
any conditions established by Landlord, Landlord shall have the right,
in addition to and without limitation of any right or remedy Landlord
may have under this Lease, at law or in equity, to require Tenant to
remove some or all of the Tenant Alterations at Tenant's sole cost and
expense and restore the Premises to the same condition existing prior
to undertaking the Tenant Alterations, or, at Landlord's election,
Landlord may remove such Tenant Alterations and restore the Premises at
Tenant's expense. All Tenant Alterations to the Premises, regardless of
which party constructed them or paid for them, shall become the
property of Landlord and shall remain upon and be surrendered with the
Premises upon the expiration or earlier termination of this Lease;
provided, however, at Landlord's sole election, Tenant shall be
obligated, at its sole cost and expense, to remove all (or such portion
as Landlord shall designate) of the Tenant Alterations and repair any
damage resulting from such removal and return the Premises to the same
condition existing prior to the undertaking upon the expiration or
earlier termination of this Lease. Tenant shall have the right (which
right specifically does not extend to the initial Tenant Improvements
constructed in the Premises by Tenant), at the time it requests
Landlord's consent and delivers all plans and specifications to any
Tenant Alteration to make a written request that Landlord notify Tenant
whether Tenant shall be obligated to remove the applicable Tenant
Alteration at the end of the Lease Term, in which event Tenant shall
only be obligated to remove (i) those Tenant Alterations that Landlord
notified Tenant it must remove at the end of the Lease Term at the same
time of and in connection with Tenant's requested approval of the
Tenant Alterations, and (ii) those Tenant Alterations that Tenant did
not seek or did not obtain Landlord's written consent to leave in place
at the end of the Lease Term, and that Landlord requires Tenant to
remove. If Tenant fails to remove any such Tenant Alterations as
required by Landlord's consent, Landlord may do so and Tenant shall pay
the entire cost thereof to Landlord within ten (10) Business Days after
Tenant's receipt of Landlord's written demand therefor. Tenant shall
reimburse Landlord, upon receipt of demand therefor, for all out of
pocket costs and expenses incurred by Landlord during its review of
Tenant's plans and specifications (regardless of whether Landlord
approves Tenant's request) and Tenant's construction. Nothing contained
in this paragraph or the paragraph captioned "TENANT'S WORK
PERFORMANCE" shall be deemed a waiver of the provisions of the
paragraph captioned "MECHANIC'S LIENS."
4.5 TENANT'S WORK PERFORMANCE. If Tenant is permitted to perform Tenant
Alterations in accordance with the provisions of this Lease, Landlord
may, in its reasonable discretion, require that Tenant provide a
payment and performance bond (not to exceed the total costs of the
Tenant Alterations)
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to cover the entire work to be performed, which bond must be in form,
amount and by a company acceptable to Landlord. Any permitted Tenant
Alterations or any other permitted work to be performed by Tenant in
the Premises (including, without limitation, any initial improvements
in the Premises, if Tenant is to perform any of the Tenant
Improvements) shall be performed by contractors employed by Tenant
under one or more construction contracts, in form and content
reasonably approved in advance in writing by Landlord, which approval
shall be subject to Landlord's discretion. The prime contractor and the
respective subcontractors of any tier shall all: (a) be parties to, and
bound by, a collective bargaining agreement with a labor organization
affiliated with the Building and Construction Trades Council of the AFL
CIO and (b) employ only members of such labor organizations to perform
work within their respective jurisdictions. Landlord's prior written
approval of Tenant's contractors and subcontractors shall be required,
and provided that the foregoing requirements in (a) and (b) are fully
satisfied, then such approval shall not be unreasonably withheld or
delayed. Tenant's contractors, workers and suppliers shall work in
harmony with and not interfere with workers or contractors of Landlord
or other tenants of Landlord. If Tenant's contractors, workers or
suppliers do, in the opinion of Landlord, cause such disharmony or
interference, Landlord's consent to the continuation of such work may
be withdrawn upon written notice to Tenant. All Tenant Alterations
shall be (1) completed in accordance with the plans and specifications
approved by Landlord; (2) completed in accordance with all Governmental
Requirements; (3) carried out promptly in a good and workmanlike
manner; (4) of all new materials; and (5) free of defect in materials
and workmanship. Tenant shall pay for all damage to the Building,
Project and Land caused by Tenant or Tenant's Agents. Tenant shall
indemnify, defend and hold harmless Landlord and Landlord's Agents from
any Claims arising as a result of the Tenant Alterations or any defect
in design, material or workmanship of any Tenant Alterations.
4.6 SURRENDER OF POSSESSION. Tenant shall, at the expiration or earlier
termination of this Lease, surrender and deliver the Premises to
Landlord in as good condition as when received by Tenant from Landlord
or as later improved, reasonable use and wear excepted, and free from
all tenancies or occupancies by any person.
4.7 REMOVAL OF PROPERTY. Unless otherwise agreed to in writing by Landlord,
Tenant agrees that there are and shall be no trade fixtures in the
Premises owned by Tenant. Upon expiration or earlier termination of
this Lease, Tenant may remove its personal property, office supplies,
office furniture and equipment and racks and conveyors if (a) such
items are readily moveable and are not attached to the Premises; (b)
such removal is completed prior to the expiration or earlier
termination of this Lease; (c) Tenant is not in default of any covenant
or condition of this Lease at the time of such removal; and (d) Tenant
immediately repairs all damage caused by or resulting from such
removal. All other property in the Premises and any Tenant Alterations
(including, wall-to-wall carpeting, paneling, wall covering or lighting
fixtures and apparatus) or any other article affixed to the floor,
walls, ceiling or any other part of the Premises, shall become the
property of Landlord and shall remain upon and be surrendered with the
Premises; provided, however, at Landlord's sole election, Tenant shall
be obligated, at its sole cost and expense, to remove all (or such
portion as Landlord shall designate, subject to Section 4.4 above) of
the Tenant Alterations and all (or such portion as Landlord shall
designate, subject to Section 2.4 above) of the Tenant Improvements
constructed in the Premises and repair any damage resulting from such
removal. Tenant waives all rights to any payment or compensation for
such Tenant Alterations. If Tenant shall fail to remove any of its
property of any nature from the Premises or Land at the expiration or
earlier termination of this Lease or when Landlord has the right of
re-entry, Landlord may, at its option, remove and store such property
without liability for loss of or damage to such property, such storage
to be for the account and at the expense of Tenant. If Tenant fails to
pay the cost of storing any such property, Landlord may, at its option,
after it has been stored for a period of twenty (20) Business Days or
more, sell or permit to be sold, any or all such property at public or
private sale (and Landlord may become a purchaser at such sale), In
such manner and at such times and places as Landlord in its sole
discretion may deem proper, without notice to Tenant, and Landlord
shall apply the proceeds of such sale: FIRST, to the cost and expense
of such sale, including reasonable attorney's fees actually incurred;
SECOND, to the payment of the costs or charges for storing any such
property; THIRD, to the payment of any other sums of money which may
then be or later become due Landlord from Tenant under this Lease; and,
FOURTH, the balance, if any, to
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Tenant.
4.8 ACCESS. Tenant shall permit Landlord and Landlord's Agents to enter
into the Premises at any time on at least one (1) Business Day's notice
(except in case of emergency, in which case no notice shall be
required), for the purpose of inspecting the same or for the purpose of
repairing, altering or improving the Premises. Nothing contained in
this paragraph shall be deemed to impose any obligation upon Landlord
not expressly stated elsewhere in this Lease. When reasonably
necessary, Landlord may temporarily close Building or Land entrances,
Building doors or other facilities, without liability to Tenant by
reason of such closure and without such action by Landlord being
construed as an eviction of Tenant or as relieving Tenant from the duty
of observing or performing any of the provisions of this Lease.
Landlord shall have the right to enter the Premises at any time during
the Lease Term for the purpose of showing the Premises to prospective
tenants and to erect on the Premises a suitable sign indicating the
Premises are available. Tenant shall give written notice to Landlord at
least twenty (20) Business Days prior to vacating the Premises and
shall arrange to meet with Landlord for a joint inspection of the
Premises prior to vacating. In the event of Tenant's failure to give
such notice or arrange such joint inspection, Landlord's inspection at
or after Tenant's vacating the Premises shall be conclusively deemed
correct for purposes of determining Tenant's responsibility for repairs
and restoration. Landlord shall not be liable for the consequences of
admitting by passkey, or refusing to admit to the Premises, Tenant or
any of Tenant's Agents, or other persons claiming the right of
admittance.
4.9 DAMAGE OR DESTRUCTION.
4.9.1 RESTORATION OF PREMISES. If the Premises are damaged by fire,
earthquake or other casualty, Tenant shall give immediate
written notice thereof to Landlord. If Landlord estimates that
the damage can be repaired in accordance with the then
established Governmental Requirements within two hundred ten
(210) days after Landlord is notified by Tenant of such damage
and if there are sufficient insurance proceeds available to
repair such damage, then Landlord shall proceed with reasonable
diligence to restore the Premises to substantially the condition
which existed prior to the damage and this Lease shall not
terminate. If, in Landlord's estimation, the damage cannot be
repaired within such 210 day period or if there are insufficient
insurance proceeds available to repair such damage, Landlord may
elect in its absolute discretion to either: (a) terminate this
Lease or (b) restore the Premises to substantially the condition
which existed prior to the damage and this Lease will continue.
If Landlord restores the Premises under this paragraph, then (1)
the Lease Term shall be extended for the time required to
complete such restoration, (2) Tenant shall pay to Landlord,
upon demand, Tenant's Pro Rata Share of any applicable
commercially reasonable deductible amount specified under
Landlord's insurance and (3) Landlord shall not be required to
repair or restore Tenant Improvements, Tenant Alterations, or
any or all furniture, fixtures, equipment, inventory,
improvements or other property which was in or about the
Premises at the time of the damage and was not owned by
Landlord. Base Rent and Additional Rent due under this Lease
during any untenantable period hereunder shall be abated in
proportion to the portion of the Premises rendered untenable
during the untenantable period. Tenant agrees to look to the
provider of Tenant's insurance for coverage for the loss of
Tenant's use of the Premises and any other related losses or
damages incurred by Tenant during any reconstruction period.
Notwithstanding anything to the contrary contained in Section
4.9.1 or 4.9.3 relating to insufficient insurance proceeds, if
the estimated cost of repair of such casualty exceeds the amount
of the insurance proceeds which are payable to Landlord for the
restoration of the Premises (the "Uninsured Cost of Repair"),
Landlord and Tenant agree as follows: (a) if the Uninsured Cost
of Repair (including any deductible) is less than Ten Thousand
Dollars ($10,000.00) and Landlord does not have another basis
for terminating this Lease (e.g., the repair will take longer
than 210 days or the casualty occurs during the final twelve
(12) months of the Lease Term), then this Lease shall not
terminate, and the provisions of Section 4.9.1 governing
Landlord's restoration of the Premises shall apply (which shall
include, without limitation, Tenant's obligation to pay Tenant's
Pro Rata Share of the applicable deductible); and (b) if the
Uninsured Cost of Repair (including any deductible) is more than
Ten Thousand Dollars ($10,000.00), then Landlord may elect in
its absolute
15
discretion to terminate this Lease unless Tenant commits (and
provides Landlord with the necessary funds) to pay for the
Uninsured Cost of Repair greater than Ten Thousand Dollars
($10,000.00) plus Tenant's Pro Rata Share of the applicable
deductible, in which event this Lease shall not terminate
(unless Landlord elects to terminate pursuant to another basis
to do so (e.g., the repair will take longer than 210 days or the
casualty occurs during the final twelve (12) months of the Lease
Term) and the provisions of Section 4.9.1 governing Landlord's
restoration of the Premises shall apply, which shall include,
without limitation, Tenant's obligation to pay Tenant's Pro Rata
Share of the applicable deductible).
4.9.2 DAMAGE IN EXCESS OF FIFTY PERCENT. If the Building is
damaged by fire, earthquake or other casualty and more than
fifty percent (50%) of the Building is rendered untenantable,
without regard to whether the Premises are affected by such
damage, Landlord may in its absolute discretion and without
limiting any other options available to Landlord under this
Lease or otherwise, elect to terminate this Lease by notice in
writing to Tenant within forty (40) Business Days after the
occurrence of such damage. Such notice shall be effective sixty
(60) days after receipt by Tenant unless a later date is set
forth in Landlord's notice.
4.9.3 TERMINATION OF LEASE BY MORTGAGE HOLDER'S ELECTION.
Notwithstanding anything contained in this Lease to the
contrary, if there is damage to the Building and the holder of
any indebtedness secured by a mortgage or deed of trust covering
any such property requires that the insurance proceeds be
applied to such indebtedness or the insurance proceeds are
otherwise inadequate to complete the repair of the damages to
the Building or both, then Landlord shall have the right to
terminate this Lease by delivering written notice of termination
to Tenant within fifteen (15) Business Days after such
requirement is made by such holder, and the Lease shall
terminate as of the date specified by such holder.
4.9.4 DESTRUCTION NEAR END OF TERM. Notwithstanding the
foregoing, if the Building or the Project are wholly or
partially damaged or destroyed within the final twelve (12)
months of the Term, Landlord may, at its option, elect to
terminate this Lease upon written notice given to Tenant within
thirty (30) days following such damage or destruction.
4.9.5 WAIVER. Tenant waives the provisions of any statutes
presently existing or hereafter enacted (including, without
limitation, California Civil Code sections 1932 and 1933) which
relate to termination of leases when the thing leased is
destroyed and agrees that such event will be governed by the
terms of this Lease.
4.9.6. TERMINATION BY TENANT. Notwithstanding anything to the
contrary set forth in this Section 4.9 above, within sixty (60)
days after the date of any such damage or destruction, Landlord
shall endeavor to notify Tenant of the estimated time to
complete the repairs and restoration of the Premises and
Project, as estimated by an independent contractor approved by
Landlord (the "Landlord Response Notice"). Notwithstanding
anything to the contrary set forth in the proceeding paragraph,
if Landlord notifies Tenant that the estimated time to complete
the repairs or restoration will exceed two hundred ten (210)
days from the date of such damage or destruction, Tenant may
terminate this Lease effective as of the date of such damage or
destruction by delivering written notice thereof to Landlord
within thirty (30) days after receipt of Landlord's Response
Notice. If the Lease is not terminated as provided above, and
the repairs and restoration are not completed within two hundred
ten (210) days after the damage or destruction, Tenant may
deliver written notice to Landlord stating that if the repairs
and restoration are not completed within thirty (30) days
thereafter, Tenant will terminate the Lease. If the repairs and
restoration are not completed within thirty (30) days after
Tenant delivers such notice to Landlord, Tenant may terminate
the Lease effective as of the date of such damage or destruction
by delivering written notice thereof to Landlord.
4.10 CONDEMNATION. If all of the Premises, are taken by eminent domain
or by conveyance in lieu thereof, this Lease shall automatically
terminate as of the date the physical taking occurs, and all Base Rent,
Additional Rent and other sums payable under this Lease shall be paid
to that date. In case of taking of a part of the Premises not required
for the Tenant's reasonable use of the Premises, then this Lease shall
continue in full force and effect and the Base Rent shall be equitably
reduced based on the proportion by which the floor area of the Premises
is reduced, such
16
reduction in Base Rent to be effective as of the date the physical
taking occurs. Additional Rent and all other sums payable under this
Lease shall not be abated but Tenant's Pro Rata Share may be
redetermined as equitable under the circumstances. Landlord reserves
all rights to damages or awards for any taking by eminent domain
relating to the Premises, Land and the unexpired term of this Lease.
Tenant assigns to Landlord any right Tenant may have to such damages or
award and Tenant shall make no claim against Landlord for damages for
termination of its leasehold interest or interference with Tenant's
business. Tenant shall have the right, however, to claim and recover
from the condemning authority compensation for any loss to which Tenant
may be entitled for Tenant's moving expenses or other relocation costs;
PROVIDED THAT, such expenses or costs may be claimed only if they are
awarded separately in the eminent domain proceedings and not as a part
of the damages recoverable by Landlord. Tenant waives all rights it may
have under California Code of Civil Procedure section 1265.130, or
otherwise, to terminate this Lease based on a partial condemnation.
4.11 PARKING. Tenant shall have the exclusive privilege to use the
parking spaces allocated to the Building. Tenant's parking privileges
shall be subject to the rules and regulations relating to parking
adopted by Landlord from time to time. Landlord shall have no
obligation whatsoever to monitor, secure or police the use of the
parking or other common areas.
4.12 INDEMNIFICATION. Tenant shall indemnify, defend and hold harmless
Landlord and Landlord's Agents from and against any and all Claims,
arising in whole or in part out of (a) the possession, use or occupancy
of the Premises or the business conducted in the Premises, (b) any act,
omission or negligence of Tenant or Tenant's Agents, or (c) any breach
or default under this Lease by Tenant. Neither Landlord nor Landlord's
Agents shall, to the extent permitted by law, have any liability to
Tenant or to Tenant's Agents, for any Claims arising out of any cause
whatsoever, including repair to any portion of the Premises;
interruption in the use of the Premises or any equipment therein; any
accident or damage resulting from any use or operation by Landlord,
Tenant or any person or entity of heating, cooling, electrical,
sewerage or plumbing equipment or apparatus; termination of this Lease
by reason of damage to the Premises; fire, robbery, theft, vandalism,
mysterious disappearance or any other casualty; actions of any other
tenant of the Building or of any other person or entity; inability to
furnish any service required of Landlord as specified in this Lease; or
leakage in any part of the Premises from rain, ice or snow, or from
drains, pipes or plumbing fixtures in the Premises; except for Claims
arising solely out of the negligence or willful misconduct of Landlord
in failing to repair or maintain the Building as required by this Lease
after notice by Tenant as required by the paragraph captioned
"MAINTENANCE AND REPAIR BY LANDLORD"; PROVIDED THAT, in no event shall
Landlord be responsible for any interruption to Tenant's business or
for any indirect or consequential losses suffered by Tenant or Tenant's
Agents. The obligations of this paragraph shall be subject to the
paragraph entitled "WAIVER OF SUBROGATION."
4.13 TENANT INSURANCE.
4.13.1 FORM OF POLICIES. Tenant shall, throughout the Lease Term,
at its own expense, keep and maintain in full force and effect
the following policies, each of which shall be endorsed as
needed to provide that the insurance afforded by these policies.
is primary and that all insurance carried by Landlord is
strictly excess and secondary and shall not contribute with
Tenant's liability insurance:
(a)A policy of commercial general liability insurance, including
a contractual liability endorsement covering Tenant's
obligations under the paragraph captioned "INDEMNIFICATION",
insuring against claims of bodily injury and death or
property damage or loss with a combined single limit at the
Commencement Date of this Lease of not less than One Million
Dollars ($1,000,000.00) per occurrence and Two Million
Dollars ($2,000,000.00) in the aggregate, which limit shall
be reasonably increased during the Lease Term at Landlord's
request to reflect both increases in liability exposure
arising from inflation as well as from changing use of the
Premises or changing legal liability standards, which policy
shall be payable on an "occurrence" rather than a "claims
made" basis, and which policy identifies Landlord and Manager
and, at Landlord's request, Landlord's mortgage lender(s) or
investment advisors, as additional named insureds;
17
(b)A policy of extended property insurance (what is commonly
called "all risk") covering Tenant's Improvements and
Tenant's Alterations, furniture, fixtures, equipment,
inventory, and other personal property located on the
Premises for one hundred percent (100%) of the current
replacement value of such property;
(c)Business interruption insurance in an amount sufficient to
cover costs, damages, lost income, expenses, Base Rent,
Additional Rent and all other sums payable under this Lease,
should any or all of the Premises not be usable for a period
of up to twelve (12) months;
(d)A policy of worker's compensation insurance as required by
law and employer's liability insurance with limits of no less
than One Million Dollars ($1,000,000); and
(e)A policy of comprehensive automobile liability insurance,
including loading and unloading, and covering owned,
non-owned and hired vehicles, with limits of no less than One
Million Dollars ($1,000,000) per occurrence.
4.13.2 APPROVAL OF INSURER. All insurance policies required under
this paragraph shall be with companies with a Best rating of
AXII or better and each policy shall provide that it is not
subject to cancellation or reduction in coverage except after
thirty (30) days' written notice to Landlord. Tenant shall
deliver to Landlord and, at Landlord's request Landlord's
mortgage lender(s), prior to the Commencement Date and from time
to time thereafter, certificates evidencing the existence and
amounts of all such policies.
4.13.3 LANDLORD OBTAINED INSURANCE. If Tenant fails to acquire or
maintain any insurance or provide any certificate required by
this paragraph, Landlord may, but shall not be required to,
obtain such insurance or certificates and the costs associated
with obtaining such insurance or certificates shall be payable
by Tenant to Landlord on demand.
4.14 LANDLORD'S INSURANCE. Landlord shall, throughout the Lease Term, keep
and maintain in full force and effect the following insurance, which
insurance may, at Landlord's discretion, contain such deductibles as
Landlord deems appropriate:
(a) A policy of commercial general liability insurance, insuring
against claims of bodily injury and death or property damage or loss
with a combined single limit at the Commencement Date of not less than
Five Million Dollars ($5,000,000.00), which policy shall be payable on
an "occurrence" rather than a "claims made" basis; and
(b) A policy of extended property insurance (what is commonly called
"all risk") covering the Building and Landlord's personal property, if
any, located on the Property in the amount of one hundred percent
(100%) of the then current replacement value of such property.
(c) Landlord may, but shall not be required to, maintain other
types of insurance as Landlord deems appropriate (with such deductibles
as Landlord deems appropriate), including, but not limited to, property
insurance coverage for earthquakes and floods in such amounts as
Landlord deems appropriate. Such policies may be "blanket" policies
which cover other properties owned by Landlord.
4.15 WAIVER OF SUBROGATION. Notwithstanding anything in this Lease to the
contrary, Landlord and Tenant hereby each waive and release the other
from any and all Claims or any loss or damage that may occur to the
Land, Building or personal property located therein, by reason of fire
or other casualty regardless of cause or origin, including the
negligence or misconduct of Landlord, Tenant, Landlord's Agents or
Tenant's Agents, but only to the extent of the insurance proceeds paid
to such releasor under its policies of insurance or, if it fails to
maintain the required policies, the insurance proceeds that would have
been paid to such releasor if it had maintained such policies. Each
party to this Lease shall promptly give to its insurance company
written notice of the mutual waivers contained in this subparagraph,
and shall cause its insurance policies to be properly endorsed, if
necessary, to prevent the invalidation of any insurance coverages by
reason of the mutual waivers contained in this subparagraph.
4.16 ASSIGNMENT AND SUBLETTING BY TENANT.
4.16.1 RESTRICTIONS ON TRANSFER. Tenant shall not have the right
to assign, transfer, mortgage or encumber this Lease in whole or
in part, nor sublet the whole or any part of the Premises, nor
allow the occupancy of all or any part of the Premises by
another,
18
without first obtaining Landlord's consent, which consent may
not be unreasonably withheld. Notwithstanding any permitted
assignment or subletting, Tenant shall at all times remain
directly, primarily and fully responsible and liable for the
payment of all sums payable under this Lease and for compliance
with all of its other obligations as tenant under this Lease.
Upon the occurrence of an Event of Default, if the Premises or
any part of the Premises are then subject to an assignment or
subletting, Landlord, in addition to any other remedies provided
in this Lease or by law, may at its option collect directly from
such assignee or subtenant all rents becoming due to Tenant
under such assignment or sublease and apply such rents against
any sums due to Landlord from Tenant under this Lease, and no
such collection shall be construed to constitute a novation or
release of Tenant from the further performance of Tenant's
obligations under this Lease. Tenant makes an absolute
assignment to Landlord of such assignments and subleases and any
rent, security deposits and other sums payable under such
assignments and subleases as collateral to secure the
performance of the obligations of Tenant under this Lease.
4.16.2 LANDLORD CONSENT, PROCEDURE. In the event Tenant desires to
assign this Lease or to sublet all or any portion of the
Premises, Tenant shall give written notice of such desire to
Landlord setting forth the name of the proposed subtenant or
assignee, the proposed term, the nature of the proposed
subtenant's or assignee's business to be conducted on the
Premises, the rental rate, and any other particulars of the
proposed subletting or assignment that Landlord may reasonably
request. Without limiting the preceding sentence, Tenant shall
also provide Landlord with: (a) such financial information as
Landlord may request concerning the proposed subtenant or
assignee, including recent financial statements certified as
accurate and complete by a certified public accountant and by
the president, managing partner or other appropriate officer of
the proposed subtenant or assignee; (b) proof satisfactory to
Landlord that the proposed subtenant or assignee will
immediately occupy and thereafter use the entire Premises (or
any sublet portion of the Premises) for the remainder of the
Lease Term (or for the entire term of the sublease, if shorter)
in compliance with the terms of this Lease; and (c) a copy of
the proposed sublease or assignment or letter of intent. Tenant
shall pay to Landlord, upon Landlord's demand therefor,
Landlord's reasonable attorneys' fees incurred in the review of
such documentation and in documenting Landlord's consent, plus
an administrative fee of $1,000.00 for processing such proposed
assignment or sublease. Receipt of such fees shall not obligate
Landlord to approve the proposed assignment or sublease.
4.16.3 LANDLORD CONSENT, RELEVANT FACTORS. In determining whether
to grant or withhold consent to a proposed assignment or
sublease, Landlord may consider, and weigh, any factor it deems
relevant in its reasonable discretion. Without limiting what may
be construed as a factor considered by Landlord, Tenant agrees
that any one or more of the following will be proper grounds for
Landlord's disapproval of a proposed assignment or sublease:
(a) The proposed assignee or subtenant does not, in Landlord's
good faith judgment, have financial worth or creditworthiness
equal to or greater than that of Tenant as of the execution date
of this Lease or sufficient financial worth to insure full and
timely performance under this Lease;
(b) Landlord has received insufficient evidence of the financial
worth or creditworthiness of the proposed assignee or subtenant
to make the determination set forth in clause (b);
(c) The proposed assignee or subtenant has a reputation for
disputes in contractual relations, failure to observe and
perform its contractual obligations in a timely and complete
manner or for negative business relations in the business
community for or otherwise as a tenant of property or otherwise;
(d) Landlord has received from any prior lessor of the proposed
assignee or subtenant a negative report concerning such prior
lessor's experience with the proposed assignee or subtenant;
(e) Landlord has had prior negative leasing experience with the
proposed assignee or
19
subtenant;
(f) The use of the Premises by the proposed assignee or
subtenant will not be identical with the Permitted Uses;
(g) In Landlord's judgment, the proposed assignee or subtenant
is engaged in a business, or the Premises or any part of the
Premises will be used in a manner, that is not in keeping with
the then standards of the Building, or that is not compatible
with the businesses of other tenants in the Building, or that is
inappropriate for the Project, or that will violate any negative
covenant as to use contained in any other lease of space in the
Project;
(h) The use of the Premises by the proposed assignee or
subtenant will violate any Governmental Requirement or create a
violation of Access Laws;
(i) Tenant is in default of any obligation of Tenant under this
Lease, or Tenant has defaulted under this Lease on three (3) or
more occasions during the twenty-four (24) months preceding the
date that Tenant shall request such consent;
(j) Landlord does not reasonably approve of any of the tenant
improvements required for the proposed assignee or subtenant; or
(k) Landlord has had negotiations with the proposed assignee or
subtenant, in the six (6) months preceding Tenant's request,
regarding the leasing of space by such proposed assignee or
subtenant in the Project.
4.16.4 NOTICE REGARDING LANDLORD'S CONSENT. Within fifteen (15)
Business Days after Landlord's receipt of all required
information to be supplied by Tenant pursuant to this paragraph,
Landlord shall notify Tenant of Landlord's approval, disapproval
or conditional approval of any proposed assignment or subletting
or of Landlord's election to require recapture as described
below. Landlord shall have no obligation to respond unless and
until all required information has been submitted. In the event
Landlord approves of any proposed assignment or subletting,
Tenant and the proposed assignee or sublessee shall execute and
deliver to Landlord an assignment (or subletting) and assumption
agreement in form and content satisfactory to Landlord in its
sole discretion.
4.16.5 RESTRICTION OF TRANSFER OF INTERESTS IN TENANT. Any
transfer, assignment or hypothecation of any of the stock or
interest in, or the assets of, Tenant which is either: (a)
greater than fifty percent (50%) of such stock, interest or
assets, or (b) intended as a subterfuge denying Landlord the
benefits of this paragraph, shall be deemed to be an assignment
within the meaning and provisions of this paragraph and shall be
subject to the provisions of this paragraph.
4.16.6 EXCESS RENT. If Landlord consents to any assignment or
sublease and Tenant receives rent or any other consideration,
either initially or over the term of the assignment or sublease,
in excess of the Base Rent and Additional Rent (or, in the case
of a sublease of a portion of the Premises, in excess of the
Base Rent paid by Tenant on a square footage basis under this
Lease), Tenant shall pay to Landlord fifty percent (50%) of such
excess.
4.16.7 RECAPTURE. Landlord shall have the right to recapture the
Premises or the applicable portion thereof (a "RECAPTURE") by
giving written notice of such Recapture to Tenant within fifteen
(15) Business Days after receipt of Tenant's written request for
Landlord's consent to such proposed assignment or subletting;
provided however, that Landlord shall not have such recapture
right in the case of a sublease, not intended as a subterfuge,
for less than fifty percent (50%) of the Premises (and
when combined with other subleases in effect is for less than
50% of the Premises) when the term of such sublease
unconditionally expires with at least one (1) year remaining in
the initial Lease Term. Tenant shall have no right to retract
its request for Landlord's consent to assign or sublease once
such request has been made. Such Recapture shall terminate this
Lease as to the applicable space effective on the prospective
effective date of assignment or subletting, which shall be the
last day of a calendar month and shall not be earlier than
forty-five (45) Business Days after receipt of Tenant's request
hereunder. If less than the entire Premises are recaptured,
Landlord and Tenant agree that this Lease shall remain in full
force and effect with respect to that remaining area not
recaptured by Landlord. Tenant agrees to
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surrender that portion of the Premises recaptured by Landlord in
accordance with the terms and conditions of this Lease.
4.17 ASSIGNMENT BY LANDLORD. Landlord shall have the right to transfer and
assign, in whole or in part, its rights and obligations under this
Lease and in any and all of the Land or Building. If Landlord sells or
transfers any or all of the Building, Landlord and Landlord's Agents
shall, upon consummation of such sale or transfer, be released
automatically from any liability relating to obligations or covenants
under this Lease to be performed or observed after the date of such
transfer, and in such event, Tenant agrees to look solely to Landlord's
successor-in-interest with respect to such liability; PROVIDED THAT, as
to the Security Deposit and Prepaid Rent, Landlord shall not be
released from liability therefor unless Landlord has delivered (by
direct transfer or credit against the purchase price) the Security
Deposit or Prepaid Rent to its successor-in-interest.
4.18 ESTOPPEL CERTIFICATES AND FINANCIAL STATEMENTS. Tenant shall, from time
to time, upon the written request of Landlord, execute, acknowledge and
deliver to Landlord or its designee a written statement stating: (a)
the date this Lease was executed and the date it expires; (b) the date
Tenant entered into occupancy of the Premises; (c) the amount of
monthly Base Rent and Additional Rent and the date to which such Base
Rent and Additional Rent have been paid; and (d) certifying that (1)
this Lease is in full force and effect and has not been assigned,
modified, supplemented or amended in any way (or specifying the date of
the agreement so affecting this Lease); (2) Landlord is not in breach
of this Lease (or, if so, a description of each such breach) and that
no event, omission or condition has occurred which would result, with
the giving of notice or the passage of time or both, in a breach of
this Lease by Landlord; (3) this Lease represents the entire agreement
between the parties with respect to the Premises; (4) all required
contributions by Landlord to Tenant on account of Tenant Improvements
have been received; (5) on the date of execution, there exist no
defenses or offsets which the Tenant has against the enforcement of
this Lease by the Landlord; (6) no Base Rent, Additional Rent or other
sums payable under this Lease have been paid in advance except for Base
Rent and Additional Rent for the then current month or any prepaid rent
as specified on the Estoppel Certificate; (7) no security has been
deposited with Landlord (or, if so, the amount of such security); (8)
it is intended that any Tenant's statement may be relied upon by a
prospective purchaser or mortgagee of Landlord's interest or an
assignee of any such mortgagee; and (9) such other information as may
be reasonably requested by Landlord. If Tenant fails to respond within
five (5) Business Days of its receipt of a written request by Landlord
as provided in this paragraph, such shall be a breach of this Lease and
Tenant shall be deemed to have admitted the accuracy of any information
supplied by Landlord to a prospective purchaser, mortgagee or assignee.
In addition, Tenant shall, from time to time, upon the written request
of Landlord, deliver to or cause to be delivered to Landlord or its
designee then current financial statements (including a statement of
operations and balance sheet) certified as accurate by a certified
public accountant and prepared in conformance with generally accepted
accounting principles for (i) Tenant, (ii) any entity which owns a
controlling interest in Tenant, (iii) any entity the controlling
interest of which is owned by Tenant, (iv) any successor entity to
Tenant by merger or operation of law, and (v) any guarantor of this
Lease.
4.19 MODIFICATION FOR LENDER. If, in connection with obtaining
construction, interim or permanent financing for the Building or Land,
Landlord's lender, if any, shall request reasonable modifications to
this Lease as a condition to such financing, Tenant will not
unreasonably withhold or delay its consent to such modifications;
PROVIDED THAT, such modifications do not increase the obligations of
Tenant under this Lease or materially adversely affect Tenant's rights
under this Lease.
4.20 HAZARDOUS SUBSTANCES.
4.20.1 Tenant agrees that neither Tenant, any of Tenant's
Agents nor any other person will store, place, generate,
manufacture, refine, handle, or locate on, in, under or around
the Land or Building any Hazardous Substance, except for
storage, handling and use of reasonable quantities and types of
cleaning fluids and office supplies in the Premises in the
ordinary course and the prudent conduct of Tenant's business in
the Premises, PROVIDED THAT, (a) the storage, handling and use
of such permitted Hazardous Substances must at all times conform
to all Governmental Requirements and to applicable fire, safety
and insurance requirements; (b) the types and quantities of
permitted Hazardous Sub-stances which are stored in the Premises
must be reason-able and appropriate to the nature and
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size of Tenant's operation in the Premises and reasonable and
appropriate for a first-class building of the same or similar
use and in the same market area as the Building; (c) no
Hazardous Substance shall be spilled or disposed of on, in,
under or around the Land or Building or otherwise discharged
from the Premises or any area adjacent to the Land or Building;
and (d) in no event will Tenant be permitted to store, handle or
use on, in, under or around the Premises any Hazardous Substance
which will increase the rate of fire or extended coverage
insurance on the Land or Building, unless: (1) such Hazardous
Substance and the expected rate increase have been specifically
disclosed in writing to Landlord; (2) Tenant has agreed in
writing to pay any rate increase related to each such Hazardous
Substance; and (3) Landlord has approved in writing each such
Hazardous Substance, which approval shall be subject to
Landlord's discretion.
4.20.2 Tenant shall indemnify, defend and hold harmless Landlord
and Landlord's Agents from and against any and all Claims
arising out of any breach of any provision of this paragraph,
which expenses shall also include laboratory testing fees,
personal injury claims, clean-up costs and environmental
consultants' fees. Tenant agrees that Landlord may be
irreparably harmed by Tenant's breach of this paragraph and that
a specific performance action may appropriately be brought by
Landlord; PROVIDED THAT, Landlord's election to bring or not
bring any such specific performance action shall in no way
limit, waive, impair or hinder Landlord's other remedies against
Tenant.
4.20.3 As of the execution date of this Lease, Tenant represents
and warrants to Landlord that, except as otherwise disclosed by
Tenant to Landlord, Tenant has no intent to bring any Hazardous
Substances on, in or under the Premises except for the type and
quantities authorized in the first paragraph of the paragraph
captioned "HAZARDOUS SUBSTANCES."
4.21 ACCESS LAWS.
4.21.1 NOTICE TO LANDLORD OF VIOLATION. Tenant agrees to notify
Landlord immediately if Tenant receives notification or
otherwise becomes aware of: (a) any condition or situation on,
in, under or around the Land or Building which may constitute a
violation of any Access Laws or (b) any threatened or actual
lien, action or notice that the Land or Building is not in
compliance with any Access Laws. If Tenant is responsible for
such condition, situation, lien, action or notice under this
paragraph, Tenant's notice to Landlord shall include a statement
as to the actions Tenant proposes to take in response to such
condition, situation, lien, action or notice
4.21.2 PROHIBITED ACTS. Tenant shall not alter or permit any
assignee or subtenant or any other person to alter the Premises
in any manner which would violate any Access Laws or increase
Landlord's responsibilities for compliance with Access Laws,
without the prior approval of the Landlord. In connection with
any such approval, Landlord may require a certificate of
compliance with Access Laws from an architect, engineer or other
person acceptable to Landlord. Tenant agrees to pay the
reasonable fees incurred by such architect, engineer or other
third party in connection with the issuance of such certificate
of compliance. Landlord's consent to any proposed Tenant
Alteration shall (a) not relieve Tenant of its obligations or
indemnities contained in this paragraph or this Lease or (b) be
construed as a warranty that such proposed alternation complies
with any Access Law.
4.21.3 TENANT RESPONSIBILITY. Tenant shall be solely responsible
for all costs and expenses relating to or incurred in connection
with: (a) failure of the Premises to comply with the Access
Laws, subject to the second paragraph of 4.21.4; and (b)
bringing the Building and the common areas of the Building into
compliance with Access Laws, if and to the extent such
noncompliance arises out of or relates to: (1) Tenant's use of
the Premises, including the hiring of employees; (2) any Tenant
Alterations to the Premises; or (3) any Tenant Improvements
constructed in the Premises at the request of Tenant, regardless
of whether such improvements are constructed prior to or after
the Commencement Date.
4.21.4 LANDLORD RESPONSIBILITY. Landlord shall be responsible
for all costs and expenses relating to or incurred in connection
with bringing the common areas of the
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Building into compliance with Access Laws, unless such costs and
expenses are Tenant's responsibility as provided in the
preceding subparagraph. Any cost or expense paid or incurred by
Landlord to bring the Premises or common areas of the Building
into compliance with Access Laws which is not Tenant's
responsibility under the preceding subparagraphs shall be
amortized over the useful economic life of the improvements
(not to exceed ten (10) years) using an amortization rate of
twelve percent (12%) per annum, and shall be an Operating Cost
for purposes of this Lease.
Landlord shall also be responsible for causing the Premises
to be in compliance with the Americans With Disabilities Act of
1990 (the "ADA") as of the date of this Lease. All costs
incurred in order to cause the Premises to comply with such laws
are hereinafter referred to as "Compliance Costs".
Notwithstanding the foregoing, Tenant shall be responsible for
all Compliance Costs resulting from or triggered by (i) Tenant's
particular use of the Premises, or (ii) any alterations,
improvements, repairs or additions made with respect to the
Premises by or for Tenant, or (iii) the Tenant Improvements, or
(iv) acts or omissions of Tenant or Tenant's Agents.
4.21.5 INDEMNITY OF LANDLORD. Tenant agrees to indemnify, defend
and hold harmless Landlord and Landlord's Agents from and
against any and all Claims arising out of or relating to any
failure of Tenant or Tenant's Agents to comply with Tenant's
obligations under this paragraph.
4.21.6 INCONSISTENT PROVISIONS OF LAW. The provisions of this
paragraph shall supersede any other provisions in this Lease
regarding Access Laws, to the extent inconsistent with the
provisions of any other paragraphs.
4.22 QUIET ENJOYMENT. Landlord covenants that Tenant, upon paying Base Rent,
Additional Rent and all other sums payable under this Lease and
performing all covenants and conditions required of Tenant under this
Lease shall and may peacefully have, hold and enjoy the Premises
without hindrance or molestation by Landlord, subject to the terms of
this Lease, any ground lease, mortgage or deed of trust and all matters
of record now or hereafter encumbering the Premises or the Project.
4.23 SIGNS. Subject to compliance with all Governmental Requirements and all
matters of record, Tenant shall have the right to install, at Tenant's
sole cost and expense, Project standard signage on the exterior of the
Building. The exact size, appearance and location of such signs shall
be subject to Landlord's prior written approval and shall be consistent
with Landlord's existing sign criteria then in existence for the
Building. Any and all costs in connection with the permitting,
fabrication, installation, maintenance and removal of Tenant's sign
(including the cost of removal of the sign and repair to the Building
caused by such removal) shall be borne by Tenant. Tenant agrees to
maintain any such sign, awning, canopy, decoration, lettering,
advertising matter or other thing as may be approved, in good condition
at all times. Tenant shall not inscribe an inscription, or post, place,
or in any manner display any sign, notice, picture, placard or poster,
or any advertising matter whatsoever, anywhere in or about the Land or
Building at places visible (either directly or indirectly as an outline
or shadow on a glass pane) from anywhere outside the Premises without
first obtaining Landlord's consent. Upon vacation of the Premises on
the expiration or earlier termination of this Lease, Tenant shall be
responsible, at its sole cost, for the removal of such sign or signs
and the repair, painting and/or replacement of the structure to which
the sign or signs were attached, including discoloration caused by such
installation or removal. If Tenant fails to perform such work, Landlord
may cause the same to be performed, and the cost thereof shall be
Additional Rent immediately due and payable upon rendition of a xxxx
therefor.
4.24 SUBORDINATION. Provided Tenant is given written assurance in the
applicable lender's standard subordination, non-disturbance and
attornment form, Tenant subordinates this Lease and all rights of
Tenant under this Lease to any mortgage, deed of trust, ground lease or
vendor's lien, or similar instrument which may from time to time be
placed upon the Premises (and all renewals, modifications, replacements
and extensions of such encumbrances), and each such mortgage, deed of
trust, ground lease or lien or other instrument shall be superior to
and prior to this Lease. At the request of Landlord, the holder of such
mortgage or deed of trust or any ground Lessor, Tenant shall execute,
acknowledge and deliver promptly in recordable form any instrument or
subordination agreement that Landlord or such holder may request;
provided, however, such
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instrument shall include a nondisturbance provision on the standard
form of the applicable lender or ground lessor. Notwithstanding the
foregoing, the holder or beneficiary of such mortgage, deed of trust,
ground lease, vendor's lien or similar instrument shall have the right
to subordinate or cause to be subordinated any such mortgage, deed of
trust, ground lease, vendor's lien or similar instrument to this Lease.
Tenant further covenants and agrees that if the lender or ground lessor
acquires the Premises as a purchaser at any foreclosure sale or
otherwise, Tenant shall recognize and attorn to such party as landlord
under this Lease, and shall make all payments required hereunder to
such new landlord without deduction or set-off and, upon the request of
such purchaser or other successor, execute, deliver and acknowledge
documents confirming such attornment. Tenant waives the provisions of
any law or regulation, now or hereafter in effect, which may give or
purport to give Tenant any right to terminate or otherwise adversely
affect this Lease or the obligations of Tenant hereunder in the event
that any such foreclosure or termination or other proceeding is
prosecuted or completed.
4.25 WORKERS COMPENSATION IMMUNITY. If and to the extent that Tenant is
obligated to indemnify, defend or hold harmless Landlord or Landlord's
Agents from any Claims arising from its use of the Premises or any act
or failure to act by Tenant or Tenant's Agents or otherwise, Tenant
expressly waives, to and in favor of Landlord and Landlord's Agents,
its statutory workers compensation act employers immunity relative to
any injury to an employee or employees of Tenant.
4.26 BROKERS. Each party to this Lease shall indemnify, defend and hold
harmless the other party from and against any and all Claims asserted
against such other party by any real estate broker, finder or
intermediary relating to any act of the indemnifying party in
connection with this Lease.
4.27 EXCULPATION AND LIMITATION OF LIABILITY. Landlord has executed this
Lease by its trustee signing solely in a representative capacity.
Notwithstanding anything contained in this Lease to the contrary,
Tenant confirms that the covenants of Landlord are made and intended,
not as personal covenants of the trustee, or for the purpose of binding
the trustee personally, but solely in the exercise of the
representative powers conferred upon the trustee by its principal.
Liability with respect to the entry and performance of this Lease by or
on behalf of Landlord, however it may arise, shall be asserted and
enforced only against Landlord's estate and equity interest in the
Building. Neither Landlord nor any of Landlord's Agents shall have any
personal liability in the event of any claim against Landlord arising
out of or in connection with this Lease, the relationship of Landlord
and Tenant or Tenant's use of the Premises. Further, in no event
whatsoever shall any Landlord's Agent have any liability or
responsibility whatsoever arising out of or in connection with this
Lease, the relationship of Landlord and Tenant or Tenant's use of the
Premises. Any and all personal liability, if any, beyond that which may
be asserted under this paragraph, is expressly waived and released by
Tenant and by all persons claiming by, through or under Tenant.
4.28 INTENTIONALLY OMITTED.
4.29 MECHANIC'S LIENS AND TENANT'S PERSONAL PROPERTY TAXES.
4.29.1 MECHANIC'S LIENS. Tenant shall have no authority, express
or implied, to create or place any lien or encumbrance of any
kind or nature whatsoever upon, or in any manner to bind, the
interest of Landlord or Tenant in the Premises or to charge the
rentals payable under this Lease for any Claims in favor of any
person dealing with Tenant, including those who may furnish
materials or perform labor for any construction or repairs.
Tenant shall pay or cause to be paid all sums legally due and
payable by it on account of any labor performed or materials
furnished in connection with any work performed on the Premises
on which any lien is or can be validly and legally asserted
against its leasehold Interest in the Premises and Tenant shall
indemnify, defend and hold harmless Landlord from any and all
Claims arising out of any such asserted Claims. Tenant agrees to
give Landlord immediate written notice of any such Claim. Tenant
shall notify Landlord in writing at least ten (10) Business Days
in advance of any work to be done on, in, or about the Premises.
In the event of such scheduled work, whether Landlord received
notice from Tenant or not, Landlord shall have the right, at any
time and from time to time, to enter the Premises to post
notices of non-responsibility in such locations as Landlord
deems appropriate. Notwithstanding anything in this Lease to the
contrary, Landlord shall not be required to notify Tenant in
advance of entering the Premises for the purpose of posting the
notices of non-responsibility.
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4.29.2 PERSONAL PROPERTY TAXES. Tenant shall be liable for all
taxes levied or assessed against personal property, furniture or
fixtures placed by Tenant in the Premises. If any such taxes for
which Tenant is liable are levied or assessed against Landlord
or Landlord's property and Landlord elects to pay them or if the
assessed value of Landlord's property is increased by inclusion
of such personal property, furniture or fixtures and Landlord
elects to pay the taxes based on such increase, Tenant shall
reimburse Landlord for the sums so paid by Landlord, upon demand
by Landlord.
4.30 LANDLORD'S SECURITY INTEREST. In addition to any statutory lien for
rent in Landlord's favor, Landlord shall have and Tenant hereby grants
to Landlord a continuing security interest for all Base Rent,
Additional Rent and other sums becoming due under this Lease from
Tenant, upon all goods, wares, equipment, fixtures, furniture,
inventory, accounts, intangibles, chattel paper and other personal
property of Tenant situated in the Premises, and such property shall
not be removed therefrom without the consent of Landlord until all
arrearages in Base Rent, Additional Rent and other sums due under this
Lease shall first have been paid and discharged. On the occurrence of
an Event of Default, Landlord shall have, in addition to any other
remedies provided herein or by law, all rights and remedies under the
Uniform Commercial Code, including, the right to sell the property
described in this paragraph at public or private sale upon five (5)
Business Days notice to Tenant. Tenant hereby agrees to execute such
financing statements and other instruments necessary or desirable in
Landlord's discretion to perfect the security interest hereby created
and shall deliver such financing statement to Landlord for filing with
the appropriate Secretary of State. Any statutory lien for rent is not
waived, and the express contractual lien granted in this paragraph
constitutes a security agreement and is in addition and supplementary
to such statutory lien.
SECTION 5: DEFAULT AND REMEDIES
5.1 EVENTS OF DEFAULT.
5.1.1 Events of Default. The occurrence of any one or more of the
following events shall constitute a material default and breach
of this Lease by Tenant ("Event of Default"):
(a) vacation or abandonment of all or any portion of the
Premises;
(b) failure by Tenant to make any payment of Base Rent,
Additional Rent or any other sum payable by Tenant under this
Lease within five (5) Business Days after written notice from
Landlord that the same is due;
(c) failure by Tenant to observe or perform any covenant or
condition of this Lease, other than the making of payments,
where such failure shall continue for a period of twenty (20)
Business Days after written notice from Landlord;
(d) (1) the making by Tenant of any general assignment or
general arrangement for the benefit of creditors; (2) the
filing by or against Tenant of a petition in bankruptcy,
including reorganization or arrangement, unless, in the case of
a petition filed against Tenant, unless the same is dismissed
within twenty (20) Business Days; (3) the appointment of a
trustee or receiver to take possession of substantially all of
Tenant's assets located in the Premises or of Tenant's interest
in this Lease; (4) any execution, levy, attachment or other
process of law against Tenant's interest in this Lease, unless
the same is dismissed within twenty (20) Business Days; (5)
adjudication that Tenant is bankrupt; (6) the making by Tenant
of a transfer in fraud of creditors; or (7) the failure of
Tenant to generally pay its debts as they become due;
(e) any information furnished by or on behalf of Tenant to
Landlord in connection with the entry of this Lease is
determined to have been materially false, misleading or
incomplete when made;
(f) any assignment, subletting or other transfer for which the
prior consent of Landlord is required under this Lease and has
not been obtained; or
(g) Tenant's failure to observe or perform according to the
provisions of Sections 4.18 or 4.24 within two (2) days after
written notice from Landlord that Tenant has failed to observe
or perform according to the same.
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5.1.2 NOTICE OF DEFAULT. When this Lease requires service of a
notice, that notice shall replace rather than supplement any
equivalent or similar statutory notice, including any notices
required by Code of Civil Procedure section 1161 or any similar
or successor statute. When a statute requires service of a
notice in a particular manner, service of that notice (or a
similar notice required by this Lease) in the manner required by
paragraph 6.1 shall replace and satisfy the statutory
service-of-notice procedures, including those required by Code
of Civil Procedure section 1162 or any similar or successor
statute.
5.1.3 NOTICE TO LANDLORD REGARDING TENANT DEFAULT. Tenant shall
notify Landlord promptly of any Event of Default or any facts,
conditions or events which, with the giving of notice or passage
of time or both, would constitute an Event of Default.
5.1.4 TREATMENT AS UNEXPIRED LEASE. If a petition in bankruptcy
is filed by or against Tenant, and if this Lease is treated as
an "unexpired lease" under applicable bankruptcy law in such
proceeding, then Tenant agrees that Tenant shall not attempt nor
cause any trustee to attempt to extend the applicable time
period within which this Lease must be assumed or rejected.
5.2 REMEDIES. If any Event of Default occurs, Landlord may at any time
after such occurrence, with or without notice or demand except as
stated in this paragraph, and without limiting Landlord in the exercise
of any right or remedy at law which Landlord may have by reason of such
Event of Default, exercise the rights and remedies, either singularly
or in combination, as are specified or described in the subparagraphs
of this paragraph. Landlord's duty to mitigate damages shall be as set
forth in applicable California law, and shall not be expanded in any
manner by any provision of this Lease.
5.2.1 REMEDIES: TERMINATION AND RECOVERY OF POSSESSION. Landlord
may terminate this Lease and recover possession of the Premises,
in which case Tenant shall immediately surrender possession of
the Premises to Landlord and, in addition to any other rights
and remedies Landlord may have at law and in equity, Landlord
shall have the following rights:
(a) To re-enter the Premises then or at any time thereafter and
remove all persons and property and possess the Premises,
without prejudice to any other remedies Landlord may have by
reason of Tenant's default or of such termination, and Tenant
shall have no further claim hereunder.
(b) To recover all damages incurred by Landlord by reason of the
default, including without limitation (i) the worth at the
time of the award of the payments, including interest, owed by
Tenant to Landlord under this Lease that were earned or accrued
but unpaid at the time of termination; (ii) the worth at the
time of the award of the amount by which the payments owed by
Tenant to Landlord under the Lease that would have been earned
or accrued after the date of termination until the time of the
award exceeds the amount of the loss of payments owed by Tenant
to Landlord under this Lease for the same period that Tenant
affirmatively proves could have been reasonably avoided; (iii)
the worth at the time of the award of the amount by which the
payments owed by Tenant to Landlord for the balance of the Term
after the time of the award exceeds the amount of the loss of
payments owed by Tenant for the same period that Tenant proves
could have been reasonably avoided; (iv) all costs incurred by
Landlord in retaking possession of the Premises and restoring
them to good order and condition; (v) all costs, including
without limitation brokerage commissions, advertising costs and
restoration and remodeling costs, incurred by Landlord in
reletting the Premises; plus (vi) any other amount, including
without limitation attorneys' fees and audit expenses, necessary
to compensate Landlord for all detriment proximately caused by
Tenant's failure to perform its obligations under this Lease or
which in the ordinary course of things would be likely to result
therefrom. "The worth at the time of the award," as used in
clauses (i) and (ii) of this paragraph, is to be determined by
computing interest as to each unpaid payment owed by Tenant to
Landlord under the Lease, at the highest interest rate permitted
by law. "The worth at the time of the award," as referred to in
clause (iii) of this paragraph, is to be determined by
discounting such amount, as of the time of award, by the
discount rate of the Federal Reserve Bank at the time of the
award plus one percent (1%).
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(c) To remove, at Tenant's sole risk, any and all personal
property in the Premises and place such in a public or private
warehouse or elsewhere at the sole cost and expense and in the
name of Tenant. Any such warehouser shall have all of the rights
and remedies provided by law against Tenant as owner of such
property. If Tenant shall not pay the cost of such storage
within thirty (30) days following Landlord's demand, Landlord
may, subject to the provisions of applicable law, sell any or
all such property at a public or private sale in such manner and
at such times and places as Landlord deems proper, without
notice to or demand upon Tenant. Tenant waives all claims for
damages caused by Landlord's removal, storage or sale of the
property and shall indemnify and hold Landlord free and harmless
from and against any and all loss, cost and damage, including
without limitation court costs and attorneys' fees. Tenant
hereby irrevocably appoints Landlord as Tenant's
attorney-in-fact, coupled with an interest, with all rights and
powers necessary to effectuate the provisions of this
subparagraph 5.2.
5.2.2 REMEDIES: RECOVER RENT AS IT BECOMES DUE. Landlord may
elect, in its absolute discretion, to maintain Tenant's right to
possession, in which case this Lease shall continue in effect
whether or not Tenant shall have abandoned the Premises. In such
event, Landlord may enforce all of Landlord's rights and
remedies under this Lease, including the right to recover rent
as it becomes due hereunder, and, at Landlord's election, to
re-enter and relet the Premises on such terms and conditions as
Landlord deems appropriate. Without limiting the generality of
the foregoing, Landlord shall have the remedy described in
California Civil Code Section 1951.4 (lessor may continue lease
in effect after lessee's breach and abandonment and recover rent
as it becomes due, if lessee has right to sublet or assign,
subject only to reasonable limitations). Landlord may execute
any lease made pursuant hereto in its own name, and Tenant shall
have no right to collect any such rent or other proceeds.
Landlord's re-entry and/or reletting of the Premises, or any
other acts, shall not be deemed an acceptance of surrender of
the Premises or Tenant's interest therein, a termination of this
Lease or a waiver or release of Tenant's obligations hereunder.
Landlord shall have the same rights with respect to Tenant's
improvements and personal property as under Section 5.2.1 above,
even though such re-entry and/or reletling do not constitute
acceptance of surrender of the Premises or termination of this
Lease.
5.2.3 SUCCESSION TO TENANT RIGHTS. Whether or not Landlord
elects to terminate this Lease on account of any default by
Tenant, Landlord may:
(a) Terminate any sublease, license, concession, or other
consensual arrangement for possession entered into by Tenant and
affecting the Premises.
(b) Choose to succeed to Tenant's interest in such an
arrangement. If Landlord elects to succeed to Tenant's interest
in such an arrangement, Tenant shall, as of the date of notice
by Landlord of that election, have no further right to or
interest in, the rent or other consideration receivable under
that arrangement.
5.2.4 RIGHTS AND REMEDIES CUMULATIVE. None of the foregoing
remedial actions, singly or in combination, shall be construed
as an election by Landlord to terminate this Lease unless
Landlord has in fact given Tenant written notice that this Lease
is terminated; an act by Landlord to maintain or preserve the
Premises; any efforts by Landlord to relet the Premises; any
repairs or alterations made by Landlord to the Premises;
re-entry, repossession or reletting of the Premises by Landlord
pursuant to this paragraph; or the appointment of a receiver,
upon the initiative of Landlord, to protect Landlord's interest
under this Lease. If Landlord takes any of the foregoing
remedial action without terminating this Lease, Landlord may
nevertheless at any time after taking any such remedial action
terminate this Lease by written notice to Tenant.
5.2.5 MONEY DAMAGES UPON RELETTING. If Landlord relets the
Premises, Landlord shall apply the revenue from such reletting
as follows: FIRST, to the payment of any indebtedness other than
Base Rent, Additional Rent or any other sums payable under this
Lease by Tenant to Landlord; SECOND, to the payment of any cost
of reletting (including finders' fees and leasing commissions);
THIRD, to the payment of the cost of any alterations,
improvements,
27
maintenance and repairs to the Premises; and FOURTH, to the
payment of Base Rent, Additional Rent and other sums due and
payable and unpaid under this Lease. Landlord shall hold and
apply the residue, if any, to payment of future Base Rent,
Additional Rent and other sums payable under this Lease as the
same become due, and shall deliver the eventual balance, if any,
to Tenant. Should revenue from letting during any month, after
application pursuant to the foregoing provisions, be less than
the sum of the Base Rent, Additional Rent and other sums payable
under this Lease and Landlord's expenditures for the Premises
during such month. Tenant shall be obligated to pay such
deficiency to Landlord as and when such deficiency arises.
5.2.6 REMEDIES NONEXCLUSIVE. Pursuit of any of the foregoing
remedies shall not preclude Landlord's pursuit of any of the
other remedies provided in this Lease or by law (all such
remedies being cumulative), nor shall pursuit by Landlord of any
remedy provided in this Lease constitute a forfeiture or waiver
of any Base Rent, Additional Rent or other sum payable under
this Lease or of any damages accruing to Landlord by reason of
the violation of any of the covenants or conditions contained in
this Lease.
5.3 RIGHT TO PERFORM. If Tenant shall fail to pay any sum of money, other
than Base Rent or Additional Rent, required to be paid by it under this
Lease or shall fail to perform any other act on its part to be
performed under this Lease, and such failure shall continue for ten
(10) Business Days after notice of such failure by Landlord, or such
shorter time if reasonable under the circumstances, Landlord may, but
shall not be obligated to, and without waiving or releasing Tenant from
any obligations of Tenant, make such payment or perform such other act
on Tenant's part to be made or performed as provided in this Lease.
Landlord shall have (in addition to any other right or remedy of
Landlord) the same rights and remedies in the event of the nonpayment
of sums due under this paragraph as in the case of default by Tenant in
the payment of Base Rent.
5.4 LANDLORD'S DEFAULT. Landlord shall not be in default under this Lease
unless Landlord fails to perform obligations required of Landlord
within twenty (20) Business Days after written notice is delivered by
Tenant to Landlord and to the holder of any mortgages or deeds of trust
(collectively, "LENDER") covering the Premises whose name and address
shall have theretofore been furnished to Tenant in writing, specifying
the obligation which Landlord has failed to perform; provided, however,
that if the nature of Landlord's obligation is such that more than
twenty (20) Business Days are required for performance, then Landlord
shall not be in default if Landlord or Lender commences performance
within such twenty (20) Business Day period and thereafter diligently
prosecutes the same to completion. All obligations of Landlord
hereunder shall be construed as covenants, not conditions. In the event
of any default, breach or violation of Tenant's rights under this Lease
by Landlord, Tenant's exclusive remedies shall be an action for
specific performance or an action for actual damages. Tenant hereby
waives the benefit of any laws granting it the right to perform
Landlord's obligation, a lien upon the property of Landlord and/or upon
rent due Landlord, or the right to terminate this Lease or withhold
rent or any other amounts due hereunder on account of any Landlord
default.
5.5 ACCEPTANCE OF RENT WITHOUT WAIVING RIGHTS. Under the paragraph
captioned "NO WAIVER OF REMEDIES", Landlord may accept Tenant's
payments without waiving any rights under this Lease, including rights
under a previously served notice of default. If Landlord accepts
partial payments which cumulatively are less than the sum owed after
serving a notice of default, Landlord may nevertheless commence and
pursue an action to enforce rights and remedies under the previously
serviced notice of default without giving Tenant any further notice or
demand.
SECTION 6: MISCELLANEOUS PROVISIONS
6.1 NOTICES. Any notice, approval, consent, request or written
communication required or permitted to be delivered under this Lease
shall be: (a) in writing; (b) transmitted by personal delivery, express
or courier service, United States Postal Service in the manner
described below; and (c) deemed to be delivered on the earlier of the
date received or four (4) Business Days after having been deposited in
the United States Postal Service, postage prepaid. Such writings shall
be addressed to Landlord or Tenant, as the case may be, at the
respective designated addresses set forth
28
opposite their signatures, or at such other address(es) as they may,
after the execution date of this Lease, specify by written notice
delivered in accordance with this paragraph, with copies to the persons
at the addresses, if any, designated opposite each party's signature.
Those notices which contain a notice of breach or default or a demand
for performance may be sent by any of the methods described in clause
(b) above, but if transmitted by personal delivery or electronic means,
shall also be sent concurrently by certified or registered mail, return
receipt requested.
6.2 ATTORNEY'S FEES AND EXPENSES. In the event either party requires the
services of an attorney in connection with enforcing the terms of this
Lease, or in the event suit is brought for the recovery of Base Rent,
Additional Rent or any other sums payable under this Lease or for the
breach of any covenant or condition of this Lease, or for the
restitution of the Premises to Landlord or the eviction of Tenant
during the Lease Term or after the expiration or earlier termination of
this Lease, the prevailing party shall be entitled to a reasonable sum
for attorney's and paralegal's fees incurred at the trial or appellate
levels and for all costs and expenses associated with such levels. The
prevailing party shall be determined under Civil Code section
1717(b)(1) or any successor statute.
6.3 NO ACCORD AND SATISFACTION. No payment by Tenant or receipt by Landlord
of an amount less than the Base Rent or Additional Rent or any other
sum due and payable under this Lease shall be deemed to be other than a
payment on account of the Base Rent, Additional Rent or other such sum,
nor shall any endorsement or statement on any check or any letter
accompanying any check or payment be deemed an accord and satisfaction,
nor preclude Landlord's right to recover the balance of any amount
payable or Landlord's right to pursue any other remedy provided in this
Lease or at law.
6.4 SUCCESSORS: JOINT AND SEVERAL LIABILITY. Except as provided in the
paragraph captioned "EXCULPATION AND LIMITATION OF LIABILITY" and
subject to the paragraph captioned "ASSIGNMENT AND SUBLETTING BY
LANDLORD," all of the covenants and conditions contained in this
Lease shall apply to and be binding upon Landlord and Tenant and their
respective heirs, executors, administrators, successors and
assigns. In the event that more than one person, partnership, company,
corporation or other entity is included in the term "Tenant," then each
such person, partnership, company, corporation or other entity shall
be jointly and severally liable for all obligations of Tenant under
this Lease.
6.5 CHOICE OF LAW. This Lease shall be construed and governed by the laws
of the state of California. Tenant consents to Landlord's venue in
Orange County, California for any legal proceeding brought by Landlord
or Tenant to enforce the terms of this Lease.
6.6 NO WAIVER OF REMEDIES. The waiver by Landlord or Tenant of any covenant
or condition contained in this Lease shall not be deemed to be a waiver
of any subsequent breach of such covenant or condition nor shall any
custom or practice which may develop between the parties in the
administration of this Lease be construed to waive or lessen the rights
of Landlord or Tenant to insist on the strict performance by the other
party of all of the covenants and conditions of this Lease. No act or
thing done by Landlord or Landlord's Agents during the Lease Term shall
be deemed an acceptance or a surrender of the Premises, and no
agreement to accept a surrender of the Premises shall be valid unless
made in writing and signed by Landlord. The mention in this Lease of
any particular remedy shall not preclude Landlord from any other remedy
it might have, either under this Lease or at law, nor shall the waiver
of or redress for any violation of any covenant or condition in this
Lease or in any of the rules or regulations attached to this Lease or
later adopted by Landlord, prevent a subsequent act, which would have
originally constituted a violation, from having all the force and
effect of an original violation. The receipt by Landlord of Base Rent,
Additional Rent or any other sum payable under this Lease with
knowledge of a breach of any covenant or condition in this Lease shall
not be deemed a waiver of such breach. The failure of Landlord to
enforce any of the rules and regulations attached to this Lease or
later adopted, against Tenant or any other tenant in the Project, shall
not be deemed a waiver. Any waiver by Landlord or Tenant, as the case
may be, must be in writing and signed by Landlord or Tenant, as the
case may be, to be effective.
6.7 OFFER TO LEASE. The submission of this Lease to Tenant or its broker or
other agent does not constitute an offer to Tenant to lease the
Premises. This Lease shall have no force or effect until: (a) it is
executed and delivered by Tenant to Landlord; and (b) it is executed
and delivered by Landlord to Tenant.
29
6.8 FORCE MAJEURE. Except for monetary obligations (including, without
limitation, Tenant's obligations to pay Base Rent, Additional Rent and
all other charges due under this Lease), in the event that Landlord or
Tenant shall be delayed, hindered in or prevented from the performance
of any act or obligation required under this Lease by reason of acts of
God, strikes, lockouts, labor troubles or disputes, inability to
procure or shortage of materials or labor, failure of power or
utilities, delay in transportation, fire, vandalism, accident, flood,
severe weather, other casualty, Governmental Requirements, riot,
insurrection, civil commotion, sabotage, explosion, war, natural or
local emergency, acts or omissions of others, including the other party
hereto, or other reasons of a similar or dissimilar nature not solely
the fault of, or under the exclusive control of, Landlord or Tenant, as
applicable, then performance of such act shall be excused for the
period of the delay and the period for the performance of any such act
shall be extended for the period equivalent to the period of such
delay.
6.9 LANDLORD'S CONSENT. Unless otherwise provided in this Lease, whenever
Landlord's consent, approval or other action is required under the
terms of this Lease, such consent, approval or action shall be subject
to Landlord's judgment or discretion exercised in good faith and shall
be delivered in writing.
6.10 SEVERABILITY: CAPTIONS. If any clause or provision of this Lease is
determined to be illegal, invalid, or unenforceable under present or
future laws, the remainder of this Lease shall not be affected by such
determination, and in lieu of each clause or provision that is
determined to be illegal, invalid or unenforceable, there be added as a
part of this Lease a clause or provision as similar in terms to such
illegal, invalid or unenforceable clause or provision as may be
possible and be legal, valid and enforceable. Headings or captions in
this Lease are added as a matter of convenience only and in no way
define, limit or otherwise affect the construction or interpretation of
this Lease.
6.11 INTERPRETATION. Whenever a provision of this Lease uses the term (a)
"include" or "including", that term shall not be limiting but shall be
construed as illustrative, (b) "covenant," that term shall include any
covenant, agreement, term or provision, and (c) "at law," that term
shall mean at law or in equity, or both. This Lease shall be given a
fair and reasonable interpretation of the words contained in it without
any weight being given to whether a provision was drafted by one party
or its counsel.
6.12 INCORPORATION OF PRIOR AGREEMENTS: AMENDMENTS. This Lease contains all
of the agreements of the parties to this Lease with respect to any
matter covered or mentioned in this Lease, and no prior agreement or
understanding pertaining to any such matter shall be effective for any
purpose. No provision of this Lease may be amended or added to except
by an agreement in writing signed by the parties to this Lease or their
respective successors in interest.
6.13 AUTHORITY. If Tenant is a partnership, company, corporation or other
entity, each individual executing this Lease on behalf of Tenant
represents and warrants to Landlord that he or she is duly authorized
to so execute and deliver this Lease and that all partnership, company,
corporation or other entity actions and consents required for execution
of this Lease have been given, granted or obtained. If Tenant is a
partnership, company, corporation or other business organization, it
shall, within ten (10) Business Days after demand by Landlord, deliver
to Landlord satisfactory evidence of the due authorization of this
Lease and the authority of the person executing this Lease on its
behalf.
6.14 TIME OF ESSENCE. Time is of the essence with respect to the
performance of every covenant and condition of this Lease.
6.15 SURVIVAL OF OBLIGATIONS. Notwithstanding anything contained in this
Lease to the contrary or the expiration or earlier termination of this
Lease, any and all obligations of either party accruing prior to the
expiration or termination of this Lease shall survive the expiration or
earlier termination of this Lease, and either party shall promptly
perform all such obligations whether or not this Lease has expired or
terminated. Such obligations shall include any and all indemnity
obligations set forth in this Lease.
6.16 CONSENT TO SERVICE. Tenant irrevocably consents to the service of
process of any action or proceeding at the address of the Premises.
Nothing in this paragraph shall affect the right to serve process in
any other manner permitted by law.
6.17 LANDLORD'S AUTHORIZED AGENTS. Notwithstanding anything contained in the
Lease to the contrary,
30
including without limitation, the definition of Landlord's Agents, only
officers of Xxxxx Bank N.A., are authorized to amend, renew or
terminate this Lease, or to compromise any of Landlord's claims under
this Lease or to bind Landlord in any manner. Without limiting the
effect of the previous sentence, no property manager or broker shall be
considered an authorized agent of Landlord to amend, renew or terminate
this Lease or to compromise any of Landlord's claims under this Lease
or to bind Landlord in any manner.
6.18 EDISON LICENSE. Notwithstanding anything to the contrary set forth in
this Lease, Tenant acknowledges that pursuant to that certain license
agreement affecting the Project (the Edison License") entered into by
and between Southern California Edison Company ("Edision") and
Landlord's affiliate, South of Edison, LLC (a preliminary draft of
which Tenant acknowledges as having been received by Tenant), certain
payments will be made by Landlord to Edison in consideration of the
Project owner's right to build along Edison's right of way at the
Project. Tenant hereby agrees to comply with the terms and conditions
of the Edison License to the extent they apply to areas covered by the
terms of this Lease. Tenant further agrees that, notwithstanding
anything to the contrary contained in this Lease, all payments and
other charges under the Edison License shall be included as part of
Operating Costs for the Building.
[Remainder of Page Intentionally Left Blank]
31
6.19 WAIVER OF JURY TRIAL. LANDLORD AND TENANT BY PLACING THEIR INITIALS AT
THE END OF THIS PARAGRAPH HEREBY IRREVOCABLY WAIVE THEIR RESPECTIVE
RIGHTS TO TRIAL BY JURY OF ANY CONTRACT OR TORT CLAIM, COUNTERCLAIM,
CROSS-COMPLAINT, OR CAUSE OF ACTION IN ANY ACTION, PROCEEDING,
COUNTERCLAIM, OR HEARING BROUGHT BY EITHER PARTY AGAINST THE OTHER ON
ANY MATTER ARISING OUT OF OR RELATING IN ANY WAY TO THIS LEASE, THE
RELATIONSHIP OF LANDLORD AND TENANT, OR TENANT'S USE OR OCCUPANCY OF
THE PREMISES, INCLUDING ANY CLAIM OF INJURY OR DAMAGE OR THE
ENFORCEMENT OF ANY REMEDY UNDER ANY CURRENT OR FUTURE LAW, STATUTE,
REGULATION, CODE OR ORDINANCE.
[Landlord's Initials]: [Tenant's Initials]: /s/ JEK
---------- ----------
IN WITNESS WHEREOF, this Lease has been executed the day and year first
above set forth.
DESIGNATED ADDRESS FOR LANDLORD LANDLORD
Haven Gateway LLC HAVEN GATEWAY LLC, a Delaware limited liability
c/x Xxxxx & Company, company
a Division of Xxxxx Bank, N.A.
000 00xx Xxxxxx X.X. By: Xxxxx & Company, a division of Xxxxx Bank
Washington D.C. 20006 N.A., as Trustee of the Multi-Employer
Attn: Senior Asset Manager Property Trust, Its Sole Member
Voice: 000-000-0000
Facsimile: 000-000-0000
By:
-----------------------
Name:
---------------------
Its:
----------------------
WITH COPY TO MANAGER:
Investment Development Services, Inc.
Attn: Property Management
000 Xxxx Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Voice: 213-362-9300
Facsimile: 000-000-0000
DESIGNATED ADDRESS FOR TENANT: TENANT:
The Premises. OAKLEY, INC., a Washington corporation
By: /s/ Xxx X. Xxxxxx
----------------------------------
Name: XXX X. XXXXXX
--------------------------------
Its: VICE PRESIDENT OF OPERATIONS
---------------------------------
By: /s/ Xxxxxx Xxxxxx
----------------------------------
Name: XXXXXX X. XXXXXX
--------------------------------
Its: CFO
---------------------------------
32
LANDLORD ACKNOWLEDGMENT
)
DISTRICT OF COLUMBIA )ss.
)
On this _______ day of _________________, 200___, before me personally
appeared __________________________, to me known to be a
_____________________________ of Xxxxx & Company, a division of Xxxxx Bank N.A.,
the Trustee of the Multi-Employer Property Trust, the national banking
association that executed the within and foregoing instrument, and acknowledged
said instrument to be the free and voluntary act and deed of said national
banking association as trustee, for the uses and purposes therein mentioned, and
on oath stated that ____________ was authorized to execute said instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year first above written.
------------------------------------------------------
Name:
-------------------------------------------------
NOTARY PUBLIC in and for the District of Columbia,
residing at . My appointment
-----------------------
expires: .
---------------------------
33
[COMPLETE APPROPRIATE ACKNOWLEDGMENT FOR TENANT]
TENANT ACKNOWLEDGMENT (INDIVIDUAL)
__________________________ )
)ss.
__________________________ )
On this _____ day of __________,200___, before me, a Notary Public in
and for the _____________________ of ______________________, personally appeared
_______________________, to me known to be the individual(s) described in and
who executed the within and foregoing instrument, and acknowledged that
s/he/they signed the same as his/her/their free and voluntary act and deed, for
the uses and purposes therein mentioned.
WITNESS my hand and official seal hereto affixed the day and year first
as above written.
------------------------------------------------------
Name:
-------------------------------------------------
NOTARY PUBLIC in and for the District of Columbia,
residing at . My appointment
-----------------------
expires: .
---------------------------
[NOTARIAL SEAL]
34
TENANT ACKNOWLEDGMENT (PARTNERSHIP)
__________________________ )
)ss.
__________________________ )
On this _____ day of __________ 200___, before me, a Notary Public in
and for the _____________________ of __________________, personally appeared
_______________________________, the ___________________________________of
________________________________________, a ___________________________________
partnership, the partnership that executed the within and foregoing instrument,
and acknowledged said instrument to be the free and voluntary act and deed of
said partnership for the uses and purposes therein mentioned, and on oath stated
that s/he/they was/were authorized to execute said instrument.
WITNESS my hand and official seal hereto affixed the day and year first
as above written.
------------------------------------------------------
Name:
-------------------------------------------------
NOTARY PUBLIC in and for the District of Columbia,
residing at . My appointment
-----------------------
expires: .
---------------------------
[NOTARIAL SEAL]
36
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
State of California )
County of Orange )ss.
----------------)
On November 10, 2000 before me, /s/ Xxxx Xxxxxxxx, Notary Public ,
----------------- -----------------------------------------------
Name and Title of Officer (e.g.,"Xxxx Xxx,
Notary Public")
personally appeared /s/ Xxx Xxxxxx and Xxx Xxxxxx ,
----------------------------------------------------------
Name(s) of Signer(s)
/X/ personally known to me
/ / proved to me on the basis of satisfactory evidence
to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they
[NOTARIAL SEAL] executed the same in his/her/their authorized
capacity(ies), and that by his/her/their signature(s) on
the instrument the person(s), or the entity upon behalf of
which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
/s/ Xxxx Xxxxxxxx
-----------------------------------------------------------
Signature of Notary Public
Place Notary Seal Above
------------------------------------OPTIONAL------------------------------------
THOUGH THE INFORMATION BELOW IS NOT REQUIRED BY LAW, IT MAY PROVE VALUABLE TO
PERSONS RELYING ON THE DOCUMENT AND COULD PREVENT FRAUDULENT REMOVAL AND
REATTACHMENT OF THIS FORM TO ANOTHER DOCUMENT.
DESCRIPTION OF ATTACHED DOCUMENT
Title or Type of Document:
------------------------------------------------------
Document Date: Number of Pages:
---------------------------------- -------------
Signer(s) Other Than Named Above:
-----------------------------------------------
CAPACITY(IES) CLAIMED BY SIGNER
Signer's Name:
------------------------------------ RIGHT THUMBPRINT
/ / Individual OF SIGNER
/ / Corporate Officer - Title(s):_________________ Top of thumb here
/ / Partner - / / Limited / / General
/ / Attorney in Fact
/ / Trustee
/ / Guardian or Conservator
/ / Other:
----------------------------------------
Signer Is Representing:
---------------------------------------------------------
TENANT ACKNOWLEDGMENT (CORPORATION)
__________________________ )
)ss.
__________________________ )
On this _____ day of ___________,200___, before me, a Notary Public in
and for the _____________________________________, personally appeared
_______________________, the ________________________________________ of
____________________________________________, the ______________________________
corporation that executed the within and foregoing instrument, and acknowledged
said instrument to be the free and voluntary act and deed of said corporation
for the uses and purposes therein mentioned, and on oath stated that s/he/they
was/were authorized to execute said instrument.
WITNESS my hand and official seal hereto affixed the day and year first
as above written.
------------------------------------------------------
Name:
-------------------------------------------------
NOTARY PUBLIC in and for the State of California,
residing at . My appointment
-----------------------
expires: .
---------------------------
[NOTARIAL SEAL]
36
EXHIBIT A to Lease
LEGAL DESCRIPTION OF LAND
Ex. A
1
EXHIBIT "B"
[GRAPHIC]
XXXX XXXX
XXXXXXXX 0
XXXXX XXXXXXX XXXXXXXX XXXX
in ONTARIO, CALIFORNIA
-------------------------------
INVESTMENT DEVELOPMENT SERVICES
EXHIBIT C to Lease
WORK LETTER AND CONSTRUCTION AGREEMENT
This Work Letter and Construction Agreement ("Work Letter") shall set
forth the terms and conditions relating to the construction of the Premises.
This Work Letter is essentially organized chronologically and addresses the
issues of the construction of the PrEmises, in sequence, as such issues will
arise during the actual construction of the Premises. All references in this
Work Letter to Articles or Sections of "this Lease" shall mean the relevant
portions of the Lease to which this Work Letter is attached as EXHIBIT C, and
all references in this Work Letter to Sections of "this Work Letter" shall mean
the relevant portions of this Work Letter. All general contractors and all
subcontractors in connection with the Tenant Improvements shall satisfy those
union labor requirements set forth in the Lease in the paragraph captioned
"TENANT'S WORK PERFORMANCE"; provided however, that with respect to the
installation in the Premises of Tenant's racking and conveyors, if union labor
is not available to perform the installation of such trade fixtures, Tenant may
utilize the services of any other qualified sub-contractors which normally and
regularly perform similar work in similar industrial buildings and who are
reasonably approved by Landlord in writing in accordance with Section 4.1.2
below. The Tenant Improvement Allowance and Excess Allowance may only be used
for items of general construction to be permanently affixed to the Premises, but
not personal property or trade fixtures.
SECTION 1
DELIVERY OF THE PREMISES AND BASE BUILDING
Upon the full execution and delivery of this Lease by Landlord and
Tenant, Landlord shall deliver the Premises and "Base Building", as that term is
defined below, to Tenant, and Tenant shall accept the Premises and Base Building
from Landlord in their presently existing "as-is" condition. The "Base Building"
shall consist of those portions of the Premises which were in existence prior to
the construction of tenant improvements in the Premises.
SECTION 2
TENANT IMPROVEMENTS
2.1 TENANT IMPROVEMENT ALLOWANCE. (a) Tenant shall be entitled to a
one-time tenant improvement allowance ("Tenant Improvement Allowance") in the
amount of Two Hundred Seven Thousand Nine Hundred and 00/100 Dollars
($207,900.00), for the cost relating to the initial design and the actual cost
of constructing the Tenant's improvements, which are permanently affixed to the
Premises ("Tenant Improvements"). Except as set forth below, in no event shall
Landlord be obligated to make disbursements pursuant to this Tenant Work Letter
in a total amount which exceeds the Tenant Improvement Allowance.
(b) If the cost of the Tenant Improvements is budgeted to exceed the
Tenant Improvement Allowance, Tenant may request in writing, within thirty (30)
days after the date of the Lease, that Landlord pay up to an additional Two
Hundred Seven Thousand Nine Hundred arid 00/100 Dollars ($207,900.00) (the
"Excess Allowance") to be utilized solely for the construction of the Tenant
Improvements. Tenant shall repay the Excess Allowance to Landlord as follows:
concurrently with its payments to Landlord of monthly Base Rent, Tenant shall
pay the amounts necessary to fully amortize the Excess Allowance over the
initial Lease Term, together with interest at the rate of eleven percent (11%)
per annum, with such amortized payments being due and payable by Tenant monthly
(together with Base Rent) commencing on the Commencement Date and continuing
through the expiration of the initial Lease Term. If the Lease is canceled or
terminated for any reason prior to the expiration of the full initial term, then
the unamortized Excess Allowance shall become immediately due and payable to
Landlord. If Tenant timely requests the Excess Allowance, then the Excess
Allowance shall be deemed part of the Tenant Improvement Allowance
EX. C
1
for purposes of this Work Letter Agreement. Upon Landlord's demand, Tenant shall
execute an amendment to the Lease, on Landlord's form, to reflect the additional
rent.
2.2 DISBURSEMENT OF THE TENANT IMPROVEMENT ALLOWANCE
2.2.1 TENANT IMPROVEMENT ALLOWANCE ITEMS. Except as
otherwise set forth in this Tenant Work Letter, the Tenant Improvement Allowance
shall be disbursed by Landlord only for the following items and costs
(collectively the "Tenant Improvement Allowance Items"):
2.2.1.1 Notwithstanding anything to the contrary set forth
herein, costs for the payment of the fees of the "Architect" and the
"Engineers," as those terms are defined in SECTION 3.1 of this Tenant Work
Letter, shall not exceed an aggregate amount equal to $3.50 for each usable
square foot of space in the Premises;
2.2.1.2 The payment of plan check, permit and license fees
relating to construction of the Tenant Improvements;
2.2.1.3 The cost of construction of the Tenant Improvements,
including, without limitation, testing and inspection costs and trash removal
costs, and contractors' fees and general conditions;
2.2.1.4 The cost of any changes in the Base Building when such
changes are required by the Construction Drawings (including if such changes are
due to the fact that such work is prepared on an unoccupied basis), such cost to
include all direct architectural and/or engineering fees and expenses incurred
in connection therewith;
2.2.1.5 The cost of any changes to the Construction Drawings
or Tenant Improvements required by Code;
2.2.1.6 Sales and use taxes and Title 24 fees; and
2.2.1.7 Payment to Landlord of a construction supervisor fee
equal to three percent (3%) of the construction costs of the Tenant Improvements
covered by the Tenant Improvement Allowance.
2.2.1.8 All other costs to be expended by Tenant and
reasonably approved Landlord in connection with the construction of the Tenant
Improvements.
2.2.2 DISBURSEMENT OF TENANT IMPROVEMENT ALLOWANCE. During the
construction of the Tenant Improvements, Landlord shall make monthly
disbursements of the Tenant Improvement Allowance for Tenant Improvement
Allowance Items for the benefit of Tenant and shall authorize the release of
monies for the benefit of Tenant as follows:
2.2.2.1 MONTHLY DISBURSEMENTS. On or before the twenty-fifth
(25th) day of each calendar month, during the construction of the Tenant
Improvements, Tenant shall deliver to Landlord: (i) a request for payment of the
"Contractor," as that term is defined in SECTION 4.1 of this Tenant Work Letter,
approved by Tenant, in a form to be provided by Landlord, showing the schedule,
by trade, of percentage of completion of the Tenant Improvements in the
Premises, detailing the portion of the work completed and the portion not
completed; (ii) invoices from all of "Tenant's Agents," as that term is defined
in SECTION 4.1.2 of this Tenant Work Letter, for labor rendered and materials
delivered to the Premises; (iii) executed mechanic's lien releases from all of
Tenant's Agents which shall comply with the appropriate provisions, as
reasonably determined by Landlord, of California Civil Code Section 3262(d); and
(iv) all other information reasonably requested by Landlord. Tenant's request
for payment shall be deemed Tenant's acceptance and approval of the work
furnished and/or the materials supplied as set forth in Tenant's payment
request. On or before the last day of the following month, Landlord shall
deliver a check to Tenant made jointly
Ex. C
2
payable to Contractor and Tenant in payment of the lesser of: (A) the amounts
so requested by Tenant, as set forth in this SECTION 2.2.2.1, above, less a
ten percent (10%) retention (the aggregate amount of such retentions to be
known as the "Final Retention"), and (B) the balance of any remaining
available portion of the Tenant Improvement Allowance (not including the
Final Retention), provided that Landlord does not dispute any request for
payment based on a non-compliance of any work with the "Approved Working
Drawings," as that term is defined in SECTION 3.4 below, or due to any
substandard work. Landlord's payment of such amounts shall not be deemed
Landlord's approval or acceptance of the work furnished or materials supplied
as set forth in Tenant's payment request.
2.2.2.2 FINAL RETENTION. Subject to the provisions of this
Tenant Work Letter, a check for the Final Retention payable jointly to Tenant
and Contractor shall be delivered by Landlord to Tenant following the completion
of construction of the Premises, provided that (i) Tenant delivers to Landlord a
waiver and release in accordance with the terms of California Civil Code Section
3262(d)(2) and a waiver and release in accordance with either California Civil
Code Section 3262(d)(3) or Section 3262(d)(4), (ii) Landlord has determined that
no substandard work exists which adversely affects the mechanical, electrical,
plumbing, heating, ventilating and air conditioning, life-safety or other
systems of the Project, the curtain wall of the Project, the structure or
exterior appearance of the Project, or any other tenant's use of such other
tenant's leased premises in the Project and (iii) Architect delivers to
Landlord a certificate, in a form reasonably acceptable to Landlord, certifying
that the construction of the Tenant Improvements in the Premises has been
substantially completed.
2.2.2.3 OTHER TERMS. Landlord shall only be obligated to make
disbursements from the Tenant Improvement Allowance to the extent costs are
incurred by Tenant for Tenant Improvement Allowance items. All Tenant
Improvement Allowance Items for which the Tenant Improvement Allowance has been
made available shall be deemed Landlord's property under the terms of this
Lease.
SECTION 3
CONSTRUCTION DRAWINGS
3.1 SELECTION OF ARCHITECT/CONSTRUCTION DRAWINGS. Tenant shall
retain an architect approved by Landlord (the "Architect") to prepare the
Construction Drawings. Tenant shall retain the engineering consultants
reasonably approved by Landlord (the "Engineers") to prepare all plans and
engineering working drawings relating to the structural, mechanical, electrical,
plumbing, HVAC, life-safety, and sprinkler work in the Premises, which work is
not part of the Bass Building. The plans and drawings to be prepared by
Architect and the Engineers hereunder shall be known collectively as the
"Construction Drawings". All Construction Drawings shall comply with the drawing
format and specifications acceptable to Landlord. Tenant and Architect shall
verify, in the field, the dimensions and conditions as shown on the relevant
portions of the base building plans, and Tenant and Architect shall be solely
responsible for the same, and Landlord shall have no responsibility in
connection therewith. Landlord's review of the Construction Drawings as set
forth In this SECTION 3, shall be for its sole purpose and shall not imply
Landlord's review of the same, or obligate Landlord to review the same, for
quality, design, Code compliance or other like matters. Accordingly,
notwithstanding that any Construction Drawings are reviewed by Landlord or its
space planner, architect, engineers and consultants, and notwithstanding any
advice or assistance which may be rendered to Tenant by Landlord or Landlord's
space planner, architect, engineers, and consultants, Landlord shall have no
liability whatsoever in connection therewith and shall not be responsible for
any omissions or errors contained in the Construction Drawings, and Tenant's
waiver and indemnity set forth in this Lease shall specifically apply to the
Construction Drawings.
3.2 APPROVED WORKING DRAWINGS. Landlord shall approve (or
disapprove) working drawings prepared by Architect within five (5) days after
Landlord receives the final Working Drawings (the "Approved Working Drawings").
Tenant shall submit the same to the City of Ontario and diligently pursue its
receipt of all applicable building permits. Tenant hereby agrees that neither
Landlord nor Landlord's consultants shall be responsible for obtaining any
building permit or certificate of occupancy for the Premises and that
EX. C
3
obtaining the same shall be Tenant's responsibility; provided, however, that
Landlord shall cooperate with Tenant in executing permit applications and
performing other ministerial acts reasonably necessary to enable Tenant to
obtain any such permit or certificate of occupancy. No changes, modifications or
alterations in the Approved Working Drawings may be made without the prior
written consent of Landlord, which consent may not be unreasonably withheld.
SECTION 4
CONSTRUCTION OF THE TENANT IMPROVEMENTS
4.1 TENANT'S SELECTION OF CONTRACTORS.
4.1.1 THE CONTRACTOR. A general contractor shall be retained
by Tenant to construct the Tenant Improvements and Tenant shall contract
directly with such "Contractor". Landlord may file a Notice of
Non-Responsibility regarding payments under Tenant's contract with the
Contractor. Such general contractor ("Contractor") shall be selected by Tenant
from a list of general contractors supplied by Tenant and reasonably approved by
Landlord.
4.1.2 TENANT'S AGENTS. All subcontractors, laborers,
materialmen, and suppliers used by Tenant (such subcontractors, laborers,
materialmen, and suppliers, and the Contractor to be known collectively as
"Tenant's Agents") must be approved in writing by Landlord, which approval shall
not be unreasonably withheld or delayed. If Landlord does not approve any of
Tenant's proposed subcontractors, laborers, materialmen or suppliers, Tenant
shall submit other proposed subcontractors, laborers, materialmen or suppliers
for Landlord's written approval.
4.2 CONSTRUCTION OF TENANT IMPROVEMENTS BY TENANT'S AGENCY.
4.2.1 CONSTRUCTION CONTRACTS COST BUDGET. Prior to Tenant's
execution of the construction contract and general conditions with Contractor
(the "Contract"), Tenant shall submit the Contract to Landlord for its approval
with regard to proper insurance and licensing requirements and any other areas
which may adversely affect Landlord's interest in the Project, and which
approval shall not be unreasonably withheld or delayed by more than five (5)
business days after Landlord's receipt of the Contract. Prior to the
commencement of the construction of the Tenant Improvements, and after Tenant
has accepted all bids for the Tenant Improvements, Tenant shall provide Landlord
with a detailed breakdown, by trade, of the final costs to be incurred or which
have been incurred in connection with the design and construction of the Tenant
Improvements to be performed by or at the direction of Tenant or the Contractor,
which costs form a basis for the amount of the Contract (the "Final Costs").
Prior to the commencement of construction of the Tenant Improvements, Tenant
shall supply Landlord with cash in an amount (the "Over-Allowanced Amount")
equal to the difference between the amount of the Final Costs and the amount
of the Tenant Improvement Allowance (less any portion thereof already disbursed
by Landlord, or in the process of being disbursed by Landlord, on or before the
commencement of construction of the Tenant Improvements). The Over-Allowance
Amount shall be disbursed by Landlord prior to the disbursement of any of the
then remaining portion of the Tenant Improvement Allowance, and such
disbursement shall be pursuant to the same procedure as the Tenant Improvement
Allowance. In the event that, after the Final Costs have been delivered by
Tenant to Landlord, the costs relating to the design and construction of the
Tenant Improvements shall change, any additional costs necessary to such design
and construction in excess of the Final Costs, shall be paid by Tenant to
Landlord immediately as an addition to the Over-Allowance Amount or at
Landlord's option. Tenant shall make payments for such additional costs out of
its own funds, but Tenant shall continue to provide Landlord with the documents
described in SECTION 2.2.2.1 (i), (ii), (iii) AND (iv) of this Tenant Work
Letter, above, for Landlord's approval, prior to Tenant paying such costs.
4.2.2 TENANT'S AGENTS.
Ex. C
4
4.2.2.1 LANDLORD'S GENERAL CONDITIONS FOR
TENANT'S AGENTS AND TENANT IMPROVEMENT WORK. Tenant's and Tenant's Agent's
construction of the Tenant Improvements shall comply with the following: (i) the
Tenant Improvements shall be constructed in strict accordance with the Approved
Working Drawings; (ii) Tenant's Agents shall submit schedules of all work
relating to the Tenant's Improvements to Contractor and Contractor shall, within
five (5) business days of receipt thereof, inform Tenant's Agents of any changes
which are necessary thereto, and Tenant's Agents shall adhere to such corrected
schedule; and (iii) Tenant shall abide by all rules made by Landlord's Project
manager with respect to the use of freight, loading dock and service elevators,
storage of materials, coordination of work with the contractors of other
tenants, and any other matter in connection with this Tenant Work Letter,
including, without limitation, the construction of the Tenant Improvements.
4.2.2.2 INDEMNITY. Tenant's indemnity of
Landlord as set forth in this Lease shall also apply with respect to any and all
costs, losses, damages, injuries and liabilities related in any way to any act
or omission of Tenant or Tenant's Agents, or anyone directly or indirectly
employed by any of them, or in connection with Tenant's non-payment of any
amount arising out of the Tenant Improvements and/or Tenant's disapproval of all
or any portion of any request for payment. Such indemnity by Tenant, as set
forth in this Lease, shall also apply with respect to any and all costs, losses,
damages, injuries and liabilities related in any way to Landlord's performance
of any ministerial acts reasonably necessary (i) to permit Tenant to complete
the Tenant Improvements, and (ii) to enable Tenant to obtain any Project permit
or certificate of occupancy for the Premises.
4.2.2.3 REQUIREMENTS OF TENANT'S AGENTS. Each of
Tenant's Agents shall guarantee to Tenant and for the benefit of Landlord that
the portion of the Tenant Improvements for which it is responsible shall be free
from any defects in workmanship and materials for a period of not less than one
(1) year from the date of completion thereof. Each of Tenant's Agents shall be
responsible for the replacement or repair, without additional charge, of all
work done or furnished in accordance with its contract that shall become
defective within one (1) year after the later to occur of (i) completion of the
work performed by such contractor or subcontractors and (ii) the Commencement
Date. The correction of such work shall include, without additional charge, all
additional expenses and damages incurred in connection with such removal or
replacement of all or any part of the Tenant Improvements, and/or the Project
and/or common areas that may be damaged or disturbed thereby. All such
warranties or guarantees as to materials or workmanship of or with respect to
the Tenant Improvements shall be contained in the Contract or subcontract and
shall be written such that such guarantees or warranties shall inure to the
benefit of both Landlord and Tenant, as their respective interests may appear,
and can be directly enforced by either. Tenant covenants to give to Landlord any
assignment or other assurances which maybe necessary to effect such right of
direct enforcement.
4.2.2.3.1 LIEN-FREE BASIS. Tenant's Contractor and
agents shall perform all work on a lien-free basis. If a lien is filed or
recorded against the Project due to, or in any way associated with, the
construction of the Tenant Improvements, Tenant agrees to have such lien
released of record (in a manner and form approved by Landlord) within five
(5) days of Landlord's notice to Tenant regarding same. If Tenant fails to
cause the release of such lien within such five (5) day period to Landlord's
satisfaction, Landlord may cause the removal of such lien, and Tenant agrees
to repay Landlord for all costs and expenses incurred by Landlord to release
the lien (including, but not limited to, the payment of the amount stated in
the lien, any filing, processing, recording and attorneys' fees) within ten
(10) days of Landlord's request therefor, and such amount shall be considered
Additional Rent due under the Lease. If Tenant falls to pay Landlord as
aforesaid, such failure shall be deemed an uncured noticed material default
under the Lease, and Landlord may pursue any remedy provided for under the
Lease, at law or in equity.
4.2.2.4 INSURANCE REQUIREMENTS
4.2.2.4.1 GENERAL COVERAGES. All of
Tenant's Agents shall carry worker's compensation insurance covering all of
their respective employees, and shall also carry public liability insurance,
including property damage, all with limits, in form and with companies as are
required to be
Ex. C
5
carried by Tenant as set forth in this Lease.
4.2.2.4.2 SPECIAL COVERAGES. Tenant shall carry
"Builder's All Risk" insurance in an amount approved by Landlord covering the
construction of the Tenant Improvements, and such other insurance as Landlord
may require, it being understood and agreed that the Tenant Improvements shall
be insured by Tenant pursuant to this Lease immediately upon completion thereof.
Such insurance shall be in amounts and shall include such extended coverage
endorsements as may be reasonably required by Landlord including, but not
limited to, the requirement that all of Tenant's Agents shall carry excess
liability and Products and Completed Operating Coverage insurance, each in
amounts not less than $500,000 for each incident, $1,000,000 in aggregate, and
in form and with companies as are required to be carried by Tenant as set forth
in this Lease.
4.2.2.4.3 GENERAL TERMS. Certificates for all insurance
carried pursuant to this SECTION 4.2.2.4 shall be delivered to Landlord before
the commencement of construction of the Tenant Improvements and before the
Contractor's equipment is moved onto the site. All such policies of insurance
must contain a provision that the company writing said policy will give Landlord
thirty (30) days prior written notice of any cancellation or lapse of the
effective date or any reduction in the amounts of such insurance. In the event
that the Tenant Improvements are damaged by any cause during the course of the
construction thereof, Tenant shall immediately repair the same at Tenant's sole
cost and expense. Tenant's Agents shall maintain all of the foregoing insurance
coverage in force until the Tenant Improvements are fully completed and accepted
by Landlord, except for any Products and Completed Operation Coverage insurance
required by Landlord, which is to be maintained for two (2) years following
completion of the work and acceptance by Landlord and Tenant. All policies
carried under this SECTION 4.2.2.4 shall insure Landlord and Tenant, as their
interests may appear, as well as Contractor and Tenant's Agents. All insurance,
except Workers' Compensation, maintained by Tenant's Agents shall preclude
subrogation claims by the insurer against anyone insured thereunder. Such
insurance shall provide that it is primary insurance as respects the owner and
that any other insurance maintained by owner is excess and noncontributing with
the insurance required hereunder. The requirements for the foregoing insurance
shall not derogate from the provisions for indemnification of Landlord by Tenant
under SECTION 4.2.2.2 of this Tenant Work Letter.
4.2.3 GOVERNMENTAL COMPLIANCE. The Tenant Improvements shall
comply in all respects with the following: (i) the Code and other state,
federal, city or quasi-governmental laws, codes, ordinances and regulations, as
each may apply according to the rulings of the controlling public official,
agent or other person; (ii) applicable standards of the American Insurance
Association (formerly, the National Board of Fire Underwriters) and the National
Electrical Code; and (iii) Project material manufacturer's specifications.
4.2.4 INSPECTION BY LANDLORD. Landlord shall have the right
to inspect the Tenant Improvements at all times, provided however, that
Landlord's failure to inspect the Tenant Improvements shall in no event
constitute a waiver of any of Landlord's rights hereunder nor shall Landlord's
inspection of the Tenant Improvements constitute Landlord's approval of the
same. Should Landlord disapprove any portion of the Tenant Improvements,
Landlord shall notify Tenant in writing of such disapproval and shall specify
the items disapproved. Any defects or deviations in, and/or disapproval by
Landlord of, the Tenant Improvements shall be rectified by Tenant at no expense
to Landlord, provided however, that in the event Landlord determines that a
defect or deviation exists or disapproves of any matter in connection with any
portion of the Tenant Improvements and such defect, deviation or matter might
adversely affect the mechanical, electrical, plumbing, heating, ventilating and
air conditioning or life-safety systems of the Project, the structure or
exterior appearance of the Project or any other tenant's use of such other
tenant's leased premises, Landlord may, take such action as Landlord deems
necessary, at Tenant's expense and without incurring any liability on Landlord's
part, to correct any such defect, deviation and/or matter, including, without
limitation, causing the cessation of performance of the construction of the
Tenant Improvements until such time as the defect, deviation and/or matter is
corrected to Landlord's satisfaction.
4.2.5 MEETINGS. Commencing upon the execution of this Lease,
Tenant and Landlord
Ex. C
6
shall hold meetings as required at a reasonable time, with the Architect and the
Contractor regarding the progress of the preparation of Construction Drawings
and the construction of the Tenant Improvements, which meetings shall be held at
a location designated by the partners, and Landlord and/or its agents shall
receive prior notice of, and shall have the right to attend, all such meetings,
and, upon Landlord's request, certain of Tenant's Agents shall attend such
meeting's One such meeting each month shall include the review of Contractor's
current request for payment.
4.3 NOTICE OF COMPLETION: COPY OF "AS BUILT" PLANS. Within ten (10)
days after completion of construction of the Tenant Improvements, Tenant shall
cause a Notice of Completion to be recorded in the office of the Recorder of the
County of Los Angeles in accordance with Section 3093 of the Civil Code of the
State of California or any successor statute, and shall furnish a copy thereof
to Landlord upon such recordation. If Tenant fails to do so, Landlord may
execute and file the same on behalf of Tenant as Tenant's agent for such
purpose, at Tenant's sole cost and expense. At the conclusion of construction,
(i) Tenant shall cause the Architect and Contractor (A) to update the Approved
Working Drawings as necessary to reflect all changes made to the Approved
Working Drawings during the course of construction, (B) to certify to the best
of their knowledge that the "record-set" of as-built drawings are true and
correct, which certification shall survive the expiration or termination of this
Lease, and (C) to deliver to Landlord two (2) sets of copies of such as-built
drawings within ninety (90) days following issuance of a certificate of
occupancy for the Premises, and (ii) Tenant shall deliver to Landlord a copy of
all warranties, guaranties, and operating manuals and information relating to
the improvements, equipment, and systems in the Premises.
SECTION 5
MISCELLANEOUS
5.1 TENANT'S REPRESENTATIVE. Tenant has designated Xxxx Xxxxxxxxx as
its sole representative with respect to the matters set forth in this Tenant
Work Letter, who shall have full authority and responsibility to act on behalf
of the Tenant as required in this Tenant Work Letter.
5.2 LANDLORD'S REPRESENTATIVE. Landlord shall designate an
individual as its sole representative with respect to the matters set forth in
this Tenant Work Letter, who, until further notice to Tenant, shall have full
authority and responsibility to act on behalf of the Landlord as required in
this Tenant Work Letter.
5.3 TIME OF THE ESSENCE IN THIS TENANT WORK LETTER. Unless otherwise
indicated, all references herein to a "number of days" shall mean and refer to
calendar days. If any item requiring approval is timely disapproved by Landlord,
the procedure for preparation of the document and approval thereof shall be
repeated until the document is approved by Landlord.
5.4 TENANT'S LEASE DEFAULT. Notwithstanding any provision to the
contrary contained in this Lease, if an event of default as described in the
Lease or this Tenant Work Letter has occurred at any time on or before the
substantial completion of the Premises, then (i) in addition to all other rights
and remedies granted to Landlord pursuant to this Lease, Landlord shall have the
right to withhold payment of all or any portion of the Tenant Improvement
Allowance and/or Landlord may cause Contractor to cease the construction of the
Premises (in which case, Tenant shall be responsible for any delay in the
substantial completion of the Premises caused by such work stoppage), and (ii)
all other obligations of Landlord under the terms of this Tenant Work Letter
shall be forgiven until such time as such default is cured pursuant to the terms
of this Lease (in which case, Tenant shall be responsible for any delay in the
substantial completion of the Premises caused by such inaction by Landlord).
5.6 CONSTRUCTION DEFECTS. Landlord shall have no responsibility for
the Tenant Improvements and Tenant will remedy, at Tenant's own expense, and be
responsible for any and all defects in the Tenant Improvements that may appear
during or after the completion thereof whether the same shall affect the Tenant
Improvements in particular or any parts of the Premises in general. Tenant shall
indemnify, hold
EX. C
7
harmless and reimburse Landlord for any costs or expenses incurred by Landlord
by reason of any defect in any portion of the Tenant Improvements constructed by
Tenant or Tenant's contractor or subcontractors, or by reason of inadequate
cleanup following completion of the Tenant Improvements.
5.7 COORDINATION OF LABOR. All of Tenant's contractors,
subcontractors, employees, servants and agents must work in harmony with and
shall not interfere with any labor employed by Landlord, or Landlord's
contractors or by any other tenant or its contractors with respect to any
portion of the Project.
5.8 WORK IN ADJACENT AREAS. Any work to be performed in areas
adjacent to the Premises shall be performed only after obtaining Landlord's
express written permission, and shall be done only if an agent or employee of
Landlord is present; Tenant will reimburse Landlord for the expense of any such
employee or agent.
5.9 HVAC SYSTEMS. Tenant agrees to be entirely responsible for the
maintenance or the balancing of any heating, ventilating or air conditioning
system installed by Tenant and/or maintenance of the electrical or plumbing work
installed by Tenant and/or for maintenance of lighting fixtures, partitions,
doors, hardware or any other installations made by Tenant.
5.10 APPROVAL OF PLANS. Landlord will not check Tenant drawings for
building code compliance. Approval of the Construction Drawings by Landlord is
not a representation that the drawings are in compliance with the requirements
of governing authorities, and it shall be Tenant's responsibility to meet and
comply with all federal, state, and local code requirements. Approval of the
Construction Drawings does not constitute assumption of responsibility by
Landlord or its architect for their accuracy, sufficiency or efficiency, and
Tenant shall be solely responsible for such matters.
5.11 BOOKS AND RECORD. At its option, Landlord, at any time within
three (3) years after final disbursement of the Tenant Improvement Allowance to
Tenant, and upon at least ten (10) days prior written notice to Tenant, may
cause an audit to be made of Tenant's books and records relating to Tenant's
expenditures in connection with the construction of the Tenant Improvements.
Tenant shall maintain complete and accurate books and records in accordance with
generally accepted accounting principles of these expenditures for at least
three (3) years. Tenant shall make available to Landlord's auditor at the
Premises within ten (10) business days following Landlord's notice requiring the
audit, all books and records maintained by Tenant pertaining to the construction
and completion of the Tenant Improvements. In addition to all other remedies
which Landlord may have pursuant to the Lease, Landlord may recover from Tenant
the reasonable cost of its audit if the audit discloses that Tenant falsely
reported to Landlord expenditures which were not in fact made or falsely
reported a material amount of any expenditure or the aggregate expenditures.
Ex. C
8
EXHIBIT D to Lease
FORM OF MEMORANDUM OF COMMENCEMENT DATE
Haven Gateway LLC, a Delaware limited liability company, as Landlord,
and ______________________________________________________ as Tenant, executed
that certain Lease dated as of ___________________________,200___ (the "Lease").
The Lease contemplates that upon satisfaction of certain conditions
Landlord and Tenant will agree and stipulate as to certain provisions of the
Lease. All such conditions precedent to that stipulation have been satisfied.
Landlord and Tenant agree as follows:
1. The Commencement Date at the Lease is__________________________.
2. The Termination Date of the Lease is __________________________.
3. The Premises consist of ___________________rentable square feet.
4. Base Rent is as follows:
_____________________ through ___________; $ _________ per month
_____________________ through ___________; $ _________ per month
_____________________ through ___________; $ _________ per month
_____________________ through ___________; $ _________ per month
5. Tenant's Pro Rata Share is ______________ percent (__________%).
IN WITNESS WHEREOF, the parties have caused this Memorandum to be duly executed
as of _______________________________,200__________.
LANDLORD: TENANT:
--------- -------
Haven Gateway, LLC, a Delaware limited liability ___________________________, a
company ______________________________
By: By:
---------------------------------- ---------------------------
Name: Name:
---------------------------------- ---------------------------
Its: Its:
---------------------------------- ---------------------------
EX.D
1
EXHIBIT E to Lease
RULES AND REGULATIONS
1. No sign, placard, picture, advertisement, name or notice shall
be installed or displayed on any part of the outside or inside of the Building
or Land without the prior written consent of the Landlord. Landlord shall have
the right to remove, at Tenant's expense and without notice, any sign installed
or displayed in violation of this rule. All approved signs or lettering on doors
and walls shall be printed, painted, affixed or inscribed at the expense of
Tenant by a person chosen by Landlord.
2. If Landlord objects in writing to any curtains, blinds, shades,
screens or hanging plants or other similar objects attached to or used in
connection with any window or door of the Premises, Tenant shall immediately
discontinue such use. No awning shall be permitted on any part of the Premises.
Tenant shall not place anything against or near glass partitions or doors or
windows which may appear unsightly from outside the Premises.
3. Tenant shall not obstruct any sidewalk, halls, passages, exits,
entrances, elevators, escalators, or stairways of the Building. The halls,
passages, exits, entrances, elevators, escalators and stairways are not open to
the general public. Landlord shall in all cases retain the right to control and
prevent access to such areas of all persons whose presence in the judgment of
Landlord would be prejudicial to the safety, character, reputation and interest
of the Land, Building and the Building's tenants; provided that, nothing in this
Lease contained shall be construed to prevent such access to persons with whom
any Tenant normally deals in the ordinary course of its business, unless such
persons are engaged in illegal activities. Tenant shall not go upon the roof of
the Building.
4. The directory of the Building will be provided exclusively for
the display of the name and location of tenants only, and Landlord reserves the
right to exclude any other names therefrom.
5. All cleaning and janitorial services for the Premises shall be
provided exclusively by Tenant, at Tenant's sole cost. Tenant shall not cause
any unnecessary labor by carelessness or indifference to the good order and
cleanliness of the Premises. Landlord shall not in any way be responsible to any
Tenant for any loss of property on the Premises, however occurring, or for any
damage to any Tenant's property by the janitor or any other person.
6. Landlord will furnish Tenant, free of charge, two (2) keys to
each door lock in the Premises. Landlord may make a reasonable charge for any
additional keys. Tenant shall not make or have made additional keys, and Tenant
shall not alter any lock or install a new additional lock or bolt on any door of
its Premises. Tenant may, upon the prior written consent of Landlord, re-key the
Premises, provided that Tenant provides Landlord with copies of all keys
immediately upon such re-keying. Tenant, upon the termination of its tenancy,
shall deliver to Landlord the keys of all doors which have been furnished to
Tenant, and in the event of loss of any keys so furnished, shall pay Landlord
therefor.
7. If Tenant requires telegraphic, telephonic, computer circuits,
burglar alarm or similar services, it shall first obtain Landlord's approval,
which shall not be unreasonably withheld, and shall pay the entire cost of such
installation(s).
8. Tenant shall not place a load upon any floor of the Premises
which exceeds the load per square foot which such floor was designed to carry
and which is allowed by Governmental Requirements. Landlord shall have the right
to prescribe the weight, size and position of all equipment, materials,
furniture or other property brought into the Building. Heavy objects shall, if
considered necessary by Landlord, stand on such platforms as determined by
Landlord to be necessary to properly distribute the weight. Business machines
and mechanical equipment belonging to Tenant, which cause noise or vibration
that may be transmitted to the structure of the Building or to any space in the
Building or to any other tenant in the Building, shall be placed and maintained
by Tenant, at Tenant's expense, on vibration eliminators or other devices
sufficient to eliminate noise or vibration. The persons employed to move such
equipment in or out of the Building must be acceptable to Landlord. Landlord
will not be responsible for loss of, or damage to, any such equipment or other
property from any cause, and all damage done to the Building by maintaining or
moving such equipment or other property shall be repaired at the expense of
Tenant.
9. Tenant shall not use or keep in the Premises any kerosene,
gasoline or inflammable or combustible fluid or material other than those
limited quantities permitted by the Lease. Tenant shall not use or permit to be
used in the Premises any foul or noxious gas or substance, or permit or allow
the Premises to be occupied or used in a manner offensive or objectionable to
Landlord or other occupants of
Ex. E
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the Building by reason of noise, odors or vibrations nor shall Tenant bring into
or keep in or about the Premises any birds or animals.
10. Tenant agrees to cooperate fully to assure the most effective
operation of the heating and air-conditioning and to comply with any
governmental energy-saving rules, laws or regulations of which Tenant has actual
notice.
11. Landlord reserves the right, exercisable without notice and
without liability to Tenant, to change the name and street address of the
Building.
12. Landlord reserves the right to exclude from the Building
between the hours of 6 p.m. and 7 a.m. the following day, or such other hours as
may be established from time to time by Landlord, and on Sundays and legal
holidays, any person unless that person is known to the person or employee in
charge of the Building and has a pass or is properly identified. Tenant shall be
responsible for all persons for whom it requests passes and shall be liable to
Landlord for all acts of such persons. Landlord shall not be liable for damages
for any error with regard to the admission to or exclusion from the Building of
any person. Landlord reserves the right to prevent access to the Building in
case of invasion, mob, riot, public excitement or other commotion by closing the
doors or by other appropriate action.
13. Tenant shall close and lock the doors of its Premises and
entirely shut off all water faucets or other water apparatus, and electricity,
gas or air outlets before Tenant and its employees leave the Premises. Tenant
shall be responsible for any damage or injuries sustained by other tenants or
occupants of the Building or by Landlord for noncompliance with this rule.
14. Intentionally Omitted.
15. The toilet rooms, toilets, urinals, wash bowls and other
apparatus shall not be used for any purpose other than that for which they were
constructed and no foreign substance of any kind whatsoever shall be deposited
in them. The expenses of any breakage, stoppage or damage resulting from the
violation of this rule shall be borne by Tenant if it or its employees or
invitees shall have caused it.
16. Tenant shall not sell, or permit the sale at retail, of
newspapers, magazines, periodicals, theater tickets or any other goods or
merchandise to the general public in or on the Premises. Tenant shall not make
any room-to-room solicitation of business from other tenants in the Building.
Tenant shall not use the Premises for any business or activity other than that
specifically provided for in the Lease.
17. Tenant shall not install any radio or television antenna,
loudspeaker or other device on the roof or exterior xxxxx of the Building
without the prior written consent of Landlord, as set forth in Section 4.4 of
the Lease. Tenant shall not interfere with radio or television broadcasting or
reception from or in the Building or elsewhere.
18. Intentionally Omitted.
19. Intentionally Omitted.
20. Canvassing, soliciting and distribution of handbills or any
other written material, and peddling in the Building or Land are prohibited, and
Tenant shall cooperate to prevent the same.
21. Landlord reserves the right to exclude or expel from the
Building and Land any person who, in Landlord's judgment, is intoxicated, under
the influence of liquor or drugs or in violation of any of these Rules and
Regulations.
22. Tenant shall store all of its trash and garbage within the
Premises. Tenant shall not place in any trash box or receptacle any material
which cannot be disposed of in the ordinary and customary manner of trash and
garbage disposal. All garbage and refuse disposal shall be made in accordance
with directions issued from time to time by Landlord.
23. The Premises shall not be used for lodging or any improper or
immoral or objectionable purpose. No cooking shall be done or permitted by
Tenant, except that use by Tenant of Underwriters' Laboratory approved equipment
for brewing coffee, tea, hot chocolate and similar beverages shall be permitted;
provided that, such equipment and its use is in accordance with all Governmental
Requirements.
24. Tenant shall not use in the Premises or in the public halls of
the Building any hand truck except those equipped with rubber fires and side
guards or such other material-handling equipment as Landlord may approve. Tenant
shall not bring any other vehicles of any kind into the Building.
25. Without the prior written consent of Landlord, Tenant shall not
use the name of the Building in connection with or in promoting or advertising
the business of Tenant except as Tenant's address.
26. Tenant shall comply with all safety, fire protection and
evacuation procedures and regulations established by Landlord or any
governmental agency.
Ex. E
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27. Tenant assumes any and all responsibility for protecting the
Premises from theft, robbery and pilferage, which includes keeping doors locked
and other means of entry to the Premises closed.
28. The requirements of Tenant will be attended to only upon
appropriate application to the Manager of the Building by an authorized
individual. Employees of Landlord are not required to perform any work or do
anything outside of their regular duties unless under special instructions from
Landlord, and no employee of Landlord is required to admit Tenant to any space
other than the Premises without specific instructions from Landlord.
29. Tenant shall not leave vehicles in the parking areas overnight
nor park any vehicles in the Building parking areas other than automobiles,
motorcycles, motor driven or nonmotor driven bicycles or four-wheeled trucks.
30. Landlord may waive any one or more of these Rules and
Regulations for the benefit of Tenant or any other tenant, but no such waiver by
Landlord shall be construed as a waiver of such Rules and Regulations in favor
of any other person, nor prevent Landlord from thereafter revoking such waiver
and enforcing any such Rules and Regulations against any or all of the tenants
of the Building.
31. These Rules and Regulations are in addition to, and shall not be
construed to in any way modify or amend, in whole or in part, the covenants and
conditions of any lease of premises in the Building. If any provision of these
Rules and Regulations conflicts with any provision of the Lease, the terms of
the Lease shall prevail.
32. Landlord reserves the right to make such other and reasonable
Rules and Regulations as, in its judgment, may from time to time be needed for
safety and security, the care and cleanliness of the Building and Land and the
preservation of good order in the Building. Tenant agrees to abide by all the
Rules and Regulations stated in this exhibit and any additional rules and
regulations which are so made by Landlord.
33. Tenant shall be responsible for the observance of all of the
foregoing rules by Tenant and Tenants Agents.
Ex. E
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