EXHIBIT 10.14
LEASE AGREEMENT
(triple net lease)
This LEASE AGREEMENT ("Lease"), made and entered into by and between
TRANSWESTERN HOHOKAM, L.L.C., a Delaware limited liability company hereinafter
referred to as "LANDLORD", and CPI DEVELOPMENT, INC., A CALIFORNIA CORPORATION,
hereinafter referred to as "TENANT", upon the following terms and conditions:
AGREEMENT
1. LEASED PREMISES. In consideration of the rents reserved and the
covenants and agreements herein contained on the part of Tenant to be observed
and performed, Landlord hereby demises, lets and leases unto Tenant, and Tenant
hereby rents from Landlord, those certain premises consisting of a space
containing an area of approximately 2,216 square feet (hereinafter celled the
"Leased Premises") and constituting a part of the office/warehouse building
(hereinafter called the "Building") located at 0000 Xxxx 00xx Xxxxx, Xxxxx X000,
Xxxxxxx, Xxxxxxxx Xxxxxx, Xxxxxxx which Building is located upon the lot, tract
or parcel of land more particularly described on Exhibit "B" attached hereto and
made a part hereof for all purposes. If the Building is in a development
containing one or more other buildings, such buildings together with all related
site land, improvements, parking facilities, common areas, driveways and
landscaping, together with the Building, shall be referred to as the "Project".
The purpose of the site plan attached as Exhibit "B" is to show the
approximate location, of the Leased Promises. Landlord reserves the right at any
time to relocate, vary and adjust the size of the various buildings, covenants,
automobile parking areas. and other common areas as shown on said site plan. The
use and occupancy by Tenant of the Leased Premises shall include the use, in
common with others entitled thereto, of the common service areas, loading
facilities, pedestrian walks, automobile driveways and parking areas, all as
shown on the site plan attached hereto as Exhibit "B".
In determining the number of square feet of area of the Leased
Premises, Tenant acknowledges that the Leased Premises includes the usable area,
without deduction for columns or projections, multiplied by a load factor to
reflect a share of certain areas, which may include lobbies, corridors,
mechanical utility, janitorial, boiler and service rooms and closets, restrooms
and other public, common and service areas of the Building.
2. TERM. To have and to hold the Leased Premises for a term commencing
on June 28, 1999 ("COMMENCEMENT DATE") and ending on JUNE 30, 2002. However, if
for any reason, Landlord is unable to deliver possession of the Leased Premises
on the Commencement Date, Landlord shall not be liable for any damage caused by
the delay, nor shall this Lease be void or voidable but, rather, it is agreed
that the Lease term shall commence upon the date Landlord tenders possession of
the Leased Premises to Tenant, and unless Landlord elects otherwise, the
expiration date of the Lease shall be extended by the number of days delayed
from the original Commencement Date as set out above. If this Lease is executed
before the Leased Premises become vacant or otherwise available and ready for
occupancy, or if any present tenant or occupant of the Leased Premises holds
over, and Landlord cannot acquire possession of the Leased Premises prior to the
date above recited as the Commencement Date of this Lease, Landlord shall not be
deemed to be in default hereunder, and Tenant agrees to accept possession of the
Leased Premises at such time as Landlord is able to tender the
1
same, which date shall thenceforth be deemed the Commencement Date, and Landlord
hereby waives payment of rent covering any period prior to the tendering of
possession to Tenant hereunder.
3. ACCEPTANCE OF LEASED PREMISES. Tenant acknowledges that of Landlord
has not made any representations or warranty with respect to the condition or
quality of the Leased Premises, Building or Project. Tenant has inspected and
accepts the Leased Premises and Building in their present condition as suitable
for the purpose for which the Leased Premises are leased. Taking of possession
by Tenant shall be deemed conclusively to establish that the Leased Premises,
Building and common areas are in good and satisfactory condition as of when
possession was taken. Tenant further acknowledges that no representations as to
the repair of the Leased Premises or Building nor promises to alter, remodel or
improve the Leased Premises or Building have been made by Landlord, unless such
are expressly set forth in this Lease. After the Commencement Date Tenant
shall,. upon demand,. execute and deliver to Landlord a letter of acceptance of
delivery of the Leased Premises.
4. BASE RENT AND SECURITY DEPOSIT.
(a) Tenant agrees to pay to Landlord rent for the Leased
Premises in advance, without demand, deduction or set off, for the entire term
hereof at the rate of; Year 1: $1,551.20 per month, $18,614.40 per year; Year 2:
$1,595.52 per month, $19,146.24 per year; Year 3: $1,639.84 per month,
$19,678.08 per year. One such monthly installment shall be due and payable on
the date hereof and a like monthly installment shall be due and payable on or
before the first day of each calendar month succeeding the Commencement Date
recited above during the hereby demised term, except that the rental payment for
any fractional calendar month at the commencement or end of the Lease period
shall be prorated.
(b) In addition, Tenant agrees to deposit with Landlord on the
date hereof the sum of $3,191.04, which sum shall be held by Landlord, without
obligation for interest, as security for the performance of Tenant's covenants
and obligations under this Lease, it being expressly understood and agreed that
such deposit is not an advance rental deposit or a measure of Landlord's damages
in case of Tenant's default. Upon the occurrence of any event of default by
Tenant, Landlord may, from time to time, without prejudice to any other remedy
provided herein or provided by law, use such fund to the extent necessary to
make good any arrears of rent or other payments due Landlord hereunder, and any
other damage, injury. expense or liability caused by such event of default; and
Tenant shall pay to Landlord on demand the amount so applied in order to restore
the security deposit to its original amount. Although the security deposit shall
be deemed the property of Landlord any remaining balance of such deposit shall
be returned by Landlord to Tenant at such time after termination of this Lease
that all of Tenant's obligations under this Lease have been fulfilled.
(c) Tenant agrees to pay the Landlord, as additional rent,
concurrent with each monthly base rent installment (or concurrently with any
other payment of rent), all privilege, sales, gross receipts, excise, rental or
other tax, imposed upon the rentals or monetary obligations herein provided to
be paid by Tenant, or upon the rentals or sums received by Landlord, however
denominated, whether such imposition of tax be by a federal, state or local
government or any subdivision thereof.
5. TENANT'S PRO RATA SHARE OF BUILDING COSTS. Subject to all of the
provisions of this Lease relevant hereto, Tenant promises and agrees to pay, as
additional rent hereunder and as provided herein, at the office of the Landlord
2
or at such other place designated by Landlord, without any prior demand therefor
and without any prior demand or set-off throughout the term of this Lease,
Tenant's Pro Rata Share of certain Building expenditures made by Landlord, as
follows:
(a) Real Estate Taxes, as defined in. Article 6;
(b) Common Area Maintenance Costs, as defined in Article 7;
(c) Building Insurance Costs, as defined in Article 8; and
(d) Management fees, as defined in Article 7.
The amounts due from Tenant as Tenant's Pro Rata Share of Real Estate Taxes,
Common Area Maintenance Costs and Insurance shall be estimated by Landlord for
each calendar year and paid by Tenant in equal installments of one-twelfth
(1/12) of such estimated amount, monthly in advance, upon the first day of each
calendar month provided, however, if the tern shall commence upon a day other
than the first day of the calendar month, Tenant shall pay upon the commencement
date of this Lease a portion of Tenant's Pro Rata Share of said expenses
calculated on a per diem basis with respect to the fractional month preceding
the commencement of the first full calendar month of the term of this Lease.
Said amounts shall be adjusted between Landlord and Tenant annually and at the
expiration or earlier termination of this Lease, and payment shall be made to,
or refund made by, Landlord, as the case may be, and Landlord shall receive the
precise amount due as Tenant's Pro Rata Share of the actual cost of said Real
Estate Taxes, Common Area Maintenance Costs and Insurance for the preceding
calendar year or any fractional calendar year. Controllable expense increases
shall be capped at 5% per year. Controllable expenses shall not include all
taxes or insurance.
Tenant will pay Landlord the sum of the following per month, in advance, payable
at the same time and place as the minimum rent is payable, as estimated charges
for Tenant's Pro Rata Share of Real Estate Taxes, Common Area Maintenance Costs
and Insurance Costs for 1999 is $2.40 per square foot.
The estimated charge as set out above are subject to changes from time
to time throughout the Lease term. Failure to pay any one or all of Tenant's Pro
Rata Share of certain Building expenditures shall be constitute an event of
default hereunder.
6. TAXES.
(a) "TAX YEAR" means the calendar and/or fiscal year basis
upon which taxes and/or special assessments/districts are assessed upon the
Building throughout the term of this Lease.
(b) "REAL ESTATE TAXES" means the amount (in dollars) of taxes
and/or special assessments levied or assessed against the land and improvements
of the Building, said taxes to be either ad valorem taxes or a substitution
therefor which may be designated as appropriate by applicable governing
authorities, in any tax year or fractional part thereof. Excluded are all estate
or death, succession, income or franchise taxes.
(c) "TENANT'S PRO RATA SHARE OF REAL ESTATE TAXES" means that
amount obtained by multiplying the Real Estate Taxes by a fraction, the
numerator of which is the square foot area of the Leased Premises and the
denominator of which is the gross leasable area of the Building.
3
(d) "BUILDING" for the purposes of this Section 6 meets all of
the real estate and the buildings and other improvements actually constructed
thereon, including common areas, as more specifically shown on the Site Plan
attached hereto as Exhibit "B'".
LANDLORD'S PAYMENT. Subject to the limitations, conditions and
agreements contained in this Article, Landlord shall pay before delinquency, all
Real Estate Taxes. On or before one hundred eighty (180) days after the end of
the Tax Year, Landlord shall render a statement showing the total of Tenant's
Estimated Tax Payments made in advance during the preceding Tax Year, and the
balance, if any, then due from Tenant. At the time of rendering the statement,
Landlord shall submit to Tenant a true copy of the tax bills. Taxes and/or
special assessments/districts for a fractional year, if any, shall be prorated.
Landlord's failure to provide the statements shall not relieve Tenant of any
liability hereunder.
TENANT'S LIABILITY. Tenant promises and agrees to pay as additional
Rent Tenant's Estimated Pro Rata Share of Real Estate Taxes, monthly in advance,
on the first day of each calendar month, in an amount estimated by Landlord as
provided above.
ANNUAL ADJUSTMENT. Within ten (10) days after the receipt of Landlord's
statement showing the total amount paid in advance by Tenant and a copy of the
paid tax bills showing the actual taxes paid or to be paid by Landlord, there
shall be an adjustment between Landlord and Tenant. Tenant shall pay to Landlord
on demand the difference between the amount paid by Tenant and the actual amount
due. If the total amount paid by Tenant hereunder for any such calendar year
shall exceed such actual amount due from Tenant for such calendar year, the
excess shall be credited by Landlord against any amounts then due and owing by
Tenant to Landlord, and any remaining net surplus shall then be refunded by
Landlord to Tenant. Failure of Tenant to pay Tenant's Pro Rata Share of Real
Estate Taxes in the manner and time provided herein shall constitute an event of
default hereunder.
PERSONAL PROPERTY TAX. Tenant shall pay all personal property taxes
with respect to any personal property located in or comprising the Building.
7. COMMON AREA MAINTENANCE. Landlord agrees to maintain and repair
throughout the term hereof the common areas and facilities of the Building,
including, without limitation, the automobile entrances, exits, driveways,
parking areas, pedestrian walks, landscaped areas, public toilets, meeting
rooms, lighting facilities, service areas and Building signs not otherwise the
responsibility. of Tenant as set out in this Lease (said areas hereinafter
called the "Common Area"). Landlord's maintenance and repairs shall include all
repairs and replacements and the supplies and materials therefor, which in
Landlord's reasonable judgment are necessary to preserve the utility of the
Common Area and facilities in the condition same were in at the time of
completion, reasonable wear and tear only excepted.
As used herein, the term "COMMON AREA MAINTENANCE COSTS" shall mean all
costs and expenses of every kind paid or incurred during the terns of this Lease
in connection with the operation and upkeep of the Common Area and facilities
within the Building, and where necessary, the cost of replacing any of said
common facilities and the cost of policing and protecting same. In addition to
the foregoing, the Common Area Maintenance Costs may include a reserve fund of
ten percent (10%) of the aggregate Common Area Maintenance Costs, which reserve
fund will be put into an escrow account and accrue interest until such time as a
major repair such as resurfacing the parking lot or major concrete drive
4
replacement, where it shall be applied against such "MAJOR REPAIR COST". Also,
in addition to the foregoing, the Common Area Maintenance Costs shall include
but not limited to, maintenance; and repair costs, management fees, wages and
fringe benefits payable to employees of Landlord whose duties are connected with
the operation and maintenance of the Building and common areas, all services,
supplies, repairs, replacements or other expenses for maintaining and operating
the Building. Tenant's Pro Rata Share of the Common Area Maintenance Costs means
that amount obtained by multiplying said Costs by a fraction, the numerator of
which is the square foot area of the Leased premises and the "denominator of
which is the gross leasable area of the Building. Tenant promises to pay as
additional rent Tenant's Pro Rata Share of Common Area Maintenance Costs monthly
in advance, on the first day of each calendar month in an amount estimated by
Landlord as provided above. Landlord's failure to provide the statements shall
not relieve Tenant of any liability hereunder.
ANNUAL ADJUSTMENT. Within ten (10) days after the receipt of Landlord's
statement showing the total amount paid in advance by Tenant and a cop of the
Common Area Maintenance bills showing the actual monies paid or to be paid by
Landlord, there shall be an adjustment between Landlord and Tenant. Tenant shall
pay to Landlord on demand the difference between the amount paid by Tenant and
the actual amount due. If the total amount paid by Tenant hereunder for any such
calendar year shall exceed such actual amount due from Tenant for such calendar
year, the excess shall be credited by Landlord against any amounts then due and
owing by Tenant to Landlord and any remaining net surplus shall then be refunded
by Landlord to Tenant. Failure of Tenant to pay Tenant's Common Area Maintenance
Costs in the manner and time provided herein shall constitute an event of
default hereunder.
8. INSURANCE.
TENANT'S LIABILITY INSURANCE. Tenant agrees, at Tenant's sole cost, to
maintain in force during the term of this Lease a policy or policies of
comprehensive public liability insurance, including property damage, written by
one or more responsible insurance companies approved by Landlord and licensed to
do business in Arizona, which insurance companies shall be rated not less, than
A-13 by Best Guide Rating, insuring Tenant and naming, as additional named
insured, Landlord and such other person, firms or corporations as are designated
by Landlord and acceptable to said insurance companies, insuring against loss of
life, bodily injury and/or property damage with respect to the Leased Premises
and the business operated by Tenant and any subtenant, licensee, concessionaire
or assignee of Tenant in the Leased Premises or Building, in which the limit of
public liability shall not be less than ONE MILLION AND N0/100 DOLLARS
($1,000,000.00) single limit bodily injury and in which the limit of property
damage liability shall be not less than FIVE HUNDRED THOUSAND AND NO/100 DOLLARS
($500,000.00). Additionally, Tenant shall maintain at Tenant's sole cost, plate
glass insurance on the windows and door or doors of the Leased Premises. Each
such policy shall be non-cancelable for any cause without first giving Landlord
thirty (30) days prior written notice. Subject to all of the foregoing, the
insurance coverage required to be furnished by Tenant pursuant to this Section 8
may be in a blanket policy covering all of Tenant's operations. A copy of each
such policy, or a certificate of such insurance together with a receipt showing
all premiums paid thereon for at least one (1) year in advance, shall be
delivered to Landlord upon the commencement of the term of this Lease and
annually thereafter upon the first day of each lease year throughout the term
hereof.
LANDLORD'S LIABILITY INSURANCE. Landlord agrees to maintain in force
during the term of this Lease a policy or policies of comprehensive public
5
liability insurance, including, property damage, written by one or more
responsible insurance companies approved by Landlord and licensed to do business
in Arizona insuring Landlord against loss of life, bodily injury and/or property
damage with respect to the common areas of the Building and the operation of the
Building, in which the limit of public liability shall be not less than FIVE
HUNDRED THOUSAND AND NO/100 DOLLARS ($500,000.00) single limit bodily injury and
in which the limit of property damage liability shall be not less than ONE
HUNDRED THOUSAND AND N0/100 DOLLARS ($100,000.00). In addition, Landlord may
maintain in force such umbrella policy or policies of public liability insurance
as Landlord, in its sole discretion, may deem appropriate.
LANDLORD'S FIRE AND EXTENDED COVERAGE INSURANCE. Landlord agrees to
procure and keep in effect during the term of this Lease a policy or policies of
fire and extended coverage insurance covering the Building, or separate fire
rating division as determined by the State Board of Insurance which includes the
Leased Premises, including rent abatement, vandalism and malicious mischief
coverage, written by an insurance company authorized to do business within the
State of Arizona, and in an amount equal to not less than eighty percent (80%)
of the replacement cost of the premises covered. Such insurance shall provide
protection against losses so insured against for the benefit of Landlord and any
mortgagee of Landlord, subject to the terms and provisions of this Lease and any
mortgage; provided, however, that all proceeds payable "by any insurance company
under such policy or policies shall be payable to such mortgagee, if any, and
shall be applied in accordance with the terms of such mortgage; or, if there is
no mortgage, the full amount of such proceeds shall be payable to Landlord, and
Tenant shall not be entitled to, and shall have no interest in, such proceeds or
any part thereof. Such policy or policies shall contain a provision or
endorsement with respect to mutual waiver of right of subrogation. The Premium
on said insurance shall be paid at lease one (1) year in advance, and Landlord
shall, upon request, furnish Tenant proof of such insurance.
TENANT'S LIABILITY FOR BUILDING INSURANCE COSTS. At the commencement of
the term of this Lease and within one hundred eighty (180) days after the
commencement of each calendar year (or partial calendar year) thereafter,
Landlord shall furnish Tenant a statement, together with a true copy of the
premium statement, showing the Building Insurance Costs for the calendar year in
which the term commences or the applicable calendar year thereafter and any
deductible amount incurred in any loss. Landlord's failure to provide the
statement shall not relieve Tenant of any liability hereunder. As used herein,
the term "BUILDING INSURANCE COSTS" shall mean the actual premium costs of
public liability and fire and extended coverage insurance, including rent
abatement insurance required by this Lease to be maintained by Landlord and any
deductible incurred in any loss. Tenant's Pro Rata Share of public liability
insurance shall be determined by multiplying the total cost of such insurance by
a fraction, the numerator of which is the square foot area of the Leased
Premises and the denominator of which is the gross leasable area of the
Building. Tenant's Pro Rata Share of fire and extended coverage insurance shall
be determined by multiplying said total cost of such insurance by a fraction,
the numerator of which is the square foot area of the Leased Premises and the
denominator of which is the gross leasable area of the Building. Tenant's Pro
Rata Share of Building Insurance Costs shall be, paid as additional rent as
provided above.
ANNUAL ADJUSTMENT. Within ten (10) days after the receipt of Landlord's
statement showing the total amount paid in advance by Tenant and a copy of the
insurance bills showing the actual monies paid or to be paid by Landlord, there
shall be an adjustment between Landlord and Tenant. Tenant shall pay to Landlord
on demand the difference between the amount paid by Tenant and the actual amount
6
due. If the total amount paid by Tenant hereunder for any such calendar year
shall exceed such actual amount due from Tenant for such calendar year, the
excess shall be credited by Landlord against any amounts then due and owing by
Tenant to Landlord and any remaining net surplus shall then be refunded by
Landlord to Tenant. Failure of Tenant to pay Tenant's Insurance Costs in the
manner and time provided herein shall constitute an event of default hereunder.
MUTUAL WAIVER OF SUBROGATION. Notwithstanding any provision in this
Lease to the contrary, Landlord and Tenant each hereby waive any and all rights
of recovery, claim, action or cause of action, against the other, its officers,
employees or agents, for any loss or damage that may occur to the Leased
Premises, or any improvements thereto, or the Building or any improvements
thereto, or any personal property of such party therein, by reason of fire, the
elements, or any other cause is insured against under the terms of standard fire
and extended coverage, general, liability insurance policies, regardless of
cause or origin, including negligence of the other party hereto, its officers,
employees or agents, and each covenants that no insurer shall hold any right of
subrogation against such other party.
9. USE. The Leased Premises shall be used only for the purpose of
general offices, receiving, storing, shipping and selling (other than retail)
products, materials and merchandise made and/or distributed, by Tenant and for
such other lawful purposes as may be incidental thereto. Outside storage,
including, without limitation, trucks and other vehicles, is prohibited without
Landlord's prior written consent. Tenant shall at its own costs and expense
obtain any and all licenses and permits necessary for any such use. Tenant shall
comply with all governmental orders and directives for the correction,
prevention and abatement of nuisances in or upon, or connected with, the Leased
Premises all at Tenant's sole expense. Tenant shall not permit any objectionable
or unpleasant odors, smoke, dust, gas, noise or vibrations to emanate from the
Leased Premises, nor take any other action which would constitute a nuisance or
would disturb or endanger any other tenants of the Building or Project or
unreasonably interfere with the use of their respective premises. Without
Landlord's prior written consent, Tenant shall not receive, store or otherwise
handle any product, material or merchandise which is explosive or highly
inflammable. Tenant will not permit the Leased Premises to be used for any
purpose or in any manner (including, without limitation, any method of storage)
which would render the insurance thereon void or the insurance risk more
hazardous or cause insurance authority to disallow any sprinkler credits.
10. LANDLORD'S REPAIRS. Landlord shall at its expense maintain only the
roof, foundation and the structural soundness of the exterior walls of the
Building in good repair, reasonable wear and tear excepted. Tenant shall repair
and pay for any damage caused by Tenant, or Tenant's employees agents or
invitee, or caused by Tenant's default hereunder. The term "Walls" as used
herein shall not include windows, glass or plate glass, doors, special story
fronts or office entries. Tenant shall immediately give Landlord written notice
of defect or need for repairs, after which Landlord small have reasonable
opportunity to repair same or cure such defect. Landlord's liability with
respect to any defects, repairs or maintenance for which Landlord is responsible
under any of the provisions of this Lease shall be limited to the cost of such
repairs or maintenance or the curing of such defeat.
11. TENANT'S REPAIRS.
(a) Tenant shall at its own cost and expense keep and maintain
all parts of the Leased Premises (except those for which Landlord is expressly
responsible under the terms of this Lease) in good condition, promptly making
7
all necessary repairs and replacements, including but not limited to, windows,
glass, plate glass doors, any special office entry, interior walls and finish
work, floors and floor covering, downspout, gutters, heating and air
conditioning systems, lighting, electrical systems, dock boards, truck doors,
door bumpers, paving, plumbing lines, equipment, and fixtures, termite and pest
extermination, regular removal of trash and debris, including rail spur areas,
keeping the common areas, parking areas, driveways, alleys and the whole of the
Leased Premises in a clean and sanitary condition, and maintaining any spur
track serving the Leased Premises (Tenant agrees to sign a joint maintenance
agreement with the railroad company servicing the Leased Premises, if requested
by the railroad company). Tenant shall not be obligated to repair any damage
caused by fire, tornado or other casualty covered by the insurance to be
maintained by Landlord except with respect to tornado or hurricane damage.
(b) Tenant shall not alter or damage any demising or common
wall or disturb the integrity and support provided by any demising wall and
shall, at its sole cost and expense, promptly repair any damage or injury to any
demising wall caused by Tenant or its employees, agents or invitee.
(c) In the event the Leased Premises constitute a portion of a
multiple occupancy building, Landlord shall have the right to coordinate any
repairs and other maintenance of any rail tracks serving or to serve the
Building, and if Tenant uses the rail tracks, Tenant shall reimburse Landlord
from time to time upon demand, as additional rent, for a share of the costs of
the repairs and maintenance and any other sums specified in any agreement to
which Landlord is a party respecting the tracks, such share to be a fraction,
the numerator of which is the space contained in the Leased Premises, and the
denominator of which is the entire space occupied by rail users in the Building
which sum shall be due and payable ten (10) days after receipt of a statement
thereafter.
(d) Tenant shall, at its own costs 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 within the Leased Premises. The maintenance contractor and the
contract must be approved by Landlord. The service contract must include all
services suggested by the equipment manufacturer within the
operation/maintenance manual and must become effective (and a copy thereof
delivered to Landlord) within thirty (30) days of the date Tenant takes
possession of the Leased Premises.
12. TENANT IMPROVEMENTS AND ALTERATIONS. Tenant shall not make any
alterations, additions or improvements to the Leased Premises (including but not
limited to roof and wall penetrations) or Building or use any portion of the
roof without the prior written consent of Landlord. All Tenant alterations,
additions and/or improvements shall comply with insurance requirements and with
all applicable laws, ordinances, and regulations. Additionally, all Tenant
alterations, additions and/or improvements shall be in accordance with
Landlord's specifications. All Tenant alterations, additions and/or improvements
shall be constructed, lien-free, in a good and workmanlike manner by a licensed
contractor. All plans and specifications for Tenant's alterations, additions
and/or improvements shall be submitted to Landlord for Landlord's written
approval. No other portion of the Building or the Project shall be subject to
any municipal or other requirement to upgrade or otherwise modify any
improvement by reason of such improvements. Tenant agrees that Landlord may
monitor all phases of Tenant's construction. Tenant shall reimburse Landlord for
Landlord's reasonable expenses for reviewing plans and documents and in
monitoring construction. Landlord's review of plans and monitoring construction
8
shall be solely for Landlord's own benefit and shall impose no duty or
obligation on Landlord to confirm that the plans and specifications and/or
construction comply with applicable laws, codes, rules, or regulations. At
Landlord's request, Tenant shall obtain payment and performance bonds approved
by Landlord, for any Tenant construction which bonds shall be delivered to
Landlord prior to commencement of construction. Upon completion of Tenant's
construction, Tenant shall deliver to Landlord sworn statements setting forth
the names of all contractors, subcontractors and suppliers who performed work or
supplied materials along with final lien waivers from such contractors,
subcontractors and suppliers. Tenant may, without the consent of Landlord, but
at its own cost and expense and in a good workmanlike manner, erect such
shelves, bins, machinery, and trade fixtures as it may deem advisable, without
altering the basic character of the Building or improvements and without
overloading or damaging such Building or improvements, and in each case,
complying with all applicable governmental laws, ordinances, regulations and
other requirements. All alterations, additions, improvements and partitions
erected by Tenant shall be and remain the property of Tenant during the term of
this Lease and Tenant shall pay all property taxes thereon. Tenant shall, unless
Landlord otherwise elects as hereinafter provided, remove all alterations,
additions, improvements and partitions erected by Tenant and restore the Leased
Premises to its original condition by the date of termination of this Lease or
upon earlier vacating of the Leased Premises; provided, however, that if
Landlord so elects prior to termination of this Lease or upon earlier vacating
of the Leased Premises, such alterations, additions, improvements and partitions
shall become the property of Landlord as of the date of termination or this
Lease or upon earlier vacating of the Leased Premises and shall be delivered up
to the Landlord with the Leased Premises. All shelves, bins, machinery and trade
fixtures installed by Tenant may be removed by Tenant prior to the termination
of this Lease if Tenant so elects, and shall be removed by the date of
termination of this Lease or upon earlier vacating of the Leased Premises if
required shall be accomplished in a good workmanlike manner so as not to damage
the primary Structure or structural qualities of the buildings and other
improvements situated on the Leased Premises (SEE EXHIBIT "C").
13. SIGNS. Tenant shall have the right to install signs upon the Leased
Premises only when first approved in writing by Landlord and subject to delivery
to Landlord of an applicable sign permit and any applicable governmental laws,
ordinances, regulations, Landlord's or other architectural controls, and other
requirements. Tenant shall remove all such signs by the termination of this
Lease. Such installations and removals shall be made in such manner as to avoid
injury or defacement of the Building and other improvements, and Tenant shall
repair any injury or defacement, including, without limitation, discoloration,
caused by such installation and/or removal.
14. INSPECTION. Landlord and Landlord's agents and representatives
shall have the right to enter and inspect the Leased Premises and Building at
any reasonable time during business hours, for the purpose of ascertaining the
condition of the Leased Premises or in order to grade such repairs as may be
required or permitted to be made by Landlord under the terms of this Lease.
During the period that is six (6) months prior to the end of the term hereof,
Landlord and Landlord's agents and representatives shall have the right to enter
the Leased Premises at any reasonable time during business hours for the purpose
of showing the Leased Premises and shall have the right to erect on the Leased
Premises a suitable sign indicating the Leased Premises are available. Tenant
shall give written notice to Landlord at least thirty (30) days prior to
vacating the Leased Premises and shall arrange to meet with Landlord for a joint
inspection of the Leased Premises prior to vacating. In the event of Tenant's
failure to give such notice or arrange to meet with Landlord for a joint
9
inspection of the Leased Premises prior to vacating, Landlord's inspection at or
after Tenant's vacating the Leased Premises shall be conclusively deemed correct
for purposes of determining Tenant's responsibility for repairs and restoration.
15. UTILITIES. Landlord agrees to provide at Landlord's cost water,
electricity and telephone service connections into the Leased Premises; but
Tenant shall pay for al1 water, gas, heat, light, power, telephone, garbage,
sewer, sprinkler charges and other utilities and services used on or from the
Leased Premises, together with any deposits, taxes, penalties, surcharges or the
like pertaining thereto and any maintenance charges for utilities, as well as
shall furnish all electric light bu1bs and tubes. If any such services are not
separately metered to Tenant, Tenant shall pay Tenant's reasonable proportion,
as determined by Landlord, of all charges jointly metered with other premises,
Landlord shall in no event be liable for any interruption or failure of utility
services on the Leased Premises.
16. ASSIGNMENT AND SUBLETTING.
(a) Tenant will not assign this Lease or any interest therein,
or allow same to be assigned by operation of law or otherwise, or sublet the
Leased Premises or any part thereof or permit any other party to possess the
Leased Premises or any part thereof without the prior written consent of
Landlord, which consent Landlord may withhold in its sole and absolute
discretion. Notwithstanding any permitted assignment or subletting. Tenant shall
at all times remain directly, primarily and fully responsible and liable for the
payment of the rent herein specified and for compliance with all of its other
obligations under the terms, provisions and covenants of this Lease. No consent
to one assignment or subletting shall waive the requirement for the consent of
Landlord to future assignments and sublettings. If the Leased Premises or any
part thereof are then assigned or sublet, Landlord, in addition to any other
remedies herein provided or provided 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 rent against any sums due to Landlord from
Tenant hereunder, and no such collection shall be construed to constitute a
novation or a release of Xxxxxxx from the further performance of Tenant's
obligations hereunder. For purpose of this Lease and transfer of more than fifty
percent (50%) of the beneficial interest in Tenant or of the control of Tenant
(if Tenant is a partnership, corporation, limited liability, company, trust, or
other type of business, organization or entity) shall constitute an assignment
of this Lease.
(b) If Tenant small propose to sublet or assign this Lease, it
shall so notify Landlord in writing not less than thirty (30) days prior to the
date of the proposed assignment or subletting. The notice shall set forth the
name of the proposed subtenant or assignee, the term, use, rental rate and other
particulars of the proposed subletting or assignment, including without
limitation, proof satisfactory to Landlord that the proposed subtenant or
assignee is financially responsible and will immediately occupy and hereafter
use the entire Leased Premises (or any sublet portion thereof) for the remaining
term of this Lease (or for the entire term of the sublease, if shorter).
(c) Landlord shall have the option, in the event of any
proposed assignment or subletting, to cancel this Lease as of the date the
subletting or assignment described in Tenant's notice is to be effective. The
option shall be exercised, if at all, by Landlord's giving Tenant written notice
thereof within twenty (20) days following Landlord's receipt of Tenant's written
request. Upon cancellation, Tenant shall pay to Landlord all costs or charges
which are the responsibility of Tenant hereunder through the date of
10
cancellation, and Tenant shall, at Tenant's own cost and expense, discharge in
full any outstanding commission obligation on the part of Landlord with respect
to this Lease. Further, upon any such cancellation Landlord and Tenant shall
have no further obligations or liabilities to each other under this Lease,
except with respect to obligations or liabilities which accrue hereunder as of
the cancellation date in the same manner as if such cancellation date were the
date originally fixed for the expiration of the term hereof. Without limitation,
Landlord may lease the Leased Premises to the prospective subtenant or assignee,
without liability to the Tenant. Landlord's failure to exercise any right
hereunder shall not waive Landlord's right as to any subsequent proposed
sublease or assignment, nor shall any such failure be deemed to constitute
Landlord's right as to any subsequent proposed sublease or assignment, nor shall
any such failure be deemed to constitute Landlord's approval of the proposed
sublease or assignment.
(d) If Landlord does not cancel this Lease, Landlord agrees to
approve any assignment by Tenant to any corporation succeeding to substantially
all the business and assets of Tenant by merger, consolidation, purchase of
assets or otherwise, or the any assignment or subletting to a corporation which
is an affiliate of tenant. In other cases, provided that there is no event of
default on the part of Tenant (or circumstances which, with the passing of time,
giving of notices, or both, would Constitute an event of default, Landlord
agrees not to unreasonably withhold approval of any proposed subletting or
assignment as to which Landlord declines its rights of cancellation hereunder
provided the proposed transaction is consummated within thirty (30) days after
Landlord's approval, is upon the same terms and conditions disclosed to Landlord
in Tenant's notice, and the assignment or subletting is with another financially
responsible party whose use of the Leased Premises will not depreciate the value
of the Leased Premises, or the value of the property adjacent thereto, or will
not be extra hazardous with reference to the risk of fire or other hazards, and
shall not result in any additional environmental risk for the Project. In the
event Landlord does not consent to an assignment, Tenant's sole remedy shall be
to seek specific performance, not monetary damages. Any assignment or subletting
without Landlord's approval, where required hereunder, shall be void and of no
effect.
(e) Landlord shall have the right to transfer and assign, in
whole or in part, any of its rights under this Lease, and in the Building or
Project referred to herein; and to the extent that such assignee assumes
Landlord's obligations hereunder, Landlord shall by virtue of such assignment be
released from such obligations under this Lease.
17. FIRE AND CASUALTY DAMAGE.
(a) If the Building should be damaged or destroyed by fire,
tornado or other casualty, Tenant shall give immediate written notice thereof to
Landlord.
(b) If the Building should be totally destroyed by fire,
tornado or other casualty, or if they should be so damaged, thereby that
rebuilding or repairs cannot in Landlord's estimation be completed within two
hundred (200) days after the date upon which Landlord is notified by Tenant of
such damage, this Lease shall terminate and the rent shall be abated during the
unexpired portion of this Lease, effective upon the date of the occurrence of
such damage.
(c) If the Building should be damaged by any peril covered by
the insurance to be provided by Landlord this Lease, but only to such extent
11
that rebuilding or repairs can in Landlord's estimation be completed within two
hundred (200) days after the date upon which Landlord is notified by Tenant of
such damage, this Lease shall not terminate, and Landlord shall at its sole
costs and expense thereupon proceed with reasonable diligence to rebuild and
repair the Building to substantially the condition in which it existed prior to
such damage, except that Landlord shall not be required to rebuild, repair or
replace any part of the partitions, fixtures, alterations, additions and other
improvements which may have been placed in, on or about the Leased Premises by
Tenant. If the Leased Premises are untenantable, the rent owed by Tenant shall
not be abated but shall be reduced to such extent as may be fair and reasonable
under all of the circumstances. In the event that Landlord shall fail to
complete such repairs and rebuilding within two hundred (200) days after the
date upon which Landlord is notified by Tenant of such damage, Tenant may at its
option terminate this lease by delivering written notice of termination to
Landlord within ten (10) days after expiration of such two hundred (200) day
period as Tenant's exclusive remedy, whereupon all rights and obligations
hereunder shall cease and terminate. Failure by tenant to timely terminate this
Lease as set forth in the preceding sentence shall be deemed a waiver by Tenant
of its right to do so.
(d) Notwithstanding anything herein to the contrary, in the
event the holder of any indebtedness secured by a mortgage or deed of trust
covering the Leased Premises requires that the insurance proceeds be applied to
such indebtedness, than Landlord shall have the right to terminate this Lease by
delivering written notice of termination to Tenant within fifteen (15) days
alter such requirement is made by any such holder, whereupon all rights and
obligations hereunder shall cease and terminate.
(e) This Lease shall be considered an express agreement
governing any case of damage to or destruction of the Leased Premises or
building by fire or other casualty, and any present or future law which purports
to govern the rights of Landlord and Tenant in such circumstances in the absence
of express agreement, shall have no application.
18. CONDEMNATION.
(a) If the whole or any substantial part of the Leased
Premises should be taken from any public or quasi-public use under governmental
law, ordinance or regulation, or by right of eminent domain, or by private
purchase in lieu thereof and the taking would prevent or materially interfere
with the use of the Leased Premises for the purposes for which they are being
used, this Lease shall terminate and the rent shall be abated during the
unexpired portion, of this Lease, effective when the physical taking of the
Leased Premises shall occur.
(b) If part of the Leased Premises shall be taken for any
public or quasi-public use under any governmental law, ordinance or regulation,
or by right of eminent domain, or by private purchase in lien thereof, and this
Lease is not terminated as provided in the subparagraph above, this Lease shall
not terminate but the vent payable hereunder during the unexpired portion of
this Lease shall be reduced to such extent as may be fair and reasonable under
all of the circumstances.
(c) All compensation awarded for any such taking or
condemnation, or sale proceeds in lieu thereof (including without limitation all
value for the leasehold estate under this Lease), shall be the property of
Landlord, and Tenant shall have no claim thereto, the same being hereby
expressly waived by Tenant, except for separate award which is specifically
12
allocated by the condemning or purchasing party for the taking of or damage to
trade fixtures of Tenant, which Tenant specifically reserves to itself. Tenant
shall make no claim and hereby assigns its award to Landlord for the value of
any unexpired lease term.
19. HOLDING OVER. If Tenant holds over after the expiration or
termination of this Lease, unless the parties hereto otherwise agree in writing
on the terms of such holding over, the hold over tenancy shall be subject to
termination by Landlord at any time upon not less than ten (10) days advance
written notice, or by Tenant at any time upon not less than thirty (30) days
advance written notice regardless of any shorter statutory period. During the
hold over, all of the other terms and provisions of this Lease shall be
applicable during that period, except that Tenant shall pay Landlord from time
to time upon demand, as rental for the period of any holdover, an amount equal
to two (2) times the rent in effect on the termination date, computed on a daily
basis for each day of the hold over period. No holding over by Tenant, whether
with or without consent of Landlord, shall operate to extend this Lease except
as otherwise expressly provided. The preceding provisions of this paragraph
shall not be construed as Landlord's consent for Tenant to hold over.
20. QUIET ENJOYMENT. Landlord covenants that it now has, or will
acquire before Tenant takes possession of the Leased Premises, good title to the
Leased Premises, free and clear of all liens and encumbrances, excepting only
the lien for current taxes not yet due, such mortgage or mortgages as are
permitted by the terms of this Lease, zoning ordinances and other building and
fire ordinances and governmental regulations relating to the use of such
property, and easements, restrictions and other conditions of record. In the
event this Lease is a sublease, then Tenant agrees to take the Leased Premises
subject to the provisions of the prior leases. Landlord represents and warrants
that it has full right and authority to enter into this Lease and that Tenant,
upon paying the rentals herein set forth and performing its other covenants and
agreements herein set forth, shall peaceably and quietly have, hold and enjoy
the Leased Premises for the term hereof without hindrance or molestation from
Landlord, subject to the terms and provisions of this Lease.
21. TENANT'S EVENTS OF DEFAULT. The following events shall be deemed to
be events of default by Tenant under this Lease:
(a) Tenant shall fail to pay any installment of the rent or
additional rent herein reserved when due, or any payment with respect to
Tenant's Pro Rata Share of Building expenditures hereunder when due, or any
other payment or reimbursement to Landlord required herein when, due, and such
failure shall continue for a period of five (5) days from the date such payment
was due.
(b) Tenant shall become insolvent, or shall make a transfer in
fraud of creditors, or shall make an assignment for the benefit of creditors.
(c) Tenant shall be adjudged bankrupt or insolvent in
proceedings filed against Tenant.
(d) A receiver or trustee shall be appointed for all or
substantially all of the assets of Tenant.
(e) Tenant shall desert or vacate any substantial portion of
the Leased Premises.
13
(f) Tenant shall fail to comply with any term, provision or
covenant of this Lease (other than the foregoing in this Paragraph), and shall
not cure such failure within twenty (20) days after written notice thereof to
Tenant.
22. LANDLORD'S REMEDIES. Upon the occurrence of any such events of
default described in Paragraph 19 hereof, Landlord shall have the option to
pursue any one or more of the following remedies without any notice or demand
whatsoever:
(a) Terminate this Lease by written notice to Tenant given at
any time, or terminate Tenant's rights to possession of the Leased Premises
under this Lease (but not the Lease, itself), and in either event Landlord shall
have the right to immediate possession of the Leased Premises and may reenter
the Leased Premises, change the locks and remove all persons and property then
from using all force necessary for this purpose without being guilty in any
manner of trespass or otherwise; and any and all damages to Tenant, or persons
holding under Tenant, by reason of such re-entry are hereby expressly waived;
and any such termination or re-entry on the part of Landlord shall be without
prejudice to any remedy available to Landlord for arrears of rent, breach of
contract, damages or otherwise, nor shall the termination of this Lease or of
Tenant's rights of possession under this Lease by Landlord acting under this
subsection be deemed in any manner to relieve Tenant from the obligation to pay
the rent and all other amounts due or to become due as provided in this Lease
for and during the entire unexpired portion then remaining of the Lease term. In
the event of termination of this Lease or of Tenant's rights of possession under
this Lease by Landlord as provided in this subparagraph, Landlord shall have the
further right (but not the obligation) to relet the Leased Premises upon such
terms, conditions and covenants as are deemed proper by Landlord for the account
of Tenant, and in such event, Tenant shall pay to Landlord all costs of
renovating and altering the Leased Premises for a new tenant or tenants in
addition to al1 brokerage and/or legal fees incurred in connection therewith.
Landlord shall credit Tenant only for such amounts as are actually received from
such reletting during the then remaining Lease term. At the written election of
Landlord made at any time, as a liquidated amount and not as a penalty, Tenant
covenants and agrees to pay as damages to Landlord, upon any such termination by
Landlord of this Lease or of Tenant's rights of possession under this Lease,
such sum as at the time of such termination equals the amount of the excess, if
any, of the then present value of all the rent which would have been due and
payable hereunder during the remainder of the full Lease term (had Tenant kept
and performed all agreements and covenants of Tenant set forth in this Lease)
over and above the then present rental value of the Leased Premises for said
remainder of the Lease term, as determined by Landlord. For purposes of present
value calculations, Landlord and Tenant stipulate and agree to a discount rate
of six (6) percent per annum.
(b) Without terminating this Lease, to enter upon the Leased
Premises and without being guilty in any manner of trespass or otherwise and
without liability for any damage to Tenant or persons holding under Tenant by
reason of such re-entry, all of which are hereby expressly waived, and to do or
perform whatever Tenant is obligated hereunder to do or perform under the terms
of this Lease; and/or Tenant shall reimburse Landlord on demand for any expenses
or other sums which Landlord may incur or expend plus fifteen percent (15%)
thereof to cover Landlord's overhead and administrative cost, pursuant to this
subparagraph, and Landlord shall not be liable for any damages resulting to
Tenant from such action, whether caused by the negligence of Landlord or
otherwise; provided, however, nothing in this subsection shall be deemed an
obligation or undertaking by Landlord to remedy any such defaults of Tenant.
14
(c) Without waiving such event of default, apply all or any
part of the security deposit to cure the errant of default or to any damages
suffered as a result of the event of default to the extent of the amount of
damages suffered. Tenant shall reimburse Landlord for the amount of such
depletion of the security deposit on demand.
(d) In addition to any of the remedies noted above or
hereinafter, Landlord is entitled to distraint for rent and is authorized to
enter upon and take possession of the Leased Premises and remove any property
that may be found within the Leased Premises. Landlord shall have the right to
change any and all locks and other security devices restricting access to the
Leased Promises. To the extent permitted by law, Tenant hereby waives: (i) any
notices of Landlord's intent to re-enter or re-take possession of Leased
Premises; (ii) any notice provided by statute or otherwise of such re-entry, or
repossession or changing of locks; (iii) any claim or cause of action, whether
based on trespass, conversion, or otherwise, against Landlord or Landlord's
agents, employees, officers, or contractors for any damages caused by the
alteration of any locks or reentry or repossession by Landlord, whether or not
caused by the negligence of Landlord or otherwise; and (iv) any right of
redemption, re-entry, or repossession of Tenant and any notice of legal
proceeding for re-entry, including actions for forcible detainer and entry.
(e) Specifically enforce any provision of this Lease.
Provided that Landlord has not terminated the Lease in writing or
permanently excluded Tenant from the Leased Premises, Landlord shall not be
obligated to provide a new key to Tenant except during Landlord's normal
business hours, and only after the following: (1) Tenant cures all events of
default existing at the time of lock-out, including payment of late charges and
reasonable expenses of lock-out (which shall include the cost of security
services and removal of old locks and installation of new locks), and (2) Tenant
has provided Landlord additional security or further assurances of Tenant's
future performance of all Tenant's obligations arising under the Lease, such
security or assurances to be satisfactory to Landlord in the exercise of
Landlord's sole and absolute discretion, which security may include, but is not
limited to, a requirement that the security deposit be increased to an amount
equal to three (3) months rent. Such lock-out should not be deemed to be a
termination of the Lease unless Landlord gives a written notice of termination
to Tenant. It is agreed that if Tenant abandons or vacates the Leased Premises,
Landlord may take such steps as Landlord deems necessary, appropriate, or
desirable to protect the Leased Premises and the property therein from
deterioration, including but not limited to, the lock-out of Tenant as described
herein.
In the event Tenant fails to pay any installment of rent or any
reimbursement, additional rental, or any other payment hereunder as and when
such payment is due, to help defray the additional cost to Landlord for
processing such late payments Tenant shall pay to Landlord on demand a late
charge in an amount equal to five percent (5%) of such installment,
reimbursement, additional rental or any other payment and the failure to pay
such late charge within ten (10) days after demand therefore shall be an event
of default hereunder. The provision for such late charge shall be in addition to
all of Landlord's other rights and remedies hereunder or at law and shall not be
construed as liquidated damages or as limiting Landlord's remedies in any
manner.
Pursuit of any of the forgoing remedies shall not preclude pursuit of
any of the other remedies herein provided or any other remedies provided by law,
15
nor shall pursuit of any remedy herein provided constitute a forfeiture or
waiver of any rent due to Landlord hereunder or of any damages accruing to
Landlord by reason of the violation of any of the terms, provisions and
covenants herein contained. Notwithstanding anything in this Lease to the
contrary, no act or thing done by the Landlord or its agents during the term
hereby granted shall be deemed a termination of this Lease or an acceptance of
the surrender of the Leased Premises, and no agreement to terminate this Lease
or accept a surrender of the Leased Premises shall be valid unless in writing
signed by Landlord. No waiver by Landlord of any violation or breach of any of
the terms, provisions and covenants herein contained. Landlord's acceptance of
the payment of rental or other payments hereunder after the occurrence of an
event of default shall not be construed as a waiver of such default, unless
Landlord so notifies Tenant in writing. Forbearance by Landlord to enforce one
or more of the remedies herein provided upon an event of default shall not be
deemed or construed to constitute a waiver of such default or of Landlord's
right to enforce any such remedies with respect to such default or any
subsequent default. If, on account of any breach or default by Tenant in
Tenant's obligations under the terms and conditions of this Lease, it shall
become necessary or appropriate for Landlord to employ or consult with any
attorney concerning or to enforce of defend any of Landlord's rights or remedies
hereunder, Tenant agrees to pay any reasonable attorney's fees so incurred.
All sums due and owing by Tenant to Landlord under this Lease shall
bear interest from the date due until paid at the greater of (i) two percent
(2%) above the "prime rate" per annum of Bank One, Arizona, or its successor in
effect on said due date or (ii) eighteen percent (18%) per annum. In either
case, such interest to be compounded daily; provided, however, in no event shall
the rate of interests hereunder exceed the maximum non-usurious rate of interest
(hereinafter called the "Maximum Rate") permitted by the applicable laws of the
State of Arizona or the United States of America, whichever shall permit the
higher non-usurious rate, and as to which Tenant could not successfully assert a
claim or defense of usury.
23. LANDLORD'S LIEN. 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 rentals and other sums of money becoming
due hereunder from Tenant, upon all goods, wares, equipment, fixtures,
furniture, inventory, accounts, contract rights, receivables, chattel paper and
other personal property of Tenant situated on the Leased Premises, and such
property shall not be removed there from without the consent of Landlord until
all arrearage in rent as well as any and all other sums of money them due to
Landlord hereunder shall first have been paid and discharged. In the event of a
default under this Lease, Landlord shall have, in addition to any ether remedies
provided herein or by law, all rights and remedies under the Uniform Commercial
Code, including without limitation the right to sell the property described in
this paragraph at public or private sale upon five (5) 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. Any statutory lien for rent is not hereby waived, the express
contractual lien herein granted being in addition and supplementary thereto.
24. SUBORDINATION. This Lease and all rights of Tenant hereunder are
subject and subordinate (i) to any mortgage or deed of trust, blanket or
otherwise, which does now or may hereafter affect the Building (and which may
also affect other properties) and (ii) to any and all increases, renewals,
modifications, consolidations, replacements and extensions of any such mortgage
or deed of trust. This provision is hereby declared by Landlord and Tenant to be
self-operative and no further instruments shall be required to effect such
16
subordination of this Lease. Tenant shall, however, upon demand at any time or
times execute, acknowledge and deliver to Landlord any and all instruments and
certificates that may be necessary or proper to more effectively subordinate
this Lease and all rights of Tenant hereunder to any such mortgage or deed of
trust or to confirm or evidence such subordination. In the event Tenant shall
fail or neglect to execute, acknowledge and deliver any subordination agreement
or certificate, Landlord in addition to any other remedies it may have, as the
agent and attorney in fact of Tenant, execute, acknowledge and deliver the same
and Tenant hereby irrevocably nominates, constitutes and appoints Landlord
Tenant's proper and legal agent and attorney in fact for such purposes. Such
power of attorney shall not terminate on disability of the principal. Tenant
covenants and agrees, in the event any proceedings are brought for the
foreclosure of any such mortgage or if the Building is sold to any purchaser, to
attorney to and recognize such purchaser as the Landlord under this Lease.
Tenant agrees to execute and deliver at any time and from time to time, upon the
request of Landlord or of any holder(s) of any of the indebtedness or other
obligations secured by any of the mortgages or deeds of trust be necessary or
appropriate in any such foreclosure proceeding or otherwise to evidence such
attornment. Tenant hereby irrevocably appoints Landlord and the holders of the
indebtedness or other obligations secured by the aforesaid mortgages and/or
deeds of trust jointly and severally the agent and attorney shall not terminate
on disability of the principal. Tenant further waives the provisions of any
statute or rule of law, now or hereafter in effect, which may give or purport to
give Tenant any right or election to terminate or otherwise adversely affect
this Lease and the obligation of Tenant hereunder in the event any such
foreclosure proceedings is brought or trustee's sale occurs and agrees that this
Lease shall not be affected in any way whatsoever by any such foreclosure
proceeding or trustee's sale unless the holder(s) of the indebtedness or other
obligations secured by said mortgages and/or deeds of trust shall declare
otherwise. Notwithstanding the foregoing, if any trustee, mortgagee or ground
lessor shall elect to have this Lease prior to the lien of its deed of trust,
mortgage or ground lease, and shall give written notice thereof to Tenant, this
Lease shall be deemed prior to such deed of trust, mortgage or ground lease,
whether this Lease is dated prior to or subsequent to the date of the deed of
trust, mortgage or ground lease, or the date such instrument is recorded is
prior to or subsequent to the date of this Lease, and Tenant hereby agrees and
shall attorney to such party and their successors and assigns upon request.
25. LANDLORD'S DEFAULT. Landlord shall only be deemed to be in default
on the terms of the Lease in the event Landlord shall violate, neglect, or fail
to observe, kept or perform any covenant or agreement which is not observed,
kept, or performed by Landlord within thirty (30) days after the receipt by
Landlord of Tenant's written notice of such breach which notice shall
specifically set out the breach. Landlord shall not be considered in default so
long as Landlord commences to cure the breach in a diligent and prudent manner
and is allowed such additional time as reasonably necessary to correct the
breach. Notwithstanding any provisions to the contrary contained in this Lease,
no personal liability of any kind or character whatsoever shall attach or at any
time hereafter attach under any conditions to Landlord or any subsidiary,
affiliate or partner of Landlord or their respective officers, directors,
shareholders, or employees for payments of any amounts due under this Lease or
for the performance of any obligation under this Lease. The exclusive remedies
of Tenant for failure of Landlord to perform any of its obligations under this
Lease shall be to proceed against the interest of Landlord in and to the Leased
Premises it being understood that in no event shall a judgment for any
deficiency or monetary claim be sought, obtained or enforced against landlord or
any subsidiary, affiliate or partner of Landlord or their respective officers,
directors, shareholders or employees. In no event shall Landlord be liable for
any consequential, special, punitive or exemplary damages.
17
26. 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 in the
Leased Premises or to charge the rentals payable hereunder for any claim in
favor of any person dealing with Tenant, including those who may furnish
materials or perform labor for any construction or repairs, and each such claim
shall affect and each such lien shall attach to, if it all, only the leasehold
interest granted to Tenant by this instrument. Tenant covenants and agrees that
it will 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 Leased Premises on which any lien is or can be validly and
legally asserted against its leasehold interest in the Leased Premises or the
improvements thereon and that it will indemnify, defend and save and hold
Landlord harmless for, from and against any and all loss, cost or expense based
on or arising out of asserted claims or liens against the leasehold estate or
against the right, title and interest of the Landlord in the Leased Premises or
under the terms of this Lease.
27. NOTICES. Each provision of this instrument or of any applicable
governmental laws, ordinances, regulations and other requirements with reference
to the sending, mailing or delivery of any notice or the making of any payment
by Landlord to Tenant or with reference to the sending, mailing or delivery of
any notice or the making of any payment by Tenant to Landlord shall be deemed to
be complied with when and if the following steps are taken:
(a) All rent and other payments required to be made by Tenant
to landlord hereunder shall be payable to Landlord at the address hereinbelow
set forth or at such other address as Landlord may specify from time to time by
written notice delivered in accordance herewith. Tenant's obligation to pay rent
and any other amounts to Landlord under the terms of this Lease shall not be
deemed satisfied until such rent and other amounts have been actually received
by Landlord.
(b) All payments required to be made by Landlord to Tenant
hereunder shall be payable to Tenant at the address hereinbelow set forth, or at
such other address within the continental United States as Tenant may specify
from time to time by written notice delivered in accordance herewith.
(c) Any notice or document required or permitted to be
Delivered hereunder shall be deemed to be delivered whether actually received or
not, when deposited in the United States Mail, postage prepaid, Certified or
Registered Mail, addressed to the parties hereto at the respective addresses set
out below, or at such other address as they have heretofore specified by written
notice delivered in accordance herewith:
Landlord: Tenant:
--------- -------
0000 Xxxxx 00xx Xxxxxx, Xxxxx 000 0000 Xxxx 00xx Xxxxx, Xxxxx X000
Xxxxxxx, XX 00000 Xxxxx, XX 00000
If and when included within the term "Landlord", as used in this instrument,
there are more than one person, firm or corporation, all shall jointly arrange
among themselves for their joint execution of such a notice specifying some
individual at some specific address for their receipt of notices and payments to
Landlord; if and when included within the term "Tenant" as used in this
instrument, their are more than one person, firm or corporation, all shall
jointly arrange among themselves for their joint execution of such a notice
specifying some individual at some specific address within the continental
18
United States for the receipt of notices and payments to Tenant. All parties
included within the terms "Landlord" and "Tenant", respectively, shall be bound
by notices given in accordance with the provisions of this paragraph to the same
effect as if each had received such notice.
28. MISCELLANEOUS.
(a) Words of any gender used in this Lease shall be held and
construed to include any other gender, and words in the singular number shall be
held to include the plural, unless the context otherwise requires.
(b) The terms, provisions and covenants and conditions
contained in this Lease shall apply to, inure to the benefit of, and be binding
upon, the parties hereto and upon their respective heirs, legal representatives,
successors and permitted assigns, except as otherwise herein expressly provided.
Each party agrees to furnish to the other, promptly upon demand, a corporate
resolution, proof of due authorization by partners, or other appropriate
documentation evidencing the due authorization of such party to enter into this
Lease.
(c) The captions inserted in this Lease are for convenience
only and in no way define, limit or otherwise describe the scope or intent of
this Lease, or any provision hereof, or in any way affect the interpretation of
this Lease.
(d) Tenant agrees from time to time within ten (10) days after
request of Landlord, to deliver to Landlord, or Landlord's designee, an estoppel
certificate stating that this Lease is in full force and effect, the date to
which rent has been paid, the unexpired term of this Lease and such other
matters pertaining to this Lease as may be requested by Landlord. It is
understood and agreed that Tenant's obligation to furnish such estoppel
certificates in a timely fashion is a material inducement for Landlord's
execution of this Lease.
(e) This Lease may not be altered, changed or amended except
by an instrument in writing signed by both parties hereto.
(f) All obligations of Tenant hereunder not fully performed as
of the expiration or earlier termination of the term of this Lease shall survive
the expiration or earlier termination of the term hereof, including, without
limitation, all payments obligations with respect to taxes and insurance and all
obligations concerning the condition of the Leased Premises. Upon the expiration
or earlier termination of the term hereof, and prior to Tenant vacating the
Leased Premises, Tenant shall pay to Landlord any amount reasonably estimated by
Landlord as necessary to put the Leased Premises, including without limitation
all heating and air conditioning systems and equipment therein, in good
condition and working order. Tenant shall also, prior to vacating the Leased
Premises, pay to Landlord the amount, as estimated by Landlord, of Tenant's
obligation hereunder for Tenant's pro rata share of Building Costs for the year
in which the Lease expires or terminates. All such amounts shall be used and
held by Landlord for payment of such obligations of Tenant hereunder, with
Tenant being liable for any additional costs therefor upon demand by Landlord,
or with any excess to be returned to Tenant after all such obligations have been
determined and satisfied, as the case may be. Any security deposit held by
Landlord shall be credited against the amount payable by Tenant under this
Paragraph.
19
(g) If any clause or provision of this Lease is illegal,
invalid or unenforceable under present or future laws effective during the term
of this Lease, then and in that event, it is the intention of the parties hereto
that the remainder of this Lease shall not be affected thereby, and it is also
the intention of the parties to this Lease that in lieu of each clause or
provision of this Lease that is illegal, invalid or unenforceable, there be
added as a part of this Lease contract 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.
(h) Because the Leased Premises are on the open market and are
presently being shown, this Lease shall be treated as an offer with the Leased
Premises being subject to prior lease and such offer to withdrawal or
non-acceptance by Landlord or to other use of the Leased Premises without
notice, and this Lease shall not be valid or binding unless and until accepted
by Landlord in writing.
(i) All references in this Lease to "the date hereof" or
similar referenced shall be deemed to refer to the last date, in point of time,
on which all parties hereto have executed this Lease.
(j) It is expressly stipulated and agreed that none of the
obligations to be undertaken by Landlord hereunder shall constitute any form of
warranty, express or implied, all such obligations being contractual covenants
of performance. Without limiting the generality of the foregoing, THERE IS NO
WARRANTY AS TO SUITABILITY, HABITABILITY, MERCHANTABILITY OR FITNESS FOR ANY
PARTICULAR PURPOSE GIVEN IN CONNECTION WITH THIS LEASE. This disclaimer of
express and implied warranties and the provisions of Paragraph 8 under which
Tenant assumes responsibility for repairs, are provisions bargained for by the
parties entering into this Lease. Were warranties undertaken by the Landlord
hereunder or were the Landlord agrees to perform repairs beyond that
contemplated to be performed by Landlord hereunder, the economics of this Lease
would have been affected and it would require an increase in Minimum Rent from
that payable hereunder.
(k) Tenant agrees to comply with all requirements of the
Americans with Disabilities Act (Public Law (July 26, 1990) applicable to the
Leased Premises and such other current acts or other subsequent acts, (whether
federal or state) addressing like issues as are enacted or amended. Tenant
agrees to indemnify and hold Landlord harmless for, from and against any and all
expenses, liabilities, costs or damages suffered by Landlord as a result of
additional obligations which may be imposed on the Building, or the Property
under of such acts by virtue of Tenant's operations and/or occupancy, including
the alleged negligence of the Landlord. Tenant acknowledges that it will be
wholly responsible for any provision of the Lease which could arguably be
construed as authorizing a violation of any act. Any such provision shall be
interpreted in a manner which permits compliance with such act and is hereby
amended to permit such compliance.
(l) In the event either party defaults in the performance of
any of the terms of this Lease and the other party employs an attorney in
connection therewith, the defaulting party agrees to pay the other party's
reasonable attorneys' fees.
(m) Whenever a period of time is herein prescribed for the
taking of any action by Landlord, Landlord shall not be liable or responsible
for, and there shall be excluded from the computation of such period of time,
any delays due to strikes, riots, acts of God, shortages of labor or materials,
20
war, governmental laws, regulations or restrictions, or any other cause
whatsoever beyond the control of Landlord.
(n) Except as expressly otherwise herein provided, with
respect to all required acts of Tenant, time is of the essence of this Lease.
(o) Landlord and Tenant hereby indemnify and hold each other
harmless for, from and against any loss, claim, expense or liability with
respect to any commissions or brokerage fees claimed on account of the execution
and/or renewal of this Lease due to any action of the indemnifying party.
(p) Tenant acknowledges that the financial capability of
Tenant to perform its obligations hereunder is material to Landlord and that
Landlord would not enter into this Lease but for its belief, based on its review
of Tenant's financial statements, that Tenant is capable of performing such
financial obligations. Tenant hereby represents, warrants and certifies to
Landlord that its financial statements are true and correct in all material
respects. Tenant shall deliver upon request copies of its most current financial
statements.
(q) Landlord reserves the right from time to time to grant
easements, rights and dedications and establish restrictions that Landlord deems
necessary or desirable, and cause the recordation of plats and restrictions, so
long as such easements, rights, dedications, plats and restrictions do not
unreasonably interfere with the use of the Leased Premises by Tenant.
29. EXHIBITS AND ATTACHMENT. All Exhibits, attachments, riders and
addenda referred to in this Lease are incorporated in this Lease and made a part
hereof for all intents and purposes.
30. TENANT'S INDEMNITY. Tenant covenants and agrees to indemnify and
hold Landlord harmless for, from and against any and all costs, liability or
expense arising out of any claims of any person or persons, or imposed by reason
of any violation of law or ordinance on account of any occurrence in, upon or at
the Leased Premises, or resulting from the occupancy or use thereof by Tenant or
by any person or persons holding thereunder, or by reason of the use or misuse
of the parking area or any other common facility in the Building by Tenant or by
any person or persons holding or using the Leased Premises, or any part thereof,
under Tenant, including, without limitation, Tenant's customers, invitees,
agents, contractors, employees, servants, subtenants, assignees, licensees or
concessionaires. Such indemnity for the benefit of indemnitees shall be
enforceable even if indemnitees, or any one or more of them have or has caused
or participated in causing such liability and claims by their joint, concurrent
or comparative acts, negligent or intentional, or otherwise. Any indemnity
provision is intended to indemnify indemnitees against the consequences of their
own negligence or fault as provided above, including any so-called active
negligence, regardless of whether indemnitees and each of them is jointly,
comparatively or concurrently negligent with Tenant or with any other person.
Notwithstanding the terms of this Lease to the contrary, the terms of this
Paragraph shall survive the expiration or earlier termination of this Lease.
31. HAZARDOUS MATERIALS.
(a) Tenant shall not, without Landlord's prior written
content, cause or permit any Hazardous Materials (hereinafter defined) to be
stored, used or disposed of in or about the Leased Premises or Project by
Tenant, its agents, employees, contractors or invitees, nor shall the use which
Tenant makes of the Leased Premises result in any Hazardous Materials
21
Contamination (hereinafter defined). For purposes of this Lease, the following
terms shall have the meanings herein specified.
(i) "HAZARDOUS MATERIALS" shall mean (i) any
"hazardous waste" as defined by the Resource Conservation and Recovery Act of
1976 (42 U.S.C.A. xx.xx. 6901 et seq.), as amended from time to time, and
regulations promulgated thereunder ("RCRA"); (ii) any "hazardous substance" as
defined by the Comprehensive Environmental Response, Compensation and Liability
Act of 1980 (42 U.S.C.A. xx.xx. 9601 et seq.), as amended from time to time, and
regulations promulgated thereunder ("CERCLA"); (iii) any substance, material or
waste regulated under applicable state or local law, (iv) asbestos,
polychlorinated biphenyls or other substances specifically regulated under the
Toxic Substances Control Act (15 U.S.C. xx.xx. 2601 et seq.), as amended from
time to time, and regulations promulgated thereunder ("TSCA"); (v) pesticides
specifically regulated under the Federal Insecticide, Fungicide and Rodenticide
Act (7 U.S.C.A. xx.xx. 135 et seq.), as amended from time to time, and
regulations promulgated thereunder ("FIFRA"); (vi) storage tanks, whether or not
underground and whether empty, filled or partially filled with any substance;
(vii) the presence of oil, petroleum products, and their by-products; (viii) any
substance the presence of which in or about the Property is prohibited by any
governmental authority or which is hereafter classified by any governmental
authority as a hazardous or toxic waste, material, substance or similar
phraseology; and (ix) any other substance which by any governmental authority
requires special handling or notification of any governmental authority in its
collection, storage, treatment, or disposal.
(ii) "HAZARDOUS MATERIALS CONTAMINATION" shall mean
the spillage, leakage, emission or disposal of Hazardous Materials (whether
presently existing or hereafter occurring) in or about the buildings,
facilities, soil, groundwater, air or other elements in or about the Property or
any other property as a result of Hazardous Materials at any time emanating from
the Leased. Premises,
(b) Notwithstanding the foregoing, Tenant shall be permitted
to store, use and dispose of de minimis amounts of Hazardous Materials which are
incidental to Tenant's business so long as such amounts does not increase the
Landlord's insurance or change the occupancy class of the Building. Such
Hazardous Materials and all containers therefore, shall be stored, used and
disposed of in a manner that complies with all federal, state and local laws or
regulations applicable to such Hazardous Materials. Tenant shall be liable for
all costs and expenses related to the storage, use and disposal of such de
minimis amounts of Hazardous Materials incidental to Tenant's business and shall
indemnify, defend and hold Landlord harmless from any claims or liabilities
relating thereto.
(c) At the commencement of each "Lease Year" (the term "LEASE
YEAR" as used in this Lease shall mean any twelve (12) month period beginning
with the Commencement Date and each twelve (12) month period beginning on any
anniversary date thereof), Tenant small disclose to Landlord the names and
approximate amounts of all Hazardous Materials which Tenant intends to store,
use or dispose of in or about the Leased Premises in the coming Lease Year. In
addition, at the commencement of each Lease Year (beginning with the second
Lease Year), Tenant shall disclose to Landlord the names and amounts of all
Hazardous Materials that to Tenant's knowledge were actually stored, used or
disposed of in or about the Leased Premises, if such materials were not
previously identified to Landlord at the commencement of the previous Lease
Years.
22
(d) Tenant shall give written notice to Landlord immediately
upon Tenant's acquiring knowledge of the presence of any Hazardous Materials in
or about the Leased Premises (subject to the provisions of paragraph b. hereof)
or of any Hazardous Materials Contamination with a full description thereof.
Landlord shall have the right, but not the obligation, without in any way
limiting Landlord's other rights and remedies under the Lease, to enter onto the
Leased Premises or to take such other actions as it deems necessary or advisable
to cleanup, remove, resolve or minimize the impact of, or otherwise deal with,
any Hazardous Materials or Hazardous Materials Contamination on the Project
following receipt of any notice from any xxxxxx or entity asserting the
existence of any Hazardous Materials or Hazardous Materials Contamination
pertaining to the Leased premises or any part of the Project which, if true,
could result in an order, suit, imposition of a lien on the Project, or other
action and/or which, in Landlord's sole opinion, could jeopardize Landlord's
security under the Lease.
(e) TENANT HEREBY AGREES THAT TENANT SHALL DEFEND, INDEMNIFY
AND HOLD HARMLESS LANDLORD, ITS AGENTS AND EMPLOYEES FOR, FROM AND AGAINST ANY
CLAIMS, DEMANDS, PENALTIES, FINES, LIABILITIES, SETTLEMENTS, DAMAGES, COSTS OR
EXPENSES (INCLUDING WITHOUT LIMITATION, ATTORNEYS' AND CONSULTANTS' FEES, COURT
COSTS AND LITIGATI0N EXPENSES) OF WHATEVER KIND OR NATURE, KNOWN OR UNKNOWN,
CONTINGENT OR OTHERWISE, ARISING OUT OF OR IN ANY WAY RELATED TO (A) THE
PRESENCE, DISPOSAL, RELEASE OR THREATENED RELEASE AND SUBSEQUENT REMEDIATION OF
ANY HAZARDOUS MATERIALS OR ANY HAZARDOUS MATERIALS CONTAMINATION FROM THE LEASED
PREMISES; (B) ANY PERSONAL INJURY (INCLUDING WRONGFUL DEATH) OR PROPERTY DAMAGE
(REAL OR PERSONAL) ARISING OUT OF OR RELATED TO SUCH HAZARDOUS MATERIALS OR
HAZARDOUS MATERIALS CONTAMINATION; OR, (C) THE APPLICABILITY OF ANY LAWS
RELATING TO HAZARDOUS MATERIALS ON THE LEASED PREMISES OR CAUSED BY TENANT. THE
PROVISIONS OF THIS PARAGRAPH E SHALL BE IN ADDITION TO ANY OTHER OBLIGATIONS AND
LIABILITIES TENANT MAV HAVE TO LANDLORD AT LAW OR IN EQUITY AND SHALL SURVIVE
THE EXPIRATION OF THIS LEASE OR THE TERMINATION THEREOF. SUCH INDEMNITY FOR THE
BENEFIT OF INDEMNITEES SHALL BE ENFORCEABLE EVEN IF INDEMNITEES, OR ANY ONE OR
MORE OF THEM HAVE OR HAS CAUSED OR PARTICIPATED IN CAUSING SUCH LIABILITY AND
CLAIMS BY THEIR JOINT, CONCURRENT OR COMPARATIVE ACTS, NEGLIGENT OR INTENTIONAL,
OR OTHERWISE. ANY INDEMNITY PROVISION IS INTENDED TO INDEMNIFY INDEMITEES
AGAINST THE CONSEQUENCES OF THEIR OWN NEGLIGENCE OR FAULT AS PROVIDED ABOVE,
INCLUDING ANY SO-CALLED ACTIVE NEGLIGENCE, REGARDLESS OF WHETHER INDEMNITEES AND
EACH OF THEM IS JOINTLY, COMPARATIVELY OR CONCURRENTLY NEGLIGENT WITH TENANT OR
WITH ANY OTHER PERSON. NOTWITHSTANDING THE TERMS OF THIS LEASE TO THE CONTRARY,
THE TERMS OF THIS PARAGRAPH SHALL SURVIVE THE EXPIRATION OR EARLIER TERMINATION
OF THIS LEASE.
32. MITIGATION OF DAMAGES.
(a) GENERAL DUTY TO MITIGATE. Both Landlord and Tenant shall
each use commercially reasonable efforts to mitigate any damages resulting from
a default of the other party under this Lease.
(b) LANDLORD'S DUTY TO MITIGATE DAMAGES. Landlord's obligation
to mitigate damages after a default by Tenant under this Lease shall be
satisfied in full if Landlord undertakes to lease the Leased Premises to another
tenant (a "SUBSTITUTE TENANT") in accordance with the following criteria:
(i) Landlord shall have no obligation to solicit or
entertain negotiations with any other prospective tenants for the Leased
Premises until Landlord obtains full and complete possession of the Leased
Premises including, without limitation, the final and unappealable legal right
23
to possession and therefore the right to relet the Leased Premises free of any
claim of Tenant.
(ii) Landlord shall not be obligated to offer the
Leased Premises to a prospective tenant when other premises in the Project
suitable for that prospective tenant's use are (or soon will be) available.
(iii) Landlord shall not be obligated to lease the
Leased Premises to a Substitute Tenant for a rental less than the current fair
market rental then prevailing for similar office space in comparable
office/warehouse buildings in the same market area as the Project, nor shall
Landlord be obligated to enter into a new lease under other terms and conditions
that are unacceptable to Landlord under Landlord's then current leasing policies
for comparable space in the Project.
(iv) Landlord shall not be obligated to enter into a
lease with any proposed tenant whose use would:
A. Violate any restriction, covenant, or
requirement contained in the lease of another tenant of the Project;
B. Adversely affect the reputation of the
Project; or
C. Be incompatible with the operation of the
Project as a first-class office/warehouse building.
(v) Landlord shall not be obligated to enter into a
lease with any proposed Substitute Tenant which does not have, in Landlord's
reasonable opinion, sufficient financial resources or operating experience to
operate the Leased Premises in a first-class manner.
(vi) Landlord shall not be required to expend any
amount of money to alter, remodel, or otherwise make the Leased Premises
suitable for uses by a proposed Substitute Tenant unless:
A. Tenant pays any such sum to Landlord in
advance of Landlord's execution of a Substitute Lease with such Substitute
Tenant (which payment shall not be in lieu of any damages or other sums to which
Landlord may be entitled as a result of Tenant's default under this Lease); or
B. Landlord, in Landlord's sole discretion,
determines that any such expenditure is financially justified in connection with
entering into any such Substitute Lease.
(c) EFFECT OF RELEASING. Upon compliance with the above
criteria regarding the releasing of the Leased Premises after a default by
Tenant, Landlord shall be deemed to have fully satisfied Landlord's obligation
to mitigate damages under this Lease and under any law or judicial ruling in
effect on the date of this Lease or at the time of Tenant's default, and Tenant
waives and releases, to the fullest extent legally permissible, any right to
assert in any action by Landlord to enforce the terms of this Lease, any
defense, counterclaim, or rights of set off or recoupment respecting the
mitigation of damages by Landlord, unless and to the extent Landlord maliciously
or in bad faith fails to act in accordance with the requirements of this
Paragraph 32.
24
(d) TENANT'S RIGHTS. Tenant's right to seek damages from
Landlord as a result of a default by Landlord under this Lease, shall be
conditioned on Tenant taking all actions reasonably required, under the
circumstances, to minimize any loss or damage to Tenant's property or business,
or to any of Tenant's officers, employees, agents, invitees, or other third
parties that may be caused by any such default of Landlord.
33. SUBSTITUTION. Landlord, at its sole discretion, shall be entitled
to cause Tenant to relocate from the Premises to an alternate space, of
comparable size and tenant improvements (the "RELOCATION SPACE") within the
Building (or within a nearby building within the Project, at Landlord's
election) at anytime upon prior written notice to Tenant. The reasonable costs
actually incurred in connection with the physical relocation of the Tenant to
the Relocation Space shall be at the expense of Landlord or the third party
tenant replacing Tenant.
THE PARTIES EXECUTING this Lease represent and warrant that each such
party possesses all lawful rights and authority to enter into this Lease; that
there are no judgments, decrees, or outstanding orders of any court prohibiting
the execution of this Amendment; and that all required approvals, consents and
resolutions necessary to effectuate the terms and provisions of this Lease have
been obtained.
Executed on the dates indicated below. Effective on the latter of the
dates indicated below.
LANDLORD:
TRANSWESTERN HOHOKAM, L.L.C., A DELAWARE
Attest/Witness LIMITED LIABILITY COMPANY
/S/ ?????? By: /S/ XXXXXXX XXXXXXXXX
----------------------------------- -----------------------------------
Xxxxxxx XxXxxxxxx
Title: Administrative Assistant TRANSWESTERN INVESTMENT COMPANY,
----------------------------------- LLC, AS AGENT
Its: Vice President
Date: 7/6/99
-----------------------------------
TENANT:
-------
CPI DEVELOPMENT, INC., A CALIFORNIA
Attest/Witness CORPORATION
----------------------------------- By: /S/ XXX XXXXXXXX
-----------------------------------
Title: President Xxx Xxxxxxxx
-----------------------------
Its: President
Date: 6/08/99
-----------------------------------
00
Xxxxx xx Xxxxxxxxxx
Xxxxxx xx Xxx Xxxxxxxxxx
The foregoing instrument was acknowledged before me this 28th day of
June, 1999, by Xxx Xxxxxxxx, the President of CPI Development, Inc., a
California Corporation, on behalf of the ____________.
(Seal and Expiration Date)
------------------------------------
XXXXXXX X. XXXXXX /S/ XXXXXXX X. XXXXXX
COMMISSION # 1056609 -------------------------------------
[SEAL] NOTARY PUBLIC - CALIFORNIA Notary Public
SAN BERNARDINO COUNTY
MY COMM. EXPIRES JUL 27, 1999
-------------------------------------
State of Illinois
County of Xxxx
The foregoing instrument was acknowledged before me this 7th day of
July, 1999, by Xxxxxxx XxXxxxxxx, the Vice President of Transwestern Investment
Company, a limited liability company on behalf of the landlord.
(Seal and Expiration Date)
/S/ XXXXXX X XXXXXXXXXX
-------------------------------------
Notary Public
------------------------------------
OFFICIAL SEAL
XXXXXX X XXXXXXXXXX
NOTARY PUBLIC, STATE OF ILLINOIS
MY COMMISSION EXPIRES: 04/25/00
------------------------------------
26
