LEASE
OF
0000 XXXX XXXXXX XXXXXX
XXXX XXXX, XXXXXXXXXX
BY AND BETWEEN
CALIFORNIA PACIFIC COMMERCIAL CORPORATION,
A CALIFORNIA CORPORATION, LANDLORD
AND
CLONTECH LABORATORIES, INC.
A CALIFORNIA CORPORATION, TENANT
INDEX
PAGE
1. PREMISES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Description. . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Condition. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.3 Hazardous Substances . . . . . . . . . . . . . . . . . . . . . . . 1
2. TERM AND DELIVERY OF POSSESSION . . . . . . . . . . . . . . . . . . . . . 2
2.1 Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.2 Early Entry. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.3 Options to Renew . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.4 Option Not Assignable. . . . . . . . . . . . . . . . . . . . . . . 3
3. RENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3.1 Base Rent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3.2 Manner of Payment. . . . . . . . . . . . . . . . . . . . . . . . . 4
3.3 Late Payment Charge. . . . . . . . . . . . . . . . . . . . . . . . 4
4. SECURITY DEPOSIT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
5. TAXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
5.1 Tenant's Personal Property . . . . . . . . . . . . . . . . . . . . 5
5.2 Real Property Taxes. . . . . . . . . . . . . . . . . . . . . . . . 5
6. USE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
6.1 Permitted Uses . . . . . . . . . . . . . . . . . . . . . . . . . . 6
6.2 Compliance with Law. . . . . . . . . . . . . . . . . . . . . . . . 6
6.3 Restrictions on Use. . . . . . . . . . . . . . . . . . . . . . . . 7
6.4 Hazardous Substances . . . . . . . . . . . . . . . . . . . . . . . 7
(a) Reportable Uses Require Consent. . . . . . . . . . . . . . 7
(b) Duty to Inform . . . . . . . . . . . . . . . . . . . . . . 8
(c) Indemnification by Tenant. . . . . . . . . . . . . . . . . 8
(d) Indemnification by Landlord. . . . . . . . . . . . . . . . 9
7. MAINTENANCE AND REPAIRS . . . . . . . . . . . . . . . . . . . . . . . . . 9
7.1 Landlord's Obligations . . . . . . . . . . . . . . . . . . . . . . 9
7.2 Tenant's Obligations . . . . . . . . . . . . . . . . . . . . . . .10
7.3 Maintenance of Outside Areas . . . . . . . . . . . . . . . . . . .10
INDEX
(CONTINUED)
PAGE
8. ALTERATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
8.1 Landlord's Consent Required. . . . . . . . . . . . . . . . . . . .11
8.2 Plans and Permits. . . . . . . . . . . . . . . . . . . . . . . . .11
8.3 Construction Work Done by Tenant . . . . . . . . . . . . . . . . .11
8.4 Roof Repairs . . . . . . . . . . . . . . . . . . . . . . . . . . .12
8.5 Title to Alterations . . . . . . . . . . . . . . . . . . . . . . .12
8.6 Removal of Alterations . . . . . . . . . . . . . . . . . . . . . .12
9. MECHANICS' LIENS. . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
10. UTILITIES; SECURITY SERVICES. . . . . . . . . . . . . . . . . . . . . . .13
11. INDEMNITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13
11.1 Tenant Indemnification of Landlord . . . . . . . . . . . . . . . .13
11.2 Landlord Indemnification of Tenant . . . . . . . . . . . . . . . .13
12. WAIVER OF CLAIMS. . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
13. INSURANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
13.1 Tenant's Liability Insurance . . . . . . . . . . . . . . . . . . .14
13.2 Landlord's Liability Insurance . . . . . . . . . . . . . . . . . .14
13.3 Property Insurance . . . . . . . . . . . . . . . . . . . . . . . .15
13.4 Payment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
13.5 Insurance Policies . . . . . . . . . . . . . . . . . . . . . . . .15
13.6 Waiver of Subrogation. . . . . . . . . . . . . . . . . . . . . . .16
13.7 No Limitation of Liability . . . . . . . . . . . . . . . . . . . .16
14. DAMAGE OR DESTRUCTION . . . . . . . . . . . . . . . . . . . . . . . . . .16
14.1 Partial Damage-Insured . . . . . . . . . . . . . . . . . . . . . .16
14.2 Partial Damage-Uninsured . . . . . . . . . . . . . . . . . . . . .16
14.3 Total Destruction. . . . . . . . . . . . . . . . . . . . . . . . .17
14.4 Damage Near End of Term. . . . . . . . . . . . . . . . . . . . . .17
14.5 Abatement of Rent. . . . . . . . . . . . . . . . . . . . . . . . .17
14.6 Tenant's Property. . . . . . . . . . . . . . . . . . . . . . . . .18
14.7 Notice of Damage . . . . . . . . . . . . . . . . . . . . . . . . .18
14.8 Replacement Cost . . . . . . . . . . . . . . . . . . . . . . . . .18
14.9 Hazardous Substance Conditions . . . . . . . . . . . . . . . . . .18
14.10 Waiver of Statute. . . . . . . . . . . . . . . . . . . . . . . . .19
ii.
INDEX
(CONTINUED)
PAGE
15. CONDEMNATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19
15.1 Partial Taking . . . . . . . . . . . . . . . . . . . . . . . . . .19
15.2 Total Taking . . . . . . . . . . . . . . . . . . . . . . . . . . .19
15.3 Distribution of Award. . . . . . . . . . . . . . . . . . . . . . .19
15.4 Sale Under Threat of Condemnation. . . . . . . . . . . . . . . . .19
15.5 Waiver of Statutes . . . . . . . . . . . . . . . . . . . . . . . .19
16. ASSIGNMENT AND SUBLETTING . . . . . . . . . . . . . . . . . . . . . . . .20
16.1 Landlord's Consent Required. . . . . . . . . . . . . . . . . . . .20
16.2 Documentation. . . . . . . . . . . . . . . . . . . . . . . . . . .20
16.3 Terms and Conditions . . . . . . . . . . . . . . . . . . . . . . .20
16.4 Corporate Transactions Constituting Assignment . . . . . . . . . .21
16.5 Landlord's Remedies. . . . . . . . . . . . . . . . . . . . . . . .21
16.6 Encumbrances, Licenses and Concession Agreements . . . . . . . . .22
17. DEFAULT BY TENANT . . . . . . . . . . . . . . . . . . . . . . . . . . . .22
17.1 Event of Default . . . . . . . . . . . . . . . . . . . . . . . . .22
17.2 Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22
17.3 Landlord's Right to Perform Tenant's Obligations . . . . . . . . .24
17.4 Interest on Past Due Obligations . . . . . . . . . . . . . . . . .24
17.5 Additional Rent. . . . . . . . . . . . . . . . . . . . . . . . . .24
17.6 Remedies Not Exclusive . . . . . . . . . . . . . . . . . . . . . .24
18. DEFAULT BY LANDLORD . . . . . . . . . . . . . . . . . . . . . . . . . . .25
18.1 Cure Period. . . . . . . . . . . . . . . . . . . . . . . . . . . .25
18.2 Mortgagee Protection . . . . . . . . . . . . . . . . . . . . . . .25
18.3 Tenant's Right to Perform Certain of Landlord's
Obligations. . . . . . . . . . . . . . . . . . . . . . . . . . . .25
19. ADVERTISEMENTS AND SIGNS. . . . . . . . . . . . . . . . . . . . . . . . .25
20. ENTRY BY LANDLORD . . . . . . . . . . . . . . . . . . . . . . . . . . . .25
21. SUBORDINATION AND ATTORNMENT. . . . . . . . . . . . . . . . . . . . . . .26
21.1 Subordination. . . . . . . . . . . . . . . . . . . . . . . . . . .26
21.2 Attornment . . . . . . . . . . . . . . . . . . . . . . . . . . . .26
iii.
INDEX
(CONTINUED)
PAGE
22. ESTOPPEL CERTIFICATES AND FINANCIAL STATEMENTS. . . . . . . . . . . . . .26
23. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26
24. WAIVER. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27
25. NO ACCORD AND SATISFACTION. . . . . . . . . . . . . . . . . . . . . . . .27
26. ATTORNEYS' FEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27
27. SURRENDER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28
28. HOLDING OVER. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28
29. TRANSFER OF PREMISES BY LANDLORD. . . . . . . . . . . . . . . . . . . . .28
30. GENERAL PROVISIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . .29
30.1 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . .29
30.2 Time . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29
30.3 Captions . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29
30.4 California Law . . . . . . . . . . . . . . . . . . . . . . . . . .29
30.5 Gender; Singular and Plural. . . . . . . . . . . . . . . . . . . .29
30.6 Partial Invalidity . . . . . . . . . . . . . . . . . . . . . . . .29
30.7 No Warranties. . . . . . . . . . . . . . . . . . . . . . . . . . .29
30.8 Joint and Several Liability. . . . . . . . . . . . . . . . . . . .29
30.9 Successors and Assigns . . . . . . . . . . . . . . . . . . . . . .29
30.10 Rules and Regulations. . . . . . . . . . . . . . . . . . . . . . .30
30.11 Authority. . . . . . . . . . . . . . . . . . . . . . . . . . . . .30
30.12 Memorandum of Lease. . . . . . . . . . . . . . . . . . . . . . . .30
30.13 Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30
30.14 Real Estate Brokers. . . . . . . . . . . . . . . . . . . . . . . .30
30.15 Limitation on Liability. . . . . . . . . . . . . . . . . . . . . .30
30.16 Quiet Enjoyment. . . . . . . . . . . . . . . . . . . . . . . . . .30
31. INITIAL IMPROVEMENTS TO PREMISES. . . . . . . . . . . . . . . . . . . . .30
31.1 Landlord's Improvements. . . . . . . . . . . . . . . . . . . . . .30
31.2 Tenant's Improvements. . . . . . . . . . . . . . . . . . . . . . .31
31.3 Improvement Allowance. . . . . . . . . . . . . . . . . . . . . . .31
iv.
INDEX
(CONTINUED)
PAGE
32. RIGHT OF FIRST OPPORTUNITY. . . . . . . . . . . . . . . . . . . . . . . .32
32.1 Sale of Premises . . . . . . . . . . . . . . . . . . . . . . . . .32
32.2 Lease of Adjacent Parcel . . . . . . . . . . . . . . . . . . . . .32
32.3 Rights Not Assignable. . . . . . . . . . . . . . . . . . . . . . .33
32.4 Additional Limitation on Rights. . . . . . . . . . . . . . . . . .33
33. CONDITION SUBSEQUENT. . . . . . . . . . . . . . . . . . . . . . . . . . .33
EXHIBITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34
v.
LEASE
This Lease, dated September 15, 1994, is made and entered into by and
between CALIFORNIA PACIFIC COMMERCIAL CORPORATION, a California corporation
("Landlord"), and CLONTECH LABORATORIES, INC., a California corporation
("Tenant").
Landlord and Tenant agree as follows:
1. PREMISES.
1.1 DESCRIPTION. Landlord hereby leases to Tenant and Tenant
hereby leases from Landlord for the term, at the rental, and upon all of the
other terms, covenants and conditions set forth herein, the real property
commonly referred to as 0000 Xxxx Xxxxxx Xxxxxx, Xxxx xx Xxxx Xxxx, Xxxxxx of
Santa Xxxxx, State of California, and more particularly described as Exhibit "A"
attached hereto and incorporated herein by reference (the "premises"). The
premises consist of a single-story concrete tilt-up building containing
approximately 36,960 square feet of floor space (the "Building") situated upon a
parcel of land containing approximately 115,956 square feet. The foregoing
statements regarding size are approximations which the parties agree are
reasonable and the rental based thereon is not subject to revision in the event
that the actual size differs from the approximations. The entire premises shall
be under the exclusive control of Tenant throughout the term of this Lease. The
portion of the parcel of land described above not covered by the Building is
hereafter called the "Outside Areas."
1.2 CONDITION. Landlord represents and warrants to Tenant that as
of the Commencement Date (as defined in paragraph 2.1): (i) to the best of its
knowledge, without investigation, the improvements on the premises comply with
Applicable Law (as defined in paragraph 6.2) in effect as of said date,
including, without limitation, laws regarding seismic safety; (ii) the Building
does not contain any asbestos; (iii) to the best of its knowledge, without
investigation, there are no Hazardous Substances on the Property except as
disclosed in the letter identified in paragraph 1.3 below and the study
referenced therein and there is no underground storage tank on the Property; and
(iv) to the best of its knowledge, without investigation, the Building does not
have any structural defects. Specifically excluded from the foregoing
representations and warranties are the Tenant Improvements (as defined in
paragraph 31.3) and any actions taken by or on behalf of Tenant. Except as
expressly provided herein, Landlord makes no representations or warranty
whatsoever with respect to the condition of the premises (including but not
limited to the electrical and fire sprinkler systems, security, environmental
aspects and compliance with applicable laws), the suitability of the premises
for Tenant's intended use or that any utility services provided to the premises
are in form or amount suitable for Tenant's use.
1.3 HAZARDOUS SUBSTANCES. Except as provided in paragraph 1.2
above and as referenced in that certain letter dated July 20, 1994 from United
Soil Engineering, Inc., a copy of which is attached hereto as Exhibit "B",
Landlord hereby represents and warrants to Tenant that Landlord has not received
any notification that the premises are in violation of any Applicable Laws (as
defined in paragraph 6.2) relating to the storage, use, or disposal of any
Hazardous Substance (as defined in paragraph 6.4) and has no notice of any
claims, actions, proceedings or suits, government or otherwise, pending or
threatened regarding the same.
1.
2. TERM AND DELIVERY OF POSSESSION.
2.1 TERM. The term of this Lease shall be for a period of
one-hundred twenty (120) months, commencing upon the earlier of May 1, 1995, or
the date that Tenant commences occupancy of the premises for the uses set forth
in paragraph 6.1 (the "Commencement Date"), and ending at midnight on the date
which is one hundred twenty (120) months after the Commencement Date, unless
sooner terminated pursuant to the provisions hereof. The Commencement Date
shall be delayed as follows: (i) in the event that the City of Palo Alto takes
more than 60 days from the date of submission to approve Tenant's plans for its
initial interior improvements (it being understood that permits for exterior
modifications are excluded from this provision) and Tenant is making diligent
efforts to get such plans approved, the Commencement Date shall be delayed by
the number of days beyond said 60 days which it takes to obtain such approval,
not to exceed a total of 60 days; and (ii) in the event that Xxxxx X. Xxxxx &
Sons, Inc. ("Xxxxx") takes longer than one hundred fifty (150) days from the
date of its commencement of work on Tenant's initial improvements to
substantially complete its work on Tenant's initial improvements and such delay
is attributable to Xxxxx or its subcontractors and not Tenant, the Commencement
Date shall be delayed by the number of days beyond said 150 days which it takes
Xxxxx to complete its work. In the event that Tenant does not have its
completed plans and specifications to Xxxxx for bid by October 10, 1994, there
shall be offset against any delay in the Commencement Date in accordance with
the preceding sentence the number of days between October 10, 1994 and the date
Tenant submits such plans and specifications to Xxxxx. Landlord and Tenant
shall execute and deliver to each other a letter acknowledging the Commencement
Date within thirty (30) days of said date. Landlord shall deliver possession of
the premises to Tenant no later than January 15, 1995 (the "Delivery Date"). If
Landlord is unable to deliver possession of the premises as of January 15, 1995,
Landlord shall not be liable for any damage caused for failing to deliver
possession, and this lease shall not be void or voidable. The Commencement Date
shall be delayed by the same number of days as the delay in the Delivery Date.
2.2 EARLY ENTRY. Tenant's occupancy of the premises prior to the
Commencement Date for the purpose of constructing the improvements (as defined
in paragraph 32.2) or for any other purpose permitted by Landlord shall be
subject to all of the terms and provisions hereof, except for the obligation to
pay rent which shall commence on the Commencement Date.
2.3 OPTIONS TO RENEW. Tenant shall have and is hereby granted one
(1) option to extend the term of this Lease for an additional period of five (5)
years. The option shall be exercisable by Tenant, provided Tenant is not then
in default hereunder, upon six (6) months written notice to Landlord prior to
the expiration of the initial Lease. The option period shall be upon the same
terms and conditions as set forth herein with respect to the initial term of
this Lease, except that: (a) the initial monthly base rental payable pursuant to
paragraph 3 during such option period shall be equal to the "market rate" (as
defined below) of the monthly base rental for comparable premises in the
immediate Palo Alto area prevailing at the commencement of such option period
and the base rent shall be increased on each anniversary of the commencement of
the lease term by four and one-half percent (4.5%) over the base rent payable
for the prior month; (b) Real Property Taxes payable by Tenant during the option
period shall include increases in Real Property Taxes resulting from a
reassessment following a change of
2.
ownership of the premises or any interest therein; and (c) there shall be no
additional option to extend. All references in this Lease to the term hereof
shall be construed to mean the initial term and such option period, unless the
context clearly indicates another meaning is intended.
The "market rate" shall be determined by agreement between Landlord
and Tenant. In determining the "market rate" all relevant factors shall be
taken into consideration, including, without limitation, the size and location
of the premises, the highest and best use of the premises (with or without the
then-existing improvements on the premises) and the quality and condition of the
improvements included in the premises; provided, however, that any of the trade
fixtures and any alterations, additions or improvements made to the premises by
Tenant at Tenant's cost and expense and which Tenant has the right to remove
upon expiration or termination of the Lease, shall not be taken into
consideration. If Landlord and Tenant cannot agree on an acceptable rent within
ten (10) days of receipt by Landlord of Tenant's notice to renew the Lease, then
each party shall promptly appoint an experienced real estate appraiser with at
least five (5) years experience appraising comparable properties in the Palo
Alto area who shall be a member of the American Institute of Real Estate
Appraisers ("AIREA") and such appraisers shall each determine the fair market
monthly Base Rent for the premises. Such appraisers shall, within twenty (20)
business days after their appointment, complete their appraisals and submit
their appraisal reports to Landlord and Tenant. If the fair market monthly Base
Rent of the premises established in the two (2) appraisals varies by five
percent (5%) or less of the higher rental, the average of the two shall be
controlling. If said fair market monthly Base Rent varies by more than five
percent (5%) of the higher rental, said appraisers, within ten (10) days after
submission of the last appraisal, shall appoint a third appraiser who shall be a
member of the AIREA. The appraisers shall arrange for a simultaneous delivery of
such determinations to the third appraiser. The role of the third appraiser
shall be to select which of the two proposed determinations most closely
approximates his determination of the fair market monthly Base Rent. The third
appraiser shall have no right to propose a middle ground or any modification of
either of the two proposed determinations. The determination he chooses as most
closely approximating his determination shall constitute the decision of the
appraisers and be final and binding upon the parties. Each party shall pay the
cost of its own appraiser and shall share the cost of the third appraiser, if
any. If either Landlord or Tenant fails to appoint an appraiser, or if an
appraiser appointed by either of them fails, after his appointment, to submit
his appraisal within the required period or if the two appraisers fail to
appoint a third appraiser within the required period, application shall be made
within twenty (20) days thereafter by either Landlord or Tenant to the AIREA,
which shall appoint a member of said institute willing to serve as appraiser.
In the event the appraisers have not determined the fair market
rental value as of the date for the rental adjustment, Tenant shall, on an
interim basis, pay Landlord monthly Base Rent based on the last monthly Base
Rent payable during the initial term. Upon the appraisers' determination,
Tenant shall be entitled to a credit against the next rental payment payable by
Tenant hereunder, or Tenant shall make an additional payment with the next
rental payable by Tenant hereunder, in the amount of such difference.
2.4 OPTION NOT ASSIGNABLE. The option granted to Tenant in this
Lease is personal to CLONTECH LABORATORIES, INC. ("Clontech"), and said option
is not assignable by Clontech either as a part of an assignment of this Lease or
separately or apart
3.
therefrom, and no option may be separated from this Lease in any manner by
reservation or otherwise; provided that said option may be assigned by Clontech
as part of the assignment of this Lease by Clontech (a) to a parent, subsidiary,
affiliate, division, or corporation controlling, controlled by or under common
control with Clontech, or (b) to a successor corporation of Clontech by merger,
consolidation or non-bankruptcy reorganization, or to a successor corporation
which purchases all or substantially all of the assets of Clontech, provided
that in each such case the assignee or successor entity expressly assumes and
agrees to perform for the benefit of Landlord all of the obligations of Tenant
hereunder.
3. RENT.
3.1 BASE RENT. Tenant shall pay to Landlord during the term of
this Lease monthly base rent (hereafter called "Base Rent"), in installments as
follows:
Month Base Rent Per Month
Months 1-6 $23,400.00
Months 7-12 $29,250.00
Months 13-24 $37,699.20
Months 25-36 $39,547.20
Months 37-48 $41,395.20
Months 49-60 $43,243.20
Months 61-72 $45,091.20
Months 73-84 $46,939.20
Months 85-96 $49,156.80
Months 97-108 $51,374.40
Months 109-120 $53,592.00
3.2 MANNER OF PAYMENT. Except as otherwise expressly provided
herein, Tenant shall pay to Landlord the rent, including the Base Rent
calculated as set forth above, without deduction, offset or abatement, and
without prior notice or demand, in advance commencing on the Commencement Date
and thereafter on the first day of each calendar month of the term of this
Lease. Rent shall be payable in lawful money of the United States to Landlord
at the address of Landlord set forth in paragraph 23 below or to such other
persons or at such other places as Landlord may from time to time designate in
writing. Tenant's obligation to pay rent for any partial month shall be
prorated on the basis of a thirty (30) day month.
3.3 LATE PAYMENT CHARGE. If any installment of rent or any other
sum due from Tenant is not received by Landlord within five (5) business days
after the due date, Tenant shall pay to Landlord an additional sum equal to five
percent (5%) of the amount overdue as a late charge, plus interest at the annual
rate of ten percent (10%).
4. SECURITY DEPOSIT. Upon execution of this Lease, Tenant shall deposit
with Landlord in cash the sum of Thirty Seven Thousand Dollars ($37,000) (the
"Deposit") as security for the faithful performance by Tenant of all of its
obligations hereunder. If Tenant fails to pay rent or any other sums due
hereunder (after notice and the right to cure as provided in paragraph 17), or
otherwise defaults with respect to any provision of this Lease, Landlord may
use, apply, or retain all or any portion of the Deposit for the payment of any
rent or other sum in
4.
default, or to compensate Landlord for the payment of any other sum which
Landlord may become obligated to spend by reason of Tenant's default, or to
compensate Landlord for any expenditure, loss or damage which Landlord may
suffer thereby. If Landlord so uses or applies all or any portion of the
Deposit, Tenant shall, within ten (10) days after written demand therefor,
deposit with Landlord an amount in cash sufficient to restore the Deposit to the
full amount hereinabove stated. Landlord shall not be required to keep the
Deposit separate from its general funds. The Deposit, less any portion thereof
which Landlord is entitled to retain, shall be returned without interest, to
Tenant within thirty (30) days after the later of the expiration of the term
hereof or the date on which Tenant vacates the premises.
5. TAXES.
5.1 TENANT'S PERSONAL PROPERTY. Tenant shall pay directly to the
charging authority prior to delinquency all taxes assessed against and levied
upon Tenant's leasehold improvements, trade fixtures, furnishings, equipment and
all other personal property and merchandise of Tenant situated in or about the
premises.
5.2 REAL PROPERTY TAXES.
(a) Tenant shall pay to Landlord all Real Property Taxes (as
hereinafter defined) levied with respect to the premises. Tenant shall pay
to Landlord all Real Property Taxes on or before the later of (1) twenty
(20) days prior to delinquency thereof, or (2) ten (10) days after the date
on which Tenant receives a copy of the tax xxxx or other reasonable
evidence of the amount of Real Property Taxes due and payable by Tenant
hereunder.
(b) The term "Real Property Taxes" as used herein shall mean
(i) all taxes, assessments, levies and other charges of any kind or nature
whatsoever, general and special, foreseen and unforeseen (including all
installments of principal and interest required to pay for any general or
special assessments for public improvements, services or benefits and any
increases resulting from reassessments caused by any new construction or
change in valuation), now or hereafter imposed by any governmental or
quasi-governmental authority or special district having the direct or
indirect power to tax or levy assessments, which are levied or assessed
against or with respect to (a) the value, occupancy or use of the premises
(as now constructed or as may at any time hereafter be constructed, altered
or otherwise changed), (b) the fixtures, equipment and other real or
personal property of Landlord that are an integral part of the premises, or
(c) the use of the Outside Areas, public utilities, or energy within the
premises; (ii) all charges, levies or fees imposed by reason of
environmental regulation or other governmental control of the premises; and
(iii) any new excise, transaction, sales, privilege, or other tax now or
hereafter imposed upon Landlord as a result of this Lease.
If at any time during the lease term the taxation or
assessment of the premises prevailing as of the Commencement Date shall be
altered so that in lieu of or in addition to any Real Property Taxes
described above there shall be levied, assessed or imposed (whether by
reason of a change in the method of taxation or assessment, creation of a
new tax or charge or any other cause) an alternate, substitute or
additional
5.
tax or charge (i) on the value, use or occupancy of the premises, (ii) on
or measured by the gross receipts, income or rentals from the premises, or
on Landlord's business of leasing the premises, or (iii) computed in any
manner with respect to the operation of the premises, then any such tax or
charge, however designated, shall be included within the meaning of the
term "Real Property Taxes" for purposes of this Lease.
Notwithstanding the foregoing, the term "Real Property
Taxes" shall not include (1) estate, inheritance, transfer, gift or
franchise taxes of Landlord or the federal or state income tax imposed on
Landlord's income from all sources, or (2) during the initial ten (10) year
term of this Lease that portion of any increase in Real Property Taxes
assessed against the premises resulting solely from a reassessment
following any change of ownership of the premises occurring during the
initial ten (10) year term; provided that during any option extension
period "Real Property Taxes" shall include, without limitation, the portion
of any increase in Real Property Taxes resulting from a reassessment
following a change of ownership of the premises occurring either during the
initial term of this Lease or during the option extension period.
(c) Tenant's liability to pay Real Property Taxes shall be
prorated on the basis of a 365-day year to account for any fractional
portion of a fiscal tax year included in the lease term at the commencement
or expiration of the term.
(d) Upon Tenant's reasonable request, Landlord shall appeal
any tax assessment on Tenant's behalf at no charge to Tenant.
6. USE.
6.1 PERMITTED USES. The premises shall be used and occupied only
for the following purposes: administrative offices, bio-medical research and
development, assembly, manufacturing, sales and for any lawful purposes
incidental thereto which are permitted by applicable zoning ordinances, and for
no other use or purpose without Landlord's prior written consent.
6.2 COMPLIANCE WITH LAW. Tenant shall not use the premises or
suffer or permit anything to be done in or about the premises which will in any
way conflict with any law, statute, zoning restriction, ordinance or
governmental law, rule, regulation, permit or requirement of duly constituted
public authorities, covenants, easements and restrictions of record, permits or
the requirements of any applicable fire insurance underwriting or rating bureau
now or hereafter constituted relating in any manner to or affecting the
condition, use or occupancy of the premises as may now or hereafter be in
effect, including, without limitation, (i) the law commonly known as "The
Americans With Disabilities Act" ("ADA"), (ii) laws pertaining to industrial
hygiene and environmental conditions on, in, under or about the premises
(including soil and groundwater conditions); and (iii) laws pertaining to the
use, generation, manufacture, production, installation, maintenance, removal,
transportation, storage, spill or release of any Hazardous Substances as
hereinafter defined (collectively called "Applicable Law"). Tenant, at Tenant's
sole expense, shall promptly comply with all Applicable Laws including, without
limitation, capital improvements required as a result of Tenant's particular use
of the premises or as a result of improvements undertaken by Tenant to the
premises. Notwithstanding the
6.
foregoing, capital improvements (including, without limitation, capital
improvements required by ADA) not required as a result of Tenant's particular
use of the premises or as a result of improvements undertaken by Tenant to the
premises shall be Landlord's responsibility. Tenant shall pay Landlord as
additional rent on the first day of each month an amount equal to the monthly
cost of such improvements if the cost of such improvements were amortized in
accordance with standard accounting practice together with interest on the
unamortized balance at the Bank of America reference rate at the time such
improvements are constructed plus 2% per annum. Tenant shall, within five (5)
business days after receipt of Landlord's written request, provide Landlord with
copies of all documents and information, including, but not limited to, permits,
registrations, applications, reports and certificates, evidencing Tenant's
compliance with any Applicable Law specified by Landlord, and shall immediately
upon receipt, notify Landlord in writing (with copies of any documents involved)
of any threatened or actual claim, notice, citation, warning, complaint or
report pertaining to or involving failure by Tenant or the premises to comply
with any Applicable Law.
6.3 RESTRICTIONS ON USE. Tenant shall not use or permit the use of
the premises in any manner that will tend to create waste on the premises or
constitute a nuisance to, or disturb the quiet enjoyment of, any other occupant
or user of the Building or any adjoining building. Tenant shall not use any
apparatus, machinery or other equipment in or about the premises that may cause
substantial noise or vibration or overload existing electrical systems, or
otherwise place any unusual loads upon the floors, walls or ceilings of the
premises which may overload the premises or jeopardize the structural integrity
of the Building or any part thereof. Tenant shall not make any penetrations of
the roof or exterior of the Building without the prior written approval of
Landlord. No materials or articles of any nature shall be stored upon any
portion of the Outside Areas unless located within an enclosure approved by
Landlord which complies with the reasonable rules and regulations issued by
Landlord from time to time; provided, however, that Tenant shall have the right
to place a back-up generator and a portable storage trailer on the Outside Area
so long as Tenant complies with all Applicable Law with respect thereto. Tenant
shall not cause or permit any toxic wastes or by-products or other harmful
chemicals to be discharged into the plumbing or sewage system of the Building or
onto the land underlying or adjacent to the Building. Tenant shall neutralize,
by filtering or otherwise, all acidic, oily or otherwise toxic fumes or wastes
generated by Tenant's activities on the premises.
6.4 HAZARDOUS SUBSTANCES.
(a) REPORTABLE USES REQUIRE CONSENT. The term "Hazardous
Substance" as used in this Lease shall mean any product, substance,
chemical, material or waste whose presence, nature, quantity and/or
intensity of existence, use, manufacture, disposal, transportation, spill,
release or effect, either by itself or in combination with other materials
is either: (i) potentially injurious to the public health, safety or
welfare, the environment or the premises, (ii) regulated or monitored by
any governmental authority, or (iii) a basis for liability of Landlord to
any governmental agency or third party under any applicable statute or
common law theory. Hazardous Substance shall include, but not be limited
to any "hazardous substance" as defined in Section 101 of the Comprehensive
Environmental Response, Compensation and Liability Act. Tenant shall not
engage in any activity in, on or about the Premises which constitutes a
Reportable
7.
Use (as hereinafter defined) of Hazardous Substances without the express
prior written consent of Landlord and compliance in a timely manner (at
Tenant's sole cost and expense) with all Applicable Law. Tenant may give
Landlord notice of such use, and seek such consent, concurrently with
Tenant's periodic submission to the local fire department or other
governmental authority to which Tenant must report such use. "Reportable
Use" shall mean: (i) the installation or use of any above or below ground
storage tank, (ii) the generation, possession, storage, use, transportation
or disposal of a Hazardous Substance that requires a permit from, or with
respect to which a report, notice, registration or business plan is
required to be filed with, any governmental authority. Reportable Use
shall also include Tenant's being responsible for the presence in, on or
about the premises of a Hazardous Substance with respect to which any
Applicable Law requires that a notice be given to persons entering or
occupying the Premises or neighboring properties. Notwithstanding the
foregoing, Tenant may, without Landlord's prior consent, but in compliance
with all Applicable Law, use any ordinary and customary materials
reasonably required to be used by Tenant in the normal course of Tenant's
business permitted on the premises, so long as such use is not a Reportable
Use and does not expose the premises or neighboring properties to any
meaningful risk of contamination or damage or expose Landlord to any
liability therefor. In addition, Tenant may (but without any obligation to
do so) condition its consent to the use or presence of any Hazardous
Substance, activity or storage tank by Tenant upon Tenant's giving Landlord
such additional assurances as Landlord, in its reasonable discretion, deems
necessary to protect itself, the public, the premises and the environment
against damage, contamination or injury and/or liability therefrom or
therefor, including, but not limited to, the installation (and removal on
or before Lease expiration or earlier termination) of reasonably necessary
protective modifications to the premises (such as concrete encasements)
and/or the deposit of an additional Security Deposit under paragraph 4
hereof.
(b) DUTY TO INFORM. If either party knows, or has reasonable
cause to believe, that a Hazardous Substance, or a condition involving or
resulting from same, has come to be located in, on, under or about the
premises, other than as previously consented to by Landlord and Tenant,
such party shall immediately give written notice of such fact to the other
party. Each party shall also immediately give the other party a copy of
any statement, report, notice, registration, application, permit, business
plan, license, claim, action or proceeding given to, or received from, any
governmental authority or private party, or persons entering or occupying
the premises, concerning the presence, spill, release, discharge of, or
exposure to, any Hazardous Substance or contamination in, on, or about the
premises, including but not limited to all such documents as may be
involved in any Reportable Uses involving the premises.
(c) INDEMNIFICATION BY TENANT. Tenant shall be solely
responsible for and indemnify, protect, defend and hold Landlord, its
agents, employees and the premises, harmless from and against any and all
loss of rents and/or damages, losses, liabilities, judgments, costs,
claims, liens, expenses, penalties, permits and attorney's and consultant's
fees arising out of or involving any Hazardous Substance or storage tank
brought on the premises by or for Tenant or under Tenant's control,
(hereinafter referred to as "Claims") including, but not limited to, the
effects of any contamination or injury to
8.
person, property or the environment, and the cost of investigation
(including consultant's and attorney's fees and testing), removal,
remediation, restoration and/or abatement thereof, or of any contamination
therein involved. Tenant shall reimburse Landlord for: (i) losses in or
reductions to rental income resulting from Tenant's use, storage, or
disposal of Toxic Materials; and (ii) all costs of refitting or other
alternations to the premises necessitated by Tenant's use, storage, or
disposal of Toxic Materials including, without limitation, alterations
required to accommodate an alternate use of the premises. Tenant agrees to
defend all Claims on behalf of Landlord with counsel reasonably acceptable
to Landlord, and to pay all fees, costs, damages, or expenses relating to
or arising out of any Claim including reasonable attorneys' fees and costs.
Tenant shall further be solely responsible for and shall indemnify, defend,
and hold Landlord and its agents harmless from and against all Claims,
including reasonable attorneys' fees and costs, arising out of or in
connection with any removal, clean-up, or restoration work which is
required by any government agency having jurisdiction and which arises from
Tenant's storage, use, or disposal of Toxic Materials on the premises
during its tenancy. Tenant's obligations hereunder shall survive the
termination of this Lease. No termination, cancellation or release
agreement entered into by Landlord and Tenant shall release Tenant from its
obligations under this Lease with respect to Hazardous Substances or
storage tanks, unless specifically so agreed by Landlord in writing at the
time of such agreement.
(d) INDEMNIFICATION BY LANDLORD. Landlord shall be solely
responsible for and indemnify, protect, defend and hold Tenant and its
agents and employees harmless from and against any and all damages,
liabilities, judgments, costs, claims, liens, expenses, penalties, permits
and attorney's and consultant's fees arising out of or involving any
Hazardous Substance brought on the premises by or for Landlord or under
Landlord's control, (hereinafter referred to as "Claims") including, but
not limited to, the effects of any contamination or injury to person,
property or the environment created or suffered by Landlord. Landlord
agrees to defend all Claims on behalf of Tenant with counsel acceptable to
Tenant and to pay all fees, costs, damages, or expenses relating to or
arising out of any Claim including attorneys' fees and costs. Landlord's
obligations hereunder shall survive the termination of this Lease. No
termination, cancellation or release agreement entered into by Landlord and
Tenant shall release Landlord from its obligations under this Lease with
respect to Hazardous Substances unless specifically so agreed by Tenant in
writing at the time of such agreement.
7. MAINTENANCE AND REPAIRS.
7.1 LANDLORD'S OBLIGATIONS. Landlord shall keep in good condition,
order, and repair the foundation of the Building and the exterior roof of the
Building (except that Tenant shall repair at Tenant's expense any damage caused
by Tenant's activities on the roof, including, but not limited to, the
installation of air conditioning equipment and/or duct work, or other roof
penetrations, and improper flashing or caulking, and any damage to exposed air
conditioning equipment and duct work installed by or for Tenant). Landlord
shall exercise reasonable diligence in performing such repairs as soon as
practicable. However, Landlord shall have no obligation to make repairs under
this paragraph until a reasonable time after Landlord has reasonable knowledge
of the need for such repairs, or after Landlord's receipt of written
9.
notice from the Tenant of the need for such repairs. Except as otherwise
specifically provided herein, there shall be no abatement of rent or other sums
payable by Tenant prior to or during any repairs by Tenant or Landlord. Tenant
shall pay Landlord upon demand as additional rent an amount equal to the cost
incurred by Landlord under this paragraph 7.1; provided, however, that the cost
of any capital improvements shall be amortized over such period as Landlord
shall reasonably determine together with interest on the unamortized balance at
the Bank of America reference rate at the time such improvements are constructed
plus 2% per annum.
7.2 TENANT'S OBLIGATIONS. Tenant shall, at Tenant's expense, keep
in good and safe condition, order and repair the premises and every part
thereof, including, without limitation, all plumbing, heating, air conditioning,
ventilating, fire sprinklers, electrical and lighting facilities, systems,
appliances and equipment within the Premises; fixtures, exterior and interior
walls, floors, ceilings, windows, doors, entrances, all glass (including plate
glass) and skylights located within the premises. In keeping the premises in
good and safe condition, order and repair, Tenant shall exercise and perform
good maintenance practices. Specifically, and not by way of limitation, Tenant
shall at its expense maintain in full force at all times during the term of this
Lease: (i) a heating, ventilating and air conditioning ("HVAC") systems
preventive maintenance contract covering all HVAC systems servicing the
premises, which shall provide for and include, without limitation, replacement
of filters, oiling and lubricating of machinery, parts replacement, adjustment
of drive belts, oil changes, weather proofing of all exposed HVAC equipment and
ducts, and other preventive maintenance; (ii) a service contract for the washing
of all windows of the premises (both interior and exterior surfaces) which
provides for the periodic washing of all such windows (iii) a fire sprinkler
system, water flow and smoke alarm preventative maintenance contract covering
all sprinkler and smoke alarm systems services on the premises; and (iv) a
landscape maintenance agreement providing for the maintenance of the landscaping
and paved areas. All such agreements shall be with qualified service companies
or contractors satisfactory to both Landlord and Tenant and shall provide that
the services are performed on a regular basis satisfactory to both Landlord and
Tenant. All repairs required to be made shall be made promptly with new
materials of like kind and quality. Tenant shall not cause or permit any
Hazardous Substance to be spilled or released in, on, under or about the
premises (including through the plumbing or sanitary sewer system) and shall
promptly, at Tenant's expense, take all investigatory and/or remedial action
reasonably recommended, whether or not formally ordered or required, for the
cleanup of any contamination of, and for the maintenance, security and/or
monitoring of, the premises, the elements surrounding same, or neighboring
properties, that was caused or materially contributed to by Tenant, or
pertaining to or involving any Hazardous Substance and/or storage tank brought
onto the premises by or for Tenant or under its control.
7.3 MAINTENANCE OF OUTSIDE AREAS. Tenant shall maintain and
repair, at Tenant's expense, the Outside Areas, together with all facilities and
improvements now or hereafter located thereon, and together with all street
improvements or other improvements adjacent thereto as may be required from time
to time by governmental authority, including, without limitation, the following:
(a) landscaping maintenance and replacement; (b) cleaning and repairing concrete
walkways and patios; (c) sweeping and repairing paved parking areas; (d)
operating and maintaining all directional and security lighting, if any; (e)
maintaining all directional and security signs; (f) furnishing water for
landscaping; (g) pest control service; and (h) rental or depreciation on
maintenance and operating machinery. Such areas shall be
10.
maintained by Tenant at all times in a first class condition. Notwithstanding
the foregoing, Landlord shall be responsible for repaving the parking areas and
Tenant shall pay Landlord as additional rent on the first day of each month an
amount equal to the cost thereof amortized in accordance with standard
accounting practice together with interest on the unamortized balance at the
Bank of America reference rate at the time such work is undertaken plus 2% per
annum.
8. ALTERATIONS.
8.1 LANDLORD'S CONSENT REQUIRED. Tenant shall not, without
Landlord's prior written consent, which shall not be unreasonably withheld or
delayed, make any alterations, improvements, additions or utility installations
(collectively called "alterations") in, on or about the premises, except for
nonstructural alterations which do not decrease the value of the premises and
which in each case do not exceed Ten Thousand Dollars ($10,000) in cost. Any
non-structural alteration which exceeds the cost of Ten Thousand Dollars
($10,000), and any structural alteration, shall require Landlord's prior written
approval. As used in this paragraph 8.1, the term "utility installation" means
power panels, wiring, fluorescent fixtures, space heaters, conduits, air
conditioning and plumbing. If Tenant uses a contractor other than Xxxxx X.
Xxxxx & Sons, Inc. and the improvements are structural or cost more than Twenty
Five Thousand Dollars ($25,000), prior to construction or installation of any
alterations which require Landlord's prior written approval, Landlord may
require Tenant to provide Landlord, at Tenant's expense, a lien and completion
bond in an amount equal to the estimated cost of such alterations, to insure
Landlord against any liability for mechanic's and materialmen's liens and to
insure completion of the work. Should Tenant make any alterations which require
Landlord's prior written consent without obtaining such prior written consent,
Tenant shall upon demand by Landlord immediately remove the same and restore the
premises to its original condition before such alterations, all at Tenant's
expense.
8.2 PLANS AND PERMITS. Any alterations which Tenant shall desire
to make in or about the premises and which require the prior written consent of
Landlord shall be presented to Landlord in written form, with proposed detailed
plans and specifications therefor prepared at Tenant's sole expense. Landlord
shall give its written approval or disapproval thereof within ten (10) working
days after receipt by Landlord. If Landlord fails to give its written approval
or disapproval within said period of ten (10) working days, such alterations
shall be deemed approved by Landlord. Any consent by Landlord thereto shall be
deemed conditioned upon Tenant's acquisition of all permits required to make
such alteration from all appropriate governmental agencies, the furnishing of
copies thereof to Landlord prior to commencement of the work, and the compliance
by Tenant with all conditions of said permits in a prompt and expeditious
manner, all at Tenant's sole expense. Upon completion of any such alteration,
Tenant, at Tenant's sole cost, shall immediately deliver to Landlord "as-built"
plans and specifications therefor, or written confirmation that the alteration
has been completed consistent with the detailed plan previously provided to
Landlord.
8.3 CONSTRUCTION WORK DONE BY TENANT. All construction work
required or permitted to be done by Tenant shall be performed by a licensed
contractor in a prompt, diligent, and good and workmanlike manner and shall
conform in quality and design with the premises existing as of the date of
delivery of possession to Tenant, and shall not diminish the value of the
Building. In addition, all such construction work shall be performed in
compliance with all
11.
applicable statutes, ordinances, regulations, codes and orders of governmental
authorities and insurers of the premises. Tenant or its agents shall secure all
licenses and permits necessary therefor. Work, once started, shall be
diligently pursued through to completion in accordance with the plans and
specifications approved by Landlord. No changes shall be made to such plans and
specifications as approved without the prior approval of Landlord.
8.4 ROOF REPAIRS. All installation of air conditioning equipment
and duct work requiring penetration of the roof shall be properly flashed and
caulked. Any electrical or refrigeration conduits or other piping or materials
installed by Tenant in the Building shall be installed beneath the surface of
the roof (and not on the surface of the roof), and Tenant shall thereafter
repair and reroof the affected portions of the roof surface. Any equipment
placed by Tenant on the roof shall be elevated and supported by Tenant so as not
to inhibit drainage or Landlord's repair of the roof pursuant to paragraph 7.1.
8.5 TITLE TO ALTERATIONS. Unless Landlord requires the removal
thereof as set forth in paragraphs 8.1 or 8.6, any alterations which may be made
on the premises, shall become the property of Landlord upon installation or
construction thereof on the premises and shall remain upon and be surrendered
with the premises at the expiration or sooner termination of the term of this
Lease. Without limiting the generality of the foregoing, all heating, lighting,
electrical (including all wiring, conduits, main and subpanels), air
conditioning, partitioning, drapery, and carpet installations made by Tenant,
regardless of how affixed to the premises, together with all other alterations
that have become an integral part of the premises, shall be and become the
property of Landlord upon installation, and shall not be deemed trade fixtures,
and shall remain upon and be surrendered with the premises at the expiration or
sooner termination of this Lease. Notwithstanding the provisions of this
paragraph 8.5, Tenant's furnishings, trade fixtures, machinery and equipment,
other than that which is affixed to the premises so that it cannot be removed
without material damage to the premises, shall remain the property of Tenant and
may be removed by Tenant, provided Tenant at Tenant's expense immediately after
removal repairs any damage to the premises caused thereby.
8.6 REMOVAL OF ALTERATIONS. Except with respect to the initial
improvements being constructed by Tenant in accordance with paragraph 31, at the
time that Landlord consents to any alterations which require Landlord's prior
written consent pursuant to paragraph 8.1 above, or within fourteen (14) days
after the date on which Tenant informs Landlord in writing of alterations which
do not require Landlord's prior written consent pursuant to paragraph 8.1 above,
Landlord may elect, by written notice to Tenant, to require Tenant to remove any
alterations that Tenant has made to the premises and to restore the premises as
hereinafter provided. If Landlord so elects, Tenant shall, at its sole expense,
upon expiration of the lease term or within twenty (20) days after any sooner
termination thereof, remove such alterations, repair any damage occasioned
thereby, and restore the premises to the condition existing as of the
Commencement Date or such other condition as may reasonably be designated by
Landlord in its election. The obligations of Tenant set forth in this paragraph
shall survive the termination of this Lease.
9. MECHANICS' LIENS. Tenant shall pay when due all claims for labor or
materials furnished to or for Tenant at or for use in the premises, which claims
are or may be secured by any mechanic's or material man's lien against the
premises or any interest therein. Tenant shall
12.
give Landlord notice of the date of commencement of any work in the premises not
less than ten (10) days prior thereto, and Landlord shall have the right to post
notices of non-responsibility or similar notices in or on the premises in
connection therewith. If any such liens are filed, Landlord may, without
waiving its rights and remedies based on such breach by Tenant and without
releasing Tenant from any obligations, cause such liens to be released by any
means it deems proper, including payment in satisfaction of the claim giving
rise to such lien. Landlord may take such action no sooner than five (5)
business days after giving Tenant written notice of its election to do so.
Tenant shall pay to Landlord upon demand any sum paid by Landlord to remove such
liens together with Landlord's costs and attorneys' fees and interest at the
rate of ten percent (10%) per annum from the date of payment.
10. UTILITIES; SECURITY SERVICES. Tenant shall pay when due directly to
the charging authority all charges for water, gas, electricity, telephone,
refuse pickup, janitorial services and all other utilities and services supplied
or furnished to the premises during the term of this Lease, together with any
taxes thereon. In no event shall Landlord be liable to Tenant for interruption
of Tenant's business due to failure or interruption of any such utilities or
services, unless caused by the negligence or willful misconduct of Landlord.
Landlord shall not be responsible for providing security guards or other
security protection for all or any portion of the premises, and Tenant may at
its own expense provide or obtain such security services as Tenant may desire to
ensure the safety of the premises.
11. INDEMNITY.
11.1 TENANT INDEMNIFICATION OF LANDLORD. Tenant hereby indemnifies
Landlord and holds Landlord harmless from and against any and all claims for
damage, loss, expense or liability due to, but not limited to, bodily injury,
including death resulting at any time therefrom, and/or property damage, now or
hereafter arising from any act, work or things done or permitted to be done or
otherwise suffered, or any omission in or about the premises, by Tenant or by
any of Tenant's agents, employees, contractors or invitees, or from any breach
or default by Tenant in the performance of any obligation on the part of Tenant
to be performed under the terms of this Lease, except to the extent such damage,
loss, expense or liability is caused by the negligence or willful misconduct of
Landlord or its employees or agents or by any breach by Landlord of its
obligations hereunder. Tenant shall also indemnify Landlord from and against
all damage, loss, expense (including, without limitation, reasonable attorneys'
fees), and liability incurred or suffered by Landlord in the defense of or
arising out of or resulting from any such claim or any action or proceeding
brought thereon. In the event any action or proceeding shall be brought against
Landlord by reason of any such claim, Tenant upon notice from Landlord shall
defend the same at Tenant's expense by counsel reasonably satisfactory to
Landlord. The obligations of Tenant contained in this paragraph shall survive
the termination of this Lease.
11.2 LANDLORD INDEMNIFICATION OF TENANT. Landlord hereby
indemnifies Tenant and holds Tenant harmless from and against any and all claims
for damage, loss, expense or liability due to, but not limited to, bodily
injury, including death resulting at any time therefrom, and/or property damage,
now or hereafter arising from any act, work or things done or permitted to be
done or otherwise suffered, or any omission in or about the premises, by
Landlord or by any of Landlord's agents, employees, contractors or invitees, or
from any breach or default by Landlord in the performance of any obligation on
the part of Landlord to be
13.
performed under the terms of this Lease, except to the extent such damage, loss,
expense or liability is caused by the negligence or willful misconduct of Tenant
or its employees or agents or by any breach by Tenant of its obligations
hereunder; provided, however, that Landlord shall not be liable for (i) any
injury to Tenant's business or any loss of income therefrom; or (ii) any
property damage to Tenant's personal property on the premises resulting from
Landlord's performance of, or failure to perform, its maintenance and repair
obligations hereunder. Landlord shall also indemnify Tenant from and against
all damage, loss, expense (including, without limitation, reasonable attorneys'
fees), and liability incurred or suffered by Landlord in the defense of or
arising out of or resulting from any such claim or any action or proceeding
brought thereon. In the event any action or proceeding shall be brought against
Tenant by reason of any such claim, Landlord upon notice from Tenant shall
defend the same at Landlord's expense by counsel reasonably satisfactory to
Tenant. The obligations of Landlord contained in this paragraph shall survive
the termination of this Lease.
12. WAIVER OF CLAIMS. Tenant hereby waives any claims against Landlord
for injury to Tenant's business or any loss of income therefrom or for damage to
the goods, wares, merchandise or other property of Tenant, or for injury or
death of Tenant's agents, employees, invitees, or any other person in or about
the premises regardless of whether the same results from conditions existing
upon the premises or from other sources or places, and regardless of whether the
cause of such damage or injury or the means of repairing the same is
inaccessible to Tenant; however, such waiver shall not apply to claims arising
from Landlord's negligence or willful misconduct.
13. INSURANCE.
13.1 TENANT'S LIABILITY INSURANCE. Tenant shall, at Tenant's
expense, obtain and keep in force during the term of this Lease a policy of
comprehensive public liability insurance insuring Landlord and Tenant against
any liability arising out of the condition, use, occupancy or maintenance of the
premises. Such policy of insurance shall have a combined single limit for both
bodily injury and property damage in an amount not less than Three Million
Dollars ($3,000,000). No more often than every five years, Landlord may require
Tenant to increase the amount of such coverage if, in Landlord's opinion, the
amount of such coverage is no longer equal to prevailing standards. The policy
shall contain cross-liability endorsements and shall insure performance by
Tenant of the indemnity provisions of paragraph 11. The limits of said
insurance shall not, however, limit the liability of Tenant hereunder.
13.2 LANDLORD'S LIABILITY INSURANCE. Landlord may maintain a policy
or policies of comprehensive general liability insurance insuring Landlord (and
such other persons as may be designated by Landlord) against liability for
personal injury, bodily injury or death, and damage to property occurring or
resulting from an occurrence in, on or about the premises with a combined single
limit of not less than Three Million Dollars ($3,000,000), or such greater
coverage as Landlord may from time to time determine is reasonably necessary for
Landlord's protection.
14.
13.3 PROPERTY INSURANCE.
(a) Landlord shall obtain and keep in force during the term
of this Lease a policy or policies of insurance covering loss or damage to
the premises, but excluding coverage of merchandise, fixtures, equipment
and leasehold improvements of Tenant which are not considered part of the
real estate for insurance purposes, in the amount of the full replacement
value thereof, providing protection against all perils included within the
classification of fire, extended coverage, vandalism, malicious mischief,
special extended perils (all risk), including boiler and machinery coverage
and an inflation endorsement, and, at Landlord's option, flood and
earthquake. In addition, Landlord shall obtain and keep in force, during
the term of this Lease, a policy of rental loss insurance commencing on the
date of loss, with proceeds payable to Landlord, which insurance may also
cover all Real Property Taxes, insurance premiums, and other sums payable
by Tenant to Landlord hereunder for said period. The insurance coverage
may include sprinkler leakage insurance if the Building contains fire
sprinklers. Tenant shall have no interest in or right to the proceeds of
any such insurance carried by Landlord.
(b) Tenant shall, at Tenant's sole expense, obtain and keep
in force during the term of this Lease, a policy of fire and extended
coverage insurance including a standard "all risk" endorsement, and a
sprinkler leakage endorsement, insuring the inventory, fixtures, equipment,
personal property, and leasehold improvements and alterations of Tenant
within the premises for the full replacement value thereof, as the same may
increase from time to time due to inflation or otherwise. The proceeds
from any of such policies shall be used for the repair or replacement of
such items so insured and Landlord shall have no interest in the proceeds
of such insurance.
13.4 PAYMENT. Tenant shall pay to Landlord, during the term hereof,
within ten (10) days of presentation of an invoice by Landlord, the premiums for
the insurance obtained by Landlord pursuant to paragraphs 13.2 and 13.3(a);
provided, however, that Tenant shall pay fifty percent (50%) of the cost of the
premium for earthquake insurance, not to exceed $5,000 per year during the first
five years of the lease term, $10,000 per year during the second five years of
the lease term and $15,000 during the option period. Notwithstanding the
foregoing, Landlord may obtain liability insurance and property insurance for
the premises separately, or together with other buildings and improvements under
blanket policies of insurance. In the latter case, Tenant shall be liable for
only such portion of the premiums for such blanket policies as are allocable to
the premises, as reasonably determined by the insurer or Landlord. If the term
of this Lease does not expire concurrently with the expiration of the period
covered by such insurance, Tenant's liability for premiums shall be prorated on
an annual basis.
13.5 INSURANCE POLICIES. The insurance required to be obtained by
Tenant pursuant to paragraphs 13.1 and 13.3(b) shall be primary insurance and
(i) shall provide that the insurer shall be liable for the full amount of the
loss up to and including the total amount of liability set forth in the
declarations without the right of contribution from any other insurance coverage
of Landlord, (ii) shall be in a form satisfactory to Landlord, and (iii) shall
be carried with recognized companies admitted to do business in California. The
policy or policies, or duly executed certificates for them, shall be deposited
with Landlord on or prior to the Commencement Date. Each policy shall provide
for at least thirty (30) days prior written notice
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to Landlord of cancellation, non-renewal, or modification. At least thirty (30)
days before the expiration of any required insurance policy, Tenant shall
furnish Landlord with proof that a new policy has been issued, continuing in
force the insurance covered by the policy which is expiring. At the same time
Tenant shall furnish Landlord with reasonable evidence that all premiums for any
such new policy have been paid. Tenant shall not do or permit to be done
anything which shall invalidate any of the insurance policies referred to in
paragraphs 13.1, 13.2, and 13.3. Tenant shall indemnify and hold Landlord free
and harmless from and against any damage, loss, or liability which Landlord may
suffer or incur as a result of the non-renewal or cancellation of any insurance
coverage which Tenant is required to carry by the provisions of this Lease.
13.6 WAIVER OF SUBROGATION Tenant and Landlord each hereby waives
any and all rights of recovery against the other, or against the officers,
employees, agents and representatives of the other, for loss of or damage to the
property of the waiving party or the property of others under its control, where
such loss or damage is insured against under any insurance policy carried by
Landlord or Tenant and in force at the time of such loss or damage. Tenant and
Landlord shall, upon obtaining the policies of insurance required hereunder,
give notice to the insurance carrier or carriers that the foregoing mutual
waiver of subrogation is contained in this Lease. Landlord and Tenant shall use
their reasonable best efforts to have their respective insurance companies waive
any rights of subrogation that such companies may have against Landlord or
Tenant, as the case my be.
13.7 NO LIMITATION OF LIABILITY Landlord makes no representation
that the limits of liability specified to be carried by Tenant or Landlord under
the terms of this Lease are adequate to protect any party. If Tenant believes
that the insurance coverage required under this Lease is insufficient to
adequately protect Tenant, Tenant shall provide, at its own expense, such
additional insurance as Tenant deems adequate.
14. DAMAGE OR DESTRUCTION
14.1 PARTIAL DAMAGE-INSURED. Subject to the provisions of
paragraphs 14.3 and 14.4, if the premises or the Building, as the case may be,
are damaged to the extent of less than fifty percent (50%) of the then
replacement value thereof (excluding excavations and foundations with respect to
the Building) and such damage was caused by an act or casualty covered under an
insurance policy required to be maintained pursuant to paragraph 13.3(a),
Landlord shall cause such damage to be repaired as soon as reasonably possible
and this Lease shall continue in full force and effect.
14.2 PARTIAL DAMAGE-UNINSURED. Subject to the provisions of
paragraphs 14.3 and 14.4, if at any time during the term hereof the premises or
the Building, as the case may be, are damaged, and such damage was caused by an
act or casualty not covered under an insurance policy required to be maintained
by Landlord pursuant to paragraph 13.3(a), Landlord may at Landlord's option
either (i) repair such damage as soon as reasonably possible at Landlord's
expense, in which event this Lease shall continue in full force and effect, or
(ii) give written notice of termination of this Lease to Tenant within thirty
(30) days after the date of the occurrence of such damage, with the effective
date of such termination to be the date of the occurrence of such damage. In
the event Landlord gives such notice of termination of this Lease, Tenant shall
have the right, within ten (10) days after receipt of such notice, to agree in
writing
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on a basis satisfactory to Landlord to pay for the entire cost of repairing such
damage in which event the notice of termination shall be ineffective and this
Lease shall continue in full force and effect, and Landlord shall proceed to
make such repairs as soon as reasonably possible. If Tenant does not give such
notice within such ten (10) day period this Lease shall be terminated pursuant
to such notice of termination by Landlord. Notwithstanding Landlord's election
to repair such damage, Tenant shall have the right to terminate this Lease in
the event that the repair of the damage covered by this paragraph 14.2 can not
in Landlord's reasonable judgment be expected to be completed within two hundred
and seventy (270) days from the date of such damage. Tenant may exercise such
right only by written notice to Landlord delivered within thirty (30) days after
the date of the occurrence of such damage. Tenant shall also have the right to
terminate this lease in the event that the repair of the damage covered by this
paragraph 14.2 is not actually completed by the later of: (i) three hundred and
sixty days from the date of such damage; or (ii) seventy-five (75) days
following the date Landlord has notified Tenant it expects to complete such
repairs. Tenant may exercise such right only by written notice to Landlord
delivered within thirty (30) days after the date its right to terminate arises.
14.3 TOTAL DESTRUCTION. If at any time during the term hereof
either the premises or the Building is destroyed to the extent of fifty percent
(50%) or more of the then replacement value thereof (excluding excavations and
foundations with respect to the Building), from any cause, whether or not
covered by the insurance maintained by Landlord pursuant to paragraph 14.3(a),
this Lease shall at the option of either Landlord or Tenant terminate as of the
date of such destruction. The right to terminate this Lease may be exercised
within thirty (30) days after the date that Tenant notifies Landlord of the
occurrence of such damage. In the event that neither party elects to terminate
this Lease, Landlord shall at Landlord's expense repair such damage as soon as
reasonably possible, and this Lease shall continue in full force and effect.
14.4 DAMAGE NEAR END OF TERM. If the premises or the Building, as
the case may be, is destroyed or damaged in whole or in part to the extent of
One Hundred Thousand Dollars ($100,000) or more, whether from an insured or
uninsured casualty, during the last six (6) months of the term of this Lease,
Landlord or Tenant may cancel and terminate this Lease as of the date of
occurrence of such damage by giving written notice to the other party of its
election to do so within thirty (30) days after the date of occurrence of such
damage. This paragraph 14.4 shall not apply during the last six (6) months of
the initial term in the event that Tenant has validly exercised its option to
renew in accordance with paragraph 2.3 above.
14.5 ABATEMENT OF RENT. Notwithstanding anything to the contrary
contained in paragraph 3 or elsewhere in this Lease, if the premises are
partially damaged and Landlord repairs or restores them pursuant to the
provisions of this paragraph 14, the rent, including Tenant's obligation to pay
Real Property Taxes and insurance premiums, payable hereunder for the period
commencing on the occurrence of such damage and ending upon completion of such
repair or restoration shall be abated in proportion to the extent to which
Tenant's use of the premises is impaired during the period of repair; provided
that nothing herein shall be construed to preclude Landlord from being entitled
to collect the full amount of any rental loss insurance proceeds. Except for
abatement of rent, if any, Tenant shall have no claim against Landlord for any
damage suffered by reason of any such damage, destruction, repair or
restoration.
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14.6 TENANT'S PROPERTY. Landlord's obligation to rebuild or restore
shall not include restoration of Tenant's trade fixtures, equipment,
merchandise, or any improvements, alterations or additions made by Tenant to the
premises.
14.7 NOTICE OF DAMAGE. Tenant shall notify Landlord within ten (10)
days after the occurrence thereof of any damage to all or any portion of the
premises. In no event shall Landlord have any obligation to repair or restore
the premises pursuant to this paragraph 14 until a reasonable period of time
after Landlord has reasonable knowledge of the need for such repairs or after
Landlord's receipt of notice from Tenant of the nature and scope of any damage
to the premises, and a reasonable period of time to collect insurance proceeds
arising from such damage (unless such damage is clearly not covered by insurance
then in effect covering the premises), not to exceed one hundred and eighty
(180) days.
14.8 REPLACEMENT COST. The reasonable determination in good faith
by Landlord of the estimated cost of repair of any damage or of the replacement
cost shall be conclusive for purposes of this paragraph 14, unless Tenant can
show otherwise.
14.9 HAZARDOUS SUBSTANCE CONDITIONS. If a Hazardous Substance
Condition occurs, unless Tenant is legally responsible therefor (in which case
Tenant shall make the investigation and remediation thereof required by
Applicable Law and this Lease shall continue in full force and effect, but
subject to Landlord's rights under paragraph 17), Landlord may at Landlord's
option either: (i) investigate and remediate such Hazardous Substance
Condition, if required, as soon as reasonably possible at Landlord's expense, in
which event this Lease shall continue in full force and effect, or (ii) if the
estimated cost to investigate and remediate such condition exceeds six (6) times
the then monthly Base Rent or $100,000, whichever is greater, give written
notice to Tenant within thirty (30) days after receipt by Landlord of knowledge
of the occurrence of such Hazardous Substance Condition of Landlord's desire to
terminate this Lease as of the date sixty (60) days following the giving of such
notice. In the event Landlord elects to give such notice of Landlord's
intention to terminate this Lease, Tenant shall have the right within ten (10)
days after the receipt of such notice to give written notice to Landlord of
Tenant's commitment to pay for the investigation and remediation of such
Hazardous Substance Condition totally at Tenant's expense and without
reimbursement from Landlord except to the extent of an amount equal to six (6)
times the then monthly Base Rent or $100,000, whichever is greater. Tenant
shall provide Landlord with the fund required of Tenant or satisfactory
assurance thereof within thirty (30) days following Tenant's said commitment.
In such event this Lease shall continue in full force and effect, and Landlord
shall proceed to make such investigation and remediation as soon as reasonably
possible and the required funds are available. If Tenant does not give such
notice and provide the required funds or assurance thereof within the times
specified above, this Lease shall terminate as of the date specified in
Landlord's notice of termination. If a Hazardous Substance Condition occurs for
which Tenant is not legally responsible there shall be abatement of Tenant's
obligations under this Lease to the same extent as provided in paragraph 14.5
for a period of not to exceed twelve (12) months. "Hazardous Substance
Condition" shall mean the occurrence or discovery of a condition involving the
presence of, or a contamination by, a Hazardous Substance in, on or under the
premises.
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14.10 WAIVER OF STATUTES. The terms of this Lease shall govern the
effect of any damage to or destruction of the Premises with respect to the
termination of this Lease. Landlord and Tenant hereby waive the provisions of
any present or future statute to the extent inconsistent herewith.
15. CONDEMNATION.
15.1 PARTIAL TAKING. Subject to the provisions of paragraph 15.2,
if part of the premises is taken for any public or quasi-public use, under any
statute or right of eminent domain (collectively a "taking"), and a part of the
premises remains which is reasonably suitable for Tenant's continued occupancy
for the uses permitted by this Lease, this Lease shall, as to the part so taken,
terminate as of the date the condemnor or purchaser takes possession of the
property being taken, and the rent payable hereunder shall be reduced based upon
the extent to which the partial taking shall interfere with the business carried
on by Tenant on the premises. Landlord shall, at its own cost and expense, make
all necessary repairs or alterations to the premises in order to make the
portion of the premises not taken a complete architectural unit; provided,
however, that Landlord shall not be required to repair or restore any injury or
damage to the property of Tenant or to make any repairs or restoration of any
alterations, additions, fixtures or improvements installed on the premises by or
at the expense of Tenant.
15.2 TOTAL TAKING. If twenty percent (20%) or more of the floor
area of the Building is taken, or more than fifty percent (50%) of the land area
is taken, or such part thereof is taken so that there does not remain a portion
of the premises suitable for Tenant's continued occupancy for the uses permitted
hereunder, such taking shall be treated as a total taking and this Lease shall
terminate upon the date possession shall be taken by the condemning authority.
15.3 DISTRIBUTION OF AWARD. If a part or all of the premises is
taken, all compensation awarded upon such taking shall belong to and be paid to
Landlord, except that Tenant shall receive from the award a sum attributable to
Tenant's improvements or alterations made to the premises by Tenant at Tenant's
expense with Landlord's consent in accordance with this Lease which Tenant has
the right to remove from the premises pursuant to the provisions of this Lease,
but elects not to remove; or, if Tenant elects to remove any such improvements
or alterations made to the premises at Tenant's expense, Tenant shall receive a
sum for reasonable removal and relocation costs not to exceed the market value
of such improvements or alterations on the date possession of the premises is
taken. Notwithstanding the foregoing, Tenant shall have the right to seek a
claim against the taking authority for interruption of or damage to its business
and loss of business goodwill.
15.4 SALE UNDER THREAT OF CONDEMNATION. A sale by Landlord to any
authority having the power of eminent domain, either under threat of
condemnation or while condemnation proceedings are pending, shall be deemed a
taking under the power of eminent domain for purposes of this paragraph 15.
15.5 WAIVER OF STATUTES. The terms of this Lease shall govern the
effect of any taking of the premises. Landlord and Tenant hereby waive the
provisions of any present or future statute to the extent inconsistent herewith.
19.
16. ASSIGNMENT AND SUBLETTING.
16.1 LANDLORD'S CONSENT REQUIRED. Tenant shall not assign this
Lease, or any interest therein, voluntarily or involuntarily, and shall not
sublet the premises or any part thereof, or any right or privilege appurtenant
thereto, or suffer any other person (the agents and servants of Tenant excepted)
to occupy or use the premises, or any portion thereof, without the prior written
consent of Landlord in each instance pursuant to the terms and conditions set
forth below, which consent shall not be unreasonably withheld or delayed.
16.2 DOCUMENTATION. Prior to any assignment or sublease which
Tenant desires to make, Tenant shall provide to Landlord: (i) the name and
address of the proposed assignee or sublessee, (ii) true and complete copies of
all documents relating to Tenant's prospective agreement to assign or sublease,
(iii) such other information as may be reasonably requested by Landlord, and
(iv) a document signed by Tenant and the proposed assignee or sublessee
specifying to Landlord's reasonable satisfaction all consideration to be
received by Tenant for such assignment or sublease in the form of lump sum
payments, installments of rent, or otherwise. For purposes of this paragraph
16, the term "consideration" shall include, without limitation, all monies or
other consideration of any kind, if such sums are related to Tenant's interest
in this Lease or in the premises, including but not limited to, bonus money, and
payments (in excess of book value thereof) for Tenant's assets, fixtures,
inventory, accounts, good will, equipment, furniture, general intangibles, and
any capital stock or other equity ownership of Tenant. Within ten (10) days
after the receipt of such written notice, Landlord shall either consent in
writing to such proposed assignment or sublease subject to the terms and
conditions hereinafter set forth, or notify Tenant in writing that Landlord
refuses such consent, specifying reasonable grounds for such refusal.
16.3 TERMS AND CONDITIONS. As a condition to Landlord's granting
its consent to any assignment or sublease, Landlord may require that (i) Tenant
pay to Landlord, as and when received by Tenant, one-half of the amount of any
excess of such consideration to be received by Tenant in connection with said
assignment or subletting, over and above the base rent, and all other sums
payable by Tenant to Landlord under the terms of this Lease; provided that
Tenant shall first be entitled to retain an amount of such excess consideration
equal to Tenant's reasonable direct costs of assigning or subletting, including,
without limitation, real estate brokerage commissions and concessions made to
the subtenant, if any, but not to exceed in the aggregate an amount equal to six
months' Base Rent, and (ii) Tenant and the proposed assignee or sublessee
demonstrate to Landlord's reasonable satisfaction that the assignee or sublessee
proposes to use the premises for substantially the same use or a use which is
otherwise satisfactory to Landlord, and the proposed use is not injurious to the
premises. Each assignment or sublease agreement to which Landlord has consented
shall be an instrument in writing in form satisfactory to Landlord, and shall be
executed by both Tenant and the assignee or sublessee, as the case may be. Each
such assignment or sublease agreement shall recite that it is and shall be
subject and subordinate to the provisions of this Lease, that the assignee or
sublessee accepts such assignment or sublease and agrees to perform all of the
obligations of Tenant hereunder, and that the termination of this Lease shall,
at Landlord's sole election, constitute a termination of every such assignment
or sublease. In the event Landlord shall consent to an assignment or sublease,
Tenant shall nonetheless remain liable for all obligations and liabilities of
Tenant under this Lease, including, but not limited to, the payment of rent.
The consent by Landlord to any
20.
assignment or sublease shall not constitute a waiver of the provisions of this
paragraph 16, including the requirement of Landlord's prior written consent,
with respect to any subsequent assignment or sublease. Tenant agrees to
reimburse Landlord upon demand for reasonable attorneys' fees incurred by
Landlord in connection with the negotiation, review, and documentation of any
such requested assignment or subleasing, but not to exceed the sum of One
Thousand Dollars ($1,000) in any transaction.
16.4 CORPORATE TRANSACTIONS CONSTITUTING ASSIGNMENT.
(a) Any dissolution, or the transfer either all at once or in
a series of related transfers, of a controlling percentage of the capital
stock of Tenant, or the sale, or series of sales of all or substantially
all of Tenant's assets located in, on, or about the premises, shall be
deemed an assignment. The phrase "controlling percentage" means the
ownership of, and the right to vote, stock possessing at least fifty
percent (50%) of the total combined voting power of all classes of Tenant's
capital stock issued, outstanding and entitled to vote for the election of
directors. Notwithstanding the foregoing, Tenant shall have the right to
assign, sublease or transfer to a subsidiary, parent or affiliated company,
or to a successor by merger, subject to the provisions of subparagraph 9(c)
below.
(b) Any such assignment or subletting described in
subparagraph (a) above shall be subject to the provisions for assignment
and subletting set forth in this paragraph 16.
(c) Notwithstanding the foregoing, Tenant may, without
Landlord's prior written consent and without any participation by Landlord
in assignment and subletting proceeds, sublet the premises or assign this
Lease to: (i) a subsidiary, affiliate, division, corporation, joint venture
or strategic partnership controlled or under common control with Tenant;
(ii) a successor corporation related to Tenant by merger, consolidation or
non-bankruptcy reorganization; or (iii) a purchaser of substantially all of
Tenant's assets. Tenant's foregoing rights to assign this Lease shall be
subject to the following conditions: (i) Tenant shall not be in default
hereunder; (ii) the transferee or successor entity shall expressly assume
Tenant's obligations hereunder; (iii) Tenant shall remain liable for all
obligations and liabilities of Tenant under this Lease; and (iv) the entity
to which the Lease is assigned or subleased has a net worth as of the date
of such assignment equal to at least the greater of the net worth of Tenant
as of the date of this Lease or as of the date immediately preceding such
assignment or sublease. Tenant and the proposed assignee or sublessee
shall provide such documentation as may be requested by Landlord to
demonstrate to Landlord's reasonable satisfaction that the condition set
forth in (iv) above has been satisfied. For the purposes of this Lease,
the sale of Tenant's capital stock through any public offering shall not be
deemed an assignment, subletting, or any other transfer of the Lease or the
premises.
16.5 LANDLORD'S REMEDIES. Any assignment or sublease without
Landlord's prior written consent shall at Landlord's election be void, and shall
constitute a default. If Tenant shall purport to assign this Lease, or sublease
all or any portion of the premises, or permit any person or persons other than
Tenant to occupy the premises without Landlord's prior written
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consent, Landlord may collect rent from the person or persons then or thereafter
occupying the premises and apply the net amount collected to the rent reserved
herein, but no such collection shall be deemed a waiver of Landlord's rights and
remedies under this paragraph 16, or the acceptance of any such purported
assignee, sublessee or occupant, or a release of Tenant from the further
performance by Tenant of covenants on the part of Tenant herein contained.
16.6 ENCUMBRANCES, LICENSES AND CONCESSION AGREEMENTS. Tenant shall
not encumber its interest under this Lease or any rights of Tenant hereunder, or
enter into any license or concession agreement respecting all or any portion of
the premises, without Landlord's prior written consent which consent shall not
unreasonably be withheld or delayed subject to the terms and conditions referred
to in paragraph 16.2 above, and Tenant's granting of any such encumbrance,
license, or concession agreement shall constitute an assignment for purposes of
this paragraph 16.
17. DEFAULT BY TENANT.
17.1 EVENT OF DEFAULT. The occurrence of any one or more of the
following events (an "Event of Default") shall constitute a default and breach
of this Lease by Tenant:
(a) The failure by Tenant to make any payment of rent or any
other payment required to be made by Tenant hereunder, as and when due, and
such failure shall not have been cured within ten (10) days after Tenant
receives written notice thereof from Landlord; provided that, if three or
more such failures shall occur during the lease term, then each and every
succeeding failure to pay any sum payable hereunder when due shall
constitute an Event of Default, and Tenant shall be entitled to a five (5)
day cure period or notice from Landlord with respect to any such failure to
pay; or
(b) Tenant's failure to perform any other term, covenant or
condition contained in this Lease and such failure shall have continued for
thirty (30) days after written notice of such failure is given to Tenant;
provided that, where such failure cannot reasonably be cured within said
thirty (30) day period, Tenant shall not be in default if Tenant commences
such cure within said thirty (30) day period and thereafter diligently
continues to pursue all reasonable efforts to complete said cure until
completion thereof. Said written notice shall constitute those required
under California Code of Civil Procedure, Section 1161, et seq.
17.2 REMEDIES. Upon any Event of Default, Landlord shall have the
following remedies in addition to all other rights and remedies provided by law
or equity:
(a) Landlord shall be entitled to keep this Lease in full
force and effect for so long as Landlord does not terminate Tenant's right
to possession (whether or not Tenant shall have abandoned the premises),
and Landlord may enforce all of its rights and remedies under this Lease,
including the right to recover rent and other sums as they become due under
this Lease; or
(b) Landlord may terminate the Tenant's right to possession
by giving Tenant thirty (30) days written notice of termination. Thirty
(30) days after the giving of the notice, this Lease and all of Tenant's
rights in the premises shall terminate. Any
22.
termination under this paragraph shall not release Tenant from the payment
of any sum then due Landlord or from any claim for damages or rent
previously accrued or then accruing against Tenant.
In the event this Lease is terminated pursuant to this
paragraph 17.2(b), Landlord may recover from Tenant:
(1) the worth at the time of award of the unpaid rent
which had been earned at the time of termination; plus
(2) the worth at the time of award of the amount by
which the unpaid rent which would have been earned after
termination until the time of award exceeds the amount of such
rental loss for the same period that Tenant proves could have
been reasonably avoided; plus
(3) the worth at the time of award of the amount by
which the unpaid rent for the balance of the term after the
time of award exceeds the amount of such rental loss for the
same period that Tenant proves could be reasonably avoided;
plus
(4) any other amount necessary to compensate Landlord
for all detriment proximately caused by Tenant's failure to
perform Tenant's obligations under this Lease, or which in the
ordinary course of things would be likely to result therefrom,
including without limitation, the following: (i) expenses for
cleaning, repairing or restoring the premises; (ii) costs
incurred as owner of the premises including without limitation
taxes and insurance premiums thereon, utilities and building
security; (iii) expenses in retaking possession of the
premises; and (iv) attorneys' fees and court costs.
The "worth at the time of award" of the amounts referred to in
subparagraphs (1) and (2) of this paragraph 17.2(b) shall be computed by
allowing interest at the greater of ten percent (10%) per annum, or (ii)
the maximum rate permitted by law. The "worth at the time of the award" of
the amount referred to in subparagraph (3) of this paragraph 17.2(b) shall
be computed by discounting such amount at the discount rate of the Federal
Reserve Bank of San Francisco at the time of the award plus one percent
(1%). The term "time of award" as used in subparagraphs (1), (2) and (3)
shall mean the date of entry of a judgment or award against Tenant in an
action or proceeding arising out of Tenant's breach of this Lease. The
term "rent" as used in this paragraph shall include all sums required to be
paid by Tenant to Landlord pursuant to the terms of this Lease.
(c) This Lease may be terminated by a judgment specifically
providing for termination, or by Landlord's delivery to Tenant of written
notice specifically terminating this Lease. In no event shall any one or
more of the following actions by Landlord, in the absence of a written
election by Landlord to terminate this
23.
Lease, constitute a termination of this Lease or a waiver of Landlord's
right to recover damages under this paragraph 17:
(1) appointment of a receiver in order to protect
Landlord's interest hereunder;
(2) consent to any subletting of the premises or
assignment of this Lease by Tenant, whether pursuant to
provisions hereof concerning subletting and assignment or
otherwise; or
(3) any other action by Landlord or Landlord's agents
intended to mitigate the adverse effects of any breach of this
Lease by Tenant, including without limitation any action taken
to maintain and preserve the premises or any action taken to
relet the premises or any portion thereof for the account of
Tenant and in the name of Tenant.
17.3 LANDLORD'S RIGHT TO PERFORM TENANT'S OBLIGATIONS. If Tenant
shall at any time fail to make any payment or perform any other act required to
be made or performed by Tenant under this Lease, then after the cure period
provided herein and after reasonable notice to Tenant, Landlord may, but shall
not be obligated to, make such payment or perform such other act to the extent
Landlord may deem desirable, and may, in connection therewith, pay any and all
expenses incidental thereto and employ counsel. No such action by Landlord
shall be deemed a waiver by Landlord of any rights or remedies Landlord may have
as a result of such failure by Tenant, or a release of Tenant from performance
of such obligation. All sums so paid by Landlord, including without limitation
all penalties, interest and costs in connection therewith, shall be due and
payable by Tenant to Landlord on the day immediately following any such payment
by Landlord. Landlord shall have the same rights and remedies for the
nonpayment of any such sums as Landlord may be entitled to in the case of
default by Tenant in the payment of rent.
17.4 INTEREST ON PAST DUE OBLIGATIONS. Any amount due to Landlord
hereunder and not paid within the cure period provided herein shall bear
interest at the lesser annual rate of (i) ten percent (10%); or (ii) the highest
rate then allowed by law, from the date due until paid in full. Payment of such
interest shall not excuse or cure any default by Tenant under this Lease.
17.5 ADDITIONAL RENT. All sums payable by Tenant to Landlord or to
third parties under this Lease in addition to such sums payable pursuant to
paragraph 4 hereof shall be payable as additional sums of rent. For purposes of
any unlawful detainer action by Landlord against Tenant pursuant to California
Code of Civil Procedure Sections 1161-1174, or any similar or successor
statutes, Landlord shall be entitled to recover as rent not only such sums
specified in paragraph 3 as may then be overdue, but also all such additional
sums of rent as may then be overdue.
17.6 REMEDIES NOT EXCLUSIVE. No remedy or election hereunder shall
be deemed exclusive but shall, wherever possible, be cumulative with all other
remedies herein provided or permitted at law or in equity.
24.
18. DEFAULT BY LANDLORD.
18.1 CURE PERIOD. Landlord shall not be deemed to be in default in
the performance of any obligation required to be performed by it hereunder
unless and until it has failed to perform such obligation within the period of
time specifically provided herein, or if no period of time has been provided,
then within thirty (30) days after receipt of written notice by Tenant to
Landlord specifying wherein Landlord has failed to perform such obligation;
provided, however, that if the nature of Landlord's obligation is such that more
than thirty (30) days are reasonably required for its performance, then Landlord
shall not be deemed to be in default if it shall commence such performance
within such thirty (30) day period and thereafter diligently prosecute the same
to completion.
18.2 MORTGAGEE PROTECTION. If any deed of trust or mortgage
encumbering the premises so provides, in the event of any default on the part of
Landlord, Tenant will give notice by registered or certified mail to any
beneficiary of a deed of trust or mortgagee of a mortgage encumbering the
premises whose address shall have been furnished to Tenant.
18.3 TENANT'S RIGHT TO PERFORM CERTAIN OF LANDLORD'S OBLIGATIONS.
If Landlord shall at any time fail to maintain or repair the roof in accordance
with paragraph 7.1, then after the cure period provided herein and five (5) days
after further notice to Landlord that Tenant intends to exercise its rights
under this paragraph 18.3, Tenant may, but shall not be obligated to, perform
such maintenance and repair. No such action by Tenant shall be deemed a waiver
by Tenant of any rights or remedies Tenant may have as a result of such failure
by Landlord, or a release of Landlord from performance of such obligation. All
reasonable sums paid by Tenant in performing such maintenance and repair shall
be due and payable by Landlord to Tenant on the day immediately following any
such payment by Tenant.
19. ADVERTISEMENTS AND SIGNS. Tenant shall not place or permit to be
placed any sign, display, advertisement, or decoration ("sign") on the exterior
of the Building, or elsewhere on the premises, without the prior written consent
of Landlord, which consent shall not be unreasonably withheld, as to the color,
size, style, character, content, and location of each such sign. Upon
termination of this Lease, Tenant shall remove any sign which it has placed on
the premises or the Building, and shall repair any damage caused by the
installation or removal of such sign.
20. ENTRY BY LANDLORD. Landlord and its agents shall be entitled to
enter into and upon the premises at all reasonable times upon reasonable notice
(except in the case of an emergency, in which event no notice shall be
required), for purposes of inspecting or making repairs, alterations or
additions to all or any portion thereof, including the erection and maintenance
of such scaffolding, canopies, fences and props as may be required, or for the
purpose of posting notices of nonresponsibility for alterations, additions, or
repairs, or for the purpose of placing upon the premises any ordinary "for sale"
signs, and during the ninety (90) day period prior to the expiration of this
Lease, to place upon the premises any usual or ordinary "for lease" signs and
exhibit the premises to prospective tenants at reasonable hours, all without any
abatement of rent and without liability to Tenant for any injury or
inconvenience to or interference with Tenant's business, quiet enjoyment of the
premises, or any other loss occasioned thereby, except for Landlord's gross
negligence or willful misconduct. Landlord's
25.
rights of entry as set forth in this paragraph shall be subject to the
reasonable security regulations of Tenant and to the requirement that Landlord
shall at all times act in a manner designed to minimize interference with
Tenant's business activities on the premises.
21. SUBORDINATION AND ATTORNMENT.
21.1 SUBORDINATION. Tenant agrees that this Lease may, at the
option of Landlord, be subject and subordinate to any mortgage, deed of trust,
ground lease or other instrument of security now of record or which is recorded
after the date of this Lease affecting the land and Building, or land or
Building, of which the premises form a part, and such subordination is hereby
made effective without any further act of Tenant; provided that such
subordination shall not be effective with respect to any mortgage, deed of
trust, ground lease or other instrument or security recorded after the date of
this Lease unless Landlord first obtains from the lender or ground lessor a
written agreement that provides in essence that as long as Tenant performs its
obligations under this Lease, no foreclosure of, deed given in lieu of
foreclosure, or sale under the encumbrance, and no steps or procedures taken
under the encumbrance, shall affect Tenant's rights under this Lease. Tenant
shall execute and deliver to Landlord any written agreement and any other
documents required by the lender to accomplish the purposes of this paragraph,
within ten (10) business days after delivery thereof to Tenant, and the failure
of Tenant to execute and return any such instruments shall constitute a default
hereunder unless Tenant in good faith disputes the terms of such agreement or
other document.
21.2 ATTORNMENT. Subject to the foregoing paragraph 21.1, Tenant
shall attorn to any third party purchasing or otherwise acquiring the premises
at any sale or other proceeding, or pursuant to the exercise of any rights,
powers or remedies under any mortgages or deeds of trust or ground leases now or
hereafter encumbering all or any part of the premises, as if such third party
had been named as Landlord under this Lease.
22. ESTOPPEL CERTIFICATES AND FINANCIAL STATEMENTS. Each party shall,
within ten (10) days following request by the other party, execute and deliver
any documents, including estoppel certificates, in the form presented by the
party making such request: (i) certifying that this Lease has not been modified
or, if modified, stating the nature of such modification and certifying that
this Lease, as so modified, is in full force and effect, (ii) stating the date
to which the rent and other charges are paid in advance, if at all, (iii)
acknowledging that there are not, to such party's knowledge, any uncured
defaults on the part of either party hereunder, or if there are uncured
defaults, stating the nature of such uncured defaults, and (iv) evidencing the
status of this Lease as may be required either by a lender making a loan to be
secured by a deed of trust or mortgage encumbering the premises or a purchaser
of the premises from Landlord. Tenant shall also, at the request of any lender
of Landlord, provide Landlord with a letter certifying that Tenant's current net
worth is in excess of an amount specified by Tenant. A party's failure to
deliver any such documents within fourteen (14) days following receipt of such
request shall be an Event of Default under this Lease.
23. NOTICES. Any notice, approval, request, demand or consent
(collectively "notice") required or desired to be given under this Lease shall
be in writing and shall be personally served or delivered by United States mail,
registered or certified, postage prepaid, and addressed to the party to be
served at the last address given by that party to the other party under
26.
the provisions of this paragraph. At the date of execution of this Lease, the
addresses of Landlord and Tenant are as set forth below:
Landlord: California Pacific
Commercial Corporation
0000 Xxxx Xxxx Xxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000
Attn: Xxx XxXxxxxx III, President
Tenant: Clontech Laboratories, Inc.
0000 Xxxx Xxxxxx Xxxxxx
Xxxx Xxxx, XX
Attn: Xxx Xxxx
With a Copy to: Xxxxx X. Xxxxxxxxxx, Esq.
Xxxxxx Godward Xxxxxx Xxxxxxxxx & Xxxxx
0 Xxxx Xxxx Xxxxxx, Xxxxx 000
Xxxx Xxxx, XX 00000
Any notice delivered by mail pursuant to this paragraph shall be deemed to have
been delivered three (3) days after the posted date of mailing.
24. WAIVER. The waiver by either party of any breach of any term,
covenant, or condition herein contained shall not be deemed to be a waiver of
such term, covenant or condition or any subsequent breach of the same or any
other term, covenant or condition herein contained. The subsequent acceptance
of rent hereunder by Landlord shall not be deemed to be a waiver of any
preceding breach by Tenant of any term, covenant or condition of this Lease,
other than the failure of Tenant to pay the particular rental so accepted,
regardless of Landlord's knowledge of such preceding breach at the time of
acceptance of such rent. No term, covenant or condition shall be deemed to have
been waived by either party unless such waiver is in writing and signed by the
party making such waiver.
25. NO ACCORD AND SATISFACTION. No payment by Tenant, or receipt by
Landlord, or an amount which is less than the full amount of rent and all other
sums payable by Tenant hereunder at such time shall be deemed to be other than
on account of (a) the earliest of such other sums due and payable, and
thereafter (b) the earliest Base Rent due and payable hereunder. No endorsement
or statement on any check or any letter accompanying any payment of rent or such
other sums shall be deemed an accord and satisfaction. Landlord may accept any
such check or payment without prejudice to Landlord's right to receive payment
of the balance of such rent and/or other sums or to Landlord's right to pursue
any remedies to which Landlord may be entitled to recover such balance.
26. ATTORNEYS' FEES. If any action or proceeding at law or in equity, or
an arbitration proceeding (collectively an "action") shall be brought to recover
any rent under this Lease, or for or on account of any breach of or to enforce
or interpret any of the terms, covenants or conditions of this Lease, or for the
recovery of possession of the premises, the prevailing party shall be entitled
to recover from the other party as a part of such action, or in a separate
action
27.
brought for that purpose, its reasonable attorneys' fees and costs and expenses
incurred in connection with the prosecution or defense of such action.
"Prevailing party" within the meaning of this paragraph shall include, without
limitation, a party who brings an action against the other after the other is in
breach or default, if such action is dismissed upon the other's payment of the
sums allegedly due for performance of the covenants allegedly breached, or if
the party commencing such action obtains substantially the relief sought by it
in such action, whether or not such action proceeds to a final judgment or
determination.
27. SURRENDER. Tenant shall, upon expiration or sooner termination of
this Lease, surrender the premises to Landlord in the same condition as existed
on the date Tenant originally took possession thereof (reasonable wear and tear
and losses due to casualty and condemnation excepted) with all interior walls
cleaned, all holes in walls repaired, all carpets cleaned, all HVAC equipment in
operating order and in good repair, and all floors cleaned and waxed, all to the
reasonable satisfaction of Landlord. Tenant shall at such time also surrender
to Landlord such alterations (as defined in paragraph 8) as Landlord does not
require Tenant to remove in accordance with paragraph 8.6 above. Tenant, on or
before the expiration or sooner termination of this Lease, shall remove all of
its personal property and trade fixtures from the premises, and all property not
so removed shall be deemed abandoned by Tenant. Tenant shall be liable to
Landlord for costs of removal of any such abandoned trade fixtures or equipment
of Tenant, or of any alterations Tenant fails to remove if so required by
Landlord, together with the cost of returning the premises to its condition as
of the date Tenant originally took possession thereof, and the transportation
and storage costs of such items. If the premises are not so surrendered at the
expiration or sooner termination of this Lease, Tenant shall indemnify Landlord
against loss or liability resulting from delay by Tenant in so surrendering the
premises, including without limitation, any claims made by any succeeding tenant
founded on such delay, losses to Landlord due to lost opportunities to lease to
succeeding tenants, and attorneys' fees and costs. All keys to the premises or
any part thereof shall be surrendered to Landlord upon expiration or sooner
termination of the lease term.
28. HOLDING OVER. Unless Tenant exercises in a timely manner its option
to extend the term, this Lease shall terminate without further notice at the
expiration of the initial lease term. Any holding over by Tenant after
expiration shall not constitute a renewal or extension of the lease term or give
Tenant any rights in or to the premises unless otherwise expressly provided in
this Lease. Any holding over after the expiration with the express written
consent of Landlord shall be construed to be a tenancy from month to month, at
one hundred fifty percent (150%) of the monthly Base Rent for the last month of
the lease term, unless otherwise agreed in writing by both Landlord and Tenant,
and shall otherwise be on the terms and conditions herein specified insofar as
applicable, unless otherwise mutually agreed in writing by the parties.
29. TRANSFER OF PREMISES BY LANDLORD. The term "Landlord" as used in
this Lease, so far as the covenants or obligations on the part of Landlord are
concerned, shall be limited to mean and include only the owner at the time in
question of the fee title to the premises. In the event of any transfer of such
fee title, the Landlord herein named (and in case of any subsequent transfer or
conveyance, the then grantor) shall after the date of such transfer or
conveyance by automatically freed and relieved of all liability with respect to
performance of any covenants or obligations on the part of Landlord contained in
this Lease thereafter to be performed; provided that any funds in the hands of
Landlord or the then grantor at the time of
28.
such transfer in which Tenant has an interest shall be turned over to the
grantee. The covenants and obligations contained in this Lease on the part of
Landlord shall, subject to the foregoing, be binding upon each Landlord
hereunder only during his or its respective period of ownership.
30. GENERAL PROVISIONS.
30.1 ENTIRE AGREEMENT. This instrument including the Exhibits
attached hereto contains all of the agreements and conditions made between the
parties hereto and may not be modified orally or in any manner other than by an
agreement in writing signed by all of the parties hereto or their respective
successors in interest. Any executed copy of this Lease shall be deemed an
original for all purposes.
30.2 TIME. Time is of the essence with respect to the performance
of each and every provision of this Lease in which time of performance is a
factor. All references to days contained in this Lease shall be deemed to mean
calendar days unless otherwise specifically stated.
30.3 CAPTIONS. The captions and headings of the numbered paragraphs
of this Lease are inserted solely for the convenience of the parties hereto, and
are not a part of this Lease and shall have no effect upon the construction or
interpretation of any part hereof.
30.4 CALIFORNIA LAW. This Lease shall be construed and interpreted
in accordance with the laws of the State of California. The language in all
parts of this Lease shall in all cases be construed as a whole according to its
fair meaning and not strictly for or against either Landlord or Tenant, and
without regard to which party prepared this Lease.
30.5 GENDER; SINGULAR AND PLURAL. When required by the context of
this Lease, the neuter includes the masculine, the feminine, a partnership, a
corporation or a joint venture, and the singular shall include the plural.
30.6 PARTIAL INVALIDITY. If any provision of this Lease is held by
a court of competent jurisdiction to be invalid, void or unenforceable, the
remainder of the provisions hereof shall nonetheless continue in full force and
effect and shall in no way be affected, impaired, or invalidated thereby.
30.7 NO WARRANTIES. Any agreements, warranties or representations
not expressly contained herein shall not bind either Landlord or Tenant, and
Landlord and Tenant expressly waive all claims for damages by reason of any
statement, representation, warranty, promise or agreement, if any, not expressly
contained in this Lease.
30.8 JOINT AND SEVERAL LIABILITY. If Landlord or Tenant is more
than one person or entity, each such person or entity shall be jointly and
severally liable for the obligations of Landlord or Tenant, respectively,
hereunder.
30.9 SUCCESSORS AND ASSIGNS. The covenants and conditions herein
contained, subject to the provisions as to assignment, shall apply to and bind
the heirs, executors, administrators, assigns, and any other person or entity
succeeding lawfully, and pursuant to the provisions of this Lease, to the rights
or obligations of either of the parties hereto.
29.
30.10 RULES AND REGULATIONS. Landlord may from time to time
promulgate reasonable rules and regulations for the use, safety, care, and
cleanliness of the premises, and the preservation of good order thereon. Such
rules and regulations shall be binding upon Tenant upon delivery of a copy
thereof to Tenant, and Tenant shall abide by all such rules and regulations. If
there is a conflict between such rules and regulations and any of the provisions
of this Lease, the provisions of this Lease shall prevail.
30.11 AUTHORITY. The parties hereby represent and warrant that they
have all necessary power and authority to execute and deliver this Lease on
behalf of Landlord and Tenant, respectively.
30.12 MEMORANDUM OF LEASE. Either party may record a short form
memorandum of this Lease.
30.13 MERGER. The voluntary or other surrender of this Lease, or a
mutual cancellation thereof, shall not work an automatic merger, but shall, at
the sole option of Landlord, either terminate all or any existing subleases or
subtenancies, or operate as an assignment to Landlord of any or all of such
subleases or subtenancies.
30.14 REAL ESTATE BROKERS. Each party represents that it has not had
any dealings with any real estate broker, finder or other person with respect to
this Lease other than Cornish & Xxxxx Commercial, whose leasing commission shall
be paid by Landlord in accordance with its agreement with Cornish & Xxxxx dated
September 12, 1994, and each party shall hold harmless the other party from all
damages, expenses, and liabilities resulting from any claims that may be
asserted against the other party by any broker, finder or other person with whom
the other party has dealt.
30.15 LIMITATION ON LIABILITY. If Tenant obtains a money judgment
against Landlord resulting from any default or other claim arising under this
Lease, such judgment shall be satisfied only out of the rents, profits and
income received by Landlord with respect to its right, title and interest in the
premises. No other real, personal or mixed property of Landlord shall be
subject to levy to satisfy any such judgment and Landlord shall have no personal
liability under this Lease.
30.16 QUIET ENJOYMENT. Landlord agrees to and shall in the
commencement of this Lease place Tenant in quiet possession of the premises and
shall secure it in the quiet possession thereof against all persons lawfully
claiming the same during the lease term.
31. INITIAL IMPROVEMENTS TO PREMISES.
31.1 LANDLORD'S IMPROVEMENTS. Prior to the Delivery Date, Landlord
shall at its expense demolish the existing improvements and remove all asbestos
from the Building. Prior to the Commencement Date, Landlord shall: (i) install
a new roof on the Building; and (ii) undertake such structural repairs as are
necessary to bring the Building in compliance with applicable seismic codes as
of the date of such repairs. Landlord shall bear the expense of installing the
new roof and undertaking such structural repairs for seismic compliance up to a
maximum of the lesser of: (i) cost for such work in the initial bid which
Landlord notifies Tenant is acceptable to Landlord for the same; or (ii) the
cost for such work (excluding any additional
30.
improvements requested by Tenant) in the bid finally accepted by Landlord for
the same. Landlord's share of such costs is referred to herein as the "Base Bid
Amounts." The parties contemplate that at the request of Tenant additional
improvements such as skylights and windows will be undertaken to the roof and
the exterior walls of the building as part of the work being performed by
Landlord. Tenant shall submit completed plans and specifications for its
proposed additional improvements no later than October 10, 1994. All such work
will be performed by Landlord through its contractor and the incremental cost of
such work shall be borne by Tenant. Landlord shall consult with Tenant
regarding the amount of the final bids it proposes to accept before accepting
the same. Landlord shall, at Tenant's request, cause its contractor to obtain
additional bids from subcontractors for the work being subcontracted up to a
maximum of six (6) bids. Tenant may designate specific subcontractors from
which Landlord's contractor will obtain additional bids provided that such
subcontractors are acceptable to Landlord and its contractor. All bids obtained
for such work shall price separately the cost of the additional improvements
requested by Tenant. Landlord shall not accept any bid other than the lowest
bid without the consent of Tenant. Tenant shall have the right upon
notification of the bid amounts for particular work to notify Landlord within
three (3) business days that Tenant elects not to have any additional
improvements undertaken at Tenant's expense. The Tenant Improvement Allowance
provided in paragraph 31.3 shall be reduced by an amount equal to the difference
between the final cost of such work and the Base Bid Amounts.
31.2 TENANT'S IMPROVEMENTS. Tenant shall make all other,
improvements to the premises. Tenant's improvements shall include all work to
the premises, including without limitation electrical, heating, ventilation and
air conditioning, partitions, ceilings, doors, sprinkler alterations, lighting,
floor coverings, window coverings, telephone system and all finishes
(collectively, the "Improvements"). The provisions of paragraph 8 shall comply
with respect to all such work and the Improvements.
Tenant shall have all its work done by or through Xxxxx X.
Xxxxx & Sons, Inc. ("Xxxxx") as its general contractor, provided that the bid
received from Xxxxx is competitive with bids received from other licensed
contractors approved by Landlord. Tenant may use another licensed contractor in
the event that Xxxxx is not competitive on the following conditions: (i) such
contractor and the terms of the construction contract are approved by Landlord;
(ii) in no event shall a contractor other than Xxxxx construct the Required
Improvements; and (iii) such contractor provide a full payment and performance
bond naming both Landlord and Tenant as insured. All contracts for improvement
and alteration shall be between Tenant and its contractor, and no contractor or
other person shall be a third party beneficiary of any provision of this Lease.
All Improvements, except unattached movable business fixtures
and those trade fixtures identified in Exhibit C, shall become the property of
Landlord and shall remain upon and be surrendered with the premises.
31.3 IMPROVEMENT ALLOWANCE. Landlord shall provide Tenant with a
tenant improvement allowance in the amount of One Million Two Hundred Ninety
Three Thousand Six Hundred Dollars ($1,293,600) (the "Tenant Improvement
Allowance"). Tenant shall use said Tenant Improvement Allowance exclusively for
the construction of the Improvements. No portion of the Tenant Improvement
Allowance may be used for furnishings and/or trade fixtures
31.
that are removable by Tenant upon the expiration of the term of the Lease. In
the event the cost of the Improvements exceeds the Tenant Improvement Allowance,
the excess shall be paid by Tenant ("Tenant's Contribution"). The Tenant
Improvement Allowance shall be used exclusively for the purposes set forth above
and any unused portion thereof shall not be paid or otherwise credited to
Tenant.
Prior to commencement of construction, Tenant shall submit an
estimate of the cost of all of the Improvements, including a copy of the
contractor's bid, all in form acceptable to Landlord. Landlord shall have the
right to verify the accuracy of the numbers set forth therein to Landlord's
reasonable satisfaction.
Landlord shall pay Tenant's contractor the Tenant Improvement
Allowance in installments equal to its pro rata share of the amount of the
contractor's invoice as construction progresses and after Landlord's inspection
and verification that the work to be paid for has been completed in a
satisfactory manner. Landlord's pro rata share shall be a fraction, the
numerator of which is the amount of the Tenant Improvement Allowance and the
denominator of which is the total cost of the Improvements. Landlord shall
issue joint checks payable to Tenant and the contractor. Tenant shall provide
evidence satisfactory to Landlord that it is contemporaneously paying its share
of the invoice.
32. RIGHT OF FIRST OPPORTUNITY.
32.1 SALE OF PREMISES. In the event Landlord desires to sell the
premises, before entering into an agreement to sell or exchange the same,
Landlord shall notify Tenant of its desire to sell the premises and the price
and basic terms Landlord is asking. If, within five (5) business days of
receipt of said notice, Tenant gives to Landlord written notice of its interest
in purchasing the premises at the price and upon the terms contained in
Landlord's notice to Tenant, Landlord and Tenant shall in good faith attempt to
negotiate a legally binding agreement to carry out their previously expressed
intent. If Tenant fails to respond to said notice within said five (5) day
period, or if Landlord and Tenant fail to enter into a written agreement for
such a purchase and sale within ten (10) business days after Tenant's notice
expressing its interest in purchasing the premises, the provisions of this
paragraph 32.1 shall be deemed null and void and Landlord shall be free to sell
or exchange the premises to anyone else upon the same or any other terms and
without any further obligation to Tenant, whether or not the terms of such sale
are more or less favorable than those offered to Tenant.
32.2 LEASE OF ADJACENT PARCEL. While Landlord owns both the
Premises and the Adjacent Parcel, Tenant shall have a one-time right of first
opportunity to lease the adjacent parcel of real estate commonly known as
0000-00 Xxxx Xxxxxx Xxxxxx, Xxxx Xxxx, Xxxxxxxxxx (the "Adjacent Parcel") on the
terms set forth below. The parties acknowledge that Landlord currently leases
the Adjacent Parcel to Space Systems/Loral, Inc. ("Loral"). Landlord shall not
enter into a new lease for the Adjacent Parcel with any person other than Loral
in the event that the current Loral lease expires and Loral does not exercise
its option to renew without first offering the Adjacent Parcel to Tenant as
follows. Before entering into a lease for the Adjacent Parcel with any person
other than Loral, Landlord shall notify Tenant of its desire to lease the
Adjacent Parcel and the rent and basic terms Landlord is asking. If, within
five (5) business days of receipt of said notice, Tenant gives to Landlord
written notice of its interest in leasing the
32.
Adjacent Parcel at the rent and upon the terms contained in Landlord's notice to
Tenant, Landlord and Tenant shall in good faith attempt to negotiate a legally
binding lease to carry out their previously expressed intent. If Tenant fails
to respond to said notice within said five (5) business day period, or if
Landlord and Tenant fail to enter into a written lease for the Adjacent Parcel
within ten (10) business days after Tenant's notice expressing its interest in
leasing the Adjacent Parcel, the provisions of this paragraph 32.2 shall be
deemed null and void, and Landlord shall be free to lease the Adjacent Parcel to
anyone else upon the same or any other terms and without any further obligation
to Tenant, whether or not the terms of such lease are more or less favorable
than those offered to Tenant. Landlord shall have the right to amend, modify or
otherwise execute a new lease with Loral without being required to first offer
the Adjacent Parcel to Tenant.
32.3 RIGHTS NOT ASSIGNABLE. Each right granted to Tenant in this
paragraph 32 is personal to Clontech, and neither of said rights is assignable
by Clontech either as a part of an assignment of this Lease or separately or
apart therefrom, and no right may be separated from this Lease in any manner by
reservation or otherwise; provided that said right may be assigned by Clontech
as part of the assignment of this Lease by Clontech (a) to a parent, subsidiary,
affiliate, division, or corporation controlling, controlled by or under common
control with Clontech, or (b) to a successor corporation of Clontech by merger,
consolidation or nonbankruptcy reorganization, or to a successor corporation
which purchases all or substantially all of the assets of Clontech, provided
that in each such case the assignee or successor entity expressly assumes and
agrees to perform for the benefit of Landlord all of the obligations of Tenant
hereunder.
32.4 ADDITIONAL LIMITATION ON RIGHTS. The rights granted to Tenant
in this paragraph 32 may be exercised by Tenant only if Tenant is not in default
under the terms of this Lease and the time of the exercise of such rights.
33. CONDITION SUBSEQUENT. Tenant shall have thirty (30) days from the
date of this Lease (the "Inspection Period") in which to complete its physical
and environmental inspection of the premises. Prior to expiration of the
Inspection Period, Tenant may notify Landlord that Tenant does not approve the
physical condition of the premises. If Tenant timely gives such notice, this
Lease shall terminate as of the date of Landlord's receipt of such notice and
Landlord shall promptly return to Tenant the Deposit provided that Tenant has
not otherwise defaulted hereunder. If Tenant does not timely give such notice,
this Lease shall continue in full force and effect. Tenant shall deliver to
Landlord copies of all reports regarding the premises.
33.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease on the
dates specified below immediately adjacent to their respective signatures.
Delivery of this Lease to Landlord, duly executed by Tenant, constitutes an
offer by Tenant to lease the premises as herein set forth, and under no
circumstances shall such delivery be deemed to create an option or reservation
to lease the premises for the benefit of Tenant. This Lease shall only become
effective and binding upon execution of this Lease by Landlord and delivery of a
signed copy to Tenant.
"Landlord"
CALIFORNIA PACIFIC COMMERCIAL
CORPORATION, a California corporation
By /s/ Xxxxxxx Xxxxxxx
----------------------------------
Xxxxxxx Xxxxxxx, Secretary
Dated: September 15, 1994 By /s/ Xxxxxx X. XxXxxxxx, III
----------------------------------
Xxxxxx X. XxXxxxxx, III
President
"Tenant"
CLONTECH LABORATORIES, INC.,
a California corporation
Dated: September 14, 1994 By: /s/ Xxx Xxxx
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EXHIBITS
Exhibit A Description of Premises
Exhibit B Letter regarding Hazardous Substances
Exhibit C Description of Fixtures
34.
PROPERTY DESCRIPTION 0000 XXXX XXXXXX XXXXXX
XXXX XXXX, XXXXXXXXXX
Parcel Three, Parcel Map Recorded
April 22, 1974, Map Book 338 Page 4
Santa Xxxxx County Records
EXHIBIT "A"
[LOGO] UNITED. SOIL ENGINEERING, INC.
Soil, Foundation and Geological Engineers
0000 XXXXXX XXXXXX, XXXXX XXXXX, XXXXXXXXXX 00000 (408) 988-2990
File No. 94-4070-SEA
July 20, 1994
Xxxxx Xxxxx and Sons, Inc.
0000 Xxxx Xxxxxxxxx
Xxxx Xxxx, XX 00000
Attention: Mr. Xxx Xxxxxxxxxx
Subject: Existing R&D Building
0000 Xxxx Xxxxxx Xxxxxx
Xxxxxxxx 00
Xxxx Xxxx, Xxxxxxxxxx
ADDENDUM TO SUMMARY Of SOIL AND
GROUND WATER INVESTIGATION REPORT
Dear Xx. Xxxxxxxxxx:
Per our conversation, we are presenting herein our review of a soil and
ground water investigation report for the existing Building 24 located at
0000 Xxxx Xxxxxx Xxxxxx in Palo Alto, California.
A soil and ground water investigation report was prepared by H2M Group of
Totowa, New Jersey dated January, 1994, for the existing office building
complex 1010, 1020, and 0000 Xxxx Xxxxxx Xxxxxx in Palo Alto, California.
According to the report, ground water flow direction is eastward. The
temporary monitoring xxxxx, XX-5, and MW-6 were located adjacent to Building
24. The ground water sample extracted from the temporary monitoring xxxxx
XX-5 and MW-6 were tested for traces of priority pollutants, metals, volatile
organic compounds, and semi-volatile organic compounds.
The following compounds were present in the ground water samples extracted from
temporary monitoring xxxxx XX-5 and MW-6.
EXHIBIT "B"
REMOVABLE TRADE FIXTURES
Chemical hoods
Biohazard hoods
Environmental xxxxxxxx
Cold rooms
Autoclaves
Steam generator(s)
Centrifuges
Water purification system(s) (but not including the plumber in DI water system)
Glassware washers
Cage washers
Uninterruptable power supply UPS system
Office furniture
Back-up generator
Equipment monitoring devices
Telephone switch, telephone sets and voicemail system
Kitchen appliances and equipment (e.g., refrigerator, microwave oven)
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