EXHIBIT 10.2
OFFICE BUILDING LEASE
CB COMMERCIAL REAL ESTATE GROUP, INC.
BROKERAGE AND MANAGEMENT
LICENSED REAL ESTATE BROKER
TABLE OF CONTENTS
ARTICLE 1. LEASE OF PREMISES.............................................................................................1
ARTICLE 2. DEFINITIONS...................................................................................................1
ARTICLE 3. EXHIBIT AND ADDENDA...........................................................................................2
ARTICLE 4. DELIVERY OF POSSESSION........................................................................................2
ARTICLE 5. RENT..........................................................................................................2
ARTICLE 6. INTEREST AND LATE CHARGES.....................................................................................3
ARTICLE 7. SECURITY DEPOSIT..............................................................................................3
ARTICLE 8. TENANT'S USE OF THE PREMISES..................................................................................4
ARTICLE 9. SERVICES AND UTILITIES........................................................................................4
ARTICLE 10. CONDITION OF THE PREMISES....................................................................................5
ARTICLE 11. CONSTRUCTION, REPAIRS AND MAINTENANCE........................................................................5
ARTICLE 12. ALTERATIONS AND ADDITIONS....................................................................................6
ARTICLE 13. LEASEHOLD IMPROVEMENTS; TENANT'S PROPERTY....................................................................7
ARTICLE 14. RULES AND REGULATIONS........................................................................................7
ARTICLE 15. CERTAIN RIGHTS RESERVED BY LANDLORD..........................................................................7
ARTICLE 16. ASSIGNMENT AND SUBLETTING....................................................................................8
ARTICLE 17. HOLDING OVER.................................................................................................9
ARTICLE 18. SURRENDER OF PREMISES........................................................................................9
ARTICLE 19. DESTRUCTION OR DAMAGE........................................................................................9
ARTICLE 20. EMINENT DOMAIN...............................................................................................10
ARTICLE 21. INDEMNIFICATION..............................................................................................11
ARTICLE 22. TENANT-S INSURANCE...........................................................................................11
ARTICLE 23. WAIVER OF SUBROGATION........................................................................................12
ARTICLE 24. SUBORDINATION AND ATTORNMENT.................................................................................12
ARTICLE 25. TENANT ESTOPPEL CERTIFICATES.................................................................................12
ARTICLE 26. TRANSFER OF LANDLORD'S INTEREST..............................................................................13
ARTICLE 27. DEFAULT......................................................................................................13
ARTICLE 28. BROKERAGE FEES...............................................................................................15
ARTICLE 29. NOTICES......................................................................................................15
ARTICLE 30. GOVERNMENT ENERGY OR UTILITY CONTROLS........................................................................15
ARTICLE 31. QUIET ENJOYMENT..............................................................................................15
ARTICLE 32. OBSERVANCE OF LAW............................................................................................15
ARTICLE 33. FORCE MAJEURE................................................................................................15
ARTICLE 34. CURING TENANT'S DEFAULTS.....................................................................................16
ARTICLE 35. SIGN CONTROL.................................................................................................16
ARTICLE 36. MISCELLANEOUS................................................................................................16
This lease between The Parkwest Partners, a limited liability company
("Landlord"), and Augment Systems, a Delaware corporation, ("Tenant"), is dated
July 1, 1996.
1. LEASE OF PREMISES
In consideration of the Rent (as defined at Section 5.4) and the provisions of
this Lease, Landlord leases to Tenant and Tenant leases from Landlord the
Premises shown by diagonal lines on the floor plan attached hereto as Exhibit
"A," and further described at Section 21. The Premises are located within the
Building and Project described in Section 2m. Tenant shall have the
non-exclusive right (unless otherwise provided herein) in common with Landlord,
other tenants, subtenants and invitees, to use of the Common Areas (as defined
at Section 2e.)
2. DEFINITIONS
As used in this Lease, the following terms shall have the following meanings:
a. Base Rent (initial): $27,598.44 per year.
b. Broker(s)
Landlord's: CB Commercial Real Estate Group, Inc.
Tenant's: CB Commercial Real Estate Group, Inc.
In the event that CB Commercial Real Estate Group, Inc. represents both Landlord
and Tenant, Landlord and Tenant hereby confirm that they were timely advised of
the dual representation and that they consent to the same, and that they do not
expect said broker to disclose to either of them the confidential information of
the other party.
c. Commencement Date: Upon completion of tenant improvements, currently
estimated to be approximately September 1, 1996.
d. Common Areas: The building lobbies, common corridors and hallways,
restrooms, garage and parking areas, stairways, elevators and other
generally understood public or common areas. Landlord shall have the
right to regulate or restrict the use of the Common Areas.
e. Expiration Date: 48 months from Commencement Date, currently
estimated to be approximately August 31, 2000, unless otherwise sooner
terminated in accordance with the provisions of this Lease.
f. Landlord's Mailing Address: c/o Helm Management, 0000 Xxxx Xxxxx,
Xxxxx X, Xx Xxxx, Xxxxxxxxxx 00000.
Tenant's Mailing Address: at the premises.
g. Monthly Installments of Base Rent (initial): $2,299.87 per month.
h. Parking: Tenant shall be permitted to park nine (9) cars on a
non-exclusive basis in the area(s) designated by Landlord for parking.
Tenant shall abide by any and all parking regulations and rules
established from time to time by Landlord or Landlord's parking
operator.
i. Premises: That portion of the Building containing approximately 2,371
square feet of Rentable Area, shown by diagonal lines on Exhibit "A,"
located on the second floor of the building and known as Suite 255.
j. Project: The building of which the Premises are a part (the
"Building") and any other buildings or improvements on the real property
(the "Property") located at 00000 Xxxx Xxxxxxxx Xxxxx, Xxx Xxxxx,
Xxxxxxxxxx 00000 and further described at Exhibit "B." The Project is
known as Parkwest Court.
k. Rentable Area: As to both the Premises and the Project, the
respective measurements of floor area as may from time to time be
subject to lease by Tenant and all tenants of the Project, respectively,
as determined by Landlord and applied on a consistent basis throughout
the Project.
l. State: The State of California.
m. Tenant's Proportionate Share: 4.84%. Such share is a fraction, the
numerator of which is the Rentable Area of the Premises, and the
denominator of which is the Rentable Area of the Project, as determined
by Landlord from time to time. The Project consists of one building(s)
containing a total Rentable Area of 49,028 square feet.
n. Tenant's Use Clause (Article 8): General office use consistent with
the City of San Diego zoning.
o. Term: The period commencing on the Commencement Date and expiring at
midnight on the Expiration Date.
3. EXHIBIT AND ADDENDA.
The exhibits and addenda listed below (unless lined out) are incorporated by
reference in this Lease:
a. Exhibit "A" - Floor Plan showing the Premises
b. Exhibit "B" - Site Plan of the Project.
c. Exhibit "D" - Rules and Regulations
d. Addenda: See Addendum
e. Exhibit "F" - Option to Extend
4. DELIVERY OF POSSESSION.
Landlord shall use its best efforts to complete Landlord's work and deliver
possession by September 1, 1996. In the event Landlord's work is not completed
by December 1, 1996 and ready for Tenant's possession, Tenant shall have an
option to terminate this lease by providing written notice to Landlord within
fifteen (15) days of December 1, 1996 of their intention to terminate the lease.
If for any reason Landlord does not deliver possession of the Premises to Tenant
on the Commencement Date, Landlord shall not be subject to any liability for
such failure, the Expiration Date shall not change and the validity of this
Lease shall not be impaired, but Rent shall be abated until delivery of
possession. "Delivery of possession" shall be deemed to occur on the date
Landlord completes Landlord's Work as defined in Addendum. If Landlord permits
Tenant to enter into possession of the Premises before the Commencement Date,
such possession shall be subject to the provisions of this Lease, including,
without limitation, the payment of Rent.
5. RENT
5.1. Payment of Base Rent. Tenant agrees to pay the Base Rent for the Premises.
Monthly Installments of Base Rent shall be payable in advance on the first day
of each calendar month of the Term. If the Term begins (or ends) on other than
the first (or last) day of a calendar month, the Base Rent for the partial month
shall be prorated on a per diem basis. Tenant shall pay Landlord the first
Monthly Installment of Base Rent when Tenant executes the Lease.
5.2. Definition of Rent. All costs and expenses which Tenant assumes or agrees
to pay to Landlord under this Lease shall be deemed additional rent (which,
together with the Base Rent is sometimes referred to as the "Rent"). The Rent
shall be paid to the Building manager (or other person) and at such place, as
Landlord may from time to time designate in writing, without any prior demand
therefor and without deduction or offset, in lawful money of the United States
of America.
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5.3. Rent Control. If the amount of Rent or any other payment due under this
Lease violates the terms of any governmental restrictions on such Rent or
payment, then the Rent or payment due during the period of such restrictions
shall be the maximum amount allowable under those restrictions. Upon termination
of the restrictions, Landlord shall, to the extent it is legally permitted,
recover from Tenant the difference between the amounts received during the
period of the restrictions and the amounts Landlord would have received had
there been no restrictions.
5.4. Taxes Payable by Tenant. In addition to the Rent and any other charges to
be paid by Tenant hereunder, Tenant shall reimburse Landlord upon demand for any
and all taxes payable by Landlord (other than net income taxes) which are not
otherwise reimbursable under this Lease, whether or not now customary or within
the contemplation of the parties, where such taxes are upon, measured by or
reasonably attributable to (a) the cost or value of Tenant's equipment,
furniture, fixtures and other personal property located in the Premises, or the
cost or value of any leasehold improvements made in or to the Premises by or for
Tenant, other than Building Standard Work made by Landlord, regardless of
whether title to such improvements is held by Tenant or Landlord; (b) the gross
or net Rent payable under this Lease, including, without limitation, any rental
or gross receipts tax levied by any taxing authority with respect to the receipt
of the Rent hereunder; (c) the possession, leasing, operation, management,
maintenance, alteration, repair, use or occupancy by Tenant of the Premises or
any portion thereof; or (d) this transaction or any document to which Tenant is
a party creating or transferring an interest or an estate in the Premises. If it
becomes unlawful for Tenant to reimburse Landlord for any costs as required
under this Lease, the Base Rent shall be revised to net Landlord the same net
Rent after imposition of any tax or other charge upon Landlord as would have
been payable to Landlord but for the reimbursement being unlawful.
6. INTEREST AND LATE CHARGES.
If Tenant fails to pay within five (5) days of when due any Rent or other
amounts which Tenant is obligated to pay under the terms of this Lease, the
unpaid amounts shall bear interest at the maximum rate then allowed by law.
Tenant acknowledges that the late payment of any Monthly Installment of Base
Rent will cause Landlord to lose the use of that money and incur costs and
expenses not contemplated under this Lease, including without limitation,
administrative and collection costs and processing an accounting expenses, the
exact amount of which if extremely difficult to ascertain. Therefore, in
addition to interest, if any such installments is not received by landlord
within ten (10) days from the date it is due, Tenant shall pay Landlord a late
charge equal to ten percent (10%) of such installment. Landlord and Tenant agree
that this late charge represents a reasonable estimate of such costs and
expenses and is fair compensation to Landlord for the loss suffered from such
nonpayment by Tenant. Acceptance of any interest or late charge shall not
constitute a waiver of Tenant's default with respect to such nonpayment by
Tenant nor prevent Landlord from exercising any other rights or remedies
available to Landlord under this Lease.
7. SECURITY DEPOSIT.
Tenant agrees to deposit with Landlord the Security Deposit set forth at Section
2.0 upon execution of this Lease, as security for Tenant's faithful performance
of its obligations under this Lease. Landlord and Tenant agree that the Security
Deposit may be commingled with funds of Landlord and Landlord shall have no
obligation or liability for payment of interest on such deposit. Tenant shall
not mortgage, assign, transfer or encumber the Security Deposit without the
prior written consent of Landlord and any attempt by Tenant to do so shall be
void, without force or effect and shall not be binding upon Landlord.
If Tenant fails to pay any Rent or other amount when due and payable under this
Lease, or fails to perform any of the terms hereof, Landlord may appropriate and
apply or use all or any portion of the Security Deposit for Rent payments or any
other amount then due and unpaid, for payment of any amount for which Landlord
has become obligated as a result of Tenant's default or breach, and for any loss
or damage sustained by Landlord as a result of Tenant's default or breach, and
Landlord may so apply or use this deposit without prejudice to any other remedy
Landlord may have by reason of Tenant's default or breach. If Landlord so uses
any of the Security Deposit, Tenant shall, within ten (10) days after written
demand therefore, restore the Security Deposit to the full amount originally
deposited; Tenant's failure to do so shall constitute an act of default
hereunder and Landlord shall have the right to exercise any remedy provided for
at Article 27 hereof. Within fifteen (15) days after the Term (or any extension
thereof) has expired or Tenant has vacated the Premises, whichever shall last
occur, and provided Tenant is not then in default on any of its obligations
hereunder, Landlord shall return the Security Deposit to Tenant. or. if Tenant
has assigned its interest under this Lease, to the last assignee of Tenant. If
Landlord sells its interest in the Premises. Landlord may deliver this deposit
to the
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purchaser of Landlord's interest and thereupon be relieved of any further
liability or obligation with respect to the Security Deposit.
8. TENANT'S USE OF THE PREMISES.
Tenant shall use the Premises solely for the purposes set forth in Tenant's Use
Clause. Tenant shall not use or occupy the Premises in violation of law or any
covenant, condition or restriction affecting the Building or Project or the
certificate of occupancy issued for the Building or Project; and shall, upon
notice from Landlord, immediately discontinue any use of the Premises which is
declared by any governmental authority having jurisdiction to be a violation of
law or the certificate of occupancy. Tenant, at Tenant's own cost and expense,
shall comply with all laws, ordinances, regulations, rules and/or any directions
of any governmental agencies or authorities having jurisdiction which shall, by
reason of the nature of Tenant's use or occupancy of the Premises, impose any
duty upon Tenant or Landlord with respect to the Premises or its use or
occupation. A judgment of any court of competent jurisdiction nor the admission
by Tenant in any action or proceeding against Tenant that Tenant has violated
any such laws, ordinance, regulations, rules and/or directions in the use of the
Premises shall be deemed to be a conclusive determination of that fact as
between Landlord and Tenant. Tenant shall not do or permit to be done anything
which will invalidate or increase the cost of any fire, extended coverage or
other insurance policy covering the Building or Project and/or property located
therein, and shall comply with all rules, orders, regulations, requirements and
recommendations of the Insurance Services Office or any other organization
performing a similar function. Tenant shall promptly upon demand reimburse
Landlord for any additional premium charged for such policy by reason of
Tenant's failure to comply with the provisions of this Article. Tenant shall not
do or permit anything to be done in or about the Premises which will in any way
obstruct or interfere with the rights of other tenants or occupants of the
Building or Project, or injure or annoy them, or use or allow the Premises to be
used for any improper, immoral, unlawful or objectionable purpose, nor shall
Tenant cause, maintain or permit any nuisance in, on or about the Premises.
Tenant shall not commit or suffer to be committed any waste in or upon the
Premises.
9. SERVICES AND UTILITIES.
Tenant shall have access and the ability to turn on electricity and HVAC 24
hours per day, 7 days per week. However, the standard building hours are Monday
through Friday, 8:00 a.m. to 6:00 p.m. and Saturdays from 9:00 a.m. to 1:00 p.m.
In event Tenant utilizes after-hours utilities after the above mentioned hours,
Tenant shall keep track of the number of hours it utilizes each month and
communicate that information to the property manager. The over hours will be
taken into consideration in calculating the pro rata share of utility bills to
be reimbursed to the Landlord.
Provided that Tenant is paying its pro rata share of electricity as outlined in
the Addendum, Landlord agrees to furnish to the Premises during generally
recognized business days, and during hours determined by Landlord in its sole
discretion, and subject to the Rules and Regulations of the Building or Project,
electricity for normal desk top office equipment and normal copying equipment,
and heating, ventilation and air conditioning ("HVAC") as required in Landlord's
judgment for the comfortable use and occupancy of the Premises. If Tenant
desires HVAC at any other time, Landlord shall use reasonable efforts to furnish
such service upon reasonable notice from Tenant and Tenant shall pay Landlord's
charges therefor on demand. Landlord shall also maintain and keep lighted the
common stairs, common entries and restrooms in the Building. Landlord shall not
be in default hereunder or be liable for any damages directly or indirectly
resulting from, nor shall the Rent be abated by reason of (i) the installation,
use or interruption of use of any equipment in connection with the furnishing of
any of the foregoing services, (ii) failure to furnish or delay in furnishing
any such services where such failure or delay is caused by accident or any
condition or event beyond the reasonable control of Landlord, or by the making
of necessary repairs or improvements to the Premises, Building or Project, or
(iii) the limitation, curtailment or rationing of, or restrictions on, use of
water, electricity, gas or any other form of energy serving the Premises,
Building or Project. Landlord shall not be liable under any circumstances for a
loss of or injury to property or business, however occurring, through or in
connection with or incidental to failure to furnish any such services. If Tenant
uses heat generating machines or equipment in the Premises which affect the
temperature otherwise maintained by the HVAC system, Landlord reserves the right
to install supplementary air conditioning units in the Premises and the cost
thereof, including the cost of installation, operation and maintenance thereof.,
shall be paid by Tenant to Landlord upon demand by Landlord.
Tenant shall not, without the written consent of Landlord, use any apparatus or
device in the Premises, including without limitation, electronic data processing
machines, punch card machines or machines using in excess of 120 volts,
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which consumes more electricity than is usually furnished or supplied for the
use of premises as general office space, as determined by Landlord. Tenant shall
not connect any apparatus with electric current except through existing
electrical outlets in the Premises. Tenant shall not consume water or electric
current in excess of that usually furnished or supplied for the use Of premises
as general office space (as determined by Landlord), without first procuring the
written consent of Landlord, which Landlord may refuse, and in the event of
consent, Landlord may have installed a water meter or electrical current meter
in the Premises to measure the amount of water or electric current consumed. The
cost of any such meter and of its installation, maintenance and repair shall be
paid for by the Tenant and Tenant agrees to pay to Landlord promptly upon demand
for all such water and electric current consumed as shown by said meters, at the
rates charged for such services by the local public utility plus any additional
expense incurred in keeping account of the water and electric current so
consumed. If a separate meter is not installed, the excess cost for such water
and electric current shall be established by an estimate made by a utility
company or electrical engineer hired by Landlord at Tenant's expense.
Nothing contained in this Article shall restrict Landlord's right to require at
any time separate metering of utilities furnished to the Premises. In the event
utilities are separately metered, Tenant shall pay promptly upon demand for all
utilities consumed at utility rates charged by the local public utility plus any
additional expense incurred by Landlord in keeping account of the utilities so
consumed. Tenant shall be responsible for the maintenance and repair of any such
meters at its sole cost.
Landlord shall furnish elevator service, lighting replacement for building
standard lights, restroom supplies. window washing and janitor services in a
manner that such services are customarily furnished to comparable office
buildings in the area.
10. CONDITION OF THE PREMISES.
Tenant's taking Possession of the Premises shall be deemed conclusive evidence
that as of the date of taking possession the Premises are in good order and
satisfactory condition, except for such matters as to which Tenant gave Landlord
notice on or before the Commencement Date and latent defects. No promise of
Landlord to alter, remodel, repair or improve the Premises, the Building or the
Project and no representation, express or implied, respecting any matter or
thing relating to the Premises, Building, Project or this Lease (including.
without limitation, the condition of the Premises, the Building or the Project)
have been made to Tenant by Landlord or its Broker or Sales Agent, other than as
may be contained herein or in a separate exhibit or addendum signed by Landlord
and Tenant.
11. CONSTRUCTION, REPAIRS AND MAINTENANCE.
a. Landlord's Obligations. Landlord shall perform Landlord's Work to the
Premises as described in Addendum. Landlord shall maintain in good
order, condition and repair the Building and all other portions of the
Premises not the obligation of Tenant or of any other tenant in the
Building.
b. Tenant's Obligations.
(1) Tenant at Tenant's sole expense shall, except for services
furnished by Landlord pursuant to Article 9 hereof, maintain the
Premises in good order, condition and repair, including the
interior surfaces of the ceilings, walls and floors, all doors, all
interior windows, all Plumbing, pipes and fixtures, electrical
wiring, switches and fixtures, Building Standard furnishings and
special Items and equipment installed by or at the expense of
Tenant.
(2) Tenant shall be responsible for all repairs and alterations in
and to the Premises, Building and Project and the facilities and
system, thereof, the need for which arises out of (i) Tenant's use
or occupancy of the Premises, (ii) the installation, removal, use
or operation of Tenant's Property (as defined in Article 13) in the
Premises, (iii) the moving of Tenant's Property into or out of the
Building. or (iv) the act, omission, misuse or negligence of
Tenant. Its agents, contractors, employees, or invitees.
(3) If Tenant fails to maintain the Premises in good order,
condition and repair, Landlord shall give Tenant notice to do such
acts as are reasonably required to so maintain the Premises. If
Tenant fails to promptly commence such work and diligently
prosecute it to completion, than Landlord shall have the right
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to do such acts and expend such funds at the expense of Tenant as
are reasonably required to perform such work. Any amount so
expended by Landlord shall be paid by Tenant promptly after demand
with interest at the prime commercial rate then being charged by
Bank of America NT & SA plus two percent (2% ) per annum, from the
date of such work, but not to exceed the maximum rate then allowed
by law. Landlord shall have no liability to Tenant for any damage,
inconvenience, or interference with the use of the Premises by
Tenant as a result of performing any such work.
c. Compliance with Law. Landlord and Tenant shall each do all acts
required to comply with all applicable laws, ordinances, and rules of
any public authority relating to their respective maintenance
obligations as set forth herein.
d. Waiver by Tenant. Tenant expressly waives the benefits of any statute
now or hereafter in effect which would otherwise afford the Tenant the
right to make repairs at Landlord's expense or to terminate this Lease
because of Landlord's failure to keep the Premises in good order,
condition and repair.
e. Load and Equipment Limits. Tenant shall not place a load upon any
floor of the Premises which exceeds the load per square foot which such
floor was designed to carry, as determined by Landlord or Landlord's
structural engineer. The cost of any such determination made by
Landlord's structural engineer shall be paid for by Tenant upon demand.
Tenant shall not install business machines or mechanical equipment which
cause noise or vibration to such a degree as to be objectionable to
Landlord or other Building tenants.
f. Except as otherwise expressly provided in this Lease, Landlord shall
have no liability to Tenant nor shall Tenant's obligations under this
Lease be reduced or abated in any manner whatsoever by reason of any
inconvenience, annoyance, interruption or injury to business arising
from Landlord's making any repairs or changes which Landlord is required
or permitted by this Lease or by any other tenant's lease or required by
law to make in or to any portion of the Project, Building or the
Premises. Landlord shall nevertheless use reasonable efforts to minimize
any interference with Tenant's business in the Premises.
g. Tenant shall give Landlord prompt notice of any damage to or
defective condition in any part or appurtenance of the Building's
mechanical, electrical. plumbing, HVAC or other systems serving, located
in, or passing through the Premises.
h. Upon the expiration or earlier termination of this Lease, Tenant
shall return the Premises to Landlord clean and in the same condition as
on the date Tenant took possession, except for normal wear and tear. Any
damage to the Premises, including any structural damage, resulting from
Tenant's use or from the removal of Tenant's fixtures, furnishings and
equipment pursuant to Section 13b shall be repaired by Tenant at
Tenant's expense.
12. ALTERATIONS AND ADDITIONS.
a. Tenant shall not make any additions, alterations or improvements to
the Premises without obtaining the prior written consent of Landlord.
Landlord's consent may be conditioned on Tenant's removing any such
additions, alterations or improvements upon the expiration of the Term
and restoring the Premises to the same condition as on the date Tenant
took possession. All work with respect to any addition, alteration or
improvement shall be done in a good and workmanlike manner by properly
qualified and licensed personnel approved by Landlord, and such work
shall be diligently prosecuted to completion. Landlord may, at
Landlord's option, require that any such work be performed by Landlord's
contractor, in which case the cost of such work shall be paid for before
commencement of the work. Tenant shall pay to Landlord upon completion
of any such work by Landlord's contractor.
b. Tenant shall pay the costs of any work done on the Premises pursuant
to Section 12a, and shall keep the Premises, Building and Project free
and clear of liens of any kind. Tenant shall indemnify, defend against
and keep Landlord free and harmless from all liability, loss, damage,
costs, attorneys' fees and any other expense incurred on account of
claims by any person performing work or furnishing materials or supplies
for Tenant or any person claiming under Tenant.
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Tenant shall keep Tenant's leasehold interest, and any additions or
improvements which are or become the property of Landlord under this
Lease, free and clear of all attachment or judgment liens. Before the
actual commencement of any work for which a claim or lien may be filed,
Tenant shall give Landlord notice of the intended commencement date a
sufficient time before that date to enable Landlord to post notices of
non-responsibility or any other notices which Landlord deems necessary
for the proper protection of Landlord's interest in the Premises,
Building or the Project, and Landlord shall have the right to enter the
Premises and post such notices at any reasonable time.
c. Landlord may require, at Landlord's sole option, that Tenant provide
to Landlord, at Tenant's expense, a lien and completion bond in an
amount equal to at least one and one-half (1 1/2) times the total
estimated cost of any additions, alterations or improvements to be made
In or to the Premises, to protect Landlord against any liability for
mechanic's and materialmen's liens and to insure timely completion of
the work. Nothing contained in this Section 12c shall relieve Tenant of
its obligation under Section 12b to keep the Premises, Building and
Project free of all liens.
d. Unless their removal is required by Landlord as provided in Section
12a, all additions, alterations and improvements made to the Premises
shall become the property of Landlord and be surrendered with the
Premises upon the expiration of the Term; provided, however, Tenant's
equipment, machinery and trade fixtures which can be removed without
damage to the Premises shall remain the property of Tenant and may be
removed, subject to the provisions of Section 13b.
13. LEASEHOLD IMPROVEMENTS; TENANT'S PROPERTY.
a. All fixtures, equipment, improvements and appurtenances attached to
or built into the Premises at the commencement of or during the Term,
whether or not by or at the expense of Tenant ("Leasehold
Improvements"), shall be and remain a part of the Premises, shall be the
property of Landlord and shall not be removed by Tenant, except as
expressly provided in Section 13b.
b. All movable partitions, business and trade fixtures, machinery and
equipment, communications equipment and office equipment located in the
Premises and acquired by or for the account of Tenant, without expense
to Landlord, which can be removed without structural damage to the
Building, and all furniture, furnishings and other articles of movable
personal property owned by Tenant and located in the Premises
(collectively "Tenant's Property") shall be and shall remain the
property of Tenant and may be removed by Tenant at any time during the
Term; provided that if any of Tenant's Property is removed, Tenant shall
promptly repair any damage to the Premises or to the Building resulting
from such removal.
14. RULES AND REGULATIONS.
Tenant agrees to comply with (and cause its agents, contractors, employees and
invitees to comply with) the rules and regulations attached hereto as Exhibit
"D" and with such reasonable modifications thereof and additions thereto as
Landlord may from time to time make. Landlord shall not be responsible for any
violation of said rules and regulations by other tenants or occupants of the
Building or Project.
15. CERTAIN RIGHTS RESERVED BY LANDLORD.
Landlord reserves the following rights, exercisable without liability to Tenant
for (a) damage or injury to property, person or business, (b) causing an actual
or constructive eviction from the Premises, or (c) disturbing Tenant's use or
possession of the Premises:
a. To name the Building and Project and to change the name or street
address of the Building or Project;
b. To install and maintain all signs on the exterior and interior of the
Building and Project;
c. To have pass keys to the Premises and all doors within the Premises,
excluding Tenant's vaults and safes;
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d. At any time during the Term, and on reasonable prior notice to
Tenant, to inspect the Premises, and to show the Premises to any
prospective purchaser or mortgagee of the Project, or to any assignee of
any mortgage on the Project, or to others having an interest in the
Project or Landlord, and during the last six months of the Term, to show
the Premises to prospective tenants thereof; and
e. To enter the Premises for the purpose of making inspections, repairs,
alterations, additions or improvements to the Premises or the Building
(including, without limitation, checking, calibrating, adjusting or
balancing controls and other parts of the HVAC system), and to take all
steps as may be necessary or desirable for the safety, protection,
maintenance or preservation of the Premises or the Building or
Landlord's interest therein, or as may be necessary or desirable for the
operation or improvement of the Building or in order to comply with
laws, orders or requirements of governmental or other authority.
Landlord agrees to use its best efforts (except in an emergency) to
minimize interference with Tenant's business in the Premises in the
course of any such entry.
16. ASSIGNMENT AND SUBLETTING.
No assignment of this Lease or sublease of all or any part of the Premises shall
be permitted, except as provided in this Article 16.
a. Tenant shall not, without the prior written consent of Landlord,
assign or hypothecate this Lease or any interest herein or sublet the
Premises or any part thereof, or permit the use of the Premises by any
party other than Tenant. Any of the foregoing acts without such consent
shall be void and shall, at the option of Landlord, terminate this
Lease. This Lease shall not, nor shall any interest of Tenant herein, be
assignable by operation of law without the written consent of Landlord.
b. If at any time or from time to time during the Term Tenant desires to
assign this Lease or sublet all or any part of the Premises, Tenant
shall give notice to Landlord setting forth the terms and provisions of
the proposed assignment or sublease, and the identity of the proposed
assignee or subtenant. Tenant shall promptly supply Landlord with such
information concerning the business background and financial condition
of such proposed assignee or subtenant as Landlord may reasonably
request. Landlord shall have the option, exercisable by notice given to
Tenant within twenty (20) days after Tenant's notice is given, either to
sublet such space from Tenant at the rental and on the other terms set
forth in this Lease for the term set forth in Tenant's notice, or, in
the case of an assignment, to terminate this Lease. If Landlord does not
exercise such option, Tenant may assign the Lease or sublet such space
to such proposed assignee or subtenant on the following further
conditions:
(1) Landlord shall have the right to approve such proposed assignee
or subtenant, which approval shall not be unreasonably withheld;
(2) The assignment or sublease shall be on the same terms set forth
in the notice given to Landlord;
(3) No assignment or sublease shall be valid and no assignee or
sublessee shall take possession of the Premises until an executed
counterpart of such assignment or sublease has been delivered to
Landlord;
(4) No assignee or sublessee shall have a further right to assign
or sublet except on the terms herein contained; and
(5) Any sums or other economic consideration received by Tenant as
a result of such assignment or subletting however denominated under
the assignment or sublease, which exceed, in the aggregate, (i) the
total sums which Tenant is obligated to pay Landlord under this
Lease (prorated to reflect obligations allocable to any portion of
the Premises subleased), plus (ii) any real estate brokerage
commissions or fees together with all other reasonable expenses of
assignment or subletting payable in connection with such assignment
or subletting, shall be paid to Landlord as additional rent under
this Lease without affecting or reducing any other obligations of
Tenant hereunder. Pro forma over the life of the assignment or
sublet.
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c. Notwithstanding the provisions of paragraphs a and b above, Tenant
may assign this Lease or sublet the Premises or any portion thereof,
without Landlord's consent and without extending any recapture or
termination option to Landlord, to any corporation which controls, is
controlled by or is under common control with Tenant, or to any
corporation resulting from a merger or consolidation with Tenant, or to
any person or entity which acquires all the assets of Tenant's business
as a going concern, provided that (i) the assignee or sublessee assumes,
in full, the obligations of Tenant under this Lease, (ii) Tenant remains
fully liable under this Lease, and (iii) the use of the Premises under
Article 8 remains unchanged.
d. No subletting or assignment shall release Tenant of Tenant's
obligations under this Lease or alter the primary liability of Tenant to
pay the Rent and to perform all other obligations to be performed by
Tenant hereunder. The acceptance of Rent by Landlord from any other
person shall not be deemed to be a waiver by Landlord of any provision
hereof. Consent to one assignment or subletting shall not be deemed
consent to any subsequent assignment or subletting. In the event of
default by an assignee or subtenant of Tenant or any successor of Tenant
in the performance of any of the terms hereof, Landlord may proceed
directly against Tenant without the necessity of exhausting remedies
against such assignee, subtenant or successor. Landlord may consent to
subsequent assignments of the Lease or sublettings or amendments or
modifications to the Lease with assignees of Tenant, without notifying
Tenant, or any successor of Tenant, and without obtaining its or their
consent thereto and any such actions shall not relieve Tenant of
liability under this Lease.
e. If Tenant assigns the Lease or sublets the Premises or requests the
consent of Landlord to any assignment or subletting or if Tenant
requests the consent of Landlord for any act that Tenant proposes to do,
then Tenant shall, upon demand, pay Landlord an administrative fee of
One Hundred Fifty and No/100ths Dollars ($150.00) plus any attorneys'
fees reasonably incurred by Landlord in connection with such act or
request.
17. HOLDING OVER.
If after expiration of the Term, Tenant remains in possession of the Premises
with Landlord's permission (express or implied), Tenant shall become a tenant
from month to month only, upon all the provisions of this Lease (except as to
term and Base Rent), but the "Monthly Installments of Base Rent" payable by
Tenant shall be increased to one hundred fifty percent (150%) of the Monthly
Installments of Base Rent payable by Tenant at the expiration of the Term. Such
monthly rent shall be payable in advance on or before the first day of each
month. If either party desires to terminate such month to month tenancy, it
shall give the other party not less than thirty (30) days advance written notice
of the date of termination.
18. SURRENDER OF PREMISES.
a. Tenant shall peaceably surrender the Premises to Landlord on the
Expiration Date, in broom-clean condition and in as good condition as
when Tenant took possession, except for (i) reasonable wear and tear,
(ii) loss by fire or other casualty, and (iii) loss by condemnation.
Tenant shall, on Landlord's request, remove Tenant's Property on or
before the Expiration Date and promptly repair all damage to the
Premises or Building caused by such removal.
b. If Tenant abandons or surrenders the Premises, or is dispossessed by
process of law or otherwise, any of Tenant's Property left on the
Premises shall be deemed to be abandoned, and, at Landlord's option,
title shall pass to Landlord under this Lease as by a xxxx of sale. If
Landlord elects to remove all or any part of such Tenant's Property, the
cost of removal, including repairing any damage to the Premises or
Building caused by such removal, shall be paid by Tenant. On the
Expiration Date Tenant shall surrender all keys to the Premises.
19. DESTRUCTION OR DAMAGE.
a. If the Premises or the portion of the Building necessary for Tenant's
occupancy is damaged by fire, earthquake, act of God, the elements of
other casualty, Landlord shall, subject to the provisions of this
Article, promptly repair the damage, if such repairs can, in Landlord's
opinion, be completed within (90) ninety days. If Landlord determines
that repairs can be completed within ninety (90) days, this Lease shall
remain in full force and effect, except that if such damage is not the
result of the willful misconduct of Tenant or Tenant's agents,
employees, contractors, licensees or invitees, the Base Rent shall be
abated to the extent Tenant's use of the
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Premises is impaired, commencing with the date of damage and continuing
until completion of the repairs required of Landlord under Section 19d.
b. If in Landlord's opinion, such repairs to the Premises or portion of
the Building necessary for Tenant's occupancy cannot be Completed within
ninety (90) days. Landlord may elect, upon notice to Tenant given within
thirty (30) days after the date of such fire or other casualty, to
repair such damage, in which event this Lease shall continue in full
force and effect, but the Base Rent shall be partially abated as
provided in Section 19a. If Landlord does not so elect to make such
repairs, this Lease shall terminate as of the date of such fire or other
casualty. If, in Landlord's opinion, such repairs to the Premises or
portion of the Building necessary for Tenant's occupancy cannot be
completed within one hundred eighty (180) days, Tenant-shall have the
one-time right to terminate this Lease by providing written notice to
Landlord within thirty (30) days after the date of such fire or
casualty. If repairs to the Premises are not completed within one
hundred eighty (180) days from the initial damage, Tenant shall have a
one-time right to terminate this Lease by providing written notice to
Landlord within thirty (30) days after the end of the 180-day period.
c. If any other portion of the Building or Project is totally destroyed
or damaged to the extent that in Landlord's opinion repair thereof
cannot be completed within ninety (90) days, Landlord may elect upon
notice to Tenant given within thirty (30) days after the date of such
fire or other casualty, to repair such damage, in which event this Lease
shall continue in full force and effect, but the Base Rent shall be
partially abated as provided in Section 19a. If Landlord does not elect
to make such repairs, this Lease shall terminate as of the date of such
fire or other casualty.
d. If the Premises are to be repaired under this Article, Landlord shall
repair at its cost any injury or damage to the Building and Building
Standard Work in the Premises. Tenant shall be responsible at its sole
cost and expense for the repair, restoration and replacement of any
other Leasehold Improvements and Tenant's Property. Landlord shall not
be liable for any loss of business, inconvenience or annoyance arising
from any repair or restoration of any portion of the Premises, Building
or Project as a result of any damage from fire or other casualty.
e. This Lease shall be considered an express agreement governing any
case of damage to or destruction of the Premises, Building or Project by
fire or other casualty, and any present or future law which purports to
govern the rights of Landlord and Tenant in such circumstances in the
absence of express agreement, shall have no application.
20. EMINENT DOMAIN.
a. If the whole of the Building or Premises is lawfully taken by
condemnation or in any other manner for any public or quasi public
purpose, this Lease shall terminate as of the date of such taking, and
Rent shall be prorated to such date. If less than the whole of the
Building or Premises is so taken, this Lease shall be unaffected by such
taking, provided that (i) Tenant shall have the right to terminate this
Lease by notice to Landlord given within ninety (90) days after the date
of such taking if twenty percent (20%) or more of the Premises is taken
and the remaining area of the Premises is not reasonably sufficient for
Tenant to continue operation of its business, and (ii) Landlord shall
have the right to terminate this Lease by notice to Tenant given within
ninety (90) days after the date of such taking. If either Landlord or
Tenant so elects to terminate this Lease, the Lease shall terminate on
the thirtieth (30th) day after either such notice. The Rent shall be
prorated to the date of termination. If this Lease continues in force
upon such partial taking, the Base Rent and Tenant's Proportionate Share
shall be equitably adjusted according to the remaining Rentable Area of
the Premises and Project.
b. In the event of any taking, partial or whole, all of the proceeds of
any award, judgment or settlement payable by the condemning authority
shall be the exclusive property of Landlord, and Tenant hereby assigns
to Landlord all of its right. title and interest in any award, judgment
or settlement from the condemning authority. Tenant, however, shall have
the right, to the extent that Landlord's award is not reduced or
prejudiced, to claim from the condemning authority (but not from
Landlord) such compensation as may be recoverable by Tenant in its own
right for relocation expenses and damage to Tenant's personal property.
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c. In the event of a partial taking of the Premises which does not
result in a termination of this Lease, Landlord shall restore the
remaining portion of the Premises as nearly as practicable to its
condition prior to the condemnation or taking, but only to the extent of
Building Standard Work. Tenant shall be responsible at its sole cost and
expense for the repair, restoration and replacement of any other
Leasehold Improvements and Tenant's Property.
21. INDEMNIFICATION.
a. Tenant shall indemnify and hold Landlord harmless against and from
liability and claims of any kind for loss or damage to property of
Tenant or any other person, or for any injury to or death of any person,
arising out of: (1) Tenant's use and occupancy of the Premises, or any
work, activity or other things allowed or suffered by Tenant to be done
in, on or about the Premises; (2) any breach or default by Tenant of any
of Tenant's obligations under this Lease: or (3) any negligent or
otherwise tortious act or omission of Tenant, its agents, employees,
invitees or contractors but excepting here from Landlord's gross
negligence or willful misconduct. Tenant shall at Tenant's expense, and
by counsel satisfactory to Landlord, defend Landlord in any action or
proceeding arising from any such claim and shall indemnify Landlord
against all costs, attorneys' fees, expert witness fees and any other
expenses incurred in such action or proceeding. As a material part of
the consideration for Landlord's execution of this Lease, Tenant hereby
assumes all risk of damage or injury to any person or property in, on or
about the Premises from any cause.
b. Landlord shall not be liable for injury or damage which may be
sustained by the person or property of Tenant, its employees, invitees
or customers, or any other person In or about the Premises, caused by or
resulting from fire, steam, electricity, gas, water or rain which may
leak or flow from or into any part of the Premises, or from the
breakage, leakage, obstruction or other defects of pipes, sprinklers,
wires, appliances, plumbing, air conditioning or lighting fixtures,
whether such damage or injury results from conditions arising upon the
Premises or upon other portions of the Building or Project or from other
sources. Landlord shall not be liable for any damages arising from any
act or omission of any other tenant of the Building or Project.
22. TENANTS INSURANCE.
a. All insurance required to be carried by Tenant hereunder shall be
issued by responsible insurance companies acceptable to Landlord and
Landlord's lender and qualified to do business in the State. Each policy
shall name Landlord, and at Landlord's request any mortgagee of
Landlord, as an additional insured, as their respective interests may
appear. Each policy shall contain (i) a cross-liability endorsement,
(ii) a provision that such policy and the coverage evidenced thereby
shall be primary and non-contributing with respect to any policies
carried by Landlord and that any coverage carried by Landlord shall be
excess insurance, and (iii) a waiver by the insurer of any right of
subrogation against Landlord, its agents, employees and representatives,
which arises or might arise by reason of any payment under such policy
or by reason of any act or omission of Landlord, its agents, employees
or representatives. A copy of each paid up policy (authenticated by the
insurer) or certificate of the insurer evidencing the existence and
amount of each insurance policy required hereunder shall be delivered to
Landlord before the date Tenant is first given the right of possession
of the Premises, and thereafter within thirty (30) days after any demand
by Landlord therefor. Landlord may, at any time and from time to time,
inspect and/or copy any insurance policies required to be maintained by
Tenant hereunder. No such policy shall be cancellable except after
twenty (20) days written notice to Landlord and Landlord's lender.
Tenant shall furnish Landlord with renewals or 'binders" of any such
policy at least ten (10) days prior to the expiration thereof. Tenant
agrees that if Tenant does not take out and maintain such insurance,
Landlord may (but shall not be required to) procure said insurance on
Tenant's behalf and charge the Tenant the premiums together with a
twenty-five percent (25%) handling charge, payable upon demand. Tenant
shall have the right to provide such insurance coverage pursuant to
blanket policies obtained by the Tenant, provided such blanket policies
expressly afford coverage to the Premises, Landlord, Landlord's
mortgagee and Tenant as required by this Lease.
b. Beginning on the date Tenant is given access to the Premises for any
purpose and continuing until expiration of the Term, Tenant shall
procure, pay for and maintain in effect policies of casualty insurance
covering (i) all Leasehold Improvements (including any alterations,
additions or improvements as may be made by Tenant pursuant to the
provisions of Article 12 hereof), and (ii) trade fixtures. merchandise
and other
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Personal property from time to time in, on or about the Premises, in an
amount not less than one hundred percent (100%) of their actual
replacement cost from time to time, providing protection against any
peril included within the classification 'Fire and Extended Coverage"
together with insurance against sprinkler damage, vandalism and
malicious mischief. The proceeds of such insurance shall be used for the
repair or replacement of the property so insured. Upon termination of
this Lease following a casualty as set forth herein, the Proceeds under
(i) shall be paid to Landlord, and the proceeds under (ii) above shall
be paid to Tenant.
c. Beginning on the date Tenant is given access to the Premises for any
purpose and continuing until expiration of the term, pay for and
maintain in effect workers' compensation insurance as required by law
and comprehensive public liability and property damage insurance with
respect to the construction of improvements on the Premises, the use,
operation or condition of the Premises and the operations of Tenant in,
on or about the Premises, providing personal injury and broad form
property damage coverage for not less than One Million Dollars
($1,000,000.00) combined single limit for bodily injury, death and
property damage liability.
d. Not less than every three (3) years during the Term, Landlord and
Tenant shall mutually agree to increases in all of Tenant's insurance
Policy limits for all insurance to be carried by Tenant as set forth in
this Article. In the event Landlord and Tenant cannot mutually agree
upon the amounts of said increases, then Tenant agrees that all
insurance policy limits as set forth in this Article shall be adjusted
for increases in the cost of living in the same manner as is set forth
in Section 5.2 hereof for the adjustment of the Base Rent.
23. WAIVER OF SUBROGATION.
Landlord and Tenant each hereby waive all rights of recovery against the other
and against the officers, employees. agents and representatives of the other, on
account of loss by or damage to the waiving party of its property or the
property of others under its control, to the extent that such loss or damage is
insured against under any fire and extended coverage insurance policy which
either may have in force at the time of the loss or damage. Tenant shall, upon
obtaining the policies of insurance required under this Lease, give notice to
its insurance carrier or carriers that the foregoing mutual waiver of
subrogation is contained in this Lease.
24. SUBORDINATION AND ATTORNMENT.
Upon written request of Landlord, or any first mortgagee or first deed of trust
beneficiary of Landlord, or ground lessor of Landlord, Tenant shall, in writing,
subordinate its rights under this Lease to the lien of any first mortgage or
first deed of trust. or to the interest of any lease in which Landlord is
lessee, and to all advances made or hereafter to be made thereunder. However,
before signing any subordination agreement, Tenant shall have the right to
obtain from any lender or lessor or Landlord requesting such subordination, an
agreement in writing providing that, as long as Tenant is not in default
hereunder, this Lease shall remain in effect for the full Term. The holder of
any security interest may, upon written notice to Tenant, elect to have this
Lease prior to its security interest regardless of the time of the granting or
recording of such security interest.
In the event of any foreclosure sale, transfer in lieu of foreclosure or
termination of the lease in which Landlord is lessee, Tenant shall attorn to the
purchaser, transferee or lessor as the case may be, and recognize that party as
Landlord under this Lease, provided such party acquires and accepts the Premises
subject to this Lease.
25. TENANT ESTOPPEL CERTIFICATES.
Within ten (10) days after written request from Landlord, Tenant shall execute
and deliver to Landlord or Landlord's designee, a written statement certifying
(a) that this Lease is unmodified and in full force and effect, or is in full
force and effect as modified and stating the modifications; (b) the amount of
Base Rent and the date to which Base Rent and additional rent have been paid in
advance; (c) the amount of any security deposited with Landlord; and (d) that
Landlord is not in default hereunder or, if Landlord is claimed to be in
default, stating the nature of any claimed default. Any such statement may be
relied upon by a purchaser, assignee or lender. Tenant's failure to execute and
deliver such statement within the time required shall at Landlord's election be
a default under this Lease and shall also be conclusive upon Tenant that: (1)
this Lease is in full force and effect and has not been modified except as
represented by Landlord; (2) there are no uncured defaults in Landlord's
performance and that Tenant has no right of offset, counter-claim or deduction
against Rent; and (3) not more than one month's Rent has been paid in advance.
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26. TRANSFER OF LANDLORD'S INTEREST.
In the event of any sale or transfer by Landlord of the Premises, Building or
Project, and assignment of this Lease by Landlord, Landlord shall be and is
hereby entirely freed and relieved of any and all liability and obligations
contained in or derived from this Lease arising out of any act, occurrence or
omission relating to the Premises, Building, Project or Lease occurring after
the consummation of such sale or transfer, providing the purchaser shall
expressly assume all of the covenants and obligations of Landlord under this
Lease. If any security deposit or prepaid Rent has been paid by Tenant, Landlord
may transfer the security deposit or prepaid Rent to Landlord's successor and
upon such transfer. Landlord shall be relieved of any and all further liability
with respect thereto.
27. DEFAULT.
27.1. Tenant's Default. The occurrence of any one or more of the following
events shall constitute a default and breach of this Lease by Tenant:
a. If Tenant abandons the Premises without the payment of rent and other
charges; or
b. If Tenant fails to pay any Rent or any other charges required to be
paid by Tenant under this Lease and such failure or five (5) days after
such payment is due and payable; or
c. If Tenant fails to promptly and fully perform any other covenant,
condition or agreement contained in this Lease and such failure
continues for thirty (30) days after written notice thereof from
Landlord to Tenant; or
d. If a writ of attachment or execution is levied on this Lease or on
any of Tenant's Property and is not discharged within twenty (20) days;
or
e. If Tenant makes a general assignment for the benefit of creditors, or
provides for an arrangement, composition, extension or adjustment with
its creditors; or
f. If Tenant files a voluntary petition for relief or if a petition
against Tenant in a proceeding under the federal bankruptcy laws or
other insolvency laws is filed and not withdrawn or dismissed within
forty-five (45) days thereafter, of if under the provisions of any law
providing for reorganization or winding up of corporations, any court of
competent jurisdiction assumes jurisdiction custody or control of Tenant
or any substantial part of its property and such jurisdiction, custody
or control remains in force unrelinquished, unstayed or unterminated for
a period of forty-five (45) days; or
g. If in any proceeding or action in which Tenant is a party, a trustee,
receiver, agent or custodian is appointed to take charge of the Premises
or Tenant's Property (or has the authority to do so) for the purpose of
enforcing a lien against the Premises or Tenant's Property; or
h. If Tenant is a partnership or consists of more than one (l) person or
entity, if any partner of the partnership or other person or entity is
involved in any of the acts or events described in subparagraphs d
through g above.
27.2. Remedies. In the event of Tenant's default hereunder, then in addition to
any other rights or remedies Landlord may have under any law, Landlord shall
have the right, at Landlord's option, without further notice or demand of any
kind to do the following:
a. Terminate this Lease and Tenant's right to possession of the Premises
and reenter the Premises and take possession thereof, and Tenant shall
have no further claim to the Premises or under this Lease; or
b. Continue this Lease in effect, reenter and occupy the Premises for
the account of Tenant, and collect any unpaid Rent or other charges
which have or thereafter become due and payable; or
c. Reenter the Premises under the provisions of subparagraph b, and
thereafter elect to terminate this Lease and Tenant's right to
possession of the Premises.
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If Landlord reenters the Premises under the provisions of subparagraphs b or c
above, Landlord shall not be deemed to have terminated this Lease or the
obligation of Tenant to pay any Rent or other charges thereafter accruing,
unless Landlord notifies Tenant in writing of Landlord's election to terminate
this Lease. In the event of any re-entry or retaking of possession by Landlord,
Landlord shall have the right, but not the obligation to remove all or any part
of Tenant's Property in the Premises and to place such property in storage at a
public warehouse at the expense and risk of Tenant. If Landlord elects to relet
the Premises for the account of Tenant, the rent received by Landlord from such
reletting shall be applied as follows: first, to the payment of any indebtedness
other than Rent due hereunder from Tenant to Landlord; second, to the payment of
any costs of such reletting; third, to the payment of the cost of any
alterations or repairs to the Premises; fourth to the payment of Rent due and
unpaid hereunder; and the balance, if any, shall be held by Landlord and applied
in payment of future Rent as it becomes due. If that portion of rent received
from the relenting which is applied against the Rent due hereunder is less than
the amount of the Rent due. Tenant shall pay the deficiency to Landlord promptly
upon demand by Landlord. Such deficiency shall be calculated and paid monthly.
Tenant shall also pay to Landlord, as soon as determined, any costs and expenses
incurred by Landlord in connection with such reletting or in making alterations
and repairs to the Premises, which are not covered by the rent received from the
relating.
Should Landlord elect to terminate this Lease under the provisions of
subparagraph a or c above, Landlord may recover as damages from Tenant the
following:
1. Past Rent. The worth at the time of the award of any unpaid Rent which had
been earned at the time of termination; plus
2. Rent Prior to Award. The worth at the time of the 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 that Tenant proves
could have been reasonably avoided; plus
3. Rent After Award. The worth at the time of the award of the amount by which
the unpaid Rent for the balance of the Term after the time of award exceeds
the amount of the rental loss that Tenant proves could be reasonably
avoided; plus
4. Proximately Caused Damages. Any other amount necessary to compensate
Landlord for all detriment proximately caused by Tenant's failure to
perform its obligations under this Lease or which in the ordinary course of
things would be likely to result therefrom, including, but not limited to,
any costs or expenses (including attorneys' fees), incurred by Landlord in
(a) retaking possession of the Premises, (b) maintaining the Premises after
Tenant's default, (c) preparing the Premises for relating to a now tenant,
including any repairs or alterations, and (d) relating the Premises,
including broker's commissions.
"The worth at the time of the award" as used in subparagraphs 1 and 2 above, is
to be computed by allowing interest at the rate of ten percent (10%) per annum.
"The worth at the time of the award" as used in subparagraph 3 above, is to be
computed by discounting the amount at the discount rate of the Federal Reserve
Bank situated nearest to the Premises at the time of the award plus one percent
(1%).
The waiver by Landlord of any breach of any term, covenant or condition of this
Lease shall not be deemed a waiver of such term covenant or condition or of any
subsequent breach of the same or any other term, covenant or condition
Acceptance of Rent by Landlord subsequent to any breach hereof shall not be
deemed a waiver of any preceding breach other than the failure to pay the
particular Rent so accepted, regardless of Landlord's knowledge of any breach at
the time of such acceptance of Rent. Landlord shall not be deemed to have waived
any term, covenant or condition unless Landlord gives Tenant written notice of
such waiver.
27.3. Landlord's Default. If Landlord fails to perform any covenant, condition
or agreement contained in this Lease within thirty (30) days after receipt of
written notice from Tenant specifying such default, or if such default cannot
reasonably be cured within thirty (30) days, if Landlord fails to commence to
cure within that thirty (30) day period, then Landlord shall be liable to Tenant
for any damages sustained by Tenant as a result of Landlord's breach; provided,
however, it is expressly understood and agreed that if Tenant obtains a money
judgment against Landlord resulting from any default or other claim arising
under this Lease, that judgment shall be satisfied only out of the rents,
issues, profits, and other income actually received on account of Landlord's
right, title and interest in the Premises, Building or
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Project, and no other real, personal or mixed property of Landlord (or of any of
the partners which comprise Landlord, if any) wherever situated, shall be
subject to levy to satisfy such judgment. If, after notice to Landlord of
default, Landlord (or any first mortgagee or first dead of trust beneficiary of
Landlord) fails to cure the default as provided herein, then Tenant shall have
the right to cure that default at Landlord's expense. Tenant shall not have the
right to terminate this Lease or to withhold, reduce or offset any amount
against any payments of Rent or any other charges due and payable under this
Lease except as otherwise specifically provided herein.
28. BROKERAGE FEES.
Tenant warrants and represents that it has not dealt with any real estate broker
or agent in connection with this Lease or its negotiation except those noted in
Section 2.c. Tenant shall indemnify and hold Landlord harmless from any cost,
expense or liability (including costs of suit and reasonable attorneys' fees)
for any compensation, commission or fees claimed by any other real estate broker
or agent in connection with this Lease or its negotiation by reason of any act
of Tenant.
29. NOTICES.
All notices, approvals and demands permitted, or required to be given under this
Lease shall be in writing and deemed duly served or given if Personally
delivered or sent by certified or registered U.S. mail, postage prepaid, and
addressed as follows: (a) if to Landlord, to Landlord's Mailing Address and to
the Building manager, and (b) if to Tenant, to Tenant's Mailing Address;
provided, however, notices to Tenant shall be deemed duly served or given if
delivered or mailed to Tenant at the Premise. Landlord and Tenant may from time
to time by notice to the other designate another place for receipt of future
notices.
30. GOVERNMENT ENERGY OR UTILITY CONTROLS.
In the event of imposition of federal, state or local government controls,
rules, regulations, or restrictions on the use or consumption of energy or other
utilities during the Term, both Landlord and Tenant shall be bound thereby. In
the event of a difference in interpretation by Landlord and Tenant of any such
controls, the interpretation of Landlord shall prevail, and Landlord shall have
the right to enforce compliance therewith, including the right of entry into the
Premises to effect compliance.
31. QUIET ENJOYMENT.
Tenant, upon paying the Rent and performing all of its obligations under this
Lease, shall peaceably and quietly enjoy the Premises, subject to the terms of
this Lease and to any mortgage, lease, or other agreement to which this Lease
may be subordinate.
32. OBSERVANCE OF LAW.
Tenant shall not use the Premises or permit anything to be done in or about the
Premises which will in any way conflict with any law, statute, ordinance or
governmental rule or regulation now in force or which may hereafter be enacted
or promulgated. Tenant shall, at its sole cost and expense, promptly comply with
all laws, statutes, ordinances and governmental rules, regulations or
requirements now in force or which may hereafter be in force, and with the
requirements of any board of fire insurance underwriters or other similar bodies
now or hereafter constituted, relating to, or affecting the condition, use or
occupancy of the Premises, excluding structural changes not related to or
affected by Tenant's improvements or acts. The judgment of any court of
competent jurisdiction or the admission of Tenant in any action against Tenant,
whether Landlord is a party thereto or not, that Tenant has violated any law,
ordinance or governmental rule, regulation or requirement, shall be conclusive
of that fact as between Landlord and Tenant.
33. FORCE MAJEURE.
Any prevention, delay or stoppage of work to be performed by Landlord or Tenant
which is due to strikes, labor disputes, inability to obtain labor, materials,
equipment or reasonable substitutes therefor, acts of God, governmental
restrictions or regulations or controls, judicial orders, enemy or hostile
government actions, civil commotion, fire or other casualty, or other causes
beyond the reasonable control of the party obligated to perform hereunder, shall
excuse
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performance of the work by that party for a period equal to the duration of that
prevention, delay or stoppage. Nothing in this Article 33 shall excuse or delay
Tenant's obligation to pay Rent or other charges under this Lease.
34. CURING TENANT'S DEFAULTS.
If Tenant defaults in the performance of any of its obligations under this
Lease, Landlord may (but shall not be obligated to) without waiving such
default, perform the same for the account at the expense of Tenant. Tenant shall
pay Landlord all costs of such performance promptly upon receipt of a xxxx
therefor.
35. SIGN CONTROL.
Tenant shall not affix, paint, erect or inscribe any sign, projection, awning,
signal or advertisement of any kind to any part of the Premises. Building or
Project, including without limitation, the inside or outside of windows or
doors, without the written consent of Landlord. Landlord shall have the right to
remove any signs or other matter, installed without Landlord's permission,
without being liable to Tenant by reason of such removal, and to charge the cost
of removal to Tenant as additional rent hereunder, payable within ten (10) days
of written demand by Landlord.
36. MISCELLANEOUS.
a. Accord and Satisfaction; Allocation of Payments. No payment by Tenant
or receipt by Landlord of a lesser amount than the Rent provided for in
this Lease shall be deemed to be other than on account of the earliest
due Rent, nor shall any endorsement or statement on any check or letter
accompanying any check or payment as Rent be deemed an accord and
satisfaction, and Landlord may accept such check or payment without
prejudice to Landlord's right to recover the balance of the Rent or
pursue any other remedy provided for in this Lease. In connection with
the foregoing, Landlord shall have the absolute right in its solo
discretion to apply any payment received from Tenant to any account or
other payment of Tenant then not current and due or delinquent.
b. Addenda. If any provision contained in an addendum to this Lease is
inconsistent with any other provision herein, the provision contained in
the addendum shall control, unless otherwise provided in the addendum.
c. Attorneys' Fees. If any action or proceeding is brought by either
party against the other pertaining to or arising out of this Lease, the
finally prevailing party shall be entitled to recover all costs and
expenses, including reasonable attorneys' fees, incurred on account of
such action or proceeding.
d. Captions, Articles and Section Numbers. The captions appearing within
the body of this Lease have been inserted as a matter of convenience and
for reference only and in no way define, limit or enlarge the scope or
meaning of this Lease. All references to Article and Section numbers
refer to Articles and Sections in this Lease.
e. Changes Requested by Lender. Neither Landlord or Tenant shall
unreasonably withhold its consent to changes or amendments to this Lease
requested by the lender on Landlord's interest, so long as these changes
do not alter the basic business terms of this Lease or otherwise
materially diminish any rights or materially Increase any obligations of
the party from whom consent to such charge or amendment is requested.
f. Choice of Law. This Lease shall be construed and enforced in
accordance with the laws of the State.
g. Consent. Notwithstanding anything contained in this Lease to the
contrary, Tenant shall have no claim, and hereby waives the right to any
claim against Landlord for money damages by reason of any refusal,
withholding or delaying by Landlord of any consent, approval or
statement of satisfaction, and in such event, Tenant's only remedies
therefor shall be an action for specific performance, injunction or
declaratory judgment to enforce any right to such consent, etc.
h. ?????????????? that he is duly authorized to execute and deliver this
Lease on behalf of the corporation, and that this Lease is binding on
Tenant in accordance with Its terms. Tenant shall, at Landlord's
request, deliver a certified copy of a resolution of its board of
directors authorizing such execution.
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i. Counterparts. This Lease may be executed in multiple counterparts,
all of which shall constitute one and the same Lease.
j. Execution of Lease; No Option. The submission of this Lease to Tenant
shall be for examination purposes only, and does not and shall not
constitute a reservation of or option for Tenant to lease, or otherwise
create any interest of Tenant in the Premises or any other premises
within the Building or Project. Execution of this Lease by Tenant and
its return to Landlord shall not be binding on Landlord notwithstanding
any time interval, until Landlord has in fact signed and delivered the
Lease to Tenant.
k. Furnishing of Financial Statements; Tenant's Representations. In
order to induce Landlord to enter into this Lease, Tenant agrees that it
shall promptly furnish Landlord, from time to time, upon Landlord's
written request, with financial statements reflecting Tenant's current
financial condition. Tenant represents and warrants that all financial
statements, records and information furnished by Tenant to Landlord in
connection with this Lease are true, correct and complete in all
respects.
l. Further Assurances. The parties agree to promptly sign all documents
reasonably requested to give effect to the provisions of this Lease.
m. Mortgagee Protection. Tenant agrees to send by certified or
registered mail to any first mortgagee or first deed of trust
beneficiary of Landlord whose address has been furnished to Tenant, a
copy of any notice of default served by Tenant on Landlord. If Landlord
fails to cure such default within the time provided for In this Lease,
such mortgagee or beneficiary shall have an additional thirty (30) days
to cure such default; provided that If such default cannot reasonably be
cured within that thirty (30) day period, then such mortgagee or
beneficiary shall have such additional time to cure the default as is
reasonably necessary under the circumstances.
n. Prior Agreements; Amendments. This Lease contains all of the
agreements of the parties with respect to any matter covered or
mentioned in this Lease, and no prior agreement or understanding
pertaining to any such matter shall be effective for any purpose. No
provisions of this Lease may be amended or added to except by an
agreement in writing signed by the parties or their respective
successors in interest.
o. Recording. Tenant shall not record this Lease without the prior
written consent of Landlord. Tenant, upon the request of Landlord, shall
execute and acknowledge a "short form" memorandum of this Lease for
recording purposes.
p. Severability. A final determination by a court of competent
jurisdiction that any provision of this Lease is invalid shall not
affect the validity of any other provision, and any provision so
determined to be invalid shall, to the extent possible, be construed to
accomplish its intended effect.
q. Successors and Assigns. This Lease shall apply to and bind the heirs,
personal representatives, and permitted successors and assigns of the
parties.
r. Time of the Essence. Time is of the essence of this Lease.
s. Waiver. No delay or omission in the exercise of any right or remedy
of Landlord upon any default by Tenant shall impair such right of remedy
or be construed as a waiver of such default.
t. Compliance. The parties hereto agree to comply with all applicable
federal, state and local laws, regulations, codes, ordinances and
administrative orders having jurisdiction over the parties. property or
the subject matter of this Agreement, including, but not limited to, the
1964 Civil Rights Act and all amendments thereto, the Foreign investment
in Real Property Tax Act, the Comprehensive Environmental Response
Compensation and Liability Act, and The Americans With Disabilities Act.
The receipt and acceptance by Landlord of delinquent Rent shall not constitute a
waiver of any other default; it shall constitute only a waiver of timely payment
for the particular Rent payment involved.
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No act or conduct of Landlord, including, without limitation, the acceptance of
keys to the Premises, shall constitute an acceptance of the surrender of the
Premises by Tenant before the expiration of the Term. Only a written notice from
Landlord to Tenant shall constitute acceptance of the surrender of the Premises
and accomplish a termination of the Lease.
Landlord's consent to or approval of any act by Tenant requiring Landlord's
consent or approval shall not be deemed to waive or render unnecessary
Landlord's consent to or approval of any subsequent act by Tenant.
Any waiver by Landlord of any default must be in writing and shall not be a
waiver of any other default concerning the same or any other provision of the
Lease.
The parties hereto have executed this Lease as of the dates set forth below.
Date: July 8, 1996 Date: July 2, 1996
-------------------------------------- ---------------------
Landlord: The Parkwest Partners Tenant: Augment Systems
-------------------------------------- --------------------
By: /s/ Xxxxx Xxxx By: /s/ Xxxxx X. Xxxx
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Title: Title: CFO
-------------------------------------- --------------------
By: By: Xxxxx X. Xxxx
-------------------------------------- --------------------
Title: Title: CFO
-------------------------------------- --------------------
CONSULT YOUR ADVISORS - This document has been prepared for approval by your
attorney. No representation or recommendation is made by CB Commercial as to
the legal sufficiency or tax consequences of this document or the transaction
to which it relates. These are questions for your attorney.
In any real estate transaction, it is recommended that you consult with a
professional, such as a civil engineer, industrial hygienist or other person,
with experience in evaluating the condition of the property, including the
possible presence of asbestos, hazardous materials and underground storage
tanks.
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ADDENDUM
THIS IS AN ADDENDUM TO THAT CERTAIN OFFICE BUILDING LEASE DATED JULY 1, 1996, BY
AND BETWEEN THE PARKWEST PARTNERS, A LIMITED LIABILITY COMPANY, AS LANDLORD, AND
AUGMENT SYSTEMS, A DELAWARE CORPORATION, AS TENANT, FOR THE PROPERTY COMMONLY
KNOWN AS PARKWEST COURT, LOCATED AT 00000 XXXX XXXXXXXX XXXXX, XXXXX 000, XXXX
XX XXX XXXXX, XXXXXX OF SAN DIEGO, STATE OF CALIFORNIA.
========================================================
July 1, 1996
In the event of any inconsistency between the Addendum language and the body of
the Lease, the Addendum language shall prevail.
1. UTILITIES: Tenant shall pay its pro rata share of the metered utilities
to the property management.
2. TEMPORARY SPACE: Landlord shall permit Tenant to temporarily occupy
approximately 719 square feet on the second floor (Suite 216) of the
building until the tenant improvements are completed for Suite 255.
Tenant shall accept this space in an "as is" condition at $287.60 per
month, net of utilities (400 per square foot). This Temporary Occupancy
Agreement shall be on all the terms and conditions of this office
building lease dated July 1, 1996, except for applicable rent and
square footage issues.
Tenant shall reimburse Landlord for Landlord's actual costs in
restoring the Premises to their original condition as of the date of the
initial occupancy of the temporary space. In no event shall Tenant pay
any more than $500.00 for any repairs necessary to return the Suite to
its original condition.
3. TENANT IMPROVEMENTS: Landlord, at Landlord's expense, shall provide
building standard tenant improvements per a mutually acceptable space
plan, similar to Exhibit "A." Landlord, at Landlord's expense, shall
install melamine cabinets with Tenant's choice of either white or black
in color, a building standard sink and Formica counter with dimensions
and size as outlined on Exhibit "A." Landlord shall install half-height
interior glass in demo room wall as shown on Exhibit "A."
4. BASE RENT SCHEDULE: The Base Rent schedule shall be as follows:
Months 1 - 24 $2,299.87;
Months 25 - 36 $2,391.86;
Months 37 - 48 $2,487.54.
5. SIGNAGE: Landlord shall pay for Tenant's name to be placed on new
directory signage and lobby directories as well as suite signage for
Suite 255. Should Tenant desire interim signage for the temporary suite
on the 3rd floor, said signage shall be at Tenant's expense.
AGREED AND ACCEPTED:
LANDLORD: TENANT:
THE PARKWEST PARTNERS AUGMENT SYSTEMS
By: /s/ Xxxxx Xxxx By: Xxxxx X. Xxxx
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Date: July 8, 1996 Date: Juy 2, 1996
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EXHIBIT "D"
RULES AND REGULATIONS
1. No sign, placard, pictures, advertisement, name or notice shall be
inscribed, displayed or printed or affixed on or to any part of the
outside or inside of the Building without the written consent of Landlord
first had and obtained and Landlord shall have the right to remove any
such sign, placard, picture, advertisement, name or notice without notice
to and at the expense of Tenant.
All approved signs or lettering on doors shall be printed, painted,
affixed or inscribed at the expense of Tenant by a person approved by
Landlord outside the Premises; provided, however, that Landlord may
furnish and install a Building standard window covering at all exterior
windows. Tenant shall not, without prior written consent of Landlord,
cause or otherwise sunscreen any window.
2. The sidewalks, halls, passages, exists, entrances, elevators and
stairways shall not be obstructed by any of the tenants or used by them
for any purpose other than for ingress and egress from their respective
Premises.
3. Tenant shall not alter any lock or install any new or additional locks
or any bolts on any doors or windows of the Premises.
4. The toilet rooms, urinals, wash bowls and other apparatus shall not he
used for any purpose other than that for which they were constructed and
no foreign substance of any kind whatsoever shall be thrown therein and
the expense of any breakage, stoppage or damage resulting from the
violation of the rule shall be borne by the Tenant who, or whose
employees or invitees shall have caused it.
5. Tenant shall not overload the floor of the Premises or in any way deface
the Premises or any part thereof.
6. No furniture, freight or equipment of any kind shall be brought into the
Building without the prior notice to Landlord and all moving of the same
into or out of the Building shall be done at such time and in such manner
as Landlord shall designate. Landlord shall have the right to prescribe
the weight, size and position of all safes and other heavy equipment
brought into the Building and also the times arid mariner or moving the
same in and out of the Building. Safes or other heavy objects shall, if
considered necessary by Landlord, stand on supports of such thickness as
is necessary to properly distribute the weight. Landlord will not be
responsible for loss of or damage to any such safe or property from any
cause and all damage done to the Building by moving or maintaining any
such safe or other property shall be repaired at the expense of Tenant.
7. Tenant shall not use, keep or permit to be used or kept any foul or
noxious gas or substances in the Premises, or permit or suffer the
Premises to be occupied or used in a manner offensive or objectionable to
the Landlord or other occupants of the Building by reason of noise, odors
and/or vibrations, or interfere in any way with other tenants or those
having business therein, nor shall any animals or birds be brought in or
kept in or about the Premises or the Building.
8. No cooking shall be done or permitted by any Tenant on the Premises, nor
shall the Premises be used for the storage of merchandise, for washing
clothes, for lodging or for any improper, objectionable or immoral
purposes.
9. Tenant shall not use or keep in the Premises or the Building any
kerosene, gasoline or inflammable or combustible fluid or material, or
use any method of treating or air conditioning other than that supplied
by Landlord.
10. Landlord will direct electricians as to where and how telephone and
telegraph wires are to be introduced. No boring or cutting for wires will
be allowed without the consent of the Landlord. The location of
telephones, call boxes and other office equipment affixed to the Premises
shall be subject to the approval of Landlord.
11. On Saturdays, Sundays and legal holidays, and on other days between the
hours of 6:00 p.m. and 8:00 a.m. the following day, access to the
Building or to the hall, corridors, elevators or stairways in the
Building, or to the Premises may be refused unless the person seeking
access is known to the person or employee of the Building in charge and
has a pass or is properly identified. The Landlord shall in no case be
liable for damages for any
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error with regard to the admission to or exclusion from the Building of
any person. In case of invasion, mob, riot, public excitement, or other
commotion, the Landlord reserves the right to prevent access to the
Building during the continuance of the same by closing of the doors or
otherwise, for the safety of the tenants and protection of property in
the Building and the Building.
12. Landlord reserves the right to exclude or expel from the Building any
person who, in the judgment of Landlord, is intoxicated or under the
influence of liquor or drugs, or who shall in any manner do any act in
violation of any of the rules and regulations of the Building.
13. No vending machine or machines of any description shall be installed,
maintained or operated upon the Premises without the written consent of
the Landlord.
14. Landlord shall have the right, exercisable without notice and without
liability to Tenant, to change the name and street address of the
Building of which the Premises are a part.
15. Tenant shall not disturb, solicit, or canvass any occupant of the
Building and shall cooperate to prevent same.
16. Without the written consent of Landlord, Tenant shall not use the name of
the Building in connection with or in promoting or advertising the
business of Tenant except as Tenant's address.
17. Landlord shall have the right to control and operate the public portions
of the Building, and the public facilities, and heating and air
conditioning, as well as facilities furnished for the common use of the
tenants, in such manner as it deems best for the benefit of the tenants
generally.
18. All entrance doors in the Premises shall be left locked when the Premises
are not in use. and all doors opening to public corridors shall be kept
closed except for normal ingress and egress from the Premises.
/s/ B.W.S /s/ DAM
-------------------------------------- ---------------------
Landlord's Initials Tenant's Initials
-21-
EXHIBIT "F"
This Rider is attached to and made part of that certain Lease (the "Lease")
dated July 1, 1996 between The Parkwest Partners , as Landlord, and Augment
Systems, as Tenant, covering the Property commonly known as Parkwest Court (the
"Property"). The terms used herein shall have the same definitions as set forth
in the Lease. The provisions of this Rider shall supersede any inconsistent or
conflicting provisions of the Lease.
A. OPTION(S) TO EXTEND TERM.
1. GRANT OF OPTION.
Landlord hereby grants to Tenant one (1) option(s) (the "Option(s)")
to extend the Lease Term for additional term(s) of four (4) years each (the
"Extension(s)"), on the same terms and conditions as set forth in the Lease, but
at an increased rent as set forth below. Each Option shall be exercised only by
written notice delivered to Landlord at least one hundred twenty (120) days
before the expiration of the Lease Term or the preceding Extension of the Lease
Term, respectively. If Tenant fails to deliver Landlord written notice of
exercise of an Option within the prescribed time period, such Option and any
succeeding Options shall lapse, and there shall be no further right to extend
the Lease Term. Each Option shall be exercisable by Tenant on the express
conditions that (a) at the time of the exercise, and at all times prior to the
commencement of such Extension, Tenant shall not be in default under any of the
provisions of the Lease and (b) Tenant has not been ten (10) or more days late
in the payment of rent more than a total of three (3) times during the Lease
Term and all preceding Extensions.
2. PERSONAL OPTIONS.
The Option(s) are personal to the Tenant named in Section 1.03 of the
Lease or any Tenant's Affiliate described in Section 9,02 of the Lease. If
Tenant subleases any portion of the Property or assigns or otherwise transfers
any interest under the Lease to an entity other than a Tenant Affiliate prior to
the exercise of an Option (whether with or without Landlord's consent), such
Option and any succeeding Options shall lapse. If Tenant subleases any portion
of the Property or assigns or otherwise transfers any interest of Tenant under
the Lease to an entity other than a Tenant Affiliate after the exercise of an
Option but prior to the commencement of the respective Extension (whether with
or without Landlord's consent), such Option and any succeeding Options shall
lapse and the Lease Term shall expire as if such Option were not exercised. If
Tenant subleases any portion of the Property or assigns or otherwise transfers
any interest of Tenant under the Lease in accordance with Article 9 of the Lease
after the exercise of an Option and after the commencement of the Extension
related to such Option, then the term of the Lease shall expire upon the
expiration of the Extension during which such sublease or transfer occurred and
only the succeeding Options shall lapse.
B. CALCULATION OF RENT.
The Base Rent during the Extension(s) shall be determined by one or a
combination of the following methods (INDICATE METHOD UPON EXECUTION OF THE
LEASE):
[ ] 1. COST OF LIVING ADJUSTMENT (Section B. 1, below)
Rental Adjustment Date(s): The first day of the __________________
month(s) of the _________________ Extension(s) of the Lease Term.
[X] 2. Fair Rental Value Adjustment (Section B.2, below) as
determined by broker.
Rental Adjustment Date(s): The first day of the __________________
month(s) of the _________________ Extension(s) of the Lease Term.
[ ] 3. Fixed Adjustment
The Base Rent shall be increased to the following amounts (the
"Adjusted Base Rent(s)") on the dates (the "Rental Adjustment
Date(s)") set forth below:
Rental Adjustment Date(s) Adjusted Base Rent(s)
--------------------------- -----------------------
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--------------------------- -----------------------
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1. COST OF LIVING ADJUSTMENT.
The Base Rent shall be increased on the dates specified in Section
B.1, above (the "Rental Adjustment Date(s)") by reference to the Index defined
in Section 3.02 of the Lease or the substitute Index described in Paragraph
3.02(b) of the Lease, as follows: The Base Rent In effect Immediately prior to
the applicable Rental Adjustment Date (the "Comparison Base Rent") shall be
increased by the percentage that the Index has increased from the month in which
the payment of the Comparison Base Rent commenced through the month in which the
applicable Rental Adjustment Date occurs. In no event shall the Base Rent be
reduced by reason of such computation.
The Base Rent shall be increased on the date(s) specified in Section
B.2, above (the "Rental Adjustment Date(s)") to the "fair rental value" of the
Property, determined in the following manner:
(a) Not later than one hundred (100) days prior to any applicable
Rental Adjustment Date, Landlord and Tenant shall meet in an effort to
negotiate, in good faith, the fair rental value of the Property as of
such Rental Adjustment Date. It Landlord and Tenant have not agreed
upon the fair rental value of the Property at least ninety (90) days
prior to the applicable Rental Adjustment Date, the fair rental value
shall be determined by appraisal, by one or more appraisers or brokers
(herein called "Appraiser(s)"), as provided in Section B.2(b), below,
if appraiser(s) are used, such appraiser(s) shall have at least five
(5) years' experience In the appraisal of commercial/lindustrial real
property in the area in which the Property is located and shall be
members of professional organizations such as MAI or equivalent. If
broker(s) are used, such broker(s) shall have at least five (5) years'
experience in the sales and leasing of commercial /industrial real
property in the area in which the Property is located and shall be
members of professional organizations such as the Society of Industrial
and Office Realtors or equivalent.
(b) If Landlord and Tenant are not able to agree upon the fair rental
value of the Property within the prescribed time period, then Landlord
and Tenant shall attempt to agree in good faith upon a single Appraiser
not later than seventy-five (75) days prior to the applicable Rental
Adjustment Date. If Landlord and Tenant are unable to agree upon a
single Appraiser within such time period, then Landlord and Tenant
shall each appoint one Appraiser not later than sixty-five (65) days
prior to the applicable Rental Adjustment Date. Within ten (10) days
thereafter, the two (2) appointed Appraisers shall appoint a third
(3rd) Appraiser. It either Landlord or Tenant fails to appoint its
Appraiser within the prescribed time period, the single Appraiser
appointed shall determine the fair rental value of the Property. If
both parties fail to appoint Appraisers within the prescribed time
periods, then the first Appraiser thereafter selected by a party shall
determine the fair rental value of the Properly. Each party shall bear
the cost of its own Appraiser and the parties shall share equally the
cost of the single or third Appraiser, if applicable.
(c) For the purposes of such appraisal, the term "fair market value"
shall mean the price that a ready and willing tenant would pay, as of
the applicable Rental Adjustment Date, as monthly rent to a ready and
willing landlord of property comparable to the Property if such
property were exposed for lease on the open market for a reasonable
period of time and taking into account all of the purposes for which
such property may be used. If a single Appraiser is chosen, then such
Appraiser shall determine the fair rental value of the Property.
Otherwise, the fair rental value of the Property shall be the
arithmetic average of the two (2) of the three (3) appraisals which are
closest in amount, and the third appraisal shall be disregarded. In no
event, however, shall the Base Rent be reduced by reason of such
computation. Landlord and Tenant shall instruct the Appraiser(s) to
complete the determination of the fair rental value not later than
thirty (30) days prior to the applicable Rental Adjustment Date. If the
fair rental value is not determined prior to the applicable Rental
Adjustment Date, then Tenant shall continue to pay to Landlord the Base
Rent applicable to the Property immediately prior to such Extension,
until the fair rental value is determined. When the fair rental value
of the Property is determined, Landlord shall deliver notice thereof to
Tenant, and Tenant shall pay to Landlord, within ten (10) days after
receipt of such notice, the difference between the Base Rent actually
paid by Tenant to Landlord and the new Base Rent determined hereunder.
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