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EXHIBIT 10.18
STANDARD FORM
MULTI-TENANCY INDUSTRIAL LEASE
(TRIPLE NET)
Landlord Eastgroup Properties, a Maryland Real Estate Investment Trust,
c/o Hewson Properties, Inc.,
Tenant Anasazi, Inc., a Delaware Corporation
Dated as of January 31, 1997
TABLE OF CONTENTS
1. Defined Terms .................................................................... 1
2. Leased Premises .................................................................. 2
(a) Property to be Leased ...................................................... 2
(b) Common Areas ............................................................... 2
(c) Reserved Rights of Landlord ................................................ 2
3. Completion of Premises ........................................................... 3
(a) Plans ...................................................................... 3
(b) Scheduled Commencement Date ................................................ 3
(c) Remedy ..................................................................... 3
(d) Changes .................................................................... 3
(e) Ready for Occupancy ........................................................ 3
(f) Construction Representative ................................................ 4
(g) Early Entry ................................................................ 4
(h) Quality of Construction .................................................... 4
4. Term ............................................................................. 4
5. Rent ............................................................................. 4
(a) Fixed Rent ................................................................. 4
(c) Pro Rata Rent .............................................................. 5
(d) Net Lease .................................................................. 5
(e) Reimbursable Expenses ...................................................... 5
6. Security ......................................................................... 6
(a) Security Deposit ........................................................... 6
7. Use .............................................................................. 7
(a) General .................................................................... 7
(b) Compliance with Law ........................................................ 7
(c) Existing Title and Condition of Premises ................................... 7
(d) Signs ...................................................................... 7
(e) Governmental Regulation .................................................... 8
(f) Security Devices ........................................................... 8
8. Maintenance and Repairs .......................................................... 8
(a) Operating Expenses ......................................................... 8
(b) Tenant's Maintenance ....................................................... 9
(c) Landlord's Obligations to Repair ........................................... 9
(d) Surrender .................................................................. 9
9. Utilities ........................................................................ 9
10. Alterations and Additions ....................................................... 10
(a) Limitation ................................................................. 10
(b) Liens ...................................................................... 10
(c) Removal .................................................................... 10
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11. Insurance ....................................................................... 10
(a) General Liability .......................................................... 10
(b) Extended Coverage .......................................................... 10
(c) Policies ................................................................... 11
(d) Waiver of Subrogation ...................................................... 11
(e) Tenant's Contents .......................................................... 11
(f) Workmen's Compensation ..................................................... 12
12. Indemnity; Exemption of Landlord from Liability ................................. 12
(a) General .................................................................... 12
(b) Tenant's Business .......................................................... 12
13. Damage or Destruction; Obligation to Rebuild .................................... 12
(a) Landlord's Obligation to Rebuild ........................................... 12
(b) Abatement of Rent .......................................................... 12
(c) Option to Terminate ........................................................ 12
(d) Uninsured Casualties ....................................................... 13
(e) Tenant's Waiver ............................................................ 13
14. Taxes ........................................................................... 13
(a) Tenant's Share of Property Taxes ........................................... 13
(b) Tenant's Personal Property ................................................. 13
(c) Rent Tax ................................................................... 14
15. Condemnation .................................................................... 14
(a) Rent Reduction or Lease Termination ........................................ 14
(b) Award ...................................................................... 14
16. Assignment and Subletting ....................................................... 15
(a) Consent .................................................................... 15
(b) Tenant's Continuing Liability .............................................. 15
(c) Information ................................................................ 15
(d) Excess Sublease Rental ..................................................... 15
(e) Release .................................................................... 15
(f) Controlled Entity .......................................................... 16
(g) Attorneys' Fees ............................................................ 16
17. Defaults; Remedies .............................................................. 16
(a) Defaults ................................................................... 16
(b) Remedies ................................................................... 17
(c) Late Charges ............................................................... 19
(d) Payment or Performance by Landlord ......................................... 19
18. Miscellaneous ................................................................... 19
(a) Estoppel Certificate ....................................................... 19
(b) Landlord's Liability ....................................................... 20
(c) Construction ............................................................... 20
(d) Interest on Past-Due Obligations ........................................... 20
(e) Time of Essence ............................................................ 20
(f) Counterparts ............................................................... 20
(g) Incorporation of Prior Agreements; Amendments .............................. 20
(h) Notices .................................................................... 20
(i) Waivers .................................................................... 20
(j) Recording .................................................................. 21
(k) Holding Over ............................................................... 21
(l) Covenants and Conditions ................................................... 21
(m) Binding Effect ............................................................. 21
(n) Subordination .............................................................. 21
(o) Attorneys' Fee ............................................................. 21
(p) Landlord's Access .......................................................... 21
(q) Auctions ................................................................... 21
(r) Merger ..................................................................... 22
(s) Joint and Several Liability ................................................ 22
(t) Individual Liability ....................................................... 22
(u) Attornment ................................................................. 22
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(v) Lenders Right to Cure ...................................................... 22
(w) Revisions to Lease ......................................................... 22
(x) Administrative Charge ...................................................... 22
19. Toxic Materials ................................................................. 23
(a) Definitions ................................................................ 23
(b) Prohibition on Hazardous Materials ......................................... 23
(c) Exception to Prohibition ................................................... 24
(d) Compliance with Environmental Laws ......................................... 24
(e) Environmental Notices ...................................................... 24
(f) Environmental Indemnity .................................................... 24
(g) Remedial Work .............................................................. 25
(h) Landlord's Option .......................................................... 25
(i) Injunctive Relief .......................................................... 25
(j) Self-Help .................................................................. 25
(k) Other Tenants .............................................................. 25
(l) Environmental Inspection ................................................... 25
(m) Surrender of Premises-Environmental Considerations ......................... 26
Exhibit A The Premises
Exhibit B Preliminary Plans
Exhibit D Hazardous Materials
Exhibit E Option to Extend Lease Term
Exhibit F First Right of Refusal
Exhibit G First Right of Refusal Floor Plan
Exhibit H Project
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1. DEFINED TERMS. Each reference in this Lease to any of the following
terms shall incorporate the data stated for that term. Other terms are as
defined in the Lease.
(a) LANDLORD AND LANDLORD'S EastGroup Properties
ADDRESS (SUBPARAGRAPH c/o Hewson Properties, Inc.
18(h)): 0000 Xxxx Xxxxxxxxxx Xxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
(b) TENANT AND TENANT'S ANASAZI, Inc., ATTN: XXXXX XXXXXXXXX
ADDRESS FOR NOTICES 0000 X. Xxxxxx Xxxx Xxxxx, Xxxxx 000
(SUBPARAGRAPH 18(H)): Xxxxxxx, Xxxxxxx 00000-0000
cc: Xx. Xxxxx Xxxxx
CB Commercial
(c) XXXXXX XXXXXXX XX XXXXXXXX 0000 Xxxxx Xxxxxxx, #000
(PARAGRAPH 2): Xxxxxxx, Xxxxxxx 00000
See Page 1(a)
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(d) APPROXIMATE SQUARE Approximately A-104 - 13,200 SF
FOOTAGE OF PREMISES " A-103 - 5,881 SF
(PARAGRAPH 2) " A-102 - 8,600 SF
(e) PROJECT IN WHICH PREMISES Metro Business Park Phase I
ARE LOCATED which consists of three (3) buildings
(PARAGRAPH 2) on Exhibit A
(f) LANDLORD'S CONSTRUCTION Xxxxxxxx X. Xxxxxx
REPRESENTATIVE (SUBPARAGRAPH
3(f)): --------------------------------------
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(g) TENANT'S CONSTRUCTION Xxxxx Xxxxxxxxx
REPRESENTATIVE (SUBPARAGRAPH
3(f)) --------------------------------------
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(h) TERM (PARAGRAPH 4): A104 - 2/15-97 - 3/31/00
A102 - 4/01/97 - 3/31/00
A103 - 4/01/97 - 11/30/01
(i) SCHEDULE COMMENCEMENT 12:01 a.m. on
DATE (PARAGRAPH 4): A104 - February 15, 1997
A102 & A103 - April 1, 1997
(j) FIXED RENT (SUBPARAGRAPH
5(a)): 2/15/97 - 3/31/97 @ $ 5,105.99/NNN/ (A104)
4/01/00 - 3/31/00 @ $18,000.00/NNN/ Month (All)
4/01/00 - 11/30/01 @ $ 3,234.55/NNN/ Month (A103)
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per month
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(k) RENTAL PERIOD February 15, 1997 - November 30, 2001
SUBPARAGRAPH 5(a)):
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(l) SECURITY DEPOSIT $27,000.00
PARAGRAPH 6(a)):
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1.(c) STREET ADDRESS OF PREMISES. 00000 X. 00xx Xxxxxx
Xxxxxx X000-X000
Xxxxxxx, XX 00000
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(m) PERMITTED USES (PARA- Data Center, Call Center and
GRAPH 7): -----------------------------------
general office use.
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(n) CLEANING DEPOSIT (SUB- Waived
PARAGRAPH 8(e)): ------------------------------------
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(o) TENANT'S SHARE OF 78.64%; provided, however, if any
OPERATING EXPENSES such Expenses or Taxes are not
(PARAGRAPH 8), IN- specifically identifiable as
SURANCE EXPENSES (PARA- attributable solely to the Building
GRAPH 11) AND PROPERTY and the real property immediately
TAXES (PARAGRAPH 14): adjacent to the Building but are
attributable to the Project,
Tenant's Share of such Expenses and
Taxes shall be 27.57%
(p) LIABILITY INSURANCE $2,000,000.00
(SUBPARAGRAPH 11(a)): ------------------------------------
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2. LEASED PREMISES. (a) PROPERTY TO BE LEASED. Landlord hereby leases
to Tenant, and Tenant hereby leases from Landlord, subject to the terms and
conditions contained herein certain floor space (the "Premises") located in the
building (the "Building") located (or to be constructed) on that certain real
property located at the street address set forth in paragraph 1 hereof (the
"Property"). The Building is located in Landlord's Project set forth in
paragraph 1 above. The Premises, which are more particularly described on
Exhibit A attached hereto and incorporated herein by this reference, shall be
deemed to extend from the top surface of subfloor to the bottom surface of roof
above but shall not include the common stairways, stairwells, hallways,
accessways, and pipes, ducts, conduits, wires and appurtenant fixtures serving
exclusively or in common other parts of the Building, and (if the Premises
include less than the entire rentable area of any floor) shall not include the
remainder of the Floor Common Area (as defined below). The Approximate Square
Footage of the Premises is set forth in paragraph 1 above.
(b) COMMON AREAS. Tenant shall have, as appurtenant to the Premises,
rights to use in common, subject to reasonable rules from time to time made by
Landlord of which Tenant is given notice:
(i) The common stairways and accessways, loading docks and
platforms and any passageways thereto, and the common pipes, ducts,
conduits, wires appurtenant equipment serving the Premises;
(ii) If the Premises include less than the entire rentable
area of any floor, the common lobbies, hallways, toilets and other
common facilities (the "Floor Common Area"); and
(iii) Common walkways, sidewalks, and driveways necessary for
access to the Building; greenbelt areas; and except for parking spaces
which may be reserved for persons other than Tenant, parking spaces or
area from time to time maintained on the Project for use by tenants in
and visitors to the Building and, to the extent from time to time
arranged by Landlord, maintained on adjacent real property for such
use.
(c) RESERVED RIGHTS OF LANDLORD. Notwithstanding the foregoing,
Landlord reserves the right from time to time, without unreasonable interference
with Tenant's use:
(i) To install, use, maintain, repair and replace pipes,
ducts, conduits, wires and appurtenant meters and equipment for service
to other parts of the Building above the ceiling surfaces, below the
floor surfaces, within the walls and in the central core areas, and to
replace any pipes, ducts, conduits, wires and appurtenant meters and
equipment included in the Premises which are so located or located
elsewhere outside the Premises;
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(ii) To alter or relocate any other common facility; provided,
however, that substitutions are substantially equivalent or better in
quality; and
(iii) To alter the boundaries of the Property, grant easements
on the Property and dedicate for public use portions thereof without
Tenant's consent, provided that no such grant or dedication shall
unreasonably interfere with Tenant's use of the Premises or otherwise
cause Tenant to incur cost or expense.
3. COMPLETION OF PREMISES. (a) PLANS. Landlord and Tenant have approved
the preliminary plans and outline specifications (the "Preliminary Plans")
identified in Exhibit B for the construction of improvements in and to the
Premises. If necessary, Tenant shall cause to be prepared final plans and
specifications (the "Final Plans") substantially in conformity with the
Preliminary Plans, which need not include working detail drawings. The term
"Plans" shall hereinafter mean the Preliminary Plans and, if and when prepared,
the Final Plans. The Final Plans, if necessary, shall be delivered to Tenant as
soon as reasonably possible from the date hereof, subject to any period of delay
encountered by Tenant in such preparation as a result of requests by Landlord
for changes in the Final Plans subsequent to the date hereof. Within ten (10)
days after delivery of the Final Plans, Tenant shall set forth in writing, with
particularity and precision, any corrections or changes necessary to bring the
Final Plans into substantial conformity with the Preliminary Plans, except that
Tenant may not object to any logical development or refinement of the
Preliminary Plans. Failure to deliver to Landlord written notice of any such
corrections or changes within said ten (10) day period shall constitute approval
of the Final Plans by Tenant. Following such approval of the Final Plans, both
parties shall endorse approval for filing purposes thereon, in duplicate, and
thereafter changes may be made only in accordance with subparagraph (d) below.
(b) SCHEDULED COMMENCEMENT DATE. Tenant, at its sole expense, shall
proceed diligently with construction and completion of the Premises
substantially in accordance with the Plans. Tenant shall complete the Premises
and they shall be Ready for Occupancy (as defined below) by Tenant on
approximately the Scheduled Commencement Date set forth in paragraph 1 above;
provided, however, that such Scheduled Commencement Date shall be extended for a
period of time equal to the period of any delay or delays encountered by
Landlord affecting construction because of fire, earthquake, inclement weather,
or other acts of God, acts of the public enemy, riot, insurrection,
governmental regulations of the sales of materials or supplies or the
transportation thereof, strikes or boycotts, shortages of material or labor,
Tenant's early entry under the provisions of subparagraph (g) below, changes in
the Plans pursuant to subparagraph (d) below, or any other cause beyond the
control of Landlord.
(d) CHANGES. Tenant shall have the right to request changes in the
Plans, which request shall not be unreasonably denied, provided, however, that:
(i) such right shall not be exercised unreasonably, (ii) no such request shall
affect any structural change in the Premises.
(e) READY FOR OCCUPANCY. The Premises shall be deemed to be ready for
occupancy ("Ready for Occupancy") when the architect or engineer in charge of
the work of construction certifies: (i) that the work of construction has been
substantially completed in accordance with the Plans; and (ii) the date of such
completion. Tenant shall diligently complete, as soon as
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reasonably possible, any items work and adjustment not completed when the
Premises are Ready for Occupancy.
(f) CONSTRUCTION REPRESENTATIVE. In connection with the original
construction of the Premises each party shall be bound by its Construction
Representative set forth in paragraph 1 above. A party may designate a
substitute Construction Representative by giving written notice to the other
party.
(g) EARLY ENTRY. With the prior written consent of Landlord, Tenant
may, at any time prior to the commencement of the Term, at its sole risk, enter
upon and install such trade fixtures and equipment in the Premises as it may
elect; provided, however, that (ii) Tenant shall execute an indemnity agreement
in favor of Landlord in form and substance satisfactory to Landlord; (iii)
Tenant shall pay for and provide evidence of insurance satisfactory to Landlord;
and (iv) Tenant shall pay utility charges reasonably allocated to Tenant by
Landlord. Tenant shall not use the Premises for the storage of inventory or
otherwise commence the operation of business prior to the commencement of the
operation of business prior to the commencement of the Term without the express
prior written consent of Landlord.
(h) QUALITY OF CONSTRUCTION. All work shall be done in a good and
workmanlike manner and in compliance with all applicable laws and lawful
ordinances, bylaws, regulations and orders of governmental authority and of the
insurers of the Improvements. Landlord assumes no liability for special,
consequential or incidental damages of any kind. There are no representations,
warranties or guaranties, express or implied, including warranties of
merchantability or use of the Premises, except as are expressly set forth
herein. Tenant hereby waives the benefit of any rule that disclaimers of
warranty shall be construed against Landlord.
4. TERM. The Term of this Lease, which shall be for the period set
forth in paragraph 1 above, shall commence on the first to occur of the
following dates (the "Commencement Date") (it being agreed that if the Term of
this Lease shall not commence within one (1) year of the Scheduled Commencement
Date this Lease shall terminate and be of no further force and effect):
(a) The date on which Suite A102 or A103 is ready for occupancy, or
(b) The date on which Tenant actually commences to do business in
Suites A102 or A103.
5. RENT. (a) FIXED RENT. Tenant shall pay Landlord as fixed rent for
the Premises a sum equal to the Fixed Rent set forth in paragraph 1 on or before
the first day of each and every calendar month during the Term of this Lease,
except that Fixed Rent for the first full calendar month of the Term shall be
payable simultaneously with the execution of this Lease by Tenant.
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4. Term. (d) The commencement date on Suite A104 will be no later than
February 15, 1997.
(e) The commencement date on Suites A103 and A102 will be no
later than twelve (12) weeks after both parties have executed the
lease unless as extended pursuant to paragraph 3(b).
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(c) PRO RATA RENT. Rent for any period during the Term which
is for less than one month shall be a pro rata portion of the Rental
Period installment. Rent shall be payable, without deduction or
offset, in lawful money of the United States to Landlord at the
address stated herein or to such other persons or at such other
places as Landlord may designate in writing.
(d) NET LEASE. This Lease is what is commonly called a "net
lease", it being understood that Landlord shall receive the Rent set
forth in this paragraph free and clear of any and all impositions,
taxes, except income taxes, liens, charges or expenses of any nature
whatsoever in connection with its ownership and leasing of the
Premises. In addition to the Rent provided in this paragraph, Tenant
shall pay all impositions, taxes, insurance premiums, operating
charges, costs and expenses which arise or may be contemplated
under any provisions of this Lease during the Term. All of such
charges, costs and expenses shall constitute additional rent, and
upon the failure of Tenant to pay any of such costs, charges or
expenses, Landlord shall have the same rights and remedies as
otherwise provided in this Lease for the failure of Tenant to pay
Rent. It is the intention of the parties hereto that Tenant shall in
no event be entitled to any abatement of or reduction in Rent or
additional rent payable hereunder, except as expressly provided
herein.
(e) REIMBURSABLE EXPENSES. The sums payable by Tenant for
Operating Expenses, Insurance Expenses and Property, Taxes
(hereinafter sometimes cumulatively referred to as the "Reimbursable
Expenses") under subparagraphs 8(a), 11(b) and 14(a) of this Lease
shall be paid in accordance with the following procedures:
(i) Landlord shall prepare an annual statement (the
"Annual Statement") setting forth the sum of the Reimbursable
Expenses for the calendar year ending on the prior December 31
and Tenant's Share thereof and setting forth the estimated
Reimbursable Expenses that will be incurred by Landlord during
the current calendar year ending on the next following
December 31 and Tenant's Share thereof.
(ii) Landlord shall endeavor to give to Tenant such
Annual Statement on or before March 1 of each calendar year
throughout the Term of the Lease, but Landlord's failure to
provide Tenant with an Annual Statement by said date shall not
constitute a
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2.(b) (iv)
Landlord shall provide, throughout the initial term and any
renewal option periods, employee and visitor parking in the
building area for one hundred (100) cars. All one hundred
(100) stalls shall be reserved and free for the initial term
and any renewal option periods. Parking will be uncovered and
the number of stalls will be reduced in proportion with their
leased square footage.
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waiver by Landlord of its right to require payment by Tenant
of Tenant's Share of estimated Reimbursable Expenses or actual
Reimbursable Expenses.
(iii) Tenant's Share of estimated Reimbursable
Expenses for the calendar year in which the Annual Statement
is received shall be divided by twelve (12) and one such
installment shall be paid concurrently with each rental
payment thereafter until receipt by Tenant of the next Annual
Statement. In addition, Tenant shall pay in full concurrently
with the first monthly rent payment due following receipt of
the Annual Statement an amount equal to the excess of the
monthly installment required to be paid under the most current
Annual Statement over the monthly installment made under the
preceding Annual Statement (or the amount specified in
subparagraph (v) below, as applicable) multiplied by the
number of months from January through the month in which the
Annual Statement is received by Tenant.
(iv) If Tenant's Share of actual Reimbursable
Expenses for the past calendar year as shown on the Annual
Statement is greater than the payments made by Tenant for that
calendar year, then concurrently with the first monthly rent
payment due following receipt by Tenant of the Annual
Statement, Tenant shall pay in full an amount equal to such
excess. If Tenant's Share of actual Reimbursable Expenses for
the past calendar year as shown on the Annual Statement is
less than the payments made by Tenant for that calendar year,
the amount of such overpayment shall be credited against the
next monthly rent payment(s) falling due.
(vi) Even though the Term has expired and the Tenant
has vacated the Premises when the final determination is made
of Tenant's Share for the calendar year in which the Lease
expires, Tenant shall immediately pay the excess of Tenant's
Share for the portion of such year in which Tenant was in
occupancy over the estimated payments made by Tenant for that
calendar year and, conversely, any overpayment made shall be
immediately rebated by Landlord to Tenant.
(vii) An administrative charge equal to five percent
(5%) of the Reimbursable Expenses shall be added to each
installment payment due under this subparagraph (e) (including
the estimated payments and any reconciliation payment), which
administrative charge shall be reflected in the Annual
Statement, shall be payable in addition to the Reimbursable
Expenses and shall be intended to compensate Landlord for
supervision, administrative and clerical costs.
(viii) Each Annual Statement shall be prepared in
accordance with GAAP and each determination and Annual
Statement, certified by Landlord, shall be final and
conclusive on both parties, including any determination made
by Landlord of the appropriate estimated payment during the
period prior to issuance of the first Annual Statement to
Tenant.
6. SECURITY. (a) SECURITY DEPOSIT. Tenant shall deposit with
Landlord upon execution hereof the Security Deposit set forth in
paragraph 1 above as security for Tenant's faithful performance of
Tenant's obligations hereunder. If Tenant fails to pay Rent or any
other charges payable by Tenant hereunder, or otherwise defaults with
respect to any provision of this Lease, Landlord may at its option use,
apply or retain all or any portion of the Security Deposit (i) to
remedy Tenant's defaults in the payment of Rent or any other sums
payable by Tenant pursuant to the terms hereof, (ii) to repair any
damage to the Premises, (iii) to clean and otherwise maintain the
Premises, or (iv) to compensate Landlord for any other loss or damage
which Landlord may suffer thereby. If Landlord so uses or applies all
or any portion of the
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5.e(ix)
Tenant may audit the Landlord records pertaining to Tenant only. The
audit will take place at the Xxxxxx Properties, Inc., headquarters with
time given to the Landlord to pull records out of storage. Tenant may
have up to nine months after receipt of actual expense reconciliation
for the prior year to audit Landlord's records.
If audit reveals ten percent (10%) or over miscalculation, then
Landlord will pay for the audit.
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Security Deposit, Tenant shall, within ten (10) days after written
demand therefor, deposit cash with Landlord in an amount sufficient
to restore the Security Deposit to the full amount hereinabove
stated and Tenant's failure to do so shall be a breach of and a
default under this Lease. Landlord shall not be required to keep the
Security Deposit separate from its general accounts. If Tenant
performs all of Tenant's obligations hereunder, the Security
Deposit, or so much thereof as has not theretofore been applied by
Landlord, shall be returned, without payment of interest or other
increment for its use, to Tenant (or, at Landlord's option, to the
last assignee, if any, of Tenant's interest hereunder) at the
expiration of the Term hereof, after Tenant has vacated the
Premises.
7. USE. (a) GENERAL. The Premises shall be used and occupied
only for the Permitted Uses set forth in paragraph 1 above and for
no other purpose.
(b) COMPLIANCE WITH LAW. Tenant shall, at Tenant's sole cost
and expense, comply with all present and future laws, ordinances,
orders, declarations of covenants and restrictions, rules,
regulations and requirements of all federal, stare and municipal
governments, courts, departments, or any other body exercising
functions similar to those of any of the foregoing, foreseen or
unforeseen, ordinary as well as extraordinary; which may be
applicable to the Premises, the Building, and the Property or to
the use or manner of use of the Premises. Tenant shall obtain any
required certificate of occupancy with respect to its use of the
Premises, the Building and the Property within thirty (30) days from
the Commencement Date and shall deliver a copy thereof to Landlord
within such thirty (30) day period; provided, however, Landlord
shall obtain any certificate of occupancy required for the shell of
the Building and any improvements to the Premises to be made by
Landlord pursuant to paragraph 3 above. Tenant shall not use or
permit the use of the Premises in any manner that will tend to
create waste or a nuisance.
(c) EXISTING TITLE AND CONDITION OF PREMISES. Tenant hereby
accepts the Premises in their condition existing as of the
Commencement Date and also accepts the Premises and this Lease
subject to all applicable zoning, municipal, county and state laws,
ordinances and regulations governing and regulating the use of the
Premises, subject to all covenants, conditions and restrictions
affecting the Property, Project or Premises and subject to all
liens, claims and encumbrances currently existing against the
Premises or any part thereof, including all matters disclosed by any
of the foregoing or by any exhibits attached hereto. Landlord, in
accordance with (and except as otherwise provided in) subparagraph
8(c) below, shall be responsible for causing the roof and bearing
walls of the Premises to be in good condition and repair at the
Commencement Date and shall also cause the heating, ventilating and
air conditioning system, the plumbing system and the electrical
system to be in good operating condition as of the Commencement
Date. All such systems shall be deemed in the condition required at
the Commencement Date unless Tenant gives Landlord written notice of
any defects in such systems on or before thirty (30) days after the
Commencement Date. Except for any representation or warranty which
may be specifically set forth in this Lease, Tenant acknowledges
that neither Landlord nor Landlord's agents have made any
representations or warranties as to the Premises, including without
limitation, any representation or warranty as to condition or
fitness of the Building or the suitability of the Building for the
conduct of Tenant's business.
(d) SIGNS. Tenant shall not erect or install on any exterior
or interior window, any door, or any exterior wall any signs,
advertising media, placards, trademarks, drapes, screens, tinting
materials, shades, blinds or similar items, without first securing
Landlord's written permission. Landlord's permission will not be
unreasonably withheld. All signs shall comply with all applicable
governmental requirements, shall conform
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to the design, motif and decor of the Property and shall be in good
taste, as determined in Landlord's reasonable discretion. Landlord
may also establish such sign criteria as Landlord deems appropriate
for the Property and Tenant shall cause all signs which are located
on the Premises and are visible from outside the Premises to conform
to such sign criteria. Tenant shall properly maintain all approved
signs. Upon expiration of the Lease, Tenant promptly shall remove
all signs placed in and around the Premises by Tenant and shall
repair any damage to the Premises, Building or other portions of the
Project caused by the removal of such signs.
(e) GOVERNMENTAL REGULATION. In addition to the general
obligation of Tenant to comply with laws and without limitation
thereof, Landlord shall not be liable to Tenant nor shall this Lease
be affected if any parking privileges appurtenant to the Premises,
the Building and the Property are impaired by reason of any
moratorium, initiative, referendum, statute, regulation, or other
governmental decree or action which could in any manner prevent or
limit the parking rights of Tenant hereunder. See Page 8A. Any
governmental charges or surcharges or other monetary obligations
imposed relative to parking rights with respect to the Premises, the
Building and the Property shall be considered as Property Taxes and
shall be payable by Tenant under the provisions of paragraph 14
hereof.
(f) SECURITY DEVICES. Tenant may not install any alarm boxes,
foil protection tape or other security equipment on the Premises
without Landlord's prior written consent. Landlord's permission
will not be unreasonably withheld.
8. MAINTENANCE AND REPAIRS. (a) OPERATING EXPENSES. As
additional rent during the Term, Tenant shall pay to Landlord an
amount equal to the product obtained by multiplying (i) Tenant's
Share of Operating Expenses (as set forth in paragraph 1 above) by
(ii) the amount which Landlord expends for Operating Expenses for
the Term hereof. "Operating Expenses" shall include all reasonable
and necessary expenses actually incurred by Landlord for the
operation, cleaning, maintenance (including but not limited to
preventive maintenance), repair and property management of the
Building and the Property and, if applicable, the Project,
including, without limitation, the roof and walls (other than for
the structural repair of such roof and walls), utility systems and
related equipment serving all of the Building or the Project and all
walks, driveways, parking areas, loading areas, lawns and
landscaping. Among the items included in Operating Expenses under
the foregoing definition are expenses for utilities furnished to the
common areas of the Building and Property and fees and charges paid
to the property manager for the Building; provided, however, the
amount of the property manager's fee included in Operating Expenses
of the Building for any calendar year shall not exceed an amount
equal to five percent (5%) of the gross receipts received by
Landlord from the Building for such calendar year. If Landlord
determines that a utility system and related equipment or portion
thereof serves one or more tenant suites in addition to the Premises
but less than all of the tenant suites in the Building or the
Project, the system and equipment or portion thereof, as applicable,
which serves the Premises and such additional suites, to the extent
the operation, cleaning, maintenance, repair and/or replacement
thereof is not the responsibility of the applicable utility company,
shall be deemed a part of the Building and the Project for the
purposes of this subparagraph 8(a), except that the amount of the
reimbursement by Tenant to Landlord for such items shall be
separately stated and shall be determined by multiplying the
reasonable and necessary expenses incurred by Landlord for such
items by the percentage which the Premises is of the total space
leased or available for lease which is served by such systems and
equipment or portion thereof instead of by the Tenant's Share of
Operating Expenses as set forth in paragraph 1. Sums payable by
Tenant pursuant to this subparagraph shall be paid in accordance
with the provisions of subparagraph 5(e) above. Landlord may enter
upon the Premises to the extent necessary or appropriate to do any
work described in this subparagraph 8(a), Landlord shall not be
liable for any inconvenience, annoyance, disturbance, loss of
business or other damage of Tenant by reason of performing any such
work or on account of bringing materials, tools, supplies or
equipment into or through the Premises during the course thereof,
and the obligations of Tenant under this Lease shall nor be affected
thereby.
Capital Expenditures will be amortized over the
life of the item. ADA costs will not be included
in Operating Expenses.
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8. operating expenses will not exceed more than a five percent (5%)
increase on controllable expenses. (Excluding property taxes
and insurance) per year. The first year's expenses will be the
actual expenses incurred in 1997.
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(b) TENANT'S MAINTENANCE. Tenant shall, at Tenant's sole cost
and expense, keep and maintain the Premises, subfloors and floor
coverings in good repair and in a clean and safe condition,
casualties covered by insurance coverage excepted to the extent of
proceeds received by Landlord. Tenant's obligations shall include
the cleaning, operation, maintenance, repair and replacement of all
utility systems and related equipment and portions thereof located
within the Premises except to the extent Landlord performs such
cleaning, operation, maintenance, repair and/or replacement under
subparagraph 8(a) above because all or portions of the system and
equipment serve more than one tenant suite. Tenant shall, at
Tenant's own expense, immediately replace all interior, exterior or
other glass in or about the Premises that may be broken during the
Term with glass at least equal to the specification and quality of
the glass so replaced. If Tenant fails to perform Tenant's
obligations under this subparagraph, Landlord may at its option
enter upon the Premises after ten (10) days prior written notice to
Tenant and put the same in good order, condition and repair, and the
cost thereof together with interest thereon at the rate of eighteen
percent (18%) per annum shall become due and payable as additional
rental to Landlord together with Tenant's next monthly Rent payment.
Nothing herein shall imply any duty upon the part of Landlord to do
any such work and the performance thereof by Landlord shall not
constitute a waiver of Tenant's default in failing to perform the
same. Landlord may, during the progress of any such work in or on
the Premises, keep and store therein all necessary materials, tools,
supplies and equipment. Landlord shall not be liable for the
inconvenience, annoyance, disturbance, loss of business or other
damage of Tenant by reason of making such repairs or the performance
of any such work, or on account of bringing materials, tools,
supplies or equipment into or through the Premises during the course
thereof, and the obligations of Tenant under this Lease shall not
be affected thereby.
(c) LANDLORD'S OBLIGATIONS TO REPAIR. Landlord shall, at its
expense, after written notice from Tenant, repair in a prompt and
diligent manner any damage to structural portions of the roof and
bearing walls of the Premises; provided, however, that if such
damage is caused by an act or omission of Tenant or Tenant's agents,
invitees, employees or contractors, then such repairs shall be at
Tenant's expense, payable to Landlord pursuant to this paragraph.
There shall be no abatement of Rent during the performance of such
work. Landlord shall not be liable to Tenant for injury or damage
that may result from any defect in the construction or conditions
of the Premises and Tenant shall seek recovery for such injury or
damage solely from Tenant's insurance and/or any other persons or
entities which may be liable to Tenant. Tenant waives any right to
make repairs at the expense of Landlord under any law, statute or
ordinance now or hereafter in effect unless Tenant has given
Landlord written notice of the need for such repairs, such repairs
are the obligation of Landlord under this Lease and Landlord has
failed to make the needed repairs or started the process of
repairing within ten (10) business days from the receipt of such
notice.
(d) SURRENDER. On the last day of the Term, or on any sooner
termination of this Lease, Tenant shall surrender the Premises to
Landlord in the same condition as when received, broom clean,
ordinary wear and tear alone excepted. Tenant shall repair any
damage to the Premises, the Building and the Project occasioned by
the removal of Tenant's alterations and improvements (including,
without limitation, its trade fixtures, furnishings and equipment),
which repair shall include, without limitation, the patching and
filling of holes and repair of structural damage.
9. UTILITIES. Tenant shall pay for water, gas, heat, light,
power, telephone and other utilities and services supplied to the
Premises, together with any taxes thereon. If any such services are
not separately metered to Tenant, Tenant shall pay a reasonable
proportion to be determined by Landlord of all charges jointly
metered with other premises, and Landlord's determination thereof,
in good faith, shall be conclusive. Landlord reserves the right to
grant easements on the Premises, and to dedicate for public use
portions thereof, without Tenant's
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8.(b) TENANT'S MAINTENANCE. The cost of new HVAC units will be paid for
by the Landlord and passed through to the Tenant over the life of the
item as part of operating expenses.
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consent provided that no such grant or dedication shall interfere with Tenant's
use of the Premises or otherwise cause Tenant to incur cost or expense. From
time to time upon Landlord's demand, Tenant shall execute, acknowledge and
deliver to Landlord, in accordance with Landlord's instructions, any and all
documents or instruments necessary to effect Tenant's covenants herein.
10. ALTERATIONS AND ADDITIONS. (a) LIMITATION. Tenant shall not,
without Landlord's prior written consent, which permission shall not be
unreasonably withheld, make any alterations, improvements, additions, or utility
installations (which term "utility installations" shall include ducting, power
panels, fluorescent fixtures, space heaters, conduits and wiring) in, on or
about the Premises, except for interior nonstructural alterations to the
Premises costing less than Ten Thousand Dollars ($10,000) in the aggregate over
any one (1) year period. As a condition to giving such consent, Landlord may
require that Tenant agree to (i) remove any such alterations, improvements,
additions or utility installations at the expiration of the Term and restore the
Premises to their prior condition or, in the alternative, (ii) require that such
alterations, improvements, additions or utility installations shall become the
property of Landlord and shall be left by Tenant upon the expiration of the
Term. As a further condition to giving such consent, Landlord may require Tenant
to provide Landlord, at Tenant's sole cost and expense, lien and completion
bonds in an amount equal to one hundred five percent (105%) of the estimated
cost of such improvements to insure Landlord against any liability for
mechanics' and materialmen's liens and to insure completion of the work.
(b) LIENS. Tenant shall pay, when due, all claims for labor or
materials furnished or alleged to have been furnished to or for Tenant at or for
use on or in connection with the Premises, which claims are or may be secured by
any mechanics' or materialmens' lien against the Premises or any interest
therein. Tenant shall give Landlord not less than ten (10) days notice prior to
the commencement of any work on the Premises, and Landlord shall have the right
to post notices of non-responsibility in or on the Premises as provided by law.
(c) REMOVAL. Unless Landlord requires their removal as set forth in
subparagraph (a) above or otherwise consents to such removal, all alterations,
improvements, additions and utility installations which may be made on or to the
Premises shall become the property of Landlord and remain upon and be
surrendered with the Premises at the expiration of the Term. Notwithstanding the
provisions of this subparagraph (c), Tenant's machinery and equipment, other
than that which is affixed to the Premises so that it cannot be removed without
material damage to the Premises, shall remain the property of Tenant and may be
removed by Tenant subject to provisions of paragraph 8(d) above.
11. INSURANCE. (a) GENERAL LIABILITY. Tenant at its sole cost and
expense shall maintain commercial general liability insurance ("Liability
Insurance") on an "occurrence basis" against claims for "personal injury,"
including without limitation, bodily injury, death or property damage, occurring
upon, in or about the Premises, the Building and the Property, such insurance to
afford immediate minimum protection, at the time of the inception of this Lease,
and at all times during the Term, to a limit of not less than Two Million
Dollars ($2,000,000) with respect to personal injury or death to any one or
more persons or to damage to property. Such insurance shall designate, and be
for the benefit of, Tenant as the named insured and Landlord as an additional
named insured. Such insurance shall also include coverage against liability
for bodily injury or property damage arising out of the use, by or on behalf of
Tenant, or any other person or organization, of an owned, non-owned, leased or
hired automotive equipment in the conduct of any and all operations called for
under this Lease. The limits of said insurance shall not, however, limit the
liability of Tenant hereunder.
(b) EXTENDED COVERAGE. During the Term, Landlord shall procure and
maintain in full force and effect with respect to the Building, a policy or
policies of fire insurance with extended coverage endorsement attached,
including vandalism and malicious mischief coverage, and any other endorsements
(such as earthquake coverage) which Landlord may elect to obtain or which may be
required by the holder of any fee or leasehold mortgage, which insurance
coverage may be in an amount up to one hundred percent (100%) of the full
insurance replacement value (replacement cost new, including debris removal and
demolition thereof.
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10. ALTERATIONS AND ADDITIONS. A response from the Landlord will be
given to Tenant within ten (10) business days from Tenant's written request.
Landlord will let the Tenant know at the time of approval if the alteration or
addition needs to be removed or restored at the time of such approval. If not
stated at that time then the Tenant will be under no obligation to remove or
restore the alteration or addition.
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Landlord shall further obtain rental abatement insurance against abatement or
loss of Rent in case of fire or other casualty, in an amount at lease equal to
the amount of the Rent payable by Tenant during one (1) year next ensuing as
reasonably determined by Landlord. Tenant shall pay to Landlord, in accordance
with provisions of subparagraph 5(e) above, an amount equal to Tenant's Share
of Insurance Expenses multiplied by the premium or premiums on insurance
maintained by Landlord pursuant to this subparagraph ("Insurance Expenses"),
with appropriate proration at the beginning and end of the Term.
(c) POLICIES. Insurance required hereunder shall be by companies rated
A/X or better in "Best's Insurance Guide" licensed to do business in the state
in which the Premises are located and acceptable to Landlord and the holder of
any mortgage or deed of trust on the Premises or any part or portion thereof.
Tenant shall deliver to Landlord copies of policies of such insurance or
certificates evidencing the existence and amounts of such insurance with loss
payable clauses satisfactory to Landlord. No such policy shall be cancelable or
subject to reduction of coverage or other modification except after thirty (30)
days written notice to Landlord. Tenant shall, within ten (10) days of the
expiration of such policies, furnished Landlord with renewals or "binders"
thereof, or Landlord may order such insurance and charge the cost thereof to
Tenant, which amount shall be payable by Tenant upon demand. Each such policy or
certificate therefor issued by the insurer shall to the extent obtainable
contain (i) a provision that no act or omission of Tenant which would otherwise
result in forfeiture or reduction of the insurance therein provided shall affect
or limit the obligation of the insurance company to pay the amount of any loss
sustained and (ii) an agreement by the insurer that such policy shall not be
cancelled without at least thirty (30) days prior written notice by registered
mail to Landlord. Tenant shall not do or permit to be done anything which shall
invalidate the insurance policies referred to herein. If Tenant shall fail to
produce and maintain any insurance required to be maintained by it by virtue of
any provision of this paragraph, Landlord may, but shall not be required to,
procure and maintain the same, but at the expense of Tenant.
(d) WAIVER OF SUBROGATION. Landlord and Tenant each hereby waive any
and all rights of recovery against the other, or against the partners, officers,
employees, agents and representatives of the other, for loss of or damage to
such waiving party or its property or the property of the other under its
control to the extent that such loss or damage is insured against under any
insurance policy in force at the time of such loss or damage. Tenant shall, upon
obtaining the policies of insurance required hereunder, give notice to the
insurance carrier or carriers that the foregoing mutual waiver of subrogation is
contained in the Lease.
(e) TENANT'S CONTENTS. Tenant shall assume the risk of damage to any
fixtures, goods, inventory, merchandise, equipment, furniture and leasehold
improvements which remain the property of Tenant or as to which Tenant retains
the right of removal from the Premises, and Landlord shall not be liable for
injury to Tenant's business or any loss of income therefrom relative to such
damage. Tenant shall maintain the following insurance coverage with respect to
such items during the Term:
(i) Against fire, extended coverage, and vandalism and
malicious mischief perils in an amount not less than ninety percent
(90%) of the full replacement cost thereof;
(ii) Broad form boiler and machinery insurance on a blanket
repair and replacement basis with limits per accident not less than the
replacement cost of all leasehold improvements and of all boilers,
pressure vessels, air conditioning equipment, miscellaneous electrical
apparatus and all other insurable objects owned or operated by the
Tenant or by others (other than Landlord) on behalf of Tenant in the
Premises, or relating to or serving the Premises; and;
(iii) Business interruption insurance in such an amount as will
reimburse Tenant for direct or indirect loss of earnings attributable
to all such perils insured against in subparagraphs 11(e)(i) and (ii)
hereinabove.
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(f) WORKMEN'S COMPENSATION. Tenant shall, at its own cost and expense,
keep and maintain in full force and effect during the Term, a policy or policies
of workmen's compensation insurance covering all Tenant's employees working in
the Premises, and shall furnish Landlord with certificates thereof.
12. INDEMNITY; EXEMPTION OF LANDLORD FROM LIABILITY. (a) GENERAL. In
addition to any other obligations of Tenant hereunder, including the obligations
of Tenant, to provide insurance, Tenant shall indemnify and hold Landlord
harmless for, from and against any and all claims arising from Tenant's use of
the Premises, or from the conduct of Tenant's business or from any activity,
work or things done, permitted or suffered by Tenant in or about the Premises or
elsewhere and shall further indemnify and hold Landlord harmless for, from and
against any and all claims arising from any breach or default in the performance
of any obligation on Tenant's part to be performed under the terms of this
Lease, or arising from any negligence of Tenant, or any of Tenant's agents,
contractors, or employees, and for, from and against all costs, attorneys' fees,
expenses and liabilities incurred in the defense of any such claim or any action
or proceeding brought thereon; and in case any action or proceeding be brought
against Landlord by reason of any such claim, Tenant upon notice from Landlord
shall defend the same at Tenant's expense by counsel satisfactory to Landlord;
provided, however, the foregoing indemnity shall not apply to claims made as a
result of the gross negligence or intentional misconduct of Landlord. Tenant, as
a material part of the consideration to Landlord for Landlord's execution of
this Lease, also hereby assumes all risk of damage to property or injury to
persons in, upon or about the Premises arising from any cause whatsoever; hereby
waives all claims in respect thereof against Landlord unless caused by
Landlord's gross negligence and agrees that all claims with respect thereto
shall be made solely against any insurance carried by Tenant and/or against any
other persons or entities which may be liable for such claims, unless caused by
Landlords gross
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(b) TENANT'S BUSINESS. In addition to any other obligation of Tenant
hereunder, including any obligation of Tenant to provide insurance, Tenant
hereby agrees that Landlord shall not be liable for injury to Tenant's business
or any loss of income therefrom or for damage to the goods, wares, merchandise
or other property of Tenant, Tenant's employees, invitees, customers, or any
other person in or about the Premises, nor shall Landlord be liable for injury
to the person of Tenant or Tenant's employees, agents or contractors, whether
such damage or injury is caused by or results from fire, steam, electricity,
gas, water or rain, or from the breakage, leakage, obstruction or other defects
of pipes, sprinklers, wires, appliances, plumbing, air conditioning or lighting
fixtures, or from any other cause whatsoever, resulting from conditions arising
upon the Premises, or from other sources or places, and regardless of whether
the cause of such damage or injury or the means of repairing, the same is
inaccessible to Tenant unless caused by Landlord's gross negligence. Instead,
Tenant shall seek recovery for any such injury, loss or damage solely from any
insurance carried by Tenant and/or from any other persons or entities which may
be liable to Tenant for such injury, loss or damage.
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13. DAMAGE OR DESTRUCTION; OBLIGATION TO REBUILD. (a) LANDLORD'S
OBLIGATION TO REBUILD. If the Premises are damaged or destroyed during the Term,
Landlord shall, except as hereinafter provided, diligently repair or rebuild
them to substantially the condition in which they existed immediately prior to
such damage or destruction; provided that any damage which is estimated in good
faith by Landlord to be under Two Thousand Five Hundred Dollars ($2,500.00)
shall be repaired by Tenant, and Landlord shall reimburse Tenant upon demand for
expenses incurred in such repair work to the extent of any proceeds received by
Landlord from extended coverage insurance maintained pursuant to paragraph 11
above.
(b) ABATEMENT OF RENT. Rent due and payable hereunder shall be abated,
but only to the extent of any proceeds received by Landlord from rental
abatement insurance maintained pursuant to paragraph 11 above, during the period
commencing with such damage or destruction and ending with a substantial
completion by Landlord of the work of repair or reconstruction which Landlord is
obligated or undertakes to do.
(c) OPTION TO TERMINATE. If the Building or the Premises are damaged or
destroyed to the extent that Landlord determines that the same cannot, with
reasonable diligence, be fully repaired or restored by Landlord within one
hundred eighty (180) days after the date of the
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12. INDEMNITY: EXEMPTION OF TENANT FROM LIABILITY. (a) GENERAL. In addition to
any other obligations of Landlord hereunder, Landlord shall indemnify and hold
Tenant harmless for, from and against any and all claims arising from
Landlord's use of the Premises, or from the conduct of Landlord's business or
from any activity, work or things done, permitted or suffered by Landlord in or
about the Premises and all claims arising from any breach or default in the
performance of any obligation on Landlord's part to be performed under the
terms of this Lease, unless caused by Tenant's gross negligence.
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damage or destruction, the sole right of both Landlord and Tenant shall be the
option to terminate this Lease as hereinafter provided; provided, however,
Tenant shall not have the right to terminate this Lease unless Landlord
reasonably determines that the Premises cannot be so repaired or restored within
such one hundred eighty (180) day period of time. Landlord shall determine
whether the Building and, if applicable, the Premises can be fully repaired or
restored within the one hundred eighty (180) day period, and Landlord's
determination shall be conclusive on Tenant. Landlord shall notify Tenant of its
determination, in writing, within thirty (30) days after the date of the damage
or destruction. If Landlord determines that the Building, including the
Premises, can be fully repaired or restored within the one hundred eighty (180)
day period, or if it is determined that such repair or restoration cannot be
made within said period but no party having the right to do so elects to
terminate within thirty (30) days from the date of said determination, this
Lease shall remain in full force and effect and Landlord shall diligently repair
and restore the damage as soon as reasonably possible.
(d) UNINSURED CASUALTIES. Notwithstanding anything contained herein to
the contrary, in the event of damage to or destruction of all or any portion of
the Building which is not fully covered (except for deductible amounts) by the
insurance proceeds received by Landlord under the insurance policies required to
be maintained pursuant to paragraph eleven (11) above or in the event that any
portion of such insurance proceeds must be paid over to or are retained by the
holder of any mortgage or deed of trust on the Property or Premises, Landlord
may terminate this Lease by written notice to Tenant, given within thirty (30)
days after the date of notice to Landlord that said damage or destruction is not
so covered or that the proceeds are not available for repair of the damage or
destruction. If Landlord does not elect to terminate this Lease, the Lease shall
remain in full force and effect and the Building shall be repaired and rebuilt
in accordance with the provisions for repair set forth in paragraph 8 above.
(e) TENANT'S WAIVER. With respect to any destruction which Landlord is
obligated to repair or may elect to repair under the terms of this paragraph,
Tenant hereby waives all right to terminate this Lease pursuant to rights
otherwise presently or hereafter accorded by the provisions of Arizona Revised
Statutes Section 33-343 or other applicable laws to tenants, except as expressly
otherwise provided herein.
14. TAXES. (a) TENANT'S SHARE OF PROPERTY TAXES. Tenant shall pay to
Landlord Tenant's Share of Property Taxes (as set forth in paragraph 1 hereof)
multiplied by the sum of the following: all real estate taxes and all other
taxes relating to the Premises, the Building and the Property, all other taxes
which may be levied in lieu of real estate taxes, assessments, and other
governmental charges, or levies, general and special, ordinary and
extraordinary, unforeseen as well as foreseen, of any kind and nature for public
improvements, services or benefits (collectively, "Property Taxes"), which are
assessed, levied, confirmed, imposed or become a lien upon the Premises, the
Building or the Property, or become payable during the Term; provided, however
that:
(i) any Property Taxes shall be prorated between Landlord and
Tenant so that Tenant shall pay only that proportion thereof which the
part of such period within the Term bears to the entire period; and
(ii) any such sum payable by Tenant, which would not otherwise
be due until after the date of the termination of this Lease, shall be
paid by Tenant to Landlord upon such termination.
Any sum payable by Tenant pursuant to this subparagraph for any period during
the Term shall be paid by Tenant in accordance with the provisions of
subparagraph 5(e) above.
(b) TENANT'S PERSONAL PROPERTY. Tenant shall pay prior to delinquency
all taxes assessed against and levied upon trade fixtures, furnishings,
equipment and all other personal property of Tenant contained on the Premises or
elsewhere. Tenant shall cause such trade fixtures, furnishings, equipment and
all other personal property to be assessed and billed separately from the
Premises, the Building and the Property.
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(c) RENT TAX. Tenant shall pay to Landlord a sum equal to the amount
which Landlord is required to pay or collect by reason of any privilege tax,
sales tax, gross proceeds tax, rent tax, or like tax levied, assessed or imposed
by any governmental authority or subdivision thereof, upon or measured by any
Rent, Reimbursable Expense, or other charges or sums required to be paid or
improvements to be made by Tenant under this Lease. Such sum shall be paid
simultaneously with the payment by Tenant to Landlord of the Fixed Rent or other
charge to which such tax is attributable or, in the case of a tax not
attributable to Fixed Rent or other charges, at such time as Landlord shall
demand payment thereof. Nothing contained in this Lease shall require Tenant to
pay any franchise, corporate, estate, inheritance, succession, or transfer tax
of Landlord or any tax upon the net income of Landlord.
15. CONDEMNATION. (a) RENT REDUCTION OR LEASE TERMINATION. If the
Premises or any portion thereof is taken under the power of eminent domain, or
sold under the threat of the exercise of said power (all of which are herein
called "condemnation"), this Lease shall terminate as to the part so taken as of
the date the condemning authority takes title or possession, whichever first
occurs (the "Condemnation Date") and the Rent shall be reduced (as of the
Condemnation Date) as provided below. If (i) more than ten percent (10%) of the
Premises is taken by condemnation and (ii) if the balance of the Premises
remaining after such condemnation is not reasonably suitable for the use to
which the Premises were being put immediately prior to the condemnation,
Landlord or Tenant may, at either's option, to be exercised in writing only
within thirty (30) days after Landlord shall have given Tenant written) notice
of such taking (or in the absence of such notice, within thirty (30) days of the
Condemnation Date) terminate this Lease as of the Condemnation Date. If neither
Landlord nor Tenant terminates this Lease in accordance with the foregoing, or
in the event that that portion of the Premises taken by condemnation is not
sufficiently large so as to give rise to the right to terminate this Lease as
above provided, this Lease shall remain in full force and effect as to the
portion of the Premises remaining, except that the Fixed Rent shall be reduced
(as of the Condemnation Date) in the proportion that the area taken by
condemnation bears to the total area of the Premises.
(b) AWARD. Any award for the taking of all or any part of the Premises
under the power of eminent domain or any payment made under threat of the
exercise of such power shall be the property of Landlord, whether such award
shall be made as compensation for diminution in value of the leasehold or for
the taking of the fee, or as severance damages; provided, however, that Tenant
shall be entitled to any award specifically attributed by the condemning
authority to loss or damage to Tenant's trade fixtures and removable personal
property or to Tenant's relocation costs. In the event that this Lease is not
terminated by reason of such condemnation, Landlord shall, to the extent of
severance damages received by Landlord in connection with such condemnation and
not paid to or retained by the holder of any mortgage or deed of trust on the
Property or the Premises, repair any damage to the Premises caused by such
condemnation except to the extent that Tenant has been reimbursed therefor by
the condemning authority (in which event such reimbursement to Tenant shall also
be applied to such repair).
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16. ASSIGNMENT AND SUBLETTING. (a) CONSENT. Tenant shall not
voluntarily or by operation of law assign, transfer, mortgage, sublet, or
otherwise transfer or encumber all or any part of Tenant's interest in this
Lease or in the Premises without Landlord's prior written consent, which consent
Landlord shall not unreasonably withhold. Landlord may, however, withhold its
consent to such assignment, transfer, mortgage, subletting or other transfer or
encumbrance pursuant to the preceding sentence for substantive reasons
including, without limitation, the financial condition of the proposed assignee
or transferee. Any attempted assignment, transfer, mortgage, subletting or
encumbrance without such consent shall be void and shall constitute a breach of
this Lease. The consent of Landlord to any one assignment, transfer, mortgage,
subletting, or encumbrance shall not be deemed to be a consent to any subsequent
assignment, transfer, mortgage, subletting, or encumbrance. Tenant to provide 30
day notice prior to transfer of more than 50% of the stock or ownership in
tenant, or merger or consolidation along with adequate financial information to
inform Landlord.
(b) TENANTS CONTINUING LIABILITY. Regardless of Landlord's consent, no
subletting or assignment shall alter the primary liability of Tenant to pay the
Rent or release Tenant of Tenant's obligation to perform all other obligations
to be performed by Tenant hereunder unless Landlord's written consent shall so
specifically provide, and Landlord under no circumstances shall be obligated to
release Tenant from any such liability. The acceptance of rent by Landlord from
any other person shall not be deemed to be a waiver by Landlord of any provision
hereof.
(c) INFORMATION. In connection with any proposed assignment or
sublease, Tenant shall submit to Landlord in writing:
(i) The name of the proposed assignee or sublessee;
(ii) Such information as to the financial responsibility and
standing of said assignee or sublessee as Landlord may reasonably
require; and
(iii) All of the terms and conditions upon which the proposed
assignment or subletting is to be made.
(d) EXCESS SUBLEASE RENTAL. If for any sublease or assignment, Tenant
receives rent or other consideration, either directly or indirectly (by
performance of Tenant's obligations or otherwise) and either initially or over
the Term of the sublease or assignment, in excess of the Fixed Rent, Adjustments
and additional rent called for hereunder, or in the case of the sublease or
assignment of a portion of the Premises, in excess of such Fixed Rent,
Adjustments and additional rent fairly allocable to such portion, after
appropriate adjustments to assure that all other payments called for hereunder
are appropriately taken into account, Tenant shall pay to Landlord, at the same
time as Fixed Rent is due hereunder, one-half (1/2) of the excess of each such
payment of rent or other consideration received by Tenant promptly after its
receipt.
(e) RELEASE. Whenever Landlord conveys its interest in the Premises,
Landlord shall be automatically released from the further performance of
covenants on the part of Landlord herein contained, and from any and all further
liability, obligations, costs and expenses, demands, causes of action, claims or
judgments arising from or growing out of, or connected with this Lease after the
effective date of said release. The effective date of said release shall be the
date the assignee executes an assumption of such an assignment whereby the
assignee expressly agrees to assume all of Landlord's obligations, duties,
responsibilities and liabilities with respect to this Lease. If requested,
Tenant shall execute a form of release and such other documentation as may be
required to effect the provisions of this paragraph.
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If Tenant subleases, assigns or conveys their interest in the Lease, and the new
entity gives the Landlord a security deposit, then Landlord will return the
security deposit to Tenant minus monies owed or damages to the suite.
If building changes ownership and current Landlord shall either refund the
Tenant's security deposit to Tenant or transfer security deposit to new owner as
part of escrow.
16. ASSIGNMENT AND SUBLETTING. (a) CONSENT. A response from Landlord will be
within fifteen (15) days from Tenant's written request.
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(f) CONTROLLED ENTITY. Notwithstanding the provisions of this paragraph
16, Tenant may assign or sublet the Premises, or any portion thereof, without
Landlord's consent, after written notice to Landlord, to any entity which
controls, is controlled by, or is under common ownership with Tenant, or to any
entity resulting from the merger or consolidation with Tenant, or to any person
or entity which acquires all the assets of Tenant as a going concern of the
business that is being conducted on the Premises, provided that said assignee
assumes, in full, the obligations of Tenant under this Lease. Any such
assignment shall not, in any way, affect or limit the liability of Tenant under
the terms of this Lease even if after such assignment or subletting the terms of
this Lease are materially changed or altered without the consent of Tenant, the
consent of whom shall not be necessary for such change or alteration.
(g) ATTORNEYS' FEES. In the event that Landlord shall consent to a
sublease or assignment under subparagraph (a) above, Tenant shall pay Landlord's
reasonable attorneys' fees incurred in connection with the giving of such
consent and review of the information submitted by Tenant.
17. DEFAULTS; REMEDIES. (a) DEFAULTS. The occurrence of any one or more
of the following events shall constitute a material default and material breach
of this Lease by Tenant:
(ii) The failure by Tenant to make any payment of Rent or any other
payment required to be made by Tenant hereunder, as and when due, where such
failure shall continue for a period of ten (10) days after written notice
thereof from Landlord to Tenant;
(iii) The failure by Tenant to observe or perform any of the covenants,
conditions or provisions of this Lease to be observed or performed by Tenant,
other than those described in subparagraph (ii) above, where such failure shall
continue for a period of ten (10) days after written notice thereof from
Landlord to Tenant; provided, however, that if the nature of Tenant's default is
such that it is capable of being cured but more than ten (10) days are
reasonably required for its cure, then Tenant shall not be deemed to be in
default if Tenant commences such cure within such ten (10) day period and
thereafter diligently prosecutes such cure to completion; or
(iv) The making by Tenant of any general assignment for the benefit of
creditors, the filing by or against Tenant of a petition for order of relief in
bankruptcy for the purpose of bankruptcy liquidation or reorganization under any
law relating to bankruptcy whether now existing or hereafter enacted (including,
without limitation, any petition filed by or against Tenant under any one or
more of the following Chapters of the Bankruptcy Reform Act of 1978, 11 U.S.C.
Sections 101-1330 ("Bankruptcy Code") as amended: Chapter 7 or Chapter 9 or
Chapter 11 or Chapter 12 or Chapter 13) except that, in the case of a filing
against Tenant of such a petition, such filing shall not be a default if the
petition is dismissed or discharged on or before sixty (60) days after the
filing thereof; the appointment of a trustee or receiver to take possession of
all or substantially all of Tenant's assets located at the Premises or of
Tenant's interest in this Lease, where possession is not restored to Tenant
within sixty (60) days; or the attachment, execution or other judicial seizure
of substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where such seizure is not discharged within sixty (60)
days. Unless Landlord's express written consent thereto is first obtained, in
no event shall this Lease, or any interest herein or hereunder or any estate
created hereby, be assigned or assignable by operation of law or by, in or under
voluntary or involuntary bankruptcy liquidation or reorganization proceedings
or otherwise and in no event shall this Lease or any rights or privileges
hereunder be an asset of Tenant under any bankruptcy liquidation or
reorganization proceedings. Any purported assignment or transfer in violation of
the provisions of this subparagraph (iv) shall constitute a material default and
breach of this Lease by Tenant and in connection with any such default and
breach Landlord shall have the rights and remedies described in subparagraph (b)
below, including, without limitation, the election to terminate this
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Lease. As used in this subparagraph (iv) the words "bankruptcy
liquidation or reorganization proceedings" shall include any
proceedings under any law relating to bankruptcy whether now existing
or hereafter enacted (including, without limitation, proceedings under
any one or more of the Bankruptcy Code as amended: Chapter 7 or Chapter
9 or Chapter 11 or Chapter 12 or Chapter 13).
(b) REMEDIES.
(i) In the event of any default and breach by Tenant of any of
its obligations under this Lease then this Lease shall continue in
effect so long as Landlord does not expressly terminate Tenant's right
to possession in any of the manners specified in this paragraph and
Landlord may, at Landlord's option and without limiting Landlord in the
exercise of any other rights or remedies which it may have by reason of
such default and breach, exercise all of its rights and remedies
hereunder, including, without limitation:
(A) The right to declare the Term ended and to
reenter the Premises and take possession thereof and remove
all persons therefrom, and Tenant shall have no further claim
in or to the Premises or under this Lease; or
(B) The right without declaring this Lease ended to
reenter the Premises, take possession thereof, remove all
persons therefrom and occupy or lease the whole or any part
thereof for and on account of Tenant and upon such terms and
conditions and for such rent as Landlord may deem proper and
to collect such rent or any other rent that may hereafter
become payable and apply the same as provided in subparagraph
(ii) below; or
(C) The right, even though Landlord may have relet
the Premises or brought an action to collect Rent and other
charges without terminating this Lease, to thereafter elect to
terminate this Lease and all of the rights of Tenant in or to
the Premises; or
(D) The right, without terminating this Lease, to
bring an action or actions to collect Rent and other charges
hereunder which are from time to time past due and unpaid or
to enforce any other provisions of this Lease imposing
obligations on Tenant, it being understood that the bringing
of any such action or actions shall not terminate this Lease
unless written notice of termination is given.
(ii) Should Landlord relet the Premises under the provisions
of subparagraph (b)(i)(B) above, Landlord may execute any lease either
in its own name or in the name of Tenant, but Tenant hereunder shall
have no right or authority whatever to collect any rent from the new
tenant. The proceeds of any such reletting shall first be applied to
the payment of the costs and expenses of reletting the Premises,
including without limitation, reasonable brokerage commissions and
alterations and repairs which Landlord, in its sole discretion, deems
reasonably necessary and advisable and to the payment of reasonable
attorneys' fees incurred by Landlord in connection with the Tenant's
default, the retaking of the Premises and such reletting and, second,
to the payment of any indebtedness, other than Rent, due hereunder,
including, without limitation, storage charges owing from Tenant to
Landlord. When such costs and expenses of reletting have been paid, and
if there is no such indebtedness or such indebtedness has been paid,
Tenant shall be entitled to a credit for the net amount of rental
received from such reletting each month during the unexpired balance of
the Term, and Tenant shall pay Landlord monthly on the first day of
each month as specified herein such sums as may be required to make up
the rentals provided for in this Lease. Nothing contained herein shall
be construed as obligating Landlord to relet the whole or any part of
the Premises.
(iii) Should Landlord elect to terminate this Lease under the
provisions of subparagraphs (b)(i)(A) or (C) above, Landlord shall be
entitled to recover immediately
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17.(b)(ii) If Landlord extends the lease term of the new Tenant past
the current Tenant's expiration, then the re-lease costs will be
prorated according to the existing and new lease terms.
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from Tenant (in addition to any other amounts recoverable by Landlord
as provided by law), the following amounts:
(A) The worth at the time of award of the unpaid rent
which had been earned at the time of termination;
(B) The worth at the time of award of the amount by
which the unpaid rent which would have been earned after
termination until the time of award exceeds the amount of such
rental loss that Tenant proves could have been reasonably
avoided;
(C) The worth at the time of award of the amount by
which the unpaid rent for the balance of the Term after the
time of award exceeds the amount of fair rental value that
Tenant proves could be reasonably avoided; and
(D) Any other amount necessary to compensate Landlord
for all the detriment proximately caused by Tenant's failure
to perform its obligations under the Lease or which in the
ordinary course of things would be likely to result therefrom.
For purposes of computing "the worth at the time of the award" of the
amount specified in subparagraph (b)(iii)(C) above, such amount shall
be discounted at the discount rate of the Federal Reserve Bank of San
Francisco at the time of award. For purposes of computing "the worth at
the time of the award" under subparagraphs (b)(iii)(A) and (b)(iii)(B)
above, an interest rate of ten percent (10%) per annum shall be
utilized.
(iv) If Landlord shall elect to reenter the Premises as
provided above, Landlord shall not be liable for damages by reason of
any reentry, unless caused by Landlord's gross negligence Tenant hereby
waives all claims and demands against Landlord for damages or loss
arising out of or in connection with any reentering and taking
possession of the Premises and waives all claims for damages or loss
arising out of or in connection with any destruction of or damage to
the Premises, or for any loss of property belonging to Tenant or to any
other person, firm or corporation which may be in or upon the Premises
at the time of such reentry.
(v) Landlord shall not be deemed to have terminated this
Lease, Tenant's right to possession of the Premises or the liability of
Tenant to pay Rent thereafter to accrue or its liability for damages
under any of the provisions hereof by any reentry hereunder or by any
action in unlawful detainer or otherwise to obtain possession of the
Premises, unless Landlord shall notify Tenant in writing that Landlord
has so elected to terminate this Lease. Tenant agrees that the service
by Landlord of any notice pursuant to the unlawful detainer statutes or
comparable statutes of the state or locality in which the Premises are
located and the surrender of possession pursuant to such notice shall
not (unless Landlord elects to the contrary at the time of or at any
time subsequent to the service of such notice and such election shall
be evidenced by a written notice to Tenant) be deemed to be a
termination of this Lease or of Tenant's obligations hereunder. No
reentry or reletting under this paragraph shall be deemed to constitute
a surrender or termination of this Lease, or of any of the rights,
options, elections, powers and remedies reserved by Landlord hereunder,
or a release of Tenant from any of its obligations hereunder, unless
Landlord shall specifically notify Tenant, in writing, to that effect.
No such reletting shall preclude Landlord from thereafter at any time
terminating this Lease as herein provided.
(vi) All fixtures, furnishings, goods, equipment, chattels or
other personal property of Tenant remaining on the Premises at the time
that Landlord takes possession thereof may at Landlord's election be
stored at Tenant's expense or sold or otherwise disposed of by Landlord
in any manner permitted by applicable law, up to the amount owed to
Landlord by Tenant.
(vii) All rights, options, elections, powers and remedies of
Landlord under the provisions of this Lease are cumulative of each
other and of every other right, option,
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election, power or remedy which Landlord may otherwise have at law or
in equity and all or any of which Landlord is hereby authorized to
exercise. The exercise of one or more rights, options, elections,
powers or remedies shall not prejudice or impair the concurrent or
subsequent exercise of other rights or remedies Landlord may have upon
a breach and default under this Lease and shall not be deemed to be a
waiver of Landlord's rights or remedies thereupon or to be a release of
Tenant from Tenant's obligations thereon unless such waiver or release
is expressed in writing and signed by Landlord.
(c) LATE CHARGES. Tenant hereby acknowledges that late payment by
Tenant to Landlord of Rent and other sums due hereunder will cause Landlord to
incur costs not contemplated by this Lease, the exact amount of which will be
extremely difficult to ascertain. Such costs include, but are not limited to,
processing and accounting charges, and late charges which may be imposed on
Landlord by the terms of any mortgage or trust deed covering the Premises.
Accordingly, if any installment of rent or any other sum due from Tenant shall
not be received by Landlord or Landlord's designee within ten (10) days after
such amount shall be due, Tenant shall pay to Landlord a late charge equal to
ten percent (10%) of such overdue amount. The parties hereby agree that such
late charge represents a fair and reasonable estimate of the costs Landlord will
incur by reason of late payment by Tenant. Acceptance of such late charge by
Landlord shall in no event constitute a waiver of Tenant's default with respect
to such overdue amount, nor prevent Landlord from exercising any of the other
rights and remedies granted hereunder.
(d) PAYMENT OR PERFORMANCE BY LANDLORD. Landlord may, at Landlord's
option and without any obligation to do so, pay any sum or do any act which
Tenant has failed to pay or do at the time Tenant was obligated to make such
payment or perform such act and Landlord shall be entitled to recover from
Tenant, upon demand, all sums expended by Landlord in making such payment or
performing such act, together with interest thereon at the rate provided in
subparagraph 18(d) from the date of expenditure until repaid by Tenant. Such sum
and interest shall be deemed additional rent under this Lease.
18. MISCELLANEOUS. (a) ESTOPPEL CERTIFICATE.
(i) Tenant shall at any time upon not less than ten (10)
business days prior written notice from Landlord execute, acknowledge,
and deliver to Landlord a statement in writing certifying that this
Lease is unmodified and in full force and effect (or, if modified,
stating the nature of such modification and certifying that this Lease,
as so modified, is in full force and effect) and the date to which the
Rent and other charges are paid in advance, if any, and acknowledging
that there are not, to Tenant's knowledge, any uncured defaults on the
part of Landlord hereunder, or specifying such defaults if any are
claimed. Any such statement may be conclusively relied upon by any
person to whom it shall be delivered by Landlord including any
prospective purchaser or encumbrancer of the Premises, the Building,
the Property, or any part thereof.
(ii) Tenant's failure to deliver such statement within such
time shall be conclusive upon Tenant that this Lease is in full force
and effect, without modification except as may be represented by
Landlord; that there are no uncured defaults in Landlord's performance;
and that not more than one month's Rent has been paid in advance.
(iii) If Landlord desires to finance or refinance the
Premises, the Building, the Property, or any part thereof, Tenant
hereby agrees to deliver to any lender designated by Landlord such
financial statements of Tenant as may be reasonably required by such
lender. Such statements shall include the past one or more years
financial statements of Tenant.
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All such financial statements shall be received by Landlord in
confidence and shall be used only for the purposes herein set forth.
(b) LANDLORD'S LIABILITY. The term "Landlord" as used. herein shall
mean only the owner or owners at the time in question of the fee title (or the
lessee's interest in any ground or master lease) to the Premises and in the
event of any transfer of such title, Landlord herein named (and in case of any
subsequent transfers, the then grantor) shall be relieved from and after the
date of such transfer of all liability as respects Landlord's obligations
thereafter to be performed, provided that any funds in the hands of Landlord or
the then grantor at the time of such transfer in which Tenant has an interest
shall be delivered to the grantee, The obligations contained in this Lease to be
performed by Landlord shall, subject as aforesaid, be binding on Landlord's
successors and assigns only during their respective periods of ownership.
(c) CONSTRUCTION. Paragraph captions are solely for the convenience of
the parties and shall not be deemed to or be used to define, construe, or limit
the terms hereof. As used in this Lease, the masculine, feminine and neuter
genders shall be deemed to include the others, and the singular number shall be
deemed to include the plural, whenever the context so requires. The invalidity
of any provisions of this Lease as determined by a court of competent
jurisdiction shall in no way affect the validity of any other provision hereof.
This Lease shall be governed by the laws of the state in which the Premises are
located.
(d) INTEREST ON PAST-DUE OBLIGATIONS. Except as expressly herein
provided, any amount due to Landlord not paid when due shall bear interest at
the lesser of (i) eighteen percent (18%) per annum or (ii) the maximum rate
permitted by law, from the date due until the date such amount is paid. Payment
of such interest shall be made when such amount is paid. Payment of such
interest shall not excuse or cure any default by Tenant under this Lease.
(e) TIME OF ESSENCE. Time is of the essence of this Lease and all of
the covenants and obligations hereof.
(f) COUNTERPARTS. This Lease may be executed in two or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same Lease.
(g) INCORPORATION OF PRIOR AGREEMENTS; AMENDMENTS. This Lease contains
all agreements of the parties with respect to any matter mentioned herein. No
prior agreement or understanding pertaining to any such matter shall be
effective. This Lease may be modified in writing only, which writing shall be
signed by the parties in interest at the time of the modification.
(h) NOTICES. Any notices, approvals, agreements, certificates, other
documents or communications between the parties hereto required or permitted
under this Lease shall be in writing. Any such communications shall be deemed to
have been duly given or served if delivered in hand or forty-eight (48) hours
after deposit in the United States mail, certified or registered, postage and
fees prepaid, return receipt requested, addressed to the parties at the
addresses set forth in paragraph 1 of this Lease. The address to which any such
communications shall be sent may be changed by either party hereto from time to
time by a notice mailed as aforesaid.
(i) WAIVERS. No waiver by Landlord of any provision hereof shall be
deemed a waiver of any other provision hereof or of any subsequent breach by
Tenant of the same or any other provision. Landlord's consent to or approval of
any act shall not be deemed to render unnecessary the obtaining of Landlord's
consent to or approval of any subsequent act by Tenant. The acceptance of Rent
hereunder by Landlord shall not be a waiver of any preceding breach by Tenant of
any provision hereof, other than the failure of Tenant to pay the particular
Rent so accepted, regardless of Landlord's knowledge of such preceding breach at
the time of acceptance of such Rent.
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(j) RECORDING. Tenant shall not record this Lease without Landlord's
prior written consent and such recordation shall, at the option of Landlord,
constitute a noncurable default of Tenant hereunder. Landlord and Tenant shall,
upon the request of either party, execute, acknowledge and deliver to the other
a "short form" memorandum of this Lease for recording purposes.
(k) HOLDING OVER. If Tenant remains in possession of the Premises or
any part thereof after the expiration of the Term or sooner termination of this
Lease with the express written consent of Landlord and without executing a new
lease, such occupancy shall be construed as a tenancy from month-to-month at a
rental equal to one hundred twenty-five percent (125%) of the last monthly Rent
plus all other charges payable hereunder, and upon all the terms hereof insofar
as the same are applicable to a month-to-month tenancy. Nothing contained in
this subparagraph shall be construed to grant Tenant the right to holdover
without the express written consent of Landlord.
(l) COVENANTS AND CONDITIONS. Each provision of this Lease performable
by Tenant shall be deemed both a covenant and a condition.
(m) BINDING EFFECT. Subject to any provisions hereof restricting
assignment or subletting by Tenant and subject to the provision of subparagraph
(b) above, this Lease shall bind the parties and their personal representatives,
successors and assigns.
(n) SUBORDINATION.
(i) This Lease, at Landlord's option, shall be subordinate to
any ground lease, mortgage, deed of trust, or any other hypothecation
for security now or hereafter placed upon the Premises, the Building
or the Property, or any part or parts thereof, and to any and all
advances made on the security thereof and to all renewals,
modifications, consolidations, replacements and extensions thereof. If
any present or future mortgagee, trustee or ground lessor shall at any
time elect to have this Lease prior to the lien of its mortgage, deed
of trust or ground lease, and written notice of such election shall be
given to Tenant, this Lease shall be deemed prior to such mortgage,
deed of trust, or ground lease, whether this Lease is dated prior or
subsequent to the date of said mortgage, deed of trust or ground lease
or the date of recording thereof.
(ii) Tenant agrees to execute any documents required to
effectuate such subordination or to make this Lease prior to the lien
of any mortgage, deed of trust or ground lease, as the case may be, and
failing to do so within ten (10) business days after written demand,
does hereby make, constitute and irrevocably appoint Landlord as
Tenant's attorney in fact and in Tenant's name, place and stead, to do
so.
(o) ATTORNEYS' FEE. If either party brings an action to enforce the
terms hereof or declare rights under this Lease, the prevailing party in the
final adjudication of any such action, on trial or appeal, shall be entitled to
its costs and expenses of suit, including, without limitation, its actual
attorneys' fees, to be paid by the losing party as fixed by the court.
(p) LANDLORD'S ACCESS. Landlord and Landlord's agents shall have the
right to enter the Premises at reasonable times for the purpose of inspecting
the same, showing the same to prospective purchasers or lenders, and making such
alterations, repairs, improvements or additions to the Premises or the
improvements as Landlord may deem necessary or desirable. Landlord may at any
time place on or about the Premises any ordinary "For Sale" signs and Landlord
may at any time during the last one hundred twenty (120) days of the Term place
on or about the Premises any ordinary "For Lease" signs, all without rebate of
rent or liability to Tenant.
(q) AUCTIONS. Tenant shall not conduct any auction on the Premises
without Landlord's prior written consent.
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(r) MERGER. The voluntary or other surrender of this Lease by Tenant,
or a mutual cancellation thereof, shall not work a merger, and shall, at the
option of Landlord, terminate all or any existing subtenancies or may, at the
option of Landlord, operate as an assignment to Landlord of any or all of such
subtenancies. During any period while Tenant is in default under this Lease,
Landlord, in addition to any other rights and remedies it may have under this
Lease, shall have the right to collect directly from any subtenant all rentals
owing to Tenant under any subtenancy and to apply such rentals to any amounts
owing to Landlord by Tenant and the payment of such amounts by the subtenant
directly to Landlord shall not be a default under the subtenancy.
(s) JOINT AND SEVERAL LIABILITY. Each party signing this Lease as
Tenant shall be jointly and severally liable for the failure on the part of
Tenant to pay any sums due under the terms of this Lease or for the breach by
Tenant or any of the covenants or obligations of Tenant contained herein.
(t) INDIVIDUAL LIABILITY. The obligations of Landlord or Tenant under
this Lease do not constitute personal obligations of the individual partners,
directors, officers, or shareholders of Landlord or Tenant and Landlord or
Tenant shall look solely to the real estate that is the subject of this Lease
and to no other assets of Landlord or Tenant for satisfaction of any liability
in respect of this Lease and will not seek recourse against the individual
partners, directors, officers or shareholders of Landlord or any of their
personal assets for such satisfaction.
(u) ATTORNMENT. Tenant shall, in the event any proceedings are brought
for the foreclosure of, or in the event of exercise of the power of sale under
any mortgage or deed of trust made by the Landlord, its successors or assigns,
encumbering the Premises, or any part thereof, or in the event of termination of
the ground lease, if any, and if so requested, attorn to the purchaser upon such
foreclosure or sale or upon any grant of a deed in lieu of foreclosure and shall
recognize such purchaser as the Landlord under this Lease. If such purchaser
honors lease and assumes liability for the security deposit.
(v) LENDERS RIGHT TO CURE. Tenant agrees to give the holder of any
mortgage or trust deed encumbering the Premises, by registered mail, a copy of
any notice of default or nonperformance served upon Landlord, provided that
prior to such notice, Tenant has been notified in writing (by way of Assignment
of Rents and Leases or otherwise) of the address of such mortgagee or trust deed
holder. Tenant further agrees that Landlord shall not be in default under this
Lease unless (i) Tenant has given a written notice to Landlord stating that
Landlord has failed to perform Landlord's obligations under this Lease and (ii)
specifying with particularity the obligations which Landlord has failed to
perform, and Landlord thereafter fails to perform any of its obligations so
specified within a reasonable time after Landlord's receipt of such notice. If
Landlord shall fail to cure such nonperformance in a timely manner, then such
mortgagee or trust deed holder shall have an additional thirty (30) days within
which to cure the default, or, if such default cannot be cured within that time,
then such additional time as may be necessary if within such thirty (30) days
such mortgagee or trust deed holder has commenced and is diligently pursuing the
remedies necessary to cure such default (including but not limited to
commencement of foreclosure proceedings, if necessary to effect such cure), in
which event this Lease shall not be terminated by Tenant while such remedies arc
being so diligently pursued.
(w) REVISIONS TO LEASE. Tenant hereby agrees to make any reasonable
revisions to this Lease which may be required in good faith by a bona fide
construction, interim or permanent lender in connection with the financing of
the Premises. Tenant agrees as long as the changes do not change the terms and
conditions of the Lease.
(x) ADMINISTRATIVE CHARGE. In addition to Fixed Rent, Adjustments and
other charges hereunder, Tenant shall pay to Landlord an overall administrative
charge of five percent (5%) of any charge which is Tenant's responsibility to
pay, which Landlord pays on behalf of Tenant and for which Landlord subsequently
bills Tenant.
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19. TOXIC MATERIALS. (a) DEFINITIONS.
(i) As used in this Lease, the term "Hazardous Material[s]"
means any oil, flammable items, explosives, radioactive materials,
hazardous or toxic substances, material or waste or related materials
including, without limitation, any substances that pose a hazard to the
Premises or to persons on or about the Premises and any substances
defined as or included in the definition of "hazardous substance,"
"hazardous waste," "hazardous material," "toxic substance," "extremely
hazardous waste," "restricted hazardous waste" or words of similar
import, now or subsequently regulated in any way under applicable
federal, state or local laws or regulations, including without
limitation, petroleum-based products, paints, solvents, lead, cyanide,
DDT, printing inks, acids, pesticides, ammonia compounds and other
chemical products, asbestos, PCBs, urea formaldehyde foam insulation,
transformers or other equipment containing dielectric fluid, levels of
polychlorinated biphenyls, or radon gas, and similar compounds, and
including any different products and materials which are subsequently
found to have adverse effects on the environment or the health and
safety of persons.
(ii) As used herein, the term "Environmental Law[s]" means any
one or all of the following: the Comprehensive Environmental Response,
Compensation and Liability Act, as amended by the Superfund Amendments
and Reauthorization Act of 1986 (42 U.S.C. Sections 9601 et seq.); the
Resource Conservation and Recovery Act as amended (42 U.S.C. Sections
6901 et seq.); the Safe Drinking Water Act as amended (42 U.S.C.
Sections 300f et seq.); the Clean Water Act as amended (33 U.S.C.
Sections 1251 et seq.); the Clean Air Act as amended (42 U.S.C.
Sections 7401 et seq.); the Toxic Substances Control Act as amended (15
U.S.C. Sections 136 et seq.); the Solid Waste Disposal Act as amended
(42 U.S.C. Sections 3251 et seq.); the Hazardous Materials
Transportation Act (49 U.S.C. Sections 1801 et seq.); the regulations
promulgated under any of the foregoing; and all other laws,
regulations, ordinances, standards, policies, and guidelines now in
effect or hereinafter enacted by any governmental entity (whether
local, state or federal) having jurisdiction or regulatory authority
over the Premises or the Project or over activities conducted therein
and which deal with the regulation or protection of human health,
industrial hygiene or the environment, including the soil, subsurface
soil, ambient air, groundwater, surface water, and land use.
(iii) As used herein, the term "Environmental Activity{ies]"
means any generation, manufacture, production, pumping, bringing upon,
use, storage, treatment, release, discharge, escaping, emitting,
leaching, disposal or transportation of Hazardous Materials.
(b) PROHIBITION ON HAZARDOUS MATERIALS. Except as specifically provided
in subparagraph (c) below, Tenant shall not cause or permit any Environmental
Activities in, on or about the Premises by Tenant or Tenant's agents, employees,
contractors, assignees, sublessees or invitees (hereinafter cumulatively
referred to as "Tenant's Agents") without the prior written consent of Landlord.
Landlord shall be entitled to take into account such factors or facts as
Landlord may reasonably determine to be relevant in determining whether to
consent
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to Tenant's proposed Environmental Activity and Landlord may attach conditions
to any such consent if such conditions are reasonably necessary to protect
Landlord's interests in avoiding potential liability upon Landlord or damage to
Landlord's property arising from any Environmental Activity by Tenant or
Tenant's Agents. In no event shall Landlord be required to consent to the
installation or use of any storage tanks on the Property.
(c) EXCEPTION TO PROHIBITION. Notwithstanding the prohibition set forth
in subparagraph (b) above, but subject to Tenant's covenant to comply with all
Environmental Laws and with the other provisions of this paragraph 19, Tenant
may bring upon, keep and use in the Premises (but not outside the Premises) (i)
general office supplies typically used in an office or warehouse in the ordinary
course of business, such as copier toner, liquid paper, glue, ink and janitorial
supplies, so long as such supplies are used in the manner for which they were
designed and in such amounts as may be normal for the business operations
conducted by Tenant in the Premises, and (ii) those Hazardous Materials, if any,
described on Exhibit D attached hereto and by this reference made a part hereof
so long as Tenant has delivered to Landlord a description of the handling,
storage, use and disposal procedures to be utilized by Tenant with respect
thereto.
(d) COMPLIANCE WITH ENVIRONMENTAL LAWS. Tenant shall keep and maintain
the Premises in compliance with, and shall not cause or permit the Premises to
be in violation of, any Environmental Laws. All Tenant's activities at the
Premises shall be in accordance with all Environmental Laws. Additionally,
Tenant shall obtain any and all necessary permits for Tenant's activities at the
Premises. Tenant's obligations and liabilities under this paragraph 19 shall
continue so long as Landlord bears any liability or responsibility under the
Environmental Laws for any action that occurs on the Premises during the term of
this Lease.
(e) ENVIRONMENTAL NOTICES. Tenant shall immediately notify Landlord of,
and upon Landlord's request shall provide Landlord with copies of, the
following:
(i) Any correspondence, communication or notice, oral or
written, to or from any governmental entity regarding the application
of Environmental Laws to the Premises or Tenant's operations on the
Premises including, without limitation, notices of violation, notices
to comply and citations;
(ii) Any reports filed pursuant to any Environmental Law or
self-reporting requirements;
(iii) Any permits and permit applications; and
(iv) Any change in Tenant's operations on the Premises that
will change or has the potential to change Tenant's or Landlord's
obligations or liabilities under Environmental Laws.
Tenant shall also notify the Landlord of the release of any Hazardous Material
in, on, under, about or above the Premises, the Building, the Property or the
Project.
(f) ENVIRONMENTAL INDEMNITY. Tenant shall protect, indemnify, defend
(with counsel satisfactory to Landlord) and hold harmless Landlord and its
directors, officers, partners, employees, agents, lenders, and ground lessees,
if any, and their respective successors and assigns for, from and against any
and all losses, damages, claims, costs, expenses, penalties, fines and
liabilities of any kind (including, without limitation, the cost of any
investigation, remediation and cleanup, and attorneys' fees) which, in
Landlord's reasonable opinion after reviewing an environment report are
attributable to (i) any Environmental Activity on the Property or Project or in
the Building or Premises undertaken or committed by Tenant or Tenant's Agents or
caused by the negligence of such persons during the Term of this Lease, (ii) any
remedial or clean-up work undertaken by or for Tenant in connection with
Tenant's Environmental Activities or Tenant's compliance with Environmental
Laws, or (iii) the breach by Tenant of any of its obligations and covenants set
forth in this paragraph 19. Landlord shall have the right but not the obligation
to join and participate in, and control, if it so elects, any legal proceedings
initiated in connection with the
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Environmental Activities of Tenant or Tenant's Agents. Landlord may also
negotiate, defend, approve and appeal any action taken or issued by any
applicable governmental authority with regard to contamination of the Premises
or any portion of the Property or Project by a Hazardous Material. Any costs or
expenses incurred by Landlord for which Tenant is responsible under this
paragraph 19 or for which Tenant has indemnified Landlord shall be reimbursed by
Tenant on demand, as additional rent and with interest thereon, as provided by
subparagraph 17(d) of this Lease. This indemnity shall survive the termination
of this Lease.
(g) REMEDIAL WORK. If (i) any Environmental Activity undertaken by
Tenant or Tenant's Agents results in contamination of the Premises, Building,
Property or Project or any portion thereof, or the soil or groundwater
thereunder, or (ii) any investigation, site monitoring, containment, cleanup,
removal, restoration or other remedial work of any kind or nature ("Remedial
Work") is necessary or appropriate due to or in connection with Tenant's use or
occupancy of the Premises, then, subject to Landlord's prior written approval
and any conditions imposed by Landlord, Tenant shall promptly perform all
Remedial Work, at Tenant's sole expense and without abatement of rent, as is
necessary to return the affected portion of the Premises, Building, Property
and/or Project and the soil and groundwater to the condition existing prior to
the introduction of the contaminating Hazardous Material and to otherwise comply
with all applicable Environmental Laws. Landlord's approval of such Remedial
Work shall not be unreasonably withheld so long as such actions will not cause a
material adverse effect on the Premises, Building, Property or Project after
expiration of the Lease Term or any material adverse effect on the Premises,
Building, Property or Project. Landlord shall also have the right to approve any
and all contractors hired by Tenant to perform such Remedial Work. All such
Remedial Work shall be performed in compliance with all applicable laws,
ordinances and regulations and in such a manner as to minimize any interference
with the use and enjoyment of the Premises, Building, Property and Project. All
costs and expenses of such Remedial Work shall be paid by Tenant including,
without limitation, the charges of such contractor(s), and the reasonable fees
and costs of the attorneys and consultants for Landlord incurred in connection
with monitoring or review of such Remedial Work.
(h) LANDLORD'S OPTION. Landlord may elect, at Landlord's sole
discretion, to perform any Remedial Work. Landlord and Landlord's agents shall
have the right to enter the Premises at all reasonable times to inspect, monitor
and/or perform Remedial Work. All expenses incurred by Landlord in connection
with performing Remedial Work are payable by Tenant, upon Landlord's demand,
with interest thereon, as provided by subparagraph 17(d).
(i) INJUNCTIVE RELIEF. Tenant's failure to abide by the terms of this
paragraph 19 shall be restrainable by injunction.
(j) SELF-HELP. Landlord and/or Tenant shall have the right of
"self-help" or similar remedy in order to minimize any damages, expenses,
penalties and related fees or costs arising from or related to a violation of
any Environmental Law with respect to the Premises or the Project.
(k) OTHER TENANTS. Other tenants of the Project may be using, handling
or storing certain Hazardous Materials in connection with such tenants' use of
their premises. The failure of another tenant to comply with applicable laws and
procedures could result in a release of Hazardous Materials and contamination to
improvements within the Project or the soil and groundwater thereunder. In the
event of such a release, the tenant responsible for the release, and not
Landlord, shall be responsible for any claim, damage or expense incurred by
Tenant by reason of such contamination and Tenant shall exhaust all its
remedies against such other tenant without any right to seek any recovery
against Landlord. Unless caused by Landlord's gross negligence.
(l) ENVIRONMENTAL INSPECTION. Tenant shall, if reasonably required by
Landlord on account of the activities or suspected activities of Tenant or
Tenant's Agents, retain a recognized environmental consultant (the "Consultant")
acceptable to Landlord to conduct an investigation of the Premises and of other
portions of the Project deemed appropriate by Landlord ("Environmental
Assessment") (i) for Hazardous Materials contamination in, about or beneath the
Premises, the Building or the Project as a result of such activities and (ii) to
assess all Environmental Activities of Tenant and Tenant's Agents on the
Premises or the Project for
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compliance with all applicable laws, ordinances and regulations and for the use
of procedures intended to reasonably reduce the risk of a release of Hazardous
Materials. The Environmental Assessment shall be performed in a manner
reasonably calculated to discover the presence of Hazardous Materials
contamination and shall be of a scope and intensity reflective of the general
standards of professional environmental consultants who regularly provide
environmental assessment services in connection with the transfer or leasing of
real property. Additionally, the Environmental Assessment shall take into full
consideration the past and present uses of the Property and Project and other
factors unique to the Property and Project. If Landlord obtains the
Environmental Assessment because of the activities of Tenant or Tenant's Agents,
Tenant shall pay Landlord on demand the cost of the Environmental Assessment,
with interest thereon, as additional rent and in accordance with subparagraph
17(d). If Landlord so requires, Tenant shall comply, at its sole cost and
expense, with all recommendations contained in the Environmental Assessment,
including any recommendation with respect to the precautions which should be
taken with respect to Environmental Activities on the Premises or the Project or
any recommendations for additional testing and studies to detect the presence of
Hazardous Materials. Tenant covenants to reasonably cooperate with the
Consultant and to allow entry and reasonable access to all portions of the
Premises for the purpose of Consultant's investigation.
(m) SURRENDER OF PREMISES - ENVIRONMENTAL CONSIDERATIONS. Prior to or
after the expiration or termination of the Lease Term, Landlord may have an
Environmental Assessment of the Property performed in accordance with
subparagraph (l) above. Tenant shall perform, at its sole cost and expense, any
Remedial Work recommended by the Consultant which is necessary to remove,
mitigate or remediate any Hazardous Materials contamination of the Premises,
Building, Property or Project in connection with any Environmental Activities of
Tenant or Tenant's Agents. Prior to surrendering possession of the Premises,
Tenant shall also, unless otherwise directed by Landlord, remove any personal
property, equipment, fixture (except for any fixture installed by Landlord)
and/or storage device or vessel on or about the Premises, Building, Property
and/or Project which is contaminated by or contains Hazardous Materials as a
result of the activities of Tenant or Tenant's Agents and repair all damage to
the Premises, the Building and the Project caused by such removal.
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In addition to the above terms and conditions, the following also applies:
20. The only Broker recognized by all parties to this lease agreement is CB
Commercial.
21. The Landlord will not lease to another Call Center in Metro Business
Park Phase I as long as the Tenant is not in default of their lease
agreement.
22. QUIET ENJOYMENT. Landlord covenants that on or before the commencement
date it will have good title to the Premises, free and clear of all
liens and encumbrances, excepting only the lien for current taxes not
yet due, such mortgage or mortgages as are permitted by the terms of
this tease, zoning ordinances and other building and fire ordinances
and governmental regulations relating to the use of such property, and
easements, restrictions and other conditions of record. Landlord
represents that it has the authority to enter into this Lease and that
so long as Tenant pays all amounts due hereunder and performs all other
covenants and agreements herein set forth, Tenant shall peaceably and
quietly have, hold and enjoy the Premises for the term hereof without
hindrance or molestation from Landlord, subject to the terms and
Provisions of this Lease.
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IN WITNESS WHEREOF, the undersigned have executed this Lease as of the date and
year first above written.
"LANDLORD" "TENANT"
EastGroup Properties, ANASAZI, Inc.,
A Maryland Real Estate Investment Trust A Delaware Corporation
BY: /s/ XXXXXXXX [ILLEGIBLE] BY: /s/ [ILLEGIBLE]
---------------------------- ------------------------
IT'S: Vice President IT'S: President & Coo
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TENANT ACKNOWLEDGMENTS:
CORPORATE
STATE OF Arizona )
) ss.
County of [ILLEGIBLE] )
On this the 11th day of February 1997, before me, the undersigned
Notary Public, personally appeared [ILLEGIBLE], who acknowledged himself to be
the President of Anasazi Inc., a corporation, and that he, as such officer,
being authorized so to do, executed the foregoing instrument for the purposes
therein contained, by signing the name of the corporation, by himself as such
officer.
IN WITNESS WHEREOF, I and hereunto set my hand and official seal.
/s/ [ILLEGIBLE]
-------------------------
Notary Public
My Commission Expires:
6-24-97
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EXHIBIT A
THE PREMISES
The Premises is approximately 27,681 square feet of building A of Metro Business
Park Phase I Located at 00000 X. 00xx.., Xxxxxxx XX 00000.
PREMISES
[XXXXXX LOGO]
[FLOOR PLAN]
[METRO BUSINESS PARK]
[PHASE I]
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EXHIBIT B
PRELIMINARY PLANS
Tenant is to Lease suites A-104 (13,200 square feet), Suite A-103 (5,881 square
feet) and Suite A-102 (8,600 square feet) in "AS IS" condition. Tenant will
build out the suite to Xxxxxx Properties, Inc. building standards and as per
Exhibit B(a) which is attached.
PREMISES
Metro Business Park Phase I
11048 X. 00xx xxxxxx - Xxxxx X-000 - Xxxxxxx
13,000 Rentable sq. ft. - Offices. 2,696 sq. ft. = 21%-SCALE-1/16"=1'-0"
[FLOOR PLAN]
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EXHIBIT B(a)
[FLOOR PLAN]
ANASAZI
METRO BUSINESS PARK
00000 XXXXX 00xx XXX
XXXXXXX, XXXXXXX
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EXHIBIT D
HAZARDOUS MATERIAL
"NONE"
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EXHIBIT E
OPTION TO EXTEND LEASE TERM
Provided that at the time of exercise Tenant is not and had not been in default
under any term or provision of this Lease, then, upon the expiration of the
original term hereof, Tenant shall have the option to extend the term of this
Lease for an additional period of [See Below] years, ("the Extended Term") upon
the same terms and conditions set forth herein, so far as applicable, except
that Tenant shall have no further allowance for Tenant Improvements, no
additional option to extend the term hereof, and that rent for the option period
shall be ninety-five percent (95%) of market rent for a similar lease
transaction, adjusted, if appropriate, over the duration of the option term,
that would be charged for a comparable property in the general geographical area
in which the leased premises are located.
In the event the Tenant wishes to exercise this option to extend the term of the
Lease, Tenant shall give Landlord written notice of such election between 270
and 180 days prior to expiration of the original term. Upon receipt of that
notice, Landlord and Tenant shall attempt to determine the rental rate for the
Extended Term. In determining the rental rate for the Extended Term at the time
of exercise of the option, Landlord within five (5) business days of the notice
of exercise, shall present Tenant in writing with its lease terms for the
Extended Term, including the proposed rental rate. Within ten (10) business days
thereafter, Tenant shall either accept the rental rate proposed by the Landlord,
or shall present Landlord in writing with its proposed rental rate. Within five
(5) business days thereafter, Landlord shall either accept that rate, or notify
Tenant that the proposed rate is unacceptable. In the latter case, Landlord and
Tenant shall present the issue of rental rate to an appraiser or other third
party chosen by the Landlord and agreeable to the Tenant ("the Appraiser") for
determination. In making the determination of rental rate, the Appraiser shall
consider all relevant terms of the Lease proposed for the Extended Term, and
shall make a determination of the rental rate for comparable space in the
general geographic area of the Project for the proposed lease transaction. The
determination of the Appraiser of the rental rate shall be binding on both
parties for the lease for the Extended Term. The determination of the Appraiser
shall be made within thirty (30) days of the date of submission of the issue to
him.
At such time as Landlord and Tenant have agreed upon the terms of the Lease for
the Extended Term, including the rental rate, whether with or without the
services of the Appraiser, then the Landlord will prepare a Lease Amendment
extending the term of this Lease consistent with this provision, which both
parties shall execute.
If Tenant shall fail to deliver to Landlord written notice of its election to
exercise this option between 270 and 180 days prior to expiration of the
original term, then this option shall expire and be of no further force or
effect.
9/29/93
Tenant shall have three (3) one (1) year options to renew the lease.
Those options will be as follows:
A104 & A102 Three One year options: From 04/01/00 - 03/31/01
04/01/01 - 11/30/01
12/01/01 - 12/31/02
A101 & A103 One One (1) year option: From 12/01/01 - 12/31/02
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EXHIBIT F
RIGHT OF FIRST REFUSAL
Provided that at the time of exercise Tenant is not and had not been in default
under any term or provision of this Lease, then, during the original term of
this Lease, Tenant shall have the right of first refusal to lease that certain
additional space in the Project consisting of approximately 7,519 square feet
and described as Suite A-100, as outlined on the floor plan attached hereto as
"Exhibit" ("the Additional Space"). In the event that Landlord shall receive a
bona fide offer, as hereinafter defined, from a third party or entity to lease
all or a portion of the Additional Space at any time during the original term of
the Lease, which offer Landlord desires to accept, Landlord shall promptly give
Tenant written notice of such offer, which notice shall describe all of the
provisions thereof. Within (5) five business days of the date of mailing of that
notice, Tenant shall give Landlord written notice of its election to lease that
portion of the Additional Space referred to in the offer, at the rental rate and
upon all other terms and conditions described in the offer, and subject to all
other terms and conditions of this Lease, as applicable. If the offer is for
space in the Project greater than the Additional Space, but encompassing the
Additional Space, then, in exercising this right, Tenant must lease the entire
space subject to the offer, not only the Additional Space.
If Landlord fails to receive written notice of Tenant's election to lease the
space as set forth in the offer within such 5-business day period, then Landlord
may proceed to lease to the third party the Additional Space as set forth in the
offer, and Tenant's rights as set forth in this Section shall expire and be of
no force and effect through the Lease term.
It Landlord receives written notice of Tenant's agreement to lease the space
referred to in the offer within that period, then Landlord and Tenant shall
enter into a Lease Amendment evidencing the lease of that space to Tenant upon
the terms and conditions of the offer, and subject to all other provisions of
the Lease, as applicable, and that space referred to in the offer shall be
included in the leased premises and leased to Tenant.
For purposes of this Section, the term "bona fide offer" shall mean an offer in
writing from a third person or entity, executed by such third person or a
representative of the entity, setting forth the basic provisions of the offered
Lease.
9/29/93
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EXHIBIT F. RIGHT OF FIRST REFUSAL. This Right of First Refusal will continue
through the term of this Lease and any renewal option periods.
Notice may also be given by fax but only if it is followed by a confirmation of
receipt phone call.
If Landlord does not lease it's space to the third (3rd) party related to this
Right of First Refusal, then the Tenant's Right of First Refusal will be
restored, only through March 31, 2000.
The term of the Right of First Refusal space shall be coterminius with the rest
of the Tenant's lease.
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EXHIBIT G
Tenant has the Right Of First Refusal for the indicated 7,519 square feet
[FLOOR PLAN]
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FIRST AMENDMENT TO LEASE
That certain lease dated January 31, 1997 by and between EastGroup Properties,
Landlord, and Anasazi, Inc., Tenant, for the premises located at 00000 X 00xx
Xxxxxx, Xxxxxxxx X, Xxxxx 000, 103, 104, is amended this 7th day of August, 1997
solely as hereinafter described.
Effective the 15th day of August, 1997, the clauses below are substituted for
like numbered clauses in the Lease agreement.
1(b) Street Address of Premises:
00000 X. 00xx Xxxxxx, Xxxxxx X000--X000
Xxxxxxx, XX 00000
00000 X. 00xx Xxxxxx, Xxxxx X000
Xxxxxxx, XX 00000
1(d) Approximate Square Footage of Premises:
A104 -- 13,200 sf
A103 -- 5,881 sf
A102 -- 8,600 sf
B101 -- 13,063 sf
1(h) Term:
A104 2/15/97 -- 3/31/00
A102 4/01/97 -- 3/31/00
A103 4/01/97 -- 11/30/01
B101 10/15/97 -- 12/31/02
1(i) Scheduled Commencement Date:
A104 2/15/97
A102 4/01/97
A103 4/01/97
B101 10/15/97 or the date premises is ready for
occupancy.
1(j) Fixed Rent:
2/15/97 -- 3/31/97 $10,031.98/NNN/Month (A104)
10/15/97 -- 3/31/00 $18,000.00/NNN/Month (A104, A103, A102)
10/15/97 -- 3/31/00 $12,390.67/NNN/Month (B101)
4/01/00 -- 4/30/00 $ 3,234.55/NNN/Month (A103)
4/01/00 -- 4/30/00 $12,390.67/NNN/Month (B101)
5/01/00 -- 11/30/01 $ 3,234.55/NNN/Month (A103)
5/01/00 -- 11/30/01 $14,219.49/NNN/Month (B101)
12/01/01 -- 12/31/02 $14,219.49/NNN/Month (B101)
1(1) Security Deposit:
2/15/97 -- 10/14/97 $ 27,000.00 Cash (paid 2/97)
10/15/97 -- 10/31/98 $100,000.00 Letter of Credit (due at
the signing of Amendment) and
$ 27,000.00 Cash (paid 2/97)
11/01/98 -- 12/31/02 $ 47,000.00* Cash ($27,000 paid 2/97)
* Landlord will review the Tenant's most recent financial statements and in
Landlord's sole discretion will make the decision regarding the adequacy of
such information on or before 11/01/98 with the Landlord to determine
whether or not to waive the additional $20,000 Security Deposit due 11/1/98.
1(0) Tenant's share of Operating Expenses, Insurance Expenses and Property
Taxes:
Project: 40.61%
Building B: 37.11%
Building A: 78.64%
Exhibit A
The Premises are approximately 40,744 square feet and are located at
11048 and 00000 Xxxxx 00xx Xxxxxx.
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Exhibit B
Suite A104, A103 and A102 were taken in "As Is" condition. Landlord
will provide an allowance not to exceed $250,000 for Tenant
Improvements for suite B101 including, architectural, engineering, and
city permits, cabling, and wiring. Excess Tenant Improvement monies
will be put in reserve for future use. All Tenant Improvements dollars
will be paid upon receipt of a certificate of completion from the
Architect along with all lien waivers from the contractor and
subcontractors.
Exhibit E
Along with existing options to extend Leases Tenant also has the option
to renew all suites for a three year term at market rate after the
current Options to Extend. Subject to the same notice provisions as
Exhibit E of the lease dated January 31, 1997.
Exhibit H:
Landlord gives Tenant, the Right to Cancel the lease for Suite B101
only on 3/31/00 with one hundred and eighty (180) days written notice
to Landlord and a buy-out amount of $230,l5l.06 to be paid in full on
3/31/00.
EXHIBIT I:
Landlord will provide fifty (50) reserved parking spaces in accordance
with Exhibit I, in addition to the one hundred (100) spaces provided in
the lease dated January 31, 1997.
All other terms and conditions of said Lease shall remain in full force and
effect.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the
date first written above.
"Landlord" "Tenant"
EastGroup Properties ANASAZI, INC.
a Maryland Real Estate a Delaware corporation
Investment Trust
BY: /s/ [ILLEGIBLE]
BY: /s/ XXXXXXXX XXXX ---------------------------
--------------------------
Xxxxxxxx Xxxx IT'S: President & COO
IT'S: Vice President -------------------------
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Exhibit I
Parking Schedule
[GRAPHIC]
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RIGHT OF FIRST REFUSAL
Provided that at the time of exercise Tenant is not and had not been in default
under any term or provision of this Lease, then, during the original term of
this Lease, Tenant shall have the right of first refusal to lease that certain
additional space as soon as it is vacated by AT&T in the Project consisting of
approximately 8,860 square feet and described as Suite B102, as outlined on the
floor plan attached hereto as "Exhibit I" ("the Additional Space"). In the event
that Landlord shall receive a bona fide offer, as hereinafter defined, from a
third party or entity to lease all or a portion of the Additional Space at any
time during the original term of the Lease, which offer Landlord desires to
accept, Landlord shall promptly give Tenant written notice of such offer, which
notice shall describe all of the provisions thereof. Within (5) five business
days of the date of mailing of that notice, Tenant shall give Landlord written
notice of its election to lease that portion of the Additional Space referred to
in the offer, at the rental rate and upon all other terms and conditions
described in the offer, and subject to all other terms and conditions of this
Lease, as applicable. If the offer is for space in the Project greater than the
Additional Space, but encompassing the Additional Space, then, in exercising
this right, Tenant must lease the entire space subject, to the offer, not only
the Additional Space.
If Landlord fails to receive written notice of Tenant's election to lease the
space as set forth in the offer within such 5-business day period, then Landlord
may proceed to lease to the third party the Additional Space as set forth in the
offer, and Tenant's rights as set forth in this Section shall expire and be of
no force and effect through the Lease term.
If Landlord receives written notice of Tenant's agreement to lease the space
referred to in the offer within that period, then Landlord and Tenant shall
enter into a Lease Amendment evidencing the lease of that space to Tenant upon
the terms and conditions of the offer, and subject to all other provisions
[ILLEGIBLE] applicable, and that [ILLEGIBLE]
55
Exhibit "J"
Right of First Refusal
The premises is are located at 00000 X. 00xx Xxxxxx, Xxxxx X-000, Xxxxxxx,
Xxxxxxx 00000.
[FLOOR PLAN]
Please
Initial:
/s/ [ILLEGIBLE]
/s/ [ILLEGIBLE]
56
SECOND AMENDMENT TO LEASE
That certain lease dated January 31, 1997 by and between EastGroup Properties,
Landlord, and Anasazi, Inc., Tenant, for the premises located at 11048 & 00000
X. 00xx Xxxxxx Building A & B, Suite A104, A103, A102, B101, is amended this 1st
day of November, 1997 solely as hereinafter described.
Effective the 1st day of November, 1997, the clauses below are substituted for
like numbered clauses in the Lease agreement.
1(h) Term:
A104 02/15/97 - 03/31/00
A102 04/01/97 - 03/31/00
A103 04/01/97 - 11/30/01
B101 11/10/97 - 12/31/02
1(i) Scheduled Commencement Date:
A104 02/15/97
A102 04/01/97
A103 04/01/97
B101 11/10/97
1(j) Fixed Rent
02/15/97 - 03/31/97 @ $10,031.98/NNN/Month* (A104)
04/01/97 - 03/31/00 @ $18,000.00/NNN/Month* (A104, A103, A102)
11/10/97 - 03/31/00 @ $12,390.67/NNN/Month* (B101)
04/01/00 - 04/30/00 @ $ 3,234.55/NNN/Month* (A103)
04/01/00 - 04/30/00 @ $12,390.67/NNN/Month (B101)
05/01/00 - 11/30/01 @ $ 3,234.55/NNN/Month* (A103)
05/01/00 - 11/30/01 @ $14,219.49/NNN/Month* (B101)
12/01/01 - 12/31/02 @ $14,219.49/NNN/Month* (B101)
*Plus applicable rental taxes.
All other terms and conditions of said Lease shall remain in full force and
effect.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the
date first written above.
"LANDLORD" "TENANT"
EastGroup Properties Anasazi, Inc.
a Maryland Real Estate Investment Trust a Delaware corporation
BY: /s/ XXXXXXXX XXXX By: /s/ [ILLEGIBLE]
------------------ -----------------
Its: Vice President Its: [ILLEGIBLE]
----------------
57
[PEGASUS SOLUTIONS LETTERHEAD]
September 27, 2000
CERTIFIED MAIL
Xx. Xxxxxxx X. Xxxxxx
Senior Vice President
EastGroup Properties
0000 Xxxx Xxxx Xxxxx, Xxxxx 000
Xxxxx, XX 00000
RE: NOTICE TO EXERCISE OPTION TO RENEW
SUITES A-102 AND A-104
SECOND NOTICE
Dear Xx. Xxxxxx:
On September 6, 2000, our agent, Xxxxx Xxxxx of CB Xxxxxxx Xxxxx, sent to Xx.
Xxxxxxxx Xxxxxx, via certified mail, Notice To Exercise Option to Renew for the
period 4/1/01-11/30/01, pursuant to Exhibit "E" of the Lease dated January 31,
1997 between Pegasus Solutions Companies, formerly REZsolutions, Inc.,
formerly Anasazi Inc. ("Tenant") and EastGroup Properties ("Landlord") and
amended by the First Amendment To Lease dated August 7, 1997 and further amended
by the Second Amendment dated November 1, 1997, and Third Amendment dated
November 2, 1999. This Notice, a copy of which is attached, was received at your
offices at 0000 Xxxx Xxxx, Xxxxx 000, Xxxxx, Xxxxxxx 00000 on September 8, 2000,
and was signed for by one of your employees.
In addition, you have had conversations concerning this renewal with our agent,
Xxxxx Xxxxx, both prior to and subsequent to receipt of the Notice to Exercise.
Per Exhibit E of the Lease, "Landlord, within five (5) business days of the
notice of exercise, shall present Tenant in writing with its lease terms for the
Extended Term, including the proposed rental rate". As of the date of this
letter, approximately thirteen (13) business days have expired, and EastGroup
has failed to provide Tenant or its agent with Landlord's terms, as required by
the lease.
Please be aware that Tenant fully intends to exercise its renewal option for
the period 4/1/01-11/30/01, and that Tenant hereby certifies that it has not
waived any of its rights as a result of Landlord's failure to comply with the
terms of Exhibit "E" of the Lease.
Sincerely,
/s/ XXXXX XXXXXXXXX
Xxxxx Xxxxxxxxx
Director of Facilities
58
[PEGASUS SOLUTIONS LETTERHEAD]
Cc: Xxxxx Xxxxx -- CB Xxxxxxx Xxxxx
Xxxxxxxx Xxxxxx -- EastGroup Properties (certified mail)
59
[PEGASUS SOLUTIONS LETTERHEAD]
September 6,2000
CERTIFIED MAIL
Xx. Xxxxxxxx Xxxxxx
Property Manager
EastGroup Properties
0000 Xxxx Xxxx, Xxxxx 000
Xxxxx, Xxxxxxx 00000
RE: NOTICE TO EXERCISE OPTION TO RENEW
SUITES A-102 AND A-104
Dear Xxxxxxxx:
This letter serves as official notice for Pegasus Solutions Companies, formerly
Rezsolutions, Inc., formerly Anasazi Inc., to exercise its option to renew the
Lease for Suites A-102 and A-104, located at 00000 Xxxxx 00xx Xxxxxx, Xxxxxxx,
Xxxxxxx 00000. This notice is provided pursuant to the agreed-upon terms, as
outlined in Exhibit "E" of the Lease dated January 31, 1997, between Anasazi
Inc. ("Tenant") and EastGroup Properties ("Landlord") and amended by the First
Amendment To Lease dated August 7, 1997 and further amended by the Second
Amendment dated November 1, 1997, and Third Amendment dated November 2, 1999.
Pursuant to Exhibit "E", Landlord has five (5) business days from receipt of
this notice to provide Tenant with its offer for the Extended Term.
Pursuant to Exhibit "E", the Extended Term shall be for a period of eight (8)
months, starting April 1, 2001 and ending November 30, 2001. Landlord's offer
should include a three percent (3%) commission paid by Landlord to Tenant's
broker, CB Xxxxxxx Xxxxx.
Sincerely,
/s/ XXXXX XXXXX
Xxxxx Xxxxx
First Vice President
Corporate Services
000-000-0000
CN/pe
cc: Xxxxx Xxxxxxxxx -- Pegasus Solutions
60
THIRD AMENDMENT TO LEASE
That certain lease dated the 31st day of January 1997, by and between EASTGROUP
PROPERTIES, L.P., A DELAWARE LIMITED PARTNERSHIP, Landlord, and ANASAZI, INC., A
DELAWARE CORPORATION, NOW KNOWN AS REZSOLUTIONS, INC., Tenant, for the premises
located at 11048 N. 23rd AVENUE, SUITES A102 AND A104, PHOENIX, ARIZONA, is
amended this 2ND DAY OF NOVEMBER 1999 as hereinafter described.
Effective the 2ND DAY OF NOVEMBER 1999, the Clauses below are substituted for
like numbered clauses in the Lease Agreement.
1.(d) APPROXIMATE SQUARE FOOTAGE OF PREMISES (PARAGRAPH 2): For Suites A102
and A104 consisting of approximately 21,800 square feet.
1.(h) TERM (PARAGRAPH 4): For Suites A102 and A104, April 1, 2000 through
March 31, 2001.
1.(i) SCHEDULED COMMENCEMENT DATE FOR A102 AND A104: April 1, 2000.
1.(j) FIXED RENT (SUBPARAGRAPH 5(a)): For Suites A102 and A104, the rental
rate will be $15,696.00 per month plus applicable rental taxes,
exclusive of all operating expenses including, but not limited to, all
common area charges, property taxes and insurance.
All other terms and conditions of said Lease shall remain in full force and
effect.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the
date first written above.
LANDLORD: EastGroup Properties, L.P., TENANT: REZsolutions, Inc., formerly
a Delaware limited partnership Anasazi, Inc.,
a Delaware Corporation
X /s/ XXXXXXXX XXXX X /s/ XXX XXXXXX
--------------------------------------- -----------------------------------
By: Xxxxxxxx Xxxx By: Xxx Xxxxxx
Its: Senior Vice President Its: President & CEO
Date: 11-18-99 Date: 11/10/99
