EXHIBIT 10.24
SINGLE TENANT INDUSTRIAL LEASE
THIS SINGLE TENANT INDUSTRIAL LEASE ("Lease") is made and entered into as
of November 15, 1999 by and between Xxxxxx Partners, L.P., a Delaware limited
partnership ("Landlord") and XxxxXxxxxx.xxx, a Delaware corporation ("Tenant").
Landlord and Tenant mutually covenant and agree that Landlord, in
consideration of the rent payable by Tenant and the covenants and agreements to
be kept, observed and performed by Tenant, hereby rents and leases to Tenant,
and Tenant hereby takes and hires from Landlord, the "Premises" (as defined
herein), pursuant to the provisions of this Lease, subject to (i) all applicable
zoning, municipal, county, state and federal laws; (ii) covenants, conditions,
restrictions, reservations, easements, rights and rights-of-way of record; and
(iii) Performance Standards attached hereto as Exhibit A and incorporated herein
by reference. In the event of any conflict between the provisions of this Lease
and the provisions of the Performance Standards, the provisions of this Lease
shall govern.
ARTICLE I
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Basic Lease Provisions
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1.1 Description of Premises The Premises, as referred to herein, shall
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consist of the parcel of land located in the County of Los Angeles, State of
California, as more particularly described in the attached Exhibit B (the
"Land"); the multi-purpose office, warehouse and industrial building located on
the Land (the "Building") together with the appurtenant improvements located on
the Land; and any other improvements or additions made by either Landlord or
Tenant which become a part of the Premises in accordance with the provisions of
this Lease.
1.2 Street Address of Premises: 00000 Xxxxxxxxx Xxxxxx, Carson,
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California.
1.3 Approximate Building Square Footage: 116,488 square feet.
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1.4 Lease Term: Ten (10) years beginning on January 15, 2000 or such other
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date as is determined pursuant to the provisions of this Lease (the
"Commencement Date") and ending on January 14, 2010 (the "Termination Date"),
subject to the provisions of Paragraph 3.2, below.
1.5 Extension Options: Two (2) consecutive periods of five (5) years each.
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(See Paragraphs 1 and 2 of the attached Lease Rider.)
1.6 Initial Minimum Rent: Sixty-Nine Thousand Eight Hundred Ninety-Two and
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80/100ths Dollars ($69,892.80).
1.7 Periodic Rent Adjustments: See Paragraph 3 of the attached Lease
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Rider.
1.8 Initial Security Deposit: One Million Eight Hundred Thousand Dollars
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($1,800,000). [See Article XXIV, below.]
1.9 Brokers: Xxx Xxxxxxxxxx, CB Xxxxxxx Xxxxx.
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1.10 Initial Improvement Work: See Work Letter Agreement attached as
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Exhibit C.
1.11 Exhibits and Riders: The following Exhibits and Riders are attached to
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this Lease and made a part hereof:
Exhibit A - Performance Standards of Xxxxxx
Industrial Center
Exhibit B - Legal Description
Exhibit C - Work Letter Agreement
Exhibit X - Xxxxxxxxx Technology Center
Exhibit E - Form of Lease Addendum
Exhibit F - Hazardous Material Certificate
Exhibit G - Form of Estoppel Certificate
Exhibit H - Improvement Allowance Items
Lease Rider Number 1
1.12 Mailing Addresses:
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Landlord: Xxxxxx Partners, L.P.
00000 Xxxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Tenant: XxxxXxxxxx.xxx, Inc.
00000 Xxxxxxxxx Xxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Legal Department
ARTICLE II
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Construction of Premises
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2.1 Landlord shall, at its sole cost and expense, construct certain "Base
Building Improvements" on the Land as described in Schedule C-1 of the
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attached Work Letter Agreement. Alterations to the Base Building Improvements
requested by Tenant, together with office improvements and other improvements
requested by Tenant (collectively, "Tenant Improvements") shall be constructed
by Tenant at Tenant's expense in accordance with the Work Letter Agreement.
Tenant acknowledges that promptly following written notice from Landlord of the
"Substantial Completion" (as defined in the Work Letter Agreement) of the Base
Building Improvements, Landlord and Tenant shall jointly inspect the Base
Building Improvements and shall prepare a single list of any defects or
deficiencies in the Base Building Improvements construction (the "Base Building
Punchlist"). Except for items noted on the Base Building Punchlist and latent
structural defects in the Base Building Improvements that could not have been
discovered by Tenant based upon a reasonable and diligent visual inspection of
the Premises as of the date of Substantial Completion, Tenant shall be deemed to
have accepted the Premises in its then existing condition and state of repair.
2.2 Tenant acknowledges that neither Landlord nor any real estate agent or
broker representing Landlord or Tenant has made any representation or warranty
as to the present or future suitability of the Premises for the conduct of
Tenant's business. Landlord represents to Tenant as of the Commencement Date,
the Base Building Improvements shall comply with laws, codes, ordinances, rules
and regulations ("collectively, Codes") applicable to the design and
construction of the Base Building Improvements at the time the Base Building
Improvements were constructed. Landlord agrees that upon the date on which
occupancy of the Premises is delivered to Tenant, the "Building Systems" (as
defined herein) shall be in good working order. As used herein the term
"Building Systems" shall mean the mechanical, plumbing, HVAC, and electrical
systems of the Base Building Improvements and all loading doors of the Building.
If, within sixty (60) days following the date on which Tenant commences
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business operations on the Premises, Tenant discovers and advises Landlord in
writing that any such item is not in good working order, then Landlord shall
repair such item at Landlord's sole cost and expense.
2.3 In the event that, as of the Commencement Date, the Base Building
Improvements are in violation of the requirements of Title III of the Americans
with Disabilities Act ("ADA") applicable to the Building with respect to the use
of the Building for general warehouse, manufacturing and related office purposes
(but not for any use constituting a "public accommodation" under the ADA), for
any reason other than as a result of Tenant's acts, specific use of the
Premises, or improvements or alterations made by or for Tenant, Landlord shall,
at its sole cost and expense, cause the same to be rectified at no cost to
Tenant to the extent required by applicable law.
2.4 The Premises and the Building are located within a complex of
properties commonly known as Xxxxxxxxx Technology Center which currently
consists of the properties shown in the attached Exhibit D. The configuration
and boundaries of the Xxxxxxxxx Technology Center and the "Xxxxxxxxx Technology
Center Common Area" (as defined below) may be modified by Landlord from time to
time to add, withdraw or reconfigure properties or boundaries, as Landlord may
determine in its sole and absolute discretion. However, no such alteration to
the Xxxxxxxxx Technology Center Common Area shall unreasonably interfere with
Tenant's use of the Premises, including, without limitation, ingress and egress
and parking.
2.5 The term "Xxxxxxxxx Technology Center Common Area," as used in this
Lease, shall mean the thirty (30) foot perimeter setback landscaping, detention
basins, curvilinear sidewalks and monument signs within the exterior boundaries
of the Xxxxxxxxx Technology Center. The manner in which the Xxxxxxxxx
Technology Center Common Area shall be maintained shall be determined by
Landlord, in its sole discretion. The Xxxxxxxxx Technology Center Common Areas
shall be repaired and maintained by Landlord subject to Tenant's contribution
toward "Xxxxxxxxx Technology Center Common Area Expenses" (as defined below) as
provided in Paragraph 2.7.
2.6 The term "Xxxxxxxxx Technology Center Common Area Expenses," as used
in this Lease, shall mean all costs and expenses incurred by Landlord in (a)
operating, insuring, repairing and maintaining the Xxxxxxxxx Technology Center
Common Area. Xxxxxxxxx Technology Center Common Area Expenses shall include,
without limitation, expenses for maintaining, landscaping, repairing, painting,
lighting, fencing and cleaning the Xxxxxxxxx Technology Center Common Area,
nonrefundable contributions toward one or more reserves for replacements or
major repairs; expenses, charges, costs of compliance and other costs related to
the requirements of any Federal, state or local governmental agency; expenses
related to the Xxxxxxxxx Technology Center Common Area; and public liability and
property damage insurance on the Xxxxxxxxx Technology Center Common Area.
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2.7 From and after the Commencement Date, Tenant shall pay to Landlord, on
the first day of each calendar month "Tenant's Allocated Share" (as defined
herein) of the Xxxxxxxxx Technology Center Common Area Expenses, together with
the Landlord's administrative fee . The total amount of Tenant's share of the
Xxxxxxxxx Technology Center Common Area Expenses ("Tenant's Allocated Share")
and the Landlord's administrative fee shall be One Thousand Seven Hundred Forty-
Seven Dollars ($1,747.00) per month.
2.8 The Premises will be served by a fire pumphouse and related pipelines,
pumps, valves, gates, connections and other equipment located outside of the
Building (collectively referred to herein as the "Fire System") and necessary
for the operation of the ESFR fire suppression system for the Premises and the
adjacent Xxxxxx Legacy Series Building 658 (the "658 Property)". Landlord shall
inspect, maintain, repair and replace the Fire System and any components of the
Fire System to the extent necessary to keep the Fire System in good working
order. Tenant shall be responsible for paying its proportional share of the
costs and expenses of the inspection, maintenance, repair and replacement of the
Fire System and any components of the Fire System (the "System Costs"), subject
to the limitations set forth in Paragraph 4.2. Tenant's share of the System
Costs shall be determined by multiplying the total System Costs by a fraction,
the numerator of which shall be the building floor area (measured on a
"dripline" basis) of all buildings located on the Premises, and the denominator
of which shall be the total building floor area of all buildings located on the
Premises and the 658 Property. Landlord shall, from time to time, but not more
often than once each calendar quarter, and not less often than once each
calendar year, deliver to Tenant a written statement indicating the total System
Costs incurred by the Landlord since the date of the last such statement, and
setting forth Tenant's proportional share of such costs. Within thirty (30)
days after receipt of such statement, Tenant shall pay to Landlord, as
additional rent, Tenant's proportional share of the System Costs. Tenant's
proportional share of the System Costs shall be limited to the fair market value
of the goods and services involved, shall be reasonably incurred, and shall be
substantiated by documentary evidence available for inspection and review by
Tenant or its representative during normal business hours.
ARTICLE III
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Term of Lease
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3.1 The term of this Lease (the "Lease Term") shall be ten (10) years.
Subject to the terms and conditions of this Lease, the Lease Term shall commence
on the Commencement Date and shall terminate on the Termination Date, which
dates are specified in Item 1.4 of the Basic Lease Provisions.
3.2 If Landlord is unable to deliver possession of the Premises to Tenant
by the Commencement Date specified in Item 1.4 of the Basic Lease
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Provisions, for any reason (other than a delay which is attributable to any act
or omission of Tenant, in which event the Lease Term shall be deemed to have
commenced on the date specified in Item 1.4 of the Basic Lease Provisions), the
Lease Term shall not commence until possession of the Premises is delivered to
Tenant. For the purposes of this Paragraph 3.2, delivery of possession of the
Premises to Tenant shall be deemed to occur on January 15, 2000, so long as
construction of the Base Building Improvements has been "Substantially
Completed" (as defined in the Work Letter Agreement) as of such date. If
construction of the Base Building Improvements have not been Substantially
Completed by January 15, 2000, the delivery of possession of the Premises shall
occur on the date of "Substantial Completion" (as defined in the Work Letter
Agreement) of the Base Building Improvements. If Landlord or Tenant so desire,
Landlord and Tenant shall execute a Lease Addendum in the form attached to this
Lease as Exhibit E, confirming the actual Commencement Date and Termination Date
of the Lease Term. Landlord shall not be liable for any damage caused by any
delay in delivery of the Premises to Tenant. If Landlord does not deliver
possession of the Premises to Tenant by the date specified in Item 1.4 of the
Basic Lease Provisions (unless the delay in delivering possession by such date
is caused by "Tenant Delays", as defined herein and in the attached Work Letter
Agreement), Tenant shall not be liable for rent until Landlord delivers
possession of the Premises to Tenant, and the Lease Term shall be extended for a
period of time equal to the period of such delay; provided, however, that (i) if
the Base Building Improvements are not Substantially Completed within ninety
(90) days following the date specified in Item 1.4 of the Basic Lease Provisions
(such ninety (90) day period shall be extended day for day for any "Tenant
Delays", as defined herein and in the attached Work Letter Agreement), Tenant
shall have the right to terminate this Lease by giving written notice to
Landlord at any time after lapse of said ninety (90) day period, unless Landlord
has Substantially Completed the Base Building Improvements before Tenant gives
such notice to Landlord; and (ii) if the Base Building Improvements are not
Substantially Completed within thirty (30) days following the date specified in
Item 1.4 of the Basic Lease Provisions (such thirty (30) day period shall be
extended day for day for any "Tenant Delays", as defined herein and in the
attached Work Letter Agreement), then Landlord shall pay to Tenant, as
liquidated damages for such delay, the amount of One Thousand Dollars
($1,000.00) per day for each day following the end of such thirty (30) day
period until the Base Building Improvements are Substantially Completed. Tenant
shall not be liable for rent until Landlord delivers possession of the Premises
to Tenant, and the Lease Term shall be extended for a period of time equal to
the period of such delay. If the Lease Term commences on a day other than the
first day of a calendar month, the Lease Term shall end on the last day of the
calendar month in which said Lease Term would otherwise end.
3.3 Commencing on the date on which (a) this Lease is fully executed and
delivered; (b) the security deposit has been received by Landlord; and (c) the
Base Building Improvements have progressed to a point sufficient to permit
Tenant to enter onto the Premises without impeding or interfering with
Landlord's remaining work on the Building, and continuing until the Commencement
Date (the "Early Occupancy Period")
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Tenant and its agents, employees, contractors, and vendors shall be permitted to
enter such portion of the Premises for the purposes of installing Tenant's
furniture, fixtures, utilities, telecommunication systems, equipment and
machinery and for constructing the Tenant Improvements. Tenant agrees that
throughout the Early Occupancy Period, Tenant shall conduct its activities on
the Premises in such a way so as not to interfere with, disrupt or delay
Landlord's work or activities relating to the Base Building Improvements, and
any delay resulting from any such interference, disruption or delay shall be a
"Tenant Delay". Landlord shall have no responsibility for any damage, theft,
destruction or injury to Tenant or any of Tenant's property as a result of
Tenant's presence or activities on, or use of, the Premises during the Early
Occupancy Period. Landlord makes no representations as to whether Tenant's
occupancy of the Premises during the Early Occupancy Period will be in
compliance with applicable building, safety or fire codes, and Tenant shall be
responsible for, and assumes the risk of any non-compliance. Tenant shall
require that all of its contractors, vendors, consultants and design
professionals who will be present on the Premises during the Early Occupancy
Period maintain liability, property damage, workers compensation and other
insurance in the same form and amounts as Landlord customarily requires for such
persons performing work for Landlord on Landlord's properties and naming
Landlord and Tenant as additional insureds under such policies. During the Early
Occupancy Period, Tenant shall not be obligated to pay Minimum Rent, but any use
or occupancy of the Premises by Tenant pursuant to this Paragraph 3.3 shall be
subject to, and in accordance with, all other terms and conditions of this Lease
including, without limitation, the indemnification provisions of this Lease and
the provisions of this Lease requiring Tenant to pay for all utilities serving
the Premises.
ARTICLE IV
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Rent
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4.1 Tenant agrees to pay to Landlord at the office of Landlord or at such
other place as may be designated by Landlord from time to time, without any
prior demand therefor and without any deduction, recoupment or setoff
whatsoever, as minimum monthly rent ("Minimum Rent"), the sum specified as the
Initial Minimum Rent in Item 1.6 of the Basic Lease Provisions. Minimum Rent
shall be payable in advance on the first day of each calendar month of the Lease
Term. If the Lease Term shall commence upon a day other than the first day of a
calendar month, then Tenant shall pay, upon the Commencement Date, a pro rata
portion of the Minimum Rent for the first fractional calendar month. Minimum
Rent payable by Tenant under this Lease is subject to adjustment in accordance
with the provisions of Item 1.7 of the Basic Lease Provisions. Unless
specifically designated otherwise in this Lease, all fees, charges, costs,
expenses or other payments to be paid by Tenant to Landlord pursuant to this
Lease shall be deemed to be additional rent.
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4.2 The Minimum Rent is to be a "net net net rental" as those terms are
used and understood in the real property leasing business. Accordingly, and as
additional rent hereunder, Tenant shall pay during the Lease Term, and prorated
to the Commencement Date and Termination Date of the Lease Term, all real estate
taxes (as defined in Paragraph 5.5) levied against the Premises, or any portion
thereof, public utility and related costs and expenses, premiums for insurance
described in Article VIII hereof, expenses of occupying, operating, altering,
maintaining and repairing the entire Premises as provided in this Lease, and any
other expenses or charges which shall be levied, assessed or imposed by any
governmental authority upon or with respect to, or incurred in connection with,
the possession, occupation, operation, alteration, maintenance, repair and use
of the Premises during, or with respect to, the Lease Term, it being intended
that this Lease shall result in a rent to be paid to Landlord, without
additional cost to Landlord or diminution or offset, in the amount specified
herein. Notwithstanding the foregoing, Tenant shall not be obligated to pay for
any maintenance, repair or replacement necessitated by: (i) a breach of the
warranty contained in Paragraph 2.2; (ii) any latent structural defect in the
design or construction of the Base Building Improvements; or (iii) the
negligence of Landlord, its agents, employees or contractors. The obligations of
Landlord and Tenant regarding Hazardous Materials are governed by Paragraphs 9.7
through 9.11, inclusive, and are not affected by the provisions of this
Paragraph 4.2.
ARTICLE V
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Taxes and Assessments
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5.1 Tenant covenants and agrees to pay and discharge, as additional rent
hereunder, all real estate taxes and assessments, and installments thereof which
may be taxed, charged, levied, assessed or imposed during the Lease Term and any
extensions or renewals thereof upon all or any portion of or in relation to the
Premises and the improvements at any time erected thereon and the appurtenances
thereof. At the same time as Tenant makes its payments of Minimum Rent as
provided in Article IV, above, Tenant shall pay to Landlord a monthly
installment payment of the annual real estate taxes which Tenant is obligated to
pay pursuant to this Article V. Such monthly installment payments of real
estate taxes shall be paid on an estimated basis, with subsequent annual
reconciliation, in accordance with the procedures set forth in this Article V.
5.2 During December of each calendar year during the Lease Term, or as
soon thereafter as practicable, Landlord shall give Tenant notice of its
estimate of the amount of the monthly installment payments of real estate taxes
for the next calendar year. On or before the first day of each month during the
ensuing calendar year, Tenant shall pay to Landlord one-twelfth (1/12th) of such
estimated real estate taxes, provided that if such notice is not given in
December, Tenant shall continue to pay on the basis of the prior year's estimate
until such revised estimate is delivered, from and after which time (commencing
with the first day of the next calendar month
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after such notice is given) Tenant shall pay such amount as is necessary to
bring Tenant current with respect to such revised estimate for such calendar
year, as if such revised estimate had been delivered in December, and thereafter
monthly payments shall be based on such revised estimate, unless and until
further revised in accordance herewith. If at any time or times it appears to
Landlord that the real estate taxes for the current calendar year will vary from
its estimate, Landlord may, by notice to Tenant, revise its estimate for such
year, and subsequent monthly payments by Tenant for such year shall be based
upon such revised estimate.
5.3 Within ninety (90) days after the close of each calendar year or as
soon after such ninety (90) day period as is practicable, Landlord shall deliver
to Tenant a statement of the actual real estate taxes for such calendar year,
supported by copies of property tax bills covering the year in question. If
Landlord's statement discloses that Tenant owes an amount that is less than the
estimated payments for such calendar year previously made by Tenant, Landlord
shall credit such excess first against any sums then owed by Tenant to Landlord
and then against the next payments of rent due hereunder. If Landlord's
statement discloses that Tenant owes an amount that is more than the estimated
payments for such calendar year previously made by Tenant, Tenant shall pay the
deficiency to Landlord within thirty (30) days after delivery of the statement.
The failure of Landlord to timely furnish the statement for any calendar year
shall not prejudice Landlord from enforcing its rights hereunder. Tenant shall
have the right, at its sole cost and expense, to cause an audit of real estate
taxes subject to the following provisions. Such audit shall be made by an
independent nationally recognized certified public accounting firm upon at least
thirty (30) days prior written notice to Landlord and shall be made if at all,
within ninety (90) days following Tenant's receipt of Landlord's statement
described in this Paragraph 5.3. Any adjustment to real estate taxes resulting
from such audit shall be made in the same manner as provided above for the
annual reconciliation of real estate taxes. The amount of real estate taxes for
any partial calendar year in the Lease Term shall be appropriately prorated. The
termination of this Lease shall not affect the obligations of Landlord and
Tenant pursuant to Paragraph 5.2, above to be performed after such termination.
5.4 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 in the Premises or elsewhere. Whenever possible,
Tenant shall cause said trade fixtures, furnishings, equipment and all other
personal property to be assessed and billed separately from the real property of
Landlord. If any of Tenant's said personal property shall be assessed with
Landlord's real property, Tenant shall pay to Landlord the taxes attributable to
Tenant's personal property in the same manner as the payment of real estate
taxes as provided herein.
5.5 As used herein, the term "real estate taxes" shall include any form of
real estate tax or assessment, general, special, ordinary or extraordinary, and
any license fee, commercial rental tax, rental excise tax, improvement bond or
bonds, levy or tax (other than income taxes) imposed on the Premises by any
authority having the
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direct or indirect power to tax, including any city, state or the federal
government, or any school, agricultural, sanitary, fire, street, drainage, water
or other improvement district thereof, as against any legal or equitable
interest of Landlord in the Premises or in the real property of which the
Premises are a part, as against Landlord's right to rent or other income
therefrom, and as against Landlord's business of leasing the Premises. The term
"real estate taxes" shall also include any tax, fee, levy, assessment or charge
(i) in substitution of, partially or totally, any tax, fee, levy, assessment or
charge hereinabove included within the definition of "real estate tax"; or (ii)
the nature of which was hereinbefore included within the definition of "real
estate tax"; or (iii) which is imposed as a result of a transfer, either partial
or total, of Landlord's interest in the Premises or which is added to a tax or
charge previously included within the definition of real property tax by reason
of such transfer; or (iv) which is imposed by reasons of this transaction, any
modifications or changes hereto, or any transfers hereof; provided, however,
that the definition of "real estate taxes" shall not include any excess profits
taxes, franchise taxes, gift taxes, capital stock taxes, inheritance and
succession taxes, estate taxes, or federal and state income taxes.
5.6 Tenant shall have the right, in Tenant's or Landlord's name, but at
Tenant's sole cost and expense, to contest the validity of any tax or assessment
or assessed valuation of the Premises by appropriate proceedings timely
instituted; provided that: (a) Tenant gives Landlord written notice of Tenant's
intention to do so; (b) Tenant makes timely payment to Landlord of all taxes
payable by Tenant pursuant to this Article V; (c) Tenant requests Landlord, in
writing, to pay such taxes under protest; and (d) Tenant diligently prosecutes
any such contest. Landlord shall, if requested by Tenant, cooperate with Tenant
in any such proceedings, provided, however, that
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Landlord shall not be liable for any expenses whatsoever in connection
therewith, and Tenant shall protect, indemnify, and reimburse Landlord for all
claims loss, cost, liability expense, attorneys' fees or damages resulting
therefrom.
ARTICLE VI
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Utility Charges
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6.1 Tenant shall contract for, in Tenant's name, and shall pay or cause to be
paid, all charges for gas, electricity, light, heat, air-conditioning, water,
power, telephone, sewer, trash collection and waste removal and/or disposal,
security or guard service, alarm systems, or other service, and any taxes,
levies or excises thereon, used, rendered or supplied to Tenant in connection
with the Premises; and for all connection and closing charges, and any tax or
excise thereon; and for any governmental service or service subject to
governmental regulation, however described, furnished to the Premises during the
Lease Term and during any other period in which Tenant uses or occupies the
Premises. Landlord shall not be liable to Tenant for any loss, injury, damage,
disruption of business or any other harm resulting from any interruption of
utility services to the Premises, except to the extent such interruption results
from the gross negligence or willful misconduct of Landlord.
ARTICLE VII
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Hold Harmless
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7.1 Tenant covenants and agrees that Landlord shall not at any time or to any
extent whatsoever be liable, responsible, or in any way be accountable for any
loss, injury, death or damage to persons or property which at any time may be
suffered or sustained by Tenant or by any person whomsoever who may at any time
be using, occupying or visiting the Premises, or be in, on, or about the same,
whether such loss, injury, death or damage shall be caused by or in any way
result from or arise out of any act, omission or negligence of Tenant or of any
occupant, subtenant, visitor or user of any portion of the Premises or from
fire, steam, electricity, water, rain, act of God, or from breakage or leakage
or any defect in any pipes, sprinklers, or plumbing, electrical or heating and
air conditioning systems or fixtures, or from any other cause. Tenant hereby
releases Landlord and agrees to indemnify, defend, hold and save Landlord free
and harmless of, from, and against any and all claims, losses, costs,
liabilities, expenses or damages whatsoever arising out of or related to any use
or occupancy of the Premises by Tenant or any of Tenant's agents, employees,
invitees or contractors (collectively "Losses"), including attorneys' fees and
costs on account of any such Losses, except for any Losses resulting from the
gross negligence or willful misconduct of Landlord. Landlord hereby agrees to
indemnify, defend, hold and save Tenant harmless of, from and against any and
all claims, losses, costs, liabilities, expenses or damages (including
attorneys' fees and related costs) arising out of any injury to
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persons or damage to property resulting from the gross negligence or willful
misconduct of Landlord or Landlord's agents, employees or contractors.
ARTICLE VIII
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Insurance
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8.1 Landlord shall, throughout the Lease Term, at Tenant's cost and expense,
keep all buildings and improvements which may from time to time be upon or a
part of the Premises (but not Tenant's personal property, fixtures or equipment)
insured against all risks (as the term "all risk" is used in the insurance
industry), and against earthquake and flood risks, in such form and with such
policy limits as Landlord may determine from time to time, so as to provide
adequate protection of Landlord's ownership interests in the Premises at a
reasonable cost. Notwithstanding the foregoing, Landlord shall not be required
to maintain any insurance which becomes unavailable, or which becomes
commercially unreasonable for landlords to carry, in the Southern California
insurance marketplace. In the event of any insured loss, Tenant shall be liable
to Landlord for any deductible amount claimed by the insurance carrier, but
Tenant's responsibility for such deductible amount shall not exceed Two Hundred
Fifty Thousand Dollars ($250,000), measured in 1999 dollars. In the event the
premiums for the insurance carried by Landlord increase to an amount greater
than two hundred fifty percent (250%) of the amount of the premiums in effect as
of the Commencement Date (as adjusted for increases in the "CPI") and Tenant
determines that Tenant is able to provide acceptable equivalent insurance on the
Premises at a cost less than the cost of such insurance if provided by Landlord
as set forth herein, then Tenant may, upon written notice to Landlord and at
Tenant's sole cost, elect to obtain, Tenant's own insurance on the Premises in
lieu of Landlord's insurance pursuant to this Paragraph 8.1. Any such insurance
obtained by Tenant must: (i) have policy coverages, limits and deductibles in
the amounts specified by Landlord; and (ii) satisfy the requirements set forth
in this Paragraph 8.1 for coverage which would be carried by Landlord, and (iii)
satisfy the applicable requirements of Paragraph 8.6, below. If Tenant elects
to obtain such insurance, Tenant shall be responsible for any and all deductible
amounts under any insurance policies insuring the Premises, and Tenant shall be
responsible for any coinsurance amounts. Any election by Tenant to obtain its
own insurance for the Premises as provided herein shall be made by Tenant in
writing to Landlord at least thirty (30) days, but no earlier than sixty (60)
days, prior to the commencement of the next "Policy Year" (the "Election
Window"). For purposes of this Lease, the term "Policy Year" shall mean the
one-year period following the commencement date for coverage under Landlord's
then-effective insurance policy. As of the date of this Lease, the Policy Year
for Landlord's existing coverage commenced on July 22, 1999. However, the date
of commencement of subsequent Policy Years may change from time to time over the
Lease Term. Landlord agrees to provide Tenant with written notice of any change
in the commencement date of any Policy Year. If any change in the commencement
date of any Policy Year precludes Tenant from making the election to carry its
own insurance within the Election Window, Tenant shall have a
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period of thirty (30) days following Tenant's receipt of notice from Landlord of
the change in the commencement of the Policy Year during which Tenant may elect
to carry the insurance described herein. Any insurance carried by Tenant
pursuant to this Paragraph 8.1 shall have attached thereto such form of lender's
loss payable endorsement as Landlord's Lender may require. Tenant shall, upon
request of Landlord, provide Landlord with a copy of the insurance policy or
policies obtained by Tenant pursuant to this Paragraph 8.1, together with a
certificate of insurance for such policy or policies which shall confirm, among
other things, that such policy shall not be modified or cancelled without at
least thirty (30) days prior written notice to Landlord. Landlord shall also
obtain and maintain "rental value insurance" covering one year's rent (Minimum
Rent, real estate taxes, insurance premiums and landscape maintenance charges)
payable under this Lease. At the same time as Tenant makes its payments of
Minimum Rent as provided in Article IV, above, Tenant shall pay to Landlord a
monthly installment payment of the annual insurance premiums which Tenant is
obligated to pay pursuant to this Article VIII. Such monthly installment
payments of insurance premiums shall be paid on an estimated basis, with
subsequent annual reconciliation, in accordance with the procedures set forth in
this Article VIII.
8.2 During December of each calendar year during the Lease Term, or as soon
thereafter as practicable, Landlord shall give Tenant notice of its estimate of
the amount of the monthly installment payments of insurance premiums for the
next calendar year. On or before the first day of each month during the ensuing
calendar year, Tenant shall pay to Landlord one-twelfth (1/12th) of such
estimated insurance premiums, provided that if such notice is not given in
December, Tenant shall continue to pay on the basis of the prior year's estimate
until such revised estimate is delivered, from and after which time (commencing
with the first day of the next calendar month after such notice is given) Tenant
shall pay such amount as is necessary to bring Tenant current with respect to
such revised estimate for such calendar year, as if such revised estimate had
been delivered in December, and thereafter monthly payments shall be based on
such revised estimate, unless and until further revised in accordance herewith.
If at any time or times it appears to Landlord that the insurance premiums for
the current calendar year will vary from its estimate, Landlord may, by notice
to Tenant, revise its estimate for such year, and subsequent monthly payments by
Tenant for such year shall be based upon such revised estimate.
8.3 Within ninety (90) days after the close of each calendar year or as soon
after such ninety (90) day period as is practicable, Landlord shall deliver to
Tenant a statement of the actual insurance premiums for such calendar year,
supported by copies of property tax bills covering the year in question. If
Landlord's statement discloses that Tenant owes an amount that is less than the
estimated payments for such calendar year previously made by Tenant, Landlord
shall credit such excess first against any sums then owed by Tenant to Landlord
and then against the next payments of rent due hereunder. If Landlord's
statement discloses that Tenant owes an amount that is more than the estimated
payments for such calendar year previously made by Tenant, Tenant shall pay the
deficiency to Landlord within thirty (30) days after delivery
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of the statement. The failure of Landlord to timely furnish the statement for
any calendar year shall not prejudice Landlord from enforcing its rights
hereunder. Tenant shall have the right, at its sole cost and expense, to cause
an audit of insurance premiums subject to the following provisions. Such audit
shall be made by an independent nationally recognized certified public
accounting firm upon at least thirty (30) days prior written notice to Landlord
and shall be made if at all, within ninety (90) days following Tenant's receipt
of Landlord's statement described in this Paragraph 8.3. Any adjustment to
insurance premiums resulting from such audit shall be made in the same manner as
provided above for the annual reconciliation of insurance premiums. The amount
of insurance premiums for any partial calendar year in the Lease Term shall be
appropriately prorated. The termination of this Lease shall not affect the
obligations of Landlord and Tenant pursuant to Paragraph 8.2, above to be
performed after such termination.
8.4 Landlord and Tenant agree that if the building and improvements at any
time forming a part of the Premises shall be damaged or destroyed by risks
insured against under Paragraph 8.1, or if any of Tenant's machinery, fixtures,
furniture, merchandise or other property, real or personal, are damaged or
destroyed from any cause covered by a property policy obtained by Tenant, then
and to the extent allowable and without invalidating such insurance, and whether
or not such damage or destruction was caused by the negligence of the other
party, neither party shall have any liability to the other nor to any insurer of
the other for or in respect of such damage or destruction. If obtainable, each
party shall require all policies of fire or other insurance carried by such
party during the Lease Term upon the Premises or contents therein to include a
provision whereby the insurer designated therein shall waive its right of
subrogation against the other party.
8.5 During the entire Lease Term, Tenant, at Tenant's sole cost and expense,
shall procure and maintain in full force and effect personal injury and property
damage liability insurance with a combined single limit of not less than Five
Million Dollars ($5,000,000). Such insurance may be evidenced by a Primary
Policy or a combination of a Primary Policy and an Umbrella Excess Policy.
Tenant's liability insurance shall be primary and any liability insurance
maintained by Landlord shall not be contributory. Landlord shall be named as an
additional insured in such policies, and a policy endorsement so naming Landlord
shall be furnished to Landlord. All such insurance shall insure the performance
by Tenant of the indemnity provisions of Article VII of this Lease. The limits
of said policies shall not limit the liability of Tenant under this Lease. In
the event that either party hereto shall at any time deem the limits of such
liability insurance then carried to be insufficient, the parties shall endeavor
to agree upon the proper and reasonable limits for such insurance then to be
carried. If the parties shall be unable to agree thereon, the proper and
reasonable limits for such insurance then to be carried shall be determined by
an impartial third person knowledgeable of insurance risk matters selected by
the parties, or should they be unable to agree upon a selection by an impartial
third person such third person shall be chosen by the Presiding Judge of the
Superior Court of Los Angeles County upon
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application by either party made after five (5) days written notice to the other
party of the time and place of application. The decision of such impartial third
person as to such limits then to be carried shall be binding upon the parties.
Such insurance shall be carried with the limits as agreed upon or determined
pursuant to this Paragraph until such limits shall again be changed pursuant to
the provisions of this Paragraph. The expenses of such determination shall be
borne equally between Landlord and Tenant.
8.6 All of the insurance provided by Tenant under this Article VIII and all
renewals thereof shall be issued by such good, responsible and standard
companies rated at least A:Class XII in the current edition of Best's Insurance
Guide, and authorized to do business in California. The policy or policies of
insurance provided for in Paragraph 8.1 hereof shall be payable to Landlord, or
jointly to Landlord and Landlord's Lender, and Tenant agrees to endorse any
check to the order of Landlord which might be made payable jointly to Landlord
and Tenant by the insurance company. Tenant agrees to immediately comply with
any request of the insurance carrier providing insurance described in Paragraph
8.1 if the failure to comply therewith will cause cancellation of such
insurance. All policies provided by Tenant shall expressly provide that the
policy shall not be canceled or altered without thirty (30) days' prior written
notice to Landlord. Neither Landlord nor Tenant shall do or permit to be done
anything which will invalidate the insurance policies provided for in this
Article VIII. Upon the issuance or renewal of the liability insurance policy
described in this Article VIII, or upon commencement of the Lease Term if such
policy is then in force or effect, Tenant shall have its insurance carrier
furnish Landlord with a Certificate of said insurance. If requested in writing
by Landlord or Tenant following the occurrence of an event for which insurance
coverage may be afforded under the insurance provided by Landlord or Tenant,
such party shall reproduce and forward to the requesting party a true copy of
any insurance policy described in this Lease and obtained by Landlord or Tenant
(or such relevant portions of such policy as are sufficient to enable the
requesting party to determine the coverage under such policy). Tenant shall
obtain such fire insurance and other insurance on Tenant's machinery, fixtures,
furniture and other property, real or personal, as Tenant deems appropriate, and
with which Landlord shall not otherwise be concerned.
ARTICLE IX
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Repairs and Maintenance
-----------------------
9.1 Landlord shall maintain and repair the foundation, structural components
and floor slab of the Building at its own cost and expense, provided, however,
that if any maintenance or repair work for the foundation, structural components
or floor slab of the Building is required as a result of any negligence or
willful misconduct of Tenant or any of Tenant's agents, employees, shippers,
customers, invitees or contractors, such work shall be at Tenant's sole cost and
expense. To the extent the foundation, structural components or floor slab of
the Building is damaged as a result of any modifications, alterations or
improvements made
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by Tenant or made at the request or direction of Tenant (including, without
limitation, the Tenant Improvements, the use or operation of the freezer unit or
cold storage areas), Tenant shall be responsible for the costs of repairing any
such items. Tenant shall keep all other portions and components of the Premises
(including all interior and exterior areas, portions, systems and equipment) and
including all plumbing, HVAC systems, electrical and lighting systems, ceilings,
exterior walls, plate glass, paved areas, concrete pads, roof structure, roof
membrane, gutters, downspouts, skylights and asphalt in good order, condition
and repair during the Lease Term and any Extended Term. Without limiting the
generality of the foregoing, Tenant shall perform all maintenance detailed in
Paragraphs I (exterior repainting), J (resurfacing paved areas) and K
(mechanical service controls) of the Performance Standards attached hereto as
Exhibit A. Except as otherwise provided in Article XII, in the event any
"Capital Improvement" is required to be made to the Premises, Landlord shall
cause such Capital Improvement to be performed and Tenant shall be responsible
for paying its "Monthly Prorata Share" (as defined herein) of the costs of any
such Capital Improvement. Tenant's "Monthly Prorata Share" of the costs of any
such Capital Improvement shall be determined by amortizing the costs of such
Capital Improvement (at the Lease Interest Rate) over the number of months of
the useful life such Capital Improvement, and Tenant shall pay the resulting
amount (referred to herein as Tenant's "Monthly Prorata Share") monthly, as
additional rent, for each month of the Lease Term (and any Extended Term)
remaining after the completion of such Capital Improvement (but not beyond the
useful life of such Capital Improvement). For the purposes of this Lease, the
term "Capital Improvement" shall mean and refer to any improvement, replacement,
modification, alteration or conversion of the Base Building Improvements or any
component or system of the Base Building Improvements: (i) which is required for
a reason other than the particular nature of Tenant's business or Tenant's
particular use or business operations at the Premises; (ii) which costs in
excess of Fifty Thousand Dollars ($50,000); and (iii) has a useful life in
excess of ten (10) years. At the expiration or sooner termination of the Lease
Term, Tenant shall pay to Landlord a prorata portion of the cost of the next
scheduled repainting, resurfacing and re-roofing of the building located on the
Premises, and Tenant's share of the costs of the next scheduled repainting,
resurfacing and re-roofing shall be determined as follows: (a) With respect to
repainting, the total estimated cost of repainting shall be multiplied by a
fraction, the numerator of which shall be the number of full calendar months
from the date of the last repainting to the expiration or termination date of
the Lease Term, and the denominator of which shall be sixty (60), and the
resulting amount shall be paid by Tenant; (b) With respect to resurfacing, the
total cost of resurfacing shall be multiplied by a fraction, the numerator of
which shall be the number of full calendar months from the date of the last
resurfacing to the expiration or termination date of the Lease Term, and the
denominator of which shall be thirty-six (36), and the resulting amount shall be
paid by Tenant; and (c) with respect to re-roofing, the total estimated cost of
re-roofing shall be multiplied by a fraction, the numerator of which shall be
the lesser of (i) number of full calendar months from the date of the last re-
roofing (or the completion of the original roof, as the case may be) or (ii) the
number of full calendar months from the Commencement Date to the date on which
this Lease expires or is terminated, and the
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denominator of which shall be the estimated full useful life (as determined by
Landlord) of the roof; provided, however, that if throughout the term of the
Lease, Tenant has continually repaired and maintained the Premises as required
under the terms of this Lease, the Performance Standards and the applicable
Exhibits, then the requirement that Tenant pay its prorata portion of such costs
shall be waived. Except to the extent of repairs or maintenance of the
foundation, structural components or floor slab of the Building which are the
responsibility of Landlord under this Paragraph 9.1 and except for Capital
Improvements as provided above, and subject to the provisions of Paragraph 4.2
and Articles XII and XIII, Tenant shall promptly make all necessary repairs and
perform such other required maintenance, interior or exterior, ordinary as well
as extraordinary, as may be required to maintain the Premises in a clean and
orderly condition. Tenant shall provide a regularly scheduled preventative
maintenance program to insure that the roof of the building is kept in good
repair, free of debris, in a watertight condition, and all roof drains shall be
kept fully open at all times to allow for maximum water drainage. Subject to
Paragraph 4.2, Tenant shall promptly replace any portion of the Premises or
system or equipment in the Premises which cannot be fully repaired, regardless
of whether the benefit of such replacement extends beyond the Lease Term or any
Extended Term. Tenant shall maintain the Premises in an orderly, first-class and
fully operative condition. Landlord shall maintain the exterior landscaping for
the Premises in accordance with Landlord's then-prevailing landscape maintenance
standards, and the cost of such landscape maintenance work shall be paid by
Tenant to Landlord as additional rent. Such payments shall be made by Tenant
within ten (10) days following Tenant's receipt of an invoice from Landlord.
Landlord shall have no obligation to repair or maintain the improvements or any
areas adjacent thereto. Tenant waives the provisions of any law permitting
Tenant to make repairs at Landlord's expense.
9.2 Subject to Paragraph 4.2, all of Tenant's obligations to maintain and
repair the Premises shall be accomplished at Tenant's sole expense. If Tenant
fails to maintain and repair the Premises, Landlord may, at its election, notify
Tenant of Tenant's obligation to undertake such repair and maintenance work. If
Tenant fails to commence such work within thirty (30) days of receipt of such
notice Landlord may enter the Premises and perform any such work on behalf of
Tenant. Notwithstanding the foregoing, no notice to Tenant shall be required in
case of emergency, and in the event of an emergency Landlord may enter the
Premises and perform such repair and maintenance on behalf of Tenant. In any
such case, Tenant shall reimburse Landlord for all costs so incurred immediately
upon demand, together with interest thereon at the "Lease Interest Rate" (as
defined in Paragraph 26.26, below). Landlord's right to perform maintenance and
repair work pursuant to this Paragraph 9.2 shall not be deemed to create any
obligation on the part of Landlord to do so, and shall not in any way limit
Landlord's remedies under this Lease. Any design or construction work
undertaken by or at the direction of Tenant which affects the Premises or any
improvements located on the Premises (including, without limitation, any repair
work, maintenance work, tenant improvement work or restoration work) shall be
performed by duly qualified and properly licensed and insured design
professionals or contractors (as
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the case may be) reasonably satisfactory to Landlord. Tenant shall submit the
names of any such design professionals and contractors to Landlord prior to the
commencement of any construction work on the Premises. If Landlord, acting
reasonably and in good faith, disapproves of any design professional or
contractor selected by Tenant, Tenant shall select a new design professional or
contractor reasonably satisfactory to Landlord.
9.3 Upon the expiration or sooner termination of this Lease, Tenant shall
surrender the Premises to Landlord, broom clean and in the same condition as
received: (a) except for ordinary wear and tear and fire, casualty and
condemnation losses which Tenant is not otherwise obligated to remedy under any
provision of this Lease; (b) except for repair and maintenance items which are
specifically identified as the obligation of Landlord pursuant to Paragraph 9.1,
above; and (c) except as otherwise specifically provided herein. Tenant shall
also be responsible for restoring to Landlord's standard building specifications
(as described in Schedule C-1 of the Work Letter Agreement), any alterations
made or requested by Tenant which cause the Building to deviate from such
standard building specifications, including, without limitation, restoring the
twenty-three (23) truck loading positions constructed at a 38 inch dock height
to Landlord's standard 48 inch dock height and Landlord's standard engineered
slope, removing additional floor drains requested by Tenant, restoring any
sawcut or trenched portions of the floor slab, restoring floor areas in
refrigerated areas and freezer locations, restoring screening wall, gate and
associated landscaping to Landlord's original design. Any damage to, or
deterioration of, the Premises shall be deemed not to be ordinary wear and tear
if the same could have been prevented by good maintenance practices. Upon the
expiration or sooner termination of this Lease, Landlord may require Tenant to
remove any alterations, additions or improvements made to the Premises by or at
the direction of Tenant (whether or not made with Landlord's consent) and to
restore the Premises to its original Landlord specification condition, or
Landlord may perform such removals and restorations itself, all at Tenant's
expense. All alterations, additions and improvements which Landlord has not
required Tenant to remove (or for which Tenant had the election to remove and
elected not to remove), shall become Landlord's property and shall be
surrendered to Landlord upon the expiration or sooner termination of the Lease.
If Tenant so desires, Tenant may, prior to making any additions, alterations,
changes or improvements to the Premises (regardless of whether Landlord's
consent to such additions, alterations, change or improvements is required),
request Landlord to notify Tenant as to whether Landlord will require the
removal of such items and restoration of the Premises to the condition which
existed prior to the performance of any such additions, alterations, changes or
improvements. Any such items for which Landlord so notifies Tenant, writing,
that Landlord will not require to be removed are referred to herein as "Exempt
Alterations." If Landlord has initially indicated to Tenant that Landlord will
require removal of an alteration, addition or improvement, but Landlord
subsequently determines that it will not require removal and so advises Tenant,
then Tenant shall not (unless it has already done so) remove such alteration,
addition or improvement. Except for building service equipment (as defined
below), Tenant may remove any of Tenant's machinery or
-18-
equipment so long as Tenant repairs any damage resulting from the installation
or removal of such machinery or equipment to Landlord's satisfaction. If Tenant
fails to complete its removal and restoration obligations as provided herein as
of the expiration or sooner termination of this Lease, Tenant shall pay holdover
rent (as provided in Paragraph 25.1, below) and items designated in this Lease
as additional rent until such removal and restoration obligations have been
completed. If, whether in violation of this Lease or pursuant to Landlord's
permission (which may be granted or withheld in Landlord's sole and absolute
discretion), Tenant installs any "Underground Storage Tanks" (as defined herein)
on the Premises, Tenant shall, at its sole cost and expense, remove any such
Underground Storage Tanks immediately upon the request of Landlord, the
expiration or sooner termination of this Lease, or the order of any governmental
authority, whichever occurs first. Notwithstanding any provisions of this Lease
to the contrary, such Underground Storage Tanks shall at all times be and remain
the property of Tenant. As used herein, the term "Underground Storage Tank"
means any one or combination of tanks, including all pipes, sumps, valves and
other equipment connected thereto, which are used for the storage of petroleum
products, hydrocarbon substances or fractions thereof, or other Hazardous
Materials, and which are located wholly or partially beneath the surface of the
ground.
9.4 Tenant shall not, without the prior written approval of Landlord, make
any additions, alterations, changes or improvements to the Premises or any
portion thereof which (i) affect any structural component of the Building; (ii)
affect the roof of Building; (iii) affect the exterior appearance of the
Premises; or (iv) adversely affect the function or capacity of any plumbing,
electrical, HVAC, or life safety systems serving the Premises; (v) change the
number or location of any loading doors or man doors located on any exterior
wall of the Building; or (vi) cost in excess of Fifteen Thousand Dollars
($15,000) for any group of improvements being undertaken at one time or
undertaken as part of a related group of improvements. The items enumerated in
items (i) through (v), above, are referred to herein as the "Critical
Components". Any request for approval of any such additions, alterations,
changes or improvements for which Landlord's consent is required shall be
presented to Landlord in writing, accompanied by detailed drawings and
specifications. If Landlord's consent is required for an addition, alteration,
change or improvement to the Premises or any portion thereof and Landlord does
not notify Tenant in writing of Landlord's approval or disapproval within thirty
(30) days following Landlord's receipt of Tenant's request for approval (which
request shall be accompanied by detailed drawings and specifications as provided
herein), then Landlord shall be deemed to have approved the proposed addition,
alteration, change or improvement. Tenant shall not be required to obtain
Landlord's prior consent for any cosmetic alterations to the interior of the
Premises (e.g., wall coverings, floor coverings, and interior painting) with a
cost of less than Fifteen Thousand Dollars ($15,000), but Tenant shall provide
Landlord with at least ten (10) days prior written notice of any such
alterations in order to provide Landlord with an opportunity to post and record
appropriate notices of non-responsibility. All approved additions, alterations,
changes and improvements shall be made in workmanlike manner, in full compliance
with all laws and ordinances applicable thereto. All such
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additions, alterations, changes and improvements shall become a part of the
Premises, and become the property of Landlord when installed; and, unless
Landlord shall require removal thereof as required pursuant to Paragraph 16.2,
all such improvements, including all "building service equipment" improvements
shall remain in and be surrendered as a part of the Premises upon the expiration
or sooner termination of this Lease. If requested by Landlord with respect to
any alterations affecting Critical Components, Tenant shall furnish Landlord
with a set of "as built" drawings which accurately set forth the nature and
extent of improvements made by Tenant to the Premises. Tenant and any assignee
or sublessee of Tenant shall obtain Landlord's prior written consent (which
consent shall not be unreasonably withheld or delayed) before any signs are
installed on the Premises. Such signs shall remain the property of Tenant or any
assignee or sublessee who installs the same and they shall be removed from the
Premises at the expiration or sooner termination of the Lease Term. Any damage
arising out of or resulting from the installation, placement or removal of such
signs (other than discoloration of the Building exterior under such signs) shall
be repaired by Tenant at Tenant's sole cost and expense. The term "building
service equipment" shall include, heaters, air conditioners, solar panels, power
panels, transformers, light fixtures, sprinklers, suspended ceilings, plumbing
fixtures, walls, cabinets, shelving affixed to walls in office areas, doors,
floor coverings, fixtures, (other than Tenant's trade fixtures), fencing, paging
systems, emission or pollution control facilities, security and alarm system
wiring, dock levelers, and utility services such as gas, electricity, water,
steam, telephone, sewer and other similar services used in connection with the
foregoing items. Building service equipment shall also include any related power
installations, plumbing installations, pollution control installations,
sprinkler installations, energy conservation installations, and security
installations, including wiring, conduits, ducts, lines, pipes and meters for
the transportation, distribution, measuring and/or disposal thereof. Building
service equipment shall also include installations affixed to the Building which
serve machinery and equipment, including, without limitation, air lines,
conveyors, crane ways, dust collectors, paint booths, xxxx ducting, power panels
and related power installations. "Building service equipment" shall not include
any conveyor systems, Refrigeration Equipment, Communications Equipment, racking
systems and dock seals installed by Tenant and paid for with Tenant's funds.
9.5 Tenant shall have the right, without Landlord's prior approval, to
install within the Premises Tenant's equipment, trade fixtures, furniture and
furnishings (hereinafter collectively called "Tenant's Equipment"). Tenant
shall have the right to remove any Tenant's Equipment installed by Tenant and
paid for with Tenant's funds so long as Tenant repairs any damage to the
Premises resulting from the installation or removal of such Tenant's Equipment.
Under no circumstances, however, shall Underground Storage Tanks be installed on
the Premises. Tenant shall notify Landlord in writing and Tenant shall obtain
Landlord's prior written approval before the installation of heavy (greater than
1000 psi) equipment, or heavy trade fixtures in the Premises, and prior to
placing any load on the roof or attaching any load to the walls or the underside
of the roof of any building. Tenant shall not install any of Tenant's
-20-
Equipment in such manner to weaken the structural strength of the improvements
on the Premises, interfere with, or make inoperable any portion of the Premises
or the building service equipment. If Tenant makes any addition, alteration,
change, or improvement to the Premises described in Paragraph 9.4 without
Landlord's consent, or if Tenant installs any of Tenant's Equipment in violation
of this Paragraph 9.5, then Tenant shall, upon receipt of written notice from
Landlord, promptly remove, replace, or otherwise correct such installations in
such manner as Landlord shall reasonably require and direct, and Tenant shall
reimburse Landlord, on demand and as additional rent, for all architect's,
engineer's and legal fees incurred by Landlord in connection with such
installations. If Tenant or any person with whom Tenant is engaged in business
causes any damage to the Premises or the improvements, structural or otherwise,
Tenant assumes all risk of such damage to any improvements and Tenant shall,
upon demand, promptly repair all such damage to the reasonable satisfaction of
Landlord. Tenant shall promptly repair any damage to the Premises arising from
the installation, use, and removal of Tenant's Equipment; and Tenant shall
restore the Premises to a clean and orderly condition and appearance, state of
repair and operating order with all remaining improvements thereon in a good,
safe, fully operable condition and in full compliance with all federal, state
and local laws, rules, regulations and ordinances. If Tenant fails to perform
any act or obligation required of Tenant under this Paragraph 9.5, Landlord
shall have the right, but not the obligation, after ten (10) days' written
notice to Tenant specifying the action required by Tenant, to enter upon the
Premises and perform such act or obligation. In that event, Tenant agrees to pay
Landlord, as additional rent within ten (10) days of receipt of Landlord's
invoice, for all costs incurred by Landlord in performing Tenant's act or
obligation, plus an overhead allowance of fifteen percent (15%) of such cost.
9.6 Landlord shall not be obligated to maintain or to make any
repairs, replacements, or renewals of any kind, nature or description whatsoever
to the Premises or any buildings or improvements thereon, except as specifically
provided in Paragraphs 9.1, 12.1, 13.3 and Exhibit A of this Lease.
9.7 Tenant shall comply with and abide by all federal, state, county,
municipal and other governmental statutes, ordinances, laws, and regulations
affecting the Premises, the improvements thereon, the business to be conducted
therein and thereon by Tenant, or any activity or condition on or in the
Premises. Without limiting the generality of the foregoing, Tenant shall comply
with all environmental laws and laws relating to "Hazardous Materials" (as
defined herein) affecting the Premises, the improvements therein, the business
conducted thereon by Tenant, or any activity or condition on or in the Premises.
However, Tenant shall not be responsible for any costs or expenses for the
removal or remediation of any Hazardous Materials which were located on the
Premises prior to the Commencement Date or which migrate onto the Premises from
an offsite source which is not caused or contributed to by Tenant ("Pre-existing
Condition") and Landlord shall indemnify and hold Tenant harmless from any costs
or expenses for the removal or remediation of any Pre-existing Condition.
Landlord has advised Tenant that the Premises is located in an area which was
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previously used for oil and gas exploration and production. Any oil xxxxx which
were located on the Premises have been abandoned in accordance with procedures
approved by the California Department of Conservation, Division of Oil and Gas.
Although detectable quantities of methane have been found in the subsurface of
the Land, methane has not been detected at the surface of the Land. The
Building has been designed and is being constructed to incorporate a passive
methane gas venting system in compliance with County of Los Angeles
requirements. Tenant shall not be responsible for any costs or liabilities
relating to the control, mitigation or remediation of methane gas or any other
Pre-existing Condition, and the presence of any methane gas on the Premises
shall be treated as a Pre-existing Condition. Any and all Hazardous Materials
and their containers which are brought upon the Premises by, at the direction
of, or with the consent or approval of Tenant shall, at all times, remain the
property of Tenant. Tenant warrants that Tenant's business and all activities
to be performed by Tenant in, on or about the Premises shall comply with such
statutes, ordinances, laws and regulations; and Tenant agrees to change any such
activity or install necessary equipment, safety devices, pollution control
systems, or other installations at any time during the Lease Term to so comply
therewith. Tenant agrees not to commit or permit waste upon the Premises.
9.8 Tenant shall not cause or permit any "Hazardous Material" (as
hereinafter defined) to be brought upon, kept, used, stored, discharged or
released (collectively "used") in or about the Premises during the Lease Term,
without the prior written consent of Landlord. Notwithstanding the foregoing, so
long as Tenant complies with all applicable legal and regulatory requirements
relating to the use, storage, handling and disposal of Hazardous Materials,
Tenant shall be permitted to use and store on the Premises: (i) reasonable
quantities of customary janitorial supplies reasonably necessary to clean and
maintain the Premises; and (ii) packaged products intended for resale to
consumers (e.g., hairspray, household cleaners, automotive products, antifreeze,
transmission fluid and similar automotive products). If Tenant breaches the
prohibitions stated above, or if any Hazardous Material used on the Premises
during the Lease Term results in contamination of the Premises or any adjacent
property, then Tenant shall indemnify, defend and hold Landlord harmless from
any and all claims, judgments, damages, penalties, fines, costs, liabilities or
losses (including, without limitation, diminution in value of the Premises
and/or adjacent property, damages for the loss or restriction on use of the
Premises and/or adjacent property, damages arising from any adverse impact on
marketing of the Premises and/or adjacent property, and sums paid in settlement
of claims, attorneys' fees, consultant fees and expert fees) which arise during
or after the Lease Term or any Extended Term as a result of Hazardous Material
so used. This indemnification of Landlord by Tenant includes, without
limitation, costs incurred in connection with any investigation of site
conditions or any cleanup, remedial, removal or restoration work required by any
federal, state or local governmental agency or political subdivision because of
Hazardous Material present in the soil or ground water on or under the Premises
and/or adjacent property. Without limiting the foregoing, if any Hazardous
Material is used on the Premises during the Lease Term and results in any
contamina-
-22-
tion of the Premises and/or adjacent property, Tenant shall promptly take all
actions at its sole expense as are necessary to return the Premises and/or
adjacent property to the condition existing prior to the use of any such
Hazardous Material on the Premises and/or adjacent property; provided that
Landlord's approval of such actions shall first be obtained, which approval
shall not be unreasonably withheld so long as such actions would not potentially
have any material adverse long-term or short-term effect on the Premises or
adjacent property. As used herein, the term "Hazardous Material" means any
petroleum products or other hydrocarbon substances (and fractions thereof) and
any hazardous or toxic substance, material or waste which is or becomes
regulated by any local governmental authority, the State of California or the
United States Government. Upon expiration or earlier termination of this Lease,
Tenant shall duly execute and deliver to Landlord a certificate (the "Hazardous
Material Certificate") in the form of Exhibit F attached hereto. If, at any time
during the Lease Term or upon the termination or earlier expiration of the
Lease, Landlord reasonably believes that the Premises or any adjacent property
has been contaminated as a result of Hazardous Materials which were used on or
about the Premises during the Lease Term, Landlord may conduct an environmental
audit to evaluate the presence of any Hazardous Materials on the Premises. If
such an audit identifies any Hazardous Material contamination which is the
responsibility of Tenant under this Lease, then in addition to any other
obligations and liabilities of Tenant to Landlord under this Lease, Tenant shall
reimburse Landlord for the cost of such environmental audit. Nothing contained
herein shall be deemed or construed to limit the liability of Tenant to Landlord
hereunder for the breach of any covenant of Tenant under this Paragraph 9.8. The
provisions of this Paragraph 9.8 shall survive the expiration or earlier
termination of this Lease and Tenant's surrender of the Premises to Landlord.
9.9 On or before the fifteenth (15th) day of each calendar year
during the Lease Term (the "Disclosure Dates"), Tenant shall disclose to
Landlord in writing the common and chemical names and the quantities of all
Hazardous Materials which were stored, used or disposed of on the Premises
during the preceding calendar year. Tenant shall immediately notify Landlord of
Tenant's receipt of any notice, citation or other communication received by
Tenant relating to the presence, storage, use or release of any Hazardous
Materials in, on or about the Premises. With respect to the notice required by
this Paragraph 9.9, Tenant shall not be obligated to include in such notice any
customary janitorial supplies reasonably necessary to clean and maintain the
Premises; or (ii) packaged products intended for resale to consumers (e.g.,
hairspray, household cleaners, automotive products, antifreeze, transmission
fluid and similar automotive products), so long as such materials have not been
spilled or accidentally released on the Premises, provided, however, that on
each Disclosure Date Tenant shall provided to Landlord a list of all packaged
products brought upon and stored at the Premises during the preceding calendar
year.
9.10 Landlord shall have the right, but not the duty, to inspect the
Premises at any time to determine whether Tenant is complying with the
requirements of this Lease. If Tenant is not in compliance with the
requirements of the provisions of
-23-
this Lease relating to Hazardous Materials, Landlord shall have the right, but
not the obligation, to immediately enter upon the Premises to remedy any
condition caused by Tenant's failure to comply with the requirements of this
Lease. Landlord shall use reasonable efforts to minimize interference with
Tenant's business as a result of any such entry by Landlord but shall not be
liable for any interference caused thereby.
9.11 Any failure of Tenant to comply with the provisions of Paragraphs
9.7, 9.8 and 9.9 of this Lease shall be a material default under this Lease,
enabling Landlord to exercise any of the remedies set forth in this Lease.
ARTICLE X
---------
Inspection of Premises by Landlord
----------------------------------
10.1 Tenant agrees that Landlord and the authorized representatives
of Landlord shall have the right to enter the Premises at all reasonable times
during usual business hours, after 24 hours notice, or at any time in the case
of an emergency, for the purpose of (a) inspecting same; and (b) making such
repairs or reconstruction to the Premises required by or permitted to be made by
Landlord, and (c) performing any work therein that may be necessary by reason of
Tenant's default under the provisions of this Lease. Landlord shall use
reasonable efforts to minimize disruption to Tenant's business and shall be
accompanied by a representative of Tenant. Nothing herein shall imply any duty
of Landlord to do any work which, under the provisions of this Lease, Tenant is
required to perform 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 work on the Premises, keep and store upon the parking
area of or within the Premises, all necessary materials, tools and equipment.
Landlord shall not in any event be liable for any inconvenience, annoyance,
disturbance, loss of business, or other damage sustained by Tenant while making
such repairs or the performance of any such work on the Premises, or on account
of bringing materials, supplies and equipment into or through the Premises
during the course thereof. In the event Landlord makes any repairs or
maintenance which Tenant has failed to do or perform, the cost thereof plus an
overhead allowance of fifteen percent (15%) of such cost shall constitute
additional rent and shall be paid to Landlord within ten (10) days of receipt of
Landlord's invoice.
10.2 Landlord is hereby given the right during usual business hours
to enter the Premises and to exhibit the same for purposes of sale or mortgage,
and during the last six (6) months of the Lease Term to exhibit the same to any
prospective tenant.
ARTICLE XI
----------
Mechanics' Liens
----------------
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11.1 Tenant covenants and agrees to keep all of the Premises and
every part thereof and all buildings and other improvements thereon free and
clear of and from any and all mechanics', materialmen's and other liens for work
or labor done, services performed, materials, appliances, transportation or
power contributed, used or furnished or to be used in or about the Premises for
or in connection with any operations of Tenant, any alterations, improvements,
repairs or additions, which Tenant may make or permit or cause to be made, or
any work or construction by, for or permitted by Tenant on or about the
Premises; and at all times Tenant shall promptly and fully pay and discharge any
and all claims upon which any such lien may or could be based; and Tenant shall
save and hold Landlord and all of the Premises free and harmless of and from any
and all such liens and claims of liens and suits or other proceedings pertaining
thereto. Tenant, or any subtenant, assignee or other occupant of the Premises
covenants and agrees to give Landlord written notice not less than ten (10) days
in advance of the commencement of any construction, alteration, addition,
improvements or repair to the Premises in order that Landlord may post an
appropriate notice of Landlord's non-responsibility.
11.2 No mechanics' or materialmen's liens or mortgages, deeds of
trust, or other liens of any character whatsoever created or suffered by Tenant
shall in any way or to any extent affect the interest or rights of Landlord in
any buildings or other improvements on the Premises, or attach to or affect
Landlord's title to or rights in the Premises.
11.3 Tenant shall have the right to contest any mechanic's lien or
other lien claim filed against the Premises provided that Tenant gives Landlord
written notice of such contest, Tenant diligently prosecutes such contest, at
all times effectually stays or prevents any official or judicial sale of the
Premises under execution or otherwise, and pays or otherwise satisfies any final
judgment adjudging or enforcing such contested lien and thereafter procures
record satisfaction or release thereof. If requested in writing by Landlord,
Tenant shall furnish to Landlord a surety bond issued by a surety company
acceptable to Landlord in an amount not less than one and one-half times the
amount of any such mechanic's lien or other lien claim filed against the
Premises.
ARTICLE XII
-----------
Damage or Destruction of Premises
---------------------------------
12.1 In the event the buildings or other structures on the Premises
are damaged or destroyed, then so long as the cost of repairing such damage or
destruction is fully covered by insurance policies carried by the Landlord
(except for deductible amounts, which shall be paid by Tenant), Landlord shall
promptly repair and restore the improvements then owned by Landlord (but not any
of Tenant's trade fixtures, furnishings or equipment) to their condition
existing prior to said damage or destruction, and this Lease shall continue in
full force and effect. Any damage or destruction of the type described above is
referred to herein as an "Insured Loss." The
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proceeds of insurance maintained pursuant to Paragraph 8.1 shall be used to pay
the cost and expense of repairing and rebuilding the Premises.
12.2 In the event the Building is damaged or destroyed, and the cost
of repairing such damage or destruction is not fully covered by insurance
policies carried by Landlord (an "Uninsured Loss"), then so long as the portion
of the cost of repairing such damage or destruction which is not covered by the
insurance policies carried by Landlord does not exceed Five Hundred Thousand
Dollars ($500,000) (the "Cap Amount"), then Landlord shall promptly repair such
damage or destruction to the Building and Landlord and Tenant shall each
contribute one-half of the portion of the cost of repairing such damage or
destruction which is not covered by the insurance policies carried by Landlord
(up to a maximum contribution amount of Two Hundred Fifty Thousand Dollars
($250,000) each for Landlord and Tenant). Landlord shall repair and restore the
improvements then owned by Landlord (but not any of Tenant's trade fixtures,
furnishings or equipment) to their condition existing prior to said damage or
destruction, and this Lease shall continue in full force and effect. In the
event of an Uninsured Loss in which the portion of the cost of repairing such
damage or destruction which is not covered by insurance policies carried by
Landlord exceeds the Cap Amount, Landlord and Tenant shall each have the right
to terminate this Lease upon thirty (30) days written notice to the other.
However, if a party has elected to terminate this Lease pursuant to this
Paragraph 12.2, the other party may prevent termination of the Lease pursuant to
this Paragraph 12.2 by paying (in addition to the non-terminating party's share
of the Cap Amount) the entire amount by which the cost of repairing such
Uninsured Loss exceeds the Cap Amount.
12.3 The Minimum Rent payable by Tenant pursuant to the provisions of
Paragraph 4.1 shall xxxxx, in the proportion that the part of the Premises
rendered unusable to Tenant bears to the whole thereof, from the date of the
damage or destruction through the time required by Landlord to repair and
rebuild the Premises, but only to the extent to which Landlord receives
reimbursement for such abatement pursuant to the rental value insurance
maintained under Paragraph 8.1 of this Lease. Except for abatement of such
Minimum Rent, if any, Tenant shall have no claim against Landlord by reason of
any damage, destruction, repair or rebuilding of the Premises.
12.4 Upon the occurrence of any damage or destruction to the
Building, Landlord shall, within twenty (20) days following the date of
occurrence of such damage or destruction, provide to Tenant a written notice of
Landlord's reasonable and good faith estimate of the time required to complete
the repair and restoration ("Landlord's Time Estimate"). If Landlord reasonably
estimates that such repair and restoration will take more than two hundred
seventy (270) days to complete (measured from the date of issuance of necessary
building permits for the repair and restoration work) either Landlord or Tenant
may elect to terminate this Lease (effective as of the date of such damage or
destruction) upon written notice to the other, which notice shall be given, if
at all, within ten (10) days following the date of Tenant's receipt of
Landlord's Time Estimate. Landlord agrees that it shall use diligent efforts to
obtain the necessary
-26-
building permits at the earliest possible date. Once such notice has been
delivered and the ten (10) day response period has expired, neither party shall
have the right to terminate this Lease as a result of the occurrence of such
damage or destruction, regardless of the actual time necessary to complete such
repair and restoration work, but Landlord agrees that it shall use its
reasonable best efforts to complete the restoration work in a timely manner.
12.5 If the Premises are damaged or destroyed, either partially or
totally, during the last year of the Lease Term, Landlord may at Landlord's
option cancel and terminate this Lease as of the date of occurrence of such
damage by giving written notice to Tenant of Landlord's election to do so within
thirty (30) days after the date of occurrence of such damage. However, if Tenant
possesses an option to extend the Lease Term and the time within which Tenant
may exercise such option has not expired, and if Tenant validly exercises such
option within twenty (20) days after Tenant's receipt of the Damage Notice, then
Landlord's election to terminate this Lease pursuant to this Paragraph 12.5
shall be void and of no effect. In such event, the repair and restoration of the
Premises shall be governed by the other applicable provisions of this Article
XII.
12.6 Tenant waives the provisions of any statutes which relate to
termination of leases when the Premises are destroyed; and Tenant agrees that
such event shall be governed by the terms of this Lease and not by any such
statute.
ARTICLE XIII
------------
Condemnation
------------
13.1 If title to all or any portion of the Premises shall be taken by
any public or quasi-public use or authority under any statute or by right of
eminent domain, or by private purchase in lieu thereof, then the rights of the
parties to share in the condemnation award or purchase price thereby resulting
shall be governed by the provisions of this Article XIII.
13.2 Should all or such portion of the Premises be taken in such a
manner as to materially interfere with Tenant's use and occupancy thereof, then
this Lease shall terminate as of the date that possession of said Premises or
part thereof shall be taken. Landlord shall be entitled to (a) any amount paid
for the taking of Landlord's fee interest in the Premises, (b) any severance
damages included in the award, (c) any amount paid for the taking of the
Premises except that paid for any improvements made to the Premises by Tenant
which remain the property of Tenant, and (d) any amount which represents the
present worth of rent payments to be made in the future under the provisions of
this Lease; and none of Landlord's interests in the above shall be subject to
any diminution or apportionment whatsoever. Tenant shall be entitled to
compensation paid under condemnation for the taking of any improvements made to
the Premises by Tenant which remain the property of Tenant.
-27-
13.3 In the event of a partial taking of the Premises which does not
materially interfere with Tenant's continued use and occupancy of the Premises
and the parking and common areas serving the Premises, and there remains
sufficient of the Premises for the continued use of Tenant, then this Lease
shall terminate only as to the part so taken, as of the date that possession of
such part of the Premises is taken, and the Minimum Rent herein provided for
shall be reduced to reflect the same proportion as the fair market rental value
of the Premises after the taking bears to the fair market rental value before
the taking. In the event of a partial taking, Landlord agrees to replace or
repair the building facility constituting a portion of the Premises to its
condition as existed when the Lease Term commenced, and without regard to
improvements made by Tenant, by reinstalling plumbing, electrical, wiring, walls
and paving, if necessary, so that said building facility shall be completely
operable and an integral whole, but at a cost to Landlord not to exceed the
condemnation award received by Landlord. In the event of such partial taking,
Landlord shall be entitled to receive all amounts described in the second
sentence of Paragraph 13.2; and none of Landlord's interest in the above shall
be subject to any diminution or apportionment whatsoever. Tenant shall be
entitled to compensation paid under condemnation for the taking of any
improvements made to the Premises by Tenant which remain the property of Tenant.
13.4 Landlord and Tenant agree to execute all documents and
assignments necessary to carry out this Article XIII in the event of
condemnation or purchase in lieu thereof.
ARTICLE XIV
-----------
Use Of Premises - Assignments
-----------------------------
14.1 Tenant shall have the right to use the Premises for home grocery
distribution, warehousing, general distribution, general office purposes and
similar uses so long as such similar uses are compatible with the uses of
buildings of comparable quality owned by Landlord which are located in Xxxxxxxxx
Technology Center, so long as such uses (i) are in compliance with all
applicable laws and regulations, including, without limitation, environmental
laws and laws relating to Hazardous Materials; (ii) are permitted under the
recorded covenants, conditions and restrictions affecting Xxxxxxxxx Technology
Center; and (iii) are consistent with the requirements of the Performance
Standards. Landlord agrees that, from and after the date of this Lease, and
continuing through the expiration or sooner termination of the Lease Term
(including any validly exercised Extended Term) Landlord shall not enter into
any agreements, covenants or restrictions affecting the Premises which would
prevent Tenant from using the Premises as provided above. Tenant shall not use
the Premises for on-site retail sale of property or for any other use not
permitted pursuant to this Paragraph 14.1; provided, however, that to the extent
legally necessary to enable Tenant to sell for off-site distribution alcoholic
beverages as part of its retail home
-28-
grocery distribution business, Tenant may operate an on-site store for the
retail sale of alcoholic beverages, of a size and capacity not larger than the
minimum reasonably necessary to qualify for the license needed for the sale for
off-site delivery of alcoholic beverages as part of Tenant's home grocery retail
sale and distribution business. Tenant agrees that it shall not have any
displays, exterior signage, advertising or other promotional materials
identifying or promoting such on-site store for the sale of alcoholic beverages.
Tenant shall not conduct nor permit to be conducted any auction or auction sale
at the Premises. Tenant's use of the Premises is subject to limitations imposed
by the Performance Standards and the limitations contained in this Lease. Tenant
covenants and agrees that it shall not permit any of its employees, agents,
contractors, vendors or shippers to park trucks, automobiles, trailers or other
vehicles on any of the public streets in the general vicinity of the Premises or
elsewhere within Xxxxxxxxx Technology Center. Any violation of this restriction
shall constitute a default under this Lease.
14.2 Tenant shall not assign, sublet or otherwise transfer this Lease,
or Tenant's interest in and to the Premises, nor enter into any license or
concession agreements with respect thereto, without first procuring the written
consent of Landlord. Any such attempted or purported assignment, subletting,
transfer, or license or concession agreement (collectively "Transfer") without
Landlord's prior written consent shall be void and of no force and effect, and
shall not confer any interest or estate in the purported transferee (the
"Transferee") and shall, at Landlord's option, constitute an incurable default
under this Lease. Tenant shall have no right to mortgage, hypothecate or
otherwise encumber its leasehold estate in the Premises or its rights under this
Lease, and Landlord and Tenant specifically agree that any such mortgage,
hypothecation or encumbrance by Tenant is strictly and absolutely prohibited. If
Tenant is a corporation, unincorporated association, trust or partnership, the
sale, assignment, transfer or hypothecation of any stock or other ownership
interest of such entity which from time to time in the aggregate exceeds twenty-
five percent (25%) shall be deemed an assignment subject to the provisions of
this Article XIV, but a public offering of Tenant's stock, or the sale of
Tenant's stock on a recognized stock exchange shall not be deemed a "Transfer"
requiring Landlord's consent. Landlord agrees that, in the event of a proposed
Transfer to an "Affiliate" (as defined herein), Landlord will not withhold its
consent to such Transfer so long as (i) such Affiliate's use of the Premises is
in conformance with Paragraph 14.1; (ii) such Affiliate's use of the Premises
will not result in any material increase in the potential risk to Landlord
arising out of or relating to Hazardous Materials; and (iii) such Transfer will
not cause any portion of the amounts received by Landlord pursuant to this Lease
or any sublease to fail to qualify as "rents from real property" within the
meaning of Section 856(d) of the Internal Revenue Code, or which could cause any
other income received by Landlord to fail to qualify as income described in
Section 856(c)(2) of the Internal Revenue Code. As used herein, the term
"Affiliate" shall mean (a) a subsidiary, affiliate, division or corporation
controlling, controlled by or under common control with Tenant; (b) a successor
corporation related to Tenant by merger, consolidation, nonbankruptcy
reorganization, or government action; or (c) a purchaser of substantially all of
Tenant's
-29-
assets located in the Premises. The sale or transfer of Tenant's capital stock
shall not be deemed an assignment, subletting, or any other transfer of the
Lease or the Premises unless such sale or transfer of stock or other ownership
interest of Tenant which is made with the purpose or has the practical effect of
circumventing the Transfer restrictions imposed under this Article XIV. The
consent of Landlord required hereunder shall not be unreasonably withheld;
however, a condition precedent to any consent to a Transfer shall be Tenant's
agreement to pay to Landlord as rent any reasonable costs and expenses incurred
by Landlord for review and consultation by Landlord's legal counsel, securing
credit reports, administrative overhead and the like not to exceed $2,000.00 in
connection with any one assignment or subletting. Notwithstanding the foregoing,
Landlord and Tenant agree that, in determining whether to reasonably consent to
a proposed transfer, Landlord may consider, among other things, any or all of
the following factors:
14.2.1 The reputation of the Transferee (including any
principals, partners or shareholders of such assignee, subtenant to Transferee),
including, without limitation, the Transferee's reputation for dishonesty,
criminal conduct or unethical business practices;
14.2.2 The financial capacity of the proposed Transferee to
perform its obligations under the sublease or assignment in question;
14.2.3 The credit history of the proposed Transferee;
14.2.4 The intended use of the Premises by the proposed
Transferee, and Landlord's assessment of the impact of such use upon the
Premises and neighboring properties;
14.2.5 Whether the proposed Transferee's use of the Premises
will involve the generation, storage, use, treatment or disposal of any
Hazardous Materials in any manner which would increase any potential risk or
liability to Landlord arising out of or relating to Hazardous Materials over the
level of risk associated with Tenant's original use of the Premises.
14.3 Notwithstanding any permitted Transfer, Tenant shall at all times
remain directly, primarily and fully responsible and liable for the payment of
rent and for compliance with all obligations under the terms, provisions and
covenants of this Lease. All Transfer agreements shall expressly provide that,
in the event of a default by Tenant under this Lease, the Transferee covenants
and agrees with Landlord, contemporaneously with receipt of written notice from
Landlord that Tenant is in default of this Lease, and for so long as such
default continues, but not for a period of time in excess of the term of the
Transfer, to accept Landlord as Landlord of Transferee, to attorn to Landlord as
Landlord, to thereafter perform all duties and responsibilities under the
Transfer agreement directly to Landlord for Landlord's sole benefit, and to cure
any default of Tenant under this Lease. Upon the occurrence of any default by
-30-
Tenant, if the Premises or any part thereof are then sublet, Landlord, in
addition to any other remedies herein provided or provided by law, may at its
option collect directly from such subtenant all rents becoming due to Tenant
under such sublease and apply such rent against any sums due to Landlord from
Tenant hereunder, and no such collection shall be construed to constitute a
novation or release of Tenant from the further performance of Tenant's
obligations under this Lease. Any sale, assignment, transfer or hypothecation of
Tenant's interest under this Lease, and any proposed subletting or occupancy of
the Premises not in compliance with this Article XIV shall be void and shall, at
the option of Landlord exercisable by notice to Tenant, terminate this Lease.
14.4 Should Tenant desire to make a Transfer of the Premises, Tenant
shall give not less than thirty (30) days' prior written notice thereof to
Landlord setting forth the name of the proposed Transferee, the term, use,
rental rate and other relevant particulars of the proposed Transfer, including,
without limitation, evidence satisfactory to Landlord that the proposed
Transferee will not use, store or dispose of any Hazardous Materials in or on
the Premises, and that the proposed Transferee will immediately occupy and
thereafter use the Premises for the entire term of the Lease or the sublease (as
the case may be). Such notice shall be accompanied, in the case of a sublease,
by a copy of the proposed sublease, and in the case of any Transfer, any
documents or financial information Landlord may require in order to make a
determination as to the suitability of the Transferee. If Landlord fails to
respond to Tenant's request to Transfer the Premises within thirty (30) days
following Landlord's receipt of Tenant's request and the information specified
above, Landlord shall be deemed to have consented to such Transfer of the
Premises.
14.5 Landlord shall have the right to condition its consent to any
subletting or assignment upon payment by Tenant to Landlord of fifty percent
(50%) of all "Transfer Consideration" (as defined herein) received or to be
received, directly or indirectly, by Tenant on account of such subletting or
assignment. For the mutual benefit of Landlord and Tenant, Tenant shall use
reasonable and good faith efforts to secure Transfer Consideration from any such
assignee, sublessee or transferee which would be generally equivalent to then-
current market rent, but in no event shall Tenant's monetary obligations to
Landlord, as set forth in this Lease, be reduced. Such Transfer Consideration
shall be paid to Landlord at the same time or times as the same is paid to or
used by Tenant. "Transfer Consideration" shall (i) in the case of a sublease of
all or substantially all of the Premises, the net amount (after deducting the
actual and reasonable amounts incurred by Tenant for attorneys' fees, brokerage
commissions, necessary tenant improvements and other third party costs necessary
to facilitate the sublease transaction) of any consideration paid or given,
directly or indirectly, by the sublessee to Tenant pursuant to the sublease for
the use of the Premises, or any portion thereof, over and above the rent,
however denominated, in this Lease, payable by Tenant to Landlord for the use of
the Premises (or portion thereof), prorating as appropriate the amount payable
by Tenant to Landlord under this Lease if less than all of the Premises is
sublet, and (ii) in the case of a sublease of less than all of
-31-
substantially all of the Premises, or in the case of an assignment of this
Lease, the gross amount of any consideration paid or given, directly or
indirectly, by the assignee to Tenant in exchange for entering into the
assignment. Notwithstanding anything contained in this Lease to the contrary,
Tenant shall not (i) sublet or assign the Premises or this Lease on any basis
such that the rent or other amounts to be paid by the sublessee or assignee
thereunder would be based, in the whole or in part, on the income or profits
derived by the business activities of the sublessee or assignee; or (ii) sublet
or assign the Premises or this Lease in any other manner which would cause any
portion of the amounts received by Landlord pursuant to this Lease or any
sublease to fail to qualify as "rents from real property" within the meaning of
Section 856(d) of the Code, or which could cause any other income received by
Landlord to fail to qualify as income described in Section 856(c)(2) of the
Code.
14.6 If this Lease is assigned to any person or entity pursuant to
the provisions of the "Revised Bankruptcy Act" (Title 11 of the United States
Code; 11 U.S.C. (S)101 et seq.), any and all monies or other consideration
payable or otherwise to be delivered in connection with such assignment shall be
paid or delivered to Landlord, shall be and remain the exclusive property of
Landlord, and shall not constitute property of Tenant or of the estate of Tenant
within the meaning of the Revised Bankruptcy Act. Any and all monies or other
considerations constituting Landlord's property under this Article XIV not paid
or delivered to Landlord shall be held in trust for the benefit of Landlord and
shall be promptly paid or delivered to Landlord. Any person or entity to which
this Lease is assigned pursuant to the provisions of the Revised Bankruptcy Act
shall be deemed without further act or deed to have assumed all of the
obligations arising under this Lease on and after the date of such assignment.
14.7 Landlord shall have the right to sell, transfer, delegate or
assign any of its rights or obligations under this Lease.
ARTICLE XV
----------
Event of Default
----------------
15.1 Tenant shall be in default under this Lease if:
15.1.1 Tenant shall fail to make any payment of Minimum Rent,
any additional rent payable hereunder, or any other monetary obligation required
of Tenant under this Lease (including, without limitation, restoration of any
security deposit as required under this Lease) and such failure shall continue
for five (5) days after Tenant's receipt of written notice from Landlord that
said rent or monetary obligation is due and payable as provided in this Lease
(which notice shall be in lieu of, and not in addition to any notice required
pursuant to California Code of Civil Procedure Sections 1161 or 1161(a), as
amended); or
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15.1.2 Tenant shall neglect or fail to perform or observe any
of the covenants herein contained on Tenant's part to be performed or observed,
and Tenant shall fail to remedy the same within thirty (30) days after Landlord
shall have given to Tenant written notice specifying such neglect or failure
(provided, however, that if the performance or observance of any such covenant
reasonably requires more than thirty (30) days to perform, Tenant shall not be
in default under this Lease as a result of its failure to perform or observe any
such covenant within such thirty (30) day period, so long as Tenant has
commenced the actions necessary to perform or observe such covenant within such
thirty (30) day period, and is diligently pursuing such cure to completion); or
15.1.3 Tenant shall abandon the Premises and such abandonment
shall continue for a period of fourteen (14) consecutive days during which
Minimum Rent for the Premises has remained unpaid; or
15.1.4 Tenant repeatedly fails to comply with the restrictions
contained in Paragraph 14.1 of this Lease prohibiting on-street parking; or
15.1.5 Tenant is the subject of an involuntary bankruptcy
petition, the appointment of a receiver, the attachment of any interest in this
Lease or of Tenant's other assets or the exercise by any third party of any
other remedy with respect to Tenant, Tenant's interest in the Lease or Tenant's
other assets, and the petition, receiver, attachment or other remedy is not
discharged within sixty (60) days.
15.2 In the event of any default by Tenant, and without any further
notice or demand, Landlord shall have the right at Landlord's election, then or
at any time thereafter, to:
15.2.1 Terminate this Lease, which shall terminate Tenant's
right to the use, occupancy and possession of the Premises, and Tenant shall
immediately surrender possession of the Premises to Landlord; or
15.2.2 Re-enter and take possession of the Premises or any part
thereof as provided by law, in which event this Lease shall terminate effective
when Landlord takes possession; or
15.2.3 Continue this Lease in effect and enforce any or all
rights and remedies of Landlord under this Lease, including the right to recover
Minimum Rent, additional rent and charges equivalent to rent (sometimes
collectively referred to herein as "rent") as they become due under this Lease,
for so long as Landlord does not terminate Tenant's right to possession of the
Premises; or
15.2.4 Seek any legal or equitable relief permitted by law.
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15.3 If Landlord terminates this Lease as provided in subparagraphs
15.2.1 or 15.2.2 hereof, Landlord shall have the right to recover from Tenant:
15.3.1 The worth, at the time of the award, of the unpaid rent
that had been earned at the time of termination of this Lease; and
15.3.2 The worth, at the time of the award, of the amount by
which the unpaid rent that would have been earned after the date of termination
of this Lease until the time of award exceeds the amount of the loss of rent
that Tenant proves could have been reasonably avoided; and
15.3.3 The worth, at the time of the award, of the amount by
which the unpaid rent for the balance of the term after the time of award
exceeds the amount of the loss of rent that Tenant proves could have been
reasonably avoided; and
15.3.4 Any other amount necessary to compensate Landlord for
all detriment proximately caused by Tenant's breach or which in the ordinary
course of things would be likely to result therefrom; such as, the cost of
recovering possession of the Premises, expenses of reletting including
attorney's fees and any real estate commissions paid or payable, necessary
repair, restoration, renovation, or alteration of the Premises, and care and
safekeeping of the Premises.
"The worth, at the time of the award," as used in subparagraphs 15.3.1 and
15.3.2 of this paragraph, is to be computed by allowing interest at the Lease
Interest Rate in effect when each installment of rent referred to in said
subparagraphs became payable. "The worth, at the time of the award," as
referred to in subparagraph 15.3.3 of this paragraph, is to be computed by
discounting the amount at the discount rate of the Federal Reserve Bank of San
Francisco at the time of the award, plus one percent (1%).
15.4 If Tenant shall breach this Lease and abandon the Premises, this
Lease shall continue in full force and effect for so long as Landlord does not
terminate Tenant's right to possession of the Premises, and Landlord may enforce
all of its rights and remedies under this Lease, including but not limited to
the right to recover rent and charges equivalent to rent as they become due
under this Lease. For the purposes of this Paragraph 15.4 and Paragraph 15.2,
the following acts by Landlord shall not constitute a termination of Tenant's
right to possession of the Premises: (i) maintenance or preservation of the
Premises, (ii) efforts to relet the Premises, or (iii) the appointment of a
receiver upon initiative of Landlord to protect Landlord's interest under the
Lease.
15.5 In the event Landlord re-enters and takes possession of the
Premises, Landlord may at Landlord's option require Tenant to remove from the
Premises any of Tenant's property located therein. If Tenant fails to do so,
Landlord shall not be responsible for the care or safekeeping thereof and may
remove any of the
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same from the Premises and place the same in storage in a public warehouse at
the cost, expense and risk of Tenant with authority to the warehouseman to sell
the same in the event that Tenant shall fail to pay the costs of transportation
and storage, all in accordance with the rules and regulations applicable to the
operation of a public warehouseman's business. Any refusal by a public
warehouseman to accept personal property located in the Premises upon such
condition shall be conclusive evidence that the same is of no substantial value,
and shall be an unconditional warrant to Landlord for disposing of the same in
any manner Landlord may see fit, and without accountability for any alleged
value thereof. In addition, Landlord may, at Landlord's election, dispose of
said property pursuant to the provisions of Sections 1980 through 1991 of the
California Civil Code. In any and all such cases of re-entry, Landlord may make
any repairs in, to or upon the Premises which may be necessary, desirable or
convenient, and Tenant hereby waives any and all claims for damages which may be
caused or occasioned by such reentry or any of the aforesaid acts of Landlord or
by reason of any loss or destruction or damage to any property in or about the
Premises or any part thereof.
15.6 Tenant further covenants and agrees that if Landlord fails or
neglects for any reason to take advantage of any of the terms hereof provided
for the termination of this Lease or for the termination or forfeiture of the
estate hereby leased, or if Landlord, having the right to declare this Lease
terminated or the estate hereby leased terminated or forfeited, shall fail so to
do, any such failure or neglect of Landlord shall not be or be deemed or be
construed to be a waiver of any provisions for the termination of this Lease
continuing to exist or for the termination or forfeiture of the estate hereby
leased subsequently arising, or as a waiver of any of the covenants, terms or
conditions of this Lease or of the prompt performance thereof by Tenant. None of
the covenants, terms or conditions of this Lease can be waived by conduct of the
parties or by estoppel; any claim or waiver must be in writing and signed by the
party entitled to the benefit thereof.
ARTICLE XVI
-----------
Surrender of Premises
---------------------
16.1 Upon any termination of this Lease, whether by lapse of time,
cancellation pursuant to an election provided for herein, forfeiture, or
otherwise, Tenant shall immediately surrender possession of the Premises and all
buildings and improvements on the same in a good, safe, fully operable
condition, and in full compliance with all Federal, State and local laws, rules,
regulations and ordinances (including, without limitation, any laws, rules,
regulations and ordinances relating to Hazardous Materials) and in compliance
with each applicable provision of this Lease, including without limitation the
provisions of Article IX hereof. If possession is not immediately surrendered,
Landlord may, with process of law, enter the Premises and repossess the same and
expel Tenant or any subtenant or occupant therefrom. Landlord shall hold the
Premises after any such re-entry free of any right, privilege or estate of
Tenant and
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without any duty or obligation to Tenant in respect of any subsequent reletting
or disposition of the Premises. If Tenant's business operations on the Premises
or uses of the Premises involve any generation, storage, use, treatment or
disposal of any Hazardous Material, Tenant shall be responsible for removing any
such Hazardous Materials from the Premises and for decontaminating the Premises
and any neighboring properties affected by such Hazardous Materials.
16.2 Upon the termination of this Lease, Tenant shall have the right
to remove, and if directed so to do by Landlord shall remove, from the Premises,
all of Tenant's machinery, equipment (excluding building service equipment),
trade fixtures, signs, furniture, furnishings, supplies and inventory then
installed or in place in, on or about the Premises. Except as hereinafter
expressly set forth, such removal shall be completed prior to the expiration or
earlier termination of this Lease. Tenant shall make all repairs to the Premises
required because of the installation or removal of such items and Tenant shall
restore the Premises to the condition required pursuant to Article IX and other
applicable provisions of this Lease. If this Lease shall terminate at any time
other than the time herein fixed as the expiration of the Lease Term, and
occurring not due to a default by Tenant, then Tenant, if not in default
hereunder at the time, shall have a reasonable time thereafter to effect the
removal of the foregoing items, not to exceed thirty (30) days. Tenant shall pay
Minimum Rent and items designated in this Lease as additional rent to Landlord
on a per diem basis during the time such removal is taking place.
16.3 If any of Tenant's machinery, equipment, trade fixtures, signs,
furniture, furnishings, supplies and inventory remain on the Premises after the
end of the term hereof or time allowed to remove the same, such property shall
be deemed abandoned by Tenant and it shall become the property of Landlord
without any claim therein of Tenant should Landlord so elect.
16.4 Upon termination of this Lease, Tenant shall surrender the
Premises in a "broom-clean" condition, with all refuse and debris removed
therefrom, and with all electrical, plumbing, heating and air conditioning
installations in a good, safe and fully operable condition, and prior to such
termination, Tenant shall fill or repair any holes or openings made by Tenant in
the walls, roof or floor of the building, remove any protuberance, and perform
any maintenance or repairs required of Tenant by this Lease. Nothing contained
in this Paragraph 16.4 shall be deemed to limit Tenant's repair and maintenance
obligations pursuant to Article IX of this Lease. If directed so to do by
Landlord, Tenant shall also remove any improvements, additions or alterations
made to the Premises by Tenant and thereafter restore the Premises to their
original condition, even though such improvements by the terms of this Lease
become a part of the Premises and the property of Landlord.
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ARTICLE XVII
------------
Delays - Extensions of Time
---------------------------
17.1 The time within which Landlord or Tenant is obligated herein to
construct, repair or rebuild any building, improvement or other structure shall
be extended and the performance excused when the delay is occasioned by the
other party (such as failure to promptly give required approvals, or
installation of machinery and equipment during construction which interferes
with or delays the contractor); or by strikes, threats of strikes or lockouts;
blackouts, war, threats of war, bombing, insurrection, riot or invasion; acts of
God, calamities, civil commotions, violent action of the elements or fire;
action, inaction or delayed action of any governmental agency; regulations or
laws of any national, state or local governmental authority; unavailability of
materials at reasonable prices, delays in delivery of materials by suppliers or
weather conditions which impair or delay construction; or other matters or
things, whether similar or dissimilar to the foregoing, beyond the reasonable
control of the obligated party. Delayed action by a governmental agency shall be
deemed to occur if a grading and foundation only permit is not issued within
twenty-one (21) days after drawings and specifications for such permit are filed
for plan check with the appropriate governmental agency, or if a building permit
is not issued within forty-five (45) days after drawings, specifications, and
engineering calculations for such permit are filed for plan check with such
governmental agency.
ARTICLE XVIII
-------------
Attorneys' Fees
---------------
18.1 In the event that either Landlord or Tenant brings any action or
proceeding against the other for possession of the Premises or for the recovery
of any sum due hereunder, or because of the breach of any covenant, condition or
provision hereof, or for any other relief against the other, declaratory or
otherwise, including appeals therefrom, and whether being an action based upon a
tort or contract, then the prevailing party to this Lease in any such proceeding
shall be paid attorneys' fees and costs of such action or proceeding which shall
be enforceable whether or not such action or proceeding, is prosecuted to final
judgment, and including an allowance for attorneys' fees for appeals and
rehearings. In addition to the foregoing award of attorneys' fees to the
prevailing party, the prevailing party in any such lawsuit shall be entitled to
its attorneys' fees incurred in any post-judgment proceedings to collect or
enforce the judgment. This provision is separate and several and shall survive
the merger of this Lease into any judgment on this Lease. As used here, the
term "attorneys' fees" means the full costs of legal services performed in
connection with the matters involved, calculated on the basis of usual fees
charged by an attorney performing those services, and not limited to "reasonable
attorneys' fees" as defined in any statute or rule of the court.
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ARTICLE XIX
-----------
Statement of Lease
------------------
19.1 Tenant shall, at any time and from time to time during the Lease
Term (or any Extended Term) upon not less than fifteen (15) days' prior written
notice from Landlord, execute, acknowledge and deliver to Landlord a written
certificate substantially in the form attached hereto as Exhibit E, certifying:
(i) that this Lease represents the entire agreement between Landlord and Tenant,
and 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); (ii) the dates to which Minimum Rent and other
charges or additional rent have been paid in advance, if any; (iii) the
Commencement Date and Termination Date of the Lease Term; (iv) whether Tenant
has assigned, subleased or otherwise transferred the Premises, this Lease or any
interest of Tenant therein; (v) the then-current amount of Minimum Rent and any
Security Deposit paid by Tenant to Landlord under this Lease; (vi) the date upon
which, and the amount or method by which, Minimum Rent, additional rent or other
charges payable under this Lease will next be adjusted or increased (if at all);
(vii) that there are no options to extend the term of this Lease, or if any such
options exist, describing any such options and stating the terms and conditions
upon which any such options may be exercised; (viii) that there are no rights of
first refusal to purchase the Premises or lease additional space contiguous to
the Premises, or if any such rights of first refusal exist, stating the terms
and conditions upon which the same may be exercised; (ix) that to the best
knowledge of Tenant, there are not any uncured defaults on the part of Landlord
under this Lease, and that Tenant has no right of offset, counterclaim or
deduction against Minimum Rent or other payment obligations of Tenant under this
Lease, or specifying such defaults if any are claimed together with the amount
of any offset, counterclaim or deduction alleged by Tenant; and (x) that to the
best of Tenant's knowledge, Landlord has fully performed each and all of its
construction, repair and maintenance obligations required to be performed as of
the date of such statement (if any), as required under this Lease, except as may
be specifically set forth in said statement (if applicable), and that Tenant,
subject to any such stated exception(s), accepts the Premises in their present
condition.
19.2 In addition to the certificate required pursuant to Paragraph
19.1, above, Landlord shall have the right to require Tenant to execute a
statement or certificate in a form reasonably requested by an existing or
potential purchaser, lender or other party which may acquire the Premises or
hold a security interest in the Premises (or the real property or Building of
which the Premises are a part), or any other certificate or form as may be
reasonably requested by Landlord, which statement or certificate certifies the
existence of factual matters (but does not change Tenant's rights or obligations
under this Lease).
19.3 Any such certificate or statement referred to in this Article
XIX may be relied upon by any such existing or potential purchaser, lender,
other secured party,
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and Tenant's failure or refusal to execute and deliver such statement within
such time shall, at the option of Landlord, constitute a material default under
this Lease, and in any event, shall be conclusive and binding upon Tenant that:
(a) this Lease is in full force and effect, without modification, except as may
be represented by Landlord; (b) there are no uncured defaults in Landlord's
performance and that Tenant has no right of offset, counterclaim or deduction
against Minimum Rent or other payment obligations under this Lease; and (c) no
more than one (1) months' Minimum Rent or other payment obligations under this
Lease has been paid in advance.
19.4 If Landlord desires to finance, refinance, or sell all or any
portion of the real property of which the Building or the Premises are a part,
Tenant hereby agrees to deliver to any lender or purchaser designated by
Landlord such financial statements and other documents and instruments of Tenant
as may be reasonably required by any such lender or purchaser. Such statements
shall include the last three (3) years' financial statements of Tenant. All such
financial statements and other information shall be received by Landlord and any
such lender or purchaser in confidence (except for disclosures to auditors and
regulatory authorities, and except for other disclosures required by law), and
shall be used only for the purposes herein set forth.
19.5 Tenant acknowledges and agrees that Tenant's obligation to
provide such certificates or statements constitutes a material inducement to
Landlord to execute this Lease, and Tenant shall provide Landlord with such
certificates and statements within fifteen (15) days following Tenant's receipt
of Landlord's written request therefor. Tenant shall be responsible for and
shall indemnify and hold Landlord harmless from any and all liability, loss,
cost, damage and expense, including, without limitation, attorneys' fees, which
Landlord may incur in connection with Tenant's failure or delay in executing,
acknowledging and delivering such certificates or statements, or which may be
incurred as a result of Tenant's breach of any other covenant or agreement
embodied in this Lease that results in the delay, impairment, loss or
cancellation of any transaction, event or occurrence for which such certificates
or statements are requested.
ARTICLE XX
----------
Rights Reserved by Landlord
---------------------------
20.1 Landlord expressly reserves all rights in and with respect to
the land hereby leased not inconsistent with Tenant's use of the Premises as
provided in this Lease, including (without in any way limiting the generality of
the foregoing) all rights to the subsurface of the land more than five (5) feet
below ground level, except where building improvements extend more than five (5)
feet below ground level; and all rights to the airspace more than ten (10) feet
above the roof of any building; and the rights to enter upon the Premises for
itself or to give easements to others for the purpose of installing, using,
maintaining, renewing and replacing such overhead or
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underground water, oil, gas, sewer drainage, and other pipe lines, and
telephone, electric, power, television and other lines, cables and conduits as
Landlord may deem desirable in connection with the development or use of any
other property in the neighborhood of the Premises, whether owned by Landlord or
not, all of which pipelines, lines and conduits shall be buried to a sufficient
depth or raised to a sufficient height so as not to interfere with the use or
stability of the Premises. In exercising any such rights reserved to Landlord,
Landlord shall not unreasonably interfere with Tenant's business operations and
use of the Premises.
ARTICLE XXI
-----------
Covenant of Quiet Enjoyment
---------------------------
21.1 Landlord does hereby covenant, promise and agree to and with
Tenant that Tenant, for so long as it is not in default hereof and is in
compliance with all of the terms and conditions of this Lease, shall and may at
all times peaceable and quietly have, hold, use, occupy and possess the Premises
throughout the term of this Lease, subject to all of the terms and conditions of
this Lease, without any molestation or eviction by Landlord or any persons
claiming by or through Landlord.
ARTICLE XXII
------------
Recordation
-----------
22.1 Neither this Lease nor a short form of memorandum of this Lease
shall be recorded in the office of any county recorder without Landlord's
express written consent. In the event of any such recordation, Tenant shall be
solely responsible for any documentary transfer taxes or other taxes relating to
or arising out of any such recordation.
ARTICLE XXIII
-------------
Subordination
-------------
23.1 This Lease and Tenant's rights hereunder are and will remain
subject and subordinate to any ground lease, mortgage, deed of trust or any
other hypothecation for security now or hereafter placed upon the real property
of which the Premises are a part (the "Property"), and to all increases,
renewals, modifications, consolidations, replacements, and extensions thereof
(collectively referred to as the "Mortgage"). If the holder of a Mortgage
becomes the owner of the Property by reason of foreclosure or acceptance of a
deed in lieu of foreclosure, at such holder's election Tenant will be bound to
such holder or its successor-in-interest under all terms and conditions of this
Lease, and Tenant will be deemed to have attorned to and recognized such holder
or successor as Landlord's successor-in-interest for the remainder of the Lease
Term or any extension thereof. No indemnification obligation of Landlord under
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this Lease shall be assumed by or binding upon any such Mortgage holder. The
foregoing is self-operative and no further instrument of subordination and/or
attornment will be necessary unless required by Landlord or the holder of a
Mortgage, in which case Tenant will, within ten (10) days after written request,
execute and deliver without charge any documents reasonably required by Landlord
or such holder in order to confirm the subordination and attornment set forth
above. Should the holder of a Mortgage request that this Lease and Tenant's
rights hereunder be made superior, rather than subordinate, to the Mortgage,
then Tenant will, within ten (10) days after written request, execute and
deliver without charge such agreement as may be reasonably required by such
holder in order to effectuate and evidence such superiority of the Lease to the
Mortgage. If Landlord has made an assignment of rents and leases to the Mortgage
holder, Tenant agrees to be comply with any provisions of such assignment
requiring the payment of rents to the Mortgage holder.
23.2 If Tenant fails to execute and deliver any documents as and when
required above, such failure will constitute a default under this Lease,
entitling Landlord to the same rights and remedies as if such default were with
respect to non-payment of Minimum Rent. With respect to each Mortgage that may
encumber the Property at or after the commencement of the Lease Term, Landlord
agrees that it shall obtain from the holder of the Mortgage a "non-disturbance
agreement," in the usual form used by such holder, with such changes thereto as
are reasonably satisfactory to Tenant and the holder of any such Mortgage. The
term "non-disturbance agreement" as used herein means, in general, an agreement
that as long as Tenant is not in default under this Lease, this Lease will not
be terminated if such holder acquires title to the Property by reason of
foreclosure proceedings or acceptance of a deed in lieu of foreclosure, provided
that Tenant attorns to such holder in accordance with such holder's
requirements. The non-disturbance agreement shall include substantially the
following provisions:
(i) Tenant shall expressly recognize and agree that the holder
of any such Mortgage or any of their successors or assigns may sell the Premises
in the manner provided for by law or in such Mortgage, but such sale shall be
made subject to the tenancy created by this Lease;
(ii) In the event of the enforcement by the holder of any such
Mortgage of the remedies provided for by law or by such Mortgage, Tenant will,
as a result of such enforcement, automatically become the tenant of any person
succeeding to the interest of Landlord as the result of such enforcement
(collectively, the "Successor") without change in the terms or provisions of
this Lease and such Successor shall succeed to Landlord's interest in the
Premises subject to the terms of this Lease;
(iii) Upon request by Successor, Tenant shall execute and
deliver an instrument or instruments confirming the attornment provided for
herein in a form reasonably acceptable to Landlord, lender and Successor;
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(iv) So long as an Event of Default is not in existence, that
Tenant's use, possession, tenancy, rights, and occupancy hereunder shall remain
undisturbed and shall survive any action taken pursuant to the Mortgage to which
this Lease is subordinated.
(v) Each future mortgagee must and Landlord shall cause any
future mortgagee to enter into a Nondisturbance Agreement on substantially the
same terms set forth above, unless such terms are waived by Tenant.
ARTICLE XXIV
------------
Security Deposit
----------------
24.1 As security for the faithful performance of the terms,
covenants, conditions and provisions of this Lease, as well as to indemnify
Landlord from any damages, costs, expenses, real estate brokerage commissions or
attorneys' fees which Landlord may incur or suffer by reason of any default by
Tenant, Tenant hereby agrees to deposit with Landlord, upon execution of this
Lease, a security deposit in the amount of One Million Eight Hundred Thousand
Dollars ($1,800,000) in the form of either: (a) a cash deposit; or, (b) an
unconditional and irrevocable letter of credit in a form acceptable to Landlord
issued by Bank of America NT&SA (or by another major bank reasonably acceptable
to Landlord and confirmed by Bank of America NT&SA), which letter of credit
shall be renewed annually, at least thirty (30) days prior to the expiry date
thereof for additional one-year periods so that a valid letter of credit remains
in effect until the expiration of the Lease Term. If such letter of credit has
not been renewed at least thirty (30) days prior to the expiry date thereof,
Landlord may immediately draw on such letter of credit and hold the cash
proceeds thereof in lieu of such letter of credit. Any such cash deposit and any
such letter of credit shall constitute the "security deposit" under this Lease.
No interest shall be paid by Landlord to Tenant on the security deposit, and no
trust relationship is created between Landlord and Tenant with respect to the
security deposit. Landlord shall not be required to keep said deposit separate
from its general accounts.
24.2 In the event Tenant shall be in default hereof at any time prior
to the end of the term hereof, then Landlord may apply all or any portion of the
security deposit in payment of Landlord's costs, expenses, damages, real estate
broker's commissions, and attorneys' fees in enforcing the terms, covenants,
conditions and provisions hereof. Nothing herein contained shall be construed to
mean that the recovery of damages by Landlord against Tenant shall be limited to
the sum of the security deposit. In the event any portion or all of the security
deposit is applied by Landlord in accordance with the foregoing, then Tenant
shall immediately deposit with Landlord additional sums so that the security
deposit in the hands of Landlord shall be at all times not less than the sum of
the deposit herein provided for.
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24.3 Should the Lease Term and the occupancy of the Premises by
Tenant fail to commence through no fault of Tenant, then Landlord shall return
the security deposit and any prepaid rent then possessed by Landlord to Tenant
within thirty (30) days after such event occurs. If this Lease should terminate
for any reason other than the default of Tenant, Landlord shall return the
security deposit to Tenant promptly after Landlord's inspection of the Premises
and confirmation that the Premises are surrendered in the condition as required
under the terms of this Lease.
ARTICLE XXV
-----------
Holding Over
------------
25.1 If Tenant remains in possession of the Premises after the
expiration of the Lease Term or any extension or renewal hereof, such holding
over shall not operate to extend or renew this Lease but shall be construed as a
tenancy from month-to-month which may be terminated by Landlord upon three (3)
days' prior written notice if Tenant is then in default of this Lease, or by
either party upon at least thirty (30) days' prior written notice directed to
the end of a calendar month. Such month-to-month tenancy by Tenant shall be
subject to all the terms and provisions of this Lease, except that the Minimum
Rent payable during the period of holding over shall be the greater of: (a)
Minimum Rent set forth in Item 1.6 of the Basic Lease Provisions, plus a
percentage of such rent equal to the percentage change in the CPI between the
Commencement Date of this Lease and the period of holding over; or (b) one
hundred fifty percent (150%) of the average monthly Minimum Rent payable by
Tenant during the last twelve (12) months of the Lease Term or any extension or
renewal thereof. Any options, rights, or privileges granted to Tenant, if any,
to extend the Lease Term, to acquire the Premises, or re-lease the same, shall
not be applicable during said period of holding over.
ARTICLE XXVI
------------
General
-------
26.1 Remedies Cumulative. The specific remedies to which Landlord
-------------------
may resort under the terms of this Lease are cumulative and are not intended to
be exclusive of any other remedies or means of redress to which Landlord may be
lawfully entitled in case of any breach or threatened breach by Tenant of any
provision of this Lease.
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26.2 Successors and Assigns. The covenants and agreements herein
----------------------
contained shall bind and inure to the benefit of Landlord, its successors and
assigns, and Tenant, its successors and assigns, subject to the provisions of
this Lease.
26.3 Payments and Interest. Except as otherwise specifically provided
---------------------
in this Lease, each covenant, agreement or stipulation by a party hereto shall
be performed at such party's own cost and expense, and without cost or expense
to the other party. Any monetary obligations due from Tenant to Landlord which
are not paid when due shall bear interest from the due date until paid to
Landlord at the Lease Interest Rate. Such interest shall be paid at the time of
payment of the principal obligation as a condition of remedy of such principal
obligation. Any check tendered by Tenant which is dishonored by the drawee bank
shall not constitute payment of any obligation under this Lease. If any check
tendered by Tenant is dishonored by the drawee bank, then the checks for all
payment obligations of Tenant under this Lease for the next twelve months shall
be in the form of cashiers' checks drawn on a major bank with offices located
throughout the state of California.
26.4 Late Charge. Tenant acknowledges that late payment of Minimum
-----------
Rent and items designated in this Lease as additional rent will cause Landlord
to incur costs and suffer damages not contemplated by this Lease, the exact
amount of which will be impracticable to ascertain. Such costs and damages
include, but are not limited to, late charges which may be imposed on Landlord
by the terms of any trust deed covering the Premises; additional administrative
duties of Landlord's personnel in determining delinquent rents and attempts to
collect such rents by reasonable means other than litigation; additional
accounting and budgetary duties of Landlord's personnel; possible adverse
effects on Landlord's credit rating resulting from impairment of Landlord's cash
flow; and attorneys' fees resulting from consultations with counsel.
Accordingly, if any installment of Minimum Rent or items designated as
additional rent are not received by Landlord within ten (10) days after the same
are due, Tenant shall pay Landlord, as additional rent, a late charge equal to
five percent (5%) of such overdue amount. Landlord and Tenant agree that such
late charge represents a fair, equitable, and reasonable estimate of the costs
and damages Landlord will incur because of Tenant's late payment.
26.5 Late Payments and Impounds. In the event that a late charge is
--------------------------
payable pursuant to Paragraph 26.4, whether or not collected, for two (2)
consecutive installments of rent, then (i) rent shall automatically become due
and payable quarterly in advance, rather than monthly, notwithstanding Paragraph
4.1 or any other provision of this Lease to the contrary; (ii) if requested by
Landlord, Tenant shall furnish to Landlord Tenant's latest financial statements
covering at least the past two fiscal years and any interim statements covering
the current fiscal year; and (iii) Tenant shall pay to Landlord, if Landlord
shall so request, in addition to any other payments required under this Lease, a
quarterly advance installment payable at the same time as the quarterly rent, as
estimated by Landlord, for real property taxes and insurance expenses on the
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Premises which are payable by Tenant to Landlord under the terms of this Lease.
Such fund shall be established to insure payment when due, before delinquency,
of any or all such real property taxes and insurance premiums. If the amounts
paid to Landlord by Tenant under the provisions of this Paragraph are
insufficient to discharge the obligations of Tenant to pay such real property
taxes and insurance premiums as the same become due, Tenant shall pay to
Landlord, upon Landlord's demand, such additional sums necessary to pay such
obligations. All monies paid to Landlord under this Paragraph may be
intermingled with other monies of Landlord and shall not bear interest. In the
event of a default in the obligations of Tenant to perform under this Lease,
then any balance remaining from funds paid to Landlord under the provisions of
this Paragraph may, at the option of Landlord, be applied to the payment of any
monetary default of Tenant in lieu of being applied to the payment of real
property tax and insurance premiums. All advance payments provided for in this
Paragraph shall be deemed rent under this Lease.
26.6 Notices. Any notice or demand required or permitted by law or
-------
by any of the provisions of this Lease shall be in writing. All notices or
demands by either party shall be deemed to have been properly given upon
delivery when served personally; two (2) business days after being deposited
with the U.S. Postal Service when sent by registered or certified mail, postage
prepaid; or by noon on the business day following the day of deposit with an
overnight express carrier when sent by overnight express service, such as
Federal Express. Notices from Landlord to Tenant shall be given to Tenant at the
address set forth in Item 1.12 of the Basic Lease Provisions. Notices or demands
to Landlord shall be given to Landlord at 00000 Xxxxxxxxxx Xxxxxx, Xxxxx 000,
Xxxxxx, Xxxxxxxxxx 00000. Either party hereto may change the place to which
notices are to be given by advising the other party in writing.
26.7 Captions. The headings or captions of Articles in this Lease
--------
are for convenience and reference only, and they in no way define, limit or
describe the scope or intent of this Lease or the provisions of such Articles.
26.8 Pronouns and Singular/Plural. Feminine or neuter pronouns shall
----------------------------
be substituted for those masculine form or vice versa, and the plural shall be
substituted for the singular number of vice versa, in the place or places herein
where the context may require such substitution or substitutions.
26.9 Time of Essence. Time is hereby declared to be of the essence
---------------
of this Lease and of each and every covenant, term, condition or provision
hereof.
26.10 Reasonable Consent. Except as otherwise specifically provided
------------------
in this Lease, whenever the Lease requires an approval, consent, designation,
determination or judgment by either Landlord or Tenant, such approval, consent,
designation, determination or judgment (including, without limiting the
generality of the foregoing, those required in connection with assignment and
subletting) shall not be
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unreasonably withheld or delayed and in exercising any right or remedy
hereunder, each party shall at all times act reasonably and in good faith.
26.11 Fair Meaning. The language in all parts of this Lease shall be
------------
in all cases construed as a whole according to its fair meaning, and not
strictly for nor against either Landlord or Tenant.
26.12 Entire Agreement. This Lease contains all of the agreements of
----------------
the parties hereto with respect to any matter covered or mentioned in this
Lease, and no prior agreement or understanding pertaining to any such matter
shall be effective for any purpose. No provision of this Lease may be amended or
added to except by an agreement in writing signed by the parties hereto or their
respective successors in interest.
26.13 No Accord and Satisfaction. No payment by Tenant or receipt by
--------------------------
Landlord of a lesser amount than that stipulated herein for Minimum Rent,
additional rent or any other charge shall be deemed to be other than on account
of the earliest stipulated Minimum Rent, additional rent or other charge then
due, nor shall any endorsement or statement on a check or letter accompanying
any check or payment be deemed an accord and satisfaction, and Landlord may
accept such check or payment without prejudice to rights to recover the balance
of such Minimum Rent, additional rent, or other charges or pursue any other
remedy in this Lease, at law or in equity.
26.14 Choice of Law. This Lease shall be governed by and construed
-------------
pursuant to the laws of the State of California.
26.15 [Intentionally deleted.]
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26.16 Counterparts. This Lease may be executed in several
------------
counterparts, each of which shall constitute an original.
26.17 Corporate Resolution. If Tenant is a corporation, Tenant shall
--------------------
deliver to Landlord, contemporaneously with delivery of this Lease executed by
Tenant, a certified copy of a resolution of Tenant's Board of Directors
authorizing the execution of this Lease and naming the representatives
authorized to execute this Lease on behalf of Tenant.
26.18 Reimbursements to Landlord. If Tenant, or any third party on
--------------------------
behalf of Tenant or with whom Tenant is engaged or contemplates engaging in
business, requests that Landlord review or approve any drawings, specifications
or engineering calculations respecting any improvements Tenant intends to
install in the Premises or execute any agreement or written instrument; and if
Landlord refers such matter to any architect, engineer, surveyor or other
professional or administrative personnel of Landlord or to legal counsel for
review and advice to Landlord, then Tenant agrees to reimburse Landlord as
additional rent for all professional fees and costs incurred by Landlord at the
actual cost thereof for persons not in the direct employ of Landlord, and at the
rate of Seventy-Five Dollars ($75.00) per hour for all time spent by
professional and administrative persons in the direct employ of Landlord. If
Tenant requests that Landlord consent to an assumption and/or assignment of this
Lease or a subletting of the Premises to a third party for which Landlord's
written consent is required, Tenant agrees to reimburse Landlord, as additional
rent, for all time spent by Landlord's administrative and professional
personnel, in reviewing the proposed form of all legal documents submitted by
Tenant and preparing necessary additional legal documents, in evaluating the
investigating the credit worthiness of the proposed assignee or subtenant, in
inspecting the Premises to determine if the same is in the condition and state
of repair as required by this Lease, in reviewing drawings and specifications
for any additional improvements to be made to the Premises, and for any other
action required in the reasonable judgment of Landlord. Landlord shall be
reimbursed at the rate of Seventy-Five Dollars ($75.00) per hour for the time
spent by its administrative and professional personnel, (or in the amount of One
Thousand Dollars ($1,000.00), whichever is greater), and at the actual cost of
professional fees and costs incurred by Landlord for persons not in the direct
employ of Landlord, for each such request made by Tenant. The hourly fee payable
to Landlord's administrative and professional personnel under this Paragraph
shall be increased by ten percent (10%) on each anniversary date of the
commencement of the term of this Lease.
26.19 No Guard Service. Tenant hereby acknowledges that the rent
----------------
payable to Landlord hereunder does not include the cost of guard service or
other security measures, and that Landlord shall have no obligation whatsoever
to provide any such service or measures. Tenant assumes all responsibility for
the protection of Tenant, its agents and invitees from acts of third parties.
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26.20 Brokers. Tenant represents and warrants to Landlord that
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Tenant has had no dealings with any real estate broker, finder or other person
with respect to this Lease in any manner, excepting only the brokers
specifically named in Item 1.9 of the Basic Lease Provisions. Tenant hereby
indemnifies and holds Landlord harmless from any liability or claim that may be
asserted against Landlord by any broker, finder or person with whom Tenant has
purportedly dealt whose name is not inserted in Item 1.9 of the Basic Lease
Provisions.
26.21 Brokerage Commission. Tenant acknowledges its understanding
--------------------
that Landlord has paid a real estate brokerage commission for securing Tenant's
tenancy at the Premises for the term of this Lease. If Tenant defaults under
this Lease and discontinues paying the rent specified herein, Tenant shall,
within thirty (30) days of such event, reimburse Landlord for the unamortized
portion of such brokerage commission pursuant to the following formula:
Total amount of Number of months of
brokerage commission x unexpired lease term.
-----------------------------------------------------
Number of months of lease term
Notwithstanding the foregoing, Landlord shall not be entitled to recover such
unamortized portions of the brokerage commission as provided in this Paragraph
26.21 if, following an uncured default under this Lease by Tenant, Landlord
elects to pursue its remedy against Tenant pursuant to California Civil Code
Section 1951.4, or if Landlord recovers the discounted present value of all rent
payable for the entire term of the Lease pursuant to California Civil Code
Section 1951.2. To the extent Landlord recovers the discounted present value of
some, but not all, of the rent payable following the termination of this Lease
resulting from Tenant's default, the number of months of such rent so recovered
by Landlord shall be subtracted from the "number of months of unexpired lease
term" in the formula set forth above.
26.22 Limitation of Liability. Tenant hereby agrees that, in the
-----------------------
event of any actual or alleged failure, breach or default hereunder by Landlord,
Tenant's sole and exclusive remedy shall be against and shall be satisfied from
the Landlord's equity interest in the Premises, Tenant's security deposit then
held by Landlord and the proceeds of any insurance or condemnation award paid or
payable to Landlord with respect to the Premises. Tenant agrees that the
obligations of Landlord under this Lease do not constitute personal obligations
of the individual directors, officers or shareholders of Landlord, and Tenant
shall not seek recourse against the individual directors, officers or
shareholders of Landlord or any of their personal assets for satisfaction of any
liability with respect to this Lease.
26.23 Parking. Tenant shall instruct and require that Tenant's
-------
employees, agents, visitors and business invitees park motor vehicles within the
parking areas included on the Premises; and such employees, agents, visitors and
invitees shall not park on the streets within the Xxxxxx Industrial Center. If
there is
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insufficient parking area included on the Premises for parking of such motor
vehicles, Tenant shall use its best efforts to obtain off-street parking
privileges on other properties in the vicinity of the Premises.
26.24 Lease Reviewed. Landlord and Tenant have carefully read and
--------------
reviewed this Lease and each term and provision contained herein, and each of
them has referred this Lease to its own legal counsel for review and advice as
to the legal consequences of this Lease. Landlord and Tenant acknowledge their
informed and voluntary consent thereto. Landlord and Tenant further agree that,
at the time this Lease is executed, the terms of this Lease are commercially
reasonable and effectuate the intent and purpose of Landlord and Tenant with
respect to the Premises.
26.25 Financial Statements. As a material inducement to Landlord's
--------------------
execution of this Lease, Tenant hereby represents and warrants that, to Tenant's
best knowledge, Tenant has furnished to Landlord true, complete, current and
unqualified financial statements of Tenant prepared in accordance with generally
accepted accounting principles in a manner consistently applied in each case.
Throughout the Lease Term, Tenant shall, within ten (10) days following
Landlord's request, provide Landlord with Tenant's then-current quarterly
financial statements. Landlord shall maintain such financial statements in
confidence, except for disclosure to prospective purchasers of the Premises and
prospective lenders whose loans would be secured in whole or in part by this
Lease or the Premises. Throughout the Lease Term, Tenant will furnish to
Landlord prompt notice of (i) any material obligation or material adverse
development with respect to the business, financial condition or results of
operations of Tenant; and (ii) any default under this Lease or any event, the
occurrence or nonoccurrence of which constitutes, or which with the giving of
notice or the passage of time or both would constitute, a default under Lease.
26.26 Lease Interest Rate. As used in this Lease, the "Lease Interest
-------------------
Rate" shall be a rate equal to two percent (2%) per year in excess of the
"Reference Rate" most recently announced by Bank of America, Los Angeles from
time to time, provided however that if Bank of America ceases to announce such
Reference Rate, then such rate shall be a rate comparable to such Reference
Rate; and provided further, however, that in no event shall the Lease Interest
Rate exceed the highest lawful rate of interest permissible by law.
26.27 Reasonable Expenditures: Except as otherwise provided in this
-----------------------
Lease, any expenditure by a party permitted or required under this Lease, for
which such party is entitled to demand and does demand reimbursement from the
other party, shall be limited to the fair market value of the goods and services
involved, shall be reasonably incurred, and shall be substantiated by
documentary evidence available for inspection and review by the other party or
its representative during normal business hours.
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IN WITNESS WHEREOF, the parties hereto have executed this Lease as of
the day and year first above written.
"LANDLORD" "TENANT"
Xxxxxx Partners, L.P., XxxxXxxxxx.xxx,
a Delaware limited partnership a Delaware corporation
By: Xxxxxx Land Company By: /s/ X. Xxxxxxx
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Its: General Partner Its: V.P. Operations
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By: /s/ illegible By: /s/ illegible
----------------- -----------------
Its: President/CEO Its: V.P. Merch.
---------------- -----------------
By: /s/ illegible
-----------------
Its: General Counsel/Corp. Secretary
--------------------------------
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