LYNNWOOD CORPORATE CENTER OFFICE SPACE LEASE
THIS LEASE, is made and entered into as of the 20th day of
February, 1997, between Lessor and Lessee hereinafter designated, upon
the terms and conditions as contained herein including all addends and
exhibits which are or may become attached hereto.
WHEREAS, Lessor desires to lease certain space to Lessee, and
Lessee desires to take and lease such space from Lessor, on terms and
conditions more fully described below (hereinafter referred to as the
"Premises");
NOW, THEREFORE, for and in consideration of the rents reserved
hereunder and the terms and conditions hereof, the Lessor hereby
rents, demises and leases to Lessee, and Lessee takes and leases from
Lessor, the following described Premises upon each and all of the
terms and conditions set forth herein.
1. BASIC LEASE PROVISIONS, DEFINITIONS AND DESCRIPTION OF EXHIBITS.
1.1 Basic Lease Provisions and Definitions.
a. LESSOR: LCTR L.L.C, a Washington Limited
Liability Company
b. ADDRESS OF LESSOR: 00000 00xx Xxxxxx Xxxx, Xxxxx 000,
Xxxxxxxx, Xxxxxxxxxx 00000
c. LESSEE: Chicago Pizza Northwest, Inc., a
Washington Corporation
d. DOING BUSINESS AS: Chicago Pizza Northwest, Inc., a
Washington Corporation
e. ADDRESS OF LESSEE: 00000 00xx Xxx. X.
(Local) Xxxxxxxx, XX 00000
f. LEASED PREMISES: An agreed area of 2,711 square feet, which
comprises an agreed 4.2% building area; Building
Suite number not yet assigned located on the third
floor in the Lynnwood Corporate Center; all as
outlined on the Demising Plan attached hereto as
Exhibit D.
g. LEASE TERM: Five (5) years, subject to the
provisions herein.
h. EFFECTIVE DATE: Date of execution, _________ ____ 19__
i. TERM COMMENCEMENT DATE: March 14, 1997, or as otherwise set
forth below.
j. TERMINATION DATE: March 13, 2002, or as otherwise set
forth below.
k. ANNUAL BASIC RENT: $13.00 per square foot plus NNN for
years 1 and 2, with annualized CPI escalations
each year thereafter.
l. PERMITTED USE: Office/General Management
m. SECURITY DEPOSIT: Four Thousand Six Hundred Dollars
($4,600.00)
n. RENT DEPOSIT: Four Thousand One Hundred Sixty
Eight and 17/100 Dollars (4,168.17)
o. BROKERS: Xxxxx Xxxxxxxxx, Xxxxxx Xxxxxxx &
Xxxxxx/Xxx X. Xxx, Olympic Funding
Corporation
p. GUARANTORS: Chicago Pizza & Brewery, Inc., a
California Corporation
00000 Xxxxxxxxx Xxxxxxx, Xxxxx
X
Xxxxxxx Xxxxx, XX 00000
Phone: (000) 000-0000
1.2 Building Standard Work. All the work to be done, or which
has been done, at Lessor's expense in the Premises pursuant to the
provisions of the Work Letter Agreement described in Paragraph 2
below.
1.3 Building Nonstandard Work. All the work to be done or which
has been done in the Premises by Lessor pursuant to the provisions of
the Work Letter Agreement other than the Building Standard Work.
1.4 Leasehold Improvements. The aggregate of the Building
Standard Work and the Building Nonstandard Work.
1.5 Exhibits.
Exhibit "A" Legal Description
Exhibit "B" Site Plan
Exhibit "C" Description of Lessor's and Lessee's Work
Exhibit "D" Demising Plan of Premises
Exhibit "E" Lessee's Acceptance Letter
Exhibit "F" Guaranty of Lease
Exhibit "G" Standards for Utilities and Services
1.6 Significance of Basic Lease Provisions. Each reference in
this Lease to any of the Basic Lease Provisions and definitions
contained in Paragraph 1 shall be deemed and construed to incorporate
all the terms provided under each such Basic Lease Provision;
provided, that the Basic Lease Provisions shall be controlled by the
specific terms and provisions of this Lease relating to the subject
matter of those Basic Lease Provisions.
2. PREMISES AND COMMON AREAS.
2.1 Definition. The Lessor is the owner of the real property
(hereinafter called "Building") of which the Premises is a part. The
Building is legally described on Exhibit "A" and the Building and
Premises are depicted in the Site Plan attached hereto as Exhibit "B"
and the Demising Plan of Premises in Exhibit "D". The term "Building"
wherever used herein shall be deemed to mean the entire development
described in Exhibits "A" and "B", including any and all proposed
structures, parking facilities, common facilities and the like to be
built on the aforementioned parcel of land, as the same may from time
to time be reduced by eminent domain takings, sale, lease, or
dedications to public authorities, or increased by the addition of
other lands together with structures and the like thereon which may be
included by Lessor in the development. The Lessee shall only have
such rights in and to the building as are specifically set forth
herein.
2.2. No Representations. It is agreed that the depiction of the
Building on Exhibit "B" does not constitute a representation, covenant
or warranty of any kind by Lessor, and Lessor reserves the right from
time to time to change the size and dimensions of the Building,
locate, relocate, alter, and/or modify the number and location of
buildings, building dimensions, the number of floors in any of the
buildings, the parking areas, dimensions, identity and type of other
uses and tenancies and the common area located from time to time in or
about the Building. Lessee agrees that it shall look solely to that
portion of the Building which constitutes the Premises with respect to
any liability accruing hereunder, it being expressly understood and
agreed that the Building and any other real estate which may
constitute a portion of the building shall be free from any such
liability. Lessor makes no representation or warranty with respect to
the occupancy by any Lessee or user, the date on which any Lessee
accepted or will accept occupancy of its space, or the use to which
any other Lessee will put its Premises.
2.3 Premises and Demise. Lessor hereby leases to Lessee and
Lessee hereby leases from Lessor, the Premises contained within the
suite designated in Paragraph 1. The Premises are, or shall be
improved by Lessor with the Leasehold Improvements described in the
Work letter Agreement, a copy of which is attached hereto and marked
Exhibit "C" and Exhibit "C-1" and incorporated herein by this
reference. It is agreed, for the purpose of this Lease, that the
Premises have an agreed area of approximately the number of square
feet designated in Paragraph 1 situated on the floor(s) designated in
Paragraph 1, of that certain office building located at the address
designated in Paragraph 1 (hereinafter called "Building"). The
Premises exclude the common stairways, stairwells, accessways and
pipes, conduits, wires and appurtenant fixtures serving exclusively or
in common other parts of the Building. By taking possession of the
Premises, Lessee accepts the Leasehold Improvements as completed or as
substantially completed, and in the latter case, Lessor shall provide
Lessee with a list of incomplete and/or corrective items, which list
shall be approved and acknowledged by Lessee and which items Lessor
shall, at Lessee's request, complete and/or correct promptly
thereafter. This Lease is subject to all easements, covenants,
restrictions, or other interests as they may appear, whether or not of
record.
The parties hereto agree that said letting and hiring is upon and
subject to the terms, covenants and conditions herein set forth and
Lessee covenants as a material part of the consideration for this
Lease to keep and perform each and all of said terms, covenants and
conditions by it to be kept and performed and that this Lease is made
upon the express condition of such performance, and that a failure of
any of the same shall be a material breach and a default.
2.4 Common Areas.
a. Lessee's Rights. The Lessee, its employees and invitees
are, except as otherwise provided, privileged to the nonexclusive use
of the common areas of the Building in common with other persons and
tenants during the Lease Term, subject to any easements, restrictions,
covenants or other interest with respect thereto, and further subject
to the Rules and Regulations as provided in Paragraph 25 below;
provided, however, that anything herein to the contrary
notwithstanding, nothing herein shall directly or indirectly create or
give rise to any rights of or to the public in the Building or its
common area or any part thereof. Such use shall be subject to said
Rules and Regulations.
b. Control of Common Areas by Lessor.
1) Lessor shall at all times have the exclusive control
and management of the common areas of the Building. The common areas
shall include but not be limited to all automobile parking areas,
access roads, driveways, entrances, pedestrian malls, courts,
restrooms, sidewalks, ramps, landscape areas, all stairways, access
ways, entrances, lobbies, elevators, and the common pipes, conduits,
wires and appurtenant equipment serving the Premises and Building, and
other areas, improvements, facilities and special services provided by
Lessor for the general use, in common, of lessees of the building, and
their officers, agents, employees and invitees.
2) With respect to the common area, Lessor shall have the
right from time to time to employ personnel; establish, modify and
enforce reasonable rules and regulations; construct, maintain and
operate lighting facilities; police the common areas and facilities;
from time to time to alter or relocate the area, level, location and
arrangement of parking area and other facilities hereinabove referred
to; to restrict or designate parking by Lessee, its officers, agents
and employees; to enforce parking charges (by operation of meters or
otherwise); to install, use, maintain, repair and replace pipes,
ducts, conduits, wires and appurtenant meters and equipment for
service to other parts of the Building above the ceiling surfaces,
below the floor surfaces within the wall and in the central core
areas, and to relocate any pipes, ducts, conduits, wires and
appurtenant meters and equipment included in the Premises which are
located in the Premises or located elsewhere outside the Premises, or
in the common area; to close all or any portion of the common areas to
such extent as may, in the opinion of Lessor's counsel, be legally
sufficient to prevent a dedication thereof or the accrual of any
interest therein by any person or the public; temporarily close all or
any portion of the parking areas or facilities to discourage non-
customer parking; and to do and perform such other acts in and to the
common areas as, in the use of good business judgment, Lessor shall
determine to be advisable with a view to the improvement of the
convenience and use thereof by lessees of the Building, their
employees, invitees and customers. Lessee understands that parking
may be apportioned in conformity with controlling zoning ordinances
and Lessor shall have the right to make such regulations as Lessor
deems desirable from time to time for the control of parking
automobiles and/or other vehicles on the real property described
herein or property under Lessor's control, so as to benefit all
tenants, their employees, customers and guests, including the right to
designate certain areas for parking of Lessee, employees of Lessee,
his customers or clients and other tenants of said buildings. All
parking by Lessee, its employees and invitees shall be non-assigned.
c. License. All common areas and facilities which Lessee may
be permitted to use and occupy, shall be used and occupied under a
revocable license. If the amount of such areas or facilities be
diminished, such diminution shall not be deemed a constructive or
actual eviction of Lessee and Lessor shall not be subject to any
liability, nor shall Lessee be entitled to any compensation,
diminution or abatement of rent.
3. POSSESSION, COMMENCEMENT AND TERMINATION OF LEASE TERM.
3.1 Term. This Lease shall be for the term set forth in
Paragraph 1.1 above (hereinafter referred to as the "Term" or "Lease
Term") and shall commence on the Commencement Date. The Lease Term
shall terminate at midnight of the termination date set forth in
Paragraph 1.1 above (hereinafter referred to as the "Termination
Date"), unless sooner terminated by the terms of this Lease. This
Lease shall be effective as of the date the Lease is fully executed.
3.2 Premises Ready for Occupancy. Lessee agrees that if Lessor
fails to deliver possession of Premises substantially ready for
occupancy at the commencement of the Lease Term, Lessor shall not be
liable for any damage caused thereby, nor shall this Lease become void
or voidable, nor shall the Effective Date or Lease Term be extended,
but in such event, no rental shall be payable by Lessee to Lessor for
any portion of the Lease Term until Lessor can deliver possession of
Premises to Lessee substantially ready for occupancy by Lessee. If
Lessee, at Lessor's permission, enters into possession of Premises
prior to commencement of the Lease Term, all terms and conditions of
this Lease shall apply during such prior period, including payment of
rent at the monthly rate stated in Paragraphs 4 and 5. Upon Lessor's
notification to Lessee of substantial completion of Lessee's space,
Lessee agrees to accept the Premises from Lessor at such time as
Lessor tenders delivery of possession of the Premises to Lessee with
Lessor's work therein, if any, substantially completed.
3.3 Acceptance of Premises. Upon delivery of the Premises to
Lessee, Lessee shall acknowledge to Lessor in writing within three (3)
days of delivery of possession of the Premises to Lessee that Lessee
has inspected the Premises and accepts them in their then condition or
else, within said three (3) day period, shall notify Lessor in writing
of any deficiencies then apparent; provided, that a failure by Lessee
to provide the above written notices to Lessor within said three (3)
day period shall conclusively be deemed acceptance of the Premises in
their then condition. The Lessor's obligation and/or liability to
Lessee for deficiencies shall be strictly limited to the correction of
the noted deficiencies, which correction shall be made only to the
extent of compliance with the Lessor's Work as set forth in Exhibit
"C". Lessee, Lessee's agent or representative shall execute, within
10 days of Lessor's notification, a Lessee's Acceptance letter in the
form of Exhibit "E", or such other form or any additional provisions
which may reasonably be required by Lessor's Lenders. Lessee
acknowledges that neither Lessor nor any agent of Lessor has made any
representation or warranty with respect to the Premises or the
Building or with respect to the suitability of either for the conduct
of Lessee's business. The taking of possession of the Premises by
Lessee shall conclusively establish that the Premises and the Building
were at such time in satisfactory condition.
4. ANNUAL BASIC RENT.
4.1 Lessee agrees to pay Lessor as Annual Basic Rent for the
Premises the Annual Basic Rent designated in Paragraph 1 (subject to
adjustment as hereinafter provided) in twelve (12) equal monthly
installments, each WITHOUT OFFSET, NOTICE OR DEMAND AND WITHOUT GRACE,
in advance on the first day of each and every calendar month during
said term, received at Lessor's office no later than said first day of
each calendar month. The first month's rent shall be paid upon the
execution hereof. Rent payable for any period of less than one
calendar month installment shall be a pro rata portion of the amount
payable based on a thirty (30) day calendar month. The first rental
installment payment shall be the sum of the first full month rental
installment plus the pro rata portion of the first partial month if
Lease Commencement is any day other than the first day of the month.
In addition to the Annual Basic Rent, Lessee agrees to pay the amount
of the rental adjustments as and when hereinafter provided in this
Lease. All rental shall be paid to Lessor, without any prior demand
therefore and without and deduction or offset whatsoever, in the
lawful money of the United States of America, which shall be legal
tender at the time of payment, at the address of Lessor designated in
Paragraph 1 or to such other person or at such other place as Lessor
may from time to time designate in writing. Lessee agrees to pay as
additional rent to Lessor, upon demand, Lessee's percentage of any
parking charges, utilities surcharges, or any other costs levied,
assessed or imposed by, or at the direction of, or resulting from
statutes or regulations, or interpretations hereof, promulgated by any
federal, state, regional, municipal or local governmental authority in
connection with the use or occupancy of the Building or the Premises
or the parking facilities serving the Building or the Premises.
Further, all charges to be paid by Lessee hereunder, including,
without limitation, payments for real property taxes, assessments,
insurance, repairs, operation, management, or other adjustments or
charges provided herein, shall be considered additional rent for the
purposes of the Lease, and the word "rent" in this Lease shall include
such additional rent unless the context specifically or clearly
implies that only the Annual Basic Rent is referenced.
4.2 The Annual Basic Rent as set forth hereinabove shall be
increased for each year ("Subsequent Year") of the term of this Lease
following the first year if the Consumer Price Index for All Urban
consumers (Seattle-Everett, Washington; Base: 1967-100) ("Index"), as
published by the United States Department of Labor, Bureau of Labor
Statistics, for the "Comparison Month" (described below) increases
over the Index for the calendar month ("Base Month") which is four (4)
months prior to the month in which the Effective Date hereof occurs.
The Base Month Index shall be compared with the Index for the same
calendar month for each Subsequent Year ("Comparison Month"). If the
Index for any Comparison Month is higher than the Base Month Index,
then the Annual Basic Rent for the Subsequent Year following the
Comparison Month shall be calculated by dividing the Base Month Index
into that number which represents the difference, if any, when
subtracting the Base Month Index from the Index for any Comparison
Month. In no event shall the Annual Basic Rent be less than that set
forth in Paragraph 4.1 above. If the escalations are to be annualized
but are not implemented each year, there shall be an imputed increase
each year per the terms of the formula, subject to its stated maximum
and minimum increase, which shall be the amount upon which the
escalation for the next ensuing year shall be calculated. In way of
illustration only, if the Effective Date occurs in August of 1981,
then the Base Month Index would be that for April, 1981 (assume such
index at 130) and that Index shall be compared with the Index for
April, 1982 (assume such Index at 136). Because the Index for April,
1982 is four and six-tenths percent (4.6%) higher than the Index for
April, 1981 based on the assumptions of 136 and 130, respectively, the
Annual Basic Rent commencing in August of 1982 would be four and six-
tenths percent (4.6%) higher than the Annual Basic Rent for the first
twelve months of the Lease Term. Likewise the Index for April, 1983
would be compared with the Index for April, 1981. Should said Bureau
discontinue the publication of the above Index or publish the same
less frequently, or alter the same in some other manner, the Lessor
shall adopt a substitute Index or substitute procedure which
reasonably reflects and monitors consumer prices. In no event shall
the annualized escalation exceed 7%, nor shall they be less than 3.5%.
5. ADDITIONAL RENT - PERIODIC ADJUSTMENTS.
5.1 Additional Rent. In addition to Annual Basic Rent, Lessee
shall pay to Lessor as additional Rent an amount estimated by Lessor
to be Lessee's share of building operating expenses (as defined in
this section). This amount is payable in advance on the first day of
each month per each and all of the terms related to the payment of
Basic Rent. Such Additional Rent for the first month or any portion
thereof shall be paid on or before the date the term commences.
Additional rent for any partial month shall be prorated.
5.2 Definitions. For the purpose of this lease, the following
terms are defined as follows:
a. Lease Year: Each calendar year of the Term of this
lease, or partial calendar year in the first and last years of the
term.
b. Lessee's Percentage: That portion of the Building
occupied by Lessee divided by the total square footage of the Building
which result is set forth as a percentage in Paragraph 1 above,
including a common area load factor, subject to an equitable
adjustment in the event of any disproportionate usage or consumption
by Lessee.
c. Operating Expenses: The term "Operating Expenses" shall
mean the amount of all Lessor's costs and expenses paid or incurred in
operating and maintaining the building and its supporting property for
a particular calendar year as determined by Lessor in accordance with
generally accepted accounting principles, consistently applied,
including by way of illustration and not limitation, all property
taxes and all assessments levied against the building or the real
property upon which it is located, other than penalties for late
payment, including costs and expenses of contesting the validity or
amount of any such taxes or assessments; insurance premiums; any non-
progressive tax on or measured by gross rentals received from the
rental of space in the Building; any parking charges, utilities
surcharges, or any other costs levied, assessed or imposed by, or at
the direction of, or resulting from statutes or regulations or
interpretations thereof, promulgated by any federal, state, regional,
municipal or local government authority in connection with the use or
occupancy of the Premises or the parking facilities serving the
premises; any tax on this transaction or any document to which Lessee
is a party creating or transferring an interest in the Premises, and
any expenses, including cost of attorneys or experts, reasonably
incurred by Lessor in seeking reduction by the taxing authority of the
above-referenced taxes; but shall not include any net income, capital
stock, estate or inheritance taxes; water, sewer, electrical and other
utility charges other than those separately billed to and paid by
Lessee as provided in this Lease; service and other charges incurred
in the operation and maintenance of any elevator and the heating,
ventilation, and air conditioning system; cleaning and other
janitorial services; independent contractors, suppliers, and vendors;
tools and supplies; repair costs; landscape maintenance and
replacement costs; ice and snow removal; security service; directional
signs and other markers; parking area maintenance; car stops; license,
permit and inspection fees; management fees, including an allowance to
Lessor for Lessor's supervision of maintenance and operation of the
building and the real property upon which it is located; wages and
related employee benefits payable for the maintenance and operation of
the building; professional services; the fair rental value of the
Building Office; and, in general, all other costs and expenses which
would, under generally accepted accounting principles, be regarded as
operating and maintenance costs and expenses, including those which
would normally be amortized over a period not to exceed five (5)
years. There shall also be included in Operating expenses the cost or
portion thereof reasonably allocable to the building amortized over
such period as Lessor shall reasonably determine, together with
interest at the rate of twelve percent (12%) per annum on the
unamortized balance, of any capital improvement made to the building
by Lessor after the date of the Lease which is required under any
governmental law or regulation that was not applicable to the building
at the time it was constructed, or which is installed as a labor-
saving device or other equipment, which improved the Operating
efficiency of any system within the building (such as an energy
management computer system, if one is not already installed in the
building) and thereby reduces operating expenses, then Lessor may add
to operating expenses in each year during the useful life of such
installed device or equipment an amount equal to the annual
amortization allowance of the cost of such installed device or
equipment as determined in accordance with applicable regulations of
the Internal Revenue Service or generally accepted accounting
principles, together with interest at the rate of twelve percent (12%)
per annum on the unamortized balance thereof; provided, however, that
the amount of such allowance and interest shall not exceed the annual
cost or expense reduction attributed by Lessor to such installed
device or equipment; and further provided that in no event shall such
allowance and interest increase Lessee's share of annual building
operating expenses over what it would have been if such labor-saving
device or other equipment had not been installed.
5.3 Periodic Adjustment. Tenant's share of building
operating expenses payable to Lessor monthly at the start of the lease
term shall be as set forth in Paragraph 1 of this Lease. Lessor may
adjust the Additional Rent effective at the beginning of any
accounting period on the basis of the Lessor's reasonably anticipated
building operating expenses for that accounting period. Operating,
Expense budgets and reconciliations shall be based on each calendar
year. Lessor shall furnish to Lessee as soon as reasonably
practicable after each calendar year a statement showing Lessee's
share of the actual building Operating expenses for such accounting
period and the payments made by Lessee in that regard along with
projected expenses for the following year. If Lessee's share of
actual building operating expense for the accounting period exceeds
the payments made by Lessee, Lessee shall pay lessor the deficiency
within thirty (30) days after receipt of the statement including any
deficiencies based on the current year for months which have already
lapsed. If Lessee's payments made during the accounting period exceed
Lessee's share of the actual building Operating expenses for such
period, Lessor shall credit such excess against the next Additional
Rent payment or payments due from Lessee. Lessee shall have the right
to inspect, at reasonable times and in a reasonable manner during the
thirty (30) days following delivery of Lessor's statement of Lessee's
share of actual Building operating expenses, such as Lessor's
reconciliation of costs as pertains to and contain information
concerning such costs and expenses in order to verify the amounts
thereof. Such inspection shall be at the sole cost and expense of
Lessee.
5.4 Operating Expenses. Even though the term has expired and
Lessee has vacated the Premises, when the final determination is made
of Lessee's percentage of Operating Expenses for the year in which
this Lease terminates, Lessee shall immediately pay any increase due
over the estimated expenses paid.
5.5 Default. In addition to the statutory or contractual
remedies which are provided elsewhere, and not in lieu of the same, in
the event Lessee fails or refuses at any time to pay when due its
share of the aforesaid expenses as set forth below, then legal
remedies may be instituted against the defaulting party for payment
plus interest at the rate of one and one-half percent (1 - 1/2%) per
month. In addition to the foregoing, if any party defaults under this
Agreement, any other part may institute legal remedies against the
remedy. In addition to recovery of the sum or sums as expended on
behalf of the defaulting party, the prevailing party shall be entitled
to receive from the losing party such amount as the court may adjudge
to be reasonable attorney's fees for the services rendered to the
prevailing party in such action, in addition to costs.
5.6 Rent Payment. In the event Lessor should fail to receive
any installment of rent or any sum due hereunder after such amount is
due, Lessee shall pay to Lessor as additional rent due immediately a
late charge equal to twelve (12%) percent of total rents due for the
period as liquidated damages to cover administration and collection
costs. Funds received by Lessor shall first be credited to rents and
charges in the order in which they were due. Additionally, interest
will accrue at the rate of one and one-half (1 - 1/2%) percent per
month on the past due rental and charges from the due date until paid.
A $25 charge will be paid by Lessee to Lessor for each returned check.
Receipt by the Lessor of the monies stipulated herein shall not
restrict the Lessor from any other actions or remedies as set forth
herein regarding the late payment or nonpayment of any monthly rent
payment or any other sum due hereunder. Notwithstanding the
provisions hereof, no charge or interest shall be imposed which is in
excess of the legal limit permitted by law.
5.7 License and Taxes. Lessee shall be liable for, and shall
pay throughout the lease Term, all license and excise fees and
occupation taxes covering the business conducted on the Premises. If
any governmental authority or unit under any present or future law
effective at any time during the Xxxxxx Term hereof shall in any
manner levy a tax on rents payable under this Lease or rents accruing
from use of the Premises or a tax in any form against Lessor because
of, or measured by, income derived from the leasing or rental of said
property, such tax shall be paid by Lessee, either directly or through
Lessor, and upon Lessee's default therein, Lessor shall have the same
remedies as upon failure to pay Minimum Rent. It is understood and
agreed, however, that Lessee shall not be liable to pay any net income
tax imposed on Lessor unless, and then only to the extent that, the
net income tax is a substitute for real estate taxes.
5.8 No Rent Offset. Lessee waives and disclaims any present
or future right to apply any payment or part payment of rent against
any obligations of Lessor however incurred, or to assert any such
obligation as an offset or counterclaim in any action for rent; and
agrees that it will not claim or assert any such right, offset or
counterclaim.
6. CARE AND USE OF PREMISES.
6.1 Permitted Use. During the Term of this Lease, or any
extension or renewal thereof, the Premises are to be used for the
purpose specifically specified in Paragraph 1 and for no other
business, use, or purpose. such use shall be conducted exclusively
under the name of Lessee, or the D/B/A specified in Paragraph 1.
6.2 Nature of Use. Lessee shall use and occupy the Premises in a
careful, safe and proper manner and shall keep the Premises in a clean
and safe condition in accordance with this lease and local ordinances
and the lawful directions of proper public officers. Lessee shall use
and maintain the Premises consistent with reasonable standards of good
professional office building operations, and Lessee shall not permit
solicitations, demonstrations, itinerant vending or any other
activities inconsistent with such standards.
6.3 Use Restrictions. Lessee shall not do or permit anything
to be done in or about the Premises nor bring or keep anything therein
which will in any way invalidate, restrict, or increase the cost of
any fire, "All-Risk", extended coverage or other insurance policy
covering the building and/or property located therein, and shall
comply with all rules, orders, regulations and requirements of the
Insurance Service Offices, formerly known as the Pacific Fire Rating
bureau, or any other organization performing a similar function,
relating to or affecting the condition and/or use or occupancy of the
Premises. In the event the Premises are a part of a larger building
or portion of a group of buildings owned by Lessor which are adjacent
to the Premises, then Lessee shall, within five days of demand, pay
for any increase in the property casualty insurance of said other
building or buildings if said increase is caused by Lessee's acts,
omissions, use or occupancy of the Premises. Lessee agrees that it
has determined to Lessee's satisfaction the Premises can be used for
the purpose for which they are leased. Lessee shall no permit any
objectionable noise or odor to escape or be emitted from the Premises.
Lessee shall not do or permit anything to be done in or about the
Premises which will in any way obstruct or interfere with the rights
of other tenants or occupants of the building or injure or annoy them
or use or allow the Premises to be used in any improper, immoral,
unlawful or objectionable purpose; nor shall Lessee cause, maintain or
permit any nuisance in, on or about the Premises. Lessee shall not
commit or suffer to be committed any disfigurement or injury to the
Building, and/or waste in or upon the Premises. The Premises shall
not be used for lodging or sleeping, and no animals or birds will be
allowed in the building. Lessee shall not store or display for sale
or advertising purpose, without Lessor's prior written consent, any
material, supplies, finished or semi-finished products, signs, banners
or any other items outside the Premises or building of which the
leased area is a part. Nor shall lessee install exterior lighting,
amplifier or similar devices which may be seen and/or heard outside
the premises. None of Lessee's obligations are conditioned upon the
manner in which the Lessor or successor employs the remainder of the
Building in which the Premises are situated or the business undertaken
by other tenants, or the degree of occupancy in the building. Lessee
shall not maintain or permit to be maintained within the Premises any
vending machines of any nature.
6.4 Lawful Use and Reputation of the Center. Lessee shall
not use the Premises or permit anything to be done in or about the
Premises which will in any way conflict with any Certificate Of
Occupancy issued for the Building, or of any master lease or ground
lease underlying the Premises, or which is in derogation of the
reputation and image of the Building and its business environment.
Lessee shall, at its sole cost and expense, promptly comply with all
laws, statutes, ordinances and governmental rules, regulations or
requirements now in force or which may hereafter be in force. The
judgment, diminished judgment, settlement with the court, or
adjudication of no content, on behalf of Lessee from any court of
competent jurisdiction or the admission by Lessee in an action against
Lessee, whether Lessor be party thereto or not, that Lessee has
violated any law, statute, ordinance or governmental rule, regulation
or requirement, shall be conclusive of that fact as between Lessor and
Lessee.
7. UTILITIES SERVICE.
7.1 Installation. Upon receipt of occupancy permit, Lessee
warrants that it has inspected the Premises and is satisfied with the
current nature and level of electrical service, heat, water and other
services (if any) supplied to the Premises and Lessor shall not be
required to install additional electrical power, heating or plumbing
to the Premises. All additional installation or distribution of
utilities shall be at Lessee's sole cost and responsibility. Lessee
shall pay the cost of installing separately metered services or
submitters to Premises.
7.2 Utilities and Services. Provided that lessee is not in
default of this Lease, Lessor agrees to furnish or cause to be
furnished to the Premises the utilities and services described in the
Standards for UTILITIES and Services, attached hereto as Exhibit "G",
subject to the conditions and in accordance with the standards set
forth therein. Lessor shall not be liable for, and Lessee shall not
be relieved from, the performance of any covenant or agreement in this
Lease because of lessor's failure to furnish any of the foregoing when
such failure is caused by accident, breakage, or repairs, strikes,
lockouts or other labor disturbances or labor dispute of any
character, governmental regulation, moratorium or other governmental
action, inability despite the exercise of reasonable diligence to
obtain electricity, water or fuel, or by any other cause beyond
Lessor's reasonable control. In the event of any failure, stoppage or
interruption thereof, Lessor shall diligently attempt to promptly
resume service.
8. CONSTRUCTION AND ALTERATION OF PREMISES.
8.1 By Lessor. This Lease may impose the obligation of
Lessor to construct improvements only if specifically set out in an
attached Exhibit and is initialled by lessor. Such work ("Lessor's
Work") shall be done in conformity with the description of Lessor's
Work as set forth in said attached Exhibit.
8.2 Construction by Lessee. Lessee shall cause Lessee's
construction work, if any, to be performed by licensed contractors,
approved by Lessor, and the contractors shall provide, if required by
Lessor, a performance and payment bond satisfactory to Lessor covering
all Lessee's work. Lessor reserves the right at any time and from
time to time without the same constituting an actual or constructive
eviction and without incurring any liability to Lessee therefore or
otherwise affecting Lessee's obligations under this Lease, to make
such changes, alterations, additions, improvements, repairs or
replacements in or to the Building (including the Premises if required
so to do by any law or regulation) and the fixtures and equipment
thereof as well as in or to the entrances, halls, passages and
stairways thereof, and to change the name by which the Building is
commonly known, as Lessor may deem necessary or desirable. Nothing
contained in this Subparagraph 8.2 shall be deemed to relieve Lessee
of any duty, obligation or liability of Lessee with respect to making
any repair, replacement or improvement or complying with any law,
order or requirement of any government or other authority. Nothing
contained in this Subparagraph shall be deemed or construed to impose
upon Lessor any obligation, responsibility or liability whatsoever,
for the care, supervision or repair of the Building or any part
thereof other than as expressly provided in this Lease.
8.3 Alteration. Lessee shall have the right to make
decorations, alterations, additions or improvements to the Premises
which Lessee deems necessary or desirable, but Lessee shall not make
or suffer to be made any alterations, additions or improvements to or
of the Premises of any part thereof without first obtaining the
written consent of Lessor, which consent may be subject to such
conditions as Lessor may deem appropriate. Any such alterations,
additions or improvements shall be made by Lessee, at Lessee's sole
cost and expense, and Lessee shall give Lessor written notice five (5)
days prior to employing any laborer or contractor to perform work
resulting in an alteration of the Leased Premises so that Lessor may
post a notice of non-responsibility. All such work shall be done at
such times and in such manner as Lessor may from time to time
designate. Lessee shall provide its own trash containers for
construction debris; shall use service entrances to the Premises; will
conduct no core drilling or xxxx-hammering during business hours; and
will not disrupt other tenants or their invitees. Lessee shall
promptly discharge its payment obligations to the laborer, vendors, or
contractor to avoid the filing of mechanics' liens or other liens and
charges which may result upon non-payment to the supplier, materialmen
or laborer. If Lessee desires telephonic or any other electronic
connection, Lessor will direct the installers and/or electricians as
to where and how the wires are to be introduced, and without such
directions no boring or cutting for wires or installation thereof will
be permitted. All costs related to telephone installation, service
and equipment shall be the sole cost of Lessee. Lessee agrees that it
will not install any equipment that will exceed or overload the
capacity of any utility equipment serving the building and that if any
equipment installed by Lessee shall require additional capacity the
same shall be installed at Lessee's expense in accordance with plans
and specifications to be approved in writing by Lessor.
8.4 Restrictions on Improvements. All changes or alterations to
the Leased Premises are subject to the following additional
conditions:
a. No improvement or alteration shall be permitted which
will impair the structural soundness or diminish the value of the
Building containing the Leased Premises or the property upon which it
is located. Lessee shall indemnify and hold Lessor harmless from any
and all liability, costs, damages, expenses (including attorneys'
fees) and from any and all liens or other claims resulting therefrom.
Upon the expiration or sooner termination of the Lease, Lessee shall
upon demand by Lessor, at Lessee's expense forthwith and with all due
diligence by Lessee, remove any such improvements as demanded by
Lessor to be removed, and Lessee shall, forthwith and with all due
diligence at its sole cost and expense, repair any damage to the
Premises caused by such removal.
b. All improvements or alterations shall be performed in a
good and workmanlike manner, in strict conformance to only those plans
and specifications which have been approved in writing by Lessor and
in compliance with all building and zoning laws or regulations, and in
accordance with all other laws, ordinances, orders, rules,
regulations, and requirements of federal, state, and municipal
governments, their appropriate departments, commissions, boards, and
officers; and Lessee shall obtain at Lessee's expense all necessary
certificates, permits, inspections and approvals.
c. At Lessor's option, Lessee shall be required to provide
general liability insurance for additional sums as deemed appropriate
by Lessor, naming Lessor and Lessor's property manager as an
additional insured, covering the hazards existing or caused during any
periods of alterations, repair or construction.
d. All alteration or construction work undertaken by Lessee
shall be per complete plans and specifications which shall be approved
in writing by Lessor. Upon completion of the work, Lessee shall
provide Lessor with accurate and complete "as-built" plans and
specifications. Failure of any of these conditions by Lessee shall be
a material breach.
9. REPAIRS, MAINTENANCE AND ALTERATIONS.
9.1 Condition of Premises. By entry hereunder, Lessee accepts
the Premises and the common areas as being in good, sanitary order,
condition and repair, and accepts any equipment on or in Leased
Premises in its existing condition. No representation, statement, or
warranty, express or implied, has been made by or on behalf of Lessor
regarding the condition of the Premises, common areas or equipment or
permissible uses. Lessee shall at all times throughout the Lease
Term, when and if needed or whenever requested by Lessor to do so, at
Lessee's sole cost and expense, keep the Premises (including interior
doors and entrances, all windows and mouldings and trim of all doors
and windows) and all partitions, door surfaces, fixtures, equipment
and appurtenances thereof (including lighting, heating and plumbing
fixtures, and restrooms, if a part of Demised Premises exclusively),
in first class condition and repair and in good working order
(including damage from burglary or attempted burglary of the
Premises), and make all repairs to the Premises and every part
thereof.
9.2 Lessor's Right to Repair. If the Lessee does not make
repairs promptly and adequately, or fails to maintain the Premises in
good repair, Lessor may, but shall not be required to make repairs
upon ten (10) days notice to Lessee, and Lessee shall pay promptly the
reasonable cost thereof, as additional rent, on the next rent date
thereafter. Lessor shall have a right of entry upon the Premises for
such purposes. Lessee agrees that "reasonable cost" as used in this
Paragraph 9, shall mean Lessor's out-of-pocket costs plus twenty
percent (20%) to cover overhead, administrative and collection
charges. Lessee shall, upon the termination of this Lease, surrender
the Premises to Lessor, in the same condition as when received or when
first installed, except for ordinary wear or for damage covered by
Lessor's fire and extended coverage insurance. There shall be no
abatement of rent and no liability of Lessor by reason of any injury
to or interference with Lessee's business arising from the making of
any repairs, alterations, or improvements in or to any portion of the
premises or building, common area, or to fixtures, appurtenances, and
equipment therein.
9.3 Lessor's Maintenance. Anything contained in Subparagraph
9.1 above to the contrary notwithstanding, Lessor shall repair and
maintain the structural portion of the Building, including the basic
plumbing, heating, ventilating, air conditioning and electrical
systems installed or furnished by Lessor, unless such maintenance and
repairs are caused in part or in whole by the act, neglect, fault of
or omission of any duty by Lessee, its agents, servants, employees or
invitees, in which case Lessee shall pay to Lessor, as additional
rent, the reasonable cost of such maintenance and repairs. Lessor
shall not be liable for any failure to make any such repairs or to
perform any maintenance unless such failure shall persist for an
unreasonable time after written notice of the need of such repair or
maintenance is given to Lessor by Lessee. Except as provided in
Paragraph 14 hereof there shall be no abatement of rent and no
liability of Lessor by reason of any injury to or interference with
Lessee's business arising from the making of any repairs, alterations
or improvements in or to any portion of the Building or the Premises
or to fixtures, appurtenances and equipment therein. Lessee waives
the right to make repairs at Lessor's expense under any law, statute
or ordinance now or hereafter in effect. Lessor shall not be liable
for any claims for damage resulting from leaking, frozen or ruptured
pipes, ceiling, or otherwise.
9.4 HVAC. Lessee shall operate all heating, ventilating, air
conditioning and/or other mechanical equipment in the building in
strict compliance with instructions, rules or regulations given by
Lessor or its agent. Any failure to adhere to this provision and
which causes damage directly or indirectly shall be the responsibility
of Lessee. Lessee shall pay all costs for maintenance, repair and
operation of all mechanical equipment used by Lessee, or serving
Lessee's premises, including a reasonable reserve for depreciation
cost of such equipment. Lessor may engage a maintenance contractor to
maintain and repair the heating, ventilating, and air conditioning
system, if any, servicing the Leased Premises. At Lessor's election,
Lessee shall pay its share of such costs directly to such vendor or
contractors. Under no circumstances shall Lessee or Lessee's agent be
allowed on the roof for any reason whatsoever.
9.5 Supplies. Lessee shall furnish all expendable items used in
the Premises to include, but not limited to, light bulbs, tubes,
ballasts, soaps, paper goods and supplies.
10. LIENS AND ENCUMBRANCES.
10.1 Liens. Lessee shall keep the real property in which the
Premises forms a part free from any liens arising out of any work
performed, materials furnished or any other obligations incurred by
Lessee. If any such liens are filed, Lessor may without waiving its
rights and remedies based on such breach of Lessee and without
releasing Lessee from any of its obligations, cause such liens to be
released by any means it shall deem proper, including payments in
satisfaction of the claim giving rise to such lien. Lessee shall pay
to Lessor at once, upon notice by Lessor, any sum paid by Lessor to
remove such liens, together with interest at the maximum rate per
annum permitted by law from the date of such payment by Lessor.
Lessor may require, at Lessor's sole option, that Lessee shall provide
to Lessor, at Lessee's sole cost and expense, payment and performance
bonds in an amount equal to one and one half (1-1/2) times the
estimated cost of such work, materials, labor and supplies and/or any
improvements, additions, or alterations in the Premises which the
Lessee desires to make, to insure Lessor against any liability for
mechanics' and materialmen's liens and to insure completion of the
work.
10.2 Encumbrances. The Lessee shall not cause or suffer to be
placed, filed or recorded against the title to the Premises, the
Building of which the Premises is a part, the Project in which the
Premises is located, or any part thereof, any mortgage, deed of trust,
security agreement, financing statement or other encumbrance; and
further, in no event shall any lien of Lessee's mortgage, deed of
trust, or other security agreement or financing statement cover the
Premises, the Building of which the Premises is a part or the Building
or any part thereof nor any leasehold improvements, alterations,
additions, or improvements thereto. The form of such mortgage, deed
of trust or other security agreement or financing statement which
includes a legal description of the Premises, or the Building of which
the Premises is a part or the address thereto, but not creating an
encumbrance thereon, shall be subject to Lessor's prior written
approval, which approval shall be subject to such conditions as the
Lessor may deem appropriate, and Lessor's approval shall be in
writing.
10.3 Costs. Lessee shall indemnify and hold Lessor harmless
from any and all liability, costs, damages, expenses, including
attorneys' fees and related costs, regardless of whether litigation
occurs, irrespective of the nature of the breach.
11. ENTRY BY LESSOR.
Lessor reserves and shall at any and all times have the right to
enter the Premises to inspect the same, to supply janitor service and
any other service to be provided by Lessor to Lessee hereunder, to
submit said Premises to prospective purchasers or tenants, to alter,
improve or repair the Premises or any other portion of the Building,
to post notice of non-responsibility, all without being deemed guilty
of any eviction of Lessee and without abatement of rent, and may, in
order to carry out such purposes, erect scaffolding and other
necessary structures where reasonably required by the character of the
work to be performed, and during the course of work being performed
keep and store upon the Premises all necessary material, supplies, and
equipment, provided that the business of Lessee shall be interfered
with as little as is reasonably practicable. Lessee hereby waives any
claim for damages for any injury or inconvenience to or interference
with Lessee's business, any loss of occupancy or quiet enjoyment of
the Premises, and any other loss in, upon and about the Premises, and
any other loss occasioned thereby. For each of the aforesaid
purposes, Lessor shall at all times have and retain a key with which
to unlock all of the doors in, upon and about the Premises, excluding
Lessee's vaults and safes. No additional locks shall be placed by
Lessee upon any doors in Premises and if more than two keys for any
lock are desired, such additional keys shall be paid for by Lessee.
All keys shall be duplicated only by Lessor, and under no circumstance
shall Lessee cause any key to be duplicated. Lessor shall have the
right to use any and all means which Lessor may deem proper to open
said doors in an emergency or in re-taking possession in order to
obtain entry to the Premises, and any entry to the Premises obtained
by Lessor by any of said means, or otherwise, shall not under any
circumstance be construed or deemed to be a forcible or unlawful entry
into, or a detainer of, the Premises, or an eviction of Lessee from
the Premises or any portion thereof, and any damages caused on account
thereof shall be paid by Lessee. It is understood and agreed that no
provision of the Lease shall be construed as obligating Lessor to
perform any repairs, alterations or decorations except as otherwise
expressly agreed herein to be performed by Lessor.
12. RISK AND INDEMNIFICATION.
12.1 Lessee agrees that Lessor shall not be liable for injury to
any person, or for the loss of or damage to any property (including
property of Lessee) occurring in or about the Premises and the common
area from any cause whatsoever. Lessee hereby indemnifies and holds
Lessor harmless from and against, and agrees to defend Lessor against,
any and all claims, charges, liabilities, obligations, penalties,
causes of action, liens, damages, costs and expenses (including
attorneys' fees) arising, claimed, charged or incurred against or by
Lessor from any matter or thing arising from Lessee's use or occupancy
of the Premises, the conduct of its business or from any activity,
work or other thing done, permitted or suffered by the Lessee in or
about the Premises whether prior or subsequent to the commencement of
the Term of this Lease, and Lessee shall further indemnify and hold
harmless Lessor from and against any and all claims arising from any
breach or default in the performance of any obligation on Lessee's
part or to be performed under the terms of this Lease, or arising from
any act, negligent fault or omission of the Lessee, or any officer,
contractor, agent, employee, guest, licensee, or invitee of Lessee,
and from all costs, attorneys' fees, and liabilities incurred in or
about the defense of any such claim (including appeals) or any action
or proceeding brought thereon and in case any action or proceeding be
brought against Lessor by reason of such claim. Lessee, upon notice
from Lessor, shall defend the same at Lessee's expense. Lessee as a
material part of the consideration to Lessor hereby assumes all risk
of damage to property or injury to persons in, upon or about the
Premises, from any cause whatsoever except that which is caused by the
failure of Lessor to observe any of the terms and conditions of this
Lease where such failure has persisted for an unreasonable period of
time after written notice of such failure.
12.2 The indemnification provided for in this Paragraph shall
survive any termination or expiration of this Lease. Lessor and its
agents shall not be liable for any loss or damage to persons or
property resulting from fire, explosion, falling plaster or other
material, steam, gas, electricity, or from bursting, overflowing, or
leaking of water, water or rain which may leak from any part of the
Premises or from pipes, appliances or plumbing works therein or from
the roof, street or subsurface or from any other place resulting from
dampness, from electrical wiring, circuitry, power surges, overloads,
spiking or interruption of any kind, air conditioning equipment, or
from gas or odors, sprinkler leakage, or caused in any manner, or from
any other cause whatsoever, unless caused by or due to the gross
negligence of Lessor, its agents, invitees, servants or employees.
Lessor and its agents shall not be liable for interference with the
light, air, or other incorporeal hereditaments or for any latent
defect on the Premises or the Building. Lessee shall give prompt
notice to Lessor in case of casualty or accidents on or about the
Premises. Lessor or its agents shall not be liable for any damage to
property entrusted to employees of the building or its management, nor
for the loss of or damage to any property by theft or otherwise.
13. INSURANCE.
13.1 Lessor's Insurance. Lessor shall procure and maintain at
all times during the Term of this Lease a policy or policies of
insurance covering loss or damage to the Premises in the amount of the
full replacement value thereof (exclusive of Lessee's trade fixtures,
non-standard tenant improvements, equipment and personal property),
providing protection against all perils included within the
classification of fire, extended coverage, all risk of loss as it
relates to the standard insuring clause, loss of rental income,
Lessor's risk liability coverage, and to the extent the Lender may
require or as Lessor may deem prudent, coverage against such other
hazards that are then commonly insured against for similar properties.
In the event said coverages have deductible clauses, Lessee shall be
liable for the deductible amount, or its proportionate amount. Such
insurance shall provide for payment of loss thereunder to Lessor
and/or the holder of any mortgages or deeds of trust or real estate
contracts on the premises. Lessee shall pay Lessee's equitable and
proportionate share of such insurance premiums to Lessor as additional
rent which is in express of the Direct Expenses Base.
13.2 Lessee's Liability Insurance. During the entire Lease Term
and at any time prior to the Lease Term, commencing with the day on
which the Lessee is given possession of the Premises for any reason,
the Lessee shall, at its own expense, maintain adequate liability
insurance with a reputable insurance company or companies with minimum
amounts of $1,000,000 combined single limit for personal injuries and
property damage, to indemnify both Lessor and Lessee against any and
all liability of Lessee with regard to the premises or use or
occupancy thereof, and its operation within the Building, and against
any such claims, demands, losses, damages, liabilities and the limit
of any such insurance shall not limit the liability of Lessee
hereunder. Lessor and the management company, if any, employed by
Lessor with respect to the Building shall be named as co-insureds.
13.3 Lessee's Fire and All Risk Coverage Insurance. Lessee
shall also at its own expense maintain, during the Lease Term, or any
other period of occupancy, and at any time prior to the lease term
commencing with the date on which the Lessee is given possession of
the Premises for any reason, insurance covering its furniture,
fixtures, equipment, all leasehold improvements and inventory in an
amount equal to not less than one hundred percent (100%) of the full
replacement value thereof and insuring against fire and all risk
perils coverage as provided by a standard all risk coverage
endorsement and the plate glass and all other glass is the
responsibility of the Lessee in the event of breakage from any cause.
Lessee shall, at its sole cost and expense, obtain and maintain
builder's risk insurance as the Lessor may require and covering any
work which Lessee may undertake, or have undertaken on Lessee's
behalf, with respect to the Premises. Lessee shall provide Lessor
with copies of the policies of insurance or certificates thereof. If
Lessee fails to maintain such insurance, Lessor may maintain the same
on behalf of Lessee. Any premiums paid by Lessor shall be deemed
additional rent and shall be due on the payment date of the next
installment of Basic Annual Rent hereunder, or at Lessor's option the
Lease may be immediately terminated, such failure on part of Lessee
being a default hereunder.
13.4 Insurance Policies. All insurance policies shall name
Lessor as additional insured and shall be with companies and with loss-
payable clauses satisfactory to Lessor, and certified copies or
originals of policies or certificates evidencing such insurance shall
be delivered to Lessor by Lessee prior to Lessee commencing occupancy
and thereafter within thirty (30) days prior to each renewal thereof.
Such certificate shall be from a company holding a "Best's Rating" of
at least A: Class IX, indicating that the insurance policy is in full
force and effect, and that the policy shall bear an endorsement that
the same not be cancelled or amended unless thirty (30) days prior
written notice by U.S. Certified Mail of the proposed cancellation or
amendment has been given to Lessor. Each of said certificates of
insurance and each such policy of insurance required to be maintained
by Lessee hereunder shall expressly evidence insurance coverage as
required by the Lease. All such policies shall be written as primary
policies not contributing with and not in excess of coverage which
Lessor may carry.
14. DAMAGE OR DESTRUCTION.
14.1 In the event the Building and/or the Building Standard Work
is damaged by fire or other perils covered by Lessor's insurance
Lessor shall:
a. In the event of total destruction, at Lessor's option,
within a period of ninety (90) days thereafter, commence repair,
reconstruction and restoration of said Building and/or Building
Standard Work and prosecute the same diligently to completion, in
which event this Lease shall remain in full force and effect; or
within said ninety (90) day period elect not to so repair, reconstruct
or restore said Building and/or Building Standard Work in which event
this Lease shall terminate. In either event, Lessor shall give Lessee
written notice of its intention within said ninety (90) day period.
In the event Lessor elects not to restore said Building and/or
Building Standard Work, this Lease shall be deemed to have terminated
as of the date of such total destruction.
b. In the event of a partial destruction of the Building
and/or Building Standard Work, to an extent not exceeding twenty-five
percent (25%) of the full insurable value thereof and if the damage
thereto is such that the Building and/or the Building Standard Work
may be repaired, reconstructed or restored within a period of ninety
(90) days from the date of the happening of such casualty and Lessor
will receive insurance proceeds sufficient to cover the cost of such
repairs, Lessor shall commence and proceed diligently with the work of
repair, reconstruction and restoration and the Lease shall continue in
full force and effect. If such work of repair, reconstruction and
restoration is such as to require a period longer than ninety (90)
days or exceed twenty-five percent (25%) of the full insurable value
thereof, or if said insurance proceeds will not be sufficient to cover
the cost of such repairs, Lessor either may elect to so repair,
reconstruct or restore and the Lease shall continue in full force and
effect or Lessor may elect not to repair, reconstruct or restore and
the Lease shall in such event terminate. Under any of the conditions
of this Subparagraph 14.1(a), Lessor shall give written notice to
Lessee of its intention within said ninety (90) day period. In the
event Lessor elects not to restore said Building and/or Building
Standard Work, this Lease shall be deemed to have terminated as of the
date of such partial destruction.
14.2 Upon any termination of this Lease under any of the
provisions of this Paragraph 14, the parties shall be released thereby
without further obligation to the other from the date possession of
the Premises is surrendered to Lessor except for items which have
therefore accrued and are then unpaid.
14.3 In the event of repair, reconstruction and restoration by
Lessor as herein provided, the rental provided to be paid under this
Lease shall be abated proportionately with the degree to which
Lessee's use of the Premises is impaired during the period of such
repair, reconstruction or restoration. Lessee shall not be entitled
to any compensation or damages for loss in the use of the whole or any
part of the Premises and/or any inconvenience or annoyance occasioned
by such damage, repair, reconstruction or restoration.
14.4 Lessee shall not be released from any of its obligations
under this Lease except to the extent and upon the conditions
expressly stated in this Paragraph 14. Notwithstanding anything to
the contrary contained in this Paragraph, should Lessor be delayed or
prevented from repairing or restoring the damaged Premises within one
(1) year after the occurrence of such damage or destruction by reason
of acts of God, war, governmental restrictions, inability to procure
the necessary labor or materials, or other cause beyond the control of
Lessor, Lessor shall be relieved of its obligation to make such
repairs or restoration and Lessee shall be released from its
obligations under this Lease as of the end of said one (1) year
period.
14.5 In the event that damage is due to any cause other than
fire or other peril covered by extended or all-risk coverage
insurance, Lessor may elect to terminate this Lease.
14.6 It is hereby understood that if Lessor is obligated to or
elects to repair or restore as herein provided, Lessor shall be
obligated to make repair or restoration only to those portions of the
Building and the Premises which were originally provided at Lessor's
expense, and the repair and restoration of items not provided at
Lessor's expense shall be the obligation of Lessee.
14.7 Notwithstanding anything to the contrary contained in this
Paragraph 14, Lessor shall not have any obligation whatsoever to
repair, reconstruct or restore the Premises when the damage resulting
from any casualty covered under this Paragraph occurs during the last
twelve (12) months of the Term of this Lease, or any extension hereof.
15. MUTUAL RELEASE AND WAIVER OF SUBROGATION. Lessee and Lessor do
each herewith and hereby release and relieve the other, or against any
other tenant or occupant of the Premises or Building, or against the
officers, employees, agents, representatives, customers and invitees
of such other party or of such other tenant or occupant of the
Building, and waive their right of subrogation and their entire claim
of recovery, for loss or damage to such waiving party or its property
or the property of others under its control, arising out of or
incident to fire, perils or any cause insured against included in the
extended or all-risk coverage endorsement, standard form of fire
insurance policy, with all permissible extension endorsements covering
additional perils or loss, or under any other policy of insurance
carried by such waiving party in lieu thereof; all risk of loss as it
relates to the standard insuring clause and sprinkler leakage, in, on
or about said Premises, whether due to negligence of any of the said
parties, their agents, employees or otherwise. Each party shall so
inform their respective insurance carriers of this clause and shall
obtain any special endorsements, if required by their insurer to
evidence compliance with the aforementioned waiver. Lessee shall, at
request of Lessor, execute and deliver to Lessor a form of Waiver of
subrogation in the form and content as required by Lessor's insurance
carrier.
16. EMINENT DOMAIN. In the case the whole of the Premises, or such
part thereof as shall substantially interfere with Lessee's use and
occupancy thereof, shall be taken for any public or quasi-public
purpose by any lawful power or authority by exercise of the right of
appropriation, condemnation or eminent domain, or sold to prevent such
taking, either party shall have the right to terminate this Lease
effective as of the date possession is required to be surrendered to
said authority. Lessee shall not assert any claim against Lessor or
the taking authority for any compensation because of such taking, and
Lessor shall be entitled to receive the entire amount of any award
without deduction for any estate or interest of Lessee. In the event
the amount of property or the type of estate taken shall not
substantially interfere with the conduct of Lessee's business, Lessor
shall be entitled to the entire amount of the award without deduction
for any estate or interest of Lessee, and Lessor at his option may
terminate this Lease. If Lessor does not so elect, Lessor shall
promptly proceed to restore the Premises to substantially their same
condition prior to such partial taking, and a proportionate allowance
shall be made to Lessee for the rent corresponding to the time during
which, and to the part of the Premises of which, Lessee shall be so
deprived on account of such taking and restoration. Nothing contained
in this Paragraph shall be deemed to give Lessor any interest in any
award made to Lessee for the taking of personal property and fixtures
belonging to Lessee. A sale by Lessor to any authority with the power
of eminent domain either under threat of condemnation or while
condemnation proceedings are pending, shall be deemed a taking under
the power of eminent domain under this Paragraph.
17. DEFAULTS AND REMEDIES.
17.1 Default. The occurrence of any one or more of the
following events shall constitute a default and breach of this Lease
by Lessee:
a. Vacation and Abandonment. The vacation or abandonment
of the Premises by Lessee. Abandonment is herein defined to include,
but is not limited to, any absence by Lessee from the Premises for
five (5) business days or longer while in default of any provisions of
this Lease.
b. Failure to Pay Rent. The failure by Lessee to make any
payment of rent or additional rent or any other payment required to be
made by Lessee hereunder, as and when due, where such failure shall
continue for a period of three (3) days after written notice thereof
from Lessor to Lessee.
c. Failure to Perform. The failure by Lessee to observe or
perform any of the expressed or implied covenants, conditions or
provisions of this Lease to be observed or performed by the Lessee,
other than described in Paragraph 17.1(b) above, where such failure
shall continue for a period of five (5) days after written notice
thereof by Lessor to Lessee; provided, however, that if the nature of
Lessee's default is such that more than five (5) days are reasonably
required for its cure, then Lessee shall not be deemed to be in
default if Lessee commences such cure within said five (5) days period
and thereafter diligently prosecutes such cure to completion, but in
no event shall such default extend beyond thirty (30) days.
d. Bankruptcy or Insolvency.
1) The making by Lessee of any general assignment for
the benefit of creditors;
2) the filing by or against Lessee of a petition to
have Lessee adjudged as bankrupt, or a petition or reorganization or
arrangement under any law relating to bankruptcy (unless, in the case
of a petition filed against Lessee, the same is dismissed within
thirty (30) days of filing);
3) the appointment of a trustee or a receiver to take
possession of substantially all of Lessee's assets located at the
Premises or of Lessee's interest in this Lease, where possession is
not restored to Lessee within thirty (30) days; or
4) the attachment, execution or other judicial seizure
of substantially all of Lessee's assets located at the Premises or of
Lessee's interest in this Lease where such seizure is not discharged
within thirty (30) days, whichever shall first occur.
17.2 Remedies in Default. In the event of any such default or
breach by Lessee, in addition to any other remedies available to
Lessor at law or in equity, Lessor may at any time thereafter, with or
without notice or demand and without limiting Lessor in the exercise
of a right or remedy which Lessor may have by reason of such default
or breach at law or in equity:
a. Re-enter and Take Possession. Re-enter said Premises,
with or without process of law, using such force as may be required
and remove all persons, fixtures or chattels therefrom. In the event
of any such retaking of possession of Premises by Lessor herein
provided, Lessee shall remove all personal property located thereon
and upon failure to do so upon demand of Lessor, Lessor may in
addition to any other remedies allowed by law, remove and store the
same in any place selected by Lessor, including but not limited to a
public warehouse, at the expense and risk of Lessee. If Lessee shall
fail to pay any sums due hereunder together with the cost of storing
any such property after it has been stored for a period of thirty (30)
days or more, Lessor may sell any or all of such property at public or
private sale and shall apply the proceeds of such sale first, to the
cost of such sale; second, to the payment of the charges for storage,
if any; and third, to the payment of any other sums of money which may
be due from Lessee to Lessor under the terms of this Lease; and the
balance, if any, to Lessee. Lessee hereby waives all claims for
damages that may be caused by Lessor's re-entering and taking
possession of Premises or removing and storing or selling the property
of Lessee as herein provided, and will indemnify and save Lessor
harmless from loss, costs or damages occasioned Lessee thereby, and no
such re-entry shall be considered or construed to be a forcible entry.
Upon such re-entry, Lessor may elect either to declare this Lease
forfeited and the Lease terminated, or without terminating the Lease,
to re-let all or any part of the Premises as the agent of and for the
account of the Lessee upon such terms and conditions as Lessor may
deem advisable, for a term which may expire before or after the
expiration date of this Lease. RE-ENTRY OR TAKING POSSESSION OF SAID
PREMISES BY LESSOR SHALL NOT BE CONSTRUED AS AN ELECTION ON ITS PART
TO TERMINATE THIS LEASE UNLESS A WRITTEN NOTICE OF SUCH INTENTION BE
GIVEN TO LESSEE. Notwithstanding such re-entry by Lessor, or whether
the Lease is terminated or not, the liability of Lessee for the rent
provided for herein shall not be extinguished for the balance of the
Term of this Lease. The rents received on such re-letting shall be
applied first to the expenses of re-letting and collection as
hereinafter provided.
b. Continue the Lease. Lessor may maintain Lessee's right
to possession, in which case this Lease shall continue in effect
whether or not Lessee shall have abandoned the Premises. In such
event Lessor shall be entitled to enforce all Lessor's rights and
remedies under this Lease, including the right to recover the Basic
Annual Rent and any other charges and Adjustments as may become due
hereunder and to be reimbursed for all costs and expenses if Premises
are re-let as described in Subparagraph (d) hereunder;
c. Terminate Lease. Terminate Lessee's right to possession
and use of the Premises by any lawful means, in which case this Lease
shall terminate and Lessee shall immediately surrender possession of
the Premises to Lessor. Lessor shall be reimbursed for all costs and
expenses if Premises are re-let as described in Subparagraph (d)
hereunder;
d. Monetary Damages and Recovery. Lessee hereby
specifically agrees to accept full liability for payment of all
damages directly or indirectly suffered by Lessor which are
proximately caused by any default or breach pursuant to this Lease,
whether or not such default or breach is declared by Lessor, and such
elements of damage and recovery by Lessor from Lessee shall
specifically include, but not be limited to:
1) the worth at the time of award of any unpaid rent
which had been earned at the time of such termination of the Lease or
possession; plus
2) the worth at the time of award of the amount by
which the unpaid rent which would have been earned after termination
of the Lease or possession until the time of award exceeds the amount
of such rental loss that Lessee proves could have been reasonably
avoided; plus
3) the worth at the time of award of the amount by
which the unpaid rent for the balance of the Term after the time of
award exceeds the amount of such rental loss that Lessee proves could
be reasonably avoided; plus
4) any other amount necessary to compensate Lessor for
all the detriment proximately caused by Lessee's failure to perform
his obligations under this Lease or which in the ordinary course of
things would be likely to result therefrom, including but not limited
to:
As used in Subparagraphs 17(d)(1) and (2) above, the "worth at
the time of award" is computed by allowing interest at one and one-
half percent (1-1/2%) per month. As used in Subparagraph 17(d)(3)
above, the "worth at the time of award" is computed by discounting
such amount at the discount rate of the Federal Reserve Bank of San
Francisco at the time of award plus one percent (1%).
The expenses of re-letting the Premises, including but not
limited to necessary changes, improvements, renovation and alteration
of the Premises (including advertising, administrative, overhead and
expense, leasing commissions for the re-letting, legal and accounting
costs and fees); the worth at the time of such award of the excess, if
any, of the amount of rent and charges equivalent to rent reserved in
this Lease for the remainder of the stated term over the then
reasonable rental value of the Premises for the remainder of the
stated Term or which amount is in excess of the actual rent collected
or contracted from re-letting the Premises. In the event the Lease or
possession is terminated and the Premises are subsequently re-let, no
portion of the rents from such new Lease which is in excess of the
contracted rent hereunder shall be treated as an offset to monies owed
by defaulting Lessee. All unpaid installments of rent or other sums
after their due date shall bear interest from the date due at the rate
of one and one-half percent (1-1/2%) per month in addition to any late
charges which may be imposed for covering administration costs related
to such delinquency, whether or not a default is declared. In
addition to any other remedy and damages Lessor may have, Lessor may
recover from Lessee all damages Lessor may incur by reason of such
breach, including but not limited to the above-itemized costs of
recovering and re-letting the Premises; or
e. Other Remedies. Lessor may pursue any other remedy now
or hereafter available to Lessor under the laws or judicial decisions
of the State in which the Premises are located, including but not
limited to the right to assess against Lessee an amount equal to the
attorneys' fees and all costs incurred by Lessor in collecting any
rent or other payment due hereunder, whether or not litigation
ensures, and including appeals, which amount shall be due in full
within ten (10) days of Lessee's receipt of the assessment by Lessor.
17.3 Remedies Cumulative - Waiver. It is understood and agreed
that the Lessor's remedies hereunder are cumulative and the Lessor's
exercise of any right or remedy due to a default or breach by Lessee
shall not be deemed a waiver of, or to alter, affect or prejudice any
right or remedy which Lessor may have under this Lease or by law or in
equity. Neither the acceptance of Basic Annual Rent or Adjustments
nor any other acts or omission of Lessor at any time or times after
the happening of any event authorizing the cancellation or forfeiture
of this Lease, shall operate as a waiver of any past or future
violation, breach or failure to keep or perform any covenant,
agreement, term or condition hereof or to deprive Lessor of its right
to cancel or forfeit this Lease, upon the written notice provided for
herein, at any time that cause for cancellation or forfeiture may
exist, or be construed so as at any time to stop Lessor from promptly
exercising any other option, right or remedy that it may have under
any term or provision of this Lease, at law or in equity.
18. ASSIGNMENT AND SUBLETTING.
18.1 Lessee shall not, either voluntarily or by operation of
law, assign, sell, hypothecate or transfer this Lease, or sublet the
premises or any part thereof, or permit or suffer the Premises or any
part thereof to be used or occupied as work space, storage space, mail
drop, concession or otherwise, by anyone other than Lessee or Lessee's
employees without the prior express written consent of Lessor in each
instance, which consent shall be subject to such conditions as Lessor
may deem appropriate. In the event Lessee desires to request approval
to assign, hypothecate or otherwise transfer this Lease or sublet the
Premises, then at least thirty (30) days prior to the date when Lessee
desires the assignment or sublease to be effective (the "Assignment
Date"), Lessee shall give Lessor a notice (the "Assignment Notice"),
which shall set forth the name, address and business of the proposed
assignees or sublessee, current and signed financial statements,
credit information as required by Lessor, the Assignment Date, any
ownership or commercial relationship between Lessee and the proposed
assignee or sublessee, and the consideration and all other material
terms and conditions of the proposed assignment or sublease, all in
such detail as Lessor shall reasonably require. If Lessor requests
additional detail, the Assignment Notice shall not be deemed to have
been received until Lessor receives such additional detail, and Lessor
may withhold action on the request to any assignment or sublease until
such information is provided to it. Any sale, assignment,
hypothecation or transfer of this Lease or subletting of the Premises
that is not in compliance with the provisions of this Paragraph shall
be void and shall, at the option of Lessor, terminate this Lease. Any
consent by Lessor to any assignment or subletting shall not be
construed as relieving Lessee or any assignee of this Lease or
sublessee of the Premises from obtaining the express written consent
of Lessor to any further assignment or subletting or as releasing
Lessee or any assignee or sublessee of Lessee from any liability or
obligation hereunder whether or not then accrued. In the event Lessee
requests Lessor's consent to an assignment or sublease, Lessee shall
pay Lessor as additional rent a reasonable administrative fee for
costs incurred in connection with evaluating the Assignment Notice. A
minimum charge for this service shall be $200.00, and shall not exceed
$750.00. Lessee also agrees to reimburse Lessor for Lessor's
reasonable attorney's fees incurred in connection with the processing,
review and documentation of any such requested transfer, assignment,
subletting, licensing or concession agreement, change of ownership or
encumbrance of this Lease or Lessee's interest in and to the Premises,
and for all other reasonable and necessary costs and consultants
related thereto. A change in the majority of the ownership of the
capital stock of a corporate Lessee or a change of partners in a
partnership Lessee, shall constitute an assignment. Upon Lessor's
consent, Lessee shall have the right to assign or transfer any and all
of its rights and privileges under this Lease to any corporation or
partnership in which Lessee is a principal. This section shall be
fully applicable to all further sales, hypothecations, transfers,
assignments and subleases of any portion of the Premises by any
successor or assignee of Lessee, or any sublessee of the Premises.
18.2 Lessor may, in its absolute discretion, withhold consent to
any assignment, sale, hypothecation or transfer of this Lease for any
reason whatsoever. As used in this section, the subletting of
substantially all of the Premises for substantially all of the
remaining term of this Lease shall be deemed an assignment rather than
a sublease. Notwithstanding the foregoing, Lessor shall consent to
the assignment, sale or transfer if the Assignment Notice states that
Lessee desires to assign the Lease to any entity into which Lessee is
merged, with which Lessee is consolidated or which acquires all of
substantially all of the assets of Lessee, provided that the assignee
first executes, acknowledges and delivers to Lessor an agreement
whereby the assignee agrees to be bound by all of the covenants and
agreements in this Lease which Lessee has agreed to keep, observe or
perform, that the assignee agrees that the provisions of this
Paragraph shall be binding upon it as if it were the original Lessee
hereunder and that the assignee shall have a net worth (determined in
accordance with generally accepted accounting principles consistently
applied) immediately after such assignment which is at least equal to
the net worth (as so determined) of Lessee immediately prior to the
assignment.
18.3 If Lessee shall sublet all or any portion of the Premises,
then any consideration paid by the sublessee for the portion of the
Premises being sublet that exceeds one hundred percent (100%) of the
Basic Rent and rental adjustments provided by this Lease for such
portion of the Premises being sublet shall be due, owing and payable
from Lessee to Lessor when paid or owing by the sublessee under the
sublease. For the purpose of this Paragraph, the rent for each square
foot of floor space in the Premises shall be deemed equal.
19. SURRENDER OF PREMISES.
19.1 Surrender of Premises. At the expiration or sooner
termination of this Lease, Lessee shall return the Premises to Lessor
in the same condition in which received (or, if altered by Lessor or
by Lessee with the Lessor's consent, then the Premises shall be
returned in such altered condition only at Lessor's election),
reasonable wear and tear excepted. Lessee shall remove all trade
fixtures, appliances and equipment (where such removal will not
require structural changes to the premises) which do not become a part
of the Premises and alterations which Lessor designates to be removed
pursuant to Paragraph 8.3 above, and shall restore the Premises to the
condition they were in prior to the installation of said items.
Lessee's obligation to perform this covenant shall survive the
expiration or termination of this Lease.
19.2 Non Merger. The voluntary or other surrender of this Lease
by Lessee, or a mutual cancellation thereof, shall not work a merger,
and shall, at the option of Lessor, terminate all or any existing
sublease or subtenancies, or may, at the option of Lessor, operate as
an assignment to it of any or all such subleases or subtenancies.
20. EFFECT OF BANKRUPTCY OR OTHER PROCEEDINGS.
a. If a petition is filed by, or an order for relief is
entered against, the Lessee under Chapter 7 of the Bankruptcy Code and
the Trustee of the Lessee elects to assume this Lease for the purpose
of assigning it, the election or assignment, or both, may be made only
if all of the terms and conditions of Subparagraphs (b) and (d) of
this Lease are satisfied. If the Trustee fails to elect to assume
this Lease for the purpose of assigning it within sixty (60) days
after his appointment, this Lease will be deemed to have been
rejected. The Lessor shall then immediately be entitled to possession
of the Demised Premises without further obligation to the Lessee or
the Trustee, and this Lease will be canceled. The Lessor's right to
be compensated for damages in this bankruptcy proceeding, however,
shall survive.
b. If the Lessee files a petition for reorganization under
chapters 11 or 13 of the Bankruptcy Code or a proceeding that is filed
by or against the Lessee under any other chapter of the Bankruptcy
Code is converted to a chapter 11 or 13 proceeding and the Lessee's
Trustee or the Lessee as a Debtor-in-Possession fails to assume this
Lease within sixty (60) days from the date of the filing of the
petition or the conversion, the Trustee or the Debtor-in-Possession
will be deemed to have rejected this Lease. To be effective, an
election to assume this Lease must be in writing and addressed to the
Lessor and, in the Lessor's business judgment, all of the following
conditions, which the Lessor and the Lessee acknowledge to be
commercially reasonable, must have been satisfied:
1) The Trustee or the Debtor-in-Possession has cured
or has provided to the Lessor adequate assurance, as defined in this
Paragraph, that:
A) The Trustee will cure all monetary defaults
under this Lease within ten (10) days from the date of the assumption;
and
B) The Trustee will cure all nonmonetary defaults
under this Lease within thirty (30) days from the date of the
assumption.
2) The Trustee or the Debtor-in-Possession has
compensated the Lessor, or has provided to the Lessor adequate
assurance, as defined in this Paragraph, that within ten (10) days
from the date of the assumption the Lessor will be compensated for any
pecuniary loss he incurred arising from the default of the Lessee, the
Trustee, or the Debtor-in-Possession as recited in the Lessor's
written statement of pecuniary loss sent to the Trustee or the Debtor-
in-Possession.
3) The Trustee or the Debtor-in-Possession has
provided the Lessor with adequate assurance of the future performance
of each of the Lessee's obligations under the Lease; provided,
however, that:
A) The Trustee or Debtor-in-Possession will also
deposit with the Lessor, as security for the timely payment of rent,
an amount equal to three months' rent (as adjusted pursuant to
Paragraph 25(3)(c) below) and other monetary charges accruing under
this Lease.
B) If not otherwise required by the terms of this
Lease, the Trustee or the Debtor-in-Possession will also pay in
advance, on each day that the minimum rent is payable, one-half of the
Lessee's annual obligations under the Lease for maintenance, common
area charges, real estate taxes, merchant's association dues,
insurance, and similar charges.
C) From and after the date of the assumption of
this Lease, the Trustee or Debtor-in-Possession will pay as minimum
rent an amount equal to the sum of the minimum rental otherwise
payable under this Lease plus the highest amount of the annual
percentage rent paid by the Lessee to the Lessor within the five-year
period to the date of the Lessee's petition under the Bankruptcy Code.
This amount will be payable in advance in equal monthly installments
on each day that the minimum rent is payable.
D) The obligations imposed upon the Trustee or
the Debtor-in-Possession will continue for the Lessee after the
completion of bankruptcy proceedings.
4) The Lessor has determined that the assumption of
the Lease will not:
A) Breach any provision in any other lease,
mortgage, financing agreement, or other agreement by which the Lessor
is bound relating to the shopping center premises; or
B) Disrupt, in the Lessor's judgment, the Lessee
mix of the shopping center or any other attempt by the Lessor to
provide a specific variety of retail store in the shopping center
that, in the Lessor's judgment, would be most beneficial to all of the
Lessees of the shopping center and would enhance the image,
reputation, and profitability of the shopping center.
5) For purposes of this Paragraph, "adequate
assurance" means that:
A) The Lessor will determine that the Trustee or
the Debtor-in-Possession has, and will continue to have, sufficient
unencumbered assets after the payment of all secured obligations and
administrative expenses to assure the Lessor that the Trustee or the
Debtor-in-Possession will have sufficient funds to fulfill the
Lessee's obligations under this Lease and to keep the Demised Premises
stocked with merchandise and properly staffed with sufficient
employees to conduct a fully operational, actively promoted business
on the Demised Premises; and
B) An order will have been entered segregating
sufficient cash payable to the Lessor and/or a valid and perfected
first lien and security interest will have been granted in property of
the Lessee, Trustee, or Debtor-in-Possession that is acceptable for
value and kind to the Lessor, to secure to the Lessor the obligation
of the Trustee or Debtor-in-Possession to cure the monetary or
nonmonetary defaults under this Lease within the time periods set
forth above.
c. In the event that this Lease is assumed by a Trustee
appointed for the Lessee or by the Lessee as Debtor-in-Possession
under the provision of Paragraph 25(b) of this Lease and thereafter,
the Lessee is either adjudicated as bankrupt or files a subsequent
petition for arrangement under Chapter 11 of the Bankruptcy Code, then
the Lessor may terminate, at its option, this Lease and all the
Lessee's rights under it, by giving written notice of the Lessor's
election to terminate.
d. If the Trustee or the Debtor-in-Possession has assumed
the lease, under the terms of Paragraphs 25(a) or 25(b) of this Lease,
to assign or to elect to assign the Lessee's interest under this Lease
or the estate created by that interest to any other person, that
interest or estate may be assigned only if the Lessor acknowledges in
writing that the intended Assignee has provided adequate assurance, as
defined in the Paragraph 25(5)(d) of future performance of all of the
terms, covenants, and conditions of this Lease to be performed by the
Lessee. For the purposes of this Paragraph, adequate assurance of
future performance means that the Lessor has ascertained that each of
the following conditions has been satisfied:
1) The Assigned has submitted a current financial
statement, audited by a Certified Public Accountant, that shows a net
worth and working capital in amounts determined by the Lessor to be
sufficient to assure the future performance by the Assignee of the
Lessee's obligation under this Lease;
2) If requested by the Lessor, the Assignee will
obtain guarantees, in form and substance satisfactory to the Lessor,
from one or more persons who satisfy the Lessor's standards of credit
worthiness;
3) The Assignee has submitted written evidence,
satisfactory to the Lessor, of substantial retailing experience in
shopping centers of comparable size to the shopping center that is the
subject of this Lease and in the sale of merchandise and services
permitted under this Lease; and
4) The Lessor has obtained all consents or waivers
from any third party required under any lease, mortgage, financing
arrangement, or other agreement by which the Lessor is bound, to
enable the Lessor to permit the assignment.
e. When, pursuant to the Bankruptcy Code, the trustee or
the Debtor-in-Possession is obligated to pay reasonable use and
occupancy charges for the use of all or part of the Demised Premises,
the charges will not be less than the minimum rent as defined in this
Lease and other monetary obligations of the Lessee for the payment of
maintenance, common area charges, real estate taxes, merchant's
association dues, insurance, and similar charges.
f. Neither the Lessee's interest in the Lease nor any
estate of the Lessee created in the Lease will pass to any trustee,
receiver, assignee for the benefit of creditors, or any other person
or entity, or otherwise by operation of law under the laws of any
state having jurisdiction of the person or property of the Lessee
("state law"), unless the Lessor consents in writing to this transfer.
The Lessor's acceptance of rent or any other payments from any
trustee, receiver, assignee, person, or other entity will not be
deemed to have waivered, or waive, the need to obtain the Lessor's
consent or the Lessor's right to terminate this Lease for any transfer
of the Lessee's interest under this Lease without that consent.
g. The Lessor may terminate, at its option, by giving the
Lessee written notice of this election, this Lease and all of the
Lessee's rights under this Lease if any of the following events occur:
1) The Lessee's estate created by this Lease is taken
in execution or by other process of law;
2) The Lessee or any Guarantor of the Lessee's
obligations under this Lease ("Guarantor") is adjudicated as insolvent
pursuant to the provisions of any present or future insolvency law
under the laws of any state having jurisdiction;
3) Any proceedings are filed by or against that
Guarantor under the Bankruptcy Code or any similar provisions of any
future federal bankruptcy law;
4) A Receiver or Trustee of the property of the Lessee
or the Guarantor under the Bankruptcy Code or any similar provisions
of any future federal bankruptcy law;
5) Any assignment for the benefit of creditors is made
of the Lessee's or Guarantor's property under state law.
21. TAXES ON LESSEE'S PROPERTY.
21.1 Lessee shall be liable for and shall pay at least ten (10)
days before delinquency, taxes levied against any personal property or
trade fixtures placed by Lessee in or about the Premises. If any such
taxes on Lessee's personal property, or trade fixtures are levied
against Lessor or Lessor's property or if the assessed value of the
Premises is increased by the inclusion therein of a value placed upon
such personal property or trade fixtures of Lessee, then Lessor shall
have the right to pay the taxes based upon such increased assessments,
regardless of the validity thereof, but only under proper protest if
requested by Lessee in writing. If Lessor shall do so, then Lessee
shall, upon demand, repay to Lessor the taxes levied against Lessor,
or the proportion of such taxes resulting from such increase in the
assessment. In any such event, Lessee, at Lessee's sole cost and
expense, shall have the right, in the name of Lessor and with Lessor's
full cooperation, to bring suit in any court of competent jurisdiction
to recover the amount of any such taxes so paid under protest, any
amount so recovered to belong to Lessee.
21.2 If the Leasehold Improvements in the Premises, whether
installed and/or paid for by Lessor or Lessee and whether or not
affixed to the real property so as to become a part thereof, are
assessed for real property tax purposes at a valuation higher than the
valuation of which Leasehold Improvements conforming to Lessor's
"Building Standard" in other space in the Building are assessed, then
the real property taxes and assessments levied against Lessor or the
property by reason of such excess assessed valuation shall be deemed
to be property taxes and assessments levied against personal property
of Lessee and shall be governed by the provisions of Subparagraph
21.1, above. If the records of the County Assessor are available and
sufficiently detailed to serve as a basis for determining whether said
Leasehold Improvements are assessed at a higher valuation than
Lessor's "Building Standard", such records shall be binding on both
Lessor and Lessee. If the records of the county Assessor are not
available or sufficiently detailed to serve as a basis for making said
determination, the actual costs of construction shall be used. All
sums payable to Lessor under this Paragraph shall be deemed to be
rents.
22. HOLDING OVER. In the event the Lessee remains in the possession
of the Leased Premises or any part thereof after the end of the term
with or without the expressed written consent of Lessor but without
the execution and delivery of a new Lease, there shall be no implied
or tacit renewal of this Lease or the term granted hereby and the
Lessee shall be deemed to be occupying the Leased Premises as a tenant
from month to month, at a monthly rate payable in advance on the first
day of each month, without grace, equal to twice the rent due for the
last month of the Lease Term, together with a proportionate share of
the expenses, operating costs and other rent as set forth in Paragraph
5 herein, and otherwise upon the same terms, conditions and provisions
set forth in this Lease insofar as the same are applicable to a month-
to-month tenancy. Acceptance by Lessor of rent after such expiration
or earlier termination shall not constitute a holdover hereunder or
result in a renewal. The foregoing provisions of this Paragraph are
in addition to and do not affect Lessor's right of re-entry or any
rights of Lessor hereunder or as otherwise provided by law. If Lessee
fails to surrender the Premises upon the expiration of this Lease
despite demand to do so by Lessor, Lessee shall indemnify and hold
Lessor harmless from all loss or liability, including without
limitation, any claim made by any succeeding tenant founded on or
resulting from such failure to surrender and any attorneys' fees and
costs and any loss or damage occasioned by Lessor for failure to
deliver Premises which are proximately caused by Lessee's holding
over.
23. SECURITY DEPOSIT. Upon the execution hereof, Lessee has
deposited with the Lessor a security deposit in the sum shown in
Paragraph 1.1 herein. Said sum shall be held as security for the
full, faithful and timely performance of the terms, covenants, and
conditions of this Lease. In the event of default by Lessee in the
performance of any of the covenants, agreements or conditions by it to
be kept and performed hereunder, Lessor may, at its sole election,
without notice and without terminating this Lease, apply the funds so
deposited in payment or rent or other sums due hereunder or in
remedying any other default hereunder, or for the payment of any
amount which Lessor may spend or become obligated to spend by reason
of Lessee's default, or to compensate Lessor for any other loss, cost,
damage or expense (including attorney or other professional service
fees) which Lessor may suffer or incur by reason of Lessee's default,
or Lessor may terminate this Lease by reason of any such default and
retain said funds as partial damages for any such default and not by
way of penalty, nor shall such liquidated damages be an offset to
actual damages incurred by Lessor. Lessee agrees that upon the
application by Lessor of funds so deposited, Lessee shall pay Lessor,
within five (5) days of demand, the amount so applied which shall be
added to the unapplied funds so the funds deposited will be restored
to their original amount. Lessee's failure to do so shall be a
material breach under this Lease. Any action taken by Lessor under
this Paragraph shall not be construed to be a waiver of any of its
rights under this Lease or of its rights in case of subsequent default
to enforce any remedy available to Lessor by law or under the
provisions of this Lease, including the remedies set forth in this
Paragraph. Within sixty (60) days after the expiration of the tenancy
hereby created, whether by lapse of time or otherwise, provided Lessee
shall not at any time have been in default hereunder during the terms
of the Lease, and shall have complied with all the terms, covenants
and conditions of this Lease, and shall have fully, faithfully and
timely performed each and every provision of this Lease to be
performed, including the yielding up to the immediate possession to
Lessor, Lessor shall upon being furnished with affidavits and other
satisfactory evidence by Lessee that Lessee has paid all bills
incurred by it in connection with its performance of the terms,
covenants and conditions of this Lease, return to Lessee said sum on
deposit or such portion thereof then remaining on deposit with Lessor
hereunder; provided, that in the event this Lease shall be terminated
by or upon default of, the Lessee, the security deposit shall be
retained by Lessor, and the security deposit shall be forfeited by
Lessee, and all of Lessee's interest therein shall terminate; Provided
further, that Lessor may retain the security deposit until such time
as any amount due from Lessee in accordance with Paragraph 5 hereof
has been determined and paid in full. Should Lessor sell its
interests in the Premises during the term hereof and if Lessor
deposits with the purchaser thereof the then unappropriated funds
deposited by Lessee as aforesaid, or is credited therefore in the
purchase agreement, thereupon Lessor shall be discharged from any
further liability with respect to such security deposit.
24. SIGNS, DISPLAYS, AUCTIONS, AND SALES.
24.1 General. Lessee shall not place or suffer to be placed on
the exterior walls or windows of the Premises or upon the roof or any
exterior door or wall or on the exterior or interior of any window
thereof any sign, awning, canopy, marquee, advertising matter,
decoration, picture, letter or other thing of any kind (exclusive of
the signs, if any, which may be provided for in the original
construction or improvement plans and specifications approved by the
Lessor hereunder, and which conform to the Lessor's sign criteria)
without the prior written consent of Lessor. Lessor hereby reserves
the exclusive right to the use for any purpose whatsoever of the roof
and exterior of the walls of the Premises or the building of which the
Premises are a part. In the event Lessee shall install any sign which
does not meet the Lessor's sign criteria, Lessor shall have the right
and authority without liability to Lessee to enter upon the Premises,
remove and store the subject sign and repair all damage caused by the
removal of the sign. All costs and expenses incurred by Lessor shall
be immediately paid by Lessee as additional rent. The Lessor reserves
the right to remove the Lessee's sign during any period when Lessor
repairs, restores, constructs or renovates the Premises or the
Building of which the Premises is a part.
24.2 Lessee's Interior Signs. Except as otherwise herein
provided, Lessee shall have the right, at its sole cost and expense,
to erect and maintain within the interior of the Premises all signs
and advertising matter customary or appropriate in the conduct of
Lessee's business; provided, however, that Lessee shall upon demand of
the Lessor immediately remove any sign, advertisement, decoration,
lettering or notice which Lessee has placed or permitted to be placed
in, upon or about the Premises and which Lessor reasonably deems
objectionable or offensive, and if Lessee fails or refuses to so do,
the Lessor may enter upon the Premises and remove the same at Lessee's
cost and expense. In this connection, Lessee acknowledges that the
Premises are a part of an integrated business environment, and agrees
that control of all signs by Lessor is essential to the maintenance of
uniformity, propriety and the aesthetic values in or pertaining to the
Building.
24.3 All authorized signs shall be at the provided and
maintained expense of Lessee, including permits, license fees, and
compliance with any sign ordinance is solely the Lessee's
responsibility and shall be removed at Lessee's expense prior to
termination of tenancy with the Building being fully restored.
24.4 The Lessee may not display or sell merchandise or allow
carts or other similar devices within the control of Lessee to be
stored or to remain outside the defined demising walls and permanent
doorways of the Premises. Lessee further agrees not to install any
exterior lighting, amplifiers, or similar devices or use in or about
the Premises such items as flashing lights, searchlights,
loudspeakers, phonographs or radio broadcasts, nor to make, or allow
to be made, any odor or excessive noise in or around the Premises. It
is understood and agreed that no advertisement or sound of advertising
shall be heard outside of the Premises.
24.5 Lessee shall not conduct or permit to be conducted any sale
by auction upon or from the Premises, whether said auction be
voluntary, involuntary, pursuant to any assignment for the payment of
creditors or pursuant to any bankruptcy or other insolvency
proceeding. No auction, fire, bankruptcy, "going out of business" or
other distress sales of any nature may be conducted on the Premises
without prior written consent of Lessor, which consent may be
conditioned as Lessor deems appropriate.
25. RULES AND REGULATIONS. Lessee for the use and benefit of Lessee,
its agents, employees, servants, customers, licensees and subtenants
will at all times observe, perform and abide by all rules and
regulations contained herein, and/or which may be from time to time
hereafter promulgated by Lessor, all of which, it is covenanted and
agreed by the parties hereto, shall be and are hereby made a part of
this Lease. Lessor shall not be responsible to Lessee for the
nonperformance of any said rules and regulations by any other tenants
or occupants. Such rules and regulations shall be binding on the
Lessee upon delivery of a copy of them to Lessee, and thereupon shall
be deemed incorporated as though fully set forth herein, and shall be
subject to all rights and remedies of Lessor for Lessee's failure to
observe said rules, said failure being a material breach hereof.
26. SUBORDINATION. Without the necessity of any additional document
being executed by Lessee for the purpose of effecting a subordination,
and at the election of Lessor or any first mortgagee with a lien on
the Building or any ground lessor with respect to the Building, this
Lease shall be subject and subordinate at all times to: (a) all
ground leases or underlying leases which may now exist or hereafter be
executed affecting the Building or the land upon which the Building is
situated or both, and (b) the lien of any mortgage or deed of trust
which may now exist or hereafter be executed in any amount for which
the Building, land, ground leases, or underlying leases, or Lessor's
interest or estate in any of said items is specified as security.
Notwithstanding the foregoing, Lessor shall have the right to
subordinate or cause to be subordinated any such ground leases or
underlying leases or any such liens to this Lease. In the event that
any ground lease or underlying lease terminates for any reason or any
mortgage or deed of trust is foreclosed or a conveyance in lieu of
foreclosure is made for any reason, Lessee shall, notwithstanding any
subordination, attorn to and become the Lessee of the successor in
interest to Lessor, at the option of such successor in interest.
Lessee covenants and agrees to execute and deliver, upon demand by
Lessor and in the form requested by Lessor, any additional documents
evidencing the priority or subordination of this Lease with respect to
any such ground leases or underlying leases or the lien of any such
mortgage or deed of trust and hereby irrevocably appoints Lessor as
attorney-in-fact of Lessee to execute, deliver and record any such
document in the name and on behalf of Lessee. Failure of Lessee to
execute such documents upon ten (10) days request by Lessor shall
constitute a material breach hereunder.
27. LESSEE'S STATEMENT AND ESTOPPEL CERTIFICATE. Lessee shall, at
any time upon not less than three (3) days prior written notice from
Lessor, execute, acknowledge and deliver to Lessor a statement in
writing certifying that this Lease is unmodified and in full force and
effect, or, if modified, is in full force and effect and the date to
which the rent and other charges are paid in advance, if any, and
acknowledging that there are not, to Lessee's knowledge, any uncured
defaults on the part of Lessor hereunder, or specifying such defaults,
if any are claimed. Any such statement may be conclusively relied
upon by Lessee and any prospective purchaser or encumbrancer of the
property of which the Leased Premises are a part, and such statement
may be prepared by or on behalf of said purchaser or encumbrance.
Lessee's failure to deliver (but Lessee shall not be relieved from
deliver) such statement within such time shall be conclusive upon
Lessee that this Lease is in full force and effect, without
modification except as may be represented by Lessor, that there are no
uncured defaults in Lessor's performance, and that not more than one
(1) month's rent has been paid in advance, and other matters which may
be reasonably requested by Lessor or Lender. Failure to deliver may
be considered by Lessor at its election as a default by Lessee under
this Lease. If Lessor desires to finance or refinance the Premises,
or any part thereof, Lessee hereby agrees to deliver to any lender
designated by Lessor such financial information of Lessee as shall be
required by such lender. All such information shall be received in
confidence and shall be used only for the purpose herein set forth.
28. ARBITRATION OF DISPUTES. Lessee agrees that at Lessor's option,
any dispute, controversy or claim arising out of or in connection
with, or relating to, this Agreement, its interpretation, application,
or the rights, duties or liabilities hereunder of either party, or any
breach or alleged breach hereof, which the Lessee and Lessor are
unable to resolve between themselves, shall, upon the written request
of any party involved, be submitted to, and settled by, binding
arbitration in the city where Premises is located or as agreed by the
parties, pursuant to the rules then in effect of the American
Arbitration Association (or at any other place or under any other form
of arbitration mutually acceptable to the parties so involved). An
arbitrator shall be selected by mutual agreement of the disagreeing
parties, or, such mutual agreement not having been reached fifteen
(15) days after the written request for arbitration by any party, then
each party will appoint one arbitrator, and the two appointed
arbitrators will select a third. In the event of the failure of
either party to appoint an arbitrator with the fifteen (15) day time
period, then the party seeking arbitration may cause an appointment to
be made on behalf of said party not having designated an arbitrator by
the current Presiding Judge of the Superior Court of the State of
Washington for the county in which the Premises is located. If a
single arbitrator is mutually appointed by the parties, and if either
party disagrees with the arbitrator's conclusions and decisions, then
such disagreeing party may demand that a new panel will be appointed
within ten (10) days to arbitrate the dispute de novo. The method of
appointment shall be as provided above. The party requesting the new
arbitration shall bear the expense of costs and attorney fees incurred
by both parties in the de novo proceedings, except that the panel
shall have the discretion to award reasonable costs and reasonable
attorney fees to either party based on the outcome of the de novo
proceedings. Any award rendered shall be final, binding and
conclusive upon the parties and a judgment thereon may be entered in
the highest court of the forum, state or federal, having jurisdiction.
Except in the case of a de novo arbitration as above provided, the
expenses of the arbitration shall be borne equally by the parties to
the arbitration, and each party shall pay for and bear the cost of its
own experts, evidence and counsel's fees, except that in the
discretion of the arbitrator any award may include the cost of a
nondefaulting party's counsel and costs if the arbitrator expressly
determines that the party against whom such award is entered has
caused the dispute, controversy or claim, or if a claim is submitted
to arbitration as a dilatory tactic. Costs and attorneys' fees
related to all proceedings may be awarded by the court to the
prevailing party if for any reason litigation or appeal ensues.
29. BUILDING PLANNING. In the event Lessor requires the Premises for
use in conjunction with another suite or for other reasons connected
with the Building planning program, upon notifying Lessee in writing,
Lessor shall have the right to move Lessee to other space in the
project of which the Premises forms a part, at Lessor's sole cost and
expense, and the terms and conditions of the original Lease shall
remain in full force and effect, save and excepting that a revised
Exhibit "D" shall become part of this Lease and shall reflect the
location of the new space and Paragraph 1 of this Lease shall be
amended to include and state all correct data as to the new space.
However, if the new space does not meet with the Lessee's approval,
which shall not be unreasonably withheld, Lessee shall have the right
to cancel said Lease upon giving Lessor thirty (30) days' notice
within ten (10) days of receipt of Lessor's notification.
30. PERFORMANCE BY LESSEE. All covenants and agreements to be
performed by Lessee under any of the terms of this Lease shall be
performed by Lessee at Lessee's sole cost and expense and without any
offset or abatement of rent. If Lessee shall fail to pay any sum of
money, other then Annual Basic Rent, required to be paid by it
hereunder or shall fail to perform any other act on its part to be
performed hereunder, and such failure shall continue for ten (10) days
after notice thereof by Lessor, Lessor may, without waiving or
releasing Lessee from obligations of Lessee, but shall not be
obligated to, make any such payment or perform any such other act on
Lessee's part to be made or performed as in this Lease provided all
sums so paid by Lessor and all necessary incidental costs together
with interest thereon at one and one-half (1-1/2) percent interest
monthly but in no event to exceed the maximum rate permissible by law,
from the date of such payment by Lessor, shall be payable to Lessor on
demand. Lessee covenants to pay any such sums, and all sums so paid
an expenses incurred by Lessor, together with late charges thereon,
shall become additional rent and be paid by Lessee upon demand.
Lessee shall have (in addition to any other right or remedy of Lessor)
the same rights and remedies in the event of the non-payment thereof
by Lessee as in the case of default by Lessee in the payment of the
Annual Basic Rent.
31. MORTGAGEE PROTECTION. In the event of any default on the part
of Lessor, Lessee will give notice by registered or certified mail to
any beneficiary of a deed of trust or mortgage covering the Premises,
and shall offer such beneficiary or mortgagee a reasonable opportunity
to cure the default, including time to obtain possession of the
Premises by power of sale or a judicial foreclosure, if such should
prove necessary to effect a cure.
32. NON-WAIVER OF BREACH. No waiver of any term, covenant or
condition or legal right or remedy shall by implied by the failure of
Lessor to declare a forfeiture, or for any other reason, and no waiver
of any condition or covenant shall be valid unless it be in writing
signed by Lessor. No waiver by Lessor in respect to one or more
tenants or occupants of the Building in which the Premises are located
shall constitute a waiver in favor of Lessee, nor shall the waiver of
a breach of any term, covenant or condition by claimed or pleaded to
cause a future breach of the same term, covenant or condition, nor
shall any custom or practice which may grow up between the parties in
the administration of the terms hereof be deemed a waiver of or in any
way affect the rights of Lessor to insist upon the performance by
Lessee in strict accordance with said terms. The subsequent
acceptance of rent hereunder by Lessor shall not be deemed to be a
waiver of any preceding breach by Lessee of any term, covenant or
condition of this Lease, other than the failure of Lessee to pay the
particular rent so accepted, regardless of Lessor's knowledge of such
preceding breach at the time of acceptance of such rent. The mention
in this lease of any specific right or remedy shall not preclude
Lessor from exercising any other right or from having any other remedy
or from maintaining any action to which it may be otherwise entitled
either at law or in equity; and for any purpose of any suit by Lessor
brought or based on this Lease, this Lease shall be construe to be a
divisible contract, to the end that at Lessor's elections, successive
actions may be maintained as successive periodic sums shall mature
under this Lease and it is further agreed that failure to include in
any suit or action any sum or sums then matured shall not be a bar to
the maintenance of any suit or actions for the recovering of said sum
or sums so omitted.
33. DEFINITION OF LESSOR. The term "Lessor" as used in this Lease,
so far as covenants or obligations on the part of Lessor are
concerned, shall be limited to mean and include only the owner or
owners, at the time in question, of the fee title of the Premises or
the Lessees under any ground lease, if any. In the event of any
transfer, assignment or other conveyance or transfers of any such
title, Lessor herein named (and in case of any subsequent transfers or
conveyances, the then grantor) shall be automatically freed and
relieved from and after the date of such transfer, assignment or
conveyance of all liability as respects the performance of any
covenants or obligations or omission thereof, on the part of Lessor
contained in this Lease, thereafter to be performed. Without further
agreement, the transferee of such title shall be deemed to have
assumed and agreed to observe and perform any and all obligations of
Lessor hereunder, during its ownership of the Premises. Lessor may
transfer its interest in the Premises without the consent of Lessee
and such transfer or subsequent transfer shall not be deemed violation
on Lessor's part of any of the terms and conditions in this Lease
including obligations respecting the return of any security deposit.
34. IDENTIFICATION OF LESSEE. If more than one person executes
this Lease as Lessee, (a) each of them is jointly and severally liable
for the keeping, observing and performing of all of the terms,
covenants, conditions, provisions and agreements of this Lease to be
kept, observed and performed by Lessee, and (b) the term "Lessee" as
used in this Lease shall mean and include each of them jointly and
severally. The act or notice from, or notice or refund to, or the
signature of any one or more of them, with respect to the tenancy of
this Lease, including, but not limited to any renewal, extension,
expiration, termination or modification of this Lease, shall be
finding upon each and all of the persons executing this Lease as
Lessee with the same force and effect as if each and all of them had
so acted or so given or received such notice or refund or so signed.
35. LESSOR'S RIGHT TO PERFORM. If Lessee shall at any time fail to
make payment or perform any act on its part to be made or performed
under this Lease, then Lessor without waiving or releasing Lessee from
any obligation contained in this Lease, may (but shall not be under
any obligation to do so) make said payments and/or perform said acts
and enter upon the Premises for said purpose. All sums so paid and
expenses incurred by Lessor together with late charges and interest
thereon as set forth in Paragraph 5.6 of this Lease shall become
additional rent and be paid by Lessee upon demand.
36. COSTS AND ATTORNEYS' FEES. If by reason of any default by
Lessee in the performance of any of the provisions of this Lease
(including failure to pay rent when due) and Lessor incurs any expense
by reason of such default, whether or not a legal cause of action is
filed, Lessee shall pay all costs, expenses and reasonable attorneys'
fees expended or incurred in connection therewith, including appeals.
Should Lessor be named as a defendant in any suit brought against
Lessee in connection with or arising out of Lessee's occupancy
hereunder, Lessee shall pay to Lessor its costs and expenses incurred
in such suit, including reasonable attorney's fees.
37. LIMITATION ON LIABILITY. In consideration of the benefits
accruing hereunder, Lessee and all successors and assigns covenants
and agree that, in the event of any actual or alleged failure, breach
or default hereunder by Lessor:
a. The sole and exclusive remedy shall be against the rent
reserved by this Lease accruing after any default or material breach
for satisfaction of any liability in respect to this Lease;
b. No partner of Lessor shall be sued or named as a party in
any suit or action (except as may be necessary to secure jurisdiction
of the partnership);
c. No service or process shall be made against any partner of
Lessor (except as may be necessary to secure jurisdiction of the
partnership);
d. No partner of Lessor shall be required to answer or
otherwise plead to any service of process;
e. No judgment will be taken against any partner of Lessor;
f. Any judgment taken against any partner of Lessor may be
vacated and set aside at any time nunc pro tunc;
g. No writ of execution will ever by levied against the assets
of any partner of Lessor;
h. These covenants and agreements are enforceable both by
Lessor and also by any partner of Lessor;
i. This Lease and the obligations of the Lessee hereunder shall
not be affected or impaired because the Lessor is unable to fulfill
any of its obligations hereunder, or is delayed in doing so, if such
liability or delay is caused by reason of strike, labor trouble,
inclement weather, war, riot, acts of God or any other cause beyond
the reasonable control of Lessor.
38. LEGAL EFFECT OF LEASE DOCUMENT. This Lease has been prepared
for submission to Lessee's attorney for independent legal counsel and
approval. No representation or recommendation is made by the Lessor,
real estate broker, agents or employees as to the legal sufficiency,
legal effect or tax consequences of this Lease or the transactions
relating thereto. LESSEE HEREBY REPRESENTS AND WARRANTS THAT THIS
DOCUMENT HAS BEEN READ IN ITS ENTIRETY AND LESSEE IS FULLY APPRISED
OF, AND UNDERSTANDS, THE CONTENTS HEREOF, TOGETHER WITH THE LEGAL
EFFECT OF THE LEASE, AND FULLY UNDERSTANDS THE RESPECTIVE RIGHTS AND
REMEDIES OF THE PARTIES.
39. ACCORD AND SATISFACTION. No payment by Lessee or receipt by
Lessor of a lesser amount than the rental or other items herein
stipulated shall be deemed to be other than on account of the earliest
stipulated rent or amount due, nor shall any endorsement or statement
on any check or any letter accompanying any check, or payment be
deemed an accord and satisfaction, and Lessor may accept such check or
payment without prejudice to Lessor's right to recover the balance of
such rent or other sums or pursue any other remedy provided for in
this Lease or available at law or in equity. Acceptance of rent from
another company or entity does not constitute lease agreement or
assignment.
40. MISCELLANEOUS PROVISIONS.
40.1 Successors or Assigns. Except as otherwise provided
herein, all the terms, conditions, covenants and agreements of this
Lease shall extend to and be binding upon Lessor, Lessee and their
respective heirs, administrators, executors, successors, subtenants,
sublessees, concessionaires, assigns and marital communities, if any,
and upon any person or persons coming into ownership or possession of
any interest in the Premises by operation of law or otherwise.
40.2 Governing Law. This Lease shall be governed by and construed
pursuant to the laws of the State of Washington.
40.3 Authority of Parties. If Lessee is a corporation, each
individual executing this Lease on behalf of said corporation
represents and warrants that he is duly authorized to execute and
deliver this Lease on behalf of said corporation in accordance with a
duly adopted resolution of the Board of Directors of said corporation
or in accordance with the bylaws of said corporation, and this Lease
is binding upon said corporation. Lessee shall, simultaneously with
the execution of this Lease, deliver to Lessor a certified copy of a
resolution of the Board of Directors of said corporation authorizing
or ratifying the execution of this Lease, and certified copies of
other corporation documents as may reasonably be requested by Lessor
or Lessor's Lender to authenticate the transaction. Any person
executing this instrument, its exhibits, addenda, extensions, or
renewals, or represents any material fact relevant hereto in writing,
warrants and represents that he/she is duly authorized to so act.
40.4 Interest on Past Due Obligations. Any amount due from
Lessee to Lessor hereunder which is not paid when due shall bear
interest at the rate of one and one half (1-1/2) percent per month
from the date due until paid, but the payment of such interest shall
not excuse or cure any default by Lessee, and interest shall be
compensation for the loss of Lessee's use of the past due funds, and
shall be in addition to late or delinquent charges which are
reimbursements for administrative costs associated with collecting and
processing such past due amounts. An administrative charge of $25.00
will be assessed for any check from Lessee which is returned for any
reason. In no event will interest be assessed in excess of the legal
limit.
40.5 Broker's Commission. The parties recognize that the
brokers who negotiated this Lease are the brokers whose names are
stated in Paragraph 1, and agree that Lessor shall be solely
responsible for the payment of brokerage commissions to said brokers,
and that Lessee shall have no responsibility therefore. If Lessee has
dealt with any other person or real estate broker with respect to
leasing or renting space in the Building, lessee shall be solely
responsible for the payment of any fee due said person or firm and
Lessee shall indemnify and hold Lessor harmless against any liability
in respect thereto, including attorney's fees and costs.
40.6 Terms and Headings. The words "Lessor" and "Lessee" as used
herein shall include the plural as well as the singular. Words used
in any gender include other genders. The Paragraph headings of this
Lease are not a part of this Lease and shall have no effect upon the
construction or interpretation of any part hereof.
40.7 Examination of Lease. Submission of this instrument for
examination or signature by Lessee does not constitute a reservation
of or option for Lease, and it is not effective as a Lease or
otherwise until complete execution by and delivery to both Lessor and
Lessee.
40.8 Time. Time is of the essence with respect to the
performance of every provision of this Lease in which time or
performance is a factor.
40.9 Prior Agreement: Amendments. 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
provisions 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.
40.10 Partial Invalidity. If any term, covenant, or
condition of this Lease or the application thereof to any person or
circumstance is, to any extent, invalid or unenforceable, the
remainder of this Lease, or the application of such terms, covenant or
condition to persons or circumstances other than those as to which it
is held invalid or unenforceable, shall not be affected thereby and
each term, covenant or condition of this Lease shall be valid and be
enforced to the fullest extent permitted by law.
40.11 Recording. Lessee shall not record or file this Lease,
or any assignment or security document pertaining to this Lease or all
or any part of Lessee's interest therein without the prior written
consent of Lessor, which consent may be subject to such conditions as
Lessor shall deem appropriate. However, upon the request of Lessor,
both parties shall execute a memorandum or "short form" of this Lease
for the purposes of recordation in a form customarily used for such
purposes. Said memorandum or short form of this Lease shall describe
the parties, the Premises and the Lease Term and shall incorporate
this Lease by reference.
40.12 Notices. Any notices required in accordance with any
of the provisions herein or desired to be given hereunder, if to
Lessor shall be delivered personally or if mailed then mailed by
registered or certified mail and addressed to the address of Lessor as
set forth in Paragraph 1 or at such other place as Lessor may in
writing from time to time direct to Lessee, and if to Lessee shall be
delivered personally or if mailed then mailed by registered or
certified mail and addressed to Lessee at the Premises. If there is
more than one Lessee, any notice required or permitted hereunder may
be given by or to any one thereof, and shall have the same force and
effect as if given by or to all thereof. Notices shall be deemed
given when delivered, if delivered personally, or two (2) business
days after deposit in the United States mail as set forth above.
40.13 Plats and Riders. Clauses, plats, riders, Exhibits and
addendums, if any, signed by Lessee and Lessor, affixed to this Lease
are incorporated herein and made a part hereof.
40.14 Lessee's Representation and Warranties. Lessor has
made no representations or promises except as contained herein or in
some further writings signed by Lessor. Financial statements and
other information furnished by the Lessee are hereby warranted to be
true and accurate by Lessee, and such representations and warranties
shall survive the execution and termination of this Lease and are
material consideration relied upon by Lessor in executing this Lease.
Any false, misleading or inaccurate statement by Lessee is a material
breach and an event of default hereunder.
40.15 Acceptance of Keys. The acceptance of keys to the
Premises by the Lessor, its agents, employees, contractors or any
other person on Lessor's behalf shall not be deemed or constitute a
termination of this Lease unless such termination is evidenced in
writing signed by the Lessor.
40.16 Lessee and Lessee's Employees Parking. Lessee and
Lessee's agents and employees shall park only in those areas
designated by Lessor or Lessor's agents. Lessee shall pay a fine to
Lessor of $20.00 per violation for each parking violation of Lessee,
Lessee's employees, agents, or licensees.
40.17 Prior Agreements. This Lease contains all of the oral
and written agreements and understandings, correspondence,
representations and statements of the parties hereto with respect to
any matter covered or mentioned in this Lease, and no prior oral or
written agreements or understanding pertaining to any such matters
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. This Lease
shall not be effective or binding on any party until fully executed by
both parties hereto. Lessee warrants that it has read this agreement
in its entirety and understands the provisions, rights, remedies,
covenants, duties and liabilities provided herein. LESSEE EXPRESSLY
WARRANTS THAT IT FULLY UNDERSTANDS THE PROVISIONS CONTAINED IN SECTION
17 REGARDING DEFAULT, ENTRY, AND DAMAGES.
Lessee agrees that each of the terms, covenants, and conditions
contained herein shall be applicable to any covenant or agreement
either expressly contained in this Lease or imposed by any statute or
at common law.
IN WITNESS WHEREOF, the parties hereto have executed this lease
as of the day and year first above written.
LESSOR: LESSEE:
LCTR L.L.C. Chicago Pizza
Northwest, Inc., a Washington
Corporation
By:__/s/Xxxxxx Gregory_________ By:__/s/Xxxxx David_________
By:_________________________
Title:______VP______________
Title:____Manager________
Date:____3-4-97________________ Date:__2-25-97_______________
Date:_______________________
STATE OF WASHINGTON)
)ss.
County of SNOHOMISH)
On this ___4th______ day of ____March_____________, 19_____,
before me personally appeared _/s/Xxxxxx X. Gregory_____ to me known
to be the individual described in and who executed the within and
foregoing instrument as the Manager on behalf of LCTR L.L.C., a
Washington Limited Liability Company and deed of said Partnership for
the uses and purposes therein mentioned, and on oath stated that he
was authorized to execute said instrument on behalf of said Limited
Liability Company.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year first above written.
______/s/Xxx X. Roe_____________________________
Notary Public in and for the State of Washington,
residing at _Edmonds, WA________________________
(Acknowledgement for Corporate Lessee)
STATE OF WASHINGTON)
)ss.
County of SNOHOMISH)
On this ____________ day of ______________________, 19_____,
before me personally appeared ______________________________ and
______________________________ to me known to be the
______________________________ and _____________________________,
respectively of Chicago Pizza & Brewery, Inc., the corporation that
executed the within and foregoing instrument, and therein mentioned,
and on oath stated that he/they was/were authorized to execute said
instrument, and that the seal affixed is the corporate seal of said
corporation.
_________________________________________________
Notary Public in and for the State of Washington,
residing at _____________________________________
(Acknowledgement for Corporate Lessee)
STATE OF WASHINGTON)
)ss.
County of KING)
On this ___25th__ day of __February______, 1997__, before me
personally appeared __/s/Xxxxx X. Xxxxx _____________ and
______________________________ to me known to be the __Vice
President______________ and _____________________________,
respectively of Chicago Pizza Northwest, Inc., the corporation that
executed the within and foregoing instrument, and therein mentioned,
and on oath stated that he/they was/were authorized to execute said
instrument, and that the seal affixed is the corporate seal of said
corporation.
____/s/Xxxx X. Blay______________________________
Notary Public in and for the State of Washington,
residing at __Lynnwood, WA ______________________
My commission expires 00-0-00
XXXXXXX "X"
Xxxx letter Agreement
Except for the specific items described herein, the Premises are
delivered and accepted "where is" and "as is". The unit will be
thoroughly cleaned. The walls will be repaired and painted where
necessary, subject to an inspection by the Tenant and Landlord
following completion of said work. One door will be installed to
provide access to the northerly-most office.
ACCEPTED:
LESSEE: LESSOR:
CHICAGO PIZZA NORTHWEST, INC. LCTR, L.L.C.
By:__/s/Xxxxxx Gregory______________
By:__/s/Xxxxx David______________
Title:_Manager___________________
Title:____VP____________________
Date:___3-4-97___________________ Date:__2-24-97
EXHIBIT D
(Floor Plan)
EXHIBIT "E"
Acceptance Letter
LCTR L.L.C.
00000 - 00xx Xxx. X.
Xxxxx 000
Xxxxxxxx, XX 00000
RE: Lease Dated:
Lessor: LCTR L.L.C.
Lessee: Chicago Pizza & Brewery, Inc.
Chicago Pizza Northwest, Inc.
Premises: Suite _______
Gentlemen:
The undersigned, tenant under the above-described Lease, hereby
confirms, as of the date hereof, the following:
1. That it is in full and complete possession of the Demised
Premises, such possession having been delivered by Lessor and having
been accepted by the undersigned.
2. That the improvements and space required to be furnished by the
Terms of the lease have been completed in all respects to the
satisfaction of the undersigned and are open for the use of, the
undersigned, its employees and invitees.
3. That all duties of an inducement nature required of Lessor in
said Lease have been fulfilled.
4. That said Lease is in full force and effect; that there are no
existing defaults on the part of the Lessor under the terms thereof.
5. That said Lease has not been amended, modified, supplemented or
superseded except as follows:
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
___________________________________
6. That no rents have been prepaid except as provided by said Lease.
7. That undersigned has received no notice of prior sale, transfer,
assignment, hypothecation or pledge of the said Lease or of the rents
secured herein, except to you.
8. The rents provided in said Lease commenced to accrue on the
___________ day of _____________________, 19_____.
Very truly yours,
_________________________________________________________
(Tenant)
By:___________________________________________________
(Title)
EXHIBIT "F"
GUARANTEE OF LEASE
In consideration of, and as an inducement for the granting execution
and delivery of that certain Lease, covering Premises located at 00000
- 00xx Xxxxxx Xxxx, and as described in attached Exhibit "A", dated
February 20, 1997 (hereinafter called the "Lease"), between LCTR
L.L.C., the Lessor therein named (hereinafter called "Lessor") and
Chicago Pizza & Brewery, Inc., Chicago Pizza Northwest, Inc, the
Lessee therein named (hereinafter called "Lessee"), and in further
consideration of the sum or One Dollar ($1.00), and other good and
valuable consideration paid by the Lessor to the undersigned, the
undersigned, (hereinafter called the "Guarantor"), hereby guarantees
to the Lessor, its successors and assigns, the full and prompt payment
of rent, including, but not limited to, the fixed minimum rent, common
area charge, utility charge, if applicable, and any and all other sums
and charges payable by the Lessee, its successors and assigns under
said Lease; and the full performance and observance of all the
covenants, terms, conditions and agreements therein provided to be
performed and observed by the Lessee, its successors and assigns; and
the Guarantor hereby covenants and agrees to and with the Lessor, its
successors and assigns; that if default shall at any time be made by
the Lessee, its successors and assigns, in the payment of any such
sums, or in the performance of any of the terms, covenants, provisions
or conditions contained in said Lease, the Guarantor shall forthwith
pay such rent to the Lessor, its successors and assigns, and any
arrears thereof, and will forthwith faithfully perform and fulfill all
of such terms, covenants, conditions and provisions, and will
forthwith pay to the Lessor all damages that may arise in consequence
of any default by the Lessee, its successors and assigns, under said
Lease, including, without limitation, all reasonable attorney's fees
and costs incurred by the Lessor or caused by any such default and by
the enforcement of this Guarantee.
This Guarantee is an absolute and unconditional Guarantee of payment
and of performance. It shall be enforceable against the Guarantor,
its successors and assigns, without the necessity of any suit or
proceedings on the Lessor's part of any kind or nature whatsoever
against the Lessee, its successors and assigns, and without the
necessity of any notice of non-payment, non-performance or non-
observance or of any notice of acceptance of this Guarantee, or of any
other notice or demand to which the Guarantor might otherwise be
entitled, all of which the Guarantor hereby expressly waives; and the
Guarantor hereby expressly agrees that the validity of this Guarantee
and the obligations of the Guarantor hereunder shall in no way be
terminated, affected or impaired by reason of assertion or the failure
to assert by the Lessor against the Lessee, or the Lessee's successors
and assigns, of any of the rights or remedies reserved to the Lessor
pursuant to the provisions of the said Lease.
The Guarantee shall be a continuing Guarantee, and the liability of
the Guarantor hereunder shall in no way be affected, modified or
diminished by reason of any assignment, renewal, modification or
extension of the Lease or by reason of any modification or waiver of
or change in any of the terms, covenants, conditions or provisions of
said Lease, or by reason of any extension of time that may be granted
by the Lessor to the Lessee, its successors and assigns, or by reason
of any dealings or transactions or matter or things occurring between
the Lessor and the Lessee, its successors and assigns, whether or not
notice thereof is given to the Guarantor.
The Guarantor further represents and warrants to the Lessor, as an
inducement for it to make the Lease, that the Guarantor has a
financial interest in the Lessee and that the execution and delivery
of this Guarantee is not in contravention of its charter or by-laws
and has been duly authorized by its Board of Directors.
All of the Lessor's rights and remedies under the said Lease or under
this Guarantee are intended to be distinct, separate and cumulative
and no such right and remedy therein or herein mentioned is intended
to be in exclusion of or a waiver of any of the others.
Notwithstanding the above provisions herein, this guarantee is limited
to those periods when Lessee's financial condition is worse (or less)
than the condition reflected in its December 31, 1996 year-end audited
financial statements prepared by Lessee's independent auditor.
Guarantor also agrees to place Lessor's name and mailing address on
its permanent list for distribution of its financial statements at
least on a quarterly basis and its periodic reports to stockholders.
GUARANTOR: CHICAGO PIZZA & BREWERY, INC.
A California Corporation
By:_____/s/Xxxxxxx Junginger_______________________
Date___3/5/97_______
Printed Signature:___William Junginger ______________
Title:___Controller ________________________________
(Acknowledgement for Corporate Lessee)
STATE OF WASHINGTON)
)ss.
County of SNOHOMISH)
On this ____5th_____ day of March, 1997, before me personally
appeared XXXXXXX JUNGINER to me known to be the controller of CHICAGO
PIZZA NORTHWEST, INC., the corporation that executed the within and
foregoing instrument, and therein mentioned, and on oath stated that
he/they was/were authorized to execute said instrument, and that the
seal affixed is the corporate seal of said corporation.
_____/s/Xxxx X. Xxxx _______________________________
Notary Public in and for the State of Washington,
residing at __Lynnwood______________________________
My commission expires 12-4-97
EXHIBIT "G"
Standards for Utilities and Service
The following Standards for Utilities and Services are in effect.
Lessor reserves the right to adopt nondiscriminatory modifications and
additions hereto:
As long as Lessee is not in default under any of the terms, covenants,
conditions, provisions or agreements of this Lease, Lessor shall:
a. Provide non-attended automatic elevator facilities Monday through
Friday, except holidays, from 8 A.M. to 6 P.M., and have one elevator
available at all other times.
b. On Monday through Friday, except holidays, from 8 A.M. to 6 P.M.
(and other times for a reasonable additional charge to be fixed by
Lessor), ventilate the Premises and furnish air conditioning or
heating on such days and hours, when in the judgment of Lessor it may
be required for the comfortable occupancy of the premises. The air
conditioning system achieves maximum cooling when the window coverings
are closed. Lessor shall not be responsible for room temperatures if
Lessee does not keep all window coverings in the Premises closed
whenever the system is in operation. Lessee agrees to cooperate fully
at all times with Lessor, and to abide by all regulations and
requirements which Lessor may prescribe for the proper function and
protection of said air conditioning system. Lessee agrees not to
connect any apparatus, device, conduit or pipe to the Building chilled
and hot water air conditioning supply lines. Lessee further agrees
that neither Lessee nor its servants, employees, agents, visitors,
licensees or contractors shall at any time enter mechanical
installations or facilities of the Building or adjust, tamper with,
touch or otherwise in any manner affect said installations or
facilities.
x. Xxxxxx shall furnish to the Premises, during the usual business
hours on business days, electric current as required by the Building
standard office lighting and fractional horsepower office business
machines in the amount of approximately two and one-half (2.5) xxxxx
per square foot. Lessee agrees, should its electrical installation or
electrical consumption be in excess of the aforesaid quantity or
extend beyond normal business hours, to reimburse Lessor monthly for
the measured consumption at the terms, classifications and rates
charged to similar consumers by said public utility serving the
neighborhood in which the Building is located. If a separate meter is
not installed at Lessee's cost, such excess cost will be established
by an estimate agreed upon by Lessor and Lessee, and if the parties
fail to agree, as established by an independent licensed engineer.
Lessee agrees not to use any apparatus or device in, or upon, or about
the premises which may in any way increase the amount of such services
usually furnished or supplied to said Premises, and Lessee further
agrees not to connect any apparatus or device with wires, conduits or
pipes, or other means by which such services are supplied, for the
purpose of using additional or unusual amounts of such services
without written consent of Lessor. Should Lessee use the same to
excess, the refusal on the part of Lessee to pay upon demand of Lessor
the amount established by Lessor for such excess charge shall
constitute a breach of the obligation to pay rent under this Lease and
shall entitle Lessor to the rights therein granted for such breach.
At all times Lessee's use of electric current shall never exceed the
capacity of the feeders to the Building or the risers or wiring
installation and Lessee shall not install or use or permit the
installation or use of any computer or electronic data processing
equipment in the Premises without the prior written consent of Lessor.
d. Water will be available in public areas for drinking and lavatory
purposes only, but if Lessee requires, uses or consumes water for any
purposes in addition to ordinary drinking and lavatory purposes of
which fact Lessee constitutes Lessor to be the sole judge, Lessor may
install a water meter and thereby measure Lessee's water consumption
for all purposes. Lessee shall pay Lessor for the cost of the meter
and the cost of the installation thereof and throughout the duration
of Lessee's occupancy Lessee shall keep said meter and installation
equipment in good working order and repair at Lessee's own cost and
expenses, in default of which Lessor may cause such meter and
equipment to be replaced or repaired and collect the cost thereof from
Lessee. Lessee agrees to pay for water consumed, as shown on said
meter, as and when bills are rendered, and on default in making such
payment, Lessor may pay such charges and collect the same from Lessee.
Any such costs or expenses incurred, or payments made by Lessor for
any of the reasons or purposes hereinabove stated shall be deemed to
be additional rent payable by Lessee and collectible by Lessor as
such.
e. Provide janitor service to the Premises, provided the same are
used exclusively as offices, and are kept reasonably in order by
Lessee, and if to be kept clean by Lessee, no one other than persons
approved by Lessor shall be permitted to enter the Premises for such
purposes. If the Premises are not used exclusively as offices, they
shall be kept clean and in order by Lessee, at Lessee's expense and to
the satisfaction of Lessor, and by persons approved by Lessor. Lessee
shall pay to Lessor the cost of removal of any of Lessee's refuse and
rubbish, to the extent that the same exceeds the refuse and rubbish
usually attendant upon the use of the Premises as offices.
Lessor reserves the right to stop service of the elevator, plumbing,
ventilation, air conditioning and electric systems, when necessary, by
reason of accident or emergency or for repairs, alterations or
improvements, in the judgment of Lessor desirable or necessary to be
made, until said repairs, alterations or improvements shall have been
completed, and shall further have no responsibility or liability for
failure to supply elevator facilities, plumbing, ventilating, air
conditioning or electric service, when prevented from so doing by
strike or accident or by any cause beyond Lessor's reasonable control,
or by laws, rules, orders, ordinances, directions, regulations or
requirements of any federal, state, county or municipal authority or
failure of gas, oil, or other suitable fuel supply or inability by
exercise of reasonable diligence to obtain gas, oil or other suitable
fuel. It is expressly understood and agreed that any covenants on
Lessor's part to furnish any service pursuant to any of the terms,
covenant, conditions, provisions or agreements of this Lease, or to
perform any act or thing for the benefit of Lessee shall not be deemed
breach if Lessor's unable to furnish or perform the same by virtue of
a strike or labor trouble or any other cause whatsoever beyond
Lessor's control.
RULES AND REGULATIONS
1. No sign, placard, picture, advertisement, name or notice shall be
installed or displayed on any part of the outside or inside of the
Building without the prior written consent of the Lessor. Lessor
shall have the right to remove, at Lessee's expense and without
notice, any sign installed or displayed in violation of this rule.
All approved signs or lettering on doors and walls shall be printed,
painted, affixed or inscribed at the expense of Lessee by a person
chosen by Lessor.
2. If Lessor objects in writing to any curtains, blinds, shades,
screens or hanging plants or other similar objects attached to or used
in connection with any window or door of the Premises, Lessee shall
immediately discontinue such use. No awning shall be permitted on any
part of the Premises without Lessor's specific approval in writing.
Lessee shall not place anything against or near glass partitions or
doors or windows which may appear unsightly from outside the Premises.
3. Lessee shall not obstruct any sidewalk, halls, passages, exits,
entrances, elevators, escalators, or stairways of the Building. The
halls, passages, exits, entrances, shopping malls, elevators,
escalators and stairways are not open to the general public. Lessor
shall in all cases retain the right to control and prevent access
thereto of all persons whose presence in the judgment of Lessor would
be prejudicial to the safety, character, reputation and interest of
the Building and its tenants; provided that nothing herein contained
shall be construed to prevent such access to persons with whom any
tenant normally deals in the ordinary course of its business, unless
such persons are engaged in illegal activities. No tenant and no
employee or invitee of any tenant shall go upon the roof of the
Building.
4. The directory of the Building will be provided exclusively for
the display of the name and location of tenants only, and Lessor
reserves the right to exclude any other names therefrom.
5. All cleaning and janitorial services for the Building and the
Premises shall be provided exclusively through Lessor, and except with
the written consent of Lessor, no person or persons other than those
approved by Lessor shall be employed by Lessee or permitted to enter
the Building for the purpose of cleaning the same. Lessee shall not
cause any unnecessary labor by carelessness or indifference to the
good order and cleanliness of the Premises. Lessor shall not in any
way be responsible to any Lessee for any loss of property on the
Premises, however occurring, or for any damage to any of Lessee's
property by the janitor or any other employee or any other persons.
6. Lessor will furnish Lessee, free of charge, two keys to each door
lock in the Premises. Lessor may make a reasonable charge for any
additional keys. Lessee shall not make or have made additional keys,
and Lessee shall not alter any lock or install a new additional lock
or bolt on any door of its Premises. Lessee, upon the termination of
its tenancy, shall deliver to Lessor the keys of all doors which have
been furnished to Lessee, and in the event of loss of any keys so
furnished, shall pay Lessor therefore.
7. If Lessee requires telegraphic, telephonic, burglar alarm or
similar services, it shall first obtain, and comply with, Lessor's
instructions in their installation.
8. Any freight elevator shall be available for use by all tenants in
the Building, subject to such reasonable scheduling as Lessor in its
discretion shall deem appropriate. No equipment, materials,
furniture, packages, supplies, merchandise or other property will be
received in the Building or carried in the elevators except between
such hours and in such elevators as may be designated by Lessor.
9. Lessee shall not place a load upon any floor of the Premises
which exceeds the load per square foot which such floor was designed
to carry and which is allowed by law. Lessor shall have the right to
prescribe the weight, size and position of all equipment, materials,
furniture or other property brought in to the Building. Heavy objects
shall, if considered necessary by Lessor, stand on such platforms as
determined by Lessor to be necessary to properly distribute the
weight. Business machines and mechanical equipment belonging to
Lessee, which cause noise or vibration that may be transmitted to the
structure of the Building or to any space therein to any tenants in
the Building, shall be placed and maintained by Lessee, at Lessee's
expense, on vibration eliminators or other devices sufficient to
eliminate noise or vibration. The persons employed to move such
equipment in or out of the building must be acceptable to Lessor.
Lessee agrees to place a plywood covering over any lobby, hallway,
elevator and office dooring and carpeting during any time where it is
constructing in the Premises or moving furniture into or out of the
Building. Pads shall be used in such a manner to protect walls and
ceilings in said lobbies, hallways, elevators and offices during said
construction or moving periods. Lessor will not be responsible for
loss of, or damage to, any such equipment or other property from any
cause, and all damage done to the Building including common areas,
hallways, elevators and doors by maintaining or moving such equipment
or other property shall be repaired at the expense of Lessee.
10. Lessee shall not use or keep in the Premises any kerosene,
gasoline or flammable or combustible fluid or material other than
those limited quantities necessary for the operation or maintenance of
office equipment. Lessee shall not use or permit to be used in the
Premises any foul or noxious gas or substance, or permit or allow the
Premises to be occupied or used in a manner offensive or objectionable
to Lessor or other occupants of the Building by reason of noise, odors
or vibrations, nor shall Lessee bring into or keep in or about the
Premises any birds, dogs, cats or animals of any kind.
11. Lessee shall not use any method of heating or air-conditioning
other than that supplied by Lessor.
12. Lessee shall not waste electricity, water or air-conditioning and
agrees to cooperate fully with Lessor to assure the most effective
operation of the Building's heating and air-conditioning and to comply
with any governmental energy-saving rules, laws or regulations of
which Lessee has actual notice, and shall refrain from attempting to
adjust controls. Lessee shall keep corridor doors closed, and shall
close window coverings at the end of each business day.
13. Lessor reserves the right, exercisable without notice and without
liability to Lessee, to change the name and street address of the
Building.
14. Lessor reserves the right to exclude from the Building between
the hours of 6 P.M. and 7 A.M. the following day, or such other hours
as may be established from time to time by Lessor, and on Sundays and
legal holidays, any person unless that person is known to the person
or employee in charge of the Building and has a pass or is properly
identified. Lessee shall be responsible for all persons for whom it
requests passes and shall be liable to Lessor for all acts of such
persons. Lessor shall not be liable for damages for any error with
regard to the admission to or exclusion from the Building of any
persons. Lessor reserves the right to prevent access to the Building
in case of invasion, mob, riot, public excitement or other commotion
by closing the doors or by other appropriate action. It is understood
that Lessee requires access for clients until 8 pm. weekdays and
occasionally on weekends. Lessor shall coordinate with Lessee a
mutually acceptable way for after-hours entry in to the building.
15. Lessee shall close and lock the doors of its Premises and
entirely shut off all water faucets or other water apparatus, and
electricity, gas or air outlets before Lessee and its employees leave
the Premises. Lessee shall be responsible for any damage or injuries
sustained by other tenants or occupants of the building or by Lessor
for noncompliance with this rule.
16. Lessee shall not obtain for use on the Premises ice, drinking
water, food, beverage, towel or other similar services or accept
barbering or bootblacking service upon the Premises, except at such
hours and under such regulations as may be fixed by Lessor.
17. The toilet rooms, toilets, urinals, wash bowls and other
apparatus shall not be used for any purpose other than that for which
they were constructed and no foreign substance of any kind whatsoever
shall be thrown therein. The expense of any breakage, stoppage or
damage resulting from the violation of this rule shall be borne by the
tenant who, or whose employees or invitees, shall have caused it.
18. Lessee shall not sell, or permit any sales of newspapers,
magazines, periodicals, theater tickets or any other goods or
merchandise to the general public in or on the Premises or the common
area. Lessee shall not make any room-to-room solicitation of business
from other tenants in the Building nor shall Lessee solicit in any
part of the common areas. Lessee shall not use the Premises for any
business or activity other than that specifically provided for in
Lessee's Lease.
19. Lessee shall not install any radio or television antenna,
loudspeaker or other device on the roof or exterior walls of the
Building. Lessee shall not interfere with radio or television
broadcasting or reception from or in the Building or elsewhere.
20. Lessee shall not xxxx, drive nails, screws or drill in to the
partitions, woodwork or plaster or in any way deface the Premises or
any part thereof. Lessor reserves the right to direct electricians as
to where and how telephone and telegraph wires are to be introduced to
the Premises. Lessee shall not cut or bore holes for wires. Lessee
shall not affix any floor covering to the floor of the Premises in any
manner except as approved by Lessor. Lessee shall repair any damage
resulting from noncompliance with this rule. Lessee shall pay for any
and all damages to the Building, walls, doors, glass, carpeting or
otherwise which may be caused by Lessee's use of the Building, moving
equipment, supplies or furniture into or out of the Building whether
caused by Lessee or its employes, agents, contractors or invitees to
the Premises.
21. Lessee shall not install, maintain or operate upon the Premises
any vending machine without the written consent of Lessor.
22. Canvassing, soliciting and distribution of handbills or any other
written material, and peddling in the Building or in the common areas
and parking lot are prohibited, and each tenant shall cooperate to
prevent same.
23. Lessor reserves the right to exclude or expel from the Building
any person who, in Lessor's judgment, is intoxicated or under the
influence of liquor or drugs or who is in violation of any of the
Rules and Regulations of the Building.
24. Lessee shall store all its trash and garbage within its Premises.
Lessee shall not place in any trash box or receptacle any material
which cannot be disposed of in the ordinary and customary manner of
trash and garbage disposal. All garbage and refuse disposal shall be
made in accordance with directions issued from time to time by Lessor.
25. The Premises shall not be used for the storage of merchandise
held for sale to the general public, or for lodging or for
manufacturing of any kind, nor shall the Premises be used for any
improper, immoral or objectionable purpose. NO cooking shall be done
or permitted by any tenant on the Premises, except that use by Lessee
of Underwriters' Laboratory approved equipment for brewing coffee,
tea, but chocolate and similar beverages shall be permitted, provided
that such equipment and use is in accordance with all applicable
federal, state, county and city laws, codes, ordinances, rules and
regulations.
26. Lessee shall not use in any space or in the public halls of the
building any hand truck except those equipped with rubber tires and
side guards or such other material-handling equipment as Lessor may
approve. Lessee shall not bring any other vehicles of any kind in to
the Building.
27. Without the written consent of Lessor, Lessee shall not use the
name of the Building in connection with or in promoting or advertising
the business of Lessee except as Lessee's address.
28. Lessee shall comply with all safety, fire protection and
evacuation procedures and regulations established by Lessor or any
governmental agency.
29. Lessee assumes any and all responsibility for protecting its
Premises from theft, robbery and pilferage, which includes keeping
doors locked and other means of entry to the Premises closed. Lessee
agrees that the cost to repair any damage to the Building and
Premises, as a result of theft, robbery and pilferage, shall be borne
by the Lessee.
30. The requirements of Lessee will be attended to only upon
appropriate application to the office of the Building by an authorized
individual. Employees of Lessor shall not perform any work or do
anything outside of their regulated duties unless under special
instructions from Lessor, and no employee of Lessor will admit any
persons (Lessee or otherwise) to any office without specific
instruction from lessor.
31. Lessee shall not park its vehicles in any parking areas
designated by Lessor as areas for parking by visitors to the Building.
Lessee shall not leave vehicles in the Building parking areas
overnight nor park any vehicles in the Building parking areas other
than automobiles, motorcycles, motor drive or non-motor drive bicycles
or four-wheeled trucks. Said vehicles improperly parked shall be
subject to a fine of $20.00 per day per violating vehicle or, upon 24
hours notice, shall be subject to towing at the vehicle owner's
expense.
32. Lessor may waive any one or more of these Rules and Regulations
for the benefit of Lessee or any other tenant, but no such waiver by
Lessor shall be construed as a waiver of such Rules and Regulations in
favor of Lessee or any other tenant, nor prevent Lessor from
thereafter enforcing any such Rules and Regulations against any or all
of the tenants of the Building.
33. These Rules and Regulations are in addition to, and shall not be
construed to in any way modify or amend, in whole or in part, the
terms, covenants, agreements and conditions of any lease of premises
in the Building.
34. Lessor reserves the right to make such other and reasonable Rules
and Regulations as, in its judgment, may from time to time be needed
for safety and security, for care and cleanliness of the Building and
for the preservation of good order therein. Lessee agrees to abide by
all such Rules and Regulations hereinabove stated and any additional
rules and regulations which are adopted.
35. Lessee shall be responsible for the observance of all of the
foregoing rules of Lessee's employees, agents, clients, customers,
invitees and guests.
SECOND ADDENDUM TO LEASE
This Second Addendum dated March 3, 1997, modifies that certain
Lease Agreement dated February 20, 1997 by and between LCTR
L.L.C., a Washington Limited Liability Company ("Lessor") and
Chicago Pizza Northwest, Inc., a Washington corporation
("Lessee") as follows:
1. Lessee agrees to provide Lessor with an internally prepared
December 31, 1996 year-end set of financial statements, and will
place Lessor on a permanent distribtuion list for its financial
statements prepared not less than quarterly, and its periodic and
year-end stockholder reports together with financial statements
prepared by its independent auditors commencing with the 1996
statements and stockholder report as soon as they become
available. Lessee also agrees to have Lessor placed on the Lease
Guarantor's regular distribution list for quarterly financial
statements and reports, and year-end independently audited
financial statements together with reports to stockholders.
All the terms and conditions of the lease, its Addendum and all
exhibits shall remain in full force and effect except for the
supplemental provisions contained herein.
ACKNOWLEDGED AND AGREED: ACKNOWLEDGED AND AGREED:
LANDLORD TENANT
LCTR L.L.C. Chicago Pizza
Northwest, Inc.
a Washington Limited Liability company A Washington corporation
By: _/s/Xxxxxx Gregory________________ By:_____________________________
Printed Name:__________________
Its: _Mamager__________________________ Its:_____________________________
Date: __3-4-97_____________________ Date:___________________________
