EXHIBIT 10.11
Master Lease for the property located at
0000 Xxxx Xxxxxxx Xxxx., Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx
dated June 17, 1997
STANDARD OFFICE LEASE
FOR
SKYVIEW CENTER
BY AND BETWEEN
ARDEN REALTY LIMITED PARTNERSHIP,
A MARYLAND LIMITED PARTNERSHIP,
AS LANDLORD,
AND
METROPOLITAN LIFE INSURANCE COMPANY,
A NEW YORK CORPORATION,
AS TENANT
TABLE OF CONTENTS
PAGE
----
ARTICLE 1.....................................BASIC LEASE PROVISIONS 1
ARTICLE 2.......................................................TERM 2
ARTICLE 3.....................................................RENTAL 2
(a)...........................................Basic Rental. 2
(b)...............................Increase in Direct Costs. 2
(c)............................................Definitions. 3
(d)...............................Determination of Payment. 7
ARTICLE 4....................................COMMUNICATION EQUIPMENT 9
ARTICLE 5...............................................HOLDING OVER 10
ARTICLE 6....................................PERSONAL PROPERTY TAXES 11
ARTICLE 7........................................................USE 11
ARTICLE 8......................................CONDITION OF PREMISES 12
ARTICLE 9....................................REPAIRS AND ALTERATIONS 12
ARTICLE 10.....................................................LIENS 13
ARTICLE 11..........................................PROJECT SERVICES 14
ARTICLE 12........................................RIGHTS OF LANDLORD 16
ARTICLE 13...........INDEMNITY; EXEMPTION OF LANDLORD FROM LIABILITY 16
(a)..............................................Indemnity. 16
(b)...................Exemption of Landlord from Liability. 17
ARTICLE 14.................................................INSURANCE 18
(a).....................................Tenant's Insurance. 18
(b).......................................Form of Policies. 19
(c)...................................Landlord's Insurance. 19
(d)..................................Waiver of Subrogation. 19
i
(e)....................................Compliance with Law. 20
ARTICLE 15.................................ASSIGNMENT AND SUBLETTING 20
ARTICLE 16.....................................DAMAGE OR DESTRUCTION 23
ARTICLE 17.............................................SUBORDINATION 24
ARTICLE 18............................................EMINENT DOMAIN 25
ARTICLE 19...................................................DEFAULT 25
ARTICLE 20..................................................REMEDIES 26
ARTICLE 21...........................TRANSFER OF LANDLORD'S INTEREST 28
ARTICLE 22....................................................BROKER 28
ARTICLE 23...................................................PARKING 29
ARTICLE 24....................................................WAIVER 30
ARTICLE 25......................................ESTOPPEL CERTIFICATE 30
ARTICLE 26.....................................LIABILITY OF LANDLORD 30
ARTICLE 27..................................... INABILITY TO PERFORM 31
ARTICLE 28...........................................HAZARDOUS WASTE 31
ARTICLE 29................SURRENDER OF PREMISES; REMOVAL OF PROPERTY 33
ARTICLE 30.............................................MISCELLANEOUS 34
(a).........................Severability; Entire Agreement. 34
(b)..................Attorneys' Fees; Waiver of Jury Trial. 34
(c)........................................Time of Essence. 35
(d)...............................................Headings. 35
(e)..........................................Reserved Area. 35
(f)..............................................No Option. 35
(g)......................Use of Project Name; Improvements. 35
(h)..................................Rules and Regulations. 35
ii
(i).......................................Quiet Possession. 36
(j)...................................................Rent. 36
(k).................................Successors and Assigns. 36
(l)................................................Notices. 36
(m)...............................Persistent Delinquencies. 36
(n)...........................Right of Landlord to Perform. 36
(o)...........Access, Changes in Project, Facilities, Name. 37
(p).........................,,.........Corporate Authority. 37
(q)...............................Identification of Tenant. 37
(r)....................................Substitute Premises. 39
(s)..................................Exhibits and Addendum. 39
ARTICLE 31..........................................OPTION TO EXTEND 39
(a)...........................................Option Right. 39
(b)............................................Option Rent. 39
(c)....................................Exercise of Options. 40
(d)...........................Determination of Market Rent. 40
ARTICLE 32......................................RIGHT OF FIRST OFFER 41
ARTICLE 33.................................................DIRECTORY 43
ARTICLE 34........................................TERMINATION OPTION 43
Addendum. / / Yes /X/ No
Exhibit "A" Premises
Exhibit "B" Rules and Regulations
Exhibit "C" Notice of Lease Term Dates and Tenant's Proportionate Share
Exhibit "D" Tenant Work Letter
iii
TABLE OF CONTENTS
INDEX OF DEFINED TERMS
DEFINED TERMS PAGE
------------- ----
Abatement Event............................................................15
Abatement Notice...........................................................15
ADA........................................................................11
Additional Allowance................................................Exhibit D
Additional Rent.............................................................3
Applicable Reassessment.....................................................4
Approved Working Drawings...........................................Exhibit D
Architect...........................................................Exhibit D
Base Year...................................................................3
Base, Shell and Core................................................Exhibit D
Basic Rental................................................................2
Brokers.....................................................................2
Claims.....................................................................16
Code................................................................Exhibit D
Commencement Date...........................................................1
Communication Equipment.....................................................8
Communication Equipment Notice..............................................8
Construction Drawings...............................................Exhibit D
Contract............................................................Exhibit D
Contractor..........................................................Exhibit D
Damage Repair Estimate.....................................................22
Direct Costs................................................................3
Economic Terms.............................................................40
Eligibility Period.........................................................15
Engineers...........................................................Exhibit D
Estimate....................................................................6
Estimate Statement..........................................................6
Estimated Excess............................................................7
Event of Default...........................................................24
Excess......................................................................6
Expiration Date.............................................................1
Final Costs.........................................................Exhibit D
Final Space Plan....................................................Exhibit D
Final Working Drawings..............................................Exhibit D
First Month's Rent..........................................................2
First Offer Notice.........................................................40
First Offer Space..........................................................39
Force Majeure..............................................................30
Hazardous Material..........................................................6
Interest Notice............................................................38
Landlord....................................................................1
Landlord Delay......................................................Exhibit D
Laws.......................................................................32
Lease.......................................................................1
Lease Year..................................................................2
Market Rent................................................................38
Operating Costs.............................................................5
Option.....................................................................38
Option Rent................................................................38
Option Rent Notice.........................................................38
Option Term................................................................38
Original Tenant............................................................38
Outside Agreement Date.....................................................38
Parking Passes..............................................................2
Partnership Tenant.........................................................36
Permits.............................................................Exhibit D
Permitted Use...............................................................2
Premises....................................................................1
Project.....................................................................1
Proposition 13 Protection Amount............................................4
Proposition 13 Purchase Price...............................................4
Real Property...............................................................3
Reassessment................................................................4
Representative.............................................................30
Review Period...............................................................7
Security Deposit............................................................1
Square Footage..............................................................1
Statement...................................................................7
Structure Passes............................................................2
Superior Leases............................................................39
Superior Rights............................................................40
Surface Passes..............................................................2
Tax Costs...................................................................3
Tax Increase................................................................4
Tenant......................................................................1
Tenant's Acceptance........................................................38
Tenant Improvement Allowance........................................Exhibit D
Tenant Improvement Allowance Items..................................Exhibit D
Tenant Improvements.................................................Exhibit D
Tenant's Agents.....................................................Exhibit D
Tenant's Proportionate Share................................................1
Term........................................................................1
Termination Date...........................................................41
Termination Fee............................................................41
Termination Notice.........................................................41
Termination Option.........................................................41
Transfer...................................................................20
Transfer Premium...........................................................20
Transferee.................................................................20
Uncontrollable Delay................................................Exhibit D
STANDARD OFFICE LEASE
This Standard Office Lease ("Lease") is made and entered into as of
this 17th day of June, 1997, by and between ARDEN REALTY LIMITED PARTNERSHIP, a
Maryland limited partnership ("Landlord"), and METROPOLITAN LIFE INSURANCE
COMPANY, a New York corporation ("Tenant").
Landlord hereby leases to Tenant and Tenant hereby leases from Landlord
the premises described as Suite No. 500, as designated on the plan attached
hereto and incorporated herein as Exhibit "A" ("Premises"), of the project
("Project") now known as "SKYVIEW CENTER" whose address is 0000 Xxxx Xxxxxxx
Xxxxxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx for the Term and upon the terms and
conditions hereinafter set forth, and Landlord and Tenant hereby agree as
follows:
BASIC LEASE PROVISIONS
A. TERM: Ten (10) years
COMMENCEMENT DATE: The earlier of (i) the date Tenant first
commences to conduct business in the
Premises, or October 1, 1997, subject to
Section 5 of the Tenant Work Letter.
EXPIRATION DATE: The last day of the month which is
one hundred twenty (120) months after
the month in which the Commencement Date
falls, unless extended or earlier
terminated pursuant to this Lease.
B. SQUARE FOOTAGE: 16,339 rental (15,059 usable) square
feet
C. BASIC RENTAL:
Annual Monthly Monthly Basic Rental
Lease Year Basic Rental Basic Rental Per Rentable Square Foot
---------- ------------ ------------ ------------------------
1-5 $235,281.60 $19,606.80 $1.20
6-10 $274,495.20 $22,874.60 $1.40
D. BASE YEAR: 1998
E. TENANT'S PROPORTIONATE SHARE: 8.37%
F. SECURITY DEPOSIT: None
G. PERMITTED USE: General office use and employee
training center.
1
Initials: ____
____
H. BROKERS: Xxx & Associates
I. PARKING PASSES: Tenant shall have the use of up
to forty-eight (48) unreserved
parking passes in the Project's
surface parking lot ("Surface
Passes") and up to fifteen (15)
unreserved parking passes in the
Project's parking structure
("Structure Passes"), at the
rate provided in Article 23
hereof.
J. FIRST MONTH'S RENT: The first full month's rent of
$19,606.80 shall be due and
payable by Tenant to Landlord,
within fifteen (15) days after
Tenant's receipt of the fully
executed Lease.
TERM
The Term of this Lease shall commence on the Commencement Date as set
forth in Article 1.A. of the Basic Lease Provisions and shall end on the
Expiration Date set forth in Article 1.A. of the Basic Lease Provisions. For
purposes of this Lease, the term "Lease Year" shall mean each consecutive twelve
(12) month period during the Lease Term, with the first Lease Year commencing on
the Commencement Date; however, (a) if the Commencement Date falls on a day
other than the first day of a calendar month, the first Lease Year shall end on
the last day of the eleventh (11th) month after the Commencement Date and the
second (2nd) and each succeeding Lease Year shall commence on the first day of
the next calendar month, and (b) the last Lease Year shall end on the Expiration
Date. If Landlord is unable to deliver possession of the Premises to Tenant on
or before the anticipated Commencement Date, except as provided in Section 5.3
of the Tenant Work Letter attached hereto as Exhibit "D," Landlord shall not be
subject to any liability for its failure to do so, and such failure shall not
affect the validity of this Lease nor the obligations of Tenant hereunder.
RENTAL
BASIC RENTAL. Tenant agrees to pay to Landlord during the Term hereof,
at Landlord's office or to such other person or at such other
place as directed from time to time by written notice to
Tenant from Landlord, the initial monthly and annual sums as
set forth in Article 1.C. of the Basic Lease Provisions,
payable in advance on the first day of each calendar month,
without demand, setoff or deduction, and in the event this
Lease commences or the date of expiration of this Lease occurs
other than on the first day or last day of a calendar month,
the rent for such month shall be prorated. Notwithstanding the
foregoing, the first full month's rent shall be paid to
Landlord in accordance with Article 1.J. of the Basic Lease
Provisions.
INCREASE IN DIRECT COSTS. The term "Base Year" means the calendar year
set forth in Article 1.D. of the Basic Lease Provisions. If,
in any calendar year during the Term of this Lease, the
"Direct Costs" (as hereinafter defined) paid or incurred by
2
Initials: ____
____
Landlord shall be higher than the Direct Costs for the Base
Year, Tenant shall pay an additional sum for such and each
subsequent calendar year equal to the product of the amount
set forth in Article 1.E. of the Basic Lease Provisions
multiplied by such increased amount of "Direct Costs." In the
event either the Premises and/or the Project is expanded or
reduced, then Tenant's Proportionate Share shall be
appropriately adjusted, and as to the calendar year in which
such change occurs, Tenant's Proportionate Share for such year
shall be determined on the basis of the number of days during
that particular calendar year that such Tenant's Proportionate
Share was in effect. In the event this Lease shall terminate
on any date other than the last day of a calendar year, the
additional sum payable hereunder by Tenant during the calendar
year in which this Lease terminates shall be prorated on the
basis of the relationship which the number of days which have
elapsed from the commencement of said calendar year to and
including said date on which this Lease terminates bears to
three hundred sixty (360). Any and all amounts due and payable
by Tenant pursuant to Article 3(b), (c) and (d) hereof shall
be deemed "Additional Rent" and Landlord shall be entitled to
exercise the same rights and remedies upon default in these
payments as Landlord is entitled to exercise with respect to
defaults in monthly Basic Rental payments.
DEFINITIONS. As used herein the term "Direct Costs" shall mean the sum
of the following:
"Tax Costs," which shall mean any and all real estate taxes
and other similar charges on real property or
improvements, assessments, water and sewer charges, and
all other charges assessed, reassessed or levied upon
the Project and appurtenances thereto and the parking or
other facilities thereof, or the real property
thereunder (collectively the "Real Property") or
attributable thereto or on the rents, issues, profits or
income received or derived therefrom which are assessed,
reassessed or levied by the United States, the State of
California or any local government authority or agency
or any political subdivision thereof, and shall include
Landlord's reasonable legal fees, costs and
disbursements incurred in connection with proceedings
for reduction of Tax Costs or any part thereof;
provided, however, if at any time after the date of this
Lease the methods of taxation now prevailing shall be
altered so that in lieu of or as a supplement to or a
substitute for the whole or any part of any Tax Costs,
there shall be assessed, reassessed or levied (a) a tax,
assessment, reassessment, levy, imposition or charge
wholly or partially as a net income, capital or
franchise levy or otherwise on the rents, issues,
profits or income derived therefrom, or (b) a tax,
assessment, reassessment, levy (including but not
limited to any municipal, state or federal levy),
imposition or charge measured by or based in whole or in
part upon the Real Property and imposed upon Landlord,
or (c) a license fee measured by the rent payable under
this Lease, then all such taxes, assessments,
reassessments or levies or the part thereof so measured
or based, shall be deemed to be included in the term
"Direct Costs." Any taxes or assessments that may be
paid over more than a one-year period shall be
apportioned evenly over the
3
Initials: ____
____
maximum period of payment time permitted by
applicable law and only the portion thereof
attributable to a given year shall be included in Tax
costs for that year. Tax Costs shall not include (i)
any federal, state or local income, profit,
franchise, privilege, capital levy, excise,
inheritance, estate, succession, gift, deed,
conveyance or transfer taxes or (ii) any penalties or
interest for the late payment thereof. In no event
shall Tax Costs included in Direct Costs for any year
subsequent to the Base Year be less than the amount
of Tax Costs included in direct Costs for the Base
Year. In addition, when calculating Tax Costs for the
Base Year, special assessments shall only be deemed
included in Tax Costs for the Base Year to the extent
that such special assessments are included in Tax
Costs for the applicable subsequent calendar year
during the Term.
Notwithstanding anything to the contrary contained in this Lease, in
the event that, at any time during the first three (3) Lease Years, any sale,
refinancing, or change in ownership of the Real Property is consummated, and as
a result thereof, and to the extent that in connection therewith, the Real
Property is reassessed (the "Reassessment") for real estate tax purposes by the
appropriate governmental authority pursuant to the terms of Proposition 13, then
the following provisions shall apply to such Reassessment of the Real Property.
For purposes of this Section 3(c)(i), the term "Tax Increase" shall
mean that portion of the Tax Costs, as calculated immediately following the
Reassessment, which is attributable solely to the Reassessment. Accordingly, the
term Tax Increase shall not include any portion of the Tax Costs, as calculated
immediately following the Reassessment, which (i) is attributable to the initial
assessment of the value of the Real Property, the base, shell and core of the
Project or the tenant improvements located in the Building, (ii) is attributable
to assessments which were pending immediately prior to the Reassessment which
assessments were conducted during, and included in, such Reassessment, or which
assessments were otherwise rendered unnecessary following the Reassessment, or
(iii) is attributable to the annual inflationary increase of real estate taxes
permitted to be assessed annually under Proposition 13. During the first three
(3) years of the initial Lease Term, any Tax Increase shall be excluded from Tax
Costs. After the first three (3) years of the initial Lease Term, any Tax
Increase shall be included in Tax Costs.
The amount of Tax Costs which Tenant is not obligated to pay or will
not be obligated to pay during the first three (3) years of the initial Lease
Term in connection with a particular Reassessment pursuant to the terms of this
Section 3(c)(i), shall be sometimes referred to hereafter as a "Proposition 13
Protection Amount." If the occurrence of a Reassessment is reasonably
foreseeable by Landlord and the Proposition 13 Protection Amount attributable to
such Reassessment can be reasonably quantified or estimated for each Lease Year
commencing with the Lease Year in which the Reassessment will occur, the terms
of this Section 3(c)(i) shall apply to each such Reassessment. Upon notice to
Tenant, Landlord shall have the right to purchase the Proposition 13 Protection
Amount relating to the Applicable Reassessment (the "Applicable Reassessment"),
at any time during the Lease Term, by paying to Tenant an amount equal to the
Proposition 13 Purchase Price, as that term is defined below, provided that the
right of any successor of Landlord to exercise its right of repurchase hereunder
shall not apply to any Reassessment which results from the event pursuant to
which such successor of Landlord
4
Initials: ____
____
became the Landlord under this Lease. As used herein, "Proposition 13
Purchase Price" shall mean the present value of the Proposition 13 Protection
Amount remaining during the Lease Term, as of the date of payment of the
Proposition 13 Purchase Price by Landlord. Such present value shall be
calculated (i) by using the portion of the Proposition 13 Protection Amount
attributable to each remaining Lease Year (as though the portion of such
Proposition 13 Protection Amount benefited Tenant at the end of each Lease
Year), as the amounts to be discounted, and (ii) by using discount rates for
each amount to be discounted equal to (A) the prime interest rate, as
reported in the Wall Street Journal as of the date of Landlord's exercise of
its right to purchase, as set forth in this Section 3(c)(i), plus (B) two
percent (2%) per annum. Upon such payment of the Proposition 13 Purchase
Price, the provisions of the immediately preceding paragraph of Section
3(c)(i) of this Lease shall not apply to any Tax Increase attributable to the
Applicable Reassessment. Since Landlord is estimating the Proposition 13
Purchase Price because a Reassessment has not yet occurred, then when such
Reassessment occurs, if Landlord has underestimated the Proposition 13
Purchase Price, then upon notice by Landlord to Tenant, Tenant's Basic Rental
next due shall be credited with the amount of such underestimation, and if
Landlord overestimates the Proposition 13 Purchase Price, then upon notice by
Landlord to Tenant, Basic Rental next due shall be increased by the amount of
the overestimation.
"Operating Costs," which shall mean all costs and expenses
incurred by Landlord in connection with the
maintenance, operation, replacement, ownership and
repair of the Project, the equipment, the
intrabuilding network cable, adjacent walks, malls
and landscaped and common areas and the parking
structure, areas and facilities of the Project,
including, but not limited to, salaries, wages,
medical, surgical and general welfare benefits and
pension payments, payroll taxes, fringe benefits,
employment taxes, workers' compensation, uniforms and
dry cleaning thereof for all persons who perform
duties connected with the operation, maintenance and
repair of the project, its equipment, the
intrabuilding network cable and the adjacent walks
and landscaped areas, including janitorial,
gardening, security, parking, operating engineer,
elevator, painting, plumbing, electrical, carpentry,
heating, ventilation, air conditioning, window
washing, hired services, the rental expense of
personal property used in the maintenance, operation
and repair of the Project, accountant's fees incurred
in the preparation of rent adjustment statements,
legal fees, real estate tax consulting fees, personal
property taxes on property used in the maintenance
and operation of the Project, capital expenditures
incurred to effect economies of operation and capital
expenditures required by government regulations,
laws, or ordinances including, but not limited to the
American with Disabilities Act; the cost of all
charges for electricity, gas, water and other
utilities furnished to the Project, including any
taxes thereon; the cost of all charges for fire and
extended coverage, liability and all other insurance
for the Project carried by Landlord; the cost of all
building and cleaning supplies and materials; the
cost of all charges for cleaning, maintenance and
service contracts and other services with independent
contractors and administration fees; a property
management
5
Initials: ____
____
fee (which fee may be imputed if Landlord has
internalized management or otherwise acts as its
own property manager) and license, permit and
inspection fees relating to the Project. In the
event, during any calendar year including the Base
Year, the Project is less than ninety-five percent
(95%) occupied at all times, Operating Costs shall
be adjusted to reflect the Operating Costs of the
Project as though ninety-five percent (95%) were
occupied at all times, and the increase or decrease
in the sums owned hereunder shall be based upon
such Operating Costs as so adjusted.
Notwithstanding anything to the contrary set forth
in this Article 3, when calculating Operating Costs
for the Base Year, Operating Costs shall exclude
(a) market-wide labor-rate increases due to
extraordinary circumstances including, but not
limited to, boycotts and strikes, (b) utility rate
increases due to extraordinary circumstances
including, but not limited to, conservation
surcharges, boycotts, embargoes or other shortages,
and (c) amortization of any capital items
including, but not limited to, capital
improvements, capital repairs and capital
replacements (including such amortized costs where
the actual improvement, repair or replacement was
made in prior years).
Notwithstanding anything above to the contrary, Operating Costs shall
not include (1) the cost of providing any service directly to and paid
directly by any tenant (outside of such tenant's Direct cost payments); (2)
the cost of any items for which Landlord is reimbursed by insurance proceeds,
condemnation awards, a tenant of the Project, or otherwise to the extent so
reimbursed; (3) any real estate brokerage commissions or other costs incurred
in procuring tenants, or any fee in lieu of commission; (4) depreciation,
amortization of principal and interest on mortgages or ground lease payments
(if any); (5) costs of items considered capital repairs, replacements,
improvements and equipment under generally accepted accounting principles
consistently applied except as expressly included in Operating Costs pursuant
to the definition above; (6) costs incurred by Landlord due to the violation
by Landlord or any tenant of the terms and conditions of any lease of space in
the Project or any law, code, regulation, ordinance or the like; (7)
Landlord's general corporate overhead and general and administrative expenses;
(8) any compensation paid to clerks, attendants or other persons in commercial
concessions operated by Landlord (other than in the parking facility for the
Project); (9) costs incurred in connection with upgrading the Project to
comply with disability, life, seismic, fire and safety codes, ordinances,
statutes, or other laws in effect prior to the Commencement Date, including,
without limitation, the ADA, including penalties or damages incurred due to
such non-compliance; and (10) costs incurred to (i) comply with laws relating
to the removal of any "Hazardous Material," as that term is defined in Article
28 of this Lease, which was in existence on the Project prior to the
Commencement Date, and was of such a nature that a federal, state or municipal
governmental authority, if it had then had knowledge of the presence of such
Hazardous Material, in the state, and under the conditions that it then
existed on the Project, would have then required the removal of such Hazardous
Material or other remedial or containment action with respect thereto, and
(ii) to remove, remedy, contain, or treat any Hazardous Material, which
Hazardous Material is brought onto the Project after the date hereof by
Landlord or any other tenant of the Project and is of such a nature, at that
time, that a federal, state or municipal governmental authority, if it had
then had knowledge of the presence of such Hazardous Material, in the state,
and under the
6
Initials: ____
____
conditions, that it then exists on the Project, would have then required the
removal of such Hazardous Material or other remedial or containment action
with respect thereto.
DETERMINATION OF PAYMENT.
If for any calendar year ending or commencing within the Term,
Tenant's Proportionate Share of Direct Costs for such
calendar year exceeds Tenant's Proportionate Share of
Direct Costs for the Base Year, then Tenant shall pay
to Landlord, in the manner set forth in Sections
3(d)(ii) and (iii), below, and as additional rent, an
amount equal to the excess (the "Excess").
Landlord shall give Tenant a yearly expense estimate statement
(the "Estimate Statement") which shall set forth
Landlord's reasonable estimate (the "Estimate") of
what the total amount of Direct Costs for the
then-current calendar year shall be and the estimated
Excess (the "Estimated Excess") as calculated by
comparing Tenant's Proportionate Share of Direct Costs
for such calendar year, which shall be based upon the
Estimate, to Tenant's Proportionate Share of Direct
Costs for the Base Year. The failure of Landlord to
timely furnish the Estimate statement for any calendar
year shall not preclude Landlord from enforcing its
rights to collect any Estimated Excess under this
Article 3. If pursuant to the Estimate Statement an
Estimated Excess is calculated for the then-current
calendar year, Tenant shall pay, with its next
installment of Monthly Basic Rental due, a fraction of
the estimated Excess for the then-current calendar
year reduced by any amounts paid pursuant to the last
sentence of this Section 3(d)(ii)). Such fraction
shall have as its numerator the number of months which
have elapsed in such current calendar year to the
month of such payment, both months inclusive, and
shall have twelve (12) as its denominator. Until a new
Estimate Statement is furnished, Tenant shall pay
monthly, with the Monthly Basic Rental installments,
an amount equal to one-twelfth (1/12th) of the total
Estimated Excess set forth in the previous Estimate
Statement delivered by Landlord to Tenant.
In addition, Landlord shall endeavor to give to Tenant on or
before the first day of April following the end of
each calendar year, a statement (the "Statement")
which shall state the Direct Costs incurred or accrued
for such preceding calendar year, and which shall
indicate the amount, if any, of the Excess. Upon
receipt of the Statement for each calendar year during
the Term, if amounts paid by Tenant as Estimated
Excess are less than the actual Excess as specified on
the Statement, Tenant shall pay, with its next
installment of Monthly Basic Rental due, the full
amount of the Excess for such calendar year, less the
amounts, if any, paid during such calendar year as
Estimated Excess. If, however, the Statement indicates
that amounts paid by Tenant as Estimated Excess are
greater than the actual Excess as specified on the
Statement, such overpayment
7
Initials: ____
____
shall be credited against Tenant's next installments
of Estimated Excess. The failure of Landlord to
timely furnish the Statement for any calendar year
shall not prejudice Landlord from enforcing its
rights under this Article 3. Even though the Term
has expired and Tenant has vacated the Premises,
when the final determination is made of Tenant's
Proportionate Share of the Direct Costs for the
calendar year in which this Lease terminates, if an
Excess is present, Tenant shall immediately pay to
Landlord an amount as calculated pursuant to the
provisions of this Article 3(d). The provisions of
this Section 3(d)(iii) shall survive the expiration
or earlier termination of the Term.
Within one hundred twenty (120) days after receipt of a
Statement by Tenant ("Review Period"), if Tenant
disputes the amount set forth in the Statement,
Tenant's employees or an independent certified public
accountant (which accountant is a member of a
nationally or regionally recognized accounting firm),
designated by Tenant, may, after reasonable notice to
Landlord and at reasonable times, inspect Landlord's
records, provided that Tenant is not then in default
after expiration of all applicable cure periods and
provided further that Tenant and such accountant or
representative shall, and each of them shall use their
commercially reasonable efforts to cause their
respective agents and employees to, maintain all
information contained in Landlord's records in strict
confidence. Notwithstanding the foregoing, Tenant
shall only have the right to review Landlord's records
one (1) time during any twelve (12) month period.
Tenant's failure to dispute the amounts set forth in
any Statement within the Review Period shall be deemed
to be Tenant's approval of such Statement and Tenant,
thereafter, waives the right or ability to dispute the
amounts set forth in such Statement. If after such
inspection, but within thirty (30) days after the
Review Period, Tenant notifies Landlord in writing
that Tenant still disputes such amounts, a
certification as to the proper amount shall be made,
at Tenant's expense, by an independent certified
public accountant selected by Landlord and who is a
member of a nationally or regionally recognized
accounting firm. Landlord shall cooperate in good
faith with Tenant and the accountant to show Tenant
and the accountant the information upon which the
certification is to be based. However, if such
certification by the accountant proves that the Direct
Costs set forth in the Statement were overstated by
more than ten percent (10%), then the cost of the
accountant and the cost of such certification, the
parties shall make such appropriate payments or
reimbursements, as the case may be, to each other, as
are determined to be owing pursuant to such
certification.
If the Project is a part of a multi-building development,
those Direct Costs attributable to such development as
a whole (and not attributable solely to any individual
building therein) shall be allocated by Landlord to
the
8
Initials: ____
____
Project and to the other buildings within such
development on an equitable basis.
COMMUNICATION EQUIPMENT
If Tenant desires to use the roof of the Project to install
communication equipment to be used from the Premises, Tenant may so notify
Landlord in writing ("Communication Equipment Notice"), which Communication
Equipment Notice shall generally describe the specifications for the equipment
desired by Tenant. If at the time of Landlord's receipt of the Communication
Equipment Notice, Landlord reasonably determines that space is available on the
roof of the Project for such equipment, and that such use by Tenant would not
interfere with the rights of any other tenant of the Building, then subject to
all governmental laws, rules and regulations, Tenant and Tenant's contractors
(which shall first be reasonably approved by Landlord) shall have the right and
access to install, repair, replace, remove, operate and maintain one (1)
so-called "satellite dish" or other similar device, such as antennae
(collectively, "Communication Equipment") no greater than eighteen (18) inches
in diameter, together with all cable, wiring, conduits and related equipment,
for the purpose of receiving and sending radio, television, computer, telephone
or other communication signals, at a location on the roof of the Project
designated by Landlord. Landlord shall have the right to require Tenant to
relocate the Communication Equipment at any time to another location on the roof
of the Project reasonably approved by Tenant. Tenant shall retain Landlord's
designated roofing contractor to make any necessary penetrations and associated
repairs to the roof in order to preserve Landlord's roof warranty. Tenant's
installation and operation of the Communication Equipment shall be governed by
the following terms and conditions:
Tenant's right to install, replace, repair, remove, operate and
maintain the Communication Equipment shall be subject to all
governmental laws, rules and regulations and Landlord makes no
representation that such laws, rules and regulations permit
such installation and operation.
All plans and specification for the Communication Equipment shall
be subject to Landlord's reasonable approval, which approval
shall not be unreasonably withheld or delayed.
All costs of installation, operation and maintenance of the
Communication Equipment and any necessary related equipment
(including, without limitation, costs of obtaining any
necessary permits and connections to the Project's electrical
system) shall be borne by Tenant.
It is expressly understood that Landlord retains the right to use the
roof of the Project for any purpose whatsoever provided that
Landlord shall not unduly interfere with Tenant's use of the
Communication Equipment.
Tenant shall use the Communication Equipment so as not to cause any
interference to other tenants in the Project or to other
tenants of the Project or with any other
9
Initials: ____
____
tenant's Communication Equipment, and not to damage the
Project or interfere with the normal operation of the Project.
Landlord shall not have any obligations with respect to the
Communication Equipment. Landlord makes no representation that
the Communication Equipment will be able to receive or
transmit communication signals without interference or
disturbance (whether or not by reason of the installation or
use of similar equipment by others on the roof of the Project)
and Tenant agrees that Landlord shall not be liable to Tenant
therefor.
Tenant shall (i) be solely responsible for any damage caused as a
result of the Communication Equipment, (ii) promptly pay any
tax, license or permit fees charged pursuant to any laws or
regulations in connection with the installation, maintenance
or use of the Communication Equipment and comply with all
precautions and safeguards recommended by all governmental
authorities, and (iii) pay for all necessary repairs,
replacements to or maintenance of the Communication Equipment.
The Communication Equipment shall remain the sole property of Tenant.
Tenant shall remove the Communication Equipment and related
equipment at Tenant's sole cost and expense upon the
expiration or sooner termination of this Lease or upon the
imposition of any governmental law or regulation which may
require removal, and shall repair the Project upon such
removal to the extent required by such work of removal. If
Tenant fails to remove the Communication Equipment and repair
the Project within fifteen (15) days after the expiration or
earlier termination of this Lease, Landlord may do so at
Tenant's expense. The provisions of this Section 4(h) shall
survive the expiration or earlier termination of this Lease.
The Communication Equipment shall be deemed to constitute a portion of
the Premises for purposes of Articles 13 and 14 of this Lease.
HOLDING OVER
Should Tenant, without Landlord's written consent, hold over after
termination of this Lease, Tenant shall become a tenant from month-to-month,
only upon each and all of the terms herein provided as may be applicable to a
month-to-month tenancy and any such holding over shall not constitute an
extension of this Lease. During such holding over, Tenant shall pay in advance,
monthly, rent at one hundred fifty percent (150%) of the rate in effect for the
last month of the Term of this Lease, in addition to, and not in lieu of, all
other payments (other than Basic Rental) required to be made by Tenant hereunder
including but not limited to Tenant's Proportionate Share of any increase in
Direct Costs. Nothing contained in this Article 5 shall be construed as consent
by Landlord to any holding over of the Premises by Tenant, and Landlord
expressly reserves the right to require Tenant to surrender possession of the
Premises to Landlord as provided in this Lease upon the expiration or earlier
termination of the Term. If, without Landlord's prior written consent, Tenant
fails to surrender the Premises upon the expiration or termination of this
Lease, Tenant agrees to indemnify, defend and hold Landlord harmless from
10
Initials: ____
____
all costs, loss, expense or liability, including without limitation, claims
made by any succeeding tenant and real estate brokers claims and attorney's
fees.
PERSONAL PROPERTY TAXES
Tenant shall pay, prior to delinquency, all taxes assessed against or
levied upon trade fixtures, furnishings, equipment and all other personal
property of Tenant located in the Premises. In the event any or all of Tenants
trade fixtures, furnishings, equipment and other personal property shall be
assessed and taxed with property of Landlord, or if the cost or value of any
leasehold improvements in the Premises exceeds the cost or value of a
Project-standard buildout as determined by Landlord and, as a result, real
property taxes for the Project are increased, Tenant shall pay to Landlord its
share of such taxes within thirty (30) days after delivery to Tenant by Landlord
of a statement in writing setting forth the amount of such taxes applicable to
Tenant's property or above-standard improvements. Tenant shall assume and pay to
Landlord at the time of paying Basic Rental any excise, sales, use, rent,
occupancy, garage, parking, gross receipts or other taxes (other than net income
taxes) which may be imposed on or on account of letting of the Premises or the
payment of Basic Rental or any other sums due or payable hereunder, and which
Landlord may be required to pay or collect under any law now in effect or
hereafter enacted. Tenant shall pay directly to the party or entity entitled
thereto all business license fees, gross receipts taxes and similar taxes and
impositions which may from time to time be assessed against or levied upon
Tenant, as and when the same become due and before delinquency. Notwithstanding
anything to the contrary contained herein, any sums payable by Tenant under this
Article 6 shall not be included in the computation of "Tax Costs."
USE
Tenant shall use and occupy the Premises only for the use set forth in
Article 1.G. of the Basic Lease Provisions and shall not use or occupy the
premises or permit the same to be used or occupied for any other purpose without
the prior written consent of Landlord, which consent may be given or withheld in
Landlord's sole and absolute discretion, and Tenant agrees that it will use the
Premises in such a manner so as not to interfere with or infringe the rights of
other tenants in the Project. Tenant shall not violate the laws, statutes,
ordinances and governmental regulations or requirements now in force or which
may hereafter be in force relating to or affection (i) the condition, use or
occupancy of the Premises or the Project excluding structural changes to the
Project not related to Tenant's particular use of the Premises, and (ii)
improvements installed or constructed in the Premises by or for the benefit of
Tenant. Tenant shall not do or permit to be done anything which would invalidate
or increase the cost of any fire and extended coverage insurance policy covering
the Project and/or the property located therein and Tenant shall not violate the
rules, orders, regulations and requirements of any organization which sets out
standards, requirements or recommendations commonly referred to by major fire
insurance underwriters. Tenant shall promptly upon demand reimburse Landlord for
any additional premium charges for any such insurance policy assessed or
increased by reason of Tenant's violation of the provisions of this Article.
Landlord shall take the necessary steps to comply with what Landlord reasonably
believes are the requirements of the Americans
11
Initials: ____
____
With Disabilities Act ("ADA") in effect as of the date of this Lease as it
pertains to the common areas within the Project including, without
limitation, restrooms and elevators. Operating Costs shall not include any
cost incurred by Landlord in connection with upgrading the Project to comply
with the requirements of the ADA that are in effect as of the date of this
Lease, including penalties or damages incurred due to such noncompliance.
Tenant shall, at its sole cost and expense, be responsible for complying with
ADA requirements within the Premises following Landlord's delivery of the
Premises to Tenant.
CONDITION OF PREMISES
The Premises shall be initially improved as provided in, and subject
to, the Tenant Work Letter attached hereto as Exhibit "D" and made a part
hereof. The taking of possession of the Premises by Tenant shall conclusively
establish that the Premises and the Project were at such time in satisfactory
condition, subject to punch list items and any latent design and construction
defects. Tenant hereby waives Sections 1941 and 1942 of the Civil Code of
California or any successor provision of law.
Landlord reserves the right from time to time, but subject to payment
by and/or reimbursement from Tenant as otherwise provided herein: (i) to
install, use, maintain, repair, replace and relocate for service to the Premises
and/or other parts of the Project pipes, ducts, conduits, wires, appurtenant
fixtures, and mechanical systems, wherever located in the Premises or the
Project, (ii) to alter, close or relocate any facility in the Premises or the
Common Areas or otherwise conduct any of the above activities for the purpose of
complying with a general plan for fire/life safety for the Project or otherwise
and (iii) to comply with any federal, state or local law, rule or order with
respect thereto or the regulation thereof not currently in effect. Landlord
shall attempt to perform any such work with the least inconvenience to Tenant as
possible, but in no event shall Tenant be permitted to withhold or reduce Basic
Rental or other charges due hereunder as a result of same or otherwise make
claim against Landlord for interruption or interference with Tenant's business
and/or operations.
REPAIRS AND ALTERATIONS
Landlord shall maintain the structural portions of the Project
including the foundation, floor/ceiling slabs, roof, curtain wall, exterior
glass, columns, beams, shafts, stairs, stairwells, elevator cabs and common
areas and shall also maintain and repair the basic mechanical, electrical,
lifesafety, plumbing, sprinkler systems and heating, ventilating and
air-conditioning systems (provided, however, that Landlord's obligation with
respect to any such systems shall be to repair and maintain those portions of
the systems located in the core of the Project or in other areas outside of the
Premises, but Tenant shall be responsible to repair and maintain any
distribution of such systems throughout the Premises). Except as expressly
provided as Landlord's obligation in this Article 9, Tenant shall keep the
Premises in good condition and repair. All damage or injury to the Premises or
the Project caused by the act or negligence of Tenant, its employees, agents or
visitors, guests, invitees or licensees or by the use of the Premises shall be
promptly repaired by Tenant, at its sole cost and expense, but only to the
extent such damage or injury is not covered by insurance, to the satisfaction of
Landlord; provided,
12
Initials: ____
____
however, that for damage to the Project as a result of casualty, Landlord
shall have the right (but not the obligation) to select the contractor and
oversee all such repairs. Landlord may make any repairs which are not promptly
made by Tenant after Tenant's receipt of written notice and the reasonable
opportunity of Tenant to make said repair within thirty (30) days from receipt
of said written notice, and charge Tenant for the cost thereof, which cost
shall be paid by Tenant within fifteen (15) days from invoice from Landlord.
Tenant shall be responsible for the design and function of all non-standard
improvements of the Premises, whether or not installed by Landlord at Tenant's
request. Tenant waives all rights to make repairs at the expense of Landlord,
or to deduct the cost thereof from the rent. Tenant shall make no alterations,
changes or additions in or to the Premises without Landlord's prior written
consent, and then only by contractors or mechanics approved by Landlord in
writing and upon the approval by Landlord in writing of fully detailed and
dimensioned plans and specifications pertaining to the work in question, to be
prepared and submitted by Tenant at its sole cost and expense. Tenant shall at
its sole cost and expense obtain all necessary approvals and permits
pertaining to any work approved by Landlord. If Landlord, in approving any
work, specifies a Commencement Date therefor, Tenant shall not commence any
work prior to such date. If permitted alterations, changes, or additions are
made, they shall be made at Tenant's sole cost and expense and shall be and
become the property of Landlord, except that Landlord may, by written notice
to Tenant given at least thirty (30) days prior to the end of the Term,
require Tenant at Tenant's expense to remove all partitions, counters,
railings and the like installed by Tenant, and to repair any damages to the
Premises caused by such removal. Any and all costs attributable to or related
to the applicable building codes of the city in which the Project is located
(or any other authority having jurisdiction over the Project) arising from
Tenants plans, specifications, improvements, alterations or otherwise shall be
paid by Tenant at its sole cost and expense. With regard to repairs,
alterations or any other work arising from or related to this Article 9,
Landlord shall be entitled to receive an administrative/supervision fee (which
fee shall vary depending upon whether or not Tenant orders the work directly
from Landlord but which fee shall in no event exceed five percent (5%) of the
cost of such work) sufficient to compensate Landlord for all overhead, general
conditions, fees and other costs and expenses arising from Landlord's
involvement with such work. The construction of initial improvements to the
Premises shall be governed by the terms of the Tenant Work Letter and not the
terms of this Article 9.
LIENS
Tenant shall keep the Premises and the Project free from any mechanics'
liens, vendors liens or any other liens arising out of any work performed,
materials furnished or obligations incurred by Tenant. Before commencing any
work of alteration, addition or improvement to the Premises, Tenant shall given
Landlord at least ten (10) business days' written notice of the proposed
commencement of such work (to afford Landlord an opportunity to post appropriate
notices of non-responsibility). In the event that there shall be recorded
against the Premises or the Project or the property of which the Premises is a
part any claim or lien arising out of any such work performed, materials
furnished or obligations incurred by Tenant and such claim or lien shall not be
removed or discharged by Tenant within thirty (30) days of notice by Tenant to
Landlord, Landlord shall have the right but not the obligation to pay and
discharge said lien without regard to whether such lien shall be lawful or
correct or to require that Tenant deposit
13
Initials: ____
____
with Landlord in cash, lawful money of the United States, on hundred fifty
percent (150%) of the amount of such claim, which sum may be retained by
Landlord until such claim shall have been removed of record or until judgment
shall have been rendered on such claim and such judgment shall have become
final, at which time Landlord shall have the right to apply such deposit in
discharge of the judgment on said claim and any costs, including attorneys'
fees incurred by Landlord, and shall remit the balance thereof to Tenant.
PROJECT SERVICES
Landlord agrees to furnish to the Premises, at a cost to be included in
Operating Costs, from 8:00 a.m. to 6:00 p.m. Mondays through
Fridays and 9:00 a.m. to 1:00 p.m. on Saturdays, excepting
local and national holidays, air conditioning and heat all in
such reasonable quantities as in the judgment of Landlord is
reasonably necessary for the comfortable occupancy of the
Premises. In addition, Landlord shall provide electric current
for normal lighting and normal office machines, elevator
service and water on the same floor as the Premises for
lavatory and drinking purposes in such reasonable quantities
as in the judgment of Landlord is reasonably necessary for
general office use. Janitorial and maintenance services shall
be furnished five (5) days per week, excepting local and
national holidays. Tenant shall comply with all rules and
regulations which Landlord may reasonably establish for the
proper functioning and protection of the common area air
conditioning, heating, elevator, electrical intrabuilding
network cable and plumbing systems. Landlord shall not be
liable for, and there shall be no rent abatement as a result
of, any stoppage, reduction or interruption of any such
services caused by governmental rules, regulations or
ordinances, riot, strike, labor disputes, breakdowns,
accidents, necessary repairs or other cause. Except as
specifically provided in this Article 11, Tenant agrees to pay
for all utilities and other services utilized by Tenant and
additional building services furnished to Tenant not uniformly
furnished to all tenants of the Project at the rate generally
charged by Landlord to tenants of the Project.
Tenant will not, without the prior written consent of Landlord, use
any apparatus or device in the Premises which will in any way
increase the amount of electricity or water usually furnished
or supplied for use of the Premises as general office space;
nor connect any apparatus, machine or device with water pipes
or electric current (except through existing electrical
outlets in the Premises), for the purpose of using electric
current or water.
If Tenant shall require electric current in excess of that which
Landlord is obligated to furnish under Article 11(b) above,
Tenant shall first obtain the written consent of Landlord,
which Landlord may refuse in its sole and absolute discretion,
to the use thereof and Landlord may cause an electric current
meter or submeter to be installed in the Premises to measure
the amount of such excess electric current consumed by Tenant
in the Premises. The cost of any such meter and of
installation, maintenance and repair thereof shall be paid for
by Tenant and
14
Initials: ____
____
Tenant agrees to pay to Landlord, promptly upon demand
therefore by Landlord, for all such excess electriccurrent
consumed by any such use as shown by said meter at the
rates charged for such service by the city in which the
Project is located or the local public utility, as the case
may be, furnishing the same, plus any additional expense
incurred by Landlord in keeping account of the electric
current so consumed.
If any lights, machines or equipment (including by not limited to
computers) are used by Tenant in the Premises which materially
affect the temperature otherwise maintained by the air
conditioning system, or generate substantially more heat in
the Premises than would be generated by the building standard
lights and usual office equipment, Landlord shall have the
right to install any machinery and equipment which Landlord
reasonably deems necessary to restore temperature balance,
including but not limited to modifications to the standard air
conditioning equipment, and the cost thereof, including the
cost of installation and any additional cost of operation and
maintenance occasioned thereby, shall be paid by Tenant to
Landlord upon demand by Landlord. Landlord shall not be liable
under any circumstances for loss of or injury to property,
however occurring, through or in connection with or incidental
to failure to furnish any of the foregoing.
If Tenant requires heating, ventilation and/or air conditioning during
times other than the times provided in Article 11(a) above,
Tenant shall given Landlord such advance notice as Landlord
shall reasonably require and shall pay Landlord's standard
charge for such after-hours use.
Landlord may impose a reasonable charge for any utilities or services
(other than electric current and heating, ventilation and/or
air conditioning which shall be governed by Articles 11(c) and
(e) above) utilized by Tenant in excess of the amount or type
that Landlord reasonably determines is typical for the use set
forth in Article 1.G. of this Lease.
In the event that Tenant is prevented from using, and does not use, the
Premises or any portion thereof, as a result of any failure to
provide services or access to the Premises (an "Abatement
Event"), then Tenant shall give Landlord notice ("Abatement
Notice") of such Abatement Event, and if such Abatement Event
continues beyond the "Eligibility Period" (as that term is
defined below), then the Basic Rental and Tenant's
Proportionate Share of Direct Costs and Tenant's obligation to
pay for parking shall be abated entirely or reduced, as the
case may be, after expiration of the Eligibility Period for
such time that Tenant continues to be so prevented from using,
and does not use, the Premises or a portion thereof, in the
proportion that the rentable area of the portion of the
Premises that Tenant is prevented from using, and does not
use, bears to the total rental area of the Premises; provided,
however, in the event that Tenant is prevented from using, and
does not use, a portion o the Premises for a period of time in
excess of the Eligibility Period and the remaining portion of
the Premises is not sufficient to allow Tenant to effectively
conduct its business therein, and if Tenant does not
15
Initials: ____
____
conduct its business from such remaining portion, then for
such time after expiration of the Eligibility Period
during which Tenant is so prevented from effectively
conduction its business therein, the Basic Rental and
Tenant's Proportionate Share of Direct Costs and Tenant's
obligation to pay for parking for the entire Premises shall
be abated entirely for such time as Tenant continues to be
so prevented from using, and does not use, the Premises.
If, however, Tenant reoccupies any portion of the Premises
during such period, the rent allocable to such reoccupied
portion, based on the proportion that the rentable area of
such reoccupied portion of the Premises bears to the total
rentable area of the Premises, shall be payable by Tenant
from the date Tenant reoccupies such portion of the
Premises. The term "Eligibility Period" shall mean a period
of five (5) consecutive business days after Landlord's
receipt of any Abatement Notice(s). Such right to xxxxx
Basic Rental and Tenant's Proportionate Share of Direct
Costs shall be Tenant's sole and exclusive remedy at law or
in equity for an Abatement Event.
RIGHTS OF LANDLORD
Landlord and its agents shall have the right to enter the Premises at
all reasonable times for the purpose of cleaning the Premises, examining or
inspecting the same, serving or posting and keeping posted thereon notices as
provided by law, or which Landlord deems necessary for the protection of
Landlord or the Property, showing the same to prospective tenants or purchasers
of the Project, in the case of an emergency, and for making such alterations,
repairs, improvements or additions to the Premises or to the Project as Landlord
may deem necessary or desirable. If Tenant shall not be personally present to
open and permit an entry into the Premises at any time when such an entry by
Landlord is necessary or permitted hereunder, Landlord may enter by means of a
master key or may enter forcibly, only in the case of an emergency, without
liability to Tenant and without affecting this Lease. In exercising its rights
under Article 12, Landlord shall use commercially reasonable efforts to minimize
interference with Tenant's operations in the Premises.
INDEMNITY; EXEMPTION OF LANDLORD FROM LIABILITY
INDEMNITY. Tenant shall indemnify, defend and hold Landlord harmless
from (i) any and all claims arising from Tenant's use of the
Premises or the Project or from the conduct of its business or
from any activity, work or thing which may be permitted or
suffered by Tenant in or about the Premises or the Project,
(ii) any and all claims arising from any breach or default in
the performance of any obligation on Tenant's part to be
performed under this Lease or arising from any negligence of
Tenant or any of its agents, contractors, employees or
invitees, patrons, customers or members in or about the
Project, (iii) any and all costs, attorneys' fees, expenses
and liabilities incurred in the defense of any claim or any
action or proceeding brought thereon, including negotiations
in connection therewith, (iv) all liens and claims of lien,
and all other liability, claims and
16
Initials: ____
____
demands arising out of any work done or material supplied
to the Premises by or at the request of Tenant, (v) any and
all claims, judgments, damages, penalties, fines, costs,
liabilities, or losses (including, without limitation,
diminution in value of the Project, damages for the loss or
restriction or use of rentable or usable space or of any
amenity of the Project, damages arising from any adverse
impact or marketing of space in the Project, and sums paid
in settlement of claims, attorneys' fees, consultant fees,
and expert fees) which arise during or after the Term of
this Lease as a result of Tenant's breach of the provisions
of Section 28(a) of this Lease, which indemnification of
Landlord by Tenant includes, without limitation, costs
incurred in connection with any investigation of site
conditions or any cleanup, remedial, removal or restoration
work required by any federal, state, or local governmental
agency or political subdivision because of Hazardous
Material present in the soil or ground water on or under
the Project, and (vi) any such lien or claim or action
thereon, together with costs of suit and reasonable
attorneys' fees incurred by Landlord in connection with any
such claim or action. Tenant hereby assumes all risk of
damage to property or injury to persons in or about the
Premises from any cause, and Tenant hereby waives all
claims in respect thereof against Landlord; provided that
Tenant shall not be required to indemnify and/or hold
Landlord harmless from any loss, cost, liability, damage or
expense, including, but not limited to, penalties, fines,
attorneys' fees or costs (collectively, "Claims"), to any
person, property or entity resulting from the negligence or
willful misconduct of Landlord or its agents, contractors,
or employees, in connection with Landlord's activities in
the Project (except for damage to the Tenant Improvements
and Tenant's personal property, fixtures, furniture and
equipment in the Premises, to the extent Tenant is required
to obtain the requisite insurance coverage pursuant to this
Lease), the Landlord hereby so indemnifies and hold Tenant
harmless from any such Claims; provided further that
because Landlord maintains insurance on the Project and
Tenant compensates Landlord for such insurance as part of
Tenant's Proportionate Share of Direct Costs and because of
the existence of waivers of subrogation set forth in
Article 14 of this Lease, Landlord hereby indemnifies and
holds Tenant harmless from any Claims to any property
outside of the Premises to the extent such Claim is covered
by such insurance, even if resulting from the negligent
acts, omissions, or willful misconduct of Tenant or those
of its agents contractors, or employees. Similarly, since
Tenant must carry insurance pursuant to Article 14 to cover
its personal property within the Premises and the Tenant
Improvements, Tenant hereby indemnifies and holds Landlord
harmless from any Claim to any property within the
Premises, to the extent such Claim is covered by such
insurance, even if resulting from the negligent acts,
omissions or willful misconduct of Landlord or those of its
agents, contractors, or employees.
EXEMPTIONOF LANDLORD FROM LIABILITY. Landlord shall not be liable for
injury to Tenant's business, or loss of income therefrom, or
from damage that may be sustained by the person, goods, wares,
merchandise or property of Tenant, its employees, invitees,
customers, agents, or contractors, or any other person in, on
or about the Premises directly or indirectly caused by or
resulting from fire, steam, electricity,
17
Initials: ____
____
gas, water or rain which may leak or flow from or into any
part of the Premises, or from the breakage, leakage,
obstruction or other defects of the pipes, sprinklers,
wires, appliances, plumbing, air conditioning, light
fixtures, or mechanical or electrical systems or from
intrabuilding network cable, whether such damage or injury
results from conditions arising upon the Premises or upon
other portions of the Project or from other sources or
places and regardless of whether the cause of such damage
or injury or the means or repairing the same is
inaccessible to Tenant, except in connection with damage or
injury resulting from the gross negligence or willful
misconduct of Landlord, or its authorized agents. Landlord
shall not be liable to Tenant for any damages arising form
any act or neglect of any other tenant of the building.
Tenant acknowledges that Landlord's election to provide mechanical
surveillance or to post security personnel in the Project is solely within
Landlord's discretion; Landlord shall have no liability in connection with the
decision whether or not to provide such services and Tenant hereby waives all
claims based thereon. Landlord shall not be liable for losses due to theft,
vandalism, or like causes.
INSURANCE
TENANT'S INSURANCE. Tenant shall, at all times during the Term of this
Lease, and at its own costs and expense, procure and continue
in force the following insurance coverage: (i) Commercial
General Liability Insurance with a combined single limit for
bodily injury and property damages of not less than One
Million Dollars ($1,000,000) per occurrence and Two Million
Dollars ($2,000,000) in the annual aggregate, including
products liability coverage if applicable, covering the
insuring provisions of this Lease and the performance of
Tenant of the indemnity and exemption of Landlord from
liability agreements set forth in Article 13 hereof; (ii) a
policy of standard fire, extended coverage and special
extended coverage insurance (al risks), including a vandalism
and malicious mischief endorsement, sprinkler leakage coverage
and earthquake sprinkler leakage where sprinklers are provided
in an amount equal to the full replacement value new without
deduction for depreciation of all (A) Tenant Improvements,
alterations, fixtures and other improvements in the Premises
and (B) trade fixtures, furniture, equipment and other person
property installed by or at the expense of Tenant; (iii)
Worker's Compensation coverage as required by law; and (iv)
business interruption, loss of income and extra expense
insurance covering failure of Tenant's telecommunications
equipment and covering all other perils, failures or
interruptions. Tenant shall carry and maintain during the
entire Lease Term (including any option periods, if
applicable), at Tenant's sole cost and expense, increased
amounts of the insurance required to be carried by Tenant
pursuant to this Article 14 and such other reasonable types of
insurance coverage and in such reasonable amounts covering the
Premises and Tenant's operations therein, as may be reasonably
required by Landlord.
18
Initials: ____
____
FORM OF POLICIES. The aforementioned minimum limits of policies and
Tenant's procurement and maintenance thereof shall in no event
limit the liability of Tenant hereunder. The Commercial
General Liability Insurance policy shall name Landlord,
Landlord's property manager, Landlord's lender(s) and such
other persons or firms as Landlord specifies from time to
time, as additional insureds; with an appropriate endorsement
to the policy(s). All such insurance policies carried by
Tenant shall be with companies having a rating of not less
than A-VIII in Best's Insurance Guide. Tenant shall furnish to
Landlord, from the insurance companies, or cause the insurance
companies to furnish, certificates of coverage. No such policy
shall be cancelable or subject to reduction of coverage or
other modification or cancellation except after thirty (30)
days prior written notice to Landlord by the insurer. All such
policies shall be endorsed to agree that Tenant's policy is
primary and that any insurance covered by Landlord is excess
and not contributing with any Tenant insurance requirement
hereunder. Tenant shall, at least twenty (20) days prior to
the expiration of such policies, furnish Landlord with
renewals or binders. Tenant agrees that if Tenant does not
take out and maintain such insurance or furnish Landlord with
renewals or binders, Landlord may (but shall not be required
to) procure said insurance on Tenant's behalf and charge
Tenant the cost thereof, which amount shall be payable by
Tenant upon demand with interest from the date such sums are
extended. Tenant shall have the right to provide such
insurance coverage pursuant to blanket policies obtained by
Tenant, provided such blanket policies expressly afford
coverage to the Premises and to Tenant as required by this
Lease.
LANDLORD'S INSURANCE. Landlord shall, as a cost to be included in
Operating Costs, procure and maintain at all times during the
Term of this Lease, a policy or policies of insurance covering
loss or damage to the Project in the amount of the full
replacement costs without deduction for depreciation thereof
(exclusive of Tenant's trade fixtures, inventory, personal
property and equipment), providing protection against all
perils included within the classification of fire and extended
coverage, vandalism coverage and malicious mischief, sprinkler
leakage, water damage, and special extended coverage on
building. Additionally, Landlord may (but shall not be
required to) carry: (i) Bodily Injury and Property Damage
Liability Insurance and/or Excess Liability Coverage
Insurance; and (ii) Earthquake and/or Flood Damage Insurance;
and (iii) Rental Income Insurance at its election or if
required by its lender from time to time during the Term
hereof, in such amounts and with such limits as Landlord or
its lender may deem appropriate. The costs of such insurance
shall be included in Operating Costs.
WAIVER OF SUBROGATION. Landlord and Tenant each agree to have their
respective insurers issuing the insurance described in
Sections 14(a)(ii), 14(a)(iv) and the first sentence of
Section 14(c) waive any rights of subrogation that such
companies may have against the other party. Tenant hereby
waives any right that Tenant may have against Landlord and
Landlord hereby waives any right that Landlord
19
Initials: ____
____
may have against Tenant as a result of any loss or damage
to the extent such loss or damage is insurable under such
policies.
COMPLIANCE WITH LAW. Tenant agrees that it will not, at any time,
during the Term of this Lease, carry any stock of goods or do
anything in or about the Premises that will in any way tend to
increase the insurance rates upon the Project. Tenant agrees
to pay Landlord forthwith upon demand the amount of any
increase in premiums for insurance against loss by fire that
may be charged during the Term of this Lease on the amount of
insurance to be carried by Landlord on the Project resulting
from the foregoing, or from Tenant doing any act in or about
said Premises that does so increase the insurance rates,
whether or not Landlord shall have consented to such act on
the part of Tenant. If Tenant installs upon the Premises any
electrical equipment which constitutes an overload of
electrical lines of the Premises, Tenant shall at its own cost
and expense in accordance with all other Lease provisions, and
subject to the provisions of Article 9, 10 and 11, hereof,
make whatever changes are necessary to comply with
requirements of the insurance underwriters and any
governmental authority having jurisdiction thereover, but
nothing herein contained shall be deemed to constitute
Landlord's consent to such overloading. Tenant shall, at its
own expense, comply with all requirements of the insurance
authority having jurisdiction over the Project necessary for
the maintenance of reasonable fire and extended coverage
insurance for the Premises, including without limitation
thereto, the installation of fire extinguishers or an
automatic dry chemical extinguishing system.
ASSIGNMENT AND SUBLETTING
Tenant shall have no power to, either voluntarily, involuntarily, by
operation of law or otherwise, sell, assign, transfer or hypothecate this Lease,
or sublet the Premises or any part thereof, or permit the Premises or any part
thereof to be used or occupied by anyone other than Tenant or Tenant's employees
without the prior written consent of Landlord which shall not be unreasonably
withheld. If Tenant is a corporation, unincorporated association, partnership or
limited liability company, the sale, assignment, transfer or hypothecation of
any class of stock or other ownership interest in such corporation, association,
partnership or limited liability company in excess of twenty-five percent (25%)
in the aggregate shall be deemed an assignment within the meaning and provisions
of this Article 15. Tenant may transfer its interest pursuant to this Lease only
upon the following express conditions, which conditions are agreed by Landlord
and Tenant to be reasonable:
That the proposed transferee shall be subject to the prior written
consent of Landlord, which consent will not be unreasonably
withheld but, without limiting the generality of the
foregoing, it shall be reasonable for Landlord to deny such
consent if:
The use to be made of the Premises by the proposed transferee
is (a) not generally consistent with the character
and nature of all other tenancies in the Project, or
(b) a use which conflicts with any so-called
"exclusive" then in
20
Initials: ____
____
favor of, or for any use which is the same as that
stated in any percentage rent lease to, another
tenant of the Project or any other buildings which
are in the same complex as the Project, or (c) a use
which would be prohibited by any other portion of
this Lease (including but not limited to any rules
and Regulations then in effect); or
The financial responsibility of the proposed transferee is not
reasonably satisfactory to Landlord or in any event
not at least equal to those which were possessed by
Tenant as of the date of execution of this Lease;
Whether or not Landlord consents to any such transfer, Tenant shall
pay to Landlord Landlord's then standard processing fee and
reasonable attorneys' fees incurred in connection with the
proposed transfer up to the aggregate sum of $1,500.00;
Thatthe proposed transferee shall execute an agreement pursuant to
which it shall agree to perform faithfully and be bound by all
of the terms, covenants, conditions, provisions and agreements
of this Lease applicable to that portion of the Premises so
transferred; and
That an executed duplicate original of said assignment and assumption
agreement or other transfer on a form reasonably approved by
Landlord, shall be delivered to Landlord within fifteen (15)
days after the execution thereof, and that such transfer shall
not be binding upon Landlord until the delivery thereof to
Landlord and the execution and delivery of Landlord's consent
thereto. It shall be a condition to Landlord's consent to any
subleasing, assignment or other transfer of part or all of
Tenant's interest in the Premises hereinafter referred to as a
"Transfer") that (i) upon Landlord's consent to any Transfer,
Tenant shall pay and continue to pay fifty percent (50%) of
any "Transfer Premium" (defined below), received by Tenant
from the transferee; (ii) any sublessee of part or all of
Tenant's interest in the Premises shall agree that in the
event Landlord gives such sublessee notice that Tenant is in
default under this Lease, such sublessee shall thereafter make
all sublease or other payments directly to Landlord, which
will be received by Landlord without any liability whether or
honor the sublease or otherwise (except to credit such
payments against sums due under this Lease), and any sublessee
shall agree to attorn to Landlord or its successors and
assigns at their request should this Lease be terminated for
any reason, except that in no event shall Landlord or its
successors as assigns be obligated to accept such attornment;
(iii) any such Transfer and consent shall be effected on forms
supplied by Landlord and/or its legal counsel; (iv) Landlord
may require that Tenant not then be in default hereunder in
any respect; and (v) Tenant or the proposed subtenant or
assignee (collectively, "Transferee") shall agree to pay
Landlord, upon demand, as additional rent, a sum equal to the
additional costs, if any, incurred by Landlord for maintenance
and repair as a result of any change in the nature of
occupancy caused by such subletting or assignment. "Transfer
Premium" shall mean all rent, additional rent or other
consideration payable by a Transferee in connection with a
Transfer in excess of the rent and Additional Rent payable by
Tenant under this
21
Initials: ____
____
Lease during the term of the Transfer and if such Transfer
is less than all of the Premises, the Transfer Premium
shall be calculated on a rentable square foot basis.
"Transfer Premium" shall also include, but not be limited
to, key money, bonus money or other cash consideration paid
by a transferee to Tenant in connection with such Transfer,
and any payment in excess of fair market value for services
rendered by Tenant to the Transferee and any payment in
excess of fair market value for assets, fixtures,
inventory, equipment, or furniture transferred by Tenant to
the Transferee in connection with such Transfer. Any sale
assignment, hypothecation, transfer or subletting of this
Lease which is not in compliance with the provisions of
this Article 15 shall be void and shall, at the option of
Landlord, terminate this Lease. In no event shall the
consent by Landlord to an assignment or subletting be
construed as relieving Tenant, any assignee, or sublessee
from obtaining the express written consent of Landlord to
any further assignment or subletting, or as releasing
Tenant from any liability or obligation hereunder whether
or not then accrued and Tenant shall continue to be fully
liable therefor. No collection r acceptance of rent by
Landlord from any person other than Tenant shall be deemed
a waiver of any provision of this Article 15 or the
acceptance of any assignee or subtenant hereunder, or a
release of Tenant (or of any successor of Tenant or any
subtenant). Notwithstanding anything to the contrary in
this Lease, if Tenant or any proposed Transferee claims
that Landlord has unreasonably withheld or delayed its
consent under this Article 15 or otherwise has breached or
acted unreasonably under this Article 15, their sole
remedies shall be a declaratory judgment and an injunction
for the relief sought without any monetary damages, and
Tenant hereby waives all other remedies, including, without
limitation, any right at law or equity to terminate this
Lease, on its own behalf and, to the extent permitted under
all applicable laws, on behalf of the proposed Transferee.
Notwithstanding anything to the contrary contained in this Article 15,
Landlord shall have the option, by giving written notice to Tenant within thirty
(30) days after Landlord's receipt of a request for consent to a proposed
Transfer, to terminate this Lease as to the portion of the Premises that is the
subject of the Transfer for the period of the proposed Transfer. If this Lease
is so terminated with respect to less than the entire Premises, the Basic Rental
and Tenant's Proportionate Share shall be prorated based on the number of
rentable square feet retained by Tenant as compared to the total number of
rentable square feet contained in the original Premises, and this Lease as so
amended shall continue thereafter in full force and effect, and upon the request
of either party, the parties shall execute written confirmation of the same.
Notwithstanding anything to the contrary contained in this Article 15,
an assignment or subletting of all or a portion of the
Premises to an affiliate of Tenant (an entity which is
controlled by, controls, or is under common control with
Tenant), shall not require Landlord's consent and shall not
otherwise be subject to the provisions of this Article 15,
provided that Tenant notifies Landlord of any such assignment
or sublease and promptly supplies Landlord with any documents
or information requested by Landlord regarding such assignment
or sublease or such affiliate, and further provided that such
assignment or sublease is not a subterfuge by
22
Initials: ____
____
Tenant to avoid its obligations under this Lease. The term
"control" as used in this Section 15(e) shall mean the
ownership, directly or indirectly, of greater than fifty
percent (50%) of the voting securities of, or possession of,
in the ordinary direction of affairs, at least fifty-one
percent (51%) of the voting interest in, any entity.
DAMAGE OR DESTRUCTION
If the Project is damaged by fire or other insured casualty and the
insurance proceeds have been made available therefor by the holder or holders
of any mortgages or deeds of trust covering the Premises or the Project, the
damage shall be repaired by Landlord to the extent such insurance proceeds are
available therefor and provided such repairs can, in Landlord's sole opinion,
be completed within one hundred eighty (180) days after the necessity for
repairs as a result of such damage becomes known to Landlord without the
payment of overtime or other premiums, and until such repairs are completed
rent shall be abated in proportion to the part of the Premises which is
unusable by Tenant in the conduct of its business (but there shall be no
abatement of rent by reason of any portion of the Premises being unusable for
a period equal to one (1) day or less). Upon the occurrence of any damage to
the Premises, Tenant shall assign to Landlord (or to any party designated by
Landlord) all insurance proceeds payable to Tenant under Section 14(a)(ii)(A)
above; provided, however, that if the cost of repair of improvements within
the Premises by Landlord exceeds the amount of insurance proceeds received by
Landlord from Tenant's insurance carrier, as so assigned by Tenant, such
excess costs shall be paid by Tenant to Landlord prior to Landlord's repair of
such damage. Within sixty (60) days after the date Landlord learns of the
necessity for repairs as a result of damage, Landlord shall notify Tenant
("Damage Repair Estimate") of Landlord's estimated assessment of the period of
time in which the repairs will be completed. If repairs cannot, in Landlord's
opinion, be completed within one hundred eighty (180) days after the necessity
for repairs as a result of such damage becomes known to Landlord without the
payment of overtime or other premiums, Landlord may, at its option, either (i)
make them in a reasonable time and in such event this Lease shall continue in
effect and the rent shall be abated, if at all, in the manner provided in this
Article 16, or (ii) elect not to effect such repairs and instead terminate
this Lease, by notifying Tenant in writing of such termination within sixty
(60) days after Landlord learns of the necessity for repairs as a result of
damage, such notice to include a termination date giving Tenant sixty (60)
days to vacate the Premises. In addition, Landlord may elect to terminate this
Lease if the Project shall be damaged by fire or other casualty or cause,
whether or not the Premises are affected, and the damage is not fully covered,
except for deductible amounts, by Landlord's insurance policies. However, if
Landlord does not elect to terminate this Lease pursuant to Landlord's
termination right as provided above, and the Damage Repair Estimate indicates
that repairs cannot be completed within one hundred eighty (180) days after
being commenced, Tenant may elect, not later than thirty (30) days after
Tenant's receipt of the Damage Repair Estimate, to terminate this Lease by
written notice to Landlord effective as of the date specified in Tenant's
notice. Finally, if the Premises or the Project is damaged to any substantial
extent during the last twelve (12) months of the Term, then notwithstanding
anything contained in this Article 16 to the contrary, Landlord shall have the
option to terminate this Lease by giving written notice to Tenant of the
exercise of such option within sixty (60) days after Landlord
23
Initials: ____
____
learns of the necessity for repairs as the result of such damage. In the event
that the Premises or the Project is destroyed or damaged to any substantial
extent during the last twelve (12) months of the Lease Term and if such damage
shall take longer than ninety (90) days to repair and if such damage is not
the result of negligence or willful misconduct of Tenant or Tenant's
employees, licensees, invitees or agents, then notwithstanding anything in
this Article 16 to the contrary, Tenant shall have the option to terminate
this Lease by written notice to Landlord of the exercise of such option within
sixty (60) days after Tenant learns of the necessity for repairs as the result
of such damage. A total destruction of the Project shall automatically
terminate this Lease. Except as provided in this Article 16, there shall be no
abatement of rent and no liability of Landlord by reason of any injury to or
interference with Tenant's business or property arising from such damage or
destruction or the making of any fixtures, appurtenances and equipment
therein. Tenant understands that Landlord will not carry insurance of any kind
on Tenant's furniture, furnishings, trade fixtures or equipment, and that
Landlord shall not be obligated to repair any damage thereto or replace the
same. Except for proceeds relating to Tenant's furniture, furnishings, trade
fixtures and equipment, Tenant acknowledges that Tenant shall have no right to
any proceeds of insurance relating to property damage. With respect to any
damage which Landlord is obligated to repair or elects to repair, Tenant, as a
material inducement to Landlord entering into this Lease, irrevocably waives
and releases its rights under the provisions of Sections 1932 and 1933 of the
California Civil Code.
SUBORDINATION
This Lease is subject and subordinate to all ground or underlying
leases, mortgages and deeds of trust which affect the property or the Project,
including all renewals, modifications, consolidations, replacements and
extensions thereof; provided, however, if the lessor under any such lease or
the holder or holders of any such mortgage or deed of trust shall advise
Landlord that they desire or require this Lease to be prior and superior
thereto, upon written request of Landlord to Tenant, Tenant agrees to promptly
execute, acknowledge and deliver any and all documents or instruments which
Landlord or such lessor, holder or holders deem necessary or desirable for
purposes thereof. Landlord shall have the right to cause this Lease to be and
become and remain subject and subordinate to any and all ground or underlying
leases, mortgages or deeds of trust which may hereafter be executed covering
the Premises, the Project or the property or any renewals, modifications,
consolidations, replacements or extensions thereof, for the full amount of all
advances made or to be made thereunder and without regard to the time or
character of such advances, together with interest thereon and subject to all
the terms and provisions thereof; provided, however, that Landlord obtains
from the lender or other party in question a written undertaking in favor of
Tenant to the effect that such lender or other party will not disturb Tenant's
right of possession under this Lease if Tenant is not then or thereafter in
breach of any covenant or provision of this Lease. Tenant agrees, within
thirty (30) days after Landlord's written request therefor, to execute,
acknowledge and deliver upon request any and all documents or instruments
requested by Landlord or necessary or proper to assure the subordination of
this Lease to any such mortgages, deed of trust, or leasehold estates. Tenant
agrees that in the event any proceedings are brought for the foreclosure of
any mortgage or deed of trust or any deed in lieu thereof, to attorn to the
purchaser or any successors thereto upon any such foreclosure sale or deed in
lieu thereof as so requested to do so by such purchaser and to
24
Initials: ____
____
recognize such purchaser as the lessor under this Lease; Tenant shall, within
ten (10) days after request execute such further instruments or assurances as
such purchaser may reasonably deem necessary to evidence or confirm such
attornment. Tenant agrees to provide copies of any notices of Landlord's
default under this Lease to any mortgagee or deed of trust beneficiary whose
address has been provided to Tenant and Tenant shall provide such mortgagee or
deed of trust beneficiary, after receipt of such notice, the same amount of
time provided to Landlord under this Lease within which to cure any such
default. Tenant waives the provisions of any current or future statute, rule
of law which may give or purport to give Tenant any right or election to
terminate or otherwise adversely affect this Lease and the obligations of the
Tenant hereunder in the event of any foreclosure proceeding or sale.
EMINENT DOMAIN
If the whole of the Premises or the Project, or so much thereof as to
render the balance unusable by Tenant or so as to render the remaining
Premises unsuitable for the purpose specified in Article 1.G., shall be taken
under power of eminent domain, or is sold, transferred or conveyed in lieu
thereof, this Lease shall automatically terminate as of the date of such
condemnation. No award for any partial or entire taking shall be apportioned,
and Tenant hereby assigns to Landlord any award which may be made in such
taking or condemnation, together with any and all rights of Tenant now or
hereafter arising in or to the same or any part thereof; provided, however,
that nothing contained herein shall be deemed to give Landlord any interest in
or to require Tenant to assign to Landlord any award made to Tenant for the
taking of personal property and trade fixtures belonging to Tenant and
removable by Tenant at the expiration of the Term hereof as provided hereunder
or for the interruption of, or damage to, Tenant's business. In the event of a
partial taking described in this Article 18, or a sale, transfer or conveyance
in lieu thereof, which does not result in a termination of this Lease, the
rent shall be apportioned according to the ratio that the part of the Premises
remaining usable by Tenant bears to the total area of the Premises. Tenant
hereby waives any and all rights it might otherwise have pursuant to Section
1265.130 of the Code of Civil Procedure.
DEFAULT
Each of the following acts or omissions of Tenant or of any guarantor
of Tenant's performance hereunder, or occurrences, shall constitute an "Event
of Default":
Failure or refusal to pay Basic Rental, Additional Rent or any other
amount to be paid by Tenant to Landlord hereunder within ten
(10) calendar days after written notice that the same is due
or payable hereunder; said ten (10) day period shall be in
lieu of, and not in addition to, the notice requirements of
Section 1161 of the California Code of Civil Procedure or any
similar or successor law;
Except as set forth in items (a) above and (c) through and including
(f) below, failure to perform or observe any other covenant or
condition of this Lease to be performed or observed within
thirty (30) days following written notice to Tenant of such
failure; provided, however that if the nature of such default
is such that the same
25
Initials: ____
____
cannot be reasonably cured within a thirty (30) day period,
Tenant shall not be deemed to be in default if it diligently
commences such cure within such period and thereafter
diligently proceeds to cure such default. Such thirty (30)
day notice shall be in lieu of, and not in addition to, any
required under Section 1161 of the California Code of Civil
Procedure or any similar or successor law;
The taking in execution or by similar process or law (other than by
eminent domain) of the estate hereby created;
The filing by Tenant or any guarantor hereunder in any court pursuant
to any statute of a petition in bankruptcy or insolvency or
for reorganization or arrangement for the appointment of a
receiver of all or a portion of Tenant's property; the filing
against Tenant or any guarantor hereunder of any such
petition, or the commencement of a proceeding for the
appointment of a trustee, receiver or liquidator for Tenant,
or for any guarantor hereunder, or of any of the property of
either, or a proceeding by any governmental authority for the
dissolution or liquidation of Tenant or any guarantor
hereunder, if such proceeding shall not be dismissed or
trusteeship discontinued within thirty (30) days after
commencement of such proceeding or the appointment of such
trustee or receiver; or the making by Tenant or any guarantor
hereunder of an assignment for the benefit of creditors.
Tenant hereby stipulates to the lifting of the automatic stay
in effect and relief from such stay for Landlord in the event
Tenant files a petition under the United States Bankruptcy
laws, for the purpose of Landlord pursuing its rights and
remedies against Tenant and/or a guarantor of this Lease;
Tenant's failure to cause to be released any mechanics liens filed
against the Premises or the Project within twenty (20) days
after the date the same shall have been filed or recorded; or
Tenant's failure to observe or perform according to the provisions of
Articles 17 or 25 within five (5) business days after notice
from Landlord.
All defaults by Tenant of any covenant or condition of this Lease
shall be deemed by the parties hereto to be material.
REMEDIES
Upon the occurrence of an Event of Default under this Lease as provided
in Article 19 hereof, Landlord may exercise all of its
remedies as may be permitted by law, including but not limited
to the remedy provided by Section 1951.4 of the California
Civil Code, and including without limitation, terminating this
Lease, reentering the premises and removing all persons and
property therefrom, which property may be stored by Landlord
at a warehouse or elsewhere at the risk, expense and for the
account of Tenant. If Landlord elects to terminate this Lease,
Landlord shall be entitled to recover from Tenant the
aggregate of all amounts permitted by law, including but not
limited to (i) the worth at the time of the
26
Initials: ____
____
amount of any unpaid rent which had been earned at the time
of such termination; plus (ii) the worth at the time of
award of the amount by which the unpaid rent which would
have been earned after termination until the time of award
exceeds the amount of such rental loss that Tenant proves
could have been reasonably avoided; plus (iii) the worth at
the time of award of the amount by which the unpaid rent for
the balance of the Lease Term after the time of award
exceeds the amount of such rental loss that Tenant proves
could have been reasonably avoided; plus (iv) any other
amount necessary to compensate Landlord for all the
detriment proximately caused by Tenant's failure to perform
its obligations under this Lease or which in the ordinary
course of things would be likely to result therefrom,
specifically including but not limited to, brokerage
commissions and advertising expenses incurred, expenses of
remodeling the Premises or any portion thereof for a new
tenant, whether for the same or a different use, and any
special concessions made to obtain a new tenant; and (v) at
Landlord's election, such other amounts in addition to or in
lieu of the foregoing as may be permitted from time to time
by applicable law. The term "rent" as used in this Article
20(a) shall be deemed to be an d to mean all sums of every
nature required to be paid by Tenant pursuant to the terms
of this Lease, whether to Landlord or to others. As used in
items (i) and (ii), above, the "worth at the time of award"
shall be computed by allowing interest at the rate set forth
in item (e), below, but in no case greater than the maximum
amount of such interest permitted by law. As used in item
(iii), above, the "worth at the time of award" shall be
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%).
Nothing in this Article 20 shall be deemed to affect Landlord's right
to indemnification for liability or liabilities arising prior
to the termination of this Lease for personal injuries or
property damage under the indemnification clause or clauses
contained in this Lease.
Notwithstanding anything to the contrary set forth herein, Landlord's
re-entry to perform acts of maintenance or preservation of or
in connection with efforts to relet the Premises or any
portion thereof, or the appointment of a receiver upon
Landlord's initiative to protect Landlord's interest under
this Lease shall not terminate Tenant's right to possession of
the Premises or any portion thereof and, until Landlord does
elect to terminate this Lease, this Lease shall continue in
full force and effect and Landlord may enforce all of
Landlord's rights and remedies hereunder including, without
limitation, the remedy described in California Civil Code
Section 1951.4 (lessor may continue lease in effect after
lessee's breach and abandonment and recover rent as it becomes
due, if Lessee has the right to sublet or assign, subject only
to reasonable limitations). Accordingly, if Landlord does not
elect to terminate this Lease on account of any default by
Tenant, Landlord may, from time to time, without terminating
this Lease, enforce all of its rights and remedies under this
Lease, including the right to recover all rent as it becomes
due.
27
Initials: ____
____
All rights, powers and remedies of Landlord hereunder and under any
other agreement now or hereafter in force between Landlord and
Tenant shall be cumulative and not alternative and shall be in
addition to all rights, powers and remedies given to Landlord
by law, and the exercise of one or more rights or remedies
shall not impair Landlord's right to exercise any other right
or remedy.
Any amount due from Tenant to Landlord hereunder which is not paid when
due shall bear interest at the lower of eighteen percent (18%)
per annum or the maximum lawful rate of interest from the due
date until paid, unless otherwise specifically provided
herein, but the payment of such interest shall not excuse or
cure any default by Tenant under this lease. In addition to
such interest: (a) if Basic Rental is not paid within ten (10)
days after the same is due, a late charge equal to five
percent (5%) of the amount overdue or $100, whichever is
greater, shall be assessed and shall accrue for each calendar
month or part thereof until such rental, including the late
charge, is paid in full, which late charge Tenant hereby
agrees is a reasonable estimate of the damages Landlord shall
suffer as a result of Tenant's late payment and (b) an
additional charge of $25 shall be assessed for any check given
to Landlord by or on behalf of Tenant which is not honored by
the drawee thereof; which damages include Landlord's
additional administrative and other costs associated with such
late payment and unsatisfied checks and the parties agree that
it would be impracticable or extremely difficult to fix
Landlord's actual damage in such event. Such charges for
interest and late payments and unsatisfied checks are separate
and cumulative and are in addition to and shall not diminish
or represent a substitute for any or all of Landlord's rights
or remedies under any other provision of this Lease.
TRANSFER OF LANDLORD'S INTEREST
In the event of any transfer or termination of Landlord's interest in
the Premises or the Project by sale, assignment, transfer, foreclosure,
deed-in-lieu of foreclosure or otherwise whether voluntary or involuntary,
Landlord shall be automatically relieved of any and all obligations and
liabilities on the part of Landlord from and after the date of such transfer
or termination, including furthermore without limitation, the obligation of
Landlord under Article 4 and California Civil Code 1950.7 above to return the
security deposit, provided said security deposit is transferred to said
transferee. Tenant agrees to attorn to the transferee upon any such transfer
and to recognize such transferee as the lessor under this Lease and Tenant
shall, within fifteen (15) days after request, execute such further
instruments or assurances as such transferee may reasonably deem necessary to
evidence or confirm such attornment.
BROKER
In connection with this Lease, Tenant warrants and represents that it
has had dealings only with firm(s) set forth in Article 1.H. of the Basic
Lease Provisions and that it knows of no other person or entity who is or
might be entitled to a commission, finder's fee or other like payment in
connection herewith and does hereby indemnify and agree to hold Landlord, its
28
Initials: ____
____
agents, members, partners, representatives, officers, affiliates,
shareholders, employees, successors and assigns harmless from and against any
and all loss, liability and expenses that Landlord may incur should such
warranty and representation prove incorrect, inaccurate or false. Except as
provided herein, Landlord shall be solely responsible for payment of any
brokerage commissions owing to such firm(s) in connection herewith.
PARKING
Tenant shall be entitled to rent from Landlord up to the number of
Structure Passes and Surface Passes set forth in Section 1(I) of the Basic
Lease Provisions, which parking passes shall pertain to either the Project's
surface parking lot or the Project parking structure (as designated in Section
1(I)). Tenant's right to use the Surface Passes shall commence as of July 1,
1997 and Tenant's right to use the Structure Passes shall commence as of the
Lease Commencement Date. Until the end of the third (3rd) Lease Year, Tenant
shall pay to Landlord fifty-five Dollars ($55.00) per pass per month for each
Surface Pass and seventy-five Dollars ($75.00) per pass per month for each
Structure Pass. Thereafter, Tenant shall pay to Landlord for automobile
parking passes the prevailing rate charged from time to time at the location
of such parking passes. In addition, Tenant shall be responsible for the full
amount of any taxes imposed by any governmental authority in connection with
the renting of such parking passes by Tenant or the use of the parking
facility by Tenant. Tenant shall have the right to vary the number of Surface
Passes utilized by Tenant from time to time throughout the Lease Term upon at
least thirty (30) days' prior written notice to Landlord. However, if Tenant
notifies Landlord that Tenant elects not to utilize all of the Structure
Passes to which Tenant is entitled under Section 1(I) of the Basic Lease
Provisions at any time during the Lease Term, then any such Structure Passes
that Tenant elects not to so utilize shall no longer be available to Tenant
during the remainder of the Lease Term. Tenant's continued right to use the
parking passes is conditioned upon Tenant abiding by all rules and regulations
which are prescribed from time to time for the orderly operation and use of
the parking facility where the parking passes are located, including any
sticker or other identification system established by Landlord, Tenant's
cooperation in seeing that Tenant's employees and visitors also comply with
such rules and regulations, and Tenant not being in default under this Lease.
Landlord specifically reserves the right to change the size, configuration,
design, layout and all other aspects of the Project parking facility at any
time and Tenant acknowledges and agrees that Landlord may, without incurring
any liability to Tenant and without any abatement of rent under this Lease,
from time to time, close-off or restrict access to the Project parking
facility for purposes of permitting or facilitating any such construction,
alteration or improvements. Landlord may delegate its responsibilities
hereunder to a parking operator or a lessee of the parking facility in which
case such parking operator or lessee shall have all the rights of control
attributed hereby to the Landlord. The parking passes rented by Tenant
pursuant to this Article 23 are provided to Tenant solely for use by Tenant's
own personnel and such passes may not be transferred, assigned, subleased or
otherwise alienated by Tenant without Landlord's prior approval. Tenant may
validate visitor parking by such method or methods as the Landlord may
establish, at the validation rate from time to time generally applicable to
visitor parking.
29
Initials: ____
____
WAIVER
No waiver by Landlord of any provision of this Lease shall be deemed
to be a waiver of any other provision hereof or of any subsequent breach by
Tenant of the same or any other provision. No provision of this Lease may be
waived by Landlord, except by an instrument in writing executed by Landlord.
Landlord's consent to or approval of any act by Tenant requiring Landlord's
consent or approval shall not be deemed to render unnecessary the obtaining of
Landlord's consent to or approval of any subsequent act of Tenant, whether or
not similar to the act so consented to or approved. No act or thing done by
Landlord or Landlord's agents under the Term of this Lease shall be deemed an
acceptance of a surrender of the Premises, and no agreement to accept such
surrender shall be valid unless in writing and signed by Landlord. Any payment
by Tenant or receipt by Landlord of an amount less than the total amount then
due hereunder shall be deemed to be in partial payment only thereof and not a
waiver of the balance due or an accord and satisfaction, notwithstanding any
statement or endorsement to the contrary on any check or any other instrument
delivered concurrently therewith or in reference thereto. Accordingly,
Landlord may accept any such amount and negotiate any such check without
prejudice to Landlord's right to recover all balances due and owing and to
pursue its other rights against Tenant under this Lease, regardless of whether
Landlord makes any notation on such instrument of payment or otherwise
notifies Tenant that such acceptance or negotiation is without prejudice to
Landlord's rights.
ESTOPPEL CERTIFICATE
Tenant shall, at any time and from time to time, upon not less than
fifteen (15) days' prior written notice from Landlord, execute, acknowledge
and deliver to Landlord a statement in writing certifying the following
information, (but not limited to the following information in the event
further information is requested by Landlord): (i) that this Lease is
unmodified and in full force and effect (or, if modified, stating the nature
of such modification and certifying that this Lease, as modified, is in full
force and effect); (ii) the dates to which the rental and other charges are
paid in advance, if any; (iii) the amount of Tenant's security deposit, if
any; and (iv) acknowledging that there are not, to Tenant's knowledge, any
uncured defaults on the part of Landlord hereunder, and no events or
conditions then in existence which, with the passage of time or notice or
both, would constitute a default on the part of Landlord hereunder, or
specifying such defaults, events or conditions, if any are claimed. It is
expressly understood and agreed that any such statement may be relied upon by
any prospective purchaser or encumbrancer of all or any portion of the Real
Property. Tenant's failure to deliver such statement within such time shall
constitute a default under this Lease. Tenant agrees to execute all documents
required in accordance with this Article 25 within fifteen (15) days after
delivery of said documents.
LIABILITY OF LANDLORD
Notwithstanding anything in this Lease to the contrary, any remedy of
Tenant for the collection of a judgment (or other judicial process) requiring
the payment of money by Landlord
30
Initials: ____
____
in the event of any default by Landlord hereunder or any claim, cause of
action or obligation, contractual, statutory or otherwise by Tenant against
Landlord concerning, arising out of or relating to any matter relating to this
Lease and all of the covenants and conditions or any obligations, contractual,
statutory, or otherwise set forth herein, shall be limited solely and
exclusively to an amount which is equal to the lesser of (i) the interest of
Landlord in and to the Project, and (ii) the interest Landlord would have in
the Project if the Project were encumbered by third party debt in an amount
equal to ninety percent (90%) of the then current value of the Project (as
such value is reasonably determined by Landlord). No other property or assets
of Landlord, or any member, officer, director shareholder, partners, trustee,
agent, servant or employee of Landlord (the "Representative") shall be subject
to levy, execution or other enforcement procedure for the satisfaction of
Tenant's remedies under or with respect to this Lease, Landlord's obligations
to Tenant, whether contractual, statutory or otherwise, the relationship of
Landlord and Tenant hereunder, or Tenant's use or occupancy of the Premises.
Tenant further understands that any liability, duty or obligation of Landlord
to Tenant that arises after the date that Landlord or any of Landlord's
Representatives no longer have any right, title or interest in or to the
Project, shall automatically cease and terminate as of the date that Landlord
or any of the Landlord's Representatives no longer have any right, title or
interest in or to the Project, provided that any transferee of Landlord's
right, title and interest in or to the Project assumes Landlord's obligations
hereunder, by operation of law or otherwise, after the date of such transfer.
INABILITY TO PERFORM
This Lease and the obligations of Tenant hereunder shall not be
affected or impaired because Landlord is unable to fulfill any of its
obligations hereunder or is delayed in doing so, if such inability or delay is
caused by reason of any prevention, delay, stoppage due to strikes, lockouts,
acts of God, or any other cause previously, or at such time, beyond the
reasonable control or anticipation of Landlord (collectively, a "Force
Majeure") and Landlord's obligations under this Lease shall be forgiven and
suspended by any such Force Majeure.
HAZARDOUS WASTE
Tenant shall not cause or permit any Hazardous Material (as defined in
Article 28(d) below) to be brought, kept or used in or about
the Project by Tenant, its agents, employees, contractors, or
invitees, except for general office supplies typically used in
the ordinary course of business (e.g., copier toner, liquid
paper, glue, ink, and cleaning solvents) in commercially
reasonable amounts used in compliance with all applicable
Laws. Without limiting the foregoing, if the presence of any
Hazardous Material on the Project caused or permitted by
Tenant results in any contamination of the Project and subject
to the provisions of Articles 9, 10, and 11, hereof, Tenant
shall promptly take all actions at its sole expense as are
necessary to return the Project to the condition existing
prior to the introduction of any such Hazardous Material and
the contractors to be used by Tenant for such work must be
approved by Landlord, which approval shall not be unreasonably
31
Initials: ____
____
withheld so long as such actions would not potentially have
any material adverse long-term or short-term effect on the
Project and so long as such actions do not materially
interfere with the use and enjoyment of the Project by the
other tenants thereof.
It shall not be unreasonable for Landlord to withhold its consent to
any proposed Transfer if (i) the proposed transferee's
anticipated use of the Premises involves the generation,
storage, use, treatment, or disposal of Hazardous Material;
(ii) the proposed Transferee has been required by any prior
landlord, lender, or governmental authority to take remedial
action in connection with Hazardous Material contaminating a
property if the contamination resulted from such Transferee's
actions or use of the property in question; or (iii) the
proposed Transferee is subject to an enforcement order issued
by any governmental authority in connection with the use,
disposal, or storage of a Hazardous Material.
As used herein, the term "Hazardous Material" means any hazardous or
toxic substance, material, or waste which is or becomes
regulated by any local governmental authority, the State of
California or the United States Government. The term
"Hazardous Material" includes, without limitation, any
material or substance which is (i) defined as "Hazardous
Waste," "Extremely Hazardous Waste," or "Restricted Hazardous
Waste" under Sections 25115, 25117 or 25122.7, or listed
pursuant to Section 25140, of the California Health and Safety
Code, Division 20, Chapter 6.5 (Hazardous Waste Control Law),
(ii) defined as "Hazardous Substance" under Section 25316 of
the California Health and Safety Code, Division 20, Chapter
6.8 (Xxxxxxxxx-Xxxxxxx-Xxxxxx Hazardous Substance Account
Act), (iii) defined as a "Hazardous Material," "Hazardous
Substance," or "Hazardous Waste" under Section 25501 of the
California Health and Safety Code, Division 20, Chapter 6.95
(Hazardous Materials Release Response Plans and Inventory),
(iv) defined as "Hazardous Substance" under Section 25281 of
the California Health and Safety Code, Division 20, Chapter
6.7 (Underground Storage of Hazardous Substance), (v)
petroleum, (vi) asbestos, (vii) listed under Article 9 or
defined as Hazardous or extremely hazardous pursuant to
Article 11 of Title 22 of the California Administrative Code,
Division 4, Chapter 20, (viii) designated as a "Hazardous
Substance" pursuant to Section 311 of the Federal Water
Pollution Control Act (33 USC Section 1317), (ix) defined as a
"Hazardous Waste" pursuant to Section 1004 of the Federal
Resource Conservation and Recovery Act, 24 USA Section 6901 et
seq. (42 USC Section 6903), or (x) defined as a "Hazardous
Substance" pursuant to Section 101 of the Comprehensive
Environmental Response, Compensation and Liability Act, 42 USA
Section 9601 et seq. 942 USA Section 9601).
As used herein, the term "Laws" mean any applicable federal, state or
local laws, ordinances, or regulations relating to any
Hazardous Material affecting the Project, including, without
limitation, the laws, ordinances, and regulations referred to
in Article 28(c) above.
32
Initials: ____
____
Landlord represents to Tenant that to the actual knowledge of
Landlord's Director of Leasing as of the date of this Lease,
there are no Hazardous Materials located on the Project in
violation of any Laws in effect as of the date of this Lease.
SURRENDER OF PREMISES; REMOVAL OF PROPERTY
The voluntary or other surrender of this Lease by Tenant to Landlord,
or a mutual termination hereof, shall not work a merger, and
shall at the option of Landlord, operate as an assignment to
it of any or all subleases or subtenancies affecting the
Premises.
Upon the expiration of the Term of this Lease, or upon any earlier
termination of this Lease, Tenant shall quit and surrender
possession of the Premises to Landlord in as good order and
condition as the same are now and hereafter may be improved by
Landlord or Tenant, reasonable wear and tear, obsolescence,
damage from the elements, fire and other casualty and repairs
which are Landlord's obligation excepted, and shall, without
expense to Landlord, remove or cause to be removed from the
Premises all debris and rubbish, all furniture, equipment,
business and trade fixtures, free-standing cabinet work,
moveable partitioning and other articles of personal property
owned by Tenant or installed or placed by Tenant at its own
expense in the Premises, and all similar articles of any other
persons claiming under Tenant unless Landlord exercises its
option to have any subleases or subtenancies assigned to it,
and Tenant shall repair all damage to the Premises resulting
from the installation and removal of such items to be removed.
Whenever Landlord shall reenter the Premises as provided in Article 12
hereof, or as otherwise provided in this Lease, any property
of Tenant not removed by Tenant upon the expiration of the
Term of this Lease, unless Tenant is holding over pursuant to
Article 5 of this Lease (or within forty-eight (48) hours
after a termination by reasons of Tenant's default), as
provided in this Lease, shall be considered abandoned and
Landlord may remove any or all of such items and dispose of
the same in any manner or store the same in a public warehouse
or elsewhere for the account and at the expense and risk of
Tenant, and if Tenant shall fail to pay the cost of storing
any such property after it has been stored for a period of
ninety (90) days or more, Landlord may sell any or all of such
property at public or private sale, in such manner and at such
times and places as Landlord, in its sole discretion, may deem
proper, without notice or to demand upon Tenant, for the
payment of all or any part of such charges or the removal of
any such property, and shall apply the proceeds of such sale:
first, to the cost and expense of such sale, including
reasonable attorneys' fees for services rendered; second, to
the payment of the cost of or charges for storing any such
property; third, to the payment of any other sums of money
which may then or thereafter be due to Landlord from Tenant
under any of the terms hereof; and fourth, the balance, if
any, to Tenant.
33
Initials: ____
____
All fixtures, equipment, alterations, additions, improvements and/or
appurtenances attached to or built into the Premises prior to
or during the Term, whether by Landlord or Tenant and whether
at the expense of Landlord or Tenant, or of both, shall be and
remain part of the Premises and shall not be removed by Tenant
at the end of the Term unless otherwise expressly provided for
in this Lease or unless such removal is required by Landlord
pursuant to the provisions of Article 9, above. Such fixtures,
equipment, alterations, additions, improvements and/or
appurtenances shall include but not be limited to: all floor
coverings, drapes, paneling, built-in cabinetry, molding,
doors, vaults (including vault doors), plumbing systems,
electrical systems, lighting systems, silencing equipment,
communication systems, all fixtures and outlets for the
systems mentioned above and for all telephone, radio,
telegraph and television purposes, and any special flooring or
ceiling installations. Notwithstanding anything to the
contrary contained herein, Tenant may, at the end of the Term
of this Lease, remove communication systems and audio-visual
systems purchased and paid for by Tenant with funds that were
not a part of the Tenant Improvement Allowance, provided that
such systems are not permanently affixed to the Premises and
further provided that Tenant shall, at Tenant's sole cost and
expense, repair any and all damage resulting from Tenant's
removal of such items.
MISCELLANEOUS
SEVERABILITY; ENTIRE AGREEMENT. Any provision of this Lease which shall
prove to be invalid, void or illegal shall in no way affect,
impair or invalidate any other provision hereof and such other
provisions shall remain in full force and effect. This Lease
and the Exhibits and any Addendum attached hereto constitute
the entire agreement between the parties hereto with respect
to the subject matter hereof, and no prior agreement or
understanding pertaining to any such matter shall be effective
for any purpose. No provision of this Lease may be amended or
supplemented except by an agreement in writing signed by the
parties hereto or their successor in interest. This Lease
shall be governed by and construed in accordance with the laws
of the State of California.
ATTORNEYS' FEES; WAIVER OF JURY TRIAL.
In any action to enforce the terms of this Lease, including
any suit by Landlord for the recovery of rent or
possession of the Premises, the losing party shall
pay the successful party a reasonable sum for
attorneys' fees in such suit and such attorneys' fees
shall be deemed to have accrued prior to the
commencement of such action and shall be paid whether
or not such action is prosecuted to judgment.
EACH PARTY HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY
ACTION SEEKING SPECIFIC PERFORMANCE OF ANY PROVISIONS
OF THIS LEASE, FOR DAMAGES FOR ANY
34
Initials: ____
____
BREACH UNDER THIS LEASE, OR OTHERWISE FOR
ENFORCEMENT OF ANY RIGHT OR REMEDY HEREUNDER.
TIME OF ESSENCE. Time is of the essence with respect to the
performance of every provision of this Lease.
HEADINGS. The article headings contained in this Lease are for
convenience only and do not in any way limit or amplify any
term or provision hereof. The terms "Landlord" and "Tenant" as
used herein shall include the plural as well as the singular,
the neuter shall include the masculine and feminine genders
and the obligations herein imposed upon Tenant shall be joint
and several as to each of the persons, firms or corporations
of which Tenant may be composed.
RESERVED AREA. Tenant hereby acknowledges and agrees that the exterior
walls of the Premises and the area between the finished
ceiling of the Premises and the slab of the floor of the
project thereabove have not been demised hereby and the use
thereof together with the right to install, maintain, use,
repair and replace pipes, ducts, conduits and wires leading
through, under or above the Premises in locations which will
not materially interfere with Tenant's use of the Premises and
serving other parts of the Project are hereby excepted and
reserved unto Landlord.
NO OPTION. The submission of this Lease by Landlord, its agent or
representative for examination or execution by Tenant does not
constitute an option or offer to lease the Premises upon the
terms and conditions contained herein or a reservation of the
Premises in favor of Tenant, it being intended hereby that
this Lease shall only become effective upon the execution
hereof by Landlord and delivery of a fully executed Lease to
Tenant.
USE OF PROJECT NAME; IMPROVEMENTS. Tenant shall not be allowed to use
the name, picture or representation of the Project, or words
to that effect, in connection with any business carried on in
the Premises or otherwise (except as Tenant's address) without
the prior written consent of Landlord. In the event that
Landlord undertakes any additional improvements on the Real
Property including but not limited to new construction or
renovation or additions to the existing improvements, Landlord
shall use commercially reasonable efforts to minimize
interference with Tenant's operations in the Premises, but in
no event shall Landlord be liable to Tenant for any noise,
dust, vibration or interference with access to the Premises or
disruption in Tenant's business caused thereby.
RULES AND REGULATIONS. Tenant shall observe faithfully and comply
strictly with the Rules and Regulations attached to this Lease
and made a part hereof, and such other Rules and Regulations
as Landlord may from time to time reasonably adopted for the
safety, care and cleanliness of the Project, the facilities
thereof, or the preservation of good order therein. Landlord
shall not be liable to Tenant for violation of any such Rules
and Regulations, or for the breach of any covenant or
condition in any lease by any other tenant in the Project. A
waiver by Landlord of
35
Initials: ____
____
any Rule or Regulation for any other tenant shall not
constitute nor be deemed a waiver of the Rule or Regulation
for this Tenant.
QUIET POSSESSION. Upon Tenant's paying the Basic Rent, Additional Rent
and other sums provided hereunder and observing and performing
all of the covenants, conditions and provisions on Tenant's
part to be observed and performed hereunder, Tenant shall have
quiet possession of the Premises for the entire Term hereof,
subject to all of the provisions of this Lease.
RENT. All payments required to be made hereunder to Landlord shall be
deemed to be rent, whether or not described as such.
SUCCESSORS AND ASSIGNS. Subject to the provisions of Article 15 hereof,
all of the covenants, conditions and provisions of this Lease
shall be binding upon and shall inure to the benefit of the
parties hereto and their respective heirs, personal
representatives, successors and assigns.
NOTICES. Any notice required or permitted to be given hereunder shall
be in writing and may be given by recognized overnight service
or sent by registered or certified mail, return receipt
requested, addressed to Tenant at 000 Xxxx Xxxxxx, Xxx Xxxx,
XX 00000, Attn: director of Leasing, or to Landlord at the
address of the place from time to time established for the
payment of rent and which shall be effective upon proof of
delivery. Either party may by notice to the other specify a
different address for notice purposes. A copy of all notices
to be given to Landlord hereunder shall be concurrently
transmitted by Tenant to such party hereafter designated by
notice from Landlord to Tenant.
PERSISTENT DELINQUENCIES. In the event that Tenant shall be delinquent
by more than fifteen (15) days in the payment of rent on three
(3) separate occasions in any twelve (12) month period,
Landlord shall have the right to terminate this Lease by
thirty (30) days written notice given by Landlord to Tenant
within thirty (30) days of the last such delinquency.
RIGHT OF LANDLORD TO PERFORM. All covenants and agreements to be
performed by Tenant under any of the terms of this Lease shall
be performed by Tenant at Tenant's sole cost and expense and
without any abatement of rent. If Tenant shall fail to pay any
sum of money, other than 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
beyond any applicable cure period set forth in this Lease,
Landlord may, but shall not be obligated to, without waiving
or releasing Tenant from any obligations of Tenant, make any
such payment or perform any such other act on Tenant's part to
be made or performed as is in this Lease provided. All sums so
paid by Landlord and all reasonable incidental costs, together
with interest thereon at the rate of ten percent (10%) per
annum from the date of such payment by Landlord, shall be
payable to Landlord fifteen (15) days after written demand and
Tenant covenants to pay any such sums, and Landlord shall have
(in addition to any other right or remedy of Landlord) the
same rights and remedies in the
36
Initials: ____
____
event of the nonpayment thereof by Tenant as in the case of
default by Tenant in the payment of the rent.
ACCESS, CHANGES IN PROJECT, FACILITIES, NAME.
Every part of the Project except the inside surfaces of all
walls, windows and doors bounding the Premises
(including exterior building walls, core corridors
walls and doors and any core corridor entrance), and
any space in or adjacent to the premises used for
shafts, stacks, pies, conduits, fan rooms, ducts,
electric or other utilities, sinks or other building
facilities, and the use thereof, as well as access
thereto through the Premises for the purposes of
operation, maintenance, decoration and repair, are
reserved to Landlord.
Tenant shall permit Landlord to install, use and maintain
pipes, ducts and conduits within the walls, columns
and ceilings of the Premises. In exercising its
rights under this Section (o)(ii), Landlord shall use
commercially reasonable efforts to minimize
interference with Tenant's operations in the
Premises.
Landlord reserves the right, without incurring any liability
to Tenant therefor, to make such changes in or to the
Project and the fixtures and equipment thereof, as
well as in or to the street entrances, halls,
passages, elevators, stairways and other improvements
thereof, as it may deem necessary or desirable. In
exercising its rights under this Section (o)(iii),
Landlord shall use commercially reasonable efforts to
minimize interference with Tenant's operations in the
Premises.
Landlord may adopt any name for the Project and Landlord
reserves the right to change the name or address of
the Project at any time.
CORPORATE AUTHORITY. If Tenant is a corporation, each individual
executing this Lease on behalf of said corporation represents
and warrants that he or she 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
corporations, and that this Lease is binding upon said
corporation in accordance with its terms. If Tenant is a
corporation, said corporation and each individual executing
this Lease on behalf of said corporation covenants that Tenant
shall provide to Landlord a copy of such resolution of the
Board of directors authorizing the execution of this lease on
behalf of such corporation.
IDENTIFICATION OF TENANT.
If Tenant constitutes more than one person or entity, (A) each
of them shall be jointly and severally liable for the
keeping, observing and performing of all of the
terms, covenants, conditions and provisions of this
Lease to be
37
Initials: ____
____
kept, observed and performed by Tenant, (B) the
term "Tenant" as used in this Lease shall mean and
include each of them jointly and severally, and (C)
the act of 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 binding upon each and all of the
persons or entities executing this Lease as Tenant
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.
If Tenant is a partnership (or is comprised of two or more
persons, individually and as copartners of a
partnership) or if Tenant's interest in this Lease
shall be assigned to a partnership (or to two or more
persons, individually and as copartners of a
partnership) pursuant to Article 15 hereof (any such
partnership and such persons hereinafter referred to
in this Article 30(q)(ii) as "Partnership Tenant"),
the following provisions of this Lease shall apply to
such Partnership Tenant:
The liability of each of the parties comprising
Partnership Tenant shall be joint and
several.
Each of the parties comprising Partnership Tenant
hereby consents in advance to, and agrees to
be bound by, any written instrument which
may hereafter be executed, changing,
modifying or discharging this Lease, in
whole or in part, or surrendering all or any
part of the Premises to the Landlord, and by
notices, demands, requests or other
communication which may hereafter be given,
by Partnership Tenant or any of the parties
comprising Partnership Tenant.
Any bills, statements, notices, demands, requests or
other communications given or rendered to
Partnership Tenant or to any of the parties
comprising Partnership Tenant shall be
deemed given or rendered to Partnership
Tenant and to all such parties and shall be
binding upon Partnership Tenant and all such
parties.
If Partnership Tenant admits new partners, all of
such new partners shall, by their admission
to Partnership Tenant, be deemed to have
assumed performance of all of the terms,
covenants and conditions of this Lease on
Tenant's part to be observed and performed.
Partnership Tenant shall given prompt notice to
Landlord of the admission of any such new
partners, and, upon demand of Landlord,
shall cause each such new partner to execute
and deliver to Landlord an agreement in form
satisfactory to Landlord, wherein each such
new partner shall assume performance of all
of the terms, covenants and conditions of
this Lease on Partnership Tenant's part to
be
38
Initials: ____
____
observed and performed (but neither
Landlord's failure to request any such
agreement nor the failure of any such new
partner to execute or deliver any such
agreement to Landlord shall terminate the
provisions of clause (D) of this Article
30(q)(ii) or relieve any such new partner of
its obligations thereunder).
SUBSTITUTE PREMISES. Landlord shall have the right at any time during
the Term hereof, upon giving Tenant not less than sixty (60)
days prior notice, to provide and furnish Tenant with space
elsewhere in the Project of approximately the same size as the
Premises and remove and place Tenant in such space. However,
such right of Landlord shall only apply to portions of the
Premises that contain less than five thousand (5,000) rentable
square feet on any multi-tenant floor and such relocation
shall be to space located on the third (3rd) floor of the
Project or higher. Landlord shall pay all verified and
previously approved costs and expenses incurred as a result of
such movement to such new space. If Landlord moves Tenant to
such new space, this Lease and each and all of its terms,
covenants and conditions shall remain full force and effect
and shall be deemed applicable to such new space and such new
space shall thereafter be deemed to be the "Premises" as
though Landlord and Tenant had entered into an express written
amendment of this Lease with respect thereto.
EXHIBITS AND ADDENDUM. The Exhibits and Addendum, if applicable,
attached hereto are incorporated herein by this reference as
if fully set forth herein.
OPTION TO EXTEND
OPTION RIGHT. Landlord hereby grants the Tenant named in this Lease
(the "Original Tenant") one (1) option ("Option") to extend
the Lease Term for the entire Premises for a period of five
(5) years (an "Option Term"), which Option shall be
exercisable only by written notice delivered by Tenant to
Landlord set forth below. The rights contained in this Article
31 shall be personal to the Original Tenant and may only be
exercised by the Original Tenant (and not any assignee,
sublessee or other transferee of the Original Tenant's
interest in this Lease) if the Original Tenant occupies the
entire Premises as of the date of Tenant's Acceptance (as
defined in Section 31(c) below).
OPTION RENT. The rent payable by Tenant during the Option Term
("Option Rent") shall be equal to ninety-five percent (95%) of
the "Market Rent" (defined below). "Market Rent" shall mean
the applicable Monthly Basic Rental, including all
escalations, Direct Costs, additional rent and other charges
at which tenants, as of the commencement of the Option Term,
are leasing non-sublease, non-encumbered, non-equity, space
comparable in size, location and quality to the Premises in
renewal transactions for a term comparable to the Option Term
which comparable space is located in office buildings
comparable to the Project in the El Segundo/Los Angeles
Airport area of California.
39
Initials: ____
____
EXERCISE OF OPTIONS. The Option shall be exercised by Tenant only in
the following manner: (i) Tenant shall not be in default, and
shall not have been in default, and shall not have been in
default under this Lease more than once, on the delivery date
of the Interest Notice and Tenant's Acceptance; (ii) Tenant
shall deliver written notice ("Interest Notice") to Landlord
not less than nine (9) months prior to the expiration of the
Lease Term, stating that Tenant is interested in exercising
the Option, (iii) within fifteen (15) business days of
Landlord's receipt of Tenant's written notice, Landlord shall
deliver notice ("Option Rent Notice") to Tenant setting forth
the Option Rent; and (iv) if Tenant desires to exercise such
Option, Tenant shall provide Landlord written notice within
fifteen (15) business days after receipt of the Option Rent
Notice ("Tenant's Acceptance") and upon, and concurrent with
such exercise, Tenant may, at its option, object to the Option
Rent contained in the Option Rent Notice, in which case the
parties shall follow the procedure, and the Option Rent shall
be determined, as set forth in Section 31(d) below. Tenant's
failure to deliver the Interest Notice or Tenant's Acceptance
on or before the dates specified above shall be deemed to
constitute Tenant's election not to exercise the Option.
DETERMINATION OF MARKET RENT. If Tenant timely and appropriately
objects to the Market Rent in Tenant's Acceptance, Landlord
and Tenant shall attempt to agree upon the Market Rent using
their best good-faith efforts. If Landlord and Tenant fail to
reach agreement within twenty-one (21) days following Tenant's
Acceptance ("Outside Agreement Date"), then each party shall
make a separate determination of the Market Rent which shall
be submitted to each other and to arbitration in accordance
with the following items (i) through (vii):
Landlord and Tenant shall each appoint, within ten (10) days
of the Outside Agreement Date, one arbitrator who
shall by profession be a current real estate broker
or appraiser of commercial high-rise properties in
the immediate vicinity of the Project, and who has
been active in such field over the last five (5)
years. The determination of the arbitrators shall be
limited solely to the issue of whether Landlord's or
Tenant's submitted Market Rent is the closest to the
actual Market Rent as determined by the arbitrators,
taking into account the requirements of item (b),
above.
The two arbitrators so appointed shall within five (5)
business days of the date of the appointment of the
last appointed arbitrator agree upon and appoint a
third arbitrator who shall be qualified under the
same criteria set forth hereinabove for qualification
of the initial two arbitrators.
The three arbitrators shall within fifteen (15) days of the
appointment of the third arbitrator reach a decision
as to whether the parties shall use Landlord's or
Tenant's submitted Market Rent, and shall notify
Landlord and Tenant thereof.
The decision of the majority of the three arbitrators shall be
binding upon Landlord and Tenant.
40
Initials: ____
____
If either Landlord or Tenant fails to appoint an arbitrator
within ten (10) days after the applicable Outside
Agreement Date, the arbitrator appointed by one of
them shall reach a decision, notify Landlord and
Tenant thereof, and such arbitrator's decision shall
be binding upon Landlord and Tenant.
If the two arbitrators fail to agree upon and appoint a third
arbitrator, or both parties fail to appoint an
arbitrator, then the appointment of the third
arbitrator or any arbitrator shall be dismissed and
the matter to be decided shall be forthwith submitted
to arbitration under the provisions of the American
Arbitration Association, but subject to the
instruction set forth in this item (d).
The cost of arbitration shall be paid by Landlord and Tenant
equally.
RIGHT OF FIRST OFFER
Landlord hereby grants to Tenant a right of first offer with respect to
any space on the sixth (6th) floor of the Project ("First Offer Space").
Notwithstanding the foregoing (i) such first offer right of Tenant shall
commence only following the expiration or earlier termination of any existing
lease pertaining to the First Offer Space, and, as to any First Offer Space
which is vacant as of the date of this Lease, the first lease pertaining to any
portion of such First Offer Space entered into by Landlord after the date of
this Lease (collectively, the "Superior Leases"), including any renewal or
extension of such existing or future lease, whether or not such renewal or
extension is pursuant to an express written provision in such lease, and
regardless of whether any such renewal or extension is consummated pursuant to a
lease amendment or a new lease, and (ii) such first offer right shall be
subordinate and secondary to all rights of expansion, first refusal, first offer
or similar rights granted to the tenants of the Superior Leases (the rights
described in items (i) and (ii), above to be known collectively as "Superior
Rights"). Tenant's right of first offer shall be on the terms and conditions set
forth in this Section 32.
PROCEDURE FOR OFFER. Landlord shall notify Tenant (the "First Offer
Notice") from time to time when Landlord determines that
Landlord shall commence the marketing of any First Offer Space
because such space shall become available for lease to third
parties, where no holder of a Superior Right desires to lease
such space. the First Offer Notice shall describe the space
so offered to Tenant and shall set forth Landlord's proposed
economic terms and conditions applicable to Tenant's lease of
such space (collectively, the "Economic Terms").
Notwithstanding the foregoing, Landlord's obligation to
deliver the First Offer Notice shall not apply during the last
nine (9) months of the initial Lease Term unless Tenant has
delivered an Interest Notice to Landlord pursuant to Section
31(c) above nor shall Landlord be obligated to deliver the
First Offer Notice during the last eight (8) months of the
initial Lease Term unless Tenant has delivered Tenant's
Acceptance to Landlord pursuant to Section 31(c) above.
PROCEDURE FOR ACCEPTANCE. If Tenant wishes to exercise Tenant's right
of first offer with respect to the space described in the
First Offer Notice, then within fifteen (15)
41
Initials: ____
____
business days after delivery of the First Offer Notice to
Tenant, Tenant shall deliver notice to Landlord of Tenant's
intention to exercise its right of first offer with respect
to the entire space described in the First Offer Notice. If
concurrently with Tenant's exercise of the first offer
right, Tenant notifies Landlord that it does not accept the
Economic Terms set forth in the First Offer Notice,
Landlord and Tenant shall, for a period of fifteen (15)
business days after Tenant's exercise, negotiate in good
faith to reach agreement as to such Economic Terms. If
Tenant does not so notify Landlord that it does not accept
the Economic Terms set forth in the First Offer Notice
concurrently with Tenant's exercise of the first offer
right, the Economic Terms shall be as set forth in the
First Offer Notice. In addition, if Tenant does not
exercise its right of first offer within the fifteen (15)
business day period, or, if Tenant exercises its first
offer right but timely objects to Landlord's determination
of the Economic Terms within said fifteen (15) business day
period, then Landlord shall be free to lease the space
described in the First Offer Notice to anyone to whom
Landlord desires on any terms Landlord desires and Tenant's
right of first offer shall terminate as to the First Offer
Space described in the First Office Notice. Notwithstanding
anything to the contrary contained herein, Tenant must
elect to exercise its right of first offer, if at all, with
respect to all of the space offered by Landlord to Tenant
at any particular time, and Tenant may not elect to lease
only a portion thereof.
CONSTRUCTION OF FIRST OFFER SPACE. Tenant shall take the First Offer
Space in its "as-is" condition, and Tenant shall be entitled
to construct improvements in the First Offer Space in
accordance with the provisions of Article 9 of this Lease.
LEASE OF FIRST OFFER SPACE. If Tenant timely exercises Tenant's right
to lease the First Offer Space as set forth herein, Landlord
and Tenant shall execute an amendment adding such First Offer
Space to this Lease upon the same non-economic terms and
conditions as applicable to the initial Premises, and the
economic terms and conditions as provided in this Section 32.
Tenant shall commence payment of rent for the First Offer
Space and the Lease Term of the First Offer space shall
commence upon the date of delivery of such space to Tenant.
The Lease Term for the First Offer Space shall expire
co-terminously with Tenant's lease of the initial Premises.
NO DEFAULTS. The rights contained in this Section 32(b) shall be
personal to the Original Tenant, and may only be exercised by
the Original Tenant (and not any assignee, sublessee or other
transferee of the Original Tenant's interest in this Lease) if
Tenant occupies the entire Premises as of the date of the
First Offer Notice. Tenant shall not have the right to lease
First Office Space as provided in this Section 32(b) if, as of
the date of the First Offer Notice, or, at Landlord's option,
as of the scheduled date of delivery of such First Offer Space
to Tenant, Tenant is in default under this Lease or Tenant has
previously been in default under this Lease more than once.
42
Initials: ____
____
DIRECTORY
Provided Tenant is not in default hereunder, Tenant, at Tenant's sole
cost and expense, shall have the right to one (1) line in the lobby directory
during the Lease Term.
TERMINATION OPTION
Provided Tenant fully and completely satisfies each of the conditions
set forth in this Article 34, Tenant shall have the option ("Termination
Option") to terminate this Lease effective at the end of the sixtieth (60th)
month of the initial Term only (the "Termination Date"). In order to exercise
the Termination Option, Tenant must fully and completely satisfy each and every
one of the following conditions: (a) Tenant must give Landlord written notice
("Termination Notice") of its intention to terminate this Lease, which
Termination Notice must be delivered to Landlord at least six (6) months prior
to the Termination Date, (b) at the time of the Termination Notice, Tenant shall
not be in default under this Lease after expiration of applicable cure periods,
and (c) within fourteen (14) days of Tenant's delivery of the Termination Notice
to Landlord, Tenant shall pay to Landlord a termination fee ("Termination Fee")
equal to the unamortized principal balance, as of the Termination Date, of the
(i) Tenant Improvement Allowance (and Additional Allowance, if any) actually
utilized by Tenant, and (ii) the brokerage commissions paid by Landlord in
connection with this Lease. Amortization pursuant to this Article 34 shall be
calculated on a ten (10) year amortization schedule commencing as of the
Commencement Date based upon equal monthly payments of principal and interest,
with interest imputed on the outstanding principal balance at the rate of ten
percent (10%) per annum. However, if Tenant exercises its right of first offer
pursuant to Article 32, above, the Termination Fee shall be increased by the
unamortized principal balance of any out-of-pocket sums expended by Landlord in
connection with any such expansion (including, without limitation, any sums
expended by Landlord to improve the First Offer space and any brokerage
commissions incurred by Landlord in connection with such expansion) with such
amortization to be calculated over any amortization period from the date upon
which Tenant's lease of the First Offer Space commences until the date of
expiration of the initial Term, based upon equal monthly payments of principal
and interest throughout such amortization period, with interest imputed on the
outstanding principal balance at the rate of ten percent (10%) per annum.
IN WITNESS WHEREOF, the parties have executed this Lease, consisting of
the foregoing provisions and Articles, including all exhibits and other
attachments referenced therein, as of the date first above written.
"LANDLORD" ARDEN REALTY LIMITED PARTNERSHIP, a
Maryland limited partnership
By: ARDEN REALTY, INC., a Maryland
corporation, Its sole general
partner
43
Initials: ____
____
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------
Xxxxxx X. Xxxxxxx
Its: President and CEO
By:
----------------------------
Its:
---------------------
"TENANT" METROPOLITAN LIFE INSURANCE
COMPANY, a New York corporation
By: /s/ Avi Xxxxxxxx
--------------------------------
Print Name: Avi Xxxxxxxx
Its: Vice President
By:
--------------------------------
Print Name:
------------------------
Its:
------------------------------
44
Initials: ____
____
EXHIBIT "A"
PREMISES
Initials: ____
____
EXHIBIT "B'
RULES AND REGULATIONS
1. No sign, advertisement or notice shall be displayed, printed or
affixed on or to the Premises or to the outside or inside of the Project or
so as to be visible from outside the Premises or Project without Landlord's
prior written consent. Landlord shall have the right to remove any
non-approved sign, advertisement or notice, without notice to and at the
expense of Tenant, and Landlord shall not be liable in damages for such
removal. All approved signs or lettering on doors and walls shall be
printed, painted, affixed or inscribed at the expense of Tenant by Landlord
or by a person selected by Landlord and in a manner and style acceptable to
Landlord.
2. Tenant shall no obtain for use on the Premises ice, drinking
water, waxing, cleaning, interior glass polishing, rubbish removal, towel
or other similar services, or accept barbering or bootblackening, or coffee
cart services, milk, soft drinks or other like services on the Premises,
except from person authorized by Landlord and at the hours and under
regulations fixed by Landlord. No vending machines or machines of any
description shall be installed, maintained or operated upon the Premises
without Landlord's prior written consent.
3. The sidewalks, halls, passages, exits, entrances, elevators and
stairways shall not be obstructed by Tenant or used for any purpose other
than for ingress and egress from Tenant's Premises.
4. Toilet rooms, toilets, urinals, wash bowls and other apparatus
shall not be used for any purpose other than for which they were
constructed and no foreign substance of any kind whatsoever shall be thrown
therein.
5. Tenant shall no overload the floor of the Premises or xxxx,
drive nails, screw or drill into the partitions ceilings or floor or in any
way deface the Premises.
6. In no event shall Tenant place a load upon any floor of the
Premises or portion of any such flooring exceeding the floor load per
square foot of area for which such floor is designed to carry and which is
allowed by law, or any machinery or equipment which shall cause excessive
vibration to the Premises or noticeable vibration to any other part of the
Project. Prior to bringing any heavy safes, vaults, large computers or
similarly heavy equipment into the Project, Tenant shall inform Landlord in
writing of the dimensions and weights thereof and shall obtain Landlord's
consent thereto. Such consent shall not constitute a representation or
warranty by Landlord that the safe, vault or other equipment complies, with
regard to distribution of weight and/or vibration, with the provisions of
this Rule 6 nor relieve Tenant from responsibility for the consequences of
such noncompliance, and any such safe, vault or other equipment which
Landlord determines to constitute a danger of damage to the Project or a
nuisance to other tenants, either alone or in combination with
1
Initials: ____
____
other heavy and/or vibrating objects and equipment, shall be promptly
removed by Tenant upon Landlord's written notice of such determination
and demand for removal thereof.
7. Tenant shall not use or keep in the Premises or Project any
kerosene, gasoline or inflammable, explosive or combustible fluid or
material, or use any method of heating or air-conditioning other than that
supplied by Landlord.
8. Tenant shall not lay linoleum, tile, carpet or other similar
floor covering so that the same shall be affixed to the floor of the
Premises in any manner except as approved by Landlord.
9. Tenant shall not install or use any blinds, shades, awnings or
screens in connection with any window or door of the Premises and shall not
use any drape or window covering facing any exterior glass surface other
than the standard drapes, blinds or other window covering established by
Landlord.
10. Tenant shall cooperate with Landlord in obtaining maximum
effectiveness of the cooling system by closing drapes when the sun's rays
fall directly on windows of the Premises. Tenant shall no obstruct, alter,
or in any way impair the efficient operation of Landlord's heating,
ventilating and air-conditioning system. Tenant shall not tamper with or
change the setting of any thermostats or control valves.
11. The Premises shall not be used for manufacturing or for the
storage of merchandise except as such storage may be incidental to the
permitted use of the Premises. Tenant shall not, without Landlord's prior
written consent, occupy or permit any portion of the Premises to be
occupied or used for the manufacture or sale of liquor or tobacco in any
form, or a xxxxxx or manicure shop, or as an employment bureau. The
Premises shall not be used for lodging or sleeping or for any improper,
objectionable or immoral purpose. No auction shall be conducted on the
Premises.
12. Tenant shall not make, or permit to be made, any unseemly or
disturbing noises, or disturb or interfere with occupants of Project or
neighboring buildings or premises or those having business with it by the
use of any musical instrument, radio, phonographs or unusual noise, or in
any other way.
13. No bicycles, vehicles or animals of any kind shall be brought
into or kept in or about the Premises, and no cooking shall be done or
permitted by any tenant in the Premises, except that the preparation of
coffee, tea, hot chocolate and similar items for tenants, their employees
and visitors shall be permitted. No tenant shall cause or permit any
unusual or objectionable odors to be produced in or permeate from or
throughout the Premises.
14. The sashes, sash doors, skylights, windows and doors that
reflect or admit light and air into the halls, passageways or other public
places in the Project shall not be covered or obstructed by any tenant, nor
shall any bottles, parcels or other articles be placed on the window xxxxx.
2
Initials: ____
____
15. No additional locks or bolts of any kind shall be placed upon
any of the doors or windows by any tenant, nor shall any changes be made in
existing locks or the mechanisms thereof unless Landlord is first notified
thereof, gives written approval, and is furnished a key therefor. Each
tenant must, upon the termination of his tenancy, give to Landlord all keys
of stores, offices, or toilets or toilet rooms, either furnished to, or
otherwise procured by, such tenant, and in the event of the loss of any
keys so furnished, such tenant shall pay Landlord the cost of replacing the
same or of changing the lock or locks opened by such lost key if Landlord
shall deem it necessary to make such change.
16. Landlord shall have the right to prohibit any advertising by
any tenant which, in Landlord's opinion, tends to impair the reputation of
the Project or its desirability as an office building and upon written
notice from Landlord any tenant shall refrain from and discontinue such
advertising.
17. Landlord reserves the right to control access to the Project
by all persons after reasonable hours of generally recognized business days
and at all hours on Sundays and legal holidays. Each tenant shall be
responsible for all persons for whom it requests after hours access and
shall be liable to Landlord for all acts of such persons. Landlord shall
have the right from time to time to establish reasonable rules pertaining
to freight elevator usage, including the allocation and reservation of such
usage for tenants' initial move-in to their premises, and final departure
therefrom.
18. Any person employed by any tenant to do janitorial work shall,
while in the Project and outside of the Premises, be subject to and under
the control and direction of the Office of the Project (but not as an agent
or servant of Landlord, and the tenant shall be responsible for all acts of
such persons).
19. All doors opening on to public corridors shall be kept closed,
except when being used for ingress and egress.
20. The requirements of tenants will be attended to only upon
application to the Office of the Project.
21. Canvassing, soliciting and peddling in the Project are
prohibited and each tenant shall cooperate to prevent the same.
22. All office equipment of any electrical or mechanical nature
shall be placed by tenants in the Premises in settings approved by
Landlord, to absorb or prevent any vibration, noise or annoyance.
23. No air-conditioning unit or other similar apparatus shall be
installed or used by any tenant without the prior written consent of
Landlord. Tenant shall pay the cost of all electricity use for
air-conditioning in the Premises if such electrical consumption exceeds
normal office requirements, regardless of whether additional apparatus is
installed pursuant to the preceding sentence.
EXHIBIT "B"
3
Initials: ____
____
24. There shall not be used in any space, or in the public halls
of the Project, either by any tenant or others, any hand trucks except
those equipped with rubber tires and side guards.
25. All electrical ceiling fixtures hung in offices or spaces
along the perimeter of the Project must be fluorescent and/or of a quality,
type, design and bulb color approved by Landlord. Tenant shall no permit
the consumption in the Premises of more than 2 1/2 xxxxx per net usable
square foot in the Premises in respect of office lighting nor shall Tenant
permit the consumption in the Premises of more than 1-1/2 xxxxx per net
usable square foot of space in the Premises in respect of the power outlets
therein, at any one time. In the event that such limits are exceeded,
Landlord shall have the right to require Tenant to remove lighting fixtures
and equipment and/or to charge Tenant for the cost of the additional
electricity consumed.
26. PARKING.
(a) Garage hours shall be 7:00 a.m. to 7:00 p.m., Monday
through Friday, and closed on weekends, state and federal holidays excepted, as
such hours may be revised from time to time by Landlord.
(b) Automobiles must be parked entirely within the stall lines
on the floor.
(c) All directional signs and arrows must be observed.
(d) The speed limit shall be 5 miles per hour.
(e) Parking is prohibited in areas not striped for parking.
(f) Parking cards or any other device or form of
identification supplied by Landlord (or its operator) shall remain the property
of Landlord (or its operator). Such parking identification device must be
displayed as requested and may not be mutilated in any manner. The serial number
of the parking identification device may not be obliterated. Devices are not
transferable or assignable and any device in the possession of an unauthorized
holder will be void. There will be a replacement charge to the Tenant or person
designated by Tenant of $25.00 for loss of any parking card.
(g) The monthly rate for parking is payable one (1) month in
advance and must be paid by the third business day of each month. Failure to do
so will automatically cancel parking privileges and a charge at the prevailing
daily rate will be due. No deductions or allowances from the monthly rate will
be made for days xxxxxx does not use Parking Facilities.
(h) Tenant may validate visitor parking by such method or
methods as the Landlord may approve, at the validation rate from time to time
generally applicable to visitor parking.
(i) Landlord (and its operator) may refuse to permit any
person who violates the within rules to park in the garage, and any violation of
the rules shall subject the automobile to removal from the garage at the
xxxxxx'x expense. In either of said events, Landlord (or its operator) shall
refund a prorate portion of the current monthly parking rate and the sticker or
any other form of identification supplied by Landlord (or its operator) will be
returned to Landlord (or its operator).
(j) Garage managers or attendants are not authorized to make
or allow any exceptions to these Rules and Regulations.
EXHIBIT "B"
4
Initials: ____
____
(k) Every xxxxxx is required to park and lock their own
automobile. All responsibility for any loss or damage to automobiles or any
personal property therein is assumed by the xxxxxx.
(l) Loss or theft of parking identification devices form
automobiles must be reported to the garage manager immediately, and a lost or
stolen report must be filed by the xxxxxx at that time.
(m) The Parking facilities are for the sole purpose of parking
one automobile per space. Washing, waxing, cleaning or servicing of any vehicles
by the xxxxxx or his agents I prohibited.
(n) Landlord (and its operator) reserves the right to refuse
the issuance of monthly stickers or other parking identification devices to any
tenant and/or its employees who refuse to comply with the above Rules and
Regulations and all City, State or Federal ordinances, laws or agreements.
(o) Tenant agrees to acquaint all employees with these Rules
and Regulations.
(p) No vehicle shall be stored in the garage for a period of
more than one (1) week.
EXHIBIT "B"
5
Initials: ____
____
EXHIBIT "C"
NOTICE OF LEASE TERM DATES
AND TENANT'S PROPORTIONATE SHARE
TO: _____________________________ DATE: ________________________
_____________________________
_____________________________
RE: Lease dated ______________, 19____, between___________________________
___________________________________("Landlord"), and___________________________
___________________________________("Tenant"), concerning Suite ___________,
located at ____________________________________________________.
Ladies and Gentlemen:
In accordance with the Lease, Landlord wishes to advise and/or
confirm the following:
1. That the Premises have been accepted herewith by the Tenant as
being substantially complete in accordance with the Lease and that there is no
deficiency in construction.
2. That the Tenant has taken possession of the Premises and
acknowledges that under the provisions of the Lease the Term of said Lease
shall commence as of ______________ for a term of _________________________
ending on ______________________________________.
3. That in accordance with the lease, Basic Rental commenced to
accrue on _______________________________________.
4. If the Commencement Date of the Lease is other than the first day
of the month, the first billing will contain a prorata adjustment. Each
billing thereafter shall be for the full amount of the monthly installment as
provided for in said Lease.
5. Rent is due and payable in advance on the first day of each and
every month during the Term of said Lease. Your rent checks should be made
payable to ________________________________ at _______________________________
_____________________________________________.
6. The exact number of rentable square feet within the Premises is
____ square feet.
EXHIBIT "C"
1
Initials: ____
____
7. Tenant's Proportionate Share, as adjusted based upon the exact
number of rentable square feet within the Premises is _______%.
AGREED AND ACCEPTED:
TENANT:
______________________________,
a_____________________________
By: ________________________
Its:____________________
EXHIBIT "C"
2
Initials: ____
____
EXHIBIT "D"
TENANT WORK LETTER
This Tenant Work Letter shall set forth the terms and conditions
relating to the renovation of the tenant improvements in the Premises. This
Tenant Work Letter is essentially organized chronologically and addresses the
issues of the renovation of the Premises, in sequence, as such issues will
arise.
SECTION 1
LANDLORD'S INITIAL CONSTRUCTION IN THE PREMISES
Landlord has constructed, at its sole cost and expense, the base,
shell and core (i) of the Premises, and (ii) of the floor of the Project on
which the Premises is located (collectively, the "Base, Shell and Core").
Tenant has inspected and hereby approves the condition of the Base, Shell and
Core, and agrees that the Base, Shell and Core shall be delivered to Tenant in
its current "as-is" condition. The improvements to be initially installed in
the Premises shall be designed and constructed pursuant to this Tenant Work
Letter. Any cost of initial design and construction of any improvements to the
Premises shall be a "Tenant Improvement Allowance Item," as that term is
defined in Section 2.2. of this Tenant Work Letter.
SECTION 2
TENANT IMPROVEMENTS
2.1 TENANT IMPROVEMENT ALLOWANCE. Tenant shall be entitled to a
one-time tenant improvement allowance (the "Tenant Improvement Allowance") in
the amount of $301,180.00 (based upon $20.00 per useable square foot contained
within the Premises for the costs relating to the initial design and
construction of Tenant's improvements which are permanently affixed to the
Premises (the "Tenant Improvements"). In no event shall Landlord be obligated
to make disbursements pursuant to this Tenant Work Letter in a total amount
which exceeds the Tenant Improvement Allowance and in no event shall Tenant be
entitled to any credit for any portion of the Tenant Improvement Allowance
which is not used by Tenant on or before the date which is three (3) months
after the Commencement Date. Notwithstanding the foregoing, in the event costs
to be incurred for the Tenant Improvements exceed the Tenant Improvement
Allowance, Tenant may elect, by written notice to Landlord at any time on or
before the commencement of construction, to increase the Tenant Improvement
Allowance by up to Five Dollars ($5.00) per usable square foot contained
within the Premises ("Additional Allowance"). If Tenant exercises its option
to so increase the Tenant Improvement Allowance, Monthly Basic Rental for the
Premises shall be increased throughout the initial Term by an amount
sufficient to amortize the Additional Allowance over a ten (10) year term
based upon equal monthly payments of principal and interest, with interest
imputed on the outstanding principal balance at ten percent (10%) per annum.
EXHIBIT "D"
1
Initials: ____
____
2.2 DISBURSEMENT OF THE TENANT IMPROVEMENT ALLOWANCE.
2.2.1 TENANT IMPROVEMENT ALLOWANCE ITEMS. Except as
otherwise set forth in this Tenant Work Letter, the Tenant Improvement
Allowance shall be disbursed by Landlord (which disbursements shall be made
pursuant to Section 2.2.2 below) for costs related to the construction of the
Tenant Improvements and for the following items and costs (collectively, the
"Tenant Improvement Allowance Items"): (i) payment of the fees of the
"Architect" and the "Engineers," as those terms are defined in Section 3.1 of
this Tenant Work Letter, and payment of the fees incurred by, and the cost of
documents and materials supplied by, Landlord and Landlord's consultants in
connection with the preparation and review of the "Construction Drawings," as
that term is defined in Section 3.1 of this Tenant Work Letter; (ii) the cost
of permits, construction supervision fees and the cost of installing data and
voice cabling throughout the Premises; (iii) the cost of any changes in the
Base, Shall and Core required by the Construction Drawings; and (iv) the cost
of any changes to the Construction Drawings or Tenant Improvements required by
applicable building codes (the "Code").
2.2.2 DISBURSEMENT OF TENANT IMPROVEMENT ALLOWANCE. A check
for that portion of the Tenant Improvement Allowance used by Tenant for the
Tenant Improvement Allowance Items payable to Contractor and/or Tenant's
Agents (as applicable) shall be delivered by Landlord to Tenant within thirty
(30) days after Tenant provides Landlord with documentation reasonably
acceptable to Landlord that Tenant has paid for at least $451,770.00 in costs
for Tenant Improvement Allowance Items for the Premises, provided that Tenant
delivers to Landlord properly executed unconditional or conditional mechanics
lien releases in a form reasonably acceptable to Landlord together with
invoices from all of Tenant's Agents and all other information reasonably
requested by Landlord. Landlord shall only be obligated to make disbursements
from the Tenant Improvement Allowance to the extent costs are incurred by
Tenant for Tenant Improvement Allowance Items.
2.3 STANDARD TENANT IMPROVEMENTS. Landlord shall be entitled to
designate specifications for any improvements in the Premises which are
visible from the exterior of the Building including, without limitation, any
window coverings.
SECTION 3
CONSTRUCTION DRAWINGS
3.1 SELECTION OF ARCHITECT/CONSTRUCTION DRAWINGS. Tenant shall
retain an architect/space planner reasonably approved by Landlord (the
"Architect") to prepare the "Construction Drawings," as that term is defined
in this Section 3.1. Tenant shall also retain the engineering consultants
reasonably approved by Landlord (the "Engineers") to prepare all plans and
engineering working drawings relating to the structural, mechanical,
electrical, plumbing, HVAC and lifesafety work of the Tenant Improvements.
Landlord agrees that, subject to the terms of this Tenant Work Letter, the
Tenant Improvements may be designed and constructed on a "design/build" basis.
The plans and drawings to be prepared by Architect and the Engineers hereunder
shall be known collectively as the "Construction Drawings." All Construction
Drawings shall comply with the drawing format and specifications as reasonably
determined by
EXHIBIT "D"
2
Initials: ____
____
Landlord, and shall be subject to Landlord's reasonable approval. Tenant and
Architect shall verify, the in the field, the dimensions and conditions as
shown on the relevant portions of the base building plans, and Tenant and
Architect shall be solely responsible for the same, and Landlord shall have no
responsibility in connection therewith. Landlord's review of the Construction
Drawings as set forth in this Section 3, shall be for its sole purpose and
shall not imply Landlord's review of the same, or obligate Landlord to review
the same, for quality, design, Code compliance or other like matters.
Accordingly, notwithstanding that any Construction Drawings are reviewed by
Landlord or its space planner, architect, engineers and consultants, and
notwithstanding any advice or assistance which may be rendered to Tenant by
Landlord or Landlord's space planner, architect, engineers, and consultants,
Landlord shall have no liability whatsoever in connection therewith and shall
not be responsible for any omissions or errors contained in the Construction
Drawings.
3.2 FINAL SPACE PLAN. Tenant and the Architect shall prepare the
final space plan for Tenant Improvements in the Premises (collectively, the
"Final Space Plan"), which Final Space Plan shall include a layout and
designation of all offices, rooms and other partitioning, their intended use,
and equipment to be contained therein, and shall deliver the Final space Plan
to Landlord for Landlord's approval. Landlord may request clarification or
more specific drawings for special use items not included in the Final Space
Plan. Landlord shall advise Tenant within ten (10) days after Landlord's
receipt of the Final space Plan for the Premises if the same is unsatisfactory
or incomplete in any respect. If Tenant is so advised, Tenant shall promptly
cause the Final Space Plan to be revised to correct any deficiencies or other
matters Landlord may reasonably require.
3.3 FINAL WORKING DRAWINGS. Upon Landlord's approval of the
Final Space Plan, Tenant, the Architect and the Engineers shall complete the
architectural and engineering drawings for the Premises, and the final
architectural working drawings in a form which is complete to allow
subcontractors to bid on the work and to obtain all applicable permits
(collectively, the "Final Working Drawings") and shall submit the same, or
components thereof prepared on a "design/build" basis, to Landlord for
Landlord's approval. Landlord may request clarification or more specific
drawings for special use items not included in the Final Working Drawings.
Landlord shall advise Tenant within ten (10) days after Landlord's receipt of
the Final Working Drawings for the Premises, or any component thereof, if the
same is unsatisfactory or incomplete in any respect. If Tenant is so advised,
Tenant shall promptly cause the Final Working Drawings (or such component) to
be revised to correct any deficiencies or other matters Landlord may
reasonably require.
3.4 PERMITS. The Final Working Drawings shall be approved by
Landlord (the "Approved Working Drawings") prior to the commencement of the
construction of the Tenant Improvements. Tenant shall cause the Architect to
immediately submit the Approved Working Drawings to the appropriate municipal
authorities for all applicable building permits necessary to allow
"Contractor," as that term is defined in Section 4.1, below, to commence and
fully complete the construction of the Tenant Improvements (the "Permits"). No
changes, modification or alterations (except de minimis changes which shall be
reflected in the as-built drawings) in the Approved Working Drawings may be
made without the prior written consent of Landlord, which consent shall not be
unreasonably withheld or delayed.
EXHIBIT "D"
3
Initials: ____
____
SECTION 4
CONSTRUCTION OF THE TENANT IMPROVEMENTS
4.1 CONTRACTOR. Tenant shall select either Tishman West or
Xxxxxx Construction as the general contractor for the Tenant Improvements and
shall notify Landlord upon such selection. The contractor so selected may be
referred to herein as the "Contractor."
4.2 TENANT'S AGENTS. All subcontractors, laborers, materialmen,
and suppliers used by Tenant (such subcontractors, laborers, materialmen, and
suppliers, and the Contractor to be known collectively as "Tenant's Agents")
must be approved in writing by Landlord, which approval shall not be
unreasonably withheld or delayed. If Landlord does not approve any of the
Tenant's proposed subcontractors, laborers, materialmen or suppliers, Tenant
shall submit other proposed subcontractors, laborers, materialmen or suppliers
for Landlord's written approval. Notwithstanding the foregoing, Tenant shall
be required to utilize either (i) CSI Electric, Xxxx Electric, Angeles
Electric or X. X. Xxxxxx Electric for any electrical work, and (ii) Air-Tech,
ACCO or Xxxxx Heating and Air Conditioning for any mechanical work.
4.3 CONSTRUCTION CONTRACT; COST BUDGET. Prior to Tenant's
execution of the construction contract and general conditions with Contractor
(the "Contract"), Tenant shall submit the Contract to Landlord for its
approval, which approval shall not be unreasonably withheld or delayed. prior
to the commencement of the construction of the Tenant Improvements, and after
Tenant has accepted all bids for the Tenant Improvements, Tenant shall provide
Landlord with a detailed breakdown, by trade, of the final costs to be
incurred or which have been incurred in connection with the design and
construction of the Tenant Improvements to be performed by or at the direction
of Tenant or the Contractor, which costs form a basis for the amount of the
contract (the "Final Costs"). Tenant shall be responsible for any excess of
the amount of the Final Costs over the amount of the Tenant Improvement
Allowance.
4.4 LANDLORD'S GENERAL CONDITIONS FOR TENANT'S AGENTS AND TENANT
IMPROVEMENT WORK. Tenant's and Tenant's Agent's construction of the Tenant
Improvements shall comply with the following: (i) the Tenant Improvements
shall be constructed in strict accordance with the Approved Working Drawings;
and (ii) Tenant shall abide by all rules made by Landlord's Project manager
with respect to the use of freight, loading dock and service elevators (if
any), storage of materials, coordination of work with the contractors of other
tenants, and any other matter in connection with this Tenant Work Letter,
including, without limitation, the construction of the Tenant Improvements.
4.5 INDEMNITY. Tenant's indemnity of Landlord as set forth in
Article 13 of this Lease shall also apply with respect to any and all costs,
losses, damages, injuries and liabilities related in any way to any act or
omission of Tenant or Tenant's Agents, or anyone directly or indirectly
employed by any of them, or in connection with the Tenant's non-payment of any
amount arising out of the Tenant Improvements and/or Tenant's disapproval of
all or any portion of any request for payment. Such indemnity by Tenant, as
set forth in Article 13 of this Lease, shall also apply with respect to any
and all costs, losses, damages, injuries and liabilities related in any way to
Landlord's performance of any ministerial acts reasonably necessary (i) to
permit Tenant to
EXHIBIT "D"
4
Initials: ____
____
complete the Tenant Improvements, and (ii) to enable Tenant to obtain any
building permit or certificate or occupancy for the Premises.
4.6 REQUIREMENT OF TENANT'S AGENTS. Each of Tenant's Agents
shall guarantee to Tenant and for the benefit of Landlord that the portion of
the Tenant Improvements for which it is responsible shall be free from any
defects in workmanship and materials for a period of not less than one (1)
year from the date of completion thereof. All such warranties or guarantees as
to materials or workmanship of or with respect to the Tenant Improvements
shall be contained in the Contract or subcontract and shall be written such
that such guarantees or warranties shall inure to the benefit of both Landlord
and Tenant, as their respective interests may appear, and can be directly
enforced by either. Tenant covenants to give to Landlord any assignment or
other assurances which may be necessary to effect such right of direct
enforcement.
4.7 INSURANCE REQUIREMENTS.
4.7.1 GENERAL COVERAGES. All of Tenant's Agents shall carry
workers' compensation insurance covering all of their respective employees,
and shall also carry public liability insurance, including property damage,
all with limits, in form and with companies as are required to be carried by
Tenant as set forth in Article 14 of this Lease.
4.7.2 SPECIAL COVERAGES. Tenant or Tenant's Contractor shall
carry "Builder's All Risk" insurance in an amount approved by Landlord
covering the construction of the Tenant Improvements, and such other insurance
as Landlord may reasonably require.
4.7.3 GENERAL TERMS. Certificates for all insurance carried
pursuant to this Section 4.7 shall be delivered to Landlord before the
commencement of construction of the Tenant Improvements and before the
Contractor's equipment is moved onto the site. All such policies of insurance
must contain a provision that the company writing said policy will given
Landlord thirty (30) days prior written notice of any cancellation or lapse of
the effective date or any reduction in the amounts of such insurance. In the
event that the Tenant Improvements re damaged by any cause during the course
of the construction thereof, Tenant shall immediately repair the same at
Tenant's sole cost and expense. Tenant's Agents shall maintain all of the
foregoing insurance coverage in force until the Tenant Improvements are fully
completed and accepted by Landlord. All policies carried under this Section
4.7 shall insure Landlord and Tenant, as their interests may appear, as well
as Contractor and Tenant's Agents. All insurance, except Workers'
Compensation, maintained by Tenant's Agents shall preclude subrogation claims
by the insurer against anyone insured thereunder. Such insurance shall provide
that it is primary insurance as respects the owner and that any other
insurance maintained by owner is excess and noncontributing with the insurance
required hereunder.
4.8 GOVERNMENTAL COMPLIANCE. The Tenant Improvements shall
comply in all respect with the following: (i) all applicable codes and other
state, federal, city or quasi-governmental laws, codes, ordinances and
regulations, as each may apply according to the rulings of the controlling
public official, agent or other person; (ii) applicable standards of the
American Insurance Association (formerly, the National Board of Fire
Underwriters) and the National Electrical Code; and (iii) building material
manufacturer's specifications.
EXHIBIT "D"
5
Initials: ____
____
4.9 INSPECTION BY LANDLORD. Landlord shall have the right to
inspect the Tenant Improvements at all times, provided, however, that the
Landlord's failure to inspect the Tenant Improvements shall in no event
constitute a waiver of any of Landlord's rights hereunder nor shall Landlord's
inspection of the Tenant Improvements constitute Landlord's approval of the
same. Should Landlord disapprove any portion of the Tenant Improvements,
Landlord shall notify Tenant in writing of such disapproval and shall specify
the items disapproved. Any defects or deviations in, and/or disapproval by
Landlord of, the Tenant Improvements shall be rectified by Tenant at no
expense to Landlord, provided, however, that (i) in the event Landlord
determines that a defect or deviation exists or disapproves of any matter in
connection with any portion of the Tenant Improvements and such defect,
deviation or matter might adversely affect the mechanical, electrical,
plumbing, heating, ventilating and air conditioning or life-safety systems of
the Project, the structure or exterior appearance of the Project or any other
tenant's use of such other tenant's leased premises, Landlord may take such
action as Landlord deems necessary, at Tenant's expense and without incurring
any liability on Landlord's part, to correct any such defect, deviation and/or
matter, including, without limitation, causing the cessation of performance of
the construction of the Tenant Improvements until such time as the defect,
deviation and/or matter is correct to Landlord's satisfaction, and (ii) any
defects or deviations resulting from the requirements of the Engineers
designated by Landlord for tie-in of the systems of the Premises to the
systems of the Building pursuant to Section 3.1 above shall be the
responsibility of Landlord.
4.10 NOTICE OF COMPLETION; COPY OF RECORD SET OF PLANS. Within
ten (10) days after completion of construction of the Tenant Improvements,
Tenant shall cause a Notice of Completion to be recorded in the office of the
Recorder of the appropriate County in accordance with Section 3093 of the
Civil Code of the State of California or any successor statute, and shall
furnish a copy thereof to Landlord upon such recordation. If Tenant fails to
do so, Landlord may execute and file the same on behalf of Tenant as Tenant's
agent for such purpose, at Tenant's sole cost and expense. At the conclusion
of construction, (i)Tenant shall cause the Architect and Contractor (A) to
update the Approved Working Drawings as necessary to reflect all changes made
to the Approved Working Drawings during the course of construction, (B) to
certify to the best of their knowledge that the "record-set" of as-built
drawings are true and correct, which certification shall survive the
expiration or termination of this Lease, and (C) to deliver to Landlord two
(2) sets of copies of such record set of drawings within ninety (90) days
following issuance of a certificate of occupancy for the Premises, and (ii)
Tenant shall deliver to Landlord a copy of all warranties, guaranties, and
operating manuals and information relating to the improvements, equipment, and
systems in the Premises.
SECTION 5
COMPLETION OF THE TENANT IMPROVEMENTS
The October 1, 1997 component of the definition of the Commencement
Date specified in Article 1.A of the Lease shall be extended one (1) day for
each day that Tenant is delayed in completing the Tenant Improvements in the
Premises as a result of an "Uncontrollable Delay" or a "Landlord Delay." The
term "Uncontrollable Delay" shall mean only an actual delay in the completion
of the Tenant Improvements resulting directly from fire, earthquake, flood,
acts of
EXHIBIT "D"
6
Initials: ____
____
God, industry-wide labor strikes or lockouts which objectively preclude Tenant
from obtaining labor or substitute materials necessary for completing the
Tenant Improvements, a moratorium on the issuance of governmental permits or
approvals or an extension of the time ordinarily required by applicable
governmental entities to issue such permits and approvals beyond the time
period normally required for such permits and approvals as of June 1, 1997
(but only where such extension is not due to (i) the acts or omissions of
Tenant, the Architect or the Contractor or any of Tenant's Agents or (ii) such
governmental entity's determination that any plans do not comply with
governmental laws, codes or other regulations) or any other cause beyond the
control of Tenant. The term "Landlord Delay" shall mean only an actual delay
in the completion of the Tenant Improvements which is directly caused by (a)
the failure of Landlord to provide authorizations or approvals within the time
periods set forth in this Tenant Work Letter; (b) the material interference by
Landlord with the completion of the Tenant Improvements or the refusal of
Landlord to permit Tenant's Agents reasonable access to the Premises as
required in this Tenant Work Letter; or (c) Landlord's failure to provide
Tenant with possession of the Premises for the purpose of constructing the
Tenant Improvements after the Final Working Drawings have been approved by
Landlord and Tenant has received all necessary governmental permits and
approvals. Notwithstanding anything to the contrary contained herein, neither
an Uncontrollable Delay nor a Landlord Delay shall include any of the
foregoing delays to the extent caused by the acts, omissions or misconduct of
Tenant, or Tenant's Agents. No Uncontrollable Delay or Landlord Delay shall be
deemed to have occurred unless Tenant has given Landlord written notice that
an act or omission on the part of Landlord or its agents is about to occur or
has occurred (with respect to an alleged Landlord Delay) or that an event
giving rise to an Uncontrollable Delay is about to occur or has occurred (with
respect to an Uncontrollable Delay) which will cause a delay in the completion
of the Tenant Improvements and Landlord has failed to cure such delay (with
respect to a Landlord Delay) or has failed to remedy the situation giving rise
to a potential Uncontrollable Delay (with respect to an alleged Uncontrollable
Delay) within one (1) business day after Landlord's receipt of such notice, in
which case the number of days of delay after such notice shall be a Landlord
Delay or an Uncontrollable Delay, as applicable.
SECTION 6
MISCELLANEOUS
6.1 TENANT'S REPRESENTATIVE. Prior to commencement of
construction of Tenant Improvements, Tenant shall designate a representative
with respect to the matters set forth in this Tenant Work Letter, who, until
further notice to Landlord, shall have full authority and responsibility to
act on behalf of the Tenant as required in this Tenant Work Letter.
6.2 LANDLORD'S REPRESENTATIVE. Prior to commencement of
construction of Tenant Improvements, Landlord shall designate a representative
with respect to the matters set forth in this Tenant Work Letter, who, until
further notice to Tenant, shall have full authority and responsibility to act
on behalf of the Landlord as required in this Tenant Work Letter.
6.3 TIME OF THE ESSENCE IN THIS TENANT WORK LETTER. Unless
otherwise indicated, all references herein to a "number of days" shall mean
and refer to calendar days.
EXHIBIT "D"
7
Initials: ____
____
