STANDARD INDUSTRIAL LEASE - MULTI-TENANT
AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION
1. Parties. This Lease. dated, for reference purposes only, August 31, 1995, is
made by and between The Prudential Insurance Company of America, a New Jersey
Corporation (herein called "Lessor") and WAWD-EAP AUTOMOTIVE PRODUCTS, INC., a
Delaware corporation (herein called "Lessee").
2. Premises, Parking and Common Areas.
2.1 Premises. Lessor hereby leases to Lessee and Lessee leases from Lessor
for the term, at the rental, and upon all of the conditions set forth herein,
real property situated in the County of Los Angeles, State of California
commonly known as 0000 X. 00xx Xxxxxx, Xxxxxx Xxxxxxxxxx 00000 and described as
the portion containing 51,928 square feet of the building located on the
property shown on Exhibit "A" hereto, said 51,928 square feet herein referred to
as the "Premises" and cross-hatched on Exhibit "A" attached hereto including
rights to the Common Areas as hereinafter specified but not including any rights
to the roof of the Premises or to any Building in the Industrial Center. The
Premises are a portion of a building, herein referred to as the "Building". The
Premises, the Building, the Common Areas, the land upon which the same are
located, along with all other buildings and improvements thereon, are herein
referred to as the AIndustrial Center.
2.2 Vehicle Parking. Lessee shall be entitled the number of vehicle parking
spaces as set forth in Paragraph 66 unreserved and unassigned, on those portions
of the Common Areas designated by Lessor for parking. Lessee shall not use more
parking spaces than said number. Said Parking spaces shall be used only for
parking by vehicles no larger than full size passenger automobiles or pick-up
trucks, herein called "Permitted Size Vehicles". Vehicles other than Permitted
Size Vehicles are herein referred to as "Oversized Vehicles".
2.2.1 Lessee shall not permit or allow any vehicles that belong to or are
controlled by Lessee or Lessee's employees, suppliers, shippers, customers, or
invitees to be loaded, unloaded, or parked in areas other than those designated
by Lessor for Such activities.
2.2.2 If Lessee permits or allows any of the prohibited activities
described in paragraph 2.2 of this Lease, then Lessor shall have the right,
without notice, in addition to such other rights and remedies that it may have,
to remove or tow away the vehicle involved and charge the cost to Lessee, which
cost shall be immediately payable upon demand by Lessor.
2.3 Common Areas-Definition. The term "Common Areas" is defined as all areas
and facilities outside the Premises and within the exterior boundary line of the
industrial Center that are provided and designated by the Lessor from time to
time for the general non-exclusive use of Lessor, Lessee and of other lessees of
the Industrial Center and their respective employees, suppliers, shippers,
customers and invitees, including parking areas, loading and unloading areas,
trash areas, roadways, sidewalks, walkways, parkways, driveways and landscaped
areas.
2.4 Common Areas - Losses's Rights. Lessor hereby grants to Lessee, for the
benefit of Lessee and its employees, suppliers, shippers, customers and
invitees, during the term of this Lease, the non-exclusive right to use, in
common with others entitled to such use, the Common Areas as they exist from
time to time, subject to any rights, powers, and privileges reserved by Lessor
under the terms hereof or under the terms of any rules and regulations or
restrictions governing the use of the Industrial Center. Under no circumstances
shall the right herein granted to use the Common Areas be deemed to include the
right to store any property, temporarily or permanently, in the Common Areas.
Any such Storage shall be permitted only by the prior written consent of Lessor
or Lessor's designated agent, which consent may be revoked at any time. In the
event that any unauthorized storage shall occur then Lessor shall have the
right, without notice, in addition to such other rights and remedies that it may
have, to remove the property and charge the cost to Lessee, which cost shall be
immediately payable upon demand by Lessor.
2.5 Common Areas - Rules and Regulations. Lessor or such other person(s) as
Lessor may appoint shall have the exclusive control and management of the Common
Areas and shall have the right, from time to time, to establish, modify, amend
and enforce reasonable rules and regulations with respect thereto. Lessee agrees
to abide by and conform to all such rules and regulations, and to cause its
employees, suppliers, shippers, customers, and invitees to so abide and conform.
Lessor shall not be responsible to Lessee for the non-compliance with said rules
and regulations by other lessees of the Industrial Center.
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2.6 Common Areas - Changes. Lessor shall have the right, in Lessor's sole
discretion from time to time:
(a) To make changes to the Common Areas, including, without limitation,
changes in the location size, shape and number of driveways, entrances, parking
spaces, parking areas, loading and unloading areas, ingress, egress, direction
of traffic, landscaped areas and walkways; (b) To close temporarily any of the
Common Areas for maintenance purposes so long as reasonable access to the
Premises remains available; (c) To designate other land outside the boundaries
of the Industrial Center to be a part of the Common Areas; (d) To add additional
buildings and improvements to the Common Areas; (e) To use the Common Areas
while engaged in making additional improvements, repairs or alterations to the
industrial Center, or any portion thereof; (f) To do and perform such other act
and make such other changes in, to or with respect to the Common Areas and
Industrial Center as Lessor may, in the exercise of sound business judgment,
deem to be appropriate.
2.6.1 Lessor shall at all times provide the parking facilities required
by applicable law and in no event shall the number of parking spaces that Lessee
is entitled to under paragraph 2.2 be reduced.
3. Term.
3.1 Term. The term of this Lease shall be for seven (7) years and no months
commencing on January 1, 1996 and ending on December 31, 2002 unless sooner
terminated pursuant to any provision hereof.
3.2 Delay In Possession. Notwithstanding said commencement date, if for any
reason Lessor cannot deliver possession of the Premises to Lessee on said date,
Lessor shall not be subject to any liability therefor, nor shall such failure
affect the validity of this Lease or the obligations of Lessee hereunder or
extend the term hereof, but in such case, Lessee shall not be obligated to pay
rent or perform any other obligation of Lessee under the terms of this Lease,
except as may be otherwise provided in this Lease, until possession of the
Premises is tendered to Lessee; provided, however, that if Lessor shall not have
delivered possession of the Premises within Sixty (60) days from said
commencement date, Lessee may, at Lessee's option, by notice in writing to
Lessor within ten (10) days thereafter, cancel this Lease, in which event the
parties shall be discharged from all obligations hereunder, provided further,
however, that if such written notice of Lessee is not received by Lessor within
said ten (10) day period, Lessee's right to cancel this Lease hereunder shall
terminate and be of no further force or effect.
3.3 Early Possession. If Lessee occupies the Premises prior to said
commencement date, such occupancy shall be subject to all provisions of this
Lease, such occupancy shall not advance the termination date, and Lessee shall
pay rent for such period at the initial monthly rates set forth below.
4. Rent.
4.1 Base Rent. Lessee shall pay to Lessor, as Base Rent for the Premises,
without any offset or deduction, except as may be otherwise expressly provided
in this Lease, on the 1st day of each month of the term hereof, monthly payments
in advance of $15,578.40, the Base Rent is subject to adjustment as provided
herein. Lessee shall pay Lessor upon execution hereof $15,578.40 as Base Rent
for January, 1996. Rent for any period during the term hereof which is for less
than one month shall be a pro rata portion of the Base Rent. Rent shall be
payable in lawful money of the United States to Lessor at the address stated
herein or to such other persons or at such other places as Lessor may designate
in writing.
4.2 Operating Expenses. Lessee shall pay to Lessor during the term hereof, in
addition to the Base Rent, Lessee's Share, as hereinafter defined, of all
Operating Expenses, as hereinafter defined, during each calendar year of the
term of this Lease, in accordance with the following provisions:
(a) "Lessee's Share" is defined, for purposes of this Lease, as 38.9612
percent.
(b) "Operating Expenses" is defined, for purposes of this Lease, as all
costs incurred by Lessor, if any, for:
(i) The operation, repair and maintenance, in neat, clean, good order
and condition, of the following:
(aa) The Common Areas, including parking areas, loading and
unloading areas, trash areas, roadways, sidewalks, walkways, parkways,
driveways, landscaped areas, striping, bumpers, irrigation systems, Common Area
lighting facilities and fences and gates:
(bb) Trash disposal services:
(cc) Tenant directories:
(dd) Fire detection systems including sprinkler system
maintenance and repair:
(ee) Security services:
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(ff) Any other service to be provided by Lessor that is elsewhere
in this Lease stated to be an "Operating Expense."
(ii) Any deductible portion of an insured loss concerning any of the
items or matters described in this paragraph 4.2.
(iii) The cost of the premiums for the liability and property
insurance policies to be maintained by Lessor under paragraph 8 hereof.
(iv) The amount of the real property tax to be paid by Lessor under
paragraph 10.1 hereof:
(v) The cost of water, gas and electricity to service the Common
Areas.
(c) The inclusion of the improvements, facilities and services set forth
in Paragraph 4.2(b)(i) of the definition of Operating Expenses shall not be
deemed to impose an obligation upon Lessor to either have said improvements or
facilities or to provide those services unless the industrial Center already has
the same. Lessor already provides the services, or Lessor has agreed elsewhere
in this Lease to provide the same or some of them.
(d) Lessee's Share of Operating Expenses shall be payable by Lessee
within ten (10) days after a reasonably detailed statement of actual expenses is
presented to Lessee by Lessor. At Lessor's option, however, an amount may be
estimated by Lessor from time to time of Lessee's Share of annual Operating
Expenses and the same shall be payable monthly or quarterly, as Lessor shall
designate, during each twelve-month period of the Lease term, on the same day as
the Base Rent is due hereunder. In the event that Lessee pays Lessor's estimate
of Lessee's Share of Operating Expenses as aforesaid, Lessor shall deliver to
Lessee within sixty (60) days after the expiration of each calendar year a
reasonably detailed statement showing Lessee's Share of the actual Operating
Expenses incurred during the preceding year. If Lessee's payments under this
paragraph 4.2(d) during said preceding year exceed Lessee's Share as indicated
on said statement, Lessee shall be entitled to credit the amount of such
overpayment against Lessee's Share of Operating Expenses next falling due. If
Lessee's payments under this paragraph during said preceding year were less than
Lessee's Share as indicated on said statement, Lessee shall pay to Lessor the
amount of the deficiency within ten (10) days after delivery by Lessor to Lessee
of said statement.
5. Security Deposit. Lessee shall deposit with Lessor upon execution hereof
$15,578.40 as security for lessee's faithful performance of Lessee's obligations
hereunder. If Lessee fails to pay rent or other charges due hereunder, or
otherwise defaults with respect to any provision of this Lease, Lessor may use,
apply or retain all or any portion of said deposit for the payment of any rent
or other charge in default or for the payment of any other sum to which Lessor
may become obligated by reason of Lessee's default, or to compensate Lessor for
any loss or damage which Lessor may suffer thereby. If Lessor so uses or applies
all or any portion of said deposit, Lessee shall within ten (10) days after
written demand therefor deposit cash with Lessor in an amount sufficient to
restore said deposit to the full amount then required of Lessee. If the monthly
rent shall, from time to time, increase during the term of this Lease, Lessee
shall, at the time of such increase, deposit with Lessor additional money as a
security deposit so that the total amount of the security deposit held by Lessor
shall at all times bear the same proportions to the then current Base Rent as
the initial security deposit bears to the initial Base Rent set forth in
paragraph 4. Lessor shall not be required to keep said security deposit separate
from its general accounts. If Lessee performs all of Lessee's obligations
hereunder, said deposit, or so much thereof as has not theretofore been applied
by Lessor, shall be returned, without payment of interest or other increment for
its use, to Lessee (or, at Lessor's option, to the last assignee, if any, of
Lessee's interest hereunder) at the expiration of the term hereof, and after
Lessee has vacated the Premises. No trust relationship is created herein between
Lessor and Lessee with respect to said Security Deposit.
6. Use.
6.1 Use. The Premises shall be used and occupied only for warehousing and
distribution of new automotive parts and for no other purpose.
6.2 Compliance with Law.
(a) Lessor warrants to Lessee to Lessor's actual knowledge that the
Premises, in the state existing on the date that the Lease term commences, but
without regard to alterations made by Lessee or the use for which Lessee will
occupy the Premises, does not violate any covenants or restrictions of record,
or any applicable building code, regulation or ordinance in effect on such Lease
term commencement date. In the event it is determined that this warranty has
been violated, then it shall be the obligation of the Lessor, after written
notice from Lessee, to promptly, at Lessor's sole cost and expense, rectify any
such violation. In the event Lessee does not give to Lessor written notice of
the violation of this warranty within six months from the date that the Lease
term commences, the correction of same shall be the obligation of the Lessee at
Lessee's sole cost. The warranty contained in this paragraph 6.2(a) shall be of
no force or effect if, prior to the date of this Lease, Lessee was an owner or
occupant of the Premises and, in such event, Lessee shall correct any such
violation at Lessee's sole cost.
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(b) Except as provided in paragraph 6.2(a) Lessee shall, at Lessee's
expense, promptly comply with all applicable statutes, ordinances, rules,
regulations, orders, covenants and restrictions of record. and requirements of
any fire insurance underwriters or rating bureaus, now in effect or which may
hereafter come into effect, whether or not they reflect a change in policy from
that now existing, during the term or any part of the term hereof, relating in
any manner to the Premises and the occupation and use by Lessee of the Premises
and of the Common Areas. Lessee shall not use nor permit the use of the Premises
or the Common Areas in any manner that will tend to create waste or a nuisance
or shall tend to disturb other occupants of the Industrial Center.
6.3 Condition of Premises.
(a) Lessor shall deliver the Premises to Lessee clean and free of debris
on the Lease commencement date (unless Lessee is already in possession) and
Lessor warrants to Lessee to Lessor's actual knowledge that the plumbing,
lighting, air conditioning, heating, and loading doors in the Premises other
than those portions constructed by Lessee shall be in good operating condition
on the Lease commencement date. In the event that it is determined that this
warranty has been violated, then it shall be the obligation of Lessor, after
receipt of written notice from Lessee setting forth with specificity the nature
of the violation, to promptly at Lessor's sole cost, rectify such violation,
Lessee's failure to give such written notice to Lessor within thirty (30) days
after the Lease commencement date shall cause the conclusive presumption that
Lessor has complied with all of Lessor's obligations hereunder. The warranty
contained in this paragraph 6.3(a) shall be of no force or effect if prior to
the date of this Lease, Lessee was an owner or occupant of the Premises.
(b) Except as otherwise provided in this Lease, Lessee hereby accepts the
Premises in their condition existing as of the Lease commencement date or the
date that Lessee takes possession of the Premises, whichever is earlier, subject
to all applicable zoning, municipal, county and state laws, ordinances and
regulations governing and regulating the use of the Premises, and any covenants,
easements or restrictions of record, and accepts this Lease subject thereto and
to all matters disclosed thereby and by any exhibits attached hereto. Lessee
acknowledges that neither Lessor nor Lessor's agent has made any representation
or warranty as to the present of future suitability of the Premises for the
conduct of Lessee's business.
7. Maintenance, Repairs, Alterations and Common Area Services.
7.1 Lessor's Obligations. Subject to the provisions of paragraphs 4.2
(Operating Expenses), 6 (Use), 7.2 (Lessee's Obligations), 48 (easements), and 9
(Damage or Destruction) and except for damage caused by any negligent or
intentional act or omission of Lessee, Lessee's employees, suppliers, shoppers,
customers, or invitees, in which event Lessee shall repair the damage. Lessor,
at Lessor's expense, subject to reimbursement pursuant to paragraph 4.2, shall
keep in good condition and repair the foundations, exterior walls, structural
condition of interior bearing walls, and root of the Premises, as well as the
parking lots, walkways, driveways, landscaping, fences, signs and utility
installations of the Common Areas and all parts thereof. Lessor shall not,
however, be obligated to paint the exterior or interior surface of exterior
walls, nor shall Lessor be required to maintain, repair or replace windows,
doors or Plate glass of the Premises or to maintain or repair anything required
to be maintained by Lessee under Paragraph 7.2. Lessor shall have no obligation
to make repairs under this paragraph 7.1 until a reasonable time after receipt
of written notice from Lessee for the need for such repairs. Lessee expressly
waives the benefits of any statute now or hereafter in effect which would
otherwise afford Lessee the right to make repairs at Lessor's expense or to
terminate this Lease because of Lessor's failure to keep the Premises in good
order, condition and repair. Lessor shall not be liable for damages or loss of
any kind or nature by reason of Lessor's failure to furnish any Common Area
Services when such failure is caused by accident, breakage, repairs, strikes,
lockout, or other labor disturbances or disputes of any character, or by any
other cause beyond the reasonable control of Lessor.
7.2 Lessee's Obligations.
(a) Subject to the provisions of paragraphs 6 (Use), 7.1 (Lessor's
Obligations), and 9 (Damage or Destruction), Lessee, at Lessee's expense shall
keep in good order, condition and repair the Premises and every part thereof
(whether or not the damaged portion of the Premises or the means of repairing
the same are reasonably or readily accessible to Lessee) including, without
limiting the generality of the foregoing, all plumbing, heating, ventilating and
air conditioning systems (Lessee shall procure and maintain, at Lessee's
expense, a ventilating and air conditioning system maintenance contract),
electrical and lighting facilities and equipment within the Premiss, or that
serves only the Premises wherever situated, fixtures, interior walls and
interior surfaces of exterior walls, ceilings, windows, doors, plate glass, and
skylights located within the Premises. Lessor reserves the right to procure and
maintain the ventilating and air conditioning system maintenance contract and if
Lessor so elects. Lessee shall reimburse Lessor, upon demand, for the cost
thereof.
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(b) If Lessee fails to perform Lessee's obligations under this paragraph of
this Lease, Lessor may enter upon the Premises after ten (10) days' prior
written notice to Lessee (except in the case of emergency, in which no notice
shall be required), perform such obligations on Lessee's behalf and put the
Premises in good order, condition and repair, and the cost thereof together with
interest thereon at the maximum rate then allowable by law shall be due and
payable as additional rent to Lessor together with Lessee's next Base Rent
installment.
(c) On the last day of the term hereof, or on any sooner termination, Lessee
shall surrender the Premises to Lessor in the same condition as received,
ordinary wear and tear excepted, clean and free of debris. Any damage or
deterioration of the Premises shall not be deemed ordinary wear and tear if the
same could have been prevented by good maintenance practices. Lessee shall
repair any damage to the Premises occasioned by the installation or removal of
Lessee's trade fixtures, alterations, furnishings and equipment. Notwithstanding
anything to the contrary otherwise stated in this Lease, Lessee shall leave the
air lines, power panels, electrical distribution systems, lighting fixtures,
space heaters, air conditioning, plumbing and fencing on the Premises in good
operating condition.
7.3 Alterations and Additions. See Paragraph 49.
(a) Lessee shall not, without Lessor's prior written consent make any
alterations, improvements, additions, or Utility Installations in, on or about
the Premises, or the Industrial Center, except for nonstructural alterations to
the Premises not exceeding $2,500 in cumulative costs, during the term of this
Lease. In any event, whether or not in excess of $2,500 in cumulative cost,
Lessee shall make no change or alteration to the exterior of the Premises nor
the exterior of the Building nor the Industrial Center without Lessor's prior
written consent. As used in this paragraph 7.2 the term "Utility Installation"
shall mean carpeting, window coverings, air lines, power panels, electrical
distribution system, lighting fixtures. space heaters, air conditioning,
plumbing, and fencing. Lessor may require that Lessee remove any or all of said
alterations, improvement, additions or Utility Installations at the expiration
or earlier termination of the term, and restore the Premises and the Industrial
Center to their prior condition. Lessor may require Lessee to provide Lessor, at
Lessee's sole cost and expense, a lien and completion bond in an amount equal to
one and one-half times the estimated cost of such improvements, to insure Lessor
against any liability for mechanic's and materialmen's liens and to insure
completion of the work. Should Lessee make any alterations, improvement,
additions or Utility Installations without the prior approval of Lessor, Lessor
may, at any time during the term of this Lease, require that Lessee remove any
or all of the same.
(b) Any alterations, improvements, additions or Utility Installations in
or about the Premises or the Industrial Center that Lessee shall desire to make
and which requires the consent of the Lessor shall be presented to lessor in
written form, with proposed detailed plan. If Lessor shall give its consent, the
consent shall be deemed conditioned upon Lessee acquiring a permit to do so from
appropriate governmental agencies, the furnishing of a copy thereof to Lessor
prior to the commencement of the work and the compliance by Lessee of all
conditions of said permit in a prompt and expeditious manner.
(c) Lessee shall pay, when due, all claims for labor or materials
furnished or alleged to have been furnished to or for Lessee at or for use in
the Premises, which claims are or may be secured by any mechanic's or
materialmen's lien against the Premises, or the Industrial Center, or any
interest therein. Lessee shall give Lessor not less than thirty (30) days'
notice prior to the commencement of any work in the Premises, and Lessor shall
have the right to post notices of non-responsibility in or on the Premises or
the Building as provided by law. If Lessee shall, in good faith, contest the
validity of any such lien, claim or demand, then Lessee shall, at its sole
expense defend itself and Lessor against the same and shall pay and satisfy any
such adverse judgment that may be rendered thereon before the enforcement
thereof against the Lessor or the Premises or the Industrial Center, upon the
condition that if Lessor shall require, Lessee shall furnish to lessor a surety
bond satisfactory to lessor in an amount equal to such contested lien claim or
demand indemnifying Lessor against liability for the same and holding the
Premises and the Industrial Center free from the effect of such lien or claim.
In addition, Lessor may require Lessee to pay Lessor's attorneys fees and costs
in participating in such action if Lessor shall decide it is to lessor's best
interest to do so.
(d) All alterations, improvements, additions and Utility Installations
(whether or not such Utility Installations constitute trade fixtures of lessee),
which may be on the Premises, shall be the property of Lessor and shall remain
upon and be surrendered with the Premises at the expiration or earlier
termination of the Lease term, unless Lessor requires their removal pursuant to
paragraph 7.3(a). Notwithstanding the provisions of this paragraph 7.3(d),
Lessee's machinery and equipment, other than that which is affixed to the
Premises so that it cannot be removed without material damage to the Premises,
and other than Utility Installations, shall remain the property of Lessee and
may be removed by Lessee subject to the provisions of paragraph 7.2.
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7.4 Utility Additions. Lessor reserves the right to install new or additional
utility facilities throughout the Building and the Common Areas for the benefit
of Lessor or Lessee, or any other lessee of the Industrial Center, including,
but not by way of limitation, such utilities as plumbing, electrical systems,
security systems, communication systems, and fire protection and detection
systems, so long as such installations do not unreasonably interfere with
Lessee's use of the Premises.
8. Indemnity. See Paragraph 50.
8.8 Exemption of Lessor from Liability. Lessee hereby agrees that Lessor
shall not be liable for injury to Lessee's business or any loss of income
therefrom or for damage to the goods, wares, merchandise or other property of
Lessee, Lessee's employees, invitees, customers, or any other person in or about
the Premises or the Industrial Center, nor shall Lessor be liable for injury to
the person of Lessee, Lessee's employees, agents or contractors, whether such
damage or injury is caused by or results from fire, steam, electricity, gas,
water or rain, or from the breakage, leakage, obstruction or other defects of
pipes, sprinklers, wires, appliances, plumbing, air conditioning or lighting
fixtures, or from any other cause, whether said damage or injury results from
conditions arising upon the Premises or upon other portions of the Industrial
Center, or from other sources or places and regardless of whether the cause of
such damage or injury or the means of repairing the same is inaccessible to
Lessee. Lessor shall not be liable for any damages arising from any act or
neglect of any other lessee, occupant or user of the Industrial Center, nor from
the failure of Lessor to enforce the provisions of any other lease of the
Industrial Center.
9. Damage or Destruction.
9.1 Definitions.
(a) "Premises Partial Damage" shall mean if the Premises are damaged or
destroyed to the extent that the cost of repair is less than fifty percent of
the then replacement cost of the Premises.
(b) "Premises Total Destruction" shall mean if the Premises are damaged or
destroyed to the extent that the cost of repair is fifty percent or more of the
then replacement cost of the Premises.
(c) "Premises Building Partial Damage" shall mean if the Building of which
the Premises are a part is damaged or destroyed to the extent that the cost to
repair is less than fifty percent of the then replacement cost of the Building.
(d) "Premises Building Total Destruction" shall mean if the Building of which
the Premises are a part is damaged or destroyed to the extent that the cost to
repair is fifty percent or more of the then replacement cost of the Building.
(e) "Industrial Center Buildings" shall mean all of the buildings on the
Industrial Center site.
(f) "Industrial Center Buildings Total Destruction" shall mean if the
Industrial Center Buildings are damaged or destroyed to the extent that the cost
of repair is fifty percent or more of the then replacement cost of the
Industrial Center Buildings.
(g) "Insured Loss" shall mean damage or destruction which was caused by an
event required to be covered by the insurance described in paragraph 8. The fact
that an Insured Loss has a deductible amount shall not make the loss an
uninsured loss.
(h) "Replacement Cost" shall mean the amount of money necessary to be spent
in order to repair or rebuild the damaged area to the condition that existed
immediately prior to the damage occurring excluding all improvements made by
lessees.
9.2 Premises Partial Damage; Premises Building Partial Damage.
(a) Insured Loss: Subject to the provisions of paragraphs 9.4 and 9.5, if
at any time during the term of this Lease there is damage which [is] an Insured
Loss and which falls into the classification of either Premises Partial Damage
or Premises Building Partial Damage, then Lessor shall, at Lessor's expense,
repair such damage to the Premises, but not Lessee's fixtures, equipment, tenant
improvements or utility installations, as soon as reasonably possible and this
Lease shall continue in full force and effect.
(b) Uninsured Loss: Subject to the provisions of paragraphs 9.4 and 9.5,
if at any time during the term of this Lease there is damage which is not an
Insured Loss and which falls within the classification of Premises Partial
Damage or Premises Building Partial Damage, unless caused by a negligent or
willful act of Lessee (in which event Lessee shall make the repairs at Lessee's
expense), which damage prevents Lessee from using the Premises, Lessor may at
Lessor's option either (i) repair such damage as soon as reasonably possible at
Lessor's expense, in which event this Lease shall continue in full force and
effect, or (ii) give written notice to Lessee within thirty (30) days after the
date of the occurrence of such damage of Lessor's intention to cancel and
terminate this Lease as of the date of the occurrence of such damage. In the
event Lessor elects to give such notice of Lessor's intention to cancel and
terminate this Lease, Lessee shall have the right within ten (10) days after the
receipt of such notice to give written notice to Lessor of Lessee's intention to
repair such damage at Lessee's expense, without reimbursement from Lessor, in
which event this Lease shall continue in full force and effect, and Lessee shall
proceed to make such repairs as soon as reasonably possible. If Lessee does not
give such notice within such 10-day period this Lease shall be canceled and
terminated as of the date of the occurrence of such damage.
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9.3 Premises Total Destruction; Premises Building Total Destruction;
Industrial Center Buildings Total Destruction.
(a) Subject to the provisions of paragraphs 9.4 and 9.5. if at anytime
during the term of this Lease there is damage, whether or not it is an Insured
Loss, and which falls into the classifications of either (i) Premises Total
Destruction, or (ii) Premises Building Total Destruction, or (iii) Industrial
Center Buildings Total Destruction, then Lessor may at Lessor's option either
(i) repair such damage or destruction, but not Lessee's fixtures, equipment or
tenant improvements or Utility installations, as soon as reasonably possible at
Lessor's expense, and this Lease shall continue in full force and effect, or
(ii) give written notice to Lessee within thirty (30) days after the date of
occurrence of such damage of Lessor's intention to cancel and terminate this
Lease, in which case this Lease shall be canceled and terminated as of the date
of the occurrence of such damage.
9.4 Damage Near End of Term.
(a) Subject to paragraph 9.4(b), if at anytime during the last six months
of the term of this Lease there is substantial damage, whether or not an Insured
Loss, which falls within the classification of Premises Partial Damage. Lessor
may at Lessor's option cancel and terminate this Lease as of the date of
occurrence of such damage by giving written notice to Lessee of Lessor's
election to do so within 30 days after the date of occurrence of such damage.
(b) Notwithstanding paragraph 9.4(a), in the event that Lessee has an
option to extend or renew this Lease, and the time within which said option may
be exercised has not yet expired. Lessee shall exercise such option, if it is to
be exercised at all no later than twenty (20) days after the occurrence of an
Insured Loss falling within the classification of Premises Partial Damage during
the last six months of the term of this Lease. If Lessee duly exercises such
option during said twenty (20) day period, Lessor shall, at Lessor's expense,
repair such damage, but not Lessee's fixtures, equipment or tenant improvements,
as soon as reasonably possible and, this Lease shall continue in full force and
effect provided Lessee first deposits with Lessor any shortfall in necessary
funds. If Lessee fails to exercise such option during said twenty (20) day
period, then Lessor may at Lessor's option terminate and cancel this Lease as of
the expiration of said twenty (20) day period by giving written notice to Lessee
of Lessor's election to do so within ten (10) days after the expiration of said
twenty (20) day period, notwithstanding any term or provision in the grant of
option to the contrary.
9.5 Abatement of Rent; Lessee's Remedies.
(a) In the event Lessor repairs or restores the Premises pursuant to the
provisions of this paragraph 9, the rent payable hereunder for the period during
which such damage, repair or restoration continues shall be abated in proportion
to the degree to which Lessee's use of the Premises is impaired. Except for
abatement of rent, if any, Lessee shall have no claim against Lessor for any
damage suffered by reason of any such damage, destruction, repair or
restoration.
(b) If Lessor shall be obligated to repair or restore the Premises under
the provisions of this paragraph 9 and shall not commence such repair or
restoration within ninety (90) days after such obligation shall accrue. Lessee
may at Lessee's option cancel and terminate this Lease by giving Lessor written
notice of Lessee's election to do so at any time prior to the commencement of
such repair or restoration. In such event this Lease shall terminate as of the
date of such notice.
9.6 Termination -- Advance Payments. Upon termination of this Lease pursuant
to this paragraph 9, an equitable adjustment shall be made concerning advance
rent and any advance payments made by Lessee to Lessor. Lessor shall, in
addition, return to Lessee so much of Lessee's security deposit as has not
theretofore been applied by Lessor.
9.7 Waiver. Lessor and Lessee waive the provisions of any statute which
relate to termination of leases when leased property is destroyed and agree that
such event shall be governed by the terms of this Lease.
10. Real Property Taxes.
10.1 Payment of Taxes. Lessor shall pay the real property tax, as defined in
paragraph 10.3, applicable to the Industrial Center subject to reimbursement by
Lessee of Lessee's Share of such taxes in accordance with the provisions of
paragraph 4.2, except as otherwise provided in paragraph 10.2.
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l0.2 Additional improvements. Lessee shall not be responsible for paying
Lessee's Share of any increase in real property tax specified in the tax
assessor's records and work sheets as being caused by additional improvements
placed upon the Industrial Center by other lessees or by Lessor for the
exclusive enjoyment of such other lessees. Lessee shall, however, pay to Lessor
at the time that Operating Expenses are payable under paragraph 4.2(c) the
entirety of any increase in real property tax if assessed solely by reason of
additional improvements placed upon the Premises by Lessee or at Lessee's
request.
10.3 Definition of "Real Property Tax." As used herein, the term "real
property tax" shall include any form of real estate tax or assessment, general,
special, ordinary or extraordinary, and any license fee, commercial rental tax,
improvement bond or bonds, levy or tax (other than inheritance, personal income
or estate taxes) imposed on the industrial Center or any portion thereof by any
authority having the direct or indirect power to tax, including any city,
county, state or federal government, or any school, agricultural, sanitary,
fire, street, drainage or other improvement district thereof, as against any
legal or equitable interest of Lessor in the Industrial Center or in any portion
thereof, as against Lessor's right to rent or other income therefrom, and as
against Lessor's business of leasing the Industrial Center. The term "real
property tax" shall also include any tax, fee, levy, assessment or charge (i) in
substitution of, partially of totally, any tax, fee, levy, assessment or charge
herein above included within the definition of "real property tax," or (ii) the
nature of which was hereinbefore included within the definition of "real
property tax," or (iii) which is imposed for a service or right not charged
prior to June 1, 1978, or, if previously charged, has been increased since June
1, 1978, or (iv) which is imposed as a result of a transfer, either partial or
total of Lessor's interest in the Industrial Center or which is added to a tax
or charge hereinbefore included within the definition of real property tax by
reason of such transfer, or (v) which is imposed by reason of this transaction,
any modifications or changes hereto, or any transfers hereof.
10.4 Joint Assessment. If the Industrial Center is not separately assessed,
Lessee's Share of the real property tax liability shall be an equitable
proportion of the real property taxes for all of the land and improvements
included within the tax parcel assessed, such proportion to be determined by
Lessor from the respective valuations assigned in the assessor's work sheets of
such other information as may be reasonably available. Lessor's reasonable
determination thereof, in good faith, shall be conclusive.
10.5 Personal Property Taxes. (a) Lessee shall pay prior to delinquency all
taxes assessed against and levied upon trade fixtures, furnishings, equipment
and all other personal property of Lessee contained in the Premises or
elsewhere. When possible, Lessee shall cause said trade fixtures, furnishings,
equipment and all other personal property to be assessed and billed separately
from the real property of Lessor. (b) If any of Lessee's said personal property
shall be assessed with Lessor's real property, Lessee shall pay to Lessor the
taxes attributable to Lessee within ten (10) days after receipt of a written
statement setting forth the taxes applicable to Lessee's property.
11. Utilities. Lessee shall pay for all water, gas, heat, light, power,
telephone and other utilities and services supplied to the Premises, together
with any taxes thereon. If any such services are not separately metered to the
Premises, Lessee Shall pay at Lessor's option, either Lessee's share or a
reasonable proportion to be determined by Lessor of all charges jointly metered
with other premises in the Building.
12. Assignment and Subletting. See Paragraph 52.
12.1 Lessor's Consent Required. Lessee shall not voluntarily or by operation
of law assign, transfer, mortgage, sublet, or otherwise transfer or encumber all
or any part of Lessee's interest in the Lease or in the Premises, without
Lessor's prior written Consent, which Lessor shall not unreasonably withhold.
Lessor shall respond to Lessee's request for consent hereunder in a timely
manner and any attempted assignment, transfer, mortgage, encumbrance or
subletting without such consent shall be void, and shall constitute a noncurable
breach of this Lease without the need for notice to Lessee under Paragraph 13.1.
12.2 Lessee Affiliate. Notwithstanding the provisions of paragraph 12.1
hereof, Lessee may assign or sublet the Premises, or any portion thereof,
without Lessor's consent, to any corporation which controls, is controlled by or
is under common control with Lessee, or to any corporation resulting from the
merger or consolidation with Lessee, or to any person or entity which acquires
all the assets of Lessee as a going concern of the business that is being
conducted on the Premises, all of which are referred to as "Lessee Affiliate,"
provided that before-such assignment shall be effective said assignee shall
assume, in full, the obligations of Lessee under this Lease. Any such assignment
shall not, in any way, affect or limit the liability of Lessee under the terms
of this Lease even if after such assignment or subletting the terms of this
Lease are materially changed or altered without the consent of Lessee, the
consent of whom shall not be necessary.
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12.3 Terms and Conditions of Assignment. Regardless of Lessor's consent, no
assignment shall release Lessee of Lessee's obligations hereunder or alter the
primary liability of Lessee to pay the Base Rent and Lessee's Share of Operating
Expenses, and to perform all other obligations to be performed by Lessee
hereunder. Lessor may accept rent from any person other than Lessee pending
approval or disapproval of such assignment. Neither a delay in the approval or
disapproval of such assignment nor the acceptance of rent shall constitute a
waiver or estoppel of Lessor's right to exercise its remedies for the breach of
any of the terms or conditions of this Paragraph 12 or this Lease. Consent to
one assignment shall not be deemed consent to any subsequent assignment. In the
event of default by any assignee of Lessee or any successor of Lessee, in the
performance of any of the terms hereof, Lessor may proceed directly against
Lessee without the necessity of exhausting remedies against said assignee.
Lessor may consent to subsequent assignments of this Lease or amendments or
modifications to this Lease with assignees of Lessee, without notifying Lessee,
or any successor of Lessee, and without obtaining its or their consent thereto
and such action shall not relieve Lessee of liability under this Lease.
12.4 Terms and Conditions Applicable to Subletting. Regardless of Lessor's
consent, the following terms and conditions shall apply to any subletting by
Lessee of all or any part of the Premises and shall be included in subleases:
(a) Lessee hereby assigns and transfers to Lessor all of Lessee's
interest in all rentals and income arising from any sublease heretofore or
hereafter made by Lessee, and Lessor may collect such rent and income and apply
same toward Lessee's obligations under this Lease, provided, to however, that
until a default shall occur in the performance of Lessee's obligations under
this Lease, Lessee may subject to Paragraph 52.1(e) receive collect and enjoy
the rents accruing under such sublease. Lessor shall not, by reason of this or
any other assignment of such sublessee to Lessor nor by reason of the collection
of the rents from a sublessee, be deemed liable to the sublessee for any failure
of Lessee to perform and comply with any of Lessee's obligations to such
sublessee under such sublease. Lessee hereby irrevocably authorizes and directs
any such sublessee, upon receipt of a written notice from Lessor stating that a
default exists in the performance of Lessee's obligations under this Lease, to
pay to Lessor the rents due and to become due under the sublease. Lessee agrees
that such sublessee shall have the right to rely upon any such statement and
request from Lessor, and that such sublessee shall pay such rents to Lessor
without any obligation or right to inquire as to whether such default exists and
notwithstanding any notice from or claim from Lessee to the contrary. Lessee
shall have no right or claim against such sublessee or Lessor for any such rents
so paid by said sublessee to Lessor.
(b) No sublease entered into by Lessee shall be effective unless and
until it has been approved in writing by Lessor. In entering into any sublease,
Lessee shall use only such form of sublease as is satisfactory to Lessor, and
once approved by Lessor, such sublease shall not be changed or modified without
Lessor's prior written consent. Any sublessee shall, by reason of entering into
a sublease under this Lease, be deemed, for the benefit of Lessor, to have
assumed and agreed to conform and comply with each and every obligation herein
to be performed by Lessee other than such obligations as are contrary to or
inconsistent with provisions contained in a sublease to which Lessor has
expressly consented in writing.
(c) If Lessee's obligations under this Lease have been guaranteed by
third parties, then a sublease, and Lessor's consent thereto, shall not be
effective unless said guarantors give their written consent to such sublease and
the terms thereof.
(d) The consent by Lessor to any subletting shall not release Lessee
from its obligations or alter the primary liability of Lessee to pay the rent
and perform and comply with all of the obligations of Lessee to be performed
under this Lease.
(e) The consent by Lessor to any subletting shall not constitute a
consent to any subsequent subletting by Lessee or to any assignment or
subletting by the sublessee. However, Lessor may consent to subsequent
sublettings and assignments of the sublease or any amendments or modifications
thereto without notifying Lessee or anyone else liable on the Lease or sublease
and without obtaining their consent and such action shall not relieve such
persons from liability.
(f) In the event of any default under this Lease, Lessor may proceed
directly against Lessee, any guarantors or anyone else responsible for the
performance of this Lease, including the sublessee, without first exhausting
Lessor's remedies against any other person or entity responsible therefor to
Lessor, or any security held by Lessor or Lessee.
(g) In the event Lessee shall default in the performance of its
obligations under this Lease, Lessor, at its option and without any obligation
to do so, may require any sublessee to attorn to Lessor, in which event Lessor
shall undertake the obligations of Lessee under such sublease from the time of
the exercise of said option to the termination of such sublease; provided,
however, Lessor shall not be liable for any prepaid rents or security deposit
paid by such sublessee to Lessee or for any other prior defaults of Lessee under
such sublease.
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(h) Each and every consent required of Lessee under a sublease shall
also require the consent of Lessor.
(i) No sublessee shall further assign or sublet all or any part of the
Premises without Lessor's prior written consent.
(j) Lessor's written consent to any subletting of the Premises by
Lessee shall not constitute an acknowledgment that no default then exists under
this Lease of the obligations to be performed by Lessee nor shall such consent
be deemed a waiver of any then existing default, except as may be otherwise
stated by Lessor at the time.
(k) With respect to any subletting to which Lessor has consented,
Lessor agrees to deliver a copy of any notice of default by Lessee to the
sublessee. Such sublessee shall have the right to cure a default of Lessee
within ten (10) days after service of said notice of default upon such
sublessee, and the sublessee shall have a right of reimbursement and offset from
and against Lessee for any such defaults cured by the sublessee.
12.5 Attorney's Fees. In the event Lessee shall assign or sublet the Premises
or request the consent of Lessor to any assignment or subletting or if Lessee
shall request the consent of Lessor for any act Lessee proposes to do then
Lessee shall pay Lessor's reasonable attorney's and/or consultant's fees
incurred in connection therewith, such attorneys fees not to exceed $350.00 for
each such request.
13. Default; Remedies.
13.1 Default. The occurrence of any one or more of the following events
shall constitute a material default of this Lease by Lessee:
(a) The vacating or abandonment of the Premises by Lessee.
(b) The failure by Lessee to make any payment of rent or any other
payment required to be made by Lessee hereunder, as and when due, where such
failure shall continue for a period of five (5) days after written notice
thereof from Lessor to Lessee. In the event that Lessor serves Lessee with a
Notice to Pay Rent or Quit pursuant to applicable Unlawful Detainer statutes
such Notice to Pay Rent or Quit shall also constitute the notice required by
this subparagraph.
(c) Except as otherwise provided in this Lease, the failure by Lessee
to observe or perform any of the covenants, conditions or provisions of this
Lease to be observed or performed by Lessee, other than described in paragraph
(b) above, where such failure shall continue for a period of thirty (30) days
after written notice thereof from Lessor to Lessee; provided, however, that if
the nature of Lessee's noncompliance is such that more than thirty (30) days are
reasonably required for its cure, then Lessee shall not be deemed to be in
default if Lessee commenced such cure within said thirty (30) day period and
thereafter diligently prosecutes such cure to completion. To the extent
permitted by law, such thirty (30) day notice shall constitute the sole and
exclusive notice required to be given to Lessee under applicable Unlawful
Detainer statutes.
(d) (i) The making by Lessee of any general arrangement or general
assignment for the benefit of creditors: (ii) Lessee becomes a "debtor" as
defined in 11 U.S.C. Section 101 or any successor statute thereto (unless, in
the case of a petition filed against Lessee, the same is dismissed within sixty
(60) days); (iii) the appointment of a trustee or receiver to take possession of
substantially all of Lessee's assets located at the Premises or of Lessee's
interest in this Lease, where possession is not restored to Lessee within thirty
(30) days; or (iv) the attachment, execution or other judicial seizure of
substantially all of Lessee's assets located at the Premises or of Lessee's
interest in this Lease, where such seizure is not discharged within thirty (30)
days. In the event that any provision of this paragraph 13.1 (d) is contrary to
any applicable law, such provision shall be of no force or effect.
(e) The discovery by Lessor that any financial statement given to
Lessor by Lessee, any assignee of Lessee, any subtenant of Lessee, any successor
in interest of Lessee or any guarantor of Lessee's obligation hereunder, was
materially false.
l3.3 Default by Lessor. Lessor shall not be in default unless Lessor fails to
perform obligations required of Lessor within a reasonable time, but in no event
later than thirty (30) days after written notice by Lessee to Lessor and to the
holder of any first mortgage or deed of trust covering the Premises whose name
and address shall have theretofore been furnished to Lessee in writing,
specifying wherein Lessor has failed to perform such obligation; provided,
however, that if the nature of Lessor's obligation is such that more than thirty
(30) days are required for performance then Lessor shall not be in default if
Lessor commences performance within such thirty (30) day period and thereafter
diligently prosecutes the same to completion.
13.4 Late Charges. Lessee hereby acknowledges that late payment by Lessee to
Lessor of Base Rent, Lessee=s Share of Operating Expenses or other sums due
hereunder will cause Lessor to incur costs not contemplated by this Lease, the
exact amount of which will be extremely difficult to ascertain. Such costs
include, but are not limited to, processing and accounting charges, and late
charges which may be imposed on Lessor by the terms of any mortgage or trust
deed covering the Property. Accordingly, if any installment of Base Rent,
Operating Expenses or any other sum due from Lessee shall not be received by
Lessor or Lessors designee within requirement for notice to Lessee. Lessee shall
pay to Lessor a late charge equal to 3% of such overdue amount. The parties
hereby agree that such late charge represents a fair and reasonable estimate of
the costs Lessor will incr by reason of late payment by Lessee. Acceptance of
such late charge by Lessor shall in no event constitute a waiver of Lessee's
default with respect to such overdue amount, nor prevent Lessor from exercising
any of the other rights and remedies granted hereunder. In the event that a
charge is payable hereunder, whether or not collected, for three (3) consecutive
installments of any of the aforesaid monetary obligations of Lessee then Base
Rent shall automatically become due and payable quarterly in advance, rather
than monthly, notwithstanding paragraph 4.1 or any other provision of this Lease
to the contrary.
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14. Condemnation. If the Premises or any portion thereof or the Industrial
Center are taken under the power of eminent domain, or sold under the threat of
the exercise of said power (all of which are herein called "condemnation"), this
Lease shall terminate as to the part so taken as of the date the condemning
authority takes title or possession, whichever first occurs. If more than ten
percent of the floor area of the Premises, or more than twenty-five percent of
that portion of the Common Areas designated as parking for the Industrial Center
is taken by condemnation, Lessee may, at Lessee's option, to be exercised in
writing only within ten (10) days after Lessor shall have given Lessee written
notice of such taking (or in the absence of such notice, within ten (10) days
after the condemning authority shall have taken possession) terminate this Lease
as of the date the condemning authority takes such possession. If Lessee does
not terminate this Lease in accordance with the foregoing, this Lease shall
remain in full force and effect as to the portion of the premises remaining,
except that the rent shall be reduced in the proportion that the floor area of
the Premises taken bears to the total floor area of the Premises. No reduction
of rent shall occur if the on ly area taken is that which does not have the
Premises located thereon. Any award for the taking of all or any part of the
Premises under the power of eminent domain or any payment made under threat of
the exercise of such power shall be the property of Lessor, whether such award
shall be made as compensation for diminution in value of the leasehold or for
the taking of the fee, or as severance damages; provided, however, that Lessee
shall be entitled to any award for loss of or damage to Lessee's trade fixtures
and removable personal property. In the event that this Lease is not terminated
by reason of such condemnation. Lessor shall to the extent of severance damages
received by Lessor in connection with such condemnation, repair any damage to
the Premises caused by such condemnation except to the extent that Lessee has
been reimbursed therefor by the condemning authority. Lessee shall pay any
amount in excess of such severance damages required to complete such repair.
16. Estoppel Certificate.
(a) Each party (as "responding party") shall at any time upon not less than
ten (10) days' prior written notice from the other party ("requesting party")
execute, acknowledge and deliver to the requesting party a statement in writing
(i) certifying that this Lease is unmodified and in full force and effect (or,
if modified, stating the nature of such modification and certifying that this
Lease, as so modified, is in full force and effect) and the date to which the
rent and other charges are paid in advance, if any, and (ii) acknowledging that
there are not, to the responding party's knowledge, any uncured defaults on the
part of the requesting party, or specifying such defaults if any are claimed.
Any such statement may be conclusively relied upon by any prospective purchaser
or encumbrancer of the Premises or of the business of the requesting party.
(b) At the requesting party's option, the failure to deliver such statement
within such time shall be a material default of this Lease by the party who is
to respond, without any further notice to such party, or it shall be conclusive
upon such party that (i) this Lease is in full force and effect, without
modification except as may be represented by the requesting party, (ii) there
are no uncured defaults in the requesting party's performance, and (iii) if
Lessor is the requesting party, not more than one month's rent has been paid in
advance.
(c) If Lessor desires to finance, refinance, or sell the Property, or any
part thereof, Lessee hereby agrees to deliver to any lender or purchaser
designated by Lessor such financial statements of Lessee as may be reasonably
required by such lender or purchaser. Such statements shall include the past
three (3) years' financial statements of Lessee. All such financial statements
shall be received by Lessor and such lender or purchaser in confidence and shall
be used only for the purposes herein set forth.
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17. Lessor's Liability. The term "Lessor" as used herein shall mean only the
owner or owners, at the time in question, of the fee title or a lessee's
interest in a ground lease of the Industrial Center, in the event of any
transfer of such title or interest. Lessor herein named (and in case of any
subsequent transfers then the grantor) shall be relieved from and after the date
of such transfer of all liability as respects Lessor's obligations thereafter to
be performed, provided that any funds in the hands of Lessor or the then grantor
at the time of such transfer, in which Lessee has an interest, shall be
delivered to the grantee. The obligations contained in this Lease to be
performed by Lessor shall, subject as aforesaid, be binding on Lessor's
successors and assigns, only during their respective periods of ownership.
18. Severability. The invalidity of any provision of this Lease as determined by
a court of competent jurisdiction, shall in no way affect the validity of any
other provision hereof.
19. Interest on Post-due Obligations. Except as expressly herein provided, any
amount due to Lessor not paid when due shall bear interest at then maximum rate
then allowable by law from the date due. Payment of such interest shall not
excuse or cure any default by Lessee under this Lease: provided, however, that
interest shall not be payable on late charges incurred by Lessee nor on any
amounts upon which late charges are paid by Lessee.
20. Time of Essence. Time is of the essence with respect to the obligations to
be performed under this Lease.
21. Additional Rent. All monetary obligations of Lessee to Lessor under the
terms of this Lease, including but not limited to Lessee's Share of Operating
Expenses and insurance and tax expenses payable shall be deemed to be rent.
22. Incorporation of Prior Agreements; Amendments. This Lease contains all
agreements of the parties with respect to any matter mentioned herein. No prior
or contemporaneous agreement or understanding pertaining to any such matter
shall be effective. This lease may be modified in writing only, signed by the
parties in interest at the time of the modification. Except as otherwise stated
in this Lease, Lessee hereby acknowledges that neither the real estate broker
listed in paragraph 54 hereof nor any cooperating broker on this transaction nor
the Lessor or any employee or Lessor or any employee or agents of any of said
persons has made any oral or written warranties or representations to Lessee
relative to the condition or use by Lessee of Premises or the Property and
Lessee acknowledges that Lessee assumes all responsibility regarding the
Occupational Safety Health Act, the legal use and adaptability of the Premises
and the compliance thereof with all applicable laws and regulations in effect
during the term of this Lease except as otherwise specifically stated in this
Lease.
23. Notices. Any notice required or permitted to be given here under shall be in
writing and maybe given by personal delivery or by certified mail, and if given
personally or by mail, shall be deemed sufficiently given if addressed to Lessee
or to Lessor at the address noted below the signature of the respective parties,
as the case may be, Either party may by notice to the other specify a different
address for notice purposes except that upon Lessee's taking possession of the
Premises, the Premises shall constitute Lessee's address for notice purposes. A
copy of all notices required or permitted to be given to Lessor hereunder shall
be concurrently transmitted to such party or parties at such addresses as Lessor
may from time to time hereafter designate by notice to Lessee.
24. Waivers. No waiver by Lessor of any provision hereof shall be deemed a
waiver of any other provision hereof or of any subsequent breach by Lessee of
the same or any other provision. Lessors consent to, or approval of, any act
shall not be deemed to render unnecessary the obtaining of Lessors consent to or
approval of any subsequent act by Lessee. The acceptance of rent hereunder by
Lessor shall not be a waiver of any preceding breach by Lessee of any provision
hereof, other than the failure of Lessee to pay the particular rent so accepted,
regardless of Lessors knowledge of such preceding breach at the time of
acceptance of such rent.
26. Holding Over. If Lessee, with Lessor's consent, remains in possession of the
Premises or any part thereof after the expiration of the term hereof, such
occupancy shall be a tenancy from month to month upon all the provisions of this
Lease pertaining to the obligations of Lessee, except that the monthly rent
shall be 150% of the rent payable in the last month of the lease term, but all
Options, if any, granted under the terms of this Lease shall be deemed
terminated and be of no further effect during said month to month tenancy.
27. Cumulative Remedies. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other remedies at
law or in equity.
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28. Covenants and Conditions. Each provision of this Lease performable by Lessee
shall be deemed both a covenant and a condition.
29. Binding Effect; Choice of Law. Subject to any provisions hereof restricting
assignment or subletting by Lessee and subject to the provisions of paragraph
17, this Lease shall bind the parties, their personal representatives,
successors and assigns. This Lease shall be governed by the laws of the State
where the Industrial Center is located and any litigation concerning this Lease
between the parties hereto shall be initiated in the county in which the
Industrial Center is located.
30. Subordination.
(a) This Lease, and any Option granted hereby, at Lessor's option, shall be
subordinate to any ground lease, mortgage, deed of trust, or any other
hypothecation or security now or hereafter placed upon the Industrial Center and
to any and all advances made on the security thereof and to all renewals,
modifications, consolidations, replacements and extensions thereof.
Notwithstanding such subordination, Lessee's right to quiet possession of the
Premises shall not be disturbed if Lessee is not in default and so long as
Lessee shall pay the rent and observe and perform all of the provisions of this
Lease, unless this Lease is otherwise terminated pursuant to its terms. If any
mortgages, trustee or ground lessor shall elect to have this Lease and any
Options granted hereby prior to the lien of its mortgage, deed of trust or
ground lease, and shall give written notice thereof to Lessee, this Lease and
such Options shall be deemed prior to such mortgage, deed of trust or ground
lease, whether this Lease or such Options are dated prior or subsequent to the
date of said mortgage, deed of trust or ground lease or the date of recording
thereof.
(b) Lessee agrees to execute any documents required to effectuate an
attornment, a subordination or to make this Lease or any Option granted herein
prior to the lien of any mortgage, deed of trust or ground lease, as the case
may be. Lessee's failure to execute such documents within ten (10) days after
written demand shall constitute a material default by Lessee hereunder without
further notice to Lessee or, at Lessor's option. Lessor shall execute such
documents on behalf of Lessee as Lessee's attorney-in-fact. Lessee does hereby
make, constitute and irrevocably appoint Lessor as Lessee's attorney-in-fact and
in Lessee's name, place and stead, to execute such documents in accordance with
this paragraph 30(b).
31. See Paragraph 56.
32. Lessor's Access. Lessor and Lessor's agents shall have the right to enter
the Premises at reasonable times for the purpose of inspecting the same, showing
the same to prospective purchasers, lenders, or lessees, and making such
alterations, repairs, improvements or additions to the Premises or to the
building of which they are part as Lessor may deem necessary or desirable.
Lessor may at any time place on or about the Premises or the Building any
ordinary "For Sale" signs and Lessor may at any time during the last 120 days of
the term hereof place on or about the Premises any ordinary "For Lease" signs.
All activities of Lessor pursuant to this paragraph shall be without abatement
of rent, nor shall Lessor have any liability to Lessee for the same.
33. Auctions. Lessee shall not conduct, nor permit to be conducted, either
voluntarily or involuntarily, any auction upon the Premises or the Common Areas
without first having obtained Lessor's prior written consent. Notwithstanding
anything to the contrary in this Lease. Lessor shall not be obligated to
exercise any standard of reasonableness in determining whether to grant such
consent.
34. Signs. Lessee shall not place any sign upon the Premises or the Industrial
Center without Lessor's prior written consent. Under no circumstances shall
Lessee place a sign on any roof of the Industrial Center.
35. Merger. The voluntary or other surrender of this Lease by Lessee, or a
mutual cancellation thereof, or a termination by Lessor, shall not work a
merger, and shall, at the option of Lessor, terminate all or any existing
subtenancies or may, at the option of Lessor, operate as an assignment to Lessor
of any or all of such subtenancies.
36. Consents. Except for paragraphs 33, 34, 59 and 60 hereof, wherever in this
Lease the consent of one party is required to an act of the other party such
consent shall not be unreasonably withheld or delayed.
-13-
37. Guarantor. In the event that there is a guarantor of this Lease, said
guarantor shall have the same obligations as Lessee under this Lease.
38. Quiet Possession. Upon Lessee paying the rent for the Premises and observing
and performing all of the covenants, conditions and provisions on Lessee's part
to be observed and performed hereunder, Lessee shall have quiet possession of
the Premises for the entire term hereof subject to all of the provisions of this
Lease and all covenants, conditions and restrictions of record. The individuals
executing this Lease on behalf of Lessor represent and warrant to Lessee that
they are fully authorized and legally capable of executing this Lease on behalf
of Lessor and that such execution is binding upon all parties holding ownership
interest in the Property.
39. Options.
39.1 Definition. As used in this paragraph the word "Option" has the
following meaning: (1) the right or option to extend the term of this Lease or
to renew this Lease or to extend or renew any lease that Lessee has on other
property of Lessor (2) the option or right of first refusal to lease the
Premises or the right of first offer to lease the Premises or the right of first
refusal to lease other space within the Industrial Center or other property of
Lessor or the right of first offer to lease other space within the Industrial
Center or other property of Lessor, (3) the right or option to purchase the
Premises or the Industrial Center, or the right of first refusal to purchase the
Premises or the Industrial Center, or the right of first offer to purchase the
Premises or the Industrial Center, or the right or option to purchase other
property of Lessor, or the right of first refusal to purchase other property of
Lessor or the right of first offer to purchase other property of Lessor.
39.2 Options Personal. Each Option granted to Lessee in this Lease is
personal to the original Lessee and may be exercised only by the original Lessee
while occupying the Premises who does so without the intent of thereafter
assigning this Lease or subletting the Premises or any portion thereof, and may
not be exercised or be assigned, voluntarily or involuntarily, by or to any
person or entity other than Lessee, provided, however, that an Option may be
exercised by or assigned to any Lessee Affiliate as defined in paragraph 12.2 of
this Lease. The Options, if any, herein granted to Lessee are not assignable
separate and apart from this Lease, nor may this Option be separated from this
Lease in any manner, either by reservation or otherwise.
39.3 Multiple Options. In the event that Lessee has any multiple options to
extend or renew this Lease a later option cannot be exercised unless the prior
option to extend or renew this Lease has been so exercised.
39.4 Effect of Default on Options.
(a) Lessee shall have no right to exercise an Option, notwithstanding any
provision in the grant of Option to the contrary, (i) during the time commencing
from the date Lessor gives to Lessee a notice of default pursuant to paragraph
13.1(b) or 13.1(c) and continuing until the noncompliance alleged in said notice
of default is cured, or (ii) during the period of time commencing on the date
after a monetary obligation to Lessor is due from Lessee and unpaid (without any
necessity for notice thereof to Lessee) and continuing until the obligation is
paid, or (iii) at any time after an event of default described in paragraphs
13.1(a), 13.1(d), or 13.1(a) (without any necessity of Lessor to give notice of
such default to Lessee), nor (iv) in the event that Lessor has given to Lessee
three or more notices of default under paragraph 13.1(b), or paragraph 13.1(c),
whether or not the defaults are cured, during the 12 month period of time
immediately prior to the time that Lessee attempts to exercise the subject
Option.
(b) The period of time within which an Option may be exercised shall not be
extended, or enlarged by reason of Lessee's inability to exercise an Option
because of the provisions of paragraph 39.4(a).
(c) All rights of Lessee under the provisions of an Option shall terminate
and be of no further force or effect, nothwithstanding Lessee's due and timely
exercise of the Option, if, after such exercise and during the term of this
Lease, (i) Lessee fails to pay to Lessor a monetary obligation of Lessee for a
period of thirty (30) days after such obligation becomes due (without any
necessity of Lessor to give notice thereof to Lessee), or (ii) Lessee fails to
commence to cure a default specified in paragraph 13.1(c) within thirty (30)
days after the date that Lessor gives notice to Lessee of such default and/or
Lessee fails thereafter to diligently prosecute said cure to completion, or
(iii) Lessee commits a default described in paragraph 13.1(a), 13.1(d) or
13.1(e) (without any necessity of Lessor to give notice of such default to
Lessee), or (iv) Lessor gives to Lessee three or more notices of default under
paragraph 13.1(b), or paragraph 13.1(c), whether or not the defaults are cured.
40. Security Measurres. Lessee hereby acknowledges that Lessor shall have no
obligation whatsoever to provide guard service or other security measures for
the benefit of the Premises or the Industrial Center. Lessee assumes all
responsibility for the protection of Lessee, its agents, and invitees and the
property of Lessee and of Lessee's agents and invitees from acts of third
parties. Nothing herein contained shall prevent Lessor, at Lessor's sole option,
from providing security protection for the Industrial Center or any part
thereof, in which event the cost thereof shall be included within the definition
of Operating Expenses, as set forth in paragraph 4.2(b).
-14-
41. Easements. Lessor reserves to itself the right, from time to time, to grant
such easements, rights and dedications that Lessor deems necessary or desirable,
and to cause the recordation of Parcel Maps and restrictions, so long as such
easements, rights, dedications, Maps and restrictions do not unreasonably
interfere with the use of the Premises by Lessee. Lessee shall sign any of the
aforementioned documents upon request of Lessor and failure to do so shall
constitute a material default of this Lease by Lessee without the need
for further notice to Lessee.
42. Performance Under Protest. If at anytime a dispute shall arise as to any
amount or sum of money to be paid by one party to the other under the provisions
hereof, the party against whom the obligation to pay the money is asserted shall
have the right to make payment "under protest" and such payment shall not be
regarded as a voluntary payment, and there shall survive the right on the part
of said party to institute suit for recovery of such sum. If it shall be
adjudged that there was no legal obligation on the part of said party to pay
such sum or any part thereof, said party shall be entitled to recover such sum
or so much thereof as it was not legally required to pay under the provisions of
this Lease.
43. Authority. If Lessee is a corporation, trust or general or limited
partnership, each individual executing this Lease on behalf of such entity
represents and warrants that he or she is duly authorized to execute and deliver
this Lease on behalf of said entity. If Lessee is a corporation, trust or
partnership, Lessee shall, within thirty (30) days after execution of this
Lease, deliver to Lessor evidence of such authority satisfactory to Lessor.
44. Conflict. Any conflict between the printed provisions of this Lease and the
typewritten or handwritten provisions, if any, shall be controlled by the
typewritten or handwritten provisions.
45. Offer. Preparation of this Lease by Lessor or Lessor's agent and submission
of some to Lessee shall not be deemed an offer to lease. This Lease shall become
binding upon Lessor and Lessor only when fully executedj by Lessor and Lessee.
46. Addendum. Attached hereto is an addendum or addenda containing paragraphs 47
through 66 which constitute a part of this Lease.
LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
PROVISION CONTAINED HEREIN AND, BY EXECUTION OF THIS LEASE, SHOW THEIR INFORMED
AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE TIME THIS
LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE AND
EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE
PREMISES.
THIS LEASE HAS BEEN PREPARED FOR SUBMISSION TO
YOUR ATTORNEY FOR APPROVAL. NO REPRESENTATION
OR RECOMMENDATION IS MADE BY THE AMERICAN
INDUSTRIAL REAL ESTATE ASSOCIATION OR BY THE
REAL ESTATE BROKER OR ITS AGENTS OR EMPLOYEES
AS TO THE LEGAL SUFFICIENCY, LEGAL EFFECT, OR
TAX CONSEQUENCES OF THIS LEASE OR THE
TRANSACTION RELATING THERETO; THE PARTIES
SHALL RELY SOLELY UPON THE ADVICE OF THEIR OWN
LEGAL COUNSEL AS TO THE LEGAL AND TAX
CONSEQUENCES OF THIS LEASE.
-15-
"LESSOR":
THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA
------------------------------------------------
By: Xxxxxxx & Xxxxxxxxx of California, Inc.
Its managing agent,
By:/s/ Xxxxxxx & Wakefield of California, Inc.
---------------------------------------------
By: ____________________________________________
Executed on ____________________________________
ADRESS FOR NOTICES AND RENT
(See Addendum)
-------------------------------------------------
"LESSEE":
WAWD-EAP AUTOMOTIVE PRODUCTS, INC.,
a Delaware corporation
-------------------------------------------------
By: /s/ WAWD-EAP Automotive Products, Inc.
---------------------------------------------
By: ---------------------------------------------
Executed on October 2, 1995
-------------------------------------
ADDRESS
(See Addendum)
-------------------------------------------------
-16-
ADDENDUM TO
STANDARD INDUSTRIAL LEASE
DATED AS OF AUGUST 31, 1995 BY AND BETWEEN
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA,
AS LESSOR AND
WAWD-EAP AUTOMOTIVE PRODUCTS INC.,
A DELAWARE CORPORATION,
AS LESSEE
47. Operating Expenses
47.1 The following are Operating Expenses within the meaning of paragraph
4.2: (a) the cost of Lessor's performing the maintenance obligations described
in paragraph 7.1, including replacements, (b) the cost of operating, repairing,
replacing and maintaining the Building, the roof, and any other utilities or
equipment, wherever situated, that are for the common use of the tenants of the
Building or Industrial Center, and (c) the cost of a Commercial General
Liability policy of insurance, insuring Lessor, but not Lessee, against
liability arising out of the ownership, use, occupancy or maintenance of the
Industrial Center, in amounts determined by Lessor, if Lessor determines to
obtain such insurance.
47.2 "Lessee's share" as set forth in paragraph 4.2(a) is Lessee's share of
Operating Expenses applicable only to the Building in which the Premises are
located. The percentage set forth in paragraph 4.2(a) has been determined by
dividing the approximate square footage of the Premises by the total approximate
square footage of rentable space contained in the Building. It is understood and
agreed that the square footage figure set forth in 4.2(a) is an approximation
which Lessor and Lessee agree is reasonable and shall not be subject to revision
except in connection with an actual change in the size of the Premises or a
change in the space available for lease in the Building.
47.3 Lessee's Share of Operating Expenses applicable to the Industrial
Center shall be reasonably determined by Lessor as the percentage created by
dividing the square footage of the Premises by the total square footage of the
Buildings in the Industrial Center that are involved in the item covered by the
particular expense.
-1-
47.4 Lessor and Lessee shall promptly adjust between them by appropriate
cash payment any balance determined to exist with respect to Lessee's Share of
Operating Expenses after the end of the calendar year in which this Lease
terminates, prorating for any partial year involved.
48. Condition of Premises Upon Termination; Additional Use Provisions.
48.1 Lessee shall maintain the Premises as provided in Paragraph 7.2 and in
accordance with the requirements of any covenants or restrictions as may from
time to time be applicable to the Premises. Lessee, in keeping the Premises in
good order, condition and repair, shall exercise and perform good maintenance
practices and any damage or deterioration shall not be deemed "ordinary wear and
tear" if the same could have been prevented by good maintenance practice.
Lessee's obligations shall include restorations, replacements or renewals when
necessary to keep the Premises and all improvements thereon or a part thereof in
good order, condition and state of repair. Notwithstanding anything contained in
the Lease to the contrary, Lessee shall make all repairs whatsoever on the
Premises necessitated by the negligence, misconduct or fault of Lessee, or its
agents, licensees or agents.
48.2 If the term of this Lease, as the same may be extended or renewed,
exceeds five (5) years, Lessor shall have the right to require Lessee to repaint
the interior of the improvements every four (4) to six (6) years, but not more
often that once every five (5) years, as reasonably necessary.
48.3 Notwithstanding anything to the contrary in paragraph 7.2 of this
Lease, upon termination of this Lease, Lessee shall leave all plumbing, heating
(including space heaters), air conditioning, electrical and mechanical systems,
on the Premises and in good condition and operating order, and Lessee shall upon
demand pay to Lessor that portion of the cost to restore such items to good
condition and operating order as may be reasonably allocable to Lessee' tenancy.
48.4 Notwithstanding anything to the contrary contained in the Lease, the
Premises shall not be used for the warehousing or distribution of hazardous or
explosive products, substances or materials, or of products, substances or
materials that are detrimental to the Premises, the Industrial Center or other
tenants thereof.
49. Alterations and Improvements.
-2-
49.1 Any alterations, improvements, additions, or Utility Installations made
by Lessee during the term of this Lease shall be done in a good and workmanlike
manner and of good and sufficient materials, and Lessee shall, within thirty
(30) days after completion of such alteration, improvements, addition or Utility
Installation, provide Lessor with as-built plans and specifications for same.
Notwithstanding anything contained in this Lease to the contrary, Paragraphs
49.2(a)(ii) and (iii) shall apply to non-structural alterations, improvements,
additions or Utility Installations not exceeding $2,500 in cost.
49.2 For any additions, alterations, improvements, or Utility Installations
requiring Lessor's prior written consent:
(a) Lessee shall:
(i) Request Lessor's approval in writing at least thirty (30) days
prior to proposed construction.
(ii) Employ a California licensed architect, contractor and
structural engineer in connection with the proposed construction
(iii) Be fully responsible for the acts of Lessee's consultants,
employees, contractors, subcontractors, invitees and agents, and cause them to
fully comply with any applicable terms of this Lease and documents referred to
by this Lease and all applicable laws, rules and regulations.
(iv) Enter into written agreements with an architect and general
contractor on standard American Institute of Architects (AIA) form or reasonable
equivalent for the contract itself as well as payment schedules, change orders,
etc. Copies of executed agreements will be forwarded to Lessor within five (5)
days of execution.
(v) Cause to be obtained an applicable building permit for any and
all construction and modifications, and construct the additions and alterations
and perform the construction work in accordance with all applicable laws,
including without limitation the Americans With Disabilities Act.
(b) Lessee's Architect Shall:
(i) Be licensed by the State of California.
(ii) Design and specify within the parameters of the building work
letter (if any) and approved building specifications (if any) or have received
specific written exceptions from Lessor.
-3-
(iii) Secure Lessor's written approval before submitting plans to
the general contractor for bidding or to governmental agencies for approval.
(iv) Secure Lessor's written approval of any changes or alternates
to the plans recommended by the general contractor or required by governmental
agencies.
(v) Submit a copy of the final application for permit and issued
permit to Lessor.
(vi) Incorporate the building standard details (if any) supplied by
Lessor onto the drawings.
(vii) Submit final plans for Lessor's written approval prior to
construction.
(viii) Be available for final inspection with Lessor at job
completion
(ix) Secure Lessor's written approval of details of any changes in
specifications or finishes during construction.
(x) Provide samples and specifications as required by Lessor
(xi) Sign off on the as-built drawings as the Architect's
certification that the improvements have, in fact, been built as per the
Architect's design.
(c) Lessee's General Contractor and/or Subcontractors Shall:
(i) Be licensed by the State of California.
(ii) Have substantial experience providing similar quality and
quantity of improvements. Work history shall be provided to Lessor prior to
being awarded contract.
(iii) Have a bonding capacity equal to or exceeding the valuation
of the job. Lessor may, at its sole option, require the job to be bonded.
Notwithstanding the foregoing, so long as the party named as Lessee on the
signature page of this Lease is the Lessee, Lessor agrees to
-4-
waive the requirement of a bond with respect to jobs having a cost of under
$50,000.
(iv) Maintain in full force and effect, through out the duration of
its performance under the contract with the Lessee, a Worker's Compensation
insurance policy and a Commercial General Liability insurance policy issued by
an insurer satisfactory to Lessor with liability coverage of not less than
$1,000,000.00 for personal injury and $500,000.00 to cover property damage. The
Commercial General Liability insurance policy shall include assumption of
contractual liability. Certificates of insurance containing a thirty (30) day
cancellation clause shall be furnished to Lessor prior to commencement of
performance under the construction contract naming Lessor (The Prudential
Insurance Company of America) and its managing agent (currently Xxxxxxx &
Xxxxxxxxx of California, Inc.) as additional insureds.
(v) Provide a construction schedule to Lessor prior to commencement
of work and weekly written progress reports.
(vi) Warrant the General Contractor's work and that of the General
Contractor's subcontractors, for a minimum of one (1) year.
(vii) Provide Lessor with as-built drawings of all improvements.
(d) All approvals by Lessor, as herein provided for, shall not be
unreasonably withheld. All requests to be submitted to Lessor shall be submitted
through Lessor's managing agent.
50. Insurance; Indemnity.
50.1 Lessee hereby agrees to indemnify, defend and hold harmless Lessor, its
successors, assigns, subsidiaries, directors, officers, agents and employees
from and against any and all damage, loss, liability or expense including, but
not limited to, attorney's fees and legal costs suffered by same directly or by
reason of any claim, suit or judgement brought by or in favor of any person or
persons for damage, loss or expense due to, but not limited to, bodily injury,
including death resulting anytime therefrom, and property damage sustained by
such person or persons which arises out of, is occasioned by or in any way
attributable to the use or occupancy of the Premises
-5-
by the Lessee, the acts or omission of the Lessee, its agents, employees or any
other contractors brought onto said Premises by the Lessee, or any breach or
default in the performance of any obligation on Lessee's part to be performed
under the terms of this Lease, except to the extent caused by the gross
negligence or wilful misconduct of Lessor, its employees, and agents. If any
action or proceeding is brought against Lessor by reason of any such claim,
Lessee, upon notice from Lessor (which as to any action or proceeding of which
Lessee does not have notice, shall be given within a reasonable time after
Lessor has actual knowledge of the action or proceeding), shall defend same at
Lessee's expense by counsel satisfactory to Lessor. Lessor's notice under the
preceding sentence shall in any event be deemed reasonable if Lessee's defense
of Lessor is not materially affected by any delay in Lessor's giving that
notice. Such loss or damage shall include, but not be limited to, any injury or
damage to Lessor's personnel (including death resulting anytime there from) on
the Premises. Lessor shall not be liable for any damages arising from any act or
neglect of any other tenant, if any, of the building or industrial park in which
the Premises are located. Lessee agrees that the obligations assumed herein
shall survive the termination of this Lease.
50.2 Lessee hereby agrees to maintain in full force and effect at all times
during the term of this Lease, at Lessee's own expense, for the protection of
Lessee, Lessor and Lessor's property manager, as their interest may appear,
policies of insurance issued by a responsible carrier or carriers to Lessor
which afford the following coverages:
(a) Worker's Compensation Statutory
Employer's Liability Not less than $100,000.00
Commercial General
Liability Not less than
$2,000,000.00 per
occurrence, $4,000,000
product and completed
operations aggregate, and
$4,000,000 general aggregate
(b) All risk coverage against loss, theft or damage with vandalism and
malicious mischief endorsements to cover Lessee's personal property, fixtures,
equipment, tenant improvements, alterations and Utility Installations in, on or
about the Premises in an amount of at least one hundred (100%) of their full
replacement value, with a deductible
-6-
not to exceed $10,000 per occurrence. The proceeds from any such policy shall be
used by Lessee for the replacement of personal property or the restoration of
Lessee's improvements, alterations, or Utility Installations unless the tenant
improvements or alterations have become part of the Premises under the terms of
this Lease.
The limits of said insurance in this Paragraph 50.2(a) shall not
however, limit the liability of Lessee hereunder.
50.3 Lessor shall obtain and keep in force the following insurance coverage:
(a) All risk property insurance, insuring the building of
which the Premises are a part, with earth quake, flood and agreed
amount endorsement. Lessor shall not be obligated to insure, and shall
not assume any liability or risk of loss for, any of Lessee's
furniture, equipment, machinery, goods, supplies, Utility
Installations, improvements, or alterations upon the Premises.
(b) Rent insurance covering those risks referred to in
Paragraph 50.2(b) in an amount equal to all that is called for under
Paragraph 4 of this Lease (Rent and any additional rents payable under
this Lease including tax and insurance costs), as the same may be
increased pursuant to the terms of this Lease, for a period of at least
twelve (12) months commencing with the date of loss.
(c) Boiler and machinery insurance in an amount satisfactory
to Lessor.
50.4 The Lessee shall deliver to Lessor prior to taking possession of the
Premises, and thereafter at least thirty (30) days prior to expiration of such
policy, certificates of insurance evidencing the above coverage with limits not
less than those specified above. Insurance required hereunder shall be in
companies holding a "General Policyholders Rating" of at least A-XII as set
forth in the most current issue of "Best's Insurance Guide". Such Certificates
with the exception of Worker's Compensation, shall name Lessor, its
subsidiaries, directors, agents and employees, and its property manager as
additional insureds and shall expressly provide that the interest of same herein
shall not be affected by a breach by Lessee of any insurance policy provision
for which such Certificates evidence coverage. Further, all Certificates shall
expressly provide that no less than thirty (30) days prior written notice shall
be given to Lessor in the event of material alteration to or cancellation of the
coverage evidenced by such Certificates.
-7-
50.5 Lessor may secure and maintain, at Lessee's expense, increased amounts
of insurance and other insurance coverage in such limits, as Lessor may require
in its reasonable judgment to afford Lessor adequate protection consistent: with
the practices of other institutional owners of comparable properties.
50.6 Lessor makes no representation that the limits of liability specified
to be carried by Lessee under the term of this Lease are adequate to protect
Lessee against Lessee's undertaking under this Paragraph 50 and in the event
Lessee believes that any such insurance coverage called for under this Lease is
insufficient, Lessee shall provide, at its own expense, such additional
insurance as Lessee deems adequate
50.7 Anything in this Lease to the contrary notwithstanding, Lessor and
Lessee hereby waive and release each other of and from any and all rights of
recovery, claims, action or cause of action, against each other, their agents,
officers and employees, for any loss or damage that may occur to the Premises,
improvements to the building of which the Premises are a part, personal property
(building contents) within the building on the Premises, any furniture,
equipment, machinery, goods or supplies not covered by this Lease which Lessee
may bring or obtain upon the Premises or any additional improvements which
Lessee may construct on the Premises, by reason of fire, the elements or any
other cause which could be insured against under the terms of all risk property
insurance policies, regardless of cause or origin, including negligence of
Lessor or Lessee and their agents, officers and employees. Because this
Paragraph will preclude the assignment of any claim mentioned in it by way of
subrogation (or otherwise) to an insurance company (or any other person) each
party to this Lease agrees immediately to give to each insurance company,
written notice of the terms of the mutual waivers contained in this Paragraph,
and to have the insurance policies properly endorsed if necessary to prevent the
invalidation of the insurance coverages by reason of the mutual waivers
contained in this Paragraph. Lessee also waives and releases Lessor, its agents,
officers and employees of and from any and all rights of recovery, claim, action
or cause of action for any loss or damage insured against under any other
policies of insurance carried by Lessee.
50.8 Payment of Premium Increase
(a) After the term of this Lease has commenced, Lessee shall not be
responsible for paying Lessee's Share of any increase in the property insurance
premium for the Industrial Center specified by Lessor's insurance carrier as
being caused by the use, acts or omissions of any other lessee of the Industrial
-8-
Center, or by the nature of such other lessee's occupancy which create an
extraordinary or unusual risk.
(b) Lessee, however, shall pay the entity of any increase in the
property insurance premium for the Industrial Center over what is was
immediately prior to the commencement of the term of this Lease if the increase
is specified by Lessor's insurance carrier as being caused by the nature of
Lessee's occupancy or any act or omission of Lessee.
50.9 In the event that Lessor shall be obligated to repair or restore the
Premises pursuant to Paragraph 9 of this Lease and shall not commence such
repair or restoration within ninety (90) days after such obligation shall
accrue, the right of Lessee to terminate this Lease pursuant to Paragraph 9.2(b)
of this Lease shall be the sole right and remedy of Lessee against Lessor, and
Lessor shall have no other liability to Lessee, for damages, specific
performance or otherwise, in connection with any such failure.
50.10 Self Insurance. Lessee may self-insure the requirement for the
insurance set forth in Paragraph 50.2(b); provided that such self-insurance
shall be treated as if Lessee actually carried a policy of such required
insurance. For example, the waiver of subrogation provisions set forth in
Paragraph 50.7 shall apply to such self-insurance.
51. Easements and Restrictions of Record.
51.1 Lessee accepts the Premises and Industrial Center subject to the
easements and covenants or restrictions of record.
51.2 Lessor and Lessee agree to cooperate and use their best efforts to
participate in traffic management programs generally applicable to businesses
located in the area which includes the Industrial Center and, initially, shall
encourage and support van and car pooling by Lessee's employees to the fullest
extent permitted by the requirements of lessee's business. Neither this
Paragraph nor any other provision in this Lease, however, is intended to or
shall create any rights or benefits in any other person, firm, company,
governmental entity or the public.
52. Additional Provisions Regarding Assignment and Subletting.
52.1 If at any time or from time to time during the term of this Lease,
Lessee desires to assign or sublet all or any part of Lessee's interest in this
Lease or in the Premises, Lessee shall give prior written notice to Lessor
setting forth the terms of
-9-
the proposed assignment or subletting and the space so proposed to be assigned
or sublet. Lessor shall have the option, exercisable by notice given to Lessee
within twenty (20) days after Lessee's notice is given, either to sublet from
Lessee such space at the rental and other terms set: forth in Lessee's notice,
or if the proposed subletting is for the entire Premises for the balance of the
term of the Lease, to terminate this Lease. If Lessor does not exercise such
option, Lessee shall be free to assign or sublet such space to any third party.
Such assignment or sublease shall be subject to, without limitation, all the
conditions in Paragraph 12 and the following conditions:
(a) The assignment or sublease shall be on the terms set forth
in the notice given to Lessor. Any subsequent changes or modifications
will require Lessor's prior written consent.
(b) Lessee acknowledges that Lessor's agreement to lease these
Premises to Lessee at the rent and terms stated herein is made in
material reliance upon Lessor's evaluation of this particular Lessee's
background, experience and ability, as well as the nature of the use of
the Premises by this Lessee as set forth in Paragraph 6. In the event
that Lessee shall request Lessor's written consent to assign or
sublease the Premises as required in Paragraphs 52.1 and 12.1 hereof,
then each such request for consent shall be accompanied by the
following:
(i) Financial statements of the proposed assignee or
sublessee,
(ii) A statement of the specific uses for which the
Premises will be utilized by the proposed assignee or sublessee; and
(iii) Preliminary plans prepared by an architect or civil
engineer for all alterations to the Premises that are contemplated to be made by
Lessee, the proposed assignee or sublessee.
(c) No assignment or sublease shall be valid and no assignee
or sublessee shall take possession of the Premises assigned or
subleased until an executed counter part of such assignment or sublease
has been delivered to Lessor.
(d) No sublessee or assignee shall have a right further to
sublet or assign.
(e) 100% (after deduction of reasonable real estate brokerage
commission paid by Lessee) of any sums or other
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economic consideration received by Lessee as a result of such assignment or
subletting (except rental or other payments received which are attributable to
amortization of the cost of leasehold improvements other than building standard
tenant improvements made to the assigned or sublet portion of the Premises by
Lessor) whether denominated rentals under the assignment or sublease or
otherwise which exceed, in the aggregate, the total sums which Lessee is
obligated to pay Lessor under this Lease (prorated to reflect obligations
allocable to that portion of the Premises subject to such assignment or
sublease) shall be payable to Lessor as additional rental under this Lease
without affecting or reducing any other obligation of Lessee hereunder. In the
event of subletting of only a portion of the Premises, in calculating whether
the rent received by Lessee exceeds the rent payable under this Lease, the rent
payable under the Lease shall be prorated according to the square footage
involved in order to reflect the rent applicable to the space sublet.
52.2 Lessees Other Than Individuals.
(a) If Lessee is a partnership, a transfer of any interest of a general
partner, a withdrawal of any general partner from the partnership, or the
dissolution of the partnership, shall be deemed to be an assignment of this
Lease.
(b) If Lessee is a corporation, unless Lessee is a public corporation whose
stock is regularly traded on a national stock exchange, or is regularly traded
in the over-the-counter market and quoted on NASDAQ, any sale or other transfer
of a percentage of capital stock of Lessee which results in a change of
controlling persons, or the sale or other transfer of substantially all of the
assets of Lessee, shall be deemed to be an assignment of this Lease
52.3 Attorney's Fees. Notwithstanding anything to the contrary in Paragraph
12.5, the parties agree that a payment of $750.00 is a reasonable fee for
Lessor's review of Lessee's request to assign or sublet.
53. Remedies.
The following is inserted as Paragraph 13.2 of the Lease in lieu of the
provision contained in the Printed form:
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13.2 Remedies. If Lessee fails to perform any affirmative duty or
obligation of Lessee under this Lease, within ten (10) days after written notice
to Lessee (or in case of an emergency, without notice), Lessor may at its option
(but without obligation to do so), perform such duty or obligation on Lessee's
behalf including but not limited to the obtaining of reasonably required bonds,
insurance policies, or govern mental licenses, permits or approvals. The costs
and expenses of any such performance by Lessor shall be due and payable by
Lessee to Lessor upon invoice therefor. In the event of a breach of this Lease
by Lessee, as defined in Paragraph 13.1, with or without further notice or
demand, and without limiting Lessor in the exercise of any right or remedy which
Lessor may have by reason of such breach, Lessor may:
(a) Terminate Lessee's right to possession of the Premises by
any lawful means, in which case this Lease and the term hereof shall
terminate and Lessee shall immediately surrender possession of the
Premises to Lessor. In such event Lessor shall be entitled to recover
from Lessee: (i) the worth at the time of the award of the unpaid rent
which had been earned at the time of termination; (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 the Lessee proves could have been
reasonably avoided, (iii) the worth at the time of award of the amount
by which the unpaid rent for the balance of the term after the time of
award exceeds the amount of such rental loss that the Lessee proves
could be reasonably avoided,; and (iv) any other amount necessary to
compensate Lessor for all the detriment proximately caused by the
Lessee's failure to perform its obligations under this Lease or which
in the ordinary course of things would be likely to result therefrom,
including but not limited to the cost of recovering possession of the
Premises, expenses of reletting, including necessary renovation and
alteration of the Premises, reasonable attorneys' fees, and that
portion of the leasing commission paid by Lessor applicable to the
unexpired term of this Lease. The worth of the time of award of the
amount referred to in provisions (i) and (ii) of the prior sentence
shall be calculated based on an interest rate equal to the highest rate
permitted by applicable law. The worth at the time of award of the
amount referred to in provision (iii) of the prior sentence 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.
Efforts by Lessor to mitigate damages caused by Lessee's breach of this
Lease shall not waive Lessor's right to recover damages
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under this Paragraph. If termination of this Lease is obtained through
the provisional remedy of unlawful detainer, Lessor shall have the
right to recover in such proceeding the unpaid rent and damages as are
recoverable therein, or Lessor may reserve therein the right to recover
all or any part thereof in a separate suit for such rent and/or
damages. If a notice and grace period required under subparagraphs
13.1(b), (c) or (d) was not previously given, a notice to pay rent or
quit, or to perform or quit, as the case may be, given to Lessee under
any statute authorizing the forfeiture of leases for unlawful detainer
shall also constitute the applicable notice for grace period purposes
required by subparagraphs 13.1(b), (c) or (d). In such case, the
applicable grace period under subparagraphs 13.1(b), (c) or (d) and
under the unlawful detainer statute shall run concurrently after the
one such statutory notice, and the failure of Lessee to cure the
default within the greater of the two such grace periods shall
constitute both an unlawful detainer and breach of this Lease entitling
Lessor to the remedies provided for in this Lease and/or by said
statute.
(b) Continue the Lease and Lessee's right to possession in
effect (in California under California Civil Code Section 1951.4) after
Lessee's breach and abandonment and recover the rent as it becomes due,
provided Lessee has the right to sublet or assign, subject only to
reasonable limitations. See Paragraphs 12, 36 and 52 for the
limitations on assignment and subletting which limitations Lessee and
Lessor agree are reasonable. Acts of maintenance or preservation,
efforts to relet the Premises, or the appointment of a receiver to
protect the Lessor's interest under the Lease, shall not constitute a
termination of the Lessee's right to possession.
(c) Pursue any other remedy now or hereafter available to
Lessor under the laws or judicial decisions of the State of California.
Unpaid installments of rent and other unpaid monetary obligations of
Lessee under the terms of this Lease shall bear interest from the date
due at the maximum rate allowed by law.
(d) The expiration or termination of this Lease and/or the
termination of Lessee's right to possession shall not relieve Lessee
from liability under any indemnity provisions of this Lease as to
matters occurring or accruing during the term hereof or by reason of
Lessee's occupancy of the Premises.
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54. Broker's Commissions.
Lessee and Lessor each represent and warrant to the other that neither
has had any dealings with any person, firm, broker or finder (other than those
persons, if any, whose names are set forth at the end of this paragraph 54) in
connection with the negotiation of this Lease and/or the consummation of the
transaction contemplated hereby, and no other broker or other person, firm or
entity is entitled to any commission or finder's fee in connection with said
transaction and Lessee and Lessor do each hereby indemnify and hold the other
harmless from and against any costs, expenses, attorneys' fees or liability for
compensation, commission or charges which may be claimed by any such unnamed
broker, finder or other similar party by reason of any dealings or actions of
the indemnifying party. Named brokers:
Lessor's Broker: None
Lessee's Broker: None
55. Notices.
Any notice given pursuant to this Lease shall be personally delivered,
delivered by Federal Express or comparable overnight courier, providing written
evidence of delivery, or delivered by U.S. registered or certified mail, return
receipt requested, postage prepaid and sent to Lessor and Lessee at the
following addresses:
LESSOR:
The Prudential Realty Group
0000 Xxxxxxx Xxxx Xxxx
Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Regional Counsel
With a copy by the same method to:
Xxxxxxx & Xxxxxxxxx of California, Inc.
000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attn: Xxxx Xxxxxxxx
LESSEE:
WAWD-EAP Automotive Products, Inc.
0000 Xxxx 00xx Xxxxxx
Xxxxxx, Xxxxxxxxxx 00000
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With a copy by the same method to:
Echlin Inc.
000 Xxxxxx Xxxxx Xxxx
Xxxxxxxx, XX 00000
Attn: Corporate Secretary
or such other address as either party may from time to time designate as its
notice address by notifying the other party thereof. Notice so sent shall be
deemed given (a) when personally delivered, or (b) on the first business day
following deposit with Federal Express or a comparable overnight courier service
providing written evidence of delivery, or (c) five business days following
deposit in the United States mail, if notice is sent by registered or certified
mail, return receipt requested, postage prepaid.
56. Attorneys Fees.
56.1 If either party brings an action or proceeding to enforce the
terms hereof or declare rights hereunder, the prevailing party in any such
proceeding, action, or appeal thereon, shall be entitled to his reasonable
attorney's fees and such fees as may be awarded in the same suit or recovered in
a separate suit, whether or not such action or proceeding is pursued to decision
or judgement. The term, "prevailing party" shall include, without limitation, a
party who obtains legal counsel or brings an action against the other by reason
of the other's breach or default, or who defends such action, and substantially
obtains or defeats the relief sought, whether by compromise, settlement,
judgment, or abandonment of the claim or defense by the other party.
56.2 The attorney's fee award shall not be computed in accordance with
any court fee schedule, but shall be such as to fully reimburse all attorney's
fees reasonably incurred in good faith.
56.3 Lessor shall be entitled to attorney's fees, costs and expenses
incurred in the preparation and service of notices of default and consultations
in connection therewith, whether or not a legal action is subsequently commenced
in connection with such default. Lessor and Lessee agree that $350.00 is a
reasonable sum per occurrence for legal services and costs per preparation and
service of a notice of default and that Lessor may include $350.O0 as additional
rent due in each such notice of default as an amount that must be paid to cure
said default.
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57. Cashiers Checks.
57.1 In the event that any check given to Lessor by Lessee shall not be
honored by the bank upon which it is drawn on two or more occasions, then
Lessor, at its option may require all future payments to be made by Lessee under
this Lease to be made by Cashier's Checks.
57.2 Any payment made by Lessee pursuant to a written notice to pay or
be deemed in default under this Lease shall be made by Cashier's Check.
58. Amendments to Lease.
58.1 At such times as a rental adjustment is made to this Lease by
virtue of any provision of this Lease, the parties shall execute a written
amendment to this Lease to reflect said change.
58.2 Lessee agrees to make any non-monetary modifications to this Lease
that may be required by an institutional mortgagee of Lessor.
59. Storage Tanks.
59.1 Notwithstanding anything to the contrary in Paragraph 7.3 hereof,
Lessee shall not install storage tanks of any size or shape in the Premises,
above or below ground, with out the consent of the Lessor which can be withheld
in Lessor's sole discretion. If Lessor elects to grant its consent, Lessor shall
have the right to condition its consent upon Lessee agreeing to give to Lessor
such assurances that Lessor, in its sole discretion, deems necessary to protect
itself against potential problems concerning the installation, use, removal and
contamination of the Premises as a result of, the installation and/or use of
such tank, including but not limited to the installation of a concrete
encasement for said tank. Lessee shall comply at its expense with all applicable
permit and/or registration requirements and repair any damage caused by the
installation, maintenance or removal of such tank. Upon termination of the
Lease, Lessee shall, at its sole cost and expense, remove any tank from the
Premises, remove and replace any contaminated soil or materials (and compact or
treat the same as then required by law) and repair any damage or change to the
Premises caused by said installation and/or removal. Nothing contained herein
shall be construed to diminish or reduce Lessee's obligations under Paragraph
60.
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59.2 Lessor shall have the right to employ experts and/or consultants, at
Lessee's expense, to advise Lessor with respect to the installation, operation,
monitoring, maintenance and removal and restoration of any such tank.
60. Hazardous Materials.
60.1 Lessee's Covenants Regarding Hazardous Materials.
(a) Lessor's Prior Consent. Notwithstanding anything contained in this
Lease to the contrary, Lessee has not caused or permitted, and shall not cause
or permit any "Hazardous Materials" (as defined in subparagraph (b) below) to be
brought upon, kept, stored, discharged, released or used in, under or about the
Premises by Lessee, its agents, employees, contractors, subcontractors,
licensees or invitees, unless (1) such Hazardous Materials are reasonably
necessary to Lessee's business and will be handled, used, kept, stored and
disposed of in a manner which complies with all "Hazardous Materials Laws" (as
defined in subparagraph (b) below); (2) Lessee will comply with such other rules
or requirements as Lessor may from time to time impose, including without
limitation that (i) such materials are in small quantities, properly labeled and
contained, (ii) such materials are handled and disposed of in accordance with
the highest accepted industry standards for safety, storage, use and disposal,
(iii) such materials are for use in the ordinary course of business (i.e., as
with office or cleaning supplies), (3) notice of and a copy of the current
material safety data sheet is provided to Lessor for each such Hazardous
Material, and (4) Lessor shall have granted its prior written consent to the use
of such Hazardous Materials. Lessee hereby consents to the handling and storage
by Lessee of asbestos containing brake friction parts and of the Hazardous
Materials described in Schedule 1 hereto, subject to Lessee's compliance with
the terms and conditions of this Lease.
(b) Compliance with Hazardous Materials Laws. As used herein, the term
"Hazardous Materials" means any (1) oil, petroleum, petroleum products,
flammable substances, explosives, radioactive materials, hazardous wastes or
substances, toxic wastes or substances or any other wastes, materials or
pollutants which (i) pose a hazard to the Premises or to persons on or about the
Premises or (ii) cause the Premises to be in violation of any Hazardous
Materials Laws (as hereinafter defined): (2) asbestos in any form, urea
formaldehyde foam insulation, transformers or
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other equipment which contain dielectric fluid containing levels of
polychlorinated biphenyls, or radon gas; (3) chemical, material or substance
defined as or included in the definition of "hazardous substances," "hazardous
wastes," "hazardous materials," "extremely hazardous waste," "restricted
hazardous waste," or "toxic substances" or words of similar import under any
applicable local, state or federal law or under the regulations adopted or
publications promulgated pursuant thereto, including, but not limited to, the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended, 42 U.S.C. Section 9601, et seq.; the Resources Conservation Recovery
Act, 42 U.S.C. Section 6901, et seq.; the Hazardous Materials Transportation
Act, as amended, 49 U.S.C. Section 1801, et seq.; the Federal Water Pollution
Control Act, as amended, 33 U.S.C. Section 1251, et seq.; Sections 25115,
25117, 25122.7, 25140, 25249.8 25281, 25316 and 25501 of the California Health
and Safety Code; and Article 9 or Article 11 of Title 22 of the California Code
of Regulations, Division 4, Chapter 20; (4) other chemical, material or
substance, exposure to which is prohibited, limited or regulated by any
governmental authority or may or could pose a hazard to the health and safety of
the occupants of the Premises or the owners and/or occupants of property
adjacent to or surrounding the Premises, or any other Person coming upon the
Premises or adjacent property; and (5) other chemical, materials or substance
which may or could pose a hazard to the environment. As used here the term
"Hazardous Materials Laws" means any federal, state or local laws, ordinances,
regulations or policies relating to the environment, health and safety, and
Hazardous Materials (including, without limitation, the use, handling,
transportation, production, disposal, discharge or storage thereof) or to
industrial hygiene or the environmental conditions on, under or about the
Premises, including, without limitation, soil, groundwater and indoor and
ambient air conditions. Lessee shall at all times and in all respects comply
with all Hazardous Materials Laws.
(c) Hazardous Materials Removal. Upon expiration or earlier
termination of this Lease, Lessee shall, at Lessee's sole cost and expense,
cause all Hazardous Materials brought on the Premises with Lessor's consent to
be removed from the Premises in compliance with all applicable Hazardous
Materials Laws. If Lessee or its employees, agents, or contractors violates the
provisions of the foregoing two paragraphs, or if Lessee's acts, negligence, or
business operations contaminate, or expand the scope of contamination of, the
Leased Premises from such Hazardous Materials, then
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Lessee shall promptly, at Lessee's expense, take all investigatory and/or
remedial action (collectively, the "Remediation") that is necessary in order to
clean up, remove and dispose of such Hazardous Materials causing the violation
on the Leased Premises or the underlying groundwater or the properties adjacent
to the Leased Premises to the extent such contamination was caused by Lessee, in
compliance with all applicable Hazardous Materials Laws. Lessee shall further
repair any damage to the Leased Premises caused by the Hazardous Materials
contamination. Lessee shall provide prior written notice to Lessor of such
Remediation, and Lessee shall commence such Remediation no later than thirty
(30) days after such notice to Lessor and diligently and continuously complete
such Remediation. Such written notice shall also include Lessee's method, time
and procedure for such Remediation and Lessor shall have the right to require
reasonable changes in such method, time or procedure of the Remediation. Lessee
shall not take any Remediation in response to the presence of any Hazardous
Materials in or about the Premises or enter into any settlement agreement,
consent decree or other compromise in respect to any claims relating to any
Hazardous Materials in any way connected with the Premises, without first
notifying Lessor of Lessee's intention to do so and affording Lessor ample
opportunity to appear, intervene or otherwise appropriately assert and protect
Lessor's interests with respect thereto.
(d) Notices. Lessee shall immediately notify Lessor in writing of: (i)
any enforcement, cleanup, removal or other governmental or regulatory action
threatened, instituted, or completed pursuant to any Hazardous Materials Laws
with respect to the Premises; (ii) any claim, demand, or complaint made or
threatened by any person against Lessee or the Premises relating to damage,
contribution, cost recovery compensation, loss or injury resulting from any
Hazardous Materials; and (iii) any reports made to any governmental authority
arising out of any Hazardous Materials on or removed from the Premises. Lessor
shall have the right (but not the obligation) to join and participate, as a
party, in any legal proceedings or actions affecting the Premises initiated in
connection with any Hazardous Materials Laws
60.2 Indemnification of Lessor. Lessee shall indemnify, protect, defend
and forever hold Lessor harmless from any and all damages, losses, expenses,
liabilities, obligations and costs arising out of any failure of Lessee to
observe the foregoing covenants.
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61. Lessor's Default.
Any damages or judgments arising out of Lessor's default of its
obligations under this Lease shall be satisfied only out of Lessor's interest
and estate in the Premises, and Lessor shall have no personal liability beyond
such interest and estate with respect to such damages or judgments.
62. Rent Escalations - Initial Term.
(a) On the first day of each of the 31st and 61st months of the term
of this Lease, the monthly Base Rent payable under Paragraph 4 of the attached
Lease shall be adjusted by the increase, if any, from the date this Lease
commenced, in the Consumer Price Index of the Bureau of Labor Statistics of the
U.S. Department of Labor for Urban Wage Earners and Clerical Workers, Los
Angeles Anaheim-Riverside, California (1982-84=100), "All Items", herein
referred to as "C.P.I.".
(b) The monthly Base Rent payable in accordance with Paragraph (a)
above shall be calculated as follows: the Base Rent payable as set forth in
Paragraph 4 of the attached Lease, shall be multiplied by a fraction the
numerator of which shall be the C.P.I. of the calendar month during which the
adjustment is to take effect, and the denominator of which shall be the C.P.I.
for the calendar month in which the original Lease term commences. The sum so
calculated shall constitute the new monthly Base Rent hereunder, subject to
Subparagraph (e), below.
(c) Pending receipt of the required C.P.I. and determination of the
actual adjustment, Lessee shall pay an estimated adjusted rental, as reasonably
determined by Lessor by reference to the then available C.P.I. information. Upon
notification of the actual adjustment after publication of the required C.P.I.,
any overpayment shall be credited against the next installment of rent due, and
any underpayment shall be immediately due and payable by Lessee. Lessor's
failure to request payment of an estimated or actual rent adjustment shall not
constitute a waiver of the right to any adjustment provided for in the Lease or
this Paragraph 62.
(d) In the event the compilation and/or publication of the C.P.I.
shall be transferred to any other governmental department or bureau or agency or
shall be discontinued, then the index most nearly the same as the C.P.I. shall
be
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used to make such calculation. In the event that Lessor and Lessee cannot agree
on such alternative index, then the matter shall be submitted for decision to
the American Arbitration Association in accordance with the then rules of said
association and the decision of the Arbitrators shall be binding upon the
parties. The cost of said Arbitrators shall be paid equally by Lessor and
Lessee.
(e) The adjustment(s) required by this Rent Escalation Paragraph shall
be subject to the following additional agreements:
(i) The increase under Subparagraph (b), above, shall be subject
to the following minimum and maximum percentage increases per year
involved in the adjustment period, on a cumulative and compounded
basis:
Minimum yearly percentage increase: 3%
Maximum yearly percentage increase: 6%
The "adjustment period" is defined as the period commencing with the
month designated in SubParagraph (b) as the reference for determining
the "denominator", and ending with the month preceding the month
designated therein as the reference for determining the "numerator".
Should the adjustment period include a partial year, the minimum and
maximum percentages shall be prorated for that partial year by
multiplying them by a fraction, the numerator of which shall be the
number of full calendar months or major portion thereof contained in
said partial year, and the denominator of which is twelve (12).
(ii) The new monthly Base Rent shall in no event be less than the
rent in effect immediately preceding the rent adjustment.
63. Modification Improvements. Lessor shall construct and perform on the
Premises the following improvements and work (the "Modification Improvements")
in accordance with plans acceptable to Lessor:
63.1 Additional general office space as shown on Exhibit B hereto to
cause the total office space to be approximately 2,400 square feet.
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63.2 An ADA approved lift.
63.3 New demising wall as necessary to demise the Premises.
63.4 Demolish existing demising wall within Premises.
A portion of the Premises is currently occupied by an existing tenant (the
"Existing Tenant"). If Lessor has not substantially completed the Modification
Improvements by a date (the "Outside Date") that is the later of (a) February 1,
1996, or (b) 60 days after the date upon which the Existing Tenant vacates its
portion of the Premises, then rent under Lessee's existing lease (the "Old
Lease") in the Building shall be reduced to equal the rent that would be payable
under this Lease as if this Lease had commenced on the Outside Date. The Outside
Date shall be extended by one day for each day that Lessor's completion of the
Modification Improvements is delayed by the acts or omissions of Lessee.
64. Recovery of Concessions upon early Termination. In the event that Lessee's
right of possession of the Premises is terminated prior to the end of the
initial term by reason of default, legal process, abandonment, or any other
reason other than mutual agreement of the parties, then immediately upon such
termination, an amount shall be due and payable by Lessee to Lessor equal to the
unamortized portion as of that date (which amortization shall exclude any Option
Terms and shall be based on an interest rate of twelve percent (12%) per annum)
of the sum of (i) the cost of the Modification Improvements incurred by Lessor
as of that date by Lessor, and (ii) the amount of all commissions paid by Lessor
in order to procure this Lease.
65. Rail Spur. Lessor makes no representation or warranty to Lessee with respect
to the condition, fitness or suitability for Lessee's use of the rail spur
adjacent to the Premises. Lessee shall be solely responsible for all costs and
expenses incurred in connection with the use, maintenance, repair and operation
of the rail spur.
66. Number of Parking Spaces. Lessees shall have a pro rata share, based upon
building area, of the parking spaces in the Industrial Center.
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"LESSOR":
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
By: Xxxxxxx & Xxxxxxxxx of California, Inc.
its managing agent,
By: /s/Xxxxxxx & Wakefield of California, Inc.
------------------------------------------
------------------------------------------
[Printed Name and Title]
"LESSEE":
WAWD-EAP AUTOMOTIVE PRODUCTS, INC.,
a Delaware corporation
By:/s/ Xxxx X. Xxxx
---------------------------------------------
Xxxx X. Xxxx, Vice President/GM
---------------------------------------------
[Printed Name and Title]
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