STANDARD INDUSTRIAL/COMMERCIAL LEASE - NET
Exhibit
10.19
STANDARD
INDUSTRIAL/COMMERCIAL LEASE - NET
1. Basic Provisions ("Basic
Provisions")
1.1
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Parties: This Lease
("Lease"), dated
for reference purposes only August 28, 2008
, is made by and between FKC HIGHLAND LLC, a
Delaware limited liability company (“Landlord”) and
Fortunet, Inc.,
a Nevada corporation (“Tenant"),
(collectively the "Parties", or
individually a "Party").
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1.1.
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Premises: That certain
portion of the Project (as defined below), including all improvements
therein or to be provided by Landlord under the terms of this Lease,
commonly known by the street address of3000 Highland Drive,
Suite E,located in the
City ofLas
Vegas, State of Nevada ,
with zip code 89109-1063 , as
outlined on
Exhibit “A” attached hereto ("Premises") and
generally described as (describe briefly the nature of the Premises):
11,618 +/-
rentable square feet industrial / distribution space as part of a
multi-tenant industrial
park.
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1.2.
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In
addition to Tenant's rights to use and occupy the Premises as hereinafter
specified, Tenant shall have non-exclusive rights to the Common Areas (as
defined in Paragraph 2.7 below) as hereinafter specified, but shall not
have any rights to the roof, exterior walls or utility raceways of the
building containing the Premises ("Building") or to any
other buildings in the Project. The Premises, the Building, the Common
Areas, the land upon which they are located, along with all other
buildings and improvements thereon, are herein collectively referred to as
the "Industrial Project."
(See also Paragraph 2). Notwithstanding anything
contained in this Lease to the contrary, the parties hereto agree and
acknowledge that any statement of size, square footage, or dimension set
forth in this Lease or lease proposals that may have been used in
calculating rents or expense recoveries is a reasonable
approximation. All rents and/or expense recoveries based
thereon is not subject to revision or modification whether or not the
actual size is greater or less than stated
herein
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1.3.
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Parking: _____15_____("Unreserved Parking
Spaces"); and N/A reserved
vehicle parking spaces ("Reserved Parking
Spaces"). (See also Paragraph
2.6)
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1.4.
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Term:
60 (Lease
Months)
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Commencement Date: 10/1/2008
(“Commencement Date”)
Expiration Date: 9/30/2013
(“Expiration Date”)
1.5.
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Early Possession: N/A ("Early Possession
Date"). (See also Paragraphs 3.2 and
3.3)
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1.6.
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Base
Rent: Monthly Base Rent is payable in
advance on the first day of each month, per Paragraph
4.1.
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BASE
RENT AMOUNT
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FROM
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TO
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Monthly
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Annually
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10/1/2008
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through
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9/30/2009
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$6,915.00
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$82,980.00
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10/1/2009
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through
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9/30/2010
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$7,192.00
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$86,304.00
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10/1/2010
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through
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9/30/2011
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$7,480.00
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$89,760.00
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10/1/2011
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through
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9/30/2012
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$7,778.00
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$93,336.00
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10/1/2012
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through
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9/30/2013
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$8,090.00
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$97,080.00
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1.7.
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Tenant's Share of Common Area
Operating Expenses: Four and Ninety-Two
One-Hundredths percent (4.92%) ("Tenant's
Share").
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1.8.
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Base
Rent and Other Monies Paid Upon
Execution:
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(a) Base Rent: $ See Base Rent
Schedule for
the period N/A
(b) Common Area Operating Expenses:
$ 1,600/mo. for
the period 2008
(c ) Security Deposit: $ 6,915.00 ("Security Deposit"). (See
also Paragraph 5)
1.9
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Agreed Use: Manufacture,
distribution, sales and administration of gaming equipment and supplies
and printing of paper for gaming related
uses. (See also Paragraph
6)
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1.10
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Insuring Party. Landlord
is the "Insuring
Party". (See also Paragraph
8)
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1.11
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Real Estate Brokers:
(See also Paragraph 15)
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1.12
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Representation: The
following real estate brokers (the "Brokers") and brokerage
relationships exist in this transaction (check
boxes):
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□ N/A represents
Landlord exclusively ("Landlord's
Broker");
□ N/A represents Tenant
exclusively ("Tenant's
Broker"); or
X N/A represents
both Landlord and Tenant ("Dual
Agency").
1.13
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Payment
to Brokers: Upon execution and delivery of this Lease by both Parties,
Landlord shall pay to the Brokers the brokerage fee agreed to in a
separate written agreement (or if there is no such agreement, the sum of
N/A
or
-------- %
of the total Base Rent for the brokerage services rendered by the
Brokers).
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1.14
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Guarantor.
The obligations of the Tenant under this Lease are to be guaranteed
by n/a (See
attached Guarantee) ("Guarantor"). (See also Paragraph
37)
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1.15
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Addenda and Exhibits.
Attached hereto is an Addendum or Addenda and
Exhibits A
through E
, all of which constitute a part of this
Lease.
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2. Premises.
2. 1 Letting. Landlord hereby
leases to Tenant, and Tenant hereby leases from Landlord, the Premises, for the
term, at the rental, and upon all of the terms, covenants and conditions set
forth in this Lease. Unless otherwise provided herein, any statement of size set
forth in this Lease, or that may have been used in calculating Rent, is an
approximation which the Parties agree is reasonable and any payments based
thereon are not subject to revision whether or not the actual size is more or
less.
2. 2 Condition. Landlord shall
deliver that portion of the Premises contained within the Building ('Unit") to Tenant broom clean
and free of debris, “as-is,” “where-is,” and “all faults accepted” condition
upon the Commencement Date or the Early Possession Date, whichever first occurs
("Start Date"), and, so
long as the required service contracts described in Paragraph 7.1(b) below are
obtained by Tenant and in effect within thirty days following the Start Date,
warrants that the existing electrical, plumbing, fire sprinkler, lighting,
heating, ventilating and air conditioning systems ("HVAC"), loading doors, if
any, and all other such elements in the Unit, other than those constructed by
Tenant, shall be in good operating condition on said date and that the
structural elements of the roof, bearing walls and foundation of the Unit shall
be free of material defects. If a non-compliance with such warranty exists as of
the Start Date, or if one of such systems or elements should malfunction or fail
within the appropriate warranty period, Landlord shall, as Landlord's sole
obligation with respect to such matter, except as otherwise provided in this
Lease, promptly after receipt of written notice from Tenant setting forth with
specificity the nature and extent of such non-compliance, malfunction or
failure, rectify same at Landlord's expense. The warranty periods shall be as
follows: (i) 6 months as to the HVAC systems, and (ii) 30 days as to the
remaining systems and other elements of the Unit. If Tenant does not give
Landlord the required notice within the appropriate warranty period, correction
of any such non-compliance, malfunction or failure shall be the obligation of
Tenant at Tenant's sole cost and expense (except for the repairs to
the fire sprinkler systems, roof, foundations, and/or bearing walls - see
Paragraph 7).
2.3 Compliance. Landlord warrants
that the improvements on the Premises and the Common Areas comply with the
building codes that were in effect at the time that each such improvement, or
portion thereof, was constructed, and also with all applicable laws, covenants
or restrictions of record, regulations, and ordinances in effect on the Start
Date ("Applicable
Requirements"). Said warranty does not apply to the use to which Tenant
will put the Premises or to any Alterations or Utility Installations (as defined
in Paragraph 7.3(a)) made or to be made by Tenant. NOTE: Tenant is responsible for
determining whether or not the Applicable Requirements, and especially the
zoning, are appropriate for Tenant's intended use, and acknowledges that past
uses of the Premises may no longer be allowed. If the Premises do not
comply with said warranty, Landlord shall, except as otherwise provided,
promptly after receipt of written notice from Tenant setting forth with
specificity the nature and extent of such non-compliance, rectify the same at
Landlord's expense. If Tenant does not give Landlord written notice of a
non-compliance with this warranty within 6 months following the Start Date,
correction of that non-compliance shall be the obligation of Tenant at Tenant's
sole cost and expense. If the Applicable Requirements are hereafter changed so
as to require during the term of this Lease the construction of an addition to
or an alteration of the Unit, Premises and/or Building, the remediation of any
Hazardous Substance, or the reinforcement or other physical modification of the
Unit, Premises and/or Building ("Capital Expenditure"),
Landlord and Tenant shall allocate the cost of such work as
follows:
(a) Subject to Paragraph 2.3(c) below,
if such Capital Expenditures are required as a result of the specific and unique
use of the Premises by Tenant as compared with uses by tenants in general,
Tenant shall be fully responsible for the cost thereof, provided, however that
if such Capital Expenditure is required during the last 2 years of this Lease
and the cost thereof exceeds 6 months' Base Rent, Tenant may instead terminate
this Lease unless Landlord notifies Tenant, in writing, within 10 days after
receipt of Tenant's termination notice that Landlord has elected to pay the
difference between the actual cost thereof and the amount equal to 6 months'
Base Rent. If Tenant elects termination, Tenant shall immediately cease the use
of the Premises which requires such Capital Expenditure and deliver to Landlord
written notice specifying a termination date at least 90 days thereafter. Such
termination date shall, however, in no event be earlier than the last day that
Tenant could legally utilize the Premises without commencing such Capital
Expenditure.
(b) If such Capital Expenditure is not
the result of the specific and unique use of the Premises by Tenant (such as,
governmentally mandated seismic modifications), then Landlord and Tenant shall
allocate the obligation to pay for the portion of such costs reasonably
attributable to the Premises pursuant to the formula set out in Paragraph
7.1(d); provided, however, that if such Capital Expenditure is required during
the last 2 years of this Lease or if Landlord reasonably determines that it is
not economically feasible to pay its share thereof, Landlord shall have the
option to terminate this Lease upon 90 days prior written notice to Tenant
unless Tenant notifies Landlord, in writing, within 10 days after receipt of
Landlord's termination notice that Tenant will pay for such Capital Expenditure.
If Landlord does not elect to terminate, and fails to tender its share of any
such Capital Expenditure, Tenant may advance such funds and deduct same, with
Interest, from Rent until Landlord's share of such costs have been fully paid.
If Tenant is unable to finance Landlord's share, or if the balance of the Rent
due and payable for the remainder of this Lease is not sufficient to fully
reimburse Tenant on an offset basis, Tenant shall have the right to terminate
this Lease upon 30 days written notice to Landlord.
(c) Notwithstanding the above, the
provisions concerning Capital Expenditures are intended to apply only to
non-voluntary, unexpected, and new Applicable Requirements. If the Capital
Expenditures are instead triggered by Tenant as a result of an actual or
proposed change in use, change in intensity of use, or modification to the
Premises then, and in that event, Tenant shall be fully responsible for the cost
thereof, and Tenant shall not have any right to terminate this
Lease.
2.4 Acknowledgements. Tenant
acknowledges that: (a) it has been advised by Landlord and/or Brokers to satisfy
itself with respect to the condition of the Premises (including but not limited
to the electrical, HVAC and fire sprinkler systems, security, environmental
aspects, and compliance with Applicable Requirements and the Americans with
Disabilities Act), and their suitability for Tenant's intended use, (b) Tenant
has made such investigation as it deems necessary with reference to such matters
and assumes all responsibility therefor as the same relate to its occupancy of
the Premises, and (c) neither Landlord, Landlord's agents, nor Brokers have made
any oral or written representations or warranties with respect to said matters
other than as set forth in this Lease. In addition, Landlord acknowledges that:
(i) Brokers have made no representations, promises or warranties concerning
Tenant's ability to honor the Lease or suitability to occupy the Premises, and
(ii) it is Landlord's sole responsibility to investigate the financial
capability and/or suitability of all proposed tenants.
2.5 Tenant as Prior
Owner/Occupant. The warranties made by Landlord in Paragraph 2 shall be
of no force or effect if immediately prior to the Start Date Tenant was the
owner or occupant of the Premises. In such event, Tenant shall be responsible
for any necessary corrective work.
2.6 Vehicle Parking. Tenant shall
be entitled to use the number of Unreserved Parking Spaces and Reserved Parking
Spaces specified in Paragraph 1.2(b) on those portions of the Common Areas
designated from time to time by Landlord for parking. Tenant shall not use more
parking spaces than said number. Said parking spaces shall be used for parking
by vehicles no larger than full-size passenger automobiles or pick-up trucks,
herein called "Permitted Size
Vehicles." Landlord may regulate the loading and unloading of vehicles by
adopting Rules and Regulations as provided in Paragraph 2.9. No vehicles other
than Permitted Size Vehicles may be parked in the Common Area without the prior
written permission of Landlord.
(a) Tenant shall not permit or allow
any vehicles that belong to or are controlled by Tenant or Tenant's employees,
suppliers, shippers, customers, contractors or invitees to be loaded, unloaded,
or parked in areas other than those designated by Landlord for such
activities.
(b) Tenant shall not service or store
any vehicles in the Common Areas.
(c) If Tenant permits or allows any of
the prohibited activities described in this Paragraph 2.6, then Landlord 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 Tenant, which cost shall be immediately payable upon demand by
Landlord.
2.7 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 Project and interior utility raceways and installations
within the Unit that are provided and designated by the Landlord from time to
time for the general non-exclusive use of Landlord, Tenant and other tenants of
the Project and their respective employees, suppliers, shippers, customers,
contractors and invitees, including parking areas, loading and unloading areas,
trash areas, roadways, walkways, driveways and landscaped areas.
2.8 Common Areas - Tenant's
Rights. Landlord grants to Tenant, for the benefit of Tenant and its
employees, suppliers, shippers, contractors, 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 Landlord under the terms
hereof or under the terms of any rules and regulations or restrictions governing
the use of the Project. 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 Landlord or Landlord's designated
agent, which consent may be revoked at any time. In the event that any
unauthorized storage shall occur then Landlord 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 Tenant, which cost shall be
immediately payable upon demand by Landlord.
2.9 Common Areas - Rules and
Regulations. Landlord or such other person(s) as Landlord 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 the
Rules and Regulations as contained in Exhibit “C”, attached hereto and made a
part hereof by this reference, ("Rules and Regulations") for
the management, safety, care, and cleanliness of the grounds, the parking and
unloading of vehicles and the preservation of good order, as well as for the
convenience of other occupants or tenants of the Building and the Project and
their invitees. Tenant agrees to abide by and conform to all such Rules and
Regulations, and to cause its employees, suppliers, shippers, customers,
contractors and invitees to so abide and conform. Landlord shall not be
responsible to Tenant for the non-compliance with said Rules and Regulations by
other tenants of the Project.
2.10 Common Areas - Changes.
Landlord shall have the right, in Landlord'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,
walkways and utility raceways;
(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 Project 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
Project, or any portion thereof; and
(f) To do and perform such other acts
and make such other changes in, to or with respect to the Common Areas and
Project as Landlord may, in the exercise of sound business judgment, deem to be
appropriate.
3. Term.
3.1 Term. The Commencement Date,
Expiration Date and Original Term of this Lease are as specified in Paragraph
1.3.
3.2 Early Possession. If Tenant
totally or partially occupies the Premises prior to the Commencement Date, the
obligation to pay Base Rent shall be abated for the period of such early
possession. All other terms of this Lease (including but not limited to the
obligations to pay Tenant's Share of Common Area Operating Expenses, Real
Property Taxes and insurance premiums and to maintain the Premises) shall,
however, be in effect during such period. Any such early possession shall not
affect the Expiration Date.
3.3 Delay In Possession. Landlord
agrees to use its best commercially reasonable efforts to deliver possession of
the Premises to Tenant by the Commencement Date. If, despite said efforts,
Landlord is unable to deliver possession as agreed, Landlord shall not be
subject to any liability therefor, nor shall such failure affect the validity of
this Lease. Tenant shall not, however, be obligated to pay Rent or perform its
other obligations until it receives possession of the Premises. If possession is
not delivered within 60 days after the Commencement Date, Tenant may, at its
option, by notice in writing within 10 days after the end of such 60 day period,
cancel this Lease, in which event the Parties shall be discharged from all
obligations hereunder. If such written notice is not received by Landlord within
said 10 day period, Tenant's right to cancel shall terminate. Except as
otherwise provided, if possession is not tendered to Tenant by the Start Date
and Tenant does not terminate this Lease, as aforesaid, any period of rent
abatement that Tenant would otherwise have enjoyed shall run from the date of
delivery of possession and continue for a period equal to what Tenant would
otherwise have enjoyed under the terms hereof, but minus any days of delay
caused by the acts or omissions of Tenant. If possession of the Premises is not
delivered within 4 months after the Commencement Date, this Lease shall
terminate unless other agreements are reached between Landlord and Tenant, in
writing.
3.4 Tenant Compliance. Landlord
shall not be required to tender possession of the Premises to Tenant until
Tenant complies with its obligation to provide evidence of insurance (Paragraph
8.5). Pending delivery of such evidence, Tenant shall be required to perform all
of its obligations under this Lease from and after the Start Date, including the
payment of Rent, notwithstanding Landlord's election to withhold possession
pending receipt of such evidence of insurance. Further, if Tenant is required to
perform any other conditions prior to or concurrent with the Start Date, the
Start Date shall occur but Landlord may elect to withhold possession until such
conditions are satisfied.
4. Rent.
4.1 Rent Defined. All monetary
obligations of Tenant to Landlord under the terms of this Lease (except for the
Security Deposit) are deemed to be rent ("Rent").
4.2 Common Area Operating
Expenses. Tenant shall pay to Landlord during the term hereof, in
addition to the Base Rent, Tenant's Share (as specified in Paragraph 1.6) of all
Common Area Operating Expenses, as hereinafter defined, during each calendar
year of the term of this Lease, in accordance with the following
provisions:
(a) "Common Area Operating Expenses"
are defined, for purposes of this Lease, as all costs incurred by
Landlord relating to the ownership and operation of the Project, including, but
not limited to, the following:
(i) The operation, repair and
maintenance, in neat, clean, good order and condition of the
following:
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(aa)
The Common Areas and Common Area improvements, including parking areas,
loading and unloading areas, trash areas, roadways, parkways, walkways,
driveways, landscaped areas, bumpers, irrigation systems, Common Area
lighting facilities, fences and gates, elevators, roofs, and roof drainage
systems.
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(bb) Exterior signs and any tenant
directories.
(cc) Any fire detection and/or
sprinkler systems.
(ii) The cost of water, gas,
electricity and telephone to service the Common Areas and any utilities not
separately metered.
(iii) Trash disposal, pest control
services, property management security services, and the costs of any
environmental inspections.
(iv) Reserves set aside for maintenance
and repair of Common Areas.
(v) Real Property Taxes (as defined in
Paragraph 10).
(vi) The cost of the premiums for the
insurance maintained by Landlord pursuant to Paragraph 8.
(vii) Any deductible portion of an
insured loss concerning the Building or the Common Areas.
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(viii)
The cost of any Capital Expenditure to the Building or the Project not
covered under the provisions of Paragraph 2.3 provided; however, that
Landlord shall allocate the cost of any such Capital Expenditure over a 12
year period and Tenant shall not be required to pay more than Tenant's
Share of 1/144th of the cost of such Capital Expenditure in any given
month.
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(ix) Any other services to be provided
by Landlord that are stated elsewhere in this Lease to be a Common Area
Operating Expense.
(b) Any Common Area Operating Expenses
and Real Property Taxes that are specifically attributable to the Unit, the
Building or to any other building in the Project or to the operation, repair and
maintenance thereof, shall be allocated entirely to such Unit, Building, or
other building. However, any Common Area Operating Expenses and Real
Property Taxes that are not specifically attributable to the Building or to any
other building or to the operation, repair and maintenance thereof, shall be
equitably allocated by Landlord to all buildings in the Project.
(c) The inclusion of the improvements,
facilities and services set forth in Subparagraph 4.2(a) shall not be deemed to
impose an obligation upon Landlord to either have said improvements or
facilities or to provide those services unless the Project already has the same,
Landlord already provides the services, or Landlord has agreed elsewhere in this
Lease to provide the same or some of them.
(d) Tenant's Share of Common Area
Operating Expenses shall be payable by Tenant within 10 days after a reasonably
detailed statement of actual expenses is presented to Tenant. At Landlord's
option, however, an amount may be estimated by Landlord from time to time of
Tenant's Share of annual Common Area Operating Expenses and the same shall be
payable monthly or quarterly, as Landlord shall designate, during each 12 month
period of the Lease term, on the same day as the Base Rent is due hereunder.
Landlord shall deliver to Tenant within 60 days after the expiration of each
calendar year a reasonably detailed statement showing Tenant's Share of the
actual Common Area Operating Expenses incurred during the preceding year. If
Tenant's payments under this Paragraph 4.2(d) during the preceding year exceed
Tenant's Share as indicated on such statement, Landlord shall credit the amount
of such over-payment against Tenant's Share of Common Area Operating Expenses
next becoming due. If Tenant's payments under this Paragraph 4.2(d) during the
preceding year were less than Tenant's Share as indicated on such statement,
Tenant shall pay to Landlord the amount of the deficiency within 10 days after
delivery by Landlord to Tenant of the statement.
4.3 Payment. Tenant shall cause
payment of Rent to be received by Landlord in lawful money of the United States,
without offset or deduction (except as specifically permitted in this Lease), on
or before the day on which it is due. Rent for any period during the term hereof
which is for less than one full calendar month shall be prorated based upon the
actual number of days of said month. Payment of Rent shall be made to Landlord
at its address stated herein or to such other persons or place as Landlord may
from time to time designate in writing. Acceptance of a payment which is less
than the amount then due shall not be a waiver of Landlord's rights to the
balance of such Rent, regardless of Landlord's endorsement of any check so
stating. In the event that any check, draft, or other instrument of payment
given by Tenant to Landlord is dishonored for any reason, Tenant agrees to pay
to Landlord the sum of $25 in addition to any late charges which may be
due.
5. Security Deposit. Tenant shall
deposit with Landlord upon execution hereof the Security Deposit as security for
Tenant's faithful performance of its obligations under this Lease. If Tenant
fails to pay Rent, or otherwise Defaults under this Lease, Landlord may use,
apply or retain all or any portion of said Security Deposit for the payment of
any amount due Landlord or to reimburse or compensate Landlord for any
liability, expense, loss or damage which Landlord may suffer or incur by reason
thereof. If Landlord uses or applies all or any portion of the Security Deposit,
Tenant shall within 10 days after written request therefor deposit monies with
Landlord sufficient to restore said Security Deposit to the full amount required
by this Lease. If the Base Rent increases during the term of this Lease, Tenant
shall, upon written request from Landlord, deposit additional monies with
Landlord so that the total amount of the Security Deposit shall at all times
bear the same proportion to the increased Base Rent as the initial Security
Deposit bore to the initial Base Rent. Should the Agreed Use be amended to
accommodate a material change in the business of Tenant or to accommodate a
subTenant or assignee, Landlord shall have the right to increase the Security
Deposit to the extent necessary, in Landlord's reasonable judgment, to account
for any increased wear and tear that the Premises may suffer as a result
thereof. If a change in control of Tenant occurs during this Lease and following
such change the financial condition of Tenant is, in Landlord's reasonable
judgment, significantly reduced, Tenant shall deposit such additional monies
with Landlord as shall be sufficient to cause the Security Deposit to be at a
commercially reasonable level based on such change in financial condition.
Landlord shall not be required to keep the Security Deposit separate from its
general accounts. Within 14 days after the expiration or termination of this
Lease, if Landlord elects to apply the Security Deposit only to unpaid Rent, and
otherwise within 30 days after the Premises have been vacated pursuant to
Paragraph 7.4(c) below, Landlord shall return that portion of the Security
Deposit not used or applied by Landlord. No part of the Security Deposit shall
be considered to be held in trust, to bear interest or to be prepayment for any
monies to be paid by Tenant under this Lease.
6. Use.
6.1 Use. Tenant shall use and
occupy the Premises only for the Agreed Use, or any other legal use which is
reasonably comparable thereto, and for no other purpose. Tenant shall not use or
permit the use of the Premises in a manner that is unlawful, creates damage,
waste or a nuisance, or that disturbs occupants of or causes damage to
neighboring premises or properties. Landlord shall not unreasonably withhold or
delay its consent to any written request for a modification of the Agreed Use,
so long as the same will not impair the structural integrity of the improvements
on the Premises or the mechanical or electrical systems therein, and/or is not
significantly more burdensome to the Premises. If Landlord elects to withhold
consent, Landlord shall within 7 days after such request give written
notification of same, which notice shall include an explanation of Landlord's
objections to the change in the Agreed Use.
6.2 Hazardous
Substances.
(a) Reportable Uses Require
Consent. The term "Hazardous Substance" as used
in this Lease shall mean any product, substance, or waste whose presence, use,
manufacture, disposal, transportation, or release, either by itself or in
combination with other materials expected to be on the Premises, is either: (i)
potentially injurious to the public health, safety or welfare, the environment
or the Premises, (ii) regulated or monitored by any
governmental
authority, or (iii) a basis for potential liability of Landlord to any
governmental agency or third party under any applicable statute or common law
theory. Hazardous Substances shall include, but not be limited to, hydrocarbons,
petroleum, gasoline, and/or crude oil or any products, by-products or fractions
thereof. Tenant shall not engage in any activity in or on the Premises which
constitutes a Reportable Use of Hazardous Substances without the express prior
written consent of Landlord and timely compliance (at Tenant's expense) with all
Applicable Requirements. "Reportable Use" shall mean
(i) the installation or use of any above or below ground storage tank, (ii) the
generation, possession, storage, use, transportation, or disposal of a Hazardous
Substance that requires a permit from, or with respect to which a report,
notice, registration or business plan is required to be filed with, any
governmental authority, and/or (iii) the presence at the Premises of a Hazardous
Substance with respect to which any Applicable Requirements requires that a
notice be given to persons entering or occupying the Premises or neighboring
properties. Notwithstanding the foregoing, Tenant may use any ordinary and
customary materials reasonably required to be used in the normal course of the
Agreed Use, so long as such use is in compliance with all Applicable
Requirements, is not a Reportable Use, and does not expose the Premises or
neighboring property to any meaningful risk of contamination or damage or expose
Landlord to any liability therefor. In addition, Landlord may condition its
consent to any Reportable Use upon receiving such additional assurances as
Landlord reasonably deems necessary to protect itself, the public, the Premises
and/or the environment against damage, contamination, injury and/or liability,
including, but not limited to, the installation (and removal on or before Lease
expiration or termination) of protective modifications (such as concrete
encasements) and/or increasing the Security Deposit.
(b) Duty to Inform Landlord. If
Tenant knows, or has reasonable cause to believe, that a Hazardous Substance has
come to be located in, on, under or about the Premises, other than as previously
consented to by Landlord, Tenant shall immediately give written notice of such
fact to Landlord, and provide Landlord with a copy of any report, notice, claim
or other documentation which it has concerning the presence of such
Hazardous
Substance.
(c) Tenant Remediation. Tenant
shall not cause or permit any Hazardous Substance to be spilled or released in,
on, under, or about the Premises (including through the plumbing or sanitary
sewer system) and shall promptly, at Tenant's expense, take all investigatory
and/or remedial action reasonably recommended, whether or not formally ordered
or required, for the cleanup of any contamination of, and for the maintenance,
security and/or monitoring of the Premises or neighboring properties, that was
caused or materially contributed to by Tenant, or pertaining to or involving any
Hazardous Substance brought onto the Premises during the term of this Lease, by
or for Tenant, or any third party.
(d) Tenant Indemnification. Tenant
shall indemnify, defend and hold Landlord, its agents, employees, lenders and
ground Landlord, if any, harmless from and against any and all loss of rents
and/or damages, liabilities, judgments, claims, expenses, penalties, and
attorneys' and consultants' fees arising out of or involving any Hazardous
Substance brought onto the Premises by or for Tenant, or any third party
(provided, however, that Tenant shall have no liability under this Lease with
respect to underground migration of any Hazardous Substance under the Premises
from areas outside of the Project). Tenant's obligations shall
include, but not be limited to, the effects of any contamination or injury to
person, property or the environment created or suffered by Tenant, and the cost
of investigation, removal, remediation, restoration and/or abatement, and shall
survive the expiration or termination of this Lease. No termination,
cancellation or release agreement entered into by Landlord and Tenant shall
release Tenant from its obligations under this Lease with respect to Hazardous
Substances, unless specifically so agreed by Landlord in writing at the time of
such agreement.
(e) Landlord Indemnification.
Landlord and its successors and assigns shall indemnify, defend, reimburse and
hold Tenant, its employees and lenders, harmless from and against any and all
environmental damages, including the cost of remediation, which existed as a
result of Hazardous Substances on the Premises prior to the Start Date or which
are caused by the gross negligence or willful misconduct of Landlord, its agents
or employees. Landlord's obligations, as and when required by the Applicable
Requirements, shall include, but not be limited to, the cost of investigation,
removal, remediation, restoration and/or abatement, and shall survive the
expiration or termination of this Lease.
(f) Investigations and
Remediations. Landlord shall retain the responsibility and pay for any
investigations or remediation measures required by governmental entities having
jurisdiction with respect to the existence of Hazardous Substances on the
Premises prior to the Start Date, unless such remediation measure is required as
a result of Tenant's use (including "Alterations", as defined in paragraph
7.3(a) below) of the Premises, in which event Tenant shall be responsible for
such payment. Tenant shall cooperate fully in any such activities at the request
of Landlord, including allowing Landlord and Landlord's agents to have
reasonable access to the Premises at reasonable times in order to carry out
Landlord's investigative and remedial responsibilities.
(g) Landlord Termination Option.
If a Hazardous Substance Condition (see Paragraph 9.1(e)) occurs during the term
of this Lease, unless Tenant is legally responsible therefor (in which case
Tenant shall make the investigation and remediation thereof required by the
Applicable Requirements and this Lease shall continue in full force and effect,
but subject to Landlord's rights under Paragraph 6.2(d) and Paragraph 13),
Landlord may, at Landlord's option, either (i) investigate and remediate such
Hazardous Substance Condition, if required, as soon as reasonably possible at
Landlord's expense, in which event this Lease shall continue in full force and
effect, or (ii) if the estimated cost to remediate such condition exceeds 12
times the then monthly Base Rent or $100,000, whichever is greater, give written
notice to Tenant, within 30 days after receipt by Landlord of knowledge of the
occurrence of such Hazardous Substance Condition, of Landlord's desire to
terminate this Lease as of the date 60 days following the date of such notice.
In the event Landlord elects to give a termination notice, Tenant may, within 10
days thereafter, give written notice to Landlord of Tenant's commitment to pay
the amount by which the cost of the remediation of such Hazardous Substance
Condition exceeds an amount equal to 12 times the then monthly Base Rent or
$100,000, whichever is greater. Tenant shall provide Landlord with said funds or
satisfactory assurance thereof within 30 days following such commitment. In such
event, this Lease shall continue in full force and effect, and Landlord shall
proceed to make such remediation as soon as reasonably possible after the
required funds are available. If Tenant does not give such notice and provide
the required funds or assurance thereof within the time provided, this Lease
shall terminate as of the date specified in Landlord's notice of
termination.
6. 3 Tenant's Compliance with Applicable
Requirements. Except as otherwise provided in this Lease, Tenant shall,
at Tenant's sole expense, fully, diligently and in a timely manner, materially
comply with all Applicable Requirements, the requirements of any applicable fire
insurance underwriter or rating bureau, and the recommendations of Landlord's
engineers and/or consultants which relate in any manner to the Premises, without
regard to whether said requirements are now in effect or become effective after
the Start Date. Tenant shall, within 10 days after receipt of Landlord's written
request, provide Landlord with copies of all permits and other documents, and
other information evidencing Tenant's compliance with any Applicable
Requirements specified by Landlord, and shall immediately upon receipt, notify
Landlord in writing (with copies of any documents involved) of any threatened or
actual claim, notice, citation, warning, complaint or report pertaining to or
involving the failure of Tenant or the Premises to comply with any Applicable
Requirements.
6. 4 Inspection; Compliance.
Landlord and Landlord's "Lender" (as defined in
Paragraph 30) and consultants shall have the right to enter into Premises at any
time, in the case of an emergency, and otherwise at reasonable times, for the
purpose of inspecting the condition of the Premises and for verifying compliance
by Tenant with this Lease. The cost of any such inspections shall be paid by
Landlord, unless a violation of Applicable Requirements, or a contamination is
found to exist or be imminent, or the inspection is requested or ordered by a
governmental authority. In such case, Tenant shall upon request reimburse
Landlord for the cost of such inspection, so long as such inspection is
reasonably related to the violation or contamination.
7. Maintenance; Repairs, Utility
Installations; Trade Fixtures and Alterations.
7. 1 Tenant's
Obligations.
(a) In General. Subject to the
provisions of Paragraph 2.2 (Condition), 2.3 (Compliance), 6.3 (Tenant's
Compliance with Applicable Requirements), 7.2 (Landlord's Obligations), 9
(Damage or Destruction), and 14 (Condemnation), Tenant shall, at Tenant's sole
expense, keep the Premises, Utility Installations (intended for Tenant's
exclusive use, no matter where located), and Alterations in good order,
condition and repair (whether or not the portion of the Premises requiring
repairs, or the means of repairing the same, are reasonably or readily
accessible to Tenant, and whether or not the need for such repairs occurs as a
result of Tenant's use, any prior use, the elements or the age of such portion
of the Premises), including, but not limited to, all equipment or facilities,
such as plumbing, HVAC equipment, electrical, lighting facilities, boilers,
pressure vessels, fixtures, interior walls, interior surfaces of exterior walls,
ceilings, floors, windows, doors, plate glass, and skylights but excluding any
items which are the responsibility of Landlord pursuant to Paragraph 7.2.
Tenant, in keeping the Premises in good order, condition and repair, shall
exercise and perform good maintenance practices, specifically including the
procurement and maintenance of the service contracts required by Paragraph
7.1(b) below. Tenant'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.
(b) Service Contracts. Tenant
shall, at Tenant's sole expense, procure and maintain contracts, with copies to
Landlord, in customary form and substance for, and with contractors specializing
and experienced in the maintenance of the following equipment and improvements,
if any, if and when installed on the Premises: (i) HVAC equipment, (ii) boiler
and pressure vessels, (iii) clarifiers, and (iv) any other equipment, if
reasonably required by Landlord. However, Landlord reserves the right, upon
notice to Tenant, to procure and maintain any or all of such service contracts,
and if Landlord so elects, Tenant shall reimburse Landlord, upon demand, for the
cost thereof.
(c ) Failure to Perform. If Tenant
fails to perform Tenant's obligations under this Xxxxxxxxx 0.0, Xxxxxxxx may
enter upon the Premises after 10 days' prior written notice to Tenant (except in
the case of an emergency, in which case no notice shall be required), perform
such obligations on Tenant's behalf, and put the Premises in good order,
condition and repair, and Tenant shall promptly reimburse Landlord for the cost
thereof.
(d) Replacement. Subject to
Tenant's indemnification of Landlord as set forth in Paragraph 8.7 below, and
without relieving Tenant of liability resulting from Tenant's failure to
exercise and perform good maintenance practices, if an item described in
Paragraph 7.1(b) cannot be repaired other than at a cost which is in excess of
50% of the cost of replacing such item, then such item shall be replaced by
Landlord, and the cost thereof shall be prorated between the Parties and Tenant
shall only be obligated to pay, each month during the remainder of the term of
this Lease, on the date on which Base Rent is due, an amount equal to the
product of multiplying the cost of such replacement by a fraction, the numerator
of which is one, and the denominator of which is 144 (ie. 1/144th of the cost
per month). Tenant shall pay interest on the unamortized balance at a rate that
is commercially reasonable in the judgment of Landlord's accountants. Tenant
may, however, prepay its obligation at any time.
7. 2 Landlord's Obligations.
Subject to the provisions of Paragraphs 2.2 (Condition), 2.3 (Compliance), 4.2
(Common Area Operating Expenses), 6 (Use), 7.1 (Tenant's Obligations), 9 (Damage
or Destruction) and 14 (Condemnation), Landlord, subject to reimbursement
pursuant to Paragraph 4.2, shall keep in good order, condition and repair the
foundations, exterior walls, structural condition of interior bearing walls,
exterior roof, fire sprinkler system, Common Area fire alarm and/or smoke
detection systems, fire hydrants, parking lots, walkways, parkways, driveways,
landscaping, fences, signs and utility systems serving the Common Areas and all
parts thereof, as well as providing the services for which there is a Common
Area Operating Expense pursuant to Paragraph 4.2. Landlord shall not be
obligated to paint the exterior or interior surfaces of exterior walls nor shall
Landlord be obligated to maintain, repair or replace windows, doors or plate
glass of the Premises. Tenant expressly waives the benefit of any statute now or
hereafter in effect to the extent it is inconsistent with the terms of this
Lease.
7. 3 Utility Installations; Trade
Fixtures; Alterations.
(a) Definitions. The term "Utility Installations" refers
to all floor and window coverings, air lines, power panels, electrical
distribution, security and fire protection systems, communication systems,
lighting fixtures, HVAC equipment, plumbing, and fencing in or on the
Premises. The term "Trade Fixtures" shall mean
Tenant's machinery and equipment that can be removed without doing material
damage to the Premises. The term "Alterations" shall mean any
modification of the improvements, other than Utility Installations or Trade
Fixtures, whether by addition or deletion. "Tenant Owned Alterations and/or
Utility Installations" are defined as Alterations and/or Utility
Installations made by Tenant that are not yet owned by Landlord pursuant to
Paragraph 7.4(a).
(b) Consent. Tenant shall not make
any Alterations or Utility Installations to the Premises without Landlord's
prior written consent. Tenant may, however, make non-structural Utility
Installations to the interior of the Premises (excluding the roof) without such
consent but upon notice to Landlord, as long as they are not visible from the
outside, do not involve puncturing, relocating or removing the roof or any
existing walls, and the cumulative cost thereof during this Lease as extended
does not exceed a sum equal to 3 month's Base Rent in the aggregate or a sum
equal to one month's Base Rent in any one year. Notwithstanding the foregoing,
Tenant shall not make or permit any roof penetrations and/or install anything on
the roof without the prior written approval of Landlord. Landlord may, as a
precondition to granting such approval, require Tenant to utilize a contractor
chosen and/or approved by Landlord. Any Alterations or Utility
Installations that Tenant shall desire to make and which require the consent of
the Landlord shall be presented to Landlord in written form with detailed plans.
Consent shall be deemed conditioned upon Tenant's: (i) acquiring all applicable
governmental permits, (ii) furnishing Landlord with copies of both the permits
and the plans and specifications prior to commencement of the work, and (iii)
compliance with all conditions of said permits and other Applicable Requirements
in a prompt and expeditious manner. Any Alterations or Utility Installations
shall be performed in a workmanlike manner with good and sufficient materials.
Tenant shall promptly upon completion furnish Landlord with as-built plans and
specifications. For work which costs an amount in excess of one month's Base
Rent, Landlord may condition its consent upon Tenant providing a lien and
completion bond in an amount equal to 150% of the estimated cost of such
Alteration or Utility Installation and/or upon Tenant's posting an additional
Security Deposit with Landlord.
(c) Indemnification. Tenant shall
pay, when due, all claims for labor or materials furnished or alleged to have
been furnished to or for Tenant at or for use on the Premises, which claims are
or may be secured by any mechanic's or materialman's lien against the Premises
or any interest therein. Tenant shall give Landlord not less than 10 days notice
prior to the commencement of any work in, on or about the Premises, and Landlord
shall have the right to post notices of non-responsibility. If Tenant shall
contest the validity of any such lien, claim or demand, then Tenant shall, at
its sole expense defend and protect itself, Landlord and the Premises against
the same and shall pay and satisfy any such adverse judgment that may be
rendered thereon before the enforcement thereof. If Landlord shall require,
Tenant shall furnish a surety bond in an amount equal to 150% of the amount of
such contested lien, claim or demand, indemnifying Landlord against liability
for the same. If Landlord elects to participate in any such action, Tenant shall
pay Landlord's attorneys' fees and costs.
7.4 Ownership; Removal; Surrender; and
Restoration.
(a) Ownership. Subject to
Landlord's right to require removal or elect ownership as hereinafter provided,
all Alterations and Utility Installations made by Tenant shall be the property
of Tenant, but considered a part of the Premises. Landlord may, at any time,
elect in writing to be the owner of all or any specified part of the Tenant
Owned Alterations and Utility Installations. Unless otherwise instructed per
paragraph 7.4(b) hereof, all Tenant Owned Alterations and Utility Installations
shall, at the expiration or termination of this Lease, become the property of
Landlord and be surrendered by Tenant with the Premises.
(b) Removal. By delivery to Tenant
of written notice from Landlord not earlier than 90 and not later than 30 days
prior to the end of the term of this Lease, Landlord may require that any or all
Tenant Owned Alterations or Utility Installations be removed by the expiration
or termination of this Lease. Landlord may require the removal at any time of
all or any part of any Tenant Owned Alterations or Utility Installations made
without the required consent.
(c) Surrender; Restoration. Tenant
shall surrender the Premises by the Expiration Date or any earlier termination
date, with all of the improvements, parts and surfaces thereof broom clean and
free of debris, and in good operating order, condition and state of repair,
ordinary wear and tear excepted. "Ordinary wear and tear" shall not include any
damage or deterioration that would have been prevented by good maintenance
practice. Notwithstanding the foregoing, if this Lease is for 12 months or less,
then Tenant shall surrender the Premises in the same condition as delivered to
Tenant on the Start Date with NO allowance for ordinary wear and tear. Tenant
shall repair any damage occasioned by the installation, maintenance or removal
of Trade Fixtures, Tenant owned Alterations and/or Utility Installations,
furnishings, and equipment as well as the removal of any storage tank installed
by or for Tenant. Tenant shall also completely remove from the Premises any and
all Hazardous Substances brought onto the Premises by or for Tenant, or any
third party (except Hazardous Substances which were deposited via underground
migration from areas outside of the Project) even if such removal would require
Tenant to perform or pay for work that exceeds statutory requirements. Trade
Fixtures shall remain the property of Tenant and shall be removed by Tenant. The
failure by Tenant to timely vacate the Premises pursuant to this Paragraph
7.4(c) without the express written consent of Landlord shall constitute a
holdover under the provisions of Paragraph 26 below.
8. Insurance;
Indemnity.
8.1 Liability Insurance-Tenant.
Without limiting the insurance requirements contained in
Exhibit “D” attached hereto, Tenant shall, at all Tenant’s expense, obtain and
keep in force during the term of this Lease a policy of Comprehensive General
Liability insurance utilizing an Insurance Services Office Standard Form with
Broad Form General Liability Endorsement, in an amount of not less than
$1,000,000 per occurrence of bodily injury and property damage combined or in a
greater amount as reasonably determined by Landlord and shall insure Tenant with
Landlord and Landlord’s asset management and property management companies as an
additional insureds against liability arising out of the use, occupancy or
maintenance of the Premises. Compliance with the above requirement
shall not limit the liability of Tenant hereunder.
8.2 Property
Insurance-Tenant. Without limiting the insurance requirements
contained in Exhibit “D” attached hereto, Tenant shall, at Tenant’s expense,
obtain and keep in force during the term of this Lease, replacement cost fire
and extended coverage insurance, with vandalism and malicious mischief,
sprinkler leakage and earthquake sprinkler leakage endorsements, in an amount
sufficient to cover not less than 100% of the full replacement cost, as the same
may exist from time to time, of all of Tenant’s personal property, fixtures,
equipment and tenant improvements.
8.3 Insurance Policies. Without
limiting the insurance requirements contained in Exhibit “D” attached hereto,
Tenant shall deliver to Landlord copies of liability insurance policies required
under Paragraph 8.1 or certificates evidencing the existence and amounts of such
insurance prior to Tenant’s possession of the Premises. Additionally,
Tenant shall deliver to Landlord the certificates showing the additional
insureds set forth in Paragraph 5 of Exhibit “D.” No such
policy shall be cancelable or subject to reduction of coverage or other
modification except after thirty (30) days prior written notice to
Landlord. Tenant shall, at least thirty (30) days prior to the
expiration of such policies, furnish Landlord with renewals
thereof.
8.4 Waiver of Subrogation. Tenant
hereby releases and relieves Landlord, and waives Tenant’s entire right of
recovery against Landlord, for direct or consequential loss or damage arising
out of or incident to the perils covered by property insurance carried by
Tenant, whether due to the negligence of Landlord or their agents, employees,
contractors and/or invitees. If necessary, all property insurance
policies required under this Lease shall be endorsed to so provide.
8.5 Assumption
of Risk and Indemnification.
(a) Assumption of Risk. Tenant, as a
material part of the consideration to Landlord, agrees that neither Landlord nor
Landlord partners, members, officers, directors, employees, agents, attorneys,
lenders, successors and assigns (collectively, "Landlord Indemnified Parties")
shall be liable to Tenant for, and Tenant expressly assumes the risk of and
waives any and all claims it may have against Landlord or any Landlord
Indemnified Parties with respect to, (i) any and all damage to property or
injury to persons in, upon or about the Premises or the Industrial Project
resulting from the act or omission (except for the grossly negligent or
intentionally wrongful act or omission) of Landlord, (ii) any such damage caused
by other tenants or persons in or about the Industrial Project, or caused by
quasi-public work, (iii) any damage to property entrusted to employees of the
Industrial Project, (iv) any loss of or damage to property by theft or
otherwise, or (v) any injury or damage to persons or property resulting from any
casualty, explosion, falling plaster or other masonry or glass, steam, gas,
electricity, water or rain which may leak from any part of the Industrial
Project or any other portion of the Common Areas or from the pipes, appliances
or plumbing works therein or from the roof, street or subsurface or from any
other place, or resulting from dampness. Neither Landlord nor any
Landlord Indemnified Parties will be liable for consequential damages arising
out of any loss of the use of the Premises or any equipment or facilities
therein by Tenant or Tenant’s agents, employees, subtenants, assignees,
licensees, contractors or invitees (collectively, "Tenant's Parties") or for
interference with light. Tenant agrees to give prompt notice to Landlord in case
of fire or accidents in the Premises or the Office Building, or of
defects therein or in the fixtures or equipment.
(b)
Indemnification. Tenant will be liable for, and agrees, to the maximum extent
permissible under applicable law, to promptly indemnify, protect, defend and
hold harmless Landlord and all Landlord Indemnified Parties (defined in 8.5(a)
above), from and against, any and all claims, damages, judgments, suits, causes
of action, losses, liabilities, penalties, fines, expenses and costs including
attorneys' fees and court costs (collectively, "Indemnified Claims"), arising or
resulting from (i) any act or omission of Tenant or any Tenant Parties; (ii) the
use of the Premises, Common Areas, or the Industrial Project and conduct of
Tenant's business by Tenant or any Tenant Parties, or any other activity, work
or thing done, permitted or suffered by Tenant or any Tenant Parties, in or
about the Premises, the Industrial Project or elsewhere; and/or (iii) any
default by Tenant of any obligations on Tenant's part to be performed under the
terms of this Lease. In case any claim, action or proceeding is
brought against Landlord or any Landlord Indemnified Parties by reason of any
such Indemnified Claims, Tenant, upon notice from Landlord, agrees to promptly
defend the same at Tenant's sole cost and expense by counsel approved in writing
by Landlord, which approval Landlord will not unreasonably
withhold.
(c)
Survival; No Release of Insurers. Tenant's indemnification obligations under
Subparagraph 8.5(b) will survive the expiration or earlier termination of this
Lease. Tenant's covenants, agreements and indemnification obligations arising
pursuant to Subparagraphs 8.5 (a) and 8.5 (b) above, are not intended to and
shall not relieve any insurance carrier of its obligations under policies
required to be carried by Tenant pursuant to the provisions of this
Lease.
8.6 No Representation of Adequate
Coverage. Landlord makes no representation that the limits or forms of
coverage of insurance specified in this Paragraph 8 are adequate to cover
Tenant’s property or obligations under this Lease.
8.7 Failure to Maintain
Insurance. For any period or periods in which Tenant fails to
maintain any insurance required by this Lease, or, if after ten (10) days
following the Commencement Date, Tenant has not provided Landlord with the
Additional Insured-Manager’s or Landlord’s, or other required additional Insured
Endorsements required to be submitted pursuant to this Lease, without further
notice, Base Rent shall be automatically increased by Two Hundred and Fifty
Dollars ($250.00) per month, until such time as Tenant complies with the
insurance provisions of this Lease. Notwithstanding anything
contained herein to the contrary, the foregoing shall not be construed,
interpreted, or deemed (i) a waiver of any default created by reason of Tenant’s
failure to provide the insurance certificates and endorsements called for in
this Lease; (ii) limit any other right or remedy of Landlord; (iii) relieve
Tenant of its obligations regarding maintenance of insurance as provided by the
Lease; or (iv) be considered a policy of insurance in favor of
Tenant. Landlord and Tenant agree the additional monthly charge
described herein represents a fair and reasonable estimate of the additional
administrative costs Landlord will incur by reason of any failure by Tenant to
provide the required insurance documentation to Landlord.
9. Damage or
Destruction.
9. 1 Definitions.
(a) "Premises Partial Damage"
shall mean damage or destruction to the improvements on the Premises,
other than Tenant Owned Alterations and Utility Installations, which can
reasonably be repaired in 3 months or less from the date of the damage or
destruction, and the cost thereof does not exceed a sum equal to 6 month's Base
Rent. Landlord shall notify Tenant in writing within 30 days from the date of
the damage or destruction as to whether or not the damage is Partial or
Total.
(b) "Premises Total Destruction"
shall mean damage or destruction to the improvements on the Premises,
other than Tenant Owned Alterations and Utility Installations and Trade
Fixtures, which cannot reasonably be repaired in 3 months or less from the date
of the damage or destruction and/or the cost thereof exceeds a sum equal to 6
month's Base Rent. Landlord shall notify Tenant in writing within 30 days from
the date of the damage or destruction as to whether or not the damage is Partial
or Total.
(c) "Insured Loss" shall mean
damage or destruction to improvements on the Premises, other than Tenant Owned
Alterations and Utility Installations and Trade Fixtures, which was caused by an
event required to be covered by the insurance described in Paragraph 8.3(a),
irrespective of any deductible amounts or coverage limits involved.
(d) "Replacement Cost" shall mean
the cost to repair or rebuild the improvements owned by Landlord at the time of
the occurrence to their condition existing immediately prior thereto, including
demolition, debris removal and upgrading required by the operation of Applicable
Requirements, and without deduction for depreciation.
(e) "Hazardous Substance Condition"
shall mean the occurrence or discovery of a condition involving the
presence of, or a contamination by, a Hazardous Substance as defined in
Paragraph 6.2(a), in, on, or under the Premises.
9.2 Partial Damage - Insured Loss.
If a Premises Partial Damage that is an Insured Loss occurs, then Landlord
shall, at Landlord's expense, repair such damage (but not Tenant's Trade
Fixtures or Tenant Owned Alterations and Utility Installations) as soon as
reasonably possible and this Lease shall continue in full force and effect;
provided, however, that Tenant shall, at Landlord's election, make the repair of
any damage or destruction the total cost to repair of which is $5,000 or less,
and, in such event, Landlord shall make any applicable insurance proceeds
available to Tenant on a reasonable basis for that purpose. Notwithstanding the
foregoing, if the required insurance was not in force or the insurance proceeds
are not sufficient to effect such repair, the Insuring Party shall promptly
contribute the shortage in proceeds as and when required to complete said
repairs. In the event, however, such shortage was due to the fact that, by
reason of the unique nature of the improvements, full replacement cost insurance
coverage was not commercially reasonable and available, Landlord shall have no
obligation to pay for the shortage in insurance proceeds or to fully restore the
unique aspects of the Premises unless Tenant provides Landlord with the funds to
cover same, or adequate assurance thereof, within 10 days following receipt of
written notice of such shortage and request therefor. If Landlord receives said
funds or adequate assurance thereof within said 10 day period, the party
responsible for making the repairs shall complete them as soon as reasonably
possible and this Lease shall remain in full force and effect. If such funds or
assurance are not received, Landlord may nevertheless elect by written notice to
Tenant within 10 days thereafter to: (i) make such restoration and repair as is
commercially reasonable with Landlord paying any shortage in proceeds, in which
case this Lease shall remain in full force and effect, or (ii) have this Lease
terminate 30 days thereafter. Tenant shall not be entitled to reimbursement of
any funds contributed by Tenant to repair any such damage or destruction.
Premises Partial Damage due to flood or earthquake shall be subject to Paragraph
9.3, notwithstanding that there may be some insurance coverage, but the net
proceeds of any such insurance shall be made available for the repairs if made
by either Party.
9. 3 Partial Damage - Uninsured
Loss. If a Premises Partial Damage that is not an Insured Loss occurs,
unless caused by a negligent or willful act of Tenant (in which event Tenant
shall make the repairs at Tenant's expense), Landlord may either: (i) repair
such damage as soon as reasonably possible at Landlord's expense, in which event
this Lease shall continue in full force and effect, or (ii) terminate this Lease
by giving written notice to Tenant within 30 days after receipt by Landlord of
knowledge of the occurrence of such damage. Such termination shall be effective
60 days following the date of such notice. In the event Landlord elects to
terminate this Lease, Tenant shall have the right within 10 days after receipt
of the termination notice to give written notice to Landlord of Tenant's
commitment to pay for the repair of such damage without reimbursement from
Landlord. Tenant shall provide Landlord with said funds or satisfactory
assurance thereof within 30 days after making such commitment. In such event
this Lease shall continue in full force and effect, and Landlord shall proceed
to make such repairs as soon as reasonably possible after the required funds are
available. If Tenant does not make the required commitment, this Lease shall
terminate as of the date specified in the termination notice.
9. 4 Total Destruction.
Notwithstanding any other provision hereof, if a Premises Total Destruction
occurs, this Lease shall terminate 60 days following such Destruction. If the
damage or destruction was caused by the gross negligence or willful misconduct
of Tenant, Landlord shall have the right to recover Landlord's damages from
Tenant, except as provided in Paragraph 8.6.
9. 5 Damage Near End of Term. If at
any time during the last 6 months of this Lease there is damage for which the
cost to repair exceeds one month's Base Rent, whether or not an Insured Loss,
Landlord may terminate this Lease effective 60 days following the date of
occurrence of such damage by giving a written termination notice to Tenant
within 30 days after the date of occurrence of such damage. Notwithstanding the
foregoing, if Tenant at that time has an exercisable option to extend this Lease
or to purchase the Premises, then Tenant may preserve this Lease by, (a)
exercising such option and (b) providing Landlord with any shortage in insurance
proceeds (or adequate assurance thereof) needed to make the repairs on or before
the earlier of (i) the date which is 10 days after Tenant's receipt of
Landlord's written notice purporting to terminate this Lease, or (ii) the day
prior to the date upon which such option expires. If Tenant duly exercises such
option during such period and provides Landlord with funds (or adequate
assurance thereof) to cover any shortage in insurance proceeds, Landlord shall,
at Landlord's commercially reasonable expense, repair such damage as soon as
reasonably possible and this Lease shall continue in full force and effect. If
Tenant fails to exercise such option and provide such funds or assurance during
such period, then this Lease shall terminate on the date specified in the
termination notice and Tenant's option shall be extinguished.
9.6 Abatement of Rent; Tenant's
Remedies.
(a) Abatement. In the event of
Premises Partial Damage or Premises Total Destruction or a Hazardous Substance
Condition for
which
Tenant is not responsible under this Lease, the Rent payable by Tenant for the
period required for the repair, remediation or restoration of such
damage
shall be abated in proportion to the degree to which Tenant's use of the
Premises is impaired, but not to exceed the proceeds received from
the
Rental
Value insurance. All other obligations of Tenant hereunder shall be performed by
Tenant, and Landlord shall have no liability for any such damage, destruction,
remediation, repair or restoration except as provided herein.
(b) Remedies. If Landlord shall be
obligated to repair or restore the Premises and does not commence, in a
substantial and
meaningful
way, such repair or restoration within 90 days after such obligation shall
accrue, Tenant may, at any time prior to the commencement of such
repair or
restoration, give written notice to Landlord and to any Lenders of which Tenant
has actual notice, of Tenant's election to terminate this Lease on a date not
less than 60 days following the giving of such notice. If Tenant gives such
notice and such repair or restoration is not commenced within 30 days
thereafter, this Lease shall terminate as of the date specified in said notice.
If the repair or restoration is commenced within such 30 days, this Lease shall
continue in full force and effect. "Commence" shall mean either the
unconditional authorization of the preparation of the required plans, or the
beginning of the actual work on the Premises, whichever first
occurs.
9. 7 Termination; Advance Payments.
Upon termination of this Lease pursuant to Paragraph 6.2(g) or Paragraph 9, an
equitable
adjustment
shall be made concerning advance Base Rent and any other advance payments made
by Tenant to Landlord. Landlord shall, in addition, return to
Tenant so
much of Tenant's Security Deposit as has not been, or is not then required to
be, used by Landlord.
9. 8 Waive Statutes. Landlord and
Tenant agree that the terms of this Lease shall govern the effect of any damage
to or destruction of the
Premises
with respect to the termination of this Lease and hereby waive the provisions of
any present or future statute to the extent inconsistent herewith.
10. Real Property
Taxes.
10. 1 Definition. As used herein,
the term "Real Property Taxes"
shall include any form of assessment; real estate, general, special,
ordinary or major structural
defects pre-existing Tenant's occupancy, or extraordinary, or
rental levy or tax (other than inheritance, personal income or estate taxes);
improvement bond; and/or license fee imposed upon or levied against any legal or
equitable interest of Landlord in the Project, Landlord's right to other income
therefrom, and/or Landlord's business of leasing, by any authority having the
direct or indirect power to tax and where the funds are generated with reference
to the Project address and where the proceeds so generated are to be applied by
the city, county or other local taxing authority of a jurisdiction within which
the Project is located. The term "Real Property Taxes" shall also include any
tax, fee, levy, assessment or charge, or any increase therein, imposed by reason
of events occurring during the term of this Lease, including but not limited to,
a change in the ownership of the Project or any portion thereof or a change in
the improvements thereon. In calculating Real Property Taxes for any calendar
year, the Real Property Taxes for any real estate tax year shall be included in
the calculation of Real Property Taxes for such calendar year based upon the
number of days which such calendar year and tax year have in
common.
10.2 Payment of Taxes. Landlord
shall pay the Real Property Taxes applicable to the Project, and except as
otherwise provided in Paragraph 10.3, any such amounts shall be included in the
calculation of Common Area Operating Expenses in accordance with the provisions
of Paragraph 4.2.
10. 3 Additional Improvements.
Common Area Operating Expenses shall not include Real Property Taxes specified
in the tax assessor's records and work sheets as being caused by additional
improvements placed upon the Project by other Tenants or by Landlord for the
exclusive enjoyment of such other Tenants. Notwithstanding Paragraph 10.2
hereof, Tenant shall, however, pay to Landlord at the time Common Area Operating
Expenses are payable under Paragraph 4.2, the entirety of any increase in Real
Property Taxes if assessed solely by reason of Alterations, Trade Fixtures or
Utility Installations placed upon the Premises by Tenant or at Tenant's
request.
10. 4 Joint Assessment. If the
Building is not separately assessed, Real Property Taxes allocated to the
Building 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 Landlord from the respective valuations assigned
in the assessor's work sheets or such other information as may be reasonably
available. Landlord's reasonable determination thereof, in good faith, shall be
conclusive.
10. 5 Personal Property Taxes.
Tenant shall pay prior to delinquency all taxes assessed against and levied upon
Tenant Owned Alterations and Utility Installations, Trade Fixtures, furnishings,
equipment and all personal property of Tenant contained in the Premises. When
possible, Tenant shall cause its Tenant Owned Alterations and Utility
Installations, Trade Fixtures, furnishings, equipment and all other personal
property to be assessed and billed separately from the real property of
Landlord. If any of Tenant's said property shall be assessed with Landlord's
real property, Tenant shall pay Landlord the taxes attributable to Tenant's
property within 10 days after receipt of a written statement setting forth the
taxes applicable to Tenant's property.
11. Utilities. Tenant shall pay
for all water, gas, heat, light, power, telephone, trash disposal and other
utilities and services supplied to the Premises, together with any taxes
thereon. Notwithstanding the provisions of Paragraph 4.2, if at any time in
Landlord's sole judgment, Landlord determines that Tenant is using a
disproportionate amount of water, electricity or other commonly metered
utilities, or that Tenant is generating such a large volume of trash as to
require an increase in the size of the dumpster and/or an increase in the number
of times per month that the dumpster is emptied, then Landlord may increase
Tenant's Base Rent by an amount equal to such increased costs.
12. Assignment and
Subletting.
12. 1 Landlord's Consent
Required.
(a) Tenant shall not voluntarily or by
operation of law assign, transfer, mortgage or encumber (collectively, "assign or assignment") or
sublet all or any part of Tenant's interest in this Lease or in the Premises
without Landlord's prior written consent.
(b) A change in the control of Tenant
shall constitute an assignment requiring consent. The transfer, on a cumulative
basis, of 25% or more of the voting control of Tenant shall constitute a change
in control for this purpose.
(c) The involvement of Tenant or its
assets in any transaction, or series of transactions (by way of merger, sale,
acquisition, financing, transfer, leveraged buy-out or otherwise), whether or
not a formal assignment or hypothecation of this Lease or Tenant's assets
occurs, which results or will result in a reduction of the Net Worth of Tenant
by an amount greater than 25% of such Net Worth as it was represented at the
time of the execution of this Lease or at the time of the most recent assignment
to which Landlord has consented, or as it exists immediately prior to said
transaction or transactions constituting such reduction, whichever was or is
greater, shall be considered an assignment of this Lease to which Landlord may
withhold its consent. "Net
Worth of Tenant" shall mean the net worth of Tenant (excluding any
guarantors) established under generally accepted accounting
principles.
(d) An assignment or subletting without
consent shall, at Landlord's option, be a Default curable after notice per
Paragraph 13.1(c), or a noncurable Breach without the necessity of any notice
and grace period. If Landlord elects to treat such unapproved assignment or
subletting as a noncurable Breach, Landlord may either: (i) terminate this
Lease, or (ii) upon 30 days written notice, increase the monthly Base Rent to
110% of the Base Rent then in effect. Further, in the event of such Breach and
rental adjustment, (i) the purchase price of any option to purchase the Premises
held by Tenant shall be subject to similar adjustment to 110% of the price
previously in effect, and (ii) all fixed and non-fixed rental adjustments
scheduled during the remainder of the Lease term shall be increased to 110% of
the scheduled adjusted rent.
(e)
Tenant's remedy for any breach of Paragraph 12.1 by Landlord shall be limited to
compensatory damages and/or injunctive relief.
12. 2 Terms and Conditions Applicable to
Assignment and Subletting.
(a) Regardless of Landlord's consent,
no assignment or subletting shall: (i) be effective without the express written
assumption by such assignee or subTenant of the obligations of Tenant under this
Lease, (ii) release Tenant of any obligations hereunder, or (iii) alter the
primary liability of Tenant for the payment of Rent or for the performance of
any other obligations to be performed by Tenant.
(b) Landlord may accept Rent or
performance of Tenant's obligations from any person other than Tenant pending
approval or disapproval of an assignment. Neither a delay in the approval or
disapproval of such assignment nor the acceptance of Rent or performance shall
constitute
a waiver
or estoppel of Landlord's right to exercise its remedies for Tenant's Default or
Breach.
(c) Landlord's consent to any
assignment or subletting shall not constitute a consent to any subsequent
assignment or subletting.
(d) In the event of any Default or
Breach by Tenant, Landlord may proceed directly against Tenant, any Guarantors
or anyone else responsible for the performance of Tenant's obligations under
this Lease, including any assignee or subTenant, without first exhausting
Landlord's remedies against any other person or entity responsible therefore to
Landlord, or any security held by Landlord.
(e) Each request for consent to an
assignment or subletting shall be in writing, accompanied by information
relevant to Landlord's determination as to the financial and operational
responsibility and appropriateness of the proposed assignee or subTenant,
including but not limited to the intended use and/or required modification of
the Premises, if any, together with a fee of $1,000 or 10% of the current
monthly Base Rent applicable to the portion of the Premises which is the subject
of the proposed assignment or sublease, whichever is greater, as consideration
for Landlord's considering and processing said request. Tenant agrees to provide
Landlord with such other or additional information and/or documentation as may
be reasonably requested.
(f) Any assignee of, or subTenant
under, this Lease shall, by reason of accepting such assignment or entering into
such sublease, be deemed to have assumed and agreed to conform and comply with
each and every term, covenant, condition and obligation herein to be observed or
performed by Tenant during the term of said assignment or sublease, other than
such obligations as are contrary to or inconsistent with provisions of an
assignment or sublease to which Landlord has specifically consented to in
writing.
(g) Landlord's consent to any
assignment or subletting shall not transfer to the assignee or subTenant any
Option granted to the original Tenant by this Lease unless such transfer is
specifically consented to by Landlord in writing. (See Paragraph
39.2)
12. 3 Additional Terms and Conditions
Applicable to Subletting. The following terms and conditions shall apply
to any subletting by Tenant of all or any part of the Premises and shall be
deemed included in all subleases under this Lease whether or not expressly
incorporated therein:
(a) Tenant hereby assigns and transfers
to Landlord all of Tenant's interest in all Rent payable on any sublease, and
Landlord may collect such Rent and apply same toward Tenant's obligations under
this Lease; provided, however, that until a Breach shall occur in the
performance of Tenant's obligations, Tenant may collect said Rent. Landlord
shall not, by reason of the foregoing or any assignment of such sublease, nor by
reason of the collection of Rent, be deemed liable to the subTenant for any
failure of Tenant to perform and comply with any of Tenant's obligations to such
subTenant. Tenant hereby irrevocably authorizes and directs any such subTenant,
upon receipt of a written notice from Landlord stating that a Breach exists in
the performance of Tenant's obligations under this Lease, to pay to Landlord all
Rent due and to become due under the sublease. SubTenant shall rely upon any
such notice from Landlord and shall pay all Rents to Landlord without any
obligation or right to inquire as to whether such Breach exists, notwithstanding
any claim from Tenant to the contrary.
(b) In the event of a Breach by Tenant,
Landlord may, at its option, require subTenant to attorn to Landlord, in which
event Landlord shall undertake the obligations of the subLandlord under such
sublease from the time of the exercise of said option to the expiration of such
sublease; provided, however, Landlord shall not be liable for any prepaid rents
or security deposit paid by such subTenant to such subLandlord or for any prior
Defaults or Breaches of such subLandlord.
(c) Any matter requiring the consent of
the subLandlord under a sublease shall also require the consent of
Landlord.
(d) No subTenant shall further assign
or sublet all or any part of the Premises without Landlord's prior written
consent.
(e) Landlord shall deliver a copy of
any notice of Default or Breach by Tenant to the subTenant, who shall have the
right to cure the Default of Tenant within the grace period, if any, specified
in such notice. The subTenant shall have a right of reimbursement and offset
from and against Tenant for any such Defaults cured by the
subTenant.
13. Default; Breach;
Remedies.
13. 1 Default; Breach. A "Default" is defined as a
failure by the Tenant to comply with or perform any of the terms, covenants,
conditions or Rules and Regulations under this Lease. A "Breach" is defined as the
occurrence of one or more of the following Defaults, and the failure of Tenant
to cure such Default within any applicable grace period:
(a) The abandonment of the Premises; or
the vacating of the Premises without providing a commercially reasonable level
of
security,
or where the coverage of the property insurance described in Paragraph 8.3 is
jeopardized as a result thereof, or without providing reasonable
assurances
to minimize potential vandalism.
(b) The failure of Tenant to make any
payment of Rent or any Security Deposit required to be made by Tenant hereunder,
whether to Landlord or to a third party, when due, to provide reasonable
evidence of insurance or surety bond, or to fulfill any obligation under this
Lease which endangers or threatens life or property, where such failure
continues for a period of 3 business days following written notice to
Tenant.
(c) The failure by Tenant to provide
(i) reasonable written evidence of compliance with Applicable Requirements, (ii)
the service contracts, (iii) the rescission of an unauthorized assignment or
subletting, (iv) an Estoppel Certificate, (v) a requested subordination, (vi)
evidence concerning any guaranty and/or Guarantor, (vii) any document requested
under Paragraph 41 (easements), or (viii) any other documentation or information
which Landlord may reasonably require of Tenant under the terms of this Lease,
where any such failure continues for a period of 10 days following written
notice to Tenant.
(d) A Default by Tenant as to the
terms, covenants, conditions or provisions of this Lease, or of the rules
adopted under Paragraph 2.9 hereof, other than those described in subparagraphs
13.1(a), (b) or (c), above, where such Default continues for a period of 30 days
after written notice; provided, however, that if the nature of Tenant's Default
is such that more than 30 days are reasonably required for its cure, then it
shall not be deemed to be a Breach if Tenant commences such cure within said 30
day period and thereafter diligently prosecutes such cure to
completion.
(e) The occurrence of any of the
following events: (i) the making of any general arrangement or assignment for
the benefit of creditors; (ii) becoming a "debtor" as defined in 11
U.S.C. § 101 or any
successor statute thereto (unless, in the case of a petition filed against
Tenant, the same is dismissed within 60 days); (iii) the appointment of a
trustee or receiver to take possession of substantially all of Tenant's assets
located at the Premises or of Tenant's interest in this Lease, where possession
is not restored to Tenant within 30 days; or (iv) the attachment, execution or
other judicial seizure of substantially all of Tenant's assets located at the
Premises or of Tenant's interest in this Lease, where such seizure is not
discharged within 30 days; provided, however, in the event that any provision of
this subparagraph (e) is contrary to any applicable law, such provision shall be
of no force or effect, and not affect the validity of the remaining
provisions.
(f) The discovery that any financial
statement of Tenant or of any Guarantor given to Landlord was materially
false.
(g) If the performance of Tenant's
obligations under this Lease is guaranteed: (i) the death of a Guarantor, (ii)
the termination of a Guarantor's liability with respect to this Lease other than
in accordance with the terms of such guaranty, (iii) a Guarantor's becoming
insolvent or the subject of a bankruptcy filing, (iv) a Guarantor's refusal to
honor the guaranty, or (v) a Guarantor's breach of its guaranty obligation on an
anticipatory basis, and Tenant's failure, within 60 days following written
notice of any such event, to provide written alternative assurance or security,
which, when coupled with the then existing resources of Tenant, equals or
exceeds the combined financial resources of Tenant and the Guarantors that
existed at the time of execution of this Lease.
13.2 Remedies. If Tenant fails to
perform any of its affirmative duties or obligations, within 10 days after
written notice (or in case of an emergency, without notice), Landlord may, at
its option, perform such duty or obligation on Tenant's behalf, including but
not limited to the obtaining of reasonably required bonds, insurance policies,
or governmental licenses, permits or approvals. The costs and expenses of any
such performance by Landlord shall be due and payable by Tenant upon receipt of
invoice therefor. If any check given to Landlord by Tenant shall not be honored
by the bank upon which it is drawn, Landlord, at its option, may require all
future payments to be made by Tenant to be by cashier's check. In the event of a
Breach, Landlord may, with or without further notice or demand, and without
limiting Landlord in the exercise of any right or remedy which Landlord may have
by reason of such Breach:
(a) Terminate Tenant's right to
possession of the Premises by any lawful means, in which case this Lease shall
terminate and Tenant shall immediately surrender possession to Landlord. In such
event Landlord shall be entitled to recover from Tenant: (i) 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 Tenant 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 Tenant
proves could be reasonably avoided; and (iv) any other amount necessary to
compensate Landlord for all the detriment proximately caused by the Tenant'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 any leasing commission paid by Landlord in
connection with this Lease applicable to the unexpired term of this Lease. The
worth at the time of award of the amount referred to in provision (iii) of the
immediately preceding sentence shall be computed by discounting such amount at
the discount rate of the Federal Reserve Bank of the District within which the
Premises are located at the time of award plus one percent. Efforts by Landlord
to mitigate damages caused by Tenant's Breach of this Lease shall not waive
Landlord's right to recover damages under Paragraph 12. If termination of this
Lease is obtained through the provisional remedy of unlawful detainer, Landlord
shall have the right to recover in such proceeding any unpaid Rent and damages
as are recoverable therein, or Landlord may reserve the right to recover all or
any part thereof in a separate suit. If a notice and grace period required under
Paragraph 13.1 was not previously given, a notice to pay rent or quit, or to
perform or quit given to Tenant under the unlawful detainer statute shall also
constitute the notice required by Paragraph 13.1. In such case, the applicable
grace period required by Paragraph 13.1 and the unlawful detainer statute shall
run concurrently, and the failure of Tenant to cure the Default within the
greater of the two such grace periods shall constitute both an unlawful detainer
and a Breach of this Lease entitling Landlord to the remedies provided for in
this Lease and/or by said statute.
(b) Continue the Lease and Tenant's
right to possession and recover the Rent as it becomes due, in which event
Tenant may sublet or assign, subject only to reasonable limitations. Acts of
maintenance, efforts to relet, and/or the appointment of a receiver to protect
the Landlord's interests, shall not constitute a termination of the Tenant's
right to possession.
(c) Pursue any other remedy now or
hereafter available under the laws or judicial decisions of the state wherein
the Premises are located. The expiration or termination of this Lease and/or the
termination of Tenant's right to possession shall not relieve Tenant from
liability under any indemnity provisions of this Lease as to matters occurring
or accruing during the term hereof or by reason of Tenant's occupancy of the
Premises.
13.3 Inducement Recapture. Any
agreement for free or abated rent or other charges, or for the giving or paying
by Landlord to or for Tenant of any cash or other bonus, inducement or
consideration for Tenant's entering into this Lease, all of which concessions
are hereinafter referred to as "Inducement Provisions", shall
be deemed conditioned upon Tenant's full and faithful performance of all of the
terms, covenants and conditions of this Lease. Upon Breach of this Lease by
Tenant, any such Inducement Provision shall automatically be deemed deleted from
this Lease and of no further force or effect, and any rent, other charge, bonus,
inducement or consideration theretofore abated, given or paid by Landlord under
such an Inducement Provision shall be immediately due and payable by Tenant to
Landlord, notwithstanding any subsequent cure of said Breach by Tenant. The
acceptance by Landlord of rent or the cure of the Breach which initiated the
operation of this paragraph shall not be deemed a waiver by Landlord of the
provisions of this paragraph unless specifically so stated in writing by
Landlord at the time of such acceptance.
13.4 Late Charges. Tenant hereby
acknowledges that late payment by Tenant of Rent will cause Landlord to incur
costs not contemplated by this Lease, the exact amount of which will be
extremely difficult to ascertain. Such costs include, but are not limited to,
processing and accounting charges, and late charges which may be imposed upon
Landlord by any Lender. Accordingly, if any Rent shall not be received by
Landlord within 5 days after such amount shall be due, then, without any
requirement for notice to Tenant, Tenant shall pay to Landlord a one-time late
charge equal to 10% of each such overdue amount or $100, whichever is greater.
The parties hereby agree that such late charge represents a fair and reasonable
estimate of the costs Landlord will incur by reason of such late payment.
Acceptance of such late charge by Landlord shall in no event constitute a waiver
of Tenant's Default or Breach with respect to such overdue amount, nor prevent
the exercise of any of the other rights and remedies granted hereunder. In the
event that a late charge is payable hereunder, whether or not collected, for 3
consecutive installments of Base Rent, then notwithstanding any provision of
this Lease to the contrary, Base Rent shall, at Landlord's option, become due
and payable quarterly in advance.
13.5 Interest. Any monetary payment
due Landlord hereunder, other than late charges, not received by Landlord, when
due as to scheduled payments (such as Base Rent) or within 30 days following the
date on which it was due for non-scheduled payment, shall bear interest from the
date when due, as to scheduled payments, or the 31st day after it was due as to
non-scheduled payments. The interest ("Interest") charged shall be
equal to the prime rate reported in the Wall Street Journal as published closest
prior to the date when due plus 4%, but shall not exceed the maximum rate
allowed by law. Interest is payable in addition to the potential late charge
provided for in Paragraph 13.4.
13.6 Breach by
Landlord.
(a) Notice of Breach. Landlord
shall not be deemed in breach of this Lease unless Landlord fails within a
reasonable time to perform an obligation required to be performed by Landlord.
For purposes of this Paragraph, a reasonable time shall in no event be less than
30 days after receipt by Landlord, and any Lender whose name and address shall
have been furnished Tenant in writing for such purpose, of written notice
specifying wherein such obligation of Landlord has not been performed; provided,
however, that if the nature of Landlord's obligation is such that more than 30
days are reasonably required for its performance, then Landlord shall not be in
breach if performance is commenced within such 30 day period and thereafter
diligently pursued to completion.
(b) Performance by Tenant on Behalf of
Landlord. In the event that neither Landlord nor Lender cures said breach
within 30 days after receipt of said notice, or if having commenced said cure
they do not diligently pursue it to completion, then Tenant may elect to cure
said breach at Tenant's expense and offset from Rent an amount equal to the
greater of one month's Base Rent or the Security Deposit, and to pay an excess
of such expense under protest, reserving Tenant's right to reimbursement from
Landlord. Tenant shall document the cost of said cure and supply said
documentation to Landlord.
14. Condemnation. If the Premises
or any portion thereof are taken under the power of eminent domain or sold under
the threat of the exercise of said power (collectively "Condemnation"), this Lease
shall terminate as to the part taken as of the date the condemning authority
takes title or possession, whichever first occurs. If more than 10% of the floor
area of the Unit, or more than 25% of Tenant's Reserved Parking Spaces, is taken
by Condemnation, Tenant may, at Tenant's option, to be exercised in writing
within 10 days after Landlord shall have given Tenant written notice of such
taking (or in the absence of such notice, within 10 days after the condemning
authority shall have taken possession) terminate this Lease as of the date the
condemning authority takes such possession. If Tenant 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 Base
Rent shall be reduced in proportion to the reduction in utility of the Premises
caused by such Condemnation. Condemnation awards and/or payments shall be the
property of Landlord, whether such award shall be made as compensation for
diminution in value of the leasehold, the value of the part taken, or for
severance damages; provided, however, that Tenant shall be entitled to any
compensation for Tenant's relocation expenses, loss of business goodwill and/or
Trade Fixtures, without regard to whether or not this Lease is terminated
pursuant to the provisions of this Paragraph. All Alterations and Utility
Installations made to the Premises by Tenant, for purposes of Condemnation only,
shall be considered the property of the Tenant and Tenant shall be entitled to
any and all compensation which is payable therefor. In the event that this Lease
is not terminated by reason of the Condemnation, Landlord shall repair any
damage to the Premises caused by such Condemnation.
15. Brokerage Fees.
15.1 Additional Commission. In
addition to the payments owed pursuant to Paragraph 1.10 above, and unless
Landlord and the Brokers otherwise agree in writing, Landlord agrees that: (a)
if Tenant exercises any Option, (b) if Tenant acquires from Landlord any rights
to the Premises or other premises owned by Landlord and located within the
Project, (c) if Tenant remains in possession of the Premises, with the consent
of Landlord, after the expiration of this Lease, or (d) if Base Rent is
increased, whether by agreement or operation of an escalation clause herein,
then, Landlord shall pay Brokers a fee in accordance with the schedule of the
Brokers in effect at the time of the execution of this Lease.
15.2 Assumption of Obligations. Any
buyer or transferee of Landlord's interest in this Lease shall be deemed to have
assumed Landlord's obligation hereunder. Brokers shall be third party
beneficiaries of the provisions of Paragraphs 1.10, 15, 22 and 31. If Landlord
fails to pay to Brokers any amounts due as and for brokerage fees pertaining to
this Lease when due, then such amounts shall accrue Interest. In addition, if
Landlord fails to pay any amounts to Tenant's Broker when due, Tenant's Broker
may send written notice to Landlord and Tenant of such failure and if Landlord
fails to pay such amounts within 10 days after said notice, Tenant shall pay
said monies to its Broker and offset such amounts against Rent. In addition,
Tenant's Broker shall be deemed to be a third party beneficiary of any
commission agreement entered into by and/or between Landlord and Landlord's
Broker for the limited purpose of collecting any brokerage fee
owed.
15.3 Representations and Indemnities of
Broker Relationships. Tenant and Landlord each represent and warrant to
the other that it has had no dealings with any person, firm, broker or finder
(other than the Brokers, if any) in connection with this Lease, and that no one
other than said named Brokers is entitled to any commission or finder's fee in
connection herewith. Tenant and Landlord do each hereby agree to indemnify,
protect, defend and hold the other harmless from and against liability for
compensation 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, including any costs, expenses, attorneys' fees reasonably incurred with
respect thereto.
16. Estoppel
Certificates.
(a) Each Party (as "Responding Party") shall
within 10 days after written notice from the other Party (the "Requesting Party") execute,
acknowledge and deliver to the Requesting Party a statement in writing in form
similar to the then most current "Estoppel Certificate" form
published by the American Industrial Real Estate Association, plus such
additional information, confirmation and/or statements as may be reasonably
requested by the Requesting Party.
(b) If the Responding Party shall fail
to execute or deliver the Estoppel Certificate within such 10 day period, the
Requesting Party may execute an Estoppel Certificate stating that: (i) the 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 Landlord is the Requesting Party, not more
than one month's rent has been paid in advance. Prospective purchasers and
encumbrances may rely upon the Requesting Party's Estoppel Certificate, and the
Responding Party shall be estopped from denying the truth of the facts contained
in said Certificate.
(c) If Landlord desires to finance,
refinance, or sell the Premises, or any part thereof, Tenant and all Guarantors
shall deliver to any potential lender or purchaser designated by Landlord such
financial statements as may be reasonably required by such lender or purchaser,
including but not limited to Tenant's financial statements for the past 3 years.
All such financial statements shall be received by Landlord and such lender or
purchaser in confidence and shall be used only for the purposes herein set
forth.
17. Definition of Landlord. The
term "Landlord," as used in this Lease, so far as covenants or obligations on
the part of Landlord are concerned, means and includes only the owner or owners,
at the time in question, of the fee title of the Premises or the Tenants under
any ground lease, if any. In the event of any transfer, assignment or other
conveyance or transfers of any such title (other than a transfer for security
purposes only), Landlord herein named (and in case of any subsequent transfers
or conveyances, the then grantor) will be automatically relieved from and after
the date of such transfer, assignment or conveyance of all liability as respects
the performance of any covenants or obligations on the part of Landlord
contained in this Lease thereafter to be performed, so long as the transferee
assumes in writing all such covenants and obligations of Landlord arising after
the date of such transfer. Landlord and Landlord's transferees and assignees
have the absolute right to transfer all or any portion of their respective title
and interest in the Industrial Project, the Building, the Premises and or this
Lease without the consent of Tenant, and such transfer or subsequent transfer
will not be deemed a violation on Landlord's part of any of the terms and
conditions of this Lease.
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. Days. Unless otherwise
specifically indicated to the contrary, the word "days" as used in this Lease
shall mean and refer to calendar days.
20. Limitation on Landlord
Liability. Notwithstanding anything in this Lease to the contrary, and in
consideration of the benefits accruing hereunder to Tenant, Tenant on behalf of
itself and all successors and assigns of Tenant covenants and agrees that, in
the event of any actual or alleged failure, breach, claim, damage, cause of
action or obligation or default hereunder by Landlord: (a) Tenant's recourse
against Landlord for monetary damages will be limited to Landlord's interest in
the Building including, subject to the prior rights of any Mortgagee, Landlord's
interest in the rents of the Building and any insurance proceeds payable to
Landlord; (b) except as may be necessary to secure jurisdiction of a partnership
or limited liability company, no partner, investor, trustee, director, officer,
employee, agent, shareholder, advisor, manager, or member of Landlord
(collectively referred to as “Landlord Party”) shall be sued or named as a party
in any suit or action and no service of process shall be made against any
Landlord Party; (c) no Landlord Party shall be required to answer or otherwise
plead to any service of process; (d) no judgment will be taken against any
Landlord Party and any judgment taken against any Landlord Party may
be vacated and set aside at any time after the fact; (e) no writ of execution
will be levied against the assets of any Landlord Party; (f) the obligations
under this Lease do not constitute personal obligations of the individual
Landlord Party, and Tenant shall not seek recourse against the individual
Landlord Party or any of their personal assets for satisfaction of any liability
in respect to this Lease; and (g) these covenants and agreements are enforceable
both by Landlord and also by any Landlord Party.
21. Time of Essence. Time is of
the essence with respect to the performance of all obligations to be performed
or observed by the Parties under this Lease.
22. No Prior or Other Agreements; Broker
Disclaimer. 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,
Tenant hereby acknowledges that neither the real estate broker listed in
Paragraph 1.10 hereof nor any cooperating broker on this transaction nor the
Landlord or any employee or agents of any of said person has made any oral or
written warranties or representations to Tenant relative to the condition or use
by Tenant of the Premises or the Industrial Project and Tenant acknowledges that
Tenant 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.
23. Notices.
23.1 Notice Requirements. All
notices required or permitted by this Lease or applicable law shall be in
writing and may be delivered in person (by hand or by courier) or may be sent by
regular, certified or registered mail or U.S. Postal Service Express Mail, with
postage prepaid, or by facsimile transmission, and shall be deemed sufficiently
given if served in a manner specified in this Paragraph 23. The addresses noted
adjacent to a Party's signature on this Lease shall be that Party's address for
delivery or mailing of notices. Either Party may by written notice to the other
specify a different address for notice, except that upon Tenant's taking
possession of the Premises, the Premises shall constitute Tenant's address for
notice. A copy of all notices to Landlord shall be concurrently transmitted to
such party or parties at such addresses as Landlord may from time to time
hereafter designate in writing.
23.2 Date of Notice. Any notice
sent by registered or certified mail, return receipt requested, shall be deemed
given on the date of delivery shown on the receipt card, or if no delivery date
is shown, the postmark thereon. If sent by regular mail the notice shall be
deemed given 48 hours after the same is addressed as required herein and mailed
with postage prepaid. Notices delivered by United States Express Mail or
overnight courier that guarantee next day delivery shall be deemed given 24
hours after delivery of the same to the Postal Service or courier. Notices
transmitted by facsimile transmission or similar means shall be deemed delivered
upon telephone confirmation of receipt (confirmation report from fax machine is
sufficient), provided a copy is also delivered via delivery or mail. If notice
is received on a Saturday, Sunday or legal holiday, it shall be deemed received
on the next business day.
24. Waivers. No waiver by Landlord
of the Default or Breach of any term, covenant or condition hereof by Tenant,
shall be deemed a waiver of any other term, covenant or condition hereof, or of
any subsequent Default or Breach by Tenant of the same or of any other term,
covenant or condition hereof. Landlord's consent to, or approval of, any act
shall not be deemed to render unnecessary the obtaining of Landlord's consent
to, or approval of, any subsequent or similar act by Tenant, or be construed as
the basis of an estoppel to enforce the provision or provisions of this Lease
requiring such consent. The acceptance of Rent by Landlord shall not be a waiver
of any Default or Breach by Tenant. Any payment by Tenant may be accepted by
Landlord on account of moneys or damages due Landlord, notwithstanding any
qualifying statements or conditions made by Tenant in connection therewith,
which such statements and/or conditions shall be of no force or effect
whatsoever unless specifically agreed to in writing by Landlord at or before the
time of deposit of such payment.
25. Disclosures Regarding The Nature of a
Real Estate Agency Relationship.
(a) When entering into a discussion
with a real estate agent regarding a real estate transaction, a Landlord or
Tenant should from the outset understand what type of agency relationship or
representation it has with the agent or agents in the transaction. Landlord and
Tenant acknowledge being advised by the Brokers in this transaction, as
follows:
(i) Landlord's Agent. A Landlord's
agent under a listing agreement with the Landlord acts as the agent for the
Landlord only. A Landlord's agent or subagent has the following affirmative
obligations: To the Landlord: A fiduciary duty of utmost care, integrity,
honesty, and loyalty in dealings with the Landlord. To the Tenant and the
Landlord: (a) Diligent exercise of reasonable skills and care in performance of
the agent's duties. (b) A duty of honest and fair dealing and good faith. (c) A
duty to disclose all facts known to the agent materially affecting the value or
desirability of the property that are not known to, or within the diligent
attention and observation of, the Parties. An agent is not obligated to reveal
to either Party any confidential information obtained from the other Party which
does not involve the affirmative duties set forth above.
(ii) Tenant's Agent. An agent can agree
to act as agent for the Tenant only. In these situations, the agent is not the
Landlord's agent, even if by agreement the agent may receive compensation for
services rendered, either in full or in part from the Landlord. An agent acting
only for a Tenant has the following affirmative obligations. To the Tenant: A
fiduciary duty of utmost care, integrity, honesty, and loyalty in dealings with
the Tenant. To the Tenant and the Landlord: (a) Diligent exercise of reasonable
skills and care in performance of the agent's duties. (b) A duty of honest and
fair dealing and good faith. (c) A duty to disclose all facts known to the agent
materially affecting the value or desirability of the property that are not
known to, or within the diligent attention and observation of, the Parties. An
agent is not obligated to reveal to either Party any confidential information
obtained from the other Party which does not involve the affirmative duties set
forth above.
(iii) Agent Representing Both Landlord
and Tenant. A real estate agent, either acting directly or through one or more
associate licenses, can legally be the agent of both the Landlord and the Tenant
in a transaction, but only with the knowledge and consent of both the Landlord
and the Tenant. In a dual agency situation, the agent has the following
affirmative obligations to both the Landlord and the Tenant: (a) A fiduciary
duty of utmost care, integrity, honesty and loyalty in the dealings with either
Landlord or the Tenant. (b) Other duties to the Landlord and the Tenant as
stated above in subparagraphs (i) or (ii). In representing both Landlord and
Tenant, the agent may not without the express permission of the respective
Party, disclose to the other Party that the Landlord will accept rent in an
amount less than that indicated in the listing or that the Tenant is willing to
pay a higher rent than that offered. The above duties of the agent in a real
estate transaction do not relieve a Landlord or Tenant from the responsibility
to protect their own interests. Landlord and Tenant should carefully read all
agreements to assure that they adequately express their understanding of the
transaction. A real estate agent is a person qualified to advise about real
estate. If legal or tax advice is desired, consult a competent
professional.
(b) Brokers have no responsibility with
respect to any default or breach hereof by either Party. The liability
(including court costs and attorneys' fees), of any Broker with respect to any
breach of duty, error or omission relating to this Lease shall not exceed the
fee received by such Broker pursuant to this Lease; provided, however, that the
foregoing limitation on each Broker's liability shall not be applicable to any
gross negligence or willful misconduct of such Broker.
(c) Buyer and Seller agree to identify
to Brokers as "Confidential" any communication or information given Brokers that
is considered by such Party to be confidential.
26. No Right To Holdover. Tenant
has no right to retain possession of the Premises or any part thereof beyond the
expiration or termination of this Lease. In the event that Tenant holds over,
then the Base Rent shall be increased to 150% of the Base Rent applicable
immediately preceding the expiration or termination. Nothing contained herein
shall be construed as consent by Landlord to any holding over by
Tenant.
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.
28. Covenants and Conditions;
Construction of Agreement. All provisions of this Lease to be observed or
performed by Tenant are both covenants and conditions. In construing this Lease,
all headings and titles are for the convenience of the Parties only and shall
not be considered a part of this Lease. Whenever required by the context, the
singular shall include the plural and vice versa. This Lease shall not be
construed as if prepared by one of the Parties, but rather according to its fair
meaning as a whole, as if both Parties had prepared it.
29. Binding Effect; Choice of Law.
This Lease shall be binding upon the parties, their personal representatives,
successors and assigns and be governed by the laws of the State in which the
Premises are located. Any litigation between the Parties hereto concerning this
Lease shall be initiated in the county in which the Premises are
located.
30. Subordination; Attornment;
Non-Disturbance.
30.1 Subordination. This Lease and
any Option granted hereby shall be subject and subordinate to any ground lease,
mortgage, deed of trust, or other hypothecation or security device
(collectively, "Security
Device"), now or hereafter placed upon the Premises, to any and all
advances made on the security thereof, and to all renewals, modifications, and
extensions thereof. Tenant agrees that the holders of any such Security Devices
(in this Lease together referred to as "Lender") shall have no
liability or obligation to perform any of the obligations of Landlord under this
Lease. Any Lender may elect to have this Lease and/or any Option granted hereby
superior to the lien of its Security Device by giving written notice thereof to
Tenant, whereupon this Lease and such Options shall be deemed prior to such
Security Device, notwithstanding the relative dates of the documentation or
recordation thereof.
30.2 Attornment. In the event that
Landlord transfers title to the Premises, or the Premises are acquired by
another upon the foreclosure or termination of a Security Device to which this
Lease is subordinated (i) Tenant shall, subject to the non-disturbance
provisions of Paragraph 30.3, attorn to such new owner, and upon request, enter
into a new lease, containing all of the terms and provisions of this Lease, with
such new owner for the remainder of the term hereof, or, at the election of such
new owner, this Lease shall automatically become a new Lease between Tenant and
such new owner, upon all of the terms and conditions hereof, for the remainder
of the term hereof, and (ii) Landlord shall thereafter be relieved of any
further obligations hereunder and such new owner shall assume all of Landlord's
obligations hereunder, except that such new owner shall not: (a) be liable for
any act or omission of any prior Landlord or with respect to events occurring
prior to acquisition of ownership; (b) be subject to any offsets or defenses
which Tenant might have against any prior Landlord, (c) be bound by prepayment
of more than one month's rent, or (d) be liable for the return of any security
deposit paid to any prior Landlord.
30.3 Non-Disturbance. With respect
to Security Devices entered into by Landlord after the execution of this Lease,
Tenant's subordination of this Lease shall be subject to receiving a
commercially reasonable non-disturbance agreement (a "Non-Disturbance Agreement")
from the Lender which Non-Disturbance Agreement provides that Tenant's
possession of the Premises, and this Lease, including any options to extend the
term hereof, will not be disturbed so long as Tenant is not in Breach hereof and
attorns to the record owner of the Premises. Further, within 60 days after the
execution of this Lease, Landlord shall use its commercially reasonable efforts
to obtain a Non-Disturbance Agreement from the holder of any pre-existing
Security Device which is secured by the Premises. In the event that Landlord is
unable to provide the Non-Disturbance Agreement within said 60 days, then Tenant
may, at Tenant's option, directly contact Lender and attempt to negotiate for
the execution and delivery of a Non-Disturbance Agreement.
30.4 Self-Executing. The agreements
contained in this Paragraph 30 shall be effective without the execution of any
further documents; provided, however, that, upon written request from Landlord
or a Lender in connection with a sale, financing or refinancing of the Premises,
Tenant and Landlord shall execute such further writings as may be reasonably
required to separately document any subordination, attornment and/or
Non-Disturbance Agreement provided for herein.
31. Attorneys' Fees. If any Party
or Broker brings an action or proceeding involving the Premises whether founded
in tort, contract or equity, or to declare rights hereunder, the Prevailing
Party (as hereafter defined) in any such proceeding, action, or appeal thereon,
shall be entitled to reasonable attorneys' fees. Such fees 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 judgment. The term, "Prevailing Party" shall
include, without limitation, a Party or Broker who substantially obtains or
defeats the relief sought, as the case may be, whether by compromise,
settlement, judgment, or the abandonment by the other Party or Broker of its
claim or defense. The attorneys' fees award shall not be computed in accordance
with any court fee schedule, but shall be such as to fully reimburse all
attorneys' fees reasonably incurred. In addition, Landlord shall be entitled to
attorneys' 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 or
resulting Breach ($200 is a reasonable minimum per occurrence for such services
and consultation).
32. Landlord's Access; Showing Premises;
Repairs. Landlord and Landlord's agents shall have the right to enter the
Premises at any time, in the case of an emergency, and otherwise at reasonable
times for the purpose of showing the same to prospective purchasers, lenders, or
tenants, and making such alterations, repairs, improvements or additions to the
Premises as Landlord may deem necessary. All such activities shall be without
abatement of rent or liability to Tenant. Landlord may at any time place on the
Premises any ordinary "For
Sale" signs and Landlord may during the last 6 months of the term hereof
place on the Premises any ordinary "For Lease" signs. Tenant may
at any time place on the Premises any ordinary "For Sublease"
sign.
33. Auctions. Tenant shall not
conduct, nor permit to be conducted, any auction upon the Premises without
Landlord's prior written consent. Landlord shall not be obligated to exercise
any standard of reasonableness in determining whether to permit an
auction.
34. Signs. Except for ordinary
"For Sublease" signs which may be placed only on the Premises, Tenant shall not
place any sign upon the Project without Landlord's prior written consent. All
signs must comply with all provisions as contained in Exhibit “B” attached
hereto and made a part hereof by this reference.
35. Termination; Merger. Unless
specifically stated otherwise in writing by Landlord, the voluntary or other
surrender of this Lease by Tenant, the mutual termination or cancellation
hereof, or a termination hereof by Landlord for Breach by Tenant, shall
automatically terminate any sublease or lesser estate in the Premises; provided,
however, that Landlord may elect to continue any one or all existing
subtenancies. Landlord's failure within 10 days following any such event to
elect to the contrary by written notice to the holder of any such lesser
interest, shall constitute Landlord's election to have such event constitute the
termination of such interest.
36. Consents. Except as otherwise
provided herein, wherever in this Lease the consent of a Party is required to an
act by or for the other Party, such consent shall not be unreasonably withheld
or delayed. Landlord's actual reasonable costs and expenses (including but not
limited to architects', attorneys', engineers' and other consultants' fees)
incurred in the consideration of, or response to, a request by Tenant for any
Landlord consent, including but not limited to consents to an assignment, a
subletting or the presence or use of a Hazardous Substance, shall be paid by
Tenant upon receipt of an invoice and supporting documentation therefor.
Landlord's consent to any act, assignment or subletting shall not constitute an
acknowledgment that no Default or Breach by Tenant of this Lease exists, nor
shall such consent be deemed a waiver of any then existing Default or Breach,
except as may be otherwise specifically stated in writing by Landlord at the
time of such consent. The failure to specify herein any particular condition to
Landlord's consent shall not preclude the imposition by Landlord at the time of
consent of such further or other conditions as are then reasonable with
reference to the particular matter for which consent is being given. In the
event that either Party disagrees with any determination made by the other
hereunder and reasonably requests the reasons for such determination, the
determining party shall furnish its reasons in writing and in reasonable detail
within 10 business days following such request.
37. Guarantor.
37.1 Execution. The Guarantors, if
any, shall each execute a guaranty in the form most recently published by the
American Industrial Real Estate Association, and each such Guarantor shall have
the same obligations as Tenant under this Lease.
37.2 Default. It shall constitute a
Default of the Tenant if any Guarantor fails or refuses, upon request to
provide: (a) evidence of the execution of the guaranty, including the authority
of the party signing on Guarantor's behalf to obligate Guarantor, and in the
case of a corporate Guarantor, a certified copy of a resolution of its board of
directors authorizing the making of such guaranty, (b) current financial
statements, (c) an Estoppel Certificate, or (d) written confirmation that the
guaranty is still in effect.
38. Quiet Possession. Subject to
payment by Tenant of the Rent and performance of all of the covenants,
conditions and provisions on Tenant's part to be observed and performed under
this Lease, Tenant shall have quiet possession and quiet enjoyment of the
Premises during the term hereof.
39. Options. If Tenant is granted
an option, as defined below, then the following provisions shall
apply.
39. 1 Definition. "Option" shall mean: (a) the
right to extend the term of or renew this Lease or to extend or renew any lease
that Tenant has on other property of Landlord; (b) the right of first refusal or
first offer to lease either the Premises or other property of Landlord; (c) the
right to purchase or the right of first refusal to purchase the Premises or
other property of Landlord.
39. 2 Options Personal To Original
Tenant. Any Option granted to Tenant in this Lease is personal to the
original Tenant, and cannot be assigned or exercised by anyone other than said
original Tenant and only while the original Tenant is in full possession of the
Premises and, if requested by Landlord, with Tenant certifying that Tenant has
no intention of thereafter assigning or subletting.
39.3 Multiple Options. In the event
that Tenant has any multiple Options to extend or renew this Lease, a later
Option cannot be exercised unless the prior Options have been validly
exercised.
39. 4 Effect of Default on
Options.
(a) Tenant shall have no right to
exercise an Option: (i) during the period commencing with the giving of any
notice of Default and continuing until said Default is cured, (ii) during the
period of time any Rent is unpaid (without regard to whether notice thereof is
given Tenant), (iii) during the time Tenant is in Breach of this Lease, or (iv)
in the event that Tenant has been given 3 or more notices of separate Default,
whether or not the Defaults are cured, during the 12 month period immediately
preceding the exercise of the Option.
(b) The period of time within which an
Option may be exercised shall not be extended or enlarged by reason of Tenant's
inability to
exercise
an Option because of the provisions of Paragraph 39.4(a).
(c) An Option shall terminate and be of
no further force or effect, notwithstanding Tenant's due and timely exercise of
the Option, if, after such exercise and prior to the commencement of the
extended term, (i) Tenant fails to pay Rent for a period of 30 days after such
Rent becomes due (without any necessity of Landlord to give notice thereof),
(ii) Landlord gives to Tenant 3 or more notices of separate Default during any
12 month period, whether or not the Defaults are cured, or (iii) if Tenant
commits a Breach of this Lease.
40. Security Measures. Tenant
hereby acknowledges that the Rent payable to Landlord hereunder does not include
the cost of guard service or other security measures, and that Landlord shall
have no obligation whatsoever to provide same. Tenant assumes all responsibility
for the protection of the Premises, Tenant, its agents and invitees and their
property from the acts of third parties.
41. Reservations. Landlord
reserves the right: (i) to grant, without the consent or joinder of Tenant, such
easements, rights and dedications that Landlord deems necessary, (ii) to cause
the recordation of parcel maps and restrictions, and (iii) to create and/or
install new utility raceways, so long as such easements, rights, dedications,
maps, restrictions, and utility raceways do not unreasonably interfere with the
use of the Premises by Tenant. Tenant agrees to sign any documents reasonably
requested by Landlord to effectuate such rights.
42. Performance Under Protest. If
at any time 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.
43. Authority. If either Party
hereto is a corporation, trust, limited liability company, partnership, or
similar entity, 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 its behalf. Each party shall, within 30 days after request,
deliver to the other party satisfactory evidence of such authority.
44. Conflict. Any conflict between
the printed provisions of this Lease and the typewritten or handwritten
provisions shall be controlled by the typewritten or handwritten
provisions.
45. Offer. Preparation of this
Lease by either party or their agent and submission of same to the other Party
shall not be deemed an offer to lease to the other Party. This Lease is not
intended to be binding until executed and delivered by all Parties
hereto.
46. Amendments. This Lease may be
modified only in writing, signed by the Parties in interest at the time of the
modification. As long as they do not materially change Tenant's obligations
hereunder, Tenant agrees to make such reasonable non-monetary modifications to
this Lease as may be reasonably required by a Lender in connection with the
obtaining of normal financing or refinancing of the Premises.
47. Multiple Parties. If more than
one person or entity is named herein as either Landlord or Tenant, such multiple
Parties shall have joint and several responsibility to comply with the terms of
this Lease.
48. Waiver of Jury Trial. The
Parties hereby waive their respective rights to trial by jury in any action or
proceeding involving the Property or arising out of this Agreement.
49. Mediation and Arbitration of
Disputes. An Addendum requiring the Mediation and/or the Arbitration of
all disputes between the Parties and/or Brokers arising out of this Lease is is
not attached to this Lease.
50. No Oral
Agreement. This Lease covers in full each and every agreement
of every kind or nature whatsoever between the parties and their respective
agents and representatives hereto concerning this lease, and all preliminary
negotiations and agreements of whatsoever kind or nature are merged herein, and
there are no oral agreements or implied covenants. Landlord
specifically does not warrant that any other occupancy, present or future, in
the Industrial Project of which the Premises are a part, shall remain an
occupant during the term of this lease.
51. Nondisclosure of Lease
Terms. Tenant acknowledges and agrees that the terms of
this Lease are confidential and constitute proprietary information of Landlord.
Disclosure of the terms could adversely affect the ability of Landlord to
negotiate other leases and impair Landlord's relationship with other
tenants. Accordingly, Tenant, Tenant’s partners, managers, members,
officers, directors, employees, agents and attorneys agree they shall not
intentionally and voluntarily disclose the terms and conditions of this Lease to
any newspaper or other publication or any other tenant or apparent prospective
tenant of the Building or other portion of the Industrial Project, or real
estate agent, either directly or indirectly, without the prior written consent
of Landlord, provided, however, that Tenant may disclose the terms to
prospective subtenants or assignees under this Lease.
52. Americans with Disabilities
Act. Landlord agrees to be responsible for and shall pay all
remedial costs associated with, and shall use commercially reasonable diligence
in complying with, the Americans with Disabilities act ("ADA"), as it relates to
the Common Areas of the Building only, based solely on requirements existing and
imposed on Landlord as of the Commencement Date. Any changes,
modifications, rehabilitation or repair to the Common Area required by any
amendment to ADA or any regulations thereunder which are enacted or become
effective after the Commencement Date, shall be Landlord's responsibility, but
the cost thereof shall be an Operating Expense for purposes of this
Lease. Notwithstanding anything contained herein to the
contrary, Landlord shall have no duty, obligation or responsibility,
nor shall Landlord be obligated to expend any moneys over and above the work
specified in the Work Letter to make the Premises comply with any requirements
of ADA or any other similar laws, including life-fire safety codes, physical
handicap codes and/or earthquake safety codes.
53. Legal Advice; Neutral Interpretation;
Headings. Each party has received independent legal advice from their
attorneys with respect to the advisability of executing this Lease and the
meaning of the provisions hereof. The provisions of this Lease shall be
construed as to their fair meaning, and not for or against any party based upon
any attribution to such party as the source of the language in question.
Headings used in this Lease are for convenience of reference only and shall not
be used in construing this
Lease.
54. Joint
Drafting: This Lease shall not be construed in favor of or
against either party, but shall be construed as if both parties prepared this
Lease. Landlord and Tenant acknowledge that they have been
represented, or have had the opportunity to be represented, by counsel of their
own choice. Neither Landlord and Tenant is relying upon any legal
advice from the other party's counsel regarding the subject matter
hereof. Both parties acknowledge that they understand the terms and
conditions of this Lease and the terms and conditions of all other documents and
agreements executed in connection herewith and that they sign the same
freely. Neither Landlord nor Tenant shall deny the enforceability of
any provision of this Lease or any of the other documents or agreements executed
in connection herewith on the basis that it did not have legal
counsel or that it did not understand any such term or
condition. This Lease and any ambiguities or uncertainties contained
in this Lease shall be equally and fairly interpreted for the benefit of and
against all parties to this Lease and shall further be construed and interpreted
without reference to the identity of the party or parties preparing this
document, it being expressly understood and agreed that the parties hereto
participated equally in the negotiation and preparation of this Lease or have
had equal opportunity to do so. Accordingly, the parties hereby waive
the legal effect of of any successor and/or amended statute which in part states
that in cases of uncertainty, the language of the contract should be interpreted
most strongly against the party who caused the uncertainty to
exist. The captions used herein are for convenience only and are not
a part of this Lease and do not in any way limit or amplify the terms and
provisions hereof.
LANDLORD
AND TENANT HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
PROVISION CONTAINED HEREIN AND, BY THE 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 LANDLORD AND TENANT WITH RESPECT TO THE
PREMISES.
Dated: ___________
LANDLORD:
FKC
HIGHLAND, LLC,
a
Delaware limited liability company
By: FKC
LLC,
a California
limited liability company,
its
sole member
By: Xxxxxxx
VI, Inc.,
a
California corporation,
its
manager
________________
Xxxxx X. Xxxxxxxx
Managing Director
|
Dated: ___________
TENANT:
a
Nevada corporation
By:_______________________
Print Name
Its
By:_______________________
Print Name
Its
|
LEASE
ADDENDUM
Parties: This Lease Addendum
("Lease Addendum"),
which references that certain Lease dated August 11th, 2008 , is made by
and between FKC HIGHLAND LLC, a Delaware
limited liability company (“Landlord”) and
Fortunet, Inc., a
Nevada corporation (“Tenant"), (collectively the
"Parties", or
individually a "Party").
55. CONDITION
OF PREMISES
The Premises shall be delivered to
Tenant in its current “As-Is, “Where-is”, with all Faults Accepted”
condition.
56. EARLY OCCUPANCY
Upon receipt of Tenant’s insurance as
outlined per the Lease dated August 11, 2008, Landlord shall grant Tenant
occupancy of the Premises free ofall monthly rental and CAM charges for the
period of September 1, 2008 through September 30, 2008 prior to the Commencement
Date of theLease. Tenant’s obligation to pay for all separately
metered utilities shall commence upon delivery of possession.
58. REASONABLE
DOCUMENTATION
Landlord shall provide reasonable
documentation supporting any Operating Expense pass-through calculation and/or
year-end reconciliation throughout the term of the Lease.
Dated: ___________
LANDLORD:
FKC
HIGHLAND, LLC,
a
Delaware limited liability company
By: FKC
LLC,
a California
limited liability company,
its
sole member
By: Xxxxxxx
VI, Inc.,
a
California corporation,
its
manager
__________________________________
__________________________________
|
Dated: ___________
TENANT:
A
Nevada corporation
By:_______________________
Print Name
Its
By:_______________________
Print Name
Its
|
EXHIBIT
A
PREMESIS
HIGHLAND
INDUSTRIAL CENTER
![](https://www.sec.gov/Archives/edgar/data/1337899/000117184308000669/exh_1019.gif)
EXHIBIT
B
SIGNAGE
PROGRAM
TENANT
SIGN CRITERIA
INTRODUCTION
The
signage criteria contained in this Exhibit “B” (“Tenant Sign Criteria”) provides
design standards and specifications that assure consistency in quality, color,
size, placement, typestyle and configuration for Tenant signs throughout the
Industrial Building Project. Tenant signs shall be carefully
designed, fabricated and installed to equal or exceed the standards normally
associated with commercial signage. Landlord reserves the sole right
to modify, change, or eliminate all or part of the Tenant Sign Criteria at any
time by written notice to Tenant.
SUBMITTALS
AND APPROVALS
1.
|
Prior
to sign fabrication and submittal for permit, Tenant shall submit for
Landlord’s approval three (3) complete sets of working
drawings. Such submissions shall
include:
|
a)
|
Elevation
of building and/or storefront showing design, location, size and layout of
sign, drawn to scale, indicating dimensions, attachment devices and
construction detail
|
b)
|
Colored
elevations showing colors and materials including building fascia, letters
faces, returns, and other details of construction as requested by
Landlord. This section may be omitted if Tenant conforms with
the supplemental signage criteria, if any, provided by Landlord during the
Term of the Lease. Section through letter and/or sign panel
showing the dimensioned projection of the face of the letter and/or sign
panel and the illumination.
|
2.
|
All
Tenant sign submittals shall be reviewed by Landlord and/or its agent for
conformance with the provisions of these signage
criteria.
|
3.
|
If
required during the permit process, Tenant shall also submit sign drawings
for approval to the appropriate association review committee and provide
to the City and Landlord a copy of the letter of
approval.
|
4.
|
Within
ten (10) business days after receipt of Tenant’s working drawings,
Landlord shall either approve the submittal contingent upon any required
modifications or disapprove Tenant’s sign submittal, which approval or
disapproval shall remain the sole right and discretion of
Landlord. Tenant must continue to resubmit rejected plans until
approval is obtained. A full set of final plans must be
approved and stamped by Landlord prior to permit application and sign
fabrication.
|
5.
|
Following
Landlord’s approval of proposed signage, Tenant or Tenant’s agent shall
submit to the appropriate governmental agency all sign plans signed by
Landlord and applications for all permits for fabrication and installation
by sign contractor. Tenant shall furnish Landlord with a copy
of said permits prior to installation of Tenant’s
sign(s).
|
6.
|
Fabrication
and installation of all signs shall be performed in accordance with the
standards and specifications outlined in these criteria, the final
approved plans and working drawings, and all applicable codes and
regulations.
|
7.
|
Tenant
shall install the approved signage within 30 days after receipt of
permit. If signage is not in place by that date,
Landlord may order fabrication and installation on Tenant’s
behalf. Tenant shall reimburse Landlord for these
costs.
|
TENANT’S
RESPONSIBILITIES
Tenant
shall be responsible for all expenses relating to signage for the Premises
including, but not limited to:
1.
|
100%
of costs for permit processing and application
fees
|
2.
|
100%
of costs for sign fabrication and
installation
|
3.
|
All
costs relating to signage removal, including repair of any damage to the
building
|
NON-CONFORMING
SIGNS
Landlord
may, at its sole discretion and at Tenant’s expense, correct, replace or remove
any sign that is installed without written approval and/or that is deemed not to
be in conformance with the plans as submitted and approved by
Landlord.
PROHIBITED
SIGNS
Only
those sign types provided for herein and specifically approved in writing by the
Landlord will be allowed. The following signs are
prohibited:
1.
|
Temporary
wall signs, pennants, flags, banners, inflatable displays or sandwich
boards. (Except if approved in advance and in writing by the
Landlord).
|
2.
|
Window
signs except where specifically approved by Landlord under the
Lease.
|
3.
|
Exposed
junction boxes, transformers, lamps, tubing, conduits, raceways or neon
crossovers of any type.
|
4.
|
Signs
using “Trim Cap” retainers that do not match the color of letter and logo
returns.
|
5.
|
Pre-manufactured
signs, such as franchise signs, that have not been modified to meet these
criteria.
|
6.
|
Paper,
cardboard or styrofoam signs, stickers, or decals hung around, on or
behind Premises.
|
7.
|
Simulated
materials (i.e., wood grained plastic laminates, etc.) or wall
covering.
|
8.
|
Animated
lights or other “moving” sign components, except where specifically
provided by the approved sign plan.
|
9.
|
Internally
illuminated awning backgrounds.
|
10.
|
Roof
top signs, signs projecting above roof lines or parapets, signs on mansard
roofs or equipment screens.
|
11.
|
Advertising
or promotional signs affixed to parked vehicles and/or put on the
sidewalks or in the landscaped
areas.
|
EXHIBIT
C
RULES
AND REGULATIONS
A. General
Rules and Regulations. The following rules and regulations govern the use
of the Building and the Common Areas. Tenant will be bound by such rules and
regulations and agrees to cause Tenants Parties to observe the
same.
1. Except
as specifically provided in the Lease to which these Rules and Regulations are
attached, no sign, placard, picture, stickers, banners, advertisement, name or
notice may be installed or displayed on any part of the outside or inside of the
Building without the prior written consent of Landlord. Landlord will have the
right to remove, at Tenant's expense and without notice, any sign installed or
displayed in violation of this rule. All approved signs or lettering on doors
and walls are to be printed, painted, affixed or inscribed at the expense of
Tenant and under the direction of Landlord by a person or company designated or
approved by Landlord.
2. If
Landlord objects in writing to any curtains, blinds, shades, screens or hanging
plants or other similar objects attached to or used in connection with any
window or door of the Premises, or placed on any windowsill, which is visible
from the exterior of the Premises, Tenant will immediately discontinue such use.
Tenant agrees not to place anything against or near glass partitions or doors or
windows which may appear unsightly from outside the Premises, including, without
limitation, stickers, tinting materials, foil shades, blinds or
screens.
3. Tenant
will not obstruct any sidewalks, passages, exits or entrances of the Project.
The sidewalks, passages, exits and entrances are not open to the general public,
but are open, subject to reasonable regulations, to Tenant's business invitees.
Landlord will in all cases retain the right to control and prevent access
thereto of all persons whose presence in the reasonable judgment of Landlord
would be prejudicial to the safety, character, reputation and interest of the
Project and its tenants, provided that nothing herein contained will be
construed to prevent such access to persons with whom any tenant normally deals
in the ordinary course of its business, unless such persons are engaged in
illegal or unlawful activities. No tenant and no employee or invitee of any
tenant will go upon the roof of the Building.
4.
Landlord expressly reserves the right to absolutely prohibit solicitation,
canvassing, distribution of handbills or any other written material or goods,
peddling, sales and displays of products, goods and wares in all portions of the
Project except for such activities as may be expressly permitted under the
Lease. Landlord reserves the right to restrict and regulate the use of the
Common Areas of the Project by invitees of tenants providing services to tenants
on a periodic or daily basis including food and beverage vendors. Such
restrictions may include limitations on time, place, manner and duration of
access to a tenant's premises for such purposes.
5.
Landlord reserves the right to prevent access to the Project in case of
invasion, mob, riot, public excitement or other commotion by closing the doors
or by other appropriate action.
6.
Landlord reserves the right to approve companies providing cleaning and
janitorial services for the Premises. Tenant will not cause any unnecessary
labor by carelessness or indifference to the good order and cleanliness of the
Premises.
7.
Landlord will furnish Tenant, free of charge, with two keys to each exterior
entry door lock to the Premises. Landlord may make a reasonable charge for any
additional keys. Tenant shall not make or have made additional keys, and Tenant
shall not alter any lock or install any new additional lock or bolt on any door
of the Premises. Tenant, upon the termination of its tenancy, will deliver to
Landlord the keys to all doors which have been furnished to Tenant.
8. If
Tenant requires telegraphic, telephonic, burglar alarm, satellite dishes,
antennae or similar services, it will first obtain Landlord's written approval,
and comply with, Landlord's reasonable rules and requirements applicable to such
services, which may include separate licensing by, and fees paid to, Landlord,
as well as all federal, state, and local regulations. Tenant will not transmit
or receive any electromagnetic, microwave or other radiation which may be
harmful or hazardous to any person or property in or about the Premises or
elsewhere within the Project.
9. No
deliveries will be made which impede or interfere with other tenants or the
operation of the Building.
10.
Tenant will not use or keep in the Premises any kerosene, gasoline or
inflammable or combustible fluid or material other than those limited quantities
necessary for the operation or maintenance of office equipment. Tenant will not
sleep, xxxx or wash clothes in the Premises or use or permit to be used in the
Premises any foul or noxious gas or substance, or permit or allow the Premises
to be occupied or used in a manner offensive or objectionable to Landlord or
other occupants of the Building by reason of noise, odors or vibrations, intense
glare, light or heat, nor will Tenant bring into or keep in or about the
Premises any birds or animals.
11.
Landlord reserves the right, exercisable without notice and without liability to
Tenant, to change the name and street address of the Building. Without the
written consent of Landlord, Tenant will not use the name of the Building or the
Project in connection with or in promoting or advertising the business of Tenant
except as to Tenant's address.
12. The
toilet rooms, toilets, urinals, wash bowls and other apparatus will not be used
for any purpose other than that for which they were constructed and no foreign
substance of any kind whatsoever shall be deposited therein. The expense of any
breakage, stoppage or damage resulting from any violation of this rule will be
borne by the tenant who, or whose employees or invitees, violate this
rule.
13.
Tenant will not sell, or permit the sale at retail of newspapers, magazines,
periodicals, theater tickets or any other goods or merchandise to the general
public in or on the Premises. Tenant will not make any building-to-building
solicitation of business from other tenants in the Project. Tenant will not use
the Premises for any business or activity other than that specifically provided
for in this Lease. Tenant will not conduct,
nor permit to be conducted, either voluntarily or involuntarily, any auction
upon the Premises without first having obtained Landlord's prior written
consent, which consent Landlord may withhold in its sole and absolute
discretion.
14.
Except for the ordinary hanging of pictures and wall decorations, Tenant will
not xxxx, drive nails partitions, woodwork or plaster or in any way deface the
Premises or any part thereof, except as expressly permitted by this Lease.
Landlord reserves the right to direct electricians as to where and how telephone
and telegraph wires are to be installed into the Premises. Tenant will not cut
or bore holes for wires. Tenant will not affix any floor covering to the floor
of the Premises in any manner except as approved in writing by Landlord. Tenant
shall, at Tenant’s sole cost and expense, repair any damage resulting
from noncompliance with this or any other rule set forth herein.
15.
Landlord reserves the right to exclude or expel from the Project any person who,
in Landlord's judgment, is intoxicated or under the influence of liquor or drugs
or who is in violation of any of the Rules and Regulations of the
Building.
16.
Tenant will store all its trash and garbage within its Premises or in other
facilities provided by Landlord for such purpose. Tenant will not place in any
trash box or receptacle any material which cannot be disposed of in the ordinary
and customary manner of trash and garbage disposal. All garbage and refuse
disposal is to be made in accordance with directions issued from time to time by
Landlord.
17. The
Premises will not be used for lodging nor shall the Premises be used for any
improper, immoral or objectional purpose.
18.
Tenant agrees to comply with all safety, fire protection and evacuation
procedures and regulations established by Landlord or any governmental
agency.
19.
Tenant assumes any and all responsibility for protecting its Premises from
theft, robbery and pilferage, which includes keeping doors locked and other
means of entry to the Premises closed. Tenant will not leave or store any
equipment, materials or items of any kind outside the walls of the
Premises.
20.
Tenant shall use at Tenant's cost such pest extermination and control
contractor(s) as Landlord may direct and at such intervals as Landlord may
reasonably require.
21. To
the extent Landlord reasonably deems it necessary to exercise exclusive control
over any portions of the Common Areas for the mutual benefit of the tenants in
the Project, Landlord may do so subject to reasonable rules and
regulations.
22.
Tenant's requirements will be attended to only upon appropriate written
application to Landlord's management office for the Project by an authorized
individual of Tenant. Employees of Landlord will not perform any work or do
anything outside of their regular duties unless under special instructions from
Landlord, and no employee of Landlord will admit any person (Tenant or
otherwise) to any office without specific instructions from
Landlord.
23. These
Rules and Regulations are in addition to, and will not be construed to in any
way modify or amend, in whole or in part, the terms, covenants, agreements and
conditions of the Lease. Landlord may waive any one or more of these Rules and
Regulations for the benefit of Tenant or any other tenant, but no such waiver by
Landlord will be construed as a waiver of such Rules and Regulations in favor of
Tenant or any other tenant, nor prevent Landlord from thereafter enforcing any
such Rules and Regulations against any or all of the tenants of the
Project.
24.
Landlord reserves the right to make such other and reasonable Rules and
Regulations as, in its judgment, may from time to time be needed or
advantageous, for safety and security, for care, and cleanliness,
attractiveness or benefit of the Project and for the preservation of good order
therein. Tenant agrees to abide by all such Rules and Regulations herein above
stated and any additional reasonable rules and regulations which are adopted by
Landlord. Tenant is responsible for the observance of all of the foregoing rules
by Tenant's employees, agents, clients, customers, invitees and
guests.
B. Parking
Rules and Requlations. The following rules and
regulations govern the use of the parking facilities which serve the Building.
Tenant will be bound by such rules and regulations and agrees to cause its
employees, subtenants assignees, contractors, suppliers, customers and invitees
to observe the same:
1. Tenant
will not permit or allow any vehicles that belong to or are controlled by Tenant
or Tenant's employees, subtenants, customers or invitees to be loaded, unloaded
or parked in areas other than those designated by Landlord for such activities.
No vehicles are to be left in the parking areas overnight and no vehicles are to
be parked in the parking areas other than normally sized passenger automobiles,
motorcycles and pick-up trucks. No storage of vehicles is
permitted.
2.
Vehicles must be parked entirely within painted stall lines of a single parking
stall.
3. All
directional signs and arrows must be observed.
4. The
speed limit within all parking areas shall be five (5) miles per
hour.
5.
Parking is prohibited: (a) in areas not striped for parking; (b) in aisles or on
ramps; (c) where "no parking" signs are posted; (d) in cross-hatched areas; and
(e) in such other areas as may be designated from time to time by Landlord or
Landlord's parking operator.
6.
Landlord reserves the right, without cost or liability to Landlord, to tow any
vehicle if such vehicle's audible theft alarm system remains engaged for an
unreasonable period of time.
7.
Washing, waxing, cleaning or servicing of any vehicle in any area not
specifically reserved by Landlord for such purpose is prohibited.
8.
Landlord may refuse to permit any person to park in the parking facilities who
violates these rules, and any violation of these rules shall subject the
vioiator's car to removal, at such car owner's expense. Tenant agrees to use its
best efforts to acquaint its employees, subtenants, assignees, contractors,
suppliers, customers and invitees with these parking provisions, rules and
regulations.
9.
Landlord reserves the right, without cost or liability to Landlord, to tow any
vehicles which are used or parked in violation of these rules and
regulations.
10.
Landlord reserves the right from time to time to modify and/or adopt such other
reasonable rules and regulations for the parking facilities as it deems
reasonably necessary or advantageous to the operation of the parking
facilities.
RULES AND REGULATIONS FOR
ALTERATIONS
ALTERATIONS.
After installation of the initial Tenant Improvements for the Premises as
described on Exhibit "A-1" to the Lease, Tenant shall not make
any alterations, additions, improvements or decorations to the Premises
(collectively, "Alterations") without Landlord's prior written consent, which
consent Landlord may withhold in its reasonable but subjective discretion. All
permitted Alterations shall be subject to the following terms and
conditions:
(a) Prohibited Alterations. Tenant
may not make any Alterations which: (i) affect any area outside the Premises;
(ii) affect the Building's structure, equipment, services or systems, or the
proper functioning thereof, or Landlord's access thereto; (iii) affect the
outside appearance, character or use of the Building or any Common Areas; (iv)
in the reasonable opinion of Landlord, lessen the value of the Building; or, (v)
will violate, require a change or incur an added cost in connection with any
occupancy certificate, or insurance polity applicable to the
Premises.
(b) Landlord's Approval. In
requesting Landlord's approval of any Alterations, Tenant must deliver to
Landlord written notice requesting Landlord's approval and a copy of any plans,
specifications and working drawings for any such Alterations at least ten (10)
days prior to commencement of the work thereof. Landlord's approval of plans,
specifications and/or working drawings for Alterations will not create any
responsibility or liability on the part of Landlord for their completeness,
design sufficiency, or compliance with applicable permits, laws, rules and
regulations of governmental agencies or authorities. In approving any
Alterations, Landlord reserves the right to require Tenant to increase its
security deposit to provide Landlord with additional reasonable security for the
removal of such Alterations by Tenant as may be required by the
Lease.
(c) Contractors. Alterations may
be made or installed only by contractors and subcontractors which have been
approved in writing by Landlord, which approval Landlord will not unreasonably
withhold or delay; provided, however, Landlord reserves the right to require
that a contractor designated by Landlord as a preferred contractor for the
Building be given the first opportunity to bid for any Alteration work. Before
proceeding with any Alterations, Tenant agrees to provide Landlord with ten (10)
days prior written notice and Tenant's contractors must obtain and maintain, on
behalf of Tenant and at Tenant's sole cost and expense: (i) all necessary
governmental permits and approvals for the commencement and completion of such
Alterations; and (ii) if requested by Landlord, a completion and lien indemnity
bond, or other surety, reasonably satisfactory to Landlord for such Alterations.
Throughout the performance of any Alterations, Tenant agrees to obtain, or cause
its contractors to obtain, workers compensation insurance and general liability
insurance in compliance with the provisions of Paragraph 19 of the
Lease.
(d) Manner of Performance. All
Alterations must be performed: (i) in accordance with the approved plans,
specifications and working drawings; (ii) in a lien-free and first-class and
workmanlike manner; (iii) in compliance with all applicable permits, laws,
statutes, ordinances, rules, regulations, orders and rulings now or hereafter in
effect and imposed by any governmental agencies and authorities which assert
jurisdiction; (iv) in such a manner so as not to interfere with the occupancy of
any other tenant in the Building, nor impose any additional expense upon nor
delay Landlord in the maintenance and operation of the Building; and (v) at such times,
in such manner, and subject to such rules and regulations as Landlord may from
time to time reasonably designate.
(e) Ownership. At Landlord's
election, all Alterations will become the property of Landlord and will remain
upon and be surrendered with the Premises at the end of the Term of the Lease,
or, Landlord may, by written notice delivered to Tenant, identify those
Alterations which Landlord will require Tenant to remove at the end of the Term
of the Lease. Landlord may also require Tenant to remove Alterations which
Landlord did not have the opportunity to approve. If Landlord requires Tenant to
remove any Alterations, Tenant, at its sole cost and expense, agrees to remove
the identified Alterations on or before the expiration or earlier termination of
the Lease and repair any damage to the Premises caused by such removal; or, at
Landlord's option, Tenant agrees to pay to Landlord all of Landlord's costs of
such removal and repair.
(f) Personal Property. All
articles of
personal property owned by Tenant or installed by Tenant at its expense in the
Premises (including Tenant's business and trade fixtures, furniture, movable
partitions and equipment [such as telephones, copy machines, computer terminals,
refrigerators and facsimile machines]) will be and remain the property of
Tenant, and must be removed by Tenant from the Premises, at Tenant's sole cost
and expense, on or before the expiration or earlier termination of the Lease.
Tenant agrees to repair any damage caused by such removal at its cost on or
before the expiration or earlier termination of the Lease.
(g) Removal of Alterations. If
Tenant fails to remove by the expiration or earlier termination of the Lease all
of its personal property, or any Alterations identified by Landlord for removal,
Landlord may, at its option, treat such failure as a hold-overpursuant to
Paragraph 11(b) of the Lease, and/or Landlord may (without liability to Tenant
for loss thereof) treat such personal property and/or Alterations as abandoned
and, at Tenant's sole cost and expense, and in addition to Landlord's other
rights and remedies under the Lease, at law or in equity: (a) remove and store
such items; andlor (b) upon ten (10) days prior notice to Tenant, sell, discard
or otherwise dispose of all or any such items at private or public sale for such
price as Landlord may obtain or by other commercially reasonable means. Tenant
shall be liable for all costs of disposition of Tenant's abandoned property and
Landlord shall have no liability to Tenant with respect to any such abandoned
property. Landlord agrees to apply the proceeds of any sale of any such property
to any amounts due to Landlord under this Lease from Tenant (including
Landlord's attorneys' fees and other costs incurred in connection with the
removal, storage and/or sale of such items), with any remainder to be paid to
Tenant.
EXHIBIT
D
TENANT'S
INSURANCE REQUIREMENTS
This
Exhibit “D” defines the insurance requirements of your Lease in addition to all
requirements included in Paragraph 8 of the Lease.
To assure
compliance with these terms, we suggest you send a copy of this Exhibit “D” to
your insurer or agent. Initial Certificates must be provided to
Landlord prior to occupancy of the Premises, renewals thirty (30) days before
expiration.
1. Tenant’s
Comprehensive or Commercial General Liability Insurance:
·
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$1,000,000
Combined Single Limit, each
occurrence
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·
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$2,000,000
Aggregate (minimum) this location
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·
|
$2,000,000
Products/Completed Operations
Aggregate
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·
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Broad
Form General Liability Endorsement
coverages
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·
|
Full
comprehensive liability coverage of operations at leased
premises.
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2. Tenant's
Property Insurance:
·
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All
Risks coverage of Property owned by Tenant or for which the Tenant is
legally liable; replacement cost basis, covering no less than 100% of all
values;
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·
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Vandalism
and malicious mischief coverage to be included;
and
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·
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Sprinkler
leakage and earthquake sprinkler leakage endorsements to be
included.
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·
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One-year
business interruption due to insured
peril.
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3.
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Tenant's
Workers' Compensation Insurance:
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·
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Statutory
Limits and terms required by the State of Nevada, $1,000,000 Workers’
Compensation Limit
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4. Tenant's
Automobile Insurance (if applicable):
·
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$1,000,000
Combined Limit per accident; covering all owned, non-owned, hired
autos
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5.
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All
insurance is to be with licensed insurers having a Best's rating of "B+"
or better, and must include the
following:
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·
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Waiver
of Subrogation in favor of
Landlord;
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·
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Thirty
(30) day pre-notice of cancellation renewal to
Landlord;
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·
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Policy
number and expiration date;
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·
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Bodily
Injury, Property Damage, Personal Injury and Advertising
Injury;
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·
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Blanket
Contractual Liability - Covering Indemnity Paragraph
8.5;
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·
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Products
and Completed Operations Liability;
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·
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Severability
of Interest, permitting cross liability among
insureds;
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·
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Provision
stating that Tenant's insurance is primary and non-contributory with any
insurance carried by Landlord; and
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·
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The
Certificate Holders and Additional Insured(s) shall
be:
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“Landlord” (as
defined in Paragraph 1.1 of the Lease) – Owner
FKC
LLC, a California limited liability company.
·
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SEND
ALL CERTIFICATES TO:
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FKC HIGHLAND
LLC
0000 X. Xxxxxxxx Xx., Xxxxx
X-000
Xxx Xxxxx,
XX 00000
Tel.: 000-000-0000
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6.
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Without
limiting the generality of the foregoing, Tenant shall obtain, pay and
keep in full force for the full term hereof, the following insurance
issued by a company or companies licensed to do business in Nevada and
satisfactory to Landlord:
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(a)
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Worker’s
Compensation Insurance covering all employees with coverage of not less
than One Million Dollars
($1,000,000.00).
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(b)
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Commercial
General Liability Insurance with a limit of liability of not
less than One Million Dollars ($1,000,000.00) coverage for each
occurrence, Two Million Dollars ($2,000,000.00) coverage for
products-completed operation aggregate (CG2010) (11/85 ED.), and Two
Million Dollars ($2,000,000.00) coverage for general
aggregate. Such insurance shall be written on an “occurrence”
basis. If such Commercial General Liability Insurance contains a general
aggregate limit, it shall apply separately to the
Premises. Insurance shall be written on ISO occurrence form CG
00 01 (or a substitute form providing equivalent coverage) and shall cover
liability arising from premises, operations, independent contractors,
products-completed operations, personal injury and liability assumed under
an insured contract. Landlord and its management company shall
all be included as Additional Insureds under the Commercial General
Liability Insurance using the ISO additional insured endorsement CG 20 10
(11/85 ED.) or a substitute providing equivalent coverage. Tenant shall
provide Landlord a Certificate of Insurance and an “Additional Insured
Endorsement”. Tenant’s insurance shall be primary insurance
with respect to any claims covered thereunder; any other insurance
maintained by Landlord shall be excess and non-contributory with the
insurance provided hereunder.
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(c)
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Automobile
Liability Insurance, including liability for all owned, hired and
non-owned vehicles, with not less than One Million Dollars ($1,000,000.00)
combined single limit bodily injury and property damage
coverage;
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Prior
to the commencement of the Lease Tenant shall furnish to Landlord original
certificates or copies of policies showing that such insurance is in force
and that the premiums due thereunder have been paid and that Landlord and
its management company are named by separate endorsement as additional
insured in respect to any loss covered. Such certificates or policies
shall provide that the insurance may not be cancelled, terminated or
modified without thirty (30) days advance written notice thereof to each
additional insured. No policy shall contain any provisions for
exclusion from liability other than provisions for exclusion forming a
part of the standard basic unamended and unendorsed form of policy,
provided, however, in no event shall any exclusion be permitted which
conflicts with any coverage required by this Lease. In the
event of any failure of Tenant to furnish and maintain insurance
required hereunder, any additional insured, at its option, and
without waiving the default of Tenant, shall have the right to obtain such
insurance for, and in the name of Tenant and the additional
insureds. In such event Tenant shall pay the cost thereof upon
demand (as additional rent) and shall furnish all information required by
the insurance carrier. Failure of Tenant to maintain the
required insurance shall be grounds, in the sole discretion of Landlord,
to terminate the Lease. All policies of insurance required hereunder must
indicate that Tenant and its insurer(s), waive all rights of subrogation
against Landlord and its management company as well as their respective
agents, members, managers, directors, officers, employees, attorneys,
contractors and representatives for recovery of damages to the extent
these damages are covered by any policy of insurance required
hereunder. The insurance company(ies) providing coverage
hereunder must be licensed to transact business in the State of Nevada and
must carry an A.M. Best Rating of B+ or
better.
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***********************************************************************
EXHIBIT
E
TENANT
ENVIRONMENTAL QUESTIONNAIRE
The
purpose of this form is to obtain information regarding the use or proposed use
of Hazardous Substances, as defined in Paragraph 50.2 of the Lease, at the
Premises. Prospective tenants should answer the questions in light of their
proposed operations at the Premises. Existing tenants should answer the
questions as they relate to ongoing operations at the Premises and should update
any information previously submitted. If additional space is needed to answer
the questions, you may attach separate sheets of paper to this
form. If conditions arise subsequent to the completion of this
form which would cause any information previously provided by Tenant to be
inaccurate, Tenant shall forthwith advise Landlord in writing of all such
changes.
Your
cooperation in this matter is appreciated.
1.0 GENERAL
INFORMATION
Name of
Responding Company: __________________________
Check the
Applicable Status: Prospective
Tenant Existing Tenant
Mailing
Address: _____________________________
_____________________________
_____________________________
Contact
Person and Title: ______________________, Telephone Number:
___/______________
Address
of Leased
Premises: ______________________________________
Length of
Lease Term: ________ months
Describe
the proposed operations to take place on the premises, including principal
products manufactured or services to be conducted. Existing tenants should
describe any proposed changes to ongoing operations.
_____________________________________________________________________________________.
2.0
STORAGE OF HAZARDOUS SUBSTANCES
2.1 Will
any Hazardous Substances be used or stored on-site?
Wastes Yes [
] No
[ ]
Chemical
Products Yes [
] No
[ ]
Other Yes [
] No
[ ]
2.2 Attach
a list of any Hazardous Substances to be used or stored, the quantities that
will be on-site at any given time, and the location and method of
storage.
3.0 STORAGE
TANKS AND SUMPS
3.1 Is
any above or below ground storage of gasoline, diesel or other Hazardous
Substances in tanks or sumps proposed or currently conducted at the
premises?
Yes [
] No
[ ]
If yes,
describe the materials to be stored, and the type, size and construction of the
sump or tank. Attach copies of any permits obtained for the storage of such
substances.
3.2 Have
any of the tanks or sumps been inspected or tested for leakage?
Yes [
] No
[ ]
If yes, attach the
results.
3.3 Have
any spills or leaks occurred from such tanks or sumps?
Yes [
] No
[ ]
3.4 Were
any regulatory agencies notified of the spill or leak?
Yes [
] No
[ ]
If yes,
attach copies of any spill reports filed, any clearance letters or other
correspondence from regulatory agencies relating to the spill or
leak.
3.5 Have
any underground storage tanks or sumps been taken out of service or
removed?
Yes [
] No
[ ]
If yes,
attach copies of any closure permits and clearance obtained from regulatory
agencies relating to closure and removal of such tanks.
4.0 SPILLS
4.1 If
an existing tenant, during the past year, have any spills occurred at the
Premises?
Yes [
] No
[ ]
If yes, please describe the location of
the spill.
_______________________________________________________________________________
4.2 Were
any agencies notified in connection with such spills?
Yes [
] No
[ ]
If yes,
attach copies of any spill reports or other correspondence with regulatory
agencies.
4.3 Were
any clean-up actions undertaken in connection with the spills?
Yes [
] No
[ ]
If yes,
attach copies of any clearance letters obtained from any regulatory agencies
involved and the results of any final soil or groundwater sampling done upon
completion of the clean-up work.
5.0
WASTE MANAGEMENT
5.1 Has
your company been issued an EPA Hazardous Waste Generator I.D.
Number?
Yes [
] No
[ ]
5.2 Has
your company filed a biennial report as a hazardous waste
generator?
Yes [
] No
[ ]
If yes,
attach a copy of the most recent report filed.
5.3 Attach
a list of the hazardous wastes, if any, generated or to be generated at the
Premises, its hazard class and the quantity generated on a monthly
basis.
5.4 Describe
the method(s) of disposal for each waste. Indicate where and how often disposal
will take place.
On-site
treatment or recovery: _________________
Discharged
to sewer: _______________________
Transported
& disposed of off-site:
Incinerator: ______________________________
5.5 Indicate
the name of the person(s) responsible for maintaining copies of hazardous waste
manifests completed for off-site shipments of hazardous waste.
_________________________________________
5.6 Is
any treatment of processing of hazardous wastes currently conducted or proposed
to be conducted at the Premises:
Yes [
] No
[ ]
If yes,
please describe any existing or proposed treatment methods.
_______________________________________________________________________________
5.7 Attach
copies of any hazardous waste permits or licenses issued to your company with
respect to its operations at the Premises.
5.8 Please
attach copies of any consents to your use or storage of Hazardous Substances
given by any prior owner of the Property.
6.0 WASTEWATER
TREATMENT/DISCHARGE
6.1 Do
you discharge wastewater to:
Storm drain:
Yes [
] No
[ ]
Sewer:
Yes [
] No
[ ]
Surface
water: Yes [
] No
[ ] Industrial xxxxx.: Yes [
] No
[ ]
Is your
wastewater treated before discharge?
Yes [
] No
[ ]
If yes,
describe the type of treatment conducted.
______________________________________________________________________
6.3 Attach
copies of any wastewater discharge permits issued to your company with respect
to its operations at the Premises.
7.0 AIR
DISCHARGES
7.1 Do
you have any filtration systems or stacks that discharge into the
air?
Yes [
] No
[ ]
7.2 Do
you operate any of the following types of equipment or any other equipment
requiring an air emissions permit?
[ ] Spray
booth [
] Incinerator
[ ] Dip
tank [
] Other (please describe) ______________________
[ ] Drying
oven [
] Other equipment requiring air permits
7.3 Are
air emissions from your operations monitored?
Yes [
] No
[ ]
If yes,
indicate the frequency of monitoring and a description of the monitoring
results.
________________________________________________________________________________
7.4 Attach
copies of any air emissions permits pertaining to your operations at the
Premises.
8.0 HAZARDOUS
SUBSTANCES DISCLOSURES
8.1 Does
your company handle Hazardous Substances in a quantity equal to or exceeding an
aggregate of 500 pounds, 55 gallons, or 200 cubic feet per month?
Yes [
] No
[ ]
8.2 Has
your company prepared a Hazardous Substances management plan pursuant to any
applicable requirements of a local fire department or governmental
agency?
Yes [
] No
[ ]
If yes,
attach a copy of the business plan.
8.3 Has
your company adopted any voluntary environmental, health or safety
program?
Yes [
] No
[ ]
If yes,
attach a copy of the program.
9.0 ENFORCEMENT
ACTIONS, COMPLAINTS
9.1 Has
your company ever been subject to any agency enforcement actions, administrative
orders, or consent decrees?
Yes [
] No
[ ]
If yes,
describe the actions and any continuing compliance obligations imposed as a
result of these actions.
__________________________________________________________________________________
9.2 Has
your company ever received requests for information, notice or demand letters,
or any other inquiries regarding its operations?
Yes [
] No
[ ]
9.3 Have
there ever been, or are there now pending, any lawsuits against the company
regarding any environmental or health and safety concerns?
Yes [
] No
[ ]
9.4 Has
an environmental audit ever been conducted at your company's current
facility?
Yes [
] No
[ ]
If yes,
identify who conducted the audit and when it was
conducted: _________________________
10.0
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Are
you aware of any potential damage to persons or property that could be
caused by the use of any Hazardous Substance or any other substance in the
ordinary course its usage or your
use.
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