OFFICE SPACE LEASE
This Office Space Lease is dated this 31st day of May, 1995, between
KGK Enterprises, Inc., a California corporation organized and existing under the
laws of the State of California ("Landlord") and Seagull Entertainment, Inc.,
("Tenant").
BASIC LEASE PROVISIONS
The following provisions shall be referred to in this Lease as the
"Basic Lease Provisions." The terms set forth in the Basic Lease Provisions
shall be defined terms and shall have a meaning consistent with the Basic Lease
Provisions when used in this Lease consisting of the Basic Lease Provisions, the
Standard Lease Provisions and the Exhibits and/or Addenda attached hereto.
a. Tenant: Seagull Entertainment, Inc.
b. Building: Cornerstone Plaza
0000 Xxxxx Xxxxx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Building Rentable Area: 164,311 square feet of office space.
c. Premises:
(1) Floor: Seventh (7th)
(2) Suite: 725
(3) Rentable Area: 2,804 rentable square feet
d. Basic Rent:
(a) Annual Basic Rent: $58,884.00
(b) Monthly Basic Rent: $4,907.00
e. Increases in Annual Basic Rent: None.
f. Tenant's Building Expense Percentage: 1.71%
g. Tenant's Expense Stop Base or Base Year: 1995
h. Rent Abatement: One and one half months (1 1/2) of free rent.
i. Term:
(1) Length of Term: Five (5) years.
(2) Estimated Commencement Date: June 23, 1995
j. Option to Extend: One (1) five (5) year Option to Extend at
Fair Market Value and six (6) months written notice.
k. Prepaid Rent: $4,907.00
1. Security Deposit: $4,907.00
m. Tenant Improvement Allowance: Refer to Exhibit B herein.
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n. Broker: Xxxxxxx Commercial Realty Services -- Xxxx Xxxxxxxxxxx
o. Guarantor: Xxxx Xxxxxx and Xxxxx Xxxxxx (Jointly and Severally)
p. Permitted Use: General Office.
q. Parking Spaces:
(1) On-site: Three (3) unreserved permits for every 1,000
rentable square feet leased at prevailing
building rates.
(2) Off-site: N/A
r. Building Directory Board: Tenant at Tenant's expense, may
purchase one directory strip for the directory board in the
main building lobby.
s. Addresses for Payments and Notice:
(1) If to Landlord:
KGK Enterprises, Inc.
c/o Xxxxxxxx Xxxx Company
0000 Xxxxx Xxxxx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
(2) If to Tenant:
To the Premises.
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OFFICE SPACE LEASE
STANDARD LEASE PROVISIONS
ARTICLE I PREMISES.
Landlord leases to Tenant, and Tenant leases from Landlord the Premises,
shown in the drawing attached to this Lease as Exhibit "A" and by this reference
incorporated herein, in the Building, which Building together with the
underlying land, landscaping, plaza area, parking facilities and other
improvements are referred to in this Lease as the "Project". This Lease is
subject to all of the terms, covenants and conditions set forth in the Basic
Lease Provisions, the Standard Lease Provisions, and the Exhibits and/or addenda
attached to this Lease.
1.2 Right of First Offer. If during the first thirty (30) months of the
Initial Lease Term, the 2,478 square foot space immediately adjacent to the
Premises on the seventh floor ("Additional Space") shall become available for
lease and provided that Tenant is not then in default of any of its Lease
obligations and has not assigned the Lease or sublet the entire Premises, Tenant
shall hare the first right option to lease the Additional Space. When the
Additional Space becomes available, or at Landlord's option, up to six (6)
months prior to the date that the Additional Space is scheduled to become
available, Landlord. Shall first offer in writing to lease such space to Tenant
upon the same terms and conditions and at the same rental rate as would be
offered by Landlord to third parties. If within five (5) days after Landlord
delivers to Tenant such written offer if, Landlord does not receive notice in
writing that Tenant elects to lease all of the Additional Space and within ten
(10) days thereafter Tenant does not execute a lease amendment incorporating all
of the terms of this Lease, except as said provisions are clearly inapplicable
to the Additional Space, then Landlord shall have the right to lease the
Additional Space (or any part thereof) to a third party. Provided, however, if
during the initial term, the Additional Space becomes available after it has
been initially leased to a third party, then Tenant's right pursuant to this
paragraph shall continue.
Additionally, if after Landlord has first offered the Additional Space to
Tenant and Tenant has refused to lease said Additional Space and then Landlord
decides to offer said Additional Space to third parties at a Rental Rate in
excess of ten percent (10%) below Landlord's original offer to Tenant, then
Landlord must offer said Additional Space to Tenant at this lower rate. Upon
Landlord's delivery of such written offer, Tenant shall have three (3) days to
elect to exercise said option by providing Landlord written notice of its intent
to lease said Additional Space. If Landlord does not receive notice in writing
that Tenant elects to lease all of the Additional Space and within ten (10) days
thereafter Tenant does not execute a lease amendment on the Additional Space,
then Landlord shall have the right to lease the Additional Space to a third
party.
ARTICLE II TERM.
2.1 Commencement Date. The term shall commence on the earliest of the
following three dates, which earliest date shall be referred to in this Lease as
the "Commencement Date":
(a) The seventh day following the Beneficial Occupancy Date (as
defined in Section 2.4 below);
(b) The date when Tenant enters or occupies the Premises for any use
other than for purposes of construction of improvements or inspection of
the Premises under construction; or
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(c) The date upon which the parties agree as the Commencement Date.
When the Commencement Date is ascertained as above, the term shall commence
and upon request of Landlord, Tenant shall execute a certificate or memorandum
confirming the Commencement Date and the Expiration Date. Upon termination of
this Lease, whether upon expiration of the entire term of this Lease or
otherwise, Tenant agrees to execute and deliver to Landlord within ten (10) days
after written request therefor any documents reasonably required by Landlord to
confirm or evidence the termination of this Lease.
2.2 Measurement of Lease Term and Expiration Date. The Lease term shall be
for the number of years and/or months set forth in the Basic Lease Provisions
measured from the Commencement Date if such date is the first day of a calendar
month or otherwise measured from the first day of the calendar month beginning
after the Commencement Date, which date shall be the "Measurement Date" of this
Lease. The Lease term shall include any period of less than one (1) month from
the Commencement Date to the first day of the next calendar month. The
"Expiration Date" shall be the last day of the last calendar month occurring
upon lapse of the number of years and/or months stated in the Basic Lease
Provisions as Length of Term measured from the Measurement Date. The period from
the Commencement Date through and including the Expiration Date shall be
referred to in this Lease as the "Term".
2.3 Estimated Commencement Date. The Basic Lease Provisions contain an
Estimated Commencement Date stating the date on which Landlord reasonably
believes the Premises will be available for beneficial occupancy by Tenant.
Landlord shall use all reasonable efforts to make the Premises available on the
Estimated Commencement Date; provided, however, that Landlord and Tenant
acknowledge that delays or time savings which are beyond the control of Landlord
may cause the Commencement Date to occur on a date other than the Estimated
Commencement Date. Accordingly, failure of the Commencement Date to occur on the
Estimated Commencement Date shall not affect the terms, conditions, validity or
commencement of this Lease, and Landlord shall have no liability to Tenant for
any loss, cost, expense or liability arising out of or related to failure of
this Lease to commence on the Estimated Commencement Date.
2.4 Beneficial Occupancy Date. The Premises shall be deemed available for
beneficial occupancy when all of the following conditions have been satisfied:
(a) Landlord has placed in operating condition the plumbing, heating,
air conditioning and electrical systems serving the Premises;
(b) Landlord shall have substantially completed all of the work, if
any, required to be performed by Landlord pursuant to any Work Letter
Agreement attached to this Lease as an exhibit; provided, however, that the
date of such substantial completion shall be advanced by any period of
delay which Landlord determines has been caused by Tenant (including any
delay referred to in the Work Letter Agreement as Tenant Delay). If no Work
Letter Agreement is attached to this Lease, then this condition shall be
deemed satisfied; and
(c) Any previous tenant or occupants of the Premises shall have
vacated the Premises.
The date when the Premises are available for beneficial occupancy shall be
the "Beneficial Occupancy Date."
2.5 Option to Renew. Tenant shall have the right, at its option, to extend
the term for (1) period of five (5) years (the "Option Term") immediately
following the expiration of the initial term. Tenant shall exercise its right to
extend the Term by delivery of written notice to Landlord at least six (6)
months prior to the then scheduled Expiration Date of the Term. This Option to
Extend is personal to Tenant and may not be exercised by any assignee or
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subtenant of Tenant, even if Landlord has consented to the assignment or
subletting.
(a) Incorporation of Lease by Reference, All of the terms, covenants
and conditions (including without limitation defined terms contained in
this Lease shall be applicable to the Option Term in the event of exercise
by Tenant.
Term, Annual Basic Rent and the Monthly Basic Rent shall be modified
as provided herein and Tenant shall not be entitled to any further option
to extend this Lease.
(b) Rent. Subject to adjustment as hereafter provided, the Annual
Basic Rent for the Option Term should be adjusted to one hundred percent
(100%) of the Prevailing Market Rent, described below. The Monthly Basic
Rent shall be adjusted to one-twelfth (1/12} of the adjusted Annual Basic
Rent.
(c) Prevailing Market Rent. The "Prevailing Market Rent" shall be
equal to the then prevailing market rate for comparable office space in
first class office buildings in the West Los Angeles area. In determining
the Prevailing Market Rent, whether for comparable space within the
Building or in the West Los Angeles area of Los Angeles County, California,
the following factors shall be taken into account:
(i) The particular configuration, frontage along a public
thoroughfare, signage visible to the public, parking facilities, and
general level of quality of improvements and location of each
comparison building shall be relevant.
(ii) Charges for parking, if any, shall be taken into
consideration and adjustments shall be made for variations, if any, in
charges paid as additional rent by Tenants.
(iii) No rent which has not been set or adjusted during the
twelve month period immediately preceding the Expiration Date of the
Initial Term shall be considered prevailing or current.
(iv) Periods of free rent or other rent concessions shall be
taken into account.
If Tenant has timely exercised the 0ption, Landlord shall notify Tenant in
writing of the proposed new Annual Basic Rent determined by Landlord for the
Option Term at least one hundred twenty (120) days prior to the Commencement
Date of the Option Term. Unless Tenant objects to the amount determined by
Landlord within fifteen (15) days after receipt of such notice, the amount
stated in such notice shall be the new Annual Basic Rent. If Tenant objects to
Landlord's proposal, then the new Annual Basic Rent shall be determined by a MAI
appraiser chosen by Landlord and approved by Tenant. If Tenant does not
disapprove Landlord's choice of an appraiser by delivery of written notice of
disapproval within five (5) days of written notice of such choice by Landlord,
then landlord's appraiser shall be deemed to be approved by Tenant. If Tenant
does not approve Landlord's choice of an appraiser, then Tenant's notice of
disapproval shall name a MAI appraiser designated by Tenant, and each of
Landlord's appraiser and Tenant's appraiser shall appoint a third MAI appraiser
and each appraiser shall determine the Prevailing Market Rent. The two amounts
which are closest shall be averaged, and such average shall be the Prevailing
Market Rent for purposes of this Option. The cost of any common appraiser shall
be split equally by Landlord and Tenant, and if three appraisers are utilized,
Landlord and Tenant shall each be responsible for the fees and costs of the
appraiser which it appoints. If the Annual Basic Rent shall not have been
determined by the Commencement Date of the Option Term, until it is determined,
Tenant shall pay Monthly Basic Rent when due during the Option Term determined
using Landlord's proposed Annual Basic Rent, and when the actual adjusted Annual
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Basic Rent is determined, either Tenant shall pay to Landlord any additional
rent due for the months which have elapsed in the Option Term, or Landlord shall
credit any excess payment for the elapsed months to the next Monthly Basic Rent
becoming due.
ARTICLE III TENANT IMPROVEMENTS AND ACCEPTANCE OF PREMISES.
Landlord's sole obligation with respect to Tenant improvements shall be to
perform the work set forth in any Work Letter Agreement attached to this Lease
as Exhibit "B". If a Work Letter Agreement is not attached to this Lease, then
Landlord shall have no obligation to construct leasehold improvements for Tenant
or to repair or refurbish the Premises whatsoever. By taking possession of the
Premises, Tenant shall have acknowledged that (i) it has inspected the Premises,
(ii) it accepts the Premises, (iii) the Premises are in good and sanitary order,
and (iv) all work to be performed by Landlord has been satisfactorily completed
except for those minor items which Landlord and Tenant shall agree require
further completion and which items shall be incorporated into a written punch
list executed by Landlord and Tenant prior to the Beneficial Occupancy Date.
Landlord shall use all reasonable efforts to cause the items listed on the punch
list to be completed within a reasonable time. Tenant acknowledges that neither
Landlord nor any agent of Landlord has made any promise, representation or
warranty with respect to the Premises, the Building or the Project, or with
respect to the suitability of any part of the Project for the conduct of
Tenant's business unless otherwise set forth in this Lease or its exhibits.
ARTICLE IV RENT.
4.1 Basic Rent. Tenant shall pay to Landlord the Annual Basic Rent for the
Premises set forth in the Basic Lease Provisions, as the same may be increased
pursuant to this Lease. Tenant's obligation to pay rent shall begin on the
Commencement Date and shall continue until all rent due for the Term has been
paid. The Monthly Basic Rent is an amount equal to one-twelfth of the Annual
Basic Rent, as adjusted. The Monthly Basic Rent shall be paid in advance on or
before the first day of each and every calendar month during the Term. If the
Commencement Date occurs on a day other than the first day of a calendar month,
then the rent payable by Tenant to Landlord for the period from the Commencement
Date to the Measurement Date shall be prorated and the rent for the partial
month following the Commencement Date shall be payable on the Commencement Date.
Any rent due for a period other than a full month will be pro rated on a daily
basis using a 30 day month. The rent payable for the first full calendar month
of the Term shall be payable upon execution of this Lease by Tenant. Rent shall
be payable without notice, demand, reduction or setoff in lawful money of the
United States of America to Landlord or its agent at the address set forth in
the Basic Lease Provisions, or to such other person or such other places
Landlord may from time to time designate in writing. If (a) any check submitted
by Tenant in payment of rent or any other charge due under this Lease shall be
returned for insufficient funds, or (b) Tenant shall fail to pay when due its
rent or any other charge due under this Lease for two (2) consecutive months or
three (3) times in any twelve (12) month period, then in addition to any other
rights and remedies of Landlord, Landlord may require that Tenant thereafter pay
its basic rent and other charges by cashiers' check and/or pay its basic rent
and other charges in quarterly payments covering three (3) months each, instead
of monthly.
4.2 Increases in Annual Basic Rent. The Annual Basic Rent shall be
increased annually on each anniversary of the Measurement Date beginning with
the first anniversary of the Measurement Date. If Tenant remains in possession
of the Premises for any period of a partial year after the last anniversary of
the Measurement Date, then the increase in the Annual Basic Rent shall apply to
such partial year. If Tenant exercises any option to extend the Term, and unless
the instrument containing such option to extend the Term contains inconsistent
provisions for annual increases of the rent for the option term (which
provisions for increases in rent shall control over inconsistent provisions of
this
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Section), then the Annual Basic Rent for the option term shall be increased on
the first day of the option term and each anniversary thereof in accordance with
this Section 4.2 substituting the first day of such option term as a
"Measurement Date".
Each increase shall be determined as follows:
(a) The month immediately preceding the month in which the Measurement
Date occurs shall be the "Base Month". The same month occurring one year
later shall be the "Comparison Month". In each succeeding year, the most
recent Comparison Month shall be substituted as the Base Month, and the
next Comparison Month shall be the same calendar month occurring one year
later. The Annual Basic Rent for each succeeding full or partial year of
the Term beginning on each anniversary of the Measurement Date shall be
equal to the Annual Basic Rent then in effect increased by a percentage
equal to the percentage increase in the Index (defined below) for the
Comparison Month over the Index for the Base Month applicable to such year.
In no event shall the Annual Basic Rent for any year be less than the
Annual Basic Rent for the preceding year. The Monthly Basic Rent shall be
recomputed as one-twelfth (1/12) of the increased Annual Basic Rent and the
Monthly Basic Rent as recomputed shall be due in accordance with Section
4.1 of this Lease.
(b) The term "Index" shall mean the "Consumer Price Index for All
Urban Consumers, Los Angeles -- Anaheim Riverside CMSA, All Items,
(1982--1984=100)" compiled by the United States Department of Labor, Bureau
of Labor Statistics.
(c) If the Index is changed in any material respect, including without
limitation, any change in the base of the Index at 100 for 1982-1984, then
Landlord may at its election adjust the Index as appropriate to provide for
comparison of relative changes in prices of goods and services to consumers
in the area where the Index is measured. If the Bureau of Labor Statistics
shall cease to publish the Index, then Landlord shall substitute any
official index published by the Bureau of Labor Statistics or any successor
or similar governmental agency as may then be in existence and
substantially equivalent, and Landlord shall be entitled at its election to
make any adjustments in the substituted index, as appropriate, to provide
for comparison of relative changes in the prices of goods and services to
consumers in the area where the index is measured.
(d) The rent as increased by the annual rent increases shall be due
and payable regardless of notice of such increase by Landlord to Tenant;
provided, however, that Tenant shall not be in default because of payment
of less than the increased amount until Landlord notifies Tenant of the
increased amount of rent as long as Tenant pays the Monthly Basic Rent set
for the prior year when due, Tenant pays any deficiency to Landlord within
five (5) days after notice of the increased rent, and thereafter, Tenant
pays the increased amount as Monthly Basic Rent for such year.
4.3 Late Charges. If Tenant fails to pay any installment of rent within
five (5) days of the date due or if Tenant fails to make any other payment due
under this Lease within five (5) days of the date due, then Tenant shall pay to
Landlord a late charge equal to the greater of five percent (5%) of the amount
due or $100 to compensate Landlord for the extra cost incurred as a result of
such late payment.
ARTICLE V ADDITIONAL RENT.
5.1 Obligations to Pay Additional Rent. In addition to the Annual Basic
Rent and other sums to be paid by Tenant to Landlord, Tenant shall pay to
Landlord as additional rent the amount by which Tenant's share of Operating
Expenses (defined below) for any calendar year or part thereof during the Term
exceeds Tenant's Expense Stop Base. If the Basic Lease Provisions state the
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Tenant's Expense Stop Base in terms of a Base Year, then the Tenant's Expense
Stop Base shall be equal to the Tenant's share of Operating Expenses for such
Base Year. Tenant's share of Operating Expenses shall be an amount equal to the
product of the Operating Expenses times Tenant's Building Expense Percentage. If
any part of the Term begins or ends on any day other than the first or last day
of a calendar year respectively, then the annual Operating Expense and Tenant's
Expense Stop Base shall be prorated for such partial year on a daily basis using
a 30 day month and 360 day year to determine the amount of additional rent due
to Landlord.
5.2 Estimated Operating Expenses. Landlord shall be entitled to make a
reasonable estimate of Operating Expenses projected for each calendar year.
Landlord shall be entitled to revise such estimates at any time and from time to
time during the calendar year to increase or decrease the estimate of Operating
Expenses. If Landlord notifies Tenant that Landlord's estimate (or any revised
estimate) of Operating Expenses would result in an obligation of Tenant to pay
additional rent, then upon request by Landlord, Tenant shall pay one-twelfth
(1/12) of such estimated additional rent on the first day of each month in
advance together with the Monthly Basic Rent. If Landlord shall so notify Tenant
after the commencement of a calendar year, then with the next payment of Monthly
Basic Rent due, Tenant shall also pay to Landlord one--twelfth (1/12) of such
estimated additional rent for each month of such calendar year which has already
elapsed.
5.3 Annual Statement. Landlord shall provide Tenant with an annual
statement showing Tenant's share of the annual Operating Expenses over Tenant's
Expense Stop Base, if any, for the prior calendar year, together with any
proration. Landlord shall use all reasonable efforts to deliver the annual
statement within one hundred twenty (120) days after the end of the calendar
year; provided, however, that failure of Landlord to deliver the annual
statement within such period shall not impair or constitute waiver of Tenant's
obligations to pay additional rent or cause Landlord to incur any obligation for
damages. If the amount of the additional rent due for the calendar year exceeds
any amounts paid by Tenant as estimated additional rent for such calendar year,
then Tenant shall pay such excess to Landlord within ten (10) days of receipt of
the Landlord's statement. If the amounts paid as estimated additional rent for a
calendar year exceed the amount of Tenant's obligation shown on the annual
statement, then Tenant shall be entitled to a credit against monthly
installments of estimated additional rent due for the then current year. If no
further sums of additional rent are or will become due against which the excess
can be credited, then, subject to offset at Landlord's election against other
sums owed by Tenant, Landlord shall pay such excess to Tenant within ten (10)
days after delivery of the annual statement. If Landlord has not required Tenant
to pay installments of estimated additional rent, then Tenant shall pay Landlord
any sum of additional rent due within ten (10) days of any statement by Landlord
reflecting the amount of overall additional rent. All obligations to pay
additional rent and/or the obligation of Landlord to credit or reimburse Tenant
for any excess payment of estimated additional rent shall survive expiration of
the Term or earlier termination of this Lease.
Tenant shall have a period of thirty (30) days after delivery of the annual
statement of Operating Expenses to question or challenge the amount shown
thereon as being the annual Operating Expenses or Tenant's share thereof by
giving written notice to Landlord specifying the items which are challenged.
Tenant waives and relinquishes the right to challenge or object to the amounts
shown at any time after expiration of such thirty (30) day period. If Tenant
timely challenges any item shown on the annual statement, Tenant shall then have
a period of sixty (60) days in which to inspect during business hours upon
reasonable written notice to Landlord at Landlord's office Landlord's records
relating to the challenged item or items. Tenant shall give written notice to
Landlord prior to expiration of such sixty (60) day of whether Tenant continues
to challenge any of the items originally objected to, in which case a
certification as to proper amount shall be made, at Tenant's expense, by
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Landlord's independent certified public accountant, which certification shall be
final and conclusive. If Tenant fails to review the records or fails to give
timely written notice to Landlord that it continues to object, then Tenant shall
be deemed to have waived its objection and shall have no further right to
challenge or object thereto. Notwithstanding any objection or challenge of
Tenant, Tenant shall pay the amount claimed by Landlord to be due as and when
provided for herein, pending the resolution of Tenant's objection.
5.4 Operating Expenses. "Operating Expenses" of the Building and the
Project mean any and all costs and expenses of ownership, operation, management,
maintenance and repair of the Project and Building, including the parking
facilities and Common Areas. Operating Expenses include but are not limited to
each of the following costs and expenses:
(a) All costs and expenses of utilities furnished to the Building and
the Project including, without limitation, all costs and expenses
attributable to supply of electrical service, water and sewage service,
natural gas, cable television or other electronic or microwave signal
reception, telephone service or other communication, steam, heat, cooling,
or any other service which is now or in the future considered a utility
furnished to the Building and/or the Project.
(b) All real property taxes which shall include (i) any form of tax or
assessment, license fee, license tax, tax or excise on rent or any other
levy, charge, expense or imposition made or required by any federal, state,
county, city, district or other political subdivision on any interest of
Landlord and/or Tenant in the Premises, the Building, or the remainder of
the Project, including without limitation, the underlying real property and
appurtenances; (ii) any fee for services charged by any governmental agency
or quasi-governmental agency for any services such as fire protection,
street, sidewalk and road maintenance, refuse collection, school systems,
or other services provided or formerly provided to property owners and
residents within the general area of the Project at no cost or minimal
cost; (iii) any governmental impositions allocable to or measured by the
area of the Premises or the amount of any rent payable under this Lease,
including, without limitation, any tax on gross receipts or any excise tax
or other charges levied by any federal, state, county, city, district or
other governmental agency or political subdivision with respect to rent or
upon or with respect to the possession, leasing, operation, maintenance,
alteration, repair, use or occupancy of the Premises or any portion
thereof; (iv) any impositions by any governmental agency on this Lease
transaction or charge with respect to any document to which Tenant is a
party creating or transferring an interest or an estate in the Premises;
and (v) any increase in any of the foregoing based upon construction of
improvements on the Project or changes in ownership (as defined in the
California Revenue and Taxation Code) of the Property. Real property taxes
shall not include taxes on the Landlord's net income including state
franchise taxes or any inheritance, estate or gift taxes.
(c) The sum of building operating costs and common facilities costs
which shall include all costs of managing, operating and maintaining and
repairing the Project including all Common Areas and facilities of the
Project. Such costs shall include, without limitation, all expenses for
insurance obtained by Landlord (including, without limitation, public
liability, contractual liability, property damage, fire and extended
coverage, sprinkler damage, theft, malicious mischief and vandalism, flood,
rental loss, rent continuation, boiler and machinery, business
interruption, earthquake, all risk coverage, and other coverages in such
amounts as Landlord determines appropriate to carry in connection with
ownership and operation of a first class building in Los Angeles County,
California, or such other insurance as may be required by any present of
future lender on loans secured by the Project), labor and supplies,
license, permit and inspection fees, all assessments and special
assessments due to deed restrictions, declarations and/or owners
associations which accrue against the Project, the cost of compensation
(including employment taxes, similar governmental charges, and fringe
benefits) with respect to all persons who
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perform duties in connection with landscaping, janitorial, painting, window
washing and general cleaning services, security services and any other
services related to the operation, maintenance or repair of the Project (as
well as the cost of all personal property equipment used in conjunction
therewith), costs of clean-up and removal of Hazardous Materials (as
hereafter defined) and any fines and penalties imposed by reason of the
existence of Hazardous Materials on, in or about the Project, the fair
market rental value of the Project management office, management fees,
legal expenses and accounting expenses.
(d) If the Building is not at least 95% occupied during all or a
portion of any calendar year, then Landlord shall make an appropriate
adjustment of the Operating Expenses for such calendar year to determine
what the Operating Expenses would have been for such year if the Building
had been 95% occupied and the amount so determined shall be deemed to be
the amount of the Operating Expenses for the year. Such adjustment shall be
made by Landlord increasing those costs included in Operating Expenses
which in Landlord's judgment vary based upon the level of occupancy of the
Building to the amount of cost which in Landlord's judgment would have been
incurred if the Building had been 95% occupied for the entire calendar
year.
(e) Operating Expenses shall not include depreciation of or capital
expenditures made in connection with the Project or any equipment therein
or thereon, payments of principal and interest on any loans secured by the
Project, commissions paid for leasing, building construction permits and
fees, or costs of alteration of the Project; provided, however, that
Operating Expenses shall include the costs of any capital improvements made
to the Project for the purposes of reducing Operating Expenses or pursuant
to the requirements of any governmental entity, such costs to be amortized
over a reasonable period as Landlord shall determine, together with
interest on the unamortized balance at the rate of interest which would be
payable on sums due under this Lease at the time such capital improvements
are performed.
(f) Charges for any services, goods or materials furnished by Landlord
at Tenant's request and charges for services, goods and materials furnished
by Landlord as a result of uses or demands by Tenant in excess of those
charges which are normally furnished to other tenants in the Building with
general office usage, and all other sums payable by Tenant under this Lease
shall not be included in Operating Expenses but shall be payable by Tenant
pursuant to this Lease (or if not provided for in this Lease, within ten
(10) days after Landlord delivers a statement for such services, goods or
materials to Tenant). If any other tenant of the Project either pays sums
directly to third parties or specifically reimburses Landlord sums which
otherwise would be included in Operating Expenses, such payments or
reimbursements shall not be included in Operating Expenses for the purpose
of determining the amount of Operating Expenses allocable to Tenant.
ARTICLE VI SECURITY DEPOSIT.
Tenant has deposited with Landlord the Security Deposit in the amount set
forth in the Basic Lease Provisions. The Security Deposit shall be held by
Landlord as security for the performance and observance by Tenant of all
Tenant's obligations hereunder. If the Annual Basic Rent is increased during the
Term, then, within fifteen (15) days of notification by Landlord of the
increased Annual Basic Rent, without further notice, Tenant shall pay to
Landlord an additional amount to be held as part of the Security Deposit so that
the total Security Deposit held by Landlord is in the same proportion to the
increased Annual Basic Rent as the original Security Deposit bore to the
original Annual Basic Rent. No interest shall accrue with respect to the
Security Deposit. If Tenant performs and observes all of the terms, covenants
and conditions of this Lease which are required to be performed and observed by
it and pays all sums due Landlord, then Landlord shall return the Security
Deposit, or balance thereof then held by Landlord, without interest, to Tenant
within two weeks after Landlord recovers and accepts possession of the Premises.
If Tenant defaults,
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Landlord may, at its option and without notice, apply all or any part of the
Security Deposit in payment of rent or to cure any other default. If Landlord
does so, then Tenant shall, upon notice of such application, deposit with the
Landlord the amount so applied so that Landlord will have on hand at all times
during the Term the full amount of the Security Deposit. Landlord shall not be
required to hold the Security Deposit as a separate account, but may commingle
it with Landlord's other funds. In the event of a sale or other disposition of
the Premises, Landlord shall have the right to transfer the Security Deposit to
the new owner and deliver to Tenant the notice required by Section 1950.7 of the
Civil Code of California. Thereafter, Landlord shall be released by Tenant from
all responsibility for the return of such Security Deposit, and Tenant shall
look solely to the new owner for the return of such Security Deposit. If Tenant
assigns this Lease, Tenant's rights in the Security Deposit shall be deemed to
be assigned to the assignee, such Security Deposit shall be held by Landlord as
a Security Deposit made by the assignee and Landlord shall have no further
responsibility for the return of the Security Deposit to Tenant.
ARTICLE VII USE.
7.1 Use in General. Tenant shall use the Premises for the use set forth in
the Basic Lease Provisions and shall not use or permit the Premises to be used
for any other purpose without the prior written consent of Landlord, which may
be withheld by Landlord in its sole and absolute discretion. Nothing contained
herein shall be deemed to give Tenant any exclusive right to such use in the
Building. Tenant shall not use or occupy the Premises in violation of law, any
permit or the certificate of occupancy issued for the Building or the Premises.
Upon written notice from Landlord, Tenant shall discontinue any use of the
Premises which is declared by any governmental authority having jurisdiction to
be a violation of law, any permit or any certificate of occupancy. Tenant shall
comply with any direction of any governmental authority, having jurisdiction
which shall, by reason of the nature of Tenant's use or occupancy of the
Premises, impose any duty upon Tenant or Landlord respecting the Premises or use
or occupation thereof. Tenant shall not do or permit to be done anything which
will invalidate or increase the cost of any fire, extended coverage or any other
insurance policy covering the Project and/or property located therein and shall
comply with all rules, orders, regulations and requirements of any fire rating
bureau or any other organization performing a similar function. If Landlord
shall request Tenant to designate a fire warden or other responsible person from
among the persons regularly located at the Premises, Tenant shall make such
person available at reasonable times for training, briefing and drills. Tenant
shall promptly, upon demand, reimburse Landlord for any additional premium
charged for any insurance policy by reason of Tenant's failure to comply with
the provisions of this Article. Tenant shall not do or permit anything to be
done in or about the Premises which will in any way obstruct or interfere with
the rights of other tenants or occupants of the Building, or injure or annoy
them, or use or allow the Premises to be used for any improper, immoral,
unlawful or objectionable purpose, nor shall Tenant cause, maintain or permit
any nuisance in, on or about the Premises. Tenant shall not commit or suffer to
be committed any waste in or upon the Premises.
7.2 Hazardous Material. Tenant shall not bring, place, hold or dispose of
any Hazardous Material (defined hereafter) on, under or at the Premises, the
Building or the Project. Tenant shall not cause or allow any material with
asbestos, polychlorinated biphenyls (PCBS) or formaldehyde or other Hazardous
Materials to be incorporated into any improvements or alterations which it makes
or causes to be made to the Premises. Tenant shall comply with the requirements
of Section 25359.7(b) of the California Health and Safety Code to provide
Landlord with notice that any Hazardous Material has come to be located on the
Premises, the Building or the Project if Tenant discovers or suspects the
presence of such materials. Tenant shall not take any remedial action related to
Hazardous Materials located in or about the Premises, the Building or the
Project and shall not enter into a settlement, consent decree or compromise in
response to any claim related to Hazardous Materials without first notifying
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Landlord in writing of Tenant's proposed action and affording Landlord a
reasonable opportunity to appear, intervene, or otherwise participate in any
discussion or proceeding for the purposes of protecting Landlord's interest in
the Premises, the Building and the Project. Tenant shall immediately notify
Landlord in writing of (i) any enforcement, clean-up, removal or other
governmental action instituted, completed or threatened with regard to Hazardous
Materials involving the Premises, the Building or the Project, (ii) any claim
made or threatened by any person against Tenant, Landlord, the Premises, the
Building or the Project related to damage, contribution, cost recovery,
compensation, loss or injury resulting from or claimed to result from any
Hazardous Materials and (iii) any reports made to any environmental agency
arising out of or in connection with any Hazardous Materials at or removed from
the Premises, the Building or the Project, including any complaints, notices,
warnings or assertions of any violation in connection therewith.
In addition to any other indemnity contained in this Lease, Tenant hereby
shall defend, indemnify and hold Landlord harmless from and against any and all
losses, liabilities, general, special, consequential and/or incidental damages,
injuries, costs, expenses, claims of any and every kind whatsoever (including
without limitation, court costs, attorney's fees, damages to any person, the
Premises, the Building, the Project or any other property or loss of rents)
which at any time or from time to time may be paid, incurred or suffered by or
asserted against Landlord or, with respect to, or as direct or indirect result
of breach by Tenant of any of the covenants set forth in this Article, or to the
extent caused or allowed by Tenant, or any agent, employee, contractor, invitee
or licensee of Tenant, the presence on, under or the escape, seepage, leakage,
spillage, discharge, emission, release from, onto or into the Premises, the
Building, the Project, any land, the atmosphere, or any watercourse, body of
water or ground water of any Hazardous Material (including, without limitation,
any losses, liabilities, damages, injuries, costs, expenses or claims asserted
or arising under the Comprehensive Environmental Response, Compensation and
Liability Act, as amended, any so--called "Superfund" or "Superlien" law, the
Resource Conservation and Recovery Act, as amended, the Clean Water Act, as
amended, or any other federal, state, local or other statute, law, ordinance,
code, rule, regulation, permit, order or decree regulating, relating to or
imposing liability or standards of conduct of Hazardous Material). The
provisions of an undertaking and indemnification set forth in this Paragraph
shall survive the termination of this Lease and shall continue to be the
personal liability and obligation of Tenant, binding upon Tenant forever.
"Hazardous Material" means any hazardous, harmful, odorous, radioactive,
toxic or dangerous waste, substance or material, including, without limitation,
any hazardous substance or any pollutant or contaminant defined as such (or for
purposes of) the Comprehensive Environmental Response, Compensation and
Liability Act, as amended, or any "Superfund" or "Superlien" law, the Toxic
Substances Control Act, the Resource Conservation and Recovery Act, as amended,
the Clean Water Act, as amended, or any other federal, state or local statute,
law, ordinance, code, rule, regulation, permit, order or decree regulating,
relating to, or imposing liability or standards of conduct concerning, any
hazardous, toxic or dangerous waste, substance or material as is now or at any
time hereafter may be, in effect. Tenant's liability under this Section shall
extend to any and all such Hazardous Materials whether or not such substance was
defined, recognized or known or suspected of being toxic, dangerous or wasteful,
at the time of any act or emission giving rise to Tenant's liability. If Tenant
or its agents, employees or contractors cause any Hazardous Materials to be
located on or about the Premises, the Building or the Project, then Tenant shall
obtain insurance or other means of financial capability satisfactory to Landlord
to assure compliance with the obligations of Tenant related to Hazardous
Materials set forth in this Lease or otherwise now or in the future required by
law. Such assurance shall be on forms, in amounts and with persons as from time
to time reasonably requested by Landlord.
ARTICLE VIII TAXES ON TENANT'S PROPERTY.
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8.1 Payment By Tenant. Tenant shall be liable for and shall pay, at least
ten (10) days before delinquency, all taxes levied against any personal property
or trade fixtures located in or about the Premises. If any taxes on Tenant's
personal property or trade fixtures are levied against Landlord or Landlord's
property or if the assessed value of the Premises, the Building or the Project
is increased by the inclusion of the value of personal property or trade
fixtures located at the Premises in the assessed value of Landlord's property,
then Tenant shall pay to Landlord the amount of taxes reasonably determined by
Landlord as levied on Landlord's property or attributable to any increased
assessment within ten (10) days after delivery of notice of such amount by
Landlord.
8.2 Excess Taxes on Tenant Improvements. If the Tenant Improvements in the
Premises, whether installed, and/or paid for by Landlord or Tenant and whether
or not affixed to the real property so as to become a part thereof, are assessed
for real property tax purposes at a valuation higher than the valuation at which
Tenant Improvements conforming to Landlord's building standard for the Building
are assessed, then the real property taxes and assessments levied against the
Building by reason of such excess assessed valuation shall be deemed to be taxes
levied against personal property of Tenant and shall be governed by the
provisions of Section 8.1 above. If the records of the County Assessor are
available and sufficiently detailed to serve as a basis for determining whether
such Tenant Improvements are assessed at a higher valuation than Landlord's
building standard, such records shall be binding on both the Landlord and the
Tenant. If the records of the County Assessor are not available or not
sufficiently detailed to serve as a basis for making said determination, then
Landlord shall determine the real property or other taxes allocable to Tenant
based on Landlord's good faith estimate of the taxes attributable to the excess
of the actual cost of construction of the Tenant Improvements over Landlord's
estimate of the cost to construct Tenant Improvements according to building
standard.
ARTICLE IX CONDITION OF PREMISES.
9.1 Tenant's Obligations to Maintain. Tenant shall, at Tenant's sole cost
and expense, keep the Premises in good, clean and sanitary order. Tenant shall
use all electrical, gas and plumbing fixtures properly and keep them in a good,
clean and sanitary condition. Neither Tenant nor any subtenant, agent, employee
or contractor of Tenant shall destroy, deface, damage, impair or remove any part
of the Premises, the Building or the Project or the facilities, equipment or
appurtenances of the Premises, the Building or the Project. Tenant shall not
place any object or series of objects on the floors of the Premises in such a
manner as to exceed the load capacity of the floors on a per square inch basis
as determined by any architect, engineer or other consultant of Landlord, or as
otherwise limited by any law, code, regulation, permit or certificate of any
governmental authority. Tenant shall, at its sole cost and expense, make all
repairs to the Premises which are required to correct any damage or deficiency
caused by failure of Tenant to keep the Premises in the condition required by
this Section. Tenant shall reimburse Landlord for the cost of any repair to the
Premises, the Building or the Project required as a result of any misuse or
neglect committed or permitted by Tenant or by any subtenant, agent, employee or
contractor of Tenant. Tenant shall, at its sole cost and expense, repair or
reimburse Landlord for any damage to the Premises, the Building or the Project
caused by any person who has entered the Premises as a result of the express or
implied invitation or permission of Tenant. If Tenant does not make repairs
promptly and adequately or fails to maintain the Premises as required by this
Section within five (5) days after delivery of written notice of any deficiency
by Landlord (or if such deficiency cannot be reasonably corrected within five
(5) days and Tenant shall not commence to correct such deficiency within such
five (5) day period and diligently pursue completion of such correction, then
Landlord may, but shall not be required to, perform such repairs, maintenance
and/or correction to the Premises and any amounts expended by Landlord to
prosecute correction shall be reimbursed by Tenant to Landlord together with a
20% overhead
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charge upon demand; provided, however, that if in Landlord's judgment, there is
an emergency, Landlord may perform the repairs prior to delivery of notice to
Tenant or expiration of Tenant's cure period. If Landlord performs such repairs,
maintenance and/or corrections on behalf of Tenant, Landlord shall not be liable
to Tenant for any loss or damage that may accrue to Tenant's personal property,
trade fixtures and/or records and data occasioned or resulting from such repair,
maintenance and/or correction by Landlord. Entry by Landlord to pursue repair,
maintenance and/or correction shall not be deemed an actual or constructive
eviction and shall not entitle Tenant to any abatement or reduction of rent.
Tenant shall notify Landlord in writing promptly upon discovery of any damage,
defect or malfunction of any structural or mechanical portions of the Building
which Landlord is required to repair and maintain pursuant to Article 10 below.
9.2 Condition Upon Surrender. Upon expiration or earlier termination of
this Lease, Tenant shall remove from the Premises all movable furniture and
movable personal property, and shall promptly repair any damage to the Premises
or the Building caused by such removal. All removal and repair shall be at
Tenant's sole cost and expense. Tenant shall not remove any wall covering, floor
covering, shelving, cabinet units (whether for storage, for library purposes or
for any other purpose), or other improvements affixed to the Premises unless
requested to do so by Landlord. At any time within fifteen (15) days prior to
expiration of the scheduled Term, or within a reasonable time promptly after any
other termination of this Lease, Landlord may demand that Tenant remove from the
Premises any alterations, additions, improvements, fixtures, equipment,
shelving, cabinet units or other personal property designated by Landlord to be
removed. In such event Tenant shall complete such removal (including the repair
of any damage caused by such removal) entirely at its own expense and within
fifteen (15) days of Landlord's demand. All repairs required by Tenant in this
Section shall be performed in a manner satisfactory to Landlord, and shall
include, without limitation, the following: cap all plumbing, cap all electrical
wiring, repair all holes in walls, restore damage to the floors and/or ceiling,
repair any other cosmetic damage, and clean the Premises. If Tenant fails to
remove from the Premises all of its personal property (together with any other
items requested by Landlord to be removed in accordance with this Section) prior
to the expiration or earlier termination of this Lease, then Landlord may, at
its sole option (i) treat Tenant as a holdover in which event the provisions of
Article 26 of this Lease shall apply or (ii) handle the items as provided in
Section 19.2(b) of this Lease.
Unless Landlord demands otherwise pursuant to this Article, Tenant shall,
upon expiration or earlier termination of this Lease, surrender to Landlord the
Premises in the same condition as the Premises were upon delivery of possession
to Tenant, broom clean, reasonable wear and tear excepted, shall surrender all
keys to the Landlord at the place then fixed for the payment of rent, and shall
inform the Landlord of all combinations of locks, safes and vaults, if any, on
the Premises. Promptly upon request by Landlord following expiration or earlier
termination of this Lease, Tenant shall execute, acknowledge and deliver to
Landlord an instrument in recordable form releasing, remising and quitclaiming
to Landlord all right, title and interest of Tenant in the Premises by reason of
this Lease or otherwise.
ARTICLE X MAINTENANCE AND REPAIRS BY LANDLORD.
Landlord shall repair and maintain the structural and mechanical portions
of the Building, including basic plumbing, heating, ventilating, air
conditioning and electrical systems installed or furnished by Landlord, and
Landlord shall keep all Common Areas in good, clean and sanitary order;
provided, however, that if maintenance and repairs are caused in part or in
whole by the act, neglect, or omission of any duty by Tenant, its agents,
servants, employees or invitees, then Tenant shall pay to Landlord, as
additional rent, the reasonable cost of such maintenance and repairs. Landlord
shall not be liable for any failure to make any such repairs or to perform any
maintenance, and Tenant shall be entitled to any abatement or reduction in rent
by reason of such failure, no actual or
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constructive eviction of Tenant shall result from such failure, Tenant shall not
have the right to terminate this Lease, and Tenant shall not be relieved from
the performance of any covenant or agreement in this Lease because of such
failure. Except as provided in Article 17 hereof, there shall be no abatement of
rent and no liability of Landlord by reason of any injury to or interference
with Tenant's business arising from the making of any repairs, alterations or
improvements in or to any portion of the Building or the Premises or in or to
fixtures, appurtenances and equipment therein. Tenant hereby waives the
provisions of Section 1932, 1933(4) and 1942 of the Civil Code of California or
any similar or successor statutes to the fullest extent permitted by law and
Tenant acknowledges that Tenant shall not be entitled to terminate this Lease,
withhold rent or make any repair and deduct the cost of repair from rent payable
under this Lease in the event Landlord fails to make a repair or perform
maintenance. Tenant acknowledges that Tenant's sole remedy for breach of this
Article by Landlord shall be an action for damages.
ARTICLE XI ALTERATIONS.
Tenant shall make no alterations, additions or improvements in or to the
Premises without Landlord's prior written consent. If Tenant shall request
Landlord's consent for any alterations, additions or improvements, then Tenant
shall submit detailed plans, specifications and an itemized budget for making
such alterations, additions or improvements. Tenant shall pay to Landlord all
costs incurred by Landlord for any architectural, engineering, supervisory or
legal services in connection with making a determination concerning consent for
any alteration, addition or improvement requested by Tenant or in connection
with making any correction to any work or improvement performed by or at the
request of Tenant. Landlord may impose any conditions and the requirements to
any consent as Landlord shall in its discretion deem to be necessary or
advisable, including without limitation the hours when work may be performed.
Any approved alteration, addition or improvement shall be made only by
contractors or mechanics approved by Landlord. The review, approval, inspection
or examination by Landlord or any of its agents of any plans, specifications,
contractors or any other items shall be solely for Landlord's benefit and to
protect its interests, and neither Landlord nor its agents shall be deemed to
have assumed any responsibility for the quality of work of any contractor or the
accuracy, sufficiency, quality or suitability of such plans, specifications or
other items. Tenant agrees that there shall be no construction of partitions or
other obstructions which might interfere with Landlord's free access to
mechanical installations or service facilities of the Building or interfere with
the moving of Landlord's equipment to or from the enclosures containing said
installations or facilities. Tenant covenants and agrees that all work done by
Tenant shall be performed in full compliance with all laws, rules, orders,
ordinances, regulations, permits and requirements of any insurance rating bureau
used by insurers selected to carry Landlord's insurance, and of any similar
body. Before commencing any work, Tenant shall give Landlord at least ten (10)
days written notice of the proposed commencement of such work and shall, if
required by Landlord, secure at Tenant's own cost and expense, a completion and
lien indemnity bond satisfactory to Landlord for said work and such other
comprehensive general public liability insurance, builders risk insurance, and
other such insurance coverages so as to protect the insurable interests of
Landlord, Tenant, contractors and subcontractors in amounts and on forms as may
be requested by Landlord. Tenant further covenants and agrees that any
mechanic's lien filed against the Premises or against the Building for work
claimed to have been done, or materials claimed to have been furnished, will be
discharged by Tenant, by bond or otherwise, within ten (10) days after the
filing thereof, at the sole cost and expense of Tenant. All alterations,
additions or improvements upon the Premises made by either party, including
without limitation, all wall coverings, floor coverings, built-in cabinet work,
paneling and the like, shall, unless Landlord elects otherwise, become the
property of Landlord, and shall remain upon, and be surrendered with the
Premises, as a part thereof, at the end of the Term or upon earlier termination;
provided, however, that Landlord may, by written notice to Tenant, require
Tenant to remove all
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improvements, alterations and additions made by Tenant, and Tenant shall repair
all damage resulting from such removal or, at Landlord's option, shall pay to
Landlord all costs arising from such removal.
ARTICLE XII LIENS.
Tenant shall keep the Premises, the Building and the Project and all
underlying realty and appurtenances free from any mechanic's or materialmen's
liens and any other liens of a similar nature placed upon the Premises or any
realty of the Project by any reason of or in connection with any repairs,
additions, alterations or improvements contracted for or initiated by Tenant.
Tenant shall be solely responsible for making payment for such work and
discharging liens for such work. Tenant indemnifies Landlord fully with respect
to all liability for such liens, claims and demands, together with reasonable
attorneys fees and all costs and expenses in connection therewith. Landlord
shall have the right at all times to post on the Premises notices of
nonresponsibility (and to record verified copies thereof) in order to place
contractors and materialmen on notice that Landlord is not to be held
financially responsible for such work. Tenant shall, at the request of Landlord,
provide Landlord with executed and acknowledged full and unconditional lien
releases in recordable form and paid receipts from any general contractor,
subcontractor, materialman or other person furnishing labor and/or materials in
connection with any work connected with the Premises, as well as any other
evidence required by Landlord to demonstrate that there are no liens affecting
Landlord or any property of Landlord by reason of such work. Any amount paid by
Landlord to discharge or bond around any liens shall be payable by Tenant to
Landlord upon demand. Tenant shall be permitted to contest the validity of any
such lien, claim or demand provided Tenant acquires and records a bond in an
amount, in a form and from a surety reasonably satisfactory to Landlord and
Tenant shall, at its sole cost and expense, defend itself and Landlord with
counsel reasonably satisfactory to Landlord. Tenant shall pay and satisfy any
adverse judgment that may be rendered prior to any action taken to enforce such
judgment against Landlord or the Project.
ARTICLE XIII ENTRY BY LANDLORD.
Landlord reserves and shall at any and all times have the right to enter
the Premises to inspect the same, to supply janitorial service and any other
service to be provided by Landlord to Tenant hereunder, to show the Premises to
prospective purchasers or tenants, to post notices of nonresponsibility, to
alter, improve or repair the Premises or any other portion of the Building, all
without such entry constituting any actual or constructive eviction of Tenant
and without abatement of rent. Landlord may, in order to carry out such
purposes, erect scaffolding and other necessary structures where reasonably
required by the character of the work to be performed, provided that Landlord
shall use reasonable efforts to minimize interference with the business of
Tenant. Tenant hereby waives any claim for damages, for any injury or
inconvenience to or interference with Tenant's business, any loss of occupancy
or quiet enjoyment of the Premises, and any other loss in, upon and about the
Premises. Landlord shall at all times have and retain a key with which to unlock
all doors in the Premises, excluding Tenant's vaults and safes. Landlord shall
have the right to use any and all means which Landlord may deem proper to open
said doors in an emergency in order to obtain entry to the Premises. Any entry
to the Premises obtained by Landlord by any of said means, or otherwise, shall
not be construed or deemed to be a forcible or unlawful entry into the Premises,
or an eviction of Tenant from the Premises or any portion thereof, and any
damages caused on account thereof shall be paid by Tenant. No provision of this
Article shall be construed as obligating Landlord to perform any repairs,
alterations or decorations except as otherwise expressly agreed herein by
Landlord.
ARTICLE XIV UTILITIES AND SERVICES.
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Provided that Tenant is not in default under this Lease, Landlord agrees to
furnish or cause to be furnished to the Premises the utilities and services
described in the Standards for Utilities and Services, attached hereto as
Exhibit "C". Tenant agrees to perform and be bound by all of the provisions of
Exhibit "C". Interruption of utilities or services or Landlord's failure to
furnish any of such utilities or services when such interruption or failure is
caused by (i) accident, breakage, or repairs, (ii) strikes, lockouts or other
labor disturbance or labor dispute of any character, (iii) governmental
regulation, moratorium or other governmental action, (iv) inability despite the
exercise of reasonable diligence to obtain electricity, gas, water or fuel, (v)
limitation, rationing, curtailment or restriction on the use of water,
electricity, gas, heating, cooling or other forms of service or utility provided
to the Premises or the Building, or (vi) any other cause beyond Landlord's
reasonable control, shall not give rise to a claim for damages against Landlord
or otherwise result in any liability to Landlord. In addition, Tenant shall not
be entitled to any offset, abatement or reduction of rent by reason of such
failure, no actual or constructive eviction of Tenant shall result from such
failure and Tenant shall not be relieved from the performance of any covenant or
agreement in this Lease because of such failure. In the event of any failure,
stoppage or interruption thereof, Landlord shall diligently attempt to resume
service promptly.
ARTICLE XV BANKRUPTCY.
If Tenant shall file a petition in bankruptcy under any provision of the
Bankruptcy Code as then in effect, or if Tenant shall be adjudicated a bankrupt
in involuntary bankruptcy proceeding and such adjudication shall not have been
vacated within sixty (60) days from the date thereof, or if a receiver,
disbursing agent or trustee shall be appointed for Tenant's property and the
order appointing such receiver, disbursing agent or trustee shall not be set
aside or vacated within sixty (60) days after the entry thereof, or if Tenant
shall be adjudicated a bankrupt in any involuntary bankruptcy proceeding and
such adjudication shall not have been vacated within sixty (60) days from the
date thereof, or if a receiver, disbursing agent or trustee shall be appointed
for Tenant's property and the order appointing such receiver, disbursing agent
or trustee shall not be set aside or vacated within sixty (60) days after the
entry thereof, or if Tenant shall assign its estate or effects for the benefit
of creditors, or if this Lease shall, by operation of law or otherwise, pass to
any person or persons other than Tenant, then Landlord may elect to terminate
this Lease, with or without notice of such election and with or without entry or
action by Landlord. In the event of such termination, notwithstanding any other
provisions of this Lease, Landlord, in addition to any and all rights and
remedies allowed by law or equity, shall, upon such termination, be entitled to
recover damages in the amount provided in Section 19.2(a) hereof. In the event
of such termination, neither Tenant nor any person claiming through or under
Tenant or by virtue of any statute or order of any court shall be entitled to
possession of the Premises but shall surrender the Premises to Landlord. Nothing
contained herein shall limit or prejudice the right of Landlord to recover
damages by reason of any such termination equal to the maximum amount allowed by
any statute or rule of law in effect at the time when, and governing the
proceedings in which, such damages are to be proved, whether or not such amount
is greater, equal to, or less than the amount of damages recoverable under the
provisions of this Article.
ARTICLE XVI INDEMNITY AND INSURANCE.
16.1 Tenant's Indemnity. Tenant shall protect, defend, indemnify and hold
Landlord, its partners, shareholders, officers, directors, trustees, employees,
agents, authorized representatives and contractors (collectively, "Landlord's
Affiliates") harmless from and against any and all claims, demands, judgments,
loss, cost, expense, liability, damage or injury to property or persons,
resulting from or occurring by reason of: (a) the use, occupancy or nonoccupancy
of the Premises or by the actions or inactions, whether or not negligent of
Tenant and/or any subtenant, and their agents, officers, employees, contractors,
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customers, invitees, or licensees whether the active or passive negligence of
Landlord was or is a contributing factor; (b) any default or breach of this
Lease by Tenant; and (c) the failure of Tenant or any other occupant to
surrender possession of the Premises upon the expiration or earlier termination
of this Lease in accordance with the provisions of this Lease, either due to
failure of Tenant to timely perform its obligations for removal and repair of
personal property or any other reason, which indemnity shall include without
limitation any claims made by any succeeding Tenant founded upon such delay;
provided, however, that Tenant shall not be obligated to so indemnify Landlord
or any of Landlord's Affiliates from matters arising from or caused by the sole
willful misconduct or gross negligence of Landlord or any of Landlord's
Affiliates each acting within the scope of their authority on behalf of
Landlord. Payment of any sum by Landlord shall not be a condition precedent to
Tenant's obligations hereunder. If Tenant is required to defend Landlord, then
Landlord shall be entitled to select its own defense counsel and Tenant shall
pay on behalf of, or to, Landlord all defense expenses incurred by, Landlord
including, without limitation, reasonable attorneys fees and expenses, fees of
experts and accountants and court costs.
16.2 Tenant's Insurance. Tenant shall carry at its own expense throughout
the Term of this Lease, comprehensive general public liability insurance
covering the Premises and, appurtenant areas, and Tenant's use thereof, and,
covering Tenant's contractual liability under this Lease in an amount
periodically adjusted to conform to then current standard business practices for
comparable business operations, but in no case less than $2,000,000 in combined
single limit and general aggregate coverage for bodily injury or death, personal
injury and property damage. Tenant shall keep in full force and effect a policy
or policies of Worker's Compensation insurance as required by law and with
employer's liability coverage of not less than $500,000 per employee and per
occurrence. The amounts of general liability and employer's liability insurance
shall be increased on the third anniversary of the Measurement Date and every
third anniversary thereafter to an amount reasonably determined by Landlord as
may be required, given the then current economic conditions and the size of
damage awards generally, to approximate the same level of protection as was
provided on the Commencement Date. Tenant shall provide Landlord with copies of
insurance policies or other evidence of such insurance coverage prior to the
Commencement Date of the Lease and shall provide to Landlord copies of
replacement policies at least thirty (30) days prior to the date of expiration
of a policy. A binder or certificate of insurance shall be sufficient evidence
of insurance pending issuance of a policy; provided, however, that Tenant shall
forward a copy of each policy to Landlord when issued. Such insurance policies
shall be on forms reasonably acceptable to Landlord and such policies shall be
on an occurrence basis. Such insurance shall name Landlord and any management
agent from time to time designated by Landlord and any lender of Landlord as
additional insureds, and shall provide that coverage of additional insureds
shall be primary and that any insurance maintained by Landlord shall be excess
only. Such insurance shall provide that the interests of Landlord, Tenant and
other insureds shall be severable such that the act or omission of one insured
shall not avoid or reduce the coverage of other insureds. Such insurance shall
contain endorsements (i) stating that the insurer agrees to notify Landlord not
less than thirty (30) days in advance of modification or cancellation thereof,
(ii) deleting any employee exclusion on personal injury coverage, (iii)
including employees as additional insureds, (iv) deleting any exclusion from
liability caused by serving alcoholic beverages incidental to Tenant's business,
and (v) providing for coverage for employer's nonowned automobile liability.
Failure of Tenant to maintain insurance coverages required by this Lease for any
time period during the Term or failure of Tenant to deliver evidence of
insurance or copies of policies shall be material defaults under this Lease.
16.3 Tenant's Property. Tenant agrees that all personal property of
whatever kind, including, without limitation, inventory and/or goods stored at
or about the Premises, Tenant's trade fixtures and Tenant's interest in tenant
improvements which may be at any time located in, on or about the Premises, the
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Building, whether owned by Tenant or third parties shall be at Tenant's sole
risk or at the risk of those claiming through Tenant, and that Landlord shall
not be liable for any damage to or loss of such property except for loss or
damage arising from or caused by the sole gross negligence of Landlord or any of
Landlord's officers, employees, agents or authorized representatives each acting
within the scope of their authority. Tenant shall obtain and maintain policies
of fire and extended coverage and sprinkler damage insurance covering the full
replacement cost of all such property.
16.4 Form of Insurance Policies. All insurance policies required of Tenant
by this Lease shall be obtained from insurers doing business in California
having a rating of A XIII or better in the current issue of "Best's Insurance
Guide". All loss payable clauses shall name Landlord as a loss payee and/or
conform to the requirements of any mortgage lenders. Tenant's insurance may,
provided Tenant obtains the prior written approval of Landlord (which approval
shall not be unreasonably withheld), provide for deductibles in reasonable
amounts. If Tenant requests approval of a deductible, Tenant shall provide
evidence of financial responsibility reasonably satisfactory to Landlord to pay
the deductible amount in the event of a loss. Any policy of insurance required
to be maintained by Tenant under this Lease may be maintained under a policy
commonly referred to as a "blanket policy" insuring other parties and/or other
locations; provided however, that the amount of insurance and the scope and type
of coverage shall conform to the requirements contained in this Lease.
16.5 Exemption of Landlord From Liability. Except in the event of
Landlord's sole gross negligence or willful misconduct, Tenant hereby agrees
that Landlord (including Landlord's officers, trustees, partners, affiliates,
directors, agents, management contractors and representatives (collectively
referred to as "Landlord's Affiliates") shall not be liable for injury to
Tenant's business or loss of income therefrom or for damage to the goods, wares,
merchandise or other property of Tenant, Tenant's employees, invitees,
customers, or any other person in or about the Premises. Tenant further agrees
that Landlord and Landlord's Affiliates shall not be liable for injury to the
person of Tenant, Tenant's employees, agents or contractors or to Tenant's
property, whether such damage or injury is caused by or results from fire,
steam, electricity, gas, water or rain, or from the breakage, leakage,
obstruction or other defects of pipes, sprinklers, wires, appliances, plumbing,
heating, ventilation, air conditioning, or lighting fixtures, or from any other
cause, whether damage or injury results from conditions arising upon the
Premises or upon other portions of the Building or the Project, or from other
sources or places appurtenant to the Premises and regardless of whether the
cause of such damage or injury or the means of repairing the same is
inaccessible to Tenant. Landlord and Landlord's Affiliates shall not be liable
for any damages arising from any act or neglect of any other tenant, if any, of
the Building or the Project.
16.6 Waiver of Subrogation, Landlord and Tenant hereby release each other
from any and all liability for any loss, damage or injury to person or property
occurring in, on or about or to the Premises, improvements to the Building, or
person or property in, on or about or to the Premises, improvements to the
Building or personal property within the Building by reason of fire or other
casualty which is required: to be insured against, as stipulated in this Lease
under a standard fire and extended coverage insurance policy, regardless of
cause, including the negligence of Landlord or Tenant. Each party shall notify
their insurance carrier of this waiver of subrogation. If Tenant's insurer fails
to obtain a waiver of subrogation against Landlord, then Landlord's obligation
to obtain a waiver of subrogation shall cease and terminate.
16.7 Waiver of Damages. Tenant hereby acknowledges that the City may from
time to time impose certain restrictions which will affect Tenant, its employees
and visitors during such times as it may chose to schedule/sponsor/cooperate
with various municipal and or private party events. Such restrictions may
provide for limited vehicular and pedestrian access to the Building, its parking
facilities,
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and the public streets, sidewalks and rights-of-way surrounding them. Such
restrictions may apply from before the commencement until after the conclusion
of each event. Tenant acknowledges that such restrictions will interfere with
vehicular and pedestrian access to the Building and its parking facilities.
Tenant hereby waives all claims against Landlord for damages, losses and
expenses of any kind whatsoever arising from or related to the imposition of
such restrictions.
ARTICLE XVII DAMAGE OR DESTRUCTION.
If either the Building, the Project or the Premises should be partially or
wholly destroyed or damaged by fire or other casualty and such damage or
destruction cannot in Landlord's judgment be repaired or substantially restored
within 180 days of the date of such damage or destruction, then Landlord shall
so notify Tenant and either party hereto may, at its option, terminate this
Lease by giving written notice thereof to the other party within 30 days after
the date of such casualty. In such event, rent shall be apportioned to and shall
cease as of the date of such casualty. If neither party exercises this option,
then the Premises shall be reconstructed and restored, at Landlord's expense, to
substantially the same condition as they were prior to the casualty, provided
that, if Tenant has made any alterations, additions or improvements pursuant to
Article 11 or if tenant improvements have been constructed at a cost in excess
of costs paid or reimbursed by Landlord, then Tenant shall reimburse Landlord
for the excess cost of reconstructing the same whether or not the cost of
restoration exceeds the cost of initial construction. In the event of such
reconstruction, rent shall be abated in proportion to the area of the Premises
not capable of use by Tenant from the date of the casualty until substantial
completion of the reconstruction repairs and this Lease shall continue in full
force and effect for the balance of the Term.
If the Project, the Building or the Premises should be damaged by fire or
other casualty and, in Landlord's judgment, the Premises can be substantially
restored within 180 days of the date of such damage, then such damaged part of
the Premises shall be reconstructed and restored, at Landlord's expense, to
substantially the same condition as they were prior to the casualty, provided
that if Tenant has made any alterations, additions or improvements or if tenant
improvements have been constructed for a cost in excess of amounts paid by
Landlord, then Tenant shall reimburse Landlord for the excess cost of
reconstructing the same whether or not the cost of reconstruction exceeds cost
of initial construction. Rent shall be abated in the proportion which the
approximate area of the damaged and destroyed portion of the Premises bears to
the total area in the Premises from the date of the casualty until substantial
completion of the reconstruction repairs; and this Lease shall continue in full
force and effect for the balance of the Term. Landlord shall use reasonable
diligence in completing such reconstruction repairs.
Notwithstanding anything else to the contrary contained in this Article 17,
Landlord shall have no obligation to pay for the repair or restoration of damage
or destruction to the Premises caused by fire or other casualty more than the
amount of the insurance proceeds payable for the benefit of Landlord by reason
of such damage or destruction, plus any amounts actually paid by Tenant for the
excess of the cost of reconstructing tenant improvements over the original cost
of such tenant improvements paid initially by Landlord.
ARTICLE XVIII EMINENT DOMAIN.
If the whole or any part of the Premises or appurtenant areas shall be
taken for public or quasi-public use by a governmental or other authority having
the power of eminent domain or shall be conveyed to such authority in lieu of
such taking, and if such taking or conveyance shall cause the remaining part of
the Premises or appurtenant areas not so taken to be untenantable and inadequate
for use by Tenant, then this Lease shall terminate as of the date of such
taking. If a part of the Premises and/or appurtenant areas shall be taken or
conveyed but
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the portion, remaining after restoration can be made usable for Tenant's
purposes, then this Lease shall not be terminated as provided for in this
Article 18, but this Lease shall be terminated only as to the portion of the
Premises (without consideration of appurtenant areas) taken or conveyed as of
the date Tenant surrenders possession of such portion of the Premises, and
Landlord shall make such repairs, alterations and improvements as may be
necessary to render any part not taken or conveyed tenantable; provided,
however, Landlord shall have no obligation to pay for such repairs, alterations
and improvements more than the amount of such award payable for the benefit of
Landlord for such taking, and the rent shall be reduced proportionately to the
amount (based on square footage) of the Premises taken. All compensation awarded
for such taking or conveyance shall be the property of Landlord without any
deduction therefrom for any present or future estate of Tenant, and Tenant
hereby assigns to Landlord all of its right, title and interest in and to any
such award. Tenant shall have no claim against Landlord or against the condemnor
for the value of any unexpired portion of the term of this Lease or otherwise,
and Tenant shall not be entitled to any part of any award that may be made for
such taking. However, Tenant shall have the right to recover from such
authority, but not from Landlord, such compensation as may be awarded to Tenant
on account of moving and, relocation expenses and depreciation to and removal of
Tenant s trade fixtures and personal property. It is further understood and
agreed that neither the Tenant nor the Landlord shall have any rights in any
award made to the other by any condemnation authority.
ARTICLE XIX DEFAULTS AND REMEDIES.
19.1 Tenant's Default. The occurrence of any one or more of the following
events shall be a default and breach of this Lease by Tenant:
(a) Tenant fails to pay any rent payment or other sum due under this
Lease within five (5) days after the same shall be due and payable.
(b) Tenant fails to perform or observe any term, condition, covenant
or obligation required to be performed or observed by it under this Lease
for a period of thirty (30) days (or such shorter time provided herein)
after notice thereof from Landlord; provided, however, that if the term,
condition, covenant or obligation to be performed by Tenant is of such
nature that the same cannot reasonably be cured within thirty (30) days and
if Tenant commences such performance within said thirty-day (30) period and
thereafter diligently undertakes to complete the same, then such failure
shall not be a default hereunder if it is cured within sixty (60) days
following Landlord's notice.
(c) Tenant vacates or abandons, or fails to occupy the Premises, or
any substantial portion thereof, for a period of fourteen (14) days.
(d) A trustee, disbursing agent, or receiver is appointed to take
possession of all or substantially all of Tenant's assets in, on or about
the Premises or of Tenant's interest in this Lease (and Tenant or any
guarantor of Tenant's obligations under this Lease does not regain
possession within sixty (60) days after such appointment); Tenant makes an
assignment for the benefit of creditors; or all or substantially all of
Tenant's assets in, on or about the Premises or Tenant's interest in this
Lease are attached or levied upon under execution (and Tenant does not
discharge the same within sixty (60) days thereafter).
(e) A petition in bankruptcy, insolvency, or for reorganization or
arrangement is filed by or against Tenant or any guarantor of Tenant's
obligations under this Lease pursuant to any federal or state statute, and,
with respect to any such petition filed against it, Tenant or such
guarantor fails to secure a stay or discharge thereof within sixty (60)
days after the filing of the same.
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(f) Immediately, in the event of any assignment, subletting or other
transfer for which the prior written consent of the Landlord has not been
obtained.
(g) Immediately, in the event of discovery of any false or misleading
statement concerning financial information submitted by Tenant to Landlord
in connection with obtaining this Lease or any other consent or agreement
by Landlord.
19.2 Landlord's Remedies. Upon the occurrence of any event of default,
Landlord shall have the following rights and remedies, in addition to those
allowed by law or in equity, any one or more of which may be exercised or not
exercised without precluding the Landlord from exercising any other remedy
provided in this Lease or otherwise allowed by law or in equity:
(a) Landlord may terminate this Lease and Tenant's right to possession
of the Premises. If Tenant has abandoned and vacated the Premises, the mere
entry of the Premises by Landlord in order to perform acts of maintenance,
cure defaults, preserve the Premises, or to attempt to relet the Premises,
or the appointment of a receiver in order to protect the Landlord's
interest under this Lease, shall not be deemed a termination of Tenant's
right to possession or a termination of this Lease unless Landlord has
notified Tenant in writing that this Lease is terminated. Notification of
any default in Section 19.1 of this Lease shall be in lieu of, and not in
addition to, any notice required under Section 1161, et seq., of the
California Code of Civil Procedure. If Landlord terminates this Lease and
Tenant's right to possession of the Premises pursuant to this Subsection
19.2(a), then Landlord may recover from Tenant:
(i) The worth at the time of the award of unpaid rent which had
been earned at the time of termination; plus
(ii) The worth at the time of the award of the amount by which
the unpaid rent which would have been earned after termination until
the time of award exceeds the amount of such rental loss that Tenant
proves could have been reasonably avoided; plus
(iii) The worth at the time of the award of the amount by which
the unpaid rent for the balance of the term after the time of the
award exceeds the amount of such rental loss that Tenant proves could
be reasonably avoided; plus
(iv) Any other amounts necessary to compensate the Landlord for
all of the detriment proximately caused by Tenant's failure to perform
its obligations under this Lease which in the ordinary course of
things would be likely to result therefrom, including, without
limitation, any legal expenses, brokers commissions or finders fees
(in connection with reletting the Premises and the pro rata portion of
any leasing commission paid by Landlord in connection with this Lease
which is applicable to the portion of the Term, including option
periods, which is unexpired as of the date on which this Lease
terminated), the costs of repairs, cleanup, refurbishing, removal and
storage or disposal of Tenant's personal property, equipment, fixtures
and anything else that Tenant is required under this Lease to remove
but does not remove (including those alterations which Tenant is
required to remove pursuant to an election by Landlord and Landlord
actually removes whether or not notice to remove shall be delivered to
Tenant), and any costs for alterations, additions and renovations
incurred by Landlord in regaining possession of and reletting (or
attempting to relet) the Premises. Tenant shall also reimburse
Landlord for the pro rata portion of leasehold improvement costs paid
by Landlord to install leasehold improvements on the Premises which is
applicable to that portion of the Term including any option periods
which is unexpired as of the date of this Lease discounted to present
value.
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All computations of the "worth at the time of the award" of amounts
recoverable by Landlord under Subsections (i) and (ii) hereof shall be
computed by allowing interest at the maximum lawful contract rate per
annum. The "worth at the time of the award" recoverable by Landlord under
Subsection (iii) and the discount rate for purposes of determining any
amounts recoverable under Subsection (iv), if applicable, shall be computed
by discounting the amount recoverable by Landlord at the discount rate of
the Federal Reserve Bank of California San Francisco at the time of the
award plus one percent (1%). If Tenant tenders to Landlord sums in an offer
of settlement of payment of any sums due under this Subsection 19.2(a)
after Landlord has notified Tenant of exercise of the remedies under this
Subsection 19.2(a), then the "worth at the time of the award" shall be
determined at the time a lawful tender of payment of the entire amount of
such sums by Tenant.
(b) Upon termination of this Lease, whether by lapse of time or
otherwise, Tenant shall immediately vacate the Premises and deliver
possession to Landlord. If Tenant has vacated the Premises and Landlord or
any of its agents have reason to believe that Tenant does not intend to
reoccupy the Premises, and current or past rent has been due or unpaid for
at least fourteen (14) consecutive days, then Landlord shall have the right
to send Tenant a notice of belief of abandonment pursuant to Section 1951.3
of the California Civil Code. The Premises will be deemed abandoned, and
the Tenant's right to possession of the Premises will terminate on the date
set forth in such notice, unless Landlord receives (at its address for
notices set forth in this Lease) before such date a notice from Tenant
stating (i) Tenant's intent not to abandon the Premises, and (ii) an
address at which Tenant may be served in any action for unlawful detainer
of the Premises and/or damages and other relief available at law or in
equity. If the Premises are deemed abandoned (either through the
aforementioned procedure or due to any statement by Tenant to that effect)
or if Landlord or any of its agents acts pursuant to a court order, then
Landlord or any of its agents shall have the right, without terminating
this Lease, to re-enter the Premises and remove all persons therefrom and
any or all of Tenant's fixtures, equipment, furniture and other personal
property (herein collectively referred to as "Property") from the Premises,
without being deemed in any manner liable for trespass, eviction, or
forcible entry or detainer, or conversion of Property, and without
relinquishing any right given to Landlord under this Lease or by operation
of law. If Landlord re-enters the Premises in such situation, all Property
removed from the Premises by Landlord or any of its agents and not claimed
by the owner may be handled, removed, or stored, in a commercial warehouse
or otherwise by Landlord at Tenant's risk and expense, and Landlord shall
in no event be responsible for the value, preservation or safekeeping
thereof. Before retaking of any such Property from storage, Tenant shall
pay to Landlord, upon demand, all expenses incurred in such removal and all
storage charges against such Property. Any such Property of Tenant not so
retaken from storage by Tenant within thirty (30) days after such Property
is removed from the Premises shall be deemed abandoned and may be either
disposed of by Landlord pursuant to Section 1988 of the California Civil
Code or retained by Landlord as its own property.
(c) Notwithstanding Landlord's right to terminate this Lease pursuant
to Section 19.2(a), Landlord may, at its option, even though Tenant has
breached this Lease and abandoned the Premises, continue this Lease in full
force and effect and not terminate Tenant's right to possession, and
enforce all of Landlord's rights and remedies under this Lease, including
the right to recover rent as it becomes due under this Lease pursuant to
Section 1951.4 of the California Civil Code. In such event Landlord shall
be entitled to recover from Tenant all costs of maintenance and
preservation of the Premises, and all costs, including attorneys fees and
receivers fees, incurred in connection with appointment of and performance
by a receiver to protect the Premises and Landlord's interest under this
Lease. No reentry or taking possession of the Premises by Landlord pursuant
to this Section 19.2(c) shall be construed as an election to terminate this
Lease unless a written notice (signed by a duly authorized representative
of Landlord) of intention to terminate this Lease is
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given to Tenant. Landlord may at any time after default by Tenant elect to
terminate this Lease pursuant to Section 19.2(a), notwithstanding
Landlord's prior continuance of this Lease in effect for any period of
time, and upon and after Tenant's default under this Lease, Landlord may,
but need not, relet the Premises or any part thereof for the account of
Tenant to any person, firm, partnership, corporation or other business
entity for such rent, for such time and upon such terms as Landlord, in its
sole discretion, shall determine. Subject to the provisions of this Lease
regarding assignment and subletting in Article 20, Landlord shall not be
required to accept any substitute tenant offered by Tenant or to observe
any instructions given by Tenant regarding such reletting. Landlord may
remove (and repair any damage caused by such removal) and store (or dispose
of) any of Tenant's personal property, equipment, fixtures, and anything
else Tenant is required (under this Lease at the election of Landlord or
otherwise) to remove but does not remove, and Landlord may also make
repairs, renovations, alterations and/or additions to the Premises to the
extent deemed by Landlord necessary or desirable in connection with any
attempt to relet the Premises, Tenant shall upon demand pay the cost of
such repairs, alterations, additions, removal, storage and renovations,
together with any legal expenses, brokers commissions or finders fees and
any other expenses incurred by Landlord in connection with entry of the
Premises and attempting to relet the Premises. If Landlord is able to relet
the Premises for Tenant's account during the remaining portion of the Term
and the consideration collected by Landlord from any reletting is not
sufficient to pay monthly the full amount of rent and additional rent
payable by Tenant under this Lease, together with any legal expenses,
brokers commissions or finders fees, any cost for repairs, alterations,
additions, removal, storage and renovations, and any other cost and expense
incurred by Landlord in re-entering the Premises and reletting the
Premises, then Tenant shall pay to Landlord the amount of each monthly
deficiency upon demand. Any rentals received by Landlord from any such
reletting shall be applied as follows:
(i) First, to the payment of any indebtedness other than rent due
hereunder from Tenant to Landlord;
(ii) Second, to the payment of any costs of reentry and reletting
the Premises;
(iii) Third, to the payment of costs of any such alterations,
repairs, additions, removal, storage and renovations to the Premises;
(iv) Fourth, to the payment of rent due and unpaid under this
Lease; and
(v) The residue, if any, shall be held by Landlord and applied as
payment of future rent as the same may become due and payable under
this Lease.
(d) No act or omission by Landlord or its agents during the Term shall
be an acceptance of a surrender of the Premises and no agreement to accept
a surrender of the Premises shall be valid unless made in writing and
signed by a duly authorized representative of Landlord. Neither any remedy
set forth in this Lease nor pursuit of any particular remedy shall preclude
Landlord from any other remedy set forth in this Lease or otherwise
available at law or in equity. Landlord shall be entitled to a restraining
order or injunction to prevent Tenant from breaching or defaulting under
any of its obligations under this Lease other than the payment of rent or
other sums due hereunder.
(e) Neither the termination of this Lease nor the exercise of any
remedy under this Lease or otherwise available at law or in equity shall
affect the right of Landlord to any right of indemnification set forth in
this Lease or otherwise available at law or in equity for any act or
omission of Tenant, and all rights to indemnification or other obligations
of Tenant are
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intended to be performed after termination of this Lease shall survive
termination of this Lease and termination of Tenant's right to possession
under this Lease.
19.3 Default By Landlord And Remedies Of Tenant. It shall be a default and
breach of this Lease by Landlord if it shall fail to perform or observe any
term, condition, covenant or obligation required to be performed or observed by
it under this Lease for a period of thirty (30) days after notice thereof from
Tenant; provided, however, that if the term, condition, covenant or obligation
to be performed by Landlord is of such nature that the same cannot reasonably be
performed within such thirty (30) day period, such default shall be deemed to
have been cured if Landlord commences such performance within said thirty (30)
day period and thereafter diligently undertakes to complete the same.
Tenant shall not have the right based upon a default of Landlord to
terminate this Lease or to withhold, offset or xxxxx rent, Tenant's sole
recourse for Landlord's default being an action for damages against Landlord for
diminution in the rental value of the Premises for the period of Landlord's
default, which is proximately caused by Landlord's default. Tenant shall not
have the right to terminate this Lease or to withhold, offset or xxxxx the
payment of rent based upon the unreasonable or arbitrary withholding by Landlord
of its consent or approval of any matter requiring Landlord's consent or
approval, including but not limited to any proposed assignment or subletting,
Tenant's remedies in such instance being limited to a declaratory relief action,
specific performance, injunctive relief or an action of actual damages. Tenant
shall not in any case be entitled to any consequential or punitive damages based
upon any Landlord default or withholding of consent or approval. Notwithstanding
anything to the contrary contained in this Lease, Tenant agrees and understands
that Tenant shall look solely to the estate and property of Landlord in the
Building of which the Premises are a part for the enforcement of any judgment
(or other judicial decree) requiring the payment of money by Landlord to Tenant
by reason of any default or breach by Landlord in the performance of its
obligations under this Lease, it being intended hereby that no other assets of
Landlord or any of Landlord's Affiliates shall be subject to levy, execution,
attachment or any other legal process for the enforcement or satisfaction of the
remedies pursued by Tenant in the event of such default or breach.
In the event of a sale or transfer of the Premises by Landlord, the
Landlord named herein, or, in the case of a subsequent transfer, the transferor,
shall, after the date of such transfer, be automatically released from all
personal liability for the performance or observance of any term, condition,
covenant or obligation required to be performed or observed by Landlord
hereunder; and the transferee shall be deemed to have assumed all of such terms,
conditions, covenants and obligations, it being intended hereby that such terms,
conditions, covenants and obligations shall be binding upon Landlord, its
successors and assigns only during and in respect of their successive periods of
ownership during the Term.
19.4 Non-waiver Of Default. The failure or delay by either party hereto to
enforce or exercise at any time any of the rights or remedies or other
provisions of this Lease shall not be construed to be a waiver thereof, nor
affect the validity of any part of this Lease or the right of either party
thereafter to enforce each and every such right or remedy or other provision. No
waiver of any default or breach of this Lease shall be held to be a waiver of
any other or subsequent default or breach. The receipt by Landlord of less than
the full rent due shall not be construed to be other than a payment on account
of rent then due, no statement on Tenant's check or any letter accompanying
Tenant's check be deemed an accord and satisfaction, and Landlord may accept any
payment without prejudice to Landlord's right to recover the balance of the rent
due or to pursue any other remedies provided in this Lease or available at law
or in equity.
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ARTICLE XX ASSIGNMENT AND SUBLETTING.
Tenant covenants and agrees that neither all nor any part of Tenant's
interest under this Lease shall be assigned, sublet, mortgaged, pledged or
otherwise transferred (whether voluntarily, involuntary or by operation of law,
or otherwise), without the prior written consent of Landlord, which consent
shall not be unreasonably withheld. Tenant agrees that it shall not be
unreasonable for Landlord to withhold its consent for any of the following
reasons which are not exclusive:
(a) The proposed assignee or sublessee is not a reputable party or
reasonable financial worth and/or financial stability in view of the
responsibilities involved;
(b) In the sole judgment of Landlord, the proposed assignee or
sublessee is of a character or engaged in a business which is not in
keeping with the standards of Landlord in the Project;
(c) The proposed assignee or sublessee is a governmental authority (or
a subdivision or agency thereof);
(d) The terms of the proposed assignment or sublease will allow the
assignee or sublessee to exercise a right of renewal or extension, right of
expansion, right of first offer or other similar right held by Tenant; or
(e) The proposed assignee or sublessee or any of its affiliates
occupies space in the Project at the time of the request for consent.
Landlord's consent may be made or withheld subject to such terms and
conditions as Landlord considers necessary in order to protect its interest in
the Premises, the Building and the Project, including but not limited to the
following: that the proposed transferee shall execute, acknowledge and deliver
to Landlord an agreement in form and substance satisfactory to Landlord whereby
such transferee shall assume and agree to perform and to be personally bound by
and upon all the covenants, agreements, terms and conditions of this Lease on
the part of Tenant to be performed and whereby such transferee shall expressly
agree that the provisions of this Article, notwithstanding such assignment and
transfer, shall continue to be binding upon it with respect to future
assignments, subleases, and/or other transfers; in the event Landlord requires
personal guarantees from financially responsible persons as a condition of
consent, that such guarantors shall execute, acknowledge and deliver an absolute
and unconditional guaranty in a form presented by Landlord which shall contain
waivers of all defenses to the maximum extent permitted by law; and that Tenant
shall continue to be liable to Landlord under this Lease for the terms,
covenants, and conditions to be complied with by Tenant whether this Lease is
assigned or sublet.
If at any time Tenant desires to enter into an assignment or subletting,
Tenant shall submit to Landlord in writing (i) the name of the proposed assignee
or sublessee, (ii) such information as to such assignee's or sublessee's
financial responsibility and standing as Landlord may reasonably require, and
(iii) the proposed sublease or instrument of assignment containing all of the
terms and conditions of the proposed assignment or sublease. At any time within
thirty (30) days after Landlord's receipt of Tenant's full submission (including
any additional information Landlord may request), Landlord may by written notice
to Tenant elect either to: (a) consent to the proposed sublease or assignment;
(b) withhold its consent to the proposed sublease or assignment; (c) terminate
this Lease in its entirety in the case of a proposed assignment or with respect
to the proposed sublease premises in the case of a proposed sublease (in which
case the rent, parking rights and any other rights or obligations under this
Lease which are based upon the square footage of the Premises shall be
proportionately adjusted, and Tenant shall pay the cost of any alterations
necessary to divide the proposed
- 26 -
sublease premises from the remainder of the Premises), which termination shall
take effect on the date set forth in Landlord's notice but in no event more than
ninety (90) days after Landlord has so notified Tenant; or (d) take an
assignment or sublease, as applicable, from Tenant in its own name on the same
terms as Tenant shall propose to enter into an assignment or sublease (but
Landlord shall have the unqualified right to re-assign, sublet or sub-sublet
without Tenant's consent and Landlord may offset any sums due or to become due
to Tenant under any assignment or sublease against any sums due to Landlord
under this Lease).
If Tenant shall assign this Lease or sublet any portion of the Premises,
Tenant shall pay to Landlord as additional rent as and when received by Tenant:
(a) In the case of an assignment, an amount equal to 50% of all
consideration paid to Tenant by the assignee for or by reason of the
assignment, whether paid in a lump sum or over time, including but not
limited to any sums paid for personal property or services in excess of the
fair market value thereof and sums paid for tenant improvements or
fixtures;
(b) In the case of a sublease, an amount equal to 50% of the amount by
which the sublease rent and any other consideration paid to Tenant, whether
paid in a lump sum or over time, including but not limited to any sums paid
for personal property or services in excess of the fair market value
thereof and sums paid for tenant improvements or fixtures, exceeds the
rents payable which are proportionately allocable to the subleased premises
based on the ratio of the area of the subleased premises to the area of the
entire Premises.
Tenant shall be deemed to have assigned its interest hereunder within the
meaning of this Article if legal or beneficial interests representing 20% or
more of the interests in either voting power, capital, or profits in any
corporation, partnership, joint venture, or other entity comprising Tenant are
transferred by any means.
If this Lease is assigned, or if the Premises or any part thereof are
sublet or occupied by anyone other than Tenant, without first obtaining
Landlord's consent and complying with all conditions to such consent, then
Tenant shall be in default under this Lease and Landlord may collect rent from
the assignee, subtenant or occupant, and apply the net amount collected to the
rent herein reserved but no such assignment, subletting, occupancy or collection
shall be deemed a waiver by Landlord of any default by Tenant or of the
obligation of Tenant to perform all covenants and comply with all conditions
contained in this Lease or a release of Tenant from the performance by Tenant of
the covenants on the part of Tenant contained in this Lease.
Tenant shall reimburse Landlord for any reasonable costs and expenses,
including but not limited to legal expenses, incurred by Landlord in connection
with its review of any proposed assignment or subletting, whether or not
Landlord gives its consent.
Landlord shall have the right to sell, transfer, or assign its interest
hereunder, or any part thereof, without the prior consent of Tenant. After such
sale, transfer, or assignment, Tenant shall attorn to such purchaser,
transferee, or assignee.
ARTICLE XXI SUBORDINATION AND ESTOPPEL.
At the election of Landlord, or the holder of any mortgage or deed of trust
affecting real property of which the Premises are a part, this Lease and all of
the rights of Tenant hereunder shall be subject and subordinate at all times to
all deeds of trust or mortgages which may now or hereafter affect the real
property of which the Premises are a part, and to all renewals, modifications,
consolidations, replacements and extensions thereof. At the request of Landlord
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or the holder of such mortgage or deed of trust, Tenant shall execute,
acknowledge and deliver promptly in recordable form any instrument or
subordination agreement that Landlord or such holder may request; provided,
however, that such instrument shall include a provision requiring the purchaser
at any foreclosure sale or other execution sale to continue this Lease in full
force and effect in the same manner as if such purchaser were the Landlord so
long as Tenant is not otherwise in default and requiring Tenant to attorn to
such purchaser. If Tenant fails to execute such instrument within ten (10) days
after a request to do so, such failure shall be a material default under this
Lease.
Within ten (10) days after request therefor by Landlord, Tenant agrees to
execute and deliver in recordable form an estoppel certificate to any holder of
a mortgage or proposed mortgage or proposed purchaser or to Landlord certifying
(if such is the case) that this Lease is unmodified and in full force and effect
(and if there has been any modification, that the same is in full force and
effect as modified and stating the modifications); that there are no uncured
defaults by Landlord; that there are no defenses or offsets against the
enforcement thereof or stating those claimed by Tenant; stating the date to
which rent and other sums due hereunder are paid; and containing such other
statements regarding this Lease, the Premises or Tenant as Landlord, the
proposed mortgagee or purchaser shall reasonably require. Such certificate shall
also include such other information and agreements by Tenant to protect the
security interest of any lender as may be required or requested by such lender.
The failure by Tenant to deliver any such certificate within ten (10) days after
request therefor shall be deemed to constitute the certification by Tenant that
this Lease is in full force and effect and has not been modified except as may
be represented by Landlord, that no rent or other payment has been paid more
than one month in advance, and that there are no uncured defaults by Landlord
and there are no defenses or offsets against the enforcement thereof. If Tenant
fails to deliver such estoppel certificate within said ten (10) days, Tenant
shall and does hereby irrevocably appoint Landlord as Tenant's attorney in fact
to execute and deliver such certificate. Failure of Tenant to provide such
statement, whether Landlord acts as agent to provide a statement or not, shall
be a material default under this Lease, and Tenant shall indemnify Landlord for
all liabilities, costs, expenses and losses (including forfeited deposits, lost
opportunity to pay lower interest or to obtain additional investment funds and
other consequential damages.)
ARTICLE XXII BUILDING PLANNING.
If Landlord requires the Premises for use in conjunction with another suite
or for other reasons connected with the Landlord's Building planning program,
upon notifying Tenant in writing, Landlord shall have the right to move Tenant
to other space in the Building, which is or shall be built out by Landlord in a
manner comparable to the Premises, and the terms and conditions of the original
Lease shall remain in full force and effect, save and excepting that a revised
Exhibit "A" shall become part of this Lease and shall reflect the location of
the new space. Landlord shall pay the reasonable costs of moving Tenant's
furniture, equipment and personal property to the new space and shall reimburse
Tenant for reasonable incidental costs of moving such as reprinting stationery
with Tenant's new location.
ARTICLE XXIII NOTICES.
Any and all notices, approvals or demands required or permitted under this
Lease shall be in writing and shall be served either personally or by United
States Certified Mail, postage prepaid, return receipt requested. If served
personally service shall be deemed conclusively to occur at the time of service.
If served by Certified Mail, service shall be deemed conclusively to occur on
the second business day after the postmark, postage meter date, or the date
stamped by the United States Postal Service on a certified mail receipt provided
such item of mail reflects the correct postage and the latest known address of
the party to whom such notice or demand is to be given. Such item of mail shall
be
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presumed to have the correct postage the latest known address of the addressee
and to have been mailed on the date asserted by the party giving notice. The
burden of proving improper postage and/or address and/or date shall be on the
party seeking to prove improper notice. Any notice or demand to each respective
party shall be sent to their addresses as set forth in the Basic Lease
Provisions, or to such other address of which such party shall advise the other
in writing in the manner provided in this Article; provided, however, that any
notice or demand made upon Tenant may be made and shall be complete if delivered
to the Premises. All notices to Landlord shall be deemed incomplete and not made
unless delivered to each of the addresses set forth in the Basic Lease
Provisions and/or such other address or addresses as Landlord shall advise
Tenant by delivery of written notice to Tenant in accordance with this Section.
ARTICLE XXIV BROKERS.
Tenant warrants that it has had no dealings with any real estate broker or
agent in connection with the negotiation of this Lease, except the broker listed
in the Basic Lease Provisions whose commission shall be payable by Landlord, and
that it knows of no other real estate broker or agent who is or might be
entitled to a commission in connection with this Lease. If Tenant has dealt with
any other person or real estate broker with respect to leasing or renting space
in the Building, Tenant shall be solely responsible for the payment of any fee
due such person or broker and Tenant shall hold Landlord free and harmless,
against any liability in respect thereto, including attorneys fees and costs
ARTICLE XXV HOLDING OVER.
If Tenant holds over after the expiration or earlier termination of the
term of this Lease without the express written consent of Landlord, Tenant shall
become a Tenant at sufferance only, at a rental rate equal to two hundred
percent of the rent in effect upon the date of such expiration (subject to
adjustment as provided in Section 4.2 hereof and prorated on a daily basis), and
otherwise subject to the terms, covenants and conditions specified in this
Lease, so far as applicable. Acceptance by Landlord of rent after such
expiration or earlier termination shall not result in a renewal of this Lease or
waiver of any default or circumstances of termination. The foregoing provisions
of this Article are in addition to and do not affect Landlord's right of
re-entry or any rights of Landlord otherwise provided in this Lease or as
otherwise provided by law. If Tenant fails to surrender the Premises upon the
expiration of this Lease despite demand to do so by Landlord, Tenant shall
indemnify and hold Landlord harmless from all loss, cost, expense or liability,
including without limitation, any claim made by any succeeding tenant founded on
or resulting from such failure to surrender and any attorneys fees and other
costs of legal proceedings.
ARTICLE XXVI MISCELLANEOUS.
26.1 Rules And Regulations. Tenant shall faithfully observe and comply with
the "Rules and Regulations," a copy of which is attached hereto and marked
Exhibit D, and all reasonable and nondiscriminatory modifications thereof and
additions thereto from time to time put into effect by Landlord. Landlord shall
not be responsible to Tenant for the violation or non-performance by any other
tenant or occupant of the Building of any of the Rules and Regulations.
26.2 Interpretation. This Lease shall be construed fairly as to all parties
and not in favor of or against any party regardless of which party prepared this
Lease. This Lease and the rights of the parties hereunder shall be interpreted
in accordance with the laws of the State of California and any issue or
proceeding arising out of this Lease shall be determined by a court of competent
jurisdiction in the County of Los Angeles, California.
26.3 Successors and Assigns. This Lease and the respective rights and
obligations of the parties hereto shall inure to the benefit of and be binding
upon the successors and assigns of the parties hereto as well as the parties
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themselves; provided, however, that Landlord, its successors and assigns shall
be obligated to perform Landlord's covenants under this Lease only during and in
respect of their successive periods of ownership during the term of this Lease.
26.4 Surrender of Premises. The voluntary or other surrender of this Lease
by Tenant, or a mutual cancellation thereof, shall not work a merger, and shall,
at the option of Landlord, operate as an assignment to it of any or all
subleases or subtenancies.
26.5 Attorneys' Fees.
(a) If Landlord should bring suit for possession of the Premises, for
the recovery of any sum due under this Lease, or because of the breach of
any provisions of this Lease, or for any other relief against Tenant
hereunder, or in the event of any other litigation between the parties with
respect to this Lease, then all costs and expenses, including reasonable
attorneys fees, incurred by the prevailing party therein shall be paid by
the other party, which obligation on the part of the other party shall be
deemed to have accrued on the date of the commencement of such action and
shall be enforceable whether or not the action is prosecuted to judgment.
The "prevailing party" in any action involving recovery of possession of
the Premises shall be the Landlord if it recovers the right to possession,
shall be the Landlord if it does not recover the right to possession but
does obtain an award of damages against Tenant and shall be Tenant if
Tenant retains the right to possession and does not suffer an award of
damage against itself.
(b) If Landlord is named as a defendant in any suit brought against
Tenant in connection with or arising out of Tenant's occupancy hereunder,
Tenant shall pay to Landlord its costs and, expenses incurred in such suit,
including reasonable attorneys' fees.
26.6 Performance By Tenant. All covenants and agreements to be performed by
Tenant under any of the terms of this Lease shall be performed by Tenant at
Tenant's sole cost and expense and without any abatement of rent. If Tenant
shall fail to pay any sum of money owed to any party other than Landlord, for
which it is liable hereunder, or if Tenant shall fail to perform any other act
on its part to be performed hereunder, and such failure shall continue for ten
(10) days after notice thereof by Landlord, Landlord may, without the obligation
to do so and/or waiving or releasing Tenant from its obligations, make any such
payment or perform any such other act to be made or performed by Tenant. All
sums so paid by Landlord and all necessary incidental costs together with
interest thereon at the maximum contract rate permissible by law, from the date
of such payment by Landlord, shall be payable by Tenant to Landlord on demand.
Tenant covenants to pay any such sums, and Landlord shall have (in addition to
any other right or remedy of Landlord) all rights and remedies in the event of
the nonpayment thereof by Tenant as are set forth in Article 19 hereof.
26.7 Mortgagee Protection. In the event of any default on the part of
Landlord, Tenant shall notify, by registered or on certified mail, any
beneficiary of a deed of trust or mortgage covering the Premises whose address
shall have been furnished to Tenant, and shall offer such beneficiary or
mortgagee a reasonable opportunity to cure the default, including time to obtain
possession of the Premises by power of sale or a judicial foreclosure, if such
should prove necessary to effect a cure.
26.8 Waiver. The waiver by Landlord of any breach of any term, covenant or
condition herein contained shall not be deemed to be a waiver of any subsequent
breach of the same or any other term, covenant or condition herein contained,
nor shall any custom or practice which may grow up between the parties in the
administration of the terms hereof be deemed a waiver of or in any way affect
the right of Landlord to insist upon the performance by Tenant in strict
accordance with said terms. The subsequent acceptance of rent hereunder by
Landlord shall not be deemed to be a waiver of any preceding breach by Tenant of
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any term, covenant or condition of this Lease, other than the failure of Tenant
to pay the particular rent so accepted, regardless of Landlord's knowledge of
such preceding breach at the time of acceptance of such rent.
26.9 Identification of Tenant. If more than one person executes this Lease
as Tenant:
(a) Each of them is jointly and severally liable for the keeping,
observing and performing of all of the terms, covenants, conditions,
provisions and agreements of this Lease to be kept, observed and performed
by Tenant, and
(b) The term "Tenant" as used in this Lease shall mean and include
each of them jointly and severally. The act of or notice from, or notice or
refund to, or the signature of any one or more of them, with respect to the
tenancy of this Lease, including, but not limited to any renewal,
extension, expiration, termination or modification of this Lease, shall be
binding upon each and all of the persons executing this Lease as Tenant and
binding upon any guarantor with the same force and effect as if each and
all of them had so acted or so given or received such notice or refund or
so signed or consented.
26.10 Parking. Tenant shall have the right to lease on a monthly basis
permits for parking on an unreserved basis in the Project's parking facilities
the number of automobiles set forth in the Basic Lease Provisions. All such
permits shall be available at the same rates as established from time to time by
Landlord or Landlord's parking operator for other spaces in the same location
within the designated parking structure or lot. The use by Tenant, its employees
and invitees of the parking facilities of the Project shall be subject to such
rules and regulations as from time to time are established by Landlord or
Landlord's parking operator. The number of parking permits shall be subject to
reasonable adjustment by Landlord if such adjustment is required by any
governmental authority in connection with any traffic or pollution or other
control program of such governmental authority.
26.11 Captions, Number, Gender, and Joint and Several Liability. The
article, title or section headings of the various provisions of this Lease are
intended solely for convenience of reference and shall not in any manner
amplify, limit or modify or otherwise be used in the interpretation of any of
such provisions. As used in this Lease, the masculine, feminine, or neuter
gender and the singular or plural number shall be deemed to include the other
whether the context so indicates or requires. If Tenant consists of more than
one person or entity, they and each of them shall be bound jointly and severally
by the terms, covenants and conditions of this Lease. This Lease shall be
construed without regard to any presumption or other rule requiring construction
against the party drafting a document.
26.12 Lease Examination. Submission of this instrument for examination or
signature by Tenant does not constitute an offer or option to lease, and it
shall not be effective as a lease or otherwise until execution and delivery by
both Landlord and Tenant.
26.13 Time is of the Essence. Time is of the essence of this Lease in 11
circumstances where time is an element.
26.14 Entire Agreement. This Lease, together with its exhibits and
attachments referenced herein, which are incorporated herein by such reference
and shall constitute a part of this Lease, constitutes the entire agreement
between the parties hereto pertaining to the subject matter hereof, and the
final, complete and exclusive expression of the terms and conditions of this
Lease, all prior agreements, promises, representations, negotiations, and
understandings of the parties hereto, oral or written, express or implied, are
hereby superseded and merged herein, except for representations of financial
condition of Tenant delivered to Landlord upon which Landlord has relied in
connection with leasing of the Premises or consent to any matter.
- 31 -
26.15 Severability. If any provision of this Lease, as applied to any party
or to any circumstance, shall be adjudged by a court of competent jurisdiction
to be void or unenforceable for any reason, the same shall not affect (to the
maximum extent permissible by law) any other provision of this Lease, the
application of such provision under circumstances different from those adjudged
by the court, or the validity or enforceability of this Lease as whole.
26.16 Recording. Neither Landlord nor Tenant shall attempt to record this
Lease or any memorandum or short form of this Lease.
26.17 Modifications For Lender. If, in connection with obtaining
construction, interim or permanent financing for the Building or the Project any
lender or proposed lender shall request reasonable modifications in this Lease
as a condition to such financing, then Tenant shall not unreasonably withhold,
delay or defer its consent thereto, provided that such modifications do not
increase the obligations of Tenant hereunder or materially, adversely affect the
leasehold interest hereby created or Tenant's rights hereunder.
26.18 Payments to Affiliates. Nothing in this Lease shall be construed to
prevent Landlord from paying for services rendered or materials delivered with
respect to the Building, the Project or to the Premises (including, without
limitation, management services and contracting out capital improvements or
other capital repairs or construction items) by affiliates of Landlord or its
beneficiary, provided that the fees or costs of such services and materials are
at market rates in the metropolitan area of which the Project is a part. All
such fees or costs paid by Landlord to such affiliates shall be deemed to
constitute expenses of maintenance and repair on the same terms and conditions
as if such fees and costs were paid to nonaffiliates of Landlord or its
beneficiaries.
26.19 Landlord's Inability to Perform. Landlord shall not be in default
hereunder if Landlord is unable to fulfill any of its obligations under this
Lease, provided Landlord is prevented or delayed from so doing by any accident,
breakage, repair, alteration, improvement, strike or labor troubles, moratorium,
war, civil unrest, act of God, or any outside cause whatsoever beyond the
reasonable control of Landlord, including, but not limited to, energy shortages
or governmental preemption in connection with a national emergency, or by reason
of law or any rule, order or regulation of any department or subdivision thereof
of any governmental agency, or by reason of the conditions of supply and demand
which have been or are affected by war, hostilities, or other emergency. The
performance by Landlord of its covenants contained in this Lease shall be
independent of Tenant's covenants to pay rent and perform Tenant's obligations
under this Lease. The failure of Landlord to perform its covenants under this
Lease shall not relieve Tenant of its covenants to pay rent and perform under
this Lease or entitle Tenant to any offset or abatement of rent, and Tenant
waives the benefit of any statute or rule of law now or hereafter in effect to
the contrary.
26.20 Interest. Any sum due from Tenant to Landlord not paid when due shall
bear interest from the date due until the date paid at the annual rate of two
(2) percentage points per annum above the rate of interest then most recently
announced by Citibank, N.A., New York, New York, or its successor, as its prime
rate of interest, as such rate may change from time to time during this Lease;
provided, however, that such rate shall not exceed the maximum contract rate
permitted by law. The payment of such amount shall not excuse or cure any
default of Tenant under this Lease except as to the nonpayment of such amount.
26.21 The Common Areas. The term "Common Areas" refers to the areas of the
Building and the realty in the Project which are designed for use in common by
all tenants of the Building and the Project and their respective employees,
agents, customers, invitees and others, and includes, by way of illustration and
not limitation, entrances and exits, hallways, stairwells, elevators, restrooms,
sidewalks, driveways, parking areas (subject to the right of Landlord or its
parking operator to control access thereto, charge for its use), landscaped
areas
- 32 -
and other areas as may be designated as part of the Common Areas. The Premises
shall include the nonexclusive right to use the Common Areas in common with and
subject to the rights of other tenants in the Building and the Project and the
rules and regulations established by Landlord.
26.22 Authorized Signatory. If Tenant signs as a corporation, each person
executing this Lease on behalf of Tenant does hereby covenant and warrant that
Tenant is a duly authorized and existing corporation, that Tenant has and is
qualified to do business in California, that the corporation has full right and
authority to enter into this Lease, that each person executing this Lease on
behalf of the corporation is authorized to do so, and that such execution is
fully binding on the corporation. If Tenant signs as a partnership, joint
venture, or sole proprietorship (each being herein called "Entity") each person
executing on behalf of Tenant does hereby covenant and warrant that Tenant is a
duly authorized and existing Entity, that Tenant has full right and authority to
enter into this Lease, that each person executing this Lease on behalf of the
Entity is authorized to do so, and that such execution is fully binding on the
Entity and its partners, joint venturers, or principal, as the case may be.
26.23 Covenants and Conditions. Each provision of this Lease required to be
performed by Tenant shall be deemed both a covenant and a condition.
26.24 Reservations of Landlord. Landlord shall have the right to change the
name, number or designation of the Building or the Project without notice or
liability to Tenant. In addition, Tenant shall not, without Landlord's prior
written consent, use the name of the Building or the Project for any purpose
other than as the address of the business to be conducted by Tenant and the
Premises, and in no event shall Tenant acquire any rights in or to such names.
Landlord shall have the right at any time to change the arrangement and/or
location of entrances or passageways, doors and doorways, corridors, elevators,
stairs, toilets or other parts of the Common Area in the Building or the
Project, and Landlord reserves the right at any time to make alterations or
additions to the Building and to build adjoining the same. Landlord reserves the
right to construct other buildings or improvements in the vicinity of the
Building from time to time, to make alterations thereof or additions thereto,
and to build additional stories on any such buildings and to build adjoining the
same. Landlord further reserves the exclusive right to the roof of the Building.
No easement for light, air or view is included in the leasing of the Premises to
Tenant. Accordingly, any diminution or shutting off of light, air or view by any
structure which may be erected in the vicinity of the Building shall in no way
affect this Lease or impose any liability upon Landlord.
26.25 Quiet Enjoyment. Subject to payment of all rents and other sums
required of Tenant under this Lease and observance and performance of all of the
covenants, terms and conditions required to be performed on the Tenant's part
and subject to the rights of any mortgagee or ground lessor having priority over
this Lease, Tenant shall peaceably hold the Premises for the Term hereby demised
without hindrance or interruption by Landlord or any other person or persons
lawfully or equitably claiming by, through or under the Landlord, subject,
nevertheless, to the terms and conditions of this Lease.
26.26 Amendment. No amendment or addition, modification of or alteration of
any provision contained in this Lease shall be effective unless fully set forth
in writing and executed by Landlord and Tenant.
26.27 Cumulative Rights. All rights, elections and remedies of Landlord
contained in this Lease shall be construed and held to be cumulative, and no one
of them shall be exclusive of the other and Landlord shall have the right to
pursue any one or all of such remedies or any other remedy or relief which may
be provided by law or equity, whether or not stated in this Lease.
26.28 Financial Statements. Tenant represents and warrants that all
financial statements and financial information provided to Landlord prior to
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execution of this Lease or in connection with obtaining any consent are true and
correct and accurately reflect the financial condition of the person or entity
covered by such statements as of the date of such statements and that no
material adverse change has occurred since such date. Tenant further agrees to
provide additional financial statements certified to be true and correct and
accurately presenting Tenant's financial condition as of Tenant's last annual
and quarterly accounting periods as from time to time requested by Landlord
within fifteen (15) days after such request.
26.29 Waiver of Right to Trial by Jury. Tenant waives the right to trial by
jury.
26.30 Exculpation. Tenant acknowledges that this Lease is being executed by
Xxxxxxxx Xxxx Northwestern California, Inc. on behalf of Landlord, not
personally, but solely as managing agent for Landlord, and nothing in this Lease
or any other instrument, document or agreement shall create any personal
liability on the part of Xxxxxxxx Xxxx Northwestern California, Inc., its
shareholders, officers, directors, partners or employees, nor shall any such
liability be asserted or claimed.
IN WITNESS WHEREOF, the parties have executed this Lease as of the date
first above written.
LANDLORD: TENANT:
KGK ENTERPRISES, INC., SEAGULL ENTERTAINMENT, INC.
a California corporation a Delaware corporation
By: Xxxxxxxx Xxxx NW, Inc., By: /s/ Xxxx Xxxxxx
its Managing Agent ---------------------------
By: /s/ Xxxxxx X. Xxxxxxx Its: President
------------------------------- ---------------------------
Its: XXXXXXXX XXXX NW. INC. By: /s/ Xxxxx Xxxxxx
------------------------------- ---------------------------
Executive Vice-President
Its: Chairman
---------------------------
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GUARANTY OF LEASE
THIS GUARANTY OF LEASE (this "Guaranty") is made by Xxxx Xxxxxx and Xxxxx
Xxxxxx, ("Guarantor"), to KGK Enterprises. Inc., a California corporation,
("Landlord"), with respect to the Standard Industrial Lease Agreement (the
"Lease") dated May 31, 1995, between Landlord and Seagull Entertainment. Inc., a
California corporation, ("Tenant"), with respect to certain premises (the
"Premises") located in Cornerstone Plaza, 0000 Xxxxx Xxxxx Xxxxx, Xxx Xxxxxxx,
Xxxxxxxxxx 00000.
As a material inducement to and in consideration of Landlord's entering
into the Lease, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Guarantor hereby covenants and
agrees with Landlord as follows:
1. Guarantor absolutely, unconditionally and fully guarantees the following
(the "Obligations"): (a) the payment of all rent, monies and charges payable by
Tenant under the Lease at the times the same are required to be paid thereunder;
(b) the performance when due of each and all of the covenants and provisions
contained in the Lease to be kept, performed or observed by Tenant; and (c) the
payment of all damages owing to Landlord by Tenant after termination of the
Lease following a default thereof by Tenant or otherwise.
2. The liability of Guarantor hereunder shall not be affected, impaired,
limited or reduced in any way by any action taken by Landlord under any
provision hereof, or by any delay, failure or refusal of Landlord to exercise
any right or remedy Landlord may have against Tenant or against any other
guarantor. Guarantor agrees that if any of the Obligations is not paid or
performed as required under the Lease, Guarantor, after receipt of written
demand therefor by Landlord, shall pay such Obligation when required of Tenant
under the Lease as if such Obligations constituted the direct and primary
obligations of Guarantor. Guarantor shall indemnify, defend, protect and hold
Landlord harmless from any losses, liabilities, costs, expenses, causes of
action and damages arising out of (a) any failure by Tenant to pay or perform
any Obligations, or (b) the recapture of any rent, monies or charges received
during a preference period provided by any state or federal bankruptcy law.
3. Satisfaction by Guarantor of any liability hereunder incident to a
particular default shall not discharge Guarantor except for the default
satisfied. This Guaranty and the obligations of Guarantor hereunder shall be
continuing and irrevocable until (a) Landlord has received full payment of all
rents, monies and charges, and full performance of all of the Obligations due
under the Lease or to become due during the term of the Lease, including any
optional extensions thereof, and (b) any applicable preference period under
state or federal bankruptcy law has expired, and (c) Landlord has released
Guarantor from the Obligations, which may be accomplished only by an instrument
in writing signed by Landlord.
4. Guarantor hereby waives all presentments, demands (including demands for
performance), protests, notices of protest, notices of dishonor and notices of
acceptance of this Guaranty by Landlord, and this Guaranty shall be binding upon
Guarantor immediately upon its delivery to Landlord.
5. Guarantor hereby waives and agrees not to assert or take advantage of
(a) any right to require Landlord to proceed against Tenant or a co-guarantor or
to proceed against or exhaust any security held by Landlord at any time; (b) any
defense of the statute of limitations in any action hereunder or in any action
for the performance of any Obligation; (c) any defense that my arise by reason
of the incapacity, lack of authority, death or disability of any other person or
persons or the failure of Landlord to file or enforce a claim against the estate
(in administration, bankruptcy or any other proceeding) of any other person or
persons; (d) any demands for performance or notice of nonperformance on the part
of Tenant of the terms of the Lease; (e) any defense based on the fact that the
liability of the Guarantor hereunder may be greater than the liability of the
Tenant by reason of (i) amendments to the Lease, (ii) the Landlord's agreement
to forebear
from enforcing its rights under the Lease or at law or in equity, or (iii) any
other set of facts, acts or omissions; (f) any defense based upon an election of
remedies by Landlord, including any election which destroys or impairs any right
of subrogation, reimbursement or contribution which Guarantor may have, or any
rights or benefits under any provision of applicable law in any way qualifying,
conditioning or limiting the obligations of Guarantor based on any steps or
procedures that Landlord allegedly should take before proceeding against
Guarantor; (g) any duty on the part of Landlord to disclose to Guarantor any
facts Landlord may now or hereafter know about Tenant, regardless of whether
Landlord (i) has reason to believe that any such facts materially increase the
risk beyond that which Guarantor intends to assume, or (ii) has reason to
believe that such facts are unknown to Guarantor, or (iii) has a reasonable
opportunity to communicate such facts to Guarantor, it being understood and
agreed that Guarantor is fully responsible for becoming the remaining informed
of the financial condition of Tenant and of any and all circumstances bearing on
the risk of nonperformance of any Obligation; (h) any rights or benefits in
favor of Guarantor under Sections 2809, (which provides that the obligation of a
surety must be neither larger in amount nor in order respects more burdensome
than that of the principal), 2810 (which defines a surety's liability in the
event of disability of the principal), 2815 (which provides that a continuing
guaranty may be revoked by the guarantor unless there is continuing
consideration), 2819 (which provides for exoneration of the surety if the
original obligation of the principal is altered in any respect, or the remedies
or rights of the creditor against the principal are impaired or suspended
without the consent of the surety), 2839 (which provides that a surety is
exonerated by the performance or the offer of performance of the principal
obligation), 2845 (which provides that a surety may require the creditor to
proceed against the principal), 2849 (which provides that a surety is entitled
to the benefit of security for the performance of the principal obligation held
by the creditor), 2850 (which provides that the surety is entitled to have the
property of the principal first applied to the discharge of the obligation),
2899 (which provides for the order of resort to different funds held by the
creditor), or 3433 (which provides for the relative rights of different
creditors) of the California Civil Code or under 11 U.S.C. Sections 364 or
1111(b), or any amendment to any of the foregoing statutes; (i) any transfer of
Landlord's interest in the Premises; 6) any transfer of Tenant's interest as
tenant under the Lease or any portion thereof or any sublease or assignment by
Tenant; (k) any merger or consolidation of Tenant or sale of all or a
substantial portion of Tenant's assets; (l) any sale of all or any portion of
any capital stock of Tenant or partnership interest in Tenant owned by
Guarantor; (m) any prior or concurrent representation, understanding, promise
or condition concerning the subject matter hereof which is not expressed herein,
which are hereby declared to be of no force or effect; or (n) any right or
defense arising by reason of the absence, impairment, modification, limitation,
destruction or cessation of any rights or remedies (in bankruptcy, by an
election of remedies or otherwise).
GUARANTOR HEREBY ACKNOWLEDGES AND AGREES THAT THE WAIVERS CONTAINED IN THIS
GUARANTY HAVE BEEN KNOWINGLY AND VOLUNTARILY MADE AND THE LEGAL CONSEQUENCES OF
SUCH WAIVERS AND THE CONTENT OF THIS GUARANTY HAVE BEEN EXPLAINED TO GUARANTOR
BY ITS INDEPENDENT LEGAL COUNSEL AND GUARANTOR UNDERSTANDS THE LEGAL
CONSEQUENCES OF THE FOREGOING WAIVERS AND THE CONTENT AND NATURE OF THIS
GUARANTY.
/s/ Xxxx Xxxxxx
---------------------------
GUARANTOR (Xxxx Xxxxxx)
/s/ Xxxxx Xxxxxx
---------------------------
GUARANTOR (Xxxxx Xxxxxx)
6. Without limiting the generality of the foregoing, Guarantor's liability
under this Guaranty shall not be deemed to have been waived, released,
discharged, limited, impaired or affected by reason of (a) the expiration or
termination of the term of the Lease; (b) the release or discharge of Tenant in
any receivership, bankruptcy, winding-up or other creditors' proceedings or the
rejection, disaffirmance or disclaimer of the Lease by any party in any such
proceeding; (c) the repossession of the Premises, provided,
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however, that the net payments received by Landlord after deducting all costs
and expenses of repossession and/or reletting the same shall be credited from
time to time by Landlord to the account of Guarantor; or (d) any amendment of
the terms of the Lease without Guarantor's consent.
7. Guarantor shall not, without the prior written consent of Landlord,
commence or join with any other person in commencing any bankruptcy,
reorganization or insolvency proceedings against Tenant.
8. Guarantor shall file in any bankruptcy or other proceeding in which the
filing of claims is required or permitted by law all claims which Guarantor may
have against Tenant relating to any indebtedness of Tenant to Guarantor and will
assign to Landlord all rights of Guarantor thereunder. Landlord shall have the
sole right to accept or reject any plan proposed in such proceedings and to take
any other action which a party filing a claim is entitled to do. In all such
cases, whether in administration, bankruptcy, or otherwise, the person or
persons authorized to pay such claim shall pay to Landlord the amount payable on
such claim and, to the full extent necessary for that purpose, Guarantor hereby
assigns to Landlord all of Guarantor's right to any such payments or
distributions to which Guarantor would otherwise be entitled; provided, however,
that Guarantor's obligations hereunder shall not be satisfied except to the
extent that Landlord receives cash by reason of any such payments or
distribution. If Landlord receives anything hereunder other than cash, the same
shall be held as collateral for amounts due under this Guaranty.
9. The amount of Guarantor's liability and all rights, powers and remedies
of Landlord hereunder shall be cumulative and not alternative and such rights,
powers and remedies shall be in addition to all rights, powers and remedies
available to Landlord at law or in equity.
10. In the event of any default hereunder, a separate action or actions may
be brought and prosecuted against Guarantor, whether or not Tenant is joined
herein or a separate action or actions are brought against Tenant. Landlord may
maintain successive actions for other defaults.
11. Guarantor shall pay Landlord, upon demand, reasonable attorney's fees
and all costs and other expenses which Landlord expends or incurs in enforcing
this Guaranty, obtaining any judgement under this Guaranty against Guarantor, or
in connection with any insolvency, bankruptcy, reorganization, arrangement or
other similar proceedings involving Tenant, Guarantor, or either of them, which
in any way affect the exercise by Landlord of its rights and remedies hereunder.
12. Should any provision of this Guaranty be determined to be illegal or
unenforceable, all other provisions hereof shall nevertheless be deemed
effective.
13. No provision of this Guaranty or right of Landlord hereunder may be
waived, nor shall Guarantor be released from performance of Guarantor's
obligations hereunder, except by a writing duly executed by Landlord, which may
be withheld in its sole and absolute discretion.
14. This Guaranty shall inure to the benefit of and bind the heirs, legal
representatives, administrators, executors, successors and assigns of Guarantor
and of Landlord. If more than one person or entity executes this Guaranty, the
obligations of each hereunder shall be joint and several.
15. The acceptance by Landlord of the performance of any of the Obligations
under the Lease by Guarantor, including, without limitation, the acceptance of
rent payments, shall constitute neither an assignment of the Lease to Guarantor
nor Landlord's consent to such an assignment.
16. Guarantor, from time to time within ten (10) days following Landlord's
request, shall execute and deliver to Landlord (i) an estoppel certificate
containing such truthful information as Landlord
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may reasonably request, and (ii) such further instruments or documentation as
may reasonably be requested by Landlord to ratify and confirm this Guaranty and
the continuing liability of Guarantor hereunder.
17. This Guaranty shall be governed by and construed in accordance with the
laws of the State of California. The parties hereby consent to jurisdiction and
venue in any California court of competent jurisdiction or the United States
District Court for the county and federal judicial district, respectively, in
which the Premises are located, and agree that such courts shall constitute the
exclusive venue for any dispute arising hereunder.
IN WITNESS WHEREOF, Guarantor has executed this Guaranty as of the date
written below.
DATED: June 1, 1995. GUARANTOR:
Xxxx Xxxxxx
Xxxxx Xxxxxx
BY: /s/ Xxxx Xxxxxx
---------------------------------------
Xxxx Xxxxxx
SOCIAL SECURITY #: ###-##-####
DRIVER'S LICENSE #: X000000
HOME ADDRESS: 000 Xxxxxxx Xx.
Xxxxxxx Xxxxxxxxx, XX 00000
HOME PHONE: (000) 000-0000
By: /s/ Xxxxx Xxxxxx
---------------------------------------
Xxxxx Xxxxxx
SOCIAL SECURITY #: ###-##-####
DRIVER'S LICENSE #: 000-000-000
HOME ADDRESS: 00 Xxxxxxxxxxxx Xx
Xxxxxxxx XX 00000
HOME PHONE: (000) 000-0000
4 of 4
FIRST AMENDMENT TO OFFICE LEASE AND GUARANTY OF LEASE
THIS FIRST AMENDMENT TO OFFICE LEASE AND GUARANTY OF LEASE ("First
Amendment") is made and entered into as of June 13, 1996, by and between KGK
Enterprises, Inc., a California Corporation ("Landlord"), and Seagull
Entertainment, Inc. ("Tenant") who agrees as follows:
RECITALS
This First Amendment is made with reference to the following facts and
objectives:
A. Landlord and Tenant entered into that certain Office Lease dated as of
May 31, 1995, (referred to as the "Lease"), covering the premises located in the
City and County of Los Angeles, State of California, commonly known as Suite 725
on the seventh floor of the Cornerstone Plaza office building (the "Building")
located at 0000 Xxxxx Xxxxx Xxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000 (collectively,
the "Premises").
B. Xxxx Xxxxxx and Xxxxx Xxxxxx (Collectively the "Guarantor") and Landlord
entered into that certain Guaranty of Lease dated as of May 31, 1995
("Guaranty") with the respect to the Lease.
C. Landlord and Tenant wish to amend the Lease and Guaranty as provided in
this First Amendment.
NOW THEREFORE, the parties hereto agree to follows:
1. Effective Date. The "Effective Date" of this First Amendment shall be
that date in which the Tenant Improvements (as defined below) for the Expansion
Premises (as defined below) are substantially complete.
2. Premises. Effective as of the Effective Date, the Premises shall be
increased by adding 3,058 rentable square feet ("Expansion Premises") to the
existing 2,804 rentable square feet ("Existing Premises") and shall thereafter
be 5,862 ("Expanded Premises") rentable square feet. The Premises shall
thereafter consist of that portion of the seventh floor that is depicted and
identified as the Expanded Premises on Exhibit A-1 to this First Amendment.
3. Proportionate Share. Effective as of the Effective Date, Tenant's
Building Expense Percentage as depicted in Item f. of the Basic Lease Provisions
shall be increased from 1.719% to 3.57%.
First Amendment to Office Lease and Guaranty of Lease
Seagull Entertainment, Inc.
Page Two
4. Basic Annual Rent. Effective as of the Effective Date the Basic Annual
Rent (and Monthly Rental) for the Premises shall be as follows:
Annual Basic Rent: $123,102.00 ($21.00/sf/mo.)
Monthly Basic Rent: $ 10,258.50 ($1.75/sf/mo.)
5. Term. Effective as of the Effective Date, the Term of the Lease shall be
extended by two (2) years so that the new Lease expiration date shall,
thereafter be June 18, 2002 instead of June 18, 2000.
6. Tenant Improvements: Landlord, at its sole cost and expense shall modify
the Premises pursuant to a mutually acceptable space plan (a copy of which is
attached hereto as Exhibit A-2) using building standard materials. The following
work shall be provided by Landlord:
1 Remove existing pass thru sliding window. Replace wood transaction top
to match existing (room 701).
2 New embossed (approx. 5'0" X 7'0") glass window in totally recessed
stainless steel channels top and bottom, side edges of glass insert
into drywall (partition detail to follow). Glass: "Ultrastorm" DTO1
tempered 3/8" Starfire by Ultraglass (room #701).
3 New (approx. 2'0" X 7'0") single light solid wood paint grade door.
Min. sized styles, door size to fit existing frame. New building
standard latch set to match, re-install existing closer, paint door
semi-gloss enamel finish to match walls. Upgrade hinges as required.
Glass specification same as indicated at Note 2 above.
4 Two (2) new duplex outlet and two (2) tele/data outlets where
indicated (reception room of Existing Premises).
5 Fill opening from removed double entry door, construction to maintain
integrity of existing one hour tunnel corridor.
6 Relocate one (1) light switch.
First Amendment to Office Lease and Guaranty of Lease
Seagull Entertainment, Inc.
Page Three
i. Throughout Expansion Premises, all existing wallcovering to be
removed, walls prepped to receive new paint, paint to match
Existing Premises.
ii. Throughout Expansion Premises, demo existing carpet. Provide new
to match Suite #725.
iii. Refinish wood floor at entry room #701 (Expansion Premises).
iv. At room #716 (Expansion Premises), provide two (2) new recessed,
adjustable Halogen downlights.
v. At room #710 (Expansion Premises), provide line item cost to
remove existing wood shelving, and relocate to undetermined
location in existing Premises.
7. Security Deposit. Upon execution of this First Amendment, Tenant shall
increase its Security Deposit by $5,351.50 from $4,907.00 to $10,258.50.
8. Guaranty of Lease. Effective as of the Effective Date, the Guaranty of
Lease shall be expanded to cover the Expanded Premises.
9. No Broker. Tenant represents and warrants that it has dealt with no
broker, agent or other person in connection with this transaction other than
Xxxxxxxx Xxxx Company and that no broker, agent or other person brought about
this transaction other than Xxxxxxxx Xxxx Company, and Tenant hereby agrees to
indemnify, defend, protect and hold Landlord harmless from and against any
claims, losses, liabilities, demands, costs, expenses or causes of action by any
broker, agent or other person claiming any commission or other form of
compensation by virtue of having dealt with Tenant with regard to this
transaction.
10. Further Assurances. In addition to the obligations required to be
performed under the Lease as amended hereby, Landlord and Tenant shall each
perform such other acts, and shall execute, acknowledge and/or/or deliver such
other instruments, documents and other materials, as may be reasonably required
in order to accomplish the intent and purposes of the Lease, as hereby amended.
First Amendment to Office Lease and Guaranty of Lease
Seagull Entertainment, Inc.
Page Four
11. Authority. Each party hereby represent and warrants to the other that
it has the due power and authority to enter into this Amendment and to be bound
by the terms hereof.
12. Binding Effect. This Amendment shall be binding upon and inure to the
benefit of Landlord, its successors and assigns and Tenant and its successors
and assigns.
13. Attorney's Fees. Should any party initiate a legal proceeding against
any other party, including an arbitration, then the prevailing party shall be
entitled to receive reasonable attorney's fees and costs incurred in connection
with such legal proceeding.
14. Counterparts. This Amendment may be excluded in any number of
counterparts, each of which shall be an original, but all of which shall
constitute one and the same instrument.
15. No Other Amendment. Except as modified by this Amendment, the
provisions of the Lease (including all exhibits thereto) shall remain unaffected
and in full force and effect. To the extent that any terms or provisions of this
Amendment are inconsistent with any terms or provisions of the Lease, the terms
and provisions of this Amendment shall control.
IN WITNESS WHEREOF, the parties hereto have executed this First Amendment
as of the day and year first above written.
LANDLORD: TENANT:
KGK ENTERPRISES, INC., Seagull Entertainment, Inc.
a California corporation
By: Xxxxxxxx Xxxx NW Inc.
its Managing Agent
By: By: /s/ Xxxx Xxxxxx
----------------------------- ------------------------------
Xxxxxx X. Xxxxxxx Xxxx Xxxxxx
Its: Executive Vice President By: /s/ Xxxxx Xxxxxx
------------------------------
Xxxxx Xxxxxx
