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Exhibit 10.47
[California Net Lease]
LEASE AGREEMENT
THIS LEASE AGREEMENT is made this 28th day of July, 1997, between SCI
Limited Partnership-I, a Delaware Limited Partnership, ("Landlord"), and the
Tenant named below.
TENANT: CXR Telcom Corporation, a
Delaware Corporation
TENANT'S REPRESENTATIVE, Xxxxx Xxxxxx
ADDRESS, AND PHONE NO.: 0000 Xxxxxxx Xxxxx
Xxxxx 000
Xxx Xxxx, XX 00000
000-000-0000
PREMISES: That portion of the Building, containing
approximately 29,120 rentable square feet, as
determined by Landlord and commonly known as 00000
Xxxxxxx Xxxxxxxxx, Xxxxxxx, XX as shown on Exhibit
A, and the floor plan as shown as Exhibit B.
PROJECT: Bayside Commons
BUILDING: Shoreline Business Center #8 (14508)
TENANT'S PROPORTIONATE SHARE
OF PROJECT: 39%
TENANT'S PROPORTIONATE SHARE
OF BUILDING: 71%
LEASE TERM: Beginning on the Commencement Date and ending on the last
day of the 60th full calendar month thereafter.
COMMENCEMENT DATE: Upon substantial completion of tenant improvements estimated
to be October 10, 1997.
INITIAL MONTHLY BASE RENT: Twenty Seven Thousand Six Hundred Sixty Four Dollars
$27,664
INITIAL ESTIMATED MONTHLY 1. Utilities: $127
OPERATING EXPENSE PAYMENTS:
(estimates only and subject to 2. Common Area Charges: $1,134
adjustment to actual costs and
expenses according to the 3. Taxes: $3,951
provisions of this Lease)
4. Insurance: $97
INITIAL ESTIMATED MONTHLY
OPERATING EXPENSE PAYMENTS: $5,309
INITIAL MONTHLY BASE RENT AND
OPERATING EXPENSE PAYMENTS: $32,973
SECURITY DEPOSIT: $57,075 - $27,664 of said Security Deposit will be refunded to
Tenant when MicroTel ("Guarantor") provides Landlord with audited
financial statements at year end 1997 or there after showing net
income in excess of $1,000,000
BROKER: Xxx Xxxxxx/Colliers Xxxxxxx International, Inc.
ADDENDA: Addendum I, II, III, IV, V and VI Exhibit A, B, B-1, C and
Guarantee
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1. GRANTING CLAUSE. In consideration of the obligation of Tenant to pay
rent as herein provided and in consideration of the other terms, covenants, and
conditions hereof, Landlord leases to Tenant, and Tenant takes from Landlord,
the Premises, to have and to hold for the Lease Term, subject to the terms,
covenants and conditions of this Lease.
2. ACCEPTANCE OF PREMISES. Tenant shall accept the Premises in its
condition as of the Commencement Date, subject to all applicable laws,
ordinances, regulations, covenants and restrictions. Landlord has made no
representation or warranty as to the suitability of the Premises for the conduct
of Tenant's business, and Tenant waives any implied warranty that the Premises
are suitable for Tenant's intended purposes. Except as provided in Paragraph 10,
in no event shall Landlord have any obligation for any defects in the Premises
or any limitation on its use. The taking of possession of the Premises shall be
conclusive evidence that Tenant accepts the Premises and that the Premises were
in good condition at the time possession was taken except for items that are
Landlord's responsibility under Paragraph 10 and any punchlist items agreed to
in writing by Landlord and Tenant. ANY WORK PERFORMED BY LANDLORD AT ITS SOLE
COST PRIOR TO THE COMMENCEMENT DATE SHALL BE IN COMPLIANCE WITH ALL THE
APPLICABLE LAWS.
LANDLORD SHALL DELIVER ALL BUILDING SYSTEMS (HVAC, ELECTRICAL, PLUMBING
AND MECHANICAL) IN GOOD OPERATING CONDITION AND REPAIR. LANDLORD SHALL WARRANT
THESE SYSTEMS REMAIN IN GOOD OPERATING CONDITION AND REPAIR FOR A PERIOD ENDING
SIX (6) MONTHS AFTER THE COMMENCEMENT DATE. LANDLORD AGREES TO REPAIR ALL ROOF
LEAKS AT LANDLORD'S SOLE COST AND EXPENSE (NOT TO BE PASSED THROUGH TO TENANT AS
AN OPERATING EXPENSE) FROM THE COMMENCEMENT DATE THROUGH DECEMBER 31, 1997.
PROVIDED TENANT IS RESPONSIBLE FOR ALL NORMAL MAINTENANCE COSTS TO ALL OF THE
ABOVE ITEMS DURING THIS PERIOD.
3. USE. The Premises shall be used only for the purpose of receiving,
storing, shipping and selling (but limited to wholesale sales) products,
materials and merchandise made and/or distributed by Tenant and for such other
lawful purposes as may be incidental thereto; provided, however, Tenant may also
use the Premises for light manufacturing. Tenant shall not conduct or give
notice of any auction, liquidation, or going out of business sale on the
Premises. Tenant will use the Premises in a careful, safe and proper manner and
will not commit waste, overload the floor or structure of the Premises or
subject the Premises to use that would damage the Premises. Tenant shall not
permit any objectionable or unpleasant odors, smoke, dust, gas, noise, or
vibrations to emanate from the Premises, or take any other action that would
constitute a nuisance or would disturb, unreasonably interfere with, or endanger
Landlord or any tenants of the Project. Outside storage, including without
limitation, storage of trucks and other vehicles, is prohibited without
Landlord's prior written consent. Tenant, at its sole expense, shall use and
occupy the Premises in compliance with all laws, including, without limitation,
the Americans With Disabilities Act, orders, judgments, ordinances, regulations,
codes, directives, permits, licenses, covenants and restrictions now or
hereafter applicable to the Premises (collectively, "Legal Requirements"). The
Premises shall not be used as a place of public accommodation under the
Americans With Disabilities Act or similar state statutes or local ordinances or
any regulations promulgated thereunder, all as may be amended from time to time.
Tenant shall, at its expense, make any alterations or modifications, within or
without the Premises, that are required by Legal Requirements related to
Tenant's use or occupation of the Premises. Tenant will not use or permit the
Premises to be used for any purpose or in any manner that would void Tenant's or
Landlord's insurance, increase the insurance risk, or cause the disallowance of
any sprinkler credits. If any increase in the cost of any insurance on the
Premises or the Project is caused by Tenant's use or occupation of the Premises,
or because Tenant vacates the Premises, then Tenant shall pay the amount of such
increase to Landlord. Any occupation of the Premises by Tenant prior to the
Commencement Date shall be subject to all obligations of Tenant under this
Lease.
4. BASE RENT. Tenant shall pay Base Rent in the amount set forth above.
The first month's Base Rent, the Security Deposit, and the first monthly
installment of estimated Operating Expenses (as hereafter defined) shall be due
and payable on the date hereof, and Tenant promises to pay to Landlord in
advance, without demand, deduction or set-off, monthly installments of Base Rent
on or before the first day of each calendar month succeeding the Commencement
Date. Payments of Base Rent for any fractional calendar month shall be prorated.
All payments required to be made by Tenant to Landlord hereunder shall be
payable at such address as Landlord may specify from time to time by written
notice delivered in accordance herewith. The obligation of Tenant to pay Base
Rent and other sums to Landlord and the obligations of Landlord under this Lease
are independent obligations. Tenant shall have no right at any time to xxxxx,
reduce, or set-off any rent due hereunder except as may be expressly provided in
this Lease. Tenant waives and releases all statutory liens and offset rights as
to rent. If Tenant is delinquent in any monthly installment of Base Rent or of
estimated Operating Expenses for more than 5 days, Tenant shall pay to Landlord
on demand a late charge equal to 5 percent of such delinquent sum.
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The provision for such late charge shall be in addition to all of Landlord's
other rights and remedies hereunder or at law and shall not be construed as a
penalty.
5. SECURITY DEPOSIT. The Security Deposit shall be held by Landlord as
security for the performance of Tenant's obligations under this Lease. The
Security Deposit is not an advance rental deposit or a measure of Landlord's
damages in case of Tenant's default. Upon each occurrence of an Event of Default
(hereinafter defined), Landlord may use all or part of the Security Deposit to
pay delinquent payments due under this Lease, and the cost of any damage,
injury, expense or liability caused by such Event of Default, without prejudice
to any other remedy provided herein or provided by law. Tenant shall pay
Landlord on demand the amount that will restore the Security Deposit to its
original amount. Landlord's obligation respecting the Security Deposit is that
of a debtor, not a trustee; no interest shall accrue thereon. The Security
Deposit shall be the property of Landlord, but shall be paid to Tenant when
Tenant's obligations under this Lease have been completely fulfilled. Landlord
shall be released from any obligation with respect to the Security Deposit upon
transfer of this Lease and the Premises to a person or entity assuming
Landlord's obligations under this Paragraph 5. LANDLORD SHALL RETURN THE
SECURITY DEPOSIT WITHIN SIXTY (60) DAYS AFTER EXPIRATION OR EARLIER TERMINATION
OF THE LEASE TERM AFTER TENANT HAS VACATED, PENDING THE TIME IT TAKES TO REPAIR
ITEMS NECESSARY TO BRING THE SPACE BACK TO A CONDITION REFERENCED IN PARAGRAPH
21.
6. OPERATING EXPENSE PAYMENTS. During each month of the Lease Term, on the
same date that Base Rent is due, Tenant shall pay Landlord an amount equal to
1/12 of the annual cost, as estimated by Landlord from time to time, of Tenant's
Proportionate Share (hereinafter defined) of Operating Expenses for the Project.
Payments thereof for any fractional calendar month shall be prorated. The term
"Operating Expenses" means all costs and expenses incurred by Landlord with
respect to the ownership, maintenance, and operation of the Project including,
but not limited to costs of: Taxes (hereinafter defined) and fees payable to tax
consultants and attorneys for consultation and contesting taxes; insurance;
utilities; maintenance, repair and replacement of all portions of the Project,
including without limitation, paving and parking areas, roads, roofs alleys, and
driveways, mowing, landscaping, exterior painting, utility lines, heating,
ventilation and air conditioning systems, lighting, electrical systems and other
mechanical and building systems; amounts paid to contractors and subcontractors
for work or services performed in connection with any of the foregoing; charges
or assessments of any association to which the Project is subject; property
management fees payable to a property manager, including any affiliate of
Landlord, or if there is no property manager, an administration fee of 10
percent of Operating Expenses payable to Landlord; security services, if any;
trash collection, sweeping and removal; and additions or alterations made by
Landlord to the Project or the Building in order to comply with Legal
Requirements (other than those expressly required herein to be made by Tenant)
or that are appropriate to the continued operation of the Project or the
Building as a bulk warehouse facility in the market area, provided that the cost
of additions or alterations that are required to be capitalized for federal
income tax purposes shall be amortized on a straight line basis over a period
equal to the lesser of the useful life thereof for federal income tax purposes.
Operating Expenses do not include costs, or expenses, depreciation or
amortization for capital repairs and capital replacements required to be made by
Landlord under Paragraph 10 of this Lease, debt service under mortgages or
ground rent under ground leases, costs of restoration to the extent of net
insurance proceeds received by Landlord with respect thereto, leasing
commissions, or the costs of renovating space for tenants.
If Tenant's total payments of Operating Expenses for any year are
less than Tenant's Proportionate Share of actual Operating Expenses for such
year, then Tenant shall pay the difference to Landlord within 30 days after
demand, and if more, then Landlord shall retain such excess and credit it
against Tenant's next payments. For purposes of calculating Tenant's
Proportionate Share of Operating Expenses, a year shall mean a calendar year
except the first year, which shall begin on the Commencement Date, and the last
year, which shall end on the expiration of this Lease. With respect to Operating
Expenses which Landlord allocates to the entire Project, Tenant's "Proportionate
Share" shall be the percentage set forth on the first page of this Lease as
Tenant's Proportionate Share of the Project as reasonably adjusted by Landlord
in the future for changes in the physical size of the Premises or the Project;
and, with respect to Operating Expenses which Landlord allocates only to the
Building, Tenant's "Proportionate Share" shall be the percentage set forth on
the first page of this Lease as Tenant's Proportionate Share of the Building as
reasonably adjusted by Landlord in the future for changes in the physical size
of the Premises or the Building. Landlord may equitably increase Tenant's
Proportionate Share for any item of expense or cost reimbursable by Tenant that
relates to a repair, replacement, or service that benefits only the Premises or
only a portion of the Project or Building that includes the Premises or that
varies with occupancy or use. The estimated Operating Expenses for the Premises
set forth on the first page of this Lease are only estimates, and Landlord makes
no guaranty or warranty that such estimates will be accurate.
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AT ANY TIME WITHIN 3 MONTHS AFTER LANDLORD HAS ISSUED A STATEMENT OF
OPERATING EXPENSES PAYABLE BY TENANT, AND AFTER AT LEAST 2 DAYS PRIOR WRITTEN
NOTICE TO LANDLORD, TENANT WILL HAVE THE RIGHT TO REVIEW AND AUDIT THE BOOKS AND
RECORDS OF LANDLORD RELATING TO SUCH OPERATING EXPENSES DURING NORMAL BUSINESS
HOURS AND AT THE OFFICE OF LANDLORD AT WHICH SUCH BOOKS AND RECORDS ARE
ROUTINELY MAINTAINED. THE AUDIT WILL BE CONDUCTED AT TENANT'S EXPENSE BY A
CERTIFIED PUBLIC ACCOUNTANT LICENSED IN THE STATE IN WHICH THE PREMISES ARE
SITUATED OR BY TENANT'S CONTROLLER. IF TENANT'S AUDIT REVEALS THAT THE OPERATING
EXPENSES CHARGED TO TENANT EXCEED OR WERE LESS THAN TENANT'S PROPORTIONATE SHARE
OF THE ACTUAL OPERATING EXPENSES, AND SUCH VARIANCE IS CONFIRMED BY LANDLORD'S
CERTIFIED PUBLIC ACCOUNTANT, THEN LANDLORD WILL REIMBURSE TENANT FOR ANY
OVERCHARGE, OR TENANT WILL PAY TO LANDLORD ANY UNDERCHARGE, AS APPLICABLE,
PROMPTLY AFTER SUCH FINAL DETERMINATION. IN THE EVENT OF A CONFIRMED OVERCHARGE
OF OPERATING EXPENSES TO TENANT IN EXCESS OF 5% OF TENANT'S PROPORTIONATE SHARE
OF ACTUAL OPERATING EXPENSES IN SUCH YEAR, LANDLORD ALSO SHALL REIMBURSE TENANT
FOR THE REASONABLE COST OF TENANT'S AUDIT IF SUCH AUDIT WAS CONDUCTED BY AN
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT, BUT NOT IN EXCESS OF AN AMOUNT EQUAL TO
$1,500.
7. UTILITIES. Tenant shall pay for all water, gas, electricity, heat,
light, power, telephone, sewer, sprinkler services, refuse and trash collection,
and other utilities and services used on the Premises, all maintenance charges
for utilities, and any storm sewer charges or other similar charges for
utilities imposed by any governmental entity or utility provider, together with
any taxes, penalties, surcharges or the like pertaining to Tenant's use of the
Premises. Landlord may cause at Tenant's expense any utilities to be separately
metered or charged directly to Tenant by the provider. Tenant shall pay its
share of all charges for jointly metered utilities based upon consumption, as
reasonably determined by Landlord. No interruption or failure of utilities shall
result in the termination of this Lease or the abatement of rent. Tenant agrees
to limit use of water and sewer for normal restroom use.
8. TAXES. Landlord shall pay all taxes, assessments and governmental
charges (collectively referred to as "Taxes") that accrue against the Project
during the Lease Term, which shall be included as part of the Operating Expenses
charged to Tenant. Landlord may contest by appropriate legal proceedings the
amount, validity, or application of any Taxes or liens thereof. All capital
levies or other taxes assessed or imposed on Landlord upon the rents payable to
Landlord under this Lease and any franchise tax, any excise, transaction, sales
or privilege tax, assessment, levy or charge measured by or based, in whole or
in part, upon such rents from the Premises and/or the Project or any portion
thereof shall be paid by Tenant to Landlord monthly in estimated installments or
upon demand, at the option of Landlord, as additional rent; provided, however,
in no event shall Tenant be liable for any net income taxes imposed on Landlord
unless such net income taxes are in substitution for any Taxes payable
hereunder. If any such tax or excise is levied or assessed directly against
Tenant, then Tenant shall be responsible for and shall pay the same at such
times and in such manner as the taxing authority shall require. Tenant shall be
liable for all taxes levied or assessed against any personal property or
fixtures placed in the Premises, whether levied or assessed against Landlord or
Tenant.
9. INSURANCE. Landlord shall maintain all risk property insurance covering
the full replacement cost of the Building. Landlord may, but is not obligated
to, maintain such other insurance and additional coverages as it may deem
necessary, including, but not limited to, commercial liability insurance and
rent loss insurance. All such insurance shall be included as part of the
Operating Expenses charged to Tenant. The Project or Building may be included in
a blanket policy (in which case the cost of such insurance allocable to the
Project or Building will be determined by Landlord based upon the insurer's cost
calculations). Tenant shall also reimburse Landlord for any increased premiums
or additional insurance which Landlord reasonably deems necessary as a result of
Tenant's use of the Premises.
Tenant, at its expense, shall maintain during the Lease Term: all risk
property insurance covering the full replacement cost of all property and
improvements installed or placed in the Premises by Tenant at Tenant's expense;
worker's compensation insurance with no less than the minimum limits required by
law; employer's liability insurance with such limits as required by law; and
commercial liability insurance, with a minimum limit of $1,000,000 per
occurrence and a minimum umbrella limit of $1,000,000, for a total minimum
combined general liability and umbrella limit of $2,000,000 (together with such
additional umbrella coverage as Landlord may reasonably require) for property
damage, personal injuries, or deaths of persons occurring in or about the
Premises. Landlord may from time to time require reasonable increases in any
such limits. The commercial liability policies shall name Landlord as an
additional insured, insure on an occurrence and not a claims-made basis, be
issued by insurance companies which are reasonably acceptable to Landlord, not
be cancelable unless 30 days' prior written notice shall have been given to
Landlord, contain a hostile fire endorsement and a contractual liability
endorsement and provide primary coverage to Landlord (any policy issued to
Landlord providing
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duplicate or similar coverage shall be deemed excess over Tenant's policies).
Such policies or certificates thereof shall be delivered to Landlord by Tenant
upon commencement of the Lease Term and upon each renewal of said insurance.
The all risk property insurance obtained by Landlord and Tenant shall
include a waiver of subrogation by the insurers and all rights based upon an
assignment from its insured, against Landlord or Tenant, their officers,
directors, employees, managers, agents, invitees and contractors, in connection
with any loss or damage thereby insured against. Neither party nor its officers,
directors, employees, managers, agents, invitees or contractors shall be liable
to the other for loss or damage caused by any risk coverable by all risk
property insurance, and each party waives any claims against the other party,
and its officers, directors, employees, managers, agents, invitees and
contractors for such loss or damage. The failure of a party to insure its
property shall not void this waiver. Landlord and its agents, employees and
contractors shall not be liable for, and Tenant hereby waives all claims against
such parties for, business interruption and losses occasioned thereby sustained
by Tenant or any person claiming through Tenant resulting from any accident or
occurrence in or upon the Premises or the Project from any cause whatsoever,
including without limitation, damage caused in whole or in part, directly or
indirectly, by the negligence of Landlord or its agents, employees or
contractors.
10. LANDLORD'S REPAIRS. Landlord shall maintain, at its expense, the
structural soundness of the roof, AND STRUCTURAL SUPPORTS AND COLUMNS,
foundation, and exterior walls of the Building in good repair, reasonable wear
and tear and uninsured losses and damages caused by Tenant, its agents and
contractors excluded. The term "walls" as used in this Paragraph 10 shall not
include windows, glass or plate glass, doors or overhead doors, special store
fronts, dock bumpers, dock plates or revelers, or office entries. Tenant shall
promptly give Landlord written notice of any repair required by Landlord
pursuant to this Paragraph 10, after which Landlord shall have a reasonable
opportunity to repair.
11. TENANT'S REPAIRS. Landlord, at Tenant's expense as provided in
Paragraph 6, shall maintain in good repair and condition the parking areas and
other common areas of the Building, including, but not limited to driveways,
alleys, landscape and grounds surrounding the Premises. Subject to Landlord's
obligation in Paragraph 10 and subject to Paragraphs 9 and 15, Tenant, at its
expense, shall repair, replace and maintain in good condition all portions of
the Premises and all areas, improvements and systems exclusively serving the
Premises including, without limitation, dock and loading areas, truck doors,
plumbing, water, and sewer lines up to points of common connection, fire
sprinklers and fire protection systems, entries, doors, ceilings and roof
membrane, windows, interior walls, and the interior side of demising walls, and
heating, ventilation and air conditioning systems. Such repair and replacements
include capital expenditures and repairs whose benefits may extend beyond the
Term. Heating, ventilation and air conditioning systems and other mechanical and
building systems serving the Premises shall be maintained at Tenant's expense
pursuant to maintenance service contracts entered into by Tenant or, at
Landlord's election, by Landlord. The scope of services and contractors under
such maintenance contracts shall be reasonably approved by Landlord. At
Landlord's request, Tenant shall enter into a joint maintenance agreement with
any railroad that services the Premises. If Tenant fails to perform any repair
or replacement for which it is responsible, Landlord may perform such work and
be reimbursed by Tenant within 10 days after demand therefor. Subject to
Paragraphs 9 and 15, Tenant shall bear the full cost of any repair or
replacement to any part of the Building or Project that results from damage
caused by Tenant, its agents, contractors, or invitees and any repair that
benefits only the Premises. ANY REPAIR OVER $15,000 (MAJOR REPAIR) OF WHICH
TENANT IS RESPONSIBLE SHALL BE PAID BY TENANT AND AMORTIZED OVER THE USEFUL LIFE
FOR FEDERAL INCOME TAX PURPOSES.
12. TENANT-MADE ALTERATIONS AND TRADE FIXTURES. Any alterations,
additions, or improvements made by or on behalf of Tenant to the Premises
("Tenant-Made Alterations") shall be subject to Landlord's prior written
consent. Tenant shall cause, at its expense, all Tenant-Made Alterations to
comply with insurance requirements and with Legal Requirements and shall
construct at its expense any alteration or modification required by Legal
Requirements as a result of any Tenant-Made Alterations. All Tenant-Made
Alterations shall be constructed in a good and workmanlike manner by contractors
reasonably acceptable to Landlord and only good grades of materials shall be
used. All plans and specifications for any Tenant-Made Alterations shall be
submitted to Landlord for its approval UPON TENANT REQUEST, LANDLORD SHALL
ADVISE TENANT IN WRITING WHETHER IT RESERVES THE RIGHT TO REQUIRE TENANT TO
REMOVE ANY ALTERATIONS FROM THE PREMISES UPON TERMINATION OF THE LEASE. Landlord
may monitor construction of the Tenant-Made Alterations. Tenant shall reimburse
Landlord for its costs in reviewing plans and specifications and in monitoring
construction. Landlord's right to review plans and specifications and to monitor
construction shall be solely for its own benefit, and Landlord shall have no
duty to see that such plans and specifications or construction comply with
applicable laws, codes, rules and regulations. Tenant shall provide Landlord
with the identities and mailing addresses of all persons performing work or
supplying materials, prior to beginning such construction, and Landlord may post
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on and about the Premises notices of non-responsibility pursuant to applicable
law. Tenant shall furnish security or make other arrangements satisfactory to
Landlord to assure payment for the completion of all work free and clear of
liens and shall provide certificates of insurance for worker's compensation and
other coverage in amounts and from an insurance company satisfactory to Landlord
protecting Landlord against liability for personal injury or property damage
during construction. Upon completion of any Tenant-Made Alterations, Tenant
shall deliver to Landlord sworn statements setting forth the names of all
contractors and subcontractors who did work on the Tenant-Made Alterations and
final lien waivers from all such contractors and subcontractors. Upon surrender
of the Premises, all Tenant-Made Alterations and any leasehold improvements
constructed by Landlord or Tenant shall remain on the Premises as Landlord's
property, except to the extent Landlord requires removal at Tenant's expense of
any such items or Landlord and Tenant have otherwise agreed in writing in
connection with Landlord's consent to any Tenant-Made Alterations. Tenant shall
repair any damage caused by such removal.
Tenant, at its own cost and expense and without Landlord's prior approval,
may erect such shelves, bins, machinery and trade fixtures (collectively "Trade
Fixtures") in the ordinary course of its business provided that such items do
not alter the basic character of the Premises, do not overload or damage the
Premises, and may be removed without injury to the Premises, and the
construction, erection, and installation thereof complies with all Legal
Requirements and with Landlord's requirements set forth above. Tenant shall
remove its Trade Fixtures and shall repair any damage caused by such removal.
13. SIGNS. Tenant shall not make any changes to the exterior of the
Premises, install any exterior lights, decorations, balloons, flags, pennants,
banners, or painting, or erect or install any signs, windows or door lettering,
placards, decorations, or advertising media of any type which can be viewed from
the exterior of the Premises, without Landlord's prior written consent. Upon
surrender or vacation of the Premises, Tenant shall have removed all signs and
repair, paint, and/or replace the building facia surface to which its signs are
attached. Tenant shall obtain all applicable governmental permits and approvals
for sign and exterior treatments. All signs, decorations, advertising media,
blinds, draperies and other window treatment or bars or other security
installations visible from outside the Premises shall be subject to Landlord's
approval and conform in all respects to Landlord's requirements.
14. PARKING. Tenant shall be entitled to park in common with other tenants
of the Project in those areas designated for nonreserved parking. Landlord may
allocate parking spaces among Tenant and other tenants in the Project if
Landlord determines that such parking facilities are becoming crowded. Landlord
shall not be responsible for enforcing Tenant's parking rights against any third
parties.
15. RESTORATION. If at any time during the Lease Term the Premises are
damaged by a fire or other casualty, Landlord shall notify Tenant within 60 days
after such damage as to the amount of time Landlord reasonably estimates it will
take to restore the Premises. If the restoration time is estimated to exceed 6
months, either Landlord or Tenant may elect to terminate this Lease upon notice
to the other party given no later than 30 days after Landlord's notice. If
neither party elects to terminate this Lease or if Landlord estimates that
restoration will xxxx 0 months or less, then, subject to receipt of sufficient
insurance proceeds, Landlord shall promptly restore the Premises excluding the
improvements installed by Tenant or by Landlord and paid by Tenant, subject to
delays arising from the collection of insurance proceeds or from Force Majeure
events. Tenant at Tenant's expense shall promptly perform, subject to delays
arising from the collection of insurance proceeds, or from Force Majeure events,
all repairs or restoration not required to be done by Landlord and shall
promptly re-enter the Premises and commence doing business in accordance with
this Lease. Notwithstanding the foregoing, either party may terminate this Lease
if the Premises are damaged during the last year of the Lease Term and Landlord
reasonably estimates that it will take more than one month to repair such
damage. Tenant shall pay to Landlord with respect to any damage to the Premises
the amount of the commercially reasonable deductible under Landlord's insurance
policy (currently $10,000) within 10 days after presentment of Landlord's
invoice. If the damage involves the Premises of other tenants, Tenant shall pay
the portion of the deductible that the cost of the restoration of the Premises
bears to the total cost of restoration, as determined by Landlord. Base Rent and
Operating Expenses shall be abated for the period of repair and restoration in
the proportion which the area of the Premises, if any, which is not usable by
Tenant bears to the total area of the Premises. Such abatement shall be the sole
remedy of Tenant, and except as provided herein, Tenant waives any right to
terminate the Lease by reason of damage or casualty loss.
16. CONDEMNATION. If any part of the Premises or the Project should be
taken for any public or quasi-public use under governmental law, ordinance, or
regulation, or by right of eminent domain, or by private purchase in lieu
thereof (a "Taking" or "Taken"), and the Taking would prevent or materially
interfere with Tenant's use of the Premises or in Landlord's judgment would
materially interfere with or impair its ownership or operation of the Project,
then upon written notice by Landlord this Lease shall terminate and Base Rent
shall be apportioned as of said date. If part of the Premises shall be Taken,
and
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this Lease is not terminated as provided above, the Base Rent payable hereunder
during the unexpired Lease Term shall be reduced to such extent as may be fair
and reasonable under the circumstances. In the event of any such Taking,
Landlord shall be entitled to receive the entire price or award from any such
Taking without any payment to Tenant, and Tenant hereby assigns to Landlord
Tenant's interest, if any, in such award. Tenant shall have the right, to the
extent that same shall not diminish Landlord's award, to make a separate claim
against the condemning authority (but not Landlord) for such compensation as may
be separately awarded or recoverable by Tenant for moving expenses and damage to
Tenant's Trade Fixtures, if a separate award for such items is made to Tenant.
17. ASSIGNMENT AND SUBLETTING. Without Landlord's prior written consent,
which Landlord shall not unreasonably withhold, Tenant shall not assign this
Lease or sublease the Premises or any part thereof or mortgage, pledge, or
hypothecate its leasehold interest or grant any concession or license within the
Premises and any attempt to do any of the foregoing shall be void and of no
effect. For purposes of this paragraph, a transfer of the ownership interests
controlling Tenant shall be deemed an assignment of this Lease unless such
ownership interests are publicly traded. Notwithstanding the above, Tenant may
assign or sublet the Premises, or any part thereof, to any entity controlling
Tenant, controlled by Tenant or under common control with Tenant (a "Tenant
Affiliate"), without the prior written consent of Landlord. Tenant shall
reimburse Landlord for all of Landlord's reasonable out-of-pocket expenses in
connection with any assignment or sublease IN AN AMOUNT NOT TO EXCEED $500.00.
Upon Landlord's receipt of Tenant's written notice of a desire to assign or
sublet the Premises, or any part thereof (other than to a Tenant Affiliate),
Landlord may, by giving written notice to Tenant within 10 days after receipt of
Tenant's notice, terminate this Lease with respect to the space described in
Tenant's notice, as of the date specified in Tenant's notice for the
commencement of the proposed assignment or sublease. If Landlord so terminates
the Lease, Landlord may enter into a lease directly with the proposed sublease
or assignee. Tenant may withdraw its notice to sublease or assign by notifying
Landlord within 10 days after Landlord has given Tenant notice of such
termination, in which case the Lease shall not terminate but shall continue.
It shall be reasonable for the Landlord to withhold its consent to
any assignment or sublease in any of the following instances: (i) an Event of
Default has occurred and is continuing that would not be cured upon the proposed
sublease or assignment; (ii) the assignee or sublessee does not have a net worth
calculated according to generally accepted accounting principles at least equal
the net worth of the Tenant at the time it executed the Lease; (iii) the
intended use of the Premises by the assignee or sublessee is not reasonably
satisfactory to Landlord; (iv) the intended use of the Premises by the assignee
or sublessee would materially increase the pedestrian or vehicular traffic to
the Premises or the Project; (v) occupancy of the Premises by the assignee or
sublessee would, in Landlord's opinion, violate an agreement binding upon
Landlord or the Project with regard to the identity of tenants, usage in the
Project, or similar matters; (vi) the identity or business reputation of the
assignee or sublessee will, in the good faith judgment of Landlord, tend to
damage the goodwill or reputation of the Project; (vii) the assignment or sublet
is to another tenant in the Project and is at rates which are below those
charged by Landlord for comparable space in the Project; (viii) in the case of a
sublease, the subtenant has not acknowledged that the Lease controls over any
inconsistent provision in the sublease; or (ix) the proposed assignee or
sublessee is a governmental agency. Tenant and Landlord acknowledge that each of
the foregoing criteria are reasonable as of the date of execution of the Lease.
The foregoing criteria shall not exclude any other reasonable basis for Landlord
to refuse its consent to such assignment or sublease. Any approved assignment or
sublease shall be expressly subject to the terms and conditions of this Lease.
Tenant shall provide to Landlord all information concerning the assignee or
sublessee as Landlord may request.
Notwithstanding any assignment or subletting, Tenant and any
guarantor or surety of Tenant's obligations under this Lease shall at all times
remain fully responsible and liable for the payment of the rent and for
compliance with all of Tenant's other obligations under this Lease (regardless
of whether Landlord's approval has been obtained for any such assignments or
sublettings). In the event that the rent ACTUALLY PAID by a sublessee or
assignee (or a combination of the rental payable under such sublease or
assignment plus any bonus or other consideration therefor or incident thereto)
exceeds the rental payable under this Lease, then Tenant shall be bound and
obligated to pay Landlord as additional rent hereunder 50% OF such excess rental
and other excess consideration AFTER DEDUCTING TENANT'S REASONABLE, OUT OF
POCKET COSTS TO EFFECT THE ASSIGNMENT OR SUBLEASE, INCLUDING, WITHOUT
LIMITATION, BROKERAGE COMMISSION, LEGAL FEES, AND REDECORATING AND REFURBISHING
COSTS, (ALL SAID COSTS SHALL BE AMORTIZED OVER THE REMAINING LEASE TERM PRIOR TO
DEDUCTING FROM ADDITIONAL RENT) within 10 days following receipt thereof by
Tenant.
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If this Lease be assigned or if the Premises be subleased (whether
in whole or in part) or in the event of the mortgage, pledge, or hypothecation
of Tenant's leasehold interest or grant of any concession or license within the
Premises or if the Premises be occupied in whole or in part by anyone other than
Tenant, then upon a default by Tenant hereunder Landlord may collect rent from
the assignee, sublessee, mortgagee, pledgee, party to whom the leasehold
interest was hypothecated, concessionee or licensee or other occupant and,
except to the extent set forth in the preceding paragraph, apply the amount
collected to the next rent payable hereunder; and all such rentals collected by
Tenant shall be held in trust for Landlord and immediately forwarded to
Landlord. No such transaction or collection of rent or application thereof by
Landlord, however, shall be deemed a waiver of these provisions or a release of
Tenant from the further performance by Tenant of its covenants, duties, or
obligations hereunder.
18. INDEMNIFICATION. Except for the negligence OR WILLFUL MISCONDUCT of
Landlord, its agents, employees or contractors, and to the extent permitted by
law, Tenant agrees to indemnify, defend and hold harmless Landlord, and
Landlord's agents, employees and contractors, from and against any and all
losses, liabilities, damages, costs and expenses (including attorneys' fees)
resulting from claims by third parties for injuries to any person and damage to
or theft or misappropriation or loss of property occurring in or about the
Project and arising from the use and occupancy of the Premises or from any
activity, work, or thing done, permitted or suffered by Tenant in or about the
Premises or due to any other act or omission of Tenant, its subtenants,
assignees, invitees, employees, contractors and agents. The furnishing of
insurance required hereunder shall not be deemed to limit Tenant's obligations
under this Paragraph 18.
19. INSPECTION AND ACCESS. Landlord and its agents, representatives, and
contractors may enter the Premises at any reasonable time to inspect the
Premises and to make such repairs as may be required or permitted pursuant to
this Lease and for any other business purpose. Landlord and Landlord's
representatives may enter the Premises during business hours for the purpose of
showing the Premises to prospective purchasers and, during the LAST SIX (6)
MONTHS of the Lease Term, to prospective tenants. Landlord may erect a suitable
sign on the Premises stating the Premises are available to let or that the
Project is available for sale. Landlord may grant easements, make public
dedications, designate common areas and create restrictions on or about the
Premises, provided that no such easement, dedication, designation or restriction
materially interferes with Tenant's use or occupancy of the Premises. At
Landlord's request, Tenant shall execute such instruments as may be necessary
for such easements, dedications or restrictions. LANDLORD OR ITS AGENTS SHALL
GIVE TENANT 24 HOURS NOTICE EXCEPT IN CASE OF EMERGENCY, TENANTS REPRESENTATION
SHALL BE PRESENT.
20. QUIET ENJOYMENT. If Tenant shall perform all of the covenants and
agreements herein required to be performed by Tenant, Tenant shall, subject to
the terms of this Lease, at all times during the Lease Term, have peaceful and
quiet enjoyment of the Premises against any person claiming by, through or under
Landlord.
21. SURRENDER. Upon termination of the Lease Term or earlier termination
of Tenant's right of possession, Tenant shall surrender the Premises to Landlord
in the same condition as received, broom clean, ordinary wear and tear and
casualty loss and condemnation covered by Paragraphs 15 and 16 excepted. Any
Trade Fixtures, Tenant-Made Alterations and property not so removed by Tenant as
permitted or required herein shall be deemed abandoned and may be stored,
removed, and disposed of by Landlord at Tenant's expense, and Tenant waives all
claims against Landlord for any damages resulting from Landlord's retention and
disposition of such property. All obligations of Tenant hereunder not fully
performed as of the termination of the Lease Term shall survive the termination
of the Lease Term, including without limitation, indemnify obligations, payment
obligations with respect to Operating Expenses and obligations concerning the
condition and repair of the Premises.
22. HOLDING OVER. If Tenant retains possession of the Premises after the
termination of the Lease Term, unless otherwise agreed in writing, such
possession shall be subject to immediate termination by Landlord at any time,
and all of the other terms and provisions of this Lease (excluding any expansion
or renewal option or other similar right or option) shall be applicable during
such holdover period, except that Tenant shall pay Landlord from time to time,
upon demand, as Base Rent for the holdover period, an amount equal to 150% OF
the Base Rent in effect on the termination date, computed on a monthly basis for
each month or part thereof during such holding over. All other payments shall
continue under the terms of this Lease. In addition, Tenant shall be liable for
all damages incurred by Landlord as a result of such holding over. No holding
over, by Tenant, whether with or without consent of LANDLORD, WHICH SHALL NOT BE
UNREASONABLY WITHHELD shall operate to extend this Lease except as otherwise
expressly provided, and this Paragraph 22 shall not be construed as consent for
Tenant to retain possession of the Premises.
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23. EVENTS OF DEFAULT. Each of the following events shall be an event of
default ("Event of Default") by Tenant under this Lease:
(i) TENANT SHALL FAIL TO PAY ANY INSTALLMENT OF BASE RENT OR ANY
OTHER PAYMENT REQUIRED HEREIN WHEN DUE, AND SUCH FAILURE SHALL CONTINUE
FOR A PERIOD OF 5 DAYS AFTER WRITTEN NOTICE PROVIDED THAT LANDLORD SHALL
NOT BE REQUIRED TO PROVIDE NOTICE OF MONETARY DEFAULT MORE THAN TWICE IN
ANY 12 MONTH PERIOD OR MORE THAN FOUR (4) TIMES DURING THE TERM OF THIS
LEASE (AS IT MAY BE EXTENDED) FROM THE DATE SUCH PAYMENT WAS DUE.
(ii) Tenant or any guarantor or surety of Tenant's obligations
hereunder shall (A) make a general assignment for the benefit of
creditors; (B) commence any case, proceeding or other action seeking to
have an order for relief entered on its behalf as a debtor or to
adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, liquidation, dissolution or composition of it or
its debts or seeking appointment of a receiver, trustee, custodian or
other similar official for it or for all or of any substantial part of its
property (collectively a "proceeding for relief"); (C) become the subject
of any proceeding for relief which is not dismissed within 60 days of its
filing or entry; or (D) die or suffer a legal disability (if Tenant,
guarantor, or surety is an individual) or be dissolved or otherwise fail
to maintain its legal existence (if Tenant, guarantor or surety is a
corporation, partnership or other entity).
(iii) Any insurance required to be maintained by Tenant pursuant to
this Lease shall be cancelled or terminated or shall expire or shall be
reduced or materially changed, except, in each case, as permitted in this
Lease.
(iv) Tenant shall not occupy or shall vacate the Premises or shall
fail to continuously operate its business at the Premises for the
permitted use set forth herein, whether or not Tenant is in monetary or
other default under this Lease.
(v) Tenant shall attempt or there shall occur any assignment,
subleasing or other transfer of Tenant's interest in or with respect to
this Lease except as otherwise permitted in this Lease.
(vi) Tenant shall fail to discharge any lien placed upon the
Premises in violation of this Lease within 30 days after any such lien or
encumbrance is filed against the Premises.
(vii) Tenant shall fail to Comply with any provision of this Lease
other than those specifically referred to in this Paragraph 23, and except
as otherwise expressly provided herein, such default shall continue for
more than 30 days after Landlord shall have given Tenant written notice of
such default, UNLESS THE NATURE OF THE DEFAULT IS SUCH THAT IT CANNOT BE
REASONABLY CURED WITHIN 30 DAYS, IN WHICH EVENT TENANT SHALL NOT BE IN
DEFAULT HEREUNDER SO LONG AS TENANT COMMENCES THE CURE WITHIN 30 DAYS AND
THEREAFTER DILIGENTLY PROSECUTES SUCH CURE TO COMPLETION, BUT, SUBJECT TO
PARAGRAPH 33, IN NO EVENT SHALL SUCH CURE PERIOD EXTEND BEYOND 90 DAYS.
24. LANDLORD'S REMEDIES. Upon each occurrence of an Event of Default and
so long as such Event of Default shall be continuing, Landlord may at any time
thereafter at its election: terminate this Lease or Tenant's right of possession
(but Tenant shall remain liable as hereinafter provided), and/or pursue any
other remedies at law or in equity. Upon the termination of this Lease or
termination of Tenant's right of possession, it shall be lawful for Landlord,
without formal demand or notice of any kind, to re-enter the Premises by summary
dispossession proceedings or any other action or proceeding authorized by law
and to remove Tenant and all persons and property therefrom. If Landlord
re-enters the Premises, Landlord shall have the right to keep in place and use,
or remove and store, all of the furniture, fixtures and equipment at the
Premises.
Except as otherwise provided in the next paragraph, if Tenant
breaches this Lease and abandons the Premises prior to the end of the term
hereof, or if Tenant's right to possession is terminated by Landlord because of
an Event of Default by Tenant under this Lease, this Lease shall terminate. Upon
such termination Landlord may recover from Tenant the following, as provided in
Section 1951.2 of the Civil Code of California: (i) the worth at the time of
award of the unpaid Base Rent and other charges under this Lease that had been
earned at the time of termination; (ii) the worth at the time of award of the
amount by which the reasonable value of the unpaid Base Rent and other charges
under this Lease 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; (iii) the worth at the time of award by which the
reasonable value of the unpaid Base Rent and other charges under this Lease for
the balance of the
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term of this Lease after the time of award exceeds the amount of such rental
loss that Tenant proves could have been reasonably avoided; and (iv) any other
amount necessary to compensate Landlord for all the detriment proximately caused
by Tenant's failure to perform its obligations under this Lease or that in the
ordinary course of things would be likely to result therefrom. As used herein,
the following terms are defined: (a) The "worth at the time of award" of the
amounts referred to in Sections (i) and (ii) is computed by allowing interest at
the lesser of 18 percent per annum or the maximum lawful rate. The "worth at the
time of award" of the amount referred to in Section (iii) is computed by
discounting such amount at the discount rate of the Federal Reserve Bank of San
Francisco at the time of award plus one percent; (b) The "time of award" as used
in clauses (i), (ii), and (iii) above is the date on which judgment is entered
by a court of competent jurisdiction; (c) The "reasonable value" of the amount
referred to in clause (ii) above is computed by determining the mathematical
product of (1) the "reasonable annual rental value" (as defined herein) and (2)
the number of years, including fractional parts thereof, between the date of
termination and the time of award. The "reasonable value" of the amount referred
to in clause (iii) is computed by determining the mathematical product of (1)
the annual Base Rent and other charges under this Lease and (2) the number of
years including fractional parts thereof remaining in the balance of the term of
this Lease after the time of award.
Even though Tenant has breached this Lease and abandoned the
Premises, this Lease shall continue in effect for so long as Landlord does not
terminate Tenant's right to possession, and Landlord may enforce all its rights
and remedies under this Lease, including the right to recover rent as it becomes
due. This remedy is intended to be the remedy described in California Civil Code
Section 1951.4, and the following provision from such Civil Code Section is
hereby repeated: "The Lessor has the remedy described in California Civil Code
Section 1951.4 (lessor may continue lease in effect after lessee's breach and
abandonment and recover rent as it becomes due, if lessee has right to sublet or
assign, subject only to reasonable limitations)." Any such payments due
Landlord shall be made upon demand therefor from time to time and Tenant agrees
that Landlord may file suit to recover any sums falling due from time to time.
Notwithstanding any such reletting without termination, Landlord may at any time
thereafter elect in writing to terminate this Lease for such previous breach.
Exercise by Landlord of any one or more remedies hereunder granted
or otherwise available shall not be deemed to be an acceptance of surrender of
the Premises and/or a termination of this Lease by Landlord, whether by
agreement or by operation of law, it being understood that such surrender and/or
termination can be effected only by the written agreement of Landlord and
Tenant. Any law, usage, or custom to the contrary notwithstanding, Landlord
shall have the right at all times to enforce the provisions of this Lease in
strict accordance with the terms hereof; and the failure of Landlord at any time
to enforce its rights under this Lease strictly in accordance with same shall
not be construed as having created a custom in any way or manner contrary to the
specific terms, provisions, and covenants of this Lease or as having modified
the same. Tenant and Landlord further agree that forbearance or waiver by
Landlord to enforce its rights pursuant to this Lease or at law or in equity,
shall not be a waiver of Landlord's right to enforce one or more of its rights
in connection with any subsequent default. A receipt by Landlord of rent or
other payment with knowledge of the breach of any covenant hereof shall not be
deemed a waiver of such breach, and no waiver by Landlord of any provision of
this Lease shall be deemed to have been made unless expressed in writing and
signed by Landlord. To the greatest extent permitted by law, Tenant waives the
service of notice of Landlord's intention to re-enter as provided for in any
statute, or to institute legal proceedings to that end, and also waives all
right of redemption in case Tenant shall be dispossessed by a judgment or by
warrant of any court or judge. The terms "enter," "re-enter," "entry" or
"re-entry," as used in this Lease, are not restricted to their technical legal
meanings. Any reletting of the Premises shall be on such terms and conditions as
Landlord in its sole discretion may determine (including without limitation a
term different am the remaining Lease Term, rental concessions, alterations and
repair of the Premises, lease of less than the entire Premises to any tenant and
leasing any or all other portions of the Project before reletting the Premises).
Landlord shall not be liable, nor shall Tenant's obligations hereunder be
diminished, because of Landlord's failure to relet the Premises or collect rent
due in respect of such reletting, PROVIDED THAT NOT WITHSTANDING ANYTHING TO THE
CONTRARY CONTAINED HEREIN LANDLORD SHALL HAVE A DUTY TO MITIGATE DAMAGES UPON AN
EVENT OF DEFAULT.
25. TENANT'S REMEDIES/LIMITATION OF LIABILITY. Landlord shall not be in
default hereunder unless Landlord fails to perform any of its obligations
hereunder within 30 days after written notice from Tenant specifying such
failure (unless such performance will, due to the nature of the obligation,
require a period of time in excess of 30 days, then after such period of time as
is reasonably necessary). All obligations of Landlord hereunder shall be
construed as covenants, not conditions; and, except as may be otherwise
expressly provided in this Lease, Tenant may not terminate this Lease for breach
of Landlord's obligations hereunder. All obligations of Landlord under this
Lease will be binding upon Landlord only during the period of its ownership of
the Premises and not thereafter. The term
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"Landlord" in this Lease shall mean only the owner, for the time being of the
Premises, and in the event of the transfer by such owner of its interest in the
Premises, such owner shall thereupon be released and discharged from all
obligations of Landlord thereafter accruing, but such obligations shall be
binding during the Lease Term upon each new owner for the duration of such
owner's ownership. Any liability of Landlord under this Lease shall be limited
solely to its interest in the Project, and in no event shall any personal
liability be asserted against Landlord in connection with this Lease nor shall
any recourse be had to any other property or assets of Landlord.
26. WAIVER OF JURY TRIAL. TENANT AND LANDLORD WAIVE ANY RIGHT TO TRIAL BY
JURY OR TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN
CONTRACT, TORT, OR OTHERWISE, BETWEEN LANDLORD AND TENANT ARISING OUT OF THIS
LEASE OR ANY OTHER INSTRUMENT, DOCUMENT, OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH OR THE TRANSACTIONS RELATED HERETO.
27. SUBORDINATION. This Lease and Tenant's interest and rights hereunder
are and shall be subject and subordinate at all times to the lien of any first
mortgage, now existing or hereafter created on or against the Project or the
Premises, and all amendments, restatements, renewals, modifications,
consolidations, refinancing, assignments and extensions thereof, without the
necessity of any further instrument or act on the part of Tenant. Tenant agrees,
at the election of the holder of any such mortgage, to attorn to any such
holder. Tenant agrees upon demand to execute, acknowledge and deliver such
instruments, confirming such subordination and such instruments of attornment as
shall be requested by any such holder. Notwithstanding the foregoing, any such
holder may at any time subordinate its mortgage to this Lease, without Tenant's
consent, by notice in writing to Tenant, and thereupon this Lease shall be
deemed prior to such mortgage without regard to their respective dates of
execution, delivery or recording and in that event such holder shall have the
same rights with respect to this Lease as though this Lease had been executed
prior to the execution, delivery and recording of such mortgage and had been
assigned to such holder. The term "mortgage" whenever used in this Lease shall
be deemed to include deeds of trust, security assignments and any other
encumbrances, and any reference to the "holder" of a mortgage shall be deemed to
include the beneficiary under a deed of trust.
28. MECHANIC'S LIENS. Tenant has no express or implied authority to create
or place any lien or encumbrance of any kind upon, or in any manner to bind the
interest of Landlord or Tenant in, the Premises or to charge the rentals payable
hereunder for any claim in favor of any person dealing with Tenant, including
those who may furnish materials or perform labor for any construction or
repairs. Tenant covenants and agrees that it will pay or cause to be paid all
sums legally due and payable by it on account of any labor performed or
materials furnished in connection with any work performed on the Premises and
that it will save and hold Landlord harmless from all loss, cost or expense
based on or arising out of asserted claims or liens against the leasehold estate
or against the interest of Landlord in the Premises or under this Lease. Tenant
shall give Landlord immediate written notice of the placing of any lien or
encumbrance against the Premises and cause such lien or encumbrance to be
discharged within 30 days of the filing or recording thereof, provided, however,
Tenant may contest such liens or encumbrances as long as such contest prevents
foreclosure of the lien or encumbrance and Tenant causes such lien or
encumbrance to be bonded or insured over in a manner satisfactory to Landlord
within such 30 day period.
29. ESTOPPEL CERTIFICATES. Tenant agrees, from time to time, within 10
days after request of Landlord, to execute and deliver to Landlord, or
Landlord's designee, any estoppel certificate requested by Landlord, stating
that this Lease is in full force and effect, the date to which rent has been
paid, that Landlord is not in default hereunder (or specifying in detail the
nature of Landlord's default), the termination date of this Lease and such other
matters pertaining to this Lease as may be requested by Landlord. Tenant's
obligation to furnish each estoppel certificate in a timely fashion is a
material inducement for Landlord's execution of this Lease. No cure or grace
period provided in this Lease shall apply to Tenant's obligations to timely
deliver an estoppel certificate. Tenant hereby irrevocably appoints Landlord as
its attorney in fact to execute on its behalf and in its name any such estoppel
certificate if Tenant fails to execute and deliver the estoppel certificate
within 10 days after Landlord's written request thereof.
30. ENVIRONMENTAL REQUIREMENTS. Except for Hazardous Material contained in
products used by Tenant in de minimis quantities for ordinary cleaning and
office purposes AND PROVIDED IN ADDENDUM VI, Tenant shall not permit or cause
any party to bring any Hazardous Material upon the Premises or transport, store,
use, generate, manufacture or release any Hazardous Material in or about the
Premises without Landlord's prior written consent. Tenant, at its sole cost and
expense, shall operate its business in the Premises in strict compliance with
all Environmental Requirements and shall remediate
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in manner satisfactory to Landlord any Hazardous Materials released on or from
the Project by Tenant, its agents, employees, contractors, subtenants or
invitees. Tenant shall complete and certify to disclosure statements as
requested by Landlord from time to time relating to Tenant's transportation,
storage, use, generation, manufacture, or release of Hazardous Materials on the
Premises. The term "Environmental Requirements" means all applicable present and
future statutes, regulations, ordinances, rules, codes, judgments, orders or
other similar enactments of any governmental authority or agency regulating or
relating to health, safety, or environmental conditions on, under, or about the
Premises or the environment, including without limitation, the following: the
Comprehensive Environmental Response, Compensation and Liability Act; the
Resource Conservation and Recovery Act; and all state and local counterparts
thereto, and any regulations or policies promulgated or issued thereunder. The
term "Hazardous Materials" means and includes any substance, material, waste,
pollutant, or contaminant listed or defined as hazardous or toxic, under any
Environmental Requirements, asbestos and petroleum, including crude oil or any
fraction thereof, natural gas, or synthetic gas usable for fuel (or mixtures of
natural gas and such synthetic gas). As defined in Environmental Requirements,
Tenant is and shall be deemed to be the "operator" of Tenant's "facility"
and the "owner" of all Hazardous Materials brought on the Premises by Tenant,
its agents, employees, contractors or invitees, and the wastes, by-products, or
residues generated, resulting, or produced therefrom.
Tenant shall indemnify, defend, and hold Landlord harmless from and
against any and all losses (including, without limitation, diminution in value
of the Premises or the Project and loss of rental income from the Project),
claims, demands, actions, suits, damages (including, without limitation,
punitive damages), expenses (including, without limitation, remediation,
removal, repair, corrective action, or cleanup expenses), and costs (including,
without limitation, actual attorneys' fees, consultant fees or expert fees and
including, without limitation, removal or management of any asbestos brought
into the Premises or disturbed in breach of the requirements of this Paragraph
30, regardless of whether such removal or management is required by law) which
are brought or recoverable against, or suffered or incurred by Landlord as a
result of any release of Hazardous Materials for which Tenant is obligated to
remediate as provided above or any other breach of the requirements under this
Paragraph 30 by Tenant, its agents, employees, contractors, subtenants,
assignees or invitees, regardless of whether Tenant has knowledge of such
noncompliance. The obligations of Tenant under this Paragraph 30 shall survive
any termination of this Lease.
Landlord shall have access to, and a right to perform inspections
and tests of, the Premises to determine Tenant's compliance with Environmental
Requirements, its obligations under this Paragraph 30, or the environmental
condition of the Premises. Access shall be granted to Landlord upon Landlord's
prior notice to Tenant and at such times so as to minimize, so far as may be
reasonable under the circumstances, any disturbance to Tenant's operations. Such
inspections and tests shall be conducted at Landlord's expense, unless such
inspections or tests reveal that Tenant has not complied with any Environmental
Requirement, in which case Tenant shall reimburse Landlord for the reasonable
cost of such inspection and tests. Landlord's receipt of or satisfaction with
any environmental assessment in no way waives any rights that Landlord holds
against Tenant.
31. RULES AND REGULATIONS. Tenant shall, at all times during the Lease
Term and any extension thereof, comply with all reasonable rules and regulations
at any time or from time to time established by Landlord covering use of the
Premises and the Project. The current rules and regulations are attached hereto.
In the event of any conflict between said rules and regulations and other
provisions of this Lease, the other terms and provisions of this Lease shall
control. Landlord shall not have any liability or obligation for the breach of
any rules or regulations by other tenants in the Project.
32. SECURITY SERVICE. Tenant acknowledges and agrees that, while Landlord
may patrol the Project, Landlord is not providing any security services with
respect to the Premises and that Landlord shall not be liable to Tenant for, and
Tenant waives any claim against Landlord with respect to, any loss by theft or
any other damage suffered or incurred by Tenant in connection with any
unauthorized entry into the Premises or any other breach of security with
respect to the Premises.
33. FORCE MAJEURE. Landlord shall not be held responsible for delays in
the performance of its obligations hereunder when caused by strikes, lockouts,
labor disputes, acts of God, inability to obtain labor or materials or
reasonable substitutes therefor, governmental restrictions, governmental
regulations, governmental controls, delay in issuance of permits, enemy or
hostile governmental action, civil commotion, fire or other casualty, and other
causes beyond the reasonable control of Landlord ("Force Majeure").
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34. ENTIRE AGREEMENT. This Lease constitutes the complete agreement of
Landlord and Tenant with respect to the subject matter hereof. No
representations, inducements, promises or agreements, oral or written, have been
made by Landlord or Tenant, or anyone acting on behalf of Landlord or Tenant,
which are not contained herein, and any prior agreements, promises,
negotiations, or representations are superseded by this Lease. This Lease may
not be amended except by an instrument in writing signed by both parties hereto.
35. SEVERABILITY. If any clause or provision of this Lease is illegal,
invalid or unenforceable under present or future laws, then and in that event,
it is the intention of the partlease is illegal, invalid or unenforceable under
present is hereto that the remainder of this Lease shall not be affected
thereby. It is also the intention of the parties to this Lease that in lieu of
each clause or provision of this Lease that is illegal, invalid or
unenforceable, there be added, as a part of this Lease, a clause or provision as
similar in terms to such illegal, invalid or unenforceable clause or provision
as may be possible and be legal, valid and enforceable.
36. BROKERS. Tenant represents and warrants that it has dealt with no
broker, agent or other person in connection with this transaction and that no
broker, agent or other person brought about this transaction, other than the
broker, if any, set forth on the first page of this Lease, and Tenant agrees to
indemnify and hold Landlord harmless from and against any clause by any other
broker, agent or other person claiming a commission or other form of
compensation by virtue of having dealt with Tenant with regard to this leasing
transaction.
37. MISCELLANEOUS. (a) Any payments or charges due from Tenant to Landlord
hereunder shall be considered rent for all purposes of this Lease.
(b) If and when included within the term "Tenant," as used in this
instrument, there is more than one person, firm or corporation, each shall be
jointly and severally liable for the obligations of Tenant.
(c) All notices required or permitted to be given under this Lease shall
be in writing and shall be sent by registered or certified mail, return receipt
requested, or by a reputable national overnight courier service, postage
prepaid, or by hand delivery addressed to the parties at their addresses below,
and with a copy sent to Landlord at 00000 Xxxx 00xx Xxxxx, Xxxxxx, Xxxxxxxx
00000. Either party may by notice given aforesaid change its address for all
subsequent notices. Except where otherwise expressly provided to the contrary,
notice shall be deemed given upon delivery.
(d) Except as otherwise expressly provided in this Lease or as otherwise
required by law, Landlord retains the absolute right to withhold any consent or
approval.
(e) At Landlord's request BUT NO MORE THAN ONCE PER YEAR, Tenant shall
furnish Landlord with true and complete copies of its most recent annual and
quarterly financial statements prepared by Tenant or Tenant's accountants and
any other financial information or summaries that Tenant typically provides to
its lenders or shareholders.
(f) Neither this Lease nor a memorandum of lease shall be filed by or on
behalf of Tenant in any public record. Landlord may prepare and file, and upon
request by Landlord Tenant will execute, a memorandum of lease.
(g) The normal rule of construction to the effect that any ambiguities are
to be resolved against the drafting party shall not be employed in the
interpretation of this Lease or any exhibits or amendments hereto.
(h) The submission by Landlord to Tenant of this Lease shall have no
binding force or effect, shall not constitute an option for the leasing of the
Premises, nor confer any right or impose any obligations upon either party until
execution of this Lease by both parties.
(i) Words of any gender used in this Lease shall be held and construed to
include any other gender, and words in the singular number shall be held to
include the plural, unless the context otherwise requires. The captions inserted
in this Lease are for convenience only and in no way affect the interpretation
of this Lease.
(j) Any amount not paid by Tenant within 5 days after its due date in
accordance with the terms of this Lease shall bear interest from such due date
until paid in full at the lesser of the highest rate permitted by applicable law
or 15 percent per year. It is expressly the intent of Landlord and Tenant at
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all times to comply with applicable law governing the maximum rate or amount of
any interest payable on or in connection with this Lease. If applicable law is
ever judicially interpreted so as to render usurious any interest called for
under this Lease, or contracted for, charged, taken, reserved, or received with
respect to this Lease, then it is Landlord's and Tenant's express intent that
all excess amounts theretofore collected by Landlord be credited on the
applicable obligation (or, if the obligation has been or would thereby be paid
in full, refunded to Tenant), and the provisions of this Lease immediately shall
be deemed reformed and the amounts thereafter collectible hereunder reduced,
without the necessity of the execution of any new document, so as to comply with
the applicable law, but so as to permit the recovery of the fullest amount
otherwise called for hereunder.
(k) Construction and interpretation of this Lease shall be governed by the
laws of the state in which the Project is located, excluding any principles of
conflicts of laws.
(l) Time is of the essence as to the Performance of Tenant's and
Landlord's obligations under this Lease.
(m) All exhibits and addenda attached hereto are hereby incorporated into
this Lease and made a part hereof. In the event of any conflict between such
exhibits or addenda and the terms of this Lease, such exhibits or addenda shall
control.
38. LIMITATION OF LIABILITY OF TRUSTEES, SHAREHOLDERS, AND OFFICERS OF
SECURITY CAPITAL INDUSTRIAL TRUST. Any obligation or liability whatsoever of
Security Capital Industrial Trust, a Maryland real estate investment trust,
which may arise at any time under this Lease or any obligation or liability
which may be incurred by it pursuant to any other instrument, transaction, or
undertaking contemplated hereby shall not be personally binding upon, nor shall
resort for the enforcement thereof be had to the property of, its trustees,
directors, shareholders, officers, employees or agents, regardless of whether
such obligation or liability is in the nature of contract, tort, or otherwise.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the
day and year first above written.
TENANT: LANDLORD:
CXR Telcom Corporation, a SCI Limited Partnership-I, a
California Corporation Delaware Limited Partnership
By: /s/ Xxxxx Xxxxxx By: /s/ Xxx X. Xxxxxxxx
-------------------------------- -----------------------------------
Title: President Xxx X. Xxxxxxxx
Title: Senior Vice President
Address: Address:
0000 Xxxxxxx Xxxxx 00000 Xxxxxxx Xxxxxxxxx
Xxxxx 000 Xxxxxxx, XX 00000
Xxx Xxxx, XX 00000
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Rules and Regulations
1. The sidewalk, entries, and driveways of the Project shall not be
obstructed by Tenant, or its agents, or used by them for any purpose other
than ingress and egress to and from the Premises.
2. Tenant shall not place any objects, including antennas, outdoor furniture,
etc., in the parking areas, landscaped areas or other areas outside of its
Premises, or on the roof of the Project.
3. Except for seeing-eye dogs, no animals shall be allowed in the offices,
halls, or corridors in the Project.
4. Tenant shall not disturb the occupants of the Project or adjoining
buildings by the use of any radio or musical instrument or by the making
of loud or improper noises.
5. If Tenant desires telegraphic, telephonic or other electric connections in
the Premises, Landlord or its agent will direct the electrician as to
where and how the wires may be introduced; and, without such direction, no
boring or cutting of wires will be permitted. Any such installation or
connection shall be made at Tenant's expense.
6. Tenant shall not install or operate any steam or gas engine or boiler, or
other mechanical apparatus in the Premises, except as specifically
approved in the Lease. The use of oil, gas or inflammable liquids for
heating, lighting or any other purpose is expressly prohibited. Explosives
or other articles deemed extra hazardous shall not be brought into the
Project.
7. Parking any type of recreational vehicles is specifically prohibited on or
about the Project. Except for the overnight parking of operative vehicles,
no vehicle of any type shall be stored in the parking areas at any time.
In the event that a vehicle is disabled, it shall be removed within 48
hours. There shall be no "For Sale" or other advertising signs on or about
any parked vehicle. All vehicles shall be parked in the designated parking
areas in conformity with all signs and other markings. All parking will be
open parking, and no reserved parking, numbering or lettering of
individual spaces will be permitted except as specified by Landlord.
8. Tenant shall maintain the Premises free from rodents, insects and other
pests.
9. Landlord reserves the right to exclude or expel from the Project any
person who, in the judgment of Landlord, is intoxicated or under the
influence of liquor or drugs or who shall in any manner do any act in
violation of the Rules and Regulations of the Project.
10. Tenant shall not cause any unnecessary labor by reason of Tenant's
carelessness or indifference in the preservation of good order and
cleanliness. Landlord shall not be responsible to Tenant for any loss of
property on the Premises, however occurring, or for any damage done to the
effects of Tenant by the janitors or any other employee or person.
11. Tenant shall give Landlord prompt notice of any defects in the water, lawn
sprinkler, sewage, gas pipes, electrical lights and fixtures, heating
apparatus, or any other service equipment affecting the Premises.
12. Tenant shall not permit storage outside the Premises, including without
limitation, outside storage of trucks and other vehicles, or dumping of
waste or refuse or permit any harmful materials to be placed in any
drainage system or sanitary system in or about the Premises.
13. All moveable trash receptacles provided by the trash disposal firm for the
Premises must be kept in the trash enclosure areas, if any, provided for
that purpose.
14. No auction, public or private, will be permitted on the Premises or the
Project.
15. No awnings shall be placed over the windows in the Premises except with
the prior written consent of Landlord.
16. The Premises shall not be used for lodging, sleeping or cooking or for any
immoral or illegal purposes or for any purpose other than that specified
in the Lease. No gaming devices shall be operated in the Premises.
17. Tenant shall ascertain from Landlord the maximum amount of electrical
current which can safely be used in the Premises, taking into account the
capacity of the electrical wiring in the Project and the Premises and the
needs of other tenants, and shall not use more than such safe capacity.
Landlord's consent to the installation of electric equipment shall not
relieve Tenant from the obligation not to use more electricity than such
safe capacity.
18. Tenant assumes full responsibility for protecting the Premises from theft,
robbery and pilferage.
19. Tenant shall not install or operate on the Premises any machinery or
mechanical devices of a nature not directly related to Tenant's ordinary
use of the Premises and shall keep all such machinery free of vibration,
noise and air waves which may be transmitted beyond the Premises.
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HVAC Maintenance/Service Contract Requirements
A service contract with a Landlord approved HVAC contractor must become
effective within thirty (30) days of occupancy and service visits should be
performed on a quarterly basis. The following are the approved HVAC contractors:
Phoenix Heating and Air Conditioning 408/487-0390
Cal-Air Conditioning 408/947-0155
ICOM 408/298-8101
We suggest that you send the following list to one of the above HVAC contractors
to be assured that these items are included in the maintenance contract:
1. Adjust belt tension;
2. Lubricate all moving parts, as necessary;
3. Inspect and adjust all temperature and safety controls;
4. Check refrigeration system for leaks and operation;
5. Check refrigeration system for moisture;
6. Inspect compressor oil level and crank case heaters;
7. Check head pressure, suction pressure and oil pressure;
8. Inspect air filters and replace when necessary;
9. Check space conditions;
10. Check condensate drains and drain pans and clean, if necessary;
11. Inspect and adjust all valves;
12. Check and adjust dampers;
13. Run machine through complete cycle,
Note: A certificate must be provided for our files not later than thirty (30)
days after mutual execution hereof. Failure to provide such certificate or
perform said services, when required, shall constitute material default of
this lease.
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CXR
MATERIAL
LISTING
CXR MATERIAL SAFETY DATA SHEET
CXR # DESCRIPTION QUANTITY
----- ----------- --------
CXRXAMP1 WATER SOLUBLE MASK/PT-650 1 CASE (24 PER CASE)
CXRXAMP3 FLUX STRIPPER 9 CASES (12 PER CASE)
CXRXAMP4 KLEENOX OR-904 9 JARS - 16 OZ. EACH
CXRXAMP5 AQUA-SOL FLUX #183 55 GALLON DRUM (STORED OUTSIDE)
CXRXAMP6 BER SOLDER FOR PC BOARDS 13 BOXES (50 LBS. EACH)
CXRXAMP6 ISOPROPYL ALCOHOL 99% 00 XXXXXX XXXX (STORED OUTSIDE)
12 GALLON DRUM (INSIDE)
CXRXAMP11 2-TON CLEAR EPOXY HARDENER 1 TUBE
CXRXAMP12 KRAZY GLUE 203 10 BOTTLES
CXRXAMP13 KRAZY GLUE ACCELERATOR 10 BOTTLES
MISC SOLDER DROSS 30 GALLON DRUM
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ADDENDUM I
BASE RENT ADJUSTMENTS
ATTACHED TO AN A PART OF THE LEASE AGREEMENT
DATED JULY 28, 1997, BETWEEN
SCI Limited Partnership-I
and
CXR Telcom Corporation
Base Rent shall equal the following amounts for the respective periods set forth
below:
Period Monthly Base Rent
------ -----------------
10/l/97 to 9/30/99 $27,664
10/l/99 to 9/30/00 $28,538
10/l/00 to 9/30/02 $29,411
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ADDENDUM II
CONSTRUCTION
(TURNKEY)
ATTACHED TO AND A PART OF THE LEASE AGREEMENT
DATED JULY 28, 1997, BETWEEN
SCI Limited Partnership-I
and
CXR Telcom Corporation
(a) Landlord agrees to furnish or perform at Landlord's sole cost and
expense those items of construction and those improvements (the "Tenant
Improvements") specified below:
- New paint throughout except in the warehouse.
- Wall demolition per the plan.
- New walls and patching of carpet as required where walls demoed.
- New VCT at wave solder room and replace ceiling tiles.
- New carpet consisting of 30 oz. direct glue down cut pile or level loop
at the following rooms: engineering, demo room, conference room 2, PO 1,
reception area, sales and marketing & administration
- Patch carpet at po's 3&4, 6&7, & 9&10.
- VCT patching at production as required.
- New VCT in production material control room.
- Demolition as noted.
- Vision windows in two new doors.
- Reuse of existing doors and sidelights as needed.
- Seal and texture wallcovering where walls removed.
- Final Clean up.
- Minor HVAC and sprinkler rework for new work.
- Re-caulk existing sinks at all restrooms.
- Replace any damaged or soiled ceiling tiles.
- Shampoo carpets.
- VCT - striped; waxed
NOTE: Landlord shall also coordinate the retrofit of the existing lighting
systems for energy efficiency. CXR will contract and pay for the cost of
lighting retrofit in its entirety. CXR will receive the benefit of the rebate
given after the job has been completed.
(b) If Tenant shall desire any changes, Tenant shall so advise Landlord
in writing and Landlord shall determine whether such changes can be made in a
reasonable and feasible manner. Any and all costs of reviewing any requested
changes, and any and all costs of making any changes to the Tenant Improvements
which Tenant may request and which Landlord may agree to shall be at Tenant's
sole cost and expense and shall be paid to Landlord upon demand and before
execution of the change order.
(c) Landlord shall proceed with and complete the construction of the
Tenant Improvements. As soon as such improvements have been Substantially
Completed, Landlord shall notify Tenant in writing of the date that the Tenant
Improvements were Substantially Completed. Such date, unless an earlier date is
specified as the Commencement Date in this Lease or otherwise agreed to in
writing between Landlord and Tenant, shall be the "Commencement Date," unless
the completion of such improvements was delayed due to any act or omission of,
or delay caused by, Tenant including, without limitation, Tenant's failure to
approve plans, complete submittals or obtain permits within the time periods
agreed to by the parties or as reasonably required by Landlord, in which case
the Commencement Date shall be the date such improvements would have been
completed but for the delays caused by Tenant. The Tenant Improvements shall be
deemed substantially completed ("Substantially Completed") when, in the opinion
of the construction manager (whether an employee or agent of Landlord or a third
party construction manager), the Premises are substantially completed except for
punch list items which do not prevent in any material way the use of the
Premises for the purposes for which they were intended. After the Commencement
Date Tenant shall, upon demand, execute and deliver to Landlord a letter of
acceptance of delivery of the Premises.
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If Landlord has not achieved Substantial Completion of Tenant Improvements
on or before November 30, 1997, then Tenant may, at its option, terminate this
Lease and upon such termination Landlord shall promptly return the Security
Deposit to Tenant.
(d)The failure of Tenant to take possession of or to occupy the
Premises shall not serve to relieve Tenant of obligations arising on the
Commencement Date or delay the payment of rent by Tenant. Subject to applicable
ordinances and building codes governing Tenant's right to occupy or perform in
the Premises, Tenant shall be allowed to install its tenant improvements,
machinery, equipment, fixtures, or other property on the Premises during the
final stages of completion of construction provided that Tenant does not thereby
interfere with the completion of construction or cause any labor dispute as a
result of such installations, and provided further that Tenant does hereby agree
to indemnify, defend, and hold Landlord harmless from any loss or damage to such
property, and all liability, loss, or damage arising from any injury to the
Project or the property of Landlord, its contractors, subcontractors, or
materialmen, and any death or personal injury to any person or persons arising
out of such installations, whether or not any such loss, damage, liability,
death, or personal injury was caused by Landlord's negligence. Any such
occupancy or performance in the Premises shall be in accordance with the
provisions governing Tenant-Made Alterations and Trade Fixtures in the Lease,
and shall be subject to Tenant providing to Landlord satisfactory evidence of
insurance for personal injury and property damage related to such installations
and satisfactory payment arrangements with respect to installations permitted
hereunder. Delay in putting Tenant in possession of the Premises shall not serve
to extend the term of this Lease or to make Landlord liable for any damages
arising therefrom.
(e)Except for incomplete punch list items, Tenant upon the Commencement
Date shall have and hold the Premises as the same shall then be without any
liability or obligation on the part of Landlord for making any further
alterations or improvements of any kind in or about the Premises. Landlord
agrees to pass through any warranties received by Landlord for any Tenant
Improvements performed on Premises prior to commencement.
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ADDENDUM III
RENEWAL OPTION
(BASEBALL ARBITRATION)
ATTACHED TO AND A PART OF THE LEASE AGREEMENT
DATED JULY 28, 1997, BETWEEN
SCI Limited Partnership-I
and
CXR Telcom Corporation
(a)Provided that as of the time of the giving of the Extension Notice
and the Commencement Date of the Extension Term (as such terms are defined
below), (x) Tenant is the Tenant originally named herein, (y) Tenant actually
occupies all of the Premises initially demised under this Lease and any space
added to the Premises, and (z) no Event of Default exists, or would exist but
for the passage of time or the giving of notice, or both; then Tenant shall have
the right to extend the Lease Term for an additional term of 5 years (such
additional term is hereinafter called the "Extension Term") commencing on the
day following the expiration of the Lease Term (hereinafter referred to as the
"Commencement Date of the Extension Term"). Tenant must give Landlord notice
(hereinafter called the "Extension Notice") of its election to extend the term
of the Lease Term at least 9 months, but not more than 6 months, prior to the
scheduled expiration date of the Lease Term.
(b)The Base Rent payable by Tenant to Landlord during the Extension
Term shall be the greater of:
(i) the Base Rent in effect on the expiration of the Lease Term (if
the Base Rent is stated as an annual or other periodic rate, adjusted for the
length of the Lease Term), and
(ii) the Fair Market Rent, as defined and determined pursuant to
Paragraphs (c), (d), and (e) below.
(c)The term "Fair Market Rent" shall mean the Base Rent, expressed as
an annual rent per square foot of floor area, which Landlord would have received
from leasing the Premises for the Extension Term to an unaffiliated person which
is not then a tenant in the Project, assuming that such space were to be
delivered in "as-is" condition, and taking into account the rental which such
other tenant would most likely have paid for such premises, including market
escalations, provided that Fair Market Rent shall not in any event be less than
the Base Rent for the Premises as of the expiration of the Lease Term. Fair
Market Rent shall not be reduced by reason of any costs or expenses saved by
Landlord by reason of Landlord's not having to find a new tenant for the
Premises (including without limitation brokerage commissions, cost of
improvements necessary to prepare the space for such tenant's occupancy, rent
concession, or lost rental income during any vacancy period). Fair Market Rent
means only the rent component defined as Base Rent in the Lease and does not
include reimbursements and payments by Tenant to Landlord with respect to
operating expenses and other items payable or reimbursable by Tenant under the
Lease. In addition to its obligation to pay Base Rent (as determined herein),
Tenant shall continue to pay and reimburse Landlord as set forth in the Lease
with respect to such operating expenses and other items with respect to the
Premises during the Extension Term. The arbitration process described below
shall be limited to the determination of the Base Rent and shall not affect or
otherwise reduce or modify the Tenant's obligation to pay or reimburse Landlord
for such operating expenses and other reimbursable items.
(d)Landlord shall notify Tenant of its determination of the Fair Market
Rent (which shall be made in Landlord's sole discretion and shall in any event
be not less than the Base Rent in effect as of the expiration of the Lease Term)
for the Extension Term, and Tenant shall advise Landlord of any objection within
10 days of receipt of Landlord's notice. Failure to respond within the 10-day
period shall constitute Tenant's acceptance of such Fair Market Rent. If Tenant
objects, Landlord and Tenant shall conunence negotiations to attempt to agree
upon the Fair Market Rent within 30 days of Landlord's receipt of Tenant's
notice. If the parties cannot agree, each acting in good faith but without any
obligation to agree, then the Lease Term shall not be extended and shall
terminate on its scheduled termination date and Tenant shall have no further
right hereunder or any remedy by reason of the parties'
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failure to agree unless Tenant or Landlord invokes the arbitration procedure
provided below to determine the Fair Market Rent.
(e)Arbitration to determine the Fair Market Rent shall be in accordance
with the Real Estate Valuation Arbitration Rules of the American Arbitration
Association. Unless otherwise required by state law, arbitration shall be
conducted in the metropolitan area where the Project is located by a single
arbitrator unaffiliated with either party. Either party may elect to arbitrate
by sending written notice to the other party and the Regional Office of the
American Arbitration Association within 5 days after the 30-day negotiating
period provided in Paragraph (d), invoking the binding arbitration provisions of
this paragraph. Landlord and Tenant shall each submit to the arbitrator their
respective proposal of Fair Market Rent. The arbitrator must choose between the
Landlord's proposal and the Tenant's proposal and may not compromise between the
two or select some other amount. Notwithstanding any other provision herein, the
Fair Market Rent determined by the arbitrator shall not be less than, and the
arbitrator shall have no authority to determine a Fair Market Rent less than,
the Base Rent in effect as of the scheduled expiration of the Lease Term. The
cost of arbitration shall be paid by Landlord if the Fair Market Rent is that
proposed by Landlord and by Tenant if the Fair Market Rent is that proposed by
Tenant; and shall be borne equally otherwise. If the arbitrator has not
determined the Fair Market Rent as of the end of the Lease Term, Tenant shall
pay 105 percent of the Base Rent in effect under the Lease as of the end of the
Lease Term until the Fair Market Rent is determined as provided herein. Upon
such determination, Landlord and Tenant shall make the appropriate adjustments
to the payments between them.
(f)The parties consent to the jurisdiction of any appropriate court to
enforce the arbitration provisions of this Addendum and to enter judgment upon
the decision of the arbitrator.
(g)Except for the Base Rent as determined above, Tenant's occupancy of
the Premises during the Extension Term shall be on the same terms and conditions
as are in effect immediately prior to the expiration of the initial Lease Term;
provided, however, Tenant shall have no further right to extend the Lease Term
pursuant to this addendum or to any allowances, credits or abatements or options
to expand, contract, renew or extend the Lease.
(h)If Tenant does not send the Extension Notice within the period set
forth in Paragraph (a), Tenant's right to extend the Lease Term shall
automatically terminate. Time is of the essence as to the giving of the
Extension Notice and the notice of Tenant's objection under Paragraph (d).
(i)Landlord shall have no obligation to refurbish or otherwise improve
the Premises for the Extension Term. The Premises shall be tendered on the
Commencement Date of the Extension Term in "as-is" condition.
(j)If the Lease is extended for the Extension Term, then Landlord shall
prepare and Tenant shall execute an amendment to the Lease confirming the
extension of the Lease Term and the other provisions applicable thereto.
(k)If Tenant exercises its right to extend the term of the Lease for
the Extension Term pursuant to this Addendum, the term "Lease Term" as used in
the Lease, shall be construed to include, when practicable, the Extension Term
except as provided in (g) above.
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ADDENDUM IV
NON-DISTURBANCE AGREEMENT
ATTACHED TO AND A PART OF THE LEASE AGREEMENT
DATED JULY 28, 1997, BETWEEN
SCI Limited Partnership-I
and
CXR Telcom Corporation
Tenant shall not be obligated to subordinate the Lease or its interest
therein to any future mortgage, deed of trust or ground lease on the Project
unless concurrently with such subordination the holder of such mortgage or deed
of trust or the ground lessor under such ground lease agrees not to disturb
Tenant's possession of the Premises under the terms of the Lease in the event
such holder or ground lessor acquires title to the Premises through foreclosure,
deed in lieu of foreclosure or otherwise. Tenant shall be solely responsible for
any fees or expenses charged by the holder of such mortgage or deed of trust in
connection with the granting of such non-disturbance agreement.
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ADDENDUM V
VACATION OF PREMISES
ATTACHED TO AND A PART OF THE LEASE AGREEMENT
DATED JULY 28, 1997, BETWEEN
SCI Limited Partnership-I
and
CXR Telcom Corporation
Tenant's vacating of the Premises shall not constitute an Event of
Default if, prior to vacating the Premises, Tenant has made arrangements
reasonably acceptable to Landlord to (a) insure that Tenant's insurance for the
Premises will not be voided or cancelled with respect to the Premises as a
result of such vacancy, (b) insure that the Premises are secured and not subject
to vandalism, and (c) insure that the Premises will be properly maintained after
such vacation. Tenant shall inspect the Premises at least once each month and
report monthly in writing to Landlord on the condition of the Premises.
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ADDENDUM VI
STORAGE AND USE OF PERMITTED HAZARDOUS MATERIALS
ATTACHED TO AND A PART OF THE LEASE AGREEMENT
DATED JULY 28, 1997, BETWEEN
SCI Limited Partnership-I
and
CXR Telcom Corporation
1. Permitted Hazardous Materials and Use.
(a) Tenant has requested Landlord's consent to use the Hazardous
Materials listed below in its business at the Premises (the "Permitted Hazardous
Materials"). Subject to the conditions set forth herein, Landlord hereby
consents to the Use (hereinafter defined) of the Permitted Hazardous Materials.
Any Permitted Hazardous Materials on the Premises will be generated, used,
received, maintained, treated, stored, or disposed in a manner consistent with
good engineering practice and in compliance with all Environmental Requirements.
Permitted Hazardous Materials (including maximum quantities):
The storage, uses or processes involving the Permitted Hazardous
Materials (the "Use") are described below.
Use [If Limited to receiving and storage, so specify]:
2. No Current Investigation.
Tenant represents and warrants that it is not currently subject to an
inquiry, regulatory investigation, enforcement order, or any other proceeding
regarding the generation, use, treatment, storage, or disposal of a Hazardous
Material.
3. Notice and Reporting.
Tenant immediately shall notify Landlord in writing of any spill,
release, discharge, or disposal of any Hazardous Material in, on or under the
Premises or the Project. All reporting obligations imposed by Environmental
Requirements are strictly the responsibility of Tenant.
Tenant shall supply to Landlord within 5 business days after Tenant
first receives or sends the same, copies of all claims, reports, complaints,
notices, warnings or asserted violations relating in any way to Tenant's use of
the Premises.
4. Indemnification.
Tenant's indemnity obligation under the Lease with respect to Hazardous
Materials shall include indemnification for the liabilities, expenses and other
losses described therein as a result of the Use of the Hazardous Materials or
the breach of Tenant's obligations or representations set forth above. It is the
intent of this provision that Tenant be strictly liable to Landlord as a result
of the Use of Hazardous Materials without regard to the fault or negligence of
Tenant, Landlord or any third party.
5. Disposal Upon Lease Termination.
At the expiration or earlier termination of the Lease, Tenant, at its
sole cost and expense, shall: (i) remove and dispose off-site any drums,
containers, receptacles, structures, or tanks storing or containing Hazardous
Materials (or which have stored or contained Hazardous Materials) and the
contents thereof; (ii) remove, empty, and purge all underground and above ground
storage tank systems, including connected piping, of all vapors, liquids,
sludges and residues; and (iii) restore the Premises to its original condition.
Such activities shall be performed in compliance with all Environmental
Requirements and to the satisfaction of Landlord. Landlord's satisfaction with
such activities or the condition of the Premises does not waive, or release
Tenant from, any obligations hereunder.
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EXHIBIT A - SITE PLAN
[DIAGRAM]
EXHIBIT B - FLOOR PLAN - INTERIOR
[DIAGRAM]
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EXHIBIT B-1
SECURITY CAPITAL INDUSTRIAL TRUST
CUSTOMER FINISH WORK LETTER AGREEMENT
OFFICE-AREA
1. CABINETS: Coffee bar and/or lunch room base cabinet(s) shall be 6'0" long
plastic laminate with chrome wire pulls.
2. COUNTERTOPS: The coffee bar top shall have a square front edge with a 4"
splash in plastic laminate.
3. LAVATORY COUNTERTOPS: In multiple accommodation toilet rooms with multiple
lavatories, the lavatories shall be installed in a plastic laminated
countertop with a bullnose front edge and a 4" backsplash. Smaller tenant
spaces shall receive wall mounted lavatories.
4. ROOF INSULATION: The insulation above conditioned office area ceilings
shall be minimum R-11 fiberglass xxxxx.
5. THERMAL WALL INSULATION: Walls between conditioned and unconditioned
spaces shall receive minimum R-1 unfaced fiberglass batt insulation.
6. ACOUSTIC INSULATION: All toilet room walls and ceilings shall receive 3
1/2" unfaced fiberglass batt acoustic insulation.
7. DOORS AND FRAMES: 3'-0" x 7-0'x 1-3/4", solid core, birch, B-3 stain
prefinished with anodized aluminum frames or prefinished black (Timely)
steel frames.
8. INTERIOR DOOR HARDWARE: Schlage "AL" series Saturn in a brushed chrome 626
finish.
9. INTERIOR WINDOWS: None
10. MIRRORS: toilet rooms shall have mirrors the length of the lavatory top or
24 x 36 if the lavatory is wall hung.
11. DRYWALL PARTITIONS: office walls shall be undergrid 3-5/8" x 25 Ga. metal
studs at 24" o.c. with 5/8" gypsum board.
12. DRYWALL FINISH: All drywall and exposed concrete walls within the office
and toilet rooms shall receive a skip trowel textured or smooth finish.
13. WAINSCOT: Toilet room wet walls shall have 4'-6" high white Pionite
wainscot.
14. ACOUSTIC CEILING TILE: Office areas shall have an exposed grid acoustic
ceiling with 24" x 48" non-directional fissured tile, installed at 9'-0"
15. OFFICE CARPET: Designweave or Xxxx direct glue-down, 26 oz. face weight
level loop or 30 oz cut-pile carpet without pad.
16. LUNCH ROOM: shall have vinyl composition tile (VCT) flooring 1/8" gauge,
standard grade, as manufactured by Tarkett or Xxxxxxxxx.
17. RUBBER BASE: The office areas shall have a 4" high topset rubber base as
manufactured by Burke, Roppe, or Tarkett, installed in all areas receiving
floor covering except the toilet rooms.
18. TOILET ROOM: The flooring shall be sheet vinyl by Xxxxxxxxx "Suffield",
"Best of Both Worlds" or "Seagate" with a 6" covered base.
19. PAINT: One (1) coat of paint in a standard light color interior flat
latex, except in the toilet rooms and at the coffee bar which shall
receive one (1) coat of latex semi-gloss enamel over one (1) coat of PVA
sealer. If the walls are smooth finished, they shall receive two (2) coats
of paint.
20. TOILET ACCESSORIES: Napkin Disposals: Bobrick B-270 sanitary napkin
disposals in each women's toilet stall. Paper Towel Dispenser: Bobrick
B-369 (for single accommodation toilet rooms) or a Bobrick B-3944 (for
multiple accommodation toilet rooms) recessed paper towel dispenser with a
waste receptacle. Seat Cover Dispenser: Bobrick B-221 seat cover dispenser
in each toilet stall. Toilet Paper Holder: Bobrick B-686 double toilet
paper holder. Grab Bars: Bobrick No. B6806-36 and B6806-42 stainless steel
handicap grab bars per code.
21. TOILET PARTITIONS: Metal, floor mounted, overhead braced toilet partitions
with a backed enamel finish by Global Steel, Xxxxxxxxxxxxx or equal in
manufactures standard color.
22. BLINDS: All exterior windows, except storefront doors, shall receive
mini-blinds by Bali, "inside mount", in a light building standard color
with a valance.
23. PLUMBING FIXTURES AND TRIM:
Lavatory for vanity: American Standard or equal, "Oval Horizon", model
3303.013, white, self-rimming with a Delta Model 523 WF HDF single lever
type faucet assembly with a grid strainer and bright chrome finish.
Wall-hung lavatory: American Standard or equal, "Lucerne", model 0355.012,
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white, wall mounted lavatory with a Delta Model 523 WF HDP single lever
type faucet assembly with a grid strainer and bright chrome finish.
Water closet: American Standard or equal, "Cadet Aquameter", elongated,
1.5 GPF, model 3042.12, white, with an Olsonite #95 seat and a Xxxxx #111
flush valve.
Urinal: American Standard or equal, "Allbrook", model 6540.017, white,
with a Xxxxx 180-1.5 flush valve.
Coffee bar sink: Elkay or equal,"Peacemaker Starlite", model PSR-1918,
stainless steel, with a Delta #100 faucet.
Water heater: Sized to meet demand installed in a smitty pan draining into
a hub drain with a trap primer.
24. Fire sprinkler heads shall be chrome with white escutcheons, semirecessed,
not centered, on the ceiling tiles.
25. The HVAC system shall maintain 75 degrees indoors, on a 100 degree
outdoor day.
26. The HVAC system shall be connected to a 7-day skip-a-day time clock and
include a bypass timer at each thermostat.
27. All thermostats shall have an automatic change-over feature and a locking
cover.
28. Toilet rooms shall have an exhaust fan.
29. All conditioned areas shall have a supply register and a deducted return
register. Supply and return air registers shall be white baked enamel
2' x 2' with a perforated face, flush mounted. Supply air registers shall
have a 4-way blow.
30. Office lighting: shall be 2' x 4' three lamp lay-in fluorescent light
fixtures with standard acrylic lens and T-12 low watt type lamps, 75 foot
candles a 3' A.F.F. or as permitted by code but no less than two (2)
fixtures per office.
31. Furnish and install two (2) 110V duplex receptacles in each office.
32. Furnish and install a dedicated 110 volt fourplex outlet at the telephone
board and two dedicated 110V outlets at the coffee bar.
33. Furnish and install a 2" diameter P.V.C. or steel (where required by
code) conduit for phone system from the building telephone service
entrance to a telephone board within the tenant space.
WAREHOUSE
34. FULL HEIGHT DRYWALL PARTITIONS @ tenant demising walls: Metal studs with
one layer of 5/8" type "X" gypsum board on each side from the floor to the
roof deck.
35. OFFICE/WAREHOUSE WALL: Metal studs with two layers of 5/8" type "X" gypsum
board on each side to 6" A.F.F.
36. WAREHOUSE WALL FINISH: All drywall shall be fire taped only. Spot nails in
firetaped areas.
37. CONCRETE FLOOR SEALER: Exposed concrete floors shall receive one coat of
acrylic concrete sealer.
38. WAREHOUSE LIGHTING: Provide 16' high output fluorescent strip light
fixtures or metal halide fixtures to achieve 15 foot candles of light
measured at 30" above the floor in the warehouse space.
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EXHIBIT C
SIGN CRITERIA
BAYSIDE COMMONS
WINDOW SIGNS IDENTIFICATION:
Each Tenant will be allowed one window sign placed either to the left or to the
right of the entrance door, whichever provides the best visibility.
Company names, logos or symbols will be allowed in this area - color and size to
be determined by the Tenant, all other copy in this area except for logos or
symbols will be white pressure sensitive letters.
Copy should start at 5' from grade working down to no more than 3 1/2' from
grade. Sign layout including copy, sizes and color must be approved by the
building management.
One security decal only may be applied to the front door glass in the lower
xxxxx if the Tenant so desires. All exterior alarm bells are to be mounted to
the rear of the building only.
DIRECTORY SIGN IDENTIFICATION:
A monument directory sign has been provided for each building. If only one
tenant occupies an entire building, that Tenant shall be allowed to utilize the
entire directory sign area for its sensitive vinyl letters in the Handel Gothic
style with a letter height suitable for the area allowed, and a logo may be
used. Layout is to be approved by building management.
If two Tenants occupy a building, signs shall consist of 4: Handel Gothic,
Spar-Cal dark mauve pressure sensitive vinyl letters condensed to 60.4%.
Directory signs shall list the street number and the company names only, no
slogans or symbols allowed.
If three Tenants occupy a building, signs shall consist of 4: Handel Gothic,
Spar-Cal dark mauve pressure sensitive vinyl letters condensed to 60.4%.
Directory signs shall list the street number and the company names only, no
slogans or symbols allowed.
REAR LOADING SIGNS:
Each Tenant will be allowed to identify its rear door for shipping and receiving
purposes. The company name shall be placed on a 36" x 24" aluminum panel
adjacent to the rear doors.
Copy shall consist of 3" vinyl capital letters only in the Spar-Cal dark mauve
Handel Gothic style. Company names and logos only are allowed.
MANAGEMENT RESERVES THE RIGHT TO DENY ANY COPY IT CONSIDERS UNSUITABLE. LAYOUT
IS TO BE APPROVED BY BUILDING MANAGEMENT. THE COST OF ALL LETTERING AND LOGOS
WILL BE THE RESPONSIBILITY OF THE TENANT. NO OTHER SIGNS ARE ALLOWED IN THE
WINDOWS OR DOORS.
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LEASE GUARANTY (CORPORATION)
The undersigned (collectively the "Guarantor") hereby absolutely and
unconditionally, jointly and severally, guarantees the prompt, complete, and
full punctual payments by the Tenant under that certain Lease Agreement (such
lease, as amended, being herein referred to as the "Lease"), dated July 28,
1997, between SCI Limited Partnership, a Delaware Limited Partnership, as
Landlord ("Landlord"), and CXR Telcom Corporation, a California Corporation, as
Tenant ("Tenant") covering the premises located at 00000 Xxxxxxx Xxxxxxxxx,
Xxxxxxx, Xxxxxxxxxx. This Guaranty shall include any liability Tenant shall
acquire under the Lease for any period following the term of the Lease.
The obligation of the Guarantor is primary and independent of Tenant's
obligations under the Lease and may be enforced directly against the Guarantor
independently of and without proceeding against the Tenant or exhausting or
pursuing any remedy against Tenant or any other person or entity.
This instrument may not be changed, modified, discharged, or terminated
orally or in any manner other than by an agreement in writing signed by
Guarantor and the Landlord.
The obligations of Guarantor under this Guaranty shall not be released or
otherwise affected by reason of any sublease, assignment, or other transfer of
the Tenant's interest under the Lease, whether or not Landlord consents to such
sublease, assignment, or other transfer.
The obligations of Guarantor hereunder shall not be released by Landlord's
receipt, application, or release of security given for the performance and
observance of covenants and conditions in said Lease contained on Tenant's part
to be performed or observed nor by any modification of said Lease; but in case
of any such modification the liability of Guarantor shall be determined in
accordance with the terms of any such modification of the Lease.
Guarantor waives any defense or right arising by reason of any disability
or lack of authority or power of Tenant and shall remain liable hereunder if
Tenant or any other party shall not be liable under the Lease for such reason.
Until all the covenants and conditions in said Lease on Tenant's part to
be performed and observed are fully affirmed and observed, Guarantor (i) shall
have no right of authorities against Tenant by reason of any payments or
preformed and observed by the Guarantor, in compliance with the obligations of
the Guarantor hereunder; (ii) waives any right to enforce any remedy which
Guarantor now or hereunder shall have against Tenant by reason of any one or
more payments or acts of performance in compliance with the obligations of
Guarantor hereunder: and (iii) subordinates any liability or indebtedness of
Tenant now or hereafter held by Guarantor to the obligations of Tenant to the
Landlord under said Lease.
The liability of Guarantor hereunder shall not be released or otherwise
affected by (i) the release or discharge of Tenant in any insolvency,
bankruptcy, reorganization, receivership, or other debtor relief proceeding
involving Tenant (collectively "proceeding for relief"); (ii) the impairment,
limitation, or modification of the liability of Tenant or the estate of the
Tenant in any proceeding for relief, or of any law referring to bankruptcy,
insolvency, or of any remedy for the enforcement of Tenant's liability under the
Lease, resulting from the operation of any law pertaining to bankruptcy,
insolvency, or similar proceeding or other law or from the decision in any
court; (iii) the rejection or disaffirmation of the Lease in any proceeding for
relief; or (iv) the cessation from any cause whatsoever of the liability of
Tenant.
This Guaranty shall continue to be effective or be rescinded, as the case
may be, if at any time any payment by Tenant to Landlord under the Lease is
rescinded or must otherwise be returned by Landlord and its successors and
assigns, and is and shall be binding upon Guarantor and its successors and
assigns, but Guarantor may not assign its obligations hereunder.
GUARANTOR AND LANDLORD WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN
RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE, BETWEEN
LANDLORD AND GUARANTOR ARISING OUT OF THIS GUARANTY OR ANY OTHER DOCUMENT OR
INSTRUMENT EXECUTED IN CONNECTION HEREWITH OR ANY TRANSACTION RELATED TO THE
GUARANTY.
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Guarantor agrees to pay all costs and expenses, including reasonable
attorneys fees, incurred by Landlord in enforcing the terms of this Guaranty.
This Guaranty shall be governed by and constructed in accordance with the
internal laws of the State which governs the Lease excluding any principals of
conflicts of laws. For the purpose solely of litigating any dispute under this
Guaranty, the undersigned submits to the jurisdiction of the courts of said
state.
If the Guarantor is more than one person or entity, the liability of each
such Guarantor shall be joint and several.
WITNESS THE EXECUTION hereof this 28th day of July, 1997.
GUARANTOR:
MicroTel International, Inc.
By: /s/ Xxxxxxx X. Xxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxx
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Title: President and Chief Executive Officer
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