EXHIBIT 10.18
INDUSTRIAL BUILDING LEASE
THIS INDUSTRIAL BUILDING LEASE ("Lease") is made and entered into this
3rd day of June, 1998, by and between MATHILDA DEVELOPMENT, a California
Limited Partnership, hereinafter called "Lessor", and POWER INTEGRATIONS,
INC., a Delaware corporation, hereinafter called "Lessee".
W I T N E S S E T H
WHEREAS, Lessor is the owner of the property commonly described as 000
Xxxxx Xxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxx Xxxxxx, Xxxxxxxxxx ("the
Premises") which has been improved with a building, parking lot, driveway, and
sidewalks, among other things;
WHEREAS, Lessee currently occupies the Premises pursuant to a sublease
dated June 15, 1995 between Lessee, as Sublessee and Intermedics, Inc. as
Sublessor (the "Sublease") which Sublease is subject and subordinate to a
lease dated October 28, 1982, as amended, between Intermedics, Inc., now known
as Sulzer Medica, Inc., ("Intermedics") as lessee and Lessor (the "Master
Lease");
WHEREAS, the Master Lease mentioned above expires on October 31, 1998 and
Lessee desires to lease the Premises directly from Lessor on expiration of the
Master Lease provided that the Sublease has not been terminated for any reason
prior to the commencement of the term of this Lease;
NOW, THEREFORE, it is mutually agreed by and between the parties hereto
as follows:
1. Premises. Lessor hereby leases to Lessee, and Lessee hereby hires
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from Lessor, on the terms and conditions hereinafter set forth, the Premises,
more particularly described in Exhibit "A", attached hereto, and incorporated
herein by this reference.
2. Term.
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(a) Provided that the Sublease has not been terminated for any reason
prior to the commencement of the term of this Lease, the term of this Lease
shall be for a period of five (5) years commencing on the first day of
November, 1998 and ending at midnight on the 31st day of October, 2003. A
termination of the Master Lease due to the default of Intermedics thereunder,
followed by the mutual attornment of Lessor (as Master Lessor under the Master
Lease) and Lessee (as Sublessee under the Sublease), shall
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not be deemed a termination of the Sublease under the provisions of the
preceding sentence.
(b) Holding over after the expiration of the term or extended term, of
this Lease, if any, or any oral extension thereof, with the consent of Lessor,
shall be a tenancy from month to month, and the rentals and additional rentals
upon the covenants, conditions, limitations, and agreements are subject to the
exceptions and reservations contained in this Lease. The rental rate is to be
the same rate last charged hereunder.
If Lessee remains in possession without Lessor's consent after termination
of the Lease, by lapse of time or otherwise, Lessee shall pay Lessor for each
day of such retention one-twentieth (1/20th) of the amount of the monthly
rental for the last month prior to such termination and Lessee shall also pay
all costs, expenses and damages sustained by Lessor by reason of such
retention, including, without limitation, claims made by a succeeding tenant
resulting from Lessee's failure to surrender the Premises.
3. Rental.
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(a) Lessee agrees to pay to Lessor as monthly base rent for the Premises
the following amounts:
Period Monthly Base Rent
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Nov. 1, 1998-Oct. 31, 1999 $60,000.00
Nov. 1, 1999-Oct. 31, 2000 $61,500.00
Nov. 1, 2000-Oct. 31, 2001 $63,000.00
Nov. 1, 2000-Oct. 31, 2002 $64,500.00
Nov. 1, 2002-Oct. 31, 2003 $66,000.00
(b) All rentals, and additional rentals, due Lessor shall be timely
paid, free from all claims and demands against Lessor of any kind, nature or
description whatsoever, and without deduction or offset, at such place or
places as may be designated from time to time by Lessor. If the Lease term
commenced other than on the first day of a calendar month, the first and last
month's rental shall be prorated accordingly.
(c) Lessee agrees that all Monthly Base Rent and additional rentals not
received by Lessor within five (5) calendar days of the due date shall be
considered delinquent and agrees to pay a late charge equal to ten percent
(10%) of the delinquent payment within five (5) business days after receipt of
written notice of non
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receipt of payment. Rent mailed and bearing a U. S. Postal Service postmark of
the date that is two (2) calendar days prior to the due date shall not be
considered delinquent no matter when received. Additionally, any delinquent
payments not paid within thirty (30) days of the original due date shall bear
interest at the lower of the maximum rate then allowed by law or two points
over the reference rate (prime rate) charged by the San Francisco Main Branch
of the Bank of America.
4. Security Deposit. Lessee shall deposit with Lessor Sixty
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Thousand Dollars ($60,000.00) as security for the full and faithful
performance of each and every term, provision, covenant and condition of this
Lease on execution of this Lease and Lessor's execution of this Lease shall
constitute an acknowledgment of receipt of same. In the event Lessee defaults
in respect of any of the terms, provisions, covenants, or conditions of this
Lease, including, but not limited to the payment of rent, Lessor may use,
apply or retain the whole or any part of such security for the payment of any
rent in default or for any other sum which Lessor may spend or be required to
spend by reason of Lessee's default. Should Lessee faithfully and fully comply
with all of the terms, provisions, covenants and conditions of this Lease, the
security or any balance thereof shall be returned to Lessee or, at the option
of Lessor, to the last sublessee of Lessee's interest in this Lease at the
expiration of the term hereof. Lessee shall not be entitled to any interest on
said security deposit.
5. Possession. Lessee is currently in possession of the Premises,
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pursuant to the Sublease.
6. Improvements. Lessee, being in possession of the Premises, accepts
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the Premises and the improvements in their present condition, subject to
Lessor's obligation to repair any latent defects in the Premises at its sole
cost and expense, as provided in paragraph 12, below.
7. Purpose. Lessee agrees to use and occupy the Premises during the
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term hereof for the purpose of light manufacturing and related offices for
engineering, design and related needs, and for no other purpose.
8. Uses Prohibited. Lessee shall not commit or suffer to be committed
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any waste or nuisance upon the said Premises nor shall it in any way violate
any law, ordinance, rule or regulation
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affecting the occupancy or use of the Premises which is, or may hereafter be,
enacted or promulgated by governmental authorities; nor shall it allow the
Premises to be used for any improper, immoral or unlawful purpose; nor shall
it place any materials in the drainage system which are damaging or loads upon
the floor, walls, or ceiling which exceed the limits established in the
original design of the building. No waste material or refuse shall be dumped
upon or permitted to remain upon any part of the Premises outside of the areas
designated for such purposes. No materials, supplies, equipment, finished
product or semi-finished project, nor materials or articles of any nature
shall be put upon or permitted to remain upon any portion of the Premises
outside of the areas designated for such purpose or the building proper.
9. Acceptance of Premises and Covenant to Surrender. Lessee, being in
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possession of the Premises, accepts the Premises as being in good and sanitary
order, condition and repair, and accepts the building and other improvements
in their present condition, subject to Lessor's obligation to repair any
latent defects in the Premises at its whole cost and expense, as provided in
paragraph 12, below.
On the last day of the term hereof or on the sooner termination of the
Lease, Lessee agrees to surrender said Premises unto Lessor in good condition
and repair, reasonable wear and tear excepted, except as otherwise provided
herein. The Lessee also agrees to surrender to Lessor all alterations,
additions, or improvements which may have been made in, to or on the Premises
by Lessee, except as otherwise provided in this Lease. Lessee, on or before
the end of the term or sooner termination of this Lease, shall remove all its
personal property and trade fixtures from the Premises, and all property not
so removed shall be deemed to be abandoned by Lessee. Any property so
abandoned shall be removed by Lessee from the Premises, at Lessor's option,
within five days of Lessor's request, or, should Lessee fail to remove same,
Lessee shall pay Lessor for the actual costs expended by Lessor in removing
the property. If the Premises be not surrendered at the end of the term or
sooner termination of this Lease, Lessee shall indemnify Lessor against loss
or liability resulting from delay by Lessee in so surrendering the Premises,
including, without limitation, any claims made by any succeeding tenant
founded on
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such delay.
10. Quiet Enjoyment by Lessee. Lessor covenants and warrants that upon
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Lessee's paying the rent and observing and performing all of the terms,
covenants and conditions on Lessee's part to be observed and performed
hereunder, Lessee shall and may peaceably and quietly enjoy the Premises
hereby demised, subject, nevertheless, to the terms and conditions of this
Lease.
11. Alterations and Additions. Excepting only non structural
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alterations not exceeding Ten Thousand Dollars ($10,000.00) in cost for any
item of work, Lessee shall not make, or suffer to be made, any alteration or
addition to said Premises, or any part thereof, without the written consent of
Lessor first had and obtained by Lessee, which consent shall not be
unreasonably withheld. Any addition or alteration to the said Premises,
except movable furniture and trade fixtures, shall become, at the option of
Lessor, a part of the realty and belong to the Lessor. Alterations and
additions which are not to be deemed as trade fixtures shall include heating,
lighting, electrical systems, air conditioning, partitioning (except as stated
below), carpeting, or any other installation which has become an integral part
of the leased Premises. Notwithstanding the above, Lessor agrees that
additions and alterations installed by Lessee which do not become an integral
part of the leased Premises, such as, but not limited to, portable metal
partitioning shall be considered movable furniture or trade fixtures and shall
remain the property of the Lessee. Lessee agrees not to proceed to make such
alterations or additions, after having obtained consent from Lessor to do so,
until two days from the receipt of such consent, in order that Lessor may post
appropriate notices to avoid liability to contractors or material suppliers
for payment of Lessee's improvements. Lessee will at all times permit such
notices to be posted and to remain posted until the completion of the work.
12. Maintenance of Premises. Except for latent structural defects,
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which Lessor shall repair at its sole expense, Lessee shall, at its sole
expense, keep and maintain said Premises and appurtenances and every part
thereof, including but not limited to, roof, walls, glazing, sidewalks,
parking areas, landscape areas, plumbing, electrical systems, heating and air
conditioning installations, and the exterior and interior of the Premises in
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good and sanitary order, condition, and repair, and Lessee shall be
responsible for any loss or damages resulting from the negligence or willful
misconduct of the Lessee, its agents, employees or contractors. Lessee agrees
to water, maintain and replace, when necessary, any shrubbery and landscaping
provided by Lessor on the leased Premises; provided, that Lessee's said
obligation shall be appropriately limited and reduced in the event of any
shortage or reduced availability of water. Lessee hereby waives all rights to
make repairs at the expense of Lessor as provided in Section 1942 of the Civil
Code of the State of California, and waives all rights provided by Section
1941 of said Civil Code
13. Abandonment. Lessee shall not vacate or abandon the Premises at any
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time during the term; and if Lessee shall abandon, vacate or surrender said
Premises, or be dispossessed by process of law, any personal property
belonging to Lessee and left on the Premises shall be deemed to be abandoned,
at the option of the Lessor.
14. Freedom from Liens. Lessee shall not create or permit to the
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created or to remain, and covenants to remove and discharge promptly, at its
cost and expense, all liens, claims, stop notices, encumbrances and charges
upon the Premises or Lessee's leasehold interest therein which arise out of
the use or occupancy of the Premises by Lessee or anyone using or occupying
the Premises with the consent or sufferance of Lessee, or by reason of labor
or materials furnished or claimed to have been furnished to Lessee for any
construction, alteration, addition or repair of any part of the Premises.
Lessee shall give Lessor ten (10) days notice prior to commencing any work on
the Premises, so that Lessor shall have reasonable time within which to post
notices of non responsibility.
15. Advertisements and Signs. Lessee may place or permit to be placed,
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in, upon, or about the Premises any signs, advertisements, or notices that
Lessee shall determine appropriate, subject to compliance with the laws and
regulations of the applicable city or other governmental authority. Any signs
so placed on the Premises shall be placed upon the understanding and agreement
that Lessee will remove same upon termination of its tenancy herein created,
and shall repair any damage or injury to the Premises caused thereby. Any
such sign affecting the structural integrity of the building shall be erected
only upon
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receiving Lessor's consent, which consent shall not be unreasonably withheld.
16. Entry by Lessor. Upon prior written notice, Lessee shall permit
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Lessor and his agents to enter into and upon said Premises, at such times as
Lessor and Lessee mutually agree, for the purpose of inspecting the same or
for the purpose of maintaining the Premises, including the erection and
maintenance of such scaffolding, canopies, fences and props as may be required
without any rebate of rent and without any liability to Lessee for any loss of
occupation or quiet enjoyment of the Premises thereby occasioned, provided,
that Lessor shall act so as to avoid any unnecessary interference with
Lessee's business operations. Lessee shall permit Lessor and his agents, at
any time within ninety (90) days prior to the expiration of this Lease, to
place upon said Premises any usual or ordinary "For Sale" or "For Rent" signs
and exhibit the Premises to prospective tenants at reasonable hours. Lessee
shall not unreasonably refuse to agree to permit Lessor or its agents to enter
the Premises for the purposes stated herein.
17. Assignment and Subletting.
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(a) Lessee shall not assign this Lease, or any interest therein, and
shall not sublet the said Premises or any part thereof, or any right or
privilege appurtenant thereto, or suffer any other person (the agents and
servants of Lessee excepted) to occupy or use the said Premises, or any
portion thereof, without the written consent of Lessor first had and obtained,
which consent shall not be unreasonably withheld. Without in any way limiting
Lessor's right to refuse to give consent to a proposed assignment or
subletting under this Paragraph 17, Lessor's refusal to give consent shall not
be deemed unreasonably withheld if:
(i) The character, reputation and financial responsibility of the
proposed new tenant or sub-tenant is not reasonably satisfactory in Lessor's
judgment, or in any event, not at least equal to those possessed by Lessee or
represented to be possessed by Lessee as of the date of the execution of this
Lease. In connection with any such assignment or subletting Lessee shall
deliver to Lessor certified financial statements of Lessee and the new
proposed tenant or sub-tenant showing their then financial condition as
required hereunder.
(ii) The proposed new tenant or sub-tenant fails to
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agree in writing to assume and be bound by all the terms and provisions
of this Lease.
(iii) The proposed new tenant's or sub-tenant's proposed use is
different from that set forth in Paragraph 7.
Additionally, as a condition to Lessor's consent to an assignment or
subletting it is hereby agreed that there shall be paid to Lessor the
following: To the extent any rental or other payments under such sublease or
assignment exceed the Monthly Base Rent payments and additional rental
payments payable under the terms of this Lease plus the assignment or
subleasing commissions, and other costs of assigning or subleasing, all
amortized over the initial term of the sublease or remainder of the lease
term, all of such excess (the total of such excess is referred to herein as
"Excess Payments") shall be paid to Lessor as such Excess Payments become due
and payable under the terms of the assignment or subletting.
If Lessee hereunder is a corporation or at any time becomes a corporation
which, under the then current laws of the State of California, is not deemed a
public corporation, or is an unincorporated association or partnership, the
transfer, or assignment directly or indirectly (except to a member of the
transferor's immediate family by gift, bequest or intestate succession) of
any stock or interest in such corporation, association or partnership in the
aggregate in excess of forty-nine percent (49%) during the term hereof shall
be deemed an assignment within the meaning and provisions of this Paragraph
17. Lessee shall immediately report in writing any such transfer or
assignment of any stock or interest to Lessor.
A consent to one assignment, subletting, occupation or use by any other
person, shall not be deemed to be a consent to any subsequent assignment,
subletting, occupation or use by another person. Any such assignment or
subletting without such consent shall be void, and shall, at the option of the
Lessor, terminate this Lease.
Notwithstanding the above, Lessor's consent shall not be required for an
assignment to: (1) a joint venture if Lessee has at least a fifty percent
(50%) interest in the capital, profits and losses of the joint venture; (2) a
corporation with which Lessee may merge or consolidate; (3) any parent or
subsidiary of Lessee or
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subsidiary of Lessee's parent; (4) a purchaser of substantially all of
Lessee's assets if the assignee executes an agreement reasonably required by
Lessor assuming Lessee's obligations; or (5) the surviving entity resulting
from a corporate reorganization.
This Lease shall not, nor shall any interest therein, be assignable, as to
the interest of the Lessee, by operation of law, or otherwise, without the
written consent of Lessor. Lessee shall not encumber this Lease without
Lessor's consent, which consent may be withheld by Lessor in its sole and
absolute discretion.
(b) In the event Lessee desires to assign this Lease or sublet the
Premises or any part thereof, or suffer any other person to occupy or use the
said Premises, or any portion thereof, Lessee shall so notify Lessor in
writing, and shall disclose to Lessor the identity of the proposed sublessee,
the use which the proposed sublessee intends to make of the Premises and
provide the financial statements described in subparagraph 17 (a) (ii) above,
if Lessor's consent is required. Lessor shall, within fifteen (15) days after
such notice and information is given, notify Lessee in writing whether or not
Lessor consents to such sublease; failure of Lessor to so respond shall be
deemed consent. In the event Lessor shall so consent to sublease, Lessee
shall remain liable for the performance by the sublessee of the terms of this
Lease, unless released from such liability by Lessor in writing. In the event
Lessor reasonably elects not to consent to such subletting, then Lessee shall
continue as lessee under all of the terms of this Lease.
(c) Notwithstanding any other provisions contained in this Lease, in the
event Lessee desires to assign this Lease or sublet the entire Premises at a
rate higher than the then current rent, Lessor shall have the right,
exercisable in Lessor's sole discretion, by written notice to Lessee within
fifteen (15) after receipt of Lessee's written notice and the information
described in subparagraph 17 (b) above, to terminate this Lease as of the date
Lessee proposed to have its assignment or subletting be effective and enter
into a new lease with a third party, including, but not limited to, Lessee's
proposed assignee or subtenant, without any liability to Lessee. On such
termination, this Lease shall be null and void as of the termination date set
forth in Lessor's notice or as of the date Lessee actually surrenders
possession of the
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Premises to Landlord, whichever is later; provided however, each party shall
be liable to the other for any liabilities accrued up to the later of the
above dates.
18. Surrender of Lease. The voluntary or other surrender of this Lease
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by Lessee, or a mutual cancellation thereof, shall not work a merger, and
shall, at the option of Lessor, operate as an assignment to him of any or all
subleases or subtenancies.
19. Security. Nothing herein provided, and no security or guaranty
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which may now or hereafter be furnished Lessor for the payment of the rent
herein reserved, or for the performance by Lessee of the other agreements in
this Lease contained, shall in any way constitute a bar or defense to any
action in unlawful detainer or for the recovery of the Premises which Lessor
may commence for breach of any agreement, term or condition of this Lease.
20. Transfer of Security. Any security given by Lessee at any time to
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secure the faithful performance of all or any of the covenants of this Lease
on the part of Lessee may be transferred and/or delivered by Lessor only upon
the same terms and conditions as set forth in this Lease, to the purchaser of
the Premises in the event that the Premises be sold, and thereupon Lessor
shall be discharged from any further liability in reference thereto.
21. Eminent Domain.
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(a) If the whole of the Premises shall be taken or condemned by any
competent authority for any public or quasi-public use or purpose, then the
term of this Lease shall automatically end upon the date when the possession
so taken shall be required for such use or purpose, and current rent and taxes
shall be apportioned as of the date of such termination.
(b) If only part of the Premises shall be so taken and a part thereof
remains which is reasonably susceptible for occupation by Lessee hereunder for
the purposes for which Lessee has entered into this Lease, this Lease shall,
as to the part so taken, terminate as of the date when the possession so taken
shall be required, and the rent and all other sums payable by Lessee on
account of the Premises hereunder, shall be adjusted so that the Lessee shall
be required to pay for the remainder of the term only such fraction of the
basic rental as the area of the part of the improvements remaining after such
taking bears to the original area
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of the entire improvements prior to such taking. If, after the taking of a
portion of the Premises, there does not remain a portion reasonably
susceptible for Lessee's occupation hereunder, this Lease shall thereupon
automatically terminate in the manner as if the whole Premises had been taken.
Whether all or part of the Premises be taken, all compensation awarded upon
such taking with respect to the real property and improvements shall go to the
Lessor, and the Lessee shall have no claim thereto, nor shall Lessee have
claim against Lessor for any loss, damage, or for any other reason alleged to
result therefrom, provided, however, that Lessee shall in no event be
precluded hereby from perfecting its own claim against the authority or taker
for damages for the taking of its leasehold interest, personal property,
fixtures, or expenses incurred in, or as a result of, any eminent domain
action.
22. Recordation. Neither party shall record this Lease or a short form
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memorandum of this Lease.
23. Subordination. At Lessor's option, this Lease shall be subordinated
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to any mortgage or deed of trust which is now or shall hereafter be placed
upon the Premises, and Lessee agrees to execute and deliver any instrument,
releases or other documents, without cost to it, which may be deemed necessary
to further effect the subordination of this Lease to any such mortgage or deed
of trust; provided that the mortgagee or beneficiary under such deed of trust,
prior to the commencement of the lease term or at the time such subordination
is requested, shall deliver to Lessee a written undertaking on its behalf and
on behalf of its successors and assigns to permit Lessee to occupy the
Premises under the terms of this Lease so long as Lessee is not in default if
there shall be a foreclosure or sale under such mortgage a deed of trust, or
conveyance in lieu of foreclosure or similar transfer, which undertaking shall
be binding upon any subsequent assignee or transferee of such parties.
Failure of Lessee to execute any such instruments, releases or documents shall
constitute a default hereunder.
24. Effect of Conveyance. The term "Lessor" as used in this Lease,
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means only the owner for the time being of the Premises, so that, in the event
of any sale of the Premises, the Lessor shall be and hereby is entirely freed
and relieved of all covenants and obligations of the Lessor hereunder
thereafter accruing. If any
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security be given by the Lessee to secure the faithful performance of all or
any of the covenants of this Lease on the part of Lessee, the Lessor may
transfer and deliver the security, as such, to the purchaser at any such sale,
and thereupon the Lessor shall be discharged from any further liability in
reference thereto.
25. Estoppel Certificate. Lessee shall, at any time and from time to
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time, upon not less than ten (10) days prior to request by Lessor, execute,
acknowledge and deliver to Lessor a statement certifying the date of
commencement of this Lease, that the Lease is unmodified and in full force and
effect (or if there have been any modifications, that the Lease is in full
force and effect, as modified, and stating the date of the modifications), and
further stating the dates to which the rental has been paid, and setting forth
such other matters as may reasonably be required by the Lessor. Lessor and
Lessee intend that any such statement delivered pursuant to this paragraph may
be relied upon by any mortgagee or beneficiary of a deed of trust or by any
prospective purchaser of the Premises.
26. Waiver. The waiver by Lessor or Lessee of any breach of any term,
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covenant or condition, herein contained shall not be deemed to be a waiver of
such term, covenant or condition or any subsequent breach of the same or any
other term, covenant or condition thereon contained. The subsequent
acceptance of rent hereunder by Lessor shall not be deemed to be a waiver of
any preceding breach by Lessee of any term, covenant or condition of this
Lease, other than the failure of Lessee to pay the particular rental so
accepted, regardless of Lessor's knowledge of such preceding breach at the
time of acceptance of such rent.
27. Attorney's Fees. In case suit should be brought for the possession
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of the Premises, for the recovery of any sum due hereunder, or because of the
breach of any other covenant herein, the losing party shall pay to the
prevailing party reasonable attorney's fees and other expenses incurred in the
litigation, which shall be deemed to have accrued on the commencement of such
action and shall be enforceable whether or not such action is prosecuted to
judgment.
28. Default. Occurrence of any of the following events shall constitute
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a default and breach of this Lease by Lessee.
(a) The vacating and abandonment of the Premises by Lessee.
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(b) The failure by Lessee to make any payment of rent or any other
payment required of Lessee hereunder, as and when due, if such failure
continues for three (3) days after written notice thereof by Lessor to Lessee.
(c) The failure by Lessee to observe or perform any of the covenants,
conditions or provisions of this Lease other than described in subparagraph
28(b) above, where such failure continues for thirty (30) days after written
notice thereof by Lessor to Lessee; provided however, that if Lessee's default
is such that more than thirty (30) days are reasonably required for its cure,
then Lessee shall not be deemed to be in default if Lessee commences such cure
within said thirty (30) day period and thereafter diligently prosecutes such
cure to completion.
(d) The making by Lessee of any general assignment or general
arrangement for the benefit of creditors or the filing by or against Lessee of
a petition to have Lessee adjudged bankrupt, or a petition, or reorganization
or arrangement under any law relating to bankruptcy (unless in the case of a
petition filed against Lessee, the same is dismissed within sixty (60) days);
or the appointment of a trustee or a receiver to take possession of
substantially all of Lessee's assets located at the Premises or of Lessee's
interest in this Lease, where possession is not restored to Lessee within
thirty (30) days; or the attachment, execution or other judicial seizure of
substantially all of Lessee's assets located at the Premises or of Lessee's
interest in this Lease, where such seizure is not discharged in thirty (30)
days.
(e) Any two (2) failures by Lessee to observe or perform any provision or
provisions of this Lease (whether such provision be the same or different)
after written notice by Lessor of such failure during any twelve (12) month
period of the term, as such may be extended, at the option of Lessor shall
constitute a separate and non-curable default.
29. Remedies. Lessor shall have the following remedies if Lessee
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commits a default. These remedies are not exclusive; they are cumulative and
in addition to any remedies now or later allowed by law.
(a) Lessor may continue this Lease in full force and effect, as long as
Lessor does not terminate Lessee's right to possession, and Lessor shall have
the right to collect rent when due. During
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the period Lessee is in default, Lessor may enter the Premises and relet them,
or any part of them, to third parties for Lessee's account. Lessee shall be
liable to Lessor for all costs Lessor incurs in reletting the Premises,
including, without limitation, broker's commissions and expenses of remodeling
the Premises required by the reletting. Reletting may be for a period shorter
or longer than the remaining term of the Lease. Lessee shall pay to Lessor the
rent due under this Lease as and when due, less the rent Lessor receives from
any reletting. No act by Lessor allowed by this Paragraph shall terminate this
Lease unless Lessor notifies Lessee in writing that Lessor elects to terminate
Lessee's right to possession of the Premises. If Lessee obtains Lessor's
consent, Lessee shall have the right to assign or sublet its interest in this
Lease, but Lessee shall not be released from liability. Lessor's consent to a
proposed assignment or subletting shall not be unreasonably withheld.
(b) Lessor may terminate Lessee's right to possession of the Premises at
any time. No act by Lessor other than giving written notice to Lessee shall
terminate this Lease. Acts of maintenance, efforts to relet the Premises, or
the appointment of a receiver on Lessor's initiative to protect Landlord's
interest under this Lease shall not constitute a termination of Lessee's right
to possession. On termination, Lessor has the right to recover from Lessee:
(i) The worth at the time of the award of the unpaid rent that had
been earned at the time of termination of this Lease;
(ii) The worth at the time of the award of the amount by which the
unpaid rent that would have been earned after the date of termination of this
Lease until the time of award exceeds the amount of the loss of rent that
Lessee proves could have been reasonably avoided;
(iii) The worth at the time of the award of the amount by which the
unpaid rent for the balance of the term after the time of award exceeds the
amount of the loss of rent that Lessee proves could have been reasonably
avoided; and
(iv) Any other amount, and court costs, necessary to compensate
Lessor for all detriment proximately caused by Lessee's default.
"The worth, at the time of the award", as used in (i) and (ii)
14
of this subparagraph, is to be computed by allowing interest at the
maximum rate allowed by law. "The worth, at the time of the award", as
referred to in (iii) of this subparagraph, is to be computed by
discounting the amount at the discount rate of the Federal Reserve Bank of
San Francisco at the time of the award, plus one percent (1%).
30. Taxes. Lessee shall be liable for and shall promptly pay to Lessor,
-----
as additional rental during the term of this Lease, all taxes, levies, fees,
water or sewer rents and charges, special assessments, and other governmental
charge of every character (herein collectively called "taxes"), against the
Premises during the term hereof. Such taxes shall be prorated between the
parties hereto for the first and last year of the lease term. Lessee may pay
any such taxes in installments if payment may be so made without penalty.
Lessee shall pay for all taxes levied against Lessee's fixtures, equipment and
personal property situated on the leased Premises, and all additions and
leasehold improvements made, added or installed by Lessee, whether such
fixtures, equipment, personal property, additions or leasehold improvements
are assessed as real or personal property. Lessor shall notify Lessee, at
least thirty (30) days prior to the due date, of the time on which property
taxes shall be due and payable to the taking authorities, and shall provide
Lessee with a copy of the tax bills related to the Premises. Lessee shall pay
to Lessor the total amount of such taxes not less than fifteen (15) days prior
to the date such shall be delinquent. Lessee may contest the amount or
validity of any taxes by appropriate proceeding. However, Lessee shall
promptly pay such taxes unless such proceeding shall operate to prevent or
stay the collection of the tax so contested. Lessor, at Lessee's sole
expense, shall join in any such proceeding if any law shall so require.
31. Destruction of Premises.
-----------------------
(a) If ten percent (10%) or less of the improvements to the Premises are
damaged by an uninsured peril, Lessor shall promptly and diligently proceed to
repair and restore the same to substantially the same condition as existed
prior to such damage or destruction; provided, however, that should such
damage be caused by the act, negligence of fault or omission of any duty with
respect to the same by Lessee, its agents, servants, employees or
15
invitees, Lessee and not Lessor shall be so obligated to repair and restore.
If the improvements to the Premises are damaged by an uninsured peril
rendering more than ten percent (10%) of the improvements to the Premises
unusable for the conduct of Lessee's business, Lessor may upon written notice,
given to Lessee within thirty (30) days after the occurrence of such damage,
elect to terminate this Lease; provided, however, Lessee may, within thirty
(30) days after receipt of such notice, elect to make any required repairs
and/or restoration, in which event this Lease shall remain in full force and
effect, and Lessee shall thereafter diligently proceed with such repairs
and/or restoration. During any such repairs or restoration, rent and all other
amounts to be paid by Lessee on account of the Premises shall xxxxx in
proportion to the area of the improvements to the Premises rendered not
reasonably suitable for the conduct of Lessee's business.
(b) If the improvements to the Premises are damaged or destroyed by fire
or other insured peril, Lessor shall promptly and diligently proceed to repair
and restore the same to substantially the same condition as existed prior to
such damage or destruction; provided, however, that Lessor shall not be
obligated to repair and restore until either the insurer acknowledges that the
loss is covered by insurance and sufficient proceeds of such insurance are
made available to Lessor to pay the costs or the Lessee agrees to pay such
costs to Lessor. If the existing laws do not permit the restoration, either
party can terminate this Lease immediately by giving notice to the other
party.
If the cost of restoration exceeds the amount of proceeds received from
the insurance required under Paragraph 34, and Lessee has not agreed to pay
the excess cost of repairs and/or restoration to Lessor, Lessor can elect to
terminate this Lease by giving notice to Lessee within fifteen (15) days after
determining that the restoration cost will exceed the insurance proceeds. In
the case of destruction to the Premises, if Lessor elects to terminate this
Lease, Lessee, within thirty (30) days after receiving Lessor's notice to
terminate, can agree to pay to Lessor the difference between the amount of
insurance proceeds and the cost of restoration in which case Lessor shall
restore the Premises. Lessor shall give Lessee satisfactory evidence that all
sums contributed by Lessee as provided in this paragraph have been
16
expended by Lessor in paying the cost of restoration.
If Lessor elects to terminate this Lease and Lessee does not elect to
contribute toward the cost of restoration as provided herein, this Lease shall
terminate and all of the proceeds of the insurance shall be paid to Lessor;
provided, however, that in the event such proceeds shall include any amounts
paid for damage to or destruction of property belonging to Lessee, Lessor
shall within ten (10)days of receipt, pay over such amounts to Lessee in the
following manner: Out of the gross proceeds paid by insurance to Lessor,
Lessor shall retain an amount equivalent to the current replacement cost of
the building and improvements owned by Lessor; after Lessor has been so paid
from the insurance proceeds, if there remains a balance of such insurance
proceeds which represent payment for damage to or destruction of improvements
added by Lessee after the date of Lessee's occupancy of the Premises, then, to
the extent of any remaining balance of the insurance proceeds and to the
extent of Lessee's direct costs of making such added improvements, Lessor
shall be obligated to pay over to Lessee such insurance proceeds. During any
such repair or restoration described in this paragraph, rent and any other
amounts to be paid by Lessee on account of the Premises shall xxxxx in
proportion to the area of the Premises rendered unusable by such damage or
destruction; provided, however, that Lessor shall have no liability by reason
of injury to or interference with Lessee's business or property arising from
the making of any repairs, alterations, or improvements in or to any portion
of the Premises or in or to fixtures, appurtenances and equipment therein. If
the Premises are destroyed or substantially damaged within one year of the end
of this Lease term or a renewal period, Lessor or Lessee shall each of the
option to cancel the Lease, and all insurance proceeds on the real property
shall be paid to Lessor; provided, that if an option then exists to extend the
term hereof, and Lessee exercises such option, the parties shall proceed with
repairs and restoration as set forth above and the Lease shall not terminate
except as provided above.
In the event Lessee shall have paid all or a portion of the costs of any
repairs or restorations for which Lessor subsequently receive insurance
proceeds, then to the extent that such insurance proceeds and Lessee's
payments exceed Lessor's cost of repair
17
and/or restoration, Lessor shall reimburse Lessee to the extent of Lessee's
payments.
32. Waiver of Damages and Indemnification of Lessor. Lessor
-----------------------------------------------
shall not be liable to Lessee for any injury or damage that may result to any
person or property by or from any cause whatsoever other than the injuries or
damages caused by the negligence or misconduct of Lessor, its agents,
servants, employees, invitees, or contractors. Without limiting the generality
of the foregoing waiver, it is expressed extended to injury or damage caused
by water or vapor leakage of any character from the roof, walls, pipes or any
other part of the Premises, or caused by gas, oil, electricity, or any other
cause in or about the Premises or the building. Lessee agrees to hold Lessor
harmless for, and to defend Lessor against, any and all claims or liability
for any death of or injury to any person or damage to any property whatsoever,
occurring in, on or about the area or facilities of the building (including
without limiting the generality of the foregoing, elevators, stairways,
passage-ways, hallways, or parking areas) excepting only to the extent that
such death, injury or damage shall be caused by the negligence or misconduct
of the Lessor, its agents, employees or contractors.
33. Waiver of Subrogation. Each of the parties hereto agrees to waive
---------------------
any and all claims against the other party for any loss, to the extent such
loss is repaid by proceeds of insurance maintained by the party that sustained
the loss.
34. Insurance. Lessor shall procure and maintain in force and effect,
---------
during the term of this Lease, policies of insurance covering the building,
improvements, and the Premises as set forth below:
(a) Such policy(ies) shall insure on a "blanket" basis the building value
and all improvements to the Premises installed by the Lessor.
(b) Such insurance shall be written on a "full replacement value basis"
including a replacement cost endorsement and shall also contain a "stipulated
amount clause" or its equivalent.
(c) The insurer and terms of coverage shall be subject to the reasonable
discretion of the Lessor.
(d) As a basis for continuance of the "stipulated amount clause", Lessor
shall adjust such amount annually in accordance
18
with reasonably acceptable industrial building cost indices for the State of
California. Lessee acknowledges that Lessor's mortgage lender may require an
amount to be stipulated at least equal to the amount loaned, and Lessee agrees
that, if so required, such amount is reasonable. Anything in this Lease to the
contrary notwithstanding, the stipulated amount shall not exceed the
replacement value of the building and improvements.
(e) The policy(ies) written to cover the Premises shall name the Lessor
as named insured and any bank or other mortgage lender with an interest in the
Premises shall be included as a loss payee.
(f) Such policy(ies) shall be written so as to insure losses arising
from all risks including, but not limited to, the perils of fire, extended
coverage (including explosion), vandalism and malicious mischief, earthquake
(so long as said coverage is available at commercially reasonable rates),
collapse, liquid damage, and sprinkler leakage coverage which sprinkler
leakage coverage shall be equivalent to at least twenty-five percent (25%) of
replacement value, as determined above.
(g) The policy(ies) required under this Paragraph 34 shall expressly
provide that it (they) shall not be cancelled or altered without thirty (30)
days prior written notice to the Lessee.
(h) Lessee shall reimburse Lessor, as additional rent, all costs and
premiums for all insurance coverage required by this Paragraph 34 within
thirty (30) days after receipt of a copy of the premium notice.
35. Indemnification of Lessor and Lessee's Liability and Personal
-------------------------------------------------------------
Property Insurance.
------------------
(a) Lessee, as a material part of the consideration to be rendered to
Lessor, waives all claims against Lessor for damages to goods, wares and
merchandise, and all other personal property in, upon or about said Premises
and for injuries to persons in or about said Premises, from any cause arising
at any time except to the extent such injuries or damages are caused by the
negligence or willful misconduct of the Lessor, its agents, servants,
employees, invitees, or contractors, and Lessee will hold Lessor exempt and
harmless from any damage or injury to any person or to the goods, wares and
merchandise and all other personal property of any person, arising out of and
in connection with the use or occupancy
19
of the Premises by Lessee, or from the failure of Lessee to keep the Premises
in good condition and repair except to the extent any such injuries or damages
are caused by the negligence or willful misconduct of the Lessor, its agents,
servants, employees, invitees, or contractors. Lessee shall secure and keep in
force a public liability insurance and property damage policy covering the
Premises, including parking areas, insuring the Lessee and naming Lessor
(Lessor's mortgage lender, if required) as additional insured(s) with regard
to Lessee's use or occupancy of the Premises. A copy of the said policy shall
be delivered to Lessor and the minimum limits of coverage thereto shall be not
less than $3,000,000.00 per occurrence for personal injury and for damage to
property. Lessee shall also maintain in force during the term hereof insurance
covering its tenant improvements, fixtures, equipment, merchandise and
personal property in the Premises with a policy or policies of fire insurance
with a standard extended coverage endorsement attached together with coverage
for sprinkler damage, vandalism, and malicious mischief to the extent of their
insurable value, the proceeds of which will, so long as this Lease is in
effect, be used for the repair or replacement of the assets so insured. It is
understood Lessor shall have no interest in the insurance upon Lessee's assets
and will sign all documents necessary or proper in connection with the
settlement of any claim or loss by Lessee.
(b) All policies required to be maintained by Lessee pursuant to the
terms of this Lease shall be issued by companies of recognized financial
standing authorized to do insurance business in California. Lessee shall pay
all the premiums and costs therefor and shall deliver to Lessor annually
copies of or certificates of the insurer that said policies are in effect.
Should Lessee fail to effect, maintain or renew any insurance provided for in
this Lease, or to pay any cost of premium therefor, or to deliver to Lessor
any of such policies or certificates, then in any of said events, Lessor, at
its option, but without obligation to do so, may, upon five (5) days written
notice to Lessee of its intention so to do, procure such insurance and any
sums expended by it to procure any such insurance shall be additional rent
hereunder and shall be repaid by Lessee within five (5) days following the
date on which written notice of such
20
expenditure shall be given by Lessor to Lessee. Lessee shall obtain a written
undertaking from each insurer that cancellation or reduction in coverage of
said policy(ies) cannot be had without notification to Lessor and any loss
payee at least thirty (30) days prior thereto.
36. Utilities and Services. Lessee shall pay for all gas, heat, light,
----------------------
power, telephone or other communication service, janitorial, gardener, and
garbage disposal service and all other utilities and services supplied or
required to be supplied to the Premises.
37. Notices. All notices, consents, waiver or other communications
-------
which this Lease requires to permit either party to give to the other shall be
in writing and shall be served personally or forwarded by registered or
certified mail, return receipt requested, made upon or addressed to the
respective parties as follows:
To Lessor:Mathilda Development
c/o The Cortana Corporation
000 Xx Xxxxxx Xxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000
To Lessee:At Premises
Attention:
or to such other address as may be contained in a notice from either party to
the other given pursuant to this paragraph. Notice by registered or certified
mail shall be deemed to be given forty-eight (48) hours from the time of
postmarking, if mailed within the continental limits of the United States
(excluding Alaska). Rental payments required by this Lease shall be delivered
to Lessor at Lessor's address provided in this paragraph.
38. Marginal Captions. The marginal headings or titles to the
-----------------
paragraphs of this Lease are not a part of this Lease and shall have no effect
upon the construction or interpretation of any part thereof.
39. Miscellaneous.
-------------
(a) All provisions of this Lease shall be deemed and construed to be
"covenants" as though the words importing such covenants were used in each
separate paragraph hereof.
(b) This Lease shall be construed and enforced in accordance with the
laws of the State of California.
21
(c) This Lease and the covenants and agreements herein contained shall
bind and inure to the benefit of the parties hereto, their heirs, successors,
executors, administrators and assigns.
(d) The words "Lessor" and "Lessee" as used herein shall include the
plural as well as the singular. Words used in the neuter include the
masculine and feminine gender. If there be more than one Lessor or Lessee the
obligations hereunder imposed upon Lessor or Lessee shall be joint and
several.
(e) Time is of the essence of the Lease. This Lease and the obligations
of the parties hereunder shall not be affected or diminished because the
Lessor is unable to fulfill any of its obligations hereunder (other than the
payment of money) or is delayed in doing so, unless such inability or delay is
caused by reason of strike or other union-related labor troubles, civil
commotion, invasion, rebellion, hostilities, military or usurped power,
sabotage, governmental regulations or controls, inability to obtain any
material, service or financing, acts of God or by any other cause beyond its
control.
40. Warranty. Lessee warrants to Lessor that Lessee conducts business
--------
as a corporation organized in the State of California, and that said
corporation is fully empowered and legally authorized to execute this
agreement in the State of California. Lessee further warrants to Lessor that
Lessee will provide an appropriate certificate of the Corporation Secretary or
copy of Resolution of the corporate directors establishing the authority of
the officers to execute this document. Lessee agrees to provide Lessor copies
of the published financial statements and reports of the corporation in the
same manner as if Lessor were a shareholder of the common stock of the
corporation.
41. Severability. If any term or provision of this Lease Agreement, or
------------
the application thereof to any person or circumstance, shall, to any extent,
be invalid or unenforceable, the remainder of this Lease Agreement, or the
application of such terms or provisions to persons or circumstances other than
those to which it is invalid or unenforceable, shall not be affected thereby,
and each term and provision of this Lease Agreement shall be valid and
enforceable to the fullest extent permitted by law.
42. Further Instruments. Lessee, at no cost or expense to
-------------------
22
Lessee, shall execute such documents and instruments as Lessor may request as
are reasonably necessary and appropriate for governmental approval of the
subdivision of the Premises from the adjacent property owned by Lessor.
43. Non-Recourse Obligation. All obligations of Lessor hereunder shall
-----------------------
not constitute personal obligations of Lessor, its partners or any other
persons or entities constituting Lessor and Lessee shall not seek recourse
against any such entities, persons, or any of their assets for satisfaction of
any liabilities with respect to this Lease. In the event Lessee obtains a
judgment against Lessor resulting from any default or claim or raising under
this Lease, such judgment may only be satisfied from Lessor's interest in the
real property commonly described as 000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxxxxxx,
Santa Xxxxx, Santa Xxxxx County, California or proceeds from the sale thereof
and no other real, personal, or mixed property of Lessor, its partners, or any
other persons or entities comprising Lessor, wherever situated, shall be
subject to levy to satisfy such judgment.
44. Hazardous Materials Usage and Indemnities. Lessee hereby makes the
-----------------------------------------
following covenants regarding hazardous materials:
(a) Lessee shall at all times and in all material respects comply with
all federal, state and local laws, ordinances and regulations, including, but
not limited to, the Federal Water Pollution Control Act (33 U.S.C. sec.1251,
et seq.), Resource Conservation & Recovery Act (42 U.S.C. sec.6901, et seq.),
------ ------
Safe Drinking Water Act (42 U.S.C. sec.3000f, et seq.), Toxic Substance
------
Control Act (15 U.S.C. sec.2601, et seq.), the Clean Air Act (42 U.S.C.
------
sec.7401, et seq.), Comprehensive Environmental Response, Compensation and
------
Liability Act (42 U.S.C. sec.9601, et seq.), California Health & Safety Code
------
(sec.25100, et seq.; sec.39000, et seq.), California Safe Drinking Water &
Toxic Enforcement Act of 1986 (California Health & Safety Code sec.25249.5, et
--
seq.), California Water Code (sec.13000, et seq.), and other comparable state
--- -- ---
and federal laws ("Hazardous Materials Laws"), relating to the use, analysis,
generation, manufacture, storage, disposal or transportation of any "hazardous
substances," "hazardous wastes," "hazardous materials" or "toxic substances"
as such terms are defined under any Hazardous Materials Laws (collectively,
"Hazardous Materials").
23
(b) Lessee shall, at its own expense, procure, maintain in effect and
comply in all material respects with all conditions of any and all permits,
licenses, and other governmental and regulatory approvals required for
Lessee's use of Hazardous Materials on the Premises, including, without
limitation, discharge of (appropriately treated) materials or wastes into or
through any sanitary sewer serving the Premises. Lessee shall cause any and
all of its Hazardous Materials to be removed from the Premises solely in
compliance with all applicable Hazardous Materials Laws. Lessee shall in all
material respects handle, treat, deal with and manage any and all Hazardous
Materials in, on, under or about the Premises in conformity with all
applicable Hazardous Materials Laws and prudent industry practices regarding
management of such Hazardous Materials. Upon expiration or earlier
termination of the term, Lessee shall cause all of its Hazardous Materials to
be removed from the Premises in accordance with and in compliance with all
applicable Hazardous Materials Laws.
(c) Lessee shall indemnify, defend (by counsel reasonably acceptable to
Lessor), protect, and hold Lessor and each of Lessor's partners, employees,
agents, attorneys, successors and assigns, free and harmless from and against
any and all claims, liabilities, penalties, forfeitures, losses or expenses
(including reasonable attorneys' fees) arising from or caused in whole or in
part, directly or indirectly, by (i) an Environmental Activity (defined below)
by Lessee, or (ii) Lessee's failure to comply with any Hazardous Materials
Law. Lessee's obligations under this paragraph shall include all costs of any
repair, cleanup or detoxification or decontamination of the Premises, or the
preparation and implementation of any closure, remedial action or other plans
in connection therewith that are required as a result of any Environmental
Activity by Lessee.
Lessor shall indemnify, defend (by counsel reasonably acceptable to
Lessee), protect, and hold Lessor and each of Lessee's partners, employees,
agents, attorneys, successors and assigns, free and harmless form and against
any and all claims, liabilities, penalties, forfeitures, losses or expenses
(including reasonable attorneys' fees) arising from or caused in whole or in
part, directly or indirectly, the occurrence of any Environmental Activity
where such Environmental Activity was not caused by
24
Lessee. Lessor's obligations under this paragraph shall include all costs of
any repair, cleanup or detoxification or decontamination of the Premises, or
the preparation and implementation of any closure, remedial action or other
plans in connection therewith that are required as a result of any
Environmental Activity other than an Environmental Activity caused by Lessee.
The provisions of this Paragraph 44 shall survive the termination of the
Lease. "Environmental Activity" means any actual, proposed or threatened
storage, holding, existence, release, emission, discharge, generation,
processing, abatement, removal, disposition, handling or transportation of any
Hazardous Materials from, into or on the Premises, or any other activity or
occurrence that causes or would cause any such event to exist.
45. Option to Extend. (a) In the event Lessee shall not then be in
----------------
default hereunder and shall have made all previous rental payments in a timely
manner (no more than one payment in each calendar year being delinquent, as
defined in Paragraph 3 hereof), Lessee shall have the right, not earlier than
nine (9) months prior to the date of the expiration of the term of this Lease
and not later than six (6) months prior to the date of the expiration of the
term of this Lease, to renew the term of this Lease for a further term of five
(5) years from the date of expiration of the term of this Lease.
(b) Such election shall be made by Lessee by serving upon Lessor a
notice in writing to the effect that Lessee elects to renew and extend the
term of this Lease for such extended term.
(c) In the event Lessee shall elect to renew this Lease and shall
serve notice of such election, upon the expiration of the term of this Lease,
it shall be automatically extended for an additional term of five (5) years
from the date of expiration of the original term of this Lease.
(d) Except for the redetermination of the base rental in accordance
with this Paragraph 45, all other terms and conditions of the original lease
agreement shall apply to the extended term.
(e) (i) During the first year of extended term of this Lease, if
any, Lessee shall pay to Lessor as Monthly Base Rent for the Premises monthly
rent in an amount equal to the then current
25
fair market value of the Premises. Such Monthly Base Rent shall be increased
annually during the extended term in proportion to the increase in the
Consumer Price Index, All Items, San Francisco-Oakland-San Xxxx, All Urban
Consumers, 1982-84=100. The base index shall be the index for August, 2003.
The adjustment index shall be the index for August, 2004. The percentage
increase between those two indexes shall be applied to the Monthly Base Rent
for the first year of the extended term to determine the Monthly Base Rent for
the next year of the extended term. The same procedure shall be used for each
subsequent year of the extended term. In no event, however, shall the Monthly
Base Rent for the first year of the extended term or for any subsequent year
be less than that of the immediately preceding year.
(ii) Lessor and Lessee shall have thirty (30) days after service of
Lessee's notice of election to renew on Lessor to agree on such monthly fair
market rental value of the Premises. If Lessor and Lessee agree on such
amount during such thirty (30) day period, then they shall immediately execute
an amendment to this Lease setting forth the Monthly Base Rent for the first
year of the extended term of this Lease. If Lessor and Lessee are unable to
agree on such amount within such thirty (30) day period, then they shall each,
within thirty (30) days of the expiration of such period, appoint a real
estate broker knowledgeable of the monthly rentals charged for similar
commercial space in the Sunnyvale area and such brokers shall then endeavor to
agree on the monthly fair market rental value of the Premises. If the two
brokers agree on the monthly fair market rental value of the Premises, their
decision shall be binding on the parties. If either party hereto does not
appoint a broker within such second thirty (30) day period, then the single
broker appointed shall be the sole broker and shall establish such amounts
alone.
(iii) If the brokers so appointed are unable to agree on the
monthly fair market rental value of the Premises within thirty (30) days after
the second broker has been appointed, then the two brokers shall attempt to
select a third broker meeting the qualifications set forth above within ten
(10) days after the last day the two brokers are given to establish such
amount. If the two brokers are unable to agree on a third broker, either
party hereto, after giving ten (10) days' notice to the other party, can
26
apply to the then President of the Real Estate Board of Santa Xxxxx County, or
to the presiding judge of the Superior Court of Santa Xxxxx County, for the
selection of a third broker. The three brokers shall then establish the
monthly fair market rental value of the Premises by majority vote. Lessor and
Lessee shall each bear the cost of their own broker and 1/2 of the cost of
appointing the third broker and of the third broker's fee.
46. Entire Agreement. This instrument contains all of the agreements and
----------------
conditions made between the parties hereto and may not be modified orally or
in any other manner than by an agreement in writing signed by all of the
parties hereto or their respective successors in interest.
IN WITNESS WHEREOF, the parties hereto have executed this Lease the day
and year first above written.
"LESSEE"
POWER INTEGRATIONS, INC.,
a California Corporation
By /s/Xxxxxxxx X. Xxxxxx
-----------------------
Xxxxxxxx X. Xxxxxx, Vice President
"LESSOR"
MATHILDA DEVELOPMENT, a
California Limited Partnership
THE CORTANA CORPORATION,
Managing General Partner
By /s/ Xxxxx X. Xxxxxxxxxx
-------------------------
Xxxxx X. Xxxxxxxxxx, President
27
