INDUSTRIAL LEASE
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(Multi-Tenant; Net)
"AS-IS"
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THIS LEASE is made as of the 22nd day of October, 1999, by and between
THE IRVINE COMPANY, hereafter called "Landlord", and NEWGEN RESULTS
CORPORATION, a Delaware corporation, hereinafter called "Tenant."
ARTICLE I. BASIC LEASE PROVISIONS
Each reference in this Lease to the "Basic Lease Provisions" shall mean
and refer to the following collective terms, the application of which shall
be governed by the provisions in the remaining Articles of this Lease.
1. Premises: Suite No. 100 (the Premises are more particularly described in
Section 2.1).
Address of Building: 0000 Xxxxxxx Xxxx Xxxxx, Xxx Xxxxx, XX 00000.
2. Project Description (if applicable): Xxxxxxx Ridge Business Park Phase I.
3. Use of Premises: General office, customer service/call center and related
uses.
4. Commencement Date: December 1, 1999.
5. Lease term: The Term of this Lease shall expire at midnight on
January 31, 2001.
6. Basic Rent: Thirty Seven Thousand One Hundred Seventy Dollars
($37,170.00) per month, based on $.90 per rentable square foot.
7. Guarantor(s): None.
8. Floor Area of Premises: approximately 41,300 rentable square feet.
9. Security Deposit: $40,887.00
10. Broker(s): Colliers International & Xxxxxx Xxxxxx Group.
11. Additional Insureds: Insignia\ESG of California, Inc.
12. Address for Payments and Notices:
LANDLORD TENANT
INSIGNIA\ESG OF CALIFORNIA, INC. NEWGEN RESULTS CORPORATION
1 Ada, Suite 270 00000 Xxxx Xxxxx Xxxxx
Xxxxxx, XX 00000 Xxx Xxxxx, XX 00000
Attention: Xxxxx Xxxxx
with a copy of notices to:
IRVINE INDUSTRIAL COMPANY
X.X. XXX 0000
Xxxxxxx Xxxxx, XX 00000-0000
Attn: Vice President, Industrial Operations
13. Tenant's Liability Insurance Requirement: $2,000,000.00.
14. Vehicle Parking Spaces: Two Hundred Thirty (230), comprising of one
hundred sixty (160) parking spaces located at 0000 Xxxxxxx Xxxx Xxxxx,
and those seventy (70) parking spaces located within the portions of the
Common Areas at 0000 Xxxxxxx Xxxx as shown on EXHIBIT Y attached hereto
at no charge to Tenant.
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ARTICLE II. PREMISES
SECTION 2.1. LEASED PREMISES. Landlord leases to Tenant and Tenant
leases from Landlord the premises shown in EXHIBIT A (the "Premises"),
contained approximately the floor area set forth in Item 8 of the Basic Lease
Provisions ("Floor Area") and known by the suite number identified in Item 1
of the Basic Lease Provisions. The Premises are located in the building
identified in Item 1 of the Basic Lease Provisions (which together with the
underlying real property, is called the "Building"), and is a portion of the
project shown in EXHIBIT Y (the "Project"). The parties agree that the
specified Floor Area shall be the size of the rentable area of the Premises
for all purposes under this Lease notwithstanding any later determination or
remeasurement. Within five (5) days following Landlord's request, the parties
shall memorialize the adjustments by executing an amendment to this Lease
prepared by Landlord, provided that the failure or refusal by either party to
execute the amendment shall not affect its validity.
SECTION 2.2. ACCEPTANCE OF PREMISES. Tenant acknowledges that neither
Landlord nor any representative of Landlord has made any representation or
warranty with respect to the Premises or the Building or the suitability or
fitness of either for any purpose, including, without limitation, any
representations or warranties regarding zoning or other land use matters, and
that neither Landlord nor any representative of Landlord has made any
representations or warranties regarding (i) what other tenants or uses may
be permitted or intended in the Building and the Project, or (ii) any
exclusivity of use by Tenant with respect to its permitted use of the
Premises as set forth in Item 3 of the Basic Lease Provisions. Tenant further
acknowledges that neither Landlord nor any representative of Landlord has
agreed to undertake any alterations or additions to the Premises except as
expressly provided in this Lease. It is further understood that Tenant shall
take possession of the Premises as of the Commencement Date of this Lease in
an "as-is" condition without further obligation on Landlord's part as to
improvements whatsoever.
SECTION 2.3. BUILDING NAME AND ADDRESS. Tenant shall not utilize any name
selected by Landlord from time to time for the Building and/or the Project as
any part of Tenant's corporate or trade name. Landlord shall have the right
to change the name, address, number or designation of the Building or Project
without liability to Tenant.
SECTION 2.4. LANDLORD'S RESPONSIBILITIES. Notwithstanding the provisions
of Section 7.2 of this Lease: (i) the electrical, HVAC, plumbing and
mechanical systems in the Premises shall be in good operating order as of the
Commencement Date and (ii) during the initial 14-month Term of this Lease,
Landlord agrees to repair and/or replace, at its sole cost and expense and
not as a "Project Cost", the structural components of the roof, the
load-bearing walls and the foundations and footings of the Building.
Notwithstanding the foregoing, Landlord's obligation contained in this
Section 2.4 to bear such costs and expenses shall not apply: (i) to the costs
and expenses of periodic maintenance of the roof, walls, foundations and
footings of the Building, nor (ii) to the extent of the negligence or willful
misconduct by Tenant, its employees, agents, contractors, licensees or
invitees (in which case Tenant shall be responsible for the reasonable costs
of such repairs and/or replacements). The repairs or replacements required of
Landlord pursuant to this Section 2.4 shall be made promptly following notice
from Tenant.
ARTICLE III. TERM
SECTION 3.1. GENERAL. The Term shall be for the period shown in Item 5
of the Basic Lease Provisions. The Term shall commence ("Commencement Date")
on the date set forth in Item 4 of the Basic Lease Provisions and shall
expire on the corresponding date (the "Expiration Date") of the expiration of
the Term.
SECTION 3.2. DELAY IN POSSESSION. If Landlord, for any reason whatsoever,
cannot deliver possession of the Premises to Tenant on or before the
Commencement Date, this Lease shall not be void or voidable nor shall
Landlord be liable to Tenant for any resulting loss or damage. However,
Tenant shall not be liable for any rent and the Commencement Date shall not
occur until Landlord delivers possession of the Premises and the Premises are
in fact available for Tenant's occupancy, except that if Landlord's failure
to so deliver possession on the Commencement Date is attributable to any
action or inaction by Tenant, then the Commencement Date shall not be
advanced to the date on which possession of the Premises is tendered to
Tenant, and the Landlord shall be entitled to full performance by Tenant
(including the payment of rent) from the date Landlord would have been able
to deliver the Premises to Tenant but for Tenant's delay(s). Tenant shall
have the right to terminate this Lease by written notice to Landlord if
Landlord has not tendered possession of the Premises to Tenant on or before
December 15, 1999.
SECTION 3.3 RIGHT TO EXTEND THIS LEASE. Provided that Tenant is not in
default under any provision of this Lease, either at the time of exercise of
the extension right granted herein or at the time of the commencement of such
extension, and provided further that Tenant is occupying the entire Premises
and has not assigned or sublet any of its interest in this Lease, Tenant may
extend the Term of this Lease for one (1) period of two (2) months. Tenant
shall exercise its right to extend the Term by and only by delivering to
Landlord, not less than six (6) months or more than nine (9) months prior to
the expiration date of the Term, or the preceding extension period, as
applicable, Tenant's irrevocable written notice of its commitment to extend
(the "Commitment Notice"). Tenant's lease of the Premises during each
extension period shall be on the same terms and conditions set forth in this
Lease.
If Tenant fails to timely comply with all of the provisions of this
paragraph, Tenant's right to extend the Term shall be extinguished and the
Lease shall automatically terminate as of the expiration date of the Term,
without any extension and without any liability to Landlord. Any attempt to
assign or transfer any right or interest created by this paragraph shall be
void from its inception. Tenant shall have no other right to extend the term
beyond the one (1) two (2) month extension created by this paragraph. Unless
agreed to in a writing signed by Landlord and Tenant, any extension of
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the Term, whether created by an amendment to this Lease or by a holdover of
the Premises by Tenant, or otherwise, shall be deemed a part of, and not in
addition to, any duly exercised extension period permitted by this paragraph.
ARTICLE IV. RENT AND OPERATING EXPENSES
SECTION 4.1. BASIC RENT. From and after the Commencement Date, Tenant
shall pay to landlord without deduction or offset, Basic Rent for the
Premises in the total amount shown (including subsequent adjustments, if any)
in Item 6 of the Basic Lease Provisions. Any rental adjustment shown in Item
6 shall be deemed to occur on the specified monthly anniversary of the
Commencement Date, whether or not that date occurs at the end of a calendar
month. The rent shall be due and payable in advance commencing on the
Commencement Date (as prorated for any partial month) and continuing
thereafter on the first day of each successive calendar month of the Term. No
demand, notice or invoice shall be required for the payment of Basic Rent. An
installment of rent in the amount of one (1) full month's Basic Rent at the
initial rate specified in Item 6 of the Basic Lease Provisions shall be
delivered to Landlord concurrently with Tenant's execution of this Lease and
shall be applied against the Basic Rent first due hereunder.
SECTION 4.2 OPERATING EXPENSES.
(a) Tenant shall pay to Landlord, as additional rent, Tenant's Share of
"Operating Expenses", as defined below, incurred by Landlord in the operation
of the Building and Project. The term "Tenant's Share" means that portion of
an Operating Expense determined by multiplying the cost of such item by a
fraction, the numerator of which is the floor area of the Premises and the
denominator of which is the total square footage of the floor area, as of the
date on which the computation is made, to be charged with such Operating
Expense.
(b) Commencing prior to the start of the first full "Expense Recovery
Period" (as defined below) of the Lease, and prior to the start of each full
or partial Expense Recovery Period thereafter, Landlord shall give Tenant a
written estimate of the amount of Tenant's Share of Operating Expenses for
the Expense Recovery Period. Tenant shall pay the estimated amounts to
Landlord in equal monthly installments, in advance, with Basic Rent. If
Landlord has not furnished its written estimate for any Expense Recovery
Period by the time set forth above, Tenant shall continue to pay cost
reimbursements at the rates established for the prior Expense Recovery
Period, if any; provided that when the new estimate is delivered to Tenant,
Tenant shall, at the next monthly payment date, pay any accrued cost
reimbursements based upon the new estimate. For purposes hereof, "Expense
Recovery Period" shall mean every twelve month period during the Term (or
portion thereof for the first and last lease years) commencing July 1 and
ending June 30.
(c) Within one hundred twenty (120) days after the end of each Expense
Recovery Period, Landlord shall furnish to Tenant a statement showing in
reasonable detail the actual or prorated Operating Expenses incurred by
Landlord during the period, and the parties shall within thirty (30) days
thereafter make any payment or allowance necessary to adjust Tenant's
estimated payments, if any, to the actual Tenant's Share as shown by the
annual statement. Any delay or failure by Landlord in delivering any
statement hereunder shall not constitute a waiver of Landlord's right to
require Tenant to pay Tenant's Share of Operating Expenses pursuant hereto.
Any amount due Tenant shall be credited against installments next coming due
under this Section 4.2, and any deficiency shall be paid by Tenant together
with the next installment. If Tenant has not made estimated payments during
the Expense Recovery Period, any amount owing by Tenant pursuant to
subsection (a) above shall be paid to Landlord in accordance with Article
XVI. Should Tenant fail to object in writing to Landlord's determination of
actual Operating Expenses within sixty (60) days following delivery of
Landlord's expense statement, Landlord's determination of actual Operating
Expenses for the applicable Expense Recovery Period shall be conclusive and
binding on the parties and any future claims of the contrary shall be barred.
Provided Tenant is not then in default hereunder, Tenant shall have the
right to cause an employee of Tenant or a certified public accountant to
audit Landlord's Operating Expenses. In no event, however, shall any such
accountant be compensated by Tenant on a "contingency" basis, or on any
other basis tied to the results of said audit. Tenant shall give notice to
Landlord of Tenant's intent to audit within ninety (90) days after Tenant's
receipt of Landlord's expense statement which sets forth Landlord's actual
Operating Expenses. Such audit shall be conducted at a mutually agreeable
time during normal business hours at the office of Landlord or its management
agent where the records are maintained. If Tenant's audit determines that
actual Operating Expenses have been overstated by more than five percent
(5%), then subject to Landlord's right to review and/or contest the audit
results, Landlord shall reimburse Tenant for the reasonable out-of-pocket
costs of such audit. Tenant's rent shall be appropriately adjusted to
reflect any overstatement in Operating Expenses. In the event of a dispute
between Landlord and Tenant regarding the results of such audit, either party
may elect to submit the matter for binding arbitration with JAMS or its
successor in Orange County, California in accordance with the provisions of
Section 22.7 of this Lease.
All of the information obtained by Tenant and/or its auditor in connection
with such audit, as well as any compromise, settlement, or adjustment reached
between Landlord and Tenant as a result thereof, shall be held in strict
confidence and, except as may be required pursuant to litigation shall not be
disclosed to any third party, directly or indirectly, by Tenant or its
auditor or any of their officers, agents or employees. Landlord may require
Tenant's auditor to execute a separate confidentiality agreement reasonably
acceptable to Tenant affirming the foregoing as a condition precedent to any
audit.
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(d) Even though the Lease has terminated and the Tenant has vacated the
Premises, when the final determination is made of Tenant's Share of Operating
Expenses for the Expense Recovery Period in which the Lease terminates,
Tenant shall upon notice pay the entire increase due over the estimated
expenses paid. Conversely, any overpayment made in the event expenses
decrease shall be rebated by Landlord to Tenant.
(e) If, at any time during any Expense Recovery Period Period, any one or
more of the Operating Expenses are increased to a rate(s) or amount(s) in
excess of the rate(s) or amount(s) used in calculating the estimated expenses
for the year, then the estimate of Tenant's Share of Operating Expenses shall
be increased for the month in which such rate(s) or amount(s) becomes
effective and for all succeeding months by an amount equal to Tenant's Share
of the increase. Landlord shall give Tenant written notice of the amount or
estimated amount of the increase, the month in which the increase will become
effective, Tenant's Share thereof and the month for which the payments are
due. Tenant shall pay the increase to Landlord as a part of Tenant's monthly
payments of estimated expenses as provided in paragraph (b) above, commencing
with the month in which effective.
(f) The term "Operating Expenses" shall mean and include all "Project
Costs" (as hereafter defined) and "Property Taxes" (as hereafter defined).
(g) The term "Project Costs" shall include all expenses of operation and
maintenance of the Building and the Project, together with all appurtenant
Common Areas (as defined in Section 6.2), and shall include the following
charges by way of illustration but not limitation: water and sewer charges;
insurance premiums or reasonable premium equivalents should Landlord elect to
self-insure any risk that Landlord is authorized to insure hereunder;
license, permit, and inspection fees; heat, light; power; janitorial services
to any interior Common Areas; air conditioning; supplies; materials;
equipment; tools; the cost of any environmental, insurance, tax or other
consultant utilized by Landlord in connection with the Building and/or
Project; establishment of reasonable reserves for replacements and/or repair
of the Building and/or Common Area improvements, equipment and supplies;
costs incurred in connection with compliance of any laws or changes in laws
applicable to the Building or the Project; the cost of any capital
investments (other than tenant improvements for specific tenants) to the
extent of the amortized amount thereof over the useful life of such capital
investments calculated at a market cost of funds, all as determined by
Landlord, for each such year of useful life during the Term; costs associated
with the procurement and maintenance of an air conditioning, heating and
ventilation service agreement, and procurement and maintenance of an
intrabuilding network cable service agreement for any intrabuilding network
cable telecommunications lines within the Project, and any other
installation, maintenance, repair and replacement costs associated with such
lines; labor; reasonably allocated wages and salaries, fringe benefits, and
payroll taxes for administrative and other personnel directly applicable to
the Building and/or Project, including both Landlord's personnel and outside
personnel; any expense incurred pursuant to Sections 6.1, 6.2, 6.4, 7.2, and
10.2; and a reasonable overhead/management fee for the professional operation
of the Project. It is understood that Project Costs shall include competitive
charges for direct services provided by any subsidiary or division of
Landlord.
(h) The term "Property Taxes" as used herein shall include the
following: (i) all real estate taxes or personal property taxes, as such
property taxes may be reassessed from time to time; and (ii) other taxes,
charges and assessments which are levied with respect to this Lease or to the
Building and/or the Project, and any improvements, fixtures and equipment and
other property of Landlord located in the Building and/or the Project, except
that general net income and franchise taxes imposed against Landlord shall be
excluded; and (iii) all assessments and fees for public improvements,
services, and facilities and impacts thereon, including, without limitation,
arising out of any Community Facilities Districts, "Xxxxx Xxxx" districts,
similar assessment districts, and any traffic impact mitigation assessments
or fees; (iv) any tax, surcharge or assessment which shall be levied in
addition to or in lieu of real estate or personal property taxes, other than
taxes covered by Article VIII; and (v) costs and expenses incurred in
contesting the amount or validity of any Property Tax by appropriate
proceedings.
SECTION 4.3 SECURITY DEPOSIT. Concurrently with Tenant's delivery of this
Lease, Tenant shall deposit with Landlord the sum, if any, stated in Item 9
of the Basic Lease Provisions, to be held by Landlord as security for the
full and faithful performance of Tenant's obligations under this Lease (the
"Security Deposit"). Subject to the last sentence of this Section, the Security
Deposit shall be understood and agreed to be the property of Landlord upon
Landlord's receipt thereof, and may be utilized by Landlord in its discretion
towards the payment of all prepaid expenses by Landlord for which Tenant
would be required to reimburse Landlord under this Lease, including, without
limitation, brokerage commissions. Upon any default by Tenant, including
specifically Tenant's failure to pay rent or to abide by its obligations
under Sections 7.1 and 15.3 below, whether or not Landlord is informed of or
has knowledge of the default, the Security Deposit shall be deemed to be
automatically and immediately applied, without waiver of any rights Landlord
may have under this Lease or at law or in equity as a result of the default,
as a setoff for full or partial compensation for that default. If any portion
of the Security Deposit is applied after a default by Tenant, Tenant shall
within five (5) days after written demand by Landlord deposit cash with
Landlord in an amount sufficient to restore the Security Deposit to its
original amount. Landlord shall not be required to keep this Security Deposit
separate from its general funds, and Tenant shall not be entitled to interest
on the Security Deposit. If Tenant fully performs its obligations under this
Lease, the Security Deposit shall be returned to Tenant (or, at Landlord's
option, to the last assignee of Tenant's interest in this Lease) after the
expiration of the Term, provided that Landlord may retain the Security
Deposit to the extent and until such time as all amounts due from Tenant in
accordance with this Lease have been determined and paid in full.
ARTICLE V. USES
SECTION 5.1 USE. Tenant shall use the Premises only for the purposes
stated in Item 3 of the Basic Lease Provisions, all in accordance with
applicable laws and restrictions and pursuant to approvals to be obtained by
Tenant
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from all relevant and required governmental agencies and authorities. The
parties agree that any contrary use shall be deemed to cause material and
irreparable harm to Landlord and shall entitle Landlord to injunctive relief
in addition to any other available remedy. Tenant, at its expense, shall
procure, maintain and make available for Landlord's inspection throughout the
Term, all governmental approvals, licenses and permits required for the
proper and lawful conduct of Tenant's permitted use of the Premises. Tenant
shall not do or permit anything to be done in or about the Premises which
will in any way interfere with the rights of other occupants of the Building
or the Project, or use or allow the Premises to be used for any unlawful
purpose, nor shall Tenant permit any nuisance or commit any waste in the
Premises or the Project. Tenant shall not perform any work or conduct any
business whatsoever in the Project other than inside the Premises. Tenant
shall not do or permit to be done anything which will invalidate or increase
the cost of any insurance policy(ies) covering the Building, the Project
and/or their contents, and shall comply with all applicable insurance
underwriters rules and the requirements of the Pacific Fire Rating Bureau or
any other organization performing a similar function. Tenant shall comply at
its expense with all present and future laws, ordinances, restrictions,
regulations, orders, rules and requirements of all governmental authorities
that pertain to Tenant or its use of the premises, including, without
limitation, all federal and state occupational health and safety
requirements, whether or not Tenant's compliance will necessitate
expenditures or interfere with its use and enjoyment of the Premises. Tenant
shall comply at its expense with all present and future covenants,
conditions, easements or restrictions now or hereafter affecting or
encumbering the Building and/or Project, and any amendments or modifications
thereto, including, without limitation, the payment by Tenant of any periodic
or special dues or assessments charged against the Premises or Tenant which
may be allocated to the Premises or Tenant in accordance with the provisions
thereof. Tenant shall promptly upon demand reimburse Landlord for any
additional insurance premium charged by reason of Tenant's failure to comply
with the provisions of this Section, and shall indemnify Landlord from any
liability and/or expense resulting from Tenant's noncompliance.
SECTION 5.2. SIGNS. Provided Tenant continues to occupy the entire
Premises, Tenant shall have the non-exclusive right to one (1) exterior
building top sign on the Building, subject to Landlord's right of prior
approval that such exterior signage is in compliance with the Signage
Criteria (defined below). Except as provided in the foregoing or as otherwise
approved in writing by Landlord, in its sole discretion, Tenant shall have no
right to maintain identification signs in any location, on or about the
Premises, the Building or the Project and shall not place or erect any other
signs, displays or other advertising materials that are visible from the
exterior of the Building. The size, design, graphics, material, style, color
and other physical aspects of any permitted sign shall be subject to
Landlord's written approval prior to installation (which approval may be
withheld in Landlord's discretion), any covenants, conditions or restrictions
encumbering the Premises, Landlord's signage program for the Project, as in
effect from time to time and approved by the City in which the Premises are
located ("Signage Criteria"), and any applicable municipal or other
governmental permits and approvals. Tenant acknowledges having received and
reviewed a copy of the current Signage Criteria for the Project. Tenant shall
be responsible for the cost of any permitted sign, including the fabrication,
installation, maintenance and removal thereof. If Tenant fails to maintain
its sign, or if Tenant fails to remove same upon termination of this Lease
and repair any damage caused by such removal, Landlord may do so at Tenant's
expense.
SECTION 5.3. HAZARDOUS MATERIALS.
(a) For purposes of this Lease, the term "hazardous Materials"
includes (i) any "hazardous materials" as defined in Section 25501(n) of the
California Health and Safety Code, (ii) any other substance or matter which
results in liability to any person or entity from exposure to such substance
or matter under any statutory or common law theory, and (iii) any substance
or matter which is in excess of permitted levels set forth in any federal,
California or local law or regulation pertaining to any hazardous or toxic
substance, material or waste.
(b) Tenant shall not cause or permit any Hazardous Materials to
be brought upon, stored, used, generated, released or disposed of on, under,
from or about the Premises (including, without limitation, the soil and
groundwater thereunder) without the prior written consent of Landlord.
Notwithstanding the foregoing, Tenant shall have the right, without obtaining
prior written consent of Landlord, to utilize within the Premises standard
office products that may contain Hazardous Materials (such as photocopy toner,
"White Out", and the like), PROVIDED HOWEVER, that (i) Tenant shall maintain
such products in their original retail packaging, shall follow all
instructions on such packaging with respect to the storage, use and disposal
of such products, and shall otherwise comply with all applicable laws with
respect to such products, and (ii) all of the other terms and provisions of
this Section 5.3 shall apply with respect to Tenant's storage, use and
disposal of all such products. Landlord may, in its sole discretion, place
such conditions as Landlord deems appropriate with respect to any such
Hazardous Materials, and may further require that Tenant demonstrate that any
such Hazardous Materials are necessary or useful to Tenant's business and
will be generated, stored, used and disposed of in a manner that complies
with all applicable laws and regulations pertaining thereto and with good
business practices. Tenant understands that Landlord may utilize an
environmental consultant to assist in determining conditions of approval in
connection with the storage, generation, release, disposal or use of
Hazardous Materials by Tenant on or about the Premises, and/or conduct
periodic inspections of the storage, generation, use, release and/or disposal
of such Hazardous Materials by Tenant on and from the Premises, and Tenant
agrees that any costs incurred by Landlord in connection therewith shall be
reimbursed by Tenant to Landlord as additional rent hereunder upon demand.
(c) Prior to the execution of this Lease, Tenant shall complete,
execute and deliver to Landlord an Environmental Questionnaire and Disclosure
Statement (the ""Environmental Questionnaire") in the form of EXHIBIT B
attached hereto. The completed Environmental Questionnaire shall be deemed
incorporated into this Lease for all purposes, and Landlord shall be
entitled to rely fully on the information contained therein. On each
anniversary of the Commencement Date until the expiration or sooner
termination of this Lease, Tenant shall disclose to Landlord in writing the
names and amounts of all Hazardous Materials which were stored, generated,
used, released and/or disposed of on, under or about the Premises for the
twelve-month period prior thereto, and which Tenant desires to store,
generate, use, release and/or dispose of on, under or about the Premises for
the succeeding twelve-month period. In
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addition, to the extent Tenant is permitted to utilize Hazardous Materials
upon the Premises, Tenant shall promptly provide Landlord with complete and
legible copies of all the following environmental documents relating thereto:
reports filed pursuant to any self-reporting requirements; permits
applications, permits, monitoring reports, workplace exposure and community
exposure warnings or notices and all other reports, disclosures, plans or
documents (even those which may be characterized as confidential) relating to
water discharges, air pollution, waste generation or disposal, and
underground storage tanks for Hazardous Materials; orders, reports, notices,
listings and correspondence (even those which may be considered confidential)
of or concerning the release, investigation of, compliance, cleanup, remedial
and corrective actions, and abatement of Hazardous Materials; and all
complaints, pleadings and other legal documents filed by or against Tenant
related to Tenant's use, handling, storage, release and/or disposal of
Hazardous Materials.
(d) Landlord and its agents shall have the right, but not the
obligation, to inspect, sample and/or monitor the Premises and/or the soil or
groundwater thereunder at any time to determine whether Tenant is complying
with the terms of this Section 5.3, and in connection therewith Tenant shall
provide Landlord with full access to all relevant facilities, records and
personnel. If Tenant is not in compliance with any of the provisions of this
Section 5.3, or in the event of a release of any Hazardous Material on, under
or about the Premises caused or permitted by Tenant, its agents, employees,
contractors, licensees or invitees, Landlord and its agents shall have the
right, but not the obligation, without limitation upon any of Landlord's
other rights and remedies under this Lease, to immediately enter upon the
Premises without notice and to discharge Tenant's obligations under this
Section 5.3 at Tenant's expense, including, without limitation, the taking of
emergency or long-term remedial action. Landlord and its agents shall
endeavor to minimize interference with Tenant's business in connection
therewith, but shall not be liable for any such interference. In addition,
Landlord, at Tenant's expense, shall have the right, but not the obligation,
to join and participate in any legal proceedings or actions initiated in
connection with any claims arising out of the storage, generation, use,
release and/or disposal by Tenant or its agents, employees, contractors,
licensees or invitees of Hazardous Materials on, under, from or about the
Premises.
(e) If the presence of any Hazardous Materials on, under, from or about
the Premises or the Project caused or permitted by Tenant or its agents,
employees, contractors, licensees or invitees results in (i) injury to any
person, (ii) injury to or any contamination of the Premises or the Project,
or (iii) injury to or contamination of any real or personal property
wherever situated, Tenant, at its expense, shall promptly take all actions
necessary to return the Premises and the Project and any other affected real
or personal property owned by Landlord to the condition existing prior to the
introduction of such Hazardous Materials and to remedy or repair any such
injury or contamination, including, without limitation, any cleanup,
remediation, removal, disposal, neutralization or other treatment of any
such Hazardous Materials. Notwithstanding the foregoing, Tenant shall not,
without Landlord's prior written consent, take any remedial action in
response to the presence of any Hazardous Materials on, under or about the
Premises or the Project or any other affected real or personal property owned
by Landlord or enter into any similar agreement, consent, decree or other
compromise with any governmental agency with respect to any Hazardous
Materials claims; provided however, Landlord's prior written consent shall
not be necessary in the event that the presence of Hazardous Materials on,
under or about the Premises or the Project or any other affected real or
personal property owned by Landlord (i) imposes an immediate threat to the
health, safety or welfare of any individual or (ii) is of such a nature that
an immediate remedial response is necessary and it is not possible to obtain
Landlord's consent before taking such action. To the fullest extent permitted
by law, Tenant shall indemnify, hold harmless, protect and defend (with
attorneys acceptable to Landlord) Landlord and any successors to all or any
portion of Landlord's interest in the Premises and the Project and any other
real or personal property owned by Landlord from and against any and all
liabilities, losses, damages, diminution in value, judgments, fines, demands,
claims, recoveries, deficiencies, costs and expenses (including, without
limitation, attorneys' fees, court costs and other professional expenses),
whether foreseeable or unforeseeable, arising directly or indirectly out of
the use, generation, storage, treatment, release, on- or off-site disposal
or transportation of Hazardous Materials on, into, from, under or about the
Premises, the Building and the Project and any other real or personal
property owned by Landlord caused or permitted by Tenant, its agents,
employees, contractors, licensees or invitees, specifically including, without
limitation, the cost of any required or necessary repair, restoration,
cleanup or detoxification of the Premises, the Building and the Project and
any other real or personal property owned by Landlord, and the preparation of
any closure or other required plans, whether or not such action is required
or necessary during the Term or after the expiration of this Lease. If
Landlord at any time discovers that Tenant or its agents, employees,
contractors, licensees or invitees may have caused or permitted the release of
a Hazardous Materials on, under, from or about the Premises or the Project or
any other real or personal property owned by Landlord, Tenant shall, at
Landlord's request, immediately prepare and submit to Landlord a
comprehensive plan, subject to Landlord's approval, specifying the actions to
be taken by Tenant to return the Premises or the Project or any other real or
personal property owned by Landlord to the condition existing prior to the
introduction of such Hazardous Materials. Upon Landlord's approval of such
cleanup plan, Tenant shall, at its expense, and without limitation of any
rights and remedies of Landlord under this Lease or at law or in equity,
immediately implement such plan and proceed to cleanup such Hazardous
Materials in accordance with all applicable laws and as required by such plan
and this Lease. The provisions of this subsection (e) shall expressly survive
the expiration or sooner termination of this Lease.
(f) Landlord hereby discloses to Tenant, and Tenant hereby acknowledges,
certain facts relating to Hazardous Materials at the Project known by
Landlord to exist as of the date of this Lease, as more particularly
described in Exhibit C attached hereto. Tenant shall have no liability or
responsibility with respect to the Hazardous Materials facts described in
EXHIBIT C, nor with respect to any Hazardous Materials which Tenant proves
were not caused or permitted by Tenant, its agents, employees, contractors,
licensees or invitees. Notwithstanding the preceding two sentences, Tenant
agrees to notify its agents, employees, contractors, licensees, and invitees
of any exposure or potential exposure to Hazardous Materials at the Premises
that Landlord brings to Tenant's attention. Except as disclosed in EXHIBIT C
(and/or as may otherwise be disclosed to Tenant in writing), Landlord
represents that, to the best of its all actual knowledge without duty of
inquiry or investigation whatsoever, there are no Hazardous Materials in or
about the Premises which are in violation of any applicable federal, state or
local law, ordinance or regulation.
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ARTICLE VI. COMMON AREAS; SERVICES
SECTION 6.1 UTILITIES AND SERVICES. Tenant shall be responsible for and
shall pay promptly, directly to the appropriate supplier, all charges for
water, gas, electricity, sewer, heat, light, power, telephone, refuse pickup,
janitorial service, interior landscape maintenance and all other utilities,
materials and services furnished directly to Tenant or the Premises or used
by Tenant in, on or about the Premises during the Term, together with any
taxes thereon. If any utilities or services are not separately metered or
assessed to Tenant, Landlord shall make a reasonable determination of
Tenant's proportionate share of the cost of such utilities and services and
Tenant shall pay such amount to Landlord, as an item of additional rent,
within ten (10) days after receipt of Landlord's statement or invoice
therefor. Alternatively, Landlord may elect to include such cost in the
definition of Building Costs in which event Tenant shall pay Tenant's
proportionate share of such costs in the manner set forth in Section 4.2.
Landlord shall not be liable for damages or otherwise for any failure or
interruption of any utility or other service furnished to the Premises, and
no such failure or interruption shall be deemed an eviction or entitle Tenant
to terminate this Lease or withhold or xxxxx any rent due hereunder. Landlord
shall at all reasonable times have free access to all electrical and
mechanical installations of Landlord. Notwithstanding the foregoing, if as a
result of the actions of Landlord, its agents, contractors or employees or
the inactions of Landlord if Landlord is required to act under this Lease,
for more than three (3) consecutive business days following written notice to
Landlord there is no HVAC service or electricity service to all or a portion
of the Premises, or such an interruption of other essential utilities and
building services, such as fire protection or water, so that all or a portion
of the Premises cannot be used by Tenant, then Tenant's obligation to pay
Basic Rent and Operating Expenses (or an equitable portion of such Basic Rent
and Operating Expenses to the extent that less than all of the Premises are
affected) shall thereafter be abated until the Premises are again useable by
Tenant; provided, however, that if Landlord is diligently pursuing the repair
of such utilities or services and Landlord provides substitute services
reasonably suitable for Tenant's purposes, as for example, bringing in
portable air-conditioning equipment, then there shall not be abatement of
Basic Rent or Operating Expenses. Any disputes concerning the foregoing shall
be resolved by JAMS arbitration pursuant to Section 22.7 of this Lease. The
foregoing provisions shall not apply in case of damage to, or destruction of,
the Premises, which shall be governed by the provisions of Article XI of the
Lease.
SECTION 6.2 OPERATION AND MAINTENANCE OF COMMON AREAS. During the Term,
Landlord shall operate all Common Areas within the Building and the Project.
The term "Common Areas" shall mean all areas within the exterior boundaries
of the Building and other buildings in the Project which are not held for
exclusive use by persons entitled to occupy space, and all other appurtenant
areas and improvements provided by Landlord for the common use of Landlord
and tenants and their respective employees and invitees, including, without
limitation, parking areas and structures, driveways, sidewalks, landscaped
and planted areas, hallways and interior stairwells not located within the
premises of any tenant, common electrical rooms and roof access entries,
common entrances and lobbies, elevators, and restrooms not located within the
premises of any tenant.
SECTION 6.3 USE OF COMMON AREAS. The occupancy by Tenant of the Premises
shall include the use of the Common Areas in common with Landlord and with
all others for whose convenience and use the Common Areas may be provided by
Landlord, subject, however, to compliance with all rules and regulations as
are prescribed from time to time by Landlord. Landlord shall operate and
maintain the Common Areas in the manner Landlord may determine to be
appropriate. All costs incurred by Landlord for the maintenance and operation
of the Common Areas shall be included in Project Costs unless any particular
cost incurred can be charged to a specific tenant of the Project. Landlord
shall at all times during the Term have exclusive control of the Common
Areas, and may restrain any use or occupancy, except as authorized by
Landlord's rules and regulations. Tenant shall keep the Common Areas clear of
any obstruction or unauthorized use related to Tenant's operations. Nothing
in this Lease shall be deemed to impose liability upon Landlord for any
damage to or loss of the property of, or for any injury to, Tenant, its
invitees or employees. Landlord may temporarily close any portion of the
Common Areas for repairs, remodeling and/or alterations, to prevent a public
dedication or the accrual of prescriptive rights, or for any other reason
deemed sufficient by Landlord, without liability to Landlord.
SECTION 6.4 PARKING. Tenant shall be entitled to the number of vehicle
parking spaces set forth in Item 14 of the Basic Lease Provisions, which
spaces shall be unreserved and unassigned, (except as otherwise designated by
Landlord), on those portions of the Common Areas designated by Landlord for
parking. Tenant shall not use more parking spaces than such number, nor shall
Tenant cause or permit its employees, agents or invitees to park in areas
other than as designated by Landlord. Tenant shall reimburse Landlord for the
reasonable cost of monitoring Tenant's compliance with the foregoing. All
parking spaces shall be used only for parking by vehicles no larger than full
size passenger automobiles or pickup trucks. Tenant shall not permit or allow
any vehicles that belong to or are controlled by Tenant or Tenant's employees
suppliers, shippers, customers or invitees to be loaded, unloaded or parked
in areas other than those designated by Landlord for such activities. If
Tenant permits or allows any of the prohibited activities described above,
then Landlord shall have the right, without notice, in addition to such other
rights and remedies that Landlord may have, to remove or tow away the vehicle
involved and charge the costs to Tenant. Parking within the Common Areas
shall be limited to striped parking stalls, and no parking shall be permitted
in any driveways, access ways or in any area which would prohibit or impede
the free flow of traffic within the Common Areas. There shall be no overnight
parking of any vehicles of any kind unless otherwise authorized by Landlord,
and vehicles which have been abandoned or parked in violation of the terms
hereof may be towed away at the owner's expense. Nothing contained in this
Lease shall be deemed to create liability upon Landlord for any damage to
motor vehicles of visitors or employees, for any loss of property from within
those motor vehicles, or for any injury to Tenant, its visitors or employees,
unless ultimately determined to be caused by the sole active negligence or
willful misconduct of Landlord. Landlord shall have the right to establish,
and from time to time amend, and to enforce against all users all reasonable
rules and regulations (including the designation of areas for employee
parking) that Landlord may deem necessary and advisable for the proper and
efficient operation and maintenance of parking within the Common Areas.
Landlord shall
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have the right to construct, maintain and operate lighting facilities within
the parking areas; to change the area, level, location and arrangement of the
parking areas and improvements therein; to restrict parking by tenants, their
officers, agents and employees to employee parking areas; and to do and
perform such other acts in and to the parking areas and improvements therein
as, in the use of good business judgment, Landlord shall determine to be
advisable. Any person using the parking area shall observe all directional
signs and arrows and any posted speed limits. In no event shall Tenant
interfere with the use and enjoyment of the parking area by other tenants of
the Building or their employees or invitees. Parking areas shall be used only
for parking vehicles. Washing, waxing, cleaning or servicing of vehicles, or
the storage of vehicles for 24-hour periods, is prohibited unless otherwise
authorized by Landlord. Tenant shall be liable for any damage to the parking
areas caused by Tenant or Tenant's employees, suppliers, shippers, customers
or invitees, including, without limitation, damage from excess oil leakage.
Tenant shall have no right to install any fixtures, equipment or personal
property in the parking areas.
During Term of this Lease, Landlord agrees that, subject to their month to
month availability as determined by Landlord, Tenant may license unreserved
spaces located within the Project in addition to the number of vehicle
parking spaces set forth in Item 14 of the Basic Lease Provisions
("Additional Parking"). The terms for the license of such Additional Parking
shall include a monthly parking charge of Twenty-Five Dollars ($25.00) for
each additional parking space and the reimbursement of reasonable monitoring
costs of such parking. If Tenant accepts Landlord's proposal for the license
of such Additional Parking within ten (10) days following receipt of said
proposal from Landlord, Landlord shall prepare a license agreement, in form
reasonably acceptable to Tenant for execution by Landlord and Tenant,
confirming the license of said Additional Parking at the location and on the
terms proposed to and accepted by Tenant.
SECTION 6.5. CHANGES AND ADDITIONS BY LANDLORD. Landlord reserves the
right to make alterations or additions to the Building or the Project, or to
the attendant fixtures, equipment and Common Areas. Landlord may at any time
relocate or remove any of the various buildings, parking areas, and other
Common Areas, and may add buildings and areas to the Project from time to
time. No change shall entitle Tenant to any abatement of rent or other claim
against Landlord, provided that the change does not deprive Tenant of
reasonable access to or use of the Premises.
ARTICLE VII. MAINTAINING THE PREMISES
SECTION 7.1. TENANT'S MAINTENANCE AND REPAIR. Tenant at its sole expense
shall comply with all applicable laws and governmental regulations governing
the Premises and make all repairs necessary to keep the Premises in the
condition as existed on the Commencement Date, excepting ordinary wear and
tear, including, without limitation, the electrical and mechanical systems,
all glass, windows, doors, door closures, hardware, fixtures, electrical,
plumbing, fire extinguisher equipment and other equipment. Any damage or
deterioration of the Premises shall not be deemed ordinary wear and tear if
the same could have been prevented by good maintenance practices by Tenant.
As part of its maintenance obligations hereunder, Tenant shall, at Landlord's
request, provide Landlord with copies of all maintenance schedules, reports
and notices prepared by, for or on behalf of Tenant. All repairs shall be at
least equal in quality to the original work, shall be made only by a licensed
contractor approved in writing in advance by Landlord (which approval shall
not be unreasonably withheld) and shall be made only at the time or times
approved by Landlord. Any contractor utilized by Tenant shall be subject to
Landlord's standard requirements for contractors, as modified from time to
time. Landlord may impose reasonable restrictions and requirements with
respect to repairs, as provided in Section 7.3, and the provisions of Section
7.4 shall apply to all repairs. Alternatively, Landlord may elect to make any
such repair on behalf of Tenant and at Tenant's expense, and Tenant shall
promptly reimburse Landlord for all costs incurred upon submission of any
invoice.
SECTION 7.2. LANDLORD'S MAINTENANCE AND REPAIR. Subject to Sections 2.4
and 7.1 and Article XI, Landlord shall provide services, maintenance and
repair with respect to the roof, foundations, and footings of the Building,
all landscaping, walkways, parking areas, Common Areas, exterior lighting,
the air conditioning, ventilating or heating equipment servicing the
Premises, and the exterior surfaces of the exterior walls of the Building,
except that Tenant at its expense shall make all repairs which Landlord deems
reasonably necessary as a result of the act or negligence of Tenant, its
agents, employees, invitees, subtenants or contractors. Landlord shall have
the right to employ or designate any reputable person or firm, including any
employee or agent of Landlord or any of Landlord's affiliates or divisions,
to perform any service, repair or maintenance function. Landlord need not
make any other improvements or repairs except as specifically required under
this Lease, and nothing contained in this Section shall limit Landlord's
right to reimbursement from Tenant for maintenance, repair costs and
replacement costs as provided elsewhere in this Lease. Tenant understands that
it shall not make repairs at Landlord's expense or by rental offset. Tenant
further understands that Landlord shall not be required to make any repairs
to the roof, foundations, footings, structural, electrical or mechanical
systems unless and until Tenant has notified Landlord in writing of the need
for such repair and Landlord shall have a reasonable period of time
thereafter to commence and complete said repair, if warranted. All costs of
any maintenance and repairs on the part of Landlord provided hereunder shall
be considered part of Project Costs.
SECTION 7.3. ALTERATIONS. Tenant shall make no alterations, additions or
improvements to the Premises without the prior written consent of Landlord,
which consent may be given or withheld in Landlord's sole discretion.
Notwithstanding the foregoing, Landlord shall not unreasonably withhold its
consent to any alterations, additions or improvements to the Premises which
cost less than One Dollar ($1.00) per square foot of the improved portions of
the Premises (excluding warehouse square footage) and do not (i) affect the
exterior of the Buildings or outside areas (or be visible from adjoining
sites), or (ii) affect or penetrate any of the structural portions of the
Buildings, including, but not limited to, the roof, or (iii) require any
change to the basic floor plan of the Premises, any change to
8
any structure or mechanical systems of the Premises, or any governmental
permit as a prerequisite to the construction thereof, or (iv) interfere in
any manner with the proper functioning of or Landlord's access to any
mechanical, electrical, plumbing or HVAC systems, facilities or equipment
located in or serving the building, or (v) diminish the value of the
Premises. Landlord may impose, as a condition to its consent, any
requirements that Landlord in its discretion may deem reasonable or
desirable, including, but not limited to, a requirement that all work be
covered by a lien and completion bond satisfactory to Landlord and
requirements as to the manner, time, and contractor for performance of the
work. Tenant shall obtain all required permits for the work and shall perform
the work in compliance with, all applicable laws, regulations and ordinances,
all covenants, conditions and restrictions affecting the Project, and the
Rules and Regulations (hereafter defined). Tenant understands and agrees that
Landlord shall be entitled to a supervision fee in the amount of five percent
(5%) of the cost of the work. If any governmental entity requires, as a
condition to any proposed alterations, additions or improvements to the
Premises by Tenant, that improvements be made to the Common Areas, and if
Landlord consents to such improvements to the Common Areas, then Tenant
shall, at Tenant's sole expense, make such required improvements to the
Common Areas in such manner, utilizing such materials, and with such
contractors (including, if required by Landlord, Landlord's contractors) as
Landlord may require in its sole discretion. Under no circumstances shall
Tenant make any improvement which incorporates any Hazardous Materials,
including, without limitation, asbestos-containing construction materials
into the Premises. Any request for Landlord's consent shall be made in
writing and shall contain architectural plans describing the work in detail
reasonably satisfactory to Landlord. Unless Landlord otherwise agrees in
writing, all alterations, additions or improvements affixed to the Premises
(excluding moveable trade fixtures and furniture) shall become the property
of Landlord and shall be surrendered with the Premises at the end of the
Term, except that Landlord may, by notice to Tenant, require Tenant to remove
by the Expiration Date, or sooner termination date of this Lease, all or any
alterations, decorations, fixtures, additions, improvements and the like
installed either by Tenant or by Landlord at Tenant's request and to repair
any damage to the Premises arising from that removal. Except as otherwise
provided in this Lease or in any Exhibit to this Lease, should Landlord make
any alteration or improvement to the Premises for Tenant, Landlord shall be
entitled to prompt reimbursement from Tenant for all costs incurred.
SECTION 7.4. MECHANIC'S LIENS. Tenant shall keep the Premises free from
any liens arising out of any work performed, materials furnished, or
obligations incurred by or for Tenant. Upon request by Landlord, Tenant shall
promptly cause any such lien to be released by posting a bond in accordance
with California Civil Code Section 3143 or any successor statute. In the event
that Tenant shall not, within (30) days following the imposition of any lien,
cause the lien to be released of record by payment or posting of a proper bond,
Landlord shall have, in addition to all other available remedies, the right
to cause the lien to be released by any means it deems proper, including
payment of or defense against the claim giving rise to the lien. All expenses
so incurred by Landlord, including Landlord's attorney's fees, and any
consequential or other damages incurred by Landlord arising out of such lien,
shall be reimbursed by Tenant promptly following Landlord's demand, together
with interest from the date of payment by Landlord at the maximum rate
permitted by law until paid. Tenant shall give Landlord no less than twenty
(20) days' prior notice in writing before commencing construction of any kind
on the Premises so that Landlord may post and maintain notices of
nonresponsibility on the Premises.
SECTION 7.5 ENTRY AND INSPECTION. Landlord shall at all times, upon
written or oral notice (except in emergencies, when no notice shall be
required) have the right to enter Premises to inspect them, to supply
services in accordance with the Lease, to protect the interests of Landlord
in the Premises, and to submit the Premises to prospective or actual
purchasers or encumbrance holders (or, during the last one hundred and eighty
(180) days of the Term or when an uncured Tenant default exists, to
prospective tenants), all without being deemed to have caused an eviction of
Tenant and without abatement of rent except as provided elsewhere in this
Lease. Landlord shall have the right, if desired, to retain a key which
unlocks all of the doors to the Premises, excluding Tenant's vaults and
safes, and Landlord shall have the right to use any and all means which
Landlord may deem proper to open the doors in an emergency in order to obtain
entry to the Premises, and any entry to the Premises obtained by Landlord
shall not under any circumstances be deemed a forcible or unlawful entry
into, or a detainer of, the Premises, or any eviction of Tenant from the
Premises.
ARTICLE VIII. TAXES AND ASSESSMENTS ON TENANT'S PROPERTY
Tenant shall be liable for and shall pay, at least ten (10) days before
delinquency, all taxes and assessments levied against all personal property
of Tenant located in the Premises, against all improvements to the Premises
made by Landlord or Tenant which are above Landlord's Project standard in
quality and/or quantity for comparable space within the Project ("Above
Standard Improvements"), and against any alterations, additions or like
improvements made to the Premises by or on behalf of Tenant. When possible
Tenant shall cause its personal property, Above Standard Improvements and
alterations to be assessed and billed separately from the real property of
which the Premises form a part. If any taxes on Tenant's personal property,
Above Standard Improvements and/or alterations are levied against Landlord or
Landlord's property and if Landlord pays the same, or if the assessed value
of Landlord's property is increased by inclusion of a value placed upon the
personal property, Above Standard Improvements and/or alterations of Tenant
and if Landlord pays the taxes based upon the increased assessment, Tenant
shall pay the Landlord the taxes so levied against the Landlord or the
proportion of the taxes resulting from the increase in the assessment. In
calculating what portion of any tax xxxx which is assessed against Landlord
separately, or Landlord and Tenant jointly, is attributable to Tenant's Above
Standard Improvements, alterations,and personal property, Landlord's
reasonable determination shall be conclusive.
9
ARTICLE IX. ASSIGNMENT AND SUBLETTING
SECTION 9.1. RIGHTS OF PARTIES.
(a) Notwithstanding any provision of this Lease to the contrary, Tenant
will not, either voluntarily or by operation of law, assign, sublet,
encumber, or otherwise transfer all or any part of Tenant's interest in this
lease, or permit the Premises to be occupied by anyone other than Tenant,
without Landlord's prior written consent, which consent shall not
unreasonably be withheld in accordance with the provisions of Section 9.1(b).
No assignment (whether voluntary, involuntary or by operation of law) and no
subletting shall be valid or effective without Landlord's prior written
consent and, at Landlord's election, any such assignment or subletting or
attempted assignment or subletting shall constitute a material default of
this Lease. Landlord shall not be deemed to have given its consent to any
assignment or subletting by any other course of action, including its
acceptance of any name for listing in the Building directory. To the extent
not prohibited by provisions of the Bankruptcy Code, 11 U.S.C. Section 101 et
seq. (the Bankruptcy Code"), including Section 365(f)(1), Tenant on behalf of
itself and its creditors, administrators and assigns waives the applicability
of Section 365(e) of the Bankruptcy Code unless the proposed assignee of the
Trustee for the estate of the bankrupt meets Landlord's standards for consent
as set forth in Section 9.1(b) of this Lease. If this Lease is assigned to
any person or entity pursuant to the provisions of the Bankruptcy Code, any
and all monies or other considerations to be delivered in connection with the
assignment shall be delivered to Landlord, shall be and remain the exclusive
property of Landlord and shall not constitute property of Tenant or of the
estate of Tenant within the meaning of the Bankruptcy Code. Any person or
entity to which this Lease is assigned pursuant to the provisions of the
Bankruptcy Code shall be deemed to have assumed all of the obligations
arising under this Lease on and after the date of the assignment, and shall
upon demand execute and deliver to Landlord an instrument confirming that
assumption.
(b) If Tenant desires to transfer an interest in this Lease, it shall
first notify Landlord of its desire and shall submit in writing to Landlord:
(i) the name and address of the proposed transferee; (ii) the nature of any
proposed subtenant's or assignee's business to be carried on in the Premises;
(iii) the terms and provisions of any proposed sublease or assignment,
including a copy of the proposed assignment or sublease form; (iv) evidence
of insurance of the proposed assignee or subtenant complying with the
requirements of Exhibit D hereto; (v) a completed Environmental Questionnaire
from the proposed assignee or subtenant; and (vi) any other information
requested by Landlord and reasonably related to the transfer. Except as
provided in Subsection (c) of this Section, Landlord shall not unreasonably
withhold its consent, provided: (1) the use of the Premises will be
consistent with the provisions of this Lease and with Landlord's commitment
to other tenants of the Building and Project; (2) the proposed assignee or
subtenant has not been required by any prior landlord, lender or governmental
authority to take remedial action in connection with Hazardous Materials
contaminating a property arising out of the proposed assignee's or
subtenant's actions or use of the property in question and is not subject to
any enforcement order issued by any governmental authority in connection with
the use, disposal or storage of a Hazardous Material; (3) at Landlord's
election, insurance requirements shall be brought into conformity with
Landlord's then current leasing practice; (4) any proposed subtenant or
assignee demonstrates that it is financially responsible by submission to
Landlord of all reasonable information as Landlord may request concerning the
proposed subtenant or assignee, including, but not limited to, a balance sheet
of the proposed subtenant or assignee as of a date within ninety (90) days of
the request for Landlord's consent, statements of income or profit and loss
of the proposed subtenant or assignee for the two-year period preceding the
request for Landlord's consent, and/or a certification signed by the proposed
subtenant or assignee that it has not been evicted or been in arrears in
rent at any other leased premises for the 3-year period preceding the request
for Landlord's consent; (5) any proposed subtenant or assignee demonstrates
to Landlord's reasonable satisfaction a record of successful experience in
business; (6) the proposed assignee or subtenant is not an existing tenant of
the Building or Project or a prospect with whom Landlord is negotiating to
become a tenant at the Building or Project; and (7) the proposed transfer
will not impose additional burdens or adverse tax effects on Landlord. If
Tenant has any exterior sign rights under this Lease, such rights are
personal to Tenant and may not be assigned or transferred to any assignee of
this Lease or subtenant of the Premises without Landlord's prior written
consent, which may be withheld in Landlord's sole and absolute discretion.
If Landlord consents to the proposed transfer, Tenant may within ninety
(90) days after the date of the consent effect the transfer upon the terms
described in the information furnished to Landlord; provided that any
material change in the terms shall be subject to Landlord's consent as set
forth in this Section. Landlord shall approve or disapprove any requested
transfer within thirty (30) days following receipt of Tenant's written
request, the information set forth above, and the fee set forth below.
(c) Notwithstanding the provisions of Subsection (b) above, in lieu of
consenting to a proposed assignment or subletting, Landlord may elect to (i)
sublease the Premises (or the portion proposed to be subleased), or take an
assignment of Tenant's interest in this Lease, upon the same terms as offered
to the proposed subtenant or assignee (excluding terms relating to the
purchase of personal property, the use of Tenant's name or the continuation
of Tenant's business), or (ii) terminate this Lease as to the portion of the
Premises proposed to be subleased or assigned with a proportionate abatement
in the rent payable under this Lease, effective on the date that the proposed
sublease or assignment would have become effective. Landlord may thereafter,
at is option, assign or re-let any space so recaptured to any third party,
including, without limitation, the proposed transferee of Tenant.
(d) Tenant agrees that fifty percent (50%) of any amounts paid by the
assignee or subtenant, however described, in excess of (i) the Basic Rent
payable by Tenant hereunder, or in the case of a sublease of a portion of the
Premises, in excess of the Basic Rent reasonably allocable to such portion,
plus (ii) Tenant's direct out-of-pocket costs which Tenant certifies to
Landlord have been paid to provide occupancy related services to such
assignee or subtenant of a nature commonly provided by landlords of similar
space, shall be the property of Landlord and such
10
amounts shall be payable directly to Landlord by the assignee or subtenant
or, at Landlord's option, by Tenant. At Landlord's request, a written
agreement shall be entered into by and among Tenant, Landlord and the
proposed assignee or subtenant confirming the requirements of this subsection.
(e) Tenant shall pay to Landlord a fee of Five Hundred Dollars ($500.00)
if and when any transfer hereunder is requested by Tenant. Such fee is hereby
acknowledged as a reasonable amount to reimburse Landlord for its costs of
review and evaluation of a proposed assignee/sublessee, and Landlord shall
not be obligated to commence such review and evaluation unless and until such
fee is paid.
SECTION 9.2. EFFECT OF TRANSFER. No subletting or assignment, even with the
consent of Landlord, shall relieve Tenant of its obligation to pay rent and to
perform all its other obligations under this Lease. Moreover, Tenant shall
indemnify and hold Landlord harmless, as provided in Section 10.3, for any
act or omission by an assignee or subtenant. Each assignee, other than
Landlord, shall be deemed to assume all obligations of Tenant under this
Lease and shall be liable jointly and severally with Tenant for the payment
of all rent, and for the due performance of all of Tenant's obligations,
under this Lease. No transfer shall be binding on Landlord unless any
document memorializing the transfer is delivered to Landlord and both the
assignee/subtenant and Tenant deliver to Landlord an executed consent to
transfer instrument prepared by Landlord and consistent with the requirements
of this Article. The acceptance by Landlord of any payment due under this
Lease from any other person shall not be deemed to be a waiver by Landlord
of any provision of this Lease or to be a consent to any transfer. Consent
by Landlord to one or more transfers shall not operate as a waiver or
estoppel to the future enforcement by Landlord of its rights under this Lease.
SECTION 9.3. SUBLEASE REQUIREMENTS. The following terms and conditions
shall apply to any subletting by Tenant of all or any part of the Premises
and shall be deemed included in each sublease:
(a) Each and every provision contained in this Lease (other than with
respect to the payment of rent hereunder) is incorporated by reference into
and made a part of such sublease, with "Landlord" hereunder meaning the
sublandlord therein and "Tenant" hereunder meaning the subtenant therein.
(b) Tenant hereby irrevocably assigns to Landlord all of Tenant's
interest in all rentals and income arising from any sublease of the Premises,
and Landlord may collect such rent and income and apply same toward Tenant's
obligations under this Lease; provided, however, that until a default occurs
in the performance of Tenant's obligations under this Lease, Tenant shall
have the right to receive and collect the sublease rentals. Landlord shall
not, by reason of this assignment or the collection of sublease rentals, be
deemed liable to the subtenant for the performance of any of Tenant's
obligations under the sublease. Tenant hereby irrevocably authorizes and
directs any subtenant, upon receipt of a written notice from Landlord
stating that an uncured default exists in the performance of Tenant's
obligations under this Lease, to pay to Landlord all sums then and thereafter
due under the sublease. Tenant agrees that the subtenant may rely on that
notice without any duty of further inquiry and notwithstanding any notice or
claim by Tenant to the contrary. Tenant shall have no right or claim against
the subtenant or Landlord for any rentals so paid to Landlord.
(c) In the event of the termination of this Lease, Landlord may, at its
sole option, take over Tenant's entire interest in any sublease and, upon
notice from Landlord, the subtenant shall attorn to Landlord. In no event,
however, shall Landlord be liable for any previous act or omission by Tenant
under the sublease or for the return of any advance rental payments or
deposits under the sublease that have not been actually delivered to
Landlord, nor shall Landlord be bound by any sublease modification executed
without Landlord's consent or for any advance rental payment by the
subtenant in excess of one month's rent. The general provisions of this
Lease, including, without limitation, those pertaining to insurance and
indemnification, shall be deemed incorporated by reference into the sublease
despite the termination of this Lease.
SECTION 9.4. CERTAIN TRANSFERS. The sale of all or substantially all of
Tenant's assets (other than bulk sales in the ordinary course of business)
or, if Tenant is a corporation, an unincorporated association, or a
partnership, the transfer, assignment or hypothecation of any stock or
interest in such corporation, association, or partnership in the aggregate of
twenty-five percent (25%) (except for publicly traded shares of stock
constituting a transfer of twenty-five percent (25%) or more in the
aggregate, so long as no change in the controlling interest of Tenant occurs
as a result thereof) shall be deemed an assignment within the meaning and
provisions of this Article. Notwithstanding the foregoing, Landlord's consent
shall not be required for the assignment of this Lease as a result of a
merger by Tenant with or into another entity, so long as (i) the net worth of
the successor entity after such merger is at lease equal to the greater of
the net worth of Tenant as of the execution of this Lease by Landlord or the
net worth of Tenant immediately prior to the date of such merger, evidence of
which, satisfactory to Landlord, shall be presented to Landlord prior to such
merger, (ii) Tenant shall provide to Landlord, prior to such merger, written
notice of such merger and such assignment documentation and other information
as Landlord may request in connection therewith, and (iii) all of the other
terms and requirements of this Article shall apply with respect to such
assignment.
ARTICLE X. INSURANCE AND INDEMNITY
SECTION 10.1. TENANT'S INSURANCE. Tenant, at its sole cost and expense,
shall provide and maintain in effect the insurance described in EXHIBIT D.
Evidence of that insurance must be delivered to Landlord prior to the
Commencement Date.
SECTION 10.2. LANDLORD'S INSURANCE. Landlord may, at its election, provide
any or all of the following types of insurance, with or without deductible
and in amounts and coverages as may be determined by
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Landlord in its discretion: "all risk" property insurance, subject to
standard exclusions, covering the Building or Project, and such other risks
as Landlord or its mortgagees may from time to time deem appropriate,
including leasehold improvements made by Landlord, and commercial general
liability coverage. Landlord shall not be required to carry insurance of any
kind on Tenant's property, including leasehold improvements, trade fixtures,
furnishings, equipment, plate glass, signs and all other items of personal
property, and shall not be obligated to repair or replace that property
should damage occur. All proceeds of insurance maintained by Landlord upon
the Building and Project shall be the property of Landlord, whether or not
Landlord is obligated to or elects to make any repairs. At Landlord's option,
Landlord may self-insure all or any portion of the risks for which Landlord
elects to provide insurance hereunder.
SECTION 10.3. TENANT'S INDEMNITY. To the fullest extent permitted by law,
and unless and to the extent caused by Landlord's gross negligence or willful
misconduct, Tenant shall defend, indemnify, protect, save and hold harmless
Landlord, its agents, and any and all affiliates of Landlord, including,
without limitation, any corporations or other entities controlling,
controlled by or under common control with Landlord, from and against any and
all claims, liabilities, costs or expenses arising either before or after the
Commencement Date from Tenant's use or occupancy of the Premises, the
Building or the Common Areas, or from the conduct of its business, or from
any activity, work, or thing done, permitted or suffered by Tenant or its
agents, employees, invitees or licensees in or about the Premises, the
Building or the Common Areas, or from any default in the performance of any
obligation on Tenant's part to be performed under this Lease, or from any act
or negligence of Tenant or its agents, employees, invitees or licensees. If
the legal counsel retained by Tenant or its insurer to defend Landlord
reasonably determines he or she is legally precluded from representing both
Landlord and Tenant, Tenant shall, at Tenant's sole cost and expense, retain
separate counsel reasonably selected by Landlord to assume Landlord's defense
in any action covered by this Section through counsel reasonably satisfactory
to Landlord. The provisions of this Section shall expressly survive the
expiration or sooner termination of this Lease.
SECTION 10.4. LANDLORD'S NON-LIABILITY. Except to the extent a claim,
liability, cost or expense is caused solely by the gross negligence or
willful misconduct of Landlord, Landlord shall not be liable to Tenant, its
employees, agents and invitees, and Tenant hereby waives all claims against
Landlord for loss of or damage to any property, or any injury to any person,
or any other loss, cost, damage, injury or liability whatsoever resulting
from fire, explosion, falling plaster, steam, gas, electricity, water or rain
which may leak or flow from or into any part of the Building or from the
breakage, leakage, obstruction or other defects of the pipes, sprinklers,
wires, appliances, plumbing, air conditioning, electrical works or other
fixtures in the Building, whether the damage or injury results from
conditions arising in the Premises or in other portions of the Project.
Notwithstanding any provision of this Lease to the contrary, Landlord shall
in no event be liable to Tenant, its employees, agents or invitees and Tenant
hereby waives all claims against Landlord, for loss or interruption of
Tenant's business or income (including, without limitation, any consequential
damages and lost profit or opportunity costs), or for any loss, cost, damage,
injury or liability resulting from Acts of God (except with respect to
restoration obligations pursuant to Article XI below), acts of civil
disobedience or insurrection, acts or omissions (criminal or otherwise) of
any third parties, including, without limitation, any other tenants within
the Project or their agents, employees, contractors, guests or invitees. It
is understood that any such condition may require the temporary evacuation or
closure of all or a portion of the Building. Except as provided in Sections
11.1 and 12.1 below, there shall be no abatement of rent and no liability of
Landlord by reason of any injury to or interference with Tenant's business
(including, without limitation, consequential damages and lost profit or
opportunity costs) arising from the making of any repairs, alterations or
improvements to any portion of the Building, including repairs to the
Premises, nor shall any related activity by Landlord constitute an actual or
constructive eviction; provided, however, that in making repairs, alterations
or improvements, Landlord shall interfere as little as reasonably practicable
with the conduct of Tenant's business in the Premises. Neither Landlord nor
its agents shall be liable for interference with light or other similar
intangible interests. Tenant shall immediately notify Landlord in case of
fire or accident in the Premises, the Building or the Project and of defects
in any improvements or equipment.
SECTION 10.5. WAIVER OF SUBROGATION. Landlord and Tenant each hereby
waives all rights of recovery against the other and the other's agents on
account of loss and damage occasioned to the property of such waiving party
to the extent only that such loss or damage is required to be or is insured
against under any "all risk" property insurance policies required by this
Article X; provided however, that (i) the foregoing waiver shall not apply to
the extent of Tenant's obligations to pay deductibles under any such policies
and this Lease, and (ii) if any loss is due to the act, omission or
negligence or willful misconduct of Tenant or its agents, employees,
contractors, guests or invitees, Tenant's liability insurance shall be
primary and shall cover all losses and damages prior to any other insurance
hereunder. By this waiver it is the intent of the parties that neither
Landlord nor Tenant shall be liable to any insurance company (by way of
subrogation or otherwise) insuring the other party for any loss or damage
insured against under any "all-risk" property insurance policies required by
this Article, even though such loss or damage might be occasioned by the
negligence of such party, its agents, employees, contractors, guests or
invitees. The provisions of this Section shall not limit the indemnification
provisions elsewhere contained in this Lease.
ARTICLE XI. DAMAGE OR DESTRUCTION
SECTION 11.1. RESTORATION.
(a) If the Building of which the Premises are a part is damaged,
Landlord shall repair that damage as soon as reasonably possible, at its
expense, unless: (i) Landlord reasonably determines that the cost of repair
is not covered by Landlord's fire and extended coverage insurance plus such
additional amounts Tenant elects, at its option, to contribute, excluding
however the deductible (for which Tenant shall be responsible for Tenant's
Share); (ii) Landlord reasonably determines that the Premises cannot, with
reasonable diligence, be fully repaired by Landlord (or cannot be safely
repaired because of the presence of hazardous factors, including, without
limitation, Hazardous
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Materials, earthquake faults, and other similar dangers) within two hundred
seventy (270) days after the date of the damage; (iii) an event of default by
Tenant has occurred and is continuing at the time of such damage; or (iv)
the damage occurs during the final twelve (12) months of the Term. Should
Landlord elect not to repair the damage for one of the preceding reasons,
Landlord shall so notify Tenant in writing within sixty (60) days after the
damage occurs and this Lease shall terminate as of the date of that notice.
(b) Unless Landlord elects to terminate this Lease in accordance with
subsection (a) above, this Lease shall continue in effect for the remainder
of the Term; provided that so long as Tenant is not in default under this
Lease, if the damage is so extensive that Landlord reasonably determines that
the Premises cannot, with reasonable diligence, be repaired by Landlord (or
cannot be safely repaired because of the presence of hazardous factors,
earthquake faults, and other similar dangers) so as to allow Tenant's
substantial use and enjoyment of the Premises within two hundred seventy
(270) days after the date of damage, then Tenant may elect to terminate this
Lease by written notice to Landlord within the sixty (60) day period stated
in subsection (a).
(c) Commencing on the date of any damage to the Building, and ending on
the sooner of the date the damage is repaired or the date this Lease is
terminated, the rental to be paid under this Lease shall be abated in the
same proportion that the floor area of the Premises that is rendered
unusable by the damage from time to time bears to the total floor area of
the Premises, but only to the extent that any business interruption insurance
proceeds are received by Landlord therefor from Tenant's insurance described
in EXHIBIT D.
(d) In addition, the provisions of this Section shall not be deemed to
require Landlord to repair any improvements or fixtures that Tenant is
obligated to repair or insure pursuant to any other provision of this Lease.
(e) Tenant shall fully cooperate with Landlord in removing Tenant's
personal property and any debris from the Premises to facilitate all
inspections of the Premises and the making of any repairs. Notwithstanding
anything to the contrary contained in this Lease, if Landlord in good faith
believes there is a risk of injury to persons or damage to property from
entry into the Building or Premises following any damage or destruction
thereto, Landlord may restrict entry into the Building or the Premises by
Tenant, its employees, agents and contractors in a nondiscriminatory manner,
without being deemed to have violated Tenant's rights of quiet enjoyment to,
or made an unlawful detainer of, or evicted Tenant from, the Premises. Upon
request, Landlord shall consult with Tenant to determine if there are safe
methods of entry into the Building or the Premises solely in order to allow
Tenant to retrieve files, data in computers, and necessary inventory, subject
however to all indemnities and waivers of liability from Tenant to Landlord
contained in this Lease and any additional indemnities and waivers of
liability which Landlord may require.
SECTION 11.2. LEASE GOVERNS. Tenant agrees that the provisions of this
Lease, including, without limitation, Section 11.1, shall govern any damage
or destruction and shall accordingly supersede any contrary statute or
rule of law.
ARTICLE XII. EMINENT DOMAIN
SECTION 12.1. TOTAL OR PARTIAL TAKING. If all or a material of the Premises
is taken by any lawful authority by exercise of the right of eminent domain,
or sold to prevent a taking, either Tenant or Landlord may terminate this
Lease effective as of the date possession is required to be surrendered to
the authority. In the event title to a portion of the Building or Project,
other than the Premises, is taken or sold in lieu of taking, and if Landlord
elects to restore the Building in such a way as to alter the Premises
materially, either party may terminate this Lease, by written notice to the
other party, effective on the date vesting of title. In the event neither
party has elected to terminate this Lease as provided above, then Landlord
shall promptly, after receipt of a sufficient condemnation award, proceed to
restore the Premises to substantially their condition prior to the taking,
and a proportionate allowance shall be made to Tenant for the rent
corresponding to the time during which, and to the part of the Premises of
which, Tenant is deprived on account of the taking restoration. In the event
of a taking, Landlord shall be entitled to the entire amount of the
condemnation award without deduction for any estate or interest of Tenant;
provided that nothing in this Section shall be deemed to give Landlord any
interest in, or prevent Tenant from seeking any award against the taking
authority for, the taking of personal property and fixtures belonging to
Tenant or for relocation or business interruption expenses recoverable from
the taking authority.
SECTION 12.2. TEMPORARY TAKING. No temporary taking of the Premises shall
terminate this Lease or give Tenant any right to abatement of rent, and any
award specifically attributable to a temporary taking of the Premises shall
belong entirely to Tenant. A temporary taking shall be deemed to be a taking
of the use or occupancy of the Premises for a period of not to exceed one
hundred eighty (180) days.
SECTION 12.3. TAKING OF PARKING AREA. In the event there shall be a taking
of the parking area such that Landlord can no longer provide sufficient
parking to comply with this Lease, Landlord may substitute reasonably
equivalent parking in a location reasonably close to the Building; provided
that if Landlord fails to make that substitution within thirty (30) days
following the taking and if the taking materially impairs Tenant's use and
enjoyment of the Premises, Tenant may, at its option, terminate this Lease by
written notice to Landlord. If this Lease is not so terminated by Tenant,
there shall be no abatement of rent and this Lease shall continue in effect.
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ARTICLE XIII. SUBORDINATION; ESTOPPEL CERTIFICATE; FINANCIALS
SECTION 13.1.1 SUBORDINATION. At the option of Landlord, this Lease shall
be either superior or subordinate to all ground or underlying leases,
mortgages and deeds of trust, if any, which may hereafter affect the
Building, and to all renewals, modifications, consolidations, replacements
and extensions thereof; provided, that so long as Tenant is not in default
under this Lease, this Lease shall not be terminated or Tenant's quiet
enjoyment of the Premises disturbed in the event of termination of any such
ground or underlying lease, or the foreclosure of any such mortgage or deed of
trust, to which Tenant has subordinated this Lease pursuant to this Section.
In the event of a termination or foreclosure, Tenant shall become a tenant of
and attorn to the successor-in-interest to Landlord upon the same terms and
conditions as are contained in this Lease, and shall execute any instrument
reasonably required by Landlord's successor for that purpose. Tenant shall
also, upon written request of Landlord, execute and deliver all instruments
as may be required from time to time to subordinate the rights of Tenant under
this Lease to any ground or underlying lease or to the lien of any mortgage or
deed of trust (provided that such instruments include the nondisturbance and
attornment provisions set forth above), or, if requested by Landlord, to
subordinate, in whole or in part, any ground or underlying lease or the lien
of any mortgage or deed of trust to this Lease.
SECTION 13.2. ESTOPPEL CERTIFICATE.
(a) Tenant shall, at any time upon not less than ten (10) days prior
written notice from Landlord, execute, acknowledge and deliver to Landlord,
in any format that Landlord may reasonably require, a statement in writing (i)
certifying that this Lease is unmodified and in full force and effect (or, if
modified, stating the nature of the modification and certifying that this
Lease, as modified, is in full force and effect) and the dates to which the
rental, additional rent and other charges have been paid in advance, if any,
and (ii) acknowledging that, to Tenant's knowledge, there are no uncured
defaults on the part of Landlord, or specifying each default if any are
claimed, and (iii) setting forth all further information that Landlord may
reasonably require. Tenant's statement may be relied upon by any prospective
purchaser or encumbrancer of all or any portion of the Building or Project.
(b) Notwithstanding any other rights and remedies of Landlord, Tenant's
failure to deliver any estoppel statement within the provided time shall be
conclusive upon Tenant that (i) this Lease is in full force and effect,
without modification except as may be represented by Landlord, (ii) there are
no uncured defaults in Landlord's performance, and (iii) not more than one
month's rental has been paid in advance.
SECTION 13.3. FINANCIALS.
(a) Tenant shall deliver to Landlord, prior to the execution of this
Lease and thereafter at any time upon Landlord's request, Tenant's current
tax returns and financial statements, certified true, accurate and complete
by the chief financial officer of Tenant, including a balance sheet and profit
and loss statement for the most recent prior year (collectively, the
"Statements"), which Statements shall accurately and completely reflect the
financial condition of Tenant. Landlord agrees that it will keep the
Statements confidential, except that Landlord shall have the right to
deliver the same to any proposed purchaser of the Building or Project, and to
any encumbrancer of all or any portion of the Building or Project.
(b) Tenant acknowledges that Landlord is relying on the Statements in its
determination to enter into this Lease, and Tenant represents to Landlord,
which representation shall be deemed made on the date of this Lease and again
on the Commencement Date, that no material change in the financial condition
of Tenant, as reflected in the Statements, has occurred since the date Tenant
delivered the Statements to Landlord. The Statements are represented and
warranted by Tenant to be corrected and to accurately and fully reflect
Tenant's true financial condition as of the date of submission by any
Statement to Landlord.
ARTICLE XIV. DEFAULTS AND REMEDIES
SECTION 14.1. TENANT'S DEFAULTS. In addition to any other event of default
set forth in this Lease, the occurrence of any one or more of the following
events shall constitute a default by Tenant:
(a) The failure by Tenant to make any payment of rent or additional rent
required to be made by Tenant, as and when due, where the failure continues
for a period of three (3) days after written notice from Landlord to Tenant;
provided, however, that any such notice shall be in lieu of, and not in
addition to, any notice required under California Code of Civil Procedure
Section 1161 and 1161(a) as amended. For purposes of these default and
remedies provisions, the term "additional rent" shall be deemed to include all
amounts of any type whatsoever other than Basic Rent to be paid by Tenant
pursuant to the terms of this Lease.
(b) Assignment, sublease, encumbrance or other transfer of the Lease by
Tenant, either voluntarily or by operation of law, whether by judgment,
execution, transfer by intestacy or testacy, or other means, without the
prior written consent of Landlord.
(c) The discovery by Landlord that any financial statement provided by
Tenant, or by any affiliate, successor or guarantor of Tenant, was materially
false.
(d) The failure of Tenant to timely and fully provide any subordination
agreement, estoppel certificate or financial statements in accordance with
the requirements of Article XIII.
14
(e) The failure or inability by Tenant to observe or perform any of the
express or implied covenants or provisions of this Lease to be observed or
performed by Tenant, other than as specified in any other subsection of this
Section, where the failure continues for a period of thirty (30) days after
written notice from Landlord to Tenant or such shorter period as is specified
in any other provision of this Lease; provided, however, that any such
notice shall be in lieu of, and not in addition to, any notice required under
California Code of Civil Procedure Section 1161 and 1161(a) as amended.
However, if the nature of the failure is such that more than thirty (30) days
are reasonably required for its cure, then Tenant shall not be deemed to be
in default if Tenant commences the cure within thirty (30) days, and
thereafter diligently pursues the cure to completion.
(f) (i) The making by Tenant of any general assignment for the benefit
of creditors; (ii) the filing by or against Tenant of a petition to have
Tenant adjudged a Chapter 7 debtor under the Bankruptcy Code or to have debts
discharged or a petition for reorganization or arrangement under any law
relating to bankruptcy (unless, in the case of a petition filed against
Tenant, the same is dismissed within thirty (30) days); (iii) the appointment
of a trustee or receiver to take possession of substantially all of Tenant's
assets located at the Premises or of Tenant's interest in this Lease, if
possession is not restored to Tenant within thirty (30) days; (iv) the
attachment, execution or other judicial seizure of substantially all of
Tenant's assets located at the Premises or of Tenant's interest in this
Lease, where the seizure is not discharged within thirty (30) days; or
(v) Tenant's convening of a meeting of its creditors for the purpose of
effecting a moratorium upon or composition of its debts. Landlord shall not
be deemed to have knowledge of any event described in this subsection unless
notification in writing is received by Landlord, nor shall there be any
presumption attributable to Landlord of Tenant's insolvency. In the event
that any provision of this subsection is contrary to applicable law, the
provision shall be of no force or effect.
SECTION 14.2 LANDLORD'S REMEDIES.
(a) In the event of any default by Tenant, or in the event of the
abandonment of the Premises by Tenant, then in addition to any other
remedies available to Landlord, Landlord may exercise the following remedies:
(i) Landlord may terminate Tenant's right to possession of the
Premises by any lawful means, in which case this Lease shall terminate and
Tenant shall immediately surrender possession of the Premises to Landlord.
Such termination shall not affect any accrued obligations of Tenant under
this Lease. Upon termination, Landlord shall have the right to reenter the
Premises and remove all persons and property. Landlord shall also be entitled
to recover from Tenant:
(1) The worth at the time of award of the unpaid rent and
additional rent which had been earned at the time of termination;
(2) The worth at the time of award of the amount by which the
unpaid rent and additional rent which would have been earned after
termination until the time of award exceeds the amount of such loss that
Tenant proves could have been reasonably avoided;
(3) The worth at the time of award of the amount by which the
unpaid rent and additional rent for the balance of the Term after the time of
award exceeds the amount of such loss that Tenant proves could be reasonably
avoided;
(4) 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 which in the ordinary course of things would be likely to
result from Tenant's default, including, but not limited to, the cost of
recovering possession of the Premises, refurbishment of the Premises,
marketing costs, commissions and other expenses of reletting, including
necessary repair, the unamortized portion of any brokerage commissions funded
by Landlord in connection with this Lease, reasonable attorney's fees, and
any other reasonable costs; and
(5) At Landlord's election, all other amounts in addition to or
in lieu of the foregoing as may be permitted by law. The term "rent" as used
in this Lease shall be deemed to mean the Basic Rent and all other sums
required to be paid by Tenant to Landlord pursuant to the terms of this
Lease. Any sum, other than Basic Rent, shall be computed on the basis of the
average monthly amount accruing during the twenty-four (24) month period
immediately prior to default, except that if it becomes necessary to compute
such rental before the twenty-four (24) month period has occurred, then the
computation shall be on the basis of the average monthly amount during the
shorter period. As used in subparagraphs (1) and (2) above, the "worth at the
time of award" shall be computed by allowing interest at the rate of ten
percent (10%) per annum. As used in subparagraph (3) above, the "worth at the
time of award" shall be computed by discounting the amount at the discount
rate of the Federal Reserve Bank of San Francisco at the time of award plus
one percent (1%).
(ii) Landlord may elect not to terminate Tenant's right to possession
of the Premises, in which event Landlord may continue to enforce all of its
rights and remedies under this Lease, including the right to collect all rent
as it becomes due. Efforts by the Landlord to maintain, preserve or relet the
Premises, or the appointment of a receiver to protect the Landlord's
interests under this Lease, shall not constitute a termination of the
Tenant's right to possession of the Premises. In the event that Landlord
elects to avail itself of the remedy provided by this subsection (ii),
Landlord shall not unreasonably withhold its consent to an assignment or
subletting of the Premises subject to the reasonable standards for Landlord's
consent as are contained in this Lease.
(b) Landlord shall be under no obligation to observe or perform any
covenant of this Lease on its part to be observed or performed which accrues
after the date of any default by Tenant unless and until the default is cured
by Tenant, it being understood and agreed that the performance by Landlord of
its obligations under this Lease
15
are expressly conditioned upon Tenant's full and timely performance of its
obligations under this Lease. The various rights and remedies reserved to
Landlord in this Lease or otherwise shall be cumulative and, except as
otherwise provided by California law, Landlord may pursue any or all of its
rights and remedies at the same time.
(c) No delay or omission of Landlord to exercise any right or remedy
shall be construed as a waiver of the right or remedy or of any default by
Tenant. The acceptance by Landlord of rent shall not be a (i) waiver of any
preceding breach or default by Tenant of any provision of this Lease, other
than the failure of Tenant to pay the particular rent accepted, regardless
of Landlord's knowledge of the preceding breach or default at the time of
acceptance of rent, or (ii) a waiver of Landlord's right to exercise any
remedy available to Landlord by virtue of the breach or default. The
acceptance of any payment from a debtor in possession, a trustee, a receiver
or any other person acting on behalf of Tenant or Tenant's estate shall not
waive or cure a default under Section 14.1. No payment by Tenant or receipt
by Landlord of a lesser amount than the rent required by this Lease shall be
deemed to be other than a partial payment on account of the earliest due
stipulated rent, nor shall any endorsement or statement on any check or
letter be deemed an accord and satisfaction and Landlord shall accept the
check or payment without prejudice to Landlord's right to recover the balance
of the rent or pursue any other remedy available to it. No act or thing done
by Landlord or Landlord's agents during the Term shall be deemed an
acceptance of a surrender of the Premises, and no agreement to accept a
surrender shall be valid unless in writing and signed by Landlord. No
employee of Landlord or of Landlord's agents shall have any power to accept
the keys to the Premises prior to the termination of this Lease, and the
delivery of the keys to any employee shall not operate as a termination of
the Lease or a surrender of the Premises.
SECTION 14.3. LATE PAYMENTS.
(a) Any rent due under this Lease that is not received by Landlord
within five (5) days of the date when due shall bear interest at the maximum
rate permitted by law from the date due until fully paid. The payment of
interest shall not cure any default by Tenant under this Lease. In addition,
Tenant acknowledges that the late payment by Tenant to Landlord of rent will
cause Landlord to incur costs not contemplated by this Lease, the exact
amount of which will be extremely difficult and impracticable to ascertain.
Those costs may include, but are not limited to, administrative, processing
and accounting charges, and late charges which may be imposed on Landlord by
the terms of any ground lease, mortgage or trust deed covering the Premises.
Accordingly, if any rent due from Tenant shall not be received by Landlord or
Landlord's designee within five (5) days after the date due, then Tenant
shall pay to Landlord, in addition to the interest provided above, a late
charge in a sum equal to the greater of five percent (5%) of the amount
overdue or Two Hundred Fifty Dollars ($250.00) for each delinquent payment.
Acceptance of a late charge by Landlord shall not constitute a waiver of
Tenant's default with respect to the overdue amount, nor shall it prevent
Landlord from exercising any of its other rights and remedies.
(b) Following each second consecutive installment of rent that is not
paid within five (5) days following notice of nonpayment from Landlord,
Landlord shall have the option (i) to require that beginning with the first
payment of rent next due, rent shall no longer be paid in monthly
installments but shall be payable quarterly three (3) months in advance
and/or (ii) to require that Tenant increase the amount, if any, of the
Security Deposit by one hundred percent (100%). Should Tenant deliver to
Landlord, at any time during the Term, two (2) or more insufficient checks,
the Landlord may require that all monies then and thereafter due from Tenant
be paid to Landlord by cashier's check.
SECTION 14.4. RIGHT OF LANDLORD TO PERFORM. All covenants and agreements
to be performed by Tenant under this Lease shall be performed at Tenant's
sole cost and expense and without any abatement of rent or right of set-off.
If Tenant fails to pay any sum of money, other than rent, or fails to perform
any other act on its part to be performed under this Lease, and the failure
continues beyond any applicable grace period set forth in Section 14.1, then
in addition to any other available remedies, Landlord may, at its election
make the payment or perform the other act on Tenant's part. Landlord's
election to make the payment or perform the act on Tenant's part shall not
give rise to any responsibility of Landlord to continue making the same or
similar payments or performing the same or similar acts. Tenant shall,
promptly upon demand by Landlord, reimburse Landlord for all sums paid by
Landlord and all necessary incidental costs, together with interest at the
maximum rate permitted by law from the date of the payment by Landlord.
Landlord shall have the same rights and remedies if Tenant fails to pay those
amounts as Landlord would have in the event of a default by Tenant in the
payment of rent.
SECTION 14.5. DEFAULT BY LANDLORD. Landlord shall not be deemed to be in
default in the performance of any obligation under this Lease unless and
until it has failed to perform the obligation within thirty (30) days after
written notice by Tenant to Landlord specifying in reasonable detail the
nature and extent of the failure; provided, however, that if the nature of
Landlord's obligation is such that more than thirty (30) days are required
for its performance, then Landlord shall not be deemed to be in default if it
commences performance within the thirty (30) day period and thereafter
diligently pursues the cure to completion.
SECTION 14.6. EXPENSES AND LEGAL FEES. All sums reasonably incurred by
Landlord in connection with any event of default by Tenant under this Lease
or holding over of possession by Tenant after the expiration or earlier
termination of this Lease, including, without limitation, all costs, expenses
and actual accountants, appraisers, attorneys and other professional fees,
and any collection agency or other collection charges, shall be due and
payable by Tenant to Landlord on demand, and shall bear interest at the rate
of ten percent (10%) per annum. Should either Landlord or Tenant bring any
action in connection with this Lease, the prevailing party shall be entitled
to recover as a part of the action its reasonable attorneys' fees, and all
other costs. The prevailing party for the purpose of this paragraph shall be
determined by the trier of the facts.
SECTION 14.7. WAIVER OF JURY TRIAL. LANDLORD AND TENANT EACH ACKNOWLEDGES
THAT IT IS AWARE OF AND HAS HAD THE ADVICE OF COUNSEL OF ITS CHOICE WITH
RESPECT
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TO ITS RIGHTS TO TRIAL BY JURY, AND EACH PARTY DOES HEREBY EXPRESSLY AND
KNOWINGLY WAIVE AND RELEASE ALL SUCH RIGHTS TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER PARTY HERETO AGAINST THE OTHER
(AND/OR AGAINST ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, OR SUBSIDIARY OR
AFFILIATED ENTITIES) ON ANY MATTERS WHATSOEVER ARISING OUT OF OR IN ANY WAY
CONNECTED WITH THIS LEASE, TENANT'S USE OR OCCUPANCY OF THE PREMISES, AND/OR
ANY CLAIM OR INJURY OR DAMAGE.
SECTION 14.8. SATISFACTION OR JUDGMENT. The obligations of Landlord do not
constitute the personal obligations of the individual partners, trustees,
directors, officers or shareholders of Landlord or its constituent partners.
Should Tenant recover a money judgment against Landlord, such judgment shall
be satisfied only out of the proceeds of sale received upon execution of such
judgment and levied thereon against the right, title and interest of Landlord
in the Project and out of the rent or other income from such property
receivable by Landlord or out of consideration received by Landlord from the
sale or other disposition of all or any part of Landlord's right, title or
interest in the Project and no action for any deficiency may be sought or
obtained by Tenant.
SECTION 14.9. LIMITATION OF ACTIONS AGAINST LANDLORD. Any claim, demand or
right of any kind by Tenant which is based upon or arises in connection with
this Lease shall be barred unless Tenant commences an action thereon within
six (6) months after the date that the act, omission, event or default upon
which the claim, demand or right arises, has occurred.
ARTICLE XV. END OF TERM
SECTION 15.1. HOLDING OVER. This Lease shall terminate without further
notice upon the expiration of the Term, and any holding over by Tenant after
the expiration shall not constitute a renewal or extension of this Lease, or
give Tenant any rights under this Lease, except when in writing signed by
both parties. If Tenant holds over for any period after the expiration (or
earlier termination) of the Term without the prior written consent of
Landlord, such possession shall constitute a tenancy at sufferance only;
such holding over with the prior written consent of Landlord shall constitute
a month-to-month tenancy commencing on the first (1st) day following the
termination of this Lease. In either of such events, possession shall be
subject to all of the terms of this Lease, except that the monthly Basic
Rent shall be the greater of (a) two hundred percent (200%) of the Basic
Rent for the month immediately preceding the date of termination or (b) the
then currently scheduled Basic Rent for comparable space in the Building. If
Tenant fails to surrender the Premises upon the expiration of this Lease
despite demand to do so by Landlord, Tenant shall indemnify and hold Landlord
harmless from all loss or liability, including without limitation, any claims
made by any succeeding tenant relating to such failure to surrender.
Acceptance by Landlord of rent after the termination shall not constitute a
consent to a holdover or result in a renewal of this Lease. The foregoing
provisions of this Section are in addition to and do not affect Landlord's
right of re-entry or any other rights of Landlord under this Lease or at law.
SECTION 15.2. MERGER ON TERMINATION. The voluntary or other surrender of
this Lease by Tenant, or a mutual termination of this Lease, shall terminate
any or all existing subleases unless Landlord, at its option, elects in
writing to treat the surrender or termination as an assignment to it of any
or all subleases affecting the Premises.
SECTION 15.3. SURRENDER OF PREMISES; REMOVAL OF PROPERTY. Upon the
Expiration Date or upon any earlier termination of this Lease, Tenant shall
quit and surrender possession of the Premises to Landlord in as good order,
condition and repair as when received or as hereafter may be improved by
Landlord or Tenant, reasonable wear and tear and repairs which are Landlord's
obligation excepted, and shall, without expense to Landlord, remove or cause
to be removed from the Premises all personal property, improvements
constructed by Tenant that Landlord require to removed in accordance with the
terms of this Lease, and debris, except for any items or improvements that
Landlord may by written authorization allow to remain. Tenant shall repair all
damage to the Premises resulting from the removal, which repair shall include
the patching and filling of holes and repair of structural damage, provided
that Landlord may instead elect to repair any structural damage at Tenant's
expense. If Tenant shall fail to comply with the provisions of this Section,
Landlord may effect the removal and/or make any repairs, and the cost to
Landlord shall be additional rent payable by Tenant upon demand. If Tenant
fails to remove Tenant's personal property from the Premises upon the
expiration of the Term, Landlord may remove, store, dispose of and/or retain
such personal property, at Landlord's option, in accordance with then
applicable laws, all at the expense of Tenant. If requested by Landlord,
Tenant shall execute, acknowledge and deliver to Landlord an instrument in
writing releasing and quitclaiming to Landlord all right, title and interest
of Tenant in the Premises.
ARTICLE XVI. PAYMENTS AND NOTICES
All sums payable by Tenant to Landlord shall be paid, without deduction or
offset, in lawful money of the United States to Landlord at its address set
forth in Item 12 of the Basic Lease Provisions, or at any other place as
Landlord may designate in writing. Unless this Lease expressly provides
otherwise, as for example in the payment of rent pursuant to Section 4.1, all
payments shall be due and payable within five (5) days after demand. All
payments requiring proration shall be prorated on the basis of a thirty (30)
day month and a three hundred sixty (360) day year. Any notice, election,
demand, consent, approval or other communication to be given or other
document to be delivered by either party to the other may be delivered in
person or by courier or overnight delivery service to the other party, or
may be deposited in the United States mail, duly registered or certified,
postage prepaid, return receipt requested, and addressed to the other party at
the address set forth in Item 12 of the Basic Lease Provisions, or if to
Tenant, at that
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address or, from and after the Commencement Date, at the Premises (whether or
not Tenant has departed from, abandoned or vacated the Premises), or may be
delivered by telegram, telex or telecopy, provided that receipt thereof is
telephonically confirmed. Either party may, by written notice to the other,
served in the manner provided in this Article, designate a different dress.
If any notice or other document is sent by mail, it shall be deemed served or
delivered twenty-four (24) hours after mailing. If more than one person or
entity is named as Tenant under this Lease, service of any notice upon any
one of them shall be deemed as service upon all of them.
ARTICLE XVII. RULES AND REGULATIONS
Tenant agrees to observe faithfully and comply strictly with the Rules and
Regulations, attached as EXHIBIT E, and any reasonable and nondiscriminatory
amendments, modifications and/or additions as may be adopted and published by
written notice to tenants by Landlord for the safety, care, security, good
order, or cleanliness of the Premises, Building, Project and Common Areas.
Landlord shall not be liable to Tenant for any violation of the Rules and
Regulations or the breach of any covenant or condition in any lease by any
other tenant or such tenant's agents, employees, contractors, guests or
invitees. One or more waivers by Landlord of any breach of the Rules and
Regulations by Tenant or by any other tenant(s) shall not be a waiver of any
subsequent break of that rule or any other. Tenant's failure to keep and
observe the Rules and Regulations shall constitute a default under this
Lease. In the case of any conflict between the Rules and Regulations and this
Lease, this Lease shall be controlling.
ARTICLE XVIII. BROKER'S COMMISSION
The parties recognize as the broker(s) who negotiated this Lease the
firm(s), if any, whose name(s) is (are) stated in Item 10 of the Basic Lease
Provisions, and agree that Landlord shall be responsible for the payment of
brokerage commissions to those broker(s) unless otherwise provided in this
Lease. Tenant warrants that it has had no dealings with any other real estate
broker or agent in connection with the negotiation of this Lease, and Tenant
agrees to indemnify and hold Landlord harmless from any cost, expense or
liability (including reasonable attorneys' fees) for any compensation,
commissions or charges claimed by any other real estate broker or agent
employed or claiming to represent or to have been employed by Tenant in
connection with the negotiation of this Lease. The foregoing agreement shall
survive the termination of this Lease. If Tenant fails to take possession of
the Premises or if this Lease otherwise terminates prior to the Expiration
Date as the result of failure of performance by Tenant, Landlord shall be
entitled to recover from Tenant the unamortized portion of any brokerage
commission funded by Landlord in addition to any other damages to which
Landlord may be entitled.
ARTICLE XIX. TRANSFER OF LANDLORD'S INTERESTS
In the event of any transfer of Landlord's interest in the Premises, the
transferor shall be automatically relieved of all obligations on the part of
Landlord accruing under this Lease from and after the date of the transfer,
provided that any funds held by the transferor in which Tenant has an
interest shall be turned over, subject to that interest, to the transferee
and Tenant is notified of the transfer as required by law. No holder of a
mortgage and/or deed of trust to which this Lease is or may be subordinate,
and no landlord under a so-called sale-leaseback, shall be responsible in
connection with the Security Deposit, unless the mortgagee or holder of the
deed of trust or the landlord actually receives the Security Deposit. It is
intended that the covenants and obligation contained in this Lease on the
part of Landlord shall, subject to the foregoing, be binding on Landlord, its
successors and assigns, only during and in respect to their respective
successive periods of ownership.
ARTICLE XX. INTERPRETATION
SECTION 20.1. GENDER AND NUMBER. Whenever the context of this Lease
requires, the words "Landlord" and "Tenant" shall include the plural as well
as the singular, and words used in neuter, masculine or feminine genders
shall include the others.
SECTION 20.2. HEADINGS. The captions and headings of the articles and
sections of this Lease are for convenience only, are not a part of this Lease
and shall have no effect upon its construction or interpretation.
SECTION 20.3. JOINT AND SEVERAL LIABILITY. If more than one person or
entity is named as Tenant, the obligations imposed upon each shall be joint
and several and the act of or notice from, or notice or refund to, or the
signature of, any one or more of them shall be binding on all of them with
respect to the tenancy of this Lease, including, but not limited to, any
renewal, extension, termination or modification of this Lease.
SECTION 20.4. SUCCESSORS. Subject to Articles IX and XIX, all rights and
liabilities given to or imposed upon Landlord and Tenant shall extend to and
bind their respective heirs, executors, administrators, successors and
assigns. Nothing contained in this Section is intended, or shall be
construed, to grant to any person other than Landlord and Tenant and their
successors and assigns any rights or remedies under this Lease.
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SECTION 20.5. TIME OF ESSENCE. This is of the essence with respect to
the performance of every provision of this lease.
SECTION 20.6. CONTROLLING LAW. This Lease shall be governed by and
interpreted in accordance with the laws of the State of California.
SECTION 20.7. SEVERABILITY. If any term or provision of this Lease, the
deletion of which would not adversely affect the receipt of any material
benefit by either party or the deletion of which is consented to by the party
adversely affected, shall be held invalid or unenforceable to any extent, the
remainder of this Lease shall not be affected and each term and provision of
this Lease shall be valid and enforceable to the fullest extent permitted by
law.
SECTION 20.8. WAIVER AND CUMULATIVE REMEDIES. One or more waivers by
Landlord or Tenant of any breach of any term, covenant or condition contained
in this Lease shall not be a waiver of any subsequent breach of the same or
any other term, covenant or condition. Consent to any act by one of the
parties shall not be deemed to render unnecessary the obtaining of that
party's consent to any subsequent act. No breach by Tenant of this Lease
shall be deemed to have been waived by Landlord unless the waiver is in a
writing signed by Landlord. The rights and remedies of Landlord under this
Lease shall be cumulative and in addition to any and all other rights and
remedies which Landlord may have.
SECTION 20.9. INABILITY TO PERFORM. In the event that either party
shall be delayed or hindered in or prevented from the performance of any work
or in performing any act required under this Lease by reason of any cause
beyond the reasonable control of that party, then the performance of the work
or the doing of the act shall be excused for the period of the delay and the
time for performance shall be extended for a period equivalent to the period
of the delay. The provisions of this Section shall not operate to excuse
Tenant from the prompt payment of rent or from the timely performance of any
obligation under this Lease within Tenant's reasonable control.
SECTION 20.10. ENTIRE AGREEMENTS. This Lease and its exhibits and other
attachments cover in full each and every agreement of every kind between the
parties concerning the Premises, the Building, and the Project, and all
preliminary negotiations, oral agreements, understandings and/or practices,
except those contained in this Lease, are superseded and of no further
effect. Tenant waives its rights to rely on any representations or promises
made by Landlord or others which are not contained in this Lease. No verbal
agreement or implied covenant shall be held to modify the provisions of this
Lease, any statute, law, or custom to the contrary notwithstanding.
SECTION 20.11. QUIET ENJOYMENT. Upon the observance and performance of
all the covenants, terms and conditions on Tenant's part to be observed and
performed, and subject to the other provisions of this Lease, Tenant shall
peaceably and quietly hold and enjoy the Premises for the Term without
hindrance or interruption by Landlord or any other person claiming by or
through Landlord.
SECTION 20.12. SURVIVAL. All covenants of Landlord or Tenant which
reasonably would be intended to survive the expiration or sooner termination
of this Lease, including, without limitation, any warranty or indemnity
hereunder, shall so survive and continue to be binding upon and inure to the
benefit of the respective parties and their successors and assigns.
ARTICLE XXI. EXECUTION AND RECORDING
SECTION 21.1. COUNTERPARTS. This Lease may be executed in one or more
counterparts, each of which shall constitute an original and all of which
shall be one and the same agreement.
SECTION 21.2. CORPORATE AND PARTNERSHIP AUTHORITY. If Tenant is a
corporation or partnership, each individual executing this Lease on behalf of
the corporation or partnership represents and warrants that he is duly
authorized to execute and deliver this Lease on behalf of the corporation or
partnership, and that this Lease is binding upon the corporation or
partnership in accordance with its terms. Tenant shall, at Landlord's
request, deliver a certified copy of its board of directors' resolution or
partnership agreement or certificate authorizing or evidencing the execution
of this Lease.
SECTION 21.3. EXECUTION OF LEASE; NO OPTION OR OFFER. The submission of
this Lease to Tenant shall be for examination purposes only, and shall not
constitute an offer to or option for Tenant to lease the Premises. Execution
of this Lease by Tenant and its return to Landlord shall not be binding upon
Landlord, notwithstanding any time interval, until Landlord has in fact
executed and delivered this Lease to Tenant, it being intended that this
Lease shall only become effective upon execution by landlord and delivery of
a fully executed counterpart to Tenant.
SECTION 21.4. RECORDING. Tenant shall not record this Lease without the
prior written consent of Landlord. Tenant, upon the request of Landlord,
shall execute and acknowledge a "short form" memorandum of this Lease for
recording purposes.
SECTION 21.5. AMENDMENTS. No amendment or termination of this Lease
shall be effective unless in writing signed by authorized signatories of
Tenant and Landlord, or by their respective successors in interest. No
actions, policies, oral or informal arrangements, business dealings or other
course of conduct by or between the parties shall be deemed to modify this
Lease in any respect.
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SECTION 21.6. EXECUTED COPY. Any fully executed photocopy or similar
reproduction of this Lease shall be deemed an original for all purposes.
SECTION 21.7. ATTACHMENTS. All exhibits, amendments, riders and addenda
attached to this Lease are hereby incorporated into and made a part of this
Lease.
ARTICLE XXII. MISCELLANEOUS
SECTION 22.1. NONDISCLOSURE OF LEASE TERMS. Tenant acknowledges and agrees
that the terms of this Lease are confidential and constitute proprietary
information of Landlord. Disclosure of the terms could adversely affect the
ability of Landlord to negotiate other leases and impair Landlord's
relationship with other tenants. Accordingly, Tenant agrees that it, and its
partners, officers, directors, employees and attorneys, shall not
intentionally and voluntarily disclose the terms and conditions of this Lease
to any other tenant or apparent prospective tenant of the Building or
Project, either directly or indirectly, without the prior written consent of
Landlord, provided, however, that Tenant may disclose the terms to
prospective subtenants or assignees under this Lease.
SECTION 22.2. GUARANTY. As a condition to the execution of this Lease by
Landlord, the obligations, covenants and performance of the Tenant as herein
provided shall be guaranteed in writing by the Guarantor(s) listed in Item 7
of the Basic Lease Provisions, if any, on a form of guaranty provided by
Landlord.
SECTION 22.3. CHANGES REQUESTED BY LENDER. If, in connection with
obtaining financing for the Project, the lender shall request reasonable
modifications in this Lease as a condition to the financing, Tenant will not
unreasonably withhold or delay its consent, provided that the modifications
do not materially increase the obligations of Tenant or materially and
adversely affect the leasehold interest created by this Lease.
SECTION 22.4. MORTGAGEE PROTECTION. No act or failure to act on the part
of Landlord which would otherwise entitle Tenant to be relieved of its
obligations hereunder or to terminate this Lease shall result in such a
release or termination unless (a) Tenant has given notice by registered or
certified mail to any beneficiary of a deed of trust or mortgage covering the
Building whose address has been furnished to Tenant and (b) such beneficiary
is afforded a reasonable opportunity to cure the default by Landlord (which
in no event shall be less than sixty (60) days), including, if necessary to
effect the cure, time to obtain possession of the Building by power of sale
or judicial foreclosure provided that such foreclosure remedy is diligently
pursued. Tenant agrees that each beneficiary of a deed of trust or mortgage
covering the Building is an express third party beneficiary hereof, Tenant
shall have no right or claim for the collection of any deposit from such
beneficiary or from any purchaser at a foreclosure sale unless such
beneficiary or purchaser shall have actually received and not refunded the
deposit, and Tenant shall comply with any written directions by any
beneficiary to pay rent due hereunder directly to such beneficiary without
determining whether an event of default exists under such beneficiary's deed
of trust.
SECTION 22.5. COVENANTS AND CONDITIONS. All if the provisions of this
Lease shall be construed to be conditions as well as covenants as though the
words specifically expressing or imparting covenants and conditions were used
in each separate provision.
SECTION 22.6. SECURITY MEASURES. Tenants hereby acknowledges that Landlord
shall have no obligation whatsoever to provide guard service or other
security measures for the benefit of the Premises or the Project.
Tenant assumes all responsibility for the protection of Tenant, its agents,
invitees and property from acts of third parties. Nothing herein contained
shall prevent Landlord, at its sole option, from providing security
protection for the Project or any part thereof, in which event the cost
thereof shall be included within the definition of Project Costs.
SECTION 22.7. JAMS ARBITRATION.
(a) All claims or disputes between Landlord and Tenant arising out of,
or relating to the Lease which either party is expressly authorized by a
provision hereof to submit to arbitration, shall be decided by the
XXXXX/ENDISPUTE, or its successor, in Orange, California("JAMS"), unless the
parties mutually agree otherwise. Within ten (10) business days following
submission to JAMS, JAMS shall designate three arbitrators and each party
may, within five (5) business days thereafter, veto one of the three persons
so designated. If two different designated arbitrators have been vetoed,
the third arbitrator shall hear and decide the matter. Any arbitration
pursuant to this Section shall be decided within thirty (30) days of
submission of JAMS. The decision of the arbitrator shall be final and binding
on the parties. All costs associated with arbitration shall be awarded to the
prevailing party as determined by the arbitrator.
(b) Notice of the demand for arbitration by either party to the Lease
shall be filed in writing with the other party to the Lease and with JAMS and
shall be made within a reasonable time after the dispute has arisen. The
award rendered by the arbitrators shall be final, and judgement may be
entered upon it in accordance with applicable law in any court having
jurisdiction thereof. Except by written consent of the person or entity
sought to be joined, no arbitration arising out of or relating to the Lease
shall include, by consolidation, joinder or in any other manner, any person
or entity not a party to the Lease under which such arbitration is filed if
(1) such person or entity is substantially involved in a common question of
fact or law, (2) the presence of such person or entity is required if
complete relief is to be accorded in the arbitration, or (3) the interest or
responsibility of such person or entity in the matter is not insubstantial.
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(c) The agreement herein among the parties to the Lease and any other
written agreement to arbitrate referred to herein shall be specifically
enforceable under prevailing law.
LANDLORD: TENANT:
THE IRVINE COMPANY NEWGEN RESULTS CORPORATION,
a Delaware corporation
By: /s/ Xxxxxx X. Xxxxxxxx Xx. By: /s/ X.X. Xxxxx
------------------------------- -----------------------------------
Xxxxxx X. Xxxxxxxx, Xx. President Name: X.X. Xxxxx
Irvine Industrial Company ----------------------------
a division of The Irvine Company Title: Vice Pres. Sp. Proj.
---------------------------
By: /s/ Xxxxx X. Xxxxxxxx By: /s/ Xxx Xxxxxx
------------------------------- -----------------------------------
Xxxxx X. Xxxxxxxx Name: Xxx Xxxxxx
Assistant Secretary ----------------------------
Title: Sr. V.P., CFO
---------------------------
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