EXHIBIT 10.5a
FOURTH AMENDMENT TO LEASE
(801 LEASE)
This Fourth Amendment to Lease (this "Agreement") is entered into this 28
day of March, 1994, by and between Korry Electronics Co., a Delaware corporation
("Korry"), ▇▇▇▇▇▇▇▇▇ Technologies, Inc., a Delaware corporation ("Esterline"),
and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇"), a single man, acting individually and as
managing partner for the ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ general partnership.
RECITALS
▇. ▇▇▇▇▇▇▇'▇ predecessor, 801 Dexter Associates, and Korry's predecessor,
Criton Technologies ("CT"), a Delaware general partnership, entered into an
industrial lease agreement (the "Original Lease") dated July 17, 1974, under the
terms of which CT, as tenant, leased certain property (the "Premises") located
at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇. The lease has been amended by
three amendments, dated respectively May 10, 1985 (the "First Amendment"), June
20, 1986 (the "Second Amendment"), and September 1, 1987 (the "Third
Amendment"). The Original Lease, as amended by these three amendments, is
hereinafter designated as the "Amended Lease."
▇. ▇▇▇▇▇▇▇ succeeded to the landlord's interest under the Lease pursuant to
an assignment dated August 30, 1988. Korry succeeded to the lessee's interest
under the Lease pursuant to an assignment dated September 27, 1989, which
assignment has been and is hereby recognized and consented to by ▇▇▇▇▇▇▇ as
being effective as of September 27, 1989.
c. The parties wish to amend the Amended Lease under the terms and
conditions set forth below.
TERMS AND CONDITIONS
1. ▇▇▇▇▇▇▇▇▇'▇ Agreement to be Bound by Amended Lease. Esterline agrees to
be bound as tenant by all terms and covenants of the Amended Lease, including
this Agreement and any and all subsequent amendments or modifications to the
Amended Lease which Korry and Esterline sign hereafter.
2. Landlord's Maintenance Obligations. Paragraph 2 of the Third Amendment
is hereby deleted and replaced with the following, to be effective as of the
date of this Agreement:
The Landlord's maintenance and replacement obligations under the Lease
shall hereafter be limited to the costs of the maintenance of the utilities
located outside of the leased premises, the foundations, and the exterior
side of the exterior walls, and heat pump/compressor replacement costs;
provided, that the Tenant shall be solely responsible for paying the first
$5,000 of the costs incurred in the aggregate in connection with these
items during any Lease year (as that term is defined below), and Tenant and
Landlord shall each pay one-half of all additional costs incurred in
connection with these items in excess of $5,000 during each Lease year. As
used herein, the term "Lease year" means any period commencing with August
1 of any given year during which the Lease remains in effect and continuing
through July 31 of the following year or such earlier date as the Lease may
terminate.
3. Rental Adjustments. Paragraph 1.3 of the First Amendment is hereby
deleted and replaced with the following:
a. The monthly rent for the period 8/1/93 through 7/31/95 (the "Base
Period") is and shall continue to be $27,444.
b. The monthly rent for the two-year period 8/1/95 through 7/31/97 and
for each successive two-year period during the term of this lease shall be
equal to the monthly rent payable during the prior two-year period,
increased by a percentage equal to the percentage increase in the Index
(defined below) during the prior two-year period,up to a maximum percentage
increase of two and one-half percent in any one year, for a maximum of a
five percent increase for each two-year period.
c. As used herein, the term "Index" means the Consumer Price Index for
all Urban Consumers - All Items, for the Seattle MetropolitanArea, as
published by the U.S. Department of Labor's Bureau of Labor Statistics.
d. In addition to the rental adjustments described above, and not in
lieu thereof, a rent adjustment shall be made on August 1, 2001, which
shall be an amount equal to one-half of the sum of Monthly Excess Amounts
(defined below) computed at the end of each of the following two-year
periods: 8/1/93 through 7/31/95, 8/1/95 through 7/31/97, 8/1/97 through
7/31/99, and 8/1/99 through 7/31/01.
e. As used herein, the term "Monthly Excess Amount" means the
difference between (a) the monthly rent increase that would have been made
for the upcoming two-year period if the two and one-half percent annual
limit were not in effect, and (b) the monthly rent
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increase actually payable (i.e., with the two and one-half percent annual
limit in effect).
f. In addition to the rental adjustments described above, and not in
lieu thereof, a rent adjustment shall be made on August 1, 2005, which
shall be an amount equal to one-half of the sum of the Monthly Excess
Amounts computed at the end of each of these two-year periods: 8/1/01
through 7/31/03 and 8/1/03 through 7/31/05.
g. By way of illustration only, if the Index were to increase by four
percent during the first twelve months of the Base Period and one percent
during the second twelve months of the Base Period, the monthly rent for
the following two-year period (8/1/95 through 7/31/97) would be $28,404.54
(i.e., the Base Period monthly rent of $27,444 plus three and one-half
percent of $27,444, or $960.54, based on the two and one-half percent limit
for the first twelve months and the actual one percent increase during the
second twelve months). The Monthly Excess Rent at the end of the Base
Period would be $411.66 (calculated by multiplying the Base Period monthly
rent of $27,444 by one and one-half percent, or .015, which is the
difference between the five percent increase in the Index during the Base
Period and the three and one-half percent increase actually applied to the
rent adjustment for the following period.) The Monthly Excess Amount for
the period from 8/1/95 through 7/31/97 would be calculated based on a
beginning monthly rent of $28,404.54. A similar calculation will be made
for each successive two-year period.
h. If the Index is discontinued, the parties shall substitute a
comparable index of consumer prices.
4. Term of Occupancy; Last Month's Rent. The Lease term is hereby extended
to July 31, 2011, and Tenant shall have the sole and exclusive right to peaceful
and quiet enjoyment of the Premises, and to occupy the Premises without
interruption or interference for the entire remainder of the term as extended
hereby. However, Tenant shall have the right to terminate the Lease at any time
by giving written notice to Landlord at least two years in advance of the
termination date. Tenant shall not be liable for any obligations arising under
or in connection with the Lease following the date specified as the termination
date. ▇▇▇▇▇▇▇, ▇▇▇▇▇, and Esterline agree that a termination notice shall be
binding and no party will apply to a Court in equity or otherwise to extend the
term of the Amended Lease beyond the date specified in the termination notice.
The parties recognize ▇▇▇▇▇▇▇ is not holding the last month's rent. Upon
termination of the Amended Lease no rent prepaid prior to the date of this
Agreement will be returned.
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5. Improvements to the Property. Paragraph 7.5(a) of the Original Lease is
hereby deleted and replaced by the following:
a. Tenant shall not make any alterations, improvements, or additions
in, on, or about the Premises, except (i) non-structural alterations not
exceeding $5,000 in cost and/or (ii) in the case of an emergency, to
protect life or property, without first obtaining Landlord's consent, which
consent shall not be unreasonably withheld. As a condition of giving such
consent, Landlord may require Tenant to remove any such alterations,
improvements, additions, or utility installations hereafter installed at
the expiration of the Lease term or any prior termination thereof, and to
restore the Premises to their condition just prior to making the requested
alteration, improvement, or addition. Landlord's consent to Tenant's
request for such consent shall be implied as given, and Tenant shall be
entitled to make such alterations, improvements, or additions as have been
described in a notice issued to Landlord, if Landlord does not object to
the alter- ations, improvements, or additions within fifteen days after
actual receipt of such notice from Tenant. Notice and objections under this
paragraph must be made in accordance with the notice provisions of
paragraph 6 of this Agreement; provided, however, that the requirement of
receipt of any fifteen-day notice sent by Tenant may be met by actual
receipt of the notice by either of the notice recipients for Landlord
identified in paragraph 6.a. of this Agreement, rather than both.
b. Any and all requests for alterations, improvements, or additions
affecting exterior or load bearing walls or the foundation of the building
located on the Premises, or which involve cutting holes through floors in
the building, shall be accompanied by a writing from a licensed structural
engineer, certifying that, in the opinion of the structural engineer, the
structural integrity of the building would not be impaired by the proposed
alterations, improvements, or additions.
6. Notices. Paragraph 19 of the Original Lease is hereby deleted and
replaced by the following:
a. Notice Addresses. Any notice, keys, drawings, or other item or
items that may or shall be delivered pursuant to the terms of this Lease
shall be delivered to the following addresses:
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If to Landlord, to both of the following:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ & Cleveland
Suite 3400, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
If to Tenant, to both of the following:
Korry Electronics Co.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Director of Finance
▇▇▇▇▇▇▇▇▇ Technologies, Inc.
▇▇▇▇▇ ▇.▇. ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
b. Form of Notice and Delivery. Any and all notices shall be in
writing and either delivered by hand or mailed, via certified United States
mail, postage prepaid, to the addresses of the respective recipient as set
forth above. Delivery shall be deemed complete and effective upon receipt
by the recipient or upon the third business day following mailing,
whichever shall first occur.
c. Covenant to Accept Notice. No party shall refuse or otherwise
attempt to avoid delivery of any notice.
d. Change of Notice Address. Any party may change its notice address
by giving written notice of a new address in accordance with the foregoing
notice provisions.
7. Continuation of Unmodified Terms. Except as modified by this Agreement,
the terms of the Amended Lease remain in full force and effect. In the event of
conflict or inconsistency between the provisions of the Amended Lease and the
provisions of this Agreement, this Agreement will control.
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8. Binding Effect. The terms and conditions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, successors, personal representatives, and permitted assigns.
9. Entire Agreement. This Agreement contains the entire understanding
between and among the undersigned parties in connection with the subject matter
addressed herein. It supersedes and replaces any and all prior negotiations,
agreements, discussions, representations, statements and promises, whether oral
or written. Each party hereby acknowledges that no promise, representa- tion or
warranty whatsoever, express or implied, has been made by any other party or
agent or attorney of any other party to induce it to execute this document,
other than the terms expressly stated in this written Agreement.
10. Construction of this Agreement.
a. This Agreement shall be governed by and construed in accordance
with the laws of the State of Washington.
b. The paragraph headings used in this Agreement are inserted for
convenience only and are not intended to be a part of this Agreement or to
affect its construction.
c. When used in this Agreement, terms such as "herein," "hereto," and
"hereof" refer to the entire Agreement, and are not limited to any portion
or portions hereof.
d. This Agreement has been negotiated by counsel for all parties, and
the language hereof, including without limitation any ambiguities, shall
not be construed in favor of any one or more parties or against any one or
more other parties.
e. Time is of the essence in this Agreement.
f. This Agreement is exclusively for the benefit of the undersigned
parties, and no intent to benefit any third person or entity shall be
inferred, implied, or presumed in construing this Agreement.
11. Signing Authority. Each of the individuals signing below on behalf of
Korry and Esterline hereby warrants that he is authorized to sign this Agreement
on that party's behalf and that his signature binds that party.
▇▇▇▇▇▇▇ hereby warrants that he is authorized to sign this Agreement on
behalf of the ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ partnership as well as on his own behalf, and
that he and the partnership are bound thereby.
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Dated the day and year first set forth above.
KORRY ELECTRONICS CO. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
by /s/ ▇▇▇▇▇ ▇▇▇▇▇▇ by /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, individually
President and as managing partner of
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, a general
partnership
▇▇▇▇▇▇▇▇▇ TECHNOLOGIES, INC.
by /s/ ▇. ▇. ▇▇▇▇▇▇▇▇▇
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▇. ▇. ▇▇▇▇▇▇▇▇▇
Chief Financial Officer
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