EXHIBIT 10.13
[LETTERHEAD]
Tuesday, August 10, 1999
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ Family Trust
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
RE: ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇
Exercise of First Option to Extend
Dear ▇▇▇▇:
As a matter of record, Specialty Laboratories Inc. and the Salenger Trust have
extended the term of the lease by exercising Option #1 of said lease dated July
17, 1993 for an additional Four (4) year term from July 1, 1999 - June 30, 2003.
The base monthly rental is fixed for the extended term at $39,240.00 per month
triple net.
In addition, Specialty Laboratories Inc. and the Salenger Family Trust
acknowledge Option #2 dated November 20, 1998 which has been attached and is
part of the lease dated July 17, 1993. Option #2 grants Specialty Laboratories
Inc. the future ability to further extend the term of the lease for an
additional five year period from July 1, 2003 - June 30, 2008. If Specialty
Laboratories Inc. elects to extend the term of the lease for the Option #2
period (July 1, 2003 - June 30, 2008), Specialty Laboratories agrees to follow
said terms outlined in the Option #2 document.
AGREED AND ACCEPTED:
Specialty Laboratories, Inc.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ Date: 8/10/99
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▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇
Chairman
Salenger Family Trust
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇ Date: 8/14/99
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▇▇▇▇ ▇▇▇▇▇▇▇▇
[LOGO]
ADDENDUM TO
STANDARD INDUSTRIAL LEASE
DATED NOVEMBER 20, 1998
BY AND BETWEEN SPECIALTY LABORATORIES, INC. "LESSEE" AND
▇▇▇▇▇ AND ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ TRUST "LESSOR"
2nd OPTION TO EXTEND
A. Lessor hereby grants to Lessee the option to extend the term of this Lease
for a FIVE (5) year period commencing when the prior term expires upon each and
all of the following terms and conditions:
(i) Lessee gives to Lessor, and ▇▇▇▇▇▇ actually receives, on a date
which is prior to the date that the option period would commence (if
exercised) by at least six (6) months written notice of the exercise of the
option to extend this lease for said additional term, time being of the
essence. If said notification of the exercise of said option is not so given
and received, this option shall automatically expire;
(ii) The provisions of paragraph 39, including the provision relating to
default of Lessee set forth in paragraph 39.4 of this Lease are conditions of
this Option;
(iii) All of the terms and conditions of this Lease except where
specifically modified by this option shall apply;
(iv) The monthly rent for each month of the option period shall be
calculated as follows:
1. OPTION PERIOD BASE RENT:
Within 30 days of ▇▇▇▇▇▇'s written notice of ▇▇▇▇▇▇'s exercising the
option, ▇▇▇▇▇▇ shall deliver in writing to Lessee the new monthly Base
Rent for the space. Lessee's new monthly Base Rent for the option
period shall be the then prevailing market rate for similar buildings
and similar space in the Santa ▇▇▇▇▇▇ area. In the event Lessor does
not receive written objection to the new monthly Base Rent within 10
business days from written notification from Lessor then Lessee shall
have deemed to accept the new monthly Base Rent.
In the event the Lessee does object to the new monthly Base Rent then
Lessee shall submit in writing along with the written objection the
amount that ▇▇▇▇▇▇ proposes to be the correct new monthly Base Rent
for the space based upon rates for similar buildings and space in the
Santa ▇▇▇▇▇▇ area. Lessor shall respond in writing within 10 days from
receipt of ▇▇▇▇▇▇'s proposed new monthly Base Rent Lessor's
agreement, or objection, to the proposed amount.
In the event Lessor objects to ▇▇▇▇▇▇'s proposed new monthly Base Rent
then, within 30 days from Lessor's written objection, Lessor and the
Lessee shall mutually agree upon and hire an MAI Appraiser to
determine the new monthly Base Rent. The cost of the appraisal shall
be shared equally between Lessor and Lessee. The Appraiser's
determination of the monthly Base Rent shall be binding on both Lessor
and Lessee without any right of appeal.
This new base rent for each option period shall remain fixed for the
term of the option.
AGREED AND ACCEPTED:
TENANT:
SPECIALTY LABORATORIES, INC.
BY: ▇▇▇▇▇ ▇. ▇▇▇▇▇ DATE: 11/24/98
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ITS: Chairman
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LANDLORD:
OSCAR & ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ TRUST
BY: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇ DATE: 12/31/98
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ITS: Trustee
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STANDARD INDUSTRIAL LEASE -- NET
AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION
[LOGO]
1. PARTIES. This Lease, dated, for reference purposes only, July 17, 1993, is
made by and between ▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Trust (herein called "Lessor") and
Specialty Laboratories Inc. (herein called "Lessee").
2. PREMISES. Lessor hereby leases to Lessee and Lessee leases from Lessor for
the term, at the rental, and upon all of the conditions set forth herein, that
certain real property situated in the County of Los Angeles State of California,
commonly known as ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ and described as a
building containing approximately 36,000 square feet together with an adjacent
parking lot for approximately 120 automobiles. Said real property including the
land and all improvements therein, is herein called "the Premises".
3. TERM.
3.1 TERM. The term of this Lease shall be for Six (6) Years commencing on
July 1, 1993 and ending on June 30, 1999 unless sooner terminated pursuant to
any provision hereof.
3.2 DELAY IN POSSESSION. Notwithstanding said commencement date, if for any
reason Lessor cannot deliver possession of the Premises to Lessee on said date,
Lessor shall not be subject to any liability therefor, nor shall such failure
affect the validity of this Lease or the obligations of Lessee hereunder or
extend the term hereof, but in such case, Lessee shall not be obligated to pay
rent until possession of the Premises is tendered to Lessee; provided, however,
that if Lessor shall not have delivered possession of the Premises within sixty
(60) days from said commencement date, Lessee may, at ▇▇▇▇▇▇'s option, by notice
in writing to Lessor within ten (10) days thereafter, cancel this Lease, in
which event the parties shall be discharged from all obligations hereunder;
provided further, however, that if such written notice of ▇▇▇▇▇▇ is not received
by ▇▇▇▇▇▇ within said ten (10) day period, ▇▇▇▇▇▇'s right to cancel this Lease
hereunder shall terminate and be of no further force or effect.
3.3 EARLY POSSESSION. If Lessee occupies the Premises prior to said
commencement date, such occupancy shall be subject to all provisions hereof,
such occupancy shall not advance the termination date, and Lessee shall pay rent
for such period at the initial monthly rates set forth below.
4. RENT. Lessee shall pay to Lessor as rent for the Premises, monthly payments
of $36,000.00, in advance, on the 1st day of each month of the term hereof.
Lessee shall pay Lessor upon the execution hereof $36,000.00 as rent for July
1993. The base rent for the initial lease term shall not be increased. The new
monthly base rent as provided for in the Option Period To Extend shall not be
increased. See Addendum #4. Rent for any period during the term hereof which is
for less than one month shall be a pro rata portion of the monthly installment.
Rent shall be payable in lawful money of the United States to Lessor at the
address stated herein or to such other persons or at such other places as Lessor
may designate in writing.
5. SECURITY DEPOSIT. Lessee shall deposit with Lessor upon execution hereof
$97,200.00 as security for ▇▇▇▇▇▇'s faithful performance of ▇▇▇▇▇▇'s
obligations hereunder. If Lessee fails to pay rent or other charges due
hereunder, or otherwise defaults with respect to any provision of this Lease,
Lessor may use, apply or retain all or any portion of said deposit for the
payment of any rent or other charge in default or for the payment of any
other sum to which Lessor may become obligated by reason of ▇▇▇▇▇▇'s default,
or to compensate Lessor for any loss or damage which Lessor may suffer
thereby. If Lessor so uses or applies all or any portion of said deposit,
Lessee shall within ten (10) days after written demand therefor deposit cash
with Lessor in an amount sufficient to restore said deposit to the full
amount hereinabove stated and ▇▇▇▇▇▇'s failure to do so shall be a material
breach of this Lease. Lessor shall not be required to keep said deposit
separate from its general accounts. If ▇▇▇▇▇▇ performs all of ▇▇▇▇▇▇'s
obligations hereunder, said deposit, or so much thereof as has not
theretofore been applied by Lessor, shall be returned, without payment of
interest or other increment for its use, to Lessee (or, at Lessor's option,
to the last assignee, if any, of ▇▇▇▇▇▇'s interest hereunder) at the
expiration of the term hereof, and after ▇▇▇▇▇▇ has vacated the Premises. No
trust relationship is created herein between ▇▇▇▇▇▇ and ▇▇▇▇▇▇ with respect
to said Security Deposit. See Addendum #5.
6. USE.
6.1 USE. The Premises shall be used and occupied only for Medical
Laboratory or any other use authorized by law, or any other use which is
reasonably comparable and for no other purpose.
6.2 COMPLIANCE WITH LAW.
(a) Lessor warrants to Lessee that the Premises, in its state existing
on the date that the Lease term commences, but without regard to the use for
which Lessee will use the Premises, does not violate any covenants or
restrictions of record, or any applicable building code, regulation or ordinance
in effect on such Lease term commencement date. In the event it is determined
that this warranty has been violated, then it shall be the obligation of the
Lessor, after written notice from Lessee, to promptly, at Lessor's sole cost and
expense, rectify any such violation. In the event Lessee does not give to Lessor
written notice of the violation of this warranty within six months from the date
that the Lease term commences, the correction of same shall be the obligation of
the Lessee at Lessee's sole cost. The warranty contained in this paragraph
6.2(a) shall be of no force or effect if, prior to the date of this Lease,
Lessee was the owner or occupant of the Premises, and, in such event, Lessee
shall correct any such violation at Lessee's sole cost.
(b) Except as provided in paragraph 6.2(a), Lessee shall, at ▇▇▇▇▇▇'s
expense, comply promptly with all applicable statutes, ordinances, rules,
regulations, orders, covenants and restrictions of record, and requirements in
effect during the term or any part of the term hereof, regulating the use by
Lessee of the Premises. Lessee shall not use nor permit the use of the Premises
in any manner that will tend to create waste or a nuisance or, if there shall be
more than one tenant in the building containing the Premises, shall tend to
disturb such other tenants.
6.3 CONDITION OF PREMISES.
(a) Lessor shall deliver the Premises to Lessee in an as is condition.
(b) Except as otherwise provided in this Lease, Lessee hereby accepts
the Premises in their condition existing as of the Lease commencement date or
the date that Lessee takes possession of the Premises, whichever is earlier,
subject to all applicable zoning, municipal, county and state laws, ordinances
and regulations governing and regulating the use of the Premises, and any
covenants or restrictions of record, and accepts this Lease subject thereto and
to all matters disclosed thereby and by any exhibits attached hereto. ▇▇▇▇▇▇
acknowledges that neither Lessor nor ▇▇▇▇▇▇'s agent has made any representation
or warranty as to the present or future suitability of the Premises for the
conduct of ▇▇▇▇▇▇'s business.
7. MAINTENANCE, REPAIRS AND ALTERATIONS.
7.1 LESSEE'S OBLIGATIONS. Lessee shall keep in good order, condition and
repair the Premises and every part thereof, structural and non-structural,
(whether or not such portion of the Premises requiring repair, or the means
of repairing the same are reasonably or readily accessible to Lessee, and
whether or not the need for such repairs occurs as a result of Lessee's use,
any prior use, the elements or the age of such portion of the Premises)
including, without limiting the generality of the foregoing, all plumbing,
heating, air conditioning, (Lessee shall procure and maintain, at Lessee's
expense, an air conditioning system maintenance contract) ventilating,
electrical, lighting facilities and equipment within the Premises, fixtures,
walls (interior and exterior), foundations, ceilings, roofs (interior and
exterior), floors, windows, doors, plate glass and skylights located within
the Premises, and all landscaping, driveways, parking lots, fences and signs
located on the Premises and sidewalks and parkways adjacent to the Premises.
7.2 SURRENDER. On the last day of the term hereof, or on any sooner
termination, ▇▇▇▇▇▇ shall surrender the Premises to Lessor in the same condition
as when received, ordinary wear and tear excepted, clean and free of debris.
Lessee shall repair any damage to the Premises occasioned
Initials: [ILLEGIBLE]
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[ILLEGIBLE]
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by the installation or removal of ▇▇▇▇▇▇'s trade fixtures, furnishings and
equipment. Notwithstanding anything to the contrary otherwise stated in this
Lease, Lessee shall leave the air lines, power panels, electrical distribution
systems, lighting fixtures, space heaters, air conditioning, plumbing and
fencing on the premises in good operating condition.
7.3 LESSOR'S RIGHTS. If Lessee fails to perform Lessee's obligations under
this Paragraph 7, or under any other paragraph of this Lease, Lessor may at its
option (but shall not be required to) enter upon the Premises after ten (10)
days' prior written notice to Lessee (except in the case of an emergency, in
which case no notice shall be required), perform such obligations on Lessee's
behalf and put the same in good order, condition and repair, and the cost
thereof together with interest thereon at the maximum rate then allowable by law
shall become due and payable as additional rental to Lessor together with
▇▇▇▇▇▇'s next rental installment.
7.4 LESSOR'S OBLIGATIONS. Except for the obligations of Lessor under
Paragraph 6.2(a) and 6.3(a) (relating to Lessor's warranty), Paragraph 9
(relating to destruction of the Premises) and under Paragraph 14 (relating to
condemnation of the Premises), it is intended by the parties hereto that Lessor
have no obligation, in any manner whatsoever, to repair and maintain the
Premises nor the building located thereon nor the equipment therein, whether
structural or non-structural, all of which obligations are intended to be that
of the Lessee under Paragraph 7.1 hereof. Lessee expressly waives the benefit of
any statute now or hereinafter in effect which would otherwise afford Lessee the
right to make repairs at Lessor's expense or to terminate this Lease because of
Lessor's failure to keep the premises in good order, condition and repair.
*except exterior walls & foundations
7.5 ALTERATIONS AND ADDITIONS.
(a) Lessee shall not, without ▇▇▇▇▇▇'s prior written consent make
any alterations, improvements, additions, or Utility Installations in, on or
about the Premises, except for nonstructural alterations, not exceeding
$2,500 in cumulative costs during the term of this Lease. In any event,
whether or not in excess of $2,500 in cumulative cost, Lessee shall make no
change or alteration to the exterior of the Premises nor the exterior of the
building(s) on the Premises without ▇▇▇▇▇▇'s prior written consent. As used
in this Paragraph 7.5 the term "Utility Installation" shall mean carpeting,
window coverings, air lines, power panels, electrical distribution systems,
lighting fixtures, space heaters, air conditioning, plumbing, and fencing.
Lessor may require that Lessee remove any or all of said alterations,
improvements, additions or Utility Installations at the expiration of the
term, and restore the Premises to their prior condition. Lessor may require
Lessee to provide Lessor, at ▇▇▇▇▇▇'s sole cost and expense, a lien and
completion bond in an amount equal to one and one half times the estimated
cost of such improvements, to insure Lessor against any liability for
mechanic's and materialmen's liens and to insure completion of the work.
Should Lessee make any alterations, improvements, additions or Utility
Installations without the prior approval of Lessor, Lessor may require that
Lessee remove any or all of the same.
(b) Any alterations, improvements, additions or Utility Installations
in, or about the Premises that Lessee shall desire to make and which requires
the consent of the Lessor shall be presented to Lessor in written form, with
proposed detailed plans. If Lessor shall give its consent, the consent shall be
deemed conditioned upon Lessee acquiring a permit to do so from appropriate
governmental agencies, the furnishing of a copy thereof to Lessor prior to the
commencement of the work and the compliance by Lessee of all conditions of said
permit in a prompt and expeditious manner.
(c) Lessee shall pay, when due, all claims for labor or materials
furnished or alleged to have been furnished to or for Lessee at or for use in
the Premises, which claims are or may be secured by any mechanics' or
materialmen's lien against the Premises or any interest therein. Lessee shall
give Lessor not less than ten (10) days' notice prior to the commencement of
any work in the Premises, and Lessor shall have the right to post notices of
non-responsibility in or on the Premises as provided by law. If Lessee shall,
in good faith, contest the validity of any such lien, claim or demand, then
Lessee shall, at its sole expense defend itself and Lessor against the same
and shall pay and satisfy any such adverse judgment that may be rendered
thereon before the enforcement thereof against the Lessor or the Premises,
upon the condition that if Lessor shall require, Lessee shall furnish to
Lessor a surety bond satisfactory to Lessor in an amount equal to such
contested lien claim or demand indemnifying Lessor against liability for the
same and holding the Premises free from the effect of such lien or claim. In
addition, Lessor may require Lessee to pay Lessor's attorneys fees and costs
in participating in such action if Lessor shall decide it is to its best
interest to do so.
(d) Unless Lessor requires their removal, as set forth in Paragraph
7.5(a), all alterations, improvements, additions and Utility Installations
(whether or not such Utility Installations constitute trade fixtures of Lessee),
which may be made on the Premises, shall become the property of Lessor and
remain upon and be surrendered with the Premises at the expiration of the term.
Notwithstanding the provisions of this Paragraph 7.5(d), Lessee's machinery and
equipment, other than that which is affixed to the Premises so that it cannot be
removed without material damage to the Premises, shall remain the property of
▇▇▇▇▇▇ and may be removed by Lessee subject to the provisions of Paragraph 7.2.
8. INSURANCE INDEMNITY.
8.1 INSURING PARTY. As used in this Paragraph 8, the term "insuring
party" shall mean the party who has the obligation to obtain the Property
Insurance required hereunder. The insuring party shall be designated in
Paragraph 46 hereof. In the event Lessor is the insuring party, Lessor shall
also maintain the liability insurance described in paragraph 8.2 hereof, in
addition to, and not in lieu of, the insurance required to be maintained by
▇▇▇▇▇▇ under said paragraph 8.2, but Lessor shall not be required to name
Lessee as an additional insured on such policy. Whether the insuring party is
the Lessor or the Lessee, Lessee shall, as additional rent for the Premises,
pay the cost of all insurance required hereunder, except for that portion of
the cost attributable to Lessor's liability insurance coverage in excess of
$1,000,000 per occurrence. If Lessor is the insuring party Lessee shall,
within ten (10) days following demand by ▇▇▇▇▇▇, reimburse Lessor for the
cost of the insurance so obtained.
8.2 LIABILITY INSURANCE. Lessee shall, at ▇▇▇▇▇▇'s expense obtain and keep
in force during the term of this Lease a policy of Combined Single Limit, Bodily
Injury and Property Damage insurance insuring Lessor and Lessee against any
liability arising out of the ownership, use, occupancy or maintenance of the
Premises and all areas appurtenant thereto. Such insurance shall be a combined
single limit policy in an amount not less than $500,000 per occurrence. The
policy shall insure performance by Lessee of the indemnity provisions of this
Paragraph 8. The limits of said insurance shall not, however, limit the
liability of Lessee hereunder.
8.3 PROPERTY INSURANCE.
(a) The insuring party shall obtain and keep in force during the
term of this Lease a policy or policies of insurance covering loss or damage
to the Premises, in the amount of the full replacement value thereof, as the
same may exist from time to time, which replacement value is now
$1,800,000.00, but in no event less than the total amount required by lenders
having liens on the Premises, against all perils included within the
classification of fire, extended coverage, vandalism, malicious mischief,
flood (in the event same is required by a lender having a lien on the
Premises), and special extended perils ("all risk" as such term is used in
the insurance industry). Said insurance shall provide for Payment of loss
thereunder to Lessor or to the holders of mortgages or deeds of trust on the
Premises. The insuring Party shall, in addition, obtain and keep in force
during the term of this Lease a policy of rental value insurance covering a
period of one year, with loss payable to Lessor, which insurance shall also
cover all real estate taxes and insurance costs for said period. A stipulated
value or agreed amount endorsement deleting the coinsurance provision of the
policy shall be procured with said insurance as well as an automatic increase
in insurance endorsement causing the increase in annual property insurance
coverage by 2% per quarter. If the insuring party shall fail to procure and
maintain said insurance the other party may, but shall not be required to,
procure and maintain the same, but at the expense of ▇▇▇▇▇▇. If such
insurance coverage has a deductible clause, the deductible amount shall not
exceed $1,000 per occurrence, and Lessee shall be liable for such deductible
amount.
(b) If the Premises are part of a larger building, or if the Premises
are part of a group of buildings owned by Lessor which are adjacent to the
Premises, then Lessee shall pay for any increase in the property insurance of
such other building or buildings if said increase is caused by ▇▇▇▇▇▇'s acts,
omissions, use or occupancy of the Premises.
(c) If the Lessor is the insuring party the Lessor will not insure
▇▇▇▇▇▇'s fixtures, equipment or tenant improvements unless the tenant
improvements have become a part of the Premises under paragraph 7, hereof.
But if Lessee is the insuring party the Lessee shall insure its fixtures,
equipment and tenant improvements.
8.4 INSURANCE POLICIES. Insurance required hereunder shall be in
companies holding a "General Policyholders Rating" of at least B plus, or
such other rating as may be required by a lender having a lien on the
Premises, as set forth in the most current issue of "Best's Insurance Guide".
The insuring party shall deliver to the other party copies of policies of
such insurance or certificates evidencing the existence and amounts of such
insurance with loss payable clauses as required by this paragraph 8. No such
policy shall be cancellable or subject to reduction of coverage or other
modification except after thirty (30) days' prior written notice to Lessor.
If ▇▇▇▇▇▇ is the insuring party Lessee shall, at least thirty (30) days prior
to the expiration of such policies, furnish Lessor with renewals or "binders"
thereof, or Lessor may order such insurance and charge the cost thereof to
Lessee, which amount shall be payable by Lessee upon demand. Lessee shall not
do or permit to be done anything which shall invalidate the insurance
policies referred to in Paragraph 8.3. If Lessee does or permits to be done
anything which shall increase the cost of the insurance policies referred to
in Paragraph 6.3, then Lessee shall forthwith upon ▇▇▇▇▇▇'s demand reimburse
Lessor for any additional premiums attributable to any act or omission or
operation of Lessee causing such increase in the cost of insurance. If Lessor
is the insuring party, and if the insurance policies maintained hereunder
cover other improvements in addition to the Premises, Lessor shall deliver to
Lessee a written statement setting forth the amount of any such insurance
cost increase and showing in reasonable detail the manner in which it has
been computed.
8.5 WAIVER OF SUBROGATION. ▇▇▇▇▇▇ and ▇▇▇▇▇▇ each hereby release and
relieve the other, and waive their entire right of recovery against the other
for loss or damage arising out of or incident to the perils insured against
under paragraph 8.3, which perils occur in, on or about the Premises, whether
due to the negligence of Lessor or Lessee or their agents, employees,
contractors and/or invitees. ▇▇▇▇▇▇ and Lessor shall, upon obtaining the
policies of insurance required hereunder, give notice to the insurance
carrier or carriers that the foregoing mutual waiver of subrogation is
contained in this Lease.
8.6 INDEMNITY. Lease shall indemnify and hold harmless Lessor from and
against any and all claims arising from ▇▇▇▇▇▇'s use of the Premises, or from
the conduct of Lessee's business or from any activity, work or things done,
permitted or suffered by Lessee in or about the Premises or elsewhere and
shall further indemnify and hold harmless Lessor from and against any and all
claims arising from any breach or default in the performance of any
obligation on Lessee's part to be performed under the terms of this Lease, or
arising from any negligence of the Lessee, or any of Lessee's agents,
contractors, or employees, and from and against all costs, attorney's fees,
expenses and liabilities incurred in the defense of any such claim or any
action or proceeding brought thereon, and in case any action or proceeding be
brought against Lessor by reason of any such claim. Lessee upon notice from
▇▇▇▇▇▇ shall defend the same at ▇▇▇▇▇▇'s expense by counsel satisfactory to
Lessor. Lessee, as a material part of the consideration to Lessor, hereby
assumes all risk of damage to property or injury to persons, in, upon or
about the Premises arising from any cause and Lessee hereby waives all claims
in respect thereof against Lessor.
8.7 EXEMPTION OF LESSOR FROM LIABILITY. ▇▇▇▇▇▇ hereby agrees that Lessor
shall not be liable for injury to ▇▇▇▇▇▇'s business or any loss of income
therefrom or for damage to the goods, wares, merchandise or other property of
▇▇▇▇▇▇. Lessee's employees, invitees, customers, or any other person in or
about the Premises, nor shall Lessor be liable for injury to the person of
▇▇▇▇▇▇. Lessee's employees, agents or contractors, whether such damage or
injury is caused by or results from fire, steam, electricity, gas, water or
rain, or from the breakage, leakage, obstruction or other defects of pipes,
sprinklers, wires, appliances, plumbing, air conditioning or lighting
fixtures, or from any other cause, whether the said damage or injury results
from conditions arising upon the Premises or upon other portions of the
building of which the Premises are a part or from other sources or places and
regardless of whether the cause of such damage or injury or the means of
repairing the same is inaccessible to Lessee. Lessor shall not be liable for
any damages arising from any act or neglect of any other tenant, if any, of
the building in which the Premises are located
Initials: [ILLEGIBLE]
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[ILLEGIBLE]
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NET
9. DAMAGE OR DESTRUCTION.
9.1 DEFINITIONS.
(a) "Premises Partial Damage" shall herein mean damage or destruction
to the Premises to the extent that the cost of repair is less than 50% of the
then replacement cost of the Premises. "Premises Building Partial Damage" shall
herein mean damage or destruction to the building of which the Premises are a
part to the extent that the cost of repair is less than 50% of the then
replacement cost of such building as a whole.
(b) "Premises Total Destruction" shall herein mean damage or
destruction to the Premises to the extent that the cost of repair is 50% or more
of the then replacement cost of the Premises. "Premises Building Total
Destruction" shall herein mean damage or destruction to the building of which
the Premises are a part to the extent that the cost of repair is 50% or more of
the then replacement cost of such building as a whole.
(c) "Insured Loss" shall herein mean damage or destruction which was
caused by an event required to be covered by the insurance described in
paragraph 8.
9.2 PARTIAL DAMAGE--INSURED LOSS. Subject to the provisions of
paragraphs 9.4, 9.5 and 9.6, if at any time during the term of this Lease
there is damage which is an Insured Loss and which falls into the
classification of Premises Partial Damage or Premises Building Partial
Damage, then Lessor shall, at Lessor's expense, repair such damage, but not
Lessee's fixtures, equipment or tenant improvements unless the same have
become a part of the Premises pursuant to Paragraph 7.5 hereof as soon as
reasonably possible and this Lease shall continue in full force and effect.
Notwithstanding the above, if the Lessee is the insuring party, and if the
insurance proceeds received by Lessor are not sufficient to effect such
repair, Lessor shall give notice to Lessee of the amount required in addition
to the insurance proceeds to effect such repair. Lessee shall contribute the
required amount to Lessor within ten days after Lessee has received notice
from Lessor of the shortage in the insurance. When Lessee shall contribute
such amount to Lessor, Lessor shall make such repairs as soon as reasonably
possible and this Lease shall continue in full force and effect. Lessee shall
in no event have any right to reimbursement for any such amounts so
contributed.
9.3 PARTIAL DAMAGE--UNINSURED LOSS. Subject to the provisions of
Paragraphs 9.4, 9.5 and 9.6, if at any time during the term of this Lease
there is damage which is not an Insured Loss and which falls within the
classification of Premises Partial Damage or Premises Building Partial
Damage, unless caused by a negligent or willful act of Lessee (in which event
Lessee shall make the repairs at Lessee's expense), Lessor may at Lessor's
option either (i) repair such damage as soon as reasonably possible at
Lessor's expense, in which event this Lease shall continue in full force and
effect, or (ii) give written notice to Lessee within thirty (30) days after
the date of the occurrence of such damage of Lessor's intention to cancel and
terminate this Lease, as of the date of the occurrence of such damage. In the
event Lessor elects to give such notice of ▇▇▇▇▇▇'s intention to cancel and
terminate this Lease, Lessee shall have the right within ten (10) days after
the receipt of such notice to give written notice to Lessor of ▇▇▇▇▇▇'s
intention to repair such damage at ▇▇▇▇▇▇'s expense, without reimbursement
from Lessor, in which event this Lease shall continue in full force and
effect, and Lessee shall proceed to make such repairs as soon as reasonably
possible. If Lessee does not give such notice within such 10-day period this
Lease shall be cancelled and terminated as of the date of the occurrence of
such damage.
9.4 TOTAL DESTRUCTION. If at any time during the term of this Lease
there is damage, whether or not an Insured Loss, (including destruction
required by any authorized public authority), which falls into the
classification of Premises Total Destruction or Premises Building Total
Destruction, this Lease shall automatically terminate as of the date of such
total destruction.
9.5 DAMAGE NEAR END OF TERM.
(a) If at any time during the last six months of the term of this Lease
there is damage, whether or not an Insured Loss, which falls within the
classification of Premises Partial Damage, Lessor may at Lessor's option cancel
and terminate this Lease as of the date of occurrence of such damage by giving
written notice to Lessee of Lessor's election to do so within 30 days after the
date of occurrence of such damage.
(b) Notwithstanding paragraph 9.5(a), in the event that Lessee has
an option to extend or renew this Lease, and the time within which said
option may be exercised has not yet expired, Lessee shall exercise such
option, if it is to be exercised at all, no later than 20 days after the
occurrence of an Insured Loss falling within the classification of Premises
Partial Damage during the last six months of the term of this Lease. If
Lessee duly exercises such option during said 20 day period, Lessor shall, at
Lessor's expense, repair such damage as soon as reasonably possible and this
Lease shall continue in full force and effect. If Lessee fails to exercise
such option during said 20 day period, then Lessor may at Lessor's option
terminate and cancel this Lease as of the expiration of said 20 day period by
giving written notice to Lessee of Lessor's election to do so within 10 days
after the expiration of said 20 day period, notwithstanding any term or
provision in the grant of option to the contrary.
9.6 ABATEMENT OF RENT; ▇▇▇▇▇▇'S REMEDIES.
(a) In the event of damage described in paragraphs 9.2 or 9.3, and
Lessor or Lessee repairs or restores the Premises pursuant to the provisions of
this Paragraph 9, the rent payable hereunder for the period during which such
damage, repair or restoration continues shall be abated in proportion to the
degree to which ▇▇▇▇▇▇'s use of the Premises is impaired. Except for abatement
of rent, if any, Lessee shall have no claim against Lessor for any damage
suffered by reason of any such damage, destruction, repair or restoration.
(b) If Lessor shall be obligated to repair or restore the Premises
under the provisions of this Paragraph 9 and shall not commence such repair
or restoration within 90 days after such obligations shall accrue, Lessee may
at Lessee's option cancel and terminate this Lease by giving Lessor written
notice of ▇▇▇▇▇▇'s election to do so at any time prior to the commencement of
such repair or restoration. In such event this Lease shall terminate as of
the date of such notice.
9.7 TERMINATION--ADVANCE PAYMENTS. Upon termination of this Lease pursuant
to this Paragraph 9, an equitable adjustment shall be made concerning advance
rent and any advance payments made by Lessee to Lessor. Lessor shall, in
addition, return to Lessee so much of ▇▇▇▇▇▇'s security deposit as has not
theretofore been applied by Lessor.
9.8 WAIVER. Lessor and Lessee waive the provisions of any statutes which
relate to termination of leases when leased property is destroyed and agree that
such event shall be governed by the terms of this Lease.
10. REAL PROPERTY TAXES.
10.1 PAYMENT OF TAXES. Lessee shall pay the real property tax, as defined
in paragraph 10.2, applicable to the Premises during the term of this Lease. All
such payments shall be made at least ten (10) days prior to the delinquency date
of such payment. Lessee shall promptly furnish Lessor with satisfactory evidence
that such taxes have been paid. If any such taxes paid by ▇▇▇▇▇▇ shall cover any
period of time prior to or after the expiration of the term hereof, ▇▇▇▇▇▇'s
share of such taxes shall be equitably prorated to cover only the period of time
within the tax fiscal year during which this Lease shall be in effect, and
Lessor shall reimburse Lessee to the extent required. If Lessee shall fail to
pay any such taxes, Lessor shall have the right to pay the same, in which case
Lessee shall repay such amount to Lessor with ▇▇▇▇▇▇'s next rent installment
together with interest at the maximum rate then allowable by law.
10.2 DEFINITION OF "REAL PROPERTY TAX". As used herein, the term "real
property tax" shall include any form of real estate tax or assessment, general,
special, ordinary or extraordinary, and any license fee, commercial rental tax,
improvement bond or bonds, levy or tax (other than inheritance, personal income
or estate taxes) imposed on the Premises by any authority having the direct or
indirect power to tax, including any city, state or federal government, or any
school, agricultural, sanitary, fire, street, drainage or other improvement
district thereof, as against any legal or equitable interest of Lessor in the
Premises or in the real property of which the Premises are a part, as against
▇▇▇▇▇▇'s right to rent or other income therefrom, and as against ▇▇▇▇▇▇'s
business of leasing the Premises. The term "real property tax" shall also
include any tax, fee, levy, assessment or charge (i) in substitution of,
partially or totally, any tax, fee, levy, assessment or charge hereinabove
included within the definition of "real property tax," or (ii) the nature of
which was hereinbefore included within the definition of "real property tax," or
(iii) which is imposed for a service or right not charged prior to June 1, 1978,
or, if previously charged, has been increased since June 1, 1978, or (iv) which
is imposed by reason of this transaction, any modifications or changes hereto,
or any transfers hereof. See Addendum #10.2
10.3 JOINT ASSESSMENT. If the Premises are not separately assessed,
▇▇▇▇▇▇'s liability shall be an equitable proportion of the real property taxes
for all of the land and improvements included within the tax parcel assessed,
such proportion to be determined by Lessor from the respective valuations
assigned in the assessor's work sheets or such other information as may be
reasonably available. Lessor's reasonable determination thereof, in good faith,
shall be conclusive.
10.4 PERSONAL PROPERTY TAXES.
(a) Lessee shall pay prior to delinquency all taxes assessed against
and levied upon trade fixtures, furnishings, equipment and all other personal
property of Lessee contained in the Premises or elsewhere. When possible, ▇▇▇▇▇▇
shall cause said trade fixtures, furnishings, equipment and all other personal
property to be assessed and billed separately from the real property of Lessor.
(b) If any of ▇▇▇▇▇▇'s said personal property shall be assessed with
▇▇▇▇▇▇'s real property, Lessee shall pay Lessor the taxes attributable to Lessee
within 10 days after receipt of a written statement setting forth the taxes
applicable to ▇▇▇▇▇▇'s property.
11. UTILITIES. Lessee shall pay for all water, gas, heat, light, power,
telephone and other utilities and services supplied to the Premises, together
with any taxes thereon. If any such services are not separately metered to
Lessee, Lessee shall pay a reasonable proportion to be determined by Lessor
of all charges jointly metered with other premises.
12. ASSIGNMENT AND SUBLETTING.
12.1 LESSOR'S CONSENT REQUIRED. Lessee shall not voluntarily or by
operation of law assign, transfer, mortgage, sublet, or otherwise transfer or
encumber all or any part of ▇▇▇▇▇▇'s interest in this Lease or in the Premises,
without ▇▇▇▇▇▇'s prior written consent, which Lessor shall not unreasonably
withhold. Lessor shall respond to ▇▇▇▇▇▇'s request for consent hereunder in a
timely manner and any attempted assignment, transfer, mortgage, encumbrance or
subletting without such consent shall be void, and shall constitute a breach of
this Lease.
12.2 LESSEE AFFILIATE. Notwithstanding the provisions of paragraph 12.1
hereof, Lessee may assign or sublet the Premises, or any portion thereof,
without Lessor's consent, to any corporation which controls, is controlled by or
is under common control with Lessee, or to any corporation resulting from the
merger or consolidation with Lessee, or to any person or entity which acquires
all the assets of Lessee as a going concern of the business that is being
conducted on the Premises, provided that said assignee assumes, in full, the
obligations of Lessee under this Lease. Any such assignment shall not, in any
way, affect or limit the liability of Lessee under the terms of this Lease even
if after such assignment or subletting the terms of this Lease are materially
changed or altered without the consent of Lessee, the consent of whom shall not
be necessary.
12.3 NO RELEASE OF LESSEE. Regardless of Lessor's consent, no subletting or
assignment shall release Lessee of ▇▇▇▇▇▇'s obligation or alter the primary
liability of Lessee to pay the rent and to perform all other obligations to be
performed by Lessee hereunder. The acceptance of rent by Lessor from any other
person shall not be deemed to be a waiver by Lessor of any provision hereof.
Consent to one assignment or subletting shall not be deemed consent to any
subsequent assignment or subletting. In the event of default by any assignee of
Lessee or any successor of ▇▇▇▇▇▇, in the performance of any of the terms
hereof, Lessor may proceed directly against ▇▇▇▇▇▇ without the necessity of
exhausting remedies against said assignee. Lessor may consent to subsequent
assignments or subletting of this Lease or amendments or modifications to this
Lease with assignees
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of Lessee, without notifying Lessee, or any successor of ▇▇▇▇▇▇, and without
obtaining its or their consent thereto and such action shall not relieve Lessee
of liability under this Lease.
12.4 ATTORNEY'S FEES. In the event Lessee shall assign or sublet the
Premises or request the consent of Lessor to any assignment or subletting or if
Lessee shall request the consent of Lessor for any act Lessee proposes to do
then Lessee shall pay Lessor's reasonable attorneys fees incurred in connection
therewith, such attorneys fees not to exceed $350.00 for each such request.
13. DEFAULTS; REMEDIES.
13.1 DEFAULTS. The occurrence of any one or more of the following events
shall constitute a material default and breach of this Lease by ▇▇▇▇▇▇:
(a) The vacating or abandonment of the Premises by ▇▇▇▇▇▇.
(b) The failure by Lessee to make any payment of rent or any other
payment required to be made by Lessee hereunder, as and when due, where such
failure shall continue for a period of three days after written notice thereof
from Lessor to ▇▇▇▇▇▇. In the event that Lessor serves Lessee with a Notice to
Pay Rent or Quit pursuant to applicable Unlawful Detainer statutes such Notice
to Pay Rent or Quit shall also constitute the notice required by this
subparagraph.
(c) The failure by Lessee to observe or perform any of the covenants,
conditions or provisions of this Lease to be observed or performed by Lessee,
other than described in paragraph (b) above, where such failure shall continue
for a period of 30 days after written notice thereof from Lessor to Lessee;
provided, however, that if the nature of Lessee's default is such that more than
30 days are reasonably required for its cure, then Lessee shall not be deemed to
be in default if Lessee commenced such cure within said 30-day period and
thereafter diligently prosecutes such cure to completion.
(d)(i) The making by Lessee of any general arrangement or assignment
for the benefit of creditors; (ii) Lessee becomes a "debtor" as defined in 11
U.S.C. Section 101 or any successor statute thereto (unless, in the case of a
petition filed against Lessee, the same is dismissed within 60 days); (iii) the
appointment of a trustee or receiver to take possession of substantially all of
▇▇▇▇▇▇'s assets located at the Premises or of Lessee's interest in this Lease,
where possession is not restored to Lessee within 30 days; or (iv) the
attachment, execution or other judicial seizure of substantially all of ▇▇▇▇▇▇'s
assets located at the Premises or of ▇▇▇▇▇▇'s interest in this Lease, where such
seizure is not discharged within 30 days. Provided, however, in the event that
any provision of this paragraph 13.1(d) is contrary to any applicable law, such
provision shall be of no force or effect.
(e) The discovery by Lessor that any financial statement given to
Lessor by ▇▇▇▇▇▇, any assignee of ▇▇▇▇▇▇, any subtenant of ▇▇▇▇▇▇, any successor
in interest of ▇▇▇▇▇▇ or any guarantor of ▇▇▇▇▇▇'s obligation hereunder, and any
of them, was materially false.
13.2 REMEDIES. In the event of any such material default or breach by
Lessee, Lessor may at any time thereafter, with or without notice or demand and
without limiting Lessor in the exercise of any right or remedy which Lessor may
have by reason of such default or breach.
(a) Terminate ▇▇▇▇▇▇'s right to possession of the Premises by any
lawful means, in which case this Lease shall terminate and ▇▇▇▇▇▇ shall
immediately surrender possession of the Premises to Lessor. In such event Lessor
shall be entitled to recover from Lessee all damages incurred by Lessor by
reason of Lessee's default including, but not limited to, the cost of recovering
possession of the Premises; expenses of reletting, including necessary
renovation and alteration of the Premises, reasonable attorney's fees, and any
real estate commission actually paid, the worth at the time of award by the
court having jurisdiction thereof of the amount by which the unpaid rent for the
balance of the term after the time of such award exceeds the amount of such
rental loss for the same period that ▇▇▇▇▇▇ proves could be reasonably avoided;
that portion of the leasing commission paid by Lessor pursuant to Paragraph 15
applicable to the unexpired term of this Lease.
(b) Maintain ▇▇▇▇▇▇'s right to possession in which case this Lease
shall continue in effect whether or not Lessee shall have abandoned the
Premises. In such event Lessor shall be entitled to enforce all of ▇▇▇▇▇▇'s
rights and remedies under this Lease, including the right to recover the rent
as it becomes due hereunder.
(c) Pursue any other remedy now or hereafter available to Lessor under
the laws or judicial decisions of the state wherein the Premises are located.
Unpaid installments of rent and other unpaid monetary obligations of Lessee
under the terms of this Lease shall bear interest from the date due at the
maximum rate then allowable by law.
13.3 DEFAULT BY ▇▇▇▇▇▇. Lessor shall not be in default unless Lessor fails
to perform obligations required of Lessor within a reasonable time, but in no
event later than thirty (30) days after written notice by ▇▇▇▇▇▇ to Lessor and
to the holder of any first mortgage or deed of trust covering the Premises whose
name and address shall have theretofore been furnished to Lessee in writing,
specifying wherein Lessor has failed to perform such obligation; provided,
however, that if the nature of Lessor's obligation is such that more than
thirty (30) days are required for performance then Lessor shall not be in
default if Lessor commences performance within such 30-day period and thereafter
diligently prosecutes the same to completion.
13.4 LATE CHARGES. Lessee hereby acknowledges that late payment by
▇▇▇▇▇▇ to Lessor of rent and other sums due hereunder will cause Lessor to
incur costs not contemplated by this Lease, the exact amount of which will be
extremely difficult to ascertain. Such costs include, but are not limited to,
processing and accounting charges, and late charges which may be imposed on
Lessor by the terms of any mortgage or trust deed covering the Premises.
Accordingly, if any installment of rent or any other sum due from Lessee
shall not be received by Lessor or Lessor's designee within ten (10) days
after such amount shall be due, then, without any requirement for notice to
Lessee, Lessee shall pay to Lessor a late charge equal to 6% of such overdue
amount. The parties hereby agree that such late charge represents a fair and
reasonable estimate of the costs Lessor will incur by reason of late payment
by ▇▇▇▇▇▇. Acceptance of such late charge by Lessor shall in no event
constitute a waiver of ▇▇▇▇▇▇'s default with respect to such overdue amount,
nor prevent Lessor from exercising any of the other rights and remedies
granted hereunder. In the event that a late charge is payable hereunder,
whether or not collected, for three (3) consecutive installments of rent,
then rent shall automatically become due and payable quarterly in advance,
rather than monthly, notwithstanding paragraph 4 or any other provision of
this Lease to the contrary.
13.5 IMPOUNDS. In the event that a late charge is payable hereunder,
whether or not collected, for three (3) installments of rent or any other
monetary obligation of Lessee under the terms of this Lease, Lessee shall pay
to Lessor, if Lessor shall so request, in addition to any other payments
required under this Lease, a monthly advance installment, payable at the same
time as the monthly rent, as estimated by Lessor, for real property tax and
insurance expenses on the Premises which are payable by Lessee under the
terms of this Lease. Such fund shall be established to insure payment when
due, before delinquency, of any or all such real property taxes and insurance
premiums. If the amounts paid to Lessor by Lessee under the provisions of
this paragraph are insufficient to discharge the obligations of Lessee to pay
such real property taxes and insurance premiums as the same become due,
Lessee shall pay to Lessor, upon Lessor's demand, such additional sums
necessary to pay such obligations. All moneys paid to Lessor under this
paragraph may be intermingled with other moneys of ▇▇▇▇▇▇ and shall not bear
interest. In the event of a default in the obligations of Lessee to perform
under this Lease, then any balance remaining from funds paid to Lessor under
the provisions of this paragraph may, at the option of Lessor, be applied to
the payment of any monetary default of Lessee in lieu of being applied to the
payment of real property tax and insurance premiums.
14. CONDEMNATION. If the Premises or any portion thereof are taken under
the power of eminent domain, or sold under the threat of the exercise of said
power (all of which are herein called "condemnation"), this Lease shall
terminate as to the part so taken as of the date the condemning authority
takes title or possession, whichever first occurs. If more than 10% of the
floor area of the building on the Premises, or more than 25% of the land area
of the Premises which is not occupied by any building is taken by
condemnation, Lessee may, at ▇▇▇▇▇▇'s option, to be exercised in writing only
within ten (10) days after Lessor shall have given Lessee written notice of
such taking (or in the absence of such notice, within ten (10) days after the
condemning authority shall have taken possession) terminate this Lease as of
the date the condemning authority takes such possession. If ▇▇▇▇▇▇ does not
terminate this Lease in accordance with the foregoing, this Lease shall
remain in full force and effect as to the portion of the Premises remaining,
except that the rent shall be reduced in the proportion that the floor area
of the building taken bears to the total floor area of the building situated
on the Premises. No reduction of rent shall occur if the only area taken is
that which does not have a building located thereon. Any award for the taking
of all or any part of the Premises under the power of eminent domain or any
payment made under threat of the exercise of such power shall be the property
of Lessor, whether such award shall be made as compensation for diminution in
value of the leasehold or for the taking of the fee, or as severance damages;
provided, however, that Lessee shall be entitled to any award for loss of or
damage to Lessee's trade fixtures and removable personal property. In the
event that this Lease is not terminated by reason of such condemnation,
Lessor shall to the extent of severance damages received by Lessor in
connection with such condemnation, repair any damage to the Premises caused
by such condemnation except to the extent that ▇▇▇▇▇▇ has been reimbursed
therefor by the condemning authority. Lessee shall pay any amount in excess
of such severance damages required to complete such repair.
15. BROKER'S FEE. See Addendum #48.
16. ESTOPPEL CERTIFICATE.
(a) Lessee shall at any time upon not less than ten (10) days' prior
written notice from Lessor execute, acknowledge and deliver to Lessor a
statement in writing (i) certifying that this Lease is unmodified and in full
force and effect (or, if modified, stating the nature of such modification
and certifying that this Lease, as so modified, is in full force and effect)
and the date to which the rent and other charges are paid in advance, if any,
and (ii) acknowledging that there are not, to ▇▇▇▇▇▇'s knowledge, any uncured
defaults on the part of Lessor hereunder, or specifying such defaults if any
are claimed. Any such statement may be conclusively relied upon by any
prospective purchaser or encumbrancer of the Premises.
(b) At Lessor's option, ▇▇▇▇▇▇'s failure to deliver such statement
within such time shall be a material breach of this Lease or shall be
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conclusive upon Lessee (i) that this Lease is in full force and effect,
without modification except as may be represented by Lessor, (ii) that there
are no uncured defaults in Lessor's performance, and (iii) that not more than
one month's rent has been paid in advance or such failure may be considered
by Lessor as a default by Lessee under this Lease.
(c) If Lessor desires to finance, refinance, or sell the Premises, or
any part thereof, Lessee hereby agrees to deliver to any lender or purchaser
designated by Lessor such financial statements of Lessee as may be reasonably
required by such lender or purchaser. Such statements shall include the past
three years' financial statements of ▇▇▇▇▇▇. All such financial statements
shall be received by Lessor and such lender or purchaser in confidence and
shall be used only for the purposes herein set forth.
17. LESSOR'S LIABILITY. The term "Lessor" as used herein shall mean only
the owner or owners at the time in question of the fee title or a lessee's
interest in a ground lease of the Premises, and except as expressly provided
in Paragraph 15, in the event of any transfer of such title or interest, Lessor
herein named (and in case of any subsequent transfers then the grantor) shall
be relieved from and after the date of such transfer of all liability as
respects Lessor's obligations thereafter to be performed, provided that any
funds in the hands of Lessor or the then grantor at the time of such
transfer, in which ▇▇▇▇▇▇ has an interest, shall be delivered to the grantee.
The obligations contained in this Lease to be performed by Lessor shall,
subject as aforesaid, be binding on ▇▇▇▇▇▇'s successors and assigns, only
during their respective periods of ownership.
18. SEVERABILITY. The invalidity of any provision of this Lease as
determined by a court of competent jurisdiction, shall in no way affect the
validity of any other provision hereof.
19. INTEREST ON PAST-DUE OBLIGATIONS. Except as expressly herein provided,
any amount due to Lessor not paid when due shall bear interest at the maximum
rate then allowable by law from the date due. Payment of such interest shall
not excuse or cure any default by Lessee under this Lease, provided, however,
that interest shall not be payable on late charges incurred by Lessee nor on
any amounts upon which late charges are paid by ▇▇▇▇▇▇.
20. TIME OF ESSENCE. Time is of the essence.
21. ADDITIONAL RENT. Any monetary obligations of Lessee to Lessor under the
terms of this Lease shall be deemed to be rent.
22. INCORPORATION OF PRIOR AGREEMENTS; AMENDMENTS. This Lease contains all
agreements of the parties with respect to any matter mentioned herein. No
prior agreement or understanding pertaining to any such matter shall be
effective. This Lease may be modified in writing only, signed by the parties
in interest at the time of the modification. Except as otherwise stated in
this Lease, ▇▇▇▇▇▇ hereby acknowledges that neither the real estate broker
listed in Paragraph 15 hereof nor any cooperating broker on this transaction
nor the Lessor or any employees or agents of any of said persons has made any
oral or written warranties or representations to Lessee relative to the
condition or use by ▇▇▇▇▇▇ of said ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ acknowledges that
Lessee assumes all responsibility regarding the Occupational Safety Health
Act, the legal use and adaptability of the Premises and the compliance
thereof with all applicable laws and regulations in effect during the term of
this Lease except as otherwise specifically stated in this Lease.
23. NOTICES. Any notice required or permitted to be given hereunder shall
be in writing and may be given by personal delivery or by certified mail, and
if given personally or by mail, shall be deemed sufficiently given if
addressed to Lessee or to Lessor at the address noted below the signature of
the respective parties, as the case may be. Either party may by notice to
the other specify a different address for notice purposes except that upon
▇▇▇▇▇▇'s taking possession of the Premises, the Premises shall constitute
▇▇▇▇▇▇'s address for notice purposes. A copy of all notices required or
permitted to be given to Lessor hereunder shall be concurrently transmitted
to such party or parties at such addresses as Lessor may from time to time
hereafter designate by notice to ▇▇▇▇▇▇.
24. WAIVERS. No waiver by Lessor or any provision hereof shall be deemed a
waiver of any other provision hereof or of any subsequent breach by ▇▇▇▇▇▇ of
the same or any other provision. Lessor's consent to, or approval of, any
act shall not be deemed to render unnecessary the obtaining of Lessor's
consent to or approval of any subsequent act by ▇▇▇▇▇▇. The acceptance of
rent hereunder by Lessor shall not be a waiver of any preceding breach by
▇▇▇▇▇▇ of any provision hereof, other than the failure of Lessee to pay the
particular rent so accepted, regardless of Lessor's knowledge of such
preceding breach at the time of acceptance of such rent.
25. RECORDING. Either Lessor or Lessee shall, upon request of the other,
execute, acknowledge and deliver to the other a "short form" memorandum of
this Lease for recording purposes.
26. HOLDING OVER. If ▇▇▇▇▇▇, with ▇▇▇▇▇▇'s consent, remains in possession
of the Premises or any part thereof after the expiration of the term hereof,
such occupancy shall be a tenancy from month to month upon all the provisions
of this Lease pertaining to the obligations of Lessee, but all options and
rights of first refusal, if any, granted under the terms of this Lease shall
be deemed terminated and be of no further effect during said month to month
tenancy.
27. CUMULATIVE REMEDIES. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other remedies
at law or in equity.
28. COVENANTS AND CONDITIONS. Each provision of this Lease performable by
Lessee shall be deemed both a covenant and a condition.
29. BINDING EFFECT; CHOICE OF LAW. Subject to any provisions hereof
restricting assignment or subletting by ▇▇▇▇▇▇ and subject to the provisions
of Paragraph 17, this Lease shall bind the parties, their personal
representatives, successors and assigns. This Lease shall be governed by the
laws of the State wherein the Premises are located.
30. SUBORDINATION.
(a) This Lease, at Lessor's option, shall be subordinate to any
ground lease, mortgage, deed of trust, or any other hypothecation or security
now or hereafter placed upon the real property of which the Premises are a
part and to any and all advances made on the security thereof and to all
renewals, modifications, consolidations, replacements and extensions thereof.
Notwithstanding such subordination, ▇▇▇▇▇▇'s right to quiet possession of the
Premises shall not be disturbed if Lessee is not in default and so long as
Lessee shall pay the rent and observe and perform all of the provisions of
this Lease, unless this Lease is otherwise terminated pursuant to its terms.
If any mortgagee, trustee or ground lessor shall elect to have this Lease
prior to the lien of its mortgage, deed of trust or ground lease, and shall
give written notice thereof to Lessee, this Lease shall be deemed prior to
such mortgage, deed of trust, or ground lease, whether this Lease is dated
prior or subsequent to the date of said mortgage, deed of trust or ground
lease or the date of recording thereof.
(b) ▇▇▇▇▇▇ agrees to execute any documents required to effectuate an
attornment, a subordination or to make this Lease prior to the lien of any
mortgage, deed of trust or ground lease, as the case may be. ▇▇▇▇▇▇'s
failure to execute such documents within 10 days after written demand shall
constitute a material default by Lessee hereunder, or, at ▇▇▇▇▇▇'s option,
▇▇▇▇▇▇ shall execute such documents on behalf of ▇▇▇▇▇▇ as ▇▇▇▇▇▇'s
attorney-in-fact. ▇▇▇▇▇▇ does hereby make, constitute and irrevocably
appoint ▇▇▇▇▇▇ as ▇▇▇▇▇▇'s attorney-in-fact and in ▇▇▇▇▇▇'s name, place and
stead, to execute such documents in accordance with this paragraph 30(b).
31. ATTORNEY'S FEES. If either party or the broker named herein brings an
action to enforce the terms hereof or declare rights hereunder, the
prevailing party in any such action, on trial or appeal, shall be entitled to
his reasonable attorney's fees to be paid by the losing party as fixed by the
court. The provisions of this paragraph shall inure to the benefit of the
broker named herein who seeks to enforce a right hereunder.
32. LESSOR'S ACCESS. Lessor and ▇▇▇▇▇▇'s agents shall have the right to
enter the Premises at reasonable times for the purpose of inspecting the
same, showing the same to prospective purchasers, lenders, or lessees, and
making such alterations, repairs, improvements or additions to the Premises
or to the building of which they are a part as Lessor may deem necessary or
desirable. Lessor may at any time place on or about the Premises any
ordinary "For Sale" signs and Lessor may at any time during the last 120 days
of the term hereof place on or about the Premises any ordinary "For Lease"
signs, all without rebate of rent or liability to Lessee.
33. AUCTIONS. Lessee shall not conduct, nor permit to be conducted, either
voluntarily or involuntarily, any auction upon the Premises without first
having obtained ▇▇▇▇▇▇'s prior written consent. Notwithstanding anything to
the contrary in this Lease, Lessor shall not be obligated to exercise any
standard of reasonableness in determining whether to grant such consent.
34. SIGNS. Lessee shall not place any sign upon the Premises without
▇▇▇▇▇▇'s prior written consent except that Lessee shall have the right,
without the prior permission of Lessor to place ordinary and usual for rent
or sublet signs thereon.
35. MERGER. The voluntary or other surrender of this Lease by ▇▇▇▇▇▇, or a
mutual cancellation thereof, or a termination by Lessor, shall not work a
merger, and shall, at the option of Lessor, terminate all or any existing
subtenancies or may, at the option of Lessor, operate as an assignment to
Lessor of any or all of such subtenancies.
36. CONSENTS. Except for paragraph 33 hereof, wherever in this Lease the
consent of one party is required to an act of the other party such consent
shall not be unreasonably withheld.
37. GUARANTOR. In the event that there is a guarantor of this Lease, said
guarantor shall have the same obligations as Lessee under this Lease.
38. QUIET POSSESSION. Upon ▇▇▇▇▇▇ paying the rent for the Premises and
observing and performing all of the covenants, conditions and provisions on
▇▇▇▇▇▇'s part to be observed and performed hereunder. Lessee shall have
quiet possession of the Premises for the entire term hereof subject to all of
the provisions of this Lease. The individuals executing this Lease on behalf
of Lessor represent and warrant to Lessee that they are fully authorized and
legally capable of executing this Lease on behalf of Lessor and that such
execution is binding upon all parties holding an ownership interest in the
Premises.
39. OPTIONS.
39.1 DEFINITION. As used in this paragraph the word "Options" has the
following meaning: (1) the right or option to extend the term of this Lease
or to renew this Lease or to extend or renew any lease that Lessee has on
other property of Lessor, (2) the option or right of first refusal to lease
the Premises or the right of first offer to lease the Premises or the right
of first refusal to lease other property of Lessor or the right of first
offer to lease other property of Lessor; (3) the right or option to purchase
the Premises, or the right of first refusal to purchase the Premises, or the
right of first offer to purchase the Premises or the right or option to
purchase other property of Lessor, or the right of first refusal to purchase
other property of Lessor or the right of first offer to purchase other
property of Lessor.
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39.2 OPTIONS PERSONAL. The Options herein granted to Lessee are not
assignable separate and apart from this Lease.
39.3 MULTIPLE OPTIONS. In the event that Lessee has any multiple
options to extend or renew this Lease a later option cannot be exercised
unless the prior option to extend or renew this Lease has been so exercised.
39.4 EFFECT OF DEFAULT ON OPTIONS.
(a) Lessee shall have no right to exercise an Option,
notwithstanding any provision in the grant of Option to the contrary, (i)
during the time commencing from the date Lessor gives to Lessee a notice of
default pursuant to paragraph 13.1(b) or 13.1(c) and continuing until the
default alleged in said notice of default is cured, or (ii) during the period
of time commencing on the day after a monetary obligation to Lessor is due
from Lessee and unpaid (without any necessity for notice thereof to Lessee)
continuing until the obligation is paid, or (iii) at any time after an event
of default described in paragraphs 13.1(a), 13.1(d), or 13.1(e) (without
any necessity of Lessor to give notice of such default to Lessee), or (iv) in
the event that Lessor has given to Lessee three or more notices of default
under paragraph 13.1(b), where a late charge has become payable under
paragraph 13.4 for each of such defaults, or paragraph 13.1(c), whether or
not the defaults are cured, during the 12 month period prior to the time
that Lessee intends to exercise the subject Option.
(b) The period of time within which an Option may be exercised
shall not be extended or enlarged by reason of ▇▇▇▇▇▇'s inability to exercise
an Option because of the provisions of paragraph 39.4(a).
(c) All rights of Lessee under the provisions of an Option shall
terminate and be of no further force or effect, notwithstanding Lessee's due
and timely exercise of the Option, if, after such exercise and during the
term of this Lease, (i) Lessee fails to pay to Lessor a monetary obligation
of Lessee for a period of 30 days after such obligation becomes due (without
any necessity of Lessor to give notice thereof to Lessee), or (ii) Lessee
fails to commence to cure a default specified in paragraph 13.1(c) within 30
days after the date that Lessor gives notice to Lessee of such default and/or
Lessee fails thereafter to diligently prosecute said cure to completion, or
(iii) Lessee commits a default described in paragraph 13.1(a), 13.1(d) or
13.1(e) (without any necessity of Lessor to give notice of such default to
Lessee), or (iv) Lessor gives to Lessee three or more notices of default
under paragraph 13.1(b), where a late charge becomes payable under paragraph
13.4 for each such default, or paragraph 13.1(c), whether or not the defaults
are cured.
40. MULTIPLE TENANT BUILDING. In the event that the Premises are
part of a larger building or group of buildings then ▇▇▇▇▇▇ agrees that it
will abide by, keep and observe all reasonable rules and regulations which
Lessor may make from time to time for the management, safety, care, and
cleanliness of the building and grounds, the parking of vehicles and the
preservation of good order therein as well as for the convenience of other
occupants and tenants of the building. The violations of any such rules and
regulations shall be deemed a material breach of this Lease by ▇▇▇▇▇▇.
41. SECURITY MEASURES. Lessee hereby acknowledges that the rental
payable to Lessor hereunder does not include the cost of guard service or
other security measures, and that Lessor shall have no obligation whatsoever
to provide same. Lessee assumes all responsibility for the protection of
Lessee, its agents and invitees from acts of third parties.
42. EASEMENTS. Lessor reserves to itself the right, from time to time, to
grant such easements, rights and dedications that Lessor deems necessary or
desirable, and to cause the recordation of Parcel Maps and restrictions so
long as such easements, rights, dedications, Maps and restrictions do not
unreasonably interfere with the use of the Premises by ▇▇▇▇▇▇. Lessee shall
sign any of the aforementioned documents upon request of Lessor and failure
to do so shall constitute a material breach of this Lease.
43. PERFORMANCE UNDER PROTEST. If at any time a dispute shall arise as to
any amount or sum of money to be paid by one party to the other under the
provisions hereof, the party against whom the obligation to pay the money is
asserted shall have the right to make payment "under protest" and such
payment shall not be regarded as a voluntary payment, and there shall survive
the right on the part of said party to institute suit for recovery of such
sum. If it shall be adjudged that there was no legal obligation on the part
of said party to pay such sum or any part thereof, said party shall be
entitled to recover such sum or so much thereof as it was not legally
required to pay under the provisions of this Lease.
44. AUTHORITY. If Lessee is a corporation, trust, or general or limited
partnership, each individual executing this Lease on behalf of such entity
represents and warrants that he or she is duly authorized to execute and
deliver this Lease on behalf of said entity. If Lessee is a corporation,
trust or partnership, Lessee shall, within thirty (30) days after execution
of this Lease, deliver to Lessor evidence of such authority satisfactory to
Lessor.
45. CONFLICT. Any conflict between the printed provisions of this Lease
and the typewritten or handwritten provisions shall be controlled by the
typewritten or handwritten provisions.
46. INSURING PARTY. The Insuring party under this lease shall be the
Lessee.
47. ADDENDUM. Attached hereto is an addendum or addenda containing
paragraphs 4 through 48 which constitutes a part of this Lease.
1. Addendum to Lease
2. Right of First Refusal To Purchase
3. Option To Extend
▇▇▇▇▇▇ AND ▇▇▇▇▇▇ HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM
AND PROVISION CONTAINED HEREIN AND, BY EXECUTION OF THIS LEASE, SHOW THEIR
INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE
TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY
REASONABLE AND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH
RESPECT TO THE PREMISES.
IF THIS LEASE HAS BEEN FILLED IN IT HAS BEEN PREPARED FOR SUBMISSION TO
YOUR ATTORNEY FOR HIS APPROVAL, NO REPRESENTATION OR RECOMMENDATION IS
MADE BY THE AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION OR BY THE REAL
ESTATE BROKER OR ITS AGENTS OR EMPLOYEES AS TO THE LEGAL SUFFICIENCY,
LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS LEASE OR THE TRANSACTION
RELATING THERETO. THE PARTIES SHALL RELY SOLELY UPON THE ADVICE OF THEIR
OWN LEGAL COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS LEASE.
THE PARTIES HERETO HAVE EXECUTED THIS LEASE AT THE PLACE ON THE DATES
SPECIFIED IMMEDIATELY ADJACENT TO THEIR RESPECTIVE SIGNATURES.
Executed at Oscar and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Trust
--------------------------------- -------------------------------
on By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------------------ -----------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Address By /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------------- -----------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------------------- "LESSOR" (Corporate seal)
Executed at Speciality Laboratories, Inc.
--------------------------------- -------------------------------
on By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------------ -----------------------------
▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇, M.D., Ph.D.
Address By
------------------------------------- -----------------------------
-------------------------------------------- "LESSEE" (Corporate seal)
[LOGO]
ADDENDUM TO
STANDARD LEASE
DATED July 17, 1993
BY AND BETWEEN ▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Trust (Lessor)
and Specialty Laboratories Inc. (Lessee)
1st RIGHT OF FIRST REFUSAL TO PURCHASE
(a) Lessor shall not, at any time prior to the expiration of the term of
this Lease, or any extension thereof, sell the Premises, or any interest
therein, without first giving written notice thereof to Lessee, which notice
is hereinafter referred to as "Notice of Sale".
(b) The Notice of Sale shall include the exact and complete terms of the
proposed sale and shall have attached thereto a photocopy of bona fide offer
and counteroffer, if any, duly executed by both Lessor and the prospective
purchaser.
(c) For a period of Twenty (20) days after receipt by Lessee of the
Notice of Sale, Lessee shall have the right to give written notice to Lessor
of ▇▇▇▇▇▇'s exercise of ▇▇▇▇▇▇'s right to purchase the Premises, or the
interest proposed to be sold, on the same terms, price and conditions as set
forth in the Notice of Sale. In the event that ▇▇▇▇▇▇ does not receive
written notice of ▇▇▇▇▇▇'s exercise of the right herein granted within said
20 day period, there shall be a conclusive presumption that ▇▇▇▇▇▇ has
elected not to exercise ▇▇▇▇▇▇'s right hereunder, and Lessor may sell the
Premises, or the interest proposed to be sold, on the same terms set forth in
the Notice of Sale.
(d) In the event that Lessee declines to exercise its right of first
refusal after receipt of the Notice of Sale, and thereafter, Lessor and the
prospective purchaser modify by more than 5%, (i) the sales price, (ii) the
amount of down payment, or (iii) interest charged, or in the event that the
sale is not consummated within 20 days of the date of the Notice of Sale,
then ▇▇▇▇▇▇'s right of first refusal shall reapply to said transaction of the
occurance of any of the aforementioned events.
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[LOGO]
ADDENDUM TO
STANDARD INDUSTRIAL LEASE
DATED July 17, 1993
BY AND BETWEEN ▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Trust (Lessor)
and Specialty Laboratories Inc. (Lessee)
1st OPTION TO EXTEND
▇. ▇▇▇▇▇▇ hereby grants to Lessee the option to extend the term of this
Lease for a Four year period commencing when the prior term expires upon each
and all of the following terms and conditions:
(i) Lessee gives to Lessor, and ▇▇▇▇▇▇ actually receives on a date which
is prior to the date that the option period would commence (if exercised) by
at least six (6) and not more than nine (9) months, a written notice of the
exercise of the option to extend this lease for said additional term, time
being of the essence. If said notification of the exercise of said option is
not so given and received, this option shall automatically expire;
(ii) The provisions of Paragraph 39, including the provision relating to
default of Lessee set forth in paragraph 39.4 of this Lease are conditions of
this Option;
(iii) All of the terms and conditions of this Lease except where
specifically modified by this option shall apply;
(iv) The new monthly base rent for each month of the option period will
not be greater than $1.10 per square foot or less than $0.90 per square foot
and shall be calculated as follows:
Within 30 days of ▇▇▇▇▇▇'s written notice of ▇▇▇▇▇▇'s exercising the
option, ▇▇▇▇▇▇ shall deliver in writing to Lessee the new monthly Base Rent
for the space. Lessee's new monthly Base rent for the option period shall be
based upon the then prevailing market rate for similar buildings and similar
space in Santa ▇▇▇▇▇▇ Area as supported by documentation. In the event Lessor
does not receive written objection to the new monthly Base Rent within 10
business days from written notification from Lessor then Lessee shall have
deemed to accept the new monthly Base Rent.
In the event the Lessee does object to the new monthly Base Rent then
Lessee shall submit in writing along with the written objection the amount
that ▇▇▇▇▇▇ proposes to be the correct new monthly Base Rent for the space
based upon prevailing market rates for similar buildings and space in the
Santa ▇▇▇▇▇▇ area as supported by documentation. Lessor shall respond in
writing within 10 days from receipt of ▇▇▇▇▇▇'s proposed new monthly Base
Rent Lessor's agreement, or objection, to the proposed amount.
In the event Lessor objects to ▇▇▇▇▇▇'s proposed new monthly Base Rent
then, within 30 days from Lessor's written objection, Lessor and the Lessee
shall mutually agree upon and hire an MAI Appraiser to determine the new
monthly Base Rent. The cost of the appraisal shall be shared equally between
the Lessor and the Lessee. The Appraiser's determination of the new monthly
base rent shall be binding on both Lessor and Lessee without any right of
appeal, however in no event shall the new monthly Base Rent be greater than
$1.10 per square foot or less than $0.90 per square foot.
This new monthly Base Rent for the option period shall not be increased
for the term of the option period.
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