Document is copied.
EXHIBIT 10.12
LEASE AGREEMENT
1. SPECIFIC INFORMATION:
1.1. The "Landlord" is Redson Building Partnership a Washington general
partnership.
1.2. The "Tenant" is Vision Newco, a Delaware corporation.
1.3. Location of Premises: The "Premises" are the portion, which is
crosshatched on the attached floor plan, of the building location on the
property ("Property") which is legally described on schedule 1.3.
1.4. Lease Duration:
1.4.1. The "Commencement Date" of this Lease is December 15, 1995.
1.4.2. The "Termination Date" of this Lease is February 15, 2001.
1.5. The "Basic Monthly Rent: at the commencement of this Lease is Ten
Thousand Four Hundred Fifty One Dollars ($10,451) (which shall be adjusted
periodically in accordance with schedule 1.5, if attached).
1.6. The "Allowed Use" of the Premises is assemblage and storage of
electronic components and related general office use.
1.7. On signing this Lease, Tenant shall pay Landlord Ten Thousand Four
Hundred Fifty One Dollars ($10,451) to be applied toward payment of the first
month of the term of this Lease ("Advance Rent") and shall deposit Ten Thousand
Five Hundred ($10,500) Dollars to be held as the "Security Deposit."
1.8. Tenant's Pro Rata Share of Operating Expenses is forty eight and 30/00
percent (48.30%)
1.9. Notice Address of Tenant:
Vision Newro, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
1.10. Notice Address of Landlord:
c/o ▇▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇▇▇, Attn:▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
1.11. Date. This Lease is dated, for reference purposes, only, as of
December 1, 1995.
1.12. Agency Disclosure:
1.12.1. At the time of the signing of this Agreement, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇ represented :Landlord.
1.12.2. Landlord and Tenant confirm that prior oral or written
disclosure of agency was provided to them in this transaction.
2. PREMISES. Landlord hereby leases to Tenant and Tenant leases from Landlord
for the term, at the rental, and on all of the terms and conditions of this
Lease, the Premises.
3. TERM.
3.1. TERM. The term of this Lease is from the Commencement Date until the
Termination Date, unless sooner terminated pursuant to any provision hereof.
3.2. DELAY IN COMMENCEMENT. Despite the stated Commencement Date, the
Landlord shall not be liable to Tenant and this Lease (including the stated
Termination Date) and the Tenant obligations under this Lease shall be
unaffected if for any reason Landlord does not deliver possession of the
Premises to Tenant on the Commencement Date, but in such case Tenant shall have
no obligation to pay rent until Landlord delivers possession of the Premises to
Tenant. If Landlord has not delivered possession to the Premises to Tenant,
Tenant may elect by written notice to Landlord cancel this Lease. If the
Landlord shall not have delivered possession of the Premises within one (1) year
from the Commencement Date, Landlord may by notice in writing to Tenant cancel
this Lease. If either party elects to so cancel the Lease, Landlord shall return
any money previously deposited by Tenant and the parties shall be discharged
from all obligations hereunder. In no event, however, shall Tenant have the
right to cancel this Lease because of any delay in delivering possession of the
Premises because of any act of God or the elements; shortage or unavailability
of necessary materials, supplies, or labor; shortage of or interruption on
transportation of facilities; regulations or restriction; or any other cause
beyond Landlord's reasonable control. In the event delivery of possession of the
Premises is delayed beyond the stated Commencement Date, the stated Commencement
Date and the stated Termination Date each shall be extended by the number of
days of such delay.
3.3. EARLY POSSESSION. If Tenant occupies the Premises before the
Commencement Date of the term, all of Tenant's Lease obligations (including
payment of Operating Expenses, but not Basic Monthly Rent) shall become
effective immediately although such early possession shall not accelerate the
Termination Date of this Lease.
3.4 FIRST OPPORTUNITY TO LEASE. Tenant shall have the first opportunity to
lease other space adjacent to its Premises if such space becomes available for
lease. In such case, Landlord shall advise Tenant of its availability and the
terms on which Landlord would lease such space. Tenant acknowledges that
Landlord is negotiating for the lease of the remainder of the building (as well
as the Premises following expiration of Tenant's Lease) with Mr. And ▇▇▇.
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and such Tenant's first opportunity to lease will apply
only if such other lease is not finalized or if such Lease is terminated during
the term of Tenant's Lease. On any such notice, Tenant shall have the right to
lease such adjacent space (for a term equal to Tenant's unexpired term) at the
rent and condition stated in Landlord's notice or upon such other terms as
Tenant and Landlord may agree in their individual directions. Tenant shall have
thirty (30) days after receipt of such notice to not Lessor that Tenant elects
to lease the adjacent space. If Tenant does not exercise its right to lease the
adjacent space to a third party on such terms as may be acceptable to Landlord
and such other party. Tenant does not have any right of renewal of this Lease.
4. RENT
4.1. Basic Monthly Rent. Tenant shall pay to Landlord as rent for the
Premises the Basic Monthly Rent, in advance, on the first day of each on the of
the term hereof. Rent for any period during the term hereof which is for less
than one (1) month shall be a pro-rata portion of the monthly installment. Rent
shall be payable without notice or demand and without deduction, offset, or
abatement, in lawful money of the United States of America to Landlord at such
address and to such other persons or at such other places as Landlord may
designate in writing.
4.2 OPERATING EXPENSES
4.2.1 In addition to the Basic Monthly Rent and commencing on the
earlier of Tenant's occupancy or the Commencement Date, Tenant shall pay to
Landlord monthly tenant's Pro Rata Share of Operating Expenses of the Property.
Periodically Landlord shall submit to Tenant a statement of the anticipated
monthly amount of Tenant's Pro Rata Share of Operating Expenses, and tenant
shall pay the same and all subsequent monthly payments concurrently with the
payment of Basic Monthly Rent or if no Basic Monthly Rent is due and payable on
or before the first day of each month, in advance without adjustment or offset.
Tenant shall continue to make said monthly payments until notified by Landlord
of a change thereof. In the event that a Lender requires Landlord to make
monthly or periodic deposits to an account for the payment of Insurance Premiums
or Taxes, the amount of such required deposits to an account for the payment of
Insurance rather than being due on the date when such Taxes or Insurance
Premiums are paid. Each year when available, Landlord shall give Tenant a
statement showing the total Operating Expenses and other charges, if any, for
the Property actually incurred for the prior calendar year and Tenant's Pro Rata
Share thereof. In the event that the term of this Lease does not begin or end
coincident with the calendar year, the statement for such year shall be prorated
appropriately. In the event the total of monthly payments which Tenant has made
for the prior calendar year shall be less than Tenant's actual Pro Rata Share of
Operating Expenses, then Tenant shall pay the difference in a lump sum within
thirty (30) days after receipt of such statement from Landlord when the final
determination is made of Tenant's Pro Rata Share of Operating Expenses, even
though the Term may have expired or been terminated. Any overpayment made shall
be refunded to Tenant or, at Landlord's option, credited towards the next Basic
Monthly Rent payments coming due. In the case of the year in which the Lease
expires or terminates any overpayment will be refunded. In the event of any
adjustment by Landlord of the estimated amount of the Operating Expenses, Tenant
shall immediately commence paying the adjusted estimated amount.
4.2.2. DEFINITION of Operating Expenses. "Operating Expenses" shall
mean the total costs and expenses paid or incurred by Landlord in connection
with the ownership, operation, maintenance and repair of the Property which in
accordance with reasonable accounting and management practices consistently
applied, including , without limitation (1) Taxes; (2) Insurance Premiums (3)
the cost of utilities consumed on the Property if paid for by Landlord; (4) the
cost of any governmentally required license, permit, or inspection for or of the
Property; (5) personal property taxes on any personal property owned by Landlord
and located on the Property and used for the maintenance or operation of the
Property; (6) and any other costs and expenses of Property; (7) reasonable
property management fees not exceeding three percent (3%) of total rental
charges and (8) any other expense designated by this Lease to be an Operating
Expense. In the event of the failure of a compressor or other major element of
the heating and air conditioning system of the Property (which element is not a
consumable or designed and intended to be replaced periodically) requiring
replacement rather than maintenance, only fifty percent(50%) of the expense of
such replacement shall be included within the meaning of Operating Expenses.
Operating Expenses shall be "net" only and for that purpose shall be deemed
reduced by the amounts of any insurance reimbursement or other reimbursement
received by Landlord in connection with such expenses. The following shall not
be Operating Expenses (1) repairs or other W??????? occasioned by insured
casualty except for the deductible portion of any insured casualty loss; "(2)
leasing commissions; (3) depreciation and amortization; (4) costs of a capital
improvement nature; (5) interest on debt or principal payments to a Lender or
rental under a ground lease (other than leasehold excise tax); and (6) costs of
Landlord's general overhead.
5. SECURITY DEPOSIT. The Security Deposit shall be security for Tenant's full
performance of Tenant's lease obligations. If Tenant fails to pay rent or any
other charges due from Tenant under this Lease, Landlord may elect to apply the
Security Deposit toward the payment of such default. If Landlord applies any
portion of the Security Deposit, Tenant shall, on ten (10) days written notice,
deposit cash with Landlord in an amount sufficient to restore the Security
Deposit to the full amount stated in Section 1; Tenant's failure to do so shall
be a default. Landlord may commingle the security Deposit. If Tenant performs
all of Tenant's lease obligations, the Security Deposit (or so much as has not
been applied by Landlord) shall be returned to Tenant (or, at Landlord's option,
to the last assignee, if any, or Tenant's interest under the Lease) within a
reasonable time. Landlord may transfer the security deposit to the purchaser of
his interest in the event of sale and Tenant shall look solely to such purchaser
for return of the deposit.
6. USE.
6.1. Allowed use. The Premises shall be used and occupied only for the
Allowed Use and for no other purpose without prior written consent of Landlord,
which consent may be withheld or conditioned as Landlord deem appropriate within
its sole, unrestricted discretion. The designation of Tenant's Allowed Use shall
not be deemed to be an agreement by Landlord to refrain from leasing other
property to others for a similar use.
6.2. COMPLIANCE WITH LAW. Tenant shall, at Tenant's expense, comply
promptly with all present and future laws and requirements regulating the use of
the Premises by Tenant or Tenant's business. Landlord shall, at Landlord's
expense, comply promptly with all present and future laws and requirements
regulating the physical condition of the building containing the Premises which
are not related to the use of the Premises by Tenant or Tenant's business.
Tenant and Landlord are not related to the use of the Premises by Tenant or
Tenant's business. Tenant and Landlord agree that requirements arising from or
based on the federal Americans With Disabilities Act due to the present of
employees or members of the public in Tenant's Premises are to be deemed to be
elsewhere in this Lease. Tenant shall not create or allow waste or a nuisance,
or unreasonably disturb any other tenant or person.
6.3 INSURANCE CANCELLATION. Despite any other provision of this Lease, no
use of the Premises may be made or permitted nor acts done which will adversely
affect or increase the cost of any insurance policy maintained by Landlord.
6.4. LANDLORD'S RULES AND REGULATIONS. Tenant shall comply with reasonable
regulations made or changed by Landlord shall from time to time which
regulations shall not conflict with any express provision of this Lease.
6.5. OTHER TENANTS. Landlord shall not be responsible to Tenant for the
acts or, omissions of the other tenant or occupant of the Property.
7. MAINTENANCE, REPAIRS AND ALTERATION.
7.1. LANDLORD'S OBLIGATION. Except for damage caused or allowed by Tenant
and its employees or invitees, Landlord shall maintain, at Landlord's expense
and not as Operating Expense the structural foundations of the Premises and the
exterior roof(s) of the Premises. The term "Common Areas" refers to all areas
within the Property which are made available, from time to time, for general use
of all tenants and Landlord, which areas shall include, but not necessarily be
limited to, parking areas, driveways, sidewalks, landscaped and planted areas,
common lobbies and loading docks and the like. The Landlord shall keep or cause
to be kept the Common Areas in a neat, clean, and orderly condition, properly
lighted and landscaped and planted areas, common lobbies and loading docks and
the like. The Landlord shall keep or cause to be kept the Common Areas in a
neat, clean, and orderly condition, properly lighted and landscaped and shall
repair any damage to the facilities thereof, and all expenses in connection with
the common areas shall be Operating Expenses for which Tenant will pay its Pro
Rata Share. Operating Expenses for Common Areas general maintenance and repairs,
relocation of facilities, resurfacing, painting, striping, re-striping, cleaning
snow removal, sweeping and janitorial services, maintenance and repair of
sidewalks, curbs and Property signage, landscaping; irrigation, or sprinkling
systems, planting and maintenance (other than exterior roof and structural
foundations of the Premises) including but not limited to patching, resurfacing
and preventative maintenance and painting or renovation of the ???? heating,
ventilation and air conditioning system serving more of the Property than just
the ???? cost or expenses incurred by reason of any repairs or modifications to
the Property for energy or reserves for replacement of existing capital
improvements in the Common Areas in amounts as required by Landlord. Landlord
may cause any or all of said services to be provided by an independent
contractor or contractors. Landlord shall have no such repairs. Landlord shall
have no obligation to make any repair, change or improvement of the number of
the Premises.
7.2. TENANT'S OBLIGATIONS. Tenant, at Tenant's expense, shall maintain in
good condition and appearance all and every part of the Premises (regardless
whether the damaged portion of the Premises or the means of repairing the same
are directly accessible form the interior of the Premises). Without limiting
Tenants duty, Tenant shall so maintain (including repainting when seasonably
needed) all interior walls, any heating ventilation and air conditioning system
serving Premises, fixtures, walls, ceilings, doors, glass, and skylights located
within the agreement to maintain the Premises includes the duty to replace as
well as repair. If and as in writing by Landlord, Tenant shall contract, at
Tenant's expense, for third party periodic representative maintenance and
servicing of heating, air conditioning and ventilating equipment serving the
Premises.
7.3. INITIAL CONDITION OF PREMISES. Tenant accepts the Premises in the
condition existing when this Lease is signed. Tenant acknowledges that neither
Landlord nor the Broker has made nay representation or warranty as to (I) the
physical condition of the Premises other than Landlord represents that Landlord
is not presently aware of any existing physical condition of the Premises which
presently is legally required to be rectified or altered, or (ii) the
suitability or zoning improvements or changes to the Premises; provided,
Landlord agrees to reimburse Tenant, upon completion of the work, for the
expense of the following work to be performed by tenant's contractor under
Tenant's supervision:
7.3.1 Construction of a wall between Tenant's Premises and the
remainder of the building.
7.3.2. Installation of separate electrical (and gas if already
installed) meters for the Premises and separation of electrical wiring and
plumbing from the balance of the building.
7.3.3. Servicing of HVAC units as may be necessary so as to be
operational on the Commencement Date.
7.3.4. Improve front entrance of Premises to building standard
appearance.
7.3.5. Construction of two restrooms in accordance with applicable
code requirements.
7.3.6. Install fire sprinkler system as required under applicable
building code.
7.3.7. Re-key locks in doors in the portions of the building not
included in the premises.
7.3.8. Tenant and Landlord will reasonably cooperate with one another
to prepare plans and specifications for the foregoing work and to negotiate
acceptable financial arrangements with the contractor who is to perform the
work; if Tenant and Landlord are unable to agree on such financial arrangements
with the contractor, Landlord may elect to perform such work with a contractor
and on terms which are acceptable to Landlord.
7.4. SURRENDER. On the Termination Date of this Lease, or on any sooner
termination of this Lease, Tenant shall surrender the Premises to Landlord in
good condition and in accordance with Tenant's maintenance obligation and broom
clean, ordinary wear and tear excepted. Tenant shall patch, fill and paint any
holes resulting from attachment of any of Tenant's trade fixtures, furnishings
and equipment. Tenant shall remove any alterations or improvements made by
Tenant without the prior written approval of Landlord.
7.5. LANDLORD RIGHTS. If Tenant fails to perform Tenant's maintenance
obligations, Landlord may, at its option (but shall not be required to) enter
the Premises after ten (10) days prior written notice to Landlord or with no
prior written notice in an emergency, and perform Landlord's maintenance
obligations and Landlord shall immediately, fully reimburse Tenant for such
expense together with interest thereon at the rate of twelve percent (12%) per
annum and pay to Landlord an administrative surcharge equal to fifteen percent
(15%) of the costs so incurred by Landlord. If Landlord fails to perform
Landlord's maintenance obligations hereunder, Tenant may, at its option (but
shall not bee required to), after ten (1) days prior written notice to Landlord
or with no prior written notice in an emergency, and perform Landlord's
maintenance obligations and Landlord shall immediately, fully reimburse Tenant
for such expense together with interest thereon at the rate of twelve percent
(12%) per annum and pay to Tenant an administrative surcharge equal to fifteen
percent (15%) of the costs so incurred by Tenant.
7.6. ALTERATIONS AND ADDITIONS.
7.6.1. Without Landlord's prior written consent, Tenant shall not make
any alteration, improvements or additions to the Premises, except for
non-permanent changes costing less than Five Thousand Dollars ($5,000) in the
aggregate per year. As a condition of consent, additions at the expiration of
the term, and to restore the Premises to the prior condition; Landlord may
impose such other conditions as are reasonable; provided Tenant shall not be
required to remove any of the improvements listed in Section 7.3 for which
Landlord is to reimburse Tenant. Tenant shall secure all governmental permits
required in connection with any such work. Landlord may, at its sole option,
require Tenant, at Tenant's expense, to obtain for Landlord's benefit a surety
against any liability for liens arising from such work and to insure completion
of the work. In performing any construction on the Premises, Tenant agrees to
select a contractor from a list of contractors to be provided by Landlord, so
long as such contractor's pricing to Tenant is reasonable and competitive.
7.6.2. Before commencing any work relating to alterations, additions
and improvements affecting the Premises (non of which are required or requested
by Landlord, nor any obligation of Tenant under this Lease), Tenant shall notify
Landlord in writing of the expected date of commencement thereof. Landlord shall
then have the right at any time to maintain on the Premises such notices a s
Landlord reasonably deems necessary to protect the Premises and Landlord from
any lien. In any event, Tenant shall not permit any lien to be asserted, against
the Premises or Property for any charge incurred or alleged to have been
incurred by Tenant, and Tenant shall indemnify, defend Landlord against, and
hold Landlord harmless from any and all liability, costs, damages therefrom.
7.6.3. Unless Landlord requires removal, as provided elsewhere in this
Lease, all alterations, improvements or additions which may be made on the
Premises shall become the property of Landlord and remain upon and be
surrendered with the Premises at the expiration of the affixed to the Premises
so that it cannot be removed without material damage to the Premises, shall
remain the property of Tenant and may be removed by Tenant prior to the end of
the term of the Lease and subject to Tenant's obligations to maintain the
Premises.
8. HAZARDOUS SUBSTANCES.
8.1 As used in the Lease, the term "Hazardous Substance" means any
substance or material, the storage, use or disposal of which is or becomes
regulated under any law, now or hereafter in effect.
8.2. Landlord warrants to Tenant that Landlord has not released or
deposited on the Premises or Property Common Areas any Hazardous Substance, and
Landlord has no knowledge of the presence of any hazardous substance on the
Premises.
8.3. Without Landlord's prior written consent, Tenant shall not receive,
store or otherwise allow any Hazardous Substance on the Premises or Property. In
the event of any release or presence of any Hazardous Substances on or about the
Premises or Property occurring on or after the Commencement Date of this Lease,
Tenant agrees to immediately, fully and completely remove (and to dispose of
such in accordance with applicable law) all of such Hazardous Substance would
not require remediation under the provisions of law. Tenant further agrees to
defend, indemnify, and hold harmless Landlord, its employees, agents and
contractors and Lender from and against any and all losses, claims, liabilities,
damages, demands, fines, costs, and expenses (including reasonable attorneys'
fees) arising out of or resulting from any release or presence of any Hazardous
Substances on or about the Premises; the provisions of this sentence shall
survive (and be enforceable thereafter) the termination or expiration of this
Lease and the surrender of the Premises by Tenant. If Tenant becomes aware of
the release or presence on the Premises or Property of any Hazardous Substance,
Tenant shall immediately advise Landlord of such release or presence, and Tenant
further shall provide Landlord with copies of any reports, studies,
recommendations or requirements received by Tenant from any third person
including a governmental agency.
9. INSURANCE; INDEMNITY.
9.1. PAYMENT OF PREMIUM. "Insurance Premiums" are the actual cost of the
insurance applicable to improvements on the Property and required to be carried
by Landlord by this Lease and include, but are not limited to , requirements of
a Lender. The cost of Insurance Premiums shall be included as a portion of the
Operating Expenses of which Tenant shall pay its Pro Rata Share of Operating
Expenses.
9.2. LIABILITY INSURANCE CARRIED BY TENANT. Tenant shall obtain and keep in
force during the term of this Lease a commercial (comprehensive) liability
insurance policy protecting Tenant, Landlord and any Lender(s) whose names have
been provided to Tenant in writing (as additional insureds) against claims for
bodily injury, personal injury and property damage based upon, involving or
arising out of the ownership, use, occupancy or maintenance of the Premises and
all areas appurtenant thereto. For the purposes of this Lease, a "Lender" is a
mortgagee under a mortgage or a beneficiary under a deed of trust granted by
Landlord or Landlord's predecessor and which is a lien on the Premises. Such
insurance shall be on an occurrence basis providing single Managers or Landlords
of Premises" endorsement and contain the "Amendment of the Pollution Exclusion"
endorsement for damage caused by heat, smoke or fumes from a hostile fire. The
policy shall include coverage for liability assumed under this Lease as an
"insured contract" for the performance of Tenant's indemnity obligations under
this Lease. The limits of said insurance required by this Lease or as carried by
Tenant shall not, however, limit the liability of Tenant nor relieve Tenant of
any obligation hereunder all insurance to be carried by Tenant shall not,
however, limit the liability of Tenant nor relieve Tenant of any obligation
hereunder. All insurance carried by Landlord, whose insurance shall be
considered excess insurance only.
9.3. PROPERTY INSURANCE - BUILDING, IMPROVEMENTS AND RENTAL VALUE.
9.3.1. BUILDING AND IMPROVEMENTS. Landlord shall obtain and keep in
force during the term of this Lease a policy or policies in the name of
Landlord, with loss payable to Landlord and to any Lender(s), insuring against
loss or damage to the Property with such deductible amount as is selected by
Landlord. Such insurance shall be for full replacement cost, as the same shall
exist from time to time, or the amount required by any Lender(s), but in no
event more than the commercially reasonable and available insurable value
thereof if, by reason of the unique nature or age of the improvements involved,
such latter amount is less than full replacement cost. If the coverage is
available and commercially reasonable, Landlord's policy or policies may insure
against all risks of direct physical loss or damage (except the perils of flood
and/or earthquake), including coverage for the enforcement of any ordinance or
law regulating the reconstruction or replacement of any undamaged sections of
the Premises required to be demolished or removed by reason of the enforcement
of any building, zoning, safety or land use laws as the result of a covered
loss. Such policies may also contain an agreed valuation provision in lieu of
any co-insurance clause, waiver of subrogation, and inflation guard protection
causing an increase in the annual property insurance coverage amount by a factor
selected by the insurer.
9.3.2. RENTAL VALUE. Landlord shall also obtain and keep in force
during the term of this Lease a policy or policies in the name of Landlord, with
loss payable to Landlord and any Lender(s), insuring the loss of the full rental
and other charges (including Operating Expenses) payable by all tenants of the
Premises to Landlord for one year. Said insurance may provide that in coverage
shall be extended beyond the date of the completion of repairs or replacement of
the Premises, to provide for one full year's loss of rental revenues from the
date of any such loss. Said insurance shall contain an agreed valuation
provision in lieu of any co-insurance clause, and the amount of coverage shall
be adjusted annually to reflect the projected payments payable by Tenant for the
next 12-month period.
9.3.3. INCREASES CAUSED BY TENANT. Tenant shall pay for any increase
in the premiums charged to Landlord for the Property or Common Areas if said
increase is caused by Tenant's acts, omissions, use or occupancy of the
Premises.
9.4. TENANT'S PROPERTY INSURANCE. Tenant at its own cost shall maintain
insurance coverage on all of Tenant's personal property, trade fixtures and
Tenant-owned alterations and improvements in the Premises similar in coverage to
that required by this Lease to be carried by Landlord. Such insurance shall be
full replacement cost coverage with a deductible not to exceed Five Thousand
Dollars ($5,000) per occurrence. The proceeds from any such insurance shall be
used by Tenant for the replacement of personal property, trade fixtures and the
restoration of any Tenant owned improvements. Upon request from Landlord, Tenant
shall provide Landlord with written evidence that such insurance is in force.
9.5. INSURANCE POLICIES. Insurance required hereunder shall be in companies
duly licensed to transact business in the state where the Premises are located,
and maintaining during the policy term a "General Policyholders Rating" of at
least B+, V or such other rating as may be required by a Lender, as set forth in
the most current issue of "Best's Insurance policies maintained by Landlord.
Tenant shall cause to be delivered to Landlord, within seven (7) days after the
earlier of the Early Possession Date or the Commencement Date, certified copies
of, or certificates evidencing the existence and amounts of , the insurance
required of Tenant by this Lease. No such policy shall be cancelable or subject
to modification except after thirty (30) days' prior written notice to Landlord.
At least thirty (30) days prior to the expiration policies, Tenant shall furnish
Landlord with evidence or renewals or "insurance binders" evidencing renewal
thereof, or Landlord may obtain such insurance and charge the cost thereof to
Tenant, which amount shall be payable by Tenant to Landlord upon demand.
9.6. WAIVER OF SUBROGATION. Without affecting any other rights or remedies,
Tenant and Landlord each hereby release and relieve the other, and waive their
entire right to recover damages (whether in contract or in tort) against the
other, for loss or damage to their property arising out of or incident to the
perils required to be insured against under this Lease to the actual extent of
the insurance actually maintained. Landlord and Tenant agree to have their
respective insurance may have against Landlord or Tenant, as the case may be, so
long as the insurance is not invalidated thereby.
9.7. INDEMNITY.
9.7.1. BY TENANT. Except to the extent of Landlord's comparative
negligence or breach of an express provision of this Lease, Tenant shall
indemnify, protect, defend and hold harmless the Landlord and its Lenders from
and against claims, loss of rents and damages, costs, liens, judgments,
penalties, loss of permits, attorneys' and consultants' fees, expenses and
liabilities arising out of, involving, or in connection with, the occupancy of
the Premises or Property by Tenant, the conduct of Tenant's business, any act,
omission or neglect of Tenant, its agents, contractors, employees or invitees,
and out of any Default or ▇▇▇▇▇ by Tenant in the performance in a timely manner
of any obligation on Tenant's part to be performed under this Lease. The
foregoing shall include, but not be limited to, the defense or pursuit of any
claim or any action or proceeding involved therein, and whether or not (in the
case of claims made against Landlord) litigated or reduced to judgment. In case
any action or proceeding be brought against Landlord by reason of any of the
foregoing matters, Tenant upon notice from Landlord shall defend the same at
Tenant's expense by counsel reasonably satisfactory to Landlord and Landlord
shall cooperate with Tenant in such defense. Landlord need not have first paid
any such claim in order to be so indemnified. In the event of concurrent
negligence of Landlord and Tenant, resulting in injury or damage to persons or
property and which relates to the construction, alterations, repair, addition
to, subtraction from, improvement, to or maintenance of the Premises, the
indemnifying party's subtraction from, improvement to or maintenance of the
Premises, the indemnifying party's obligation to indemnify the other party as
set forth in the Section shall be limited to the extent of the indemnifying
party's negligence, and that of its agents, employees, subleases, invitees,
licensees or contractors.
9.7.2. BY LANDLORD. Except to the extent of Tenant's comparative
negligence or breach of an express provision of this Lease, Landlord shall
indemnify, protect, defend and hold harmless the Tenant from and against all
claims, loss of rents and damages, costs, liens, judgments, penalties, loss of
permits, attorneys' and consultants' fees, expenses and liabilities arising out
of, involving, or in connection with, the wrongful acts of act, omission or
neglect of Landlord, and out of any Default or Breach by Landlord in the
performance in a timely manner of any obligation on Landlord's part to be
performed under this Lease. The foregoing shall include, but not be limited to,
the defense or pursuit of any claim or any action or proceeding involved
therein, and whether or not (in the case of claims made against Tenant)
litigated or reduced to judgment. In case any action or proceeding be brought
against Tenant by reason, of any of the foregoing matters, Landlord upon notice
from Tenant shall defend the same at Landlord's expense by counsel reasonably
satisfactory to Tenant and Tenant shall cooperate with Landlord in such defense.
Tenant need not have first paid any such claim in order to be so indemnified. In
the event of concurrent negligence of Tenant and Landlord resulting in injury or
damage to persons or property and which relates to the construction,
alterations, repair, addition to, subtraction from, improvement to or
maintenance of the Premises, the indemnifying party's obligation to indemnify
the other party as set forth in this Section shall be limited to the extent of
the indemnifying party's negligence, and that of its agents, employees,
subleases, invitees, licensees or contractors.
9.8. EXEMPTION OF LANDLORD from Liability. Landlord shall. not be liable
for injury or damage to the person or property of Tenant, Tenant's employees,
contractors, invitees, customers, or any other person in or about the Premises
or Property, 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, fire sprinklers, wires, appliances,
plumbing, air conditioning or lighting fixtures, or from any other cause,
whether said injury or damage results from conditions arising upon the Premises
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 accessible or not.
Notwithstanding Landlord's negligence or breach of this Lease, Landlord shall
under no circumstances be liable for any loss of income or profit of Tenant's
business or any other consequential damage.
10. Damage OR Destruction.
10.1. PARTIAL DAMAGE - INSURED. If the Premises or Property are Partially
Damaged and such damage was caused by a casualty covered under an insurance
policy required to be maintained by Tenant or Landlord pursuant to this Lease,
Landlord shall. repair such damage as soon as reasonably possible, and this
Lease shall continue in full force and effect. If, however, if the insurance
proceeds actually available to Landlord (after deduction of any proceeds
required by a Lender to be applied to reduction of indebtedness) are not
sufficient to effect such repair, Landlord shall not be obligated to make such
repairs unless Tenant elects, without obligation to do so, to contribute,
without right of reimbursement, the required amount. In the event that Landlord
is not obligated and does not voluntarily agree to repair such damage, either
Tenant or Landlord may declare this Lease terminated by thirty (30) days written
notice to the other party.
10.2. DAMAGE - UNINSURED. In the event the Premises are damaged or
destroyed by a casualty which is not covered under an insurance policy required
to be maintained by Tenant or Landlord, the Landlord may elect to repair such
damage as soon as reasonably possible, and this Lease shall continue in full
force and effect. If Landlord does not so elect within sixty (60) days after the
occurrence of the casualty to repair, either Tenant or Landlord may declare this
Lease terminated by ten (10) days written notice to the other party; provided
Tenant may avoid termination of this Lease if Tenant voluntarily agrees to pay,
without right of reimbursement, all of the costs of such repairs by Landlord.
10.3. TOTAL DESTRUCTION. If the Premises are Totally Destroyed by a
casualty covered under an insurance policy required to be maintained by Tenant
or Landlord pursuant to this Lease, this Lease shall automatically terminate as
of the date of such total destruction.
10.4. DAMAGE NEAR END OF TERM. If the premises are Partially Damaged during
the last two (2) years of the term of this Lease, Landlord may, at Landlord's
option, cancel and terminate this Lease as of the date of occurrence of such
damage by giving written notice to Tenant of Landlord's election to do so within
thirty (30) days after Landlord receives notice of occurrence of such damage;
provided Landlord shall continue to have all rights to receive the proceeds of
any insurance policy required by the Lease to be maintained by Tenant.
10.5. ABATEMENT OF RENT. If the Premises are Partially Damaged, the rent
payable while such damage, repair or restoration continues shall be abated in
proportion to the degree to which Tenant's reasonable use of the Premises is
substantially impaired. Except for abatement of rent, if any, Tenant shall have
no claim against Landlord for any damage suffered , by reason of any such
damage, destruction, repair or restoration.
10.6 DEFINITIONS. For purposes of this Lease, the term Partially Damaged
shall be deemed to mean damage to the Premises or Property (excluding any damage
to Tenant owned property or alterations) which is reasonably estimated to cost
to repair less than fifty percent (50%) and Totally Destroyed shall be deemed to
mean damage to the Premises or Property (excluding any damage to Tenant owned
property or alterations) which is reasonably estimated to cost to repair more
than fifty percent (50%) of the reasonable fair market value of the improvements
constituting the Premises or Property (but not the land) calculated immediately
prior to the occurrence of the damage. Cost shall include the cost to rebuild
all of the damaged improvements owned by Landlord including demolition, debris
removal, requirements of applicable building codes and other laws, mitigation
requirements and without regard for depreciation.
11. TAXES.
11.1. TAXES. Landlord shall pay all Taxes applicable to the Property, the
amount of which shall be included In calculating the total of Operating
Expenses. If any Taxes cover any period of the time prior to or after expiration
of the term hereof, Tenant's share of such taxes shall be equitably prorated to
cover only the period of time within which this Lease shall be in effect. As
used herein, the term Taxes shall include any form of required payment,
assessment, license fee, tax on rent, levy, penalty, or tax (other than
Landlord's net income tax and inheritance or estate taxes) imposed by any
authority having the direct or indirect power to tax any legal or equitable
interest of Landlord in the Property or Landlord's right to rent or other income
therefrom. If Landlord deems such action to be warranted, the cost of contesting
any Taxes or assessment affecting the Property shall be an Operating Expense.
11.2. PERSONAL PROPERTY TAXES. Tenant shall pay prior to delinquency all
taxes assessed against and levied on any leasehold improvements, fixtures,
furnishings, equipment and other property of Tenant. Tenant shall cause such
Tenant property to be assessed separately from Landlord's Property or reimburse
Landlord for the taxes attributable to Tenant within ten (10) days after receipt
of a written statement from Landlord setting forth the taxes applicable to
Tenant's property.
12. TENANT'S COMMON AREA RIGHTS AND OBLIGATIONS. During the Lease term, Tenant
has a non-exclusive license to use the Common Areas as they from time to time
exist, subject to the rights reserved by Landlord. Storage, either permanent or
temporary, of any materials, supplies or equipment in the Common Areas is
prohibited. Landlord shall have the right to designate one or more areas for
parking of employees of Tenant and other tenants and to establish reasonable
parking regulations, weight limits and access routes to be used by trucks. When
requested by Landlord, Tenant shall. furnish a list of the license numbers of
its motor vehicles and of Its employees'. Tenant shall not at any time park or
permit the paring of motor vehicles, belonging to it or to others, so as to
interfere with the pedestrian sidewalks, roadways and loading areas, or in any
portion of the parking areas not designated by Landlord for such use by Tenant.
Tenant shall repair, at its cost, all deterioration of or damage to the Common
Areas occasioned by its lack of ordinary care or violation of Landlord's rules
or instructions.
13. UTILITIES. Tenant shall pay for all water, gas, drainage service, sewer
service, garbage service, 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 Tenant, Tenant shall pay its Pro Rata
Share of such utilities as Operating Expenses. If the Landlord shall determine,
the exercise of Landlord's good faith review, that the Tenant's use of utilities
is in excess of that normally used by a tenant occupying similar space, then
Tenant shall pay Landlord upon demand as additional rent, the cost of such
excess utility usage in addition to any other rent or charge due from Tenant
under this Lease. In no event shall Landlord be liable for an interruption or
failure in the supply of any such utilities to the Premises.
14. ASSIGNMENT AND SUBLETTING.
14.1. Landlord's Consent Required. Tenant shall not voluntarily or by
operation of law assign, transfer, mortgage, sublet, or otherwise transfer or
encumber all or any part of Tenant's interest in this lease or the Premises
without Landlord's prior written consent, which consent may be conditioned, in
addition to any other reasonable conditions, on a written assumption by the
assignee or sublessee of the obligations of Tenant, a written guarantee of
payment and performance by Tenant and a consent or reaffirmation of any
guarantor of Tenant. Any purported assignment, transfer, mortgage, encumbrance,
or subletting without consent shall be void and constitute a breach of this
Lease. In the event that Tenant is not a natural person, then any transfer (or
the aggregate of a series of transfers) of thirty percent (30%) or more of the
beneficial ownership of Tenant shall be deemed a prohibited assignment; in the
event of the sale of one hundred percent (100%) of the beneficial ownership of
Tenant, Landlord agrees to not unreasonably withhold its consent to such
assignment provided Landlord is provided with reasonably acceptable information
regarding the creditworthiness of the assignee, the assignee assumes all of
Tenant's obligations under this Lease and Tenant and Tenant's guarantor remain
fully obligated to pay or perform all of Tenant's obligations under this Lease.
No option to renew or extend, if any, may be assigned by Tenant and no assignee
or subtenant shall have any right to exercise any such option. The acceptance of
rent by Landlord from a person other than Tenant shall not be deemed to be a
waiver by Landlord of any provision hereof. Consent to one assignment or
subletting shall not be deemed consent to any subsequent assignment or
subletting.
14.2. NO RELEASE OF TENANT. Regardless of Landlord's consent, no subletting
or assignment shall release Tenant's primary obligation to pay or perform any
obligation under this Lease.
14.3. Assignment Fee. In the event that Landlord shall consent to a
sublease or assignment under Article 14.1, Tenant agrees to reimburse Landlord
for the reasonable out-of pocket expenses incurred by Landlord in connection
with such consent.
14.4. Assignment by Landlord. Landlord shall be permitted freely to assign
all of its rights and obligations hereunder. In the event of a sale or other
transfer of the Premises, whether by foreclosure or otherwise, the Tenant agrees
to attorn to the new owner and to recognize such owner as the Landlord under
this Lease and Tenant shall thereafter look solely to such transferee for
performance of this Lease
15. DEFAULTS; REMEDIES.
15.1. Defaults. The occurrence of any one or more of the following events
shall constitute a default and breach of this Lease by Tenant-
15.1.1. The vacation or abandonment of the Premises by Tenant.
15.1.2. The failure by Tenant to make any payment required to be made
by Tenant hereunder, as and when due where such failure shall continue for a
period of three (3) days after written notice thereof from Landlord to Tenant.
15.1.3. The failure by Tenant to observe or perform any of the
provisions of this Lease (other than the payment of money) to be observed or
performed by Tenant where such failure shall continue for a period of ten (10)
days after written notice thereof from Landlord to Tenant; provided, however,
that if the nature of Tenant's default 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 commenced such cure within said thirty (30) day period and
thereafter diligently prosecutes such cure to completion.
15.1.4. The making by Tenant or any guarantor of Tenant of any general
assignment, or general assignment for the benefit of creditors; (ii) the filing
by or against Tenant or any guarantor of Tenant of a petition to have Tenant
adjudged a bankrupt or 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 sixty (60) 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, where possession is not
restored to Tenant within ten (10) days; or (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 such seizure is not
discharged within ten (10) days
15.2 Remedies in Default. Upon the occurrence of a Default by Tenant,
Landlord, without notice to Tenant (except where expressly ;provided for in this
Lease or by applicable law) may do any one or more of the following:
15.2.1 Elect to terminate this Lease and the tenancy created hereby by
giving notice of such election to Tenant, and reenter the Premises, without the
necessity of legal proceedings, and remove Tenant and all other persons and
property from the Premises, and may store such property in a public warehouse or
elsewhere at the cost of and for the account of Tenant without resort to legal
process and without Landlord being deemed guilty of trespass or becoming liable
for any loss or damage occasioned thereby; and
15.2.2 Exercise any other legal or equitable right or remedy which it
may have.
15.3 Damages. If this Lease is terminated by Landlord pursuant to this
section, Tenant nevertheless shall remain liable for (a) an rents and damages
which may be due or sustained prior to such termination, all reasonable costs,
Ls and expenses including, but not limited to, reasonable attorneys' fees, costs
and expenses incurred by Landlord in pursuit or its remedies hereunder, or in
renting the Premises to others from time to time until the original Termination
Date of this Lease (all such rents, damages, costs, fees and expenses being
referred to herein as "Termination Damages"), and (b) additional damages
("Post-Termination Damages"), which Post-Termination Damages, at the election of
Landlord, shall be either:
15.3.1. an amount equal to the rents which, but for termination of
this Lease, would have become due during the remainder of the Term, less the
amount of rents, If any, which Landlord shall receive during such period from
others to whom the Premises may be rented, in which case such Post-Termination
Damages shall be computed and payable in monthly installments, in advance, on
the first day of each calendar month following termination of the Lease and
continuing until the date on which the Term would have expired but for such
termination, and it or action brought to collect any such Post-Termination
Damages for any month shall not in any manner prejudice the right of Landlord to
collect any Post-Termination Damages for any subsequent month by a similar
proceeding; or
15.3.2. an amount equal to the present worth (as of the date of such
termination) of rents which, but for termination of this Lease, would have
become due during the remainder of the Term, less the fair rental value of the
Premises, as determined by an independent real estate appraiser named by
Landlord, in which case such Post-Termination Damages shall be payable to
Landlord in one lump sum on demand and shall bear interest at the Default Rate
until paid. For purposes of this section, "present worth" shall be computed by
discounting such amount to present worth at a discount rate equal to one
percentage point above the discount rate then in effect at the Federal Reserve
Bank nearest to the Premises; provided that Tenant may avoid the application of
this section so long as Tenant voluntarily agrees to pa and, in fact, does pay
all sums due to date under the immediately preceding section within forty-five
(45) days of receipt of notice of Landlord's declaration of the termination of
this Lease and Tenant continues thereafter to pay such amounts monthly until the
Termination Date.
15.4. Miscellaneous. If Landlord elects to terminate this Lease following
the default of Tenant, Landlord may relet the Premises or any part thereof,
alone or together with other premises, for such term or terms (which may be
greater or less than the period which otherwise would have constituted the
balance of the Term) and on such terms and conditions (which may include
concessions or free rent, alterations of the Premises and payment of brokers) as
Landlord, in its sole in the total of Landlord's discretion, may determine, and
the costs thereof shall be included Termination Damages which shall be paid by
Tenant. Nothing contained in this Lease shall limit or prejudice the right of
Landlord to prove for and obtain, in proceedings for the termination of this
Lease by reason of bankruptcy or insolvency, an amount equal to the maximum
allowed by any statute or rule of law in effect at the time when, and governing
the proceedings in which, the damages are to be proved, whether or not the
amount be greater, equal to, or less than the amount of the loss or damages
referred to above. The failure or refusal of Landlord to relet the Premises or
any part or parts thereof shall not release or affect Tenant's liability for
damages.
15.5. Default by Landlord. Landlord shall not be in default unless Landlord
fails to perform obligations required of Landlord within a reasonable time, but
in no event sooner than thirty (30) days after written notice by Tenant to
Landlord and any Lender whose name and writing, specifying wherein Landlord has
failed to perform such obligation; provided, however, that the nature of the
Landlord's obligation is such that more than (30) days are required for
performance, then Landlord shall not be in default if Landlord commences
performances within such thirty (30) day period and thereafter diligently
prosecutes the same to completion.
15.6. Late Charges and Interest. Tenant hereby acknowledges that late
payment by Tenant to Landlord of any sum due tinder this Lease will cause
Landlord to incur costs not contemplated by this Lease and the amount of which
is difficult to predict in advance. Accordingly, if any sum due from Tenant
shall not be received by Landlord within ten (10) days after that said amount is
due, then Tenant shall pay to Landlord a late charge of five percent (5%) of
such overdue amount. In addition, any amount due to Landlord not paid when due
shall bear interest at twelve percent (12%) per annum ("Default Rate") from the
due date. Payment of such interest or late charge shall not excuse or cure any
default by Tenant under this Lease. In the event that a check from Tenant is
returned unpaid by Tenant's bank, Tenant shall pay an additional returned check
charge of twenty five dollars ($25) which Tenant agrees is reasonable and which
is in addition to a late charge and interest charges if otherwise applicable.
15.7 Cure by Landlord. Landlord, at any time after Tenant commits a
default, may cure the default at Tenant's cost. If Landlord at any time pays any
sum or does any act that requires the payment of any sum, repayment of the sum
paid by Landlord shall be due immediately from Tenant together with interest at
the Default Rate.
15.8. Condemnation. If all of the Premises or any portion of the Premises
which is reasonably necessary for the reasonably convenient use of the Premises
are taken under the power of eminent domain, or sold by Landlord under the
threat of the exercise of said power (all of which is in referred to in this
Lease as "condemnation") or if more than twenty-five percent (25%) of the floor
area of all buildings constituting the Property, or more than fifty percent
(50%) of the parking areas on the Property is taken by condemnation, either
Landlord or Tenant may terminate this Lease as of the date the condemning
authority takes possession by notice in writing of such election within twenty
(20) days after Landlord shall have notified tenant of the taking, or, in the
absence of such notice, then within twenty (20) days after the condemning
authority shall have taken possession; provided Landlord may avoid termination
of the Lease by Tenant by providing, within a reasonable time, a substantially
similar replacement for the facilities so taken. If this Lease is not terminated
by either Landlord or Tenant then it shall remain in full force and effect as to
the portion of the Premises remaining, provided the Basic, Monthly Rent shall be
reduced by the proportion to the floor area of the Premises taken by
condemnation bears to the total floor area of the Premises. All awards for the
taking of any part of the Premises or any payment made under the threat of the
exercise of power of eminent domain shall be the property of Landlord, whether
made as compensation for diminution of value of the leasehold or for the taking
of the fee or as severance damages; provided, however, that Tenant shall be
entitled to any separately made award for loss of or damage to Tenant's trade
fixtures and removable personal property.
16. General Provisions
16.1. Reasonableness of Consent. Whenever the consent of Landlord or Tenant
is required by the terms of this Lease, such consent shall not be unreasonably
withheld or delayed although it may be subject to reasonable conditions.
16.2. Payments Are Rent. All payments due to Landlord from Tenant shall be
deemed to be rent due under this Lease.
16.3. ESTOPPEL CERTIFICATE.
16.3.1. Tenant shall, at any time, on not less than ten (10) days
prior written notice from Landlord, sign and deliver to Landlord 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, security deposit, and other charges are paid in advance, if any,
and (ii) acknowledging that there are not, to Tenant's knowledge, my uncured
defaults on tile part of Landlord or Tenant under this lease, or specifying such
defaults, if any, which are claimed, and agreeing to give reasonable written
notice to a Lender of any future default. Any such statement may be conclusively
relied upon by any prospective purchaser or encumbrancer of the Premises
16.3.2. Tenant's failure to deliver such statement within such time
period 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 (1) month's rent has been paid in advance.
16.3.3. If Landlord desires to sell, finance or refinance the
Property, or any part thereof, Tenant hereby agrees to deliver to any Lender
designated by Landlord such financial statements of Tenant as may he reasonably
required by such Lender. Such statements shall include the past three (3) years
financial statements of Tenant. All such financial statements shall be received
by Landlord in confidence and shall be used only for the purposes herein set
forth.
16.4. Landlord's Interest. The term "Landlord" as used herein shall mean
only the owner or owners at the time in question of the fee title, vendee's
interest under a real estate contract, or a tenant's interest in a ground lease
of the Premises. In the event of any transfer of such title or interest,
Landlord herein named (and in case of any subsequent transfers the then grantor)
shall be relieved from and after the date of such transfer of all liability as
respects Landlord's obligations thereafter to be performed, provided that any
funds in the hands of Landlord or the then grantor at the time of such transfer,
in which Tenant has an interest, shall be delivered to the grantee. The
obligations contained in this Lease to be performed by Landlord shall be binding
upon Landlord's successors and assigns, only during their respective periods of
ownership.
16.5. Tenant Signage. At Tenant's own expense, Tenant may place one or more
signs on the Property so long as (1) Tenant has obtained Landlord's prior
written consent for the specific sign proposed by Tenant, (ii) such sign(s)
conform to all applicable governmental rules and regulations, Tenant maintains
such sign is good condition and appearance and (1v) at the termination of this
Lease, Tenant shall remove alf such signs and repair any damage caused by such
sign or its removal at Tenant's sole expense.
16.6. 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.
16.7. Time of Essence. Time is of the essence.
16.8. Captions. Article and paragraph captions are for convenience only are
not a part of this Lease.
16.9. Incorporation of Prior Agreement; 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.
16.10. Waiver. No waiver by 1andlord of any provision hereof shall be
deemed a waiver of any other provision hereof or of any subsequent breach by
Tenant of the same or any other provision. Landlord's consent to or approval of
any act shall not be deemed to render unnecessary the obtaining of Landlord's
consent to or approval of any subsequent act by Tenant. The acceptance of rent
hereunder by Landlord shall not be a waiver of any preceding breach by Tenant of
any provision hereof, other than the failure of Tenant to pay the particular
rent so accepted regardless of Landlord's knowledge of such preceding breach at
the time of acceptance of such rent.
16.11. RECORDING. Tenant shall not record this Lease or allow the filing of
a UCC financing statement containing the legal description of the Property
without Landlord's prior written consent, and such recordation or filing shall,
at the option of Landlord, constitute a noncurable default of Tenant hereunder.
16.12. HOLDING OVER. If Tenant remains in possession of the premises or any
part thereof after the expiration of the term hereof without the express written
consent of Landlord, such occupancy shall be a tenancy from month to month at a
rental equal to one hundred twenty-five percent (125%) of the Basic Monthly Rent
due for the last month of the Lease term plus all other charges payable
hereunder, and upon the terms hereof applicable to a month to month tenancy.
16.13. 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.
16.14. Covenants and Conditions. Each provision of this Lease performable
by Tenant shall be deemed both a covenant and a condition.
16.15. Binding Effect; Choice of Law; Proration. Subject to any provisions
hereof restricting assignment or subletting by Tenant or as may be expressly
provided in this Lease, this Lease shall bind the parties, their personal
representatives, successors and assigns. This Lease shall be governed by the
laws of the state where the Premises are located.
16.16. Subordination.
16.16.1. This Lease, at Landlord's option, shall be subordinate to any
ground lease, mortgage, deed of trust, or any other hypothecation for 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,
notifications, consolidations, replacements and extensions thereof If any Lender
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 Tenant, this Lease shall be deemed prior to such mortgage, deed of trust, or
ground lease, regardless whether this Lease is dated prior or subsequent to such
mortgage, deed of trust or ground lease, or the late of recording thereof.
16.16.2. Provided that the mortgagee or beneficiary, as the case may
be, shall agree to recognize this Lease in the event of foreclosure if Tenant is
not in default at such time subject to such provisions relating to the
disposition or application of insurance or condemnation proceeds as may be
contained in such mortgagee or beneficiary's loan documents, Tenant agrees to
execute any documents required to effectuate such subordination or to make this
Lease prior to the lien of any mortgage, deed of trust or ground lease, as the
case may be, and failing to do so within ten (10) days after written demand,
does hereby make, constitute and irrevocably appoint Landlord is Tenant's
attorney-in-fact and in Tenant's name, place and stead, to do so.
16.17. ATTORNEYS Fees. If Tenant or Landlord 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 attorneys fees
to be paid by the losing party as fixed by the court.
16.18. LANDLORD'S ACCESS. Landlord and Landlord's agents shall have the
right to enter accompanied by the Tenant's representative except in the case of
an emergency) the Premises at reasonable times for the purpose of inspecting the
same, showing the same to prospective purchasers or Lenders, and making such
alterations, repairs, improvements or additions to the premises or to the
building of which they are a part as Landlord may deem necessary or desirable.
landlord may at any time place on or about the Premises signs advertising the
availability for sale of the Property or a portion thereof, and, during the last
one hundred twenty (120) days of the term of this Lease, Landlord may place
signs on the Premises advertising the availability for lease of the premises so
long as such signs do not unreasonably obscure Tenant's existing signs
identifying its business.
16.19. AUCTIONS. Tenant shall not advertise or conduct any auction or going
out of business ale in the Premises.
16.20. CORPORATE AUTHORITY. If Tenant is a legal entity, each individual
executing this ease on behalf of such entity represents and warrants that he or
she is duly authorized to execute ad deliver this Lease on behalf of such entity
and that this Lease is binding upon such entity in accordance with its terms.
16.21. LANDLORD'S LIABILITY. Any claim by Tenant against Landlord shall be
limited to the Landlord's interest in the Property, and Tenant expressly waives
any and all rights to proceed against any other assets of Landlord or any owner
of Landlord.
16.22. NOTICES. Wherever under this Lease provision is made for any demand,
notice or declaration of any kind, or where it is deemed desirable or necessary
by either party to give or serve any such notice, demand or declaration to the
other party, it shall be in writing and served either personally or sent by
United States mail, postage prepaid, addressed to the address stated at the
beginning of this Lease or such subsequent address as may have been specified
for such purpose in written notice given to the other party.
16.23. CONFIRMATION OF TERMINATION OF PREDECESSOR LEASE. The Premises (and
other property) previously have been lease by Landlord to a now bankrupt
company, Virtual Vision, from which Tenant has obtained some of its assets.
Tenant and Landlord confirm and warrant to each her that the prior lease has
been fully terminated, and that Tenant has no claim or right of use of any
portion of Landlord's Property except the Premises as defined in this Lease and
in accordance 1h this Lease.
16.24. SPECIAL ARTICLES. The following Schedules are attached and are a
part of this Lease:
Guaranty of Lease
Schedule 1.3, Floor Plan and Legal Description
Schedule 1.5, Increases of Basic Monthly Rent in Accordance
with Changes in Consumer Price Index
8.4. Guarantor has requested that Landlord agree to the terms of this Lease
and Guaranty for the benefit of Guarantor.
The individual executing this Guaranty of Lease on behalf of Telxon Corporation
personally represents and warrants that he or she is duly authorized to execute
and deliver this Guarantee of Lease on behalf of Telxon Corporation and that
this Guaranty of Lease 1's binding upon such entity in accordance with its
terms.
Guarantor:
Telxon Corporation,
a Delaware Corporation
BY
Its
In the event Guarantor has paid to Landlord any sum due hereunder, Guarantor
shall have and be entitled to exercise all the rights of the Tenant under the
Lease. To the extent that Guarantor brings the obligations of Tenant current,
and maintains those obligations, Guarantor has the right to use and occupy the
Premises, by sublease, assignment, or otherwise, without the necessity of
obtaining consent from the Landlord but subject to the other terms and
conditions of the Lease.
GUARANTY OF LEASE
1. To induce and as consideration for Redson Building Partnership, a Washington
general partnership, ("Landlord") to enter into the foregoing lease ("Lease") of
which this Guaranty is an exhibit, the undersigned (who is referred to herein as
"Guarantor") irrevocably guarantees to Landlord, its successors and assigns, the
full and due performance by the Tenant, and by its successors and assigns, of
all the terms, obligations, covenants and agreements under the Lease, and each
of them, on the part of Tenant, its successors, assigns and subtenants to be
observed or performed, and, without limiting the foregoing, the full and
punctual payment by Tenant and its successors, assigns and subtenants of all
rentals, additional rentals and other sums of money as and when they become due
and payable as provided in the Lease throughout the Lease, including any
extension or renewal of the Lease. The Lease is incorporated herein by this
reference as though set out in full in the Guaranty.
2. The Guarantor waives notice of acceptance of this Guaranty and agrees that
this Guaranty shall be a continuing guaranty.
3. Notice of any and all defaults on the part of Tenant, and any successor,
assignee or subtenant of Tenant or of the foregoing, is waived, and consent is
given to all extensions of time, waivers or indulgences of any kind, that
Landlord, its successors or assigns, may grant to Tenant, and any successors,
assignee or subtenants of Tenant or of the foregoing with reference to the
performance by Tenant or any successor, assignee or subtenant of Tenant or of
the foregoing, of any of the terms, obligations, covenants or agreements in or
under the Lease. Full consent is also given by the Guarantor to any and all
changes, modifications or amendments in, of or to any such terms, obligations,
covenants or agreements as well as to conditions of, in or under the Lease that
may be made by agreement between Landlord or its successors or assigns and
Tenant or any successor, assignee or subtenant of Tenant or of the foregoing, or
otherwise; and the Guarantor waives any and all requirements whatsoever on the
part of Landlord or its successors or assigns first to exhaust or pursue its, or
their, remedies against Tenant, its successors or assigns, before Landlord or
its successors or assigns shall have the right to proceed directly, and recover
against, the Guarantor.
4. The Guarantor, without limiting any of the provisions of this Guaranty, also
waives notice of any and all changes, modifications or amendments in, of or to
the Lease, that may be agreed upon between Landlord or Landlord's successors or
assigns and Tenant, or successors, assigns or subtenants of Tenant's or of the
foregoing, or that may be permitted or suffered in connection with lease, or the
performance thereof, as well as notice of any waivers, indulgences or extensions
granted or suffered by Landlord or its successors or assigns. The Guarantor
further agrees that, notwithstanding any waivers, extensions or indulgences
granted or suffered by Landlord, or successors or assigns, and notwithstanding
any changes, amendments or modifications in, of or to the Lease, by agreement or
otherwise, the Guarantor shall be and remain, and absolutely and fully liable to
Landlord and its successors and assigns for the full and punctual payment of all
rentals, additional rentals and other payments to be made, and for the full and
due performance of all the other terms, obligations, covenants, agreements and
conditions of, in or under the lease, and in any change, amendment or
modification thereof, by Tenant and its successors and assigns, without any
notice whatsoever.
5. Without limiting any of the provisions of this Guaranty, the Guarantor
further agrees that this Guaranty, and the obligations of the Guarantor under
it, shall in no wise be terminated, affected or impaired by reason of the
assertion by Landlord, its successors or assigns against Tenant, its successors
or assigns, of any rights or remedies reserved to the Landlord pursuant to or by
virtue of the provisions of the Lease or any change, amendment or modification
of the Lease.
6. The references in this Guaranty to Tenant's successors and assigns shall not
be deemed a waiver by Landlord, its successors or assigns, of any prohibition or
restriction in the Lease relating to the assignment of the Lease.
7. This Guaranty is executed by the Guarantor to induce Landlord to execute and
deliver the Lease well knowing that Landlord would not do so without this
Guaranty.
8. Guarantor represents to Landlord that all of the following statements are
factually true and accurate:
8.1. Guarantor is financially interested in the operation of a
business which is expected to be operated at the leased Premises and seeks
financial benefit from Landlord's agreement to lease the Premises to Tenant
on the basis of this Lease and Guarantee.
8.2. Guarantor has read and understands all of the Lease and this
Guarantee, and understands that this Guarantee is legally binding on
Guarantor regardless of any future events.
8.3. Guarantor knows that its obligations and liability on this
Guarantee will not terminate when or if Guarantor's involvement, financial
or otherwise, in the leased Premises may terminate; instead Guarantor will
remain liable to Landlord even though the leased Premises are leased,
assigned or subleased to someone else.
Subject to the 36 month time limit set forth in #1 above.
Schedule 1.3
Legal description of the Property
PARCEL A:
That portion of Lot 10, Redmond Science Center, according to the plat thereof
recorded in Volume 124 of Plats, pages 70 and 71, records of King County,
Washington, lying Northerly of the following described line:
Beginning of the Southwest corner of said Lot 10;
Thence South 98'33'31" East along the South line of said Lot 10, a distance of
30.39 feet; Thence North 60137'49" East, 78.10 feet;
Thence North 29'36'04" West, 16.40 feet;
Thence North 60'41'38" East, 57.06 feet;
thence North 70'58'16" East, 28.37 feet;
Thence North 60016'00" East, 65.42 feet to the Easterly line of said Lot 10 and
the terminus of this described line);
(also known as revised Lot 4 in lot line revision City of ▇▇▇▇▇▇▇ No. LLR
93-004, recorded under King County Recording No. 9311309017.)
PARCEL B:
----------------------------------
Easements pursuant to a cross access easement agreement dated February 24, 1994,
under Recording No. 9402241864, and an access easement agreement dated February
24, 1994, under Recording No. 9402241865.
Both situate in the County of King, State of Washington.
Schedule 1.5
Increases of Basic Monthly Rent
in Accordance with Changes In Consumer Price Index
The Basic Monthly Rent shall be adjusted periodically in accordance with
the terms of this Schedule 1.5:
1. Price Index. For purposes of calculating adjustments of the Basic
Monthly Rent, "Price Index" shall mean the Consumer Price Index-All Urban
Consumers: U.S. City Average All Items, (1982-84=100) published by the
United States Department of Labor, Bureau of Labor Statistics. If this
index is discontinued, the parties shall select another similar index which
reflects consumer prices; if the parties cannot agree on another index, the
then Presiding Judge of the Superior Court for the count in which the
Premises are located, upon an appropriate request which either party may
make, shall designate the replacement index.
2. Adjustments to Basic Monthly Rent. On the first day of the
thirty-seventh (37th) month of the term of this lease and every twelve (12)
months thereafter ("Rent Adjustment Date"), the Basic Monthly Rent shall be
increased by the lower of
2.1 Three percent (3%) per year from the later of (i) the
Commencement Date of the Lease or (ii) the last date on which the
amount of the Basic Monthly Rent was adjusted in accordance with this
Schedule ("Rent Adjustment Period"), or
2.2 The percentage of increase of the Price Index between the
Rent Adjustment Date and the later of (i) the Commencement Date of the
Lease or (ii) the last date on which the amount of the Basic Monthly
Rent was adjusted in accordance with this Schedule ("Rent Adjustment
Period").
3. The percentage of increase, if any, in the Price Index shall be
calculated using the Price Index published for the calendar month
immediately preceding the Rent Adjustment Date, and the Price Index most
recently published for the calendar month immediately preceding the
commencement of the Rent Adjustment Period. In no event, however shall the
Basic Monthly Rent following the adjustment provided for in this Schedule
be less than the Basic Monthly Rent payable during the period immediately
preceding the Rent Adjustment Date. The Basic Monthly Rent as adjusted
shall be the Basic Monthly Rent due under the Lease until the next Rent
Adjustment Date and shall be the basis upon which the next Rent Adjustment
shall be made.
4. Billing for Rent Adjustments. Any delay or failure of Landlord,
beyond the Rent Adjustment Date, in computing or billing for the Rent
Adjustment herein above provided, shall not constitute a waiver of or in
any way impair the Tenant's obligation to pay such Rent Adjustment
hereunder. In the event of any such delay or failure of Landlord to notify
Tenant of the Rent Adjustment Tenant shall continue to pay an amount equal
to the Basic Monthly Rent payable for the last month before the latest Rent
Adjustment Date until the adjusted Basic Monthly Rent is determined at
which time Tenant shall pay to Landlord the difference, if any, between the
Basic Monthly Rent paid by Tenant and the adjusted Basic Monthly Rent
determined to be payable after the Rent Adjustment Date.
AMENDMENT TO THE VIRTUAL NEWCO, INC LEASE
Add the following to Section 4 of the lease:
4.2.3 As used herein, the term "Pro Rata Share" means:
1. as to nonrecurring expenses which have a useful life in excess of the then
remaining Term; the Proportionate Share multiplied by a fraction in which the
numerator is the number of months (or partial months) in the then remaining Term
as numerator and the number of months the useful life of the nonrecurring
expense, as reasonably determined by the Landlord and Tenant, as the
denominator. If Landlord and Tenant do not agree on the useful life of any
nonrecurring expense, the matter shall be submitted to binding arbitration, the
cost of said arbitration to be shared equally between Landlord and Tenant.