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Exhibit 10.21
▇▇▇▇▇▇ ROAD
1. BASIC LEASE TERMS
a. DATE OF LEASE EXECUTION: NOVEMBER 29, 2000
b. TENANT: INVIVO CORPORATION, A DELAWARE CORPORATION
TRADE NAME:
ADDRESS (LEASED PREMISES): ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
ADDRESS (FOR NOTICES): SAME
c. LANDLORD: ARCADIA MANAGEMENT SERVICES, INC., AGENT
FOR OWNER
ADDRESS (FOR NOTICES): ARCADIA MANAGEMENT SERVICES - OSGOOD
▇.▇. ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
OR TO SUCH OTHER PLACE AS LANDLORD MAY FROM TIME TO TIME DESIGNATE BY
NOTICE TO TENANT.
d. TENANT'S USE OF PREMISES: OFFICE, LIGHT MANUFACTURING, WAREHOUSE
e. PREMISES AREA: (EXHIBIT A) 7,856 RENTABLE Square Feet
f. PROJECT AREA: (EXHIBIT B) 30,361 RENTABLE Square Feet
g. TENANT'S PERCENTAGE: 26%
h. TERM OF LEASE: Commencement 1/1/2000 Expiration 12/31/2005
Number of Months 60
i. BASE MONTHLY RENT: $10,605.00
j. RENT ADJUSTMENT (INITIAL ONE):
| (1) Cost of Living. If this provision is initialed, the cost of
living provisions of section 4.b(1) apply.
| (2) Step Increase. If this provision is initialed, the step
adjustment provisions of Section 4.b(2) apply as follows:
Effective Date of Rent Increase New Base Monthly Rent
1/1/2002 $11,030.00
1/1/2003 $11,471.00
1/1/2004 $11,930.00
1/1/2005 $12,407.00
k. TOTAL SECURITY DEPOSIT: $ 24,814.00 plus a $ 500.00 -
non-refundable cleaning fee.
l. BROKER(S): J. BLACK & ▇. ▇▇▇▇▇▇: ▇▇▇▇▇ & ▇▇▇▇▇/ ▇. ▇▇▇, ▇. ▇▇▇▇:
CORNISH & ▇▇▇▇▇
▇. GUARANTORS:
n. ADDITIONAL SECTIONS:
Additional sections of this lease numbered 29 through 29, are attached
hereto and made a part hereof. If none, so state in the following space - - - -.
O. ADDITIONAL EXHIBITS:
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Additional exhibits lettered A through C are attached hereto and made a
part hereof. If none, so state in the following space .
P. TENANT PARKING ALLOCATION: Up to twenty seven (27) spaces.
2. PREMISES: Landlord leases to Tenant the premises described in Section 1 and
in Exhibit A (the "Premises"), located in this project described on Exhibit B
(the "Project"). Landlord reserves the right to modify Tenant's Percentage of
the Project as set forth in Section 1 if the Project size is increased through
the development of additional property. By entry on the Premises, Tenant
acknowledges that it has examined the Premises and accepts the Premises in their
present condition, subject to any additional work Landlord has agreed to do.
3. TERM: The term of this Lease is for the period set forth in Section 1,
commencing on the date in Section 1. If Landlord, for any reason, cannot deliver
possession of the Premises to Tenant upon commencement of the term, this Lease
shall not be void or voidable, nor shall Landlord be liable to Tenant for any
loss or damage resulting from such delay. In that event, however, there shall be
a rent abatement covering the period between the commencement of the term and
the time when Landlord delivers possession to Tenant, and all other terms and
conditions of the Lease shall remain in full force and effect, provided,
however, that if Landlord cannot deliver possession of the Premises to Tenant,
this Lease shall be void. If a delay in possession is caused by Tenant's failure
to perform any obligation in accordance with this Lease, the term shall commence
as set forth in Section 1 and there shall be no reduction of rent between the
commencement of the term and the time Tenant takes possession.
4. RENT:
a. BASE RENT. Tenant shall pay Landlord monthly base rent in the initial
amount in Section 1 which shall be payable monthly in advance on the
first day of each and every calendar month ("Base Monthly Rent")
provided, however, the first month's rent is due and payable upon
execution of this Lease. If the term of this Lease contains any rental
abatement period Tenant hereby agrees that if Tenant breaches the Lease
and/or abandons the Premises before the end of the Lease term, or if
Tenant's right to possession is terminated by Landlord because of
Tenant's breach of the Lease, Landlord shall, at its option (1)void the
rental abatement period; and (2) recover from Tenant, in addition to any
damages due Landlord under the terms and conditions of the Lease, rent
prorated for the duration of the rental abatement period at a rental
rate equivalent to two (2) times the Base Monthly Rent.
b. RENT ADJUSTMENT.
1) COST OF LIVING ADJUSTMENT. If Section 1.j.(1) is initialed, the Base
Monthly Rent shall be subject to increase on each annual anniversary of
the commencement of the term of this Lease. The base for computing the
increase is the Consumer Price Index All Urban Consumers for the ▇▇▇
▇▇▇▇▇▇▇▇▇-▇▇▇▇▇▇▇-▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ (▇▇▇▇-▇▇ = 100), published
by the United States Department of Labor, Bureau of Labor Statistics
("Index"), which is in effect on the ninetieth (90th) day preceding the
date of the commencement of the term or the month nearest thereto
("Beginning Index"). The Index published and in effect on the ninetieth
(90th) day preceding each anniversary of the commencement of the term of
this Lease or the month nearest thereto ("Extension Index") is to be
used in determining the amount of the increase from one year to the
next. Beginning with the rent due on and after the first anniversary of
the commencement of the term of this
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Lease, and on and after each subsequent anniversary, the Base Monthly
Rent shall be increased to equal the product achieved by multiplying
the initial full Base Monthly Rent due with respect to the month
immediately preceding such anniversary date by a fraction. On the
first anniversary of the Commencement Date, the numerator of the
fraction will be the Extension Index and the denominator will be the
Beginning Index. On the second and any subsequent anniversaries of the
Commencement Date, the numerator of the fraction will be the current
Extension Index and the denominator will be the Extension Index used
to calculate the previous year's rental increase. If there is a
decline from one lease year to the next in the Extension Index, the
monthly rent due during the subsequent lease year shall equal the
monthly rent due during the then present lease year. If the Index is
changed so that the base year differs from that in effect when the
term commences, the Index shall be converted in accordance with the
conversion factor published by the United States Department of Labor,
Bureau of Labor Statistics. If the Index is discontinued or revised
during the term, such other government index or computation with which
it is replaced shall be used in order to obtain substantially the same
result as would be obtained if the Index had not been discontinued or
revised.
2) STEP INCREASE. If Section 1.j.(2) is initialed, Base Monthly Rent
shall be increased periodically to the amounts and at the times set
forth in Section 1.j.(2).
c. EXPENSES. The purpose of this Section 4.c is to ensure that Tenant
bears a share of all Expenses related to the use, maintenance,
ownership, repair or replacement, and insurance of the Project.
Accordingly, beginning on the date Tenant takes possession of the
Premises, Tenant shall pay to Landlord Tenant's share of Expenses
related to the Project.
1) EXPENSES DEFINED. The term "Expenses" shall mean all costs and
expenses of the ownership, operation, maintenance, repair or
replacement, and insurance of the Project, including without
limitation, the following costs: (a) All supplies, materials, labor,
equipment, and utilities used in or related to the operation and
maintenance of the Project; (b) All maintenance, management,
janitorial, legal, accounting, insurance, and service agreement costs
related to the Project. (c) All maintenance, replacement and repair
costs relating to the areas within or around the Project, including,
without limitation, air conditioning systems, sidewalks, landscaping,
service areas, driveways, parking areas (including resurfacing and
restriping parking areas), walkways, building exteriors (including
painting), signs and directories, repairing and replacing roofs,
walls, etc. These costs may be included either based on actual
expenditures or the use of an accounting reserve based on past cost
experience for the Project. (d) Amortization (along with any
reasonable financing charges) of capital improvements made to the
Project which may be required by any government authority or which
will improve the operating efficiency of the Project (provided,
however, that the amount of such amortization for improvements not
mandated by government authority shall not exceed in any year the
amount of cost reasonably determined by Landlord in its sole
discretion to have been saved by the expenditure either through the
reduction or minimization of increases which would have otherwise
occurred). (e) Real Property Taxes including all taxes, assessments
(general and special) and other impositions or charges which may be
taxed, charged,
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levied, assessed or imposed upon all or any portion of or in relation
to the Project or any portion thereof, any leasehold estate in the
Premises or measured by rent from the Premises, including any increase
caused by the transfer, sale or encumbrance of the Project or any
portion thereof. "Real Property Taxes" shall also include any form of
assessment, levy, penalty, charge or tax (other than estate,
inheritance, net income or franchise taxes) imposed by any authority
having a direct or indirect power to tax or charge, including, without
limitation, any city, county, state, federal or any improvement or
other district, whether such tax is (1) determined by the area of the
Project or the rent or other sums payable under this Lease; (2) upon
or with respect to any legal or equitable interest of Landlord in the
Project or any part thereof; (3) upon this transaction or any document
to which Tenant is a party creating a transfer in any interest in the
Project; (4) in lieu of or as a direct substitute in whole or in part
of or in addition to any real property taxes on the Project; (5) based
on any parking spaces or parking facilities provided in the Project;
or (6) in consideration for services, such as police protection, fire
protection, street, sidewalk and roadway maintenance, refuse removal
or other services that may be provided without charge or with less
charge to property owners or occupants.
2) ANNUAL ESTIMATE OF EXPENSES. When Tenant takes possession of the
Premises, Landlord shall estimate Tenant's share of Expenses for the
remainder of the calendar year based on Tenant's Percentage of the
Project Area set forth in Section 1. At the commencement of each
calendar year thereafter, Landlord shall estimate Tenant's share of
Expenses for the coming year based on Tenant's Percentage of the
Project Area set forth in Section 1.
3) MONTHLY PAYMENT OF EXPENSES. Tenant shall pay to Landlord, as
additional rent, Tenant's Percentage of THE estimated Expenses in
monthly installments of one twelfth (1/12) beginning on the
commencement of the term and 1/12/ on the first day of each succeeding
calendar month. As soon as practical following each calendar year,
Landlord shall prepare an accounting of actual Expenses incurred
during the prior calendar year and such accounting shall reflect
Tenant's share of Expenses. If the additional rent paid by Tenant
under this Section 4.c.3 during the preceding calendar year was less
than the actual amount of Tenant's share of Expenses, Landlord shall
so notify Tenant and Tenant shall pay such amount to Landlord within
30 days of receipt of such notice. Such amount shall be deemed to have
accrued during the prior calendar year and shall be due and payable
from Tenant even though the term of this Lease has expired or this
Lease has been terminated prior to Tenant's receipt of this notice.
Tenant shall have thirty (30) days from receipt of such notice to
contest the amount due; failure to so notify Landlord shall represent
final determination of Tenant's share of expenses. If Tenant's
payments were greater than the actual amount, then such overpayment
shall be credited by Landlord to all present rent due under this
Section 4.c.3.
4) RENT WITHOUT OFFSET AND LATE CHARGE. All rent shall be paid by
Tenant to Landlord monthly in advance on the first day of every
calendar month, at the address shown in Section 1, or such other place
as Landlord may designate in writing from time to time. All rent shall
be paid without prior demand or notice and without any deduction or
offset whatsoever. All rent shall be paid in lawful currency of the
United States of America. All rent due for any partial month shall be
prorated at the rate of 1/30th of the total monthly rent per day.
Tenant acknowledges that late payment by Tenant to Landlord of any
rent or other sums due under this Lease will cause Landlord to incur
costs not contemplated by this Lease, the exact amount of such costs
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being extremely difficult and impracticable to ascertain. Such costs
include, without limitation, processing and accounting charges and
late charges that may be imposed on landlord by the terms of any
encumbrance or note secured by the Premises. Therefore, if any rent or
other sum due from Tenant is not received when due, Tenant shall pay
to Landlord an additional sum equal to 10% of such overdue payment.
Landlord and Tenant hereby agree that such late charge represents a
fair and reasonable estimate of the costs that Landlord will incur by
reason of any such late payment and that the late charge is in
addition to any and all remedies available to the Landlord and that
the assessment and/or collection of the late charge shall not be
deemed a waiver of any other default. Additionally, all such
delinquent rent or other sums, plus this late charge, shall bear
interest at the then maximum lawful rate permitted to be charged by
Landlord. Any payments of any kind returned for insufficient funds
will be subject to an additional handling charge of $35.00, and
thereafter, Landlord may require Tenant to pay all future payments of
rent or other sum due by money order or cashier's check.
5. DEPOSIT. Upon execution of this Lease, Tenant shall deposit the security
deposit set forth in Section 1 with Landlord, as security for the performance by
Tenant of the provisions of this Lease. If Tenant is in default, Landlord can
use the security deposit or any portion of it to cure the default or to
compensate Landlord for any reasonable damages sustained by Landlord resulting
from Tenant's default. Upon written demand, Tenant shall immediately pay to
Landlord a sum equal to the portion of the security deposit expended or applied
by Landlord to maintain the security deposit in the amount initially deposited
with Landlord. In no event will Tenant have the right to apply any part of the
security deposit to any rent or other sums due under this Lease. If Tenant is
not in default at the expiration or termination of this Lease, Landlord shall
return the entire security deposit to Tenant within 30 days after expiration or
termination. Landlord's obligations with respect to the deposit are those of a
debtor and not of a trustee, and Landlord can commingle the security deposit
with Landlord's general funds. Landlord shall not be required to pay Tenant
interest on the deposit. Landlord shall be entitled to immediately endorse and
cash Tenant's prepaid deposit; however, such endorsement and cashing shall not
constitute Landlord's acceptance of this Lease. In the event Landlord does not
accept this Lease, Landlord shall return said prepaid deposit. Landlord shall
provide Tenant with a written accounting of all charges, fees or other means by
which Landlord reduces the amount of Tenant's Security Deposit.
6. USE OF PREMISES AND PROJECT FACILITIES. Tenant shall use the Premises solely
for the purposes set forth in Section 1 and for no other purpose without
obtaining the prior written consent of Landlord. Tenant acknowledges that
neither Landlord nor any agent of Landlord has made any representation or
warranty with respect to the Premises or with respect to the suitability of the
Premises or the Project for the conduct of Tenant's business, nor has Landlord
agreed to undertake any modification, alteration or improvement to the Premises
or the Project, except as provided in writing in this Lease. Tenant acknowledges
that Landlord may from time to time, at its sole discretion, make such
modifications, alterations, deletions or improvements to the Project as Landlord
may deem necessary or desirable. Landlord shall provide prior written notice to
Tenant of any undertaking that may affect Tenant's use of the Premises or the
Project. Tenant reserves the right to seek compensation for Landlord's
undertaking that significantly interfere with Tenant's right to quiet enjoyment.
Tenant shall promptly comply with all laws, ordinances, orders and regulations
affecting the Premises and the Project, including without limitation, any rules
and regulations that may be attached to this Lease and to any reasonable
modifications to these rules and regulations as Landlord may
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adopt from time to time. The foregoing shall not, however, require Tenant to
make any structural changes or improvements to the Premises except to the extent
such structural changes or improvements are required as a result of Tenant's use
of the Premises or any other alterations to the Premises made by or for Tenant.
Tenant shall not do or permit anything to be done in or about the Premises or
bring or keep anything in the Premises that will in any way increase the
premiums paid by Landlord on its insurance related to the Project or which will
in any way increase the premiums for fire or casualty insurance carried by other
tenants in the Project. Tenant will not perform any act or carry on any
practices that may injure the Premises or the Project; that may be a nuisance or
menace to other tenants in the Project; or that shall in any way interfere with
the quiet enjoyment of such other tenants. Tenant shall not use the Premises for
sleeping, washing clothes, cooking or the preparation, manufacture or mixing of
anything that might emit any objectionable odor, noises, vibrations or lights
onto such other tenants. If sound insulation is required to muffle noise
produced by Tenant on the Premises, Tenant at its own cost shall provide all
necessary insulation. Tenant shall not do anything on the Premises which will
overload any existing parking or service to the Premises. Pets and/or animals of
any type shall not be kept on the Premises.
7. SIGNAGE. All signing shall comply with rules and regulations set forth by
Landlord as may be modified from time to time. Tenant shall obtain Landlord's
prior written consent for all signage. Tenant shall place no window covering
(e.g., shades, blinds, curtains, drapes, screens, or tinting materials),
stickers, signs, lettering, banners or advertising or display material on or
near exterior windows or doors if such materials are visible from the exterior
of the Premises, without Landlord's prior written consent. Similarly, Tenant may
not install any alarm boxes, foil protection tape or other security equipment on
the Premises without Landlord's prior written consent. Any material violating
this provision may be destroyed by Landlord without compensation to Tenant.
8. PERSONAL PROPERTY TAXES. Tenant shall pay before delinquency all taxes,
assessments, license fees and public charges levied, assessed or imposed upon
its business operations as well as upon all trade fixtures, leasehold
improvements, merchandise and other personal property in or about the Premises.
9. PARKING. Landlord grants to Tenant and Tenant's customers, suppliers,
employees and invitees, a non-exclusive license to use Tenant's pro rata share
of the designated parking areas in the Project for the use of motor vehicles
during the term of this Lease. Landlord reserves the right at any time to grant
similar non-exclusive use to other tenants, to promulgate rules and regulations
relating to the use of such parking areas, including reasonable restrictions on
parking by tenants and employees, to designate specific spaces for the use of
any tenant, to make changes in the parking layout from time to time, and to
establish reasonable time limits on parking. Overnight parking is prohibited by
any vehicle violating this or any other vehicle regulation adopted by Landlord
is subject to removal at the owner's expense.
10. UTILITIES. Tenant shall pay for all water, gas, heat, light, power, sewer,
electricity, telephone, or other service metered, chargeable or provided to the
Premises. All utilities, other than water, are separately metered to the
Premises and Tenant shall pay all charges for such utilities directly to the
provider thereof. Charges for water shall be included in Operating Expenses and
paid by Tenant as provided in Section 4.c.3. If Tenant's water usage exceeds
Tenant's Percentage, then Landlord shall have the right to install a separate
meter to measure Tenant's water usage and to charge Tenant for the cost of such
installation. Landlord shall not be
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liable in damages or otherwise for any failure or interruption of any utility
service or other service furnished to the Premises, including any data or
telecommunications services.
11. MAINTENANCE. Landlord shall maintain, in good condition, the structural
parts of the Premises, which shall include only the foundations, bearing and
exterior walls (excluding glass), subflooring and roof (excluding skylights),
the unexposed electrical, plumbing and sewerage systems, including without
limitation, those portions of the systems lying outside the Premises, exterior
doors (excluding glass), window frames, gutters and downspouts on the Building
and the heating, ventilating and air conditioning system servicing the Premises;
provided, however, the cost of all such maintenance shall be considered
"Expenses" for purposes of Section 4.c. Except as provided above, Tenant shall
maintain and repair the Premises in good condition, including, without
limitation, maintaining and repairing all walls, floors, ceilings, interior
doors, exterior and interior windows, fixtures, and all data and
telecommunications wiring or cabling, as well as damage caused by Tenant, its
agents, employees or invitees. Upon expiration or termination of this Lease,
Tenant shall surrender the Premises to Landlord in the same condition as existed
at the commencement of the term, except for reasonable wear and tear or damage
caused by fire or other casualty for which Landlord has received all funds
necessary for restoration of the Premises from insurance proceeds.
12. ALTERATIONS. Tenant shall not make any alterations to the Premises, or to
the Project, including any changes to the existing landscaping, without
Landlord's prior written consent. If Landlord gives its consent to such
alterations, Landlord may post notices in accordance with the laws of the state
in which the premises are located. Any alterations made shall remain on and be
surrendered with the Premises upon expiration or termination of this Lease,
except that Landlord may, within 30 days before or 30 days after expiration of
the term, elect to require Tenant to remove any alterations which Tenant may
have made to the Premises. If Landlord so elects, at its own cost Tenant shall
restore the Premises to the condition designated by Landlord in its election,
before the last day of the term or within 30 days after notice of its election
is given, whichever is later.
Should Landlord consent in writing to Tenant's alteration of the Premises,
Tenant shall contract with a contractor approved by Landlord for the
construction of such alterations, shall secure all appropriate governmental
approvals and permits and shall complete such alterations with due diligence in
compliance with plans and specifications approved by Landlord. All such
construction shall be performed in a manner which will not interfere with the
quiet enjoyment of other tenants of the Project. Tenant shall pay all costs for
such construction and shall keep the Premises and the Project free and clear of
all mechanics' liens which may result from construction by Tenant.
13. RELEASE AND INDEMNITY. Tenant agrees that Landlord shall not be liable to
Tenant for any damage to Tenant or Tenant's property arising from Tenant's
negligent misuse of the Premises, and Tenant waives all claims against Landlord
for damage to persons or property arising therefrom, except for damage resulting
directly from Landlord's breach of its express obligations under this lease
and/or California law, which Landlord has not cured within a reasonable time
after receipt of written notice of such breach from Tenant. Tenant shall
indemnify and hold Landlord harmless from all damages for any injury or damage
to any person or property occurring in the Premises and arising out of Tenant's
negligent misuse of the Premises or Tenant's breach of any material term of this
Lease.
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14. INSURANCE. Tenant, at its cost, shall maintain commercial general liability
insurance and product liability insurance with a single combined liability limit
of $1,000,000, insuring against all liability of Tenant and its authorized
representatives arising out of or in connection with Tenant's use or occupancy
of the Premises. Public liability insurance, product liability insurance and
property damage insurance shall insure performance by Tenant of the indemnity
provisions of Section 13. Landlord shall be named as additional insured and the
policy shall contain cross-liability endorsements. At its cost, Tenant shall
maintain a policy of insurance with "all risk" insurance coverage on all its
personal property and all Tenant's improvements and alterations in or about the
Premises, to the extent of at least 90% of their full replacement value. The
proceeds from any such policy shall be used by Tenant for the replacement of
personal property and the restoration of Tenant's improvements or alterations
All insurance required to be provided by Tenant under this Lease shall release
Landlord from any claims for damage to any person or the Premises and the
Project, and to Tenant's fixtures personal property, improvements and
alterations in or on the Premises or the Project, caused by or resulting from
risks insured against under any insurance policy carried by Tenant and in force
at the time of such damage. All insurance required to be provided by Tenant
under this Lease: (a) shall be issued by insurance companies authorized to do
business in the state in which the premises are located with a financial rating
of at least an A-XII status as rated in the most recent edition of Best's
Insurance Reports; (b) shall be issued as a primary policy; and (c) shall
contain an endorsement requiring at least 30 days prior written notice of
cancellation to Landlord and Landlord's lender, before cancellation or change in
coverage, scope or amount of any policy. Tenant shall deliver a certificate or
copy of such policy together with evidence of payment of all current premiums to
Landlord within 30 days of execution of this Lease. Tenant's failure to provide
evidence of such coverage to Landlord may, in Landlord's sole discretion,
constitute a default under this lease.
15. DESTRUCTION. If during the term, the Premises or Project are more than 10%
destroyed from any cause, or rendered inaccessible or unusable from any cause,
Landlord may, in its sole discretion, terminate this Lease by delivery of notice
to Tenant within 30 days of such event without compensation to Tenant. If in
Landlord's estimation, the Premises cannot be restored within 90 days following
such destruction, the Landlord shall immediately notify Tenant and Tenant may
terminate this Lease by delivery of notice to Landlord within 30 days receipt of
Landlord's notice. If Landlord does not terminate this lease and if in
Landlord's estimation Premises can be restored within 90 days, then Landlord
shall commence to restore the Premises in compliance with then existing laws and
shall complete such restoration with due diligence. In such event, this Lease
shall remain in full force and effect, but there shall be an abatement of rent
between the date of destruction and the date of completion of restoration, based
on the extent to which destruction interferes with Tenant's use of the Premises.
16. CONDEMNATION.
a. DEFINITIONS. The following definitions shall apply. (1) "Condemnation"
means (a) the exercise of any governmental power of eminent domain,
whether by legal proceedings or otherwise by condemnor and (b) the
voluntary sale or transfer by Landlord to any condemnor either under
threat of condemnation or while legal proceedings for condemnation are
proceeding; (2) "Date of Taking" means the date the condemnor has the
right to possession of the property being condemned; (3) "Award" means
all compensation, sums or anything of value awarded, paid or received on
a total or partial
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condemnation, and (4) "Condemnor" means any public or quasi-public
authority, or private corporation or individual, having a power of
condemnation.
b. OBLIGATIONS TO BE GOVERNED BY LEASE. If during the term of the Lease
there is any taking of all or any part of the Premises or the Project,
the rights and obligations of the parties shall be determined pursuant
to this Lease.
c. TOTAL OR PARTIAL TAKING. If the Premises are totally taken by
condemnation, this Lease shall terminate on the date of taking. If any
portion of the Premises is taken by condemnation, this Lease shall
remain in effect, except that Tenant can elect to terminate this Lease
if the remaining portion of the Premises is rendered unsuitable for
Tenant's continued use of the Premises. If Tenant elects to terminate
this Lease, Tenant must exercise its right to terminate by giving notice
to Landlord within 30 days after the nature and extent of the taking
have been finally determined. If Tenant elects to terminate this Lease,
Tenant shall also notify Landlord of the date of termination, which date
shall not be earlier than 30 days nor later than 90 days after Tenant
has notified Landlord of its election to terminate; except that this
Lease shall terminate on the date of taking if the date of taking falls
on a date before the date of termination as designated by Tenant. If any
portion of the Premises is taken by condemnation and this Lease remains
in full force and effect, on the date of taking the rent shall be
reduced by an amount in the same ratio as the total number of square
feet in the Premises taken bears to the total number of square feet in
the Premises immediately before the date of taking.
17. ASSIGNMENT OR SUBLEASE. Tenant shall not assign or encumber its interest in
the Lease or the Premises or sublease all or any part of the Premises or allow
any other person or entity (except Tenant's authorized representatives,
employees, invitees, or guests) to occupy or use all or any part of the Premises
without first obtaining Landlord's consent which Landlord shall not unreasonably
withhold. Any assignment, encumbrance or sublease without Landlord's written
consent shall be voidable and at Landlord's election, shall constitute a
default. If Tenant is a partnership, a withdrawal or change, voluntary,
involuntary or by operation of law of any partner, or the dissolution of the
partnership, shall be deemed a voluntary assignment. If Tenant consists of more
than one person, a purported assignment, voluntary or involuntary or by
operation of law from one person to the other shall be deemed a voluntary
assignment. If Tenant is a corporation, any dissolution, merger, consolidation
or other reorganization of Tenant, or sale or other transfer of a controlling
percentage of the capital stock of Tenant, or the sale of at least 25% of the
value of the assets of Tenant shall be deemed a voluntary assignment. The phrase
"controlling percentage" means ownership of and right to vote stock possessing
at least 25% of the total combined voting power of all classes of Tenant's
capital stock issued, outstanding and entitled to vote for election of
directors. This Section 17 shall not apply to corporations the stock of which is
traded through an exchange or over the counter. All rent received by Tenant from
its subtenants in excess of the rent payable by Tenant to Landlord under this
Lease shall be paid to Landlord, or any sums to be paid by an assignee to Tenant
in consideration of the assignment of this Lease shall be paid to Landlord. If
Tenant requests Landlord to consent to a proposed assignment or subletting,
Tenant shall pay to Landlord, whether or not consent is ultimately given, $100
or Landlord's reasonable attorneys' fees incurred in connection with such
request, whichever is greater.
10
No interest of Tenant in this Lease shall be assignable by involuntary
assignment through operation of law (including without limitation the transfer
of this Lease by testacy or intestacy). Each of the following acts shall be
considered an involuntary assignment: (a) If Tenant is or becomes bankrupt or
insolvent, makes an assignment for the benefit of creditors, or institutes
proceedings under the Bankruptcy Act in which Tenant is the bankrupt; or it
Tenant is a partnership or consists of more than one person or entity, if any
partner of the partnership or other person or entity is or becomes bankrupt or
insolvent, or makes an assignment for the benefit of creditors; or (b) If a writ
of attachment or execution is levied on this Lease, of (c) If in any proceeding
or action to which Tenant is a party, a receiver is appointed with authority to
take possession of the Premises. An involuntary assignment shall constitute a
default by Tenant and Landlord shall have the right to elect to terminate this
Lease, in which case this Lease shall not be treated as an asset of Tenant.
18. DEFAULT. The occurrence of any of the following shall constitute a default
by Tenant. (a) A failure to pay rent or other charge when due; (b) Abandonment
and vacation of the Premises (failure to occupy and operate the Premises for ten
consecutive days shall be deemed an abandonment and vacation); or (c) Failure to
perform any other provision of this Lease.
19. LANDLORD'S REMEDIES. Landlord shall have the following remedies if Tenant is
in default. (These remedies are not exclusive; they are cumulative and in
addition to any remedies now or later allowed by law): Landlord may terminate
Tenant's right to possession of the Premises at any time. No act by Landlord
other than giving notice to Tenant shall terminate this Lease. Acts of
maintenance, efforts to relet the Premises, or the appointment of a receiver on
Landlord's initiative to protect Landlord's interest under this Lease shall not
constitute a termination of Tenant's right to possession. Upon termination of
Tenant's right to possession, Landlord has the right to recover from Tenant: (1)
The worth at the time of award of any unpaid rent that had been earned at the
time of termination of Tenant's right to possession; (2) The worth at the time
of award of the amount by which the unpaid rent that would have been earned
after the date of termination of Tenant's right to possession until the time of
award exceeds the amount of such rental loss that Tenant proves could have been
reasonably avoided; (3) the worth at the time of award of the amount by which
the unpaid rent for the balance of the term after the time of award exceeds the
amount of such rental loss that Tenant proves could be reasonably avoided; and
(4) Any other reasonable amount, including court, attorney and collection costs,
necessary to compensate Landlord for all detriment proximately caused by
Tenant's default. The "worth" as used for Item 19(1) in this Paragraph 19 is to
be computed by allowing interest at the maximum rate an individual is permitted
to charge by law or 12%, whichever is less. "The worth at the time of the award"
as used for Item 19(2) in this Paragraph 19 is to be computed by discounting the
amount at the discount rate of the Federal Reserve Bank of San Francisco at the
time of termination of Tenant's right of possession. In the event of any default
by Tenant, Landlord shall have the right to apply any sums paid by Tenant to any
rent, late charge or other amount then due under this Lease, in such order as
Landlord shall elect in Landlord's sole discretion.
20. ENTRY ON PREMISES. Landlord and its authorized representatives shall have
the right to enter the Premises at all reasonable times for any of the following
purposes: (a) To determine whether the Premises are in good condition and
whether Tenant is complying with its obligations under this Lease; (b) To do any
necessary maintenance and to make any restoration to the Premises or the Project
that Landlord has the right or obligation to perform; (c) To post "for sale"
signs at any time during the term, to post
11
"for rent" or "for lease" signs during the last 90 days of the term, or during
any period while Tenant is in default; (d) To show the Premises to prospective
brokers, agents, buyers, tenants or persons interested in leasing or purchasing
the Premises, at any time during the term; or (e) To repair, maintain or improve
the Project and to erect scaffolding and protective barricades around and about
the Premises but not so as to prevent entry to the Premises and to do any other
act or thing necessary for the safety or preservation of the Premises or the
Project. Landlord shall not be liable in any manner for any inconvenience,
disturbance, loss of business, nuisance or other damage arising out of
Landlord's entry onto the Premises as provided in this Section 20. Tenant shall
not be entitled to an abatement or reduction of rent if Landlord exercises any
rights reserved in this Section 20. Landlord shall conduct his activities on the
Premises as provided herein in a manner that will cause the least inconvenience,
annoyance or disturbance to Tenant. For each of these purposes, Landlord shall
at all times have and retain a key with which to unlock all the doors in, upon
and about the Premises, excluding Tenant's vaults and safes. Tenant shall not
alter any lock or install a new or additional lock or bolt on any door of the
Premises without prior written consent of Landlord. If Landlord gives its
consent, Tenant shall furnish Landlord with a key for any such lock.
21. SUBORDINATION. Without the necessity of any additional document being
executed by Tenant for the purpose of effecting a subordination, and at the
election of Landlord or any mortgagee or any beneficiary of a Deed of Trust with
a lien on the Project or any ground lessor with respect to the Project, this
Lease shall be subject and subordinate at all times to (a) all ground leases or
underlying leases which may now exist or hereafter be executed affecting the
Project, and (b) the lien of any mortgage or deed of trust which may now exist
or hereafter by executed in any amount for which the Project, ground leases or
underlying leases, or Landlord's interest or estate in any of said items is
specified as security. In the event that any ground lease or underlying lease
terminates for any reason or any mortgage or Deed of Trust is foreclosed or a
conveyance in lieu of foreclosure is made for any reason, Tenant shall,
notwithstanding any subordination, attorn to and become the Tenant of the
successor in interest to Landlord, at the option of such successor in interest.
Tenant covenants and agrees to execute and deliver, upon demand by Landlord and
in the form requested by Landlord, any additional documents evidencing the
priority or subordination of this Lease with respect to any such ground lease or
underlying leases or the lien of any such mortgage or Deed of Trust. Tenant
hereby irrevocably appoints Landlord as attorney-in-fact of Tenant to execute,
deliver and record any such document in the name and on behalf of Tenant.
22. ESTOPPEL CERTIFICATES AND FINANCIAL STATEMENTS.
a. ESTOPPEL CERTIFICATES. Within ten (10) days after written request by
Landlord, Tenant shall execute and deliver to Landlord any documents,
including estoppel certificates, in the form prepared by Landlord (a)
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 (b) acknowledging
that there are not, to Tenant's knowledge, any uncured defaults on the part
of Landlord, or, if there are uncured defaults on the part of the Landlord,
stating the nature of such uncured defaults, and (c) evidencing the status
of the Lease as may be required either by a lender making a loan to Landlord
to be secured by deed of trust or mortgage covering the Project or a
purchaser of the Project from the Landlord. Tenant's failure to deliver an
estoppel certificate within such 10-day period shall
12
be a breach of this Lease and shall be conclusive upon Tenant that this
Lease is in full force and effect, without modification except as may be
represented by Landlord, that there are now no uncured defaults in
Landlord's performance, and that no rent has been paid in advance.
b. FINANCIAL STATEMENTS. Within ten (10) days after written request by
Landlord, Tenant shall deliver to Landlord the current annual report of
Tenant, and annual reports of the two (2) years prior to the current annual
report, with an opinion of a certified public accountant, including a
balance sheet and profit and loss statement for the most recent prior year,
all prepared in accordance with generally accepted accounting principles
consistently applied.
23. NOTICE. Any notice, demand, request, consent, approval or communication
desired by either party or required to be given, shall be in writing and served
either personally or sent by prepaid certified first class mail, addressed as
set forth in Section 1. Either party may change its address by notification to
the other part. Notice shall be deemed to be communicated 48 hours from the time
of mailing, or from the time of service as provided in this Section 23.
24. WAIVER. No delay or omission in the exercise of any right or remedy by
Landlord shall impair such right or remedy or be construed as a waiver. No act
or conduct of Landlord, including without limitation, acceptance of the keys to
the Premises, shall constitute an acceptance of the surrender of the Premises by
Tenant before the expiration of the term. Only written notice from Landlord to
Tenant shall constitute acceptance of the surrender of the Premises and
accomplish termination of the Lease. Landlord's consent to or approval of any
act by Tenant requiring Landlord's consent or approval shall not be deemed to
waive or render unnecessary Landlord's consent to or approval of any subsequent
act by Tenant. Any waiver by Landlord of any default must be in writing and
shall not be a waiver of any other default concerning the same or any other
provision of the Lease.
25. SURRENDER OF PREMISES; HOLDING OVER. Upon expiration of the term, Tenant
shall surrender to Landlord the Premises and all Tenant improvements and
alterations in good condition, except for ordinary wear and tear and alterations
Tenant has the right or is obligated to remove under the provisions of Section
12 herein. Tenant shall remove all personal property including, without
limitation, all wallpaper, paneling and other decorative improvements or
fixtures and shall perform all restoration made necessary by the removal of any
alterations or Tenant's personal property before the expiration of the term,
including for example, restoring all wall surfaces to their condition prior to
the commencement of this Lease. Landlord can elect to retain or dispose of in
any manner Tenant's personal property not removed from the Premises by Tenant
prior to the expiration or sooner termination of this Lease. Tenant waives all
claims against Landlord for any damage to Tenant resulting from Landlord's
retention or disposition of Tenant's personal property. Tenant shall be liable
to Landlord for Landlord's costs for storage, removal or disposal of Tenant's
personal property. If Tenant, with Landlord's consent, remains in possession of
the Premises after expiration or termination of the term, or after the date in
any notice given by Landlord to Tenant terminating this Lease, such possession
by Tenant shall be deemed to be a month-to-month tenancy terminable on written
30-day notice at any time, by either party. All provisions of this Lease, except
those pertaining to term and rent, shall apply to the month-to-month tenancy.
Tenant shall pay
13
monthly rent in an amount equal to 200% of Rent for the last full calendar month
during the regular term plus 100% of said last month's estimate of Tenant's
share of Expenses pursuant to Section 4.c.3.
26. LIMITATION OF LIABILITY. In consideration of the benefits accruing
hereunder, Tenant agrees that, in the event of any actual or alleged failure,
breach or default of this Lease by Landlord, the sole and exclusive remedy shall
be against the right, title and interest of Landlord in the Project and out of
the rent or other income from such property received by Landlord or out of
consideration received by Landlord from the sale or other disposition of all or
any part of Landlord's right, title or interest in the Project, and neither
Landlord nor its agents shall be liable for any deficiency. Tenant agrees that
the foregoing provisions shall be applicable to any covenant or agreement either
expressly contained in this Lease or imposed by statute or at common law.
27. MISCELLANEOUS PROVISIONS
a. TIME OF ESSENCE. Time is of the essence of each provision of this Lease.
b. SUCCESSOR. This Lease shall be binding on and inure to the benefit of the
parties and their successors, except as provided in Section 18 herein.
c. LANDLORD'S CONSENT. Any consent required by Landlord under this Lease
must be granted in writing and may be withheld by Landlord in its sole and
absolute discretion, except as otherwise specifically stated.
d. COMMISSIONS. Each party represents that it has no had dealings with any
real estate broker, finder or other person with respect to this Lease in any
manner, except for the broker identified in Section 1, who shall be
compensated by Landlord.
e. OTHER CHARGES. If Landlord becomes a party to any litigation concerning
this Lease, the Premises or the Project, by reason of any act or omission of
Tenant or Tenant's authorized representatives, Tenant shall be liable to
Landlord for reasonable attorneys' fees and court costs incurred by Landlord
in the litigation whether or not such litigation leads to actual court
action. Should the court render a decision which is thereafter appealed by
any party thereto, Tenant shall be liable to Landlord for reasonable
attorneys' fees and courts cost incurred by Landlord in connection with such
appeal.
If either party commences any litigation against the other party or
files an appeal of a decision arising out of or in connection with this
Lease, the prevailing party shall be entitled to recover from the other
party reasonable attorneys' fees and costs of suit. If Landlord employs a
collection agency to recover delinquent charges, Tenant agrees to pay all
collection agency and attorney's fees charged to Landlord in addition to
rent, late charges, interest and other sums payable under this Lease. Tenant
shall pay a charge of $75 to Landlord for preparation of a demand for
delinquent rent.
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f. LANDLORD'S SUCCESSORS. In the event of a sale or conveyance by Landlord
of the Project, the same shall operate to release Landlord from any
liability under this Lease, and in such event Landlord's successor in
interest shall be solely responsible for all obligations of Landlord under
this lease.
g. INTERPRETATION. This Lease shall be construed and interpreted in
accordance with the laws of the state in which the premises are located.
This Lease constitutes the entire agreement between the parties with
respect to the Premises and the Project, except for such guarantees or
modifications as may be executed in writing by the parties from time to
time. When required by the context of this Lease, the singular shall
include the plural, and the masculine shall include the feminine and/or
neuter. "Party" shall mean Landlord or Tenant. If more than one person o
entity constitutes Landlord or Tenant, the obligations imposed upon that
party shall be joint and several. The enforceability, invalidity or
illegality of any provision shall not render the other provisions
unenforceable, invalid or illegal.
28. EMISSIONS; STORAGE, USE AND DISPOSAL OF WASTE
1. EMISSIONS. Tenant shall not:
a. Knowingly permit any vehicle on the premises to emit exhaust which
is in violation of any governmental law, rule, regulation or
requirement.
b. Discharge, emit or permit to be discharged or emitted, any liquid,
solid or gaseous matter, or any combination thereof, into the
atmosphere, the ground or any body of water, which matter, as
reasonably determined by Lessor or any governmental entity, does or
may, pollute or contaminate the same, or is, or may become,
radioactive or does, or may, adversely affect the (1) health or safety
of person, wherever located, whether on the premises or anywhere else.
(2) condition, use or enjoyment of the premises or any other real or
personal property, whether on the premises or anywhere else, or (3)
premises or any of the improvements thereto or thereon including
buildings, foundations, pipes, utility lines, landscaping or parking
areas;
c. Produce, or permit to be produced, any intense glare, light or heat
except within an enclosed or screened area and then only in such
manner that the glare, light or heat shall not be discernible from
outside the premises;
d. Create, or permit to be created any sound pressure level which will
interfere with the quiet enjoyment of any real property outside the
premises; or which will create a nuisance or violate any governmental
law, rule, regulation or requirement.
e. Create, or permit to be created, any ground vibration that is
discernible outside the premises.
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f. Transmit, receive or permit to be transmitted or received, any
electromagnetic, microwave or other radiation which is harmful or
hazardous to any person or property in, on or about the premises, or
anywhere else.
2. STORAGE AND USE.
a. STORAGE. Subject to the uses permitted and prohibited to Tenant
under this Lease, Tenant shall store in appropriate leak proof
containers all solid, liquid, or gaseous matter, or any combination
thereof, which matter, if discharged or emitted into the atmosphere,
the ground or any body of water, does or may (1) pollute or
contaminate the same, or (2) adversely affect the (i) health or safety
of persons, whether on the premises or anywhere else, (ii) condition,
use or enjoyment of the premises or any real or personal property,
whether on the premises or anywhere else, of (iii) premises or any of
the improvements thereto or thereon.
b. USE. In addition, without Landlord's prior written consent, Tenant
shall not use, store or permit to remain on the premises any solid,
liquid or gaseous matter which is, or may become, radioactive. If
Landlord does give its consent, Tenant shall store the materials in
such a manner that no radioactivity will be detectable outside a
designated storage area and Tenant shall use the materials in such a
manner that (1) no real or personal property outside the designated
storage area shall become contaminated thereby or (2) there are and
shall be no adverse effects on the (i) health or safety of persons,
whether on the premises or anywhere else, (ii) condition, use or
enjoyment of the premises or any real or personal property, whether on
the premises or anywhere else, of (iii) premises or any of the
improvements thereto or thereon.
3. DISPOSAL OF WASTE.
a. REFUSE DISPOSAL. Tenant shall not keep any trash, garbage, waste or
other refuse on the premises except in sanitary containers and shall
regularly and frequently remove same from the premises. Tenant shall
keep all incinerators, containers or other equipment used for the
storage or disposal of such materials in a clean and sanitary
condition.
b. SEWAGE DISPOSAL. Tenant shall properly dispose of all sanitary
sewage and shall not use the sewage disposal system (1) for the
disposal of anything except sanitary sewage or (2) excess of the
lesser of the amount (a) reasonably contemplated by the uses permitted
under this Lease or (b) permitted by any governmental entity. Tenant
shall keep the sewage disposal system free of all obstructions and in
good operating condition.
c. DISPOSAL OF OTHER WASTE. Tenant shall properly dispose of all other
waste or other matter delivered to, stored upon, located upon or
within, use on, or removed from, the premises in such a manner that it
does not, and will not, adversely affect the (1) health or safety of
persons, wherever located, whether on the premises or elsewhere, (2)
condition, use or enjoyment of the premises or any other real or
personal property, wherever located, whether on the premises or
anywhere
16
else, or (3) premises or any of the improvements thereto or thereon
including buildings, foundations, pipes, utility lines, landscaping or
parking area.
4. COMPLIANCE WITH LAW. Notwithstanding any other provision in the Lease
to the contrary, Tenant shall comply with all laws, statues,
ordinances, regulations, rules and other governmental requirements in
complying with its obligations under this Lease, and in particular,
relating to the storage, use and disposal of hazardous or toxic
matter.
5. INDEMNIFICATION. Tenant shall defend, indemnify and hold Landlord
harmless from any loss, claim liability or expense, including
attorneys' fees and costs, arising out of or in connection with its
failure to observe or comply with the provisions of this Lease.
LANDLORD: ARCADIA MANAGEMENT SERVICES CO. TENANT: INVIVO CORPORATION
AGENT FOR OWNER
BY BY:
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▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, President ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President