AIRPORT II PROPERTY MANAGEMENT, LLC FULL SERVICE LEASE
AIRPORT
II PROPERTY MANAGEMENT, LLC
1.
BASIC LEASE PROVISIONS ("Basic Lease Provisions")
1.1
Parties:
This
Lease, dated for reference purposes only, March
7,
2008, is
made
by and between
Airport II Property Management, LLC (herein
called "Lessor") and Document
Capture Technologies, Inc.
(herein
called "Lessee").
1.2
Premises:
Suite
Number
178, consisting
of approximately
5,493 rentable square feet and 4,479 useable square feet,
more or
less, as defined in paragraph 2 (the "Premises"). A 15% load is included in
the
total approximate square feet.
1.3
Building:
Commonly
described as being located at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ in
the
City of San
▇▇▇▇,
County of Santa ▇▇▇▇▇, and State of California and as defined in paragraph
2.
1.4
Use:
General
office use and related legal uses, subject to paragraph 6.
1.5
Term:
Two (2)
years commencing on July
1, 2008 ("Commencement
Date") and ending June
30, 2010
(“Termination Date”), as defined in paragraph 3.
1.6
Base Rent:
Shall
be payable on the first day of each month in accordance with paragraphs 1.7
and
4.1 herein.
1.7
Base Rent Schedule: 07/01/08
to 06/30/09: $11,535.30 per month ($2.10
per square foot)
07/01/09
to
06/30/10: $12,359.25 per month ($2.25
per square foot)
1.8
Operating Expenses Schedule: 07/01/08
to 06/30/09: $346.05 per month
(3% of
1st
year’s
monthly rent)
07/01/09
to 06/30/10: $370.77 per month
(3% of
2nd
year’s
monthly rent)
1.9
Base Rent and Other Monies Paid Upon Execution:
(a)
Base Rent: $11,535.30
(b)
Operating Expenses: $346.05
(c)
Security Deposit: $0 ($22,432.20
on file)
(d)
Other: $0
(e)
Total due upon Execution of this Lease: $0
1.10
Business Hours for the Building:
7:00
a.m. to 7:00 p.m. Monday through Friday (except Building Holidays).
2.
PREMISES, PARKING AND COMMON AREAS:
2.1
Premises:
The
Premises are a portion of a building, herein sometimes referred to as the
"Building" identified in paragraph 1.3 of the Basic Lease Provisions "Building"
shall include adjacent parking structures used in connection therewith The
Premises, the Building, the Common Areas, the land upon which the same are
located, along with all other buildings and improvements thereon or thereunder,
are herein collectively referred to as the "Office Building Project". Lessor
hereby leases to Lessee and Lessee leases from Lessor for the term, at the
rental rate, and upon all of the conditions set forth herein, the real property
referred to in the Basic Lease Provisions, paragraph 1.2, as the "Premises",
including rights to the Common Areas as hereinafter specified. Lessee agrees
that Lessee has been given a full and fair opportunity to determine and confirm
the square footage of the Premises and further agrees that the square footage
referenced in the Basic Lease Provisions, paragraph 1.2, is conclusively deemed
accurate.
2.2
Vehicle Parking:
So long
as Lessee is not in default, and subject to the rules and regulations attached
hereto, and as established by Lessor from time to time, Lessee shall be entitled
to rent and use n/a
(#)
unreserved parking spaces in the Office Building Project. There shall be no
overnight parking.
(a)
If
Lessee commits, permits or allows any of the prohibited activities described
in
the Lease or the rules then in effect, then Lessor shall have the right, without
notice, in addition to such other rights and remedies that it may have, to
remove or tow away the vehicle involved and charge the cost to Lessee, which
cost shall be immediately payable upon demand by Lessor.
2.3
Common Areas - Definition.
The
term "Common Areas" is defined as all areas and facilities outside the Premises
and within the exterior boundary line of the Office Building Project that are
provided and designated by Lessor from time to time for the general
non-exclusive use of Lessor, Lessee and of other lessees of the Office Building
Project and their respective employees, suppliers, shippers, customers and
invitees, including, but not limited to, common entrances, lobbies, corridors,
stairways and stairwells, public restrooms, elevators, escalators, parking
areas
to the extent not otherwise prohibited by this Lease, loading and unloading
areas, trash areas, roadways, sidewalks, walkways, parkways, ramps, driveways,
landscaped areas and decorative walls, but shall not have any right to the
roof,
the exterior walls, the area above the dropped ceilings, or the utility raceways
of the building containing the Premises or to any other building in the Office
Building Project.
2.4
Common Areas - Rules and Regulations.
Lessee
agrees to abide by and conform to the rules and regulations attached hereto
as
Exhibit 'A' with respect to the Office Building Project and Common Areas, and
to
cause its employees, suppliers, shippers, customers and invitees to so abide
and
conform. Lessor or such other person(s) as Lessor may appoint shall have the
exclusive control and management of the Common Areas and shall have the right
from time to time to modify, amend and enforce said rules and regulations.
Lessor shall not be responsible to Lessee for the non-compliance with said
rules
and regulations by other lessees, their agents, employees and invitees of the
Office Building Project.
2.5
Common Areas - Changes.
Lessor
shall have the right, in Lessor's sole discretion, from time to
time:
(a)
To make
changes to the Building interior and exterior and Common Areas, including,
without limitation, changes in the location, size, shape, number, and appearance
thereof, including but not limited to the lobbies, windows, stairways, air
shafts, elevators, escalators, restrooms, driveways, entrances, parking spaces,
parking areas, loading and unloading areas, ingress, egress, direction of
traffic, decorative walls, landscaped areas and walkways; provided, however,
Lessor shall at all time provide the parking facilities required by applicable
law:
(b)
To close
temporarily any of the Common Areas for maintenance purposes so long a
reasonable access to the Premises remains available;
(c)
To
designate other land and improvements outside the boundaries of the Office
Building Project to be a part of the Common Areas, provided that such other
land
and improvements have a reasonable and functional relationship to the Office
Building Project;
(d)
To add
additional buildings and improvements to the Common Areas:
(e)
To use
the Common Areas while engaged in making additional improvements, repairs or
alterations to the Office Building Project, or any portion thereof:
(f)
To do
and perform such other act and make such other changes in, to or with respect
to
the Common Areas and Office Building Project as Lessor may, in the exercise
of
sound business judgment deem to be appropriate.
Initials
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1
3.
TERM.
3.1
Term.
The
term Commencement Date and Termination Date of this Lease shall be as specified
in paragraph 1.5 of the Basic Lease Provisions.
3.2
Delay in Possession. Notwithstanding
said Commencement Date, if for any reason Lessor cannot deliver possession
of
the Premises to Lessee on said date and subject to paragraph 32(b), Lessor
shall
not be subject to any liability therefor, nor shall such failure affect the
validity of this Lease or the obligations of Lessee hereunder or extend the
term
hereof; but, in such case, Lessee shall not be obligated to pay rent or perform
any other obligation of Lessee under the terms of this Lease, except as may
be
otherwise provided in this Lease, until possession of the Premises is tendered
to Lessee, as hereinafter defined; provided, however, that if Lessor shall
not
have delivered possession of the Premises within sixty (60) days following
said
Commencement Date, as the same may be extended under the terms of a Work Letter
executed by Lessor and Lessee, Lessee may, at Lessee's option by notice in
writing to Lessor, within ten (10) days thereafter, cancel this Lease, in which
event the parties shall be discharged from all obligations hereunder, provided
however that as to Lessee's obligations, Lessee first reimburses Lessor for
all
costs incurred for Non-Standard improvements and as to Lessor's obligations,
Lessor shall return any money previously deposited by Lessee (less any offsets
due Lessor for Non-Standard Improvements); and provided further that if such
written notice by Lessee is not received by Lessor within said ten (10) day
period, Lessee's right to cancel this Lease hereunder shall terminate and be
of
no further force and effect.
(a)
Possession Tendered - Defined.
Possession of the Premises shall be deemed tendered to Lessee ("Tender of
Possession") when (1) the improvements to be provided by Lessor under this
Lease
are substantially completed, (2) the Building utilities are ready for use in
the
Premises, and (3) Lessee has reasonable access to the Premises.
(b)
Delays Caused by Lessee. There
shall be no abatement of rent, and the sixty (60) day period following the
Commencement Date before which Lessee's right to cancel this Lease accrues
under
paragraph 3.2, shall be deemed extended to the extent of any delays caused
by
acts or omissions of Lessee, Lessee's agents, employees and
contractors.
3.3
Early Possession.
If
Lessee occupies the Premises prior to said Commencement Date, such occupancy
shall be subject to all provisions of this Lease, such occupancy shall not
change the termination date, and Lessee shall not pay rent for such early
occupancy.
3.4
Uncertain Commencement.
In the
event commencement of the Lease term is defined as the completion of the
improvements, Lessee and Lessor shall execute an amendment to this Lease
establishing the date of Tender of Possession (as defined in paragraph 3.2(a)
or
the actual taking of possession by Lessee, whichever first occurs, as the
Commencement Date.
3.5
Lessee Compliance.
Lessor
shall not be required to tender possession of the Premises to Lessee until
Lessee complies with its obligation to provide evidence of insurance (Paragraph
8.3). Pending delivery of such evidence, Lessee shall be required to perform
all
of its obligations under this Lease from and after the Commencement Date,
including the payment of Rent, notwithstanding Lessor's election to withhold
possession pending receipt of such evidence of insurance. Further, if Lessee
is
required to perform any other conditions prior to or concurrent with the
Commencement Date, the Commencement Date shall occur but Lessor may elect to
withhold possession until such conditions are satisfied.
4.
RENT.
4.1
Base Rent.
Subject
to adjustment as provided in paragraph 1.7 and except as may be otherwise
expressly provided in this Lease, Lessee shall pay to Lessor the Base Rent
for
the Premises set forth in paragraph 1.7 of the Basic Lease Provisions, without
offset or deduction. Lessee shall pay Lessor upon execution hereof the advance
Base Rent described in paragraph 1.8 of the Basic Lease provisions. Rent for
any
period during the term hereof which is for less than one month shall be prorated
based upon the actual number of days of the calendar month involved. Rent shall
be payable in lawful money of the United States to Lessor at the address stated
herein or to such other persons or at such other places as Lessor may designate
in writing
4.2
Operating Expenses.
Lessee
shall pay to Lessor, in addition to Base Rent, the amount set forth in paragraph
1.9 of the Basic Lease Provisions, as fixed Operating Expenses, without offset
or deduction, and payable on the first day of each month in the manner described
in paragraph 4.1.
5.
SECURITY DEPOSIT.
Lessee
shall deposit with Lessor upon execution hereof the Security Deposit as security
for Lessee's faithful performance of its obligations under this Lease. If Lessee
fails to pay Rent, or otherwise Defaults under this Lease, Lessor may use,
apply
or retain all or any portion of said Security Deposit for the payment of any
amount due Lessor, including late charges, or to reimburse or compensate Lessor
for any liability, expense, loss or damage which Lessor may suffer or incur
by
reason thereof. If Lessor uses or applies all or any portion of said Security
Deposit, Lessee shall within ten (10) days after written request therefor
deposit monies with Lessor sufficient to restore said Security Deposit to the
full amount required by this Lease. If the Base Rent increases during the term
of this Lease, Lessee shall, upon written request from Lessor, deposit
additional monies with Lessor so that the total amount of the Security Deposit
shall at all times bear the same proportion to the increased Base Rent as the
initial Security Deposit bore to the Initial Base Rent. Should the Use
(Paragraph 1.4) be amended to accommodate a material change in the business
of
Lessee or to accommodate a sublessee or assignee, Lessor shall have the right
to
increase the Security Deposit to the extent necessary, in Lessor's reasonable
judgment, to account for any increased wear and tear that the Premises may
suffer as a result thereof. If a change in control of Lessee occurs during
this
Lease and following such change the financial condition of Lessee is, in
Lessor's reasonable judgment, significantly reduced, Lessee shall deposit such
additional monies with Lessor as shall be sufficient to cause the Security
Deposit to be at a commercially reasonable level based on said change in
financial condition. Lessor shall not be required to keep the Security Deposit
separate from its general accounts. Within fourteen (14) days after the
expiration or termination of this Lease, if Lessor elects to apply the Security
Deposit only to unpaid Rent, and otherwise within thirty (30) days after the
Premises have been vacated pursuant to Paragraph 7.2(b) below, Lessor shall
return that portion of the Security Deposit not used or applied by Lessor.
No
part of the Security Deposit shall be considered to be held in trust, to bear
interest or to be prepayment for any monies to be paid by Lessee under this
Lease. It is specifically understood that Lessee shall have no right at any
time
to apply said Security Deposit, or any portion thereof, to any of its Rent
obligations (including its last month’s Rent) or to any other sums due and
payable by Lessee under this Lease.
6.
Use.
6.1
Use.
The
Premises shall be used and occupied only for the Use specified in Paragraph
1.4,
or any other legal use which is reasonably comparable thereto, and for no other
purpose. Lessee shall not use or permit the use of the Premises in a manner
that
is unlawful, creates damage, waste or a nuisance, or that disturbs owners and/or
occupants of, or causes damage to neighboring properties. Lessor shall not
unreasonably withhold or delay its consent to any written request for a
modification of the Use, so long as the same will not impair the structural
integrity of the improvements on the Premises or the mechanical or electrical
systems therein, or is not significantly more burdensome to the Premises. If
lessor elects to withhold consent, Lessor shall within five (5) business days
after such request give written notification of same, which notice shall include
an explanation of Lessor=s
objections to the change in use.
Initials
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6.2
Compliance.
(a)
Lessor
warrants to Lessee that the Premises, in the state existing on the date that
the
Lease term commences, but without regard to alterations or improvements made
by
Lessee or the use for which Lessee will occupy the Premises, do not violate
any
covenants or restrictions of record in effect on such Lease term Commencement
Date. In the event it is determined that this warranty has been violated, then
it shall be the obligation of the Lessor, after written notice from Lessee,
to
promptly, at Lessor's sole cost and expense, rectify any such violation. In
the
event Lessee does not give to Lessor written notice of the violation of this
warranty within six (6) months from the date that the Lease term commences,
the
correction of same shall be the obligation of the Lessee at Lessee's sole cost
The warranty contained in this paragraph 6.2(a) shall be of no force or effect
if, prior to the date of this Lease, Lessee was an owner or occupant of the
Premises and, in such event, Lessee shall correct any such violation at Lessee's
sole cost.
(b)
Except
as provided in paragraph 6.2(a), Lessee shall, at Lessee's expense, promptly
comply with all applicable statutes (including Americans with Disabilities
Act
and O.S.H.A.), ordinances, rules, regulations, orders, covenants and
restrictions of record, and requirements of any fire insurance underwriters
or
rating bureaus, now in effect or which may hereafter come into effect, whether
or not they reflect a change in policy from that now existing, during the term
or any part of the term hereof, relating in any manner to the Premises and
the
occupation and use by Lessee of the Premises. Lessee shall conduct its business
in a lawful manner and shall not use or permit the use of the Premises or the
Common Area in any manner that will tend to create waste or a nuisance or shall
tend to disturb other occupants of the Office Building Project.
6.3
Condition of Premises.
(a)
Lessee
warrants to Lessor that Lessee has conducted a thorough inspection of the
Premises including, without limitation, the plumbing, lighting, air
conditioning, and heating system, and Lessee accepts the Premises in the
condition existing on the Commencement Date.
(b)
Except
as otherwise provided in this Lease, Lessee hereby accepts the Premises and
the
Office Building Project in their condition existing as of the Lease Commencement
Date or the date that Lessee takes possession of the Premises, whichever is
earlier, subject to all applicable zoning, municipal, county and state laws,
ordinances and regulations governing and regulating the use of the Premises,
and
any easements, covenants or restrictions of record, and accepts this Lease
subject thereto and to all matters disclosed thereby and by any exhibits
attached hereto. Lessee acknowledges that it has satisfied itself by its own
independent investigation that the Premises are suitable for its intended use,
and that neither Lessor nor Lessor's agent or agents has made any representation
or warranty as to the present or future suitability of the Premises, Common
Areas or Office Building Project for the conduct of Lessee's
business.
6.4
Waste Nuisance.
Lessee
shall not use the premises in any manner that will constitute waste, nuisance,
or unreasonable annoyance (including, without limitation, unreasonable noise,
the use of loudspeakers or sound or light apparatus that can be heard or seen
outside the Premises) to other tenants in the Building or occupants of
neighboring properties. Lessee shall not use the Premises for vehicle repair,
sleeping, washing clothes, cooking, or the preparation, manufacturing or mixing
of anything that might emit any odor or objectionable noises or lights into
the
Building or onto neighboring properties.
7.
MAINTENANCE, REPAIRS, ALTERATIONS AND COMMON AREA
SERVICES.
7.1
Lessor's Obligations.
Lessor
shall keep the Office Building Project, including the Premises, interior
and
exterior
walls, roof and Common Areas, whether used exclusively for the Premises
or in
common with other Premises, in good condition and repair; provided, however,
Lessor shall not be obligated to paint, repair or replace wall coverings,
or to
repair or replace any improvements that are not ordinarily a part of the
Building. Except as provided in paragraph 9.5, there shall be no abatement
of
rent or liability of Lessee on account of any injury or interference with
Lessee's business with respect to any improvements, alterations or repairs
made
by Lessor to the Office Building Project or any part thereof. Lessee expressly
waives the benefits of any statute now or hereafter in effect which would
otherwise afford Lessee the right to make repairs at Lessor's expense or
to
terminate this Lease because of Lessor's failure to keep the Premises in
good
order, condition and repair.
7.2
Lessee's Obligations.
(a)
Notwithstanding Lessor's obligation to keep the Premises in good condition
and
repair, Lessee shall be responsible for payment of the cost thereof to Lessor
as
additional rent for that portion of the cost of any maintenance and repair
of
the Premises, or any equipment (wherever located) that serves only Lessee or
the
Premises, to the extent such cost is attributable to causes beyond normal wear
and tear. Lessee shall be responsible for the cost of painting, repairing or
replacing wall coverings, and to repair or replace any Premises improvements
that are not ordinarily a part of the Building. Lessor may, at its option,
upon
reasonable notice, perform such maintenance or repair at Lessee’s cost that is
otherwise Lessee's responsibility hereunder.
(b)
On the
last day of the term hereof, or on any sooner termination, Lessee shall
surrender the Premises to Lessor in the same condition as received, ordinary
wear and tear excepted, clean and free of debris. Any damage or deterioration
of
the Premises shall not be deemed ordinary wear and tear if the same could have
been prevented by good maintenance practices by Lessee. Lessee shall repair
all
penetrations and damage (including markings to walls and stains in carpet).
Lessee shall repair any damage to the Premises occasioned by the installation
or
removal of Lessee's trade fixtures, alterations, furnishings and equipment.
Except as otherwise stated in this Lease, Lessee shall leave the air lines,
power panels, electrical distribution systems, lighting fixtures, air
conditioning, window coverings, wall coverings, carpets, wall paneling, ceilings
and plumbing on the Premises in good operating condition. Should Lessee fail
to
surrender the Premises in the condition described herein, it is agreed and
understood that Lessor may elect to deem the lease as a holdover lease pursuant
to Paragraph 25 herein and Lessee shall pay rent at the rate set forth in such
Paragraph 25.
7.3
Alterations and Additions.
(a)
Lessee
shall not, without Lessor's prior written consent, make any alterations,
improvements, additions, Utility Installations or repairs in, on or about the
Premises, or the Office Building Project. As used in this paragraph 7.3, the
term "Utility Installation" shall mean carpeting, window and wall coverings,
power panels, electrical distribution systems, lighting fixtures, air
conditioning, plumbing, and telephone and telecommunication wiring and
equipment. At the expiration of the term, Lessor may elect ownership or require
the removal of any or all of said alterations, improvements, additions or
Utility Installations, and the restoration of the Premises and the Office
Building Project to their prior condition, at Lessee's expense. Should Lessor
permit Lessee to make its own alterations, improvements, additions or Utility
Installations, Lessee shall use only such contractor as has been expressly
approved by Lessor, and Lessor may require Lessee to provide Lessor, at Lessee's
sole cost and expense, a lien and completion bond in an amount equal to one
and
one-half times the estimated cost of such improvements, to insure Lessor against
any liability for mechanic's and materialmen's liens and to insure completion
of
the work. Should Lessee make any alterations, improvements, additions or Utility
Installations without the prior approval of Lessor, or use a contractor not
expressly approved by Lessor, Lessor may, at any time during the term of this
Lease, require that Lessee remove any part or all of the same.
Initials
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(b)
Any
alterations, improvements, additions or Utility Installations in or about the
Premises or the Office Building Project that Lessee shall desire to make shall
be presented to Lessor in written form, with proposed detailed plans. If Lessor
shall give its consent to Lessee's making such alterations, improvements,
additions or Utility Installations, the consent shall be deemed conditioned
upon
Lessee acquiring a permit to do so from the applicable governmental agencies,
furnishing a copy thereof to Lessor prior to the commencement of the work,
and
compliance by Lessee with all conditions of said permit in a prompt and
expeditious manner.
(c)
Lessee
shall pay, when due, all claims for labor or materials furnished or alleged
to
have been furnished to or for Lessee or for use in the Premises, which claims
are or may be secured by any mechanic's or materialmen's lien against the
Premises, the Building or the Office Building Project, or any interest
therein.
(d)
Lessee
shall give Lessor not less than ten (10) days notice prior to the commencement
of any work in the Premises by Lessee, and Lessor shall have the right to post
notices of non-responsibility in or on the Premises or the Building as provided
by law. If Lessee shall, in good faith, contest the validity of any such lien,
claim or demand, then Lessee shall, at its sole expense, defend itself and
Lessor against the same and shall pay and satisfy any such adverse judgment
that
may be rendered thereon before the enforcement thereof against the Lessor or
the
Premises, the Building or the Office Building Project, upon the condition that
if Lessor shall require, Lessee shall furnish to Lessor a surety bond
satisfactory to Lessor in an amount equal to such contested lien claim or demand
indemnifying Lessor against liability for the same and holding the Premises,
the
Building and the Office Building Project free from the effect of such lien
or
claim. In addition, Lessor may require Lessee to pay Lessor's reasonable
attorneys' fees and costs in participating in such action if Lessor shall decide
it is to Lessor's best interest so to do.
(e)
All
alterations, improvements, additions and Utility Installations (whether or
not
such Utility Installations constitute trade fixtures of Lessee), which may
be
made to the Premises by Lessee, including but not limited to, floor coverings,
paneling, doors, drapes, built-ins, moldings, sound attenuation, and lighting
and telephone or communication systems, conduit, wiring and outlets, shall
be
made and done in a good and workmanlike manner and of good and sufficient
quality and materials and shall be the property of Lessor and remain upon and
be
surrendered with the Premises at the expiration of the Lease term, unless Lessor
requires their removal pursuant to paragraph 7.3(a). Provided Lessee is not
in
default, notwithstanding the provisions of this paragraph 7.3(e), Lessee's
personal property and equipment, other than that which is affixed to the
Premises so that it cannot be removed by Lessee subject to the provisions of
paragraph 7.2.
(f)
Lessee
shall provide Lessor with as-built plans and specifications for any alterations,
improvements, additions or Utility Installations.
7.4
Utility Additions.
Lessor
reserves the right to install new or additional utility facilities throughout
the Office Building Project for the benefit of Lessor or Lessee, or any other
lessee of the Office Building Project, including, but not by way of limitation,
such utilities as plumbing, electrical systems, communication systems, and
fire
protection and detection systems, so long as such installations do not
unreasonably interfere with Lessee's use of the Premises.
8.
INSURANCE; INDEMNITY.
8.1
Liability Insurance.
(a) Carried
by Lessee. Lessee
shall obtain and keep in force a Commercial General Liability Policy of
Insurance protecting Lessee and Lessor as an additional insured against claims
for bodily injury, personal injury and property damage based upon or arising
out
of the ownership, use, occupancy or maintenance of the Premises and all areas
appurtenant thereto. Such insurance shall be on an occurrence basis providing
single limit coverage in an amount not less than $2,000,000 per occurrence
with
an "Additional
Insured-Managers and Lessors 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
not
contain any Insured exclusions as between Insured persons or organizations,
but
shall include coverage for liability assumed under this Lease as an "insured
contract" for the performance of Lessee's indemnity obligations under this
Lease. The limits of said insurance shall not, however, limit the liability
of
Lessee nor relieve Lessee of any obligation hereunder. All insurance carried
by
Lessee shall be primary to and not contributory with any similar insurance
carried by Lessor, whose insurance shall be considered excess insurance only.
(b)
Carried by Lessor.
All
insurance maintained by Lessor shall be for the sole benefit of Lessor and
under
Lessor's sole control.
(1)
Property Insurance.
Lessor
agrees to maintain property insurance insuring the Building against damage
or
destruction due to risks including fire, vandalism and malicious mischief in
an
amount not less than the replacement cost thereof in the form and with
deductibles and endorsements as selected by Lessor At its election, Lessor
may
instead obtain "All Risk" coverage, and may also obtain earthquake, pollution,
and/or flood insurance in amounts selected by Lessor.
(2)
Optional Insurance.
Lessor,
at Lessor's option, may also carry insurance against loss of rent, in an amount
equal to the amount of Base Rent and Additional Rent that Lessor could be
required to ▇▇▇▇▇ to all Building tenants in the event of condemnation, damage
or destruction for a period of twelve (12) months. Lessor may also carry such
other insurance, as Lessor may deem prudent or advisable, including, without
limitation, liability insurance in such amounts and on such terms, as Lessor
shall determine. Lessor shall not be obligated to insure any furniture,
machinery, goods, inventory or supplies which Tenant may keep or maintain in
the
Premises, or any leasehold improvements, additions or alterations within the
Premises.
(c)
Adjacent Premises.
If the
Premises are part of a larger building, or of a group of buildings owned by
Lessor which are adjacent to the Premises, the Lessee shall pay for any increase
in the premiums for the property insurance of such building or buildings if
said
increase is caused by Lessee's acts, omissions, use or occupancy of the
Premises.
8.2
Lessee's Property/Business Interruption Insurance.
(a)
Property Damage.
Lessee
shall obtain and maintain insurance coverage on all of Lessee's personal
property, Trade Fixtures, and Lessee Owned Alterations and Utility
Installations. Such insurance shall be full replacement cost coverage with
a
deductible of not to exceed $1,000 per occurrence. The proceeds from any such
insurance shall be used by Lessee for the replacement of personal property,
Trade Fixtures and Lessee Owned Alterations and Utility Installations. Lessee
shall provide Lessor with written evidence that such insurance is in
force.
(b)
Business Interruption.
Lessee
shall obtain and maintain loss of income and extra expense insurance in amounts
as will reimburse Lessee for direct or indirect loss of earnings attributable
to
all perils commonly insured against by prudent lessees in the business of Lessee
or attributable to prevention of access to the Premises as a result of such
perils.
(c)
No Representation of Adequate Coverage.
Lessor
makes no representation that the limits or forms of coverage of insurance
specified herein are adequate to cover Lessee's property, business operations
or
obligations under this Lease.
8.3
Insurance Policies.
Insurance required herein shall be by companies duly licensed or admitted to
transact business in the state where the Premises are located, and maintaining
during the policy term a "General Policyholders Rating" of at least A-, V,
as
set forth in the most current issue of "Best's Insurance Guide@
or such
other rating as may be required by a Lender. Lessee shall not do or permit
to be
done anything that invalidates the required insurance policies. Lessee shall,
prior to the Start Date, deliver to Lessor certified copies of policies of
such
insurance or certificates evidencing the existence and amounts of the required
insurance. No such policy shall be cancelable or subject to modification except
after thirty (30) days prior written notice to Lessor. Lessee shall, at least
thirty (30) days prior to the expiration of such policies, furnish Lessor with
evidence of renewals or "insurance binders" evidencing renewal thereof, or
Lessor may order such insurance and charge the cost thereof to Lessee, which
amount shall be payable by Lessee to Lessor upon demand. Such policies shall
be
for a term of at least one year, or the length of the remaining term of this
Lease, whichever is less.
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8.4
Waiver of Subrogation.
Without
affecting any other rights or remedies, Lessee and Lessor each hereby release
and relieve the other, and waive their entire right to recover damages against
the other, for loss of or damage to its property arising out of or Incident
to
the perils required to be insured against herein The effect of such releases
and
waivers is not limited by the amount of insurance carried or required, or by
any
deductibles applicable hereto. The Parties agree to have their respective
property damage insurance carriers waive any right to subrogation that such
companies may have against Lessor or Lessee, as the case may be, so long as
the
insurance is not invalidated thereby.
8.5
Indemnity.
Except
for Lessor's gross negligence or willful misconduct, Lessee shall indemnify,
protect, defend and hold harmless the Premises, Lessor and its agents, Lessor's
master or ground lessor, partners and Lenders, from and against any and all
claims, loss of rents and/or damages, liens, judgments, penalties, attorneys'
and consultants' fees, expenses and/or liabilities arising out of, involving,
or
in connection with the use and/or occupancy of the Premises by Lessee. If any
action or proceeding is brought against Lessor by reason of any of the foregoing
matters, Lessee shall upon notice defend the same at Lessee's expense by counsel
reasonably satisfactory to Lessor and Lessor shall cooperate with Lessee in
such
defense. Lessor need not have first paid any such claim in order to be defended
or indemnified.
8.6
Exemption of Lessor from Liability.
Lessor
shall not be liable for injury or damage to the person or goods, wares,
merchandise or other property of Lessee, Lessee's employees, contractors,
invitees, customers, or any other person in or about the Premises, whether
such
damage or injury is caused by or results from fire, steam, electricity, gas,
water/moisture intrusion, mold or rain, or from the breakage, leakage,
obstruction or other defects of pipes, fire sprinklers, wires, appliances,
plumbing, HVAC or lighting fixtures, or from any other cause, whether the said
injury or damage results from conditions arising upon the Premises or upon
other
portions of the Building of which the Premises are a part, or from other sources
or places, as a result of Lessor’s active or passive negligence. Lessor shall
not be liable for any damages arising from any act or neglect of any other
tenant of Lessor. Notwithstanding Lessor's negligence (active or passive) or
breach of this Lease, Lessor shall under no circumstances be liable for injury
to Lessee's business or for any loss of income or profit therefrom.
9.
DAMAGE OR DESTRUCTION.
9.1
Definitions.
(a)
"Premises Damage" shall mean if the Premises are damaged or destroyed to any
extent.
(b)
"Premises Building Partial Damage" shall mean if the Building of which the
Premises are a part is damaged or destroyed to the extent that the cost to
repair is less than fifty percent (50%) of the then Replacement Cost of the
building.
(c)
"Premises Building Total Destruction" shall mean if the Building of which the
Premises are a part is damaged or destroyed to the extent that the cost to
repair is fifty percent (50%) or more of the then Replacement Cost of the
Building.
(d)
"Office
Building Project Buildings" shall mean all of the buildings on the Office
Building Project site.
(e)
"Office
Building Project Buildings Total Destruction" shall mean if the Office Building
Project Buildings are damaged or destroyed to the extent that the cost of repair
is fifty percent (50%) or more of the then Replacement Cost of the Office
Building Project Buildings.
(f)
"Insured
Loss" shall mean damage or destruction that was caused by an event required
to
be covered by the insurance described in paragraph 8. The fact than an Insured
Loss has a deductible amount shall not make the loss an uninsured
loss.
(g)"Replacement
Cost" shall mean the amount of money necessary to be spent in order to repair
or
rebuild the damaged area to the condition that existed immediately prior to
the
damage occurring, excluding all improvements made by Lessee, other than those
installed by Lessor at Lessee's expense.
9.2
Premises Damage; Premises Building Partial Damage.
(a) Insured
Loss:
Subject
to the provisions of paragraphs 9.4 and 9.5, if at any time during the term
of
this Lease there is damage which is an Insured Loss and which falls into the
classification of either Premises Damage or Premises Building Partial Damage,
then Lessor shall, as soon as reasonably possible and to the extent the required
materials and labor are readily available through usual commercial channels,
at
Lessor's expense repair such damage (but not Lessee's fixtures, equipment or
tenant improvements originally paid for by Lessee) to its condition existing
at
the time of the damage, and this Lease shall continue in full force and
effect.
(b)
Uninsured Loss:
Subject
to the provisions of paragraphs 9.4 and 9.5, if at any time during the term
of
this Lease there is damage which is not an Insured Loss and which falls within
the classification of Premises Damage or Premises Building Partial Damage,
unless caused by a negligent or willful act of Lessee (in which event Lessee
shall make the repairs at Lessee's expense), which damage prevents Lessee from
making any substantial use of the Premises, Lessor may at Lessor's option either
(i) repair such damage as soon as reasonably possible at Lessor's expense,
in
which event this Lease shall continue in full force and effect, or (ii) give
written notice to Lessee within thirty (30) days after the date of the
occurrence of such damage of Lessor's intention to cancel and terminate this
Lease as of the date of the occurrence of such damage, in which event this
Lease
shall terminate as of the date of the occurrence of such damage.
9.3
Premises Building Total Destruction; Office Building Project Buildings Total
Destruction.
Subject
to the provisions of paragraphs 9.4 and 9.5, if at any time during the term
of
this Lease there is damage, whether or not it is an Insured Loss, which falls
into the classification of either (i) Premises Building Total Destruction,
or
(ii) Office Building Project Buildings Total Destruction, then Lessor may at
Lessor=s
option
either (i) repair such damage or destruction as soon as reasonably possible
at
Lessor=s
expense
(to the extent the required materials are readily available through usual
commercial channels) to its conditions existing at the time of the damage,
but
not Lessee=s
fixtures, equipment or tenant improvements, and this Lease shall continue in
full force and effect, or (ii) give written notice to Lessee within thirty
(30)
days after the date of occurrence of such damage of Lessor=s
intention to cancel and terminate this Lease, in which case this Lease shall
terminate as of the date of the occurrence of such damage.
9.4
Damage Near End of Term.
(a)
Subject
to paragraph 9.4(b), if at any time during the last twelve (12) months of the
term of this Lease there is substantial damage to the Premises, Lessor may
at
Lessor's option cancel and terminate this Lease as of the date of occurrence
of
such damage by giving written notice to Lessee of Lessor's election to do so
within 30 days after the date of occurrence of such damage.
(b)
Notwithstanding paragraph 9.4(a), in the event that Lessee has an option to
extend or renew this Lease, and the time within which said option may be
exercised has not yet expired, Lessee shall exercise such option, if it is
to be
exercised at all, no later than twenty (20) days after the occurrence of an
Insured Loss falling within the classification of Premises Damage during the
last twelve (12) months of the term of this Lease. If Lessee duly exercises
such
option during said twenty (20) day period, Lessor shall, at Lessor's expense,
repair such damage, but not Lessee's fixtures, equipment or tenant improvements,
as soon as reasonably possible and this Lease shall continue in full force
and
effect. If Lessee fails to exercise such option during said twenty (20) day
period, then Lessor may at Lessor's option terminate and cancel this Lease
as of
the expiration of said twenty (20) day period, notwithstanding any term or
provision in the grant of option to the contrary.
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9.5
Abatement of Rent; Lessee's Remedies.
(a)
In the
event Lessor repairs or restores the Building or Premises pursuant to the
provisions of this paragraph 9, and any part of the Premises is not usable
(including loss of use due to loss of access or essential services), the rent
payable hereunder (including Operating Expenses) for the period during which
such damage, repair or restoration continues shall be abated, provided (i)
the
damage was not the result of the negligence of Lessee, and (ii) such abatement
shall only be to the extent the operation and profitability of Lessee's business
as operated from the Premises is adversely affected . Except for said abatement
of rent, if any, Lessee shall have no claim against Lessor for any damage
suffered by reason of any such damage, destruction, repair or
restoration.
(b)
If
Lessor shall be obligated to repair or restore the Premises or the Building
under the provisions of this Paragraph 9 and shall not commence such repair
or
restoration within ninety (90) days after such occurrence, or if Lessor shall
not complete the restoration and repair within six (6) months after such
occurrence, Lessee may at Lessee's option cancel and terminate this Lease by
giving Lessor written notice of Lessee's election to do so at any time prior
to
the commencement or completion, respectively, of such repair or restoration.
In
such event this Lease shall terminate as of the date of such
notice.
(c)
Lessee
agrees to cooperate with Lessor in connection with any such restoration and
repair, including but not limited to the approval and/or execution of plans
and
specifications required.
9.6
Termination-Advance Payments.
Upon
termination of this Lease pursuant to this paragraph 9, an equitable adjustment
shall be made concerning advance rent and any advance payments made by Lessee
to
Lessor. Lessor shall, in addition, return to Lessor so much of Lessee's security
deposit as has not theretofore been applied by Lessor.
9.7
Waiver.
Lessor
and Lessee waive the provisions of any statute that relates to termination
of
leases when leased property is
destroyed and agree that such event shall be governed by the terms of this
Lease.
10.
[INTENTIONALLY LEFT BLANK]
11.
UTILITIES.
11.1
Services Provided by Lessor.
Lessor
shall provide heating, ventilation, air conditioning, and janitorial service
as
reasonably required, reasonable amounts of electricity for normal lighting
and
office machines during the days/hours set forth in subparagraph 11. 3, water
for
reasonable and normal drinking and lavatory use, and replacement light bulbs
and/or florescent tubes and ballasts for standard overhead fixtures. In the
event the cost of electricity for any single month(s) during the term of the
Lease exceeds the cost of electricity for the same month of the preceding year
by fifteen percent (15%), then such cost of electricity exceeding the fifteen
percent (15%) shall be paid by Lessee in conjunction with and in the same manner
as Base Rent.
11.2
Services Exclusive to Lessee.
Lessee
shall pay for all water, gas, heat, light, power, telephone and other utilities
and services specially or exclusively supplied and/or metered exclusively to
the
Premises or to Lessee, together with any taxes thereon. If any such services
are
not separately metered to the Premises, Lessee shall pay at Lessor's option
a
reasonable proportion to be determined by Lessor of all charges jointly metered
with other premises in the Building.
11.3
Hours of Service.
Said
services and utilities shall be provided Monday through Friday, 7:00 a.m. to
7:00 p.m. "Standard Usage" is four (4) ▇▇▇▇▇ per square foot (based on
"rentable" square footage) per hour excluding general building HVAC during
hours
of service. All usage of services and utilities on days or hours other than
Monday through Friday, 7:00 a.m. to 7:00 p.m. shall be defined as "After Hours
Usage." Lessee agrees to pay Lessor, as additional rent, the sum of $15.00
per
hour billed in increments of one (1) hour for all After Hour standard usage
of
services and utilities. Charges for such After Hour usages shall be reflected
in
the monthly statement to Lessee and shall be paid each month in conjunction
with
base rent pursuant to paragraph 4.1.
11.4
Excess Usage by Lessee.
Lessee
shall not make connection to the utilities except by or through existing outlets
and shall not install or use machinery or equipment in or about the Premises
that uses excess water, lighting or power, or suffer or permit any act that
causes extra burden upon the utilities or services, including but not limited
to
security services, over Standard Usage for the Office Building Project. Lessor
shall require Lessee to reimburse Lessor for any excess expenses or costs that
may arise out of a breach of this subparagraph by Lessee. Lessor may, in its
sole discretion, install at Lessee's expense supplemental equipment and/or
separate metering applicable to Lessee's excess usage or loading. It is agreed
and understood that all costs (including, without limitation, costs incurred
in
determining excess usage) incident to excess usage shall be paid by
Lessee.
11.5
Interruptions.
There
shall be no abatement of rent and Lessor shall not be liable in any respect
whatsoever for the inadequacy, stoppage, interruption or discontinuance of
any
utility or service due to riot, strike, labor dispute, breakdown, accident,
repair or other cause beyond Lessor's reasonable control or in cooperation
with
governmental request or directions.
12.
ASSIGNMENTS AND SUBLETTING.
12.1
Lessor's Consent Required.
(a)
Lessee
shall not voluntarily or by operation of law assign, sublet, transfer, mortgage
or encumber all or any part of Lessee=s
interest in this Lease or in the Premises without Lessor=s
prior
written consent.
A change
in the control of Lessee whether by way of merger, sale, acquisition, financing,
transfer, leveraged buy-out or otherwise, shall require Lessor=s
prior
written consent. Any such assignment, sublet, transfer, mortgage, encumbrance
or
change in control of Lessee is hereafter collectively referred to as
AAssignment
or Subletting.@
(b)
An
Assignment or Subletting without written consent shall, at Lessor's option,
be a
Default curable after notice per Paragraph 13.1(c), or a noncurable Breach
without the necessity of any notice and grace period. If Lessor elects to treat
such unapproved Assignment or Subletting as a noncurable Breach, Lessor may
either (i) terminate this Lease, or (ii) upon thirty (30) days written notice,
increase the monthly Base Rent to one hundred ten percent (110%) of the current
market rent for new leases. Further, in the event of such Breach and rental
adjustment (i) the purchase price of any option to purchase the Premises held
by
Lessee shall be subject to similar adjustment to one hundred ten percent (110%)
of the price previously in effect and (ii) all fixed and non-fixed rental
adjustments scheduled during the remainder of the Lease term shall be increased
to One Hundred Ten Percent (110%) of the current market rent for new
leases.
(c)
Lessor
and Lessee hereby acknowledge that Lessor's disapproval of any proposed
Assignment or Subletting pursuant to Paragraph 12 shall be deemed reasonably
withheld if based upon any reasonable factor, including, without limitation,
any
or all of the following factors:
(i)
The
proposed Assignment or Subletting would result in more than two subleases of
portions of the Premises being in effect at any one time during the
Term;
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6
(ii)
The net
effective rent payable by the Assignee or Sublessee (adjusted on a rentable
square foot basis) is less than the net effective rent then being quoted by
Lessor for new leases in the Building for comparable size space for a comparable
period of time;
(iii)
The
proposed Assignee or Sublessee is an existing tenant of the Project or is
negotiating with Lessor (or has negotiated with Lessor in the last six (6)
months) for space in the Project;
(iv)
The
proposed Assignee or Sublessee is a governmental entity;
(v)
The
portion of the Premises to be assigned or sublet is irregular in shape with
inadequate means of ingress and egress;
(vi)
The use
of the Premises by the Assignee or Sublessee;
(aa)
Is not
permitted by the use provisions hereof; or
(bb)
Violates
any exclusive use granted by Lessee to another tenant in the
Building;
(vii)
The
Assignment or Subletting would likely result in a significant increase in the
use of the parking areas or Common Areas by the Assignee's or
Subtenant=s
employees or visitors, and/or significantly increase the demand upon utilities
and services to be provided by Lessor to the Premises;
(viii)
The
Assignee or Sublessee does not have the financial capacity to fulfill the
obligations imposed by the Assignment or Subletting;
(ix)
The
Assignee or Sublessee is not in Lessee's reasonable opinion of reputable or
good
character or consistent with Lessee's desired tenant mix; or
(x)
Lessee
is in default or breach under this Lease as defined in Paragraph 13.1.
12.2
Terms and Conditions Applicable to Assignment and
Subletting.
(a)
Regardless
of Lessor's consent, any Assignment or Subletting shall not (i) be effective
without the express written assumption by such Assignee or Sublessee of the
obligations of Lessee under this Lease; (ii) release Lessee of any obligations
hereunder; or (iii) alter the primary liability of Lessee for the payment of
Rent or for the performance of any other obligations to be performed by
Lessee.
(b)
Lessor
may accept Rent or performance of Lessee's obligations from any person other
than Lessee pending approval or disapproval of an Assignment. Neither a delay
in
the approval or disapproval of such Assignment nor the acceptance of Rent or
performance shall constitute a waiver or estoppel of Lessor's right to exercise
its remedies for Lessee's Default or Breach.
(c)
Lessor's
consent to any Assignment or Subletting shall not constitute consent to any
subsequent Assignment or Subletting.
(d)
In the
event of any Default or Breach by Lessee, Lessor may proceed directly against
Lessee, any Guarantors or anyone else responsible for the performance of
Lessee's obligations under this Lease, including any Assignee or Sublessee,
without first exhausting Lessor's remedies against any other person or entity
responsible therefore to Lessor, or any security held by Lessor.
(e)
Each
request for consent to an Assignment or Subletting shall be in writing,
accompanied by information relevant to Lessor's determination as to the
financial and operational responsibility and appropriateness of the proposed
Assignee or Sublessee, including but not limited to the intended use and/or
required modification of the Premises, if any, together with a fee of $1,000
or
ten percent (10%) of the current monthly Base Rent applicable to the portion
of
the Premises which is the subject of the proposed Assignment or Sublease,
whichever is greater, as consideration for Lessor's considering and processing
said request. Lessee agrees to provide Lessor with such other or additional
information and/or documentation as may be reasonably requested.
(f)
Any
Assignee of, or Sublessee under, this Lease shall, by reason of accepting such
Assignment or entering into such Sublease, be deemed to have assumed and agreed
to conform and comply with each and every term, covenant, condition and
obligation herein to be observed or performed by Lessee during the term of
said
Assignment or Sublease, other than such obligations as are contrary to or
inconsistent with provisions of an Assignment or Sublease to which Lessor has
specifically consented in writing.
12.3
Additional Terms and Conditions Applicable to Subletting.
The
following terms and conditions shall apply to any Subletting by Lessee of all
or
any part of the Premises and shall be deemed included in all subleases under
this Lease whether or not expressly incorporated therein:
(a)
Subject
to paragraph 12.4, Lessee hereby assigns and transfers to Lessor all of Lessee's
interest in all Rent payable on any Sublease, and Lessor may collect such Rent
and apply same toward Lessee's obligations under this Lease; provided, however,
that until a Breach shall occur in the performance of Lessee's obligations,
Lessee may collect said Rent. Lessor shall not by reason of the foregoing or
any
Assignment of such sublease, nor by reason of the collection of Rent, be deemed
liable to the Sublessee for any failure to Lessee to perform and comply with
any
of Lessee's obligations to such Sublessee. Lessee hereby irrevocably authorizes
and directs any such Sublessee, upon receipt of a written notice from Lessor
stating that a Breach exists in the performance of Lessee's obligations under
this Lease, to pay to Lessor all Rent due and to become due under the Sublease.
Sublessee shall rely upon any such notice from Lessor and shall pay all Rents
to
Lessor without any obligation or right to inquire as to whether such Breach
exists, notwithstanding any claim from Lessee to the contrary.
(b)
In the
event of a Breach by Lessee, Lessor may, at its option, require Sublessee to
attorn to Lessor, in which event Lessor shall undertake the obligations of
the
Sublessor under such Sublease from the time of the exercise of said option
to
the expiration of such Sublease; provided, however, Lessor shall not be liable
for any prepaid rents or security deposit paid by such Sublessee to such
Sublessor or for any prior Defaults or Breaches by such Sublessor.
(c)
Any
matter requiring the consent of the Sublessor under a Sublease shall also
require the consent of Lessor.
(d)
No
Sublessee shall further assign or sublet all or any part of the Premises without
Lessor's prior written consent.
(e)
Lessor
shall deliver a copy of any Notice of Default or Breach by Lessee to the
Sublessee, who shall have the right to cure the Default of Lessee within the
grace period, if any, specified in such notice The Sublessee shall have a right
of reimbursement and offset from and against Lessee for any such Defaults cured
by the Sublessee.
(f)
Lessee
and/or Sublessee shall be responsible for paying all costs associated with
Subletting and not be entitled to credit such associated costs against rent
(or
other consideration) payable on any Sublease It is expressly understood and
agreed that all rent (or other consideration) payable on any Sublease shall
be
paid to Lessor without offset or credit.
12.4
Additional Terms and Conditions Applicable to Assignment and Subletting.
It
is the
intent of the parties hereto that the Lease shall confer upon Lessee only the
right to use and occupy the Premises and to exercise such other rights as are
conferred upon Lessee by this Lease. The parties agree that this Lease is not
intended to have a bonus or enhanced value to Lessee, nor to serve as a vehicle
whereby Lessee may profit by a future assignment or sublet of this Lease of
a
right to use or occupy the Premises as a result of any favorable terms contained
herein or any favorable changes in the market for commercial lease space. It
is
the intent of the parties that any such bonus or enhanced value that may attach
to this Lease shall be and remain the exclusive property of the Lessor. In
order
to carry out this intent, in the event Lessee seeks to assign or transfer its
interest in this Lease of the Premises, Lessor shall have the following options
which may be exercised at its sole election, without limiting Lessor in the
exercise of any other right or remedy at law or equity or under this Lease
which
Lessor may have by reason of such proposed assignment or sublet.
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7
(a)
Lessor
may terminate this Lease and release Lessee from any further rental obligations
thereunder by sending Lessee written notice of such termination within forty
-five (45) days after notice of intent to assign or sublet is deemed given
by
Lessee, provided, however, that Lessee may withdraw its notice of intent by
written notice to Lessor at any time within ten (10) days after receipt by
Lessee of Lessor=s
notice
of termination, in which event this Lease shall continue in full force and
effect. If Lessor elects to terminate this Lease and if Lessee does not withdraw
its notice of intent, Lessee shall surrender the Premises pursuant to the terms
of this Lease, within sixty (60) days after notice of intent to transfer is
deemed given by Lessee and on such date as designated by Lessor.
(b)
Lessor
may, within forty-five (45) days after notice of intent to assign or sublet
is
deemed given by Lessee, acquire the interest in this Lease and the Premises
that
Lessee proposed to assign or sublet, on the same terms and conditions as the
proposed assignment or sublet.
(c)
Lessor
may consent to the proposed assignment or sublet, provided that as a condition
to such consent, Lessor shall have the right to require that any and all rent
paid by the assignee tenant or subtenant, including, without limitation, any
rent in excess of the rentals to be paid under this Lease shall be paid directly
to Lessor at the time and place specified in this Lease. For the purpose of
this
paragraph, the term Arent@
shall
include any consideration of any kind received, or to be received from the
assignee tenant or subtenant. If such sums are related to Lessee=s interest
in the Lease or in the Premises, including, without limitation, expense
reimbursements or advances, the value of services performed, key money, bonus
money and/or payments for Lessee=s
personal property in excess of the book value of such property. The term
Apersonal
property@
as used
in this paragraph shall include, without limitation, assets, fixtures,
inventories, accounts, good will, equipment, furniture, general intangibles,
and
any capital stock or other equity ownership interest of Lessee.
DEFAULTS;
BREACH; REMEDIES.
13.1
Default; Breach.
A
"Default" is defined as a failure by the Lessee to comply with or perform any
of
the terms, covenants, conditions or rules under this Lease. A "Breach" is
defined as the occurrence of one or more of the following Defaults, and the
failure of Lessee to cure such Default within any applicable grace
period.
(a)
The
abandonment of the Premises; or the vacating of the Premises without providing
a
commercially reasonable level of security, and/or Security Deposit or where
the
coverage of the property insurance described in Paragraph 8.1 is jeopardized
as
a result thereof, or without providing reasonable assurances to minimize
potential vandalism.
(b)
The
failure of Lessee to make any payment of Rent, Operating Expense, or any
Security Deposit required to be made by Lessee hereunder, whether to Lessor
or
to a third party, when due, to provide reasonable evidence of insurance or
surety bond, or to fulfill any obligation under this Lease which endangers
or
threatens life or property, where such failure continues for a period of three
(3) days following written notice to Lessee.
(c)
The
failure by Lessee to provide (i) reasonable written evidence of compliance
with
Applicable Requirements, (ii) the service contracts, (iii) the rescission of
an
unauthorized Assignment or Subletting, (iv) a Tenancy Statement, (v) a requested
subordination, (vi) evidence concerning any guaranty and/or Guarantor, (vii)
any
document requested under Paragraph 40 (easements), or (viii) any other
documentation or information which Lessor may reasonably require of Lessee
under
the terms of this Lease, where any such failure continues for a period of three
(3) days following written notice to Lessee.
(d)
A
Default by Lessee as to the terms, covenants, conditions or provisions of this
Lease, or of the attached rules adopted hereunder including, without limitation,
Vehicle Parking (Paragraph 2.2), Security Deposit (Paragraph 5), Use (Paragraph
6), Maintenance and Alterations (Paragraphs 7.2, 7.3 and 7.4), Utilities
(Paragraph 11), Assignment and Subletting (Paragraph 12), Lessor=s
Access
(Paragraph 32), Hazardous Substances (Paragraph 49), where such Default
continues for a period of three (3) days after written notice.
(e)
The
occurrence of any of the following events: (i) the making of any general
arrangement or assignment for the benefit of creditors; (ii) becoming a
Adebtor@
as
defined in 11 U.S.C. Sec. 101 or any successor statute thereto (unless, in
the
case of a petition filed against Lessee, the same is dismissed within sixty
(60)
days); (iii) the appointment of a trustee or receiver to take possession of
substantially all of Lessee's assets located at the Premises or of Lessee's
interest in this Lease, where possession is not restored to Lessee within thirty
(30) days; or (iv) the attachment, execution or other judicial seizure of
substantially all of Lessee's assets located at the Premises or of Lessee's
interest in this Lease, where such seizure is not discharged within thirty
(30)
days; provided, however, in the event that any provision of this subparagraph
(e) is contrary to any applicable law, such provision shall be of no force
or
effect, and not affect the validity of the remaining provisions.
(f)
The
discovery that any financial statement of Lessee or of any Guarantor given
to
Lessor was materially false.
(g)
If the
performance of Lessee's obligations under this Lease is guaranteed (i) the
death
of a Guarantor; (ii) the termination of a Guarantor's liability with respect
to
this Lease other than in accordance with the terms of such guaranty; (iii)
a
Guarantor's becoming insolvent or the subject of a bankruptcy filing; (iv)
a
Guarantor's refusal to honor the guaranty; or (v) a Guarantor's breach of its
guaranty obligation on an anticipatory basis, and Lessee's failure, within
sixty
(60) days following written notice of any such event, to provide written
alternative assurance or security, which, when coupled with the then existing
resources of Lessee, equals or exceeds the combined financial resources of
Lessee and the Guarantors that existed at the time of execution of this
Lease.
(h)
In the
event Lessee has one or more additional leases for other premises in the Office
Building Project, then it is acknowledged and agreed that a default under such
additional lease(s) shall also constitute a default under this
Lease.
13.2
Remedies.
If
Lessee fails to perform any of its affirmative duties or obligations, within
ten
(10) days after written notice (or in case of an emergency, without notice),
Lessor may, at its option, perform such duty or obligation on Lessee's behalf,
including but not limited to the obtaining of reasonably required bonds,
insurance policies, or governmental licenses, permits or approvals. The costs
and expenses of any such performance by Lessor shall be due and payable by
Lessee upon receipt of invoice therefore. If any check given to Lessor by Lessee
shall not be honored by the bank upon which it is drawn, Lessor, at its option,
may require all future payments to be made by Lessee to be by cashier's check.
In the event of a Breach, Lessor may, with or without further notice or demand,
and without limiting Lessor in the exercise of any right or remedy, which Lessor
may have by reason of such Breach:
(a)
Terminate Lessee's right to possession of the Premises by any lawful means,
in
which case this Lease shall terminate and Lessee shall immediately surrender
possession to Lessor. In such event Lessor shall be entitled to recover from
Lessee (i) the unpaid Rent which had been earned at the time of termination;
(ii) the worth at the time of award of the amount by which the unpaid rent
which
would have been earned after termination until the time of award exceeds the
amount of such rental loss that the Lessee proves could have been reasonably
avoided; (iii) 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 the Lessee proves could be reasonably avoided: and (iv)
any other amount necessary to compensate Lessor for all the detriment
proximately caused by the Lessee's failure to perform its obligations under
this
Lease or which in the ordinary course of things would be likely to result
therefrom, including but not limited to the cost of recovering possession of
the
Premises, expenses of reletting, including necessary renovation and alteration
of the Premises, reasonable attorneys' fees, and that portion of any leasing
commission paid by Lessor in connection with this Lease applicable to the
unexpired term of this Lease. The worth at the time of award of the amount
referred to in provision (iii) of the immediately preceding sentence shall
be
computed by discounting such amount at the discount rate of the Federal Reserve
Bank of the District within which the Premises are located at the time of award
plus one percent (1%). Efforts by Lessor to mitigate damages caused by Lessee's
Breach of this Lease shall not waive Lessor's right to recover damages under
Paragraph 12.If termination of this Lease is obtained through the provisional
remedy of unlawful detainer, Lessor shall have the right to recover in such
proceeding any unpaid Rent and damages as are recoverable therein, or Lessor
may
reserve the right to recover all or any part thereof in a separate suit. If
a
notice and grace period required under Paragraph 13.1 were not previously given,
a notice to pay rent or quit, or to perform or quit given to Lessee under the
unlawful detainer statute shall also constitute the notice required by Paragraph
13.1. In such case, the applicable grace period required by Paragraph 13.1
and
the unlawful detainer statute shall run concurrently, and the failure of Lessee
to cure the Default within the greater of the two such grace periods shall
constitute both an unlawful detainer and a Breach of this Lease entitling Lessor
to the remedies provided for in this Lease and/or by said statute.
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(b)
Continue
this Lease and Lessee's right to possession and recover the Rent as it becomes
due, in which event Lessee may sublet or assign, subject only to reasonable
limitations, as described in California Civil Code Section 1951.4. Acts of
maintenance, efforts to re-let, and/or the appointment of a receiver to protect
the Lessor's interests, shall not constitute a termination of the Lessee's
right
to possession.
(c)
Pursue
any other remedy now or hereafter available under the laws or judicial decisions
of the state wherein the Premises are located. The expiration or termination
of
this Lease and/or the termination of Lessee's right to possession shall not
relieve Lessee from liability under any indemnity provisions of this Lease
as to
matters occurring or accruing during the term hereof or by reason of Lessee's
occupancy of the premises.
13.3
Inducement Recapture.
Any
agreement for free or abated rent or other charges, or for the giving or paying
by Lessor to or for Lessee of any cash or other bonus, inducement or
consideration for Lessee's entering into this Lease, all of which concessions
are hereinafter referred to as "Inducement Provisions," shall be deemed
conditioned upon Lessee's full and faithful performance of all of the terms,
covenants and conditions of this Lease. Upon Breach of this Lease by Lessee,
any
such Inducement Provision shall automatically be deemed deleted from this Lease
and of no further force or effect, and any rent, other charge, bonus, inducement
or consideration theretofore abated, given or paid by Lessor under such an
inducement Provision shall be immediately due and payable by Lessee to Lessor,
notwithstanding any subsequent cure of said Breach by Lessee The acceptance
by
Lessor of rent or the cure of the Breach which initiated the operation of this
paragraph shall not be deemed a waiver by Lessor of the provisions of this
paragraph unless specifically so stated in writing by Lessor at the time of
such
acceptance.
13.4
Late Charges.
Lessee
hereby acknowledges that late payment by Lessee of Rent will cause Lessor to
incur costs not contemplated by this Lease, the exact amount of which will
be
extremely difficult to ascertain. Such costs include, but are not limited to,
processing and accounting charges, and late charges that may be imposed upon
Lessor by any Lender. Accordingly, if any Rent shall not be received by Lessor
within five (5) days after such amount shall be due, then, without any
requirement for notice to Lessee, Lessee shall pay to Lessor a one-time late
charge equal to six percent (6%) of each such overdue amount. The parties hereby
agree that such late charge represents a fair and reasonable estimate of the
costs Lessor will incur by reason of such late payment. Acceptance of such
late
charge by Lessor shall in no event constitute a waiver of Lessee's Default
or
Breach with respect to such overdue amount, nor prevent the exercise of any
of
the other rights and remedies granted hereunder. In the event that a late charge
is payable hereunder, whether or not collected, for three (3) consecutive
installments of Base Rent, then notwithstanding any provision of this Lease
to
the contrary, Base Rent shall, at Lessor's option, become due and payable
quarterly in advance.
13.5
Returned Check Charges.
Lessee
hereby acknowledges and agrees that a service charge of $50.00 will be assessed
and charged to Lessee for each check that is returned because of insufficient
funds.
13.6
Notice to Pay Rent Charge.
Lessee
hereby acknowledges and agrees that a charge of $75.00 will be assessed and
charged to Lessee for each Three Day Notice to Pay Rent or Quit (or other
termination notice based on Default) served on Lessee.
14.
CONDEMNATION.
If the
Premises or any portion thereof or the Office Building Project are taken under
the power of eminent domain, or sold under the threat of the exercise of said
power (all of which are herein called "condemnation"), this Lease shall
terminate as to the part so taken as of the date the condemning authority takes
title or possession, whichever first occurs; provided that if so much of the
Premises or the Office Building Project are taken by such condemnation as would
substantially and adversely affect the operation and profitability of Lessee's
business conducted from the Premises, Lessee shall have the option, to be
exercised only in writing within thirty (30) days after Lessor shall have given
Lessee written notice of such taking (or in the absence of such notice, within
thirty (30) days after the condemning authority shall have taken possession),
to
terminate this Lease as of the date the condemning authority takes such
possession. If Lessee does not terminate this Lease in accordance with the
foregoing, this Lease shall remain in full force and effect as to the portion
of
the Premises remaining, except that the rent shall be reduced in the proportion
that the floor area of the Premises taken bears to the total floor area of
the
Premises, Common Areas taken shall be excluded from the Common Areas usable
by
Lessee and no reduction of rent shall occur with respect thereto or by reason
thereof. Lessor shall have the option in its sole discretion to terminate this
Lease as of the taking of possession by the condemning authority, by giving
written notice to Lessee of such election within thirty (30) days after receipt
of notice of a taking by condemnation of any part of the Premises or the Office
Building Project Any award for the taking of all or any part of the Premises
or
the Office Building Project under the power of eminent domain or any diminution
in value of the leasehold or for the taking of the fee, or as severance damages;
provided, however, that Lessee shall be entitled to any separate award for
loss
of or damage to Lessee's trade fixtures, removable personal property and
unamortized tenant improvements that have been paid for by Lessee. For that
purpose the cost of such improvements shall be amortized over the original
term
of this Lease excluding any options. In the event that this Lease is not
terminated by reason of such condemnation, Lessor shall to the extent of
severance damages received by Lessor in connection with such condemnation,
repair any damage to the Premises caused by such condemnation except to the
extent that Lessee has been reimbursed therefor by the condemning authority.
Lessee shall pay any amount in excess of such severance damages required to
complete such repair.
15.
ESTOPPEL CERTIFICATE.
(a)
Each
party (as Aresponding
party@)
shall
at any time upon not less than ten (10) days prior written notice from the
other
party (Arequesting
party@)
execute, acknowledge and deliver to the requesting party 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 which the
rent
and other charges are paid in advance, if any, and (ii) acknowledging that
there
are not, to the responding party=s
knowledge, any uncured defaults on the part of the requesting party, or
specifying such defaults if any are claimed. Any such statement may be
conclusively relied upon by any prospective purchaser or encumbrancer of the
Office Building Project or of the business of Lessee.
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(b)
At the
requesting party=s
option,
the failure to deliver such statement within such time shall be a material
default of this Lease by the party who is to respond, without any further notice
to such party, or it shall be conclusive upon such party that (i) this Lease
is
in full force and effect, without modification except as may be represented
by
the requesting party, (ii) there are not uncured defaults in the requesting
party's performance, and (iii) if Lessor is the requesting party, not more
than
one month's rent has been paid in advance.
(c)
If
Lessor desires to finance, refinance, or sell the Office Building Project,
or
any part thereof, Lessee hereby agrees to deliver to any lender or purchaser
designated by Lessor such financial statements of Lessee as may be reasonably
required by such lender or purchaser. Such statements shall include the past
three (3) years financial statements of Lessee. All such financial statements
shall be received by Lessor and such lender or purchaser in confidence and
shall
be used only for the purposes herein set forth.
16.
LESSOR'S LIABILITY.
The
term "Lessor" as used herein shall mean only the owner or owners, at the time
in
question, of the fee title or a lessee's interest in a ground lease of the
Office Building Project. In the event of any transfer of such title or interest,
Lessor herein named (and in case of any subsequent transfers then the grantor)
shall be relieved from and after the date of such transfer of all liability
as
respects Lessor's obligations thereafter to be performed, provided that any
funds in the hands of Lessor or the then grantor at the time of such transfer,
in which Lessee has an interest, shall be delivered to the grantee. The
obligations contained in this Lease to be performed by Lessor shall, subject
as
aforesaid, be binding on Lessor's successors and assigns only during their
respective periods of ownership.
17.
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.
18.
INTEREST ON PAST-DUE OBLIGATIONS.
Except
as expressly herein provided, any amount due to Lessor not paid when due shall
bear interest at the maximum rate then allowable by law or judgments from the
date due. Payment of such interest shall not excuse or cure any default by
Lessee under this Lease; provided, however, that interest shall not be payable
on late charges incurred by Lessee.
19.
TIME OF ESSENCE.
Time is
of the essence with respect to the obligations to be performed under this
Lease.
20.
ADDITIONAL RENT.
All
monetary obligations of Lessee to Lessor under the terms of this Lease,
including but not limited to late charges, Three-Day Notice charges (Paragraph
13.6), returned check charges, attorney's fees and any other expenses payable
by
Lessee hereunder shall be deemed to be rent.
20.1
Credits to Lessee's Account.
Lessor
shall promptly credit Lessee's account for all payments received from Lessee.
Such payments shall be first credited to those sums due under this Lease
Agreement, including but not limited to Base Rent, late charges, 3-Day Notice
charges (Paragraph 13.6), returned check fees and attorney's fees which were
incurred earliest in time (oldest chargeable items). Nothing in this paragraph
(including Lessor's acceptance of a partial payment on account balance) shall
be
construed or constitute a waiver by Lessor of any provision hereof or of any
subsequent breach by Lessee of the same or any other provision.
21.
INCORPORATION OF PRIOR AGREEMENTS; AMENDMENTS.
This
Lease contains all agreements of the parties with respect to any matter
mentioned herein. No prior or contemporaneous agreement or understanding
pertaining to any such matter shall be effective. This Lease may be modified
in
writing only, signed by the parties in interest at the time of the modification.
Except as otherwise stated in this Lease, Lessee hereby acknowledged that
neither any cooperating broker on this transaction nor the Lessor nor any
employee or agents of any of said persons has made any oral or written
warranties or representations to Lessee relative to the condition or use by
Lessee of the Premises or the Office Building Project and Lessee acknowledges
that Lessee assumes all responsibility regarding the Occupational Safety Health
Act and the Americans with Disabilities Act, the legal use and adaptability
of
the Premises and the compliance thereof with all applicable laws and regulations
in effect during the term of this Lease.
22.
NOTICES.
Any
notice required or permitted to be given hereunder shall be in writing and
may
be given by personal delivery or by certified or registered mail, and shall
be
deemed sufficiently given if delivered or addressed to Lessee or to Lessor
at
the address noted below or adjacent to the signature of the respective parties,
as the case may be. Mailed notices shall be deemed given upon actual receipt
at
the address required, or forty-eight hours following deposit in the mail,
postage prepaid, whichever first occurs. Either party may by notice to the
other
specify a different address for notice purposes except that upon Lessee's taking
possession of the Premises, the Premises shall constitute Lessee's address
for
notice purposes. A copy of all notices required or permitted to be given to
Lessor hereunder shall be concurrently transmitted to such party or parties
at
such addresses as Lessor may from time to time hereafter designate by notice
to
Lessee.
23.
WAIVERS.
No
waiver by Lessor of any provision hereof shall be deemed a waiver of any other
provision hereof or of any subsequent breach by Lessee of the same or any other
provision. Lessor's consent to, or approval of, any act shall not be deemed
to
render unnecessary the obtaining of Lessor's consent to or approval of any
subsequent act by Lessee. The acceptance of rent hereunder by Lessor shall
not
be a waiver of any preceding breach by Lessee of any provision hereof, other
than the failure of Lessee to pay the particular rent so accepted, regardless
of
Lessor's knowledge of such preceding breach at the time of acceptance of such
rent.
24.
RECORDING.
Either
Lessor or Lessee shall, upon request of the other, execute, acknowledge and
deliver to the other a 'short form' memorandum of this Lease for recording
purposes.
25.
HOLDING OVER. If
Lessee, with Lessor’s consent, remains in possession of the Premises or any part
thereof after the expiration of the term hereof, such occupancy shall be a
tenancy as defined by Section 1945 of the California Civil Code with all of
the
provisions of this Lease pertaining to the obligations of Lessee, except that
the rent payable shall be two hundred percent (200%) of the rent payable
immediately preceding the termination date of this Lease, and all Options,
if
any, granted under the terms of this Lease shall be deemed terminated and be
of
no further effect during said tenancy.
26.
BROKERAGE COMMISSIONS:
Lessee
represents and warrants that Lessee has dealt with no broker or agent other
than: none. Lessee agrees to indemnify and hold the Lessor harmless from and
against any claims by any broker, agent or other person/entity claiming a
commission or other form of compensation by virtue of having dealt with Lessee
with regard to this leasing transaction. The provisions of this paragraph shall
survive the termination of this Lease.
27.
CUMULATIVE DAMAGES.
No
remedy or election hereunder shall be deemed exclusive but shall, wherever
possible, be cumulative with all other remedies at law or in
equity.
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28.
COVENANTS AND CONDITIONS.
Each
provision of this Lease performable by Lessee shall be deemed both a covenant
and condition.
29.
BINDING EFFECT; CHOICE OF LAW.
Subject
to any provisions hereof restricting Assignment or Subletting by Lessee and
subject to the provisions of paragraph 16, 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 Office Building Project is located
and any litigation concerning this Lease between the parties hereto shall be
initiated in the county in which the Office Building Project is
located.
30.
SUBORDINATION.
(a)
This
Lease, and any Option or right of first refusal granted hereby, at Lessor's
option, shall be subordinate to any ground lease, mortgage, deed of trust,
or
any other hypothecation or security now or hereafter placed upon the Office
Building Project and to any and all advances made on the security thereof and
to
all renewals, modifications, consolidations, replacements and extensions
thereof. Notwithstanding such subordination, Lessee's right to quiet possession
of the Premises shall not be disturbed if Lessee is not in default and so long
as Lessee shall pay the rent and observe and perform all of the provisions
of
this Lease, unless this Lease is otherwise terminated pursuant to its terms.
If
any mortgagee, trustee or ground lessor shall elect to have this Lease and
any
Options granted hereby prior to the lien of its mortgage, deed of trust or
ground lease, and shall give written notice thereof to Lessee, this Lease and
such Options shall be deemed prior to such mortgage, deed of trust or ground
lease, whether this Lease or such Options are dated prior or subsequent to
the
date of said mortgage, deed of trust or ground lease or the date of recording
thereof.
(b)
Lessee
agrees to execute any documents required to effectuate an attornment,
subordination, or to make this Lease or any Option granted herein prior to
the
lien of any mortgage, deed of trust or ground lease, as the case may be.
Lessee=s
failure
to execute such documents within ten (10) days after written demand shall
constitute a material default by Lessee hereunder without further notice to
Lessee or, at Lessor=s
option,
Lessor shall execute such documents on behalf of Lessee and Lessee=s
attorney-in-fact. Lessee does hereby make, constitute and irrevocably appoint
Lessor as Lessee=s
attorney-in-fact and in Lessee=s
name,
place and stead, to execute such documents in accordance with this paragraph
30(b).
31.
ATTORNEY=S
FEES.
31.1
If
either party brings (or defends) an action to enforce the terms hereof or
declare rights hereunder, the prevailing party in any such action, trial or
appeal thereon, shall be entitled to its reasonable attorneys' fees to be paid
by the losing party as fixed by the court in the same or a separate suit, and
whether or not such action is pursued to decision or judgment.
31.2
The
attorneys' fee award shall not be computed in accordance with any court fee
schedule, but shall be such as to fully reimburse all attorneys' fees reasonably
incurred in good faith.
31.3
In
addition to the charges authorized in Section 13.6, Lessor shall be entitled
to
reasonable attorneys' fees and all other costs and expenses incurred in the
preparation and service of notice of default and consultations in connection
therewith and any other legal services necessitated by Lessee default, whether
or not a legal action is subsequently commenced in connection with such
default.
31.4 Jury
Trial Waiver.
To the
extent permitted by law, Lessor and Lessee hereby waive their respective right
to trial by jury of any cause of action, claim, counterclaim or cross-complaint
in any action, proceeding and/or hearing brought by either Lessor against Lessee
or Lessee against Lessor on any matter whatsoever arising out of, or in any
way
connected with, this lease, the relationship of Lessor and Lessee, Lessee's
use
or occupancy of the Premises, or any claim of injury or damage, or the
enforcement of any remedy under any law, statute, or regulation, emergency
or
otherwise, now or hereafter in effect.
32.
LESSOR'S ACCESS.
32.1
Lessor
and Lessor's agents shall have the right to enter the Premises at reasonable
times (Monday through Friday, during normal business hours, following
twenty-four (24) hours telephonic notice by Lessor or Lessor's agents) for
the
purpose of inspecting the same, performing any services required of Lessor,
showing the same to prospective purchasers, lenders, or lessees, taking such
safety measures, erecting such scaffolding or other necessary structures, making
such alterations, repairs, improvements or additions to the Premises or the
Office Building Project as Lessor may reasonably deem necessary or desirable
and
the erecting, using and maintaining of utilities, services, pipes and conduits
through the Premises and/or other premises. Lessor may at any time place on
or
about the Premises or the Building any ordinary "For Sale" signs and Lessor
may
at any time during the last six (6) months of the term hereof place on or about
the Premises any ordinary "For Lease" signs.
32.2
All
activities of Lessor pursuant to this paragraph shall be without abatement
of
rent, and Lessor shall not have any liability to Lessee for the same.
32.3
Lessor
shall have the right to retain keys to the Premises and to unlock all doors
in
or upon the Premises other than to files, vaults and safes, and in the case
of
an emergency to enter the Premises by any reasonably appropriate means, and
any
such entry shall not be deemed a forceable or unlawful entry or detainer of
the
Premises or an eviction. Lessee waives any charges for damages or injuries
or
interference with Lessee's property or business in connection
therewith.
33.
AUCTIONS. Lessee
shall not conduct, nor permit to be conducted, either voluntarily or
involuntarily, an auction upon the premises or the Common Areas without first
having obtained Lessor's prior written consent. Notwithstanding anything to
the
contrary in this Lease, Lessor shall not be obligated to exercise any standard
of reasonableness in determining whether to grant such consent. The holding
of
any auction on the Premises or Common Areas in violation of this paragraph
shall
constitute a material default of this Lease.
34.
SIGNS.
Lessee
shall not place any sign upon the Premises or the Office Building Project
without Lessor's prior written consent. Under no circumstances shall Lessee
place a sign on any roof of the Office Building Project.
35.
MERGER.
The
voluntary or other surrender of this Lease by Lessee, or a mutual cancellation
thereof, or a termination by Lessor, shall not work a merger, and shall, at
the
option of Lessor, terminate all or any existing subtenancies or may, at the
option of Lessor, operate as an assignment to Lessor of any or all of such
subtenancies.
36.
CONSENTS.
Except
for paragraphs 33 (auctions) and 34 (signs) hereof, wherever in this Lease
the
consent of one party is required to an act of the other party such consent
shall
not be unreasonably withheld or delayed.
37.
GUARANTOR.
In the
event that there is a guarantor of this Lease, said guarantor shall have the
same obligations as Lessee under this Lease.
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38.
OPTIONS.
38.1 Definition.
"Option"
shall
mean (a) the right to extend the term of or renew this Lease or to extend or
renew any lease that Lessee has on other property of Lessor; (b) the right
of
first refusal or first offer to lease either the Premises or other property
of
Lessor; (c) the right to purchase or the right of first refusal to purchase
the
Premises or other property of Lessor.
38.2 Options
Personal to Original Lessee.
Each
option granted to Lessee in this Lease is personal to the original Lessee,
and
cannot be assigned or exercised by anyone other than said original Lessee and
only while the original Lessee is in full possession of the Premises and, if
requested by Lessor, with Lessee certifying that Lessee has no intention of
thereafter assigning or Subletting.
38.3
Multiple Options.
In the
event that Lessor has any multiple options to extend or renew this Lease, a
later Option cannot be exercised unless the prior Options have been validly
exercised.
38.4
Effect of Default on Options.
(a)
Lessee
shall have no right to exercise an Option (i) during the period commencing
with
the giving of any notice of Default and continuing until said Default is cured;
(ii) during the period of time any Rent is unpaid (without regard to whether
notice thereof is given Lessee); (iii) during the time Lessee is in Breach of
this Lease; or (iv) in the event that Lessee has been given three (3) or more
notices of separate Default, whether or not the Defaults are cured, during
the
twelve (12) month period immediately preceding the exercise of the Option;
(v)
becoming a "debtor" as defined in II USC Sec 101 during the term of this
Lease.
(b)
The
period of time within which an Option may be exercised shall not be extended
or
enlarged by reason of Lessee's inability to exercise an Option because of the
provisions of paragraph 38.4(a).
(c)
An
Option shall terminate and be of no further force or effect, notwithstanding
Lessee's due and timely exercise of the Option, if, after such exercise and
prior to the commencement of the extended term, (i) Lessee fails to pay Rent
for
a period of thir1y (30) days after such Rent becomes due (without any necessity
of Lessor to give notice thereof), (ii) Lessor gives to Lessee three (3) or
more
notices of separate Default during any twelve (12) month period, whether or
not
the Defaults are cured, or (iii) if Lessee commits a Breach of this
Lease.
39.
SECURITY MEASURES - LESSOR'S RESERVATIONS.
39.1
Lessee
hereby acknowledges that Lessor shall have no obligation whatsoever to provide
guard service or other security measures for the Project in the Common
Areas;
39.2
Lessee
shall not:
(a)
Use a
representation (photographic or otherwise) of the Building or the Office
Building Project or their name(s) in connection with Lessee's
business;
(b)
Suffer
or permit anyone, except in emergency, to go upon the roof of the
Building.
40.
EASEMENTS.
40.1
Lessor
reserves to itself the right, from time to time, to grant such easements, rights
and dedications that Lessor deems necessary or desirable and to cause the
recordation of Parcel Maps and restrictions, so long as such easements, rights,
dedications, Maps and restrictions do not unreasonably interfere with the use
of
the Premises by Lessee. Lessee shall sign any of the aforementioned documents
upon request of Lessor and failure to do so shall constitute a material default
of this Lease by Lessee without the need for further notice to
Lessee.
40.2
The
obstruction of Lessee's view, air, or light by any structure erected in the
vicinity of the Building, whether by Lessor or third parties, shall in no way
affect this Lease or impose any liability upon Lessor.
41.
PERFORMANCE UNDER PROTEST.
If at
any time a dispute shall arise as to any amount or sum of money to be paid
by
one party to the other under the provisions hereof, the party against whom
the
obligation to pay the money is asserted shall have the right to make payment
"under protest" and such payment shall not be regarded as a voluntary payment,
and there shall survive the right on the part of said party to institute suit
for recovery of such sum. If it shall be adjudged that there was no legal
obligation on the part of said party to pay such or any part thereof, said
party
shall be entitled to recover such sum or so much thereof as it was not legally
required to pay under the provisions of this Lease.
42.
AUTHORITY.
If
Lessee is a corporation, trust, or general or limited partnership, Lessee,
and
each individual executing this Lease on behalf of such entity, represent and
warrant that such individual is duly authorized to execute and deliver this
Lease on behalf of said entity. If Lessee is a corporation, trust or
partnership, Lessee shall, within thirty (30) days after execution of this
Lease, deliver to Lessor evidence of such authority satisfactory to
Lessor.
43.
CONFLICT.
Any
conflict between the printed provisions, Exhibits or Addendum of this Lease
and
the typewritten or handwritten provisions, if any, shall be controlled by the
typewritten or handwritten provisions.
44.
NO OFFER.
Preparation of this Lease by Lessor or Lessor's agent and submission of same
to
Lessee shall not be deemed an offer to Lessee to lease. This Lease shall become
binding upon Lessor and Lessee only when fully executed by both parties.
45.
LENDER MODIFICATIONS.
Lessee
agrees to make such reasonable modifications to this Lease as may be reasonably
required by an institutional lender in connection with the obtaining of normal
financing or refinancing of the Office Building Project.
46.
MULTIPLE PARTIES.
If more
than one person or entity is named as either Lessor or Lessee herein, except
as
otherwise expressly provided herein, the obligations of the Lessor or Lessee
herein shall be the joint and several responsibility of all persons or entities
named herein as such Lessor or Lessee, respectively.
47.
WORK LETTER.
N/A.
48.
ATTACHMENTS.
Attached hereto are the following documents ("Exhibits") that are incorporated
and become part of this Lease:
(a)
Rules
and Regulations (‘Exhibit A’).
(b)
Other
(specify):
Initials
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12
49.
HAZARDOUS SUBSTANCES.
49.1
Reportable Uses Require Consent.
(a)
The term
"Hazardous
Substance"
as used
in this Lease shall mean any product, substance, or waste whose presence, use,
manufacture, disposal, transportation, or release, either by itself or in
combination with other materials expected to be on the Premises, is either
(i)
potentially injurious to the public health, safety or welfare, the environment
or the Premises, (ii) regulated or monitored by any governmental authority,
or
(iii) a basis for potential liability of Lessor to any governmental agency
or
third party under any applicable statute or common law theory. Hazardous
Substances shall include, but not be limited to, hydrocarbons, petroleums,
gasoline, and/or crude oil or any products, by-products or fractions thereof.
Lessee shall not engage in any activity in or on the Premises which constitutes
a Reportable Use of Hazardous Substances without the express prior written
consent of Lessor and timely compliance (at Lessee's expense) with all
applicable laws, covenants, or restrictions of record, building codes,
regulations and ordinances ("Applicable Requirements"). "Reportable Use" shall
mean (i) the installation or use of any above or below ground storage tank,
(ii)
the generation, possession, storage, use, transportation, or disposal of a
Hazardous Substance that requires a permit from, or with respect to which a
report, notice, registration or business plan is required to be filed with
any
governmental authority, and/or (iii) the presence at the Premises of a Hazardous
Substance with respect to which any Applicable Requirements require that a
notice be given to persons entering or occupying the Premises or neighboring
properties. Notwithstanding the foregoing, Lessee may use any ordinary and
customary materials reasonably required to be used in the normal course of
the
Use as specified in paragraph 1.4 so long as such use is in compliance with
all
Applicable Requirements, is not a Reportable Use, and does not expose the
Premises or neighboring property to any meaningful risk of contamination or
damage or expose Lessor to any liability therefor. In addition, Lessor may
condition its consent to any Reportable Use upon receiving such additional
assurances as Lessor reasonably deems necessary to protect itself, the public,
the Premises and/or the environment against damage, contamination, injury and/or
liability, including, but not limited to, the installation (and removal on
or
before Lease expiration or termination) of protective modifications (such as
concrete encasements) and/or increasing the Security Deposit.
(b)
Duty to Inform Lessor.
If
Lessee knows, or has reasonable cause to believe, that a Hazardous Substance
has
come to be located in, on, under or about the Premises, other than as previously
consented to by Lessor, Lessee shall immediately give written notice of such
fact to Lessor, and provide Lessor with a copy of any report, notice, claim
or
other documentation which it has concerning the presence of such Hazardous
Substance.
(c)
Lessee Remediation.
Lessee
shall not cause or permit any Hazardous Substance to be spilled or released
in,
on, under, or about the Premises (including through the plumbing or sanitary
sewer system) and shall promptly, at Lessee's expense, take all investigatory
and/or remedial action reasonably recommended, whether or not formally ordered
or required, for the cleanup of any contamination of, and for the maintenance,
security and/or monitoring of the Premises or neighboring properties, that
was
caused or materially contributed to by Lessee, or pertaining to or involving
any
Hazardous Substance brought onto the Premises during the term of this Lease,
by
or for Lessee, or any third party.
(d)
Lessee Indemnification.
Lessee
shall indemnify, defend and hold Lessor, its agents, employees, lenders and
ground lessor, if any, harmless from and against any and all loss of rents
and/or damages, liabilities, judgments, claims, expenses, penalties, and
attorneys' and consultants' fees arising out of or involving any Hazardous
Substance brought onto the Premises by or for Lessee, or any third party
(provided, however, that Lessee shall have no liability under this Lease with
respect to underground migration of any Hazardous Substance under the Premises
from adjacent properties). Lessee's obligations shall include, but not be
limited to, the effects of any contamination or injury to person, property
or
the environment created or suffered by Lessee, and the cost of investigation,
removal, remediation, restoration and/or abatement, and shall survive the
expiration or termination of this Lease. No termination, cancellation or release
agreement entered into by Lessor and Lessee shall release Lessee from its
obligations under this Lease with respect to Hazardous Substances, unless
specifically so agreed by Lessor in writing at the time of such agreement.
(e)
Lessor Indemnification.
Lessor
and its successors and assigns shall indemnify, defend, reimburse and hold
Lessee, its employees and lenders, harmless from and against any all
environmental damages, including the cost remediation, which existed as a result
of Hazardous Substances on the Premises prior to the Commencement Date or which
are caused by the gross negligence or willful misconduct of Lessor, its agents
or employees. Lessor's obligations, as and when required by the Applicable
Requirements, shall include, but not be limited to, the cost of investigation,
removal, remediation, restoration and/or abatement, and shall survive the
expiration or termination of this Lease.
(f)
Investigations and Remediations.
Lessor
shall retain the responsibility and pay for any investigations or remediation
measures required by governmental entities having jurisdiction with respect
to
the existence of Hazardous Substances on the Premises prior to the Commencement
Date, unless such remediation measure is required as a result of Lessee's use
(including "Alterations", as defined in paragraph 7.3(a) (above) of the
Premises, In which event Lessee shall be responsible for such payment. Lessee
shall cooperate fully in any such activities at the request of Lessor, including
allowing Lessor and Lessor's agents to have reasonable access to the Premises
at
reasonable times in order to carry out Lessor's investigative and remedial
responsibilities.
(g)
Lessor Termination Option.
If a
Hazardous Substance Condition occurs during the term of this Lease, unless
Lessee is legally responsible therefor (in which case Lessee shall make the
investigation and remediation thereof required by the Applicable Requirements
and this Lease shall continue in full force and effect, but subject to Lessor's
rights under Paragraph 13), Lessor may, at Lessor's option, either (i)
investigate and remediate such Hazardous Substance Condition, if required,
as
soon as reasonably possible at Lessor's expense, in which event this Lease
shall
continue in full force and effect, or (ii) if the estimated cost to remediate
such condition exceeds twelve ( 12) times the then monthly Base Rent or
$100,000, whichever is greater, give written notice to Lessee, within thirty
(30) days after receipt by Lessor of knowledge of the occurrence of such
Hazardous Substance Condition of Lessor's desire to terminate this Lease as
of
the date sixty (60) days following the date of such notice. In the event Lessor
elects to give a termination notice, Lessee may, within ten (10) days
thereafter, give written notice to Lessor of Lessee's commitment to pay the
amount by which the cost of the remediation of such Hazardous Substance
Condition exceeds an amount equal to twelve (12) times the monthly Base Rent
or
$100,000, whichever is greater. Lessee shall provide Lessor with said funds
or
satisfactory assurance thereof within thirty (30) days following such
commitment. In such event, this Lease shall continue in full force and effect,
and Lessor shall proceed to make such remediation, as soon as reasonably
possible after the required funds are available.
49.2
Inspection; Compliance.
Lessor
and Lessor's consultants shall have the right to enter into Premises at any
time, in the case of an emergency, and otherwise at reasonable times, for the
purpose of inspecting the condition of the Premises and for verifying compliance
by Lessee with this Lease. The cost of any such inspections shall be paid by
Lessor, unless a violation of Applicable Requirements or a contamination is
found to exist or be imminent, or the inspection is requested or ordered by
a
governmental authority. In such case, Lessee shall upon request reimburse Lessor
for the cost of such inspections, so long as such inspection is reasonably
related to the violation or contamination.
50.
SALE OF OFFICE BUILDING PROJECT.
In the
event the Office Building Project is sold to a third party during the term
of
this Lease, Lessor or Lessor’s successor-in-interest shall have the right to
terminate this Lease including any “option” as defined in Paragraph 38.1 of this
Lease. In the event Lessor elects to terminate this Lease, Lessor shall deliver
written notice of such election (the “Termination Notice”). The Termination
Notice shall specify that the Lease shall terminate not less than six (6) months
following delivery of the Termination Notice. It is agreed and understood that
the Termination Date specified in paragraph 1.5 of the Basic Lease Provisions
shall be advanced to the date specified in the Termination Notice (but in no
event less than six (6) months following delivery of such Termination
Notice).
Initials
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51.
"AS IS CONDITION."
Lessee
shall accept these Premises in their ''as is" condition, in clean and
good-working order.
52.
Lessor
must have copy of Insurance Certificate before keys will be given out for this
unit.
53.
Lessee
will have access to Fitness Center for up to six (6) employees at no
charge.
54.
Lessee
will continue to have two (2) spaces on the monument signs at no charge. Lessee
shall be responsible for any charges for sign re-lettering.
55.
All
previous leases between Airport II Property Management and Sysview Technology
are null and void as of the Commencement Date of this Lease.
56.
Lessee
is
responsible for the cost of making Lessee’s telephone, DSL and computer related
equipment, etc. lines active in Lessee’s Premises. Lessee understands that
Lessee may use Airport II vendors for this work but Lessee will be billed
directly by the vendor used. Airport II assumes no liability for this cost.
Airport II will provide data and telephone wiring as described on the floor
plan
if remodel work is part of this Lease.
57.
OFAC CERTIFICATION.
Lessee
certifies that it is not acting, directly or indirectly, for or on behalf of
any
person, group, entity, or nation named by any Executive Order or the United
States Treasury Department as a terrorist, “Specially Designated National and
Blocked Person”, or other banned or blocked person, entity, nation, or
transaction pursuant to any law, order, rule, or regulation that is enforced
or
administered by the Office of Foreign Assets Control; and it has not executed
this Lease, directly or indirectly on behalf of, or instigating or facilitating
this Lease, directly or indirectly on behalf of, any such person, group, entity,
or nation. Lessee hereby agrees to defend, indemnify, and hold harmless Lessor
from and against any and all claims, damages, losses, risks, liabilities, and
expenses (including attorney’s fees and costs) arising from or related to any
breach of the foregoing certification.
LESSEE
AND LESSOR HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
PROVISION CONTAINED HEREIN AND, BY EXECUTION OF THIS LEASE, SHOW THEIR INFORMED
AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE TIME THIS
LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE AND
EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE
PREMISES.
ATTENTION:
NO REPRESENTATION OR RECOMMENDATION IS MADE BY LESSOR AS TO THE LEGAL
SUFFICIENCY, LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS LEASE OR THE TRANSACTION
TO WHICH IT RELATES. THE LESSEE IS URGED TO:
1.
SEEK
ADVICE OF COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS
LEASE.
2
RETAIN
APPROPRIATE CONSULTANTS TO REVIEW AND INVESTIGATE THE CONDITION OF THE PREMISES.
SAID INVESTIGATION SHOULD INCLUDE BUT NOT BE LIMITED TO: THE POSSIBLE PRESENCE
OF HAZARDOUS SUBSTANCES, THE ZONING OF THE PREMISES, THE STRUCTURAL INTEGRITY,
THE CONDITION OF THE ROOF AND OPERATING SYSTEMS, AND THE SUITABILITY OF THE
PREMISES FOR LESSEE'S INTENDED USE.
| LESSOR: | LESSEE: | |||
| AIRPORT II PROPERTY MANAGEMENT | DOCUMENT CAPTURE TECHNOLOGIES INC. | |||
| By: | By: | |||
| Date: | Date: | |||
| Address: | ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇
▇▇▇
▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
|
Address: |
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
|
|
| Telephone: | (▇▇▇) ▇▇▇-▇▇▇▇ | Telephone: | (▇▇▇) ▇▇▇-▇▇▇▇ | |
| Facsimile: | (▇▇▇) ▇▇▇-▇▇▇▇ | Facsimile: | (▇▇▇) ▇▇▇-▇▇▇▇ |
Initials
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14
EXHIBIT ‘A’
RULES
AND REGULATIONS FOR
STANDARD
OFFICE LEASE
GENERAL
RULES
1.
Lessee
shall not suffer or permit the obstruction of any Common Areas, including
driveways, walkways and stairways.
2.
Lessor
reserves the right to refuse access to any persons Lessor in good faith Judges
to be a threat to the safety, reputation, or property of the Office Building
Project and its occupants.
3.
Lessee
shall not make or permit any noise or odors that annoy or interfere with other
lessee's or persons having business within the Office Building
Project.
4.
Lessee
shall not keep animals or birds within the Office Building Project, and shall
not bring bicycles, motorcycles or other vehicles into areas not designated
as
authorized for same.
5.
Lessee
shall not make, suffer or permit litter except in appropriate receptacles for
that purpose.
6.
Lessee
shall not alter any lock or install new or additional locks or
bolts.
7.
Lessee
shall be responsible for the inappropriate use of any toilet rooms, plumbing
or
other utilities. No foreign substances of any kind are to be inserted
therein.
8.
Lessee
shall not deface the walls, partitions or other surfaces of the Premises or
Office Building Project.
9.
Lessee
shall not suffer or permit any thing in or around the Premises or Building
that
causes excessive vibration or floor loading in any part of the Office Building
Project.
10.
Furniture, significant freight and equipment shall be moved into or out of
the
building only with the Lessor's knowledge and consent, and subject to such
reasonable limitations, techniques and timing, as may be designated by Lessor.
Lessee shall be responsible for any damage to the Office Building Project
arising from any such activity.
11.
Lessee shall not employ any service or contractor for services or work to be
performed in the Building, except as approved by Lessor.
12.
Lessor reserves the right to close and lock the Building on Saturdays, Sundays
and legal holidays, and on other days between the hours of 5:00 p.m. and 8:00
a.m. of the following day. If Lessee uses the Premises during such period,
Lessee shall be responsible for securely locking any doors it may have opened
for entry.
13.
Lessee shall return all keys at the termination of its tenancy and shall be
responsible for the cost of replacing any keys that are lost.
14.
No
window coverings, shades or awnings shall be installed or used by
Lessee.
15.
No
Lessee, employee or invitee shall go upon the roof of the Building.
16.
Lessee shall not suffer or permit smoking or carrying of lighted cigars or
cigarettes in areas reasonably designated by Lessor or by applicable
governmental agencies as non-smoking areas.
17.
Lessee shall not use any method of heating or air conditioning other than as
provided by Lessor.
18.
Lessee shall not install, maintain or operate any vending machines upon the
Premises without Lessor's written consent.
19.
The
premises shall not be used for lodging or manufacturing, cooking or food
preparation.
20.
Lessee shall comply with all safety, fire protection and evacuation regulations
established by Lessor or any applicable governmental agency.
21.
Lessor reserves the right to waive anyone of these rules or regulations, and/or
as to any par1icular Lessee, and any such waiver shall not constitute a waiver
of any other rule or regulation or any subsequent application thereof to such
Lessee.
22.
Lessee assumes all risks from theft or vandalism and agrees to keep its Premises
locked as may be required.
23.
Lessor reserves the right to make such other reasonable rules and regulations
as
it may from time to time deem necessary for the appropriate operation and safety
of the Office Building Project and its occupants. Lessee agrees to abide by
these and such rules and regulations.
PARKING
RULES
1.
Parking areas shall be used only for parking by vehicles no longer than full
size, passenger automobiles herein called "Permitted Size Vehicles." Vehicles
other than Permitted Size Vehicles are herein referred to as "Oversized
Vehicles."
2.
Lessee
shall not permit or allow any vehicles that belong to or are controlled by
Lessee or Lessee's employees, suppliers, shippers, customers, or invitees to
be
loaded, unloaded, or parked in areas other than those designated by Lessor
for
such activities.
3.
Parking stickers or identification devices shall be the property of Lessor
and
be returned to Lessor by the holder thereof upon termination of the holder's
parking privileges. Lessee will pay such replacement charge as is reasonably
established by Lessor for the loss of such devices.
4.
Lessor
reserves the right to refuse the sale of monthly identification devices to
any
person or entity that willfully refuses to comply with the applicable rules,
regulations, laws and/or agreements.
5.
Lessor
reserves the right to relocate all or a part of parking spaces from floor to
floor, within one floor, and/or to reasonably adjacent offsite location(s),
and
to reasonably allocate them between compact and standard size spaces, as long
as
the same complies with applicable laws, ordinances and regulations.
6.
Users
of the parking area will obey all posted signs and park only in the areas
designated for vehicle parking.
7.
Unless
otherwise instructed, every person using the parking area is required to park
and lock his own vehicle. Lessor will not be responsible for any damage to
vehicles, injury to persons or loss of property, all of which risks are assumed
by the party using the parking area.
8.
Validation, if established, will be permissible only by such method or methods
as Lessor and/or its licensee may establish at rates generally applicable to
visitor parking.
9.
The
maintenance, washing, waxing or cleaning of vehicles in the parking structure
or
Common Areas is prohibited.
10.
Lessee shall be responsible for seeing that all of its employees, agents and
invitees comply with the applicable parking rules, regulations, laws and
agreements.
11.
Lessor reserves the right to modify these rules and/or adopt such other
reasonable and non-discriminatory rules and regulations as it may deem necessary
for the proper operation of the parking area. Should it become necessary to
designate parking stalls based on Lessee's use of the parking area, Lessor
reserves the right (at Lessor's sole discretion) to designate certain parking
stalls for a particular Lessee's usage with all costs incident to such
designation payable by Lessee.
12.
Such
parking use as is herein provided is intended merely as a license only and
no
bailment is intended or shall be created hereby.
Initials
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