EXHIBIT 6.14
STANDARD INDUSTRIAL/COMMERCIAL MULTI-TENANT LEASE--GROSS
AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION
1. Basic Provisions ('Basic Provisions').
1.1 Parties: This Lease ('Lease'), dated for reference purposes only, April
28, 1998, is made by and between BRADMORE REALTY INVESTMENT COMPANY, LTD.
("Lessor") and DCH TECHNOLOGY, INC., a Colorado corporation ("Lessee"),
(collectively the "Parties", or Individually a "Party").
1.2(a) Premises: That certain portion of the Building, including all
improvements therein or to be provided by Lessor under the terms of this Lease,
commonly known by the street address of 27811 Avenue ▇▇▇▇▇▇▇, Unit 6, located in
the City of Santa Clarita, County of Los Angeles, State of California, with the
zip code 91355,as outlined on Exhibit A & B attached hereto ("Premises"). The
"Building" Is that certain building containing the Premises and generally
described as (describe briefly the nature of the Building): building 3 in a 3
building concrete tilt-up multi-tenant industrial complex known as the Bradmore
Business Center. The Premises are a Type 6 unit of approximately 3,152.8 square
feet.
In addition to Lessee's rights to use and occupy the Premises as hereinafter
specified, Lessee shall have non-exclusive rights to the Common Areas (as
defined in Paragraph 2.7 below) as hereinafter specified, but shall not have any
rights to the roof, exterior walls or utility raceways of the Building or to any
other buildings in the Industrial Center. The Premises, the Building, the Common
Areas, the land upon which they are located, along with all other buildings and
improvements thereon, are herein collectively referred to as the "Industrial
Center". (Also see Paragraph 2.)
1.2(b) Parking: six (6) total. Three (3) unreserved vehicle parking spaces
("Unreserved Parking Spaces"); and three (3) reserved vehicle parking spaces
("Reserved Parking Spaces"). (Also see Paragraph 2.6.)
1.3 Term: three(3) years and zero (O) months ("Original Term") commencing
June 1, 1998 ("Commencement Date") and ending May 31, 2001 ("Expiration Date").
(Also see Paragraph 3.)
1.4 Early Possession. Upon execution of Lease, with check for $6,150.00.
"Early Possession Date"). (Also see Paragraphs 3.2 and 3.3.)
1.5 Base Rent: $2.050.00 . per month ("Base Rent"), payable on the 1st day of
each month commencing June 1, 1998. (Also see Paragraph 4.)
If this box is checked, this Lease provides for the Base Rent to be adjusted per
Addendum 54 attached hereto.
1.6(a) Base Rent Paid Upon Execution: $2.050.00 as Base Rent for the period June
1, 1998 through June 30, 1998.
1.6(b) Lessee's Share of Common Area Operating Expenses: five point three-five
percent (5.35 %) ("Lessee's Share") as determined by prorata square footage of
the Premises as compared to the total square footage of the Industrial Center;
not to exceed $0.05/sq ft for term of lease.
1.7 Security Deposit: $4,100 00 ("Security Deposit"). (Also see Paragraph 5).
1.8 Permitted Use: Assembly of hydrogen gas sensors and offices in
connection thereof ('Permitted Use) (Also see Paragraph 6.)
1.9 Insuring Party. Lessor Is the "Insuring Party." (Also see Paragraph 8.)
1.10(a) Real Estate Brokers. The following real estate broker(s) (collectively,
the "Brokers") and brokerage relationships exist in this transaction and are
consented to by the Parties (check applicable boxes):
N/A represents Lessor exclusively ("Lessor's Broker");
N/A represents Lessee exclusively ("Lessee's Broker"); or
▇. ▇. ▇▇▇▇▇▇▇ and Associates represents both Lessor and Lessee ("Dual Agency").
(Also see Paragraph 15.)
1.10(b) Payment to Brokers. Upon the execution of this Lease by both Parties,
Lessor shall pay to said Broker(s) jointly, or in such separate shares as they
may mutually designate in writing, a fee as set forth in a separate written
agreement between Lessor and said Broker(s) (or in the event there is no
separate written agreement between Lessor and said Broker(s), the sum of N/A for
Brokerage services rendered by said Broker(s) in connection with this
transaction.
1.11 Guarantor. The obligations of the Lessee under this Lease are to be
guaranteed by N/A ("Guarantor"). (Also see Paragraph 37.)
1.12 Addenda and Exhibits. Attached hereto is an Addendum or Addenda
consisting of Paragraphs 49 through 58 and Exhibits "A" through "C" , all of
which constitute a part of this Lease.
2. Premises, Parking and Common Areas.
2.1 Letting. Lessor hereby leases to Lessee, and Lessee hereby leases from
Lessor, the Premises, for the term, at the rental, and upon all of the terms,
covenants and conditions set forth in this Lease. Unless otherwise provided
herein, any statement of square footage set forth in this Lease, or that may
have been used in calculating rental and/or Common Area Operating Expenses, is
an approximation which Lessor and Lessee agree is reasonable and the rental and
Lessee's Share (as defined in Paragraph 1.6(b)) based thereon is not subject to
revision whether or not the actual square footage Is more or less.
2.2 Condition. Lessor shall deliver the Premises to Lessee clean and free of
debris on the Commencement Date and warrants to Lessee that the existing
plumbing, electrical systems, fire sprinkler system, lighting, air conditioning
and heating systems and loading doors, if any, in the Premises, other than those
constructed by Lessee, shall be in good operating condition on the Commencement
Date. It a non-compliance with said warranty exists as of the Commencement Date,
Lessor shall, except as otherwise provided in this Lease, promptly after receipt
of written notice from Lessee setting forth with specificity the nature and
extent of such non-compliance, rectify same at Lessor's expense. If Lessee does
not give Lessor written notice of a non-compliance with this warranty within
thirty (30) days after the Commencement Date, correction of that non-compliance
shall be the obligation of Lessee at Lessee's sole cost and expense.
2.3 Compliance with Covenants, Restrictions and Building Code. Lessor
warrants that any improvements (other than those constructed by Lessee or at
Lessee's direction) on or in the Premises which have been constructed or
installed by Lessor or with Lessor's consent or at Lessor's direction shall
comply with all applicable covenants or restrictions of record and applicable
building codes, regulations and ordinances in effect on the Commencement Date.
Lessor further warrants to Lessee that Lessor has no knowledge of any claim
having been made by any governmental agency that a violation or violations of
applicable building codes, regulations, or ordinances exist with regard to the
Premises as of the Commencement Date. Said warranties shall not apply to any
Alterations or Utility Installations (defined in Paragraph 7.3(a)) made or to be
made by Lessee. If the Premises do not comply with said warranties, Lessor
shall, except as otherwise provided in this Lease, promptly after receipt of
written notice from Lessee given within six (6) months following the
Commencement Date and setting forth with specificity the nature and extent of
such non-compliance, take such action, at Lessor's expense, as may be reasonable
or appropriate to rectify the non-compliance. Lessor makes no warranty that the
Permitted Use in Paragraph 1.8 is permitted for the Premises under Applicable
Laws @as defined in Paragraph 2.4).
2.4 Acceptance of Premises. Lessee hereby acknowledges: (a) that it has been
advised by the Broker(s) to satisfy itself with respect to the condition of the
Premises (including but not limited to the electrical and fire sprinkler
systems, security, environmental aspects, seismic and earthquake requirements,
and compliance with the Americans with Disabilities Act and applicable zoning,
municipal, county, state and federal laws, ordinances and regulations and any
covenants or restrictions of record (collectively, "Applicable Laws" and the
present and future suitability of the Premises for Lessee's intended use; (b)
that Lessee has made such investigation as it deems necessary with reference to
such matters, is satisfied with reference thereto, and assumes all
responsibility therefore as the same relate to Lessee's occupancy of the
Premises and/or the terms of this Lease; and (c) that neither Lessor, nor any of
Lessor's agents, has made any oral or written representations or warranties with
respect to said matters other than as set forth in this Lease.
2.5 Lessee as Prior Owner/Occupant. The warranties made by Lessor in this
Paragraph 2 shall be of no force or effect if immediately prior to the date set
forth in Paragraph 1.1 Lessee was the owner or occupant of the Premises. In such
event, Lessee shall, at Lessee's sole cost and expense, correct any non-
compliance of the Premises with said warranties.
2.6 Vehicle Parking. Lessee shall be entitled to use the number of Unreserved
Parking Spaces and Reserved Parking Spaces specified in Paragraph 1.2(b) on
those portions of the Common Areas designated from time to time by Lessor for
parking. Lessee shall not use more parking spaces than said number. Said
parking spaces shall be used for parking by vehicles no larger than full-size
passenger automobiles or pick-up trucks, herein called "Permitted Size
Vehicles." Vehicles other than Permitted Size Vehicles shall be parked and
loaded or unloaded as directed by Lessor in the Rules and Regulations (as
defined in Paragraph 40) issued by Lessor. (Also see Paragraph 2.9.)
(a) Lessee shall not permit or allow any vehicles that belong to or are
controlled by Lessee or Lessee's employees, suppliers, shippers, customers,
contractors or invitees to be loaded, unloaded, or parked in areas other than
those designated by Lessor for such activities.
(b) If Lessee permits or allows any of the prohibited activities described in
this Paragraph 2.6, 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.
(c) Lessor shall at the Commencement Date of this Lease, provide the parking
facilities required by Applicable Law.
2.7 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
Industrial Center and interior utility raceways within the Premises that are
provided and designated by the Lessor from time to time for the general non-
exclusive use of Lessor, Lessee and other lessees of the Industrial Center and
their respective employees, suppliers, shippers, customers, contractors and
invitees, including parking areas, loading and unloading areas, trash areas,
roadways, sidewalks, walkways, parkways, driveways and landscaped areas.
2.8 Common Areas--Lessee's Rights. Lessor hereby grants to Lessee, for the
benefit of Lessee and its employees, suppliers, shippers, contractors, customers
and invitees, during the term of this Lease, the non-exclusive right to use, in
common with others entitled to such use, the Common Areas as they exist from
time to time, subject to any rights, powers, and privileges reserved by Lessor
under the terms hereof or under the terms of any rules and regulations or
restrictions governing the use of the Industrial Center. Under no circumstances
shall the right herein granted to use the Common Areas be deemed to include the
right to store any property, temporarily or permanently, in the Common Areas.
Any such storage shall be permitted only by the prior written consent of Lessor
or Lessor's designated agent, which consent may be revoked at any time. In the
event that any unauthorized storage shall occur then Lessor shall have the
right, without notice, in addition to such other rights and remedies that it may
have, to remove the property and charge the cost to Lessee, which cost shall be
immediately payable upon demand by Lessor.
2.9 Common Areas--Rules and Regulations. 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 establish, modify, amend
and enforce reasonable Rules and Regulations with respect thereto in accordance
with Paragraph 40. Lessee agrees to abide by and conform to all such Rules and
Regulations, and to cause its employees, suppliers, shippers, customers,
contractors and invitees to so abide and conform. Lessor shall not be
responsible to Lessee for the non-compliance with said rules and regulations by
other lessees of the Industrial Center.
2.10 Common Areas--Changes. Lessor shall have the right, in Lessor's sole
discretion, from time to time:
(a) To make changes to the Common Areas, including, without limitation, changes
in the location, size, shape and number of driveways, entrances, parking spaces,
parking areas, loading and unloading areas, ingress, egress, direction of
traffic, landscaped areas, walkways and utility raceways;
(b) To close temporarily any of the Common Areas for maintenance purposes so
long as reasonable access to the Premises remains available;
(c) To designate other land outside the boundaries of the Industrial Center to
be a part of the Common Areas;
(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 Industrial Center, or any portion thereof; and
(f) To do and perform such other acts and make such other changes in, to or with
respect to the Common Areas and Industrial Center as Lessor may, in the exercise
of sound business judgment, deem to be appropriate.
3. Term.
3.1 Term. The Commencement Date, Expiration Date and Original Term of this Lease
are as specified in Paragraph 1.3.
3.2 Early Possession. If an Early Possession Date is specified in Paragraph 1.4
and if Lessee totally or partially occupies the Premises after the Early
Possession Date but prior to the Commencement Date, the obligation to pay Base
Rent shall be abated for the period of such early occupancy. All other terms of
this Lease, however, (including but not limited to the obligations to pay
Lessee's Share of Common Area Operating Expenses and to carry the insurance
required by Paragraph 8) shall be in effect during such period. Any such early
possession shall not affect nor advance the Expiration Date of the Original
Term.
3.3 Delay In Possession. If for any reason Lessor cannot deliver possession of
the Premises to Lasses-, by the Early Possession Date, if one is specified it
Paragraph 1.4, or it no Early Possession Date is specified, by the Commencement
Date, Lessor shall not be subject to any liability therefor, nor shall such
failure affect the validity of this Lease, or the obligations of Lessee
hereunder, or extend the term hereof, but in such case, Lessee shall not, except
as otherwise provided herein, be obligated to pay rent or perform any other
obligation of Lessee under the terms of this Lease until Lessor delivers
possession of the Premises to Lessee. If possession of the Premises is not
delivered to Lessee within sixty (60) days after the Commencement Date, Lessee
may, at its option, by notice in writing to Lessor within ten (10) days after
the end of said sixty (60) day period, cancel this Lease, in which event the
parties shall be discharged from all obligations hereunder; provided further,
however, that if such written notice of 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 or effect. Except as may be otherwise
provided, and regardless of when the Original Term actually commences, if
possession is not tendered to Lessee when required by this Lease and Lessee does
not terminate this Lease, as aforesaid, the period free of the obligation to pay
Base Rent, if any, that Lessee would otherwise have enjoyed shall run from the
date of delivery of possession and continue for a period equal to the period
during which the Lessee would have otherwise enjoyed under the terms hereof, but
minus any days of delay caused by the acts, changes or omissions of
Lessee.
4. Rent.
4.1 Base Rent. Lessee shall pay Base Rent and other rent or charges, as the same
may be adjusted from time to time, to Lessor in lawful money of the United
States, without offset or deduction, on or before the day on which it is due
under the terms of this Lease. Base Rent and all other rent and charges for any
period during the term hereof which is for less than, one full month shall be
prorated based upon the actual number of days of the month involved. Payment of
Base Rent and other charges shall be made to Lessor at its address stated herein
or to such other persons or at such other addresses as Lessor may from time to
time designate in writing to Lessee.
4.2 Common Area Operating Expenses. Lessee shall pay to Lessor during the
term hereof, in addition to the Base Rent, Lessee's Share (as specified in
Paragraph 1.6(b)) of all Common Area Operating Expenses, as hereinafter defined,
during each calendar year of the term of this Lease, in accordance with the
following provisions:
(a) "Common Area Operating Expenses" are defined, for purposes of this Lease,
as all costs incurred by Lessor relating to the ownership and operation of the
Industrial Center, including, but not limited to, the following:
(i) The operation, repair and maintenance, in neat, clean, good order and
condition, of the following:
(aa) The Common Areas, including parking areas, loading and unloading areas,
trash areas, roadways, sidewalks, walkways, parkways, drive- ways, landscaped
areas, striping, bumpers, irrigation systems, Common Area lighting facilities,
fences and gates, elevators and root.
(bb) Exterior signs and any tenant directories.
(cc) Fire detection and sprinkler systems.
(ii) The cost of water, gas, electricity and telephone to service the Common
Areas.
(iii) Trash disposal, property management and security services and the costs
of any environmental inspections.
(iv) Reserves set aside for maintenance and repair of Common Areas.
(v) Any increase above the Base Rent Property Taxes, (as defined in Paragraph
10.2(b)) for the Building and the Common Areas. Per proposition 13, not due to
increase in assessment because of change of ownership.
(vii) The cost of insurance carried by Lessor with respect to the Common Areas.
(viii) Any deductible portion of an insured loss concerning the Building or the
Common Areas.
(ix) Any other services to be provided by Lessor That are stated elsewhere in
this Lease to be a Common Area Operating Expense.
(b) Any Common Area Operating Expenses and Real Property Taxes that are
specifically attributable to the Building or to any other building in the
Industrial Center or to the operation, repair and maintenance thereof, shall be
allocated entirely to the Building or to such other building. However, any
Common Area Operating Expenses and Real Property Taxes that are not specifically
attributable to the Building or to any other building or to the operation,
repair and maintenance thereof, shall be equitably allocated by Lessor to all
buildings in the Industrial Center.
(c) The inclusion of the improvements, facilities and services set forth in
Subparagraph 4.2(a) shall not be deemed to impose an obligation upon Lessor to
either have said improvements or facilities or to provide those services unless
the Industrial Center already has the same, Lessor already provides the
services, or Lessor has agreed elsewhere in this Lease In provide the same or
some of them.
(d) Lessee's Share of Common Area Operating Expenses shall be payable by Lessee
within ten (10) days after a reasonably detailed statement of actual expenses is
presented to Lessee by Lessor. At, Lessor's option, however, an amount may be
estimated by Lessor from time to time of Lessee's Share of annual Common Area
Operating Expenses and the same shall be payable monthly or quarterly, as Lessor
shall designate, during each 12-month period of the Lease term, on the same day
as the Base Rent is due hereunder. Lessor shall deliver to Lessee within sixty
(60) days attar the expiration of each calendar year a reasonably detailed
statement showing Lessee's Share of the actual Common Area Operating Expenses
incurred during the preceding year. If Lessee's payments under this Paragraph
4.2(d) during said preceding year exceed Lessee's Share as indicated on said
statement, Lessee shall be credited the amount of such over payment against
Lessee's Share of Common Area Operating Expenses next becoming due. If Lessee's
payments under this Paragraph 4.2(d) during said preceding year were less than
Lessee's Share as indicated on said statement, Lessee shall pay to Lessor the
amount of the deficiency within ten (10) days after delivery by Lessor to Lessee
of said statement.
5. Security Deposit. Lessee shall deposit with Lessor upon Lessee's execution
hereof the Security Deposit set forth in Paragraph 1.7 as security for Lessee's
faithful performance of Lessee's obligations under this Lease. If Lessee fails
to pay Base Rent or other rent or charges due hereunder, or otherwise Defaults
under this Lease (as defined in Paragraph 13.1), Lessor may use, apply or retain
all or any portion of said Security Deposit for the payment of any amount due
Lessor or to reimburse or compensate Lessor for any liability, cost, expense,
loss or damage (including attorneys' fees) which Lessor may suffer or incur by
reason thereof. It Lessor uses or applies all or any portion of said Security
Deposit, Lessee shall within ten (10) days after written request therefore
deposit monies with Lessor sufficient to restore said Security Deposit to the
full amount required by this Lease. Any time the Base Rent increases during the
term of this Lease, Lessee shall, upon written request from Lessor, deposit
additional monies with Lessor as an addition to the Security Deposit so that the
total amount of the Security Deposit shall at all times bear the same proportion
to the then current Base Rent as the initial Security Deposit bears to the
initial Base Rent set forth in Paragraph 1.5. Lessor shall not be required to
keep all or any part of the Security Deposit separate from its general accounts.
Lessor shall, at the expiration or earlier termination of the term hereof and
after Lessee has vacated the Premises, return to Lessee (or, at Lessor's option,
to the last assignee, if any, of Lessee's interest herein), that portion of the
Security Deposit not used or applied by Lessor. Unless otherwise expressly
agreed in writing by Lessor, no part of the Security Deposit shall be considered
to be held in trust, to bear interest or other increment for its use, or to be
prepayment for any monies to be paid by Lessee under this Lease.
6. Use.
6.1 Permitted Use.
(a) Lessee shall use and occupy the Premises only for the Permitted Use set
forth in Paragraph 1.8, 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 waste or a nuisance, or that
disturbs owners and/or occupants of, or causes damage to the Premises or
neighboring premises or properties.
(b) Lessor hereby agrees to not unreasonably withhold or delay its consent to
any written request by Lessee, Lessee's assignees or subtenants, and by
prospective assignees and subtenants of Lessee, its assignees and subtenants,
for a modification of said Permitted Use, so long as the same will not impair
the structural integrity of the improvements on the Premises or in the Building
or the mechanical or electrical systems therein, does not conflict with uses by
other lessees, is not significantly more burdensome to the Premises or the
Building and the improvements thereon, and is otherwise permissible pursuant to
this Paragraph 6. If Lessor elects to withhold such consent, Lessor shall within
five (5) business days after such request give a written notification of same,
which notice shall include an explanation of Lessor's reasonable objections to
the change in use.
6.2 Hazardous Substances.
(a) Reportable Uses Require Consent. The term "Hazardous Substance" as used in
this Lease shall mean any product, substance, chemical, material or waste whose
presence, nature, quantity and/or intensity of existence, use, manufacture,
disposal, transportation, spill, release or effect, 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
Substance shall include, but not be limited to, hydrocarbons, petroleum,
gasoline, crude oil or any products or by-products thereof. Lessee shall not
engage in any activity in or about the Premises which constitutes a Reportable
Use (as hereinafter defined) of Hazardous Substances without the express prior
written consent of Lessor and compliance in a timely manner (at Lessee's sole
cost and expense) with all Applicable Requirements (as defined in Paragraph
6.3). "Reportable Use" shall mean (1) 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 (iii) the presence
in, on or about the Premises of a Hazardous Substance with respect to which any
Applicable Laws require that a notice be given to persons entering or occupying
the Premises or neighboring properties. Notwithstanding the foregoing, Lessee
may, without Lessor's prior consent, but upon notice to Lessor and in compliance
with all Applicable Requirements, use any ordinary and customary materials
reasonably required to be used by Lessee in the normal course of the Permitted
Use, so long as such use is not a Reportable Use and does not expose the
Premises or neighboring properties to any meaningful risk of contamination or
damage or expose Lessor to any liability therefor. In addition, Lessor may (but
without any obligation to do so) condition its consent to any Reportable Use of
any Hazardous Substance by Lessee upon Lessee's giving Lessor such additional
assurances as Lessor, in its reasonable discretion, deems necessary to protect
itself, the public, the Premises and the environment against damage,
contamination or injury and/or liability therefor, including but not limited to
the installation (and, at Lessor's option, removal on or before Lease expiration
or earlier termination) of reasonably necessary protective modifications to the
Premises (such as concrete encasements) and/or the deposit of an additional
Security Deposit under Paragraph 5 hereof.
(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 or the Building, other than as previously consented to by Lessor,
Lessee shall immediately give Lessor written notice thereof, together with a
copy of any statement, report, notice, registration, application, permit,
business plan, license, claim, action, or proceeding given to, or received from,
any govern- mental authority or private party concerning the presence, spill,
release, discharge of, or exposure to, such Hazardous Substance including but
not limited to all such documents as may be involved in any Reportable Use
involving the Premises. Lessee shall not cause or permit any Hazardous Substance
to be spilled or released in, on, under or about the Premises (including,
without limitation, through the plumbing or sanitary sewer system).
(c) Indemnification. Lessee shall indemnify, protect, defend and hold Lessor,
its agents, employees, lenders and ground lessor, it any, and the Premises,
harmless from and against any and all damages, liabilities, judgments, costs,
claims, liens, expenses, penalties, loss of permits and attorneys' and
consultants' fees arising out of or involving any Hazardous Substance brought
onto the Premises by or for Lessee or by anyone under Lessee's control. Lessee's
obligations under this Paragraph 6.2(c) 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
(including consultants' and attorneys' fees and testing), removal, remediation,
restoration and/or abatement thereof, or of any contamination therein involved,
and shall survive the expiration or earlier 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.
6.3 Lessee's Compliance with Requirements. Lessee shall, at Lessee's sole
cost and expense, fully, diligently and in a timely manner, comply with all
"Applicable Requirements," which term is used in this Lease to mean all laws,
rules, regulations, ordinances, directives, covenants, easements and
restrictions of record, permits, the requirements of any applicable fire
insurance underwriter or rating bureau, and the recommendations of Lessors'
engineers and/or consultants, relating in any manner to the Premises (including
but not limited to matters pertaining to (I) industrial hygiene, (II)
environmental conditions on, in, under or about the Premises, including soil and
groundwater conditions, and (iii) the use, generation, manufacture, production,
installation, maintenance, removal, transportation, storage, spill, or release
of any Hazardous Substance), now in effect or which may hereafter come into
effect. Lessee shall, within five (5) days after receipt of Lessor's written
request, provide Lessor with copies of all documents and information, including
but not limited to permits, registrations, manifests, applications, reports and
certificates, evidencing Lessee's compliance with any Applicable Requirements
specified by Lessor, and shall immediately upon receipt, notify Lessor in
writing (with copies of any documents involved) of any threatened or actual
claim, notice, citation, warning, complaint or report pertaining to or involving
failure by Lessee or the Premises to comply with any Applicable Requirements.
6.4 Inspection; Compliance with Law. Lessor, Lessor's agents, employees,
contractors and designated representatives, and the holders of any mortgages,
deeds of trust or ground leases on the Premises ("Lenders") shall have the right
to enter the Premises at any time in the case of an emergency, and other- wise
at reasonable times, for the purpose of inspecting the condition of the Premises
and for verifying compliance by Lessee with this Lease and all Applicable
Requirements (as defined in Paragraph 6.3), and Lessor shall be entitled to
employ experts and/or consultants in connection therewith to advise Lessor with
respect to Lessee's activities, including but not limited to Lessee's
installation, operation, use, monitoring, maintenance or removal of any
Hazardous Substance on or from the Premises. The costs and expenses of any such
inspections shall be paid by the party requesting same, unless a Default or
Breach of this Lease by Lessee or a violation of Applicable Requirements or a
contamination, caused or materially contributed to by Lessee, is found to exist
or to be imminent, or unless the inspection is requested or ordered by a
governmental authority as the result of any such existing or imminent violation
or contamination. In such case, Lessee shall upon request reimburse Lessor or
Lessor's Lender, as the case may be, for the costs and expenses of such
inspections.
7. Maintenance, Repairs, Utility Installations, Trade Fixtures and
Alterations.
7.1 Lessee's Obligations.
(a) Subject to the provisions of Paragraphs 2.2 (Condition), 2.3 (Compliance
with Covenants, Restrictions and Building Code), 7.2 (Lessor's Obligations), 9
(Damage or Destruction), and 14 (Condemnation), Lessee shall, at Lessee's sole
cost and expense and at all times, keep the Premises and every part thereof in
good order, condition and repair (whether or not such portion of the Premises
requiring repair, or the means of repairing the same, are reasonably or readily
accessible to Lessee, and whether or not the need for such repairs occurs as a
result of Lessee's use, any prior use, the elements or the age of such portion
of the Premises), including, without limiting the generality of the foregoing,
all equipment or facilities specifically serving the Premises, such as plumbing,
heating, air conditioning, ventilating, electrical, lighting facilities,
boilers, fired or unfired pressure vessels, fire hose connections if within the
Premises, fixtures, interior walls, interior surfaces of exterior walls,
ceilings, floors, windows, doors, plate glass, and skylights, but excluding any
items which are the responsibility of Lessor pursuant to Paragraph 7.2 below.
Lessee, in keeping the Premises in good order, condition and repair, shall
exercise and perform good maintenance practices. Lessee's obligations shall
include restorations, replacements or renewals when necessary to keep the
Premises and all improvement's thereon or a part thereof in good order,
condition and state of repair.
(b) Lessee shall, at Lessee's sole cost and expense, procure and maintain a
contract, with copies to Lessor, in customary form and substance for and with a
contractor specializing and experienced in the inspection, maintenance and
service of the heating, air conditioning and ventilation system for the
Premises. However, Lessor reserves the right, upon notice to Lessee, to procure
and maintain the contract for the heating, air conditioning and ventilating
systems, and if Lessor so elects, Lessee shall reimburse Lessor, upon demand,
for the cost thereof.
(c) If Lessee fails to perform Lessee's obligations under this Paragraph,7.l,
Lessor may enter upon the Premises after ten (10) days' prior written notice to
Lessee (except in the case of an emergency, in which case n6 notice shall be
required), perform such obligations on Lessee's behalf, and put the Premises in
good order, condition and repair, in accordance with Paragraph 13.2 below.
7.2 Lessor's Obligations. Subject to the provisions of Paragraphs 2.2
(Condition), 2.3 (Compliance with Covenants, Restrictions and Building Code),
4.2 (Common Area Operating Expenses), 6 (Use), 7.1 (Lessee's Obligations),-.,9
(Damage or Destruction) and 14 (Condemnation), Lessor, subject to reimbursement
pursuant to Paragraph 4.2, shall keep in good order, condition and repair the
foundations, exterior walls, structural condition of interior bearing walls,
exterior roof, fire sprinkler and/or standpipe and hose (if located in the
Common Areas) or other automatic fire extinguishing system including fire alarm
and/or smoke detection systems and equipment, fire hydrants, parking lots,
walkways, parkways, driveways, landscaping, fences, signs and utility systems
serving the Common Areas and all parts thereof, as well as providing the
services for which there is a Common Area Operating Expense pursuant to
Paragraph 4.2. Lessor shall not be obligated to paint the exterior or interior
surfaces of exterior walls nor shall Lessor be obligated to maintain, repair or
replace windows, doors or plate glass of the Premises. Lessee expressly waives
the benefit of any statute nova 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 Building, Industrial Center or
Common Areas in good order, condition and repair.
7.3 Utility Installations, Trade Fixtures, Alterations.
(a) Definitions; Consent Required. The term "Utility Installations" is used in
this Lease to refer to all air lines, power panels, electrical distribution,
security, fire protection systems, communications systems, lighting fixtures,
heating, ventilating and air conditioning equipment, plumbing, and fencing in,
on or about the Premises. The term "Trade Fixtures" shall mean Lessee's
machinery and equipment which can be removed without doing material damage to
the Premises. The term "Alterations" shall mean any modification of the
improvements on the Premises which are provided by Lessor under the terms of
this Lease, other there Utility installations or Trade Fixtures. "Lessee-Owned
Alterations and/or Utility Installations" are defined as Alterations and/or
Utility Installations made by Lessee that are not yet owned by Lessor pursuant
to Paragraph 7.4(a). Lessee shall not make nor cause to be made any Alterations
or Utility Installations in, on, under or about the Premises without Lessor's
prior written consent. Lessee -nay, however. make non-structural Utility
Installations to the interior of the Premises (excluding the roof) without
Lessor's consent but upon notice to Lessor, so long as they are not visible from
the outside of the Premises, do not involve puncturing, relocating or removing
the roof or any existing walls, or changing or interfering with the fire
sprinkler or fire detection systems and the cumulative cost thereof during the
term of this Lease as extended does not exceed $2,500.00.
(b) Consent. Any Alterations or Utility Installations that Lessee shall desire
to make and which require the consent of the Lessor shall be presented to Lessor
in written form with detailed plans. All consents given by Lessor, whether by
virtue of Paragraph 7.3(a) or by subsequent specific consent, shall be deemed
conditioned upon: (i) Lessee's acquiring all applicable permits required by
governmental authorities; (ii) the furnishing of copies of such permits together
with a copy of the plans and specifications for the Alteration or Utility
Installation to Lessor prior to commencement of the work thereon; and (iii) the
compliance by Lessee with all conditions of said permits in a prompt and
expeditious manner. Any Alterations or Utility Installations by Lessee during
the term of this Lease shall be done in a good and workmanlike manner, with good
and sufficient materials, and be in compliance with all Applicable Requirements.
Lessee shall promptly upon completion thereof furnish Lessor with as-built plans
and specifications therefor. Lessor may, (but without obligation to do so)
condition its consent to any requested Alteration or Utility Installation that
costs $2,500.00 or more open Lessee's providing Lessor with a lien and
completion bond in an amount equal to one and one-half times the estimated cost
of such Alteration or Utility Installation.
(e) Lien Protection. Lessee shall pay when due all claims for labor or materials
furnished or alleged to have been furnished to or for Lessee at or for use on
the Premises, which claims are or may be secured by any mechanic's or
materialmen's lien against the Premises or any interest therein. Lessee shall
give Lessor not less than ten (10) days' notice prior to the commencement of any
work in, on, or about the Premises, and Lessor shall have the right to post
notices of non-responsibility in or on the Premises as provided by law. If
Lessee shall, in good faith, contest the validity of any such lien, claim or
demand, then Lessee shall, at its sole expense, defend and protect itself,
Lessor and the Premises 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. If Lessor shall require, Lessee shall
furnish to Lessor a surety bond satisfactory to Lessor in an amount equal to one
and one-half times the amount of such contested lien claim or demand,
indemnifying Lessor against liability for the same, as required by law for the
holding of the Premises free from the effect of such lien or claim. In addition,
Lessor may require Lessee to pay Lessor's attorneys' fees and costs in
participating in such action if Lessor shall decide it is to its best interest
to do so.
7.4 Ownership, Removal, Surrender, and Restoration.
(a) Ownership. Subject to Lessor's right to require their removal and to cause
Lessee to become the owner thereof as hereinafter provided in this Paragraph
7.4, all Alterations and Utility Installations made to the Premises by Lessee
shall be the property of and owned by Lessee, but considered a part of the
Premises. Lessor may, at any time and at its option, elect in writing to Lessee
to be the owner of all or any specified part of the Lessee-Owned Alterations and
Utility Installations. Unless otherwise instructed per Subparagraph 7.4(b)
hereof, all Lessee-Owned Alterations and Utility Installations shall, at the
expiration or earlier termination of this Lease, become the proper' y of Lessor
and remain upon the Premises and be surrendered with the Premises by Lessee.
(b) Removal. Unless otherwise agreed in writing, Lessor may require that any or
all Lessee-Owned Alterations or Utility Installations be removed by the
expiration or earlier termination of this Lease, notwithstanding that their
installation may have been consented to by Lessor. Lessor may require the
removal at any time of all or any part of any Alterations or Utility
Installations made without the required consent of Lessor.
(c) Surrender/Restoration. Lessee shall surrender the Premises by the end of the
last day of the Lease term or any earlier termination date, clean and free of
debris and in good operating order, condition and state of repair, ordinary wear
and tear excepted. Ordinary wear and tear shall not include any dam- age or
deterioration that would have been prevented by good maintenance practice or by
Lessee performing all of its obligations under this Lease. Except as otherwise
agreed or specified herein, the Premises, as surrendered, shall include the
Alterations and Utility Installations. The obligation of Lessee shall include
the repair of any damage occasioned by the installation, maintenance or removal
of Lessee's Trade Fixtures, furnishings, equipment, and Lessee-Owned Alterations
and Utility Installations, as well as the removal of any storage tank installed
by or for Lessee, and the removal, replacement, or remediation of any soil,
material or ground water contaminated by Lessee, all as may then be required by
Applicable Requirements and/or good practice. Lessee's Trade Fixtures shall
remain the property of Lessee and shall be removed by Lessee subject to its
obligation to repair and restore the Premises per this Lease.
8. Insurance; Indemnity.
8.1 Payment of Premium Increases.
(a) As used herein, the term "Insurance Cost Increase" is defined as any
increase in the actual cost of the insurance applicable to the Building and
required to be carried oy Lessor pursuant to Paragraphs 8.2(b), 8.3(a) and
8.3(b), ("Required Insurance"), over and above the Base Premium, as hereinafter
defined, calculated on an annual basis. "Insurance Cost Increase" shall include,
but not be limited to, requirements of the holder of a mortgage or deed of trust
covering the Premises, increased valuation of the Premises, and/or a general
premium rate increase. The term "Insurance Cost Increase" shall not, however,
include any premium increases resulting from the nature of the occupancy of any
other lessee of the Building. It the parties insert a dollar amount in Paragraph
1.9, such amount shall be considered the "Base Premium." 1f a dollar amount has
not been inserted in Paragraph 1.9 and if the Building has been previously
occupied during the twelve (1 2) month period immediately preceding the
Commencement Date, the "Base Premium" shall be the annual premium applicable to
such twelve (12) month period. It the Building was not fully occupied during
such twelve (12) month period, the "Base Premium" shall be the lowest annual
premium reasonably obtainable for the Required Insurance as of the Commencement
Date, assuming the most nominal use possible of the Building. In no event,
however, shall Lessee be responsible for any portion of the premium cost
attributable to liability insurance coverage in excess of $1,000,000 procured
under Paragraph 8.2(b).
(b) Lessee shall pay any Insurance Cost Increase to Lessor pursuant to Paragraph
4.2. Premiums for policy periods commencing prior to, or extending beyond, the
term of this Lease shall be prorated to coincide with the corresponding
Commencement Date or Expiration Date.
8.2 Liability Insurance.
(a) Carried by Lessee. Lessee shall obtain and keep in force during the term of
this Lease a Commercial General Liability policy of insurance protecting Lessee,
Lessor and any Lender(s) whose names have been provided to Lessee in writing (as
additional insureds) against claims for bodily injury, personal injury and
property damage based upon, involving or arising out of the ownership, use,
occupancy or maintenance of the Premises and all areas appurtenant thereto. Such
insurance shall be on an occurrence basis providing single limit coverage in an
amount not less than $1,000,000 per occurrence with an "Additional Insured-
Managers or 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 intra-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
required by this Lease or as carried by Lessee shall not, however, limit the
liability of Lessee nor relieve Lessee of any obligation hereunder. All
insurance to be 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. Lessor shall also maintain liability insurance described
in Paragraph 8.2(a) above, in addition to and not in lieu of, the insurance
required to be maintained by Lessee. Lessee shall not be named as an additional
insured therein.
8.3 Insurance-Building, Improvements and Rental Value.
(a) Building and Improvements. Lessor shall obtain and keep in force during the
term of this Lease a policy or policies in the name of Lessor, with loss payable
to Lessor and to any Lender(s), insuring against loss or damage to the Premises.
Such insurance shall be for full replacement cost, as the same shall exist from
time to time, or the amount required by any Lender(s), but in no event more than
the commercially reasonable and available insurable value thereof if, by reason
of the unique nature or age of the improvements involved, such latter amount is
less than full replacement cost. Lessee-Owned Alterations and Utility
Installations, Trade Fixtures and Lessee's personal property shall be insured by
Lessee pursuant to Paragraph 8.4. If 'he coverage is available and commercially
appropriate, Lessor's policy or policies shall insure against at; risks of
direct physical loss or damage (except the perils of flood and/or earthquake
unless required by a Lender or included in the Base Premium), including coverage
for any additional costs resulting from debris removal and reasonable amounts of
coverage for the enforcement of any ordinance or law regulating the
reconstruction or replacement of any undamaged sections of the Building required
to be demolished or removed by reason of the enforcement of any building,
zoning, safety or land use laws as the result of a covered loss, but not
including plate glass insurance. Said policy or policies shall also contain an
agreed valuation provision in lieu of any co-insurance clause, waiver of
subrogation, and inflation guard protection causing an increase in the annual
property insurance coverage amount by a factor of not less than the adjusted
LJ.S. Department of Labor Consumer Price Index for All Urban Consumers for the
city nearest to where the Premises are located.
(b) Rental Value. Lessor shall also obtain and keep in force during the term of
this Lease a policy or policies in the name of Lessor, with loss payable to
Lessor and any Lender(s), insuring the loss of the full rental and other charges
payable by all lessees of the Building to Lessor for one year (including all
Real Property Taxes, insurance costs, all Common Area Operating Expenses and any
scheduled rental increases). Said insurance may provide that in the event the
Lease is terminated by reason of an insured loss, the period of indemnity for
such coverage shall be extended beyond the date of the completion of repairs or
replacement of the Premises, to provide for one full year's loss of rental
revenues from the date of any such loss. Said insurance shall contain an agreed
valuation provision in lieu of any co-insurance clause, and the amount of
coverage shall be adjusted annually to reflect the projected rental income, Real
Property Taxes, insurance premium costs and other expenses, it any, otherwise
payable, for the next 12-month period. Common Area Operating Expenses shall
include any deductible amount in the event of such loss.
(c) Adjacent Premises. Lessee shall pay for any increase in the premiums for the
property insurance of the Building and for the Common Areas or other buildings
in the Industrial Center if said increase is caused by Lessee's acts, omissions,
use or occupancy of the Premises.
(d) Lessee's Improvements. Since Lessor is the Insuring Party, Lessor shall not
be required to insure Lessee-Owned Alterations and Utility Installations unless
the item in question has become the property of Lessor under the terms of this
Lease.
8.4 Lessee's Property Insurance. Subject to the requirements of Paragraph 8.5,
Lessee at its cost shall either by separate policy or, at Lessor's option, by
endorsement to a policy already carried, maintain insurance coverage on all of
Lessee's personal property, Trade Fixtures and Lessee-Owned Alterations and
Utility Installations in, on, or about the Premises similar in coverage to that
carried by Lessor as the Insuring Party under Paragraph 8.3(a). Such insurance
shall be full replacement cost coverage with a deductible not to exceed $1,000
per occurrence. The proceeds from any such insurance shall be used by Lessee for
the replacement of personal property and the restoration of Trade Fixtures and
Lessee-Owned Alterations and Utility Installations. Upon request from Lessor,
Lessee shall provide Lessor with written evidence that such insurance is in
force.
8.5 Insurance Policies. Insurance required hereunder shall be in companies duly
licensed to transact business in the state where the Premises are located, and
maintaining during the policy term a 'General Policyholders Rating' of at least
B+, V, or such other rating as may be required by a Lender, as set forth in the
most current issue of 'Best's Insurance Guide.' Lessee shall not do or permit to
be done anything which shall invalidate the insurance policies referred to in
this Paragraph 8. Lessee shall cause to be delivered to Lessor, within seven
(7) days after the Early Possession Date-or the Commencement Date, certified
copies of, or certificates evidencing the existence and amounts of, the
insurance required under Paragraph-8:2(a) and 8.4. 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.
8.6 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 (whether In contract or in tort) against the
other, for loss or damage to their property arising out of or incident to the
perils required to t>e insured against under Paragraph S. The off act of such
releases and waivers of the right to recover damages shall not be limited by the
amount of insurance carded or required, or by any deductibles applicable
thereto. Lessor and Lessee agree to have their respective insurance companies
issuing property damage insurance 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.
8.7 Indemnity. Except for Lessor's negligence and/or breach of express
warranties, Lessee shall indemnity, 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,
costs, lions, judgments, penalties, loss of permits, attorneys' and consultants'
fees, expenses and/or liabilities arising out of, involving, or in connection
with, the occupancy of the Premises by Lessee, the conduct of Lessee's business,
any art, omission or neglect of Lessee, its agents, contractors, employees or
invitees, and out of any Default or Breach by Lessee in the performance in a
timely manner of any obligation on Lessee's part to be performed under this
Lease. The fore- going shall include, but not be limited to, the defense or
pursuit of any claim or any action or proceeding involved therein, and whether
or not (in the case of claims made against Lessor) litigated and/or reduced to
judgment. In case any action or proceeding be brought against Lessor by reason
of any of the foregoing matters, Lessee upon notice from Lessor shall 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 so indemnified.
8.8 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 or rain, or from the breakage, leakage,
obstruction or other defects of pipes, fire sprinklers, wires, appliances,
plumbing, air conditioning or lighting fixtures, or from any other cause,
whether said injury or damage results from conditions arising upon the Premises
or upon other portions of the Building of which the Premises are a part, from
other sources or places, and regardless of whether the cause of such damage or
injury or the means of repairing the same is accessible or not. Lessor shall not
be liable for any damages arising from any act or neglect of any other lessee of
Lessor nor from the failure by Lessor to enforce the provisions of any other
lease in the Industrial Center. Notwithstanding Lessor's negligence 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 Partial Damage" shall mean damage or destruction to the Premises,
other than Lessee-Owned Alterations and Utility Installations, the repair cost
of which damage or destruction is less than fifty percent (50%) of the then
Replacement Cost (as defined in Paragraph 9.1 (d)) of the Premises (excluding
Lessee-Owned Alterations and Utility Installations and Trade Fixtures)
immediately prior to such damage or destruction.
(b) "Premises Total Destruction" shall mean damage or destruction to the
Premises, other than Lessee-Owned Alterations and Utility Installations, the
repair cost of which damage or destruction is fifty percent (50%) or more of the
then Replacement Cost of the Premises (excluding Lessee-Owned Alterations and
Utility Installations and Trade Fixtures) immediately prior to such damage or
destruction. In addition, damage or destruction to the Building, other than
Lessee-Owned Alterations and Utility Installations and Trade Fixtures of any
lessees of the Building, the cost of which damage or destruction is fifty
percent (50%) or more of the then Replacement Cost (excluding Lessee-Owned
Alterations and Utility Installations and Trade Fixtures of any lessees of the
Building) of the Building shall, at the option of Lessor, be deemed to be
Premises Total Destruction.
(c) "Insured Loss" shall mean damage or destruction to the Premises, other than
Lessee-Owned Alterations and Utility Installations and Trade Fixtures, which was
caused by an event required to be covered by the insurance described in
Paragraph 8,3(a) irrespective of any deductible amounts or coverage limits
involved.
(d) "Replacement Cost" shall mean the cost to repair or rebuild the improvements
owned by Lessor at the time of the occurrence to their condition existing
immediately prior thereto, including demolition, debris removal and upgrading
required by the operation of applicable building codes, ordinances or laws, and
without deduction for depreciation.
(e) "Hazardous Substance Condition" shall mean the occurrence or discovery of a
condition involving the presence of, or a contamination by, a Hazardous
Substance as defined in Paragraph 6.2(a), in, on, or under the Premises.
9.2 Premises Partial Damage - Insured Loss. If Premises Partial Damage that is
an Insured Loss occurs, then Lessor shall, at Lessor's expense, repair such
damage (but not Lessee's Trade Fixtures or Lessee-Owned Alterations and Utility
Installations) as soon as reasonably possible and this Lease shall continue in
full force and effect. In the event, however, that there is a shortage of
insurance proceeds and such shortage is due to the fact that, by reason of the
unique nature of the improvements in the Premises, full replacement cost
insurance coverage was not commercially reasonable and available, Lessor shall
have no obligation to pay for the shortage in insurance proceeds or to fully
restore the unique aspects of the Premises unless Lessee provides Lessor with
the funds to cover same, or adequate assurance thereof, within ten (10) days
following receipt of written notice of such shortage and request therefor. If
Lessor receives said funds or adequate assurance thereof within said ten (10)
day period, Lessor shall complete them as soon as reasonably possible and this
Lease shall remain in full force and effect. If Lessor does not receive such
funds or assurance within said period, Lessor may nevertheless elect by written
notice to Lessee within ten (10) days thereafter to make such restoration and
repair as is commercially reasonable with Lessor paying any shortage in
proceeds, in which case this Lease shall remain in full force and effect. If
Lessor does not receive such funds or assurance within such ten (10) day period,
and if Lessor does not so elect to restore and repair, then this Lease shall
terminate sixty (60) days following the occurrence of the damage or destruction.
Unless otherwise agreed, Lessee shall in no event have any right to
reimbursement from Lessor for any funds contributed by Lessee to repair any such
damage or destruction. Premises Partial Damage due to flood or earth- quake
shall be subject to Paragraph 9.3 rather than Paragraph 9.2, notwithstanding
that there may be some insurance coverage, but the net proceeds of any such
insurance shall be made available for the repairs if made by either Party.
9.3 Partial Damage--Uninsured Loss. If Premises Partial Damage that is not an
Insured Loss occurs, unless caused by a negligent or willful act of Lessee (in
which event Lessee shall make the repairs at Lessee's expense and this Lease
shall continue in full force and effect), 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
writ- ten notice to Lessee within thirty (30) days after receipt by Lessor of
knowledge of the occurrence of such damage 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 such notice of Lessor's intention to terminate this
Lease, Lessee shall have the right within ten (10) days after the receipt of
such notice to give written notice to Lessor of Lessee's commitment to pay for
the repair of such damage totally at Lessee's expense and without reimbursement
from Lessor. Lessee shall provide Lessor with the required funds or satisfactory
assurance thereof within thirty (30) days following such commitment from Lessee.
In such event this Lease shall continue in full force and effect, and Lessor
shall proceed to make such repairs as soon as reasonably possible after the
required funds are available. If Lessee does not give such notice and provide
the funds or assurance thereof with- in the times specified above, this Lease
shall terminate as of the date specified in Lessor's notice of termination.
9.4 Total Destruction. Notwithstanding any other provision hereof, if Premises
Total Destruction occurs (including any destruction required by any authorized
public authority), this Lease shall terminate sixty (60) days following the date
of such Premises Total Destruction, whether or not the damage or destruction is
an Insured Loss or was caused by a negligent or willful act of Lessee. In the
event, however, that the damage or destruction was caused by
Lessee, Lessor shall have the right to recover Lessor's damages from Lessee
except as released and waived in Paragraph 9.7.
9.5 Damage Near End of Term. If at any time during the last six (6) months of
the term of this Lease there is damage for which the cost to repair exceeds one
month's Base Rent, whether or not an Insured Loss, Lessor may, at Lessor's
option, terminate this Lease effective sixty (60) days following the date of
occurrence of such damage by giving written notice to Lessee of Lessor's
election to do so within thirty (30) days after the date of occurrence of such
damage. Provided, however, if Lessee at that time has an exercisable option to
extend this Lease or to purchase the Premises, then Lessee may preserve this-
Lease by (a) exercising such option, and (b) providing Lessor with any shortage
in insurance proceeds (or adequate assurance thereof) needed to make the repairs
on or before the earlier of (i) the date which is ten (10) days after Lessee's
receipt of Lessor's written notice purporting to terminate this Lease, or (ii)
the day prior to the date upon which such option expires. If Lessee duly
exercises such option during such period and provides Lessor with funds (or
adequate assurance thereof) to cover any shortage in insurance proceeds, Lessor
shall, at Lessor's expense repair such damage as soon as reasonably possible and
this Lease shall continue in full force and effect. If Lessee fails to exercise
such option and provide such funds or assurance during such period, then this
Lease shall terminate as of the date set forth in the first sentence of this
Paragraph 9.5.
9.6 Abatement of Rent; Lessee's Remedies.
(a) In the event of (i) Premises Partial Damage or (ii) Hazardous Substance
Condition for which Lessee is not legally responsible, the Base Rent, Common
Area Operating Expenses and other charges, if any, payable by Lessee hereunder
for the period during which such damage or condition, its repair, remediation or
restoration continues, shall be abated in proportion to the degree to which
Lessee's use of the Premises is impaired, but not in excess of proceeds from
insurance required to be carried under Paragraph 8.3(b). Except for abatement of
Base Rent, Common Area Operating Expenses and other charges, if any, as
aforesaid, all other obligations of Lessee hereunder shall be performed by
Lessee, and Lessee shall have no claim against Lessor for any damage suffered by
reason of any such damage, destruction, repair, remediation or restoration.
(b) If Lessor shall be obligated to repair or restore the Premises under the
provisions o. this Paragraph 9 and shall not commence, in a substan a and ment
of such repair or restoration, give written notice to Lessor and to any Lenders
of which Lessee has actual notice of Lessee's election to terminate this Lease
on a date not less than sixty (60) days following the giving of such notice. If
Lessee gives such notice to Lessor and such Lenders and such repair or
restoration is not commenced within thirty (30) days after receipt of such
notice, this Lease shall terminate as of the date specified in said notice. It
Lessor or a Lender commences the repair or restoration of the Premises within
thirty (30) days after the receipt of such notice, this Lease shall continue in
full force and affect. "Commence" as used in this Paragraph 9.6 shall mean
either the unconditional authorization of the preparation of the required plans,
or the beginning of the actual work on the Premises, whichever occurs first.
9.7 Hazardous Substance Conditions. If a Hazardous Substance Condition
occurs, unless Lessee is legally responsible therefor (in which case Lessee
shall make the investigation and remediation thereof required by Applicable
Requirements and this lease shall continue in full force and effect, but subject
to Lessor's rights under Paragraph 6.2(c) and 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, ii
which event this Lease shall continue in full force and effect, or (ii) if the
estimated cost to investigate and 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 such notice of Lessor's intention to
terminate this Lease, Lessee shall have the right within ten (10) days after the
receipt of such notice to give written notice to Lessor of Lessee's commitment
to pay for the excess costs of (a) investigation and remediation of such
Hazardous Substance Condition to the extent required by Applicable Requirements,
over (b) an amount equal to twelve (12) times the then monthly Base Rent or
$100,000, whichever is greater. Lessee shall provide Lessor with the funds
required of Lessee or satisfactory assurance thereof within thirty (30) days
following said commitment by Lessee. In such event this Lease shall continue in
full force and effect, and Lessor shall proceed to make such investigation and
remediation as soon as reasonably possible after the required funds are
available. If Lessee does not give such notice and provide the required funds or
assurance thereof within the time period specified above, this Lease shall
terminate as of the date specified in Lessor's notice of termination.
9.8 Termination-Advance Payments. Upon termination of this Lease pursuant to
this Paragraph 9, Lessor shall return to Lessee any advance payment made by
Lessee to Lessor and so much of Lessee's Security Deposit as has not been, or is
not then required to be, used by Lessor under the terms of this Lease.
9.9 Waiver of Statutes. Lessor and Lessee agree that the terms of this Lease
shall govern the effect of any damage to or destruction of the Premises and the
Building with respect to the termination of this Lease and hereby waive the
provisions of any present or future statute to the extent it is Inconsistent
herewith.
10. Real Property Taxes.
10.1 Payment of Taxes. Lessor shall pay the Real Property Taxes, as defined
in Paragraph 10.2(a), applicable to the Industrial Center, and except as
otherwise provided in Paragraph 10.3, any increases in such amounts over the
Base Real Property Taxes shall be included in the calculation of Common Area
Operating Expenses In accordance with the provisions of Paragraph 4.2.
10.2 Real Property Tax Definitions.
(a) As used herein, the term "Real Property Taxes" shall include any form of
real estate tax or assessment, general, special, ordinary or extraordinary, and
any license fee, commercial rental tax. improvement bond or bonds, levy or tax
(other than inheritance, personal income or estate taxes) imposed upon the
Industrial Center by any authority having the direct or indirect power to tax,
including any city, state or federal government, or any school, agricultural,
sanitary, fire, street, drainage, or other improvement district thereof, levied
against any legal or equitable interest of Lessor in the Industrial Center or
any portion thereof, Lessor's right to rent or other income therefrom, and/or
Lessor's business of leasing the Premises. The term "Real Property Taxes" shall
also include any tax, fee, levy, assessment or charge, or any increase therein,
imposed by reason of events occurring, or changes in Applicable Law taking
affect, during the term of this Lease, including but not limited to a change in
the ownership of the Industrial Center or in the improvements thereon, the
execution of this Lease, or any modification, amendment or transfer thereof, and
whether or not contemplated by the Parties.
(b) As used herein, the term "Base Real Property Taxes" shall be the amount of
Real Property Taxes, which are assessed against the Premises, Building or Common
Areas in the calendar year during which the Lease is executed. In calculating
Real Property Taxes for any calendar year, the Real Property Taxes for any real
estate tax year shall be included in the calculation of Real Property Taxes for
such calendar year based upon the number of days which such calendar year and
tax year have in common.
10.3 Additional Improvements. Common Area Operating Expenses shall not include
Real Property Taxes specified in the tax assessor's records and work sheets as
being caused by additional improvements placed upon the Industrial-Center by
other lessee's or by Lessor for the exclusive enjoyment of such other lessees.
Notwithstanding Paragraph 10.1 hereof, Lessee shall, however, pay to Lessor at
the time Common Area Operating Expenses are payable under Paragraph 4.2, the
entirety of any increase in Real Property Taxes if assessed solely by reason of
Alterations, Trade Fixtures or Utility Installations placed upon the Premises by
Lessee or at Lessee's request.
10.4 Joint Assessment. If the Building is not separately assessed, Real
Property Taxes allocated to the Building shall be an equitable proportion of the
Real Property taxes for all of the land and improvements included within the tax
parcel assessed, such proportion to be determined by Lessor from the respective
valuations assigned in the assessor's work sheets or such other information, as
may be reasonably available. Lessor's reasonable determination thereof, in good
faith, shall be conclusive.
10.5 Lessee's Property Taxes. Lessee shall pay prior to delinquency all
taxes assessed against and levied upon Lessee-Owned Alterations and Utility
Installations, Trade Fixtures, furnishings, equipment and all personal property
of Lessee contained in the Premises or stored within the Industrial Center. When
possible, Lessee shall cause its Lessee-Owned Alterations and Utility
Installations, Trade Fixtures, furnishings, equipment and all other personal
property to be assessed and billed separately from the real property of Lessor
If any of Lessee's said property shall be assessed with Lessor's real property,
Lessee shall pay Lessor the taxes attributable to Lessee's property within ten
(10) days after receipt of a written statement setting forth the taxes
applicable to Lessee's property.
11. Utilities. Lessee shall pay directly for all utilities and services
supplied to the Premises, including but not limited to electricity, telephone,
security, gas and cleaning of the Premises, together with any taxes thereon. If
any such utilities or services are not separately metered to the Premises or
separately billed to the Premises, Lessee shall pay to Lessor a reasonable
proportion to be determined by Lessor of all such charges jointly metered or
billed with other premises in the Building, in the manner and within the time
periods set forth in Paragraph 4.2(d).
12. Assignment and Subletting.
12.1 Lessor's Consent Required.
(a) Lessee shall not voluntarily or by operation of law assign, transfer,
mortgage or otherwise transfer or encumber (collectively, "assign") or sublet
all or any part of Lessee's interest in this Lease or in the Premises without
Lessor's prior written consent given under and subject to the terms of Paragraph
36.
(b) A change in the control of Lessee shall constitute an assignment requiring
Lessor's consent. The transfer, on a cumulative basis, of twenty-five per- cent
(25%) or more of the voting control of Lessee shall constitute a change in
control for this purpose.
(c) The involvement of Lessee or its assets in any transaction, or series of
transactions (by way of merger, sale, acquisition, financing, refinancing,
transfer, leveraged buy-out or otherwise), whether or not a formal assignment or
hypothecation of this Lease or Lessee's assets occurs, which results or will
result in a reduction of the Net Worth of Lessee, as hereinafter defined, by an
amount equal to or greater than twenty-five percent (25%) of such Net Worth of
Lessee as it was represented to Lessor at the time of full execution and
delivery of this Lease or at the time of the most recent assignment to which
Lessor has consented, or as it exists immediately prior to said transaction or
transactions constituting such relocation. at whichever time said Not Worth of
Lessee was or is greater, shall be considered an assignment of this Lease by
Lessee to which Lessor may reasonably withhold its consent. "Net Worth of
Lessee" for purposes of this Lease shall be the net worth of Lessee (excluding
any Guarantors) established under generally accepted accounting principles
consistently applied.
(d) An assignment or subletting of Lessee's interest in this Lease without
Lessor's specific prior written consent shall, at Lessor's option, be a Default
curable a-ler notice per Paragraph 13.1, or a non-curable Breach without the
necessity of any notice and grace period. If Lessor elects to treat such
unconsented to assignment or subletting as a non-curable Breach, Lessor shall
have the right to either: (i) terminate this Lease, or (ii) upon thirty (30)
days' written notice ("Lessor's Notice"), increase the monthly Base Rent for the
Premises to the greater of the fair market rental value of the Premises, as
reasonably determined by Lessor, or one hundred ten percent (110%) of the Base
Rent then in effect. Pending determination of the new fair market rental value,
if disputed by Lessee, Lessee shall pay the amount set forth in Lessor's Notice,
with any overpayment credited against the next installment(s) of Base Rent
coming due, and any underpayment for the period retroactively to the effective
date of the adjustment being due and payable immediately upon the determination
thereof. 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 the then fair market value as reasonably
determined by Lessor (without the Lease being considered an encumbrance or any
deduction for depreciation or obsolescence, and considering the Premises at its
highest and beat use and in good condition) or one hundred ten percent (110%) of
the price previously in effect, (ii) any index-oriented rental or price
adjustment formulas contained 'n this Lease shall be adjusted to require that
the base index be determined with reference to the index applicable to the time
of such adjustment, and (iii) any fixed rental adjustments scheduled during the
remainder of the Lease term shall be increased in the same ratio as the new
rental bears to the Base Rent in effect immediately prior to the adjustment
specified in Lessor's Notice.
(e) Lessee's remedy for any breach of this Paragraph 12.1 by Lessor shall be
limited to compensatory damages and/or injunctive relief.
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 obligation- of Lessee under this Lease, (ii) release Lessee of
any obligations hereunder, nor (iii) alter the primary liability of Lessee for
the payment of Base Rent and other sums due Lessor hereunder or for the
performance of any other obligations to be performed by Lessee under this Lease.
(b) Lessor may accept any 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 any rent for performance shall constitute a waiver or estoppel of
Lessor's right to exercise its remedies '.or the Default or Breach by Lessee of
any of the terms, covenants or conditions of !his Lease.
(c) The consent of Lessor to any assignment or subletting shall not constitute a
consent to any subsequent assignment or subletting by Lessee or to any
subsequent or successive assignment or subletting by the assignee or sublessee.
However, Lessor @nay consent to subsequent sublettings and assignments of the
sublease or any amendments or modifications thereto without notifying Lessee or
anyone else liable under this Lease or the sublease and without obtaining their
consent, and such action shall not relieve such pe,Fons from liability under
this Lease or the sublease.
(d) In the event of any Default or Breach of Lessee's obligation under this
Lease, Lessor may proceed directly against Lessee, any Guarantors or any- one
else responsible for the performance of the Lessee's obligations under this
Lease, including any sublessee, without first exhausting Lessor's remedies
against any other person or entity responsible therefor 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 subleases, including but not limited to the intended use and/or
required modification of the Premises, if any, together with a non-refundable
deposit of $1,000 or ten percent (10%) of the monthly Base Rent applicable to
the portion of the Premises which is the subject of the proposed assignment or
sublease, whichever IF greater, as reasonable consideration for Lessor's
considering and processing the request for consent. Lessee agrees to provide
Lessor with such other or additional information and/or documentation as may be
reasonably requested by Lessor.
(f) Any assignee of, or sublessee under, this Lease shall, by reason of
accepting such assignment or entering into such sublease, be deemed, for the
benefit of Lessor, to have assumed and agreed to conform and comply with each
and every term, covenant, condition and obligation heroin to be observed or per-
formed 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.
(g) The occurrence of a transaction described In Paragraph 12.2(c) shall give
Lessor-tbe-dghL-(but not the obligation) to require that the Security Deposit be
increased by an amount equal to six (6) times the tokamak and Lessor may make
the actual receipt by Lessor of the Security Deposit Increase a condition to
Lessor's consent to such transaction.
(h) Lessor, as a condition to giving its consent to any assignment or
subletting, may require that the amount and adjustment schedule of the rent
payable under this Lease be adjusted to what is then the market value and/or
adjustment schedule for property similar to the Premises as then constituted, as
determined by Lessor.
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) Lessee hereby assigns and transfers to Lessor all of Lessee's interest in
all rentals and income arising from any sublease of all or a portion of the
Premises heretofore or hereafter made by Lessee, and Lessor may collect such
rent and income and apply same toward Lessee's obligations under this Lease;
provided, however, that until a Breach (as defined in Paragraph 13.1) shall
occur in the performance of Lessee's obligations under this Lease, Lessee may,
except as otherwise provided in this Lease, receive, collect and enjoy the rents
accruing under such sublease. Lessor shall not, by reason of the foregoing
provision or any other assignment of such sublease to Lessor, nor by reason of
the collection of the rents from a subleases, be deemed liable to the sublessee
for any failure of Lessee to perform and comply with any of Lessee's obligations
to such sublessee under such Sublease. 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 the rents and other charges due and to become due under
the sublease. Sublessee shall rely upon any such statement and request from
Lessor and shall pay such rents and other charges to Lessor without any
obligation or right to inquire as to whether such Breach exists and
notwithstanding any notice from or claim from Lessee to the contrary. Lessee
shall have no right or claim against such sublessee, or, until the Breach has
been cured, against Lessor, for any such rents and other charges so paid by said
subleases to Lessor.
(b) In the event of a Breach by Lessee in the performance of its obligations
under this Lease, Lessor, at its option and without any obligation to do so, may
require any 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 sub- lessee to such sublessor or for any other prior defaults or breaches
of such sublessor under such sublease.
(c) Any matter or thing requiring the consent of the sublessor under a sublease
shall also require the consent of Lessor herein.
(d) No sublessee under a sublease approved by Lessor shall further assign or
sublet all or any part of the Premises without Lessors 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.
13. Default; Breach; Remedies.
53
13.1 Default; Breach. Lessor and Lessee agree that if an attorney is
consulted by Lessor in connection with a Lessee Default or Breach (as
hereinafter defined), $350.00 is a reasonable minimum sum per such occurrence
for legal services and costs in the preparation and service of a notice of
Default, and that Lessor may include the cost of such services and costs in said
notice as rent due and payable to cure said default. A "Default" by Lessee is
defined as a failure by Lessee to observe, comply with or perform any of the
terms, covenants, conditions or rules applicable to Lessee under this Lease. A
"Breach" by Lessee is defined as the occurrence of any one or more of the
following Defaults, and, where a grace period for cure after notice is specified
herein, the failure by Lessee to cure such Default prior to the expiration of
the applicable grace period, and shall entitle Lessor to pursue the remedies set
forth in Paragraphs 13.2 and/or 13.3:
(a) The vacating of the Premises without the intention to reoccupy same, or the
abandonment of the Premises.
(b) Except as expressly otherwise provided in this Lease, the failure by Lessee
to make any payment of Base Rent, Lessee's Share of Common Area Operating
Expenses, or any other monetary payment required to be made by Lessee hereunder
as and when due, the failure by Lessee to provide Lessor with reasonable
evidence of insurance or surety bond required under this Lease, or the failure
of Lessee 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 thereof by or on behalf of Lessor to Lessee.
(c) Except as expressly otherwise provided in this Lease, the failure by Lessee
to provide Lessor with reasonable written evidence (in duly executed original
form, if applicable) of (I) compliance with Applicable Requirements per
Paragraph 6.3, (ii) the inspection, maintenance and service contracts required
under Paragraph 7.1 (b), (iii) the rescission of an unauthorized assignment or
subletting per Paragraph 12. 1, (iv) a Tenancy Statement per Paragraphs 16 or
37, (v) the subordination or non-subordination of this Lease per Paragraph 30,
(vi) the guaranty of the performance of Lessee's obligations under this Lease if
required under Paragraphs 1.11 and 37, (vii) the execution of any document
requested under Paragraph 42 (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 ten (10) days
following written notice by or on behalf of Lessor to Lessee.
(d) A Default by Lessee as to the terms, covenants, conditions or provisions of
this Lease, or of the rules adopted under Paragraph 40 hereof that are to be
observed, complied with or performed by Lessee, other than those described in
Subparagraphs 13.1 (a), (b) or (c), above, where such Default continues for a
period of thirty (30) days after written notice thereof by or on behalf of
Lessor to Lessee; provided, however, that if the nature of Lessee's Default is
such that more than thirty (30) days are reasonably required for its cure, then
it shall not be deemed to be a Breach of this Lease by Lessee if Lessee
commences such cure within said thirty 30 day period and thereafter diligently
prosecutes such cure to completion.
(e) The occurrence of any of the following events: (i) the making by Lessee of
any general arrangement or assignment for the benefit of creditors; (ii)
Lessee's becoming a 'debtor" as defined in 11 U.S. Code Section 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
54
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 13.1 (a) is contrary to any
applicable law, such provision shall be of no force or effect, and shall not
affect the validity of the remaining provisions.
(f) The discovery by Lessor that any financial statement of Lessee or of any
Guarantor, given to Lessor by Lessee or any Guarantor, 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 breach basis, and Lessee's
failure, within sixty (60) days following written notice by or on behalf of
Lessor to Lessee of any such event, to provide Lessor with written alternative
assurances of 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.
13.2 Remedies. If Lessee fails to perform any affirmative duty or
obligation of Lessee under this Lease, within ten (10) days after written notice
to Lessee (or in case of an emergency, without notice), Lessor may at its option
(but without obligation to do so), 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 to Lessor upon invoice therefor. If any check given to Lessor by Lessee
shall not be honored by the bank upon which it is drawn, Lessor, at its own
option, may require all future payments to be made under this Lease by Lessee to
be made only by cashier's check. In the event of a Breach of this Lease by
Lessee (as defined in Paragraph 13.1), 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, Lessor may:
(a) Terminate Lessee's right to possession of the Premises by any lawful means,
in which case this Lease and the term hereof shall terminate and Lessee shall
immediately surrender possession of the Premises to Lessor. In such event Lessor
shall be entitled to recover from Lessee: (i) the worth at the time of the award
of 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
55
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 San
Francisco or the Federal Reserve Bank District in which the Premises are located
at the time of award plus one percent (1%). Efforts by Lessor to mitigate
damages caused by Lessee's Default or Breach of this Lease shall not waive
Lessor's right to recover damages under this Paragraph 13.2. If termination of
this Lease is obtained through the provisional remedy of unlawful detainer,
Lessor shall have the right to recover in such proceeding the 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 for such rent and/or damages. If a
notice and grace period is required under Subparagraph 13.1 (b), (c) or (d) was
not previously given, a notice to pay rent or quit, or to perform or quit, as
the case may be, given to Lessee under any statute authorizing the forfeiture of
leases for unlawful detainer shall also constitute the applicable notice for
grace period purposes required by Subparagraph 13.1 (b),(c) or (d). In such
case, the applicable grace period under the unlawful detainer statue shall run
concurrently after the one such statutory notice, and the failure of Lessee to
cure the Default within the greater of the two (2) 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.
(b) Continue the Lease and lessee's right to possession in effect (in
California under California Civil Code Section 1951.4) after Lessee's Breach and
recover the rent as it becomes due, provided Lessee has the right to sublet or
assign, subject only to reasonable limitations. Lessor and Lessee agree that the
limi-tations on assignment and subletting in this Lease are reasonable. Acts of
maintenance or preservation, efforts to relat the Premises, or the appointment
of a receiver to protect the Lessor's interest under this Lease, shall not
constitute a termination of the Lessee's right to possession.
(c) Pursue any other remedy now or hereafter available to Lessor under the laws
or judicial decisions of the state wherein the Premises are located.
(d) 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 In Event of Breach. Any agreement by Lessor for
free or abated rent or other charges applicable to the Premises, 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 to be performed or observed by
Lessee during the term hereof as the same may be extended. Upon the occurrence
of a Breach (as defined in Paragraph 13.1) of this Lease by Lessee, any such
Inducement Provision shall automatically be deemed deleted from this Lease and
of no further force or allect, 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,
are recoverable by Lessor, as additional rent due under this Lease,
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 13.3 shall not be def)rned a waiver by Lessor of the provisions of
56
this Paragraph 13.3 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 to
Lessor of rent and other sums due hereunder will cause Lessor to incur costs not
contemplated by this Lease, the exact amount of which will be extremely
difficult to ascertain. Such costs Include, but are not lim4ed to, processing
and accounting charges, and late charges which may be imposed upon Lessor by the
terms of any ground lease, mortgage or dead of trust.@tovering the Premises'
Accordingly, if any installment of rent or other sum due from Lessee shall not
be received by Lessor or Lessor's designee within tan (10) days after such
amount shall be due, then, without any requirement for notice to Lessee, Lessee
shall pay to Lessor a late charge equal to six percent (6%) of such overdue
amount. The parties hereby agree that such late charge represents a fair and
reasonable estimate of the costs Lessor will Incur by reason of late payment by
Lessee. 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 Lessor from exercising any of the other rights and remedies granted
hereunder. In the event that a late charge is payable hereunder, whether or not
collected, for three (3) consecutive installments of Base Rent, then
notwithstanding Paragraph 4.1 or any other provision of this Lease to the
contrary, Base Rent shall, at Lessor's option, become due and payable quarterly
in advance.
13.5 Breach by Lessor. Lessor shall not be deemed in breach of this Lease
unless Lessor fails within a reasonable time to perform an obligation required
to be performed by Lessor. For purposes of this Paragraph 13.5, a reasonable
time shall in no event be less than thirty (30) days after receipt by Lessor,
and by any Lender(s) whose name and address shall have been furnished to Lessee
in writing for such purpose, of written notice specifying wherein such
obligation of Lessor has not been performed; provided, however, that if the
nature of Lessor's obligation is such that more than thirty (30) days after such
notice are reasonably required for its performance, then Lessor shall not be in
breach of this Lease if performance is commenced within such thirty (30) day
period and thereafterdiii- gently pursued to completion.
14. Condemnation. If the Premises or any portion thereof are taken under the
power of eminent domain or sold under the threat of the exercise of said power
(all of which are herein called "condemnation"), this Lease shall terminate as
to the part so taken as of the date the condemning authority takes title or
possession, whichever first occurs. If more than ten percent (10%) of the floor
area of the Premises, or more than twenty-five percent (25%) of the portion of
the Common Areas designated for Lessee's parking, is taken by condemnation,
Lessee may, at Lessee's option, to be exercised in writing within ten (10) days
after Lessor shall have given Lessee written notice of such taking (or in the
absence of such notice, within ten (10) days after the condemning authority
shall have taken possession) terminate this Lease as of the date the condemning
authority takes such possession. If 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 Base Rent shall be
reduced in the same proportion as the rentable floor area of the Premises taken
bears to the total rentable floor area of the Premises. No reduction of Base
Rent shall occur if the condemnation does not apply to any portion of the
Premises. Any award for the taking of all or any part of the Premises under the
power of eminent domain or any payment made under threat of the exercise of such
power shall be the property of Lessor, whether such award shall be made as
compensation for diminution of value of the leasehold or for the taking of the
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fee, or as severance damages; provided, however, that Lessee shall be entitled
to any compensation separately awarded to Lessee for Lessee's relocation
expenses and/or loss of Lessee's Trade Fixtures. In the event that this Lease is
not terminated by reason of such condemnation, Lessor shall to the extent of its
net severance damages received, over and above Lessee's Share of the legal and
other expenses incurred by Lessor in the condemnation matter, repair any damage
to the Premises caused by such condemnation authority. Lessee shall be
responsible for the payment of any amount in excess of such not severance
damages required to complete such repair. 15. Brokers' Fees.
15.1 Procuring Cause. The Broker(s) named in Paragraph 1.10 is/are the
procuring cause of this Lease.
15.2 This Paragraph has been intentionally omitted.
15.3 Assumption of Obligations. Any buyer or transferee of Lessor's interest
in this Lease, whether such transfer is by agreement or by operation of law
shall be deemed to have assumed Lessor's obligation under this Paragraph 15.
Each Broker shall be an intended third party beneficiary of the provisions of
Paragraph 1.10 and of this Paragraph 15 to the extent of its interest in any
commission arising from this Lease and may enforce that right directly against
Lessor and its successors.
15.4 Representations and Warranties. Lessee and Lessor each represent and
warrant to the other that it has had no dealings with any person, firm, broker
or finder other than as named in Paragraph 1.10(a) in connection with the
negotiation of this Lease and/or the consummation of the transaction
contemplated hereby, and that no broker or other person, firm or entity other
than said named Broker(s) is entitled to any commission or finder's fee in
connection with said transaction. Lessee and Lessor do each hereby agree to
indemnity, protect, defend and hold the other harmless from and against
liability for compensation or charges which may be claimed by any such unnamed
broker, finder or other similar party by reason of any dealings or actions of
the indemnifying Party, including any costs, expenses, and/or attorneys' fees
reasonably incurred with respect thereto.
16. Tenancy and Financial Statements.
16.1 Tenancy Statement. Each Party (as "Responding Party") shall within ten
(10) days after written notice from the other Party (the "Requesting Party")
execute, acknowledge and deliver to the Requesting Party a statement in writing
in a form similar to the then most current "Tenancy Statement" form published by
the American Industrial Real Estate Association, plus such additional
information, confirmation and/or statements as may be reasonably requested by
the Requesting Party.
16.2 Financial Statement. If Lessor desires to finance, refinance, or sell
the Premises or the Building, or any part thereof, Lessee and all Guarantors
shall deliver to any potential lender or purchaser designated by Lessor such
financial statements of Lessee and such Guarantors as may be reasonably required
by such lender or purchaser, including but not limited to Lessee's financial
statements for the past three (3) years. All such financial statements shall be
received by Lessor and such lender or purchaser in confidence and shall be used
only for the purposes herein set forth.
17. Lessor's Liability. The term "Lessor" as used herein shall mean the owner
or owners at the time in question of the too title to the Premises. In the event
of
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a transfer of Lessor's title or interest in the Premises or iii this Lease,
Lessor shall deliver to the transferee or assignee (in cash or by credit) any
unused Security Deposit held by Lessor at the time of such transfer or
assignment. Except as provided in Paragraph 15.3, upon such transfer or
assignment and delivery of the Security Deposit, as aforesaid, the prior Lessor
shall be relieved of all liability with respect to the obligations and/or
covenants under this Lease thereatterto be performed by the Lessor. Subject to
the foregoing, the obligations and/or covenants in this Lease to be performed by
the Lessor shall be binding only upon the Lessor as hereinabove defined.
18. Severablility. The invalidity of any provision of this Lease, as determined
by a court of competent jurisdiction, shall in no way affect the validity of any
other provision hereof.
19. Interest on Past-Due Obligations. Any monetary payment due Lessor
hereunder, other than late charges, not received by Lessor within tan (10) days
following the date on which it was due, shall bear interest from the date due at
the prime rate charged by the largest state chartered bank in the state in which
the Premises are located plus four percent (4%)^pp@rqr)nurn, but not exceeding
the maximum rate allowed by law, in addition to the potential late charge
provided for in Paragraph 13.4.
20. Time of Essence. Time is of the essence with respect to the performance of
all obligations to be performed or observed by the Parties under this Lease.
21. Rent Defined. All monetary obligations of Lessee to Lessor under the terms
of this Lease are deemed to be rent.
22. No Prior or other Agreements; Broker Disclaimer. This Lease contains all
agreements between the Parties with respect to any matter mentioned herein, and
no other prior or contemporaneous agreement, or understanding shall be
effective. Lessor and Lessee each represents and warrants to the Brokers that it
has made, and is relying solely upon, its own investigation as to the nature,
quality, character and financial responsibility of the other Party to this Lease
and as to the nature, quality and character of the Premises. Brokers have no
responsibility with respect thereto or with respect to any default or breach
hereof by either Party. Each Broker shall be an intended third party beneficiary
of the provisions of this Paragraph 22.
23. Notices.
23.1 Notice Requirements. All notices required or permitted by this Lease
shall be in writing and may be delivered in person (by hand or by messenger or
courier service) or may be sent by regular, certified or registered mail or U.S.
Postal Service Express Mail, with postage prepaid, or by facsimile transmission
during normal business hours, and shall be deemed sufficiently given If served
in a manner specified in this Paragraph 23. The addresses noted adjacent to a
Party's signature on this Lease shall be that Party's address for delivery or
mailing of notice purposes. Either Party may by written 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 the purpose of mailing or delivering notices to Lessee. 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 written notice to Lessee.
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23.2 Date of Notice. Any notice sent by registered or certified mail, return
receipt requested, shall be deemed given on the date of delivery shown on the
receipt card, or if no delivery date Is shown, the postmark thereon. If sent by
regular mail, the notice shall be deemed given forty-eight (48) hours after the
same is addressed as required herein and mailed with postage prepaid. Notices
delivered by United States Express Mail or overnight courier that guarantees
next day delivery shall be deemed given twenty-four (24) hours after delivery of
the same to the United States Postal Service or courier. If any notice is
transmitted by facsimile transmission or similar means, the same shall be deemed
served or delivered upon telephone or facsimile confirmation of receipt of the
transmission there- of, provided a copy is also delivered via delivery or mail.
If notice is received on a Saturday or a Sunday or a legal holiday, it shall be
deemed received on the next business day.
24. Waivers. No waiver by Lessor of the Default or Breach of any term, covenant
or condition hereof by Lessee, shall be deemed a waiver of any other term,
covenant or condition hereof, or of any subsequent Default or Breach by Lessee
of the same or any other term, covenant or condition hereof. Lessor's consent
to, or approval of, any such act shall not be doomed to ronder unnecessary the
obtaining of Lessor's consent to, or approval of, any subsequent or similar act
by Lessee, or be construed as the basis of an estoppel to enforce the provision
or provisions of this Lease requiring such consent. Regardless of Lessor's
knowledge of a Default or Breach at the time of accepting rent, the acceptance
of rent by Lessor shall not be a waiver of any Default or Breach by Lessee of
any provision hereof. Any payment given Lessor by Lessee may be accepted by
Lessor on account of moneys or damages due Lessor, notwithstanding any
qualifying statements or conditions made by Lessee in connection therewith,
which such statements and/or conditions shall be of no force or effect
whatsoever unless specifically agreed to In writing by Lessor at or before the
time of deposit of such payment.
25. This Paragraph has been intentionally omitted.-
26. No Right To Holdover. Lessee has no right to retain possession of the
Premises or any part thereof beyond the expiration or earlier termination of
this Lease. In the event that Lessee holds over in violation of this Paragraph
26 then the Base Rent payable from and after the time of the expiration or
earlier termination of this Lease shall be increased to two hundred percent
(200%) of the Base Rent applicable during the month Immediately preceding such
expiration or earlier termination. Nothing contained herein shall be construed
as a consent by Lessor to any holding over by Lessee.
27. Cumulative Remedies. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other remedies at
law or in equity.
28. Covenants and Conditions. All provisions of this Lease to be observed or
performed by Lessee are both covenants and conditions.
29. Binding Effect; Choice of Law. This Lease shall be binding upon the
Parties, their personal representatives, successors and assigns and be governed
by the laws of the State in which the Premises are located. Any litigation
between the Parties hereto concerning this Lease shall be initiated in the
county in which the Premises are located.
30. Subordination; Attarnment; Non-Disturbance.
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30.1 Subordination. This Lease and any Option granted hereby shall be subject
and subordinate to any ground lease, mortgage, dead of trust, or other
hypothecation or security device (collectively, "Security Device"), now or
hereafter placed by Lessor upon the real property of which the Premises are a
part, to any and all advances made on the security thereof, and to all renewals,
modifications, consolidations, replacements and extensions thereof. Lessee
agrees that the Lenders holding any such Security Device shall have no duty,
liability or obligation to perform any of the obligations of Lessor under this
Lease, but that in the event of Lessor's default with respect to any such
obligation, Lessee will give any Lender whose name and address have been
furnished Lessee in writing for such purpose notice of Lessor's default pursuant
to Paragraph 13.5. If any Lender shall elect to have this Lease and/or any
Option granted hereby superior to the lien of its Security Device and shall give
written notice thereof to Lessee, this Lease and such Options shall be deemed
prior to such Security Device, notwithstanding the relative dates of the
documentation or recordation thereof.
30.2 Attornment. Subject to the non-disturbance provisions of Paragraph 30.3,
Lessee agrees to attorn to a Lender or any other party who acquires owner- ship
of the Premises by reason of a foreclosure of a Security Device, and that in the
event of such foreclosure, such new owner shall not: (I) be liable for any act
or omission of any prior lessor or with respect to events occurring prior to
acquisition of ownership, (II) be subject to any offsets or defenses which
Lessee might have against any prior lessor, or (III) be bound by prepayment of
more than one month's rent.
30.3 Non-Disturbance. With respect to Security Devices entered into by Lessor
after the execution of this lease, Lessee's subordination of this Lease shall be
subject to receiving assurance (a 'non-disturbance agreement') from the Lender
that Lessee's possession and this Lease, including any options to extend the
term hereof, will not be disturbed so long as Lessee is not in Breach hereof and
attorns to the record owner of the Premises.
30.4 Self-Executing. The agreements contained in this Paragraph 30 shall be
effective without the execution of any further documents; provided, however,
that upon written request from Lessor or a Lender in connection with a sale,
financing or refinancing of Premises, Lessee and Lessor shall execute such
further writings as may be reasonably required to separately document any such
subordination or non-subordination, adornment and/or non-disturbance agreement
as is provided for herein.
31. Attorneys' Fees. If any Party or Broker brings an action or proceeding to
enforce the terms hereof or declare rights hereunder, the Prevailing Party (as
here- after defined) in any such proceeding, action, or appeal thereon, shall be
entitled to reasonable attorneys' fees. Such fees may be awarded in the same
suit or recovered in a separate suit, whether or not such action or proceeding
is pursued to decision or judgment. The term "Prevailing Party" shall include,
without limitation, a Party or Broker who substantially obtains or defeats the
relief sought, as the case may be, whether by compromise, settlement, judgment,
or the abandonment by the other Party or Broker of its claim or defense. 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. Lessor shall be entitled to attorneys' fees, costs and expenses
incurred in preparation and service of notices of Default and consultations in
connection therewith, whether or not a legal action is subsequently commenced In
connection with such Default or resulting Breach. Broker(s) shall be intended
third party beneficiaries of this Paragraph 31.
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32. Lessor's Access; Showing Premises; Repairs. Lessor and Lessor's agents
shall have the right to enter the Premises at any time, in the case of an
emergency, and otherwise at reasonable times for the purpose of showing the same
to prospective purchasers, lenders, or lessees, atid making such alterations,
repairs improvements or additions to the Premises or to the Building, as Lessor
may reasonably deem necessary. Lessor may at any time place on or about the
Premises or Building any ordinary 'For Sale' signs and Lessor may at any time
during the last one hundred eighty (180) days of the term hereof place on or
about the Premises any ordinary 'For Lease' signs. All such activities of Lessor
shall be without abatement of rent or liability to Lessee.
33. Auctions. Lessee shall not conduct, nor permit to be conducted, either
voluntarily or involuntarily, any auction upon the Premises without first having
obtained 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.
34. Signs. Lessee shall not place any sign upon the exterior of the Premises or
the Building, except that Lessee-may, with Lessor's prior written Consent,
install (but not on the roof) such signs as are reasonably required to advertise
Lessee's own business so long as such signs are in a location designated by
Lessor and comply with applciable signage criteria established by the
Industrial; Center by Lessor. The installation of any sign on the Premises by or
for Lessee shall be subject to the provisions of Paragraph 7 (Maintenance,.
Repairs, Utility Installations, Trade Fixtures and Alterations). Unless
otherwise expressly agreed herein, Lessor reserves all rights to the use of the
roof of the Building, and the right to install advertising signs on the
Building, including the roof, which do not unreasonably interfere with the
conduct of Lessee's business; Lessor shall be entitled to all revenues from such
advertising signs.
35. Termination; Merger. Unless specifically stated otherwise in writing by
Lessor, the voluntary or other surrender of this Lease by Lessee, the mutual
termination or cancellation hereof, or a termination hereof by Lessor for Breach
by Lessee, shall automatically terminate any sublease or lessor estate in the
Premises; provided, however, Lessor shall, in the event of any such surrender,
termination or cancellation, have the option to continue any one or all of any
existing subtenancies. Lessor's failure within ten (10) days following any such
event to make a written election to the contrary by written notice to the holder
of any such lessor interest, shall constitute Lessor's election to have such
event constitute the termination of such interest.
36. Consents.
(a) Except for Paragraph 33 hereof (Auctions) or as otherwise provided herein,
wherever in this Lease the consent of a Party is required to an act by or
for the other Party, such consent shall not be unreasonably withheld or delayed.
Lessor's actual reasonable costs and expenses (including but not limited to
architects', attorneys', engineers' and other consultants' fees) incurred in the
consideration of, or response to, a request by Lessee for any Lessor consent
pertaining to this Lease or the Premises, including but not limited to consents
to an assignment a subletting or the presence or use of a Hazardous Substance,
shall be paid by Lessee to Lessor upon receipt of an invoice and supporting
documentation therefor. In addition to the deposit described in Paragraph
12.2(e), Lessor may, as a condition to considering any such request by Lessee,
require that Lessee deposit with Lessor an amount of money (in addition to the
62
Security Deposit hold under Paragraph 5) reasonably calculated by Lessor to
represent the cost Lessor will incur in considering and responding to Lessee's
request. Any unused portion of said deposit shall be refunded to Lessee without
interest. Lessor's consent to any act, assignment of this Lease or subletting of
the Premises by Lessee shall not constitute an acknowledgment that no Default or
Breach by Lessee of this Lease exists, nor shall such consent be deemed a waiver
of any then existing Default or Breach, except as may be otherwise specifically
stated in writing by Lessor at the time of such consent.
(b) All conditions to Lessor's consent authorized by this Lease are
acknowledged by Lessee as being reasonable. The failure to specify herein any
particular condition to Lessor's consent shall not preclude the impositions by
Lessor at the time of consent of such further or other conditions as are then
reason-able with reference to the particular matter for which consent is being
given.
37. Guarantor.
37.1 Form of Guaranty. If there are to be any Guarantors of this Lease per
Paragraph 1.11, the form of the guaranty to be executed by each such Guarantor
shall be in the form most recently published by the American Industrial Real
Estate Association, and each such Guarantor shall have the same obligations as
Lessee under this lease, including but not limited to the obligation to provide
the Tenancy Statement and information required in Paragraph 16
37.2 Additional Obligations of Guarantor. It shall constitute a default of
the Lessee under this Lease if any such Guarantor fails or refuses, upon reason-
able request by Lessor to give: (a) evidence of the due execution of the
guaranty called for by this Lease, including the authority of the Guarantor (and
of the party signing on Guarantor's behalf) to obligate such Guarantor on said
guaranty, and resolution of its board of directors authorizing the making of
such guaranty, together with a certificate of incumbency showing the signatures
of the persons authorized to sign on its behalf, (b) current financial
statements of Guarantors may from time to time be requested by Lessor, (c) a
Tenancy Statement, or (d) written confirmation that the guaranty is still in off
act,
38. Quiet Possession. Upon payment by Lessee of the rent for the Premises and
the performance of all of the covenants, conditions and provisions on Lessee's
part to be observed and performed under this Lease, Lessee shall have quiet
possession of the Premises for the entire term hereof subject to all of the
provisions of this Lease.
39. Options.
39.1 Definition. As used in this Lease, the word "Option" has the following
meaning: (a) the right to extend the term of this Lease or to renew this Lease
or to extend or renew any lease that Lessee has on other property of Lessor; (b)
the right of first refusal to lease the Premises or the right of first offer to
lease the Premises or the right of first refusal to lease other property of
Lessor or the right of first offer to lea-se other property of Lessor; (e) the
right to purchase the Premises, or the right of first refusal to purchase the
Premises, or the right of first off or to purchase the Premises, or the right to
purchase other property of Lessor, or the right of first refusal to purchase
other property of Lessor, or the right of first offer to purchase other property
of Lessor.
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39.2 Options Personal to Original Lessee. Each Option granted to Lessee in
this Lease is personal to the original Lessee named in Paragraph 1.1 hereof, and
cannot be voluntarily or involuntarily assigned or exercised by any person or
entity other than said original Lessee while the original Lessee is in full and
actual possession of the Premises and without the intention of thereafter
assigning or subletting. The Options, if any, herein granted to Lessee are not
assignable, either as a part of an assignment of this Lease or separately or
apart therefrom, and no Option may be separated from this Lease in any manner,
by reservation or otherwise.
39.3 Multiple Options. In the event that Lessee has any multiple Options to
extend or renew this Lease, a later option cannot be exercised unless the prior
Options to extend or renew this Lease have been validly exercised.
39.4 Effect of Default on Options.
(a) Lessee shall have no right to exercise an Option, notwithstanding any
provision in the grant of Option to the contrary: (i) during the period
commencing with the giving of any notice of Default under Paragraph 13.1 and
continuing until the noticed Default is cured, or (ii) during the period of time
any monetary obligation due Lessor from Lessee is unpaid (without regard to
whether notice thereof is given Lessee), or (iii) during the time Lessee is in
Breach of this Lease, or (iv) in the event that Lessor has given to Lessee three
(3) or more notices of separate Defaults under Paragraph 13.1 during the twelve
(12) month period immediately preceding the exercise of the Option, whether or
not the Defaults are cured.
(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 39.4(a)
(c) All rights of Lessee under the provisions of an Option shall terminate and
be of no further force or effect, notwithstanding Lessee's due and timely
exercise of the Option, if, after such exercise and during the term of this
Lease, (i) Lessee fails to pay to Lessor a monetary obligation of Lessee for a
period of thirty (30) days after such obligation becomes due (without any
necessity of Lessor to give notice thereof to Lessee), or (ii) Lessor gives to
Lessee three (3) or more notices of separate Defaults under Paragraph 13.1
during any twelve (12) month period, whether or not the Defaults are cured, or
(iii) if Lessee commits a Breach of this Lease.
40. Rules and Regulations. Lessee agrees that it will abide by, and keep and
observe all reasonable rules and regulations ('Rules and Regulations') which
Lessor may make from time to time for the management, safety, care, and
cleanliness of the grounds, the parking and unloading of vehicles and the
preservation of good order, as well as for the convenience of other occupants or
tenants of the Building and the Industrial Center and their invitees.
41. Security Measures. Lessee hereby acknowledges that the rental payable to
Lessor hereunder does not include the cost of guard service or other security
measures, and that Lessor shall have no obligation whatsoever to provide same.
Lessee assumes all responsibility for the protection of the Premises, Lessee,
its agents and invitees and their property from the acts of third parties.
42. Reservations. Lessor reserves the right, from time to time, to grant,
without the consent or joinder of Lessee, such easements, rights of way, utility
raceways, and dedications that Lessor deems necessary, and to cause the
recordation of parcel maps and restrictions, so long as such easements, rights
of way, utility race- ways, dedications, maps and restrictions do not reasonably
interfere with the use of the Premises by Lessee. Lessee agrees to sign any
documents reasonably requested by Lessor to off actuate any such easement
rights, dedication, map or restrictions.
43. Performance Under Protest. If at any time a dispute shall arise as to any
amount or sum of money to be paid by one Party to the other under the provisions
hereof, the Party against whom the obligation to pay the money is asserted shall
have the right to make payment 'under protest' and such payment shall not be
regarded as a voluntary payment and there shall survive the right on the part of
said Party to institute suit for recovery of such sum. If it shall be adjudged
that there was no legal obligation on the part of said Party to pay such sum or
any part thereof, said Party shall be entitled to recover such sum or so much
thereof as it was not legally required to pay under the provisions of this
Lease.
44. Authority. If either Party hereto is a corporation, trust, or general or
limited partnership, each individual executing this Lease on behalf of such
entity represents and warrants that he or she is duly authorized to execute and
deliver this Lease on its behalf. If Lessee is a corporation, trust or
partnership, Lessee shall, within thirty (30) days after request by Lessor,
deliver to Lessor evidence satisfactory to Lessor of such authority.
45. Conflict. Any conflict between the printed provisions of this Lease and the
typewritten or handwritten provisions shall be controlled by the typewritten or
handwritten provisions.
46. Offer. Preparation of this Lease by either Lessor or Lessee or Lessor's
agent or Lessee's agent and submission of same to Lessee or Lessor shall not be
deemed an offer to lease. This Lease is not intended to be binding until
executed and delivered by all Parties hereto.
47. Amendments. This Lease may be modified only in writing, signed by the
parties in interest at the time of the modification. The Parties shall amend
this Lease from time to time to reflect any adjustments that are made to the
Base Rent or other rent payable under this Lease. As long as they do not
materially change Lessee's obligations hereunder, Lessee agrees to make such
reasonable non-monetary modifications to this Lease as may be reasonably
required by an institutional insurance company or pension plan Lender in
connection with the obtaining of normal financing or refinancing of the property
of which the Premises are a part.
48. Multiple Parties. Except as otherwise expressly provided herein, if more
than one person or entity is named herein as either Lessor or Lessee, the
obligations of such multiple parties shall be the joint and several
responsibility of all persons or entities named herein as such Lessor or Lessee.
Assignment Of Parking By Lessor. In the event Lessor finds it necessary, in
Lessor's sole judgement, to assign or reassign vehicle spaces on those portions
of the Common Areas designated by Lessor for parking in order to prevent
disputes between tenants, then and in that event Lessor may do so and Lessee
agrees to abide by Lessor's decision on assigned spaces, and to park only in
such spaces and, in addition, to abide by Paragraph 2.6 of this Lease.
50. No Automotive Work To Be Performed In Parking Lot. Lessee agrees that no
parking spaces, parking areas, or other Common Areas will be used for conducting
automotive repair, overnight parking of vehicles, or storage of vehicles. Use of
parking spaces in the Common Areas for conducting automotive repair, overnight
parking, or storage of vehicles shall be deemed to be a material breach of this
Lease and a violation of Lessor's Rules and Regulations. In the event that any
unauthorized automotive repair, overnight parking, or storage of vehicles shall
occur then Lessor shall have the right, without notice, in addition to such
other rights and remedies that it may have, to remove the vehicle(s) at the
vehicle owner's expense.
51. No Outside Storage or Use of Common Area. Lessee agrees that Lessee will
not use the common area outside the building for storage or for work. All metal
scrap and waste storage, storage of parts, storage of materials, and work shall
take place inside the Premises.
52. Lessee Must Not Violate C. C. & R.'s. The covenants, conditions, and
restrictions ("C. C. & R.'s") for the industrial tract in which the Premises are
located are attached to this Lease as Exhibit "C. Lessee warrants that Lessee
has read, understands, and approves of the C. C. & R.'s. Furthermore, Lessee
agrees to abide by, adhere to, and obey all of these covenants, conditions, and
restrictions. Any failure of Lessee to abide by the covenants, conditions, and
restrictions will be conclusively deemed to be a material breach of this Lease.
53. Trash Container. Lessee is to supply trash containers for packaging
materials, wood scrap, sawdust, liquid wastes, metal scrap and other waste
materials which are to be disposed of. Lessee agrees that Lessee will, at
Lessee's sole expense, supply bins, and/or waste containers for these and other
wastes generated by Lessee's business operations. These bins and/or containers
will remain inside the Premises at all times. It is understood that the trash
bins provided in the trash enclosures in the Common Area are for office waste
only. No manufacturing, packaging, used parts, sawdust, wood scraps, metal
scrap, or waste products of any kind (except office wastes) are to be disposed
of in the Common Area bins or trash enclosures.
54. Rent Escalations During Lease Term. The Base Rent as set forth in Paragraph
1.5 of this Lease will increase to $2,111.50 per month at the beginning of the
13th month of the Lease term. At the beginning of the 25th month the Base Rent
will increase to $2,174.84 per month.
55. WAIVER OF COUNTERCLAIMS AND TRIAL BY JURY. LESSOR AND LESSEE EACH
WAIVES ITS RIGHT TO TRIAL BY JURY IN AN ACTION, PROCEEDING, OR COUNTERCLAIM
BROUGHT BY EITHER AGAINST THE OTHER (EXCEPT FOR PERSONAL INJURY OR PROPERTY
DAMAGE) ON ANY MATTERS 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, AND ANY EMERGENCY STATUTORY OR ANY OTHER STATUTORY REMEDY. IF
LESSOR COMMENCES ANY ACTION OR PROCEEDING IN WHICH LESSOR SEEKS REPOSSESSION OF
THE PREMISES FROM LESSEE, LESSEE SHALL NOT INTERPOSE ANY COUNTERCLAIM OF ANY
NATURE.
LESSOR'S LESSEE'S
INITIALS INITIALS
LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
PROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE SHOW THEIR
INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE
TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE
AND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE
PREMISES.
IF THIS LEASE HAS BEEN FILLED IN, IT HAS BEEN PREPARED FOR YOUR ATTORNEY'S
REVIEW AND APPROVAL. FURTHER, EXPERTS SHOULD BE CONSULTED TO EVALUATE THE
CONDITION OF THE PROPERTY FOR THE POSSIBLE PRESENCE OF ASBESTOS, UNDERGROUND
STORAGE TANKS OR HAZARDOUS SUBSTANCES. NO REPRESENTATION OR RECOMMENDATION IS
MADE BY THE AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION OR BY THE REAL ESTATE
BROKERS OR THEIR CONTRACTORS, AGENTS OR EMPLOYEES AS TO THE LEGAL SUFFICIENCY,
LEGAL EFFECT, OR TAX CONSE- QUENCES OF THIS LEASE OR THE TRANSACTION TO WHICH IT
RELATES; THE PARTIES SHALL RELY SOLELY UPON THE ADVICE OF THEIR OWN COUNSEL AS
TO THE LEGAL AND TAX CONSEQUENCES OF THIS LEASE. IF THE SUBJECT PROPERTY IS IN A
STATE OTHER THAN CALIFORNIA, AN ATTORNEY FROM THE STATE WHERE THE PROPERTY IS
LOCATED SHOULD BE CONSULTED.
The parties hereto have executed this Lease at the place and on the dates
specified above their respective signatures.
Executed at: Santa Monica, California Executed at: ▇▇▇▇▇▇▇ Oaks, CA
On: May 8, 1998 on: 5/4/98
Fed. ID # ▇▇-▇▇▇▇▇▇▇
By LESSOR: By LESSEE:
BRADMORE REALTY INVESTMENT COMPANY, LTD. DCH TECHNOLOGY, INC., a California
Corporation
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇ By: /s/ ▇. ▇. ▇▇▇▇▇▇▇▇▇
Name printed: ▇▇▇▇ ▇. ▇▇▇▇ Name Printed: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: General Partner Title: President
By: By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name Printed: Name Printed: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Title: Vice President - Operations
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Address: ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ #▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
BROKER: BROKER:
▇.▇. ▇▇▇▇▇▇▇ & Associates
Executed at: Valencia, CA Executed at:
On: 5-5-98 On:
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ By:
Name Printed: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ Name Printed:
Title Senior Vice President Title:
Address: Address:
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ Telephone:
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ Facsimile:
NOTE: These forms are often modified to meet changing requirements of law and
needs of the industry. Always write or call to make sure you are utilizing the
most current form: AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇ 90017.(213) 687-8777.
ADDENDUM TO
STANDARD INDUSTRIAL LEASE
DATE: April 28, 1997
BY AND BETWEEN: BRADMORE REALTY INVESTMENT COMPANY, LTD.,AS LESSOR,
AND DCH TECHNOLOGY, INC., a California corporation, AS LESSEE.
56. Lessor's Option to Cancel on Assignment or Sublease by Lessee
(a) In the event that Lessee or any sublessee or assignee of Lessee (all
hereinafter referred to as "Lessee"), shall intend to sublet all or a portion of
the Premises (which portion is more than 40% of the square footage in any
building on the Premises or more than 40% of the entire Premises and which
sublease is for more than a one year term including options) or assign its
interest under this Lease then Lessee shall give to Lessor written notice of
such intent (hereinafter 'Notice of Intent") in strict accordance with the
procedures hereinafter set forth.
(b) Lessee's Notice of Intent shall set forth the date (hereinafter
"Termination Date") upon which it is intended that a proposed sublease or
assignment would become effective. The Termination Date shall not be less than
ninety days nor more than one hundred twenty days from the date that Lessor
receives the Notice of Intent. Within twenty days after Lessors receipt of the
Notice of Intent, Lessor may give written notice to Lessee that Lessor elects to
terminate this Lease effective as of the Termination Date. If Lessor shall elect
to terminate this Lease, then neither Lessor nor Lessee shall be liable to the
other for any reason having to do with this Lease from and after the Termination
Date except for matters which may have arisen prior to termination and
obligations of Lessee that exist upon termination.
(c) In the event that Lessor does not exercise its right to terminate this
Lease and in the event that Lessee does not in fact execute a final and binding
sublease or assignment within one hundred twenty days after said Termination
Date, then Lessee shall be obligated to give another Notice of Intent to Lessor
before Lessee may assign or sublease and the terms of this addendum shall
reapply. The failure of Lessor to exercise its right to terminate this Lease
under this paragraph shall not be deemed a waiver of the right to subsequently
terminate this Lease in accordance with the terms hereof, and this option to
cancel shall continue to exist during the entire term of this Lease and any
extension thereof.
(d) Lessor's failure to exercise its option to cancel this Lease, shall not
be deemed a waiver of Lessor's right to approve or disapprove of any assignment
or subletting as provided for in paragraph 12.1 of this Lease.
57. Additional HVAC Allowance. Lessor will provide Lessee with a "Additional
HVAC Allowance" of not to exceed $4,000.00,to be used for the installation of
additional heating, ventilating, and air conditioning ("Additional HVAC") in the
Premises. The Lessee will be responsible for employing and supervising all
contractors and subcontractors required to accomplish the Additional HVAC
installation. All costs of the Additional HVAC in excess of the Additional HVAC
Allowance will be paid by Lessee. The Additional HVAC Allowance will Include the
cost of any removal as well as the cost of now HVAC systems. Payment of the
Additional HVAC Allowance or parts thereof will be made by Lessor upon receipt
of approved invoices and mechanic lien releases from Lessee. Checks issued will
be jointly payable to Lessee and Lessee's contractor and/or material men.
ADDENDUM TO STANDARD INDUSTRIAL LEASE
DATE: April 28, 1997
BY AND BETWEEN: BRADMORE REALTY INVESTMENT COMPANY, LTD.,AS LESSOR,
AND DCH TECHNOLOGY, INC., a California corporation, AS LESSEE.
Paragraph 58.
A. OPTION(S) TO EXTEND:
Lessor hereby grants to Lessee the option to extend the term of this Lease for 2
additional 36 month period(s) commencing when the prior term expires upon each
and all of the following terms and conditions:
(1) In order to exercise an option to extend, Lessee must give written notice
of such election to Lessor and Lessor must receive the same at least 6 but not
more than 9 months prior to the date that the option period would commence, time
being of the essence. If proper notification of the exercise of an option--is
not given and/or received, such option shall automatically expire. Options (if
there are more than one) may only be exercised consecutively.
(ii) The provisions of paragraph 39, including those relating to Lessee's
Default set forth in paragraph 39.4 of this Lease, are conditions of this
Option.
(iii) Except for the provisions of this Lease granting an option or options to
extend the term, all of the terms and conditions of this Lease except where
specifically modified by this option shall apply.
(iv) This Option 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 without the intention of
thereafter assigning or subletting.
(v) The monthly rent for each month of the option period shall be calculated
as follows, using the method(s) indicated below: (Check Method(s) to be Used and
Fill in Appropriately)
1. Cost of Living Adjustment(s) (COLA)
a. On (Fill in COLA Dates): June 1, 2002, June 1, 2004, June 1, 2005 and at the
beginning of each twelve (12) month period thereafter the Base Rent shall be
adjusted by the change, if any, from the Base amount specified below, in the
Consumer Price Index of the Bureau of Labor Statistics of the U.S. Department of
Labor for CPI W , for (Fill in Urban Area): Los Anelege - Anaheim - Riverside
All Items (1982-1984 = 100), herein referred to as "CPI"
b. The monthly rent payable in accordance with paragraph A.I.a. of this Addendum
shall be calculated as follows: the Base Rent set forth in paragraph 1.5 of the
attached Lease, shall be multiplied by a fraction the numerator of which shall
be the CPI of the calendar months prior to the month(s) specified in paragraph
A.I.a. above during which the adjustment is to take effect, and the denominator
of which shall be the GPI of the calendar month which is two months prior to MRV
Adjustment Date. The sum so calculated shall constitute the new monthly rent
hereunder, but in no event, shall any such new rent be less than the rent
payable for the month immediately preceding the rent adjustment.
C. In the event the compilation and/or publication of the CPI shall be
transferred to any other governmental department or bureau or agency or shall be
discontinued, then the index most nearly the same as the CPI shall be used to
make such calculation. In the event that the Parties cannot agree on such
alternative index, then the matter shall be submitted for decision to the
American Arbitration Association in accordance with the then rules of said
Association and the decision of the arbitrators shall be binding upon the
parties. The cost of said Arbitration shall be paid equally by the Parties.
II. Market Rental Value Adjustment(s) (MRV)
a. On (Fill in MRV Adjustment Date(s)) June 1 2001, June 1 2004 the Base
Rent shall be adjusted to t e "Market Rental Value" of the property as follows:
1) Four months prior to each Market Rental Value Adjustment Date described
above, the Parties shall attempt to agree upon what the new MRV will be on the
adjustment date. If agreement cannot be reached, within thirty days, then:
(a) Lessor and Lessee shall immediately appoint a mutually acceptable appraiser
or broker to establish the new MRV within the next thirty days. Any associated
costs will be split equally between the Parties, or
(b) Both Lessor and Lessee shall each immediately make a reasonable
determination of the MRV and submit such determination, in writing, to
arbitration in accordance with the following provisions:
(1) Within fifteen days thereafter, Lessor and Lessee shall each select an
appraiser ("Consultant") of their choice to act as an arbitrator. The two
arbitrators so appointed shall immediately select a third mutually acceptable
Consultant to act as a third arbitrator.
ADDENDUM TO STANDARD INDUSTRIAL LEASE
DATE: April 28, 1997
BY AND BETWEEN: BRADMORE REALTY INVESTMENT COMPANY, LTD.,AS LESSOR,
AND DCH TECHNOLOGY, INC., a California corporation, AS LESSEE.
(ii) The three arbitrators shall within thirty days of the appointment of the
third arbitrator reach a decision as to what the actual MRV for the Premises is,
and whether Lessors or Lessee's submitted MRV is the closest thereto. The
decision of a majority of the arbitrators shall be binding on the Parties. The
submitted MRV which is determined to be the closest to the actual MRV shall
thereafter be used by the Parties.
(111) If either of the Parties falls to appoint an arbitrator within the
specified fifteen days, the arbitrator timely appointed by one of them shall
reach a decision on his or her own, and said decision shall be binding on the
Parties.
(iv) The entire cost of such arbitration shall be paid by the ▇▇▇▇▇ whose
submitted MRV is not selected, la. the one that is NOT the closest to the actual
MRV.
2) Notwithstanding the foregoing, the new MRV shall not be less than the rent
payable for the month immediately preceding the rent adjustment.
b. Upon the establishment of each New Market Rental Value:
1) the new MRV will become the new 'Base Rent' for the purpose of calculating
any further Adjustments, and
2) the first month of each Market Rental Value term shall become the new 'Base
Month' for the purpose of calculating any further Adjustments.
B. NOTICE:
Unless specified otherwise herein, notice of any rental adjustments, other than
Fixed Rental Adjustments, shall be made as specified in paragraph 23 of the
Lease.
ADDEMDUM TO STANDARD INDUSTRIAL LEASE
DATE: April 28, 1997
BY AND BETWEEN: BRADMORE REALTY INVESTMENT COMPANY, LTD.,AS LESSOR,
AND DCH TECHNOLOGY, INC., a California corporation, AS LESSEE.
EXHIBIT A
ADDEMDUM TO STANDARD INDUSTRIAL LEASE
DATE: April 28, 1997
BY AND BETWEEN: BRADMORE REALTY INVESTMENT COMPANY, LTD.,AS LESSOR,
AND DCH TECHNOLOGY, INC., a California corporation, AS LESSEE.
EXHIBIT B
ADDEMDUM TO STANDARD INDUSTRIAL LEASE
DATE: April 28, 1997
BY AND BETWEEN: BRADMORE REALTY INVESTMENT COMPANY, LTD.,AS LESSOR,
AND DCH TECHNOLOGY, INC., a California corporation, AS LESSEE.
EXHIBIT C
C.C.&R.'S
NOTE: The following exhibit is a re-typed copy of the original recorded
documents. The recorder's stamp, signatures of the authorized agents of the
Valencia Company, and the notary's verification the signatures are scanned
copies of the original. The text of the document is retyped but otherwise
unchanged.
ADDEMDUM TO STANDARD INDUSTRIAL LEASE
DATE: April 28, 1997
BY AND BETWEEN: BRADMORE REALTY INVESTMENT COMPANY, LTD.,AS LESSOR,
AND DCH TECHNOLOGY, INC., a California corporation, AS LESSEE.
EXHIBIT D
VALENCIA INDUSTRIAL CENTER
DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS
PREAMBLE
This DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS is made and entered
into as of this 11th day of July, 1985, by VALENCIA,,COMPANY, a division of The
Newhall Land.and Farming Company (a California Limited Partnership), as owner,
of that certain real property located in the County of Los Angeles, State of
California, as more particularly described in Exhibit "A" attached hereto and
incorporated herein by this reference.
The real property described in Exhibit "A" is a part of a larger land area owned
by VALENCIA COMPANY, which is being developed as a planned community, named
Valencia. The real property which is the subject of this DECLARATION OF
COVENANTS, CONDITIONS, AND RESTRICTIONS is known as VALENCIA INDUSTRIAL CENTER.
VALENCIA INDUSTRIAL CENTER is being developed as a planned industrial complex
which will provided employment opportunities for the residents of Los Angeles
County and the surrounding areas. VALENCIA COMPANY intends that the design and
development as well as the continuing use and operations of the real property
subject to this DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS shall be
consistent with the aims and ideals of Valencia. It is the purpose of this
DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS to provide the means for
maintaining and controlling such development and use so that the design and
integrity and amicable environment of Valencia will be maintained. This
DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS, is designed to compliment
local government and municipal regulations and where conflicts occur, it is
intended that the most rigid requirements shall prevail. It is assumed that the
owners and users of industrial sites in the VALENCIA INDUSTRIAL CENTER will be
motivated to preserve these qualities through mutual cooperation and by
enforcing not only the letter but the spirit of this DECLARATION OF COVENANTS,
CONDITIONS AND RESTRICTIONS.
IN WITNESS WHEREOF, VALENCIA COMPANY, has executed this DECLARATION OF
COVENANTS, CONDITIONS AND RESTRICTIONS the day and year first above written.
VALENCIA COMPANY@, A division of The Newhall Land and Farming Company
By
Authorized Agent
By
Authorized Agent
ADDEMDUM TO STANDARD INDUSTRIAL LEASE
DATE: April 28, 1997
BY AND BETWEEN: BRADMORE REALTY INVESTMENT COMPANY, LTD.,AS LESSOR,
AND DCH TECHNOLOGY, INC., a California corporation, AS LESSEE.
EXHIBIT D
STATE OF CALIFORNIA
COUNTY OF LOS ABGELES
On this 11th Day of July, 1985, before the undersigned a notary public in and
for the State of California personally appeared ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇, the authorized agents, respectively of VALENCIA COKPANY a Division of
THE NEWHALL LAND AND FARMING COMPANY (a California Limited Partnership),
personally known to be (or proved to me on the basis of satisfactory evidence)
to be the persons who executed the within instrument on behalf of VALENCIA
COTAPANY, the division that executed the within instrument on behalf of said
partnership, and acknowledged to me that VALENCIA COMPANY executed the same on
behalf of said partnership and acknowledged to me that; said VALENCIA COMPANY
and said partnership executed the same pursuant to the Limited Partnership
Agreement of said partnership.
WITNESS MY HAND AND OFFICIAL SEAL
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
NOTARY PUBLIC IN AND FOR SAID STATE
LCO ANCEUS COU#M
ADDEMDUM TO STANDARD INDUSTRIAL LEASE
DATE: April 28, 1997
BY AND BETWEEN: BRADMORE REALTY INVESTMENT COMPANY, LTD.,AS LESSOR,
AND DCH TECHNOLOGY, INC., a California corporation, AS LESSEE.
EXHIBIT D
ARTICLE I DEFINITIONS
Unless the context otherwise specifies or requires, the terms defined in this
Article I shall, for all purposes for this DECLARATION OF COVENANTS, CONDITIONS
AND RESTRICTIONS have the meanings herein specified.
ARCHITECT The term "Architect" shall mean a person holding a certificate to
practice architecture in the State of California under authority of Division 3,
Chapter 3 of the Business and Professions Code of the State of California, or
under such other sections as may hereafter regulate the practice of architecture
in the State of California.
BENEFICIARY The term "Beneficiary" shall mean a mortgagee under a mortgage, as
well as a beneficiary under a deed of trust.
DECLARANT The term "Declarant" shall mean VALENCIA COMPANY, a division of The
Newhall Land and Farming Company (a California Limited Partnership), and all of
its successors, assigns, or designees who shall assume the obligations provided
for herein, and to whom Declarant shall specifically assign in writing the right
to enforce these restrictions provided for herein.
DECLARATION The term "Declaration" shall mean this DECLARATION OF COVENANTS,
CONDITIONS, AND RESTRICTIONS.
DEED OF TRUST The term "Deed of Trust" or "Trust Deed" shall mean a mortgage as
well as a deed of trust.
FILE The term "File" shall mean, with reference to any subdivision map, the
filing of said map in the Office of the Recorder of the County of Los Angeles,
State of California.
IMPROVEMENTS The term "Improvements" shall include buildings 'outbuildings,
roads, driveways, parking areas, fences, screening walls and barriers, retaining
walls, stairs, decks, ▇▇▇▇▇▇, windbreaks, plantings, planted trees and shrubs,
poles, signs, loading areas and all other structures or landscaping improvements
of every type and kind, and any replacements, additions, repairs or alterations
thereto of any kind whatsoever.
OWNER The term owner shall mean each and every owner of the real property or any
portion thereof or interest therein during the term of its ownership and each
lessee or other occupant in possession thereof as may be appropriate under the
context.
MORTGAGEE The term "Mortgagee" shall mean a beneficiary under, or a holder of a
deed of trust as well as a mortgage.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇(▇) ▇▇▇ ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇) The term "Office Building(s) and
High-Tech Building(s)" shall mean buildings improved with a high percentage of
offices and/or suites, used primarily for non-warehousing types of purposes and
requiring a substantially greater amount of parking than buildings) used
primarily for warehousing types of purposes.
REAL PROPERTY The term "Real Property" shall mean all or any portion of the
property subject to the terms and provisions of the Declaration, including the
real property described in Exhibit "A" attached hereto and such additional
property that shall from time to time hereafter become subject to the
Declaration, in accordance with the provisions contained in Section 2.2
hereafter.
RECORD; RECORDED The term "Record" shall mean, with respect to any document, the
recordation of said document in the Office of the County Recorder of the County
of Los Angeles, State of California.
SITE The term "Site" shall mean an area of land shown as one lot on a recorded
subdivision map or so designated in a deed or lease in which Declarant is the
grantor or lessor included within the real property described in Exhibit "A" or
added thereof pursuant to Article 11 hereafter. If an easement or easements over
any portion or portions of a Site established by recorded plan or recorded
instrument is or are reserved by Declarant for any purpose whatsoever, the area
of such portion or portions shall be included in computing the area of that
Site. If subsequent to the establishment of a Site by recorded plan or recorded
instrument, any portion or portions thereof are, for railroad, street, highway,
utility or public purpose, taken by right of eminent domain, or deed in lieu
thereof, or dedicated or conveyed pursuant to reservation by Declarant, the area
of such portion or portions shall continue to be included thereafter in
computing the area of that Site.
SUBDIVISION The term "Subdivision" shall mean the division of any Site or Sites
of improved or unimproved property, or any portion thereof, shown on the latest
equalized county assessment roll as a unit or as contiguous units, for the
purpose of sale, lease, or financing whether immediate or future, in accordance
with the terms and provision of the Subdivision Map Act contained in Section
6641 0 et seq of the California Government Code, and the Los Angeles County
Subdivision Ordinance enacted pursuant thereto.
VISIBLE FROM NEIGHBORING SITES The term "Visible from Neighboring Sites" shall
mean, with respect to any given object, that such object is or would be visible
to a person six feet tall, standing on any part of such neighboring Sites at an
elevation no greater than the elevation of the base of the object being viewed.
VALENCIA INDUSTRIAL CENTER The term "Valencia Industrial Center" shall mean all
of the real property now or hereafter made subject to the DECLARATION.
VALENCIA INDUSTRIAL CENTER RESTRICTIONS The term "Valencia Industrial Center
Restrictions" shall mean the covenants, conditions, and restrictions set forth
in this DECLARATION, as it may from time to time be amended and supplemented.
ARTICLE II
PROPERTY SUBJECT TO THE VALENCIA INDUSTRIAL CENTER RESTRICTIONS
SECTION 2.1 GENERAL DECLARATION CREATING VALENCIA
INDUSTRIAL CENTER
DECLARANT hereby declares that all of the real property located in the County of
Los Angeles, State of California, described in Exhibit "A", which is attached
hereto and incorporated herein by this reference, is and shall be, conveyed,
hypothecated, encumbered, leased, occupied, built upon or otherwise used,
improved or transferred in whole or in part subject to the VALENCIA INDUSTRIAL
CENTER RESTRICTIONS, meaning the covenants, conditions and restrictions set
forth in this DECLARATION. All of said covenants, conditions and restrictions
are declared and agreed to be in furtherance of a general plan for the
subdivision, improvement and sale of said real property and are established for
the purpose of enhancing and perfecting the value, desirability and
attractiveness of said real property and every part thereof. All of the VALENCIA
INDUSTRIAL CENTER RESTRICTIONS shall run with all of said real Property for all
purposes and shall be binding upon and inure to the benefit of DECLARANT and all
owners, lessees, licensees, occupants and their successors in interest as set
forth in this DECLARATION.
SECTION 2.2 ADDITION OF OTHER PROPERTY OWNED BY DECLARANT
A. DECLARANT'S POWER Declarant may at any time during the pendency of this
DECLARATION add all or any portion of any property now or hereafter owned by
DECLARANT to the real property which is covered by this DECLARATION, AND UPON
RECORDING OF A NOTICE OF ADDITION OF PROPERTY CONTAINING AT LEAST THE PROVISIONS
SET FORTH IN SECTION 2.2B OF THIS ARTICLE 11, THE PROVISIONS OF THIS DECLARATION
specified in said notice shall apply to such added property in the same manner
as if it were originally covered by this DECLARATION. Thereafter, to the extent
this DECLARATION is made applicable thereto, the rights, powers and
responsibilities of DECLARANT and the owners, lessees, licensees and occupants
of Sites within such added property shall be the same in the case of the real
property described in Exhibit "A".
B. NOTICE OF ADDITION OF PROPERTY The notice of addition of real property
referred to in Section 2.2A above shall contain at least the following
provisions:
1. A reference to this DECLARATION stating the date of recording hereof and
the book or books of the records of Los Angeles County, California, and the page
numbers where this DECLARATION is recorded;
2. A statement that the provisions of this DECLARATION, or some specified part
thereof, shall apply to such added property;
3. An exact description of such added property, and
4. Such other or different covenants, conditions and restrictions as DECLARANT
shall, in its discretion, specify to regulate and control the use, occupancy and
improvement of such added property.
SECTION 2.3 SUBDIVISION OF SITES
There shall be no subdivision of any Site subject to the Valencia Industrial
Center Restrictions without the prior written consent to Declarant which consent
Declarant may withhold for any reason Declarant in its sole discretion deems
reasonable. In addition, further subdivision or division of any Site shall not
serve to make the parts into which such Site is subdivided themselves Sites for
the purposes hereof in such instances where the prior written approval of the
DECLARANT has not been received. The restrictions contained in the Valencia
Industrial Center Restrictions shall, in such events, remain applicable to the
entire Site as originally defined for the duration hereof.
ARTICLE III REGULATIONS OF IMPROVEMENTS
SECTION 3.1 APPROVAL OF PLANS
No Improvements of any nature whatsoever (including but not limited to any
alteration or addition to any Improvements existing from time to time) shall be
constructed, erected, placed, altered, maintained or permitted to remain on any
Site subject to this DECLARATION until final plans and specifications showing
the plot layout, all ingress and egress for persons and vehicles, all vehicle
parking, all exterior elevations with materials and colors therefor, exterior
signs, exterior hardscape, landscape, and irrigation, walls and fences, shall
have first been submitted to and approved in writing by DECLARANT. Such final
plans and specifications shall be submitted in writing in duplicate over the
authorized signature of the owner, lessee, licensee or other occupant of the
Site or his authorized agent. Under no circumstances shall the DECLARANT approve
metal-clad buildings of any type or design. All roof equipment including but not
limited to heating, air-conditioning and ventilation equipment, antennas and
communication equipment shall be so located or screened so as not to be visible
from neighboring sites and or adjacent streets. Changes in approved plans which
materially affect building size, placement or external appearances shall
similarly be submitted to and approved by DECLARANT.
SECTION 3.2 BASIS FOR APPROVAL
Architectural Guidelines as may be amended from time to time to assist in the
design and development of an individual Site within Valencia Industrial Center
shall be made available from Declarant. Approval by Declarant of Plans and
Specifications shall be based, among other things on Site plot plan dimensions,
landscaped areas, and building design in conformity and harmony of external
design with neighboring structures; effect of location and use of proposed
improvements on neighboring Sites; the nature of improvements on neighboring
Sites and the types of operations and uses thereof; relation of topography,
grade and finish ground elevation of the Site being approved to that of
neighboring Sites; proper facing of main elevation with respect to nearby
streets and conformity of the plans and specifications to the purpose and
general plan and intent of this DECLARATION. DECLARANT shall not arbitrarily or
unreasonably withhold its approval of such plans and specifications.
SECTION 3.3 RESULT OF INACTION
If DECLARANT fails either to approve or disapprove such plans and specifications
within thirty (30) days after the same have been submitted to it, it shall be
conclusively presumed that DECLARANT has approved said plans and specifications;
provided, however, that if within said thirty (30) day period, DECLARANT gives
written notice of the fact that a reasonable additional period is required for
the approval of such plans and specifications, there shall be no presumption
that the same are approved until the expiration of the extended period set forth
in said notice.
SECTION 3.4 PROCEEDING WITH WORK
Upon receipt of approval of plans and specifications from DECLARANT pursuant to
this section, the owner or lessee to whom the same is given shall, as soon as
practicable, satisfy all conditions thereof and diligently proceed with the
commencement and completion of all approved construction, refinishing,
alterations and excavations. In all cases work shall be commenced within one
year from the date of such approval. If there is a failure to comply with this
paragraph, then the approval given pursuant to this section shall be deemed
revoked unless DECLARANT upon request made prior to the expiration of said one
year period extends the time for commencing work.
SECTION 3.5 COMPLETION OF WORK
In any event completion, reconstruction, refinishing or alteration of any such
improvement shall be within two years after commencement thereof except for so
long as such completion is rendered impossible or would result in great hardship
due to strikes, fires, national emergencies, natural calamities or other
supervening forces beyond the control of the owner, lessee, licensee or occupant
or his agents and of a non-financial nature. Failure to comply with this
paragraph shall constitute a breach of the VALENCIA INDUSTRIAL CENTER
RESTRICTIONS and subject the defaulting party or parties to all enforcement
procedures set forth in this a DECLARATION and any other remedies provided by
law or in equity.
SECTION 3.6 ESTOPPEL CERTIFICATE
Within thirty (30) days after written demand is delivered to the DECLARANT and
upon payment of a reasonable fee established by DECLARANT, there shall be
recorded an estoppel certificate executed by DECLARANT and certifying that as of
the date thereof either (a) all improvements made or other work done on or
within a Site complies with the VALENCIA INDUSTRIAL CENTER RESTRICTIONS or (b)
such improvements or work do not comply in which event the certificate shall
identify the non-complying improvements or work and set forth with particularity
the cause or causes for such non-compliance. Any lessee, purchaser or
encumbrancer in good faith for value shall be entitled to rely on said
certificate with respect to the matters set forth therein, such matters being
conclusive as between the DECLARANT and all such subsequent parties in interest.
SECTION 3.7 LIABILITY
DECLARANT shall not be liable for any damage, loss or prejudice suffered or
claimed on account of (a) the approval or disapproval of any plans, drawings and
specifications whether or not defective; (b) the construction or performance of
any work whether or not pursuant to approved plans, drawings and specifications;
(c) the development of any Site within the VALENCIA INDUSTRIAL CENTER; or (d)
the execution and filing of an estoppel certificate pursuant to the preceding
paragraph whether or not the facts therein are correct, provided that DECLARANT
has acted in good faith. In addition to the foregoing, Declarant makes no
representation, warranty or guarantee of any kind whatsoever as to the
propriety, feasibility or integrity of any plans, drawings and specifications
approved by Declarant pursuant to the provisions contained herein.
SECTION 3.8 REVIEW FEE
A reasonable architectural review fee shall be paid to DECLARANT at such time as
plans and specifications are submitted to it for approval. The determination of
the exact amount of such fee shall be made from time to time by Declarant.
ARTICLE IV LIMITATIONS ON IMPROVEMENTS
SECTION 4.1 MINIMUM SETBACK LINES AND BUILDING TYPES
No building or parking (except as expressly provided for in Sections 4.2 and 4.3
below) shall be maintained upon any Site within forty (40) feet of any Street,
and no building shall be maintained within fifteen (15) feet of the property
line of any other Site, nor have exterior walls constructed of other than
substantial construction including concrete and masonry, nor shall more than
fifty percent (50%), of the area of any Site be built upon; nor shall any
building be constructed upon any Site with a roof having a difference in
elevation of more than two (2) feet unless approved in the manner hereinafter
provided.
SECTION 4.2 OFFICE BUILDINGS AND "HIGH TECH" BUILDINGS
Notwithstanding anything to the contrary contained in Section 4.1 above, any
office buildings) and "high-tech" buildings) requiring a greater parking ratio
than standard industrial buildings and whose location on the Site has a
substantial setback from the street, may request a variance of the parking
restriction within the forty (40') feet setback area from any street, provided a
minimum of twenty-five (25') feet from the street curb is mounded or bermed to a
height of not less than four (4') feet and landscaped so as to assure that all
automobile parking within forty (40') feet setback area is hidden from view from
the street. Similarly, owners of Sites bordering dedicated streets on two sides
may likewise request a variance of the forty (40') feet setback area on one
street frontage (that being the street away from the buildings) or improvements)
front) provided a minimum of twenty-five (25') feet from the street curb is
mounded or bermed to a height of not less than four (4') feet and landscaped so
as to assure that all automobile parking within the forty (40') feet setback
area is hidden from view from the street. Nothing indicated herein shall be
construed so to permit the granting of a variance providing for a landscaped
setback area of less than twenty-five (25') feet within the Valencia Industrial
Center.
SECTION 4.3 USE OF SETBACK AREAS
Within the required setback area from streets there shall be maintained on each
Site only paved walkways, paved driveways (hardscape), and lawns and
landscaping, with the surface of each Site not covered by improvements being at
all times maintained so as to be dust free. At least two-thirds (2/3) of the
surface of the required setback area from streets shall be maintained in
landscaping.
SECTION 4.4 LANDSCAPING
Every Site on which a building shall have been placed shall have landscape and
exterior hardscape constructed in accordance with plans and specifications
submitted to and approved by DECLARANT pursuant to Section 3.1 above. With the
exception of those areas planted in shrubs or trees, the landscaped areas shall
be maintained in grass lawn or approved ground cover. Landscaping and hardscape
as approved by DECLARANT shall be installed within thirty (30) days of occupancy
or completion of the building, whichever occurs first, unless DECLARANT approved
in writing another completion date. After completion such landscaping and
hardscape shall at all times be maintained in an attractive and well-kept
condition.
SECTION 4.6 DRAINAGE
No water shall be drained or discharged from any Site or Improvements thereon,
and no Owner shall interfere with the drainage established as of the date of
this Declaration, in or over the remainder of the real property or any other
property adjacent to such Site, except in accordance with plans therefor
approved by all public agencies having jurisdiction; provided that no water
shall be drained or discharged at any time onto or diverted from any adjacent
properties owned by the Declarant.
SECTION 4.6 SIGNS
A. No signs projecting above the highest point on the roof line of any
building or employing letters exceeding four (4) feet in height shall be used.
No more than two business identification signs shall be used on any Site and no
signs shall be painted on any structure. No flashing or moving lights shall be
used.
B. No signs shall be permitted other than those identifying the name, business
and products of the person or firm occupying the premises constructed on any
Site and those offering the premises for sale or for lease. The size and style
of sale or lease signs shall first be approved by DECLARANT in writing. No more
than one sign relating to the sale or leasing of the Site may be used, and such
sign shall not exceed fifteen (15) square feet. Monument signs identifying each
building shall be encouraged however, the design, colors, materials and size
shall first be approved by DECLARANT.
C. Notwithstanding anything to the contrary contained in this Section 4.6,
multi-tenant buildings shall be permitted one Tenant Directory sign for each
building. Said sign shall not exceed twelve (12) square feet and shall be
approved by DECLARANT in writing as to design, color and location of the sign on
each Site.
D. The location of all signs shall first be approved by DECLARANT.
E. Signs and identifying markings on buildings or building Sites shall only be
of such size, design and color as is first specifically approved by DECLARANT in
writing.
SECTION 4.7 PARKING AREAS
Adequate off-street parking shall at all times be provided to accommodate all
parking needs for employee, visitor and company vehicles on the Site. The intent
of this provision is to eliminate the need for any on-street parking. No use
shall be made of any Site at anytime which will attract parking in excess of the
parking spaces then available thereon.
SECTION 4.8 STORAGE AND LOADING AREAS
A. Unless specifically approved by DECLARANT in writing, no materials,
supplies or equipment, including company- owned or operated trucks, mobile
homes, boats, trailers, or recreation vehicles, shall at any time be stored in
any area on a Site except inside a closed building, or behind a visual barrier
screening such areas so that they are not visible from the neighboring Sites or
public streets. Visual barrier screening to a height of not more than eight (8)
feet shall be permitted only with the prior written approval of DECLARANT.
B. Loading areas shall not encroach into setback areas.
C. Loading docks shall be set back and screened to minimize the effect of
their appearance from the street and so as not to be visible from neighboring
Sites. Docks shall not be closer than seventy (70) feet to the street property
line, unless specifically approved by DECLARANT in writing. Loading shall be
permitted to the rear of the setback line from that portion of a structure not
fronting a street.
SECTION 4.9 FENCING AND SCREENING OF STORAGE AREAS
All areas requiring fencing shall be enclosed with a minimum six foot (6') high
and maximum eight foot (8') high masonry wall, such as slumpstone, split face
block wall with cap or brick. Chain link fence shall be prohibited throughout
the VALENCIA INDUSTRIAL CENTER. Gate construction shall be of wrought iron or
other materials first approved by DECLARANT.
SECTION 4.10 SCREENING - TRASH AREA
All trash areas shall be enclosed with a minimum six foot (6') high masonry
wall, such as slumpstone, split face block wall with cap, or brick. All trash
enclosures shall have blinds or gates. Chain link gates shall only be permitted
if faced with wooden slats so as to obscure view of trash containers. No trash
containers or bins shall be maintained on any Site unless contained within a
masonry trash enclosure.
ARTICLE V
REGULATION OF OPERATIONS AND USES
SECTION 5.1 PERMITTED USES
Each Site shall only be used for manufacturing, processing, storage, wholesale,
of f ice, laboratory, professional, research and development activities and/or
other like uses which are permitted by the applicable zoning designation; No
junk or salvage yard or any other use offensive to the neighborhood by reason of
order, fumes, dust, smoke, noise, or pollution or hazardous by reason of danger
of fire or explosion, radiation, electromagnetic disturbances, toxic or non-
toxic matter shall be permitted regardless of whether or not permitted by
applicable zoning laws or ordinances.
SECTION 5.2 RESTRICTIONS AND PROHIBITED USES
A. PROHIBITED USES The following are examples of operations and uses which
shall specifically not be permitted on any Site subject to the Valencia
Industrial Center Restrictions
1. Residential
2. Commercial
3. Restaurants of all types
4. Trailer Courts
5. Labor Camps -
6. Junk Yards
7. Drilling for and/or the removal of oil, gas or other hydrocarbon substances
(except that this provision shall not be deemed to prohibit the entry of subject
property below a depth of 500 feet for such purposes)
8. Commercial excavation of building or construction materials
9. Distillation of bones
10. Dumping, disposal, incineration or reduction of garbage, sewage, offal,
dead animals or refuse
11. Fat Rendering
12. Stockyard or ▇▇▇▇▇▇▇▇▇ of Animals
13. Refining of Petroleum or of its Products
14. Smelting of Iron, Tin, Zinc, or other Ores
15. Cemeteries
16. Jail or Honor Farms
17. Any and all operations and uses not compatible or harmonious with the
establishment and maintenance of a high quality industrial park.
B. NUISANCES No rubbish or debris of any kind shall be placed or permitted to
accumulate upon or adjacent to any Site, and no orders shall be permitted to
arise therefrom so as to render any Site or portion thereof unsanitary,
unsightly, offensive or detrimental to any Site or property in the vicinity
thereof or to the occupants thereof. No nuisance shall be permitted to exist or
operate upon any Site so as to be offensive or detrimental to any property in
the vicinity thereof or to its occupants.
C. MAINTENANCE AND REPAIRS OF IMPROVEMENTS Each Site and all Improvements
thereon shall at all times be constructed, kept and maintained in first class
condition, repair and appearance similar to that maintained by DECLARANT and
other owners of high-class properties of similar class and construction in Los
Angeles County, ordinary wear and tear expected. All repairs, alterations,
replacements, or additions to Improvements shall be at least equal to the
original work in class and quality. The necessity and adequacy of such repairs
shall be measured by the same standard as set forth above for the original
construction and maintenance. Each owner shall also be responsible at all times
for determining that all Improvements and the plans and specifications therefor
shall conform and comply in all respects with the VALENCIA INDUSTRIAL CENTER
RESTRICTIONS, all other restrictions of record, all applicable governmental
regulations, and all exterior architectural design, location and color
specifications as may be approved by DECLARANT. Each Owner shall also adopt and
maintain such standards of property space maintenance, appearance, and
housekeeping as shall be reasonable and customary for similar operations or
enterprises and shall enforce compliance with such standards by all tenants,
occupants, or users of space. On request, DECLARANT shall be entitled to receive
copies of all such standards or similar rules or regulations in effect from time
to time. Notwithstanding anything to the contrary contained in the foregoing all
exterior surfaces shall be maintained in first-class condition and shall be
repainted at least once in every four (4) years.
D. MAINTENANCE OF UNIMPROVED SITES Each and every Site shall be maintained at
all times in a weed-free, clean and presentable condition prior to such Site
being improved with buildings and landscaping.
E. RIGHT OF ENTRY During reasonable hours, and subject to reasonable security
requirements, DECLARANT, or its authorized representative, shall have the right
to enter upon and inspect any Site and the improvements thereon embraced for the
purpose of ascertaining whether or not the provisions of the VALENCIA INDUSTRIAL
CENTER RESTRICTIONS have been or are presently being complied with and shall not
be deemed guilty of trespass by reason of such entry.
SECTION 5.3 OTHER OPERATIONS AND USES
Operations and uses which are neither specifically prohibited nor specifically
authorized by VALENCIA INDUSTRIAL CENTER RESTRICTIONS shall be permitted in a
specific case only if operational plans and specifications are first submitted
to and approved in writing by DECLARANT. Approval or disapproval of such
operational plans and specifications shall be based upon the effect of such
operations or uses on other Sites subject to these restrictions or upon the
occupants thereof, but shall be in the sole discretion of DECLARANT.
ARTICLE VI
DURATION, MODIFICATION AND REPEAL
SECTION 6.1 DURATION OF RESTRICTIONS
The VALENCIA INDUSTRIAL CENTER RESTRICTIONS shall continue and remain in full
force and effect at all times with respect to all Sites included in the VALENCIA
INDUSTRIAL CENTER and each part thereof, now or hereafter made subject thereto
(subject, however, to the right to amend and repeal as provided for herein)
until January 1, 2015. However, unless within one year prior to January 1, 2015,
there shall be recorded an instrument directing the termination of the VALENCIA
INDUSTRIAL CENTER RESTRICTIONS signed by owners of not less than two-thirds of
the area of the real property then subject to the VALENCIA INDUSTRIAL
RESTRICTIONS, (based on the number of square feet of real property subject to
the VALENCIA INDUSTRIAL CENTER RESTRICTIONS), the VALENCIA INDUSTRIAL CENTER
RESTRICTIONS, as in effect immediately prior to the expiration date shall be
continued automatically without any further notice for an additional period of
ten (10) years and thereafter for successive periods of ten (10) years unless
within one (1) year prior to the expiration of any such period the VALENCIA
INDUSTRIAL CENTER RESTRICTIONS are terminated as set forth above in this
Section.
SECTION 6.2 TERMINATION AND MODIFICATION
This DECLARATION, or any provision hereof, or any covenant, condition or
restriction contained herein, may be terminated, extended, modified or amended,
as to the whole of the real property or any portion thereof, with the written
consent of the owners of seventy-five (75%) of the area of the real property
subject to the VALENCIA INDUSTRIAL CENTER RESTRICTIONS, based on the number of
square feet of real property owned as compared to the total number of square
feet of real property subject to the VALENCIA INDUSTRIAL CENTER RESTRICTIONS,
provided, however, that so long as DECLARANT owns at least twenty-five percent
(25%) of the real property subject to the VALENCIA INDUSTRIAL CENTER
RESTRICTIONS, or for a period of fifteen (15) years from the effective date
hereof, whichever period is longer, no-such termination, extension, modification
or amendment shall be. effective without the written approval of DECLARANT
thereto. No such termination, extension, modification or amendment shall be
effective until a proper instrument in writing has been executed and
acknowledged and recorded in the County where the real property affected thereby
is situated.
ARTICLE VII
ENFORCEMENT
SECTION 7.1 ABATEMENT AND SUIT
The conditions, covenants, restrictions and reservations herein contained shall
run with the real property, and shall be binding upon the inure to the benefit
of the DECLARANT, and the Owners of every Site on the real property. These
conditions, covenants, reservations and restrictions may be enforced as provided
hereinafter by DECLARANT acting for itself or as DECLARANT acting as trustee, on
behalf of all of the Owners of Sites. Each Owner by acquiring an interest in a
Site shall appoint irrevocably the DECLARANT as its attorney-in-fact for such
purposes; provided, however that if an Owner of a Site notified DECLARANT of a
claimed violation of these conditions, covenants, restrictions and reservations
in writing and DECLARANT fails to act within sixty (60) days after receipt of
such notification, then, and in that event only, an Owner may separately, at its
own cost and expense, enforce the conditions, covenants, restrictions and
reservations herein contained and have all of the remedies provided for in
Section 7.2 hereafter.
SECTION 7.2 DEFAULT ANID REMEDIES
In the event of any breach, violation or failure to perform or satisfy any of
the VALENCIA INDUSTRIAL CENTER RESTRICTIONS which has not been cured within
thirty (30) days after written notice from DECLARANT to do so, DECLARANT in its
sale option and discretion may enforce any one or more of the following remedies
or any other rights or remedies to which DECLARANT may be entitled by law or
equity, whether or not set forth herein. All remedies provided for herein or by
law or in equity shall be cumulative and not mutually exclusive.
A. DAMAGES DECLARANT may bring a suit for damages for any compensable breach
of or noncompliance with any of the VALENCIA INDUSTRIAL CENTER RESTRICTIONS, or
declaratory relief to determine the enforceability of any of the VALENCIA
INDUSTRIAL CENTER RESTRICTIONS.
B. EQUITY It is recognized that a violation by an Owner of one or more of the
foregoing restrictions may cause DECLARANT to suffer material injury or damage
not compensable in money and that DECLARANT shall be entitled to bring an action
in equity or otherwise for specific performance to enforce compliance with the
VALENCIA INDUSTRIAL CENTER RESTRICTIONS or an injunction to enjoin the
continuance of any such breach or violation thereof.
C. ABATEMENT AND LIEN RIGHTS Any such breach or violation of the VALENCIA
INDUSTRIAL CENTER RESTRICTIONS or any provision hereof is hereby declared to be
a nuisance, and DECLARANT shall be entitled to enter the Site or any portion
thereof as to which the breach or violation exists and summarily ▇▇▇▇▇ and
remove, without further legal process to the maximum extent permitted by law,
any structure, thing or condition that may exist in violation of any of the
VALENCIA INDUSTRIAL CENTER RESTRICTIONS, or to prosecute any remedy allowed by
law or equity for the abatement of such nuisance against any person or entity
acting or failing to act in violation of the VALENCIA INDUSTRIAL CENTER
RESTRICTIONS, all at the sole cost and expense of Owner or any person having
possession under Owner. Any costs or expenses paid or incurred by DECLARANT in
abating such nuisance or prosecuting any such remedy (including all reasonable
attorneys' fees and costs of collection), together with interest thereon at the
maximum rate permitted by law shall be a charge against the Site or any portion
thereof as to which the breach or violation exists, shall be a continuing lien
thereon until paid, and shall also be the personal obligation of that person or
entity who was Owner when such charges became due and committed such breach or
violation. In addition to any other rights or remedies hereunder, DECLARANT may
deliver to Owner and record with the Los Angeles County Recorder a certificate
or notice to claim of lien (which, among other things may but need not recite
the nature of the violation, the legal description of the Site or portion
thereof affected by such violation, the record or reputed Owner thereof,
DECLARANT'S name and address, and the remedies being pursued or the amount of
any such claim being changed). If the violation recited in such lien claim has
not been cured to DECLARANT'S satisfaction and any recited amounts so charged
have not been paid within 30 days thereafter, DECLARANT or DECLARANT'S
authorized representatives may foreclose such lien by a sale conducted pursuant
to Sections 2924, 2924b, and 2924c of the California Civil Code, as amended from
time to time, or such other statutes applicable to the exercise of powers of
sale in mortgages or deeds of trust, or in any other manner permitted by law.
DECLARANT, through its authorized representatives, may bid on and acquire any
Site or portion thereof subject to such lien at any such foreclosure sale. If
the violations recited in such lien claim are timely cured and any recited
amounts timely paid as provided above, an appropriate release of such lien shall
be recorded by DECLARANT at Owner's sole cost and expense.
SECTION 7.3 WAIVER
No waiver by DECLARANT of a breach of any of the VALENCIA INDUSTRIAL CENTER
RESTRICTIONS and no delay or failure to enforce any of the VALENCIA INDUSTRIAL
CENTER RESTRICTIONS shall be construed or held to be a waiver of any succeeding
or preceding breach of the same or any other of the VALENCIA INDUSTRIAL CENTER
RESTRICTIONS by that Owner of any other Owner of the Site, or any other Site. No
waiver by DECLARANT of any breach or default hereunder shall be implied from any
omission by DECLARANT to take any action on account of such breach or default if
such breach or default persists or is repeated, and no express waiver shall
affect a breach or default other than as specified in said waiver. The consent
or approval by DECLARANT to or of any act by an Owner requiring DECLARANT'S
consent or approval shall not be deemed to waive or render unnecessary
DECLARANT'S consent or approval to or of any subsequent similar acts by Owner.
SECTION 7.4 COSTS OF ENFORCEMENT
In the event any legal or equitable action or proceeding shall be instituted to
enforce any provision of the VALENCIA INDUSTRIAL CENTER RESTRICTIONS, the party
prevailing in such action shall be entitled to recover from the losing party all
of its costs, including court costs and reasonable attorney's fees.
SECTION 7.5 RIGHTS OF LENDERS
No breach or violation of the VALENCIA INDUSTRIAL CENTER RESTRICTIONS shall
defeat or render invalid the lien of any mortgage, deed of trust or similar
instrument securing a loan made in good faith and for value with respect to the
development or permanent financing of and Site or portion thereof; provided,
however, all of the VALENCIA INDUSTRIAL CENTER RESTRICTIONS shall be binding
upon and effective against any subsequent Owner of the Site or any portion
thereof whose title is acquired by foreclosure, trustee's sale, deed in lieu of
foreclosure or otherwise pursuant to such lien rights, but such subsequent Owner
shall take title free and clear of any violations of the VALENCIA INDUSTRIAL
CENTER RESTRICTIONS occurring prior to such transfer of title.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
SECTION 8.1 ASSIGNMENT OF RIGHTS AND DUTIES
Any and all of the rights, powers and reservations of DECLARANT herein contained
may be assigned to any person, corporation or association which will assume the
duties of DECLARANT pertaining to the particular rights, powers and reservations
assigned, and upon any such person, corporation or association's evidencing its
consent in writing to accept such assignment and assume such duties, he or it
shall, to the extent of such assignment, have the same rights and powers and be
subject to the same obligations and duties as are given to and assumed by
DECLARANT herein. The term DECLARANT as used herein includes all such assignees
and their heirs, successors and assigns. If at any time DECLARANT ceases to
exist and has not made such an assignment, a successor DECLARANT may be
appointed in the same manner as the VALENCIA INDUSTRIAL CENTER RESTRICTIONS may
be terminated, extended, modified or amended under Section 6.2 of Article Vi.
Any assignment or appointment made under this section shall be in recordable
form and shall be recorded in the County where the real property affected is
situated.
SECTION 8.2 CONSTRUCTIVE NOTICE AND ACCEPTANCE
Every person or other entity who now or hereafter owns or acquires any right,
title or interest in or to any portion of the real property made subject to the
VALENCIA INDUSTRIAL CENTER RESTRICTIONS is and shall be conclusively deemed to
have consented and agreed to every covenant, condition and restriction contained
herein, whether or not any reference to ties DECLARATION is contained in the
instrument by which such person or entity acquired an interest in said real
property.
SECTION 8.3 WAIVER
Neither DECLARANT nor its successors or assigns shall be liable to any owner,
lessee licensee, or occupant of a Site or of any portion of the real property
subject to the VALENCIA INDUSTRIAL CENTER RESTRICTIONS by reason of any mistake
in judgment, negligence, nonfeasance, action or inaction or for the enforcement
or failure to enforce any provision of this DECLARATION. Every owner, lessee,
licensee or occupant of any of Sites or any portion of the real property by
acquiring his interest therein agrees that he will not bring any action or suit
against DECLARANT to recover any such damages or to seek equitable relief.
SECTION 8.4 MUTUALITY, RECIPROCITY; RUNS WITH LAND
All covenants, conditions, restrictions and agreements contained herein are made
for the direct, mutual and reciprocal benefit of each and every Site and portion
of the real property now or hereafter made subject to the DECLARATION; shall
create mutual, equitable servitudes upon each Site and portion of the real
property in favor of every other Site and portion of the real property; shall
create reciprocal rights and obligations between the respective owners of all
Sites and portions of the real property and privity of contract and estate
between all grantees of said Sites and portions of the real property, their
heirs, successors and assigns; and shall, as to the owner of each Site and
portions of the real property, his heirs, successors and assigns, operate as
covenants running with the land, for the benefit of all other Sites and portion
of the real property.
SECTION 8.5 NOTICES
All notices, consents, requests, demands and other communications provided for
herein shall be in writing and shall be deemed to have been duly given if and
when personally served or 24 hours after being sent by United States registered
or certified mail, return receipt requested, postage prepaid, to the intended
party at its last known address.