Exhibit 10.18
Lease Agreement between the Company and Principal Mutual Life Insurance Company
OFFICE LEASE
THIS LEASE is made this 21st of July, 1997, between PRINCIPAL MUTUAL LIFE
INSURANCE COMPANY, an Iowa corporation hereinafter called "Landlord" and
AVESIS,INC. a Delaware corporation, hereinafter called "Tenant".
LEASE OF PREMISES
Landlord hereby leases to Tenant and Tenant hires from Landlord,
subject to all of the terms and conditions hereinafter set forth, those certain
premises (hereinafter called the "Premises") as set forth in Item 1 of the Basic
Lease Provisions and as shown in the space plan or floor plan attached hereto as
Exhibit "A" located in that certain office building ("Building") now existing
and located at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ situated in the City of Phoenix, County
of Maricopa, State of Arizona, as part of an office and commercial project
commonly known as The Clare-Weld Building, which land is improved with
landscaping, parking facilities and other improvements and appurtenances, all of
which land, improvements and appurtenances together with the Building and other
office and commercial structures are referred to collectively herein as "the
Project".
BASIC LEASE PROVISIONS
1. Building Name: The Clare-Weld Building
Suite: 300
Floor(s): Third Floor
Address: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
2. Rentable Area of the Premises: 6,672 square feet (as referred to in
Paragraph 3.5)
3. Rentable Area of the Building: 19,259 square feet
4. Tenant's Proportionate Share: 35 % (as referred to in Paragraph 3.4)
5. Basic Rent (as referred to in Article 2): $7,228.00 (plus applicable
taxes) The Basic Rent for the first 24 months of this Lease shall be Seven
Thousand Two Hundred Twenty-eight and 00/100 Dollars ($7,228.00) per month
(Plus applicable taxes). Thereafter, the Basic Rent shall be increased as
follows:
Months 25 through 36: $7,506.00 Per Month, Plus Applicable Taxes
Months 37 through 60: $7,784.00 Per Month, Plus Applicable Taxes
6. Base Year: The calendar year of 1997, grossed up to ninety-five percent
(95 %) occupancy.
7. Term (as referred to in Article 1): Five (5) years, commencing on October
1 19 97 and ending on September 30, 2002 .
Tenant acknowledges that Landlord has the right, pursuant to Paragraph
15.3, to terminate this Lease if Tenant notifies Landlord that Tenant
desires to assign this Lease or sublet the Premises or any portion of the
Premises.
8. Security Deposit (as referred to in Article 4): $ 7,228.00 (Plus
applicable taxes)
9. Landlord's Broker (as referred to in Article 40): CB Commercial
10. Tenant's Broker (as referred to in Article 40): CB Commercial
11. Vehicle Parking Spaces Allocated to Tenant (as referred to in Article 53):
Landlord will provide Tenant with twenty-two (22) parking stalls as
follows: Six (6) covered reserved stalls free for initial 24 months of
term; $20.00 per stall per month thereafter (plus sales tax), Sixteen (16)
uncovered, reserved stalls free for term of lease.
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12. Additional Basic Lease Provisions:
A. OPTION TO EXTEND: Tenant shall have the option to renew this Lease for
one (1) additional term of (5) years upon the following terms and
conditions:
1) Provided that at the end of the primary term of this
Lease, Tenant is in possession of the Premises and is
not in default of any of the terms, conditions or
covenants contained in this Lease, Tenant herein, for
Tenant's sole use and occupancy, is hereby granted an
option to renew this Lease for an additional term of
five (5) years commencing on October 1, 2002, and
expiring on September 30, 2007, on the same terms and
conditions contained herein, except for rental. The
rental for said extended term shall be at a
renegotiated rental rate based on the then prevailing
market rates, which shall not be less than that paid
during the primary term of this Lease.
2) Tenant shall notify Landlord, in writing, of its
desire to renew this Lease no later than six (6)
months prior to the expiration of the primary term
hereof and Landlord shall within thirty (30) days
after receiving said written notice from tenant,
designate a place and a time to meet with Tenant for
the purpose of negotiating a new rental rate for said
additional five (5) years.
13. All rent payments and notices shall be delivered to Landlord at the
following address:
Principal Mutual Life Insurance Company
c/o Metro Commercial Properties
▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
or at such address as Landlord may designate from time to time.
14. Signatures of Landlord and Tenant:
Landlord and Tenant hereby execute this Lease, consisting of the foregoing
provisions and the Additional Lease Provisions and exhibits which follow,
as of _____, 1997.
IN WITNESS WHEREOF, the parties hereto have signed and sealed this Lease Renewal
Agreement on the date hereinafter written.
EXECUTED BY LANDLORD, this_________day of__________________________,19__.
PRINCIPAL MUTUAL LIFE INSURANCE COMPANY, an Iowa Corporation
By: _______________________
Title: _______________________
By: _______________________
Title: _______________________
EXECUTED BY AVESIS, INC., a Delaware corporation, this____day of_________, 19__:
By: _______________________
Title: _______________________
Address:_______________________
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City/State/Zip:
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ADDITIONAL LEASE PROVISIONS
ARTICLE 1 - TERM
1.1 The term of this Lease shall be as shown in Item 8 of the Basic Lease
Provisions and shall commence on the commencement date as shown in Item 8 of the
basic Lease Provisions or such later date as the Premises shall be tendered to
Tenant ready for occupancy as set forth in Section 1.2 below, or upon such
earlier date as Tenant takes possession or commences use of the Premises for any
purpose other than construction. The date of commencement as defined above,
hereinafter called the "Commencement Date", shall be confirmed in writing by the
parties promptly upon such commencement.
1.2 Landlord may, prior to the commencement date set forth in Item 8 of the
basic Lease Provisions, tender the Premises to Tenant upon not less than fifteen
(15) days' prior written notice stating that the Premises will be ready for
occupancy on the date specified in such notice. The Premises shall be deemed
ready for occupancy upon the expiration of fifteen (15) days from the date said
notice is sent, and when Landlord has: (i) put in operation all building
services essential for the use of the Premises by Tenant; (ii) provided
reasonable access to the Premises for Tenant, its agents, employees, licensees
and invitees so that the same may be used without unnecessary interference; and
(iii) substantially completed all the work required to be done by it, or its
obligation to complete such work has been suspended as provided in the Work
Letter executed by the parties contemporaneously herewith.
ARTICLE 2 - RENT
Tenant shall pay a Basic Rent for the Premises in the amount shown in Item
5 of the Basic Lease Provisions for the specified lease year, in monthly
installments payable on the first day of each month in advance, except that if
the Commencement Date occurs on a day other than the first day of a month, then
the Basic Rent for the fraction of the month starting with the Commencement Date
shall be paid on said Commencement Date, prorated on the basis of the actual
number of days in said month. If the term hereof ends on a day other than the
last day of a month, then the Basic Rent for the month during which said
expiration occurs shall be prorated on the basis of the actual number of days in
said month. As used in reference to the Basic Lease Provisions, "lease year"
shall mean such succeeding period of twelve full calendar months during the
term, commencing with the month at the commencement of the lease term. In
addition to said Basic Rent, Tenant agrees to pay additional rent (including, if
applicable, any Consumer Price Index adjustments referred to below) as and when
hereinafter provided in this Lease. Said Basic Rent and additional rent,
together with all other sums payable by Tenant under this Lease, are hereinafter
sometimes referred to collectively as the "rent." The rent shall be payable to
Landlord, without deduction or offset, in lawful money of the United States of
America at the address for Landlord as shown in Item 14 of the Basic Lease
Provisions, or to such other person or at such other place as Landlord may from
time to time designate in writing.
ARTICLE 3 - RENT ADJUSTMENTS
3.1 In addition to Base Rent for each calendar year during the term of this
Lease, Tenant shall pay as additional rent, either of the following:
(b) If Item 7 of Basic Lease Provisions is applicable, the amount computed
by multiplying Tenant's Proportionate Share by the amount by which Total
Operating Expenses (as defined in Paragraph 3.9) for any calendar year after the
Base Year exceed Total Operating Expenses for the Base Year; provided,
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however, that if the Building is not fully occupied (as defined below) during
the entire Base year, the Total Operating Expenses for such year shall be
adjusted to reflect the Total Operating Expenses that would have been incurred
if the Building were fully occupied during the entire Base Year. As used herein,
fully occupied shall mean occupancy of not less than ninety-five (95%) percent
of the rentable area of the Building.
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Whether Paragraph 3. 1 (a) or 3. 1 (b) is applicable, Landlord shall have
the right to estimate in advance the amount due from Tenant for any calendar
year and to charge Tenant therefor on a monthly basis. In such case, Tenant
shall pay one-twelfth (1/12th) of such amount on the first day of each month
during such year. Any overpayments or underpayment will be adjusted as set forth
in Paragraph 3.3.
3.2 Landlord shall endeavor to provide Tenant with a written notice of the
estimated Total Operating Expenses, as hereinafter defined. No delay by Landlord
in delivering to Tenant any such notices shall affect Tenant's obligations
hereunder, which shall be effective as of the date specified in any such notice.
3.3 Within one hundred twenty (120) days after the end of each calendar year
during the lease term, Landlord shall provide Tenant with a written statement of
the actual Total Operating Expenses for that year. If actual Total Operating
Expense should exceed the estimated Total Operating Expenses for such year, then
Tenant shall pay to Landlord the additional amount due to Landlord within thirty
(30) days.
3.4 "Tenant's Proportionate Share" is defined as that percentage computed by
dividing the Rentable Area of the Premises, as hereinafter defined, by the
Rentable Area of the Building, as hereinafter defined. Tenant acknowledges that
Tenant's Proportionate Share is subject to adjustment, as set forth in Paragraph
3.8.
3.5 "Rentable Area of the Premises" and "Rentable Area of the Building" are
defined as those areas obtained by measuring the Premises and the Building in
accordance with the method of measuring rentable office space specified by the
Building Owners and Managers Association (BOMA). Tenant acknowledges that the
rentable square footage includes a seven percent (7 %) load factor.
3.6 "Operating Expense Overage" is defined as the amount computed by
subtracting the Landlord's Operating Expense Stop, as hereinafter defined, from
the Total Operating Expenses for a calendar year.
3.7 "Landlord's Operating Expense Stop" is defined as that amount computed
by multiplying the Rentable Area of the Building by the Expense Stop Rate stated
in Item 6 of the Basic Lease Provisions.
3.9 "Total Operating Expenses" are defined as those costs and expenses
necessary to operate, manage and maintain the Building in a manner deemed
reasonable and appropriate and for the best interest of the tenants in the
Building, including, but not limited to, the following:
(a) Wages, salaries and fringe benefits of all employees engaged in
the operation and maintenance of the Building; employer's Social Security
taxes, unemployment taxes or insurance, and any other taxes which may be
levied on such wages and salaries; the cost of disability and
hospitalization insurance and pension or retirement benefits for such
employees;
(b) All supplies and materials used in the operation and maintenance
of the Building;
(c) Cost of water, sewer, electricity, gas, telephone and other
utilities used in operating of the Building;
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(d) Cost of janitorial service, trash removal, parking lot sweeping,
window washing and landscape maintenance;
(e) Cost of replacement of Building equipment and all maintenance
service agreements on Building equipment, including alarm, security, energy
management, mechanical, electrical, window cleaning and elevator equipment;
(f) Cost of reasonable repairs and general maintenance;
(g) Any capital improvements made or installed for purposes of saving
labor or otherwise reducing applicable operating costs, not to exceed the
aggregate estimated cost savings annualized on a straight line basis over
the useful life of the capital improvements as determined by Landlord in
accordance with generally accepted accounting principles and practices in
effect at the time of acquisition of capital item;
(h) Any "Real Property Tax," which for purposes hereof means: (i) any
fee, license fee, license tax, business license fee, commercial rental tax,
levy, charge, assessment, penalty tax imposed by any taxing authority
against the Premises (or any portion thereof); (ii) any tax on the
Landlord's right to receive, or the receipt of, rent or income from the
Premises (or any portion thereof) or against Landlord's business of leasing
the Premises or any portion thereof); (iii) any tax or charge for fire
protection, streets, sidewalks, road maintenance, refuse or other services
provided to the Premises (or any portion thereof) by any governmental
agency; (iv) any tax imposed upon this transaction or based upon a
re-assessment of the Premises or the Project or any portion thereof due to
a change in ownership or transfer of all or part of Landlord's interest in
the Premises or the Project (or any portion thereof); and (v) any charge or
fee replacing any tax previously included within the definition of real
property tax. "Real Property Tax" does not, however, include Landlord's
federal or state income, franchise, inheritance or estate taxes. If the
Building is not separately assessed, the share of real property taxes
payable with respect to the Building and land shall be reasonably
determined by Landlord based upon the assessor's worksheets or other
reasonably available information.
(i) Cost of casualty and liability insurance applicable to the
Building and Landlord's personal property used in connection therewith
covering loss or damage of such property in the amount of its full
replacement value; such insurance shall also provide protection against all
perils included within the classification of fire, extended coverage,
vandalism, malicious mischief, special extended perils (i.e., all risk),
sprinkler leakage, earthquakes, plate glass damage, and other perils which
Landlord deems necessary.
(j) Cost of all accounting and other professional fees incurred in
connection with the operation of the Building;
(k) Cost of all accounting and other professional fees incurred in
connection with the operation of the Building;
(l) Any management fee, not in excess of current market rates for
similar buildings in the area, payable to Landlord or to any other person
or entity performing management services; and
(m) Common area costs allocable to the Building, as set forth in
Article 42.
Notwithstanding the foregoing, Total Operating Expenses shall not include
expenses for which Landlord is reimbursed or indemnified (either by an insurer,
condemnor, tenant or otherwise); expenses incurred in leasing or procuring
tenants; interest or amortization payments on any mortgage or mortgages, or rent
under any ground or underlying lease or leases; wages, salaries or other
compensation paid to any
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executive employees above the grade of building manager wages, salaries or other
compensation paid for clerks or attendants in concessions or newsstands
operating by Landlord; any cost or expense representing an amount paid to a
corporation affiliated with Landlord which is in excess of the amounts which
would be paid in the absence of such relationship; or cost of capital
improvements and depreciation or amortization, except as provided in Section
3.9(g) or otherwise above. Payment of additional rent pursuant to Section 3.1
above shall not be deemed a reimbursement to Landlord for
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purposes of this Section 3.9.
3.10 Any operating expense increase for any calendar year during the term
of this Lease shall be apportioned so that Tenant shall be charged under this
Article 3 for only that portion of the increase for such year as falls within
the term. This provision shall survive the expiration or earlier termination of
the term of this Lease.
3.11 Landlord and Tenant, each from time to time upon request of the other,
within five (5) days of such request, shall sign a written memorandum confirming
the amount of the additional rent due hereunder, as adjusted from time to time
hereunder.
ARTICLE 4 - SECURITY DEPOSIT
Tenant has deposited with Landlord the sum set forth in Item 9 of the Basic
Lease Provisions as security for the full and faithful performance of every
provision of this Lease to be performed by Tenant. If Tenant defaults with
respect to any provision of this Lease, including, but not limited to, the
provisions relating to the payment of rent, the repair of damage to the Premises
caused by Tenant or cleaning the Premises upon termination of this Lease,
Landlord may use, apply or retain all or any part of this security deposit for:
(i) the payment of any rent or any other sum in default; (ii) the repair of such
damage to the Premises; (iii) the cost of such cleaning; (iv) the payment of any
other amount which Landlord may spend or become obligated to spend by reason of
Tenant's default; or (v) to compensate Landlord for any other loss or damage
which Landlord may suffer by reason for Tenant's default, to the full extent
permitted by law. If any portion of said deposit is so used or applied, Tenant
shall within ten (10) days after written demand therefor deposit cash with
Landlord in an amount sufficient to restore the security deposit to its original
amount, and Tenant's failure to do so shall be a material breach of this Lease.
Landlord shall not be required to keep this security deposit separate from its
general funds, and Tenant shall not be entitled to interest on such deposit. If
Tenant shall fully and faithfully perform every provision of this Lease to be
performed by it, the security deposit or any balance thereof shall be returned
to Tenant (or, at Landlord's option, to the last assignee of Tenant's interest
hereunder) at the expiration of the Lease term, less the operation expense
increase described in Paragraph 3.10, if applicable.
ARTICLE 5 - UTILITIES AND SERVICES
5.1 Landlord shall furnish to the Premises between the hours of 8:00 a.m.
and 6:00 p.m. Monday through Friday, and between the hours of 9:00 a.m. and 1:00
p.m. Saturday, except legal holidays, such amounts of air conditioning, heating
and ventilation as may be required for the use and occupation of the Premises,
taking into consideration any give time the availability of energy resources and
prudent energy conservation practices. During other hours Landlord will provide
such air conditioning, heating and ventilation upon not less than twenty-four
(24) hours advance notice from Tenant to Landlord, and Tenant, upon presentation
of a ▇▇▇▇ therefore, shall pay Landlord for such service on an hourly basis at
the then prevailing rates therefore, which is currently $7.26 per hour, as
established by Landlord. If such service is not a continuation of that furnished
during regular business hours, Tenant shall pay for a minimum of three (3) hours
of such service. Subject to provisions set forth below, Landlord shall at all
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times furnish the Premises with elevator service, reasonable amounts of electric
current for normal lighting by building standard overhead fluorescent and
incandescent fixtures and for fractional horsepower office machines and water
for lavatory and drinking purposes. Landlord may impose a reasonable charge for
any utilities or services, including, but not limited to, electric current,
required to be provided by Landlord by reason of any substantial recurrent use
of the Premises at any time other than the hours of 8:00 a.m. to 6:00 p.m.
Monday through Friday and 9:00 a.m. to 1:00 p.m. Saturday excluding legal
holidays. Landlord shall provide janitor service; provided, however that Tenant
shall pay for any unusual janitorial services required by reason of any
non-building standard improvements in the Premises, including, but not limited
to, glass wall coverings and floor coverings, installed by or for Tenant under
the Work Letter or otherwise. Landlord shall replace building standard overhead
fixture lamps and bulbs as required. Tenant shall pay for replacement of all
other bulbs as required. Landlord shall not be liable for any failure to furnish
any of such services or utilities when
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such failure is caused by accidents, strikes, lockouts, other labor troubles,
governmental action, shortages or other conditions beyond Landlord's reasonable
control, and Tenant shall not be entitled to any damages nor shall any such
failure relieve Tenant of the obligation to pay full rent reserved herein or
constitute or be construed as a constructive or other eviction of Tenant. If at
any time during the term, Tenant's consumption of utilities exceeds the average
consumed by other tenants of the Building, Tenant will reimburse Landlord on
demand for the cost of such excess use. In such event, Landlord reserves the
right to install at Tenant's cost separate meters for utilities for the
Premises.
5.2 Tenant will not, without the written consent of Landlord, use any
apparatus or device in the Premises including, but not limited to, electronic
data processing machines, punch card machines and machines using current in
excess of 110 volts, which will in any way increase the amount of electricity or
water usually furnished or supplied for use of the Premises as general office
space; nor connect any apparatus, machine or device with water pipes or electric
current (except through existing electrical outlets in the Premises), for the
purpose of using electric current or water. If Tenant shall require electric
current in excess of that which Landlord is obligated to furnish under Paragraph
5.1 above, Tenant shall first obtain the consent of Landlord, which Landlord may
refuse, to the use thereof and Landlord may cause an electric current meter to
be installed in the Premises to measure the amount of electric current consumed
for any such other use. The cost of any such meter and of installation,
maintenance and repair thereof shall be paid for by Tenant and Tenant agrees to
pay Landlord promptly upon demand by Landlord for all such electric current
consumed for any such other use as shown by said meter, at the rates charged for
such services by the local public utility furnishing the same, plus any increase
in the Building electricity expense due to an increase in rates caused by
Tenant's increase of the Building's consumption or demand, plus any additional
expense incurred in keeping account of the electric current so consumed. If any
lights, machines or equipment (including, but not limited to, computers) are
used by Tenant in the Premises which materially affect the temperature
otherwise, maintained by the air conditioning system, or generates substantially
more heat in the Premises than would be generated by the building standard
lights and usual fractional horsepower office equipment, Landlord shall have the
right to install any machinery and equipment which Landlord reasonable deems
necessary to restore temperature balance, including, but not limited to,
modifications to the standard air conditioning equipment, and the cost thereof,
including the cost of installation and any additional cost of operation and
maintenance occasioned thereby, shall be paid by Tenant to Landlord upon demand
of Landlord.
ARTICLE 6 - USE OF PREMISES
Tenant shall use and occupy the Premises only for general office purposes
and shall not use or occupy the Premises for any other purpose without the prior
written consent of Landlord, which consent may be withheld at the sole
discretion of Landlord. Tenant shall not use or occupy the Premises in violation
of any ordinance, statute, law or other legal requirement. Tenant, at it sole
cost and expense,
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shall comply with any direction of any governmental authority having
jurisdiction which shall impose any duty upon Tenant or Landlord with respect to
the Premises or the use or occupation thereof, by reason of the nature of
Tenant's use or occupancy of the Premises. Tenant shall not do or permit to be
done anything which will invalidate or increase the cost of any fire and
extended coverage insurance policy covering the Building or property located
therein. Tenant shall reimburse Landlord promptly upon demand for any additional
premium charged for such policy by reason of Tenant's failure to comply with the
provisions of this Article 6.
ARTICLE 7 - ACCEPTANCE OF PREMISES
Tenant acknowledges that neither Landlord nor any agent of Landlord has
made any representation or warranty with respect to the premises or the building
or with respect to the suitability or fitness of either for the conduct of
Tenant's business or for any other purpose. The taking of possession or use of
the premises by tenant for any purpose other than construction shall
conclusively establish that the premises and the building were at such time in
satisfactory condition and in conformity with the provisions of this lease in
all respects, except as to any items for which Landlord is expressly declared
herein to be responsible and as to which Tenant shall give Landlord written
notice in reasonable detail
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within fifteen (15) days after Tenant takes such possession or commences such
use of the Premises or the term of this Lease otherwise commences as provided in
Article 1 above. Nothing contained in this Article 7 shall affect the
commencement of the term of this Lease or the obligation of Tenant to pay rent
hereunder as provided in Article 2 above. Landlord shall promptly correct any
actual defects of which it is notified as provided above.
ARTICLE 8 - ALTERATIONS AND EQUIPMENT
8.1 Tenant shall make no alterations, additions or improvements to the
Premises without the prior written consent of Landlord, and Landlord may impose
as a condition to such consent such requirements as Landlord in its sole
discretion may deem necessary or desirable, including, but not limited to ,
requirements as to the manner in which, and the time or times at which, such
work shall be done, the right to approve the contractor selected by Tenant to
perform such work, and the right to require Tenant to furnish Landlord (prior to
commencing or performing any such work) with demolition and/or lien and
completion bonds in form and amount satisfactory to Landlord. All such
alterations, additions or improvements shall become the property of Landlord and
shall be surrendered with the Premises, as a part thereof, at the end of the
term hereof, except that Landlord may, by written notice to Tenant given at
least thirty (30) days prior to the end of term, require Tenant to remove all or
any portion of any partitions, counters, railings, and other improvements
installed by Tenant, and to repair any damage to the Premises from such removal,
all at Tenant's sole expense.
8.2 All articles of personal property and all business and trade fixtures,
machinery and equipment, cabinet work, furniture and movable partitions owned by
Tenant or installed by Tenant at its expense in the Premises shall be and remain
the property of Tenant and may be revoked by Tenant at any time during the lease
term when Tenant is not in default hereunder, provided that Tenant promptly
repairs at Tenant's expense any damage to the Premises or the Building caused by
such removal. On the expiration of the term of this Lease, or on any earlier
termination of this Lease, Tenant shall remove all such personal property and
other items in accordance with the provisions of Article 21 below.
ARTICLE 9 - LIENS
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Tenant shall keep the Premises and the Building free from any mechanic's,
materialmen's, or other liens arising out of any work performed, materials
furnished or obligations incurred by Tenant, and agrees to defend, indemnify and
hold harmless Landlord from any against any such lien or claim or action
thereon, together with costs of suit and reasonable attorneys' fees incurred by
Landlord in connection with any such claim or actions.
ARTICLE 10 - TAX ON TENANT'S PROPERTY
10.1 Tenant shall be liable for and shall pay not later than ten (10) days
before delinquency, all taxes levied against any personal property or trade
fixtures placed by Tenant in or about the Premises. If any such taxes on
Tenant's personal property or trade fixtures are levied against Landlord or
Landlord's property and if Landlord, after written notice to Tenant, pays the
same, which Landlord shall have the right to do regardless of the validity of
such levy, but only under proper protest if requested by Tenant, or if the
assessed value of Landlord's property is increased by the inclusion therein of a
value placed upon such personal property or trade fixtures of Tenant and if
Landlord, after written notice to Tenant, pays the taxes based upon such
increased assessment, which Landlord shall have the right to do regardless of
validity thereof, but only under proper protest if requested by Tenant. Tenant
shall upon demand, as the case may be, repay to Landlord the taxes so levied
against Landlord, or the proportion of such taxes resulting from such increase
in the assessment; provided that, in any such event Tenant shall have the right,
in the name of Landlord and with Landlord's full cooperation, but at no cost to
Landlord, to bring suit in any court of competent jurisdiction to recover the
amount of any such taxes so paid under protest, any amount so recovered to
belong to Tenant.
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10.2 If the tenant improvements in the Premises, whether installed or paid
for by Landlord or Tenant and whether or not affixed to the real property so as
to become a part thereof, are assessed for real property tax purposes at a
valuation higher than the valuation at which tenant improvements conforming to
Landlord's building standard construction in other space in the Building are
assessed, then the real property taxes and assessments levied against Landlord
or Landlord's property be reason of such excess assessed valuation shall be
deemed to be taxes levied against Landlord or Landlord's property by reason of
such excess assessed valuation, shall be deemed to be taxes levied against
personal property of Tenant and shall be governed by the provisions of Section
10.1 above.
ARTICLE 11 - MAINTENANCE AND REPAIR
11.1 Subject to the provisions of Section 11.2 below, Tenant shall keep in
good order, condition and repair the Premises and fixtures therein and, subject
to the provisions of Article 17 and Article 18 below, shall reimburse landlord
for all repairs thereto or to the Building which are made necessary as a result
of any misuse or neglect by Tenant or any of its officers, agents, employees,
contractors, licensees, visitors, guests or invitees.
11.2 Subject to the provisions of Article 17 and Article 18 hereof Landlord
shall repair and maintain the structural components of the Building and public
areas, and all components of the plumbing, air conditioning and electrical
systems serving the Premises that are concealed or used in common by tenants of
the Building, Landlord shall not be liable for any failure to make any repairs
or to perform any maintenance unless such failure shall persist for an
unreasonable time after written notice of the need for such repairs or
maintenance is received by Landlord. Except as provided in Article 17 and
Article 18 hereof, there shall be no abatement of rent and no liability of
Landlord by reason of any injury to or interference with Tenant's business
arising from the making of any repairs, alterations or improvements; provided,
however, that in making such repairs, alterations or improvements, Landlord
shall interfere as little as reasonably practicable with the conduct of Tenant's
business in the Premises. Tenant waives the
44
benefit of any present or future law which might give Tenant the right to repair
the Premises at Landlord's expense or to terminate the Lease because of the
condition of the Premises or the Building.
ARTICLE 12 - ENTRY AND INSPECTION
Tenant will permit Landlord and its agents at all reasonable times during
normal business hours and at any time in case of emergency, in such manner as to
cause as little disturbance to Tenant as reasonable practicable, to enter into
and upon the Premises for the purpose of inspecting the same, or for the purpose
of protecting the interest therein of Landlord, and to take all required
materials and equipment into the Premises, and perform all required work
therein, including the erection of scaffolding, props, or other mechanical
devices, for the purpose of making alterations, repairs or additions to the
Premises or to any other portion of the Building in which the Premises are
situated as may be provided for by this Lease or as may be mutually agreed upon
the parties or as Landlord may be required to make by law or for maintaining any
service provided by Landlord to Tenant hereunder, including window cleaning and
janitor service, without any rebate of rent to Tenant for any loss of occupancy
or quiet enjoyment of the Premises, or damage, injury or inconvenience thereby
occasioned. Tenant shall also permit Landlord and its agents, upon request, to
enter or pass through the Premises or any part thereof, at reasonable times
during normal business hours to show the Premises to holders of encumbrances on
the interest of Landlord under the Lease, or prospective purchasers, mortgagees
or lessees of the Building as an entirety, and during the period of six (6)
months prior to the expiration date of this Lease, Landlord may exhibit the
Premises to prospective tenants. Landlord shall also have the right to enter on
or pass through the Premises, or any part thereof, at such times as such entry
shall be required by circumstances of emergency affecting the Premises or any
other portion of the Building in which the Premises are located. If during the
last month of the term hereof, Tenant shall have removed substantially all of
the Tenant's property and personnel from the Premises, Landlord may enter the
Premises and repair, alter and redecorate the same, without abatement of rent
and without liability to Tenant, and such acts shall have no effect on this
Lease.
9
ARTICLE 13 - HOLD HARMLESS AND NON-LIABILITY
Tenant agrees to hold harmless and indemnify Landlord and any and all
principals and affiliates of Landlord, including without limitation any
corporations or other entities controlling, controlled by or under common
control with Landlord, from and against any and all loss, cost, damage,
liability, claim or expense (including without limitation attorneys' fees and
costs) arising from or related to the use and occupancy of the Premises by
Tenant or by anyone claiming through Tenant; the conduct of Tenant's business;
any breach or default under this Lease; claims by any assignee, subtenant,
sublessee or other person, if Landlord declines to consent to any assignment,
sublease or other transfer or encumbrance or terminates this lease pursuant to
the provisions hereof; and any other acts or omissions of Tenant or of anyone
claiming through or under Tenant. Tenant assumes the risk of all such matters
and waives all claims against Landlord and all principals and affiliates of
Landlord in connection therewith, except for matters caused solely by Landlord's
negligence or willful misconduct. Throughout the term of this Lease, Tenant
shall maintain in effect public liability and property damage insurance with
limits of liability of not less than $1,000,000 combined single limit, showing
Landlord as an additional insured under each policy of insurance, and each such
policy of insurance shall provide that it may not be canceled or modified
without 30 days' prior written notice to Landlord. Such insurance shall be with
companies and in a form acceptable to Landlord. Tenant shall provide Landlord
with each original policy or a certificate thereof and proof of payment therefor
prior to the commencement of the term of this Lease and at least thirty (30)
days prior to expiration of any such policy. Except as expressly set forth
above, Landlord shall have no liability to Tenant for any damage to the Premises
or for any loss, damage or injury to property of Tenant therein or thereon
occasioned by bursting, rupture, leakage or overflow of any plumbing or other
45
pipe (including but not limited to water, steam or refrigerant lines),
sprinklers, tanks, drains, drinking fountains or washstands or other similar
causes, whether in, above, upon or about the Premises or the Building in which
the Premises are located.
ARTICLE 14 - WAIVER OF SUBROGATION
Each policy of insurance which Tenant obtains for the Premises and which
Landlord obtains for the Building shall include a clause or endorsement denying
the insurer any right of subrogation against the other party hereto to the
extent rights have been waived by the insured party prior to the occurrence of
injury or loss. If this endorsement is unobtainable without additional premium
or charge, then the insured party shall immediately notify the other party and
the other party shall have the right to pay the additional premium or charge for
this endorsement. Landlord and Tenant each waive any rights of recovery against
the other for injury or loss due to hazards covered by its own insurance, to the
extent of the injury or loss covered thereby.
ARTICLE 15 - ASSIGNMENT AND SUBLETTING
15.1 Tenant shall not, either voluntarily or by operation of law, assign,
sell, encumber, pledge or otherwise transfer all or any part of Tenant's
leasehold estate hereunder, or permit the Premises to be occupied by anyone
other than Tenant or Tenant's employees or sublet the Premises or any portion
thereof, without Landlord's prior written consent in each instance, which
consent shall not be unreasonably withheld. Consent by Landlord to one or more
assignments of this Lease or to one or more sublettings of the Premises shall
not constitute a consent to any future or other assignment or subletting to
exhaust Landlord's rights under this paragraph. The voluntary or other surrender
of this Lease by Tenant or mutual cancellation hereof shall not work a merger,
and shall, at the option of Landlord, terminate all or any existing subleases or
subtenancies or shall operate as an assignment to Landlord of such subleases or
subtenancies. If Tenant is a corporation which, under the then current
guidelines published by the Commissioner of Corporations of the State of
Arizona, is not deemed a public corporation, or is an unincorporated association
or partnership, the transfer, assignment or hypothecation of any stock or
interest in such corporation, association, or partnership in the aggregate in
excess of twenty-five percent (25%) shall be deemed an assignment within the
meaning and provisions of this Article 15. Tenant agrees to reimburse Landlord
for Landlord's reasonable costs and attorneys' fees incurred in connection with
the processing and documentation of any such required assignment, subletting,
transfer, change of ownership or hypothecation of this Lease or Tenant's
interest in and to
10
the Premises.
15.2 If Tenant desires at any time to assign this Lease or to sublet the
Premises or any portion thereon it shall first notify Landlord of its desire to
do so and submit in writing to Landlord: (i) the name of the proposed subtenant
or assignee; (ii) the nature of the proposed subtenant's or assignee's business
to be carried on in the Premises; (iii) the terms and provisions of the proposed
sublease or assignment; and (iv) such reasonable financial information as
Landlord may request concerning the proposed subtenant or assignee.
15.3 At any time within ten (10) days after Landlord's receipt of the
information specified in Section 15.2 above, Landlord may, by written notice to
Tenant, elect to (i) consent to the subletting or assignment upon the terms and
to the subtenant or assignee proposed; (ii) refuse to give its consent; (iii)
sublease the Premises or the portion thereof so proposed to be subleased by
Tenant or take an assignment of Tenant's leasehold estate hereunder or such part
thereof as shall be specified in said notice upon the same terms (excluding
terms relating to the use of Tenant's name or the continuation of
46
Tenant's business) as those offered to the proposed subtenant or assignee, as
the case may be; or (iv) terminate this Lease as to the portion (including all)
of the Premises so proposed to be subleased or assigned with a proportionate
abatement in the rent payable hereunder. Tenant agrees that no assignment or
subletting consented to by Landlord shall impair or diminish any covenant,
condition or obligation imposed upon Tenant by this Lease or any right, remedy
or benefit afforded Landlord by this Lease. If Landlord consents to such
assignment or subletting, Tenant may, within ninety (90) days after the date of
Landlord's consent, enter into a valid assignment or sublease of the Premises or
portion thereof upon the terms and conditions described in the information
required to be furnished by Tenant to Landlord pursuant to Section 15.2 above,
or upon other terms not more favorable to Tenant; provided, however, that any
material change in such terms shall be subject to Landlord's consent as provided
in this Article 15. Failure of Landlord to exercise any option set forth in
clauses (i) through (iv) above in this Paragraph 15.3 within such ten (10) day
period shall be deemed a refusal of Landlord to consent to the proposed
subletting or assignment.
15.4 No subletting or assignment, even with the consent of Landlord, shall
relieve Tenant of its obligations to pay the rent and to perform all of the
other obligations to be performed by Tenant hereunder, and no such subletting or
assignment shall require Landlord to accept a subtenant or assignee of Tenant as
a tenant under this Lease in the event of a default by Tenant hereunder. The
acceptance by Landlord of any payment due hereunder from any other person shall
not be deemed to be a waiver by Landlord of any provisions of this Lease or to
be a consent to any assignment or subletting.
ARTICLE 16 - TRANSFER OF LANDLORD'S INTEREST
In the event of any transfer or transfers of Landlord's interest in the
Premises or in the real property of which the Premises are a part, other than a
transfer for security purposes only, the transferor shall be automatically
relieved of any and all obligations and liabilities on the part of Landlord
accruing from and after the date of such transfer, including without limitation,
the obligations of Landlord under Article 4 above to return the security deposit
as provided therein, provided such obligations and liabilities are assumed in
writing by the transferee.
ARTICLE 17 - DAMAGE OR DESTRUCTION
17.1 If the Premises are damaged by any casualty, the damage shall be
repaired by and at the expense of Landlord, provided (a) such repairs are
permitted by applicable laws, ordinances and other legal requirements and (b)
such repairs can, in Landlord's opinion, be made within one (1) year after
notice to Landlord of the occurrence of such damage without the payment of
overtime or other premiums. If Landlord is required to make repairs, as set
forth above, then, except as set forth hereinbelow, until such repairs are
completed, the Tent shall be abated in proportion to the part of the Premises
which is unusable by Tenant in the conduct of its business. There shall be no
abatement of rent by reason of any portion of the Premises being unusable for a
period equal to one day or less.
17.2 If such repairs cannot, in Landlord's opinion, be made within such one
(1) year period, Landlord may, at its option, make them within a reasonable time
and in such event this Lease shall continue in effect and the rent shall be
abated in the manner and to the extent provided above. Landlord's election to
make such repairs must be evidenced by written notice to Tenant within thirty
(30) days after notice to Landlord of the occurrence of the damage advising
Tenant whether or not Landlord will make such repairs and the estimated time for
completing the same. If Landlord does not so elect to make such repairs which
cannot be made within such one (1) year period, then either party may be written
notice to the other cancel this Lease as of the date of the occurrence of such
damage.
17.3 In case of any damage or destruction mentioned in this Article 17
which Landlord is required or undertakes to repair as provided herein, Tenant
may terminate this Lease by notice to Landlord any time
47
prior to completion of the required repairs if Landlord has not restored and
rebuilt the Premises (exclusive of any property of Tenant or improvements
installed by Tenant located therein) to substantially the same condition as
existed immediately prior to such damage or destruction within one (1) year
after notice to Landlord of the occurrence of such damage or destruction, or
such longer period as Landlord has estimated pursuant to Paragraph 17.2, plus
such additional period thereafter as shall equal the aggregate period Landlord
may have been delayed in doing so by acts of God, adjustment of insurance, labor
trouble, governmental controls, unavailability of materials, or any other cause
beyond Landlord's reasonable control.
17.4 No damages, compensation or claim shall be payable by Landlord for
inconvenience, loss of business or annoyance or otherwise arising from any
repair or restoration of any portion of the Premises or other portion of the
Building. Landlord shall use reasonable efforts to effect such repair or
restoration promptly and to avoid unreasonable interference with Tenant's use
and occupancy.
17.5 Landlord shall not be required to carry insurance of any kind on
Tenant's property and shall not be obligated to repair any damage thereto or to
replace the same.
17.6 If the entire Building is destroyed by casualty, or any part of the
Building other than the Premises is damaged by casualty to the extent that
repairs cannot, in Landlord's opinion, be completed within one (1) year after
the date of such damage, Landlord, at its option, may cancel this Lease as of
the date of the occurrence of such destruction or damage by written notice to
Tenant.
ARTICLE 18 - EMINENT DOMAIN
18.1 If the whole of the Premises, or so much thereof as to render the
balance unusable by Tenant shall be taken under power of eminent domain, this
Lease shall automatically terminate as of the date of such condemnation, or as
of the date possession is taken by the condemning authority, whichever is later.
No aware for any partial or entire taking shall be apportioned, and Tenant
hereby assigns to Landlord any aware which may be made in such taking or
condemnation, together with any and all rights of Tenant now or hereafter
arising in or to the same or any part thereof, provided, however, that nothing
contained herein shall be deemed to give Landlord any interest in or to require
Tenant to assign to Landlord any award made to Tenant for the taking of personal
property and fixtures belonging to the Tenant or for the interruption of or
damage to Tenant's business or for Tenant's unamortized cost of leasehold
improvements.
18.2 In the event of a partial taking which does not result in a
termination of this Lease, rent shall be abated in proportion to the part of the
Premises so made unusable by Tenant.
18.3 No temporary taking of the Premises of Tenant's rights therein or
under this Lease shall terminate this Lease or give Tenant any right to any
abatement of rent hereunder; any award made to Tenant by reason of any such
temporary taking shall belong entirely to Tenant and Landlord shall not be
entitled to share therein.
ARTICLE 19 - RELOCATION
If the Premises contain less than three thousand (3,000) square feet of
rentable area, Landlord shall
12
have the right, at its option, upon at least thirty (30) days' written notice to
Tenant, to relocate Tenant and to substitute for the Premises described above
other space in the Building containing at least as much rentable area as the
original Premises. Such substituted premises shall be improved by Landlord at
its expense, with decorations and improvements at least equal in quantity and
quality to those in the original
48
Premises. Landlord shall pay the following expenses, to the extent reasonably
incurred by Tenant in connection with such substitution of Premises: costs of
moving, door lettering, telephone relocation and reasonable quantities of new
stationery.
ARTICLE 20 - DEFAULTS AND REMEDIES
20.1 The occurrence of any of the following shall constitute a material
default and breach of this Lease by Tenant:
(a) Any failure by Tenant to pay the rent or to make any other payment
required to be made by Tenant hereunder;
(b) The abandonment or vacation of the Premises by Tenant;
(c) Any failure by Tenant to observe and perform any other provision
of this Lease to be observed or performed by Tenant, where such failure
continues for thirty (30) days (except where a different period of time is
expressly specified in this Lease) after written notice by Landlord to
Tenant; provided, however, that any such notice shall be in lieu of, and
not in addition to, any notice required under Section 1161, et seq., of the
California Code of Civil Procedure; or
(d) The making by Tenant of any general assignment for the benefit of
creditors; the filing by or against Tenant of a petition to have Tenant
adjudged a bankrupt or of a petition or reorganization or arrangement under
any law relating to bankruptcy or insolvency (unless, in the case of a
petition filed against Tenant, the same is dismissed within sixty (60)
days); the appointment of a trustee or receiver to take possession of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where possession is not restored to Tenant within
thirty (30) days; or the attachment, execution or other judicial seizure of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where such seizure is not discharged within thirty
(30) days.
20.2 In the event of any such default by Tenant, then, in addition to any
other remedies available to Landlord at law or in equity, Landlord shall have
the immediate option to terminate this Lease and all rights of Tenant hereunder
by giving Tenant written notice of such election to terminate. In the event that
Landlord shall elect to so terminate this Lease, then Landlord may recover from
Tenant:
(a) The worth at the time of award of any unpaid rent which had been
earned at the time of such termination; plus
(b) 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 aware
exceeds the amount of such rental loss Tenant proves could have been
reasonably avoided; plus
c) The worth at the time of award of the amount by which the unpaid
rent for the balance of the term after the time of award exceeds the amount
of such rental loss that Tenant proves could be reasonably avoided; plus
(d) Any other amount necessary to compensate Landlord for all the
detriment proximately caused by Tenant's failure to perform its obligations
under this Lease or which in the ordinary course of things would be likely
to result therefrom; and
(e) At Landlord's election, such other amounts in addition to or in
lieu of the foregoing as may be permitted from time to time by applicable
law.
49
13
The term "rent" as used herein shall be deemed to be and to mean the Basic
Rent, additional rent and all other sums required to be paid by Tenant pursuant
to the terms of this Lease.
As used in subparagraphs (a) and (b) above, the "worth at the time of
award" is computed by allowing interest at the rate of one percent (1%) per
month. As used in subparagraph (c) above, the "worth at the time of award" is
computed by discounting such amount at the discount rate of the Federal Reserve
Bank of San Francisco at the time of award plus one percent (1%).
20.3 In the event of any such default by Tenant, Landlord shall have all
rights and remedies available to it under the prevailing law, with or without
terminated this Lease, to re-enter the Premises and remove all persons and
property from the Premises, such property may be removed and stored in a public
warehouse or elsewhere at the cost of the Tenant.
20.4 In the event of the vacation or abandonment of the Premises by Tenant
or in the event that Landlord shall elect to re-enter as provided above or shall
take possession of the Premises pursuant to legal proceeding or pursuant to any
notice provided by law and Landlord does not elect to terminate this Lease as
provided in this Article 20, then Landlord may, from time to time, without
terminating this Lease, either recover all rent as it becomes due or relet the
Premises or any part thereof for such term or terms and at such rent and upon
such other term and conditions as Landlord in its sole discretion may deem
advisable with the right to make alterations and repairs to the Premises;
provided that if Landlord elects to recover such rent as it becomes dues without
terminating this Lease pursuant to this ▇▇▇▇▇▇▇▇▇ ▇▇.▇, ▇▇▇▇▇▇▇▇ will not
unreasonably withhold its consent to a subletting or assignment by Tenant.
20.5 In the event that Landlord shall elect to so relet, then rent received
by Landlord from such reletting shall be applied as follows: first to the
payment of any indebtedness other than rent due hereunder from Tenant to
Landlord; second, to the payment of any cost of such reletting; third, to the
payment of the cost of any alterations and repairs to the Premises; fourth, to
the payment of-rent due and unpaid hereunder; and the residue, if any, shall be
held by Landlord and applied in payment of future rent as the same may become
due and payable hereunder. Should that portion of such rent received from such
reletting, during any month to which it is applied by the payment of rent
hereunder, be less than the rent payable during that month by Tenant hereunder,
then Tenant shall pay such deficiency to Landlord immediately upon demand
therefor by Landlord. Such deficiency shall be calculated and paid monthly.
Tenant shall also pay to Landlord, as soon as ascertained, any costs and
expenses incurred by Landlord in such reletting or in making such alterations
and repairs not covered by the rent received from such reletting.
20.6 No re-entry or taking possession of the Premises by Landlord pursuant
to this Article 19 shall be construed as an election to terminate this Lease
unless a written notice of such intention is given to Tenant or unless the
termination thereof is decreed by a court of competent jurisdiction.
Notwithstanding any reletting without termination by Landlord because of any
default by Tenant, Landlord may at any time after such reletting elect to
terminate this Lease for any such default.
20.7 In the event of the material default of the Tenant hereunder, Landlord
shall have the right, at Landlord's option, to suspend or discontinue the
services specified in Article 5 above, or any thereof, during the continuance of
any such default and any such suspension or discontinuance shall not be deemed
or construed to be an eviction or ejection of Tenant.
ARTICLE 21 - SURRENDER OF PREMISES; REMOVAL OF PROPERTY
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21.1 The voluntary or other surrender of this Lease by Tenant to Landlord,
or a mutual termination thereof, shall not work a merger, and shall, at the
option of Landlord, operate as an assignment to it of any or all subleases or
subtenancies affecting the Premises.
21.2 Upon the expiration of the term of this Lease, or upon any earlier
termination of this Lease, Tenant shall quit and surrender possession of the
Premises to Landlord in as good order and condition as the same are now or
hereafter may be improved by Landlord or Tenant, reasonable wear and tear and
repairs which are Landlord's obligation excepted, and shall, without expense to
Landlord,
14
remove or cause to be removed from the Premises all debris and rubbish,
furniture, equipment, business and trade fixtures, free-standing cabinet work,
movable partitioning and other articles of personal property owned by Tenant or
installed or replaced by Tenant at its expense in the Premises (exclusive of any
items described in Paragraph 21.4 below), and all similar articles of any other
persons claiming under Tenant, unless Landlord exercises its option to have any
subleases or subtenancies assigned to it, and Tenant shall repair all damages to
the Premises resulting from such removal.
21.3 Whenever Landlord shall re-enter the Premises as provided in Article
20 hereof, or as otherwise provided in this Lease, any property of Tenant not
removed by Tenant upon the expiration of the term of this Lease (or within
forty-eight (48) hours after a termination by reason of Tenant's default), as
provided in this Lease, shall be considered abandoned and Landlord may remove
any or all of such items and dispose of the same in any manner or store the same
in a public warehouse or elsewhere for the account and at the expense and risk
of Tenant, and if Tenant shall fail to pay the cost of storing any such property
after it has been stored for a period of ninety (90) days or more, Landlord may
sell any or all of such property at public or private sale, in such manner and
at such times and places as Landlord, in its sole discretion, may deem proper,
without notice to or demand upon Tenant, for payment of all or any part of such
charges or the removal of any such property, and shall apply the proceeds of
such sale; first, to the cost and expenses of such sale, including reasonable
attorneys' fees actual incurred; second, to the payment of the cost of, or
charges for, storing any such property; third, to the payment of any other sums
of money which may then or thereafter be due to Landlord from Tenant under any
of the terms hereof; and fourth, the balance, if any, to Tenant.
21.4 All fixtures, equipment, alterations, additions, improvements or
appurtenances attached to or built into the Premises prior to or during the term
of this I-ease, whether by Landlord at its expense of Tenant or both, shall be
and remain part of the Premises and shall not be removed by Tenant at the end of
the term unless otherwise expressly provided for in this Lease or unless such
removal is required by Landlord pursuant to the provisions of Article 8 above.
Such fixtures, equipment, alterations, additions, improvements or appurtenances
shall include, but not be limited to: all floor coverings, drapes, paneling,
molding, doors, vaults (exclusive of vault doors), plumbing systems, electrical
systems, lighting systems, silencing equipment, communication systems, fixtures
and outlets for the systems mentioned above and for telephone, radio, telegraph
and television purposes, and any special flooring or ceiling installations.
ARTICLE 22 - WAIVER OF DAMAGES FOR RE-ENTRY
Tenant hereby waives all claims for damages that may be caused by
Landlord's re-entering and taking possession of the Premises or removing and
storing the property of Tenant as herein provided, and Tenant shall hold
Landlord harmless thereby, and no such re-entry shall be considered to be a
forcible entry.
ARTICLE 23 - COSTS OF SUIT
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23.1 If Tenant or Landlord shall bring any action for any relief against
the other, declaratory or otherwise, arising out of or under this Lease,
including any suit by Landlord for the recovery of rent or possession for the
Premises, the prevailing party shall be entitled to a reasonable sum for
attorneys' fees in such suit and such attorneys' fees shall be deemed to have
accrued on the commencement of such action and shall be paid whether or not such
action is prosecuted to judgment.
23.2 Should Landlord, without fault on Landlord's part, be made a party to
any litigation instituted by Tenant, or by any third party against Tenant, or by
or against any person holding under or using the Premises by license of Tenant,
or for the foreclosure of any lien for labor or material furnished to or for
"Tenant, or by any such other person or otherwise arising out of or resulting
from any act or transaction of Tenant or of any such other person, Tenant
covenants to save and hold Landlord harmless from any liability, loss, cost,
damage, expense or judgment rendered against Landlord or the Premises or any
part thereof, and costs and expense, including reasonable attorneys' fees,
incurred by Landlord in or in connection with such litigation.
ARTICLE 24 - WAIVER
The waiver by Landlord or Tenant of any breach of any term, covenant or
condition herein contained shall not be deemed to be a waiver of such term,
covenant or condition as to any subsequent breach of the same or any other term,
covenant or condition herein contained. The subsequent acceptance of rent
hereunder by Landlord shall not be deemed to be a waiver of any preceding breach
of Tenant of any term, covenant or condition of this Lease, other than the
failure of Tenant to pay the particular rental so accepted, regardless of
Landlord's acknowledge of such preceding breach at the time of acceptance of
such rent.
ARTICLE 25 - HOLDING OVER
If Tenant holds over after the term hereof, with the express consent of
Landlord, such tenancy shall be from month-to-month only, and not a renewal
hereof or any extension for any further term, and in such case rent shall be
payable at the rate of one hundred fifty percent (150%) of the rent due for the
last month of the term of this Lease and such month-to-month tenancy shall be
subject to every other term, covenant and agreement contained herein. Nothing
contained in this Article 25 shall be construed as consent by Landlord to any
holding over by Tenant and Landlord expressly reserves the right to require
Tenant to surrender possession of the Premises to Landlord as provided in
Article 21 above forthwith upon the expiration of the term of this Lease or
other termination of this Lease.
ARTICLE 26 - SUBORDINATION; PROTECTION OF LENDERS
26.1 Landlord shall have the right to subordinate this Lease to any ground
lease, deed of trust or mortgage encumbering the Premises or the Project (or any
portion thereof), any advances made on the security thereof and any renewals,
modifications, consolidations, replacements or extensions thereof, whenever made
or recorded. However, Tenant's right to quiet possession of the Premises during
the Lease term shall not be disturbed if Tenant pays the rent and performs all
of Tenant's obligations under this Lease and is not otherwise in default. If any
ground lessor, beneficiary or mortgagee elects to have this Lease prior to the
lien of its ground lease, deed of trust or mortgage and gives written notice
thereof to Tenant, this Lease shall be deemed prior to such ground lease, deed
of trust or mortgage whether this Lease is dated prior or subsequent to the date
of said ground lease, deed of trust or mortgage or the date of recording
thereof.
26.2 If Landlord's interest in the Premises is acquired by any ground
lessor, beneficiary under a deed of trust, mortgagee, or purchaser at a
foreclosure sale, Tenant shall attorn to the transferee of or successor to
Landlord's interest in the Premises and recognize such transferee or successor
as Landlord
52
under the Lease. Tenant waives the protection of any statute or rule or law
which gives or purports to give Tenant any right to terminate this Lease or
surrender possession of the Premises upon the transfer of Landlord's interest.
26.3 Tenant shall sign and deliver any instrument or documents necessary or
appropriate to evidence any such attornment or subordination or agreement to do
so, on a form satisfactory to Landlord's lender. If Tenant fails to do so within
ten (10) days after written request, Tenant hereby makes, constitutes and
irrevocably appoints Landlord, or any transferee or successor of Landlord, as
the attorney-in-fact of Tenant to execute and deliver any such instrument of
document.
ARTICLE 27 - RULES AND REGULATIONS
The Rules and Regulations attached hereto as Exhibit "B" are hereby
incorporated herein by this reference and made a part hereof. Tenant agrees to
abide by and comply with said Rules and Regulations and any reasonable and
non-discriminatory amendments, modifications or additions thereto as may
hereafter be adopted and published by written notice to Tenant by Landlord.
Landlord shall not be liable to Tenant for any violation of such Rules and
Regulations by any other tenant or person.
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Tenant shall be responsible for all acts of its employees and a violation
of the Rules and Regulations (including those dealing with security) by any of
Tenant's employees shall constitute a material breach of this Lease by Tenant.
ARTICLE 28 - DEFINED TERMS
The word "Landlord" and "Tenant" as used herein, shall include the plural
as well as the singular. Words used in neuter gender include the masculine and
feminine and words in the masculine or feminine gender include the neuter. If
there be more than one Tenant, the obligation hereunder imposed upon Tenant
shall be joint and several. The headings or titles to the articles of this Lease
are not a part of this Lease and shall have no effect upon the construction or
interpretation of any part thereof.
ARTICLE 29 - HEIRS AND ASSIGNS
Subject to the provisions of Article 15 hereof relating to assignment and
subletting, this Lease is intended to and does bind the heirs, executors,
administrators, personal representatives, successors and assigns of any and all
of the parties hereto.
ARTICLE 30 - TIME OF ESSENCE
Time is of the essence in this Lease.
ARTICLE 31 - ENTIRE AGREEMENT
This instrument along with any exhibits and attachments or other documents
affixed hereto or referred to herein constitutes the entire and exclusive
agreement between Landlord and Tenant relative to the Premises herein described,
and this agreement and said exhibits and attachments and other documents may be
altered, amended or revoked only by an instrument in writing signed by both
Landlord and Tenant. Landlord and Tenant hereby agree that all prior or
contemporaneous oral agreements,
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understandings, or practices relative to the leasing of the Premises are merged
in and revoked by this agreement.
ARTICLE 32 - WORK LETTER
If an Exhibit "C", Work Letter, is attached to this Lease and is initialed
by both parties, then the Premises shall be finished in accordance with the Work
Letter.
ARTICLE 33 - RIGHT OF LANDLORD TO PERFORM
All covenants and agreements to be performed by Tenant under any of the
terms of this Lease shall be performed by Tenant at Tenant's sole cost and
expense and without any abatement of rent. If Tenant shall fail to pay any sum
of money, other than rent, required to required to be paid by it hereunder or
shall fail to perform any other act on its part to be performed hereunder, and
such failure shall continue beyond any applicable grace period set forth in
Article 20, Landlord may, but shall not be obligated so to do, and without
waiving or releasing Tenant from any obligations of Tenant, make any such
payment or perform any such other act on Tenant's part to be made or performed
as in this lease provided. All sums so paid by Landlord and all necessary
incidental costs, together with interest thereon at the rate hereinafter
provided, from the date of such payment by Landlord, shall be payable to
Landlord on demand and Tenant covenants to pay any such sums, and Landlord shall
have (in addition to any other right or remedy of Landlord) the same rights and
remedies in the event of nonpayment thereof by Tenant as in the case of default
by Tenant in the payment of the rent.
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ARTICLE 34 - INTEREST ON TENANT'S OBLIGATIONS
Any amount due from Tenant to Landlord which is not paid when due shall
bear interest at the ratio of twelve percent (12%) per year until paid, but the
payment of such interest shall not excuse or cure the default.
ARTICLE 35 - NOTICE
All notices which Landlord or Tenant may be required, or may desire, to
serve on the other may be served, as an alternative to personal service, by
mailing the same by registered or certified mail, postage prepaid, addressed as
set forth in Item 14 of the Basic Lease Provisions, or, from and after the
Commencement Date, to the Tenant at the Premises whether or not Tenant has
departed from, abandoned or vacated the Premises, or addressed to such other
address or addresses as either Landlord or Tenant may from time to time
designate to the other in writing.
ARTICLE 36 - QUIET ENJOYMENT
Landlord covenants and agrees that Tenant, upon paying the Basic Rent,
additional rent and all other charges herein provided for and observing and
keeping the covenants, agreements and conditions of this Lease on its part to be
kept, shall lawfully and quietly hold, occupy and enjoy the Premises during the
term of this Lease without hindrance or molestation of anyone lawfully claiming
by, through or under Landlord, subject, however, to the matters herein set
forth.
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ARTICLE 37 - ESTOPPEL CERTIFICATES
37.1 Tenant agrees at any time and from time to time upon not less than ten
(10) days' prior notice by Landlord to execute, acknowledge and deliver to
Landlord a statement in form and substance of Exhibit "D" attached hereto
certifying that this Lease is unmodified and in full force and effect (or if
there have been modifications, that the same is in full force and effect as
modified and stating the modifications), and the dates to which the Basic Rent,
additional rent and other charges have been paid in advance, if any, and stating
whether or not to the best knowledge of the signer of such certificate, Landlord
is in default in performance of any covenant, agreement or condition contained
in this Lease and, if so, specifying each such default of which the signer may
have knowledge, it being intended that any such statement delivered pursuant to
this Paragraph 37.1 may be relied upon by any prospective purchaser of the
Building or any mortgagee thereof or any assignee of any mortgage upon the
Building.
37.2 Landlord agrees at any time and from time to time upon not less than
ten (10) days' prior notice by Tenant to execute, acknowledge and deliver to
Tenant a statement in writing certifying that this Lease is unmodified and in
full force and effect (or if there shall have been modifications that the same
is in full force and effect as modified as stating the modifications) and the
dates to which the basic Rent, additional rent and other charges have been paid
in advance, if any, and stating whether or not to the best knowledge of the
signer of such certificate Tenant is in default in the performance of any
covenant, agreement or condition contained in this Lease and , if so, specifying
each such default of which the signer may have knowledge, it being intended that
any such statement delivered pursuant to this Paragraph 37.2 may be relied upon
by any prospective assignee of the Tenant's interest in this Lease.
ARTICLE 38 - ACCESS, CHANGES IN BUILDING FACILITIES, NAME
All except the inside surface of all walls, windows and doors bounding the
Premises (including exterior building walls, core corridor walls and doors and
any Core corridor entrance), and any space in or adjacent to the Premises used
for shafts, stacks, pipes, conduits, fan rooms, ducts, electric or other
utilities, sinks or other building facilities, and the use thereof, as well as
access thereto through the Premises for the purposes of operation, maintenance,
decoration and repair, are reserved to Landlord.
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ARTICLE 39 - NON-DISCRIMINATION
Tenant herein covenants by and for himself, his heirs, executors,
administrators, personal representatives, successors and assigns, and all
persons claiming under or through him, and this Lease is made and accepted upon
and subject to the following conditions: that there shall be no discrimination
against or segregation of any person or group of persons, on account of race,
color, creed, sex, national origin, or ancestry, in the leasing, sub-leasing,
transferring, use, occupancy, tenure or enjoyment of the Premises herein leased
nor shall Tenant, or any person claiming under or through Tenant, establish or
permit any such practice or practices of discrimination or segregation with
reference to the selection, location, number, use or occupancy of tenants,
lessees, subtenants, sublessees or vendees of the Premises.
ARTICLE 40 - BROKERS
The parties recognize as the broker(s) who procured this Lease the firm(s)
specified in Item 10 of the Basic Lease Provisions, and agree that Landlord
shall be solely responsible for the payment of brokerage commissions to the
specified Landlord's Broker, if any. If a Tenant's broker is named in Item 11 of
the Basic Lease, Landlord's Broker shall pay an appropriate portion of its
commission to Tenant's Broker is
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so provided in any agreement between Landlord's Broker and Tenant's Broker.
Nothing contained in this Lease shall impose any obligation on Landlord to pay
commission or fee to any party other than Landlord's Broker. If Tenant has dealt
with any other person or real estate broker with respect to leasing or renting
space in the Premises, Tenant shall be solely responsible for the payment of any
fee due to said person or firm and Tenant shall indemnify Landlord against any
liability, loss, cost, damage or expense (including attorneys' fees and costs)
with respect thereto.
ARTICLE 41 - APPLICABLE LAW
This Lease, and the rights and obligations of the parties hereto, shall be
construed and enforced in accordance with the laws of the State of Arizona.
ARTICLE 42 - COMMON AREAS
42.1 As used in this Lease, "Common Areas" shall mean all areas within the
Project which are available for the common use of tenants of the Project and
which are not leased or held for the exclusive use of Tenant or other tenants,
including, but not limited to, parking areas, driveways, sidewalks, loading
areas, access roads, corridors, landscaping and planted areas. Landlord may from
time to time change the size, location, nature and use of any of the Common
Areas, including converting Common Areas into leasable areas, constructing
additional parking facilities (including parking structures) in the Common
Areas, and increasing or decreasing Common Area land and/or facilities. Tenant
acknowledges that such activities may result in occasional inconvenience to
Tenant from time to time. Such activities and changes shall be expressly
permitted if they do not materially affect Tenant's use of the Property.
42.2 Tenant shall have the non-exclusive right (in common with other
tenants and all others to whom the Landlord has granted or may grant such
rights) to use the Common Areas for the purposes intended, subject to such
reasonable rules and regulations as Landlord may establish from time to time.
Tenant shall abide by such rules and regulations and shall use its best efforts
to cause others who use the Common Areas with Tenant's expressed or implied
permission to abide by Landlord's rules and regulations. At any time, Landlord
may close any Common Areas to perform any acts in and to the Common Areas as, in
Landlord's judgement, may be desirable to improve the Project. Tenant shall not,
at any time, interfere with the rights of Landlord, other tenants, or any other
person entitled to use the Common Areas.
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42.3 Landlord shall maintain the Common Areas in good order, condition and
repair and shall operate the Project, in Landlord's sole discretion, as a first
class commercial real property development. All costs incurred by Landlord for
the operation and maintenance of the Common Areas in the Project shall be
allocated by Landlord, in its discretion, among the buildings within the
Project. The Common Area costs allocated to the Building shall be included in
the Total Operating Expenses, pursuant to Paragraph 3.9(m). Common Area cost
include, but are not limited to, costs and expenses for the following: gardening
and landscaping; utilities, water and sewage charges; maintenance of signs
(other than Tenants' signs), premiums for liability, property damage, fire and
other types of casualty insurance on the Common Areas and worker's compensation
insurance; all real property taxes and assessment levied on or attributable to
the Common Areas and all Common Area improvements; all personal property taxes
levied on or attributable to personal property used in connection with the
Common Areas; straight-line depreciation on personal property owned by Landlord
which is consumed in the operation or maintenance of the (Common Areas; rental
or lease payments paid by Landlord for rented or leased personal property used
in the operation or maintenance of the Common Areas; fees for required licenses
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and permits; repairing, resurfacing, repaving, maintenance, painting, lighting,
cleaning, refuse removal, security and similar items; reserves for roof
replacement and exterior painting and other appropriate reserves; and a
reasonable allowance to Landlord for Landlord's supervision of the Common Areas
(not to exceed five percent (5 %) of the total of all other Common Area costs
for the year). Landlord may cause any or all of such services to be provided by
third parties. Common Area costs shall not include depreciation of real property
which forms part of the Common Area.
ARTICLE 43 - EXAMINATION OF LEASE
Submission of this instrument for examination or signature by Tenant does
not constitute a reservation of or option for Lease, and is not effective as a
Lease or otherwise until execution by and delivery to both Landlord and Tenant.
ARTICLE 44 - NO LIGHT, AIR OR VIEW EASEMENT
Any diminution or shutting off of light, air or view by any structure which
may be erected on lands adjacent to the Building shall in no way affect this
Lease or impose any liability on Landlord.
ARTICLE 45 - SIGNS AND AUCTIONS
Tenant shall not place any sign upon the Premises or Building or conduct
any auction thereon without Landlord's prior written consent. Landlord shall
provide directory signage to Tenant at Landlord's expense.
ARTICLE 46 - COVENANTS, CONDITIONS AND RESTRICTIONS
The Project and the Premises are subject to certain matters, covenant,
conditions, restrictions, easements, rights of way and development agreement.
Tenant agrees to be bound by all matters affecting the Premises or the Project
or any portion thereof, whether apparent or of record, including without
limitation the foregoing covenants, conditions and restrictions, together with
any amendments thereto.
ARTICLE 47 - INVALIDITY
The parties hereto agree that the terms and provisions of this Lease
express the intent of their agreement as fully as possible; however, the
invalidity or unenforceability of any term of provision hereof (except for
Tenant obligations to pay Basic Rent under Item 5 of the Basic Lease Provisions
hereof) shall not affect or impair any other term or provision hereof.
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ARTICLE 48 - CUMULATIVE RIGHTS
All rights, options and remedies of Landlord contained in this Lease shall
be construed and held to be cumulative, and no one of them shall be exclusive of
the other, and Landlord shall have the right to pursue any one or all of such
remedies or any other remedy or relief which may be provided by law or equity,
whether or not stated in this Lease.
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ARTICLE 49 - ACCORD AND SATISFACTION, RECEIPT OF MONEY
No payment by Tenant or receipt by Landlord of a lesser amount than the
rent herein stipulated shall be deemed to be other than on account of the
earliest Basic Rent and/or additional rent due and not yet paid, nor shall any
endorsement or statement on any check or any letter accompanying any check or
payment as rent be deemed an accord and satisfaction, and Landlord may accept
such check or payment without prejudice to Landlord's right to recover the
balance of such rent or pursue any other remedy in the Lease. No receipt of any
money by Landlord from Tenant after the termination of this Lease, after the
service of any notice, after the commencement of any suit, or after final
judgement for possession of the Premises, shall reinstate, continue or extend
the term of this Lease or affect any such notice, demand, suit or judgment.
ARTICLE 50 - NO MEMORANDUM
Tenant shall not record this Lease or any memorandum or short form thereof.
ARTICLE 51 - LATE CHARGE
Tenant acknowledges that late payment of rent due hereunder (including
without limitation Basic Rent and additional rent) will cause Landlord to incur
costs not contemplated by this Lease, the exact amount of which are extremely
difficult to ascertain. These costs include, but are not limited to, processing
and accounting charges, and late charges which may be imposed on Landlord by
others. Accordingly, if any installment of Basic Rent or additional rent or any
other amounts due form Tenant is not received by Landlord or Landlord's designee
within ten (10) days after the amount is due, Tenant shall pay to Landlord a
late charge equal to ten percent (10%) of the overdue amount. Acceptance of late
charges by Landlord shall not constitute a waiver of Tenant's default with
respect to the overdue amount, nor prevent Landlord from exercising any of the
other rights and remedies granted hereunder or at law or in equity.
ARTICLE 52 - FORCE MAJEURE
If Landlord cannot perform any of its obligations due to events beyond
Landlord's control, the time provided for performing such obligations shall be
extended by a period of time equal to the duration of such events. Events beyond
Landlord's control include, but are not limited to, acts of God, war, civil
commotion, labor disputes, strikes, fire, flood or other casualty, shortages of
labor or material, government regulation or restriction and weather conditions.
ARTICLE 53 - PARKING
53.1 Tenant shall be entitled, subject to the Rules and Regulations from
time to time in effect, to use the vehicle parking spaces in the Project
allocate to Tenant in Paragraph 12 of the Basic Lease Provisions without paying
any additional rent. Tenant's parking shall not be reserved and shall be limited
to vehicles no larger than standard size automobiles or pickup utility vehicles.
Tenant shall not cause large trucks or other large vehicles to parked within the
Project or on the adjacent public streets.
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Temporary parking of large delivery vehicles in the Project may be permitted by
the Rules and Regulations established by Landlord. Vehicles shall be parked only
in striped parking spaces and not in driveways, loading areas or other locations
not specifically designed for parking. If Tenant parks more vehicles in the
parking area than the number set forth in Paragraph 12 of the Basic Lease
Provision such conduct shall be a material breach of the Lease. In addition to
Landlord's other remedies under the Lease, Tenant shall pay a reasonable daily
charge for each such additional vehicle.
53.2 Notwithstanding Paragraph 53.1, Landlord reserves the right, at its
election at any time, to implement procedures regarding the parking facilities
in the Project that Landlord deems to be in the best interest of the tenants in
the Project, including, without limitation, procedures regarding implementation
of parking stickers or other identification devices, reserved parking spaces and
other matters. If Landlord implements any such procedures, all costs in
connection therewith shall be included in the Total Operating Expenses defined
in Paragraph 3.9.
Remainder of this page is intentionally left blank.
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EXHIBIT "A"
SITE PLAN
24
EXHIBIT "B"
ATTACHED TO AND MADE A PART OF OFFICE LEASE
RULES AND REGULATIONS OF THE BUILDING
The sidewalks, entrances, passages, courts, elevators, vestibules,
stairways, corridors or halls shall not be obstructed or used for any purpose
other than ingress and egress. The halls, passages, entrances, elevators,
stairways, balconies and roof are not for the use of the general public, and
Landlord shall in all cases retain the Tight to control and prevent access
thereto by all persons whose presence, in the judgment of Landlord, shall be
prejudicial to the safety, character, reputation or interests of the Building
and its tenants, provided that nothing herein contained shall be construed to
prevent such access by persons with whom tenants normally deal in the ordinary
course of their business, unless such persons are engaged in illegal activities.
No tenant and no employees of any tenant shall go upon the roof of the Building
without the written consent of Landlord.
2. No awnings or other projections shall be attached to the outside walls
of the Building without the prior written consent of Landlord. No hanging
planters, television sets or other objects shall be attached to or suspended
from ceilings without the prior written consent of Landlord. No curtains,
blinds, shades or screens shall be attached to or hung in, or used in connection
with, any window or door, without the prior written consent of Landlord. Except
as otherwise specifically approved by Landlord, all electrical
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ceiling fixtures hung in offices or spaces along the perimeter of the Building
must be fluorescent, of a quality, type, design and bulb color approved by
Landlord.
3. No sign, advertisement or notice shall be exhibited, painted or affixed
by any tenant on any part of, or so as to be seen from the outside of, a
tenant's premises or the Building without the prior written consent of Landlord.
In the event of the violation of the foregoing by any tenant, Landlord may
remove same without any liability, and may charge the expense incurred in such
removal to the tenant violating this rule. Interior signs on doors and walls
shall be inscribed, painted or affixed for each tenant by Landlord at the
expense of such tenant, and shall be of a size, color, location and style
acceptable to Landlord.
4. The wash room partitions, mirrors, wash basins and other plumbing
fixtures shall not be used for any purpose other than those for which they were
constructed, and no sweepings, rubbish, rags, or other substances shall be
thrown therein. All damage resulting from any misuse of the fixtures shall be
borne by the tenant who, or whose servants, employees, agents, visitors or
licensees, shall have caused the same.
5. No tenant shall ▇▇▇▇, paint, drill into, or in any way deface any part
of its premises or the Building. No boring, cutting or stringing of wires or
laying of linoleum or other similar floor coverings shall be permitted except
with the prior written consent of Landlord and as Landlord may direct.
6. No bicycles, vehicles, vending machines or animals of any kind shall be
brought into or kept in or about any tenant's premises and no cooking shall be
done or permitted by any tenant in its premises except that the preparation of
coffee, tea, hot chocolate and similar items for the tenant and its employees
and business visitors shall be permitted. No tenant shall cause or permit any
unusual or objectionable odors to escape from its premises.
7. No tenant's premises shall be used for manufacturing or for the storage
of merchandise except as such storage may be incidental to the use of such
premises for general office purposes. No tenant shall occupy or permit any
portion of its premises to be occupied as an office for a public stenographer or
typist, or for the manufacture or sale of liquor, narcotics, or tobacco in any
form, or as a medical office, or as a ▇▇▇▇▇▇ shop, manicure shop or employment
agency. No tenant shall engage or pay any employees on its premises except those
actually working for such tenant on its premises, nor advertise for laborers
giving an address at its premises. No tenant's premises shall be used for
lodging or sleeping or for any immoral or illegal purposes.
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8. No tenant shall make, or permit to be made, any unseemly or disturbing
noises, sounds or vibrations, or disturb or interfere with occupants of this or
neighboring buildings or premises or those having business with them, whether by
the use of any musical instrument, radio, phonograph, unusual noise, or in any
other way.
9. No tenant shall throw anything out of doors or down the passageways.
10. No tenant shall at any tine bring or keep upon its premises any
inflammable, combustible or explosive fluid, chemical or substance. No tenant
shall do or permit anything to be done in its premises, or bring or keep
anything therein, which shall in any way increase the rate of fire insurance on
the Building or on the property kept therein, or obstruct or interfere with the
rights of other tenants, or in any way injure or annoy them, or conflict with
the regulations of the fire department or the fire laws, or with any insurance
policy upon the Building or any part thereof, or with any rules and ordinances
established by the local health authority or other governmental authority.
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11. No additional locks or bolts of any kind shall be placed upon any of
the doors or windows by any tenant, nor shall any changes be made in existing
locks or the mechanisms thereof. Each tenant must, upon the termination of its
tenancy, restore to Landlord all keys of stores, offices, and toilet rooms,
whether furnished to or otherwise procured by tenant, and in the event of the
loss of any keys so furnished, such tenant shall pay to the Landlord the cost of
replacing the same or of changing the lock or locks opened by such lost key if
Landlord shall deem it necessary to make such a change.
12. All removals, or the carrying in or out of any safes, freight,
furniture, or bulky matter of any description must take place during the hours
which Landlord may establish from time to time. The moving of safes or other
fixtures or bulky matter of any kind must be made upon previous notice to the
manager of the Building and under his supervision, and the persons employed by
any tenant for such work must be acceptable to Landlord. Landlord reserves the
right to inspect all safes, freight or other bulky articles to be brought into
the Building. Landlord reserves the right to prohibit or impose conditions upon
the installation of heavy objects which might overload the Building floors.
13. No tenant shall purchase or otherwise obtain for use in its premises,
water, ice, towel, vending machines, janitorial, maintenance or other services
of any kind except from persons authorized by Landlord, and at hours and under
regulations fixed by Landlord.
14. Landlord shall have the right to prohibit any advertising by any tenant
which, in Landlord's opinion, tends to impair the reputation of the Building or
its desirability as an office building. Upon written notice from Landlord, any
tenant shall refrain from or discontinue such advertising.
15. Landlord reserves the right to exclude all persons from the Building
between the hours of 6 p.m. and 8 a.m. and at all hours of Saturdays, Sundays
and legal holidays. Each tenant shah be responsible for all persons for whom he
requests access and shall be liable to Landlord for all acts of such persons.
Nothing in this Paragraph 15 shall limit Landlord's right to control and prevent
access under Paragraph I above.
16. Any persons employed by any tenant to do janitorial work, shall, while
in the Building and outside of the tenant's premises, be subject to and under
the control and direction of the manager of the Building (but not as an agent or
servant of said manager or of Landlord, and the tenant shall be responsible for
all acts of such persons).
17. All doors opening into public corridors or lobbies shall be kept
closed, except when in use for ingress and egress.
18. The requirements of tenants will be attended to only upon application
to the building manager's office.
19. Canvassing, soliciting and peddling in the Building, unless approved by
Landlord, are prohibited and each tenant shall cooperate to prevent the same.
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20.All office equipment of any electrical or mechanical nature shall be
placed by tenants in their premises in settings approved by Landlord, so as to
absorb or prevent any vibration, noise or annoyance to other tenants.
21. No air conditioning unit or other similar apparatus shall be installed
or used by any tenant without the written consent of Landlord.
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22. There shall not be used in any space, or the public halls of the
Building, either by tenants or others, any hand trucks except those equipped
with rubber tires and side guards.
23. Landlord will direct electricians as to where and how telephone or
telegraph wires are to be introduced. No boring or cutting for wires or string
of wires will be allowed without written consent of Landlord. The location of
telephones, call boxes and other office equipment affixed to premises shall be
subject to the approval of Landlord.
24. All parking areas, pedestrian walkways, plazas and other public areas
forming a part of the Building shall be under the sole and absolute control of
Landlord with the exclusive right to regulate and control these areas. Tenant
agrees to conform to the rules and regulations that may be established by
Landlord for those areas from time to time. The Parking Rules and Regulations
attached hereto as Exhibit "B-1 " form a part hereof and are subject to change
in accordance with Paragraph 30 hereof.
25. Landlord shall have the right, exercisable without notice and without
liability to Tenant, to change the name and street address of the Building of
which the Premises are a part.
26. Landlord shall have the right to control and operate the public
portions of the Building, and the public facilities, and heating and air
conditioning, as well as facilities furnished for the common use of the tenants,
in such manner as it deems best for the benefit of the tenants generally.
27. The sashes, sash doors, skylights, windows, and doors that reflect or
admit light and air into halls, passageways or other public places in the
Building shall not be covered or obstructed by any tenant, nor shall any
bottles, parcels or other articles be placed on the window ▇▇▇▇▇. Tenant shall
see that the windows, transoms and doors of the premises are closed and securely
locked before leaving the Building and must observe strict care not to leave
windows open when it rains. Tenant shall exercise extraordinary care and caution
that all water faucets or water apparatus are entirely shut off before tenant or
tenant's employees leave the Building, and that all electricity, gas or air
shall likewise be carefully shut off, as to prevent wage or damage. Tenant shall
cooperate with Landlord in obtaining maximum effectiveness of the cooling system
by closing drapes when the sun's rays fall directly on the windows of the
Premises. Tenant shall not tamper with or change the setting of any thermostats
or temperature control values.
28. The scheduling of tenant move-ins shall be subject to the reasonable
discretion of Landlord.
29. The term "personal goods or services vendors" as used herein means
personel who periodically enter the Building for the purpose of selling goods or
services to a tenant, other than goods or services which are used by the tenant
only for the purpose of conducting its business on the Premises. "Personal goods
or services" include, but are not limited to, drinking water and other
beverages, food, barbering services, and shoe shining services. Landlord
reserves the right to prohibit personal goods and services vendors from access
to the Building except upon such reasonable terms and conditions, including, but
not limited to, the payment of a reasonable fee and provision for insurance
coverage, as are related to the safety, care and cleanliness of the Building,
the preservation of good order therein, and the relief of any financial or other
burden on the Landlord occasioned by the presence of such vendors or the sale by
them of personal goods or services to the Tenant or its employees. If necessary
for the accomplishment of these purposes, Landlord may exclude a particular
vendor entirely or limit the number of vendors who may be present at any one
time in the Building.
30. Landlord may at any time revoke, supplement or modify these Rules and
Regulations, or any portion thereof, whenever in Landlord's sole opinion such
changes are required for the care,
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cleanliness, safety or preservation of good order in the Building. All such
changes shall be effective five (5) days after delivery to tenant of written
notice thereof, except in the event of emergency, in which event they shall be
effective immediately upon notice to tenant.
3i. Tenant shall not place, install or operate on the Premises or in any
part of the Building, any engine, stove, or machinery, or conduct mechanical
operations or ▇▇▇▇ thereon or therein, or place or use in or about the Premises
any explosives, gasoline, kerosene, oil, acids, caustics, or any other
inflammable, explosive, or hazardous material without the prior written consent
of the Landlord.
32. Landlord will not be responsible for any lost or stolen personal
property, equipment, money, or jewelry from the Premises or from public rooms,
regardless of whether such less occurs when the areas is locked against entry.
33. No birds or animals shall be brought onto the Project, and no bicycles
or vehicles shall be brought into or kept in the Buildings.
34. No draperies, shutters, or window coverings shall be installed on
exterior windows or on windows or doors facing public corridors without
Landlord's prior written approval.
35. Employees of Landlord shall not receive or carry message for or to any
tenant or other occupant on the Property, nor shall they contract to render free
or paid services to any tenant or any tenant's agents, employees, or invitees;
if any of Landlord's employees perform any such services, such employees shall
be deemed the agent of the tenant for whom the services are being performed,
regardless of whether or how payment is arranged for services, and Landlord is
expressly relieved from any and all liability for any injury to persons or
damage to property (or any other damages) in connection with any such services.
36. Directories will be placed by Landlord, at its own expense, in
conspicuous places in the Building. No other directories shall be permitted,
unless previously consented to by Landlord in writing.
37. Tenant shall place, affix, or attach on any door or wall of the
Building exposed to the public only those identification markers and other
pre-approved by Landlord as to style, size, lettering and color. Landlord
reserves the right to place any such identification markers and signs on
Tenant's doors and walls and the cost thereof shall be billed to Tenant.
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EXHIBIT "B-1 " PARKING RULES AND REGULATIONS
So long as the Lease to which this Exhibit 'B-1" is attached remains
in effect, and so long as the parking rules and regulation adopted by Landlord
are not violated, Tenant or persons designated by Tenant shall be entitled on a
non-exclusive basis to use parking spaces in the Project parking structure (if
any) and on surface parking. Landlord expressly reserves the right to
redesignate parking areas and to modify the parking facilities for other uses or
to any extent.
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A condition of any parking shall be compliance by the porker with parking
facilities rules and regulations, and amendments thereto, including any sticker
or other identification system established by Landlord's parking operator.
Landlord reserves the right to impose parking charges except as provided in
Paragraph 53.1 of the Lease, on Tenant and Tenant's employees for any parking
now or hereafter available. The following Parking Rules and Regulations are in
effect until notice is given to Tenant of any change. Landlord reserves the
right to modify and/or adopt such other reasonable and nondiscriminatory rules
and regulations for the parking facilities as it deems necessary for the
operation of the parking facilities. Landlord may refuse to permit any person
who violates the within rules to park in the parking facilities, and any
violation hereof shall subject the car to removal at the owner's cost. In either
of said events the sticker of any other form of identification supplied by
Landlord shall be returned to Landlord.
1. Hours for the parking facility shall be 6:00 a.m. to 2:30 a.m.
2. Cars must be parked entirely within the stall lines painted on the
floor or pavement.
3. All directional signs and arrows must be observed.
4. The speed limit shall be 5 miles per hour.
5. Parking is prohibited:
(a) in areas not striped for parking
(b) in aisles
(c) where "no parking" signs are posted
(d) on ramps
(e) in cross hatched areas
(f) in such other areas as may be designated by Landlord's
parking operator.
6. Parking stickers or any other device or form of identification supplied
by Landlord shall remain the property of Landlord. Such parking identification
device must be displayed as requested and may not be mutilated in any manner.
The serial number of the parking identification device may not be obliterated.
Devices are not transferable and any device in the possession of any
unauthorized holder will be void. There will be a replacement charge payable by
Tenant or person designated by Tenant equal to the amount posed from time to
time by Landlord for loss of any magnetic parking card or parking sticker.
7. Parking facilities managers or attendants are not authorized to make or
allow any exception to these Parking Rules and Regulations.
8. Every ▇▇▇▇▇▇ is required to park and lock his own car. All
responsibility for damage to cars or persons is assumed by the ▇▇▇▇▇▇ and
Landlord and/or its agent shall have no liability whatsoever in connection
therewith.
9. Loss or theft of parking identification devices from automobiles must be
reported to the property manager immediately, and a lost or stolen report must
be filed by the customer at that time.
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(a) Any parking identification device reported lost or stolen
found on any unauthorized car will be confiscated and the illegal
holder will be subject to prosecution.
(b) Lost or stolen devices found by the purchaser must be
reported to the office of the property manager immediately to
avoid confusion.
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10. Spaces rented to persons are for the express purpose of parking one
automobile per space. Washing, waxing, cleaning or servicing of any vehicle by
the customer and/or his agents is prohibited.
11. Landlord and the property management reserves the right to refuse the
sale of monthly stickers or other parking identification devices, or use of the
parking facilities, to any tenant or person and/or his agents or representatives
who fail or refuse to comply with the above Parking Rules and Regulations and
with all unposted City, State or Federal legal requirements, ordinances, laws or
agreements.
12. Tenant shall acquaint all persons to whom Tenant assigns parking spaces
with these Parking Rules and Regulations.
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EXHIBIT C
WORK LETTER AGREEMENT
THIS WORK LETTER AGREEMENT is entered into as of the 7th day of August, 1997 by
and between Principal Mutual Life Insurance Company ("Landlord") and Avesis,
Inc.,a Delaware corporation ("Tenant").
RECITALS:
A. Concurrently with the execution of this Work Letter Agreement, Landlord
and Tenant have entered into a lease (the "Lease") covering certain
premises (the "Premises") more particularly described in Exhibit A
attached to the Lease.
B. In order to induce Tenant to enter into the Lease (which is hereby
incorporated by reference to the extent applicable) and in
consideration of the mutual covenants hereinafter contained, Landlord
and Tenant hereby agree as follows:
1. Completion Schedule. With ten (10) days after the execution of the
Lease and this Work Letter Agreement, Landlord shall deliver to
Tenant, for Tenant's review and approval, a schedule (the "Work
Schedule") setting forth a timetable for the planning and completion
of the installation of the Tenant Improvements (as defined in
Paragraph 2 below) to be constructed in the Premises, and the
estimated Commencement Date for the Term of the Lease. The Work
Schedule shall set forth each of the various items of work to be done
by or approval to be given by Landlord and Tenant in connection with
the completion of the Tenant Improvements. The Work Schedule shall be
submitted to Tenant for its approval and, upon approval by both
Landlord and Tenant, the approved Work Schedule shall become the basis
for completing the Tenant Improvements. If Tenant shall fail to
approve the Work Schedule as it may be modified after discussions
between Landlord and Tenant, within five (5) business days after the
date the Work Schedule is first received by Tenant, Landlord may, at
its option, terminate the lease and all of its obligations thereunder,
and in the event of such a lease termination Tenant shall be
responsible for all costs incurred hereunder and under the Lease,
including but not limited to the cost of Tenant Improvements, lease
commissions and design fees:
2. Tenant Improvement Allowance.
(a) Reference herein to "Tenant Improvements" shall include any or
all of the following work to be done in the Premises pursuant
to the Tenant Improvement Plans (defined in Paragraph 3
below):
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(i) Installation within the Premises of all partitioning,
doors, floor coverings, ceiling, painting, millwork
and similar items;
(ii) All electrical wiring, lighting fixtures, outlets and
switches, and other electrical work to be installed
within the Premises, and additional panels or
transformers to accommodate Tenant's requirements;
(iii) The furnishing and installation of all duct work,
terminal boxes, diffusers and accessories required
for the completion of the heating, ventilation and
air conditioning systems within the Premises;
(iv) All fire and life safety control systems, such as
fire walls, sprinklers, halon, fire alarms, including
piping, wiring and accessories, installed within the
Premises;
(v) All plumbing, fixtures, pipes and accessories to be
installed within the Premises;
(vi) Testing and inspection costs;
(vii) Contractor's fees, including but not limited to any
fees based on general conditions; and
(viii) Construction management by Landlord's representative
for the supervision of the tenant improvement
installation.
In no event, however, shall the Tenant Improvements include trade fixtures,
furniture or equipment of the Tenant.
(b) Landlord hereby grants to Tenant a "Tenant Improvement Allowance" of $8.00
per square foot. Landlord's maximum contribution towards the Tenant Improvements
shall be limited to said Tenant Improvement allowance. The Tenant Improvement
Allowance shall only be used for: Improvements that are mutually acceptable to
both parties.
(i) Payment of the cost of preparing the space plan and the Tenant
Improvement Plans, including mechanical, electrical, plumbing
and structural drawings and of all other aspects necessary to
complete the Tenant Improvement Plans. The Tenant Improvement
Allowance will not be used for the payment of extraordinary
design work or extraordinary or overstandard improvements not
included within the scope of Landlord's Building Standards or
for payments to any other consultants, designers or architects
other than Landlord's architect and/or space planner.
(ii) The payment of plan check, permit and license fees relating to
construction of the Tenant Improvements.
(iii) Construction of the Tenant Improvements; provided, however,
that the Tenant Improvement Allowance will be used
Non-Standard Improvements, if any, unless Landlord, in its
sole discretion, agrees in writing to payment of some or all
of the Non-Standard Improvements out of the Tenant Improvement
Allowance.
(iv) All other costs expended by Landlord in the construction of
the Tenant Improvements, including those costs incurred by
Landlord for construction of elements of the Tenant
Improvements in the Premises, which construction was performed
by Landlord prior to execution of this Lease by Landlord and
Tenant, which construction is for the benefit of tenants and
is customarily performed by Landlord prior to execution of
leases for space in the Project for reasons of economics
(examples of such construction would include,
66
but not be linked to, the extension of mechanical [including
heating, ventilating and air condition systems] and electrical
distribution systems outside of the core of the Building, wall
construction, column enclosures and painting outside of the
core of the Building, ceiling hanger wires and window
treatment).
(c) The costs of each item referenced in Paragraph 2(b) above shall be
charged against the Tenant Improvement Allowance. In the event that
the cost of installing the Tenant Improvements, as established by
Landlord's final pricing schedule, shall exceed the Tenant Improvement
Allowance, or if any of the Tenant Improvements are not to be paid out
of the Tenant Allowance as provided in Paragraph 2(b) above, the
excess shall be paid by Tenant to Landlord prior to the commencement
of construction of the Tenant Improvements.
(d) In the event that, after the Tenant Improvement Plans have been
prepared and a price therefore established by Landlord, Tenant shall
require any changes or substitutions to the Tenant Improvement Plans,
any additional costs related hereto shall be paid by Tenant to
Landlord prior to the commencement of construction of the Tenant
Improvements. Landlord shall have the right to decline Tenant's
request for a change to the Tenant Improvement Plans if such changes
are inconsistent with the provisions of Paragraph 3 and 4 below, or if
the change would, in Landlord's opinion, unreasonably delay
construction of the Tenant Improvements.
(e) Any unused portion of the Tenant Improvement Allowance upon completion
of the Tenant Improvements shall not be refunded to Tenant or be
available to Tenant as a credit against any obligations of Tenant
under the Lease.
3. Tenant Improvement Plans. Immediately after the execution of the Lease and
this Work Letter Agreement and subject to the time frames required by the
Work Schedule, Tenant agrees to meet with Landlord's architect and/or space
planner for the purpose of promptly finalizing a space plan for the layout
of the Premises. Based upon such space plan, Landlord's architect shall
prepare final working drawings and specifications for the Tenant
Improvements. Such final working drawings and specifications are referred
to herein as the "Tenant Improvement Plans." The Tenant Improvement Plans
must be consistent with Landlord's standard specifications for tenant
improvements for the project (the "Building Standard"), as the same may be
changed from time to time by Landlord.
4. Non-Standard Tenant Improvements. Landlord shall permit Tenant to deviate
from the Building Standards for the Tenant Improvements (the "Non Standard
Improvements"), provided that (a) the deviations shall not be of a lesser
quality than the Building Standards; (b) the total lighting for the
Premises shall not exceed 1.65 ▇▇▇▇▇ per Rentable Square Foot of the
Premises; (c) the deviations conform to applicable governmental regulations
and necessary governmental permits and approvals have been secured; (d) the
deviations do not require building service beyond the levels normally
provided to other tenants in the Project; and (e) Landlord has determined
in its sole discretion that the deviations are of a nature and quality that
are consistent with the overall objectives of Landlord for the Project.
Any Non-Standard improvements made shall remain on and be surrendered with
the Premises upon expiration of the Term, except that Landlord may, within
30 days before or 30 days after expiration of the Term, elect to require
Tenant to remove any NonStandard Improvements which may have been made to
the Premises. If Landlord so elects, at its own cost Tenant shall restore
the Premises to the condition designated by Landlord in its election,
before the last day of the term or within 30 days after notice of its
election is given, whichever is later.
5. Final Pricing and Drawing Schedule. After the preparation of the space plan
(attached as Exhibit X) and after Tenant's written approval thereof, in
accordance with the Work Schedule, Landlord shall cause its architect to
prepare and submit to Tenant the Tenant Improvement Plans. The
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Tenant Improvement Plans shall be approved by Landlord and Tenant in
accordance with the Work Schedule and shall thereafter be submitted to the
appropriate governmental body by Landlord's architect for plan checking and
the issuance of a building permit. Landlord, with Tenant's cooperation,
shall cause to be made to the Tenant Improvement Plans any changes
necessary to obtain the building permit. Concurrent with the plan checking,
Landlord shall have prepared a final pricing for Tenant's approval, in
accordance with the Work Schedule, taking into account any modifications
which may be required to reflect changes in the Tenant Improvement Plans
required by the City or County in which the Premises are located. After
final approval of the Tenant Improvement Plans, no further changes may be
made thereto without the prior written approval from both Landlord and
Tenant, and then only after agreement by Tenant to pay any excess costs
resulting from the deign and/or construction of such changes. Tenant hereby
acknowledges that any such changes shall be subject to the terms of
Paragraph 7 below.
6. Construction of Tenant Improvements. After the Tenant Improvement Plans
have been prepared and approved, the final pricing has been approved and a
building permit for the Tenant Improvements has been issued, Landlord shall
cause its contractor to begin installation of the Tenant Improvements in
accordance with the Tenant Improvement Plans.
Landlord shall supervise the completion of such work and shall use
reasonable commercial efforts to secure substantial completion of the work
in accordance with the Work Schedule. The cost of such work shall be paid
as provided in Paragraph 2 above. Landlord shall not be liable for any
damages, whether direct or consequential, as a result of delays in
construction beyond Landlord's reasonable control, including, but not
limited to, war, civil unrest, strike, labor troubles, unusually inclement
weather, governmental delays, inability to secure governmental approvals or
permits, governmental restrictions, availability of materials or labor,
acts of God, or delays by Tenant (or its architect or anyone performing
services on behalf of Tenant).
7. Completion and Rental Commencement Date. The commencement of the Term of
the Lease and Tenant's obligation for the payment of rent under the Lease
shall commence as of the date referred to in Section 7* of the Lease
provided, however, that if there shall be a delay in substantial completion
of the Tenant Improvements as a result of:
(a) Tenant's failure to approve any items or perform any other obligation
in accordance with and by the date specified in the Work Schedule;
(b) Tenant's request for materials, finishes or installations other than
those readily available;
(c) Tenant's changes in the Tenant Improvement Plans after the previous
approval of the Tenant Improvement Plans by Tenant. or
(d) Tenant's request to deviate from the Building Standards for the Tenant
Improvements;
then the commencement of the Term of the Lease and the rent commencement
date shall be accelerated by the number of days of such delay. The Tenant
Improvements shall be deemed substantially complete notwithstanding the
fact that minor details of construction, mechanical adjustments or
decorations which do not materially interfere with Tenant's use and
enjoyment of the Premises remain to be performed (items normally referred
to as "Punch List" items).
8. Certificate of Occupancy. Upon completion of the Tenant Improvements and
the issuances by the City or other relevant government agency of a
Certificate of Occupancy or other comparable certificate authorizing
occupancy of the Premises, Tenant will promptly provide Landlord with a
copy of the Certificate of Occupancy or other such certificate.
Section 7. of the Basic Lease Provisions
9. Force Majeure. Landlord shall have no liability whatsoever to Tenant on
account of the inability or delay of Landlord in fulfilling any of
Landlord's obligations under this Work Letter by reason of
68
strike, other labor trouble, governmental controls in connection with a
national or other public emergency, or shortages of fuel, supplies or labor
resulting therefrom or any other cause, whether similar or dissimilar to
the above, beyond Landlord's reasonable control. If this Work Letter
specifies a time period for performance of an obligation of Landlord, that
time period shall be extended by the period of any delay in Landlord's
performance caused by any of the events of force majeure described above.
IN WITNESS WHEREOF, this Work Letter Agreement is entered into as of the date
first written above.
LANDLORD:
Principal Mutual Life Insurance Company
---------------------------------------
By: _____________________________
Print Name:_____________________________
TENANT:
Avesis, Inc. ,a
------------------------------
Delaware Corporation
--------------------
By: _____________________________
Print Name:_____________________________
Its: _____________________________
By: _____________________________
Print Name:_____________________________
Its: _____________________________
EXHIBIT "D"
ESTOPPEL CERTIFICATE
The undersigned _________________, does hereby make the following statements:
I They are the Tenant under a certain Lease dated _____________________ with
_______________________ and ____________________________ as
Landlord, leasing the Property commonly known as _________________________.
2. The lease dated _____________________ is in full force and effect and the
undersigned is aware of no
69
defaults under the terms and conditions of the Lease and has no offsets
against rentals due the Landlord or to become due the Landlord.
3. The undersigned accepted possession of the Property on __________________
the Lease Term began on ________________________,and ends on
__________________ and the obligation to pay Base Rent begins on
____________________, pursuant to the terms and conditions of the Lease.
4. The total Base Rent to be paid pursuant to the terms of said Lease is not
less than $ and no Base Rent has been paid more than one month in advance.
By ____________________________
Title____________________________
Date ____________________________
30
EXHIBIT "E"
The addendum is attached to and made a part of that certain Lease (the "Lease")
of even date herewith between PRINCIPAL MUTUAL LIFE INSURANCE as Landlord, and
AVESIS, INC. as Tenant, relating to premises located at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇. This Addendum shall supplement and amend the Lease, and
the provisions set forth below shall supersede any inconsistent provisions set
forth in the Lease. To the extent possible, the provisions set forth below have
been numbered to coincide with the numbered articles and sections of the Lease
to which they relate. Except as may otherwise be specifically provided below,
any terms used below which are defined in the Lease shall have their respective
meanings set forth in the Lease.
Section 54: HAZARDOUS MATERIALS.
(a) Definition. As used in this Lease, the term "Hazardous Material" means any
flammable items, explosives, radioactive materials, hazardous or toxic
substances, material or waste or related materials, including any
substances defined as or included in the definition of "hazardous
substances", "hazardous wastes", 'infectious wastes", "hazardous materials"
or "toxic substances" now or subsequently regulated under any applicable
federal, state or local laws or regulations including, without limitation,
oil, petroleum-based products, paints, solvents, lead, cyanide, DDT,
printing inks, acids, pesticides, ammonia compounds and other chemical
produce, asbestos, PCBs and similar compounds, and including any different
products and materials which are subsequently found to have adverse effects
on the environment or the health and safety of persons.
(b) General Prohibition. Tenant shall not cause or permit any Hazardous
Material to be generated, produced, brought upon, used, stored, treated or
disposed of in or about the Premises or the Property by Tenant, its agents,
employees, contractors, sublessee or invitees without the prior written
consent of Landlord. Landlord shall be entitled to take into account such
factors or facts as Landlord may in its good faith business judgement
determine to be relevant in determining whether to grant, condition or
withhold consent to Tenant's proposed activity with respect to Hazardous
Material and Tenant shall indemnify, defend and hold Landlord harmless
70
from any and all actions (including, without limitation. remedial or
enforcement actions of any kind, administrative or judicial proceedings and
orders or judgements, arising out of or resulting therefrom), costs,
claims, damages, (including, without limitation, punitive damages),
expenses (including, without limitation attorneys', consultants' and
experts' fees, court costs and amounts paid in settlement or any claims or
actions), fines forfeitures or other civil, administrative or criminal
penalties, injunctive or other relief (whether or not based upon personal
injury, property damage, contamination of, or adverse effects upon, the
environment, water tables or natural resources), liabilities or liabilities
or losses (economic or other) arising from a breach of this prohibition by
Tenant, its agents, employees, contractors, sublessee or invites, In no
event, however, shall Landlord be required to consent to the installation
or use of any storage tanks in, on or under the Premises or the Property.
If Landlord consents to the generation, production, use , storage,
treatment or disposal of Hazardous Materials in or about the Premises by
Tenant, its agents, employees, contractors, sublessee or invitees, then, in
addition to any other requirements or conditions that Landlord may impose
in connection with such consent, (1) Tenant promptly shall deliver to
Landlord copies of all permits, approvals, filings, and reports reflecting
the legal and proper generation, production, use, storage, treatment or
disposal of all Hazardous materials, generated, used, stored, treated or
removed from the Premises and the Property and, upon Landlord's request,
copies of all hazardous waste manifests relating thereto, and (2) upon
expiration or earlier termination of this Lease, Tenant shall cause all
Hazardous Materials arising out of or related to the use or occupancy of
the Premises by Tenant or its agents, affiliates, customers, employees,
business associates or assigns to be removed from the Premises and the
Property and transported for use, storage or disposal in accordance with
all applicable laws, regulations and ordinances and Tenant shall provide
Landlord with evidence reasonable satisfactory to Landlord of the same.
(c) In the event that Hazardous Materials are discovered upon, in, or under the
Premises, and the applicable governmental agency or entity having
jurisdiction over the Premises requires the removal of such Hazardous
Materials arising to of or related to the use or occupancy of the premises
by Tenant or its agents, affiliates, customers, employees, business
associates or assigns but not those of its predecessors, tenant shall at
its sole cost and expense remove such Hazardous Materials, and perform any
remediation required by the applicable governmental agency or reasonable
necessary to make full economic use of the Property in a manner consistent
with its current use. Notwithstanding the foregoing, Tenant shall not take
any remedial action in or about the Premises or the Property, nor enter
into any settlement agreement, consent decree or other compromise with
respect to any claims relating to any Hazardous Material in any way
connected with the Premises or the Property without first notifying
Landlord of Tenant's intention to do so and affording Landlord the
opportunity to appear, intervene or otherwise appropriately assert and
protect Landlord's interest with respect thereto. Tenant immediately shall
notify Landlord in writing of: (i) any spill, release, discharge or
disposal of any Hazardous Material in, on or under the Premise, the
Property or any portion thereof, (ii) any enforcement, cleanup, removal or
other governmental or regulatory action instituted, contemplated, or
threatened pursuant to any Hazardous Materials Laws; (iii) any claim made
or threatened by any person against Tenant, the Premises, or the Property
relating to damage, contribution, cost recovery, compensation, loss or
injury resulting from or claimed to result from any Hazardous Materials;
and (iv) any reports made to any environmental agency arising out of or in
connection with any Hazardous materials in, on or removed from the Premises
or the Property, including any complaints, notices, warnings, reports or
asserted violations in connection therewith. Tenant also shall -supply to
Landlord as promptly as possible, and in any event within five (5) business
days after Tenant first receives or sends the same, copies of all claims,
reports, complaints, notices, warnings or asserted violations relating in
any way to the Premises, the Property or Tenant's use thereof.
71