EXHIBIT 10.111
OFFICE LEASE
This Lease is made as of this 30th day of April, 1999, by and between
TIAA REALTY, INC., a Delaware corporation ("Landlord") and TRIMARK PICTURES,
INC., a California corporation ("Tenant").
In consideration of the rents and covenants hereinafter set forth,
Landlord hereby leases to Tenant and Tenant hereby leases from Landlord the
following described Premises, upon the following terms and conditions:
1. FUNDAMENTAL LEASE PROVISIONS
1.1 Premises: MARINA BUSINESS CENTER II
Building: ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Suite: 200 Floor: 2
City: Marina del Rey: County: Los Angeles
State: California
1.2 Floor Area:Rentable Area: 23,258 square feet.
Usable Area: 20,467 square feet.
1.3 Term: One Hundred Twenty (120) months.
Target Commencement Date: August 1, 1999
1.4 Rental: DOLLARS PER DOLLARS PER
MONTHS MONTH ANNUM
------ ----- -----
1- 60 $ 39,538.60 $ 474,463.20
61-120 $ 47,678.90 $ 572,146.80
1.5 Expenses: Tenant shall pay Tenant's Share of all Expenses that
exceed Landlord's Base Year Costs for calendar year
1999, together with other items of Expense as set
forth in Article 6. Tenant's Share is Thirty- One
and 94/100 percent (31.94%).
1.6 After- Hours
Charges: After- Hours charges payable by Tenant are based on
Landlord's costs, and as of the Commencement Date
shall be as follows:
Air Conditioning $13.50 per hour
1.7 Prepaid
Rent: Tenant shall pay the Basic Rent for the first month
of the term upon execution of this Lease.
1.8 Security
Deposit: Forty- Seven Thousand Six Hundred Seventy- Eight and
90/100 Dollars
($47,678.90).
1.9 Landlord's c/o PM Realty Group
Address For ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
Notices: ▇▇▇▇▇▇ ▇▇▇ ▇▇▇, ▇▇ ▇▇▇▇▇
1.10 Tenant's Trimark Pictures
Address For ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇: ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
ATTN: ▇▇▇▇▇ ▇▇▇▇▇
or, after the commencement of the term,
to the Premises.
1.11 Brokers: PM Realty Group
1.12 Guarantee: None
2. PREMISES
2.1 The approximate location of the premises (the "Premises") leased
hereunder is shown on the drawing attached hereto as Exhibit A. The Premises
consist of that certain space situated in the building (the "Building")
described in Section 1.1 hereof. The area of the Premises for all purposes
hereunder is stipulated to be the square feet of usable area and the square feet
of rentable area specified in Section 1.2. As used in this Lease, the following
terms have the meanings indicated:
2.1.1 The term "gross area" or "gross square footage" means the
entire area being measured, including vertical elevator and ventilation shafts,
maintenance, telephone, mechanical and electrical rooms and closets, and all
other public areas measured from the exterior of exterior walls, and from the
center line of interior demising walls;
2.1.2 The term "usable area" or "usable square footage" means the
entire floor area of tenant space being measured, excluding vertical shafts and
all public areas, measured from the exterior walls and the exterior of interior
corridor walls, and the center line of interior demising walls; and
2.1.3 The term "rentable area" or "rentable square footage" means
the entire area measured in the same way within exterior Building walls
including all common or public areas of the Building allocated proportionately
to each floor of the Building but excluding public stairwells and such vertical
shafts. As to the area leased by Tenant, the rentable area is stipulated to be
the usable area of the Premises divided by 88%.
2.2 If the Premises are being newly constructed, then within thirty
(30) days after the Commencement Date either party may, by written notice to the
other given within such period, require that the area of the Premises be
remeasured by Landlord's space planner in accordance with the foregoing, at the
expense of the requesting party. If such remeasurement indicates a variance
from the square footage areas specified above by two percent (2%) or more, this
Lease shall be amended accordingly.
2.3 The Premises are (or when constructed will be) a part of a
business/commercial complex consisting of the Building and other buildings,
landscaping, parking facilities and other improvements described as the
"Project" in Section 1.1 hereof. The Project is generally shown on the drawing
attached hereto as Exhibit A-1. Landlord may in its sole discretion change the
size, shape, location, number and extent of any or all of the improvements in
the Project without any liability to or consent of Tenant, except that no
material change in the size or location of the Premises shall be made without
Tenant's consent. Tenant does not rely on the fact nor does Landlord represent
that any specific tenant or number of tenants shall occupy any space in the
Project.
2.4 Landlord reserves the right to use the roof and exterior walls of
the Premises, and the area beneath, adjacent to and above the Premises, together
with the right to install, use, maintain and replace equipment, machinery,
pipes, conduits and wiring through the Premises, which serve other parts of the
Project, in a manner and in locations which do not unreasonably interfere with
Tenant's use of the Premises. No light, air or view easement is created by this
Lease.
2.5 Tenant hereby acknowledges that the Project is being, or may be
constructed or reconstructed in phases, and that by reason of construction or
reconstruction activities there may be temporary incidents thereof such as dust,
dirt, barricades, detours, equipment or material in the Building or Common
Areas. Tenant hereby agrees that so long as Landlord conducts such activities
in a reasonable manner Landlord shall not be liable for any such incidents of
construction or reconstruction.
2.6 Except as specifically provided in the "Construction Provisions"
describing the construction of leasehold improvements (if any) attached hereto
as Exhibit C, Tenant shall lease the Premises on an "As Is" basis and Landlord
shall have no obligation to improve, remodel, alter or otherwise modify the
Premises prior to Tenant's occupancy.
3. TERM
3.1 Commencement Date. The term of this Lease shall be for the
duration set forth in Section 1.3 hereof and shall commence on the earlier to
occur of (i) the date Tenant (or any subtenant) takes possession of, occupies or
commences using any part of the Premises, or (ii) the date of "substantial
completion" (as hereinafter defined), or (iii) the date established by Landlord
in the event of a delay as described in Article 10 hereof. The date on which
the term of this Lease commences pursuant to the foregoing (the "Commencement
Date") shall be confirmed by Landlord and Tenant in the form set forth in
Exhibit B attached hereto when Tenant takes possession of the Premises. Failure
of Tenant to execute Exhibit B within ten (10) days after written request from
Landlord shall be a material default hereunder. This Lease shall be a binding
contractual agreement effective upon the date of execution hereof by both
Landlord and
Tenant, notwithstanding the later commencement of the term of this Lease.
3.2 Substantial Completion. For purposes hereof, the phrase
"substantial completion" means the completion (as determined, in the event of a
dispute, by Landlord's architect or space planner in accordance with AIA
standards) of the construction work to be performed by Landlord pursuant to the
"Plans" (as defined in Exhibit C, "Construction Provisions", attached hereto),
except for such items that constitute minor defects or adjustments which can be
completed after occupancy by Tenant without causing material interference with
Tenant's use of the Premises (so-called "punch list" items). On or about the
date when Landlord has substantially completed all work to be performed by
Landlord in the Premises, Landlord and Tenant shall inspect the Premises and all
punch list items shall be noted in writing on Landlord's punch list form.
Damage to the Premises caused by Tenant or its agents or contractors shall not
constitute punch list items. As soon thereafter as conditions permit, Landlord
shall complete all such punch list items, provided Tenant is not then in default
hereunder. Upon Landlord's completion of such punch list items, Landlord and
Tenant shall reinspect the Premises with regard to all punch list items
previously noted and shall indicate on Landlord's punch list form if such items
have been satisfactorily completed. Tenant's failure to reinspect any such
punch list items within fifteen (15) days after Landlord's written request to do
so shall constitute an acceptance by Tenant of such items as being
satisfactorily completed.
3.3 Target Commencement Date. The Target Commencement Date is an
estimated date only and is set forth in Section 1.3 hereof. Landlord shall use
its best efforts to complete "Landlord's Work" (as defined in Section 10.1)
prior to the Target Commencement Date, but this Lease shall not be void or
voidable nor shall Landlord or its agents be liable to Tenant by reason of
Landlord's failure to complete Landlord's Work by such date. If for any reason
(except as set forth in Section 10.2 hereof) substantial completion of
Landlord's Work does not occur within six (6) months after the Target
Commencement Date, either party hereto may, upon ten (10) days' prior written
notice to the other, terminate this Lease and the parties hereto shall
thereafter be discharged from all further obligations hereunder. Landlord shall
use its best efforts to give Tenant sufficient advance notice of the date of
substantial completion. Landlord shall use its best efforts to cooperate with
Tenant's move-in schedule and, at Landlord's sole discretion, may allow Tenant
to have access to the Premises prior to completion of Landlord's Work (provided
that Landlord may, after having allowed such access, disallow further access) so
that Tenant may install its furniture, equipment and fixtures, prior to the
Commencement Date. In such event, however, Tenant shall not interfere with
completion of such work and shall be responsible for any delays, costs or
expenses incurred by Landlord due to any such interference, and in such event
Tenant shall hold Landlord harmless and indemnify Landlord for any loss or
damage to Tenant's furniture, equipment, fixtures, or merchandise and for injury
to any
persons arising out of the performance of such work in the Premises unless
caused by the negligence of Landlord, its agents or contractors.
4. RENT AND EXPENSE PAYMENTS
4.1 General. The "Rent" or "Rental" hereunder is composed of "Basic
Rent" as set forth in Section 1.4 hereof and adjustments thereto as hereinafter
provided. The term "Expenses" hereunder means all costs, expenses, fees,
charges or other amounts described in Article 6. Tenant agrees to pay to
Landlord all Rent and Expenses required under this Lease, which shall be payable
monthly to Landlord (unless expressly provided otherwise), without deduction or
offset, in lawful money of the United States of America at the office maintained
by Landlord in the Project or at such other place as Landlord may from time to
time designate in writing. Notwithstanding any contrary provisions of this
Lease, all Expenses, late payment fees, interest, "After-Hours Charges", parking
fees payable under the "Parking License Agreement" attached hereto, and all
other sums of money or charges required to be paid pursuant to this Lease shall
be deemed "Additional Rent" for the Premises, and in any notice to pay rent or
quit the Premises, Landlord may include and designate same as rent then past due
and owing, if such is the case. Any Rent or Expense increase which is called
for hereunder, the payment of which is delayed or prevented by reason of any
wage and price control law, rent control law, or other governmental rule, law or
restriction, shall accrue and be payable together with interest thereon at the
"Agreed Rate" (as defined in Section 39.14 hereof), at the end of the Lease
term, or sooner if allowed. No acceptance by Landlord of partial payment of any
sum due from Tenant shall be deemed a waiver by Landlord of any of its rights to
the full amount due, nor shall any endorsement or statement on any check or
accompanying letter from Tenant be deemed an accord and satisfaction. Any Rent
payments or other sums received from Tenant or any other person shall be
conclusively presumed to have been paid on Tenant's behalf, unless Landlord has
been given prior written notice to the contrary by Tenant. Tenant agrees that
the acceptance by Landlord of any such payment shall not constitute a consent by
Landlord or a waiver of any of its rights under this Lease. In no event shall
the foregoing be construed as requiring Landlord to accept any Rent or other
sums from any person other than Tenant. If the term begins or ends on a day
other than the last day of a month, then the Rent and Expenses for such month
shall be prorated based on a thirty (30) day month. All prorations of Rent or
Expenses under this Lease for fractional periods shall be based on a thirty (30)
day month and a three hundred sixty (360) day year.
4.2 Basic Rent. Tenant shall pay the "Basic Rent" set forth in
Section 1.4 hereof on the first day of each month in advance, beginning on the
Commencement Date. Landlord may, but shall not be obligated to, send a ▇▇▇▇ or
statement for Rent to Tenant each month, but Tenant shall be obligated to pay
Rent on the first day of each month regardless of whether or not it receives a
▇▇▇▇ or statement.
4.3 Prepaid Rent. Tenant shall pay prepaid Basic Rent concurrently
with the execution of this Lease, as set forth in Section 1.7 hereof.
5. CPI ADJUSTMENT (INTENTIONALLY DELETED)
6. EXPENSES
6.1 Tenant shall pay its share of "Expenses" on the first day of each
month during the term hereof or otherwise as set forth in this Article 6. The
monthly Expenses payable by Tenant hereunder consist of the amount by which
Tenant's Share of Expenses exceeds Landlord's Base Year Costs (as such terms are
hereinafter defined), calculated as follows: Total Expenses (estimated or
actual) multiplied by Tenant's Share minus Landlord's Base Year Costs, divided
by twelve (12) months.
6.2 Definitions. As used in this Lease, the following terms have the
meanings indicated:
6.2.1 "Landlord's Base Year Costs" means the annualized dollar
amount which results from multiplying the total actual Expenses incurred by
Landlord during the Base Year by Tenant's Share. Such amount constitutes the
amount per year which Landlord agrees to pay towards Expenses allocable to the
Premises, without reimbursement from Tenant. Landlord's Base Year Costs shall
be adjusted to be equal to Landlord's reasonable estimate of Expenses assuming
at least ninety-five percent (95%) of the total rentable area of the Building
was occupied for the entire year, and assuming the Building was fully completed
and fully assessed for property tax assessment, maintenance and repair purposes.
6.2.2 The term "Expenses" means all expenses, costs and fees paid
or incurred by Landlord during any calendar year during the term hereof in
connection with or attributable to the Building and Common Area (as described
hereinafter), including any parking facilities therein, for:
6.2.2.1 Electricity, water, gas, sewer, and all other
utility services to or for the Building or Common Area, including any utility
taxes, fees, charges or other similar impositions paid or incurred by Landlord
in connection therewith; and
6.2.2.2 Operation, maintenance (including reasonable
reserves), security services, replacement for normal wear and tear, repair,
restriping or resurfacing of paving, management (including costs of on-site
offices and personnel) insurance (including public liability and property
damage, rent continuation, boiler and machinery and extended coverage
insurance), and cleaning of the Building and Common Area and all furnishings,
fixtures and equipment therein, but excluding the costs of special services
rendered to tenants (including Tenant) for which a separate charge is made,
costs of leasing and preparing space for new tenants in the Building, or costs
borne solely
by Tenant under the Lease. The term "Expenses" includes the annual amortization
of costs (including financing at the then prevailing rate, if any) of any
equipment, device or improvement required after completion of the Building by
governmental authority or incurred as a labor saving measure or to reduce
operation or maintenance expenses with respect to the Building and Common Area
where such costs are amortized over the useful life thereof and which do not
inure primarily to the benefit of any particular tenant; and
6.2.2.3 All real property taxes and personal property
taxes, licenses, charges and assessments which are levied, assessed, imposed or
collected by any governmental authority or improvement or assessment district
during any calendar year with respect to the Building or Common Area and the
land on which the same is located, and any improvements, fixtures, equipment and
other property of Landlord, real or personal, located in the Project and used in
connection with the operation or maintenance of the Building or Common Area
(computed on a cash basis or as if paid in permitted installments regardless of
whether actually so paid), as well as any tax which shall be levied or assessed
in addition to or in lieu of such taxes (it being acknowledged that because of
the passage of laws which limit increases in real property taxes, government
agencies may impose fees, charges, assessments or other levies in connection
with services previously furnished without charge or at a lesser charge and
which were previously paid for in whole or in part, directly or indirectly by
real property taxes), any gross excise tax or other similar tax, and any costs
or expenses of contesting any such taxes, licenses, charges or assessments, but
excluding any federal or state income or gift tax or any franchise, capital
stock, estate or inheritance taxes.
6.2.2.3.1 Tax increases. Notwithstanding anything to
the contrary contained herein, if, during the first twenty-four (24) months of
the initial term of this Lease, a change " in ownership" of the project occurs
as a result, the project is reassessed, then Tenant shall not be liable for
increases in real property taxes resulting from such reassessment. For purposes
of this Article 6, " change in ownership" has the same definition as in
California Revenue and Taxation Code Section 60-68, or any amendments or
successor statutes to those sections.
6.2.3 The term "Common Area" means that portion of the Project
other than the Building and other buildings for lease to tenants which is from
time to time designated and improved for nonexclusive, common use by more than
one person. The general location of the Common Area is shown on Exhibit A-1
attached hereto and incorporated by reference. The Common Area includes parking
facilities in the Project.
Any cost or expense included in Expenses which is
attributable to Common Area shall be prorated by Landlord to the Building based
on the proportion which the total square footage of the Building bears to the
total square footage of all buildings in the
Project from time to time or by such other fair and reasonable method of
allocation based on use or benefit as Landlord may determine, except that, with
regard to taxes, Landlord may use such allocation of taxes among the various
parcels in the Project as may have been used by the taxing authority.
6.2.4 The term "Base Year" means the calendar year specified at
Section 1.5.
6.2.5 The term "Subsequent Year" means the first full calendar
year following the Base Year and each calendar year, or part thereof, thereafter
occurring during the term of this Lease.
6.2.6 "Tenant's Share" is hereby agreed by Landlord and Tenant to
be the percentage set forth in Section 1.5 hereof.
6.2.7 Notwithstanding anything to the contrary contained herein,
the Expenses payable by Tenant during the Subsequent Year of the initial lease
tem shall not be increased by more than five percent (5%) per year, compounded
cumulative (the "Expense Cap"); provided, however, that the Expense Cap shall
not apply to Expenses over which the Landlord has no reasonable control, i.e.,
utility charges real estate taxes and assessments, and insurance costs.
6.3 Payment of Estimated Expenses. Tenant shall pay estimated
Expenses to Landlord as follows:
6.3.1 Landlord shall submit to Tenant, on or before March 31 of
the first Subsequent Year or as soon thereafter as Landlord has sufficient data,
a reasonably detailed statement showing the Expenses for the Base Year.
6.3.2 For each Subsequent Year, Landlord shall submit to Tenant,
prior to January 1 of such Subsequent Year or as soon thereafter as practicable,
a reasonably detailed statement showing the estimated Expenses for such
Subsequent Year. The determination of estimated Expenses hereunder shall be
made by Landlord based upon Landlord's experience with actual costs and
projections. Tenant shall pay monthly to Landlord an amount equal to the excess
of (a) the sum of the total annual estimated Expenses multiplied by Tenant's
Share minus (b) Landlord's Base Year Costs, over (c) twelve (12) months. If
Landlord does not submit said statement to Tenant prior to January 1 of any such
Subsequent Year, Tenant shall continue to pay its share of estimated Expenses at
the then existing rate until such statement is submitted, and, thereafter, at
the monthly Rent payment date next following the submittal of such statement,
shall pay its share of estimated Expenses based on the rate set forth in such
statement together with any amounts based on such rate which may have
theretofore accrued from January 1 of such Subsequent Year. Landlord may revise
such estimated Expenses at the end of any calendar quarter, and Tenant shall pay
Tenant's Share of such revised estimated Expenses after notice thereof as herein
provided.
6.4 Payment of Actual Expenses. Actual Expenses shall be reconciled
against payments of estimated Expenses as follows:
6.4.1 On or before March 31 of the second Subsequent Year and
each Subsequent Year thereafter, or as soon thereafter as Landlord has
sufficient data (but not later than April 30) Landlord shall submit to Tenant a
reasonably detailed statement showing the actual Expenses paid or incurred by
Landlord during the previous calendar year. If Tenant's Share of such actual
Expenses is less than the amount of estimated Expenses for such previous year
theretofore paid by Tenant, then Landlord shall credit the amount of such
difference against estimated and/or actual Expenses which may thereafter be due
from Tenant; provided, however, that in no event shall Tenant receive a credit
as provided herein for any amount calculated to be less than Landlord's Base
Year Costs. If Tenant's Share of such actual Expenses is more than the amount
of the estimated Expenses for such previous year theretofore paid by Tenant,
then Tenant shall, at the monthly Rent payment date next following the submittal
of such statement to Tenant, pay to Landlord the full amount of such difference.
6.4.2 The reconciliation of the Expenses paid by Tenant for the
calendar year in which this Lease terminates shall be made upon Landlord's
submittal to Tenant of the statement of actual Expenses for such calendar year.
The estimated and actual Expenses for such calendar year shall be prorated based
on the actual number of days in such calendar year that this Lease was in
effect, based on a 360 day year, and shall be compared. If pursuant to such
comparison it is determined that there has been an underpayment or an
overpayment by Tenant for such calendar year, Landlord shall refund the
overpayment to Tenant, or Tenant shall pay the amount calculated as owing to
Landlord, as the case may be, within thirty (30) days after the submittal of the
statement by Landlord. This provision shall survive the expiration or
termination of the Lease. If Landlord deems it advisable, Landlord may submit
partial year statements pursuant to this Section 6.4.2 in order to cause an
earlier reconciliation of Expenses for the calendar year in which this Lease
terminates.
6.5 Other Expense Provision.
6.5.1 Notwithstanding any provision of this Article 6 to the
contrary, if at any time during the term of this Lease any tenant, pursuant to
an express provision in its lease and with Landlord's approval, contracts for
certain Building or Common Area services to be provided directly to it and at
its expense, which services would normally be furnished by Landlord (e.g.,
janitorial, maintenance, utilities, etc.), then Landlord may make an appropriate
adjustment in calculating Tenant's Share of Expenses to the end that the cost of
the remaining services provided by Landlord is shared proportionately by all
tenants receiving such services.
6.5.2 In determining the amount of Expenses hereunder, the
Expenses shall be adjusted to be equal to Landlord's reasonable estimate of
Expenses assuming at least ninety-five percent (95%) of
the total rentable area of the Building was occupied for the entire year, and
assuming the Building was fully completed and fully assessed for property tax
assessment, maintenance and repair purposes.
6.5.3 The computation of Expenses pursuant to this Article
6 is intended to constitute a formula for an agreed sharing of costs by tenants,
and may or may not constitute an exact reimbursement to Landlord for costs paid
by Landlord, and for Landlord's administration.
6.5.4 Any delay or failure of Landlord in computing or billing
for Expenses shall not constitute a waiver of, or in any way impair, the
obligation of Tenant to pay Expenses hereunder. However, Tenant shall not be
charged interest on unpaid Expenses which have accrued during such time that
Landlord has failed to submit a statement for such Expenses.
7. TAXES PAYABLE SOLELY BY TENANT
7.1 In addition to the Rental and Expenses to be paid by Tenant,
Tenant shall pay before delinquency and without notice or demand by Landlord any
and all taxes levied or assessed on and which become payable by Tenant during
the term of this Lease (excluding, however, state and federal personal or
corporate income taxes measured by the income of Landlord from all sources,
capital stock taxes, and estate and inheritance taxes), whether or not now
customary or within the contemplation of the parties hereto, which are based
upon, measured by or otherwise calculated with respect to: (i) the gross or net
Rent payable under this Lease, including, without limitation, any gross receipts
tax or any other gross income tax or excise tax levied by any taxing authority
with respect to the receipt of the Rental hereunder, (ii) the value of Tenant's
equipment, furniture, fixtures or other personal property located in the
Premises; (iii) the possession, lease, operation, management, maintenance,
alteration, repair, use or occupancy by Tenant of the Premises or any portion
thereof; (iv) the value of any improvements, alterations or additions made in or
to the Premises by or on behalf of Tenant, except for those improvements (if
any) installed as part of Landlord's Work (as hereinafter defined) or (v) this
transaction or any document to which Tenant is a party creating or transferring
an interest or an estate in the Premises. Real property taxes on improvements
which are installed as part of Landlord's Work shall be deemed to be included in
the taxes described in Section 6.2.2.3 above, as to which Tenant shall pay
Tenant's Share. If it is not lawful for Tenant to reimburse Landlord for any
such taxes paid or incurred by Landlord, the Rent shall be revised so as to net
Landlord the same net Rent after imposition of such taxes as would have been
payable prior to the imposition of such taxes
8. LATE PAYMENTS
8.1 If Tenant fails to pay to Landlord when due any Rent, Expenses or
other sums owing to Landlord pursuant to the terms of this Lease, said late
payment shall bear interest at the Agreed Rate as herein provided and, in
addition:
8.1.1 For each such late payment that is not paid within five (5)
days after the date the same was due, Tenant shall pay to Landlord a service
charge equal to ten percent (10%) of the overdue amount. Tenant acknowledges
and agrees that such late payment by Tenant will cause Landlord to incur costs
and expenses not contemplated by this Lease, the exact amounts of which will be
extremely difficult to ascertain, and that such service charge represents a fair
estimate of the costs and expenses which Landlord would incur by reason of
Tenant's late payment. Tenant further agrees that such service charge shall
neither constitute a waiver of Tenant's default with respect to such overdue
amount nor prevent Landlord from exercising any other right or remedy available
to Landlord; and
8.1.2 Following any three (3) consecutive late payments of Rent,
Landlord may, upon notice to Tenant:
8.1.2.1 Require that, beginning with the first
payment of Rent due following the date the third (3rd) late payment was due,
Rent shall no longer be paid in monthly installments but shall be payable three
(3) months in advance and, in addition or in the alternative at Landlord's
election,
8.1.2.2 Require that Tenant increase the amount of
any Security Deposit required herein by one hundred percent (100%), which
additional Security Deposit shall be retained by Landlord, and which may be
applied by Landlord, in the manner provided herein with respect to any Security
Deposit required herein.
9. SECURITY DEPOSIT
9.1 Upon Tenant's execution of this Lease, Tenant shall deposit with
Landlord a "Security Deposit" in the amount set forth in Section 1.8 hereof,
which shall be held by Landlord as security for the faithful performance by
Tenant of all of the terms, covenants, and conditions of this Lease, it being
expressly understood and agreed that the deposit is neither an advance Rent
deposit nor a measure of Landlord's damages in case of Tenant's default. If at
any time during the term of this Lease or any extended term thereof Tenant's
Basic Rent is increased pursuant to Article 5 or otherwise, the Security Deposit
shall be increased in the same proportion and Tenant shall deposit cash with
Landlord in an amount sufficient to increase the Security Deposit to the
appropriate amount. The Security Deposit may be retained, used or applied by
Landlord to remedy any default by Tenant, to repair damage caused by Tenant to
any part of the Project, and to clean the Premises upon expiration or earlier
termination of the Lease, as well as to reimburse Landlord for any amount which
Landlord may spend by reason of Tenant's default or to compensate Landlord for
any other loss or damage which Landlord may suffer by reason of Tenant's
default. If any portion of said deposit is so used or applied, Tenant shall,
within ten (10) days after written demand therefore, deposit cash with Landlord
in an amount sufficient to restore said deposit to the full amount required
hereunder, and Tenant's failure to do so shall be a material breach of this
Lease. Landlord shall not be required to keep the Security Deposit separate
from its general funds, and Tenant shall not be entitled to interest on such
deposit. Tenant may not elect to use any portion of said Security Deposit as a
Rental payment although Landlord may elect to do so in the event Tenant is in
default hereunder or is insolvent. 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 enant at Tenant's last known address (or,
at Landlord's option, to the last assignee of Tenant's interest hereunder)
within thirty (30) days after the Lease term has ended and the Premises have
been vacated by Tenant in the manner required by this Lease.
9.2 Letter of Credit
9.2.1 Delivery of L-C. Tenant shall deliver to Landlord
concurrent with Tenant's execution of this Lease, an unconditional, clean,
irrevocable letter of credit with a term of at least one (1) year (the "L-C") in
the amount of Six Hundred Thirty Thousand Dollars ($630,000), which L-C shall be
issued by Chase Manhattan Bank or a money center bank ( a bank which accepts
deposits, maintains accounts and has a local Los Angeles office which will
negotiate a letter of credit, and whose deposits are insured by the FDIC)
reasonably acceptable to Landlord, and which L-C shall be in a form and content
as set forth in Exhibit I, attached hereto. Tenant shall pay expenses, point
and/ or fees incurred by Tenant in obtaining the L-C.
9.2.2. Application of the L-C. The L-C shall be held by the Landlord as
security for the faithful performance by the Tenant of all the terms, covenants
and conditions of this Lease to be kept and performed by Tenant during the Lease
term. The L-C shall not be mortgaged, assigned or encumbered in any manner
whatsoever by Tenant without the prior written consent of Landlord. If Tenant
defaults with respect to any provisions of this Lease, including, but not
limited to, the provisions relating to the payment of Rent, and such default
continues after the expiration of any applicable cure periods, or if the Tenant
fails to renew the L-C at least thirty (30) days before its expiration, Landlord
may, but shall not be required to, draw upon all or any portion of the L-C for
payment of any rent or any other sum in default, or for the payment of any
amount that Landlord may reasonably spend or may become obligated to spend by
reason of Tenant's default, or to compensate Landlord for any other loss or
damage that Landlord may suffer by reason of Tenant's default. In addition,
notwithstanding anything to the contrary herein, Landlord may draw upon all of
the L-C if Tenant fails to renew the L-C at least thirty (30) days before
expiration. The use, application or retention of the L-C or any
portion thereof, by landlord shall not (a) prevent Landlord from exercising any
other right or remedy provided by this Lease or by law, it being intended that
Landlord shall not be first required to proceed against the L-C nor (b) operate
as a limitation on any recovery to which Landlord may otherwise be entitled. Any
amount of the L-C which is drawn upon by Landlord, but is not used or applied by
Landlord shall be held by Landlord and deemed a security deposit ("the L-C
Security deposit"). If any portion of the L-C is drawn upon, Tenant shall,
within five (5) days after written demand therefor, either (I) deposit cash with
Landlord (which cash shall be applied by landlord to the L-C Security deposit)
in an amount sufficient to cause the sum of the L-C Security deposit and the
amount of the remaining L-C to be equivalent to the amount of the L-C then
required under this lease or (ii) reinstate the L-C to the amount then required
under this Lease, and if any portion of the L-C Security Deposit is used or
applied, Tenant shall, within five (5) days after written demand therefor,
deposit cash with Landlord ( which cash shall be applied by Landlord to the L-C
Security Deposit) in an amount sufficient to restore the L-C Security Deposit to
the amount then required under this lease , and Tenant's failure to do so shall
be a default under this Lease. Tenant acknowledges that Landlord has the right
to transfer or mortgage its interest in the Project and the building and in this
Lease and Tenant agrees that in the event of any such transfer or transferee or
mortgagee, and in the event of such transfer, Tenant shall look solely to such
transferee or mortgagee for the return of the L-C Security Deposit and/or the
L-C to the mortgagee for the return of the L-C Security Deposit and or the L-C.
If Tenant is not in default under the Lease after the expiration of any
applicable cure periods, has not been in default under this Lease after the
expiration of any applicable cure periods, and, as of the date of any scheduled
decrease is not in default under this lease after thew expiration of any
applicable cure periods, the L-C amount shall be reduced during the initial
Lease term as follows: effective as of the first day of the second (2nd) lease
year ( as used herein, the term "lease year" shall mean consecutive twelve (12)
month period during the lease term) the L-C amount shall be reduced to Four
Hundred Ninety Seven Thousand Dollars ( $497,500.00); effective as of the first
day of the third (3rd) Lease Year, the L-C amount shall be reduced to Three
Hundred Sixty Five Thousand Dollars ( 365,000.00); effective as of the first day
of the fourth (4th) Lease Year, the L-C amount shall be reduced to Two Hundred
Thirty Two Thousand Five Hundred Dollars ($232,500.00): effective as of the
first day of the fifth (5th) lease year, the L-C amount shall be reduced to One
hundred Thousand Dollars ($100,000) and such amount shall remain in effect for
the balance of the lease term. Notwithstanding the foregoing, if during the
fourth lease year the Tenant provides Landlord with copies of four (4)
consecutive, current and profitable 10Q reduced to zero in the fifth (5th) Lease
year. Notwithstanding, anything to the contrary set forth above, the L-C
decrease shall take place retroactively after such default is cured, provided
such decrease shall not thereafter faithfully perform every provision of this
Lease to be performed by it, the L-C Security Deposit and/ or the L-C or any
balance thereof, if any, shall be returned to Tenant within thirty (30) days
following the expiration of
the Lease term. Notwithstanding anything to the Contrary in this section 9.2,
Landlord shall provide Tenant with two (2) business days' prior notice of its
intention to draw funds from the L-C.
10. TENANT IMPROVEMENTS
10.1 Applicability. If the Premises are being leased on an "As Is"
basis without any improvements, alternations or additions required to be made
thereto by Landlord or Tenant, the provisions of this Article 10 shall not
apply. However, if any improvements, alterations or additions to the Premises
are required to be made by Landlord and/or Tenant, the provisions of the
"Construction Provisions" attached as Exhibit C hereto shall govern with regard
to work to be completed at Landlord's expense ("Landlord's Work"), if any, and
work to be completed at Tenant's expense ("Tenant's Work"), if any. Landlord
has no obligation and has made no promise to alter, remodel, decorate, paint or
otherwise improve the Premises or any part thereof except as specifically set
forth in the Construction Provisions. To the extent Landlord is required to
perform Landlord's Work or Tenant's Work pursuant to the Construction
Provisions, Landlord shall use reasonable diligence to complete such work in a
timely manner.
10.2 Effect on Commencement Date. Time is of the essence in connection
with the delivery to Landlord of each and every drawing, plan, specification,
schedule or other item required to be given by Tenant to Landlord, or to be
approved by Tenant, pursuant to the schedule in and provisions of the
Construction Provisions. If Landlord is delayed in substantially completing
Landlord's and/or Tenant's Work as a result of (i) Tenant's failure to approve
plans, specifications, changes, cost estimates and other items within the time
limits specified therefor in the Construction Provisions, (ii) any change by
Tenant in said plans, specifications, or other items after the expiration of
such time limits or (iii) delays caused by the TI contractor (if such TI
Contractor was proposed by the tenant) then, in any or all such instances and
without limitation as to any other right or remedy available to Landlord, the
six (6)-month period after the Target Commencement Date under Section 3.3 will
be extended for each day of such delay, and Landlord may, under Section 3.1,
determine in its sole discretion that the Commencement Date is the date that
Landlord's and/or Tenant's Work would have been substantially completed but for
such delay. Tenant's failure to perform or cause to be performed Tenant's
obligations within the time limits referred to in the Construction Provisions,
and any delays caused by Tenant, shall not delay commencement of the term or
Tenant's obligation to pay Rent or Expenses hereunder.
10.3 Failure to Approve Plans. If Tenant fails or refuses to approve
the construction drawings for Landlord's Work within forty-five (45) days after
submittal thereof to Tenant, Landlord may, notwithstanding any other provision
hereof and without waiving any of its rights or remedies hereunder, terminate
this Lease upon written notice to Tenant.
11. USE
11.1 The Premises shall be used and occupied by Tenant for general
office purposes and for no other purpose without the prior written consent of
Landlord, which Landlord may withhold in its sole discretion. Tenant
acknowledges that neither Landlord nor any agent of Landlord has made any
representation or warranty with respect to the Premises, the Building, or the
Project, with respect to the suitability thereof for the conduct of Tenant's
business. Tenant shall not do or permit anything to be done in or about the
Premises nor bring or keep anything therein which will in any way increase the
existing rate of or affect or cause a cancellation of any fire or other
insurance covering the Building, Common Area, or the Premises or any of its
contents, nor shall Tenant sell or permit to be kept, used or sold in or about
the Premises any article which may be prohibited by a standard form policy of
insurance. Tenant shall promptly upon demand reimburse Landlord for any
additional premium charged for any such insurance by reason of Tenant's failure
to comply with the provisions of this Article 11. Tenant agrees that it will
use the Premises in such manner as not to interfere with the rights of other
tenants of the Building or Common Area. Tenant shall neither use nor allow the
Premises, Building or Common Area to be used for any unlawful purpose, nor
cause, maintain or permit any nuisance or waste in, on or about any portion of
the Project. Tenant will not place a load upon any floor exceeding the floor
load which such floor was designed to carry, and Landlord reserves the right to
prescribe the location of any safe or other heavy equipment in the Premises.
Tenant shall not use or allow anything to be done in or about the Premises or
the Project which will in any way conflict with any law, ordinance or
governmental regulation or requirement of any board of fire underwriters or any
duly constituted public authority now in force or hereafter enacted or
promulgated affecting the use or occupancy of the Premises, and shall pomptly
comply with all such laws or requirements at its sole cost and expense. The
judgment of any court of competent jurisdiction or any admission by Tenant that
Tenant has violated any such law, statute, ordinance, rule, regulation or
requirement shall be conclusive of such fact as between Landlord and Tenant.
12. SERVICE AND UTILITIES
12.1 Landlord's Obligations. Provided Tenant is not in default
hereunder, Landlord shall as a part of Expenses make available to the Premises
during the Building's normal business hours as set forth in Rule 17 of the Rules
and Regulations described in Article 36 hereof, such amounts of air
conditioning, heating and ventilation as may be required in Landlord's
reasonable judgment for the comfortable use of the Premises, as well as elevator
service, reasonable amounts of electric current for normal lighting by Building
Standard overhead fixtures and for fractional horsepower office machines, and
water for lavatory and drinking purposes. "Building Standard" fixtures and
equipment are as described in Schedule A to Exhibit C attached hereto or, in
absence thereof, as installed in the typical common corridor. Landlord shall as
a part of Expenses replace Building Standard light
bulbs, tubes and ballasts which need replacing due to normal use. Landlord shall
also as a part of Expenses maintain and keep lighted the common stairs, entries
and toilet rooms in the Building and shall provide trash removal, janitorial
service and window washing customary for similar buildings in the same
geographical area. Except to the extent caused by Landlord's negligence,
Landlord shall not be in default hereunder or liable for any damages directly or
indirectly resulting from, nor shall the Rent be abated or shall there be deemed
a constructive or other eviction of Tenant by reason of (i) the installation,
use or interruption of use of any equipment in connection with the furnishing of
any of the foregoing utilities and services, (ii) failure to furnish, or delay
in furnishing, any such utilities or services when such failure or delay is
caused by acts of God, acts of government, labor disturbances of any kind, or
other conditions beyond the reasonable control of Landlord, or by the making of
repairs or improvements to the Premises or any part of the Project, or (iii)
governmental limitation, curtailment, rationing or restriction on use o water,
electricity or any other service or utility whatsoever serving the Premises,
Building or Common Area. Landlord shall be entitled to cooperate with the energy
conservation efforts of governmental agencies or utility suppliers. The failure
of Landlord to provide such services if consistent with the foregoing shall not
constitute a constructive or other eviction of Tenant.
12.2 After-Hours Charges. During non-business hours Landlord shall as
a part of Expenses keep the public areas of the Building lighted and shall
provide elevator service with at least (1) elevator, but shall not be obligated
to furnish ventilation or air conditioning to the Premises. If Tenant requires
ventilation and/or air conditioning during non-business hours Tenant shall give
Landlord at least twenty-four (24) hours prior notice of such requirement or
shall follow such other procedure for activating the building energy management
system as Landlord may advise Tenant, and Tenant shall pay Landlord the "After-
Hours Charges" for such extra service at the rate set forth in Section 1.6
hereof. Such rates are subject to increase from time to time based on increases
in Landlord's costs associated with providing such extra services. All payment
required for After-Hours Charges shall be deemed to be Additional Rent and
Landlord shall have the same remedies for a default in payment thereof as for a
default in payment of Rent.
12.3 Tenant's Obligations. Tenant shall pay, prior to delinquency, for
all telephone charges and all other materials and services not expressly
required to be paid by Landlord, which may be furnished to or used in, on or
about the Premises during the term of this Lease. Tenant shall also pay, as
Additional Rent, all charges and fees required to be paid by Tenant by the Rules
and Regulations described in Article 36 of this Lease.
12.4 Excess Utility Usage. Tenant will not without the prior written
consent of Landlord use any apparatus or device in the Premises, including
(without limitation) electronic data processing machines, punch card machines,
and telephone switchgear, which will
materially increase the amount of cooling or ventilation or electricity or water
usually furnished or supplied for use of the Premises as general office space;
nor shall Tenant connect with electric current (except through existing
electrical outlets in the Premises) or water pipes, any apparatus or device for
the purpose of using electrical current or water, except as may be provided in
the Construction Provisions. If Tenant uses electricity at a rate in excess of
that normally provided for general office space, the cost to Landlord of any
such excess use of utility service by Tenant shall be paid by Tenant based on
Landlord's reasonable estimates and costs. If Tenant requires or uses
ventilation, cooling, water or electric current or any other resource in excess
of that usually furnished or supplied for use of the Premises as general office
space, Landlord may cause a special meter or other measuring device to be
installed in or about the Premises to measure the amount of water, electric
current or other resource consumed by Tenant. The cost of any such meter, and of
the installation, maintenance and repair thereof, shall be paid for by Tenant,
and Tenant agrees to pay Landlord promptly upon demand for all such water,
electric current or other resource consumed, as shown by said meter, at the
rates charged by the local public utility or other supplier furnishing the same,
plus any additional expense incurred by Landlord in keeping account of the
foregoing and administering same. 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 heating,
ventilation or air conditioning system, or generate substantially more heat in
the Premises han would be generated by Building Standard lights or usual
fractional horsepower office equipment, Landlord shall have the right to install
any machinery and equipment which Landlord deems necessary to restore the
temperature balance in any affected part of the Building, including but not
limited to modifications to the Building 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. Any sums payable under this Section 12.4 shall be
considered Additional Rent, and Landlord shall have the same remedies for a
default in payment of such sum as for a default in the payment of Rent.
13. ENTRY BY LANDLORD
13.1 Landlord and its authorized representatives shall have the right
to enter the Premises at all reasonable times during normal business hours and
at any time in case of an emergency (i) to determine whether the Premises are in
good condition and whether Tenant is complying with its obligations under this
Lease, (ii) to maintain or to make any repair or restoration to the Building
that Landlord has the right or obligation to perform, (iii) to install any
meters or other equipment which Landlord may have the right to install, (iv) to
serve, post, or keep posted any notices required or allowed under the provisions
of this Lease, (v) to post "for sale" signs at any time during the term, and to
post "for rent" or "for lease" signs during the last three (3) months of the
term or during any period while Tenant is in default, (vi) to show the Premises
to prospective brokers, agents, buyers, tenants, or persons interested in an
exchange, (vii) to shore the foundations, footings, and walls of the Building
and to erect scaffolding and protective barricades around and about the Building
or the Premises, but not so as to prevent entry into the Premises, and (viii) to
do any other act or thing necessary for the safety or preservation of the
Premises or the Building. Landlord shall have the right at all times to have
and retain a key with which to unlock all doors in, upon and about the Premises
excluding Tenant's vaults and safes, and Landlord shall have the right to use
any and all means which Landlord may deem proper to gain entry in an emergency,
and any entry to the Premises obtained by Landlord in accordance with the
foregoing shall not be construed or deemed to be a forcible or unlawful entry
into, or a detainer of, the Premises, or an eviction of Tenant from the Premises
or any portion thereof. Tenant hereby waives any claim for damages for any
injury or inconvenience to or interference with Tenant's business and any loss
of occupancy or quiet enjoyment of the Premises by reason of Landlord's exercise
of its rights of etry in accordance with this Article 13, and Tenant shall not
be entitled to an abatement or reduction of Rent or Expenses in connection
therewith.
14. MAINTENANCE AND REPAIR
14.1 Landlord's Obligations. Landlord shall as part of Expenses
maintain or cause to be maintained in good order, condition and repair the
Building's heating, ventilating, air conditioning and plumbing systems and the
structural and common portions of the Building and all Common Areas in the
Project (except to the extent of damage caused by Tenant which shall be repaired
by Landlord at Tenant's expense). Landlord shall not be liable, and neither
Rent nor Expenses shall be abated, for any failure by Landlord to maintain and
repair areas which are being used in connection with construction or
reconstruction of improvements, or for any failure to make any repairs or
perform any maintenance, unless such failure shall persist for more than thirty
(30) days after written notice of the need thereof is given to Landlord by
Tenant. Landlord shall diligently prosecute to completion all repairs to the
components of the "essential services" (as defined in Section 23.1). To the
extent the provisions of this Article 14 are
in conflict with any statute now or hereafter in effect which would afford
Tenant the right to make repairs at Landlord's expense or to terminate this
Lease, the provisions of this Article 14 shall govern.
14.2 Tenant's Obligations
14.2.1 Tenant shall, at its sole cost and expense, except for
janitorial services furnished by Landlord pursuant to Article 12 hereof,
maintain the Premises including all improvements therein in good order,
condition and repair.
14.2.2 In connection with Tenant surrendering possession of the
Premises at the end of the Lease term, Tenant agrees to repair any damage caused
by or in connection with the removal of any article of personal property,
business or trade fixtures, machinery, equipment, cabinetwork, furniture,
movable partitions or permanent improvements or additions, including without
limitation thereto, repairing the floor and patching and painting the walls
where required by Landlord to Landlord's reasonable satisfaction, all at
Tenant's sole cost and expense. Tenant shall indemnify, defend and hold
Landlord harmless against any loss, liability, cost or expense (including
reasonable attorneys' fees) resulting from delay by Tenant in so surrendering
the Premises. Tenant's obligation hereunder shall survive the expiration or
termination of this Lease.
14.2.3 If Tenant fails to maintain the Premises in good order,
condition and repair, Landlord may give Tenant notice to do such acts as are
reasonably required to so maintain the Premises. If Tenant thereafter fails to
promptly commence such work and diligently prosecute it to completion, then
Landlord shall have the right to do such acts and expend such funds at the
expense of Tenant as are reasonably required to perform such work. Any amount
so expended by Landlord [together with a charge for Landlord's administration
and overhead equal to three percent (3%) thereof] shall be paid by Tenant
promptly after demand, with interest at the Agreed Rate from the date of such
work. Landlord shall have no liability to Tenant for any inconvenience or
interference with the use of the Premises by Tenant as a result of performing
any such work.
14.3 Compliance with Law. Landlord and Tenant shall each do all acts
required to comply with all applicable laws, ordinances, and rules of any public
authority relating to their respective maintenance obligations as set forth
herein.
15. ALTERATIONS AND ADDITIONS
15.1 Tenant shall make no alterations, additions or improvements to the
Premises or any part thereof having a cost in excess of Ten Thousand Dollars
($10,000) or which affects the exterior appearance of the Premises or the
Building or any common portion of the Building or any portion of the Common Area
or the electrical, mechanical, plumbing or other systems in the Building,
without obtaining the prior written consent of Landlord in each instance. Such
consent shall not be
unreasonably withheld. Any such alterations, additions or improvements consented
to by Landlord may, at Landlord's option, be made by Landlord for Tenant's
account and Tenant shall reimburse Landlord for the cost thereof (together with
a charge for Landlord's administration and management thereof equal to five
percent (5%) of the cost incurred) within thirty (30) days after an invoice
therefor is submitted to Tenant. Landlord may impose as a condition to such
consent such requirements as Landlord may deem necessary in its sole discretion,
including without limitation the requirement that Landlord be furnished with
working drawings before work commences and that a bond be furnished, and
requirements relating to the manner in which the work is done, the contractor by
whom it is performed, and the times during which it is accomplished, as well as
the requirement that upon written request of Landlord prior to the expiration or
earlier termination of the Lease, Tenant will remove at its expense any such
alterations, improvements or additions to the Premises. Any damage done to the
Premises in connection with any such removal shall be repaired at Tenant's sole
cost and expense. Landlord may, in connection with any such removal which
reasonably might involve damaging the Premises, require that such removal be
performed by a bonded contractor or other person for which a bond satisfactory
to Landlord has been furnished covering the cost of repairing the anticipated
damage. Unless so removed, all such alterations, additions or improvements shall
at the xpiration or earlier termination of the Lease become the property of
Landlord and remain upon the Premises. All such improvements, alterations or
additions must be done in a good and workmanlike manner and diligently
prosecuted to completion so that the Premises shall at all times be a complete
unit except during the period of work. Such improvements, alterations or
additions shall only be constructed by a contractor which is bondable and which
shall use union employees only, except that such contractor may use non-union
employees only if prior to the commencement of any work Tenant obtains
Landlord's written consent which Landlord may withhold unless it is adequately
protected against any and all loss or damage that may result from labor problems
or any work stoppage or interruption arising from the use of such non-union
employees. Tenant shall deliver to Landlord upon commencement of such work a
copy of the building permit with respect thereto. Upon completion of such work
Tenant shall file for record in the office of the County Recorder where the
Project is located a Notice of Completion, as required or permitted by law. All
such work shall be performed and done strictly in accordance with the laws and
ordinances relating thereto and shall be performed so as not to obstruct the
access to the premises of any other tenant in the Building or Project. Tenant
agrees to carry insurance as required by Article 17 covering any improvements,
alterations or additions to the Premises made by Tenant under the provisions of
this Article 15, it being expressly agreed that none of such improvements,
additions or alterations shall be insured by Landlord under the insurance
Landlord may carry upon the Building, nor shall Landlord be required under any
provision for reconstruction to reinstall any such improvements, additions or
alterations. In addition, it is expressly agreed that if any tax is imposed, or
the amount of taxes on the Building or the Project is
increased, by reason of any such improvements, alterations or additions, Tenant
shall be solely responsible therefor under Article 7.
16. INDEMNITY
16.1 Indemnification by Tenant. Tenant shall indemnify, defend and
hold Landlord, its agents and employees, harmless from and against any and all
claims, liability, loss, cost or expense (including reasonable attorneys' fees)
arising out of or in connection with (i) any injury or damage to any person or
property occurring in, on or about the Premises or any part thereof or the
Building or Common Area, if such injury or damage is caused in part or in whole
by any act or omission by Tenant, its agents, contractors, employees or invitees
or (ii) any breach or default in the performance of any obligation on Tenant's
part to be performed under this Lease. If any action or proceeding is brought
against Landlord by reason of any such claim, upon notice from Landlord, Tenant
shall defend the same at Tenant's expense by counsel reasonably satisfactory to
Landlord. Tenant, as a material part of the consideration to Landlord, hereby
assumes all risk of damage to property or injury to persons in, upon or about
the Premises from any cause except Landlord's negligence or wrongful acts, and
Tenant hereby waives all claims with respect thereto against Landlord. The
foregoing provisions shall survive the termination of this Lease.
16.2 Exemption of Landlord from Liability. If the Premises, the
Building, or the Common Area, or any part thereof, is damaged by fire or other
cause against which Tenant is required to carry insurance pursuant to this
Lease, Landlord shall not be liable to Tenant for any loss, cost or expense
(including attorney's fees) arising out of or in connection with such damage.
Tenant hereby releases Landlord, its directors, officers, shareholders,
partners, employees, agents and representatives, from any liability, claim or
action arising out of or in connection with such damage. Furthermore, Tenant
shall, pursuant to Article 17, maintain insurance against loss, injury, or
damage which may be sustained by the person, goods, wares, merchandise or
property of Tenant, its agents, contractors, employees, invitees or customers,
or any other person in or about the Premises, caused by or resulting from fire,
steam, electricity, gas, water, or rain, which may leak or flow from or into any
part of the Premises or the Building, or from the breakage, leakage, obstruction
or other defects of the pipes, sprinklers, wires, appliances, plumbing, air
conditioning or lighting fixtures of the same, whether such damage or injury
results from conditions arising within the Premises or other portions of the
Building, or from other sources, and Landlord shall not be liable therefor,
unless caused by Landlord's negligence or wrongful act, and in that event only
to the extent not covered by the insurance which Tenant is required to carry
pursuant to this Lease. Landlord shall not be liable to Tenant for any damages
arising out of or in connection with any act or omission of any other tenant in
the Project or for losses due to theft or burglary or other wrongful acts of
third parties.
16.3 Indemnification by Landlord. Landlord shall indemnify, defend
and hold Tenant, its agents and employees, harmless from and against any and all
claims, liability, loss cost expense (including reasonable attorneys' fees)
arising out of or in connection with (I) any injury or damage to any person or
property occurring in, on or about the Building or Common Area, if such injury
or damage is caused in part or in whole by any act or omission by Landlord, its
agents, contractors, employees or invitees or (ii) any breach or default in the
performance of any obligation on Landlord's part to be performed under this
lease. If any action or proceeding is brought against Tenant by reason of any
such claim, upon notice from Tenant, Landlord shall defend the same at
Landlord's expense. The foregoing provisions shall survive the termination of
this Lease.
17. INSURANCE
17.1 General. All insurance required to be carried by Tenant hereunder
shall be issued by responsible insurance companies acceptable to Landlord and
the holder of any deed of trust or mortgage secured by any portion of the
Premises (hereinafter referred to as a "Mortgagee"). All policies of insurance
provided for herein shall be issued by insurance companies with general
policyholder's rating of not less than A and a financial rating of not less than
Class X as rated in the most current available "Best Insurance Reports". Each
policy shall name Landlord and at Landlord's request any Mortgagee, and an agent
of Landlord as an additional insured, as their respective interests may appear.
Tenant shall deliver certificates of such insurance to Landlord, evidencing the
existence and amounts of such insurance, at least ten (10) days prior to
Tenant's occupancy in the Premises. Failure to make such delivery shall
constitute a material default by Tenant under this Lease. All policies of
insurance delivered to Landlord must contain a provision that the company
writing said policy will give Landlord thirty (30) days prior written notice of
any modification, cancellation or lapse or reduction in the amounts of
insurance. All public liability, property damage and other casualty insurance
policies shall be written as primary policies, not contributing with, and not in
excess of coverage which Landlord may carry. Tenant shall furnish Landlord with
renewals or "binders" of any such policy at least thirty (30) days prior to the
expiration thereof. Tenant agrees that if Tenant does not procure and maintain
such insurance, Landlord may (but shall not be required to) obtain such
insurance on Tenant's behalf and charge Tenant the premiums therefor together
with a twenty-five percent (25%) handling charge, payable upon demand. Tenant
may carry such insurance under a blanket policy provided such blanket policy
expressly affords the coverage required by this Lease by a Landlord's protective
liability endorsement or otherwise and evidence thereof is furnished to Landlord
as required above.
17.2 Property Insurance. At all times during the term hereof, Tenant
shall maintain in effect policies of property insurance covering (i) all
improvements in, on or to the Premises (including any
Building Standard furnishings, and any alterations, additions or improvements as
may be made by Tenant), and (ii) trade fixtures, merchandise and other personal
property from time to time in, on or upon the Premises. Such policies shall
include coverage in an amount not less than one hundred percent (100%) of the
actual replacement cost thereof from time to time during the term of this Lease.
Such policies shall provide protection against any peril included within the
classification "All Risk", against vandalism and malicious mischief, theft,
sprinkler leakage, earthquake sprinkler leakage, and against flood damage (and
including cost of demolition and debris removal). Replacement cost for purposes
hereof shall be determined by an accredited appraiser selected by Landlord or
otherwise by mutual agreement. The proceeds of such insurance shall be used for
the repair or replacement of the property so insured. Upon termination of this
Lease following a casualty as set forth in Article 18, the proceeds under (i)
above shall be paid to Landlord, and the proceeds under (ii) above shall be paid
to Tenant.
17.3 Liability Insurance. Tenant shall at all times during the term
hereof obtain and continue in force bodily injury liability and property damage
liability insurance adequate to protect Landlord against liability for injury to
or death of any person in connection with the activities of Tenant in, on or
about the Premises or with the use, operation or condition of the Premises.
Such insurance at all times shall be in an amount of not less than Two Million
Dollars ($2,000,000) for injuries to persons in one (1) accident, not less than
One Million Dollars ($1,000,000) for injury to any one (1) person and not less
than Five Hundred Thousand Dollars ($500,000) with respect to damage to
property. The limits of such insurance do not necessarily limit the liability
of Tenant hereunder. All public liability and property damage policies shall
contain a provision that Landlord, although named as an insured, shall
nevertheless be entitled to recovery under said policies for any loss occasioned
to it, its partners, agents and employees by reason of the negligence of Tenant.
17.4 Workers' Compensation Insurance. Tenant shall, at all times
during the term hereof, maintain in effect workers' compensation insurance as
required by applicable statutes.
17.5 Adjustment. Every three (3) years during the term of this Lease,
or whenever Tenant materially improves or alters the Premises, whichever is
earlier, Landlord and Tenant shall mutually agree to increases in Tenant's
insurance policy limits for the insurance to be carried by Tenant as set forth
in this Article 17. If Landlord and Tenant cannot mutually agree upon the
amount of said increases within thirty (30) days after notice from Landlord,
then the insurance policy limits set forth in this Article 17 shall be adjusted
upward by an accredited insurance appraiser approved by Landlord to reflect
increased replacement costs and increased limits of liability then prevailing
generally in the local real estate industry for comparable property.
17.6 Landlord's Insurance. Landlord shall at all times from and
after substantial completion of the Premises maintain in effect as an item of
Expense a policy or policies of insurance covering the Common Area and the
buildings in the Project in an amount up to one hundred percent (100%) of the
actual replacement cost thereof (exclusive of the cost of excavations,
foundations and footings) from time to time during the term of this Lease,
providing protection against rental loss and any peril generally included in the
classification "Fire and Extended Coverage" which may include insurance against
sprinkler damage, vandalism, malicious mischief, earthquake and third party
liability, and including such coverage in such amounts as Landlord may
designate. Landlord's obligation to carry the insurance provided for herein may
be brought within the coverage of any so-called blanket policy or policies of
insurance carried and maintained by Landlord provided that the coverage afforded
will not be reduced or diminished by reason of the use of such blanket policy of
insurance.
17.7 Waiver of Subrogation. Landlord and Tenant each hereby waive any
and all rights of recovery against the other or against the directors, officers,
shareholders, partners, employees, agents and representatives of the other, on
account of loss or damage of such waiving party or its property, or the property
of others under its control, to the extent that such loss or damage is insured
against under any fire and extended coverage insurance policy which either may
have in force at the time of such loss or damage. Tenant shall, upon obtaining
the policies of insurance required under this Lease, give notice to its
insurance carrier(s) that the foregoing mutual waiver of subrogation is
contained in this Lease. The waivers set forth herein shall be required to the
extent that same are available from each party's insurer without additional
premium, if an extra charge is incurred to obtain such waiver, it shall be paid
by the party in whose favor the waiver runs within fifteen (15) days after
written notice from the other party.
18. DAMAGE AND DESTRUCTION
18.1 Partial Damage-Insured. If the Premises, Building or Common Area
are damaged by a risk covered under fire and extended coverage insurance
protecting Landlord, then Landlord shall restore such damage provided insurance
proceeds are available to Landlord to pay eighty percent (80%) or more of the
cost of restoration, and provided such restoration by Landlord can be completed
within six (6) months after the commencement of work, in the opinion of a
registered architect or engineer appointed by Landlord. In such event this
Lease shall continue in full force and effect so long as the Premises can be
used by Tenant, except that Tenant shall, so long as the damage is not due to
the act or omission of Tenant, be entitled to an equitable reduction of Rent and
Expenses while such restoration takes place, such reduction to be based upon the
extent to which the damage and the restoration efforts directly and materially
interfere with Tenant's use of the Premises.
18.2 Partial Damage-Uninsured. If the Premises, Building or Common
Area are damaged by a risk not covered by such insurance or the
insurance proceeds available to Landlord are less than eighty percent (80%) of
the cost of restoration, or if the restoration cannot be completed within six
(6) months after the commencement of work in the opinion of the registered
architect or engineer appointed by Landlord, then Landlord shall have the option
either to (i) repair or restore such damage, this Lease continuing in full force
and effect so long as the Premises can be used by Tenant, but the Rent and
Expenses to be equitably reduced as hereinabove provided, or (ii) give notice to
Tenant at any time within ninety (90) days after such damage terminating this
Lease as of a date to be specified in such notice, which date shall be not less
than thirty (30) nor more than sixty (60) days after giving such notice. If such
notice is given, this Lease shall expire and any interest of Tenant in the
Premises shall terminate on the date specified in such notice and the Rent and
Expenses, reduced by an equitable reduction (except as hereinabove provided)
based upon the extent, if any, to which such damage directly and materially
interfered with Tenant's use of the Premises, shall be paid to the date of such
termination, and Landlord agrees to refund to Tenant any Rent or Expenses
theretofore paid in advance for any period of time subsequent to such
termination date.
18.3 Total Destruction. If the Premises are totally destroyed [i.e.,
over eighty percent (80%) of the Premises is destroyed or if Tenant cannot use
the Premises without major restoration] or if in Landlord's judgment the
Premises cannot be restored as set forth above, then, notwithstanding the
availability of insurance proceeds, this Lease shall be terminated effective as
of the date of the damage.
18.4 Landlord's Obligation. Landlord shall not be required to carry
insurance of any kind on Tenant's property and shall not in the absence of
Landlord's negligence or wrongful acts be required to repair any injury or
damage thereto by fire or other cause, or to make any restoration or replacement
of any paneling, decorations, partitions, ceilings, floor covering, office
fixtures or any other improvements or property installed in the Premises by or
at the direct or indirect expense of Tenant, and Tenant shall be required to
restore or replace same in the event of damage and shall have no claim against
Landlord for any loss suffered by reason of any such damage, destruction, repair
or restoration. Notwithstanding anything to the contrary contained in this
Article 18, Landlord shall have the option not to repair, reconstruct or restore
the Premises with respect to damage or destruction as described in this Article
18 occurring during the last twelve (12) months of the term of this Lease or any
extension thereof, provided, however, that if Landlord exercises such option
this Lease shall be terminated upon such exercise.
18.5 Waiver by Tenant. It is expressly agreed that this Article 18
shall govern the rights of Landlord and Tenant in the event of damage and
destruction and supersedes the provisions of any statutes with respect to any
damage or destruction of the Premises.
19. CONDEMNATION
19.1 If all or a substantial part of the Premises, Building or Common
Area is taken or appropriated for public or quasi-public use by the right of
eminent domain or otherwise by a taking in the nature of inverse condemnation,
with or without litigation, or is transferred by agreement in lieu thereof (any
of the foregoing being referred to herein as a "taking"), either party hereto
may, by written notice given to the other within thirty (30) days of receipt of
notice of such taking, elect to terminate this Lease as of the date possession
is transferred pursuant to the taking; provided, however, that before such party
may terminate this Lease for a taking, such taking shall be of such an extent
and nature as to economically frustrate its business therein, or to
substantially handicap, impede or impair its use thereof. No award for any
partial or entire taking shall be apportioned, and Tenant hereby assigns to
Landlord any and all rights of Tenant now or hereafter arising in or to the same
or any part thereof; provided, however, that Tenant may file a separate claim
for an award and 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 belonging to Tenant. In the event of
a taking which does not result in a termination of this Lease, Rent and Expenses
shall be equitably reduced to the extent Tenant's business in or use of the
Premises is economically impaired as described above. No temporary taking of
the Premises or any part of the Project shall terminate this Lease, or give
Tenant any right to any abatement of Rent or Expenses hereunder, except that
Rent and Expenses shall be equitably reduced as described above during that
portion of any temporary taking lasting more than thirty (30) days. To the
extent the provisions of this Article 19 conflict with California Code of Civil
Procedure Section 1265.130 allowing either party to petition the court to
terminate this Lease for a partial taking, the provisions of this Article 19
shall govern.
20. LIENS
20.1 Tenant shall keep the Premises, the Building and the Project free
from any liens arising out of work performed, materials furnished, or
obligations incurred by Tenant, and shall indemnify, hold harmless and defend
Landlord from any liens and encumbrances arising out of any work performed or
materials furnished by or at the direction of Tenant. Tenant shall give
Landlord at least ten (10) business days' prior written notice of the expected
date of commencement of work relating to alterations, improvements, or additions
to the Premises and if requested by Landlord shall secure a completion and
indemnity bond for said work, satisfactory to Landlord, in an amount at least
equal to one and one-half (1 1/2) times the estimated cost of such work.
Landlord shall have the right at all times to keep posted on the Premises any
notices permitted or required by law, or which Landlord shall deem proper, for
the protection of Landlord and the Premises, and any other party having any
interest therein, against mechanics' and materialmen's liens. If any claim of
lien is filed against the Premises or any part of the Project or any similar
action affecting title to such property is commenced, the party receiving notice
of such lien or action shall immediately give
the other party written notice thereof. If Tenant fails, within twenty (20) days
following the imposition of any lien, to cause such lien to be released of
record by payment or posting of a proper bond, Landlord shall have, in addition
to all other remedies provided herein and by law, the right (but not the
obligation) to cause the same to be released by such means as it shall deem
proper, including payment of the claim giving rise to such lien. All such sums
paid by Landlord and all costs and expenses incurred by it in connection
therewith (including reasonable attorneys' fees) shall be payable to Landlord by
Tenant on demand, with interest at the Agreed Rate from the date of expenditure.
21. DEFAULTS BY TENANT
21.1 The occurrence of any one or more of the following events shall
constitute a material default and breach of this Lease by Tenant:
21.1.1 The abandonment of the Premises by Tenant.
21.1.2 The failure by Tenant to make any payment of Rent or
Expenses or the Concession Advance (as hereinafter defined) or of any other sum
required to be made by Tenant hereunder, as and when due.
21.1.3 The failure by Tenant to observe or perform any of the
covenants, conditions or provisions of this Lease to be observed or performed by
Tenant, if such failure is not cured within thirty (30) days after written
notice thereof from Landlord to Tenant; provided, however, that if the nature of
Tenant's default is such that it cannot be cured solely by payment of money and
more than thirty (30) days are reasonably required for its cure, then Tenant
shall not be deemed to be in default if Tenant commences such cure within the
thirty (30) day period and thereafter diligently prosecutes such cure to
completion; provided, further, that repeated breaches or defaults by Tenant
(more than three (3) in any twelve (12) month period) shall entitle Landlord at
its option, to terminate this Lease unless Tenant furnishes Landlord with
adequate assurances, in Landlord's sole judgment, against further defaults; and
provided, further, that violations by Tenant of the Rules and Regulations
described in Article 36 which interfere with the rights of other tenants or
which constitute a nuisance or hazard shall be cured by Tenant within forty-
eight (48) hours after written notice thereof from Landlord, failing which
Landlord may (but need not) cure same, in which event Tenant shall pay Landlord,
within ten (10) days after written notice thereof by Landlord, the amount
expended by Landlord to effect such cure together with an administrative charge
of fifteen percent (15%) of the amount thereof.
21.1.4 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 for reorganization or arrangement
under any law relating to bankruptcy
[unless, in the case of a petition filed against Tenant, the same is dismissed
within sixty (60) days] or, the appointment of a trustee or receiver to take
possession of, 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.
21.2 Any notice required or permitted by this Article 21 is intended to
satisfy to the maximum extent possible any and all notice requirements imposed
by law on Landlord. Landlord may serve a statutory notice to quit, a statutory
notice to pay rent or quit, or a statutory notice of default, as the case may
be, to effect the giving of any notice required by this Article 21.
22. LANDLORD'S REMEDIES
22.1 In the event of any material default or breach of this Lease by
Tenant, Landlord's obligations under this Lease shall be suspended and Landlord
may at any time thereafter, without limiting Landlord in the exercise of any
other right or remedy at law or in equity which Landlord may have (all remedies
provided herein being non-exclusive and cumulative), do any one or more of the
following:
22.1.1 Maintain this Lease in full force and effect and recover
the Rent, Expenses and other monetary charges as they become due, without
terminating Tenant's right to possession irrespective of whether Tenant shall
have abandoned the Premises. If Landlord does not elect to terminate the Lease,
Landlord shall have the right to attempt to relet the Premises at such rent and
upon such conditions, and for such a term, as Landlord deems appropriate in its
sole discretion and to do all acts necessary with regard thereto, without being
deemed to have elected to terminate the Lease, including re-entering the
Premises to make repairs or to maintain or modify the Premises, and removing all
persons and property from the Premises, which property if removed may at
Landlord's election be abandoned or stored in a public warehouse or elsewhere at
the cost of and for the account of Tenant. Reletting may be for a period
shorter or longer than the remaining term of this Lease, and for more or less
rent, but Landlord shall have no obligation to relet at less than prevailing
market rental rates. If reletting occurs, this Lease shall terminate
automatically when the new tenant takes possession of the Premises and commences
rent payment. Notwithstanding that Landlord fails to elect to terminate the
Lease initially, Landlord at any time thereafter may elect to terminate the
Lease by virtue of any uncured default by Tenant. In the event of any such
termination, Landlord shall be entitled to recover from Tenant any and all
damages incurred by Landlord by reason of Tenant's default (including, without
limitation, the damages described in Section 22.1.2 below), as well as all costs
of reletting, including commissions, reasonable attorneys' fees, restoration or
remodeling costs, and costs of advertising.
22.1.2 Terminate Tenant's right to possession by any lawful means,
in which case this Lease shall terminate and Tenant
shall immediately surrender possession of the Premises to Landlord. In such
event Landlord shall be entitled to recover from Tenant all damages incurred by
Landlord by reason of Tenant's default including (without limitation) the
following: (1) the worth at the time of award of any unpaid Rent which had been
earned at the time of such termination; plus (2) the worth at the time of award
of the amount by which the unpaid Rent which would have been earned after
termination until the time of award exceeds the amount of such Rent loss that
Tenant proves could have been reasonably avoided; plus (3) the worth at the time
of award of the amount by which the unpaid Rent for the balance of the term
after the time of award exceeds the amount of such Rent loss that Tenant proves
could have been reasonably avoided; plus (4) any other amount, and court costs,
necessary to compensate Landlord for all the detriment proximately caused by
Tenant's default or which in the ordinary course of things would be likely to
result therefrom (including, without limiting the generality of the foregoing,
the amount of any commissions and/or finder's fee for a replacement tenant);
plus (5) 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. As used
in subparagraphs (1) and (2) of this Section 22.1.2, the "worth at the time of
award" is to be computed by allowing interest at the then maximum rate of
interest allowable under law which could be charged Tenant by Landlord, and, as
used in subparagraph (3) of this Section 22.1.2, the "worth at the time of
award" is to be computed by discounting such amount at the discount rate of the
U. S. Federal Reserve Bank of San Francisco at the time of award, plus one
percent (1%). The term "Rent", as used in this Article 22, shall be deemed to be
and to mean all Rent, Expenses, parking fees and other moneary sums required to
be paid by Tenant pursuant to this Lease or as defined in Section 4.1 hereof.
For the purpose of determining the amount of "unpaid Rent which would have been
earned after termination" or the "unpaid Rent for the balance of the term" (as
referenced in subparagraphs (2) and (3) hereof), the amount of parking fees and
Expenses shall be deemed to increase annually for the balance of the term by an
amount equal to the average annual percentage increase in parking fees and
Expenses during the three (3) calendar years preceding the year in which the
Lease was terminated, or, if such termination shall occur prior to the
expiration of the third calendar year occurring during the term of this Lease,
then the amount of parking fees and Expenses shall be deemed to increase monthly
for the balance of the term by an amount equal to the average monthly percentage
increase in parking fees and Expenses during all of the calendar months
preceding the month in which the Lease was terminated.
22.1.3 Collect sublease rents (or appoint a receiver to collect
such rent) and otherwise perform Tenant's obligations at the Premises, it being
agreed, however, that neither the filing of a petition for the appointment of a
receiver for Tenant nor the appointment itself shall constitute an election by
Landlord to terminate this Lease.
22.1.4 Proceed to cure the default at Tenant's sole cost and
expense, without waiving or releasing Tenant from any obligation hereunder. If
at any time Landlord pays any sum or incurs any expense as a result of or in
connection with curing any default of Tenant (including any administrative fees
provided for herein and reasonable attorneys' fees), the amount thereof shall be
immediately due as of the date of such expenditure and, together with interest
at the Agreed Rate from the date of such expenditures, shall be paid by Tenant
to Landlord immediately upon demand, and Tenant hereby covenants to pay any and
all such sums.
22.1.5 If Tenant is not occupying the Premises, retain possession
of all of Tenant's fixtures, furniture, equipment, improvements, additions and
other personal property left in the Premises or, at Landlord's option, at any
time, to require Tenant to forthwith remove same, and if not so removed to deem
them abandoned and dispose of same.
22.1.6 Additional Remedies. Upon the occurrence of any of the
events specified in Section 21.1.4 or Section 21.1.5, if Landlord shall elect
not to exercise, or by law shall not be able to exercise, its right hereunder to
terminate this Lease, then, in addition to any other rights or remedies of
Landlord under this Lease or provided by law, (i) Landlord shall not be
obligated to provide Tenant with any of the services specified in Article 12, or
otherwise specified in the Lease unless Landlord has received compensation in
advance for such services, and the parties agree that Landlord's reasonable
estimate of the compensation required with respect to such services shall
control; and (ii) neither Tenant, as debtor in possession, nor any trustee or
other person (collectively, the "Assuming Tenant") shall be entitled to assume
this Lease, unless on or before the date of such assumption, the Assuming Tenant
(A) cures, or provides adequate assurance that such Assuming Tenant will
promptly cure, any existing default under this Lease; (B) compensates, or
provides adequate assurance that the Assuming Tenant will promptly compensate
Landlord for any loss (including, without limitation, reasonable attorneys' fees
and disbursements, including on appeal and in connection with any bankruptcy)
resulting from such default; and (C) provides adequate assurance of future
performance under this Lease. Tenant covenants and agrees that, for such
purposes (i) any cure or compensation shall be effected by the immediate payment
of any monetary default or any required compensation, or the immediate
correction acceptable to Landlord of any non-monetary default; (ii) any
"adequate assurance" of such cure or compensation shall be effected by the
establishment of an escrow fund for the amount at issue or by other method
acceptable to Landlord; and (iii) "adequate assurance" of future performance
shall be effected by the establishment of an escrow fund for the amount at issue
or other method acceptable to Landlord. Provided, further, upon the occurrence
of any of the events specified in Section 21.1.4 prior to the date fixed as the
Commencement Date (whether or not such default is cured within the time period,
if any, provided in such Article), this Lease shall IPSO FACTO be canceled and
terminated. In such event, (i) neither Tenant nor any person claiming through or
under Tenant, or by virtue of any statute or order of any Court, shall be
entitled to possession of the Premises; and (ii) in addition to such other
rights and remedies provided in this Article 22, (A) Landlord may retain as
damages any Rent, Security Deposit (if any) or monies received from Tenant or
others on account of Tenant and (B) the Concession Advance shall be immediately
due and payable. The foregoing is a material
consideration to Landlord for the execution of this Lease.
22.2 All covenants and agreements to be performed by Tenant under this
Lease shall be performed by Tenant at Tenant's sole cost and expense and without
any offset to or abatement of Rent or Expenses.
23. DEFAULTS BY LANDLORD
23.1 Landlord shall not be deemed to be in default in the performance
of any obligation under this Lease unless and until it has failed to perform
such obligation within (30) days after receipt of written notice by Tenant to
Landlord specifying such failure; provided, however, that if the nature of
Landlord's default is such that more than thirty (30) days are required for its
cure, then Landlord shall not be deemed to be in default if it commences such
cure within the thirty (30)-day period and thereafter diligently prosecutes such
cure to completion. Notwithstanding the foregoing, Landlord's failure to
provide Tenant with water, electricity, heating, ventilating and air
conditioning and elevator service ("essential services") within ten (10) days
after the receipt of the written notice from tenant specifying such failure
shall be deemed a default of this lease so long as failure was caused by the
negligence or willful misconduct of Landlord and in that event, Tenant shall
have the right to obtain such services from a third party. Tenant agrees to
give any Mortgagee a copy, by certified mail, of any notice of default served
upon Landlord, provided that prior to such notice Tenant has been notified in
writing (by way of Notice of Assignment of Rents and Leases, or otherwise) of
the address of such Mortgagee. Tenant further agrees that if Landlord shall
have failed to cure such default within the time provided for in this Lease,
then any such Mortgagee shall have an additional forty-five (45) days within
which to cure such default on the part of the Landlord or if such default cannot
be cured within that time, then such additional time as may be necessary if
within that forty-five (45) days the Mortgagee has commenced and is pursuing the
remedies necessary to cure such default (including but not limited to
commencement of foreclosure proceedings, if necessary, to effect such cure), in
which event this Lease shall not be terminated while such remedies are being so
pursued. If Tenant recovers any judgment against Landlord for a default by
Landlord of this Lease, the judgment shall be satisfied only out of the interest
of Landlord in the Project and neither Landlord nor any of its partners,
shareholders, officers, directors, employees or agents shall be personally
liable for any such default or for any deficiency.
24. COSTS OF SUIT
24.1 If either party brings action for relief against the other,
declaratory or otherwise, arising out of this Lease, including any suit by
Landlord for the recovery of Rent or possession of the Premises, the losing
party shall pay the successful party its costs incurred in connection with and
in preparation for said action, including its reasonable attorneys' fees (which
costs 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, it being agreed that to be
the successful party a party need not necessarily have recovered a judgment, but
shall be the party which, in light of all the facts and circumstances of the
case, shall be deemed to be without fault or to have a lesser degree of fault
than the other party). If Landlord, without fault on Landlord's part, is made a
party to any action instituted by Tenant against a third party or by a 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 any such other person, or otherwise
arising out of or resulting from any act or omission of Tenant or of any such
other person, Tenant shall at its cost and at Landlord's option defend Landlord
therefrom and further, except to the extent Landlord is found separately liable
for its own negligence or wrongful acts, indemnify and hold Landlord harmless
from any judgment rendered in connection therewith and all costs and expenses
(including reasonable attorneys' fees) incurred by Landlord in connection with
such action.
25. SURRENDER OF PREMISES; HOLDING OVER
25.1 Surrender. On expiration or termination of this Lease, Tenant
shall surrender to Landlord the Premises, and all Tenant's improvements thereto
and alterations thereof, broom clean and in good condition (except for ordinary
wear and tear, destruction to the Premises covered by Article 18 of this Lease,
and for alterations that Tenant has the right to remove or is obligated to
remove, so long as Tenant repairs any damage to the Premises under the
provisions of this Article 25 or Article 15), and shall remove all of its
personal property including any signs, notices and displays. Tenant shall
perform all restoration made necessary by the removal of any such improvements
or alterations or personal property, prior to the expiration of the Lease term.
If any such removal would damage the Building structure, Tenant shall give
Landlord prior written notice thereof and Landlord may elect to make such
removal at Tenant's expense or otherwise to require Tenant to post security for
such restoration. Landlord may retain or dispose of in any manner any such
improvements or alterations or personal property that Tenant does not remove
from the Premises on expiration or termination of the term as allowed or
required by this Lease and title to any such improvements or alterations or
personal property that Landlord so elects to retain or dispose of shall vest in
Landlord. Tenant waives all claims against Landlord for any damage or loss to
Tenant arising out of Landlord's retention or disposition of any such
improvements, alterations or personal property and shall be liable to Landlord
for Landlord's costs of storing, removing and disposing of any such
improvements, alterations or personal property which Tenant fails to remove from
the Premises. Tenant shall indemnify, defend and hold Landlord harmless from
all damages, loss, cost and expense (including reasonable attorneys' fees)
arising out of or in connection with Tenant's failure to surrender the Premises
in accordance with this Section 25.1.
25.2 Holding Over. If Tenant holds over after the term hereof, such
tenancy shall be at sufferance only, and not a renewal hereof or an extension of
any further term, and in such case Rent shall be payable at a rental in the
amount of one hundred fifty percent (150%) of the Rent in effect as of the last
month of the term hereof and at the time specified in this Lease, and such
tenancy shall be subject to every other term, covenant and agreement contained
herein other than any provisions for rent concessions, Landlord's Work, or
optional rights of Tenant requiring Tenant to exercise same by written notice
(such as options to extend the term of this Lease). The foregoing shall not,
however, be construed as consent by Landlord to any holding over by Tenant and
Landlord reserves the right to require Tenant to surrender possession of the
Premises upon expiration or termination of this Lease.
26. SURRENDER OF LEASE
26.1 The voluntary of other surrender of this Lease by Tenant, or a
mutual cancellation thereof, shall not work as a merger. Such surrender or
cancellation shall, at the option of Landlord, terminate all or any existing
subleases or subtenancies, or may, at the option of Landlord, operate as an
assignment to it of any or all of such subleases or subtenancies. The delivery
of keys to the Premises to Landlord or its agent shall not, of itself,
constitute a surrender and termination of this Lease.
27. TRANSFER OF LANDLORD'S INTEREST
27.1 If Landlord sells or transfers its interest in the Premises (other
than a transfer for security purposes) Landlord shall be released from all
obligations and liabilities accruing thereafter under this Lease, if Landlord's
successor has assumed in writing Landlord's obligations under this Lease. Any
Security Deposit, prepaid Rent or other funds of Tenant in the hands of Landlord
at the time of transfer shall be delivered to such successor and Tenant agrees
to attorn to the purchaser or assignee, provided all Landlord's obligations
hereunder are assumed in writing by such successor. Notwithstanding the
foregoing, Landlord's successor shall not be liable to Tenant for any such funds
of Tenant which Landlord does not deliver to the successor.
28. ASSIGNMENT AND SUBLETTING
28.1 Landlord's Consent Required. Tenant shall not sell, assign,
mortgage, pledge, hypothecate or encumber this Lease (any such act being
referred to herein as an "assignment"), and shall not sublet the Premises or any
part thereof, without the prior written consent of Landlord in each instance,
which consent shall not be unreasonably withheld, and any attempt to do so
without such consent shall be voidable by Landlord and, at Landlord's election,
shall constitute a material default under this Lease.
28.1.1 It is anticipated that Tenant may have and maintain one or
more space sharing arrangements in the Premises with affiliated companies,
whereby Tenant and such affiliated companies will share use of the Premises and
certain common facilities, amenities and services, and in connection with such
arrangements, Tenant will not construct demising walls segregating portions of
the Premises. The parties hereby agree that such space sharing arrangements
shall not constitute a transfer, assignment or sublease for purposes of this
Article 28 and shall not require Landlord's consent so long as the originally
named Tenant herein occupies at lease ninety percent (90%) of the rentable area
of the Premises.
28.2 Tenant's Application. If Tenant desires at any time to assign
this Lease (which assignment shall in no event be for less than its entire
interest in this Lease) or to sublet more than ten percent (10%) of the
Premises, Tenant shall submit to Landlord at least forty-five (45) days prior to
the proposed effective date of the transaction ("Proposed Effective Date"), in
writing, a notice of intent to assign or sublease, setting forth: (i) the
Proposed Effective Date, which shall be no less than forty-five (45) nor more
than ninety (90) days after the sending of such notice; (ii) the name of the
proposed subtenant or assignee; (iii) the nature of the proposed subtenant's or
assignee's business to be carried on in the Premises; and (iv) a description of
the terms and provisions of the proposed sublease or assignment. Such notice
shall be accompanied by (i) such financial information as Landlord may request
concerning the proposed subtenant or assignee, including recent financial
statements and bank references; (ii) evidence satisfactory to Landlord that the
proposed subtenant or assignee will immediately occupy and thereafter use the
affected portion of the Premises for the entire term of the sublease or
assignment agreement; (iii) a conformed or photostatic copy of the proposed
sublease or assignment agreement; and (iv) any fee required under Section 28.9.
During the time that Landlord has in which to exercise the options available to
Landlord upon the giving of such notice, as hereinafter described, Tenant shall
not sublet all or any part of the Premises nor assign all or any part of this
Lease.
28.3 Landlord's Option to Recapture Premises. If Tenant proposes to
sublease all or part of the Premises for the balance of the Lease term, Landlord
may, at its option upon written notice to Tenant given within thirty (30) days
after its receipt of the above-described notice from Tenant, elect to recapture
such portion of the Premises as Tenant proposes to sublease and upon such
election by Landlord, this Lease shall terminate as to the portion of the
Premises recaptured. In the event a portion only of the Premises is recaptured,
the Rental payable under this Lease, the Security Deposit, and Tenant's Share
shall be proportionately reduced based on the rentable square footage retained
by Tenant and the rentable square footage leased by Tenant hereunder immediately
prior to such recapture and termination, and Landlord and Tenant shall thereupon
execute an amendment of this Lease in accordance therewith. If Landlord
recaptures only a portion of the Premises, it shall construct and erect at its
sole cost such partitions as may be required to separate the space retained by
Tenant
from the space recaptured by Landlord; provided, however, that said partitions
need only be finished in Building Standard condition. Landlord may, at its
option, lease the recaptured portion of the Premises to the proposed subtenant
without liability to Tenant. If Landlord does not elect to recapture pursuant to
this Section 28.3, Tenant may thereafter enter into a valid sublease with
respect to the Premises, provided Landlord, pursuant to this Article 28,
consents thereto, and provided further that (i) the sublease is executed within
ninety (90) days after notification to Landlord of such proposal, and (ii) the
rental therefor is not less than that stated in such notification. Any
termination as provided in this Section 28.3 shall be subject to the written
consent of any Mortgagee of Landlord. The effective date of any such termination
shall be the Proposed Effective Date so long as Tenant has complied with the
provisions of Section 28.2 above, and otherwise shall be as specified in
Landlord's notice of termination.
28.4 Approval/Disapproval Standards. In the event that Tenant complies
with the provisions of Section 28.2, and Landlord does not exercise an option
provided to Landlord under Section 28.3, Landlord's consent to a proposed
assignment or sublease shall not be unreasonably withheld. In determining
whether to grant or withhold consent to a proposed assignment or sublease,
Landlord may consider any reasonable factor. Without limiting what may be
construed as a reasonable factor, it is hereby agreed that any one of the
following factors will be reasonable grounds for disapproval of a proposed
assignment or sublease:
28.4.1 Tenant has not complied with the requirements set forth in
Section 28.2 above;
28.4.2 The proposed assignee or subtenant does not, in Landlord's
reasonable judgment, have a sufficient financial worth, considering the
responsibility involved;
28.4.3 The proposed assignee or subtenant does not, in Landlord's
reasonable judgment, have a good reputation as a tenant of property;
28.4.4 Landlord has had prior negative leasing experience with
the proposed assignee or subtenant;
28.4.5 The use of the Premises by the proposed assignee or
subtenant will not be identical to the use permitted by this Lease;
28.4.6 In Landlord's reasonable judgment, the proposed assignee
or subtenant is engaged in a business, and the Premises, or the relevant part
thereof, will be used in a manner, that is not in keeping with the then current
standards of the Building, or that will violate any restrictive or exclusive
covenant as to use contained in any other lease of space in the Building or the
Project;
28.4.7 The use of the Premises by the proposed assignee or
subtenant will violate any applicable law, ordinance or regulation;
28.4.8 The proposed assignment or sublease fails to include all of
the terms and provisions required to be included therein pursuant to this
Article 28; or
28.4.9 Tenant is then in default of any obligation of Tenant under
this Lease, or Tenant has defaulted under this Lease on three (3) or more
occasions during the twelve (12) months preceding the date that Tenant shall
request consent.
28.5 Approval/Disapproval Procedure. Landlord shall approve or
disapprove the proposed assignment or sublease by written notice to Tenant. If
Landlord shall exercise any option to recapture the Premises as herein provided,
or denies a request for consent to a proposed sublease or assignment, Landlord
shall not be liable to the proposed assignee or subtenant, or to any broker or
other person claiming a commission or similar compensation in connection with
the proposed assignment or sublease. If Landlord approves the proposed
assignment or sublease, Tenant shall, prior to the Proposed Effective Date,
submit to Landlord all executed originals of the assignment or sublease
agreement and, in the event of a sublease, Landlord's customary consent to
subletting form executed by Tenant and sublessee for execution by Landlord.
Provided such assignment or sublease agreement is in accordance with the terms
approved by Landlord, Landlord shall execute each original as described above
and retain two originals for its file and return the others to Tenant. No
purported assignment or sublease shall be deemed effective as against Landlord
and no proposed assignee or subtenant shall take occupancy unless such document
is delivered to Landlord in accordance with the foregoing.
28.6 Required Provisions. Any and all assignment or sublease
agreements shall (i) contain such terms as are described in Tenant's notice
under Section 28.2 above or as otherwise agreed by Landlord; (ii) prohibit
further assignments or subleases; (iii) impose the same obligations and
conditions on the assignee or sublessee as are imposed on Tenant by this Lease
except as to Rent and term or as otherwise agreed by Landlord; (iv) be expressly
subject and subordinate to each and every provision of this Lease; (v) have a
term that expires on or before the expiration of the term of this Lease; (vi)
provide that if Landlord succeeds to sublessor's position, Landlord shall not be
liable to sublessee for advance rental payments, deposits or other payments
which have not been actually delivered to Landlord by the sublessor; and (vii)
provide that Tenant and/or the assignee or sublessee shall pay Landlord the
amount of any additional costs or expenses incurred by Landlord for repairs,
maintenance or otherwise as a result of any change in the nature of occupancy
caused by the assignment or sublease. Any and all sublease agreements shall
also provide that in the event of termination, re-entry, or dispossession by
Landlord under this Lease, Landlord may, at its option, take over all of the
right, title and interest of Tenant as sublessor under such sublease, and such
subtenant shall, at Landlord's option, attorn to
Landlord pursuant to the then executory provisions of the sublease, except that
Landlord shall not: (i) be liable for any previous act or omission of Tenant
under the sublease; (ii) be subject to any offset not expressly provided in the
sublease, that theretofore accrued to the subtenant against Tenant; or (iii) be
bound by any previous modification of such sublease or by any previous
prepayment of more than one (1) month's fixed rent or any additional rent then
due.
28.7 Payment of Additional Rent Upon Assignment or Sublease. If
Landlord shall give its consent to any assignment of this Lease or to any
sublease of the Premises, Tenant shall, in consideration therefor, pay to
Landlord as additional Rent:
28.7.1 In the case of an assignment, an amount equal to fifty
percent (50%) of all sums and other consideration paid to Tenant by the assignee
for, or by reason of, such assignment (including, without limiting the
generality of the foregoing, all sums paid for the sale of Tenant's leasehold
improvements); and
28.7.2 In the case of a sublease, fifty percent (50%) any rents,
additional charges, or other consideration payable under the sublease by the
subtenant to Tenant that are in excess of the Rent and Tenant's Share of
Expenses accruing during the term of the sublease in respect of the subleased
space (at the rate per square foot payable by Tenant hereunder) pursuant to the
terms hereof (including, without limiting the generality of the foregoing, all
sums paid for the sale or rental of Tenant's leasehold improvements).
28.8 The sums payable under Section 28.7.1 above shall be paid to
Landlord upon the effective date of the assignment. The sums payable under
Section 28.7.2 above shall be paid to Landlord as and when payable by the
sublessee to Tenant. Within fifteen (15) days after written request therefor by
Landlord, Tenant shall at any time and from time to time furnish evidence to
Landlord of the amount of all such sums or other consideration received or
expected to be received.
28.9 Fees for Review. Simultaneously with the giving of notice
described in Section 28.2 above, Tenant shall pay to Landlord or Landlord's
designee a non-refundable fee in the amount of Three Hundred Dollars ($300.00)
as reimbursement for expenses incurred by Landlord in connection with reviewing
such transaction. In addition to such reimbursement, if Landlord retains the
services of an attorney to review the transaction, Tenant shall pay to Landlord
the reasonable attorneys' fees (not to exceed $500 per transaction) incurred by
Landlord in connection therewith. Tenant shall pay such attorneys' fees to
Landlord within fifteen (15) days after written request therefor.
28.10 No Release of Tenant. No consent by Landlord to any assignment or
subletting by Tenant shall relieve Tenant of any obligation to be performed by
Tenant under this Lease, whether occurring before or after such consent,
assignment or subletting, including Tenant's obligation to obtain Landlord's
express prior
written consent to any other assignment or subletting. In no event shall any
permitted subtenant assign its sublease, further sublet all or any portion of
its sublet space, or otherwise suffer or permit the sublet space, or any part
thereof, to be used or occupied by others, except upon compliance with, and
subject to the provisions of this Article 28. The acceptance by Landlord of
payment from any person other than Tenant shall not be deemed to be a waiver by
Landlord of any provision of this Lease or to be a consent to any subsequent
assignment or sublease, or to be a release of Tenant from any obligation under
this Lease.
28.11 Assumption of Obligations. Each assignee of Tenant shall assume
the obligations of Tenant under this Lease and shall be and remain liable
jointly and severally with Tenant for the payment of the Rent and the
performance of all the terms, covenants, conditions and agreements herein
contained on Tenant's part to be performed for the term of this Lease. No
assignment shall be binding on Landlord unless the assignee or Tenant delivers
to Landlord a counterpart of the instrument of assignment in recordable form
which contains a covenant of assumption by the assignee satisfactory in
substance and form to Landlord, and consistent with the requirements of this
Article 28. The failure or refusal of the assignee to execute such instrument
of assumption shall not release or discharge the assignee from its liability to
Landlord hereunder. Landlord shall have no obligation whatsoever to perform any
duty to or respond to any request from any sublessee, it being the obligation of
Tenant to administer the terms of its subleases.
28.12 Corporate or Partnership Transfers. If Tenant is a privately held
corporation, or is an unincorporated association or partnership, the cumulative
or aggregate transfer, assignment or hypothecation of fifty percent (50%) or
more of the total stock or interest in such corporation, association or
partnership shall be deemed an assignment or sublease within the meaning and
provisions of this Article. This Article shall, however, not apply to
assignments or subleases to a corporation (i) into or with which Tenant is
merged or consolidated; (ii) to which substantially all of Tenant's assets are
transferred; or (iii) that controls, is controlled by, or is under common
control with Tenant, provided that, in any of such events:
28.12.1 The successor of Tenant has a net worth, computed in
accordance with generally accepted accounting principles, at least equal to the
greater of (a) the net worth of Tenant immediately prior to such merger,
consolidation or transfer, or (b) the net worth of Tenant herein named on the
date of this Lease;
28.12.2 Proof satisfactory to Landlord of such net worth
shall have been delivered to Landlord at least ten (10) days prior to the
effective date of such transaction;
28.12.3 Any such assignment or sublease shall be subject to
all of the terms and provisions of this Lease, and such assignee or sublessee
shall assume, in a written document reasonably satisfactory
to Landlord and delivered to Landlord promptly upon the assignment or sublease,
all the obligations of Tenant under this Lease;
28.12.4 Tenant shall remain fully liable for all obligations
to be performed by Tenant under this Lease; and
28.12.5 Tenant shall reimburse Landlord, promptly upon
demand, for Landlord's reasonable attorneys' fees incurred in conjunction with
the processing and documentation of any such transaction.
28.13 Involuntary Assignment. No interest of Tenant in this Lease shall
be assignable by operation of law (including without limitation, the transfer of
this Lease by testacy or intestacy, or in any bankruptcy or insolvency
proceeding). Each of the following acts shall be considered an involuntary
assignment: (i) If Tenant is or becomes bankrupt or insolvent, makes an
assignment for the benefit of creditors, or institutes a proceeding under any
bankruptcy law in which Tenant is the bankrupt; or, if Tenant is a partnership
or consists of more than one (1) person or entity, if any partner of the
partnership or other such person or entity is or becomes bankrupt or insolvent,
or makes an assignment for the benefit of creditors; (ii) If a writ of
attachment or execution is levied on this Lease; (iii) If, in any proceeding or
action to which Tenant is a party, a receiver is appointed with authority to
take possession of the Premises; or (iv) there is any assumption, assignment,
sublease or other transfer under or pursuant to the Bankruptcy Code, 11 U.S.C.
101 ET SEQ (hereinafter referred to as the "Bankruptcy Code"). An involuntary
assignment shall constitute a default by Tenant and Landlord shall have the
right to elect to terminate this Lease, in which case this Lease shall not be
treated as an asset of Tenant. If Landlord shall elect not to exercise its
right hereunder to terminate this Lease in the event of an involuntary
assignment, then, in addition to any other rights or remedies of Landlord under
this Lease or provided by law, the provisions of Sections 28.3, 28.6, 28.7,
28.9, 28.10, and 28.14 shall apply to any such involuntary assignment. Such
sums, if any, payable pursuant to the referenced Sections shall be and remain
the exclusive property of Landlord and shall not constitute property of Tenant
or of the estate of Tenant within the meaning of the Bankruptcy Code. Such sums
which are not paid or delivered to Landlord shall be held in trust for the
benefit of Landlord, and shall be promptly paid or turned over to Landlord upon
demand. Any person or entity to which this Lease is assigned pursuant to the
provisions of said Code shall be deemed without further act or deed to have
assumed all of the obligations of Tenant arising under this Lease on and after
the date of such assignment. Any such assignee shall upon demand execute and
deliver such instruments and documents reasonably requested by Landlord
confirming such assumption.
28.14 Assignment of Sublease Rents. Tenant immediately and irrevocably
assigns to Landlord, as security for Tenant's obligations under this Lease, all
rent from any subletting of all or any part of the Premises, and Landlord, as
assignee and as attorney-in-fact for
Tenant for purposes hereof, or a receiver for Tenant appointed on Landlord's
application, may collect such rents and apply same toward Tenant's obligations
under this Lease; except that, until the occurrence of an act of default by
Tenant, Tenant shall have the right and license to collect such rents.
29. ATTORNMENT
29.1 If any proceeding is brought for default under any ground or
underlying lease to which this Lease is subject, or in the event of foreclosure
or the exercise of the power of sale under any mortgage or deed of trust made by
Landlord covering the Premises, Tenant shall attorn to the successor under any
such foreclosure or sale and shall recognize that successor as Landlord under
this Lease, provided such successor expressly agrees in writing to be bound to
all future obligations by the terms of this Lease and, if so requested, Tenant
shall enter into a new lease with that successor on the same terms and
conditions as are contained in this Lease (for the unexpired term of this Lease
then remaining).
30. SUBORDINATION
30.1 Without the necessity of any additional document being executed by
Tenant for the purpose of effecting a subordination, this Lease shall be subject
and subordinate at all times to: (i) all ground or underlying leases which may
now exist or hereafter be executed affecting the Premises, and (ii) the lien of
any first mortgage or first deed of trust which may now exist or hereafter be
executed in any amount for which the Premises, such ground or underlying leases,
or Landlord's interest or estate in any of them, is specified as security.
Notwithstanding the foregoing, Landlord shall have the right to subordinate or
cause to be subordinated any such ground or underlying leases or any such liens
to this Lease. If any ground or underlying lease terminates for any reason,
Tenant shall, notwithstanding any subordination, attorn to and become tenant of
the successor in interest to Landlord at the option of such successor in
interest. Tenant covenants and agrees to execute and deliver, upon demand by
Landlord and in the form requested by Landlord, any documents evidencing the
priority or subordination of this Lease with respect to any such ground or
underlying leases or the lien of any such first mortgage, or first deed of
trust, and specifically to execute, acknowledge and deliver to Landlord from
time to time within ten (10) days after written request to do so a subordination
of lease, or a subordination of deed of trust, in substantially the form set
forth in Exhibit D or Exhibit D-1, respectively, attached hereto, or such other
form as may be customarily required by any Mortgagee of Landlord, and failure of
Tenant to do so shall be a material default hereunder; provided that such
documents do not increase Tenant's obligations hereunder or otherwise adversely
affect Tenant's occupancy of the Premises. Tenant hereby irrevocably appoints
Landlord as its attorney-in-fact to execute and deliver such statement to any
third party in the name and on behalf of Tenant if Tenant fails to comply with
the foregoing.
31. ESTOPPEL CERTIFICATE
31.1 Tenant shall from time to time within ten (10) days after prior
written notice from Landlord execute, acknowledge and deliver to Landlord a
statement in writing in the form set forth in Exhibit E attached hereto, or such
other form as may be customarily required by Landlord's Mortgagee, (i)
certifying that this Lease is unmodified and in full force and effect (or, if
modified, stating the nature of such modification and certifying that this
Lease, as so modified, is in full force and effect) and the date to which the
Rent and other charges are paid in advance, if any; (ii) acknowledging that
there are not, to Tenant's knowledge, any uncured defaults on the part of
Landlord hereunder (or specifying such defaults if they are claimed); and (iii)
containing such other matters as are set forth in such form. Any such statement
may be conclusively relied upon by any prospective purchaser or encumbrancer of
the Premises. Tenant's failure to deliver such statement within such time shall
be conclusive upon Tenant that this Lease is in full force and effect, without
modification except as may be represented by Landlord, that there are no uncured
defaults in Landlord's performance, and that not more than one (1) month's Rent
has been paid in advance. Failure of Tenant to so deliver such statement shall
be a material default hereunder. Tenant hereby irrevocably appoints Landlord as
its attorney-in-fact to execute and deliver such statement to any third party in
the name and on behalf of Tenant if Tenant fails to comply with the foregoing.
32. BUILDING OCCUPANCY PLANNING
32.1 Notwithstanding any contrary provision of this Lease, if Landlord
requires the Premises for use in conjunction with another suite or for other
reasons related to Landlord's occupancy plans for the Building, then upon at
least thirty (30) days' prior written notice to Tenant, Landlord shall have the
right to move Tenant to other space in the Project, and thereupon such other
space shall be deemed to be the Premises covered by this Lease. The expense of
moving Tenant, its property and equipment to the substituted space and of
improving same to the then current condition of the Premises shall be borne by
Landlord. If the substituted space is smaller or larger than the Premises, the
Basic Rent, Security Deposit and Tenant's Share specified in this Lease shall be
adjusted proportionately, and Landlord and Tenant shall execute an amendment to
this Lease in accordance therewith. However, if the substituted space does not
meet with Tenant's approval, Tenant may cancel this Lease upon thirty (30) days'
prior written notice to Landlord, given within ten (10) days after Tenant's
receipt of Landlord's notice referred to above. Notwithstanding the foregoing,
the provision of Section 32.1 shall only apply if, during the term of this
Lease, the square footage of the Premises as set forth in Section 1.2 hereof has
been reduced by Tenant by more than fifty percent (50%.)
33. QUIET ENJOYMENT
33.1 So long as Tenant pays all Rent and other sums due under this
Lease, performs its covenants and obligations under this Lease and recognizes
any successor to Landlord in accordance with the terms of this Lease, Tenant
shall lawfully and quietly have, hold and enjoy the Premises without hindrance
or molestation by Landlord or anyone claiming by, through or under Landlord,
subject, however, to all the provisions of this Lease.
34. WAIVER OF REDEMPTION BY TENANT
34.1 Tenant hereby waives for Tenant and for all those claiming under
Tenant all right now or hereafter existing to redeem by order or judgment of any
court or by any legal process or writ, Tenant's right of occupancy of the
Premises after any termination of this Lease.
35. WAIVER OF LANDLORD, TENANT'S PROPERTY
35.1 Landlord shall, within thirty (30) days after written request from
Tenant, execute and deliver to Tenant any statement in form acceptable to
Landlord as may be required by any supplier, lessor, installment seller or
chattel mortgagee in connection with the installation in the Premises of any
personal property or trade fixtures of Tenant, pursuant to which Landlord shall
agree to waive any rights it may have or may acquire with respect to any such
property, provided in all cases that such supplier, lessor, installment seller
or chattel mortgagee expressly agrees in writing that: (i) It will remove at
its sole cost and expense all such property from the Premises before the
expiration or termination of the Lease and if it fails to do so within ten (10)
days after written request from Landlord it shall be deemed to have waived any
and all rights it may have had to such property; (ii) Prior to making any such
removal it will advise Landlord in writing of the date and time of such removal
and will at the time of such removal, allow a representative of Landlord to be
present; (iii) It will promptly and diligently and at its sole cost and expense
repair any and all damage to the Premises attributable to such removal and shall
restore the Premises to substantially the same condition it was in prior to such
removal; (iv) It will allow Landlord to select the person or persons who will
effect such removal, repair and restoration, and will bear the costs and
expenses thereof; (v) It will, if Landlord chooses not to exercise its rights
under (iv) above, cause a performance and completion bond, satisfactory to
Landlord, to be furnished to Landlord with regard to the work of such removal,
repair and restoration; (vi) It will promptly pay Landlord any costs and
expenses incurred by Landlord in connection with the enforcement of Landlord's
rights hereunder, including attorneys' fees, and will indemnify and hold
Landlord harmless against any and all claims, loss, cost or expense arising out
of or in connection with such removal, rpair and restoration; (vii) It will pay
Landlord interest on any outstanding amounts payable by it to Landlord at the
"Agreed Rate" (as hereinafter defined); (viii) It will not record such statement
without Landlord's prior written consent which Landlord may withhold in its sole
discretion and (ix) It will not assign its rights or delegate its duties under
such statement without Landlord's prior written consent.
36. RULES AND REGULATIONS
36.1 The Rules and Regulations attached hereto as Exhibit F are
expressly made a part hereof. Tenant agrees to comply with such Rules and
Regulations and any reasonable amendments, modifications or additions thereto as
may hereafter be adopted and published by notice to tenants in the Building, and
to cause its agents, contractors and employees to comply therewith, and agrees
that the violation of any of them shall constitute a default by Tenant under
this Lease. If there is a conflict between the Rules and Regulations and any of
the provisions of this Lease, the provisions of this Lease shall prevail.
Landlord shall not be responsible to Tenant for the non-performance by any other
tenant or occupant of the Building or of the Project of any of the Rules and
Regulations.
37. NOTICES
37.1 Any notice, demand or communication required or permitted to be
given hereunder to Landlord by Tenant shall be personally served or deposited in
the United States mails, duly registered or certified with postage fully prepaid
thereon, addressed to Landlord at Landlord's address as set forth in Section 1.9
hereof, or to such other address to which Tenant last forwarded Rent, or to such
other parties as Landlord may from time to time designate. Any notice, demand
or communication required or permitted to be given hereunder to Tenant by
Landlord may be mailed as above stated to Tenant's address as set forth in
Section 1.10 hereof or delivered personally to Tenant at the address of the
Premises. Either party may by written notice similarly given designate a
different address for notice purposes, except that Landlord may in any event use
the Premises as Tenant's address for notice purposes. Notice shall be effective
when mailed or delivered as above specified.
38. WAIVER
38.1 No delay or omission in the exercise of any right or remedy of
Landlord for any default by Tenant shall impair such right or remedy or be
construed as a waiver. The receipt and acceptance by Landlord of delinquent
payments shall not constitute a waiver of any other default, and shall not
constitute a waiver of timely payment of the particular payment involved. No
act or conduct of Landlord, including, without limitation, the acceptance of
keys to the Premises, shall constitute an acceptance of the surrender of the
Premises by Tenant before the expiration of the term. Only an express notice to
such effect from Landlord to Tenant shall constitute acceptance of the surrender
of the Premises sufficient to terminate this Lease. Landlord's consent to or
approval of any act by Tenant requiring Landlord's consent or approval shall not
constitute a consent or approval of any subsequent act by Tenant. Any waiver by
Landlord of
any default must be in writing and shall not be a waiver of any other default
concerning the same or any other provision of this Lease.
39. MISCELLANEOUS
39.1 Execution by Landlord. The submission of this document for
examination and negotiation does not constitute an offer to lease, or a
reservation of, or an option for, the Premises. This document becomes effective
and binding only upon execution by Tenant and by Landlord. No act or omission
of any employee or agent of Landlord or of Landlord's broker shall alter, change
or modify any of the provisions hereof.
39.2 Landlord and Tenant. As used in this Lease, the words "Landlord"
and "Tenant" include the plural as well as the singular. Words used in the
neuter gender include the masculine and feminine and words in the masculine and
feminine gender include the neuter. If there is more than one person or entity
constituting Landlord or Tenant, the obligations imposed hereunder upon Landlord
or Tenant are joint and several. If Tenant consists of a husband and wife, the
obligations of Tenant hereunder extend individually to the sole and separate
property of each of them as well as to their community property. The
obligations contained in this Lease to be performed by Landlord shall be binding
on Landlord's successors and assigns only during their respective periods of
ownership of the Premises.
39.3 Brokers. Tenant shall hold Landlord harmless from all damages
(including reasonable attorneys' fees and costs) resulting from any claims that
may be asserted against Landlord by any broker, finder, or other person with
whom Tenant has or purportedly has dealt, except as set forth in Section 1.11.
39.4 Signs. Tenant shall not place or permit to be placed in or upon
the Premises, where visible from outside the Premises, or outside the Premises
on any part of the Building or Project, any signs, notices, drapes, shutters,
blinds, or displays of any type, without the prior written consent of Landlord.
Landlord reserves the right in its sole discretion to place and locate on the
roof or exterior of the Building, and in any area of the Project not leased to
Tenant, any signs, notices, displays and similar items as Landlord deems
appropriate.
39.5 Name of Building. Tenant shall not use the name of the Building
or the Project for any purpose other than the address of the business to be
conducted by Tenant in the Premises. Tenant shall not use any picture of the
Building or the Project in its advertising, stationery or in any manner so as to
imply that the entire Building is leased by Tenant. Landlord expressly reserves
the right at any time to change the name of the Building or Project without in
any manner being liable to Tenant therefor.
39.6 Parking. During the term of this Lease, Tenant shall only be
entitled to such use of parking spaces in the parking areas located in
the Project as shall be confirmed in writing by the parties, and absent any
written agreement to the contrary, parking for Tenant and its employees, agents,
customers, invitees and licensees shall be on a first-come, first-served basis,
at rates and upon other terms and conditions as may be established from time to
time by Landlord or Landlord's operator of the parking areas. Parking rates may
be hourly, weekly or monthly, or such other rate system as Landlord deems
advisable, and Tenant acknowledges that its employees shall not be entitled to
park in such parking areas located in and about the Building which may from time
to time be designated for visitors of the Building. Landlord may also designate
areas for assigned, reserved or employee parking either within the parking areas
located in and about the Building, or in other areas reasonably close thereto.
Landlord shall have the right to change any such designated parking areas from
time to time. Tenant acknowledges that neither Landlord nor any agent of
Landlord has made any representation or warranty as to the suitability of the
parking areas for the conduct of Tenant's business.
39.7 Guarantee. Any guarantee of this Lease shall be in the form set
forth at Exhibit G. If this Lease shall have been guaranteed, any such
guarantee shall be deemed a material part of the consideration for Landlord's
execution of this Lease. If the guarantor under any such guarantee is or
becomes bankrupt or insolvent, makes an assignment for the benefit of creditors,
or institutes or is the subject of any proceeding under the Bankruptcy Code or
other similar law for the protection of creditors (or, if the guarantor is a
partnership or consists of more than one person or entity, if any partner of the
partnership or such other person or entity is or becomes bankrupt or insolvent,
institutes any such proceeding, or makes an assignment for the benefit of
creditors), then Landlord shall have the option to terminate this Lease upon
thirty (30) days written notice unless Tenant, within such thirty (30)-day
period, provides Landlord with either (i) a substitute or additional guarantor
satisfactory to Landlord and any Mortgagee of Landlord, or (ii) adequate
assurance of the performance of each and every obligation of Tenant hereunder,
satisfactory to Landlord and such Mortgagee; provided, however, that no such
termination of this Lease shall become effective without the prior written
consent of such Mortgagee.
39.8 Approval of Landlord's Mortgagee. Tenant acknowledges that this
Lease is subject to the approval of Landlord's Mortgagee, and Tenant agrees to
make such reasonable modifications to this Lease as may be ordinarily and
customarily requested by Landlord's Mortgagee, so long as such modifications
shall not affect the Rent payable hereunder, increase Tenant's obligations
hereunder, or otherwise adversely affect Tenant in any material way.
39.9 Landlord's Financing. In connection with Landlord's financing of
the Premises or any other part of the Project, if Landlord's Mortgagee requires
Tenant to execute, acknowledge and deliver to Landlord or Landlord's Mortgagee
certain documents as may be ordinarily and customarily required by such lender
in connection with financing, including without limitation those documents as
may be
required under Articles 30 and 31 of this Lease, Tenant shall be liable for any
and all loss, cost, damage, or expense (including without limitation reasonable
attorneys' fees) which Landlord may sustain or incur as a result of or in
connection with Tenant's unreasonable failure or delay in executing,
acknowledging and delivering such documents, or Tenant's breach of any other
covenant or agreement embodied in this Lease that results in the delay,
impairment or cancellation of Landlord's financing.
39.10 Nonrecordability of Lease. Tenant agrees that in no event shall
this Lease or a memorandum hereof be recorded without Landlord's express prior
written consent.
39.11 Matters of Record. This Lease and Tenant's rights hereunder are
subject and subordinate in all respects to matters affecting Landlord's title
recorded in the official records of the county recorder's office for the county
in which the Project is located prior or subsequent to the date of execution of
this Lease, and is expressly subject and subordinate to the following:
Declaration of Covenants, Conditions, and Restrictions dated March 11, 1981 and
recorded on March 18, 1981 as Document No. 81-278401 in the Official Records of
Los Angeles County, California, as amended. Tenant agrees that as to its
leasehold estate it, and all persons in possession or holding under it, will
conform with and will not violate any such covenants, conditions and
restrictions, or other matters of record.
39.12 Severability. If any provision of this Lease shall, to any
extent, be determined by a court of competent jurisdiction to be invalid or
unenforceable, the remainder of this Lease shall not be affected thereby, and
every other term and provision of this Lease shall be valid and enforceable to
the fullest extent permitted by law.
39.13 Construction. All provisions hereof, whether covenants or
conditions, shall be deemed to be both covenants and conditions. The
definitions contained in this Lease shall be used to interpret this Lease.
39.14 Interest. Except as expressly provided otherwise in this Lease,
any amount due to Landlord which is not paid when due shall bear interest from
the date due at the prime commercial rate of interest charged from time to time
by Citibank N.A. plus two percent (2%) per annum, but not to exceed the maximum
rate of interest allowable under law (the "Agreed Rate"). Payment of such
interest shall not excuse or cure any default by Tenant under this Lease.
39.15 Binding Effect; Choice of Law. Except as expressly provided
otherwise in this Lease, all of the provisions hereof shall be binding upon and
inure to the benefit of the parties hereto and their respective heirs, legal
representatives, successors and assigns. This Lease shall be governed by the
laws of the State of California.
39.16 Waiver of Trial by Jury. Landlord and Tenant each hereby waive
trial by jury in any action, proceeding or counterclaim brought by either
against the other on any matter whatsoever arising out of or in any way
connected with this Lease or Tenant's use or occupancy of the Premises,
including any claim of injury or damage, and any emergency and other statutory
remedy with respect thereto. Landlord and Tenant also agree that the venue of
any such action, proceeding or counterclaim shall be in the City and County of
Los Angeles, State of California.
39.17 Time; Rights Cumulative. Time is of the essence of this Lease and
each and every provision hereof, except as may be expressly provided otherwise.
All rights and remedies of the parties shall be cumulative and non-exclusive of
any other remedy at law or in equity.
39.18 Inability to Perform. This Lease and the obligations of Tenant
hereunder shall not be affected or impaired because Landlord is unable to
fulfill any of its obligations hereunder or is delayed in doing so, if such
inability or delay is caused by reason of force majeure, strike, labor troubles,
acts of God, acts of government, unavailability of materials or labor, or any
other cause beyond the control of Landlord.
39.19 Corporate Authority. If Tenant is a corporation, each individual
executing this Lease on behalf of Tenant represents and warrants that he or she
is duly authorized to execute and deliver this Lease on behalf of Tenant, and
that Tenant is qualified to do business in the State of California, and shall
deliver appropriate certification to that effect if requested.
39.20 Partnership Authority. If Tenant is a partnership, joint venture,
or other unincorporated association, each individual executing this Lease on
behalf of Tenant represents that this Lease is binding on Tenant. Furthermore,
Tenant agrees that the execution of any written consent hereunder, or of any
written modification or termination of this Lease, by any general partner of
Tenant or any other authorized agent of Tenant, shall be binding on Tenant.
39.21 Submittal of Financial Statement. At any time and from time to
time during the term of this Lease, within fifteen (15) days after request
therefor by Landlord, Tenant shall supply to Landlord and/or any Mortgagee a
current financial statement or such other financial information as may be
required by any such party.
39.22 Riders. Clauses, plats, addenda, and riders, if any that are
signed by Landlord and Tenant and affixed to this Lease, are a part hereof.
40. CONCESSIONS (INTENTIONALLY DELETED)
41. SECURITY INTEREST (INTENTIONALLY DELETED)
42. HAZARDOUS MATERIALS
42.1 Tenant shall not (either with or without negligence) cause permit
the escape, disposal or release of any biologically or chemically active or
other hazardous substances, or materials. Tenant shall not allow the storage or
use of such substances or materials in any manner not sanctioned by law or by
the highest standards prevailing in the industry for the storage and use of such
substances or materials, not allow to be brought into the Project any such
materials or substances except to use in the ordinary course of Tenant's
business, and then only after written notice is given to Landlord of the
identity of such substances or materials. Without limitation, hazardous
substances and materials shall include those described in the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended, 42
U.S.C. Section 6901 ET SEQ., any applicable state or local laws and the
regulations adopted under these acts. If any lender or governmental agency
shall ever require testing to ascertain whether or not there has been any
release of hazardous materials, then the reasonable costs thereof shall be
reimbursed by Tenant to Landlord upon demand as additional charges if such
requirement applies to the Premises. In addition, Tenant shall execute
affidavits, representations and the like from time to time at Landlord's request
concerning Tenant's best knowledge and belief regarding the presence of
hazardous substances or materials on the Premises. In all events, Tenant shall
indemnify Landlord in the manner else where provided in this Lease from any
release of hazardous materials on the Premises occurring while Tenant is in
possession, of elsewhere if caused by Tenant or persons acting under Tenant.
The within covenants shall survive the expiration or earlier termination of the
Lease term.
43. RIGHT OF FIRST REFUSAL
43.1 Right of First Refusal. Landlord hereby grants to the originally
named Tenant herein a right of first refusal with respect to space situated on
the second and third floors of the Building (the "First Refusal Space"). Not
withstanding the foregoing, such right of Tenant shall be subject and
subordinate to all existing rights of tenants in the Building, including any
rights held by Syseca, Inc. and Fast Forward Marketing, Inc. (collectively, the
"Superior Right Holders") with respect to such First Refusal Space. Tenant's
right of first refusal shall be on the terms and conditions set forth in this
Section 43.
43.1.1 Procedure for Refusal. Landlord shall notify Tenant (the
"First Refusal Notice") prior to entering into any lease of the First Refusal
Space to a third party (not including any Superior Right Holder). Pursuant to
such First Refusal Notice, Landlord shall offer to lease to Tenant the then
available First Refusal Space. The First Refusal Notice shall describe the
space so offered to Tenant and shall set forth the "First Refusal Rent," as that
term is defined in Section 43.1.3 below, and the other economic terms upon which
Landlord is willing to lease such space to Tenant.
43.1.2 Procedure for Acceptance. If Tenant wishes to exercise
Tenant's right of first refusal with respect to the space described in the First
Refusal Notice, then within five (5) business days of delivery of the First
Refusal Notice to Tenant, Tenant shall deliver notice to Landlord of Tenant's
intention to exercise its right of first refusal with respect to the First
Refusal Space. If Tenant does not so notify Landlord within the five (5)
business day period, then Landlord shall be free to lease the space described in
the First Refusal Notice to anyone to whom Landlord desires on the terms set
forth in the First Refusal Notice. Notwithstanding anything to the contrary
contained herein, Tenant must elect to exercise its right of first refusal, if
at all, with respect to ALL of the First Refusal Space, and Tenant may not elect
to lease only a portion thereof.
43.1.3 First Refusal Space Rent. The Rent payable by Tenant for
the First Offer Space (the "First Refusal Rent") shall be the rent, including
all material economic concessions, at which Landlord has agreed or would agree
to lease the First Refusal Space to a third party.
43.1.4 Construction in the First Refusal Space. Except as
otherwise set forth in the First Refusal Notice, including with respect to any
tenant improvement allowance which makes up a part of the First Refusal Rent,
Tenant shall take the First Refusal Space in its "as is" condition, and the
construction of improvements in the First Refusal Space to a third party.
43.1.5 Amendment to Lease. If Tenant timely exercises Tenant's
right to lese the First Refusal Space as set forth herein, Landlord and Tenant
shall within fifteen (15) days thereafter execute an amendment to this Lease
adding the First Refusal Space to the Premises upon the terms and conditions as
set forth in the First Refusal Notice and this Section 43.1.5. Tenant shall
commence payment of Tent for the First Refusal Space, and the term of the First
Refusal Space shall commence upon the date of delivery of the First Refusal
space to Tenant (the "First Refusal Commencement Date") and terminate on the
date set forth in the First Refusal Notice.
43.2 Termination of Right of First Refusal. The rights contained in
this Section 43 shall be personal to the originally named Tenant herein, and may
only be exercised by Tenant (and not any assignee, sublessee or other transferee
of Tenant's interest in this Lease) if Tenant occupies the enter Premises. The
right of first refusal granted herein shall terminate upon the failure by Tenant
to exercise its right of first refusal with respect to the First Refusal Space
as offered by Landlord. Tenant shall not have the right to lease First Refusal
Space, as provided in this Section 43, if, as of the date of the attempted
exercise of any right of first refusal by Tenant, or as of the scheduled date of
delivery of such First Refusal Space to Tenant, Tenant is in default under this
Lease after notice and expiration of any applicable cure period or Tenant has
previously been in default under this Lease after and expiration of any
applicable cure period more than once.
44. MONUMENT SIGNAGE
44.1 Signage Right. Landlord hereby grants to the originally named
Tenant herein the right to install a monument sign (equal in size to the
existing monument sign on the northwest corner of the Building) in the common
area near the Building subject to Tenant's (1) obtaining all requisite approvals
from the City of Los Angeles, and (2) compliance with the sign criteria for the
Project, install a monument sign in a location to be approved by Landlord.
Tenant shall bear all costs associated with such signage, including but not
limited to the cost of design, fabrication, installation, maintenance and
insurance. Upon any vacation of the premises by Tenant, Tenant shall remove
such signage at Tenant's expense and shall repair damage to the Building or the
Project caused by such removal. Tenant shall not install such signage until
Landlord's written approval as to the size, material, location, design and color
thereof, and the means of installation of such sign is first had and obtained.
44.2 Termination of Signage Right. The right contained in this Section
44 shall be personal to the originally named Tenant herein, and may only be
exercised by Tenant (and not any assignee, sublessee or other transferee of
Tenant's interest in this Lease) if Tenant occupies the entire Premises.
45. SATELLITE DISH
45.1 Landlord hereby agrees that Tenant may, subject to (1) obtaining
all requisite approvals from the City of Los Angeles and (2) Landlord's approval
as to the size and location and method of installation, install on the roof of
the Building a satellite dish [not to exceed 2 feet (2') in diameter] or other
similar equipment reasonable required by Tenant in connection with Tenant's
business operations. Landlord shall, at Tenant's sole cost and expense,
supervise the installation, maintenance and removal of such equipment and Tenant
shall pay the sum of One Hundred twenty-five Dollars ($125.00) per month for
each month the equipment is installed on the Building rooftop. Upon the
expiration or earlier termination of this Lease, Tenant shall cause the
equipment and all cabling within the Building to be removed and any damage to
the Building or its roof shall be promptly repaired by Tenant at Tenant's sole
cost and expense.
46. INCORPORATION OF PRIOR AGREEMENTS; AMENDMENTS
46.1 This Lease contains all of the agreements of the parties hereto
with respect to any matter covered or mentioned in this Lease, and no prior
agreement, negotiations, brochures, arrangements, or understanding pertaining to
any such matter shall be effective for any purpose unless expressed herein. No
provisions of this Lease may be amended or added to except by an agreement in
writing signed by the parties hereto or their respective successors in interest.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of
the date and year first above written.
LANDLORD:
TIAA REALTY, INC., a Delaware corporation
By: TEACHERS INSURANCE AND ANNUITY ASSOCIATION, a New York
corporation, its authorized representative
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Assistant Secretary
--------------------------------------------------------
Date: May 5, 1999
------------------------------------------------------
TENANT:
TRIMARK PICTURES, INC., a California corporation
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
--------------------------------------------------------
Title: Vice President, Business Affairs
----------------------------------------------------
By: /s/ ▇▇▇▇ ▇▇▇▇
--------------------------------------------------------
Title: Chairman, Chief Executive Officer
----------------------------------------------------
EXHIBIT C
CONSTRUCTION PROVISIONS
1. These provisions define the scope of work to be provided by
Landlord in the Premises under the terms of the Lease. Words and phrases used
herein which are defined in the Lease have the meanings set forth therein unless
provided otherwise.
2. It is the intent of these provisions that Tenant shall be
permitted freedom in the interior design and layout of its space so long as same
is consistent with Landlord's policies and structural requirements, applicable
building codes, and with sound architectural and construction practices, and
provided further that no interference is caused to the operation of the
Building's mechanical, heating, cooling or electrical systems or structure, or
other Building operations or functions, and that no unusual increase in
maintenance, insurance, taxes, fees or utility charges will be incurred by
Landlord or the other tenants in the Building as a result thereof. Any
additional cost of design, construction, operation, insurance, maintenance,
taxes, fees or utilities which results therefrom shall be charged to Tenant and
paid for by Tenant in accordance with the provisions hereof and of the Lease.
3. Landlord's Work. Landlord hereby grants Tenant a construction
allowance not to exceed $20.00 per usable square foot of the Premises (the
"Allowance") which Allowance shall be used only as a credit towards the cost of
the following services and materials (hereinafter referred to as "Landlord's
Work"):
3.1 The services of Landlord's space planner to prepare one (1)
approved space layout and one (1) set of approved working drawings [with five
(5) prints]. One minor revision to the original space layout will be included
without charge. All other revisions and prints as well as all interior design
or decorating fees, shall be at Tenant's sole cost and expense.
3.2 The construction of the improvements and the installation
of the items shown in Schedule A attached hereto, which shall be installed in
the Premises substantially in accordance with the "Plans", hereinafter defined
(as used in the Lease and this Exhibit C, the term "Building Standard" refers to
the minimum quality of materials to be used in the construction of the
Premises).
3.3 Fees for engineering, construction management by Landlord's
Construction Manager (as hereinafter set forth), and previously installed
materials used in the construction (if any).
3.4 Permits and license fees relating to the construction of
Tenant's improvements.
4. Tenant's Work. All costs incurred in excess of the foregoing
Allowance (hereinafter referred to as "Tenant's Work") shall
be for the account of Tenant and at Tenant's sole cost and expense. Tenant shall
pay building lifting charges (if any) for Tenant's Work to the extent the same
are not otherwise included in the cost of Landlord's Work.
5. Space Planner. Tenant shall use the services of the space planner
retained by Landlord to prepare a space layout and working drawings and
specifications for all construction work in the Premises. Interior design, and
details and specifications for improvements other than Landlord's Work, shall be
for the account of Tenant and shall be paid by Tenant upon invoice therefore.
Tenant shall devote such time in consultation with Landlord's space planner as
shall be necessary to enable the space planner to develop complete working
drawings and specifications (hereinafter referred to as the "Plans") for
construction of improvements in the Premises, showing thereon partitions, doors,
electrical and telephone outlets, light fixture locations, wall finishes, floor
coverings and special requirements (if any) for Tenant's review and approval.
Failure of Tenant to approve the Plans within the time limit specified in
Section 7 hereof shall be deemed disapproval. If Tenant requests or
necessitates any changes or revisions in the Plans after they have been
approved, Tenant shall bear all costs associated therewith.
6. Cost Estimates. As soon as practicable after Tenant's execution
of this Lease, Landlord will advise Tenant of the estimated cost payable by
Tenant due to costs for improvements, services or materials in excess of or
differing from Landlord's Work (i.e., the estimated cost for Tenant's Work).
Landlord will have no obligation whatsoever to commence construction of any
improvements in the Premises unless Tenant approves same and pays the estimated
costs for Tenant's Work in advance, and Landlord's refusal to proceed under such
circumstances shall not defer the Commencement Date. Upon Tenant's
authorization to proceed and payment of such estimated costs, Landlord shall
commence the construction of improvements in the Premises. Upon substantial
completion of the Premises (which in the event of a dispute shall be determined
by Landlord's project architect pursuant to AIA standards), Tenant shall pay the
amount of actual costs in excess of such estimated costs previously paid by
Tenant or, if the actual costs are less than such estimated costs previously
paid by Tenant, Landlord shall reimburse the difference to Tenant. If Tenant
fails to make such payment within ten (10) days after receipt of a demand
therefor, Landlord shall have the same rights and remedies as in the case of a
default by Tenant in the payment of Rent under the Lease, and interest will
accrue thereon at the Agreed Rate.
7. Time Limits. The following maximum time periods shall be allowed
for the indicated matters:
Time Limit After Completion
Action of Preceding Item
------ ---------------------------
(a) Tenant meets with Landlord's
space planner and approves
initial space layout. days after lease execution
(b) Tenant furnishes all required
working drawing information to
Landlord's space planner. 10 business days
(c) Landlord's space planner submits
working drawings to Tenant for
review and approval. 15 business days
(d) Tenant gives Landlord its
approval of working drawings,
with any required changes
in detail 5 business days
(e) Landlord quotes estimated cost
to Tenant for Tenant's Work. 10 business days
(f) Tenant approves such estimated
costs and pays the amount thereof
to Landlord and authorizes
Landlord to proceed. 5 business days
(g) Upon substantial completion
of the improvements in the
Premises (i.e., exclusive of
punchlist items) Tenant pays
the entire then remaining balance
of actual costs in excess of
the Allowance within ten (10) days
after its receipt of a billing
statement from Landlord.
It is expressly acknowledged by Tenant that inaccurate or incomplete information
furnished by Tenant may cause delays and that delays in the time schedule set
forth in this Section 7 attributable to Tenant, its agents or contractors will
result in liquidated damages as set forth in Section 12 hereof.
8. Construction by Landlord's Contractor. Unless otherwise agreed in
writing in this Exhibit C, all construction work in the Premises including
Tenant's Work shall be performed by the Tenant Improvement Contractor ("TI
Contractor") retained by Landlord. The TI Contractor shall perform such work in
a good and workmanlike manner and shall construct the improvements in the
Premises substantially in
accordance with the Plans. All such construction work shall be performed in
accordance with all laws, ordinances and requirements of government agencies
having jurisdiction. If Landlord shall, pursuant to this Exhibit C, permit
Tenant to have any work performed by a contractor retained by Tenant rather than
by the TI Contractor, then (i) Tenant shall use only such contractor as shall
have first been approved by Landlord; (ii) such contractor shall be bondable,
(iii) Landlord will permit entry of such contractor into the Premises for the
purpose of performing such work, prior to commencement of the term of the Lease,
and while the TI Contractor is working at the Premises, but only at such time or
times as Landlord shall deem feasible in the circumstances; (iv) such license to
enter before commencement of the term is expressly conditioned upon the
contractor retained by Tenant working in harmony and not interfering with the
workmen, mechanics and contractors of Landlord or of any other tenant in the
Building or the Project, and if at any time such entry or work by Tenant's
contractor shall cause any disharmony or interference, such permission to enter
may be withdrawn by Landlord immediately upon written notice to Tenant; (v)
worker's compensation, public liability and property damage insurance, all in
amounts and with companies and on forms satisfactory to Landlord, shall be
provided and at all times maintained by Tenant's contractor, and before
proceeding with the work, certificates of such insurance shall be furnished to
Landlord; (vi) such entry shall be deemed to be under all the terms, covenants,
provisions and condiions of the Lease, except the covenant to pay Rent and
Expenses; and (vii) all materials, work, installations and decorations of any
nature whatsoever brought on or installed in the Premises before the
commencement of the term of the Lease shall be at Tenant's risk, and neither
Landlord nor any party acting on Landlord's behalf shall be responsible for any
damage thereto or loss or destruction thereof.
9. Construction Manager. Landlord has designated a "Construction
Manager" who shall be responsible for the management and coordination of all
work to be performed in the Premises and coordination with Tenant on all matters
governed by these Construction Provisions. The Construction Manager shall be
paid a fee equal to three percent (3%) of the cost of the improvements, services
and materials furnished as a part of Landlord's Work and Tenant's Work as
reimbursement for the expense of administration and coordination of such work.
With regard to all matters involving such work, Tenant shall communicate with
the Construction Manager rather than the TI Contractor. Landlord shall not be
responsible for any statement, representation or agreement made between Tenant
and TI Contractor. It is hereby expressly acknowledged by Tenant that such TI
Contractor is not Landlord's agent and has no authority whatsoever to enter into
agreements on Landlord's behalf or otherwise bind Landlord. The Construction
Manager will furnish Tenant with notices of substantial completion, cost
estimates for Tenant's Work, Landlord's approvals or disapprovals of Plans and
changes thereto, ▇▇▇▇▇▇▇▇ for actual costs of Tenant's Work and other similar
notices. Tenant shall deliver all payments required hereunder to the
Construction Manager unless written notice is given by Landlord to the contrary.
10. Changes. If Tenant requests or necessitates any change, addition
or deletion to the Premises after approval of the Plans, as described in Section
7 above, a request for the change shall be submitted to the Construction Manager
accompanied by revised plans prepared by Landlord's space planner at Tenant's
sole expense. The Construction Manager shall thereafter notify Tenant in
writing of the estimated cost which will be chargeable to Tenant by reason of
such change, addition or deletion. Such estimated cost shall include Landlord's
cost of any delay in completion of the Premises resulting from such change
(including, but not limited to, loss of income, additional interest, penalties,
and extra labor costs incurred in order to minimize further delay). Tenant
shall within five (5) business days thereafter notify the Construction Manager
in writing whether it desires to proceed with such change. In the absence of
such written authorization within that five (5) day period, Landlord shall not
be obligated to perform such change and shall be deemed to have been authorized
by Tenant to proceed without making such change.
11. Substitutions. Tenant may select different new materials (except
exterior window levelors which must be installed on all exterior windows, the
ceiling system, parabolic light fixtures, and the doors and frames and hardware)
in substitution for the materials specified as the building standard, provided
the selection is indicated on the approved Plans.
12. Responsibility for Delays. Tenant hereby expressly agrees that if
Tenant is responsible for any delay in substantial completion of the Premises,
whether by reason of (i) failure to meet the time schedule set forth in Section
7 above, (ii) delays in performance or completion by a party employed by Tenant,
(iii) building code problems arising from Tenant's design, or (iv) an unapproved
change in the work necessitated by Tenant, Landlord will suffer loss or damage
(which loss or damage may include administrative costs, attorneys' fees, excess
interest penalties and loss of income), the amount of which would be extremely
difficult to ascertain. Therefore, it is expressly agreed that for each day of
such delay attributable to Tenant the Commencement Date shall be accelerated and
Tenant shall pay to Landlord an amount equal to the daily amount of Basic Rent
under the Lease, as liquidated damages for such delay and not as a penalty.
Furthermore, if Tenant fails to approve the Plans within ninety (90) days after
execution of the Lease or fails to pay the estimated costs of Tenant's Work
within thirty (30) days after the same become due and payable, Landlord may (but
need not) terminate the Lease for default upon written notice to Tenant and in
such event Landlord shall not be precluded by reason of the foregoing from
recovering any additional damages it may suffer as a result of such termination.
It is acknowledged and agreed by Tenant that notwithstanding the provisions for
liquidated damages hereinabove set forth, if the Lease is terminated for default
as set forth above such liquidated damages shall not be deemed to compensate
Landlord for the amount of damage, if any, which Landlord may incur as a result
of such termination, and Landlord will not be precluded, by reason of such
liquidated damages
provisions, from pursuing any rights or remedies available under the law for
losses incurred as a result thereof.
13. Incorporation by Reference. This Exhibit C is and shall be
incorporated by reference in the Lease, and all of the terms and provisions of
the Lease are incorporated herein by this reference. Schedule A to this Exhibit
C is hereby incorporated by this reference in the Lease and in this Exhibit.
14. Attorneys' Fees. In the event of any action or proceeding
initiated by a party hereto for the enforcement or interpretation of the
provisions contained herein, the prevailing party shall be entitled to recover
its costs incurred in connection therewith, including its reasonable attorneys'
fees.
EXHIBIT F
BUILDING RULES AND REGULATIONS
The following rules and regulations shall be applicable to the Building:
1. No sign, placard, picture, advertisement name or notice shall be
inscribed, displayed or printed or affixed on or to any part of the Building or
Premises if visible from outside the Premises, without the prior written consent
of Landlord. Tenant's identification signs and lettering shall be in accordance
with Landlord's standard requirements for the Building unless otherwise approved
in writing by Landlord, and shall be printed, affixed or inscribed at the
expense of Tenant by a person approved by Landlord.
2. Tenant shall not place or maintain any window covering, blinds or
drapes on any window without Landlord's prior written approval. A breach of
this rule will directly and adversely affect the exterior appearance of the
Building. Upon request by Landlord, Tenant shall remove any window covering, or
any other item visible from outside the Premises, if installed or placed without
Landlord's written approval.
3. A directory of the Building has been provided for the display of
the name and location of tenants. Within thirty (30) days after the
Commencement Date, Landlord will install at Landlord's expense directory strips
for Tenant's name and a reasonable number of the principal employees thereof,
and Landlord reserves the right to exclude any other names therefrom.
Subsequent changes to the directory will be at Tenant's sole cost and expense.
4. The sidewalks, halls, passages, exits, entrances, elevators,
escalators and stairways shall not be obstructed by Tenant or used by it for any
purpose other than for ingress to and egress from the Premises. The halls,
passages, exits, entrances, elevators, escalators, stairways, balconies and roof
are not for the use of the general public and Landlord shall in all cases retain
the right to control and prevent access thereto by all persons whose presence in
the judgment of Landlord might be prejudicial to the safety, character,
reputation and interests of the Building and its tenants, provided that nothing
herein contained shall be construed so as to prevent such access to persons with
whom Tenant normally deals in the ordinary course of Tenant's business unless
such persons are engaged in illegal activities or are creating a nuisance. No
employee, invitee, contractor or agent of Tenant shall go upon the roof of the
Building.
5. Tenant shall be responsible for assuring that doors to the
Premises are locked during non-business hours. Such doors shall not be left
open during business hours, except while moving furniture or other items in or
out of the Premises, unless Landlord consents otherwise.
6. The toilet rooms and urinals, wash bowls and other apparatus
therein shall not be used for any purpose other than that for which they were
constructed and no foreign substance of any kind whatsoever shall be placed
therein; the expense of breakage, stoppage or damage resulting from the
violation of this rule shall be borne by the tenant who, or whose employees,
invitees, contractors or agents, shall have caused it.
7. Except as to normal pictures and furnishings, Tenant shall not
▇▇▇▇, drive nails, screw or drill into partitions, woodwork or plaster or in any
way deface the Premises or any part thereof. No boring, cutting or stringing of
wires shall be permitted except with the prior written consent of Landlord and
as Landlord may direct. Tenant shall not lay linoleum, tile, carpet or other
similar floor covering so that the same shall be affixed to the floor of the
Premises in any manner except as approved by Landlord. The expense of repairing
any damage resulting from a violation of this rule or removal of any floor
covering shall be borne by Tenant.
8. Tenant shall not overload any floor of the Premises or the
Building. No furniture, freight or equipment of any kind shall be brought into
the Building by Tenant or its contractors or agents without prior consent of
Landlord and all moving of the same into or out of the Building shall be done at
such time and in such manner as Landlord shall designate. Landlord shall have
the right to prescribe the weight, size and position of all safes and other
heavy objects brought into or out of the Building and also the time and manner
of moving same in and out of the Building. Safes and other heavy objects shall,
if considered necessary by Landlord, stand on wood strips of such thickness as
is necessary to properly distribute weight. Landlord will not be responsible
for loss or damage to any property from any such cause, and all damage done to
the Building by moving or maintaining any such safe or other property shall be
repaired at the expense of Tenant. There shall not be used in any part of the
Building any hand truck unless it is equipped with rubber tires and side guards.
9. Tenant shall not employ any person or persons other than the
janitor of Landlord for the purpose of cleaning the Premises unless otherwise
agreed to in writing by Landlord. Except with the prior written consent of
Landlord, no person or persons other than those approved by Landlord shall be
permitted to enter the Building for the purpose of cleaning same. Tenant shall
not cause any unnecessary labor by reason of Tenant's carelessness or
indifference in the preservation of good order and cleanliness. Landlord shall
in no way be responsible to Tenant for any loss of property on the Premises,
however, occurring, or for any damage done to the effects of Tenant or any of
its employees or other persons by the janitor of Landlord. Janitor shall
include ordinary dusting and cleaning by the janitor assigned to such work and
shall not include cleaning of carpets or rugs, except normal vacuuming, or
moving of furniture and other special services. Janitor service will not be
furnished to rooms
which are occupied after 9:30 p.m. Window cleaning shall be done only by
Landlord at reasonable intervals and as Landlord deems necessary.
10. Tenant shall not use, keep or permit to be used or kept any
noxious gas or substance in the Premises, or permit or suffer the Premises to be
occupied or used in a manner offensive or objectionable to Landlord or other
occupants of the Building by reason of noise, odors, and/or vibrations, or
interfere in any way with other tenants or those having business therein. No
tenant shall make or permit to be made any loud or disturbing noises or
interfere with occupants of the Building or those having business with them
whether by the use of any musical instrument, radio, phonograph, shouting or in
any other manner. Tenant shall not throw anything out of doors or down the
passageways.
11. The Premises shall not be used for the storage of merchandise
except as such storage may be incidental to the use of the Premises authorized
by the Lease. No cooking shall be done or permitted in the Premises without
Landlord's consent, except that use by Tenant of Underwriter's Laboratory
approved microwave ovens or equipment for brewing coffee or similar beverages
shall be permitted. Tenant shall not advertise for day laborers giving an
address at the Premises. The Premises shall not be used for lodging or for any
illegal purposes. Tenant shall not keep or maintain pets or animals of any type
and shall not store or keep bicycles, mopeds, or motorcycles in the Premises or
the Building.
12. Tenant shall not use or keep in the Premises or the Building any
kerosene, gasoline or flammable or combustible fluid or material, or use any
method of heating or air conditioning other than that supplied or permitted by
Landlord.
13. Landlord will direct electricians as to where and how electrical,
telephone and telegraph wires are to be introduced into the Premises. No boring
or cutting for wires will be allowed without the prior consent of Landlord. The
location of telephone switching equipment, call boxes and other similar
equipment in the Premises shall be subject to the approval of Landlord.
14. Landlord will furnish Tenant free of charge two (2) keys for each
locking door in the Premises. Any additional or replacement keys will be
furnished at a reasonable charge. All keys to offices, rooms and toilet rooms
shall be obtained from Landlord and Tenant shall not duplicate or obtain such
keys from any other source. Upon termination of the Lease, Tenant shall deliver
to Landlord the keys to the offices, rooms and toilet rooms which were
previously furnished to Tenant, failing which Tenant shall pay Landlord the cost
of replacing same or of changing the lock or locks opened by any unreturned key
if Landlord deems it necessary to make such changes. Landlord shall have the
right periodically to change all locks and furnish Tenant with new keys
therefor. Tenant shall not alter any lock or install any new or additional
locks or any bolts on any door of the Premises without the prior written consent
of Landlord (except as to safes, vaults and
other secured areas of Tenant approved by Landlord).
15. No furniture, packages, supplies, equipment or merchandise will be
received in the Building or carried up or down in the elevators except between
such hours and in such elevators as shall be designated by Landlord.
16. Landlord reserves the right to close and keep locked all entrances
and exit doors of the Buildings on Saturdays, Sundays, legal holidays and on
other days between non-business hours, and during such further hours as Landlord
may deem advisable for the adequate protection of the Building and the property
of its tenants (such hours are referred to as "After-Hours"). However, during
such After-Hours Tenant and or authorized employees as well as guests, licensees
or invitees of Tenant who are accompanied by Tenant or an authorized employee of
Tenant, shall be allowed access to the Building upon proper identification.
Landlord shall in no case be liable for damages for any error with regard to the
admission to or exclusion from the Building of any person. In case of
invasion, mob, riot, public excitement, or other commotion, Landlord reserves
the right to prevent access to the Building during the continuance of same.
17. The "normal business hours" for the Building are from 7:00 a.m. to
6:00 p.m., Monday through Friday and 9:00 a.m. to 1:00 p.m. on Saturday,
excluding nationally recognized standard holidays. All other hours are deemed
"After-Hours".
18. Tenant shall not canvass or solicit other tenants in the Building
and Tenant shall cooperate to prevent any such canvassing and/or solicitation.
Canvassing and peddling in the Building is prohibited. Tenant shall not obtain
for use in the Premises food, beverage, shoe-shine or other services except as
expressly permitted by Landlord.
19. Landlord reserves the right to exclude from the Building any
person who, in the judgment of Landlord is intoxicated or under the influence of
liquor or drugs, has no legitimate purpose to be in the Building, or is
violating the rules and regulations of the Building.
20. The requirements of Tenant will be attended to only upon
application to Landlord's designated property manager. Tenant acknowledges that
employees of Landlord shall have no obligation to perform any work for Tenant or
do anything outside their regular duties for Tenant unless under special
instructions from Landlord, and that no employee will have any obligation to
admit any person (Tenant or otherwise) to any office of Landlord without
specific instructions from Landlord.
21. No vending machines of any description shall be installed,
maintained, or operated by Tenant upon the Premises or in the Building, without
the prior written consent of Landlord.
22. Tenant agrees that it shall comply with all fire and security
regulations that may be issued from time to time by Landlord, and Tenant shall
also provide Landlord with the name of a designated responsible employee to
represent Tenant in all matters pertaining to such fire or security regulations.
23. Tenant shall not install any radio or television antenna,
loudspeaker or other device on the roof or exterior walls of the Building.
Tenant shall not interfere with broadcasting or reception from or in the
Building or elsewhere.
24. Tenant shall store its trash and garbage within the Premises or in
other facilities designated by Landlord. Tenant shall not place in any trash
receptacle any material which cannot be disposed of in the ordinary practice of
trash disposal. All trash and garbage disposal shall be made pursuant to
directions issued from time to time by Landlord.
25. Landlord may waive any one or more of the rules and regulations as
to any tenant without being construed as having waived same as to any other
tenant.
26. Tenant shall be responsible for the observance of the rules and
regulations by Tenant's employees, agents, customers, invitees and guests.
27. Landlord reserves the right upon written notice to Tenant, to
rescind, alter or waive any rule or regulation at any time prescribed for the
Building, or to establish additional rules and regulations when, in Landlord's
sole judgment, it is necessary, desirable or proper for the best interest of the
Building and its tenants.
28. The rules and regulations shall be administered fairly by Landlord
and Landlord shall not enforce them in a discriminatory manner as between the
tenants of the Building.
PARKING LICENSE AGREEMENT
TIAA REALTY, INC., a Delaware corporation ("Licensor"), hereby grants to
TRIMARK PICTURES, INC., ("Licensee"), the right and license to use parking
spaces in MARINA BUSINESS CENTER II (the "Project"), as described below and
subject to the following conditions:
1. Type and Number of Parking Spaces. Licensee shall have the right
to use up to ninty-three (93) unassigned automobile parking spaces. If the area
of Licensee's Premises in the Project is reduced, Licensee's allotment of
parking spaces will be adjusted proportionately. If the area of Licensee's
Premises is increased, Licensee may, at its option, increase the number of its
allotted parking spaces proportionately. Notwithstanding the preceding,
Licensee shall have no right to use any number of parking spaces in excess of
the number of employees of Licensee actually employed at the Premises.
2. Monthly Fee. Licensee shall pay for the right and license granted
hereby the prevailing rates charged for such spaces by Licensor from time to
time ("market rate"); as of the date hereof, the market rate per space per month
is $35.00 (exclusive of City of Los Angeles taxes). Licensor agrees, during the
initial term of the Lease, the market rate per space shall not increase more
than Five Dollars ($5.00) per year. Such sums shall be payable in advance on
the first day of each calendar month. Licensor shall have no obligation to
accept any such payment from anyone other than Licensee (e.g. Licensee's
employees, subtenants, etc.). If Licensee fails to make any such payment when
due, Licensor, at its option and after five (5) days' notice to Licensee, may
forthwith terminate this license and all rights of Licensee hereunder. Any late
payment of the monthly fee will result in additional administrative and
processing costs being incurred by Licensor, the exact amount of which would be
extremely difficult to determine, and it is agreed that with respect thereto a
late fee of Ten Dollars ($10.00) per space is a reasonable estimate thereof and
will be payable by Licensee with regard to any monthly fee not paid when due.
3. Term. Licensee shall be entitled to the foregoing parking rights
for a period equivalent to the term of that certain "Lease" of Premises in the
Project entered into by Licensor and Licensee. Licensee's rights to any and all
parking spaces shall automatically be revoked and shall terminate upon any
material default hereunder, or any expiration or termination of said Lease, as
well as upon any assignment of such Lease or sublease of such Premises, in
violation of the terms of such Lease. Licensee must exercise its rights under
this Agreement by delivering all required security deposits and the initial
monthly fee for the parking spaces described above within thirty (30) days after
the "Commencement Date" of the aforementioned Lease (as defined herein) unless
otherwise agreed by Licensor. Failure of Licensee to so exercise its rights
will entitle Licensor without notice to transfer to others Licensee's rights to
park in any and all parking spaces as to which Licensee has not so exercised its
rights
hereunder, and Licensee will be deemed to have waived its rights hereunder with
regard thereto.
4. Location of Parking Spaces. Licensor shall have the right in its
sole discretion to designate the particular location of said parking space(s),
which designation is subject to change from time to time.
5. Rights Non-Transferrable. The foregoing parking rights are
personal to Licensee and Licensee shall not assign, convey, or otherwise
transfer said rights in any manner whatsoever without Licensor's prior written
consent. Any attempt by Licensee to do so shall be null and void and, at
Licensor's election, shall constitute a material default hereunder. If the
Premises or any portion thereof is assigned or sublet pursuant to the terms of
the Lease, the number of parking spaces allotted to Licensee under paragraph 1
hereof shall automatically be adjusted accordingly and Licensor and Licensee
shall immediately execute an amendment to this Agreement setting forth (i) the
number of spaces retained by Licensee, (ii) the number of spaces allotted to
Licensee's assignee or subtenant (which number shall not exceed the amount
stated in paragraph 1 above), (iii) the then current "market rate" to be charged
Licensee for the spaces allotted to its assignee or subtenant, and (iv) the
security deposit to be paid by Licensee for its assignee's or subtenant's
parking cards.
6. Licensee Indemnification. Use of said parking spaces and of the
parking areas in the Project shall be at the sole risk of Licensee. Unless
caused by the negligence or wrongful acts of Licensor, its agents or employees,
Licensee hereby agrees to defend, indemnify and hold Licensor harmless against
any liability, cost or expense (including reasonable attorneys' fees) for any
damage to or loss or theft of any vehicle or property within any vehicle or any
other property (including property of Licensee), or injury to or death of any
person (including Licensee and Licensee's family, agents, employees, visitors or
customers), arising directly or indirectly out of or in connection with the use
by Licensee or such other persons of the parking areas or any part thereof.
7. Interruption of Use. Licensor shall not be liable to Licensee for
any interruption of Licensee's use of the rights granted hereunder due to
repairs, improvements or alterations of the parking areas or the Project, or due
to any labor controversy, or resulting from any cause beyond the reasonable
control of Licensor. However, Licensee shall be entitled to an abatement of the
monthly fee with regard to any assigned parking space to the extent it is
prevented from using such space and no reasonably similar alternative space is
made available to it by Licensor.
8. Rules and Regulations. Licensor's parking rules and regulations
are attached hereto. Licensor may adopt such other rules and regulations
relating to the use of the parking areas as in Licensor's opinion are necessary
or desirable for the proper, orderly and safe use of the parking areas. If
Licensee fails to comply with
the rules and regulations and modifications thereto after receiving notice
thereof, Licensor may at its option forthwith terminate this license and all
rights of Licensee hereunder, and may also, whether or not such license is so
terminated, take such action as shall be required to remedy such failure, and
Licensee agrees to pay Licensor on demand the reasonable cost to Licensor of
such actions including attorneys' fees. Licensee shall at all times be required
to park in a lawful manner, and no vehicle shall at any time be parked in more
than one marked space at a time. Licensor shall be entitled to tow away any
vehicle which is improperly parked, at the vehicle owner's sole cost and
expense. In the event of such tow away, neither Licensor nor any Mortgagee of
Licensor shall have any liability therefor to Licensee or to such vehicle owner.
9. Licensor's Property Rights. Licensor shall have the right to
decrease the size of any or all of the parking areas in the Project, to alter or
rearrange parking spaces and improvements in the parking areas, to take all or
any portion of the parking areas for purposes of maintaining, repairing or
restoring same, or for purposes of construction and operating structures thereon
or adjacent thereto, to have ingress and egress in connection with the exercise
of any such rights, and to do and perform such other acts with respect to the
parking areas as Licensor shall in its discretion deem appropriate. Licensor
may at any time and from time to time in its discretion designate any portion of
the parking areas in the Project for use as assigned parking, visitor parking or
employee parking. If Licensor establishes an "employee parking" area or other
assigned parking area for Licensee's employees to park in, Licensee shall
furnish Licensor, within five (5) days after written request to do so, with a
list of the vehicle license numbers of Licensee's employees parking in the
Project. Licensor may charge Licensee Ten Dollars ($10.00) per day for each day
or partial day for each vehicle parked by Licensee or any of its employees in a
parking space or area other than the space or parking area assigned or
designated for such vehicle. Licensor may tow away any such improperly parked
vehicles and may also attach violation notices or stickers to improperly parked
vehicles. In the event of such tow away, neither Licensor nor any Mortgagee of
Licensor shall have any liability therefor to Licensee or to such vehicle owner.
10. Security Deposit. If parking is in a controlled lot, a monthly
parking card or decal may be issued to Licensee for each parking space to be
used by Licensee hereunder. Licensee will pay a security deposit for each
parking card at the time of issuance of the card. Licensor shall have no
obligation to accept any such security deposit from anyone other than Licensee.
The security deposit shall be held by Licensor to secure Licensee's due
performance of its obligations with regard to parking hereunder and the return
to Licensor of such parking card(s) in good condition, normal wear and tear
excepted, upon termination of Licensee's rights hereunder. Licensee shall be
obligated to take reasonable steps to protect such cards from warping or
mutilation. Without limitation as to the generality of the foregoing, Licensor
may apply such security deposit to remedy any default by Licensee hereunder and
further, if such card(s) are lost or mutilated, Licensor may apply any or all of
said deposit towards Licensor's cost of such card(s). If at any time Licensor
applies any or all of such security deposit as provided herein, Licensee shall
be obligated to deposit with Licensor the amount so applied by Licensor within
ten (10) days after written request therefor is given. Upon termination of
Licensee's rights hereunder and the return to Licensor of the aforementioned
card(s) (or cards issued in substitution thereof) the security deposit or
balance thereof shall be returned to Licensee provided Licensee is not then in
default hereunder. Licensor need not hold said security deposit in a separate
account.
11. Replacement Cards. If for any reason (other than a malfunction
for which Licensee is not responsible hereunder) any card issued to Licensee is
requested by Licensee to be replaced, Licensee shall pay Licensor the then
current non-refundable charge for said replacement card.
12. Miscellaneous. No waiver by Licensor of any breach of this
agreement by Licensee shall constitute a waiver of any other breach. Any amount
due to Licensor that is not paid when due shall bear interest at the maximum
rate allowable under law. In the event of any legal action taken or proceeding
brought to enforce the provisions hereof, the prevailing party shall be entitled
to recover its reasonable attorneys' fees and costs incurred in connection
therewith.
DATED this 5th day of May, 1999.
LICENSOR: TIAA REALTY, INC., a Delaware corporation
By: TEACHERS INSURANCE AND ANNUITY ASSOCIATION, a New
York corporation, its authorized representative
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Assistant Secretary
--------------------------------------------------------
LICENSEE:
TRIMARK PICTURES, INC., a California corporation
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
--------------------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------------------------
Title: Vice President, Business Affairs
-----------------------------------------------------
By: /s/ ▇▇▇▇ ▇▇▇▇
--------------------------------------------------------
Name: ▇▇▇▇ ▇▇▇▇
-----------------------------------------------------
Title: Chairman, Chief Executive Officer
-----------------------------------------------------
PARKING RULES AND REGULATIONS
1. All claimed damage or loss must be reported and itemized in
writing delivered to the parking facility office or property manager's office
within ten (10) business days after any claimed damage or loss occurs. Any
claim not so made is waived. Licensor has the option to make repairs at its
expense of any claimed damage within ten (10) business days after filing of a
claim. In all court actions the burden of proof to establish a claim remains
with Licensee. Court actions by Licensee for any claim must be filed within
ninety (90) days from date of parking, in a court of jurisdiction where the
claimed loss occurred. Licensor is not responsible for damage by water, fire,
or defective brakes, or parts, or for the acts or omissions of others, or for
loss of articles left in vehicles. The total liability of Licensor is limited
to Two Hundred Fifty Dollars ($250.00) for all damages or loss to any vehicle.
Licensor is not responsible for loss of use.
2. Licensee shall not park or permit the parking of any vehicle under
its control in any parking area designated by Licensor as areas for parking by
visitors. Licensee shall not leave vehicles in the parking area overnight nor
park any vehicles in the parking areas other than automobiles, motorcycles,
motor driven or non-motor driven bicycles or four-wheeled trucks.
3. Parking stickers or any other device or form of identification
supplied by Licensor as a condition of use of the parking facilities shall
remain the property of Licensor. 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 transferrable and any device in the possession of an unauthorized holder
will be void.
4. No extended term storage of vehicles shall be permitted.
5. Vehicles must be parked entirely within the painted stall lines of
a single parking stall.
6. All directional signs and arrows must be observed.
7. The speed limit within all parking areas shall be five (5) miles
per hour.
8. Parking is prohibited:
(a) in areas not striped for parking;
(b) in driveways;
(c) where "no parking" signs are posted;
(d) in cross-hatched areas; and
(e) in such other areas as may be designated by Licensor or its
parking operator.
9. Every ▇▇▇▇▇▇ is required to park and lock his own vehicle unless
Licensor furnishes valet service. Valet parking attendants may refuse to drive
any vehicle reasonably believed to be unsafe.
10. Loss or theft of parking identification devices from vehicles must
be reported to the parking operator immediately, and a lost or stolen report
must be filed at that time.
11. Any parking identification device reported lost or stolen found on
any unauthorized vehicle will be confiscated and the illegal holder will be
subject to prosecution.
12. Lost or stolen identification devices found by Licensee should be
reported to the parking facility office or property manager immediately to avoid
confusion.
13. Washing, waxing, cleaning or servicing of any vehicle in any area
not specifically reserved for such purpose is prohibited.
14. Licensee shall acquaint all persons to whom Licensee assigns
parking spaces of these Rules and Regulations. Parking facility managers or
attendants are not authorized to make or allow any exceptions to these Rules and
Regulations.
15. Licensor reserves the right to refuse the sale of monthly stickers
or other parking identification devices to any person and/or his agents or
representatives who willfully refuses to comply with these Rules and
Regulations.