Exhibit 10.3
STANDARD OFFICE LEASE
BY
AND BETWEEN
CAMARILLO OFFICE PARTNERS I, LLC,
a California limited liability company,
AS LANDLORD,
AND
AURIGA LABORATORIES, INC.,
a Delaware corporation,
AS TENANT
SUITE 150
___________________________________________
5284 Adolfo Road, Camarillo, California
PAGE
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ARTICLE
1
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Basic
Lease Provisions
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(b)
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Increase
in Direct Costs
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[
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(d)
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Determination
of Payment
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(e)
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Tenant's
Payment of Certain Tax Costs
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ARTICLE
4
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Security
Deposit
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ARTICLE
8
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Condition
of Premises
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ARTICLE
9
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Repairs
and Alterations
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(a)
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Landlord’s
Obligation
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(e)
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Costs
and Fees; Removal
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ARTICLE
11
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Project
Services
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(c)
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Additional
Electrical Services
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[
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(h)
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Sole
Electrical Representative
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ARTICLE
12
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Rights
of Landlord
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ARTICLE
13
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Indemnity;
Exemption of Landlord from Liability
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(b)
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Exemption
of Landlord from Liability
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(d)
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Waiver
of Subrogation
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ARTICLE
15
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Assignment
and Subletting
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ARTICLE
16
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Damage
or Destruction
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ARTICLE
18
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Eminent
Domain
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ARTICLE
21
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Transfer
of Landlord's Interest
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ARTICLE
25
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Estoppel
Certificate
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ARTICLE
26
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Liability
Of Landlord
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ARTICLE
27
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Inability
To Perform
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ARTICLE
28
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Hazardous
Waste
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ARTICLE
29 SURRENDER OF PREMISES; REMOVAL OF
PROPERTY
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(a)
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Severability;
Entire Agreement
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(b)
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Attorneys'
Fees; Waiver of Jury Trial
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(d)
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Headings;
Joint and Several
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(g)
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Use
of Project Name; Improvements
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(h)
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Rules
and Regulations
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(k)
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Successors
and Assigns
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(m)
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Persistent
Delinquencies
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(n)
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Right
of Landlord to Perform
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(o)
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Access,
Changes in Project, Facilities, Name
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(q)
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Identification
of Tenant
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(s)
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Survival
of Obligations
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(w)
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Independent
Covenants
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(z)
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Office
of Foreign Assets Control
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ARTICLE
31
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SIGNAGE/DIRECTORY
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ARTICLE
32
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OPTION
TO RENEW
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(d)
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Determination
of Market Rent
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Exhibit "B"
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Rules
and Regulations
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Exhibit "C"
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Notice
of Lease Term Dates and Tenant's Proportionate Share
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DEFINED TERMS PAGE
Additional
Rent 3
Affiliate 17
Alterations 9
Base
Year 1
Basic
Rental 1
Brokers 1
Commencement
Date 1
Direct
Costs 3
Estimate 5
Estimate
Statement 5
Estimated
Excess 5
Event
of Default 20
Excess 5
Expiration
Date 1
First
Month's Rent 2
Force
Majeure 25
Hazardous
Material 26
Landlord 1
Laws 26
Lease 1
Lease
Year 2
Operating
Costs 4
Parking
Passes 2
Partnership
Tenant 30
Permitted
Use 1
Premises 1
Project 1
Real
Property 3
Review
Period 5
Security
Deposit 1
Square
Footage 1
Statement 5
Tax
Costs 3
Tenant 1
Tenant
Improvements 9
Tenant's
Proportionate Share 1
Term 1
Transfer 16
Transfer
Premium 16
Transferee 16
STANDARD OFFICE LEASE
This
Standard Office Lease (" Lease ") is made and
entered into as of this 13th day of December, 2007, by and
between CAMARILLO OFFICE PARTNERS I LLC, a California limited
liability company (" Landlord "), and AURIGA
LABORATORIES INC., a Delaware corporation ("
Tenant ").
Tenant
hereby leases from Landlord the premises described as Suite
No. 150, as designated on the plan attached hereto and
incorporated herein as Exhibit "A" ("
Premises "), of the project ("
Project ") whose address is 5284 Adolfo Road,
Camarillo, California, for the Term and upon the terms and
conditions hereinafter set forth, and Landlord and Tenant
hereby agree as follows:
ARTICLE 1
BASIC LEASE PROVISIONS
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A.
Term :
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Thirty-six
(36) months.
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Commencement Date :
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February
15, 2008.
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Expiration Date :
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February
28, 2011
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B.
Premises :
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19,496
rentable square feet
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C.
Basic Rental :
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Period
of Term
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Annual
Basic
Rental
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Monthly
Basic
Rental
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Monthly
Basic Rental
Per
Rentable Square Foot
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February
15, 2008 – February 29, 2008
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N/A
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$11,000.00
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$1.128
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March
1, 2008 – February 28, 2009
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$264,000.00
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$22,000.00
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$1.128
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March
1, 2009 – February 28, 2010
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$271,920.00
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$22,660.00
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$1.162
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March
1, 2010 – February 28, 2011
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$268,077.60
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$23,339.80
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$1.197
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D.
Base Year :
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Calendar
year 2008. In no event shall Tenant be responsible for any
Direct Costs pass throughs during the initial 12 months of the
Term.
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E.
Tenant's Proportionate Share :
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53.82%
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F.
Security Deposit :
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A
security deposit of $44,000.00 shall be paid by Tenant to
Landlord as follows: $22,000.00 concurrently with Tenant's
execution and delivery of this Lease to Landlord; an
additional $22,000.00 on January 1, 2008.
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G.
Permitted Use :
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General
office use as well as storage distribution and shipping of
pharmaceutical products .
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H.
Brokers :
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Told
Partners, Inc. (for Landlord)
Cresa
Partners (for Tenant)
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I.
Parking Passes :
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Tenant
shall have the right to use, free of charge during the initial
Term, up to four (4) unreserved parking passes for each 1,000
rentable square feet of office space
and up to two (2) unreserved parking passes for each 1,000
rentable square feet of warehouse
space contained in the Premises, which equals fifty (50)
unreserved parking passes, in the
aggregate. Tenant's parking passes shall be used by
Tenant in accordance with the terms provided in
Article 23 hereof.
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J.
Initial Installment of Basic Rental
:
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The
Basic Rental due and payable by Tenant for the period of
February 15, 2008 – February 29, 2008 in the amount of
$11,000.00 shall be paid by Tenant to Landlord on February 15,
2008.
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ARTICLE 2
TERM /PREMISES
The
Term of this Lease shall commence on the Commencement Date as
set forth in Article 1.A. of the Basic Lease Provisions
and shall end on the Expiration Date set forth in
Article 1.A. of the Basic Lease
Provisions. For purposes of this Lease, the term "
Lease Year " shall mean each consecutive
twelve (12) month period during the Lease Term, with the first
Lease Year commencing on the Commencement Date; however,
(a) if the Commencement Date falls on a day other than
the first day of a calendar month, the first Lease Year shall
end on the last day of the eleventh (11 th )
month after the Commencement Date and the second (2
nd ) and
each succeeding Lease Year shall commence on the first day of
the next calendar month, and (b) the last Lease Year
shall end on the Expiration Date. If Landlord does
not deliver possession of the Premises to Tenant on or before
the anticipated Commencement Date (as set forth in Article
1.A., above), Landlord shall not be subject to any liability
for its failure to do so, and such failure shall not affect
the validity of this Lease nor the obligations of Tenant
hereunder. Landlord and Tenant hereby stipulate
that the Premises contains the number of square feet specified
in Article 1.B. of the Basic Lease
Provisions. Landlord may deliver to Tenant a
Commencement Letter in a form substantially similar to that
attached hereto as Exhibit "C" , which Tenant
shall execute and return to Landlord within five (5) days of
receipt thereof. Failure of Tenant to timely
execute and deliver the Commencement Letter shall constitute
an acknowledgment by Tenant that the statements included in
such notice are true and correct, without
exception.
Tenant
and its employees, agents, contractors and subcontractors may
enter into the warehouse portion of the Premises as of January
1, 2008 and the office portion of the Premises as of January
15, 2008, upon receipt of Landlord's consent, solely for the
purpose of installing furniture, trade fixtures, telephones,
computers, photocopy equipment, and other business equipment.
Such early entry will not advance the Commencement Date so
long as Tenant does not commence business operations from any
part of the Premises. All of the provisions of this Lease
shall apply to Tenant during any early entry, including,
without limitation, the indemnities set forth in this Lease,
but excluding the obligation to pay Basic Rental only unless
and until Tenant has commenced business operations in the
Premises (or the Commencement Date has otherwise occurred),
whereupon Tenant's Basic Rental payment obligations shall
immediately commence. If Tenant is granted early
entry, Landlord shall not be responsible for any loss,
including theft, damage or destruction to any work or material
installed or stored by Tenant at the Premises or for any
injury to Tenant or its agents, employees, contractors,
subcontractors, subtenants, subtenants, assigns, licensees or
invitees. Landlord shall have the right to post appropriate
notices of non-responsibility and to require Tenant to provide
Landlord with evidence that Tenant has fulfilled its
obligation to provide insurance pursuant to the provisions of
this Lease.
Tenant
shall have the non-exclusive right to use in common with other
tenants in the Project a portion of the Project's lobby area
approved by Landlord as Tenant's reception area and, in
connection therewith, Tenant shall have the right to install
and operate a reception desk (approved by Landlord), subject
to Landlord's rules and regulations. In no event
shall Tenant be permitted to permanently affix its reception
desk to the lobby area. Upon the expiration or earlier
termination of this Lease, Tenant shall remove all of its
personal property from the Project's lobby area and
repair any damage to the Project caused thereby. Tenant's
failure to remove its personal property from the lobby area by
the Expiration Date of the Term shall constitute a holding
over under this Lease and the terms of Article 5 below shall
apply with respect thereto.
ARTICLE 3
RENTAL
(a)
Basic Rental . Tenant agrees to pay to
Landlord during the Term hereof, at Landlord's office or to
such other person or at such other place as directed from time
to time by written notice to Tenant from Landlord, the initial
monthly and annual sums as set forth in Article 1.C. of
the Basic Lease Provisions, payable in advance no later than
the first day of each calendar month, without demand, setoff
or deduction, and in the event this Lease commences or the
date of expiration of this Lease occurs other than on the
first day or last day of a calendar month, the rent for such
month shall be prorated. Notwithstanding the
foregoing, the Basic Rental for the period February 15, 2008
through February 29, 2008 shall be paid to Landlord in
accordance with Article 1.J. of the Basic Lease
Provisions.
(b)
Increase in Direct Costs . The term "
Base Year " means the calendar year set forth
in Article 1.D. of the Basic Lease
Provisions. If, in any calendar year during the
Term of this Lease, the "Direct Costs" (as hereinafter
defined) paid or incurred by Landlord shall be higher than the
Direct Costs for the Base Year, Tenant shall pay an additional
sum for each such subsequent calendar year equal to the
product of the amount set forth in Article 1.E. of the
Basic Lease Provisions multiplied by such increased amount of
Direct Costs. In the event either the Premises
and/or the Project is expanded or reduced, then Tenant's
Proportionate Share shall be appropriately adjusted, and as to
the calendar year in which such change occurs, Tenant's
Proportionate Share for such calendar year shall be determined
on the basis of the number of days during that particular
calendar year that such Tenant's Proportionate Share was in
effect. In the event this Lease shall terminate on
any date other than the last day of a calendar year, the
additional sum payable hereunder by Tenant during the calendar
year in which this Lease terminates shall be prorated on the
basis of the relationship which the number of days which have
elapsed from the commencement of said calendar year to and
including said date on which this Lease terminates bears to
three hundred sixty five (365). Any and all amounts due and
payable by Tenant pursuant to this Lease (other than Basic
Rental) shall be deemed " Additional Rent "
and Landlord shall be entitled to exercise the same rights and
remedies upon default in these payments as Landlord is
entitled to exercise with respect to defaults in monthly Basic
Rental payments.
(c)
Definitions . As used herein the term "
Direct Costs " shall mean the sum of the
following:
(i) "
Tax Costs ", which shall mean any and all
real estate taxes and other similar charges on real property
or improvements, assessments, water and sewer charges, and all
other charges assessed, reassessed or levied upon the Project
and appurtenances thereto and the parking or other facilities
thereof, or the real property thereunder (collectively, the "
Real Property ") or attributable thereto or
on the rents, issues, profits or income received or derived
therefrom which are assessed, reassessed or levied by the
United States, the State of California or any local government
authority or agency or any political subdivision thereof, and
shall include Landlord's reasonable legal fees, costs and
disbursements incurred in connection with proceedings for
reduction of Tax Costs or any part thereof; provided, however,
if at any time after the date of this Lease the methods of
taxation now prevailing shall be altered so that in lieu of or
as a supplement to or a substitute for the whole or any part
of any Tax Costs, there shall be assessed, reassessed or
levied (a) a tax, assessment, reassessment, levy,
imposition or charge wholly or partially as a net income,
capital or franchise levy or otherwise on the rents, issues,
profits or income derived therefrom, or (b) a tax,
assessment, reassessment, levy (including but not limited to
any municipal, state or federal levy), imposition or charge
measured by or based in whole or in part upon the Real
Property and imposed upon Landlord, then except to the extent
such items are payable by Tenant under Article 6 below, such
taxes, assessments, reassessments or levies or the part
thereof so measured or based, shall be deemed to be included
in the term "Direct Costs." In no event shall Tax
Costs included in Direct Costs for any year subsequent to the
Base Year be less than the amount of Tax Costs included in
Direct Costs for the Base Year. In addition, when
calculating Tax Costs for the Base Year, special assessments
shall only be deemed included in Tax Costs for the Base Year
to the extent that such special assessments are included in
Tax Costs for the applicable subsequent calendar year during
the Term.
(ii) "
Operating Costs ", which shall mean all costs
and expenses incurred by Landlord in connection with the
maintenance, operation, replacement, ownership and repair of
the Project, including, but not limited to, salaries, wages,
medical, and other taxes and benefits for all persons who
perform duties connected with the operation, maintenance and
repair of the Project; a reasonable allowance for depreciation
of the cost of acquiring or the rental expense of personal
property used in the maintenance, operation and repair of the
Project; accountant's fees, legal fees, real estate tax
consulting fees, personal property taxes on property used in
the maintenance and operation of the Project; fees, costs,
expenses or dues payable pursuant to the terms of any
covenants, conditions or restrictions or owners' association
pertaining to the Project; capital expenditures incurred to
effect economies of operation of, or stability of services to,
the Project and capital expenditures required by government
regulations, laws, or ordinances including, but not limited to
the American with Disabilities Act; costs incurred (capital or
otherwise) on a regular recurring basis every three (3) or
more years for certain maintenance projects (e.g., parking lot
slurry coat or replacement of lobby and elevator cab carpeting
the cost of all charges for electricity, gas, water and other
utilities furnished to the Project, including any taxes
thereon; charges for insurance for the Project carried by
Landlord; the cost of all building and cleaning supplies and
materials; the cost of all charges for cleaning, maintenance
and service contracts and other services with independent
contractors and administration fees; a property management fee
(which fee shall not exceed 5% of gross revenues at the
Project and may be imputed if Landlord has internalized
management or otherwise acts as its own property manager) and
license, permit and inspection fees relating to the
Project. In the event, during any calendar year,
the Project is less than ninety-five percent (95%) occupied at
all times, Operating Costs shall be adjusted to reflect the
Operating Costs of the Project as though ninety-five percent
(95%) were occupied at all times, and the increase or decrease
in the sums owed hereunder shall be based upon such Operating
Costs as so adjusted. In no event shall costs for any item of
utilities included in Direct Costs for any year subsequent to
the Base Year be less than the amount included in Direct Costs
for the Base Year for such utility item. Notwithstanding
anything to the contrary set forth in this Article 3,
when calculating Operating Costs for the Base Year, unless
Operating Costs for the applicable subsequent calendar year
include the applicable following items, Operating Costs shall
exclude (a) market-wide labor-rate increases due to
extraordinary circumstances including, but not limited to,
boycotts and strikes, (b) utility rate increases due to
extraordinary circumstances including, but not limited to,
conservation surcharges, boycotts, embargoes or other
shortages, and (c) amortization of any capital items
including, but not limited to, capital improvements, capital
repairs and capital replacements (including such amortized
costs where the actual improvement, repair or replacement was
made in prior years).
Additionally,
notwithstanding any contrary provision contained in this
Lease, in no event shall Tenant's Proportionate Share of
Direct Controllable Costs (as defined below) for any calendar
year exceed one hundred five percent (105%), calculated on a
cumulative and compounded basis, of Tenant's Proportionate
Share of Direct Controllable Costs for the immediately
preceding calendar year. "Direct Controllable
Costs" shall mean all Operating Costs, except for the
following: (A) the cost of all charges for
electricity, gas, water and other utilities furnished to the
Project, including any taxes thereon, (B) expenses incurred by
Landlord in connection with the Project for all labor,
including, but not limited to, salaries, wages, medical,
surgical and general welfare benefits and pension payments,
payroll taxes, fringe benefits, employment taxes, workers'
compensation, uniforms and dry cleaning thereof for all
persons who perform duties connected with the operation,
maintenance and repair of the Project, (C) the cost of all
charges for fire and extended coverage, liability and all
other insurance for the Project carried by Landlord, and (D)
costs incurred in connection with upgrading the Premises or
Project to comply with disability, life, seismic, fire and
safety codes, ordinances, statutes, or other
laws.
(d)
Determination of Payment .
(i) If
for any calendar year ending or commencing within the Term,
Tenant's Proportionate Share of Direct Costs for such calendar
year exceeds Tenant's Proportionate Share of Direct Costs for
the Base Year, then Tenant shall pay to Landlord, in the
manner set forth in Sections 3(d)(ii) and (iii), below,
and as Additional Rent, an amount equal to the excess (the "
Excess ").
(ii) Landlord
shall give Tenant a yearly expense estimate statement (the "
Estimate Statement ") which shall set forth
Landlord's reasonable estimate (the "
Estimate ") of what the total amount of
Direct Costs for the then-current calendar year shall be and
the estimated Excess (the " Estimated Excess
") as calculated by comparing Tenant's Proportionate Share of
Direct Costs for such calendar year, which shall be based upon
the Estimate, to Tenant's Proportionate Share of Direct Costs
for the Base Year. The failure of Landlord to
timely furnish the Estimate Statement for any calendar year
shall not preclude Landlord from subsequently enforcing its
rights to collect any Estimated Excess under this
Article 3, once such Estimated Excess has been determined
by Landlord. If pursuant to the Estimate Statement
an Estimated Excess is calculated for the then-current
calendar year, Tenant shall pay, with its next installment of
monthly Basic Rental due, a fraction of the Estimated Excess
for the then-current calendar year (reduced by any amounts
paid pursuant to the last sentence of this
Section 3(d)(ii)). Such fraction shall have as
its numerator the number of months which have elapsed in such
current calendar year to the month of such payment, both
months inclusive, and shall have twelve (12) as its
denominator. Until a new Estimate Statement is
furnished, Tenant shall pay monthly, with the monthly Basic
Rental installments, an amount equal to one-twelfth (1/12) of
the total Estimated Excess set forth in the previous Estimate
Statement delivered by Landlord to Tenant.
(iii) In
addition, Landlord shall endeavor to give to Tenant as soon as
reasonably practicable following the end of each calendar
year, a statement (the " Statement ") which
shall state the Direct Costs incurred or accrued for such
preceding calendar year, and which shall indicate the amount,
if any, of the Excess. Upon receipt of the
Statement for each calendar year during the Term, if amounts
paid by Tenant as Estimated Excess are less than the actual
Excess as specified on the Statement, Tenant shall pay, with
its next installment of monthly Basic Rental due, the full
amount of the Excess for such calendar year, less the amounts,
if any, paid during such calendar year as Estimated
Excess. If, however, the Statement indicates that
amounts paid by Tenant as Estimated Excess are greater than
the actual Excess as specified on the Statement, such
overpayment shall be credited against Tenant's next
installments of Estimated Excess. The failure of
Landlord to timely furnish the Statement for any calendar year
shall not prejudice Landlord from enforcing its rights under
this Article 3, once such Statement has been
delivered. Even though the Term has expired and
Tenant has vacated the Premises, when the final determination
is made of Tenant's Proportionate Share of the Direct Costs
for the calendar year in which this Lease terminates, if an
Excess is present, Tenant shall immediately pay to Landlord an
amount as calculated pursuant to the provisions of this
Article 3(d). The provisions of this
Section 3(d)(iii) shall survive the expiration or earlier
termination of the Term.
(iv) Within
one hundred twenty (120) days after receipt of a Statement by
Tenant (" Review Period "), if Tenant
disputes the amount set forth in the Statement, Tenant's
employees or an independent certified public accountant (which
accountant is a member of a nationally or regionally
recognized accounting firm and is hired on a non-contingency
fee basis), designated by Tenant, may, after reasonable notice
to Landlord and at reasonable times, inspect Landlord's
records at Landlord's offices, provided that Tenant is not
then in default after expiration of all applicable cure
periods of any obligation under this Lease (including, but not
limited to, the payment of the amount in dispute) and provided
further that Tenant and such accountant or representative
shall, and each of them shall use their commercially
reasonable efforts to cause their respective agents and
employees to, maintain all information contained in Landlord's
records in strict confidence. Notwithstanding the
foregoing, Tenant shall only have the right to review
Landlord's records one (1) time during any twelve (12) month
period. Tenant's failure to dispute the amounts set
forth in any Statement within the Review Period shall be
deemed to be Tenant's approval of such Statement and Tenant,
thereafter, waives the right or ability to dispute the amounts
set forth in such Statement. If after such
inspection, but within thirty (30) days after the Review
Period, Tenant notifies Landlord in writing that Tenant still
disputes such amounts, a certification as to the proper amount
shall be made in accordance with Landlord's standard
accounting practices, at Tenant's expense, by an independent
certified public accountant selected by Landlord and who is a
member of a nationally or regionally recognized accounting
firm, which certification shall be binding upon Landlord and
Tenant. Landlord shall cooperate in good faith with
Tenant and the accountant to show Tenant and the accountant
the information upon which the certification is to be
based. However, if such certification by the
accountant proves that the Direct Costs set forth in the
Statement were overstated by more than five percent (5%), then
the cost of the accountant and the cost of such certification
shall be paid for by Landlord. Promptly following
the parties receipt of such certification, the parties shall
make such appropriate payments or reimbursements, as the case
may be, to each other, as are determined to be owing pursuant
to such certification. Tenant agrees that this
section shall be the sole method to be used by Tenant to
dispute the amount of any Direct Costs payable by Tenant
pursuant to the terms of this Lease, and Tenant hereby waives
any other rights at law or in equity relating
thereto.
(v) If
the Project is a part of a multi-building development (the "
Development "), those Direct Costs
attributable to such development as a whole (and not
attributable solely to any individual building therein) shall
be allocated by Landlord to the Project and to the other
buildings within such development on an equitable
basis.
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(e)
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Tenant's Payment of Certain Tax Costs
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. In
the event that, after the Commencement Date, during the first
twelve (12) months of the initial Term only (and not any
extension or renewal of the initial Term), the Project is
reassessed (the " Reassessment ") for real
estate tax purposes by the appropriate governmental authority
pursuant to the terms of Proposition 13, then the terms of
this Section 3(e) shall apply to such Reassessment of the
Project.
(i)
The Tax Increase . For purposes of this
Section 3(e), the term " Tax Increase " shall
mean that portion of Tax Costs, as calculated immediately
following the Reassessment, which is attributable solely to
the Reassessment. Accordingly, the term "Tax
Increase" shall not include any portion of Tax Costs which
(A) is attributable to the initial assessment of the
value of the Real Property or the Project, the base, shell and
core of the Project or the tenant improvements located in the
Project, (B) is attributable to assessments which were
pending immediately prior to the Reassessment which
assessments were conducted during, and included in, such
Reassessment, or which assessments were otherwise rendered
unnecessary following the Reassessment, or (C) is
attributable to the annual inflationary increase of real
estate taxes (currently two percent (2.0%) per
annum).
(ii)
Protection . During the first twelve (12)
months of the initial Term only (and not any extension or
renewal thereof), Tenant shall not be obligated to pay any
portion of the Tax Increase.
(iii)
Landlord's Right to Purchase the Proposition 13
Protection Amount . The amount of Tax Costs
which Tenant is not obligated to pay or will not be obligated
to pay during the Term in connection with a Reassessment
pursuant to the terms of this Section 3(e) shall be
sometimes referred to hereafter as a "Proposition 13
Protection Amount". If the occurrence of a
Reassessment is reasonably foreseeable by Landlord and the
Proposition 13 Protection Amount attributable to such
Reassessment can be reasonably quantified or estimated for
each calendar year commencing with the year in which the
Reassessment will occur, the terms of this
Section 3(e)(iii) shall apply to each such
Reassessment. Upon notice to Tenant, Landlord shall
have the right (but not the obligation) to purchase the
Proposition 13 Protection Amount relating to the
Reassessment, at any time during the Term, by paying to Tenant
an amount equal to the "Proposition 13 Purchase Price",
as that term is defined below. As used herein, "
Proposition 13 Purchase Price " shall
mean the present value of the Proposition 13 Protection
Amount remaining during the Term, as of the date of payment of
the Proposition 13 Purchase Price by
Landlord. Such present value shall be calculated
(i) by using the portion of the Proposition 13
Protection Amount attributable to each remaining year of the
Term (as though the portion of such Proposition 13
Protection Amount benefited Tenant at the end of each Lease
Year), as the amounts to be discounted, and (ii) by using
discount rates for each amount to be discounted equal to (A)
the average rates of yield for United States Treasury
Obligations with maturity dates as close as reasonably
possible to the end of each Lease Year during which the
portions of the Proposition 13 Protection Amount would have
benefited Tenant, which rates shall be those in effect as of
Landlord’s exercise of its right to purchase as set
forth in this subsection (iii), plus (B) two percent (2%) per
annum. Upon such payment of the Proposition 13
Purchase Price, the provisions of Section 3(e)(ii) of
this Lease shall not apply to any Tax Increase attributable to
the Applicable Reassessment and Tenant shall have no further
protection whatsoever under this Section
3(e). Since Landlord will be estimating the
Proposition 13 Purchase Price because a Reassessment has
not yet occurred, then when such Reassessment occurs, if
Landlord has underestimated the Proposition 13 Purchase
Price, Tenant's Basic Rental next due shall be credited with
the amount of such underestimation, and if Landlord
overestimates the Proposition 13 Purchase Price, then
Tenant shall pay the amount of the overestimation to Landlord
within thirty (30) days after demand.
ARTICLE 4
SECURITY DEPOSIT
Tenant
shall deposit with Landlord the sum set forth in
Article 1.F. of the Basic Lease Provisions as security
for the full and faithful performance of every provision of
this Lease to be performed by Tenant in accordance with the
terms of such Article 1.F. If Tenant breaches any
provision of this Lease, including but not limited to the
payment of rent, Landlord may use all or any part of this
security deposit for the payment of any rent or any other sums
in 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 five (5) days after written
demand therefor, deposit cash with Landlord in an amount
sufficient to restore the security deposit to its full
amount. Tenant agrees that Landlord shall not be
required to keep the security deposit in trust, segregate it
or keep it separate from Landlord's general funds, but
Landlord may commingle the security deposit with its general
funds and Tenant shall not be entitled to interest on such
deposit. At the expiration of the Lease Term, and
provided there exists no default by Tenant hereunder, the
security deposit or any balance thereof shall be returned to
Tenant (or, at Landlord's option, to Tenant's "Transferee," as
such term is defined in Article 15 below), provided that
subsequent to the expiration of this Lease, Landlord may
retain from said security deposit (i) an amount
reasonably estimated by Landlord to cover potential Direct
Cost reconciliation payments due with respect to the calendar
year in which this Lease terminates or expires (such amount so
retained shall not, in any event, exceed ten percent (10%) of
estimated Direct Cost payments due from Tenant for such
calendar year through the date of expiration or earlier
termination of this Lease and any amounts so retained and not
applied to such reconciliation shall be returned to Tenant
within thirty (30) days after Landlord's delivery of the
Statement for such calendar year), (ii) any and all
amounts reasonably estimated by Landlord to cover the
anticipated costs to be incurred by Landlord to remove any
signage provided to Tenant under this Lease, to remove cabling
and other items required to be removed by Tenant under Article
29(b) below and to repair any damage caused by such removal
(in which case any excess amount so retained by Landlord shall
be returned to Tenant within thirty (30) days after such
removal and repair), and (iii) any and all amounts
permitted by law or this Article 4. Tenant hereby
waives the provisions of Section 1950.7 of the California
Civil Code and all other provisions of law, now or hereafter
in effect, which provide that Landlord may claim from a
security deposit only those sums reasonably necessary to
remedy defaults in the payment of rent, to repair damage
caused by Tenant or to clean the Premises, it being agreed
that Landlord may, in addition, claim those sums specified in
this Article 4 above and/or those sums reasonably necessary to
compensate Landlord for any other loss or damage, foreseeable
or unforeseeable, caused by the acts or omissions of Tenant or
any officer, employee, agent, contractor or invitee of
Tenant.
ARTICLE 5
HOLDING OVER
Should
Tenant, without Landlord's written consent, hold over after
termination of this Lease, Tenant shall become a tenant at
sufferance upon each and all of the terms herein provided as
may be applicable to such a tenancy and any such holding over
shall not constitute an extension of this
Lease. During such holding over, Tenant shall pay
in advance, monthly, Basic Rental at a rate equal to one
hundred fifty percent (150%) of the rate in effect for the
last month of the Term of this Lease, in addition to, and not
in lieu of, all other payments required to be made by Tenant
hereunder including but not limited to Tenant's Proportionate
Share of any increase in Direct Costs. Nothing
contained in this Article 5 shall be construed as consent
by Landlord to any holding over of the Premises by Tenant, and
Landlord expressly reserves the right to require Tenant to
surrender possession of the Premises to Landlord as provided
in this Lease upon the expiration or earlier termination of
the Term. If Tenant fails to surrender the Premises
upon the expiration or termination of this Lease, Tenant
agrees to indemnify, defend and hold Landlord harmless from
all costs, loss, expense or liability, including without
limitation, claims made by any succeeding tenant and real
estate brokers claims and attorney's fees and
costs.
ARTICLE 6
OTHER TAXES
Tenant
shall pay, prior to delinquency, all taxes assessed against or
levied upon trade fixtures, furnishings, equipment and all
other personal property of Tenant located in the
Premises. In the event any or all of Tenant's trade
fixtures, furnishings, equipment and other personal property
shall be assessed and taxed with property of Landlord, or if
the cost or value of any leasehold improvements in the
Premises exceeds the cost or value of a Project-standard
buildout as determined by Landlord and, as a result, real
property taxes for the Project are increased, Tenant shall pay
to Landlord, within ten (10) days after delivery to Tenant by
Landlord of a written statement setting forth such amount, the
amount of such taxes applicable to Tenant's property or
above-standard improvements. Tenant shall assume
and pay to Landlord at the time Basic Rental next becomes due
(or if assessed after the expiration of the Term, then within
ten (10) days), any excise, sales, use, rent, occupancy,
garage, parking, gross receipts or other taxes (other than net
income taxes) which may be assessed against or levied upon
Landlord on account of the letting of the Premises or the
payment of Basic Rental or any other sums due or payable
hereunder, and which Landlord may be required to pay or
collect under any law now in effect or hereafter
enacted. In addition to Tenant’s obligation
pursuant to the immediately preceding sentence, Tenant shall
pay directly to the party or entity entitled thereto all
business license fees, gross receipts taxes and similar taxes
and impositions which may from time to time be assessed
against or levied upon Tenant, as and when the same become due
and before delinquency. Notwithstanding anything to
the contrary contained herein, any sums payable by Tenant
under this Article 6 shall not be included in the
computation of "Tax Costs."
ARTICLE 7
USE
Tenant
shall use and occupy the Premises only for the use set forth
in Article 1.G. of the Basic Lease Provisions and shall
not use or occupy the Premises or permit the same to be used
or occupied for any other purpose without the prior written
consent of Landlord, which consent may be given or withheld in
Landlord's sole and absolute discretion, and Tenant agrees
that it will use the Premises in such a manner so as not to
interfere with or infringe upon the rights of other tenants or
occupants in the Project. Tenant shall, at its sole
cost and expense, promptly comply with all laws, statutes,
ordinances, governmental regulations or requirements now in
force or which may hereafter be in force relating to or
affecting (i) the condition, use or occupancy of the
Premises or the Project (excluding structural changes to the
Project not related to Tenant's particular use of the
Premises), and (ii) improvements installed or constructed
in the Premises by or for the benefit of
Tenant. Tenant shall not place a load upon the
floor of the Premises which exceeds the load per square foot
which such floor was designed to carry and which is allowed by
law. Tenant shall not do or permit to be done
anything which would invalidate or increase the cost of any
fire and extended coverage insurance policy covering the
Project and/or the property located therein and Tenant shall
comply with all rules, orders, regulations and requirements of
any organization which sets out standards, requirements or
recommendations commonly referred to by major fire insurance
underwriters, and Tenant shall promptly upon demand reimburse
Landlord for any additional premium charges for any such
insurance policy assessed or increased by reason of Tenant's
failure to comply with the provisions of this
Article.
ARTICLE 8
CONDITION OF PREMISES
Tenant
hereby agrees that the Premises shall be taken "as is", "with
all faults", "without any representations or warranties", and
Tenant hereby agrees and warrants that it has investigated and
inspected the condition of the Premises and the suitability of
same for Tenant's purposes, and Tenant does hereby waive and
disclaim any objection to, cause of action based upon, or
claim that its obligations hereunder should be reduced or
limited because of the condition of the Premises or the
Project or the suitability of same for Tenant's
purposes. Tenant acknowledges that neither Landlord
nor any agent nor any employee of Landlord has made any
representations or warranty with respect to the Premises or
the Project or with respect to the suitability of either for
the conduct of Tenant's business and Tenant expressly warrants
and represents that Tenant has relied solely on its own
investigation and inspection of the Premises and the Project
in its decision to enter into this Lease and let the Premises
in the above-described condition. The Premises
shall be initially improved as provided in, and subject to,
the terms and conditions of the immediately following
paragraph. The existing leasehold improvements in
the Premises as of the date of this Lease, together with the
Improvements (as defined below) may be collectively referred
to herein as the " Tenant Improvements
." The taking of possession of the Premises by
Tenant shall conclusively establish that the Premises and the
Project were at such time in satisfactory
condition. Tenant hereby waives subsection 1 of
Section 1932 and Sections 1941 and 1942 of the Civil Code of
California or any successor provision of law.
Notwithstanding
the foregoing, Landlord agrees to deliver the Premises to
Tenant with the electrical outlets, plumbing and HVAC system
serving the Premises in good working order and
condition.
ARTICLE 9
REPAIRS AND ALTERATIONS
(a)
Landlord's Obligation .
Landlord shall maintain the structural portions of the
Project, including the foundation, floor/ceiling slabs, roof,
curtain wall, exterior glass, columns, beams, shafts, stairs,
stairwells, elevator cabs and common areas, and shall also
maintain and repair the base building mechanical, electrical,
life safety, plumbing, sprinkler systems and heating,
ventilating and air-conditioning systems.
(b)
Tenant's Obligation . Except as
expressly provided as Landlord's obligation in this
Article 9, Tenant shall keep the Premises in good
condition and repair. All damage or injury to the
Premises or the Project resulting from the act or negligence
of Tenant, its employees, agents or visitors, guests, invitees
or licensees, or by the use of the Premises, shall be promptly
repaired by Tenant at its sole cost and expense, to the
satisfaction of Landlord; provided, however, that for damage
to the Project as a result of casualty or for any repairs that
may impact the mechanical, electrical, plumbing, heating,
ventilation or air-conditioning systems of the Project,
Landlord shall have the right (but not the obligation) to
select the contractor and oversee all such
repairs. Landlord may make any repairs which are
not promptly made by Tenant after Tenant's receipt of written
notice and the reasonable opportunity of Tenant to make said
repair within five (5) business days from receipt of said
written notice, and charge Tenant for the cost thereof, which
cost shall be paid by Tenant within five (5) days from invoice
from Landlord. Tenant shall be responsible for the
design and function of all non-standard improvements of the
Premises, whether or not installed by Landlord at Tenant's
request. Tenant waives all rights to make repairs
at the expense of Landlord, or to deduct the cost thereof from
the rent.
(c)
Alterations . Tenant shall make
no alterations, installations, changes or additions in or to
the Premises or the Project (collectively, "
Alterations ") without Landlord's prior
written consent, not to be unreasonably withheld or delayed,
except that Landlord's consent may be withheld in its sole and
absolute discretion with respect to Alterations that may
affect the Project structure, systems, equipment and/or
exterior. Notwithstanding the foregoing, Tenant may
make strictly cosmetic changes to the finish work in the
Premises, not including any changes affecting the Project
structure, appearance, or systems and equipment, without
Landlord's consent, provided that the aggregate cost of any
such changes does not exceed Ten Thousand Dollars ($10,000.00)
in any twelve (12) month period, and such changes do not
require any substantial modifications to the
Premises. Tenant shall give Landlord at least ten
(10) days prior notice of such cosmetic Alterations, which
notice shall be accompanied by reasonably adequate evidence
that such changes meet the criteria contained in this Article
9. Any Alterations approved by Landlord must be
performed in accordance with the terms hereof, using only
contractors or mechanics approved by Landlord in writing and
upon the approval by Landlord in writing of fully detailed and
dimensioned plans and specifications pertaining to the
Alterations in question, to be prepared and submitted by
Tenant at its sole cost and expense. Tenant shall
at its sole cost and expense obtain all necessary approvals
and permits pertaining to any Alterations approved by
Landlord. Tenant shall cause all Alterations to be
performed in a good and workmanlike manner, in conformance
with all applicable federal, state, county and municipal laws,
rules and regulations, pursuant to a valid building permit,
and in conformance with Landlord's construction rules and
regulations. If Landlord, in approving any
Alterations, specifies a commencement date therefor, Tenant
shall not commence any work with respect to such Alterations
prior to such date. Tenant hereby agrees to
indemnify, defend, and hold Landlord free and
harmless from all liens and claims of lien, and all other
liability, claims and demands arising out of any work done or
material supplied to the Premises by or at the request of
Tenant in connection with any Alterations.
(d)
Insurance; Liens . Prior to the commencement
of any Alterations, Tenant shall provide Landlord with
evidence that Tenant carries "Builder's All Risk" insurance in
an amount approved by Landlord covering the construction of
such Alterations, and such other insurance as Landlord may
reasonably require, it being understood that all such
Alterations shall be insured by Tenant pursuant to
Article 14 of this Lease immediately upon completion
thereof. In addition, Landlord may, in its
discretion, require Tenant to obtain a lien and completion
bond or some alternate form of security satisfactory to
Landlord in an amount sufficient to ensure the lien free
completion of such Alterations and naming Landlord as a
co-obligee.
(e)
Costs and Fees; Removal . If permitted
Alterations are made, they shall be made at Tenant's sole cost
and expense and shall be and become the property of Landlord,
except that Landlord may, by written notice to Tenant given
prior to the end of the Term, require Tenant at Tenant's
expense to remove all partitions, counters, railings, cabling
and other Alterations installed by Tenant, and to repair any
damage to the Premises and the Project caused by such
removal. Any and all costs attributable to or
related to the applicable building codes of the city in which
the Project is located (or any other authority having
jurisdiction over the Project) arising from Tenant's plans,
specifications, improvements, Alterations or otherwise shall
be paid by Tenant at its sole cost and expense.
Notwithstanding any contrary provision contained in this
Lease, provided that Tenant repairs any damage caused by such
removal, at Tenant's sole cost and expense, Tenant shall have
the right to remove Tenant's personal property, fixtures and
equipment from the Premises upon the expiration or earlier
termination of this Lease, even if such items are affixed to
the Premises. The construction of initial
improvements to the Premises shall be governed by the terms of
the Tenant Work Letter and not the terms of this
Article 9.
(f)
Security System . Landlord hereby grants
Tenant the right, at Tenant's cost and expense, install a
security system in the Premises (" Tenant's Security
System ") which serves the Premises only; provided,
however, if Tenant's Security System ties into the Project's
security system, Tenant shall coordinate the installation and
operation of Tenant's Security System with Landlord to assure
that Tenant's Security System is compatible with the Project's
security system and the other systems and equipment of the
Project. Tenant may install any security system
selected by Tenant provided that such Tenant's Security System
(i) does not create an adverse effect on the structural
integrity of the Project, (ii) is in compliance with
applicable governmental laws, rules, and regulations, (iii)
does not create an adverse effect on the Project's systems or
equipment, (iv) does not unreasonably interfere with the
normal and customary office operations of any other tenant of
the Project or (v) does not adversely effect Landlord's
ability to operate the Project including the security system
of the Project. If any of the conditions set forth
in items (i) through (v), above, are not satisfied, then
Tenant shall not be permitted to install or operate Tenant's
Security System. Tenant shall be solely
responsible, at Tenant's sole cost and expense, for the
installation, monitoring, operation and removal of Tenant's
Security System. Tenant shall provide Landlord with
any information reasonably required regarding Tenant's
Security System so that, except for any portion of the
Premises with restricted access as required by applicable
governmental laws, rules or regulations (including, without
limitation, any vault located within the Premises), the
Project janitorial staff may enter the Premises for the
purpose of cleaning the Premises and so that Landlord may have
access to the Premises in the event of an
emergency. Tenant shall, at Tenant's sole cost and
expense, remove Tenant's Security System upon the expiration
or earlier termination of this Lease and repair any damage
resulting from such removal.
(g)
Secured Area . Notwithstanding any contrary
provision contained in this Lease, Tenant shall be entitled,
during the Term, to designate a reasonable portion of the
Premises as a "Secured Area" and to install door locks or
other access control systems as necessary to secure such
Secured Area, provided that Tenant gives Landlord prior
written notice of Tenant's designation of such Secured Area
and that such Secured Area shall be used by Tenant solely for
the purpose of securing certain valuable property or
confidential information. Tenant hereby agrees and
acknowledges that Landlord shall have no obligation to perform
janitorial services in such Secured Area unless Tenant
provides Landlord a written request for same and provides
Landlord with access to such Secured Area (by providing
Landlord a key or other device, by scheduling Landlord's entry
with an escort or otherwise at times designated by
Landlord). Landlord shall have the right to use
reasonable force to gain access to such Secured Area in the
case of emergency and Landlord shall have no liability
whatsoever to Tenant in connection
therewith. Landlord and Tenant hereby agree and
acknowledge that, except as provided in the immediately
preceding sentence, Landlord shall enter such Secured Area
only upon one (1) business days' prior notice to Tenant and
only after providing Tenant with the opportunity to have a
representative of Tenant present as an
escort. Landlord and Tenant hereby agree to use
commercially reasonable efforts to schedule any such entries
into the Secured Area by Landlord at times that are mutually
convenient to both Landlord and Tenant, taking into
consideration the nature of Tenant's operations in the
Premises. Tenant agrees that Tenant shall be
responsible, at its sole cost and expense, for complying with
all applicable laws regarding such Secured Area and that such
Secured Area is subject to the indemnification provisions of
Article 13 below.
ARTICLE 10
LIENS
Tenant
shall keep the Premises and the Project free from any
mechanics' liens, vendors liens or any other liens arising out
of any work performed, materials furnished or obligations
incurred by Tenant, and Tenant agrees to defend, indemnify and
hold Landlord harmless from and against any such lien or claim
or action thereon, together with costs of suit and reasonable
attorneys' fees and costs incurred by Landlord in connection
with any such claim or action. Before commencing
any work of alteration, addition or improvement to the
Premises, Tenant shall give Landlord at least ten (10)
business days' written notice of the proposed commencement of
such work (to afford Landlord an opportunity to post
appropriate notices of non-responsibility). In the
event that there shall be recorded against the Premises or the
Project or the property of which the Premises is a part any
claim or lien arising out of any such work performed,
materials furnished or obligations incurred by Tenant and such
claim or lien shall not be removed or discharged within ten
(10) days of filing, Landlord shall have the right but not the
obligation to pay and discharge said lien without regard to
whether such lien shall be lawful or correct, or to require
that Tenant promptly deposit with Landlord in cash, lawful
money of the United States, one hundred fifty percent (150%)
of the amount of such claim, which sum may be retained by
Landlord until such claim shall have been removed of record or
until judgment shall have been rendered on such claim and such
judgment shall have become final, at which time Landlord shall
have the right to apply such deposit in discharge of the
judgment on said claim and any costs, including attorneys'
fees and costs incurred by Landlord, and shall remit the
balance thereof to Tenant.
ARTICLE 11
PROJECT SERVICES
(a)
Basic Services . Landlord
agrees to furnish to the Premises, at a cost to be included in
Operating Costs, from 8:00 a.m. to 6:00 p.m. Mondays
through Fridays and 9:00 a.m. to 1:00 p.m. on Saturdays,
excepting local and national holidays, air conditioning and
heat all in such reasonable quantities as in the judgment of
Landlord is reasonably necessary for the comfortable occupancy
of the Premises. In addition, Landlord shall
provide electric current for normal lighting and normal office
machines, elevator service and water on the same floor as the
Premises for lavatory and drinking purposes in such reasonable
quantities as in the judgment of Landlord is reasonably
necessary for general office use and in compliance with
applicable codes. Janitorial and maintenance
services shall be furnished five (5) days per week, excepting
local and national holidays. Tenant shall comply
with all rules and regulations which Landlord may establish
for the proper functioning and protection of the common area
air conditioning, heating, elevator, electrical, intrabuilding
cabling and wiring and plumbing systems. Landlord
shall not be liable for, and there shall be no rent abatement
as a result of, any stoppage, reduction or interruption of any
such services caused by governmental rules, regulations or
ordinances, riot, strike, labor disputes, breakdowns,
accidents, necessary repairs or other cause. Except
as specifically provided in this Article 11, Tenant
agrees to pay for all utilities and other services utilized by
Tenant and any additional building services furnished to
Tenant which are not uniformly furnished to all tenants of the
Project, at the rate generally charged by Landlord to tenants
of the Project for such utilities or services.
(b)
Excess Usage . Tenant will not,
without the prior written consent of Landlord, use any
apparatus or device in the Premises which will in any way
increase the amount of electricity or water usually furnished
or supplied for use of the Premises as general office space;
nor connect any apparatus, machine or device with water pipes
or electric current (except through existing electrical
outlets in the Premises), for the purpose of using electric
current or water.
(c)
Additional Electrical Service .
If Tenant shall require electric current in excess of that
which Landlord is obligated to furnish under
Article 11(a) above, Tenant shall first obtain the
written consent of Landlord, which Landlord may refuse in its
sole and absolute discretion. Additionally,
Landlord may cause an electric current meter or submeter to be
installed in or about the Premises to measure the amount of
any such excess electric current consumed by Tenant in the
Premises. The cost of any such meter and of
installation, maintenance and repair thereof shall be paid for
by Tenant and Tenant agrees to pay to Landlord, promptly upon
demand therefor by Landlord, for all such excess electric
current consumed by any such use as shown by said meter at the
rates charged for such service by the city in which the
Project is located or the local public utility, as the case
may be, furnishing the same, plus any additional expense
incurred by Landlord in keeping account of the electric
current so consumed.
(d)
HVAC Balance . If any lights,
machines or equipment (including but not limited to computers
and computer systems and appurtenances) are used by Tenant in
the Premises which materially affect the temperature otherwise
maintained by the air conditioning system, or generate
substantially more heat in the Premises than would be
generated by the building standard lights and usual office
equipment, Landlord shall have the right to install any
machinery and equipment which Landlord reasonably deems
necessary to restore temperature balance, including but not
limited to modifications to the standard air conditioning
equipment, and the cost thereof, including the cost of
installation and any additional cost of operation and
maintenance occasioned thereby, shall be paid by Tenant to
Landlord upon demand by Landlord.
(e)
Telecommunications . Upon
request from Tenant from time to time, Landlord will provide
Tenant with a listing of telecommunications and media service
providers serving the Project, and Tenant shall have the right
to contract directly with the providers of its
choice. If Tenant wishes to contract with or obtain
service from any provider which does not currently serve the
Project or wishes to obtain from an existing carrier services
which will require the installation of additional equipment,
such provider must, prior to providing service, enter into a
written agreement with Landlord setting forth the terms and
conditions of the access to be granted to such
provider. In considering the installation of any
new or additional telecommunications cabling or equipment at
the Project, Landlord will consider all relevant factors in a
reasonable and non-discriminatory manner, including, without
limitation, the existing availability of services at the
Project, the impact of the proposed installations upon the
Project and its operations and the available space and
capacity for the proposed installations. Landlord
may also consider whether the proposed service may result in
interference with or interruption of other services at the
Project or the business operations of other tenants or
occupants of the Project. In no event shall
Landlord be obligated to incur any costs or liabilities in
connection with the installation or delivery of
telecommunication services or facilities at the
Project. All such installations shall be subject to
Landlord's prior approval, which shall not be unreasonably
withheld, and shall be performed in accordance with the terms
of Article 9. If Landlord approves the proposed
installations in accordance with the foregoing, Landlord will
deliver its standard form agreement upon request and will use
commercially reasonable efforts to promptly enter into an
agreement on reasonable and non-discriminatory terms with a
qualified, licensed and reputable carrier confirming the terms
of installation and operation of telecommunications equipment
consistent with the foregoing.
(f)
After-Hours Use . If Tenant
requires heating, ventilation and/or air conditioning during
times other than the times provided in Article 11(a)
above, Tenant shall give Landlord such advance notice as
Landlord shall reasonably require and shall pay Landlord's
standard charge for such after-hours use.
(g)
Reasonable Charges . Landlord
may impose a reasonable charge for any utilities or services
(other than electric current and heating, ventilation and/or
air conditioning which shall be governed by
Articles 11(c) and (f) above) utilized by Tenant in
excess of the amount or type that Landlord reasonably
determines is typical for general office use.
(h)
Sole Electrical Representative .
Tenant agrees that Landlord shall be
the sole and exclusive representative with respect to, and
shall maintain exclusive control over, the reception,
utilization and distribution of electrical power, regardless
of point or means of origin, use or
generation. Tenant shall not have the right to
contract directly with any provider of electrical power or
services.
(i)
Supplemental Power . In the event that
Tenant desires, at any time, to install any supplemental power
supply at the Project (“ Supplemental Power
Equipment ”), Landlord shall have the right, in
its sole and absolute discretion, (i) to grant or
withhold its consent to the installation of such Supplemental
Power Equipment, and (ii) to designate a
Landlord-affiliated entity to perform all work relating to the
design and installation of such Supplemental Power
Equipment.
ARTICLE 12
RIGHTS OF LANDLORD
(a)
Right of Entry . Except to the
extent expressly set forth to the contrary in Section 9(g)
above, Landlord and its agents shall have the right to enter
the Premises at all reasonable times, for the purpose of
cleaning the Premises, examining or inspecting the same,
serving or posting and keeping posted thereon notices as
provided by law, or which Landlord deems necessary for the
protection of Landlord or the Project, showing the same to
prospective tenants, lenders or purchasers of the Project, in
the case of an emergency, and for making such alterations,
repairs, improvements or additions to the Premises or to the
Project as Landlord may deem necessary or
desirable. If Tenant shall not be personally
present to open and permit an entry into the Premises at any
time when such an entry by Landlord is necessary or permitted
hereunder, Landlord may enter by means of a master key, or may
forcibly enter in the case of an emergency, in each event
without liability to Tenant and without affecting this
Lease.
(b)
Maintenance Work . Landlord
reserves the right from time to time, but subject to payment
by and/or reimbursement from Tenant as otherwise provided
herein: (i) to install, use, maintain, repair, replace,
relocate and control for service to the Premises and/or other
parts of the Project pipes, ducts, conduits, wires, cabling,
appurtenant fixtures, equipment spaces and mechanical systems,
wherever located in the Premises or the Project, (ii) to
alter, close or relocate any facility in the Premises or the
common areas or otherwise conduct any of the above activities
for the purpose of complying with a general plan for fire/life
safety for the Project or otherwise, and (iii) to comply
with any federal, state or local law, rule or
order. Landlord shall attempt to perform any such
work with the least inconvenience to Tenant as is reasonably
practicable, but in no event shall Tenant be permitted to
withhold or reduce Basic Rental or other charges due hereunder
as a result of same, make any claim for constructive eviction
or otherwise make any claim against Landlord for interruption
or interference with Tenant's business and/or
operations.
(c)
Rooftop . If Tenant desires to
use the rooftop of the Project for any purpose, including the
installation of communication equipment to be used from the
Premises, such rights will be granted in Landlord's sole
discretion and Tenant must negotiate the terms of any rooftop
access with Landlord or the rooftop management company or
lessee holding rights to the rooftop from time to
time. Any rooftop access granted to Tenant will be
at prevailing rates and will be governed by the terms of a
separate written agreement or an amendment to this
Lease.
ARTICLE 13
INDEMNITY; EXEMPTION OF LANDLORD FROM
LIABILITY
(a)
Indemnity . Tenant shall indemnify, defend
and hold Landlord, its subsidiaries, partners, affiliates and
their respective officers, directors, employees and
contractors (collectively, " Landlord Parties
") harmless from any and all loss, cost, damage, expense and
liability (including, without limitation, court costs and
reasonable attorneys’ fees) incurred in connection with
or arising from any cause in, on or about the Premises
(including, but not limited to, a slip and fall), Tenant's use
of the Premises or the Project or from the conduct of
Tenant’s business or from any breach or default in the
performance of any obligation on Tenant's part to be performed
under this Lease or arising from any acts, omissions,
negligence or willful misconduct of Tenant or any of its
agents, contractors, employees or invitees, patrons, customers
or members in or about the Project. Tenant hereby
assumes all risk of damage to property or injury to persons
in, upon or about the Premises from any cause (including,
without limitation, any injury resulting from a slip and fall
in, upon or about the Premises), and Tenant hereby waives all
claims in respect thereof against Landlord and the Landlord
Parties, excepting where the damage is caused solely by the
negligence or willful misconduct of Landlord or the Landlord
Parties.
(b)
Exemption of Landlord from Liability
. Landlord and the Landlord Parties shall not be
liable for injury to Tenant's business, or loss of income
therefrom, however occurring (including, without limitation,
from any failure or interruption of services or
utilities). Further, Landlord and the Landlord
Parties shall not be liable for damage or injury that may be
sustained in, upon or about the Premises by Tenant, its
employees, invitees, customers, agents, or contractors, or any
other person, except to the extent such damage or injury
results from the negligence or willful misconduct of Landlord
or the Landlord Parties. Landlord and the Landlord
Parties shall not be liable to Tenant for any damages arising
from any willful or negligent action or inaction of any other
tenant of the Project.
(c)
Security. Tenant acknowledges
that Landlord's election whether or not to provide any type of
mechanical surveillance or security personnel whatsoever in
the Project is solely within Landlord's discretion; Landlord
and the Landlord Parties shall have no liability in connection
with the provision, or lack, of such services, and Tenant
hereby agrees to hold Landlord and the Landlord Parties
harmless with regard to any such potential
claim. Landlord and the Landlord Parties shall not
be liable for losses due to theft, vandalism, or like
causes. Tenant shall defend, indemnify, and hold
Landlord and the Landlord Parties harmless from any such
claims made by any employee, licensee, invitee, contractor,
agent or other person whose presence in, on or about the
Premises or the Project is attendant to the business of
Tenant.
ARTICLE 14
INSURANCE
(a)
Tenant's Insurance . Tenant, shall at all
times during the Term of this Lease, and at its own cost and
expense, procure and continue in force the following insurance
coverage: (i) Commercial General Liability
Insurance, written on an occurrence basis, with a combined
single limit for bodily injury and property damages of not
less than Two Million Dollars ($2,000,000) per occurrence and
Three Million Dollars ($3,000,000) in the annual aggregate,
including products liability coverage if applicable, owners
and contractors protective coverage if applicable, blanket
contractual coverage including both oral and written
contracts, and personal injury coverage, covering the insuring
provisions of this Lease and the performance of Tenant of the
indemnity and exemption of Landlord from liability agreements
set forth in Article 13 hereof; (ii) a policy of
standard fire written on special form, (all risks),
including a vandalism and malicious mischief, sprinkler
leakage coverage and earthquake sprinkler leakage where
sprinklers are provided in an amount equal to the full
replacement value new without deduction for depreciation of
all (A) Tenant Improvements, Alterations, fixtures and
other improvements in the Premises, including but not limited
to all mechanical, plumbing, heating, ventilating, air
conditioning, electrical, telecommunication and other
equipment, systems and facilities, and (B) trade
fixtures, furniture, equipment and other personal property
installed by or at the expense of Tenant; (iii) Worker's
Compensation coverage as required by law; and
(iv) business interruption, loss of income and extra
expense insurance covering any failure or interruption of
Tenant's business equipment (including, without limitation,
telecommunications equipment) covering all other
perils, failures or interruptions sufficient to cover a period
of interruption of not less than twelve (12)
months.
(b)
Form of Policies . The aforementioned
minimum limits of policies and Tenant's procurement and
maintenance thereof shall in no event limit the liability of
Tenant hereunder. The Commercial General Liability
Insurance policy shall name the Landlord Parties, Landlord's
lender(s) and such other persons or firms as Landlord
specifies from time to time, as additional insured’s.
All such insurance policies carried by Tenant shall be with
companies having a rating of not less than A-VIII in Best's
Insurance Guide. Tenant shall furnish to Landlord,
from the insurance companies, or cause the insurance companies
to furnish, certificates of coverage. The
deductible under each such policy shall in no event exceed
$5,000.00. No such policy shall be cancelable
except after thirty (30) days prior written notice or ten (10)
days of non-payment of premiums to Landlord by the
insurer. All such policies shall be endorsed to
agree that Tenant's policy is primary and that any insurance
carried by Landlord is excess and not contributing with any
Tenant insurance requirement hereunder. Tenant
shall, furnish Landlord with renewals or binders upon issuance
of renewal. Tenant agrees that if Tenant does not
take out and maintain such insurance or furnish Landlord with
renewals or binders in a timely manner, Landlord may (but
shall not be required to) procure said insurance on Tenant's
behalf and charge Tenant the cost thereof, which amount shall
be payable by Tenant upon demand with interest (at the rate
set forth in Section 20(e) below) from the date such sums
are extended. Tenant shall have the right to
provide such insurance coverage pursuant to blanket policies
obtained by Tenant, provided such blanket policies expressly
afford coverage to the Premises and to Tenant as required by
this Lease.
(c)
Landlord's Insurance . Landlord may, as a
cost to be included in Operating Costs, procure and maintain
at all times during the Term of this Lease, a policy or
policies of insurance covering loss or damage to the Project
in the amount of the full replacement costs without deduction
for depreciation thereof, providing protection against all
perils included within the classification of fire and extended
coverage, vandalism coverage and malicious mischief, sprinkler
leakage, water damage, and special extended coverage on the
building. Additionally, Landlord may
carry: (i) Bodily Injury and Property Damage
Liability Insurance and/or Excess Liability Coverage
Insurance; and (ii) Earthquake
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