EXHIBIT 99.1
[GRAPHIC OMITTED]
STANDARD MULTI-TENANT OFFICE LEASE - GROSS
AIR COMMERCIAL REAL ESTATE ASSOCIATION
1.
Basic Provisions ("Basic Provisions").
1.1
Parties: This Lease ("Lease"), dated for reference purposes
only November 1, 2006, is made by and between Bradshaw Plaza,
Associates, Inc.
dba Bradshaw Plaza ("Lessor") and American River Bank ("Lessee"),
(collectively
the " Parties", or individually a " Party").
1.2(a)
Premises: That certain portion of the Project (as defined
below), known as Suite Numbers(s) 100, First floor(s), consisting
of
approximately 3,711 rentable square feet and approximately 3,711
useable square
feet ("Premises"). The Premises are located at: 9750 Business Park
Drive, in the
City of Sacramento, County of Sacramento, State of California, with
zip code
95827. In addition to Lessee's rights to use and occupy the
Premises as
hereinafter specified, Lessee shall have non-exclusive rights to
the Common
Areas (as defined in Paragraph 2.7 below) as hereinafter specified,
but shall
not have any rights to the roof, the exterior walls, the area above
the dropped
ceilings, or the utility raceways of the building containing the
Premises
("Building") or to any other buildings in the Project. The
Premises, the
Building, the Common Areas, the land upon which they are located,
along with all
other buildings and improvements thereon, are herein collectively
referred to as
the "Project." The Project consists of approximately n/a rentable
square feet.
(See also Paragraph 2)
1.2(b)
Parking: Pro-rata unreserved and 22 reserved vehicle parking
spaces at a monthly cost of $n/a per unreserved space and $n/a per
reserved
space. (See Paragraph 2.6)
1.3
Term: Ten (10) years and Zero (0) months ("Original Term")
commencing December 1, 2006 ("Commencement Date") and ending
November 30,2016
("Expiration Date"). (See also Paragraph 3)
1.4
Early Possession:
n/a ("Early Possession Date").
(See also Paragraphs 3.2 and 3.3)
1.5
Base Rent: $6,865.35 per month ("Base Rent)", payable on the
First day of each month commencing December 1, 2006. (See also
Paragraph 4)
[X] If this box is checked, there are provisions in this Lease for
the Base Rent
to be adjusted.
1.6
Lessee's Share of Operating Expense Increase: Five point
Three-Six Percent percent (5.36%) ("Lessee's Share"). Lessee's
Share has been
calculated by dividing the approximate rentable square footage of
the Premises
by the total approximate square footage of the rentable space
contained in the
Project and shall not be subject to revision except in connection
with an actual
change in the size of the Premises or a change in the space
available for lease
in the Project.
1.7
Base Rent and Other Monies Paid Upon Execution:
(a)
Base Rent: $6,865.35 for the period Monthly.
(b)
Security Deposit: $n/a ("Security Deposit"). (See
also Paragraph 5)
(c)
Parking: $n/a for the period n/a .
(d)
Other: $n/a for n/a.
(e)
Total Due Upon Execution of this Lease : $n/a.
1.8
Agreed Use: General Office and Commercial Banking Operations.
(See also Paragraph 6)
1.9
Base Year; Insuring Party. The Base Year is 2006. Lessor is
the "Insuring Party". (See also Paragraphs 4.2 and 8)
1.10
Real Estate Brokers : (See also Paragraph 15)
(a)
Representation: The following real estate brokers
(the "Brokers") and brokerage relationships exist in this
transaction (check
applicable boxes):
[ ] n/a represents Lessor exclusively (" Lessor's Broker");
[ ] n/a represents Lessee exclusively (" Lessee's Broker"); or
[ ] n/a represents both Lessor and Lessee (" Dual Agency").
(b)
Payment to Brokers: Upon execution and delivery of
this Lease by both Parties, Lessor shall pay to the Brokers the
brokerage fee
agreed to in a separate written agreement (or if there is no such
agreement, the
sum of n/a or n/a % of the total Base Rent for the brokerage
services rendered
by the Brokers).
1.11
Guarantor. The obligations of the Lessee under this Lease
shall be guaranteed by n/a ("Guarantor"). (See also Paragraph 37)
1.12
Business Hours for the Building: 7:00 a.m. to 6:00 p.m.,
Mondays through Fridays (except Building Holidays) and
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n/a a.m. to n/a p.m. on Saturdays (except Building Holidays).
"Building
Holidays" shall mean the dates of observation of New Year's Day,
President's
Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day,
Christmas Day,
and n/a.
1.13
Lessor Supplied Services. Notwithstanding the provisions of
Paragraph 11.1, Lessor is NOT obligated to provide the following:
[X] Janitorial services within American River Bank's suite
[ ] Electricity
[ ] Other
(specify):____________________________________________________________
1.14
Attachments. Attached hereto are the following, all of which
constitute a part of this Lease:
[X] an Addendum consisting of Paragraphs 1 through 14 ;
[X] a plot plan depicting the Premises;
[X] a current set of the Rules and Regulations;
[ ] a Work Letter;
[ ] a janitorial schedule;
[ ] other
(specify):____________________________________________________________
_______________________________________________________________________________.
2.
Premises.
2.1
Letting. Lessor hereby leases to Lessee, and Lessee hereby
leases from Lessor, the Premises, for the term, at the rental, and
upon all of
the terms, covenants and conditions set forth in this Lease. Unless
otherwise
provided herein, any statement of size set forth in this Lease, or
that may have
been used in calculating Rent, is an approximation which the
Parties agree is
reasonable and any payments based thereon are not subject to
revision whether or
not the actual size is more or less. Note: Lessee is advised to
verify the
actual size prior to executing this Lease.
2.2
Condition. Lessor shall deliver the Premises to Lessee in a
clean condition on the Commencement Date or the Early Possession
Date, whichever
first occurs ("Start Date"), and warrants that the existing
electrical,
plumbing, fire sprinkler, lighting, heating, ventilating and air
conditioning
systems ("HVAC"), and all other items which the Lessor is obligated
to construct
pursuant to the Work Letter attached hereto, if any, other than
those
constructed by Lessee, shall be in good operating condition on said
date.
2.3
Compliance. Lessor warrants that the improvements comprising
the Premises and the Common Areas comply with the building codes
that were in
effect at the time that each such improvement, or portion thereof,
was
constructed, and also with all applicable laws, covenants or
restrictions of
record, regulations, and ordinances ("Applicable Requirements") in
effect on
the Start Date. Said warranty does not apply to the use to which
Lessee will put
the Premises, modifications which may be required by the Americans
with
Disabilities Act or any similar laws as a result of Lessee's use
(see Paragraph
50), or to any Alterations or Utility Installations (as defined in
Paragraph
7.3(a)) made or to be made by Lessee. NOTE: Lessee is responsible
for
determining whether or not the zoning and other Applicable
Requirements are
appropriate for Lessee's intended use, and acknowledges that past
uses of the
Premises may no longer be allowed. If the Premises do not comply
with said
warranty, Lessor shall, except as otherwise provided, promptly
after receipt of
written notice from Lessee setting forth with specificity the
nature and extent
of such non-compliance, rectify the same. If the Applicable
Requirements are
hereafter changed so as to require during the term of this Lease
the
construction of an addition to or an alteration of the Premises,
the remediation
of any Hazardous Substance, or the reinforcement or other physical
modification
of the Premises ("Capital Expenditure"), Lessor and Lessee shall
allocate the
cost of such work as follows:
(a)
Subject to Paragraph 2.3(c) below, if such Capital
Expenditures are required as a result of the specific and unique
use of the
Premises by Lessee as compared with uses by tenants in general,
Lessee shall be
fully responsible for the cost thereof, provided, however that if
such Capital
Expenditure is required during the last 2 years of this Lease and
the cost
thereof exceeds 6 months' Base Rent, Lessee may instead terminate
this Lease
unless Lessor notifies Lessee, in writing, within 10 days after
receipt of
Lessee's termination notice that Lessor has elected to pay the
difference
between the actual cost thereof and the amount equal to 6 months'
Base Rent. If
Lessee elects termination, Lessee shall immediately cease the use
of the
Premises which requires such Capital Expenditure and deliver to
Lessor written
notice specifying a termination date at least 90 days thereafter.
Such
termination date shall, however, in no event be earlier than the
last day that
Lessee could legally utilize the Premises without commencing such
Capital
Expenditure.
(b)
If such Capital Expenditure is not the result of the
specific and unique use of the Premises by Lessee (such as,
governmentally
mandated seismic modifications), then Lessor and Lessee shall
allocate the cost
of such Capital Expenditure as follows: Lessor shall advance the
funds necessary
for such Capital Expenditure but Lessee shall be obligated to pay,
each month
during the remainder of the term of this Lease, on the date on
which Base Rent
is due, an amount equal to the product of multiplying Lessee's
share of the cost
of such Capital Expenditure (the percentage specified in Paragraph
1.6 by a
fraction, the numerator of which is one, and the denominator of
which is 144
(ie. 1/144th of the cost per month). Lessee shall pay interest on
the
unamortized balance of Lessee's share at a rate that is
commercially reasonable
in the judgment of Lessor's accountants. Lessee may, however,
prepay its
obligation at any time. Provided, however, that if such Capital
Expenditure is
required during the last 2 years of this Lease or if Lessor
reasonably
determines that it is not economically feasible to pay its share
thereof, Lessor
shall have the option to terminate this Lease upon 90 days prior
written notice
to Lessee unless Lessee notifies Lessor, in writing, within 10 days
after
receipt of Lessor's termination notice that Lessee will pay for
such Capital
Expenditure. If Lessor does not elect to terminate, and fails to
tender its
share of any such Capital Expenditure, Lessee may advance such
funds and deduct
same, with Interest, from Rent until Lessor's share of such costs
have been
fully paid. If Lessee is unable to finance Lessor's share, or if
the balance of
the Rent due and payable for the remainder of this Lease is not
sufficient to
fully reimburse Lessee on an offset basis, Lessee shall have the
right to
terminate this Lease upon 30 days written notice to Lessor.
(c)
Notwithstanding the above, the provisions concerning
Capital Expenditures are intended to apply only to nonvoluntary,
unexpected, and
new Applicable Requirements. If the Capital Expenditures are
instead triggered
by Lessee as a result of an actual or proposed change in use,
change in
intensity of use, or modification to the Premises then, and in that
event,
Lessee shall be fully responsible for the cost thereof, and Lessee
shall not
have any right to terminate this Lease.
2.4
Acknowledgements. Lessee acknowledges that: (a) Lessee has
been advised by Lessor and/or Brokers to satisfy itself with
respect to the
condition of the Premises (including but not limited to the
electrical, HVAC and
fire sprinkler systems, security, environmental aspects, and
compliance with
Applicable Requirements), and their suitability for Lessee's
intended use, (b)
Lessee has made such investigation as it deems necessary with
reference to such
matters and assumes all responsibility therefor as the same relate
to its
occupancy of the Premises, and (c) neither Lessor, Lessor's agents,
nor Brokers
have made any oral or written representations or warranties with
respect to said
matters other than as set forth in this Lease. In addition, Lessor
acknowledges
that: (i) Brokers have made no representations, promises or
warranties
concerning Lessee's ability to honor the Lease or suitability to
occupy the
Premises, and (ii) it is Lessor's sole responsibility to
investigate the
financial capability and/or suitability of all proposed tenants.
2.5
Lessee as Prior Owner/Occupant. The warranties made by Lessor
in Paragraph 2 shall be of no force or effect if immediately prior
to the Start
Date, Lessee was the owner or occupant of the Premises. In such
event, Lessee
shall be responsible for any necessary corrective work.
2.6
Vehicle Parking. So long as Lessee is not in default, and
subject to the Rules and Regulations attached hereto, and as
established by
Lessor from time to time, Lessee shall be entitled to rent and use
the number of
parking spaces specified in Paragraph 1.2(b) at the rental rate
applicable from
time to time for monthly parking as set by Lessor and/or its
licensee.
(a)
If Lessee commits, permits or allows any of the
prohibited activities described in the Lease or the rules then in
effect, then
Lessor shall have the right, without notice, in addition to such
other rights
and remedies that it may have, to remove or tow away the vehicle
involved and
charge the cost to Lessee, which cost shall be immediately payable
upon demand
by Lessor.
(b)
The monthly rent per parking space specified in
Paragraph 1.2(b) is subject to change upon 30 days prior written
notice to
Lessee. The rent for the parking is payable one month in advance
prior to the
first day of each calendar month.
2.7
Common Areas - Definition. The term "Common Areas" is defined
as all areas and facilities outside the Premises and within the
exterior
boundary line of the Project and interior utility raceways and
installations
within the Premises that are provided and designated by the Lessor
from time to
time for the general nonexclusive use of Lessor, Lessee and other
tenants of the
Project and their respective employees, suppliers, shippers,
customers,
contractors and invitees, including, but not limited to, common
entrances,
lobbies, corridors, stairwells, public restrooms, elevators,
parking areas,
loading and unloading areas, trash areas, roadways, walkways,
driveways and
landscaped areas.
2.8
Common Areas - Lessee's Rights. Lessor grants to Lessee, for
the benefit of Lessee and its employees, suppliers, shippers,
contractors,
customers and invitees, during the term of this Lease, the
nonexclusive right to
use, in common with others entitled to such use, the Common Areas
as they exist
from time to time, subject to any rights, powers, and privileges
reserved by
Lessor under the terms hereof or under the terms of any rules and
regulations or
restrictions governing the use of the Project. Under no
circumstances shall the
right herein granted to use the Common Areas be deemed to include
the right to
store any property, temporarily or permanently, in the Common
Areas. Any such
storage shall be
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permitted only by the prior written consent of Lessor or Lessor's
designated
agent, which consent may be revoked at any time. In the event that
any
unauthorized storage shall occur then Lessor shall have the right,
without
notice, in addition to such other rights and remedies that it may
have, to
remove the property and charge the cost to Lessee, which cost shall
be
immediately payable upon demand by Lessor.
2.9
Common Areas - Rules and Regulations. Lessor or such other
person(s) as Lessor may appoint shall have the exclusive control
and management
of the Common Areas and shall have the right, from time to time, to
adopt,
modify, amend and enforce reasonable rules and regulations ("Rules
and
Regulations") for the management, safety, care, and cleanliness of
the grounds,
the parking and unloading of vehicles and the preservation of good
order, as
well as for the convenience of other occupants or tenants of the
Building and
the Project and their invitees. The Lessee agrees to abide by and
conform to all
such Rules and Regulations, and to cause its employees, suppliers,
shippers,
customers, contractors and invitees to so abide and conform. Lessor
shall not be
responsible to Lessee for the noncompliance with said Rules and
Regulations by
other tenants of the Project.
2.10
Common Areas - Changes. Lessor shall have the right, in
Lessor's sole discretion, from time to time:
(a)
To make changes to the Common Areas, including,
without limitation, changes in the location, size, shape and number
of the
lobbies, windows, stairways, air shafts, elevators, escalators,
restrooms,
driveways, entrances, parking spaces, parking areas, loading and
unloading
areas, ingress, egress, direction of traffic, landscaped areas,
walkways and
utility raceways;
(b)
To close temporarily any of the Common Areas for
maintenance purposes so long as reasonable access to the Premises
remains
available;
(c)
To designate other land outside the boundaries of the
Project to be a part of the Common Areas;
(d)
To add additional buildings and improvements to the
Common Areas;
(e)
To use the Common Areas while engaged in making
additional improvements, repairs or alterations to the Project, or
any portion
thereof; and
(f)
To do and perform such other acts and make such other
changes in, to or with respect to the Common Areas and Project as
Lessor may, in
the exercise of sound business judgment, deem to be appropriate.
3.
Term.
3.1
Term. The Commencement Date, Expiration Date and Original Term
of this Lease are as specified in Paragraph 1.3.
3.2
Early Possession. If Lessee totally or partially occupies the
Premises prior to the Commencement Date, the obligation to pay Base
Rent shall
be abated for the period of such early possession. All other terms
of this Lease
(including but not limited to the obligations to pay Lessee's Share
of the
Operating Expense Increase) shall, however, be in effect during
such period. Any
such early possession shall not affect the Expiration Date.
3.3
Delay In Possession. Lessor agrees to use its best
commercially reasonable efforts to deliver possession of the
Premises to Lessee
by the Commencement Date. If, despite said efforts, Lessor is
unable to deliver
possession by such date, Lessor shall not be subject to any
liability therefor,
nor shall such failure affect the validity of this Lease. Lessee
shall not,
however, be obligated to pay Rent or perform its other obligations
until Lessor
delivers possession of the Premises and any period of rent
abatement that Lessee
would otherwise have enjoyed shall run from the date of delivery of
possession
and continue for a period equal to what Lessee would otherwise have
enjoyed
under the terms hereof, but minus any days of delay caused by the
acts or
omissions of Lessee. If possession is not delivered within 60 days
after the
Commencement Date, as the same may be extended under the terms of
any Work
Letter executed by Parties, Lessee may, at its option, by notice in
writing
within 10 days after the end of such 60 day period, cancel this
Lease, in which
event the Parties shall be discharged from all obligations
hereunder. If such
written notice is not received by Lessor within said 10 day period,
Lessee's
right to cancel shall terminate. If possession of the Premises is
not delivered
within 120 days after the Commencement Date, this Lease shall
terminate unless
other agreements are reached between Lessor and Lessee, in writing.
3.4
Lessee Compliance. Lessor shall not be required to deliver
possession of the Premises to Lessee until Lessee complies with its
obligation
to provide evidence of insurance (Paragraph 8.5). Pending delivery
of such
evidence, Lessee shall be required to perform all of its
obligations under this
Lease from and after the Start Date, including the payment of Rent,
notwithstanding Lessor's election to withhold possession pending
receipt of such
evidence of insurance. Further, if Lessee is required to perform
any other
conditions prior to or concurrent with the Start Date, the Start
Date shall
occur but Lessor may elect to withhold possession until such
conditions are
satisfied.
4.
Rent.
4.1.
Rent Defined. All monetary obligations of Lessee to Lessor
under the terms of this Lease (except for the Security Deposit) are
deemed to be
rent ("Rent").
4.2
Operating Expense Increase. Lessee shall pay to Lessor during
the term hereof, in addition to the Base Rent, Lessee's Share of
the amount by
which all Operating Expenses for each Comparison Year exceeds the
amount of all
Operating Expenses for the Base Year, such excess being hereinafter
referred to
as the "Operating Expense Increase", in accordance with the
following
provisions:
(a)
"Base Year" is as specified in Paragraph 1.9.
(b)
"Comparison Year" is defined as each calendar year
during the term of this Lease subsequent to the Base Year;
provided, however,
Lessee shall have no obligation to pay a share of the Operating
Expense Increase
applicable to the first 12 months of the Lease Term (other than
such as are
mandated by a governmental authority, as to which government
mandated expenses
Lessee shall pay Lessee's Share, notwithstanding they occur during
the first
twelve (12) months). Lessee's Share of the Operating Expense
Increase for the
first and last Comparison Years of the Lease Term shall be prorated
according to
that portion of such Comparison Year as to which Lessee is
responsible for a
share of such increase.
(c)
"Operating Expenses" include all costs incurred by
Lessor relating to the ownership and operation of the Project,
calculated as if
the Project was at least 95% occupied, including, but not limited
to, the
following:
(i)
The operation, repair, and maintenance in
neat, clean, safe, good order and condition, but not the
replacement (see
subparagraph (g)), of the following:
(aa)
The Common Areas, including their
surfaces, coverings, decorative items, carpets, drapes and window
coverings, and
including parking areas, loading and unloading areas, trash areas,
roadways,
sidewalks, walkways, stairways, parkways, driveways, landscaped
areas, striping,
bumpers, irrigation systems, Common Area lighting facilities,
building exteriors
and roofs, fences and gates;
(bb)
All heating, air conditioning,
plumbing, electrical systems, life safety equipment, communication
systems and
other equipment used in common by, or for the benefit of, lessees
or occupants
of the Project, including elevators and escalators, tenant
directories, fire
detection systems including sprinkler system maintenance and
repair.
(ii)
Trash disposal, janitorial and security
services, pest control services, and the costs of any environmental
inspections;
(iii)
Any other service to be provided by Lessor
that is elsewhere in this Lease stated to be an "Operating
Expense";
(iv)
The cost of the premiums for the insurance
policies maintained by Lessor pursuant to paragraph 8 and any
deductible portion
of an insured loss concerning the Building or the Common Areas;
(v)
The amount of the Real Property Taxes
payable by Lessor pursuant to paragraph 10;
(vi)
The cost of water, sewer, gas, electricity,
and other publicly mandated services not separately metered;
(vii)
Labor, salaries, and applicable fringe
benefits and costs, materials, supplies and tools, used in
maintaining and/or
cleaning the Project and accounting and management fees
attributable to the
operation of the Project;
(viii)
The cost of any Capital Expenditure to the
Building or the Project not covered under the provisions of
Paragraph 2.3
provided; however, that Lessor shall allocate the cost of any such
Capital
Expenditure over a 12 year period and Lessee shall not be required
to pay more
than Lessee's Share of 1/144th of the cost of such Capital
Expenditure in any
given month;
(ix)
Replacement of equipment or improvements
that have a useful life for accounting purposes of 5 years or less.
(d)
Any item of Operating Expense that is specifically
attributable to the Premises, the Building or to any other building
in the
Project or to the operation, repair and maintenance thereof, shall
be allocated
entirely to such Premises, Building, or other building. However,
any such item
that is not specifically attributable to the Building or to any
other building
or to the operation, repair and maintenance thereof, shall be
equitably
allocated by Lessor to all buildings in the Project.
(e)
The inclusion of the improvements, facilities and
services set forth in Subparagraph 4.2(c) shall not be deemed to
impose an
obligation upon Lessor to either have said improvements or
facilities or to
provide those services unless the Project already has the same,
Lessor already
provides the services, or Lessor has agreed elsewhere in this Lease
to provide
the same or some of them.
(f)
Lessee's Share of Operating Expense Increase shall be
payable by Lessee within 10 days after a reasonably detailed
statement of actual
expenses is presented to Lessee by Lessor. At Lessor's option,
however, an
amount may be estimated by Lessor from time to time in advance of
Lessee's Share
of the Operating Expense Increase for any Comparison Year, and the
same shall be
payable monthly during each Comparison Year of the Lease term, on
the same day
as the Base Rent is due hereunder. In the event that Lessee pays
Lessor's
estimate of Lessee's Share of Operating Expense Increase as
aforesaid, Lessor
shall deliver to Lessee within 60 days after the expiration of each
Comparison
Year a reasonably detailed statement showing Lessee's Share of the
actual
Operating Expense Increase incurred during such year. If Lessee's
payments under
this paragraph (f) during said Comparison Year exceed Lessee's
Share as
indicated on said statement, Lessee shall be entitled to credit the
amount of
such overpayment against Lessee's Share of Operating Expense
Increase next
falling due. If Lessee's payments under this paragraph
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during said Comparison Year were less than Lessee's Share as
indicated on said
statement, Lessee shall pay to Lessor the amount of the deficiency
within 10
days after delivery by Lessor to Lessee of said statement. Lessor
and Lessee
shall forthwith adjust between them by cash payment any balance
determined to
exist with respect to that portion of the last Comparison Year for
which Lessee
is responsible as to Operating Expense Increases, notwithstanding
that the Lease
term may have terminated before the end of such Comparison Year.
(g)
Operating Expenses shall not include the costs of
replacement for equipment or capital components such as the roof,
foundations,
exterior walls or a Common Area capital improvement, such as the
parking lot
paving, elevators, fences that have a useful life for accounting
purposes of 5
years or more unless it is of the type described in paragraph
4.2(c) (viii), in
which case their cost shall be included as above provided.
(h)
Operating Expenses shall not include any expenses
paid by any tenant directly to third parties, or as to which Lessor
is otherwise
reimbursed by any third party, other tenant, or by insurance
proceeds.
4.3
Payment. Lessee shall cause payment of Rent to be received by
Lessor in lawful money of the United States on or before the day on
which it is
due, without offset or deduction (except as specifically permitted
in this
Lease). Rent for any period during the term hereof which is for
less than one
full calendar month shall be prorated based upon the actual number
of days of
said month. Payment of Rent shall be made to Lessor at its address
stated herein
or to such other persons or place as Lessor may from time to time
designate in
writing. Acceptance of a payment which is less than the amount then
due shall
not be a waiver of Lessor's rights to the balance of such Rent,
regardless of
Lessor's endorsement of any check so stating. In the event that any
check,
draft, or other instrument of payment given by Lessee to Lessor is
dishonored
for any reason, Lessee agrees to pay to Lessor the sum of $25 in
addition to any
Late Charge. Payments will be applied first to accrued late charges
and
attorney's fees, second to accrued interest, then to Base Rent and
Operating
Expense Increase, and any remaining amount to any other outstanding
charges or
costs.
5.
Security Deposit. Lessee shall deposit with Lessor upon execution
hereof the Security Deposit as security for Lessee's faithful
performance of its
obligations under this Lease. If Lessee fails to pay Rent, or
otherwise Defaults
under this Lease, Lessor may use, apply or retain all or any
portion of said
Security Deposit for the payment of any amount due Lessor or to
reimburse or
compensate Lessor for any liability, expense, loss or damage which
Lessor may
suffer or incur by reason thereof. If Lessor uses or applies all or
any portion
of the Security Deposit, Lessee shall within 10 days after written
request
therefor, deposit monies with Lessor sufficient to restore said
Security Deposit
to the full amount required by this Lease. If the Base Rent
increases during the
term of this Lease, Lessee shall, upon written request from Lessor,
deposit
additional moneys with Lessor so that the total amount of the
Security Deposit
shall at all times bear the same proportion to the increased Base
Rent as the
initial Security Deposit bore to the initial Base Rent. Should the
Agreed Use be
amended to accommodate a material change in the business of Lessee
or to
accommodate a sublessee or assignee, Lessor shall have the right to
increase the
Security Deposit to the extent necessary, in Lessor's reasonable
judgment, to
account for any increased wear and tear that the Premises may
suffer as a result
thereof. If a change in control of Lessee occurs during this Lease
and following
such change the financial condition of Lessee is, in Lessor's
reasonable
judgment, significantly reduced, Lessee shall deposit such
additional monies
with Lessor as shall be sufficient to cause the Security Deposit to
be at a
commercially reasonable level based on such change in financial
condition.
Lessor shall not be required to keep the Security Deposit separate
from its
general accounts. Within 14 days after the expiration or
termination of this
Lease, if Lessor elects to apply the Security Deposit only to
unpaid Rent, and
otherwise within 30 days after the Premises have been vacated
pursuant to
Paragraph 7.4(c) below, Lessor shall return that portion of the
Security Deposit
not used or applied by Lessor. No part of the Security Deposit
shall be
considered to be held in trust, to bear interest or to be
prepayment for any
monies to be paid by Lessee under this Lease.
6.
Use.
6.1
Use. Lessee shall use and occupy the Premises only for the
Agreed Use, or any other legal use which is reasonably comparable
thereto, and
for no other purpose. Lessee shall not use or permit the use of the
Premises in
a manner that is unlawful, creates damage, waste or a nuisance, or
that disturbs
occupants of or causes damage to neighboring premises or
properties. Lessor
shall not unreasonably withhold or delay its consent to any written
request for
a modification of the Agreed Use, so long as the same will not
impair the
structural integrity of the improvements of the Building, will not
adversely
affect the mechanical, electrical, HVAC, and other systems of the
Building,
and/or will not affect the exterior appearance of the Building. If
Lessor elects
to withhold consent, Lessor shall within 7 days after such request
give written
notification of same, which notice shall include an explanation of
Lessor's
objections to the change in the Agreed Use.
6.2
Hazardous Substances.
(a)
Reportable Uses Require Consent . The term "Hazardous
Substance" as used in this Lease shall mean any product, substance,
or waste
whose presence, use, manufacture, disposal, transportation, or
release, either
by itself or in combination with other materials expected to be on
the Premises,
is either: (i) potentially injurious to the public health, safety
or welfare,
the environment or the Premises, (ii) regulated or monitored by any
governmental
authority, or (iii) a basis for potential liability of Lessor to
any
governmental agency or third party under any applicable statute or
common law
theory. Hazardous Substances shall include, but not be limited to,
hydrocarbons,
petroleum, gasoline, and/or crude oil or any products, byproducts
or fractions
thereof. Lessee shall not engage in any activity in or on the
Premises which
constitutes a Reportable Use of Hazardous Substances without the
express prior
written consent of Lessor and timely compliance (at Lessee's
expense) with all
Applicable Requirements. "Reportable Use" shall mean (i) the
installation or use
of any above or below ground storage tank, (ii) the generation,
possession,
storage, use, transportation, or disposal of a Hazardous Substance
that requires
a permit from, or with respect to which a report, notice,
registration or
business plan is required to be filed with, any governmental
authority, and/or
(iii) the presence at the Premises of a Hazardous Substance with
respect to
which any Applicable Requirements requires that a notice be given
to persons
entering or occupying the Premises or neighboring properties.
Notwithstanding
the foregoing, Lessee may use any ordinary and customary materials
reasonably
required to be used in the normal course of the Agreed Use such as
ordinary
office supplies (copier toner, liquid paper, glue, etc.) and common
household
cleaning materials, so long as such use is in compliance with all
Applicable
Requirements, is not a Reportable Use, and does not expose the
Premises or
neighboring property to any meaningful risk of contamination or
damage or expose
Lessor to any liability therefor. In addition, Lessor may condition
its consent
to any Reportable Use upon receiving such additional assurances as
Lessor
reasonably deems necessary to protect itself, the public, the
Premises and/or
the environment against damage, contamination, injury and/or
liability,
including, but not limited to, the installation (and removal on or
before Lease
expiration or termination) of protective modifications (such as
concrete
encasements) and/or increasing the Security Deposit.
(b)
Duty to Inform Lessor. If Lessee knows, or has
reasonable cause to believe, that a Hazardous Substance has come to
be located
in, on, under or about the Premises, other than as previously
consented to by
Lessor, Lessee shall immediately give written notice of such fact
to Lessor, and
provide Lessor with a copy of any report, notice, claim or other
documentation
which it has concerning the presence of such Hazardous Substance.
(c)
Lessee Remediation. Lessee shall not cause or permit
any Hazardous Substance to be spilled or released in, on, under, or
about the
Premises (including through the plumbing or sanitary sewer system)
and shall
promptly, at Lessee's expense, comply with all Applicable
Requirements and take
all investigatory and/or remedial action reasonably recommended,
whether or not
formally ordered or required, for the cleanup of any contamination
of, and for
the maintenance, security and/or monitoring of the Premises or
neighboring
properties, that was caused or materially contributed to by Lessee,
or
pertaining to or involving any Hazardous Substance brought onto the
Premises
during the term of this Lease, by or for Lessee, or any third
party.
(d)
Lessee Indemnification. Lessee shall indemnify,
defend and hold Lessor, its agents, employees, lenders and ground
lessor, if
any, harmless from and against any and all loss of rents and/or
damages,
liabilities, judgments, claims, expenses, penalties, and attorneys'
and
consultants' fees arising out of or involving any Hazardous
Substance brought
onto the Premises by or for Lessee, or any third party (provided,
however, that
Lessee shall have no liability under this Lease with respect to
underground
migration of any Hazardous Substance under the Premises from areas
outside of
the Project not caused or contributed to by Lessee). Lessee's
obligations shall
include, but not be limited to, the effects of any contamination or
injury to
person, property or the environment created or suffered by Lessee,
and the cost
of investigation, removal, remediation, restoration and/or
abatement, and shall
survive the expiration or termination of this Lease. No
termination,
cancellation or release agreement entered into by Lessor and Lessee
shall
release Lessee from its obligations under this Lease with respect
to Hazardous
Substances, unless specifically so agreed by Lessor in writing at
the time of
such agreement.
(e)
Lessor Indemnification. Lessor and its successors
and assigns shall indemnify, defend, reimburse and hold Lessee, its
employees
and lenders, harmless from and against any and all environmental
damages,
including the cost of remediation, which result from Hazardous
Substances which
existed on the Premises prior to Lessee's occupancy or which are
caused by the
gross negligence or willful misconduct of Lessor, its agents or
employees.
Lessor's obligations, as and when required by the Applicable
Requirements, shall
include, but not be limited to, the cost of investigation, removal,
remediation,
restoration and/or abatement, and shall survive the expiration or
termination of
this Lease.
(f)
Investigations and Remediations. Lessor shall retain
the responsibility and pay for any investigations or remediation
measures
required by governmental entities having jurisdiction with respect
to the
existence of Hazardous Substances on the Premises prior to Lessee's
occupancy,
unless such remediation measure is required as a result of Lessee's
use
(including "Alterations", as defined in paragraph 7.3(a) below) of
the Premises,
in which event Lessee shall be responsible for such payment. Lessee
shall
cooperate fully in any such activities at the request of Lessor,
including
allowing Lessor and Lessor's agents to have reasonable access to
the Premises at
reasonable times in order to carry out Lessor's investigative and
remedial
responsibilities.
(g)
Lessor Termination Option. If a Hazardous Substance
Condition (see Paragraph 9.1(e)) occurs during the term of this
Lease, unless
Lessee is legally responsible therefor (in which case Lessee shall
make the
investigation and remediation thereof required by the Applicable
Requirements
and this Lease shall continue in full force and effect, but subject
to Lessor's
rights under Paragraph 6.2(d) and Paragraph 13), Lessor
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may, at Lessor's option, either (i) investigate and remediate such
Hazardous
Substance Condition, if required, as soon as reasonably possible at
Lessor's
expense, in which event this Lease shall continue in full force and
effect, or
(ii) if the estimated cost to remediate such condition exceeds 12
times the then
monthly Base Rent or $100,000, whichever is greater, give written
notice to
Lessee, within 30 days after receipt by Lessor of knowledge of the
occurrence of
such Hazardous Substance Condition, of Lessor's desire to terminate
this Lease
as of the date 60 days following the date of such notice. In the
event Lessor
elects to give a termination notice, Lessee may, within 10 days
thereafter, give
written notice to Lessor of Lessee's commitment to pay the amount
by which the
cost of the remediation of such Hazardous Substance Condition
exceeds an amount
equal to 12 times the then monthly Base Rent or $100,000, whichever
is greater.
Lessee shall provide Lessor with said funds or satisfactory
assurance thereof
within 30 days following such commitment. In such event, this Lease
shall
continue in full force and effect, and Lessor shall proceed to make
such
remediation as soon as reasonably possible after the required funds
are
available. If Lessee does not give such notice and provide the
required funds or
assurance thereof within the time provided, this Lease shall
terminate as of the
date specified in Lessor's notice of termination.
6.3
Lessee's Compliance with Applicable Requirements. Except as
otherwise provided in this Lease, Lessee shall, at Lessee's sole
expense, fully,
diligently and in a timely manner, materially comply with all
Applicable
Requirements, the requirements of any applicable fire insurance
underwriter or
rating bureau, and the recommendations of Lessor's engineers and/or
consultants
which relate in any manner to the Premises, without regard to
whether said
requirements are now in effect or become effective after the Start
Date. Lessee
shall, within 10 days after receipt of Lessor's written request,
provide Lessor
with copies of all permits and other documents, and other
information evidencing
Lessee's compliance with any Applicable Requirements specified by
Lessor, and
shall immediately upon receipt, notify Lessor in writing (with
copies of any
documents involved) of any threatened or actual claim, notice,
citation,
warning, complaint or report pertaining to or involving the failure
of Lessee or
the Premises to comply with any Applicable Requirements.
6.4
Inspection; Compliance. Lessor and Lessor's "Lender" (as
defined in Paragraph 30) and consultants shall have the right to
enter into
Premises at any time, in the case of an emergency, and otherwise at
reasonable
times, for the purpose of inspecting the condition of the Premises
and for
verifying compliance by Lessee with this Lease. The cost of any
such inspections
shall be paid by Lessor, unless a violation of Applicable
Requirements, or a
Hazardous Substance Condition (see paragraph 9.1e) is found to
exist or be
imminent, or the inspection is requested or ordered by a
governmental authority.
In such case, Lessee shall upon request reimburse Lessor for the
cost of such
inspection, so long as such inspection is reasonably related to the
violation or
contamination.
7.
Maintenance; Repairs; Utility Installations; Trade Fixtures and
Alterations.
7.1
Lessee's Obligations. Notwithstanding Lessor's obligation to
keep the Premises in good condition and repair, Lessee shall be
responsible for
payment of the cost thereof to Lessor as additional rent for that
portion of the
cost of any maintenance and repair of the Premises, or any
equipment (wherever
located) that serves only Lessee or the Premises, to the extent
such cost is
attributable to causes beyond normal wear and tear. Lessee shall be
responsible
for the cost of painting, repairing or replacing wall coverings,
and to repair
or replace any improvements with the Premises. Lessor may, at its
option, upon
reasonable notice, elect to have Lessee perform any particular such
maintenance
or repairs the cost of which is otherwise Lessee's responsibility
hereunder.
7.2
Lessor's Obligations. Subject to the provisions of Paragraphs
2.2 (Condition), 2.3 (Compliance), 4.2 (Operating Expenses), 6
(Use), 7.1
(Lessee's Obligations), 9 (Damage or Destruction) and 14
(Condemnation), Lessor,
subject to reimbursement pursuant to Paragraph 4.2, shall keep in
good order,
condition and repair the foundations, exterior walls, structural
condition of
interior bearing walls, exterior roof, fire sprinkler system, fire
alarm and/or
smoke detection systems, fire hydrants, and the Common Areas.
Lessee expressly
waives the benefit of any statute now or hereafter in effect to the
extent it is
inconsistent with the terms of this Lease.
7.3
Utility Installations; Trade Fixtures; Alterations.
(a)
Definitions. The term "Utility Installations" refers
to all floor and window coverings, air lines, vacuum lines, power
panels,
electrical distribution, security and fire protection systems,
communication
cabling, lighting fixtures, HVAC equipment, and plumbing in or on
the Premises.
The term "Trade Fixtures" shall mean Lessee's machinery and
equipment that can
be removed without doing material damage to the Premises. The term
"
Alterations" shall mean any modification of the improvements, other
than Utility
Installations or Trade Fixtures, whether by addition or deletion. "
Lessee Owned
Alterations and/or Utility Installations " are defined as
Alterations and/or
Utility Installations made by Lessee that are not yet owned by
Lessor pursuant
to Paragraph 7.4(a).
(b)
Consent. Lessee shall not make any Alterations or
Utility Installations to the Premises without Lessor's prior
written consent.
Lessee may, however, make non-structural Utility Installations to
the interior
of the Premises (excluding the roof) without such consent but upon
notice to
Lessor, as long as they are not visible from the outside, do not
involve
puncturing, relocating or removing the roof, ceilings, floors or
any existing
walls, will not affect the electrical, plumbing, HVAC, and/or life
safety
systems, and the cumulative cost thereof during this Lease as
extended does not
exceed $2000. Notwithstanding the foregoing, Lessee shall not make
or permit any
roof penetrations and/or install anything on the roof without the
prior written
approval of Lessor. Lessor may, as a precondition to granting such
approval,
require Lessee to utilize a contractor chosen and/or approved by
Lessor. Any
Alterations or Utility Installations that Lessee shall desire to
make and which
require the consent of the Lessor shall be presented to Lessor in
written form
with detailed plans. Consent shall be deemed conditioned upon
Lessee's: (i)
acquiring all applicable governmental permits, (ii) furnishing
Lessor with
copies of both the permits and the plans and specifications prior
to
commencement of the work, and (iii) compliance with all conditions
of said
permits and other Applicable Requirements in a prompt and
expeditious manner.
Any Alterations or Utility Installations shall be performed in a
workmanlike
manner with good and sufficient materials. Lessee shall promptly
upon completion
furnish Lessor with asbuilt plans and specifications. For work
which costs an
amount in excess of one month's Base Rent, Lessor may condition its
consent upon
Lessee providing a lien and completion bond in an amount equal to
150% of the
estimated cost of such Alteration or Utility Installation and/or
upon Lessee's
posting an additional Security Deposit with Lessor.
(c)
Liens; Bonds. Lessee shall pay, when due, all claims
for labor or materials furnished or alleged to have been furnished
to or for
Lessee at or for use on the Premises, which claims are or may be
secured by any
mechanic's or materialmen's lien against the Premises or any
interest therein.
Lessee shall give Lessor not less than 10 days notice prior to the
commencement
of any work in, on or about the Premises, and Lessor shall have the
right to
post notices of non-responsibility. If Lessee shall contest the
validity of any
such lien, claim or demand, then Lessee shall, at its sole expense
defend and
protect itself, Lessor and the Premises against the same and shall
pay and
satisfy any such adverse judgment that may be rendered thereon
before the
enforcement thereof. If Lessor shall require, Lessee shall furnish
a surety bond
in an amount equal to 150% of the amount of such contested lien,
claim or
demand, indemnifying Lessor against liability for the same. If
Lessor elects to
participate in any such action, Lessee shall pay Lessor's
attorneys' fees and
costs.
7.4
Ownership; Removal; Surrender; and Restoration.
(a)
Ownership. Subject to Lessor's right to require
removal or elect ownership as hereinafter provided, all Alterations
and Utility
Installations made by Lessee shall be the property of Lessee, but
considered a
part of the Premises. Lessor may, at any time, elect in writing to
be the owner
of all or any specified part of the Lessee Owned Alterations and
Utility
Installations. Unless otherwise instructed per paragraph 7.4(b)
hereof, all
Lessee Owned Alterations and Utility Installations shall, at the
expiration or
termination of this Lease, become the property of Lessor and be
surrendered by
Lessee with the Premises.
(b)
Removal. By delivery to Lessee of written notice from
Lessor not earlier than 90 and not later than 30 days prior to the
end of the
term of this Lease, Lessor may require that any or all Lessee Owned
Alterations
or Utility Installations be removed by the expiration or
termination of this
Lease. Lessor may require the removal at any time of all or any
part of any
Lessee Owned Alterations or Utility Installations made without the
required
consent.
(c)
Surrender; Restoration. Lessee shall surrender the
Premises by the Expiration Date or any earlier termination date,
with all of the
improvements, parts and surfaces thereof clean and free of debris,
and in good
operating order, condition and state of repair, ordinary wear and
tear excepted.
"Ordinary wear and tear" shall not include any damage or
deterioration that
would have been prevented by good maintenance practice.
Notwithstanding the
foregoing, if this Lease is for 12 months or less, then Lessee
shall surrender
the Premises in the same condition as delivered to Lessee on the
Start Date with
NO allowance for ordinary wear and tear. Lessee shall repair any
damage
occasioned by the installation, maintenance or removal of Trade
Fixtures, Lessee
owned Alterations and/or Utility Installations, furnishings, and
equipment as
well as the removal of any storage tank installed by or for Lessee.
Lessee shall
also completely remove from the Premises any and all Hazardous
Substances
brought onto the Premises by or for Lessee, or any third party
(except Hazardous
Substances which were deposited via underground migration from
areas outside of
the Project) even if such removal would require Lessee to perform
or pay for
work that exceeds statutory requirements. Trade Fixtures shall
remain the
property of Lessee and shall be removed by Lessee. The failure by
Lessee to
timely vacate the Premises pursuant to this Paragraph 7.4(c)
without the express
written consent of Lessor shall constitute a holdover under the
provisions of
Paragraph 26 below.
8.
Insurance; Indemnity.
8.1
Insurance Premiums. The cost of the premiums for the
insurance policies maintained by Lessor pursuant to paragraph 8 are
included as
Operating Expenses (see paragraph 4.2 (c)(iv)). Said costs shall
include
increases in the premiums resulting from additional coverage
related to
requirements of the holder of a mortgage or deed of trust covering
the Premises,
Building and/or Project, increased valuation of the Premises,
Building and/or
Project, and/or a general premium rate increase. Said costs shall
not, however,
include any premium increases resulting from the nature of the
occupancy of any
other tenant of the Building. If the Project was not insured for
the entirety of
the Base Year, then the base premium shall be the lowest annual
premium
reasonably obtainable for the required insurance as of the Start
Date, assuming
the most nominal use possible of the Building and/or Project. In no
event,
however, shall Lessee be responsible for any portion of the premium
cost
attributable to liability insurance
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coverage in excess of $2,000,000 procured under Paragraph 8.2(b).
8.2
Liability Insurance.
(a)
Carried by Lessee. Lessee shall obtain and keep in
force a Commercial General Liability policy of insurance protecting
Lessee and
Lessor as an additional insured against claims for bodily injury,
personal
injury and property damage based upon or arising out of the
ownership, use,
occupancy or maintenance of the Premises and all areas appurtenant
thereto. Such
insurance shall be on an occurrence basis providing single limit
coverage in an
amount not less than $1,000,000 per occurrence with an annual
aggregate of not
less than $2,000,000, an "Additional Insured-Managers or Lessors of
Premises
Endorsement" and contain the "Amendment of the Pollution Exclusion
Endorsement"
for damage caused by heat, smoke or fumes from a hostile fire. The
policy shall
not contain any intra-insured exclusions as between insured persons
or
organizations, but shall include coverage for liability assumed
under this Lease
as an " insured contract" for the performance of Lessee's indemnity
obligations
under this Lease. The limits of said insurance shall not, however,
limit the
liability of Lessee nor relieve Lessee of any obligation hereunder.
All
insurance carried by Lessee shall be primary to and not
contributory with any
similar insurance carried by Lessor, whose insurance shall be
considered excess
insurance only.
(b)
Carried by Lessor. Lessor shall maintain liability
insurance as described in Paragraph 8.2(a), in addition to, and not
in lieu of,
the insurance required to be maintained by Lessee. Lessee shall not
be named as
an additional insured therein.
8.3
Property Insurance - Building, Improvements and Rental Value.
(a)
Building and Improvements. Lessor shall obtain and
keep in force a policy or policies of insurance in the name of
Lessor, with loss
payable to Lessor, any ground-lessor, and to any Lender insuring
loss or damage
to the Building and/or Project. The amount of such insurance shall
be equal to
the full replacement cost of the Building and/or Project, as the
same shall
exist from time to time, or the amount required by any Lender, but
in no event
more than the commercially reasonable and available insurable value
thereof.
Lessee Owned Alterations and Utility Installations, Trade Fixtures,
and Lessee's
personal property shall be insured by Lessee under Paragraph 8.4.
If the
coverage is available and commercially appropriate, such policy or
policies
shall insure against all risks of direct physical loss or damage
(except the
perils of flood and/or earthquake unless required by a Lender),
including
coverage for debris removal and the enforcement of any Applicable
Requirements
requiring the upgrading, demolition, reconstruction or replacement
of any
portion of the Premises as the result of a covered loss. Said
policy or policies
shall also contain an agreed valuation provision in lieu of any
coinsurance
clause, waiver of subrogation, and inflation guard protection
causing an
increase in the annual property insurance coverage amount by a
factor of not
less than the adjusted U.S. Department of Labor Consumer Price
Index for All
Urban Consumers for the city nearest to where the Premises are
located. If such
insurance coverage has a deductible clause, the deductible amount
shall not
exceed $1,000 per occurrence.
(b)
Rental Value. Lessor shall also obtain and keep in
force a policy or policies in the name of Lessor with loss payable
to Lessor and
any Lender, insuring the loss of the full Rent for one year with an
extended
period of indemnity for an additional 180 days ("Rental Value
insurance"). Said
insurance shall contain an agreed valuation provision in lieu of
any coinsurance
clause, and the amount of coverage shall be adjusted annually to
reflect the
projected Rent otherwise payable by Lessee, for the next 12 month
period.
(c)
Adjacent Premises. Lessee shall pay for any increase
in the premiums for the property insurance of the Building and for
the Common
Areas or other buildings in the Project if said increase is caused
by Lessee's
acts, omissions, use or occupancy of the Premises.
(d)
Lessee's Improvements. Since Lessor is the Insuring
Party, Lessor shall not be required to insure Lessee Owned
Alterations and
Utility Installations unless the item in question has become the
property of
Lessor under the terms of this Lease.
8.4
Lessee's Property; Business Interruption Insurance.
(a)
Property Damage. Lessee shall obtain and maintain
insurance coverage on all of Lessee's personal property, Trade
Fixtures, and
Lessee Owned Alterations and Utility Installations. Such insurance
shall be full
replacement cost coverage with a deductible of not to exceed $1,000
per
occurrence. The proceeds from any such insurance shall be used by
Lessee for the
replacement of personal property, Trade Fixtures and Lessee Owned
Alterations
and Utility Installations. Lessee shall provide Lessor with written
evidence
that such insurance is in force.
(b)
Business Interruption. Lessee shall obtain and
maintain loss of income and extra expense insurance in amounts as
will reimburse
Lessee for direct or indirect loss of earnings attributable to all
perils
commonly insured against by prudent lessees in the business of
Lessee or
attributable to prevention of access to the Premises as a result of
such perils.
(c)
No Representation of Adequate Coverage. Lessor makes
no representation that the limits or forms of coverage of insurance
specified
herein are adequate to cover Lessee's property, business operations
or
obligations under this Lease.
8.5
Insurance Policies. Insurance required herein shall be by
companies duly licensed or admitted to transact business in the
state where the
Premises are located, and maintaining during the policy term a
"General
Policyholders Rating" of at least B+, V, as set forth in the most
current issue
of "Best's Insurance Guide", or such other rating as may be
required by a
Lender. Lessee shall not do or permit to be done anything which
invalidates the
required insurance policies. Lessee shall, prior to the Start Date,
deliver to
Lessor certified copies of policies of such insurance or
certificates evidencing
the existence and amounts of the required insurance. No such policy
shall be
cancelable or subject to modification except after 30 days prior
written notice
to Lessor. Lessee shall, at least 30 days prior to the expiration
of such
policies, furnish Lessor with evidence of renewals or "insurance
binders"
evidencing renewal thereof, or Lessor may order such insurance and
charge the
cost thereof to Lessee, which amount shall be payable by Lessee to
Lessor upon
demand. Such policies shall be for a term of at least one year, or
the length of
the remaining term of this Lease, whichever is less. If either
Party shall fail
to procure and maintain the insurance required to be carried by it,
the other
Party may, but shall not be required to, procure and maintain the
same.
8.6
Waiver of Subrogation. Without affecting any other rights or
remedies, Lessee and Lessor each hereby release and relieve the
other, and waive
their entire right to recover damages against the other, for loss
of or damage
to its property arising out of or incident to the perils required
to be insured
against herein. The effect of such releases and waivers is not
limited by the
amount of insurance carried or required, or by any deductibles
applicable
hereto. The Parties agree to have their respective property damage
insurance
carriers waive any right to subrogation that such companies may
have against
Lessor or Lessee, as the case may be, so long as the insurance is
not
invalidated thereby.
8.7
Indemnity. Except for Lessor's gross negligence or willful
misconduct, Lessee shall indemnify, protect, defend and hold
harmless the
Premises, Lessor and its agents, Lessor's master or ground lessor,
partners and
Lenders, from and against any and all claims, loss of rents and/or
damages,
liens, judgments, penalties, attorneys' and consultants' fees,
expenses and/or
liabilities arising out of, involving, or in connection with, the
use and/or
occupancy of the Premises by Lessee. If any action or proceeding is
brought
against Lessor by reason of any of the foregoing matters, Lessee
shall upon
notice defend the same at Lessee's expense by counsel reasonably
satisfactory to
Lessor and Lessor shall cooperate with Lessee in such defense.
Lessor need not
have first paid any such claim in order to be defended or
indemnified.
8.8
Exemption of Lessor from Liability. Lessor shall not be
liable for injury or damage to the person or goods, wares,
merchandise or other
property of Lessee, Lessee's employees, contractors, invitees,
customers, or any
other person in or about the Premises, whether such damage or
injury is caused
by or results from fire, steam, electricity, gas, water or rain, or
from the
breakage, leakage, obstruction or other defects of pipes, fire
sprinklers,
wires, appliances, plumbing, HVAC or lighting fixtures, or from any
other cause,
whether the said injury or damage results from conditions arising
upon the
Premises or upon other portions of the Building, or from other
sources or
places. Lessor shall not be liable for any damages arising from any
act or
neglect of any other tenant of Lessor nor from the failure of
Lessor to enforce
the provisions of any other lease in the Project. Notwithstanding
Lessor's
negligence or breach of this Lease, Les
