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EXHIBIT 10.40
LEVI'S PLAZA
HAAS BUILDING
RETAIL LEASE
between
BLUE JEANS EQUITIES WEST
as Landlord
and
BUSINESS RESOURCE GROUP,
as Tenant
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TABLE OF CONTENTS
Page
R E C I T A L S ..............................................................1
1. BASIC LEASE INFORMATION...................................................1
2. PREMISES..................................................................3
3. TERM; ACCEPTANCE OF THE PREMISES..........................................3
4. RENT; ADDITIONAL CHARGES..................................................4
5. ADDITIONAL CHARGES FOR EXPENSES AND REAL ESTATE TAXES.....................4
6. USE.......................................................................8
7. CONSTRUCTION OF PREMISES; BUILDING CHANGES................................9
8. ALTERATIONS...............................................................9
9. REPAIRS MAINTENANCE......................................................10
10. LIENS....................................................................11
11. COMPLIANCE WITH LAWS, ENVIRONMENTAL MATTERS AND INSURANCE REQUIREMENTS...11
12. SUBORDINATION............................................................13
13. INABILITY TO PERFORM.....................................................13
14. DESTRUCTION..............................................................14
15. EMINENT DOMAIN...........................................................15
16. ASSIGNMENT AND SUBLETTING................................................15
17. UTILITIES................................................................19
18. DEFAULT..................................................................19
19. LANDLORD'S RIGHT TO CURE TENANT'S DEFAULTS...............................20
20. MORTGAGEE PROTECTION.....................................................21
21. INDEMNITY; TENANT'S INSURANCE............................................21
22. LIMITATION OF LANDLORD'S LIABILITY.......................................22
23. ACCESS TO PREMISES.......................................................23
24. NOTICES..................................................................23
25. NO WAIVER................................................................23
26. TENANT'S CERTIFICATES....................................................24
27. RULES AND REGULATIONS....................................................24
28. TAXES PAYABLE BY TENANT..................................................24
29. SECURITY DEPOSIT.........................................................25
30. AUTHORITY................................................................25
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TABLE OF CONTENTS
Page
31. PUBLIC TRANSIT INFORMATION...............................................25
32. SIGNAGE..................................................................25
33. PARKING..................................................................26
34. BROKERS..................................................................26
35. OPTION TO EXTEND.........................................................26
36. AMERICANS WITH DISABILITIES ACT ("ADA") AND SIMILAR ACTS.................29
37. HAZARDOUS SUBSTANCE DISCLOSURE...........................................29
38. NO REPRESENTATIONS BY LANDLORD...........................................29
39. SURRENDER................................................................30
40. LANDLORD'S LIABILITY; SALE OF BUILDING...................................30
41. MISCELLANEOUS............................................................30
EXHIBIT A-1 DESCRIPTION OF REAL PROPERTY....................................A-1
EXHIBIT A-2 PLAT OF LEVI'S PLAZA COMPLEX..................................A-2-1
EXHIBIT B FLOOR PLAN OF PREMISES............................................B-1
EXHIBIT C FORM OF NOTICE OF COMMENCEMENT DATE...............................C-1
EXHIBIT D LEVI'S PLAZA HAAS BUILDING RETAIL LEASE RULES AND REGULATIONS.....D-1
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RETAIL LEASE
THIS RETAIL LEASE ("Lease") is entered into as of this 19th day of August,
1998, by and between BLUE JEANS EQUITIES WEST, a California general partnership
("Landlord"), and BUSINESS RESOURCE GROUP, a California corporation ("Tenant").
RECITALS:
A. Landlord owns that certain real property commonly known as Levi's
Plaza, located in the City and County of San Francisco, California and more
particularly described in EXHIBIT A-1 attached hereto (together with the
Building (as described below) and any and all buildings and improvements
thereon, the "Real Property").
B. Tenant desires to lease from Landlord and Landlord desires to lease to
Tenant a portion of that certain building commonly known as the Haas Building,
which building is located at 1225 Battery Street, San Francisco, California, and
is included within Levi's Plaza and contains approximately 6,776 rentable square
feet of rentable area (as hereinafter defined).
C. As hereinafter used in this Lease, the term "Project" shall mean the
entire Levi's Plaza complex, as shown on the plat attached hereto as EXHIBIT
A-2, and the term "Building" shall mean the Haas Building.
NOW, THEREFORE, Landlord and Tenant hereby covenant and agree as follows:
1. BASIC LEASE INFORMATION
The following is a summary of basic lease information. Each term or matter
in this Article 1 shall be deemed to incorporate all of the terms set forth
hereinbelow pertaining to such matter or item and to the extent there is any
conflict between the provisions of this Article 1 and any more specific
provision of this Lease, such more specific provision shall control.
LEASE DATE: August 11, 1998
BUILDING ADDRESS: 1225 Battery Street
San Francisco, California 94111
LANDLORD: BLUE JEANS EQUITIES WEST, A CALIFORNIA GENERAL PARTNERSHIP
ADDRESS OF LANDLORD: c/o Interland-Jalson
201 Filbert Street
San Francisco, California 94111
Facsimile No: (415) 956-8097
Attention: Michael D. Franklin
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TENANT: BUSINESS RESOURCE GROUP
NOTICE ADDRESS FOR 2150 North First Street, Suite 101
TENANT: San Jose, California 95131
Fax No.: (408) 325-3288
KEY CONTACT FOR
TENANT: Tim Thomas, Controller
TELEPHONE: (408) 325-3200
FACSIMILE NO.: (408) 325-3228
SUITE AND/OR FLOORS:
(Article 2) Ground Floor
RENTABLE AREA OF
PREMISES: Approximately 6,776 rentable square feet
PARKING: N/A
(Article 33)
TERM:
(Article 3) Five (5) years, Five (5) months following the
Commencement Date.
BASE RENT: LEASE TOTAL ANNUAL MONTHLY
(Article 4) YEARS BASE RENT INSTALLMENTS
----- ------------ ------------
November 1, 1998 (the $120,002.96 $10,000.25
"Rent Commencement ($17.71 per square
Date") through foot of rentable
December 31, 2000 space)
January 1, 2001 $237,160 $19,763.33
through December 31, ($35.00 per square
2003 foot of rentable
space)
USE:
(Article 6) The retail sale of furniture and such other uses
specified in Section 6.1 below.
SECURITY DEPOSIT:
(Article 29) None
OTHER: Option to Extend (Article 35)
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2. PREMISES
Subject to the terms, covenants and conditions set forth in this Lease,
Landlord hereby leases to Tenant and Tenant hereby hires from Landlord those
premises (the "Premises") in the Building which shall be the space enclosed by
the demising walls, and which is approximately delineated on the floor plan
attached hereto as EXHIBIT B.
3. TERM; ACCEPTANCE OF THE PREMISES
3.1 The Premises are leased for a term (the "Term") commencing (the
"Commencement Date") on the earlier of (a) October 1, 1998 (the "Scheduled
Commencement Date"), or (b) the date on which Tenant first occupies all or any
portion of the Premises for the conduct of its business, and expiring on
December 31, 2003 (the "Expiration Date"). If Landlord does not tender
possession of the Premises to Tenant on or before the Scheduled Commencement
Date, for any reason whatsoever, Landlord shall not be liable for any damage
thereby, this Lease shall not be void or voidable, and Tenant shall not be
liable for rent until Landlord tenders possession of the Premises to Tenant.
In no event shall any failure by Landlord to tender possession of the Premises
on or before the Scheduled Commencement Date extend the Term of this Lease.
3.2 Promptly following the Commencement Date, Landlord will deliver to
Tenant a notice in substantially the form attached hereto as EXHIBIT C
identifying the Commencement Date, a copy of which notice shall be executed by
Tenant and promptly returned to Landlord.
3.3 Tenant hereby agrees to accept the Premises in an "As Is" condition.
Without limiting the foregoing, Tenant's rights in the Premises are subject to
all local, state and federal laws, regulations and ordinances governing and
regulating the use and occupancy of the Premises and subject to all matters now
or hereafter of record. Tenant acknowledges that neither Landlord nor
Landlord's agents have made any representation or warranty as to: (i) the
present or future suitability of the Premises for the conduct of Tenant's
business, (ii) the physical condition of the Premises, (iii) the expenses of
operation of the Premises, (iv) the safety of the Premises, whether for the use
of Tenant or any other person, including without limitation, Tenant's
employee's, agents, invitees or customers, or (v) any other matter or thing
affecting or related to the Premises. Tenant specifically agrees that Landlord
has no duty to make any disclosures concerning the fitness of the Premises for
Tenant's intended use and Tenant expressly waives any duty which Landlord may
have to make any such disclosures. Tenant shall, prior to delivery of the
Premises, inspect the Premises and become thoroughly acquainted with its
condition, and Tenant hereby acknowledges that the taking of possession of the
Premises by Tenant shall be conclusive evidence that the Premises are in good
and satisfactory condition at the time such possession is so taken.
3.4 Notwithstanding anything to the contrary contained herein, Landlord
agrees that it shall, at its sole cost and expense, remove the tile floor in
the existing kitchen of the Premises if such removal and/or remediation is
required by Tenant's initial Alterations.
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4. RENT; ADDITIONAL CHARGES
4.1 Tenant will pay to Landlord during the Term the annual Base Rent
specified in Article 1 as the same may be adjusted pursuant to Section 4.2
(herein called the "Base Rent"). Commencing on the Rent Commencement Date, the
Base Rent will be payable in equal consecutive monthly installments, as
specified in Article 1, on or before the first day of each month, in advance,
at the address specified for Landlord in Article 1, or such other place as
Landlord may designate in writing, without any prior demand and without any
deductions or setoff, except as expressly specified herein. If the Rent
Commencement Date occurs on a day other than the first day of a calendar month,
or the Expiration Date occurs on a day other than the last day of a calendar
month, then the rental for such fractional month will be prorated based on a
thirty (30) day month.
4.2 Tenant shall pay to Landlord all charges and other amounts required
under this Lease (herein called "Additional Charges") as additional rent,
including, without limitation, the charges for Taxes and Expenses as provided
for in Article 5. All such Additional Charges will be payable to Landlord as
additional rent at the place where the Base Rent is payable. Landlord will have
the same remedies for a default in the payment of any Additional Charges as for
a default in the payment of Base Rent.
4.3 If Tenant fails to pay any Base Rent or Additional Charges within
five (5) days after the date the same is due and payable, such unpaid amounts
will be subject to a late payment charge equal to the greater of five hundred
dollars ($500) or five percent (5%) of the unpaid amounts in each instance. The
late payment charge has been agreed upon by Landlord and Tenant, after
negotiation, as a reasonable estimate of the additional administrative costs
and detriment that will be incurred by Landlord as a result of any such failure
by Tenant, the actual costs thereof being extremely difficult if not impossible
to determine. The late payment charge constitute liquidated damages to
compensate Landlord for its damages resulting from such failure to pay and
shall be paid to Landlord together with such unpaid amounts. Acceptance of such
late payment charge by Landlord shall in no event constitute a waiver of
Tenant's default with respect to such overdue amount, nor prevent Landlord from
exercising any of the other rights or remedies granted under this Lease.
4.4 Any amount due to Landlord, if not paid when due, shall bear
interest from the date due until paid at the highest rate legally permitted;
provided that interest shall not be payable on late charges incurred by Tenant
nor on any amounts upon which late charges are paid by Tenant to the extent
such interest would cause the total interest to be in excess of that legally
permitted. Payment of interest shall not excuse or cure any default hereunder
by Tenant.
5. ADDITIONAL CHARGES FOR EXPENSES AND REAL ESTATE TAXES
5.1 This Lease is intended to be a net Lease; and the Base Rent owing
hereunder is to be paid by Tenant absolutely net of all costs and expenses
relating to Landlord's ownership and operation of the Building. The provisions
of this Article 5 for the payment of Tenant's Share of Taxes and Expenses are
intended to pass on to Tenant its share of all such costs and expenses.
Notwithstanding the foregoing, Tenant shall commence payment to Landlord of
Tenant's Share of Taxes and Expenses on and after January 1, 2001. The parties
hereto acknowledge that Wells
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Fargo Bank, the prior tenant in the Premises, has reimbursed Landlord for
Tenant's Share of Taxes and Expenses for the period commencing on the
Commencement Date through December 31, 2000.
For purposes of this Article 5, the following terms shall have the
meanings hereinafter set forth:
(a) "Tenant's Share" means 4.716%, i.e., the percentage corresponding to
a fraction, the numerator of which is equal to the number of rentable square
feet in the Premises and the denominator of which is equal to the number of
rental square feet in the Building, which denominator of the Lease Date is
143,651. Tenant's Share shall be adjusted by Landlord as a result of any change
in the rentable area of the Premises or the total rentable area of the Building
or the Project.
(b) "Tax Year" means each twelve (12) consecutive month period commencing
January 1st of each year during the Term, including any partial year during
which the Lease may commence; provided that Landlord, upon notice to Tenant,
may change the Tax Year from time to time to any other twelve (12) consecutive
month period and, in the event of any such change, Tenant's Tax Share of Taxes
shall be equitably adjusted for the Tax Year involved in any such change.
(c) As used in the Lease, the term "Taxes" shall mean all taxes,
assessments and charges levied upon or with respect to the Real Property or any
personal property located on the Real Property and used in the operation
thereof or upon or with respect to any ownership or possessory interest in the
Real Property or such personal property. Taxes shall include, without
limitation, all general real property taxes and general and special
assessments, charges, fees, or assessments for transit, housing, police, fire,
or the governmental services or purported benefits to the Real Property or the
occupants thereof, service payments in lieu of taxes, business taxes, and any
tax, fee, or excise on the act of entering into the Lease or any other lease of
space located on the Property, or on the use or occupancy of the Real Property
or any part thereof, or on the rent payable under any lease or in connection
with the business of renting space within the Real Property, that are now or
hereafter levied or assessed against Landlord by the United States of America,
the State of California or any political subdivision thereof, public
corporation, district, or any other political or public entity, and shall also
include any other tax, fee or other excise, however described, that may be
levied or assessed as a substitute for, or as an addition to, in whole or in
part, any other Taxes, whether or not now customary or in the contemplation of
the parties on the Commencement Date. Taxes shall also include reasonable legal
fees, costs, and disbursements incurred in connection with proceedings to
contest, determine, or reduce Taxes. In addition, as provided in Section
5.1(f), Taxes shall also include .83% of taxes levied and assessed on the
Exterior Common Areas (as defined below), which percentage represent the
Premises' allocable share of such Exterior Common Areas. Taxes shall not
include (a) franchise, transfer, inheritance, or capital stock taxes or income
taxes measured by the net income of Landlord from all sources unless, due to a
change in the method of taxation, any of such taxes is levied or assessed
against Landlord as a substitute for, or as an addition to, in whole or in
part, any other taxes that would otherwise be included within Taxes, (b)
penalties incurred, as a result of Landlord's negligence, inability or
unwillingness to make payments of, and/or to file any tax or information
returns with respect to, any Taxes, when due, (c) any Taxes directly payable by
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Tenant or any other tenant within the Building under the applicable provisions
in their respective leases,(d) any items included as Expenses, and (3) Taxes to
the extent such Taxes may be separately allocated to any underground or above
ground parking garage and/or other parking facilities associated with the
Building or to the extent such Taxes are levied on revenues from such parking
facilities.
(d) "Exterior Common Areas" shall mean those portions of the project
including, without limitation, the "Park Land" owned or controlled by Landlord
and held for the common use and benefit of the public and all tenants and owners
within the Project, all as designated and delineated on the plat attached hereto
as EXHIBIT A-2 if and so long as such areas are privately owned or controlled
and held for such mutual benefit but excluding any portion thereof devoted to
commercial or other revenue producing purposes.
(e) "Expense Year" means each twelve (12) consecutive month period
commencing January 1st of each year during the Term, including any partial year
during which the Lease may commence; provided that Landlord, upon notice to
Tenant, may change the Expense Year from time to any other twelve (12)
consecutive month period and, in the event of any such change, Tenant's Expense
Share of Expenses shall be equitably adjusted for the Expense Year involved in
any such change.
(f) Subject to the provisions of Subsection (g) below, "Expense" shall
mean and include the total costs and expenses paid or incurred by Landlord in
connection with: (i) the cost of operating, maintaining, repairing and replacing
the boiler, cooling tower and primary circulation system serving the Premises,
including without limitation, all labor and material costs related thereto, and
the cost of general maintenance, cleaning and service contracts and the cost of
all supplies, tools and equipment required in connection therewith; (ii) the
cost incurred by Landlord for all insurance carried on the Real Property or in
connection with the use and/or occupancy of the Building, including, without
limitation, the premiums and cost of fire, casualty, liability, rental abatement
and earthquake insurance applicable to the Real Property and Landlord's personal
property used in connection therewith (and all amounts paid as a result of loss
sustained that would be covered by such policies but for "deductible" or
self-insurance provisions), provided, however, that Landlord may, but shall not
be obligated to, carry earthquake insurance; (iii) management fees; (iv) a ten
percent (10%) overhead charge, and (v) .83% of the costs of operating,
maintaining and repairing the Exterior Common Areas, which percentage represents
the Premises' allocable share of the Exterior Common Areas.
Expenses that cover a period of time not within the term (including any
extended term) of the Lease shall be prorated on the basis of a 365-day year and
the actual number of days in any applicable month.
(g) If the Building is not one hundred percent (100%) occupied during all
or any portion of any Expense Year, then Landlord shall make an appropriate
adjustment, in accordance with industry standards and sound management
practices, of the Expenses and Taxes for each such Expense Year to determine
what the Expenses and Taxes would have been for such year if the Building had
been one hundred percent (100%) occupied, and the amount so determined shall be
deemed to be the amount of Expenses and Taxes for such year. Such adjustment
shall be made by Landlord by increasing those costs included in the Expenses
and/or
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Taxes which, according to industry standards and sound management practices,
vary based upon the level of occupancy of the Building.
5.2 (a) Tenant shall pay to Landlord as Additional Charges one twelfth
(1/12) of Tenant's Share of the Expenses for each Expense Year or portion
thereof during the Term, in advance, on or before the first day of each month
during such Expense Year, in an amount estimated by Landlord in a writing
delivered to Tenant. Landlord may revise such estimates from time to time and
Tenant will thereafter make payments on the basis of such revised estimates.
(b) Tenant shall pay to Landlord as Additional Charges one twelfth
(1/12) of Tenant's Share of the Taxes for each Tax Year or portion thereof
during the Term in advance, on or before the first day of each month during
such Tax Year, in an amount estimated by Landlord in a writing delivered to
Tenant. Landlord may revise such estimates from time to time, and Tenant will
thereafter make payments on the basis of such revised estimates.
5.3 With reasonable promptness after the expiration of each Expense Year
and Tax Year, including the Expense Year and Tax Year during which this Lease
terminates, Landlord will furnish Tenant with a statement (herein called
"Landlord's Expense and Tax Statement"), prepared by an independent certified
public accountant, setting forth in reasonable detail the Expenses and Taxes for
such Expense Year and Tax Year and Tenant's Share of the Taxes and Expenses,
which statement shall be conclusive and binding upon Tenant unless Tenant timely
delivers an Audit Notice (as defined in Section 5.5 below) and timely conducts
an audit, all as more particularly set forth in Section 5.5 below. If the total
of Tenant's Share of the actual Expenses and Taxes for such Expense Year and Tax
Year as set forth in Landlord's Expense and Tax Statement exceeds the total
estimated Expenses and Taxes paid by Tenant for such Expense Year and Tax Year,
Tenant shall pay to Landlord (whether or not this Lease has terminated) the
difference within thirty (30) days after the receipt of Landlord's Expense and
Tax Statement; and if the total amount paid by Tenant for any such Expense Year
and Tax Year shall exceed Tenant's Share of the actual Expenses and Taxes for
such Expense Year and Tax Year, such excess shall be credited against the next
installments of Base Rent or Expenses and Taxes due from Tenant to Landlord
hereunder, or, if this Lease has terminated and no amounts are due or to become
due to Landlord from Tenant hereunder, any excess shall be paid to Tenant by
check within thirty (30) days after such final determination of the actual
Expenses and Taxes.
5.4 If the Commencement Date or Expiration Date shall occur on a date
other than the first or last day, respectively, of a Tax Year and/or Expense
Year, Tenant's Tax Share of Taxes and/or Tenant's Expense Share of Expenses for
the Tax Year and/or Expense Year in which the Commencement Date or Expiration
Date occurs shall be prorated based on a 365-day year, but shall remain subject
to adjustment based on receipt of information after the Expiration Date.
5.5 Tenant shall have the right to audit Landlord's books and records
pertaining to the Expenses and Taxes for the immediately preceding Expense Year
and Tax Year, subject to the terms and conditions set forth in this Section
5.5. In the event that Tenant desires to exercise its audit rights hereunder,
Tenant must (i) deliver written notice (an "Audit Notice") to Landlord
exercising such rights on or before that day that is ninety (90) days after the
date (the "Statement Delivery Date") on which Tenant receives Landlord's
Expense and Tax Statement from
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Landlord and (ii) subject to delays to the extent resulting from Landlord's
scheduling requests, complete such audit and deliver written notice (a "Contest
Notice") to Landlord describing in detail any contested amounts within twelve
(12) months after the Statement Delivery Date. In the event that Tenant fails to
timely deliver an Audit Notice or Contest Notice as provided in the immediately
preceding sentence, Tenant shall be prohibited from conducting an audit or
contesting the amount of Expenses and Taxes with respect to such Expense Year
and Tax Year and Landlord's Expense and Tax Statement for such Expense Year and
Tax Year shall be conclusively binding upon Tenant. In no event whatsoever shall
Tenant have the right to audit Landlord's books and records with respect to any
Expense Year or Tax Year other than the immediately preceding Expense Year and
Tax Year. In the event that Tenant timely delivers an Audit Notice, Tenant shall
have the right, upon fifteen (15) days prior written notice to Landlord, to
conduct an audit that is reasonable in terms of scope, detail and duration of
Landlord's books and records pertaining to the Expenses and Taxes for the
immediately preceding Expense Year and Tax Year, and Landlord agrees to provide
to Tenant reasonable access to such books and records to enable Tenant to
conduct such audit. Notwithstanding the foregoing, Tenant, in conducting such
audit, agrees to accommodate reasonable scheduling requests of Landlord and to
minimize any disruption to Landlord's business operations. Tenant shall have the
right, at its sole cost and expense,and in its reasonable discretion, to make
copies of portions of such books and records, provided that in no event shall
Tenant have the right to remove such books and records from the Building's
management office. Any audit conducted by Tenant pursuant to this Section 5.5
shall be conducted by a licensed Certified Public Accounting firm approved by
Landlord (which approval shall not be unreasonably withheld or delayed) retained
by Tenant on either a fixed fee or "time and materials" basis, and under no
circumstances shall Tenant either engage any person to conduct such audit whose
compensation is determined, in whole or in part, by the amount of the recovery,
if any, received by Tenant as a result of such audit or assign to any third
person any portion of such recovery, if any. In the event that Tenant breaches
the terms of the foregoing sentence, Tenant shall thereafter be prohibited from
conducting any future audit of Expenses or Taxes throughout the Term of this
Lease. Tenant shall bear all costs of such audit, including Landlord's
incidental costs (such as, for example, overtime or additional or temporary
personnel charges or copying costs) incurred in connection with such audit;
provided, however, in the event that it is determined that there has been an
overpayment of Taxes and Expenses by Tenant by an amount of ten percent (10%) or
more, Tenant shall not be obligated to pay for the incidental costs incurred by
Landlord in connection with the audit. In the event that it is determined that
there has been an underpayment of Expenses and Taxes by Tenant for such Expense
Year and Tax Year, Tenant shall pay to Landlord, within thirty (30) days after
such determination is made, the amount of such underpayment, and, in the event
that it is determined that there has been an overpayment of Expenses and Taxes
by Tenant for such Expense Year and Tax Year, Landlord shall at its option
either (i) credit the excess to the next succeeding installment(s) of Base Rent
and Additional Charges due under this Lease or (ii) reimburse Tenant for such
overpayment within thirty (30) days after such determination is made. Any
dispute under this Section shall be resolved by arbitration before a single
arbitrator under the commercial rules of the American Arbitration Association
(or its successor) in San Francisco, California.
6. USE
Tenant shall use and continuously occupy the Premises during the Term of
this Lease solely for retail use or for such other uses as may be specified in
Article 1 and for no other use or
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uses. Tenant's use of the Premises shall in all respects and at all times comply
with applicable laws, statutes and regulations, at Tenant's sole cost and
expense.
7. CONSTRUCTION OF PREMISES; BUILDING CHANGES
Landlord reserves the right, at any time and from time to time, to make
alterations, additions, repairs or improvements to or in or to decrease the size
or area of all or any part of the Building, the fixtures and equipment therein
and the arcades, plazas and walkways outside the Building, including, without
limitation, the heating, ventilating, air-conditioning, plumbing, electrical,
fire protection, life safety, security and other mechanical, electrical and
communications systems of the Building (herein called "the Building Systems"),
the common areas and all other parts of the Building, and to change the
arrangement and/or location of entrances or passageways, doors and doorways,
corridors, elevators, stairs, toilets and other public parts of the Building,
provided that any such alterations or additions not necessitated by governmental
action shall not materially diminish the quality or quantity of services being
provided to the Premises or adversely affect the functional utilization of the
Premises.
8. ALTERATIONS
8.1 Tenant shall have the right at any time and from time to time, at
Tenant's sole cost and expense, to remodel, redecorate and make such alterations
or improvements (collectively, "Alterations") in and to the Premises as may be
necessary or proper to the continued use of the Premises by Tenant; provided,
however, that Tenant shall not, without the prior written consent of Landlord,
which consent shall not be unreasonably withheld, make any Alterations to the
Premises which: (a) will materially affect the structure or structural
components of the Building (including by way of illustration but not limitation,
the construction of interior stairwells, skylights, dumbwaiters and additional
floor supports), the heating, ventilating and air conditioning systems, or any
other mechanical, electrical or plumbing systems of the Building, (b) will be
visible from the exterior of the Building, (c) will be located outside or
underneath the Building, or (d) will lessen the fair market value of the
Building. Tenant shall be responsible for the cost of any additional alterations
and improvements (including, without limitation, structural alterations and
alterations which affect Building Systems) required by law to be made to or in
the Building as a result of any Alterations. As determined by Landlord in its
sole discretion, all Alterations shall be done by Landlord at Tenant's expense
(including hard and soft costs), in accordance with plans and specifications
approved by Landlord, and subject to all other conditions which Landlord may
reasonably impose. If Landlord does any Alterations on behalf of Tenant,
Landlord shall solicit bids from three (3) general contractors who are duly
licensed in the State of California and shall thereafter hire the lowest
responsible bidder. Tenant shall pay to Landlord upon demand an amount equal to
ten percent (10%) of the total cost of such Alterations to reimburse Landlord
for its administrative and managerial time and effort. Upon completion of any
Alterations, Tenant shall provide to Landlord at Tenant's expense "as-built"
plans and specifications.
8.2 Except as provided in Section 8.3, all appurtenances, fixtures,
improvements, equipment, additions and other property attached to or installed
in the Premises at the commencement of or during the Term shall be and remain
the property of Landlord and shall not be removed by Tenant unless requested by
Landlord.
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8.3 All furniture, furnishings and articles of movable personal property
installed in the Premises by or for the account of Tenant, without expense to
Landlord, and which can be removed without structural or other material damage
to the Building (all of which are herein called "Tenant's Property") shall be
and remain the property of Tenant and may be removed by it at any time during
the Term; provided, however, that any equipment or property for which Landlord
has granted any allowance or credit to Tenant or which is a replacement for
items originally provided by Landlord at Landlord's expense shall not be
considered Tenant's Property unless Landlord so designates. Upon review by
Landlord of the final plans for any Alterations, Landlord shall notify Tenant
which portions of the Alterations, if any, constitute Tenant's Property. Upon
the termination of this Lease, Tenant shall remove from the Premises all of
Tenant's Property, and, at the request of Landlord, Tenant shall also remove
any Alterations. Tenant shall repair or pay the cost of repairing any damage to
the Premises or to the Building resulting from such removal. Tenant's
obligations under this Section 8.3 shall survive the termination of this Lease.
Any items of Tenant's Property which shall remain in the Premises after the
termination of this Lease may, at the option of Landlord, be deemed abandoned
and in such case may either be retained by Landlord as its property or be
disposed of, without accountability, at Tenant's expense in such manner as
Landlord may see fit.
9. REPAIRS AND MAINTENANCE
9.1 Landlord will repair and maintain the structural portions of the
Building, the Building Systems, and the Exterior Common Areas, provided that
Tenant shall be obligated to reimburse Landlord for the entire cost of any
repair or maintenance if necessitated or occasioned by the acts, omissions or
negligence of Tenant, or any of its servants, employees, contractors, agents,
visitors or licensees. Tenant hereby waives and releases any right it may have
to make repairs at Landlord's expense under Sections 1941 and 1942 of the
California Civil Code or under any similar law, statute or ordinance now or
hereafter in effect.
9.2 Tenant shall, at its sole cost and expense, keep the Premises and
exterior and interior portions thereof, including without limitation, all
utilities, plumbing and sewage facilities, electric systems, mechanical
equipment, fixtures, windows, doors, and all other glass or plate glass
fixtures, in good condition and repair and in a clean, safe and sanitary
condition. Tenant shall be solely responsible for glass breakage in the
Premises, whether by vandalism or otherwise. All repairs and replacements by
Tenant shall be made and performed: (a) at Tenant's cost and expense and at
such time and in such manner as Landlord may designate, (b) by contractors or
mechanics approved by Landlord, (c) so that same shall be at least equal in
quality, value and utility to the original work or installation, and (d) in a
manner and using equipment and materials which will not interfere with or
impair the operations, use or occupation of the Building Systems, the Building
or other tenants or common areas of the Project, and (e) in accordance with the
Rules and Regulations for the Building adopted by Landlord from time to time
and all applicable laws and regulations of governmental authorities having
jurisdiction over the Premises. If Tenant fails to keep the Premises in neat,
clean, or in good condition and repair, Landlord may in its sole discretion,
enter the Premises in order to clean or repair same. Tenant shall reimburse
Landlord upon demand for any expenses incurred by Landlord in connection with
any repairs or replacements required to be made by Tenant, including, without
limitation, any fees charged by Landlord's contractors to review plans and
specifications prepared by
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Tenant, provided, however, any such payment shall not be deemed a cure of
Tenant's default and Landlord shall have all remedies available to it as
provided hereunder.
10. LIENS
Tenant shall keep the Premises free from any liens arising out of any work
performed, material furnished or obligations incurred by or for Tenant. In the
event that Tenant shall not, within ten (10) days following the imposition of
any such lien, cause the lien to be released of record by payment or posting of
a proper bond, Landlord shall have in addition to all other remedies provided
herein and by law the right but not the obligation to cause same to be released
by such means as it shall deem proper, including payment of the claim giving
rise to such lien. All such sums paid by Landlord and all expenses incurred by
it in connection therewith (including, without limitation, reasonable counsel
fees) shall be payable to Landlord by Tenant upon demand. Landlord shall have
the right at all times to post and keep posted on the Premises any notices
permitted or required by law or that Landlord shall deem proper for the
protection of Landlord, the Premises, and the Building, from mechanics' and
materialmen's liens. Tenant shall give to Landlord at least five (5) business
days' prior written notice of commencement of any repair or construction on the
Premises.
11. COMPLIANCE WITH LAWS, ENVIRONMENTAL MATTERS AND INSURANCE REQUIREMENTS
11.1 Tenant, at Tenant's cost and expense, shall comply with all laws,
orders and regulations of federal, state, county and municipal authorities
relating to the Premises or the use, improvement or occupancy thereof, except
that Tenant shall not be required to make any structural alterations in order
to comply unless such alterations shall be necessitated or occasioned, in whole
or in part, by Tenant's Alterations, or by the acts, omissions or negligence of
Tenant or its servants, employees, contractors, agents, visitors or licensees.
Any work or installations made or performed by or on behalf of Tenant or any
person or entity claiming through or under Tenant pursuant to the provisions of
this Article 11 shall be made in conformity with and subject to the provisions
of Section 9.2.
11.2 (a) As used herein, the following items shall have the following
meanings: "Environmental Activity" means any actual, proposed or threatened
use, storage, treatment, existence, release, emission, discharge, generation,
manufacture, disposal or transportation of any Hazardous Materials from, into,
on, under or about the Building or the Premises, or any other activity or
occurrence that causes or would cause any such event to exist; "Environmental
Requirements" means all present and future federal, state, regional or local
laws relating to the use, storage, treatment, existence, release, emission,
discharge, generation, manufacture, disposal or transportation of any Hazardous
Materials; and "Hazardous Material" means at any time any substances or
materials which at such time are classified or considered to be hazardous or
toxic under any Environmental Requirement.
(b) Tenant shall not engage in nor permit the occurrence of any
Environmental Activity. Tenant shall, at its own expense, procure, maintain in
effect and comply with all conditions of any and all permits, licenses, and
other governmental and regulatory approvals required under any Environmental
Requirements for any Environmental
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Activity by Tenant, including, without limitation, the discharge of
(appropriately treated) materials or wastes into or through any sanitary sewer
serving the Building or the Premises, and upon termination of this Lease
Tenant shall cause all of its Hazardous Materials to be removed from the
Building and the Premises in accordance with and in compliance with all
applicable Environmental Requirements. Upon having knowledge thereof, Tenant
shall immediately notify Landlord in writing of: any regulatory action that has
been instituted, or threatened by any governmental agency or court with respect
to Tenant that relates to any Environmental Activity; any claim relating to any
Environmental Activity by Tenant in, on or about the Building or the Premises,
or that arises out of or in connection with any Hazardous Materials in, on
under or about the Building or the Premises or removed from the Building or the
Premises; or any actual or threatened material release on, under or about the
Building or the Premises or any adjacent property of any Hazardous Material,
except any Hazardous Material whose discharge or emission is expressly
authorized by and in compliance with a permit issued by a federal, state,
regional or local governmental agency pursuant to Environmental Requirements.
Tenant shall provide Landlord with copies of any communications with federal,
state, regional or local governments, agencies or courts with respect to any
Environmental Activity or Environmental Requirement relating to the Building or
the Premises and any communications with any third party relating to any claim
made or threatened with respect to any Environmental Activity by Tenant in, on
or about the Building or the Premises. Tenant shall indemnify, defend (by
counsel reasonably acceptable to Landlord), protect, and hold Landlord and each
of Landlord's partners, employees, agents, attorneys, successors and assigns,
free and harmless from and against any and all claims, liabilities, penalties,
forfeitures, losses or expenses (including attorneys' fees) arising from or
caused in whole or in part, directly or indirectly, by (i) an Environmental
Activity by Tenant, or (ii) Tenant's failure to comply with any Environmental
Requirement. Tenant's obligations under this Section 11.2 shall include,
without limitation, and whether foreseeable or unforseeable, all costs of any
repair, damage or cleanup, removal or remediation action, or detoxification or
decontamination of the Building or the Premises, or the preparation and
implementation of any closure, remedial action or other plans in connection
therewith that are required as a result of any Environmental Activity by
Tenant, and shall survive the expiration or earlier termination of the term of
this Lease. The provisions of this Section 11.2 shall survive the termination of
this Lease. The provisions of this Section 11.2 shall survive the expiration or
sooner termination of this Lease.
11.3 Tenant shall not do anything, or permit anything to be done, in or
about the Building or the Premises which would: (a) invalidate or be in
conflict with the provisions of or cause any increase in the applicable rates
for any fire or other insurance policies covering the Project or any property
located therein; (b) result in a refusal by fire insurance companies of good
standing to insure the Project or any such property in amounts reasonably
satisfactory to Landlord; or (c) subject Landlord to any liability or
responsibility for injury to any person or property by reason of any business
operation being conducted in the Premises. Tenant, at Tenant's expense, shall
comply with all rules, orders, regulations or requirements of the American
Insurance Association (formerly the National Board of Fire Underwriters) and
with any similar body that shall hereafter perform the function of such
Association.
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12. SUBORDINATION
12.1 Without the necessity of any additional document, this Lease shall be
subject and subordinate at all times to: (a) all reciprocal easement agreements
and all ground leases or underlying leases which may now exist or hereafter be
executed affecting the Building or the Real Property or both, and (b) the lien
of any mortgage or deed of trust which may now exist or hereafter be executed
in any amount for which the Building, Real Property, ground leases or
underlying leases, or Landlord's interest or estate in any of said items, is
specified as security. Notwithstanding the foregoing, Landlord shall have the
right to subordinate or cause to be subordinated to this Lease any of the items
referred to in clause (a) or (b) above. In the event that any ground lease or
underlying lease terminates for any reason or any mortgage or deed of trust is
foreclosed or a conveyance in lieu of foreclosure is made for any reason,
Tenant shall, notwithstanding any subordination, attorn to and become the
tenant of the successor in interest to Landlord, at the option of such
successor in interest. Tenant expressly waives the effect of any current or
future statute, rule or law which may give or purport to give Tenant any right
or election to terminate the Lease if any foreclosure proceeding or sale
occurs. Tenant covenants and agrees to execute and deliver a non-disturbance
and attornment agreement, in a form reasonably acceptable to Landlord, and any
other additional documents evidencing the priority or subordination of this
Lease with respect to ground leases, underlying leases, reciprocal easement
agreements or similar documents or instruments, or the lien of any such
mortgage or deed of trust. The provisions of this Article 12 shall be
self-operative and no further instrument shall be required.
With respect to any existing mortgage indebtedness, Landlord agrees within
sixty (60) days from the date hereof to deliver to Tenant a non-disturbance
agreement in a form reasonably acceptable to Tenant, executed by the holder of
such mortgage indebtedness, and thereafter, at Tenant's request, Landlord
agrees to use its best efforts to obtain a similar agreement from any
subsequent holders of mortgage indebtedness against the Building.
12.2 The Landlord's title is and always shall be paramount to the title of
the Tenant and nothing contained in this Lease shall empower the Tenant to do
any act which can, shall or may encumber the title of the Landlord.
13. INABILITY TO PERFORM
13.1 If Landlord is unable to perform, or is delayed in performing, any
construction, installations, decorations, repairs, alterations, additions or
improvements under this Lease, or is unable to fulfill or is delayed in
fulfilling any of Landlord's other obligations under this Lease, by reason of
acts of God, accidents, breakage, repairs, maintenance, strikes, lockouts,
other labor disputes, inability to obtain utilities or materials or by any
other reason beyond Landlord's reasonable control, then no such inability or
delay by Landlord shall constitute an actual or constructive eviction, in whole
or in part, or entitle Tenant to any abatement or diminution of Base Rent or
Additional Charges, or relieve Tenant from any of its obligations under this
Lease, or impose any liability upon Landlord or its agents by reason of
inconvenience, annoyance, interruption, injury or loss to or interference with
Tenant's business or use and occupancy or quiet enjoyment of the Premises or
any loss or damage occasioned thereby. Tenant hereby
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waives and releases any right to terminate this Lease under Section 1932(1) of
the California Civil Code or under any similar law, statute or ordinance now or
hereafter in effect.
13.2 If subsequent to the Commencement Date (a) Landlord defaults in
providing any material service it is required to provide to Tenant hereunder,
(b) the providing or not providing of such service is within the control of
Landlord, (c) Tenant, upon learning of the failure by Landlord, immediately
notifies Landlord by delivering written notification to Landlord at the
locations for notices set forth in Section 24 hereof, and (d) such service is
not provided to Tenant for a period of ten (10) or more consecutive business
days after Landlord's receipt of the written notice from Tenant and the lack of
such service prevents or materially interferes with, the business carried on by
Tenant in the Premises, then, subject to the provisions of Section 17.2 hereof,
Base Rent shall abate until such service is resumed, such abatement to be based
upon the extent to which such interruption of service shall interfere with the
business carried on by Tenant in the Premises.
14. DESTRUCTION
If the Premises or the Building are damaged by fire or other casualty,
Landlord shall forthwith repair the same, provided that such repairs can be made
within one hundred eighty (180) days after the date of such damage under the
laws and regulations of the federal, state and local governmental authorities
having jurisdiction thereof. In such event, this Lease shall remain in full
force and effect except that Tenant shall be entitled to a proportionate
reduction of Base Rent and Additional Charges while such repairs to be made
hereunder by Landlord are being made. Such proportionate reduction shall be
based upon the extent to which such damage and the making of such repairs by
Landlord shall interfere with the business carried on by Tenant in the Premises.
Within sixty (60) days after the date of such damage (or as soon as reasonably
possible after such sixty (60) day period), Landlord shall notify Tenant whether
or not such repairs can be made within one hundred eighty (180) days after the
date of such damage and Landlord's determination thereof shall be binding on
Tenant. If such repairs cannot be made within one hundred eighty (180) days from
the date of such damage, Landlord shall have the option, within thirty (30) days
after the date of Landlord's notice to Tenant of such determination either to:
(i) notify Tenant of Landlord's intention to repair such damage and diligently
prosecute such repairs, in which event this Lease shall continue in full force
and effect and the Base Rent and Additional Charges shall be reduced as provided
herein; or (ii) notify Tenant of Landlord's election to terminate this Lease as
of a date specified in such notice, which date shall be not less than thirty
(30) nor more than sixty (60) days after notice is given. In the event that such
notice to terminate is given by Landlord, this Lease shall terminate on the date
specified in such notice. In case of termination, the Base Rent and Additional
Charges shall be reduced by a proportionate amount based upon the extent to
which such damage interfered with the business carried on by Tenant in the
Premises, and Tenant shall pay such reduced Base Rent and Additional Charges up
to the date of termination based upon an estimate produced by Landlord, with a
final settlement of Additional Charges to be completed after the end of the
applicable Tax Year and/or Expense Year, in accordance with Article 5 above.
Landlord agrees to refund to Tenant any Base Rent and Additional Charges
previously paid for any period of time subsequent to such date of termination.
The repairs to be made hereunder by Landlord shall not include, and Landlord
shall not be required to repair, any damage by fire or other cause to the
property of Tenant or any damage caused by the negligence of Tenant, its
contractors, agents, licensees or
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employees or any repairs or replacements of any paneling, decorations,
railings, floor coverings, or any alterations, additions, fixtures or
improvements installed on the Premises by or at the expense of the Tenant.
Tenant hereby waives the provisions of Section 1932, subdivision 2, and Section
1933, subdivision 4, of the Civil Code of California.
15. EMINENT DOMAIN
15.1 If all or any part of the Premises shall be taken as a result of the
exercise of the power of eminent domain or any transfer in lieu thereof, this
Lease shall terminate as to the part so taken as of the date of taking, and, in
the case of a partial taking, either Landlord or Tenant shall have the right to
terminate this Lease as to the balance of the Premises by written notice to the
other within thirty (30) days after such date, provided, however, that a
condition to the exercise by Tenant of such right to terminate shall be that
the portion of the Premises taken shall be of such extent and nature as
substantially to handicap, impede or impair Tenant's use of the balance of the
Premises. If any material part of the Project shall be taken as a result of the
exercise of the power of eminent domain or any transfer in lieu thereof,
Landlord shall have the right to terminate this Lease by written notice to
Tenant within thirty (30) days of the date of taking. In the event of any
taking, Landlord shall be entitled to any and all compensation, damages, income,
rent, awards, or any interest therein whatsoever which may be paid or made in
connection therewith, and Tenant shall have no claim against Landlord for the
value of any unexpired term of this Lease or otherwise; provided that Landlord
shall have no claim to any portion of the award that is specifically allocable
to Tenant's relocation expenses or the interruption of or damage to Tenant's
business. In the event of a partial taking of the Premises which does not result
in a termination of this Lease, the Base Rent and Additional Charges thereafter
to be paid shall be equitably reduced.
15.2 Notwithstanding any other provision of this Article 15, if a taking
occurs with respect to all or any portion of the Premises for a limited period
of time, this Lease shall remain unaffected thereby and Tenant shall continue to
pay Base Rent an Additional Charges and to perform all of the terms, conditions
and covenants of this Lease. In the event of any such temporary taking, Tenant
shall be entitled to receive that portion of any award which represents
compensation for the use or occupancy of the Premises during the Term up to the
total Base Rent and Additional Charges owing by Tenant for the period of the
taking, and Landlord shall be entitled to receive the balance of any award.
15.3 Tenant hereby waives and releases any right to terminate this Lease
in whole or in part under Sections 1265.120 an 1265.130 of the California Code
of Civil Procedure or under any similar law, statute or ordinance now or
hereafter in effect.
16. ASSIGNMENT AND SUBLETTING
16.1 Tenant may not directly or indirectly, voluntarily or by operation
of law, sell, assign, encumber, pledge or otherwise transfer or hypothecate all
or any part of its interest in or rights with respect to the Premises or its
leasehold estate hereunder (collectively, "Assignment"), or permit all or any
portion of the Premises to be occupied by anyone other than itself or sublet all
or any portion of the Premises (collectively, "Sublease"), or enter into license
or concession agreements, without Landlord's prior written consent in each
instance, which shall not be
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unreasonably withheld or delayed. Without limiting the circumstances in which it
may be reasonable for Landlord to withhold its consent to an assignment or
subletting, Landlord and Tenant acknowledge that it shall be reasonable for
Landlord to withhold its consent in the following instances:
(i) in Landlord's reasonable judgment, the use of the
Premises by the proposed assignee or subtenant would be other than primarily
retail, would entail any alterations which would lessen the value of the
leasehold improvements in the Premises, or would require increased services by
Landlord;
(ii) in Landlord's reasonable judgment, the financial worth
of the proposed assignee or subtenant does not meet the credit standards applied
by Landlord for other tenants under leases with comparable terms;
(iii) in Landlord's reasonable judgment, the proposed assignee
or subtenant does not have a good reputation as a tenant of property;
(iv) Landlord has experienced previous defaults by or is in
litigation with the proposed assignee or subtenant;
(v) the use of the Premises by the proposed assignee or
subtenant will violate any applicable law, ordinance or regulation;
(vi) in Landlord's reasonable judgment, the Premises, or the
relevant part thereof, will be used in a manner that will violate any negative
covenant as to use contained in any other lease of space in the Building;
(vii) the proposed assignment or sublease involves a party who
is a tenant in the Building or involves a party with whom Landlord is
negotiating for other space in the Building or with whom Landlord has negotiated
for other space in the Building during the six (6) months immediately preceding
the request for Landlord's consent;
(viii) Tenant is in default of any obligation of Tenant under
this Lease, or Tenant has defaulted under this Lease on two or more occasions
during the twelve (12) months preceding the date that Tenant shall request
consent;
(ix) in the case of a subletting of less than the entire
Premises, if the subletting would result in the division of the Premises into
more than two (2) subparcels or would require access to be provided through
space leased or held for lease to another tenant or improvements to be made
outside of the Premises; or
(x) the proposed assignee or subtenant is a government
agency.
16.2 If Tenant desires to enter into an Assignment of this Lease or a
Sublease of the Premises or any portion thereof, it shall give written notice
(herein called "Notice of Proposed Transfer") to Landlord and Landlord's
mortgagee of its intention to do so, which notice shall state the terms and
conditions under which Tenant is willing to enter into such proposed Assignment
or Sublease.
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16.3 At any time within thirty (30) days after Landlord's receipt of the
Notice of Proposed Transfer pursuant to Section 16.2, Landlord may by written
notice to Tenant elect to: (a) Sublease or take an Assignment of the portion of
the Premises specified in the Notice of Proposed Transfer, on the terms and
conditions set forth in such notice, except as otherwise provided in Section
16.4, or (b) terminate this Lease as to the portion (including all) of the
Premises that is specified in the Notice of Proposed Transfer, with a
proportionate reduction in Base Rent. If Landlord does not elect one of the
options provided in clauses (a) and (b), Tenant shall be entitled for a period
of ninety (90) days following the earlier of Landlord's notice that it will not
elect either of the options provided in clauses (a) and (b) or the expiration
of Landlord's thirty (30) day period in which to make such election, to enter
into an Assignment of Sublease of the Premises or portion thereof, subject to
Landlord's prior written approval of the proposed subtenant or assignee
(collectively, "Transferee"), which shall not be unreasonably withheld as
provided above; provided, however, that any rent or other consideration
realized by Tenant under any such Assignment or Sublease, in excess of the Base
Rent and Additional Charges payable hereunder (or the amount thereof
proportionate to the portion of the Premises subject to such Sublease or
Assignment) and reasonable commissions and reasonable attorneys' fees and the
cost of any Alterations incurred in connection with such Sublease or
Assignment, shall be divided and paid fifty percent (50%) to Landlord and fifty
percent (50%) to Tenant. Tenant shall provide Landlord with such information
regarding the proposed Transferee as Landlord may reasonably request and
Landlord agrees that it will not unreasonably withhold its approval of any
proposed Transferee. Notwithstanding the foregoing, in the event that after
Landlord has given Tenant notice that it will not elect one of the options
provided in clauses (a) and (b) or the expiration of the aforesaid thirty (30)
day period without Landlord giving such notice, Tenant desires to enter into
such Assignment or Sublease on terms and conditions materially more favorable to
Tenant than those contained in the Notice of Proposed Transfer, then Tenant
shall give Landlord a new Notice of Proposed Transfer, which notice shall state
the terms and conditions of such proposed Assignment or Sublease and identify
the proposed Transferee, and Landlord shall again be entitled to elect one of
the options provided in clauses (a) and (b) at any time within thirty (30) days
after Landlord's receipt of such new Notice of Proposed Transfer. In the event
Landlord elects either of the options provided on clauses (a) and (b), Landlord
shall be entitled to enter into a lease sublease or assignment agreement with
respect to the Premises (or portion thereof specified in said new Notice of
Proposed Transfer) with the proposed Transferee identified in Tenant's notice.
16.4 If Landlord elects to Sublease or take an Assignment from Tenant as
described in Section 16.3: (a) Landlord shall have the right to use the portion
of the Premises covered by the Notice of Proposed Transfer (the "Takeback
Space") for the use permitted hereunder, (b) the rent payable by Landlord to
Tenant shall be the lesser of that set forth in the Notice of Proposed Transfer
or the Base Rent payable by Tenant under this Lease at the time of the Sublease
or Assignment (or the amount thereof proportionate to the Takeback Space if for
less than the entire Premises), (c) Landlord may make alternations and
improvements to the Takeback Space as it shall elect and any such alternations
or improvements may be removed, in whole or in part, prior to or upon the
expiration of the Sublease, provided that any damage or injury to the Takeback
Space caused by such removal shall be repaired, (d) Landlord shall have the
right to further sublease or assign the Takeback Space to any party, without
the consent of Tenant, and (e) Tenant shall pay to Landlord on demand any costs
incurred by Landlord in physically
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separating the Takeback Space (if less than the entire Premises) from the
balance of the Premises and in complying with any applicable laws or regulations
relating to such separation.
16.5 No Sublease or Assignment by Tenant nor any consent by Landlord
thereto shall relive Tenant of any obligation to be performed by Tenant under
this Lease. Any Sublease or Assignment that is not in compliance with this
Article 16 shall be void and, at the option of Landlord, shall constitute a
material default by Tenant under this Lease. The acceptance of any Base Rent or
other payments by Landlord from a proposed Transferee shall not constitute
consent to such Sublease or Assignment by Landlord or a recognition of any
Transferee, or a waiver by Landlord of any failure of Tenant or other Transferee
to comply with this Article 16.
16.6 Each Transferee (which for purposes of this Section 16.6 shall
include without limitation, Tenant Affiliates and Tenant Successors, as defined
in Section 16.7 below), other than Landlord, shall assume all obligations of
Tenant under this Lease and shall be and remain liable jointly and severally
with Tenant for the payment of Base Rent and Additional Charges, and for the
performance of all of the terms, covenants, conditions and agreements herein
contained on Tenant's part to be performed for the Term. No Assignment shall be
binding on Landlord unless Tenant or Transferee shall deliver to Landlord a
counterpart of the Assignment and an instrument in recordable form that contains
a covenant of assumption by such Transferee satisfactory in substance and form
to Landlord, and consistent with the requirements of this Section 16.6, but the
failure or refusal of such Transferee to execute such instrument of assumption
shall not release or discharge such Transferee from its liability as set forth
above. Tenant shall reimburse Landlord on demand for any reasonable costs that
may be incurred by Landlord in connection with any proposed Sublease or
Assignment, including, without limitation, the costs of making investigations as
to the acceptability of the proposed Transferee and legal costs incurred in
connection with the granting of any requested consent.
16.7 Without limiting the above, and subject to all of the terms of
Sections 16.5 and 16.6, no consent shall be required for an Assignment or
Sublease to a Tenant Affiliate or Tenant Successor. For purposes hereof,
"Tenant Affiliate" shall mean any corporation, partnership or other entity which
controls, is controlled by or is under common control with Tenant, and "Tenant
Successor" shall mean any entity which acquires all or substantially all of the
stock or assets of Tenant or any entity into which Tenant may become merged or
consolidated, provided at the time of assignment or subleasing the Tenant
Affiliates' or Tenant Successors' then-current tangible net worth (as determined
in accordance with generally accepted accounting principles consistently
applied) equals or exceeds that of the Tenant as of the date of the execution of
this Lease, as evidenced by the then-current financial statements delivered to
Landlord and certified by a licensed Certified Public accounting firm,
reasonably approved by Landlord, with no material exceptions and no pending or
contingent claims that would materially adversely affect the net worth of such
successor corporation. "Control" in this context shall mean the right directly
or indirectly to exercise in excess of fifty percent (50%) of the voting or
governing power of an entity.
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17. UTILITIES
17.1 All water, gas, electricity, power or other public utility used upon
or furnished to the Premises and any sewer charges shall be separately metered,
as appropriate, and paid for directly by Tenant.
17.2 Landlord shall make available to the Premises electric current for
both lighting and power (excluding the central heating, air conditioning and
ventilating system) up to a connected load of 2.5 watts per rentable square
foot. Without the prior written consent of Landlord, which Landlord may refuse
in its sole discretion, Tenant shall not: (a) connect or use any electrical
equipment that exceeds the capacity of the Building electrical system; (b)
connect any apparatus, machine or device through electrical outlets except in
the manner for which such outlets are designed and without the use of any
device intended to increase the plug capacity of any electrical outlet; or (c)
maintain at any time an electrical demand load in excess of 2.5 watts.
17.3 Landlord shall not be liable for any failure or interruption for any
reason of any utility services being furnished to the Premises nor shall any
such failure or interruption entitle Tenant to terminate this Lease or withhold
Basic Rent, Additional Rent or other sums due hereunder.
18. DEFAULT
18.1 Any vacation or abandonment of more than fifty percent (50%) of the
Premises for a continuous period in excess of five (5) consecutive business
days or any failure to pay any Base Rent or Additional Charges as and when due,
or any failure to perform or comply with any covenant, condition or
representation made under this Lease (including any exhibits hereto), shall
constitute a default hereunder by Tenant, subject in the specific instances set
forth below to the expiration without cure of the appropriate grace period
hereinafter provided. Tenant shall have a period of three (3) days from the date
of receipt of written notice from Landlord within which to cure any default in
the payment of Base Rent or Additional Charges; provided, however, that
Landlord shall not be required to provide such notice regarding Tenant's
failure to make such payments when due more than once during any twelve (12)
month period, and any such failure by Tenant after Tenant has received one such
notice in any twelve (12) month period from Landlord shall constitute a default
by Tenant hereunder without any requirement on the part of Landlord to give
Tenant notice of such failure. Tenant shall have a period of ten (10) days from
the date of written notice from Landlord within which to cure any other
default under this Lease, provided, however, if the nature of such default is
such that it cannot reasonably be cured within a period of ten (10) days, then
Tenant shall have a reasonable period of time in which to cure the same if
Tenant has commenced cure within such ten (10) day period and is diligently
pursuing the remedies to cure such default.
18.2 The appointment of a receiver to take possession of all or
substantially all of the assets of Tenant, or an assignment by Tenant for the
benefit of creditors, or any action taken or suffered by Tenant under any
insolvency, bankruptcy, reorganization, moratorium or other debtor relief act
or statute, whether now existing or hereafter amended or enacted, shall also
constitute a default under this Lease by Tenant.
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18.3. Upon the occurrence of a default by Tenant which is not cured by
Tenant within the applicable grace period specified in Section 18.1, Landlord
shall have the following rights and remedies in addition to all other rights or
remedies available to Landlord at law or in equity:
(a) The rights and remedies provided by California Civil Code Section
1951.2, including, but not limited to, the right to terminate Tenant's right to
possession of the Premises and to recover the worth at the time of award of the
amount by which the unpaid Base Rent and Additional Charges for the balance of
the Term after the time of award exceeds the amount of rental loss for the same
period that the Tenant proves could be reasonably avoided, as computed pursuant
to subsection (b) of said Section 1951.2.
(b) The rights and remedies provided by California Civil Code Section
1951.4 ("Landlord may continue lease in effect after Tenant's breach and
abandonment and recover rent as it becomes due, if Tenant has right to sublet or
assign, subject only to reasonable limitations"), which allows Landlord to
continue this Lease in effect and to enforce all of its rights and remedies
under this Lease, including the right to recover rent as it becomes due, for so
long as Landlord does not terminate Tenant's right to possession; acts of
maintenance or preservation, efforts to relet the Premises or the appointment of
a receiver upon Landlord's initiative to protect its interest under this Lease
shall not constitute a termination of Tenant's right to possession. If Landlord
exercises its rights under California Civil Code Section 1951.4, Landlord as
attorney-in-fact for Tenant may from time to time sublet the Premises or any
part thereof for such term or terms (which may extend beyond the Term) and at
such rent and upon such other terms as Landlord in its sole discretion may deem
advisable, with the right to make alterations and repairs to the Premises. Upon
each such subletting, Tenant shall be immediately liable for payment to Landlord
of, in addition to Base Rent and Additional Charges due hereunder, the cost of
such subletting and such alterations and repairs incurred by Landlord and the
amount, if any, by which the Base Rent and Additional Charges owing hereunder
for the period of such subletting (to the extent such period does not exceed the
term) exceeds the amount to be paid as Base Rent and Additional Charges for the
Premises for such period pursuant to such subletting. For all purposes set forth
in this Subsection 18.3(b), Landlord is hereby irrevocably appointed
attorney-in-fact for Tenant, with power of substitution. No taking possession of
the Premises by Landlord as attorney-in-fact for Tenant shall be construed as an
election on Landlord's part to terminate this Lease or Tenant's right to
possession unless a written notice of such intention is given to Tenant. No
action taken by Landlord pursuant to this Subsection 18.3(b) shall be deemed a
waiver of any default by Tenant and, notwithstanding any such subletting without
termination, Landlord may at any time thereafter elect to terminate this Lease
for such previous default.
(c) The right to have a receiver appointed for Tenant upon
application by Landlord to take possession of the Premises and to apply any
rental collected from the Premises and to exercise all other rights and remedies
granted to Landlord as attorney-in-fact for Tenant pursuant to Subsection
18.3(b) hereof.
19. LANDLORD'S RIGHT TO CURE TENANT'S DEFAULTS
If Tenant shall default in the performance of its obligations under this
Lease, after the expiration of any applicable cure period, Landlord at any time
thereafter and without notice may remedy such default for Tenant's account and
at Tenant's expense without thereby waiving such
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default or any rights or remedies of Landlord on account of such default. Tenant
shall pay to Landlord upon demand all sums expended by Landlord, or other costs,
damages, expenses or liabilities incurred by Landlord, including, without
limitation, reasonable attorneys' fees and costs, in remedying or attempting to
remedy such default. Tenant's obligations under this Section 19.1 shall survive
the termination of this Lease.
20. MORTGAGEE PROTECTION
Tenant agrees to give any holder of any mortgage or deed of trust secured
by the Real Property, by registered or certified mail, a copy of any notice of
default served upon the Landlord by Tenant, provided that, prior to such notice,
Tenant has been notified in writing (by way of service on Tenant of a copy of
assignment of rents and leases or otherwise) of the address of such holder of a
mortgage or deed of trust. Tenant further agrees that if Landlord shall have
failed to cure such default within thirty (30) days after such notice to
Landlord (or if such default cannot be cured or corrected within that time, then
such additional time as may be necessary if Landlord has commenced within such
thirty (30) day period and is diligently pursuing the remedies or steps
necessary to cure or correct such default), then the holder of any mortgage or
deed of trust shall have an additional sixty (60) days within which to cure or
correct such default (or if such default cannot be cured or corrected within
that time, then such additional time as may be necessary if such holder of any
mortgage or deed of trust has commenced within such sixty (60) day period and is
diligently pursuing the remedies or steps necessary to cure or correct such
default). Notwithstanding the foregoing, in no event shall any holder of any
mortgage or deed of trust have any obligation to cure any default of the
Landlord.
21. INDEMNITY; TENANT'S INSURANCE
21.1 Tenant agrees to indemnify Landlord against and save Landlord harmless
from any and all loss, cost, liability, damage and expense, including, without
limitation, reasonable attorneys' fees and costs, incurred in connection with or
arising from: (i) any default by Tenant in the observance or performance of any
of the terms, covenants or conditions of this Lease on Tenant's part to be
observed or performed, or (ii) the use or occupancy or manner of use or
occupancy of the Premises by Tenant or any person or entity claiming through or
under Tenant, or (iii) the condition of the Premises or any occurrence on the
Premises from any cause whatsoever, except to the extent caused by the gross
negligence or willful misconduct of Landlord, or (iv) any acts, omissions or
negligence of Tenant or of the contractors, agents, servants, employees,
visitors, invitees or licensees of Tenant, in, on or about the Premises or the
Building. Tenant's obligations under this Section 21.1 shall survive the
termination of the Lease.
21.2 Tenant shall procure at its cost and expense and keep in effect during
the Term commercial general liability insurance, including contractual liability
with a combined single limit of liability of not less than five million dollars
($5,000,000.00), and with a deductible amount acceptable to Landlord. Such
coverage shall be in a commercial general liability form with at least the
following endorsements to the extent such endorsements are generally available:
(i) deleting any employee exclusion on personal injury coverage, (ii) including
employees as additional insureds, (iii) providing for blanket contractual
coverage, broad form property damage coverage and products completed operations
coverage (where applicable), (iv) deleting any liquor liability exclusions, and
(v) providing for coverage of employee's automobile non-
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ownership liability. Such insurance shall name Landlord, Landlord's mortgagee,
and any other party designated by Landlord as an additional insured, shall
specifically include the liability assumed hereunder by Tenant, shall provide
that it is primary insurance and not excess over or contributory with any other
valid, existing and applicable insurance covering the same loss carried by
Landlord or any other party, shall provide for severability of interests, shall
further provide that an act or omission of one of the named insureds which would
void or otherwise reduce coverage shall not reduce or void the coverage as to
any insured, shall afford coverage for all claims based on acts, omissions,
injury or damage which occurred or arose (or the onset of which occurred or
arose) in whole or in part during the policy period, and shall provide that
Landlord will receive thirty (30) days' written notice from the insurer prior to
any cancellation or change of coverage. Tenant shall deliver to Landlord
policies of such insurance satisfactory to Landlord on or before the
Commencement Date, and thereafter at least thirty (30) days before the
expiration dates of expiring policies; and in the event Tenant shall fail to
procure such insurance, or to deliver such policies, Landlord may, at its
option, procure same for the account of Tenant, and the cost thereof shall be
paid to Landlord within five (5) days after delivery to Tenant of bills
therefor. Tenant's compliance with the provisions of this Section 21.2 shall in
no way limit Tenant's liability under any provisions of Section 21.1.
21.3 Tenant shall be responsible, at its cost and expense, for separately
insuring Tenant's Property.
21.4 Notwithstanding anything to the contrary contained herein, to the
extent permitted by their respective policies of insurance and to the extent of
insurance proceeds received with respect to a loss, Landlord and Tenant each
hereby waive any right of recovery against the other party and against any other
party maintaining a policy of insurance with respect to the Project or any
portion thereof or the contents of any of the same, for any loss or damage
covered by insurance maintained by such other party with respect to the Project
or the Premises or any portion of any thereof or the contents of the same or any
operation therein, whether or not such loss is caused by the fault or negligence
of such other party. If any policy of insurance relating to the Premises carried
by Tenant does not permit the foregoing waiver or if the coverage under any such
policy would be invalidated as a result of such waiver, Tenant shall obtain from
the insurer under such policy a waiver of all rights of subrogation the insurer
might have against Landlord or any other party maintaining a policy of insurance
covering the same loss, in connection with any claim, loss or damage covered by
such policy.
22. LIMITATION OF LANDLORD'S LIABILITY
Landlord shall not be responsible for or liable to Tenant and Tenant hereby
waives all claims against Landlord for any injury, loss or damage to any person
or property in or about the Premises by or from any cause whatsoever (other than
Landlord's gross negligence or willful misconduct) including, without
limitation, acts or omissions of persons occupying adjoining premises or any
part of the Project adjacent to or connected with the Premises; theft; burst,
stopped or leaking water, gas, sewer or steam pipes; or gas, fire, smoke, paint,
polish, Environmental Activity, oil or electricity in, on or about the Premises
or the Project.
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23. ACCESS TO PREMISES
Landlord reserves (for itself and any designated agent, representative,
employee or contractor) the right to enter the Premises at all reasonable times
and, except in cases of emergency, after giving Tenant reasonable notice, to
inspect the Premises, to supply any service to be provided by Landlord
hereunder, to show the Premises to prospective purchasers, mortgagees or, during
the last year of the Term of this Lease, tenants, to post notices of
nonresponsibility, and to alter, improve or repair the Premises and any portion
of the Building, without abatement of Base Rent or Additional Charges, and may
for that purpose erect, use and maintain necessary structures in and through the
Premises where reasonably required by the character of the work to be performed,
provided that the entrance to the Premises shall not be blocked thereby, and
further provided that the business of Tenant shall not be interfered with
unreasonably. Tenant hereby waives any claim for damages for any injury or
inconvenience to or interference with Tenant's business, any loss of occupancy
or quiet enjoyment of the Premises or any other loss occasioned thereby. All
locks for all of the doors in, upon and about the Premises, excluding Tenant's
vaults and safes or special security areas (designated in advance in writing by
Tenant and approved in writing by Landlord) shall at all times be keyed to the
Building master system and Landlord shall at all times have and retain a key
with which to unlock all of said doors. Landlord shall have the right to use any
and all means that Landlord may deem necessary or proper to open said doors in
an emergency in order to obtain entry to any portion of the Premises, and any
entry to the Premises or portions thereof obtained by Landlord by any of said
means, or otherwise, shall not under any circumstances be construed or deemed to
be a forcible or unlawful entry into, or a detainer of, the Premises, or an
eviction, actual or constructive, of Tenant from the Premises or any portion
thereof.
24. NOTICES
Notices or other communications given or required to be given under this
Lease shall be effective only if rendered or given in writing, sent by certified
mail with a return receipt requested or delivered personally by a nationally
recognized overnight courier service: (a) to Tenant (i) at Tenant's address set
forth in Article 1 hereof, or (ii) at any place where Tenant or any agent,
officer or employee of Tenant may be found if sent subsequent to Tenant's
vacating, deserting, abandoning or surrendering the Premises; or (b) to Landlord
at Landlord's address set forth in Article 1; or (c) to such other address as
either Landlord or Tenant may designate as its new address for such purpose by
notice given to the other in accordance with the provisions of this Article 24.
Tenant may be required to give notice to Landlord's mortgagee pursuant to
Section 20.1 herein. Any such notice or other communication shall be deemed to
have been rendered or given two (2) days after the date when it shall have been
mailed if sent by certified mail, or upon the date personal delivery is made.
25. NO WAIVER
25.1 No failure by Landlord to insist upon the strict performance of any
obligation of Tenant under this Lease or to exercise any right, power or remedy
consequent upon a breach thereof, no acceptance of full or partial Base Rent or
Additional Charges during the continuance of any such breach, and no acceptance
of the keys to or possession of the Premises prior to the
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expiration of the Term by any employee or agent of Landlord shall constitute a
waiver of any such breach or of such term, covenant or condition or operate as
a surrender of this Lease.
25.2 Neither this Lease nor any term or provisions hereof may be
changed, waived, discharged or terminated orally, and no breach thereof shall be
waived, altered or modified, except by a written instrument signed by the party
against which the enforcement of the change, waiver, discharge or termination is
sought. No waiver of any breach shall affect or alter this Lease, but each and
every term, covenant and condition of this Lease shall continue in full force
and effect with respect to any other then-existing or subsequent breach thereof.
The consent of Landlord given in any instance under the terms of this Lease
shall not relieve Tenant of any obligation to secure the consent of Landlord in
any other or future instance under the terms of this Lease.
26. TENANT'S CERTIFICATES
Tenant, at any time and from time to time upon not less than ten (10)
days' prior written notice from Landlord, will execute, acknowledge and deliver
to Landlord or to any party designated by Landlord, a certificate or estoppel
of Tenant stating: (a) that Tenant has accepted the Premises (or, if Tenant has
not done so, that Tenant has not accepted the Premises and specifying the
reasons therefor), (b) the Commencement Date and Expiration Date of this Lease,
(c) that this Lease is unmodified and in full force and effect (or, if there
have been modifications, that same is in full force and effect as modified and
stating the modifications), (d) whether or not there are then existing any
defenses against the enforcement of ay of the obligations of Tenant under this
Lease (and, if so, specifying same), (e) whether or not there are then existing
any defaults by Landlord in the performance of its obligations under this Lease
(and, if so, specifying same), (f) the dates, if any, to which the Base Rent
and Additional Charges and other charges under this Lease have been paid, and
(g) any other information that may reasonably be required by any such person.
27. RULES AND REGULATIONS
Tenant shall faithfully observe and comply with the rules and
regulations attached to this Lease as EXHIBIT D and all modifications thereof
and additions thereto from time to time put into effect by Landlord (the "Rules
and Regulations"). Landlord shall have no duty to enforce the Rules and
Regulations against, nor shall Landlord be responsible for the nonperformance
of the Rules and Regulations by, any other tenant or occupant of the Project.
In the event of any conflict between the terms, covenants, agreements and
conditions of this Lease and the terms, covenants, agreements and conditions of
the Rules and Regulations, this Lease shall control.
28. TAXES PAYABLE BY TENANT
In addition to the Base Rent and the Additional Charges to be paid by
Tenant hereunder, Tenant agrees to pay, prior to delinquency, any and all taxes
and assessments levied or assessed or attributable during the Term hereof,
whether or not now customary or within contemplation of the parties hereto,
that are: (a) upon or measured by the Base Rent or Additional Charges payable
hereunder, including, without limitation, any gross income tax or excise tax
levied by the City, the State of California, the federal government or any other
governmental body with respect to
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the receipt of such Base Rent or Additional Charges; (b) upon or in connection
with the possession, leasing, operation, management, maintenance, alteration,
repair, use or occupancy by Tenant of the Premises or any portion thereof; (c)
upon or measured by the cost or value of Tenant's Property; or (d) upon this
transaction or any document to which Tenant is a party, creating or
transferring an interest or an estate in the Premises. If at any time any of
such taxes or assessments are levied or assessed against the Building or Real
Property, Tenant shall reimburse Landlord for all such taxes paid by Landlord.
In the event that it is not lawful for Tenant to so reimburse Landlord, the
Base Rent and the Additional Charges payable to Landlord under this Lease shall
be revised so that Landlord receives the same net Base Rent and Additional
Charges after imposition of any such tax upon Landlord, as Landlord would have
received prior to the imposition of any such tax. None of the kinds of taxes
described in this Article 28 and imposed with respect to this Lease or any
other lease of any portion of the Building shall be included within the
definition of Taxes in Article 5 of this Lease. Landlord and Tenant acknowledge
that the term "taxes" as used in this Article shall mean any levies, fees,
charges or other impositions imposed by any governmental entity. If and to
the extent that any portion of the Alterations is assessed to Landlord as a
part of the Building, Tenant shall pay to Landlord any additional taxes
actually payable by Landlord by reason of the fact that the Alterations are not
separately assessed to Tenant. For the purpose of making this allocation, the
parties shall seek access to the assessor's field notes and any other
information available to the parties, that would be helpful in making such
allocation.
29. SECURITY DEPOSIT
Landlord shall not require a security deposit.
30. AUTHORITY
Each of the persons executing this Lease on behalf of Tenant does hereby
covenant and warrant that Tenant is a duly authorized and existing entity,
that Tenant has and is qualified to do business in California, that Tenant has
full right and authority to enter into this Lease, and that each and both of
the persons signing on behalf of Tenant are authorized to do so. Upon
Landlord's request, Tenant shall provide Landlord with evidence reasonably
satisfactory to Landlord confirming the foregoing covenants and warranties.
31. PUBLIC TRANSIT INFORMATION
Tenant shall establish and carry on during the Term a program to
encourage maximum use of public transportation by personnel of Tenant employed
on the Premises, including, without limitation, the distribution to such
employees of written materials explaining the convenience and availability of
public transportation facilities adjacent or proximate to the Building and
encouraging use of such facilities, all at Tenant's sole cost and expense.
32. SIGNAGE
Tenant may affix only one (1) sign to the exterior surface of the
Premises and shall maintain any such sign in good condition and repair. Said
sign shall conform to Landlord's criteria for the size, content, design and
location thereof and shall be subject to the prior written approval of
Landlord. Tenant shall not place or maintain any signs, decal, placard,
lettering or
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advertising matter of any kind whatsoever on any exterior door, wall, window or
within the Premises if directed to or readable by people standing outside the
Premises without the prior written consent of Landlord. Tenant's signage within
the Premises shall be professionally made and mounted and shall have no flashing
or moving components. Tenant shall not place any fixture, display or sign within
the Premises which in the opinion of Landlord is objectionable and contrary to
the best interests of the Project or which effectively modifies the approved
storefront appearance of the Premises. Upon the request of Landlord, Tenant
shall immediately remove any sign, lettering or other material which Tenant has
placed or permitted to be placed in, on, or about the Premises contrary to the
provisions of this Article 32, and if Tenant fails to do so, Landlord may enter
upon the Premises and remove the same at Tenant's expense. In the event that
Landlord adopts and furnishes to Tenant uniform rules and regulations relating
to signage and advertising material which are to be applicable to all tenants
occupying retail space in the Project, Tenant agrees to conform to such rules.
33. PARKING
[Intentionally Deleted].
34. BROKERS
Neither Tenant nor Landlord have had any contact or dealings regarding the
leasing of the Premises, or any communication in connection with the subject
matter of this transaction, through any real estate broker or other person who
can claim a right to a commission or finder's fee in connection with the lease,
except for a commission payable to Forst and Associates, Inc. ("Broker"), whose
commission shall be by Landlord pursuant to a separate agreement between
Landlord and Broker. In the event that any other broker or finder makes a claim
for a commission or finder's fee based upon any such contract, dealings or
communication, the party whose conduct is the basis for the broker or finder
making its claim shall be responsible for said commission or fee and all costs
and expenses (including reasonable attorneys' fees) incurred by the other party
in defending against the same.
35. OPTION TO EXTEND
35.1 So long as Tenant, a Tenant Affiliate or a Tenant Successor subject to
all the terms and conditions of Section 16.5 and 16.6 above, occupies the entire
Premises, Tenant shall have one option ("Extension Option") to extend the term
of this Lease with respect to the entirety of the Premises for a period of five
(5) years from the Expiration Date (the "Extension Period"), subject to the
following conditions:
(a) The option to extend shall be exercised, if at all, by notice of
exercise given to Landlord by Tenant not more than fifteen (15) months nor less
than twelve (12) months prior to the Expiration Date.
(b) Tenant shall accept the Premises on an "AS-IS" basis.
(c) Anything herein to the contrary notwithstanding, if Tenant is in
default under any of the terms, covenants or conditions of this Lease, either at
the time Tenant exercises the Extension Option or on the commencement date of
the Extension Period, Landlord shall
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have, in addition to all of Landlord's other rights and remedies provided in
this Lease, the right to terminate this option to extend upon notice to Tenant.
35.2 In the event the Extension Option is exercised in a timely fashion,
the Lease shall be extended for the Term of the Extension Period upon all of the
terms and conditions of this Lease, provided that the Base Rent for the
Extension Period shall be the "Fair Market Rent" for the Premises. For purposes
hereof, "Fair Market Rent" shall mean one hundred percent (100%) of the then
prevailing rental rate per square foot, including, without limitation, base
rent, additional rent and all other monetary payments and escalations, agreed to
be paid by new and renewal tenants generally for first floor retail space
located in first-class office buildings in the San Francisco financial
district in a condition (including the state of build out) and location (within
the Building and any comparison buildings) comparable to the Premises for
comparable terms, pursuant to new and renewal leases entered into by such other
tenants for substantially comparable-size space, and considering the age and
amenities of any comparison buildings, but in no event considering any tenant
improvement allowances or similar items granted in connection with new and
renewal leases. In no event, however, shall any adjustment of Base Rent pursuant
to this Section result in a decrease of the Base Rent and Additional Changes for
the Premises below the amount due from Tenant for the final year of the Term.
35.3 Not later than six (6) months prior to the Expiration Date, Landlord
shall notify Tenant in writing of Landlord's estimate of the Base Rent for the
Extension Period, based on the provisions of Section 35.2 above. Within thirty
(30) days after receipt of such notice from Landlord, Tenant shall have the
right either to (a) accept Landlord's statement of Base Rent as the Base Rent
for the Extension Period; or (b) elect to arbitrate Landlord's estimate of Fair
Market Rent, such arbitration to be conducted pursuant to the provisions hereof.
Failure on the part of Tenant to require arbitration of Fair Market Rent within
such thirty (30) day period shall constitute acceptance of the Base Rent for the
Extension Period as calculated by Landlord. If Tenant elects arbitration, the
arbitration shall be concluded within ninety (90) days after the date of
Tenant's election, subject to extension for an additional thirty (30) day period
if a third arbitrator is required and does not act in a timely manner. To the
extent that arbitration has not been completed prior to the expiration of any
preceding period for which Base Rent has been determined, Tenant shall pay Base
Rent at the rate calculated by Landlord, with an adjustment to be made once Fair
Market Rent is ultimately determined by arbitration.
35.4 In the event of arbitration, the judgment or the award rendered in any
such arbitration may be entered in any court having jurisdiction and shall be
final and binding between the parties. The arbitration shall be conducted and
determined in the City and County of San Francisco in accordance with the then
prevailing rules of the American Arbitration Association or its successor for
arbitration of commercial disputes except to the extent that the procedures
mandated by said rules shall be modified as follows:
(a) Tenant shall make demand for arbitration in writing within thirty
(30) days after service of Landlord's determination of Fair Market Rent given
under Section 35.3 above, specifying therein the name and address of the person
to act as the arbitrator on its behalf. The arbitrator shall be qualified as a
real estate appraiser with at least ten (10) years experience or a real estate
broker with at least ten (10) years experience and otherwise familiar with the
Fair Market Rent of first floor retail space located in first-class buildings in
the San Francisco
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financial district who would qualify as an expert witness over objection to
give opinion testimony addressed to the issue in a court of competent
jurisdiction. Failure on the part of Tenant to make a proper demand in a timely
manner for such arbitration shall constitute a waiver of the right thereto.
Within fifteen (15) days after the service of the demand for arbitration,
Landlord shall give notice to Tenant, specifying the name and address of the
person designated by Landlord to act as arbitrator on its behalf who shall be
similarly qualified.
(b) In the event that two arbitrators are chosen pursuant to Section
35.4(a) above, the arbitrators so chosen shall, within fifteen (15) days after
the second arbitrator is appointed, determine the Fair Market Rent. If the two
arbitrators shall be unable to agree upon a determination of Fair Market Rent
within such fifteen (15) day period, they, themselves, shall appoint a third
arbitrator, who shall be a competent and impartial person with qualifications
similar to those required of the first two arbitrators pursuant to Section
35.4(a). In the event they are unable to agree upon such appointment within
seven (7) days after expiration of said fifteen (15) day period, the third
arbitrator shall be selected by the parties themselves, if they can agree
thereon, within a further period of fifteen (15) days. If the parties do not so
agree, then either party, on behalf of both, may request appointment of such a
qualified person by the then Chief Judge of the United States District court
having jurisdiction over the City and County of San Francisco, acting in his
private and not in his official capacity, and the other party shall not raise
any question as to such Judge's full power and jurisdiction to entertain the
application for and make the appointment. The three arbitrators shall decide
the dispute if it has not previously been resolved by following the procedure
set forth below.
(c) When an issue cannot be resolved by agreement between the two
arbitrators selected by Landlord and Tenant or settlement between the parties
during the course of arbitration, the issue shall be resolved by the three
arbitrators within fifteen (15) days of the appointment of the third arbitrator
in accordance with the following procedure. The arbitrator selected by each of
the parties shall state in writing his determination of the Fair Market Rent
supported by the reasons therefor with counterpart copies to each party. The
arbitrators shall arrange for a simultaneous exchange of such proposed
resolutions. The role of the third arbitrator shall be to select which of the
two proposed resolutions most closely approximates his determination of Fair
Market Rent. The third arbitrator shall have no right to propose a middle
ground or any modification of either of the two proposed resolutions. The
resolution he chooses as most closely approximating his determination shall
constitute the decision of the arbitrators and be final and binding upon the
parties.
(d) In the event of a failure, refusal or inability of any arbitrator
to act, his successor shall be appointed by him, but in the case of the third
arbitrator, his successor shall be appointed in the same manner as provided for
appointment of the third arbitrator. The arbitrators shall decide the issue
within fifteen (15) days after the appointment of the third arbitrator. Any
decision in which the arbitrator appointed by Landlord and the arbitrator
appointed by Tenant concur shall be binding and conclusive upon the parties.
Each party shall pay the fee and expenses of its respective arbitrator and both
shall share the fee and expenses of the third arbitrator, if any, and the
attorneys' fees and expenses of counsel for the respective parties and of
witnesses shall be paid by the respective party engaging such counsel or
calling such witnesses.
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(e) The arbitrators shall have the right to consult experts and
competent authorities to obtain factual information or evidence pertaining to a
determination of Fair Market Rent, but any such consultation shall be made in
the presence of both parties with full right on their part to cross-examine. The
arbitrators shall render their decision and award in writing with counterpart
copies to each party. The arbitrators shall have no power to modify the
provisions of this Lease.
36. AMERICANS WITH DISABILITIES ACT ("ADA") AND SIMILAR ACTS.
Notwithstanding anything to the contrary contained herein or in the Lease,
Tenant, at its sole cost and expense, shall (i) cause all alterations,
additions, improvements and repairs to the Premises to comply with the
provisions of the ADA, Title 24 of the California Administrative Code, and other
similar federal, state, and local laws and regulations, including, without
limitation, any alterations required under the ADA for the purposes of "public
accommodations" (as that term is used in the ADA), and (ii) reimburse Landlord
upon demand for any and all costs and expenses incurred by Landlord to comply
with ADA, Title 24, or such similar federal, state, or local laws and
regulations in any other portion of the Building in which the Premises are
located arising out of Tenant's use of or construction in the Premises. Except
as provided above, Tenant shall have no responsibility to comply with such laws
in portions of the Building outside of the Premises, but rather Landlord,at its
sole cost and expense, shall be responsible for such compliance in the common
areas of the Building and the Project.
37. HAZARDOUS SUBSTANCE DISCLOSURE.
California law requires landlords to disclose to tenants the existence of
certain Hazardous Materials. Accordingly, the existence of gasoline and other
automotive fluids, asbestos containing materials, maintenance fluids, copying
fluids and other office supplies and equipment, certain construction and finish
materials, tobacco smoke, cosmetics and other personal items must be disclosed.
Gasoline and other automotive fluids are found in the garage areas of the
Project. Cleaning, lubricating and hydraulic fluids used in the operation and
maintenance of the Building are found in the utility areas of the Building not
generally accessible to Building occupants or the public. Many Building
occupants use copy machines and printers with associated fluids and toners, and
pens, markers, inks, and office equipment that may contain Hazardous Materials.
Certain adhesives, paints and other construction materials and finishes used in
portions of the Building may contain Hazardous Materials. The Building may from
time to time be exposed to tobacco smoke. Building occupants and other persons
entering the Building from time to time may use or carry prescription and
non-prescription drugs, perfumes, cosmetics and other toiletries, and foods and
beverages, some of which may contain Hazardous Materials. By its execution of
this Lease, Tenant acknowledges that the notice set forth hereinabove shall
constitute the notice required under California Health and Safety Code Section
25915.5.
38. NO REPRESENTATIONS BY LANDLORD
Landlord and Landlord's agents have made no representations, warranties or
promises, express or implied with respect to the condition of the Real Property,
the Premises, the existing fixtures or the Building Systems serving the Premises
or as to any other thing or fact related
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thereto except as herein expressly set forth, and no rights, easements or
licenses are acquired by Tenant by implication or otherwise except as expressly
set forth herein.
39. SURRENDER
Tenant shall at the end of the Term surrender to Landlord the Premises and
all alterations, additions and improvements thereto in broom clean condition and
otherwise in the same condition as when received, ordinary wear and tear and
damage due to casualty excepted (other than to the extent Tenant is required to
repair such condition). Subject to Landlord's right to require removal pursuant
to Section 8.3 above, all improvements installed in the Premises by Tenant,
shall, without compensation to Tenant, then become Landlord's property free and
clear of all claims to or against them by Tenant or any third person, and Tenant
shall defend and indemnify Landlord against all liability and loss arising from
such claims or from Landlord's exercise of the rights conferred by this Article
39. Tenant shall, upon request by Landlord, remove all or any portion of the
communications and data wiring and cabling installed by or for the benefit of
Tenant in or about the Premises or the Building and repair and restore the
Premises in respect of any damage caused by such removal.
40. LANDLORD'S LIABILITY; SALE OF BUILDING.
The term "Landlord," as used in this Lease, shall mean only the owner or
owners of the Building at the time in question. Tenant acknowledges and agrees
that the liability of Landlord with respect to its obligations under this Lease,
or arising in connection with the ownership, operation, management, leasing,
repair, renovation, alteration or any other matter relating to the Building or
the Premises, is limited to Landlord's interest in the Building, and Tenant
agrees to look solely to Landlord's interest in the Building to satisfy any
claim or judgment against or any liability or obligation of Landlord to Tenant
under this Lease. In no event shall any partner, officer, director, employee,
trustee, beneficiary, advisor, investment manager, manager, agent, member,
advisor, or shareholder of Landlord have any personal liability to Tenant with
respect to any liability or obligation of Landlord to Tenant, and no recourse
shall be had by Tenant against any such parties or the assets of any such
parties to satisfy any claim or judgment of Tenant for Landlord's breach of any
of its obligations under this Lease. In addition, in the event of any conveyance
of title to the Building, Landlord shall be relieved of all liability with
respect to Landlord's obligations to be performed under this Lease after the
date of such conveyance.
41. MISCELLANEOUS
41.1 The words "Landlord" and "Tenant" as used herein shall include the
plural as well as the singular. If there is more than one Tenant, the
obligations under this Lease imposed on Tenant shall be joint and several. The
captions preceding the articles of this Lease have been inserted solely as a
matter of convenience and such captions in no way define or limit the scope or
intent of any provision of this Lease.
41.2 The terms, covenants and conditions contained in this Lease shall bind
and inure to the benefit of Landlord and Tenant and, except as otherwise
provided herein, their respective personal representatives and successors and
assigns; provided, however, that upon the sale, assignment or transfer by
Landlord named herein (or by any subsequent landlord) of its interest
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in the Building as owner or Tenant, including any transfer by operation of law,
Landlord (or any subsequent landlord) shall be relieved from all subsequent
obligations and liabilities arising under this Lease subsequent to such sale,
assignment or transfer.
41.3 If any provision of this Lease or the application thereof to any
person, entity or circumstance shall, to any extent, be invalid or
unenforceable, the remainder of this Lease, or the application of such
provision to persons, entities or circumstances other than those as to which it
is invalid or unenforceable, shall not be affected thereby, and each provision
of this Lease shall be valid and be enforced to the full extent permitted by
law.
41.4 This Lease shall be construed and enforced in accordance with the
laws of the State of California.
41.5 This instrument, including the exhibits hereto, which are made a
part of this Lease, contains the entire agreement between the parties and all
prior negotiations and agreements are merged herein. Tenant hereby
acknowledges that neither Landlord nor Landlord's agents have made any
representations or warranties with respect to the Premises, the Building or
this Lease except as expressly set forth herein, and no rights, easements or
licenses are or shall be acquired by Tenant by implication or otherwise unless
expressly set forth herein.
41.6 In the event that either Landlord or Tenant fails to perform any of
its obligations under this Lease or in the event a dispute arises concerning
the meaning or interpretation of any provision of this Lease, the defaulting
party or the party not prevailing in such dispute, as the case may be, shall
pay any and all costs and expenses incurred by the other party in enforcing or
establishing its rights hereunder, including, without limitation, court costs
and reasonable counsel fees.
41.7 Tenant covenants and agrees that no diminution of light, air or
view by any structure that may hereafter be erected (whether or not by
Landlord) shall entitle Tenant to any reduction of the Base Rent or Additional
Charges under this Lease, result in any liability of Landlord to Tenant, or in
any other way affect this Lease or Tenant's obligations hereunder.
41.8 Any holding over after the expiration of the Term without Landlord's
prior written consent shall: (a) constitute a default by Tenant; (b)
automatically increase the Base Rent and estimated Taxes and Expenses to two
hundred percent (200%) of the monthly amounts for such items payable by Tenant
hereunder prior to such expiration, together with an amount estimated by
Landlord for any other Additional Charges payable under this Lease; and (c)
entitle Landlord to exercise any or all of its remedies as provided in Article
18 hereof, notwithstanding that Landlord may elect to accept one or more
payments of Base Rent and Additional Charges from Tenant.
41.9 Except as provided in Article 13 hereof, time is of the essence in
respect of all provisions of this Lease in which a definite time for
performance is specified.
41.10 The term "gross negligence" as used in this Lease shall mean "any
action or inaction taken with a reckless disregard for the consequences".
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41.11 WAIVER OF TRIAL BY JURY. THE RESPECTIVE PARTIES HERETO SHALL AND
THEY HEREBY DO WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
BROUGHT BY EITHER OF THE PARTIES HERETO AGAINST THE OTHER UNDER THIS LEASE. IF
LANDLORD COMMENCES ANY SUMMARY PROCEEDING AGAINST TENANT, TENANT WILL NOT
INTERPOSE ANY COUNTERCLAIM OF WHATEVER NATURE OR DESCRIPTION IN ANY SUCH
PROCEEDING (UNLESS FAILURE TO IMPOSE SUCH COUNTERCLAIM WOULD PRECLUDE TENANT
FROM ASSERTING IN A SEPARATE ACTION THE CLAIM WHICH IS THE SUBJECT OF SUCH
COUNTERCLAIM), AND WILL NOT SEEK TO CONSOLIDATE SUCH PROCEEDING WITH ANY OTHER
ACTION WHICH MAY HAVE BEEN OR WILL BE BROUGHT IN ANY OTHER COURT BY TENANT.
41.12 Buyer hereby acknowledges that it understands that Wells Fargo Bank
is a party to a lease with Landlord for the Premises which has an expiration
date of January 1, 2001 (the "Wells Lease"). Notwithstanding anything to the
contrary contained herein, the effectiveness of this Lease is expressly
conditioned upon the execution by Landlord and Wells Fargo Bank of a
termination agreement for the termination of the Wells Lease and the effective
termination of the Wells Lease prior to the Commencement Date hereof.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease the day
and year first above written.
LANDLORD: BLUE JEANS EQUITIES WEST,
a California general partnership
By: /s/ [SIG]
------------------------------
Its: Partner
-----------------------------
TENANT: BUSINESS RESOURCE GROUP,
a California corporation
By: /s/ [SIG]
------------------------------
Its: V.P. Finance
-----------------------------
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36
LIST OF EXHIBITS
Exhibit A-1 Description of Real Property
Exhibit A-2 Plat of Levi's Plaza
Exhibit B Floor Plan of Premises
Exhibit C Notice of Commencement Date
Exhibit D Building Rules and Regulations
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EXHIBIT A-1
DESCRIPTION OF REAL PROPERTY
A-1
38
EXHIBIT A-1
The following describes the property outlined on Exhibit "A-1":
Parcel 1:
Lots 5, 6 and 7 as shown on the Map entitled, "PARCEL MAP OF BLOCK 'B', LEVI'S
PLAZA, SAN FRANCISCO, CALIFORNIA, BEING A SUBDIVISION OF REAL PROPERTY ON A
PORTION FIFTY VARA BLOCK NO. 27, ALSO BEING ASSESSOR'S BLOCK 84", recorded
April 20, 1979, in the office of the Recorder of the City and County of San
Francisco, State of California, in Book 10 of Parcel Maps at page 50.
Parcel 2:
BEGINNING at the point of intersection of the southerly line of Greenwich
Street with the easterly line of Battery Street; running thence easterly along
said line of Greenwich Street 102 feet and 8 inches to the southwesterly line
of the Embarcadero, so-called; thence southeasterly along the southwesterly
line of the Embarcadero 306 feet and 11-5/8 inches to the northerly line of
Filbert Street; thence westerly along said northerly line of Filbert Street 238
feet and 1 inch to the easterly line of Battery Street; thence at a right angle
northerly along said easterly line of Battery Street 275 feet to the point of
beginning.
BEING a portion of 50 Vara Block No. 13.
Parcel 3:
BEGINNING at the point of intersection of the easterly line of Battery Street
and the northerly line of Union Street; running thence easterly and along said
line of Union Street 275 fee and 0-1/2 inches to the westerly line of Front
Street; thence at a right angle northerly and along said line of Front Street
275 feet to the southerly line of Filbert Street; thence at a right angle
westerly and along said line of Filbert Street 275 feet and 0-1/2 inches to the
easterly line of Battery Street; thence at a right angle southerly and long
said line of Battery Street 275 feet to the point of beginning.
BEING 50 Vara Black No. 14.
Parcel 4:
Lots 7 and 8 as shown on the Map entitled, "PARCEL MAP OF BLOCK 'A', LEVI'S
PLAZA, SAN FRANCISCO, CALIFORNIA, BEING A SUBDIVISION OF REAL PROPERTY ON A
PORTION FIFTY VARA BLOCK NO. 28, ALSO BEING ASSESSOR'S BLOCK 107", recorded
April 20, 1979, in the office of the Recorder of the City and County of San
Francisco, State of California, in Book 10 of Parcel Maps at page 49.
Leasehold estates in Seawall lots Nos. 319 and 320.
All right, title and interest that Lessor may have in the public streets
adjacent to the foregoing properties.
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EXHIBIT A-2
PLAT OF LEVI'S PLAZA COMPLEX
A-2-1
40
EXHIBIT A-2
[LANDSCAPE PLAN]
41
EXHIBIT B
FLOOR PLAN OF PREMISES
B-1
42
EXHIBIT B
[LEVI'S PLAZA FLOOR PLAN]
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EXHIBIT C
FORM OF NOTICE OF COMMENCEMENT DATE
THIS MEMORANDUM OF COMMENCEMENT DATE is executed as of the __ day of _____,
199__, by and between BLUE JEANS EQUITIES WEST, a California general partnership
("Landlord") and BUSINESS RESOURCE GROUP, a California corporation ("Tenant").
R E C I T A L S
A. Landlord and Tenant entered into that certain Retail Lease ("Lease"),
dated as of July 24, 1998, pursuant to which Landlord leased to Tenant, and
Tenant leased from Landlord, a portion of that certain building commonly known
as the Haas Building, which building is located at 1225 Battery Street, San
Francisco, California, and more particularly described in the Lease.
B. Section 3.2 of the Lease requires Landlord and Tenant to execute a
memorandum identifying the Commencement Date of the original Term. Any terms
not defined herein shall have the meaning set forth in the Lease.
NOW, THEREFORE, the parties hereby agree as follows:
1. The Commencement Date of the original Term of the Lease is
____________, 199_.
2. The Expiration Date of the original Term of the Lease is __________,
200_.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Memorandum the
day and year first above written.
LANDLORD: BLUE JEANS EQUITIES WEST,
a California general partnership
By: ____________________________
Its: ___________________________
TENANT: BUSINESS RESOURCE GROUP,
a California corporation
By: ____________________________
Its: ___________________________
C-1
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EXHIBIT D
LEVI'S PLAZA
HAAS BUILDING
RETAIL LEASE
RULES AND REGULATIONS
D-1
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EXHIBIT D
LEVI'S PLAZA
HAAS BUILDING RETAIL LEASE
RULES AND REGULATIONS
1. Landlord shall have the right to control and operate the
public portions of the Building, the Project and public facilities, as well as
facilities furnished for the common use of the tenants, in such manner as it
deems best for the benefit of the tenants generally. No tenant shall invite to
its demised premises, or permit the visit of, persons in such numbers or under
such conditions as to interfere with the use and enjoyment of the entrances,
corridors, elevators and facilities of the Building by other tenants.
2. Landlord reserves the right to close and keep locked all
entrance and exit doors of the Building outside of normal business hours as
Landlord may deem to be advisable for the protection of the property. All
tenants, their employees, or other persons entering or leaving the Building at
any time when it is so locked may be required to sign the Building register
when so doing, and the watchman in charge may refuse to admit to the Building
while it is so locked Tenant or any of Tenant's employees, or any other person,
without a pass previously arranged, or other satisfactory identification
showing his right of access to the Building at such time. Landlord assumes no
responsibility and shall not be liable for any damage resulting from any error
in regard to any such pass or identification, or from the admission of any
unauthorized person to the Building.
3. Landlord reserves the right to exclude or expel from the
Building any person who, in the judgment of Landlord, is intoxicated or under
the influence of liquor or drugs, or who shall in any manner do any act in
violation of any of the Rules and Regulations of the Building or in violation
of any law, order, ordinance, or governmental regulation.
4. The entries, corridors, stairways and elevators shall not be
obstructed by any tenant, or used for any other purpose than ingress or egress
to and from its respective officers. Tenant shall not bring into or keep
within the Building any animal or vehicle without the prior written consent of
the Landlord.
5. No tenant shall obtain or accept for use in its demised
premises, ice, coffee service, catering, drinking water, barbering or
bootblacking from any person not authorized by landlord in writing to furnish
such services.
6. Freight, furniture, business equipment, merchandise and bulky
matter of any description ordinarily shall be delivered to and removed from the
Premises only in the freight elevator and through the service entrances and
corridors, but special arrangements will be made for moving large quantities or
heavy items of furniture, equipment and supplies into or out of the Building,
7. All entrance doors in the Premises shall be left locked when
the Premises are not in use.
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8. Tenant shall not attach or permit to be attached additional
locks or similar devices to any door, transom or window of the Premises; change
existing locks or the mechanism thereof; or make or permit to be made any keys
for any door thereof other than those provided by Landlord. (If more than
two keys for one lock are desired Landlord will provide them upon payment
therefor by Tenant.)
9. Canvassing, soliciting or peddling in the Building is
prohibited and each tenant shall cooperate to prevent the same.
10. Tenant shall not advertise the business, profession or
activities of Tenant in any manner which violates the letter or spirit of any
code of ethics adopted by any recognized association or organization pertaining
thereto or use the name of the Building for any purpose other than that of the
business address of Tenant.
11. Except as otherwise provided in this Lease, no sign, placard,
picture, name, advertisement or notice, visible from the exterior or any
tenant's premises shall be inscribed, painted, affixed, or otherwise displayed
by any tenant on any part of the Building without the prior written consent of
Landlord. If Landlord shall have given such consent at any time, such consent
shall be deemed to relate only to the particular sign, placard, picture, name,
advertisement or notice so consented to by Landlord and shall not be construed
as dispensing with the necessity of obtaining specific written consent of
Landlord with respect to each and every other sign, placard, picture, name,
advertisement or notice. Landlord may adopt and furnish to Tenant general
guidelines relating to signs in and on the Building. Tenant agrees to conform to
such guidelines, but may request approval of Landlord for modifications, which
approval will not be unreasonably withheld. All approved signs or lettering on
doors shall be printed, painted, affixed or inscribed at the expense of the
Tenant by a person approved by Landlord, which approval will not be unreasonably
withheld.
12. The directory of the Building will be provided for the
display of the name and location of Tenants, any Affiliate of any tenant, as
defined in the respective leases, and a reasonable number of the principal
officers and employees of such persons, and Landlord reserves the right to
exclude any other names therefrom. Any additional name which Tenant shall
desire to place upon said directory must first be approved by Landlord, and, if
so approved, a charge will be made therefor.
13. The drinking fountains, lavatories, water closets and urinals
shall not be used for any purpose other than those for which they were
installed.
14. No awnings or other projections over or around the windows or
entrances of the demised premises shall be installed by any tenant. No curtains,
blinds, shares or screens shall be attached to or hung in, or used in connection
with any window or door of the demised premises without the prior written
consent of the Landlord. Tenant shall not make any changes which will alter the
Building's appearance from the outside of the Building without prior written
consent of the landlord.
15. Rooms or other areas used in common by tenants shall be
subject to such regulations as are posted therein.
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16. Landlord is not responsible to any tenant for the nonobservance or
violation of the Rules and Regulations by any other tenant.
17. Landlord reserves the right by written notice to Tenant, to
rescind, alter or waive any rule or regulation at any time prescribed for the
Building when, in Landlord's judgment, it is necessary, desirable or proper for
the best interest of the Building and its tenants. Waiver by Landlord shall not
be construed as a waiver of such Rules and Regulations in favor of any other
tenant or tenants, and shall not prevent Landlord from thereafter enforcing any
such Rules and Regulations against any or all of the tenants of the Building.
18. Tenant shall not exhibit, sell or offer for sale on the Premises
or in the Building any article or thing except those articles and things
essentially connected with the stated use of the Premises by Tenant without the
advance consent of the Landlord. Nor shall any tenant carry on, or permit or
allow any employee or other person to carry on, the business of stenography,
typewriting or any similar business in or from a demised premises for the
service or accommodation of occupants of any other portion of the Building, nor
shall the premises of any tenant be used for manufacturing of any kind, or any
business or activity other than that specifically provided for in such tenant's
lease.
19. Tenant shall never use any picture or likeness of the Building in
any circulars, notices, advertisements or correspondence without the Landlord's
consent.
20. Tenant shall cooperate fully with the Landlord to assure the
effective operation of the Building's air conditioning system. If Tenant shall
so use the Premises that noxious or objectionable fumes, vapors and odors exist
beyond the extent to which they are discharged or eliminated by means of the
flues and other devices contemplated by the various plans, specifications and
leases, then Tenant shall provide proper ventilating equipment for the
discharge of such excess fumes, vapors and odors so that they shall not enter
into the air conditioning system or be discharged into other vents or flues of
the Building or annoy any of the tenants of the building or adjacent
properties. The design, location and installation of such equipment shall be
subject to Landlord's prior written approval.
21. The Premises shall not be used for the storage of merchandise held
for sale to the general public or for lodging. No cooking shall be done or
permitted by Tenant on the Premises except in that area or those areas in which
cooking and food preparation facilities are installed and operated under,
pursuant to, and in accordance with, all applicable Federal, State and City
laws, codes, ordinances, rules and regulations. The operation of any food
service facility by Tenant or a concessionaire of Tenant shall be restricted to
use by employees of the Tenant and any Affiliate thereof and their invited
guests and shall not be available for use by the general public. Use by Tenant
of Underwriters' Laboratory approved equipment for brewing coffee, tea, hot
chocolate and similar beverages shall be permitted in areas other than those
specifically designated for food service, provided that such use is in
accordance with all applicable Federal, State and City laws, codes, ordinances,
rules and regulations.
22. All loading and unloading of merchandise, supplies, materials,
garbage and refuse shall be made only through such entryways and elevators and
at such times as the Landlord shall designate. In its use of the loading areas
in the basement, Tenant shall not
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obstruct or permit the obstruction of said loading area and at no time shall
park or allow its officers, agents or employees to park vehicles therein except
for loading or unloading.
23. There shall not be used or kept anywhere in the Building by any
tenant or persons or firms visiting or transacting business with a tenant any
hand trucks, or other vehicles of any kind except those equipped with rubber
tires and side guards.
24. Tenant shall not contract for any work or service which might
involve the employment of labor incompatible with the Building employees or
employees of contractors doing work or performing services by or on behalf of
the Landlord.
25. No tenant shall install any radio or television antenna,
loud-speaker, or other device on the roof or exterior walls of the Building,
without the prior written consent of Landlord.
26. These Rules and Regulations are in addition to, and shall not be
construed to in any way modify or amend, in whole or in part, the terms,
covenants, agreements and conditions of any lease of premises in the Building.
4