EXHIBIT 10.12
INDUSTRIAL REAL ESTATE LEASE
(MULTI-TENANT FACILITY)
CB COMMERCIAL REAL ESTATE GROUP INC.
BROKERAGE AND MANAGEMENT
LICENSED REAL ESTATE BROKER
ARTICLE ONE: BASIC TERMS
This Article One contains the Basic Terms of this Lease between the Landlord and
Tenant named below. Other Articles, Sections and Paragraphs of the Lease
referred to in this Article One explain and define the Basic Terms and are to be
read in conjunction with the Basic Terms.
Section 1.01. DATE OF LEASE: April 17, 1995
Section 1.02 Landlord (include legal entity) Cody Three, Inc., a Wyoming
Corporation
Address of Landlord: 1800 Grant Street, Denver, CO 80203
Section 1.03 Tenant (include legal entity) Maxwell Laboratories, Inc., a
Delaware corporation, I-Bus Division
Address of Tenant: 8888 Balboa Avenue, San Diego, CA 92123
Section 1.04. PROPERTY: The Property is part of Landlord's multi-tenant real
property development known as
Sky Park Centre
and described or depicted in Exhibit 'D' (the "Project"), The Project includes
the land, the buildings and all other improvements located on the land, and the
common areas described in Paragraph 4.05(a). The Property is (include street
address, approximate square footage and description) 9174 Sky Park Court, San
Diego, CA, approximately 35,417 SQUARE FEET AS further described in Exhibits "B"
& "D"
Section 1.05. Lease Term: Five (5) years 'Two (2) months beginning on(October 1,
1995 (see "First Lease Rider" Item 7) or such other date as is specified in
this Lease, and ENDING on November 30, 2000.
Section 1.06. Permitted Uses: (See Article Five) Engineering Research &
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DEVELOPMENT, LIGHT Manufacturing Assembly Distribution and Administrative
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Offices.
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Section 1.07. TENANT'S GUARANTOR: (If none, so state) none
Section 1.08 Brokers: (See Article fourteen) (If none, so state)
Landlord's Broker CB Commercial Real Estate Group
Tenant's Broker: CB Commercial Real Estate Group
Section 1.09 COMMISSION PAYABLE TO LANDLORD'S BROKER (See Article Fourteen) $
per separate agreement
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Section 1.10. Initial Security Deposit: (See Section 3.03) $
Section 1.11. VEHICLE PARKING SPACES ALLOCATED to Tenant: (See Section 4.05 See
"First Lease Rider" Item 8
Section 1.12. RENT AND OTHER CHARGES PAYABLE by Tenant:
(a) BASE RENT : Twenty four thousand eighty four and no/100 Dollars($ 24,084.00)
per month for the first 12 months. as provided in Section 3.01, and shall be
increased on the first day of the 13th, 25th, 37th & 49th month(s) after the
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Commencement Date, either (i) as provided in Section 3.02, or
SECTION 1.13 COSTS AND CHARGES PAYABLE BY LANDLORD: (a) Base Real Property Taxes
(See Section 4.02); (b) Base
Insurance Premiums (See Section 4.04(c)); (c) Maintenance and Repair (See
Article Six).
Section 1.14. LANDLORD'S SHARE OF PROFIT ON ASSIGNMENT OR SUBLEASE: (See Section
9.05) zero percent ( 0 00 %) of the Profit (the "Landlord's Share").
Section 1.15. RIDERS: THE following Riders are attached to and made a part of
this Lease (if none, so state)
FIRST LEASE RIDER, EXHIBIT "A" - SPECIFICATIONS, EXHIBIT 'B" - FLOOR PLANS,
Exhibit "C" - Expansion Area, Exhibit "D" - Project site Plan, Exhibit "E" -
Building
Rules & Regulations, Exhibit "F" - work Letter Agreement, Exhibit "G" - Tenant's
Use of
Hazardous Materials
ARTICLE TWO: LEASE TERM
Section 2.01. Lease of Property For Lease Term. Landlord leases the Property to
Tenant and Tenant leases the Property from Landlord for the Lease Term. The
Lease Term is for the period stated in Section 1 .0S above and shall begin and
end on the dates specified in Section 1.05 above, unless the beginning or end of
the Lease Term is changed under any provision of this Lease. The "Commencement
Date" shall be the dale specified in Section 1.05 above for the beginning of the
Lease Term, unless advanced or delayed under any provision of this Lease.
Section 2.02. DELAY IN COMMENCEMENT. Landlord shall not be liable to Tenant it
Landlord does not deliver possession of the Property to Tenant on the
Commencement Date. Landlord's non-delivery of the Property to Tenant on that
date shall not affect this Lease or the obligations of Tenant under this Lease
except that the Commencement Date shall be delayed until Landlord delivers
possession of the Property to Tenant and the Lease Term shall be extended for a
period equal to the delay in delivery of possession of the Property to Tenants,
plus the number of days necessary to end the Lease Term on the last day of a
month. If Landlord does not deliver possession of the Property to Tenant within
sixty (60) days after the Commencement Date, Tenant may elect to cancel this
Lease by giving written notice to Landlord within ten (10) days after the sixty
(60) -day period ends. It Tenant gives such notice, the Lease shall be canceled
and neither Landlord nor Tenant shall have any further obligations to the other.
It Tenant does not give such notice, Tenant's right to cancel the Lease shall
expire and the Lease Term shall commence upon the delivery of possession of the
Property to Tenant. If delivery of possession of the Property to Tenant is
delayed. Landlord and Tenant shall, upon such delivery, execute an amendment to
this Lease setting forth the actual Commencement Date and expiration date of the
Lease. Failure to execute such amendment shall not affect the actual
Commencement Date and expiration date of the Lease. see "First Lease Rider"
Item 7,
Section 2.03. EARLY OCCUPANCY. If Tenant occupies the Property prior to the
Commencement Date, Tenant's occupancy of the Property shall be subject to all of
the provisions of this Lease. Early occupancy of the Property shall not advance
the expiration date of this Lease. AS DESCRIBED IN "FIRST LEASE RIDER" ITEM 7.
Section 2.04. HOLDING OVER. Tenant shall vacate the Property upon the expiration
or earlier termination of this Lease. Tenant shall reimburse Landlord for and
indemnify Landlord against all damages which Landlord incurs from Tenant's delay
in vacating the Property. It Tenant does not vacate the Property upon the
expiration or earlier termination of the Lease and Landlord thereafter accepts
rent from Tenant, Tenant's occupancy of the Property shall be a "month-to-month"
tenancy, subject to all of the terms of this Lease applicable to a month-to-
month tenancy, except that the Base Rent then in effect shaft be increased by
twenty-five percent (25%).
ARTICLE THREE: BASE RENT
Section 3.01. Time and Manner of Payment. Upon execution of this Lease, Tenant
shall pay Landlord the Base Rent in the amount stated in Paragraph 1.12(a) above
for the first month of the Lease Term. On the first day of the second month of
the Lease Term and each month thereafter, Tenant shall pay Landlord the Base
Rent, in advance, without offset. deduction or prior demand. The Base Rent shall
be payable at Landlord's address or at such other place as Landlord may
designate in writing., except as provided for in "First Lease Rider" Item 7.
Section 3.02. COST OF LIVING INCREASES. The Base Rent shall be increased on each
date (the "Rental Adjustment Date") stated in Paragraph 1.1 2(a) above in
accordance with the increase in the United States Department of Labor. Bureau of
Labor Statistics, Consumer Price Index for Alt Urban Consumers (all items for
the geographical Statistical Area in which the Property is located on the basis
of 1982-1984 = 100) (the "Index") as follows:
(a) The Base Rent (the "Comparison Base Rent'') in effect immediately before
each Rental Adjustment Date shall be increased by the percentage that the Index
has increased from the date (the ''Comparison Date") on which payment of the
Comparison Base Rent began through the month in which the applicable Rental
Adjustment Date occurs. The Base Rent shall not be reduced by reason of such
computation. Landlord shall notify Tenant of each increase by a written
statement which shall include the Index for the applicable Comparison Date. the
Index for the applicable Rental Adjustment Date. the percentage increase between
those two indices, and the new Base Rent. Any increase in the Base Rent provided
for in this Section 3.02 shall be subject to any minimum or maximum increase.
as described in "First Lease Rider" Item 5
(D) Tenant shall pay the new Base Rent from the applicable Rental Adjustment
Date until the next Rental Adjustment Date. Landlord's notice may be given after
the applicable Rental Adjustment Date of the increase, and Tenant shall pay
Landlord the accrued rental adjustment for the months elapsed between the
effective date of the increase and Landlord's notice of such increase within ten
(10) days after Landlord's notice. It the format or components of the Index are
materially changed after the Commencement Date, Landlord shall substitute an
index which is published by the Bureau of Labor Statistics or similar agency and
which is most needy equivalent to the Index in effect on the Commencement Date.
The substitute index shall be used to calculate the increase in the Base Rent
unless Tenant objects to such index in writing within fifteen (15) days after
receipt of Landlord's notice. If Tenant objects, landlord and Tenant shall
submit the selection of the substitute index for binding arbitration in
accordance with the ruses and regulations of the American Arbitration
Association at its office closest to the Property. The costs of arbitration
shall be borne equally by Landlord and Tenant.
Section 3.04. TERMINATION; ADVANCE PAYMENTS. Upon termination of this Lease
under Article Seven (Damage or Destruction), Article Eight (Condemnation) or any
other termination not resulting from Tenant's default. and after Tenant has
vacated the Property in the manner required by this Lease. Landlord shall refund
or credit to Tenant (or Tenant's successor), any advance rent or other advance
payments made by Tenant to Landlord.
ARTICLE FOUR: OTHER CHARGES PAYABLE BY TENANT
Section 4.01. Additional Rent. All charges payable by Tenant other than Base
Rent are called "Additional Rent. " Unless this Lease provides otherwise, Tenant
shall pay all Additional Rent then due with the next monthly installment of Base
Rent. The term "rent" shall mean Base Rent and Additional Rent. As of the date
of this Lease, there are no charges
Section 4.02. PROPERTY TAXES. THAT CONSTITUTE ADDITIONAL RENT.
(b) DEFINITION OF " REAL PROPERTY TAX. " " Real property tax" means: (i) any
fee, license fee, license tax, business license fee, commercial rental tax,
levy, charge, assessment, penalty or tax imposed by any taxing authority against
the Property; (ii) any tax on the Landlord's right to receive, or the receipt
of, rent or income from the Property or against Landlord's business of leasing
the Property; (iii) any tax or charge for fire protection, streets, sidewalks,
road maintenance, refuse or other services provided to the Property by any
governmental agency; (iv) any tax imposed upon this transaction or based upon a
re-assessment of the Property due to a change of ownership, as defined by
applicable law, or other transfer of all or part of Landlord's interest in the
Property; and (v) any charge or tee replacing any tax previously included within
the definition of real property tax. "Real property tax" does not, however,
include Landlord's federal or state income, franchise, inheritance or estate
taxes.
(d) PERSONAL PROPERTY TAXES.
(i) Tenant shall pay all taxes charged against trade fixtures, furnishings,
equipment or any other personal property belonging to Tenant. Tenant shall try
to have personal property taxed separately from the Property.
(ii) If any of Tenant's personal property is taxed with the Property, Tenant
shall pay Landlord the taxes for the personal property within fifteen (15) days
after Tenant receives a written statement from Landlord for such personal
property taxes.
Section 4.03. UTILITIES. Tenant shall pay, directly to the appropriate supplier,
the cost of all natural gas, heat, light, power, sewer service, telephone,
water, refuse disposal and other utilities and services supplied to the
Property.
Section 4.04. INSURANCE POLICIES.
(a) LIABILITY INSURANCE. During the Lease Term, Tenant shall maintain a policy
of commercial general liability insurance (sometimes known as broad form
comprehensive general liability insurance) insuring Tenant against liability for
bodily injury, property damage (including loss of use of property) and personal
injury arising out of the operation, use or occupancy of the Property. Tenant
shaft name Landlord as an additional insured under such policy. The initial
amount of such insurance shall be One Million Dollars (S1,000,000) per
occurrence.
The liability insurance obtained by tenant under this Paragraph 4.04(a) shall
(i) be primary and (iii) insure Landlord against Tenant's performance under
Section 5.05, if the matters giving rise to the indemnity under Section 5.05
result from the negligence of Tenant. The amount and coverage of such insurance
shall not limit Tenant's liability nor relieve Tenant of any other obligation
under this Lease. Landlord may also obtain comprehensive public liability
insurance in an amount and with coverage determined by Landlord insuring
Landlord against liability arising out of ownership, operation, use or occupancy
of the Property. The policy obtained by Landlord shall not be contributory and
shall not provide primary insurance.
(b) PROPERTY AND RENTAL INCOME INSURANCE. During the Lease Term, Landlord shall
maintain policies of insurance covering loss of or damage to the Property in the
full amount of its replacement value. Such policy shall contain an Initiation
Guard Endorsement and shall provide protection against all perils included
within the classification of fire, extended coverage, vandalism, malicious
mischief, special extended perils (all risk), sprinkler leakage and any other
perils which Landlord deems reasonably necessary. Landlord shall have the right
to obtain flood and earthquake insurance if required by any lender holding a
security interest in the Property. Landlord shall not obtain insurance for
Tenant's fixtures or equipment or building improvements installed by Tenant on
the Property. During the Lease Term, Landlord shall also maintain a rental
income insurance policy, with loss payable to Landlord, in an amount equal to
one year's Base Rent, plus estimated real property taxes and insurance premiums.
Tenant shall not do or permit anything to be done which invalidates any such
insurance policies.
(C) Payment. of Premiums.
(i) Landlord shall pay the "Premiums" for the insurance policies maintained by
Landlord under
Paragraph 4.04(b )
(d) General Insurance Provisions.
(i) Any insurance which Tenant is required to maintain under this Lease shall
include a provision which requires the insurance carrier to give Landlord not
less than thirty (30) days' written notice prior to any cancellation or
modification of such coverage, theft materially affects insurance required under
this Lease.
(ii) If Tenant fails to deliver any policy, certificate or renewal to Landlord
required under this Lease within the prescribed time period or if any such
policy is canceled or modified in a way that materially affects insurance
required under this Lease during the Lease Term without Landlord's consent,
Landlord may:
obtain such insurance, in which case Tenant shall reimburse Landlord for the
cost of such insurance within fifteen (15) days after receipt of a statement
that indicates the cost of such insurance.
(iii) Tenant shall maintain all insurance required under this Lease with
companies holding a "General Policy Rating" of A-12 or better, as set forth in
the most current issue of "Best Key Rating Guide". Landlord and Tenant
acknowledge the insurance markets are rapidly changing and that insurance in the
form and amounts described in this Section 4.04 may not be available in the
future. Tenant acknowledges that the insurance described in this Section 4.04 is
for the primary
benefit of Landlord. If at any time during the Lease Term, Tenant is unable to
maintain the insurance required under the Lease, Tenant shall nevertheless
maintain insurance coverage which is customary and commercially reasonable in
the insurance industry for Tenant's type of business, as that coverage may
change from time to time. Landlord makes no representation as to the adequacy of
such insurance to protect Landlord's or Tenant's interests. Therefore, Tenant
shall obtain any such additional property or liability insurance which Tenant
deems necessary to protect Landlord and Tenant.
(iv) Unless prohibited under any applicable insurance policies maintained,
Landlord and Tenant each hereby waive any and all rights of recovery against the
other, or against the officers, employees, agents or representatives of the
other, for loss of or damage to its property or the property of others under its
control, if such loss or damage is covered by any insurance policy in force
(whether or not described in this Lease) at the time of such loss or damage.
Upon obtaining the required policies of insurance, Landlord and Tenant shall
give notice to the insurance carriers of this mutual waiver of- subrogation.
Section 4.05. Common Areas; Use, Maintenance and Costs.
(a) Common Areas. As used in this Lease, "Common Areas" shall mean all areas
within the Project which are available for the common use of tenants of the
Project and which are not leased or held for the exclusive use of Tenant or
other tenants, including, but not limited to, parking areas, driveways,
sidewalks, loading areas, access roads, corridors, landscaping and planted
areas. Landlord, from time to time, may change the size, location, nature and
use of any of the Common Areas, convert Common Areas into leaseable areas,
construct additional parking facilities (including parking structures) in the
Common Areas, and increase or decrease Common Area land and/or facilities.
Tenant acknowledges that such activities may result in inconvenience to Tenant.
Such activities and changes are permitted it they do not materially affect
Tenant's use of the Property.
(b) Use of Common Areas. Tenant shall have the nonexclusive right (in common
with other tenants and all others to whom Landlord has granted or may grant such
rights) to use the Common Areas for the purposes intended, subject to such
reasonable rules and regulations as Landlord may establish from time to time.
Tenant shall abide by such rules and regulations and shall use its best effort
to cause others who use the Common Areas with Tenant's express or implied
permission to abide by Landlord's rules and regulations. At any time, Landlord
may close any Common Areas to perform any acts in the Common Areas as, in
Landlord's judgment. are desirable to improve the Project. Tenant shall not
interfere with the rights of Landlord. other tenants or any other person
entitled to use the Common Areas.
(c) Specific Provision re: Vehicle Parking. Tenant shall be entitled to use the
number of vehicle parking spaces in the Project allocated to Tenant in Section
1.11 of the Lease without paying any additional rent. Tenant's parking shall not
be reserved (except as described in "First Lease Rider" Item 8) and shall be
limited to vehicles no larger than standard size automobiles or pickup utility
vehicles. Tenant shall not cause large trucks or other large vehicles to be
parked within the Project or on the adjacent public streets. Temporary parking
of large delivery vehicles in the Project may be permitted by the rules and
regulations established by Landlord. Vehicles shall be parked only in striped
parking spaces and not in driveways, loading areas or other locations not
specifically designated for parking. Handicapped spaces shall only be used by
those legally permitted to use them. If Tenant habitually parks more vehicles in
the parking area than the number set forth in Section 1.11 of this Lease and
fails to cure after written notice from Landlord such conduct shall be a
material breach of this Lease. In addition to Landlord's other remedies under
the Lease, Tenant shall pay a daily charge determined by Landlord for each such
additional vehicle.
(d) MAINTENANCE O T COMMON AREAS. Landlord shall maintain the Common Areas in
good order, condition and repair and shall operate the Project, in Landlord's
sole discretion, as a first-class industrial/commercial real property
development.
Section 4.06. LATE CHARGES. Tenant's failure to pay rent promptly may cause
Landlord to incur unanticipated costs. The exact amount of such costs are
impractical or extremely difficult to ascertain. Such costs may include, but are
not limited to, processing and accounting charges and late charges which may be
imposed on Landlord by any ground lease, mortgage or trust deed encumbering the
Property. Therefore, if Landlord does not receive any rent payment within ten (
10) days after it becomes due, Tenant shall pay Landlord a late charge equal to,
five percent (5%) of the overdue amount. The parties agree that such late charge
represents a fair and reasonable estimate of the costs Landlord will incur by
reason of such late payment.
Section 4.07. INTEREST ON PAST DUE OBLIGATIONS. Any amount owed by Tenant to
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Landlord which is not Paid when due shall bear interest at the rate of twelve
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percent (12%) per annum from the due date of such amount. However, interest
shall not be payable on late charges to be paid by Tenant under this Lease. The
payment of interest on such amounts shall not excuse or cure any default by
Tenant under this Lease. If the interest rate specified in this Lease is higher
than the rate permitted by law, the interest rate is hereby decreased to the
maximum legal interest rate permitted by law.
ARTICLE FIVE: USE OF PROPERTY
Section 5.01. Permitted Uses. Tenant may use the Property only for the Permitted
Uses set forth in Section 1.06 above.
Section 5.02. MANNER OF USE. Tenant shall not cause or permit the Property to be
used in any way which constitutes a violation of any law, ordinance, or
governmental regulation or order, which annoys or interferes with the rights of
tenants of the Project, or which constitutes a nuisance or waste. Tenant shall
promptly take all actions necessary to comply with all applicable statutes,
ordinances, rules, regulations, orders and requirements regulating the use by
Tenant of the Property including the Occupational Safety and Health Act.
Section 5.03. HAZARDOUS MATERIALS. As used in this Lease. the term "Hazardous
Material" means any flammable items, explosives, radioactive materials,
hazardous or toxic substances, material. or waste or related materials,
including any substances defined as or included in the definition of "hazardous
substances, "hazardous wastes", "hazardous materials" or "toxic substances" now
or subsequently regulated under any applicable federal, state or local laws or
regulations, including without limitation petroleum-based products, paints.
solvents, lead, cyanide, DOT, printing inks, acids, pesticides, ammonia
compounds and other chemical products, asbestos, PCBs and similar compounds, and
including any different products and materials which are subsequently found to
hays adverse effects on the environment or the health and safety of persons.
TENANT ' n shall not cause or permit any Hazardous Material to be generated,
produced, brought upon, used, stored, treated or disposed of in or about the
Property by Tenant, its agents, employees, contractors, sublessees or invitees
without the prior written consent of Landlord. Landlord shall be entitled to
take into account such other factors or facts as Landlord may reasonably
determine to be relevant in determining whether to grant or withhold consent to
Tenant's proposed activity with respect to Hazardous Material. In no event,
however, shall Landlord be required to consent to the installation or use of any
storage tanks on the Property. see "First Lease Rider' Item 13.
Section 5.04. SIGNS AND AUCTIONS. Tenant shall not place any signs on the
Property without Landlord's prior written consent. Tenant shall not conduct or
permit any auctions or sheriff's sales at the Property. ...
Section 5.05. INDEMNITY. Tenant shall indemnify Landlord against and hold
Landlord harmless from any and all costs, claims or liability arising from: (a)
Tenant's use of the Property; (b) the conduct of Tenant's business or anything
else done or ,5 permitted by Tenant to be done in or about the Property,
including any contamination of the Property or any other property resulting
from the presence or use of Hazardous Material caused or permitted by Tenant:
(c) any breach or default in the performance of Tenant's obligations under this
Lease; (d) any misrepresentation or breach of warranty by Tenant under this
Lease; or (e) other acts or omissions of Tenant constituting gross negligence,
Tenant shall defend Landlord against any such cost. claim or liability at
Tenant's expense with counsel reasonably acceptable to Landlord or, at
Landlord's election, Tenant shall reimburse Landlord for any legal fees or costs
incurred by Landlord in connection with any such claim. As a material part of
the consideration to Landlord, Tenant assumes all risk of damage to property or
injury to persons in or about the Property arising from any cause, and Tenant
hereby waives all claims in respect thereof against Landlord, except for any
claim arising out of Landlord's gross negligence , or willful misconduct. As
used in this Section, the term "Tenant" shall include Tenant's employees,
agents. contractors and invitees, if applicable.
Section 5.06. LANDLORD'S ACCESS. Landlord or its agents may enter the Property
at all reasonable times (with at least 24 hours notice) to show the Property to
potential buyers, investors or tenants or other parties to do any other act or
to inspect and conduct tests in order `: to monitor Tenant's compliance with all
applicable environmental laws and all laws governing the presence and use of
Hazardous Material; or for any other
purpose Landlord deems necessary. Landlord shall give Tenant reasonable prior
notice of such entry, except in the case of an emergency. Landlord may place
customary "For Lease" signs on the Property provided, upon notice of vacation of
premises by Tenant, such signage shall prominently display "Tenant Relocating"
Section 5.07. QUIET POSSESSION. If Tenant pays the rent and complies with all
other terms of this Lease, Tenant may occupy and enjoy the Property for the full
Lease Term, subject to the provisions of this Lease.
ARTICLE SIX: CONDITION OF PROPERTY; MAINTENANCE, REPAIRS AND ALTERATIONS
Section 6.01. EXISTING CONDITIONS. Tenant accepts the Property in its condition
as of the execution of the Lease, subject ~1 to all recorded matters, laws,
ordinances, and governmental regulations and orders. Except as provided herein,
Tenant !!3, acknowledges that neither Landlord nor any agent of Landlord has
made any representation as to the condition of the Property ,3, or the
suitability of the Property for Tenant's intended use. Tenant represents and
warrants that Tenant has made its own inspection of and inquiry regarding the
condition of the Property and is not relying on any representations of Landlord
or any Broker with respect thereto. If Landlord or Landlord's Broker has
provided a Property Information Sheet or other Disclosure Statement regarding
the Property, a copy is attached as an exhibit to the Lease.
Section 6.05. EXEMPTION OF THE LANDLORD FROM LIABILITY. Landlord shall not be
liable for any damage or injury to the person, business (or any loss of income
therefrom), goods, wares, merchandise or other property of Tenant, Tenant's
employees, invitees, customers or any other person in or about the Property,
whether such damage or injury is caused by or results from: (a) fire, steam,
electricity, water, gas or rain (b) the breakage, leakage, obstruction or other
defects of pipes, sprinklers, wires, appliances, plumbing, air conditioning or
lighting fixtures or any other cause; (c) conditions arising in or about the
Property or upon other portions of the Project, or from other sources or places;
or (d) any act or omission of any other tenant of the Project. Landlord shall
not be liable for any such damage or injury even though the cause of or the
means of repairing such damage or injury are not accessible to Tenant, The
provisions of this Section 6.02 shall not, however, exempt Landlord from
liability for Landlord's gross negligence or willful misconduct.
Section 6.03 LANDLORD'S OBLIGATIONS. Subject to the provisions of Article Seven
(Damage or Destruction) and Article Eight (Condemnation), and except for damage
caused by any act or omission of Tenant, or Tenant's employees, agents,
contractors or invitees, Landlord shall keep the foundation, roof and structural
portions of exterior walls of the improvements on the Property in good Order,
condition and repair. However, Landlord shall not be obligated to maintain or
repair windows, doors, plate glass or the surfaces of walls. Landlord shall not
be obligated to make any repairs under this Section 6.03 until a reasonable time
after receipt of a written notice from Tenant of the need for such repairs.
Section 6.04. TENANT'S OBLIGATIONS.
(a) Except as provided in Section 6.03, Article Seven (Damage or Destruction)
and Article Eight (Condemnation), Tenant shall keep all portions of the Property
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(including nonstructural, interior, systems and equipment, except heating,
ventilation & air conditioning) in good order, condition and repair (including
interior repainting and refinishing, as needed). If any portion of the Property
or any system or equipment in the Property which Tenant is obligated to repair
cannot be fully repaired or restored, Tenant shall promptly replace such portion
of the Property or system or equipment in the Property, regardless of whether
the benefit of such replacement extends beyond the Lease Term but if the benefit
or useful life of such replacement extends beyond the Lease Term (as such term
may be extended by exercise of any options), the useful life of such replacement
shall be prorated over the remaining portion of the Lease Term (as extended),
and Tenant shall be liable only for that portion of the cost which is applicable
to the Lease Term (as extended). Landlord shall undertake the responsibility for
preventive maintenance of the heating and air conditioning system. In addition,
Tenant shall, at Tenant's expense, repair any damage to the roof, foundation or
structural portions of walls caused by Tenant's acts or omissions. It is the
intention of Landlord and Tenant that, at all times during the Lease Term,
Tenant shall maintain the Property in an attractive, first-class and fully
operative condition.
(b) Tenant Shall fulfill all of Tenant's obligations under this Section 6.04 at
Tenant's sole expense. It Tenant fails to maintain, repair or replace the
Property as required by this Section 6.04, Landlord may, upon ten (10) days'
prior notice to Tenant (except that no notice shall be required in the case of
an emergency), enter the Property and perform such maintenance or repair
(including replacement, as needed) on behalf of Tenant. In
such case, Tenant shall reimburse Landlord for all costs incurred in performing
such maintenance or repair immediately upon demand.
Section 6.05. Alterations, Additions, and improvements.
(a) Tenant shall not make any alterations, additions, or improvements to the
Property without Landlord's prior written consent, except for non-structural
alterations which do not exceed Ten Thousand Dollars (510,000) in cost
cumulatively over the Lease Term and which are not visible from the outside of
any building of which the Property is part. Landlord may require Tenant to
provide demolition and/or lien and completion bonds in form and amount
satisfactory to Landlord. Tenant shall l promptly remove any alterations,
additions, or improvements constructed in violation of this Paragraph 6.05(a)
upon Landlord's; written request. All alterations, additions, and improvements
shall be done in a good and workmanlike manner, in conformity c with all
applicable laws and regulations, and by a contractor approved by Landlord. Upon
completion of any such work, Tenant shall provide Landlord with "as built"
plans, copies of all construction contracts, and proof of payment for all labor
and materials.
(b) Tenant shall pay when due all claims for labor and material furnished to the
Property. Tenant shall give Landlord at least twenty (20) days' prior written
notice of the commencement of any work on the Property, regardless of whether
Landlord's consent to such work is required. Landlord may elect to record and
post notices of non-responsibility on the Property.
Section 6.06. Condition upon Termination. Upon the termination of the Lease,
Tenant shall surrender the Property to Landlord, broom clean and in the same
condition as received except for ordinary wear and tear which Tenant was not
otherwise obligated to remedy under any provision of this Lease. However, Tenant
shall not be obligated to repair any damage which Landlord is required to repair
under Article Seven (Damage or Destruction). In addition, Landlord may require
Tenant to remove any alterations, additions or improvements (whether or not made
with Landlord's consent) prior to the expiration of the Lease and to restore the
Property to its prior condition, all at Tenant's expense. All alterations,
additions and improvements which Landlord has not required Tenant to remove
shall become Landlord's property and shall be surrendered to Landlord upon the
expiration or earlier termination of the Lease, except that Tenant may remove
any of Tenant's machinery or equipment which , can be removed without material
damage to the Property. Tenant shall repair, at Tenant's expense, any damage to
the Property caused by the removal of any such machinery or equipment. In no
event, however, shall Tenant remove any of the following materials or equipment
(which shall be deemed Landlord's property) without Landlord's prior written
consent: any power wiring or power panels; lighting or lighting fixtures; wall
coverings; drapes, blinds or other window coverings; carpets or other floor
coverings; heaters, air conditioners or any other heating or air conditioning
equipment; fencing or security gates or other similar building operating
equipment and decorations.
ARTICLE SEVEN DAMAGE OR DESTRUCTION
Section 701. Partial Damage to Property.
(a) Tenant shall notify Landlord in writing immediately upon the occurrence of
any damage to the Property. If the Property is only partially damaged (i.e.,
less than fifty percent (50%) of the Property is untenantable as a result of
such damage or less than fifty percent (50%) of Tenant's operations are
materially impaired) and if the proceeds received by Landlord from the insurance
policies described in Paragraph 4.04(b)) are sufficient to pay for the necessary
repairs, this Lease shall remain in effect and Landlord shall repair the damage
as soon as reasonably possible. Landlord may elect (but is not required) to
repair any damage to Tenant's fixtures, equipment, or improvements.
(b) It the insurance proceeds received by Landlord are not sufficient to pay the
entire cost of repair, or it the cause of the damage is not covered by the
insurance policies which Landlord maintains under Paragraph 4.04(b), Landlord
may elect either to (i) repair the damage as soon as reasonably possible, in
which case this Lease shall remain in full force and effect, or (ii) terminate
this Lease as of the date the damage occurred. Landlord shall notify Tenant
within thirty (30) days after receipt of notice of the occurrence of the damage
whether Landlord elects to repair the damage or terminate the Lease. If Landlord
elects to repair the damage,
Tenant shall pay Landlord the "deductible amount" (if any) under Landlord's
insurance policies if the damage was due to an act or omission of Tenant, or
Tenant's employees, agents, contractors or invitees, the difference between the
actual cost of repair and any insurance proceeds received by Landlord provided
that repairs are to return the Property to the original and/of like condition.
Landlord elects to terminate the Lease, Tenant may elect to continue this Lease
in full force and effect, in which case Tenant shall repair any damage to the
Property and any building in which the Property is located. Tenant shall pay the
cost of such repairs, except that upon satisfactory completion of such repairs,
Landlord shall deliver to Tenant any insurance proceeds received by Landlord for
the damage repaired by Tenant. Tenant shall give Landlord written notice of such
election within ten (10) days after receiving Landlord's termination notice.
(c) It the damage to the Property occurs during the last six (6) months of the
Lease Term and such damage will require more than thirty (30) days to repair,
either Landlord or Tenant may elect to terminate this Lease as of the date the
damage occurred. regardless of the sufficiency of any insurance proceeds. The
party electing to terminate this Lease shall give written notification to the
other party of such election within thirty (30) days after Tenant's notice to
Landlord of the occurrence of the damage.
Section 7.02. Substantial or Total Destruction. If the Property is substantially
or totally destroyed in such a way that Tenant is prevented from operating its
business by any cause whatsoever (i.e., the damage to the Property is greater
than partial damage as described in Section 701), and regardless of whether
Landlord receives any insurance proceeds, this Lease shall terminate as of the
date the destruction occurred. Notwithstanding the preceding sentence, it the
Property can be rebuilt within six (6) months after the date of destruction,
Landlord may elect to rebuild the Property at Landlord's own expense, in which
case this Lease shall remain in full force and effect. Landlord shall notify
Tenant of such election within thirty (30) days after Tenant's notice of the
occurrence of total or substantial destruction. If Landlord so elects, Landlord
shall rebuild the Property at Landlord's sole expense. Should Landlord so
elect, Landlord would bear the reasonable costs of providing temporary
replacement facilities, including costs of moving to and from said temporary
replacement facilities.
Section 7.03. Temporary Reduction of Rent. If the Property is destroyed or
damaged and Landlord or Tenant repairs or restores Property pursuant to the
provisions of this Article Seven, any rent payable during the period of such
damage, repair and/or restoration shall be reduced according to the degree, if
any, to which Tenant's use of the Property is impaired. Except for such
possible reduction in Base Rent, Tenant shall not be entitled to any
compensation, reduction, or reimbursement from Landlord as a result of any
damage, destruction, repair, or restoration of or to the Property.
Section 704. WAIVER. Tenant waives the protection of any statute, code or
judicial decision which grants a tenant the right to terminate a lease in the
event of the substantial or total destruction of the leased property. Tenant
agrees that the provisions of Section 702 above shall govern the rights and
obligations of Landlord and Tenant in the event of any substantial or total
destruction to the Property.
ARTICLE EIGHT CONDEMNATION
If all or any portion of the Property is taken under the power of eminent domain
or sold under the threat of that power (all of which are called "Condemnation"),
this Lease shall terminate as to the part taken or sold on the date the
condemning authority takes title or possession, whichever occurs first. If more
than twenty percent (20%) of the floor area of the building in which the
Property is located, or which is located on the Property, is taken, either
Landlord or Tenant may terminate this Lease as of the date the condemning
authority takes title or possession, by delivering written notice to the other
within ten (10) days after receipt of written notice of such taking (or in the
absence of such notice, within ten (10) days after the condemning authority
takes title or possession). If neither Landlord nor Tenant terminates this
Lease, this Lease shall remain in effect as to the portion of the Property not
taken, except that the Base Rent and Additional Rent shall be reduced in
proportion to the reduction in the floor area of the Property, Any Condemnation
award or payment shall be distributed in the following order (a) first, to any
ground lessor, mortgagee or beneficiary under a deed of trust encumbering the
Property, the amount of its interest in the Property; (b) second, to Tenant,
only the amount of any award specifically designated for loss of or damage to
Tenant's trade fixtures or removable personal property and (c) third, to
Landlord, the remainder of such award, whether as compensation for reduction in
the value of the leasehold, the taking of the fee, or otherwise. If this Lease
is not terminated, Landlord shall repair any damage to the Property caused by
the Condemnation, except that Landlord shall not be obligated to repair any
damage for which
Tenant has been reimbursed by the condemning authority. If the severance damages
received by Landlord are not sufficient to pay for such repair, Landlord shall
have the right to either terminate this Lease or make such repair at Landlord's
expense.
ARTICLE NINE: ASSIGNMENT AND SUBLETTING
Section 9.01. LANDLORD'S CONSENT REQUIRED. see "First Lease Rider" item t1.
Section 9.02. TENANT AFFILIATE. see "First Lease Rider" Item 12.
Section 9.03. NO RELEASE OF TENANT. No transfer permitted by this Article Nine,
whether with or without Landlord's consent, shall release Tenant or change
Tenant's primary liability to pay the rent and to perform all other obligations
of Tenant under this Lease. Landlord's acceptance of rent from any other person
is not a waiver of any provision of this Article Nine. Consent to one transfer
is not a consent to any subsequent transfer. If Tenant's transferee defaults
under this Lease, Landlord may proceed directly against Tenant without pursuing
remedies against the transferee. Landlord may consent to subsequent assignments
or modifications of this Lease by Tenant's transferee, without notifying Tenant
or obtaining its consent. Such action shall not relieve Tenant's liability under
this Lease.
Section 9.04. OFFER TO TERMINATE. If Tenant desires to assign the Lease or
sublease the Property, Tenant shall have the right to offer, in writing, to
terminate the Lease as of a date specified in the offer. If Landlord elects in
writing to accept the offer to terminate within twenty (20) days after notice of
the offer, the Lease shall terminate as of the date specified and all the terms
and provisions of the Lease governing termination shall apply. If Landlord does
not so elect, the Lease shall continue in effect until otherwise terminated and
the provisions of Section 9.05 with respect to any proposed transfer shall
continue to apply.
Section 9.05. LANDLORD'S CONSENT.
(a) Tenant's request for consent to any transfer described in Section 9.01 shall
set forth in writing the details of the proposed transfer, including the name,
business and financial condition of the prospective transferee, financial
details of the proposed transfer (e.g., the term of and the rent and security
deposit payable under any proposed assignment or sublease), and any other
information Landlord deems relevant. Landlord shall have the right to withhold
consent, if reasonable, or to grant consent, based on the following factors: (i)
the business of the proposed assignee or subtenant and the proposed use of the
Property; (ii) the net worth and financial reputation of the proposed assignee
or subtenant; (iii) Tenant's compliance with all of its obligations under the
Lease; and (iv) such other factors as Landlord may reasonably deem relevant. If
Landlord objects to a proposed assignment solely because of the net worth and/or
financial reputation of the proposed assignee Tenant may nonetheless sublease
(but not assign), all or a portion of the Property to the proposed transferee,
but only or, the other terms of the proposed transfer.
(b) If Tenant assigns or subleases, the following shall apply:
(i) Tenant shall pay to Landlord as Additional Rent under the Lease the
Landlord's Share (stated in Section 1.14) of the Profit (defined below) on such
transaction as and when received by Tenant, unless Landlord gives written notice
to Tenant and the assignee or subtenant that Landlord's Share shall be paid by
the assignee or subtenant to Landlord directly.
The "Profit" means (A) all amounts paid to Tenant for such assignment or
sublease, including "key money, monthly rent in excess of the monthly rent
payable under the Lease, and all fees and other consideration paid for the
assignment or sublease, including fees under any collateral agreements, less (8)
costs and expenses directly incurred by Tenant in connection with the execution
and performance of such assignment or sublease for real estate broker's
commissions and costs of renovation or construction of tenant improvements
required under such assignment or sublease. Tenant is entitled to recover such
costs and expenses before Tenant is obligated to pay the Landlord's Share to
Landlord. The Profit in the case of a sublease of less than all the Property is
the rent allocable to the subleased space as a percentage on a square footage
basis.
(ii) Tenant shall provide Landlord a written statement certifying all amounts to
be paid from any assignment or sublease of the Property within shiny (30) days
after the transaction documentation ~s signed, and Landlord may inspect Tenant's
books and records to verify the accuracy of such statement. On written request,
Tenant shall promptly furnish to Landlord copies of all the transaction
documentation, all of which shall be certified by Tenant to be complete, true
and correct. Landlord's receipt of Landlord's Share shall not be a consent to
any further assignment or subletting. The breach of Tenant's obligation under
this Paragraph 9.05(b) shall be a material default of the Lease.
Section 9.06. NO MERGER. No merger shall result from Tenant's sublease of the
Property under this Article Nine, Tenant's surrender of this Lease or the
termination of this Lease in any other manner. In any such event, Landlord may
terminate any or all subtenancies or succeed to the interest of Tenant as
sublandlord under any or all subtenancies.
ARTICLE TEN: DEFAULTS; REMEDIES
Section 10.01. Covenants and Conditions. Tenant's performance of each of
Tenant's obligations under this Lease is a condition as well as a covenant.
Tenant's right to Continue in possession of the Property is conditioned upon
such performance. Time is of the essence in the performance of all covenants and
conditions.
Section 10.02. DEFAULTS. TENANT shall be in material default under this Lease:
(a) If Tenant abandons the Property or if Tenant's vacation of the Property
results in the cancellation of any insurance described in Section 4.04;
(b) If Tenant fails to pay rent or any other charge when due;
(c) If Tenant fails to perform any of Tenant's non-monetary obligations under
this Lease for a period of thirty (30) days after written notice from Landlord:
provided that if more than thirty (30) days are required to complete such
performance, Tenant shall not be in default if Tenant commences such performance
within the thirty (30) -day period and thereafter diligently pursues its
completion. However, Landlord shall not be required to give such notice if
Tenant's failure to perform constitutes a non-curable breach of this Lease. The
notice required by this Paragraph is intended to satisfy any and all notice
requirements imposed by law on Landlord and is not in addition to any such
requirement.
(d) (i) If Tenant makes a general assignment or general arrangement for the
benefit of creditors; (ii) if a petition for adjudication of bankruptcy or for
reorganization or rearrangement is filed by or against Tenant and is not
dismissed within thirty (30) days; (iii) if a trustee or receiver is appointed
to take possession of substantially all of Tenant's assets located at the
Property or of Tenant's interest in this Lease and possession is not restored to
Tenant within thirty (30) days; or (iv) if substantially alt of Tenant's assets
located at the Property or of Tenant's interest in this Lease is subjected to
attachment, execution or other judicial seizure which is not discharged within
shiny (30) days. If a court of competent jurisdiction determines that any of the
acts described in this subparagraph (d) is not a default under this Lease, and a
trustee is appointed to take possession (or if Tenant remains a debtor in
possession) and such trustee or Tenant transfers Tenant's interest hereunder,
then Landlord shall receive, as Additional Rent, the excess. if any, of the rent
(or any other consideration) paid in connection with such assignment or sublease
over the rent payable by Tenant under this Lease.
Section 10.03. Remedies. On the occurrence of any material default by Tenant,
Landlord may, at any time thereafter, with or without notice or demand and
without limiting Landlord in the exercise of any right or remedy which Landlord
may have:
(a) Terminate Tenant's right to possession of the Property by any lawful means,
in which case this Lease shall terminate and Tenant shall immediately surrender
possession of the Property to Landlord. In such event. Landlord shall be
entitled to recover from Tenant all damages incurred by Landlord by reason of
Tenant's default, including (i) the worth at the time of the award of the unpaid
Base Rent, Additional Rent and other charges which Landlord had earned at the
time of the termination; (ii) the worth at the time of
the award of the amount by which the unpaid Base Rent, Additional Rent and other
charges which Landlord would have earned after termination until the time of the
award exceeds the amount of such rental loss that Tenant proves Landlord could
have reasonably avoided (iii) the worth at the time of the award of the amount
by which the unpaid Base Rent, Additional Rent and other charges which Tenant
would have paid for the balance of the Lease Term after the time of award
exceeds the amount of such rental loss that Tenant proves Landlord could have
reasonably avoided; and (iv) any other amount necessary to compensate Landlord
for all the detriment proximately caused by Tenant's failure to perform its
obligations under the Lease or which in the ordinary course of things would be
likely to result therefrom, including, but not limited to. any costs or expenses
Landlord incurs in maintaining or preserving the Property after such default.
the cost of recovering possession of the Property, expenses of reletting,
including necessary renovation or alteration of the Property, Landlord's
reasonable attorneys' fees incurred in connection therewith, and any real estate
commission paid or payable. As used in subparts (i) and (ii) above, the "worth
at the time of the award" is computed by allowing interest on unpaid amounts at
the rate of fifteen percent (15%) per annum, or such lesser amount as may then
be the maximum lawful rate. As used in subpart (iii) above, the "worth at the
time of the award" is computed by discounting such amount at the discount rate
of the Federal Reserve Bank of San Francisco at the time of the award, plus one
percent (1%), If Tenant has abandoned the Property, Landlord shall have the
option of (i) retaking possession of the Property and recovering from Tenant the
amount specified in this Paragraph 1 0.03(a), or (ii) proceeding under Paragraph
1 0.03(b);
(b) Maintain Tenant's right to possession, in which case this Lease shall
continue in effect whether or not Tenant has abandoned the Property. In such
event, Landlord shall be entitled to enforce all of Landlord's rights and
remedies under this Lease, including the right to recover the rent as it becomes
due;
(c) Pursue any other remedy now or hereafter available to Landlord under the
laws or judicial decisions of the state in which the Property is located.
Section 10.04. REPAYMENT OF "FREE" RENT. If this Lease provides for a
postponement of any monthly rental payments, a period of "free" rent or other
rent concession, such postponed rent or "free" rent is carted the "Abated
Rent". Tenant shall be credited with having paid all of the Abated Rent on the
expiration of the Lease Term only if Tenant has fully, faithfully, and
punctually performed all of Tenant's obligations hereunder, including the
payment of all rent (other than the Abated Rent) and the surrender of the
Property in the physical condition required by this Lease. Tenant acknowledges
that its right to receive credit for the Abated Rent is absolutely conditioned
upon Tenant's full, faithful and punctual performance of its obligations under
this Lease. If Tenant defaults and does not cure within any applicable grace
period, the Abated Rent shall immediately become due and payable in full and
this Lease shall be enforced as if there were no such rent abatement or other
rent concession. In such case Abated Rent shall be calculated based on the full
initial rent payable under this Lease.
Section 10.05. AUTOMATIC TERMINATION. Notwithstanding any other term or
provision hereof to the contrary, the Lease shall terminate on the occurrence of
any act which affirms the Landlord's intention to terminate the Lease as
provided in Section 10.03 hereof, including the filing of an unlawful detainer
action against Tenant. On such termination, Landlord's damages for default shaft
include all costs and fees, including reasonable attorneys' fees that Landlord
incurs in connection with the filing, commencement, pursuing and/or defending of
any action in any bankruptcy court or other court with respect to the Lease: the
obtaining of relief from any stay in bankruptcy restraining any action to evict
Tenant: or the pursuing of any action with respect to Landlord's right to
possession of the Property. All such damages suffered (apart from Base Rent and
other rent payable hereunder) shall constitute pecuniary damages which must be
reimbursed to Landlord prior to assumption of the Lease by Tenant or any
successor to Tenant in any bankruptcy or other proceeding.
Section 10.06. CUMULATIVE REMEDIES. Landlord's exercise of any right or remedy
shall not prevent it from exercising any other right or remedy.
ARTICLE ELEVEN' PROTECTION OF LENDERS
Section 11.01. Subordination. Landlord shall have the right to subordinate this
Lease to any ground lease, deed of trust or mortgage encumbering the Property,
any advances made on the security thereof and any
renewals, modifications, consolidations, replacements or extensions thereof,
whenever made or recorded. Tenant shall cooperate with Landlord and any lender
which is acquiring a security interest in the Property or the Lease. Tenant
shall execute such funkier documents and assurances as such lender may require,
provided that Tenant's obligations under this Lease shall not be increased in
any material way (the performance of ministerial acts shall not be deemed
material), and Tenant shall not be deprived of its rights under this Lease.
Tenant's right to quiet possession of the Property during the Lease Term shall
not be disturbed if Tenant pays the rent and performs all of Tenant's
obligations under this Lease and is not otherwise in default.
Section 11.02. ATTORNMENT. If Landlord's interest in the Property is acquired by
any ground lessor, beneficiary under a deed of trust, mortgagee, or purchaser at
a foreclosure sale, Tenant shall attorn to the transferee of or successor to
Landlord's interest in the Property and recognize such transferee or successor
as Landlord under this Lease. Tenant waives the protection of any statute or
rule of law which gives or purports to give Tenant any right to terminate this
Lease or surrender possession of the Property upon the transfer of Landlord's
interest.
Section 11.03. Signing of Documents. Tenant shelf sign and deliver any
instrument or documents necessary or appropriate to evidence any such attornment
or subordination or agreement to do so. If Tenant fails to do so within ten (10)
days after written request, Tenant hereby makes, constitutes and irrevocably
appoints Landlord, or any transferee or successor of Landlord, the attorney-in-
fact of Tenant to execute and deliver any such instrument or document. See
"First Lease Rider" Item 6."
Section 11.04. Estoppel Certificates.
(a) Upon Landlord's written request, Tenant shall execute. acknowledge and
deliver to Landlord a written statement certifying: (i) that none of the terms
or provisions of this Lease have been changed (or if they have been changed,
stating how they have been changed); (ii) that this Lease has not been canceled
or terminated; (iii) the last date of payment of the Base Rent and other charges
and the time period covered by such payment; (iv) that Landlord is not in
default under this Lease (or, if Landlord is claimed to be in default, stating
why); and (v) such other representations or information with respect to Tenant
or the Lease as Landlord may reasonably request or which any prospective
purchaser or encumbrancer of the Property may require. Tenant shall deliver such
statement to Landlord within ten (10) days after Landlord's request. Landlord
may give any such statement by Tenant to any prospective purchaser or
encumbrancer of the Property. Such purchaser or encumbrancer may rely
conclusively upon such statement as true and correct.
(b) If Tenant does not deliver such statement to Landlord within such ten (10) -
day period, Landlord, and any prospective purchaser or encumbrancer, may
conclusively presume and rely upon the following facts: (i) that the terms and
provisions of this Lease have not been changed except as otherwise represented
by Landlord; (ii) that this Lease has not been cancelled or terminated except as
otherwise represented by Landlord; (iii) that not more than one month's Base
Rent or other charges have been paid in advance; and (iv) that Landlord is not
in default under the Lease. In such event, Tenant shall be estopped from denying
the truth of such facts.
Section 11.05. Tenant's Financial Condition. Within ten (10) days after written
request from Landlord, Tenant shall deliver to Landlord such financial
statements as Landlord reasonably requires to verify the net worth of Tenant or
any assignee subtenant, or guarantor of Tenant. In addition, Tenant shall
deliver to any lender designated by Landlord any financial statements required
by such lender to facilitate the financing or refinancing of the Property.
Tenant represents and warrants to Landlord that each such financial statement is
a true and accurate statement as of the date of such statement. All financial
statements shall be confidential and shall be used only for the purposes set
forth in this Lease.
ARTICLE TWELVE: LEGAL COSTS
Section 12.01. LEGAL PROCEEDINGS. If Tenant or Landlord shall be in breach or
default under this Lease, such party (the "Defaulting Party") shall reimburse
the other party (the "Nondefaulting Party") upon demand for any costs or
expenses that the Nondefaulting Party incurs in connection with any breach or
default of the Defaulting Party under this Lease, whether or not suit is
commenced or judgment entered.
Such costs shall include legal fees and costs incurred for the negotiation of a
settlement, enforcement of rights or otherwise. Furthermore, if any action for
breach of or to enforce the provisions of this Lease is commenced, the court in
such action shall award to the party in whose favor a judgment is entered, a
reasonable sum as attorneys' fees and costs. The losing party in such action
shall pay such attorneys' fees and costs. Tenant shall also indemnify Landlord
against And hold Landlord harmless from all costs, expenses, demands and
liability Landlord may incur if Landlord becomes or is made a party to any claim
or action (a) instituted by Tenant against any third party, or by any third
party against Tenant, or by or against any person holding any interest under or
using the Property by license of or agreement with Tenant: (b) for foreclosure
of any lien for labor or material furnished to or for Tenant or such other
person; (C) otherwise arising OUT OF or resulting from any act or transaction of
Tenant or such other person or (d) necessary to protect Landlord's interest
under this Lease in a bankruptcy proceeding, or other proceeding under Title 11
of the United States Code. as amended. Tenant shall defend Landlord against any
such claim or action at Tenant's expense with counsel reasonably acceptable to
Landlord or, at Landlord's election, Tenant shall reimburse Landlord for any
legal fees or costs Landlord incurs in any such claim or action.
ARTICLE THIRTEEN: MISCELLANEOUS PROVISIONS
Section 13.01. Non-Discrimination. Tenant promises, and it is a condition to the
continuance of this Lease, that there will be no discrimination against, or
segregation of, any person or group of persons on the basis of race, color, sex,
creed, national origin or ancestry in the leasing, subleasing, transferring,
occupancy, tenure or use of the Property or any portion thereof.
Section 13.02. LANDLORD'S LIABILITY; CERTAIN DUTIES.
(a) As used in this Lease, the term "Landlord" means only the current owner or
owners of the fee title to the Property or Project or the leasehold estate under
a ground lease of the Property or Project at the time in question. Each Landlord
is obligated to perform the obligations of Landlord under this Lease only during
the time such Landlord owns such interest or title. Any Landlord who transfers
its title or interest is relieved of ail liability with respect to the
obligations of Landlord under this Lease to be performed on or after the date of
transfer. However, each Landlord shall deliver to its transferee all funds that
Tenant previously paid if such funds have not yet been applied under the terms
of this Lease.
(b) Tenant shall give written notice of any failure by Landlord to perform any
of its obligations under this Lease to Landlord and to any ground lessor,
mortgagee or beneficiary under any deed of trust encumbering the Property whose
name and address have been furnished to Tenant in writing. Landlord shall not be
in default under this Lease unless Landlord (or such ground lessor, mortgagee or
beneficiary) fails to cure such non-performance within shiny (30) days after
receipt of Tenant's notice. However, if such non-performance reasonably requires
more than thirty (30) days to cure, Landlord shall not be in default if such
cure is commenced within such shiny (30) -day period and thereafter diligently
pursued to completion.
(c) Notwithstanding any term or provision herein to the contrary, the liability
of Landlord for the performance of its duties and obligations under this Lease
is limited to Landlord's interest in the Property and the Project, and neither
the Landlord nor its partners, shareholders.-, officers or other principals
shall have any personal liability under this Lease.
Section 13.03. SEVERABILITY. A determination by a court of competent
jurisdiction that any provision of this Lease or any pan thereof is illegal or
unenforceable shall not cancel or invalidate the remainder of such provision or
this Lease, which shall remain in full force and effect.
Section 13.04. INTERPRETATION. The captions of the Articles or Sections of this
Lease are to assist the panics in reading this Lease and are not a pan of the
terms or provisions of this Lease. Whenever required by the context of this
Lease. the singular shall include the plural and the plural shall include the
singular. The masculine, feminine and neuter genders shelf each include the
other. In any provision relating to the conduct, acts or omissions of Tenant,
the term "Tenant" shall include Tenant's agents. employees, contractors,
invitees, successors or others using the Property with Tenant's expressed or
implied permission.
Section 13.05. INCORPORATION OF PRIOR AGREEMENTS; MODIFICATIONS. This Lease is
the only agreement between the parties pertaining to the lease of the Property
and no other agreements are effective. All amendments to this Lease shall be in
writing and signed by all parties. Any other attempted amendment shall be void.
Section 13.06. NOTICES. All notices required or permitted under this Lease shall
be in writing and shall be personally delivered or sent by certified mail,
return receipt requested, postage prepaid. Notices to Tenant shall be delivered
to the address specified in Section 1.03 above, except that upon Tenant's taking
possession of the Property, the Property shall be Tenant's address for notice
purposes. Notices to Landlord shall be delivered to the address specified in
Section 1.02 above. Alt notices shall be effective upon delivery. Either party
may change its notice address upon written notice to the other party.
Section 13.07. Waivers. All waivers must be in writing and signed by the waiving
party. Landlord's failure to enforce any provision of this Lease or its
acceptance of rent shall not be a waiver and shall not prevent Landlord from
enforcing that provision or any other provision of this Lease in the future. No
statement on a payment check from Tenant or in a letter accompanying a payment
check shall be binding on Landlord. Landlord may, with or without notice to
Tenant, negotiate such check without being bound to the conditions of such
statement.
Section 13.08. NO RECORDATION. Tenant shall not record this Lease without prior
written consent from Landlord. However, either Landlord or Tenant may require
that a "Short Form" memorandum of this Lease executed by both parties be
recorded. The party requiring such recording shall pay all transfer taxes and
recording fees.
Section 13.09. BINDING EFFECT; CHOICE OF LAW. This Lease binds any party who
legally acquires any rights or interest in this Lease from Landlord or Tenant.
However, Landlord shall have no obligation to Tenant's successor unless the
rights or interests of Tenant's successor are acquired in accordance with the
terms of this Lease. The laws of the state in which the Property is located
shall govern this Lease.
Section 13.10, CORPORATE AUTHORITY. PARTNERSHIP AUTHORITY. If Tenant is a
corporation, each person signing this Lease on behalf of Tenant represents and
warrants that he has full authority to do so and that this Lease binds the
corporation. Within thirty (30) days after this Lease is signed, Tenant shall
deliver to Landlord a certified copy of a resolution of Tenant's Board of
Directors authorizing the execution of this Lease or other evidence of such
authority reasonably acceptable to Landlord.
Section 13.11. JOINT AND SEVERAL LIABILITY. All panics signing this Lease as
Tenant shall be jointly and severally liable for all obligations of Tenant.
Section 13. 12. FORCE MAJEURE. if Landlord cannot perform any of its obligations
due to events beyond Landlord's control, the time provided for performing such
obligations shall be extended by a period of time equal to the duration of such
events. Events beyond Landlord's control include, but are not limited to, acts
of God, war, civil commotion. Labor disputes, strikes, fire, flood or other
casualty, shortages of labor or material, government regulation or restriction
and weather conditions.
Section t 3. 13. EXECUTION OF LEASE. This Lease may be executed in counterparts
and, when all counterpart documents are executed, the counterparts shall
constitute a single binding instrument. Landlord's delivery of this Lease to
Tenant shall not be deemed to be an offer to lease and shall not be binding upon
either party until executed and delivered by both parties.
Section t3.14. SURVIVAL. All representations and warranties of Landlord and
Tenant shall survive the termination of this Lease.
ARTICLE FOURTEEN: BROKERS
Section 14.01. Broker's Fee. When this Lease is signed by and delivered to both
Landlord and Tenant, Landlord shall pay a real estate commission to Landlord's
Broker named in Section 1.08 above, if any, as provided in the written agreement
between Landlord and Landlord's Broker, or the sum stated in Section
1.09 above for services rendered to Landlord by Landlord's Broker in this
transaction. Landlord shall pay Landlord's Broker a commission if Tenant
exercises any option to extend the Lease Term or to buy the Property, or any
similar option or right which Landlord may grant to Tenant, or if Landlord's
Broker is the procuring cause of any other lease or sale entered into between
Landlord and Tenant covering the Property, Such commission shall be the amount
set forth in Landlord's Broker's commission schedule in effect as of the
execution of this Lease. If a Tenant's Broker is named in Section 1.08 above,
Landlord's Broker shall pay an appropriate portion of its commission to Tenant's
Broker if so provided in any agreement between Landlord's Broker and Tenant's
Broker. Nothing contained in this Lease shall impose any obligation on Landlord
to pay a commission or fee to any party other than Landlord's Broker.
Section 14.02. PROTECTION O1 BROKERS. If Landlord sells the Property, or assigns
Landlord's interest in this Lease, the buyer or assignee shall, by accepting
such conveyance of the Property or assignment of the Lease, be conclusively
deemed to have agreed to make all payments to Landlord's Broker thereafter
required of Landlord under this Article Fourteen. Landlord's Broker shall have
the right to bring a legal action to enforce or declare rights under this
provision. The prevailing party in such action shall be entitled to reasonable
attorneys' fees to be paid by the losing party. Such attorneys' fees shall be
fixed by the court in such action. This Paragraph is included in this Lease for
the benefit of Landlord's Broker,
Section 1 4.03, AGENCY DISCLOSURE; NO OTHER BROKERS. Landlord and Tenant each
warrant that they have dealt with no other real estate brokers) in connection
with this transaction except: CB Commercial Real Estate Group, Inc., who
represents
LANDLORD AND TENANT
In the event that CB Commercial represents both Landlord and Tenant, Landlord
and Tenant hereby confirm that they were timely advised of the dual
representation and that they consent to the same, and that they do not expect
said broker to disclose to either of them the confidential information of the
other party.
ARTICLE FIFTEEN: COMPLIANCE
The panics hereto agree to comply with all applicable federal, state and local
laws, regulations, codes. ordinances and administrative orders having
jurisdiction over the parties, property or the subject matter of this Agreement,
including, but not limited to, the 1964 Civil Rights Act and all amendments
thereto, the Foreign investment In Real Property Tax Act, the Comprehensive
Environmental Response Compensation and Liability Act, and The Americans With
Disabilities Act.
ADDITIONAL PROVISIONS MAY BE SET FORTH IN A RIDER OR RIDERS ATTACHED HERETO OR
IN THE BLANK SPACE BELOW. IF NO ADDITIONAL PROVISIONS ARE INSERTED, PLEASE DRAW
A LINE THROUGH THE SPACE BELOW. "First Lease Rider"
Landlord and Tenant have signed this Lease at the place and on the dates
specified adjacent to their signatures below
and have initialled all Riders which are attached to or incorporated by
reference in this Lease.
"LANDLORD"
Signed on April 20, 1995 Cody Three, Inc., a Wyoming corporation
at Denver, Colorado
By: Raymond D. Fink
Its. Vice-President
By:
Its:
"TENANT"
Signed on April 17,1995 Maxwell Laboratories, Inc., a Delaware
at San Diego, California Corporation, I-Bus Division
By: Sean M. Maloy
Its: Executive Vice-President & Chief Operating
Officer
By:
Its:
IN ANY REAL ESTATE TRANSACTION, IT IS RECOMMENDED THAT YOU CONSULT WITH A
PROFESSIONAL, SUCH AS A CIVIL ENGINEER, INDUSTRIAL HYGIENIST OR OTHER PERSON
WITH EXPERIENCE IN EVALUATING THE CONDITION OF THE PROPERTY, INCLUDING THE
POSSIBLE PRESENCE OF ASBESTOS, HAZARDOUS MATERIALS AND UNDERGROUND STORAGE
TANKS.
THIS PRINTED FORM LEASE HAS BEEN DRAFTED BY LEGAL COUNSEL AT THE DIRECTION OF
THE SOUTHERN CALIFORNIA CHAPTER OF THE SOCIETY OF INDUSTRIAL AND OFFICE
REALTORS. INC. NO REPRESENTATION OR RECOMMENDATION IS MADE BY THE SOUTHERN
CALIFORNIA CHAPTER OF THE SOCIETY OF INDUSTRIAL AND OFFICE REALTORS, INC.. ITS
LEGAL COUNSEL, THE REAL ESTATE BROKERS NAMED HEREIN, OR THEIR EMPLOYEES OR
AGENTS, AS TO THE LEGAL SUFFICIENCY, LEGAL EFFECT OR TAX CONSEQUENCES OF THIS
LEASE OR OF THIS TRANSACTION. LANDLORD AND TENANT SHOULD RETAIN LEGAL COUNSEL TO
ADVISE THEM ON SUCH MATTERS AND SHOULD RELY UPON THE ADVICE OF SUCH LEGAL
COUNSEL.
FIRST LEASE RIDER
CODY THREE. INC. AS LANDLORD
AND MAXWELL LABORATORIES. INC. AS TENANT
This First Lease Rider to industrial Real Estate Lease ("Rider") is entered into
concurrently with and made a part of the Industrial Real Estate Lease between
CODY THREE. INC. , (.Landlord") and MAXWELL LABORATORIES. INC, ("Tenant"), dated
---------------------------
APRIL 11.1995 for the premises located at 9174 Sky Park Court, San Diego,
California as more particularly described therein (the "Lease"). Except as
otherwise defined herein, all capitalized terms have the same defined meanings
as in the Lease.
1. Article 16 Signage: Tenant shall have the right to place a sign, which must
--------
be approved by the Landlord, on the premises, in conformity with all CC8R's and
City of San Diego codes and regulations. All costs relating to the design,
installation and removal of said signage will be the responsibility of the
Tenant. Landlord's approval shall not be unreasonably withheld or delayed.
2. Article 17 Tenant Improvements: Landlord agrees to improve the premises as
--------------------
shown and described on Exhibits A. and B. attached hereto and made a part
hereof. Any additional improvements to the premises not specifically addressed
therein shall be the sole responsibility of the Tenant. Should Tenant request
that additional improvements not contained therein be provided by Landlord, such
request must be in writing from a duly authorized representative of Tenant and
agreed to by Landlord. Landlord shall then advise Tenant in writing of the cost
associated with said additional improvements and shall not proceed to provide
said additional improvements until authorized to do so in writing by the duly
authorized representative of Tenant. Within thirty(30) days of completion of the
Tenant Improvements in their entirety, Tenant shall pay to Landlord the costs of
all such additional improvements. The Tenant Improvements shall be deemed
complete upon issuance of a "Certificate of Occupancy" (or its local equivalent)
by the appropriate local governmental agency or agencies.
Landlord shall represent, warrant and provide evidence that the air handling
systems within the building are of a satisfactory air quality. Such air quality
testing shall include analyzing the building air handling system to ensure that
any toxin-containing materials or fibers are not circulated or vented into the
premises.
Landlord will be responsible for payment for tests of the system upon completion
of tenant improvements and will be responsible for the repairs and/or
replacement of equipment and/or ducting and/or venting as necessary to
accomplish the foregoing.
Landlord shall warrant that all tenant improvement work performed in the
premises, the roof, the existing HVAC system, windows and seals, and electrical
and plumbing systems and equipment are in good working order as of the date of
lease commencement. In addition, Landlord shall deliver the premises in a
condition that meets all codes and regulations, the Americans With Disabilities
Act (ADA), and any Title 24 requirements as the aforementioned exist as of the
date of the lease.
Tenant will be responsible for costs associated with compliance with the ADA
only for those interior items that may become required subsequent to the date of
the lease. Landlord will be responsible for any such costs associated with
compliance with the ADA on the grounds outside of the premises. Landlord will
not assume responsibility for making the mezzanine level wheelchair accessible.
To the best of Landlord's knowledge, the building does not contain, nor has ever
contained, asbestos containing materials; and there is no current use, storage
or disposal of significant quantities of hazardous materials on the site.
3. Article 18 : Option to Renew: If Tenant is not in default on any of the
----------------
terms, conditions or covenants of this Lease, both on the date Tenant gives
Landlord the renewal notice required below and at the end of the primary term of
this Lease, Tenant shall have the right to renew this Lease for one (1)
additional five (5) year term upon the same terms and conditions contained in
this Lease except: (a) the renewal term will contain one (1) further renewal
option for one (1) additional five (5) year term; (b) no tenant finish or tenant
improvement allowance will be provided to Tenant during the renewal term unless
expressly granted by Landlord in writing; and (c) the Base Rent shall be at the
then prevailing fair market rate and increased annually according to Article
Three of this Lease. If Tenant desires to renew this Lease, Tenant will notify
Landlord of its intention to renew not less than four (4) months prior to the
expiration date of the primary term of this Lease. If Tenant is not in default
on any of the terms, conditions or covenants of this Lease, both on the date
Tenant gives Landlord the renewal notice required below and at the end of the
first option term of this Lease, Tenant shall have the right to renew this Lease
for (1) additional five (5) year term upon the same terms and conditions
contained in this Lease except: (a) the renewal term will not contain any
further renewal option; (b) no tenant finish or tenant improvement allowance
will be provided to Tenant during the renewal term unless expressly granted by
Landlord in writing; and (c) the Base Rent shall be at 90% of the then
prevailing fair market rate increased according to Article Three of this Lease.
If Tenant desires to renew this Lease, Tenant will notify Landlord of its
intention to renew not less than four (4) months prior to the expiration date of
the first option term of this Lease.
4. Article 19 Expansion: Tenant shall be granted a continuous first right of
----------
refusal to lease the remaining portion of the mezzanine level (estimated at
7,200 square feet to be field verified by Landlord's Architect) of the building
at 9174 Sky Park Court throughout the lease term. The terms and conditions for
that expansion space shall be the same as those in effect under the existing
Lease, except as amended by both parties, and at the then prevailing Base Rent
for the premises under this Lease. Tenant Improvements for the expansion area
shall be provided by Landlord and are as shown and described in Exhibits "A,
C and F to this Lease. Any improvements to be made by the Landlord in the
expansion space shall be, at the most, in accordance, and in the same general
nature, quality and type, as is in the Premises covered by this Lease at the
time of commencement of the Lease. If Tenant desires any other nature, quality,
type or other deviation from the primary Tenant Improvements, any additional
costs shall be paid by Tenant. Tenant shall also have a first right of refusal
to lease the premises currently occupied by Konica and located at 9173 Sky Park
Court should Konica vacate the premises. Said right must be exercised within
thirty (30) days of receipt of written notification of the impending lease of
the premises, under the same terms and conditions offered by the prospective
lessee, or this right is invalidated. Tenant shall also have the first right of
opportunity to lease any portion of the remainder of the building at 9173 Sky
Park Court that becomes available for lease under terms and conditions to be
mutually agreed upon by both Tenant and Landlord.
5. Article 20 Dock Well Usage: The dock well between 9173 and 9174 Sky Park
----------------
Court is an open dock and there will be no exclusivity of use by either Tenant
or any tenant in possession of the premises at 9173 Sky Park Court.
6. Article 21 Non-Disturbance: Should the Property be financed or sold during
----------------
the Lease Term, Landlord shall provide, upon written request by Tenant, a duly
executed Non-Disturbance Agreement for the benefit of Tenant from Landlord's
mortgagee or Landlord's successor in interest.
7. Sections 1.05, 2.03 & 3.01
Lease Commencement. Occupancy and Rental Abatement: Tenant shall be granted
- ---------------------------------------------------
approximately one(1) month of early occupancy for fixturization beginning on or
about September 1, 1995 (upon receipt of certificate of occupancy) and the lease
shall commence October 1,1995 with two months of rental abatement during months
2 and 3 (November and December, 1995) of the primary lease term.
8. Sections 1.11 8 4.05(c)
Parking: Tenant will have 131 parking spaces AVAILABLE OF WHICH FOUR (4) WILL BE
- ---------
reserved immediately in front of the premises, the exact location of which to be
mutually agreed upon by Landlord and Tenant, and the remaining 127 will be
unreserved. The entire project has a total of 400 parking spaces with a ratio of
3.7/1000 square feet of net rentable area. Any future expansion will add
unreserved parking to the Tenant's total at that ratio.
9. Section 3.02(a) Base Rent: The minimum increase will be two percent (2%) per
---------
year and the maximum increase will be five per cent (5%) per year.
10. Section 4.04(a) Insurance; Both parties intend for the Landlord's insurance
----------
to provide primary or contributing insurance, as appropriate, in situations in
which the Landlord is responsible for the insurable event.
11. Section 9.01 Assignment and Subletting: Tenant may assign this Lease or
-------------------------
sublease any portion of the Property to any unaffiliated subtenant with the
Landlord's written consent, which shall not be unreasonably withheld or delayed,
as provided in Section 9.05 of this Lease. Any attempted transfer without
consent shall be void and shall constitute a non-curable breach of this Lease.
Section 9.02 Assignment and Subletting: Tenant may assign this Lease or sublease
-------------------------
any portion of the Property to any parent corporation. subsidiary or affiliated
entity without Landlord's consent provided the entity shares at least fifty
percent (50%) common ownership with Tenant ("Tenant's Affiliate"). In such case,
any Tenant's Affiliate shall assume in writing all of Tenant's obligations under
this Lease.
13. Section 5.03 Hazardous Materials: Tenant has set forth on Exhibit G a list
of Hazardous Materials currently used, stored and/or disposed of in the course
of Tenants business as presently conducted, and Landlord hereby consents to such
use, storage and/or disposal. Except as provided in the following sentence,
Tenant may use, store and/or dispose of Hazardous Material, in addition to that
listed on Exhibit G, required in the normal course of its business as presently
conducted, after giving Landlord prior written notice thereof and supplementing
Exhibit G. In the event that Tenant shall propose to introduce, use, store
and/or dispose of additional Hazardous Material on the Property of such kind or
in such quantities that Tenant would be subjected to reporting obligations under
applicable federal, state or local law or regulation, or in the event that
Tenant shall propose to increase its use, storage and/or disposal of the
materials on Exhibit G such that said reporting obligations would apply thereto,
then Tenant shall be required to obtain the prior written consent of Landlord
for such action. Landlord shall exercise this consent right on a reasonable
basis, taking into account the level of environmental risk posed, the importance
of the material to Tenant's business, and the adequacy of Tenant's environmental
compliance procedures. The provisions of this item 13 shall apply to Tenant but
not any assignee or subtenant of Tenant.
Nothing in this agreement concerning Landlord's agreement to Tenant's use of
Hazardous Materials, or to the notice provisions, shall be construed to shift to
Landlord. or to eliminate, any liability, payment or other responsibility owed
by Tenant in connection with the use, storage and/or disposal of Hazardous
Materials. These provisions have been included solely for the purpose of
providing Landlord with information about the operations of Tenant on the
Property, for the purpose of assuring Landlord that Tenant is taking all
possible care in connection with its use, storage and/or disposal of Hazardous
Materials at the Property and for the purpose of establishing an understanding
regarding the parameters of the necessity of Landlord's prior written consent
under certain conditions. Tenant also acknowledges and agrees that its
responsibility for such payments or liabilities extends to Tenant directly in
the event insurance does not cover these payments or liabilities.
Landlord's Initials Tenants Initials
Date: 4/20/95 Date 4/17/95
EXHIBIT "A"
SPECIFICATIONS FOR 9174 SKY PARK COURT, SAN DIEGO
L-BUS TENANT IMPROVEMENTS
DESCRIPTION OF ITEMS ON THE DRAWINGS AT EXHIBIT 'B- TO BE COMPLETED AS PART OF
THE TENANT IMPROVEMENTS AT THE ABOVE ADDRESS. THE STATED WORK TO BE PERFORMED IS
BASED UPON PLANS BY ARCHITECTURE ONE. ALL MATERIALS AND WORKMANSHIP SHAWL BE IN
ACCORDANCE WITH THE LATEST UNIFORM BUILDING CODE EDITION. WITH AMENDMENTS AND
ALL APPLICABLE LOCAL STANDARDS. ALL WORK SHALL BE PERFORMED AS PER ACCEPTABLE
INDUSTRY STANDARDS.
01. DEMOLITION:
A. REMOVAL OF ALL WALLS, CEILING GRID. FLOOR COVERINGS, ETC. IN ORDER TO BUILD
SAID PLANS.
B. SAVE FOR POSSIBLE RE-USE: 1. ALL LIGHTING AND CEILING TILES: 2. DOORS. LOCKS
AND FRAMES: 3. HVAC DUCTWORK, THERMOSTATS AND GRILLS; 4. SPEAKERS, FIRE SYSTEM
PARTS AND EQUIPMENT: S. CABINETS (2 SINK COUNTERS, 1 FRONT RECEPTION COUNTER).
C. REMOVAL OF EXISTING UNISEX RESTROOM IN THE WAREHOUSE SPACE. THE REMAINING
FOUR EXISTING MEN'S AND WOMEN'S RESTROOMS TO REMAIN AS IS (TO BE CLEANED AS PART
OF CONSTRUCTION CLEAN-UP).
02. EXISTING AREAS TO BE RETAINED AND PROTECTED FROM DAMAGE DURING CONSTRUCTION:
A. EXISTING FIRE CORRIDOR T0 REMAIN AND BE MODIFIED PER PLANS AND CODE
REQUIREMENTS.
B. EXISTING ELECTRIC ROOMS, ELECTRIC PANELS, PHONE ROOMS AND PHONE PANELS TO
REMAIN FOR POSSIBLE REUSE AS PER PLANS AND CODE.
C. EXISTING STAIRCASES TO REMAIN. MODIFICATION AS PER PLANS AND CODE.
D. NO DEMOLITION OR MODIFICATIONS SHALL BE PROVIDED FOR THE EXTERIOR OF THE
BUILDING, THE SAN DIEGO GAS & ELECTRIC ROOM. THE OUTSIDE GROUNDS OR THE PARKING
LOT AS PART OF THESE TENANT IMPROVEMENTS UNLESS STATED HEREIN OR AS PART OF
ADDITIONAL WORK ELECTED TO 3E PERFORMED AND PAID FOR BY TENANT AS AN OPTION AS
OUTLINED IN ITEM 18.
03. VENTILATION:
A. POWERED EXHAUST FAN(S), THERMOSTATICALLY CONTROLLED. FOR STOCK AREA #76 AND
RECEIVING AREA #75 AS PER PLANS AND CODES.
9. EXHAUST VENTING FOR ROOMS #43 AND #51 (750-1000 CFM).
C. THERMOSTATICALLY CONTROLLED EXHAUST VENTING FOR ROOMS #68 AND #71.
D. FORCED DRAFT VENTILATION FOR UPPER LEVEL RESTROOMS (AIR CHANGE EVERY 5
MINUTES).
E EXISTING ROOF EXHAUST FAN ON UPPER LEVEL TO REMAIN, TO BE THERMOSTATICALLY
CONTROLLED (LOCATION TO BE DETERMINED BY BUILDING OWNER).
F. HOOK UP OF TENANT'S ESS CHAMBER VENTING (ROOM #70) TO ROOF VENT.
04. AIR CONDITIONING AND HEATING, TO BE INSTALLED IN ACCORDANCE WITH THE LOCAL
HVAC CODE REQUIREMENTS AND S.M.A.C.N.A.:
A. EXISTING HEAT PUMP UNITS TO BE REDUCED AS PER PLANS AND CODES.
B. EXISTING SUPPLY AND RETURN GRILLS TO BE CLEANED AND REPAINTED AS NECESSARY,
THEN REUSED WHERE POSSIBLE ON FIRST LEVEL ONLY.
C. EXISTING THERMOSTATS TO BE RELOCATED WHERE POSSIBLE ON FIRST LEVEL.
D. ROOFTOP GAS HEAT PUMP UNIT(S) FOR NEW OCCUPIED AREAS, THERMOSTATICALLY
CONTROLLED. SYSTEM(S) SHALL BE DESIGNED FOR LOADS AND IN ACCORDANCE WITH ASHRAE
AND TITLE 24 STANDARDS WITH INSULATED SUPPLY AND RETURN DUCT WORK AND ALL
NECESSARY GRILLS AND REGISTERS AS PER PLANS AND CODES.
E. GAS HEAT UNIT(S) FOR RECEIVING AREA #75 AND STOCK AREA #76 AS PER PLANS AND
CODES.
F. GAS HEAT UNIT(S) FOR BURN IN ROOMS #68 AND #71 AS PER PLANS AND CODES.
G. DEDICATED UNIT(S) OR ZONES FOR QA LAB ROOM #36. ENGINEERING LAB ROOM #40.
CAFETERIA #39 AND NETWORK ROOM #21 (ONE SUPPLY DUCT TO ROOM #67 FROM ROOM #21)
AS PER PLANS AND CODES.
H. GAS PIPING TO NEEDED LOCATIONS AS PER PLANS AND CODES.
I. NO SUPPLY OR RETURN DUCTING TO HALLWAYS.
J. NO AIR CONDITIONING TO STOCK AREA #76 OR RECEIVING AREA #75.
K. STANDARD HUMIDITY CONTROL FOR AREAS #72, #73 AND #74.
05. INSULATION:
A R19 INSULATION UNDER THE ROOF FOR STOCK AREA 476 AND RECEIVING AREA #75.
B. R11 INSULATION ABOVE CEILING TILES IN AREAS #73 AND #74.
C. R11 INSULATION FOR NEW AREA SEPARATION WALLS.
D. R11 INSULATION IN NEW WALLS FOR ROOMS #21, t36, 440, #6B, #70 AND #71.
E. R11 INSULATION IN NEW WALLS FOR WINDOW OFFICES. CONFERENCE ROOM, RESTROOMS
AND WALLS SEPARATING
UNOCCUPIED AREA ON THE UPPER LEVEL
F. R19 INSULATION UNDER THE ROOF ABOVE THE UPPER LEVEL OCCUPIED SPACE.
G. R11 INSULATION ABOVE THE CEILING TILES IN ANY OTHER OFFICE AREAS OPEN TO THE
ROOF.
H. INSULATION PLACED AROUND THE DRAIN PIPING WITHIN THE WALLS IN ORDER TO REDUCE
THE NOISE IN CONFERENCE ROOMS #28 AND #104.
06. FIRE SPRINKLERS:
A RE-PIPE UPPER AND LOWER LEVELS AS PER PLANS AND CODE REQUIREMENTS.
B. HONEYWELL PROTECTION SERVICES I HONEYWELL, INC. (OR APPROVED COMPANY) TO TEST
AND MONITOR FIRE SPRINKLING SYSTEM UPON COMPLETION AND ON A REGULAR BASIS (TO BE
PAID FOR BY BUILDING OWNER). THIS DOES NOT INCLUDE TENANT'S SECURITY OR FIRE
SYSTEM(S).
07. SUSPENDED CEILINGS:
A APPROXIMATELY 24,000 SQUARE FEET OF NEW CEILING GRID.
B. ALL NEW TILES IN UPPER FLOOR AREAS (#769 CORTEGA TILES BY ARMSTRONG). REUSE
OF EXISTING CEILING TILES AND
REMAINING NEW TILES ON LOWER LEVEL
C. TEN (10) FOOT CEILING GRID HEIGHT IN AREAS #73 AND 74 AS PER PLANS AND
CODES.
D. AREA #72 TO BE LEFT OPEN TO THE FLOOR ABOVE. CEILING GRID DROP DOWN TO AREA
t73 (TEN (10) FOOT) TO BE MADE AT LOCATION OF THE END OF THE MEZZANINE LEVEL
ABOVE.
EXHIBIT A
PAGE 2
E. ALL OTHER LOWER LEVEL AREAS TO REMAIN AT EXISTING HEIGHT AS PER PLANS AND
CODES.
F CEILING GRID TO BE AT AN EIGHT(a) FOOT HEIGHT (OR AS CLOSE AS POSSIBLE) ON THE
UPPER LEVEL. BOXING IN ANY
BEAMS OR DRAINS FALLING BELOW THE GRID.
G. CEILING GRID TO BE CONTINUOUS WITH WALLS CONSTRUCTED UNDER THE GRID EXCEPT IN
FIRE CORRIDORS OR AS
PLANS OR CODES DIRECT.
H. LOBBY AREA #66 AND UPPER FLOOR HALLWAYS TO BE AN UPGRADED 2X4 CEILING TILE AS
AGREED UPON BY BOTH PARTIES.
oat WALLS:
A PART OF EXISTING FIRE CORRIDOR TO REMAIN AS PER PLANS AND CITY CODE
REQUIREMENTS.
B. FLOOR TO ROOF WALLS THAT DIVIDE AREAS TO REMAIN AS PER PLANS AND CODES.
C. WALLS AROUND RESTROOMS AND STAIRCASES TO REMAIN AS PER PLANS AND CODES.
D. EXISTING WALLS TO REMAIN SHALL BE PATCHED AND PAINTED AS PER PLANS.
E. WALLS TO BE BUILT UNDER CEILING GRID EXCEPT IN FIRE CORRIDORS, OR AS PLANS
AND CODES DIRECT.
F. WALLS TO BE OF STANDARD BUILDING CONSTRUCTION AS PER PLANS AND CODES.
09. PLUMBING:
A. EXISTING RESTROOM PLUMBING TO REMAIN AS IS.
B. SUPPLY WATER AND WASTE LINES TO BE PIPED TO CAR-TERM ROOM #39. EXISTING SINK
COUNTER TO BE INSTALLED AND CONNECTED WITH A GARBAGE DISPOSAL AS PER PLANS AND
CODES.
C. SUPPLY WATER AND WASTE LINES TO BE PIPED TO BREAK AREA ROOM #109. EXISTING
SINK COUNTER TO BE INSTALLED AND CONNECTED WITH A GARBAGE DISPOSAL AS PER PLANS
AND CODES.
D. SUPPLY WATER AND WASTE LINES TO BE PIPED TO UPPER LEVEL RESTROOMS AS PER
PLANS AND CODES.
E. SUPPLY AND INSTALL IN UPPER LEVEL RESTROOMS: 5 - WATER CLOSETS. 1 - URINAL 2
- - FLOOR DRAINS. 2 - SINKS / COUNTERS (UPGRADED FIXTURES).
F SUPPLY AND INSTALL WATER LINES, WASTE LINES AND DRINKING FOUNTAIN TO ONE
LOCATION ON THE LOWER LEVEL AND TO ONE LOCATION ON THE UPPER LEVEL AS PER PLANS
AND CODES.
G. PLUMBING, PIPING, BACKFLOW PREVENTION, INDUSTRIAL WASTE DEVICES, EQUIPMENT.
KITCHEN APPLIANCES. INSTALLATION AND CONNECTIONS FOR ANY MECHANICAL EQUIPMENT
ARE NOT INCLUDED IN THIS AGREEMENT UNLESS SHOWN ON EXHIBIT 'B' OR SPECIFIED
HEREIN.
10. ELECTRICAL
A. EXISTING ELECTRIC ROOM, SUB PANELS AND SAN DIEGO GAS & ELECTRIC AREAS TO
REMAIN AND BE USED AS PER PLANS
AND CODE REQUIREMENTS.
B. EXISTING ELECTRICAL OUTLETS IN UTILIZED WALLS TO REMAIN AND BE USED AS PER
PLANS AND CODES.
C. SUPPLY AND INSTALL BUILDING STANDARD SWITCHES AS NEEDED AND CONVENIENCE
OUTLETS WITH A MINIMUM OF 3 OUTLETS PER STANDARD SIZE OFFICE AS INDICATED ON
PLANS. SUPPLY AND INSTALL ALL REQUIRED CIRCUITS. WIRING. CONDUIT AND PANELS IN
STRICT ACCORDANCE WITH APPLICABLE CODES AND REGULATORY AGENCIES.
D. WIRING AND HOOK UP TO NEW HEAT PUMPS AND EXHAUST FANS PER PLANS AND CODES.
E. WIRING AND HOOK UP TO EXISTING AND NEW LIGHT FIXTURES AS PER PLANS AND CODES.
F. SUPPLY 110V HOOK UP FOR TENANT'S U.P.S. SYSTEM AS PER PLANS AND CODES.
G. DISCONNECT AND HOOK UP TENANTS 480 TRANSFORMER TO ESS CHAMBER AS PER PLANS
AND CODES.
H. SUPPLY AND HOOK UP ONE (1) -112 KVA- 208 TO 230 TRANSFORMER WITH ONE (1) 200
AMP 3 PHASE 4 WIRE 120VTO 230V PANEL TO SUPPLY POWER TO THE OA LAB #36, BURN IN
ROOM #68. AT&T BURN IN ROOM #71, SHIPPING IN AREA #72, HIPOT TEST & TEST RACKS
IN AREA #73. SUB-ASSEMBLY IN AREA #74, RMA IN AREA # 75.
1. DISCONNECT AND HOOK UP TENANTS AIR COMPRESSOR TO 208V AS PER PLANS AND CODES.
J. SUPPLY 208V HOOK UP TO TENANTS FORKLIFT CHARGERS (THREE (3) MAXIMUM) AS PER
PLANS AND CODES. K. SUPPLY AND INSTALL ONE (1) DUPLEX AT EACH DRINKING FOUNTAIN
LOCATION (2).
L SUPPLY ONE (1 ) DEDICATED 15 AMP CIRCUIT AND ONE (1 ) 20 AMP CIRCUIT WITH
STANDARD OUTLET FOR COPY MACHINES AT LOCATIONS PER PLANS.
M. SUPPLY A MINIMUM OF ONE 1/2- RIGID CONDUIT DROP FOR EACH OFFICE AND EACH AREA
IN LOCATIONS SPECIFIED ON PLANS FOR TELEPHONE AND NETWORK CABLING, NOT TO EXCEED
200 DROPS.
N. ELECTRICAL / TELEPHONE CHASEWAY FOR THE UPPER LEVEL TO BE LOCATED NEAR LOBBY
STAIRWELL NEW ELECTRICAL SUB PANEL TO BE SIZED FOR FUTURE OFFICE OCCUPATION OF
UPPER LEVEL
O. MECHANICAL EQUIPMENT. APPLIANCES, INSTALLATION AND CONNECTIONS FOR ANY
MECHANICAL EQUIPMENT OR APPLIANCES ARE NOT INCLUDED IN THIS AGREEMENT UNLESS
SHOWN ON DRAWINGS OR SPECIFIED HEREIN
P UPON COMPLETION OF CONSTRUCTION, ALL CIRCUIT BREAKERS ARE TO BE LABELED.
a. ADDITIONAL ELECTRICAL SPECIAL HOOK UPS SUPPLIED AS FOLLOWS:
1. NETWORK ROOM #21
7-110V QUAD BOXES MOUNTED 4 FEET OFF THE FLOOR, 7 CIRCUITS, 20 AMP BREAKERS OR
AS PLANS OR CODES REQUIRE
Z. QA LAB #36
20 110V QUAD BOXES MOUNTED 4 FEET OFF THE FLOOR. 20 CIRCUITS, 20 AMP BREAKERS
OR AS PLANS OR CODES REQUIRE.
2 - 230V QUAD BOXES MOUNTED 4 FEET OFF THE FLOOR, 2 CIRCUITS, 20 AMP BREAKERS OR
AS PLANS OR CODES REQUIRE
3. ENGINEERING LAB #40
9 - 110V 1OV QUAD BOXES MOUNTED 4 FEET OFF THE FLOOR, 6 CIRCUITS, 20 AMP
BREAKERS OR AS PLANS OR CODES REQUIRE.
1 - 110V DEDICATED CIRCUIT WITH A DUPLEX BOX MOUNTED 4 FEET OFF THE FLOOR, 1
CIRCUIT, 30 AMP BREAKER OR AS PLANS OR CODES REQUIRE.
4, PRINTER PLOTTER ROOM #51
4 - 110V QUAD BOXES MOUNTED 4 FEET OFF THE FLOOR, 4 CIRCUITS. 15 AMP BREAKERS OR
AS PLANS OR CODES REQUIRE.
POWER AS NEEDED FOR EXHAUST FANS AS PER PLANS AND CODES.
S. PHONE ROOM #67
4 - 110V QUAD BOXES MOUNTED 4 FEET OFF THE FLOOR, 4 CIRCUITS, 15 AMP BREAKERS OR
AS PLANS OR CODES REQUIRE.
EXHIBIT A PAGE 3
6. BURN IN AT&T ROOM #71
20 - 110V DUPLEX BOXES MOUNTED UNDER CONVEYOR LINE, 20 CIRCUITS, 20 AMP BREAKERS
OR AS PLANS OR CODES REQUIRE.
1 - 230V QUAD BOX 1 CIRCUIT. 40 AMP BREAKER AS PLANS OR CODES REQUIRE.
POWER AS NEEDED FOR EXHAUST FAN AND HEATING AS PER PLANS AND CODES.
7. BURN IN ROOM #68
15 - 11 0V QUAD BOXES MOUNTED 4 FEET OFF THE FLOOR. 15 CIRCUITS, 20 AMP BREAKERS
OR AS PLANS OR CODES REQUIRE
2 - 230V QUAD BOXES MOUNTED 4 FEET OFF THE FLOOR, 2 CIRCUITS, 20 AMP BREAKERS OR
AS PLANS OR CODES REQUIRE POWER AS NEEDED FOR EXHAUST FAN AND HEATING AS PER
PLANS AND CODES.
a. ADDITIONAL 230V CIRCUITS WITH LOCATIONS TO BE DETERMINED ON PLANS
1 - 15 AMP IN SHIPPING AREA #72
2 - 20 AMP IN AREA #73 FOR HIPOT TEST AND TEST RACKS
1 -15 AMP IN SUB-ASSEMBLY AREA #74
1 - 15 AMP IN RMA AREA #75
11. LIGHTING:
A. SUPPLY AND INSTALL LIGHT FIXTURES (UP TO A MAXIMUM OF 435) ON THE UPPER AND
LOWER LEVELS, REUSING EXISTING
LIGHT FIXTURES WHERE POSSIBLE, PER PLANS, CODES AND TITLE 24 REQUIREMENTS.
B. PROVIDE DUAL SWITCHING (A B) WHERE REQUIRED BY CODE,
C. EMERGENCY LIGHTING AS PER PLANS, CODES AND TITLE 24 REQUIREMENTS.
D. NIGHT LIGHTING AS PER PLANS AND CODES.
E. EGG CRATE STYLE LENS FOR LOBBY ENTRY AREA, UPPER LEVEL HALLS AND UPPER LEVEL
WINDOW OFFICES AS PER PLANS AND CODES.
F. LOWER LEVEL FIXTURES TO BE ARRANGED TO PROVIDE ABOVE AVERAGE LIGHTING WITHIN
TITLE 24.
12. INSIDE FENCING:
A. RECEIVING AREA #75 AND STOCK AREA #76 FULL HEIGHT AS POSSIBLE PER PLANS.
B. FENCING IN AREAS #73 AND #74 10 FOOT HEIGHT UNDER CEILING GRID AS PER PLANS.
C. REUSE TENANT'S EXISTING FENCING AS POSSIBLE.
13. WALL COVERINGS:
A. PAINT WALLS WITH 2 COATS FRAZEE FLAT (COLOR TO BE DETERMINED).
B. EXISTING AND NEW RESTROOMS, CAFETERIA #39 AND BREAK ROOM #109 PAINTED WITH 2
COATS OF FRAZEE SEMI-GLOSS
(COLOR TO BE DETERMINED).
C. WALLPAPER - 50 ROLLS AT 540.00 PER ROLL (LOCATIONS TO BE DETERMINED).
14. DOORS AND FRAMES:
A. REUSE EXISTING DOORS AND FRAMES, HARDWARE AND HANDLES ON LOWER LEVEL AS
POSSIBLE PER PLANS AND FIRE CODE REQUIREMENTS.
B. NEW DOORS AND FRAMES ON UPPER LEVEL TO MATCH STYLE OF LOWER LEVEL AS PER
PLANS AND FIRE CODE REQUIREMENTS.
C. NEW SCHLAGE LEVER 'D' DOOR HANDLES TO MATCH EXISTING PER PLANS AND ADA
REQUIREMENTS.
D. 2-FIRE HOLD OPEN DOORS WITH 6'0- X 8' 0" FRAMES OR AS PLANS OR FIRE CODES
REQUIRE TO BE USED AS PASSAGE THROUGH FIRE CORRIDOR BETWEEN AREAS #73 AND #74.
E. RELOCATE THE ONE DOUBLE ENTRY DOORS TO STAIRCASE ENTRY AS PER PLANS AND
CODES.
15. FLOOR COVERINGS:
A. FURNISH AND INSTALL ATLAS BROOKSTONE OR EQUIVALENT GLUE DOWN, APPROXIMATELY
1,800 SQUARE YARDS AT APPROXIMATELY 518.00 PER YARD.
B. FURNISH AND INSTALL ARMSTRONG VCT TILES IN CAFETERIA #39, BREAK ROOM #109,
AREAS #72, #73 AND #74, APPROXIMATELY 10.000 SQUARE FEET AT $1.00 PER SQUARE
FOOT.
C. FURNISH AND INSTALL 4 INCH VINYL BASE. APPROXIMATELY 4500 LINEAR FEET.
D. FURNISH AND INSTALL CERAMIC TILE UPGRADE TO UPPER LEVEL RESTROOM WITH
APPROXIMATELY 342 SQUARE FEET OF FLOORING AND APPROXIMATELY 420 SQUARE FEET OF
WAINSCOT WALLS AT APPROXIMATELY S18.00 PER SQUARE FOOT.
E. PREPARE, CLEAN AND CLEAR SEAL AREAS #75 AND #76 NOT TO EXCEED S0.55 PER
SQUARE FOOT.
F. CARPET THE NETWORK ROOM #21, OA LAB #36 AND ENGINEERING LAB #40 WITH AN ESD
MATERIAL AS PER PLANS NOT TO EXCEED $4.00 PER SQUARE FOOT INSTALL ED.
16. AIR COMPRESSOR:
A. DISCONNECT AND HOOK UP TENANT'S AIR COMPRESSOR AS PER PLANS AND CODE.
B. HANG APPROXIMATELY 450 LINEAR FEET OF 3/4 INCH GALVANIZED PIPE ABOVE THE
CEILING GRID.
C. 20 - CAPPED TEE LOCATIONS TO BE DETERMINED BY TENANT FOR 1/2 INCH OR LESS
DROPS AND FUTURE USE.
D. 10 - DROPS WIRE 1/2 INCH OR LESS LINES WITH A SHUT OFF VALVE AND 1 QUICK
DISCONNECT FITTING AT EACH LOCATION.
E. 2 - DIRECT HOOK UPS TO ESS CHAMBER ROOM #70 AND AT&T ASSEMBLY LINE IN AREA
#73 AS PER PLANS AND CODES.
17. MISCELLANEOUS ITEMS:
A. FURNISH AND INSTALL 1 10' X 10' ROLLING STEEL OVERHEAD DOOR, CHAIN OPERATION,
TO MATCH EXISTING AT AREA #72 LOADING DOCK LOCATION (REMOVAL OF GLASS AND
FRAMING).
B. FURNISH AND INSTALL 32 BLINDS FOR THE WINDOWS ON THE UPPER LEVEL WITH AN
ALLOWANCE OF S3,000.00.
C. MODIFY EXISTING ENTRY COUNTER FOR NEW ENTRY AREA LOBBY #66.
D. SUPPLY AND INSTALL 2X4 METAL FRAMED WALL WITH 1/2 INCH PLYWOOD ON THE OUTSIDE
AND DRYWALL ON THE INSIDE TO BE INSTALLED IN FRONT OF AND INSIDE OF ALL WINDOWS
IN THE RECEIVING AREA #75 AND STOCK AREA #76.
E. MODIFY EXISTING STAIRCASE BY REMOVING TWO LOWER STAIRS IN FRONT OF THE ENTRY
DOORS TO MAKE A LARGER ENTRY HALL BUILD MATCHING HALL WALL IN REMOVED STAIR
LOCATION.
F. SUPPLY AIR QUALITY TEST UPON COMPLETION OF CONSTRUCTION.
H. FRAMING SUPPORT ON TOP OF THE ROOF FOR ESS CHAMBER CONDENSER UNIT (CONSISTING
OF 2 - 6X5 BEAMS. IF CODE REQUIRES ADDITIONAL SUPPORT. TENANT TO PAY FOR
ADDITIONAL COST.
1. ONE MIRROR (MINIMUM) TO BE INSTALLED IN EACH UPPER LEVEL RESTROOM WITH
MINIMUM FOUR (4) FOOT WIDTH.
J. SUPPLY AND INSTALL 1 - 4'X 9' 1/2' PLYWOOD BACKBOARD IN ROOM #21 FOR PHONE
EQUIPMENT.
EXHIBIT A
PAGE 4
K. UPON COMPLETION OF CONSTRUCTION, CLEAN UP AND WAX WITH A STANDARD COMMERCIAL
JANITORIAL FLOORWAX
ROOMS #39 & #109 AND AREAS #72, #73 & #74.
L PROVIDE ALL SIGNS, RAMPS AND STRIPPING FOR DISABLED PARKING AND BUILDING
ACCESS.
M. OWNER TO PROVIDE ANY SCRAP CARPETING MATERIAL AND 80 TO 100 SQUARE FEET OF
VCT TILE FOR FUTURE MAINTENANCE
18. OPTIONS (SUPPLIED UPON SIGNED CHANGE ORDER FOR ADDITIONAL COSTS AND TIME):
A STEELCASE FURNITURE FOR OPEN SPACE.
B ANY OVERTIME PAY FOR COMPLETION EARLIER THAN STATED WITHIN THE LEASE. ANY
OVERTIME PAY TO COMPLETE ADDITIONAL WORK NOT INCLUDED HEREIN.
C. CONCRETE RU ED REMOVABLE POSTS.
D. MEN'S AND WOMEN'S SHOWERS.
E. PLANTERS.
F. ANY UPGRADES OTHER THAN THOSE STATED HEREIN.
G. SECURITY SYSTEM FOR TENANT S USE.
H. ANY SEPARATE FIRE SYSTEM IN ADDITION TO EXISTING.
I. SIGNAGE.
J. TELEPHONES AND SYSTEMS.
K NETWORK AND SYSTEMS.
L MOVING OF TENANT'S EQUIPMENT OR FURNITURE.
M. MOVING OF TENANT'S ESS CHAMBER OR CONDENSER.
N. INSTALL AN ELEVATED PLATFORM ON THE ROOF TO SUPPORT THE ESS CHAMBER CONDENSER
UNIT TO MATCH EXISTING AIR CONDITIONING UNITS.
O. PROVIDE ELECTRICAL OUTLET OR SERVICE FOR I-BUS SIGN ABOVE ROOM #28.
EXHIBIT "E"
BUILDING RULES AND REGULATIONS
SKY PARK CENTRE
1. Tenant shall not suffer or permit the obstruction of any Common Areas,
including driveways, walkways and stairways.
2. Landlord reserves the right to refuse access to any persons Landlord in good
faith judges to be a threat to the safety, reputation or property of the Project
and its occupants.
3. Subject to Section 1.06 of the lease (the use clause), Tenant shall not make
or permit any unreasonable noise or odors that annoy or interfere with other
tenants or persons having business within the Project.
4. Tenant shall not keep animals or birds within the Project, and shall not
bring bicycles, motorcycles or other vehicles into areas not designated as
authorized for same.
5. Tenant shall not make, suffer or permit litter except in appropriate
receptacles for the purpose.
6. Tenant shall be responsible for the inappropriate use of any toilet rooms,
plumbing or other utilities. No foreign substances of any kind are to be
inserted therein.
7. Tenant shall not deface the walls, partitions or other surfaces of the
premises or Project.
8. Tenant shall not suffer or permit anything in or around the Premises or
Building that causes excessive vibration or floor loading in any part of the
Project.
9. Tenant shall not employ any service or contractor for construction services
or work to be performed to the Premises, except as approved by Landlord.
10. Tenant shall return all keys at the termination of its tenancy and shall be
responsible for the cost of replacing any keys that are lost.
11. Tenant shall be responsible for securely locking any doors that it may have
opened for entry,.
12. No exterior window coverings, shades or awnings shall be installed by
Tenant.
13. No Tenant, employee or invitee shall go upon the roof of the Premises.
14. Tenant shall not suffer or permit smoking or carrying of lighted cigars or
cigarettes in areas reasonably designated by Landlord or by applicable
governmental agencies as non-smoking areas.
15. Tenant shall not use any method of heating or air conditioning other than as
provided by Landlord.
16. The Premises shall not be used for lodging.
17. Tenant shall comply with all safety, fire protection and evacuation
regulations established by Landlord or any applicable governmental agency.
18. Landlord reserves the right to waive any one of these rules and regulations
and/or as to any particular tenant, and any such waiver shall not constitute a
waiver of any other rule or regulation or any subsequent application thereof to
such tenant.
19. Tenant assumes all risks from theft or vandalism and agrees to keep its
Premises locked as may be required.
20. Landlord reserves the right to make such other reasonable rules and
regulations as it may from time to time deem necessary, for the appropriate
operation and safety of the Project and its occupants. Tenant agrees to abide by
those and such rules and regulations.
PARKING RULES
1. Tenant shall not permit or allow any vehicles that belong to or are
controlled by Tenant or Tenants employees, suppliers, shippers, customers or
invitees to be loaded, unloaded or parked in areas other than those designated
by Landlord for such activities.
2. Users of the parking area will obey all posted signs and park only in the
areas designated for vehicle parking.
3. Unless otherwise instructed, every, person using the parking area is required
to park and lock their own vehicle. Landlord will not be responsible for any
damage to vehicles, injuries, to persons or loss of property, all of which risks
are assumed by the party using the parking area.
4. The maintenance, washing, waxing or cleaning of vehicles in the parking area
is prohibited.
5. Tenant shall be responsible for seeing that all of its employees, agents and
invitees comply with the applicable parking rules, regulations, laws and
agreements.
6. Landlord reserves the right to modify these rules and/or adopt such other
reasonable and nondiscriminatory rules and regulations as it may deem necessary
for the proper operation of the parking area.
7. Such parking use as is herein provided is intended merely as a license only
and no bailment is intended or shall be created hereby.
2
EXHIBIT F
WORK LETTER AGREEMENT
Landlord and Tenant are executing, simultaneously with this Work Letter
Agreement, an
Industrial Real Estate Lease ("Lease") covering certain premises in a building
located at 9174 Sky Park Court, San Diego, CA ("Premises"). This Work Letter
Agreement is a part of the lease and shall be subject to all of its terms and
conditions, including all definitions contained in the Lease and shall apply to
all expansion space becoming a part of the Premises by Tenant's exercise of
expansion options under the Lease.
1. REPRESENTATIVES:
Landlord appoints Landlord's Representative to act for Landlord and Tenant
appoints Tenant's Representative to act for Tenant in all makers covered by this
Work Letter Agreement. All inquires, requests, instructions, authorizations and
other communications with respect to the makers covered by this Work Letter
Agreement will be made to Landlord's Representative or Tenant's Representative,
as the case may be. Either party may change its respective Representative under
this Work Letter Agreement at any time with prior written notice to the other
party.
Tenant's Representative: John Selby, Maxwell Labs
Tenant Contact: Dick Dysktra, Maxwell Labs
Landlord's Representative: David Kirchner, Cody Three
Landlord's Contact: Jay Sheppard, Pomona Management Group
Landlord's Architect: Robert Laird, Architecture One
2. TENANT IMPROVEMENTS
2.1 Plans & Specifications: The Tenant Improvements shall be constructed
------------------------
pursuant to plans and specifications prepared in accordance with Paragraph 3.1
of this Work Letter Agreement by Landlord's Architect("Architect"). The scope of
the work to be included in the plans and specifications will be consistent with
the space plans that are attached to the Lease as Exhibits "B" and "C" and the
specifications that are attached to the Lease as Exhibit "A".
Landlord shall furnish, through the Architect, at its sole cost and expense,
complete plans and specifications required for the construction and installation
of the Tenant Improvements . Such plans shall include, but not be limited to,
partition layout, reflective ceiling plans, electrical outlets, switches and
telephone outlets and locations. Architect will furnish plans to the Landlord's
mechanical, electrical and plumbing engineers ("Engineers"), if applicable, to
enable the Engineers to complete design build drawings which will, when
incorporated with the other plans provided by Architect (in total, "the
Construction Documents"), enable the selected general contractor to secure the
permits necessary for the construction of the Tenant Improvements. All fees
incurred by the Landlord in the preparation of working and permit drawings of
the agreed plans and specifications contained in Exhibits "A", "B" and "C" shall
be the sole expense of Landlord. All costs of any subsequent plan changes
initiated by Tenant ("Additional Work") shall be the sole expense of Tenant.
Upon delivery of plans and specifications, Tenant may provide a list of
potential contractors and subcontractors to be included in the bidding process.
Landlord shall not be bound to use any contractor or subcontractor so described.
2.2 Cost of Tenant Improvement Work: Landlord shall pay all costs associated
---------------------------------
with the design, construction and installation of the Tenant Improvements,
including, but not limited to, costs of preparation of Construction Documents,
all costs of construction labor and materials under the construction contract
with the selected general contractor, fees for permits and licenses paid by the
general contractor to governmental agencies in connection with the Tenant
Improvements, costs of any necessary structural engineering
EXHIBIT F
Page -2
2.3 Tenant Improvement Construction: Landlord shall cause the Tenant
---------------------------------
Improvements to be constructed by a qualified general contractor selected by
Landlord at Landlord's sole expense. The selected general contractor shall
provide a one (1 ) year warranty for all materials and workmanship on the
Premises.
Construction shall commence as soon as possible following the selection of the
general contractor and the obtaining of the required building permits. Landlord
shall be responsible for overseeing the contractor and assuring that the Tenant
Improvements are constructed in accordance with the permitted Construction
Documents.
All Tenant Improvements and the equipment and materials incorporated into the
Tenant Improvements shall materially comply with the Construction Documents and
shall be constructed in a good and workmanlike manner, free from all material
defect in design, materials and workmanship. in compliance with all governmental
and quasi-governmental rules, regulations, laws and building codes.
3. SCHEDULE OF TENANT IMPROVEMENT ACTIVITIES
3.1 Construction Document Preparation: As soon as practicable following lease
-----------------------------------
execution, Architect together with the Engineers will prepare and deliver to
Landlord and Tenant one reproducible copy of the Construction Documents for the
Premises apiece.
3.2 Tenant Comments: Upon receipt of the Construction Documents, Tenant shall
-----------------
review for errors and omissions from the plans and specifications as detailed in
Exhibits "A", "B" and/or "C" of the Lease and forward all comments to Landlord
within five (5) business days of receipt. Failure to notify Landlord of any
comments within the proscribed period shall be deemed approval of such plans.
Landlord and Architect will then have five (5) business days to address and/or
correct any deficiencies and deliver one corrected reproducible copy of the
Construction Documents to Tenant.
3.3 As-Built Documentation: Landlord shall furnish to Tenant, at Landlord's
------------------------
expense, one set of reproducible "as built" plans for ail completed Tenant
Improvements and Additional Work within thirty (30) days after Lease
Commencement.
3.4 Completion and Punch List: Landlord shall be responsible for the
---------------------------
construction of the Tenant Improvements in accordance with the Construction
Documents. Upon Substantial Completion, as defined in Section 6 below, of the
Tenant Improvements, Landlord shall, upon not less than three (3) days' prior
notice, provide Tenant an opportunity to inspect the Premises and the Tenant
Improvements and Additional Work. Tenant will, within three (3) days following
such inspection, develop a "punch list" identifying all corrective work
discovered during such inspection. Such corrective work shall be limited to
those items specified in the Construction Documents or duly authorized Change
Orders. Within ten (10) days after receipt of said punch list, Landlord shall
undertake to correct all punch list items to the reasonable satisfaction of
Tenant. If Landlord fails to take corrective action within such ten (10) day
period, Tenant shall have the right to complete such work and deduct the cost
from the first rent to become due under the Lease.
Within thirty (30) days after Lease Commencement, Tenant can provide to Landlord
a list of latent defects in the Tenant Improvements and Additional Work not
reasonably discoverable during the punch list inspection.
4. TENANT WORK:
All finish work and other work desired by Tenant and not included within the
scope of the Tenant Improvements as set forth in the Construction Documents or
in the Additional Work authorized by a duly executed Change Order, including,
but not limited to, computer systems, telephone systems, telecommunications
systems and other items (the "Tenant Work") shall be furnished installed and
paid for by Tenant. A delay in the installation of any Tenant Work will not
result in any extension of the Lease Commencement Date. Commencement of any
Tenant Work by Tenant shall not constitute acceptance by Tenant of any work by
Landlord or Contractor or a waiver of any rights Tenant may have against
Landlord, Contractor or others with respect to the Tenant Improvements or
Additional Work.
EXHIBIT F
Page -3
4.1 Access and Entry At a time designated by Landlord and Contractor, Landlord
-----------------
agrees to provide reasonable access to the Premises to Tenant and its agents for
the purpose of installing and completing Tenant's cabling related to Tenant's
telephone and telecommunications systems. so long as such access does not
interfere with the conduct of Landlord's construction or affect Landlord's
ability to bring the Premises to Substantial Completion. All other Tenant Work
shall occur during the thirty (30) day period provided to Tenant for
fixturization.
With respect to the Tenant Work, Tenant shall adopt a schedule in conformance
with the schedule of Landlord's Contractor and conduct its work in such a manner
as to maintain harmonious labor relations so as not to interfere with or delay
the work of Landlord's Contractor. Landlord will endeavor to provide Tenant. at
no cost, space in or about the Premises, if available, for the storage and
staging of Tenant's materials. provided that such storage and staging does not
interfere with or delay the work of Landlord's Contractor.
Tenant shall be responsible for providing all insurance and for providing any
necessary security and shall use said space at its sole risk. Tenant agrees to
hold Landlord harmless and indemnify Landlord from and against any and all loss,
liability or cost arising out of or in connection with the use of this storage
space by Tenant. Tenant shall be obligated to remove any of the stored materials
from the storage space prior to the Lease Commencement Date and shall be
responsible to repair any damage or clean up any debris resulting from Tenant's
use of the space.
4.2 Risk of Loss: All materials, work, installations and decorations of any
--------------
nature brought upon or installed in the Premises before Lease Commencement Date
shall be at the risk of the party who brought such materials or items onto the
Premises. Notwithstanding the foregoing, any damage to the Tenant Improvements
and/or the Additional Work caused by Tenant or any party acting on Tenant's
behalf during the thirty (30) day fixturization period shall be at the risk of
Tenant.
Neither Landlord nor any party acting on Landlord's behalf shall be responsible
for any damage or loss or destruction of such items brought to or installed in
the Premises by Tenant prior to Lease Commencement Date, except in the event of
gross negligence or willful misconduct of Landlord, Contractor, or any employee,
agent, subcontractor or other party acting on behalf of Landlord or Contractor.
5. CHANGE ORDERS
Tenant may authorize Additional Work during construction only by written
instructions from Tenant's Representative to Landlord's Representative on a form
to be designated by Landlord ("Request for Information Form"). Within a
reasonable period after receipt of a Request for Information, Landlord will
direct Contractor to prepare and deliver, for Tenant's approval, a not-to exceed
cost estimate setting forth the total cost of such proposed change and the
revised estimated completion date (if such Additional Work will alter the
estimated date for Substantial Completion of Tenant Improvements). Such requests
shall be reasonable in number and nature so as not to interfere with or delay
the work of Landlord's Contractor. Tenant shall assume responsibility for any
Architect's or Engineers' fees related to such a Request for Information, if
their services are needed.
If Tenant's Representative approves such Additional Work in writing, Landlord
will provide a Final Change Order to Tenant for the Additional Work covered by
the Request for Information, provided such work is consistent with the overall
Tenant Improvements and is in compliance with all governmental or quasi-
governmental rules, regulations, laws or building codes. Tenant's Representative
shall sign and date the Final Change Order before Landlord will commence such
Additional Work. If Tenant's Representative fails to approve such Additional
Work in writing within a reasonable time after delivery of the cost estimate,
Tenant will be deemed to have withdrawn the proposed Request for Information and
Landlord will not proceed to perform the Additional Work.
Tenant will pay to Landlord, within thirty (30) days of the Lease Commencement
Date, the total cost of work associated with such Tenant approved Additional
Work.
EXHIBIT F
Page 4
6. SUBSTANTIAL COMPLETION AND LEASE COMMENCEMENT DATE
Substantial Completion or substantially complete shall mean that the Premises
have been approved for occupancy by the City of San Diego Building Inspection
Department and completion of construction of the Tenant Improvements in
accordance with the Construction Documents, with the exception of minor details
of construction, installation, decoration or mechanical adjustments commonly
found on an architectural punch list, none of which materially interfere with
Tenant's use or occupancy of the Premises. Substantial Completion of the Tenant
Improvements shall be deemed to have occurred notwithstanding the requirement to
complete the punch list items or similar corrective work. Landlord agrees that
Tenant's obligation for the payment of rent under the Lease and the Lease
Commencement Date shall not occur until Landlord has substantially completed the
Tenant Improvements and the Premises are suitable for occupancy and delivery in
accordance with Article 17 as described in the First Lease Rider.
Notwithstanding the foregoing, Tenant agrees that if Landlord shall be delayed
in causing such work to be substantially completed as a result of any of the
events below as a ''Tenant Delay", such delay shall be the responsibility of
Tenant and will result in the Lease Commencement Date being the earlier of
either
(i) thirty (30) days after the date of Substantial Completion, or
(ii) thirty (30) days after the date when Substantial Completion would have
occurred if there had been no
Tenant Delay.
The aforementioned thirty (30) days provided to Tenant for fixturization.
For the purposes of this Work Letter Agreement, a Tenant Delay is defined as
follows:
(a) Tenant's failure to furnish any documents or approve any item or cost
estimates as required herein; or
(b) Tenant's request for material, finishes or installations which are not
available on a commercially practicable basis, but only if Landlord has notified
Tenant of such unavailability and Tenant has not approved substitute material
within a reasonable time period; or
(c) Tenant's changes to the Construction Documents; or
(d) Tenant's interference with Landlord's Contractor in such a manner as to
delay the work of Landlord's Contractor, or
(e) Tenant's failure to perform any act or obligation imposed on Tenant by the
Lease or this Work Letter Agreement as and when required, provided, however,
that any of the matters described in subparagraphs (a) through (e), inclusive,
actually cause a delay in completion of construction and Landlord provided
notice to Tenant of such fact and the resulting delay at the time such matters
occurred.
7. MISCELLANEOUS
In the event of any conflict between the terms of this Work Letter Agreement and
the Lease, the terms of this Work Letter Agreement shall control.
Landlord shall indemnify, defend and hold Tenant harmless from and against any
loss or damage which Tenant may incur as the result of any mechanics' liens,
resulting from the Tenant Improvements or Additional Work, attaching to or
encumbering Tenant's leasehold estate under this Lease.
Tenant shall indemnify, defend and hold Landlord harmless from and against any
loss or damage which Landlord may incur as the result of any mechanics' liens,
resulting from the Tenant Work, attaching to or encumbering Landlord's tingle in
the Premises under this Lease.
EXHIBIT F-1
Estimated Schedule of Construction
The following timetable is an estimate of the time necessary to complete
construction of the Tenant Improvements as defined in Exhibits A and B. These
estimates are subject to change due to the provisions of Exhibit F as well as
circumstances beyond the control of Tenant and Landlord (including but not
limited to strikes, acts of God, national emergencies, collectively known as
force majeur). The estimated schedule is as follows from date of lease execution
by both parties:
Electrical Engineering Mechanical Engineering, & Final
Architectural: 4 weeks
Contractor Bidding & Plan Check: 2 weeks
Plan Check Revision: 2 weeks
Construction: 10 weeks
Punch List Corrections: 1 week
Contingency: 1 week
Substantial Completion: Total of Above
Occupancy: Upon Substantial Completion
EXHIBIT "G "
TENANT'S USE OF HAZARDOUS MATERIALS
HAZARDOUS MATERIALS ON PREMISES
Alcohol based solvent Fluxoff, MFG. Chemtronics USAGE: 2 gallons per year
Water based oil residue, caused by draining air compressor., USAGE: 15 gallons
per year.
EXHIBIT "B" - Drawing of Layout for Ground Floor
EXHIBIT "B" - Drawing of Layout for Mezzanine Area
EXHIBIT "C" - Drawing of Layout for Expansion Area - Mezzanine
EXHIBIT "D" - Drawing of Layout for Sky Park Centre