Exhibit 10.4(a)
FIRST AMENDMENT TO OFFICE LEASE
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This FIRST AMENDMENT TO OFFICE LEASE ("First Amendment") is made and
entered into as of November 26, 1996, by and between DELTA TOWERS JOINT VENTURE,
a California general partnership ("Landlord"), and FRANCHISE MORTGAGE ACCEPTANCE
COMPANY, L.L.C., a California limited liability company ("Tenant").
R E C I T A L S:
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A. Landlord and Tenant entered into that certain Office Lease (the
"Lease") dated August 24, 1995, whereby Landlord Leased to Tenant and Tenant
leased from Landlord approximately 1,884 rentable square feet of space commonly
known as Suite 1190 (the "Existing Premises") located on the eleventh (11th)
floor of the building known as One Century Plaza, situated at 2029 Century Park
East, Los Angeles, California.
B. Landlord and Tenant desire to amend the Lease on the Terms and
conditions set forth in this First Amendment.
A G R E E M E N T:
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NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
covenants contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
1. TERMS. All undefined terms when used herein shall have the same
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respective meanings as are given such terms in the Lease unless expressly
provided otherwise in this First Amendment.
2. MODIFICATION OF PREMISES. Landlord hereby leases to Tenant, and Tenant
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hereby leases from Landlord, those certain premises (the "New Premises")
outlined on the floor plan attached hereto and marked Exhibit A-1, said New
Premises being commonly known as Suite 350 and being agreed, for the purpose of
this First Amendment, to have an area of approximately 5,932 rentable (5,126
usable) square feet and to be situated on the third (3rd) floor of the building
known as Two Century Plaza, located at 2049 Century Park east, Los Angeles,
California (the "Building"). As of the "New Premises Commencement Date" as that
term is defined in Section 3.1, below, all references in the Lease, as amended
hereby, to the "Premises" shall be deemed to refer to the New premises instead
of the Existing Premises.
3. TERM OF LEASE.
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3.1 NEW PREMISES. The term ("New Term") of Tenant's lease of the New
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Premises shall commence (the "New Premises Commencement Date") upon the earlier
to occur of (i) the date upon which Tenant first commences to conduct business
in the New Premises, and (ii) the date upon which the New Premises are "Ready
for Occupancy," as that term is defined in Section 5.1 of the Tenant Work Letter
attached hereto as Exhibit B-1 (the "Tenant Work Letter"). The anticipated date
upon which the New Premises shall be Ready for Occupancy is February 1,1997. The
New Term shall expire on the date immediately preceding the fifth (5th)
anniversary of the New Premises Commencement Date.
3.2 EXISTING PREMISES. Upon the New Premises Commencement Date,
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Tenant's lease of the Existing Premises shall automatically terminate and be of
no further force and effect, and Landlord and Tenant shall be relieved of their
respective obligations under the Lease, as amended hereby, in connection with
the Existing Premises, except those obligations of Tenant set forth in the
Lease, as amended hereby, which specifically survive the expiration or earlier
termination of Tenant's lease of the Existing Premises, including, without
limitation, the payment by Tenant of all amounts owed by Tenant under the Lease,
as amended hereby, with respect to Tenant's period of occupancy of the Existing
Premises Tenant shall vacate the Existing Premises, and surrender and deliver
exclusive possession thereof to Landlord on or
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before the New Premises Commencement Date in accordance with the provisions of
the Lease, as amended hereby. In the event that Tenant retains possession of the
Existing Premises or any part thereof after the New Premises Commencement Date,
then the provisions of Article 16 of the Lease shall apply and any amounts
payable by Tenant thereunder shall be computed using the Rent payable for the
last month that the Lease is in effect with respect to the Existing Premises.
4. RENT.
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4.1 BASE RENT. Effective as of the New Premises Commencement Date
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Section 4 of the Summary is hereby deleted and in its place is inserted the
following:
"4. BASE RENT (ARTICLE 3):
Lease Year With Annual Rental Rate
Respect to New Monthly Installment of Per Rentable Square
Premises Annual Base Rent Base Rent Foot
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1-5 $145,927.20 $12,160.60 $24.60
4.2 ADDITIONAL RENT.
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4.2.1 OPERATING EXPENSES. Section 4.2.7 of the Lease, on
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pages 5-8 thereof, is hereby deleted and replaced with the following:
"4.2.7 "OPERATING EXPENSES" shall mean all expenses, costs and
amounts of every kind and nature which Landlord pays or accrues
during any Expense Year because of or in connection with the
ownership, management, maintenance, security, repair,
replacement, restoration or operation of the Project, or any
portion thereof. Without limiting the generality of the
foregoing, Operating Expenses shall specifically include any and
all of the following: (i) the cost of supplying all utilities,
the cost of operating, repairing, maintaining, and renovating the
utility, telephone, mechanical, sanitary, storm drainage, and
elevator systems, and the cost of maintenance and service
contracts in connection therewith; (ii) the cost of licenses,
certificates, permits and inspections and the cost of contesting
any governmental enactments which may affect Operating Expenses,
and the costs incurred in connection with a governmentally
mandated transportation system management program or similar
program; (iii) the cost of all insurance carried by Landlord in
connection with the Project as reasonably determined by Landlord;
(iv) the cost of landscaping, relamping, and all supplies, tools,
equipment and materials used in the operation, repair and
maintenance of the Project, or any portion thereof; (v) the cost
of parking area repair, restoration, and maintenance; (vi) fees
and other costs, including reasonable management fees, consulting
fees, legal fees and accounting fees, of all contractors and
consultants in connection with the management, operation,
maintenance and repair of the Project; (vii) payments under any
equipment rental agreements and the fair rental value of any
management office space; (viii) subject to item (f), below,
wages, salaries and other compensation and benefits, including
taxes levied thereon, of all persons engaged in the operation,
maintenance and security of the Project; (ix) costs under any
instrument pertaining to the sharing of costs by the Project; (x)
operation, repair, maintenance and replacement of all systems and
equipment and components thereof of the Project; (xi) the cost of
janitorial, alarm, security and other services, replacement of
wall and floor coverings, ceiling tiles and fixtures in common
areas, maintenance and replacement of curbs and walkways, repair
to roofs and re-roofing; (xii) amortization (including interest
on the unamortized cost) over the useful life as Landlord shall
reasonably determine of the cost of acquiring or the rental
expense of personal property used in the maintenance,
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operation and repair of the Project, or any portion thereof;
(xiii) the cost of capital improvements or other costs incurred
in connection with the Project (A) which are intended to effect
economies in the operation or maintenance of the Project, or any
portion thereof, (B) that are required to comply with present or
anticipated conservation programs, (C) which are replacements or
modifications of nonstructural items located in the Common Areas
required to keep the Common Areas in good order or condition, or
(D) that are required under any governmental law or regulation by
a federal, state or local governmental agency, except for capital
repairs, replacements or other improvements to remedy a condition
existing prior to the Lease Commencement Date which an applicable
governmental authority, if it had knowledge of such condition
prior to the Lease Commencement Date, would have then required to
be remedied pursuant to the then-current governmental laws or
regulations in their form existing as of the Lease Commencement
Date and pursuant to the then-current interpretation of such
governmental laws or regulations by the applicable governmental
authority as of the Lease Commencement Date; provided, however,
that any capital expenditure shall be amortized (including
interest on the amortized cost) over its useful life as Landlord
shall reasonably determine; and (xiv) costs, fees, charges or
assessments imposed by, or resulting from any mandate imposed on
Landlord by, any federal, state or local government for fire and
police protection, trash removal, community services, or other
services which do not constitute "Tax Expenses" as that term is
defined in Section 4.2.8, below. Notwithstanding the foregoing,
for purposes of this Lease, Operating Expenses shall not,
however, include:
(a) costs, including marketing costs, legal fees, space
planners' fees, advertising and promotional expenses, and
brokerage fees incurred in connection with the original
construction or development, or original or future leasing of the
Project, and costs, including permit, license and inspection
costs, incurred with respect to the installation of tenant
improvements made for new tenants in the Project or incurred in
renovating or otherwise improving, decorating, painting or
redecorating vacant space for tenants or other occupants of the
Project (excluding, however, such costs relating to any common
areas of the Project or parking facilities);
(b) except as set forth in items (xii), (xiii), and (xiv)
above, depreciation, interest and principal payments on mortgages
and other debt costs, if any, penalties and interest, costs of
capital repairs and alterations, and costs of capital
improvements and equipment;
(c) costs for which the Landlord is reimbursed by any
tenant or occupant of the Project or by insurance by its carrier
or any tenant's carrier or by anyone else, and electric power
costs for which any tenant directly contracts with the local
public service company;
(d) any bad debt loss, rent loss, or reserves for bad debts
or rent loss;
(e) costs associated with the operation of the business of
the partnership or entity which constitutes the Landlord, as the
same are distinguished from the costs of operation of the Project
(which shall specifically include, but not be limited to,
accounting costs associated with the operation of the Project).
Costs associated with the operation of the business of the
partnership or entity which constitutes the Landlord include
costs of partnership accounting and legal matters, costs of
defending any lawsuits with any mortgagee (except as the actions
of the Tenant may be in issue), costs of selling, syndicating,
financing, mortgaging or hypothecating any of the Landlord's
interest in the Project and costs incurred in connection with any
disputes between Landlord and its employees,
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between Landlord and Project management, or between Landlord and
other tenants or occupants, and Landlord's general corporate
overhead and general and administrative expenses;
(f) the wages and benefits of any employee who does not
devote substantially all of his or her employed time to the
Project unless such wages and benefits are prorated to reflect
time spent on operating and managing the Project vis-a-vis time
spent on matters unrelated to operating and managing the Project;
provided, that in no event shall Operating Expenses for purposes
of this Lease include wages and/or benefits attributable to
personnel above the level of Project manager or Project engineer;
(g) amount paid as ground rental for the Project by the
Landlord;
(h) except for a Project management fee to the extent
allowed pursuant to item (m), below, overhead and profit
increment paid to the Landlord or to subsidiaries or affiliates
of the Landlord for services in the Project to the extent the
same exceeds the costs of such services rendered by qualified,
first-class unaffiliated third parties on a competitive basis;
(i) any compensation paid to clerks, attendants or other
persons in commercial concessions operated by the Landlord,
provided that any compensation paid to any concierge at the
Project shall includable as an Operating Expense;
(j) rentals and other related expenses incurred in leasing
air conditioning systems, elevators or other equipment which if
purchased the cost of which would be excluded from Operating
Expenses as a capital cost, except equipment not affixed to the
Project which is used in providing janitorial or similar services
and, further excepting from this exclusion such equipment rented
or leased to remedy or ameliorate an emergency condition in the
Project;
(k) all items and services for which Tenant or any other
tenant in the Project reimburses Landlord or which Landlord
provides selectively to one or more tenants (other than Tenant)
without reimbursement;
(l) costs, other than those incurred in ordinary
maintenance and repair, for sculpture, paintings, fountains or
other objects of art;
(m) fees payable by Landlord for management of the Project
in excess of three and one-half percent (3.5%) (the "Management
Fee Cap") of Landlord's gross rental revenues, adjusted and
grossed up to reflect a one hundred percent (100%) occupancy of
the Building with all tenants paying rent, including base rent,
pass-throughs, and parking fees (but excluding the cost of after
hours services or utilities) from the Project for any calendar
year or portion thereof;
(n) any costs expressly excluded from Operating Expenses
elsewhere in this Lease;
(o) rent for any office space occupied by Project
management personnel to the extent the size or rental rate of
such office space exceeds the size or fair market rental value of
office space occupied by management personnel of the Comparable
Buildings in the vicinity of the Building, with adjustment where
appropriate for the size of the applicable project;
(p) costs arising from the gross negligence or wilful
misconduct of Landlord or its agents, employees, vendors,
contractors, or providers of materials or services;
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(q) costs incurred to comply with laws relating to the removal
of hazardous material (as defined under applicable law) which was in
existence in the Building or on the Project prior to the Lease
Commencement Date, and was of such a nature that a federal, State or
municipal governmental authority, if it had then had knowledge of the
presence of such hazardous material, in the state, and under the
conditions that it then existed in the Building or on the Project,
would have then required the removal of such hazardous material or
other remedial or containment action with respect thereto; and costs
incurred to remove, remedy, contain, or treat hazardous material,
which hazardous material is brought into the Building or onto the
Project after the date hereof by Landlord or any other tenant of the
Project and is of such a nature, at that time, that a federal, State
or municipal governmental authority, if it had then had knowledge of
the presence of such hazardous material, in the state, and under the
conditions, that it then exists in the Building or on the Project,
would have then required the removal of such hazardous material or
other remedial or containment action with respect thereto;
(r) costs arising from Landlord's charitable or political
contributions;
(s) any gifts provided to any entity whatsoever, including, but
not limited to, Tenant, other tenants, employees, vendors,
contractors, prospective tenants and agents; and
(t) the cost of any magazine, newspaper, trade or other
subscriptions.
If Landlord is not furnishing any particular work or service (the
cost of which, if performed by Landlord, would be included in
Operating Expenses) to a tenant who has undertaken to perform such
work or service in lieu of the performance thereof by Landlord,
Operating Expenses shall be deemed to be increased by an amount equal
to the additional Operating Expenses which would reasonably have been
incurred during such period by Landlord if it had at its own expense
furnished such work or service to such tenant. If the Project is not
at least ninety-five percent (95%) occupied during all or a portion of
the Base Year or any Expense Year, Landlord shall make an appropriate
adjustment to the components of Operating Expenses for such year to
determine the amount of Operating Expenses that would have been
incurred had the Project been ninety-five percent (95%) occupied; and
the amount so determined shall be deemed to have been the amount of
Operating Expenses for such year. Operating Expenses for the Base Year
shall not include market-wide labor-rate increases due to
extraordinary circumstances, including, but not limited to, boycotts
and strikes, and utility rate increases due to extraordinary
circumstances including, but not limited to, conservation surcharges,
boycotts, embargoes or other shortages, or amortized costs relating to
capital improvements."
4.2.2 BASE YEAR. Notwithstanding anything contained in the Lease to
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the contrary, effective as of the New Premises Commencement Date, with respect
to the calculation of Tenant's Share of annual Building Direct Expenses under
Article 4 of the Lease allocable to the period beginning on the New Premises
Commencement Date and thereafter with respect to the New Premises, the "Base
Year" shall be calender year 1996, and Section 5 of the Summary is hereby
revised accordingly.
4.2.3 TAXES.
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4.2.3.1 On the eighth (8th) line of Section 4.2.8.1 of the
Lease, on page 8 thereof, after the words "which shall be paid" are hereby
added to the words "or accrued".
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4.2.3.2 After the last sentence of Section 4.2.8.4 of the
Lease, on page 9 thereof, is hereby added:
"Notwithstanding the foregoing, in the event that the Project is
reassessed (the "Reassessment") for real estate tax purposes by
the appropriate governmental authority pursuant to the terms of
Proposition 13, the component of Tax Expenses for the Base Year
which is attributable to the assessed value of the Project under
Proposition 13 prior to the Reassessment (without taking into
account any Proposition 8 reductions) shall be reduced, if at
all, for the purposes of comparison to all subsequent Expense
Years (commencing with the Expense Year in which the
Reassessment takes place) to an amount equal to the real estate
taxes based upon such Reassessment."
4.2.4 TENANT'S SHARE. With respect to the New Premises,
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Tenant's Share as set forth in Section 6 of the Summary shall be 0.5274%.
5. SECURITY DEPOSIT. Landlord and Tenant acknowledge that, in accordance
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with Article 21 of the Lease, Tenant has previously delivered the sum of Three
Thousand Three Hundred Nintey-One and 20/100 Dollars ($3,391.20) (the "Existing
Security Deposit") to Landlord as security for the faithful performance by
Tenant of the terms, covenants and conditions of the Lease with respect to the
Existing Premises. Landlord shall retain the Existing Security Deposit with
respect to Tenant's lease of the New Premises to the extent not used, applied or
retained by Landlord with respect to the Existing Premises. Concurrently with
Tenant's execution of this First Amendment, Tenant shall deposit with landlord
an amount equal to Eight Thousand Seven Hundred Sixty-Nine and 40/100 Dollars
($8,769.40) to be held by Landlord as a part of the Security Deposit.
Notwithstanding anything in the Lease to the contrary, the Security Deposit held
by Landlord pursuant to the Lease, as amended hereby, shall equal Twelve
Thousand One Hundred-Sixty and 60/100 Dollars ($12,160.60), and to the extent
that the total amount held by Landlord at any time as security for the Lease, as
amended hereby, is less than such amount, Tenant shall pay the difference to
Landlord within ten(10) days following Tenant's recept of notice thereof from
Landlord.
6. CONDITION OF PREMISES. Notwithstanding anything in the Lease to the
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contrary, except as specifically set forth in this First Amendment and the
Tenant Work Letter attached hereto as Exhibit B-1, Tenant shall accept the New
Premises in its presently existing, "as is" condition.
7. INSURANCE As of the New Premises Commencement Date, Item (ii) of
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Section 10.3.2 of the Lease, on page 17 thereof, is hereby deleted and replaced
with the following:
"(ii) the "Tenant Improvements," as that term is defined in Section 1
of the Tenant Work Letter (the "Tenant Work Letter") attached to that
certain First Amendment to Office Lease, dated November 26, 1996, as
Exhibit B-1, and any other improvements which exist in the Premises as
of the New Premises Commencement Date (excluding the Base Building)
(the "Original Improvements"), and...".
8. DAMAGE AND DESTRUCTION. As of the New Premises Commencement Date,
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the fourth sentence of Section 11.1 of the Lease, on Page 18 thereof, is hereby
deleted and replaced with the following:
"Upon the occurrence of any damage to the Premises, Tenant shall
assign to Landlord (or to any party designated by Landlord) all
insurance proceeds payable to Tenant under Tenant's insurance required
under Section 10.3 of this Lease, and Landlord shall repair any injury
or damage to the Tenant Improvements and the Original Improvements
installed in the Premises and shall return such Tenant Improvements
and Original Improvements to their original condition; provided that
if the cost of such repair by Landlord exceeds the amount of insurance
proceeds received by Landlord from Tenant's insurance carrier, as
assigned by Tenant, the
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cost of such repairs shall be paid by Tenant to Landlord prior to
Landlord's commencement of repair of the damage."
9. BROKER. Landlord and Tenant hereby represent and warrant to each
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other that they have not dealt with any broker or agent in connection with the
negotiation and consummation of this First Amendment other than Premisys Real
Estate Services, Inc. (the "Broker") and they each know of no other real estate
broker, agent of finder who is, or might be, entitled to a commission or
compensation in connection with this First Amendment. Each party agrees to
indemnify and defend the other party against, and hold the other party harmless
from, any and all claims, demands, losses, liabilities, lawsuits, judgments, and
costs and expenses (including, without limitation, reasonable attorneys' fees)
with respect to any leasing commission or equivalent compensation alleged to be
owing on account of the indemnifying party's dealings with any real estate
broker or agent other than the Broker.
10. NOTICES. Effective as of the New Premises Commencement Date, the
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address set forth for Tenant in Section 10 of the Summary as being Tenant's
address for notice after the Lease Commencement Date is hereby deleted and is
replaced with the following: "2049 Century Park East, Suite 350, Los Angeles,
California 90067, Attention: Mr. Wayne L. Knyal, President."
11. NO FURTHER MODIFICATION. Except as specifically set forth in this
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First Amendment, all of the terms and provisions of the Lease shall remain
unmodified and in full force and effect.
IN WITNESS WHEREOF, this First Amendment has been executed as of the day
and year first above written.
"LANDLORD" "TENANT"
DELTA TOWERS JOINT VENTURE, FRANCHISE MORTGAGE ACCEPTANCE
a California general partnership COMPANY, L.L.C.,
a California limited liability
company
By: Premisys Real Estate Services, Inc.,
Agent
By: /s/ Wayne L. Knyal
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By: [SIGNATURE ILLEGIBLE]
------------------------ Its:_______________________
Its: VP/GM
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By:___________________________
Its:_______________________
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ACKNOWLEDGEMENT AND CONSENT OF GUARANTOR
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The undersigned Guarantor under that certain Guaranty of Lease dated August
24, 1995 ("Guaranty"), hereby (i) acknowledges and consents to the First
Amendment provided above, and (ii) agrees that the terms and conditions of the
Guaranty, including Guarantor's promises, covenants and guarantees thereunder,
shall apply to this First Amendment.
Dated November 26, 1996
IMPERIAL CREDIT INDUSTRIES, INC.,
a California corporation
By: [SIGNATURE ILLEGIBLE]
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Its: General Counsel
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By:________________________
Its:____________________
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EXHIBIT A-1
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OUTLINE OF NEW PREMISES
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[FLOOR PLAN APPEARS HERE]
Premisys
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Real Estate Services
[LOGO OF CENTURY PLAZA TOWERS APPEARS HERE]
CONTROL PLAN
2049 CENTURY PARK EAST
LOS ANGELES, CALIFORNIA
FLOOR 3RD
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DATE 10/18/94
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CENTURY PARK EAST
2029 2049
P. PATRICK MURRAY INC.
INTERIOR SPACE PLANNING
TEL. (310) 553-3752 FAX. (310) 553-9149
EXHIBIT A-1 - Page 1
EXHIBIT B-1
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CENTURY PLAZA TOWERS
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TENANT WORK LETTER
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This Tenant Work Letter shall set forth the terms and conditions relating
to the construction of the tenant improvements in the New Premises. This Tenant
Work Letter is essentially organized chronologically and addresses the issues of
the construction of the New Premises, in sequence, as such issues will arise
during the actual construction of the New Premises. All references in this
Tenant Work Letter to Articles or Sections of "this First Amendment" shall mean
the relevant portion of Sections 1 through 11 of the First Amendment to Office
Lease to which this Tenant Work Letter is attached as Exhibit B-1 and of which
this Tenant Work Letter forms a part, and all references in this Tenant Work
Letter to Sections of "this Tenant Work Letter" shall mean the relevant portion
of Sections 1 through 6 of this Tenant Work Letter.
SECTION 1
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CONSTRUCTION DRAWINGS FOR THE NEW PREMISES
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Landlord shall construct the improvements in the New Premises (the "Tenant
Improvements") pursuant to those certain construction drawings entitled "Scheme
B", dated October 20, 1996, prepared by P. Patrick Murray (collectively, the
"Approved Working Drawings"). Tenant shall make no changes or modifications to
the Approved Working Drawings without the prior written consent of Landlord,
which consent may be withheld in Landlord's sole discretion if such change or
modification would directly or indirectly delay the "Substantial Completion," as
that term is defined in Section 5.1 of this Tenant Work Letter, of the New
Premises or increase the cost of designing or constructing the Tenant
Improvements.
SECTION 2
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OVER-ALLOWANCE AMOUNT
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In the event that after Tenant's execution of this Lease, any revisions,
changes, or substitutions shall be made to the Approved Working Drawings or the
Tenant Improvements, any additional costs which arise in connection with such
revisions, changes or substitutions shall be paid by Tenant to Landlord
immediately upon Landlord's request as an over-allowance amount (the "Over-
Allowance Amount"). The Over-Allowance Amount shall be disbursed by Landlord
prior to the disbursement of any portion of Landlord's contribution to the
construction of the Tenant Improvement.
SECTION 3
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CONTRACTOR'S WARRANTIES AND GUARANTIES
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Landlord hereby assigns to Tenant all Warranties and guaranties by the
contractor who constructs the Tenant Improvements (the "Contractor") relating
to the Tenant Improvements, and Tenant hereby waives all claims against Landlord
relating to, or arising out of the construction of, the Tenant Improvements.
SECTION 4
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TENANTS COVENANTS
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Tenant hereby protects, defends, indemnifies and holds Landlord harmless
for any loss, claims, damages or delays arising from the actions of Tenant's
space planner/architect on the New Premises or in the Building. In addition,
immediately after the Substantial Completion of the New Premises, Tenant shall
have prepared and delivered to the Building a copy of the record set of plans
and specifications (including all working drawings for the Tenant Improvements.
EXHIBIT B-1 - Page 1
SECTION 5
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COMPLETION OF THE TENANT IMPROVEMENTS:
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NEW PREMISES COMMENCEMENT DATE
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5.1 Ready for Occupancy. The New Premises shall be deemed "Ready for
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Occupancy" upon the Substantial Completion of the New Premises. For purposes of
this First Amendment, "Substantial Completion" of the New Premises shall occur
upon the completion of construction of the Tenant Improvements in the New
Premises pursuant to the Approved Working Drawings, with the exception of any
punch list items and any tenant fixtures, work-stations, built-in furniture, or
equipment to be installed by Tenant or under the supervision of Contractor.
5.2 Delay of the Substantial Completion of the New Premises. Except as
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provided in this Section 5.2, the New Premises Commencement Date shall occur as
set forth in Section 3.1 of the First Amendment and Section 5.1, above. If there
shall be a delay or there are delays in the Substantial Completion of the New
Premises or in the occurrence of any of the other conditions precedent to the
New Premises Commencement Date, as set forth in Section 3.1 of the First
Amendment, as direct, indirect, partial, or total result of:
5.2.1 Tenant's failure to timely approve any matter requiring
Tenant's approval;
5.2.2 A breach by Tenant of the terms of this Tenant Work Letter, the
Lease or this First Amendment;
5.2.3 Tenant's request for changes in the Approved Working Drawings;
5.2.4 Changes in any of the Approved Working Drawings because the
same do not comply with applicable laws;
5.2.5 Tenant's requirement for materials, components, finishes or
improvements which are not available in a commercially reasonable time given the
anticipated date of Substantial Completion of the New Premises, as set forth in
this First Amendment, or which are different from, or not included in,
Landlord's standard improvement package items for the Building;
5.2.6 Changes to the base, shell and core work of the Building
required by the Approved Working Drawings; or
5.2.7 Any other acts or omissions of Tenant, or its agents, or
employees;
then, notwithstanding anything to the contrary set forth in this First Amendment
or this Tenant Work Letter and regardless of the actual date of the Substantial
Completion of the New Premises, the date of the Substantial Completion of the
New Premises shall be deemed to be the date the Substantial Completion of the
New Premises would have occurred if no Tenant delay or delays, as set forth
above, had occurred.
SECTION 6
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MISCELLANEOUS
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6.1 Tenant's Entry Into the New Premises Prior to Substantial Completion.
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Provided that Tenant and its agents do not interfere with Contractor's work in
the Building and the New Premises, Contractor shall allow Tenant access to the
New Premises prior to the Substantial Completion of the New Premises for the
purpose of Tenant installing overstandard equipment or fixtures (including
Tenant's data and telephone equipment) in the New Premises. Prior to Tenant's
entry into the New Premises as permitted by the terms of this Section 6.1,
Tenant shall submit a schedule to Landlord and Contractor, for their approval,
which schedule shall detail the timing and purpose of Tenant's entry. Tenant
shall hold Landlord harmless from and indemnify, protect and defend Landlord
against any loss or damage to the Building or New Premises and against injury to
any persons caused by Tenant's actions pursuant to this Section 6.1.
6.2 Tenant's Representative. Tenant has designated Mr. Wayne L. Knyal as
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its sole representative with respect to the matters set forth in this Tenant
Work Letter, who, until further
EXHIBIT B-1 - Page 2
notice to Landlord, shall have full authority and responsibility to act on
behalf of the Tenant as required in this Tenant Work Letter.
6.3 Landlord's Representative. Landlord has designated Ms. Mary Ledford
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as its sole representative with respect to the matters set forth in this Tenant
Work Letter, who, until further notice to Tenant, shall have full authority and
responsibility to act on behalf of the Landlord as required in this Tenant Work
Letter.
6.4 Tenant's Agents. All subcontractors, laborers, materialmen, and
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suppliers retained directly by Tenant shall all be union labor in compliance
with the master labor agreements existing between trade unions and the Southern
California Chapter of the Associated General Contractors of America.
6.5 Time of the Essence in This Tenant Work Letter. Unless otherwise
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indicated, all references herein to a "number of days" shall mean and refer to
calendar days. In all instances where Tenant is required to approve or deliver
an item, if no written notice of approval is given or the item is not delivered
within the stated time period, at Landlord's sole option, at the end of such
period the item shall automatically be deemed approved or delivered by Tenant
and the next succeeding time period shall commence.
6.6 Tenant's Lease Default. Notwithstanding any provision to the contrary
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contained in the Lease, as amended, if an event of default as described in
Section 19.1 of the Lease, as amended, or a default by Tenant under this Tenant
Work Letter, has occurred at any time on or before the Substantial Completion of
the New Premises, then (i) in addition to all other rights and remedies granted
to Landlord pursuant to the Lease, as amended, Landlord shall have the right to
cause Contractor to cease the construction of the New Premises (in which case,
Tenant shall be responsible for any delay in the Substantial Completion of the
New Premises caused by such work stoppage as set forth in Section 5 of this
Tenant Work Letter), and (ii) all other obligations of Landlord under the terms
of this Tenant Work Letter shall be forgiven until such time as such default is
cured pursuant to the terms of the Lease, as amended.
EXHIBIT B - 1 - Page 3