STANDARD FORM
SINGLE TENANT INDUSTRIAL LEASE
(NET)
LANDLORD: South Bay Industrials Company, L.L.C.,
a Delaware limited liability company
TENANT: Systemax, Inc., a New York corporation,
dba: Global Computer Supplies
PROJECT: 921 West Artesia Boulevard
CITY, STATE Compton, California
DATE: July 17, 1997
STANDARD FORM
SINGLE TENANT INDUSTRIAL LEASE
(NET)
TABLE OF CONTENTS
PAGE
1. Basic Lease Term.......................................................1
2. Premises...............................................................2
3. Lease Term.............................................................3
4. Possession.............................................................3
5. Rent...................................................................4
6. Prepaid Rent...........................................................5
7. Security Deposit.......................................................5
8. Use Of Premises And Project Facilities.................................6
9. Surrender Of Premises; Holding Over....................................7
10. Signage...............................................................8
11. Taxes.................................................................8
12. Utilities.............................................................9
13. Maintenance...........................................................9
14. Alterations..........................................................12
15. Release And Indemnity................................................12
16. Insurance............................................................13
17. Destruction..........................................................15
18. Condemnation.........................................................16
19. Assignment Or Sublease...............................................17
20. Default..............................................................19
21. Landlord's Remedies..................................................19
22. Default By Landlord..................................................20
23. Entry Of Premises And Performance By Tenant..........................21
24. Subordination........................................................22
25. Notice...............................................................23
26. Waiver...............................................................23
27. Limitation Of Liability..............................................23
28. Force Majeure........................................................24
29. Professional Fees....................................................24
30. Examination Of Lease.................................................25
31. Estoppel Certificate.................................................25
32. Rules And Regulations................................................26
33. Liens................................................................26
34. Miscellaneous Provisions.............................................26
RIDERS
1. Early Entry..........................................................R-1
2. Option to Extend.....................................................R-2
EXHIBITS [OMITTED]
A. Depiction of Premises................................................A-1
B. Project Site Plan....................................................B-1
C. Work Letter Agreement................................................C-1
D. Notice of Lease Term Dates...........................................D-1
E. Tenant Estoppel Certificate..........................................E-1
F. Rules and Regulations................................................F-1
G. Project Signage Criteria.............................................G-1
H. Hazardous Materials Addendum.........................................H-1
I. Hazardous Materials Questionnaire....................................I-1
STANDARD INDUSTRIAL LEASE
(NET)
1. BASIC LEASE TERM.
a. DATE OF LEASE EXECUTION: July 17, 1997
b. TENANT: Systemax, Inc., a New York corporation
Trade Name Global Computer Supplies
Address (Leased Premises): 921 West Artesia Boulevard
City, State Zip Code: Compton, CA 90220
Building/Suite/Unit: 921 West Artesia Boulevard
c. LANDLORD: South Bay Industrials Co., L.L.C., a Delaware limited
liability company Address (FOR RENT AND NOTICES): c/o SARESoREGIS
Group 9500 Telstar Avenue, Suite 106, El Monte, CA 91731, with a copy
to: J.P. Morgan Investment Management, 522 Fifth Avenue, New York, NY
10036 and to: SARESoREGIS Group, 18802 Bardeen Avenue, Irvine, CA
92712
d. TENANT'S PERMITTED USE OF PREMISES: Warehousing and distribution of
computer related products, materials handling equipment, retail sales
and related office activities.
e. PREMISES: Those Certain Premises Defined in PARAGRAPH 2 Below.
f. PREMISES AREA: approximately 140,720 Rentable Square Feet
g. TERM: Commencement Date: NOVEMBER 1, 1997 Expiration Date: OCTOBER 21,
2007 Number of Months 120
h. MONTHLY BASIC RENT: FORTY-SIX THOUSAND FOUR HUNDRED THIRTY-SEVEN AND
60/100 DOLLARS ($46,437.60)
i. ANNUAL BASIC RENT: FIVE HUNDRED FIFTY-SEVEN THOUSAND TWO HUNDRED
FIFTY-ONE AND 20/100 DOLLARS ($557,251.20)
j. RENT ADJUSTMENT:
Cost of Living. The cost of living provisions of Subparagraph 5(c)
apply using the Consumer Price Index - Urban Wage Earners and Clerical
Workers (Los Angeles- Anaheim-Riverside), all items, Base 1982-1984
("Index"), (1967=100), with a minimum increase of 3% per annum and a
maximum increase of 7%, said adjustments calculated and effective at
the commencement of the 31st, 61st and 91st months of the Term.
k. PREPAID RENT (for FIRST month of term): FORTY-SIX THOUSAND FOUR
HUNDRED THIRTY-SEVEN AND 60/100 DOLLARS ($46,437.60).
l. TOTAL SECURITY DEPOSIT: $60,590.50, including a $0.00 non-refundable
cleaning fee.
m. BROKER(S): CB Commercial - Jeffery S. Morgan and John J. Schumacher,
representing Tenant.
n. GUARANTOR(S): N/A
o. TENANT IMPROVEMENTS: All work performed by Landlord to prepare the
Premises for occupancy pursuant to the terms of the work Letter
Agreement attached hereto as EXHIBIT C.
p. TENANT IMPROVEMENT ALLOWANCE: If applicable, Landlord grants to Tenant
a Tenant Improvement Allowance pursuant to the terms of the Work
Letter Agreement attached hereto as EXHIBIT C.
q. PARKING: Tenant shall have exclusive rights to all available designed
parking appurtenant to the property.
r. ADDITIONAL SECTIONS: Additional sections of this Lease, contained in
the "Addendum to the Lease", numbered 36 through 0 - - are attached
hereto and made a part hereof. If none, so state in the following
space NONE.
v. RIDERS: Riders numbered 1 through 2 are attached hereto and made a
part hereof. If none, so state in the following space - - .
w. EXHIBITS: Exhibits lettered A through I are attached hereto and made a
part hereof. If none, so state in the following space - - .
This PARAGRAPH 1 represents a summary of the basic terms of this
lease. In the event of any inconsistency between the terms contained
in this PARAGRAPH 1 and any specific provision of this Lease, the
terms of the more specific provision shall prevail.
2. PREMISES.
(a) Landlord hereby leases to Tenant, and Tenant hereby leases from
Landlord, the premises referenced in PARAGRAPH 1 and outlined in
EXHIBIT A (the "Premises"), consisting of that certain building (the
"Building") AND THE EXCLUSIVE PARKING AND DELIVERY AREAS APPURTENANT
THERETO which is a part of the project described on EXHIBIT B (the
"Project"). By entry on the Premises, Tenant acknowledges that it has
examined the Premises and accepts the Premises in their present
condition, subject to any additional work Landlord has agreed to
perform pursuant to the provisions of this Lease.
(b) The parties agree that the letting and hiring of the Premises is upon
and subject to the terms, covenants and conditions herein set forth
and Tenant covenants as a material part of the consideration for this
Lease to keep and perform each and all of said terms, covenants and
conditions by it to be kept and performed and that this Lease is made
upon the condition of such performance.
3. LEASE TERM.
The term of this Lease shall be for the period designated in Subparagraph
1(g) commencing on the commencement Date, and ending on the Expiration Date
as set forth in said Subparagraph 1(g), unless the term hereby demised
shall be sooner terminated as herein provided ("Term"). Notwithstanding the
foregoing, if the Commencement Date falls on any day other than the first
day of a calendar month then the Term of this Lease shall be measured from
the first day of the month following the month in which the commencement
Date occurs.
4. POSSESSION.
(a) DELIVERY OF POSSESSION. Landlord agrees to deliver possession of the
Premises to Tenant upon the substantial completion of the Tenant
Improvements as determined by Landlord's architect or space planner in
accordance with the terms of this Lease and the Work Letter Agreement
attached hereto as exhibit C. Notwithstanding the foregoing, Landlord
shall not be obligated to deliver possession of the Premises to Tenant
until Landlord has received from Tenant all of the following: (i) the
Security Deposit and first monthly installment of Annual Basis Rent;
(ii) executed copies of policies of insurance of certificates thereof
as required under Paragraph 18 of this Lease; (iii) copies of all
governmental permits and authorizations required in connection with
Tenant's operation of its business upon the Premises; and (iv) an
executed original of the Hazardous Materials Questionnaire in the form
attached hereto as Exhibit 1.
(b) CONDITION OF PREMISES. Prior to the Commencement Date and in
accordance with the Work Schedule to be prepared by Landlord and
Tenant pursuant to the Work Letter Agreement attached hereto as
Exhibit C, Landlord and Tenant shall jointly conduct a walk-through
inspection of the Premises and shall jointly prepare a list (the
"Punch-List") of items needing additional work; provided, however, the
Punch- List shall be limited to items required to be installed by
landlord under the Work Letter Agreement and the Punch-List will not
include any items of damage to the Premises caused by Tenant's move-in
or early entry, if permitted. Damage caused by Tenant will be
corrected or repaired by Landlord, at Tenant's expense. Other than the
items specified in the Punch-List, by taking possession of the
Premises, Tenant will be deemed to have accepted the Premises and the
Building in their condition on the date of delivery of possession and
to have acknowledged that Landlord has installed the Tenant
Improvements as required by the work Letter Agreement and that there
are no additional items needing work or repair. Landlord shall cause
all items set forth in the Punch-List to be repaired or corrected
within thirty (30) days following the preparation of the Punch-List or
as soon as reasonably practicable after the preparation of the
Punch-List. Tenant acknowledges that neither Landlord nor any agent of
Landlord has made any representation or warranty with respect to the
Premises, the Building, the Project or any portions thereof or with
respect to the suitability of same for the conduct of Tenant's
business. Without limiting the foregoing, if the Building is newly
constructed or renovated, Tenant's execution of the Notice attached
hereto as Exhibit D shall constitute a specific acknowledgment and
acceptance of the various start-up inconveniences that may be
associated with the use of the Project and the Common Areas such as
certain construction obstacles including scaffolding, uneven air
conditioning services and other typical conditions incident to
recently constructed or renovated buildings.
5. RENT.
(a) BASIC RENT. Tenant agrees to pay Landlord as Annual Basic Rent for the
Premises the annual basic Rent designated in SUBPARAGRAPH 1(I)
(adjusted as hereinafter provided) in twelve (12) equal monthly
installments as designated in Subparagraph 1(h), each in advance on
the first day of each and every calendar month during the Term, except
that one month's rent shall be paid upon the execution of this Lease.
If the Term of this Lease commences on a day other than the first day
of a calendar month or ends on a day other than the last day of a
calendar month, then the rent for such periods shall be prorated in
the proportion that the number of days this Lease is in effect during
such periods bears to thirty days (30), and such rent shall b paid at
the commencement of such period. In addition to the Annual Basic Rent,
Tenant agrees to pay additional rent as provided in PARAGRAPH 6 and
the amount of all rental adjustments as and when hereinafter provided
in this Lease. The Annual Basic Rent, any additional rent payable
pursuant to the provisions of this lease and any rental adjustments
shall be paid to Landlord, without any prior demand therefor, and
without any deduction or offset whatsoever in lawful money of the
United States of America, which shall be legal tender at the time of
payment, at the address of Landlord designated in SUBPARAGRAPH 1(C) or
to such other person or at such other place as Landlord may from time
to time designate in writing. Further, all charges to be paid by
Tenant hereunder, including, without limitation, payments for real
property taxes, insurance, repairs, and parking, if any, shall be
considered additional rent for the purposes of this Lease, and the
word "rent" in this Lease shall include such additional rent unless
the context specifically or clearly implies that only the Annual Basic
Rent is referenced. Annual Basic Rent shall be adjusted as provided in
SUBPARAGRAPH 1(I).
(b) LATE PAYMENTS. Tenant acknowledges that late payment by Tenant to
Landlord of any rent or other sums due under this Lease will cause
Landlord to incur costs not contemplated by this Lease, the exact
amount of such costs being extremely difficult and impracticable to
ascertain. Such costs include, without limitation, processing and
accounting charges and late charges and late charges that may be
imposed on Landlord by the terms of any encumbrance or note secured by
the Premises. Therefore, if any rent or other sum due from Tenant is
not received WITHIN FIVE (5) BUSINESS DAYS OF THE DATE when due,
Tenant shall pay to landlord immediately thereafter an additional sum
equal to FIVE PERCENT (5%) of such overdue payment. Landlord and
Tenant hereby agree that such late charge represents a fair and
reasonable estimate of the costs that Landlord will incur by reason of
any such late payment. Additionally, all such delinquent rent or other
sums, plus this late charge, shall bear interest at the then maximum
lawful rate permitted to be charged by Landlord. Any payments of any
kind returned for insufficient funds will be subject to an additional
handling charge of $25.00.
(c) COST OF LIVING RENT ADJUSTMENT. Annual Basic Rent, including all prior
adjustments, shall be increased (but never decreased) effective each
thirty (30) month anniversary of the Commencement Date of this Lease
or each anniversary of the first day of the month immediately
following the month in which the Commencement Date occurs if the
Commencement date occurs other than on the first day of a month
("Adjustment Date"), in accordance with the percentage increase, if
any, in the Index described in SUBPARAGRAPH 1(L)1 as published by the
United States Department of Labor, Bureau of Labor Statistics
("Bureau"). The Index most recently published prior to the Adjustment
date shall be compared with the Index for the same month of the
preceding period and the Annual Basic Rent shall be increased in
accordance with the percentage increase, if any, between such Indices.
Should the Bureau discontinue the publication of the Index, or publish
the same less frequently, or alter the same in some other manner,
Landlord, in its discretion, shall adopt a substitute index or
procedure with reasonably reflects and monitors consumer prices.
6. PREPAID RENT.
Upon execution of this Lease, Tenant shall pay to Landlord the Prepaid Rent
set forth in SUBPARAGRAPH 1(K), and if Tenant is not in default of any
provisions of this Lease, such Prepaid Rent shall be applied toward the
rent due for the FIRST month of the Term. Landlord's obligation with
respect to the Prepaid Rent are those of a debtor and not of a trustee, and
Landlord can commingle the Prepaid Rent with Landlord's general funds.
Landlord shall not be required to pay Tenant interest on the Prepaid Rent.
Landlord shall be entitled to immediately endorse and cash Tenant's Prepaid
Rent; however, such endorsement and cashing shall not constitute Landlord's
acceptance of this Lease. In the event Landlord does not accept this Lease,
Landlord shall return said Prepaid Rent. If Landlord sells the Premises and
deposits with the purchaser the Prepaid Rent, landlord shall be discharged
from any further liability with respect to the Prepaid Rent.
7. SECURITY DEPOSIT.
Upon execution of this Lease, Tenant shall deposit the Security Deposit set
forth in SUBPARAGRAPH 1(L) with Landlord, as security for the performance
by Tenant of the provisions of this Lease. If Tenant is in default,
regardless if such default is monetary or non-monetary. Landlord can use
the Security Deposit or any portion of it to cure the default or to
compensate Landlord for any damages sustained by Landlord resulting from
Tenant's default. Upon demand, Tenant shall immediately pay to Landlord a
sum equal to the portion of the Security Deposit expended or applied by
Landlord to maintain the Security Deposit in the amount initially deposited
with Landlord. If Tenant is not in default at the expiration or termination
of this Lease, Landlord shall return the entire Security Deposit to Tenant.
Landlord's obligations with respect to the Security Deposit are those of a
debtor and not a trustee, and Landlord can commingle the Security Deposit
with landlord's general funds. Landlord shall not be required to pay Tenant
interest on the Security Deposit. Landlord shall be entitled to immediately
endorse and cash Tenant's Security Deposit; however, such endorsement and
cashing shall not constitute landlord's acceptance of this Lease. In the
event Landlord does not accept this Lease, Landlord shall return said
Security Deposit. If Landlord sells the Premises and deposits with the
purchaser the then amount of the Security Deposit, Landlord shall be
discharged from any further liability with respect to the Security Deposit.
8. USE OF PREMISES AND PROJECT FACILITIES.
(a) TENANT'S USE OF THE PREMISES. Tenant shall use the Premises for the
use or uses set forth in SUBPARAGRAPH 1(D) above, and shall not use or
permit the Premises to be used for any other purpose without the prior
written consent of Landlord, which consent Landlord may withhold in
its sole and absolute discretion. Nothing contained herein shall be
deemed to give Tenant any exclusive right to such use in the Project.
(b) COMPLIANCE. At Tenant's sole cost and expense, Tenant shall procure,
maintain and hold available for Landlord's inspection, all
governmental licenses and permits required for the proper and lawful
conduct of Tenant's business from and at the Premises. Tenant shall
maintain the Premises in compliance with any and all CC&Rs and all
laws, statutes, zoning restrictions, ordinances or governmental laws,
rules, regulations or requirements of any duly constituted public
authority having jurisdiction over the Premises now or hereafter in
force, the requirements of the Board of Fire Underwriters or any other
similar body now or hereafter constituted, or of the Certificate of
Occupancy issued for the Building. Tenant shall not use or occupy the
Premises in violation of any of the foregoing. Tenant shall, upon
written notice from landlord, discontinue any use of the Premises
which is declared by any authority having jurisdiction over the
Premises, governmental or otherwise, to be a violation of law or of
said Certificate of Occupancy. NOTWITHSTANDING THE FOREGOING, TENANT
SHALL HAVE THE RIGHT TO CONTEST SUCH DECLARATION SO LONG AS SAME SHALL
STAY THE ENFORCEMENT OF ANY PROCEEDING AND NOT RESULT IN ANY PECUNIARY
LOSS TO LANDLORD. Tenant shall comply with all rules, orders,
regulations and requirements of any insurance authority having
jurisdiction over the Project or any present or future insurer
relating to the Premises or the Project. Tenant shall promptly, upon
demand, reimburse Landlord for any additional premium charged for any
existing insurance policy or endorsement required by reason of
Tenant's failure to comply with the provisions of this PARAGRAPH 8.
Tenant shall not do or permit anything to be done in or about the
Premises which will in any manner obstruct or interfere with the
rights of other tenants or occupants of the Project, or injure or
annoy them, or use or allow the Premises to be used for any improper,
immoral, unlawful or objectionable purpose, nor shall Tenant cause,
maintain or permit any nuisance in, on or about the Premises. Tenant
shall comply with all restrictive covenants and obligations crated by
private contracts which affect the use and operation of the Premises,
or the Project including, without limitation, the CURRENT Rules and
Regulations referred to in PARAGRAPH 32 and attached hereto as EXHIBIT
F, as THEY RELATE TO THE PERMITTED USES DEFINED IN SECTION 1(D) OF
THIS LEASE. Tenant shall not commit or suffer to be committed any
waste in or upon the Premises and shall keep the Premises in first
class repair and appearance. Further, Tenant's business machines and
mechanical equipment which cause vibration or noise that may be
transmitted to the Building structure or to any other space in the
Building shall be so installed, maintained and used by Tenant as to
eliminate or minimize such vibration or noise. Tenant shall be
responsible for all structural engineering required to determine
structural load, as well as the expense thereof.
9. SURRENDER OF PREMISES; HOLDING OVER.
Upon expiration of the Term of this Lease, Tenant shall surrender to
Landlord the Premises and all Tenant Improvements and alterations in good
condition, except for ordinary wear and tear and alterations Tenant has the
right or is obligated to remove under the provisions of PARAGRAPH 14
herein. Tenant shall remove all personal property and shall perform all
restoration made necessary by the removal of any alterations of Tenant's
personal property before the expiration of the Term, including for example,
restoring all wall surfaces to their condition prior to the commencement of
this Lease. Landlord can elect to retain or dispose of in any manner
Tenant's personal property not removed from the Premises by Tenant prior to
the expiration of the Term. Tenant waives all claims against Landlord for
any damage to the Tenant resulting from Landlord's retention or disposition
of Tenant's personal property. Tenant shall be liable to Landlord for
Landlord's costs for storage, removal or disposal of Tenant's personal
property.
If Tenant, with Landlord's consent, remains in possession of the Premises
after expiration or termination of the Term, or after the date in any
notice given by Landlord to Tenant terminating this Lease, such possession
by Tenant shall b deemed to be a month-to-month tenancy terminable on
written 30-day notice at any time, by either party. All provisions of this
Lease, except those pertaining to term and rent, shall apply to the
month-to-month tenancy. Tenant shall pay monthly rent in an amount equal to
125% of Monthly Basic Rent, subject to increases as provided in
SUBPARAGRAPH 5(C), if applicable, for the last full calendar month during
the regular Term plus 100% of said last month's estimate to Tenant's share
of Expenses pursuant to PARAGRAPH 13, subject to increase as provided
therein. If Tenant fails to surrender the Premises after expiration or
termination of the Term, Tenant shall indemnify, defend and hold Landlord
harmless from all loss or liability, including, without limitation, any
loss or liability resulting from any claim against Landlord made by any
succeeding tenant founded on or resulting from Tenant's failure to
surrender the Premises together with actual attorney's fees and costs.
10. SIGNAGE.
Landlord shall designate the location on the Building and/or the Premises,
if any, for one or more exterior Tenant identification sign(s) Tenant shall
install and maintain its identification sign9s) in such designated location
in accordance with this PARAGRAPH 10 and EXHIBIT G. Tenant shall have no
rights to install or maintain Tenant identification signs in any other
location in, on or about the Premises or the Project and shall not display
or erect any other signs, displays or other advertising materials that are
visible from the exterior of the Building. The size, design, color and
other physical aspects of permitted signs) shall be subject to: (i)
Landlord's written approval prior to installation, which approval may be
withheld in landlord's discretion, (ii) any covenants, conditions or
restrictions encumbering the Premises, and (iii) any applicable municipal
or governmental permits and approvals. The cost of the sign(s), including
the installation, maintenance and removal thereof shall be at Tenant's sole
cost and expense. If Tenant fails to install or maintain its sign(s), or if
Tenant fails to remove same upon termination of this Lease and repair any
damage caused by such removal including, without limitation, repainting the
Building (if required by Landlord, in Landlord's sole but reasonable
judgment), Landlord may do so at Tenant's expense. Tenant shall reimburse
Landlord for all costs incurred by Landlord to effect such installation,
maintenance or removal, which amount shall be deemed additional rent, and
shall include, without limitation, all sums disbursed, incurred or
deposited by Landlord including Landlord's costs, expenses and actual
attorney's fees with interest thereon at the maximum interest rate
permitted by law from the date of Landlord's demand until payment. Any sign
rights granted to Tenant under this Lease are personal to Tenant and may
not be assigned, transferred or otherwise conveyed to any assignee or
subtenant of Tenant without Landlord's prior written consent, which consent
Landlord may withhold in its sole and absolute discretion.
11. TAXES.
(a) PERSONAL PROPERTY TAXES. Tenant shall pay before delinquency all
taxes, assessments, license fees and public charges levied, assessed
or imposed upon its business operation as well as upon all trade
fixtures, leasehold improvements, merchandise and other personal
property in or about the Premises.
(b) REAL PROPERTY TAXES. Tenant shall pay, as additional rent, all Real
Property Taxes including all taxes, assessments (general and special)
and other impositions or charges which may be taxed, charged, levied,
assessed or imposed with respect to any calendar year or part thereof
included within the term upon all or any portion of or in relation to
the PREMISES, any leasehold estate in the Premises or measured by rent
from the Premises, including any increase caused by the transfer, sale
or encumbrance of the Project or any portion thereof. "Real Property
Taxes" shall also include any form of assessment, levy, penalty,
charge or tax (other than estate, inheritance, net income or franchise
taxes) imposed by any authority having a direct or indirect power to
tax or charge, including, without limitation, any city, county, state,
federal or any improvement or other district, whether such tax is: (i)
determined by the area of the PREMISES or the rent or other sums
payable under this Lease: (2) upon or with respect to any legal or
equitable interest of Landlord in the PREMISES or any part thereof;
(3) upon this transaction or any document to which Tenant is a party
creating a transfer in any interest in the PREMISES; (4) in lieu of or
as a direct substitute in whole or in part of or in addition to any
real property taxes on the PREMISES; (5) based on any parking spaces
or parking facilities provided in the PREMISES or (6) in consideration
for services, such as police protection, fire protection,, street,
sidewalk and roadway maintenance, refuse removal or other services
that may be provided by any governmental or quasi-governmental agency
from time to time which were formerly provided without charge or with
less charge to property owners or occupants. Tenant shall pay Real
Property Tax cost on the date any taxes or installments of taxes are
due and payable as determined by the taxing authority, evidenced by
the tax bill. Landlord shall determine and notify Tenant of Tenant's
share not less than thirty (30) days in advance of the date such taxes
or installment of taxes is due and payable. In the event Landlord
fails to deliver such timely determination and notice to Tenant, then
Tenant shall have thirty (30) days from receipt of such notice to
remit payment of Tenant's share to Landlord. The foregoing
notwithstanding, upon notice from Landlord, Tenant shall pay as
additional rent Tenant's share to landlord in advance monthly
installments equal to one twelfth (1/12) of Landlord's reasonable
estimate of Tenant's share of the Real Estate Taxes payable under this
Lease, together with monthly installments of base rent, and Landlord
shall hold such payments in a non-interest bearing account. Landlord
shall determine and notify Tenant of any deficiency in the impound
account Tenant shall pay any deficiency of funds in the impound
account not less than thirty (30) days in advance of the date such
taxes or installment of taxes is due and payable. In the event
Landlord fails to deliver such timely deficiency determination and
notice to Tenant, then Tenant shall have thirty (30) days from receipt
of such notice to remit payment of such deficiency to Landlord. If
Landlord determines that Tenant's impound account has accrued an
amount in excess of Tenant's share, then such excess shall b credited
to Tenant within said notice from Landlord.
12. UTILITIES.
Tenant shall pay directly to the utility companies providing such services,
the cost of all water, gas, heat, light, power, sewer, electricity,
telephone or other service metered, chargeable or provided to the Premises.
Landlord shall not be liable in damages or otherwise for any failure or
interruption of any utility or other service furnished to the Premises. No
such failure or interruption shall entitle Tenant to terminate this Lease
or abate rent in any manner.
13. MAINTENANCE.
(a) PERFORMANCE BY TENANT. Except as provided below, Tenant shall maintain
and repair the premises in good condition, including, without
limitation, maintaining and repairing all walls; floors; ceilings;
telephone equipment and wiring; doors exterior and interior windows
and fixtures as wells damage caused by Tenant, its agents,
contractors, employees or invites. Upon expiration or termination of
this Lease, Tenant shall surrender the Premises to Landlord in the
same condition as existed at the commencement of the Term, except for
reasonable wear and tear or damage caused by fire or other casualty
for which Landlord has received all funds necessary for restoration of
the Premises from insurance proceeds.
If Tenant refuses or neglects to repair and maintain the Premises as
required hereunder and to the reasonable satisfaction of Landlord. Landlord
may at any time following ten (10) days from the date on which Landlord
shall make a written demand on Tenant to effect such repair and
maintenance, enter upon the Premises and make such repairs and/or
maintenance without liability to tenant for any loss or damage which might
occur to Tenant's merchandise, fixtures or other property or to Tenant's
business by reason thereof, and upon completion thereof, Tenant shall pay
to Landlord, Landlord's costs for making such repairs FIFTEEN PERCENT (15%)
overhead, upon presentation of a bill therefor. Said bill shall include
interest at the maximum rate permitted by law on said costs from the date
of completion of the maintenance and repairs by Landlord.
Tenant shall, at its own expense, provide, install and maintain in good
condition all of its Personal Property required in the conduct of its
business on the Premises.
(b) PERFORMED BY LANDLORD. (i) Landlord shall be responsible at its own
cost and expense to maintain in good condition the structural part of
the Premises, which shall include only the structural beams which
support the roof deck and membrance, exterior walls, building
foundations and floors. (ii) In the event that the roof system or
existing HVAC equipment suffers major failure during the term hereof,
Landlord shall replace or repair same, and the cost thereof shall be
amortized on monthly basis over the expected useful life or the repair
or replacement, and Lessee, as an item of Addition Rent, shall pay to
Landlord on a monthly basis for the portion of such amortized cost
which shall accrue during the remaining term hereof. Subject to
reimbursement by Tenant as hereinafter provided, Landlord shall be
responsible to maintain, in good condition the roof system and
skylights; the paved and hardscaped parking and driveway areas
(including resurfacing and restriping); gutters and downspouts on the
Building; the heating, ventilating and air condition system servicing
the Premises; landscaping (including replacement thereof), sprinkler
system, walkways, parking areas AND EXTERIOR PAINTING (PERFORMED NOT
MORE THAN ONCE DURING ANY FIVE YEAR INTERVAL).
(c) REIMBURSEMENT BY TENANT. Prior to the commencement of each calendar
year, Landlord shall give Tenant a written estimate of the expenses
Landlord anticipates will be incurred for the ensuing calendar year
with respect to the maintenance and repair to be performed by Landlord
as herein described (the "Maintenance Expenses"). Tenant shall pay, as
additional rent, such estimated expenses is equal monthly installments
in advance on or before the first day of each month concurrent with
its payment of Monthly Rent. Within ninety (90) days after the end of
each calendar year, Landlord shall furnish Tenant a statement showing
in reasonable detail the actual expenses incurred for the period in
question and the parties shall within thirty (30) days thereafter make
payment or allowance as necessary to adjust Tenant's estimated
payments to the actual expenses as shown by applicable periodic
statements submitted by Landlord. If Landlord shall determine at any
time that the estimate of expenses for the current calendar year is or
will become inadequate to meet all such expenses for any reason,
Landlord shall immediately determine the appropriate amount of such
inadequacy and issue a supplemental estimate as to such expenses, and
Tenant shall pay and increase in the estimated expenses as reflected
by such supplemental estimate.
Tenant's failure to timely pay any of the charges in connection with
the performance of its maintenance and repair obligations to be paid
under this Paragraph 13 shall constitute a material default under this
Lease.
Landlord shall keep or cause to be kept separate and complete books of
account covering costs and expenses incurred in connection with its
maintenance and repair of the Building and outside areas, which costs
and expenses shall include, without limitation, the actual costs and
expenses incurred in connection with labor and material utilized in
performance of the maintenance and repair obligations hereinafter
described, public liability, property damage and other forms of
insurance which Landlord may or is required to maintain, reasonable
reserves for replacements and/or repairs of improvements to the
outside areas, equipment and supplies, employment of such personnel as
Landlord may deem reasonably necessary, payment or provision for
unemployment insurance, worker's compensation insurance and other
employee costs, depreciation of machinery and equipment used in
connection with the maintenance of the outside areas, the cost of
bookkeeping and accounting services, a management fee to cover
Landlord's management, overhead and administrative expenses,
assessments which may be levied against the Premises under any
recorded covenants, conditions and restrictions, and any other items
reasonable necessary from time to time to properly repair, replace and
maintain the outside areas and any interest paid in connection
therewith. Landlord may elect to delegate its duties hereunder to a
professional property manager in which event all costs and expenses of
such property management shall be included as expenses to be
reimbursed by Tenant hereunder.
Except as provided in PARAGRAPH 17, there shall be no abatement of
rent and no liability of Landlord by reason of any injury to or
interference with Tenant's business arising from the making of any
repair, alterations or improvements in or to any portion of the
Project or the Premises. Tenant hereby waives any and all rights to
make repairs at the expense of Landlord under the provisions of
Sections 1941 and 1942 of the California Civil Code or any similar
statue now or hereafter enacted. LANDLORD SHALL USE ALL REASONABLE
EFFORTS TO MINIMIZE ANY DISRUPTION TO THE OPERATION OF TENANT'S
BUSINESS WHILE MAKING SUCH REPAIRS, ALTERATIONS OR IMPROVEMENTS AND,
UNLESS IN AN EMERGENCY, SHALL SCHEDULE SAME OUTSIDE OF NORMAL BUSINESS
HOURS (ONLY IF STANDARD BILLING RATES APPLY FOR THE SERVICE OR TRADE
PERFORMING SUCH WORK) AND UPON TWENTY-FOUR (24) HOURS' WRITTEN NOTICE
TO TENANT.
14. ALTERATIONS.
Tenant shall not make any alterations to the Premises, or to the Project,
including any changes to the existing landscaping, without Landlord's prior
written consent WHICH CONSENT SHALL NOT BE UNREASONABLY WITHHELD.
NOTWITHSTANDING THE FOREGOING, TENANT SHALL HAVE THE RIGHT TO (I) PAINT AND
CARPET THE PREMISES, AND (II) UNDERTAKE OTHER NON-STRUCTURAL ALTERATIONS
COSTING LESS THAN $50,000, WITHOUT LANDLORD'S PRIOR WRITTEN CONSENT, BUT
WITH NOT LESS THAN THIRTY (30) DAYS PRIOR WRITTEN NOTICE TO LANDLORD. If
Landlord gives its consent to such alterations, Landlord may post notices
in accordance with the laws of the state in which the Premises are located.
Any alterations make shall remain on and be surrendered with the Premises
upon expiration of the Term, except that Landlord may, within 30 days
before or 30 days after expiration of the Term UNLESS TENANT, AT ITS SOLE
AND EXPENSE, REMOVES SAME, AND RESTORES THE PREMISES TO ITS CONDITION AS OF
THE COMMENCEMENT DATE, REASONABLE WEAR AND TEAR EXCEPTED, OR UNLESS
LANDLORD NOTIFIES TENANT AS A CONDITION OF ITS CONSENT TO REMOVE ANY
PARTICULAR IMPROVEMENT, OR PORTION THEREOF, AND RESTORE THE PREMISES TO THE
CONDITION IMMEDIATELY PRIOR TO THE INSTALLATION OF THE PARTICULAR
IMPROVEMENT.
Should Landlord consent in writing to Tenant's alteration of the Premise,
Tenant shall contract with a contractor approved by Landlord for the
construction of such alterations, shall secure all appropriate governmental
approvals and permits, and shall complete such alterations with due
diligence in compliance with plans and specifications approved by Landlord,
and in compliance with all applicable laws, statutes and regulations. All
such construction shall be performed in a manner which will not interfere
with the quiet enjoyment of other tenants of the Project. Tenant shall pay
all costs for such construction and shall keep the Premises and the Project
free and clear of all mechanics' liens which may result from construction
by Tenant.
15. RELEASE AND INDEMNITY.
As material consideration to Landlord, Tenant agrees that Landlord, its
agents, and its employees shall not be liable to Tenant, its agents,
employees, sublessee, invitees, licensees and other persons claiming under
Tenant for; (i) any damage to any property entrusted to employees of the
Project, (ii) loss or damage to any property by theft or otherwise, (iii)
consequential damages arising out of any loss of the use of the Premises or
any equipment or facilities therein; or (iv) any injury or damage to person
or property resulting from fire, explosion, falling plaster, steam, gas,
electricity, water or rain which may leak from any part of the PREMISES
from pipes, appliances or plumbing work therein or from the roof, street,
sub-surface or from any other place or resulting from dampness or any other
cause whatsoever. Landlord or its agents shall not be liable for
interference with light or other incorporeal hereditaments, nor shall
Landlord be liable for any latent defects in the Premises or the Project.
Tenant shall give prompt notice to Landlord in case of fire or accidents in
the Premises or in the Project, and of defects therein or in the fixtures
or equipment located therein.
To the fullest extent permitted by law, Tenant agrees to indemnify, defect
(with counsel reasonably satisfactory to Landlord) and hold harmless
Landlord, its agents, successors in interest with respect to the Building
and their directors, officers, partners, employees, shareholders, agents
and representatives and the directors, officers, partners, employees,
shareholders, agents and representatives of the partners of Landlord from
(i) all claims, actions, liabilities, and proceedings arising from Tenant's
use of the Premises or the conduct of its business or from any activity,
work or thing done, permitted or suffered by Tenant, its agents,
contractors, sublessees, employees or invitees, in or about the Premises,
the Building, or the Project and any breach or default in the performance
of any obligation to be performed by Tenant under the terms of this Lease,
or arising from any at, neglect, fault or omission of Tenant, or of its
agents, contractors, sublessees, employees or invitees, and (ii) any and
all costs, attorneys' fees, expenses and liabilities incurred with respect
to any such claims, actions, liabilities, or proceedings, and in the event
any actions or proceedings shall be brought against Landlord by reason of
any such claims. Tenant, upon notice from Landlord, shall defend the same
at Tenant's expense by counsel approved in writing by Landlord. Tenant
hereby assumes all risk of damage to property or injury to person in, upon
or about the Premises from any cause whatsoever except that which is caused
by the failure of Landlord to observe any of the terms and conditions of
this Lease where such failure has persisted for an unreasonable period of
time after Landlord receives written notice of such, and Tenant hereby
waives al its claims in respect thereof against Landlord.
As used herein, the term "liabilities" shall include all suits, actions,
claims and demands and all expenses (including attorneys' fees and costs of
defense) incurred in or about any such liability and any action or
proceeding brought thereon. If any claim shall be made or any action or
proceeding brought against Landlord on the basis of any liability described
in this Paragraph. Tenant shall, upon notice from Landlord defend the same
at Tenant's expense by counsel reasonably satisfactory to Landlord. It is
understood that payment shall not be a condition precedent to recovery upon
the foregoing indemnity. See Addendum (#1)
16. INSURANCE.
Tenant, at its cost, shall pay for and keep in full fore and effect
throughout the Term of this Lease:
(a) COMPREHENSIVE GENERAL LIABILITY OR COMMERCIAL GENERAL LIABILITY
insurance with respect to the Premises and the operations of or on
behalf of Tenant, in, of or about the Premises, including, but not
limited to, personal injury, product liability (if applicable),
blanket contractual, owner's protective, broad from property damage
liability, liquor liability (if applicable) and owned and non-owned
automobile liability in amounts not less than $3,000,00 per occurrence
on the commencement date of this Lease. The insurance policy or
policies shall contain the following provisions: (1) severability of
interest, (2) cross liability, (3) an endorsement naming Landlord,
Landlord's Mortgagees and any other parties in interest designated by
Landlord as additional insured, (4) an endorsement stating "such
insurance as is afforded by this policy for the benefit of the
Landlord and any other additional insured shall be primary as respects
any liability or claims arising out of the occupancy of the Premises
by the Tenant, or Tenant's operations and any insurance carried by
Landlord, or any other additional insured shall be non-contributory,"
(5) with respect to improvements or alterations permitted under this
Lease, contingent liability and builder's risk insurance, (6) an
endorsement allocating to the Premises the full amount of liability
limits required by this Lease, and (7) coverage must be on an
"occurrence basis". "Claims-Made" forms are not acceptable.
(b) WORKERS COMPENSATION COVERAGE as required by law, together with
Employers Liability coverage with a limit of not less than $1,000,000.
(c) TENANT'S PROPERTY INSURANCE: Tenant shall at all times during the term
hereof and at its cost and expense, maintain in effect policies of
insurance covering (1) all Tenant Improvements on the Premises
installed by Tenant, (2) all personal property of Tenant located in or
at the Premises including, but not limited to, fixtures, furnishings,
equipment and furniture, in an amount not less than their full
replacement value, and (3) loss of income or business interruption
covering a period of not less than one (1) year. These policies shall
provide protection against any peril included within the
classification "All Risk" including, but not limited to, insurance
against sprinkler leakage, vandalism and malicious mischief. The
proceeds of such insurance shall be used to repair or replace the
Tenant Improvements and personal property so insured.
All policies of insurance required to be kept or maintained by Tenant AND
LANDLORD hereunder shall include a clause or endorsement denying the
insurer any rights of subrogation against the other party to the extent
rights have been waived by the insured before the occurrence of injury or
loss, if same are obtainable without unreasonable cost. Landlord and Tenant
each hereby waive any rights of recovery against the other for injury or
loss to such waiving party or to its property or the property of others
under its control, arising from any cause required to be insured against
under any policy of insurance required to be carried to be carried by such
waiving party under this Lease. The foregoing waiver shall be effective
whether or not the waiving party shall actually obtain and maintain the
insurance which such waiving party is obligated to obtain and maintain
under this Lease.
All insurance required to be provided by Tenant under this Lease: (a) shall
be issued by insurance companies authorized to do business in the state in
which the Premises are located and holding a General Policyholders Rating
of "A" and a Financial Rating of "X" or better, as set forth in the most
recent edition of Best's Insurance Reports; (b) shall contain an
endorsement requiring at least 30 days prior written notice to Landlord and
Landlord's lender, before cancellation or change in coverage scope or
amount of any policy. Tenant shall deliver a certificate or copy of such
policy together with evidence of payment of all current premiums to
Landlord within 30 days of execution of this Lease and within fifteen (15)
days of expiration of each policy. Tenant's failure to provide evidence of
such coverage to Landlord shall constitute a default under this Lease.
Subject to being reimbursed by Tenant, Landlord shall insure the Building
(excluding all property which Tenant is obligated to insure) against damage
with "All Risk" insurance and public liability insurance (See Addendum #2)
including rental abatement insurance, all in such amounts and with such
deductibles as Landlord considers appropriate, BUT IN NO EVENT LESS THAN
THE REPLACEMENT COST THEREOF. Tenant shall pay, as additional rent, the
cost of any insurance maintained by Landlord hereunder and any other
insurance Landlord may elect to obtain for the PREMISES from time to time
during the Term (including, without limitation, earthquake and/or flood
insurance). Tenant shall pay insurance cost within fifteen days (15) days
after Tenant's receipt of statement from Landlord determining Tenant's
share of the insurance cost. The foregoing notwithstanding, upon notice
from Landlord, Tenant shall pay as additional rent Tenant's share to
Landlord in advance monthly installments equal to one twelfth (1/12) of
Landlord's reasonable estimate of Tenant's share of the insurance premiums
payable under this Lease, together with monthly installments of base rent,
and Landlord shall hold such payments in a non-interest bearing account.
Landlord shall determine and notify Tenant of any deficiency in the impound
account and Tenant shall pay any deficiency of funds in the impound account
within fifteen days (15) days after Tenant's receipt of statement from
Landlord determining Tenant's share of the actual insurance cost. If
Landlord determines that Tenant's impound account has accrued an amount in
excess of Tenant's share, then such excess shall be credited to Tenant
within said notice from landlord. Notwithstanding any contribution by
Tenant to the cost of insurance premiums as provided herein, Tenant
acknowledges that it has no right to receive any proceeds from any
insurance policies carried by Landlord.
17. DESTRUCTION.
If during the Term of this Lease, any portion of the Premises, access to
the Premises or any part of the PROJECT which is essential to the use of
the Premises is damaged or destroyed and such damage or destruction can, in
Landlord's reasonable estimation, be repaired within 180 days following
such damage or destruction, this Lease shall remain in full force and
effect and Landlord shall promptly commence to repair and restore the
damage or destruction to substantially the same condition as existed prior
to such damage and shall complete such repair and restoration with due
diligence in compliance with all then existing laws. If (1) such damage or
destruction cannot, in landlord's reasonable estimation, be repaired within
180 days following such damage or destruction; or (2) more than forty
percent (40%) of the Building is damaged or destroyed (regardless of its
impact on the Premises); or (3) any mortgage of the Building will not allow
the application of insurance proceeds to be applied to repair and
restoration; or (5) the damage or destruction occurs within the last twelve
(12) months of the Term of this Lease or any extension hereof, then
Landlord may, in its sole discretion, terminate this Lease by delivery of
notice to Tenant within 30 days of the date Landlord learns of the damage.
IN THE EVENT ANY MORTGAGE OF THE BUILDING DOES NOT ALLOW THE APPLICATION OF
INSURANCE PROCEEDS TO BE APPLIED TO REPAIR AND RESTORE THE BUILDING,
LANDLORD SHALL REFUND TO TENANT ANY SPECIFIC PREMIUMS COLLECTED FROM TENANT
FOR THE PARTICULAR COVERAGE INVOLVED.
In the event of repair, reconstruction and restoration by Landlord as
herein provided, the rent payable under this Lease shall be abated
proportionately BY AN AMOUNT IN THE SAME RATIO AS THE NUMBER OF SQUARE FEET
IN THE DAMAGED PORTION OF THE PREMISES BEARS TO THE TOTAL NUMBER OF SQUARE
FEET OF THE PREMISES; provided that there shall be no abatement of rent if
such damage is the result of Tenant's negligence or intentional wrongdoing.
Tenant shall not be entitled to any compensation or damages for loss of the
use of the whole or any part of the Premises, damage to Tenant's Personal
Property and/or any inconvenience or annoyance occasioned by such damage,
repair, reconstruction or restoration.
If Landlord is obligated to or elects to repair or restore at herein
provided, Landlord shall be obligated to make repair or restoration only to
those portions of the Building and the Premises which were originally
provided at landlord's expense, and the repair and restoration of items not
provided at Landlord's expense shall be the obligation of Tenant. Tenant
agrees to coordinate the restoration and repair of those items it is
required to restore or repair with Landlord's repair and restoration work
and in coordination with a work schedule prepared by Landlord, or
Landlord's contractor. Further, Tenant's work shall be performed in
accordance with the terms, standards and conditions contained in Paragraph
14 above.
The provisions of California Civil Code Section 1932, Subsection 2, and
Section 1933, Subsection 4, and any other similarly enacted statute or
court decision relating to the abatement or termination of a lease upon
destruction of the leased premises, are hereby waived by Tenant; and the
provisions of this PARAGRAPH 17 shall govern in case of such destruction.
18. CONDEMNATION.
(a) DEFINITIONS. The following definitions shall apply: (1) "Condemnation"
means (a) the exercise of any governmental power of eminent domain,
whether by legal proceedings or otherwise by condemnor and (b) the
voluntary sale or transfer by Landlord to any condemnor either under
threat of condemnation or while legal proceedings for condemnation are
proceeding; (2) "Date of Taking" means the date the condemnor has the
right to possession of the property being condemned; (3) "Award" means
all compensation, sums or anything of value awarded, paid or received
on a total or partial condemnation; and (4) "Condemnor" means any
public or quasi-public authority, or private corporation or
individual, having a power of condemnation.
(b) OBLIGATIONS TO BE GOVERNED BY LEASE. If during the Term of this Lease
there is any taking of all or any part of the Premises or the Project,
the rights and obligations of the parties shall be determined pursuant
to this Lease.
(c) TOTAL OR PARTIAL TAKING. If the Premises are totally taken by
condemnation, this Lease shall terminate on the date of taking. If any
portion of the Premises is taken by condemnation, this Lease shall
remain in effect, except that Tenant can elect to terminate this Lease
if the remaining portion of the Premises is rendered unsuitable for
Tenant's continued use of the Premises. If Tenant elects to terminate
this Lease, Tenant must exercise its right to terminate by giving
notice to Landlord within 30 days after the nature and extent of the
taking have been finally determined. If Tenant elects to terminate
this Lease, Tenant shall also notify Landlord of the date of
termination, which date shall not be earlier than 30 days nor later
than 90 days after Tenant has notified landlord of its election to
terminate; except that this Lease shall terminate on the date of
taking if the date of taking falls on a date before the date of
termination as designated by Tenant. If any portion of the Premises is
taken by condemnation and this Lease remains in full force and effect,
on the date of taking the rent shall be reduced by an amount in the
same ratio as the total number of rentable square feet in the portion
of the Premises taken bears to the total number of rentable square
feet in the Premises immediately before the date of taking. In the
case where a portion of the Premises is taken and the Lease remains in
full force and effect. Landlord shall, at its own cost and expense,
make all alterations or repairs to the Premises so as to make the
portion of the Premises not taken a complete architectural unit. Such
work shall not, however, exceed the scope of work done by Landlord in
originally constructing the Premises. If any portion of the Building
other than the Premises is taken and in Landlord's reasonable opinion
the Building should be restored in a manner that materially alters the
Premises, or if severance damages from the condemning authority are
not available to Landlord in sufficient amounts to permit such
restoration, Landlord may terminate this Lease upon written notice to
Tenant. Basic Monthly Rent due and payable hereunder shall be
temporarily abated during such restoration period in proportion to the
degree to which there is substantial interference with Tenant's use of
the Premises, as reasonably determined by Landlord or Landlord's
architect. Each party hereby waives the provisions of Section 1265.130
of the California Code of Civil procedures and any present or future
law allowing either party to petition the Superior Court to terminate
this Lease in the event of a partial taking of the Building or
Premises.
If the Premises are totally or partially taken by condemnation, Tenant
shall not asset any claim against Landlord or the taking authority for
any compensation because of such taking, and Landlord shall be
entitled to receive the entire amount of the award without any
deduction for any estate of interest of Tenant. NOTWITHSTANDING THE
FOREGOING, TENANT MAY MAKE A SEPARATE CLAIM AGAINST THE CONDEMNING
AUTHORITY FOR ITS MOVING EXPENSES AND OTHER CLAIMS TYPICALLY ALLOWED
OF TENANTS IN SIMILAR SITUATIONS.
19. ASSIGNMENT OR SUBLEASE.
Tenant shall not assign or encumber its interest in this Lease or the
Premises or sublease all or any part of the Premises or allow any other
person or entity (except Tenant's authorized representatives, employees,
invitees, or guests) to occupy or use all or any part of the Premises
without first obtaining Landlord's consent which Landlord shall not
unreasonably withhold. Landlord shall be deemed reasonable in withholding
its consent if it determines in its sole discretion that: (i) the financial
net worth of the proposed assignee or sublessee is not equal to or greater
than Tenant's financial net worth as of the date of this Lease as increased
by the increase in the Consumer Price Index, if any, between the date of
this Lease and the date of the assignment or sublease, (ii) (NOTE:
PREVIOUSLY TYPED LANGUAGE DELETED); (iii) the intended use of the Premises
by the proposed assignee or sublessee will require more than insignificant
alteration of the Premises; (iv) the intended use of the Premises by the
proposed assignee or sublessee will constitute a violation of this Lease or
any governmental law, rule, ordinance or regulation governing the Premises
or would involve the storage, use or keeping of Hazardous Materials (as
defined in Exhibit H attached hereto) in, on or about the Premises, the
Common Areas or any other portion of the Project; or if (v) the proposed
rent for the proposed assignee is less than the Rent then in effect under
the Lease; or (vi) the proposed assignee or sublessee is a tenant in the
Project or has negotiated to be a tenant in the Project any time in the six
(6) months just preceding Tenant's request for Landlord's consent AND
LANDLORD IS THEN LEASING A SIMILAR AMOUNT OF SPACE IN THE PROJECT. Any
assignment, encumbrance or sublease without Landlord's written consent
shall be voidable and at Landlord's election, shall constitute a default.
Landlord's waiver or consent to any assignment or subletting shall not
relieve Tenant of any assignee or sublessee from any obligation under this
Lease whether or not accrued.
If Tenant is a partnership, a withdrawal or change, voluntary, involuntary
or by operation of law of any partner, or the dissolution of the
partnership, shall be deemed a voluntary assignment. If Tenant is a
corporation, any dissolution, merger, consolidation or other reorganization
of Tenant, or sale or other transfer of a controlling percentage of the
capital stock of Tenant, or the sale of at least 25% of the value of the
assets of Tenant shall be deemed a voluntary assignment. The phase
"controlling percentage" means ownership of and right to vote stock
possessing at least 25% of the total combined voting power of all classes
of Tenant's capital stock issued, outstanding and entitled to vote for
election of directors. The preceding two sentences of this paragraph shall
not apply to corporations the stock of which is traded through a public
exchange. If Landlord shall consent to any assignment or sublease of this
Lease, three-quarters (3/4) of all sums and other consideration payable to
or for the benefit of the Tenant from its assignee or subtenant in excess
of the rent payable by Tenant to Landlord under this Lease, or in the case
of a sublease, in excess of the rent fairly allocable to such subleased
portion as reasonably determined by Landlord PLUS, IN EITHER CASE, THE
LEGAL FEES, BROKERAGE COMMISSIONS AND TENANT-PAID ALTERATIONS REQUIRED TO
CONSUMMATE SUCH ASSIGNMENT, shall be paid to Landlord, as and when such
sums are due and payable. If Tenant requests Landlord to consent to a
proposed assignment or subletting Tenant shall pay to Landlord, whether or
not consent is ultimately given, $100 or Landlord's reasonable attorneys'
fees incurred in connection with such request, whichever is greater.
No interest of Tenant in this lease shall be assignable by involuntary
assignment through operation of law (including, without limitation, the
transfer of this Lease by testacy or intestacy). Each of the following acts
shall be considered an involuntary assignment: (a) If Tenant is or becomes
bankrupt or insolvent, makes an assignment for the benefit of creditors, or
institutes proceedings under the Bankruptcy Act in which Tenant is the
bankrupt; or it Tenant is a partnership or consists of more than one person
or entity, if any partner of the partnership or other person or entity is
or becomes bankrupt or insolvent, or makes an assignment for the benefit of
creditors; or (b) If a writ of attachment or execution is levied on this
Lease; or (c) If in any proceeding or action to which Tenant is a party, a
receiver is appointed with authority to take possession of the Premises. An
involuntary assignment shall constitute a default by Tenant and Landlord
shall have the right to elect to terminate this Lease, in which case this
Lease shall not be treated as a asset of Tenant.
20. DEFAULT.
The occurrence of any of the following shall constitute a default by
Tenant: (a) A failure to pay rent or any other charge WITHIN FIVE (5) DAYS
OF THE DATE when due; (b) Abandonment of the premises (failure to occupy
and operate Premises for thirty (30 consecutive days shall be deemed an
abandonment); (c) The making by Tenant or any guarantor of this Lease
("Guarantor") of any general assignment for the benefit of creditors; the
filing by or against Tenant or any Guarantor of a petition to have Tenant
or such Guarantor adjudged a bankrupt or a petition for reorganization or
arrangement under any law relating to bankruptcy (unless, in the case of a
petition filed against Tenant or a Guarantor, the same is dismissed within
sixty (60) days); the appointment of a trustee or receiver to Tenant's
assets located at the Premises or of Tenant's interest in this Lease, of
substantially all of Guarantor's assets, where possession is not restored
to Tenant or such Guarantor, as the case may be, within sixty (60) days;
the attachment, execution or other judicial seizure of substantially all of
Tenant's assets located at the Premises or of Tenant's interest in this
Lease where such seizure is not discharged within sixty (60) days; or if
this Lease shall, by operation of law or otherwise, pass to any person or
persons other than Tenant except as provided in PARAGRAPH 19 herein; (d)
The failure of Tenant to timely comply with the provisions of PARAGRAPH 24
or PARAGRAPH 31 of this Lease regarding, respectively, Subordination and
Estoppel Certificates; or (e) The failure to perform any other provision of
this Lease WITHIN THIRTY (30) DAYS OF LANDLORD'S NOTICE OF SUCH FAILURE,
UNLESS SAME CANNOT BE CURED WITHIN SUCH THIRTY (30) DAY PERIOD, AND IF
TENANT SHALL HAVE PROMPTLY COMMENCED AND BE DILIGENTLY PURSUING SUCH CURE,
THE CURE PERIOD SHALL BE EXTENDED UNTIL TENANT CURES SAME, BUT IN NO EVENT
LONGER THAN NINETY (90) DAYS.
21. LANDLORD'S REMEDIES.
Landlord shall have the remedies described in this PARAGRAPH 21 if Tenant
is in default. These remedies are not exclusive; they are cumulative and in
addition to any remedies now or later allowed by law.
Upon any such default, Landlord may terminate Tenant's right to possession
of the Premises at any time AFTER TEN (10) DAYS NOTICE. No act by Landlord
other than giving notice to Tenant shall terminate this Lease. Act of
maintenance, efforts to relet the Premises, or the appointment of a
receiver on Landlord's initiative to protect Landlord's interest under this
Lease shall not constitute a termination f Tenant's right to possession.
Upon termination of Tenant's right to possession, Landlord has the right to
recover from Tenant; (1) The worth at the time of award of any unpaid rent
which had been earned at the time of termination of Tenant's right to
possession; (2) The worth at the time of award of the amount by which the
unpaid rent which would have been earned after the date of termination of
Tenant's right to possession until the time of award exceeds the amount of
such rental loss that Tenant proves could have been reasonably avoided; (3)
The worth at the time of award of the amount by which the unpaid rent for
the balance of the Term after the time of award exceeds the amount of such
rental loss that Tenant proves could be reasonably avoided; (4) Any other
amount, including court attorney and collection costs, necessary to
compensate Landlord for all detriment proximately caused by Tenant's
default. "The worth" as used for Items (1) and (2) in this PARAGRAPH 21 is
to be computed by allowing interest at the lesser of 12%, whichever is
grater. "The worth" as used for Item (3) in this PARAGRAPH 21 is to be
computed by discounting the amount at the discount rate of the Federal
Reserve Bank of San Francisco at the time of termination plus one
percent(1%).
In the event of any default by Tenant, Landlord shall also have the right,
with or without terminating this Lease, to re-enter the Premises and remove
all persons and property from the Premises; such property may be removed
and stored in a public warehouse or elsewhere at the cost of and for the
account of Tenant or disposed of in a reasonable manner by Landlord. No
re-entry or taking possession of the Premises by Landlord pursuant to this
PARAGRAPH 21 shall be construed as an election to terminate this Lease
unless a written notice of such intention is given to Tenant or unless the
termination thereof is decreed by a court of competent jurisdiction.
22. DEFAULT BY LANDLORD.
Landlord shall not be in default hereunder unless Landlord fails to perform
the obligations required of Landlord within a reasonable time, but in no
event later than forty-five (45) days after written notice by Tenant to
Landlord and to the holder of any first mortgage or deed of trust covering
the Premises, or the lessor of any underlying or ground lease affecting the
Project, in writing specifying wherein Landlord has failed to perform such
obligation, OR IF LANDLORD FAILS TO MAINTAIN THE INSURANCE REQUIRED UNDER
PARAGRAPH 16 HEREOF; provided, however, that if the nature of Landlord's
obligation is such that more than forty-five (45) days is required for
performance, then Landlord shall not be in default if Landlord commences
performance within such forty-five (45) day period and thereafter
diligently prosecutes the same to completion. In no event shall Tenant have
the right to terminate this Lease as a result of Landlord's default;
Tenant's remedies shall be limited to any other remedy available at law or
in equity. Nothing herein contained shall be interpreted to mean that
Tenant is excused from paying rent due hereunder as a result of any default
by landlord. IN THE EVENT OF DAMAGE TO THE PORTIONS OF THE PREMISES WHICH
LANDLORD IS OBLIGATED TO REPAIR AND MAINTAIN UNDER THIS LEASE AND WHICH
AFFECT THE PREMISES TO SUCH AN EXTENT (A) AS TO CAUSE AN IMMINENT THREAT OF
INJURY TO PERSONS OR DAMAGE TO PERSONAL PROPERTY WITHIN THE PREMISES, OR
(B) AS TO PREVENT TENANT'S OCCUPANCY OR USE OF ALL OR ANY MATERIAL PORTION
OF THE PREMISES FOR ITS EXISTING PERMITTED USES, IF LANDLORD FAILS TO
RESPOND WITHIN SEVENTY-TOW (72) HOURS AFTER NOTICE FROM TENANT THEN TENANT
SHALL HAVE THE RIGHT (SO LONG AS TENANT IS NOT IN DEFAULT UNDER THIS LEASE)
TO UNDERTAKE REPAIRS, TO THE EXTENT NECESSARY ONLY TO SECURE THE PREMISES
FROM THE IMMINENT THREAT OF INJURY TO PERSONS OR DAMAGE TO PERSONAL
PROPERTY OR TO ALLOW TENANT TO OPERATE ITS BUSINESS FORM THE PREMISES. THE
COST OF SUCH REPAIRS SHALL BE BORNE BY TENANT, BUT SHALL BE SUBJECT TO
REIMBURSEMENT FROM LANDLORD THROUGH WRITTEN REQUEST FOR PAYMENT ACCOMPANIED
BY COPIES OF ITEMIZED, PAID INVOICES AND LIEN RELEASE WAIVERS EXECUTED BY
ALL CONTRACTORS WHO PROVIDED SUCH REPAIR SERVICES, AND LANDLORD SHALL HAVE
FORTY-FIVE (45) DAYS FROM RECEIPT OF SUCH REQUEST AND ALL SUPPORTING
DOCUMENTATION TO PAY SUCH COSTS TO TENANT.
23. ENTRY OF PREMISES AND PERFORMANCE BY TENANT.
Landlord and its authorized representatives shall have the right to enter
the Premises at all reasonable times DURING NORMAL BUSINESS HOURS AND UPON
TWENTY-FOUR (24) HOURS NOTICE for any of the following purposes: (a) To
determine whether the Premises are in good condition and whether Tenant is
complying with its obligations under this Lease; (b) To do any necessary
maintenance and to make any restoration to the Premises or the Project that
Landlord has the right or obligation to perform under this Lease; (c) To
post "for sale" signs at any time during the Term, to post "for rent" or
"for lease" signs during the last 90 days of the Term, or during any period
while Tenant is in default; (d) To show the Premises to prospective
brokers, agents, buyers, tenants or persons interested in an exchange, at
any time during the Term; (e) To repair, maintain or improve the Project
and to erect scaffolding and protective barricades around and about the
Premises or the Project; or (f) To discharge Tenant's obligations hereunder
when Tenant has failed to do so in accordance with the terms of this Lease.
Landlord shall not be liable in any manner for any inconvenience,
disturbance, loss of business, nuisance or other damage arising out of
Landlord's entry onto the Premises as provided in this PARAGRAPH 23. Tenant
shall not be entitled to an abatement or reduction of rent if Landlord
exercises any rights reserved in this PARAGRAPH 23. Landlord shall
reasonably attempt to conduct his activities on the Premises as provided
herein in a manner that will cause the least inconvenience, annoyance or
disturbance to Tenant. For each of these purposes, Landlord shall at all
times have and retain a key with which to unlock all the doors in, upon and
about the Premises, excluding Tenant's vaults and safes. Tenant shall not
alter any lock or install a new or additional lock or bolt on any door of
the Premises, without the prior written consent of Landlord. If Landlord
gives it s consent, Tenant shall furnish Landlord with a key for any such
lock.
All covenants and agreements to be performed by Tenant under any of the
terms of this Lease shall be performed by Tenant at Tenant's sole cost and
expense without any abatement of rent. If Tenant shall fail to pay any sum
of money, other than Monthly Basic Rent, required to be paid by it
hereunder or shall fail to perform any other act on its part to be
performed hereunder, and such failure shall continue for ten (10) days
after notice thereof by Landlord (or such other period as specifically
provided herein), Landlord may, without waiving or releasing Tenant from
any obligations of Tenant, but shall not be obligated to, make any such
payment or perform any such other act on Tenant's part to be made or
performed in this Lease; provided, however, all sums so paid by Landlord
and all necessary incidental costs together with interest thereon at the
lesser of 12% or the maximum rate an individual is permitted to charge by
law from the date of such payment by Landlord, shall be payable to Landlord
on demand. Tenant covenants to pay any such sums, and Landlord shall have
(in addition to all other rights or remedies of Landlord) the same rights
and remedies in the event of the nonpayment thereof by Tenant as in the
case of default by Tenant in the payment of the rent. FOLLOWING FOUR (4)
LATE PAYMENTS OF RENT DURING ANY TWELVE MONTH PERIOD, LANDLORD SHALL HAVE
THE OPTION TO REQUIRE THAT TENANT INCREASE THE AMOUNT OF SECURITY DEPOSIT
REQUIRED UNDER PARAGRAPH 8 BY FIFTY PERCENT (50%), WHICH ADDITIONAL
SECURITY DEPOSIT SHALL BE RETAINED BY LANDLORD AND MAY BE APPLIED BY
LANDLORD IN THE MANNER PROVIDED IN PARAGRAPH 7.
24. SUBORDINATION.
Without the necessity of any additional document being executed by Tenant
for the purpose of effecting a subordination, and unless otherwise elected
by Landlord or any mortgagee or any beneficiary of a Deed of Trust with a
lien on the Project or any ground lessor with respect to the Project(or any
part thereof), this Lease shall be subject and subordinate at all times to
(a) all ground leases or underlying leases which may now exist or hereafter
be executed affecting the Project, or the land upon which the Project is
situated, or both, and (b) the lien of any mortgage or deed of trust which
may now exist or hereafter be executed in any amount for which the Project,
ground leases or underlying leases, or Landlord's interest or estate in any
of said items is specified as security. Notwithstanding the foregoing,
Tenant acknowledges that Landlord shall have the right to subordinate or
cause to be subordinated this Lease to any such ground leases or underlying
lease or any such liens to this Lease. In the event that any ground leases
or underlying leases or any such liens to this Lease. In the event that nay
ground lease or underlying lease terminates for any reason or any mortgage
or Deed of Trust is foreclosed or a conveyance in lieu of foreclosure is
made for any reason, Tenant shall, notwithstanding any subordination,
attorn to and become the tenant of the successor in interest to Landlord,
and TENANT'S OCCUPANCY OF THE PREMISES SHALL NOT BE DISTURBED FOR SO LONG
AS TENANT IS IN COMPLIANCE WITH THE PROVISIONS OF THIS LEASE. Tenant
covenants and agrees to execute and deliver, upon demand by landlord and in
the form requested by landlord any additional documents evidencing the
priority or subordination of this Lease with respect to any such ground
lease or underlying leases or the lien of any such mortgage or Deed of
Trust. Tenant hereby irrevocably appoints Landlord as attorney-in-fact of
Tenant to execute, deliver and record any such document in the name and on
behalf of Tenant.
Notwithstanding the foregoing, Tenant acknowledges that the Project is
encumbered by a deed of trust including an assignment of rents (the
"Mortgage") in favor of Connecticut General Life Insurance Company
("Mortgagee"), and that this Lease is and shall be subordinate to the lien
of the Mortgage. If Mortgagee succeeds to the interest of Landlord under
this Lease, Tenant acknowledges and agrees that Mortgagee shall not be (i)
liable for any act or omission of any prior landlord (including Landlord),
(ii) liable for the return of any security deposit unless such deposit has
been delivered to Mortgagee by Landlord or is in an escrow fund available
to Mortgagee, (iii) subject to any offsets or defenses that Tenant might
have against prior landlord (including Landlord), (iv) bound by any rent or
additional rent that Tenant might have paid for more than the current month
to any prior landlord (including Landlord), (v) bound by any amendment,
modification or termination of this Lease made without Mortgagee's consent,
(vi) personally liable under this Lease, Mortgagee's liability hereunder
being limited to its interest in the Project, or (vii) bound by any notice
of termination given by Landlord to Tenant without Mortgagee's prior
written consent thereto.
25. NOTICE.
Any notice, demand, request, consent, approval or communication desired by
either party or required to be given, shall be in writing and served either
personally or sent by prepaid certified fist class mail, return receipt
requested, addressed as set forth in SUBPARAGRAPH 1(B) AND 1(C). Either
party may change its address by notification to the other party. NOTICES TO
TENANT SHALL ALSO BE SENT TO GENERAL COUNSEL, 22 HARBOR PARK DRIVE, PORT
WASHINGTON, NEW YORK 11050. Notice shall be deemed to be communicated 48
hours from the time of mailing, or at the time of service as provided in
this PARAGRAPH 25.
26. WAIVER.
No delay or omission in the exercise of any right or remedy by Landlord
shall impair such right o remedy or be construed as a waiver. No act or
conduct of Landlord, including, without limitation, acceptance of the keys
to the Premises, shall constitute acceptance of the surrender of the
Premises by Tenant before the expiration of the Term. Only written notice
from Landlord to Tenant shall constitute acceptance of the surrender of the
Premises and accomplish termination of this Lease. Landlord's consent to or
approval of any act by Tenant requiring Landlord's consent or approval
shall not be deemed to waive or render unnecessary Landlord's consent to or
approval of any subsequent act by Tenant. Any waiver by Landlord of any
default must be in writing and shall not be a waiver of any other default
concerning the same or any other provision of this Lease.
27. LIMITATION OF LIABILITY.
In consideration of the benefits accruing hereunder, Tenant and all
successors and assigns of Tenant covenant and agree that, in the event of
any actual or alleged failure, breach or default hereunder by Landlord or
otherwise pertaining to any obligation of Landlord in respect of the
Premises:
(a) The sole and exclusive remedy against Landlord shall be against the
Landlord's or otherwise pertaining to any obligation of Landlord in
respect of the PROJECT:
(b) No partner, officer, director, owner, shareholder or advisor of
Landlord shall be sued or named as a party in any suit or action
(except as may be necessary to secure jurisdiction of the
partnership);
(c) No service of process shall be made against any partner, officer,
director, owner, shareholder or advisor of Landlord (except as may be
necessary to secure jurisdiction o f the partnership);
(d) No partner, officer, director, owner, shareholder or advisor of
Landlord shall be required to answer or otherwise plead to any service
of process;
(e) No judgment taken against any partner, officer, director, owner,
shareholder or advisor of Landlord may be vacated and set aside at any
time after the fact;
(f) Any judgment taken against any partner, officer, director, owner,
shareholder or advisor of Landlord may be vacated and set aside at any
time after the fact;
(g) No writ of execution will ever be levied against the assets of any
partner, officer, director, owner, shareholder or advisor of Landlord;
(h) The obligations under this Lease do not constitute personal
obligations of the individual partner, officer, director, owner,
shareholder or advisor of Landlord, and Tenant shall not seek recourse
against any such persons or entities of Landlord or any of their
personal assets for satisfaction of a y liability in respect to this
Lease; and
(i) These covenants and agreements are enforceable both by Landlord and
also by any partner, officer, director, owner, shareholder or advisor
of Landlord.
Tenant agrees that each of the foregoing provisions shall be applicable to
any covenant or agreement either expressly contained in this Lease or
imposed by statute or at common law.
28. FORCE MAJEURE.
Landlord shall have no liability whatsoever to Tenant on account of (a) the
inability or delay of Landlord in fulfilling any of Landlord's obligations
under this Lease by reason of strike, other labor trouble, governmental
restrictions, controls or inaction, or shortages of fuel, supplies or labor
resulting therefrom or any other cause, whether similar or dissimilar to
the above, beyond Landlord's reasonable control; or (b) any failure or
defect in the supply, quantity or character of electricity or water
furnished to the Premises, by reason of any requirement, act or omission of
the public utility or others furnishing the Project with electricity or
water, or for any other reason, whether similar or dissimilar to the above,
beyond Landlord's reasonable control. If this Lease specifies a time period
for performance of an obligation of Landlord, that time period shall be
extended by the period of any delay in Landlord's performance caused by any
of the events of force majeure described above.
29. PROFESSIONAL FEES.
(a) If Landlord should engage any professional including, without
limitation, attorneys, appraisers, accountants, environmental or other
consultants for the purpose of bringing suit for possession of the
Premises, for the recovery of any sum due under this Lease, or because
of the breach of any provisions of this Lease, or for any other relief
against Tenant hereunder, or in the event of any other litigation
between the parties with respect to this Lease, then all REASONABLE
costs and expenses including, without limitation, actual professional
fees such as appraisers', accountants', attorneys' and other
consultants' fees, incurred by the prevailing party therein shall be
paid by the other party, which obligation on the part of the other
party shall be deemed to have accrued on the date of the commencement
of such action and shall be enforceable whether or not the action is
prosecuted to judgment. If Landlord employs a collection agency to
recover delinquent charges, Tenant agrees to pay all collection agency
fees charged to Landlord in addition to rent, late charges, interest
and other sums payable under this Lease.
(b) If Landlord is named as a defendant in any suit brought against Tenant
in connection with or arising out of Tenant's occupancy hereunder,
Tenant shall pay to Landlord its costs and expenses incurred in such
suit including, without limitation, its actual professional fees such
as appraisers', accountants' and attorneys' fees.
30. EXAMINATION OF LEASE.
Submission of this instrument for examination or signature by Tenant shall
not create a binding agreement between Landlord and Tenant nor shall it
constitute a reservation or option to lease on the part of Tenant and this
instrument shall not be effective as a lease and shall not create any
obligations on the part of Landlord or Tenant until this Lease has been
validly executed by, and delivered to, both Landlord and Tenant.
31. ESTOPPEL CERTIFICATE.
(a) Within ten (10) BUSINESS days following any written request which
Landlord may make from time to time, Tenant shall execute and deliver
to Landlord a statement, ("Estoppel Certificate") in a form
substantially similar to the form of EXHIBIT E attached hereto or in
such other form as Landlord's lender or purchaser may require,
certifying: (i) the date of commencement of this Lease; (ii) the fact
that this Lease is unmodified and in full force and effect (or, if
there have been modifications, stating the nature and date of such
modification), (iii) the date to which the rent and other sums payable
under this Lease have been paid; (iv) that there are no current
defaults under this Lease by either Landlord or Tenant except as
specified in Tenant's statement; and (v) such other matters requested
by Landlord. Landlord and Tenant intend that any statement delivered
pursuant to this Paragraph 31 may be relied upon by any mortgagee,
beneficiary, purchaser or prospective purchaser of the Project or any
interest therein.
(b) Tenant's failure to deliver such statement within such time shall be
conclusive upon Tenant (i) that this Lease is in full force and
effect, without modification except as may be represented by landlord,
(ii) that there are no uncured defaults in Landlord's performance, and
(iii) that not more than one (1) month's rent has been paid in
advance. Tenant's failure to deliver said statement to Landlord within
ten (10) days of receipt shall constitute a default under this Lease.
(c) Tenant hereby irrevocably appoints Landlord as Tenant's
attorney-in-fact, which appointment is coupled with an interest, to
act in Tenant's name, place and stead to execute such Estoppel
Certificate on Tenant's behalf.
32. RULES AND REGULATIONS.
Tenant shall faithfully observe and comply with the "Rules and
Regulations", a copy of which is attached hereto and marked Exhibit F, and
all reasonable and nondiscriminatory modifications thereof and additions
thereto from time to time put into effect by landlord. Landlord shall not
be responsible to Tenant for the violation or non-performance by any other
tenant or occupant of the Project of any of said Rules and Regulations.
33. LIENS.
Tenant shall, within FIFTEEN (15) days after receiving notice of the filing
of any mechanic's lien for material or work claimed to have been furnished
to the Premises on Tenant's behalf or at Tenant's request, discharge the
lien or post a bond equal to the amount of the disputed claim with a
bonding company reasonably satisfactory to Landlord. If Tenant posts a
bond, it shall contest the validity of the lien with all due diligence.
Tenant shall indemnify, defend and hold Landlord harmless from any and all
losses and costs incurred by Landlord as a result of any such liens
attributable to Tenant. If Tenant does not discharge any lien or post a
bond for such lien within FIFTEEN (15) day period, Landlord may discharge
such lien at Tenant's expense and Tenant shall promptly reimburse Landlord
for all costs incurred by Landlord in discharging such lien including,
without limitation, attorney's fees and costs and interest on all sums
expended at the maximum interest rate permitted by law. Tenant shall
provide Landlord with not less than FIFTEEN (15) days prior written notice
of its intention to have work performed at or materials furnished to the
Premises so that Landlord may post appropriate notices of non-
responsibility.
34. MISCELLANEOUS PROVISIONS.
(a) TIME OF ESSENCE. Time is on the essence of each provision of this
Lease.
(b) SUCCESSOR. This Lease shall be binding on and inure to the benefit of
the parties and their successors, except as provided in PARAGRAPH 19
herein.
(c) LANDLORD'S CONSENT. Any consent required by Landlord under this Lease
must be granted in writing and may be withheld by Landlord in its sole
and absolute discretion, unless otherwise expressly provided herein.
(d) COMMISSION. Each party represents that it has not had dealings with
any real estate broker, finder or other person with respect to this
Lease in any manner. except for the broker identified in SUBPARAGRAPH
1(M). If EITHER PARTY has dealt with any other person or real estate
broker with respect to leasing or renting space in the Project, such
party shall be solely responsible for the payment of any fees due said
person or firm and shall hold the other party free and harmless and
indemnify and defend Landlord from any liabilities, damages or claims
with respect thereto, including attorneys fees and costs.
(e) LANDLORD'S SUCCESSORS. In the event of a sale or conveyance by
Landlord of the Project, the same shall operate to release Landlord
from any liability under this Lease, and in such event Landlord's
successor in interest shall be solely responsible for all obligations
of Landlord under this Lease.
(f) PRIOR AGREEMENT OR AMENDMENTS. This Lease contains all of the
agreements of the parties hereto with respect to any matter covered or
mentioned in this Lease, and no prior agreement or understanding
pertaining to any such matter shall be effective for any purpose. No
provisions of this Lease may be amended or added to except by an
agreement in writing signed by the parties hereto or their respective
successors-in-interest.
(g) RECORDING. Tenant shall not record this Lease nor a short form
memorandum thereof without the consent of Landlord. Landlord may
record a short form memorandum of this Lease and Tenant shall execute
and acknowledge such form if requested to do so by Landlord.
(h) SEPARABILITY. Any provision of this Lease which shall prove to be
invalid, void or illegal shall in no way affect, impair or invalidate
any other provision hereof, and all other provisions of this Lease
shall remain in full force and effect.
(i) NO PARTNERSHIP OR JOINT VENTURE. Nothing in this Lease shall be deemed
to constitute Landlord and Tenant as partners or joint venturers. It
is the express intent of the parties hereto that their relationship
with regard to this Lease and the Premises be and remain that of
lessor and lessee.
(j) INTERPRETATION. This Lease shall be construed and interpreted in
accordance with the laws of the state in which the Premises are
located. This Lease constitutes the entire agreement between the
parties with respect to the Premises and the Project, except for such
guarantees or modifications as may be executed in writing by the
parties from time to time. When required by the context of this Lease,
the singular shall include the plural, and the masculine shall include
the feminine and/or neuter. "Party" shall mean Landlord or Tenant. If
more than one person or entity constitutes Tenant, the obligations
imposed upon Tenant shall be joint and several as to all persons or
entities constituting Tenant. The enforceability, invalidity or
illegality of any provision shall not render the other provisions
unenforceable, invalid or illegal.
(k) MORTGAGEE PROTECTION. In the event of any default on the part of
Landlord, Tenant will give notice by registered or certified mail to
any beneficiary of a deed of trust, mortgagee, or ground lessor
covering the Premises, and shall offer such beneficiary, mortgagee, or
ground lessor, a reasonable opportunity to cure the default, including
time to obtain possession of the Premises by power of sale or a
judicial foreclosure, or in the event of a ground lessor, by
appropriate judicial action, if such should prove necessary to effect
a cure.
IN WITNESS WHEREOF, the parties have executed this Lease as of the date first
above written.
LANDLORD: South Bay Industrials Company, L.L.C.
a Delaware limited liability company
By: /S/ JAMES M. WALSH Date: 9/4/97
James M.Walsh
Its: Vice President
TENANT: Systemax, Inc., a New York corporation
dba: Global Computer Supplies
By: /S/ BRUCE LEEDS Date: 9/3/97
Bruce Leeds
Its: Vice President
ADDENDUM TO SINGLE TENANT INDUSTRIAL LEASE
(NET) BETWEEN SOUTH BAY INDUSTRIALS COMPANY, L.L.C.
AND
SYSTEMAX, INC.
DATED SEPTEMBER 3, 1997
1. To the fullest extend permitted by law, Landlord agrees to indemnify,
defend (with counsel satisfactory to Tenant) and hold harmless Tenant,, its
agents, successors in interest, directors, officers, partners, employees,
shareholders, agents and representatives from (i) all claims, actions,
liabilities, and proceedings arising from any breach or default in the
performance of any obligation to be performed by Landlord under the terms
of this Lease, and (ii) any and all costs, attorney's fees, expenses and
liabilities incurred with respect to any such claims, actions, liabilities,
and proceedings.
2. including a comprehensive boiler and machinery policy,