EXHIBIT 10.2
------------
THIS LEASE made this 10th day of November, 1997, by and between
PEARSON-ENFIELD DEVELOPMENT COMPANY LLC, a Massachusetts limited
liability company, with a usual place of business at c/o Pearson Systems,
Inc., 31 Pearson Way, P.O. Box 180, West Springfield, Massachusetts
(hereinafter called the "Lessor"), and SIMPSON STRONG-TIE, INC., a
California corporation, with a usual place of business at 4637 Chabot
Drive, Suite 200, Pleasanton, California 94588 (hereinafter called the
"Lessee").
WITNESSETH as follows:
Premises
1. That in consideration of the rent and covenants herein
reserved and contained on the part of the Lessee to be paid, performed or
observed, and subject to the terms and conditions herein below set forth,
the Lessor does hereby demise and lease unto the Lessee the premises
(hereinafter the "Demised Premises" or "premises") consisting of a
building to be built by Lessor and which will contain approximately
54,177 leasable square feet on the first floor and a shipping office
mezzanine of 900 square feet, as shown on the lease plan marked Exhibit
"A" attached hereto and made a part hereof and the Lessor's land
(hereinafter at times "Lessor's Land") commonly known as Lot 114, 7
Pearson Way, Enfield, Connecticut.
Term
2. (a) The term of this Lease shall commence when a temporary
Certificate of Occupancy is issued by the Town of Enfield Building
Inspector for the Demised Premises (or earlier if Lessee commences its
business operations in the premises) and shall be for the term of five
(5) years. The commencement date is anticipated to be on or about April
30, 1998. If the term shall commence on other than the first day of a
calendar month, the term shall be increased to terminate five (5) years
after the first day of the calendar month immediately following the
commencement date. In the event the Demised Premises are not available
for Lessee's occupancy by August 1, 1998, then for each day beyond August
1, 1998 that the Lessee is unable to occupy the building because it was
not substantially completed by Lessor as provided in subclause (b) below
(unless the delay was caused by Lessee), Lessee shall receive one day's
free rent based on the per diem of the Annual Minimum Base Rent.
Preparation of Premises
(b) The Lessor covenants that the Demised Premises shall be
completed in a good and workmanlike manner in accordance with the plans
prepared by Architectural Insights, Inc., Project #9750, dated 10/21/97.
The Demised Premises shall be deemed to be substantially completed when
said temporary Certificate of Occupancy is issued. The Lessor shall give
Lessee sixty (60) days' advance notice of the date by which the Demised
Premises is expected to be substantially completed. The Lessor shall
permit the Lessee (at Lessee's sole risk and expense) to enter the
Demised Premises prior to the commencement date for the purpose of
installing equipment, furniture, furnishings and the like so long as the
same does not interfere with the Lessor's work. Lessee shall indemnify,
defend and hold Lessor harmless from all losses or liability arising from
such access except for losses and liability incurred due to Lessor's own
negligence. Lessor shall have no responsibility for Lessee's property in
the Demised Premises prior to the commencement date.
Annual Minimum Base Rent
3. (a) The Annual Minimum Base Rent payable by the Lessee during
Lease Years 1 through 5 of the term shall be the minimum yearly rent of
Two Hundred Seventy Five Thousand Eight Hundred Eighty-Five and 00/100
($275,885) Dollars payable in equal monthly installments of Twenty-Two
Thousand Nine Hundred Ninety and 42/100 ($22,990.42) Dollars; all payable
in advance on the first day of each and every month during the term of
this Lease, and proportionately at said rate for any partial month.
(b) As used herein "Lease Year" shall mean the twelve (12)
month period following the commencement date of this Lease (or if not
commenced on the first day of a month, then first following such
commencement date the first day of the first full calendar month) and
each anniversary thereafter. Checks for rent shall be payable to the
Lessor and sent to it c/o Pearson Systems, Inc., P.O. Box 180, West
Springfield, Massachusetts 01090, until the Lessor directs otherwise in
writing.
Late Payment of Rent
(c) If any rent obligation due hereunder is not paid within ten
(10) days after Lessor's written notice, Lessee shall pay Lessor a late
charge equal to five (5%) percent of such obligation, which late charge
shall also be collectible as additional rent hereunder.
Use of Premises
4. The Demised Premises shall be used solely and only for warehouse
and distribution facility and for training of its personnel. Lessor
represents and warrants to Lessee that the use of the Demised Premises as
set forth in the preceding sentence are permitted uses under the zoning
classifications applicable to Lessor's Land Neither Lessee nor anyone
for whom or which it is legally responsible shall overload or deface the
Demised Premises. Lessor reserves the right to create utility and similar
easements, provided such easements will not interfere with Lessee's use
of the Demised Premises.
Lessee's Share of Lessor's Operating Costs and Expenses
5. This Lease is intended to be a so-called "triple net lease". The
Lessee shall pay to the Lessor in addition to the Annual Minimum Base
Rent and other payments to be paid hereunder, as additional rent, the
Lessor's costs and expenses paid or incurred by Lessor in operating,
repairing, maintaining and managing the Demised Premises. Such costs and
expenses shall include, but not be limited to: real estate taxes, special
assessments, landscaping, water and sewer charges, electric power and
lighting, heating and cooling, repairs, maintenance, building, casualty
and liability insurance, cleaning, refuse removal, snow plowing and
repairs and maintenance (including repaving) of all the paved areas of
roadways and parking lots. However, expressly excluded herefrom shall be
any (i) major repairs of a capital nature (except repaving) or (ii)
structural repairs due to defective workmanship or materials involving
the Demised Premises, parking lot and roadways which occur within two (2)
years after tenant occupies the premises. Except as otherwise expressly
provided in this Lease, Lessor shall have no obligation to furnish any of
the aforesaid. "Real estate taxes" are predicated upon the present system
of taxation in the State of Connecticut. If taxes upon rentals or other
taxes shall be substituted, in whole or in part, for the present system
of real estate taxes, then Lessee's obligation for taxes (as set forth
above) shall be based upon such taxes on rentals and such other taxes to
the extent to which the same shall be a substitute for the present system
of real estate taxes.
Option to Extend
6. (a) Lessee shall have the right to extend the original term of
this Lease for an additional term of five (5) years, provided that Lessee
shall not be in default hereunder either at the time Lessee exercises
such right or at the expiration of the original term and provided that
this Lease shall not have been terminated. Lessee shall have no further
options to extend.
(b) Such extension shall be on the same terms, covenants and
conditions as are contained in this Lease, except for the change in the
Annual Minimum Base Rent payable as provided in subclause (c) below.
Such right to extend shall be exercised by written notice to Lessor given
at least twelve (12) months prior to the expiration of the original term.
(c) During the extended Lease term Lessee shall pay a new
Annual Minimum Base Rent equal to the fair market rental value of the
Demised Premises as of the commencement of the new extended term based on
a five (5) year Lease of comparable premises (the "market rent"), and
shall be determined as follows:
(1) Within thirty (30) days after Lessor receives Lessee's
notice of its exercise of the option to extend the original term of this
Lease, Lessor will submit to Lessee its determination of the then market
rent. If Lessee disputes such determination in writing to Lessor, and
the Lessor and Lessee cannot agree in writing on the market rent within
sixty (60) days after Lessee's notice of the exercise of its option,
Lessee, at its expense, shall obtain and deliver in writing to Lessor a
determination of the market rent for the Premises for a term equal to the
option term from a broker ("Lessee's Broker") licensed in the State of
Connecticut and engaged in the commercial real estate brokerage business
in the Greater Enfield area for at least the immediately preceding five
(5) years. If Lessor accepts such determination, the Annual Minimum Base
Rent for the option term shall be increased to an amount equal to the
amount determined by Lessee's Broker. Lessee's Broker shall make such
determination in writing within forty-five (45) days after the expiration
of the aforesaid sixty (60) days, and a written determination of Lessee's
Broker shall set forth in reasonable detail the basis for his
determination.
(2) If Lessor does not accept such determination in
writing, within fifteen (15) days after the receipt of the determination
of Lessee's Broker, Lessor shall designate its broker ("Lessor's
Broker"), also licensed in the State of Connecticut and also engaged in
the commercial real estate brokerage business in the Greater Enfield area
for at least the immediately preceding five (5) years. Within forty-five
(45) days of the appointment of Lessor's Broker, Lessor, at its expense,
shall deliver in writing to Lessee the determination of such market rent
by Lessor's Broker. Such determination shall be in writing and shall
contain in reasonable detail the basis for the determination by Lessor's
Broker.
(3) If the difference between the market rent as
determined by the two brokers is less than ten (10%) percent, then such
rent shall be averaged and the market rent for the extended term shall be
such average. If the difference between the market rents so determined
shall exceed ten (10%) percent of the lesser of such amounts, then the
two brokers shall have ten (10) days after written request by either
party to appoint a third broker. If such brokers fail to do so within
such ten (10) day period, then either Lessor or Lessee may request the
American Arbitration Association or any successor organization to appoint
an broker within ten (10) days thereafter. If no such broker shall be
appointed within such ten (10) day period, either Lessor or Lessee may
apply to any court having jurisdiction to have such appointment made by
such court. Such broker must satisfy the qualifications for a broker as
provided in the preceding Paragraphs (1) and (2). Any broker appointed
by the original brokers or by the American Arbitration Association or its
successor, or by the court, shall be instructed to determine the market
rent in accordance with the definition of market rent set forth herein,
such determination to be made within thirty (30) days after the
appointment. If the third determination shall exceed the higher of the
first two determinations, the market rent shall be the higher of the
first two determinations. If the third determination is less than the
lower of the first two determinations, the market rent shall be the lower
of the first two determinations. In all other cases, the market rent
shall be equal to the third determination. In no event shall the market
rent determined above be less than Two Hundred Seventy Thousand Eight
Hundred Eighty-Five and 00/100 ($270,885) Dollars per Lease Year. All
such determinations of market rent shall be final and binding upon Lessor
and Lessee as the market rent for the extended term. Each party shall
pay for the fees and expenses of the broker appointed by it, but the fees
and expenses of the third broker shall be shared equally by the parties.
(d) If the amount of the market rent is not known as of the
commencement of the option term, then Lessee shall continue to pay the
Annual Minimum Base Rent in effect at the expiration of the initial term
until the amount of the market rent is determined. When such
determination is made, Lessee shall pay to Lessor any deficiency upon
demand.
Lessee's General Covenants
7. In addition to all other covenants and agreements of the Lessee
contained in this Lease, the Lessee covenants and agrees at all times
during the term hereof, and for any further time as it shall hold the
Demised Premises or any part thereof: to pay when due all Annual Minimum
Base Rent and additional rent provided for herein; to save the Lessor
harmless from all loss and damage occasioned by the use of water in or
escape of water from the Demised Premises, or by the bursting or cracking
of the water pipes, or the stopping or leakage of water, gas, sewer,
steam, or other pipes, including the sprinkler system if any, unless
caused by Lessor's own negligence; to remove its goods and effects, and
those of all persons claiming under it, at the termination or expiration
of this Lease, and will peaceably yield up said Demised Premises and all
additions thereto to the Lessor, and leave the same clean and in such
repair, order and condition as the same are in at the commencement of the
term or may be put in during the continuance thereof, excepting
reasonable wear and tear, and damage by fire or other unavoidable
casualty; not to commit any nuisance, or overload, damage or deface the
Demised Premises; not to permit any holes to be drilled or made in the
stone, brickwork, walls or partitions of the Demised Premises (except
wall hangings but any damage caused by the removal thereof to be repaired
by Lessee); not to carry on any business or occupation which shall be
unlawful, or contrary to any applicable law or ordinance in force for the
time being; not to do any act or thing upon the premises outside of the
scope of uses permitted under Clause 4 which will make them uninsurable
against fire, or which is liable to increase the premium for fire
insurance on the Demised Premises and will reimburse Lessor for all extra
and/or additional premiums caused by Lessee's use; to install, maintain
and keep the premises equipped with all fire or safety appliances
required by law or ordinances, or by any order or regulation of any
public authority, or by the underwriting insurance company because of the
use made of said premises by the Lessee, and will make all non-structural
and non-capital (and if there is a material change of use, then also
structural and capital) repairs, alterations, replacements, or additions
so required; and will procure any authorizations or licenses required for
Lessee's use of the premises; will permit the Lessor to enter at
reasonable times, after twenty-four (24) hours' advance notice (unless
there is an emergency) so as not to unreasonably interfere with Lessee's
business activities, to view the premises and to make, if it so elects,
repairs or alterations necessary for the preservation and safety of the
Demised Premises and will permit the Lessor to show the premises to
others.
Lessor's Repairs
8. Upon written notice from the Lessee, the Lessor shall repair, if
necessary, and if reasonably possible within thirty (30) days of the date
of said notice, the building's roof, exterior walls (but not including
plate or other glass of the Demised Premises) and shall make all
structural repairs, repairs to the parking lot and roadways, and repairs
to plumbing and electrical systems, except for (i) reasonable wear and
tear, (ii) damage caused by any act or negligence of the Lessee, its
agents, employees, invitees or any person for whom Lessee is legally
responsible, but only to the extent Lessor cannot collect on its
insurance for such damage, and (iii) except as provided in Clause 16
damage by fire or other unavoidable casualty. All repair costs shall be
operating costs and expenses under Clause 5 (except as expressly excluded
thereunder).
Lessee's Repairs
9. (a) The Lessee covenants and agrees to keep the interior of the
Demised Premises, its components and equipment, and all plate glass in
good order, condition and repair, reasonable wear and tear and damage by
fire or other unavoidable casualty excepted. Excepted from this provision
shall be any repairs required due to any act or negligence of Lessor, its
agents, employees, invitees or any person for whom Lessor is legally
responsible. However, Lessee shall also be responsible for all repairs
and damage caused by any act or negligence of Lessee, its agents,
employees, invitees or any person for whom Lessee is legally responsible,
but only to the extent Lessor cannot collect on its insurance for such
damage. Lessee shall keep the outside areas clean and neat.
(b) Notwithstanding the foregoing, the Lessee shall not be
responsible for any defective materials or workmanship of the Lessor
discovered within two (2) years from the date Lessor substantially
completes the construction of the Demised Premises.
(c) If the Lessee shall not within ten (10) days after written
notice by the Lessor of repairs to be made by the Lessee commence to make
such repairs and carry same through with dispatch (or in the cases of
emergencies without any written notice), the Lessor may make such repairs
and the reasonable expense thereof shall constitute a debt by the Lessee,
payable as additional rent.
Heat and Condition
10. The Lessee, at its expense, shall supply throughout the term
hereof heat for the building on the Demised Premises, and Lessee shall at
all times heat the Demised Premises to at least 45 degrees to avoid
freezing of pipes.
Utilities
11. Lessee shall pay for its own utilities including, but not
limited to electricity and gas. The electric and gas meters for the
Demised Premises shall be in Lessee's name.
Alterations Improvements
12. The Lessee shall make no alterations, changes and or
improvements in or to the Demised Premises without written consent of
Lessor, which as to nonstructural and nonmechanical/electrical shall not
be unreasonably withheld nor approval unreasonably delayed. Alterations,
changes or improvements to the Demised Premises that are approved in
writing by Lessor shall be constructed by Pearson Systems, Inc. at
Lessee's cost and expense, provided said Company's prices are at market
rates.
Removal of Fixtures
13. The Lessee may, during the term hereof and at the termination
of this lease, remove all fixtures and equipment installed by it but all
additions made by either the Lessor or Lessee which are attached to the
premises, including floor coverings, shall be allowed to remain in place
unless the Lessor shall notify Lessee, within fourteen (14) days after
Lessee's written notice stating what it intends to install, that the
Lessee will be required to remove the same. The Lessee shall, at its
own expense, repair any and all damage to the premises resulting from or
caused by the removal of the fixtures or other equipment or property of
the Lessee.
Indemnification
14. (a) The Lessee covenants and agrees to indemnify and defend the
Lessor against, and to save it harmless from, any and all claims of
whatever nature, actions, loss, damages, liability and expense (including
reasonable attorney's fees) in connection with loss of life, personal
injury and property damage arising out of or resulting from (i) any
occurrence within or on the Demised Premise, unless due to the act or
omission of the Lessor, its agents, employees, invitees, or any other
person for whom the Lessor is legally responsible or (ii) any act or
omission of the Lessee, its agents, employees, invitees, or any other
person for whom the Lessee is legally responsible, whether or not in or
on the Demised Premises.
(b) The Lessor covenants and agrees to indemnify and defend the
Lessee against, and to save it harmless from, any and all claims of
whatever nature, actions, loss, damages, liability and expense (including
reasonable attorney's fees) in connection with loss of life, personal
injury and property damage arising out of or resulting from (i) any
occurrence outside of the Demised Premises or on the parking lot, unless
due to the act or omission of the Lessee, its agents, employees,
invitees, or any other person for whom the Lessee is legally responsible
or (ii) any act or omission of the Lessor, its agents, employees,
invitees, or any other person for whom the Lessor is legally responsible,
whether or not in or on the Demised Premises.
(c) The Lessor agrees not to seek indemnification directly from
the assets of the Lessee pursuant to Section 14(a) until the Lessor has
received all amounts recoverable after final judgment on an action by the
Lessor to recover on, or payment of the policy limit on, the liability
insurance policy or policies purchased by the Lessee pursuant to Clause
16.
(d) The Lessee agrees not to seek indemnification directly from
the assets of the Lessor pursuant to Section 14(b) until the Lessee has
received all amounts recoverable after final judgment on an action by the
Lessee to recover on, or payment of the policy limit on, the liability
insurance policy or policies purchased or caused to be purchased by the
Lessor.
Insurance By Lessee
15. (a) The Lessee shall maintain with respect to the Demised
Premises comprehensive general liability insurance (which may exclude
hazardous wastes), with appropriate contractual liability endorsements
covering all of the Lessee's obligations under Clause 14, and covering
personal injuries and property damage with limits not less than
$1,000,000 for any injury, death, or property damage which arises out of
a single occurrence, and a $3,000,000 annual aggregate for multiple
occurrences. Such insurance shall be written by a company licensed in
Connecticut and shall not include any deductibles unless approved by
Lessor in writing. The insurance policy shall name the Lessor as an
"additional insured" and coverage shall not be canceled except on thirty
(30) days' advance written notice to the Lessor. The Lessee shall
deliver to the Lessor a certificate of said insurance by the term
commencement date. If the Lessee shall fail to comply with this Clause,
Lessor may purchase such insurance and the reasonable expense thereof
shall constitute a debt by the Lessee payable to Lessor as additional
rent.
(b) Lessee shall insure its own personal property and leasehold
improvements at its own expense.
Damage By Fire, Eminent Domain
16. (a) The Lessor and Lessee covenant and agree that in case the
Demised Premises, or any part thereof, or the whole or any part of the
Demised Premises shall be taken for any street or other public use, or
shall be destroyed or damaged for fire or other casualty, or by the
action of the city or town or other authorities, or shall receive any
direct or consequential damage for which the Lessor or the Lessee shall
be entitled to compensation by reason of anything lawfully done in
pursuance of any public authority, after the execution hereof and before
the expiration of the then existing term hereof, then this Lease and the
said term shall terminate at the election of the Lessor, and such
election may be made in case of any such taking, notwithstanding the
entire interest of the Lessor may have been divested by such taking; and
if the Lessor shall not so elect, then in case of any such taking, or
destruction of, or damage of the Demised Premises, rendering the same or
any part thereof unfit for use and occupation, a just proportion of the
rent hereinbefore reserved, according to the nature and extent of the
injury sustained by the Demised Premises, shall be suspended or abated
until the Demised Premises, or, in the case of such taking what may
remain thereof, shall have been put in proper condition for the said use
and occupation by Lessee substantially as it had prior to said taking,
damage or destruction. However, the Lessor shall not make such election
to terminate the lease if the damage to the building by fire or other
casualty is less than $50,000. The Lessee hereby releases and discharges
the Lessor from any claims it may have or may in the future have against
the Lessor by reason of any taking as hereinbefore set forth; and the
Lessee hereby assigns to the Lessor any and all claims and demands or
damages on account of such taking or for compensation for anything
lawfully done in pursuance of any public authority, and covenants with
the Lessor that the Lessee will, from time to time, execute and deliver
to the Lessor such further instruments of assignment of any such claims
and demands as the Lessor shall reasonably request, provided, however,
that the Lessee shall be entitled to recover for its fixtures, personal
property and relocation expenses.
(b) Notwithstanding anything herein to the contrary, in the
event that as a result of such destruction or damage by fire or other
casualty the parties determine in good faith that the building cannot be
substantially restored or repaired within one hundred fifty (150) days
after settlement of the insurance claim, but in any event not within one
hundred eighty (180) days of the event of damage, then Lessee shall have
the right to terminate this Lease upon thirty (30) days' advance written
notice to Lessor but only provided that Lessee gives said notice within
thirty (30) days of the date upon which such casualty occurred.
Waiver of Subrogation
17. Each party will on request of the other, when it can be arranged
without affecting the requested party's rights to settle losses and
receive proceeds and without cost, or the requesting party agrees to pay
the cost, cause the requested party's fire and casualty insurance with
respect to the Demised Premises and property therein to be so written
that the insurer will not have rights of subrogation against the
requesting party. Each party hereby waives any right of recovery against
the other for loss of injury to the extent the waiving party is protected
by insurance so written.
Assignment, Sublet
18. Notwithstanding any other provisions herein contained, the
Lessee may not assign this lease without the written consent of the
Lessor which shall not be unreasonably withheld or delayed. In the event
of an assignment, Lessee shall remain liable for all obligations of the
Lessee hereunder, including payment of rent and other charges under this
Lease, notwithstanding any direct dealings which Lessor may thereafter
have with such Assignee. The Lessee, subject to Lessor's approval not to
be unreasonably withheld or delayed, shall have the right to sublet the
whole or any part of the Demised Premises. If Lessee is a non-public
corporation and if at any time during the term hereof the person or
persons who own a majority of its voting shares at the time such company
becomes a Lessee under this Lease cease to own a majority of such shares,
such cessation shall be deemed an assignment of this Lease which shall be
a default hereunder.
Lessor's Remedies In Case Of Default
19. (a) A default shall be considered to have occurred if payment
of all Annual Minimum Base Rent and/or additional rent shall not have
been made when due and if such failure to pay shall continue for ten (10)
days after Lessor's written notice, or Lessee's failure to insure as
required in Clause 15(a) which is not cured within ten (10) days after
Lessor's written notice, or if within thirty (30)days after written
notice thereof from Lessor to Lessee specifying any other default or
defaults Lessee has not cured such default or defaults (or if the same
cannot be reasonably cured within said thirty (30) day time period by
exercising due diligence, then such additional reasonable time for Lessee
to cure provided Lessee continues to use due diligence to cure, but not
more than an additional thirty (30) days). In the event (a) of any
breach or default of any of the terms and covenants of this Lease to be
performed or observed by Lessee, (b) the estate hereby created in Lessee
is taken by process of law, (c) Lessee shall file a voluntary petition of
bankruptcy, (d) any involuntary petition initiating a bankruptcy
proceeding is filed against Lessee and is not dismissed within thirty
(30) days, (e) Lessee is adjudicated bankrupt, (f) Lessee shall make an
assignment for the benefit of creditors or take the benefit of any
insolvency law, or (g) a receiver is appointed for Lessee, then Lessor
may, upon five (5) days' prior written notice to the Lessee, expel and
remove from the Demised Premises by summary process or other legal means,
Lessee and those claiming under it and its effects, without being guilty
of any manner of trespass, thereby terminating this Lease without
prejudice to any remedies which Lessor might otherwise be entitled to for
arrears of rent or otherwise. In the event of such termination, Lessee
shall indemnify Lessor against all loss of rent and its costs and
expenses which Lessor may reasonably incur by reason of such termination;
provided, however, if the Demised Premises are relet in whole or in part,
the Lessee shall be entitled to a credit in the net amount of rent
received by the Lessor with respect to such reletting but after Lessor is
first reimbursed for its reasonable expenses incurred in preparing the
premises for reletting and its other costs and expenses due to such
termination or reletting.
(b) Lessee covenants and agrees to pay to Lessor reasonable
legal costs and reasonable attorney's fees incurred by the Lessor in
collecting any rent or other damages hereunder, in obtaining possession
of the Demised Premises by summary process or otherwise, or in enforcing
any provisions of this Lease. If Lessor re-enters the Demised Premises
for any cause, or if Lessee abandons or vacates the Demised Premises, any
property left in the Demised Premises by Lessee shall be deemed to have
been abandoned by Lessee, and Lessor shall have the right to retain or
dispose of such property in any manner without any obligation to account
therefor to Lessee.
Quiet Enjoyment
20. The Lessee, subject to the terms and provisions of this Lease,
on payment of all rent and observing, keeping and performing all
of the terms and provisions herein contained on Lessee's part to be
performed, kept and observed, shall peaceably and quietly hold and enjoy
the premises hereby demised.
Holding Over
21. If Lessee holds over or continues in possession of the Demised
Premises after the expiration of this Lease and without the execution of
a new lease between the parties, the tenancy thus created shall be one
from month to month. All covenants, obligation, conditions and agreements
herein contained shall so far as applicable apply to all holding over by
the Lessee as a tenant at will. However, notwithstanding the aforesaid,
in the event the Lessee fails to vacate the Demised Premises upon
expiration of the term of this Lease, or upon termination for default,
the Lessee shall be liable for all damages incurred by the Lessor as well
as future rental income lost to Lessor as a result of the Lessor's
inability to deliver the premises to a new tenant; except, however, that
Lessee's liability pursuant to this sentence shall not exceed an amount
equal to six (6) months' rent hereunder.
Governing Law; Headings
22. This Lease shall be governed by the laws of the State of
Connecticut. The headings of the various clauses are for convenience
only, and not to be considered in construing this Lease. This Lease
shall be construed as if drafted by both parties.
Notices
23. All notices that may be given hereunder by Lessor or Lessee
shall be by registered or certified mail, return receipt requested,
addressed in the case of Lessor to c/o Pearson Systems, Inc., P.O. Box
180, West Springfield, Massachusetts 01090; and all notices that may be
given to Lessee shall be addressed to 4637 Chabot Drive, Suite 200,
Pleasanton, California 94588.
Invalidity
24. If any provision of this Lease shall prove to be invalid, such
invalidity shall only affect the part of such provision which shall be
invalid, and no other portion or provision of this Lease shall be
invalidated, impaired, or affected thereby.
Waiver by Lessor
25. Failure on the part of the Lessor or Lessee to complain of any
action or non-action on the part of each other, no matter how long the
same may continue, shall never be deemed to be a waiver by the Lessor or
Lessee of any of its rights hereunder.
Subordination
26. (a) It is agreed that the rights and interest of the Lessee
under this lease shall be subject to and subordinate to any mortgages (or
deeds of trust) that are now or may hereafter be placed upon the Demised
Premises, and to any and all advances to be made thereunder, and to the
interest thereon and charges thereunder, and all renewals, modifications,
replacements and extensions thereof; provided, however, that Lessee
receives a nondisturbance agreement in customary form. Any such mortgage
(or deed of trust) to which the Lease shall be subordinated may contain
such terms, provisions and conditions as the holder deems usual or
customary, including but not limited to provisions requiring Lessee to
attorn to the mortgagee (or trustee) and agreeing that such mortgagee (or
trustee) shall have no liability for any defaults by Lessor prior to such
mortgagee (or trustee) taking possession of Demised Premises nor
responsibility for completion of construction of the building and other
improvements. The Lessee shall execute and deliver whatever instruments
may be required to effectuate such subordination, said attornment, said
agreement of no liability, and to execute a consent to the assignment of
this Lease if requested by any such mortgagee (or trustee), and in the
event Lessee fails so to do within ten (10) days after written demand by
Lessor, Lessee does hereby make, constitute and irrevocably appoint
Lessor as its attorney in fact and in its name, place and stead to do so.
This agreement shall be made to expressly bind and inure to the benefit
of the successors and assigns of Lessee and of the mortgagee (or trustee)
or upon anyone purchasing a interest in said Demised Premises at any
foreclosure sale.
(b) The Lessor will use reasonable diligence to obtain such
nondisturbance agreement within sixty (60) days after the execution of
this Lease for any existing mortgages and deeds of trust and within
forty-five (45) days for any new mortgages or deeds of trust granted
after the date hereof.
(c) Notwithstanding the foregoing, any holder of a mortgage (or
deed of trust) of property which includes the Demised Premises may at any
time subordinate the mortgage (or deed of trust) to this Lease, without
Lessee's consent, by notice to Lessee and thereupon this Lease shall be
deemed prior in lien to such mortgage (or deed of trust) without regard
to their respective dates of execution, delivery and record; and in that
event such holder shall have the same rights with respect to this Lease
as though it had been executed and delivered prior to the execution and
delivery of the mortgage (or deed of trust) and had been assigned therein
to such mortgagee (or trustee). This paragraph is supplementary to and
not in derogation of any rights such a holder may otherwise have.
Estoppel
27. The Lessee agrees from time to time, when reasonably needed for
delivery to a prospective real estate purchaser or mortgagee or mortgage
assignee upon not less than ten (10) days' prior written request by
Lessor, to execute, acknowledge and deliver to Lessor a statement in
writing certifying: (a) that this lease is unamended (or, if there have
been any amendments, stating the amendments); (b) that it is then in full
force and, effect, if that be the fact; (c) the last rent rates and other
charges determined and the date to which paid; and (d) any defenses,
offsets and counterclaims which Lessee, at the time of the execution of
the statement, has against Lessee's obligation to pay rent and to perform
its other obligations under this Lease or that there are none, if that be
the fact. Any such statement delivered pursuant to this clause may be
relied upon by such prospective purchaser, mortgagee or assignee.
Occupation, Acknowledgment
28. Subject to a good faith mutually agreed punch list, Lessee's
occupation of the Demised Premises will constitute acknowledgment that
the same is in good and satisfactory order, repair and condition, and
that Lessor has substantially satisfied its obligations to prepare the
Demised Premises for occupancy.
Rules & Regulations
29. Lessor shall have the right to make such reasonable rules and
regulations as, in Lessor's judgment from time to time, be necessary or
advisable for the appearance, safety, care and preservation of the
Demised Premises and for the keeping of good order therein. Upon receipt
by Lessee, such rules and regulations shall be deemed to be covenants of
this lease, and shall include, but not be limited to, provisions
regulating signs for Lessee, window covering or other treatment, use of
outside areas, and the like.
Trustee, Partnership
30. In the event that the Lessor is a partnership, no partner,
General or Limited, of such partnership, or if a trust, no trustee
thereof or beneficiary thereunder, or if a limited liability company or
partnership, no member thereof shall be personally liable to anyone under
any term, condition, covenant, obligation, or agreement expressed herein
or implied hereunder or for any claim of damage or cause at law or in
equity arising out of the occupancy of said Demised Premises, the use or
the maintenance of the Lessor's building or its approaches and equipment.
Persons Bound, etc.
31. Except as herein otherwise provided, the terms and provisions of
this Lease shall be binding upon and inure to the benefit of the heirs,
devisees, personal representatives, successors and assigns, respectively,
of the Lessor and Lessee. Nothing in the immediately preceding sentence
shall be construed as a consent by Lessor to an assignment of this Lease,
and said sentence shall apply to an assignee only when Lessor has
specifically and expressly consented to such an assignment pursuant to
Clause 18. The person or entity who or which was the Lessor shall not be
liable for obligations of the Lessor hereunder accruing after it has
ceased to own the Demised Premises.
Performance of Obligations
32. (a) With respect to any services to be furnished to Lessee or
Lessor or any other obligations of Lessor or nonmonetary obligations of
Lessee, each party ("first party") shall in no event be liable to the
other ("second party") for failure or delay caused by war, strikes, labor
difficulties, lockouts, breakdown, accident, order or regulation of
governmental authority, failure of supply, or inability, by exercise of
reasonable diligence, to obtain supplies, parts or employees necessary to
perform such services or obligations, or for any other cause beyond the
first party's reasonable control, or for any cause due to any act or
neglect on the part of the second party or its agents, employees,
invitees or any person for whom such party is legally responsible; and in
no event shall the Lessor or Lessee (except as provided in the last
sentence of Clause 21) ever be liable to each other for any indirect,
consequential or punitive damages or any inconvenience to such other
party, or interruption of such other party's business.
(b) The Lessor shall in no event be in default in the
performance of any of its obligations hereunder unless and until the
Lessor shall have failed to perform such obligations within thirty (30)
days or such additional time as is reasonably required to correct any
such default after written notice by Lessee to Lessor properly specifying
wherein the Lessor has failed to perform any such obligation.
Covenant of Title
33. Lessor covenants and warrants that Lessor has full right and
lawful authority to make this Lease for the full term hereof and it has
good title to the Demised Premises, subject to any mortgage now or
hereafter of record and further subject to such other encumbrances,
easements, and restrictions of record which will not substantially
adversely affect Lessee's use of the Demised Premises.
Compliance with Laws
34. Lessor acknowledges and warrants that the Demised Premises, upon
its completion of construction, shall be in full compliance with all
applicable law, rule, regulation, code, by-law or ordinance in force in
the Town of Enfield, Connecticut. In no event shall the Lessee conduct
(or suffer or allow to be conducted) any trade, business or occupation in
or make any use of, the Demised Premises which is or will be unlawful or
contrary to any such governmental provision. Lessor acknowledges and
warrants that the Demised Premises, upon its completion of construction,
will comply with the applicable provisions of the Americans With
Disabilities Act and regulations promulgated thereunder. However, if
Lessee at any time hereafter makes any alterations to the Demised
Premises, Lessee shall be responsible to comply with all applicable
governmental requirements, including but not limited said Americans With
Disabilities Act.
Payment Under Protest
35. Lessor and Lessee agree that if at any time a dispute shall
arise as to the propriety or necessity of the Lessee mailing any payment
or performing any obligations required hereunder, the Lessee may pay or
perform the same under protest and such payment or performance under
protest shall not be construed to be voluntary on the part of the Lessee.
Notice of Lease
36. Lessor and Lessee agree that within thirty (30) days of the
execution of the Lease, each shall execute a Notice of Lease for
recording in the Land Records.
Environmental Provisions
37. (a) Lessee shall not cause or permit any Hazardous Substance to
be used, stored, generated, or disposed of on or in or released from the
Demised Premises by Lessee or its agents, employees, contractors or
invitees, without first obtaining Lessor's written consent, except Lessee
may to the extent reasonably necessary for the conduct of its business
use such Hazardous Substance but only in such amounts reasonably
necessary from time to time and provided they are properly stored and no
contamination occurs and Lessee is in strict compliance with all laws,
ordinances and regulations governing such activity. If Hazardous
Substances are used, stored, generated, or disposed of on or in or
released from the Demised Premises by Lessee or its agents, employees,
contractors or invitees, or if the Demised Premises or any surrounding
property become contaminated in any manner caused by Lessee or its
agents, employees, contractors or invitees, Lessee shall indemnify,
defend, and hold harmless the Lessor from any and all claims, damages,
fines, judgments, penalties, costs, liabilities, or losses (including
without limitation, a decrease in value of the Demised Premises or the
buildings of which they are a part, damages because of adverse impact on
marketing of the space, lost rental income, lost profits and any and all
sums paid for settlement of claims, attorneys, consultant, and expert
fees) arising during or after the lease term and arising as a result of
such contamination by Lessee. This indemnification includes, without
limitation, any and all costs incurred because of any investigation of
the site or any cleanup, removal, or restoration mandated by a federal,
state or other applicable governmental agency or authority if the
condition of occurrence necessitating the same is caused by the Lessee or
its agents, employees, contractors or invitees. In addition, if Lessee
causes or permits the presence of any Hazardous Substance on the Demised
Premises and this results in contamination, Lessee shall promptly, at its
sole expense, take any and all necessary actions to return the Demised
Premises to the condition existing before the presence of any such
Hazardous Substance on the Demised Premises provided, however, that
Lessee shall first obtain Lessor's written approval for any such remedial
action.
(b) As used herein, "Hazardous Substance" means any substance
which is toxic, ignitable, reactive, corrosive, and which is regulated by
any local government, the State of Connecticut, or the United States
Government. "Hazardous Substance" also includes any and all material or
substances which are defined as "hazardous waste," "extremely hazardous
waste," or a "hazardous substances," pursuant to state, federal, or local
governmental law. "Hazardous Substance" also includes but is not
restricted to asbestos, polychlorinated biphenyls ("PCBs"), and oil,
petroleum products and their by-products.
(c) Lessee shall use reasonable efforts to prevent unnecessary
noise or vibrations from carrying outside the Demised Premises and to
prevent the omission of any detrimental or obnoxious fumes or smells.
Brokerage
38. Lessor and Lessee each warrant and covenant with the other that
neither has retained or contracted with any realtor or real estate broker
with regard to this lease. However, CB Commercial is Lessor's broker.
Signage
39. Lessee may install a freestanding sign subject to applicable
governmental laws or regulations.
IN WITNESS WHEREOF, the parties hereto have hereunto set their
respective hands and seals on the day and year first above written.
Signed and sealed in the LESSOR:
presence of: PEARSON-ENFIELD DEVELOPMENT
COMPANY LLC
/s/Joeseph Korecki By: Thomas J. Henshon
- ----------------------------- -----------------------------
Thomas J. Henshon
Manager
LESSEE:
SIMPSON STRONG-TIE COMPANY, INC.
November 10, 1997 By: /S/Steve Lamson
- ----------------------------- -----------------------------
Name: STEVE LAMSON
Title: CFO
COMMONWEALTH OF MASSACHUSETTS
Hampden, ss November 18, 1997
Then personally appeared the above-named THOMAS J. HENSHON, Manager
of Pearson-Enfield Development Company LLC, Lessor, and acknowledged the
foregoing instrument to be the free act and deed of said Lessor, before
me,
/s/signature not legible
------------------------------
Notary Public
My commission expires: 3/11/98
STATE OF CALIFORNIA
County of Alameda November 10, 1997
Then personally appeared the above-named STEVE LAMSON, the CFO of
Simpson Strong-Tie Company, Inc., Lessee, and acknowledged the foregoing
instrument to be the free act and deed of the Lessee, before me,
/s/Kathleen M. Kuwitzky
-------------------------------
Notary Public
My commission expires: 5/4/2001
EXHIBIT A - DRAWINGS OF PREMISIS
LEASE GUARANTY
SIMPSON MANUFACTURING CO., INC., a California Corporation, having a
principal place of business at Pleasanton, California 94588, in order to
induce PEARSON-ENFIELD DEVELOPMENT COMPANY LLC, ("Lessor") as Lessor, to
execute certain lease with SIMPSON STRONG-TIE COMPANY INC. ("Lessee") as
Lessee, for certain premises located in Lessor's Building at 7 Pearson
Way, Enfield, Connecticut, which as a result of this inducement Lessor
has executed said Lease to which this Lease Guaranty is attached, and in
further consideration of One Dollar and other valuable consideration to
us paid by Lessor, the receipt whereof we hereby acknowledge, we do
hereby unconditionally guaranty to Lessor (which term shall include its
successors and assigns where the context so requires and admits) the
punctual payment of rent by Lessee and the performance and observance by
Lessee of all the other terms, covenants and conditions of the said Lease
to be performed or observed by the Lessee thereunder.
And for further consideration aforesaid, we do hereby agree that
this Guaranty shall be absolute, unconditional and irrevocable and that
without in any way exonerating the guaranty hereunder or releasing or
affecting the liability of guaranty hereunder, Lessor may grant at any
time or times any extension of time or other indulgence to or compound
with Lessee, including, but without limiting the generality of the
foregoing, any variation, modification or waiver of any term, covenant or
condition of said Lease or may take any note, obligation, security or
other guaranty as further security for said Lease and Lessor may take any
action or lack of action without our consent hereunder and without notice
to us; and we do hereby waive notice of any and every kind whatsoever
hereunder, and particularly, but without limiting the generality of the
foregoing, do hereby waive notice of breach or default of any of the
terms, covenants and conditions of said Lease. This guaranty shall
continue in full force and effect notwithstanding any assignment of said
Lease by Lessee, whether or not approved by Lessor. This guaranty shall
be binding upon each of the undersigned and its successors and assigns.
IN WITNESS WEREOF, the undersigned, by STEVE LAMSON, its CFO, duly
authorized has set its hand and seal hereto, on this 23 day of December,
1997.
SIMPSON MANUFACTURING CO., INC.
By: /s/Steve Lamson
-----------------------------
Name: Steve Lamson
Title: CFO
Attest: /s/Steve Lamson
-----------------------------
Name: Steve Lamson
Secretary
STATE OF CALIFORNIA
County of Alameda December 23, 1997
Then personally appeared the above-named STEVE LAMSON, the CFO of
Simpson Manufacturing Co., Inc., Guarantor, and acknowledged the
foregoing instrument to be the free act and deed of the Lessee, before
me,
/s/Kathleen M. Kuwitzky
-------------------------------
Notary Public
My commission expires: 5/4/2001
ADDENDUM I TO LEASE
REFERENCE is made to the Lease between Pearson-Enfield Development
Company LLC, as Lessor, and Simpson Strong-Tie Company, Inc., as Lessee.
This Addendum is being executed contemporaneously with said Lease and is
intended to be a part thereof.
1. Lessee shall have the option to lease an additional 51,004
square feet to be attached to the building which is being constructed
pursuant to the Lease, and being a portion of the Lessor's Land
(hereinafter the "Additional Building Space"), located at 7 Pearson Way,
Enfield, Connecticut. Said option shall be exercisable at any time
during the original term of this Lease.
2. It is contemplated by the parties that the Additional Building
Space, as will be constructed, will be substantially similar to the
original building (except that it will not contain any additional office
space; and additional truck docks, if any, to be determined).
3. The Annual Minimum Base Rent payable by the Lessee for the
Additional Building Space will be mutually determined by the parties
based on the then prevailing rent rates for comparable new construction
in the Enfield area and with a new lease term for both the Demised
Premises and Additional Building Space based on a reasonable term of
years to justify Lessor's cost of such new construction. The parties
agree to negotiate such rent rate and lease term in a reasonable good
faith manner.
Except as stated herein, all of the other terms, covenants and
provisions of the Lease shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have set their respective hands and
seals on the day first above-mentioned.
Signed and sealed in the PEARSON-ENFIELD DEVELOPMENT
presence of: COMPANY LLC, as Lessor
/s/Joeseph Korecki By: Thomas J. Henshon
- ----------------------------- -----------------------------
Thomas J. Henshon
Its Manager
LESSEE:
SIMPSON STRONG-TIE COMPANY, INC.
November 10, 1997 By: /S/Steve Lamson
- ----------------------------- -----------------------------
Name: STEVE LAMSON
Title: CFO
Duly authorized
COMMONWEALTH OF MASSACHUSETTS
Hampden, ss November 18, 1997
Then personally appeared the above-named THOMAS J. HENSHON, as
Manager of Pearson-Enfield Development Company LLC, Lessor, and
acknowledged the foregoing instrument to be the free act and deed of said
Lessor, before me,
/s/signature not legible
------------------------------
Notary Public
My commission expires: 3/11/98
STATE OF CALIFORNIA
County of Alameda November 10, 1997
Then personally appeared the above-named STEVE LAMSON, the CFO of
Simpson Strong-Tie Company, Inc., Lessee, and acknowledged the foregoing
instrument to be the free act and deed of the Lessee, before me,
/s/Kathleen M. Kuwitzky
-------------------------------
Notary Public
My commission expires: 5/4/2001