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EXHIBIT 10.9
COMMERCIAL LEASE AGREEMENT
BETWEEN
AMERICAN INDUSTRIAL PROPERTIES REIT, as Landlord
AND
CIRRUS LOGIC, INC., as Tenant
Dated: September 15, 1999
COMMERCIAL LEASE AGREEMENT PAGE 1
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TABLE OF CONTENTS
ARTICLE 1 - BASIC LEASE PROVISIONS 3
ARTICLE 2 - TERM AND POSSESSION 4
ARTICLE 3 - RENT 6
ARTICLE 4 - SECURITY DEPOSIT 8
ARTICLE 5 - OCCUPANCY AND USE 8
ARTICLE 6 - UTILITIES AND SERVICES 10
ARTICLE 7 - MAINTENANCE, REPAIRS, ALTERATIONS AND IMPROVEMENTS 11
ARTICLE 8 - INSURANCE, FIRE AND CASUALTY 13
ARTICLE 9 - CONDEMNATION 16
ARTICLE 10 - LIENS 16
ARTICLE 11 - TAXES ON TENANT'S PROPERTY 17
ARTICLE 12 - SUBLETTING AND ASSIGNING 17
ARTICLE 13 - SUBORDINATION AND TENANT'S ESTOPPEL CERTIFICATE 18
ARTICLE 14 - DEFAULT 19
ARTICLE 15 - NOTICES 22
ARTICLE 16 - MISCELLANEOUS PROVISIONS 22
EXHIBITS AND RIDERS
Exhibit A Site Plan of Premises
Exhibit B Acceptance of Premises Memorandum
Exhibit C Rules and Regulations
Exhibit D Work Letter
Addendum Y Check, if applicable
Rider 1 Renewal Option
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COMMERCIAL LEASE AGREEMENT
This Commercial Lease Agreement (hereinafter called this "Lease") is made this
15th day of September, 1999 between AMERICAN INDUSTRIAL PROPERTIES REIT,
(hereinafter called "Landlord"), and CIRRUS LOGIC, INC., a Delaware corporation
(hereinafter called "Tenant").
ARTICLE 1
BASIC LEASE PROVISIONS AND DEFINITIONS
1. Building:
a. Name: South East Commercial Center
Address: 4120 Commercial Center Dr. Austin, Texas 78760
b. Intentionally Omitted
c. Agreed Rentable Area: 34,514 square feet.
2. Premises:
a. Suite #: 400
b. Agreed Rentable Area: 18,056 square feet.
3. Term: Twenty-four months and fifteen days.
4. Commencement Date: September 15, 1999.
5. Expiration Date: September 30, 2001.
6. Base Rent:
RENTAL PERIOD
Commencement Date to September 30, 2000 $0.63 per square foot per month, or $11,375.28 per month
October 1, 2000 to September 30, 2001 $0.68 per square foot per month or $12,278.08 per month
7. Additional Rent -- Operating Expenses and Taxes:
Tenant shall pay its pro rata share, which is defined as 52.32%, of
Operating Expenses and Real Estate Taxes. For the initial term of this
Lease, Operating Expenses, excluding management fees and insurance, shall
not exceed $1.44 per square foot annually. Tenant shall pay as separate line
items (1) management fees which shall not exceed 3% (three percent) of Rent
(as defined below), (2) Building utilities, and (3) Building insurance for
each of the latter of which Tenant shall pay its Pro Rata Share in full.
Real Estate Taxes shall not be limited and Tenant shall pay in full its Pro
Rata Share of all Real Estate Taxes due.
The following chart is provided as an estimate of Tenant's initial monthly
payment broken down into its components. This chart, however, does not supersede
the specific provisions contained elsewhere in this Lease.
Initial Monthly Base Rent $ 11,375.28
Initial Monthly Estimated Operating Expense Escrow $ 2,166.72
Initial Monthly Estimated Management Fees $ 541.68
Initial Monthly Estimated Building Insurance $ 150.47
Initial Monthly Estimated Real Estate Tax Escrow $ 2,166.72
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Total Initial Monthly Payment $ 16,400.87
8. Security Deposit: $-0-.
9. Permitted Use: Administrative offices, warehouse, and storage.
10. Landlord's Broker: USAA Realty Company.
Landlord's Broker is represented by: Paul C. Joseph, Jr.
11. Tenant's Broker: NIA/Commercial Industrial Properties
Tenant's Broker is represented by: Royce Lacey and Alan K. Lacey.
12. Payments: All payments shall be sent to Landlord in care of USAA Realty
Company, ("Property Manager") at the address below, or such other place as
Landlord may designate from time to time.
13. (Intentionally Deleted)
14. Notices: Addresses for notices due under this Lease:
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LANDLORD
c/o American Industrial Properties REIT
6210 North Beltline, Suite 170
Irving, TX 75063-2656
Attention: Mr. Joe Akers
Office: (972) 756-6000
Fax: (972) 756-0704
Senior Property Manager:
Paula Boyd
USAA Realty Company
11044 Research Blvd.
Bldg. A, Suite A-200
Office: (512) 346-5232
Fax: (512) 345-1028
TENANT
Cirrus Logic, Inc.
3100 W. Warren Avenue, MS510
Fremont, CA 94538
Attention: Patricia Clark
Office: (510) 624-7164
Fax: (510) 624-7290
ARTICLE 2
TERM AND POSSESSION
SECTION 2.1 LEASE OF PREMISES, COMMENCEMENT AND EXPIRATION:
2.1.1 Lease of Premises: In consideration of the mutual covenants
herein, Landlord hereby leases to Tenant and Tenant hereby leases from Landlord,
subject to all the terms and conditions of this Lease, the portion of the
Building (as described in Item 1 of Article 1) described as the Premises in Item
2 of Article 1 and that is more particularly described by the crosshatched area
on Exhibit A attached hereto (hereinafter called the "Premises"). The agreed
rentable area of the Premises is hereby stipulated to be the "Agreed Rentable
Area" of the Premises set forth in Item 2b of Article 1, irrespective of whether
the same should be more or less. The agreed rentable area of the Building is
hereby stipulated to be the "Agreed Rentable Area" of the Building set forth in
Item 1c of Article 1, irrespective of whether the same should be more or less.
The Building, the land on which the Building is situated and all improvements
and appurtenances to the Building and the land are referred to collectively
herein as the "Property".
2.1.2 Initial Term and Commencement: The initial term of this Lease
shall be the period of time specified in Item 3 of Article 1. The initial term
shall commence on the Commencement Date (herein so called) set forth in Item 4
of Article 1 and, unless sooner terminated pursuant to the terms of this Lease,
the initial term of this Lease shall expire, without notice to Tenant, on the
Expiration Date (herein so called) set forth in Item 5 of Article 1 (as such
Commencement Date and/or Expiration Date may be adjusted pursuant to Exhibit B
attached hereto). Notwithstanding anything to the contrary contained herein, the
Lease will expire in the last day of the last month of the Term.
SECTION 2.2 INSPECTION AND DELIVERY OF PREMISES, CONSTRUCTION OF LEASE SPACE
IMPROVEMENTS AND POSSESSION:
2.2.1 Delivery and Completion: TENANT HEREBY ACKNOWLEDGES THAT TENANT
HAS INSPECTED THE COMMON AREA (AS HEREINAFTER DEFINED) AND THE PREMISES, AND
HEREBY ACCEPTS THE COMMON AREA IN "AS IS" CONDITION FOR ALL PURPOSES.
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TENANT ALSO HEREBY ACCEPTS THE PREMISES FOR ALL PURPOSES (INCLUDING THE
SUITABILITY OF THE PREMISES FOR THE PERMITTED USE). Tenant will perform or cause
to be performed the work and/or construction of Tenant's Improvements (as
defined in the Work Letter attached hereto as Exhibit D) in accordance with the
terms of the Work Letter. The Premises shall be delivered to Tenant upon this
Lease being signed by all parties. Landlord will, permit the Tenant to have
access to the Premises prior to the Commencement Date. Any such occupancy will
not affect the Commencement Date; however, such occupancy will be subject to all
other provisions of this Lease, including without limitation the indemnity
provisions set forth in Section 8.5.1. hereof.
2.2.2 Common Area: "Common Areas" will mean all areas, spaces,
facilities, and equipment (whether or not located within the Building) made
available by Landlord for the common and joint use of Landlord, Tenant and
others designated by Landlord using or occupying space in the Building or at the
Property, as applicable, to the extent same are not expressly made a part of the
Premises, and are made available for use of all tenants in the Building. Tenant
is hereby granted a nonexclusive right to use the Common Areas during the term
of this Lease for its intended purposes, in common with others designated by
Landlord, subject to the terms and conditions of this Lease, including, without
limitation, the Rules and Regulations, as defined in Exhibit C. The Common Areas
will be at all times under the exclusive control, management and operation of
the Landlord.
2.2.3 Acceptance of Premises Memorandum: Tenant shall execute the
Acceptance of Premises Memorandum (herein so called) attached hereto as Exhibit
B simultaneous with the execution of this Lease. If Tenant occupies the Premises
without executing an Acceptance of Premises Memorandum, Tenant shall be deemed
to have accepted the Premises for all purposes.
SECTION 2.3 REDELIVERY OF THE PREMISES: Upon the expiration or earlier
termination of this Lease, or upon the exercise by Landlord of its right to
re-enter the Premises without terminating this Lease, Tenant shall immediately
deliver to Landlord the Premises in a safe, "broom clean", neat, sanitary and
operational condition, normal wear and tear excepted, together with all keys and
parking and access cards. Tenant shall, by the Expiration Date or, the date this
Lease is earlier terminated in accordance with the terms hereof, remove from the
Premises, at the sole expense of Tenant: (i) unless Landlord is asserting its
lien rights therein, any equipment, machinery, trade fixtures and personally
installed or placed in the Premises by or on behalf of Tenant and (ii) if
requested by Landlord, all or any part of the improvements made to the Premises
by or on behalf of Tenant except the improvements shown on Exhibit D and
improvements Landlord agreed to retain in accordance with Section 7.3.3. All
removals described above shall be accomplished in a good and workmanlike manner
so as not to damage the Premises or the primary structure or structural
qualities of the Building or the plumbing, electrical lines or other utilities.
Tenant shall, at its expense, promptly repair any damage caused by such removal,
provided that in the case of improvements that Tenant is required to remove,
Tenant shall restore the Premises to the condition existing prior to the
installation of such improvements. If Tenant fails to deliver the Premises in
the condition aforesaid, then Landlord may restore the Premises to such a
condition at Tenant's expense. All property required to be removed pursuant to
this Section not removed within time period required hereunder shall thereupon
be conclusively presumed to have been abandoned by Tenant and Landlord may, at
its option, take over possession of such property and either (a) declare the
same to be the property of Landlord or (b) at the sole cost and expense of
Tenant, remove and store and/or dispose of the same or any part thereof in any
manner that Landlord shall choose without incurring liability to Tenant or any
other person.
SECTION 2.4 HOLDING OVER: In the event Tenant, or any party under Tenant
claiming rights to this Lease, retains possession of the Premises after the
expiration or earlier termination of this Lease, such possession shall
constitute and be construed as a tenancy at will only, subject however, to all
of the terms, provisions, covenants and agreements on the part of Tenant
hereunder; such parties shall be subject to immediate eviction and removal, and
Tenant or any such party covenants and agrees to pay Landlord as rent for the
period of such holdover an amount equal to 1.50 times the Base Rent and
Additional Rent (as hereinafter defined) in effect immediately preceding
expiration or termination, as applicable, prorated on a daily basis. Tenant
covenants and agrees to also pay any and all damages sustained by Landlord as a
result of such holdover not approved by Landlord. The rent during such holdover
period shall be payable to Landlord from time to time on demand; provided,
however, if no demand is made during a particular month, holdover rent accruing
during such month shall be paid in accordance with the provisions of Section
3.1.
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Tenant will vacate the Premises and deliver same to Landlord immediately upon
Tenant's receipt of notice from Landlord to so vacate. No holding over by
Tenant, whether with or without consent of Landlord, shall operate to extend the
term of this Lease. No payments of money by Tenant to Landlord after the
expiration or earlier termination of this Lease shall reinstate, continue or
extend the term of this Lease. No payments of money by Tenant, other than the
holdover rent accruing during such holdover period paid in accordance with the
provisions of this Section 2.4, to Landlord after the expiration or earlier
termination of this Lease shall constitute full payment of rent under the terms
of this Lease. Tenant further agrees that any such payment(s) of the Base Rent
and Additional Rents at an amount less than the holdover rent accruing in
accordance with the provisions of this Section 2.4, to Landlord shall constitute
a default and breach of this Lease by Tenant pursuant to Article 14 herein. No
extension of this Lease after the expiration or earlier termination thereof
shall be valid unless and until the same shall be evidenced by a writing signed
by both Landlord and Tenant.
ARTICLE 3
RENT
SECTION 3.1 BASE RENT: Tenant shall pay as rent for the Premises the applicable
Base Rent shown in Item 6 of Article 1. The Base Rent shall be payable in
monthly installments equal to the applicable Base Rent shown in Item 6 of
Article 1 in advance, without notice, demand, offset or deduction. The required
monthly installments shall commence on the Commencement Date and shall continue
on the first (1st) day of each calendar month thereafter until the Expiration
Date. Payments made within five (5) days of the due date will be deemed timely.
If the Commencement Date is specified to occur or otherwise occurs on a day
other than the first day of a calendar month, the Base Rent for such partial
month shall be prorated.
SECTION 3.2 ADDITIONAL RENT:
3.2.1 Definitions: For purposes of this Lease, the following
definitions shall apply:
(a) "Additional Rent", for a particular year, shall equal the product of
Tenant's Pro Rata Share Percentage (as set forth in Item 7 of Article 1),
multiplied by the sum of all Operating Expenses for the applicable calendar
year plus the Real Estate Taxes for the applicable calendar year.
(b) "Operating Expenses" shall mean (without duplication of any costs and
expenses of which Tenant is responsible under Section 6.1 or subsection
7.2.1 below) (i) all of the costs and expenses Landlord incurs, pays or
becomes obligated to pay in connection with operating, managing,
maintaining, repairing and insuring the Property for a particular calendar
year or portion thereof as determined by Landlord in accordance with
generally accepted accounting practices, (ii) wages, salaries, employee
benefits and taxes for personnel working full or part-time in connection
with the operation, maintenance and management of the Building and the
Common Areas, (iii) the cost of any capital improvement made to the
Building by Landlord after the date of this Lease that is required under
any governmental law or regulation, together with an amount equal to
interest at the rate of ten percent (10%) per annum (the "Amortization
Rate") on the unamortized balance thereof, (iv) the cost of any capital
improvement made to the Common Areas of the Building after the date of this
Lease that is required under the interpretations or regulations issued from
time to time under the provisions of the Americans With Disabilities Act of
1990, 42 U.S.C. Section 120101-12213 or comparable laws of the State and
local agencies in which the Property is located (collectively, the
"Disability Acts"), amortized over such period as Landlord shall reasonably
determine, together with an amount equal to interest at the Amortization
Rate on the unamortized balance thereof, (v) the cost of any labor-saving
or energy-saving device or other equipment installed in the Building after
the date hereof, only to the extent that it equals the savings to Tenant in
a given year, amortized over such period as is reasonably determined by
Landlord, together with an amount equal to interest at the Amortization
Rate on the unamortized balance thereof, and (vi) the charges assessed
against the Property pursuant to any contractual covenants or recorded
declaration of covenants or the covenants, conditions and restrictions of
any other similar instrument affecting the Property. Operating Expenses
shall not include Real Estate Taxes (hereinafter defined).
(c) "Real Estate Taxes" shall mean all real estate taxes and other taxes or
assessments, which are levied with respect to the Property or any portion
thereof for each calendar year and shall include any tax,
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surcharge or assessment which shall be levied in addition to or in lieu of
real estate taxes, the costs and expenses of a consultant, if any, and/or
of contesting the validity or amount of such real estate or other taxes,
and shall also include any rental, excise, sales, transaction, privileged,
or other tax or levy, however denominated, imposed upon or measured by the
rental payable hereunder or on Landlord's business of leasing the Premises,
any non-progressive tax on or measured by gross rentals received from the
rental of space in the Building, and any tax in this transaction or any
documents to which Tenant is a party creating or transferring an interest
in the Premises, excepting only Landlord's net income taxes (collectively,
"Real Estate Taxes").
3.2.2 Payment Obligation: In addition to the Base Rent specified in
this Lease, Tenant shall pay to Landlord the Additional Rent, in each calendar
year or partial calendar year, payable in monthly installments as hereinafter
provided. On or prior to the Commencement Date and at least thirty (30) days
prior to each calendar year thereafter (or as soon thereafter as is reasonably
possible), Landlord shall give Tenant written notice of Tenant's estimated
Additional Rent for the applicable calendar year and the amount of the monthly
installment due for each month during such year. Tenant shall pay to Landlord on
the Commencement Date and on the first day of each month thereafter the amount
of the applicable monthly installment, without notice, demand, offset or
deduction, provided, however, if the applicable installment covers a partial
month, then such installment shall be prorated on a daily basis. If Landlord
fails to give Tenant notice of its estimated payments of Additional Rent in
accordance with this subsection for any calendar year, then Tenant shall
continue making monthly estimated payments in accordance with the estimate for
the previous calendar year until a new estimate is provided by Landlord. If
Landlord determines that, because of unexpected increases in Operating Expenses
or other reasons, Landlord's estimate of Operating Expenses was too low, then
Landlord shall have the right to give a new statement of the estimated
Additional Rent due from Tenant for the applicable calendar year or the balance
thereof and to bill Tenant for any deficiency which may have accrued during such
calendar year or portion thereof, and Tenant shall thereafter pay monthly
installments of Additional Rent based on such new statement. Within ninety (90)
days after the expiration of each calendar year, and of the Expiration Date or
as soon thereafter as is practicable, Landlord shall prepare and deliver to
Tenant a statement showing Tenant's actual Additional Rent for the applicable
calendar year, provided that with respect to the calendar year in which the
Expiration Date occurs, (x) that calendar year shall be deemed to have commenced
on January 1 of that year and ended on the Expiration Date (the "Final Calendar
Year") and (y) Landlord shall have the right to estimate the actual Operating
Expenses allocable to the Final Calendar Year. If Tenant's total monthly
payments of Additional Rent for the applicable calendar year are less than
Tenant's actual Additional Rent, then Landlord shall credit the amount of such
overpayment to Tenant, provided, however, with respect to the Final Calendar
Year, Landlord shall pay to Tenant the amount of such excess payments, less any
additional amounts then owed to Landlord. Unless Tenant takes written exception
to any item within three (3) months after the furnishing of an annual statement,
such statement shall be considered as final and accepted by Tenant. Any amount
due Landlord as shown on any such statement shall be paid by Tenant within
twenty (20) days after it is furnished to Tenant.
SECTION 3.3 RENT DEFINED AND NO OFFSETS: The Base Rent, the Additional Rent
and all other sums required to be paid to Landlord by Tenant under this Lease,
including any sums due under the Work Letter, shall constitute rent and are
sometimes collectively referred to as "Rent". Tenant shall pay each payment of
Rent when due, without prior notice or demand therefor and without deduction or
offset.
SECTION 3.4 LATE CHARGES: If any installment of Base Monthly Rent or Additional
Rent or any other payment of Rent under this Lease shall not be paid within five
(5) days of when due, a "Late Charge" of five percent (5%) of the amount overdue
may be charged by Landlord to defray Landlord's administrative expense incident
to the handling of such overdue payments. Each Late Charge shall be payable by
Tenant on demand of Landlord. Landlord shall waive the Late Charges two (2)
times during the term of the Lease and provide Tenant with written notice and
five (5) days to cure for the two (2) times Landlord waives the Late Charge.
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ARTICLE 4
SECURITY DEPOSIT
[This Section intentionally deleted]
ARTICLE 5
OCCUPANCY AND USE
SECTION 5.1 USE OF PREMISES:
5.1.1 General: The Premises shall, subject to the remaining provisions
of this Section, be used solely for the purpose specified in Item 9 of Article
1. Prior to commencement of any work pursuant to the Work Letter (or if no work
is to be performed pursuant to a Work Letter, then prior to Tenant's occupancy
of the Premises), Tenant shall satisfy itself and Landlord that the Permitted
Use will comply with all applicable zoning ordinances, rules and regulations.
Without in any way limiting the foregoing, Tenant shall not use any part of the
Premises for sleeping quarters, or for the generation of hazardous or toxic
chemical or materials, and will not use, occupy or permit the use or occupancy
of the Premises for any purpose which is forbidden by or in violation of any
zoning ordinance, law, rule or regulation or any other law, ordinance, or
governmental or municipal regulation, order, or certificate of occupancy, or
which may be dangerous to life, limb or property; or permit the maintenance of
any public or private nuisance; or do or permit any other thing which may
disturb the quiet enjoyment of any other tenant of the Building; or keep any
substance or carry on or permit any operation which might emit offensive odors
or conditions from the Premises; or commit, suffer or permit any waste in or
upon the Premises, or at any time sell, purchase or give away or permit the
sale, purchase or gift of food in any form by or to any of Tenant's agents or
employees or other parties in the Premises except through vending machines in
employees' lunch or rest areas within the Premises for use by Tenant's employees
only; or use an apparatus which might make undue noise or set up vibrations in
the Building; or permit anything to be done which would increase the fire and
extended coverage insurance rate on the Building or contents, and if there is
any increase in such rate by reason of acts of Tenant, then Tenant agrees to pay
such increase upon demand therefor by Landlord. Payment by Tenant of any such
rate increase shall not be a waiver of Tenant's duty to comply herewith. TENANT
SHALL INDEMNIFY AND HOLD LANDLORD HARMLESS FROM ANY AND ALL COSTS, EXPENSES
(INCLUDING REASONABLE ATTORNEYS' FEES), CLAIMS AND CAUSES OF ACTION ARISING FROM
TENANT'S FAILURE TO COMPLY WITH THIS SECTION. Outside storage, including without
limitation, storage in non-operative or stationary trucks, trailers and other
vehicles, and vehicle maintenance or repair is prohibited without Landlord's
prior written consent. Tenant shall keep the Premises neat and clean at all
times. Tenant shall promptly correct any violation of a governmental law, rule
or regulation with respect to the Premises. Tenant shall comply with any
direction of any governmental authority having jurisdiction which imposes any
duty upon Tenant or Landlord with respect to the Premises, or with respect to
the occupancy or use thereof and shall comply with all matters of record
affecting the Premises which may impose additional restrictions and/or
obligations on the Landlord or the Tenant.
5.1.2 Hazardous and Toxic Materials:
(a) Tenant shall not incorporate into, use, or otherwise place or dispose
of at the Premises or in the Building or the Property any hazardous or
toxic materials except for use and storage of cleaning and office supplies
used in the ordinary course of Tenant's business and then only if (i) such
materials are in small quantities, properly labeled and contained, (ii)
such materials are handled and disposed of in accordance with the highest
accepted industry standards for safety, storage, use and disposal, (iii)
notice of and a copy of the current material safety data sheet is promptly
delivered to Landlord for each such hazardous or toxic material and (iv)
such materials are used, transported, stored, handled and disposed of in
accordance with all applicable governmental laws, rules and regulations.
Landlord shall have the right to periodically inspect, take samples for
testing and otherwise investigate the Premises for the presence of
hazardous or toxic materials. Landlord shall not knowingly dispose of at
the Premises, in the Building or the Property any hazardous or toxic
materials and shall otherwise deal with all hazardous or toxic materials at
the Premises, Building or Property in a manner that will not materially and
adversely affect Tenant's access, use or occupancy of the Premises. If
Landlord or Tenant ever has knowledge of the presence in the Premises or
the Building or the Property of hazardous or toxic materials which affect
the Premises, the party having knowledge shall notify the other party
thereof in writing promptly after obtaining such knowledge. For purposes of
this Lease, hazardous or toxic
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materials shall mean asbestos containing materials ("ACM") and all other
materials, substances, wastes and chemicals classified as hazardous or
toxic substances, materials, wastes or chemicals under then-current
applicable governmental laws, rules or regulations or that are subject to
any right-to-know laws or requirements.
(b) Prior to commencement of any tenant finish work to be performed by
Landlord, Tenant shall have the right to make such studies and
investigations and conduct such tests and surveys of the Premises from an
environmental standpoint as Tenant deems necessary or appropriate, subject
to the conditions that all such studies and investigations shall be
completed prior to the commencement of any tenant finish work to be
performed by landlord. TENANT SHALL RESTORE THE PREMISES AND HOLD LANDLORD
HARMLESS FROM AND INDEMNIFY LANDLORD AGAINST ALL LOSS, DAMAGES, AND CLAIMS
RESULTING FROM OR RELATING TO TENANT'S STUDIES, TESTS AND INVESTIGATIONS.
If such study, test, investigation or survey evidences hazardous or toxic
materials which affect the Premises, Tenant shall have the right to
terminate this Lease provided such right shall be exercised, if at all,
prior to the commencement of any tenant finish work to be performed by
Landlord and within five (5) days after Tenant receives the evidence of
hazardous or toxic materials or if Tenant takes occupancy of the Premises
prior to exercising such right, Tenant's right to terminate this Lease
shall be null and void and of no further force and effect.
(c) If Tenant or its employees, agents, contractors, invitees, or visitors
shall ever violate the provisions of paragraph (a) of this subsection 5.1.2
or otherwise contaminate the Premises or the Property, then Tenant shall
clean up, remove and dispose of the material causing the violation, in
compliance with all applicable governmental standards, laws, rules and
regulations and then prevalent industry practice and standards and shall
repair any damage to the Premises or the Building or the Property within
such period of time as may be reasonable under the circumstances after
written notice by Landlord. Tenant shall notify Landlord of its method,
time and procedure for any clean up or removal and Landlord shall have the
right to require reasonable changes in such method, time or procedure or to
require the same to be done after normal business hours. Tenant's
obligations under this subsection 5.1.2(c) shall survive the termination of
this Lease. Tenant represents to Landlord that, except as has been
disclosed to Landlord in writing, Tenant has never been cited for or
convicted of any hazardous or toxic materials violations under applicable
laws, rules or regulations.
(d) TENANT AGREES TO DEFEND, INDEMNIFY AND HOLD HARMLESS THE LANDLORD FROM
AND AGAINST ALL OBLIGATIONS (INCLUDING REMOVAL AND REMEDIAL ACTIONS),
LOSSES, CLAIMS, SUITS, JUDGMENTS, LIABILITIES, PENALTIES, DAMAGES
(INCLUDING CONSEQUENTIAL AND PUNITIVE DAMAGES), COSTS AND EXPENSES
(INCLUDING ATTORNEYS' AND CONSULTANTS' FEES AND EXPENSES) OF ANY KIND OR
NATURE ("COLLECTIVELY, "CLAIMS") WHATSOEVER THAT MAY AT ANY TIME BE
INCURRED BY, IMPOSED ON OR ASSERTED AGAINST SUCH INDEMNITIES DIRECTLY OR
INDIRECTLY BASED ON, OR ARISING OR RESULTING FROM (a) THE ACTUAL OR ALLEGED
PRESENCE OF HAZARDOUS OR TOXIC MATERIALS ON THE PREMISES WHICH IS CAUSED OR
PERMITTED BY TENANT, AND (b) ANY CLAIM OR CAUSE OF ACTION RELATING IN ANY
WAY TO TENANT'S OPERATION OR USE OF THE PREMISES. TENANT WILL BE RELIEVED
OF THE FOREGOING INDEMNIFICATION OBLIGATIONS UNLESS LANDLORD (I) NOTIFIES
TENANT PROMPTLY IN WRITING OF SUCH CLAIM; (II) ALLOWS TENANT TO CONTROL THE
DEFENSE AND SETTLEMENT OF ANY SUCH CLAIM; AND (III) GIVES TENANT
INFORMATION AND ASSISTANCE WITH ANY SUCH CLAIM, AT TENANT'S EXPENSE. THE
PROVISIONS OF THIS SECTION 5.1.2(D) SHALL SURVIVE THE EXPIRATION OR SOONER
TERMINATION OF THIS LEASE. If Landlord notifies Tenant of any claim,
demand, action, administrative or legal proceeding, investigation or
allegations as to which the indemnity provided for in this Section 5.1.2(d)
applies (a "Potential Claim"), Tenant shall assume on behalf of Landlord,
and conduct with due diligence and in good faith, the investigation and
defense thereof and the response thereto with counsel reasonably
satisfactory to Landlord; provided that Tenant shall have the right to cure
such matter that is the subject of the Potential Claim if such cure will
not result in additional liability or loss of rights to Landlord. In the
event that any such Potential Claim involves both Tenant and Landlord, and
Landlord shall have reasonably concluded that there may be a
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legal defense available to it which is inconsistent with or in addition to
those available to Tenant, then Landlord shall have the right to select
separate counsel to participate in the investigation and defense of and
response to such Potential Claim on its own behalf at Tenant's expense;
provided that Landlord promptly notifies Tenant in writing of the reasons
for Landlord's need for separate counsel.
SECTION 5.2 RULES AND REGULATIONS: Tenant will comply with such rules and
regulations (the "Rules and Regulations") generally applying to tenants in the
Building as may be adopted from time to time by Landlord for the management,
cleanliness of, and the preservation of good order and protection of property
in, the premises and the Building and the Property. A current copy of the Rules
and Regulations applicable to the Building is attached hereto as Exhibit C. All
such Rules and Regulations are hereby made a part hereof. All changes and
amendments to the Rules and Regulations sent by Landlord to Tenant in writing
and conforming to the foregoing standards shall be carried out and observed by
Tenant. Landlord hereby reserves all rights necessary to implement and enforce
the Rules and Regulations and each and every provision of this Lease.
SECTION 5.3 ACCESS; RIGHT OF ENTRY: Without being deemed or construed as
committing an actual or constructive eviction of Tenant and without abatement of
Rent, Landlord or its authorized agents shall have the right to enter the
Premises, upon reasonable notice (except in emergency situations where no prior
notice is required), to inspect the Premises, to show the Premises to
prospective lenders, purchasers or tenants and to fulfill Landlord's obligations
or exercise its rights under this Lease; provided, however, no notice shall be
required to inspect or show the Premises within the six (6) month period prior
to expiration of this Lease. However, Landlord or its authorized agents shall be
escorted by an employee of Tenant. Tenant hereby waives any claim for damages
for any injury or inconvenience or interference with Tenant's business, any loss
of occupancy or quiet enjoyment of the Premises, and any other loss occasioned
thereby. Landlord shall have the right to use any and all means which Landlord
may deem proper to enter the Premises in an emergency without liability
therefor.
SECTION 5.4 QUIET POSSESSION: Provided Tenant timely pays Rent and observes and
performs all of the covenants, conditions and provisions on Tenant's part to be
observed and performed hereunder, Tenant shall have the quiet possession of the
Premises until the Expiration Date, subject to all of the provisions of this
Lease and all laws, encumbrances, liens and restrictive covenants to which the
Property is subject.
ARTICLE 6
UTILITIES AND SERVICES
SECTION 6.1 UTILITIES: Except for Landlord's obligation under the last two
sentences of this Section 6.1, Tenant shall be responsible for providing all
utilities to the Premises. Without limiting the foregoing, Tenant shall heat the
Premises as necessary to prevent any freeze damage to the Premises or any
portion thereof. Tenant shall directly pay for all utilities used on the
Premises which are separately metered, and reimburse Landlord for sub-metered
utilities (if any) together with any maintenance charges for utilities. The cost
of any utilities which are not separately metered or sub-metered to the Premises
shall be an Operating Expense and charged to Tenant in accordance with Article
3. Tenant's use of electric current shall at no time exceed the capacity of the
feeders or lines to the Building or the risers or wiring installation of the
Building or the Premises. Landlord shall in no event be liable for any
interruption or failure of, and Tenant shall not be entitled to any abatement or
reduction of Rent by reason of, any interruption or failure of utilities or
other services to the Premises, nor shall any such interruption or failure in
any such utility or service be construed as an eviction (constructive or actual)
of Tenant or as a breach of the implied warranty of suitability, or relieve
Tenant from the obligation to perform any covenant or agreement herein, and in
no event shall Landlord be liable for damage to persons or property (including,
without limitation, business interruption), or in default hereunder, as a result
of any such interruption or failure. However, if any such interruption is caused
by a break or other damage to any utility lines located on the Property and
outside of the Building that are under the exclusive control of Landlord, upon
receipt of written notice of such interruption Landlord shall use reasonable
efforts to perform or cause to be performed the necessary repairs within such
time frame as may be reasonable under the circumstances in order to restore the
affected service to the Premises. In addition, if any such interruption is
caused by a break or other damage to any utility line
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located on the Property and controlled by a governmental, private or public
utility, Landlord will cooperate with such utility so that the interrupted
service is restored to the Premises as soon as is reasonably possible.
SECTION 6.2 SERVICES: Landlord shall be under no obligation to provide any
services to the Building or Premises, except that Landlord shall provide routine
maintenance and cleaning in the Common Areas and utility service lines and
hookups to the Building, landscaping and parking lot maintenance.
ARTICLE 7
MAINTENANCE, REPAIRS, ALTERATIONS AND IMPROVEMENTS
SECTION 7.1 LANDLORD'S OBLIGATION TO MAINTAIN AND REPAIR; Landlord shall
(subject to Section 8.1, Section 8.4, Article 9 and Landlord's rights under
Section 3.2, and except for ordinary wear and tear) maintain load bearing walls
and foundation and repair or replace the roof of the Building when necessary
(with the cost of roof repairs an Operating Expense, and charged to Tenant
pursuant to Section 3.2.1.(b)). Except for maintaining the structural soundness
of the load bearing walls and foundation of the Building in which the Premises
are located, Landlord shall not be required to maintain or repair any other
portion of the Premises.
SECTION 7.2 TENANT'S OBLIGATIONS TO MAINTAIN AND REPAIR:
7.2.1 Tenant's Obligation: Subject to Sections 7.1, 8.1 and 8.4 and
Article 9, Tenant shall, at Tenant's sole cost and expense, and with Landlord's
supervision, repair and, as appropriate, replace any damage or injury done to
the Premises caused by Tenant, Tenant's agents, employees, licensees, invitees
or visitors and shall otherwise keep and maintain in good condition, appearance
and repair (including replacements), the Premises, which obligation shall
include, but not be limited to, the maintenance, repair and, as appropriate,
replacement of (a) all security, fire (including fire sprinkler), heating and
air conditioning systems and fixtures serving the Premises, (b) all plumbing,
sewage, mechanical and electrical systems and fixtures serving the Premises, (c)
all fixtures, walls, ceilings, floors, doors, overhead and dock loading doors,
windows, plate glass, skylights, lamps, fans and all other appliances and
equipment of every kind and nature located in, upon or about the Premises and
(d) the rail spur(s), if any, exclusively serving the Premises. TENANT SHALL
INDEMNIFY AND HOLD LANDLORD HARMLESS FROM ANY AND ALL COSTS, EXPENSES (INCLUDING
REASONABLE ATTORNEYS' FEES), CLAIMS AND CAUSES OF ACTION ("COLLECTIVELY,
"CLAIMS") ARISING FROM OR INCURRED BY AND/OR ASSERTED IN CONNECTION WITH ANY
SUCH MAINTENANCE, REPAIRS, REPLACEMENTS, DAMAGE OR INJURY OR TENANT'S BREACH OF
ITS OBLIGATIONS UNDER THIS SECTION 7.2 TENANT WILL BE RELIEVED OF THE FOREGOING
INDEMNIFICATION OBLIGATIONS UNLESS LANDLORD (1) NOTIFIES TENANT PROMPTLY IN
WRITING OF SUCH CLAIM; (II) ALLOWS TENANT TO CONTROL THE DEFENSE AND SETTLEMENT
OF ANY SUCH CLAIM; AND (III) GIVES TENANT INFORMATION AND ASSISTANCE WITH ANY
SUCH CLAIM, AT TENANT'S EXPENSE. If landlord notifies tenant of any claim,
demand, action, administrative or legal proceeding, investigation or allegations
as to which the indemnity provided for in this Section 7.2.1(d) applies (a
"Potential Claim"), Tenant shall assume on behalf of Landlord, and conduct with
due diligence and in good faith, the investigation and defense thereof and the
response thereto with counsel reasonably satisfactory to Landlord; provided that
Tenant shall have the right to cure such matter that is the subject of the
Potential Claim if such cure will not result in additional liability or loss of
rights to Landlord. In the event that any such Potential Claim involves both
Tenant and Landlord, and Landlord shall have reasonably concluded that there may
be a legal defense available to it which is inconsistent with or in addition to
those available to Tenant, then Landlord shall have the right to select separate
counsel to participate in the investigation and defense of and response to such
Potential Claim on its own behalf at Tenant's expense; provided that Landlord
promptly notifies Tenant in writing of the reasons for Landlord's need for
separate counsel. All repairs and replacements performed by or on behalf of
Tenant shall be performed in a good and workmanlike manner acceptable in all
aspects to Landlord, and in accordance with Landlord's standards applicable to
alterations or improvements performed by Tenant. Tenant shall continue to pay
Rent, without abatement, during any period that repairs or replacements are
performed or required to be performed by Tenant under this Section 7.2. Tenant
shall make no repairs to or penetrations of the roof of the Premises without
Landlord's consent.
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7.2.2 Rights of Landlord: Any maintenance, repairs or replacements to
be performed by Tenant under Section 7.2.1 above and any service which Tenant is
required to provide under Section 6.1 above may, upon written notice from
Landlord to Tenant, be performed by Landlord for Tenant's benefit, in which
event Tenant shall reimburse Landlord for all expenses and costs incurred by
Landlord in performing same plus an additional five percent (5%) of such amount
to compensate Landlord for Landlord's overhead and administrative costs relating
to such work. Landlord shall have the same rights with respect to repairs
performed by Tenant as Landlord has with respect to improvements and alterations
performed by Tenant under subsection 7.3.3. In the event Tenant fails, in the
reasonable judgment of Landlord, to maintain the Premises in good order,
condition and repair, or otherwise satisfy its repair and replacement
obligations under subsection 7.2.1 or fails to provide the services required
under Section 6.1 above, and such failure continues beyond a reasonable period
of time, Landlord shall have the right to perform such maintenance, repairs and
replacements or provide such services, at Tenant's sole cost and expense. Tenant
shall pay to Landlord on demand any such expense incurred by Landlord plus an
additional five percent (5%) of such amount to compensate Landlord for
Landlord's overhead and administrative costs relating to such work, together
with interest thereon at the rate specified in Section 16.9 from the date of
demand until paid. All such amounts owing pursuant to this Section 7.2.2 shall
be deemed Rent hereunder.
SECTION 7.3 IMPROVEMENTS AND ALTERATIONS:
7.3.1 Landlord's Construction Obligation: Landlord's sole construction
obligation under this Lease is as set forth in the Work Letter attached hereto
as Exhibit D.
7.3.2 Alteration of Building by Landlord: New Construction: Landlord
hereby reserves the right and at all times shall have the right to repair,
change, redecorate, alter, improve, modify, renovate, enclose or make additions
to any part of the Property (including structural elements and load bearing
elements within the Premises), to enclose and/or change the arrangement and/or
location of driveways or parking areas or landscaping or other Common Areas of
the Property, and to construct new improvements on adjacent parcels of land,
all, Tenant agrees, without having committed an actual or constructive eviction
of Tenant or breach of the implied warranty of suitability and without an
abatement of Rent (the "Reserved Right"). When exercising the Reserved Right,
Landlord will use reasonable efforts to minimize interference with Tenant's use
and occupancy of the Premises.
7.3.3 Alterations. Additions. Improvements and Installations by Tenant:
Tenant shall not, without the prior written consent of Landlord, make any
changes, modifications, alterations, additions or improvements (other than
Tenant's Improvements under the Work Letter) to, nor install any equipment or
machinery (other than office equipment and unattached personal property) on, the
Premises (all such changes, modifications, alterations, additions, improvements
other than Tenant's Improvements under the Work Letter and installations
approved by Landlord are herein collectively referred to as "Installations") if
any such Installations would (i) affect structural or load bearing portions of
the Premises, (ii) result in a material increase of electrical usage above the
normal type and amount of electrical current to be provided by Landlord, (iii),
(iv) impact mechanical, electrical or plumbing systems in the Premises or the
Building, (v) affect areas of the Premises which can be viewed from Common
Areas, (vi) require greater or more difficult cleaning work (e.g., kitchens,
reproduction rooms, and interior glass partitions) or (vii) violate any
provision in Article 5 attached hereto. All Installations shall be at Tenant's
sole cost and expense. Without in any way limiting Landlord's consent rights,
Landlord's consent shall be conditioned on (a) Landlord approving the contractor
or person making such Installations and approving such contractor's insurance
coverage to be provided in connection with the work, (b) Landlord's supervision
of the work, (c) Landlord approving final and complete plans and specifications
for the work and (d) the appropriate governmental agency, if any, having final
and complete plans and specifications for such work. All work performed by
Tenant or its contractor relating to the Installations shall conform to
applicable governmental laws, rules and regulations, including, without
limitation, the Disability Acts. Upon completion of the Installations, Tenant
shall deliver to Landlord "as built" plans. All Installations that constitute
improvements constructed within the Premises shall be surrendered with the
Premises at the expiration or earlier termination of this Lease, unless Landlord
requests that same be removed pursuant to Section 2.3 of this Lease and Landlord
shall notify Tenant at the time that Landlord approves the Installations whether
Landlord will require Tenant to remove the Installations and restore the
Premises. TENANT SHALL INDEMNIFY AND SAVE LANDLORD
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HARMLESS FROM ANY AND ALL COSTS, EXPENSES (INCLUDING REASONABLE ATTORNEYS'
FEES AND COSTS), DEMANDS, CLAIMS, CAUSES OF ACTION AND LIENS ARISING FROM
OR IN CONNECTION WITH ANY INSTALLATIONS PERFORMED BY OR ON BEHALF OF
TENANT. All Installations performed by or on behalf of Tenant will be
performed diligently and in a first-class workmanlike manner, and in
compliance with all applicable laws, ordinances, regulations and rules of
any public authority having jurisdiction over the Building and/or Tenant's
and Landlord's insurance carriers. Landlord will have the right, but not
the obligation, to inspect periodically the work on the Premises and may
require changes in the method or quality of the work.
7.3.4 Approvals: Any approval by Landlord (or Landlord's architect
and/or engineers) of any of Tenant's contractors or Tenant's drawings or
plans or specifications which are prepared in connection with any
construction of improvements (including without limitation, Tenant's
Improvements) in the Premises shall not in any way be construed as or
constitute a representation or warranty of Landlord as to the abilities of
the contractor or the adequacy or sufficiency of such drawings, plans or
specifications or the improvements to which they relate, for any use,
purpose or condition.
ARTICLE 8
INSURANCE, FIRE AND CASUALTY
SECTION 8.1 TOTAL OR PARTIAL DESTRUCTION OF THE BUILDING OR THE PREMISES:
Tenant covenants and agrees to immediately give Landlord telephonic and
written notice of any fire or other casualty affecting the Premises or the
Building. In the event that the Building should be totally destroyed by
fire or other casualty or in the event the Building (or any portion
thereof) should be so damaged that rebuilding or repairs cannot be
completed, in Landlord's reasonable opinion, within one hundred twenty
(120) days of Landlord's becoming aware of the applicable fire or casualty,
either Landlord or Tenant may, at its option, terminate this Lease, by
written notice to the other, with Tenant's notice to be given within ten
(10) days after being advised by Landlord that the rebuilding or repairs
cannot be completed within one hundred twenty (120) days. In the event the
Building or the Premises should be damaged by fire or other casualty and,
in Landlord's reasonable opinion, the rebuilding or repairs can be
completed within one hundred twenty (120) days of Landlord's becoming aware
of the applicable fire or casualty, or if the damage should be more serious
but neither Landlord nor Tenant elect to terminate this Lease pursuant to
this Section, Landlord shall, within sixty (60) days after the date of
receipt of notice. of such damage, commence to rebuild or repair the
Building and the Premises (including Tenant's Improvements, but only to the
extent of insurance proceeds actually received by Landlord for the repair
of Tenant's Improvements), and shall pursue with reasonable diligence the
repair and restoration of the Building and the Premises to substantially
the same condition which existed immediately prior to the happening of the
casualty, except that Landlord shall not be required to rebuild, repair or
replace any part of the furniture, equipment, fixtures, inventory, supplies
or any other personalty or any other improvements (except Tenant's
Improvements, but only to the extent of insurance proceeds actually
received by Landlord for the repair of Tenant's Improvements which shall be
first utilized by Landlord before any proceeds of Landlord's insurance)
which may have been placed by Tenant or other tenants within the Building
or at the Premises. Landlord shall allow Tenant a proportionate diminution
of Base Rent and Additional Rent as may be fair and reasonable under the
circumstances during any period of reconstruction or repair of the Premises
due to an occurrence contemplated in this paragraph unless such total or
partial destruction of the Building or Premises was caused by negligence of
the Tenant, its agents, employees, contractors, or invitees.
Notwithstanding Landlord's restoration obligation, in the event any
mortgagee under a deed of trust, security agreement or mortgage on the
Building should require that the insurance proceeds be used to retire or
reduce the mortgage debt or if the insurance company issuing Landlord's
fire and casualty insurance policy fails or refuses to pay Landlord the
proceeds under such policy, Landlord have no obligation to rebuild and this
Lease shall terminate upon notice by Landlord to Tenant. Any insurance
which may be carried by Landlord or Tenant against loss or damage to the
Building or to the Premises shall be for the sole benefit of the party
carrying such insurance under its sole control. Upon termination of the
Lease pursuant to this Section, Base Rent and Additional Rent shall be
abated from the date of the fire or casualty.
SECTION 8.2 TENANT'S INSURANCE:
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8.2.1 Types of Coverage: Tenant covenants and agrees that from and
after the date of delivery of the Premises from Landlord to Tenant, Tenant
will carry and maintain, at its sole cost and expense, the insurance set
forth below:
(a) Liability Insurance: Commercial General Liability Insurance covering
the Premises and Tenant's use thereof against claims for personal or
bodily injury or property damage occurring upon, in or about the Premises
(including contractual indemnity and liability coverage), such insurance
to insure both Tenant and, as additional named insureds, Landlord and its
subsidiaries, directors, agents and employees and the Property Manager,
with limits of not less than $1,000,000.00 per occurrence and
$2,000,000.00 in the aggregate, combined single limit, with respect to
injury to any number of persons and all property damage, without a
deductible. If the Agreed Rentable Area of the Premises is more than
20,000 square feet, then, in addition to and not in lieu of the
above-stated coverage, Tenant shall carry umbrella or so-called excess
coverage in an amount not less than $1,000,000.00 over Tenant's base
coverage amount with no deductible. This insurance coverage shall extend
to any liability of Tenant arising out of the indemnities provided for in
this Lease.
(b) Property Insurance: Property insurance on an "all-risk" coverage
basis covering all fixtures, equipment and personalty located in the
Premises, in an amount not less than one hundred percent (100%) of full
replacement cost thereof, with a deductible not to exceed fifty thousand
dollars ($50,000.00). Such policy will be written in the name of Tenant,
and will name Landlord, and any other parties reasonably designated by
Landlord from time to time, as loss payee, as their respective interests
may appear with respect to any Tenant Improvements or fixtures.
(c) Workers Compensation Insurance: Worker's compensation insurance
including Employers Liability Insurance with limits in amounts not less
than $500,000 per accident, $500,000 per individual, and $500,000 per
policy-disease. Said policy shall insure against and satisfy Tenant's
obligations and liabilities under the worker's compensation laws of the
state where the Property is located.
(d) Such other insurance as Landlord may reasonably require from time to
time.
8.2.2 Other Requirements of Insurance: All such insurance will be
issued and underwritten by companies with an A.M. Best rating of not less
than A-VIII licensed to do business in the state where the Premises is
located and will contain endorsements that (a) such insurance may not lapse
with respect to Landlord or Property Manager or be canceled or amended with
respect to Landlord or Property Manager without the insurance company
giving Landlord and Property Manager at least thirty (30) days prior
written notice of such cancellation or amendment, (b) Tenant will be solely
responsible for payment of premiums, (c) in the event of payment of any
loss covered by such policy, Landlord or Landlord's designees will be paid
first by the insurance company for Landlord's loss and (d) Tenant's
insurance is primary in the event of overlapping coverage which may be
carried by Landlord.
8.2.3 Proof of Insurance: Tenant shall deliver to Landlord duplicate
originals of certificates (policies at Landlord's request) of insurance
required by this Section 8.2 prior to the Commencement Date and duly
executed originals of binders of such insurance evidencing in-force
coverage, within ten (10) days prior to the commencement of construction of
Tenant's Improvements. Further, Tenant shall deliver to Landlord renewals
thereof at least ten (10) days prior to the expiration of the respective
policy terms.
SECTION 8.3 LANDLORD'S INSURANCE:
8.3.1 Types of Coverage: Landlord covenants and agrees that from and
after the date of delivery of the Premises from Landlord to Tenant,
Landlord will carry and maintain the insurance set forth below:
(a) Liability Insurance: Commercial General Liability Insurance covering
the Building and all Common Areas, insuring against claims for personal
or bodily injury or property damage occurring upon, in or about the
Building or Common Areas with limits of not less than $1,000,000.00 per
occurrence and $2,000,000.00 in the aggregate, combined single limit,
with respect to injury to any number of persons and property damage. This
insurance coverage shall extend to any liability of Landlord arising out
of the indemnities provided for in this Lease.
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(b) Property Insurance: Landlord shall at all times during the term hereof
maintain in effect a policy or policies covering the Building (excluding
property required to be insured by Tenant) on an "all risk" basis in such
amounts as Landlord may from time to time determine, providing protection
against perils included within the standard form of "all risk" insurance
policy promulgated in the State where the Property is located, and such
other risks as Landlord may from time to time determine and with any such
deductibles as Landlord may from time to time determine.
8.3.2 Self-Insurance: Any insurance provided for in subsection 8.3.1
may be effected by self-insurance or by a policy or policies of blanket
insurance covering additional items or locations or insureds, provided that
the requirements of this Section 8.3 are otherwise satisfied. Tenant shall
have no rights in any policy or policies maintained by Landlord.
SECTION 8.4 WAIVER OF SUBROGATION:
Landlord and Tenant each hereby waive any rights they may have against the
other (including, but not limited to, a direct action for damages) on
account of any loss or damage occasioned to Landlord or Tenant, as the case
may be (WHETHER OR NOT SUCH LOSS OR DAMAGE IS CAUSED BY THE FAULT,
NEGLIGENCE OR OTHER TORTUOUS CONDUCT, ACTS OR OMISSIONS OF LANDLORD OR
TENANT OR THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR
INVITEES), to their respective property, the Premises, its contents or to
any other portion of the Building or the Property arising from any risk
covered by the current form of property insurance and fire and extended
coverage insurance promulgated by the applicable insurance board or
commission in the State where the Property is located and required to be
carried by Tenant and Landlord, respectively under subsections 8.2.1 and
8.3.1 of this Lease. If a party waiving rights under this Section is
carrying an "all-risk" coverage insurance policy in the promulgated form
used in the state where the Property is located and an amendment to such
promulgated form is passed, such amendment shall be deemed not a part of
such promulgated form until it applies to the policy being carried by the
waiving party. The parties hereto each, on behalf of their respective
insurance companies insuring the property of either Landlord or Tenant
against any such loss, waive any right of subrogation that Landlord or
Tenant or their respective insurers may have against the other party or
their respective officers, directors, employees, agents or invitees and all
rights of their respective insurance companies based upon an assignment
from its insured. Each party to this Lease agrees immediately to give to
each such insurance company written notification of the terms of the mutual
waivers contained in this Section, and to have said insurance policies
properly endorsed, if necessary, to prevent the invalidation of said
insurance coverage by reason of said waivers. The foregoing waiver shall be
effective whether or not the parties maintain the required insurance.
SECTION 8.5 INDEMNITY:
8.5.1 Tenant's Indemnity: TENANT COVENANTS AND AGREES TO INDEMNIFY AND
HOLD LANDLORD, PROPERTY MANAGER AND THEIR RESPECTIVE PARTNERS, TRUST
MANAGERS, OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS HARMLESS FROM ALL
CLAIMS, DEMANDS, ACTIONS, DAMAGES, LOSS, LIABILITIES, JUDGMENTS, COSTS AND
EXPENSES, INCLUDING WITHOUT LIMITATION, ATTORNEYS' FEES AND COURT COSTS
(EACH A "CLAIM" AND COLLECTIVELY THE "CLAIMS") WHICH (i) ARE SUFFERED BY,
RECOVERED FROM OR ASSERTED AGAINST LANDLORD, (ii) ARE NOT PAID BY INSURANCE
CARRIED BY TENANT OR LANDLORD (WITHOUT IN ANY WAY AFFECTING THE
REQUIREMENTS OF OR LANDLORD'S RIGHTS UNDER SECTION 8.2) AND (iii) ARISE
FROM OR IN CONNECTION WITH (a) THE USE OR OCCUPANCY OF THE PREMISES AND/OR
ANY ACCIDENT, INJURY OR DAMAGE OCCURRING IN OR AT THE PREMISES OR (b) ANY
BREACH BY TENANT OF ANY REPRESENTATION OR COVENANT IN THIS LEASE; PROVIDED,
HOWEVER, SUCH INDEMNIFICATION OF LANDLORD BY TENANT SHALL NOT INCLUDE ANY
CLAIM WAIVED BY LANDLORD UNDER SECTION 8.4 HEREOF, ANY CLAIM TO THE EXTENT
CAUSED BY THE NEGLIGENCE OR WILLFUL MISCONDUCT OF LANDLORD OR ANY CLAIM
RELATING TO HAZARDOUS OR TOXIC MATERIALS EXCEPT TO THE EXTENT SUCH CLAIM
ARISES OUT OF A BREACH BY TENANT OF ANY OF THE PROVISIONS OF SUBSECTION
5.1.2.
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8.5.2 Landlord's Indemnity: LANDLORD WILL INDEMNIFY AND HOLD TENANT
AND ITS OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS HARMLESS FROM ALL CLAIMS
WHICH ARE SUFFERED BY, RECOVERED FROM OR ASSERTED AGAINST TENANT AND WHICH
ARE NOT PAID BY PROCEEDS OF INSURANCE CARRIED BY LANDLORD OR TENANT AND
WHICH ARISE FROM OR IN CONNECTION WITH (a) THE USE OF THE COMMON AREAS
AND/OR ANY ACCIDENT, INJURY OR DAMAGE OCCURRING IN OR ON THE COMMON AREAS
OR (b) ANY BREACH BY LANDLORD OF ANY REPRESENTATION OR COVENANT IN THIS
LEASE; PROVIDED, HOWEVER, SUCH INDEMNIFICATION OF TENANT BY LANDLORD SHALL
NOT INCLUDE ANY CLAIM WAIVED BY TENANT UNDER SECTION 8.4 HEREOF, ANY CLAIM
TO THE EXTENT CAUSED BY THE NEGLIGENCE OR WILLFUL MISCONDUCT OF TENANT OR
ANY CLAIM RELATING TO HAZARDOUS OR TOXIC MATERIALS EXCEPT TO THE EXTENT
SUCH CLAIM ARISES OUT OF A BREACH BY LANDLORD OF ANY OF THE PROVISIONS OF
SUBSECTION 5.1.2.
ARTICLE 9
CONDEMNATION
SECTION 9.1 CONDEMNATION OF THE PROPERTY: If the Property or any portion
thereof that, in Landlord's reasonable opinion, is necessary to the
continued efficient and/or economically feasible use of the Property shall
be taken or condemned in whole or in part for public purposes, or sold to a
condemning authority in lieu of taking, then the term of this Lease shall,
upon Landlord's written notice to Tenant, forthwith cease and terminate.
SECTION 9.2 CONDEMNATION OF PREMISES: In the event that all or
substantially all of the Premises are taken or condemned or sold in lieu
thereof or Tenant will be unable to use a substantial portion of the
Premises for a period exceeding one hundred twenty (120) consecutive days
by reason of a temporary taking, either Landlord or Tenant may terminate
this Lease by delivering written notice thereof to the other within ten
(10) business days after the taking, condemnation or sale in lieu thereof.
SECTION 9.3 CONDEMNATION WITHOUT TERMINATION: If upon a taking or
condemnation or sale in lieu of the taking of all or less than all of the
Property which gives either Landlord or Tenant the right to terminate this
Lease pursuant to Section 9.1 or 9.2 and neither Landlord nor Tenant elects
to exercise such termination right, then this Lease shall continue in full
force and effect, provided that, if the taking, condemnation or sale
includes any portion of the Premises or the Building, the Base Rent and
Additional Rent shall be redetermined on the basis of the remaining square
feet of Agreed Rentable Area of the Premises or the Building. Landlord, at
Landlord's sole option and expense, shall restore and reconstruct the
Building to substantially its former condition to the extent that the same
may be reasonably feasible, but such work shall not be required to exceed
the scope of the work done by Landlord in originally constructing the
Building, nor shall Landlord in any event be required to spend for such
work in an amount in excess of the amount received by Landlord as
compensation or damages (in excess of amounts retained by the mortgagee of
the Property relating to the property taken) for the part of the Building
or the Premises so taken.
SECTION 9.4 CONDEMNATION PROCEEDS: Landlord shall receive the entire award
(which shall include sales proceeds) payable as a result of a condemnation,
taking or sale in lieu thereof. Tenant hereby expressly assigns to Landlord
any and all right, title and interest of Tenant now or hereafter arising in
and to any such award. Tenant shall, however, have the right to recover
from such authority through a separate award which does not reduce the
Landlord's award, any compensation as may be awarded to Tenant on account
of moving and relocation expenses and depreciation to and removal of
Tenant's physical property.
ARTICLE 10
LIENS
Tenant shall keep the Premises free from all liens arising out of any work
performed, materials furnished or obligations incurred by or for Tenant and
TENANT SHALL INDEMNIFY AND HOLD LANDLORD
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HARMLESS FROM ANY AND ALL CLAIMS, CAUSES OF ACTION, DAMAGES, EXPENSES
(INCLUDING REASONABLE ATTORNEYS' FEES AND COSTS), ARISING FROM OR IN
CONNECTION WITH ANY SUCH LIENS. In the event that Tenant shall not, within
ten (10) days following notification to Tenant of the imposition of any
such lien, cause the same to be released of record by payment or the
posting of a bond in amount, form and substance acceptable to Landlord,
Landlord shall have, in addition to all other remedies provided herein and
by law, the right but not the obligation, to cause the same to be released
by such means as it shall deem proper, including payment of or defense
against the claim giving rise to such lien. All amounts paid or incurred by
Landlord in connection therewith shall be paid by Tenant to Landlord on
demand and shall bear interest from the date of demand until paid at the
rate set forth in Section 16.9. Nothing in this Lease shall be deemed or
construed in any way as constituting the consent or request of Landlord,
express or implied, by inference or otherwise, to any contractor,
subcontractor, laborer or materialman for the performance of any labor or
the furnishing of any materials for any specific improvement, alteration or
repair of or to the Building or the Premises or any part thereof, nor as
giving Tenant any right, power or authority to contract for or permit the
rendering of any services or the furnishing of any materials that would
give rise to the filing of any mechanic's or other liens against the
interest of Landlord in the Property or the Premises.
ARTICLE 11
TAXES ON TENANT'S PROPERTY
Tenant shall be liable for and shall pay, prior to their becoming
delinquent, any and all taxes and assessments levied against, and any
increases in Real Estate Taxes as a result of, any personal property or
trade or other fixtures placed by Tenant in or about the Premises and any
improvements (excluding Tenant's Improvements) constructed in the Premises
by or on behalf of Tenant. In the event Landlord, at its sole election,
pays any such additional taxes, or increases, Tenant will, within ten (10)
days after demand, reimburse Landlord for the amount thereof. Such amounts
shall bear interest from the date paid by Landlord until reimbursed by
Tenant at the rate set forth in Section 16.9.
ARTICLE 12
SUBLETTING AND ASSIGNING
SECTION 12.1 SUBLEASE AND ASSIGNMENT: Tenant may assign this Lease in
connection with a corporate reorganization, acquisition, merger or sale of
all or substantially all of its assets. Tenant must notify Landlord within
ten (10) business days of such assignment. Subject to the foregoing, Tenant
shall not assign this Lease, or allow it to be assigned, in whole or in
part, by operation of law or otherwise or mortgage or pledge the same, or
sublet the Premises or any part thereof or permit the Premises to be
occupied by any firm, person, partnership or corporation or any combination
thereof, other than Tenant, without the prior written consent of Landlord
and such consent shall not be unreasonably withheld. In no event shall any
assignment or sublease ever release Tenant from any obligation or liability
hereunder. No assignee or sublessee of the Premises or any portion thereof
may assign or sublet the Premises or any portion thereof. Consent by
Landlord to one or more assignments or sublettings shall not operate as a
waiver of Landlord's rights as to any subsequent assignments and/or
sublettings. All reasonable legal fees and expenses incurred by Landlord in
connection with any assignment or sublease proposed by Tenant will be the
responsibility of Tenant and will be paid by Tenant within twenty (20) days
of receipt of an invoice from Landlord. In addition, Tenant will pay to
Landlord an administrative overhead fee of not less than $500.00 in
consideration for Landlord's review of any requested assignment or
sublease.
SECTION 12.2 LANDLORD'S RIGHTS RELATING TO ASSIGNEE OR SUBTENANT: If this
Lease or any part hereof is assigned or the Premises or any part thereof
are sublet, Landlord may at its option collect directly from such assignee
or sublessee all rents becoming due to Tenant under such assignment or
sublease and apply such rent against any sums due to Landlord by Tenant
hereunder, with Tenant and Landlord splitting, 50/50 any excess rent after
reasonable commissions and any tenant finish-out associated and paid in
connection with such assignment or sublet. Tenant hereby authorizes and
directs any such assignee or sublessee to make such payments of rent
directly to Landlord upon receipt of notice from Landlord, and Tenant
agrees that any such payments made by an assignee or sublessee to Landlord
shall, to
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the extent of the payments so made, be a full and complete release and
discharge of rent owed to Tenant by such assignee or sublessee. No direct
collection by Landlord from any such assignee or sublessee shall be
construed to constitute a novation or a release of Tenant or any guarantor
of Tenant from the further performance of its obligations hereunder.
Receipt by Landlord of rent from any assignee, sublessee or occupant of the
Premises or any part thereof shall not be deemed a waiver of the above
covenant in this Lease against assignment and subletting or a release of
Tenant under this Lease. In the event that, following an assignment or
subletting, this Lease or the rights and obligations of Tenant hereunder
are terminated for any reason, including without limitation in connection
with default by or bankruptcy of Tenant (which, for the purposes of this
Section 12.2, shall include all persons or entities claiming by or through
Tenant), Landlord may, at its sole option, consider this Lease to be
thereafter a direct lease to the assignee or subtenant of Tenant upon the
terms and conditions contained in this Lease.
ARTICLE 13
SUBORDINATION AND TENANT'S ESTOPPEL CERTIFICATE
SECTION 13.1 SALE OF THE PROPERTY: In the event of a sale or conveyance by
Landlord of the Property, the same shall operate to release Landlord from
any and all liability under this Lease arising after the date of such sale,
provided that if a Security Deposit has been paid by Tenant, Landlord shall
not be released from liability with respect thereto unless Landlord
transfers or credits the Security Deposit to the applicable purchaser.
SECTION 13.2 SUBORDINATION, ATTORNMENT AND NOTICE: This Lease is subject
and subordinate to any lease wherein Landlord is the tenant and to the
liens of any and all mortgages or deeds of trust, regardless of whether
such lease, mortgages or deeds of trust now exist or may hereafter be
created with regard to all or any part of the Property, and to any and all
advances to be made thereunder, and to the interest thereon, and all
modifications, consolidations, renewals, replacements and extensions
thereof. Tenant also agrees that any lessor, mortgagee or trustee may elect
(which election shall be revocable) to have this Lease superior to any
lease or lien of its mortgage or deed of trust, and in the event of such
election and upon notification by such lessor, mortgagee or trustee to that
effect, this Lease shall be deemed superior to the said lease, mortgage or
deed of trust, whether this Lease is dated prior to or subsequent to the
date of said lease, mortgage or deed of trust. Tenant shall, in the event
of the sale or assignment of Landlord's interest in the Premises (except in
a sale-leaseback financing transaction), or in the event of a termination
of any lease in a sale-leaseback financing transaction wherein Landlord is
the lessee, attorn to and recognize such purchaser, assignee or mortgagee
as Landlord under this Lease. Tenant shall, in the event of any proceedings
brought for the foreclosure of, or in the event of the exercise of the
power of sale under, any mortgage or deed of trust covering the Premises,
attorn to and recognize purchaser at such sale, assignee, or mortgagee, as
the case may be, as Landlord under this Lease. Tenant shall not seek to
enforce any remedy it may have for any default on the part of Landlord
without giving written notice specifying the default in reasonable detail
to any lessor, mortgagee or trustee whose address has been delivered to
Tenant, and affording such lessor, mortgagee or trustee a reasonable
opportunity to perform and/or cure Landlord's default. Tenant further
agrees that any lessor, mortgagee, trustee or purchaser at foreclosure
shall not be liable for any acts of Landlord, shall not be liable for the
Security Deposit if not actually received by any such party, be bound by
any amendment of this Lease to which it did not consent in writing or be
obligated to recognize Tenant's payment of any Rent which is paid to
Landlord more than thirty (30) days in advance of its due date. The above
subordination and attornment clauses shall be self-operative and no further
instruments of subordination or attornment need be required by any
mortgagee, trustee, lessor, purchaser or assignee. In confirmation thereof,
Tenant agrees that, upon the request of Landlord, or any such lessor,
mortgagee, trustee, purchaser or assignee, Tenant shall execute and deliver
whatever instruments may be required for such purposes and to carry out the
intent of this Section 13.2.
SECTION 13.3 TENANT'S ESTOPPEL CERTIFICATE: Tenant shall, within ten (10)
days of the receipt of a request of Landlord or any mortgagee of Landlord,
without additional consideration, deliver an estoppel certificate,
consisting of reasonable statements required by Landlord, any mortgagee or
purchaser of any interest in the Property, which statements may include but
shall not be limited to the following: the commencement date of this Lease;
the amount of any security deposit; that Lease is in full force and effect,
with rental paid through the current date specified by Tenant and that
Tenant is not in default; that Lease has
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not been modified or amended; that Landlord is not in default and has fully
performed all of its obligations hereunder. If Tenant is unable to make any
of the statements contained in the estoppel certificate because the same is
untrue, Tenant shall with specificity state the reason why such statement
is untrue. Tenant shall, if requested by Landlord or any such mortgagee,
deliver to Landlord a fully executed instrument in form reasonably
satisfactory to Landlord evidencing the agreement of Tenant to the mortgage
or other hypothecation by Landlord of the interest of Landlord hereunder.
ARTICLE 14
DEFAULT
SECTION 14.1 DEFAULTS BY TENANT: The occurrence of any of the events
described in subsections 14.1.1 through 14.1.7 shall constitute a default
and breach of this Lease by Tenant.
14.1.1 Failure to Pay Rent: Any failure by Tenant to pay Rent or to
make any other payment required to be made by Tenant hereunder when due, no
notice being required for default in payment of Rent.
14.1.2 Failure to Perform: Except for failure covered by subsection
14.1.1 or 14.1.3, any failure by Tenant to observe and perform any
provision of this Lease to be observed or performed by Tenant where such
failure continues for fifteen (15) days after written notice to Tenant,
provided that if such failure cannot be cured within said fifteen (15) day
period, Tenant shall not be in default hereunder so long as Tenant
commences curative action within such fifteen (15) day period, diligently
and continuously pursues the curative action.
14.1.3 Continual Failure to Perform: The third failure by Tenant to
perform and observe a particular provision of this Lease to be observed or
performed by Tenant (other than the failure to pay Rent, which in all
instances will be covered by subsection 14.1.1), no notice or cure period
being required or afforded for any such third failure.
14.1.4 Bankruptcy, Insolvency, Etc.: Tenant or any guarantor of
Tenant's obligations hereunder, cannot meet its obligations as they become
due; or is declared insolvent according to any law; or an assignment of
Tenant's or Guarantor's property is made for the benefit of creditors; or a
receiver or trustee is appointed for Tenant or Guarantor or their
respective properties; or the interest of Tenant or Guarantor under this
Lease is levied on under execution or under other legal process; or any
petition is filed by or against Tenant or Guarantor to declare Tenant or
Guarantor bankrupt or to delay, reduce or modify Tenant's or Guarantor's
debts or obligations; or any petition is filed or other action taken to
reorganize or modify Tenant's or Guarantor's capital structure if either
Tenant or Guarantor be a corporation or other entity (provided that no such
levy, execution, legal process or petition filed against Tenant or
Guarantor shall constitute a breach of this Lease if Tenant or Guarantor
shall vigorously contest the same by appropriate proceedings and shall
remove or vacate the same within sixty (60) days from the date of its
creation, service or filing).
14.1.5 Abandonment; Vacation: The abandonment of the Premises by
Tenant, or the vacating of the Premises by Tenant, which shall be
conclusively presumed if Tenant is absent from the Premises for ten (10)
consecutive days or more or if Tenant shall fail to move into or take
possession of the Premises within ten (10) days after the date on which
Rent is to commence under the terms of this Lease.
14.1.6 Loss of Right to do Business: If Tenant fails to maintain its
right to do business in the state in which the Property is located or fails
to pay any applicable annual franchise or other applicable taxes or
assessments as and when the same become finally due and payable.
14.1.7 Dissolution or Liquidation: Tenant dissolves or liquidates or
otherwise fails to maintain its corporate or partnership structure, as
applicable.
SECTION 14.2 REMEDIES OF LANDLORD: Upon the occurrence of any default by
tenant specified in Section 14.1, Landlord, at its option, may in addition
to all other rights and remedies provided herein or at law or in equity,
exercise one or more of the remedies set forth in subsections 14.2.1,
14.2.2 or 14.2.3.
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14.2.1 Termination of the Lease: Upon the occurrence of a default
hereunder, Landlord may terminate this Lease and Tenant's right of
possession of the Premises by giving written notice thereof to Tenant
(whereupon all obligations and liabilities of Landlord hereunder shall
terminate) and, without further notice and without liability, repossess the
Premises. Landlord shall be entitled to recover all loss and damage
Landlord may suffer by reason of such termination, whether through
inability to relet the Premises on satisfactory terms or otherwise,
including without limitation, the following (without duplication of any
element of damages):
(a) accrued Rent to the date of termination and Late Charges, plus
interest thereon at the rate established under Section 16.9 from the date
due through the date paid or date of any judgment or award by any court
of competent jurisdiction, the unamortized cost of Tenant's Improvements,
brokers' fees and commissions, attorneys' fees, moving allowances, and
any other costs incurred by Landlord in connection with making or
executing this Lease, the cost of recovering the Premises and the costs
of reletting the Premises (including without limitation advertising
costs, brokerage fees, leasing commissions, reasonable attorneys' fees,
and refurbishing costs and other costs in readying the Premises for a new
tenant); and
(b) the present value of the Rent (discounted at a rate of interest equal
to six percent (6%) per annum (the "Discount Rate")) that would have
accrued under this Lease for the balance of the Lease term but for such
termination, reduced by the reasonable fair market rental value of the
Premises for such balance of the Lease term (determined from the present
value of the actual base rents, discounted at the Discount Rate, received
and to be received from Landlord's reletting of the Premises or, if the
Premises are not relet, the base rents, discounted at the Discount Rate,
that would be received from a comparable lease and comparable tenant for
a comparable term and taking into account among other things, the
condition of the Premises, market conditions and the period of time the
Premises may reasonably remain vacant before Landlord is able to re-lease
the same to a suitable replacement tenant, it being agreed that Landlord
shall have no obligation to relet or attempt to relet the Premises); and
(c) any other costs or amounts necessary to compensate Landlord for its
damages.
14.2.2 Repossession and Re-Entry: Upon the occurrence of a default
hereunder, Landlord may, without judicial process, immediately terminate
Tenant's right of possession of the Premises (whereupon all obligations
and liability of Landlord hereunder shall terminate), but not terminate
this Lease, and, without notice, demand or liability, enter upon the
Premises or any part thereof, take absolute possession of the same, expel
or remove Tenant and any other person or entity who may be occupying the
Premises and change the locks and other security systems. If Landlord
terminates Tenant's possession of the Premises under this subsection
14.2.2, (i) Landlord shall have no obligation whatsoever to tender to
Tenant a key or other form of access for the new locks and other security
systems installed in the Premises, (ii) Tenant shall have no further
right to possession of the Premises, and (iii) Landlord shall have no
obligation whatsoever to relet or attempt to relet the Premises. Landlord
may, however, at its sole option relet the Premises or any part thereof
for such terms and such rents as Landlord may in its sole discretion
elect. If Landlord elects to relet the Premises, rent received by
Landlord from such reletting shall be applied first, to the payment of
any indebtedness other than Rent due hereunder from Tenant to Landlord
(in such order as Landlord shall designate), second, to the payment of
any cost of such reletting, including, without limitation, refurbishing
costs, reasonable attorneys' fees, advertising costs, brokerage fees and
leasing commissions, and third, to the payment of Rent due and unpaid
hereunder (in such order as Landlord shall designate), and Tenant shall
satisfy and pay to Landlord any deficiency upon demand therefor from time
to time. Landlord shall not be responsible or liable for any failure to
relet the Premises or any part thereof or for any failure to collect any
rent due upon any such reletting. No such re-entry or taking of
possession of the Premises by Landlord shall be construed as an election
on Landlord's part to terminate this Lease unless a written notice of
such termination is given to Tenant pursuant to subsection 14.2.1. If
Landlord relets the Premises, either before or after the termination of
this Lease, all such rentals received from such lease shall be and remain
the exclusive property of Landlord, and Tenant shall not be, at any time,
entitled to recover any such rental. Landlord may at any time after a
reletting elect to terminate this Lease. To the maximum extent permitted
by applicable laws, Tenant hereby waives any requirement of Landlord to
mitigate its damages by reletting the Premises. In the event Landlord is
required, by Law, to mitigate
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its damages, Tenant agrees and acknowledges that the following actions of
the landlord constitute "objectively reasonable efforts": within
forty-five (45) days after Landlord acquires possession of the Premises,
placing a "For Lease" sign at the Premises; making Landlord's inventory
available to area brokers; and showing the Premises to prospective
tenants who request to see it.
14.2.3 Cure of Default: Landlord may enter upon the Premises, without
having any liability therefor, and do whatever Tenant is obligated to do
under the terms of this Lease and Tenant agrees to reimburse Landlord on
demand for any expenses which Landlord may incur in effecting compliance
with Tenant's obligations under this Lease and Tenant further agrees that
Landlord shall not be liable for any damages resulting to Tenant from such
action, WHETHER CAUSED BY THE NEGLIGENCE OF LANDLORD OR OTHERWISE.
14.2.4 Continuing Obligations: No repossession of or re-entering upon
the Premises or any part thereof pursuant to subsection 14.2.2 or 14.2.3 of
this Section or otherwise and no reletting of the Premises or any part
thereof pursuant to subsection 14.2.2 shall relieve Tenant or any Guarantor
of its liabilities and obligations hereunder, all of which shall survive
such repossession or re-entering. In the event of any such repossession of
or re-entering upon the Premises or any part thereof by reason of the
occurrence of a default, Tenant will continue to pay to Landlord Rent
required to be paid by Tenant.
14.2.5 Cumulative Remedies: No right or remedy herein conferred upon
or reserved to Landlord is intended to be exclusive of any other right or
remedy, and each and every right and remedy shall be cumulative and in
addition to any other right or remedy given hereunder or now or hereafter
existing at law or in equity or by statute. In addition to the other
remedies provided in this Lease, Landlord shall be entitled, to the extent
permitted by applicable law, to injunctive relief in case of the violation,
or attempted or threatened violation, of any of the covenants, agreements
conditions or provisions of this Lease, or to a decree compelling
performance of any of the covenants, agreements, conditions or provisions
of this Lease, or to any other remedy allowed to Landlord at law or in
equity.
14.2.6 Limitation on Tenant's Liability. Except in a proceeding by
Landlord under Section 2.4 and as otherwise specifically provided herein,
in no event shall Tenant be liable to Landlord for consequential or special
damages by reason of a failure to perform (or a default) by Tenant
hereunder or otherwise.
SECTION 14.3 DEFAULTS BY LANDLORD: Landlord shall be in default under this
Lease if Landlord fails to perform any of its obligations hereunder and
said failure continues for a period of fifteen (15) days after Tenant
delivers written notice thereof to Landlord (to each of the addresses
required by this Section) and each mortgagee who has a lien against any
portion of the Property and whose name and address has been provided to
Tenant, provided that if such failure cannot reasonably be cured within
said fifteen (15) day period, Landlord shall not be in default hereunder if
the curative action is commenced within said fifteen (15) day period and is
thereafter diligently pursued until cured. In no event shall (i) Tenant
claim a constructive or actual eviction or that the Premises have become
unsuitable hereunder or (ii) a constructive or actual eviction or breach of
the implied warranty of suitability be deemed to have occurred under this
Lease, prior to the expiration of the notice and cure periods provided
under this Section 14.3. Any notice of a failure to perform by Landlord
shall be sent to Landlord at the addresses and to the attention of the
parties set forth in Item 14 of Article 1. Any notice of a failure to
perform by Landlord not sent to Landlord at all addresses and/or to the
attention of all parties required under this Section and to each mortgagee
who is entitled to notice or not sent in compliance with Article 15 shall
be of no force or effect,
SECTION 14.4 LANDLORD'S LIABILITY:
14.4.1 Limitations of Recourse: Tenant is granted no contractual right
of termination by this Lease, except to the extent and only to the extent
set forth in Sections 8.1 and 9.2, or in any Rider which may be attached
hereto. If Tenant shall recover a money judgment against Landlord, such
judgment shall be satisfied only out of the right, title and interest of
Landlord in the Property as the same may then be encumbered and Landlord,
its trust managers, partners, officers, employees and shareholders shall
not be liable for any deficiency or other property of Landlord be levied
for execution. In no event shall Landlord be liable to Tenant for
consequential or special damages by reason of a failure to perform (or a
default) by Landlord hereunder or otherwise.
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14.4.2 Limitations on Landlord's Liability: Unless covered by Section
8.5.2, Landlord shall not be liable to Tenant for any claims, actions,
demands, costs, expenses or damage or liability of any kind arising from
(i) the use, occupancy or enjoyment of the Premises by Tenant or any person
therein or holding under Tenant or by or through the acts or omissions of
any of their respective employees, officers, agents, invitees, or
contractors; (ii) fire, explosion, falling sheetrock, gas, electricity,
water, rain, or snow, or dampness or leaks in any part of the Premises,
(iii) the pipes, appliances or plumbing works or from heating, ventilation
or air conditioning equipment, the roof, street, or subsurface, or (iv)
tenants or any persons either in the Premises or elsewhere in the Building
(other than Common Areas), or by occupants of Property adjacent to the
Building or Common Areas, or by the public or by the construction of any
private, public, or quasi-public work. In no event shall Landlord be liable
to Tenant for any loss of or damage to property of Tenant or of others
located in the Premises or the Building by reason of theft or burglary.
ARTICLE 15
NOTICES
Any notice required or permitted in this Lease shall be given in writing,
sent by (a) personal delivery, or (b) Federal Express or similar overnight
carrier with proof of delivery, or (c) United States mail, postage prepaid,
addressed as provided in Item 14 of Article 1 hereof, or to such other
address or to the attention of such other person as shall be designated
from time to time in writing by the applicable party and sent in accordance
herewith. Notice also may be given by telex or fax, provided each
transmission is confirmed (and such confirmation is supported by documented
evidence) as received and further provided a telex or fax number, as the
case may be, is set forth in Item 14 of Article 1. Any such notice or
communication shall be deemed to have been given either at the time of
receipt of personal delivery or, in the case of overnight courier service
or mail, as of the date of first attempted delivery at the address and in
the manner provided herein, or in the case of telegram or telex or fax,
upon receipt.
ARTICLE 16
MISCELLANEOUS PROVISIONS
SECTION 16.1 BUILDING NAME AND ADDRESS: Tenant shall not, without the prior
written consent of Landlord, use the name of the Building for any purpose
other than as the address of the business to be conducted by Tenant in the
Premises, and in no event shall Tenant acquire any rights in or to such
names. Landlord shall have the right at any time to change the name,
number, address, or designation by which the Building is known.
SECTION 16.2 SIGNAGE: Tenant shall not without the prior written consent of
Landlord erect, inscribe, paint, affix or display anything or other
insignia upon any part of the Property or any portion of the Premises.
Without in any way limiting the foregoing, any signs erected by Tenant
shall conform to all laws, ordinances, statutes, rules, regulations or
other governmental or quasi-governmental or restrictive covenant
requirements and standard signage criteria that Landlord has prescribed for
the Property. Once approved by Landlord and erected by Tenant, Tenant shall
keep and maintain such signs in good repair and remove the same and restore
the Premises (and/or Property) prior to the Expiration Date (as set forth
in Item 5 of Article 1) to their original condition.
SECTION 16.3 NO WAIVER: No waiver by Landlord or by Tenant of any provision
of this Lease shall be deemed to be a waiver by either party of any other
provision of this Lease. No waiver by Landlord or Tenant of any breach by
the other shall be deemed a waiver of any subsequent breach by such party
of the same or any other provision. The failure of Landlord or Tenant to
insist at any time upon the strict performance of any covenant or agreement
or to exercise any option, right, power or remedy contained in this Lease
shall not be construed as a waiver or a relinquishment thereof for the
future. Landlord's or Tenant's consent to or approval of any act by the
other party requiring the other party's consent or approval shall not be
deemed to render unnecessary the obtaining consent to or approval of any
subsequent act of the other party. No act or thing done by Landlord or
Landlord's agents during the term of this Lease shall be deemed an
acceptance of a surrender of the Premises, unless done in writing signed by
Landlord. The
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delivery of the keys or access cards to any employee or agent of Landlord
shall not operate as a termination of this Lease or a surrender of the
Premises. The acceptance of any Rent by Landlord following a breach of this
Lease by Tenant shall not constitute a waiver by Landlord of such breach or
any other breach. No waiver by Landlord or Tenant of any provision of this
Lease shall be deemed to have been made unless such waiver is expressly
stated in writing signed by the waiving party. No payment by Tenant or
receipt by Landlord of a lesser amount than the monthly installment of Rent
due under this Lease shall be deemed to be other than on account of the
earliest Rent due hereunder, nor shall any endorsement or statement on any
check or any letter accompanying any check or payment as Rent be deemed an
accord and satisfaction and Landlord may accept such check or payment
without prejudice to Landlord's right to recover the balance of such Rent
or pursue any other remedy which may be available to Landlord.
SECTION 16.4 APPLICABLE LAW: This Lease shall be governed by and construed
in accordance with the laws of the state where the Property is located.
Furthermore, this Lease shall not be construed against either party more or
less favorably by reason of authorship or origin of language.
SECTION 16.5 SUCCESSORS AND ASSIGNS: Subject to Article 12 hereof, all of
the covenants, conditions and provisions of this Lease shall be binding
upon and shall inure to the benefit of the parties hereto and their
respective heirs, personal representative, successors and assigns.
SECTION 16.6 BROKERS: Tenant warrants that it has had no dealings with any
real estate broker or agent in connection with the negotiation of this
Lease, excepting only the broker named in Item 11 of Article 1, and that it
knows of no other real estate brokers or agents who are or might be
entitled to a commission in connection with this Lease. Tenant agrees to
indemnify and hold harmless Landlord from and against any liability or
claim whether meritorious or not, arising in respect to brokers and/or
agents not so named. Landlord has agreed to pay the fees of the brokers
(but only the brokers) named in Items 10 and 11 of Article 1 to the extent
that Landlord has agreed to do so pursuant to a written agreement with such
brokers.
SECTION 16.7 SEVERABILITY: If any provision of this Lease or the
application thereof to any person or circumstances shall be invalid or
unenforceable to any extent, the application of such provisions to other
persons or circumstances and the remainder of this Lease shall not be
affected thereby and shall be enforced to the greatest extent permitted by
law.
SECTION 16.8 EXAMINATION OF LEASE: Submission by Landlord of this
instrument to Tenant for examination or signature does not constitute a
reservation of or option for lease. This Lease will be effective as a lease
or otherwise only upon execution by and delivery to both Landlord and
Tenant.
SECTION 16.9 INTEREST ON TENANT'S OBLIGATIONS: In addition to the late
charges specified in Section 3.4, any amount due from Tenant to Landlord
which is not paid on or before the date due shall bear interest at the
lower of (i) twelve percent (12%) per annum or (ii) the highest rate from
time to time allowed by applicable law, from the date such payment is due
until paid, but the payment of such interest shall not excuse or cure the
default.
SECTION 16.10 TIME: Time is of the essence in this Lease and in each and
all of the provisions hereof. Whenever a period of days is specified in
this Lease, such period shall refer to calendar days unless otherwise
expressly stated in this Lease.
SECTION 16.11 DEFINED TERMS AND MARGINAL HEARINGS: The words Landlord and
Tenant as used herein shall include the plural as well as singular. If more
than one person is named as Tenant, the obligations of such persons are
joint and several. The headings and titles to the articles, sections and
subsections of this Lease are not a part of this Lease and shall have no
effect upon the construction or interpretation of any part of this Lease.
SECTION 16.12 AUTHORITY OF TENANT: Tenant and each person signing this
Lease on behalf of Tenant represents to Landlord as follows: Tenant and its
general partners and managing members, if applicable, are each duly
organized and legally existing under the laws of the state of its
incorporation and is duly qualified to do business in the state where the
Property is located. Tenant and, it general partners and managing members,
if applicable, each has all requisite power and all governmental
certificates of authority,
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24
licenses, permits, qualifications and other documentation to lease the
Premises and to carry on its business as now conducted and as contemplated
to be conducted. Each person signing on behalf of Tenant is authorized to
do so.
SECTION 16.13 FORCE MAJEURE: Whenever a period of time is hereby prescribed
for action to be taken by Landlord or Tenant, the party taking the action
shall not be liable or responsible for, and there shall be excluded from
the computation of any such period of time, any delays due to strikes,
riots, acts of God, shortages of labor or materials, war, governmental
laws, regulations or restrictions or any other causes of any kind
whatsoever which are beyond the reasonable control of such party; provided,
however, in no event shall the foregoing apply to the financial obligations
of either Landlord or Tenant to the other under this Lease, including
Tenant's obligation to pay Base Monthly Rent, Additional Rent or any other
amount payable to Landlord hereunder.
SECTION 16.14 RECORDING: This Lease shall not be recorded. However,
Landlord shall have the right to record a short form or memorandum hereof,
at Landlord's expense, at any time during the terms hereof, and, if
requested, Tenant agrees (without charge to Landlord) to join in the
execution thereof.
SECTION 16.15 NO REPRESENTATIONS: LANDLORD AND LANDLORD'S AGENTS HAVE MADE
NO WARRANTIES, REPRESENTATIONS OR PROMISES (EXPRESS OR IMPLIED) WITH
RESPECT TO THE PREMISES, THE BUILDING OR ANY OTHER PART OF THE PROPERTY
(INCLUDING, WITHOUT LIMITATION, THE CONDITION, USE OR SUITABILITY OF THE
PREMISES, THE BUILDING OR THE PROPERTY), EXCEPT AS HEREIN EXPRESSLY SET
FORTH AND NO RIGHTS, EASEMENTS OR LICENSES ARE ACQUIRED BY TENANT BY
IMPLICATION OR OTHERWISE EXCEPT AS EXPRESSLY SET FORTH IN THE PROVISIONS OF
THIS LEASE.
SECTION 16.16 PARKING: The parking areas and any parking structures shall
be designated for automobile parking on a non-exclusive basis for all
Property tenants (including Tenant) and their respective employees,
customers, invitees and visitors. Unreserved parking, at no additional
charge to Tenant is equal to one (1) automobile space per two hundred
fifteen (215) square feet of rented Premises. Parking allotment includes a
proportionate share of handicapped spaces required. Tenant shall have the
use of loading areas behind the Building. Parking and delivery areas for
all vehicles shall be in accordance with parking regulations established
from time to time by Landlord with which Tenant agrees to conform. Tenant
shall only permit parking by its employees, customers and agents of
appropriate vehicles in appropriate designated parking areas.
SECTION 16.17 ATTORNEYS' FEES: In the event of any legal action or
proceeding brought by either party against the other arising out of this
Lease, the prevailing party shall be entitled to recover reasonable
attorneys' fees and costs incurred in such action (including, without
limitation, paralegal and administrative specialists fees and all costs of
appeal) and such amount shall be included in any judgment rendered in such
proceeding.
SECTION 16.18 NO LIGHT, AIR OR VIEW EASEMENT: Any diminution or shutting
off of light, air or view by any structure which may be erected on the
Property or lands adjacent to the Property shall in no way affect this
Lease or impose any liability on Landlord (even if Landlord is the adjacent
land owner).
SECTION 16.19 SURVIVAL OF INDEMNITIES: Each indemnity agreement and hold
harmless agreement contained herein shall survive the expiration or
termination of the Lease.
SECTION 16.20 DPTC WAIVER: [THIS SECTION INTENTIONALLY DELETED]
SECTION 16.21 PROPERTY TAX APPEAL WAIVER [THIS SECTION INTENTIONALLY
DELETED]
SECTION 16.22 ENTIRE AGREEMENT: This Lease, consisting of sixteen Articles
and Exhibits "A" through "D", Rider 1, and Addendum 1, contains all of the
agreements of the parties hereto with respect to any matter covered or
mentioned in this Lease, and no prior agreement, understanding or
representation pertaining to any such matter shall be effective for any
purpose. No provision of this Lease may be amended
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or added to except by an agreement in writing signed by the parties hereto
or their respective successors in interest.
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Lease as of the date specified in the introductory paragraph of this
Lease.
LANDLORD:
AMERICAN INDUSTRIAL PROPERTIES REIT,
a Texas real estate investment trust
By: its duly authorized agent
By: /s/ JOSEPH D. AKERS
----------------------------------
Name: Joseph D. Akers
--------------------------------
Title: VP
-------------------------------
TENANT:
CIRRUS LOGIC, INC.
By: /s/ [ILLEGIBLE]
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
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