1
Exhibit 10.3
INDUSTRIAL LEASE
between
CALFRONT ASSOCIATES, as Landlord
and
GIGA-TRONICS INCORPORATED, as Tenant
for
4650 NORRIS CANYON ROAD
Dated
as of December 6, 1993
12/6/93
2
SCHEDULE A
BASIC LEASE INFORMATION
PARAGRAPH
REFERENCE
Preamble LANDLORD: CalFront Associates, a California
corporation
Preamble TENANT: Giga-tronics Incorporated, a
California corporation
1.3 BUILDING: building located at 4650 Norris
Canyon Road, San Ramon,
California within the project
commonly known as Norris
Technology Center, containing
approximately 96,612 square feet of
rentable area, as shown on the site
plan attached as Exhibit A.
1.4; 2.1 PREMISES: the ground floor premises as
outlined on the floorplan attached as
Exhibit B.
1.5 NET RENTABLE AREA OF PREMISES: approximately 47,397 square feet
1.6 TENANT'S PERCENTAGE SHARE: approximately 49.05% of the Building
approximately 18.76% of the Project
3.1 TERM: ten years
3.1 COMMENCEMENT DATE: later of April 15, 1994 or substantial
completion
3.1 EXPIRATION DATE: expiration of ten years following
Commencement Date
4.1 BASE MONTHLY RENT:
Period of Term Monthly Base Rent
*Commencement Date - Dec. 31, 1994 $29,553 ($0.86 per sq. ft., but with
13,000 sq. ft. rent free)
*Jan. 1, 1995 - Apr 14, 1996 $40,733 ($0.86 per sq. ft.)
*Apr. 15, 1996 - Apr 14, 1999 $49,259 ($1.04 " )
*Apr. 15, 1999 - Apr 14, 2002 $52,574 ($1.11 " )
*Apr. 15, 2002 - end of term $57,310 ($1.21 " )
* Based on estimated Net Rentable Area of 47,364
square feet.
4.3 BASE YEAR: calendar year 1994
20 SECURITY DEPOSIT: $40,000, subject to reduction of
$10,000 each lease anniversary
5.1 PERMITTED USE: office, warehouse, light
manufacturing and assembly, and
uses incidental thereto
2.
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5.2 CC&R's: Covenants, Conditions and
Restrictions of Bishop Ranch
recorded March 26, 1980 in Book
9787 at Pages 803 et seg. of the
Official Records of Contra Costa
County
14 TENANT'S BROKER, IF ANY: Cushman Realty Corporation, a
California corporation
22 LANDLORD'S ADDRESS FOR CalFront Associates
NOTICES: c/o Cushman & Wakefield of
California, Inc.
160 Pine Street, Suite 710
San Francisco, California 94111
Attn: Asset Manager
with a copy to:
Carol Frizzell, Esq.
Pacific Telesis
Legal Department
130 Kearny St., 36th floor
San Francisco, California 94108
22 TENANT'S ADDRESS FOR
NOTICES:
prior to occupancy:
2495 Estand Way
P.O. Box 232015
Pleasant Hill, CA 94523
after occupancy:
to the Premises
24 PARKING: 158 spaces
44, 45 OPTIONS: one 5-year renewal right at 95% of
fair market value
right to expand into vacant space
until April 15, 1998
47 right of first offer
48 cancellation right at any time after
the 7th lease year, if expansion
needs cannot be met
49 MOVING ALLOWANCE: $1 per square foot of Net Rentable
Area
Exhibit C TENANT IMPROVEMENT $20 per square foot of Net Rentable
ALLOWANCE Area
3.
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TABLE OF CONTENTS
Page
----
1. Definitions........................................... 6
2. Premises; Common Areas................................ 7
2.1 Premises..................................... 7
2.2 Common Areas................................. 7
3. Term.................................................. 7
3.1 Term......................................... 7
3.2 Delay in Commencement........................ 8
3.3 Early Possession............................. 8
4. Rent.................................................. 8
4.1 Base Rent.................................... 8
4.2 Additional Rent.............................. 8
4.3 Operating Expenses........................... 8
5. Use................................................... 11
5.1 Use.......................................... 11
5.2 Compliance with Law.......................... 11
5.3 Condition of Premises........................ 12
5.4 Hazardous Substances......................... 12
6. Maintenance, Repairs and Alterations.................. 13
6.1 Landlord's Obligations....................... 13
6.2 Tenant's Obligations......................... 14
6.3 Alterations.................................. 14
7. Indemnity; Insurance.................................. 15
7.1 Indemnity.................................... 15
7.2 Tenant's Insurance........................... 16
7.3 Landlord's Insurance......................... 16
7.4 Payment of Premium........................... 17
7.5 Waiver of Subrogation........................ 17
8. Damage or Destruction................................. 17
8.1 Definitions.................................. 17
8.2 Partial Damage - Insured Loss................ 17
8.3 Partial Damage - Uninsured Loss.............. 17
8.4 Total Destruction............................ 18
8.5 Damage Near End of Term...................... 18
8.6 Abatement of Rent; Tenant's Remedies......... 18
8.7 Termination - Advance Payments............... 19
8.8 Waiver....................................... 19
9. Real Property Taxes................................... 19
9.1 Payment of Tax............................... 19
9.2 Additional Improvements...................... 19
9.3 Definition of Real Property Tax.............. 19
9.4 Joint Assessment............................. 20
9.5 Personal Property Taxes...................... 20
10. Utilities............................................. 20
11. Assignment and Subletting............................. 20
11.1 Landlord's Consent Required.................. 20
11.2 Tenant Affiliate............................. 21
4.
5
11.3 No Release of Tenant......................... 21
11.4 Notice of Assignment or Subletting........... 21
11.5 Condition to Landlord's Consent.............. 21
11.6 Landlord's Expenses.......................... 21
12. Defaults; Remedies.................................... 22
12.1 Defaults..................................... 22
12.2 Remedies..................................... 22
12.3 Default by Landlord.......................... 23
12.4 Late Charges................................. 23
12.5 Landlord's Right to Cure Defaults............ 23
13. Condemnation.......................................... 24
14. Real Estate Brokers................................... 24
15. Estoppel Certificate.................................. 24
16. Landlord's Liability.................................. 24
17. Severability.......................................... 25
18. Interest on Past-de Obligations....................... 25
19. Time of Essence....................................... 25
20. Security Deposit...................................... 25
21. Incorporation of Prior Agreements; Amendments......... 25
22. Notices............................................... 25
23. Waivers............................................... 26
24. Parking............................................... 26
25. Holding Over.......................................... 26
26. Cumulative Remedies................................... 26
27. Binding Effect; Choice of Law......................... 26
28. Subordination......................................... 26
29. Attornment............................................ 27
30. Landlord's Access..................................... 27
31. Signs................................................. 27
32. Merger................................................ 27
33. No Light, Air or View Easement........................ 27
34. Consents.............................................. 27
35. Quiet Possession...................................... 27
36. Landlord's Rules and Regulations...................... 28
37. Security Measures..................................... 28
5.
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38. Landlord's Reservation of Rights...................... 28
38.1 Easements.................................... 28
38.2 Building Rights.............................. 28
39. Authority............................................. 28
40. Conflict.............................................. 28
41. Attorneys' Fees....................................... 28
42. Exhibits.............................................. 29
43. Options............................................... 29
43.1 Options Personal............................. 29
43.2 Effect of Default on Options................. 29
44. Extension Option...................................... 29
45. Extended Term - Rent.................................. 29
46. Expansion Option...................................... 31
47. Right of First Offer.................................. 31
48. Cancellation Right.................................... 32
49. Moving Allowance...................................... 32
EXHIBITS
A Site Plan
B Premises
C Initial Improvements of Premises
D Rules and Regulations
E Rules and Regulations for Tenant Contractors
F CC&R's
G Space to be Subordinated under Expansion Option and Right of First Offer
6.
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THIS LEASE, dated as of December 6, 1993, is made by and between
CalFront Associates, a California corporation (herein called "Landlord") and
Giga-tronics Incorporated, a California corporation (herein called "Tenant").
1. Definitions.
1.1 Base Monthly Rent: The amount specified on Schedule A which
Tenant is to pay each month pursuant to Paragraph 4.1 and subject to adjustment
as provided on Schedule A.
1.2 Commencement Date: The date on which the term of this Lease is
to begin which shall be the date specified in Schedule A, subject to adjustment
pursuant to Paragraphs 3.2 and 3.3.
1.3 Building: The building indicated on Schedule A.
1.4 Premises: That area located within the Building as indicated
on Schedule A.
1.5 Net Rentable Area of Premises: That area comprising the
Premises which is hereby stipulated for all purposes to contain the square
footage indicated on Schedule A, as such square footage may be recalculated
following the initial tenant improvements based on ANSI Publication Z65.1 (1980)
(BOMA standard). The initial determination of Net Rentable Area shall be made by
Landlord's architect following contruction of the initial tenant improvements in
each portion of the Premises. Within thirty (30) days after Tenant takes
possession of each portion of the Premises, Tenant may, at its expense, have its
architect recalculate the Net Rentable Area of the applicable portion of the
Premises. In the event the actual Net Rentable Area of the Demised Premises
differs from the initial calculation of Landlord's architect, the Base Monthly
Rent and all additional charges based on Net Rentable Area shall be
proportionately adjusted as of the Commencement Date to reflect Tenant's actual
Net Rentable Area. Tenant shall pay such rent and additional charges based on
the initial calculation of Landlord's architect pending final determination of
the actual Net Rentable Area. The parties shall execute an instrument
acknowledging the actual Net Rentable Area once it has been finally determined.
1.6 Tenant's Percentage Share: The percentage indicated on
Schedule A. Such Tenant's Percentage Share is derived by dividing the Net
Rentable Area of the Premises by the total rentable area of the Building.
Landlord shall initially calculate Tenant's Percentage Share based on the
initial calculation of Net Rentable Area provided by Landlord in accordance with
Paragraph 1.5 above, subject to later adjustment in the event of a
redetermination of Net Rentable Area of the Premises. Landlord reserves the
right, in the future, to readjust Tenant's Percentage Share to reflect the
addition or removal of improvements to the total space on which expenses passed
through to Tenant will be calculated. Any adjustments will be made on a
reasonable basis and so as not to prejudice Tenant.
1.7 The following terms shall have the meanings specified where
indicated:
a. Additional Rent: Paragraph 4.2
b. Alterations: Paragraph 6.3
c. Common Areas: Paragraph 2.2(a)
d. Expiration Date: Paragraph 3.1
e. Initial Improvements: Paragraph 6.1(b), Exhibit C
f. Insured Loss: Paragraph 8.1(c)
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g. Operating Expenses: Paragraph 4.3(a)
h. Premises Partial Damage; Premises Building Partial Damage:
Paragraph 8.1(a)
i. Premises Total Destruction; Premises Building Total
Destruction: Paragraph 8.1(b)
j. Real Property Tax: Paragraph 9.1
k. Utility Installations: Paragraph 6.3
2. Premises; Common Areas.
2.1 Premises. Landlord hereby leases to Tenant, and Tenant leases
from Landlord the Premises on the terms and conditions set forth herein.
2.2 Common Areas.
(a) As used herein, "Common Areas" shall mean all areas
within the Building and the land upon which it is located which are provided and
designated by Landlord from time to time for the general non-exclusive use of
Landlord, Tenant and other tenants of the Building or the project, including,
without limiting the foregoing, lobbies, corridors, windows, stairways, air
shafts, mechanical shafts, elevators, service and mechanical rooms and closets,
trash facilities, restrooms, entrances, walls and exterior roof, parking areas,
driveways, sidewalks, loading areas, access and egress roads, landscaped and
planted areas and improvements provided by Landlord for the common use of
tenants. The Common Areas shall include an allocable portion of outside areas of
the project. Landlord may from time to time change the size, location, nature
and use of any of the Common Areas, including converting Common Areas into
leasable areas and increasing or decreasing common area land, floor space and/or
facilities; provided, however, that any such change in the Common Areas shall
not unreasonably interfere with Tenant's use and enjoyment of the Premises or
materially decrease the quality or level of Common Area services and facilities.
(b) Tenant, its employees, agents, customers and business
invitees shall have the nonexclusive right (in common with all others to whom
Landlord has granted or may hereafter grant such rights) to use the Common Areas
for the purposes intended, subject to such reasonable rules and regulations
relating to such use as Landlord may from time to time establish. Landlord may
at any time close any Common Areas to effect construction, repairs or changes
thereto, or to prevent the acquisition of public rights in such areas, and
reasonable may do such other acts in and to the Common Areas as in its
reasonable judgment it deems appropriate, so long as reasonable access to the
Premises remains available. Tenant shall not at any time unreasonably interfere
with the rights of Landlord, other tenants, or of any other person entitled to
use the Common Areas, to use any part thereof.
3. Term.
3.1 Term. This Lease shall be for the term specified on Schedule
A, commencing on the Commencement Date specified on such Schedule A, or, if
later, the date upon which the Initial Improvements to be installed by Landlord
are substantially completed and the Premises ready for occupancy or use and
expiring on the Expiration Date specified on such Schedule A unless sooner
terminated pursuant to any provision hereof. The Initial Improvements shall be
deemed to be substantially complete upon the earliest to occur of the following:
(a) the date by which all improvements to be constructed by Landlord have been
completed, except for punch list items which do not prevent Tenant from using
the Premises for their intended use, and the relevant local authority has issued
a certificate of temporary occupancy for the Premises or the equivalent
(provided, however, that the issuance of such local authority approval shall be
deemed to have occurred if denied solely by reason of the failure Tenant's Work
to satisfy local authority requirements), or (b) the date Tenant opens for
business in the Premises. The parties shall, after the Lease Commencement Date
has occurred, execute an instrument specifying the actual Lease Commencement
Date.
8.
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3.2 Delay in Possession. Notwithstanding said Commencement Date,
if for any reason Landlord cannot deliver possession of the Premises to Tenant
on said date, Landlord shall not be subject to any liability therefor, nor shall
such failure affect the validity of this Lease or the obligations of Tenant
hereunder, but, in such case, Tenant shall not be obligated to pay rent until
the initial improvements are substantially complete in accordance with Paragraph
3.1 above, and the Expiration Date shall be automatically extended; provided,
however, that if Landlord shall not have delivered possession of the Premises
within 90 days from said Commencement Date, Tenant may, at Tenant's option, by
notice in writing to Landlord within ten (10) days thereafter, cancel this
Lease, in which event the parties shall be discharged from all obligations
hereunder; provided that such 90-day period shall be subject to extension for
any delays (i) caused by Tenant requests for changes in Landlord's construction,
if any, or due to fault or neglect of Tenant or Tenant's agents or contractors,
or (ii) due to acts of God, strikes, fires, weather, casualty, war, acts of
governmental bodies, inability to obtain labor or materials or other causes
beyond Landlord's reasonable control.
3.3 Early Possession. Subject to any early occupancy for
completion of Tenant's Work as specified in Paragraphs 4.1 and 6.1 of Exhibit C,
if Tenant occupies the Premises prior to said Commencement Date, such occupancy
shall be subject to all provisions hereof, such occupancy shall not advance the
Expiration Date, and Tenant shall pay rent for such period at the initial Base
Monthly Rent set forth in Schedule A for the period following any free rent
period.
4. Rent.
4.1 Base Rent. Tenant shall pay to Landlord, as Base Monthly Rent
for the Premises, the amount specified on Schedule A. Rent shall be payable in
advance, on or before the first day of each month of the term hereof. Rent for
any period during the term hereof which is for less than one month shall be a
pro rata portion of the monthly installment. Rent shall be payable in lawful
money of the United States to Landlord without deduction, offset, prior notice
or demand at the address stated herein or to such other persons or at such other
places as Landlord may designate in writing.
4.2 Additional Rent. As rent for the Premises, in addition to the
Base Monthly Rent, Tenant shall pay to Landlord, in the amounts and at the times
provided, all of the other charges and payments provided for in this Lease
("Additional Rent"), such as (but not limited to) Operating Expenses over the
Base Year (including any insurance premiums payable by Tenant, taxes payable by
Tenant, jointly metered utility charges, common area costs), late charges, and
interest ("Additional Rent"). Unless otherwise specified herein, all payments of
Additional Rent shall be payable in full on the date that the next installment
of Base Monthly Rent is payable.
4.3 Operating Expenses.
(a) Tenant shall pay to Landlord as Additional Rent
Tenant's Percentage Share (as specified on Schedule A) of all Operating Expenses
as hereinafter defined during each calendar year or part thereof during the term
of this Lease over the amount of Operating Expenses paid during the Base Year
specified on Schedule A, in accordance with the following provisions. Subject to
the exclusions in (e) below, "Operating Expenses" shall mean the total cost and
expenses paid or incurred by Landlord in the exercise of its discretion in
connection with the management, operation, maintenance and repair of the
Building, including an allocable proportion of the shared cost and expenses of
Common Areas and other costs of the project as allocated to the Building by
Landlord in its reasonable good faith determination. Such Operating Expenses
shall include, without limitation, (i) the cost of air conditioning,
electricity, heating, mechanical, ventilating, elevator systems and all other
utilities (to the extent not separately charged or metered to Tenant) and the
cost of supplies and equipment and maintenance and service contracts in
connection therewith (to the extent the heating, ventilating, and air
conditioning systems in the Premises are not maintained by Tenant at Tenant's
sole cost); (ii) all costs, charges and fees associated with all water and sewer
service supplied but not separately metered to Tenant and all costs of any other
utility not separately assessed to Tenant; (iii) the cost of watchmen, guards
and security personnel and services; (iv) the cost of repairs (including,
without limitation, roof repairs and
9.
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maintenance and repair of the structural components of the Building), general
maintenance, plumbing service, janitorial and cleaning service, and fire
protection systems; (v) the cost of fire, extended coverage, boiler, sprinkler,
public liability, property damage, rent, earthquake, and other insurance paid by
Landlord; (vi) wages, salaries and other labor costs, including employee
benefits; (vii) fees, charges and other costs, including management fees,
consulting fees, legal fees and accounting fees, of all independent contractors
engaged by Landlord or reasonably charged by Landlord if Landlord performs
management services in connection with the Building or project; (viii) license,
permit and inspection fees; (ix) supplies, materials, tools and equipment and
the cost of supplying, replacing and cleaning employee uniforms; (x) the fair
market rental value of Landlord's or the property manager's offices in any
building used in the management of the Building or Common Areas; (xi) all costs
and expenses of contesting by appropriate legal proceedings any matter
concerning operating or managing the Building or Common Areas; (xii)
depreciation on all personal property, fixtures and equipment used in the
management, operation, maintenance and repair of the Building or Common Areas;
(xiii) all costs associated with the operation, management, maintenance and
repair of the Common Areas, including landscaping and gardening, signs,
maintenance, repairs, resurfacing, repaving, painting, refinishing, lighting,
cleaning, storm drainage and sanitary sewer systems, refuse removal, snow, ice
and ash removal; (xiv) the cost of any capital improvements made to the Building
or project after completion of its construction as a labor-saving device or to
effect other economies in the operation or maintenance of the Building or
project, or made to the Building or project after the date of this Lease that
are required under any governmental law or regulation that was not applicable to
the Building or project at the time that permits for the construction thereof
were obtained, such cost to be amortized over the useful life of the
improvement, provided, however, that in the case of a cost-saving capital
improvement the amortization of the cost of such improvement shall be at a rate
that shall not exceed the actual savings realized by such measure; (xv) the cost
of all Real Property Tax paid by Landlord pursuant to Paragraph 9; (xvi) costs
incurred to test, survey, clean up, contain, abate, remove or otherwise remedy
Hazardous Substances from the Building or project except to the extent caused by
Landlord's negligence or intentional acts or the proven negligence or
intentional acts of any other tenant in the Building; and (xvii) any other
expense of any other kind whatsoever reasonably incurred in managing, operating,
maintaining and repairing the Building or project. Expenses shall be adjusted to
reflect a ninety-five percent (95%) occupancy of the Building. The determination
of Operating Expenses and their allocation shall be in accordance with generally
accepted accounting principles applied on a consistent basis. If the Common
Areas contain more than one building at any time during the Lease term, then the
term "Operating Expenses" shall mean and include all of the Operating Expenses
allocable to the Premises and a proportionate share (based on the square footage
of gross rentable area in the Premises as a percentage of the total of square
footage of gross rentable area of the buildings on the Common Areas at the time
in question) of all Operating Expenses which are related to such buildings in
general and are not allocated to any one building on the Common Areas. The
specific examples of Operating Expenses stated in this Paragraph are in no way
intended to and shall not limit the costs comprising Operating Expenses, nor
shall such examples be deemed to obligate Landlord to incur such costs or to
provide such services or to take such actions except as Landlord may be
expressly required in other portions of this Lease, or except as Landlord, in
its sole discretion, may elect.
(b) Tenant shall pay to Landlord as Additional Rent
during each calendar year or part thereof during the term of this Lease
one-twelfth (1/12th) of Tenant's Percentage Share of the increase in Operating
Expenses over the Base Year for each such calendar year or partial calendar year
on or before the first day of each calendar month, in advance, in an amount
estimated by Landlord and billed by Landlord to Tenant; provided that Landlord
shall have the right initially to determine reasonable monthly estimates and to
revise such estimates from time to time but not more often than twice per
calendar year. With reasonable promptness, but no later than 90 days after the
expiration of each calendar year, Landlord shall furnish Tenant with a statement
(herein called "Landlord's Expense Statement"), setting forth in reasonable
detail the Operating Expenses for such calendar year and Tenant's Percentage
Share, if any, of the increase in such Operating Expenses. If the actual
increase in Operating Expenses for the Building for such calendar year exceed
the estimated increase in Operating Expenses paid by Tenant for such calendar
year, Tenant shall pay to Landlord the difference between the amount paid by
Tenant and the actual increase in
10.
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Operating Expenses within 30 days after the receipt of Landlord's Expense
Statement, and if the total amount paid by Tenant for any such calendar year
shall exceed the actual increase in Operating Expenses for such calendar year,
such excess shall be credited against the next installment of rent, or at the
end of the Term, reimbursed within 30 days of expiration or early termination of
the Lease.
(c) If for any calendar year any tenant of the Building
(including Tenant) is separately metered for any utility, the utility for which
such tenant is separately metered shall not be included in Operating Expenses
for the computation of the Additional Rent to be paid by such tenant for such
calendar year under this Paragraph. In such event, for purposes of computing the
portion of each utility that is separately metered to any tenant to be paid by
the tenants that are not separately metered, Tenant's Percentage Share shall be
the percentage figure obtained by dividing the rentable area of the premises of
each tenant that is not separately metered by the total rentable area of all the
tenants that are not separately metered. In the event any utility is separately
metered for only a portion of any calendar year, such charges shall be prorated
on a daily basis based upon a thirty (30) day month in accordance with the
foregoing formula. Such computations shall be shown on Landlord's Expense
Statement for the applicable calendar year.
(d) If the expiration date fixed for this Lease shall
occur on a date other than the end of a calendar year, Tenant's Percentage Share
of increased Operating Expenses for the calendar year in which the expiration
date falls shall be prorated on an annual basis; provided, however, Landlord
may, pending the determination of the amount of increased Operating Expenses for
such partial calendar year, furnish Tenant with statements of estimated excess
Operating Expenses and Tenant's Percentage Share thereof for such partial
calendar year. Within 30 days after receipt of such estimated statement, Tenant
shall remit to Landlord, as Additional Rent, the amount of Tenant's Percentage
Share of such increase in Operating Expenses. After such Operating Expenses have
been finally determined and Landlord's Expense Statement furnished to Tenant
pursuant to this Paragraph, if there has been an underpayment of Tenant's
Percentage Share of increased Operating Expenses, Tenant shall remit the amount
of such underpayment to Landlord within 30 days of receipt of such statements
and, if there has been an overpayment, Landlord shall remit the amount of any
such overpayment to Tenant within 30 days of the issuance of such statement.
(e) Notwithstanding anything in this Lease to the
contrary, Operating Expenses shall not include the following: (i) legal fees,
brokerage commissions, advertising costs, or other related expenses incurred in
connection with the leasing of the Building or project; (ii) any capital
improvements or alterations, except as expressly provided in (a) above;
provided, however, that structural repairs or improvements costing less than
$25,000 shall not be deemed capital, and that the costs of replacement or repair
of the roof membrane amortized over its useful life may be included in Operating
Expenses; (iii) depreciation or amortization of the Building; (iv) damage and
repairs to the extent covered by the proceeds of any insurance policy carried
by, or required to be carried by, Landlord in connection with the Building,
project or Common Areas; (v) executive salaries; (vi) salaries of service
personnel to the extent that the service personnel perform services not solely
in connection with the management, operation, repair or maintenance of the
Building, project or Common Areas; (vii) Landlord's general overhead expenses
not related to the Building or project; (viii) payments of principal or interest
on any mortgage or other encumbrance; (ix) legal fees, accountants' fees and
other expenses incurred in connection with disputes with Tenant, tenants or
other occupants or associated with the enforcement of any lease or defense of
Landlord's title to or interest in the Building or project to the extent such
defense does not benefit tenants of the Building; (x) costs (including permit,
license and inspection fees) incurred in renovating or otherwise improving,
decorating, painting or altering space for other tenants or other occupants or
vacant space in the Building or project; (xi) interest, penalties or other costs
arising out of Landlord's failure to make timely payment of its obligations;
(xii) the cost of any service provided to Tenant or other occupants of the
Building or project and not to Tenant for which Landlord is to be reimbursed
separately; (xiii) overhead and profit paid to subsidiaries or affiliates of
Landlord for management or other services for the project or Building or for
supplies or other materials to the extent that the costs of the services,
supplies or materials exceed the competitive costs of the services, supplies or
materials if they were not provided by a subsidiary or an affiliate; (xiv)
damage
11.
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and repairs necessitated by the negligence or wilful misconduct of Landlord or
Landlord's employees, contractors or agents; (xv) costs incurred due to a proven
violation by any other tenant in the Building of the terms and conditions of any
lease; (xvi) costs of operating and maintaining any portion of the Building or
Common Areas which is used for parking and for which parking fees are charged;
(xvii) property management fees to the extent they exceed customary and
reasonable charges in the San Ramon/Pleasanton local area; (xviii) costs
incurred in advertising and promotional activities for the Building (including
gifts and promotional services to tenants or other parties); (xix) cost of
capital improvements otherwise permitted to be passed through to Tenant
hereunder in excess of the costs amortized over the useful life of the capital
improvement (for which purposes repair or improvement costs shall be capitalized
if over $25,000 in any one instance and otherwise expensed); and (xx) rent for
space within the Building or other locations other than as expressly permitted
in 4.3(a)(x).
(f) Tenant shall have the right, at Tenant's expense, at
all reasonable times upon ten days' prior written notice within one year
following receipt of Landlord's statements (or, in the case of retroactive
billings, within 12 months following receipt of Landlord's invoice), to audit
Landlord's books and records relating to the Operating Expenses of the Building
for the previous calendar year at the office where Landlord keeps such
documents. If it is determined following such audit that payment adjustments are
required, Landlord or Tenant, as the case may be, shall make the required
payment within 30 days thereafter. In the event such audit reveals that
Landlord's Expense Statement overstated actual Operating Expenses by more than
five percent (5%) for any particular year, Landlord shall reimburse Tenant for
the reasonable cost of such audit.
(g) Landlord shall increase the Operating Expenses paid
or incurred by Landlord during the Base Year to the extent there is a component
of Operating Expenses incurred after the Base Year which (i) was not paid or
incurred in the Base Year; (ii) is not the result of any requirement imposed by
a governmental agency; and (iii) is not approved by Tenant. The amount of the
increase in the Operating Expenses paid or incurred by Landlord during the Base
Year as a result of an additional component of Operating Expenses shall be the
amount which Landlord and Tenant reasonably determine would have been paid or
incurred by Landlord in the Base Year in connection with the additional
component. If increase shall be the amount of the Operating Expense paid in the
first year the additional component is paid (i.e., a year after the Base Year),
reduced by a percentage equal to the percentage increase in the Consumer Price
Index between the Base Year and the first year the component is paid.
5. Use.
5.1 Use.
The Premises shall be used and occupied only for the permitted
use stated on Schedule A and for related purposes.
5.2 Compliance with Law and Restrictions.
(a) Tenant shall comply promptly with all applicable
statutes, ordinances, rules, regulations, orders, easements, covenants and
restrictions of record, and requirements in effect during the term hereof
applicable to the space within the Premises (or resulting from tenant
improvements), regulating the use by Tenant of the Premises, including the
Covenants, Conditions and Restrictions specified on Schedule A, a copy of which
is attached as Exhibit F. The costs of Tenant's compliance shall be borne solely
by Tenant except to the extent the costs (i) relate to any portion of the
Building other than the space leased by Tenant or (ii) result from the failure
of the Premises (other than the tenant improvements constructed by Tenant) to
comply with the applicable statutes, etc., as of the Commencement Date.
Notwithstanding the foregoing, Landlord shall at Landlord's expense be
responsible for complying with the Americans with Disabilities Act as applicable
to the Building and Premises on the Commencement Date. Tenant shall not use nor
permit the use of the Premises in any manner that will tend to create waste or a
nuisance or result in any increase in any insurance premiums payable on
insurance carried on the Premises, or, if there shall be more than one tenant in
the Building containing the Premises, shall tend to disturb such other
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tenants. Tenant shall not cause, maintain or permit any outside storage on or
about the Premises. Tenant shall not conduct nor permit to be conducted any
auction on the Premises without Landlord's prior written consent.
5.3 Condition of Premises.
(a) Landlord shall deliver the Premises to Tenant clean
and free of debris on the Lease Commencement Date (unless Tenant is already in
possession). Except as otherwise provided in this Lease, Tenant shall be deemed
to have accepted the Premises in their "as is" condition existing as of the
Lease Commencement Date or the date Tenant takes possession of the Premises,
whichever is earlier, subject to all applicable zoning, municipal, county and
state laws, ordinances and regulations governing the use of the Premises, and
any covenants or restrictions of record, and accepts this Lease subject thereto
and to all matters disclosed thereby and by any exhibits attached hereto. Tenant
acknowledges that neither Landlord nor any real estate broker or other agent of
Landlord has made any representation or warranty as to the present or future
suitability of the Premises for the conduct of Tenant's business.
(b) Landlord shall have no obligation to construct or
install in the Premises any improvements, fixtures or equipment whatsoever,
except to the extent otherwise provided in Exhibit C attached hereto, if any. By
taking possession of the Premises, Tenant is deemed to have accepted Initial
Improvements to be constructed by Landlord (if any) as being completed in
accordance with the plans and specifications for such improvements, subject only
to completion of items on Landlord's and Tenant's punch list, and except for
patent defects which Tenant identified to Landlord within 30 days of the
Commencement Date and latent defects not reasonably discoverable by Tenant
within such 30-day period.
5.4 Hazardous Substances. Except in compliance with all government
approvals, applicable Laws and regulations pertaining to Hazardous Materials (as
defined below), and in accordance with the additional provisions of this
Paragraph 5.4, Tenant shall not cause or permit the presence, use, handling,
generation, emission, release, discharge, storage or disposal of any Hazardous
Materials on, under, in or about the Premises; and shall not cause or permit the
transportation of any Hazardous Materials to or from the Premises. Tenant shall
indemnify, protect, defend, and hold harmless Landlord from and against all
liability, and foreseeable consequential damages, penalties, expenses and costs
of any required or necessary remediation, repair, removal, cleanup or
detoxification, of the Premises and surrounding properties, and from and against
the preparation of any cleanup, remediation, closure or other required plans,
whether such action is required or necessary prior to or following the
termination of this Lease, to the full extent that the same is attributable to
the presence, use, handling, generation, emission, release, discharge, storage
or disposal of Hazardous Materials by Tenant, its agents, employees, or
contractors. Neither the written consent by Landlord to the handling, use,
presence, generation, emission, release, discharge, storage, or disposal of
Hazardous Materials nor the strict compliance by Tenant with all Laws and
government approvals pertaining to Hazardous Materials shall excuse Tenant from
Tenant's obligations of indemnification pursuant to this Paragraph. Tenant shall
at all times notify Landlord of any Hazardous Materials present, used,
generated, handled, emitted, released, discharged, stored or disposed of on or
from the Premises. Notwithstanding the foregoing, notice shall not be required
for Hazardous Materials present on the Premises in reasonable quantities which
are commonly used in business offices including, but not limited to, cleaning
materials, correcting fluids, and toner used in photocopy machines, provided
such Hazardous Materials are used and disposed of in accordance with law. Tenant
shall also observe any reasonable, additional requirements imposed by Landlord
from time to time in the presence, use, handling, generation, emission, release,
discharge, storage or disposal of Hazardous Materials, and shall institute
operating procedures designed to handle Hazardous Materials consistent with
prudent industry practice. Landlord shall have the right to inspect the Premises
on 24- hours' prior notice for compliance with the provisions of this Paragraph.
If Landlord in its reasonable judgment decides that the manner or extent of
Tenant's activities involving Hazardous Materials so require or that Tenant is
violating its obligations under this Paragraph in its handling of Hazardous
Materials, Landlord may hire an independent expert to develop a Hazardous
Materials program for Tenant and monitor
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Tenant's compliance therewith. Tenant shall reimburse Landlord for the
reasonable cost of such independent consultant promptly upon demand.
The term "Hazardous Materials" shall mean any toxic substance,
hazardous substance, hazardous material, or hazardous waste, pollutant or
contaminant which is or becomes regulated by any local governmental authority,
the State of California, or the United States government, including, but not
limited to, any material or substance which is (i) defined as a "hazardous
waste", "extremely hazardous waste" or "restricted hazardous waste" under
Sections 25115, 25117 or 25122.7, or listed pursuant to Section 25140 of the
California Health and Safety Code, Division 20, Chapter 6.5 (Hazardous Waste
Control Law), (ii) defined as a "hazardous substance" under Section 25316 of the
California Health and Safety Code, Division 20, Chapter 6.8
(Carpenter-Presley-Tanner Hazardous Substance Account Act), (iii) listed as a
chemical known to cause cancer or reproductive toxicity pursuant to Section
25249.8 of the California Health and Safety Code, Division 20, Chapter 6.6 (Safe
Drinking Water and Toxic Enforcement Act), (iv) designated as a "hazardous
substance" pursuant to Section 6380 of the California Labor Code, Division 5,
Chapter 2.5 (Hazardous Substances Information and Training Act); (v) defined as
a "hazardous waste" pursuant to Section 1004 of the Resource Conservation and
Recovery Act, 42 U.S.C. Section 6901 et seq. (42 U.S.C. Section 6903), (vi)
defined as a "hazardous substance" pursuant to Section 101 of the Comprehensive
Environmental Response, Compensation, and Liability Act, 42 U.S.C. Section 9601
et seq. (42 U.S.C. Section 9601), or (vii) defined as a "hazardous material,"
"Hazardous substance," or "hazardous waste" under Section 25501 of the
California Health and Safety Code, Division 20, Chapter 6.95 (Hazardous
Materials Release Response Plans and Inventory), (viii) defined as a "hazardous
substance" under Section 25281 of the California Health and Safety Code,
Division 20, Chapter 6.7 (Underground Storage of Hazardous Substances), (ix)
listed under Article 9 or defined as hazardous or extremely hazardous pursuant
to Article 11 of Title 22 of the California Administrative Code, Division 4,
Chapter 20.
6. Maintenance, Repairs and Alterations.
6.1 Landlord's Obligations.
(a) Subject to the provisions of Paragraphs 5, 6.2 and 8 and,
except for damage caused by any negligent or intentional act or omission of
Tenant, Tenant's agents, employees or invitees, in which event, Tenant shall
repair the damage, Landlord shall keep in good order, condition and repair (i)
the gross structural components of the Premises and the Building, namely the
foundations, subflooring, exterior walls, bearing walls, and structural roof
components; (ii) the Common Areas, including landscaping, driveways, parking
lots, fences and signs located on the Building site and all sidewalks and
parkways adjacent to the Building, (iii) Building systems and utility
installations to the outlets, and (iv) the roof membrane; the expenses of which
shall be recovered from Tenant for Tenant's Percentage Share as specified on
Schedule A to the extent permitted by Paragraph 4.3. In addition, Landlord shall
maintain the heating, ventilation and air conditioning systems serving the
Premises, the expenses of which shall be included in Operating Expenses to the
extent they are for portions of the heating, ventilation and air conditioning
system up to and including the central heating, ventilation and air conditioning
system equipment within Landlord's utility room, and the expenses of which shall
be directly reimbursable by Tenant to the extent they are for portions of the
heating, ventilation and air conditioning system from such utility room and
within the Premises (which would otherwise be Tenant's obligation to maintain
and repair). Landlord shall have no obligation to make repairs under this
Paragraph 6.1 until a reasonable time after receipt of written notice of the
need for such repairs. There shall be no abatement of rent or liability of
Landlord on account of any injury or interference with Tenant's business with
respect to any improvements, alterations or repairs made by Landlord to any part
of the Building or the Premises. Tenant expressly waives the benefit of any
statute now or hereafter in effect which would otherwise afford Tenant the right
to make repairs at Landlord's expense or to terminate this Lease because of
Landlord's failure to keep the Premises in good order, condition and repair.
Notwithstanding the foregoing, if Landlord fails to perform repairs and
maintenance after reasonable notice from Tenant (but in no event less than 30
days), Tenant can repair and invoice Landlord for the actual reasonable cost
therefor for payment within 30 days.
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(b) Landlord shall, prior to the Commencement Date hereof,
construct certain Initial Improvements to the Premises in accordance with
Exhibit C, if any.
6.2 Tenant's Obligations.
(a) Subject to the provisions of Paragraphs 5, 6.1 and 8, Tenant,
at Tenant's expense, shall keep in good order, condition and repair the Premises
and every part thereof (whether or not the damaged portion of the Premises or
the means of repairing the same are reasonably or readily accessible to Tenant)
including, without limiting the generality of the foregoing, any and all
telephone and telecommunications wiring and equipment, fixtures, interior walls,
and interior surface of exterior walls, ceilings, windows, doors, plate glass,
showcases, skylights and entrances located within the Premises, and the
electrical, plumbing, lighting, heating and air conditioning systems (unless
Landlord has elected to keep and maintain the heating, ventilation and air
conditioning systems pursuant to Paragraph 6.1).
(b) If Tenant fails to perform Tenant's obligations under this
Paragraph 6.2 or under any other Paragraph of this Lease, Landlord may, at
Landlord's option, enter upon the Premises after ten (10) days' prior written
notice to Tenant (except in the case of emergency, in which case no notice shall
be required), to perform such obligations on Tenant's behalf and put the
Premises in good order, condition and repair, and the cost thereof together with
interest thereon from the date of Landlord's expenditure at the rate specified
in Paragraph 18 shall be due and payable as Additional Rent to Landlord within
30 days following Landlord's invoice to Tenant.
(c) On the Expiration Date of the term hereof, or on any earlier
termination, Tenant shall surrender the Premises to Landlord in the same
condition as received, clean and free of debris, ordinary wear and tear
excepted. Any damage or deterioration of the Premises shall not be deemed
ordinary wear and tear if the same could have been avoided by good maintenance
practices by Tenant. Tenant shall repair any damage to the Premises, occasioned
by the installation or removal of its trade fixtures, furnishings and equipment.
Notwithstanding anything to the contrary stated in this Lease, Tenant shall
leave the air lines, power panels, electrical distribution systems, lighting
fixtures, space heaters, heating and air conditioning systems, window coverings,
wall coverings, carpets, panelling, ceilings, and plumbing on the Premises in
good order and operating condition.
6.3 Alterations.
(a) Tenant shall not, without Landlord's prior written consent
(which shall not be unreasonably withheld or delayed), make any Alterations or
Utility Installations or repairs in, on or about the Premises or attach any
fixtures or equipment thereto, except for interior decorative and nonstructural
Alterations exceeding $20,000 in any instance during the term of this Lease. As
used in this Paragraph 6.3, the term "Alterations" shall mean any alterations,
additions, improvements, construction, maintenance, repair, replacement,
installation, removal or decoration undertaken by Tenant in connection with the
Premises. The term "Utility Installations" shall mean carpeting, window and wall
coverings, air lines, power panels, electrical distribution systems, lighting
fixtures, space heaters, air conditioning, plumbing, and telephone and
telecommunications wiring and equipment and any other system. Landlord may
require that Tenant remove any or all of said Alterations or Utility
Installations installed after Tenant's initial occupancy, at the expiration of
the term, and restore the Premises to their prior condition, provided that
Landlord notifies Tenant at the time Landlord consents to their installation
that it reserves the right to require their removal. Should Tenant make any
Alterations or Utility Installations without the prior approval of Landlord,
Landlord may require that Tenant remove any and all of the same.
(b) Any Alterations or Utility Installations in, on or about the
Premises that Tenant shall desire to make and which requires the consent of the
Landlord shall be presented to Landlord in written form, with complete plans and
specifications. If Landlord shall give its consent, the consent shall be deemed
conditioned upon Tenant acquiring a permit to do so from appropriate
governmental agencies, the furnishing of a copy thereof to
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Landlord prior to the commencement of the work and the compliance by Tenant with
all conditions of said permit in a prompt and expeditious manner. The contractor
or person selected by Tenant to make such Alterations or Utility Installations
must be approved in writing by Landlord (such approval not to be unreasonably
withheld, conditioned, or delayed) prior to commencement of any work, and such
contractor or person shall, at all times, be subject to Landlord's control while
in the Building and shall comply with Landlord's Rules and Regulations for
Tenant Contractors, the current version of which is attached hereto as Exhibit
E. Tenant shall also require its contractor to maintain insurance in amounts and
in such form as Landlord may reasonably require and naming Landlord as an
additional insured. Any Alterations or Utility Installations shall be completed
in substantial accordance with the plans and specifications approved by
Landlord, shall be carried out in a good, workmanlike and prompt manner, shall
be of good and sufficient quality and materials, shall comply with all
applicable laws and shall be subject to reasonable supervision by Landlord or
its authorized representatives. Without Landlord's prior written consent, which
shall not be unreasonably withheld, Tenant shall not use any portion of the
Common Areas in connection with the making of any Alterations or Utility
Installations. Should any Alterations or Utility Installations on the Premises
by Tenant interfere with the harmonious labor relations in existence in the
Building, Tenant shall take all reasonable steps to halt such interference,
including, if necessary, cessation of the work.
(c) Tenant shall pay, when due, all claims for labor or materials
furnished or alleged to have been furnished to or for Tenant at or for use in
the Premises, which claims are or may be secured by any mechanics' or
materialmen's lien against the Premises or any interest therein. Tenant shall
give Landlord not less than fifteen (15) days' notice prior to the commencement
of any work in the Premises, and Landlord shall have the right to post notices
of non-responsibility in or on the Premises as provided by law. If Tenant shall,
in good faith, contest the validity of any such lien, claim or demand, then
Tenant shall, at its sole expense, defend itself and Landlord against the same
and shall pay and satisfy any adverse judgment that may be rendered thereon
before the enforcement thereof against the Landlord or the Premises, upon the
condition that if Landlord shall require, Tenant shall furnish to Landlord a
surety bond satisfactory to Landlord in an amount equal to such contested lien,
claim or demand indemnifying Tenant against liability for the same and holding
the Premises free from the effect of such lien or claim. In addition, Landlord
may require Tenant to pay Landlord's attorneys' fees and costs in participating
in such action if Landlord shall decide it is to its best interest to do so.
(d) Unless Landlord requires their removal, as set forth in
Paragraph 6.3(a), all Alterations and Utility Installations (whether or not they
constitute trade fixtures of Tenant) which may be made on the Premises,
including but not limited to the floor coverings, panelings, doors, drapes,
built-ins, moldings, soundproofing and lighting and telephone or communications
systems, conduit, wiring and outlets, shall become the property of Landlord and
remain upon and be surrendered with the Premises at the expiration of the term.
Notwithstanding the provisions of this Paragraph 6.3(d), Tenant's machinery and
equipment, other than that which is affixed to the Premises so that it cannot be
removed without material damage to the Premises, shall remain the property of
Tenant and may be removed by Tenant subject to the provisions of Paragraph
6.2(a).
(e) Tenant shall provide Landlord with as-built plans and
specifications for any Alterations or Utility Installations.
7. Indemnity; Insurance.
7.1 Indemnity.
(a) Tenant shall indemnify and hold harmless Landlord from and
against any and all claims to the extent arising from Tenant's use or occupancy
of the Premises, or from the conduct of Tenant's business or from any activity,
work or things done, permitted or suffered by Tenant in, on or about the
Premises other than claims to the extent arising primarily by reason of
negligence or wilful acts of third parties or of Landlord, its agent, employees
or contractors, and shall further indemnify and hold harmless Landlord from and
against any and all claims to the extent arising from any breach or default in
the performance
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of any obligation on Tenant's part to be performed under the terms of this
Lease, or arising from the negligent or intentional acts or omissions of the
Tenant, or any of Tenant's agents, contractors, or employees, and from and
against all costs, attorneys' fees, expenses and liabilities incurred in the
defense of any such claim or any action or proceeding brought thereon; and in
the case of any action or proceeding brought against Landlord by reason of any
such claim, Tenant upon notice from Landlord shall defend the same at Tenant's
expense by counsel satisfactory to Landlord. Tenant, as a material part of the
consideration to Landlord, hereby assumes all risk of injury to Tenant's
business, loss of income, damage to property or injury to persons, in, on or
about the Premises arising from any cause and Tenant hereby waives all claims in
respect thereof against Landlord.
(b) Landlord shall defend, indemnify, hold and save Tenant harmless
from and against any and all loss, costs, claims, liability or damage (including
reasonable attorneys' fees or court costs) in connection with Landlord's
ownership and management of the Premises, Building and project other than claims
arising primarily by reason of the wilful misconduct or negligence of third
parties or of Tenant, or Tenant's officers, contractors, agents or employees.
7.2 Tenant's Insurance. During the term of this Lease, Tenant shall at
Tenant's expense, obtain and keep in force the following policies of insurance:
(a) Comprehensive General Liability Insurance protecting Tenant
against any liability for injury or death to any person or persons or damage to
property arising out of Tenant's exclusive use, occupancy or maintenance of the
Premises. The limits of such liability insurance shall not be less than Two
Million Dollars ($2,000,000.00) combined single limit per occurrence, such limit
to be increased upon Landlord's request whenever Landlord reasonably determines
that such an increase is required adequately to protect Landlord from the
matters insured against.
(b) All-Risk Property Insurance covering loss or damage to Tenant's
fixtures, equipment or tenant improvements. All insurance required under this
Paragraph 7.2 shall be written on an occurrence basis and be (i) issued by such
good and responsible companies qualified to do and doing business in the state
where the Premises are located and with a Best's rating of B+XI or better, and
(ii) name Landlord as a named additional insured by an additional insured
endorsement. Tenant shall deliver to Landlord certificates evidencing the
existence and amounts of insurance required above and, if requested by Landlord,
copies of the insurance policies. No such policy shall be cancellable or subject
to reduction of coverage except upon thirty (30) days' written notice to
Landlord. Tenant shall, within thirty (30) days of expiration of such policies,
furnish Landlord with certificates of renewal or "binders" therefor.
7.3 Landlord's Insurance. Landlord shall, at Tenant's expense, obtain
and keep in force during the term of this Lease the following insurance:
(a) Comprehensive General Liability Insurance covering bodily
injury and property damage liabilities arising out of the Landlord's ownership,
use, occupancy or maintenance of the Premises and all areas appurtenant thereto
in an amount not less than Two Million Dollars ($2,000,000.00) combined single
limit per occurrence.
(b) Property Insurance covering loss or damage to the Building, but
not Tenant's fixtures, equipment or tenant improvements in an amount not less
than 80% of the full replacement value thereof, as the same may exist from time
to time, providing protection against all perils included within the
classification "all risk," as such term is used in the insurance industry,
including vandalism and malicious mischief, but excluding flood or earthquake
coverage unless required by a lender having a lien on the Premises. In addition,
Landlord may obtain and keep in force during the term of this Lease, a policy of
rental value insurance covering a period of one year, with loss payable to
Landlord, which insurance shall also cover all real estate taxes and insurance
costs for said period.
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(c) Such other insurance (including flood or earthquake coverage)
as Landlord reasonably deems necessary and prudent.
7.4 Payment of Premium. Tenant shall pay to Landlord during the term
hereof, as Additional Rent, Tenant's Percentage Share of the increase over the
Base Year of premiums for the insurance required under Paragraph 7.3, in
accordance with Paragraph 4.3.
7.5 Waiver of Subrogation. Landlord and Tenant each hereby release and
relieve the other, and waive their entire right of recovery against the other
for loss or damage arising out of or incident to risks insured against under all
policies of fire and extended coverage, public liability, workers' compensation
and other insurance now or hereafter existing during the term hereof and
covering any portion of the Premises or any operations therein, regardless of
cause, including negligence of the other party, its agents, employees and
contractors. Landlord and Tenant shall, upon obtaining the policies of insurance
required hereunder, advise each insurance carrier that the foregoing mutual
waiver of subrogation is contained herein, and each party covenants that no
insurer shall hold any right of subrogation against such other party.
8. Damage or Destruction.
8.1 Definitions.
(a) "Premises Partial Damage" shall herein mean damage or
destruction to the Premises to the extent that the cost of repair is less than
fifty percent (50%) of the fair market value of the Premises immediately prior
to such damage or destruction. "Premises Building Partial Damage" shall herein
mean damage or destruction to the Building of which the Premises are a part to
the extent that the cost of repair is less than fifty percent (50%) of the fair
market value of such Building as a whole immediately prior to such damage or
destruction.
(b) "Premises Total Destruction" shall herein mean damage or
destruction to the Premises to the extent that the cost of repair is fifty
percent (50%) or more of the fair market value of the Premises immediately prior
to such damage or destruction. "Premises Building Total Destruction" shall
herein mean damage or destruction to the Building of which the Premises are a
part to the extent that the cost of repair is fifty percent (50%) or more of the
fair market value of such Building as a whole immediately prior to such damage
or destruction.
(c) "Insured Loss" shall herein mean damage or destruction which
was caused by an event required to be covered by the insurance described in
Paragraph 7.3(b).
8.2 Partial Damage - Insured Loss. Subject to the provisions of
Paragraphs 8.4, 8.5 and 8.6, if at any time during the term of this Lease there
is damage which is an Insured Loss and which falls into the classification of
Premises Partial Damage or Premises Building Partial Damage, then Landlord
shall, at Landlord's sole cost, repair such damage to the Building, and Tenant,
at Tenant's sole cost, shall repair and restore Tenant's fixtures, equipment or
tenant improvements, as soon as reasonably possible, and this Lease shall
continue in full force and effect.
8.3 Partial Damage - Uninsured Loss. Subject to the provisions of
Paragraphs 8.4, 8.5, and 8.6, if at any time during the term of this Lease there
is damage which is not an Insured Loss and which falls within the classification
of Premises Partial Damage or Premises Building Partial Damage, unless caused by
a negligent or willful act of Tenant (in which event Tenant shall make the
repairs at Tenant's expense), Landlord may, at Landlord's option, either (i)
repair such damage as soon as reasonably possible at Landlord's expense, in
which event this Lease shall continue in full force and effect with rent
abatement during the period from the occurrence of the damage to the date of the
restoration, or (ii) give written notice to Tenant within sixty (60) days after
the date of the occurrence of such damage of Landlord's intention to cancel and
terminate this Lease, as of the date of the occurrence of such damage. In the
event this Lease does not terminate, Landlord shall repair and restore all
portions of the Building and the Premises, excluding Tenant's fixtures,
equipment and
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Tenant improvements, which Tenant shall repair and restore at Tenant's sole
cost. In the event Landlord elects to give such notice of Landlord's intention
to cancel and terminate this Lease, Tenant shall have the right within ten (10)
days after the receipt of such notice to give written notice to Landlord of
Tenant's intention to repair such damage at Tenant's expense, without
reimbursement from Landlord, in which event, this Lease shall continue in full
force and effect, and Tenant shall proceed to make such repair as soon as
reasonably possible. If Tenant does not give such notice within such ten (10)
day period, this Lease shall be cancelled and terminated as of the date of the
occurrence of such damage.
8.4 Total Destruction. If at any time during the term of this Lease
there is damage, whether or not an Insured Loss (including destruction required
by any authorized public authority) which falls into the classification of
Premises Total Destruction or Premises Building Total Destruction, Landlord may,
at Landlord's option, either (i) repair such damage as soon as reasonably
possible at Landlord's expense, in which event, this Lease shall continue in
full force and effect with rent abatement during the period from the occurrence
of the damage to the date of the restoration, or (ii) give written notice to
Tenant within sixty (60) days after the date of the occurrence of such damage of
Landlord's intention to cancel and terminate this Lease as of the date of the
occurrence of such damage. In the event this Lease does not terminate, Landlord
shall repair and restore all portions of the Building and the Premises,
excluding Tenant's fixtures, equipment and Tenant improvements, which Tenant
shall repair and restore at Tenant's sole cost.
8.5 Damage Near End of Term.
(a) If at any time during the last six (6) months of the term of
this Lease there is material damage, whether or not an Insured Loss, which falls
within the classification of Premises Partial Damage, either party may, at its
option, cancel and terminate this Lease as of the date of occurrence of such
damage by giving written notice to the other party of its election to do so
within thirty (30) days after the date of occurrence of such damage.
(b) Notwithstanding Paragraph 8.5(a), in the event that Tenant has
an option to extend or renew this Lease, and the time within which said option
may be exercised has not yet expired, Tenant shall exercise such option, if it
is to be exercised at all, no later than twenty (20) days after the occurrence
of an Insured Loss falling within the classification of Premises Partial Damage
during the last six (6) months of the term of this Lease. If Tenant duly
exercises such option during said twenty (20) day period, Landlord shall, at
Landlord's expense, repair such damage as soon as reasonably possible, and this
Lease shall continue in full force and effect. If Tenant fails to exercise such
option during said twenty (20) day period, then Landlord may, at Landlord's
option, terminate and cancel this Lease as of the expiration of said twenty (20)
day period by giving written notice to Tenant of Landlord's election to do so
within ten (10) days after the expiration of said twenty (20) day period,
notwithstanding any term or provision in the grant of option to contrary.
8.6 Abatement of Rent; Tenant's Remedies.
(a) In the event of damage described in Paragraphs 8.2 or 8.3, and
Landlord or Tenant repairs or restores the Premises pursuant to the provisions
of this Paragraph 8, the rent payable hereunder for the period during which such
damage, repair or restoration continues shall be abated in proportion to the
area of the Premises unusable for the period from occurrence of the damage to
the date of the restoration. Except for abatement of rent, if any, Tenant shall
have no claim against Landlord for any damage suffered by reason of such damage,
destruction, repair or restoration; provided, however, that nothing shall
restrict Tenant's ability to pursue recovery from Tenant's insurer(s).
(b) If Landlord shall be obligated to repair or restore the
Premises under the provisions of this Paragraph 8 and such restoration and
repair is not reasonably estimated to be capable of completion within 180 days
after the damage or destruction or if Landlord shall not commence preparations
for such repair or restoration within ninety (90) days after such obligations
shall accrue, Tenant may, at Tenant's option, cancel and terminate this Lease by
giving Landlord written notice of Tenant's election to do so at any time within
20
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days after Landlord notifies Tenant that (i) the restoration period will exceed
180 days or (ii) the end of the 90-day period, provided Landlord has not
completed the repair or restoration before Tenant gives Landlord such notice. In
such event, this Lease shall terminate as of the date of such notice.
8.7 Termination - Advance Payments. Upon termination of this Lease
pursuant to this Paragraph 8, an equitable adjustment shall be made concerning
advance rent and any advance payments made by Tenant to Landlord. Landlord
shall, in addition, return to Tenant so much of Tenant's security deposit as has
not theretofore been applied by Landlord.
8.8 Waiver. Landlord and Tenant waive the provisions of any statutes
which relate to termination of leases when leased property is destroyed and
agree that such event shall be governed by the terms of this Lease.
9. Real Property Taxes.
9.1 Payment of Tax. Landlord shall pay the Real Property Tax, as
defined in Paragraph 9.3, applicable to the Building and the land upon which it
is located; provided, however, that Tenant shall pay, as an item of Operating
Expenses, Tenant's Percentage Share of the increase in such Real Property Tax
over that in the Base Year, in the manner provided for Operating Expenses in
Paragraph 4.3, or, at Landlord's election, within thirty (30) days after receipt
of Landlord's written statement setting forth the amount of such pro rata share.
If the term of this Lease shall not expire concurrently with the expiration of
the tax fiscal year, Tenant's liability for taxes for the last partial lease
year shall be prorated on an annual basis.
9.2 Additional Improvements. Notwithstanding Paragraph 9.1 hereof,
Tenant shall pay to Landlord within thirty (30) days of receipt of Landlord's
demand therefor the entirety of any increase in Real Property Tax if assessed
solely by reason of additional improvements placed upon the Premises by Tenant
or at Tenant's request.
9.3 Definition of Real Property Tax. As used herein, the term "Real
Property Tax" shall include (to the extent any of the following are not paid by
Tenant pursuant to Paragraphs 9.2 and 9.5) any form of real estate tax or
assessment, general, special, ordinary or extraordinary, any service payments in
lieu of taxes, any personal property taxes, sales and/or use taxes, employee
taxes, and any excises, license fee, commercial rental tax, improvement bond or
bonds, transit charges, housing fund assessments or other housing charges,
parking facilities assessments or other parking charges, environmental
surcharges, levy or tax, foreseen or unforeseen (other than inheritance,
personal income or estate taxes) imposed on the Premises and/or Common Areas by
any authority having the direct or indirect power to tax, including any city,
state or federal government, or any school, agricultural, sanitary, fire,
street, drainage or other improvement district thereof, as against any legal or
equitable interest of Landlord in the Premises or in the real property of which
the Premises are a part, as against Landlord's right to rent or other income
therefrom, and as against Landlord's business of leasing the Premises. The term
"Real Property Tax" shall also include any tax, fee, levy, assessment or charge
(i) in substitution of, partially or totally, any tax, fee, levy, assessment or
charge hereinabove included within the definition of Real Property Tax, or (ii)
the nature of which was hereinbefore included within the definition of Real
Property Tax, or (iii) all other governmental, quasi-governmental or special
district impositions of any kind, present or future, whether or not customary or
within the contemplation of the parties hereto and regardless of whether
resulting from increased rate and/or valuation, or (iv) which is imposed as a
result of a transfer, either partial or total, of Landlord's interest in the
Premises and/or Common Areas or which is added to a tax or charge hereinbefore
included within the definition of Real Property Tax by reason of such transfer,
or (v) which is imposed by reason of this transaction, any modifications or
changes hereto, or any transfers hereof, and any interest or penalty charged on
account of any such Real Property Tax. Real Property Tax shall also include
Landlord's cost of contesting by appropriate proceedings the amount or validity
of any such taxes. Notwithstanding the foregoing, Real Property Tax shall not
include: (i) estate, inheritance, gift, Landlord's corporate franchise or
Landlord's net income taxes; (ii) taxes assessed by reason of overstandard
tenant improvements in the Building; (iii) gross receipts taxes; nor (iv) any
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increase in Real Property Tax due to a reassessment of the property following a
change of ownership by CalFront Associates during the initial five years of the
Term, provided, however, that at its option, in lieu of excluding such sums from
the definition of Real Property Tax, Landlord may pay Tenant the net present
value of such sum (discounted at the federal discount rate) at the time of the
reassessment.
9.4 Joint Assessment. If the Building and the Common Areas are not
separately assessed, Tenant's liability shall be an equitable proportion of the
Real Property Tax for all of the land and improvements included within the tax
parcel(s) assessed, such proportion to be determined by Landlord from the
respective valuations assigned in the assessor's worksheets or such other
information as may be reasonably available. Landlord's reasonable determination
thereof, in good faith, shall be conclusive.
9.5 Personal Property Taxes.
(a) Tenant shall pay, prior to delinquency, all taxes assessed
against and levied upon trade fixtures, furnishings, equipment and all other
personal property of Tenant contained in the Premises. When possible, Tenant
shall cause said trade fixtures, furnishings, equipment and all other personal
property to be assessed and billed separately from the real property of
Landlord.
(b) If any of Tenant's said personal property shall be assessed
with Tenant's real property, Tenant shall pay Landlord the taxes attributable to
Tenant within 30 days after receipt of a written statement setting forth the
taxes applicable to Tenant's property.
10. Utilities and Services.
(a) Tenant shall pay for all gas, heat, light, power, telephone and
other utilities and services supplied to the Premises, together with any taxes
thereon. If such services are not separately metered to Tenant, Tenant shall pay
a reasonable proportion of all charges jointly metered with other premises; such
amount to be determined in good faith by Landlord. Tenant shall also contract
separately for and pay the cost of all janitorial services to the Premises.
(b) Any heating, ventilation and air conditioning service provided by
Landlord to Tenant during other than ordinary business hours shall be furnished
on 24 hours' prior written notice of Tenant and at Tenant's sole cost, which
shall be an amount equal to Landlord's actual cost of supplying HVAC systems to
the HVAC systems zone of which the Premises form a part (consisting of (i)
Landlord's actual out-of-pocket third party costs; (ii) reasonable repair and
maintenance costs; and (iii) reasonable charge for depreciation) not to exceed
$35 per hour in the first year of the Term.
11. Assignment and Subletting.
11.1 Landlord's Consent Required. Tenant shall not voluntarily or by
operation of law assign, transfer, mortgage, sublet, or otherwise transfer or
encumber all or any part of Tenant's interest in this Lease or in the Premises,
without Landlord's prior written consent, which shall not be unreasonably
withheld or delayed. Any attempted assignment, transfer, mortgage, encumbrance
or subletting without such consent shall be voidable and shall, at Landlord's
option, constitute a breach of this Lease that entitles Landlord to terminate
this Lease. Tenant agrees that the instrument by which any assignment or
subletting consented to by Landlord is accomplished shall be in a form
satisfactory to Landlord and shall expressly provide that the assignee or
subtenant will perform and observe all the agreements, covenants, conditions and
provisions to be performed and observed by Tenant under this Lease as and when
performance and observance is due, and that Landlord will have the right to
enforce such agreements, covenants, conditions and provisions directly against
such assignee or subtenant. Any subtenant shall, by reason of entering into a
sublease under this Lease, be deemed, for the benefit of Landlord, to have
assumed and agreed to conform and comply with each and every obligation of
Tenant hereunder, other than such obligations as
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are contrary to provisions contained in a sublease to which Landlord has
expressly consented in writing.
11.2 Tenant Affiliate. Notwithstanding the provisions of Paragraph 11.1
hereof, Tenant may assign or sublet the Premises, or any portion thereof,
without Landlord's consent, to any corporation which wholly controls, is
controlled by or is under common control with Tenant, or to any corporation
resulting from the merger or consolidation with Tenant, or to any person or
entity which acquires all the assets of Tenant as a going concern of the
business that is being conducted on the Premises, provided that said assignee
assumes, in full, the obligations of Tenant under this Lease. Any such
assignment shall not, in any way, affect or limit the liability of Tenant under
the terms of this Lease.
11.3 No Release of Tenant. Regardless of Landlord's consent, no
subletting or assignment shall release Tenant of Tenant's obligation or alter
the primary liability of Tenant to pay the rent and to perform all other
obligations to be performed by Tenant hereunder, whether accruing before or
after such subletting or assignment, except as provided in Paragraph 11.6 below.
The acceptance of rent by Landlord from any other person shall not be deemed to
be a waiver by Landlord of any provision hereof. Consent to one assignment or
subletting shall not be deemed consent to any subsequent assignment or
subletting. In the event of default by any assignee of Tenant or any successor
of Tenant in the performance of any of the terms hereof, Landlord may proceed
directly against Tenant without the necessity of exhausting remedies against
said assignee. Landlord may consent to subsequent assignments or subletting of
this Lease or amendments or modifications to this Lease with assignees of Tenant
without notifying Tenant or any successor of Tenant, and without obtaining its
or their consent thereto, and such action shall not relieve Tenant of liability
under this Lease.
11.4 Notice of Assignment or Subletting. Before entering into any
assignment of this Lease or into a sublease of all or a part of the Premises for
which Landlord's consent is required hereunder, Tenant shall give written notice
to Landlord (a) identifying the intended assignee or subtenant by name and
address, (b) describing the nature of the proposed business to be carried on in
the Premises, (c) specifying the terms of the intended assignment or sublease,
and (d) providing such financial and other business information as Landlord may
reasonably request concerning the proposed assignee or subtenant (including,
without limitation, a bank reference and financial statements for the two most
recently completed fiscal years). Landlord shall respond to Tenant's request for
consent within ten business days of submission of all requested information.
Failure of Landlord to respond within the ten business day period shall be
deemed a consent by Landlord to the request.
11.5 Condition to Landlord's Consent. As a condition to Landlord's
consent to any assignment or subletting, Landlord shall be entitled to receive,
in the case of a subletting, 50% of the rent (however denominated and paid)
payable by the subtenant to Tenant in excess of that payable by Tenant to
Landlord hereunder and, in the case of an assignment, 50% of the consideration
given, directly or indirectly, by the assignee to Tenant in connection with such
assignment, after Tenant has first recovered its unamortized costs of tenant
improvements in the Premises (amortized over the remainder of the then-current
Term) and any direct costs incurred by it in such assignment or sublease such as
brokerage commissions and tenant improvements made for the sublessee or
assignee. For purposes of this Paragraph, the term "rent" shall mean all
consideration paid or given, directly or indirectly, for the use of the Premises
or any portion thereof. The term "consideration" shall mean and include money,
services, property or any other thing of value such as payment of costs,
cancellation of indebtedness, discounts, rebates and the like. The rent or other
consideration which is to be passed through to Landlord by Tenant pursuant to
this Paragraph shall be paid to Landlord promptly upon receipt by Tenant and
shall be paid in cash, irrespective of the form in which received by Tenant from
any subtenant or assignee. If any rent or other consideration received by Tenant
from a subtenant or assignee is in a form other than cash, Tenant shall pay to
Landlord in cash the fair value of such consideration.
11.6 Landlord's Expenses. In the event Tenant shall assign or sublet
the Premises or request the consent of Landlord to any assignment or subletting,
then Tenant shall pay
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Landlord's reasonable costs and direct expenses incurred in connection
therewith, not to exceed $1,000, including, without limitation, attorneys' fees,
and Landlord may condition its consent on the payment thereof.
12. Defaults; Remedies.
12.1 Defaults. The occurrence of any one or more of the following
events shall constitute a material default and breach of this Lease by Tenant:
(a) the abandonment of the Premises by Tenant; providing that the
Premises shall not be deemed abandoned if vacated in such a manner that the
Premises are properly secured and Landlord's insurance premiums do not increase;
(b) the failure by Tenant to make payment of Base Monthly Rent,
Additional Rent, or any other payment required to be made by Tenant hereunder,
as and when due, where such failure shall continue for a period of ten days
after written notice thereof from Landlord to Tenant;
(c) the failure by Tenant to observe or perform any of the
covenants, conditions or provisions of this Lease to be observed or performed by
Tenant, other than described in Subparagraph (b) or (f), where such failure
shall continue for a period of 30 days after written notice thereof from
Landlord to Tenant; provided, however, that if the nature of Tenant's default is
such that more than 30 days are reasonably required for its cure, then Tenant
shall not be deemed to be in default if Tenant commences such cure within said
30-day period and thereafter diligently prosecutes such cure to completion;
(d) (i) the making by Tenant of any general arrangement or
assignment for the benefit of creditors; (ii) Tenant's becoming a "debtor" as
defined in 11 U.S.C. Section 101 or any successor statute thereto (unless, in
the case of a petition filed against Tenant, the same is dismissed within 60
days); (iii) the appointment of a trustee or receiver to take possession of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where possession is not restored to Tenant within 30
days; or (iv) the attachment, execution or other judicial seizure of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this lease, where such seizure is not discharged within 30 days. In
the event that any provision of this Paragraph 12.1(d) is contrary to any
applicable law, such provision shall be of no force or effect.
(e) The discovery by Landlord that any financial statement given
to Landlord by Tenant, any assignee of Tenant, any subtenant of Tenant, any
successor in interest of Tenant or any guarantor of Tenant's obligations
hereunder, and any of them, was materially false, if Tenant (or its assignee or
subtenant) knows that such financial information is false.
(f) An assignment, subletting or other transfer or attempted
transfer in violation of Paragraph 11.
12.2 Remedies. In the event of any such material default or breach by
Tenant, Landlord may at any time thereafter, with or without notice or demand
and without limiting Landlord in the exercise of any right or remedy which
Landlord may have by reason of such default or breach:
(a) Terminate Tenant's right to possession of the Premises by any
lawful means, in which case, this Lease shall terminate, and Tenant shall
immediately surrender possession of the Premises to Landlord. In such event,
Landlord shall be entitled to recover from Tenant all damages incurred by
Landlord by reason of Tenant's default, including, but not limited to, (i) the
cost of recovering possession of the Premises; (ii) expenses of reletting,
including necessary renovation and alteration of the Premises, reasonable
attorneys' fees, and any real estate commission actually paid; (iii) the worth
at the time of the award by the court having jurisdiction thereof of the unpaid
rent earned at the time of termination of Tenant's right to possession of the
Premises; (iv) the worth at the time of the award of the amount by which the
unpaid rent that would have been earned after the date of termination of
Tenant's
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right to possession until the time of award exceeds the amount of the loss of
rent for the same period that Tenant proves could be reasonably avoided; (v) the
worth at the time of award of the amount by which the unpaid rent for the
balance of the term after the time of such award exceeds the amount of such
rental loss for the same period that Tenant proves could be reasonably avoided;
and (vi) that portion of any leasing commission paid by Landlord applicable to
the unexpired term of the Lease.
(b) Maintain Tenant's right to possession in which case this Lease
shall continue in effect whether or not Tenant shall have abandoned the
Premises. In such event, Landlord shall be entitled to enforce all of Landlord's
rights and remedies under this Lease, including the right to recover the rent as
it becomes due hereunder.
(c) Pursue any other remedy now or hereafter available to Landlord
under the laws or judicial decisions of the state wherein the Premises are
located. Unpaid installments of rent and other unpaid monetary obligations of
Tenant under the terms of this Lease shall bear interest from the date due at
the rate specified in Paragraph 18.
12.3 Default by Landlord. Landlord shall not be in default unless
Landlord fails to perform obligations required of Landlord within a reasonable
time but, in no event, later than thirty (30) days after written notice by
Tenant to Landlord, specifying where Landlord has failed to perform such
obligation; provided, however, that if the nature of Landlord's obligation is
such that more than thirty (30) days are required for performance, then Landlord
shall not be in default if Landlord commences performance within such thirty
(30) day period and thereafter diligently prosecutes the same to completion.
12.4 Late Charges. Tenant hereby acknowledges that late payment by
Tenant to Landlord of rent and other sums due hereunder will cause Landlord to
incur costs not contemplated by this Lease, the exact amount of which will be
extremely difficult to ascertain. Such costs include, but are not limited to,
processing and accounting charges, and late charges which may be imposed on
Landlord by the terms of any mortgage or deed of trust covering the Premises.
Accordingly, if any installment of rent or any other sum due from Tenant shall
not be received by Landlord or Landlord's designee within ten days after such
amount shall be due, Landlord shall deliver a notice to Tenant of the
delinquency and Tenant shall pay to Landlord a late charge equal to five percent
(5%) of such overdue amount; provided, however, that for the first late payment
under this Lease no late charge shall be payable unless the payment is not made
within 10 days following written notice that such payment is late, and
thereafter that no such late charge shall be payable for the first late payment
in any 12-month period. The parties hereby agree that such late charge
represents a fair and reasonable estimate of the costs Landlord will incur by
reason of late payment by Tenant. Acceptance of such late charge by Landlord
shall, in no event, constitute a waiver of Tenant's default with respect to such
overdue amount, nor prevent Landlord from exercising any of the other rights and
remedies granted hereunder. Any overdue rent and other payments due from Tenant
under this Lease and not paid when due shall bear interest at the rate specified
in Paragraph 18.
12.5 Landlord's Right to Cure Defaults. All agreements, covenants,
conditions and provisions to be performed or observed by Tenant under this Lease
shall be at its sole cost and expense and without any abatement of rent. If
Tenant shall fail to pay any sum of money, other than rent, required to be paid
by it hereunder or shall fail to perform any other act on its part to be
performed hereunder, Landlord may, but shall not be obligated to do so, and
without having or releasing Tenant from any obligations of Tenant, make any such
payment or perform any such other act on Tenant's part to be made or performed
as provided in this Lease. All sums so paid by Landlord and all reasonably
necessary incidental costs shall be deemed Additional Rent hereunder and shall
be payable to Landlord on demand, together with interest thereon at the rate
specified in Paragraph 18 per annum at the time of expenditure by Landlord from
the date of expenditure to the date of repayment by Tenant, and Landlord shall
have (in addition to any other right or remedy of Landlord) the same rights and
remedies in the event of the nonpayment thereof by Tenant as in the case of
default by Tenant in the payment of rent.
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13. Condemnation. If the Premises or any portion thereof or of the Building
are taken under the power of eminent domain, or sold under the threat of the
exercise of said power (all of which are herein called "condemnation"), this
Lease shall terminate as to the part so taken as of the date the condemning
authority takes title or possession, whichever first occurs. If more than
twenty-five percent (25%) of the floor area of the Premises is taken, or if so
much of the Common Areas of the Building is taken as would render the Premises
untenantable, as reasonably determined by Landlord, Tenant may, at Tenant's
option, to be exercised in writing only within ten (10) days after Landlord
shall have given Tenant written notice of such taking (or in the absence of such
notice, within ten (10) days after the condemning authority shall have taken
possession), terminate this Lease as of the date the condemning authority takes
such possession. If Tenant does not terminate this Lease in accordance with the
foregoing, this Lease shall remain in full force and effect as to the portion of
the Premises remaining, except that the rent shall be reduced in the proportion
that the floor area of the Premises taken bears to the total floor area of the
Premises. No reduction of rent shall occur if only Common Areas, areas not
included in the Premises, or areas not within the Building are taken. Any award
for the taking of all or any part of the Premises under the power of eminent
domain or any payment made under threat of the exercise of such power shall be
the property of Landlord, whether such award shall be made as compensation for
diminution in value of the leasehold or for the taking of the fee, or as
severance damages; provided, however, that Tenant shall be entitled to any award
for loss of or damage to Tenant's trade fixtures and removable personal
property. In the event that this Lease is not terminated by reason of such
condemnation, Landlord shall, to the extent of severance damages received by
Landlord in connection with such condemnation, repair any damage to the Premises
caused by such condemnation except to the extent that Tenant has been reimbursed
therefor by the condemning authority.
14. Real Estate Brokers. Tenant represents and warrants that it has not
authorized or employed, or acted by implication to authorize or to employ, any
real estate broker or salesman to act for Tenant in connection with this Lease,
except as otherwise noted in Schedule A. Tenant shall hold Landlord harmless
from and indemnify and defend Landlord against any and all claims by any other
real estate broker or salesman for a commission or finder's fee as a result of
Tenant's entering into this Lease.
15. Estoppel Certificate.
(a) Tenant shall, at any time upon not less than ten (10) days' prior
written request from Landlord, execute, acknowledge and deliver to Landlord a
statement in writing (i) certifying that this Lease is unmodified and in full
force and effect (or, if modified, stating the nature of such modification and
certifying that this Lease, as so modified, is in full force and effect) and the
date to which the rent and other charges are paid in advance, if any, (ii)
acknowledging that there are not, to Tenant's knowledge, any uncured defaults on
the part of Landlord hereunder, or specifying such defaults if any are claimed,
and (iii) certifying or acknowledging facts as to such other matters as Landlord
may reasonably require. Any such statement may be conclusively relied upon by
any prospective purchaser or encumbrancer of the Premises.
(b) At Landlord's option, Tenant's failure to deliver such statement
within such time shall be conclusive upon Tenant, (i) that this Lease is in full
force and effect, without modification, except as may be represented by
Landlord, (ii) that there are no uncured defaults in Landlord's performance,
(iii) that not more than one month's rent has been paid in advance, and (iv)
that such other matters as to which Landlord has requested information are as
represented by Landlord, or such failure may be considered by Landlord as an
uncurable default by Tenant under this Lease five days after written notice has
been delivered to Tenant notifying Tenant of its failure to deliver the estoppel
certificate.
16. Landlord's Liability. The term "Landlord" as used herein shall mean
only the owner or owners at the time in question of the fee title or a tenant's
interest in a ground lease of the Premises, and in the event of any transfer of
such title or interest, Landlord herein named (and in case of any subsequent
transfers then the grantor) shall be relieved from and after the date of such
transfer of all liability as respects Landlord's obligations thereafter to be
performed, provided that any funds in the hands of Landlord or the then grantor
at the time
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of such transfer, in which Tenant has an interest, shall be delivered to the
grantee and provided that Landlord (i.e., the party who is the Landlord after
the transfer) at the time of the transfer maintains $1.2 million of equity in
the project (as determined by the valuation any third-party lender to the
successor Landlord places upon the project). The obligations contained in this
Lease to be performed by Landlord shall, subject as aforesaid, be binding on
Landlord's successors and assigns only during their respective periods of
ownership.
17. Severability. The invalidity of any provision of this Lease as determined by
a court of competent jurisdiction, shall in no way affect the validity of any
other provision hereof.
18. Interest on Past-Due Obligations. Except as otherwise expressly herein
provided, any amount due to Landlord not paid when due shall bear interest at
the rate of 4% over the Wall Street Journal Prime Rate for the date the payment
is due, or, if less, the maximum rate then allowable by law, from the date due.
Payment of such interest shall not excuse or cure any default by Tenant under
this Lease, provided, however, that interest shall not be payable on late
charges incurred by Tenant nor on any amounts upon which late charges are paid
by Tenant.
19. Time of Essence. Time is of the essence.
20. Security Deposit. Upon execution of this Lease, Tenant shall deposit with
Landlord the sum specified on Schedule A, if any, as security for Tenant's
faithful performance of Tenant's, if any, obligations hereunder subject to
reduction as provided below. If Tenant fails to make any payment when due
hereunder, or otherwise defaults with respect to any provisions of this Lease,
Landlord may use, apply or retain all or any portion of said deposit for the
payment of such payment in default or for the payment of any other sum to which
Landlord may become obligated by reason of Tenant's default, or to compensate
Landlord for any loss or damage which Landlord may suffer thereby. If Landlord
so uses or applies all or any portion of said deposit, Tenant shall within ten
(10) days after written demand therefor deposit cash with Landlord in an amount
sufficient to restore said deposit to the full amount hereinabove stated, and
Tenant's failure to do so shall be a breach of this Lease. If Tenant performs
all of Tenant's obligations hereunder (except in case of a good faith dispute
over Operating Expenses), Landlord shall (upon Tenant's request therefor) refund
$10,000 of such security deposit on each of the first four anniversary dates of
the Term, and Tenant shall not after the fourth anniversary be required to
maintain any security deposit. If 0enant performs all of Tenant's obligations
hereunder, said deposit, or so much thereof as has not theretofore been applied
by Landlord, shall be returned to Tenant (or at Landlord's option, to the last
assignee, if any, of Tenant's interest hereunder) at the expiration of the term
hereof, and after Tenant has vacated the Premises. Landlord shall not be
required to keep this security deposit separate from its general funds, and
Tenant shall not be entitled to interest on such deposit. Upon termination of
the original Landlord's or any successor Landlord's interest in the Premises,
the original Landlord or such successor Landlord shall be relieved of further
liability with respect to the security deposit, provided that the amount thereof
in the hands of the original Landlord or such successor Landlord has been
delivered to the new owner of the Premises. No trust relationship is created
hereby between Landlord and Tenant with respect to said security deposit.
21. Incorporation of Prior Agreements; Amendments. This Lease contains all
agreements, oral or written, of the parties with respect to any matter mentioned
herein. No prior agreement or understanding pertaining to any such matter shall
be effective. There are no representations between Landlord and Tenant or
between any real estate broker and Tenant other than those contained in this
Lease. This Lease may be modified in writing only, signed by the parties in
interest at the time of the modification.
22. Notices. Any notice required or permitted to be given hereunder shall be in
writing and may be given by personal delivery, nationally recognized overnight
delivery service, or by registered or certified mail, return receipt requested.
If given personally, such notice shall be deemed sufficiently given if delivered
to any person apparently in charge or authorized to receive mail, or if given by
mail, shall be deemed sufficiently given if addressed to Tenant or to Landlord,
at the address noted in Schedule A or, if sent to Tenant subsequent to Tenant's
taking possession of the Premises, at the Premises. Any notice shall be deemed
to
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have been given upon the date of personal delivery or, if mailed, three (3) days
after the date of mailing as provided herein. Either party may by notice to the
other specify a different address for notice purposes. A copy of all notices
required or permitted to be given to Landlord hereunder shall be concurrently
transmitted to such party or parties at such addresses as Landlord and Tenant
may from time to time hereafter designate, by notice, to the other party.
23. Waivers. No waiver by Landlord or Tenant of any provision hereof shall
be deemed a waiver of any other provision hereof or of any subsequent breach by
Landlord or Tenant of the same or any other provision. Landlord's consent to, or
approval of any act, shall not be deemed to render unnecessary the obtaining of
Landlord's consent to or approval of any subsequent act by Tenant. The
acceptance of rent hereunder by Landlord shall not be a waiver of any preceding
breach by Tenant of any provision hereof, other than the failure of Tenant to
pay the particular rent, so accepted, regardless of Landlord's knowledge of such
preceding breach at the time of acceptance of such rent.
24. Parking. Tenant shall be entitled to park in common with other tenants
of Landlord and shall have the nonexclusive right to use of the number of
parking places set forth on Schedule A, or any lesser number which is now or
hereafter required under applicable laws or regulations affecting parking space
requirements. Tenant agrees not to overburden the parking facilities and agrees
to cooperate with Landlord and other tenants in the use of parking facilities.
Landlord reserves the right in its absolute discretion to determine whether
parking facilities are becoming crowded and, in such event, to allocate or
reallocate parking spaces among Tenant and other tenants.
25. Holding Over. If Tenant, with Landlord's consent, remains in possession
of the Premises or any part thereof after the expiration of the term hereof,
such occupancy shall be a tenancy from month to month at a rental in the amount
of 150% the last Base Monthly Rent installment, plus all other Additional Rent
and charges payable hereunder during the option term, and upon all the other
provisions of this Lease pertaining to the obligations of Tenant, but all
options and rights of first refusal, if any, granted under the terms of this
Lease shall be deemed terminated and be of no further effect during said month
to month tenancy. Each party shall give the other written notice at least one
month prior to the date of termination of such monthly tenancy of its intention
to terminate.
26. Cumulative Remedies. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other remedies at
law or in equity.
27. Binding Effect; Choice of Law. Subject to any provisions hereof
restricting assignment or subletting by Tenant and subject to the provisions of
Paragraph 16, this Lease shall bind the parties, their personal representatives,
successors and assigns. This Lease shall be governed by the laws of the State of
California.
28. Subordination.
(a) This Lease, at Landlord's option, shall be subordinate to any
ground lease, mortgage, deed of trust, or any other hypothecation for security
now or hereafter placed upon the real property of which the Premises are a part,
or to any and all advances made on the security thereof and to all renewals,
modifications, consolidations, replacements and extensions thereof.
Notwithstanding such subordination, Tenant's right to quiet possession of the
Premises shall not be disturbed so long as Tenant shall pay the rent and observe
and perform all the provisions of this Lease unless this Lease is otherwise
terminated pursuant to its terms. If any mortgagee, trustee or ground lessor
shall elect to have this Lease prior to the lien of its mortgage, deed of trust
or ground lease, and shall give written notice thereof to Tenant, this Lease
shall be deemed prior to such mortgage, deed of trust, or ground lease, whether
this Lease is dated prior or subsequent to the date of said mortgage, deed of
trust or ground lease or the date of recording thereof.
(b) Tenant agrees to execute any documents containing nondisturbance
provisions as described in Paragraph 28(a) reasonably required to acknowledge or
effectuate an attornment, a subordination or to make this Lease prior to the
lien of any mortgage, deed of
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trust or ground lease, as the case may be, and failing to do so within ten (10)
days after written demand does hereby make, constitute and irrevocably appoint
Landlord as Tenant's attorney in fact and in Tenant's name, place and stead, to
do so.
29. Attornment. In the event of foreclosure or the exercise of the power of sale
under any deed of trust made by Landlord covering the Premises (or a transfer
under a deed in lieu of foreclosure), Tenant shall attorn to the purchaser upon
any such foreclosure or sale (or to the grantee of such deed in lieu of
foreclosure), and Tenant shall recognize such purchaser or grantee as Landlord
under this Lease, provided such purchaser or grantee agrees in writing to
recognize all of Tenant's rights hereunder and to perform all of Landlord's
obligations hereunder from the date of the attornment.
30. Landlord's Access. Landlord and Landlord's agents shall have the right to
enter the Premises at reasonable times (including, in an emergency, immediate
entry without notice) for the purpose of inspecting the same, showing the same
to prospective purchasers, lenders, or tenants, making such alterations,
repairs, improvements or additions to the Premises or to the Building as
Landlord may deem necessary or desirable, and the erecting, use and maintenance
of utilities, services, pipes and conduits through the Premises, as long as
there is no material adverse effect upon Tenant's use of the Premises. Landlord
may at any time place on or about the Premises any ordinary "For Sale" signs,
and Landlord may, at any time during the last ninety (90) days of the term
hereof, place on or about the Premises any ordinary "For Lease" signs, all
without rebate of rent or liability to Landlord. Landlord shall retain a key to
all locked portions of the Premises (except vaults and locked file or storage
cabinets) at all times and shall have the right to unlock all doors. Tenant may
not change locks upon the Premises unless Tenant furnishes Landlord with a key
thereto. Tenant waives any claim or charges for damages or interference with
Tenant's property or business, any loss of quiet enjoyment or other loss
occasioned by Landlord's entry. Except in an emergency, Landlord shall effect
such entry in compliance with Tenant's reasonable security procedure.
31. Signs. Tenant may install on the Premises signs which identify Tenant and
the business Tenant conducts on the Premises, provided Tenant's signs comply
with (a) applicable requirements of governmental authorities, (b) applicable
recorded restrictions, and (c) Landlord's reasonable requirements, which may
include limitations on the number and placement of signs. Subject to compliance
with the foregoing requirements, Tenant may place a monument sign at the Camino
Ramon entrance to the Premises. In addition, subject to compliance with the
foregoing requirements, so long as Tenant leases the entire ground floor of the
Building, Landlord shall not allow any other tenant (or other person or entity)
to place a sign on the parapet of the Building. Tenant shall not install its
signs without Landlord's prior written approval which shall not be unreasonably
withheld or delayed. Tenant shall maintain its signs in neat condition and
repair throughout the Lease term. Tenant shall repair any damage which
maintenance, alterations or renovation of its signs may cause during or at the
expiration of the Lease term. Landlord agrees not to permit another tenant to
install parapet signs on the exterior top of the Building unless and until
Tenant ceases to lease the entire ground floor of the Building.
32. Merger. The voluntary or other surrender of this Lease by Tenant, or a
mutual cancellation thereof, or a termination by Landlord, shall not work a
merger, and shall, at the option of Landlord, terminate all or any existing
subtenancies or may, at the option of Landlord, operate as an assignment to
Landlord of any or all of such subtenancies.
33. No Light, Air or View Easement. Any diminution or shutting off of light, air
or view by any structure which may be erected on lands adjacent to the Premises
shall in no way affect this Lease or impose any liability on Landlord.
34. Consents. In any case in which either Landlord or Tenant is required to give
consent or approve any action of the other party under this Lease, such consent
shall not be unreasonably withheld or delayed.
35. Quiet Possession. Upon Tenant paying the rent for the Premises and observing
and performing all of the covenants, conditions and provisions on Tenant's part
to be observed
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and performed hereunder, Tenant shall have quiet possession of the Premises for
the entire term hereof subject to all of the provisions of this Lease. The
individuals executing this Lease on behalf of Landlord represent and warrant to
Tenant that they are fully authorized and legally capable of executing this
Lease on behalf of Landlord, and that such execution is binding upon all parties
holding an ownership interest in the Premises.
36. Landlord's Rules and Regulations. Tenant agrees that it will abide by,
keep and observe all reasonable rules and regulations which Landlord may make
from time to time for the management, safety, care and cleanliness of the
Building and grounds, the parking of vehicles and the preservation of good order
therein as well as for the convenience of other occupants and tenants of the
Building. Landlord's current Rules and Regulations, if any, are attached as
Exhibit D to this Lease, and Tenant shall faithfully comply with all such rules
and regulations and all reasonable modifications thereof and additions thereto
from time to time promulgated in writing by Landlord. The violation of any such
rules and regulations by Tenant shall be deemed a material breach of this Lease.
Landlord shall not be responsible to Tenant for the nonperformance of any such
rules and regulations by any other tenant of the Building or another Building
within the same complex.
37. Security Measures. Tenant hereby acknowledges that the rental payable
to Landlord hereunder does not include the cost of guard service or other
security measures, and that Landlord shall have no obligation whatsoever to
provide the same. Tenant assumes all responsibility for the protection of
Tenant, its agents and invitees from acts of third parties. Nothing contained
herein shall prevent Landlord, at Landlord's sole option, from providing
security protection for the Building or any part thereof, in which event, the
cost thereof shall be included within the definition of Operating Expenses as
set forth in Paragraph 4.3.
38. Landlord's Reservation of Rights.
38.1 Easements. Landlord reserves to itself the right, from time to
time, to grant such easements, rights and dedications that Landlord deems
necessary or desirable and to cause the recordation of Parcel Maps and
restrictions, so long as such easements, rights, dedications, maps and
restrictions do not unreasonably interfere with the use of the Premises by
Tenant. Tenant shall sign any of the aforementioned documents upon request of
Landlord and failure to do so shall constitute a material breach of this Lease.
38.2 Building Rights. Landlord shall have the right to (i) change the
name, address or title of the Building upon at least sixty (60) days' prior
written notice to Tenant, providing Landlord pays Tenant's reasonable costs of
printing new stationery reflecting such change; (ii) to, at Tenant's expense,
provide and install Building standard graphics on the door of the Premises and
such portions of the Common Areas as Landlord deems appropriate; (iii) to permit
any tenant the exclusive right to conduct any business as long as such exclusive
right does not conflict with any rights expressly granted herein; and (iv) to
place such signs, notices or displays as Landlord deems appropriate upon or
about the exterior of the Building or the Common Areas.
39. Authority. If Tenant is a corporation, trust, or general or limited
partnership, each individual executing this Lease on behalf of such entity
represents and warrants that he or she is duly authorized to execute and deliver
this Lease on behalf of such entity.
40. Conflict. Any conflict between the printed provisions of this Lease and
the typewritten or handwritten provisions shall be controlled by the typewritten
or handwritten provisions.
41. Attorneys' Fees. In the event of any action or proceeding at law or in
equity between Landlord and Tenant to enforce any provision of this Lease or to
protect or establish any right or remedy of either Landlord or Tenant hereunder,
the unsuccessful party to such action or proceeding shall pay to the prevailing
party all costs and expenses, including reasonable attorneys' fees, incurred in
such action or proceeding and in any appeal in connection therewith, and if such
prevailing party shall recover judgment
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in any such action, proceeding or appeal, such costs, expenses and attorneys'
fees shall be included in and as part of such judgment.
42. Exhibits. The following exhibits are attached to this Lease and herein
incorporated by reference: Exhibit A (Site Plan); Exhibit B (Premises); Exhibit
C (Initial Improvements of Premises); Exhibit D (Rules and Regulations); Exhibit
E (Rules and Regulations for Tenant Contractors); and Exhibit F (CC&R's).
43. Options.
43.1 Options Personal. Any options ("Options") granted to Tenant in
this Lease (including, without limitation, the renewal option granted in
Paragraph 44, expansion rights granted in Paragraph 46, the cancellation right
granted in Paragraph 48, and the right of first offer granted in Paragraph 47)
are personal to Tenant and may not be exercised or be assigned, voluntarily or
involuntarily, by or to any person or entity other than Tenant; provided,
however, that any Option may be exercised by or assigned to any Tenant Affiliate
as defined in Paragraph 11.2 of this Lease and provided further than any Option
other than the expansion rights granted in Paragraph 46 may be assigned in
conjunction with an approved assignment of this Lease.
43.2 Effect of Default on Option.
(a) Tenant shall have no right to exercise an Option,
notwithstanding any provision in the grant of Option to the contrary, (i) during
the time commencing from the date Landlord gives to Tenant a notice of default
pursuant to Paragraph 12.1(c) and continuing until the default alleged in said
notice of default is cured, or (ii) during the period of time commencing on the
day after a monetary obligation to Landlord is due from Tenant and unpaid
(without any necessity for notice thereof to Tenant) continuing until the
obligation is paid, (except if there exists a bona fide dispute as to whether
such amounts are payable) or (iii) at any time after an event of default
described in Paragraph 12.1(a), 12.1(d), 12.1(e) or 12.1(f) (without any
necessity of Landlord to give notice of such default to Tenant), or (iv) in the
event there have been three or more defaults under Paragraph 12.1(b) during the
prior 12 months (except if there exists a bona fide dispute as to whether such
amounts are payable) where a late charge becomes payable under Paragraph 12.4
for each of such defaults, and/or notices of default under Paragraph 12.1(c),
whether or not the defaults are cured.
(b) The period of time within which an Option may be exercised
shall not be extended or enlarged by reason of Tenant's inability to exercise an
Option because of the provisions of Subparagraph (a) above.
(c) All rights of Tenant under the provisions of an Option shall
terminate and be of no further force or effect, notwithstanding Tenant's due and
timely exercise of the Option, if any of the circumstances specified in (a)
above occurs after such exercise but prior to the time the Option takes effect.
44. Extension Option. Landlord hereby grants to Tenant the option to extend
the term of this Lease (the "Extension Option") for one additional five-year
period. Tenant shall exercise such Extension Option by giving written notice of
exercise to Landlord at least six (6) months prior to the Expiration Date. All
of the terms and conditions of this Lease shall govern such extended term
insofar as applicable, and all references in this Lease to the term hereof shall
be deemed to include such extended term unless the context clearly indicates to
the contrary.
45. Extended Term - Rent (Fair Market Value Determination).
(a) The Base Monthly Rent for the Extension Option term shall be 95% of
the fair market rate for comparable space in the San Ramon and Pleasanton areas
as of the commencement of the Extension Option term as determined by the
agreement of the parties or, if the parties are unable to agree on or before
ninety (90) days prior to the expiration of the term, then by an appraisal
conducted pursuant to Subparagraph (b) below. The Base Monthly Rent shall take
into account the duration of the extension term and may provide for reasonable
periodic rental increases during such term.
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(b) If it becomes necessary to determine the fair market rate for the
Premises by appraisal, then real estate appraiser(s), all of whom shall be
members of the American Institute of Real Estate Appraisers and shall have at
least two years' experience appraising commercial and industrial real property
located within the vicinity of the Premises, shall be appointed and shall act in
accordance with the following procedures:
(i) If Landlord and Tenant are unable to agree on the Monthly
Base Rent for the Extension Option term, then either party may demand an
appraisal by giving written notice to the other party which demand to be
effective must state the name, address and qualifications of an appraiser
selected by the party demanding an appraisal (the "Notifying Party"). Within ten
(10) days following the Notifying Party's appraisal demand, the other party (the
"Non-Notifying Party") shall either approve the appraiser selected by the
Notifying Party or select a second properly qualified appraiser by giving
written notice of the name, address and qualifications of said appraiser to the
Notifying Party. If the Non-Notifying Party fails to select an appraiser within
the ten (10) day period, then the appraiser selected by the Notifying Party
shall be deemed selected by both parties and no other appraiser shall be
selected. If two appraisers are selected, they shall select a third
appropriately qualified appraiser. If the two appraisers fail to select a third
qualified appraiser within ten (10) days, then, upon application by either
party, the third appraiser shall be appointed by the President (or person
serving in comparable position, if there is no President) of the local Real
Estate Board (or any successor entity or body of comparable standing if such
Board does not then exist) or the person to whom the President may delegate that
function.
(ii) If only one appraiser is selected, then that appraiser shall
notify the parties in simple letter form of its determination of the fair market
rate for the Premises within thirty (30) days of his selection, which appraisal
shall be conclusively determinative and binding on the parties as the fair
market rent for the Premises.
(iii) If multiple appraisers are selected, then the appraisers
shall meet not later than ten (10) days following selection of the last
appraiser. At such meeting, the appraisers shall attempt to determine the fair
market rate for the Premises as of the commencement date of the Option period by
the agreement of at least two of the appraisers.
(iv) The appraisers' determination of the fair market rate shall
be based on a building of the same age, construction, size and location as the
Premises and shall take into account Tenant's obligation to pay additional rent
under the terms of this Lease. In determining the fair market rate, the
appraisers shall not consider any improvements, alterations, additions, fixtures
or equipment installed in the Premises at Tenant's expense, but shall include
improvements, alterations, additions, fixtures of equipment installed at
Landlord's expense. If two or more of the appraisers agree on the fair market
rate for the Premises at the initial meeting, then such agreement shall be
determinative and binding on the parties hereto, and the agreeing appraisers
shall, in simple letter form executed by the agreeing appraisers, forthwith
notify both Landlord and Tenant of the amount set by such agreement.
(v) If multiple appraisers are selected and the agreement of at
least two appraisers cannot be obtained within ten (10) days after the initial
meeting, then, within five (5) days after the expiration of said ten (10) day
period, all appraisers shall submit to Landlord and Tenant and independent
appraisal, in simple letter form, of the fair market rent for the Premises. The
parties shall then determine the appraised fair market rent for the Premises by
averaging the appraisals; provided, however, that (i) if the lowest appraisal is
less than eighty-five percent (85%) of the middle appraisal, then such lowest
appraisal shall be disregarded, and (ii) if the highest appraisal is greater
than one hundred fifteen percent (115%) of the middle appraisal, then such
highest appraisal shall be disregarded. If any appraisal is so disregarded, then
the average shall be determined by computing the average of the appraisals that
have not been disregarded.
(vi) Nothing contained herein shall prevent Landlord and Tenant
from jointly selecting a single appraiser to determine the fair market rate of
the Premises, in which
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event, the determination of such appraisal shall be conclusively deemed to be
the fair market rate of the Premises for the Extension Option term in question.
(vii) If only one appraiser is selected, then each party shall pay
half of the fees and expenses of that appraiser. If three appraisers are
selected, then each party shall bear the fees and expenses of the appraiser it
selects, plus half of the fees and expenses of the third appraiser.
46. Expansion Option. Landlord hereby grants to Tenant the option (the
"Expansion Option") to lease from Landlord, in addition to the Premises, any
other portion of the Building in which the Premises are situated or, after its
initial lease-up, any portion of the building located at 4550 Norris Canyon Road
(hereinafter called the "Expansion Space"), at any time on or prior to April 15,
1998 that such space becomes available for Lease. Tenant's rights pursuant to
this Expansion Option shall be subordinate to any rights held by SBE or Biogenex
with respect to certain space consisting of approximately 9600 square feet
located at 4550 Norris Canyon Road, more specifically described and set forth in
Exhibit G, attached hereto ("Subordinated Space"). This expansion right shall
terminate immediately as to the building located at 4550 Norris Canyon Road upon
a sale or other transfer of such building to an unaffiliated third party. When
any such space becomes available, Landlord shall notify Tenant in writing of its
availability. Tenant shall exercise its Expansion Option by written notice
delivered to Landlord within ten days of receipt of Landlord's notice of
availability. If Tenant exercises its option to lease such Expansion Space, the
parties shall perform whatever acts are necessary to execute a lease thereof (or
an addendum hereto adding such Expansion Space to the Premises) within 30 days
after Tenant notifies Landlord of the exercise of Tenant's Expansion Option. Any
such lease by Tenant of any Expansion Space shall expire co- terminously with
the original Lease and shall be at the same rental per square foot of floor
space and upon all of the other terms and conditions of this Lease then in
effect; provided, however, that the tenant improvement allowance specified in
Exhibit C shall be reduced proportionately to the reduced initial term of this
Lease as it applies to the Expansion Space. If Tenant fails within the aforesaid
ten-day period to exercise its option to lease such Expansion Space hereunder,
it shall be conclusively presumed at the end of such ten-day period that Tenant
has waived its right to exercise such Expansion Option, but Tenant shall
thereafter retain its Right of First Offer under Paragraph 47 with respect to
such space. Such Expansion Option shall not be applicable to any space in the
Building which is subject to expansion or renewal options, or prior rights of
first offer or first refusal existing on the execution date hereof. Landlord
shall not be liable to Tenant for any failure of an existing occupant to vacate
Expansion Space leased by Tenant in a timely manner.
47. Right of First Offer.
(a) [intentionally deleted]
(b) Grant of Right of First Offer. Landlord hereby agrees to notify
Tenant in writing, specifying the terms set forth in Subparagraph (c) below,
each time at least two thousand (2,000) contiguous square feet of space in the
Building becomes available for lease from Landlord (hereinafter the "Right of
First Offer"); provided, however, that such Right of First Offer shall not be
applicable to any space in the Building which is subject to expansion or renewal
options, or prior rights of first offer or first refusal existing on the
execution date hereof.
Such Right of First Offer shall be nonexclusive. Landlord shall be
permitted to offer the space available to present or future tenants in the
Building whose leases contain similar rights of first offer at the same time as
such space is being offered to Tenant. In the event one or more other tenants
exercise rights of first offer and there is insufficient space available to
satisfy the requirements of all tenants, the space available shall be offered to
each tenant in proportion to the space requested in each tenant's Requirements
Notice. Furthermore, Tenant's rights pursuant to this Right of First Offer shall
be subordinate to any rights held by SBE and Biogenex with respect to the
Subordinated Space.
(c) Offering Notice. Each notice made by landlord pursuant to
Subparagraph (b) above (the "Offering Notice") shall specify (i) the number of
square feet of space available
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and the location of such space, (ii) the market rent and other charges at which
Landlord intends to offer such space, (iii) the value of leasehold improvements
or tenant allowance to be provided by Landlord for such space, if any, and (iv)
the estimated date that such space will be available for occupancy by Tenant.
Landlord hereby agrees that space offered to Tenant pursuant to this Right of
First Offer shall be offered at the rent and on the terms which Landlord in good
faith intends to offer to the general public. Tenant shall have fifteen (15)
days after receipt of the Offering Notice to accept or reject such space on the
terms specified in the Offering Notice. If Tenant rejects space offered pursuant
to an Offering Notice, Landlord's obligation to offer the particular such space
in question to Tenant in the future pursuant to this Right of First Offer shall
terminate.
(d) Acceptance of Space. If Tenant desires to lease the space offered,
then Tenant shall have thirty (30) days to enter into a lease of such space on
the terms and conditions set forth in the Offering Notice and on such other
terms and conditions as Landlord offers to the general public (including any
increased rental or premium as a result of space rendered less marketable due to
Tenant's leasing of additional space) (hereinafter an "Expansion Lease");
provided, however, that (a) the term of any such Expansion Lease shall be
coterminous with the Lease (including any options to extend the term of the
Lease), and (b) if three (3) or less years remain in the term or any extended
term of the Lease (and Tenant has not exercised any remaining options to extend
the terms of the Lease) then (i) the rent provided in such Expansion Lease shall
be adjusted to reflect the cost of any tenant improvements or alterations borne
by Landlord amortized over the remaining term of the Lease at an interest rate
of 10%, or (ii) Tenant shall agree to pay to Landlord, at the end of the term of
such Expansion Lease, an amount equal to the portion of the cost of such tenant
improvements not recovered by Landlord pursuant to such Expansion Lease
(amortized at an interest rate of 10%).
(e) Restrictions. Any space occupied pursuant to an Expansion Lease
shall be used and occupied only for the same uses permitted under this Lease,
except as otherwise agreed by Landlord. This Right of First Offer shall,
automatically and without notice, terminate upon (i) the termination of the
Lease for any reason; (ii) the subletting by Tenant at any one time of more than
25% of the Net Rentable Area of the Premises; (iii) the sale to an unaffiliated
third party of all or any portion of the Building by Landlord with regard to the
portion so sold. Furthermore, Tenant may not exercise any Right of First Offer,
and Landlord shall have no obligation to make such first offer to Tenant at any
time that Tenant is in default (as defined in Paragraph 12.1) of any of its
obligations under this Lease.
48. Cancellation Right.
(a) If, effective at any time from and after the end of the seventh
Lease year, Landlord fails to give Tenant notice of the availability of
additional space anywhere within the project commonly known as Norris Technology
Center sufficient to meet any expansion needs within 30 days of receipt of
Tenant's good faith written notification of its expansion requirements, Tenant
may elect to terminate this Lease upon at least 30 days' prior written notice.
Tenant shall exercise such election following the seventh anniversary of the
Commencement Date and within 30 days following Landlord's acknowledgement to
Tenant that it is unable to meet Tenant's expansion needs, by written notice to
Landlord specifying the intended Lease termination date and by making the
payment required by Subsection (b) below.
(b) If Tenant exercises its right to terminate this Lease as provided
above, Tenant shall pay CalFront Associates (and not any successor landlord that
hereafter becomes Landlord under this Lease) on or prior to the termination
date: (i) unamortized leasing commissions; plus (ii) the unamortized portion of
Landlord's cost of Tenant's Initial Improvements constructed pursuant to Exhibit
C. Amortization shall be computed on a straight-line basis over the initial
ten-year term on the basis of the applicable principal amounts without interest.
49. Moving Allowance. As an additional inducement to Tenant to enter into
this Lease, Landlord shall pay Tenant $1 per square foot of Net Rentable Area of
the Premises as a moving allowance to cover certain direct out-of-pocket costs
related to Tenant's relocation to
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the Premises from its existing premises. Such allowance shall be payable upon
the initial Premises leased hereunder and any Expansion Space leased by the
Tenant pursuant to Paragraph 46 hereof. Such costs shall include the cost of
moving services and of replacing Tenant's existing supplies of stationery.
Landlord shall pay Tenant such amount within 30 days following submission of
invoices therefor in form reasonably satisfactory to Landlord.
(Signature Page Follows)
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IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the date
first above written.
LANDLORD:
CALFRONT ASSOCIATES
By:______________________________________
Title:___________________________________
Date:____________________________________
By:______________________________________
Title:___________________________________
Date:____________________________________
TENANT:__________________________________
GIGA-TRONICS INCORPORATED
By:______________________________________
Title:___________________________________
Date:____________________________________
By:______________________________________
Title:___________________________________
Date:____________________________________
35.
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EXHIBIT A
Exhibit A consists of a Site Plan drawing of Building and Parking Lots.
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EXHIBIT A
PARCEL 1:
LOTS 1 THROUGH 4, AS SAID LOTS ARE SHOWN ON THE MAP OF TRACT
5692, FILED , IN BOOK OF MAPS, PAGE CONTRA COSTA
COUNTY RECORDS.
PARCEL 2:
PORTION OF LOT 5, AS SAID LOT IS SHOWN ON THE MAP OF TRACT 5692,
FILED , IN BOOK OF MAPS, PAGE CONTRA COSTA COUNTY
RECORDS, DESCRIBED AS FOLLOWS:
BEGINNING AT A POINT IN THE WESTERLY LINE OF LOT 5, AS SAID LOT IS SHOWN ON THE
AFOREMENTIONED TRACT 5692, DISTANT THEREON SOUTH 20(degree) 52' 07" EAST 800
FEET FROM THE MOST WESTERLY CORNER THEREOF; THENCE NORTH 20(degree) 52' 07"
WEST, 800 FEET; NORTH 62(degree) 48' 40" EAST, 188.42 FEET; NORTH 58(degree) 11'
11" EAST, 89.25 FEET, NORTH 63(degree) 40' 05" EAST, 2508.37 FEET; THENCE ALONG
THE ARC OF A CURVE TO THE LEFT WITH A RADIUS OF 642 FEET, AN ARC DISTANCE OF
44.97 FEET; THENCE SOUTH 28(degree) 49' 41" EAST, 800 FEET; THENCE SOUTHWESTERLY
IN A DIRECT LINE TO THE POINT OF BEGINNING.
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[Notary Attestation]
39
EXHIBIT C
Tenant Improvements
Work Letter Agreement
1. Landlord's Work.
1.1 Landlord, through its general contractor, South Bay Construction
Company, shall furnish and install within the Premises those items of general
construction finally approved by Landlord and Tenant to build out the Premises
in accordance with the space plan attached as Exhibit ____ ("Landlord's Work")
as shown on the plans and specifications to be developed by Landlord's architect
or engineer (the "Final Plans and Specifications"), using Landlord's Building
standard materials, finishes and installations.
1.2 Landlord's subcontractors for mechanical, electrical and fire
systems shall be selected by mutual agreement of Landlord and Tenant. The
construction contract shall require major subcontracts other than those for
mechanical, electrical and fire systems to be selected after three bids have
been obtained.
2. Cost of Landlord's Work.
2.1 As its contribution to the cost of Landlord's Work, Landlord shall
provide to Tenant a tenant improvement allowance equal to the cost of Landlord's
Work as shown on the Final Plans and Specifications as approved in Paragraph 1.1
above, up to $20 per square foot of Net Rentable Area. Tenant shall pay the cost
of all Landlord's Work in excess of such tenant improvement allowance as
provided in this Article 2. The cost of demolishing existing improvements and of
installing grade level loading doors shall be paid through the application of
such tenant improvement allowance except for the costs of demolishing existing
improvements in the portion of the space delineated on Attachment I as "former
DoD Space", which Landlord shall demolish at its sole cost. In addition,
Landlord shall bear the cost of any code compliance work required as a condition
to obtaining a building permit and not required by Tenant's special uses of the
Premises and the cost of providing a separate heating, ventilation and air
conditioning system to the Premises, which shall not be offset against the
tenant improvement allowance. If the Initial Improvement costs are less than the
full amount of Landlord's allowance, any unexpended balance up to $5 per square
foot of Net Rentable Area shall be credited towards Tenant's first payments of
Base Monthly Rent due under the Lease.
2.2 Tenant shall bear the cost of Landlord's Work to the extent such
costs result from changes requested by Tenant to Final Plans and Specifications
or for requests for materials which cause the cost of Landlord's Work to exceed
the tenant improvement allowance.
2.3 Landlord's obligation to perform Landlord's Work shall not require
Landlord to incur overtime costs and expenses and shall be subject to
unavoidable delays due to acts of God, governmental restrictions, strikes, labor
disturbances, shortages of material or supplies and any other cause or event
beyond Landlord's reasonable control.
2.4 Tenant shall promptly pay Landlord during the course of
construction the cost of the work to be paid by Tenant under this Article 2,
based on invoices submitted by Landlord's contractor and certified by Landlord's
architect, so as to enable Landlord to pay Landlord's contractor without
advancing Landlord's funds for the cost of the work to be paid by Tenant.
2.5 It is understood and agreed by Tenant that any minor changes from
any plans and specifications that may be reasonably necessary during
construction of the Premises shall not affect, change or invalidate this Lease.
1.
40
3. Plans and Specifications.
3.1 Landlord, through its architect and engineer, shall furnish all
architectural and engineering plans and specifications ("Plans and
Specifications") required to complete Final Plans and Specifications for the
construction of Landlord's Work.
3.2 Tenant shall be furnished a copy of Final Plans and Specifications
and shall request any Tenant changes within seven days of submission to Tenant
by Landlord.
3.3 Landlord shall bear the cost of architectural services for
Landlord's Work except as provided in Paragraph 3.4 below.
3.4 Tenant shall pay the cost of any engineering services for
Landlord's Work. In addition, Tenant shall pay for any revisions required by
Tenant to Plans and Specifications previously approved by Tenant. The tenant
improvement allowance may be applied towards such architectural and engineering
costs.
4. Tenant's Work.
4.1 Any items or work not shown in the approved Final Plans and
Specifications, such as telephone service, furnishings or floor coverings for
which Tenant contracts separately (hereinafter "Tenant's Work") shall be subject
to Landlord's policies and schedules and shall be conducted in such as way as
not to hinder, cause any disharmony with, or delay work in the Building(s).
Tenant's suppliers, contractors, workmen and mechanics shall be subject to
approval by Landlord prior to the commencement of their work (which approval
shall not be unreasonably withheld or delayed) and shall be subject to
Landlord's administrative control while performing their work. If at any time
any supplier, contractor, workman or mechanic performing Tenant's Work hinders
or delays any other work in the Building(s) or performs any work which may or
does impair the quality, integrity or performance of any portion of the
Building(s), Tenant shall cause such supplier, contractor, workman or mechanic
to leave the Building(s) and remove all his tools, equipment and materials
immediately upon Landlord's notice delivered to Tenant. Tenant shall reimburse
Landlord for any repairs or corrections of Landlord's Work or of Tenant's Work
or of any portion of the Building(s) caused by or resulting from the work of any
supplier, contractor, workman or mechanic with whom Tenant contracts. Tenant
shall bear the cost of Landlord's expenses resulting from the performance of
Tenant's Work, including without limitation the cost of hoisting, cleaning,
security, administration and coordination by Landlord or Landlord's contractor.
Tenant shall reimburse Landlord for Landlord's reasonable direct out-of-pocket
costs for design reviews and approvals and reviews of construction progress, and
for the cost of all utilities and the services provided by Landlord to or for
the Premises during the performance of Tenant's Work. Landlord shall provide
access to Tenant's suppliers, contractors, workmen and mechanics so as to
achieve timely completion and occupancy of the Premises, if Landlord's
construction schedule permits such early entry and Tenant's early entry does not
interfere with Landlord's construction.
5. [RESERVED]
6. Completion Date.
6.1 Landlord shall, when construction progress so permits, notify
Tenant, in advance, when it may enter the Premises for purposes of constructing
Tenant's Work as specified in Paragraph 4.1 of this Exhibit C, which shall be at
least 15 days prior to substantial completion of Landlord's Work in order to
allow Tenant to install Tenant's cabling, furniture and equipment. Landlord
shall also, when construction progress so permits, notify Tenant in advance of
the approximate date on which Landlord's Work will be substantially completed
and will notify Tenant when Landlord's Work is, in fact, substantially
completed, which latter notice shall constitute delivery of possession of the
Premises to Tenant. If any dispute shall arise as to whether the Premises are
substantially completed and ready for Tenant's occupancy, a certificate
furnished by Landlord's architect certifying the date of substantial completion
shall be conclusive of that fact and date and
2.
41
binding upon Landlord and Tenant. If the Commencement Date is delayed because
Landlord is delayed in substantially completing said work as a result of:
(a) Tenant's failure to furnish complete and timely instructions or
approvals,
(b) Tenant's changes to any Plans and Specifications after approval
thereof,
(c) Tenant's request for materials, finishes or installations other
than Landlord's Building standard, except as expressly provided in approved
Plans and Specifications, or
(d) Hindrance or disruption of the work of Landlord's contractor
resulting from Tenant's Work, then the Commencement Date under the Lease shall
be advanced by the number of days of such delay.
6.2 Failure by Tenant to meet any of the time requirements specified in
this Exhibit C shall, at Landlord's option, constitute a a default under the
Lease. Tenant shall not be entitled to a cure period with respect to any such
default.
6.3 Except as expressly provided in the Lease, failure of Landlord to
deliver possession of the Premises within the time and in the condition provided
for in the Lease will not give rise to any claim for damages by Tenant against
Landlord or Landlord's contractor.
6.4 Upon Landlord's delivery to Tenant of the notice of substantial
completion specified in Paragraph 6.1, Landlord and Tenant shall together hold a
walkthrough of the Premises. Landlord and Tenant shall identify those items
contained in the Final Plans and Specifications which are not completed in
accordance with such Final Plans and Specifications or not done in a good and
workmanlike manner and a "punchlist" (as such term is used is the construction
industry) of such items shall be jointly developed within 30 days of delivery of
possession. Landlord shall commence correction of the items on such punchlist
within 30 days thereafter and shall diligently pursue such corrective work to
completion to the reasonable satisfaction of both Tenant and Landlord.
7. Payment.
7.1 Tenant shall pay to Landlord all amounts due from or payable by
Tenant under the terms of this Exhibit C within 30 days following delivery of
Landlord's invoice therefor, and the provisions of the Lease with respect to
late charges and interest on late payments shall apply as to interest payable on
amounts not paid within such period.
8. Time Periods.
8.1 All time periods referred to in this Exhibit C shall be computed on
a calendar basis with no allowance for holidays, weekends or other customs.
9. Base Building Design.
9.1 Tenant may request changes to Base Building Design (as hereinafter
defined). Landlord shall have no obligation to make any such changes. If
Landlord, in its sole discretion, shall agree to any such change, Landlord shall
prepare Plans and Specifications and obtain an estimate of the cost for approval
by Tenant. Tenant shall pay, in advance, Landlord's estimate of any and all
costs of such changes (including without limitation the costs of labor,
materials, equipment, supervision and a management fee) subject to adjustment of
costs upon completion.
9.2 "Base Building Design" for purposes of the Article 9 shall be as
described in the Plans and Specifications for the Building current as of the
date of the Lease.
3.
42
occupied during the regular hours when janitorial service is provided.
Window cleaning shall be done only at the regular and customary times
determined by Landlord for such services provided such times will be
consistent with other comparable office buildings in the vicinity of
the Building.
10. The requirements of Tenants will be attended to only upon application
of Landlord. Employees of Landlord shall not perform any work or do
anything outside of their regular duties unless under special
instructions from Landlord.
11. The toilet rooms, urinals, wash bowls and other apparatus shall not be
used for any purpose other than that for which they were constructed
and no foreign substance of any kind whatsoever shall be thrown therein
and the expense of any breakage, stoppage, or damage resulting from the
violation of this rule shall be borne by the Tenant who, or whose
employees or invitees shall have caused it.
12. Each Tenant shall store all its trash and garbage within its premises.
No material shall be place in the hallways or in the trash boxes or
receptacles if such material is of such nature that it may not be
disposed of in the ordinary and customary manner of removing and
disposing of office building trash and garbage in the City of San Ramon
without being in violation of any law or ordinance governing such
disposal. All garbage and refuse disposal shall be made only through
entryways provided for such purposes and at such times as Landlord may
reasonably designate.
13. Tenant shall not park or attach any bicycle or motor driven cycle on or
to any part of the Building. No animals or birds shall be brought to or
kept in the Premises or Building with the exception of laboratory
rodents. Said rodents must be contained within Tenant's Premises.
14. The Tenant will keep all door openings to the exterior of the Building,
all fire doors and all smoke doors closed at all times.
15. Tenant agrees that it shall comply with all reasonable fire and
security regulations that may be issued from time-to-time by Landlord
and upon request Tenant also shall provide Landlord with the name of a
designated responsible employee to represent Tenant in all matters
pertaining to such fire or security regulations.
16. Landlord will furnish Tenant free of charge two keys to each door lock
provided within the premises by Landlord. Landlord may make a
reasonable charge for any additional keys. No additional locks shall be
placed by the Tenant on any door in the Building unless written consent
of the Landlord shall first have been obtained. A reasonable number of
keys to the demised premises and the toilet rooms will be furnished by
the Landlord, and neither the Tenant, its agents or employees shall
have any duplicate key made excepting that the Landlord shall when
deemed reasonable grant the Tenant the right to duplicate keys. At the
termination of this tenancy, the Tenant shall promptly return to the
Landlord all keys to doors in the Building.
17. Except as consented to in writing by Landlord or in accordance with
Building Standard Improvements, no draperies, curtains, blinds, shades,
screens or other devices shall be hung at or used in connection with
any window or exterior door or doors of the Building. Tenant
acknowledges that violation of this rule will directly and adversely
affect the exterior appearance of the Building.
18. Tenant will not place objects on window sills or otherwise obstruct the
exterior wall window covering.
19. (a) Furniture, equipment, large items or large quantities of items
shall be moved in or out of the Building only upon the advance
notification to the Landlord, and then only during such hours and in
such manner as may reasonably be prescribed by Landlord. The purpose of
this rule is to minimize disruption to other tenants during Ordinary
Business Hours.
1.
43
(b) No safe or article, the weight of which may constitute a hazard or
danger to the Building or its equipment, shall be moved into the
premises.
(c) Safes and other equipment, the weight of which is not excessive,
shall be moved into, from, or about the Building only during such hours
and in such a manner as shall be prescribed by the Landlord, and the
Landlord shall have the right to designated the location of such
articles in the Premises.
20. Canvassing, soliciting, distribution of handbills or any other written
material and peddling in the Building are prohibited, and each Tenant
shall cooperate to prevent the same.
21. Landlord reserves the right to exclude or expel from the Building any
person who, in the judgment of Landlord is intoxicated or under the
influence of liquor or drugs, or who shall in any manner do any act in
violation of any of the rules and regulations of the Building.
22. The bulletin board or directory of the Building shall be used primarily
for display of the name and location of Tenants and Landlord reserves
the right to exclude other names therefrom, to limit the number of
names associated with Tenant to be placed thereon at rates applicable
to all Tenants provided that Tenant's name shall be listed on the floor
directory.
23. Landlord shall have the right, exercisable without notice and without
liability to any Tenant, to change the name or street address of the
Building provided Landlord reimburses Tenant's reasonable costs
associated therewith (e.g., changing letterhead and business cards) not
to exceed $500.00. Without the written consent of Landlord, Tenant
shall not use the name of the Building complex in connection with or in
promoting or advertising the business of Tenant except as Tenant's
address.
24. These Rules and Regulations are in addition to, and shall not be
construed to in any way modify or amend, in whole or in part, the
agreements, covenants, conditions and provisions of any lease of
premises in the Building.
25. Landlord reserves the right to make such other rules and regulations as
in its judgment may from time-to-time be needed for the safety, care
and cleanliness of the Building and for the preservation of good order
therein, reasonably and uniformly enforced.
26. Landlord may waive any one or more of these Rules and Regulations for
the benefit of any particular Tenant or Tenants, by no such waiver by
Landlord shall be construed as a waiver of such Rules and Regulations
in favor of any other Tenants, nor prevent Landlord from thereafter
enforcing any such Rules and Regulations against any or all Tenants of
the Building.
27. Tenant shall be liable to Landlord and to each other Tenant of the
Building for any loss, cost, expense, damage or liability, including
attorneys' fees, caused or occasioned by the failure of Tenant to
comply with these rules, but Landlord shall have no liability for
failure or for failing or being unable to enforce compliance therewith
by any Tenant and such failure by Landlord of non-compliance by any
other Tenant shall not be a ground for termination by Tenant of the
lease to which these rules and regulations are attached.
28. Subject to paragraph 4.4 of the Lease, all approved signs or lettering
on doors shall be printed, painted, affixed or inscribed at the expense
of Tenant by a person approved by Landlord.
29. Tenant's lighting and electrical load shall not exceed the lesser of 8
watts per square foot of usable area or the maximum allowed by law.
2.
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30. In the event of any inconsistency between the provisions of the Lease
and these Rules and Regulations the Lease Provisions shall prevail.
3.
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EXHIBIT E
RULES & REGULATIONS
FOR TENANT'S CONTRACTOR(S)
1. Tenant's contractor will be responsible for making arrangements with
Landlord as to time for the use of services required. The delivery of
materials, equipment, etc., to the site must be coordinated with
Landlord, and the building debris box is not to be used for waste
removal.
2. Tenant's contractor shall not interfere with the landlord's contractor
and sub-trades in any way and will cooperate fully with same.
3. All contractor's garbage must be removed from the premises and site
regularly and promptly. All combustible garbage must be stored in a
covered, fire-proof container prior to removal.
4. Tenant's contractor and sub-trades shall take all precautions to ensure
the security and the site condition of the Premises and Building in
which the work is being performed, including their own tools, equipment
and materials, and are responsible for any damage caused by employees
and sub-trades to any part of the building.
5. Under no circumstances may the washrooms or janitor's sinks be used for
cleaning tools, equipment, etc.
6. Tenant's contractor will carry out the work during the hours reasonably
specified by Landlord and shall not create or cause any obstructions to
other contractors or tenants in the building. Tenant's contractor will
perform the work in such a manner that is not conflicting with the
normal building operations or procedures. Tenant's contractor shall not
in any way overload the structure and, in particular, shall not stack
materials thoughtlessly in this regard. Materials shall not be stored
in the Common Areas.
7. Tenant's contractor shall remove and properly replace underfloor duct
access covers as required for Tenant's trades and services.
8. Tenant's contractor must provide their own fire protection equipment,
have same on premises at all times and conform to any requirements of
Landlord or Landlord's contractor regarding fire protection.
9. Tenant's contractor shall carry out all work in compliance with all
Federal, State, County and City Building Codes and applicable Acts,
Ordinances and Statutes.
10. Tenant's contractor shall provide all their own protective devices and
coverings, so as to protect the building finishes provided by Landlord
in the Building.
11. No attachments to or use of window frames an mullions, ceiling systems
or building frame, will be permitted without the expressed written
consent of Landlord.
12. Tenant's contractors, employees and trades must be confined to the area
in which work is being performed.
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EXHIBIT F
BISHOP RANCH CC&R'S
2.
47
below the land surface, including but not limited to, buildings, utility
systems, walkways, driveways, parking areas, loading areas, landscaping items,
fences, walls, decks, stairs, poles, landscaping vegetation, signs, exterior
fixtures and any other structure of any type or kind.
1.5 "Lot" shall mean any numbered lot or parcel shown upon a recorded
subdivision map or recorded parcel map of all or a portion of the Properties.
1.6 "Mortgage" - "Mortgagee" - "Mortgagor." A mortgage shall mean any
mortgage or deed of trust or other conveyance of a Lot to secure the performance
of an obligation which will be void and reconveyed upon completion of such
performance. Reference in this Declaration to a mortgagee shall be deemed to
include the beneficiary of a deed of trust; reference to a mortgagor shall be
deemed to include the trustor of a deed of trust.
1.7 "Owner" shall mean the person, including Declarant, holding fee
simple interest of record to any Lot, including sellers under recorded executory
contracts of sale, but excluding those having such interest merely as security
for the performance of an obligation. For purposes of Section 3 only, unless the
context otherwise requires, Owner shall also include the guests, invitees,
licensees and lessees of any Owner.
1.8 "Person" shall mean a natural individual or any other entity with
the legal right to hold title to real property.
1.9 "Properties" shall mean all the real property described in Exhibit
A to this Declaration.
1.10 "Record" - "File" shall mean, with respect to any document, the
recordation thereof, and with respect to any map, the filing thereof, in the
Office of the Recorder of Contra Costa County, State of California.
1.11 "Street" shall mean any street, drive way, lane, place or other
thoroughfare either as shown on a recorded subdivision map or recorded parcel
map of all or a portion of the Properties.
2. ANNEXATION OF ADDITIONAL PROPERTY
2.1 Description. Declarant may, at any time during the term of this
Declaration, add all or a portion of the real property, owned by it or the
affiliated entities, described in Exhibit B and incorporated herein by this
reference, to the Properties which are covered by this Declaration upon the
filing of a Notice of Annexation as provided for in Paragraph 2.2. In addition
to the affiliated entities described in Exhibit B "affiliated entities" shall
include any persons having any ownership interest in Declarant or any
corporation, partnership, or other entity in which ten percent (10%) or more of
the ownership interests are held by Declarant or any of the persons having an
ownership in Declarant.
2.2 Notice of Annexation. The Notice of Annexation shall contain the
following information:
(a) A reference to this Declaration and applicable recording
information;
(b) A statement that the provisions of this Declaration, or some
specified provisions thereof, shall apply to such annexed real property;
(c) A legal description of the real property being annexed; and
(d) Such other or different covenants, conditions and restrictions,
if any, as may be specified by Declarant in its sole discretion, to regulate and
control the use, occupancy and improvement of the real property being annexed.
3.
48
3. USE RESTRICTIONS
3.1 Permitted Uses. All Lots in the Properties shall be used for the
following purposes:
(a) Agricultural: crop and tree farming, truck farming,
horticulture, viticulture and grazing;
(b) Administrative offices;
(c) Medical and dental offices and clinics, and professional
offices of architects, attorneys and engineers;
(d) Research laboratories and institutes;
(e) Electronic products manufacturing;
(f) Electrical products and instrument manufacturing;
(g) Bookbinding, printing and lithography;
(h) Cartography;
(i) Editorial and designing;
(i) Photographic printing, finishing and processing;
(k) Household pottery;
(l) Storage warehouses;
(m) Finished paper products;
(n) Garment manufacturing;
(o) Furniture upholstering.
Any other use consistent and harmonious to the foregoing uses, and otherwise
lawful under C-M Zoning (Controlled Manufacturing) may be permitted as
determined, in its sole discretion, by the Architectural Control Committee.
No part of the Properties shall ever be used or caused to be used or allowed or
authorized in any way, directly or indirectly, for any residential or other
nonbusiness purpose. All permitted uses shall be performed and carried out
entirely within a building in such a manner that the enclosed operations and
uses do not cause or produce a nuisance to other portions of the Properties,
such as, but not limited to, vibration, sound, electromechanical disturbance and
radiation, electromagnetic disturbance, radiation, air or water pollution, dust
or emission of odors, toxic or nontoxic matter.
3.2 Other Operations and Uses. Operations and uses that are not
specifically authorized by this Declaration may be permitted if written
operational plans and specifications for such operations or uses, containing
such information as may be requested by the Architectural Control Committee, are
submitted to and approved in writing by the Architectural Control Committee,
which approval shall be based upon analysis of the anticipated effect of such
operations or uses upon other Lots, upon other real property in the vicinity of
the Properties, and upon the occupants thereof, but shall be in the sole
discretion of the Architectural Control Committee.
3.3 Nuisances. No noxious or offensive trade or activity shall be
carried on upon any Lot or any part of the Properties, nor shall anything be
done thereon which may be, or may become, an annoyance or nuisance to the
neighborhood, or which shall in any way
4.
49
interfere with the quiet enjoyment of each of the Owners of his respective Lot.
In this regard, all noises, sounds and vibrations shall be appropriately muffled
in such a manner so as not to be objectionable as to intermittent beat,
frequency, shrillness or volume. Every use shall be operated in such a manner
that the ground vibration, heat and glare inherently and recurrently generated
from such use is not perceptible beyond the foundation or perimeter line of the
building in which the use is located. Spotlights, floodlights and other methods
of illumination may be used to illuminate buildings, landscaping areas, signs
and parking areas, provided that such devices are equipped with proper lenses
concentrating the illumination upon such structures and areas preventing any
bright or direct illumination upon adjacent Lots or upon any Street, whether
public or private, and provided further that any such illumination shall first
be approved by the Architectural Control Committee. No livestock, poultry or
animals of any kind shall be raised, bred, kept, slaughtered, or rendered upon
any portion of the Properties. A "nuisance" shall include, without limitation,
any of the following conditions:
(a) Emission of dust, sweepings, dirt, or cinders into the
atmosphere, or discharges of liquid, solid wastes, or other harmful matter into
any stream, river, or other body of water if such emission or discharge may
adversely affect the use or intended use of any property or may adversely affect
the health, safety, or comfort of persons in the vicinity, or discharge of waste
or any substance or material of any kind into any public or privately maintained
sewer serving the Properties, or any part thereof, in violation of any law,
rule, or regulation of any public body having jurisdiction thereof;
(b) Escape or discharge of fumes, odors, gases, vapors, acids, or
other substances into the atmosphere if such escape or discharge may be
detrimental to the health, safety, or welfare of persons, may interfere with the
comfort of persons within the vicinity, or may be harmful to property or
vegetation;
(c) The perception, at any point outside the boundaries of a
building on any Lot, whether at, above or below ground level, of noise from any
activity, machine, device, or combination thereof located on that Lot that
unreasonably interferes with the use or enjoyment of any other Lot, except noise
from motor vehicles;
(d) Wind-borne dust, sprays, or mists and visible emissions of
smoke originating on a Lot in unreasonable amounts, excluding the exhausts
emitted by motor vehicles, but including emissions from the disposal of trash
and waste materials; or
(e) Ground vibrations inherently and recurrently generated on a
Lot that are perceptible without instruments at any point outside the boundaries
of the building located on such Lot, whether at, above or below ground level.
3.4 Signs. No sign, poster, billboard or other advertising of any kind
shall be permitted on any portion of the Properties, except such signs as are
approved in writing by the Architectural Control Committee, provided that
Declarant reserves the right to locate on the Properties or any portion thereof
such signs identifying the name, business or products of the businesses located
on the Properties. Declarant by such reservation is not obligated to provide any
such signs. Signs subject to the approval of Architectural Committee may
identify the name, business or products of each such business and shall only be
of a size, design, color, style and illumination as shall be specifically
approved in writing by the Architectural Control Committee. Each Owner shall
have the right to display upon his Lot or building a sign of reasonable
dimensions, as determined in advance by the Architectural Control Committee,
advertising that the Lot or some portion thereof is for sale, lease, or
exchange.
3.5 Mineral Exploration. No oil development operations, oil refining,
quarrying or mining operations of any kind shall be permitted upon or in any
Lot, nor shall oil wells, tanks, tunnels or mineral excavations or shafts be
permitted upon or below the surface of any Lot unless commencing at least five
hundred (500) feet below the surface of the Properties.
3.6 Antennae. No television, radio or other electronic antenna or
device of any type shall be erected, constructed, placed or permitted to remain
on any of the buildings,
5.
50
structures or other Improvements constructed on the Lots unless and until the
same shall have been approved in writing by the Architectural Control Committee.
3.7 Drainage. There shall be no interference with the established
drainage pattern over any portion of the Properties unless adequate provision is
made for proper drainage and is approved by the Architectural Control Committee.
For the purposes hereof, "established" drainage is defined as the drainage which
exists at the time the Properties are improved pursuant to the terms and
conditions of any plans approved by the Architectural Control Committee.
3.8 Refuse. All rubbish, trash, garbage and other waste (collectively
"refuse") shall be regularly removed from each Lot. All outdoor refuse
collection areas shall be visually screened so as not to be visible from any
street and from any of the Lots. The location of all refuse areas shall be
approved by the Architectural Control Committee. No refuse collection areas
shall be permitted between a street and the front of a building.
3.9 Temporary Structures and Obstructions. No structure of a temporary
character, trailer, camper, boat or similar equipment shall be permitted to
remain upon any Lot, without the prior written approval of the Architectural
Control Committee. There shall be no obstruction of any walkway or driveway in
the Properties which would interfere with the circulation of foot or automobile
traffic except such obstruction as may be reasonably required in connection with
repairs of such driveways and walkways.
3.10 Leases. This Declaration is intended to be binding upon any lessee
or tenant of any Lot, or portion thereof. In order to ensure the binding effect
on tenants and lessees, each Owner agrees, by acceptance of a deed by which he
acquires a title to a Lot, not to rent or lease all or any portion of his Lot to
any person, partnership, corporation, trust, or other entity except pursuant to
a written lease or rental agreement that (a) expressly refers to this
Declaration and contains a covenant by the lessee or tenant that he accepts the
leasehold estate subject to this Declaration, and (b) contains either a covenant
that the lessee or tenant agrees to perform and comply with the restrictions
herein or adequate provisions to permit entry and other actions by the lessor
for the purpose of performing and complying with these restrictions.
4. ARCHITECTURAL, DEVELOPMENT AND LANDSCAPING PROVISIONS
4.1 Architectural Control Committee. So long as Declarant owns a Lot
subject to this Declaration, the functions of the Architectural Control
Committee shall be performed by Declarant. The provisions of Paragraphs 4.2
through 4.6 shall not apply to Declarant so long as Declarant is performing the
function of the Architectural Control Committee. Declarant may delegate such
functions to one or more individuals, each individual having the full power to
bind Declarant In performing the functions of the Architectural Control
Committee. Such individual or individuals shall be designated in a written
notice recorded by Declarant, which notice shall refer to this Declaration and
shall further specify that the named individuals are being named pursuant to the
provisions of this Paragraph 4.1. At such time that Declarant no longer owns a
Lot subject to this Declaration or at such earlier time that Declarant no longer
desires to perform the functions of the Architectural Control Committee, then
upon the occurrence of either event, Declarant shall record and concurrently
mail to each Owner a written notice of such event. Such notice shall also
designate three (3) individuals who will be the initial members of the
Architectual Control Committee. Such individuals shall have the qualifications
as provided for in Paragraph 4.3.
4.2 Number, Selection and Term of Members of Architectural Control
Committee. After Declarant ceases to perform the functions of the Architectual
Control Committee, the Architectual Control Committee shall be composed of three
(3) members, with the first members being selected by Declarant pursuant to
Paragraph 4.1. Each member shall continue on the Architectual Control Committee
until removed or replaced as provided for in this Declaration.
4.3 Removal and Selection of Members By Owners. Owners of at least
sixty-six and two-thirds percent (66-2/3%) of the Properties then subject to
this Declaration based
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upon the total number of acres owned as compared to the total number of acres
subject to this Declaration (excluding dedicated streets) shall have the right,
by recorded written notice executed by such owners, to remove and select one or
more of the members of the Architectual Control Committee, or to fill a vacancy
that occurs pursuant to Paragraph 4.5 and remains unfilled for a period of
thirty (30) days. Such recorded written notice shall specify the member being
replaced and the name and address of the individual selected to the Architectual
Control Committee and a copy shall be mailed to all Owners not a party to such
notice.
4.4 Qualifications of Members. Each member of the Architectural Control
Committee shall be an Owner, or an officer, director, shareholder, manager or
employee of an Owner or shall be a qualified architect, engineer or land
planner. No Owner shall have more than one member on the Architectual Control
Committee. No Member shall receive any salary or compensation for his services
as a Member but may be reimbursed for out-of-pocket expenses incurred in
performing duties on behalf of the Architectural Control Committee.
4.5 Vacancies. A vacancy in the Architectural Control Committee shall
exist in the event of the death or resignation of any member or if the
authorized number of members is increased by an amendment to this Declaration.
The members of the Architectural Control Committee shall have the right to
declare an office of a member vacant by a vote of more than fifty percent (50%)
of the other members, if a member is found to be of unsound mind by a court,
convicted of a felony, or if within thirty (30) days after his election fails to
accept such office in writing. Any vacancy occurring may be filled by a vote of
a majority of more than fifty percent (50%) of the remaining members, even
though they are less than a quorum. Written notice of any change in the members
of the Architectural Control Committee shall be recorded and a copy mailed to
each Owner. Such recorded written notice shall specify the member being replaced
and the name and address of the individual selected to the Architectural Control
Committee.
4.6 Meetings, Quorum and Rules. Meetings may be called by any member of
the Committee as reasonably necessary to perform the functions of the
Architectural Control Committee under this Declaration. Any matters required to
be reviewed or approved by the Architectural Control Committee may be presented
to any member who shall then call a meeting of the Architectural Control
Committee upon at least forty-eight (48) hours prior notice to the other members
either by written notice or telephonic communication. A majority of the
authorized number of members constitutes a quorum of the Architectural Control
Committee and every act or decision done or made by a majority of the members
present is the act of the Architectural Control Committee. The members may adopt
by a majority vote of all the members such additional rules and procedures for
the running of the Architectural Control Committee, which rules shall be made
available to all Owners upon request.
4.7 Approval of Plans. No improvement shall be erected, placed,
altered, remodeled, modified, removed, maintained or permitted to remain on any
of the Properties subject to this Declaration until plans and specifications
shall have been submitted to and approved in writing by the Architectural
Control Committee. Such plans and specifications shall be submitted in writing
in duplicate over the authorized signature of the Owner, lessee, licensee or
other occupant of the Lot or his authorized agent. Such plans and specifications
shall be in such form and shall contain such information as may be required by
the Architectural Control Committee, but in any event shall include:
(a) A site development plan of the Lot showing the nature, grading
scheme, drainage plan, shape, materials and location with respect to the
particular Lot (including proposed front, rear and side setback lines) of all
structures, the location thereof with reference to structures on adjoining
portions of the property, and the number and location of all parking spaces and
driveways on the site;
(b) a landscaping plan for the particular site;
(c) A signing and lighting plan; and
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(d) A building elevation plan showing dimensions, materials and
exterior color scheme and be in no less detail than required by the appropriate
governmental authority for the issuance of a building permit. Any changes in
approved plans which materially affect building size, placement or external
appearance shall be similarly submitted to and approved by the Architectural
Control Committee.
No improvement or structure shall be erected or placed on any Lot resulting from
the rearrangement or resubdivision of any of the Lots initially subject to this
Declaration or annexed pursuant to Section 2 unless approved by the Architectual
Control Committee in its sole discretion, provided that two or more Lots or
portions thereof may be combined to create one Lot and provided that three or
more Lots may be combined and resubdivided into Lots none of which shall contain
a lesser amount of square footage or less frontage than the smallest of such
Lots prior to such resubdivision.
4.8 Basis for Approval. Approval shall be based, among other things, on
adequacy of site dimensions, coverage, adequacy of structural design, conformity
and harmony of external design with neighboring structures, effect of location
and use of proposed improvements on neighboring sites, proper facing of main
elevation with respect to nearby streets, adequacy of screening of mechanical
air conditioning or other roof top installations, and conformity of the plans
and specifications to the purpose and general plan and intent of this
Declaration. No plans will be approved which do not provide for the underground
installation of power, electrical, telephone and other utility lines from the
property line to buildings. The Architectural Control Committee shall not
arbitrarily or unreasonably withhold its approval of such plans and
specifications.
4.9 Approval Process. Upon approval by the Architectural Control
Committee of any plans and specifications submitted hereunder, a copy of such
plans and specifications as approved, shall be deposited for permanent record
with the Architectural Control Committee, and a copy of such plans and
specifications bearing such approval, in writing, shall be returned to the
applicant submitting the same. If the Architectural Control Committee fails
either to approve or disapprove such plans and specifications within thirty (30)
days after the same have been submitted to it, it shall be conclusively presumed
that the Architectural Control Committee has approved said plans and
specifications; provided, however, that if within said 30-day period, the
Architectural Control Committee gives written notice of the fact that more time
is required for the approval of such plans and specifications, there shall be no
presumption that the same are approved until the expiration of a reasonable
period of time as set forth in said notice.
4.10 Proceeding With Work. Upon receipt of approval from the
Architectural Control Committee pursuant to this Section 4, the Owner or lessee
to whom the same is given shall as soon as practicable, satisfy all conditions
thereof and diligently proceed with the commencement and completion of all
approved construction, refinishing, alterations and excavations. In all cases
work shall be commenced within one (1) year from the date of such approval, if
there is a failure to comply with this Paragraph 4.10, then the approval given
shall be deemed revoked unless the Architectural Control Committee upon request
made prior to the expiration of said one (1) year period extends the time for
commencing work.
4.11 Completion of Work. In any event, reconstruction, refinishing or
alteration of any improvement shall be completed within two (2) years after the
commencement thereof except for so long as such completion is rendered
impossible or would result in great hardship due to strikes, fires, national
emergencies, natural calamities or other supervening forces beyond the control
of the Owner, lessee, licensee or occupant or his agents. Failure to comply with
this paragraph shall constitute a breach of this Declaration and subject the
defaulting party or parties to all enforcement procedures set forth in this
Declaration and any other remedies provided by law or in equity.
4.12 Liability. The Architectural Control Committee shall not be liable
for any damage, loss or prejudice suffered or claimed on account of:
(a) The approval or disapproval of any plans, drawings and
specifications, whether or not defective;
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(b) The construction or performance of any work, whether or not
pursuant to approved plans, drawings and specifications; or
(c) the development of any property within the Properties.
4.13 Review Fee. An architectural review fee shall be paid to the
Architectural Control Committee at such time as plans and specifications are
submitted for approval and in such amounts as shall be established by a schedule
adopted from time to time by the Architectural Control Committee based on
reasonable costs incurred by the Architectural Control Committee for such
review.
4.14 Construction Without Approval. If any improvement shall be
altered, erected, placed or maintained upon any Lot, or any new use commenced on
any lot, otherwise than in accordance with the approval by the Architectural
Control Committee pursuant to the provisions of this Section 4, such alteration,
erection, maintenance or use shall be deemed to have been undertaken in
violation of this Section 4 and without the approval required herein, and upon
written notice from the Architectural Control Committee, any such structure so
altered, erected, placed or maintained upon any lot in violation hereof shall be
removed or re-altered, and any such use shall be terminated so as to extinguish
such violation. If within fifteen (15) days after the notice of such violation
the Owner of the Lot upon which such violation exists shall not have taken
reasonable steps toward the removal or termination of the same, the
Architectural Control Committee shall have the right, through its agents and
employees, to enter upon such Lot, subject to any security controls imposed by
the Government of the United States (or any agency thereof) with respect to any
operation being conducted thereon, and to take such steps as may be necessary to
extinguish such violation. The Architectural Control Committee or any such agent
shall not thereby be deemed to have trespassed upon such Lot and shall be
subject to no liability to the Owner or occupant of such Lot for such entry and
any action taken in connection with the removal of any violation. The cost of
any abatement or removal hereunder shall be a binding personal obligation of
such Owner as well as a lien (enforceable in the same manner as a mortgage) upon
the Lot in question. The lien provided in this Section shall not be valid as
against a bona-fide purchaser (or bona fide mortgagee) of a Lot in question
unless a suit to enforce said lien shall have been filed in a court of record in
Contra Costa County, California, prior to the recordation of the deed (or
mortgage) conveying the Lot in question to such purchaser (or subjecting the
same to such mortgage).
4.15 Minimum Setback Lines. No improvements of any kind, and no part
thereof, shall be placed closer than permitted by the Architectural Control
Committee to an interior property line but in no event closer than twenty (20)
feet. No improvements of any kind, and no part thereof, shall be placed closer
than thirty (30) feet from a property line fronting on any street as shown on a
map for all or a portion of the Properties.
4.16 Exceptions to Setback Requirements. The following structures and
improvements are specifically excluded from the foregoing setback requirements:
(a) Roof overhang subject to the specific approval of the
Architectural Control Committee in writing, provided it does not extend more
than six (6) feet into the setback area;
(b) Steps and walks;
(c) Paving and associated curbing except that vehicle parking area
shall not be permitted within five (5) feet of a property line fronting any
street;
(d) Fences, except that no fence shall be placed within the street
setback area unless specific approval is given by the Architectural Control
Committee in writing;
(e) Landscaping;
(f) Planters, not to exceed three (3) feet in height, unless
specific approval is given by the Architectural Control Committee in writing;
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(g) Signs identifying the Owner, lessee or occupant subject to the
specific approval of the Architectural Control Committee in writing; and
(h) Lighting facilities, subject to the specific approval of the
Architectural Control Committee in writing.
4.17 Landscaping. Every Lot on which a building shall have been placed
shall be landscaped in accordance with plans and specifications submitted to and
approved by the Architectural Control Committee pursuant to Section 4.
Landscaping as approved by the Architectural Control Committee shall be
installed within ninety (90) days of occupancy or completion of the building,
whichever occurs first, unless the Architectural Control Committee approves in
writing another completion date. After completion such landscaping shall be
maintained in a sightly and well-kept condition. The area of each site between
any street and any minimum setback line as defined by Paragraphs 4.15 and 4.16
shall be landscaped with an effective combination of street trees, trees, ground
cover and shrubbery. All other areas fronting on a street that are not utilized
for parking or driveways shall be landscaped in a similar manner. All areas of
each site not fronting on a street and not used for parking or storage shall be
landscaped utilizing ground cover and/or shrub and tree materials. Undeveloped
areas proposed for future expansion shall be maintained in a weed-free condition
and shall be landscaped if requested by the Architectural Control Committee.
Unpaved areas between the street curb line and the property line adjoining any
street shall be landscaped and maintained by Owner.
4.18 Maintenance of Landscaping. If, in the opinion and sole discretion
of the Architectural Control Committee, the required landscaping is not
maintained in a sightly and well-kept condition, the Architectural Control
Committee shall have the right, through its agents and employees, to enter onto
any site and to take such steps as may be necessary to maintain the landscaping
in a sightly and well-kept condition. The Architectural Control Committee, or
any such agent or employee, shall not thereby be deemed to have trespassed upon
such site and shall be subject to no liability to the Owner or occupant of such
site for such entry and any action taken in connection with such necessary
maintenance. The cost of any such maintenance hereunder shall be a binding
personal obligation of such Owner, as well as a lien (enforceable in the same
manner as a mortgage) upon the site in question. The lien provided in this
Section shall not be valid as against a bona fide purchaser (or bona fide
mortgagee) of a site in question unless a suit to enforce said lien shall have
been filed in a court of record in Contra Costa County, California, prior to the
recordation of a deed (or mortgagee) conveying the site in question to such
purchaser (or subjecting the same to such mortgage).
4.19 Adequate Parking Areas. Adequate off-street parking shall be
provided to accommodate all parking needs for employee, visitor and company
vehicles on the Lot. The intent of this provision is to eliminate the need for
any on-street parking; provided that this provision does not prohibit on-street
parking of public transportation vehicles. If parking requirements increase as a
result of a change in use or number of employees, additional off-street parking
shall be provided to satisfy the intent of this Paragraph. Required off-street
parking shall be provided on the site of the use served. Where parking is
provided on other than the Lot concerned, a recorded document shall be filed
with the Architectural Control Committee and signed by the Owners of the
alternate site stipulating to the permanent reservation of the use of the site
for said parking.
4.20 Paved Parking Areas. Parking areas shall be paved so as to provide
dust- free, all-weather surfaces. Each parking space provided shall be
designated by lines painted on the paved surfaces and shall be adequate in area,
and all parking areas shall provide, in addition to parking spaces, adequate
driveways and space for the movement of vehicles. The number of parking spaces
required for each site, and the specific location of the same, shall be
designated in plans for each Lot which have been submitted and approved in the
manner set forth herein. In determining the number of parking spaces and the
location thereof of each site, the Architectural Control Committee shall
consider the exact nature of the use proposed for the site; the anticipated
number and manner of employment of persons on the site; the nature and location
of proposed structures on the site; and such other matters as the Architectural
Control Committee shall deem relevant. No parking spaces shall be located on,
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and no parking shall be permitted by the Architectural Control Committee within
designated setback areas adjacent to any street except that parking may be
permitted by the Architectural Control Committee within said setback area when
such parking is screened from view from the street by approved trees, screen
wall, shrubbery or berms.
4.21 Storage and Loading Areas. Unless specifically approved by the
Architectural Control Committee in writing, no materials, supplies or equipment,
including company-owned or operated trucks and motor vehicles, shall be stored
in any area on a site except inside a closed building, or behind a visual
barrier screening such areas so that they are not visible from the neighboring
properties or public streets to a person six (6) feet tall standing at ground
level on such neighboring properties or public streets. Any storage areas
screened by visual barriers shall be located on the rear portions of the site,
unless approved by the Architectural Control Committee in writing. No storage
areas shall extend into setback lines as established herein unless approved by
the Architectural Control Committee in writing. All provisions for vehicle
loading shall be provided on the site with on-street vehicle loading not
permitted. No loading dock or trucking activity shall be permitted between the
structure and any street, and no loading area shall encroach into setback areas
unless specifically approved by the Architectural Control Committee. Loading
dock areas shall be set back and screened so as not to be visible from
neighboring properties and streets. No storage areas, loading docks, truck or
loading activity shall be permitted on a Lot adjoining Interstate Highway 680
unless specifically approved by the Architectural Control Committee.
5. PROTECTION OF FIRST MORTGAGEES
A breach of any of the provisions, covenants, restrictions or
limitations hereof, or the recordation of any assessment lien or the pursuit of
any remedy hereunder, shall not defeat or render invalid the lien of any first
Mortgage of record (meaning any recorded Mortgage or deed of trust with first
priority or security over other Mortgages or deeds of trust) made with an Owner
in good faith and for value upon the Lot of such Owner. All of the provisions
herein shall be binding upon and effective against any Owner whose title to said
Lot is hereafter acquired through foreclosure or trustee's sale. Each first
Mortgagee of a Mortgage encumbering any Lot in the Properties, which obtains
title to such Lot pursuant to the remedies provided in such Mortgage, by
judicial foreclosure or by deed or assignment in lieu of foreclosure, shall take
title to such Lot free and clear of any claims for unpaid assessments or
charges, if any, against such Lot which accrued prior to the time such holder
acquires title to such Lot.
6. DURATION AND AMENDMENT
6.1 Duration. This Declaration shall continue in full force for a term
of fifty (50) years from the date hereof, after which time the same shall be
automatically extended for successive periods of ten (10) years, unless a
Declaration of Termination is recorded in the Official Records, Contra Costa
County, California, meeting the requirements of an amendment to this Declaration
as set forth in Paragraph 6.2.
6.2 Amendment. This Declaration or any provision thereof, or any
covenant, condition or restriction contained herein may be terminated, extended,
modified or amended, as to all or any portion of the Properties, with the
written consent of the Owners of sixty-six and two-thirds percent (66-2/3%) of
the real property then subject to this Declaration based on the number of acres
owned as compared to the total number of acres subject to this Declaration
(excluding dedicated streets), provided, however, that so long as Declarant owns
a Lot subject to the Declaration or for a period of fifteen (15) years from the
date of recordation of this Declaration, whichever period is longer, no such
termination, extension, modification or amendment shall be effective without the
written consent of the Declarant thereto. No such termination, extension,
modification or amendment shall be effective until a proper instrument in
writing has been executed, acknowledged and recorded. Notwithstanding the
foregoing, any of the following modifications or amendments, to be effective,
must be approved in writing by all of the institutional Mortgagees holding first
Mortgages encumbering the Lots in the Properties:
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(a) Any amendment or modification which affects or purports to
affect the validity or priority of encumbrances or the rights, or protection
granted to encumbrancers as provided in Section 5 hereof; or
(b) Any amendment or modification which would or could result in an
encumbrance being cancelled by forfeiture.
7. GENERAL PROVISIONS
7.1 Legal Proceedings. Failure to comply with any of the terms of this
Declaration, by an Owner, his guests, employees, invitees or tenants, shall be
grounds for relief which may include, without limitation, an action to recover
sums due for damages, injunctive relief, foreclosure of lien, or any combination
thereof, which relief may be sought by Declarant, the Architectural Control
Committee, or, if appropriate, by an aggrieved Owner. Failure to enforce any
provision hereof shall not constitute a waiver of the right to enforce said
provision, or any other provision hereof. The Declarant, the Architectural
Control Committee, any Owner (not at the time in default hereunder), shall be
entitled to bring an action for damages against any defaulting Owner, and in
addition may enjoin any violation of this Declaration. Any judgment rendered in
any action or proceeding pursuant thereto shall include a sum for attorneys'
fees in such amount as the Court may deem reasonable, in favor of the prevailing
party. Each remedy provided for in this Declaration shall be cumulative and not
exclusive or exhaustive.
7.2 Severability. The provisions hereof shall be deemed independent and
severable, and a determination of invalidity or partial invalidity or
unenforceability of any one provision or portion hereof by a court of competent
jurisdiction shall not affect the validity or enforceability of any other
provisions hereof.
7.3 Interpretation. The provisions of this Declaration shall be
liberally construed to effectuate its purpose of creating a uniform plan for the
creation and operation of an industrial and business park development and any
violation of this Declaration shall be deemed to be a nuisance. The section and
paragraph headings, titles and captions have been inserted for convenience only,
and shall not be considered or referred to in resolving questions of
interpretation or construction. As used herein, the singular shall include the
plural and the masculine, feminine and neuter shall mean the same. This
Declaration shall be construed and enforced in accordance with the laws of the
State of California.
7.4 Construction and Sales by Declarant. Nothing in this Declaration
shall limit, and no Owner shall do anything which shall interfere with, the
right of Declarant to complete any construction of improvements on the Lots
owned by Declarant, or to alter the foregoing and its construction plans and
designs, or to construct such additional improvements on such Lots as Declarant
deems advisable prior to completion and sale of the last Lot in the Properties.
Each Owner by accepting a deed to a Lot hereby acknowledges that the activities
of Declarant may constitute a temporary inconvenience or nuisance to the Owners
and hereby consents to such inconvenience or nuisance. Each Owner hereby grants,
upon acceptance of his deed to his Lot, an irrevocable, special power of
attorney to Declarant to execute and record all documents and maps necessary to
allow Declarant to exercise its rights under this Paragraph 7.4. Such right
shall include, but shall not be limited to, erecting, constructing and
maintaining on the Properties such structures and displays as may be reasonably
necessary for the conduct of its business of completing the work and disposing
of the same by sale, lease or otherwise. Declarant may use any Lots owned by
Declarant in the Properties as models or real estate sales or leasing offices.
This Declaration shall not limit the right of Declarant at any time prior to
acquisition of title to the last Lot in the Properties by a purchaser from
Declarant, to establish on the Lots owned by Declarant easements, reservations
and rights-of-way to itself, to utility companies, or to other Persons as may
from time to time be reasonably necessary to the proper development and disposal
of the Properties. Such easements may be created for the construction,
installation, maintenance, removal, replacement, operation and use of utilities,
including without limitation, sewers, water and gas pipes and systems, drainage
lines and systems, electric power and conduit lines and wiring, telephone
conduits, lines and wires, and other utilities, public or private, beneath the
ground surface (except vaults, vents, access structures and other facilities
12.
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required to be above ground surface by good engineering practice), including the
right to dedicate, grant or otherwise convey easements or rights-of-way to any
public utility or government entity for such purposes. All or any portion of the
rights of Declarant hereunder may be assigned to any successor or successors to
all or part of Declarant's respective interest in the Properties, or to any
other person designated by Declarant by an express written assignment recorded
in the Office of the Contra Costa County Recorder. Declarant need not seek or
obtain the approval of the Architectural Control Committee in connection with
any improvements constructed or altered by Declarant in the Properties.
7.5 No Public Right or Dedication. Nothing contained in this
Declaration shall be deemed to be a gift or dedication of all or any part of the
Properties to the public, or for any public use.
7.6 Designation of Owners Representative. Upon the conveyance of a Lot
to an Owner and on July 1, of each year, Owner shall provide by written notice
to the Architectual Control Committee the name of an individual and his address
who shall be the Owner's Representative. The Owner's Representative shall be
deemed to have the power to bind the Owner in connection with any matter arising
under this Declaration and any notice delivered to the Owner's Representative
shall be deemed notice to the Owner. Each Owner shall have the right to
designate a replacement Representative by compliance with the provisions of this
Paragraph 7.6.
7.7 Notices. Except as otherwise provided in this Declaration, in each
instance in which notice is to be given to an Owner, the same shall be in
writing and may be delivered personally to the Owner's Representative, as
designed pursuant to Paragraph 7.6. In the event that a Representative for an
Owner has not been designated, personal delivery of such notice to one or more
co-owners of a Lot or to any general partner of a partnership owning a Lot shall
be deemed delivery to all co-owners or to the partnership, as the case may be
and personal delivery of such notice to any officer or agent for the service of
process on a corporation shall be deemed delivery to the corporation. In lieu of
the foregoing, such notice may be delivered by regular United States mail,
postage prepaid, addressed to the Owner's Representative at the most recent
address furnished by such Owner or to the street address of such Owner's Lot.
Such notice shall be deemed delivered at the beginning of the second day after
the day of such mailing.
THIS DECLARATION has been executed on the date first written above.
GRANADA SALES, INC., a California
corporation
By _____________________________________
Alexander R. Mehran
Chief Executive Officer
By _____________________________________
Loree Cornwell
Secretary/Treasurer
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EXHIBIT G
Exhibit G consists of a drawing of the Building Interior Layout.
14.