Exhibit 10.2
LEASE
BETWEEN
PHOENIX INDUSTRIAL INVESTMENT PARTNERS, L.P.
AN ARIZONA LIMITED PARTNERSHIP
AS LANDLORD
AND
SPEEDFAM - IPEC, INC.,
AN ILLINOIS CORPORATION
AS TENANT
TABLE OF CONTENTS
PAGE
1. DEFINITIONS.......................................................... 1
2. LEASED PREMISES...................................................... 4
3. TERM................................................................. 4
4. RENT................................................................. 4
5. ADDITIONAL CHARGES................................................... 5
6. LATE CHARGES AND INTEREST............................................ 5
7. USE OF LAND PREMISES................................................. 6
8. TRIPLE NET LEASE..................................................... 6
9. MAINTENANCE AND REPAIRS.............................................. 6
10. TENANT'S EQUIPMENT................................................... 7
11. ALTERATIONS AND ADDITIONS............................................ 7
12. IMPOSITIONS.......................................................... 10
13. COMPLIANCE WITH REQUIREMENTS......................................... 10
14. LIENS................................................................ 10
15. PERMITTED CONTESTS................................................... 11
16. NO CLAIMS AGAINST LANDLORD........................................... 11
17. INDEMNIFICATION BY TENANT............................................ 11
18. UTILITIES............................................................ 12
19. INSURANCE............................................................ 12
20. DAMAGE TO OR DESTRUCTION OF LEASED PREMISES.......................... 15
21. EMINENT DOMAIN....................................................... 16
22. PERFORMANCE ON BEHALF OF TENANT...................................... 18
23. ASSIGNMENTS AND SUBLEASES............................................ 18
24. EVENTS OF DEFAULT; TERMINATION....................................... 24
25. ESTOPPEL CERTIFICATES AND FINANCIAL STATEMENTS ...................... 29
26. SUBORDINATION AND ATTORNMENT......................................... 31
27. OPTIONS TO EXTEND.................................................... 31
28. APPRAISAL............................................................ 32
29. RIGHT OF ENTRY....................................................... 33
30. NOTICES.............................................................. 33
31. SURRENDER............................................................ 34
32. BROKER............................................................... 34
33. WAIVER............................................................... 35
34. NO PARTNERSHIP....................................................... 35
TABLE OF CONTENTS
PAGE
35. PARTIAL INVALIDITY................................................... 35
36. RECORDING............................................................ 35
37. HAZARDOUS MATERIALS.................................................. 35
38. HOLDING OVER......................................................... 39
39. AUTHORITY............................................................ 39
40. PARKING.............................................................. 39
41. QUIET TITLE ......................................................... 39
42. BENEFIT.............................................................. 39
43. SIGNAGE.............................................................. 39
44. TELECOMMUNICATIONS................................................... 39
45. APPROVALS AND CONSENTS............................................... 40
46. SECURITY DEPOSIT..................................................... 40
47. MISCELLANEOUS........................................................ 40
LEASE
THIS LEASE is made and entered into as of the ______ day of
________________, 2002, ("LEASE EXECUTION DATE") by and between Phoenix
Industrial Investment Partners, L.P., an Arizona limited partnership
(hereinafter called "LANDLORD"), and SpeedFam - IPEC, Inc., an Illinois
corporation (hereinafter called "TENANT").
RECITALS
A. Concurrently herewith, Landlord purchased from Tenant that certain
real property commonly known as 300 North 56th Street and 305 North
54th Street, Chandler, Arizona, more fully described on the attached
Exhibit A ("PROPERTY ").
B. As part of the aforementioned acquisition, Landlord desires to lease
to Tenant, and Tenant desires to lease from Landlord, the Leased
Premises (as defined hereinafter) upon the terms and conditions
hereof.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:
W I T N E S S E T H:
In consideration of the mutual covenants hereinafter set forth, the
parties hereto agree as follows:
1. DEFINITIONS. As used in this Lease the following terms shall have
the following respective meanings:
a. Additional Charges: as defined in Section 5.
b. Affiliate, Subsidiary or Successor: as defined in Section 23.
c. Alteration or Alterations: as defined in Section 11.
d. Appraisal: as defined in Section 28.
e. Base Rent: as defined in Section 4.
f. Business Days: any day which is not a Saturday, Sunday or
federal, state or local holiday.
g. Capital Improvement: as defined in Section 9.
h. Cost(s) and Expense(s): all costs, expenses and fees of every
kind and nature, including without limitation reasonable
attorneys' fees, court costs, experts' fees, consultants' fees
and all other expenses arising from or connected with
threatened or pending actions, suits, claims, demands or
proceedings.
i. Default: as defined in Section 24.
j. Default Rate: the lesser of (i) four (4) points above the then
prime rate of interest as announced from time to time by Bank
One, Arizona, NA, a national banking association, or its
successor; and (ii) the highest rate permitted by applicable
law.
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k. Fair Market Rental: as defined in Section 28.
l. Hazardous Materials: as defined in Section 37.
m. Impositions: Any of the following which at any time during or
in respect of the Lease Term may be charged, assessed, levied,
confirmed or imposed on or be a lien upon (y) the Leased
Premises or any part thereof or any Rent or other payments
paid to Landlord pursuant to this Lease or subleases of the
Leased Premises, or any part thereof, by anyone claiming by,
through or under Tenant; or (z) any occupancy, use or
possession of or activity conducted on the Leased Premises or
any part thereof: all taxes including, without limitation, (i)
Real Property Taxes; (ii) sales, transaction privilege,
license, excise, rent or similar taxes and whether imposed on,
or measured by, the Rent, Additional Charges or other payments
or consideration in any form for which Tenant is obligated by
reason of the privilege of renting or of Tenant's occupancy
hereunder, and (iii) all new taxes imposed, levied or charged
in lieu of or in addition to existing taxes by virtue of
present or future law or governmental authority in connection
with the ownership, use, occupancy or possession of the Leased
Premises as measured by the Rents, Additional Charges or other
payments herein provided to be paid by Tenant, or otherwise,
assessments (including without limitation, all assessments for
public improvements or benefits, whether or not commenced or
completed prior to the date hereof and whether or not to be
completed within the term hereof, ground rents, contract
payments, water, sewer, utility or similar rents, rates and
charges, excises, levies, license fees, permit fees,
inspection fees and other authorization fees, other charges
and other governmental impositions in each case, whether
general or special, ordinary or extraordinary, foreseen or
unforeseen, of every kind and character (including all
interest and penalties thereon). Notwithstanding anything
hereinabove to the contrary, Impositions shall not include,
and Tenant shall never be obligated to pay, any corporate,
estate, inheritance, succession, capital, levy or transfer tax
of Landlord or any income, profit or revenue tax, franchise
taxes or other similarly imposed taxes of Landlord determined
on the basis of general income or revenues (except to the
extent a part of the sales, privilege, rent and other taxes
described by (ii) of this definition of Impositions) or any
interest or penalties in respect thereof.
n. Improvements: As defined in Section 2.
o. Insurance Requirements: all terms of an insurance policy
covering or applicable to the Leased Premises or any part
thereof, all requirements of the issuer of any such policy,
and all orders, rules, regulations and other requirements of
the National Board of Fire Underwriters (or any other body
exercising similar functions) applicable to or affecting all
or any part of the Leased Premises or any use or condition
thereof.
p. Lease: this Lease, as at the time amended, modified or
supplemented, together with all Exhibits now or hereafter
attached hereto or referenced herein.
q. Lease Term: as defined in Section 3.
r. Lease Year: Except with regard to the first Lease Year, which
first Lease Year shall include the first twelve (12) full
calendar months and any partial month at the commencement of
the Lease Term (if the Lease commences on a date other than
the first of a month), each consecutive twelve (12) month
period during the Lease Term, with the first Lease Year
commencing simultaneously with the commencement of the Lease
Term,
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and with each subsequent Lease Year commencing immediately
upon the expiration of the immediately preceding Lease Year.
s. Leased Premises: as defined in Section 2.
t. Legal Requirements: all laws, statutes, codes, acts,
ordinances, orders, judgments, decrees, injunctions, rules,
regulations, permits, licenses, authorizations, directions and
requirements of all governments, officials and officers,
foreseen or unforeseen, ordinary or extraordinary, which now
or at any time hereafter may be applicable to all or any part
of the Leased Premises or any use or condition thereof.
u. Month or Monthly: each calendar month beginning or ending
during the Lease Term.
v. Option or Options: as defined in Section 27.
w. Option Date: as defined in Section 27.
x. Qualified Appraiser: as defined in Section 28.
y. Real Property Taxes: all taxes, assessments, levies, and other
charges of any kind or nature whatsoever, general and special,
foreseen and unforeseen (including all installments of
principal and interest required to pay any existing or future
general or special assessments for public improvements,
services or benefits, and any increases resulting from
reassessments resulting from a change in ownership, new
construction, or any other cause), now or hereafter imposed by
any governmental or quasi-governmental authority or special
district having the direct or indirect power to tax or levy
assessments, which are levied or assessed against, or with
respect to the value, occupancy or use of all or any portion
of the Leased Premises (as now constructed or as may at any
time hereafter be constructed, altered or otherwise changed)
or Landlord's interest therein, the fixtures, equipment and
other property of Landlord, real or personal, that are an
integral part of and located on the Leased Premises, the gross
receipts, income, or rentals from the Leased Premises, or the
use of parking areas, public utilities, or energy within the
Leased Premises, or Landlord's business of leasing the Leased
Premises. If at any time during the Lease Term the method of
taxation or assessment of the Leased Premises prevailing as of
the Effective Date shall be altered so that in lieu of or in
addition to any Real Property Taxes described above there
shall be levied, assessed or imposed (whether by reason of a
change in the method of taxation or assessment, creation of a
new tax or charge, or any other cause) an alternate or
additional tax or charge (i) on the value, use or occupancy of
the Leased Premises or Landlord's interest therein, or (ii) on
or measured by the gross receipts, income or rentals from the
Leased Premises, on Landlord's business of leasing the Leased
Premises, or computed in any manner with respect to the
operation of the Leased Premises, then any such tax or charge,
however designated, shall be included within the meaning of
the term "REAL PROPERTY TAXES" for purposes of this Lease.
"Real Property Taxes" shall also include any costs and
expenses incurred by Landlord in connection with appealing
and/or contesting any Real Property Taxes.
z. Rent: shall mean, collectively, Base Rent, Additional Charges,
Impositions, late charges and all other payments of money
payable to Landlord under this Lease, whether or not such
payments are specifically denominated as rent hereunder.
aa. Restoration: as defined in Section 20(b).
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bb. SNDA: as defined in Section 26.
cc. Tenant's Equipment: all personal property, furniture,
furnishings, business or trade fixtures and equipment now or
hereafter in or about the Leased Premises or any part thereof,
which are the property of Tenant or any permitted sublessee or
assignee of Tenant, the Alteration or removal of which shall
be in accordance with Section 10. Without limiting the
generality of the foregoing, Tenant's Equipment shall include
that property listed on the attached Exhibit B.
dd. Third Appraiser: as defined in Section 28.
ee. Unavoidable Delays: delays due to strikes, acts of God, labor
disputes, fire, earthquakes, floods, explosion, out of the
ordinary actions of the elements, invasion, war, insurrection,
sabotage, inability to procure or general shortage of labor,
equipment, facilities, materials, or supplies in the open
market, failure of transportation, lockouts, actions of labor
unions, laws or orders of governmental, civil, military or
naval authorities, governmental restrictions, enemy action,
riot, civil commotion, unavoidable casualty, or other causes
(whether similar or dissimilar) beyond the control of the
obligated party hereto, financial inability excepted.
2. LEASED PREMISES. Landlord hereby leases to Tenant, and Tenant hereby
leases from Landlord, the Property together with all improvements,
buildings, fixtures and structures ("IMPROVEMENTS") as now or
hereafter existing, constructed or altered thereon and all
appurtenances thereto (collectively, the "LEASED PREMISES"). Tenant
acknowledges that Tenant is the prior owner of the Leased Premises,
that this Lease is part of a sale-leaseback transaction and Tenant
is intimately familiar with all aspects of the Leased Premises and
that this Lease is on an "as is", "where is" and "with all faults"
basis.
3. TERM. The term of this Lease ("LEASE TERM") shall commence on
_________________________, 2002, and shall end on the last day of
the one hundred eightieth (180th) full calendar month after
commencement of the Lease Term, which expiration date is
____________________, 2017, subject to the Options to extend
hereinafter set forth or earlier termination pursuant to the terms
of this Lease.
4. RENT. Tenant shall pay to Landlord as base monthly rent ("BASE
RENT") for the Leased Premises as follows:
Lease Year 1 $250,000.00 per month
Lease Year 2 $255,000.00 per month
Lease Year 3 $260,100.00 per month
Lease Year 4 $265,302.00 per month
Lease Year 5 $270,608.04 per month
Lease Year 6 $276,020.20 per month
Lease Year 7 $281,540.60 per month
Lease Year 8 $287,171.42 per month
Lease Year 9 $292,914.85 per month
Lease Year 10 $298,773.14 per month
Lease Year 11 $304,748.61 per month
Lease Year 12 $310,843.58 per month
Lease Year 13 $317,060.45 per month
Lease Year 14 $323,401.66 per month
Lease Year 15 $329,869.69 per month
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Base Rent shall be payable in advance of the first day of each Month
during the Lease Term; provided, however, if the Lease Term
commences on a day other than the first day of a Month, Tenant shall
pay to Landlord concurrently with the commencement of the Lease
Term, the Base Rent for such partial Month on a pro-rated basis
calculated using a thirty (30) day month. The Base Rent and all
other sums payable to Landlord hereunder shall be paid by good check
payable in currency of the United States of America as at the time
shall be legal tender for the payment of public and private debts,
at the Landlord's address specified for notices in Section 30, or at
such other place as Landlord may designate in writing from time to
time. Such payments shall be made without any abatement, deduction
or offset whatsoever, and without any prior demand therefor. In the
event that the Lease Term is terminated for any reason on a date
other than the last day of a calendar month, on the first day of the
last calendar month of the Lease Term Tenant shall pay to Landlord
as Base Rent for the period from said first day of said last
calendar month to and including the last day of the Lease Term that
proportion of the monthly Base Rent hereunder which the number of
days between said first day of said last calendar month and the last
day of the term hereof bears to thirty (30). If a check of Tenant's
is dishonored for insufficient funds, Landlord may require Tenant to
make future payments due hereunder via electronic transfer or
cashier's check.
5. ADDITIONAL CHARGES. Tenant also shall pay from time to time during
the Lease Term as additional charges ("ADDITIONAL CHARGES"):
a. all amounts and obligations other than Base Rent which Tenant
herein assumes or agrees to pay, including without limitation
all Impositions; and
b. interest at the Default Rate on such of the foregoing amounts
and obligations other than Base Rent as are payable to
Landlord which are not paid on or before the fifth (5th) day
after written notice by Landlord to Tenant that such amount is
due, with such interest to accrue from each date that such
amount was due until paid.
6. LATE CHARGES AND INTEREST. Tenant acknowledges that late payment by
Tenant to Landlord of Rent under this Lease will cause Landlord to
incur costs not contemplated by this Lease, the exact amount of
which is extremely difficult or impracticable to determine. Such
costs include, but are not limited to, processing and accounting
charges, late charges that may be imposed on Landlord by the terms
of any mortgage or deed of trust secured by the Leased Premises.
Therefore, if any installment of Base Rent or any payment of
Additional Charges, Impositions or other rent due from Tenant is not
received by Landlord in good funds by the applicable due date,
Tenant shall pay to Landlord an additional sum equal to five percent
(5%) of the amount overdue as a late charge. The parties acknowledge
that this late charge represents a fair and reasonable estimate of
the costs that Landlord will incur by reason of late payment by
Tenant. In no event shall this provision for a late charge be deemed
to grant to Tenant a grace period or extension of time within which
to pay any Rent or prevent Landlord from exercising any right or
remedy available to Landlord upon Tenant's failure to pay any Rent
due under this Lease in a timely fashion, including any right to
terminate this Lease as set forth elsewhere herein. If any Base Rent
remains delinquent for a period in excess of five (5) days then, in
addition to such late charge, Tenant shall pay to Landlord interest
on any Base Rent, Rent and/or Additional Charges that is not paid
when due at the Default Rate following the date such amount became
due until paid.
7. USE OF LEASED PREMISES. Tenant may use the Leased Premises for any
lawful purpose permitted by applicable zoning, building and other
Legal Requirements of municipal, state or
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federal authorities now in force, or which hereafter may be in force
with respect to the Leased Premises'. Tenant will not commit, omit
or permit any act, condition or event which is contrary to any Legal
Requirement or Insurance Requirement. Tenant shall not commit any
waste in or about the Leased Premises, and Tenant shall keep the
Leased Premises in a neat, clean, attractive and orderly condition,
free of any nuisances.
8. TRIPLE NET LEASE. This Lease shall be deemed an absolute triple net
lease and Tenant shall do all acts and make all payments connected
with or arising out of any use or occupation of the Leased Premises,
or any part thereof, whether now or hereafter existing, levied or
imposed, and whether foreseen or unforeseen. Landlord shall not be
obligated to perform any acts or be subject to any liabilities or to
make any payments except as otherwise specifically and expressly
provided in this Lease.
9. MAINTENANCE AND REPAIRS.
a. Tenant at its sole Cost and Expense will keep in good, clean,
first class and operable condition the Leased Premises and
every part thereof, including, but not limited to, all
plumbing, heating, roof, parking lot, ventilation, air
conditioning and electrical systems and equipment in, on or
serving the Leased Premises, windows, doors, floors, interior
walls, the roof, exterior walls, ceiling and basement which
are part of the Leased Premises, and will make or cause to be
made all necessary or appropriate repairs, replacements or
renewals thereof, whether interior or exterior, structural or
non- structural, ordinary or extraordinary, foreseen or
unforeseen, capital or ordinary.
b. In addition to the foregoing, Tenant shall be required to make
such repairs, maintenance and replacements at such reasonable
intervals as the parties may agree, which intervals are
initially designated on Exhibit D. Tenant will maintain a
software package that schedules all preventative maintenance
procedures with the settings consistent with those set forth
on Exhibit D. Such repairs, maintenance and replacements shall
be done in a good, workmanlike and first class manner. If
Landlord so requires, Tenant shall obtain Landlord's consent,
which shall not be unreasonably withheld, as to the selection
of contractors prior to commencement of such work. Subject to
Tenant's right to use internal personnel for repair,
replacement and maintenance obligations, Tenant shall contract
for regular maintenance and upkeep for landscaping, elevators,
janitorial and the HVAC system, and shall provide Landlord
with copies of such concurrently herewith and within five (5)
business days after Landlord's request. If Landlord and/or a
successor in interest to Tenant shall be bound by such
contracts, such contracts shall include a clause that makes
them terminable upon thirty (30) days written notice from
Landlord. Unless Tenant has contracted for repair, replacement
and maintenance obligations with a third- party, at all times
during the Lease Term, Tenant shall maintain internal
maintenance personnel adequate to maintain the Leased Premises
in good, clean, first class and operable condition. If Tenant
does not maintain such internal maintenance personnel, as
Landlord shall reasonably determine, Tenant shall enter into
such maintenance contracts on such terms and conditions as
Landlord shall reasonably require.
c. Tenant shall also cause the Leased Premises to be inspected by
a licensed contractor on an annual basis, or at such other
times as Landlord shall reasonably designate, and Tenant shall
perform, subject to Unavoidable Delays, within forty five (45)
days after the presentation of the contractor's findings, all
repairs, maintenance and replacements designated by said
contractor. If Landlord so requires, Tenant shall obtain
Landlord's consent, which shall not be unreasonably withheld,
as to the selection of said contractor.
Page 6 of 42
Tenant shall also cause the roof, parking lot, plumbing and
electrical systems to be inspected by a licensed roofing
contractor, paving company, plumbing company or electrical
company as applicable, on an annual basis, or at such other
times as Landlord shall designate and Tenant shall perform,
subject to Unavoidable Delays, within forty five (45) days
after the presentation of the contractor's findings, all
repairs, maintenance and replacements designated by said
contractor. Tenant shall provide Landlord with a copy of any
reports or findings pursuant to any inspection required
hereunder within five (5) business days after Tenant's receipt
thereof.
d. If Tenant does not timely perform all of its maintenance,
repair and replacement obligations as required by the terms of
this Lease, Landlord may, but shall have no obligation to,
perform such obligations at Tenant's sole Cost and Expense. In
such event, Tenant shall reimburse Landlord for all Costs and
Expenses associated therewith upon demand, with interest at
the Default Rate from date of payment by Landlord. Such sums
shall be considered Rent for all purposes hereunder.
e. Tenant shall be required to maintain the Leased Premises in a
first class condition through the Lease Term, at its sole Cost
and Expense. Notwithstanding anything contained herein to the
contrary, Tenant shall be solely responsible for all
maintenance, repairs and replacements affecting the Leased
Premises during the Lease Term and in no event shall Tenant be
deemed an agent of Landlord for the purpose of conducting such
maintenance, repairs, and replacements without the express
written acknowledgement of agency by Landlord.
10. TENANT'S EQUIPMENT. All of Tenant's Equipment shall remain the
property of Tenant, provided that:
a. Tenant shall have the right at any time during the Lease Term
while not in Default to remove from the Leased Premises all or
any part of Tenant's Equipment in or on the Leased Premises
without regard to the manner placed on or affixed to the
Leased Premises, provided that Tenant at its expense
immediately will repair or be obligated for all Costs and
Expenses in connection with all damage to the Leased Premises
caused by the removal of Tenant's Equipment therefrom.
b. Any of Tenant's Equipment not removed by Tenant at its expense
within thirty (30) days after the expiration or earlier
termination of this Lease or the Lease Term shall be
considered abandoned by Tenant and may be appropriated, sold,
destroyed, or otherwise disposed of by Landlord without any
further notice to Tenant, and without obligation to account
therefor. Tenant at its expense will immediately repair or be
obligated for all Costs and Expenses in connection with all
damage to the Leased Premises caused by any removal of
Tenant's Equipment therefrom. Landlord shall not be
responsible for any loss of or damage to Tenant's Equipment,
except to the extent caused by Landlord's gross negligence or
willful acts.
11. ALTERATIONS AND ADDITIONS. Tenant shall have the right at any time
during the Lease Term, at Tenant's sole Cost and Expense, while not
in Default to make changes, alterations, additions or improvements
(collectively, "ALTERATIONS", or singularly, an "ALTERATION") in or
to the Leased Premises, subject to the following:
a. Tenant shall not construct any Alterations or otherwise alter
the Leased Premises without Landlord's prior written approval,
which approval shall not be unreasonably withheld or
Page 7 of 42
delayed, except that provided Tenant complies with each and
every other term and condition applicable to Alterations, no
approval by Landlord shall be required provided:
i. The cost of the Alteration in question does not cost in
excess of Fifty Thousand Dollars ($50,000.00);
ii. The total cost of all Alterations for the Lease Year in
which Tenant commences construction of the Alteration in
question does not total more than One Hundred Thousand
Dollars ($100,000.00); provided, however, that the cost
of Alterations costing less than Fifty Thousand Dollars
($50,000.00) shall not apply to the total Alteration
amount of One Hundred Thousand Dollars ($100,000.00) for
the applicable Lease Year unless and until the total
cost of all Alterations for such Lease Year costing less
than Fifty Thousand Dollars ($50,000.00) each shall
total at least One Hundred Thousand Dollars
($100,000.00), and then, all of such Alterations shall
apply to the total Alteration amount for said Lease Year
and the Tenant shall be required to obtain Landlord's
consent for any and all subsequent Alterations during
said Lease Year;
iii. Such Alteration does not affect the structural integrity
of the Leased Premises or any base-building system; and
iv. Such Alteration does not adversely affect the future
leaseability of the Leased Premises to a subsequent
lessee.
Except for any Alterations permitted under this Section 11(a)
without Landlord's consent, Tenant shall not construct any
Alteration until Landlord has approved in writing the plans
and specifications therefor, and such Alteration shall be
constructed substantially in compliance with such approved
plans and specifications by a licensed contractor first
approved by Landlord (who shall not unreasonably withhold,
condition or delay its approval of any such contractor). All
Alterations constructed by Tenant shall be constructed by a
reputable licensed contractor in a good and workmanlike first
class manner and using new materials of good quality, in
accordance with all applicable laws and regulations.
b. Tenant shall not commence construction of any Alterations
until:
i. All required governmental approvals and permits have
been obtained;
ii. All requirements regarding insurance imposed by this
Lease have been satisfied;
iii. Tenant has given Landlord at least ten (10) days' prior
written notice of its intention to commence such
construction,
iv. For any Alteration requiring Landlord's consent
hereunder, Tenant has obtained contingent liability and
broad form builders' risk insurance in an amount equal
to the cost of the Alteration if there are any perils
relating to the proposed construction not covered by
insurance required to be carried pursuant to Section 19.
v. For any Alteration requiring Landlord's consent
hereunder, Tenant has deposited into an escrow account
an amount equal to not less than one hundred fifty
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percent (150%) of the amount of the estimated hard and
soft costs of the Alteration, securing Tenant's payment
and performance of its obligations related to the
applicable Alteration.
c. All Alterations shall remain the property of Tenant during the
Lease Term but shall not be altered or removed from the Leased
Premises except in further accordance with this Section 11;
provided, however, that any Alteration which involves Tenant's
Equipment may be altered and removed in accordance with
Section 10. At the expiration or sooner termination of the
Lease Term, all Alterations shall be surrendered to Landlord
as part of the realty and shall then become Landlord's
property, and Landlord shall have no obligation to reimburse
Tenant for all or any portion of the value or cost thereof;
provided, however, Landlord expressly reserves the right to
require Tenant to remove any Alterations prior to the
expiration or sooner termination of the Lease Term by
providing Tenant with written notice thereof within sixty (60)
days prior to the expiration of the Lease Term or within
thirty (30) days after the earlier termination of the Lease
Term, as applicable.
d. For any Alteration reasonably determined by Landlord to
adversely affect the future leaseability of the Leased
Premises, Tenant shall post a letter of credit, in form and
content and with a bank reasonably acceptable to Landlord (or
other security reasonably satisfactory to Landlord) in an
amount equal to one hundred fifty percent (150%) of the
estimated cost (as determined by a licensed contractor's bid
good for reasonable period of time) to remove such Alteration
and restore the Leased Premises to its state immediately prior
to the commencement of construction of said Alteration. In
addition to the foregoing, Tenant shall cause a licensed
contractor reasonably acceptable to Landlord (if Landlord so
desires to maintain acceptance of such contractor) to prepare
a bid for the removal of said Alteration and restoration of
the Leased Premises to its state immediately prior to the
commencement of construction of said Alteration on each fifth
anniversary of the completion of construction of said
Alteration and shall increase the amount of the letter of
credit or other security, as applicable, to the extent
necessary to provide Landlord with one hundred fifty percent
(150%) security for such removal and restoration. Such letter
of credit or security may be drawn upon only upon Tenant's
failure to act in accordance with Landlord's request under
Section 31. The foregoing notwithstanding, Tenant shall not be
required to comply with the requirements of this Section 11(d)
if it obtains a minimum credit rating of at least BBB-
(minimum investment grade rating).
e. Every six (6) months Tenant shall notify Landlord in writing
of the nature and cost of any and all Alterations performed by
Tenant hereunder, and, to the extent Landlord has not already
been provided with plans, specifications, approvals, permits,
the final cost and such other information as Landlord shall
reasonably determine related to said Alteration, Tenant shall
provide Landlord with such information concurrently therewith.
f. Tenant shall, at its sole Cost and Expense, make any
Alteration of any sort to the Leased Premises when and if
required by applicable current or future law, including, but
not limited to, the Americans With Disabilities Act of 1990
and all applicable fire and safety codes. Tenant shall not be
required to make such Alterations solely as a result of a
change in the law as to such requirements, but only at such
times as are required by the applicable law or code. Tenant
may take advantage of any phase in or "grandfathering"
provisions in such laws and codes. Any such Alterations shall
be made by Tenant in accordance with and subject to the
provisions of this Section 11.
Page 9 of 42
g. In performing Alterations, Tenant shall not be deemed the
agent of Landlord for any purpose without the express written
acknowledgement of such agency by Landlord.
h. The provisions and conditions of Sections 13 and 14 below
shall apply to any work performed by Tenant under this Section
11.
12. IMPOSITIONS. Subject to Section 15 relating to permitted contests,
Tenant during the Lease Term (i) will pay when due (or such earlier
date as may be required by the installment payment provisions below
in this Section 12) and prior to delinquency all Real Property Taxes
levied or assessed against the Leased Premises; and (ii) will pay
all other Impositions; both subsections (i) and (ii), before any
interest, penalty, fine or cost may be added for non-payment, and
will furnish to Landlord for inspection within thirty (30) days
after such payment, receipts of the appropriate taxing authority or
other proof satisfactory to Landlord evidencing payment of such
other Impositions. Tenant will protect, indemnify and hold Landlord
harmless from and against all liabilities, obligations, claims,
damages, penalties, causes of action and Costs and Expenses imposed
upon or incurred by or asserted against Landlord or the Leased
Premises by reason of Tenant's failure to pay all Impositions as
required herein. If Real Property Taxes or any other Impositions are
payable in installments, Tenant may, at its election, make payment
thereof in installments which are due and payable during the Lease
Term; provided, however, Tenant shall pay Real Property Taxes in
quarterly installments during each tax year; provided further,
however, that Tenant shall not be required to make such quarterly
payments of Real Property Taxes if it obtains a minimum credit
rating of at least BBB- (minimum investment grade rating). To the
extent Tenant is required to make quarterly payments of Real
Property Taxes pursuant to the preceding sentence, Tenant shall make
such payments directly to the relevant governmental authority if
permitted by such authority; provided, however, that if the relevant
taxing authority does not accept quarterly payments, Tenant shall
make such payments into an interest bearing escrow account, with the
escrow agent being directed to make such payments to the relevant
taxing authority when directed by either Tenant or Landlord. Any
Impositions relating to a fiscal period, part of which is within and
part of which is subsequent to the Lease Term, whether or not such
Impositions shall become due and payable or a lien upon the Leased
Premises or any part thereof, or be assessed, levied, confirmed or
imposed during the Lease Term, shall be adjusted and apportioned
between Tenant and Landlord so that Tenant shall pay only that
portion of such Impositions computed by multiplying the total amount
of such Impositions relating to the fiscal period by a fraction, the
numerator of which is the number of days constituting the remainder
of the Lease Term and the denominator of which is the number of days
constituting the entire fiscal period. The amount due from either
party to the other based upon the adjustment and apportionment of
such Impositions shall be paid at or promptly following expiration
or termination of the Lease Term.
13. COMPLIANCE WITH REQUIREMENTS. Subject to Section 15 relating to
permitted contests, Tenant during the Lease Term will:
a. comply with all Legal Requirements and Insurance Requirements;
and
b. procure, maintain and comply with all permits, licenses,
franchises and other authorizations required for the use of
the Leased Premises or any part thereof then being made by
Tenant, and for the proper erection, installation, operation
and maintenance of the Improvements and Tenant's Equipment or
any part thereof.
Page 10 of 42
14. LIENS. If the Leased Premises, or any part thereof shall at any time
become subject to any vendor's, mechanic's, laborer's or
materialmen's lien based upon Tenant's Work, any Alteration or the
furnishing of material, labor or professional services to Tenant or
the Leased Premises and contracted for by or on behalf of Tenant or
its contractors or subcontractors, Tenant shall cause the same, at
Tenant's expense, to be discharged or bonded over (pursuant to
applicable state law) within twenty (20) days after notice thereof,
and Tenant shall defend, indemnify, protect and hold Landlord
harmless from all liability, loss, Costs and Expenses arising from
such lien, Alteration, material, labor and/or professional services.
15. PERMITTED CONTESTS. Tenant at its expense, after prior written
notice to Landlord and while not in Default, may contest in its own
name or in the name of Landlord, or both, by appropriate action
taken in good faith and with due diligence, the amount or validity
or application, in whole or in part, of any Impositions or any Legal
Requirement, provided that:
a. in the case of any Impositions or Legal Requirement, Tenant
shall first make all contested payments, under protest if it
desires, unless Tenant's action in some manner suspends the
collection of such payments or unless Tenant is not required
to make such payments;
b. neither the Leased Premises nor any part thereof or interest
therein could realistically under the then existing
circumstances be deemed to be in danger of being sold,
forfeited or lost by reason of the contest;
c. in the case of any Impositions or Legal Requirement, Tenant
shall have furnished such security, if any, as may be required
by governmental authority and reasonably approved by Landlord;
d. in the case of any Legal Requirement, Landlord could not
realistically and under the then existing circumstances be in
danger of any criminal or civil liability for failure to
comply therewith; and
e. in the case of any Imposition or Legal Requirement which
remains unpaid at any time during such contest, Tenant shall
have furnished to Landlord such security as Landlord shall
reasonably require in an amount not less than one hundred
twenty five percent (125%) of the amount claimed to be owed by
a governmental authority.
16. NO CLAIMS AGAINST LANDLORD. Nothing contained in this Lease shall
constitute any consent (except where consent is expressly required
and given under this Lease) or request by Landlord, express or
implied, for the performance of any labor or services or the
furnishing of any materials or other property in respect of the
Leased Premises or any part thereof, or as giving Tenant any right,
power or authority to contract for or permit the performance of any
labor or services or the furnishing of any materials or other
property in such fashion as would permit the making of any claim
against Landlord, except as any such claim is expressly provided for
by statute despite the provisions of this Section. Any labor,
services or material furnished to the Leased Premises in connection
with the fulfillment of Tenant's obligations hereunder shall be the
sole responsibility of Tenant.
17. INDEMNIFICATION BY TENANT. Tenant will indemnify, defend, protect
and hold Landlord harmless from and against all liabilities,
obligations, claims, damages, penalties, causes of action, and
proceedings, and all Costs and Expenses incurred in connection
therewith, imposed upon or incurred by or asserted against Landlord
or the Leased Premises by reason of the occurrence or existence of
any matter or thing relating to this Lease or the
Page 11 of 42
Leased Premises during the Lease Term, unless resulting from the
negligence or willful acts of Landlord, including but not limited
to:
a. any accident, injury to or death of persons (including
workers) or loss of or damage to property occurring on or
about the Leased Premises or any part thereof;
b. any condition or use of the Leased Premises or any part
thereof;
c. any failure on the part of Tenant to perform or comply with
any of the terms of this Lease;
d. performance of any labor or services or the furnishing of any
materials or other property in respect of the Leased Premises
or any part thereof; and
e. all claims for loss or damage to the Leased Premises
uncompensated by Tenant's insurance.
18. UTILITIES. In addition to the Rent and other payments herein
provided, Tenant during the Lease Term shall pay prior to
delinquency for all water, gas, light, power, telephone, sewage,
refrigeration, air conditioning, heat and ventilating, janitorial,
and all other materials and utilities used in connection with or
supplied to the Leased Premises. To the extent not already
installed, Tenant at its Cost and Expense shall have separate meters
installed for power, gas, water and other utilities for which
separate meters are available, and Tenant solely shall be obligated
for all utility connect, disconnect and security deposit charges
applicable to the Leased Premises. Landlord shall not be liable for,
and Tenant shall not be entitled to any other relief, by reason of
the unavailability or limited availability of the foregoing
utilities and services.
19. INSURANCE.
a. Risks To Be Insured. Tenant at its Cost and Expense during the
Lease Term will maintain the following insurance for the
Leased Premises with reputable insurers authorized to do
business in Arizona and rated at least A-IV by A.M. Best
Company:
i. primary coverage insurance with respect to the
Improvements against loss or damage by fire and other
risks from time to time in so-called "all risk" form
with a sprinkler leakage endorsement insuring the
personal property, inventory, trade fixtures, and
Alterations within the Leased Premises and the Leased
Premises for the full replacement value thereof, as
determined from time to time by the insurer, and in any
event in an amount sufficient to prevent Landlord from
becoming a co-insurer of any such loss or damage;
ii. commercial general liability insurance, together with
host liquor liability insurance, and together with
excess liability insurance coverage, insuring against,
liability for personal injury, bodily injury, death and
damage to property occurring in or about, or resulting
from an occurrence in or about, the Leased Premises with
combined single limit coverage on a per occurrence basis
of not less than a minimum amount of Five Million
Dollars ($5,000,000.00) and an aggregate limit of not
less than a minimum amount of Five Million Dollars
($5,000,000.00), which insurance shall contain (1) a
"contractual liability" endorsement insuring Tenant's
performance of Tenant's obligation to indemnify Landlord
for losses
Page 12 of 42
related to personal injury, bodily injury, death and
damage to property, as contained in Section 17; and (2)
a cross liability endorsement;
iii. appropriate worker's compensation or other insurance
against liability arising from claims of workmen in
respect of and during the period of any work on or about
the Leased Premises; and
iv. pollution legal liability insurance, together with new
conditions coverage, insuring against, liability for
environmental contamination, releases, disposal or
pollution to property occurring in, on, under or about,
or resulting from an occurrence in or about, the Leased
Premises with combined single limit coverage on a per
occurrence basis of not less than a minimum amount of
Five Million Dollars ($5,000,000.00), as such amount may
be increased at the reasonable request of Landlord, with
a deductible not to exceed One Hundred Thousand Dollars
($100,000.00). Notwithstanding anything contained herein
to the contrary, such coverage shall be with either AIG
or Zurich or such other similarly rated insurance
companies.
v. Such other insurance that from time to time is
reasonably required by any lender of Landlord.
b. Policy Provisions.
i. All insurance maintained by Tenant pursuant to Section
19(a)(i) (Property Insurance), shall:
1. name Landlord, Tenant, and such other parties as
Landlord shall reasonably designate as insureds,
as their respective interests may appear, and, if
reasonably commercially available, shall include
an effective waiver by the issuer of all rights of
subrogation against any insured or such insured's
interest in the Leased Premises or any income
derived therefrom as provided in Section 19(d);
2. provide that all insurance proceeds, if any, from
losses shall be adjusted with Landlord and Tenant.
ii. All insurance maintained by Tenant pursuant to Section
19(a)(ii) (Liability Insurance), shall name Landlord and
such other parties as Landlord shall reasonably
designate as additional insureds and, if reasonably
commercially available, shall include an effective
waiver by the issuer of all rights of subrogation
against any additional insured or such additional
insured's interest in the Leased Premises or any income
derived therefrom as provided in Section 19(d).
iii. All insurance maintained by Tenant pursuant to Section
19(a), shall:
1. not have a "deductible" in excess of One Hundred
Thousand Dollars ($100,000.00), or such greater
amount as is approved by Landlord;
2. if reasonably commercially available, pay any
losses notwithstanding any act or failure to act
or negligence of Landlord or Tenant or any other
Page 13 of 42
person or entity relating to any act, omission or
other event causing such losses;
3. provide that no cancellation, lapse, reduction in
amount or material change in coverage thereof
shall be effective until at least thirty (30) days
(or ten (10) days in the case of non payment of
premium) after receipt by Landlord and Tenant of
written notice thereof;
4. be primary insurance which provides that the
insurer shall be liable for the full amount of the
loss up to and including the total amount of
liability set forth in the declarations without
the right of contribution from any other insurance
coverage of Landlord;
5. be in a form reasonably satisfactory to Landlord;
and
6. contain a "severability" clause.
c. Delivery of Evidence of Insurance.
i. After written request by Landlord and/or not less than
thirty (30) days prior to the expiration date of any
policy to be obtained by Tenant pursuant to this Section
19, Tenant will deliver to Landlord a certificate of
insurance as to the issuance and effectiveness of such
policy and the amount of coverage afforded thereby.
Landlord may, at any time, and from time to time,
inspect and/or copy any and all insurance policies
required to be procured by Tenant pursuant to this
Section 19. Notwithstanding the foregoing, with regard
to the insurance required of Tenant pursuant to Section
19(a)(iv) above, Tenant shall provide Landlord with a
copy of the entire policy within five (5) business days
after the issuance thereof.
ii. Tenant shall pay all premiums due for insurance required
to be carried by Tenant hereunder (excepting worker's
compensation insurance as specified in Section
19(a)(iii)), one year in advance.
d. Waiver of Subrogation Rights.
i. To the extent permitted by Landlord's insurer, if any,
Landlord hereby releases and waives any and all rights
of subrogation against Tenant, and against the officers,
employees, agents and representatives of Tenant, which,
in the absence of this Section 19(d)(i), would arise in
favor of any insurance company insuring Landlord against
loss by fire or casualty and loss of any other type
resulting from damage to or destruction of the
Improvements or any portion thereof, or in damage to or
destruction of the property of Landlord or the property
of others under Landlord's control on the Leased
Premises, and to the extent permitted by Landlord's
insurer, if any, Landlord hereby releases and waives its
right of recovery against Tenant for loss or damage
resulting from damage to or destruction of the
Improvements or any part thereof, or in damage to or
destruction of the property of Landlord on the Leased
Premises caused by fire, or other hazards insured
against by extended coverage or casualty insurance as
provided in this Lease, to the extent that Landlord is
compensated for such loss or damage by actual receipt of
proceeds from insurance policies covering such loss or
damage or portions thereof, it being expressly
understood and agreed that
Page 14 of 42
this release and waiver shall not constitute a release
and waiver by Landlord of any right of recovery against
Tenant for loss or damage, whether arising in connection
with the same claim or separate claims, in excess of
insurance proceeds actually received by Landlord.
ii. To the extent permitted by Tenant's insurer, if any,
Tenant hereby releases and waives any and all rights of
subrogation against Landlord, and against the officers,
employees, agents and representatives of Landlord,
which, in the absence of this Section 19(d), would arise
in favor of any insurance company insuring Tenant
against loss by fire or casualty and loss of any other
type resulting from damage to or destruction of the
Improvements or any portion thereof, or in damage to or
destruction of the Leased Premises of Tenant or the
property of others under Tenant's control on the Leased
Premises, and, to the extent permitted by Tenant's
insurer, if any, Tenant hereby releases and waives its
right of recovery against Landlord for loss or damage
resulting from damage to or destruction of the
Improvements or any part thereof, or in damage to or
destruction of the Leased Premises of Tenant on the
Leased Premises caused by fire, or other hazards insured
against by extended coverage or casualty insurance as
provided in this Lease, to the extent that Tenant is
compensated for such loss or damage by actual receipt of
proceeds from insurance policies covering such loss or
damage or portions thereof, it being expressly
understood and agreed that this release and waiver shall
not constitute a release and waiver by Tenant of any
right of recovery against Landlord for loss or damage,
whether arising in connection with the same claim or
separate claims, in excess of insurance proceeds
actually received by Tenant.
iii. The foregoing releases and waivers of subrogation rights
and releases and waivers of the rights of the Landlord
and of the Tenant respectively are expressly conditioned
upon the Landlord and the Tenant each being able to
obtain in present and future policies required under
this Lease of fire, extended coverage, casualty and
similar insurance, clauses or endorsements at a
commercially reasonable cost which permit the insured to
release and waive the insurance company's right of
subrogation against third parties responsible for loss,
and in the event either the Landlord or the Tenant at
any time is unable to obtain policies containing such
subrogation waiver clauses or endorsements at a
commercially reasonable cost, then and in that event
such party may give to the other party written notice
thereof and from and after the giving of such notice the
releases and waivers herein set forth and each and all
of them shall be considered withdrawn and shall in no
wise be effective as to loss or damage arising from
risks covered by such policies.
iv. Notwithstanding anything contained in Sections
19(d)(i)-(iii), the insurance required to be carried by
Tenant hereunder shall be primary in nature and any
insurance carried by Landlord, if any, shall be
secondary in nature. Further, Landlord shall have no
obligation whatsoever to carry insurance insuring the
Leased Premises, Improvements, Alterations or personal
property located within the Leased Premises.
Page 15 of 42
20. DAMAGE TO OR DESTRUCTION OF LEASED PREMISES.
a. Tenant To Give Notice. In case of any material damage to or
destruction of the Leased Premises or any part thereof, Tenant
will promptly (and in no event later than the tenth (10th) day
after such occurrence) give written notice thereof to Landlord
generally describing the nature, extent and cause of such
damage or destruction.
b. Restoration. In case of any damage to or destruction of the
Improvements or any part thereof at any time during the Lease
Term, subject to the terms of Section 20(e), Tenant shall, at
its Cost and Expense, promptly commence and complete, subject
to Unavoidable Delays, the restoration, replacement or
rebuilding of the Improvements as nearly as possible to its
value, condition and character immediately prior to such
damage or destruction (such restoration, replacement and
rebuilding, together with any temporary repairs and property
protection pending completion of the work, being herein called
"RESTORATION").
c. Application Of Insurance Proceeds. All insurance proceeds
received by Landlord or Tenant on account of any damage to or
destruction of the Improvements or any part thereof (less the
Costs and Expenses incurred by the Landlord and Tenant in the
collection thereof, including, without limitation, adjusters
fees and expenses) shall be paid only for the Restoration,
subject to Sections 20(d) and (e) below.
d. Abatement. During any period when Tenant's use of the Leased
Premises is prevented in whole or part by reason of total or
partial damage to or destruction of the Improvements, or by
reason of such restoration, the Rent shall be temporarily
abated in proportion to the degree that Tenant's use of the
Leased Premises is so prevented, but only to the extent of any
business interruption or loss of income insurance proceeds
actually received by Landlord from Tenant's insurance
described in Section 19.
e. Limited Termination. Except as set forth below, in case of any
damage or destruction occurring during the Lease Term, whether
or not insurance proceeds are available for the purpose of
Restoration, this Lease shall remain in full force and effect
without any abatement, suspension, deferment, diminution or
reduction. If twenty percent (20%) or more of the then
replacement value of the Improvements is damaged by fire or
other casualty occurring during the final two (2) Lease Years
of the then running initial or extended Lease Term and
Landlord receives insurance proceeds sufficient to cover any
Rent loss due to such termination, Tenant may terminate this
Lease by written notice to Landlord within thirty (30) days
after the date of the fire or other casualty, effective as of
the date set forth in such termination notice, which shall in
no event be earlier than the thirtieth (30th) day after the
date of said termination notice, with Tenant to be responsible
for the payment of all Rent and Additional Charges becoming
due hereunder until the date of such termination; provided,
that Tenant shall pay or assign its right to receive insurance
proceeds from such damage or destruction over to Landlord,
with Tenant to also pay Landlord contemporaneously with such
termination the insurance deductible amount, if any,
applicable to such damage or destruction.
21. EMINENT DOMAIN.
a. Whole or Substantial Taking. If all or substantially all of
the Leased Premises shall be lawfully taken by condemnation or
other eminent domain proceedings pursuant to any law, general
or special, this Lease shall terminate on the date of such
taking. All Rent
Page 16 of 42
and Additional Charges required to be paid by Tenant under
this Lease shall be paid up to the date of such termination
and upon such termination this Lease shall be of no further
force and effect, except that any obligation or liability of
either party, actual or contingent, under this Lease which has
accrued on or prior to such termination date shall survive and
any prepayment of Rent and Additional Charges shall be
prorated between the parties. For purposes of this Section
"substantially all of the Leased Premises" shall be deemed to
mean such portion of the Leased Premises as, when so taken,
would leave remaining a balance of the Leased Premises which,
due either to the area so taken or the location of the part so
taken in relation to the part not so taken, would not under
economic conditions, applicable zoning laws, building
regulations then existing or prevailing, reasonably
accommodate Tenant's business as conducted at the date of such
taking and after performance of all covenants, agreements,
terms and provisions herein and by law provided to be
performed and paid by Tenant. Tenant, in cooperation with
Landlord, shall have the right to participate in any
condemnation proceedings and be represented by legal counsel
for the purpose of protecting its interests hereunder.
b. Partial Taking. If only a portion of the Leased Premises shall
be so taken and Section 21(a) does not apply, this Lease shall
be unaffected by such taking, except that Rent payable by
Tenant pursuant to the provisions of this Lease shall be
equitably reduced by Landlord to a just and appropriate amount
according to the nature and extent of the taking.
c. Award. No award for any partial or total taking shall be
apportioned, it being agreed and understood that Landlord
shall be entitled to the entire award for any partial or
entire taking. Tenant assigns to Landlord its interest in any
award which may be made in such taking or condemnation,
together with any and all rights of Tenant arising in or to
the same or any part thereof. Nothing contained herein shall
be deemed to give Landlord any interest in or require Tenant
to assign to Landlord any separate award made to Tenant for
the taking of Tenant's Equipment, for the interruption of
Tenant's business or its moving costs, or for the loss of
goodwill. Nothing herein contained shall prohibit Tenant from
making a separate claim, to the extent permitted by law, for
the value of Tenant's Equipment, moving expenses or relocation
benefits.
d. Temporary Taking. If the temporary use or occupancy of all or
any part of the Leased Premises shall be lawfully taken for
not more than one hundred eighty (180) days by condemnation or
in any other manner for any public or quasi-public use or
purpose during the Lease Term, Tenant shall be entitled to
receive that portion of the award for such taking which
represents compensation for the taking of Tenant's Equipment,
moving expenses or relocation benefits, and that portion which
represents reimbursement for the cost of Restoration pursuant
to Section 21(e). This Lease shall be and remain unaffected by
such taking and Tenant shall be responsible for all
obligations hereunder not affected by such taking and shall
continue to pay in full when due the Rent, Additional Charges
and all other sums required to be paid by Tenant pursuant to
the provisions of this Lease. If the period of temporary use
or occupancy shall extend beyond the end of the Lease Term,
that part of the award which represents compensation for the
use or occupancy of the Leased Premises (or a part thereof)
shall be divided between Landlord and Tenant so that Tenant
shall receive so much thereof as represents the period to and
including the end of the Lease Term, and Landlord shall
receive so much as represents the period subsequent to the end
of the Lease Term.
Page 17 of 42
e. Restoration. In the event of any taking of the Leased Premises
which does not result in a termination of this Lease, or in
the event of a taking for a temporary use or occupancy of all
or any part of the Leased Premises, Tenant at its expense
shall proceed with reasonable diligence with the Restoration
of the remaining parts of the Leased Premises to substantially
the condition existing immediately prior to the date of taking
to the extent that the same may be feasible to constitute a
complete and tenantable Leased Premises. Landlord shall
reimburse Tenant for the reasonable costs of the Restoration
of the Leased Premises in an amount not to exceed the amount
of the condemnation award specifically allocated to the
restoration of the Leased Premises; provided, however, that
Landlord shall use commercially reasonable efforts to seek
recovery of the reasonable costs of such Restoration as part
of the condemnation award and a specific allocation of such
costs in the award. If the condemnation award does not
specifically allocate any portion thereof for the restoration
of the Leased Premises, the Landlord shall reimburse Tenant
for the reasonable costs of the Restoration of the Leased
Premises in an amount not to exceed the amount of the
condemnation award in excess of the portion of the award
allocable to the real property taken, as Landlord shall
reasonably determine.
22. PERFORMANCE ON BEHALF OF TENANT. If Tenant shall fail to make any
payment or perform any act required hereunder to be made or
performed by Tenant, and provided Landlord has given Tenant ten (10)
days written notice of its intent to do so and Tenant has failed
during said period to make such payment or perform the act required
to be performed by Tenant, subject to Unavoidable Delays, then
Landlord may, but shall be under no obligation to, make such payment
or perform such act with the same effect as if made or performed by
Tenant. Notwithstanding the immediately preceding sentence, Landlord
may proceed immediately in the event of an emergency without any
notice to Tenant other than bona fide attempts to contact by
telephone as soon as reasonably possible under the circumstances
either of Tenants' two (2) representatives (whom Tenant may change
from time to time by providing written notice thereof) whose names
and telephone numbers Tenant has furnished in writing to Landlord
prior to such emergency. Entry by Landlord upon the Leased Premises
for such purpose shall not waive or release Tenant from any
obligation or an Event of Default hereunder. Tenant shall reimburse
Landlord for all reasonable sums so paid by Landlord and all
reasonable Costs and Expenses incurred by Landlord in connection
with Landlord's payment or performance under this Section with
interest at the Default Rate from the date of such payment by
Landlord, and no such payment or performance by Landlord pursuant
hereto, shall be deemed to suspend or delay the payment of any
amount of money or charge at the time the same becomes due or
payable, nor limit any right of Landlord or relieve Tenant from any
Default hereunder.
23. ASSIGNMENTS AND SUBLEASES.
a. Tenant shall not do any of the following (collectively
referred to herein as a "TRANSFER"), whether voluntarily,
involuntarily or by operation of law, without the prior
written consent of Landlord, which consent shall not be
unreasonably withheld or delayed:
i. sublet all or any part of the Leased Premises or allow
it to be sublet, occupied or used by any person or
entity other than Tenant; or
ii. assign its interest in this Lease.
In no event shall Tenant mortgage or encumber the Lease (or
otherwise use the Lease as a security device) in any manner.
Tenant shall reimburse Landlord for all reasonable costs
Page 18 of 42
and attorneys' and consultants' fees incurred by Landlord in
connection with the evaluation, processing and/or
documentation of any requested Transfer whether or not
Landlord's consent is granted. Any Transfer so approved by
Landlord shall not be effective until Tenant has delivered to
Landlord an executed counterpart of the document evidencing
the Transfer which: (x) is in a form reasonably approved by
Landlord; (y) contains the same terms and conditions as stated
in Tenant's notice given to Landlord pursuant to Section
23(b); and (z) in the case of an assignment of the Lease,
contains the agreement of the proposed transferee to assume
all obligations of Tenant under this Lease arising after the
effective date of such Transfer and to remain jointly and
severally liable therefor with Tenant. Any Transfer without
Landlord's consent, where such consent is required, shall, at
Landlord's election in its sole and absolute discretion,
constitute a Default by Tenant and shall be voidable at
Landlord's option. Landlord's consent to any one Transfer
shall not constitute a waiver of the provisions of this
Section 23(a) as to any subsequent Transfer or a consent to
any subsequent Transfer. No Transfer, even with the consent of
Landlord, shall relieve Tenant of its personal and primary
obligation to pay the Rent and Additional Charges and to
perform all of the other obligations to be performed by Tenant
hereunder. The acceptance of Rent by Landlord from any person
shall not be deemed to be a waiver by Landlord of any
provision of this Lease nor to be a consent to any Transfer.
Subject to the following, any Transfer shall be upon then fair
market value. Tenant shall provide Landlord with a certified
appraisal performed by a Qualified Appraiser (as defined
hereinafter) justifying the proposed rent and terms of the
proposed Transfer ("TRANSFER APPRAISAL"). Tenant hereby agrees
that it shall not be unreasonable for the Landlord to withhold
its consent to a proposed Transfer if it is not on such terms
and conditions at least as beneficial to the Landlord as set
forth in the Transfer Appraisal; provided, however, that if
Tenant is unable to consummate a sublease or assignment after
two hundred seventy (270) days of marketing the property or
negotiating the sublease at fair market value as determined by
the Transfer Appraisal, Tenant enter into a Transfer upon such
terms as reasonably become available from potential subtenants
and/or assignees.
b. At least thirty (30) days before a proposed Transfer is to
become effective, Tenant shall give Landlord written notice of
the proposed terms of such Transfer and request Landlord's
approval, which notice shall include the following:
i. the name and legal composition of the proposed
transferee;
ii. a current financial statement of the transferee,
financial statements of the transferee covering the
preceding three (3) years if the same exist, and (if
available) an audited financial statement of the
transferee for a period ending not more than one year
prior to the proposed effective date of the Transfer,
all of which statements are prepared in accordance with
generally accepted accounting principles;
iii. the nature of the proposed transferee's business to be
carried out in the Leased Premises;
iv. all consideration to be given on account of the
Transfer;
v. the proposed use of the proposed transferee;
Page 19 of 42
vi. the nature of any proposed tenant improvements or
Alterations;
vii. a copy of the Transfer Appraisal; and
viii. a current financial statement of Tenant (except that
such financial statement shall not be required if Tenant
is current in all filings required by the Securities and
Exchange Commission).
c. If Landlord consents to a Transfer proposed by Tenant, Tenant
may enter into such Transfer, and if Tenant does so, the
following shall apply:
i. Tenant shall not be released of its liability for the
performance of all of its obligations under this Lease.
ii. If Tenant assigns its interest in this Lease, then
Tenant shall pay to Landlord two- thirds (2/3) of all
Transfer Consideration (as defined hereinafter) received
by Tenant over and above the assignee's agreement to
assume the obligations of Tenant under this Lease.
iii. If Tenant sublets any part of the Leased Premises, then
with respect to the space so subleased, Tenant shall pay
to Landlord two-thirds (2/3) of the positive difference,
if any, between all Transfer Consideration paid by the
subtenant to Tenant, less Base Rent allocable to the
space sublet. Landlord shall reasonably determine the
Base Rent fairly allocable to the portion so subleased.
Such amount shall be paid to Landlord on the same basis
and at the same time, whether periodic or in lump sum,
that such Transfer Consideration is paid to Tenant by
its subtenant.
iv. Tenant's obligations under this Section 23(c) shall
survive any Transfer, and Tenant's failure to perform
its obligations hereunder shall be an Event of Tenant's
Default. Landlord shall have the right at reasonable
intervals to inspect Tenant's books and records relating
to the payments due hereunder. Upon request therefor,
Tenant shall deliver to Landlord copies of all bills,
invoices or other documents upon which its calculations
are based. Landlord may condition its approval of any
Transfer upon obtaining a certification from both Tenant
and the proposed transferee of all Transfer
Consideration and other amounts that are to be paid to
Tenant in connection with such Transfer.
v. As used in this Section 23(c), the term "TRANSFER
CONSIDERATION" shall mean the positive difference, if
any of: (i) any consideration of any kind received, or
to be received, by Tenant as a result of the Transfer,
if such sums are related to Tenant's interest in this
Lease or in the Leased Premises; minus (ii) all Costs
and Expenses reasonably related to the Transfer,
including, without limitation, brokerage fees and
commissions, legal fees, and Costs and Expenses of
Alterations and tenant improvements related to the
Transfer. The Costs and Expenses set forth in Section
23(c)(v)(ii) shall not exceed two (2) months base rent
under the applicable sublease or assignment.
vi. Tenant shall conditionally assign and transfer to
Landlord its interests in the sublease and all rentals
and income arising therefrom. Unless and until Tenant
Defaults in performing any of its obligations under this
Lease, Tenant may
Page 20 of 42
receive, collect, and enjoy the rents accruing under the
sublease. The condition to the assignment shall be that
if Tenant Defaults in any performing any of its
obligations under this Lease, Landlord may, at its
option (which may be exercised in Landlord's sole and
absolute discretion) by notice to Tenant and the
sublessee, do either of the following:
1. in pursuit of Landlord's remedies hereunder,
terminate the sublease in conjunction with a
termination of this Lease; or
2. elect to receive and collect, directly from the
sublessee, all rent and any other sums owing and
to be owed under the sublease, as further set
forth in Section 23(c)(vii) below.
If the Landlord elects to receive and collect rent and
other sums owing under the sublease, such shall not
limit the Tenant's right to receive any Transfer
Consideration it is entitled to pursuant to Section
23(c)(ii) or (iii), as applicable; provided, however,
the Landlord may receive and collect such Transfer
Consideration on behalf of Tenant and apply such to
remedy any Default of Tenant and/or apply such to the
Security Deposit.
vii. Landlord will not, as a result of the sublease, or as a
result of the collection of rents or any other sums from
the sublessee under Section 23(c)(vi) above, be liable
to the sublessee for any failure of Tenant, as
sublessor, to perform any obligation of Tenant, as
sublessor, under the sublease. Amongst such other
provisions as the Landlord shall reasonably require, the
sublease document and/or the consent to sublease
document shall contain the following provisions:
1. Tenant shall irrevocably authorize and direct the
sublessee, on receipt of any written notices from
Landlord stating that a Default exists in the
performance of any of Tenant's obligations under
this Lease, to pay to Landlord the rents and any
other sums due and to become due under the
sublease.
2. Tenant shall agree that the sublessee has the
right to rely on any such statement from Landlord,
and that the sublessee will pay those rents and
other sums to Landlord without any obligation or
right to inquire as to whether a default exists
and despite any notice or claim from Tenant to the
contrary.
3. Tenant will not have any right or claim against
the sublessee for those rents or other sums paid
by the sublessee to Landlord. Landlord will credit
Tenant with any rent actually received by Landlord
under this assignment, but the acceptance of any
payment on account of rent from the sublessee as
the result of a default by Tenant will not:
a. be an attornment by Landlord to the
sublessee or by the sublessee to Landlord;
b. be a waiver by Landlord of any provision of
the Lease; or
Page 21 of 42
c. release the Tenant from any liability under
the terms, agreements or conditions of the
Lease.
No payment of rent by the sublessee directly to
Landlord, regardless of the circumstance or
reasons for that payment, will be deemed an
attornment to Landlord by the sublessee in the
absence of a specific written agreement signed by
Landlord to that effect.
4. In the event the Lease is terminated prior to the
expiration of the term of the sublease, Landlord
shall have the right, at Landlord's option (which
may be exercised in Landlord's sole and absolute
discretion), pursuant to notice to the sublessee,
to succeed to Tenant's interest as sublessor in
the sublease and cause the sublessee to attorn to
Landlord on the terms and conditions of the
sublease. Within ten (10) days of Landlord's
request, the sublessee shall execute and deliver
to Landlord an attornment agreement in such form
and with such content as Landlord may reasonably
require. If Landlord exercises its option,
Landlord will so assume the obligations of Tenant,
as sublessor, under the sublease from the time of
the exercise of the option, but Landlord will not
be:
a. liable for any rent paid by the sublessee to
Tenant more than one month in advance, or
for any security deposit paid by the
sublessee to Tenant (unless actually
received by Landlord);
b. liable for any act or omission of the Tenant
under the Lease or for any default of
Tenant, as sublessor, under the sublease
which occurred prior to Landlord's
assumption;
c. subject to any defenses or offsets that the
sublessee may have against Tenant, as
sublessor, which arose prior to Landlord's
assumption; or
d. bound by any changes or modifications made
to the sublease without the prior written
consent of Landlord.
If Landlord does not elect to assume Tenant's
interest as sublessor in the sublease, the
sublease shall terminate concurrently with the
termination of this Lease.
5. The sublease shall not be subject to amendment or
modification without the prior written consent of
Landlord, which consent shall not be unreasonably
withheld.
6. The sublessee shall not be permitted to terminate
the sublease without first providing written
notice to the Landlord and providing Landlord with
a reasonable period of time (of not less than
thirty (30) days) to cure Tenant's default, as
sublessor, under the Sublease. Such notice shall
specify the nature of the default giving rise to
the sublessee's right to terminate the Lease.
Under no circumstances shall the Landlord be
required to cure such default and may do so in its
sole and absolute discretion.
Page 22 of 42
d. The sale of all or substantially all of Tenant's assets (other
than bulk sales in the ordinary course of business), any
dissolution of Tenant, or, the transfer, assignment and/or
hypothecation of any stock in Tenant, in the aggregate in
excess of twenty-five percent (25%) during the Lease Term;
excepting therefrom transfers in the aggregate in excess of
twenty-five percent (25%) during the Lease Term, but not more
than fifty percent (50%) during the Lease Term, where no
change in the controlling interests of Tenant occurs as a
result thereof, shall be deemed an assignment within the
meaning and provisions of this Section 23.
e. Notwithstanding anything contained herein to the contrary,
Tenant may, without Landlord's consent or participation,
transfer this Lease or sublease all or a portion of the Leased
Premises to:
i. any corporation or other legal entity which directly or
indirectly controls or is controlled by or is under
common control with Tenant ("AFFILIATE");
ii. any corporation or other legal entity not less than
fifty percent (50%) of whose outstanding stock or
beneficial interest shall, at the time, be owned
directly or indirectly by Tenant ("SUBSIDIARY"); or
iii. a corporation or other legal entity in which or with
which Tenant is merged or consolidated, in accordance
with applicable statutory provisions for merger or
consolidation, if any, provided that by operation of law
or by effective provisions contained in the instruments
of merger or consolidation, the liabilities of the
entities participating in such merger or consolidation
are assumed by the corporation or other legal entity
surviving such merger or created by such consolidation
("SUCCESSOR").
For purposes of this Section 23(e), "CONTROL" shall mean the
possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such
corporation or other legal entity, whether through the
ownership of voting securities or by contract or otherwise. If
Tenant assigns its interest in this Lease or subleases all or
a portion the Leased Premises to an Affiliate, Subsidiary or
Successor, Tenant shall, within ten (10) days after the
effective date of such Transfer, provide Landlord with an
assignment and assumption agreement or sublease, as
applicable, in substance and form reasonably acceptable to
Landlord.
f. Notwithstanding anything contained in this Section 23 to the
contrary, in the event that Tenant requests Landlord's consent
to a Transfer, Landlord shall have the following rights:
i. The right to terminate this Lease; or
ii. In the case of a sublease of less than fifty percent
(50%) of the Leased Premises, terminate this Lease as to
that part of the Leased Premises requested to be sublet;
or
iii. In the case of a sublease of greater than fifty percent
(50%) of the Leased Premises, terminate this Lease in
full or as to that part of the Leased Premises requested
to be so sublet, as Landlord shall determine in its sole
and absolute discretion, either:
Page 23 of 42
1. On the condition that the proposed transferee
immediately enter into a direct lease of the
Leased Premises with Landlord (or, in the case of
a partial sublease, a lease for the portion
requested to be so sublet) on the same terms and
conditions contained in the requested sublease or
such other terms and conditions as Landlord may
reasonably designate; or
2. So that Landlord is thereafter free to lease the
Leased Premises (or, in the case of a partial
sublease, the portion requested to be so sublet)
to whomever (including, without limitation, the
proposed transferee) it pleases on whatever terms
are acceptable to Landlord in its sole and
absolute discretion.
iv. In the event Landlord elects to so terminate this Lease
as set forth above, then:
1. If such termination is conditioned upon the
execution of a lease between Landlord and the
proposed transferee, Tenant's obligations under
this Lease shall not be terminated until such
transferee executes a new lease with Landlord,
enters into possession and commences the payment
of rent; and
2. If Landlord elects simply to terminate this Lease
(or, in the case of a partial sublease, terminate
this Lease as to the portion requested to be so
sublet), the Lease shall so terminate in its
entirety (or as to the space requested to be so
sublet) fifteen (15) days after Landlord has
notified Tenant in writing of such election.
3. Upon such termination, Tenant shall be released
from any further obligation under this Lease if it
is terminated in its entirety (or shall be
released from any further obligation under the
Lease with respect to the space requested to be so
sublet in the case of requested partial sublease),
except that the foregoing release shall not apply
to, and Tenant shall not be released from:
a. Any obligations under this Lease accruing
prior to such termination;
b. Any obligations under Section 31 below
relating to the surrender of the Leased
Premises or such space requested to be so
sublet, as applicable; and
c. Any obligations which, by their terms, are
to survive the expiration or sooner
termination of this Lease.
4. In the case of a partial termination of the Lease,
Landlord shall equitably adjust, as Landlord shall
reasonably determine, the Base Rent and allocate
costs and expenses related to common area
maintenance and Impositions to the Tenant based
upon the value of the Leased Premises not so
terminated.
Page 24 of 42
5. Upon Landlord's request, Tenant shall execute a
separate termination agreement evidencing any
termination of this Lease and/or amendment to this
Lease evidencing the matters set forth herein.
24. EVENTS OF DEFAULT; TERMINATION.
a. Events of Default. Any one or more of the following specified
events shall be a "DEFAULT":
i. if Tenant shall fail to pay any Base Rent when the same
becomes due and payable, and if such failure continues
for more than five (5) days after written notice of
non-payment of Rent has been given by Landlord to
Tenant. If so stated in the notice of default, the
notice of default shall also constitute a demand for
possession under the forcible entry and detainer
statutes; or
ii. if Tenant shall fail to pay, when the same becomes due
and payable, any Additional Charges or other Rent and
such failure shall continue for more than five (5) days
after written notice of such non-payment has been given
by Landlord to Tenant; or
iii. if Tenant shall fail to perform or comply with any other
obligation of Tenant under this Lease, and such failure
shall continue for more than thirty (30) days after
notice thereof has been given by Landlord to Tenant, and
Tenant shall not, subject to Unavoidable Delays, within
such thirty (30) day period commence with due diligence
the curing of such default, or, having so commenced,
shall thereafter fail or neglect, for reasons other than
Unavoidable Delays, to diligently pursue or complete the
curing of such default, such extended period not to
exceed one hundred eighty (180) days after notice
thereof from Landlord; or
iv. if Tenant shall make a general assignment for the
benefit of creditors, or shall admit in writing its
inability to pay its debts as they become due or shall
file a petition in bankruptcy, or shall be adjudicated a
bankrupt or insolvent, or shall file a petition seeking
any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief
under any present or future statute, law or regulation
due to its bankrupt or insolvent financial status;
v. if, as a result of any proceeding against Tenant, a
decree or order of a court or agency or supervisory
authority having jurisdiction in the premises for the
appointment of a conservator or receiver or liquidator
in any insolvency, readjustment of debt, marshalling of
assets and liabilities or similar proceedings of or
relating to the Tenant or of or relating to all or
substantially all of its property, or for the winding-up
or liquidation of its affairs or for the supervision of
the business or affairs of Tenant, shall have been
entered, and such decree or order shall have remained in
force undischarged or unstayed for a period of more than
sixty (60) days;
vi. Tenant shall have sublet the Leased Premises or assigned
its interest in this Lease in violation of the
provisions contained in Section 23;
vii. Tenant shall have abandoned the Leased Premises or left
the Leased Premises substantially vacant;
Page 25 of 42
viii. Tenant shall have failed to deliver documents required
of it pursuant to Sections 25(a) or (b) within the time
periods specified therein;
ix. Tenant shall have defaulted beyond applicable cure
periods under any loan, security agreement, security
instrument, promissory note, or other obligation
whatsoever under which Tenant is required to perform in
any manner whatsoever; or
x. Chronic delinquency by Tenant in the payment of any
Rent. For purposes of this Lease, "CHRONIC DELINQUENCY"
shall mean failure by Tenant to pay within five (5) days
of the due date any Rent for any two (2) months
(consecutive or non- consecutive) during any Lease Year.
This section shall in no way limit, nor be construed as
a waiver of the rights and remedies of Landlord provided
hereunder or by law in the event of even one (1)
instance of delinquency in the payment of Rent by
Tenant. In the event of chronic delinquency, at
Landlord's option, Landlord shall have the right, in
addition to all other rights under this Lease and at
law, to require that Tenant pay all Rent on a quarterly
basis, in advance, and make all Rent payments via
electronic transfer of funds. '
b. Remedies.
i. In the event of any default and breach by Tenant of any
of its obligations under this Lease and notwithstanding
the vacation or abandonment of the Leased Premises by
Tenant, this Lease shall continue in effect so long as
Landlord does not expressly terminate Tenant's right to
possession in any of the manners specified in this
paragraph and Landlord may, at Landlord's option and
without limiting Landlord in the exercise of any other
rights or remedies which it may have by reason of such
default and breach, exercise all of its rights and
remedies hereunder, including, without limitation:
1. The right to declare the Lease Term ended and to
reenter the Leased Premises and take possession
thereof and remove all persons therefrom, and
Tenant shall have no further claim in or to the
Leased Premises or under this Lease; or
2. The right without declaring this Lease ended to
reenter the Leased Premises, take possession
thereof, remove all persons therefrom and occupy
or lease the whole or any part thereof for and on
account of Tenant and upon such terms and
conditions and for such rent as Landlord may deem
proper and to collect such rent or any other rent
that may hereafter become payable and apply the
same as provided in Section 24(b)(ii); or
3. The right, even though Landlord may have relet the
Leased Premises or brought an action to collect
Rent and other charges without terminating this
Lease, to thereafter elect to terminate this Lease
and all of the rights of Tenant in or to the
Leased Premises; or
4. The right, without terminating this Lease, to
bring an action or actions to collect Rent and
other charges hereunder which are from time to
time past due and unpaid or to enforce any other
provisions of this Lease
Page 26 of 42
imposing obligations on Tenant, it being
understood that the bringing of any such action or
actions shall not terminate this Lease unless
written notice of termination is given.
ii. Should Landlord relet the Leased Premises under the
provisions of Section 24(b)(i)(2), Landlord may execute
any lease either in its own name or in the name of
Tenant, but Tenant hereunder shall have no right or
authority whatever to collect any rent from the new
tenant. The proceeds of any such reletting shall first
be applied to the payment of the costs and expenses of
reletting the Leased Premises, including without
limitation, reasonable brokerage commissions and
alterations and repairs which Landlord, in its sole and
absolute discretion, deems necessary and advisable and
to the payment of reasonable attorneys' fees and costs
incurred by Landlord in connection with Tenant's
default, the retaking of the Leased Premises and such
reletting and, second, to the payment of any
indebtedness, other than Rent, due hereunder, including,
without limitation, storage charges owing from Tenant to
Landlord. When such costs and expenses of reletting have
been paid, and if there is no such indebtedness or such
indebtedness has been paid, Tenant shall be entitled to
a credit for the net amount of rental received from such
reletting each month during the unexpired balance of the
Lease Term, and Tenant shall pay Landlord monthly on the
first day of each month as specified herein such sums as
may be required to make up the rentals provided for in
this Lease. Nothing contained herein shall be construed
as obligating Landlord to relet the whole or any part of
the Leased Premises.
iii. Should Landlord elect to terminate this Lease under the
provisions of Section 24(b)(i)(1) or (3) above, Landlord
shall be entitled to recover immediately from Tenant (in
addition to any other amounts recoverable by Landlord as
provided by law), the following amounts:
1. The worth at the time of award of the unpaid rent
which had been earned at the time of termination;
2. The worth at the time of award of the amount by
which the unpaid rent which would have been earned
after termination until the time of award exceeds
the amount of such rental loss that Tenant proves
could have been reasonably avoided;
3. The worth at the time of award of the amount by
which the unpaid rent for the balance of the Term
after the time of award exceeds the amount of such
rental loss that Tenant proves could be reasonably
avoided; and
4. Any other amount necessary to compensate Landlord
for all the detriment proximately caused by
Tenant's failure to perform its obligations under
the Lease or which in the ordinary course of
things would be likely to result therefrom.
For purposes of computing "the worth at the time of the
award" of the amount specified in Section 24(b)(iii)(3)
above, such amount shall be discounted at the discount
rate of the Federal Reserve Bank of San Francisco at the
time of award. For purposes of computing "the worth at
the time of the award" under
Page 27 of 42
Section 24(b)(iii)(1) or (2) above, an interest rate of
ten percent (10%) per annum shall be utilized.
iv. If Landlord shall elect to reenter the Leased Premises
as provided above, Landlord shall not be liable for
damages by reason of any reentry. Tenant hereby waives
all claims and demands against Landlord for damages or
loss arising out of or in connection with any reentering
and taking possession of the Leased Premises and waives
all claims for damages or loss arising out of or in
connection with any destruction of or damage to the
Leased Premises, or for any loss of property belonging
to Tenant or to any other person, firm or corporation
which may be in or upon the Leased Premises at the time
of such reentry.
v. Landlord shall not be deemed to have terminated this
Lease, Tenant's right to possession of the Leased
Premises or the liability of Tenant to pay Rent
thereafter to accrue or its liability for damages under
any of the provisions hereof by any reentry hereunder or
by any action in unlawful detainer or otherwise to
obtain possession of the Leased Premises, unless
Landlord shall notify Tenant in writing that Landlord
has so elected to terminate this Lease. Tenant agrees
that the service by Landlord of any notice pursuant to
the unlawful detainer statutes or comparable statutes of
the state or locality in which the Leased Premises are
located and the surrender of possession pursuant to such
notice shall not (unless Landlord elects to the contrary
at the time of or at any time subsequent to the service
of such notice and such election shall be evidenced by a
written notice to Tenant) be deemed to be a termination
of this Lease or of Tenant's obligations hereunder. No
reentry or reletting under this paragraph shall be
deemed to constitute a surrender or termination of this
Lease, or of any of the rights, options, elections,
powers and remedies reserved by Landlord hereunder, or a
release of Tenant from any of its obligations hereunder,
unless Landlord shall specifically notify Tenant, in
writing, to that effect. No such reletting shall
preclude Landlord from thereafter at any time
terminating this Lease as herein provided.
vi. All fixtures, furnishings, goods, equipment, chattels or
other personal property of Tenant remaining on the
Leased Premises at the time that Landlord takes
possession thereof may at Landlord's election be stored
at Tenant's expense or sold or otherwise disposed of by
Landlord in any manner permitted by applicable law.
vii. In the event of the exercise by Landlord of any one or
more of its rights and remedies hereunder, Tenant hereby
expressly waives any and all rights of redemption, if
any, granted by or under any present or future laws.
c. Cumulative Remedies. Each right, option, power, election and
remedy of Landlord provided for in this Lease or now or
hereafter existing at law or in equity or by statute or
otherwise shall be, cumulative and concurrent and shall be in
addition to every other right, power or remedy provided for in
this Lease or now or hereafter existing at law or in equity or
by statute or otherwise, and the exercise or beginning of the
exercise by Landlord of any one or more of the rights, powers
or remedies provided for in this Lease or now or hereafter
existing at law or in equity or by statute or otherwise shall
not prejudice, preclude or impair the simultaneous or later
exercise by Landlord of any or all such other rights, options,
powers, elections or remedies Landlord may have upon a
Page 28 of 42
breach and default under this Lease and shall not be deemed to
be a waiver of Landlord's rights or remedies thereupon or to
be a release of Tenant from Tenant's obligations thereon
unless such waiver or release is expressed in writing and
signed by Landlord.
d. Recovery of Costs and Expenses. If any action, whether at law
or equity, is instituted by either party for default by the
other under this Lease, the prevailing party shall be awarded
all Costs and Expenses incident thereto.
e. Limitation of Landlord Liability. Any claim, demand or right
of any kind by Tenant which is based upon or arises in
connection with this Lease shall be barred unless Tenant
commences an action thereon within twelve (12) months after
the date that Tenant discovers or, in the exercise of
reasonable diligence, should have discovered, the act,
omission, event or default upon which the claim, demand or
right in question arises, has occurred. In consideration of
the benefits accruing hereunder, Tenant and all successors and
assigns covenant and agree that, in the event of any actual or
alleged breach or default hereunder by Landlord:
i. the sole and exclusive remedy and source of recovery for
any judgment or award shall be against Landlord's
interest in the Leased Premises;
ii. no limited partner, member, shareholder or other owner
of Landlord (excepting general partners) (collectively,
"LANDLORD OWNER") shall be sued or named as a party in
any suit or action (except as may be necessary to secure
jurisdiction of the partnership);
iii. no service of process shall be made against any Landlord
Owner (except as may be necessary to secure jurisdiction
of Landlord);
iv. no Landlord Owner shall be required to answer or
otherwise plead to any service of process;
v. no judgment will be taken against any Landlord Owner;
vi. any judgment taken against any Landlord Owner may be
vacated and set aside at any time without hearing;
vii. no writ of execution will ever be levied against the
assets of any Landlord Owner;
viii. in no event shall Landlord be liable to Tenant for
punitive, special, indirect or consequential damages;
and
ix. these covenants and agreements are enforceable both by
Landlord and also by any Landlord Owner.
Tenant agrees that each of the foregoing covenants and
agreements shall be applicable to any covenant or agreement
either expressly contained in this Lease or imposed by statute
or at common law.
Page 29 of 42
25. ESTOPPEL CERTIFICATES AND FINANCIAL STATEMENTS.
a. Estoppel Certificate by Tenant. Tenant, any sublessee or
assignee or all of any portion of Tenant's interest under this
Lease, will execute, acknowledge and deliver to Landlord,
within fifteen (15) days of Landlord's written request, a
certificate certifying:
i. this Lease is unmodified and in full force and effect
(or, if there have been modifications, that the Lease is
in full force and effect, as modified, and stating the
modifications);
ii. the dates, if any, to which Rent, Additional Charges and
other sums payable hereunder have been paid;
iii. no notice has been received by Tenant of any Default
which has not been cured, except as otherwise specified
in such certificate, or, if there is an uncured Default,
specifying the nature of such;
iv. Landlord is not in default hereunder and no event which,
with the passing of time, giving of notice, or both,
would constitute a default by Landlord hereunder; and
v. certifying such other information about the status of
the Lease and the Leased Premises as may be required by
Landlord.
A failure to deliver an estoppel certificate within fifteen
(15) days after delivery of a request therefor shall be a
conclusive admission that, as of the date of the request for
such statement: (w) this Lease is unmodified except as may be
represented by Landlord in said request and is in full force
and effect, (x) there are no uncured defaults in Landlord's
performance, (y) no rent has been paid more than thirty (30)
days in advance; and (z) the information regarding the status
of the Lease, as represented by Landlord in said request, is
true and correct. Any such certificate may be relied upon by
any permitted prospective transferee, deed of trust
beneficiary or mortgagee of Landlord's interest under this
Lease.
b. Tenant's Financial Statements. At any time during the Lease
Term, Tenant shall, upon ten (10) days' prior written notice
from Landlord, provide Tenant's most recent financial
statement and financial statements covering the twenty-four
(24) month period prior to the date of such most recent
financial statement to any lender of Landlord, any potential
lender of Landlord or potential buyer of the Leased Premises.
Such statements shall be prepared in accordance with generally
accepted accounting principles and shall be certified by
Tenant's chief financial officer as true and correct in all
material respects or, if such is the normal practice of
Tenant, shall be audited by an independent certified public
accountant. Notwithstanding the foregoing, Tenant shall not be
obligated to provide Landlord with financial information as
set forth in this Section 25(b) for so long as Tenant is
required to, and does, file such information with the
Securities and Exchange Commission.
c. Estoppel Certificate by Landlord. Landlord will execute,
acknowledge and deliver to Tenant, within fifteen (15) days of
Tenant's written request, a certificate certifying:
i. that this Lease is unmodified and in full force and
effect (or, if there have been modifications, that this
Lease is in full force and effect as modified, and
stating the modifications);
Page 30 of 42
ii. the dates, if any, to which Rent, Additional Charges and
other sums payable hereunder have been paid; and
iii. whether or not, to the knowledge of Landlord, there then
exists any Default under this Lease (and if so,
specifying the same).
A failure to deliver an estoppel certificate within fifteen
(15) days after delivery of a request therefor shall be a
conclusive admission that, as of the date of the request for
such statement: (w) this Lease is unmodified except as may be
represented by Landlord in said request and is in full force
and effect, (x) there are no uncured defaults in Tenant's
performance, (y) no rent has been paid more than thirty (30)
days in advance; and (z) the information regarding the status
of the Lease, as represented by Tenant in said request, is
true and correct. Any such certificate may be relied upon by
any permitted prospective assignee, sublessee or other
transferee of all or part of Tenant's interest under this
Lease.
26. SUBORDINATION AND ATTORNMENT. This Lease, at Landlord's option,
shall be subordinate to any mortgage or deed of trust which may be
placed against the Leased Premises and to any and all advances made
or to be made pursuant to any such mortgage or deed of trust, and to
all renewals, replacements and extensions of any such mortgage or
deed of trust; provided that each such subordination shall be on the
condition that the mortgagee or deed of trust beneficiary and
trustee shall execute and deliver to Tenant an agreement ("SNDA") to
the effect that, so long as a Default caused by Tenant is not
occurring hereunder, such mortgagee, beneficiary or trustee will
recognize this Lease and not disturb or otherwise interfere with
Tenant's leasehold and other rights under this Lease. The form and
substance of such document shall be in form and content as may
reasonably be required by Landlord's lender or potential lender, as
the case may be. Tenant shall execute and deliver the SNDA within
fifteen (15) days after written request by Landlord.
27. OPTIONS TO EXTEND. Subject to the provisions of Section 24(a)(ix)
above and provided that no Default shall have occurred and be
continuing at the time this Option is exercised, Landlord hereby
grants to Tenant three (3) successive options (collectively, the
"OPTIONS", and each an "OPTION") to extend the Lease Term of this
Lease for three (3) successive periods of five (5) consecutive Lease
Years each. Tenant may exercise each Option only by giving Landlord
written notice thereof not less than twelve (12) months, no more
than eighteen (18) months prior to the expiration of the then
running initial or extended Lease Term, as the case may be. The
covenants, terms and conditions between Landlord and Tenant during
each such extended term shall be the same as contained in this Lease
for the initial Lease Term, except that Tenant shall have no further
right to extend the Lease Term, and the Base Rent payable during
each such extended term for which Tenant exercises this Option shall
be adjusted for the first Lease Year of the applicable Option to
equal the greater of:
a. one hundred and two percent (102%) of the Base Rent due for
the preceding Lease Year; and
b. Fair Market Rental of the Leased Premises as of the beginning
of the extended term ("OPTION DATE") as hereinafter set forth:
i. Between the three hundred sixty-fifth (365th) and one
hundred eightieth (180th) day prior to the Option Date,
Landlord and Tenant shall attempt to agree by a written
and signed addendum to this Lease on the Fair Market
Rental to be payable during such extended term. If
Landlord and Tenant are unable to agree
Page 31 of 42
on such Fair Market Rental or fail to execute the
addendum by the one hundred eightieth (180th) day
preceding the Option Date, then, within thirty (30) days
thereafter Landlord and Tenant shall each select a
Qualified Appraiser and use the appraisal mechanism set
forth in Section 28 to determine the Fair Market Rental.
ii. If for any reason the Fair Market Rental has not been
determined as of the Option Date, Tenant shall continue
to pay Base Rent to Landlord in an amount of Landlord's
lowest proposal during the negotiations set forth in
Section 27(b)(i) above, and, when the Fair Market Rental
for the extended term is determined, Tenant within
thirty (30) days following Landlord's notice thereof,
shall pay to Landlord the amount of any increase for
each month during which Tenant paid a lower monthly
installment of Base Rent, or, if Tenant has over paid
Base Rent, Tenant shall receive a credit for such
amounts against Base Rent next coming due.
c. Further, the Base Rent for each Lease Year during an Option
after the first Lease Year during said Option shall be
increased by two percent (2%) over the preceding Lease Year.
d. The exercise of all preceding Option(s) is a condition
precedent to the exercise of any subsequent Option(s).
e. Any references in this Lease to the Lease Term shall mean the
initial Lease Term as extended pursuant to this Section.
28. APPRAISAL. Any appraisal of the Fair Market Rental of the Leased
Premises required or permitted hereunder shall be made by either
Landlord or Tenant selecting and notifying the other party hereto of
the name and address of an appraiser who is duly licensed in the
state where the Leased Premises are located, who is a member of the
American Institute of Real Estate Appraisers ("M.A.I.") and who is
knowledgeable concerning the sale and rental values of properties
similar to and located in the same State and County as the Leased
Premises (a "QUALIFIED APPRAISER"). Within fifteen (15) days after
being notified of the name and address of a Qualified Appraiser,
such other party hereto shall select and notify Landlord or Tenant
(as the case may be) of the name and address of a second Qualified
Appraiser. Within ten (10) days after the expiration of the
aforesaid fifteen (15) day period, the two Qualified Appraisers
shall select and notify Landlord and Tenant of the name and address
of a third Qualified Appraiser ("THIRD APPRAISER"). The first two
Qualified Appraisers selected by Landlord and Tenant each shall make
an independent and separate appraisal ("APPRAISAL") of the Fair
Market Rental of the Leased Premises, and shall furnish copies of
each such Appraisal to each other, to the Third Appraiser, and to
Landlord and Tenant within thirty (30) days after the expiration of
the aforesaid fifteen (15) day period. Within fifteen (15) days
after the expiration of the aforesaid thirty (30) day period, the
Third Appraiser will notify Landlord and Tenant of which Appraisal
the Third Appraiser has selected as the closer to the Fair Market
Rental of the Leased Premises. For the purposes hereof, the term
"FAIR MARKET RENTAL" means the rental during the applicable term
that a willing tenant would pay a willing landlord, neither of whom
is compelled to rent. In no event shall the Fair Market Rental
during the extended term under Section 27 be less than one hundred
two percent (102%) of the Base Rent payable by Tenant for the Lease
Year immediately prior to the Option Date for such extended term. If
either Landlord or Tenant fails to appoint its Qualified Appraiser
and send notice thereof to the other party as required herein, the
one appointed Qualified
Page 32 of 42
Appraiser promptly shall appoint a second Qualified Appraiser and
the Third Appraiser shall be selected as set forth hereinabove. If
Landlord and Tenant each shall appoint a Qualified Appraiser, but
such two Qualified Appraisers are unable to agree within the
required time upon the selection of a Third Appraiser, the Third
Appraiser shall be selected by the mutual agreement of the Landlord
and Tenant, if the Landlord and Tenant are unable to so agree within
ten (10) days, the Third Appraiser shall be selected by the then
presiding civil judge of the Superior Court of Arizona in and for
Maricopa County. The determination of the Fair Market Rental in
accordance with the foregoing procedures shall be final and binding
upon Landlord and Tenant and enforceable by any court of competent
jurisdiction. All appraisal fees and expenses of the Qualified
Appraiser selected by Landlord shall be paid by Landlord, of the
Qualified Appraiser selected by Tenant shall be paid by Tenant, and
of the Third Appraiser shall be paid equally by Landlord and Tenant.
Notwithstanding the foregoing, if the Fair Market Rental as
determined by the Third Appraiser pursuant to the foregoing
procedures is greater than the lowest proposal of Landlord during
the negotiation period, the Tenant shall pay one hundred percent
(100%) of the fees and expenses of both Qualified Appraisers and the
Third Appraiser. However, if the Fair Market Rental as determined by
the Third Appraiser pursuant to the foregoing procedures is lower
than the highest proposal of Tenant during the negotiation period,
the Landlord shall pay one hundred percent (100%) of the fees and
expenses of both Qualified Appraisers and the Third Appraiser. If
the Fair Market Rental as determined by the Third Appraiser pursuant
to the foregoing procedures is between Landlord's lowest proposal
during the negotiation period and Tenant's highest proposal during
the negotiation period, each of the parties shall bear the fees and
expenses of their respectively appointed Qualified Appraiser and
shall split the fees and expenses of the Third Appraiser.
29. RIGHT OF ENTRY. Provided that Landlord has given Tenant at least
twenty-four (24) hours prior notice (except in the event of an
emergency in which case no advance notice is required), and subject
to reasonable security precautions of Tenant, Landlord may, at all
reasonable times and during usual business hours, enter upon the
Leased Premises for the purpose of inspecting, repairing or
preserving the same, or to show the Leased Premises to prospective
purchasers, and in addition may, at any time within the last
eighteen (18) months of the then running Lease Term show the Leased
Premises to prospective tenants. Any entry into the Leased Premises
obtained by Landlord in accordance with this Section 29 shall not be
deemed to be a forcible or unlawful entry into, or a detainer of,
the Leased Premises, or an eviction, actual or constructive, of
Tenant from the Leased Premises. Tenant hereby waives any claims for
damages for any injury or inconvenience to or interference with
Tenant's business, any loss of occupancy or quiet enjoyment of the
Leased Premises, and any other loss occasioned thereby.
30. NOTICES. All notices and other communications to be given hereunder
by Landlord or Tenant shall be in writing and shall be deemed to
have been given upon (i) personal delivery when personally
delivered; (ii) upon the earlier of receipt or the third Business
Day following the date of deposit in the mail (at the addresses
specified below, whether or not received by the person to whose
attention notice is directed at such address) after having been
mailed by first class registered or certified mail, return receipt
requested, postage prepaid; (iii) the next business day when sent
via nationally recognized overnight courier; or (iv) upon receipt of
confirmation of successful transmission when sent by facsimile
transmittal (with a copy sent via First Class mail) as follows:
Page 33 of 42
Landlord: Tenant:
Phoenix Industrial Investment
Partners, L.P. SpeedFam - IPEC, Inc.
19800 Glen Una Drive 305 North 54th St.
Saratoga, California 95070 Chandler, AZ 85226
Attn: Kenneth Levy Attn: J. Michael Dodson
Facsimile: 408-875-4714 Facsimile: (480) 785-4116
With a copy to: With a copy to:
Frank H. Maiorana, Esquire Robert C. Bates, Esq.
Silicon Valley Law Group Snell & Wilmer, L.L.P.
152 North Third Street, Suite 900 One Arizona Center
San Jose, California 95112 Phoenix, Arizona 85004-0001
Facsimile: (408) 286-1430 Facsimile: (602) 382-6070
The parties hereto may change the address for delivery by providing
ten (10) days written notice to the other parties in the manner set
forth herein. The copies of notices sent to Frank H. Maiorana and
Robert C. Bates are informational and are not required in order for
the notices given to Landlord and Tenant to be effective.
31. SURRENDER. Upon the expiration of the Lease Term, or upon the
earlier termination of this Lease, Tenant shall vacate and surrender
the Leased Premises to Landlord in first class condition and repair
and in full compliance with the maintenance, repair and replacement
provisions of this Lease. In any event, Tenant shall cause the
following to be done prior to the expiration or the sooner
termination of this Lease:
a. all interior walls shall be painted or cleaned so that they
appear freshly painted;
b. all non-carpeted floor coverings shall be cleaned and waxed to
the extent they are in first class condition;
c. to the extent non-carpeted floor coverings are not in first
class condition, said floor coverings shall be repaired or
replaced, as necessary;
d. all carpets not in first class condition shall be cleaned and
shampooed to the extent necessary to place them in first class
condition as reasonably determined by Landlord;
e. to the extent cleaning and shampooing does not place the
carpets in first class condition as reasonably determined by
Landlord, such carpets shall be replaced, to the extent
necessary, with neutral carpets of equal or better quality;
f. all broken, marred, stained or nonconforming acoustical
ceiling tiles shall be replaced; and
g. all windows shall be washed.
If Landlord so requests, Tenant shall, prior to the expiration or
sooner termination of this Lease, remove any Alterations which
Tenant is required to remove pursuant to Section 11 and repair all
damage caused by such removal.
Page 34 of 42
If the Leased Premises are not so surrendered upon the expiration or
sooner termination of this Lease, Tenant shall be liable to Landlord
for all costs incurred by Landlord in conforming the Leased Premises
to the required condition, plus interest on all such costs at the
Default Rate. Tenant shall indemnify Landlord against loss or
liability to the extent resulting from delay by Tenant in so
surrendering the Leased Premises, including, without limitation, any
claims made by any succeeding tenant to the extent related to such
delay.
32. NO BROKER. Landlord and Tenant each represents to the other that
there are no broker's commissions in connection with this Lease and
each party shall indemnify, defend, protect and hold the other
harmless from and against any and all Costs and Expenses related to
a claim of commission owing by and through the applicable party.
33. WAIVER. Any waiver by Landlord of any Default, breach or failure by
Tenant shall not constitute a waiver of any other Default, breach or
failure by Tenant hereunder. The subsequent acceptance of Base Rent,
Rent or Additional Charges hereunder by Landlord shall not be deemed
to be a waiver of any preceding Default or breach by Tenant of this
Lease, other than a failure of Tenant to pay the particular Base
Rent, Rent or Additional Charges so accepted. No covenant, term or
condition of this Lease shall be deemed to have been waived by
Landlord unless such waiver be in writing by Landlord.
34. NO PARTNERSHIP. The relationship of the parties hereto as solely
that of landlord and tenant, and under no circumstances shall the
parties hereto be considered as partners, joint venturers or lender
and borrower. Tenant represents, warrants and acknowledges that the
transaction by which the Landlord acquired title to the Leased
Premises and the subsequent lease of the Leased Premises hereunder
are separate and distinct transactions and the Tenant has no rights
of first refusal or options to purchase the Leased Premises.
35. PARTIAL INVALIDITY. The invalidity or unenforceability of any
covenant, term or condition of this Lease shall not affect any other
covenant, term or condition of this Lease.
36. RECORDING. Neither Landlord nor Tenant shall record this Lease
without the prior written consent of the other, which consent may be
withheld in the other party's sole and absolute discretion. Either
party, however, may record a memorandum hereof and, in the event of
a request to execute such memorandum by one party, the other party
shall execute and deliver to the requesting party within ten (10)
days after the request therefor, such memorandum to be in a form
reasonably acceptable to both parties. If either party requests a
memorandum of this Lease be executed and recorded, concurrently with
the execution and delivery of said memorandum, Tenant shall execute
and deliver to Landlord a Quitclaim Deed in such form and content as
Landlord shall require. Such Quitclaim Deed shall be held by
Landlord unrecorded unless and until this Lease has expired or been
terminated. Tenant hereby irrevocably authorizes and directs
Landlord to record said Quitclaim Deed upon the expiration or
earlier termination of this Lease; provided, however, Landlord shall
provide Tenant with notice of Landlord's intent to record the
Quitclaim Deed at least five (5) business days prior to such
recording.
37. HAZARDOUS MATERIALS. Landlord and Tenant agree as follows with
respect to the existence or use of Hazardous Materials in, on or
about the Leased Premises:
a. Except as otherwise permitted pursuant to Section 37(c) below,
any handling, transportation, storage, treatment, disposal or
use of Hazardous Materials by Tenant and Tenant's agents,
employees, contractors, or invitees (collectively "AGENTS")
after the
Page 35 of 42
Effective Date in or about the Leased Premises is strictly
prohibited. Tenant shall indemnify, defend upon demand with
counsel reasonably acceptable to Landlord and hold harmless
Landlord from and against any liabilities, losses, claims,
damages, lost profits, consequential damages, interest,
penalties, fines, monetary sanctions, attorneys' fees,
experts' fees, court costs, remediation costs, investigation
costs, and other expenses which result from or arise in any
manner whatsoever out of the use, storage, treatment,
transportation, release, or disposal of any Hazardous
Materials on or about the Leased Premises caused or permitted
by Tenant or Tenant's Agents.
b. If the presence of Hazardous Materials in, on or about the
Leased Premises caused or permitted by Tenant or Tenant's
Agents results in contamination or deterioration of water or
soil resulting in a level of contamination greater than the
levels established as acceptable by any governmental agency
having jurisdiction over such contamination, then Tenant shall
promptly take any and all action necessary to investigate and
remediate such contamination if required by Law or as a
condition to the issuance or continuing effectiveness of any
governmental approval which relates to the use of the Leased
Premises or any part thereof.
c. Landlord acknowledges that Tenant uses numerous chemicals
classified as Hazardous Materials in the operation of its
business and that Tenant shall be permitted to do so provided
that Tenant does so in a manner consistent with the
requirements of this Section 37(c) and provided that Tenant
discloses the use of such materials to Landlord as required by
Section 37(k). In addition, Tenant may use reasonable
quantities of household chemicals such as adhesives,
lubricants and cleaning fluids in order to conduct its
business at the Leased Premises. Tenant agrees that during its
use and occupancy of the Leased Premises it will: (1) not (A)
permit Hazardous Materials to be present on or about the
Leased Premises except in a manner and quantity necessary for
the ordinary performance of Tenant's business or (B) release,
discharge or dispose of any Hazardous Materials on, in, at,
under, or emanating from, the Leased Premises; (2) comply with
all Hazardous Materials Laws relating to the Leased Premises
and the use of Hazardous Materials on or about the Leased
Premises and not engage in or permit others to engage in any
activity at the Leased Premises in violation of any Hazardous
Materials Laws; and (3) immediately notify Landlord of (A) any
inquiry, test, investigation or enforcement proceeding by any
governmental agency or authority against Tenant, Landlord or
the Leased Premises relating to any Hazardous Materials or
under any Hazardous Materials Laws; (B) any contamination of
the Leased Premises by Hazardous Materials which constitutes a
violation of any Hazardous Materials Laws; or (C) the
occurrence of any event or existence of any condition that
would cause a breach of any of the covenants set forth in this
Section 37.
d. Upon reasonable notice to Tenant, Landlord may inspect the
Leased Premises and surrounding areas for the purpose of
determining whether there exists on or about the Leased
Premises any Hazardous Material or other condition or activity
that is in violation of the requirements of this Lease or of
any Hazardous Materials Laws. Such inspections may include,
but are not limited to, entering the Leased Premises or
adjacent property with drill rigs or other machinery for the
purpose of obtaining laboratory samples. Landlord shall not be
limited in the number of such inspections during the Lease
Term. In the event (i) such inspections reveal the presence of
any such Hazardous Material or other condition or activity in
violation of the requirements of this Lease or of any
Hazardous Materials Laws, or (ii) Tenant or its Agents
contribute or knowingly consent to the presence of any
Hazardous Materials in, on, under, through or about the Leased
Page 36 of 42
Premises or exacerbate the condition of or the conditions
caused by any Hazardous Materials in, on, under, through or
about the Leased Premises, Tenant shall reimburse Landlord for
the cost of such inspections within ten (10) days of receipt
of a written statement therefor. Tenant will supply to
Landlord such historical and operational information regarding
the Leased Premises and surrounding areas as may be reasonably
requested to facilitate any such inspection and will make
available for meetings appropriate personnel having knowledge
of such matters. Tenant agrees to give Landlord at least sixty
(60) days prior notice of its intention to vacate the Leased
Premises so that Landlord will have an opportunity to perform
such an inspection prior to such vacation. The right granted
to Landlord herein to perform inspections shall not create a
duty on Landlord's part to inspect the Leased Premises, or
liability on the part of Landlord for Tenant's use, storage,
manufacture, treatment or disposal of Hazardous Materials, it
being understood that Tenant shall be solely responsible for
all liability in connection with the use, storage,
manufacture, treatment or disposal of Hazardous Materials by
Tenant or Tenant's Agents.
e. As used herein, the term "HAZARDOUS MATERIALS" means any
hazardous or toxic substance, material or waste which is or
becomes regulated by any local governmental authority, the
State of Arizona or the United States government. The term
"HAZARDOUS MATERIALS" includes, without limitation, petroleum
products, asbestos, PCB's, and any material or substance which
is (i) listed under, or defined as hazardous or extremely
hazardous pursuant to The Arizona Environmental Quality Act of
1986, A.R.S. Section 49-101, et. seq., (ii) deemed as a
"hazardous waste" pursuant to Section 1004 of the Federal
Resource Conservation and Recovery Act, 42 U.S.C. 6901 et seq.
(42 U.S.C. 6903) ("RCRA"), (iii) defined as a "hazardous
substance" pursuant to Section 101 of the Comprehensive
Environmental Response, Compensation and Liability Act, 42
U.S.C. 9601 et seq. (42 U.S.C. 9601) ("CERCLA") or any
regulations promulgated under CERCLA; (iv) any substance now
or hereafter regulated by the Toxic Substances Control Act, as
amended ("TSCA") (15 U.S.C. Section 2601 et seq.) or any
regulations promulgated under TSCA; (v) petroleum, petroleum
by-products, gasoline, diesel fuel, or other petroleum
hydrocarbons; (vi) asbestos and asbestos-containing material,
in any form, whether friable or non-friable; (vii)
polychlorinated biphenyls; (viii) lead and lead- containing
materials; or (ix) any additional substance, material or
waste. As used herein, the term "HAZARDOUS MATERIAL LAW(S)"
shall mean any statute, law, ordinance, or regulation of any
governmental body or agency (including the U.S. Environmental
Protection Agency, the Arizona Department of Environmental
Quality which regulates the use, storage, release or disposal
of any Hazardous Materials.
f. If Tenant's use of Hazardous Materials on or about the Leased
Premises results in a release, discharge or disposal of
Hazardous Materials on, in, at, under, or emanating from, the
Leased Premises, Tenant agrees to investigate, clean up,
remove or remediate such Hazardous Materials in full
compliance with: (i) the requirements of (A) all Hazardous
Materials Laws and (B) any governmental agency or authority
responsible for the enforcement of any Hazardous Materials
Laws; and (ii) any additional requirements of Landlord that
are reasonably necessary to protect the value of the Leased
Premises.
g. Landlord shall have the right, but not the obligation, prior
or subsequent to Tenant's Default, without in any way limiting
Landlord's other rights and remedies under this Lease, to
enter upon the Leased Premises, or to take such other actions
as it deems reasonably necessary or advisable, to investigate,
clean up, remove or remediate any Hazardous Materials or
contamination by Hazardous Materials present on, in, at,
under,
Page 37 of 42
or emanating from, the Leased Premises in violation of
Tenant's obligations under this Lease or under any Hazardous
Materials Laws. Notwithstanding any other provision of this
Lease, Landlord shall also have the right, at its election, in
its own name or as Tenant's agent, to negotiate, defend,
approve and appeal, at Tenant's expense, any action taken or
order issued by any governmental agency or authority with
regard to any such Hazardous Materials or contamination by
Hazardous Materials. The reasonable Costs and Expenses paid or
incurred by Landlord in the exercise of the rights set forth
in this Section 37 shall be payable by Tenant upon demand.
h. Notwithstanding any provision contained herein to the
contrary, Tenant shall surrender the Leased Premises to
Landlord upon the expiration or earlier termination of this
Lease free of debris, waste or Hazardous Materials placed on,
about or near the Leased Premises by Tenant or Tenant's
Agents, and, with respect to any contamination or other
conditions resulting from the actions or inaction of Tenant or
Tenant's Agents, in a condition which complies with all
Hazardous Materials Laws and any additional requirements of
Landlord that are reasonably necessary to protect the value of
the Leased Premises, including, without limitation, the
obtaining of any closure permits or other governmental permits
or approvals related to Tenant's use of Hazardous Materials in
or about the Leased Premises. If it is determined by Landlord
that the condition of all or any portion of the Leased
Premises is not in compliance with the provisions of this
Lease with respect to Hazardous Materials, including, without
limitation, all Hazardous Materials Laws, at the expiration or
earlier termination of this Lease, then at Landlord's sole
option, Landlord may require Tenant to hold over possession of
the Leased Premises until Tenant can surrender the Leased
Premises to Landlord in the condition in which the Leased
Premises existed on the Effective Date and in any case prior
to the appearance of such Hazardous Materials, including,
without limitation, the conduct or performance of any closures
as required by any Hazardous Materials Laws. Any such holdover
by Tenant will be with Landlord's consent, will not be
terminable by Tenant in any event or circumstance and will
otherwise be subject to the provisions of Section 38 of this
Lease.
i. Tenant agrees to indemnify and hold harmless Landlord from and
against any and all claims, losses (including, without
limitation, loss in value of the Leased Premises), liabilities
and expenses (including attorneys' fees) sustained by Landlord
attributable to (i) any Hazardous Materials placed on or about
the Leased Premises by Tenant or Tenant's Agents, or (ii)
Tenant's breach of any provision of this Section 37.
j. The obligations of Tenant under this Section 37 shall survive
the expiration or earlier termination of the Lease Term. The
rights and obligations of Landlord and Tenant with respect to
issues relating to Hazardous Materials are exclusively
established by this Section 37. In the event of any
inconsistency between any other part of this Lease and this
Section 37, the terms of this Section 37 shall control.
k. Prior to the execution of this Lease, Tenant has completed,
executed and delivered to Landlord a Hazardous Materials
Disclosure Certificate ("CERTIFICATE") in form and content
attached hereto as Exhibit C. Tenant covenants, represents and
warrants to Landlord that the information in the Certificate
is true and correct and accurately describes the Hazardous
Materials that will be manufactured, treated, used or stored
on or about the Leased Premises by Tenant or Tenant's Agents.
Tenant shall (a) on each six (6) month anniversary of the
commencement date of this Lease; and (b) at such other times
as Landlord reasonably requests, complete, execute and deliver
to Landlord an updated Hazardous Materials Disclosure
Certificate (each, an "UPDATED CERTIFICATE") describing
Page 38 of 42
Tenant's then current and known proposed future uses of
Hazardous Materials on or about the Leased Premises, which
Updated Certificates shall be in the same format as that which
is set forth in Exhibit C or in such updated format as
Landlord may reasonably require from time to time. Landlord
shall have the right to approve or disapprove such new or
additional Hazardous Materials in its sole and absolute
discretion; provided, however, that this requirement shall not
apply to Hazardous Materials manufactured, treated, used or
stored by Tenant in connection with Tenant's business, which
Hazardous Materials may be used in accordance with this
Section 37. Tenant shall make no use of Hazardous Materials on
or about the Leased Premises except as described in the
Certificate, an Updated Certificate or as otherwise approved
by Landlord in writing in accordance with this Section 37;
provided, however, that Landlord shall have no right to
approve or disapprove of Hazardous Materials manufactured,
treated, used or stored by Tenant in connection with Tenant's
business, which Hazardous Materials may be used in accordance
with this Section 37; provided further, however, that Tenant
shall not be required to provide Landlord prior notice of a
new or different chemical which is classified as a Hazardous
Material which is used in connection with Tenant's business.
The Certificate and each Updated Certificate shall be
completed and signed by Tenant's environmental risk manager.
38. HOLDING OVER. No holding over by Tenant of the Leased Premises after
the expiration of the Lease Term shall operate to extend the Lease
Term or this Lease, and Tenant shall indemnify, defend and hold
Landlord harmless from all Costs and Expenses and claims for damages
by any other tenant to whom Landlord may have leased to Leased
Premises effective upon the expiration of the Lease Term or
termination of this Lease. Any such holding over shall be deemed a
tenancy at sufferance, subject to all conditions, provisions and
obligations of this Lease insofar as the same are applicable to a
tenancy at sufferance, except that the Base Rent shall be an amount
equal to one hundred ten percent (110%) of the greater of (i) Base
Rent that was applicable at the expiration of the Lease; and (ii)
the fair market rental value as reasonably determined by Landlord.
39. AUTHORITY. The person or persons executing this Lease on behalf of
Landlord and Tenant each hereby represent and warrant to the other
party (Landlord or Tenant, as the case may be) that authority for
the same was duly given as evidenced by the certified copy of
resolution(s) of their respective Boards of Directors.
40. PARKING. Tenant, its officers, directors, employees, agents,
contractors, vendors, licensees and other authorized persons, shall
be entitled to use throughout the Lease Term all vehicular parking
spaces, free of charge on and about the Leased Premises.
41. QUIET TITLE. Provided that Tenant is not in Default under this
Lease, Landlord covenants that, subject to the terms and conditions
of this Lease, from and after the commencement of the Lease Term,
Tenant shall not be disturbed or hindered in Tenant's enjoyment of
the Leased Premises and that Landlord shall not interfere with
Tenant's business activities involving the Leased Premises.
42. BENEFIT. The covenants, terms and conditions of this Lease shall
inure to the benefit of and be binding upon the parties hereto and,
subject to Section 23, their respective successors and assigns.
43. SIGNAGE. Tenant shall be permitted to place such signage on and
about the Leased Premises as are permitted by applicable law;
provided, however, prior to the expiration or
Page 39 of 42
earlier termination of this Lease, Tenant shall remove such signage
from the Leased Premises and restore the Leased Premises to its
condition immediately preceding the installation of such signage.
44. TELECOMMUNICATIONS. Tenant's use of the Leased Premises shall not
include using the Leased Premises to provide telecommunications
services (including, without limitation, Internet connections) to
third parties, it being intended that Tenant's telecommunications
activities within the Leased Premises be strictly limited to such
activities as are incidental to general office use.
45. APPROVALS AND CONSENTS. Unless a party's sole discretion is
otherwise expressly provided for in a particular provision of this
Lease, all approvals and consents required of either party hereunder
shall not be unreasonably withheld or delayed, regardless of whether
or not the provision in question expressly so states.
46. SECURITY DEPOSIT. Concurrently herewith, Tenant shall deposit with
Landlord the sum of Six Hundred Fifty Thousand Dollars
($650,000.00), as security for the performance by Tenant of its
obligations under this Lease, and not as prepayment of Rent (the
"SECURITY DEPOSIT"). Landlord may from time to time apply such
portion of the Security Deposit as is necessary for the following
purposes:
a. to remedy any default by Tenant in the payment of Rent;
b. to repair damage to the Leased Premises caused by Tenant;
c. to clean the Leased Premises upon the expiration or sooner
termination of the Lease; and/or
d. to remedy any other default of Tenant to the extent permitted
by applicable law, including, without limitation, on account
of damages owing to Landlord under Section 24(b), and, in this
regard, Tenant hereby waives any restriction on the uses to
which the Security Deposit may be put, if any.
In the event the Security Deposit or any portion thereof is so used,
Tenant agrees to pay to Landlord promptly upon demand an amount in
cash sufficient to restore the Security Deposit to the full original
amount. Landlord shall not be deemed a trustee of the Security
Deposit, may use the Security Deposit in business, and shall not be
required to segregate it from its general accounts. Tenant shall not
be entitled to any interest on the Security Deposit. If Landlord
transfers the Leased Premises during the Lease Term, Landlord shall
pay the Security Deposit to any transferee of Landlord's interest,
in which event the transferring Landlord will be released from all
liability for the return of the Security Deposit. If Tenant performs
every provision of this Lease to be performed by Tenant, the unused
portion of the Security Deposit shall be returned to Tenant (or, at
Tenant's direction, the last assignee of Tenant's interest under
this Lease), to the extent not applied, within fifteen (15) days
following the expiration or sooner termination of this Lease and the
surrender of the Leased Premises by Tenant to Landlord in accordance
with the terms of this Lease. If this Lease is terminated following
Tenant's Default, the unpaid portion of the Security Deposit, if
any, shall be returned to Tenant two (2) weeks after final
determination of all damages due Landlord. If a Default by Tenant
occurs hereunder, Landlord may require that Tenant deposit with it
such additional amount (either in cash or in a letter of credit) as
Landlord reasonably determines, to be added to and held as a portion
of the Security Deposit.
Page 40 of 42
47. MISCELLANEOUS. This Lease constitutes the entire agreement of the
parties with respect to the subject matter hereof and may be
amended, waived or discharged only by an instrument in writing
signed by the party against which enforcement of such amendment,
waiver or discharge is sought. This Lease shall be binding upon and
inure to the benefit of and be enforceable by the respective
successors and permitted assigns of the parties. The headings in
this Lease are for purposes of reference only and shall not control,
limit or define the meaning or construction of any provision hereof.
Time is of the essence of this Lease. The parties acknowledge that
each party and its counsel have reviewed and revised this Lease and
that the rule of construction to the effect that any ambiguities are
to be resolved against the drafting party shall not be employed in
the interpretation of this Agreement or in any amendments or
exhibits hereto. This Lease shall be construed in accordance with
and governed by the laws of the State of Arizona.
(SIGNATURES TO FOLLOW ON SUCCEEDING PAGE)
Page 41 of 42
IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the
day and year first above written.
Phoenix Industrial Investment Partners, L.P. SpeedFam - IPEC, Inc.,
an Arizona limited partnership an Illinois corporation
By: Glen Una Management Company,
a California corporation
Its: General Partner By: /s/ J. Michael Dodson
----------------------------
Name: J. Michael Dodson
--------------------------
Title: Chief Financial Officer
-------------------------
By: /s/ Kenneth Levy
----------------------------
Name: Kenneth Levy
--------------------------
Title: President
-------------------------
Page 42 of 42
EXHIBIT A
LEGAL DESCRIPTION OF LEASED PREMISES
LOT 1 OF SPEEDFAM INTERNATIONAL, INC., ACCORDING TO THE PLAT OF RECORD IN THE
OFFICE OF THE COUNTY RECORDER OF MARICOPA COUNTY, ARIZONA, RECORDED IN BOOK 439
OF MAPS, PAGE 41.
Exhibit A
Page 1 of 1
EXHIBIT B
TENANT'S EQUIPMENT
The following property shall be included in the definition of Tenant's
Equipment:
BUILDING 305:
CDA Air Compressor Equipment
Air Scrubbers
DI Water System/Equipment
Waste Treatment Equipment
Cleanroom HVAC Equipment
Chemical Distribution/Storage Equipment
Cleanroom Vacuum Equipment
Cleanroom System (walls, partitions, air handlers, hepafilters,
chiller, other)
50 Hertz Generators
7.5 Ton Overhead Cranes
Trolley Mounted Cranes
Surveillance Cameras and Security Equipment
Cafeteria Equipment
BUILDING 300:
CDA Air Compressor Equipment
Cleanroom Vacuum Equipment
Air Scrubbers
Cleanroom Humidity Control Equipment (Kathobar) Roof Boilers for
Kathobar Units Electrical Backup Power Generator 330KV Electrical
Transfer Switch 50 Hertz Generators DI Water System/Equipment
Waste Treatment Equipment Chemical Distribution/Storage Equipment
Cleanroom System (walls, partitions, air handlers, hepafilters,
chiller, other)
Surveillance Cameras and Security Equipment
Acid Fume Safety Hood
Cleanroom Safety Showers
Exhibit B
Page 1 of 1
EXHIBIT C
HAZARDOUS MATERIALS DISCLOSURE CERTIFICATE
Your cooperation in this matter is appreciated. Initially, the information
provided by you in this Hazardous Materials Disclosure Certificate is necessary
for Landlord to evaluate your proposed uses of the Leased Premises. On an annual
basis and at such other times as set forth in Section 37 of the Lease, you are
to provide an update to the information initially provided by you in this
certificate. Any questions regarding this certificate should be directed to, and
when completed, the certificate should be delivered to the Landlord as provided
in the Lease.
GENERAL INFORMATION:
Describe the proposed operations to take place in, on, or about the
Leased Premises, including, without limitation, principal products
processed, manufactured or assembled, and services and activities to be
provided or otherwise conducted. Existing tenants should describe any
proposed changes to on-going operations.
1. USE, STORAGE AND DISPOSAL OF HAZARDOUS MATERIALS
1.1 Will any Hazardous Materials (as hereinafter defined) be used,
generated, treated, stored or disposed of in, on or about the Leased
Premises? Existing tenants should describe any Hazardous Materials
which continue to be used, generated, treated, stored or disposed of
in, on or about the Leased Premises.
Wastes Yes [ ] No [ ]
Chemical Products Yes [ ] No [ ]
Other Yes [ ] No [ ]
If Yes is marked, please explain: __________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
1.2 If Yes is marked in Section 1.1, attach a list of any Hazardous
Materials to be used, generated, treated, stored or disposed of in,
on or about the Leased Premises, including the applicable hazard
class and an estimate of the quantities of such Hazardous Materials
to be present on or about the Leased Premises at any given time;
estimated annual throughput; the proposed location(s) and method of
storage (excluding nominal amounts of ordinary household cleaners
and janitorial supplies which are not regulated by any Environmental
Laws, as hereinafter defined); and the proposed location(s) and
method(s) of treatment or disposal for each Hazardous Material,
including the estimated frequency, and the proposed contractors or
subcontractors. Existing tenants should attach a list setting forth
the information requested above and such list should include actual
data from on-going operations and the identification of any
variations in such information from the prior year's certificate.
Exhibit C
Page 1 of 6
2. STORAGE TANKS AND SUMPS. Is any above or below ground storage or treatment
of gasoline, diesel, petroleum, or other Hazardous Materials in tanks or
sumps proposed in, on or about the Leased Premises? Existing tenants
should describe any such actual or proposed activities.
Yes [ ] No [ ]
If yes, please explain: ____________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
3. WASTE MANAGEMENT
3.1 Has your company been issued an EPA Hazardous Waste Generator I.D.
Number? Existing tenants should describe any additional
identification numbers issued since the previous certificate.
Yes [ ] No [ ]
3.2 Has your company filed a biennial or quarterly reports as a
hazardous waste generator? Existing tenants should describe any new
reports filed.
Yes [ ] No [ ]
If yes, attach a copy of the most recent report filed.
4. WASTEWATER TREATMENT AND DISCHARGE
4.1 Will your company discharge wastewater or other wastes to:
____ storm drain? ____ sewer?
____ surface water? ____ no wastewater or other wastes discharged.
Existing tenants should indicate any actual discharges. If so,
describe the nature of any proposed or actual discharge(s). ________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
________________________________________________________
4.2 Will any such wastewater or waste be treated before discharge?
Yes [ ] No [ ]
Exhibit C
Page 2 of 6
If yes, describe the type of treatment proposed to be conducted.
Existing tenants should describe the actual treatment conducted.
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
________________________________________________________
5. AIR DISCHARGES
5.1 Do you plan for any air filtration systems or stacks to be used in
your company's operations in, on or about the Leased Premises that
will discharge into the air; and will such air emissions be
monitored? Existing tenants should indicate whether or not there are
any such air filtration systems or stacks in use in, on or about the
Leased Premises which discharge into the air and whether such air
emissions are being monitored.
Yes [ ] No [ ]
If yes, please describe: ___________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
________________________________________________________
5.2 Do you propose to operate any of the following types of equipment,
or any other equipment requiring an air emissions permit? Existing
tenants should specify any such equipment being operated in, on or
about the Leased Premises.
____ Spray booth(s) ____ Incinerator(s)
____ Dip tank(s) ____ Other (Please describe)
____ Drying oven(s) ____ No Equipment Requiring Air Permits
If yes, please describe: ___________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
________________________________________________________
5.3 Please describe (and submit copies of with this Hazardous Materials
Disclosure Certificate) any reports you have filed in the past
[thirty-six] months with any governmental or quasi-governmental
agencies or authorities related to air discharges or clean air
requirements and any such reports which have been issued during such
period by any such agencies or authorities with respect to you or
your business operations.
6. HAZARDOUS MATERIALS DISCLOSURES
6.1 Has your company prepared or will it be required to prepare a
Hazardous Materials management plan ("MANAGEMENT PLAN") or Hazardous
Materials Business Plan and Inventory ("BUSINESS PLAN") pursuant to
Fire Department or other governmental or
Exhibit C
Page 3 of 6
regulatory agencies' requirements? Existing tenants should indicate
whether or not a Management Plan is required and has been prepared.
Yes [ ] No [ ]
If yes, attach a copy of the Management Plan or Business Plan.
Existing tenants should attach a copy of any required updates to the
Management Plan or Business Plan.
6.2 Are any of the Hazardous Materials, and in particular chemicals,
proposed to be used in your operations in, on or about the Leased
Premises listed or regulated under Proposition 65? Existing tenants
should indicate whether or not there are any new Hazardous Materials
being so used which are listed or regulated under Proposition 65.
Yes [ ] No [ ]
If yes, please explain: ____________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
________________________________________________________
7. ENFORCEMENT ACTIONS AND COMPLAINTS
7.1 With respect to Hazardous Materials or Environmental Laws, has your
company ever been subject to any agency enforcement actions,
administrative orders, or consent decrees or has your company
received requests for information, notice or demand letters, or any
other inquiries regarding its operations? Existing tenants should
indicate whether or not any such actions, orders or decrees have
been, or are in the process of being, undertaken or if any such
requests have been received.
Yes [ ] No [ ]
If yes, describe the actions, orders or decrees and any continuing
compliance obligations imposed as a result of these actions, orders
or decrees and also describe any requests, notices or demands, and
attach a copy of all such documents. Existing tenants should
describe and attach a copy of any new actions, orders, decrees,
requests, notices or demands not already delivered to Landlord
pursuant to the provisions of Article 7 of the Lease Agreement.
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
________________________________________________________
7.2 Have there ever been, or are there now pending, any lawsuits against
your company regarding any environmental or health and safety
concerns?
Yes [ ] No [ ]
Exhibit C
Page 4 of 6
If yes, describe any such lawsuits and attach copies of the
complaint(s), cross-complaint(s), pleadings and other documents
related thereto as requested by Landlord. Existing tenants should
describe and attach a copy of any new complaint(s), cross-
complaint(s), pleadings and other related documents not already
delivered to Landlord pursuant to the provisions of Article 7 of the
Lease Agreement. ___________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
________________________________________________________
7.3 Have there been any problems or complaints from adjacent tenants,
owners or other neighbors at your company's current facility with
regard to environmental or health and safety concerns? Existing
tenants should indicate whether or not there have been any such
problems or complaints from adjacent tenants, owners or other
neighbors at, about or near the Leased Premises and the current
status of any such problems or complaints.
Yes [ ] No [ ]
If yes, please describe. Existing tenants should describe any such
problems or complaints not already disclosed to Landlord under the
provisions of the signed Lease Agreement and the current status of
any such problems or complaints.
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________
________________________________________________________
8. PERMITS AND LICENSES. Attach copies of all permits and licenses issued to
your company its proposed operations in, on or about the Leased Premises,
including, without limitation, any Hazardous Materials permits, wastewater
discharge permits, air emissions permits, and use permits or approvals.
Existing tenants should attach copies of any new permits and licenses as
well as any renewals of permits or licenses previously issued.
As used herein, the term "HAZARDOUS MATERIALS" means any hazardous or toxic
substance, material or waste which is or becomes regulated by any local
governmental authority, the State of Arizona or the United States government.
The term "HAZARDOUS MATERIALS" includes, without limitation, petroleum products,
asbestos, PCB's, and any material or substance which is (i) listed under, or
defined as hazardous or extremely hazardous pursuant to The Arizona
Environmental Quality Act of 1986, A.R.S. Section 49-101, et. seq., (ii) deemed
as a "hazardous waste" pursuant to Section 1004 of the Federal Resource
Conservation and Recovery Act, 42 U.S.C. 6901 et seq. (42 U.S.C. 6903) ("RCRA"),
(iii) defined as a "hazardous substance" pursuant to Section 101 of the
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
9601 et seq. (42 U.S.C. 9601) ("CERCLA") or any regulations promulgated under
CERCLA; (iv) any substance now or hereafter regulated by the Toxic Substances
Control Act, as amended ("TSCA") (15 U.S.C. Section 2601 et seq.) or any
regulations promulgated under TSCA; (v) petroleum, petroleum by-products,
gasoline, diesel fuel, or other petroleum hydrocarbons; (vi) asbestos and
asbestos-containing material, in any form, whether friable or non-friable; (vii)
polychlorinated biphenyls; (viii) lead and lead-containing materials; or (ix)
any additional substance, material or waste. As used herein, the term "HAZARDOUS
MATERIAL LAW(S)" shall mean any statute, law,
Exhibit C
Page 5 of 6
ordinance, or regulation of any governmental body or agency (including the U.S.
Environmental Protection Agency, the Arizona Department of Environmental Quality
which regulates the use, storage, release or disposal of any Hazardous
Materials.
The undersigned hereby acknowledges and agrees that this Hazardous Materials
Disclosure Certificate is being delivered to Landlord in connection with the
evaluation of a Lease and, if such Lease is executed, will be attached thereto
as an exhibit. The undersigned further acknowledges and agrees that if such
Lease is executed, this Hazardous Materials Disclosure Certificate will be
updated from time to time in accordance with Section 37 of the Lease. The
undersigned further acknowledges and agrees that Landlord and its partners,
lenders and representatives may, and will, rely upon the statements,
representations, warranties, and certifications made herein and the truthfulness
thereof in entering into the Lease and the continuance thereof throughout the
term, and any renewals thereof, of the Lease. I, the undersigned, acting with
full authority to bind the Tenant and on behalf of the Tenant, certify,
represent and warrant that the information contained in this certificate is true
and correct.
SpeedFam-IPEC, Inc.
an Illinois corporation
By:______________________
Name:____________________
Its:_____________________
Date:____________________
Exhibit C
Page 6 of 6
EXHIBIT D
SOFTWARE MAINTENANCE SCHEDULE
[SEE ATTACHED]
Exhibit D
Page 1 of 1