SORRENTOVIEW
Industrial Real Estate Triple Net Sublease
(Lease Extension)
ARTICLE I
BASIC TERMS
This Article One contains the Basic Terms of this Sublease between the Landlord
and Tenant named below. This Sublease is subject to the Master Lease identified
in Section 2.1 below. Other Articles, Sections and Subsections of the Sublease
referred to in this Article One explain and define the Basic Terms and are to be
read in conjunction with the Basic Terms.
1.1 DATE OF SUBLEASE. April 1, 1993
1.2 LANDLORD. GAP Portfolio Partners, a New York general partnership.
Address of Landlord: c/o Richardson Partners, Inc., 10211 Pacific Mesa Blvd.,
Suite 4067, San Diego, CA 92121.
1.3 TENANT. Camino Laboratories, a Delaware corporation.
Address of Tenant: 5955 Pacific Center Blvd., San Diego, CA 92121
1.4 PREMISES. In consideration of the rents, covenants and agreement on the part
of the Tenant to be paid and performed, the Landlord subleases to the Tenant,
and Tenant subleases from Landlord those certain Premises identified on Exhibit
"A" attached hereto and by this reference incorporated herein. The Premises
contain approximately 19,897 square feet of space, and are situated within that
certain building ("Building") known as Building 6 (Entire Building) and located
at 5955 Pacific Center Blvd., San Diego, CA 92121. The Building is situated
within that certain project ("Project") known as SORRENTOVIEW, located at the
eastside of Pacific Mesa Boulevard, between Pacific Mesa Court and Pacific
Center Boulevard, San Diego, California, more particularly identified on Exhibit
"B" attached hereto and by this reference incorporated herein.
1.5 SUBLEASE TERM. Fifty-one (51) Months, beginning on April 1, 1993 or such
date as is specified in this Sublease, and ending on June 30, 1997 (See Article
Two).
1.6 PERMITTED USES. The Premises shall be used and occupied only for general
office, and medical equipment laboratory, assembly, and warehousing purposes.
(See Section 5.1).
1.7 TENANT'S GUARANTOR. (If none, so state.) None.
1.8 INITIAL SECURITY DEPOSIT. (See Section 3.3) Thirteen thousand one hundred
nine dollars ($13,109.00)
1.9 RENT AND OTHER CHARGES PAYABLE BY TENANT.
1.9.1 BASE RENT. Thirteen thousand one hundred nine dollars ($13,109.00)
per month for the first twelve (12) months, as provided, in Section 3.1, and
shall be increased on each annual anniversary of the Commencement Date,
beginning one (1) year after the Commencement Date, by three percent (3%) of the
Base Rent in effect during the immediately preceding one year period.
1.9.2 OTHER PERIODIC PAYMENTS: ADDITIONAL RENT. (i) Real Property Taxes;
(ii) Utilities; (iii) Insurance Premiums; (iv) Common Area Charges; (v) Impounds
for Insurance Premiums and Property Taxes; (vi) Maintenance, Repairs and
Alterations (See Articles Four and Six). See Additional Provision Sublease
Rider.
1.10 RIDERS. The following Riders are attached to and made a part of this
Sublease. (If none, so state.)
1. Additional Provisions
2. Tenant Improvement
3. Option to Extend
ARTICLE II
SUBLEASE TERM
2.1 MASTER LEASE. Landlord is the ground lessee of the real property improved
with and identified as the Project under that certain Lease dated August 25,
1987, by and between the San Diego Unified School District ("District") as
lessor and Landlord as lessee (the "Master Lease"). The Master Lease provides
that Landlord may construct improvements and sublease portions thereof to
tenants. Accordingly, and subject to the Master Lease, Landlord is entering into
this sublease with Tenant.
2.2 SUBLEASE OF PREMISES FOR SUBLEASE TERM. Landlord subleases the Premises to
Tenant and Tenant subleases the Premises from Landlord for the Sublease Term.
The Sublease Term is for the period stated in Section 1.5 above and shall begin
and end on the dates specified in Section 1.5 above, unless the beginning or end
of the Sublease Term is changed under any provision of this Sublease. The
"Commencement Date" shall be the date specified in Section 1.5 above for the
beginning of the Sublease Term, unless advanced or delayed under any provision
of this Sublease.
2.3 DELAY IN COMMENCEMENT. Landlord shall not be liable to Tenant if Landlord
does not deliver possession of the Premises to Tenant on the first date
specified in Section 1.5 above. Landlord's non-delivery of the Premises to
Tenant on that date shall not affect this Sublease or the obligations of Tenant
under this Sublease. However, the Commencement Date shall be delayed until
possession of the Premises is delivered to Tenant. The Sublease Term shall be
extended for a period equal to the delay in delivery of possession of the
Premises to Tenant, plus the number of days necessary to end the Sublease Term
on the last day of a month. If Landlord does not deliver possession of the
Premises to Tenant within ninety (90) days after
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the first date specified in Section 1.5 above, Tenant may elect to cancel this
Sublease by giving written notice to Landlord within ten (10) days after the
90-day period ends. If Tenant gives such notice, the Sublease shall be cancelled
and neither Landlord nor Tenant shall have any further obligations to the other.
If Tenant does not give such notice, Tenant's right to cancel the Sublease shall
expire and the Sublease Term shall commence upon the delivery of possession of
the Premises to Tenant. If delivery of possession of the Premises to Tenant is
delayed, Landlord and Tenant shall, upon such delivery, execute an amendment to
this Sublease setting forth the Commencement Date and expiration date of the
Sublease. For purposes of this Section 2.3, Landlord's delivery of possession of
the Premises shall mean the earlier of (i) the date Tenant occupies all or any
portion of the Premises, or (ii) the date upon which the Premises are
substantially complete in accordance with Exhibit A.
2.4 EARLY OCCUPANCY. If Tenant occupies the Premises prior to the Commencement
Date, Tenant's occupancy of the Premises shall be subject to all of the
provisions of this Sublease. Early occupancy of the Premises shall not advance
the expiration date of this Sublease. Tenant shall pay Base Rent and all other
charges specified in this Sublease for the early occupancy period.
2.5 HOLDING OVER. Tenant shall vacate the Premises upon the expiration or
earlier termination of this Sublease. Tenant shall reimburse Landlord for and
indemnify Landlord against all damages incurred by Landlord from any delay by
Tenant in vacating the Premises. If Tenant remains in possession of all or any
part of the Premises after the expiration of the term hereof, with or without
the express or implied consent of Landlord, such tenancy shall be from
month-to-month only and not a renewal hereof or an extension for any further
term, and in such case, Base Rent then in effect shall be increased by
twenty-five percent (25%) and other monetary sums due hereunder shall be payable
in the amount and at the time specified in this Sublease; and such
month-to-month tenancy shall be subject to every other term, covenant and
agreement contained herein, except that the month-to-month tenancy will be
terminable on thirty (30) days notice given at any time by either party.
2.6 SURRENDER OF PREMISES. Upon the termination of the Sublease, Tenant shall
surrender the Premises to Landlord in the condition specified in and according
to Section 6.7.
Article III
BASE RENT
3.1 TIME AND MANNER OF PAYMENT. Upon execution of this Sublease, Tenant shall
pay Landlord the Base Rent in the amount stated in Subsection 1.9.1 above for
the first month of the Sublease Term. On the first day of the second month of
the Sublease Term and each month thereafter, Tenant shall pay Landlord the Base
Rent in United States currency, in advance, without offset, deduction or prior
demand. The Base Rent shall be payable at Landlord's address or at such other
place as Landlord may designate in writing.
3.2 INCREASE. The Base Rent shall be increased at the times specified in
Subsection 1.9.1 above. Tenant shall be obligated to pay the new Base Rent from
its effective date until the next periodic increase without any prior notice
from Landlord.
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3.3 SECURITY DEPOSIT INCREASES.
3.3.1 DEPOSIT. Upon the execution of this Sublease, Tenant shall deposit with
Landlord a cash Security Deposit in the amount set forth in Section 1.8
above. Landlord may apply all or part of the Security Deposit to any
unpaid rent or other charges due from Tenant or to cure any other defaults
of Tenant. If Landlord uses any part of the Security Deposit, Tenant shall
restore the Security Deposit to its full amount within ten (10) days after
Landlord's written request. Tenant's failure to do so shall be a material
default under this Sublease. No interest shall be paid on the Security
Deposit. Landlord shall not be required to keep the Security Deposit
separate from its other accounts and no trust relationship is created with
respect to the Security Deposit.
3.4 TERMINATION; ADVANCE PAYMENTS. Upon termination of this Sublease under
Article Seven (Damage or Destruction), Article Eight (Condemnation), or any
other termination not resulting from Tenant's default, and after Tenant has
vacated the Premises in the manner required by this Sublease, an equitable
adjustment shall be made concerning advance rent, any other advance payments
made by Tenant to Landlord, and accrued real property taxes, and Landlord shall
refund the unused portion of the Security Deposit to Tenant or Tenant's
successor.
Article IV
OTHER CHARGES PAYABLE BY TENANT
4.1 ADDITIONAL RENT. All charges payable by Tenant other than Base Rent are
called "Additional Rent." Unless this Sublease provides otherwise, all
Additional Rent shall be paid with the next monthly installment of Base Rent and
shall be in United States currency. The term "rent" shall mean Base Rent and
Additional Rent.
4.2 REAL PROPERTY TAXES.
4.2.1 PAYMENT OF TAXES. Tenant shall pay its proportionate share of all
real property taxes and general and special assessments, levied and assessed
against the Project of which the Premises are a part. Tenant's proportionate
share of real property taxes shall be the ratio that the total number of square
feet in the Premises bears to the total number of sub-leasable square feet in
the Project. Each year Landlord shall notify Tenant of Landlord's calculation of
Tenant's proportionate share of the real property taxes and together with such
notice shall furnish Tenant with a copy of the tax bill. If any supplemental tax
bills are delivered with respect to the Project, Landlord may notify Tenant of
Landlord's new calculation of Tenant's proportionate share of real property
taxes as soon as such supplemental tax bill is received. Subject to Section 4.8
below, Tenant shall reimburse Landlord for Tenant's proportionate share of the
Real Property Taxes semiannually no later than fifteen (15) days before the
taxing authority's delinquency date.
4.2.2 DEFINITION OF "REAL PROPERTY TAX." "Real Property Tax" means: (i)
any fee, license fee, license tax, commercial rental tax, levy, charge,
assessment, penalty or tax (other than inheritance or estate taxes) imposed by
any authority having the direct or indirect power to tax, including any City,
County, State or Federal government, or any school, agriculture, lighting,
drainage or other improvement district thereof, as against any legal or
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equitable interest of Landlord in the Premises; (ii) any tax on the Landlord's
right to receive, or the receipt of, rent or income from the Premises or against
Landlord's business of leasing the Premises; (iii) any tax or charge for fire
protection, streets, sidewalks, road maintenance, refuse or other services
provided to the Premises by any governmental agency; (iv) any tax imposed upon
this transaction or based upon a reassessment of the Premises due to a change in
ownership or transfer of all or part of Landlord's interest in the Premises; and
(v) any charge or fee replacing any tax previously included within the
definition of Real Property Tax. "Real Property Tax" does not, however, include
Landlord's Federal or State income, franchise, inheritance or estate taxes.
4.2.3 JOINT ASSESSMENT. If the Premises is not separately assessed,
Tenant's share of the Real Property Tax payable by Tenant under Subsection 4.2.1
shall be determined from reasonably available information. Landlord shall make a
reasonable determination of Tenant's proportionate share of such real property
tax and Tenant shall pay such share to Landlord within fifteen (15) days after
receipt of Landlord's written statement.
4.2.4 PERSONAL PROPERTY TAXES.
(a) Tenant shall pay prior to delinquency all taxes charged against
trade fixtures, furnishings, equipment or any other personal property belonging
to Tenant. Tenant shall attempt to have such personal property taxed separately
from the Premises.
(b) If any such taxes on Tenant's personal property are levied
against Landlord or Landlord's Premises, or if the assessed value of the
Premises is increased by the inclusion therein of a value placed upon such
personal property or trade fixtures of Tenant, then Landlord, after written
notice to Tenant, shall have the right to pay the taxes based upon such
increased assessments, regardless of the validity thereof, but only under proper
protest if requested by Tenant in writing. If Landlord shall do so, then Tenant
shall, upon demand, repay to Landlord the taxes levied against Landlord, or the
proportion of such taxes resulting from such increase in the assessment. In any
such event, however, Tenant, at Tenant's sole cost and expense, shall have the
right, in the name of Landlord and with Landlord's full cooperation, to bring
suit in any court of competent jurisdiction to recover the amount of any such
taxes so paid under protest; any amount so recovered to belong to Tenant.
(c) If any of Tenant's personal property is taxed with the Premises,
Tenant shall pay Landlord the taxes for the personal property within fifteen
(15) days after Tenant receives a written statement from Landlord for such
personal property taxes.
4.2.5 TENANT'S RIGHT TO CONTEST TAXES. Tenant may attempt to have the
assessed valuation of the Premises reduced or may initiate proceedings to
contest the Real Property Tax. If required by law, Landlord shall join in the
proceedings brought by Tenant. However, Tenant shall pay all costs of the
proceedings, including any costs or fees incurred by Landlord. Upon the final
determination of any proceeding or contest, Tenant shall immediately pay the
excess Real Property Tax due, together with all costs, charges, interest and
penalties incidental to the proceedings. If Tenant does not pay the excess Real
Property Tax when due when due and contests such taxes, Tenant shall not be in
default under this Sublease for nonpayment of such taxes if Tenant deposits
funds with Landlord or opens an interest bearing
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account reasonably acceptable to Landlord in the joint names of Landlord and
Tenant. The amount of such deposit shall be sufficient to pay the excess Real
Property Tax plus a reasonable estimate of the interest, costs, charges and
penalties which may accrue if Tenant's action is unsuccessful, less any
applicable tax impounds previously paid by Tenant to Landlord. The deposit shall
be applied to the excess Real Property Tax due, as determined at such
proceedings. The excess Real Property Tax shall be paid under protest from such
deposit if such payment under protest is necessary to prevent the Premises from
being sold under a "tax sale" or similar enforcement proceeding.
4.3 UTILITIES. Tenant shall arrange for and pay, directly to the appropriate
supplier, the cost of all natural gas, heat, light, power, sewer, telephone,
water and other utilities and services supplied to the Premises. Landlord will
cooperate in attempting to have each of the utilities supplied to the Premises
separately metered. However, if any such utilities or services are jointly
metered with other premises within the Project, Landlord shall make a reasonable
determination of Tenant's proportionate share of the cost of such utilities and
services, based on information reasonably available to Landlord, and Tenant
shall pay such share to Landlord within fifteen (15) days after receipt of
Landlord's written statement of such cost.
4.4 INSURANCE PREMIUMS.
4.4.1 LIABILITY INSURANCE. During the Sublease Term, Landlord shall
maintain a policy of comprehensive public liability insurance at Tenant's
expense, insuring Landlord against liability arising out of the ownership, use,
occupancy or maintenance of the Premises. The initial amount of such insurance
shall be at least $5,000,000.00, and shall be subject to periodic increase based
upon inflation, increased liability awards, recommendations of professional
insurance advisers, and other relevant factors. However, the amount of such
insurance shall not limit Tenant's liability nor relieve Tenant of any
obligation hereunder. The policy shall contain cross-liability endorsements, if
applicable, and shall insure Tenant's performance of the indemnity provisions of
Section 5.4. Tenant shall, at Tenant's expense, maintain such other liability
insurance as Tenant deems necessary to protect Tenant.
4.4.2 HAZARD AND RENTAL INCOME INSURANCE. During the Sublease Term,
Landlord shall, at Tenant's expense, maintain policies of insurance covering
loss of or damage to the Premises to the extent of at least one hundred percent
(100%) of its replacement value. Such policies shall provide protection against
all perils included within the classification of fire, extended coverage,
vandalism, malicious mischief, and any other perils which Landlord deems
necessary. Landlord may obtain insurance coverage for Tenant's fixtures,
equipment or building improvements installed by Tenant in or on the Premises.
Tenant shall, at Tenant's expense, maintain such primary or additional insurance
on its fixtures, equipment and building improvements as Tenant deems necessary
to protect its interest. During the Sublease Term, Landlord may also maintain a
rental income insurance policy at Tenant's expense, with loss payable to
Landlord in an amount equal to one year's Base Rent (as adjusted periodically),
estimated Real Property Taxes and insurance premiums. Tenant shall not do or
permit to be done anything which invalidates any such insurance policies.
4.4.3 PAYMENT OF PREMIUMS; INSURANCE POLICIES. Tenant shall pay its pro
rata share of the premiums for maintaining the insurance required by Subsections
4.4.1 and
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4.4.2. Tenant's pro rata share of all such premiums shall be based on
the same proportion as used for payment of taxes pursuant to Subsection 4.2.1
hereof. All such amounts will be due and payable upon ten (10) days written
notice.
4.4.4 INCREASE IN FIRE INSURANCE PREMIUM. Tenant agrees that it will not
keep, use, manufacture, assemble, sell or offer for sale in or upon the Premises
any article which may be prohibited by the standard form of fire insurance
policy. Tenant agrees to pay any increase in premiums for fire and extended
coverage insurance that may be charged during the term of this Sublease on the
amount of such insurance which may be carried by Landlord on said Premises or
the building of which it is a part, resulting from the acts or omissions of the
Tenant, its agents, servants or employees, or the use or occupancy of the
Premises by the Tenant or from the type of materials or products stored,
manufactured, assembled or sold by Tenant in the Premises, whether or not
Landlord has consented to the same. In determining whether increased premiums
are the result of Tenant's use of the Premises, a schedule, issued by the
organization making the insurance rate on the Premises, showing the various
components of such rate, shall be conclusive evidence of the several items and
charges which make up the fire insurance rate on the Premises.
4.4.5 WAIVER OF SUBROGATION. Landlord and Tenant each hereby waive any and
all rights of recovery against the other or against the officers, employees,
agents and representatives of the other, on account of loss or damage occasioned
to such waiving party or its property or the property of others under its
control, to the extent that such loss or damage is insured against under any
fire and extended coverage insurance policy which either may have in force at
the time of such loss or damage. Tenant shall, upon the policies of insurance
required under this Sublease, give notice to the insurance carrier or carriers
that the foregoing mutual waiver of subrogation is contained in this Sublease.
4.5 COMMON AREAS.
4.5.1 DEFINITION; LOCATION. As used in this Sublease, "Common Areas" shall
mean all areas within the Project which are available for the common use of
tenants of the Project and which are not leased or held for the exclusive use of
tenants of the Project or which are not leased or held for the exclusive use of
Tenant or other tenants, including, but not limited to, parking areas,
driveways, sidewalks, loading areas, retaining walls, truck serviceways,
pedestrian malls, stairs, ramps, restrooms, access roads, corridors, landscaping
and planted areas. Landlord may from time to time change the size, location,
nature and use of the Common Areas, including converting Common Areas into
leasable areas, construction of additional parking facilities (including parking
structures) in the Common Areas, and increasing or decreasing Common Area land
and/or facilities. Tenant acknowledges that such activities may result in
occasional inconvenience to Tenant from time to time. Such activities and
changes shall be expressly permitted if they do not materially affect Tenant's
use of the Premises.
4.5.2 USE OF COMMON AREAS. Subject to other provisions of this Sublease,
Tenant shall have the nonexclusive right (in common with other tenants and all
others to whom Landlord has granted or may grant such rights) to use the Common
Areas for the purposes intended, subject to such reasonable rules and
regulations as Landlord may establish from time to time. Tenant shall abide by
such rules and regulations and shall use its best effort to cause others
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who use the Common Areas with Tenant's expressed or implied permission to abide
by Landlord's rules and regulations. At any time, Landlord may close any Common
Areas to perform any acts in and to the Common Areas as, in Landlord's judgment,
may be desirable to improve the Project. Tenant shall not, at any time,
intentionally interfere with the rights of Landlord, other tenants, or any other
person entitled to use the Common Areas.
4.5.3 VEHICLE PARKING. Tenant shall be entitled to use 3.8 vehicle parking
spaces in the Project for each 1,000 (One Thousand) square feet within the
Premises without paying any additional rent. Tenant's parking shall not be
reserved and shall be limited to vehicles no larger than standard size
automobiles or pickup utility vehicles. Tenant shall not cause large trucks or
other large vehicles to be parked within the Project or on the adjacent public
streets. Vehicles shall be parked only in striped parking spaces and not in
driveways, loading areas or other locations not specifically designated for
parking. If Tenant parks more vehicles in the parking area than the number
identified herein, such conduct shall be a material breach of the Sublease.
4.5.4 MAINTENANCE OF COMMON AREAS. Landlord shall maintain the Common
Areas in good order, condition and repair and shall operate the Project, in
Landlord's sole discretion, as a first class industrial/commercial real property
development. Tenant shall pay Tenant's pro rata share (as defined below) of all
costs incurred by Landlord for the operation and maintenance of the Common Area.
Common Area costs include, but are not limited to, costs and expenses for the
following: gardening and landscaping; pest extermination services; utilities,
water and sewage charges; maintenance of signs (other than Tenant's signs);
premiums for liability, property damage, fire and other types of casualty
insurance on the Common Areas and all Common Area improvements; all personal
properly taxes levied on or attributable to personal property used in connection
with the Common Areas; straight-line depreciation on personal property owned by
Landlord which is consumed in the operation or maintenance of the Common Areas;
rental or lease payments paid by Landlord for rented or leased personal property
used in the operation or maintenance of the Common Areas; the reasonable rental
value of any Common Area located within any building situated within the
Project; fees for management of the Project and Common Areas; fees for required
licenses and permits; repairing, resurfacing, repaving, maintaining , painting,
lighting, cleaning, refuse removal, security and similar items; reserves; and a
reasonable allowance to Landlord for Landlord's supervision of the Common Areas
(not to exceed five percent (5%) of the total of all other Common Area costs for
the calendar year). Landlord may cause any or all of such services to be
provided by third parties, or by entities associated with Landlord. Common Area
costs shall not include depreciation of real property which forms part of the
Common Areas. Landlord may, at Landlord's election, estimate in advance and
charge to Tenant monthly as Common Area costs, all real property taxes for which
Tenant is liable under the Sublease, all insurance premiums for which Tenant is
liable under the Sublease, and all maintenance and repair costs for which Tenant
is liable under the Sublease.
4.5.5 TENANT'S SHARE AND PAYMENT. Tenant shall pay Tenant's annual pro
rata share of all estimated Common Area costs, in advance, in monthly
installments on the first day of each month during the Sublease Term (prorated
for any fractional month). Tenant's pro rata share shall be calculated by
dividing the square foot area of the Premises, as set forth in Section 1.4 of
the Sublease, by the aggregate square foot area of the leaseable area within the
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Project, whether currently leased or not upon the date the computation is made.
Landlord may adjust such estimates at any time and from time to time based upon
Landlord's experience and reasonable anticipation of costs. Such adjustments
shall be effective as of the next rent payment date after notice to Tenant.
Within thirty (30) days after the end of each calendar year of the Sublease
Term, Landlord shall deliver to Tenant a statement prepared in accordance with
generally accepted accounting principles setting forth, in reasonable detail,
the actual Common Area costs paid or incurred by Landlord during the preceding
calendar year and Tenant's pro rata share. Upon receipt of such statement, there
shall be an adjustment between Landlord and Tenant with payment to or credit
given by Landlord (as the case may be) so that Landlord shall receive the entire
amount of Tenant's share of such costs and expenses for such period. Any changes
in the Common Area costs and/or the aggregate area leased or held for lease for
the exclusive use of all tenants of the Project during the Lease Term shall be
effective on the first day of the month after such change occurs.
4.5.5.1 ALTERNATIVE PAYMENT. Notwithstanding the foregoing, Landlord has
the right to notify Tenant on a monthly or other basis of the actual amount
Landlord has expended for all Common Area costs incurred during the previous
month or period. Such notice shall also set forth Tenant's pro rata share of
such actual costs. Upon receipt of such statement, Tenant shall pay with the
next monthly installment of rent Tenant's pro rata share of the actual Common
Area costs incurred during the previous month or period.
4.5.6 ADDITIONAL AREAS. In addition to the Common Areas and costs
associated therewith described in this Section 4.5, Landlord may, but is not
obligated to, provide certain additional spaces and areas within the Project
("Additional Areas") as (and included within the definition of) Common Areas.
The Additional Areas may include, but are not limited to, an office used by and
subject to the exclusive control of Landlord for leasing and/or managing the
Project, a conference room available on a reserved basis for use by tenants
within the Project during normal business hours, and a locker room facility for
use by tenants of the Project and their employees that are employed at the
Project. Common Area costs for which Tenant is liable for its pro rata share as
described in Section 4.5.4 shall include costs of operating and the reasonable
rental value of the space occupied by the Additional Areas.
4.6 LATE CHARGES. Tenant's failure to pay rent promptly may cause Landlord to
incur unanticipated costs. The exact amount of such costs is impractical or
extremely difficult to ascertain. Such costs may include, but are not limited
to, processing and accounting charges and late charges which may be imposed on
Landlord by any ground sublease, mortgage or trust deed encumbering the
Premises. Therefore, if Landlord does not receive any rent payment within five
(5) days after it becomes due, Tenant shall pay Landlord a late charge equal to
five percent (5%) of the overdue amount. The parties agree that such late charge
represents a fair and reasonable estimate of the costs Landlord will incur by
reason of such late payment.
4.6.1 REPEATED LATE CHARGES. In the event that a late charge is payable
under this Sublease whether or not collected, for two installments of Base Rent
during any one calendar year of the Sublease Term, then the Base Rent shall
automatically become due and payable quarterly in advance, rather than monthly.
All monies paid to Landlord under this provision may be commingled with other
monies of Landlord and shall not bear interest.
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4.7 INTEREST ON PAST DUE OBLIGATIONS. Any amount owed by Tenant to Landlord
which is not paid when due shall bear interest at the rate of ten percent (10%)
per annum or at the highest rate then permitted by law, whichever is less, from
the due date of such amount. However, interest shall not be payable on late
charges to be paid by Tenant under this Sublease. The payment of interest of
such amounts shall not excuse or cure any default by Tenant under this Sublease.
If the interest rate specified in this Sublease is higher than the rate
permitted by law, the interest rate is hereby decreased to the maximum legal
interest rate permitted by law.
4.8 IMPOUNDS FOR INSURANCE PREMIUMS AND REAL PROPERTY TAXES. If requested by any
ground lessor or lender to whom Landlord has granted a security interest in the
Premises or the Project if Landlord deems it necessary in Landlord's sole and
absolute discretion, or if Tenant is more than ten (10) days late in the payment
of rent more than once in any consecutive twelve (12) month period, Tenant shall
pay Landlord a sum equal to one-twelfth (1/12) of the annual Real Property Tax
and/or insurance premiums payable by Tenant under this Sublease, together with
each payment of Base Rent. Such payment shall be paid to the ground lessor or
lender if required or held by Landlord in an impound account with no obligation
to pay the Tenant interest thereon. The amount of the Real Property Tax and
insurance premiums when unknown shall be reasonably estimated by Landlord. Funds
in the impound account shall be applied by Landlord to the payment of real
property taxes and insurance premiums when due. Any deficiency of funds in the
impound account shall be paid by Tenant to Landlord up on written request. If
Tenant defaults under this Sublease, Landlord may apply any funds in the impound
account to any obligation then due under this Sublease.
ARTICLE V
USE OF PREMISES
5.1 PERMITTED USES. Tenant may use the Premises only for the Permitted Uses set
forth in Section 1.6 above.
5.2 MANNER OF USE.
5.2.1 OBJECTIONABLE USES. Tenant shall not do or permit anything to be
done in or about the Premises which will in any way obstruct or interfere with
or infringe on the rights of other occupants of the building, or injure or annoy
them, or use or allow the Premises to be used for any improper, immoral, or
objectionable purposes; nor shall Tenant cause, maintain or permit any nuisance
in, on or about the Premises or commit or suffer to be committed any waste in,
on or about the Premises. Tenant shall not be liable to Landlord for any other
occupant's failure to so conduct itself.
5.2.2 NONPERMITTED USES. Tenant shall not do or permit to be done in or
about the Premises nor bring, keep or permit to be brought or kept therein,
anything which is prohibited by or will in any way conflict with any law,
statute, ordinance or governmental rule or regulation now in force or which may
hereafter be enacted or promulgated, or which is prohibited by any standard form
of fire insurance policy or will in any way increase the existing rate of or
affect any fire or other insurance upon the building or any part thereof or any
of its contents, or cause a
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cancellation of any insurance policy covering the building or any part thereof
or any of its contents. Tenant shall comply with all governmental laws,
ordinances and regulations applicable to the Premises, and the requirements of
any Board of Fire Underwriters or other similar body now or hereafter
instituted, with any order, directive or certificate of occupancy issued
pursuant to any law, ordinance or regulation by any public officer insofar as
the same relates to or affects the condition, use or occupancy of the Premises,
including but not limited to, requirements of structural changes related to or
affected by Tenant's acts, occupancy or use of the Premises, all at Tenant's
sole expense. The judgment of any court of competent jurisdiction or the
admission of Tenant in any action against Landlord, whether or not Tenant is a
party to such action, shall be conclusive in establishing such violations
between Landlord and Tenant.
5.2.3 NOXIOUS ODORS. Tenant shall not use, keep or permit to be used or
kept any foul or noxious gas or substance in the Premises, or permit or suffer
the Premises to be occupied or used in a manner offensive or objectionable to
the Landlord or other occupants of the building by reason of noise, odors and/or
vibrations, or interfere in any way with other Tenants or those having business
therein, nor shall any animals or birds be brought in or kept in or about the
Premises or the building. Tenant shall not conduct any auction on the Premises.
No cooking shall be done or permitted by any Tenant on the Premises, nor shall
the Premises be used for the storage of merchandise, for washing clothes, for
lodging, or for any improper, objectionable or immoral purposes. Tenant shall
not use or keep in the Premises or the building any kerosene, gasoline or
inflammable or combustible fluid or material, or use any method of heating or
air conditioning other than supplied by Landlord.
5.2.4 PERMIT. Tenant shall obtain and pay for all permits required for
Tenant's occupancy of the Premises and shall promptly take all actions necessary
to comply with all applicable statutes, ordinances, rules, regulations, orders
and requirements regulating the use by Tenant of the Premises, including the
Occupational Health and Safety Act.
5.3 SIGNS AND AUCTIONS.
5.3.1 AUCTION. Tenant shall not conduct, or permit to be conducted, any
sale by auction on the Premises.
5.3.2 PROHIBITED SIGNS. Tenant shall not place, or suffer to be placed or
maintained, on any exterior door, wall or window of the Premises any sign,
awning or canopy, or advertising matter or other thing of any kind, and will not
place or maintain any decoration, lettering or advertising matter on the glass
of any window or door, or that can be seen through the glass, of the Premises
without Landlord's prior written approval. Tenant further agrees to maintain
such sign, awning, canopy, decoration, lettering, advertising matter or thing as
may be approved, in good condition and repair at all times.
5.3.3 SIGN CRITERIA. Landlord not required to install any sign for Tenant.
5.4 HAZARDOUS MATERIALS.
5.4.1 PROHIBITION OF STORAGE. Tenant shall not cause or permit any
Hazardous Material (as hereinafter defined) to be brought upon, kept or used in
or about the
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Premises or the Project by Tenant, its agents, employees, contractors or
invitees, other than those expressly permitted by Landlord and identified below.
If Tenant breaches the obligation stated in the preceding sentence, or if the
presence of Hazardous Materials on the Premises caused or permitted by Tenant
(including Hazardous Materials specifically permitted and identified below)
results in contamination of the Premises, or if contamination of the Premises by
Hazardous Material otherwise occurs for which Tenant is legally liable to
Landlord for damage resulting therefrom, then Tenant shall indemnify, defend and
hold Landlord, its agents and contractors harmless from any and all claims,
judgments, damages, penalties, fines, costs, liabilities, or losses (including
without limitation diminution in value of the Premises or any portion of the
Project, damages for the loss or restriction on use of rentable or usable space
or of any amenity of the Premises or Project, damages arising from any adverse
impact on marketing of space in the Premises or the Project, and sums paid in
settlement of claims, attorneys' fees, consultant fees and expert fees) which
arise during or after the Sublease Term as a result of such contamination. This
indemnification of Landlord by Tenant includes, without limitation, costs
incurred in connection with any investigation of site conditions or any cleanup,
remedial, removal, or restoration work required by any federal, state or local
governmental agency or political subdivision because of Hazardous Material
present in the soil or ground water on or under the Premises. Without limiting
the foregoing, if the presence of any Hazardous Material on the Premises caused
or permitted by Tenant results in any contamination of the Premises, Tenant
shall promptly take all actions at its sole expense as are necessary to return
the Premises to the condition existing prior to the introduction of any such
Hazardous Material to the Premises, provided that Landlord's approval of such
action shall first be obtained, which approval shall not be unreasonably
withheld so long as such actions would not potentially have any material adverse
long-term or short-term effect on the Premises or the Project.
5.4.2 TERMINATION OF LEASE. Notwithstanding the provisions of Paragraph
5.4.1 above, if (i) any anticipated use of the Premises by Tenant or any
proposed assignee or sublessee of Tenant involves generation, storage, use,
treatment or disposal of Hazardous Material, (ii) Tenant or the proposed
assignee or sublessee has been required by any prior landlord, lender or
governmental authority to take remedial action in connection with Hazardous
Material contaminating a property if the contamination resulted from such
party's action or use of the property in question, or (iii) Tenant or the
proposed assignee or sublessee is subject to an enforcement order issued by any
governmental authority in connection with the use, disposal or storage of a
Hazardous Material, Landlord shall have the right to terminate the Lease in
Landlord's sole and absolute discretion (with respect to any such matter
involving Tenant) and it shall not be unreasonable for Landlord to withhold its
consent to any proposed assignment or subletting (with respect to any such
matter involving a proposed assignee or sublessee).
5.4.3 TESTING. At any time prior to the expiration of the Sublease Term,
Landlord shall have the right to conduct appropriate tests of water and soil and
to deliver to Tenant the results of such tests to demonstrate that contamination
in excess of permissible levels has occurred as a result of Tenant's use of the
Premises. Tenant shall further be solely responsible for and shall defend,
indemnify and hold the Landlord, its agents and contractors harmless from and
against all claims, costs and liabilities including actual attorneys' fees and
costs, arising of or in connection with any removal, clean up, restoration and
materials required hereunder to return
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the Premises and any other property of whatever nature to their condition
existing prior to the appearance of the Hazardous Materials.
5.4.4 UNDERGROUND TANKS. If underground or other storage tanks storing
Hazardous Materials are located on the Premises or are hereafter placed on the
Premises by any party, Tenant shall monitor the storage tanks, maintain
appropriate records, implement reporting procedures, properly close any
underground storage tanks, and take or cause to be taken all other steps
necessary or required under the California Administrative Code, Title 23,
Chapter 3, Subchapter 16, "Underground Storage Tank Regulations," and Division
20, Chapter 6.7 of the California Health & Safety Code "Underground Storage of
Hazardous Substances," as they now exist or may hereafter be adopted or amended.
5.4.5 TENANT'S OBLIGATIONS. Tenant's obligations under this Paragraph 5.4
shall survive the termination of the Sublease. During any period of time
employed by Tenant after the Termination of this Sublease to complete the
removal from the Premises of any such Hazardous Materials, Lessee shall continue
to pay the full rental in accordance with this Sublease, which rental shall be
prorated daily.
5.4.6 DEFINITION OF "HAZARDOUS MATERIAL." As used herein, the term
"Hazardous Material" means any hazardous or toxic substance, material or waste
which is or becomes regulated by any local governmental authority, the State of
California or the United States Government. The term "Hazardous Material"
includes, without limitation, any material or substance which is (i) defined as
a "hazardous waste," "extremely hazardous waste" or "restricted hazardous waste"
under Sections 25115, 25117, 25122.7, or listed pursuant to Section 25140, of
the California Health and Safety Code, Division 20, Chapter 6.5 (Hazardous Waste
Control Law), (ii) defined as a "hazardous substance" under Section 25316 of the
California Health and Safety Code, Division 2, Chapter 6.8
(Carpenter-Presly-Tanner Hazardous Substance Account Act), (iii) defined as a
"hazardous material," "hazardous substance" or "hazardous waste" under Section
25501 of the California Health and Safety Code, Division 20, Chapter 6.95
(Hazardous Substances) (v) petroleum, (vi) asbestos, (vii) listed under Article
9 and defined as hazardous or extremely hazardous pursuant to Article 11 of
Title 22 of the California Administrative Code, Division 4, Chapter 20, (viii)
designated as a "hazardous substance" pursuant to Section 311 of the Federal
Water Pollution Control Act (33 U.S.C. Section 1317), (ix) defined as a
"hazardous waste'" pursuant to Section 1004 of the Federal Resource Conservation
and Recovery Act, 42 U.S.C. Section 6901 et. seq. (42 U.S.C. Section 6903), or
(x) defined as a "hazardous substance" pursuant to Section 101 of the
Comprehensive Environmental Response Compensation and Liability Act, 42 U.S.C.
Section 9601 et. seq. (42 U.S.C. Section 9601).
5.5 INDEMNIFICATION OF LANDLORD. Tenant shall indemnify Landlord and save it
harmless from and against any and all claims, actions, damages, liability and
expense in connection with loss of life , personal injury and/or damage to
property arising from or out of any occurrence in, upon or about the Premises,
or the occupancy or use by Tenant of the Premises or any part thereof, or
occasioned wholly or in part by any act of omission of Tenant, its agents,
contractors, employees, servants, tenants or concessionaires. Tenant shall
further indemnify and hold Landlord harmless from and against any and all claims
arising from any breach or default in performance of any obligation on Tenant's
part to be performed under the terms of this Sublease,
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or arising from any act, neglect, fault or omission of Tenant or its agents,
contractors, employees, servants, tenants or concessionaires, and from and
against all costs, attorneys' fees, expenses and liabilities incurred in
connection with such claim or any action or proceeding brought thereon. In case
any action or proceeding shall be brought against Landlord by reason of any such
claim, Tenant upon notice from Landlord shall defend the same at Tenant's
expense by counsel approved in writing by Landlord. Tenant, as a material part
of the consideration to Landlord hereby assumes all risk of damage to property
or injury to persons in, upon or about the Premises from any cause whatsoever
except (i) that which is caused by the failure of Landlord to observe any of the
terms and conditions of this Sublease where such failure has persisted for an
unreasonable period of time after written notice of such failure, and (ii)
Landlord's gross negligence or intentional misconduct. Tenant hereby waives all
its claims in respect thereof against Landlord.
5.6 LANDLORD'S ACCESS. Landlord or its agents may enter the Premises at all
reasonable times to show the Premises to potential buyers, investors or tenants
or other parties, or for any other purpose Landlord deems necessary. Landlord
shall give Tenant prior notice of such entry, except in the case of an
emergency. Landlord shall give Tenant prior notice of such entry, except in the
case of an emergency. Landlord may place customary "For Sale" or "For Sublease"
signs on the Premises.
5.7 QUIET POSSESSION. See "Quiet Possession and Nondisturbance" clause in the
Additional Provisions Sublease Rider.
5.8 WINDOW COVERING. Landlord shall select and install a standard window
covering for use throughout the Project, including all windows in the Premises.
ARTICLE VI
CONDITION OF PREMISES;
MAINTENANCE, REPAIRS AND ALTERATIONS
6.1 EXISTING CONDITIONS. Tenant accepts the Premises in its condition as of the
execution of the Sublease, subject to any other provisions of this Sublease and
to all recorded maters, laws, ordinances, and governmental regulations and
orders. Tenant acknowledge that neither Landlord nor any agent of Landlord has
made any representation as to the condition of the Premises or the suitability
of the Premises for Tenant's intended use.
6.2 EXEMPTION OF LANDLORD FROM LIABILITY; WAIVER. Landlord shall not be liable
for any damage or injury to the person, business (or any loss of income
therefrom), goods, wares, merchandise or other property of Tenant, Tenant's
employees, invitees, customers or any other person in or about the Premises,
whether such damage or injury is caused by or results from: (a) fire, steam,
electricity, water, gas or rain; (b) the breakage, leakage, obstruction or other
defects of pipes, sprinklers, wires, appliances, plumbing, air condition or
lighting fixtures or any other cause; (c) conditions arising in or about the
Premises or upon other portions of any building of which the Premises is a part,
or from other sources or places; or (d) any act or omission of any other tenant
of any building of which the Premises is a part. Landlord shall not be liable
for any such damage or injury even though the cause of or the means of repairing
such
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damage or injury are not accessible to Tenant. Tenant, as a material part
of the consideration to be rendered to Landlord, hereby waives all claims
against Landlord for the foregoing damages from any cause arising at any time.
The provisions of this Section 6.2 shall not, however, exempt Landlord from
liability for Landlord's gross negligence or willful misconduct.
6.3 TENANT'S OBLIGATIONS.
6.3.1 MAINTENANCE AND REPAIR. Tenant shall keep the Premises (including
all nonstructural, interior and exterior areas, systems and equipment, all
glass, glazing, window moldings, partitions, doors, door hardware, interior
painting, fixtures and appurtenances thereof [including electrical, lighting,
plumbing and plumbing fixtures]) in good order, condition and repair during the
Sublease Term. Tenant shall promptly replace any portion of the Premises or
system or equipment in the Premises which cannot be fully repaired regardless of
whether the benefit of such replacement extends beyond the Sublease Term. Tenant
shall also maintain a preventive maintenance contract providing for the regular
inspection and maintenance of the heating and air conditioning system (including
leaks around ducts, pipes, vents, or other pa of the air conditioning) by a
licensed heating and air conditioning contractor. However, Landlord shall have
the right, upon written notice to Tenant, to undertake the responsibility for
preventive maintenance of the heating and air conditioning system, at Tenant's
expense.* It is the intention of the Landlord and Tenant that, at all times
during the Sublease Term, Tenant shall maintain the Premises in an attractive,
first class and fully operative condition. *in the event Landlord determines
that Tenant is maintaining the HVAC system in an unsatisfactory manner.
6.3.2 TENANT EXPENSE. All of Tenant's obligations to maintain and repair
shall be accomplished at Tenant's sole expense. If Tenant refuses or neglects to
repair properly as required hereunder and to the reasonable satisfaction of
Landlord, Landlord may, on ten (10) days' prior notice (except that notice shall
be required in case of emergency) enter the property and perform such repair and
maintenance on behalf of Tenant without liability to Tenant for any loss or
damage that may accrue to Tenant's merchandise, fixtures, or other property or
to Tenant's business by reason thereof, and upon completion thereof, Tenant
shall pay Landlord's costs for making such repairs plus five percent (5%) for
overhead upon presentation of bill therefor, as additional rent. Said bill shall
include interest at ten percent (10%) on said costs from the date of completion
of repairs by Landlord.
6.4 LANDLORD'S OBLIGATIONS. Landlord shall be responsible for the maintenance
and repair of structural portions of the Premises. As used herein, structural
portions of the Premises shall only refer to the foundation and slabs, exterior
walls, and exterior roof of the building in which the Premises is located. If
Landlord is required to make repairs to structural portions by reason of
Tenant's conduct or activities, Landlord may add the cost of such repairs to the
rent which shall thereafter become due. If Tenant refuses or neglects to repair
property as required hereunder, and to the reasonable satisfaction of Landlord
as soon as reasonably possible after written demand, Landlord may make such
repairs without liability to Tenant for any loss or damage that may accrue to
Tenant's merchandise, fixtures or other property or to Tenant's business by
reason thereof, and upon completion thereof, Tenant shall pay Landlord as
additional rent Landlord's cost for making such repairs, plus five percent (5%)
for overhead upon presentation of bill thereafter. Said bill shall include
interest at ten percent (10%) per year on said costs from the date of completion
of repairs by Landlord. The Tenant shall pay its pro rata
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share, computed in accordance with Subsection 4.2.1 hereof, of all repairs by
Landlord to the structural portions of the building where the Premises are
located. All such amounts shall be due and payable upon five (5) days' written
notice from Landlord.
6.5 ALTERATIONS, ADDITIONS, AND IMPROVEMENTS.
6.5.1 PROHIBITED ACTIONS. Tenant shall not make any alterations, additions
or improvements to the Premises without Landlord's prior written consent, except
for non-structural alterations which do not exceed Five Thousand Dollars
($5,000) in cost cumulatively over the Sublease Term and which are not visible
from the outside of any building of which the Premises is part. Landlord may
require Tenant to provide demolition and/or lien and completion bonds in form
and amount satisfactory to Landlord. Tenant shall promptly remove any
alterations, additions, or improvements constructed in violation of this
Subsection 6.5.1 upon Landlord's written request. All alterations, additions,
and improvements will be accomplished in good and workmanlike manner, in
conformity with all applicable laws and regulations, and by a contractor
approved by Landlord. Upon completion of any such work, Tenant shall provide
Landlord with "as built" plans, copies of all construction contracts, and proof
of payment for all labor and materials. Any additions to, or alterations of, the
Premises, except moveable furniture and trade fixtures, shall become at once a
part of the Premises and belong to Landlord. However, this shall not prevent the
Tenant from installing trade fixtures, machinery or other trade equipment in
conformance to all applicable ordinances of the above-specified city and county,
and the same may be removed upon the termination of this Sublease, provided the
Premises is not damaged by such removal, and Tenant shall not then be in default
under the terms and conditions of this Sublease.
6.5.2 PAYMENT BY TENANT. Tenant shall pay when due all claims for labor
and material furnished to the Premises. Tenant shall give Landlord at least
thirty (30) days' prior written notice of the commencement of any work on the
Premises. Landlord may elect to record and post notices of nonresponsibility on
the Premises.
6.5.3 FREEDOM FROM LIENS. Tenant shall keep the Premises, all other
property therein and the Building free from any liens arising out of any work
performed, material furnished or obligations incurred by Tenant, and shall
indemnify, hold harmless and defend Landlord from any liens and encumbrances
arising out of any work performed or materials furnished by or at the direction
of Tenant. In the event that Tenant shall not, within twenty (20) days following
the imposition of any such lien, cause such lien to be released of record by
payment or posting of a proper bond, Landlord shall have, in addition to all
other remedies provided herein and by law, the right, but no obligation, to
cause the same to be released by such means as it shall deem proper, including
payment of the claim giving rise to such lien. All such sums paid by Landlord
and all expenses incurred by it in connection therewith, including attorneys'
fees and costs, shall be payable to Landlord by Tenant on demand with interest
at the maximum rate allowed by law.
6.5.4 WRITTEN NOTIFICATION REQUIRED. Tenant will notify Landlord in
writing thirty (30) days prior to commencing any alterations or additions to
allow Landlord time to file notices of nonresponsibility. The Landlord reserves
the right to approve any contractor and method of payment, prior to said
contractor making any improvements to the Premises.
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6.5.5 COMMON AREA CONSTRUCTION. Tenant acknowledges that from time to time
Landlord may be required to construct, alter, or improve Common Areas within the
Project. Landlord will attempt to minimize any disruption to Tenant's business,
but Tenant hereby releases Landlord from any and all claims pertaining to such
construction, alteration, or improvement not caused by Landlord's gross
negligence or willful misconduct.
6.6 RULES AND REGULATIONS.
6.6.1 The Tenant agrees as follows:
(1) Landlord shall arrange for a trash collection service which will
provide and periodically empty trash containers placed in designated areas for
use by Tenant and other tenants in the Project. Tenant shall be responsible for
placing all of its garbage and trash in such trash containers.
(2) No aerial shall be erected on the roof or exterior walls of the
Premises, or on the grounds, without in each instance, the written consent of
the Landlord. Any aerial so installed without such written consent shall be
subject to removal without notice at any time.
(3) No loudspeakers televisions, phonographs, radios, or other
devices shall be used in a manner so as to be heard or seen outside of the
Premises without the prior written consent of the Landlord.
(4) The outside areas immediately adjoining the Premises shall be
kept clean and free from dirt and rubbish by the Tenant to the satisfaction of
the Landlord and Tenant shall not place or permit any obstruction or materials
in such areas. No exterior storage shall be allowed without permission in
writing from Landlord.
(5) The plumbing facilities shall not be used for any other purpose
than that for which they are constructed, and no foreign substance of any kind
shall be thrown therein, and the expense of any breakage, stoppage, or damage
resulting from a violation of this provision shall be borne by Tenant who shall,
or whose employees, agents or invitees shall have caused it.
(6) Tenant shall not burn any trash or garbage of any kind in or
about the Premises, or the Project.
(7) The sidewalks, halls, passages, exits, entrances, and stairways
in and about the Project shall not be obstructed by any of the tenants or used
by them for any purpose other than for ingress to and egress from their
respective Premises. The halls, passages, exits, entrances, stairways, balconies
and roof are not for the use of the general public and the Landlord shall in all
cases retain the right to control and prevent access thereto by all persons
whose presence in the judgment of the Landlord shall be prejudicial to the
safety, character, reputation and interests of the Project and their Tenants,
provided that nothing herein contained shall be constructed to prevent such
access to persons with whom the Tenant normally deals in the ordinary course of
Tenant's business unless such persons are engaged in illegal activities. No
Tenant and no employees or invitees of any Tenant shall go upon the roof of the
building , except to maintain RVAC system per Paragraph 6.3.1.
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(8) No additional locks or bolts of any kind shall be placed
upon doors or windows by Tenant, nor shall any changes be made in existing locks
or the mechanisms thereof. Tenant must, upon the termination of Tenant's
tenancy, restore to Landlord all keys of stores, offices and toilet rooms either
furnished to or otherwise procured by Tenant, and in the event of the loss of
any keys so furnished Tenant shall pay to Landlord the cost thereof.
(9) No Tenant shall lay linoleum or other similar floor
covering so that the same shall be affixed to the floor of the Premises in any
manner except by a paste, or other material, which may easily be removed with
water, the use of cement or other similar adhesive materials being expressly
prohibited. The method of affixing any such linoleum or other similar floor
covering to the floor, as well as the method of affixing carpets or rugs to the
Premises, shall be subject to approval by Landlord. The expense of repairing any
damage resulting from a violation of this rule shall be borne by Tenant by whom,
or by whose agents, clerks, employees, or visitors, the damage shall have been
caused.
(10) Tenant will not install blinds, shades, awnings, or other
form of inside or outside window covering, or window ventilators or similar
devices, without the prior written consent of Landlord.
Landlord reserves the right from time to time to amend or supplement the
foregoing rules and regulations, and to adopt and promulgate additional rules
and regulations applicable to the Premises. Notice of such rules and regulations
and amendments and supplements thereto, if any, shall be given to the Tenant and
Tenant agrees to comply with all such rules and regulations upon receipt of
notice to Tenant from Landlord. Landlord shall not be liable in any way to
Tenant for any damage or inconvenience caused by any other Tenant's
non-compliance with these rules and regulations.
6.7 CONDITION UPON TERMINATION. Upon the termination of the Sublease,
Tenant shall surrender the Premises to Landlord, broom-clean and in the same
condition as received except for ordinary wear and tear which Tenant was not
otherwise obligated to remedy under any provision of this Sublease. However,
Tenant shall not be obligated to repair any damage which Landlord is required to
repair under Article Seven (Damage or Destruction). In addition, Landlord may
require Tenant to remove any alterations, additions or improvements (whether or
not made with Landlord's consent) prior to the termination of the Sublease and
to restore the Premises to its prior condition, all at Tenant's expense. All
alterations, additions and improvements which Landlord has not required Tenant
to remove shall become Landlord's property and shall be surrendered to Landlord
upon the termination of the Sublease, except that Tenant may remove any of
Tenant's machinery or equipment which can be removed without material damage to
the Premises. Tenant shall repair, at Tenant's expense, any damage to the
Premises caused by the removal of any such machinery or equipment. In no event,
however, shall Tenant remove any of the following materials or equipment without
Landlord's prior written consent: any power wiring or power panels; lighting or
lighting fixtures; wall coverings; drapes, blinds or other window coverings;
carpets or other floor coverings; heaters, air conditioners or any other heating
or air conditioning equipment; fencing or security gates; or other similar
building operating equipment and decorations.
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6.8 MAINTENANCE OF COMMON AREAS. Landlord shall maintain the Common Areas as set
forth in Section 4.5 above.
ARTICLE VII
DAMAGE OR DESTRUCTION
7.1 PARTIAL DAMAGE TO PREMISES. Tenant shall notify Landlord in writing
immediately upon the occurrence of any damage to the Premises or the Building.
If the Premises or the Building is only partially damaged and if the proceeds
received by Landlord from the insurance policies described in Subsection 4.4.2
are sufficient to pay for the necessary repairs, this Sublease shall remain in
effect and Landlord shall repair the damage as soon as reasonably possible.
Landlord may elect to repair any damage to Tenant's fixtures, equipment, or
improvements. If the insurance proceeds received by Landlord are not sufficient
to pay the entire cost of repair, or if the cause of the damage is not covered
by the insurance policies which Landlord maintains under Subsection 4.4.2,
Landlord may elect either to (a) repair the damage as soon as reasonably
possible, in which case this Sublease shall remain in full force and effect or
(b) terminate this Sublease as of the date the damage occurred. Landlord shall
notify Tenant within thirty (30) days after receipt of notice of the occurrence
of the damage, whether Landlord elects to repair the damage or terminate the
Sublease. If Landlord elects to repair the damage, Tenant shall pay Landlord the
"deductible amount" (if any) under Landlord's insurance policies or the Tenant's
pro rata share thereof if the Premises is a multi-tenant building, and, if the
damage was due to an act or omission of Tenant, the difference between the
actual cost of repair and any insurance proceeds received by Landlord. If
Landlord elects to terminate this Sublease, Tenant may elect to continue this
Sublease in full force and effect, in which case Tenant shall repair any damage
to the Premises and any building in which the Premises is located. Tenant shall
pay the cost of such repairs, except that, upon satisfactory completion of such
repairs, Landlord shall deliver to Tenant any insurance proceeds received by
Landlord for the damage repaired by Tenant. Tenant shall give Landlord written
notice of such election within ten (10) days after receiving Landlord's
termination notice. If the damage to the Premises occurs during the last six (6)
months of the Sublease Term, Landlord may elect to terminate this Sublease as of
the date the damage occurred, regardless of the sufficiency of any insurance
proceeds and Landlord may retain all such proceeds. In such event, Landlord
shall not be obligated to repair or restore the Premises and Tenant shall have
no right to continue this Sublease. Landlord shall notify Tenant of its election
within thirty (30) days after receipt of notice of the occurrence of the damage.
7.2 TOTAL OR SUBSTANTIAL DESTRUCTION. If the Premises is totally or
substantially destroyed by any cause whatsoever, or if the Premises is in a
building which is substantially destroyed (even though the Premises is not
totally or substantially destroyed), this Sublease shall, at the election of the
Landlord, terminate as of the date the destruction occurred regardless of
whether Landlord receives any insurance proceeds. However, if the Premises can
be rebuilt within one (1) year after the date of destruction, Landlord may elect
to rebuild the Premises at Landlord's own expense (with all insurance proceeds
being made available to the Landlord to apply against such costs), in which
case, this Sublease shall remain in full force and effect. Landlord shall notify
Tenant of such election within thirty (30) days after the occurrence
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of total or substantial destruction. If the destruction was caused by an act or
omission of Tenant, Tenant shall pay Landlord the difference between the actual
cost of rebuilding and any insurance proceeds received by Landlord.
7.3 UNINSURED CASUALTY. In the event the Premises are destroyed to the extent of
fifteen percent (15%) or more of the replacement value thereof by any casualty
not covered under the fire and extended coverage insurance covered by Landlord
or Tenant, then Landlord may elect to terminate this Sublease. In the event of
such termination the rights and obligations of the parties hereunder shall
cease. If the Landlord does not elect to so terminate, then the Landlord shall
promptly commence repairing such damage at the Landlord's cost and expense.
7.4 LANDLORD'S OBLIGATIONS. Landlord shall not be required to repair any injury
or damage by fire or other cause, or to make any restoration or replacement of
any panelings, decorations, partitions, railings, floor coverings, office
fixtures or any other improvements or property installed in the Premises by
Tenant or at the direct or indirect expense of Tenant which are not part of the
original Tenant improvements paid for by Landlord. Tenant shall be required to
restore or replace same in the event of damage except for damage caused solely
by the Landlord's negligence or intentional misconduct. Tenant shall have no
claim against Landlord for any damage suffered by reason of any such damage,
destruction, repair or restoration, nor shall Tenant have the right to terminate
this Sublease as the result of any statutory provision now or hereafter in
effect pertaining to the damage and destruction of the Premises, except as
expressly provided herein.
7.5 TEMPORARY REDUCTION IN RENT. If the Premises are destroyed or damaged and
Landlord or Tenant repairs or restores the Premises pursuant to the provisions
of this Article Seven, any rent payable during the period of such damage, repair
and/or restoration shall be reduced by the amount payable under any rental
income insurance paid to Landlord. Except for such possible reduction in
payments required from the Tenant, Tenant shall not be entitled to any
compensation, reduction, or reimbursement from Landlord as a result of any
damage, destruction, repair, or restoration of or to the Premises.
7.6 WAIVER. Tenant waives the protection of any statute, code or judicial
decision which grants a tenant the right to terminate a sublease in the event of
damage or destruction of the premises. Tenant agrees that the provisions of this
Article Seven shall govern the rights and obligations of Landlord and Tenant in
the event of any damage or destruction of the Premises.
ARTICLE VIII
CONDEMNATION
8.1 CONDEMNATION. If all or any portion of the Premises is taken under the power
of eminent domain or sold under the threat of that power (all of which are
called "Condemnation"), this Sublease shall terminate as to the part taken or
sold on the date the condemning authority takes title or possession whichever
occurs first. If more than twenty percent (20%) of the floor area of the
Premises is taken, either Landlord or Tenant may terminate this Sublease as of
the date the condemning authority take title or possession, by delivering
written notice to the other within ten (10) days after receipt of written notice
of such taking (or in the absence of such
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notice, within ten (10) days after the condemning authority takes possession).
If more than twenty percent (20%) of all subleaseable space in the building in
which the Premises are located is taken the Landlord may elect to terminate this
Sublease by delivering such notice to Tenant. If neither Landlord nor Tenant
terminates this Sublease, this Sublease shall remain in effect as to the portion
of the Premises not taken, except that the Base Rent shall be reduced in
proportion to the reduction in the floor area of the Premises. Any Condemnation
award or payment shall be distributed in the following order: (a) first, to any
ground lessor, mortgagee or beneficiary under a deed of trust encumbering the
Premises, the amount of its interest in the Premises and the Tenant hereby
assigns any other rights which the Tenant may have now or in the future to any
other award to the Landlord; (b) second, to Tenant, only the amount of any award
specifically designated for loss of or damage to Tenant's trade fixtures or
removable personal property, and the Tenant hereby assigns any other rights
which the Tenant may have now or in the future to any other award to the
Landlord, and (c) third, to Landlord, the remainder of such award, whether as
compensation for reduction in the value of the subleasehold, the taking of the
fee, or otherwise. If this Sublease is not terminated, Landlord shall repair any
damage to the Premises caused by the Condemnation, except that Landlord shall
not be obligated to repair any damage for which Tenant has been reimbursed by
the condemning authority. If the severance damages received by Landlord are not
sufficient to pay for such repair, Landlord shall have the right to either
terminate this Sublease or make such repair at Landlord's expense.
ARTICLE IX
ASSIGNMENT AND SUBLETTING
9.1 LANDLORD'S CONSENT REQUIRED. No portion of the Premises or of Tenant's
interest in this Sublease may be acquired by any other person or entity, whether
by assignment, mortgage, sublease, transfer, operation of law, or act of Tenant,
without Landlord's prior written consent, except as provided in Section 9.2
below. Any attempted transfer without consent shall be void and shall constitute
a noncurable breach of this Sublease. If tenant is a partnership, (i) any
cumulative transfer or more than twenty percent (20%) of the partnership
interests, or (ii) the admission of a new general partner, or (iii) the transfer
of any interest of any general partner in the partnership shall require
Landlord's consent.
9.2 TENANT AFFILIATE. Tenant may assign this Sublease or sublease the Premises,
without Landlord's consent, to any corporation which controls, is controlled by
or is under common control with Tenant, or to any corporation resulting from the
merger of or consolidation with Tenant ("Tenant's Affiliate"). In such case, any
Tenant's Affiliate shall assume in writing all of Tenant's obligations under
this Sublease, but the Tenant shall remain primarily liable hereunder.
9.3 NO RELEASE OF TENANT. No transfer permitted by this Article Nine, whether
with or without Landlord's consent, shall release Tenant or change Tenant's
primary liability to pay the rent and to perform all other obligations of Tenant
under this Sublease. Landlord's acceptance of rent from any other person is not
a waiver of any provision of this Article Nine. Consent to one transfer is not a
consent to any subsequent transfer. If Tenant's transferee defaults under this
Sublease, Landlord may proceed directly against Tenant without pursuing remedies
against the transferee. Landlord may consent to subsequent assignments or
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modifications of this Sublease by Tenant's transferee, without notifying Tenant
or obtaining its consent. Such action shall not relieve Tenant's liability under
this Sublease.
9.4 LANDLORD'S ELECTION Tenant's request for consent to any transfer described
in Section 9.1 above shall be accompanied by a written statement setting forth
the details of the proposed transfer, including the name, business and financial
condition of the prospective transferee, financial details of the proposed
transfer (e.g., the term of and rent and security deposit payable under any
assignment or sublease), and any other information Landlord deems relevant.
Landlord shall have the right (a) to withhold consent, if reasonable; (b) to
grant consent; or (c) if the transfer is a sublease of the Premises or an
assignment of this Sublease, to terminate this Sublease as of the effective date
of such sublease or assignment, in which case Landlord may elect to enter into a
direct sublease with the proposed assignee or subtenant.
9.5 NO MERGER. No merger shall result from Tenant's sublease of the Premises
under this Article Nine, Tenant's surrender of this Sublease or the termination
of this Sublease in any other manner. In any such event, Landlord may terminate
any or all subtenancies or succeed to the interest of Tenant as sublandlord
thereunder.
ARTICLE X
DEFAULTS; REMEDIES
10.1 COVENANTS AND CONDITIONS. Tenant's performance of each of Tenant's
obligations under this Sublease is a condition as well as a covenant. Tenant's
right to continue in possession of the Premises is conditioned upon such
performance. Time is of the essence in the performance of all covenants and
conditions
10.2 DEFAULTS. Tenant shall be in material default under this Sublease:
10.2.1 VACATION OR ABANDONMENT. If Tenant abandons or vacates the Premises
or if such abandonment or vacation of the Premises results in the cancellation
of any insurance described in Section 4.4; or
10.2.2 FAILURE TO PAY. If Tenant fails to pay rent or any other charge
required to be paid to Tenant, as and when due; or
10.2.3 FAILURE TO PERFORM. If Tenant fails to perform any of Tenant's
nonmonetary obligations under this Sublease for a period of fifteen (15) days
after written notice from Landlord; provided that if more time is required to
complete such performance, Tenant shall not be in default if Tenant commence
such performance within the fifteen (15) day period and thereafter diligently
pursues its completion. However, Landlord shall not be required to give such
notice if Tenant's failure to perform constitute a non-curable breach of this
Sublease. The notice required by this Subsection is intended to satisfy any and
all notice requirements imposed by law on Landlord and is not in addition to any
such requirement.
10.2.4 OTHER DEFAULTS. (i) If Tenant makes a general assignment or general
arrangement for the benefit of creditors; (ii) If a petition for adjudication of
bankruptcy or for
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reorganization or rearrangement is filed by or against Tenant and is not
dismissed within thirty (30) days; (iii) if a trustee or receiver is appointed
to take possession of substantially all of Tenant's assets located at the
Premises or of Tenant's interest in this Sublease and possession is not restored
to Tenant within thirty (30) days; or (iv) if substantially all of Tenant's
assets located at the Premises or of Tenant's interest in this Sublease is
subjected to attachment, execution or other judicial seizure which is not
discharged within thirty (30) days. If a court of competent jurisdiction
determines that any of the acts described in this Subsection 10.2.4 is not
default under this Sublease, and a trustee is appointed to take possession (or
if Tenant remains a debtor in possession) and such trustee or Tenant transfers
Tenant's interest hereunder, then Landlord shall receive as Additional Rent, the
difference between the rent (or any other consideration) paid in connection with
such assignment or sublease and the rent payable by Tenant hereunder.
10.3 REMEDIES. On the occurrence of any material default by Tenant, Landlord
may, at any time thereafter, with or without notice or demand and without
limiting Landlord in the exercise of any right or remedy which Landlord may
have:
10.3.1 TERMINATION OF POSSESSION. Terminate Tenant's right to possession
of the Premise by any lawful means, in which case this Sublease shall terminate
and Tenant shall immediately surrender possession of the Premises to Landlord.
In such event Landlord shall have the immediate right to re-enter and remove all
persons and property and such property may be removed and stored in a public
warehouse or elsewhere at the cost of, and for the account of Tenant, all
without service of notice of resort to legal process and without being deemed
guilty of trespass, or becoming liable for any loss or damage which may be
occasioned thereby; and Landlord shall be entitled to recover from Tenant all
damages incurred by Landlord by reason of Tenant's default, including (i) the
worth at the time of the award of all Base Rent, Additional Rent and other
charges which were earned or were payable at the time of the termination; (ii)
the worth at the time of the award of the amount by which the unpaid Base Rent,
Additional Rent and other charges which would have been earned or were payable
after termination until the time of the award exceeds the amount of such rental
loss that Tenant proves could have been reasonably avoided, (iii) the worth at
the time of the award of the amount by which the unpaid Base Rent, Additional
Rent and other charges which would have been payable for the balance of the term
after the time of award exceeds the amount of such rental loss that Tenant
proves could have been reasonably avoided; and (iv) any other amount necessary
to compensate Landlord for all the detriment proximately caused by Tenant's
failure to perform its obligations under the Sublease or which in the ordinary
course of things would be likely to result therefrom, including, but not limited
to, any cost or expenses incurred by Landlord in maintaining or preserving the
Premises after such default, the cost of recovering possession of the Premises,
expenses of reletting, including necessary renovation or alteration of the
Premises, Landlord's reasonable attorneys fees incurred in connection therewith,
and any real estate commissions or other such fees paid or payable. As used in
subparts (i) and (ii) above, the "worth at the time of the award" is computed by
allowing interest on unpaid amounts at the rate of fifteen percent (15%) per
annum, or such lesser amount as may then be the maximum lawful rate. As used in
subpart (iii) above, the "worth at the time of the award" is computed by
discounting such amount at the discount rate of the Federal Reserve Bank of San
Francisco at the time of the award, plus one percent (1%). If Tenant shall have
abandoned the Premises, Landlord shall have the option of (i)
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retaking possession of the Premises and recovering from Tenant the amount
specified in this Subsection 10.3.1 or (ii) proceeding under Subsection 10.3.2.
10.3.2 MAINTENANCE OF POSSESSION. Maintain Tenant's right to possession,
in which case this Sublease shall continue in effect whether or not Tenant shall
have abandoned the Premises. In such event, Landlord shall be entitled to
enforce all of Landlord's rights and remedies under this Sublease including the
right to recover the rent as it becomes due hereunder.
10.3.3 OTHER REMEDIES. Pursue any other remedy now or thereafter available
to Landlord under the laws or judicial decisions of the state in which the
Premises is located.
10.4 THE RIGHT TO RELET THE PREMISES. Should Landlord elect to re-enter, as
herein provided, or should it take possession pursuant to legal proceedings or
pursuant to any notice provided for by law, it may either terminate this
Sublease or it may from time to time without terminating this Sublease, make
such alterations and repairs as may be necessary in order to relet the property,
and relet said property or any part thereof for such term or terms (which may be
for a term extending beyond the term of this Sublease) and at such rental or
rentals and upon such other terms and conditions as Landlord in its sole
discretion may deem advisable upon each such reletting all rentals received by
the Landlord from such reletting shall be applied, first to the repayment of any
indebtedness other than rent due hereunder from Tenant to Landlord; second, to
the payment of any costs and expenses of such reletting, including brokerage
fees and attorneys' fees and of costs of such alterations and repairs; third, to
the payment of rent due and unpaid hereunder, and the residue, if any, shall be
held by Landlord and applied in payment of future rent as the same may become
due and payable hereunder. If such rentals received from such reletting during
any month are less than that to be paid during that month by Tenant hereunder,
Tenant shall pay any such deficiency to Landlord. Such deficiency shall be
calculated and paid monthly. No such re-entry or taking possession of said
property by Landlord shall be construed as an election on its part to terminate
this Sublease unless a written notice of such intention be given to Tenant or
unless the termination thereof be decree by a court of competent jurisdiction.
10.5 WAIVER OF RIGHTS OF REDEMPTION. Tenant hereby expressly waives any and all
rights of redemption granted by or under any present or future laws in the event
of Tenant being evicted or dispossessed for any cause, or in the event of
Landlord obtaining possession of the Premises, by reason of the violation by
Tenant of any of the covenants or conditions of this Sublease, or otherwise.
10.6 CUMULATIVE REMEDIES. Landlord's exercise of any right or remedy shall not
prevent it from exercising any other right or remedy.
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ARTICLE XI
PROTECTION OF CREDITORS
11.1 SUBORDINATION
11.1.1 LANDLORD'S ELECTION. This Sublease is and shall remain subordinate
to the Master Lease. In addition, Landlord shall have the right to require
Tenant to subordinate this Sublease to any other ground lease, deed of trust or
mortgage encumbering the Premises, any advances made on the security thereof and
any renewals, modifications, consolidations, replacements or extensions thereof
whenever made or recorded. However, Tenant's right to quiet possession of the
Premises during the Sublease Term shall not be disturbed if Tenant pays the rent
and performs all of Tenant's obligations under this Sublease and is not
otherwise in default. If any ground lessor, beneficiary or mortgagee elects to
have this Sublease prior to the lien of its ground sublease, deed of trust or
mortgage and gives written notice thereof to Tenant, this Sublease shall be
deemed prior to such ground sublease, deed of trust or mortgage whether this
Sublease is dated prior or subsequent to the date of said ground sublease, deed
of trust or mortgage or the date of recording thereof.
11.1.2 ADDITIONAL DOCUMENTS. Tenant agrees to execute any documents
required to effectuate such subordination or to make this sublease prior to the
lien of any ground sublease, mortgage or deed of trust, as the case may be, and
failing to do so within ten (10) days after written demand does hereby make,
constitute and irrevocably appoint Landlord as Tenant's attorney-in-fact and in
Tenant's name, place and stead, to do so.
11.2 ATTORNMENT. If Landlord's interest in the Premises is acquired by any
ground lessor, beneficiary, under a deed of trust, mortgagee, or purchaser at a
foreclosure sale, Tenant shall attorn to the transferee of or successor to
Landlord's interest in the Premises and recognize such transferee or successor
as Landlord under this Sublease. Tenant waives the protection of any statute or
rule of law which gives or purports to give Tenant any right to terminate this
Sublease or surrender possession of the Premises upon the transfer of Landlord's
interest.
11.3 SIGNING OF DOCUMENTS. Tenant shall sign and deliver any instrument or
documents necessary or appropriate to evidence any such attornment or
subordination or agreement to do so. If Tenant fails to do so within (10) days
after written request, Tenant hereby makes, constitutes and irrevocably appoints
Landlord, or any transferee or successor of Landlord, the attorney-in-fact of
Tenant to execute and deliver any such instrument or document.
11.4 ESTOPPEL CERTIFICATES.
11.4.1 LANDLORD'S REQUEST. Upon Landlord's written request, Tenant shall
execute. acknowledge and deliver to Landlord a written statement certifying: (1)
that none of the terms or provisions; of this Sublease have been changed (or if
they have been changed, stating how they have been changed); (ii) that this
Sublease has not been cancelled or terminated; (iii) the last date of payment of
the Base Rent and other charges and the time period covered by such payment; and
(iv) that Landlord is not in default under this sublease (or, if the Landlord is
claimed to be in default, stating why). Tenant shall deliver such statement to
Landlord within ten (10) days after Landlord's request. Any such statement by
Tenant may be given by Landlord to
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any prospective purchaser or encumbrancer of the Premises. Such purchaser or
encumbrancer may rely conclusively upon such statement as true and correct.
11.4.2 FAILURE TO DELIVER. If Tenant does not deliver such statement to
Landlord within such ten (10) day period, Landlord, and any prospective
purchaser or encumbrancer, may conclusively presume and rely upon the following
facts except as otherwise represented: (i) that the terms and provisions of this
Sublease have not been changed resented by Landlord; (ii) that this Sublease has
not been cancelled or terminated except as otherwise represented by Landlord;
(iii) that not more than one month's Base Rent or other charges have been paid
in advance; and (iv) that Landlord is not in default under the Sublease. In such
event, Tenant shall be estopped from denying the truth of such facts.
11.5 TENANT'S FINANCIAL CONDITION. Within ten (10) days after written request
from Landlord, Tenant shall deliver to Landlord such financial statements as are
reasonably required by Landlord to verify the net worth of Tenant, or any
assignee, subtenant, or guarantor of Tenant. In addition, Tenant shall deliver
to any lender or proposed purchaser of the Premises designated by Landlord any
financial statements required by such lender to facilitate the sale, financing
or refinancing of the Premises. Tenant represents and warrants to Landlord that
(a) each such financial statement is a true and accurate statement as of the
date of such statement and (b) at all times after the date of any such statement
during the Sublease Term or any extension thereof, Tenant's net worth, as stated
therein, shall not be reduced. All financial statements shall be confidential
and shall be used only for the purposes set forth herein.
ARTICLE XII
LEGAL COSTS
12.1 LEGAL PROCEEDINGS. Tenant or Landlord shall reimburse the other party, upon
demand, for any costs or expense incurred by the other party in connection with
any breach or default of Tenant or Landlord under this Sublease, whether or not
suit is commenced or judgment entered. Such costs shall include legal fees and
costs incurred for the negotiation of a settlement, enforcement of rights or
otherwise. Furthermore, if any action for breach of or to enforce the provisions
of this Sublease is commenced, the court in such action shall award to the party
in whose favor a judgment is entered a reasonable sum as attorneys' fees and
costs. Such attorneys' fees and costs shall be paid by the losing party in such
action. Tenant shall also indemnify Landlord against and hold Landlord harmless
from all costs, expenses, demands and liability incurred by Landlord if Landlord
becomes or is made a party to any claim or action (a) instituted by Tenant or by
any third party against Tenant, or by or against any person holding any interest
or using the Premises by license of or agreement with Tenant; (b) for
foreclosure of any lien for labor or material furnished to or for Tenant or such
other person; (c) otherwise arising out of or resulting from any act or
transaction of Tenant or such other person; or (d) necessary to protect
Landlord's interest under this Sublease in a bankruptcy proceeding, or other
proceeding under Title 11 of the United States Code, as amended. Tenant shall
defend Landlord against any such claim or action at Tenant's expense with
counsel reasonably acceptable to Landlord or, at Landlord's election, Tenant
shall reimburse Landlord for any legal fee or costs incurred by Landlord in any
such claim or action.
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12.2 LANDLORD'S CONSENT. Tenant shall pay Landlord's reasonable attorneys' fees
incurred in connection with Tenant's request for Landlord's consent under
Article Nine (Assignment and Subletting) or in connection with any other act
which Tenant proposes to do and which requires Landlord's consent, provided,
however, such attorney's fees shall not exceed $2,500.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
13.2 LANDLORD'S LIABILITY; CERTAIN DUTIES.
13.2.1 LANDLORD. As used in this Sublease, the term "Landlord" means only
the current owner or owners of the leasehold estate under the Master Lease at
the time in question. Each Landlord has obligated to perform the obligations of
Landlord under this Sublease only during the time such Landlord owns such
interest or title. Any Landlord who transfers its title or interest is relieved
of all liability with respect to the obligations of Landlord under this Sublease
to be performed on or after the date of transfer. However, each Landlord shall
deliver to its transferee all funds previously paid by Tenant, if such funds
have not yet been applied under the terms of this Sublease.
13.2.2 WRITTEN NOTICE. Tenant shall give written notice of any failure by
Landlord to perform any of its obligations under this Sublease to Landlord and
to the District, any ground lessor, mortgagee or beneficiary under any deed of
trust encumbering the Premises whose name and address have been furnished to
Tenant in writing. Landlord shall not be in default under this Sublease unless
Landlord (or the District, or such ground lessor, mortgagee or beneficiary)
fails to cure such non-performance within thirty (30) days after receipt of
Tenant's notice. However, if such non-performance reasonably requires more than
thirty (30) days to cure, Landlord shall not be in default if such cure is
commenced within such thirty (30) day period and thereafter diligently pursued
to completion.
13.3 SEVERABILITY. A determination by a court of competent jurisdiction that any
provision of this Sublease or any part thereof is illegal or unenforceable shall
not cancel or invalidate the remainder of such provision or this Sublease, which
shall remain in full force and effect.
13.4 INTERPRETATION. The captions of the Articles or Sections of this Sublease
are to assist the parties in reading this Sublease and are not a part of the
terms or provisions of this Sublease. Whenever required by the context of this
Sublease, the singular shall include the plural and the plural shall include the
singular. The masculine, feminine and neuter genders shall each include the
other. In any provision relating to the conduct, acts or omissions of tenant,
the term "Tenant" shall include Tenant's agents, employees, contractors,
invitees, successors or others using the Premises with Tenant's expressed or
implied permission.
13.5 INCORPORATION OF PRIOR AGREEMENTS; MODIFICATIONS. This Sublease is the only
agreement between the parties pertaining to the sublease of the Premises and
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no other agreements are effective. All amendments to this Sublease shall be in
writing and signed by all parities. Any other attempt at amendment shall be
void.
13.6 NOTICES. All notices required or permitted under this Sublease shall be in
writing and shall be personally delivered or sent by certified mail, return
receipt requested, postage prepaid. Notices to Tenant shall be delivered to the
address specified in Section 1.3 above, except that upon Tenant's taking
possession of the Premises, the Premises shall be Tenant's address for notice
purposes. Notice to Landlord shall be delivered to the address specified in
Section 1.2 above. All notices shall be effective upon personal delivery or
three (3) days after deposit in the U.S. Mail. Either party may change its
notice address upon written notice to the other party.
13.7 WAIVERS. All waivers must be in writing and signed by the waiving party.
Landlord's failure to enforce any provision of this Sublease or its acceptance
of rent shall not be a waiver and shall not prevent Landlord from enforcing that
provision or any other provision of this Sublease in the future. No statement on
a payment check from Tenant or in a letter accompanying a payment check shall be
binding on Landlord. Landlord may with or without notice to Tenant, negotiate
such check without being bound to the conditions of such statement.
13.8 NO RECORDATION. Tenant shall not record this Sublease without prior written
consent from Landlord. However, Landlord may require that a "Short Form"
memorandum of this Sublease be executed by both parties and recorded.
13.9 BINDING EFFECT; CHOICE OF LAW. This Sublease binds any party who legally
acquires any rights or interest in this Sublease from Landlord or Tenant.
However, Landlord shall have no obligation to Tenant's successor unless the
rights or interests of Tenant's successor are acquired in accordance with the
terms of this Sublease. The laws of the state in which the Premises are located
shall govern this Sublease.
13.10 CORPORATE AUTHORITY; PARTNERSHIP AUTHORITY. If Tenant is a corporation
each person signing this Sublease on behalf of Tenant represents and warrants
that he has full authority to do so and that this Sublease binds the
corporation. Within five (5) days after this Sublease is signed, Tenant shall
deliver to Landlord a certified copy of a resolution of Tenant's Board of
Directors authorizing the execution of this Sublease or other evidence of such
authority reasonably acceptable to Landlord. Tenant is a partnership, each
person signing this Sublease for Tenant represents and warrants that he is a
general partner of the partnership, that he has full authority to sign for the
partnership and that this Sublease binds the partnership and all general
partners of the partnership. Tenant shall give written notice to Landlord of any
general partner's withdrawal or addition. Within five (5) days after this
Sublease is signed, Tenant shall deliver to Landlord a copy of Tenant's recorded
statement of partnership or certificate of limited partnership.
13.11 JOINT AND SEVERAL LIABILITY. All parties signing this Sublease as Tenant
shall be jointly and severally liable for all obligations of Tenant.
13.12 FORCE MAJEURE. If Landlord cannot perform any of its obligations due to
events beyond Landlord's control, the time provided for performing such
obligations shall be extended
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by a period of time equal to the duration of such events. Events beyond
Landlord's control include, but are not limited to, acts of God, war, civil
commotion, labor disputes, strikes, fire, flood or other casualty, shortage of
labor or material, government regulation or restriction and weather conditions.
13.13 NO OPTION. The submission of this Sublease for examination does not
constitute a reservation of or option to sublease the Premises and this Sublease
becomes effective only upon execution and delivery thereof by Landlord and
Tenant.
LANDLORD:
GAP PORTFOLIO PARTNERS,
a New York general partnership
By: Colony Advisors, Inc.
its authorized agent
By: /s/ Thomas F. Harrison
Name: Thomas F. Harrison
-------------------
Signed on April 26, 1993 Title: Senior Vice President
---------------------
at San Diego, California
TENANT:
Camino Laboratories, a Delaware corporation
By: /s/ Hazel Marie Allen /s/ Jack Rinds
Its: Vice President Controller
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ADDITIONAL PROVISIONS
SUBLEASE RIDER
This Additional Provisions Sublease Ride ("Rider") is attached to and made a
part of that certain Industrial Real Estate Triple Net Sublease dated April 1,
1993, between GAP Portfolio Partners, a New York General Partnership, as
Landlord, and Camino Laboratories, a Delaware corporation as Tenant, covering
the Premises commonly known as 5955 Pacific Center Boulevard, Sand Diego,
California (the "Sublease"). The terms used in this Rider shall have the same
definitions as set forth in the Sublease and the other riders attached to and a
part of the Sublease. The provisions of this Rider shall supersede any
inconsistent or conflicting provisions of the Sublease, including the other
riders attached to and a part of the Sublease.
1. The Additional Rent charges per Paragraph 1.9.2 shall not exceed the
dollar amounts delineated below:
Calendar Year Amounts per square foot per month
------------- ---------------------------------
1993 $.181
1994 .186
1995 .192
1996 .198
1997 .204
1998 .210
1999 .216
2000 .222
2001 .229
2002 .236
2003 .243
2. Quiet Possession and Nondisturbance: If Tenant pays the rent and complies
with all other terms of this Sublease, Tenant may occupy and enjoy the
Premises for the full Sublease term. In the event of a foreclosure sale or
conveyance in lieu of such foreclosure, so long as there shall not then
exist any breach or default on the part of the Tenant under this Sublease,
or any event or condition which, with the giving of notice and/or the
passage of time, could become such a breach or default, or any other event
that would permit the Tenant's leasehold interest under this Sublease to
be terminated, and subject to compliance by the Tenant with the terms
hereof, (a) the Tenant's right to possession of the leased Premises and
leasehold interest under this Sublease shall not be disturbed and shall
continue in effect, and (b) the purchaser or transferee shall recognize
and accept the Tenant as tenant under the terms, requirements and
provisions of this Sublease.
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TENANT IMPROVEMENT
SUBLEASE RIDER
This Tenant Improvement Sublease Rider ("Rider") is attached to and made a part
of that certain Industrial Real Estate Triple Net Sublease dated April 1, 1993,
between GAP Portfolio Partners, a New York General Partnership, as Landlord, and
Camino Laboratories, a Delaware corporation as Tenant, covering the Premises
commonly known as 5955 Pacific Center Boulevard, San Diego, CA 92121 (the
"Sublease"). The terms used in this Rider shall have the same definitions as set
forth in the Sublease. The provisions of this Rider shall supersede any
inconsistent or conflicting provisions of the Sublease.
1. LANDLORD'S OBLIGATION.
1.1 Landlord shall be responsible for painting interior office walls;
cleaning or replacing all carpeting at direction of Tenant; trimming trees in
front of building to make "Camino Labs" sign visible; adding wall in old
instrument area; and, installing new sinks in RI and QA labs.
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OPTION TO EXTEND TERM
SUBLEASE RIDER
This Option to Extend Term Sublease Rider ("Rider") is attached to and made a
part of that certain Industrial Real Estate Triple Net Sublease dated April 1,
1993, between GAP Portfolio Partners, a New York General Partnership, as
Landlord, and Camino Laboratories, a Delaware corporation, as Tenant, covering
the Premises commonly known as 5955 Pacific Center Boulevard, San Diego, CA
92121 (the "Sublease"). The terms used in this Rider shall have the same
definitions as set forth in the Sublease. The provisions of this Rider shall
supersede any inconsistent or conflicting provisions of the Sublease.
1. OPTION(S) TO EXTEND TERM.
1.1 GRANT OF OPTION. Landlord hereby grants to Tenant (3) option (s) (the
"Option(s)") to extend the Sublease Term for additional term(s) of (2) years
each (the "Extension(s)"), on the same terms and conditions as set forth in the
Sublease, but at an increased rent as set forth below.
1.1.1 Each Option shall be exercised only by written notice
delivered to Landlord at least one hundred eighty (180) days before the
expiration of the Sublease Term or the preceding Extension of Sublease Term,
respectively. If Tenant fails to deliver Landlord written notice of the exercise
of an Option within the prescribed time period, such Option and any succeeding
Options shall lapse, and there shall be no further right to extend the Sublease
Term.
1.1.2 Each Option shall be exercisable by Tenant on the express
conditions that (i) at the time of the exercise, and at all times prior to the
commencement of such Extension, Tenant shall not be in default under any of the
provisions of the Sublease, and (ii) Tenant has not been ten (10) or more days
late on the payment of rent more than a total of three (3) times during the
Sublease Term and all preceding Extensions.
1.2 PERSONAL OPTIONS. The Option(s) are personal to the Tenant named in
Section 1.3 of the Sublease or any Tenant's Affiliate described in Section 9.2
of the Sublease and cannot be transferred.
1.2.1 If Tenant subleases any portion of the Premises or assigns or
otherwise transfers an interest under the Sublease to an entity other than a
Tenant Affiliate prior to the exercise of an Option (whether with or without
Landlord's consent), such Option and any succeeding Options shall lapse.
1.2.2 If Tenant subleases any portion of the Premises or assigns or
otherwise transfers an interest of Tenant under the Sublease to an entity other
than a Tenant Affiliate after the exercise of an Option but prior to the
commencement of the respective Extension (whether with or without Landlord's
consent), such Option and any succeeding Options shall lapse and the Sublease
Term shall expire if such Option were not exercised.
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1.2.3 If Tenant subleases any portion of the Premises or assigns or
otherwise transfers an interest of Tenant under the Sublease in accordance with
Article 9 of the Sublease after the exercise of an Option and after the
commencement of the Extension related to such Option, then the term of the
Sublease shall expire upon the expiration of the Extension during which such
sublease or transfer occurred and only the succeeding Options shall lapse.
2. CALCULATION OF RENT
The Base Rent during the first year of the first extension only, shall b
ninety percent (90%) of the preceding year rent. Thereafter, the Base Rent
during any subsequent extensions shall continue to increase on each annual
anniversary of the Commencement Date as described in Section 1.9.1 of the
Sublease.
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[Floorplan of Building 6]
BUILDING # 6
CAMINO LABS
EXHIBIT A
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[Layout of Richardson Pacific Commerce Center]
EXHIBIT B
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EXHIBIT C
[Original Concept Design]
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