EXHIBIT 10.8
SECOND LEASE AMENDMENT AND EXTENSION AGREEMENT
This SECOND LEASE AMENDMENT AND EXTENSION AGREEMENT (this "Amendment")
is made and entered into as of the 29"' day of January, 2001, by and between
WALT DISNEY WORLD CO., a Florida corporation, as lessor ("Lessor"), and
PHYSIOLOGIC REPS INC., a California corporation, as lessee ("Lessee").
WITNESSETH:
WHEREAS, Lessee and Lessor's predecessor in interest, The Prudential
Insurance Company of America ("Original Lessor"), a New Jersey corporation,
entered into that certain Standard Industrial Lease - Net dated as of October 7,
1993, as amended by that certain First Amendment of Lease, dated as of November
9, 1993, entered into by and between Original Lessor and Lessee (as amended, the
"Lease"), pursuant to which, upon the terms and conditions contained therein,
Lessee leases from Lessor that certain property more commonly known as 932 Grand
Central Avenue, Glendale, California 91201, and comprised of an approximately
14,400 square foot building (the "Building") and related land and parking
improvements (collectively, the "Premises").
WHEREAS, the initial term of the Lease shall expire as of July 14,
2001.
WHEREAS, Lessee has timely exercised Lessee's sole renewal option
pursuant to Paragraph 63 of the Lease and Lessor and Lessee desire to
memorialize the extension of the term of the Lease pursuant thereto for an
additional five (5) year period, which extension shall be on the same terms and
conditions as set forth in the Lease, except as expressly modified by the terms
of this Amendment.
NOW, THEREFORE, for and in consideration of the mutual covenants and
premises herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. Defined Terms. Capitalized terms used but not otherwise defined
herein shall have the same meanings ascribed to them in the Lease.
2. Extension of Term. The term of the Lease is hereby extended for a
period of five (5) years (the "Option Term") commencing on July 15, 2001 (the
"Option Term Commencement Date") and terminating, unless sooner terminated
pursuant to the terms of the Lease, on July 14, 2006 (the "Option Term
Expiration Date").
3. No Remaining Renewal Options. Lessor and Lessee hereby acknowledge
and agree that the extension of the Lease term granted pursuant hereto is
pursuant to Lessee's timely exercise of Lessee's sole option right, as set
forth at Paragraph 63 of the Lease, and Lessee further acknowledges and agrees
that Lessee has no remaining options to extend the Lease term.
4. Base Rent. Effective as of the Option Term Commencement Date, the
monthly Base Rent during the Option Term shall be an amount equal to Twelve
Thousand Nine Hundred Sixty and No/100 Dollars ($12,960.00) (the "Option Term
Base Rent"), which shall be subject to annual increase pursuant to Paragraph 64
of the Lease.
5. Right to Require Quarterly Advance Payment of Rent. Lessor and
Lessee hereby covenant and agree that, in addition to all other rights and
remedies available to Lessor under the Lease and at law, in the event that
Lessee fails to timely make any and all payments due under the Lease during the
remainder of the initial term or the Option Term, then Lessor shall have the
right to immediately require that all rental payments due under the Lease be
made in advance on a quarterly basis throughout the remainder of the initial
term and/or the Option Term, as applicable.
6. Increased Securitv_Deposit On or prior to the Option Term
Commencement Date, Lessee shall deposit with Lessor an additional security
deposit in an amount equal to Three Thousand Six Hundred and No/l00 Dollars
($3,600.00) such that the amount of the security deposit held by Lessor shall
be equal to the Option Term Base Rent in accordance with Paragraph 5 of the
Lease.
7. Tenant Improvement Allowance. Lessor hereby covenants and agrees to
provide Lessee with an improvement allowance in an amount equal to up to Two
Thousand Four Hundred and No/100 Dollars ($2,400.00) (the "Tenant Improvement
Allowance"), which amount Lessor shall reimburse to Lessee for Lessee's costs
and expenses incurred in the installation of a fence (the "Fencing Work")
around the parking improvements portion of the Premises upon receipt from
Lessee of a receipt or receipts for such installation, together with any
supporting documentation that Lessor shall reasonably require; provided,
however, that (i) Lessor's obligations to reimburse Lessee for the Fencing Work
pursuant to this Section 7 shall (x) be excused during and throughout any
period during which Lessee is in material default under Paragraph 13.1 of the
Lease, and (y) in no event be deemed an assumption by Lessor of any obligations
to provide security services to the Premises or to ensure the safety or
security of the parking improvements portion of the Premises, and (z) in no
event be deemed a guaranty by Lessor of, or a representation by Lessor as to
the quality or fitness of the Fencing Work or the compliance thereof with any
applicable laws, codes, rules and/or regulations; and (ii) in the event that
there are any outstanding (past due and payable) monies due to Lessor pursuant
to the Lease at the time that Lessee submits its request for reimbursement of
the Tenant Improvement Allowance, then Lessor may, at Lessor's sole discretion,
elect to apply the amount of the Tenant Improvement Allowance requested to he
reimbursed to Lessee (and reasonably evidenced by supporting invoices) to such
outstanding monies, rather than paying such amount to Lessee, and Lessee hereby
acknowledges and agrees that such application of the Tenant Improvement
Allowance shall satisfy Lessor's obligations to provide the Tenant Improvement
Allowance pursuant to this Section 7. Lessee hereby acknowledges and agrees
that Lessee shall be responsible for all costs of the Fencing Work in excess of
the Tenant Improvement Allowance and Lessee hereby covenants and agrees to
perform the Fencing Work at all times in accordance with Paragraphs 7.5 and 49
of the Lease.
8. Roof Replacement. Lessor hereby covenants and agrees that Lessor
shall, prior to the Option Term Commencement, Date, at Lessor's sole cost and
expense, replace the roof on the Building; provided, however, that Lessor's
obligations pursuant to this Section 8 shall be excused during and throughout
any period during which Lessee is in material default under
Paragraph 13.1 of the Lease.
9. Broker Commissions. Lessee and Lessor each represent and warrant to
the other that neither has had any dealings with any person, firm, broker or
finder in connection with the negotiation of this Amendment and/or the
consummation of the transaction contemplated hereby, other than CB Richard
Ellis, Inc. (the "Lessor's Broker"), and, other than Lessor's Broker, no broker
or other person, firm or entity is entitled to any commission or finder's fee
in connection with said transaction. Lessee and Lessor do each hereby indemnify
and hold the other harmless from and against any costs, expenses, attorneys'
fees or liability for compensation, commission or charges that may be claimed
by any broker, finder or other similar party, other than Lessor's Broker, by
reason of any dealings or actions of the indemnifying party. This indemnity
shall survive the expiration or earlier termination of the Lease or this
Amendment.
10. No Relocation Benefits. Lessee acknowledges and agrees chat the
consideration provided to Lessee pursuant to the terms of the Lease, as amended
hereby, includes any and all compensation, damages and benefits to which Lessee
and its shareholders, officers, directors, employees, agents, successors,
assigns, predecessors, partners, principals, guarantors, attorneys and
representatives might be entitled to or arising out of the California Relocation
Assistance Act (Government Code Section 7260 et seq.) including, but not limited
to, actual moving expenses, fixed payment in lieu thereof, loss of goodwill,
direct losses of tangible personal property, costs or re-establishment and any
other relocation benefits of any kind; provided, however, that (1) nothing
herein shall be deemed to modify, lessen, or otherwise waive Lessor's
obligations pursuant to subsections (b) and (c) of Paragraph 67 of the Lease
with respect to any exercise by Lessor of its relocation right pursuant thereto;
and (ii) nothing contained in this Section 10 shall be deemed to affect or
impair Lessee's rights to any and all compensation, damages and benefits to
which Lessee might be entitled to under or arising out of the California
Relocation Assistance Act during the term of the Lease (including the Option
Term and any additional extension term(s) agreed to in writing by Lessor and
Lessee).
11. Notices. Lessor and Lessee hereby acknowledge and agree that as of
the date hereof Paragraphs 23 and 54 of the Lease shall be replaced in their
entirety by the following notice provision:
Notices. Any notice given pursuant to this Lease shall be personally delivered,
delivered by Federal Express or comparable overnight courier, providing written
evidence of delivery, or delivered by U.S. registered or certified mail, return
receipt requested, postage prepaid and sent to Lessor and Lessee at the
following addresses:
LESSOR: Grand Central Business Centre 512 Paula Avenue, Suite B
Glendale, CA 91201 Attention: Property Manager
With a copy to:
Walt Disney World Co.
c/o Disney Worldwide Services, Inc. -
CRE Attention: Lease Administration
500 South Buena Vista Street
Burbank, CA 91521-2680
With an additional copy to:
The Walt Disney Company
Attention: Corporate Legal-Real Estate
If by messenger:
3800 West Alameda Street, 20'x' Floor
Burbank, CA 91505-6375
If by mail:
500 South Buena Vista Street
Burbank, CA 91521-6375
LESSEE: Physiologic Reps Inc.
932 Grand Central Avenue
Glendale, CA 91201
Attention: Al Guadagno, Senior Vice President
or such other address(es) as either party may from time to time designate as its
notice address by notifying the other party thereof. Notice so sent shall be
deemed given (a) when personally delivered, or (b) on the first business day
following deposit with Federal Express or a comparable overnight courier service
providing written evidence of delivery, or (c) five business days following
deposit in the United States mail, if notice is sent by registered or certified
mail, return receipt requested, postage prepaid.
12. No Use of Disney Name. Lessee does not acquire any right under this
Amendment or the Lease to use, and shall not use, Lessor's name, the name
"Disney" (either alone or in conjunction with or as part of any other word or
name) or any registered trademarks or service marks or any fanciful characters
or designs of Lessor or Lessor's affiliates: (i) in any advertising, publicity
or promotion; (ii) to express or imply any endorsement by Lessor of any services
of Lessee or any other person or entity; or (iii) in any other manner whatsoever
(whether or not similar to the uses hereinabove specifically
prohibited). The provisions of this Section 12 shall survive the expiration or
earlier termination of the Lease or this Amendment.
13. No Changes: Conflicting Terms. Except as expressly modified hereby,
all terms and conditions of the Lease, shall remain in full force and effect,
shall be binding on the parties hereto, and are hereby ratified and affirmed. In
the event a conflict exists between, the terms and conditions of this Amendment
and the terms and conditions of the Lease, the terms and conditions of this
Amendment shall control.
14. Miscellaneous. The mutual obligations of the parties as provided
herein are the sole consideration for this Amendment, and no representations,
promises or inducements relating to this Amendment have been made by the parties
other than as appear in this Amendment. This Amendment may not be amended except
in writing signed by both parties. The representations, agreements and
obligations contained in this Amendment shall survive the execution and delivery
of this Amendment. This Amendment may be executed in one or more counterparts,
each of which shall be deemed an original and all of which. taken together,
shall constitute one and the same agreement. This Amendment and the terms and
provisions hereof shall inure to the benefit of, and be binding upon, the
parties hereto, and their respective heirs, successors, legal representatives
and assigns. This Amendment shall be construed and enforced in accordance with
the laws of the State of California.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed as of the date and year first set forth above.
LESSOR:
WALT DISNEY WORLD CO., a Florida
corporation, as successor in
interest to The
Prudential Insurance Company of
America
By: /s/ Marsha L. Reed, Assistant Secretary
LESSEE:
PHYSIOLOGIC REPS INC., a California
corporation
/s/ A1 Guadagno
Title: Senior Vice President and CFO