HomeMy WebLinkAboutRDA LEASE DEV AG 01-21-91t�.
DATE:
TO:
FROM:
SUBJECT:
JANUARY 15, 1991
WILLIAM A. HUSTON, EXECUTIVE DIRECTOR
RDA 5
1-21-91
Inter - Com
CHRISTINE SHINGLETON, DIRECTOR OF COMMUNITY DEVELOPMENT
CITY HALL RELOCATION - LEASE DEVELOPMENT AGREEMENT FOR 15222
DEL AMO AVENUE
RECOMMENDATION
Authorize the Executive Director to sign a lease for property at
15222 Del Amo Avenue between Catellus Development Corporation and
the Tustin Community Redevelopment Agency, subject to City Attorney
approval.
BACKGROUND
The Tustin Redevelopment Agency at a regular meeting on August 20,
1990 authorized the Executive Director to select and negotiate a
temporary relocation site for City Hall operations during
construction of the expansion to Civic Center. On October 1, 1990,
the Executive Director approved a Letter of Intent with Catellus
Development for lease of approximately 24,300 square feet of a
larger building located at 15222 Del Amo Avenue, just south of
Edinger Avenue.
Staff and the City Attorney's office have finalized the terms and
conditions of the proposed facility lease which is attached for
review and approval by the Redevelopment Agency (exhibits will be
added prior to execution) . The following is a summary of the major
terms and conditions of the proposed lease:
Term: Initial lease term is three years. The Agency may
extend initial lease term month to month.
Base Rent: Months 1 $.65 per sf or $15,795 per month
Months 2-4 no base rent (operating expenses only)
Months 5-12 $.65 per sf or $15,795 per month
Months 13-24 $.70 per sf or $17,010 per month
Months 25-36 $.75 per sf or $18,225 per month
Months 37-40 if Agency extends lease term - $.80 per
sf or $19,440 per month
Months 40+ 150% of last month of term ($1.20 per sf
or $29,160 per month)
Redevelopment Agency Report
City Hall Relocation - Lease
Development Agreement
January 21, 1991
Page 2
Operating
Expenses/Real
Property
Taxes: Lease is a triple net lease so Agency is
responsible for their pro rata share of operating
expenses including but not limited to taxes,
insurance, maintenance and utilities. Said
expenses are currently estimated at $.14 per square
foot, but could approach approximately $.35 upon
full building occupancy.
Tenant
Improvements: turnkey improvements for said
ents: Catellus to provide
space based on a mutually agreed space plan up to a
cost of $150,000. Preliminary construction for
preliminary space plan work seems to indicate that
a major portion of work would be possible within
the Landlord's $150,000 tenant improvement credit.
Building: Catellus to deliver the building and its
mechanical, electrical and plumbing systems in good
working order. Agency will be responsible for
continuing maintenance per the term of the triple
net lease.
A more detailed Performa Schedule is attached for the proposed
Lease Agreement. Based upon the informaticn provided, annual
escalation of the initial base rent is 5% per year which is within
the 4-8% annual escalation range normally found on a triple net
lease.
Anticipated first year lease costs have been budgeted as part of
the 1990-91 Redevelopment Agency Budget which authorized $600,000
for first year moving and relocation expenses as part of the Civic
Center expansion program. Future annual lease payments will be
considered as part of the Agency's future budget requests.
Community Develcpment Department
Redevelopment Agency Report
City Hall Relocation - Lease
Development Agreement
January 21, 1991
Page 3
Once all lease documents are executed, a more precise tentative
schedule for the proposed move can be determined. Said move -in
date, however, is expected to be sometime in April.
t�
Christine A. Shing on
Director of Community Development
CAS:kbc\lease.cas
Attachments: Performa Schedule
Community Development Department
ATTACHMENT A
15222 DEL AMO
PERFORMA SCHEDULE
INITIAL BASE TERM
MONTH
X
SIZE x
RENTAL
RATE +
OPERATING EXPENSES*
= ESTIMATED TOTAL COSTS
1
x
24,300
SF x
$1.00
($.65
+ $.35)
_ $ 24,300
2-4
x
24,300
SF x
0.35
($.00
+ $.35)
= 25,515
5-12
x
24,300
SF x
1.00
($.65
+ $.35)
= 194,400
13-24
x
24,300
SF x
1.05
($.70
+ $.35)
= 306,180
25-36
x
24,300
SF x
1.10
($.75
+ $.35)
= 320.760
Total Rent + Operating Expense for Initial Lease Term = $848,155
Excludes cost of living increases in operating expenses that may occur
and Agency's own janitorial services. Anticipated operating expenses
have been obtained from current available data but actual billings may
vary depending upon actual costs.
Community Development Department
L-5040
1502L
TRIPLE NET LEASE
Between
CATELLUS DEVELOPMENT CORPORATION,
a Delaware corporation, as Landlord
and
TUSTIN COMMUNITY REDEVELOPMENT AGENCY,
as Tenant
1.
2.
3.
4.
5.
6.
`IM
a
TABLE OF CONTENTS
Parties . 0 0 01
1
Premises.
Term
3.1
Initial Term
1
1
3.2
Completion of Premises.
1
3.3
Early Occupancy
Rent
4.1
Commencement of Monthly Rent
2
2
4.2
Initial Base Rent
2
4.3
Rental Adjustments.
2
4.4
Additional Payments; No Offset.
Advance
Rental; Security Deposit.
2
Use
3
6.1
Use.
3
6.2
Compliance with Law. .
4
6.3
Condition of Premises .
Maintenance, Repairs and Alterations
7.1
Tenant's Obligations
4
S
7.2
Surrender . - . o
S
7.3
Landlord's Rights
5
7.4
Landlord's Obligations.
5
7.5
Alterations and Additions
Insurance; Indemnity
8.1
Insurance to be provided by Tenant.
o 6
7
8.2
Property Insurance on the Building.
o
7
8.3
Waiver of Subrogation
7
8.4
Indemnity
7
8.5
Exemption of Landlord from Liability
Damage
or Destruction
9.1
Definitions o o
8
8
9.2
Partial Damage -- Insured Loss.
o o
8
9.3
Partial Damage -- Uninsured Loss
9
9.4
Total Destruction . o
o
9
9.5
Damage Near End of Term
9.6
Abatement of Rent; Tenant's Remedies
o
10
9.7
Termination -- Advance Payments
9.8
Waiver. o
o10
(i)
10. Real Property Taxes
10.1 Payment of Taxes
10
10
10.2 Definition of "Real Property Tax
10
10.3 Joint Assessment
11
10.4 Personal Property Taxes
11.
Utilities
11
12.
Assignment and Subletting
12.1 Consent of Landlord
11
12.2 No Release of Tenant
12.3 Tenant to Keep Sublease Profits
13.
Defaults; Remedies
13.1 Defaults
11
12
13.2 Remedies
13
13.3 Default by Landlord
13
13.4 Late Charges
13
13.5 Impounds
14.
Condemnation.
14
14
15.
Broker's Fee.
14
16.
Estoppel Certificate.
15
17.
Landlord's Liability.
18.
Severability. o o o o
o15
15
19.
Interest on Past -due Obligations.
15
20.
Time of Essence .
15
21.
Additional Rent
15
22.
Incorporation of Prior Agreements; Amendments
15
23.
Notices
16
24.
Waivers
16
25.
26.
Recording
Holding Over - Lease Term - Partial Extension
16
27.
Cumulative Remedies . o o
16
16
28.
Covenants and Conditions. o o o
16
29.
Binding Effect; Choice of Law
16
30.
Subordination
17
31.
Attorney's Fees
17
32.
Landlord's Access
17
33.
Auctions.
34.
Signs o o o17
35.
Merger o
o18
18
36.
Consents.
18
37.
Quiet Possession.
18
38.
Security Measures
18
39.
Easements
18
40.
Performance Under Protest
18
41.
Authority
19
42.
Financial Statements.
43. Landlord's Work 19
44. Parking
20
45. Force Majeure - Unavoidable Delay 20
46. CC&R' s 20
47. Hazardous Materials; Environmental Compliance 20
48. Common Areas. 21
48.1 Landlord's Maintenance of Common Areas. 22
48.2 Control of Common Areas 22
48.3 Payment of Common Area Cost 22
L-5040
CA0591512
1502L
TRIPLE" NET LEASE
BETWEEN CATELLUS DEVELOPMENT CORPORATION, AS LANDLORD
AND
TUSTIN COMMUNITY REDEVELOPMENT AGENCY, AS TENANT
1. Parties.
This Lease is effective as of the 6th day of November, 1990, and is
made by and between CATELLUS DEVELOPMENT CORPORATION, a Delaware corporation
("Landlord"), and the TUSTIN COMMUNITY REDEVELOPMENT AGENCY, ("Tenant").
2. Premises.
Landlord hereby leases to Tenant, and Tenant leases from Landlord,
for the term, at the rental, and on all of the terms and conditions set forth
herein, certain real property in the County of Orange, State of California,
consisting of approximately 24,300 square feet (the "Premises") of a larger
building containing approximately 59,828 square feet commonly known as 15222
Del Amo Avenue, Unit B, Tustin (the "Building"), together with the appurtenant
right to use, in common with others, the lobbies, entrances, stairs, elevators
and other public portions of the Building and the property designated by
Landlord for common use by the tenants, subject to the terms and conditions
set forth in this Lease. The Premises, Building and common areas are shown on
the site and floor plans attached hereto as Exhibits "A-1", "A-2", and "A-3"
and made a part hereof.
3. Term.
3.1 Initial Term.
(a) The "Initial Term" of this Lease shall be thirty-six (36)
months, commencing on the first (lst) day of the first full month following
the earliest of (i) the day on which Landlord files or causes to be filed with
the City of Tustin (if required) and delivered to Tenant an architect's notice
of substantial completion, or similar written notice that Landlord's Work (as
defined in paragraph 43) is substantially complete, (ii) the day on which
Tenant commences substantially normal business operations in the Premises, or
(iii) the day on which a certificate of occupancy is issued for the Premises
(the "Commencement Date"). Notwithstanding the foregoing, if such event
occurs on the first day of a month, that date shall be the Commencement Date.
Landlord and Tenant shall execute an amendment to this Lease stating the
Commencement Date, promptly upon determination of such date. Tenant's failure
to execute and deliver such amendment upon Landlord's request shall constitute
a material default under this Lease. The parties hope the Commencement Date
will be on or before April 1, 1991.
(b) In the event of any delay in Tenant's occupancy caused in
whole or in part by Tenant, its agents, or contractors, or by force majeure,
there shall be no change in the Commencement Date unless there has also been a
delay on the part of Landlord in delivering possession of the Premises, in
which event the period of delay attributable to Tenant or toforce
shall be credited against any time delays chargeable to Landlord
determining the rent commencement date.
3.2 Completion of the Premises. Landlord shall undertake
ner prosecute the
construction of Landlord's Work and shall diligently pro
construction to completion.
3.3 Early 0 Qancv. The period of
Tenant to the Commencement Date
dtif any, from the date
possession of the Premises is delivered
shall be the ��Early Occupancy Period". Tenant's occupancy oft he P remisesions
during the Early Occupancy Period shall be subjereaall
rovisions, but such
of this Lease, including without limitation
notthe
ntalextend theLeaseTerm or change
period of possession and occupancy shall
the Commencement Date. Rent for such period shall be at the rate set
dforthi n
paragraph 4.2, pro -rated on the basis of a 30 -day month and shall
and
payable on or before the Commencement Date.
4.
4
.1 mm n m n f Mon hl R n . Tenant shall pay to Landlord
dts rent
0 in
for the Premises, monthly pay
ments as set forthntefor�any periodeduring the
first day of each month of the hanterm
onehereof.
month shall be a pro rata portion of
term hereof which is for less t Rent shall be payable in
the monthly installment based on aoto OLadtat Department 4580, Pasadena,
lawful money of the United States t
California 91050-4580 or to such other persons or at such other places as
Landlord may designate in writing.
4.2
Initial Base Rent. The initial base rent shall be FIFTEENN THOUSAND
SEVEN HUNDRED NINETY FIVE DOLLARS ($15,795.00)r monthdedmmencingis not then
on the
Commencement Date. Notwithstandingease,Lanlord hereby waives the base rent
ngthe foregoing,
Tant
in default under any terms of t the
able for the second (2nd), third (3rd) and fourth (4th) months of
Initial Term. Such waiver app ply to
pay lies to base rent only and shall P
any other sums payable under the Lease.
Rn
4.3
R n 1 Ad'Jus men t . Commencing on the first day of the
thirteenth
(13th) and twenty-fifth (25th) months of the Initial Term, the in
itial rent set forth in paragraph 4.2 shall automatically and without prior notice
increase as follows:
Months 13 - 24 $17,010.00 per month
nth
Months 25 - 36 $18,225.00 p
4.4 Additional Payments' No Offset. All sums of money
or chargees
in
(other than rent which shall be payable inthu manner
elsewhere
shall, rovexcept where
dd
this Lease) required to be paid by Tenant under
provided to the contrary in this Lease, be due and payable within thirty (30)
days after demand as additional rent. Tenant's failure
toonseque nces such
amounts or charges when due shall carry
with
uder this Lease shall be made in
as
Tenant's failure to pay rent. All payments
full and without offset or deduction of any kind. All payments of rent,
- 2 -
additional rent and other sums hereunder shall be deemed to be payments on
account. Neither the acceptance by Landlord of any rent, additional rent or
other sums in an amount which is less than the amount due and payable pursuant
to this Lease nor the failure of Landlord to issue a statement or invoice
therefor, nor the issuance of a monthly statement showing as due and payable
an amount less than is properly due and payable pursuant to the terms of this
Lease, nor any delay in or failure to implement any rent adjustment provided
for herein, shall constitute an agreement by landlord modifying this Lease or
a waiver of Landlord's right to receive all sums provided for herein.
5. Advance Rental; Security Deposit.
(a) Concurrently with Tenant's execution of this Lease, Tenant
shall deposit with Landlord the sum of FIFTEEN THOUSAND SEVEN HUNDRED NINETY
FIVE DOLLARS ($15,795.00), which is the rent due for the first month of the
term hereof, and the sum of EIGHTEEN THOUSAND TWO HUNDRED TWENTY FIVE DOLLARS
($18,225.00), which sum shall be held by Landlord without liability for
interest, as security for the faithful observance and performance by Tenant of
all terms, covenants and conditions of this Lease to be observed and performed
by Tenant during the Term hereof or any extension thereof. Tenant shall not
use the security deposit to pay the last, or any other, month's base or other
rent hereunder. Landlord may require Tenant to increase its security deposit
from time to time to an amount equal to the then current monthly installment
of base rent. If at any time during the Term of this Lease, Tenant should
fail to observe and perform any of the terms, covenants and conditions of this
Lease to be kept and performed by Tenant, Landlord, at its option, may utilize
said deposit, or any part thereof, for any damages or rents which may accrue
or which may be payable to it by the Tenant. If Landlord elects to utilize
all or part of the security deposit, as aforesaid, Tenant shall, upon written
notice from Landlord, forthwith deposit the amount necessary to restore the
security deposit to its original amount, plus all increases thereto, it being
the express intent of Tenant and Landlord that Landlord shall hold a security
deposit in the aforesaid amount at all times during the entire Term of this
Lease and any extension or renewal thereof. Tenant's failure to so restore
the full amount of said security deposit within five (5) days after written
notice from Landlord shall constitute a material brcach of this Lease.
Notwithstanding the foregoing, provided Tenant is the Tustin Community
Redevelopment Agency and is not in default under any of the provisions of this
Lease, no security deposit shall be required.
6. Q.0 .
6.1 Ulk. The Premises shall be used and occupied only for general
administrative offices and storage and for any other use which is reasonably
comparable, and for no other purpose.
6.2 Compliance with Law.
(a) Landlord warrants to Tenant that the Premises, as of the
Commencement Date, but without regard to the use for which Tenant will use the
Premises, will not violate any covenant or restriction of record, or any
applicable building code, regulation or ordinance in effect on the
Commencement Date. In the event it is determined that this warranty has been
- 3 -
violated, then it shall be the obligation of the Landlord, after written
notice from Tenant, to promptly, at Landlord's sole cost and expense, rectify
any such violation. In the event Tenant does not give Landlord written notice
of the violation of this warranty within thirty (30) days after Tenant becomes
or, in the exercise of reasonable care, should have become aware of any such
violation, the correction of same shall be the obligation of the Tenant at
Tenant's sole cost.
(b) Except as provided in paragraph 6.2(a), Tenant shall, at
Tenant's expense, comply promptly with all applicable statutes, ordinances,
rules, regulations, orders, covenants and restrictions of record, and
requirements in effect during the term or any part of the term hereof,
regulating the use by Tenant of the Premises, including without limitation,
laws pertaining to the storage, use, disposal and reporting of hazardous
substances on the Premises. Tenant shall not use or permit the use of the
Premises in any manner that will tend to create waste or a nuisance or, if
there shall be more than one tenant in the Building, shall tend to disturb
such other tenants.
6.3 Condition of Premises.
(a) Landlord shall deliver the Premises to Tenant clean and free
of debris and shall provide Tenant access to the Premises prior to the
Commencement Date for the purpose of installing fixtures, equipment and tenant
improvements. Landlord warrants to Tenant that the plumbing, lighting,
heating, and loading doors in the Premises shall be in good operating
condition on the Commencement Date. In the event that any of such items are
not in good operating condition on the Commencement Date, Tenant shall give
Landlord written notice of such condition within thirty (30) days following
the Commencement Date and Landlord shall promptly and at its sole cost effect
necessary repairs. Tenant's failure to give such written notice to Landlord
within thirty (30) days after the Commencement Date shall terminate Landlord's
obligations hereunder.
(b) Landlord further warrants the parking lot surface, Building
foundations, roof, and walls for a period of one (1) year following the
Commencement Date, except for normal wear and tear or abuse. In the event of
a failure or defect in any of such components, Tenant shall give Landlord
written notice of such condition within thirty (30) days following discovery
and Landlord shall promptly and at its sole cost effect necessary repairs.
Tenant's failure to give such written notice to Landlord within thirty (30)
days following discovery of such a condition shall terminate Landlord's
obligations hereunder.
(c) Except as otherwise provided in this Lease, Tenant hereby
accepts the Premises in their condition as of the Commencement Date or the
date that Tenant takes possession of the Premises, whichever is earlier,
subject to all applicable zoning, municipal, county and state laws, ordinances
and regulations governing and regulating the use of the Premises, and any
covenants or restrictions of record, and accepts this Lease subject thereto
and to all matters disclosed thereby and by any exhibits attached hereto.
Tenant acknowledges that neither Landlord nor Landlord's agent has made any
representation or warranty as to the present or future suitability of the
Premises for the conduct of Tenant's business.
- 4 -
7. Maintenance, Reeairs and Alteration.
7.1 Tenant's Obligations.
(a) Except as provided in paragraphs 6.3 (a), (ndre
'c) and
the
paragraph 7.4, Tenant shall keep in good order,
c�uchtportion of Premises
Premises and every part thereof, (whether or not
requirinrepairsor the means of repairing the same are reasonably o r curs readily
,
accessible to Tenant, and whether or not the need
for
such
the agerepairs
such portion
result of Tenant's uses any prior use, the elements or
of the
Premises) including, without limiting the generality of i ti es
all plumbing , heatf oand
regoi ng,
ing , vents 1 ati ng , electrical, light
wal j s9 cei 1 i ngs , f 1 oors ,
equipment within the Premises, fixtures, interior
windows, doors, plate glass and skylights. Notwithstandingthe
rovided
titled to the benefit of any warranties rbgoing,
Tenant shall be en construction of the
ectin with the Buildings
contractors or suppliers in conn
and tenant improvements.
(b) Tenant shall maintain the Premises in a neat, attractive and
orderly condition at all times.
7.2 Surren r. On the last day of the term hereof,
drinnthe any
same sooner
termination, Tenant shall surrender the Prandstear°(which includes the effect
condition as when received, ordinary wear
Tenant shall repair
of natural elements) excepted, clean and free
lation or removal of
any damage to the Premises occasioned by the instal
Tenants
trade fixtures, furnishings and equipment. Notwithstandiinghenyihing
to the contrary otherwise stated in this Lease, Tenant shall lea
lighting fixtures, space
lines, power panels, electrical distan�ution fencingsonmthe Premises in good
heaters, air conditioning, plumbing
operating condition.
7.3
L n 1 r Rights. If Tenant fails to perform Tenant's °Landltions
under this paragraph 79 or under any other paragraph of this
tLeases Laes after
may at its option (but shall. not be requiredenter upin the case of an
thirty (30) days' prior wno notice ten tshall ice oTenant (except be required), perform such
emergency, in which case no
on Tenant's behalf and put the same in good order, thedmax�mumand
obligations
repair, and the cost thereof together witcome dueiandreayablerasnadditional rental
rate then allowable by lawTenant'shall senext rental installment.
to Landlord together with
7.4 Landlord's Ob 11 ations.
(a) Landlord shall be responsible for the maintenance and repair,
at Landlord's sole cost and expense, of the foundations, exterior
errexto rior oof walls),
and
exterior walls of the Building, (excluding painting of the
except t for repairs required as a result of roof penetrations oagents, building
il ng
modifications made or damage caused by Tenant, its employees,
contractors, which shall be the responsibility of Tenant.
(b) Landlord shall have the right to procure and maintain, at
Tenant's expense, contracts for the maintenance and repair of
the heatings
- 5 -
ventilating and air-conditioning system for the Premises. Tenant shall
reimburse Landlord, upon demand, for the cost thereof.
7.5 Alterations and Additions.
(a) Tenant shall not, without Landlord's prior written consent
make any alterations, improvements, additions, or Utility Installations in, on
or about the Premises, except for non-structural alterations not exceeding
$10,000 in costs per project. In any event, whether or not in excess of
$10,000 in cost, Tenant shall make no change or alteration to the exterior of
the Premises nor the exterior of the building on the Premises without
Landlord's prior written consent. As used in this paragraph 7.5 the term
"Utility Installation" shall mean air lines, power panels, electrical
distribution systems, exterior lighting fixtures, space heaters, air
conditioning, plumbing, and fencing. Landlord may require that Tenant remove
any or all of said alterations, improvements, additions or Utility
Installations at the expiration of the term, and restore the Premises to their
prior condition. Should Tenant make any alterations, improvements, additions
or Utility Installations without the prior approval of Landlord, Landlord may
require that Tenant remove any or all of the same. Any alterations and
additions installed or performed by Tenant shall comply with all applicable
building codes, ordinances and similar requirements.
(b) Any alterations, improvements, additions or Utility
Installations in, or about the Premises that Tenant. shall desire to make and
which require the consent of the Landlord shall be presented to Landlord in
written form, with proposed detailed plans. If Landlord shall give its
consent, the consent shall be deemed conditioned upon Tenant acquiring a
permit to do so from appropriate governmental agencies, the furnishing of a
copy thereof to Landlord prior to the commencement of the work and the
compliance by Tenant of all conditions of said permit in a prompt and
expeditious manner.
(c) Tenant shall pay, when due, all claims for labor or materials
furnished or alleged to have been furnished to or for Tenant at or for use in
the Premises, which claims are or may be secured by any mechanics' or
materialmen's lien against the Premises or any interest therein. Tenant shall
give Landlord not less than ten (10) days' notice prior to the commencement of
any work in the Premises, and Landlord shall have the right to post notices of
non -responsibility in or on the Premises as provided by law. If Tenant shall,
in good faith, contest the validity of any such lien, claim or demand, then
Tenant shall, at its sole expense defend itself and Landlord against same and
shall pay and satisfy such adverse judgment that may be rendered thereon
before the enforcement thereof against the Landlord or the Premises, upon the
condition that if Landlord shall require, Tenant shall furnish to Landlord a
surety bond satisfactory to Landlord in an amount equal to such contested lien
claim or demand indemnifying Landlord against liability for the same and
holding the Premises free from the effect of such lien or claim. In addition,
Landlord may require Tenant to pay Landlord's reasonable attorneys fees and
costs in participating in such action if Landlord shall decide it is to its
best interest to do so.
S�
et
rth
M Unless Landlord requires their :,emoval , as and fo 1 i tyn
paragraph 7.5(a), all alterations, improvements, additions
Installations (whether or not such Utility Installations constitute trade
fixtures of Tenant), which may be made on the Premises,shall
withlthe Premises at
the
property of Landlord and remain withstandin n and be sthe provisions of this
the expiration of the term. Not 9
P9
ars raph 7.5 (d), Tenant's machinery and equipment, other than that which
i s
affixed to the Premises so that it cannot be ctmsuch such at its expense),
damage
to the Premises (unless Tenant elects to effe
shall remain the property of Tenant and may be removed by Tenant subject to
the provisions of paragraph 7.2.
8. Insurance' Indemnity.
8.1 Insurance to be provided by Tend. Tenant shall obtain
and
maintain throughout the term of this Lease trapes of Rider attached hereto as
with
��
coverage in the amounts required on the Insunce
Exhibit B and made a part hereof. Tenant shall deliver to Landlord
teprirm upono
taking possession of the Premises, and from time to time certificateof the insurance
Landlord's written request, aoflthe insurer or insurers, or a
executed by an authorized representative
certified copy of the policy or policies as evidence of such insurance.
In
the alternative, Tenant's _agent may furnish adoheretoasExhibit "C"). If
dstandard
endorsement, (a copy of which has been attache
Tenant fails to comply with this requirement, Landlord may, but shall
upon
ll opt be
obligated to, obtain such insurance and keep the same in
effect and
demand, Tenant shall pay to Landlord, as additions
premium cost
thereof.
8.2 Property Insurance on the Building. Tenant recognizes and
acknowledges that Landlord insures the existing building improvementsincluded
in the Premises under its current blanket fire rilsrance earthquake and flood.
or damage over $10,000 due tofire,
extended
aeta share (currently 41X) of the
Tenant agrees to be responsiblfor its
e pro r
first $109000 of any loss and to pay Landlord Tenant's pro rate of the
cost of said blanket insurance policy, in twelve monthly installment
payment of base rent, or at Landlord's option, in one annual ortwo
efor.
semi-annual payments within 10 days after receipt o abilling t
her8.3 Waiver of Subroqation. Tenant and Landlord each hereby relainst ease and
relieve the other, and waive their entire right of recoils insured against
er
for loss or damage arising out of or icinenOntorthe about the Premises, whether
under paragraph 8.2, which perils occur
due to the negligence of Landlord or Tenant or their agents,
employees,
aining the
contractors and/or invitees. Tenant and Landlord P
policies of insurance required hereunder, give notice to the insurance carrier
or carriers that the foregoing mutual waiver of subrogation is contained in
this Lease.
8.4 Indg—mn—i—tY. Tenant shallpromptly
Landlord from and against
yd and lor from the
ims
use or operation of the Premises,
- 7 -
indemnify and hold harmless
arising from Tenant's negligent
negligent conduct of Tenant's
business or from any activity, work or things done, permitted or suffered by
Tenan,� in or about the Premises or elsewhere and shall further indemnify and
hold harmless Landlord from and against any and all claims arising from any
breach or default in the performance of any obligation on Tenant's part to be
performed under the terms of this Lease, or arising from any negligence of the
Tenant, or any of Tenant's agents, contractors, or employees, and from and
against all costs, reasonable attorney's fees, expenses and liabilities
incurred in the defense of any such claim or any action or proceeding brought
thereon, and in case any action or proceeding 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 satisfactory to Landlord. As between
Landlord and Tenant, 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 arising from any cause and Tenant hereby waives
all claims in respect thereof against Landlord. Notwithstanding anything in
the foregoing to the contrary, Tenant shall have no obligation to indemnify
Landlord for claims resulting exclusively from the sole negligLnce of
Landlord, its employees, agents and contractors.
8.5 ExemQtion of Landlord from Liability. Tenant hereby agrees that
Landlord shall not be liable for injury to Tenant's business or any loss of
income therefrom or for damage to the goods, wares, merchandise or other
property of Tenant, Tenant's employees, invitees, customers, or any other
person in or about the Premises, nor shall Landlord be liable for injury to
the person of Tenant, Tenant's employees, agents or contractors, whether such
damage or injury i s caused by or results from fire, steam, electricity, gas,
water or rain, or from the breakage, leakage, obstruction or other defects of
pipes, sprinklers, wires, appliances, plumbing, air conditioning or lighting
fixtures, or from any other cause, whether the said damage or injury results
from conditions arising upon the Premises or upon portions of the building of
which the Premises are a part, or from other sources or places and regardless
of whether the cause of such damage or injury or the means of repairing the
same is inaccessible to Tenant. Notwithstanding anything in the foregoing to
the contrary, Landlord s`,all not be exempt from liability for claims resulting
exclusively from the sole negligence of Landlord, its employees, agents and
contractors.
9. Damage or Destruction.
9.1 Definitions.
(a) "Premises Partial Damage" shall herein mean damage or
destruction to the Premises to the extent that the cost of repair is less than
50% of the then replacement cost of the Premises. "Premises Building Partial
Damage" shall herein mean damage or destruction to the Building to the extent
that the cost of repair is less than 50% of the then replacement cost of the
Building as a whole.
(b) "Premises Total Destruction" shall herein mean damage or
destruction to the Premises to the extent that the cost of repair is 50% or
more of the then replacement cost of the Premises. "Premises Building Total
Destruction" shall herein mean damage or destruction to the Building to the
extent that the cost of repair is 50% or more of the then replacement cost of
the Buildings as a whole.
(c) "Insured Loss" shall herein mean damage or destruction which
was caused by an event required to be covered by the insurance
paragraph 8.
9.2 Partial Damage --Insured Loss. Subject to the provisions of
paragraphs 9.4, 9.5 and 9.60 if at any time during ths and which falls erm i into tthi s Lease
there is damage which is an Insured Lmasaor Premises Building Partial Damage,
he
classification of Premises Partial Damage
then Landlord shall, at Landlord's expense, repair such damage, but not
Tenant's fixtures, equipment or tenant improvements unless the same have
become a part of the Premises pursuant to paragraph 7.5
hereof,
as sonas effect.
reasonably possible and this Lease shall conti ue in
9.3 Partial Damage --Uninsured Loss. Subject to the provisions of
paragraphs 9.4, 9.5 and 9.6, if at any time during the
term of this these
there is damage which is not an Insured Loss and white
fallclassification of Premises Partial Damage or Premises Building Partial Damage,
unless such damage is negligently or intentionally caused by Tenant (in which
event Tenant shall make the repairs at Tenant's expense), Landlord may at
Landlord's option either (i) repair such damage as soon as reasonably possil forbee
at Landlord's expense, in which event this Leaseshall
within thirty (30) days
sao
and effect, or (ii) give written notice to Te
after the date of the occurrence of such damage of Landlord's intention to
cancel and terminate this Lease, as o; the date of the occurrence of such
damage. In the event Landlord elects to give such notice of Landlord's
intention to cancel and terminate this Lease, Tenant shall have the right
within ten (10) days after the receipt of such notice to give written notice
to Landlord of Tenant's intention to repair such damage at Tenant's expense,
without reimbursement from Landlord, in which event this Lease shall continue
in full force and effect, and Tenant shall proceed to make ch suchnotir epairswithias
such
soon as reasonably possible. If Tenant
does
andnot
terminated as of the date of
10 -day period this Lease shall be cancel
the occurrence of such damage.
9.4 Tonal Destruction. If during the term of this Lease there is
damage, whether or not an Insured Loss, (including destruction required by any
authorized public authority), which falls into the classification of Premises
Total Destruction or Premises Building Total Destruction, this Lease shall
automatically terminate as of the date of such total destruction unless Tenant
continues to pay rent as it comes due and without reduction and, within sixty
(60) days of such date, gives Landlord written notice of its
to
continue the Lease and fully repair and restore the Premises and thereafter
promptly commences and pursues such repair and restoration to completion.
9.5 Damage Near End of Term.
(a) If at any time during the last one hundred eighty (1 80) days
of the term of this Lease there is damage, whether or not a
which falls within the classification of Premises Partial Damage,Landlord may
at Landlord's option cancel and terminate this Lease
toas of the date of
Tenant of Landlord's
occurrence of such damage by giving written notice
election to do so within 30 days after the date of occurrence of such damage.
(b) Notwithstanding paragraph 9.5(a), in the event that
ich sTenant
aid has
an option to extend or renew this Lease,
time
exercise such option, if it
ion
may be exercised has not yet expired, Tenant shall
is to be exercised at all, no later than thirty (30) days after
the occurrence
of an Insured Loss falling within the hlatermioftion thisoLease. If Tenant duly
tial
Damage during the last six months of the Landlord shall, at
exercises such option during said thirty (30) ds as possible and this
Landlord's expense, repair such damage as soona
Lease shall continue in full force and effect. If Tenant fails toexercise
such option during said thirty (30) day periods
then
as ofLandlord
expiration of said
Landlord's option terminate and cancel this Lease
thirty (30) day period by giving written notice to Tenantof Landlord's day
election to do so within 10 days after the expiration of said
thirty period, notwithstanding any term or provision in the grant of option to the
contrary.
9.6 Abatement of Rent: Tenant's Remedies.
(a) In the event of damage described in paragraphs 9.2 or9.3,a provisions
Landlord or Tenant repairs or restores the Premises pursuant to pr
of this paragraph 9, the rent payable hereunder for the period duringg which
to
such damage, repair or restoration contiPremisesues shall
isbe abated nimpaired. Except for
oportion
the degree to which Tenant's use of the
abatement of rent, if any, Tenant shall have no claim against Landlord for any
damage suffered by reason of any such damage, destruction, rep
air or
restoration. Notwithstanding anything in the foregoing to the contrary,
Landlord shall not be exempt from liability for claims resulting exclusively
from the sole negligence of Landlord, its employees, agents and contractors.
(b) In the event that Landlord is obligated to
repaior restorer
the Premises under the provisions of tfparagraph
thet Landlord damage, an estimated
to Tenant, within 45 days after the occurrence
cost and completion schedule of such repairs. Within 15da s following its ien
receipt of said schedule, Tenant shall deliver to Landlord
notice to proceed with the repairs or (ii) a written notice of Tenant's intent
to effect such repairs by engaging a contractor acceptable to Landlord, at
Landlord's sole cost not to exceed the estimated cost set forth in Landlord's
statement.
9.7 Termination --Advance Payments. Upon termination of this Lease
pursuant to this paragraph 9, an equitable adjustment shall be made concerning
advance rent and any advance payments made by Tenant to Landlorda
nd
accordance with Section 1950.7 of the Civil Cod
9.8 Waiver. Landlord and Tenant waive the provisions of any is statutes
which relate to termination of leases when `sed termoofrthis Lease. destroyed
agree that such event shall be governed by the s
10. Real Property Taxes.
10.1 Payment of Taxes. Landlord shall forward to Tenant, upon request
therefor, copies of all real property tax bills and assessments levied against
the Premises. Tenant shall pay the real property tax, as defined
in
- 10 -
paragraph 10.2, applicable to the Premises during the term of this Lease. All
such payments shall be made to Landlord, in monthly
installments with
Tenant's
payment of Base Rent, or at Landlord's option, within
receipt of a billing therefor. If any such taxes paid bn of heTenant
term hshall
cover
any period of time prior to or aftebeteeuitablatp�orated to cover only the
Tenant's share of such taxes shall equitably
period of time within the tax fiscal year during which this Lease shall be in
effect and only the Premises and the proportion of common area provided in
paragraph 48.3.
10.2 Definition of "Real Property ax". As used herein, the term "real
property tax" shall not include any assessment, tax, fee or charge imposed on
the Premises, or on the real property of which the Premises are a part, by the
City of Tustin or the City of Tustin's Community Redevelopment Agency after
the date of this Lease, which assessment, tax, fee or charge relates to the
development, improvement or mitigation thereof of the Pacific Center East
Project. As used herein, the term "real property tax" shall include any form
of real estate tax or assessment, general, special, ordinary or extraordinary,
and any license fee, commercial rental tax, improvement bond or bonds, levy or
tax (other than inheritance, personal income or estate taxes) imposed on the
Premises by any authority having the direct or indirect power to tax,
including any city, state, county or federal government, or any school,
agricultural, sanitary, fire, street, drainage or other improvement district
thereof, as against any legal or equitable interest of Landlord in the
Premises or in the real property of which the Premises are a part, as against
Landlord's right to rent or other income therefrom, and as against Landlord's
business of leasing the Premises. The term real property tax" shall also
include any tax, fee, levy, assessment or charge (i) in substitution of,
partially or totally, any tax, fee, levy, assessment or charge hereinabove
included within the definition of "real property tax," or (ii) the nature of
which was hereinbefore included within the definition of "real property tax,"
or (iii) which is imposed as a result of a transfer, either partial or total,
of Landlord's interest in the Premises or which is added to a tax or charge
hereinbefore included within the definition of real property tax by reason of
such transfer, or (iv) which is imposed by reason of this transaction, any
modifications or changes hereto, or any transfers hereof.
10.3 Joint Assessment. If the Premises are not separately assessed,
Tenant's liability shall be an equitable proportion of the real property taxes
for all of the land and improvements included within the tax parcel assessed,
such proportion to be determined by Landlord from therespective
valuationsas
assigned in the assessor's woheeasonablesuch
determination thereof, in good
reasonably available. Landlord's
faith, shall be conclusive.
10.4 Personal Property Taxes.
(a) Tenant shall pay prior to delinquency all taxes assessed
against and levied upon trade fixtures, furnishings, equipment and all other
personal property of Tenant contained in the Premises or elsewhere. When
possible, Tenant shall cause said trade fixtures, furnishings, equipment and
all other personal property to be assessed and billed separately from the real
property of Landlord.
(b) If any of Tenant's said personal property
shall be assessed
with Landlord's real property, Tenant spay Landlord
the a written statement
es
attributable to Tenant within 10 days after Ptof
setting forth the taxes applicable to Tenant's property.
- 11 -
11. Utilities. Tenant shall pay for all water, gas, heat, light, power,
telephone and other utilities and services supplied to the Premises, together
with any taxes thereon. If any such services are not separately metered to
Tenant, Tenant shall pay a proportion of all charges jointly metered with
other premises to be determined in Landlords reasonable discretion based upon
estimated usage.
12. Assignment and Subletting.
12.1 Consent of Landlord. Tenant shall not assign, transfer, mortgage,
sublet, or otherwise transfer or encumber all or any part of Tenant's interest
in this Lease or in the Premises without Landlord's prior written consent,
which shall not be unreasonably withheld.
12.2 No Release of Tenant. Regardless of Landlord's consent, no
subletting or assignment shall release Tenant of its obligation or alter the
primary liability of Tenant to pay the rent and to perform all other
obligations to be performed by Tenant hereunder. The acceptance of rent by
Landlord from any other person shall not be deemed to be a waiver by Landlord
of any provision hereof. In the event of default by any assignee of Tenant or
any successor of Tenant, in the performance of any of the terms hereof,
Landlord may proceed directly against Tenant without the necessity of
exhausting remedies against said assignee.
12.3 Tenant to Keep Sublease Profits. If Tenant subleases the Premises
pursuant to the provisions of this paragraph 12, provided Tenant is not in
default under this Lease, it shall be entitled to all profits from said
sublease.
13. Defaults: Remedies.
13.1 Defaults. The occurrence of any one or more of the following
events shall constitute a material default and breach of this Lease by Tenant:
(a) The vacating or abandonment of the Premises by Tenant.
(b) The failure by Tenant to make any payment of rent or any other
payment required to be made by Tenant hereunder, as and when due, where such
failure shall continue for a period of seven (7) business days after written
notice thereof from Landlord to Tenant. In the event that Landlord serves
Tenant with a Notice to Pay Rent or Quit pursuant to applicable Unlawful
Detainer statutes such Notice to Pay Rent or Quit shall also constitute the
notice required by this subparagraph.
(c) The failure by Tenant to observe or perform any of the
covenants, conditions or provisions of this Lease to be observed or performed
by Tenant, other than described in paragraph (b) above, where such failure
shall continue for a period of 30 days after written notice thereof from
Landlord to Tenant; provided, however, that if the nature of Tenant's default
is such that more than 30 days are reasonably required for its cure, then
Tenant shall not be deemed to be in default if Tenant commences such cure
within said 30 -day period and thereafter diligently prosecutes such cure to
completion.
- 12 -
(d) (i) The making by Tenant of any general arrangement or
assignment for the benefit of creditors; (ii) Tenant becomes a "debtor" as
defined in 11 U.S.C. Section 101 or any successor statute thereto (unless, in
the case of a petition filed against Tenant, the same is dismissed within
60 days), (iii) the appointment of a trustee or receiver to take possession of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where possession is not restored to Tenant within
30 days; or (iv) the attachment, execution or other judicial seizure of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where such seizure is not discharged within 30 days.
Provided, however, in the event that any provision of this paragraph 13.1(d)
is contrary to any applicable law, such provision shall be of no force or
effect.
(e) The discovery by Landlord that any financial statement given
to Landlord by Tenant, any assignee of Tenant, any successor-in-interest of
Tenant or any guarantor of Tenant's obligation hereunder, and any of them, was
materially false.
13.2 Remedies. In the event of any such material default or breach by
Tenant, Landlord may at any time thereafter, with or without further notice or
demand and without limiting Landlord in the exercise of any right or remedy
which Landlord may have by reason of such default or breach:
(a) Terminate Tenant's right to possession of the Premises by any
lawful means, in which case this Lease shall terminate and Tenant shall
immediately surrender possession of the Premises to Landlord. In such event
Landlord shall be entitle;: to recover from Tenant all damages incurred by
Landlord by reason of Tenant's default including, but not limited to, the cost
of recovering possession of the Premises; expenses of reletting, including
necessary renovation and alteration of the Premises, reasonable attorney's
fees, and any real estate commission actually paid; the worth at the time of
award by the court having jurisdiction thereof cf the amount by which the
unpaid rent for the balance of the term after the time of such award exceeds
the amount of such rental loss �"or the same period that Tenant proves could be
reasonably avoided; and that portion of the leasing commission paid by
Landlord pursuant to paragraph 15 applicable to the unexpired term of this
Lease.
(b) Maintain Tenant's right to possession in which case this Lease
shall continue in effect whether or not Tenant shall have abandoned the
Premises. In such event Landlord shall be entitled to enforce all of
Landlord's rights and remedies under this Lease, including the right to
recover the rent as it becomes due hereunder.
(c) Pursue any other remedy now or hereafter available to Landlord
under the laws or judicial decisions of the state wherein the Premises are
located. Unpaid installments of rent and other unpaid monetary obligations of
Tenant under the terms of this Lease shall bear interest from the date due at
the maximum rate then allowable by law.
- 13 -
13.3 Default by Landlord. Landlord shall not be in default unless
Landlord fails to perforim obligations required of Landlord within a reasonable
time, but in no event later than thirty (30) days after written notice by
Tenant to Landlord specifying the nature of the failure to perform an
obligation; provided, however, that if the nature of Landlord's obligation is
such that more than thirty (30) days are required for performance then
Landlord shall not be in default if Landlord commences performance within
such 30 -day period and thereafter diligently prosecutes the same to completion.
13.4 Late Charges. Tenant hereby acknowledges that late payment by
Tenant to Landlord of rent and other sums due hereunder will cause Landlord to
incur costs not contemplated by this Lease, the exact amount of which will be
extremely difficult to ascertain. Such costs include, but are not limited to
processing and accounting charges, and late charges which may be imposed on
Landlord by the terms of any mortgage or trust deed covering the Premises.
Accordingly, if any installment of rent or any other sum due from Tenant shall
not be received by Landlord or Landlord's designee within fifteen (15) days
after such amount shall be due, then, without any requirement for notice to
Tenant, Tenant shall pay to Landlord a late charge equal to 10% of such
overdue amount. The parties hereby agree that such late charge represents a
fair and reasonable estimate of the costs Landlord will incur by reason of
late payment by Tenant. Acceptance of such late charge by Landlord shall in
no event constitute a waiver of Tenant's default with respect to such overdue
amount, nor prevent Landlord from exercising any of the other rights and
remedies granted hereunder. In the event that a late charge is payable
hereunder, whether or not collected, for three (3) consecutive installments of
rent, then rent shall automatically become due and payable quarterly in
advance rather than monthly, notwithstanding paragraph 4 or any other
provision of this Lease to the contrary.
13.5 Impounds. In the event that a late charge is payable hereunder,
whether or not collected, for three (3) consecutive installments of rent or
any other monetary obligation of Tenant under the terms of this Lease, Tenant
shall pay to Landlord, if Landlord shall so request, in addition to any other
payments required under this Lease, a monthly advance installment, payable at
the same time as the monthly rent, as estimated by Landlord, for real property
tax and insurance expenses on the Premises which are payable by Tenant under
the terms of this Lease. Such fund shall be established to insure payment
when due, before delinquency, of any or all such real property taxes and
insurance premiums. If the amounts paid to Landlord by Tenant under the
provisions of this paragraph are insufficient to discharge the obligations of
Tenant to pay such real property taxes and insurance premiums as the same
become due, Tenant shall pay to Landlord, upon Landlord's demand, such
additional sums necessary to pay such obligations. All moneys paid to
Landlord under this paragraph may be intermingled with other monies of
Landlord and shall r:ot bear interest. In the event of a default in the
obligations of Tenant to perform under this Lease, then any balance remaining
from funds paid to Landlord under the provisions of this paragraph may, at the
option of Landlord, be applied to the payment of any monetary default of
Tenant in lieu of being applied to the payment of real property tax and
insurance premiums.
- 14 -
14. Condemnation. If any part of the Premises shall be taken or condemned
for a public or quasi -public use, and a part thereof remains which is capable
of occupancy, this Lease shall, as to the part so taken, terminate as of the
date title shall vest in the condemnor, and the rent payable hereunder shall
be adjusted so that the Tenant shall be required to pay for the remainder of
the Term only such portion of such rent as the number of square feet in the
part remaining after the condemnation bears to the number of square feet in
the entire Premises at the date of condemnation; but in such event Landlord
shall have the option to terminate this Lease as of the date when title to the
part so condemned vests in the condemnor. If all the Premises or such part
thereof be taken or condemned so that there does not remain a portion capable
of occupancy hereunder, this Lease shall thereupon terminate. If a part or
all of the Premises be taken or condemned, all compensation awarded upon such
condemnation or taking shall go to the Landlord and the Tenant shall have no
claim thereto, and Tenant hereby irrevocably assigns and transfers to Landlord
any right to compensation or damages to which Tenant may be entitled during
the Term of this Lease by reason of the condemnation of all or part of the
Premises.
15. Broker's Fee. Tenant and Landlord represent that they have not engaged
nor are they aware of any person entitled to any brokerage commission or
finder's fee in connection with this Lease transaction excepting only Coldwell
Banker by Landlord and Daum by Tenant. Tenant agrees to indemnify and hold
Landlord harmless from any claims or liability, including reasonable
attorneys' fees, in connection with a claim by any person for a real estate
broker's commission, finder's fee or other compensation based upon any
statement, representation or agreement of Tenant, and Landlord agrees to
indemnify and hold Tenant harmless from any such claims or liability,
including reasonable attorneys' fees, based upon any statement, representation
or agreement of Landlord.
16. EstoDgel Certificate.
(a) Tenant shall at any time upon not less than ten (10) days
prior written notice from Landlord execute, acknowledge and deliver to
Landlord and to any prospective purchaser or encumbrancer of the Premises
designated by Landlord a statement in writing (i) stating the commencement
date of the term of this Lease, (ii) certifying that this Lease is unmodified
and in full force and effect (or, if modified, stating the nature of such
modification and certifying that this Lease, as so modified, is in full force
and effect), (iii) stating the date to which the rent and other charges are
paid in advance, if any, (iv) acknowledging that there are not, to Tenant's
knowledge, any uncured defaults on the part of Landlord hereunder, or
specifying such defaults if any are claimed, and (v) setting forth such other
matters as may reasonably be requested. Any such statement may be
conclusively relied upon by any prospective purchaser or encumbrancer of the
Premises.
(b) At Landlord's option, Tenant's failure to deliver such
statement within such time shall be a material breach of this Lease or shall
be conclusive upon Tenant (i) that this Lease is in full force and effect,
- 15 -
without modification except as may be represented by Landlord, (ii) that there
are no uncured defaults in Landlord's performance and (iii) that not more than
one month's rent has been paid in advance.
(c) If Landlord desires to finance, refinance, or sell the
Premises, or any part thereof, Tenant hereby agrees to deliver to any lender
or purchaser designated by Landlord financial statements of Tenant which may
be required by the lender or purchaser. Such statements shall include the
past three years' financial statements of Tenant. All such financial
statements shall be received by Landlord and such lender or purchaser in
confidence and shall be used only for the purposes herein set forth.
17. Landlord's Liability. The term "Landlord" as used herein shall mean only
the owner or owners at the time in question of the fee title or a lessee's
interest in a ground lease of the Premises, and in the event of any transfer
of such title or interest, Landlord herein named (and in case of any
subsequent transfers then the grantor) shall be relieved from and after the
date of such transfer of all liability as respects Landlord's obligations
thereafter to be performed, provided that any funds in the hands of Landlord
or the then grantor at the time of such transfer, in which Tenant has an
interest shall be delivered to the grantee. The obligations contained in
this Lease to be performed by Landlord shall, subject as aforesaid, be binding
on Landlord's successors and assigns, only during their respective periods of
ownership.
18. Severability. The invalidity of any provision of this Lease as
determined by a court of competent jurisdiction, shall in no way affect the
validity of any other provision hereof.
19. Interest on Past -due Obligations. Except as expressly herein provided,
any amount due to Landlord not paid when due shall bear interest at the
maximum rate then allowable by law from the date due. Payment of such
interest shall not excuse or cure any default by Tenant under this Lease,
provided, however, that interest shall not be payable on late charges incurred
by Tenant nor on any amounts upon which late charges are paid by Tenant.
20. Time of Essence. Time is of the essence.
21. Additional Rent. Any monetary obligations of Tenant to Landlord under
the terms of this Lease shall be deemed to be rent.
22. Incorporation of Prior Agreements; Amendments. This Lease contains all
agreements of the parties with respect to any matter mentioned herein. No
prior agreement or understanding pertaining to any such matter shall be
effective. This Lease may be modified in writing only, signed by the parties
in interest at the time of the modification. Except as otherwise stated in
this Lease, Tenant hereby acknowledges that neither the real estate broker
listed in paragraph 15 hereof nor any cooperating broker on this transaction
nor the Landlord or any employees or agents of any of said persons has made
any oral or written warranties or representations to Tenant relative to the
condition or use by Tenant of said Premises and Tenant acknowledges that
Tenant assumes all responsibility regarding the Occupational Safety Health
Act, the legal use and adaptability of the Premises and the compliance thereof
with all applicable laws and regulations in effect during the term of this
Lease except as otherwise specifically stated in this Lease.
- 16 -
23. Notices. Any notice required or permitted to be given hereunder shall be
in writing and may be given by personal delivery or by certified mail, and if
given personally or by mail, shall be deemed sufficiently given if addressed
to Tenant or to Landlord at the address noted below the signature of the
respective parties, as the case may be. Either party may by notice to the
other specify a different address for notice purposes except that upon
Tenant's taking possession of the Premises, the Premises shall constitute
Tenant's address for notice purposes. A copy of all notices required or
permitted to be given to Landlord hereunder shall be concurrently transmitted
to such party or parties at such addresses as Landlord may from time to time
hereafter designate by notice to Tenant. Any notice sent by mail shall be
deemed received two (2) business days after it is sent.
24. Waivers. No waiver by either party of any provision hereof shall be
deemed a waiver of any other provision hereof or of any subsequent breach of
the same or any other provision. Landlord's consent to, or approval of, any
act shall not be deemed to render unnecessary the obtaining of Landlord's
consent to or approval of any subsequent act by Tenant. The acceptance of
rent hereunder by Landlord shall not be a waiver of any preceding breach by
Tenant of any provision hereof, other than the failure of Tenant to pay the
particular rent so accepted, regardless of Landlord's knowledge of such
preceding breach at the time of acceptance of such rent.
25. Recording. Landlord or Tenant shall upon request execute and may cause
to be recorded a memorandum of this Lease.
26. Holding Over - Lease Term Partial Extension. If Tenant remains in
possession of the Premises or any part thereof after the expiration of the
term hereof, such occupancy shall be a tenancy from month to month upon all
the provisions of this Lease pertaining to the obligations of Tenant, but all
options and rights of first refusal, if any, granted under the terms of this
Lease shall be deemed terminated and be of no further effect during said month
to month tenancy. Rent for any such month to month tenancy shall be at the
rate of .80¢ per square foot NNN for the first four (4) months and thereafter
150% of the previous months monthly rent.
27. Cumulative Remedies. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other remedies
at law or in equity.
28. Covenants and Conditions. Each provision of this Lease performable by
Tenant shall be deemed both a covenant and a condition.
29. Binding Effect; Choice of Law. Subject to any provisions hereof
restricting assignment or subletting by Tenant and subject to the provisions
of paragraph 17, this Lease shall bind the parties, their personal representa-
tives, successors and assigns. This Lease shall be governed by the laws of
the State of California.
30. Subordination.
(a) This Lease, at Landlord's option, shall be subordinate to any
ground lease, mortgage, deed of trust, or any other hypothecation or security
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now or hereafter placed upon the real property of which the Premises are a
-- part and to any and all advances made on the security thereof and to all
renewals, modifications, consolidations, replacements and extensions thereof.
Notwithstanding such subordination, Tenant's right to quiet possession of the
Premises shall not be disturbed if Tenant is not in default and so long as
Tenant shall pay the rent and observe and perform all of the provisions of
this Lease, unless this Lease is otherwise terminated pursuant to its terms.
If any mortgagee, trustee or ground lessor shall elect to have this Lease made
prior to the lien of its mortgage, deed of trust or ground lease, and shall
give written notice thereof to Tenant, this Lease shall be deemed to be prior
to such mortgage, deed of trust, or ground lease, whether this Lease is dated
prior or subsequent to the date of said mortgage, deed of trust or ground
lease or the date of recording thereof.
(b) Tenant agrees to execute any documents required to effectuate
an attornment, a subordination or to make this Lease prior to the lien of any
mortgage, deed of trust or ground lease, as the case may be. Tenant's failure
to execute such documents within 10 days after written demand shall constitute
a material breach and shall be conclusive upon Tenant that this Lease is
subordinated to the lien of any such mortgage, deed of trust or ground lease.
31. Attorney's Fees. If either party brings an action to enforce the terms
hereof or declare rights hereunder, the prevailing party in any such action,
on trial or appeal, shall be entitled to its reasonable attorney's fees to be
paid by the losing party as fixed by the court.
32. Landlord's Access. Landlord and Landlord's agents shall have the right
to enter the Premises at reasonable.times for the purpose of inspecting the
same, showing the same to prospective purchasers, lenders, or lessees, and
making such alterations, repairs, improvements or additions to the Premises or
to the building of which they are a part as Landlord may deem necessary or
desirable. Landlord may at any time place on or about the Premises any
ordinary and usual "For Sale" signs and Landlord may at any time during the
last 120 days of the term hereof place on or about the Premises any ordinary
"For Lease" signs, all without rebate of rent or liability to Tenant.
33. Auctions. Tenant shall not conduct, nor permit to be conducted, either
voluntarily or involuntarily, any auction upon the Premises without first
having obtained Landlord's prior written consent.
34. Signs. Tenant shall not place any sign upon the Premises or the Building
or the roof of the Building without Landlord's prior written consent.
(a) Upon prior written approval of Landlord and in accordance with
any applicable ordinance or regulation of the City of Tustin, Tenant shall be
permitted to install exterior building signage located between the first and
second floor. Drawings, specifications and location of this signage must be
approved by the City and Landlord prior to installation. The cost of such
sign, including permits, fees, construction and installation costs, shall be
the sole expense of Tenant.
(b) Tenant shall be responsible for the installation and
maintenance of its sign. Should Tenant fail to perform any required
maintenance or repair, within thirty (30) days following receipt of written
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notice from Landlord to effect said maintenance or repair, Landlord shall have
the right (but shall not be obligated to) undertake repairs and Tenant shall
reimburse Landlord for the cost thereof within ten (10) days from receipt of
invoice.
(c) Upon the expiration
thereof, Tenant shall be required to
and facia and paint the patched area
of this Lease, or any sooner termination
remove its signage and patch the canopy
to match the surrounding Building area.
35. Merger. The voluntary or other surrender of this Lease by Tenant, or a
mutual cancellation thereof, or a termination by Landlord, shall not work a
merger, and shall, at the option of Landlord, terminate all or any exiting
subtenancies or may, at the option of Landlord, operate as an assignment to
Landlord of any or all of such subtenancies.
36. Consents. Wherever in this Lease the consent of one party is required to
an act of the other party, such consent shall not be unreasonably withheld.
37. Quiet Possession. Upon Tenant paying the rent for the Premises and
observing and performing all of the covenants, conditions and provisions on
Tenant's part to be observed and performed hereunder, Tenant shall have quiet
possession of the Premises for the entire term hereof subject to all of the
provisions of this Lease. The individuals executing this Lease on behalf of
Landlord represent and warrant to Tenant that they are fully authorized and
legally capable of executing this Lease on behalf of Landlord and that such
execution is binding upon all parties holding an ownership interest in the
Premises.
38. Security Measures. Tenant hereby acknowledges that the rental payable tc
Landlord hereunder does not include the cost of guard service or other
security measures; and that Landlord shall have no obligation whatsoever to
provide same. Tenant assumes all responsibility for the protection of Tenant,
its agents and invitees from acts of third parties.
39. Easements. Landlord reserves to itself the right, from time to time, to
grant such easements, rights and dedications as Landlord deems necessary or
desirable, and to cause the recordation of Parcel Maps and restrictions, so
long as such easements, rights, dedications, Maps and restrictions do not
unreasonably interfere with the use of the Premises by Tenant. Tenant shall
sign any of the aforementioned documents upon request of Landlord and failure
to do so shall constitute a material breach of this Lease.
40. Performance Under Protest. If at any time a dispute shall arise as to
any amount or sum of money to be paid by one party to the other under the
provisions hereof, the party against whom the obligation to pay the money is
asserted shall have the right to make payment "under protest" and such payment
shall not be regarded as a voluntary payment, and there shall survive the
right on the part of said party to institute suit for recovery of such sum.
If it shall be adjudged that there was no legal obligation on the part of said
party to pay such sum or any part thereof, said party shall be entitled to
recover such sum or so much thereof as it was not legally required to pay
under the provisions of this Lease.
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41. Authority. Each individual executing this Lease on behalf of Tenant
represents and warrants that he or she is duly authorized to execute and
deliver this Lease on behalf of said entity. Tenant shall, within thirty (30)
days after execution of this Lease, deliver to Landlord evidence of such
authority satisfactory to Landlord.
42. Financial Statements. If Landlord desires to finance, refinance or sell
the Premises, or any part thereof, Tenant hereby agrees to deliver to any
lender or purchaser designated by Landlord such existing financial statements
of Tenant as may be reasonably requested in writing by such lender or
purchaser. Such statements shall include the past three years' financial
statements. All such financial statements shall be used only for the purposes
herein set forth. All financial statements required under this Lease shall be
delivered to Landlord or any lender, as applicable, within thirty (30) days of
Landlord's written request therefore. At Landlord's option, Tenant's failure
to deliver those statements within that time shall be a breach of this Lease.
43. Landlord's Work.
(a) Landlord shall construct or cause to be constructed in and to
the Premises, at Landlord's cost not to exceed $150,000 (the "T.I.
Allowance"), certain tenant improvements, including space planning, permits
and related costs (the "Landlord's Work"), in accordance with Landlord's
building standard, and substantially in accordance with the space plan (the
"Space Plan") attached hereto, marked Exhibit "D" and made a part hereof. If
said Exhibit is not attached, the Space Plan shall be prepared by Landlord and
submitted to Tenant for approval, which approval shall be given within ten
(10) business days following receipt thereof, and evidenced by Tenant's
signature thereon. Any failure by Tenant to respond within said ten (10)
business day period shall not delay what would otherwise have been the
Commencement Date. Upon approval by both parties, the Space Plan shall be
deemed incorporated herein by reference, although not attached hereto.
(b) The T.I. Allowance shall be used to pay for costs approved by
Landlord and associated with the design, permit process and construction of
Landlord's Work, including but not limited to, architect's fees, plan check
and permit fees, fees for utility and telephone service hook-ups. Any tenant
improvements which Landlord, in its sole discretion, considers specialized,
shall not be covered by the T.I. Allowance and shall be paid in cash by Tenant
directly to Landlord's tenant improvement contractor. In no event shall the
T.I. Allowance be expended for Tenant's equipment, trade fixtures, or alarm
system except that Tenant may use any unused T.I. Allowance to cover the cost
of a Hewlett Packard cable site for cabling the Premises, which improvement
may, at Landlord's sole discretion, remain as a part of the Premises upon
termination of this Lease.
(c) If the actual cost of Landlord's Work exceeds the T.I.
Allowance, for any reason, including without limitation, (i) changes required
by the City, or other local, state or federal governmental agency having
jurisdiction, (ii) events or conditions beyond Landlord's control, or (iii)
changes requested by Tenant to the Space Plan, working drawings or otherwise,
Tenant shall promptly upon notice from Landlord either pay the entire amount
- 20 -
of such excess cost or approve modifications to the Space Plan or working
drawings to reduce the cost thereof by an amount equal to all or a part of
such excess and pay any excess remaining after such reduction. Any unused
portion of the T.I. Allowance shall belong solely to Landlord and Tenant shall
have no right or claim thereto. Landlord shall endeavor to notify Tenant as
soon as reasonably possible if and when it learns that the actual cost of
construction exceeds the T.I. allowance.
(d) In the event that Tenant requests any change in the Space
Plan, or working drawings, or otherwise, which in Landlord's opinion is
reasonable and practicable, then Landlord shall cause such changes to be
effected upon the following conditions: Tenant shall pay in cash and in
advance the sum of (i) the increase in the architect's and/or space planner's
fees caused by such changes and (ii) the actual increase in construction cost
caused by such change, and Tenant consents to any delay in completion of the
Landlord's Work caused by such change.
44. Parking.
(a) Tenant shall have the right to use in common with other
tenants and occupants of the Building, and subject to such rules and
regulations, as may be established or altered by Landlord or its agent from
time to time, parking facilities which Landlord shall furnish as part of the
common areas. Tenant shall have the right to use, free of charge, a maximum
of 82 undesignated parking spaces. Tenant shall also be entitled to use an
additional 15 parking spaces which shall be reserved for Tenant's car pool
parking only. Landlord shall, at Tenant's expense, mark and identify, such
spaces for car pool use.
(b) Landlord shall permit Tenant, at Tenant's expense, to install
a bicycle rack at a mutually agreed upon location.
45. Force Majeure - Unavoidable Delays. In the event that the performance of
any act required by this Lease to be performed by either Landlord or Tenant be
prevented or delayed by reason of an act of God, strike, lockout, labor
troubles, inability to secure materials, restrictive governmental laws or
regulations, inclement weather, or any other cause (except financial
inability) beyond the reasonable control of such party, the time for
performance of the act will be extended for a period equivalent to the period
of delay and performance of the act during the period of delay will be
excused; provided, however, that nothing contained in this section shall
excuse the prompt payment of rent by Tenant as required by this Lease or the
performance of any act rendered difficult solely because of the financial
condition of the party, Landlord or Tenant, required to perform the act.
46. CC&R's. At any time during the term of this Lease, Landlord may cause to
be recorded reasonable Conditions, Covenants and Restrictions ("CC&R's")
pertaining to the use and occupancy of the Premises. Tenant shall be subject
to and shall comply with such reasonable CC&R's and shall execute any further
instrument reasonably required to subordinate the Lease thereto.
- 21 -
47. Hazardous Materials; Environm
(a) Tenant shall not cause or permit any Hazardous Material
(hereinafter defined) to be brought upon, generated, stored, used, handled or
disposed of in, on, under or about the Premises except such Hazardous Material
as is necessary for Tenant's business and will be used, handled, stored and
disposed of in a r:-nner that complies with all laws regulating such Hazardous
Material and disclosed in accordance with the provisions hereof.
(b) At the commencement of the term of this Lease, and on or
before January 15 of each year thereafter ("DisclL;sure Dates"), including the
year after the termination of this Lease, Tenant shall disclose to Landlord in
writing the names and amounts of all Hazardous Materials, which were
generated, stored, used or disposed of in, on, or about the Premises prior to
the Disclosure Date, or which Tenant intends to generate, store, use or
dispose of in, on or about the Premises, for the year prior to and after each
Disclosure Date. Tenant shall immediately notify Landlord in writing of, and
provide Landlord a copy of, any notices of violation or investigation received
by Tenant from any governmental agency pertaining to Hazardous Materials.
(c) As used herein, the term "Hazardous Material" means any
hazardous or toxic substance, material or waste, which if discharged, leaked
or emitted into the atmosphere, the ground, or any body of water, does or may
pollute or contaminate the same, or adversely affect (i) the health or safety
of persons, whether on the Premises or elsewhere, (ii) the condition, use or
enjoyment of the Premises or any other real or personal property, whether on
the Premises or elsewhere, or (iii) the Premises or any of the improvements
thereto or thereon, including, but not limited to, substances, materials, and
wastes now or hereafter regulated by any local governmental authority, the
State of California or any federal agency. Tenant understands that the
following are included among the substances that may be subject to these
provisions: paint and solvents, petroleum-based fuels and products, lead,
cyanide, DDT, printing inks, acids, pesticides, ammonium compounds, PCBs and
asbestos.
(d) If the presence of any Hazardous Material in, on or about the
Premises caused or permitted by Tenant results in any contamination of the
Premises, Tenant shall promptly, with Landlord's prior approval, 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. Landlord's approval of such actions 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.
(e) From time to time, upon Landlord's request, Tenant shall
deliver to Landlord, in writing and in a form satisfactory to Landlord,
evidence of its compliance with the provisions of this paragraph 47. In any
event, Tenant shall allow Landlord to enter upon the Premises at reasonable
times for the purpose of inspection and/or testing.
(f) If Tenant breaches the obligations stated in the preceding
paragraphs, or if the presence of Hazardous Material on the Premises caused or
permitted by Tenant results in contamination of the Premises, or if
- 22 -
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 harmless from any and all
claims, liabilities, judgments, damages, penalties, fines, costs, and losses
(including, without limitation, diminution in value of the Premises, damages
for the loss of or restriction on use of rentable or usable space or of any
amenity of the Premises, damages arising from any adverse impact on marketing
of space, and sums paid in settlement of claims, attorneys' fees, consultant
fees and expert fees) which arise during or after the lease 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 clean-up, remedial, removal or restoration work deemed
necessary by Landlord or required by any federal, state or local governmental
agency or political subdivision because of Hazardous Material present in the
soil or groundwater on or under the Premises.
48. Common Areas. The common areas of the property, consisting of the
parking areas, walkways, driveways, landscaped areas, lobbies, stairwells,
elevators, corridors, restrooms and all other areas except the Premises and
other leased area of the Building, as shown on Exhibits "A-111, "A-2" and A-3"
hereto, shall be for the joint use of all tenants, their licensees, customers,
invitees, suppliers, and employees. Landlord hereby grants to Tenant, and its
licensees, customers, invites, suppliers and employers, the non-exclusive
right of use of all of the common areas as they may from time to time exist.
48.1 _Landlord's Maintenance of Common Areas. Landlord shall keep and
maintain the common areas in good order, condition and repair at Landlord's
expense subject to reimbursement by Tenant of its pro rata share thereof as
provided in paragraph 48.3.
48.2 Control of Common Areas. Landlord shall have sole and exclusive
control of the common areas and shall have the right to:
(a) Establish and enforce reasonable rules and regulations
applicable to all tenants concerning the maintenance, management, use and
operation of the common areas;
(b) Close any of the common areas temporarily for maintenance
purposes, and as required in the opinion of Landlord's counsel to prevent a
dedication of any of the common areas or the accrual of any rights of any
person or of the public to the common areas;
(c) Determine the nature and extent of the common areas and make
such changes thereto as Landlord deems desirable including, without
limitation, changes in the location of driveways, entrances, exits, vehicular
parking spaces, parking area, or the direction of the flow of traffic;
(d) Select an independent operator to maintain and operate any of
the common areas if at any time Landlord determines that the best interests of
the tenants will be served by doing so. Landlord shall have the right to
negotiate and enter into a contract with such operator on such terms and
conditions and for such period of time as Landlord deems reasonable and proper
both as to service and as to cost.
- 23 -
48.3 Payment of Common Area Costs. Tenant shall pay to Landlord as
additional rent Tenant's pro rata share of the expenses incurred by Landlord for
r.aintenance and Dperation of the common areas, including without limitation,
costs of cleaning, sweeping, utilities, security systems, planting, landscaping,
purchase, construction and maintenance of refuse receptacles, lighting,,
installation of directional signs and markers, car stops, parking lot restriping,
sealing and repaving, insurance premiums, fire detectors and sprinkler systems,
real property taxes and assessments and an administrative fee equal to ten
percent (10%) of the total of such costs. Tenant's pro rata share shall be that
fractional part of the total of such costs which the square footage of the
Premises bears to the total square footage of gross leaseable space in the
Building as determined by Landlord. Landlord and Tenant agree that Tenant's pro
rata share upon commencement of the Lease is 41% and shall be adjusted from time
to time based on changes in the Tenant's square footage of leased Premises, and
changes in the rentable square footage in the Building and shall be payable in
the following manner:
(i) From and after the Commencement Date of the term of this Lease,
but subject to adjustment as provided below in subparagraph (ii), Tenant shall
pay to Landlord on or before the first (1st) day of each calendar month during
the term of this Lease, the amount billed to Tenant which amount shall be a
reasonable estimate of such expenses.
(ii) Within a reasonable time following the end of each calendar year
during the term of this Lease, Landlord shall furnish Tenant a statement covering
such calendar year just expired showing the actual expenses incurred in
connection with the common areas, the actual amount of Tenant's pro rata share
thereof, and the payments made by Tenant. Tenant shall promptly pay its pro rata
share of such expenses which exceed Tenant's payments theretofore made, and
Landlord shall apply the excess, if any, of Tenant's payment(s) to offset the
next following payment(s) for such expenses due to Landlord or, at Tenant's
request, shall refund the excess.
LANDLORD AND TENANT HAVE CAREFULLY
TERM AND PROVISION CONTAINED HEREIN AND,
INFORMED AND VOLUNTARY CONSENT THERETO.
TIME THIS LEASE IS EXECUTED, THE TERMS C
AND EFFECTUATE THE INTENT AND PURPOSE OF
PREMISES.
READ AND REVIEWED THIS LEASE AND EACH
BY EXECUTION OF THIS LEASE, SHOW THEIR
THE PARTIES HEREBY AGREE THAT, AT THE
F THIS LEASE ARE COMMERCIALLY REASONABLE
LANDLORD AND TENANT WITH RESPECT TO THE
IN WITNESS WHEREOF, the Tenant and the Landlord have signed this Lease as of
the date first above written.
CATELLUS DEVELOPMENT CORPORATION, TUSTIN COMMUNITY REDEVELOPMENT AGENCY
a Delaware corporation
1065 PacifiCenter Drive, Suite 200
Anaheim, CA 92806
Title:
- LANDLORC -
By:
Title:
- 24 -
- TENANT -
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EXHIBIT "A-1"
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EXHIBIT "A-3"