California-Irvine-3 Jenner Street Lease - Irvine Co. and Kofax Image Products Inc.
L E A S E
Between
THE IRVINE COMPANY
A Michigan Corporation
as Landlord
and
KoFAX IMAGE PRODUCTS, INC.
A California Corporation
as Tenant
for
3 JENNER STREET, SUITE 100
IRVINE, CALIFORNIA 92718
DUPLICATE
ORIGINAL
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TABLE OF CONTENTS
1. PARTIES.......................................................................... 1
2. PREMISES......................................................................... 1
3 DEFINITIONS...................................................................... 1
4 LEASE TERM....................................................................... 1
5. RENT............................................................................. 3
6 LATE PAYMENT CHARGES............................................................. 3
7. SECURITY DEPOSIT................................................................. 3
8 HOLDING OVER..................................................................... 3
9. CONDITION OF PREMISES............................................................ 3
10. USE OF THE PREMISES.............................................................. 3
11. QUIET ENJOYMENT.................................................................. 4
12. ALTERATIONS...................................................................... 4
13. SURRENDER OF THE PREMISES........................................................ 4
14. REAL AND PERSONAL PROPERTY TAXES................................................. 4
15. UTILITIES AND SERVICES........................................................... 5
16. OPERATING EXPENSES, REPAIRS, AND MAINTENANCE..................................... 5
17. FIXTURES......................................................................... 6
18. LANDLORD'S RIGHT TO ENTER THE PREMISES........................................... 6
19. SIGNS............................................................................ 6
20. INDEMNITY; INSURANCE............................................................. 6
21. WAIVER OF SUBROGATION............................................................ 7
22. DAMAGE OR DESTRUCTION............................................................ 7
23. CONDEMNATION..................................................................... 7
24. ASSIGNMENT AND SUBLETTING........................................................ 8
25. CONSTRUCTION OF TENANT IMPROVEMENTS.............................................. 8
26. DEFAULT.......................................................................... 9
27. SUBORDINATION.................................................................... 9
28. NOTICES.......................................................................... 9
29 ATTORNEY'S FEES.................................................................. 10
30. ESTOPPEL CERTIFICATE............................................................. 10
31. TRANSFER OF THE PREMISES BY LANDLORD............................................. 10
32. LANDLORD'S RIGHT TO PERFORM TENANT'S COVENANTS................................... 10
33. TENANT'S REMEDY.................................................................. 10
34. MORTGAGEE PROTECTION............................................................. 10
35. BROKERS.......................................................................... 10
36. EXAMINATION OF LEASE............................................................. 10
37. RECORDING........................................................................ 10
38. QUITCLAIM........................................................................ 10
39. MODIFICATIONS FOR LENDER......................................................... 10
40. PARKING AND USE OF COMMON AREAS AND FACILITIES................................... 10
41. GENERAL.......................................................................... 11
Exhibit A DESCRIPTION OF PREMISES......................................... 13
Exhibit B DESCRIPTION OF PROJECT.......................................... 14
Exhibit C SPACE PLAN...................................................... 15
Exhibit D COMMENCEMENT-DATE MEMORANDUM.................................... 16
Exhibit E RENT ADJUSTMENTS................................................ 17
Exhibit F COVENANTS, CONDITIONS, AND RESTRICTIONS......................... 18
Exhibit G RULES AND REGULATIONS........................................... 19
Rider No. 1 RENT WAIVER AGREEMENT........................................... 22
Rider No. 2 PROSPECTIVE EASEMENT, ACCESS, AND MAINTENANCE AGREEMENT......... 23
Rider No. 3 PARKING......................................................... 24
Rider No. 4 SIGNAGE......................................................... 25
Rider No. 5 PHASED USE OF PREMISES.......................................... 26
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STANDARD FORM LEASE
(MULTI-TENANT)
THE IRVINE COMPANY LANDLORD
KOFAX IMAGE PRODUCTS, INC. TENANT
Lease Summary:
(a) Lease Date: March 31, 1988
(b) Landlord: THE IRVINE COMPANY, A Michigan Corporation
(c) Address of Landlord: c/o THE SAMMIS COMPANY
17922 Fitch Ave., Irvine, CA 92714
(d) Tenant: KOFAX IMAGE PRODUCTS, INC.
(e) Address of Tenant: 3 Jenner Street, Suite 100, Irvine, CA 92718
(f) Contact: David Silver Telephone: (714) 474-1933
(g) Premises Square Footage: Approximately 19,635
(h) Building Address: 3 Jenner Street, Suite 100, Irvine, CA 92718
(i) Building Square Footage: Approximately 33,075 Square Feet
(j) Anticipated Commencement Date: July 1, 1988
(k) Term: Three (3) years and Two (2) months
(l) Monthly Rent: $16,174 (15,544 sq.ft.), $4,257 (4,091 sq.ft)/month
$245,172/year (subject to adjustment per Exhibit "E").
(m) Security Deposit: $22,474
(n) Permitted Uses: Administrative offices, light assembly, storage and other
lawful uses consistent with uses under the Rules and
Regulations (Exhibit G) and within the adjacent areas.
(o) Brokers: Richard Meyer - Daum Johnstown American
(p) Insuring Party: Landlord
(q) Tenant's Percentage: 13.51% of the 145,300 Sq. Ft. Project
Exhibit(s):
"A" Description of Premises
"B" Description of Project
"C" Tenant Improvements Preliminary Plans
"D" Commencement Date Memorandum
"E" Rent Adjustments
"F" Covenants, Conditions & Restrictions
"G" Rules and Regulations
Addendum
Rider No. 1 - Rent Waiver Agreement
Rider No. 2 - Prospective Reciprocal Easement, Access, and Maintenance
Agreement
Rider No. 3 - Parking
Rider No. 4 - Signage
Rider No. 5 - Phased Use of Premises
LEASE
1. PARTIES. THIS LEASE ("Lease"), is dated for reference purposes only as
of the date set forth in Paragraph (a) of the Lease Summary and is entered into
by and between the Landlord identified in Paragraph (b) of the Lease Summary
("Landlord"), whose address is set forth in Paragraph (c) of the Lease Summary
and the Tenant identified in Paragraph (d) of the Lease Summary ("Tenant"),
whose address is set forth in Paragraph (e) of the Lease Summary.
2. PREMISES. Landlord hereby leases to Tenant and Tenant hereby leases
from Landlord those certain premises ("Premises") within that certain building
located at the address set forth in Paragraph (h) of the Lease Summary, which
Premises are shown on Exhibit "A" attached hereto, together with the property
appurtenant thereto, if any, for the exclusive use of Tenant as shown on said
Exhibit "A".
3. DEFINITIONS. The following terms shall have the following meanings in
this Lease:
(a) "Alterations" shall mean any alterations, decorations, additions or
improvements made in, on or about, under or continuous to the Premises after the
Commencement Date, including, but not limited to, lighting, HVAC and electrical
fixtures, pipes and conduits, aboveground and below ground tanks, hazardous
transfer, storage and disposal facilities, partitioning, drapery, wall
coverings, cabinetry, carpeting and/or other floor covering, ceiling tile,
fixtures and carpentry installations.
(b) "Building" shall mean that certain building, identified in Paragraph
(h) of the Lease Summary, within which the Premises are located.
SEE EXHIBIT F
(d) "City" shall mean the city in which the Premises are located.
(e) "Commencement Date" shall mean the first day of the Term of this
Lease as described in Paragraph 4(a).
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(f) "Common Area" shall mean all areas and facilities within the
Project exclusive of the Premises and other portions of the Project leased (or
to be leased) exclusively to other tenants. The Common Area includes, but is not
limited to, striped parking areas, access and perimeter roads, sidewalks,
landscaped areas and similar areas and facilities. Tenant's use of the Common
Area, and its rights and obligations with respect thereto, are more
particularly described in Paragraph 40 hereof.
(g) "County" shall mean the county in which the Premises are located.
(h) "HVAC" shall mean the heating, ventilating and air conditioning
system serving the Building.
(i) "Interest Rate" shall mean the greater of ten percent (10%) per
annum or five percent (5%) in excess of the discount rates of the Federal
Reserve Bank of San Francisco in effect on the twenty-fifth (25th) day of the
calendar month immediately prior to the event giving rise to the Interest Rate
Imposition.
(j) "Landlord's Agents" shall mean Landlord's authorized agents,
contractors, partners, subsidiaries, directors, officers and employees.
(k) "Lease Summary" shall mean the above summary of Lease information
which is hereby made a part of this Lease.
(l) "Monthly Rent" shall mean the rent payable pursuant to Paragraph
5(a), as adjusted from time to time pursuant to the terms of this Lease.
(m) "Operating Expenses" shall mean all costs and expenses for the
maintenance and operation of the Project as more particularly described in
Paragraph 16(b) below.
(n) "Premises" shall mean the property leased hereby within the
Building, and all areas appurtenant thereto for the exclusive use of Tenant, as
shown on Exhibit "A" hereto.
(o) "Project" shall mean that certain real property, and all
improvements thereon, including the Building and other buildings, if any,
located within the boundaries of the property shown on the Project Site Plan
attached to the Lease as Exhibit "B".
(p) "REA" shall mean that certain Reciprocal Easement Agreement
executed by Landlord as Declarant on _________________________ and recorded in
the Official Records of Orange County, State of California on
__________________ as Instrument No. ________________, as the same may be
amended from time to time, a true, complete and correct copy of which has been
supplied by Landlord to Tenant. (SEE RIDER NO. 2).
(q) "Real Property Taxes" shall mean any form of tax, assessment,
license, fee, rent tax, levy, penalty (if a result of Tenant's delinquency),
real property or other tax (other than Landlord's net income, estate,
succession inheritance, or franchise taxes), now or hereafter imposed with
respect to the Premises, this Lease or any rent payable hereunder by any
authority having the direct or indirect power to tax, or by any city, county,
state or federal government or any improvement district or other district or
division thereof, whether such tax or any portion thereof: (i) is determined
by the area of the Premises or any part thereof or the rent and other sums
payable hereunder by Tenant including, but not limited to, any gross income or
excise tax levied by any of the foregoing authorities with respect to receipt of
such rent or other sums due under this Lease: (ii) is levied or assessed in
lieu of, in substitution for, or in addition to, existing or additional taxes
with respect to the Premises whether or not now customary or within the
contemplation of the parties: or (iii) is based upon any legal or equitable
interest of Landlord in the Premises or any part thereof.
(r) "Rent" shall mean Monthly Rent plus the Additional Rent defined in
Paragraph 5(c).
(s) "Security Deposit" shall mean that amount paid by Tenant pursuant
to Paragraph 7.
(t) "SLURS" shall mean that certain standards Declaration of Special
Land Use Restrictions [Any further reference herein to the SLURS shall be
deleted.]
(u) "Tenant Improvements" shall mean those certain improvements to the
Premises, if any, to be constructed pursuant to Paragraph 25 hereof.
(v) "Tenant's Personal Property" shall mean Tenant's removable trade
fixtures, furniture, equipment and other personal property in the Premises.
(w) "Term" shall mean that period of years and/or months as set forth
in Paragraph (k) of the Lease Summary, as said Term may be extended pursuant to
the proper exercise of any option or options to extend the Term as may be
granted herein or as may be sooner terminated pursuant to any provision hereof.
4. Lease Term.
(a) Term. The Term of this Lease shall be for that period of years
and months set forth in paragraph (k) of the Lease Summary commencing on the
Commencement Date, unless extended in accordance with any option or options to
extend the Term granted herein, or unless sooner terminated pursuant to any
provision hereof. Landlord and Tenant anticipate that the Term will commence
on the "Anticipated Commencement Date" set forth in Paragraph (j) of the Lease
Summary, however, notwithstanding the foregoing, the actual Commencement Date of
this Lease ("Commencement Date") shall be the earlier of: (i) the date upon
which the City has approved the Tenant Improvements (as defined in Paragraph 25
hereof) in accordance with its building code, as evidenced by its written
approval thereof in accordance with the building permits issued for such Tenant
Improvements; or (ii) the date Landlord's architect supervising the
construction of the Tenant Improvements has certified in writing that the
Tenant Improvements are substantially completed in accordance with the plans
and specifications therefore; or (iii) the date tenant commences occupancy of
the Premises. The Tenant Improvements shall be deemed "substantially complete"
when they have been completed except for minor details of construction,
mechanical adjustments or decorations which do not materially interfere with
Tenant's use and enjoyment of the Premises (items normally referred to as
"punch list" items). If the Commencement Date is based on the date established
by the provisions of Paragraph 4(a)(ii) above, Landlord shall deliver to Tenant
a certificate of occupancy from the City for the Premises within five (5)
business days of such date. When the actual Commencement Date has occurred,
Landlord and Tenant shall execute a Commencement Date Memorandum in the form
shown in Exhibit "D" attached to the Lease.
(b) Early Entry. Landlord hereby agrees that upon prior written notice
to Landlord, Tenant and its authorized agents, contractors, subcontractors and
employees may, during ordinary business hours prior to the Commencement Date,
at Tenant's sole risk, enter upon the Premises for the sole purpose of
installing Tenant's trade fixtures and equipment in the Premises; provided,
however, that (i) the provisions of this Lease, other than with respect to the
payment of Monthly Rent and items payable by Tenant and Additional Rent (other
than Tenant's insurance obligations as set forth in Paragraph 20 of the Lease),
shall apply during such early entry, specifically including, but not limited
to, the provisions of Paragraph 20(a) relating to the indemnification of
Landlord; (ii) Tenant shall pay for and provide evidence of the Insurance to be
provided by Tenant pursuant to the provisions of Paragraph 20 of the Lease;
(iii) Tenant shall pay all utility charges for the Premises attributable to
Tenant's early entry and use of the Premises as reasonably determined by
Landlord; and (iv) Tenant will not unreasonably interfere, delay or hinder
Landlord, its agents, contractors or subcontractors in the construction of the
Tenant improvements in accordance with the provisions of this Lease. Tenant
shall not use the Premises for the storage of inventory or otherwise commence
the operation of business during the period of such early entry. Early entry
under this Paragraph 4(b) shall not constitute occupancy of the Premises for
purposes of establishing the Commencement Date.
(c) Delay in Possession. Notwithstanding the Anticipated Commencement
Date, if for any reason Landlord cannot deliver possession of the Premises to
Tenant with the Tenant Improvements "substantially completed" (as such term is
defined in Paragraph 4(a)(iii) above) and ready for Tenant to commence the
installation of its trade fixtures and Tenant's Personal Property, on or before
said date, Landlord shall not be subject to any liability therefor, nor shall
such failure affect the validity of this Lease or the obligations of Tenant
hereunder, but in such case, Tenant shall not be obligated to pay Monthly Rent
or any items of Additional Rent other than as provided in Paragraph 4(b) above,
until possession of the Premises is tendered to Tenant as provided hereinabove;
provided, however, if Landlord shall not have delivered possession of the
Premises as provided hereinabove within one hundred twenty (120) days following
the Anticipated Commencement Date plus periods occurring as a result of delays
caused in whole or in part by Tenant or any delays which are beyond Landlord's,
reasonable control, including but not limited to, inclement weather, delays due
to strikes, acts of God, inability to obtain labor or materials, inability to
secure governmental approvals or permits, governmental restrictions, civil
commotion, fire or similar causes, Tenant may, at its option, by notice in
writing given to Landlord within fifteen (15) days thereafter, cancel this
Lease, in which event the parties shall be discharged from all obligations
hereunder; provided further, however, that if such written notice of Tenant is
not given to Landlord within said fifteen (15) day period, Tenant's rights to
cancel the Lease under this Paragraph 4(c) shall terminate and be on no further
force or effect.
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(d) TENANT DELAYS. The Commencement Date shall not be delayed or postponed
due to the fault of Tenant and the Term hereof and Tenant's obligation to pay
Monthly Rent and Additional Rent under the Lease shall commence upon the date
which would have been the Commencement Date but for the delay due to the fault
of Tenant, as said date is determined by Landlord. Delays "due to the fault" of
Tenant shall include, without limitation, delays caused by: (i) Tenant's failure
to timely approve the preliminary and working plans and specifications for the
Tenant Improvements; (ii) Tenant's request for or use of special materials,
finishes or installations which are not readily available or which otherwise
require additional time to obtain; (iii) Tenant's request for changes in the
plans and/or working drawings after Landlord has prepared the working plans and
specifications; or (iv) unreasonable interference with Landlord's work, if any,
caused by Tenant or by Tenant's agents, employees, contractors or
subcontractors.
5. RENT.
(a) Monthly Rent. Tenant shall pay to Landlord, in lawful money of the
United States, for each calendar month of the Term, the Monthly Rent set forth
in Paragraph (1) of the Lease Summary, subject to adjustment as provided in
Paragraph 5(b) below, in advance, on the first (1st) day of each calendar month,
without abatement, deduction, claim, offset, prior notice or demand. Landlord
hereby acknowledges receipt of Tenant's payment of Monthly Rent for the first
(1st) month of the Term.
(b) ADJUSTMENTS. The Monthly Rent as set forth hereinabove shall be
adjusted as provided in Exhibit "E" attached to this Lease.
(c) ADDITIONAL RENT. All monies required to be paid by Tenant under this
Lease, including, without limitation, Real Property Taxes payable pursuant to
Paragraph 14 hereof, repair and maintenance charges payable pursuant to
Paragraph 16 hereof and insurance premiums payable pursuant to Paragraph 20
hereof shall constitute Additional Rent. Landlord shall have the right to
reasonably estimate and collect from Tenant in advance on a quarterly or monthly
basis any and all such Additional Rent. Tenant shall be provided with a
reasonably detailed itemization of the Operating Expenses included within [text
missing]
(d) PRORATIONS. If the Commencement Date is not the first(1st) day of a
month, or if the expiration of the Term of this Lease is not the last day of a
month, a prorated Installment of Monthly Rent based on a thirty (30) day month
shall be paid for the fractional month during which the Term commences or
terminates.
6. LATE PAYMENT CHARGES. Tenant acknowledges that late payment by Tenant to
Landlord of Rent and other charges provided for under this Lease will cause
Landlord to incur costs not contemplated by this Lease, the exact amount of such
costs being extremely difficult or impracticable to fix. Such costs include, but
are not limited to, processing and accounting charges, and late charges that may
be imposed on Landlord by the terms of any encumbrance and notes secured by any
encumbrance covering the Premises, or late charges and penalties due to late
payment of Real Property Taxes due on the Premises. Therefore, if any
installment of Rent or any other charge due from Tenant is not received by
Landlord within ten (10) days following the applicable due date, Tenant shall
pay to Landlord an additional sum equal to the greater of One Hundred Dollars
($100.00) or five percent (5%) of the amount overdue as a late charge for every
month or portion thereof that the Rent or other charges remain unpaid. The
parties agree that this late charge represents a fair and reasonable estimate of
the costs that Landlord will incur by reason of the late payment by Tenant.
Acceptance of any late charge shall not constitute a waiver by Landlord of
Tenant's default with respect to the overdue amount, and shall not prevent
Landlord from exercising any of the other rights and remedies available to
Landlord for any other breach of Tenant under this Lease. Notwithstanding the
foregoing, upon the third (3rd) occurrence during the Term of this Lease of
Tenant's failure to pay Monthly Rent or Additional Rent when due, Landlord may
condition its acceptance of future Rent upon a requirement that Tenant
concurrently execute an amendment to this Lease which provides that Monthly Rent
for the balance of the Term of this Lease shall be made in quarterly
installments, in advance, in an amount equal to the sum of the Monthly Rent
amounts payable during such three (3) month period.
7. SECURITY DEPOSIT. Tenant has deposited with Landlord the sum set forth in
Paragraph (m) of the Lease Summary as a Security Deposit for the full and
faithful performance of every provision of this Lease to be performed by Tenant.
If Tenant defaults with respect to any provision of this Lease, Landlord may
apply all or any part of the Security Deposit for the payment of any Rent or
other sum in default, the repair of such damage to the Premises or the payment
of any other amount which Landlord may spend or become obligated to spend by
reason of Tenant's default or to compensate Landlord for any other loss or
damage which Landlord may suffer by reason of Tenant's default to the full
extent permitted by law. If any portion of the Security Deposit is to applied,
Tenant shall, within ten (10) days after written demand therefor, deposit cash
with Landlord in an amount sufficient to restore the Security Deposit to its
original amount, and Tenant's failure to do so shall be a default under this
Lease. Upon any Increase in the Monthly Rent during the Term, Tenant shall
deposit with Landlord additional funds such that the amount of the Security
Deposit held by Landlord shall at all times bear the same proportion to the then
current Monthly Rent as the original Security Deposit bears to the initial
Monthly Rent. Landlord shall not be required to keep the Security Deposit
separate from its general funds, and Tenant shall not be entitled to interest on
the Security Deposit. If Tenant is not otherwise in default, the Security
Deposit or any balance thereof shall be returned to Tenant within thirty (30)
days of the Termination Date.
8. HOLDING OVER. If Tenant remains in possession of all or any part of the
Premises after the expiration of the Term hereof with the prior written consent
of Landlord, such possession shall constitute a month-to-month tenancy only and
shall not constitute a renewal or extension for any further term. In such event,
Monthly Rent shall be increased to an amount equal to one hundred ten percent
(110%) of the Monthly Rent payable during the last month of the Term, and any
other sums due hereunder shall be payable in the amount and at the times
specified in this Lease. Such month-to-month tenancy shall be subject to every
other term, condition, and covenant contained herein.
9. CONDITION OF PREMISES.
(a) Landlord's sole construction obligations regarding Tenant Improvements
for the Premises will be as set forth in Paragraph 25 hereof. Subject to the
following provisions, Tenant, by taking possession of the Premises, acknowledges
having inspected the Premises and accepts them as being in good and sanitary
order, condition and repair and as having been constructed in accordance with
the Plans. Tenant will have a period of thirty (30) days after taking possession
of the Premises in which to advise Landlord of construction deficiencies or
defects, in addition to the punch list items referred to in Paragraph 4(a)
above, by written notice to Landlord. Except as hereafter provided, Landlord
will repair, replace or complete at its expense all items both on Tenant's punch
list and referenced on the 30-day notice referred to above, within thirty (30)
days after receipt of notice or as soon as Landlord, acting in good faith, can
complete thereafter. If Landlord reasonably contends that a particular punch
list or notice item is not justified, the parties will refer the issue to
Landlord's architect for resolution. If Tenant does not accept the opinion of
Landlord's architect, the parties will select an independent architect of
recognized standing to make a final determination.
(b) Tenant acknowledges that neither Landlord nor Landlord's Agents has
made any representations or warranties as to the suitability or fitness of the
Premises for the conduct of Tenant's business or for any other purpose, and that
neither Landlord nor Landlord's Agents has agreed to undertake any alterations
or construct any Tenant Improvements to the Premises except as expressly
provided in this Lease.
10. USE OF THE PREMISES.
(a) TENANT'S USE. Tenant shall use the Premises solely for the purposes
set forth in Paragraph (n) of the Lease Summary and shall not use the Premises
for any other purpose without obtaining the prior written consent of Landlord.
Tenant's use of the Premises shall be subject to all of the terms and conditions
of this Lease, including without limitation, the provisions of Paragraph 10(b)
hereof.
(b) COMPLIANCE.
(i) Tenant shall not use the Premises or suffer or permit anything to
be done in or about the Premises which will in any way conflict with any law,
statute, zoning restriction, ordinance or governmental law, rule, regulation or
requirement of any duly constituted public authority having jurisdiction over
the Premises now in force or which may hereafter be in force, or the
requirements of the Board of Fire Underwriters or other similar body now or
hereafter constituted relating to or affecting the condition, use or occupancy
of the Premises or any covenants, conditions, easements or restrictions now or
hereafter encumbering the Premises. Tenant shall not commit any public or
private nuisance or any other act or thing which might or would disturb the
quiet enjoyment of any other tenant of Landlord or any occupant of nearby
property. Tenant shall place no loads upon the floors, walls or callings in
excess of the maximum designed load specified by Landlord or which may damage
the Building or outside areas; nor place any harmful liquids in the drainage
systems, nor dump or store waste materials, refuse or other materials or allow
such to remain outside the Building proper, except in the enclosed trash areas
provided.
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(ii) In no event shall Tenant cause or permit any "Toxic Materials" (as
herein defined) to be brought upon, stored, used, released into the environment
or disposed of on or about the Premises except in compliance. As used herein,
"Toxic Materials" shall mean any hazardous, toxic or radioactive matter,
including those materials identified in Sections 66680 through 66685 of Title
22 of the California Administrative Code, Division 4, Chapter 30 ("Title 22")
as amended from time to time. If Tenant breaches the obligation in the
preceding sentence, or if the presence of Toxic Materials on the Premises
caused or permitted by Tenant results in the contamination of the Premises,
Tenant shall be solely responsible for and shall defend, indemnify and hold
Landlord and Landlord's Agents harmless from and against all claims, costs and
liabilities, including attorneys' fees and costs, arising out of or in
connection with such breach or contamination. Tenant shall further be solely
responsible for and shall defend, indemnify and hold Landlord, Landlord's
Agents and the Premises harmless from and against all claims, costs, and
liabilities, including attorneys' fees and costs, arising out of or in
connection with the removal, clean-up and restoration work and materials
necessary to return the Premises and any other property of whatever nature to
their condition existing prior to the appearance of the Toxic Materials on the
Premises. Tenant's obligations hereunder shall survive the termination of this
Lease. Tenant shall notify Landlord of and provide to Landlord copies of any
of the following environmental entitlements or inquiries relating to the
Premises which may be filed or served on Tenant: notices of violation, notices
to comply, citations, inquiries, reports filed pursuant to self-reporting
requirements, reports filed pursuant to any governmental law or regulation
relating to underground or aboveground tanks, permit applications, permits and
other reports or documents including those which may be characterized as
confidential. Landlord may, at any time, require that Tenant conduct
monitoring activities on the Premises satisfactory to Landlord with respect to
the release or potential release of Toxic Materials on or from the Premises.
In the event of a release of any Toxic Materials to the environment, Tenant
will furnish to Landlord copies of any and all reports and/or correspondence
with any governmental agencies relating to such release.
(iii) Tenant acknowledges that it has read the CC&R's, the REA and the
SLURS (as those items are defined in Paragraph 3 hereof), and knows the
contents thereof. Tenant agrees that this Lease is subject and subordinate to
the CC&R's, the SLURS and the REA, as the same may now or hereafter exist, and
that it will execute and deliver to Landlord within fifteen (15) days of
Landlord's request therefor, any further documentation or instruments which
Landlord deems necessary or desirable to evidence or effect such subordination;
provided, that, any future amendments to the CC&R's, the SLURS or the REA shall
not substantially interfere with Tenant's use and enjoyment of the Premises.
Throughout the Term Tenant shall timely comply with all of the terms,
provisions and restrictions of the REA, the SLURS and the CC&R's and any
modifications or amendments thereof which pertain, restrict or affect the
Premises, or Tenant's use of any other area of the Project as permitted
hereunder, including the payment by Tenant of Tenant's Percentage of any
periodic or special dues or assessments charged against the Project, the
Building (or against the Landlord as the owner thereof), in accordance with the
provisions of the REA, the SLURS or the CC&R's. Tenant shall hold Landlord,
Landlord's Agents and the Premises harmless and indemnify Landlord and
Landlord's Agents against any loss, expense, damage, attorneys' fees and costs
or liability arising out of or in connection with the failure of Tenant to so
perform or comply with the CC&R's, the SLURS and the REA. The failure of
Tenant to so comply with the requirements of the CC&R's, the SLURS or the REA
shall constitute a material default hereunder. Tenant agrees that it will
subordinate the Lease to any other covenants, conditions and restrictions and
any reciprocal easement agreements or any similar agreements which Landlord may
hereafter record against the Premises or any portion thereof, provided that
such subordination does not unreasonably interfere with Tenant's use and
enjoyment of the Premises.
11. QUIET ENJOYMENT. Subject to the right of any lender of record,
Landlord covenants that Tenant, upon performing the terms, conditions and
convenants of the Lease, shall have quiet and peaceful possession of the
Premises as against any person claiming the same by, through or under Landlord.
12. ALTERATIONS.
(a) PERMITTED ALTERNATIONS. After the Commencement Date, Tenant shall
not make or permit any Alterations in, on or about the Premises, except for
non-structural Alterations not exceeding Five Thousand Dollars ($5,000.00) in
aggregate cost over the Term of the Lease, without the prior written consent of
Landlord, which consent will not be unreasonably withheld. All Alterations
shall be constructed pursuant to plans and specifications approved in writing
by Landlord. Notwithstanding the foregoing, Tenant shall not, without the
prior written consent of Landlord, which consent may be withheld in Landlord's
sole discretion, make any: (i) Alterations to the exterior of the Building or
the outside areas: (ii) Alterations to or penetrations of the structural
portions of the Building including, without limitation, the roof, or which will
interfere with the proper functioning of any HVAC, electrical or mechanical
facilities or equipment located in the Building, or (iii) Alterations visible
from outside the Building to which Landlord may withhold its consent based on
wholly aesthetic grounds.
All Alterations shall be installed by a licensed contractor at Tenant's
sole expense in compliance with all applicable laws and covenants, conditions
and restrictions of record. The work shall be done in a good and workmanlike
manner conforming in quality and design with the Premises existing as of the
Commencement Date, and shall not diminish the value of the Premises. Tenant
shall, if required by Landlord, obtain and pay for, at its own expense, a
completion and indemnity bond, the form and amount of which shall be subject to
the approval of Landlord. All Alterations made by Tenant, which cannot be
removed without damage or defacing of the premises, shall be and become the
property of Landlord upon the installation thereof and shall not be deemed
Tenant's Personal Property; provided, however, that Landlord may, at its
option, require that Tenant, upon the termination of this Lease, at Tenant's
expense, remove any or all non-structural Alternations installed by Tenant and
return the Premises to its condition as of the Commencement Date of this Lease,
normal wear and tear excepted. Notwithstanding any other provisions of this
Lease, Tenant shall be solely responsible for the maintenance, repair and
replacement of any and all Alterations made by it to the Premises. Further, in
the event the Alterations include any aboveground or underground tanks,
concrete sumps, non-vaulted buried tanks, earthen-walled pits, ponds or
lagoons or other underground containers, Tenant shall prepare a risk assessment
which addresses any and all concerns of Landlord. The adequacy of the risk
assessment shall be determined in Landlord's sole discretion.
(b) NOTICE. Tenant shall give Landlord written notice of Tenant's
intention to perform work on the Premises which might result in any claim of
lien at least twenty (20) days prior to the commencement of such work to enable
Landlord to post and record a notice of nonresponsibility or other notice
Landlord deems proper prior to the commencement of any such work. Tenant shall
not permit any mechanic's, materialmen's or other liens to be filed against the
property of which the Premises are a part, nor against Tenant's leasehold
interest in the Premises. If Tenant fails to remove or bond any lien(s) filed
against the Premises or its leasehold estate therein in connection with any work
performed or any work claimed to have been performed by or at the direction of
Tenant within thirty (30) days from the date of the lien filing(s), then
Landlord may remove such lien(s) at Tenant's expense and Tenant shall reimburse
Landlord for all costs incurred by Landlord in connection with the removal of
the lien(s), which amount shall be deemed Additional Rent, and shall include,
without limitation, all sums disbursed, incurred or deposited by Landlord,
including Landlord's costs, expenses and actual attorneys' fees with interest
thereon at the Interest Rate from the date of expenditure.
13. SURRENDER OF THE PREMISES. Upon the expiration or earlier termination
of this Lease, Tenant shall surrender the Premises to Landlord in its condition
existing as of the Commencement Date, normal wear and tear and acts of God
excepted, with all interior walls in good repair, plumbing, electrical and other
mechanical installations in good operating order, and all floors cleaned and
waxed, all to the reasonable satisfaction of Landlord. Tenant shall remove from
the Premises all of Tenant's Alterations which Landlord requires Tenant to
remove pursuant to Paragraph 12 and all Tenant's Personal Property, and shall
repair any damage and perform any restoration work caused by such removal,
provided, however, if Tenant is then in default, Tenant shall not be entitled
to remove Tenant's Personal Property except as specified by written notice
delivered by Landlord to Tenant. If Tenant fails to remove such Alterations and
Tenant's Personal Property which Tenant is authorized and obligated to remove
pursuant to the above, and such failure continues after the termination of this
Lease, Landlord may retain such property and all rights of Tenant with respect
to it shall cease, or Landlord may place all or any portion of such property in
public storage for Tenant's account. Tenant shall pay to Landlord, upon demand,
the costs of removal of any such Alterations and Tenant's Personal Property and
storage and transportation costs of same, and the cost of repairing and
restoring the Premises, together with attorneys' fees and interest on said
amounts at the Interest Rate from the date of expenditure by Landlord. If the
Premises are not so surrendered at the termination of this Lease, Tenant hereby
agrees to indemnify Landlord and its Agents against all loss or liability
resulting from delay by Tenant in so surrendering the Premises, including,
without limitation, any claims made by any succeeding tenant, losses to Landlord
due to lost opportunities to lease to succeeding tenants, and actual attorneys'
fees and costs.
14. REAL AND PERSONAL PROPERTY TAXES.
(a) PAYMENT BY TENANT. Tenant shall pay, as Additional Rent, all
personal property taxes now or hereafter levied against Tenant's Personal
Property, and Tenant's Percentage of all Real Property Taxes levied against the
Project, during the Term as the same become due and payable. Landlord agrees to
forward to Tenant copies of all notices and tax bills pertaining to the Premises
upon receipt.
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Tenant shall pay to Landlord the full amount of such Real Property Taxes as
shown on said notices and bills in monthly installments as an Operating Expense
pursuant to Paragraph 16(a) below. If Tenant shall fail to timely pay any Real
Property Taxes or personal property taxes, Landlord shall have the right but not
the obligation to: (i) pay the same, in which case Tenant shall immediately
repay such amount to Landlord including interest at the Interest Rate from the
date paid by Landlord until the date of payment by Tenant; and (ii) exercise any
and all remedies available to Landlord pursuant to Paragraph 26. Tenant may
contest the amount or validity of any Real Property Taxes by appropriate
proceedings; provided that Tenant shall promptly pay such taxes unless such
proceedings shall operate to prevent or stay the collection of the tax so
contested. Landlord shall join in any such proceedings if any law shall so
require, providing that Tenant shall indemnify Landlord against any liability,
cost or expense in connection therewith, including, without limitation, actual
attorneys' fees and costs.
(b) APPORTIONMENT. If the Premises or the Project are not assessed as a
separate parcel, then Landlord shall equitably apportion the Real Property Taxes
assessed against the real property which includes the Premises based upon the
ratio of the square footage of the Premises to the total square footage of all
leasable space within the buildings on the assessed parcel, and Tenant shall pay
the amount of Real Property Taxes so apportioned to the Premises.
(c) TAX ON IMPROVEMENTS. Tenant shall pay any increase in Real Property
Taxes attributable to any and all Alterations and Tenant Improvements of any
kind whatsoever placed in, on or about the Premises for the benefit of, at the
request of, or by Tenant.
(d) PRORATION. Tenant's liability to pay Real Property Taxes shall be
prorated on the basis of a three hundred sixty-five (365) day year to account
for any fractional portion of a fiscal tax year included at the commencement or
expiration of the Term. With respect to any assessments which may be levied
against or upon the Premises, or which under the laws then in force may be
evidenced by improvements or other bonds or may be paid in annual installments,
only the amount of such annual installment (with appropriate proration for any
partial year) and interest due thereon shall be included within the computation
of the annual Real Property Taxes levied against the Premises.
(e) PAYMENT ON EXPIRATION OF TERM. If this Lease terminates on a date
earlier than the end of a fiscal tax year, Landlord shall deliver to Tenant a
statement setting forth the amount of Real Property Taxes to be paid by Tenant
prorated to the date of termination. Tenant shall pay to Landlord such prorated
amount within five (5) days of Tenant's receipt of the statement.
(f) PERSONAL PROPERTY TAXES. Tenant shall pay prior to delinquency all
taxes assessed or levied against Tenant's Personal Property in, on or about the
Premises. When possible, Tenant shall cause its Personal property to be assessed
and billed separately from the real or personal property of Landlord.
(g) FAILURE TO PAY. Tenant's failure to timely pay any of the charges
which are not included in Operating Expenses; required to be paid under this
Paragraph shall constitute a material default under this Lease.
15. UTILITIES AND SERVICES. Tenant shall be responsible for and shall pay
promptly all charges for water, gas, electricity, sewer, heat, light, power,
telephone, refuse pickup, janitorial service and all other utilities, materials
and services furnished directly to or used by Tenant in, on or about the
Premises during the Term, which are not included in Operating Expenses; together
with any taxes thereon. Landlord shall not be liable in damages or otherwise for
any failure or interruption of any utility or other service furnished to the
Premises. No such failure or interruption shall entitle Tenant to terminate this
Lease or withhold or abate Rent or other sums due hereunder.
16. OPERATING EXPENSES, REPAIRS AND MAINTENANCE.
(a) TENANT TO BEAR SHARE OF OPERATING EXPENSES.
(i) Tenant shall pay to Landlord as hereinafter provided,
Tenant's percentage of "Operating Expenses", as defined in Paragraph 16(b)
below. "Tenant's Percentage", as set forth in Paragraph (q) of the Lease
Summary, is that percentage that the gross square feet of the floor area of the
Premises bears to that total gross square footage of the floor area of leasable
space within the Building.
(ii) Prior to the commencement of each calendar year, Landlord
shall give Tenant a written estimate of Tenant's Percentage of Operating
Expenses for the ensuing calendar year. Tenant shall pay its estimated share of
Operating Expenses in equal monthly installments in advance, on or before the
first (1st) day of each month. Within ninety (90) days after the end of each
calendar year (or such shorter interval as Landlord shall select), Landlord
shall furnish Tenant a statement showing in reasonable detail, the actual
Operating Expenses for the Building incurred for the period in question and the
parties shall within thirty (30) days thereafter, make payment or allowance
necessary to adjust Tenant's estimated payments to the actual Tenant's
Percentage of Operating Expenses as shown by the applicable periodic statements
submitted to Tenant by Landlord.
(iii) If Landlord shall determine at any time or from time to
time that the estimate of Tenant's Percentage of Operating Expenses for the
current calendar year is, or will become inadequate to meet Tenant's share of
such Operating Expenses for any reason, Landlord shall immediately determine the
approximate amount of such inadequacy and issue a supplemental estimate as to
Tenant's Percentage of Operating Expenses, and Tenant shall pay said increase in
the estimated Tenant's Percentage of Operating Expenses as reflected by such
supplemental estimate.
(iv) Landlord shall keep or cause to be kept separate and
complete books of accounting covering costs and expenses of operating and
maintaining the Common Area and other portions of the Project which Landlord is
required to maintain and repair showing the method of calculating Tenant's
Percentage of Operating Expenses, and shall preserve for at least twenty-four
(24) months after the close of each fiscal year all vouchers, invoices,
statements or payroll records, and other papers evidencing said costs and
expenses for that calendar year. Tenant, at its sole cost and expense through
any certified public accountant designated by it, shall have the right to
examine and/or audit the books and other documents mentioned above evidencing
such costs and expenses for the previous two (2) calendar years, during
reasonable business hours and not more frequently than once during any calendar
year.
(b) DEFINITION OF THE OPERATING EXPENSES. The term "Operating
Expenses" as used herein shall mean Real Property Taxes for the Project, all
costs and expenses incurred in connection with the maintenance and operation of
the Project, which costs shall include, without limitation, repair and
maintenance to the roof and the exterior walls of the buildings in the Project,
periodic painting of the buildings in the Project, landscaping services, HVAC
maintenance contracts and normal maintenance of the HVAC, sweeping, maintenance
services, repairs to and replacement of asphalt paving, bumpers, striping, light
bulbs, light standards, guard and directional signs and lighting systems,
perimeter walls, retaining walls, sidewalks, planters, landscaping and sprinkler
system in planting area, any and all assessments levied against the Project
pursuant to the CC&R's, water, electrical and other utility services thereto,
removal of trash, rubbish and other refuse from the Project, cleaning of and
replacement of signs of the Project, including relamping and repairs made as
required; maintenance of all of the Common Area from any obstructions not
reasonably required for the Common Area uses, including the prohibition of the
sale or display of merchandise or the storing of materials and/or equipment in
the Common Area, payment of all electrical, water and other utility charges or
fees for services furnished to Common Area; obtaining and maintaining public
liability, property damage and other forms of insurance which Landlord may or is
required to maintain in connection with the Project (including the payment of
any deductibles thereunder); establishment of reasonable reserves for
replacements and/or repair of Common Area improvements, equipment and supplies;
employment of such personnel as Landlord may deem reasonably necessary, if any,
to direct parking and police the Common Area and facilities; employment of
personnel used in connection with the operation, maintenance and repair of the
Common Area including payment or provision for unemployment insurance, workers'
compensation insurance and other employee costs;* the cost of bookkeeping and
accounting and legal services provided in connection with the operation and
maintenance of the Common Area by Landlord;* any other items reasonably
necessary from time to time to properly repair, replace, maintain and operate
the Common Area within the Project and any interest paid in connection
therewith, and a management fee to cover Landlord's management, overhead and
administrative expenses. Notwithstanding the foregoing, if Landlord elects to
delegate its duties hereunder to a professional property manager, then Landlord
shall not be entitled to receive any management fee (except for any costs and/or
administrative and overhead expenses reasonably incurred by Landlord in
"monitoring" and "auditing" the performance delegated to the professional
property manager as contemplated herein which costs and/or expenses shall be
reimbursed to Landlord as incurred and billed) but under such circumstances any
reasonable amounts paid to the professional property manager shall be added to
and deemed a part of the Operating Expenses.
* If the foregoing personnel are used in connection with projects other than the
Project, a prorata cost of such personnel shall be charged to the Project as
an Operating Expense.
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(c) Repairs and Maintenance
(i) Tenant shall, subject to Landlord's obligations as hereunder
provided, at all times during the Term of this Lease or any extension thereof,
and at Tenant's sole cost and expense, keep, maintain and repair the Premises
and every portion thereof and every improvement therein, in good and sanitary
order and condition (usual wear and tear excepted), including without limitation
all necessary maintenance and repairs to all portions of the Premises, and all
exterior entrances, all glass, window casements, show window mouldings, all
partitions, doors, doorjams, door closers, or hardware, fixtures, equipment,
electrical lighting and systems, plumbing and plumbing fixtures, ducts, pipes,
wiring, conduits and all required air conditioning and healing systems repairs,
exclusive of normal maintenance services. Tenant agrees that it will not, nor
will it authorize any person to go onto the roof of the Building without the
prior written consent of Landlord.
(ii) Landlord shall, subject to receiving Tenant's Percentage of
Operating Expenses, maintain in good and sanitary condition and repair the roof
of the Building in which the premises are located and the normal maintenance
services for the HVAC for the Premises, if any, and paint the exterior of the
Building within which the Premises are located as and when such painting
becomes reasonably necessary in Landlord's sole discretion. Landlord shall not
be required to make any repairs to the roof unless and until Tenant has
notified Landlord in writing of the need for such repair and Landlord shall
have a reasonable period of time hereafter to commence and complete said repair.
(iii) The cost of any maintenance and repairs on the part of
Landlord provided for in this Paragraph 16 shall be considered Operating
Expenses as herein defined.
(d) Waiver. Tenant hereby waives all rights provided for by the
provisions of Sections 1941 and 1942 of the California Civil Code and any
similar or successor law regarding Tenant's right to make repairs at the
expense of Landlord.
(e) Compliance with Governmental Regulations. Tenant shall, at its
own cost and expense, promptly and properly observe and comply with, including
the making by Tenant of any Alteration to the Premises, all present and future
orders, regulations, directions, rules, laws, ordinances, and requirements of
all governmental authorities (including, without limitation, state, municipal,
county and federal governments and their departments, bureaus, boards and
officials) arising from the use or occupancy of, or applicable to, the Premises
or privileges appurtenant to or in connection with the enjoyment of the
Premises.
(f) Tenant's Failure to Pay. Tenant's failure to timely pay any of
the charges in connection with the performance of its maintenance and repair
obligations to be paid under this Paragraph shall constitute a material default
under this Lease.
17. Fixtures. Tenant shall, at its own expense, provide, install and
maintain in good condition all Tenant's Personal Property required in the
conduct of its business in the Premises.
18. Landlord's Right to Enter the Premises. Tenant shall permit Landlord
and Landlord's Agents to enter the Premises at all reasonable times upon
reasonable notice, except for emergencies in which case no notice shall be
required, to inspect the same, to post notices of nonresponsibility and similar
notices and signs indicating the availability of Premises for sale, to show the
Premises to interested parties such as prospective lenders and purchasers, to
make necessary Alterations or repairs, to discharge Tenant's obligations
hereunder when Tenant has failed to do so within a reasonable time after written
notice from Landlord, and at any reasonable time after one hundred eighty (180)
days prior to the expiration of the Term, to place upon the Premises such
reasonable signs indicating availability of Premises for lease and to show the
Premises to prospective tenants. The above rights are subject to reasonable
security regulations of Tenant and to the requirement that Landlord shall at all
times act in a manner to cause the least possible interference with Tenant's
business. Notwithstanding anything contained herein to the contrary, in the
event a release of Toxic Materials occurs on or affects the Premises, Tenant
shall permit Landlord or Landlord's Agents to enter the Premises at any time
without prior notice, to inspect, monitor, take emergency or longterm remedial
action, discharge Tenant's obligations hereunder if Tenant has failed to do so,
or take any other action to restore the Premises to its original condition.
19. Signs. Landlord shall designate the location on the Premises, if any,
for one (1) or more exterior Tenant identification sign(s). Tenant shall have
no right to maintain Tenant identification signs in any other location in, on
or about the Premises and shall not display or erect any other signs, displays
or other advertising materials that are visible from the exterior of the
Building. The size, design, color and other physical aspects of permitted
sign(s) shall be subject to the Landlord's written approval prior to
installation, which approval may be withheld in Landlord's discretion, any
covenants, conditions or restrictions encumbering the Premises and any
applicable municipal or other governmental permits and approvals. The cost of
the sign(s), including the installation, maintenance and removal thereof shall
be at Tenant's sole cost and expense. If Tenant fails to maintain its sign(s),
or if Tenant fails to remove same upon termination of this Lease and repair any
damage caused by such removal (including, without limitation, repainting the
Building, if required by Landlord), Landlord may do so at Tenant's
expense. Tenant shall reimburse Landlord for all costs incurred by Landlord to
effect such removal, which amounts shall be deemed Additional Rent, and shall
include, without limitation, all sums disbursed, incurred or deposited by
Landlord including Landlord's costs, expenses and actual attorneys' fees with
interest thereof at the Interest Rate. (SEE RIDER NO. 4)
20. Indemnity; Insurance.
(a) Indemnification. Tenant hereby agrees to defend (with attorneys
reasonably acceptable to Landlord), indemnify and hold harmless Landlord and
Landlord's Agents from and against any and all damage, loss, liability and
expense including, without limitation, actual attorneys' fees and legal costs,
incurred directly or indirectly by reason of any claim, suit or judgment brought
by or on behalf of any person or persons for damage, loss or expense due to,
but not limited to, bodily injury or property damage sustained by such person
or persons which arise out of, are occasioned by, or are in any way
attributable to the use or occupancy of the Premises, the acts or omissions of
the Tenant, its agents, employees or contractors, except to the extent caused
by the sole negligence or willful misconduct of Landlord. Tenant agrees that
the obligations of Tenant herein shall survive the expiration or earlier
termination of this Lease.
(b) Insuring Party. As used in this Paragraph the term "Insuring
Party" shall mean the party designated in Paragraph (p) of the Lease Summary
who has the obligation to obtain the property insurance required hereunder. If
Landlord is the Insuring Party, Landlord shall not be required to name Tenant
as an additional insured under any such policy.
(c) Tenant's Insurance. Tenant agrees to maintain in full force and
effect at all times during the Term, at its own expense, for the protection of
Tenant and Landlord, as their interests may appear, policies of insurance
issued by a carrier or carriers acceptable to Landlord and its lender(s) of
record which afford the following coverages: (i) statutory workers'
compensation (ii) employer's liability with minimum limits of not less than One
Hundred Thousand Dollars ($100,000); (iii) comprehensive general liability
insurance including, but not limited to, blanket contractual liability, broad
form property damage, personal injury, independent contractors, and owned,
non-owned and hired vehicles, of not less than Two Million Dollars ($2,000,000)
combined single limit bodily injury and property damage (or current limit
carried, whichever is greater), naming Landlord and Landlord's mortgagees as
additional insureds; (iv)______________ (v) and such other insurance, in such
form and amounts as may be required by Landlord or its lender(s) from time to
time.
(d) Property Insurance. The Insuring Party shall obtain and keep in force
during the Term of this Lease a policy or policies of insurance (with
replacement cost endorsement) covering loss or damage to the Premises in the
amount of the full replacement cost thereof, but in no event less than the total
amount required by lender(s) having lien(s) on the Premises, against all perils
included within the classification of fire, extended coverage, vandalism,
malicious mischief, and special extended perils ("all risk" as such term is used
in the insurance industry). Tenant shall, in addition, obtain and keep in force
during the Term of this Lease a policy of business interruption and/or loss of
income insurance covering a period of one (1) year, with loss payable to
Landlord, which insurance shall also cover all real estate taxes and insurance
costs for said period of one (1) year, with loss payable to Landlord, which
insurance shall also cover all real estate taxes and insurance costs for said
period. A stipulated value or agreed amount endorsement deleting the
coinsurance provision of the policy shall be procured with said insurance. If
the Premises are part of a larger building, or if the Premises are part of a
group of buildings owned by Landlord which are adjacent to the Premises, then
Tenant shall pay for any increase in the property insurance of the Building or
such other building or buildings if said increase is caused by Tenant's acts,
omissions, use or occupancy of the Premises. If the Landlord is the insuring
Party, Landlord will not insure Tenant's fixtures, contents, equipment and
tenant improvements. Tenant shall obtain and keep in force, at its expense, an
"all risk" property damage policy in the amount of the full replacement cost
covering Tenant's fixtures, contents, equipment and tenant improvements.
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(e) DEDUCTIBLES. Any policy of insurance required of Tenant pursuant
to this Lease containing a deductible exceeding Twenty-Five Thousand Dollars
($25,000) must be approved in writing by Landlord prior to the issuance of such
policies; it being understood and agreed that Tenant shall be solely
responsible for the payment of any such deductible.
(f) CERTIFICATES. Tenant shall deliver to Landlord at least thirty
(30) days prior to the time such insurance is first required to be carried by
Tenant, and thereafter prior to expiration of each such policy, certificates of
insurance evidencing the above coverage with limits not less than those
specified above. The certificates shall expressly provide that the interest of
Landlord therein shall not be affected by any breach of Tenant of any policy
provision for which such certificates evidence coverage.
(g) INCREASED COVERAGE. Upon demand, Tenant shall provide Landlord,
at Tenant's expense, with such increased amount of existing insurance, and such
other insurance as Landlord or Landlord's lender(s) may reasonably require.
(h) CO-INSURER. If, on account of the failure of Tenant to comply
with the foregoing provisions, Landlord is adjudged a co-insurer by its
insurance carrier, then, any loss or damage Landlord shall sustain by reason
thereof, including attorneys' fees and costs, shall be borne by Tenant and
shall be immediately paid by Tenant upon receipt of a bill therefor and
evidence of such loss.
(i) SUFFICIENCY OF COVERAGE. Neither Landlord nor Landlord's Agents
makes any representation that the limits of liability specified to be carried
by Tenant under this Lease are adequate to protect Tenant. If Tenant believes
that any such insurance coverage is insufficient, Tenant shall provide, at its
own expense, such additional insurance as Tenant deems adequate.
(j) INSURANCE REQUIREMENTS. All such insurance: (i) shall be in a
form satisfactory to Landlord and its lender(s) and shall be carried with
companies that have a general policyholder's rating of not less than "A" and a
financial rating of not less than Class "X" in the most current edition of
Best's Insurance Reports; (ii) shall provide that such policies shall not be
subject to material alteration or cancellation except after at least thirty
(30) days' prior written notice to Landlord; and (iii) shall be primary, and
any insurance carried by Landlord shall be noncontributing. The policy or
policies, or duly executed certificates for them, shall be deposited with
Landlord prior to the Commencement Date, and upon renewal of such policies. If
Tenant fails to procure and maintain the insurance required to be procured by
Tenant hereunder, Landlord may, but shall not be required to, order such
insurance at Tenant's expense and Tenant shall reimburse Landlord for all costs
reasonably incurred by Landlord with respect thereto. Tenant's reimbursement
to Landlord for such amounts shall be deemed Additional Rent, and shall include
all reasonable sums disbursed, incurred or deposited by Landlord including
Landlord's costs, expenses and actual attorneys' fees, with interest thereon at
the Interest Rate.
(k) LANDLORD'S DISCLAIMER. Landlord and Landlord's Agents shall not
be liable for any loss or damage to persons or property resulting from fire,
explosion, falling materials, glass, tile or sheetrock, steam, gas,
electricity, water or rain which may leak from any part of the Premises, or
from the pipes, appliances or plumbing works therein or from the roof, street
or subsurface or whatsoever, unless caused by or due to the active negligence
or willful acts of Landlord. Landlord and Landlord's Agents shall not be
liable for interference with light or air, or for any latent defect in the
Premises. Tenant shall give prompt written notice to Landlord in case of a
casualty, accident or repair needed to the Premises.
(l) FAILURE TO PAY. The failure of Tenant to obtain and pay for any
insurance required to be obtained and paid for by it hereunder shall constitute
a material default under this Lease.
21. WAIVER OF SUBROGATION. Landlord and Tenant each hereby waive all
rights of recovery against the other on account of loss and damage occasioned
to such waiving party for its property or the property of others under its
control to the extent that such loss or damage is insured against under any
property insurance policies in force at the time of such loss or damage.
Tenant and Landlord shall, upon obtaining policies of insurance required
hereunder, give notice to the insurance carrier that the foregoing mutual
waiver of subrogation is contained in this Lease and Tenant and Landlord shall
cause each insurance policy obtained by such party to provide that the
insurance company waives all right of recovery by way of subrogation against
either Landlord or Tenant in connection with any damage covered by such policy.
22. DAMAGE OR DESTRUCTION.
(a) LANDLORD'S OBLIGATION TO REBUILD. If the Premises are damaged or
destroyed, Landlord shall promptly and diligently repair the Premises unless it
has the right to terminate this Lease as provided in Paragraph 22(b) below and
it elects to so terminate.
(b) LANDLORD'S RIGHT TO TERMINATE. Landlord shall have the right to
terminate this Lease following damage to or destruction of the Premises if any
of the following occurs: (i) insurance proceeds together with additional
amounts Tenant agrees to contribute are not available to Landlord to pay one
hundred percent (100%) of the cost to fully repair the damaged Premises,
excluding the deductible for which Tenant shall also be responsible; (ii) the
Premises cannot, with reasonable diligence, be fully repaired by Landlord
within one hundred twenty (120) days after the date of the damage or
destruction; (iii) the Premises cannot be safely repaired because of the
presence of hazardous factors, including, but not limited to, earthquake
faults, radiation, chemical waste and other similar dangers; (iv) the Premises
are destroyed or damaged during the last twelve (12) months of the Term; or (v)
Tenant is in default under the terms of this Lease at the time of such damage
or destruction.
If Landlord elects to terminate this Lease, Landlord may give Tenant
written notice of its election to terminate within thirty (30) days after it
has knowledge of such damage or destruction, and this Lease shall terminate
fifteen (15) days after the date Tenant receives such notice. If this Lease is
terminated, Landlord shall, subject to the rights of its lender(s), be entitled
to receive and retain all the insurance proceeds resulting from such damage,
except for those proceeds payable under policies obtained by Tenant which
specifically insure Tenant's Personal Property. If Landlord elects not to
terminate the Lease, Landlord shall, promptly following the date of such damage
or destruction and receipt of amounts required of Tenant pursuant to Paragraph
22(b)(i) above, commence the process of obtaining necessary permits and
approvals, and shall commence repair of the Premises as soon as practicable and
thereafter prosecute the same diligently to completion, in which event this
Lease will continue in full force and effect.
(c) LIMITED OBLIGATION TO REPAIR. Landlord's obligation, should it
elect or be obligated to repair or rebuild, shall be limited to the basic
Building and Tenant Improvements and Tenant shall, at its expense, replace or
fully repair all Tenant's Personal Property and any Alterations installed by
Tenant existing at the time of such damage or destruction. If the Premises are
to be repaired in accordance with the foregoing, Landlord shall make available
to Tenant any portion of insurance proceeds it receives which are allocable to
the Alterations constructed by Tenant pursuant to this Lease provided Tenant is
not then in default.
(d) ABATEMENT OF RENT. Rent shall be temporarily abated
proportionately, during any period when, by reason of such damage or
destruction, Landlord reasonably determines that there is substantial
interference with Tenant's use of the Building. Such abatement shall commence
upon such damage or destruction and end upon substantial completion by Landlord
of the repair or reconstruction which landlord is obligated or undertakes to
do. Tenant shall not be entitled to any compensation or damages from Landlord
for loss of the use of the Premises, damage to Tenant's Personal Property or
any inconvenience occasioned by such damage, repair or restoration. Tenant
hereby waives the provisions of Section 1932(2) and Section 1933(4) of the
California Civil Code, and the provisions of any similar law hereinafter
enacted.
(e) REPLACEMENT COST. The determination in good faith by Landlord of
the estimated cost of repair of any damage, of the replacement cost, or of the
time period required for repair shall be conclusive for purposes of this
Paragraph.
23. CONDEMNATION.
(a) TOTAL TAKING -- TERMINATION. If title to all of the Premises or
so much thereof is taken for any public or quasi-public use under any statute
or by right of eminent domain so that reconstruction of the Premises will not
result in the Premises being reasonably suitable for Tenant's continued
occupancy for the uses and purposes permitted by this Lease, this Lease shall
terminate as of the date possession of the Premises or part thereof be taken.
(b) PARTIAL TAKING. If any part of the Premises is taken and the
remaining part is reasonably suitable for Tenant's continued occupancy for the
purposes and uses permitted by this Lease, without unreasonable disruption or
interference of the Tenant, this Lease shall, as to the part so taken, terminate
as of the date that possession of such part of the Premises is taken and the
Monthly Rent shall be reduced in the same proportion that the floor area of the
portion of the Building so taken (less any addition thereto by reason of any
reconstruction) bears to the original floor area of the Building. Landlord
shall, at its own cost and expense, make all necessary repairs or alterations to
the Building so as to make the portion of the Building not taken a complete
architectural unit. Such work shall not, however, exceed the scope of the work
done by Landlord in originally constructing the Building. Monthly Rent due and
payable hereunder shall be temporarily abated during such restoration period in
proportion to the degree to which Tenant's use of Premises is impaired. Each
party hereby waives the provisions of Section 1265.130 of the California Code of
Civil Procedure allowing either party to petition the Superior Court to
terminate in the event of a partial taking of the Building or Premises.
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<PAGE> 10
PAGE 7A
(22. Destruction or Damage - Continued)
Anything in this Lease to the contrary notwithstanding:
In the event the Premises are damaged or destroyed by fire or other
casualty and if this Lease is not terminated, then Landlord shall promptly
repair and restore the same to substantially the condition which said Premises
were in immediately prior to the happening of such casualty, and if same are not
so restored or repaired within one hundred twenty (120) days of such casualty,
then Tenant at Tenant's option may terminate this Lease by written notice to
Landlord within thirty (30) days thereafter, Tenant's right of termination,
however, shall not be applicable if Landlord is able to relocate Tenant as
provided below, or if such damage or destruction is caused by Tenant's
negligence or willful misconduct.
From the date of such casualty until the Premises are repaired and
restored, the Rent and Additional Rent and other charges payable under this
Lease shall abate in such proportion as the part of the Premises destroyed,
damaged or rendered untenantable bears to the total Premises; however, if
Tenant is unable to conduct business in the Premises as a result of such fire or
casualty, then Rent and all additional rent and other charges shall abate
totally until Landlord's repairs are completed and Tenant can resume business in
the Premises.
Provided Tenant is not then in default of its obligations with this Lease;
within thirty (30) days of such casualty and until the Premises are restored,
Landlord will assist Tenant in relocating into temporary space within the
Irvine/Sammis Bio-Tech Park or any other Irvine Company property that is vacant
and available. Rent and all Additional Rent and other charges payable under this
Lease, shall not be abated while Tenant is in possession of such temporary
space.
If this Lease is terminated as herein provided, then the effective date of
said termination shall be the date of such damage or destruction, and rent shall
be adjusted as of said date.
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<PAGE> 11
(c) NO APPORTIONMENT OF AWARD. No award for any partial or entire taking
shall be apportioned, it being agreed and understood that Landlord shall be
entitled to the entire award for any partial or entire taking. Tenant assigns to
Landlord its interest in any award which may be made in such taking or
condemnation, together with any and all rights of Tenant arising in or to the
same or any part thereof. Nothing contained herein shall be deemed to give
Landlord any interest in or require Tenant to assign to Landlord any separate
award made to Tenant for the taking of Tenant's Personal Property for the
interruption of Tenant's business, or its moving costs, or for the loss of its
goodwill.
(d) TEMPORARY TAKING. No temporary taking of the Premises shall
terminate this Lease or give Tenant any right to any abatement of Rent. Any
award made to Tenant by reason of such temporary taking shall belong entirely to
Tenant and Landlord shall not be entitled to share therein. Each party agrees to
execute and deliver to the other all instruments that may be required to
effectuate the provisions of this Paragraph.
(e) SALE UNDER THREAT OF CONDEMNATION. A sale made in good faith by
Landlord to any authority having the power of eminent domain, either under
threat of condemnation or while condemnation proceedings are pending, shall be
deemed a taking under the power of eminent domain for all purposes of this
Paragraph.
24. ASSIGNMENT AND SUBLETTING.
(a) PROHIBITION. Tenant shall not assign, mortgage, hypothecate,
encumber, grant any license or concession, pledge or otherwise transfer
(collectively, "assignment") this Lease, in whole or in part, nor sublet or
permit occupancy by any person other than Tenant of all or any part of the
Premises, without the prior written consent of Landlord in each instance, which
consent shall not be unreasonably withheld. Any purported assignment or
subletting contrary to the provisions hereof without consent shall be void. The
consent by Landlord to any assignment or subletting shall not constitute a
waiver of the necessity for such consent to any subsequent assignment or
subletting. As Additional Rent hereunder, Tenant shall reimburse Landlord for
actual legal and other expenses reasonably incurred by Landlord in connection
with any request by Tenant for consent to assignment or subletting. In
connection with any proposed assignment or sublease, Tenant shall submit to
Landlord in writing (i) the name of the proposed assignee or sublessee, (ii)
such information as to such assignee's or sublessee's financial responsibility
and standing as Landlord may reasonably require; (iii) the proposed use of
Premises by such assignee or sublessee (iv) all of the terms and conditions upon
which the proposed assignment or subletting is to be made and (v) an instrument
of assignment or sublease wherein such assignee or sublessee assumes all of
Tenant's obligations hereunder and agrees to be bound by the terms hereof.
(b) EXCESS SUBLEASE RENTAL OR ASSIGNMENT CONSIDERATION. If for any
sublease or assignment, Tenant receives rent or other consideration either
initially or over the term of the sublease or assignment, in excess of (i) the
Monthly Rent called for hereunder, plus (ii) Tenant's direct out-of-pocket costs
which Tenant certifies to Landlord to have been incurred in providing
occupancy-related services to any such subtenant of a nature commonly provided
by landlords of similar space (or in case of the sublease of a portion of the
Premises, in excess of such Monthly Rent fairly allocable to such portion), then
promptly following its receipt thereof, Tenant shall pay to Landlord as
Additional Rent hereunder, fifty percent (50%) of such excess as and when
received. By initialling these provisions, Landlord and Tenant acknowledge and
agree that the provisions of this Paragraph are agreed to after negotiation:
/s/ RW /s/ DAVID S. SILVER
--------------------------- ----------------------------------
LANDLORD TENANT
(c) SCOPE. The prohibition against assigning or subletting contained in
this Paragraph shall be construed to include a prohibition against any
assignment or subletting by operation of law, whether voluntary or involuntary.
If this Lease be assigned, or if the underlying beneficial interest of Tenant be
transferred, or if the Premises or any part thereof be sublet or occupied by
anybody other than Tenant, Landlord may collect rent from the assignee,
subtenant or occupant and apply the net amount collected to the Monthly Rent
herein reserved and apportion any excess rent so collected in accordance with
the terms of Paragraph 24(b) above, but no such assignment, subletting,
occupancy or collection shall be deemed a waiver of this covenant or the
acceptance of the assignee, subtenant or occupant as tenant, or a release of
Tenant from the further performance by Tenant of covenants on the part of Tenant
herein contained. No assignment or subletting shall affect the continuing
primary liability of Tenant (which, following assignment, shall be joint and
several with the assignee), and Tenant shall not be released from performing any
of the terms, covenants and conditions of this Lease. No consent of Landlord
shall be required, however in connection with the merger or consolidation of
Tenant or the sale of substantially all of the assets or [MISSING TEXT].
(d) WAIVER. Notwithstanding any assignment or sublease, or any
indulgences, waivers or extensions of time granted by Landlord to any assignee
or sublessee, or failure by Landlord to take action against any assignee or
sublessee, Tenant waives notice of any default of any assignee or sublessee and
agrees that Landlord may at its option, proceed against Tenant without having
taken action against or joined such assignee or sublessee, except that Tenant
shall have the benefit of any indulgences, waivers and extensions of time
granted to any such assignee or sublessee and except that Landlord shall give
Tenant all notices of default given to the assignee or sublessee and Tenant
shall [MISSING TEXT].
25. CONSTRUCTION OF TENANT IMPROVEMENTS.
(a) PRELIMINARY PLANS/WORKING PLANS. Landlord has retained Donald W.
Mueller, A.I.A. to prepare preliminary space plans ("Preliminary Plans") to be
utilized in the preparation of final working drawings and specifications for
tenant improvements to the Premises ("Tenant Improvements"). The Preliminary
Plans have been completed and delivered to Landlord and are attached hereto as
"Exhibit C." Within five (5) days after execution of the Lease, Landlord shall
return same to Tenant marked and accompanied by comments and such required
revisions as are reasonable under the circumstances. Within five (5) days
thereafter, Tenant shall submit two (2) sets of revised Preliminary Plans,
revised to reflect review and approval. Promptly following Landlord's approval
of the Preliminary Plans, Landlord shall cause its architect to prepare and
submit two (2) copies of working drawings and specifications ("Working Plans")
to Tenant for its review and approval. Tenant shall advise Landlord within five
(5) days of Tenant's receipt of the Working Plans of any requested revisions.
Immediately upon receipt of said comments, Landlord shall make all approved
revisions to the Working Plans and submit two (2) copies thereof to Tenant for
its final review and approval. Concurrently with the above review and approval
process, Landlord shall submit all plans and specifications to the City and
other applicable governmental agencies in an attempt to expedite City approval
and issuance of all necessary permits and licenses to construct the Tenant
Improvements as shown on the Working Plans.
(b) CONSTRUCTION OF TENANT IMPROVEMENTS. Landlord at its own cost
(except as otherwise provided in Paragraphs 25(c) and (d) below) shall, through
a guaranteed maximum cost construction contract ("Construction Contract") with a
reputable, licensed contractor ("Contractor"), cause the construction of the
Tenant Improvements to be carried out in substantial conformance with the
Working Plans in a good and workmanlike manner and will use only first-class
materials. Tenant shall have the right to review and approve the construction
cost breakdown, including any and all fees, contained in the Construction
Contract. Landlord shall see that the construction complies with all applicable
building, fire, health and sanitary codes and regulations, the satisfaction of
which shall be evidenced by a certificate of occupancy for the Premises.
Landlord shall use best efforts to obtain all necessary construction and
building permits and licenses necessary for the construction of the Tenant
Improvements.
(c) ALLOWANCE. Landlord agrees to provide Tenant a tenant improvement
allowance in the amount of Three Hundred Eighty Thousand Five Hundred and 00/100
Dollars ($380,500) (the "Allowance") for the construction of the Tenant
Improvements for the entire Premises (which costs shall include, without
limitation, any and all fees, charges, costs or expenses of any kind or nature
reasonably incurred by Landlord in connection with the construction and
completion of the Tenant Improvements but excluding the costs of construction or
completion of the shell building. Upon finalization of the Construction Contract
with Contractor, if the sum of the guaranteed maximum cost of the Construction
Contract and other costs and expenses for the Tenant Improvements which are
chargeable against the Allowance exceed the Allowance ("Excess Cost"), Tenant
shall elect to either: (i) concurrent with Landlord's payment of funds form the
Allowance, pay to Landlord an amount equal to the product of the amount due the
Contractor times the ratio that the Excess Cost bears to the guaranteed maximum
contract amount; SEE PAGE 8-A.
(d) CHANGE ORDERS. Tenant may from time to time request and obtain
change orders during the course of construction provided that: (i) each such
request shall be reasonable; (ii) each such request shall be in writing and
signed by or on behalf of Tenant; (iii) each such request shall not result in
any structural change in the Building as reasonably determined by Landlord; (iv)
all additional charges and costs, including without limitation architectural and
engineering costs, construction and materials costs, and City processing costs,
shall be the sole and exclusive obligation of Tenant; and (v) any resulting
delay in the completion of the Tenant Improvements shall in no event extend the
Commencement Date of the Lease. Upon Tenant's request for a change order,
Landlord shall as soon as reasonably possible submit to Tenant a written
estimate of the increased (or decreased) cost and anticipated delay, if any,
attributable to the requested change. Within three (3) days of the date such
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<PAGE> 12
Page 8-A
The following is added to the end of Paragraph 25 Section (c) Allowance, where
indicated:
... or (ii) agree that Monthly Rent shall be increased so as to fully amortize
the Excess Cost over the Initial Term of the Lease at a rate of twelve percent
(12%) per annum, compounded annually; provided that any Excess Costs exceeding
$60,000 shall not be amortized but instead shall be paid to Landlord at the
Commencement Date.
Landlord agrees to begin construction on the 15,544 square feet of the
Designated Premises as noted in Exhibit A upon execution of the Lease. Landlord
further agrees to begin construction on the 4,091 square feet of the Designated
Premises as noted in Exhibit A within nine (9) months of the Lease Commencement
Date.
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<PAGE> 13
estimated cost adjustment and delay are delivered to Tenant, Tenant shall
advise Landlord whether or not it wishes to proceed with the change order.
Unless Tenant includes in its initial change order request that work in process
at the time such request is made be halted pending approval and execution of a
change order, Landlord shall not be obligated to stop construction of the
Tenant Improvements, whether or not the change order relates to work then in
process or about to be started.
(e) Tenant Delays. In no event shall the Commencement Date be extended
due to a delay due to the fault of Tenant. Delays "due to the fault" of Tenant
shall include, without limitation, delays caused by: (i) Tenant's failure to
timely prepare, submit and revise the Preliminary Plans and to review and
approve the Working Plans or to furnish information to Landlord for the
preparation by Landlord of the Working Plans; (ii) Tenant's request for or use
of special materials, finishes or installments which are not readily available,
provided that Landlord shall notify Tenant in writing that the particular
material, finish, or installation was not readily available promptly upon
Landlord's discovery of same; (iii) Tenant's failure to reasonably approve the
Working Plans in accordance with this Addendum; (iv) change orders requested by
Tenant; or (v) interference with Landlord's construction activities, caused by
Tenant or by Tenant's agents, employees, contractors or subcontractors.
Landlord shall give Tenant written notice within a reasonable time of any
circumstances that Landlord believes constitute delay caused by Tenant.
26. Default.
(a) Tenant's Default. At the option of Landlord, a default under this
Lease by Tenant shall exist if any of the following events shall occur: (i) if
Tenant shall have failed to pay Monthly Rent or any other sum required to be
paid hereunder within ten (10) days when due and within three (3) days of
written notice from landlord; (ii) if Tenant shall have failed to perform any
term, covenant or condition of this Lease other than those requiring the payment
of money, and Tenant shall have failed to cure such failure within fifteen (15)
days after written notice from Landlord where such failure could reasonably be
cured within such fifteen (15) day period; provided, however, that where such
failure could not reasonably be cured within the fifteen (15) day period, that
Tenant shall not be in default if it has commenced such cure within the fifteen
(15) day period and diligently thereafter prosecutes the same to completion
which in all events must occur within sixty (60) days thereafter; (iii) if
Tenant shall have assigned its assets for the benefit of its creditors; (iv) if
the sequestrian or attachment of or execution on any material part of Tenant's
Personal Property essential to the conduct of Tenant's business shall have
occurred, and Tenant shall have failed to obtain a return or release of Tenant's
Personal Property within thirty (30) days thereafter, or prior to sale pursuant
to such sequestration, attachment or levy, whichever is earlier; (v) if Tenant
shall have failed to continuously or uninterruptedly conduct its business in the
Premises, or shall have abandoned or vacated the Premises; (vi) if a court shall
have made or entered any decree or order other than under the bankruptcy laws of
the United States or any state adjudging Tenant to be insolvent; or approving as
properly filed a petition seeking reorganization of Tenant; or directing the
winding up or liquidation of Tenant and such decree or order shall have
continued for a period of thirty (30) days; (vii) the filing of a voluntary
petition in bankruptcy by Tenant, a voluntary petition for arrangement, a
voluntary or involuntary petition for reorganization, or the filing of an
involuntary petition by Tenant's creditors, immediately (unless involuntary, in
which case when the petition remains undischarged for a period of sixty (60)
days); (viii) if Tenant shall have failed to timely comply with the provisions
of Paragraphs 27 or 30 of this Lease.
(b) Remedies. Upon a default, Landlord shall have the following
remedies, in addition to all other rights and remedies provided by law in
equity or otherwise provided in this Lease, to which Landlord may resort
cumulatively or in the alternative; (i) Landlord may continue this Lease in
full force and effect and this Lease shall continue in full force and effect
as long as Landlord does not terminate this Lease, and Landlord shall have the
right to collect Rent when due; (ii) Landlord may, with or without terminating
this Lease, re-enter the Premises and remove all persons and property from the
Premises; such property may be removed and stored in a public warehouse or
elsewhere at the cost of and for the account of tenant. No re-entry or taking
possession of the Premises by Landlord pursuant to this Paragraph shall be
construed as an election to terminate this Lease unless a written notice of
such intention is given to Tenant; (iii) Landlord may terminate Tenant's right
to possession of the Premises at any time by giving written notice to that
effect, and relet the Premises or any part thereof. Tenant shall be liable
immediately to Landlord for all costs Landlord incurs in reletting the Premises
or any part thereof, including, without limitation, brokers' commissions which
Landlord would not otherwise be required to pay, expenses of cleaning,
redecorating, and further improving the Premises and like costs. Reletting may
be for a period shorter or longer than the remaining Term of this Lease. No
act by Landlord other than giving written notice to Tenant shall terminate this
Lease. Acts of maintenance efforts to relet the Premises or the appointment of
a receiver on Landlord's initiative to protect Landlord's interest under this
Lease shall not constitute a termination of Tenants right to possession. Upon
termination, Landlord shall have the right to remove all of Tenant's Personal
Property and store same at Tenant's cost and to recover from Tenant as damages
(A) the worth at the time of award of any unpaid Rent and other sums due and
payable which had been earned at the time of termination, plus (B) the worth at
the time of award of the amount by which the unpaid Rent and other sums which
would have been payable after termination until the time of award exceeds the
amount of such Rent loss that Tenant proves could have been reasonably avoided,
plus (C) the worth at the time of award of the amount by which the unpaid Rent
and other sums due for the balance of the Term after the time of award exceeds
the amount of such Rent loss that Tenant proves could be reasonably avoided,
plus (D) any other amounts to compensate Landlord for all the detriment
proximately caused by Tenant's failure to perform Tenant's obligations under
this Lease, or which in the ordinary course of things, would be likely to
result therefrom, including, without limitation, any costs or expenses
incurred by Landlord, (i) in retaking possession of the Premises; (ii) in
maintaining, repairing, preserving, restoring, replacing, cleaning, altering or
rehabilitating the Premises or any portion thereof, including such acts for
reletting to a new tenant or tenants; (iii) for leasing commissions; or (iv)
for any other costs necessary or appropriate to relet the Premises; plus (E) at
Landlord's election, such other amounts and remedies in addition to or in lieu
of the foregoing as may be permitted from time to time by the laws of the State
of California including, without limitation, the remedies provided by
California Civil Code Section 1951.4, as amended from time to time.
The "worth at the time of award" of the amounts referred to in
Paragraphs 26(b)(iii)(A) and 26(b)(iii)(B) above is computed by allowing
interest at the interest Rate on the unpaid Rent and other sums due and payable
from the termination date through the date of award. The "worth at the time of
award" of the amount referred to in Paragraph 26(b)(iii)(C) is computed by
discounting such amount at the discount rate of the Federal Reserve Bank of San
Francisco at the time of award plus one percent (1%). Tenant waives redemption
or relief from forfeiture under California Code of Civil Procedure Sections
1174 and 1179, or under any other present or future law, in the event Tenant
is evicted or Landlord takes possession of the Premises by reason of any
default of Tenant hereunder.
(c) Landlord's Default. Landlord shall not be deemed to be in default
in the performance of any obligation required to be performed by it hereunder
unless and until it has failed to perform such obligation within thirty (30)
days after receipt of written notice by Tenant to Landlord (and its lender(s)
of record who have provided Tenant with notice) specifying the nature of such
default; provided, however, that if the nature of Landlord's obligation is such
that more than thirty (30) days are required for its performance, then Landlord
shall not be deemed to be in default if it shall commence such performance
within such thirty (30) day period and thereafter diligently prosecute the
same to completion.
27. Subordination. Without the necessity of any additional document being
executed by Tenant for the purpose of effecting a subordination, and at the
election of Landlord or any bona fide mortgage or deed of trust beneficiary
with a lien on all or any portion of the Premises or any ground lessor with
respect to the land or which the Premises are a part, this Lease shall be
subject and subordinate at all times to; (i) all ground leases or underlying
leases which may now exist or hereafter be executed affecting the Building or
the land upon which the Building is situated or both, and (ii) the lien of any
mortgage or deed of trust which may now exist or hereafter be executed in any
amount for which the Building, land, ground leases or underlying leases, or
Landlord's interest or estate in any of said items is specified as security.
Notwithstanding the foregoing, Landlord or any such ground lessor, mortgagee,
any beneficiary shall have the right to subordinate or cause to be subordinated
any such ground leases or underlying leases or any such liens to this Lease.
If any ground lease or underlying lease terminates for any reason or any
mortgage or deed of trust is foreclosed or a conveyance in lieu of foreclosure
is made for any reason, Tenant shall, notwithstanding any subordination and
upon the request of such successor in interest to Landlord, attorn to and
become the Tenant of the successor in interest to Landlord. Tenant covenants
and agrees to execute and deliver, within ten (10) days of demand by Landlord
and in the form requested by Landlord, ground lessor, mortgage or beneficiary,
any additional documents evidencing the priority or subordination of this Lease
with respect to any such ground leases or underlying leases or the lien of any
such mortgage or deed of trust. Tenant's failure to timely execute and deliver
such additional documents shall, at Landlord's option, constitute an additional
default hereunder. Tenant hereby irrevocably appoints Landlord as
attorney-in-fact of Tenant, which appointment is coupled with an interest, to
execute, deliver and record any such documents in the name and on behalf of
Tenant.
28. Notices. Any notice or demand required or desired to be given under
this Lease shall be in writing and shall be personally served or in lieu of
personal service may be given by mail, if given by mail, such notice shall be
deemed to have been given when seventy-two (72) hours have elapsed from the
time when such notice was deposited in the United States mail, registered or
certified, postage prepaid, return receipt requested, addressed to the party
to be served. At the date of execution of this Lease, the addresses of
Landlord and Tenant are as set forth in Paragraph 1. After the Commencement
Date, the address of tenant shall be the address of the Premises. Either party
may change its address by giving notice of same in accordance with this
Paragraph.
9
<PAGE> 14
29. ATTORNEYS' FEES. If either party brings any action or legal proceeding
for damages for an alleged breach of any provision of this Lease, to recover
Rent or other sums due, to terminate this Lease or to enforce, protect or
establish any term, condition or covenant of this Lease or the right of either
party hereunder or at law, the prevailing party shall be entitled to recover as
a part of such action or proceedings, or in a separate action brought for that
purpose, actual attorneys' fees and costs.
30. ESTOPPEL CERTIFICATE. Tenant shall within ten (10) days following
written request by Landlord:
(a) TENANT OBLIGATIONS. Execute and deliver to Landlord any documents,
including estoppel certificates, in a form prepared by Landlord (i) certifying
that this Lease is unmodified and in full force and effect or, if modified,
stating the nature of such modification and certifying that this Lease, as so
modified, is in full force and effect and the date to which the Rent and other
charges are paid in advance, if any; (ii) acknowledging that there are not, to
Tenant's knowledge, any uncured defaults on the part of the Landlord or stating
the nature of any uncured defaults; (iii) evidencing the status of the Lease as
may be required by a lender making a loan to Landlord to be secured by deed of
trust or mortgage covering the Premises or a purchaser of the Premises from
Landlord; (iv) certifying the current Monthly Rent amount and the amount and
form of Security Deposit on deposit with Landlord; and (v) certifying to such
other information as Landlord, Landlord's Agents, mortgagees, prospective
mortgagees and purchasers may reasonably request.
Tenant's failure to deliver an estoppel certificate within ten (10) days
after delivery of Landlord's written request therefor shall be conclusive upon
Tenant (i) that this Lease is in full force and effect, without modification
except as may be represented by Landlord; (ii) that there are now no uncured
defaults in Landlord's performance; (iii) that not more than one (1) month's
Monthly Rent has been paid in advance; and (iv) that the other information
requested by Landlord is correct as stated in the form presented by Landlord.
Tenant hereby irrevocably appoints Landlord as Tenant's attorney-
in-fact, which appointment is coupled with an interest, to act in Tenant's name,
place and stead to execute such estoppel certificate on Tenant's behalf.
(b) FINANCIAL INFORMATION. Deliver to Landlord the current financial
statements of Tenant, and financial statements of the two (2) years prior to the
current financial statement's year, certified to be true, accurate and completed
by the chief financial officer of Tenant, including a balance sheet and profit
and loss statement for the most recent prior year, which statements shall be
prepared on an accrual basis and accurately and completely reflect the financial
condition of Tenant. Landlord agrees that it will keep such financial statements
confidential and will use its best efforts to request confidentiality of
Tenant's financial statements when delivered to any proposed purchaser of the
Premises, the Project or any portion thereof and to the mortgagees or
beneficiaries of Landlord or such purchaser.
31. TRANSFER OF THE PREMISES BY LANDLORD. Upon any conveyance of the
Premises and assignment by Landlord of this Lease, Landlord shall be and is
hereby entirely released from all liability under any and all of its covenants
and obligations contained in or derived from this Lease occurring after the date
of such conveyance and assignment, and Tenant agrees to attorn to any entity
purchasing or otherwise acquiring the Premises.
32. LANDLORD'S RIGHT TO PERFORM TENANT'S COVENANTS. If Tenant shall at any
time fail to make any payment or perform any other act on its part to be made or
performed under this Lease, Landlord may, but shall not be obligated to and
without waiving or releasing Tenant from any obligation of Tenant under this
Lease, make such payment or perform such other act to the extent Landlord may
deem desirable, and in connection therewith, pay expenses and employ counsel.
All sums so paid by Landlord and all penalties, interest and costs in connection
therewith shall be due and payable by Tenant to Landlord on the next day after
such payment by Landlord, plus collection costs and attorneys' fees. Landlord
shall have the same rights and remedies for the nonpayment thereof as in the
case of default in the payment of Rent.
33. TENANT'S REMEDY. The obligations of Landlord do not constitute the
personal obligation of the individual partners, trustees, directors, officers or
shareholders of Landlord or its constituent partners. If Landlord shall fail to
perform any covenant, term, or condition of this Lease upon Landlord's part to
be performed, Tenant shall be required to deliver to Landlord written notice of
the same. if, as a consequence of such default, Tenant shall recover a money
judgment against Landlord, such judgment shall be satisfied only out of the
proceeds of sale received upon execution of such judgment and levied thereon
against the right, title and interest of Landlord in the Premises and out of
Rent or other income from such property receivable by Landlord or out of
consideration received by Landlord from the sale or other disposition of all or
any part of Landlord's right, title or interest in the Premises, and no action
for any deficiency may be sought or obtained by Tenant.
34. MORTGAGEE PROTECTION. Upon any default on the part of Landlord, Tenant
will give notice by registered or certified mail to any beneficiary of a deed of
trust or mortgagee of a mortgage covering the Premises who has provided Tenant
with notice of their interest together with an address for receiving notice, and
shall offer such beneficiary or mortgagee a reasonable opportunity to cure the
default (which, in no event shall be less than ninety (90) days), including time
to obtain possession of the Premises by power of sale or a judicial foreclosure,
if such should prove necessary, to effect a cure. Tenant agrees that each lender
to whom this Lease has been assigned by Landlord is an express third party
beneficiary hereof. Tenant shall not make any prepayment of Monthly Rent more
than one (1) month in advance without the prior written consent of each such
lender. Tenant waives the collection of any deposit from such lender(s) or any
purchaser at a foreclosure sale of such lender(s)' deed of trust unless the
lender(s) or such purchaser shall have actually received and not refunded the
deposit. Tenant agrees to make all payments under the Lease to the lender with
the most senior encumbrance upon receiving direction, in writing, to pay said
amounts to such lender. Tenant shall comply with such written direction to pay
without determining whether an event of default exists under such lender's loan
to Landlord.
35. BROKERS. Landlord and Tenant each warrant and represent to the other
that neither has had any dealings with any real estate broker, agent or finder
in connection with the negotiation of this Lease or the introduction of the
parties to this transaction, except for the brokers identified in Paragraph (o)
of the Lease Summary, and that it knows of no other real estate broker, agent or
finder who is or might be entitled to a commission or fee in connection with
this Lease. In the event of any such additional claims for brokers' or finders'
fees with respect to this Lease, then Tenant shall indemnify, save harmless and
defend Landlord from and against such claims if they shall be based upon any
statement or representation or agreement by Tenant, and Landlord shall
indemnify, save harmless and defend Tenant if such claims shall be based upon
any statement, representation or agreement made by Landlord.
36. EXAMINATION OF LEASE. Submission of this Lease for examination or
signature by Tenant does not create a reservation of or option to Lease. This
Lease shall only become effective and binding upon full execution hereof by both
Landlord and Tenant.
37. RECORDING. Tenant shall not record this Lease nor a short form
memorandum thereof without Landlord's prior written consent.
38. QUITCLAIM. Upon any termination of this Lease, Tenant shall, at
Landlord's request, execute, have acknowledged and deliver to Landlord a
quitclaim deed of the Premises.
39. MODIFICATIONS FOR LENDER. If in connection with obtaining financing for
the Premises or any portion thereof, Landlord's lender shall request reasonable
modification to this Lease as a condition to such financing. Tenant shall not
unreasonably withhold, delay or defer its consent thereto, provided such
modifications do not materially adversely affect Tenant's rights hereunder.
40. PARKING AND USE OF COMMON AREAS AND FACILITIES.
(a) GRANT OF NONEXCLUSIVE COMMON AREA LICENSE AND RIGHT. Landlord hereby
grants to Tenant and its successors and assigns, a nonexclusive license and
right for Tenant and its permitted subtenants, in common with Landlord and all
persons, firms and corporations conducting business in the Project and their
respective customers, guests, licensees, invitees, subtenants, employees and
agents, to use the Common Area within the Project for vehicular parking, for
pedestrian and vehicular ingress, egress, egress and travel, and for such other
purposes and for doing such other things as may be provided for, authorized
and/or permitted by the CC&R's and the REA, such nonexclusive license and right
to be appurtenant to Tenant's leasehold estate in and to the leased Premises
created by this Lease. The nonexclusive license and right granted pursuant to
the provisions of this Paragraph shall be subject to the CC&R's and the REA,
which pertain in any way to the Common Area covered by such encumbrances, and
the provisions of this Lease.
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<PAGE> 15
(b) USE OF COMMON AREA. Notwithstanding anything to the contrary herein,
Tenant agrees for itself and for its successors, assigns, employees and agents
that it and they shall use the Common Area within the Project only for the
purposes permitted hereby and by the CC&R's and the REA. It is understood that
all uses permitted within the Common Area shall be undertaken with reason and
judgment so as not to interfere with the primary use of said Common Area which
is to provide parking and vehicular and pedestrian access throughout the Common
Area within the Project and to adjacent public streets for the Landlord, its
tenants, subtenants and all persons, firms and corporations conducting business
within the Project and their respective customers, guests, and licensees. In no
event shall Tenant erect or cause to be erected any structure, building,
trailer, fence, wall, signs or other obstructions on the Common Area within the
Project except as otherwise permitted herein or by the CC&R's or by the REA, nor
shall Tenant store or sell any merchandise, equipment and/or materials on the
Common Area within the Project.
(c) CONTROL AND MAINTENANCE OF COMMON AREA.
(i) Subject to provisions of the CC&R's and the REA, it is
understood and agreed that all Common Area within the Project and all
improvements located from time to time within such Common Area are for the
general use, in common, of the Landlord and its tenants and subtenants and all
persons, firms and corporations conducting business in the Project and their
respective customers, guests, licensees, invitees, employees and agents, and
shall at all times be subject to the exclusive control and management of the
Landlord.
(ii) Landlord shall have the right to construct, maintain and
operate lighting facilities within the Common Area; to police the Common Area
from time to time; to change the area, level, location and arrangement of the
parking areas and other improvements within the Common Area; to restrict
parking by tenants, their officers, agents and employees to employee parking
areas; to enforce parking charges (by operation of meters or otherwise); to
close all or any portion of the Common Area or improvements therein to such
extent as may, in the opinion of counsel for Landlord, be legally sufficient to
prevent a dedication thereof or the accrual of any rights to any person or to
the public therein; to close temporarily all or any portion of the Common Area
and/or the improvements thereon; to discourage noncustomer parking; and to do
and perform such other acts in and to said Common Area and improvements thereon
as, in the use of good business judgment, Landlord shall determine to be
advisable. (See Rider No. 3)
(iii) Subject to the provisions of the CC&R's and the REA,
Landlord shall operate and maintain or cause to be operated and maintained, the
Common Area within the Project in such a manner as Landlord in its sole
discretion shall reasonably determine from time to time. Without limiting the
scope of such discretion, Landlord shall have the full right and authority to
employ or cause to be employed all personnel and to make or cause to be made
all rules and regulations pertaining to or necessary for the proper operation
and maintenance of the Common Area and the improvements located thereon.
(iv) It is hereby further agreed that the use of the Common
Area by Tenant, its permitted subtenants, if any, and their respective
customers, guests, licensees, invitees, employees and agents may and shall be
restricted such that no part of the Common Area may be used for the storage of
any items, including without limitation, vehicles, materials, inventory and/or
equipment. All trash and other refuse shall be placed in designated
receptacles. There shall be no continued overnight parking of any vehicles of
any kind, and vehicles which have been abandoned or parked in violation of the
terms hereof may be towed away at the owner's expense. No work of any kind,
including, without limitation, painting, drying, cleaning, repairing,
manufacturing, assembling, cutting, merchandising and/or displaying shall be
permitted. Parking within the Common Area shall be limited to striped parking
stalls, and no parking shall be permitted in any driveways, accessways and/or
in any area which would prohibit or impede the free flow of traffic within the
Common Area.
(v) Any use of the Common Area in violation of the restrictions
set forth hereinabove shall constitute a material default under this Lease.
(d) REVOCATION OF LICENSE. All Common Area and improvements located
therein which Tenant is permitted to use and occupy pursuant to the provisions
of this Lease are to be used and occupied under a revocable license and right,
and if any such license be revoked, or if the amount of such areas be
diminished, Landlord shall not be subject to any liability nor shall Tenant be
entitled to compensation or diminution or abatement of rent, nor shall such
revocation or diminution of such areas be deemed constructive or actual
eviction. It is understood and agreed that the condemnation or other taking or
appropriation by any public or quasi-public authority, or sale in lieu of
condemnation, of all or any portion of the Common Area within the Project,
shall not constitute a violation of Landlord's agreements hereunder, nor shall
Tenant be entitled to participate in or make any claim for any award or other
condemnation proceeds arising from any such taking or appropriation of the
Common Area.
(e) LANDLORD'S RESERVED RIGHTS. Provided Landlord does not unreasonably
interfere with Tenant's use of the Premises, Landlord reserves the right to
install, use, maintain, repair, relocate and replace pipes, ducts, conduits,
wires and appurtenant meters and equipment included in the Premises or outside
the Premises; change the boundary lines of the Project and install, use,
maintain, repair, alter or relocate, expand and replace any Common Area. Such
right of Landlord shall include, without limitation, designating from time to
time certain portion of the Common Area as exclusively for the benefit of
certain tenants in the Project.
41. GENERAL.
(a) CAPTIONS. The captions and headings used in this Lease are for the
purpose of convenience only and shall not be construed to limit or extend the
meaning of any part of this Lease.
(b) EXECUTED COPY. Any fully executed copy of this Lease shall be
deemed an original for all purposes.
(c) TIME. Time is of the essence for the performance of each term,
condition and covenant of this Lease.
(d) SEVERABILITY. If any one (1) or more of the provisions contained
herein shall for any reason be held to be invalid, illegal or unenforceable in
any respect, such invalidity, illegality, or unenforceability shall not affect
any other provision of this Lease, but this Lease shall be construed as if such
invalid, illegal or unenforceable provision had not been contained herein.
(e) CHOICE OF LAW. This Lease shall be construed and enforced in
accordance with the laws of the State of California. The language in all parts
of this Lease shall in all cases be construed as a whole according to its fair
meaning and not strictly for or against either Landlord or Tenant.
(f) GENDER; SINGULAR, PLURAL. When the context of this Lease requires,
the neuter gender includes the masculine, the feminine, a partnership or
corporation or joint venture, and the singular includes the plural.
(g) BINDING EFFECT. The covenants and agreements contained in this
Lease shall be binding on the parties hereto and on their respective successors
and assigns to the extent this Lease is assignable.
(h) WAIVER. The waiver by Landlord of any breach of any term, condition
or covenant, of this Lease shall not be deemed to be a waiver of such provision
or any subsequent breach of the same or any other term, condition or covenant of
this Lease. The subsequent acceptance of Rent hereunder by Landlord shall not be
deemed to be a waiver of any preceding breach at the time of acceptance of such
payment. No covenant, term or condition of this Lease shall be deemed to have
been waived by Landlord unless such waiver is in writing signed by Landlord.
(i) ENTIRE AGREEMENT. This Lease is the entire agreement between the
parties, and supersedes and prior agreements, representations, negotiations or
correspondence between the parties except as expressed herein. Except as
otherwise provided herein no subsequent charge or addition to this Lease shall
be binding unless in writing and signed by the parties hereto.
(j) AUTHORITY. If Tenant is a corporation or a partnership, each
individual executing this Lease on behalf of said corporation or partnership,
as the case may be, represents and warrants that he is duly authorized to
execute and deliver this Lease on behalf of said entity in accordance with its
corporate bylaws, statement of partnership or certificate of limited
partnership, as the case may be, and that this Lease is binding upon said
entity in accordance with its terms. Landlord, at its option, may require a
copy of such written authorization to enter into this Lease. The failure of
Tenant to deliver the same to Landlord within seven (7) days of Landlord's
request therefor shall be deemed a default under this Lease.
(k) EXHIBITS. All exhibits, amendments riders and addenda attached
hereto are hereby incorporated herein and made a part hereof.
(l) LEASE SUMMARY. The Lease Summary at the beginning of this Lease is
intended to provide general information only. In the event of any inconsistency
between the Lease Summary and the specific provisions of this Lease, the
specific provisions of this Lease shall prevail.
----------------------
* "continued" means: not more than four (4) nights in a row without
interruption.
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<PAGE> 16
(m) Approved Truck Route. Tenant understands and agrees to comply with
certain restrictions imposed by the Orange County Board of Supervisors on
vehicles with gross vehicle weight equal to or greater than seven (7) tons
whereby trucks entering and leaving the Premises from the Lake Forest
Interchange of the San Diego Freeway shall utilize only the following truck
route: Lake Forest to Rockfield to Bake Parkway to Muirlands to Alton to Toledo
to Parker. Tenant also agrees to cause its employees and use best efforts to
cause agents to comply with this restriction and to advise its contractors,
vendors and customers of this restriction.
THIS LEASE is effective as of the date the last signatory necessary to
execute the Lease shall have executed this Lease.
"LANDLORD" THE IRVINE COMPANY
--------------------------------------------
a Michigan corporation
--------------------------------------------
--------------------------------------------
By /s/ RICHARD G. SIM
--------------------------------------
Richard G. Sim
Its Vice President
--------------------------------------
By /s/ ROBERT E. WILLAMS, JR.
--------------------------------------
Robert E. Williams, Jr.
Its Assistant Secretary
--------------------------------------
"TENANT" KOFAX IMAGE PRODUCTS, INC.
--------------------------------------------
a California corporation
--------------------------------------------
--------------------------------------------
By /s/ DAVID SILVER 5/10/88
--------------------------------------
David Silver
Its President
--------------------------------------
By /s/ DEAN A. HOUGH 5/10/88
--------------------------------------
Dean A. Hough
Its Secretary
--------------------------------------
(n) Consents and Approvals. In the event any term or provision of this Lease
requires the consent, approval or determination by either party hereto,
unless otherwise specifically provided within specific provisions of this
Lease, such consent approval shall not be unreasonably withheld and such
determination shall be reasonably made,
12
<PAGE> 17
EXHIBIT A
DESCRIPTION OF PREMISES
This Exhibit is hereby attached to and made a part of the Lease dated:
March 31, 1988 by and between THE IRVINE COMPANY, a Michigan corporation, as
Landlord and KoFAX IMAGE PRODUCTS, INC., a California corporation, as Tenant for
the Premises known as 3 Jenner Street, Suite 100, Irvine, California.
[DIAGRAM]
13
<PAGE> 18
EXHIBIT B
DESCRIPTION OF PROJECT
This Exhibit is hereby attached to and made a part of the Lease dated:
March 31, 1988, by and between THE IRVINE COMPANY, a Michigan corporation, as
Landlord and KoFAX IMAGE PRODUCTS, INC., a California corporation, as Tenant for
the Premises known as 3 Jenner Street, Suite 100, Irvine, California.
[DIAGRAM]
14
<PAGE> 19
EXHIBIT C
TENANT IMPROVEMENTS PRELIMINARY PLANS
This Exhibit is hereby attached to and made a part of the Lease dated:
March 31, 1988, by and between THE IRVINE COMPANY, a Michigan corporation, as
Landlord and KoFAX IMAGE PRODUCTS, INC., a California corporation, as Tenant for
the Premises known as 3 Jenner Street, Suite 100, Irvine, California.
[DIAGRAM]
15
<PAGE> 20
EXHIBIT D
COMMENCEMENT DATE MEMORANDUM
To.:______________________________________________ Date: _____________________
RE: Lease dated March 31, 1988, by and between THE IRVINE COMPANY, a
Michigan corporation, as Landlord and KoFAX IMAGE PRODUCTS, INC., a
California corporation, as Tenant concerning Premises located at 3 Jenner
Street, Suite 100, Irvine California.
Gentlemen:
In accordance with the subject Lease, the undersigned hereby agree:
1. That the Improvements to the Premises have been substantially completed
in accordance with the subject Lease, subject to the punch list items
agreed to by the parties pursuant to the terms and provisions of the
Lease.
2. Under the provisions of the subject Lease, the Commencement Date of
said Lease is ________________________________________________________.
3. That in accordance with the subject Lease, Monthly Rent commences to
accrue on ____________________________________________________________.
4. Rent in the amount of ________________________________________________
Dollars ($___________), subject to adjustment in accordance with the
terms of the subject Lease, is due and payable in advance on the first
day of each and every month during the Term of said Lease. Rent checks
should be made payable to _____________________________________________
at ___________________________________________________________________.
LANDLORD: THE IRVINE COMPANY
a Michigan corporation
By:
--------------------------------------
Richard G. Sim
Its Vice President
--------------------------------------
By:
--------------------------------------
Robert E. Williams, Jr.
Its Assistant Secretary
--------------------------------------
TENANT: KoFAX IMAGE PRODUCTS, INC.
a California corporation
By:
--------------------------------------
David Silver
Its President
--------------------------------------
By:
--------------------------------------
Dean A. Hough
Its Secretary
--------------------------------------
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<PAGE> 21
EXHIBIT E
RENT ADJUSTMENTS
This Exhibit is hereby attached to and made a part of the Lease dated:
March 31, 1988, by and between THE IRVINE COMPANY, a Michigan corporation, as
Landlord and KoFAX IMAGE PRODUCTS, INC., a California corporation, as Tenant for
the Premises known as 3 Jenner Street, Suite 100, Irvine, California.
<CAPTION>
YEAR MONTHS FROM COMMENCEMENT DATE MONTHLY RENTAL RATE
---- ----------------------------- -------------------
1 Month 1 through 12 $20,431 per month
2 Months 13 through 24 $20,431 per month
3 Months 25 through 36 $22,002 per month
4 Months 37 and 38 $22,002 per month
(See Rider No. 1)
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<PAGE> 22
EXHIBIT G
RULES AND REGULATIONS
This Exhibit is hereby attached to and made a part of the Lease dated:
March 31, 1988, by and between THE IRVINE COMPANY, a Michigan corporation, as
Landlord and KoFAX IMAGE PRODUCTS, INC., a California corporation, as Tenant for
the Premises known as 3 Jenner Street, Suite 100, Irvine, California.
1. No sidewalks, entrances, passages, courts, elevators, vestibules,
stairways, corridors, or halls shall be obstructed or encumbered by Tenant or
used for any purpose other than ingress and egress to and from Demised Premises
of the Building and if Demised Premises is situated on the ground floor of the
Building, Tenant shall further, at Tenant's own expense, keep the sidewalks and
curb directly in front of Demised Premises clean and free from rubbish.
2. No awning or other projection shall be attached to the outside walls
or windows of the Building without the prior written consent of Landlord. No
curtains, blinds, shades, drapes, or screens shall be attached to or hung in, or
used in connection with any window or door of Demised Premises, without the
prior written consent of Landlord. Such awnings, projections, curtains, blinds,
shades, drapes, screens, and other fixtures must be of a quality, type, design,
color, material, and general appearance approved by Landlord, and shall be
attached in the manner approved by Landlord. All electrical fixtures hung in
offices or spaces along the perimeter of Demised Premises must be fluorescent,
of a quality, type, design, bulb color, size, and general appearance approved by
Landlord.
3. No sign, advertisement, notice, or other lettering shall be
exhibited, inscribed, painted, or affixed by Tenant on any part of the outside
or inside of Demised Premises or of the Building without the prior written
consent of Landlord. In the event of the violation of the foregoing by Tenant,
Landlord may remove same without any liability, and may charge the expense
incurred by such removal to Tenant. Interior signs on doors and directory
tablet shall be inscribed, painted, or affixed for Tenant by Landlord at the
expense of Tenant, and shall be of a quality, quantity, type, design, color,
size, style, composition, material, location, and general appearance acceptable
to Landlord.
4. The sashes, sash doors, skylights, windows, and doors that reflect or
admit light or air into the halls, passageways, or other public places in the
Building shall not be covered or obstructed by Tenant, nor shall any bottles,
parcels, or other articles be placed on the window sills, or in the public
portions of the Building.
5. No showcases or other articles shall be put in front of or affixed to
any part of the exterior of the Building, nor placed in public portions thereof
without the prior written consent of Landlord.
6. The water and wash closets and other plumbing fixtures shall not be
used for any purposes other than those for which they were constructed, and no
sweepings, rubbish, rags, or other substances shall be thrown therein. All
damages resulting from any misuse of the fixtures shall be borne by Tenant to
the extent that Tenant or Tenant's agents, servants, employees, contractors,
visitors, or licensees shall have caused the same.
7. Tenant shall not mark, paint, drill into, or in any way deface any
part of Demised Premises or the Building. No boring, cutting, or stringing of
wires shall be permitted, except with the prior written consent of Landlord, and
as Landlord may direct.
8. No animal or bird of any kind shall be brought into or kept in or
about Demised Premises or the Building.
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<PAGE> 23
9. Tenant shall not make, or permit to be made, any unseemly or
disturbing noises or disturb or interfere with occupants of the Building or
neighboring buildings or premises or those having business with them. Tenant
shall not throw anything out of the doors, windows, or skylights or down the
passageways.
10. Neither Tenant nor any of Tenant's agents, servants, employees,
contractors, visitors, or licensees shall at any time bring or keep upon Demised
Premises any flammable, combustible, or explosive fluid, chemical, or substance.
11. No additional locks, bolts, or mail slots of any kind shall be
placed upon any of the doors or windows by Tenant, nor shall any change be made
in existing locks or the mechanism, thereof. Tenant must, upon the termination
of the tenancy, restore to Landlord all keys of stores, offices, and toilet
rooms, either furnished to, or otherwise procured by Tenant, and in the event of
the loss of any keys so furnished, Tenant shall pay to Landlord the cost
thereof.
12. All removals, or the carrying in or out of any safes, freights,
furniture, fixtures, bulky matter, or heavy equipment of any description must
take place during the hours which Landlord or its agent may determine from time
to time. Landlord reserves the right to prescribe the weight and position of all
safes, which must be placed upon two-inch thick plank strips to distribute the
weight. The moving of safes, freight, furniture, fixtures, bulky matter, or
heavy equipment of any kind must be made upon previous notice to the
Superintendent of the Building and in a manner and at times prescribed by him,
and the persons employed by Tenant for such work are subject to Landlord's prior
approval. Landlord reserves the right to inspect all safes, freight, or other
bulky articles to be brought into the Building and to exclude from the Building
all safes, freight, or other bulky articles which violate any of these Rules and
Regulations or the Lease of which these Rules and Regulations are a part.
13. Tenant shall not occupy or permit any portion of Demised Premises to
be occupied as an office that is not generally consistent with the character and
nature of an ordinary desk-type office. Nor shall Tenant permit any portion of
the Demised Premises to be used (a) for an employment agency, a public
stenographer or typist, a labor union office, a physician's or dentist's office,
a dance or music studio, a school, a beauty salon or barber shop, the business
of photographic or multilith reproductions or offset printing (not precluding
using any part of Demised Premises for photographic, multilith, or multigraph
reproductions solely in connection with Tenant's own business and/or
activities), a restaurant or bar, an establishment for the sale of confectionery
or soda or beverages or sandwiches or ice cream or baked goods, an establishment
for the preparation or dispensing or consumption of food or beverages (of any
kind) in any manner whatsoever, or as a news or cigar stand, or as a radio or
television or recording studio, theatre, or exhibition hall, for manufacturing,
for the storage of merchandise, or for the sale of merchandise, goods, or
property of any kind at auction, or for lodging, sleeping, or for any immoral
purpose, or for any business which would tend to generate a large amount of foot
traffic in or about the Building or the land upon which it is located, or any of
the areas used in the operation of the Building, including but not limited to
any use (i) for a banking, trust company, depository, guarantee, or safe deposit
business, (ii) as a savings bank, or a savings and loan association, or as a
loan company, (iii) for the sale of travelers checks, money orders, drafts,
foreign exchange, or letters of credit or for the receipt of money for
transmission, (iv) as a stock broker's or dealer's office or for the
underwriting of securities, or (v) a government office or foreign embassy or
consulate, or (vi) tourist or travel bureau, or (b) a use which conflicts with
any so-called "exclusive" then in favor of, or is for any use the same as that
stated in any percentage lease to, another tenant of the Building or the Park,
or (c) a use which would be prohibited by any other portion of this Lease
(including but not limited to any Rules and Regulations then in effect) or in
violation of law. Tenant shall not engage or pay any employees on Demised
Premises, except those actually working for Tenant on Demised Premises nor shall
Tenant advertise for laborers giving any address at Demised Premises.
14. Landlord shall have the right to prohibit any advertising or
business conducted by Tenant referring to the Building or the Park which, in
Landlord's opinion, tends to impair the reputation of the Building or its
desirability as a first-class building for offices, or the Park, and upon notice
from Landlord, Tenant shall refrain from or discontinue such advertising.
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<PAGE> 24
15. Tenant's contractors shall, while in the Building or elsewhere in
the Park, be subject to and under the control and direction of the
Superintendent of the Building (but not as agent or servant of said
Superintendent or of Landlord).
16. If Demised Premises is or becomes infested with vermin as a result
of the use or any misuse or neglect of Demised Premises by Tenant, its agents,
servants, employees, contractors, visitors, or licensees, Tenant shall forthwith
at Tenant's expense cause the same to be exterminated from time to time to the
satisfaction of Landlord and shall employ such licensed exterminators as shall
be approved in writing in advance by Landlord,
17. The requirements of Tenant shall be attended to only upon
application at the office of the Building. Building personnel shall not perform
any work or do anything outside of their regular duties, unless under special
instructions from the office of the Landlord.
18. Canvassing, soliciting, and peddling in the Building or in the Park
are prohibited and Tenant shall cooperate to prevent the same.
19. No water cooler, air conditioning unit or system, or other apparatus
shall be installed or used by Tenant without the written consent of Landlord.
20. Tenant, Tenant's agents, servants, employees, contractors,
licensees, or visitors shall not park any vehicles in any driveways, service
entrances, or areas posted "No Parking."
21. Tenant shall install and maintain, at Tenant's sole cost and
expense, an adequate visibly marked (at all times properly operational) fire
extinguisher next to any duplicating or photocopying machine or similar heat
producing equipment, which may or many not contain combustible material, in
Demised Premises.
22. Tenant shall not use the name of the Building for any purpose other
than as the address of the business to be conducted by Tenant in Demised
Premises, nor shall Tenant use any picture of the Building in its advertising,
stationery, or in any other manner without the prior written permission of
Landlord. Landlord expressly reserves the right at any time to change said name
without in any manner being liable to Tenant therefor.
21
<PAGE> 25
RIDER NO. 1
RENT WAIVER AGREEMENT
Reference is made to that certain Lease, dated March 31, 19889 by and between
THE IRVINE COMPANY, a Michigan corporation, as Landlord and KoFAX IMAGE
PRODUCTS, INC., a California corporation, as Tenant for 3 Jenner Street, Suite
100, Irvine, California,
Notwithstanding the Rent provision of the Lease, Landlord waives the Monthly
Rent for 15,544 square feet of the designated Premises in Exhibit A for a period
of four (4) consecutive months beginning thirty (30) days after the Lease
Commencement Date. However, Additional Rent, including but not limited to any
amortized tenant improvement costs, Tenant's prorata share of Operating
Expenses, and Real Property Taxes, will not be abated.
Notwithstanding the Rent provision of-the Lease, Landlord waives the Monthly
Rent and the Tenant's prorata share of Operating Expenses, and Real Property
Taxes for 4,091 square feet of the designated Premises in Exhibit A for a period
of twelve (12) consecutive months beginning on the Lease Commencement Date.
However, Additional Rent, including but not limited to any amortized Tenant
improvement costs, will not be abated.
Provided, however, that the Monthly Rent payable during the period set forth
above ("Rent Waiver Period") shall be payable if any event of default under the
Lease occurs at any time during the Term of the Lease, in which event on the
occurrence of such event of default, all such Monthly Rent for the Rent Waiver
Period shall become immediately due and payable by Tenant to Landlord, unless
such default is cured.
Tenant and Landlord agree that all terms and conditions of the above-referenced
Lease shall be in full force and effect (except the obligation to pay Monthly
Rent) during the Term of the Lease,
22
<PAGE> 26
RIDER NO. 2
PROSPECTIVE RECIPROCAL EASEMENT, ACCESS, AND MAINTENANCE AGREEMENT
This Rider is hereby attached to and made a part of the Lease dated:
March 31, by and between THE IRVINE COMPANY, a Michigan corporation, as Landlord
and KoFAX IMAGE PRODUCTS, INC., a California corporation, as Tenant for the
Premises known as 3 Jenner Street, Suite 100, Irvine, California.
Tenant understands that the Building in which the Premises are located is a part
of the multi-building Project ("Project") which covers the area shown on Exhibit
B attached to this Lease and which has not yet been fully developed, It is
anticipated that a Reciprocal Easement, Access, and Maintenance Agreement or
like instrument ("REA") may be recorded against all of the Project or a portion
of the Project which includes the Building In which the Premises are located for
the mutual benefit of all owners of property within the Project encumbered by
the REA and their tenants, imposing certain restrictions, covenants, easements,
and obligations upon the Premises, Landlord, and Tenant in order to obtain such
benefit. Such REA may or may not be established in connection with a possible
subdivision of Lot 18 of the Project into three (3) separate legal parcels, The
REA will likely contain, without limitation, the following:
(1) reciprocal easements for vehicular and pedestrian access and
circulation over certain portions of the Project designed for reciprocal
access and circulation;
(2) covenants for the maintenance and repair (or reimbursement
for the costs thereof if done by an "Operator" designated in the REA) of
the exterior of all buildings, landscaping, and parking areas;
(3) assessment provisions for the reimbursement of costs
incurred by an "Operator" designated in the REA and who is authorized to
enforce the REA and/or perform certain maintenance and repair functions
specified therein. Such assessments will be allocated by either a
separate charge attributable directly to work or services provided for
the Premises, or on an in-common basis for the whole Project, in which
event Tenant shall only be responsible for Tenant's Percentage of such
assessment.
Tenant agrees to this Lease and Tenant's occupancy of the Premises hereunder
shall, upon the recordation of the REA in the Official Records of Orange County,
be subject to the REA and Tenant agrees to abide thereby. Landlord shall deliver
a copy of the REA to Tenant concurrently with or promptly following its
recordation. To the extent the obligations imposed by, or services provided by
the Operator under, the REA are the same obligations imposed upon Landlord under
the Lease, they shall be performed by Landlord or the Operator under the REA and
the cost thereof shall be paid by Tenant to the Operator as provided in the REA
or to Landlord as Additional Rent in accordance with the provisions of Paragraph
5(c) of the Lease; to the extent such obligations are the same obligations
imposed upon Tenant under the Lease, such obligations shall be performed by
Tenant at Tenant's cost.
23
<PAGE> 27
RIDER NO. 3
PARKING
This Rider is hereby attached to and made a part of the Lease dated: March 31,
1988, by and between THE IRVINE COMPANY, a Michigan corporation, as Landlord and
KoFAX IMAGE PRODUCTS, INC., a California corporation, as Tenant for the Premises
known as 3 Jenner Street, Suite 100, Irvine, California.
During the Term of this Lease, Tenant shall have the right to use four (4)
parking spaces per 1,000 square feet of the "Premises". Such parking rights
shall be subject to the provisions of Paragraph 40 of the Lease, shall be at no
additional charge to Tenant (subject to Tenant's obligations under Paragraph 16
of the Lease), and shall be on a non-exclusive basis in common with other
tenants of the Project.
24
<PAGE> 28
RIDER NO. 4
SIGNAGE
This Rider is hereby attached to and made a part of the Lease dated: March 31,
1988, by and between THE IRVINE COMPANY, a Michigan corporation, as Landlord and
KoFAX IMAGE PRODUCTS, INC., a California corporation, as Tenant for the Premises
known as 3 Jenner Street, Suite 100, Irvine, California,
Landlord grants Tenant, subject to Landlord's Signage Program developed for the
Project, the exclusive right, at Tenant's sole cost and expense to erect one (1)
"Major Tenant Identification Sign" setting forth its trademark or the name under
which it conducts business; provided that Tenant shall submit to Landlord for
its approval, which approval shall not be unreasonably withheld, conditioned or
delayed, detailed plans and specifications for the sign Tenant proposes to erect
showing the size, exact location, color and materials of such sign. The cost of
planning, engineering, construction, maintenance and removal of any such sign
shall be the sole and exclusive obligation of Tenant. In the construction and
maintenance of such sign, Tenant shall comply with all applicable governmental
laws, rules, regulations, ordinances, orders and requirements and any private
covenants, conditions and restrictions affecting the Building or the Demised
Premises of which Landlord has provided notice to Tenant. The sign rights herein
granted to Tenant are personal and may not be assigned, sublet, transferred,
conveyed or otherwise alienated in any fashion, without Landlord's prior written
consent, which consent shall not be unreasonably withheld, conditioned or
delayed. Upon expiration or earlier termination of this Lease or any assignment
or subletting by Tenant of all or substantially all of the Premises, Tenant at
its sole cost and expense shall remove any such sign and repair any damage to
the Building caused by such removal,
25
<PAGE> 29
RIDER NO. 5
Phased Use of Premises
This Rider is hereby attached to and made a part of the Lease dated:
March 31, 1988 by and between THE IRVINE COMPANY, a Michigan corporation, as
Landlord and KoFAX IMAGE PRODUCTS, INC., a California corporation, as Tenant for
the Premises known as 3 Jenner Street, Suite 100, Irvine, California
Notwithstanding any other provision contained in the Lease, Tenant shall
take possession of the Premises in two (2) phases, the first phase ("Phase I
Premises") to consist of 15,544 square feet of the Premises as shown on Exhibit
"A" to the Lease, with possession to commence in accordance with Paragraph 4 of
the Lease, and the second phase ("Phase II Premises") to consist of the
remaining 4,091 square feet of the Premises. Tenant anticipates taking
possession of the Phase II Premises on or about July 1, 1989, however, the
Tenant's Lease payment obligations with respect to the Phase II Premises shall
commence ("Phase II Commencement") upon the earlier of (i) the date Tenant
commences occupancy of the Phase II Premises (if Tenant takes occupancy prior to
July 1, 1989), or (ii) the date upon which the Tenant Improvements for the Phase
II Premises are completed, as evidenced by the first to occur of City approval
of said Tenant Improvements or the certification of substantial completion of
the Tenant improvements by Landlord's architect supervising construction of said
Tenant Improvements (if later than July 1, 1989). Notwithstanding the third
paragraph of the Rent Waiver Agreement set forth in Rider No. 1 of the Lease,
Tenant shall begin paying Monthly Rent and Tenant's pro rata share of Operating
Expenses and Real Property Taxes for the Phase II Premises upon the Phase II
Commencement.
Tenant's phased use of the Premises shall in no event (a) extend the
Term of the Lease beyond what is set forth in Paragraph 4(a) of the Lease, or
(b) limit or diminish any of the Tenant's other duties, obligations or
responsibilities under the Lease except as specifically set forth in this Rider
No. 5.
26
<PAGE> 30
Schedule III
Quality of Construction Material Letter
(The following is intended as an example only)
REFERENCE: Building(s) 2,3,4 & 5 Jenner and 8 & 10 Pasteur Industrial
DESCRIPTION OF ITEMS
The following listed items represent the quality of materials to be provided in
the Preliminary Cost Estimate provided by Landlord for the Tenant Improvements.
The Preliminary Cost Estimate will also include an allowance for building permit
and space planning costs.
1. DEMISING PARTITION
3-5/8", 25 gauge steel studs at 24" O.C. with 5/8" type "x"
gypsum board each side. Installed from slab to structure above,
R-11 batt installation in wall cavity.
2. INTERIOR PARTITION
2-1/2" 25 gauge steel studs at 24" O.C. with 5/8" type "x"
gypsum board each side installed from slab to underside of
ceiling grid with seismic bracing per City of Irvine Building
Code.
3. DOORS AND FRAMES
Solid core doors 3' - 0" x 8' - 0" high, Mendocino Oak.
4. ACOUSTICAL CEILING
2' x 4' white enameled steel grid, 800 series by Chicago
Metallic.
5. LIGHT FIXTURES
2' x 4' recessed fluorescent light fixture with 3 lamps, energy
saving ballast, and acrylic prismatic lens. Lithonia #GT 440 RW
A-12 277ES.
6. LIGHT SWITCHES
Two (2) gang switches with white plastic cover plate.
7. DUPLEX OUTLETS
120 volt - 15 amp receptacle with white cover plate.
8. TELEPHONE OUTLET
Standard mudring with standard cover plate with conduit to 6"
above ceiling.
9. EXIT SIGN
Exit signs as required by City.
<PAGE> 31
10. HEATING VENTILATION & AIR CONDITIONING
Water source heat pump system. Distribution through 2 x 2 louver
face adjustable grill supply and perforated face diffusers.
11. FIRE EXTINGUISHER
Sampson model 99 fire cabinet with 2A 10BC minimum rated fire
extinguisher or equal.
12. SPRINKLER HEADS
Semi-recessed chrome heads in improved office area of buildings
1 & 2. Standard heads all other areas.
13. FLOORCOVERING
Office: 30 oz. cut pile carpet. Installed over 5/16" Nova
cushion pad, carpet shall be by Designweave, Pattern: Danapoint,
or vinyl composition tile throughout improved office area.
14. BASE
2" rubber base by Roppe, color per building standard.
15. PAINT
Standard paint Frazee "Vinyl-Lux" latex paint with Eggshell
finish or equivalent. One coat to cover all walls.
16. WINDOW COVERINGS
White miniblinds.
<PAGE> 32
1st AMENDMENT TO LEASE
I. PARTIES AND DATE.
This First Amendment to Lease (this "Amendment") dated as of March 7, 1990,
is entered into by and between The Irvine Company, a Michigan Corporation
("Landlord"), and Kofax Image Products, ("Tenant").
II. RECITALS.
Landlord and Tenant entered into [are successors in interest to) that
certain Standard Form Lease [between The Irvine Company and Kofax Image
Products] dated as of March 31, 1988, as amended by amendments dated
_________________ (as amended, the "Lease"), concerning certain premises
("Premises") located at 3 Jenner Street, Suite 100, Irvine, California.
Landlord and Tenant desire to modify the Lease as set forth in this
Amendment, which modifications shall be deemed effective as of the date of this
Amendment as indicated above.
III. MODIFICATIONS.
Landlord and Tenant hereby agree that the Lease shall be modified and/or
supplemented as follows:
A. Rent Adjustments. Exhibit "E" to the Lease is hereby deleted and
replaced in full by the Exhibit "E" which is attached hereto as
Exhibit "A" to this Amendment and incorporated herein by this
reference.
IV. GENERAL.
A. Effect of Amendments. Except to the extent the Lease is modified by
this Amendment, the remaining terms and provisions of the Lease shall remain
unmodified and in full force and effect. In the event of conflict between the
terms of the Lease and the terms of this Amendment, the terms of this Amendment
shall prevail.
B. Entire Agreement. This Amendment embodies the entire understanding
between Landlord and Tenant with respect to its subject matter and can be
changed only by an instrument in writing signed by Landlord and Tenant.
C. Counterparts. If this Amendment is executed in counterparts, each
counterpart shall be deemed an original.
Initials _____
<PAGE> 33
D. Defined Terms. All capitalized terms used and not otherwise defined in
this Amendment, but defined in the Lease, shall have the same meaning in this
Amendment as in the Lease.
E. Corporate and Partnership Authority. If Tenant is a corporation or
partnership, or is comprised of either or both of them, each individual
executing this Amendment for the corporation or partnership represents that he
or she is duly authorized to execute and deliver this Amendment for the
corporation or partnership and that this Amendment is binding upon the
corporation or partnership in accordance with its terms.
F. Attorneys' Fees. The provisions of the Lease respecting payment of
attorney's fees shall also apply to this Amendment.
"Landlord"
The Irvine Company
a Michigan Corporation
By: /s/ ROBERT E. WILLIAMS, JR.
------------------------------------------
Robert E. Williams, Jr.
Its: Senior Director
------------------------------------------
By: /s/ RICHARD A. JONES
------------------------------------------
Richard A. Jones
Its: Assistant Secretary
------------------------------------------
"Tenant"
Kofax Image Products Inc.
a California Corporation
By: /s/ DAVID SILVER
------------------------------------------
David Silver
Its: President
------------------------------------------
By: /s/ DEAN A. HOUGH
------------------------------------------
Dean A. Hough
Its: Secretary
------------------------------------------
Initials _____
<PAGE> 34
EXHIBIT A
RENT ADJUSTMENTS
This Exhibit is hereby attached to and made a part of the Lease dated: March 31,
1988, by and between THE IRVINE COMPANY, a Michigan corporation, as Landlord and
KOFAX IMAGE PRODUCTS, INC., a California corporation, as Tenant for the Premises
known as 3 Jenner Street, Suite 100, Irvine, California.
<CAPTION>
BASE RENT MONTHLY RENTAL RATE
--------- -------------------
09/16/88 - 10/15/88 $16,174.00
10/16/88 - 02/15/89 0
02/16/89 - 09/15/89 $16,174.00
09/16/89 - 09/30/89 $18,302.50
10/01/89 - 03/31/90 $20,431.00
04/01/90 - 08/31/90 $25,950.27
09/01/90 - 09/30/90 $26,735.77
10/01/90 - 10/31/91 $27,521.27
11/01/91 - 11/15/91 $11,001.00
(See Rider No. 1 of Lease dated March 31, 1988)
<PAGE> 35
SECOND AMENDMENT TO LEASE
I. PARTIES AND DATE.
This Second Amendment to Lease (this "Amendment") dated as of May 4, 1990,
is entered into by and between THE IRVINE COMPANY, A Michigan Corporation,
("Landlord"), and KOFAX IMAGE PRODUCTS, a California Corporation ("Tenant").
II. RECITALS.
Landlord and Tenant entered into that certain Standard Form Lease dated as
of March 31,1988, as amended by an amendment dated March 7, 1990 (as amended,
the "Lease"), concerning certain premises ("Premises") located at 3 Jenner
Street, Suite 150, Irvine, California.
Landlord and Tenant now desire to expand the "Premises" to include the
additional 5,735 gross square feet of space, more particularly shown on Exhibit
"A" attached hereto and incorporated herein by reference ("Additional Space").
III. MODIFICATIONS,
Landlord and Tenant hereby agree that the Lease shall be modified and / or
supplemented as follows:
A. Expanded Premises. Landlord hereby leases the Additional Space to
Tenant, and Tenant hereby leases the Additional Space from Landlord, on the
terms and conditions herein provided. From and after the date hereof, the
"Premises" under the Lease shall consist of the Premises described on Exhibit
"A" to the Lease together with the Additional Space described on Exhibit "A" to
this Amendment.
B. ADDITIONAL SPACE IMPROVEMENTS. Landlord shall construct, at its expense,
the following improvements to the Additional Space: Refer to the attached
Exhibit "B".
<PAGE> 36
C. ADDITIONAL RENT. Commencing on the earlier of: (i) July 1, 1990, or (ii)
the date Tenant commences occupancy of the Additional Space (the "Additional
Space Commencement Date"), Tenant shall pay to Landlord Monthly Rent (in
addition to the Monthly Rent payable as now provided in the Lease) for the
Additional Premises, in advance on the first day of the month, as follows:
<CAPTION>
SCHEDULE MONTHLY RENT
-------- ------------
July and August, 1990 $5,964.40
September, 1990 $6,423.20
October, 1990 through
October, 1991 $6,423.20
November, 1991 through
November 15, 1991 $3,211.60
If the Additional Space Commencement Date is not the first (1st) day of the
month, a prorated installment of Monthly Rental for the Additional Space based
on a thirty (30) day month shall be paid for the fractional month during which
Additional Space Commencement Date occurs.
D. REVISED TENANT'S PERCENTAGE. Commencing on the Additional Space
Commencement Date, the "Tenant's Percentage" (as set forth in Paragraph Q of the
Lease Summary) for purposes of calculating Tenant's prorata obligation for
Operating Expenses, shall be revised to 17.46%.
IV. GENERAL.
A. Effect of Amendments. Except to the extent the Lease is modified by this
Amendment, the remaining terms and provisions of the Lease shall remain
unmodified and in full force and effect. In the event of conflict between the
terms of the Lease and the terms of this Amendment, the terms of this Amendment
shall prevail.
B. Entire Agreement. This Amendment embodies the entire understanding
between Landlord and Tenant with respect to its subject matter and can be
changed only by an instrument in writing signed by Landlord and Tenant.
<PAGE> 37
C. Counterparts. If this Amendment is executed in counterparts, each
counterpart shall be deemed an original.
D. Defined Terms. All capitalized terms used and not otherwise defined in
this Amendment, but defined in the Lease, shall have the same meaning in this
Amendment as in the Lease.
E. Corporate and Partnership Authority. If Tenant is a corporation or a
partnership, or is comprised of either or both of them, each individual
executing this Amendment for the corporation or partnership represents that he
or she is duly authorized to execute and deliver this Amendment for the
corporation or partnership and that this Amendment is binding upon the
corporation or partnership in accordance with its terms.
F. Attorney's Fees. The provisions of the Lease respecting payment of
attorney's fees shall also apply to this Amendment.
"Landlord"
THE IRVINE COMPANY
a Michigan Corporation
By: /s/ ROBERT E. WILLIAMS, JR.
------------------------------------------
Robert E. Williams, Jr.
Senior Director
By: /s/ RICHARD A. JONES
------------------------------------------
Richard A. Jones
Assistant Secretary
"Tenant"
KOFAX IMAGE PRODUCTS
a California Corporation
By: /s/ DAVID SILVER
------------------------------------------
David Silver
President
By: /s/ DEAN A. HOUGH
------------------------------------------
Dean A. Hough
Secretary
<PAGE> 38
EXHIBIT A
Suite 1500
<PAGE> 39
Exhibit B
WORK LETTER
(Tenant Improvement Allowance)
Industrial
In connection with the Lease (the "Lease") to which this Exhibit B (this
"Work Letter") is attached, and in consideration of the mutual covenants
contained in the Lease and in this Work Letter, Landlord and Tenant agree as
follows:
1. APPLICATION OF EXHIBIT
Capitalized terms used and not otherwise defined herein shall have the same
definitions as set forth in the Lease. The provisions of this Work Letter shall
apply to the planning and completion of leasehold improvements requested by
Tenant (the "Tenant Improvements") for the fitting out of the Initial Premises,
as more fully set forth herein.
2. LANDLORD AND TENANT PRE-CONSTRUCTION OBLIGATIONS
(a) PRELIMINARY PLANS. Attached to this Work Letter as Schedule I are
preliminary space plans for the Tenant Improvements (the "Preliminary Plans"),
which include, without limitation, sketches and/or drawings showing locations of
doors, partitioning, electrical fixtures, outlets and switches, plumbing
fixtures, floor loads and other requirements. Tenant acknowledges that the
Preliminary Plans have been prepared by Landlord's Architect after consultation
and cooperation between Tenant and Landlord's Architect regarding the proposed
Tenant Improvements and preparation of the Preliminary Plans for same. Landlord
and Landlord's Architect shall be entitled, in all respects, to rely upon all
information supplied by Tenant regarding the Tenant Improvements, and in all
cases the Preliminary Plans (i) shall be subject to Landlord's final approval,
which approval shall not be unreasonably withheld, (ii) shall not be in conflict
with building codes for the City of Irvine or with insurance regulations for a
fire resistive Class A building, and (iii) shall be in a form satisfactory to
appropriate governmental authorities responsible for issuing permits and
licenses required for construction. The costs associated with preparation of the
Preliminary Plans shall be borne by Tenant and paid as set forth in Section 5
and Section 6 of this Work Letter.
(b) PRELIMINARY PRICE ESTIMATE. Attached to this Work Letter as Schedule II
is an estimated breakdown of the construction costs for the Tenant Improvement
Costs (as hereinafter defined) based on the Preliminary Plans (the "Preliminary
Price Estimate"), including the cost of the Preliminary Plans and Working
Drawings and any and all fees, prepared by Landlord in conjunction with the
Contractor (as hereinafter defined). The Preliminary price estimate will be
updated and revised as necessary.
(c) APPROVAL OF PRELIMINARY PLANS AND PRELIMINARY PRICE ESTIMATE. Tenant
acknowledges that Tenant's execution of the Lease shall be conclusive evidence
that Tenant has reviewed and approved the Preliminary Plans and the Preliminary
Price Estimate.
(d) WORKING DRAWINGS. Within fourteen (14) days following full execution of
this Lease by both Landlord and Tenant, Landlord's Architect shall prepare
working drawings (the "Working Drawings") for the Tenant Improvements based upon
the approved Preliminary Plans. The Working Drawings shall include
architectural, mechanical and electrical construction drawings for the Tenant
Improvements based on the Preliminary Plans. The costs associated with
preparation of the Working Drawings shall be borne by Tenant and paid as set
forth in Section 5 and Section 6 of this Work Letter.
(e) APPROVAL OF WORKING DRAWINGS. Landlord or Landlord's Architect shall
submit the Working Drawings to Tenant for Tenant's review, and Tenant shall
notify Landlord and Landlord's Architect within five (5) days after delivery
thereof of any requested revisions. Within five (5) days after receipt of
Tenant's notice, Landlord's Architect shall make all approved revisions to the
Working Drawings and submit two (2) copies thereof to Tenant for its final
review and approval, which approval shall be given within three (3) days
thereafter. Concurrently with the above review and approval process, Landlord
may submit all plans and specifications to City and other applicable
governmental agencies in an attempt to expedite City approval and issuance of
all necessary permits and licenses to construct the Tenant Improvements as shown
on the Working Drawings. Any changes which are required by City or other
governmental entity shall be immediately submitted to Landlord for Landlord's
review and reasonable approval, and Landlord shall promptly notify Tenant of
such changes.
(f) SCHEDULE OF CRITICAL DATES. Set forth below is a schedule of certain
critical dates relating to Landlord's and Tenant's respective obligations with
respect to the design and construction of Tenant's Improvements for the
Premises. Such dates and the respective obligations of Landlord and Tenant are
more fully described elsewhere in this Work Letter. The purpose of the following
schedule is to provide a reference for Landlord and Tenant and to make certain
the Final Approval Date occurs as set forth herein. Following the Final Approval
Date, Tenant shall be deemed to have released Landlord to commence construction
of the Tenant Improvements as set forth in Section 4 below.
<CAPTION>
REFERENCE DATE DUE RESPONSIBLE PARTY
--------- -------- -----------------
A. "Preliminary Plan Approval" The date of execution of Lease Tenant and
Landlord
B. "Preliminary Price The date of execution of Lease Tenant
Estimate Approval"
C. "Working Drawings Completion" Fourteen (14) days after full Landlord
execution of Lease
D. "Working Drawings Review" Five (5) days after Landlord submits
the Working Drawings to Tenant Tenant
E. "Working Drawings Revision" Five (5) days after Tenant returns
the Working Drawings to Landlord Landlord
F. "Final Approval Date" Three (3) days attar Landlord submits
the revised Working Drawings to Tenant Tenant
3. BUILDING PERMIT
After the Final Approval Date has occurred, Landlord shall, if Landlord has
not already done so, submit the Working Drawings to the appropriate governmental
body or bodies for final plan checking and a building permit. Landlord, with
Tenant's cooperation, shall cause to be made any change in the Working Drawings
necessary to obtain the building permit; provided, however, after the Final
Approval Date, no changes shall be made to the Working Drawings without the
prior written approval of both Landlord and Tenant, and then only after
agreement by Tenant to pay any excess costs resulting from such changes.
4. CONSTRUCTION OF TENANT IMPROVEMENTS
After the Final Approval Date has occurred and a building permit for the
work has been issued, Landlord shall, through a guaranteed maximum cost
construction contract ("Construction Contract") with a reputable, licensed
contractor selected by Landlord ("Contractor"), cause the construction of the
Tenant Improvements to be carried out in substantial conformance with the
Working Drawings in a good
C-1
<PAGE> 40
and workmanlike manner using first-class materials. The costs associated with
the construction of the Tenant Improvements shall be paid as set forth in
Section 5 and Section 6 of this Work Letter. Landlord shall see that the
construction complies with all applicable building, fire, health and sanitary
codes and regulations, the satisfaction of which shall be evidenced by a
certificate of occupancy for the Promises.
5. TENANT IMPROVEMENT ALLOWANCE
(a) TENANT IMPROVEMENTS. Landlord shall provide Tenant with a Tenant
Improvement Allowance in the amount of $100,799 $17.58 S/F towards the cost of
the design, purchase and construction of the Tenant Improvements, including
without limitation design, engineering and consulting fees (collectively, the
"Tenant Improvement Costs"). The Tenant Improvement Allowance shall be used for
payment of the following Tenant Improvement Costs:
(i) Preparation by Landlord's Architect of the Preliminary Plans and
the Working Drawings as provided in Section 2 of this Work Letter,
including without limitation all fees charged by City (including without
limitation fees for building permits and plan checks) in connection with
the Tenant Improvements work in the Premises;
(ii) Construction work for completion of the Tenant Improvements as
reflected in the Construction Contract, including without limitation the
costs for materials listed in the Quality of Construction Material Letter
attached to this Work Letter as Schedule III;
(iii) all contractors' charges, general conditions and construction
fees; and
(iv) an additional fifteen percent (15.0%) of the total of all costs
to defray Landlord's overhead and indirect costs with respect to the Tenant
Improvements.
6. COSTS IN EXCESS OF TENANT IMPROVEMENT ALLOWANCE AT TENANT'S EXPENSE
(a) COST APPROVAL. Tenant shall pay the excess of the Tenant Improvement
Costs over the amount of the Tenant Improvement Allowance available to defray
such costs. Concurrent with the plan checking referred to in Section 3 of this
Work Letter, Landlord shall prepare and submit to Tenant a written estimate of
the amount of the remaining Tenant Improvement Costs and the cost of the Tenant
Improvement Allowance still available to defray such costs (after preparation of
the Preliminary Plans and Working Drawings). Tenant shall approve or disapprove
any such estimate by written notice to Landlord within three (3) days after
receipt thereof. If Tenant fails to notify Landlord of its disapproval within
such three (3) day period, Tenant shall be deemed to have approved such
estimate. If such estimate exceeds the Tenant Improvement Allowance then still
available and Tenant approves such estimate, Tenant's notice of approval shall
include payment to Landlord for the full amount of such excess. If Tenant
disapproves such estimate within the three (3) day period, Landlord shall not
proceed with the Tenant Improvements, but Landlord and Tenant shall thereafter
meet and cooperate to amend the Working Drawings for the Premises as necessary
to obtain Tenant's approval of the cost thereof, provided that Tenant shall pay
any costs resulting from such changes and Tenant shall be liable for the delay
in completing the Tenant Improvements and the increased costs, if any, resulting
from such delay.
(b) FINAL COSTS. Upon completion by Landlord of the Tenant Improvements,
Landlord shall determine the actual final Tenant Improvements Costs and shall
submit a written statement of such amount to Tenant. If any estimate previously
paid by Tenant exceeds the amount due hereunder from Tenant for such work, such
excess shall be refunded to Tenant. On the other hand, if any amount is still
due from Tenant for such work, then Tenant shall pay such amount in full
within ten (10) days of receipt of Landlord's statement.
7. CHANGE ORDERS
Tenant may from time to time request and obtain change orders during the
course of construction provided that (i) each such request shall be reasonable,
shall be in writing and signed by or on behalf of Tenant, and shall not result
in any structural change in the Building, as reasonably determined by Landlord,
(ii) all additional charges and costs, including without limitation
architectural and engineering costs, construction and materials costs, and
processing costs of any governmental entity shall be the sole and exclusive
obligation of Tenant, and (iii) any resulting delay in the completion of the
Tenant Improvements shall be deemed a Tenant Delay and in no event shall extend
the Commencement Date of this Lease. Upon Tenant's request for a change order,
Landlord shall as soon as reasonably possible submit to Tenant a written
estimate of the increased or decreased cost and anticipated delay, if any,
attributable to such requested change. Within three (3) days of the date such
estimated cost adjustment and delay are delivered to Tenant, Tenant shall advise
Landlord whether it wishes to proceed with the change order, and if Tenant
elects to proceed with the change order. Tenant shall remit, concurrently with
Tenant's notice to proceed, the amount of the increased cost, if any,
attributable to such change order. Unless Tenant includes in its initial change
order request that the work in process at the time such request is made be
halted pending approval and execution of a change order, Landlord shall not be
obligated to stop construction of the Tenant Improvements, whether or not the
change order relates to the work then in process or about to be started.
8. TENANT DELAYS
In no event shall the Commencement Date of the Lease be extended or delayed
due or attributable to delays due to the fault of Tenant ("Tenant Delays").
Tenant Delays shall include. but are not limited to, delays caused by or
resulting from any one or more of the following:
(a) Tenant's failure to timely review and reasonably approve the Working
Drawings or to furnish information to Landlord for the preparation by Landlord
of the Working Drawings;
(b) Tenant's request for or use of special materials, finishes or
installments which are not readily available, provided that Landlord shall
notify Tenant in writing that the particular material, finish, or installation
is not readily available promptly upon Landlord's discovery of same;
(c) Delays of any nature, whether or not within Tenant's control, resulting
from Tenant's decision to use any materials, finishes or installations other
than "building standard" materials, finishes or installations.
(d) Change orders requested by Tenant;
(e) interference by Tenant or by Tenant's agents, employees, contractors or
subcontractors with Landlord's construction activities;
(f) Tenant's failure to approve any other item or perform any other
obligation in accordance with and by the data specified herein or in the
Construction Contract;
(g) Tenant's requested changes in the Preliminary Plans, Working Drawings
or any other plans and specifications after the approval thereof by Tenant or
submission thereof by Tenant to Landlord;
(h) Tenant's failure to approve written estimates of costs in accordance
with this Work Letter; and
(i) Tenant's obtaining or failure to obtain any necessary governmental
approvals or permits for Tenant's intended use of the Premises.
If the Commencement Date of the Lease is delayed by any Tenant Delays, whether
or not within the control of Tenant, then the Commencement Date of the Lease and
the payment of Rent shall be accelerated by the number of days of such delay,
Landlord shall give Tenant written notice within a reasonable time of any
circumstance that Landlord believes constitutes a Tenant Delay.
C-2
<PAGE> 41
9. TRADE FIXTURES AND EQUIPMENT
Tenant acknowledges and agrees that Tenant is solely responsible for
obtaining, delivering and installing in the Premises all necessary and desired
furniture, trade fixtures, equipment and other similar items, and that Landlord
shall have no responsibility whatsoever with regard thereto. Tenant further
acknowledges and agrees that neither the Commencement Date of the Lease nor the
payment of Rent shall be delayed for any period of time whatsoever due to any
delay in the furnishing of the Premises with such items.
10. FAILURE OF TENANT To COMPLY
Any failure of Tenant to comply with any of the provisions contained in
this Work Letter within the times for compliance herein set forth shall be
deemed a default under the Lease. In addition to the remedies provided to
Landlord in this Work Letter upon the occurrence of such a default by Tenant,
Landlord shall have all remedies available at law or equity to a landlord
against a defaulting tenant pursuant to a written lease, including but not
limited to those set forth in the Lease.
C-3
<PAGE> 42
SCHEDULE I
[ARCHITECTURAL DRAWING]
<PAGE> 43
SCHEDULE II
IRVINE/SAMMIS VENTURE
CONSTRUCTION COST SUMMARY
KOFAX ADDITION
3 Jenner Street, Suite 150
<CAPTION>
Activity Company Name Amount
-------- ------------ ------
Insulation Sierra Insulation $ 367.00
Framing/Susp. Ceiling Orange Coast Drywall 6,710.00
Electrical Bayside Electric 6,069.00
Mechanical Select Heating & Air 5,435.00
Fire Sprinklers Advanced Fire Protect 2,060.00
Doors/Windows 3-D Door, Inc. 2,100.00
Floor Covering Brian Nickens Flooring 3,944.00
Glass Services Mission Viejo Glass 2,535.00
Painting Mike Shill Painting 969.00
Locksmith Kustom Lock & Safe 280.00
Fire Extinguishers Newport Fire Extinguisher 140.00
Plan Reproduction OCB Reprographics, Inc. 100.00
Architectural Fees Donald Mueller, A.I.A. 2,925.00
Permit & Plancheck City of Irvine 1,400.00
Contingency 525.00
Contractor's Fee @ 5% 1,778.00
General Conditions 2,955.00
TOTAL CONSTRUCTION COST $40,292.00
Page 1
<PAGE> 44
THE SAMMIS COMPANY
Construction Information Form DATE: 12/15/89
--------
TENANT: JOB NO.: 912009 PREPARED BY: LISA
SPEC SUITE 150 ------ --------
-----------------------------
APPROVED BY: LISA
--------
PROJECT NAME: SUITE NO.: BLDG 3, SUITE 150
IRVINE/SAMMIS VENTURE -----------------
<CAPTION>
-------------------------------------------------------------------------------------------------------------
CHANGE ORDERS TOTAL TOTAL
CONTRACT --------------- REVISED AMOUNT PERCENT
ITEM AMOUNT PRIOR CURRENT CONTRACT COMPLETE COMPLETE
No. TRADE ITEM DESCRIPTION (NO. 1) (NO. 2 THRU 8) AMOUNT TO DATE TO DATE
-------------------------------------------------------------------------------------------------------------
1 60501 Temporary 0 0.00%
-------------------------------------------------------------------------------------------------------------
2 52211 Site Grading 0 0.00%
-------------------------------------------------------------------------------------------------------------
3 61101 Concrete Work 650 650 650 100.00%
-------------------------------------------------------------------------------------------------------------
4 61105 Cement Work 0 0.00%
-------------------------------------------------------------------------------------------------------------
5 52051 Demolition 0 0.00%
-------------------------------------------------------------------------------------------------------------
6 62101 Masonry 0 0.00%
-------------------------------------------------------------------------------------------------------------
7 62213 Structural Steel 0 0.00%
-------------------------------------------------------------------------------------------------------------
8 62703 Ornamental Iron 0 0.00%
-------------------------------------------------------------------------------------------------------------
9 62211 Reinforced Steel 0 0.00%
-------------------------------------------------------------------------------------------------------------
10 66261 Drywall 12874 12874 12874 100.00%
-------------------------------------------------------------------------------------------------------------
11 66263 Drywall Ceiling 0 0.00%
-------------------------------------------------------------------------------------------------------------
12 63107 Rough Carpentry Hardware 0 0.00%
-------------------------------------------------------------------------------------------------------------
13 64101 Roof Structure 0 0.00%
-------------------------------------------------------------------------------------------------------------
14 62231 Sheet Metal 0 0.00%
-------------------------------------------------------------------------------------------------------------
15 64107 Roofing & Waterproofing 450 -124 326 200 61.35%
-------------------------------------------------------------------------------------------------------------
16 61323 Cellular Concrete 0 0.00%
-------------------------------------------------------------------------------------------------------------
17 64201 Insulation 0 0.00%
-------------------------------------------------------------------------------------------------------------
18 65501 Windows & Sliding Doors 0 0.00%
-------------------------------------------------------------------------------------------------------------
19 65101 Hollow Doors & Frames 0 0.00%
-------------------------------------------------------------------------------------------------------------
20 65971 Demising Walls 0 0.00%
-------------------------------------------------------------------------------------------------------------
<CAPTION>
-------------------------------------------------------------------------------------------------------------
PERCENT OF UNPAID TOTAL TOTAL
CONTRACT CONTRACT COMPLETE PAID ON NET DUE
ITEM PAID FOR RETENTION LESS PREVIOUS THIS
No. TRADE ITEM DESCRIPTION TO DATE TO DATE RETENTION APPLICATION APPLICATION
-------------------------------------------------------------------------------------------------------------
1 60501 Temporary 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
2 52211 Site Grading 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
3 61101 Concrete Work 100.00% 650 650 0
-------------------------------------------------------------------------------------------------------------
4 61105 Cement Work 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
5 52051 Demolition 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
6 62101 Masonry 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
7 62213 Structural Steel 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
8 62703 Ornamental Iron 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
9 62211 Reinforced Steel 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
10 66261 Drywall 100.00% 12874 12874 0
-------------------------------------------------------------------------------------------------------------
11 66263 Drywall Ceiling 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
12 63107 Rough Carpentry Hardware 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
13 64101 Roof Structure 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
14 62231 Sheet Metal 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
15 64107 Roofing & Waterproofing 0.00% 200 200
-------------------------------------------------------------------------------------------------------------
16 61323 Cellular Concrete 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
17 64201 Insulation 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
18 65501 Windows & Sliding Doors 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
19 65101 Hollow Doors & Frames 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
20 65971 Demising Walls 0.00% 0 0
-------------------------------------------------------------------------------------------------------------
Page 2
<PAGE> 45
-------------------------------------------------------------------------------
THE SAMMIS COMPANY
Construction Information Form DATE: 12/15/89
--------
TENANT: JOB NO.: 912009 PREPARED BY: LISA
SPEC SUITE 150 ------ ----
--------------
APPROVED BY: LISA
PROJECT NAME: SUITE NO.: BLDG 3, SUITE 150 ----
IRVINE/SAMMIS VENTURE -----------------
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
CHANGE ORDERS TOTAL TOTAL
CONTRACT ---------------- REVISED AMOUNT PERCENT
ITEM AMOUNT PRIOR CURRENT CONTRACT COMPLETE COMPLETE
NO TRADE ITEM DESCRIPTION (NO. 1) (NO. 2 THRU 8) AMOUNT TO DATE TO DATE
------------------------------------------------------------------------------------------------------------------------------------
21 67601 Partitions 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
22 67631 Marlite 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
23 65811 Glass & Glazing 370 370 370 100.00%
------------------------------------------------------------------------------------------------------------------------------------
24 63201 Finish Carpentry 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
25 63222 Millwork - Doors & Frames 1475 1475 1475 100.00%
------------------------------------------------------------------------------------------------------------------------------------
26 63228 Millwork - Wardrobes 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
27 63223 Millwork - Cabinets 1060 1060 1060 100.00%
------------------------------------------------------------------------------------------------------------------------------------
28 63224 Millwork - Formica 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
29 63225 Millwork - Paneling 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
30 63227 Millwork - Trim 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
31 63207 Finish Carpentry Hardware 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
32 66513 Acoustic Tile & Ceiling 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
33 67811 Shower Doors - Tab Enclosures 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
34 67815 Toilet Partitions 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
35 65361 Overhead Doors 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
36 68501 Passenger Elevators 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
37 69101 Plumbing 5443 5443 5100 93.70%
------------------------------------------------------------------------------------------------------------------------------------
38 52722 Sewer, Water & Storm Drains 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
39 69211 Electrical 17999 124 18123 18123 100.00%
------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
PERCENT OF UNPAID TOTAL TOTAL
CONTRACT CONTRACT COMPLETE PAID ON NET DUE
ITEM PAID FOR RETENTION LESS PREVIOUS THIS
NO TRADE ITEM DESCRIPTION TO DATE TO DATE RETENTION APPLICATION APPLICATION
------------------------------------------------------------------------------------------------------------------------------------
21 67601 Partitions 0.00% 0 0
------------------------------------------------------------------------------------------------------------------------------------
22 67631 Marlite 0.00% 0 0
------------------------------------------------------------------------------------------------------------------------------------
23 65811 Glass & Glazing 100.00% 370 370 0
------------------------------------------------------------------------------------------------------------------------------------
24 63201 Finish Carpentry 0.00% 0 0
------------------------------------------------------------------------------------------------------------------------------------
25 63222 Millwork - Doors & Frames 100.00% 1475 1475 0
------------------------------------------------------------------------------------------------------------------------------------
26 63228 Millwork - Wardrobes 0.00% 0 0
------------------------------------------------------------------------------------------------------------------------------------
27 63223 Millwork - Cabinets 100.00% 1060 1060 0
------------------------------------------------------------------------------------------------------------------------------------
28 63224 Millwork - Formica 0.00% 0 0
------------------------------------------------------------------------------------------------------------------------------------
29 63225 Millwork - Paneling 0.00% 0 0
------------------------------------------------------------------------------------------------------------------------------------
30 63227 Millwork - Trim 0.00% 0 0
------------------------------------------------------------------------------------------------------------------------------------
31 63207 Finish Carpentry Hardware 0.00% 0 0
------------------------------------------------------------------------------------------------------------------------------------
32 66513 Acoustic Tile & Ceiling 0.00% 0 0
------------------------------------------------------------------------------------------------------------------------------------
33 67811 Shower Doors - Tab Enclosures 0.00% 0 0
------------------------------------------------------------------------------------------------------------------------------------
34 67815 Toilet Partitions 0.00% 0 0
------------------------------------------------------------------------------------------------------------------------------------
35 65361 Overhead Doors 0.00% 0 0
------------------------------------------------------------------------------------------------------------------------------------
36 68501 Passenger Elevators 0.00% 0 0
------------------------------------------------------------------------------------------------------------------------------------
37 69101 Plumbing 93.70% 5100 5100 0
------------------------------------------------------------------------------------------------------------------------------------
38 52722 Sewer, Water & Storm Drains 0.00% 0 0
------------------------------------------------------------------------------------------------------------------------------------
39 69211 Electrical 100.00% 18123 18123 0
------------------------------------------------------------------------------------------------------------------------------------
Page 3
<PAGE> 46
-------------------------------------------------------------------------------
THE SAMMIS COMPANY
Construction Information Form DATE: 12/15/89
--------
TENANT: JOB NO.: 912009 PREPARED BY: LISA
SPEC SUITE 150 ------ ----
--------------
APPROVED BY: LISA
PROJECT NAME: SUITE NO.: BLDG 3, SUITE 150 ----
IRVINE/SAMMIS VENTURE -----------------
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
CHANGE ORDERS TOTAL TOTAL
CONTRACT ---------------- REVISED AMOUNT PERCENT
ITEM AMOUNT PRIOR CURRENT CONTRACT COMPLETE COMPLETE
NO TRADE ITEM DESCRIPTION (NO. 1) (NO. 2 THRU 8) AMOUNT TO DATE TO DATE
------------------------------------------------------------------------------------------------------------------------------------
40 69131 Fixture - Inventory 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
41 69175 Heating 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
42 69171 HVAC 9150 9150 9150 0.00%
------------------------------------------------------------------------------------------------------------------------------------
43 60591 Project ID & Signs 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
44 67801 Toilet & Bath Accessories 285 285 284 99.72%
------------------------------------------------------------------------------------------------------------------------------------
45 66952 Vinyl Wall Covering & Base 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
46 66901 Painting 507 507 507 100.00%
------------------------------------------------------------------------------------------------------------------------------------
47 66703 Floor Covering 4706 4706 4706 100.00%
------------------------------------------------------------------------------------------------------------------------------------
48 66701 Carpeting 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
49 66981 Drapes / Blinds 1275 1275 1275 0.00%
------------------------------------------------------------------------------------------------------------------------------------
50 65102 Locksmith 95 95 95 100.00%
------------------------------------------------------------------------------------------------------------------------------------
51 66311 Ceramic Tile 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
52 69911 Common Area 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
53 52503 Striping & Bumpers 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
54 52481 Landscaping & Irrigation 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
55 67511 Fire Sprinklers 3125 3125 3124 99.98%
------------------------------------------------------------------------------------------------------------------------------------
56 67521 Fire Extinguishers 160 160 135 84.43%
------------------------------------------------------------------------------------------------------------------------------------
57 SUBTOTAL 59624 0 0 59624 59129 99.17%
------------------------------------------------------------------------------------------------------------------------------------
58 60879 Miscellaneous 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
59 SUBTOTAL 59624 0 0 59624 59129 99.17%
------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------------
PERCENT OF UNPAID TOTAL TOTAL
CONTRACT CONTRACT COMPLETE PAID ON NET DUE
ITEM PAID FOR RETENTION LESS PREVIOUS THIS
NO TRADE ITEM DESCRIPTION TO DATE TO DATE RETENTION APPLICATION APPLICATION
-----------------------------------------------------------------------------------------------------------------------------------
40 69131 Fixture - Inventory 0.00% 0 0
-----------------------------------------------------------------------------------------------------------------------------------
41 69175 Heating 0.00% 0 0
-----------------------------------------------------------------------------------------------------------------------------------
42 69171 HVAC 100.00% 9150 9150 0
-----------------------------------------------------------------------------------------------------------------------------------
43 60591 Project ID & Signs 0.00% 0 0
-----------------------------------------------------------------------------------------------------------------------------------
44 67801 Toilet & Bath Accessories 99.65% 284 284 0
-----------------------------------------------------------------------------------------------------------------------------------
45 66952 Vinyl Wall Covering & Base 0.00% 0 0
-----------------------------------------------------------------------------------------------------------------------------------
46 66901 Painting 100.00% 507 507 0
-----------------------------------------------------------------------------------------------------------------------------------
47 66703 Floor Covering 100.00% 4706 4706 0
-----------------------------------------------------------------------------------------------------------------------------------
48 66701 Carpeting 0.00% 0 0
-----------------------------------------------------------------------------------------------------------------------------------
49 66981 Drapes / Blinds 100.00% 1275 1275 0
-----------------------------------------------------------------------------------------------------------------------------------
50 65102 Locksmith 100.00% 95 95 0
-----------------------------------------------------------------------------------------------------------------------------------
51 66311 Ceramic Tile 0.00% 0 0
-----------------------------------------------------------------------------------------------------------------------------------
52 69911 Common Area 0.00% 0 0
-----------------------------------------------------------------------------------------------------------------------------------
53 52503 Striping & Bumpers 0.00% 0 0
-----------------------------------------------------------------------------------------------------------------------------------
54 52481 Landscaping & Irrigation 0.00% 0 0
-----------------------------------------------------------------------------------------------------------------------------------
55 67511 Fire Sprinklers 99.98% 3124 3124 0
-----------------------------------------------------------------------------------------------------------------------------------
56 67521 Fire Extinguishers 84.38% 135 135 0
-----------------------------------------------------------------------------------------------------------------------------------
57 SUBTOTAL 98.83% 0 59129 58928 200
-----------------------------------------------------------------------------------------------------------------------------------
58 60879 Miscellaneous 0.00% 0 0
-----------------------------------------------------------------------------------------------------------------------------------
59 SUBTOTAL 98.83% 0 59129 58928 200
-----------------------------------------------------------------------------------------------------------------------------------
Page 4
<PAGE> 47
-------------------------------------------------------------------------------
THE SAMMIS COMPANY
Construction Information Form DATE: 12/15/89
--------
TENANT: JOB NO.: 912009 PREPARED BY: LISA
SPEC SUITE 150 ------ ----
--------------
APPROVED BY: LISA
PROJECT NAME: SUITE NO.: BLDG 3, SUITE 150 ----
IRVINE/SAMMIS VENTURE -----------------
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
CHANGE ORDERS TOTAL TOTAL
CONTRACT ---------------- REVISED AMOUNT PERCENT
ITEM AMOUNT PRIOR CURRENT CONTRACT COMPLETE COMPLETE
NO TRADE ITEM DESCRIPTION (NO. 1) (NO. 2 THRU 8) AMOUNT TO DATE TO DATE
------------------------------------------------------------------------------------------------------------------------------------
60 60781 Architectural Engineering 888 888 887 99.89%
------------------------------------------------------------------------------------------------------------------------------------
61 60021 Build Permit & Plan Check 466 466 446 99.93%
------------------------------------------------------------------------------------------------------------------------------------
62 60831 Electrical Engineering 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
63 60091 Plan & Spec (blueprints) 50 50 47 93.24%
------------------------------------------------------------------------------------------------------------------------------------
64 60833 Mechanical Engineering 0 0.00%
------------------------------------------------------------------------------------------------------------------------------------
65 SUBTOTAL 61028 0 0 61028 60528 99.18%
------------------------------------------------------------------------------------------------------------------------------------
66 60971 CONTINGENCY 500 213 713 100.00%
------------------------------------------------------------------------------------------------------------------------------------
67 SUBTOTAL 61528 213 0 61741 61241 99.19%
------------------------------------------------------------------------------------------------------------------------------------
68 60981 CONTRACTORS FEES @ 5% 3076 11 0 3087 3062 99.19%
------------------------------------------------------------------------------------------------------------------------------------
69 SUBTOTAL 64604 224 0 64828 64303 99.19%
------------------------------------------------------------------------------------------------------------------------------------
70 60991 GENERAL CONDITIONS 300 -213 87 153 175.86%
------------------------------------------------------------------------------------------------------------------------------------
71 60103 Cleanup 450 450 325 72.22%
------------------------------------------------------------------------------------------------------------------------------------
72 60191 Project Supervision 1500 1500 1488 99.18%
------------------------------------------------------------------------------------------------------------------------------------
73 60321 Insurance & Benefits 256 256 254 99.18%
------------------------------------------------------------------------------------------------------------------------------------
74 TOTAL CONSTRUCTION COSTS 67110 11 0 67121 66523 99.11%
------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
PERCENT OF UNPAID TOTAL TOTAL
CONTRACT CONTRACT COMPLETE PAID ON NET DUE
ITEM PAID FOR RETENTION LESS PREVIOUS THIS
NO TRADE ITEM DESCRIPTION TO DATE TO DATE RETENTION APPLICATION APPLICATION
----------------------------------------------------------------------------------------------------------------------------------
60 60781 Architectural Engineering 99.89% 887 887 0
----------------------------------------------------------------------------------------------------------------------------------
61 60021 Build Permit & Plan Check 100.00% 466 466 0
----------------------------------------------------------------------------------------------------------------------------------
62 60831 Electrical Engineering 0.00% 0 0
----------------------------------------------------------------------------------------------------------------------------------
63 60091 Plan & Spec (blueprints) 94.00% 47 47 0
----------------------------------------------------------------------------------------------------------------------------------
64 60833 Mechanical Engineering 0.00% 0 0
----------------------------------------------------------------------------------------------------------------------------------
65 SUBTOTAL 98.85% 0 60528 60328 200
----------------------------------------------------------------------------------------------------------------------------------
66 60971 CONTINGENCY 100.00% 713 713 0
----------------------------------------------------------------------------------------------------------------------------------
67 SUBTOTAL 98.87% 0 61241 61041 200
----------------------------------------------------------------------------------------------------------------------------------
68 60981 CONTRACTORS FEES @ 5% 98.87% 0 3062 3052 10
----------------------------------------------------------------------------------------------------------------------------------
69 SUBTOTAL 98.87% 0 64303 64094 210
----------------------------------------------------------------------------------------------------------------------------------
70 60991 GENERAL CONDITIONS 175.86% 153 153 0
----------------------------------------------------------------------------------------------------------------------------------
71 60103 Cleanup 72.22% 325 325 0
----------------------------------------------------------------------------------------------------------------------------------
72 60191 Project Supervision 98.59% 1488 1479 9
----------------------------------------------------------------------------------------------------------------------------------
73 60321 Insurance & Benefits 98.63% 254 252 1
----------------------------------------------------------------------------------------------------------------------------------
74 TOTAL CONSTRUCTION COSTS 98.78% 0 66523 66303 220
----------------------------------------------------------------------------------------------------------------------------------
Page 5
<PAGE> 48
THIRD AMENDMENT TO LEASE
I. PARTIES AND DATE.
This Third Amendment to Lease ("Amendment") dated as of August 22,
1991 (the "Execution Date"), is entered into by and between THE IRVINE COMPANY,
a Michigan corporation ("Landlord"), and KOFAX IMAGE PRODUCTS, a California
corporation ("Tenant").
II. RECITALS.
Landlord and Tenant have entered into that certain Standard Form Lease
(Multi-Tenant) dated as of March 31, 1988, as amended by that certain First
Amendment to Lease, dated March 7, 1990 as further amended by that certain
Second Amendment to Lease, dated May 4, 1990 (as amended, the "Lease"),
concerning certain premises ("Premises") located at 3 Jenner Street, Suite 100
and 150, Irvine, California 92718.
Landlord and Tenant now desire to modify the Lease to extend the Term
of the Lease, to expand the Premises to include an additional Seven Thousand
Seven Hundred and Five (7,705) gross square feet of space more particularly
shown on Exhibit "1" attached hereto and incorporated herein by reference
("Additional Space"), to establish the Monthly Rent to be paid by Tenant and as
otherwise herein provided, all as more fully set forth in this Amendment.
III. MODIFICATIONS.
Landlord and Tenant hereby agree that the Lease shall be modified
and/or supplemented as follows, which modifications and supplements shall be
effective as of the date of this Amendment and except as otherwise specifically
provided herein.
A. Expanded Premises. Landlord hereby leases the Additional Space to
Tenant, and Tenant hereby leases the Additional Space from Landlord, on the same
terms and conditions as set forth in the Lease, as supplemented hereby. From and
after the "Extension Commencement Date" (as hereinafter defined), the "Premises"
(as defined in the Lease) shall consist of the Premises described in the Lease
as amended, together with the Additional Space described in Exhibit "1" to this
Amendment.
B. Term. As set forth in Paragraph (k) of the Lease Summary, the Term
is currently contemplated to expire on November 15, 1991. Landlord and Tenant
hereby agree to extend the Term for thirty-six (36) months, commencing on
November 16, 1991 (the "Extension Commencement Date") and expiring on November
15, 1994, unless sooner terminated as provided in the Lease.
C. Additional Space Improvements. Landlord shall construct the Tenant
Improvements for the Additional Space (the "Additional Space Improvements") in
accordance with the Work Letter attached hereto as Exhibit "2" and incorporated
herein by reference. Tenant shall have the right of early entry on and within
the Additional Space on and after October 15, 1991, subject to the provisions of
Section 4(b) of the Lease, for purposes of installing Tenant's fixtures and
equipment.
1.
<PAGE> 49
D. Square Footage of Premises. From and after the Extension
Commencement Date, the definition of "Premises Square Footage" in Paragraph 3 of
the Second Amendment to Lease is hereby amended to mean an aggregate of 33,075
square feet.
E. Monthly Rent For Additional Space. Commencing on the Extension
Commencement Date, Tenant shall pay to Landlord Monthly Rent (as provided in
Paragraph 5(a) of the Lease) during the Term (as herein extended) as follows:
<CAPTION>
MONTHS FROM EXTENSION
COMMENCEMENT DATE MONTHLY RENT
----------------- ------------
Months 1-36 $21,829.50
Monthly Rent for the partial month in which the Extension Commencement Date
occurs shall be prorated as set forth in Paragraph 5(d) of the Lease. Further,
if the Additional Space Improvements are not "substantially completed" (as
defined in Section 4(a) of the Lease) on or before the Extension Commencement
Date, except for Tenant Delays as defined in the Work Letter, then Tenant shall
pay Monthly Rent only for the original Premises (at the rate of $.66 per square
foot per month) until the Additional Space Improvements are substantially
completed.
F. Tenant's Percentage. The Tenant's Percentage (as set forth in
Paragraph (q) of the Lease Summary) shall be increased to 22.79%. Such increase
shall take effect as of the Extension Commencement Date.
G. Vehicle Parking Spaces. The number of vehicle parking spaces shall
be increased to One Hundred Thirty-Two (132). Such increase shall take effect as
of the Extension Commencement Date.
H. Security Deposit. The Security Deposit shall not be increased as
the result of this Amendment.
I. Option to Lease Additional Vacant Space. Provided that no Event of
Default has occurred and is continuing, Tenant shall have the option to lease
the option space in accordance with Exhibit "3" to this Amendment.
J. Option to Terminate. Provided that no Event of Default has occurred
and is continuing, Tenant shall have the option to terminate the Lease in
accordance with Exhibit "4" to this Amendment.
K. Option to Extend. Provided that no Event of Default has occurred and
is continuing, Tenant shall have the option to extend the Term of this Lease in
accordance with Exhibit "5" to this Amendment.
L. Environmental Questionnaire; Disclosure. Paragraph 10(b) of the
Lease shall be supplemented as follows:
(iv) Prior to the execution of this Amendment, Tenant shall
complete, execute and deliver to Landlord an Environmental Questionnaire and
Disclosure Statement (the "Environmental Questionnaire") in the form of Exhibit
"6" to this Amendment and Tenant shall certify to Landlord all information
contained in the Environmental Questionnaire as true and correct to the best of
Tenant's knowledge and belief. The completed Environmental Questionnaire shall
be deemed incorporated into the Lease for all purposes, and Landlord shall be
entitled to rely
2.
<PAGE> 50
fully on the information contained therein. On each anniversary of the Extension
Commencement Date (each such date is hereinafter referred to as a "Disclosure
Date"), until and including the first Disclosure Date occurring after the
expiration or sooner termination of this Lease, Tenant shall disclose to
Landlord in writing the names and amounts of all Hazardous Materials, or any
combination thereof, which were stored, generated, used or disposed of on, under
or about the Premises by Tenant, its agents, employees, contractors or invitees
for the twelve-month period prior to and after each Disclosure Date, or which
Tenant intends to store, generate, use or dispose of on, under or about the
Premises. At Landlord's option, Tenant's disclosure obligations under this
Paragraph 10(b)(iv) shall include a requirement that Tenant update, execute and
deliver to Landlord the Environmental Questionnaire, as the same may be modified
by Landlord from time to time.
M. TCE Notification. Landlord has been informed by certain local and
state agencies that the Marine Corps Air Station at El Toro has discharged
trichloroethylene (TCE), a commonly used solvent, into the groundwater
underlying the Air Station and that this substance may have migrated into the
groundwater underlying the Premises. The Environmental Protection Agency, the
Santa Ana Region of the Regional Water Quality Control Board and the Orange
County Health Care Agency are overseeing the cleanup of this contamination. The
groundwater in this area currently is used for irrigation purposes only.
Therefore no practical impediment to the use or occupancy of the Premises is
anticipated to result from this discharge.
IV. GENERAL.
A. Effect of Amendments. Except to the extent the Lease is modified by
this Amendment, the remaining terms and provisions of the Lease shall remain
unmodified and in full force and effect. In the event of conflict between the
terms of the Lease and the terms of this Amendment, the terms of this Amendment
shall prevail.
B. Entire Agreement. This Amendment embodies the entire understanding
between Landlord and Tenant with respect to its subject matter and can be
changed only by an instrument in writing signed by Landlord and Tenant.
C. Counterparts. If this Amendment is executed in counterparts, each
counterpart shall be deemed an original.
D. Defined Terms. All capitalized terms used and not otherwise defined
in this Amendment, but defined in the Lease, shall have the same meaning in this
Amendment as in the Lease.
E. Corporate and Partnership Authority. If Tenant is a corporation or
partnership, or is comprised of either or both of them, each individual
executing this Amendment for the corporation or partnership represents that he
or she is duly authorized to execute and deliver this Amendment for the
corporation or partnership in accordance with its terms.
3.
<PAGE> 51
F. Attorneys' Fees. In the event any action is instituted for breach of
or to enforce any provision of the Lease or this Amendment, the prevailing party
in said action shall be entitled to its reasonable attorney's fees and court
costs incurred in such action. Each party shall bear its own attorney's fees, if
any, incurred in connection with the negotiation and preparation of this
Amendment.
"Landlord":
THE IRVINE COMPANY,
a Michigan Corporation
By: ROBERT E. WILLIAMS, JR.
---------------------------------------
Name: Robert E. Williams, Jr.
Its: Vice President
[SEAL]
By: JEFFREY L. DEIS
---------------------------------------
Name: Jeffrey L. Deis
Its: Assistant Secretary
"Tenant":
KOFAX IMAGE PRODUCTS,
a California Corporation
By: DAVID SILVER
---------------------------------------
Name: David Silver
Its: President
By: RONALD J. FIKERT
----------------------------------------
Name: Ronald J. Fikert
Its: Secretary
4.
<PAGE> 52
EXHIBIT 1
ADDITIONAL SPACE
3 JENNER SUITE 160
7,705 S.F.
[GRAPH]
<PAGE> 53
EXHIBIT 2
WORK LETTER
(TENANT IMPROVEMENT ALLOWANCE)
INDUSTRIAL
In connection with that certain Third Amendment to Lease (the
"Amendment") to which this EXHIBIT 2 (this "Work Letter") is attached, and in
consideration of the mutual covenants contained in the Amendment and in this
Work Letter, Landlord and Tenant agree as follows:
1. APPLICATION OF EXHIBIT
Capitalized terms used and not otherwise defined herein shall have the
same definitions as set forth in the Amendment. The provisions of this Work
Letter shall apply to the planning and completion of leasehold improvements
requested by Tenant (the "Additional Space Improvements") for the fitting out
of the initial Premises and Additional Space, as more fully set forth herein.
2. LANDLORD AND TENANT PRE-CONSTRUCTION OBLIGATIONS
(a) PRELIMINARY PLANS. Attached to this Work Letter as Schedule I are
preliminary space plans for the Additional Space Improvements (the "Preliminary
Plans"), which include, without limitation, sketches and/or drawings showing
locations of doors, partitioning, electrical fixtures, outlets and switches,
plumbing fixtures, floor loads and other requirements. Tenant acknowledges that
the Preliminary Plans have been prepared by Landlord's Architect after
consultation and cooperation between Tenant and Landlord's Architect regarding
the proposed Tenant Improvements and preparation of the Preliminary Plans for
same. Landlord and Landlord's Architect shall be entitled, in all respects, to
rely upon all information supplied by Tenant regarding the Additional Space
Improvements, and in all cases the Preliminary Plans (i) shall be subject to
Landlord's final approval, which approval shall not be unreasonably withheld,
(ii) shall not be in conflict with building codes for the City of Irvine or
with insurance regulations for a fire resistive Class A building, and (iii)
shall be in a form satisfactory to appropriate governmental authorities
responsible for issuing permits and licenses required for construction. The
costs associated with preparation of the Preliminary Plans shall be borne by
Tenant and paid as set forth in Section 5 and Section 6 of this Work Letter.
(b) PRELIMINARY PRICE ESTIMATE. Attached to this Work Letter as
Schedule II is an estimated breakdown of the construction costs for the Tenant
Improvement Costs (as hereinafter defined) based on the Preliminary Plans (the
"Preliminary Price Estimate"), including the cost of the Preliminary Plans and
Working Drawings and any and all fees, prepared by Landlord in conjunction with
the Contractor (as hereinafter defined). The Preliminary Price Estimate will be
updated and revised as necessary.
(c) APPROVAL OF PRELIMINARY PLANS AND PRELIMINARY PRICE ESTIMATE.
Tenant acknowledges that Tenant's execution of the Amendment shall be conclusive
evidence that Tenant has reviewed and approved the Preliminary Plans and the
Preliminary Price Estimate.
(d) WORKING DRAWINGS. Within fourteen (14) days following full
execution of this Amendment by both Landlord and Tenant, Landlord's Architect
shall prepare working drawings (the "Working Drawings") for the Additional
Space Improvements based upon the approved Preliminary Plans. The Working
Drawings shall include architectural, mechanical and electrical construction
drawings for the Additional Space Improvements based on the Preliminary Plans.
The costs associated with preparation of the Working Drawings shall be borne by
Tenant and paid as set forth in Section 5 and Section 6 of this Work Letter.
(e) APPROVAL OF WORKING DRAWINGS. Landlord or Landlord's Architect
shall submit the Working Drawings to Tenant for Tenant's review, and Tenant
shall notify Landlord and Landlord's Architect within five (5) days after
delivery thereof of any requested revisions. Within five (5) days after receipt
of Tenant's notice, Landlord's Architect shall make all approved revisions to
the Working Drawings and submit two (2) copies thereof to Tenant for its final
review and approval, which approval shall be given within three (3) days
thereafter. Concurrently with the above review and approval process, Landlord
may submit all plans and specifications to City and other applicable
governmental agencies in an attempt to expedite City approval and issuance of
all necessary permits and licenses to construct the Additional Space
Improvements as shown on the Working Drawings. Any changes which are required by
City or other governmental entity shall be immediately submitted to Landlord for
Landlord's review and reasonable approval, and Landlord shall promptly notify
Tenant of such changes.
(f) SCHEDULE OF CRITICAL DATES. Set forth below is a schedule of
certain critical dates relating to Landlord's and Tenant's respective
obligations with respect to the design and construction of Tenant's
Improvements for the Premises and the Additional Space. Such dates and the
respective obligations of Landlord and Tenant are more fully described
elsewhere in this Work Letter. The purpose of the following schedule is to
provide a reference for Landlord and Tenant and to make certain the Final
Approval Date occurs as set forth herein. Following the Final Approval Date,
Tenant shall be deemed to have released Landlord to commence construction of
the Additional Space Improvements as set forth in Section 4 below.
<CAPTION>
REFERENCE DATE DUE RESPONSIBLE PARTY
--------- -------- -----------------
A. "Preliminary Plan Approval" The date of execution of Amendment. Tenant and
Landlord
B. "Preliminary Price Estimate Approval" The date of execution of Amendment. Tenant
C. "Working Drawings Completion" Fourteen (14) days after full execution of Amendment Landlord
D. "Working Drawings Review" Five (5) days after Landlord submits the Working Draw-
ings to Tenant Tenant
E. "Working Drawings Revision" Five (5) days after Tenant returns the Working Drawings
to Landlord Landlord
F. "Final Approval Date" Three (3) days after Landlord submits the revised Work-
ing Drawings to Tenant Tenant
3. BUILDING PERMIT
After the Final Approval Date has occurred, Landlord shall, if Landlord
has not already done so, submit the Working Drawings to the appropriate
governmental body or bodies for final plan checking and a building permit.
Landlord, with Tenant's cooperation, shall cause to be made any change in the
Working Drawings necessary to obtain the building permit; provided, however,
after the Final Approval Date, no changes shall be made to the Working Drawings
without he prior written approval of both Landlord and Tenant, and then only
after agreement by Tenant to pay any excess costs resulting from such changes.
4. CONSTRUCTION OF TENANT IMPROVEMENTS
After the Final Approval Date has occurred and a building permit for
the work has been issued, Landlord shall, through a guaranteed maximum cost
construction contract ("Construction Contract")* with a reputable, licensed
contractor selected by Landlord ("Contractor"), (and reasonably acceptable to
Tenant), cause the construction of the Additional Space Improvements to be
carried out in substantial conformance with the Working Drawings in a good
C-1
* Landlord agrees to rebid the Additional Space Improvements and shall make a
good faith effort to come as close as possible to the June 12, 1991 bid of
J-Mar Construction for the cost of such Improvements.
<PAGE> 54
and workmanlike manner using first-class materials. The costs associated with
the construction of the Additional Space Improvements shall be paid as set forth
in Section 5 and Section 6 of this Work Letter. Landlord shall see that the
construction complies with all applicable building, fire, health and sanitary
codes and regulations, the satisfaction of which shall be evidenced by a
certificate of occupancy for the Additional Space.
5. TENANT IMPROVEMENT ALLOWANCE
(a) Tenant Improvements. Landlord shall provide Tenant with a Tenant
Improvement Allowance in the amount of sixty-thousand ($60,000) towards the cost
of the design, purchase and construction of the Additional Space Improvements,
including without limitation design, engineering and consulting fees
(collectively, the "Tenant Improvement Costs"). The Tenant Improvement Allowance
shall be used for payment of the following Tenant Improvement Costs:
(i) Preparation by Landlord's Architect of the Preliminary
Plans and the Working Drawings as provided in Section 2 of this Work
Letter, including without limitation all fees charged by City (including
without limitation fees for building permits and plan checks) in
connection with the Tenant Improvements work in the Premises;*
(ii) Construction work for completion of the Tenant
Improvements as reflected in the Construction Contract, including
without limitation the costs for materials listed in the Quality of
Construction Material Letter attached to this Work Letter as SCHEDULE
III;
(iii) all contractors' charges, general conditions and
construction fees; and
(iv)
6. COSTS IN EXCESS OF TENANT IMPROVEMENT ALLOWANCE AT TENANT'S EXPENSE
(a) Cost Approval. Tenant shall pay the excess of the Tenant
Improvement Costs over the amount of the Tenant Improvement Allowance available
to defray such costs. Concurrent with the plan checking referred to in Section
3 of this Work Letter, Landlord shall prepare and submit to Tenant a written
estimate of the amount of the remaining Tenant Improvement Costs and the cost
of the Tenant Improvement Allowance still available to defray such costs (after
preparation of the Preliminary Plans and Working Drawings). Tenant shall
approve or disapprove any such estimate by written notice to Landlord within
three (3) days after receipt thereof. If Tenant fails to notify Landlord of its
disapproval within such three (3) day period, Tenant shall be deemed to
have approved such estimate. If such estimate exceeds the Tenant Improvement
Allowance then still available and Tenant approves such estimate, Tenant's
notice of approval shall include payment to Landlord for the full amount of
such excess. If Tenant disapproves such estimate within the three (3) day
period, Landlord shall not proceed with the Tenant Improvements, but Landlord
and Tenant shall thereafter meet and cooperate to amend the Working Drawings
for the Premises as necessary to obtain Tenant's approval of the cost thereof,
provided that Tenant shall pay any costs resulting from such changes and Tenant
shall be liable for the delay in completing the Tenant Improvements and the
increased costs, if any, resulting from such delay.
(b) Final Costs. Upon completion by Landlord of the Tenant
Improvements, Landlord shall determine the actual final Tenant Improvements
Costs and shall submit a written statement of such amount to Tenant. If any
estimate previously paid by Tenant exceeds the amount due hereunder from Tenant
for such work, such excess shall be refunded to Tenant. On the other hand if any
amount is still due from Tenant for such work, then Tenant shall pay such amount
in full within ten (10) days of receipt of Landlord's statement. (See Workletter
Rider 6)
7. CHANGE ORDERS
Tenant may from time to time request and obtain change orders during the
course of construction provided that: (i) each such request shall be reasonable,
shall be in writing and signed by or on behalf of Tenant, and shall not result
in any structural change in the Building, as reasonably determined by Landlord,
(ii) all additional charges and costs, including without limitation
architectural and engineering costs, construction and materials costs, and
processing costs of any governmental entity shall be the sole and exclusive
obligation of Tenant, and (iii) any resulting delay in the completion of the
Additional Space Improvements shall be deemed a Tenant Delay and in no event
shall extend the Commencement Date of the Lease. Upon Tenant's request for a
change order, Landlord shall as soon as reasonably possible submit to Tenant a
written estimate of the increased or decreased cost and anticipated delay, if
any, attributable to such requested change. Within three (3) days of such
estimated cost adjustment and delay are delivered to Tenant, Tenant shall advise
Landlord whether it wishes to proceed with the change order, and if Tenant
elects to proceed with the change order, Tenant shall remit, concurrently with
Tenant's notice to proceed, the amount of the increased cost, if any,
attributable to such change order. Unless Tenant includes in its initial change
order request that the work in process at the time such request is made be
halted pending approval and execution of the change order, Landlord shall not be
obligated to stop construction of the Additional Space Improvements, whether or
not the change order relates to the work then in process or about to be started.
8. TENANT DELAYS
In no event shall the Extension Commencement Date be extended or
delayed due or attributable to delays due to the fault of Tenant ("Tenant
Delays"). Tenant Delays shall include, but are not limited to, delays caused by
or resulting from any one or more of the following:
(a) Tenant's failure to timely review and reasonably approve the
Working Drawings or to furnish information to Landlord for the preparation by
Landlord of the Working Drawings;
(b) Tenant's request for or use of special materials, finishes or
installments which are not readily available, provided that Landlord shall
notify Tenant in writing that the particular material, finish, or installation
is not readily available promptly upon Landlord's discovery of same;
(c) Delays of any nature, whether or not within Tenant's control,
resulting from Tenant's decision to use any materials, finishes or installations
other than "building standard" materials, finishes or installations;
(d) Change orders requested by Tenant;
(e) Interference by Tenant or by Tenant's agents, employees,
contractors or subcontractors with Landlord's construction activities;
(f) Tenant's failure to approve any other item or perform any other
obligation in accordance with and by the dates specified herein or in the
Construction Contract;
(g) Tenant's requested changes in the Preliminary Plans, Working
Drawings or any other plans and specifications after the approval thereof by
Tenant or submission thereof by Tenant to Landlord;
(h) Tenant's failure to approve written estimates of costs in
accordance with this Work Letter; and
(i) Tenant's obtaining or failure to obtain any necessary governmental
approvals or permits for Tenant's intended use of the Additional Space.
If the Extension Commencement Date of the Lease is delayed by any Tenant Delays,
whether or not within the control of Tenant, then the Extension Commencement
Date and the payment of Rent shall be accelerated by the number of days of such
delay. Landlord shall give Tenant written notice within a reasonable time of any
circumstance that Landlord believes constitutes a Tenant Delay.
*If Tenant has paid for the cost of the Preliminary Plans or the Working
Drawings, Tenant shall be reimbursed for such cost from the Tenant Improvement
Allowance.
C-2
<PAGE> 55
9. TRADE FIXTURES AND EQUIPMENT
Tenant acknowledges and agrees that Tenant is solely responsible for
obtaining, delivering and installing in the Premises and the Additional Space
all necessary and desired furniture, trade fixtures, equipment and other similar
items, and that Landlord shall have no responsibility whatsoever with regard
thereto. Tenant further acknowledges and agrees that neither the Extension
Commencement Date nor the payment of Rent shall be delayed for any period of
time whatsoever due to any delay in the furnishing of the Premises with such
items.
10. FAILURE OF TENANT TO COMPLY
Any failure of Tenant to comply with any of the provisions contained in
this Work Letter within the times for compliance herein set forth shall be
deemed a default under the Lease. In addition to the remedies provided to
Landlord in this Work Letter, upon the occurrence of such a default by Tenant.
Landlord shall have all remedies available at law or equity to a landlord
against a defaulting tenant pursuant to a written lease, including but not
limited to those set forth in the Lease.
C-3
<PAGE> 56
[MAP]
<PAGE> 57
SCHEDULE II
TENANT IMPROVEMENT
COST ESTIMATE SHEET
DATE: JUNE 19, 1991
-------------
TENANT: KOFAX IMAGE PRODUCTS SUITE NO. SQ. FT.
--------------------------- ----------- -----------
PROJECT: IRVINE/SAMMIS VENTURE JOB NO. 3 Jenner Street, Suite 100
-------------------------- --------------------------
Prepared by: T. Redler
----------------------
Xc: Tom Williams/Gary Cropp
-------------------------------
<CAPTION>
DESCRIPTION QUANTITY UNIT PRICE TOTAL COST
----------- ---------- ------------ ----------
Demolition of partition walls 406 lf. 9.00 lf. $ 3,654.00
Cut-in openings 16 85.00 ea. 1,360.00
Fill-in openings 6 125.00 ea. 750.00
Partition walls @ 9' 70 lf. 21.00 lf. 1,470.00
Demising walls @ 20' 20 lf. 55.00 lf. 1,100.00
Misc. drywall repairs lump sum 500.00
Suspended acoustical ceilings 2,205 sf. 1.00 sf. 2,205.00
Misc. suspended ceiling repairs lump sum 750.00
Provide support for folding partition lump sum 750.00
Interior door removal 23 50.00 ea. 1,150.00
Interior door re-installation 11 85.00 ea. 935.00
Interior door supply & install (3'0" x 8'0") 1 350.00 ea. 350.00
Interior door (fire-rated 6'0" x 8'0" pair) 3 986.00 ea. 2,958.00
Interior folding partition door (18'0" x 9') 1 2,160.00 ea. 2,160.00
Interior window frames 7 180.00 ea. 1,260.00
Interior window glass 132 sf. 6.50 sf. 858.00
Cabinetry 24 lf. 230.00 lf. 5,520.00
Electrical duplexes 13 42.00 ea. 546.00
Dedicated duplexes 3 95.00 ea. 285.00
Plugmolding 245 lf. 9.00 lf. 2,205.00
Title 24 light switches 5 55.00 ea. 275.00
Telephone outlets 6 22.00 ea. 132.00
Partition telephone outlets 5 30.00 ea. 150.00
Firewall electrical wraps 38 10.00 ea. 380.00
Electrical light fixtures 32 95.00 ea. 3,040.00
Single circuit 120V/20A J-box 1 112.00 ea. 112.00
Three circuit 120V/20A J-box 4 225.00 ea. 900.00
Demo duplexes 38 7.00 ea. 266.00
Demo telephone outlets 18 7.00 ea. 126.00
Demo CRT outlets 8 7.00 ea. 56.00
Demo light switches 16 7.00 ea. 112.00
Demo strip fixtures 16 7.00 ea. 112.00
HVAC power to disconnect 10 tn 140.00 tn 1,400.00
Exhaust fan power connection w/switch 1 150.00 ea. 150.00
Electrical design fee lump sum 1,590.00
H.V.A.C.
5 ton heat pumps 2
Exhaust fans 1
Thermostats 2
Thermostats (relocated) 5
Supply air registers 16
Return air registers 7
Supply air registers (relocated) 5
Return air registers (relocated) 1
Control panel 1
Water piping & condensate
Design fee lump sum 15,435.00
Plumbing R&R exst'ng watercloset w/trbo 8 315.00 ea. 2,520.00
St. steel sink w/garb. disp. (dishwshr. N.I.C.) 1 lump sum 800.00
Painting 15,030 sf. .18 sf. 2,705.00
Fire Sprinklers 25 115.00 ea. 2,875.00
Carpeting (excluding furniture removal) 874 sy. 14.25 sy. 12,455.00
Vinyl composition floor tile (exc. furn. rm) 5,580 sf. 1.35 sf. 7,533.00
Blueprint/plan reproduction lump sum 80.00
Architectural fee lump sum 2,800.00
Plancheck & permit fees lump sum 2,700.00
----------
*SUBTOTAL $89,470.00
Contingency 89,470.00 1% 895.00
General contractor's fee 90,365.00 5% 4,518.00
General conditions (Insur. salaries. cleanup) lump sum 4,685.00
----------
**TOTAL CONSTRUCTION COSTS 94,833.00
1
<PAGE> 58
DATE: JUNE 19, 1991
-------------
TENANT: KOFAX IMAGE PRODUCTS SUITE NO. SQ. FT.
--------------------------- ----------- -----------
PROJECT: IRVINE/SAMMIS VENTURE JOB NO. 3 Jenner Street, Suite 100
-------------------------- --------------------------
Prepared by: T. Redler
----------------------
Xc: Tom Williams/Gary Cropp
-------------------------------
<CAPTION>
DESCRIPTION QUANTITY UNIT PRICE TOTAL COST
----------- ---------- ------------ -----------
Original cost for labor and material only $ 89,470.00
Added cost for construction in (3) phases 13,421.00
-----------
SUBTOTAL $102,891.00
Contingency 102,891.00 1% 1,029.00
General Contractor's fee 103,920.00 5% 5,196.00
General Conditions (insur. salaries, cleanup) lump sum 5,801.00
-----------
TOTAL CONSTRUCTION COST $114,917.00
Additional options:
a) Complete painting of adjoining suite 2,360 sf. .18 sf. 425.00
b) Complete air balance rms. #112, #149, #150 and #151
c) Dual thermostatic control rms. #138, #140 lump sum 175.00
c.2.) 1.5 ton HVAC unit lump sum 3,545.00
d) Carpet replacement @ entry & corridor 189 sy. 14.25 sy. 2,693.00
e) Cost for added partitions 20 lf. 18.00 lf. 360.00
f) Installation of flush valves to exs'tng restrooms 8 135.00 ea. 1,080.00
f.2.) Two additional flush valve toilets 2 450.00 ea. 900.00
g) Exterior sign removal & repainting lump sum 150.00
h) New exterior sign installation "Kofax" lump sum 571.00
i) Increased allowance for folding partition door lump sum 2,500.00
j) Demolition of partition walls, room #105 18 lf. 9.00 lf. 162.00
Associated drywall repair lump sum 100.00
-----------
Subtotal Options Cost $ 12,821.00
General Contractor's fee 12,821.00 5% 641.05
-----------
Total Options Cost $ 13,462.05
Total Construction Cost 114,917.00
-----------
GRAND TOTAL OPTIONS AND CONSTRUCTION COST $128,379.05
===========
2
<PAGE> 59
Schedule III
Quality of Construction Material Letter
PROJECT: Irvine/Sammis Venture
Irvine, California
REFERENCE: 3 Jenner
DESCRIPTION OF ITEMS
The following listed items represent the quality of materials to be
provided in the Preliminary Cost Estimate provided by Landlord for the Tenant
Improvements.
1. DEMISING PARTITION
6", 20 gauge steel studs at 16" o.c. with 5/8" type "x" gypsum board
each side. Installed from slab to structure above. R-19 batt
insulation in wall cavity.
2. INTERIOR PARTITION
3 5/8", 25 gauge steel studs at 24" o.c. with 5/8" type "x" gypsum
board each side installed from slab to underside of ceiling grid with
seismic bracing per City of Irvine Building Code.
Office to warehouse interior partition: 3-5/8" 25 gauge steel studs at
24" on center with 5/8" type "x" gypsum board each side installed from
slab to 6" above ceiling. R-11 batt insulation in cavity.
3. SINGLE INTERIOR DOOR
1-3/4" solid core : Legacy "Mendicino oak" 3'-0 x 8'-0 set in 3'-0 x
8'-0" Timely prefinished metal section frame door. Latch shall be
Schlage D-10-S-626 "Olympiad" lever design in brushed chrome finish,
or equal.
4. ACOUSTICAL CEILING
2'x 4' white enameled steel grid, 800 series by Chicago Metallic (or
equal). Ceiling tile shall be Armstrong 2 x 4 lay-in 755B natural
fissured. Installed at 9'-0" AFF.
5. LIGHT FIXTURES
2' x 4' recessed fluorescent light fixture with 3 lamps, energy saving
ballast, and acrylic prismatic lens. Lithonia #2GT 440 RW A-12 277ES
(or equal).
6. Two (2) gang switches with ivory plastic cover plate.
7. DUPLEX OUTLETS
120 volt - 15 amp receptacle with ivory cover plate.
8. TELEPHONE OUTLET
Standard mudring without cover plate, conduit to 6" above ceiling.
9. EXIT SIGN
Exit signs as required by City. Illuminated with battery back up.
10. TELEPHONE BACKBOARD
2' x 4' or 4' x 8' plywood backboard with one (1) dedicated duplex
outlet and 1" conduit feed from telephone terminal board.
<PAGE> 60
11. ELECTRICAL SERVICE
120/208 to 277/480 available.
12. HEATING VENTILATION AND AIR CONDITIONING
Water source heat pump units with economizers and isolators. One
thermostat control per unit. Distribution through 2 x 2 louvreface
adjustable grill supply and perforated face diffuser.
13. FIRE EXTINGUISHER
Sampson model 99 fire cabinet with 2A 10BC minimum rated fire
extinguisher or equal.
14. SPRINKLER HEADS
Semi-recessed chrome heads in improved office area. Standard heads all
other areas.
15. COFFEE BAR (if planned)
Plastic laminate top on base cabinet with plastic laminate covered
doors over storage compartments. Stainless steel sink. 15" x 17" Elkay
#PSR-1517 with Elkay #LK2423 "Hi-Arc" faucet.
16. RESTROOM
"Sloan valve" type toilet meeting handicap standards. Wall mounted
sink(s).
Accessories: Handicap approved grab bars, toilet paper holder, 24 x 36
mirror over sink. Exhaust fan wired to wall mounted light fixture over
mirror.
Flooring shall be DAL-tile "Keystone" with color coordinate base to 4"
A.F.F.
Wet walls shall have F.R.P. to 48" above finished floor and water
based enamel paint to ceiling.
Ceiling to be 5/8" gyp board on 6" 20 gauge steel studs at 24" o.c.
with R-19 insulation at 8'2" above finished floor.
17. FLOOR COVERING
Office: Designweave "Dana Point" 32 oz. cut pile carpet. Installed
over 5/16" Nova cushion pad. Armstrong "Excelon 1/8". Vinyl
composition tile where specified.
18. BASE
2 1/2" Burke rubber base, color per building standard.
19. PAINT
Standard paint Frazee "Vinyl-Lux" latex paint with Eggshell finish. 2
coats to cover all walls.
20. WAREHOUSE LIGHTING
8'-0" strip fluorescent light fixtures for minimum warehouse lighting.
21. WINDOW COVERINGS
Miniblinds. Levolor "Riviera" #111 cotton white (exterior windows
only).
<PAGE> 61
WORK LETTER RIDER 6
(Amortization of Excess Costs)
The capitalized terms used and not otherwise defined herein shall have the
same definitions as set forth in the Lease to which the Work Letter relates. The
provisions of this Work Letter Rider shall supersede any inconsistent or
conflicting provisions of the Work Letter.
TO BE ADDED FOLLOWING SECTION 6(b):
(c) AMORTIZATION OF EXCESS COSTS. Provided that no Event of Default
under the Lease has occurred and is continuing, Tenant may elect, by
written notice delivered to Landlord within the time that Tenant is to pay
to Landlord any excess Tenant Improvement Costs, to have such excess costs
up to a maximum amount of Seventy Thousand Dollars ($70,000 ) amortized
over the initial Term of the Lease at a rate of twelve percent (12%) per
annum ("Amortization Rate"), with all such amortized amounts paid by Tenant
to Landlord as Additional Rent at the time and in the manner required for
Tenant to pay Monthly Rent as set forth in the Lease. Upon the occurrence
of any Event of Default under the Lease as amended, which is not cured
within any applicable grace and cure period as set forth in the Lease, as
amended, Landlord shall have the right to accelerate the remaining
principal balance of excess Tenant Improvement Costs amortized hereunder
and to require that the entire amount thereof be immediately paid in full
by Tenant. Should Tenant fail to pay such remaining principal amount within
five (5) business days after any written notice of such election by
Landlord, such principal amount shall thereafter bear interest at the
greater of the Amortization Rate or the Applicable Rate until paid.
<PAGE> 62
EXHIBIT "3"
Option to Lease Additional Vacant Space
THIS Exhibit "3" is attached to and made a part of that Third Amendment
to Lease ("Amendment") dated August 22, 1991 between THE IRVINE COMPANY, a
Michigan corporation, as "Landlord" and KOFAX IMAGE PRODUCTS, a California
corporation, as "Tenant", for the Premises known as 3 Jenner Street, Suite 100 &
150, Irvine, California. The capitalized terms used and not otherwise defined
herein shall have the same definitions as set forth in the Lease. The provisions
of this Exhibit "3" shall supersede any inconsistent or conflicting provisions
of the Amendment.
Provided no Event of Default has occurred and is continuing, Tenant
shall have the option (the "Option") to lease that certain space consisting of
approximately Five Thousand Eight Hundred Seventy-Two (5,872) square feet and
described on Schedule 1 to this Exhibit "3" (the "Option Space"), upon the
following terms and conditions:
(i) Tenant must exercise the Option by written notice to Landlord (the
"Option Notice") given to Landlord on or before February 15, 1993; provided,
however, that if Landlord shall obtain a "Letter of Intent" (as hereinafter
defined) from the existing tenant of the Option Space during the period between
November 15, 1992 and February 15, 1993, then Landlord shall give written notice
thereof to Tenant and, on or before the first to occur of: (i) thirty (30) days
from the giving of Landlord's notice (but no sooner than January 1, 1993), or
(ii) February 15, 1993, Tenant shall be obligated to deliver the Option Notice
to Landlord or lose the Option. As used herein, "Letter of Intent" shall mean a
non-binding letter of intent, or offer to lease the Option Space, executed by
the existing tenant thereof, or its broker or representative, setting forth the
terms and conditions on which said tenant would be willing to lease the Option
Space from and after April 30, 1993. If Tenant fails or elects not to exercise
the Option as above-provided, the option shall automatically terminate without
further action of the parties, and Landlord shall be free to lease the Option
Space to any third party upon such terms and conditions as Landlord desires.
(ii) If Tenant timely and properly exercises the Option, Tenant shall,
within fifteen (15) days after receipt from Landlord, enter into a new lease (on
Landlord's then current standard form for the Project) or an amendment to this
Lease for the Option Space, which new lease or amendment shall incorporate the
terms for the lease of the Option Space set forth herein. If Tenant fails to
execute and deliver said new lease or amendment within said fifteen (15) days,
then the Option shall automatically terminate without further action of the
parties and Landlord shall be free to lease the Option Space to any third party
upon such terms and conditions as Landlord desires.
(iii) If Tenant properly and timely exercises the Option, Tenant's
lease of the Option Space shall commence as of the date of substantial
completion of the Option Space Tenant Improvements (the "Option Space
Commencement Date") and shall expire on November 15, 1994. The parties
anticipate that the Option Space Commencement Date shall occur on May 15, 1993.
Tenant acknowledges that the existing tenant's lease for the Option Space
currently expires on April 30, 1993, and if for any reason Landlord cannot
deliver possession of the Option Space to Tenant on the Option Space
Commencement Date, then Landlord shall not be subject to any liability therefor,
nor shall such failure affect the validity
1.
<PAGE> 63
of this Lease or Tenant's obligation to lease the Option Space hereunder, but in
such case Tenant shall not be obligated to pay Monthly Rent or Additional Rent
for the Option Space until possession of the option space is tendered to Tenant
by Landlord; provided, however, if Landlord shall not have delivered possession
of the Option Space to Tenant with the Option Space Tenant Improvements
substantially completed on or before ninety (90) days from and after the Option
Space Commencement Date, plus periods due to Tenant Delays, then Tenant may, at
its option, by written notice given to Landlord within fifteen (15) days
thereafter, terminate the entire Lease as provided and subject to the terms and
conditions of Paragraph 1 of Exhibit "4" to this Lease, except that Tenant shall
not be obligated to pay that portion of the Termination Fee set forth in
Paragraph 3(c) of said Exhibit "4".
(iv) Tenant's Monthly Rent obligation under this Lease shall be
increased by $.66 per square foot of the Option Space (or Three Thousand Eight
Hundred Seventy-Five Dollars and Fifty-Two Cents ($3,875.52)) commencing on the
Option Space Commencement Date.
(v) Effective as of the Option Space Commencement Date, the number
of vehicle parking spaces shall be increased to one hundred fifty-five (155),
and the Tenant's Percentage (as set forth in Paragraph (q) of the Lease Summary)
shall be increased to 26.83%.
(vi) After Tenant's exercise of the Option, Landlord shall build
out the Option Space Tenant Improvements (as defined below), with a tenant
allowance not to exceed $5,872.00. Further, any excess tenant improvement costs
for such improvements, not to exceed Eleven Thousand Seven Hundred Forty-Four
Dollars ($11,744.00), shall be paid for by Landlord but fully amortized (at a
per annum interest rate of 12%) and paid for by Tenant over the remaining Term
of the Lease. As used herein, "Option Space Tenant Improvements" shall mean
removal of interior walls in the Option Space to be specified, demolition of
certain fixtures in the Option Space to be specified, repainting, recarpeting
and installation of interior office windows. Landlord shall build out the Option
Space Tenant Improvements in a good and workmanlike manner using a licensed,
reputable contractor, and in accordance with all applicable codes. The Option
Space Tenant Improvements shall be of like kind and quality with the Additional
Space Improvements (as defined in Section III.C. of this Amendment), and the
Option Space Commencement Date shall not be delayed by any requests by Tenant
for over-standard materials or finishes or by unreasonable interference with
Landlord's contractor. At the time of Tenant's exercise of the Option, the
parties shall mutually agree on a build-out schedule for the Option Space Tenant
Improvements with a completion date no later than May 15, 1993.
(vii) If Tenant properly and timely exercises the Option, Tenant's
Option to Terminate set forth in Exhibit "4" shall not be exercisable by Tenant
during the initial six (6) months from and after the Option Space Commencement
Date (except as specifically provided in Section (iii) above). Further, an
additional Termination Fee (in addition to the Fee set forth in Paragraph 3 of
Exhibit "4") shall be payable to Landlord if Tenant exercises its Option to
Terminate from and after six (6) months after the Option Space Commencement
Date, which additional fee shall be the sum of: (a) any unamortized excess
tenant improvement costs per Section (vi) above, plus (b) the product of $5,872
x 1/18 x (18 - the number of months that the Lease terminates after the option
Space Commencement Date).
(viii) Tenant's Option is personal to Tenant and may not be
exercised by or assigned to any person or entity other than Tenant, and shall
terminate and be of no further force or effect upon any subsequent assignment of
the Lease or subletting of more than fifty percent (50%) of the square footage
of the Premises.
2.
<PAGE> 64
SCHEDULE 1
EXHIBIT 3
ADDITIONAL VACANT SPACE
5 JENNER SUITE 190
5,862 S.F.
[MAP]
<PAGE> 65
Exhibit "4"
OPTION TO TERMINATE LEASE
THIS EXHIBIT "4" is attached to and made a part of that certain Third
Amendment to Lease (the "Amendment") dated August 22, 1991, between THE IRVINE
COMPANY, a Michigan corporation, as Landlord and KOFAX IMAGE PRODUCTS, a
California corporation, as Tenant. The capitalized terms used and not otherwise
defined herein shall have the same definitions as set forth in the Amendment.
The provisions of this Lease Rider shall supercede any inconsistent or
conflicting provisions of the Amendment.
1. Option To Terminate. Provided no Event of Default has occurred and is
continuing, Tenant shall have an ongoing option to terminate the Lease ("Option
to Terminate" or "Option"), on the terms and conditions herein set forth. The
option shall be exercisable by Tenant on the express conditions that, at the
time of the exercise of such Option and thereafter at all times prior to the
Termination Date, an Event of Default shall not have occurred and be continuing
under the Lease. If Tenant properly exercises the Option, "Term", as used herein
and in the Lease, shall be deemed to include the period from the exercise of the
Option through and including the Termination Date.
2. Exercise of option. Subject to the conditions set forth in this Lease
Exhibit, Tenant may exercise the option by delivering written notice of such
exercise to Landlord at any time during the Term after the twelfth (12th) month
following the Extension Commencement Date. The Lease shall thereafter terminate
on that date (the "Termination Date") which is ninety (90) days following
Tenant's giving of a valid notice of exercise of the Option.
3. Termination Fee. If Tenant exercises the Option, Tenant shall pay to Landlord
a fee (the "Termination Fee") equal to the sum of the amounts described in
subparagraphs (a) through (c) below:
(a) The unamortized cost of any excess Tenant Improvement
Costs (as defined and provided in Paragraph 6 of the Work Letter and in
Work Letter Rider 6) remaining unamortized as of the Termination Date.
(b) An amount to reimburse Landlord for a portion of its
brokerage commissions paid, determined as follows
<CAPTION>
Month During Which Commission
Termination Date Occurs Reimbursement
----------------------- -------------
16 - 24 [$436.59 x (24-M) + $4,365.86]
x (1.01)M
25 - 36 [$363.82 x (36-M)] x (1.01)M
Where: M = Number of months from November 16, 1991 through month
when Termination Date occurs.
1.
<PAGE> 66
(c) An amount determined as follows:
<CAPTION>
Termination Date occurs: Fee Per Month:
------------------------ --------------
16 - 18 $0.10 x P.S.F. x N
19 - 24 $0.05 x P.S.F. x N
25 - 36 $0.02 x P.S.F. x N
Where: N = Number of months from the Extension Commencement Date
through the month when the Termination Date occurs.
P.S.F. = Gross square footage of the Premises (including the Option
Space if Tenant has exercised the Option as provided in
Exhibit "3" and is occupying the Option Space).
The Termination Fee shall be paid in cash to Landlord upon the
Termination Date, and the Lease shall not be terminated unless and until the
Termination Fee is paid to Landlord. Notwithstanding the foregoing, in the event
that Landlord and Tenant shall execute, at any time prior to the Termination
Date, a new lease for space elsewhere in "Landlord's portfolio" containing at
least the same square footage as the Premises, then that portion of the
Termination Fee represented by subparagraphs 3(b) and 3(c) above shall be waived
by Landlord as part of such new lease with Tenant. As used herein, "Landlord's
portfolio" shall mean space in projects wholly owned or owned in joint venture
by Landlord.
4. Option Is Personal To Tenant. The Option is personal to Tenant.
If Tenant subleases more than fifty percent (50%) of the square footage of the
Premises or assigns or otherwise transfers any interest of the Lease prior to
the exercise of the Option, the Option shall lapse.
2.
<PAGE> 67
EXHIBIT 5
OPTION TO EXTEND TERM
(Fair Market Value Adjustment)
This Exhibit is attached to and made part of that certain Third
Amendment to Lease (the "Amendment") dated August 22 between THE IRVINE COMPANY,
a Michigan corporation, as Landlord, and KOFAX IMAGE PRODUCTS, a California
corporation, as Tenant. The capitalized terms used and not otherwise defined
herein shall have the same definitions as set forth in the Lease. The provisions
of this Lease Rider shall supersede any inconsistent or conflicting provisions
of the Lease.
A. OPTION(S) TO EXTEND TERM.
1. Landlord hereby grants to Tenant one (l) option(s) (the "Option(s)") to
extend the Term of the Lease for additional consecutive term(s) of three (3)
years and zero (0) months each (each is called an "Extension"), on the same
terms and conditions as set forth in the Lease, except the Monthly Rent shall be
the amount determined as set forth below. Each Option shall be exercised only by
written notice delivered to Landlord at least one hundred twenty (120) days
before the expiration of the initial Term of the Lease or the immediately
preceding Extension, as the case may be. If Tenant fails to deliver Landlord
written notice of the exercise of an option within the time period prescribed
above, such Option and any succeeding Options shall lapse, and there shall be no
further right to extend the Term of the Lease. Each Option shall be exercisable
by Tenant on the express conditions that (i) at the time of the exercise of such
Option, and thereafter at all times prior to the commencement of such Extension,
an Event of Default shall not have occurred and be continuing under the Lease
and (ii) Tenant has not been ten (10) or more days late in the payment of Rent
more than a total of three (3) times during the Term of the Lease. If Tenant
properly exercises an Option, "Term", as used herein and in the Lease, shall be
deemed to include the applicable Extension.
2. PERSONAL OPTIONS.
Each option is personal to Tenant. If Tenant subleases more than fifty
percent (50%) of the square footage of the Premises or assigns or otherwise
transfers any interest under the Lease prior to the exercise of an Option, such
option and any succeeding Options shall lapse. If Tenant subleases more than
fifty percent (50%) of the square footage of the Premises or assigns or
otherwise transfers any interest of Tenant under the Lease after the exercise of
an Option but prior to the commencement of the Extension to such option, such
Option and any succeeding Options shall lapse and the Term of the Lease shall
expire as if such Option were not exercised. If Tenant subleases more than fifty
percent (50%) of the square footage of the Premises or assigns or otherwise
transfers any interest of Tenant under the Lease after the exercise of an Option
and after the commencement of the Extension related to such option, then the
Term of the Lease shall expire upon the expiration of the Extension during which
such sublease or transfer occurred and only the succeeding Options shall lapse.
B. CALCULATION OF RENT.
The Monthly Rent during each Extension shall be increased, as of the
commencement of each Extension (each is called a "Rental Adjustment Date") to
ninety-five percent (95%) of the "Fair Market Value" of the Premises, determined
in the following manner: Not later than one hundred (100) days prior to any
applicable Rental Adjustment Date, Landlord and Tenant shall met in an effort to
negotiate, in good faith, the Fair Market Value of the Premises as of such
Rental Adjustment Date. If Landlord and Tenant have not agreed upon the Fair
Market Value of the Premises at least ninety (90) days prior to the
<PAGE> 68
applicable Rental Adjustment Date, the Fair Market Value shall be determined by
the following appraisal method:
(i) If Landlord and Tenant are not able to agree upon the Fair Market
Value of the Premises within the time period described above, then Landlord and
Tenant shall attempt to agree in good faith upon a single appraiser not later
than seventy-five (75) days prior to the applicable Rental Adjustment Date. If
Landlord and Tenant are unable to agree upon a single appraiser within such time
period, then Landlord and Tenant shall each appoint one appraiser not later than
sixty-five (65) days prior to the applicable Rental Adjustment Date. Within (10)
days thereafter, the two appointed appraisers shall appoint a third appraiser.
If either Landlord or Tenant fails to appoint its appraiser within the
prescribed time period, the single appraiser appointed shall determine the Fair
Market Value of the Premises. If both parties fail to appoint appraisers within
the prescribed time periods, then the first appraiser thereafter selected by a
party shall determine the Fair Market Value of the Premises. Each party shall
bear the cost of its own appraiser and the parties shall share equally the cost
of the single or third appraiser if applicable. All appraisers shall have at
least five (5) years' experience in the appraisal of commercial/industrial real
property in the area in which the Premises are located and shall be members of
professional organizations such as MAI or its equivalent.
(ii) For the purposes of such appraisal, the term "Fair Market Value"
shall mean the price that a ready and willing tenant would pay, as of the
applicable Rental Adjustment Date, as monthly rent, to a ready and willing
landlord of property comparable to the Premises if such property were exposed
for a lease of three (3) years with no options, on the open market for a
reasonable period of time, and taking into account all of the purposes for which
such property may be used. If a single appraiser is chosen, then such appraiser
shall determine the Fair Market Value of the Premises. Otherwise, the Fair
Market Value of the Premises shall be the arithmetic average of the two (2) of
the three (3) appraisals which are closest in amount, and the third appraisal
shall be disregarded. Landlord and Tenant shall instruct the appraiser(s) to
complete their determination of the Fair Market Value not later than thirty (30)
days prior to the applicable Rental Adjustment Date. If the Fair Market Value is
not determined prior to the applicable Rental Adjustment Date, then Tenant shall
continue to pay to Landlord the Monthly Rent applicable to the Premises
immediately prior to such Rental Adjustment Date until the Fair Market Value is
determined. When the Fair Market Value of the Premises is determined, Landlord
shall deliver notice thereof to Tenant, and Tenant shall pay to Landlord, within
(10) days after receipt of such notice, the difference between the Monthly Rent
actually paid by Tenant to Landlord and the new Monthly Rent determined
hereunder. In no event shall the Monthly Rent be reduced below the Monthly Rent
applicable to the Premises immediately prior to the applicable Rental Adjustment
Date.
2
<PAGE> 69
EXHIBIT "6" Page 1 of 3
IRVINE INDUSTRIAL COMPANY
ENVIRONMENTAL QUESTIONNAIRE AND DISCLOSURE STATEMENT
The purpose of this form is to obtain Information regarding the use of
hazardous substances on Irvine Industrial Company property. Prospective tenants
should answer the questions in light of their proposed operations on the
promises. Existing tenants should answer the questions as they relate to
on-going operations on the promises and should update any Information previously
submitted. if additional space Is needed to answer the questions, you may attach
separate sheets of paper to this form.
Your cooperation in this matter Is appreciated. Any questions should be
directed to, and when completed.. the form should be mailed to:
Asset Manager
The Sammis Company
6 Jenner Street, Suite 230
Attn: Irvine, California 92718
Phone: (714) 727-2011
1. GENERAL INFORMATION
Name of Responding Company. Kofax Image Products
Check the Applicable Status:
Prospective Tenant [ ] Existing Tenant [X]
Mailing Address: 3 Jenner Street
Irvine, California 92718
Contact Person and Title: Ron Fikert, Vice President
Telephone Number: (714) 727-1733
Address of Leased Promises: 3 Jenner Street, Irvine, California, 92718
Length of Lease Term: three (3) years
Describe the proposed operations to take place on the property, Including
principal products manufactured or services to be conducted. Existing
tenants should describe any proposed changes to on-going operations.
Research, development and test of add-in boards for PCs.
2. STORAGE OF HAZARDOUS MATERIALS
2.1 Will any hazardous materials be used or stored on-site?
Wastes Yes [ ] No [X]
Chemical Products Yes [ ] No [X]
2.2 Attach the list of any hazardous materials to be used or stored, the
quantities that will be on-site at any given time, and the location
and method of storage (e.g., 55 gallon drums on concrete pad).
3. STORAGE TANKS & SUMPS
3.1 Is any above or below ground storage of gasoline. diesel. or other
hazardous substances In tanks or sumps proposed or currently conducted
on the promises?
Yes [ ] No [X]
If yes, describe the materials to be stored, and the type, size and
construction of the sump or tank. Attach copies of any permits
obtained for the storage of such substances.
----------------------------------------------------------------------
----------------------------------------------------------------------
3.2 Have any of the tanks or sumps been Inspected or tested for leakage?
Yes [ ] No [ ]
If so, attach the results.
3.3 Have any spills or leaks occurred from such tanks or sumps?
Yes [ ] No [ ]
If so, describe.
3.4 Were any regulatory agencies notified of the spill or leak?
Yes [ ] No [ ]
If so, attach copies of any spill reports filed, any clearance letters
or other correspondence from regulatory agencies relating to the spill
or leak.
3.5 Have any underground storage tanks or sumps been taken out of service
or removed?
Yes [ ] No [ ]
If yes, attach copies of any closure permits and clearance obtained
from regulatory agencies relating to closure and removal of such
tanks.
<PAGE> 70
EXHIBIT "6" Page 2 of 3
4. SPILLS
4.1 During the past year, have any spills occurred on the premises?
Yes [ ] No [X]
If so, please describe the spill and attach the results of any testing
conducted to determine the extent of such spills.
4.2 Were any agencies notified in connection with such spills?
Yes [ ] No [ ]
If so, attach copies of any spill reports or other correspondence with
regulatory agencies.
4.3 Were any clean-up actions undertaken in connection with the spills?
Yes [ ] No [ ]
If so, briefly describe the actions taken. Attach copies of any
clearance letters obtained from any regulatory agencies involved and
the results of any final soil or groundwater sampling done upon
completion of the clean-up work.
----------------------------------------------------------------------
----------------------------------------------------------------------
5. WASTE MANAGEMENT
5.1 Has your company been issued an EPA Hazardous Waste Generator I.D.
Number?
Yes [ ] No [X]
5.2 Has your company filed a biennial report as a hazardous waste
generator?
Yes [ ] No [ ]
If so, attach a copy of the most recent report filed.
5.3 Attach the list of the hazardous waste, if any, generated or to be
generated at the premises, its hazard class and the quantity generated
on a monthly basis.
5.4 Describe the method(s) of disposal for each waste. Indicate where and
how often disposal will take place.
----------------------------------------------------------------------
----------------------------------------------------------------------
5.5 Indicate the name of the person(s) responsible for maintaining copies
of hazardous waste manifests completed for off-site shipments of
hazardous waste.
5.6 Is any treatment or processing of hazardous wastes currently conducted
or proposed to be conducted at the premises:
Yes [ ] No [ ]
If yes, please describe any existing or proposed treatment methods.
----------------------------------------------------------------------
----------------------------------------------------------------------
5.7 Attach copies of any hazardous waste permits or licenses issued to
your company with respect to its operations on the premises.
6. WASTEWATER TREATMENT/DISCHARGE
6.1 Do you discharge wastewater to:
[ ] storm drain? [ ] sewer?
[ ] surface water? [X] no industrial discharge
6.2 Is your wastewater treated before discharge?
Yes [ ] No [ ]
If yes, describe the type of treatment conducted.
----------------------------------------------------------------------
6.3 Attach copies of any wastewater discharge permits issued to your
company with respect to its operations on the premises.
7. AIR DISCHARGES
7.1 Do you have any air filtration systems or stacks that discharge into
the air?
Yes [ ] No [X]
2
<PAGE> 71
EXHIBIT "6" Page 3 of 3
7.2 Do you operate any of the following types of equipment, or any other
equipment requiring an air emissions permit?
[ ] Spray booth
[ ] Dip tank
[ ] Drying oven
[ ] Incinerator
[ ] Other (Please Describe)
[X] No Equipment Requiring Air Permits
7.3 Are air emissions from your operations monitored?
Yes [ ] No [X]
If so, indicate the frequency of monitoring and a description of the
monitoring results.
----------------------------------------------------------------------
7.4 Attach copies of any air emissions permits pertaining to your
operations on the premises.
8. HAZARDOUS MATERIALS DISCLOSURES
8.1 Does your company handle hazardous materials in a quantity equal to or
exceeding an aggregate of 500 pounds, 55 gallons, or 200 cubic feet?
Yes [ ] No [X]
8.2 Has your company prepared a hazardous materials management plan
("business plan") pursuant to Orange County Fire Department
requirements?
Yes [ ] No [X]
If so, attach a copy of the business plan.
8.3 Are any of the chemicals used in your operations regulated under
Proposition 65?
Yes [X] No [ ]
If so, describe the actions taken, or proposed actions to be taken, to
comply with Proposition 65 requirements.
Requested a copy of Prop. 65 with requirements for compliance.
8.4 Describe the procedures followed to comply with OSHA Hazard
Communication Standard requirements.
To be included in Injury & Illness Prevention Program.
9. ENFORCEMENT ACTIONS, COMPLAINTS
9.1 Has your company ever been subject to any agency enforcement actions,
administrative orders, or consent decrees?
Yes [ ] No [X]
It so, describe the actions and any continuing compliance obligations
imposed as a result of these actions.
----------------------------------------------------------------------
9.2 Has your company ever received requests for information, notice or
demand letters, or any other inquiries regarding its operations?
Yes [ ] No [X]
9.3 Have there ever been, or are there now pending, any lawsuits against
the company regarding any environmental or health and safety concerns?
Yes [ ] No [X]
9.4 Has an environmental audit ever been conducted at your company's
current facility?
Yes [ ] No [X]
If so, discuss the results of the audit.
----------------------------------------------------------------------
9.5 Have there been any problems or complaints from neighbors at the
company's current facility?
Yes [ ] No [X]
Kofax Image Products
------------------------------------------
Company
By: /s/ [SIG]
---------------------------------------
Title: Vice President
---------------------------------
Date: 9-6-91
----------------------------
3
<PAGE> 72
FOURTH AMENDMENT TO LEASE
I. PARTIES AND DATE.
This Fourth Amendment to Lease (the "Fourth Amendment") dated March 15,
1994, is by and between THE IRVINE COMPANY, a Michigan corporation ("Landlord"),
and KOFAX IMAGE PRODUCTS, a California corporation ("Tenant").
II. RECITALS.
Landlord and Tenant entered into a lease dated as of March 31, 1988, as
amended by First Amendment to Lease dated March 7, 1990, by Second Amendment to
Lease dated May 4, 1990 wherein an additional 5,735 square feet was added, and
by Third Amendment to Lease dated August 22, 1991 (the "Third Amendment"),
wherein an additional 7,705 square feet was added (as amended, the "Lease")
concerning certain premises ("Premises") located at 3 Jenner Street, Suites 100
and 150, Irvine, California.
Landlord and Tenant each desire to modify the Lease to add Suites 165 and
170 comprising 5,124 square feet of space in a building located at 5 Jenner
Street, Irvine, California, extend the Lease Term, adjust the Monthly Rent, and
make such other modifications as are set forth in "III. MODIFICATIONS" next
below. For purposes of this Fourth Amendment, the existing premises located at 3
Jenner Street shall be referred to as the "3 Jenner Premises" and the expansion
premises located at 5 Jenner Street shall be referred to as the "5 Jenner
Premises."
III. MODIFICATIONS.
A. Existing Lease Modifications. It is understood and agreed to by the
parties herein that the provisions of this Fourth Amendment shall supersede and
cancel in their entirety Section III, Paragraphs B, D, E, F and G of the Third
Amendment.
B. Building. Effective as of the "Commencement Date for the 5 Jenner
Premises" (as defined in the Work Letter attached hereto as Exhibit X), all
references to the "Building" in the Lease shall be amended to refer to the two
buildings located at 3 Jenner Street and 5 Jenner Street, Irvine, California,
either collectively or individually as the context may reasonably require.
C. Lease Summary. The Lease Summary is hereby amended as follows:
1. Subparagraph (c) is hereby deleted in its entirety and the
following shall be substituted in lieu thereof:
"(c) Address of Landlord: c/o The O'Donnell Group
One Technology Drive, Suite F-207
Irvine, CA 92718
Attn: Property Manager
2. Effective as of the Commencement Date for the 5 Jenner Premises,
Subparagraph (g) shall be deleted in its entirety and the following shall
be substituted in lieu thereof:
"(g) Premises Square Footage: Approximately 38,199 comprising
33,075 square feet at 3 Jenner Street and 5,124 square feet at 5
Jenner Street."
3. Effective as of the Commencement Date for the 5 Jenner Premises,
Subparagraph (h) shall be amended by adding the following:
"and 5 Jenner Street, Suites 165 and 170, Irvine, CA 92718"
1
<PAGE> 73
4. Effective as of the Commencement Date for the 5 Jenner Premises,
Subparagraph (i) shall be deleted in its entirety and the following shall
be substituted in lieu thereof:
"(i) 3 Jenner Building Square Footage: 33,075
5 Jenner Building Square Footage: 42,078"
5. Subparagraph (j) is hereby amended by adding the following:
"Anticipated Commencement Date for the 5 Jenner Premises: May 1,
1994."
6. Subparagraph (k) is hereby deleted in its entirety and the
following shall be substituted in lieu thereof:
"(k) Term: The Term of this Lease shall expire at midnight on
January 31, 1997."
7. Effective as of the Commencement Date for the 5 Jenner Premises,
Subparagraph (l) (and Exhibit "E" to the Lease) shall be deleted in their
entirety, and the following shall be substituted in lieu thereof:
"(l) Monthly Rent: $25,365.06 Adjustments to Monthly Rent:
Commencing on November 16, 1994, the Monthly Rent shall be $26,357.31"
8. Subparagraph (m) is hereby deleted and the following shall be
substituted in lieu thereof:
"(m) Security Deposit: $26,357.31"
9. Effective as of the Commencement Date for the 5 Jenner Premises,
Subparagraph (q) shall be deleted in its entirety and the following shall
be substituted in lieu thereof:
"(q) 26.33%"
D. Description of Premises. Effective as of the Commencement Date for the 5
Jenner Premises, Exhibit A to the Lease is deleted and is substituted by the
Revised Exhibit A attached to this Fourth Amendment.
E. Security Deposit. Concurrently with Tenant's delivery of this Fourth
Amendment, Tenant shall deliver the sum of Three Thousand Eight Hundred
Eighty-Three Dollars and Thirty-One Cents ($3,883.31) to Landlord, which sum
shall be added to the Security Deposit presently being held by Landlord in
accordance with Paragraph 7 of the Lease.
F. Option to Extend Term. Exhibit 5 to the Third Amendment entitled "Option
to Extend Term" shall remain in full force and effect (granting Tenant the right
to extend the Term beyond January 31, 1997 as therein provided), except that:
(i) the first sentence of Paragraph A.1. is hereby amended by deleting "three
(3) years and zero (0) months" as the "Extension" period and substituting "two
(2) years and zero (0) months" in lieu thereof; and (ii) the first sentence of
Paragraph B(ii) is hereby amended by deleting the interlineated text consisting
of the words "a lease of three (3) years with no options" and substituting "a
lease of two (2) years with no options" in lieu thereof.
G. Right to Terminate. Exhibit 4 to the Third Amendment entitled "Option to
Terminate Lease" is hereby canceled in its entirety. Landlord agrees that Tenant
shall have the following new right to terminate this Lease:
Right to Terminate. Provided no Event of Default has occurred and is
continuing, Tenant shall have a right to terminate the Lease effective as
of any date on or after January 31, 1996 by delivering not less than ninety
(90) days prior written notice of such termination to Landlord. All rental
and other costs due under the Lease shall be due and payable by Tenant to
Landlord through the effective date of any such
2
<PAGE> 74
termination. In addition, should Tenant exercise the foregoing right to
terminate, Tenant shall pay to Landlord, concurrently with its delivery of
the aforementioned 90-day termination notice, a separate termination fee
(the "Termination Fee"), as reasonably computed by Landlord, comprised of:
(1) the sum of Forty Thousand Dollars ($40,000.00), which sum shall be then
reduced ratably based on the number of months or fractions thereof
remaining in the Lease Term as of the effective date of termination; plus
(2) the unamortized portion of the $45,000.00 "Landlord's Contribution"
(amortized on a straight-line basis over a thirty-three (33) month period
with interest at the rate of ten percent (10%) per annum). The provisions
of this Section G shall not modify or impair those provisions of the Lease
which, by their terms, survive the expiration or other earlier termination
of the Lease. The right to terminated as herein provided is personal to
Tenant. If Tenant subleases more than fifty percent (50%) of the square
footage of the Premises or assigns or otherwise transfers any interest in
the Lease prior to its exercise of these termination rights, the rights
herein granted shall be void and of no further force or effect.
H. Parking. In accordance with the provisions of Rider No. 3 to the Lease,
"Parking," effective as of the Commencement Date for the 5 Jenner Premises,
Landlord shall provide Tenant's employees with an additional twenty-one (21)
unreserved parking spaces.
I. Signage. Landlord shall provide Tenant with a standard multi-tenant
identification sign for the 5 Jenner Premises.
J. Tenant Improvements. Landlord hereby agrees to complete the tenant
improvements set forth in Exhibit X, Work Letter, attached hereto.
K. Exhibit "3" Expiration. The parties hereby acknowledge and agree that
the Option to Lease Additional Vacant Space set forth in Exhibit "3" to the
Third Amendment has expired by its terms and is no longer of any force or
effect.
IV. GENERAL.
A. Effect of Amendments. The Lease shall remain in full force and effect
except to the extent that it is modified by this Amendment.
B. Entire Agreement. This Amendment embodies the entire understanding
between Landlord and Tenant with respect to the modifications set forth in "III.
MODIFICATIONS" above and can be changed only by a writing signed by Landlord and
Tenant.
C. Counterparts. If this Amendment is executed in counterparts, each is
hereby declared to be an original; all, however, shall constitute but one and
the same amendment. In any action or proceeding, any photographic, photostatic,
or other copy of this Amendment may be introduced into evidence without
foundation.
D. Defined Terms. All words commencing with initial capital letters in this
Amendment and defined in the Lease shall have the same meaning in this Amendment
as in the Lease, unless they are otherwise defined in this Amendment.
E. Corporate and Partnership Authority. If Tenant is a corporation or
partnership, or is comprised of either or both of them, each individual
executing this Amendment for the corporation or partnership represents that he
or she is duly authorized to execute and deliver this Amendment on behalf of the
corporation or partnership and that this Amendment is binding upon the
corporation or partnership in accordance with its terms.
F. Attorneys' Fees. The provisions of the Lease respecting payment of
attorneys' fees shall also apply to this Amendment.
3
<PAGE> 75
V. EXECUTION.
Landlord and Tenant executed this Amendment on the date as set forth in "I.
PARTIES AND DATE." above.
LANDLORD: TENANT:
THE IRVINE COMPANY, KOFAX IMAGE PRODUCTS,
a Michigan corporation a California corporation
By /s/ ROBERT E. WILLIAMS, JR. By /s/ [SIG]
---------------------------------- ------------------------------------
Robert E. Williams, Jr., President, Title President and CEO
Irvine Industrial Company, a division ---------------------------------
of The Company
By /s/ JOHN C. TSU By /s/ [SIG]
---------------------------------- ------------------------------------
John C. Tsu, Title Vice President and CFO
Assistant Secretary ---------------------------------
[SEAL] [SEAL]
4
<PAGE> 76
[MAP]
JENNER BUSINESS PARK
ORIENTATION SITE PLAN
REVISED EXHIBIT "A"
<PAGE> 77
EXHIBIT A
[ARCHITECTURE/SPACE PLANS]
1 of 3
<PAGE> 78
[ARCHITECTURE/SPACE PLANS]
2 of 3
<PAGE> 79
[ARCHITECTURE/SPACE PLANS]
3 of 3
<PAGE> 80
EXHIBIT X
WORK LETTER/BUILD TO SUIT
Landlord shall cause its contractor to construct the tenant improvements
for the 3 Jenner Premises and 5 Jenner Premises as shown in the space plan (the
"Plan") prepared by Donald Mueller Associates, dated February 24, 1994.
Landlord's total contribution for the tenant improvements, inclusive of space
planning costs shall not exceed Forty-Five Thousand Dollars ($45,000.00)
("Landlord's Contribution"), and any additional cost shall be borne solely by
Tenant and reimbursed to Landlord upon demand. Unless otherwise specified in the
Plan or hereafter agreed in writing by Landlord, all materials and finishes
utilized in constructing the tenant improvements shall be Landlord's building
standard. Should Landlord submit any additional plans, equipment specification
sheets, or other matters to Tenant for approval or completion, Tenant shall
respond in writing, as appropriate, within five (5) working days unless a
shorter period is provided herein. Tenant shall not unreasonably withhold its
approval of any matter, and any disapproval shall be limited to items not
previously approved by Tenant in the Plan or otherwise.
In the event that Tenant requests in writing a revision in the Plan or in
any other plans hereafter approved by Tenant, then provided such change request
is acceptable to Landlord, Landlord shall advise Tenant by written change order
of any additional cost and/or Tenant Delay (as defined below) such change would
cause. Tenant shall approve or disapprove such change order in writing within
two (2) days following its receipt: Tenant's approval of a change order shall
not be effective unless accompanied by payment in full of the additional cost of
the tenant improvement work resulting from the change order. It is understood
that Landlord shall have no obligation to interrupt or modify the tenant
improvement work pending Tenant's approval of a change order.
As used in the Fourth Amendment, the "Commencement Date for the 5 Jenner
Premises" shall mean the earlier of: (a) the date upon which all relevant
governmental authorities have approved the tenant improvements in the 5 Jenner
Premises in accordance with applicable building codes, as evidenced by written
approval thereof in accordance with the building permits issued therefor, or (b)
the date Tenant acquires possession or commences use of the 5 Jenner Premises
for any purpose other than construction; but in no event earlier than the
Anticipated Commencement Date for the 5 Jenner Premises as set fourth in the
fourth Amendment. Notwithstanding any provision in the Fourth Amendment to the
contrary, if Tenant fails to comply with any of the time periods specified in
this Work Letter, requests any changes to the work, furnishes inaccurate or
erroneous specifications or other information, or otherwise delays in any manner
the completion of the tenant improvements or the issuance of an occupancy
certificate (any of the foregoing being referred to in this Work Letter as a
"Tenant Delay"), then Tenant shall bear any resulting additional construction
cost or other expenses and the Commencement Date for the 5 Jenner Premises shall
be deemed to have occurred for all purposes, including Tenant's obligation to
pay rent, as of the date Landlord reasonably determines that it would have been
able to deliver the 5 Jenner Premises to Tenant but for the collective Tenant
Delays. In no event, however, shall such date be earlier than the Anticipated
Commencement Date for the 5 Jenner Premises as set forth in the Fourth
Amendment.
Landlord shall permit Tenant and its agents to enter the 5 Jenner Premises
prior to the Commencement Date for the 5 Jenner Premises in order that Tenant
may perform any work to be performed by Tenant hereunder through its own
contractors, subject to Landlord's prior written approval, and in a manner and
upon terms and conditions and at times satisfactory to Landlord's
representative. The foregoing License to enter the 5 Jenner Premises prior to
the Commencement Date for the 5 Jenner Premises is, however, conditioned upon
Tenant's contractors and their subcontractors and employees working in harmony
and not interfering with the work being performed by Landlord. If at any time
that entry shalt cause disharmony or interfere with the work being performed by
Landlord, this License may be withdrawn by Landlord upon twenty-four (24) hours
written notice to Tenant. That License is further conditioned upon the
compliance by Tenant's contractors with all requirements imposed by Landlord on
third party contractors, including without Limitation the maintenance by Tenant
and its contractors and subcontractors of workers' compensation and public
liability and property damage insurance in amounts and with companies and on
forms satisfactory to Landlord, with certificates of such insurance being
furnished to Landlord prior to proceeding with any such entry. The entry shall
be deemed to be under all of the provisions of the Lease except as to the
covenants to pay rent. Landlord shall not be Liable in any way for any injury,
loss or damage which may occur to any such work being performed by Tenant, the
same being solely at Tenant's risk. In no event shall the failure of Tenant's
contractors to complete any work in the 5 Jenner Premises extend the
Commencement Date for the 5 Jenner Premises beyond the date that Landlord has
completed its tenant improvement work and tendered the 5 Jenner Premises to
Tenant.
Tenant hereby designates Ron Fikert, Telephone No. (714) 727-1733, as its
representative, agent and attorney-in-fact for the purpose of receiving notices,
approving submittals and issuing requests for changes, and Landlord shall be
entitled to rely upon authorizations and directives of such person(s) as if
given by Tenant. Tenant may amend the designation of its construction
representative(s) at any time upon delivery of written notice to Landlord.
It is understood that a portion of the tenant improvements shall be done
during Tenant's occupancy of the 3 Jenner Premises. In this regard, Tenant
agrees to assume any risk of injury, loss or damage which may result. Tenant
further agrees that no rental abatement shall result while the tenant
improvements are completed in the 3 Jenner Premises.
EXHIBIT X
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<PAGE> 81
FIFTH AMENDMENT TO LEASE
I. PARTIES AND DATE.
This Fifth Amendment to Lease (the "Fifth Amendment") dated September
25, 1996, is by and between THE IRVINE COMPANY, a Michigan corporation
("Landlord"), and KOFAX IMAGE PRODUCTS, INC., a Delaware corporation as
successor-in-interest by corporate merger to Kofax Image Products, a California
corporation ("Tenant").
II. RECITALS.
Landlord and Tenant entered into a lease dated as of March 31, 1988 for
space located at 3 Jenner Street, Suite 100, Irvine, California ("Premises"),
which lease was amended by First Amendment to Lease dated March 7, 1990, by
Second Amendment to Lease dated May 4, 1990 wherein Suite 150 comprising 5,735
square feet was added, by Third Amendment to Lease dated August 22, 1991 (the
"Third Amendment") wherein an additional 7,705 square feet was added, and by a
Fourth Amendment to Lease dated March 15, 1994 (the "Fourth Amendment") wherein
Suites 165 and 170 comprising 5,124 rentable square feet in a building located
at 5 Jenner Street, Irvine, California was added (as amended, the "Lease").
Landlord and Tenant each desire to modify the Lease to add Suite 180
comprising 5,862 square feet of space in a building located at 5 Jenner Street,
Irvine, California, extend the Lease Term, adjust the Monthly Rent, and make
such other modifications as are set forth in "III. MODIFICATIONS" next below.
III. MODIFICATIONS.
A. Lease Summary. The Lease Summary is hereby amended as follows:
1. Effective as of the Commencement Date for Suite 180 (as
defined in the Work Letter attached hereto), Subparagraph (g)
shall be deleted in its entirety and the following shall be
substituted in lieu thereof:
"(g) Premises Square Footage: Approximately 44,061
comprising 33,075 square feet at 3 Jenner Street and 10,986
square feet at 5 Jenner Street."
2. Effective as of the Commencement Date for Suite 180,
Subparagraph (h) shall be amended by adding the following:
"and 5 Jenner Street, Suite 180, Irvine, CA 92718"
3. Subparagraph (j) is hereby amended by adding the following:
"Anticipated Commencement Date for Suite 180: December 1,
1996"
4. Subparagraph (k) is hereby deleted in its entirety and the
following shall be substituted in lieu thereof:
"(k) Term: The Term of this Lease shall expire at midnight
on January 31, 1999."
5. Effective as of the Commencement Date for Suite 180,
Subparagraph (l) shall be deleted in its entirety and the
following shall be substituted in lieu thereof:
"(l) Monthly Rent: $31,574.00
Adjustments to Monthly Rent:
Commencing on February 1, 1997, the Monthly Rent shall
be $39,214.00.
1
<PAGE> 82
Commencing on February 1, 1998 (the "Rental Adjustment
Date"), the Monthly Rent shall be increased by the
percentage increase, if any, in the United States
Department of Labor, Bureau of Labor Statistics,
Consumer Price Index for all Urban Consumers, Los
Angeles-Anaheim-Riverside Area Average, all items
(1982-84=100) (the "Index"). The adjustment shall be
calculated by comparing the Index published for the
third month preceding the Rental Adjustment Date with
the Index published for November, 1996, and the Monthly
Rent then in effect shall be increased by the amount of
the percentage increase, if any, between those
published Index amounts. In no event shall the Monthly
Rent be reduced by reason of such computation. If at
the Rental Adjustment Date the Index shall not exist,
Landlord may substitute another reasonable index
published by any governmental agency. Landlord shall
use diligent efforts to calculate and give Tenant
notice of any such increase in the Monthly Rent on or
near the Rental Adjustment Date, and Tenant shall
commence to pay the increased Monthly Rent effective on
the Rental Adjustment Date. In the event Landlord is
unable to deliver to Tenant the notice of the increased
Monthly Rent at least five (5) days prior to the Rental
Adjustment Date, Tenant shall commence to pay the
increased Monthly Rent on the first day of the month
following the delivery of such notice (the "Payment
Date"), provided Landlord's notice has been given at
least five (5) days in advance. Tenant shall also pay,
together with the first payment of the increased
Monthly Rent, an amount determined by multiplying the
amount of the increase in Monthly Rent times the number
of months that have elapsed between the Rental
Adjustment Date and the Payment Date."
6. Subparagraph (m) is hereby deleted and the following shall be
substituted in lieu thereof:
"(m) Security Deposit: $43,135.00"
7. Effective as of the Commencement Date for Suite 180,
Subparagraph (q) shall be deleted in its entirety and the
following shall be substituted in lieu thereof:
(q) 30.32%"
B. Description of Premises. Effective as of the Commencement Date for Suite
180, Exhibit A to this Fifth Amendment shall be added to Revised Exhibit A of
the Lease.
C. Security Deposit. Concurrently with Tenant's delivery of this Fifth
Amendment, Tenant shall deliver the sum of Sixteen Thousand Seven Hundred
Seventy-Seven Dollars and Sixty-Nine Cents ($16,777.69) to Landlord, which sum
shall be added to the Security Deposit presently being held by Landlord in
accordance with Paragraph 7 of the Lease.
D. Option to Extend Term. Exhibit 5 to the Third Amendment entitled "Option
to Extend Term" (as modified by Paragraph III(F) of the Fourth Amendment) is
hereby deleted in its entirety and nothing shall be substituted in lieu thereof.
E. Right to Terminate. Paragraph III(G) of the Fourth Amendment entitled
"Right to Terminate" is hereby deleted in its entirety and nothing shall be
substituted in lieu thereof.
F. Parking. Effective as of the Commencement Date for Suite 180, Lease
Rider No. 3, "Parking," Paragraph III(H) of the Fourth Amendment, and Paragraph
III(G) of the Third Amendment shall be deleted in their entirety and the
following shall be substituted in lieu thereof:
"During the period commencing as of the Commencement Date for Suite 180 and
ending January 31, 1999, Landlord shall provide Tenant with one hundred
fifty-four (154) unreserved parking spaces. Such parking rights shall be
subject to the provisions of Paragraph 40 of the Lease, shall be at no
additional charge to Tenant (subject to Tenant's obligations under
Paragraph 16 of the Lease), and shall be on a non-exclusive basis in common
with other tenants of the Project."
2
<PAGE> 83
G. Holding Over. The second sentence of Paragraph 8 of the Lease entitled
"Holding Over" is hereby amended by deleting the words "one hundred ten percent
(110%)" therefrom and substituting "one hundred fifty percent (150%)" in lieu
thereof.
H. Tenant Improvements. Landlord hereby agrees to complete the tenant
improvements for Suite 180 as set forth in Exhibit X, Work Letter, attached
hereto.
I. Contingency. Tenant understands and agrees that the effectiveness of
this Fifth Amendment is contingent upon the mutual execution and delivery of a
lease surrender and termination agreement between Landlord and Coram Healthcare,
the current tenant in possession of Suite 180.
IV. GENERAL.
A. Effect of Amendments. The Lease shall remain in full force and effect
except to the extent that it is modified by this Amendment.
B. Entire Agreement. This Amendment embodies the entire understanding
between Landlord and Tenant with respect to the modifications set forth in
"III. MODIFICATIONS" above and can be changed only by a writing signed by
Landlord and Tenant.
C. Counterparts. If this Amendment is executed in counterparts, each is
hereby declared to be an original; all, however, shall constitute but one and
the same amendment. In any action or proceeding, any photographic, photostatic,
or other copy of this Amendment may be introduced into evidence without
foundation.
D. Defined Terms. All words commencing with initial capital letters in this
Amendment and defined in the Lease shall have the same meaning in this Amendment
as in the Lease, unless they are otherwise defined in this Amendment.
E. Corporate and Partnership Authority. If Tenant is a corporation or
partnership, or is comprised of either or both of them, each individual
executing this Amendment for the corporation or partnership represents that he
or she is duly authorized to execute and deliver this Amendment on behalf of the
corporation or partnership and that this Amendment is binding upon the
corporation or partnership in accordance with its terms.
F. Attorneys' Fees. The provisions of the Lease respecting payment of
attorneys' fees shall also apply to this Amendment.
V. EXECUTION.
Landlord and Tenant executed this Amendment on the date as set forth in "I.
PARTIES AND DATE." above.
LANDLORD: TENANT:
THE IRVINE COMPANY, [SEAL] KOFAX IMAGE PRODUCTS, INC.,
a Michigan corporation a Delaware corporation
By /s/ CLARENCE W. BARKER By /s/ [SIG]
------------------------------------ --------------------------------
Clarence W. Barker, President, Title President and CEO
Irvine Industrial Company, a division
of The Irvine Company
By /s/ JOHN C. TSU By /s/ [SIG]
------------------------------------ --------------------------------
John C. Tsu, Title CFO and Secretary
Assistant Secretary
3
<PAGE> 84
[ARCHITECTURAL DRAWING]
3 JENNER
EXHIBIT A
Page 1 of 2
<PAGE> 85
[ARCHITECTURAL DRAWING]
5 JENNER
EXHIBIT A
Page 2 of 2
<PAGE> 86
[ARCHITECTURAL DRAWING]
5 JENNER
STE. 180
EXHIBIT A
<PAGE> 87
EXHIBIT X
WORK LETTER
Tenant Improvements for Suite 180
Landlord shall cause its contractor to construct such tenant improvement
work in Suite 180 as may be specified by Tenant not later than September 15,
1996, and approved by Landlord ("Tenant Improvements"). Landlord's total
contribution for the Tenant Improvements, inclusive of space planning costs and
Landlord's construction management fee, shall not exceed Twenty-Nine Thousand
Three Hundred Ten Dollars ($29,300.00) ("Landlord's Contribution"), and any
additional cost shall be borne solely by Tenant and reimbursed to Landlord upon
demand. Unless otherwise agreed in writing by Landlord, all materials and
finishes utilized in constructing the Tenant Improvements shall be Landlord's
building standard. Should Landlord submit any plans, equipment specification
sheets, or other matters to Tenant for approval or completion, Tenant shall
respond in writing, as appropriate, within five (5) working days unless a
shorter period is provided herein. Tenant shall not unreasonably withhold its
approval of any matter, and any disapproval shall be limited to items not
previously approved by Tenant.
In the event that Tenant requests in writing a revision in the Tenant
Improvements or in any work hereafter approved by Tenant, then provided such
change request is acceptable to Landlord, Landlord shall advise Tenant by
written change order of any additional cost and/or Tenant Delay (as defined
below) such change would cause. Tenant shall approve or disapprove such change
order in writing within two (2) days following its receipt. Tenant's approval of
a change order shall not be effective unless accompanied by payment in full of
the additional cost of the tenant improvement work resulting from the change
order. It is understood that Landlord shall have no obligation to interrupt or
modify the Tenant Improvements pending Tenant's approval of a change order.
As used in the Fifth Amendment, the "Commencement Date for Suite 180"
shall mean the earlier of: (a) the date upon which all relevant governmental
authorities have approved the Tenant Improvements in accordance with applicable
building codes, as evidenced by written approval thereof in accordance with the
building permits issued therefor, or (b) the date Tenant acquires possession or
commences use of Suite 180 for any purpose other than construction; but in no
event earlier than the Anticipated Commencement Date for Suite 180 as set forth
in the Fifth Amendment. Notwithstanding any provision In the Fifth Amendment to
the contrary, if Tenant fails to comply with any of the time periods specified
in this Work Letter, requests any changes to the work, furnishes inaccurate or
erroneous specifications or other information, or otherwise delays in any manner
the completion of the Tenant Improvements or the issuance of an occupancy
certificate (any of the foregoing being referred to in this Work Letter as a
"Tenant Delay"), then Tenant shall bear any resulting additional construction
cost or other expenses and the Commencement Date for Suite 180 shall be deemed
to have occurred for all purposes, including Tenant's obligation to pay rent, as
of the date Landlord reasonably determines that it would have been able to
deliver Suite 180 to Tenant but for the collective Tenant Delays.
Landlord shall permit Tenant and its agents to enter Suite 180 prior to
the Commencement Date for Suite 180 in order that Tenant may perform any work to
be performed by Tenant hereunder through its own contractors, subject to
Landlord's prior written approval, and in a manner and upon terms and conditions
and at times satisfactory to Landlord's representative. The foregoing license to
enter Suite 180 prior to the Commencement Date for Suite 180 is, however,
conditioned upon Tenant's contractors and their subcontractors and employees
working in harmony and not interfering with the work being performed by
Landlord. If at any time that entry shall cause disharmony or interfere with the
work being performed by Landlord, this license may be withdrawn by Landlord upon
twenty-four (24) hours written notice to Tenant. That license is further
conditioned upon the compliance by Tenant's contractors with all requirements
imposed by Landlord on third party contractors, including without limitation the
maintenance by Tenant and its contractors and subcontractors of workers'
compensation and public liability and property damage insurance in amounts and
with companies and on forms satisfactory to Landlord, with certificates of such
insurance being furnished to Landlord prior to proceeding with any such entry.
The entry shall be deemed to be under all of the provisions of the Lease except
as to the covenants to pay rent. Landlord shall not be liable in any way for any
injury, loss or damage which may occur to any such work being performed by
Tenant, the same being solely at Tenant's risk. In no event shall the failure of
Tenant's contractors to complete any work in Suite 180 extend the Commencement
Date for Suite 180 beyond the date that Landlord has completed the Tenant
Improvements and tendered Suite 180 to Tenant.
Tenant hereby designates Ron Fikert, Telephone No. (714) 727-1733, as
its representative, agent and attorney-in-fact for the purpose of receiving
notices, approving submittals and issuing requests for changes, and Landlord
shall be entitled to rely upon authorizations and directives of such person(s)
as if given by Tenant. Tenant may amend the designation of its construction
representative(s) at any time upon delivery of written notice to Landlord.
EXHIBIT X
- 1 -