California-Carpinteria-6430 Via Real Lease - South Coast Business Park and ValueClick Inc.
STANDARD INDUSTRIAL LEASE - MULTI-TENANT
AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION
1. PARTIES. This Lease, dated, for reference purpose only, AUGUST 30, 1999,
is made by and between WILLIAM D & EDNA J. WRIGHT DBA SOUTH COAST
BUSINESS PARK (herein called "Lessor") and VALUECLICK, INC., A DELAWARE
CORPORATION (herein called "Lessee").
2. PREMISES, PARKING AND COMMON AREAS.
2.1 PREMISES. Lessor hereby Leases to Lessee and leases from Lessor for the
term, at the rental, and upon all of the conditions set forth herein,
real property situated in the County of SANTA BARBARA, State of
CALIFORNIA commonly known as SOUTH COAST BUSINESS PARK, PHASE I & II
(46,198 + 14,000 = 60,198 S.F.) and described as 6430 VIA REAL, (BUILDING
C), SUITE'S 1 & 2, CARPINTERIA, CA, CONSISTING OF APPROXIMATELY 2,750
SQUARE FEET (SEE EXHIBIT "A") herein referred to as the "Premises", as
may be outlined on an Exhibit attached hereto, including rights to the
Common Areas as hereinafter specified but not including any rights to the
roof of the Premises or to any Building in the Industrial Center. The
Premises are a portion of a building herein referred to as the
"Building." The Premises, the Building, the Common Areas, the land upon
which the same are located, along with all other buildings and
improvements thereon, are herein collectively referred to as the
"Industrial Center."
2.2 VEHICLE PARKING. Lessee shall be entitled to 9 vehicle parking
spaces, unreserved and unassigned, on those portions of the Common Areas
designated by Lessor for parking. Lessee shall not use more parking
spaces than said number. Said parking spaces shall be used only for
parking by vehicles no larger than full size passenger automobiles or
pick-up trucks, herein called "Permitted Size Vehicles." Vehicles other
than Permitted Size Vehicles are herein referred to as "Oversized
Vehicles."
2.2.1 Lessee shall not permit or allow any vehicles that belong to or
are controlled by Lessee or Lessee's employees, suppliers,
shippers, customer, or invitees to be loaded, unloaded, or parked
in areas other than those designated by Lessor for such
activities.
2.2.2 If Lessee permits or allows any of the prohibited activities
described in paragraph 2.2 of this Lease, then Lessor shall have
the right, without notice, in addition to such other rights and
remedies that it may have, to remove or tow away the vehicle
involved and charge the cost to Lessee, which cost shall be
immediately payable upon demand by Lessor.
2.3 COMMON AREAS - DEFINITION. The term "Common Areas" is defined as all
areas and facilities outside the Premises and within the exterior
boundary line of the Industrial Center that are provided and designated
by the Lessor from time to time for the general non-exclusive use of
Lessor, Lessee and of other lessees of the Industrial Center and their
respective employees, suppliers, shippers, customers and invitees,
including parking areas, loading and unloading areas, trash areas,
roadways, sidewalks, walkways, parkways, driveways and landscaped areas.
2.4 COMMON AREAS - LESSEE'S RIGHTS. Lessor hereby grants to Lessee, for the
benefit of Lessee and its employees, suppliers, shippers, customers and
invitees, during the term of this Lease, the non-exclusive right to use,
in common with other entitled to such use, the Common Areas as they exist
from time to time, subject to any rights, powers, and privileges reserved
by Lessor under the terms hereof or under the terms of any rules and
regulations or restrictions governing the use of the Industrial Center.
Under no circumstances shall the right herein granted to use the Common
Areas be deemed to include the right to store any property, temporarily
or permanently, in the Common Areas. Any such storage shall be permitted
only by the prior written consent of Lessor or Lessor's designated agent,
which consent may be revoked at any time. In the event that any
unauthorized
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storage shall occur then Lessor shall have the right,
without notice, in addition to such other rights and remedies that it may
have, to remove the property and charge the cost to Lessee, which cost
shall be immediately payable upon demand by Lessor.
2.5 COMMON AREAS - RULES AND REGULATIONS. Lessor or such other person(s) as
Lessor may appoint shall have the exclusive control and management of the
Common Areas and shall have the right, from time to time, to establish,
modify, amend and enforce reasonable rules and regulations with respect
thereto. Lessee agrees to abide by and conform to all such rules and
regulations, and to cause its employees, suppliers, shippers, customers,
and invitees to so abide and conform. Lessor shall not be responsible to
Lessee for the non-compliance with said rules and regulations by other
lessees of the Industrial Center.
2.6 COMMON AREAS - CHANGES. Lessor shall have the right, in Lessor's sole
discretion, from time to time:
(a) To make changes to the Common Areas, including, without limitation,
changes in the location, size, shape and number of driveways, entrance,
parking spaces, parking areas, loading and unloading areas, ingress,
egress, direction of traffic, landscaped areas and walkways; (b) To
close temporarily any of the Common Areas for maintenance purposes so
long as reasonable access to the Premises remains available; (c) To
designate other land outside the boundaries of the Industrial Center to
be a part of the Common Areas; (d) To add additional buildings and
improvements to the Common Areas; (e) To use the Common Areas while
engaged in making additional improvements, repairs or alterations to the
Industrial Center, or any portion thereof; (f) To do and perform such
other acts and make such other changes in, to or with respect to the
Common Areas and Industrial Center as Lessor may, in the exercise of
sound business judgement, deem to be appropriate.
2.6.1 Lessor shall at all times provide the parking facilities required
by applicable law and in no event shall the number of parking spaces that
Lessee is entitled to under paragraph 2.2 be reduced.
3. TERM.
3.1 TERM. The term of this Leases shall be for APPROXIMATELY 3 YEARS
commencing on OCTOBER 1, 1999 and ending on SEPTEMBER 30, 2002 unless
sooner terminated pursuant to any provision hereof. See Addendum.
3.2 DELAY IN POSSESSION. Notwithstanding said commencement date, if for any
reason Lessor cannot deliver possession of the Premises to Lessee on said
date, Lessor shall not be subject to any liability therefor, nor shall
such failure affect the validity of this Lease or the obligations of
Lessee hereunder or extend the term hereof, but in such case, Lessee
shall not be obligated to pay rent or perform any other obligation of
Lessee under the terms of this Lease, except as may be otherwise provided
in this Lease, until possession of the Premises is tendered to Lessee.
3.3 EARLY POSSESSION. If Lessee occupies the Premises prior to said
commencement date, such occupancy shall be subject to all provisions of
this Lease, such occupancy shall not advance the termination date, and
Lessee shall pay rent for such period at the initial monthly rates set
forth below.
4. RENT.
4.1 BASE RENT. Lessee shall pay to Lessor, as Base Rent for the Premises,
without any offset or deduction, except as may be otherwise expressly
provided in this Lease, on the 1ST day of each month of the term hereof,
monthly payments in advance of $3,575.00 SEE ADDENDUM FOR COST OF LIVING
ADJUSTMENTS TO BASE RENT, AND DETERMINATION OF RENT DURING EXTENSION
PERIODS. Lessee shall pay Lessor upon the execution hereof $3,575.00 as
Base Rent for 10/1/99 - 11/1/99. Rent for any
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period during the term hereof which is for less than one month shall be a
pro rata portion of the Base Rent. Rent shall be payable in lawful money
of the United Sates to Lessor at the address stated herein or to such
other persons or at such other places as Lessor may designate in writing.
4.2 OPERATING EXPENSES. Lessee shall pay to Lessor during the term hereof,
in addition to the Base Rent, Lessee's Share, as hereinafter defined, of
all Operating Expenses, as hereinafter defined, during each calendar year
of the term of this Lease, in accordance with the following provisions:
(a) "Lessee's Share" is defined, for purpose of this Lease as 4.56
percent.
(b) "Operating Expenses" is defined, for purposes of this Lease, as
all costs incurred by Lessor, if any, for:
(i) The operation, repair and maintenance, in neat, clean, good
order arid condition, of the following:
(aa) The Common Areas, including parking areas, loading
and unloading areas, trash areas, roadways,
sidewalks, walkways, parkways, driveways, landscaped
areas, striping, bumpers, irrigation systems, Common
Area lighting facilities and fences and gates;
(bb) Trash disposal services;
(cc) Tenant directories;
(dd) Fire detection systems including sprinkler system
maintenance and repair;
(ee) Security services;
(ff) Any other service to be provided by Lessor that is
elsewhere in this Lease stated to be an "Operating
Expense;"
(gg) Property management expenses;
(ii) Any deductible portion of an insured loss concerning any of
the items or matters described in this paragraph 4.2;
(iii) The cost of the premiums for the liability and property
insurance policies to be maintained by Lessor under
paragraph 8 hereof;
(iv) The amount of the real property tax to be paid by Lessor
under paragraph 10.1 hereof;
(v) The cost of water, gas and electricity to service the
Common Areas.
(c) The inclusion of the improvement, facilities and services set
forth in paragraph 4.2 (b)(i) of the definition of Operating
Expenses shall not be deemed to impose an obligation upon Lessor
to either have said improvements or facilities or to provide those
services unless the Industrial Center already has the same, Lessor
already provides the services, or Lessor has agreed elsewhere in
this Lease to provide the same or some of them.
(d) Lessee's Share of Operating Expenses shall be payable by Lessee
within ten (10) days after a reasonably detailed statement of
actual expenses is presented to Lessee by Lessor. At lessor's
option, however, an amount may be estimated by Lessor from time to
time of Lessee's Share of annual Operating Expenses and the same
shall be payable monthly or quarterly, as Lessor shall designate,
during each twelve-month period of the Lease term, on the same day
as the Base Rent is due hereunder. In the event that Lessee pays
Lessor's estimate of Lessee's Share of Operating Expenses as
aforesaid, Lessor shall deliver to Lessee within sixty (60) days
after the expiration of each calendar year a reasonably detailed
statement showing Lessee's Share of the actual Operating Expenses
incurred during the preceding year. If Lessee's payments under
this paragraph 4.2(d) during said preceding year exceed Lessee's
Share as indicated on said statement, Lessee shall be entitled to
credit the amount of such overpayment against Lessee's Share of
Operating Expenses next falling due. If Lessee's payments under
this paragraph during said preceding year were less than Lessee's
Share as indicated on said statement, Lessee shall pay to Lessor
the amount of the deficiency within ten (10) days after delivery
by Lessor to Lessee of said statement.
5. SECURITY DEPOSIT. Lessee shall deposit with Lessor upon execution hereof
$3,575.00 as security for Lessee's faithful performance of Lessee's
obligations hereunder. If Lessee fails to pay rent or other charges due
hereunder, or otherwise defaults with respect to any provision of this
Lease. Lessor may use, apply or retain all or any portion of said
deposit for the payment of any rent or other charge in default or for the
payment of any other sum to which Lessor may become
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obligated by reason of Lessee's default, or to compensate Lessor for any
loss or damage which Lessor may suffer thereby. If Lessor so uses or
applies all or any portion of said deposit. Lessee shall within
ten (10) days after written demand therefor deposit cash with Lessor in
an amount sufficient to restore said deposit to the full amount then
required of Lessee. If the monthly rent shall from time to time,
increase during the term of this Lease, Lessee shall, at the time of such
increase, deposit with Lessor additional money as a security deposit so
that the total amount of the security deposit held by Lessor shall at all
times bear the same proportion to the then current Base Rent as the
initial security deposit bears to the initial Base Rent set forth in
paragraph 4. Lessor shall not be required to keep said security deposit
separate from its general accounts. If Lessee performs all of Lessee's
obligations hereunder, said deposit, or so much thereof as has not
theretofore been applied by Lessor, shall be returned, without payment of
interest or other increment for its use, to Lessee (or, at Lessor's
option, to the last assignee, if any, of Lessee's interest hereunder) at
the expiration of the term hereof, and after Lessee has vacated the
Premises. No trust relationship is created herein between Lessor and
Lessee with respect to said Security Deposit.
6. USE.
6.1 USE. The Premises shall be used and occupied only for GENERAL OFFICE
USE AND FOR NO OTHER USE WITHOUT LESSOR'S PRIOR written consent. See
Addendum for additional terms.
6.2 COMPLIANCE WITH LAW.
(a) Lessor warrants to Lessee that the Premises, in the state existing
on the date that the Lease term commences, but without regard to
the use for which Lessee will occupy the Premises, does not
violate any covenants or restrictions of record, or any applicable
building code, regulation or ordinance in effect on such Lease
term commencement date. In the event it is determined that this
warranty has been violated, then it shall be the obligation of the
Lessor, after written notice from Lessee, to promptly, at Lessor's
sole cost an expense, rectify any such violation. In the event
Lessee does not give to Lessor written notice of the violation of
this warranty within six months from the date that the Lease term
commences, the correction of same shall be the obligation of the
Lessee at Lessee's sole cost. The warranty contained in this
paragraph 6.2(a) shall be of no force or effect if, prior to the
date of this Lease, Lessee was an owner or occupant of the
Premises and, in such event, Lessee shall correct any such
violation at Lessee's sole cost.
(b) Except as provided in paragraph 6.2(a) Lessee shall, at Lessee's
expense, promptly comply with all applicable statutes, ordinances,
rules, regulations, orders, covenants and restrictions of record,
and requirements of any fire insurance underwriters or rating
bureaus, now in effect or which may hereafter come into effect,
whether or not they reflect a change in policy from that now
existing, during the term or any part of the term or which may
hereafter come into effect, whether or not they reflect a change
in policy from that now existing, during the term or any part of
the term hereof, relating in any manner to the Premises and the
occupation and use by Lessee of the Premises and of the Common
Areas. Lessee shall not use nor permit the use of the Premises or
the Common Areas in any manner that will tend to create waste or a
nuisance or shall tend to disturb other occupants of the
Industrial Center.
6.3 CONDITION OF PREMISES
(a) Lessor shall deliver the Premises to Lessee clean and free of
debris on the Lease commencement date (unless Lessee is already in
possession) and Lessor warrants to Lessee that the plumbing,
lighting, air conditioning, heating, and loading doors in the
Premises shall be in good operating condition on the Lease
commencement date. In the event that it is determined that this
warranty has been violated, then it shall be the obligation of
Lessor, after receipt of written notice from Lessee setting forth
with specificity the nature of the violation, to promptly, at
Lessor's sole cost, rectify such violation. Lessee's failure to
give such written
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notice to Lessors within thirty (30) days after the Lease
commencement date shall cause the conclusive presumption
that Lessor has complied with all of Lessor's obligations
hereunder. The warranty contained in this paragraph 6.3(a) shall
be of no force or effect if prior to the date of this Lease,
Lessee was an owner or occupant of the Premises. See Addendum.
(b) Except as otherwise provided in this Lease, Lessee hereby accepts
the Premises in their condition existing as of the Lease
commencement date or the date that Lessee takes possession of the
Premises, whichever is earlier, subject to all applicable zoning,
municipal, county and state laws, ordinances and regulations
governing and regulating the use of the Premises, and any
covenants or restrictions of record, and accepts this Lease
subject thereto and to all matters disclosed thereby and by any
exhibits attached hereto. Lessee acknowledges that neither Lessor
nor Lessor's agent has made any representation or warranty as to
the present or future suitability of the Premises for the conduct
of Lessee's business.
7. MAINTENANCE, REPAIRS, ALTERATIONS AND COMMON AREA SERVICES.
7.1 LESSOR'S OBLIGATIONS. Subject to the provisions of Paragraphs 4.2
(Operating Expenses). 6 (Use), 7.2 (Lessee's Obligations) and 9 (Damage
or Destruction) and except for damage caused by any negligent or
intentional act or omission of Lessee, Lessee's employees, suppliers,
shippers, customers, or invitees, in which event Lessee shall repair the
damage, Lessor, at Lessor's expense, subject to reimbursement pursuant to
paragraph 4.2 shall keep in good condition and repair the foundations,
exterior walls, structural condition of interior bearing walls, and roof
of the Premises, as well as the parking lots, walkways, driveways,
landscaping, fences, signs and utility installations of the Common Areas
and all parts thereof, as well as providing the services for which there
is an Operating expense pursuant to paragraph 4.2. Lessor shall not,
however, be obligated to paint the exterior or interior surface of
exterior walls, nor shall Lessor be required to maintain, repair or
replace windows, doors or plate glass of the Premises. Lessor shall have
no obligation to make repairs under this paragraph 7.1 until a reasonable
time after receipt of written notice from Lessee of the need for such
repairs. Lessee expressly waives the benefits of any statute now or
hereafter in effect which would otherwise afford Lessee the right to make
repairs at Lessor's expense or to terminate this Lease because of
Lessor's failure to keep the Premises in good order, condition and
repair. Lessor shall not be liable for damages or loss of any kind or
nature by reason of Lessor's failure to furnish any Common Area Services
when such failure is caused by accident, breakage, repairs, strikes,
lockout, or other labor disturbances or disputes of any character, or by
any other cause beyond the reasonable control of Lessor.
7.2 LESSEE'S OBLIGATIONS.
(a) Subject to the provisions of paragraphs 6 (Use), 7.1 (Lessor's
Obligations), and 9 (Damage or Destruction), Lessee, at Lessee's
expense, shall keep in good order, condition and repair the
Premises and every part thereof (whether or not the damaged
portion of the Premises of the means of repairing the same are
reasonably or readily accessable to Lessee) including, without
limiting the generality of the foregoing, all plumbing, heating,
ventilating and air conditioning systems (Lessee shall procure and
maintain, at Lessee's expense, a ventilating and air conditioning
system maintenance contract), electrical and lighting facilities
and equipment within the Premises, fixtures, interior walls and
interior surfaces of exterior walls, ceilings, windows, doors,
plate glass, and skylights located within the Premises. Lessor
reserves the right to procure and maintain the ventilating and air
conditioning system maintenance contract and if Lessor so elects,
Lessee shall reimburse Lessor, upon demand, for the cost thereof.
Lessee shall be responsible for clean-up of all hazardous waste
occurring in or about the Premises.
(b) If Lessee fails to perform Lessee's obligations under this
paragraph 7.2 or under any other paragraph of this Lease, Lessor
may enter upon the Premises after ten (10) days'
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prior written notice to Lessee (except in the case of emergency,
in which no notice shall be required), perform such obligations
on Lessee's behalf and put the Premises in good order, condition
and repair, and the cost thereof together with interest thereon at
the maximum rate then allowable by law shall be due and payable as
additional rent to Lessor together with Lessee's next Base Rent
installment.
(c) On the last day of the term hereof, or on any sooner termination,
Lessee shall surrender the Premises to Lessor in the same
condition as received, ordinary wear and tear excepted, clean and
free of debris. Any damage or deterioration of the Premises shall
not be deemed ordinary wear and tear if the same could have been
prevented by good maintenance practices. Lessee shall repair any
damage to the Premises occasioned by the installation or removal
of Lessee's trade fixtures, alterations, furnishings and
equipment. Notwithstanding anything to the contrary otherwise
stated in this Lease, Lessee shall leave the air lines, power
panels, electrical distribution systems, lighting fixtures, space
heaters, air conditioning, plumbing and fencing on the Premises in
good operating condition.
7.3 ALTERATIONS AND ADDITIONS.
(a) Lessee shall not, without Lessor's prior written consent make any
alteration, improvement, additions, or Utility Installations in,
on or about the premises, or the Industrial Center, except for
nonstructural alterations to the Premises not exceeding $2,500 in
cumulative costs, during the term of this Lease. In any event,
whether or not in excess of $2,500 in cumulative cost, Lessee
shall make no change or alteration to the exterior of the Premises
nor the exterior of the Building not the Industrial Center without
Lessor's prior written consent. As used in this paragraph 7.3 the
term "Utility Installation" shall mean carpeting, window
coverings, air lines, power panels, electrical distribution
systems, lighting fixtures, space heaters, air conditioning,
plumbing, and fencing. Lessor may require that Lessee remove any
or all of said alterations, improvements, additions or Utility
Installations at the expiration of the term, and restore the
Premises and the Industrial Center to their prior condition.
Lessor may require Lessee to provide Lessor, at Lessee's sole cost
and expense, a lien and completion bond in an amount equal to one
and one-half times the estimated cost of such improvements, to
inure Lessor against any liability for mechanic's and
materialmen's liens and to insure completion of the work. Should
Lessee make any alterations, improvements, additions or Utility
Installations without the prior approval of Lessor, Lessor may, at
any time during the term of this Lease, require that Lessee remove
any or all of the same.
(b) Any alterations, improvement, additions or Utility Installations
in or about the Premises or the Industrial Center that Lessee
shall desire to make and which requires the consent of the Lessor
shall be presented to Lessor in written form, with proposed
detailed plans. If Lessor shall give its consent, the consent
shall be deemed conditioned upon Lessee acquiring a permit to do
so from appropriate governmental agencies, the furnishing of a
copy thereof to Lessor prior to the commencement of the work and
the compliance by Lessee of all conditions of said permit in a
prompt and expeditious manner.
(c) Lessee shall pay, when due, all claims for labor or materials
furnished or alleged to have been furnished to or for Lessee at or
for use in the Premises, which claims are or may be secured by any
mechanic's or materialmen's lien against the Premises, or the
Industrial Center, or any interest therein. Lessee shall give
Lessor not less than ten (10) days' notice prior to the
commencement of any work in the Premises, and Lessor shall have
the right to post notices of non-responsibility in or on the
Premises or the Building as provided by law. If Lessee shall, in
good faith contest the validity of any such lien, claim or demand,
then Lessee shall, at its sole expense defend itself and Lessor
against the same and shall pay and satisfy any such adverse
judgement that may be rendered thereon before the enforcement
thereof against the Lessor or the Premises or the Industrial
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Center, upon the condition that if Lessor shall require, Lessee
shall furnish to Lessor a surety bond satisfactory to Lessor in an
amount equal to such contested lien claim or demand indemnifying
Lessor against liability for the same and holding the Premises and
the Industrial Center free from the effect of such lien or claim.
In addition, Lessor may require Lessee to pay Lessor's attorneys
fees and costs in participating in such action if Lessor shall
decide it is to Lessor's best interest to do so.
(d) All alterations, improvements, additions and Utility Installations
(whether or not such Utility Installations constitute trade
fixtures of Lessee), which may be made on the Premises, shall be
the property of Lessor and shall remain upon and be surrendered
with the Premises at the expiration of the Lease term, unless
Lessor requires their removal pursuant to paragraph 7.3(a).
Notwithstanding the provisions of this paragraph 7.3(d). Lessee's
machinery and equipment, other than that which is affixed to the
Premises so that it cannot be removed without material damaged to
the Premises, and other than Utility Installations, shall remain
the property of Lessee and may be removed by Lessee subject to the
provision of paragraph 7.2.
7.4 UTILITY ADDITIONS. Lessor reserves the right to install new or
additional utility facilities throughout the Building and the Common
Areas for the benefit of Lessor or Lessee, or any other lessee of the
Industrial Center, including, but not by way of limitation, such
utilities as plumbing, electrical systems, security systems,
communication system, and fire protection and detection systems, so long
as such installations do not unreasonably interfere with Lessee's use of
the Premises.
8. INSURANCE; INDEMNITY.
8.1 LIABILITY INSURANCE - LESSEE.
See page 8 after article number 49
8.2 LIABILITY INSURANCE - LESSOR. Lessor shall obtain and keep in force
during the term of this Lease a policy of Combined Single Limit Bodily
Injury and Property Damage Insurance, inuring Lessor, but not Lessee,
against any liability arising out of the ownership, use occupancy or
maintenance of the Industrial Center in an amount not less than
$1,000,000 per occurrence.
8.3 PROPERTY INSURANCE. Lessor shall obtain and keep in force during the
term of this Lease a policy or policies of insurance coving loss or
damage to the industrial Center improvements, but not Lessee's personal
property, fixtures, equipment or tenant improvement, in an amount not to
exceed the full replacement value thereof, as the same may exist from
time to time, providing protection against all perils including within
the classification of fire, extended coverage, vandalism, malicious
mischief, flood (in the event same is required by a lender having a lien
on the Premises) special extended perils ("all risk", as such term is
used in the insurance industry), plate glass insurance and such other
insurance as Lessor deems advisable. In addition, Lessor shall obtain
and keep in force, during the term of this Lease, a policy of rental
value insurance covering a period of one year, with loss payable to
Lessor, which insurance shall also cover all Operating expenses for said
period. In the event that the Premises shall suffer an insured loss as
defined in paragraph 9.1(g) hereof, the deductible amounts under the
casualty insurance policies relating to the Premises shall be paid by
Lessee.
8.4 PAYMENT OF PREMIUM INCREASE.
(a) After the term of this Lease has commenced, Lessee shall not be
responsible for paying Lessee's Share of any increase in the
property insurance premium for the Industrial Center specified by
Lessor's Insurance carrier as being caused by the use, acts or
omissions of any other lessee of the Industrial Center, or by the
nature of such other lessee's occupancy which create an
extraordinary or unusual risk.
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(b) Lessee, however, shall pay the entirety of any increase in the
property insurance premium for the Industrial Center over what is
was immediately prior to the commencement of the term of this
Lease if the increase is specified by Lessor's insurance carrier
as being caused by the nature of Lessee's occupancy or any act of
omission of Lessee.
8.5 INSURANCE POLICIES. Insurance required hereunder shall be in companies
holding a "General Policyholders Rating" of at least B plus, or such
other rating as may be required by a lender having a lien on the
Premises, as set forth in the most current issue of "Best's Insurance
Guide." Lessee shall not do or permit to be done anything which shall
invalidate the insurance policies carried by Lessor. Lessee shall
deliver to Lessor copies of liability insurance policies required under
paragraph 8.1 or certificates evidencing the existence and amounts of
such insurance within seven (7) days after the commencement date of this
Lease. No such policy shall be cancellable or subject to reduction of
coverage or other modification except after thirty (30) days prior
written notice to Lessor. Lessee shall, at least thirty (30) days prior
to the expiration of such policies, furnish Lessor with renewals or
"binders" thereof.
8.6 WAIVER OF SUBROGATION. Lessee and Lessor each hereby release and relieve
the other, and waive their entire right of recovery against the other for
loss or damage arising out of or incident to the perils insured against
which perils occur in, on or about the Premises, whether due to the
negligence of Lessor or Lessee or their agents, employees, contractors
and/or invitees. Lessee and Lessor shall, upon obtaining the policies of
insurance required give notice to the insurance carrier or carriers that
the foregoing mutual waiver of subrogation is contained in this Lease.
8.7 INDEMNITY. Lessee shall indemnify and hold harmless Lessor from and
against any and all claims arising from Lessee's use of the Industrial
Center, or from the conduct of Lessee's business or from any activity,
work or things done, permitted or suffered by Lessee in or about the
Premises or elsewhere and shall further indemnify and hold harmless
Lessor from and against any and all claims arising from any breach or
default in the performance of any obligation on Lessee's part to be
performed under the terms of this Lease, or arising from any act or
omission of Lessee, or any of Lessee's agents, contractors, or
employees, and from and against all costs, attorney's fee, expenses and
liabilities incurred in the defense of any such claim or any action or
proceeding brought thereon and in case any action or proceeding be
brought against Lessor by reason of any such claim. Lessee upon notice
from Lessor shall defend the same at Lessee's expense by counsel
reasonably satisfactory to Lessor and Lessor shall cooperate with Lessee
in such defense. Lessee, as a material part of the consideration to
Lessor, hereby assumes all risk of damage to property of Lessee or injury
to persons, in upon or about the Industrial Center arising from any cause
and Lessee hereby waives all claims in respect thereof against Lessor.
See Addendum.
8.8 EXEMPTION OF LESSOR FROM LIABILITY. Lessee hereby agrees that Lessor
shall not be liable for injury to Lessee's business or any loss of
income therefrom or for damage to the goods, wares, merchandise or other
property of Lessee, Lessee's employees, invitees, customers, or nay other
person in or about the Premises or the Industrial Center, nor shall
Lessor be liable for injury to the person of Lessee, Lessee's employees,
agents or contractors, whether such damage or injury is caused by or
results from fire, steam, electricity, gas water or rain, or from the
breakage, leakage, obstruction or other defects of pipes, sprinklers,
wires, appliances, plumbing, air conditioning or lighting fixtures, or
from any other cause, whether said damage or injury results from
conditions arising upon the Premises or upon other portions of the
Industrial Center, or from other sources or places and regardless of
whether the cause of such damage or injury or the means of repairing the
same is inaccessible to Lessee. Lessor shall not be liable for any
damages arising from any act or neglect of any other lessee, occupant or
user of the Industrial Center, nor from the failure of Lessor to enforce
the provisions of any other lease of the Industrial Center.
9. DAMAGE OR DESTRUCTION.
9.1 DEFINITIONS
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(a) "Premises Partial Damage" shall mean if the Premises are damaged
or destroyed to the extent that the cost of repair is less than
fifty percent of he then replacement cost of the Premises.
(b) "Premises Total Destruction" shall mean if the Premises are
damaged or destroyed to the extend that the cost of repair is
fifty percent or more of the then replacement cost of the
Premises.
(c) "Premises Building Partial Damage" shall mean if the Building of
which the Premises are a part is damaged or destroyed to the
extent that the cost to repair is less than fifty percent of the
then replacement cost of the Building.
(d) "Premises Building Total Destruction" shall mean if the Building
of which the Premises are a part is damaged or destroyed to the
extent that the cost to repair is fifty percent or more of the
then replacement cost of the Building.
(e) "Industrial Center Buildings" shall mean all of the buildings on
the Industrial Center site.
(f) "Industrial Center Buildings Total Destruction" shall mean if the
Industrial Center Buildings are damaged or destroyed to the extent
that the cost of repair is fifty percent or more of the then
replacement cost of the Industrial Center Buildings.
(g) "Insured Loss" shall mean damage or destruction which was covered
by an event required to be covered by the insurance described in
paragraph 8. The fact that an insured Loss has a deductible
amount shall not make the loss an uninsured loss.
(h) "Replacement Cost" shall mean the amount of money necessary to be
spent in order to repair or rebuild the damaged area to the
condition that existed immediately prior to the damaged occurring
excluding all improvements made by lessees.
9.2 PREMISES PARTIAL DAMAGE; PREMISES BUILDING PARTIAL DAMAGE.
(a) Insured Loss: Subject to the provisions of paragraphs 9.4 and
9.5, if at any time during the term of this Lease there is damage
which is an Insured Loss and which falls into the classification
of either Premises Partial Damage or Premises Building Partial
Damage then Lessor shall, at Lessor's expense, repair such damage
to the Premises, but not Lessee's fixtures, equipment or tenant
improvements, as soon as reasonably possible and this Lease shall
continue in full force and effect.
(b) Uninsured Loss: Subject to the provisions of paragraph 9.4 and
9.5, if at any time during the term of this Lease there is damage
which is not an Insured Loss and which falls within the
classification of Premises Partial Damage or Premises Building
Partial Damage, unless caused by a negligent or willful act of
Lessee (in which event Lessee shall make the repairs at Lessee's
expense), which damaged prevents Lessee from using the Premises,
Lessor may at Lessor's option either (i) repair such damage as
soon as reasonably possible at Lessor's expense, in which event
this Lease shall continue in full force and effect, or (ii) give
written notice to Lessee within thirty (30) days after the date of
the occurrence of such damage of Lessor's intention to cancel and
terminate this Lease as of the date of the occurrence of such
damage. In the event Lessor elects to give such notice of
Lessor's intention to cancel and terminate the Lease, Lease shall
have the right within ten (10) days after the receipt of such
notice to give written notice to Lessor of Lessee's intention to
repair such damage at Lessee's expense, without reimbursement from
Lessor, in which event this Lease shall continue in full force and
effect, and Lessee shall proceed to make such repairs as soon as
reasonably possible. If Lessee does not give such notice within
such 10-day period this Lease shall be cancelled and terminated as
of the date of occurrence of such damage.
9.3 PREMISES TOTAL DESTRUCTION; PREMISES BUILDING TOTAL DESTRUCTION;
INDUSTRIAL CENTER BUILDINGS TOTAL DESTRUCTION.
(a) Subject to the provisions of paragraphs 9.4 and 9.5, if at any
term during the term of this Lease there is damage, whether or not
it is an Insured Loss, and which falls into the classifications of
either (i) Premises Total Destruction, or (ii) Premises Building
Total Destruction, or (iii) Industrial Center Buildings Total
Destruction, then Lessor may at Lessor's option either (i) repair
such damage or destruction, but not Lessee's fixtures,
<PAGE>
equipment or tenant improvements, as soon as reasonably possible
at Lessor's expense, and this Lease shall continue in full force
and effect, or (ii) give written notice to Lessee within thirty
(30) days after the date of occurrence of such damage of Lessor's
intention to cancel and terminate this Lease, in which case this
Lease shall be cancelled and terminated as of the date of
occurrence of such damage.
9.4 DAMAGE NEAR END OF TERM.
(a) Subject to paragraph 9.4(b), if at any time during the last six
months of the term of this Lease there is substantial damage,
whether or not an insured Loss, which falls within the
classification of Premises Partial Damage. Lessor may at Lessor's
option cancel and terminate this Lease as of the date of
occurrence of such damage by giving written notice to Lessee of
Lessor's election to do so within 30 days after the date of
occurrence of such damage.
(b) Notwithstanding paragraph 9.4 (a), in the event that Lessee has an
option to extend or renew this Lease, and the time within which
said option may be exercised has not yet expired, Lessee shall
exercise such option, if it is to be exercised at all, no later
than twenty (20) days after the occurrence of an Insured Loss
falling within the classification of Premises Partial Damage
during the last six months of the term of this Lease. If
Lessee duly exercises such option during said twenty (20) day
period, Lessor shall, at Lessor's expense, repair such damage,
but not Lessee's fixtures, equipment or tenant improvements, as
soon as reasonably possible and this Lease shall continue in
full force and effect. If Lessee fails to exercise such option
during said twenty (20) day period, then Lessor may at Lessor's
option terminate and cancel this Lease as of the expiration of
said twenty (20) day period by giving written notice to Lessee
of Lessor's election to do so within ten (10) days after the
expiration of said twenty (20) day period, notwithstanding any
term or provision in the grant of option to the contrary.
9.5 ABATEMENT OF RENT; LESSEE'S REMEDIES.
(a) In the event Lessor repairs or restores the Premises pursuant to
the provisions of this paragraph 9, the rent payable hereunder for
the period during which such damage, repair or restoration
continues shall be abated in proportion to the degree to which
Lessee's use of the Premises is impaired. Except for abatement of
rent, if any, Lessee shall have no claim against Lessor for any
damage suffered by reason of any such damage, destruction, repair
or restoration.
(b) If Lessor shall be obligated to repair or restore the Premises
under the provisions of this paragraph 9 and shall not commence
such repair or restoration within ninety (90) days after such
obligation shall accrue, Lessee may at Lessee's option cancel and
terminate this Lease by giving Lessor written notice of Lessee's
election to do so at any time prior to the commencement of such
repair or restoration. In such event this Lease shall terminate
as of the date of such notice.
9.6 TERMINATION - ADVANCE PAYMENTS. Upon termination of this Lease pursuant
to this paragraph 9, an equitable adjustment shall be made concerning
advance rent and any advance payment made by Lessee to Lessor. Lessor
shall, in addition, return to Lessee so much of Lessee's security deposit
as has not theretofore been applied by Lessor.
9.7 WAIVER. Lessor and Lessee waive the provisions of any statute which
relate to termination of leases when leased property is destroyed and
agree that such event shall be governed by the terms of this Lease.
10. REAL PROPERTY TAXES.
<PAGE>
10.1 PAYMENT OF TAXES. Lessor shall pay the real property tax, as defined in
paragraph 10.3, applicable to the Industrial Center subject to
reimbursement by Lessee of Lessee's Share of such taxes in accordance
with the provisions of paragraph 4.2, except as other wise provide in
paragraph 10.2.
10.2 ADDITIONAL IMPROVEMENTS. Lessee shall not be responsible for paying
Lessee's Share of any increase in real property tax specified in the tax
assessor's records and work sheets as being caused by additional
improvements placed upon the Industrial Center by other Lessees or by
Lessor for the exclusive enjoyment of such other lessees. Lessee shall,
however, pay to Lessor at the time that Operating Expenses are payable
under paragraph 4.2 (c) the entirety of any increase in real property tax
if assessed solely by reason of additional improvements placed upon the
Premises by Lessee or at Lessee's request.
10.3 DEFINITION OF "REAL PROPERTY TAX." As used herein, the term "real
property tax" shall include any form of real estate tax or assessment,
general, special, ordinary or extraordinary, and any license fee,
commercial rental tax, improvement bond or bonds, levy or tax (other than
inheritance, personal income or estate taxes) imposed on the Industrial
Center or any portion thereof by any authority having the direct or
indirect power to tax, including any city, county, state or federal
government, or any school, agricultural, sanitary, fire, street, drainage
or other improvement district thereof, as against any legal or equitable
interest of Lessor in the Industrial Center or in any portion thereof, as
against Lessor's right to rent or other income therefrom, and as against
Lessor's business of leasing the Industrial Center. The term "real
property tax" shall also include any tax, fee, levy, assessment or charge
(i) in substitution of, partially or totally, any tax, fee levy,
assessment or charge hereinabove included within the definition of "real
property tax," or (ii) the nature of which was hereinbefore included
within the definition of "real property tax," or (iii) which is imposed
for a service or right not charge prior to June 1, 1978, or, if
previously charged, has been increased since June 1, 1078, or (iv) which
is imposed as a result of a transfer, either partial or total, of
Lessor's interest in the Industrial Center or which is added to a tax or
charge hereinbefore included within the definition of real property tax
by reason of such transfer, or (v) which is imposed by reason of this
transaction, any modifications or changes hereto , or any transfers
hereof.
10.4 JOINT ASSESSMENT. If the industrial center is not separately assessed,
Lessee's Share of the real property tax liability shall be an equitable
proportion of the real property taxes for all of the land and
improvements included within the tax parcel assessed, such proportion to
be determined by Lessor from the respective valuations assigned in the
assessor's work sheets or such other information as may be reasonably
available. Lessor's reasonable determination thereof, in good faith,
shall be conclusive.
10.5 PERSONAL PROPERTY TAXES.
(a) Lessee shall pay prior to delinquency all taxes assessed against
and levied upon trade fixtures, furnishings, equipment and all
other personal property of Lessee contained in the premises or
else where. When possible, Lessee shall cause said trade
fixtures, furnishings, equipment and all other personal property
to be assessed and billed separately from the real property of
Lessor.
(b) If any of Lessee's said personal property shall be assessed with
Lessor's real property, Lessee shall pay to Lessor the taxes
attributable to Lessee within ten (10) days after receipt of a
written statement setting forth the taxes applicable to Lessee's
property.
11. UTILITIES. Lessee shall pay for all water, gas, heat, light, power,
telephone and other utilities and services supplied to the Premises,
together with any taxes thereon. If any such services are not separately
metered to the Premises, lessee shall pay at Lessor's option, either
Lessee's Share or a reasonable proportion to be determined by Lessor of
all charges jointly metered with other premises in the Building.
<PAGE>
12. ASSIGNMENT AND SUBLETTING.
12.1 LESSOR'S CONSENT REQUIRED. Lessee shall not voluntarily or by operation
of law assign, transfer, mortgage, sublet, or otherwise transfer or
encumber all or any part of Lessee's interest in the Lease or in the
Premises, without Lessor's prior written consent, which Lessor shall not
unreasonably withhold. Lessor shall respond to Lessee's request for
consent hereunder in a timely manner and any attempted assignment,
transfer mortgage, encumbrance or subletting without such consent shall
be void, and shall constitute a breach of this Lease without the need for
notice to Lessee under paragraph 13.1. See Addendum for additional
terms.
12.3 TERMS AND CONDITIONS OF ASSIGNMENT. Regardless of Lessor's consent, no
assignment shall release Lessee of Lessee's obligations hereunder or
alter the primary liability of Lessee to pay the Base Rent and Lessee's
Share of Operating Expenses, and to perform all other obligations to be
performed by Lessee hereunder. Lessor may accept rent from any person
other than the Lessee pending approval or disapproval of such assignment.
Neither a delay in the approval or disapproval of such assignment nor the
acceptance of rent shall constitute a waiver or estoppel of Lessor's
right to exercise its remedies for the breach of any of the terms or
conditions of this paragraph 12 or this Lease. Consent to one assignment
shall not be deemed consent to any subsequent assignment. In the event of
default by any assignee of Lessee or any successor of Lessee, in the
performance of any of the terms hereof, Lessor may proceed directly
against Lessee without the necessity of exhausting remedies against said
assignee. Lessor may consent to subsequent assignments of this Lease or
amendments or modifications to this Lease with assignees of Lessee,
without notifying Lessee, or any successor of Lessee, and without
obtaining its or their consent thereto and such action shall not relieve
Lessee of liability under this Lease.
12.4 TERMS AND CONDITIONS APPLICABLE TO SUBLETTING. Regardless of Lessor's
consent, the following terms and conditions shall apply to any subletting
by Lessee of all or part of the premises and shall be included in the
subleases:
(a) Lessee hereby assigns and transfers to Lessor all of Lessee's
interests in all rentals and income arising from any sublease
heretofore or hereafter made by Lessee, and Lessor may collect
such rent and income and apply same toward Lessee's obligations
under this Lease; provided, however, that until a default shall
occur in the performance of Lessee's obligations under this Lease,
Lessee may receive, collect and enjoy the rents accruing under
such a sublease. Lessor shall not, by reason of this or any other
assignment of such sublease to Lessor nor by reason of the
collection of the rents from a sublessee, be deemed liable to the
sublessee for any failure of Lessee to perform and comply with any
of Lessee's obligations to such sublessee under such sublease.
Lessee hereby irrevocably authorizes and directs any such
sublease, upon a written notice from Lessor stating that a default
exists in the performance of Lessee's obligations under this
Lease, to pay Lessor the rents due and to become due under the
sublease. Lessee agrees that such sublessee shall have the right
to rely upon any such statement and request from Lessor, and that
such sublessee shall pay such rents to Lessor without any
obligation or right to inquire as to whether such default exists
and notwithstanding any notice from or claim from Lessee to the
contrary. Lessee shall have no right or claim against such
sublessee or Lessor for any such rents so paid by said sublessee
to Lessor.
(b) No sublease entered into by Lessee shall be effective unless and
until it has been approved in writing by Lessor. In entering into
any sublease, Lessee shall use only such form of sublease as is
satisfactory to Lessor, and once approved by Lessor, such sublease
shall not be changed or modified without Lessor's prior written
consent. Any sublease shall, by reason of entering into a sublease
under this Lease, be deemed, for the benefit of the Lessor, to
have assumed and agreed to conform and comply with each and every
obligation herein to be performed by Lessee other than such
obligations as are contrary to or inconsistent with provisions
contained in a sublease to which Lessor has expressly consented in
writing.
<PAGE>
(c) If Lessee's obligations under this Lease have been guaranteed by
third parties, then a sublease, and Lessor's consent thereto,
shall not be effective unless said guarantors give their written
consent to such sublease and the terms thereof.
(d) The consent by Lessor to any subletting shall not release Lessee
from its obligations or alter the primary liability of Lessee to
pay the rent and perform and comply with all of the obligations of
Lessee to be performed under this Lease.
(e) The consent by Lessor to any subletting by Lessee or to any
assignment or subletting by the sublessee. However, Lessor may
consent to subsequent sublettings and assignments of the sublease
or any amendments or modifications thereto without notifying
Lessee or anyone else liable on the Lease or sublease and without
obtaining their consent and such action shall not relieve such
persons from liability.
(f) In the event of any default under this Lease, Lessor may proceed
directly against Lessee, any guarantors or any one else
responsible for the performance of this Lease, including the
sublessee, without first exhausting Lessor's remedies against any
other person or entity responsible therefore to Lessor, or any
security held by Lessor or Lessee.
(g) In the event Lessee shall default in the performance of its
obligations under this Lease, Lessor, at its option and without
any obligation to do so, may require any sublessee to attorn to
Lessor, in which event Lessor shall undertake the obligations of
Lessee under such sublease from the time of the exercisr of said
option to the termination of such sublease; provided, however,
Lessor shall not be liable for any prepaid rents or security
deposit paid by such sublessee to Lessee or for any other prior
defaults of Lessee under such sublease.
(h) Each and every consent required of Lessee under a sublease shall
also require the consent of Lessor.
(i) No sublessee shall further assign or sublet all or any part of the
Premises without Lessor's prior written consent.
(j) Lessor's written consent to any subletting of the Premises by
Lessee shall not constitute an acknowledgement that no default
then exists under this Lease of the obligations to be performed by
Lessee nor shall such consent be deemed a waiver of any then
existing default, except as may be otherwise stated by Lessor at
the time.
(k) With respect to any subletting to which Lessor has consented,
Lessor agrees to deliver a copy of any notice of default by Lessee
to the sublessee. Such sublessee shall have the right to cure a
default of Lessee within ten (10) days after service of said
notice of default upon such sublessee, and the sublessee shall
have a right of reimbursement and offset from and against Lessee
for any such defaults cured by the sublessee.
12.5 ATTORNEY'S FEES. In the event Lessee shall assign or sublet the Premises
or request the consent of Lessor to any assignment or subletting or if
Lessee shall request the consent of Lessor for any act Lessee proposes
to do then Lessee shall pay Lessor's reasonable attorneys fees incurred
in connection therewith, such attorneys fees not to exceed $350.00 for
each subsequent request.
13. DEFAULT; REMEDIES.
13.1 DEFAULT. The occurrence of any one or more of the following
events shall constitute a material default of this Lease by Lessee:
(a) The vacating or abandonment of the Premises by Lessee.
<PAGE>
(b) The failure by Lessee to make any payment of rent or any
other payment required to be made by Lessee hereunder, as
and when due, where such failure shall continue for a
period of three (3) days after written notice thereof from
Lessor to Lessee. In the even that Lessor serves Lessee
with a Notice to Pay Rent or Quite pursuant to applicable
Unlawful Detainer statutes such Notice to Pay Rent or Quit
shall also constitute the notice required by this
subparagraph.
(c) Except as otherwise provided in this Lease, the failure by
Lessee to observe or perform any of the covenants,
conditions or provisions of this Lease to be observed or
performed by Lessee, other than described in paragraph (b)
above, where such failure shall continue for a period of
thirty (30) days after written notice thereof from Lessor
to Lessee; provided, however that if the nature of Lessee's
noncompliance is such that more than thirty (30) days are
reasonably required for its cure, then Lessee shall not be
deemed to be in default if Lessee commenced such cure
within said thirty (30) day period and thereafter
diligently prosecutes such cure to completion. To the
extent permitted by law, such thirty (30) day notice shall
constitute the sole and exclusive notice required to be
given to Lessee under applicable Unlawful Detainer
statutes.
(d) (i) The making by Lessee of any general arrangement or
general assignment for the benefit of creditors; (ii)
Lessee becomes a "debtor" as defined in 11 U.S.C. Section
101 or any successor statute thereto (unless, in the case
of a petition filed against Lessee, the same is dismissed
within sixty (60) days) (iii) the appointment of a trustee
or receiver to take possession of substantially all of
Lessee's assets located at the Premises or of Lessee's
interest in this Lease, where possession is not restored to
Lessee within thirty (30) days; or (iv) the attachment,
execution or other judicial seizure of substantially all of
Lessee's assets located at the Premises or of Lessee's
interest in this Lease, where such seizure is not
discharged within thirty (30) days. In the event that any
provision of this paragraph 13.1 (d) is contrary to any
applicable law, such provision shall be of no force or
effect.
(e) The discovery by Lessor that any financial statement given
to Lessor by Lessee, any assignee of Lessee, any subtenant
of Lessee, any successor in interest of Lessee or any
guarantor of Lessee's obligation hereunder, was materially
false. See addendum.
13.2 REMEDIES. In the event of any such material default by Lessee, Lessor
may at any time thereafter, with or without notice or demand and without
limiting Lessor in the exercise of any right or remedy which Lessor may
have by reason of such default:
(a) Terminate Lessee's right to possession of the Premises by
any lawful means, in which case this Lease and the term
hereof shall terminate and Lessee shall immediately
surrender possession of the Premises to Lessor. In such
event Lessor shall be entitled to recover from Lessee all
damages incurred by Lessor by reason of Lessee's default
including, but not limited to, the cost of recovering the
Premises; expenses of reletting, including necessary
renovation and alteration of the Premises, reasonable
attorney's fees, and any real estate commission actually
paid; the worth at the time of award by the court having
jurisdiction thereof of the amount by which the unpaid rent
for the balance of the term after the time of such award
exceeds the amount of such rental loss for the same period
that Lessee proves could be reasonably avoided; that
portion of the leasing commission paid by Lessor pursuant
to paragraph 15 applicable to the unexpired terms of this
Lease.
(b) Maintain Lessee's right to possession in which case this
Lease shall continue in effect whether or not Lessee shall
have vacated or abandoned the Premises. In such event
Lessor shall be entitled to enforce all of Lessor's rights
and remedies under this lease, including the right to
recover rent as it becomes due hereunder.
<PAGE>
(c) Persue any other remedy now or hereafter available to
Lessor under the laws or judicial decisions of the state
wherein the Premises are located. Unpaid installments of
rent and other unpaid monetary obligations of Lessee under
the terms of this Lease shall bear interest from the date
due at the maximum rate then allowable by
law. Lessor's remedies shall include the relief set forth
in Section 1951.2 of the California Civil Code.
13.3 DEFAULT BY LESSOR. Lessor shall not be in default unless Lessor fails to
perform obligations required of Lessor within a reasonable time, but in
no event later than thirty (30) days after written notice by Lessee to
Lessor and to the holder of any first mortgage or deed of trust covering
the Premises whose name and address shall have theretofore been furnished
to Lessee in writing, specifying wherein Lessor has failed to perform
such obligation; provided, however, that if the nature of Lessor's
obligation is such that more than thirty (30) days are required for
performance then Lessor shall not be in default if Lessor commences
performance within such thirty (30) day period and thereafter diligently
prosecutes the same to completion.
13.4 LATE CHARGES. Lessee hereby acknowledges that late payment by Lessee to
Lessor of Base Rent, Lessee's Share of Operating Expenses or other sums
due hereunder will cause Lessor to incur costs not contemplated by this
lease, the exact amount of which will be extremely difficult to
ascertain. Such costs include, but are not limited to, processing and
accounting charges, and late charges which may be imposed on Lessor by
the terms of any mortgage or trust deed covering the Property.
Accordingly, if any installment of Base Rent, Operating Expenses, or any
other sum due from Lessee shall not be received by Lessor or Lessor's
designee within ten (10) days after such amount shall be due, then
without any requirement for notice to Lesee, Lessee shall pay to Lessor a
late charge equal to 6% of such overdue amount. The parties hereby agree
that such late charge represents a fair and reasonable estimate of the
costs Lessor will incur by reason of late payment by Lessee. Acceptance
of such late charge by Lessor shall in no eventconstitute a waiver of
Lessee's default with respect to such overdue amount, nor prevent Lessor
from exercising any of the other rights and remedies granted hereunder.
In the event that a late charge is payable hereunder, whether or not
collected, for three (3) consecutive installments of any of the aforesaid
monetary obligations of Lessee, then Base Rent shall automatically become
due and payable quarterly in advance, rather than monthly,
notwithstanding paragraph 4.1 or any other provision of this Lease to the
contrary.
14. CONDEMNATION. If the Premises or any portion thereof or the Industrial
Center are taken under the power of eminent domain, or sold under the
threat of the exercise of said power (all of which are herein called
"condemnation"), this Lease shall terminate as to the part so taken as of
the date the condemning authority takes title or possession, whichever
first occurs. If more than ten percent of the floor area of the
Premises, or more than twenty-five percent of that portion of the
Common Areas designated as parking for the Industrial Center is taken by
condemnation, Lessee may, at Lessee's option, to be exercised in writing
only within ten (10) days after Lessor shall be given Lessee written
notice of such taking (or in the absence of such notice, within ten
days after the condemning authority shall have taken possession)
terminate this Lease as of the date the condemning authority takes such
possession. If Lessee does not terminate this Lease in accordance with
the foregoing, this Lease shall remain in full force and effect as to the
portion of the premises remaining, except that the rent shall be reduced
in the proportion that the floor area of the Premises taken bears to the
total floor area of the Premises. No reduction of rent shall occur if the
only area taken is that which does not have the Premises located thereon.
Any award for the taking of all or any part of the Premises under the
power of eminent domain or any payment made under threat of the exercise
of such power shall be the property of Lessor, whether such award shall
be made as compensation for diminution in value of the leasehold or for
the taking of the fee, or as severance damages; provided, however, that
Lessee shall be entitled to any award for loss of or damage to Lessee's
trade fixtures and removable personal property. In the event that this
lease is not terminated by reason of such condemnation, Lessor shall to
the extent of severance damages received by Lessor in connection with
such condemnation, repair any damage to the Premises caused by such
condemnation except to the extent that Lessee has been reimbursed
therefore by the condemning authority. Lessee shall pay any amount in
excess of such severance damages required to complete such repair.
<PAGE>
15. BROKER'S FEE.
(a) Upon execution of this Lease by both parties, Lessor shall pay to
Pacifica Commercial Realty Licensed real estate broker(s), a fee as set
forth in a separate agreement between Lessor and said broker(s), the sum
of $3,832.40, for brokerage services rendered by said broker(s) to Lessor
in this transaction.
(b) Lessor agrees to pay said fee not only on behalf of Lessor but also on
behalf of any person, corporation, association, or other entity having an
ownership interest in said real property or any part thereof, when such
fee is due hereunder. Any transferee of Lessor's interests in this Lease,
whether such transfer is by agreement or by operation of law, shall be
deemed to have assumed Lessor's obligation under this paragraph 15. Said
broker shall be a third party beneficiary of the provisions of this
paragraph 15.
16. ESTOPPEL CERTIFICATE.
(a) Each party (as "responding party") shall at any time upon not less than
ten (10) days' prior written notice from the other party ("requesting
party") execute, acknowledge and deliver to the requesting party a
statement in writing (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, and (ii) acknowledging that there are not, to
the responding party's knowledge, any uncured defaults on the part of the
requesting party, or specifying such defaults if they are claimed. Any
such statement may be conclusively relied upon by any prospective
purchaser or encumbrancer of the Premises or of the business of the
requesting party.
(b) At the requesting party's option, the failure to deliver such statement
within such time shall be a material default of this Lease by the party
who is to respond, without any further notice to such party, or it shall
be conclusive upon such party that (i) this lease is in full force and
effect, without modification except as may be represented by the
requesting party, (ii) there are no uncured defaults in the requesting
party's performance, and (iii) if Lessor is the requesting party, not
more than one month's rent has been paid in advance.
(c) If Lessor desires to finance, refinance, or sell the Property, or any
part thereof, Lessee hereby agrees to deliver to any lender or purchaser
designated by Lessor such financial statementsof Lessee as may be
reasonably required by such lender or purchaser. Such statements shall
include the past three (3) years' financial statements of Lessee. All
such financial statements shall be received by Lessor and such lender or
purchaser in confidence and shall be used only for the purposes herein
set forth.
17. LESSOR'S LIABILITY. The term "Lessor" as used herein shall mean only the
owner or owners, at the time in question, of the fee title or a lessee's
interest in a ground lease of the Industrial Center, and except as
expressly provided in paragraph 15, in the event if any transfer of such
title or interest, Lessor herein named (and in case of any subsequent
transfers then the grantor) shall be relieved from and after the date of
such transfer of all liability as respects Lessor's obligations
thereafter to be performed, provided that any fundsin the hands of the
Lessor or the then grantor at the time of such transfer, in which Lessee
has an interest, shall be delivered to the grantee. The obligations
contained in this Lease to be performed by Lessor shall, subject as
aforesaid, be binding on Lessor's successors and assigns, only during
their respective periods of ownership.
18. SEVERABILITY. The invalidity of any provision of this Lease as determined
by a court of competent jurisdiction, shall in no way affect the validity
of any other provision hereof.
19. INTEREST ON PAST-DUE OBLIGATIONS. Except as expressly herein provided,
any amount due to Lessor not paid when due shall bear interest at the
maximum rate then allowable by law from the date due. Payment of such
interest shall nor excuse or cure any default by Lessee under this Lease;
provided, however, that interest shall not be payable on late charges
incurred by Lessee nor on any amounts upon which late charges are paid by
Lessee.
<PAGE>
20. TIME OF ESSENCE. Time is of the essence with respect to the obligations
to be performed under this Lease.
21. ADDITIONAL RENT. All monetary obligations of Lessee to Lessor under the
terms of this Lease, included but not limited to Lessee's Share of
Operating Expenses and insurance and tax expenses payable shall be deemed
to be rent.
22. INCORPORATION OF PRIOR AGREEMENTS; AMENDMENTS. This Lease contains all
agreements of the parties with respect to any matter mentioned herein. No
prior or contemporaneous agreement or understanding pertaining to any
such matter shall be effective. This lease may be modified in writing
only, signed by the parties in interest at the time of the modification.
Except as otherwise stated in this Lease, Lessee hereby acknowledges that
neither the real estate broker listed in paragraph 15 hereof nor any
cooperating broker on this transaction nor the Lessor or any employee or
agents of any said persons has made any oral or written warranties or
representations to Lessee relative to the condition or use by Lessee of
the Premises or the Property and Lessee acknowledges that Lessee assumes
all responsibility regarding the Occupational Safety Health Act, the
legal use and adaptability of the Premises and the compliance thereof
with all applicable laws and regulations in effect during the term of
this Lease except as otherwise specifically stated in this Lease.
23. NOTICES. Any notice required or permitted to be given hereunder shall be
in writing and may be given by personal delivery or by certified mail,
and if given personally or by mail, shall be deemed sufficiently given if
addressed to Lessee or to Lessor at the address noted below the signature
of the respective parties, as the case may be. Either party may by notice
to the other specify a different address for notice purposes. A copy of
all notices required or permitted to be given to Lessor hereunder shall
be concurrently transmitted to such party or parties at such addresses as
Lessor may from time to time hereafter designate by notice to Lessee.
24. WAIVERS. No waiver by Lessor or any provision hereof shall be deemed a
waiver of any other provision. Lessor's consent to, or approval of, any
act shall not be deemed to render unnecessary the obtaining of Lessor's
consent to or approval of any subsequent act by Lessee. The acceptance of
rent hereunder by Lessor shall not be a waiver of any preceding breach by
Lessee of any provision hereof, other than the failure of Lessee to pay
the particular rent so accepted, regardless of Lessor's knowledge of such
preceding breach at the time of acceptance of such rent.
25. RECORDING. Either Lessor or Lessee shall, upon request of the other,
execute, acknowledge and deliver to the other a "short form" memorandum
of this lease for recording purposes.
26. HOLDING OVER. If Lessee, with Lessor's consent, remains in possession of
the Premises or any part thereof after the expiration of the term hereof,
such occupancy shall be a tenancy from month to month upon all the
provisions of this Lease pertaining to the obligations of Lessee, but all
Options, if any, granted under the terms of this Lease shall be deemed
terminated and be of no further effect during said month to month
tenancy.
27. CUMULATIVE REMEDIES. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other
remedies at law or in equity.
28. COVENANTS AND CONDITIONS. Each provision of this Lease performable by
Lessee shall be deemed both a covenant and a condition.
29. BINDING EFFECT; CHOICE OF LAW. Subject to any provisions hereof
restricting assignment or subletting by Lessee and subject to the
provisions of paragraph 17, this Lease shall bind the parties, their
personal representatives, successors and assign. This Lease shall be
governed by the laws of the State where the Industrial Center is located
and any litigation concerning this Lease
<PAGE>
between the parties hereto shall be initiated in the country in which
the Industrial Center is located.
30. SUBORDINATION.
(a) This Lease, and any Option granted hereby, at Lessor's option,
shall be subordinate to any ground lease, mortgage, deed or trust,
or any other hypothecation or security now or hereafter placed
upon the Industrial Center and to any and all advances made on the
security thereof and to all renewals, modifications,
consolidations, replacements and extensions thereof.
Notwithstanding such subordination. Lessee's right to quiet
possession of the Premises shall not be disturbed if Lessee is not
in default and so long as Lessee shall pay the rent and observe
and perform all of the provisions of this Lease, unless this Lease
is otherwise terminated pursuant to its terms. If any mortgagee,
trustee or ground lessor shall elect to have this Lease and any
Options granted hereby prior to the lien of its mortgage, deed of
trust or ground lease, and shall give written notice thereof to
Lessee, this Lease and such Options shall be deemed prior to such
mortgage, deed of trust or ground lease, whether this lease or
such Options are dated prior or subsequent to the date of said
mortgage, deed of trust or ground lease or the date of recording
thereof.
(b) Lessee agrees to execute any documents required to effectuate an
attornment, a subordination or to make this Lease or any Option
granted herein prior to the lien of any mortgage, deed of trust or
ground lease, as the case may be. Lessee's failure to execute
such documents within ten (10) days after written demand shall
constitute a material default by Lessee hereunder without further
notice to Lessee or, at Lessor's option. Lessor shall execute
such documents on behalf of Lessee, as Lessee's attorney-in-fact.
Lessee does hereby make, constitute and irrevocably appoint Lessor
as Lessee's attorney-in-fact and in Lessee's name, place and
stead, to execute such documents in accordance with this paragraph
30(b).
31. ATTORNEY'S FEES. If either party or the broker(s) named herein bring an
action to enforce the terms hereof or declare rights hereunder, the
prevailing party in any such action, on trial or appeal, shall be
entitled to his reasonable attorney's fees to be paid by the losing party
as fixed by the court. The provisions of this paragraph shall inure to
the benefit of the broker named herein who seeks to enforce a right
hereunder.
32. LESSOR'S ACCESS. Lessor and Lessor's agents shall have the right to
enter the Premises at reasonable times for the purpose of inspecting the
same, showing the same to prospective purchasers, lenders, or lessees,
and making such alternations, repairs, improvements or additional to the
Premises or to the building of which they are part of Lessor may deem
necessary or desirable. Lessor may at any time place on or about the
Premises or the Building any ordinary "For Sale" signs and Lessor may at
any time during the last 120 days of the term hereof place on or about
the Premises any ordinary "For lease" signs. All activities of Lessor
pursuant to this paragraph shall be without abatement of rent, nor shall
Lessor have any liability to Lessee for the same.
33. AUCTIONS. Lessee shall not conduct, nor permit to be conducted, either
voluntarily or involuntarily or involuntarily, any auction upon the
Premises or the Common Areas without first having obtained Lessor's prior
written consent. Notwithstanding anything to the contrary in this Lease,
Lessor shall not be obligated to exercise any standard of reasonableness
in determining whether to grant such consent.
34. SIGNS. Lessee shall not place any sign upon the Premises or the
Industrial Center without Lessor's prior written consent. Under no
circumstances shall Lessee place a sign on any roof of the Industrial
Center.
<PAGE>
35. MERGER. The voluntary or other surrender of this Lease by Lessee, or a
mutual cancellation thereof, or a termination by Lessor, shall not work a
merger, and shall, at the option of Lessor, terminate all or any existing
subtenancies or may, at the option of Lessor, operate as an assignment to
Lessor of any or all of such subtenancies.
36. CONSENTS. Except paragraph 33 hereof, wherever in this Lease the consent
of one party is required to an act of the other party such consent shall
not be unreasonably withhold or delayed.
37. GUARANTOR. In the event that there is a guarantor of this Lease, said
guarantor shall have the same obligations as Lessee under this Lease.
38. QUIET POSSESSION. Upon Lessee paying the rent for the Premises and
observing the performing all of the covenants, conditions and provisions
on Lessee's part to be observed and performed hereunder, Lessee shall
have quiet possession of the Premises for the entire term hereof subject
to all of the provisions of this Lease. The individuals executing this
Lease on behalf of Lessor represent and warrant to Lessee that they are
fully authorized the legally capable of executing this Lease on behalf of
Lessor and that such execution is binding upon all parties holding an
ownership interest in the Property.
39. OPTIONS.
39.1 DEFINITION. As used in this paragraph the work "Option" has the
following meaning: (1) the right or option to extend the term of this
Lease or to renew this Lease or to extend or renew any lease that Lessee
has on other property of Lessor; (2) the option or right of first refusal
to lease the Premises or the right of first offer to lease the Premises
or the right of first refusal to lease other space within the Industrial
Center or other property of Lessor or the right of first offer to lease
other space within the Industrial Center or other property of Lessor; (3)
the right or option to purchase the Premises or the Industrial Center, or
the right of first refusal to purchase the Premises or the Industrial
Center, or the right of first offer to purchase the Premises or the
Industrial Center, or the right or option to purchase other property of
Lessor, or the right of first refusal to purchase other property of
Lessor of the right of first offer to purchase other property of Lessor.
39.2 OPTIONS PERSONAL. Each Option granted to Lessee in this Lease is
personal to the original Lessee and may be exercised only by the original
Lessee while occupying the Premises who does so without the intent of
thereafter assigning this Lease or subletting the Premises or any portion
thereof, and may not be exercised or be assigned, voluntarily or
involuntarily, by or to any Lessee Affiliate as defined in paragraph 12.2
of this lease. The Options, if any, herein granted to Lessee are not
assignable separate and apart from this Lease, nor may any Option be
separated from this Lease in any manner, either by reservation or
otherwise.
39.3 MULTIPLE OPTIONS. In the event that Lessee has any multiple options to
extend or renew this Lease a later option cannot be exercised unless the
prior option to extend or review this Lease has been so exercised.
39.4 EFFECT OF DEFAULT ON OPTIONS.
(a) Lessee Shall have no right to exercise an Option, notwithstanding
any provision in the grant of Option to the contrary, (i) during
the time commencing from the date Lessor gives to Lessee a notice
of default pursuant to paragraph 13.1(b) or 13.1(c) and continuing
until the noncompliance alleged in said notice of default is
cured, or (ii) during the period of time commencing on the date
after a monetary obligation to Lessor is due from Lessee and
unpaid (without any necessity for notice thereof to Lessee) and
continuing until the obligation is paid, or (iii) at any time
after an event of default described in paragraphs 13.1 (d), or
13.1(e) (without any necessity of Lessor to give
<PAGE>
notice of such default to Lessee), nor (iv) in the event that
lessor has given to Lessee three or more notices of default
under paragraph 13.1(b), or paragraph 13.1(c), whether or not
the defaults are cured, during the 12 month period of time
immediately prior to the time that Lessee attempts to exercise
the subject Option.
(b) The period of time within which an Option may be exercised shall
not be extended or enlarged by reason of Lessee's inability to
exercise an Option because of the provisions of paragraph 39.4(a).
(c) All rights of Lessee under the provisions of an Option shall
terminate and be of no further force or effect, notwithstanding
Lessee's due and timely exercise of the Option, if, after such
exercise and during the term of this Lease, (i) Lessee fails to
pay to Lessor a monetary obligation of Lessee for a period of
thirty (30) days after such obligation becomes due (without any
necessity of Lessor to give notice thereof to Lessee), or (ii)
Lessee fails to commence to cure a default specified in paragraph
13.1(c) within thirty(30) days after the date that lessor gives
notice to Lessee of such default and/or Lessee fails thereafter to
diligently prosecute said cure to completion, or (iii) Lessee
commits a default described in paragraph 13.1(a), 13.1(d) or 13.1
(e) (without any necessity of Lessor to give notice of such
default to Lessee), or (iv) Lessor gives to Lessee three or more
notices of default under paragraph 13.1(b), or paragraph 13.1 (c),
whether or not the defaults are cured.
40. SECURITIES MEASURES. Lessee hereby acknowledges that Lessor shall have no
obligation whatsoever to provide guard service or other security measures
for the benefit of the Premises or the Industrial Center. Lessee assumes
all responsibility for the protection of Lessee, its agents, and invitees
and the property of Lessee and of Lessee's agents and invitees from acts
of third parties. Nothing herein contained shall prevent Lessor, at
lessor's sole option, from providing security protection for the
Industrial Center or any part thereof, in which event the cost thereof,
in which event the cost thereof shall be included within the definition
of Operating Expenses, as set forth in paragraph 4.2(b).
41. EASEMENTS. Lessor reserves to itself the right, from time to time, to
grant such easements, rights and dedications that Lessor deems necessary
or desirable, and to cause the recordation of Parcel Maps and
restrictions, so long as such easements, rights, dedications, Maps and
restrictions do not unreasonably interfere with the use of the Premises
by Lessee. Lessee shall sign any of the aforementioned documents upon
request of Lessor and failure to do so shall constitute a material
default of this Lease by Lessee without the need for further notice to
Lessee.
42. PERFORMANCE UNDER PROTEST. If at any time a dispute shall arise as to
any amount or sum of money to be paid by one party to the other under the
provisions hereof, the party against whom the obligation to pay the money
is asserted shall have the right to make payment "under protest' and such
payment shall not be regarded as a voluntary payment, and there shall
survive the right on the part of said party to institute suit for the
recovery of such sum. If it shall be adjudged that there was no legal
obligation on the part of said party to pay such sum or any part thereof,
said party shall be entitled to recover such sum or so much thereof as it
was not legally required to pay under the provisions of this Lease.
43. AUTHORITY. If Lessee is a corporation, trust, or general or limited
partnership, each individual executing this Lease on behalf of such
entity represents and warrants that he or she is duly authorized to
execute and deliver this Lease on behalf of said entity. If Lessee is a
corporation, trust or partnership, Lessee shall, within thirty (30) days
after execution of this Lease, deliver to lessor evidence of such
authority satisfactory to Lessor.
44. CONFLICT. Any conflict between the printed provisions of this Lease and
the typewritten or handwritten provision, if any, shall be controlled by
the typewritten or handwritten provisions.
<PAGE>
45. OFFER. Preparation of this Lease by Lessor or Lessor's agent and
submission of same to Lessee shall not be deemed an offer to lease. This
Lease shall become binding upon Lessor and Lessee only when fully
executed by Lessor and Lessee.
46. ADDENDUM. Attached hereto is an addendum or addenda containing
paragraphs A through H which constitue a part of this Lease.
47. MODIFICATION FOR LENDER. If in connection with obtaining financing for
the building, the Lender shall request reasonable modifications in this
Lease as a condition to such financing, Lessee will not unreasonably
withhold, delay, or defer its consent thereto, provided that such
modifications do not increase the obligations of Lessee hereunder or
materially adverse affect the leasehold interest hereby created.
48. LESSOR OPTION TO RELOCATE LESSEE. At any time after Lessee's execution
of this Lease, Lessor shall have the right, upon providing Lessee thirty
(30) days notice in writing, to provide and furnish Lessee with space
elsewhere in the building of approximately the same size as said
Premises, and to move and place Lessee in such new space at Lessor's
expense. In the event Lessor moves Lessee to such new space, then this
Lease and each and all of the terms and covenants and conditions hereof
shall thereupon remain in full force and effect and be deemed applicable
to such new space except that a revised Exhibit "A" shall become a part
of this Lease and shall reflect the location of the new space and
Paragraphs 4.1, 4.2, and 5 shall be amended to show correct data. Should
Lessee refuse to permit Lessor to move Lessee to such new space at the
end of said thirty (30) day period, Lessor shall have the right to
terminate this Lease by notice to such effect given to Lessee in writing
within ten (10) days following the end of said thirty (30) day period,
which termination shall be effective sixty (60) days after the date of
the original relocation by Lessor.
49. MORTGAGE PROTECTION. Lessee agrees to give any mortgages and/or trust
deed holders, as to all or a portion of the Premises, by registered mail,
a copy of any notice of default served upon Lessor, provided that prior
to such notice Lessee has been notified in writing (by way of notice or
assignment of rents and leases, or otherwise) of the addresses of such
mortgages an/or trust deed holders. Lessee agrees not to exercise any
remedies available by virtue of a default unless Lessor shall have failed
to cure such default within thirty (30) days after receipt of notice of
default or such additional time as may be reasonably necessary to cure
the default in the case of a default incapable of being cured within
thirty (30) days within which to cure such default, or if such default
cannot be cured within that time, then such additional time as may be
necessary if within such thirty (30) days any mortgagee and/or trust deed
holder has commenced and is diligently pursuing the remedies necessary to
cure such default (including but not limited to commencement of
foreclosure proceedings if necessary to effect such cure), in which event
such right, if any, as Lessee might otherwise have to terminate the Lease
shall not be exercised while such remedies are being so diligently
pursued.
8.1 LIABILITY INSURANCE-LESSEE. Lessee shall, at Lessee's expense, obtain
and keep in force during the term of this Lease a policy of Comprehensive
General Liability insurance utilizing an Insurance Services Office
standard form with Broad Form General Liability Endorsement (GLO404), or
equivalent, in an amount of not less than 1) $1,000,000 per occurrence
of Bodily Injury and Property Damage combined single limit with a
$1,000,000 excess liability policy, or 2) $1,000,000 per occurrence of
Bodily Injury and Property Damage with a $2,000,000 General Aggregate
Bodily Injury and Property Damage, and shall insure Lessee with a Lessor
as an additional insured against liability arising out of the use,
occupancy or maintenance of the Premises. The policy shall insure
performance by Lessee of the indemnity provisions of this paragraph 8.
The limits of said insurance shall not, however, limit the liability of
Lessee hereunder.
<PAGE>
LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
PROVISION CONTAINED HEREIN AND, BY EXECUTION OF THIS LEASE, SHOW THEIR INFORMED
AND VOLUNTRAY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE TIME THIS
LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE AND
EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE
PREMISES.
THIS LEASE HAS BEEN PREPARED FOR SUBMISSION TO YOUR ATTORNEY FOR
APPROVAL. NO REPRESENTATION OR RECOMMENDAION IS MADE BY TH
AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION OR BY THE REAL ESTATE
BROKER OR ITS AGENTS OR EMPLOYEES AS TO THE LEGAL SUFFICIENCY,
LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS LEASE OR THE TRANSACTION
RELATING THERETO: THE PARTIES SHALL RELY SOLELY UPON THE ADVICE
OF THEIR OWN LEGAL COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF
THIS LEASE.
LESSOR LESSEE
William D & Edan J. Wright dba ValueClick, Inc.
South Coast Business Park a Delaware Corporation
------------------------- ----------------------
By ILLEGIBLE By /s/ JAMES ZARLEY
--------------------------- ---------------------------
By By
-------------------------- --------------------------
Executed on 9/10/99 Executed on
--------------- ------------------
(Corporate Seal) (Corporate Seal)
ADDRESS FOR NOTICES AND RENT ADDRESS
-------------------------------- ------------------------------
130 Garden Street
-------------------------------- ------------------------------
Santa Barbara, California 93101
-------------------------------- ------------------------------
For these forms write the American Industrial Real Estate Association, 350 South
Figueroa St., Suite 275 Los Angeles, CA 90071 (213) 687-8777
<PAGE>
ADDENDUM TO LEASE
This ADDENDUM is attached to and forms a part of that certain Standard
Industrial Lease dated for reference purposes AUGUST 30, 1999, by and between
William D & Edna J. Wright dba South Coast Business Park ("Lessor"), and
VALUECLICK, INC., A DELAWARE CORPORATION ("Lessee"). The said Standard
Industrial Lease is hereby modified/supplemented (and as
modified/supplemented is hereinafter referred to as "this Lease") in the
following particulars only:
A. OPTION TO EXTEND TERM OF LEASE. Lessee is hereby granted the
option to extend the term of this Lease of N/A ( ) additional
successive periods of N/A ( ) years each. The options
shall be exercised by the delivery of written notice to Lessor no earlier
than two hundred seventy (270) days an no later than one hundred eighty (180)
days prior to the expiration of the lease term then in effect. Any
extentions granted hereunder shall be on the same terms and conditions
applicable to the initial term except as to rent, which shall be increased I
accordance with paragraph B(2) below. Lessee's right to exercise the options
granted herein is subject to the terms and conditions set forth in paragraph
39 of this Lease.
B. ADJUSTMENT TO BASE RENT.
(1) Cost of Living Adjustments to Base Rent. The Base Rent
payable pursuant to Paragraph 4.1 shall be subject to further adjustment as of
N/A, and as of the same date each year thereafter during the initial lease term
and any extension period. Said date is hereinafter referred to as the
"Adjustment Date." The adjustment shall be made as follows:
The Base Rent for the Premises shall be adjusted by the same
percentage as the increase, if any, in the Consumer Price Index (All Items
for All Urban Consumer 1982-84 = 100 Base), of the United States Department
of Labor, Bureau of Labor Statistics for Los Angeles-Anaheim-Riverside, CA
(the "Index"). The adjustment shall be calculated according to the following
formula:
X = A x B
-
C
X = Adjusted rent
A = Base Rent as of the first month of the term then in effect.
B = The monthly index for the third month immediately preceding the
Adjustment Date.
C = The monthly index for the third month immediately preceding the first
month of the term then in effect.
The month rent as so adjusted shall be payable for each month commencing with
the Adjustment Date and continuing until the next Adjustment Date.
If the Index is discontinued or revised during the term of this Lease, such
other government Index or computation with which it is replaced shall be used
in order to obtain substantially the same result as would be obtained if the
Index had not been discontinued or revised.
<PAGE>
C. USE. Paragraph 6 of this Lease is hereby supplemented as follows:
(1) Prohibited Uses. Lessee shall not do or permit anything to be done in or
about the Premises nor bring or keep anything therein which will in any
way increase the existing rate of or affect any fire or other insurance
upon the Premises or any of its contents, or cause a cancellation of any
insurance policy covering the Premises or any part thereof or any of its
contents. Lessee shall not commit or suffer to be committed any nuisance
or waste in or upon the Premises. Lessee shall not use the Premises or
permit anything to be done in or about the Premises which will in any way
conflict with any law, statute, ordinance or governmental rule or
regulation now in force or which may hereafter be enacted or promulgated.
Lessee shall not keep any animals or pets on the Premises. Lessee shall
not use or store "hazardous materials or wastes" on the Premises, as such
terms are defined by applicable federal and state law, without Lessor's
prior written consent. If such consent is given, Lessee shall comply
with governmental laws, rules and regulations pertaining to hazardous
materials and wastes. Lessor shall have a right of re-entry upon the
Premises on reasonable notice and at reasonable times for purpose of
inspection, contamination testing and remediation.
(2) Installation of Specialized Equipment and Use of Lessee's
Possessions on the Premises. Lessee shall not install on the Premises any
specialized equipment requiring the use of a power source (including, but not
limited to, computer hardware or software) without the prior written consent
of Lessor. Lessor shall give its consent to such installation provided the
conditions contained herein are satisfied. Lessor shall not be liable to
Lessee for damage to Lessee or Lessee's possession, including but not limited
to furniture, fixture, equipment (specialized or otherwise), and inventory,
from any course. Lessee waives all claims against Lessor for damage to
lessee's possessions arising for any reason. Lessee shall comply with all
laws, regulations or ordinances relating to the condition and use of any and
all of Lessee's possessions on the Premises, including laws requiring the
alteration, maintenance and restoration of the Premises as a result of
Lessee's particular use. Provided, however, any required alterations to the
Premises shall be conditioned upon Lessor's prior written consent. The
Premises shall not be electrically overloaded. No equipment, machinery,
apparatus or other appliance shall be used or operated on the premises in
such a manner that such equipment will in any way injure, vibrate or shake
the Premises, or place an excessive burden on power sources installed on the
Premises.
E. ASSIGNMENT AND SUBLETTING. Lessee hereby understands and agrees that
Lessor may withhold its consent to any requested assignment or subletting,
and such withholding of consent shall be deemed reasonable, in the event that
the proposed assignee or sublessee intends to use or store hazardous wastes
or materials on the Premises. Also, it is a requirement that Lessor receive
seventy five percent (75%) of any consideration or increase in rent received
or to be received by Lessee for such assignment or sublease. Please note
that the term of the sublease may not exceed the term of the "master" lease.
F. INDEMNITY. The indemnification of Lessor by Lessee pursuant to
Paragraph 8.7 of this Lease shall also include and extend to any violation by
Lessee of applicable state, federal and local laws pertaining to the use,
storage and discharge of hazardous materials and wastes.
G. DEFAULT. Paragraph 13.1 of this Lease is supplemented to provide that
the release or discharge by Lessee of any hazardous material or wastes in or
about the Premises, or violation of any law or deviation from prescribed
procedures in the use or storage of hazardous materials or wastes, shall
constitute a material default of this Lease by Lessee. Wherever used in this
Lease, the terms hazardous wastes and/or hazardous material shall include all
definitions of hazardous wastes and materials provided by both federal and
California Law.
I. CONDITIONS PRECEDENT TO EFFECTIVENESS. In addition to any other
conditions for the benefit of Lessor under the Lease, Lessor's obligations
under the Lease and the effectiveness of the Lease as against the lessor are
subject to the following condition for the benefit of Lessor, which condition
may be waived in Lessor's sole and absolute discretion.
<PAGE>
a. The execution and delivery by Q.A.D., Inc., the existing Lessee of
Suites 1 & 2 of the Premises, of any document necessary to terminate its
leasehold interest in Suites 1 & 2, upon terms and conditions which are
acceptable to Lessor in Lessor's sole and absolute discretion
IN WITNESS WHEREOF, Lessor and Lessee have each caused this Addendum to be
executed concurrently with the Lease of which this Addendum forms a part.
LESSOR:
WILLIAM D & EDNA J. WRIGHT dba
SOUTH COAST BUSINESS PARK
BY: ILLEGIBLE Dated: 9/10/99
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LESSEE:
VALUECLICK, INC., A DELAWARE CORPORATION
BY: /s/ JAMES ZARLEY Dated: 9/2/99
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