Fillable Printable Standard Arizona Commercial Lease Agreement
Fillable Printable Standard Arizona Commercial Lease Agreement
Standard Arizona Commercial Lease Agreement
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(DO NOT USE THIS FORM FOR MULTI-TENANT BUILDINGS)
1. Basic Provisions ("Basic Provisions").
1.1 Parties: This Lease ("Lease"), dated for reference purposes only, __________________________________________________, is made
By and between ________________________________________________________________________________________________________ .("Lessor")
and __________________________________________________________________________________________________________________("Lessee"),
(collectively the "Parties," or individually a "Party").
1.2 Premises: That certain real property, including all im provements therein or to be provided by Lessor under the terms of t his Lease, and
commonly known as ________________________________________________________________________________________________________________,
located in the County of ___________________________, State of _____________________________________________________, and generally described as
(describe briefly the nature of the property and, if applicable, the "Project", if the property is located within a Project)
__________________________________________________________________________________________________________________________________
___________________________________________________________________________________________________("Premises"). (See also Paragrap h 2)
1.3 Term: ______________years and _____________ months ("Original Term") commencing _____________________________________
("Commencement Date") and ending ___________________________________________________________ ("Expiration Date"). (See also Paragraph 3)
1.4 Early Possession: _______________________________________________________________________________ ("Early Possessio n Date")
(See also Paragraphs 3.2 and 3.3).
1.5 Base Rent: $ _____________ per month ("Base Re nt "), payable on the _____________________________________________________ day of
each month commencing ___________________________________________________________________________________________(See also Paragraph 4)
[ ] If this box is checked, there are provisions in this Lease for the Base Rent to be adjusted.
1.6 Base Rent and Other Monies Paid Upon Execution:
(check applicable boxes)
[ ] Base Rent: $_________________________________ for the period ______________________________________________
[ ] Security Deposit: $___________________________ ("Security Deposit"). (See also Paragraph 5)
[ ] Association Fees: $___________________________ for the period ______________________________________________
[ ] Other: $_____________________________________ for _______________________________________________________
[ ] Total Due Upon Execution of this Lease: $____________________________________________________.
1.7 Agreed Use: ___________________________________________________________________________________________________________
________________________________________________________________________________________________________________(See also Paragraph 6)
1.8 Insuring Party: Lessor is the "Insuring Party" unless otherwise stated herein. (See also Paragraph 8)
1.9 Real Estate Brokers: (See also Paragraph 15)
(a) Representation:The following real estate brokers (the "Brokers") and brokerage relationships exist in this transaction:
(check applicable boxes)
[ ] _________________________________________________________________represents Lessor exclusively ("Lessor's Broker(s)");
[ ]______________________________________________________________represents Lessee exclusively ("Lessee's Broker(s)"); or
[ ]_________________________________________________________________represents both Lessor and Lessee ("Dual Agency").
(b) Payment to B rokers : Upon execution and delivery of this Lease by both Parties, Lessor shall pay to the Broker the fee agreed to in their
separate written agreement (or if there is no such agreement, the sum of _______________ or ____________% of the total Base Rent) for the brokerage services
rendered by the Brokers.
1.10 Guarantor. The obligations of the Lessee under this Lease are to be guaranteed by__________________________________________________
______________________________________________________________________________________________("Guarantor(s)"). (See also Paragraph 37)
1.11 Attachments. Attached hereto are the following, all of which constitute a part of this Lease:
[ ] an Addendum consisting of Paragraphs _____________ through ______________;
[ ] a plot plan depicting the Premises;
[ ] a current set of the Rules and Regulations;
[ ] a Work Letter;
[ ] other (specify): ___________________________________________________________________________________________________
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2. Premises.
2.1 Letting. Lessor here by leases t o Lessee, a nd Lessee her eby leases fro m Lessor, the P remises, fo r the term, at the re ntal, and upon al l of the terms,
covenants and conditions set forth in this Lease. Unless otherwiseprovided herein, any statement of size set forth in this Lease, or that may have been used in
calculating Rent, is an approximation which the Parties agree isreasonable and any payments based thereon are not subject to revision whether or not the actual
size is more or less. Note: Lessee is advised to verify the actual size prior to executing this Lease.
2.2 Condition. Lessor shall deliver the Premises to Lessee broom clean and free of debris on the Commencement Date or the Early Possession Date,
whichever first occurs ("Start Date"), and, so long as the required service contracts described in Paragraph 7.1(b) below are obtained by Lessee and in effect
within thirty days following the Start Date, warrants that the existing electrical, plumbing, fire sprinkler, lighting, heating, ventilating and air conditioning systems
("HVAC"), loading doors, sump pumps, if any, and all other such elements in the Premises, other than those constructed by Lessee, shall be in good operating
condition on said date and that the structural elements of the roof, bearing walls and foundation of any buildings on the Premises (the "Building") shall be free of
material defects. If a non-compliance with said warranty exists as of the Start Date, or if one of such systems or elements should malfunction or fail within the
appropriate warranty period, Lessor shall, as Lessor's sole obligation with respect to such matter, except as otherwise provided i n this L ease, prom ptly after r ecei pt
of written notice from Lessee setting forth with specificity the nature and extent of such non-compliance, malfunction or failure, rectify same at Lessors expense.
The warrant y perio ds shall be as fol lows: (i) 6 months as to the HVAC syst ems, and (ii ) 30 days as to t he remaining syst ems and other elements of the Building. If
Lessee does not give Lessor the required notice within the appropriate warranty period, correction of any such non-compliance, malfunction or failure shall be the
obligation of Lessee at Lessee's sole cost and expense.
2.3 Compliance. Lessor warrants that the improvements on the Premises comply with the building codes, applicable laws, covenants or restrictions of
record, regulations, and ordinances ("Applicable Requirements") that were in effect at the time that each improvement, or portion thereof, was constructed. Said
warranty does no t apply to the use to which Lessee will put the Premises, modifications which may be required by the Americans with Disabilities Act or any similar
laws as a result of Lessee's use (see Paragraph 50), or to any Alterations or Utility Installations (as defined in Paragraph 7.3(a)) made or to be made by Lessee.
NOTE: Les see is r esponsibl e for det ermini ng whether or no t the Applicable Requirements, and especially the zoning, are appropriate for Lesse e's inte nded u se, and
acknowledges that past uses of the Premises may no longer be allowed. If the Premises do not comply with said warranty, Lessorshall, except as otherwise
provided, promptly after receipt of written notice from Lessee setting forth with specificity the nature and extent of such non-compliance, rectify the same at
Lessor's expense. If Lessee does not give Lessor written notice of a non-complian ce with this warranty withi n 6 months following the Start Date, correction of that
non-compliance shall be the obligation of Lessee at Lessee's solecost and expense. If the Applicable Requirements are hereafter changed so as to require during
the term of this Lease the construction of an addition to oran alteration of the Premises and/or Building, the remediation of any Hazardous Substance, or the
reinforcement or other physical modification of the Unit, Premises and/or Building ("Capital Expenditure"), Lessor and Lessee shall allocate the cost of such work as
follows:
(a) Subject to Paragraph 2.3(c) bel ow, if such Capital Expenditures are required as a result of the specific and unique use of the Premises by Lessee a s
compared with uses by tenants in general, Lessee shall be fully responsible for the cost thereof, provided, however that if such Capital Expenditure is required
during the last 2 years of this Lease and the cost thereof exceeds 6 months' Base Rent, Lessee may instead terminate this Lease unless Lessor notifies Lessee, in
writing, within 10 days after receipt of Lessee's termination notice that Lessor has elected to pay the difference between theactual cost thereof and an amount
equal to 6 months' Base Rent. If Lessee elects termination, Lessee shall immediately cease the use of the Premises which requires such Capital Expenditure and
deliver to Lessor written notice specifying a termination date at least 90 days thereafter . Such termination date shall, however, i n no event be earlier tha n the last
day that Lessee could legally utilize the Premises without commencing such Capital Expenditure.
(b) If such Capital Expenditure is not the result of the specific and unique use of the Premises by Lessee (such as, governmentally mandated seismic
modificat ions), then Lesso r and Lessee shal l allocate the obli gation to pay for such co sts pursuant t o the provisio ns of Paragraph 7.1(d); pro vided, howe ver, that if
such Capital Expenditure is required during the last 2 years of this Lease or if Lessor reasonably determines that it is not ec
onomically feasible to pay its share
thereof, Lessor shall have the option to terminate this Lease upon 90 days prior written notice to Lessee unless Lessee notifies Lessor, in writing, within 10 days
after receipt of Lessor's termination notice that Lessee will pay for such Capital Expenditure. If Lessor does not elect to terminate, and fails to tender its share of
any such Capi tal Expe nditure, L essee may adva nce su ch funds and d educt same , with Inte rest, from Rent unt il Lessor's shar e of such costs have been fully pai d. If
Lessee is unable to finance Lessor's share, or if the balance of the Rent due and payable for the remainder of this Lease is not sufficient to fully reimburse Lessee
on an offset basis, Lessee shall have the right to terminate this Lease upon 30 days written notice to Lessor.
(c) Notwithstanding the above, the provisions concerning Capital Expenditures are intended to apply only to non-voluntary, unexpected, and new
Applicabl e Require ments. I f the Ca pital Expe nditures a re instead t riggere d by Lesse e as a res ult of an actual or propo sed cha nge in use, change in intensity of use,
or modification to the Premises then, and in that event, Lessee shall either: (i) immediately cease such changed use or intensity of use and/or take such other
steps as may be necessary to eliminate the requirement for such Capital Expenditure, or (ii) complete such Capital Expenditure at its own expense. Lessee shall
not, however, have any right to terminate this Lease.
2.4 Acknowledgements. Lessee acknowledges that: (a) it has been advised by Lessor and/or Brokers to satisfy itself with respect to the condition of
the Premises (including but not limited to the electrical, HVAC and fire sprinkler systems, security, environmental aspects, and compliance with Applicable
Requirements and the Americans with Disabilities Act), and their suitability for Lessee's intended use, (b) Lessee has made such investigation as it deems necessary
with reference to such matters and assumes all responsibility therefor as the same relate to its occupancy of the Premises, and (c) neither Lessor, Lessor's agents,
nor Brokers have made any oral or written representations or warranties with respect to said matters other than as set forth in this Lease. In addition, Lessor
acknowledges that: (i) Brokers have made no representations, promises or warranties concerning Lessee's ability to honor the Lease or suitability to occupy the
Premises, and (ii) it is Lessor's sole responsibility to investigate the financial capability and/or suitability of all proposed tenants.
2.5 Lessee as Prior Owner/Occupant. The warranties made by Lessor in Paragraph 2 shall be ofno force or effect if immediately prior to the Start
Date Lessee was the owner or occupant of the Premises. In such event, Lessee shall be responsi ble for any necessa ry corrective work.
3. Term.
3.1 Term. The Commencement Date, Expiration Date and Original Term of this Lease are as specified in Paragraph 1.3.
3.2 Early Possession. If Lessee totally or partially occupies the Premises prior to the Commencement Date, the obligation to pay Base Rent shall be
abated for the period of such early possession. All other terms of this Lease (including but not limited to the obligations to pay Real Property Taxes and insurance
premiums and to maintain the Premises) shall, however, be in effect during such period. Any such early possession shall not affect the Expiration Date.
3.3 Delay In Possession. Lessor agrees to use its best commercially reasonable efforts to deliver possession of the Premises to Lessee by the
Commen ce me nt D a te. I f, d es pit e said efforts , L es sor i s una bl e t o d el iv er poss es si on by su c h dat e, L es so r s ha l l no t be s ub ject to any liability therefor, nor shall such
failure affect the validity of this Lease. Lessee shall not, however, be obligated to pay Rent or perform its other obligations until Lessor delivers possession of the
Premises and any period of rent abatement that Lessee would otherwise have enjoyed shall run from the date of delivery of possession and continue for a period
equal to what Lessee would otherwise have enjoyed under the terms hereof, but minus any days of delay caused by the acts or omission s of Lesse e. If poss ession
is not delivered within 60 days after the Commencement Date, Lessee may, at its option, by notice in writing within 10 days after the end of such 60 day period,
cancel this Lease, in which event the Parties shall be discharged from all obligations hereunder. If such written notice is not received by Lessor within said 10 day
period, Lessee's right to cancel shall terminate. If possession of the Premises is not delivered within 120 days after the Commencement Date, this Lease shall
terminate unless other agreements are r eached between Lessor and Lessee, in writing.
3.4 Lessee Compliance. Lessor shall not be required to deliver possession of the Premises to Lessee until Lessee complies with its obligation to provide
evidence of insurance (Paragraph 8.5). Pending delivery of suchevidence, Lessee shall be required to perform all of its obligations under this Lease from and after
the Start Date, including the payment of Rent, notwithstanding Lessor's election to withhold possession pending receipt of such evidence of insurance. Further, if
Lessee is required to perform any other conditions prior to or concurrent with the Start Date, the Start Date shall occur but Lesso r may el ect to withhol d po ss es si on
until such conditions are satisfi ed.
4. Rent.
4.1
Rent Defined. Al monetary obligations of Lesseeto Lessor under the terms of this Lease (except for the Security Deposit) are deemed to be rent
("Rent").
4.2 Payment. L es se e shal l cau se pa yme nt of Rent t o be r ec ei ve d by Le s sor i n lawf ul money of t he U nit ed Stat es on o r befor e the day on w hich it is due,
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without offset or deduction (except as specifically permitted in this Lease). Rent for any period during the term hereof which is for less than one full calendar month
shall be prorated based upon the actual number of days of said month. Payment of Rent shall be made to Lessor at its address stated herein or to such other
persons or place as Lessor may from time to time designate in writing. Acceptance of a payment which is less than the amount then due shall not be a waiver of
Lessor's rights to the balance of such Rent, regardless of Lessor's endorsement of any check so stating. In the event that any check, draft, or other instrument of
payment given by Lessee to Lessor is dishonored for any reason, Lessee agrees to pay to Lessor the sum of $25 in addition to any Late Charge and Lessor, at its
option, may require all future payments to be made by Lessee to beby cashier's check. Payments will be applied first to accrued late charges and attorneys fees,
second to accrued interest, then to Base Rent and Operating Expense Increase, and any remaining amount to any other outstanding charges or costs.
4.3 Association Fees. In addi ti on t o t he Bas e Rent , Le sse e s hall pay t o Lessor eac h month an amo u nt eq ual to any o wner's as s o ciat io n o r condo mi niu m
fees levied or assessed against the Premises. Said monies shall be paid at the same time and in the same manner as the Base Rent.
5. Security Deposit. Lessee shall deposit with Lessor upon execution hereof the Security Deposit as security for Lessee's faithful performance of its
obligations under this Lease. If Lessee fails to pay Rent, or otherwise Defaults under this Lease, Lessor may use, apply or retain all or any portion of said Security
Deposit for the payment of any amount due Lessor or to reimburse or compensate Lessor for any liability, expense, loss or damage which Lessor may suffer or
incur by reason thereof. If Lessor uses or applies all or any portion of the Security Deposit, Lessee shall within 10 days after written request therefor deposit monies
with Lessor sufficient to restore said Security Deposit to the full amount required by this Lease. If the Base Rent increases during the term of this Lease, Lessee
shall, upon written request from Lessor, deposit additional moneys with Lessor so that the total amount of the Security Deposit shall at all times bear the same
proportion to the increased Base Rent as the initial Security Deposit bore to the initial Base Rent. Should the Agreed Use be amended to accommodate a material
chang e in the busi ness of Le ssee or to accommoda te a suble ssee or assi gnee, Les sor shall hav e the right t o increas e the Sec urity Deposit to the extent necessary,
in Lessor's reasonable judgment, to account for any increased wear and tear that the Premises may suffer as a result thereof. If a change in control of Lessee
occurs during this Lease and following such cha nge the financial condition of Lessee is, in Lessor's reasonable judgment, signif icantly redu ced, Less ee shall d eposit
such additional monies with Lessor as shall be sufficient to cause the Security Deposit to be at a commercially reasonable level based on such change in financial
condition. Lessor shall not be required to keep the Security Deposit separate from its general accounts. Within 14 days after the expiration or termination of this
Lease, if Lessor elects to apply the Security Deposit only to unpaid Rent, and otherwise within 30 days after the Premises have been vacate d pur sua nt to Parag rap h
7.4(c) below, Lessor shall return that portion of the Security Deposit no t us ed o r a ppl ie d b y Les so r. No part o f the Securit y Deposit shall be considered to be held in
trust, to bear interest or to be prepayment for any monies to be paid by Lessee under thisLease.
6. Use.
6.1 Use . Lessee shall use and occupy the Premises only for the Agreed Use, or any other legal use which is reasonably comparable thereto, and for no
other purpose. Lessee shall not use or permit the use of the Premises in a manner that is unlawful, creates damage, waste or anuisance, or that disturbs occupants
of or cau ses dama ge to n eighbori ng premi ses or pro pert ies. Lessor shall not unreasonably withhold or delay its consent to any written request for a modification of
the Agreed Use, so long as the same will not impair the structural integrity of the improvements on the Premises or the mechanical or electrical systems therein,
and/or is not significantly more burdensome to the Premises. If Lessor elects to withhold consent, Lessor shall within 7 days after such request give written
notification of same, which notice shall include an explanation of Lessor's objections to the change in the Agreed Use.
6.2 Hazardous Substances.
(a) Reportable Uses Require Consent. The term "Hazardous Substance" as used in this Lease shall mean any product, substance, or waste whose
presenc e, use , ma nufacture, dis po sa l, t ranspo rt at io n, o r rel ease, ei t her by i t self o r i n combi natio n wi th o the r mat erial s exp ected to be o n the Pr emi s es, is ei th er: (i )
potentially injurious to the public health, safety or welfare, the environment or the Premises, (ii) regulated or monitored by any governmental authority, or (iii) a
basis for potential liability of Lessor to any governmental agency or third party under any applicable statute or common law theory. Hazardous Substances shall
include, but no t be l imit ed to, hydro carbo ns, petr ole um, gasol ine, an d/o r crude o il or any pro ducts, by -pro duct s or fractio ns ther eof . Less ee sha ll no t engage in a ny
activity in or on the Premises which constitutes a Reportable Use of Hazardous Substances without the express prior written consent of Lessor and timely
compliance (at Lessee's expense) with all Applicable Requirements. "Reportable Use" shall mean (i) the installation or use of any abov e or below ground storage
tank, (ii) the generation, possession, storage, use, transportation, or disposal of a Hazardous Substance that requires a permit from, or with respect to which a
report, notice, registration or business plan is required to be filed with, any governmental authority, and/or (iii) the presence at the Premises of a Hazardous
Substance with respect to which any Applicable Requirements requires that a notice be given to persons entering or occupying the Premises or neighboring
properties. Notwithstanding the foregoing, Lessee may use any ordinary and customary materials reasonably required to be used in the normal course of the
Agreed Use , ordinary offi ce supplies (copi er toner, liquid pap er, glue, etc.) an d common house hold cleaning materials, so long as such use is in compliance with all
Applicabl e Requir ement s, is no t a Repo rtable Us e, and does not expo se the Pr emis es or nei gh boring p ropert y t o any meanin gful risk of contamination or damage or
expose Lessor to any liability therefor. In addition, Lessor may condition its consent to any Reportable Use upon receiving such additional assurances as Lessor
reasonably deems necessary t o prot ect it self, the publi c, the Premi se s and/or t he environ ment against damag e, conta minati on, i njury a nd/or l iabi li ty, i ncludin g, but
not limited to, the installation (and removal on or before Lease expiration or termination) of protective modifications (such as concrete encasements) and/or
increasing the Security Deposit.
(b) Duty to Inform Lessor. If Lessee knows, or has reaso nable cause to believe, that a Hazardous Substance ha s come to be located in, on, under or
about the Premises, o ther than a s previousl y cons ented t o by Lessor , Lessee shal l immedi ately give written notice of su ch fact to Lessor, an d provi de Lessor wi th a
copy of any report, notice, claim or other documentation which it has concerning the presence of such Hazardous Substance.
(c) Lessee Remediation. Lessee shall not cause or permit any Hazardous Substance to be spilled or released in, on, under, or about the Premises
(including through the plumbing or sanitary sewer system) and shall promptly, at Lessee's expense, comply with all ApplicableRequirements and take all
investigatory and/or remedial action reasonably recommended, whether or not formally ordered or required, for the cleanup of any contamination of, and for the
maintenance, security and/or monitoring of the Premises or neighboring properties, that was caused or materially contributed to by Lessee, or pertaining to or
involving any Hazardous Substance brought onto the Premises during the term of this Lease, by or for Lessee, or any third party.
(d) Lessee Indemnification. Lessee shall indemnify, defend and hold Lessor, its agents, employees, lenders and ground lessor, if any, harmless from
and against any and all loss of rents and/or damages, liabilities, judgments, claims, expenses, penalties, and attorneys' and consultants' fees arising out of or
involving any Haza rdous Su bstance brought onto t he Premi ses by or for Lesse e, or a ny third part y (provid ed, how ever, that L essee shall have no liability under this
Lease with respect to underground migration of any Hazardous Substance under the Premises from adjacent properties not caused or contributed to by Lessee).
Lessee's obligations shall include, but not be limited to, the effects of any contamination or injury to person, property or the environment created or suffered by
Lessee, and the cost of investigation, removal, remediation, restoration and/or abatement, and shall survive the expiration or termination of this Lease. No
termination, cancellation or release agreement entered into by Lessor and Lessee shall release Lessee from its obligations under this Lease with respect to
Hazardous Substances, unless specifically so agreed by Lessor in writing at the time of such agreement.
(e) Lessor Indemnification. Lessor and its successors and assigns shall indemnify, defend, reimburse and hold Lessee, its employees and lenders,
harmless from and against any and all environmental damages, including the cost of remediation, which result from Hazardous Substances which existed on the
Premises prior to Lessee's occupancy or which are caused by the gross negligence or will ful misconduct of Lessor, its agents or employees. Lessor's obligations, as
and when required by the Applicable Requirements, shall include, but not be limited to, the cost of investigation, removal, remediation, restoration and/or
abatement, and shall survive the expiration or termination of this Lease.
(f) Investigations and Remediations. Lessor shall retain the responsibility and pay for any investigations or remediation measures required by
governmental entities havingjurisdiction with respect to the existence of Hazardous Substances on the Premises prior to Lessee's occupancy, unless such
remediation measure is required as a result of Lessee's use (including 'Alterations', as defined in paragraph 7.3(a) below) of the Premises, in which event Lessee
shall be responsible for such payment. Lessee shall cooperate fully in any such activities at the request of Lessor, including allowing Lessor and Lessor's agents to
have reasonable access to the Premises at reasonable times in order to carry out Lessor's investigative and remedial responsibilities.
(g)
Lessor Termination Option. If a Hazardous Substance Condition (see Paragraph 9.1(e)) occurs during the term of this Lease, unless Lessee is
legally responsible therefor (in which case Lessee shall make the investigation and remediation thereof required by the Applicable Requirements and this Lease shall
continu e in full force and eff ect, but subje ct to Lessor's ri ghts under Paragraph 6.2(d) and Paragraph 13), Le ssor may, at Lessor's option, either (i) investigate and
remediate such Hazardous SubstanceCondition, if required, as soon as reasonably possible at Lessor's expense, in which event this Lease shall continue in full
force and effect, or (ii) if the estimated cost to remediate such condition exceeds 12 times the then monthly Base Rent or $100,000, whichever is greater, give
written notice to Lessee, within 30 days after receipt by Lessor of knowledge of the occurrence of such Hazardous Substance Condition, of Lessor's desire to
terminate this Lease as of the date 60 days following the date of such notice. In the event Lessor elects to give a termination notice, Lessee may, within 10 days
thereafter, give written notice to Lessor of Lessee's commitment to pay the amount by which thecost of the remediation of such Hazardous Substance Condition
exceeds an amount equal to 12 times the then monthly Base Rent or $100,000, whichever is greater. Lessee shall provide Lessor with said funds or satisfactory
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assurance thereof within 30 days following such commitment. In such event, this Lease shall continue in full force and effect, and Lessor shall proceed to make
such remediation as soon as reasonably possible after the required funds are available. If Lessee does not give such notice andprovide the required funds or
assurance thereof within the time provided, this Lease shall terminate as of the date specified in Lessor's notice of termination.
6.3 Lessee's Compliance with Applicable Requirements. Except as otherwise provided in this Lease, Lessee shall, at Lessee's sole expense, fully,
diligently and in a timely manner, materially comply with all Applicable Requirements, the requirements of any applicable fire insurance underwriter or rating
bureau, and the recommendations of Lessor's engineers and/or consultants which relate in any manner to the such Requirements, without regard to whether such
Requirements are now in effect or become effective after the Start Date. Lessee shall, within 10 days after receipt of Lessor's written request, provide Lessor with
copies of all permits and other documents, and other information evidencing Lessee's compliance with any Applicable Requirements specified by Lessor, and shall
immediately upon receipt, notify Lessor in writing (with copies of any documents involved) of any threatened or actual claim, notice, citation, warning, complaint or
report pertaining to or involving the failure of Lessee or the Premises to comply with any Applicable Requirements.
6.4 Inspection; Compliance. Lessor and Lessor's "Lender" (as defined in Paragraph 30) and consultants shall have the right to enter into Premises at
any time, in the case of an emergency, and otherwise at reasonable times after reasonable notice, for the purpose of inspecting the condition of the Premises and
for verifying compliance by Lessee with this Lease. The cost of any such inspections shall be paid by Lessor, unless a violation of Applicable Requirements, or a
Hazardous Substance Condition (see paragraph 9.1) is found to exist or be imminent, or the inspection is requested or ordered by a governmental authority. In
such case, Lessee shall upon request reimburse Lessor for the cost of such inspection, so long as such inspection is reasonably related to the violation or
contamination. In addition, Lessee shall provide copies of all relevant material safety data sheets (MSDS) to Lessor within 10 days of the receipt of a written
request therefor.
7. Maintenance; Repairs, Utility Installations; Trade Fixtures and Alterations.
7.1 Lessee's Obligations.
(a) In General. S ubject to t he provisi ons of Paragrap h 2.2 (Condi tion), 2 .3 (Compliance), 6.3 (Lessee's Compliance with Applicable Requirements), 7.2
(Lessor's Obligations), 9 (Damage or Destruction), and 14 (Condemnation), Lessee shall, at Lessee's sole expense, keep the Premises, Utility Installations (intended
for Lessee's exclusive use, no matter where located), and Alterations in good order, condition and repair (whether or not the portion of the Premises requiring
repairs, or the means of repairing the same, are reasonably or readily accessible to Lessee, andwhether or not the need for such repairs occurs as a result of
Lessee's use, any prior use, the elements or the age of such portion of the Premises), including, but not limited to, all equipment or facilities, such as plumbing,
HVAC equipment, electrical, lighting facilities, boilers, pressure vessels, fire protection system, fixtures, walls (interior and exterior), foundations, ceilings, roofs,
roof drainage systems, floors, windows, doors, plate glass, skylights, landscaping, driveways, parking lots, fences, retaining walls, signs, sidewalks and parkways
located in, on, or adjacent to the Premises. Lessee, in keeping the Premises in good order, condition and repair, shall exercise and perform good maintenance
practices, specifically including the procurement and maintenance of the service contracts required by Paragraph 7.1(b) below. Lessee's obligations shall include
restorations, replacement s or renewals when necessary to keep the Premises and all improvements thereon or a part thereof in good order, condition and state of
repair. Le ssee sha ll, during t he term of this Lease, kee p the exterior appearance of the Buil ding in a first-clas s conditi on (includi ng, e.g. graffiti removal) co nsistent
with the exterior appearance of other similar facilities of comparable age and size in the vicinity, including, when necessary, the exterior repainting of the Building.
(b) Service Contracts. Less ee shall, at Lesse e's sole expen se, procure and mai ntain cont racts, with co pies to Lessor, i n customary form an d substance
for, and with contractors specializing and experienced in the maintenance of the following equipment and improvements, if any, if and when installed on the
Premises: (i) HVAC equipment, (ii) boiler, and pressure vessels, (iii) fire extinguishing systems, including fire alarm and/or smoke detection, (iv) landscaping and
irrigation systems, (v) roof covering and drains, (vi) clarifiers (vii) basic utility feed to the perimeter of the Building, and (viii) any other equipment, if reasonably
require d by Lessor . Howev er, Lessor reserves t he right , upon notice t o Lessee , to proc ure and maintain a ny or all of such service contracts , and i f Lessor so elect s,
Lessee shall reimburse Lessor, upon demand, for the cost thereof.
(c) Failure to Perform. If Lessee fails to perform Lessee's obligations under this Paragraph 7.1, Lessor may enter upon the Premises after 10 days'
prior written notice to Lessee (except in the case of an emergency, in which case no no tice shall be required), perform such obligations on Lessee's behalf, and put
the Premises in good order, condition and repair, and Lessee shall promptly pay to Lessor a sum equal to 115% of t he cost the reof.
(d) Replacement. Subj ect to Lessee's indemnification of Lessor as set forth in Paragraph 8.7 below, and without relieving Lessee of liability resulting from Lessee's
failure to exercise and perform good maintenance practices, if an item described in Paragraph 7.1(b) cannot be repaired other than at a cost which is in excess of
50% of t he co st o f repl aci ng s uc h it e m, the n s uc h it em shal l be r epl ac ed by Lesso r , and t he co st thereo f shall be p rorat ed bet ween the Parties and Lessee shall onl y
be obligated to pay, each month during the remainder of the term of this Lease, on the date on which Base Rent is due, an amount equal to the product of
multiplying the cost of such replacement by a fraction, the numerator of which is one, and the denominator of which is 144 (ie. 1/144th of the cost per month).
Lessee shall pay interest on the unamortized balance at a rate that is commercially reasonable in the judgment of Lessor's accountants. Lessee may, however,
prepay its obligation at anytime.
7.2 Lessor's Obligations. Subject to the provisions of Paragraphs 2.2 (Condition), 2.3 (Compliance), 9 (Damage or Destruction) and 14
(Condemnation), it is intended by the Parties hereto that Lessor have no obligation, in any manner whatsoever, to repair and maintain the Premises, or the
equipment therein, all of which obligations are intended to be that of the Lessee. It is the intention of the Parties that the terms of this L ease go vern t he resp ective
obligations of the Parties as to maintenance and repair of the Premise s, and they expr essl y waiv e the bene fit o f any st atute now or hereafter in effect to the extent
it is inconsistent with the terms of this Lease.
7.3 Utility Installations; Trade Fixtures; Alterations.
(a) Definitions. The term 'Utility Installations' refers to all floor and window coverings, air and/or vacuum lines, power panels, electrical distribution,
security and fire protection systems, communication cabling, lighting fixtures, HVAC equipment, plumbing, and fencing in or on the Premises. The term "Trade
Fixtures" shall mean Lessee's machinery and equipment that can be removed without doing material damage to the Premises. The term "Alterations" shall mean
any modification of the improvements, other than Utility Installations or Trade Fixtures, whether by addition or deletion. 'Lessee Owned Alterations and/or Utility
Installations' are defined as Alterations and/or Utility Installations made by Lessee that are not yet owned by Lessor pursuant to Paragraph 7.4(a).
(b) Consent. Lessee shall not make any Alterations or Utility Installations to the Premises without Lessor's prior written consent. Lessee may, however,
make non-structural Utility Installations to the interior of the Premi ses (excluding the roof) without such consent but upon notice to Lessor, as long as they are not
visible from the outside, do not involve puncturing, relocatingor removing the roof or any existing walls, will not affect the electrical, plumbing, HVAC, and/or life
safety systems, and the cumulative cost thereof during this Lease as extended does not exceed a sum equal to 3 month's Base Rent in the aggregate or a sum
equal to one month's Base Rent in any one year. Notwithstanding the foregoing, Lessee shall not make or permit any roof penetrations and/or install anything on
the roof without the prior written approval of Lessor. Lessor may, as a precondition to granting such approval, req uire Lessee to utilize a contractor chosen and/or
approved by Lessor. Any Alterations or Utility Installations that Lessee shall desire to make and which require the consent of the Lessor shall be presented to Lessor
in written form with detailed plans. Consent shall be deemed conditioned upon Lessee's: (i) acquiring all applicable governmental permits, (ii) furnishing Lessor with
copies of both the permits and the plans and specifications prior to commencement of the work, and (iii) compliance with all conditions of said permits and other
Applicable Requirements in a prompt and expeditious manner. Any Alterations or Utility Installations shall be performed in a workmanlike manner with good and
sufficient materials. Lessee shall promptly upon completion furnish Lessor with as-built plans and specifications. For work which costs an amount in excess of one
month's Base Rent, Lessor may condition its consent upon Lessee providing a lien and completion bond in an amount equal to 150% of the estimated cost of su ch
Alteration or Utility Installation and/or upon Lessee's posting an additional Security Deposit with Lessor.
(c) Lien s; Bonds. Lessee shall pay, when due, all clai ms for labor or materials furnished or allege d to have be en fu rnishe d to or fo r Lesse e at or for use
on the Pr emi ses , whi c h cl ai ms a re o r may be s ec ured by any mechani c's o r materi alm en' s l ien agai nst t he Pr emi s es or any interest ther ei n. Le ss ee s hal l gi ve L essor
not less than 10 days notice prior to the commencement of any work in, on or about the Premises, and Lessor shall have the right to post notices of non-
responsibility. If Lessee shall contest the validity of any such lien, claim or demand, then Lessee shall, at its sole expense def end and prote ct itself, Lesso r and the
Premises against the same and shall pay and satisfy any such adverse judgment that may be rendered thereon before the enforceme
nt thereof. If Lessor shall
require , Less ee s h al l furni sh a s ur ety bo nd i n a n amount e qual t o 1 50 % o f the amo unt of suc h co nt est e d li e n, clai m o r demand, indemnifying Lessor against liability
for the same. If Lessor elects to participate in any such action, Lessee shall pay Lessor's attorneys' fees and costs.
7.4 Ownership; Removal; Surrender; and Restoration.
(a) Ownership. Subject to Lessor's right to require removal or elect ownership as hereinafter provided, all Alterations and Utility Installations made by
Lessee shall be t he property of Lessee, but consi dered a part of the Pr emises. Lessor may , at any tim e, elect i n writing to be the owner of all or any specified part
of the Lessee Owned Alterations andUtility Installations. Unless otherwise instructed per paragraph 7.4(b) hereof, all Lessee Owned Alterations and Utility
Installations shall, at the expiration or termination of this Lease, become the property of Lessor and be surrendered by Lessee with the Premises.
(b) Removal. By delivery to Lessee of written notice from Lessor not earlier than 90 and not later than 30 days prior to the end of the term of this
Lease, Lessor may require that any or all Lessee Owned Alterations or Utility Installations be removed by the expiration or termination of this Lease. Lessor may
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require the removal at any time of all or any part of any Lessee Owned Alterations or Utility Installations made without the required cons ent .
(c) Surrender; Restoration. Lessee shall surrender the Premises by the Expiration Date or any earlier termination date, with all of the improvements,
parts and surfaces thereof broom clean and free of debris, and in good operating order, condition and state of repair, ordinary wear and tear excepted. 'Ordinary
wear and tear' s hall not include any dama ge or deterioration that would have been prev ented by good maintenance practice. Notwithstanding t he foregoin g, if this
Lease is for 12 months or less, then Lessee shall surrender the Premises in the same condition as delivered to Lessee on the Start Date with NO allowance for
ordinary w ear and tear. Lessee s hall repair a ny damage occ asioned by the installation, maintenance or removal of Trade Fixtures, Lessee owned Alterations and/or
Utility Installations, furnishings, and equipment as well as the removal of any storage tank installed by or for Lessee. Lessee shall completely remove from the
Premises any and all Hazardous Substances brought onto the Premises by or for Lessee, or any third party (except Hazardous Substances which were deposited via
undergro und migrat ion from areas outsi de of the Premi ses, or if applicabl e, the Project) ev en if such removal wo uld require Les see to perform or pay for work that
exceeds stat utory require ments. Trade Fi xtures shall remai n the propert y of Lessee and shal l be removed by Les see. Any personal property of Lessee not remov ed
on or before the Expiration Date or any earlier termination date shall be deemed to have be en abandoned b y Lessee and may be disposed of or retained by Lessor
as Lessor may desire. The failure by Lessee to timely vacate the Premises pursuant to this Paragraph 7.4(c) without the express written consent of Lessor shall
constitute a holdover under the provisions of Paragraph 26 below.
8. Insurance; Indemnity.
8.1 Payment For Insurance. Lessee shall pay for all insurance required under Paragraph 8 except to the extent of the cost attributable to liability
insurance carried by Lesso r under Paragraph 8.2(b) in excess of $2,000,000 per occurrence. Premiums for policy periods commencing prior to or ext ending beyo nd
the Lease term shall be prorated to correspond to the Lease term. Payment shall be made by Lessee to Lessor wi thin 10 days following receipt of an invoice.
8.2 Liability Insurance.
(a) Carried by Lessee. Lessee shall obtain and keep in force a Commercial General Liability policy of insurance protecting Lessee and Lessor as an
additio nal i nsure d agai nst cl aim s fo r bodi ly inju ry, p er so nal i njury a nd pr opert y da mag e ba sed upon or arisin g o ut o f t he ow nership, use, o ccupancy or maintenance
of the Premises and all areas appurtenant thereto. Such insurance shall be on an occurrence basis providing single limit coverage in an amount not less than
$1,000,000 per occurrence with an annual aggregate of not less than $2,000,000, an 'Additional Insured-Managers or Lessors of Premises Endorsement' and
contain the 'Amendment of the Pollution Exclusion Endorsement' for damage caused by heat, smoke or fumes from a hostile fire. The policy shall not contain any
intra-insured exclusions as between insured persons or organizations, but shall include coverage for liability assumed under this Lease as an 'insured contract' for
the performance of Lessee's indemnity obligations under this Lease. The limits of said insurance shall not, however, limit the liability of Lessee nor relieve Lessee of
any obligation hereunder. All insurance carried by Lessee shall be primary to and not contributory with any similar insurance carried by Lessor, whose insurance
shall be considered excess insurance only.
(b) Carried by Lessor. Lessor shall maintain liability insurance as described in Paragraph 8.2(a), in addition to, and not in lieu of, the insurance
required to be maintained by Lessee . Lessee shall not be named as an additional insured therein.
8.3 Property Insurance - Building, Improvements and Rental Value.
(a) Building and Improvements. The Insuring Party shall obtain and keep in force a policy or policies in the name of Lessor, with loss payable to
Lessor, any gro und-lesso r, and to any Len der insu ring loss o r damag e to t he Premise s. The amount o f suc h insura nce shal l be equal to the full replacement cost of
the Premises, as the same shall exist from time to time, or the amount required by any Lender, but in no event more than the commercially reasonable and
available insurable value thereof. If Lessor is the Insuring Party, however, Le ssee Owned Alterations and Utility Installations, Trade Fixtures, and Lessee's personal
property shall be insured by Lessee under Paragraph 8.4 rather than by Lessor. If the coverage is available and commercially appropriate, such policy or policies
shall insure against all risks of direct physical loss or damage (except the perils of flood and/or earthquake unless required by a Lender), including coverage for
debris removal and the enforcement of any Applicable Requirements requiring the upgrading, demolition, reconstruction or replacement of any portion of the
Premises as the result of a covered loss. Said policy or policies shall also contain an agreed valuation provision in lieu of a
ny coinsurance clause, waiver of
subrogation, and inflation guard protection causing an increase in the annual property insurance coverage amount by a factor of not less than the adjusted U.S.
Department of Labor Consumer Price Index for All Urban Consumers for the city nearest to where the Premises are located. If such insurance coverage has a
deductible clause, the deductible amount shall not exceed $1,000 per occurrence, and Lessee shall be liable for such deductible amount in the event of an Insured
Loss.
(b) Rental Value. The Insuring Party shall obtain and keep in force a policy or policies in the name of Lessor with loss payable to Lessor and any
Lender, insuring the loss of the full Rent for one year with an extended period of indemnity for an additional 180 days ('Rental Value insurance'). Said insurance
shall contain an agreed valuation provision in lieu of any coinsurance clause, and the amount of coverage shall be adjusted annually to reflect the projected Rent
otherwise payable by Lessee, for the next 12 month period. Lessee shall be liable for any deduct ible amount in the event of such loss.
(c) Adjacent Premises. If t he Pre mise s are pa rt o f a larger bui ldi n g, or o f a gro up of buildings owned by Lessor which are adjacent to the Premises, t he
Lessee shall pay f or any increase in the premiums for the property insur anc e o f su ch b ui lding or buildings if said increase is caused by Lessee's acts, omissions, use
or occupancy of the Premises.
8.4 Lessee's Property; Business Interruption Insurance.
(a) Property Damage. Lessee shall obtain and maintain insurance coverage on all of Lessee's personal property, Trade Fixtures, and Lessee Owned
Alterations and Utility Installations. Such insurance shall be full replacement cost coverage with a deductible of not to exceed $1,000 per occurrence. The proceeds
from any such insurance shall be used by Lessee for the replacement of personal property, Trade Fixtures and Lessee Owned Alterations and Utility Installations.
Lessee shall provide Lessor with written evidence that such insurance is in force.
(b) Business Inte rruption. Lessee shall obtain and maintain loss of income and extra expense insurance in amounts as will reimburse Lessee for direct
or indirect loss of earnings attributable to all perils commonly insured a gai nst by pru de nt l ess ees i n the b usi ne ss o f Le ss ee or attributable to prevention of access to
the Premises as a result of such perils.
(c) No Representation of Adequate Cover age. Lessor makes no representation that the limits or forms of coverage of insu rance specified he rein are
adequate to cover Lessee's property, business operations or obligations under this Lease.
8.5 Insurance Policies. Insurance required herein shall be by companies duly licensed or admitted to transact business in the state where the Premises
are located, and maintaining during the policy term a 'General Policyholders Rating' of at least B+, V, as set forth in the most current issue of 'Best's Insurance
Guide', or such other rating as may be required by a Lender. Lessee shall not do or permit to be done anything which invalidates the required insurance policies.
Lessee shall, prior to the Start Date, deliver to Lessor certified copies of policies of such insurance or certificates evidencing the existence and amounts of the
required insurance. No such policy shall be cancelable or subject to modification except after 30 days prior written notice to Lessor. Lessee shall, at least 30 days
prior to the expiration of such policies, furnish Lessor with evidence of renewals or 'insurance binders' evidencing renewal thereof, or Lessor may order such
insuran ce and charge th e cost there of to Lessee, which amount shall be payabl e by Lessee t o Lessor upo n demand. S uch poli cies shall be for a term of at least one
year, or the length of the remaining term of this Lease, whichever is less. If either Party shall fail to procure and maintain t h e insu ran ce r eq uire d t o be carri ed by it ,
the other Party may, but shall not be required to, procure and maintain the same.
8.6 Waiver of Subrogation. Without affecting any other rights or remedies, Lessee and Lessor each hereby release and relieve the other, and waive
their entire right to recover damages against the other, for loss of or damage to its property arising out of or incident to the perils required to be insured against
herein. Theeffect of such releases and waivers is not limited by the amount of insurance carried or required, or by any deductibles applicable hereto. The Parties
agree to have their respective property damage insurance carriers waive any right to subrogation that such companies may have against Lessor or Lessee, as the
case may be, so long as the insurance is not invalidated thereby.
8.7 Indemnity. Except for Lessor's gross negligence or willful misconduct, Lessee shall indemnify, protect, defend and hold harmless the Premises,
Lessor and i t s agent s, Les sor's master or gro un d les sor, partners and L e nd ers , from and against any an d al l cl aims, l oss o f r ents and/or dama ge s, l ien s, j udgments ,
penalties, attorneys' and consultants' fees, expenses and/or liabilities arising out of, involving, or in connection with, the
use and/or occupancy of the Premises by
Lessee. If any action or proceeding is brought against Lessor by reason of any of the foregoing matters, Lessee shall upon notice defend the same at Lessee's
expense by counsel reasonably satisfactory to Lessor and Lessor shall cooperate with Lessee in such defense. Lessor need not have first paid any such claim in
order to be defended or indemnified.
8.8 Exemption of Lessor from Liability. Lessor shall not be liable for injury or damage to the person or goods, wares, merchandise or other property
of Lessee, Lessee's employees, contractors, invitees, customers, or any other person in or about the Premises, 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, fire sprinklers, wires, appliances,
plumbing, HVAC or lighting fixtures, or from any other cause, whether the said injury or damage results from conditions arising upon the Premises or upon other
portio ns of the bui ldi ng of whic h the Premise s are a part , or from o ther sourc es or place s. Les sor shall not be li able for any damages arisi ng from any act or negl ect
of any other tenant of Lessor nor from the failure of Lessor to enforce the provisions of any other lease in the Project. Notwithstanding Lessor's negligence or
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breach of this Lease, Lessor shall under no circumstances be liable for injury to Lessee's business or fo r any loss of income or profit therefro m.
8.9 Failure to Provide Insurance. Lessee acknowledges that any failure on its part to obtain or maintain the insurance required herein will expose
Lessor to risks and potentially cause Lessor to incur costs not contemplated by this Lease, the extent of which will be extremely difficult to ascertain. Accordingly,
for any month or portion thereof that Lessee does not maintain the required insurance and/or does not provide Lessor with the required binders or certificates
evidencing the existence of the required insurance, the Base Rent shall be automatically increased, without any requirement for notice to Lessee, by an amount
equal to 10% of the then existing Base Rent or $100, whichever is greater. The parties agree that such increase in BaseRent represents fair and reasonable
compensation for the additional risk/ costs that Lessor will incur by reason of Lessee's failure to maintain the required insurance. Such increase in Base Rent shall in
no event constitute a waiver of Lessee's Default or Breach with respect to the failure to maintain such insurance, prevent the exercise of any of the other rights and
remedies granted hereunder, nor relieve Lessee of its obligation to maintain the insurance specified in this Lease.
9. Damage or Destruction.
9.1 Definitions.
(a) "Premises Partial Damage" shall mean damage or destruction to the improvements on the Premises, other than Lessee Owned Alterations and
Utility Installations, which can reasonably be repaired in 6 months or less from the date of the damage or destruction. Lessor shall notify Lessee in writing within 30
days from the date of the damage or destruction as to whether or not the damage is Partial or Total.
(b) "Premises Total Destruction" shall mean damage or destruction to the Premises, other than Lessee Owned Alterations and Utility Installations and
Trade Fixtures, which cannot reasonably be repaired in 6 months or less from the date of the damage or destruction. Lessor shall notify Lessee in writing within 30
days from the date of the damage or destruction as to whether or not the damage is Partial or Total.
c) "Insured Loss" shall mean damage or destruction to improvements on the Premises, other than Lessee Owned Alterations and Utility Installations
and Trade Fixtures, which was caused by an event required to be covered by the insurance described in Paragraph 8.3(a), irrespective of any deductible amounts or
coverage limits involved.
(d) "Replacement Cost" shall mean the cost to repair or rebuild the improvements owned by Lessor at the time of the occurrence to their condition
existing immediately prior thereto, including demolition, debris removal and upgrading required by the operation of Applicable Requirements, and without deduction
for depreciation.
(e) "Hazardous Substance Condition" shall mean the occurrence or discovery of a condition involving the presence of, or a contamination by, a
Hazardous Substance as defined in Paragraph 6.2(a), in, on, or under the Premises which requires repair, remediation, or restoration.
9.2 Partial Damage - Insured Loss. If a Premises Partial Damage that is an Insured Loss occurs, then Lessor shall, at Lessor's expense, repair such
damage (but not Lessee's Trade Fixtures or Lessee Owned Alterations and Utility Installations) as soon as reasonably possible and this Lease shall continue in full
force and effect; provided, however, that Lessee shall, at Lessor's election, make the repair of any damage or destruction the total cost to repair of which is
$10,000 or less, and, in such event, Lessor shall make any applicable insurance proceeds available to Lessee on a reasonable basis for that purpose.
Notwithstanding the foregoing, if the required insurance was not in for ce or the insurance proceeds are not sufficient to effect such repair, the I nsuring Party shal l
promptly contribute the shortage in proceeds (except as to thedeductible which is Lessee's responsibility) as and when required to completesaid repairs. In the
event, however, such shortage was due to the fact that, by reason of the unique nature of the improvements, full replacement cost insurance coverage was not
commercially reasonable and available, Lessor shall have no obligation to pay for the shortage in insurance proceeds or to fully restore the unique aspects of the
Premises unless Lessee provides Lessor with the funds to cover same, or adequate assurance thereof, within 10 days following receipt of written notice of such
shortage and request therefor. If Lessor receives said funds or adequate assurance thereof within said 10 day period, the par ty responsible for making the repair s
shall complete them as soon as reasonably possible and this Lease shall remain in full force and effect. If such funds or assurance are not received, Lessor may
nevertheless elect by written notice to Lessee within 10 days thereafter to: (i) make such restoration and repair as is commercially reasonable with Lessor paying
any shortage in proceeds, in which case this Lease shall remain in full force and effect, or (ii) have this Lease terminate 30 days thereafter. Lessee shall not be
entitled to reimbursement of any funds contributed by Lessee to repair any such damage or destruction. Premises Partial Damage due to flood or earthquake shall
be subject to Paragraph 9.3, notwithstanding that there may be some insurance coverage, but the net proceeds of any such insurance shall be made available for
the repairs if made by either Party.
9.3 Partial Damage - Uninsured Loss. If a Premises Partial Damage that is not an Insured Loss occurs, unless caused by a negligent or willful act of
Lessee (in which event Lessee shall make the repairs at Lessee's expense), Lessor may either: (i) repair such damage as soon as reasonablypossible at Lessor's
expense, in which event this Lease shall continue in full force and effect, or (ii) terminate this Lease by giving written notice to Lessee within 30 days after receipt
by Lessor o f knowledge o f the occurrence o f such dama ge. Such termina tion shall be effective 60 days fo llowing the da te of such notice. In t he event Lesso r elect s
to terminate this Lease, Lessee shall have the right within 10 days after receipt of the termination notice to give written notice t o Lessor of Lessee 's commi tment to
pay for t he repai r of su ch da mage w itho ut reim bursem ent f rom L essor. L essee shall prov ide L essor wit h said fund s or sat isfa ctory assura nc e the reof within 30 day s
after making such commitment. In such event this Lease shall continue in full force and effect, and Lessor shall proceed to make such repairs as soon as reasonably
possible after the required funds are available. If Lessee does not make the required commitment, this Lease shall terminate as of the date specified in the
termination notice.
9.4 Total Destru ction. Notwithstanding any other provision hereof, if a Premises Total Destruction occurs, this Lease shall terminat e 60 days following
such Destruction. If the damage or destruction was caused by the gross negligence or willful misconduct of Lessee, Lessor shall have the right to recover Lessor's
damages from Lessee, except as provided in Paragraph 8.6.
9.5 Damage Near End of Term. If at anytime during the last 6 months of this Lease ther e is damage for which the cost to repair exceeds one month's
Base Rent , whet her or no t an I nsured Loss, Lessor m ay termi nate this Lease eff ective 60 days fo llowing the dat e of occ urrence of such damage by giving a written
termination notice to Lessee within 30 days after the date of occurrence of such damage. Notwithstanding the foregoing, if Lessee at that time has an exercisable
option to extend this Lease or to purchase the Premises, then Lessee may preserve this Lease by, (a) exercising such option and (b) providing Lessor with any
shortag e in insura nce proceeds (o r adequate assurance t hereof) ne eded to mak e the rep airs on or b efore the earlier of (i) the date which is 10 days after Lessee's
receipt of Lessor's written notice purporting to terminate this Lease, or (ii) the day prior to the date upon which such option expires. If Lessee duly exercises such
option during such period and provides Lessor with funds (or adequate assurance thereof) to cover any shortage in insurance proceeds, Lessor shall, at Lessor's
commercially reasonable expense, repair such damage as soon as reasonably possible and this Lease shall continue in full force and effect. If Lessee fails to
exercise such option and provide such funds or assurance during such period, then this Lease shall terminate on the date specified in the termination notice and
Lessee's option shall be extinguish ed.
9.6 Abatement of Rent; Lessee's Remedies.
(a) Abatement. In the event of Premises Partial Damage or Premises Total Destruction or a Hazardous Substance Condition for which Lessee is not
responsible under this Lease, the Rent payable by Lessee for the period required for the repair, remediation or restoration of such damage shall be abated in
proportion to the degree to which Lessee's use of the Premises is impaired, but not to exceed the proceeds received from the Rental Value insurance. All other
obligations of Lessee hereunder shall be performed by Lessee, and Lessor shall have no liability for any such damage, destruction, remediation, repair o r restorati on
except as provided herein.
(b) Remedies. If Lessor shall be obligated to repair or restore the Premises and does not commence, in a substantial and meaningful way, such repair
or restoration within 90 days after such obligation shall accrue, Lessee may, at any time prior to the commencement of such repair or restoration, give written
notice to Lessor and to any Lenders of which Lessee has actual notice, of Lessee's election to terminate this Lease on a date not less than 60 days following the
giving of such notice. If Lessee gives such notice and such repair or restoration is not commenced within 30 days thereafter, this Lease shall terminate as of the
date speci fi ed i n s ai d no ti ce. I f the repair or restoration is commenced within such 30 days, this Lease shall continue in full force and effect. 'Commen ce' shall m ean
either the unconditional authorization of the preparation of the required plans, or the beginning of the actual work on the Premises, whichever first occurs.
9.7 Termination; Advance Payments. Upon termination of this Lease pursuant to Paragraph 6.2(g) or Paragraph 9, an equi table adjustment shall be
made concerning advance Base Rent and any other advance payments made by Lessee to Lessor. Lessor shall, in addition, return to Lessee so much of Lessee's
Security Deposit as has not been, or is not then required to be, used by Lessor.
9.8 Waive Statutes. Lesso r and Lessee agr ee that the terms o f this Lease shall govern the effect o f any damage to o r destruction of the Premises with
respect to the termination of this Lease and hereby waive the provisions of any present or future statute to the extent inconsistent herewith.
10. Real Property Taxes.
10.1 Definition. As used herein, the term "Real Property Taxes" shall include any form of assessment; real estate, general, special, ordinary
or
extraordinary, or rental levy or tax (other than inheritance, personal income or estate taxes); improvement bond; and/or license fee imposed upon or levied
against any legal or equitable interest of Lessor in t he Pre mi s es or the P ro ject , L essor ' s ri g ht to ot her i ncome ther efro m , a nd/or Lesso r' s b usi ne ss o f leasi n g, by any
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authority having the direct or indirect power to tax and where the funds are generated with reference to the Building address and where t he pro ceeds so gene rate d
are to be applied by the city, county or other local taxing authority of a jurisdiction within which the Premises are located. Real Property Taxes shall also include any
tax, fee, levy , assessment o r charge, or any increa se therein: (i ) imposed by reaso n of events occurri ng during the term o f this Lease, including but not limited to,
a change in the ownership of the Premises, and (ii) levied or assessed on machinery or equipment pro vided by Lessor to Lessee pursuant to this Lease.
10.2 Payment of Taxes. In addition to Base Rent, Lessee shall pay to Lessor an amount equal to the Real Property Tax installment due at least 20 days
prior to the applicable delinquency date. If any such installment shall cover any period of time prior to or after the expiration or termination of this Lease, Lessee's
share of such installment shall be prorated. In the event Lessee incurs a late charge on any Rent payment, Lessor may estimate the current Real Property Taxes,
and require that such taxes be paid in advance to Lessor by Lessee monthly in advance with the payment of the Base Rent. Such monthly payments shall be an
amount equal t o t he amou nt o f the estimat ed in stall ment of t ax es divid ed by th e num ber o f mont hs r emaini ng befo re th e mo nth in which said installment becomes
delinquent. When the actual amount of the applicable tax bill is known, the amount of such equal monthly advance payments shall be adjusted as required to
provide the funds needed to pay the applicable taxes. If the amount collect ed by Lesso r is insufficie nt to pay su ch Real Prop erty Taxes when due, Lessee shall pay
Lessor, u pon demand , such additi onal sum as is ne cessary. Advan ce payment s maybe intermingl ed with other mo neys of Les sor and shall not bear interest. In the
event of a Breach by Lessee in the performance of its obligations under this Lease, thenany such advance payments may be treated by Lessor as an additional
Security Deposit.
10.3 Joint Assessment. If the Premises are not separately assessed, Lessee's liability shall be an equitable proportion of the Real Property Taxes for all
of the land and improvements included within the tax parcel assessed, such proportion to be conclusively determined by Lessor from the respective valuations
assigned in the assessor's work sheets or such other information as may be reasonably available.
10.4 Personal Property Taxes. Lessee shall pay, prior to delinquency, all taxes assessed against and levied upon LesseeOwned Alterations, Utility
Install atio ns, Trade Fi xtur es, furni sh ings, e quipme nt a nd all p ersonal propert y of L esse e. Whe n possi ble, L esse e shall caus e its Lessee Owned Alterations and Utility
Installations, Trade Fixtures, furnishings, equipment and all other personal property to be assessed and billed separately from the real property of Lessor. If any of
Lessee's said property shall be assessed with Lessor's real property, Lessee shall pay Lessor the taxes attributable to Lessee's property within 10 days after receipt
of a written statement settingforth the taxes applicable to Lessee's property.
11. Utilities and Services. Lessee shall pay for all water, gas, heat, light, power, telephone, trash disposal and other utilities and services supplied to the
Premises, together with any taxes thereon. If any such services are not separately metered or billed to Lessee, Lessee shall pay a reasonable proportion, to be
determined by Lessor, of all charges jointly metered or billed. There shall be no abatement of rent and Lessor shall not be liable in any respect whatsoever for the
inadequacy, stoppage, interruption or discontinuance of any utility or service due to riot, strike, labor dispute, breakdown, accident, repair or other cause beyond
Lessor's reasonable control or in cooperation with governmental request or directions.
12. Assignment and Subletting.
12.1 Lessor's Consent Required.
(a) Lessee shall not voluntarily or by operation of law assign,transfer, mortgage or encumber (collectively, "assign or assignment") or sublet all or any
part of Lessee's interest in this Lease or in the Premises without Lessor's prior writtenconsent.
(b) Unless Lessee is a corporation and its stock is publicly traded on a national stock exchange, a change in the control of Lessee shall constitute an
assignment requiring consent. The transfer, on a cumulative basis, of 25% or more of the voting control of Lessee shall constitute a change in control for this
purpose.
(c) The involvement of Lessee or its assets in any transaction, or series of transactions (by way of merger, sale, acquisition, financing, transfer,
leveraged buy-out or otherwise), whether or not a formal assignment or hypothecation of this Lease or Lessee's assets occurs, which results or will result in a
reduction of the Net Worth of Lessee by an amount greater than 25% of such Net Worthas it was represented at the time of the execution of this Lease or at the
time of t he mo st recent assignm ent t o which L essor h as cons ented, o r as it exists imm ediat ely prior to said t ransaction o r transacti ons co nstitu ting suc h reducti on,
whichever was or is greater, shall be considered an assignment of this Lease to which Lessor may withhold its consent. "Net Worth of Lessee" shall mean the net
worth of Lessee (excluding any guarantors) established under generally accepted accounting principles.
(d) An assignment or subletting without consent shall, at Lessor's option, be a Default curable after notice per Paragraph 13.1(c), or a noncurable Breach
without the necessity of any notice and grace period. If Lessor elects to treat such unapproved assignment or subletting as a n
oncurable Breach, Lessor may either:
(i) terminate this Lease, or (ii) upon 30 days written notice, increase the monthly Base Rent to 110% of the Base Rent then in effect . Further , in the event of such
Breach and rental adjustment, (i) the purchase price of any option to purchase the Premises held by Lessee shall be subject to similar adjustment to 110% of the
price previously in effect, and (ii) all fixed and non-fixed rental adjustments scheduled during the remainder of the Lease term shall be increased to 110% of the
scheduled adjusted rent.
(e) Lessee's remedy for any breach of Paragraph 1 2.1 by Lessor shall be limited to compensatory damages and/or injunctive relief.
12.2 Terms and Conditions Applicable to Assignment and Subletting.
(a) Regardless of Lessor's consent, no assignment or subletting shall: (I) be effective without the express written assumption by such assignee or
sublessee of the obligations of Lessee under this Lease, (ii) release Lessee of any obligations hereunder, or (iii) alter the primary liability of Lessee for the payment
of Rent or for the performance of any other obligations to be performed by Lessee.
(b) Lessor may accept Rent or performance of Lessee's obligationsfrom any person other than Lessee pending approval or disapproval of an
assignment. Neither a delay in the approval or disapproval of such assignment nor the acceptance of Rent or performance shall constitute a waiver or estoppel of
Lessor'sright to exercise its remedies for Lessee's Default or Breach.
(c) Lessor's consent to any assignment or subletting shall not constitute a consent to any subsequent assignment or subletting.
(d) In the event of any Default or Breach by Lessee, Lessor may proceed directly against Lessee, any Guarantors or anyone else responsible for the
performance of Lessee's obligations under this Lease, including any assignee or sublessee, without first exhausting Lessor's remedies against any other person or
entity responsible therefor to Lessor, or any security held by Lessor.
(e) Each request for consent to an assignment or subletting shall be in writing, accompanied by information relevant to Lessor's determination as to the
financial and operational responsibility and appropriateness of the proposed assignee or sublessee, including but not limited to the intended use and/or required
modification of the Premises, if any, together with a fee of $500 as consideration for Lessor's considering and processing said request. Lessee agrees to provide
Lessor with such other or additional information and/or documentation as may be reasonably requ ested. (See also Paragraph 36)
(f) Any assignee of, or sublessee under, this Leaseshall, by reason of accepting such assignment or entering into such sublease, be deemed to have
assumed an d agr e ed t o co nform an d co mply wit h each and ev ery t erm , c ovenant, con dit i on and o bli gati on he rei n to be obs erve d or performed by Lessee during the
term of said assignment or sublease, other than such obligations as are contrary to or inconsistent with provisions of an assignment or sublease to which Lessor
has specifically consented to in writing.
(g) Lessor's consent to any assignment or subletting shall not transfer to the assignee or sublessee any Option granted to the original Lessee by this
Lease unless such transfer is specifically consented to by Lessor in writing. (See Paragraph 39.2)
12.3 Additional Terms and Condit ions Applicable to Subletting. The fol lowing terms a nd condit ions shall apply to any subl etting by Le ssee of all or
any part of the Premises and shall be deemed included in all subleases under this Lease whether or not expressly incorporated therein:
(a) Lessee hereby assigns and transfers to Lessor all of Lessee's interest in all Rent payable on any sublease, and Lesso r may collect such Rent and
apply same toward Lessee's obligati ons under this Lease; provided, however, that until a Breach shall occur in the performance of Le ssee' s oblig atio ns, Less ee ma y
collect said Rent. In the event that the amount collected by Lessor exceeds Lessee's obligations any such excess shall be refunded to Lessee. Lessor shall not, by
reason of the foregoing or any assi gnment of such sublease, nor by reason of the collection of Rent, be deemed liable to the sublessee for any failure of Lessee to
perform and comply with any of Lessee's obligations to such sublessee. Lessee hereby irrevocably authorizes and directs any such sublessee, upon receipt of a
written notice from Lessor stating that a Breach exists in the performance of Lessee's obligations under this Lease, to pay to L esso r all Rent due and t o b ecom e d u e
under t he subleas e. Suble ssee shall rely upo n any suc h notice fr om Lesso r and shall pay al l Rents to Lessor wi thout any o bligation or right to inquire as to whether
such Breach exists, notwithstanding any claim from Lessee to the contrary.
(b) In the event of a Breach by Lessee, Lessor may, at its option, require sublessee to attorn to Lessor, in which event Lessor shall undertake the
obligations of the sublessor under such sublease from the time of the exercise of said option to the expiration of such sublease; provided, however, Lessor shall not
be liable for any prepaid rents or security deposi t paid by such sublessee to such sublessor or for any prior Defaults or Breaches of such sublessor.
(c) Any matter requiring the consent of the sublessor under a sublease shall also require the consent of Lessor.
(d) No sublessee shall further assign or sublet all or any part of the Premises without Lessor's prior written consent.
(e) Lessor shall deliver a copy of any notice of Default or Breach by Lessee to the sublessee, who shall have the right to cure the Default of
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Lessee within the grace period, if any, specified in such notice. The sublessee shall have a right of reimbursement and offset from and against Lessee for any such
Defaults cured by the sublessee.
13. Default; Breach; Remedies.
13.1 Default; Breach. A "Default" is defined as a failure by the Lessee to comply with or perform any of th e term s, co ve nant s, conditio ns o r Ru les and
Regulations under this Lease. A "Breach" is defined as the occurrence of one or more of the following Defaults, and the failure of Lessee to cure such Default within
any applicable grace period:
(a) The abandonment of the Premises; or the vacating of the Premises without providing a commercially reasonable level of security, or where the
coverage of the property insurance described i n Paragraph 8.3 is jeopardized as a result thereof, or without providing reasonable assurances to minimize potential
vandalism.
(b) The failure of Lessee to make any payment of Rent or any Security Deposit requi r ed to be made by Les see her eu n der , w h ethe r to Lessor or to a third
party, when due, to provide reasonable evidence of insurance or surety bond, or to fulfill any obligation under this Lease which endangers or threatens life or
property, where such failure continues for a period of 3 business days following written notice to Lessee.
(c) The failure by Lessee to provide (i) reasonable written evidence of compliance with Applicable Requirements, (ii) the service contracts, (iii) the
rescission of an unauthorized assignment or subletting, (iv) an Estoppel Certificate, (v) a requested subordination, (vi) evidence concerning any guaranty and/or
Guarantor, (vii) any document requested under Paragraph 42, (viii) material safety data sheets (MSDS), or (ix) any other documentation or information which
Lessor may reasonably require of Lessee under the terms of this Lease, where any such failure continues for a period of 10 days following written notice to Lessee.
(d) A D efa ult by L ess ee as t o th e t er ms, cove na nt s, co ndi t io ns or p ro vi sio ns of t hi s Lease, o r o f the r ules adopted u nd er Paragraph 40 hereof, other than
those described in subparagraphs 13.1(a), (b) or (c), above, where such Default continues for a period of 30 days after writtennotice; provided, however, that if
the nature of Lessee's Default is such that more than 30 daysare reasonably required for its cure, then it shall not be deemed to be a Breach if Lessee commences
such cure within said 30 day period and thereafter diligently prosecutes such cure to completion.
(e) The occurren ce of any of the fo llowing event s: (i) t he making of any g eneral arrange ment or assign ment fo r the be nefit of creditors; (ii) b ecoming a
"debtor" as defined in 11 U.S.C. §101 or any successor statute thereto (unless, in the case of a petition filed against Lessee, the same is dismissed within 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 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 30 days; provided, however, in the event that any
provision of this subparagraph (e) is contrary to any applicable law, such provision shall be of no force or effect, and not affect the validity of the remaining
provisions.
(f) The discovery that any financial statement of Lessee or of any Guarantor given to Lessor was materially false.
(g) If the performance of Lessee's o bligations under this Lease is guaranteed: (i) the death of a Guarantor, (ii) the termination of a Guarantor's liability
with respect to this Lease other than in accordance with the terms of such guaranty, (iii) a Guarantor's becoming insolvent or the subject of a bankruptcy filing, (iv)
a Guarantor's refusal to honor the guaranty, or (v) a Guarantor's breach of its guaranty obligation on an anticipatory basis, and Lessee's failure, within 60 days
following written notice of any such event, to provide written alternative assurance or security, which, when coupled with the then existing resources of Lessee,
equals or exceeds the combined financial resources of Lessee and the Guarantors that existed at the time of execution of this Lease.
13.2 Remedies. If Lessee fails to perform any of its affirmative duties or obligations, within 10 days after written notice (or in case of an emergency,
without notice), Lessor may, at its option, perform such duty or obligation on Lessee's behalf, including but not limited to the obtaining of reasonably required
bonds, insurance policies, or governmental licenses, permits or approvals. Lessee shall pay to Lessor an am ount equal to 115% of the co sts and ex penses incurr ed
by Lessor in such performance upon receipt of an invoice therefor. In the event of a Breach, Lessor may, with or without furthe
r notice or demand, and without
limiting Lessor in the exercise of any right or remedy which Lessor may have by reason of such Breach:
(a) Terminate Lessee's right to possession of thePremises by any lawful means, in which case this Leaseshall terminate and Lessee shall immediately
surrender possession to Lessor. In such event Lessor shall be entitled to recover from Lessee: (i) the unpaid Rent which had been earned at the time of
termination; (ii) the worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of award
exceeds the amount of such rental loss that the Lessee proves could have been reasonably avoided; (iii) the worth at the time of award of the a mo unt by w hich the
unpaid rent for the balance of the term after the time of award exceeds the amount of such rental loss that the Lessee proves could be reasonably avoided; and
(iv) any other amount necessary to compensate Lessor for all thedetriment proximately caused by the Lessee's failure to perform its obligations under this Lease
or which in the ordinary course of things would be likely to result therefrom, including but not limited to the cost of recovering possession of the Premises,
expenses of reletting, including necessary renovation and alteration of the Premises, reasonable attorneys' fees, and that portion of any leasing commission paid by
Lessor in connection with this Lease applicable to the unexpiredt erm of this Lease. The worth at the time of award of the amount referred to in provision (iii) of the
immediately preceding sentence shall be computed by discounting such amount at the discount rate of the Federal Reserve Bank of the District within which the
Premise s are located at the time of award plu s one perce nt. Efforts by L essor to mit igate damag es caused b y Lessee's B reach o f this Lease shall not waive Lessor's
right to recover damages under Paragraph 12. If termination of this Lease is obtained through the provisional remedy of unlawful detainer, Lessor shall have the
right to recov er in suc h proce eding any unpai d Rent and damages as ar e recovera ble t herei n, or L essor may res erve the ri ght to recover all or any part thereof in a
separate suit. If a notice and grace period required under Paragraph 13.1 was not previously given, a notice to pay rent or quit, or to perform or quit given to
Lessee under the unlawful detainer statute shall also constitute the notice required by Paragraph 13.1. In such case, the applicable grace period required by
Paragraph 13.1 and the unlawful detainer statute shall run concurrently, and the failure of Lessee to cure the Default within the greater of the two such grace
periods shall constitute both an unlawful detainer and a Breach of this Lease entitling Lessor to the remedies provided for in this Lease and/or by said statute.
(b) Continue the Lease and Lessee's right to possession and recover the Rent as it becomes due, in which event Lessee may sublet or assign, subject
only to reasonable limitations. Acts of maintenance, efforts to relet, and/or the appointment of a receiver to protect the Lessor's interests, shall not constitute a
termination of the Lessee's right to possession.
(c) Pursu e a ny o t her r em edy now or her eafter avai la ble un de r th e l aw s or ju di cial d ecisi on s o f the st at e where i n the Pr emi s es are locat e d. Th e exp i rati on
or termination of this Lease and/or the termination of Lessee's right to possession shall not relieve Lessee from liability under any indemnity provisions of this Lease
as to matters occurring or accruing during the term hereof or by reason of Lessee's occupancy of the Premises.
13.3 Inducement Recapture. Any agreement for free or abated rent or other charges, or for the giving or paying by Lessor to or for Lessee of any
cash or other bonus, inducement or consideration for Lessee's entering into this Lease, all of which concessions are hereinafter referred to as "Inducement
Provisions," shall be deemed conditioned upon Lessee's full and faithful performance of all of the terms, covenants and conditions of this Lease. Upon Breach of
this Lease by Lessee, any such Inducement Provision shall automatically be deemed deleted from this Lease and of no further force or effect, and any rent, other
charge, bonus, induceme nt or co nsiderati on theret ofore abat ed, giv en or paid by Le ssor u nder suc h an in ducement Provisi on shall be imm ediatel y due and pay able
by Lessee to Lessor, notwithstanding any subsequent cure of said Brea ch by Lessee. The acceptance by Lessor of rent or the cure of t he Breach which initiated the
operatio n of this paragraph s hall not be deemed a waiv er by Lessor of the provisions of this paragraph unless specifically so stated in writing by Lessor at the time
of such acceptance.
13.4 Late Charges. Lessee hereby acknowledges that late payment by Lessee of Rent 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 upon Lessor by any Lender. Accordingly, if any Rent shall not be received by Lessor within 5 days after such amount shall be due, then,
without any requirement for notice to Lessee, Lessee shall immediately pay to Lessor a one-time late charge equal to 10% of each such overdue amount or $100,
whichever is greater. The Parties hereby agree that such late charge represents a fair and reasonable estimate of the costs Lessor will incur by reason of such late
payment. Acceptance of such late charge by Lessor shall in no event constitute a waiver of Lessee's Default or Breach with respect to such overdue amount, nor
prevent t he exerci se of any of t he other ri ghts and r emedi es granted h ereunder. I n the ev ent that a lat e charge is payabl e her eunder, whether or not collected, for
3 consecutive installments of Base Rent, then notwithstanding any provision of this Lease to the contrary, Base Rent shall, at Lessor's option, become due and
payable quarterly in advance.
13.5 Interest. Any monetary payment due Lessor hereunder, other than late charges, not received by Lessor, when due as to scheduled payments
(such as Base Rent) or within 30 days following the date on which it was due for non-scheduled payment, shall bear interest from the date when due, as to
scheduled payments, or the 31st day after it was due as to non-scheduled payments. The interest ("Interest") charged shall be computed at the rate of 10% per
annum but shall not exceed the maximum rate allowed by law. Interest is payable in addition to the potential late charge provided for in Paragra ph 13.4.
13.6 Breach by Lessor.
(a) Notice of Breach. Lessor shall not be deemed in breach of this Lease unless Lessor fails within a reasonable time to perform an obligation required
to be performed by Lessor. For purposes of this Paragraph, a reasonable time shall in no event be less than 30 days after receipt by Lesso r, and any Le nder whos e
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name and address shall have been furnished Lessee in writing for such purpose, of written notice specifyingwherein such obligation of Lessor has not been
performed; provided, however, that if the nature of Lessor's obligation is such that more than 30 days are reasonably required for its performance, then Lessor
shall not be in breach if performance is commenced within such 30 day period and thereafter diligently pursued to completion.
(b) Performance by Lessee on Behalf of Lessor. In the event that neither Lessor nor Lender cures said breach within 30 days after receipt of said
notice, or if having commenced said cure they do not diligently pursue it to completion, then Lessee may elect to cure said breach at Lessee's expense and offset
from Rent the actual and reasonable cost to perform such cure, provided however, that such offset shall not exceed an amount equal to the greater of one month's
Base Rent or the Security Deposit, reserving Lessee's right to seek reimbursement from Lessor. Lessee shall document the cost of said cure and supply said
documentation to Lessor.
14. Condemnation. If the Premises or any portion thereof are taken under the power of eminent domain or sold under the threat of the exercise of said power
(collectively "Condemnation"), this Lease shall terminate as to the part taken as of the date the condemning authority takes title or possession, whichever first
occurs. If more than 10% of the Building, or more than 25% ofthat portion of the Premises not occupied by any building, is taken by Co ndemnatio n, Lessee may,
at Lessee's option, to be exercised in writing within 10 days after Lessor shall have given Lessee written notice of such taking (or in the absence of such notice,
within 10 days after the condemning authority shall have taken possession) terminate this Lease as of the date the condemning aut hority takes suc h possessi on. 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 Base Rent shall be reduced in proportion to the reduction in utility of the Premises caused by such Condemnation. Condemnation awards and/or
payments shall be t he property o f Lessor , whether such award shal l be made a s compens ation fo r diminutio n in value of th e leasehold, the valu e of the part t aken ,
or for sev erance damages; provided, ho wever, that Le ssee shall be ent itled to any compensati on for Lessee's rel ocation expe nses, loss of business goodwill and/or
Trade Fixtures, without regard to whether or not this Lease is terminated pursuant to the provisions of this Paragraph. All Alterations and Utility Installations made
to the Premises by Lessee, for purposes of Condemnation only, shall be considered the property of the Lessee and Lessee shall be entitled to any and all
compensation which is payable therefor. In the event that this Lease is not terminated by reason of the Condemnation, Lessor shall repair any damage to the
Premises caused by such Condemnation.
15. Brokerage Fees.
15.1 Additional Commission. In addition to the payments owed pursuant to Paragraph 1.9 above, and unless Lessor and the Brokers otherwise agree
in writing, Lessor agrees that: (a) if Lessee exercises any Option, (b) if Lessee acquires any rights to the Premises or other premises owned by Lessor and located
within the same Project, if any, within which the Premises is located, (c) if Lessee remains in possession of the Premises, with the consent of Lessor, after the
expiration of this Lease, or (d) if Base Rent is increased, whether by agreement or operation of an escalation clause herein, then, Lessor shall pay Brokers a fee in
accordance with the schedule of the Brokers in effect at the time of the execution of this Lease.
15.2 Assumption of Obligations. Any buyer or transferee of Lessor's interest in this Lease shall be deemed to have assumed Lessor's obligation
hereunder. Brokers shall be third party beneficiaries of the provisions of Paragraphs 1.9, 15, 22 and 31. If Lessor fails to pay to Brokers any amounts due as and
for brokerage fees pertaining to this Lease when due, then such amounts shall accrue Interest. In addition, if Lessor fails to pay any amounts to Lessee's Broker
when due, Lessee's Broker may send written notice to Lessor and Lessee of such failure and if Lessor fails to pay such amounts within 10 days after said notice,
Lessee shall pay said monies to its Broker and offset such amounts against Rent. In addition, Lessee's Broker shall be deemed to be a t hird pa rt y ben efici ary of any
commission agreement entered into by and/or between Lessor and Lessor's Broker for the limited purpose of collecting any brokerage fee owed.
15.3 Representations and Indemnities of Broker Relationships. Lessee and Lessor each represent and warrant to the other that it has had no
dealings with any person, firm, broker or finder (other than the Brokers, if any) in connection with this Lease, and that no one other than said named Brokers is
entitled to any commission or finder's fee in connection herewith. Lessee and Lessor do each hereby agree to indemnify, protect, defend and hold the other
harmless from and against liability for compensation or charges which may be claimed by any such unnamed broker, finder or other similar part y by reason of any
dealings or actions of the indemnifying Party, including any costs, expenses, attorneys' fees reasonably incurred with respect thereto.
16. Estoppel Certificates.
(a) Each Party (as "Responding Party") shall within 10 days after written notice from the other Party (the "Requesting Party")
execute, acknowledge and
deliver to the Requesting Pa rty a statement in writing in form similar to the then most current "Estoppel Certificate" form published b y the A meri can Indu strial Real
Estate Association, plus such additional information, c onfi rmati on and/o r statements as may be reasonably r equested by the Requesting Party.
(b) If the Responding Party shall fail to execute or deliver the Estoppel Certificate within such 10 day period, the Requesting Party may execute an
Estoppel Certificate stating that: (i) the 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.
Prospective purchasers and encumbrancers may rely upon the Requesting Party's Estoppel Certificate, and the Responding Party shall be estopped from denying
the truth of the facts contained in said Certificate.
(c) If Lessor desires to finance, refinance, or sell the Premises, or any part thereof, Lessee and all Guarantors shall deliver to any potential lender or
purchaser designated by Lessor such financial statements as may be reasonably required by such lender or purchaser, including but not limited to Lessee's financial
stateme nts for the past 3 year s. All suc h financial stateme nts shall b e receiv ed by Le ssor and su ch lender o r purcha ser in co nfidence and shall be used only for the
purposes herein set forth.
17. Definition of Lessor. The term "Lessor" as used herein shall mean the owner or owners at the time in question of the fee title to the Premises, or, if
this is a subleas e, of the Lessee' s interest in the pri or lease. In t he event of a transfer o f Lessor's titl e or interest in t he Premises or this Lease, Lessor shall deliver
to the transferee or assignee (in cash or by credit) any unused Security Deposit held by Lessor. Except as provided in Paragraph 15, upon such transfer or
assignm ent an d d eli very of the Se cu rit y Deposit, as aforesaid, the prior Lessor shall be relieved of all liability with respect t o the o bli gati ons an d/ o r co vena nt s und e r
this Lease t hereaft er to be performe d by the Lesso r. Subj ect to the foregoing, the obligations and/or covenants in this Lease to be performed by t he Le ssor shal l be
bindi ng only upon the Lesso r as here inabo ve defined.
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. Days. Unless otherwise specifically indicated to the contrary, the word 'days' as used in this Lease shall mean and refer to calendar days.
20. Limitation on Lia b ility. The obligations of Lessor under this Lease shall no constitute personal obligations of Lessor or its partners, members, directors,
officers or shareholders, and Lessee shall look to the Premises, and to no other assets of Lessor, for the satisfaction of any liability of Lessor with respect to this
Lease, and shall no seek recourse against Lessor's partners, members, directors, officers or shareholders, or any of their personal assets for such satisfaction.
21. Time of Essence. Time is of the essence with respect to the performance of all obligations to be performed or observed by the Parties under this Lease.
22. No Prior or Other Agreements; Broker Disclaimer. This Lease contains all agreements between the Parties with respect to any matter mentioned
herein , and no ot her prior or cont empo raneous agr eement o r understa nding s hall be effe ctive. Les sor and Le ssee each r epresen ts and warrants to the Brokers that
it has made, and is relying solely upon, its own investigationas to the nature, quality, character and financial responsibility of the other Party to this Lease and as
to the use, nature, quality and character of the Premises. Brokers have no responsibility with respect thereto or with respect to any default or breach hereof by
either Party. The liability (including court costs and attorneys' fees), of any Broker with respect to negotiation, execution, delivery or performance by either Lessor
or Lessee under this Lease or any amendment or modification hereto shall be limited toan amount up to the feereceived by such Broker pursuant to this Lease;
provided, however, that the foregoing limitation on each Broker's liability shall not be applicable to any gross negligence or willful misconduct of such Broker.
23. Notices.
23.1 Notice Requirements. All notices required or permitted by this Lease or applicable law shall be in writing and may be delivered in person (by
hand or by courier) or may be sent by regular, certified or registered mail or U.S. Postal Service Express Mail, with postage prepaid, or by facsimile transmission,
and shall be de emed sufficie ntly given if serv ed in a manner specifi ed in this Paragrap h 23. The addres ses noted adjace nt to a
Party's signat ure on this Lease sh all
be that Party's address for delivery or mailing of notices. Either Party may by written notice to the other specify a different address for notice, except that upon
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Lessee's taking possession of the Premises, the Premises shall constitute Lessee's address for notice. A copy of all notices to Lessor shall be concurrently
transmitted to such party or parties at such addresses as Lessor may from time to time hereafter designate in w riting.
23.2 Date of Notice. Any notice sent by registered or certified mail, return receipt requested, shall be deemed given on the date of delivery shown on
the receipt card, or if no delivery date is shown, the postmark thereon. If sent by regular mail the notice shall be deemed given 48 hours after the same is
addressed as required herein and mailed with postage prepaid. Notices delivered by United States Express Mail or overnight courier that guarantee next day
delivery shall be deemed given 24 hours after delivery of the same to the Postal Service or courier. Notices transmitted by facsimile transmissi on or simila r means
shall be deemed delivered upon telephone confirmation of receipt (confirmation report fro m fax machine is sufficient), provi ded a copy is also d elivered vi a deliv ery
or mail. If notice is received on a Saturday, Sunday or legal holiday, it shall be deemed received on the next business day.
24. Waivers. No waiver by Lessor of the Default or Breach of any term, covenant or condition hereof by Lessee, shall be deemed a waiver of any other
term, covenant or condition hereof, or of any subsequent Default or Breach by Lessee of the same or of any other term, covenant or condition hereof. 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 or similar act by
Lessee, or be construed as the basis of an estoppel to enforce the provision or provisions of this Lease requiring such consent. The acceptance of Rent by Lessor
shall not be a waiver of any Default or Breach by Lessee. Any payment by Lessee may be accepted byLessor on account of moneysor damages due Lessor,
notwithstanding any qualifying statements or conditions made by Lessee inconnection therewith, which such statements and/or conditions shall be of no force or
effect whatsoever unless specificall y agreed to in writing by Le ssor at or before the time of deposit of such payment.
25. Disclosures Regarding The Nature of a Real Estate Agency Relationship.
(a) When entering into a discussion with a real estate agent regarding a real estate transaction, a Lessor or Lessee should from the outset understand
what type of agency relationship or representation it has withthe agent or agents in the transaction. Lessor and Lessee acknowledge being advised by the Brokers
in this transaction, as follows:
(i)
Lessor's Agent. A Lessor's agent under a listing agreement with the Lessor acts as the agent for the Lessor only. A Lessor's agent or
subagent has the following affirmative obligations:
To the Lessor: A fiduciary duty of utmost care, integrity, honesty, and loyalty in dealings with the
Lessor.
To the Lessee and the Lessor: a. Diligent exercise of reasonable skills and care in performance of the agent's duties. b. A duty of honest and fair
dealing and good faith. c. A duty to disclose all facts known to the agent materially affecting the value or desirability of the property t hat are not known
to, or within the diligent attention and observation of, the Parties. An agent is not obligated to reveal to either Party any confidential information
obtained from the other Party which does not involve the affirmative duties set forth above.
(ii)
Lessee's Agent. An agent can a gree to act as agent for the Lessee only. In these situations, the agent is not the Lessor's agent, even if by
agreement the ag ent may rec eive compe nsation fo r servic es rende red, either in full o r in part from th e Lesso r. An age nt actin g only for a Lesse e has t he
following affirmative obligations.
To the Lessee: A fiduciary duty of utmost care, integrity, honesty, and loyalty in dealings with the Lessee.To the
Lesseeand the Lessor: a. Diligent exercise of reasonable skills and care in performance of the agent's duties. b. A duty of honest and fair dealing and
good faith. c. A duty to disclose all facts known to the agent materially affecting the value or desirability of the property that are not known to, o r within
the diligent attention and observation of, the Parties. An agent is not obligated to reveal to either Party any confidential information obtained from the
other Party which does not involve the affi rmative duties set fo rth above.
(iii)
Agent Representing Both Lessor and Lessee. A real estate agent, either actingdirectly or through one or more associate licenses, can
legally be the agent of both the Lessor and the Lessee in a transaction, but only with the knowledge and consent of both the Lessor and t he Le ssee. In a
dual agency situat ion, the agent has the following affirmative obligations to both the Lessor and th e Lessee: a. A fiduciary duty of utmost care, int egrity,
honest y and lo yalt y in t he deali ng s wit h eit her L es sor o r t he Lesse e. b. Ot her d uti es to the Les so r and t he Less ee as st at ed abo ve in sub para gra phs (i ) or
(ii). In representing both Lessor and Lessee, the agent may not without the express permission of the respective Party, disclose to the other Party that
the Lessor will accept rent in an amount less than that indicated in the listing or that the Lessee is willing to pay a higher rent than that offered. The
above duties of the agent in a real estate transaction do not relieve a Lessor or Lessee from the responsibility to protect their own intere sts. Lessor a nd
Lessee should carefully read all agreements to assure that they adequately express their understanding of the transaction. A real estate agent is a
person qualified to advise about real estate. If legal or tax advice is desired, consult a competent prof essional.
(b) Brokers have no responsibility with respect to any default or breach hereof by either Party. The liability (including court costs and att orney s' fees), of
any Broker with respect to any breach of duty, error or omission relating to this Lease shall not exceed the fee received by such Broker pursuant to this Lease;
provided, however, that the foregoing limitation on each Broker's liability shall not be applicable to any gross negligence or willful misconduct of such Broker.
(c) Lessor and Lessee agree to identify to Brokers as 'Confidential' any communication or information given Brokers that is considered by such Party to
be confident i al.
26. No Right T o Hold over. Lessee has no right to retain possession of the Premises or any part thereof beyond the expiration or termination of this Lease.
In the event that Lessee holds over, then the Base Rent shall be increased to 150% of the Base Rent applicable immediately preceding the expiration or
termination. Nothing contained herein shall be construed as consent by Lessor to any holding over by Lessee.
27. Cumulati ve Rem edies. No reme dy o r electi on her eund er shall be dee med excl usi ve but shall , wh erever possi ble, be cumul at ive wit h all o ther rem edie s
at law or in equity.
28. Covenants and Conditions; Construction of Agreement. All provisions of this Lease to be observed or performed by Lessee are both covenants and
conditions. In construing this Lease, all headings and titles are for the convenience of the Parties only and shall not be considered a part of this Lease. Whenever
required by the context, the singular shall include the plural and vice versa. This Lease shall not be construed as if prepared by one of the Parties, but rather
according to its fair meaning as a whole, as if both Parties had prepared it.
29. Binding Effect; Choice of Law. This Lease shall be binding upon the Parties, their personal representatives, successors and assigns and be governed
by the laws of the State in which the Premises are located. Any litigation between the Parties hereto concerning this Lease shall be initiated in the county in which
the Premises are located.
30. Subordination; Attornment; Non-Disturbance.
30.1 Subordination. This Lea se an d any Optio n grant ed hereby s hall be su bject and su bordi nate to any gr ound l ease , mortg age, de ed of trust , or other
hypothecation or security device (collectively, "Security Device"), now or hereafter placed upon the Premises, to any and all advances ma de o n th e se curi ty ther eo f,
and to all renewals, modifications, and extensions thereof. Lessee agrees that the holders of any such Security Devices (in this Lease together referred to as
"Lender") shall have no liability or obligation to perform any of the obligations of Lessor under this Lease. Any Lender may elect to have this Lease and/or any
Option granted hereby superior to the lien of its Security Device by giving written notice thereof to Lessee, whereupon this Lease and such Options shall be deemed
prior to such Security Device, notwithstanding the relative dates of the documentation or recordation thereof.
30.2 Attornment. In the event that Lessor transfers title to the Premises, or the Premises are acquired by another upon the foreclosure or termination
of a Security Device to which this Lease is subordinated (i) Lessee shall, subject to the non-disturbance provisions of Paragraph 30.3, attorn to such new owner,
and upon request, enter into a new lease, co ntaining all of the terms and provisions of this Lease, with such new owner for the r emainder of the term he reof, or, at
the election of such new owner, this Lease shall automatically become a new Lease between Lessee and such new owner, upon all of the terms and conditions
hereof, for the remainder of the term hereof, and (ii) Lessor shall thereafter be relieved of any further obligations hereunder and such new owner shall assume all
of Lessor's obligations hereunder, except that such new owner shall not: (a) be liable for any act or omission of any prior lessor or with respect to events occurring
prior to acquisitio n of ownership ; (b) be subj ect to any offset s or defenses which Less ee might have a gainst any prio r lessor, (c) be bo und by prepayme nt of more
than one month's rent, or (d) be liable for the return of any security deposit paid to any prior lessor.
30.3 Non-Distur bance. With respect to Security Devices entered into by Lessor after the execution of this Lease, Lessee's subordination of this Lease
shall be subject to receiving a commercially reasonable non-disturbance agreement (a "Non-Disturbance Agreement") from the Lender which Non-Disturbance
Agreement provides that Lessee's possession of the Premises, and this Lease, including any options to extend the term hereof, will not be disturbed so long as
Lessee is not in Breach hereof and attorns to the record owner of the Premises. Further, within 60 days after the execution of this Lease, Lessor shall use its
commercially reasonable efforts to obtain a Non-Disturbance Agreement from the holder of any pre-existing Security Device which is secured by the Premises. In
the event that Lessor is unable to provide the Non-Disturbance Agreement within said 60 days, then Lessee may, at Lessee's option, directly contact Lender and
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attempt to negotiate for the execution and delivery of a Non-Disturbance Agreement.
30.4 Self-Executing. The agreements contained in this Paragraph 30 shall be effective without the execution of any further documents; provided,
however, that, upon written request from Lessor or a Lender inconnection with a sale, financing or refinancing of the Premises, Lessee and Lessor shall execute
such further writings as may be reasonably required to separately document any subordination, attornment and/or Non-Disturbance Agreement provided for herein.
31. Attorneys' Fees. If any Party or Broker brings an action or proceeding involving the Premi ses whet her fou nded i n tort, cont ract o r equity , or to declare
rights hereunder, the Prevailing Party (as hereafter defined) in any such proceeding, action, or appeal thereon, shall be entitled to reasonable attorneys' fees. Such
fees may be awarded in the same suit or recovered in a separate suit, whether or not such action or proceeding is pursued to decision or judgment. The term,
"Prevailing Party" shall include, without limitation, a Party or Broker who substantially obtains or defeats the relief sought, as the case may be, whether by
compromise, settlement, judgment, or the abandonment by the other Party or Broker of its claim or defense. The attorneys' fees award shall not be computed in
accordance with any court fee schedule, but shall be such as to fully reimburse all attorneys' fees reasonably incurred. In addition, Lessor shall be entitled to
attorneys' fees, costs and expenses incurred in the preparation and service of notices of Default and consultations in connection therewith, whether or not a legal
action is subsequently commenced in connection with such Default or resulting Breach ($200 is a reasonable minimum per occurrence for such services and
consultation).
32. Lessor's Access; Showing Premises; Repairs. Lessor and Lessor's agents shall have the right to enter the Premises at anytime, in the case of an
emergency, and otherwise at reasonable times after reasonable prior notice for the purpose of showing the same to prospective purchasers, lenders, or tenants,
and making such alterations, repairs, improvements or additions to the Premises as Lessor may deem necessary or desirable and the erecting, using and
maintaining of utilities, services, pipes and conduits through the Premises and/or other premises as long as there is no material adverse effect to Lessee's use of
the Premises. Allsuch activities shall be without abatement of rent or liability to Lessee.
33. Auctions. Lessee shall not conduct, nor permit to be conducted, any auction upon the Premises without Lessor's prior written consent. Lessor shall not
be obligated to exercise any standard of reasonableness in determining whether to permit an auction.
34. Signs. Lessor may place on the Premises ordinary 'For Sale' signs at any time and ordinary 'For Lease' signs during the last 6 months of the term
hereof. Except fo r ordi nary 'fo r s ubl e ase' signs, L ess ee shall not place any sign u pon t h e Pr emis es wi t ho ut Lesso r's prio r wri tte n co ns e nt. Al l sign s mu st co mpl y wi t h
all Applicable Requirements.
35. Termination; Merger. Unless specifically stated otherwise in writing by Lessor, the voluntary or other surrender of this Lease by Lessee, the mutual
termination or cancellation hereof, or a termination hereof by Lessor for Breach by Lessee, shall automatically terminate any sublease or lesser estate in the
Premises; provided, however, that Lessor may elect to continue any one or all existing subtenancies. Lessor's failure within 10 days following any such event to
elect to the contrary by written notice to the holder of any such lesser interest, shall constitute Lessor's election to have such event constitute the termination of
such interest.
36. Consents. Except as otherwise provided herein, wherever in this Lease the consent of a Party is required to an act by or for the other Party, such
consent shall no t be unreasonably withheld or delayed. Lessor's actual reasonable costs and expenses (including but not limited to architects', attorneys', engineers'
and othe r consul tants' fe es) in curre d in the co nsiderat io n of, o r respons e t o, a request by Less ee for a ny Lesso r consent , including but not limited to consents to an
assignment, a subletting or the presence or use of a Hazardous Substance, shall be paid by Lessee upon receipt of an invoice and supporting documentation
therefor. Lessor's consent to any act, assignment or subletting shall not constitute an acknowledgment that no Default or Breach by Lessee of this Lease exists, nor
shall such consent be deemed a waiver of any then existing Default or Breach, except as may be otherwise specifically stated in writing by Lessor at the time of
such consent. The failure to specify herein any particular condition to Lessor's consent shall not preclude the imposition by Lessor at the time of consent of such
further or other co nditions as are then r easonabl e with reference to the particular matter for which consent is being given. In the eve nt that either Part y disagrees
with any d et ermi n ati o n made by the o ther he re un der and rea so nably re quests the rea sons for s uch determination, the determining
party shall furnish its reasons in
writing and in reasonable detail within 10 business days following such request.
37. Guarantor.
37.1 Execution. The Guarantors, if any, shall each execute a guaranty in the form most recently published by the American Industrial Real Estate
Association, and each such Guarantor shall have the same obligations as Lessee under this Lease.
37.2 Default. It shall constitute a Default of the Lessee if any Guarantor fails or refuses, upon request to provide: (a) evidence of the execution of the
guaranty, including the authority of the party signing on Guarantor's behalf to obligate Guarantor, and in thecase of a corporate Guarantor, a certified copy of a
resoluti on of i ts b oard of direct ors a utho rizing t he making o f su ch gua ra nty, ( b) curr ent finan cial statem ent s, (c) a n Esto ppel Certificate, or (d) written confirmation
that the guaranty is still in effect.
38. Quiet Possessio n. Subject t o payment by Lesse e of the Rent and perf ormance of all of the covenants, co nditions and prov isions on Les see's part to be
observe d and perf ormed u nd er this Lease, Le ss ee shall have quiet possession and quiet enjoyment of the Premises during the term hereof.
39. Options. If Lessee is granted an Option, as defined below, then the following provisions shall apply:
39.1 Definition. "Option" shall mean: (a) the right to extend the term of or renew this Lease or to extend or renew any lease that Lessee has on other
property of Lessor; (b) the right of first refusal or first offer to lease either the Premises or other property of Lessor; (c) the right to purchase or the right of first
refusal to purchase the Premises or other property of Lessor.
39.2 Options Personal To Original Lessee. Any Option granted to Lessee in this Lease is personal to the original Lessee, and cannot be assigned or
exercised by anyone other tha n said original Lessee and only while the original Lessee is in full possession of the Premises and, if req uested by Lessor , with Lesse e
certifying that Lessee has no intention of thereafter assigning or subletting.
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 Options have been validly exercised.
39.4 Effect of Default on Options.
(a) Lessee shall have no right to exercise an Option: (i) during the period commencing with the giving of any notice of Default and continuing until said
Default is cured, (ii) during the period of time any Rent is unpaid (without regar d to wh ether notice thereof is given Lessee), (iii) during the time Lessee is in Breach
of this Lease, or (iv) in the event that Lessee hasbeen given 3 or more notices of separate Default, whether or not the Defaults are cured, during the 12 month
period immediately preceding the exercise of the 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) An Opti on shall terminat e and be of no further fo rce or effect, no twithstandi ng Lessee's du e and timely exer cise of the Op tio n, if, after such exer cise
and prior to the commencement of the extended term or completionof the purchase, (i) Lessee fails to pay Rent for a period of 30 days after such Rent becomes
due (without any necessity of Lessor to give notice thereof), or (ii) if Lessee commits a Breach of this Lease.
40. Multiple Buildings. If the Premises are a part of a group of buildings controlled by Lessor, Lessee agrees that it will abide by and conform to all
reasonable rules and regulations which Lessor may make from time to time for the management, safety, and care of said properties, including the care and
cleanlin es s o f the grou nd s and incl udi ng t he parking, loading an d unlo a d ing o f vehicl es , a n d to cause it s em p l oy ees, s uppl i er s, shipper s, cust ome rs, cont ract ors an d
invitees to so abide and conform. Le ssee also agrees to pay its fair s hare of common expenses incurred in connection with such rules and regulations.
41. Security Measures. Lesse e h ereby acknowl ed ges t ha t t he Rent pay a ble t o Lesso r he re un d er doe s no t i nclu d e t he cost o f gu ar d ser vi ce o r ot her sec urity
measures, and that Lessor shall have no obligation whatsoever to provide same. Lessee assumes all responsibility for the protection of the Premises, Lessee, its
agents and invitees and their property from the acts of third parties.
42. Reservations. Lessor reserves to itself the right, from time to time, to grant, without the consent or joinder of Lessee, such easements, rights and
dedications that Lessor deems necessary, and to cause the recordation of parcel maps and restrictions, so long as such easements, rights, dedications, maps and
