HomeMy WebLinkAboutAdministrative Permit APX2010019 - Supporting Documents12/22/10
This letter is to notify you that Sportswear Resources dba Pure Fastpitch is
proposing to open a indoor training center for softball players at 16662-16692
Gothard Street, Huntington Beach CA.. Pursuant to Section 241.24 of the Huntington
Beach Zoning and Subdivision Ordinance, the neighborhood notification process is
1/14I LI ftrpv required. You may review the plans at the planning department, 2000 Main Street,
Huntington Beach, CA from 12/23/10 to 1/07/11 or contact the Planning
Old t'on vxm department at 714-536-5271. All comments must be submitted to the PlanningEMS 1/L of Department prior to the expiration date for review of the proposal.
O'C50 tar.
Under the provisions of the Huntington Beach Zoning subdivision Ordinance, the
action taken by the Director of Planning becomes final, unless appealed. A person
desiring to appeal the decision shall file a written notice of appeal with the Planning
Department within ten calendar days of the date of the Planning Departments
action. The notice of appeal shall include the name and address of the appellant, the
decision being appealed, and the basis for the appeal. A filing fee shall also
accompany the notice of appeal. The appeal fee is 494.00. The appeal period starts
at the end of the 10 day review period.
If you have any questions please feel free to call me at 714-720-3882.
Sincerely,
Bill Jackson DEC 232013
Huntington Beach
Cc: City of Huntington Beach Planning Department P'MIP.iG DEPT.
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Office of thWity Treasurer •i L. Freidenrich, CPA
City Treasurer
Receipt
December 23, 2010
Receipt Number 197989Bill Jackson
19105 Chandon Lane
Cashier
Batch #20101223000PC2021
Huntington Beach CA 92648
Dept. of Issuance Planning Department Amount Paid $551.00
Permit / License #20100219 Payment Method Check
Fee Amount Paid
Amount Outstanding $0.00
Admin Permit 1-Neighborhood Notification
Automation Fee
$530.00
$21.00
Questions?
Business License: (714) 536-5267
Planning & Building: (714) 536-5241
Standard Industrial/Commercial Single Tenant Lease - Gross
(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 December 14. 2010 is made by and between
Princeland Pro erties International Inc. ("Lessor") and S ortswear Resources Inc. ("Lessee"), (collectively the "Parties," or
individually a "Par ty").
1.2 Premises: That certain real property, including all improvements therein or to be provided by Lessor under the terms of this
Lease, and commonly known as 16662 -16692 Gothard Street Huntin ton Beach 92647 located in the Coun ty of Orange , State of
California. and generally described as (describe briefly the nature of the proper ty and, if applicable, the "Project ", if the prope rty is
located within a Project) a roximatel 13 265 s uare feet of Industrials ace ("Premises"). (See also paragraph 2)
1.3 Term: 3 years and 2 months ("Original Term ") commencing January 1, 2011 ("Commencement Date") and ending
February 28, 2014 ("Expiration Date"). (see also Paragraph 3)
1.4 Early Possession see addendum ara ra h 51 ("Early Possession Date"). (See also Paragraphs 3.2 and 3 3)
1.5 Base Rent $7959.00 per month ("Base Rent"), payable on the first day of each month commencing January 2011
(See also Paragraph 4)
Ixl if this box is checked, there are provisions in this Lease for the Base Rent to be adjusted and/or for common area maintenance
charges.
1.6 Rent Paid Upon Execution: $ 8097.00 as Rent for the period January 2011
1.7 Security Deposit: 9750.00 ("Securi ty Deposit"). (See also Paragraph 5)
1.8 Agreed Use: s arts trainin facili (See also Paragraph 6)
1.9 Insuring Party. Lessor is the "Insuring Party". The annual "Base Premium" is $ 1280 .00 (See also Paragraph 8)
1.10 Real Estate Brokers: (See also Paragraph 15)
(a) Representation: The following real estate brokers (collectively, the "Brokers") and brokerage relationships exist in
this transaction (check applicable boxes):
N/A represents Lessor exclusively ("Lessor's Broker");
N/A represents Lessee exclusively ("Lessee's Broker"); or
Lee & Associates - Curt Stalder represents both Lessor and Lessee ("Dual Agency")
(b) Payment to Brokers: 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.
1.11 Guarantor. Th e obligations of the Lessee under this Lease are to be guaranteed by William J. Jackson ("Guarantor").
(See also Paragraph 37)
1.12 Addenda and Exhibits . Attached hereto is an Addendum or Addenda consisting of Paragraphs 50 through 57 and
Exhibits A through D , all of which constitute a part of this Lease.
2. Premises.
2.1 Letting. Lessor hereby leases to Lessee, and Lessee hereby leases from Lessor, the Premises, for the term, at the rental,
and upon all of the terms, covenants and conditions set forth in this Lease. Unless otherwise provided herein, any statement of size set
forth in this Lease, or that may have been used in calculating rental, is an approximation which the Parties agree is reasonable and the
rental based thereon is not subject to revision whether or not the actual size is more or less
2.2 Condition, Lessor shall deliver the Premises broom clean and free of debris on the Commencement Date or the Early
Possession Date, whichever first occurs ("Start Date") (unless Lessee is already in possession). Notwithstanding anything to the
contrary contained herein, Lessor shall deliver the Premises to Lessee in an 'AS-IS' condition on the Start Date (unless Lessee is
already in possession). Lessor shall have no obligation to construct any improvements within or about the Premises or the Project
Notwithstanding the foregoing, Lessee and Lessor shall conduct a walk-through inspection of the Premises concurrently with Lessor's
delivery of the Premises to Lessee. During this walk-through, the parties shall identify any non-functioning items in the Premises that
require repair(the "Punch-List Items'). Lessor, at its sole cost, shall promptly repair the Punch-List Items. Any defects or deficiencies in
the Premises not described in the Punch-List will be deemed waived by Lessee and shall be Lessee's obligation to repair, at Lessee's
sole cost, unless Lessee delivers notice of the same to Lessor within thirty (30) days after Lessor's delive ry of the Premises to Lessee.
2.3 Compliance. Lessee is responsible for determining whether or not the zoning is appropriate for Lessee's intended use, and
acknowledges that past uses of the Premises may no longer be allowed. If the applicable laws, covenants or restrictions of record,
building codes, regulations and ordinances ("Applicable Requirements") require during the term of this Lease the construction of an
addition to or an alteration of any of the buildings on the Premises (the "Building") or the reinforcement or other physical modification of
the Building ("Capital Expenditure"), Lessor and Lessee shall allocate th e cost of such work as follows:
(a) Subject to Paragraph 2.3(c) below, if such Capital Expenditures are required as a result of the specific and unique use of the
Premises by Lessee as 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 two (2) years of this Lease and the cost thereof exceeds six (6)
months' Base Rent, Lessee may instead terminate this Lease unless Lessor notifies Lessee, in writing, within ten (10) days after receipt
of Lessee's termination notice that Lessor has elected to pay the difference between the actual cost thereof and the amount equal to six
(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 wri tten notice specifying a termination date at least ninety (90) days thereafter. Such termination date
shall, however, in no event be earlier than 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 modifications), then Lessor and Lessee shall allocate the obligation to pay for such costs pursuant to
the provisions of Paragraph 7.1 (c); provided, however, that if such Capital Expenditure is required during the last two years of this Lease
or if Lessor reasonably determines that it is not economically feasible to pay its share thereof, Lessor shall have the option to terminate
this Lease upon ninety (90) days prior written notice to Lessee unless Lessee notifies Lessor, in writing, within ten (10) days after receipt
of Lessor's termination notice that Lessee will pay for such Capital Expenditure. If Lessor does not elect to terminate, or fails to tender .is
share of any such Capital Expenditure when it is required to do so, Lessee may advance such funds and deduct same, with interest,
from Rent until Lessor's share of such costs have been fully paid. 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 thirty (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 Applicable Requirements. If the Capital Expenditures are triggered by Lessee as a result of an actual or proposed
change in use, change in intensity of use, or modification to the Premises then, and in that event, Lessee shall be fully responsible for the
cost thereof, and Lessee shall not have any right to terminate this Lease. Additionally, if the Capital Expenditures are triggered due the
failure of the Premises to comply with Applicable Requirements as of the Start Date (which is in no way related to Lessee's occupancy of
the Premises, whether before or after the Start Date), Lessor shall be solely responsible for the cost of the same.
2.4 Acknowledgments . 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 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 any Broker has made any oral or written representations or
warranties with respect to said matters other than as set forth in this Lease.
3. Term.
3.1 Term. The Commencement Date, Expiration Date and Original Term of this Lease are as specified in Paragraph 1 3-
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3.2 Early Possession essee totally or partially occupies the Premises prior to the C mencement Date, the obligation to
pay Base Rent shall be abated for the period of such early possession . All other terms of this Lease 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 commercially reasonable efforts to deliver possession of the Premises to
Lessee by the Commencement Date. If, despite said efforts. Lessor is unable to deliver possession as agreed, Lessor shall not be
subject to any liabili ty therefor, nor shall such failure affect the validi ty of this Lease. Lessee shall not, however, be obligated to pay Rent
or perform its other obligations until it receives possession of the Premises. If possession is not tendered to Lessee by the Start Date,
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 omissions of Lessee. If possession of the Premises is not delivered within four (4) months after the Commencement Date, this Lease
shall terminate unless other agreements are reached between Lessor and Lessee , in writing.
3.4 Lessee Compliance. Lessor shall not be required to tender possession of the Premises to Lessee until Lessee complies
with its obligation to provide evidence of insurance (Paragraph 8.5). Pending delivery of such evidence, 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 Lessor may elect to withhold possession until such
conditions are satisfied.
4. Rent.
4.1. Rent Defined. All moneta ry obligations of Lessee to Lessor under the terms of this Lease (except for the Secunty Deposit)
are deemed to be rent ("Rent").
4.2 Payment. Lessee shall cause payment of Rent to be received by Lessor in lawful money of the United States, without offset
or deduction (except as specifically permitted in this Lease), on or before the day on which it is due. Rent for any period during the term
hereof which is for less than one (1) 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 Lessors endorsement of any check so stating.
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 said Security Deposit, Lessee shall within ten (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 change in the business of Lessee or to accommodate a sublessee or assignee,
Lessor shall have the right to increase the Security Deposit to the extent necessary, in Lessors 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 change the financial condition of Lessee is, in Lessors reasonable judgment, significantly reduced, Lessee shall deposit
such additional monies with Lessor as shall be sufficient to cause the Security Deposit to be at a commer cially reasonable level based on
said change in financial condition. Lessor shall not be required to keep the Security Deposit separate from its general accounts. Within
fourteen (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 thirty (30) days after the Premises have been vacated pursuant to Paragraph 7.4(c) below, Lessor shall return that
portion of the Security Deposit not used or applied by Lessor . No part of the Security 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 this Lease.
6. Use.
6.1 Use. Lessee shall use and occupy the Premises only for the Agreed Use, 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 a nuisance, or that disturbs owners and/or
occupants of, or causes damage to neighboring prope rties
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 presence, use, manufacture, disposal, transportation, or release, either by itself or in combination with other
materials expected to be on the Premises, is either. (i) potentially injurious to the public health, safety or welfare, the environment or the
Premises, Cu) 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 theo ry. Hazardous Substances shall include, but not be limited to,
hydrocarbons, petroleum, gasoline, and/or crude oil or any products, by-products or fractions thereof. Lessee shall not engage in any
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 above 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 neighbo ring prope rties.
Notwithstanding the foregoing, Lessee may use any ordinary and customary materials reasonably required to be used in the normal
course of the Agreed Use, so long as such use is in compliance with all Applicable Requirements , is not a Reportable Use, and does not
expose the Premises or neighboring property to any meaningful 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 to protect itself, the public, the Premises and/or the environment against damage, contamination, injury
and/or liability, including, 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 reasonable cause to believe, that a Hazardous Substance has come to
be located in, on, under or about the Premises, other than as previously consented to by Lessor. Lessee shall immediately give written
notice of such fact to Lessor, and provide Lessor with a copy of any report, notice, claim or other documentation which it has concerning
the presence of such Hazardous Substance.
(c) Lessee Remedlation. 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 sanita ry sewer system) and shall promptly, at Lessee's expense, 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 Hazardous Substance brought onto the Premises by or for Lessee, or
any third party (provided, however, that Lessee shall have no liability under this Lease with respect to underground migration of any
Hazardous Substance under the Premises from adjacent properties). Lessee's obligations shall include, but not be limited to, the effects
or 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 w riting at the time of such agreement
(e) Lessor Obligation. Subject to Section 6.2(f) below, Lessor and its successors and assigns shall be responsible for the
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cost'of remediation which existoa result of Hazardous Substances on the Premises prior to ca rt Date or which are caused by
the gross negligence or willful 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.
(I) Investigations and Remediations. Lessor shall retain the responsibility and pay for any investigations or remediation
measures required by governmental entities having jurisdiction with respect to the existence of Hazardous Substances on the Premises
prior to the Start Date, unless such remediation measure is required as a result of Lessee's use (including alterations) 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 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 continue in full force and effect, but subject to Lessor's rights under Paragraph 6.2(d) and Paragraph
13), Lessor may, at Lessors option, either (I) investigate and remediate such Hazardous Substance Condition, 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 twelve (12) times the then monthly Base Rent or $100,000, whichever is greater, give written notice to
Lessee, within thirty (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 sixty (60) days following the date of such notice. In the event Lessor elects to give
a termination notice, Lessee may, within ten (10) days thereafter, give written notice to Lessor of Lessee's commitment to pay the
amount by which the cost of the remediation of such Hazardous Substance Condition exceeds an amount equal to twelve (12) times the
then monthly Base Rent or $100,000, whichever is greater. Lessee shall provide Lessor with said funds or satisfactory assurance thereof
within thirty (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 and provide 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 Premises, without regard to whether said requirements are now in effect or become effective after the Start
Date. Lessee shall, within ten (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 below) and consultants shall have the
right to enter into Premises at any time, in the case of an emergency, and otherwise at reasonable times, 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 contamination 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 or such inspections, so
long as such inspection is reasonably related to the violation or contamination.
7. Maintenance; Repairs, Utility Installations; Trade Fixtures and Alterations.
7.1 Lessee's Obligations
(a) In General. Subject to the provisions of Paragraph 2.3 (Compliance), 6.3 (Lessee's compliance with Applicable
requirements), 7.2 (Lessors Obligations), 9 (Damage and Destructions), and 14 (Condemnation), Lessee shall, at Lessee's sole
expense, keep the Premises, Utility Installations, 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, and whether 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, heating, ventilating, air-conditioning. electrical lighting facilities,
boilers, pressure vessels, fire protection system, fixtures, walls (interior and exterior), ceilings, floors, windows, doors, skylights,
landscaping, driveways, parking lots, fences, signs, sidewalks and parkways located in, on, or adjacent to the Premises. Lessee is also
responsible for keeping the roof and roof drainage clean and free of debris. Lessor shall keep the surface and structural elements of the
roof, foundations, and bea ring walls in good repair (see paragraph 7.2). Lessee, in keeping the Premises in good order, condition and
repair, shall exercise and perform good maintenance practices. Lessee's obligations shall include restorations, replacements or renewals
when necessary to keep the Premises and all improvements thereon or a part thereof in good order, condition and state of repair. Lessee
shall, during the term of this Lease, keep the exterior appearance of the Building in a first-class condition (including. e.g., graffiti removal)
consistent 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. Lessee shall, at Lessee's sole expense, procure and maintain contracts, with copies to Lessor, in
customary form and substance for, and with contractors specializing and experienced in the maintenance of the following equipment and
improvements ('Basic Elements'), if any, if and when installed on the Premises: (I) HVAC equipment, (i) boiler, and pressure vessels, (iii)
fire extinguishing systems, including fire alarm and/or smoke detection, (iv) landscaping and irrigation systems, (v )driveways and parking
lots, (vi) clarifiers, (vii) basic utility feed to the perimeter of the Building. and (viii) any other equipment, if reasonably required by Lessor
'see addendum paragraph 50
(c) Replacement. Subject 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 the Basic Elements described in
Paragraph 7.1 (b) cannot be repaired other than at a cost which is in excess of 50% of the cost of replacing such Basic Elements, then
such Basic Elements shall be replaced by Lessor, and the cost thereof shall be prorated between the Parties and Lessee shall only 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 the
number of months of the useful life of such replacement as such useful life is specified pursuant to Federal income tax regulations or
guidelines for depreciation thereof (including interest on the unamo rtized balance as is then commercially reasonable in the judgment of
Lessors accountants), with Lessee reserving the right to prepay its obligation at any time.
7.2 Lessor's Obligations. Subject to the provisions of Paragraphs 2.2 (Condition), 2.3 (Compliance), 9 (Damage or
Destru ction) 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, except for the
surface and structural elements of the roof, foundations and bearing walls, the repair of which shall be the responsibility of Lessor upon
receipt of written notice that such a repair is necessary it is the intention of the Parties that the terms of this Lease govern the respective
obligations of the Parties as to maintenance and repair of the Premises, and they expressly waive the benefit of any statute now or
hereafter in effect to the extent it is inconsistent with the terms of this Lease.
7.3 Utility Installations ; Trade Fixtures; Altera tions.
(a) Definitions; Consent Required. The term "Utility Installations" refers to all floor and window coverings, air lines,
power panels, electrical distribution, security and fire protection systems and signs, communication systems, 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 "Alte rations" 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). 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 Instaltations to the interior of the Premises (excluding the roof) without such consent
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but upon notice to Lessor, as Os they are not visible from the outside, do not involve punct. relocating or removing the roof or
any existing walls, and the cumulative cost thereof during this Lease as extended does not exceed $50,000 in the aggregate or $10,000
in anyone year.
(b) Consent. 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: (1) 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
mate rials. Lessee shall promptly upon completion furnish Lessor with as-built plans and specifications. For work which costs an amount
equal to the greater of one month's Base Rent, or $10,000, Lessor may condition its consent upon Lessee providing a lien and
completion bond in an amount equal to one and one-half times the estimated cost of such Alteration or Utility Installation and/or upon
Lessee's posting an additional Security Deposit with Lessor.
(c) Indemnification. Lessee shall pay, when due, all claims for labor or materials furnished or alleged to have been
furnished to or for Lessee at or for use on the Premises, which claims are or may be secured by any mechanic's or materialmen's lien
against the Premises or any interest therein. Lessee shall give Lessor not less than ten (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-responsibili ty. If Lessee shall contest the
validity of any such lien, claim or demand, then Lessee shall, at its sole expense defend and protect itself, Lessor and the Premises
against the same and shall pay and satisfy any such adverse judgment that may be rendered.thereon before the enforcement thereof. If
Lessor shall require, Lessee shall furnish a surety bond in an amount equal to one and one-half times the amount of such contested lien,
claim or demand, indemnifying Lessor against liability for the same. If Lessor elects to participate in any such action, Lessee shall pay
Lessors attorneys' fees and costs.
7.4 Owners hip; Removal; Surrender, and Restoration.
(a) Owners hip Subject to Lessees right to require removal or elect ownership as hereinafter provided, all Alterations and
Utility installations made by Lessee shall be the property of Lessee, but considered a part of the Premises. Lessor may, at any time, elect
in writing to be the owner of all or any specified part of the Lessee Owned Alterations and Utility 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 ninety (90) and not later than thirty (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 require the removal at any time of all or any part of any Lessee
Owned Alterations or Utility Installations made without the required consent.
(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" shall not include any damage or deterioration that would have been
prevented by good maintenance practice. Lessee shall repair any damage occasioned 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, and the removal, replacement, or remediation of any soil, material or groundwater contaminated by
Lessee. Trade Fixtures shall remain the property of Lessee and shall be removed by Lessee. 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 of Premium Increases.
(a) Lessee shall pay to Lessor any insurance cost increase ("Insurance Cost Increase") occurring during the term of this
Lease. "Insurance Cost Increase" is defined as any increase in the actual cost of the insurance required under Paragraph 8.2(b), 8.3(a)
and 8.3(b) ("Required Insurance "), over and above the Base Premium as hereinafter defined calculated on an annual basis. "Insurance
Cost Increase" shall include but not be limited to increases resulting from the nature of Lessee's occupancy, any act or omission of
Lessee, requirements of the holder of mortgage or deed of trust covering the Premises, increased valuation of the Premises and/or a
premium rate increase. The Parties are encouraged to fill in the Base Premium in Paragraph 1.9 with a reasonable premium for the
Required Insurance based on the Agreed Use of the Premises. If the parties fail to insert a dollar amount in Paragraph 1.9, then the Base
Premium shall be the lowest annual premium reasonably obtainable for the Required Insurance as of the commencement of the Original
Term for the Agreed Use of the Premises.
(b) Lessee shall pay any such Insurance Cost Increase to Lessor within thirty (30) days after receipt by Lessee of a copy of
the premium statement or other reasonable evidence of the amount due. If the insurance policies maintained hereunder cover other
property besides the Premises. Lessor shall also deliver to Lessee a statement of the amount of such Insurance Cost Increase
attributable only to the Premises showing in reasonable detail the manner in which such amount was computed. Premiums for policy
periods commencing prior to, or extending beyond the term of this Lease, shall be prorated to correspond to the term of this Lease;
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 against claims for bodily injury, personal injury and property damage based upon or ansing out of the ownership, use,
occupancy 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 $2,000,000 per occurrence with an "Additional Insured-Managers or Lessors of
Premises Endors ement " and contain the "Amendment of the Pollution Exclusion Endors ement " 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. Th e 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 or
Lessor, with loss payable to Lessor, any groundlessor, and to any Lender(s) insu ring loss or damage to the Premises. The amount of
such insurance shall be equal to the full replace ment cost of the Premises, as the same shall exist from time to time, or the amount
required by any Lenders, but in no event more than the commercially reasonable and available insurable value thereof. If Lessor is the
Insuring Party, however, Lessee 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 or included in the Base Premium), including coverage for debris removal and the enforcement of any Applicable Requirements
requiring the upgrading, demolition, reconstruction or replace ment 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 any 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. Such
insurance shall be subject to such deductible as Lessor deems advisable.
(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 (1) year. Said insurance shall provide that in the event the
Lease is terminated by reason of an insured loss, the period of indemni ty for such coverage shall be extended beyond the date of the
completion of repairs or replacement of the Premises, to provide for one full year's loss of Rent from the date of any such loss Said
insurance shall contain an agreed valua tion provision in lieu of any coinsurance clause, and the amount of coverage shall be adjusted
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annually to reflect the projected }7isnt otherwise payable by Lessee, for the next twelve (12) month period.
(c) Adjacent Premises. If the Premises are part of a larger building, or of a group of buildings owned by Lessor which are
adjacent to the Premises, the Lessee shall pay for any increase in the premiums for the property insurance of such building or buildings it
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 proce eds 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 Interruption . Lessee shall obtain and maintain loss of income and extra expense insuran ce in amounts as will
reimburse Lessee for direct or indirect loss of earnings attributable to all perils commonly insured against by prudent lessees in the
business of Lessee or attributable to prevention of acce ss to the Premises as a result of such perils.
(c) No Representation of Adequate Coverage . Lessor makes no representation that the limits or forms of coverage of
insurance specified herein are adequate to cover Lessee's property, business operations or obligations under this Lease.
8.5 Insurance Policies . Insuran ce 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, poor to the Start Date, deliver to Lessor
certified copies of policies of such insurance or certificates evidencing the existen ce and amounts of the required insurance. No such
policy shall be cancelable or subject to modification except after thirty (30) days prior written notice to Lessor. Lessee shall, at least thirty
(30) days prior to the expiration of such policies, furnish Lessor with evidence of renewals or "insurance binders" evidencing renewal
thereof, or Lessor may order such insurance and charge the cost thereof to Lessee, which amount shall be payable by Lessee to Lessor
upon demand. Such policies shall be for a term of at least one year, or the length of the remaining term of this Lease, whichever is less If
Lessee shall fail to procure and maintain the insurance required to be carved by it, Lessor 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. The effect of such releases and waivers is not limited by the amount of insurance
tamed 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 Indemni ty. Exce pt for Lessor's gross negligen ce or willful misconduct, Lessee shall indemnify, protect, defend and hold
harmless the Premises, Lessor and its agents, Lessor's master or ground lessor, partners and Lenders, from and against any and all
claims, loss of rents and/or damages, liens, judgments, 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 Liabili ty . 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 portions of the Building of
which the Premises are a part, or from other sources or place s. Lessor shall not be liable for any damages arising from any act or
neglect of any other tenant of Lessor. Notwithstanding Lessor's negligence or breach of this Lease. Lessor shall under no circumstances
be liable for injury to Lessee's business or for any loss of income or profit therefrom.
9. Damage or Destruction.
9.1 Definitions.
(a) "Premises Pa rtial Damage " shall mean damage or destruction to the improvements on the Premises, other than Lessee
Owned Alterations, Utility Installations and Trade Fixtures, which can reasonably be repaired in six (6) months or less from the date of
the damage or destruction. Lessor shall notify Lessee in writing within thirty (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 six (6) months or less from the date of the damage or
destruction. Lessor shall notify Lessee in writing within thirty (30) days from the date of the damage or destruction as to whether or not
the damage is Partial or Total.
(c) "Insure d 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.
"' Lessee shall be solely responsible for repairing any damage to the Premises caused by vandalism, burglaries and
other criminal activities caused by third parties. In addition, the lessee shall be responsible for Insured losses up to the
deduc tible.
9.2 Partial Damage - Insure d 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, mat e
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 proce eds available to Lessee on a reasonable basis for that purpose. Notwithstanding the foregoing, if the required
insurance was not in force or the insurance proceeds are not sufficient to effect such repair, the Insuring Party shall promptly contribute
the shortage in proce eds as and when required to complete said 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 proce eds 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 ten (10) days following
rece ipt of written notice of such shortage and request therefor. If Lessor rece ives said funds or adequate assurance thereof within said
ten (10) day period, the party responsible for making the repairs shall complete them as soon as reasonably possible and this Lease shall
remain in full force and effe ct If such funds or assuran ce are not received, Lessor may nevertheless elect by written notice to Lessee
within ten (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 thirty (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 repai rs at Lessee's expense), Lessor may either. (i) repair such
5
damage as soon as reasonably'6ssible at Lessor's expense, in which event this Lease shall conn"Mue in full force and effect, or (ii)
terminate this Lease by giving written notice to Lessee within thirty (30) days after receipt by Lessor of knowledge of the occurrence of
such damage. Such termination shall be effective sixty (60) days following the date of such notice. In the event Lessor elects to terminate
this Lease, Lessee shall have the right within ten (10) days after receipt of the termination notice to give written notice to Lessor of
Lessee's commitment to pay for the repair of such damage without reimbursement from Lessor. Lessee shall provide Lessor with said
funds or satisfactory assurance thereof within thirty (30) days 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 Destruc tion. Notwithstanding any other provision hereof, if a Premises Total Destruction occurs, this Lease shall
terminate sixty (60) days following such Destruction. If the damage or destruction was caused by the 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 any time during the last six (6) months of this Lease there is damage for which the cost to
repair exceeds one (1) month's Base Rent, whether or not an Insured Loss. Lessor may terminate this Lease effective sixty (60) days
following the date of occurrence of such damage by giving a written termination notice to Lessee within thirty (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 shortage
in insurance proceeds (or adequate assurance thereof) needed to make the repairs on or before the earlier of (i) the date which is ten
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 extinguished.
96 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 or restoration 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 ninety (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 sixty (60) days following the giving of such notice. If Lessee gives such
notice and such repair or restoration is not commenced within thirty (30) days thereafter, this Lease shall terminate as of the date
specified in said notice. If the repair or restoration is commenced within said thirty (30) days, this Lease shall continue in full force and
effect. "Commence' shall mean 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
equitable adjustment shalt 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. Lessor and Lessee agree that the terms of this Lease shall govern the effect of any damage to or
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 Proper ty Taxes
10.1 Definition of "Real Property Taxes." 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 the
Premises, Lessor's right to other income therefrom, and/or Lessor's business of leasing, by any authority having the direct or indirect
power to tax and where the funds are generated with reference to the Building address and where the proceeds so generated are to be
applied by the city, county or other local taxing authority charge, or any increase therein, imposed by reason of events occurring during
the term of this Lease, including buy not limited to, a change in the ownership of the Premises.
10 2(a) Payment of Taxes Lessor shall pay the Real Property Taxes applicable to the Premises provided, however, that
Lessee shall pay to Lessor the amount, if any, by which Real Property Taxes applicable to the Premises increase over the fiscal tax year
during which the Commencement Date occurs (Tax Increase"). Subject to Paragraph 10.2(b), payment of any such Tax Increase shall
be made by Lessee to Lessor within thirty (30) days after receipt of Lessor's written statement setting forth the amount due and the
computation thereof. If any such taxes shall cover any period of time prior to or after the expiration or termination of this Lease. Lessee's
share of such taxes shall be prorated to cover only that portion of the tax bill applicable to the period that this Lease is in effect.
(b) Advance Payment. In the event Lessee incurs a late charge on any Rent payment, Lessor may, at Lessor's option,
estimate the current Real Property Taxes, and require that the Tax Increase be paid in advance to Lessor by Lessee, either. (i) in a lump
sum amount equal to the amount due, at least twenty (20) days poor to the applicable delinquency date; or () monthly in advance with
the payment of the Base Rent. If Lessor elects to require payment monthly in advance, the monthly payment shall be an amount equal to
the amount of the estimated installment of the Tax Increase divided by the number of months remaining before the month in which said
installment becomes delinquent. When the actual amount of the applicable Tax Increase is known, the amount of such equal monthly
advance payments shall be adjusted as required to provide the funds needed to pay the applicable Tax Increase. If the amount collected
by Lessor is insufficient to pay the Tax Increase when due, Lessee shall pay Lessor, upon demand, such additional sums as are
necessary to pay such obligations. All moneys paid to Lessor under this Paragraph may be intermingled with other moneys of Lessor and
shall not bear interest. In the event of a Breach by Lessee in the performance of its obligations under this Lease, then any balance of
funds paid to Lessor under the provisions of this Paragraph may at the option of Lessor, be treated as an additional Security Deposit.
(c) Additional Improvements. Notwithstanding anything to the contrary in this Paragraph 10.2, Lessee shall pay to Lessor
upon demand therefor the entirety of any increase in Real Property Taxes assessed by reason of Alterations or Utility Installations placed
upon the Premises by Lessee or at Lessee's request.
10.3 Joint Assessment. If the Premises are not separately assessed, Lessee's liability shall be an equitable proportion of the
Tax Increase 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 Lessee
Owned Alterations, Utility Installations, Trade Fixtures, furnishings, equipment and all personal property of Lessee. When possible,
Lessee shall cause such property to be assessed and billed separately from the real property of Lessor. If any of Lessee's said personal
property shall be assessed with Lessor's real proper ty, Lessee shall pay Lessor the taxes attributable to Lessee's property within ten (10)
days after receipt of a written statement.
11. Utilities. 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 to Lessee . Lessee shall pay a reasonable
proportion, to be determined by Lessor, of all charges jointly metered.
12. Assignment and Subletting.
12.1 Lessor's Consent Required.
(a) Lessee shall not voluntarily or by opera tion 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 written consent.
(b) A change in the control of Lessee shall constitute an assignment requiring consent. The transfer, on a cumulative basis,
•of twenty-five percent (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 twenty-five
percent (25%) of such Net Worth as it was represented at the time of the execution of this Lease or at the time of the most recent
assignment to which Lessor has consented, or as it exists immediately prior to said transaction or transactions constituting such
reduction, 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 Landlord's consent shall be void, and shall constitute a material Default and Breach
of this Lease without the need for any notice or grace period to Lessee under paragraph 13.1 below. In such event, Landlord can
terminate this Lease and pursue all other rights and remedies hereunder or at law or in equity for a Default. In addition, effective as of the
date of such improper assignment or sublease, the monthly Base Rent shall automatically be increased to 200% of the Base Rent in
effect immediately prior to such improper assignment or sublease- Further, any subsequent fixed or non-fixed rental adjustments shall be
increased by 200% above the rental adjustment that would otherwise take effect.
(e) Lessee's remedy for any breach of Paragraph 12.1 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, any assignment or subletting shall not: (i) be effec tive 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 obligations from 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's right 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 therefore 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 non refundable fee of
$1,000 or 10% of the current monthly Base Rent applicable to the portion of the Premises which is the subject of the proposed
assignment or sublease, whichever is greater, as consideration for Lessee's request. Such fee is soley to compensate Lessor for
Lessor's consideration of such proposed assignment of sublease. The payment of such fee does not in any way imply that Lessor will
approve the proposed assignment or sublease. If Lessor approves such assignment or sublease, Lessor may approve such assignment
or sublease conditioned upon Lessee's payment to Lessor of all consideration received by Lessee from the proposed assignee or
sublessee and or payment of an additional sum from Lessee to be released from the Lease Lessee agrees to provide Lessor with such
other or additional information and/or documentation as may be reasonably requested.
(f) Any assignee of, or sublessee under, this Lease shall, by reason of accepting such assignment or entering into such
sublease, be deemed to have assumed and agreed to conform and comply with each and every term, covenant, condition and obligation
herein to be observed 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 sublease to which Lessor has specifically consented to in writing.
12.3 Additional Terms and conditions Applicable to Subletting The following terms and conditions shall apply to any
subletting by Lessee 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 lessor
may collect such Rent and apply same toward lessee's obligations under this lease; provided, however, that until a Breach shall occur in
the performance of Lessee's obligations, Lessee may collect said Rent. Lessor shall not, by reason of the foregoing or any assignment of
such sublease, not 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
Lessor all Rent due and to become due under the sublease. Sublessee shall rely upon any such notice from Lessor and shall pay all
Rents to Lessor without any obligation 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 deposit 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 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 the terms, covenants,
conditions or rules 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, and/or Security Deposit or where the coverage of the property insurance described in 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 required to be made by Lessee hereunder,
whether 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 three (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, (tit) INTENTIONALLY DELETED, (iv) an Estoppel Certificate, (v) a requested subordination, (vi) evidence concerning
any guaranty and/or Guarantor, (vii) any document requested under Paragraph 42 (easements), or (viii) 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 ten (10) days following written notice to Lessee.
(d) A Default by Lessee as to the terms, covenants, conditions or provisions of this Lease, or of the rules adopted under
Paragraph 40 hereof, other than those described in subparagraphs 13.1 (a), (b) or (c), above, where such Default continues for a period
of thirty (30) days after written notice; provided, however, that if the nature of Lessee's Default is such that more than thirty (30) days are
reasonably required for its cure, then it shall not be deemed to be a Breach if Lessee commences such cure within said thirty (30) day
period and thereafter diligently prosecutes such cure to completion
(e) The occurrence of any of the following events: (i) the making of any general arrangement or assignment for the benefit
of creditors; (r) becoming a "debtor" as defined in 11 U.S.C. § 101 or any successor statute thereto (unless, in the case of a petition filed
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against Lessee, the same is dismissed within sixty (60) days); (iii) the appointment of a trustee or ieceiver to take possession of
substantially all of Lessee's assets located at the Premises or of Lessee's interest in this Lease, where possession is not restored to
Lessee within thirty (30) days; or (iv) the attachment, execution or other judicial seizure of substantially all of Lessee's assets located at
the Premises or of Lessee's interest in this Lease, where such seizure is not discharged within thirty (30) days; 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 Lessees obligations under this Lease is guaranteed: (I) the death of a Guarantor; (i) the
termination of a Guarantor's liability with respect to this Lease other than in accordance with the terms of such guaranty; (fit) a
Guarantor's becoming insolvent or the subject of a bankruptcy filing; (w) 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 sixty (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 ten (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. The costs and
expenses of any such performance by Lessor shall be due and payable by Lessee upon receipt of invoice there for. If any check given to
Lessor by Lessee shall not be honored by the bank upon which it is drawn, Lessor, at its option, may require all future payments to be
made by Lessee to be by cashier's check. In the event of a Breach, Lessor may, with or without further 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 the Premises by any lawful means, in which case this Lease shall 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 amount by which 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 the detriment 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 unexpired term
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 Premises are
located at the time of award plus one percent (1%). Efforts by Lessor to mitigate damages caused by Lessee's Breach of 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 recover in such proceeding any unpaid Rent and damages as are recoverable therein.
or Lessor may reserve the right 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 this 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 io 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) Pursue any other remedy now or hereafter available under the laws or judicial decisions of the state wherein the
Premises are located. The expiration 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, inducement or
consideration theretofore abated, given or paid by Lessor under such an Inducement Provision shall be immediately due and payable by
Lessee to Lessor, notwithstanding any subsequent cure of said Breach by Lessee. The acceptance by Lessor of rent or the cure of the
Breach which initiated the operation of this paragraph shall not be deemed a waiver 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 five (5) days after such amount shall be due, then, without any requirement for notice to Lessee, Lessee
shall pay to Lessor a one-time late charge equal to ten percent (10%) of each such overdue amount. The parties hereby agree that such
late charge represents a fair and reasonable estimate of the costs Lessor will incur by reason of 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 the exercise of any of the other rights and remedies granted hereunder. In the event that a late charge is payable hereunder,
whether or not collected, for three (3) consecutive installments of Base Rent, then notwithstanding any provision or 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 thirty (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 thirty-first (31 st) day after it was due as to non-scheduled
payments. The interest ("Interest") charged shall be equal to the prime rate reported in the Wall Street Journal as published closest prior
to the date when due plus 4%, but shall not exceed the maximum rate allowed by law. Interest is payable in addition to the potential late
charge provided for in Paragraph 13.4.
13.6 Breach by Lessor. 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 thirty (30) days after receipt by Lessor, and any Lender whose name and address shall have been furnished Lessee in writing for
such purpose, of written notice specifying wherein such obligation of Lessor has not been performed; provided, however, that if the
nature of Lessors obligation is such that more than thirty (30) days are reasonably required for its performance, then Lessor shall not be
in breach if performance is commenced within such thirty (30) day period and thereafter diligently pursued to completion.
14. Condemnation . If the Premises or any po rtion 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 ten percent (10%) of any building portion of the premises, or more
than twen ty five percent (25%) of the land area portion of the premises not occupied by any building, is taken by Condemnation . Lessee
may, at Lessee's option, to be exercised in writing within ten (10) days after Lessor shall have given Lessee written notice of such taking
(or in the absence of such notice, within ten (10) days after the condemning authority shall have taken possession) terminate this Lease
as of the date the condemning authority takes such possession. If Lessee does not terminate this Lease in accordance with the
foregoing, this Lease shall remain in full force and effect as to the portion of the Premises remaining, except that the Base Rent shall be
reduced in proportion to the reduction in utility of the Premises caused by such Condemnation. Condemnation awards and/or payments
8
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shall be the property of Lessor, her such award shall be made as compensation for diminution in value of the leasehold, the value or
the part taken, or for severance damages; provided, however, that Lessee shall be entitled to any compensation for Lessee's relocation
expenses, 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 prope rty of the Lessee and Lessee shall be en tilled 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. Brokers ' Fee. ARE AS AGREED 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 party 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 ten (10) days after written notice from the other Party (the "Requesting
Party") execute, acknowledge and deliver to the Requesting Party a statement in writing in form similar to the then most current
"Estoppel Certificate" form published by the American Industrial Real Estate Association, plus such additional information, confirmation
and/or statements as may be reasonably requested by the Requesting Party.
(b) If the Responding Party shall fail to execute or deliver the Estoppel Certificate within such ten 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 (n) if Lessor is the
Requesting Party, not more than one month's rent has been paid in advance. Prospec tive purchase rs 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 statements for the past three (3) years. All such financial statements shall be
received by Lessor and such lender or purchaser in confidence and shall be used only for the purposes herein set forth.
17. Definition of Lessor. The term "Lessor" as used herein shalt mean the owner or owners at the time in question of the fee title to the
Premises, or, if this is a sublease, of the Lessee's interest in the prior lease. In the event of a transfer of Lessor's title or interest in the
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 assignment and delivery of the Security Deposit, as aforesaid, the
prior Lessor shall be relieved of all liability with respect to the obligations and/or covenants under this Lease thereafter to be performed
by the Lessor. Subject to the foregoing, the obligations and/or covenants in this Lease to be performed by the Lessor shall be binding
only upon the Lessor as herein above 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
20.1-imitation on Liability. Subject to the provisions of Paragraph 17 above, the obligations of Lessor under this Lease shall not
constitute personal obligations of Lessor, the individual partners of Lessor or its or their individual partners, 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 not seek recourse against the individual partners of Lessor, or its or their individual partners, 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 obse rved 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 other prior or contemporaneous agreement or understanding shall be effective. Lessor and Lessee
each represents and warrants to the Brokers that it has made, and is relying solely upon, its own investigation as to the nature, quality,
character and financial responsibility of the other Party to this Lease and as to the 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, delive ry or performance by either Lessor or Lessee
under this Lease or any amendment or modification hereto shall be limited to an amount up to 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.
23. Notices.
23.1 Notice Requirements. All notices required or permitted by this Lease 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 deemed sufficiently given if served in a manner specified in this Paragraph 23. The addresses
noted adjacent to a Party's signature on this Lease shall 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 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 transmi tted to such party or
parties at such addresses as Lessor may from time to time hereafter designate in writing.
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 forty-eight (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 twenty-four (24) hours after
delivery of the same to the Postal Service or courier. Notices transmitted by facsimile transmission or similar means shall be deemed
delivered upon telephone confirmation of receipt, provided a copy is also delivered via delivery 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 by Lessor on account of moneys or damages due Lessor,
notwithstanding any qualifying statements or conditions made by Lessee in connection therewith, which such statements and/or
conditions shall be of no force or effect whatsoever unless specifically agreed to in writing by Lessor at or before the time of deposit of
such payment
25. Recording Neither party shall have the right to record this Lease or a short form memorandum thereof.
26. No Right To Holdover . 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 one hundred fifty percent (150%)
of the Base Rent applicable during the month immediately preceding the expiration or termination. Nothing contained herein shall be
construed as consent by Lessor to any holding over by Lessee.
27. Cumulative Remedies . No remedy or election hereunder shall be deemed exclusive but shall, wherever possible, be cumulative with
all other remedies at law or in equity.
28. Covenants and Conditions ; Construc tion of Agreement . All provisions of this Lease to be obse rved 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
9
be considered a part of this LeaaWhenever required by the context, the singular shall include t7Ttrplural 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 Lease and any Option granted hereby shall be subject and subordinate to any ground lease.
mortgage, deed of trust, or other hypothecation or security device (collectively. "Security Device"), now or hereafter placed upon the
Premises, to any and all advances made on the security thereof, and to all renewals, modifications, and extensions thereof. Lessee
agrees that the holders of any such Security Devi ces (in this Lease together referred to as "Lessor's Lender") shall have no liabili ty or
obligation to perform any of the obligations of Lessee 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 shalt be deemed prior to such Secu rity Device, notwithstanding the rela tive dates of the documentation or recordation thereof..
30.2 Attomment. Subject to the non-disturbance provisions of Paragraph 30.3, Lessee agrees to attom to a Lender or any
other party who acquires ownership of the Premises by reason of a foreclosure of a Security Device, and that in the event of such
foreclosure, such new owner shall not: (i) be liable for any act or omission of any prior lessor or with respect to events occurring prior to
acquisition of ownership; (ii) be subject to any offsets or defenses which Lessee might have against any prior lessor; or (ii) be bound by
prepayment of more than one (1) month's rent.
30.3 Non-Disturbance. 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 attoms to the record
owner of the Premises. Further, within sixty (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.
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 in connection 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, attomment and/or Non-Disturbance Agreement provided for herein.
31. Attorneys' Fees. If any Party or Broker brings an action or proceeding involving the Premises to enforce the terms hereof 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 commen ced in connection with such Default or resulting Breach
32.Lessor s Access; Showing Premises; Repairs. Lessor and Lessor's agents shall have the right to enter the Premises at any time,
in the case of an emergency, and otherwise at reasonable times for the purpose of showing the same to prospective purchasers, lenders,
or lessees, and making such alterations, repairs, improvements or additions to the Premises as Lessor may deem necessary. All such
activities shall be without abatement of rent or liability to Lessee. Lessor may at any time place on the Premises any ordinary "For Sale"
signs and Lessor may during the last six (6) months of the term hereof place on the Premises any ordina ry "For Lease" signs.
33. Auctions. Lessee shall not conduct, nor permit to be conducted, any auction upon the Premises without Lessor's poor written
consent. Lessor shall not be obligated to exercise any standard of reasonableness in determining whether to permit an auction.
34. Signs. Lessee shall not place any sign upon the Premises without Lessors prior written consent. All signs must comply with 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 anyone or all existing
subtenancies. Lessor's failure within ten (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 not be unreasonably withheld or delayed. Lessor's actual reasonable costs and expenses (including but
not limited to architects', attorneys', engineers' and other consultants' fees) incurred in the consideration of, or response to, a request by
Lessee for any Lessor 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, conditions as are then reasonable with reference to the particular
matter for which consent is being given. In the event that either Party disagrees with any determination made by the other hereunder and
reasonably requests the reasons for such determination, the determining party shall furnish its reasons in writing and in reasonable detail
within ten (10) business days following such request.
37. Guarantor.
37.1 Execution. The Guarantors, if any, shall each execute a guaranty in Lessor's standard 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 shalt 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 the case of
a corporate Guarantor, a certified copy of a resolution of its board of directors authorizing the making of such guaranty, (b) current
financial statements, (c) an Estoppel Certificate, or (d) written confirmation that the guaranty is still in effect.
38. Quiet Possession. Subject to payment by Lessee of the Rent and performance of all of the covenants, conditions and provisions on
Lessee's part to be observed and performed under this Lease, Lessee shall have quiet possession and quiet enjoyment of the Premises
during the term hereof.
39. Options.
39.1 Definition. "Option" shall mean: (a) the right to extend the term of or renew this Lease or to extend or renew any tease
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. Each Option granted to Lessee in this Lease is personal to the original Lessee.
and cannot be assigned or exercised by anyone other than said original Lessee and only while the original Lessee is in full possession of
the Premises and, if requested by Lessor, wi th Lessee certifying that Lessee has no intention of thereafter assigning or suble tting.
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 Opti ons.
(a) Lessee shall have no right to exercise an Option: (i) during the period commencing with th e giving of any notice of
Default and continuing until said Default is cured; (ii) during the period of time any Rent is unpaid (without regard to whether notice
thereof is given Lessee); (iii) during the time Lessee is in Breach of this Lease; or (iv) in the event that Lessee has been given three (3) or
more notices of separate Default, whether or not the Defaults are cured, during the twelve (12) month period immediately preceding the
10
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 Option shall terminate and be of no further force or effect, notwithstanding Lessee's due and timely exercise of the
option, if, after such exercise and prior to the commencement of the extended term, (i) Lessee fails to pay Rent for a period of thirty (30)
days after such Rent becomes due (without any necessity of Lessor to give notice thereof), (ii) Lessor gives to Lessee three (3) or more
notices of separate Default during any twelve (12) month penod, whether or not the Default are cure, or (iii) 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 observe 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 cleanliness of the grounds and including the parking, loading and unloading of vehicles, and that Lessee will pay
its fair share of common expenses incurred in connection therewith.
41. Security Measu re s. Lessee hereby acknowledges that the rental payable to Lessor hereunder does not include the cost of guard
service or other security 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. Reserv ations. Lessor reserv es 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 restrictions do not unreasonably interfere with the use of the Premises by Lessee.
Lessee agrees to sign any documents reasonably requested by Lessor to effectuate any such easement rights, dedication, map or
restrictions.
43.Performance Under Protest If at any time a dispute shall arise as to any amount or sum of money to be paid by one Party to th e
other under the provisions hereof, the Party against whom the obligation to pay the money is asserted shall have the right to make
payment "under protest" and such payment shall not be regarded as a voluntary payment and there shall survive the right on the part of
said Party to institute suit for recovery of such sum. If it shall be adjudged that there was no legal obligation on the part of said Party to
pay such sum or any part thereof, said Party shall be entitled to recover such sum or so much thereof as it was not legally required to
pay.
44. Authority. If either Party hereto is a corporation, trust, limited liability company, partnership, or similar entity, each individual
executing this Lease on behalf of such entity represents and warrants that he or she is duty authorized to execute and deliver this Lease
on its behalf. Each party shall, within thirty (30) days after request, deliver to the other party satisfactory evidence of such authority.
45. Conflict. Any conflict between the printed provisions of th is Lease and the typewritten or handwritten provisions shall be controlled by
the typewritt en or handwritten provisions.
46. Offer. Preparation of this Lease by either Party or their agent and submission of same to th e other Party shall not be deemed an offer
to lease to th e other Party. This Lease is not intended to be binding until executed and delivered by all Parties hereto.
47. Amendments. This Lease may be modified only in writing, signed by th e Parties in interest at the time of th e modification. As long as
they do not materially change Lessee's obligations hereunder, Lessee agrees to make such reasonable non-monetary modifications to
this Lease as may be reasonably required by a Lender in connection with the obtaining of normal financing or refinancing of the
Premises.
48. Multiple Parties. If more than one person or entity is named herein as either Lessor or Lessee, such multiple Parties shall have joint
and several responsibility to comply with the terms of this Lease.
49.Mediation and Arbitration of Disputes . An Addendum requiring th e Mediation and/or the Arbitration of all disputes between the
Parties and/or Brokers arising out of this Lease is not attached to this Lease.
EXHIBIT "A"- SITE PLAN: ATTACHED HERETO AND MADE A PART HEREOF.
EXHIBIT"S"- RULES AND REGULATIONS: ATTACHED HERETO AND MADE A PART HEREOF.
EXHIBIT "C" - SIGN CRITERIA: ATTACHED HERETO AND MADE A PART HEREOF.
EXHIBIT "D" - GUARANTY OF LEASE: ATTACHED HERETO AND MADE A PART HEREOF.
ADDENDUM PARAGRAPHS 5057 : ATTACHED HERETO AND MADE A PART HEREOF.
LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND PROVISION CONTAINED
HEREIN, AND BY THE EXECUTION OF THIS LEASE SHOW THEIR INFORMED AND VOLUNTARY CONSENT THERETO. THE
PARTIES HEREBY AGREE THAT, AT THE TIME THIS LEASE IS EXECUTED. THE TERMS OF THIS LEASE ARE COMMERCIALLY
REASONABLE AND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE PREMISES.
The parties hereto have executed this Lease at the place and on the dates specified above their respective signatures.
Executed at: Mission Viejo, CA 92691 Executed at: Huntington Beach, CA 92647
on: on:
By LESSOR: By LESSEE:
Princeland Properties (International), Inc. Sportswear Resources, Inc.
By: By:
Name Printed: James Prause Name Printed: William J. Jackson
Title: President Title: President
Address: 26039 Acero Suite 101
Mission Viejo, CA 92691 By:
Telephone: (949) 380-1319 Name Printed:
Facsimile: (949) 380-1792 Title:
Federal ID No. 95-1860749 Address:
Telephone:
Facsimile:
Federal ID No.
11
•
EXI-IIBIT "A"
SITE PLAN
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•
PIIINCE1ANU HUNTINOI-ON BEACH INDUSTMAL
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Initials:
EXHIBIT "A"
SITE PLAN
Page 1 of 1
16692
Dud.
16662
Dwk.
EXHIBIT "B"
RULES AND REGULATIONS
1. Lessee agrees to maintain and keep the area around his leased premises in a reasonably clean condition, at
Lessee's expense.
2. In the event Lessee should be permitted to use, by the discretion of Lessor, during the course of his business
anything related to the use of fiberglass material, chemicals or other allied material, Lessee agrees to place in shop
area two (2) layers of asphalt laminated craft paper or equivalent material which is to be replaced as needed during
the period of occupancy. Lessee agrees to permit Lessor or his agent to inspect such area(s) as deemed necessary.
3. Lessee shall not overload the floor of the Premises or mark, drive nails, screw or drill into the partitions,
woodwork or plaster or in any way deface the Premises or any part thereof. No boring, cutting or sh inging of wires
or laying of linoleum or other similar floor coverings shall be permitted except with the prior written consent of the
Lessor and as the Lessor may direct.
4. Lessee agrees that it shall comply with all tire and security regulations that may be issued from time to time by
Lessor's Insurance Company or local governing authority and also shall provide Lessor with the name of a
designated responsible employee to represent Lessee in all matters pertaining to such fire or security regulations.
5. No sign, placard, picture, advertisement, name or notice shall be inscribed, displayed or printed or affixed on or
to any part of the outside or inside of the Building, landscape area, street or parking area without written consent of
Lessor, unless mandated by State or Federal Law. Lessor shall have the right to remove any such sign, placard,
picture, advertisement, name or notice without notice to and at the expense of the Lessee.
6. Lessee agrees there shall be no pets or animals permitted inside or outside the leased premises.
7. No Lessee, employee or invitee shall unnecessarily go upon the roof of the Building.
8. Lessee shall not use, keep or permit to be used or kept any foul or noxious gas or substance in the Premises, or
permit or suffer the Premises to be occupied or used in a manner offensive or objectionable to the Lessor or other
occupants of the Premises by reason of excessive noise, odors and/or vibrations, or interfere in any way with other
occupants or those having business therein. Lessee shall not make or be permitted to make any unseemly or
disturbing noises or disturb or interfere with occupants of this or neighboring Buildings or Premises or those having
business with them whether by use of any musical instruments, radio, phonograph, unusual noise, or in any other
way.
9. Lessee shall not use or keep in the Premises or the Building any kerosene gasoline or inflammable or combustible
fluid or materials, or use any method of heating or air conditioning other than that supplied by Lessor.
10. Lessee agrees to reimburse Lessor on a monthly basis, along with the rent payment the current monthly charge
of as per the terms of the lease for common area maintenance charges. Lessor reserves the right to adjust these
monthly charges upwards or downwards as the need dictates or as the charges for these services should change.
11. Lessee shall not make, suffer or permit litter except in appropriate receptacles for that purpose.
12. Lessee assumes all risks from theft or vandalism and agrees to keep its Premises locked as may be required.
13. Lessee shall adhere to all laws pertaining to smoking, including but not limited to not smoking within the
building.
Lessor reserves the right by written notice to Lessee, to add, rescind, alter or waive any rule or regulation at any
time prescribed for the Project when in Lessor's judgement, it is necessary, for the safety, care and cleanliness of
the Project and for the preservation of good order therein. Lessee agrees to abide by all such rules and regulations
herein and any additional rules and regulations which are adopted.
APPROVED AND AGREED TO:
rules-freestanding only
Initials:
EXHIBIT-13"
RULES AND REGULATIONS
EXHIBIT "C"
SIGN CRITERIA
1. SIGN CRITERIA - FRONTAGE
These criteria establish the uniform policies for all Lessee 's sign identification. These criteria
have been established for the purpose of maintaining the overall appearance of the Park
Conformance will be strictly enforced.
A. General Requirements:
1. Lessee will pay a sign deposit of $250.00 upon commencement of the lease, to be
returned upon Lessee 's removal of sign and repair of any damage from such removal.
2. Lessee will be responsible for the cost of their own sign, which must be approved by
the Lessor prior to installation. Failure to comply with this step will result in the sign
being removed at the Lessee 's sole cost.
3. Lessee will install within thirty (30) days from Lease commencement date, a sign
provided by a Lessor approved sign vendor, or Lessor shall install a sign for the Lessee.
Copy shall be Lessee's name as stated on the first page of the lease. Lessee shall be
charged with all costs, which shall be immediately payable upon demand to Lessor.
4. Lessor will direct the placement of all Lessee signs and the method of attachment
to the building
5. Lessee will be provided with the name of the sign company for information relating to
the installation of the above referenced sign.
6. Lessor will approve all copy and/or logo design prior to the installation of the sign.
7. Lessee will be responsible for the fulfillment of all requirements of these criteria.
B. General Specifications:
1. The sign's dimensions will be within the parameters specified by the city ordnance.
2. All sign lettering will conform to the color on the building. No other color will be
allowed.
3. No elec trical or audible signs will be allowed.
4. Upon removal of any signs , any damage to the building will be repaired by the Lessee.
5. The sign, which includes size, shape, and composition wi ll conform with the standard
sign common within the park and will be provided by the Lessee at his or her cost.
6. Lessee shall be allowed a 2'x2' logo area and two lines of text. The top line shall be no
larger than 12" lettering and bottom line shall be no larger than 6"
INTI'IAL.S
EXHIBIT "C"
SIGN CRITERIA
Sign Criteria-05(0,06,07(Q,091,111(t)
• GUARANTY OF LEASE •EXHIBIT "D "
WHEREAS, Princeland Pro ertics International Inc hereinafter "Lessor", and S ortswear Resources Inc.
hereinafter "Lessee", are about to execute a document entitled "Lease" dated December 14, 2010 concerning the premises commonly
known as 16662-16692 Cothard Street Huntin ton Beach CA 92647 wherein Lessor will lease the premises to Lessee, and
WHEREAS, William J. Jackson hereinafter "Guarantor(s)" have a financial interest in Lessee, and
WHEREAS, Lessor would not execute the Lease if Guarantor(s) did not execute and deliver to Lessor this Guarantee of
Lease.
NOW THEREFORE, in consideration of the execution of the foregoing Lease by Lessor and as a material inducement to
Lessor to execute said Lease, Guarantor(s) hereby jointly, severally, unconditionally and irrevocably guarantee as a primary obligor,
and not as a surety, the prompt payment by Lessee of all rents and all other sums payable by Lessee under said Lease and the faithful
and prompt performance by Lessee of each and everyone of the terms, conditions and covenants of said Lease to be kept and
performed by Lessee. This Guaranty is a guarantee of payment and performance and not of collection.
It is specifically agreed that the terms of the foregoing Lease may be modified, without the consent of or notice to Guarantor,
by agreement between Lessor and Lessee, or by a course of conduct, and said Lease may be assigned by Lessor or any assignee of
Lessor without consent of or notice to Guarantor(s) and that this Guaranty shall guarantee the performance of said Lease as so
modified. Without consent of or notice to Guarantor(s) and without affecting any of the obligations of Guarantor(s) under this
Guaranty, Lessor may permit all or any part of the Premises or of the rights or liabilities of Lessee under the Lease to be sublet,
assigned, or assumed and Lessor may release, substitute, or add any guarantor of or party to the Lease. This is a continuing guaranty
and Guarantor(s) waives the benefit of the provisions of California Civil Code Section 2815.
This Guaranty shall not be released, modified or affected by the failure or delay on the part of Lessor to enforce any of the
rights or remedies of the Lessor under said Lease, whether pursuant to the terms thereof or at law or in equity.
No notice of default need be given to Guarantor(s), it being specifically agreed that the guarantee of the undersigned is a
continuing guarantee under which Lessor may proceed immediately against Lessee and/or against Guarantor(s) following any breach
or default by Lessee or for the enforcement of any rights which Lessor may have as against Lessee under the terms of the Lease or at
law or in equity.
Lessor shall have the right to proceed against Guarantor(s) hereunder following any breach or default by Lessee without first
proceeding against Lessee and without previous notice to or demand upon either Lessee or Guarantor(s).
Guarantor(s) hereby waive (a) notice of acceptance of this Guaranty, (b) demand of payment, presentation and protest, (c) all
right to assert or plead any statute of limitations relating to this Guaranty or the Lease, (d) any right to require the Lessor to proceed
against the Lessee or any other Guarantor or any other person or entity liable to Lessor, (e) any right to require Lessor to apply to any
default, any secunty deposit or other security it may hold under the Lease, (f) any right to require Lessor to proceed under any other
remedy Lessor may have before proceeding against Guarantor(s), (g) any right of subrogation., (h) any right or defense that may arise
by reason of the incapacity, tack of authority, death, or disability of Lessee or any other person, and (I) any right or defense arising by
reason of the absence, impairment, modification, limitation, destruction or cessation of the liability of Lessee. Without in any manner
limiting the generality of the foregoing, Guarantor(s) waives the benefits of the provisions of California Civil Code Section 2809-
2819, 2845 and 2849-2850 and any similar analogous statues of California or any other jurisdiction.
Until all of Lessee's obligations under the Lease are fully performed, Guarantor(s) (1) will have no right of subrogation
against Lessee by reason of any payments or acts of performance by Guarantor(s) under this Guaranty; and (ii) hereby subordinates all
existing or future indebtedness or liability of Lessee to Guarantor(s) to the obligations owed to Lessor under the Lease and this
Guaranty.
If a Guarantor is married, such Guarantor expressly agrees that recourse may be had against his or her separate property for
all of the obligations hereunder. If Guarantor is more than one (1) person, the obligations of the persons comprising Guarantor shall be
joint and several and the unenforceability of this Guaranty of Lessor's election not to enforce this Guaranty against one (I) or more of
the persons comprising Guarantor shall not affect the obligations of the remaining persons comprising Guarantor or the enforceability
of the Guaranty against such remaining persons.
To the extent permitted by law, Guarantor hereby waives its right to trial by jury in any action or proceeding involving this
Guaranty.
The obligations of Lessee under the Lease to execute and deliver estoppel statements and financial statements, as therein
provided, shall be deemed to also require the Guarantor(s) hereunder to do and provide the same.
The term "Lessor" refers to and means the Lessor named in the Lease and also Lessor's successor(s) and assign(s). So long as
Lessor's interest in the Lease, the ]eased premises or the rents, issues and profits therefrom, are subject to any mortgage or deed of trust
or assignment for security, no acquisition by Guarantor(s) of the Lessor's interest shall affect the continuing obligation of Guarantor(s)
under this Guaranty which shall nevertheless continue in full force and effect for the benefit of the mortgagee, beneficiary, trustee or
assignee under such mortgage, deed of trust or assignment and their successor(s) and assign(s).
The tern "Lessee" refers to and means the Lessee named in the Lease and also Lessee's successor(s) and assign(s).This
Guaranty may be assigned by Lessor voluntarily or by operation of law.
In the event any action be brought by said Lessor against Guarantor(s) hereunder to enforce the obligation of Guarantor(s)
hereunder, the unsuccessful party in such action shall pay to the prevailing party therein a reasonable attorney's fee which shall be
fixed by the court.
This Guaranty shall be governed by and construed in accordance with the laws of tie State of California. Harty provision of
this Guaranty is determined to be illegal of unenforceable, all other provisions hereof will remain in full force and effect and shall in
no way be affected, impaired or invalidated.
This Guaranty shall constitute the entire agreement between Guarantor and Lessor with respect to the subject matter hereof
and it is understood and agreed that the provisions hereof may only be modified by a writing executed by the parties hereto.
Executed at
William J. Jackson
on
Address
"GUARANTOR(S)"
ADDENDUM
THIS ADDENDUM with Paragraphs 50-57 shall become incorporated into the Lease dated December
14, 2010 between Princeland Properties (International), Inc. as Lessor and Sportswear Resources, Inc. as
Lessee. Notwithstanding anything to the contrary contained herein or in the Lease, in the event of any
inconsistency between the terms of this Addendum and the body of the Lease, the terms of this
Addendum shall control:
50. AIR CONDITIONING MAINTENANCE CONTRACT: Lessor will procure a quarterly filter change
contract for the HVAC and Lessee agrees to reimburse Lessor for the proportionate share on a quarterly basis
for each 1-IVAC unit. Charges shall be reasonable and competitive. Current HVAC filter charge shall be
$15.00 per unit, for a total of $30.00 per quarter, please see sections 7.1(a) and 7.1(b).
51. EARLY POSSESSION: Lessor and Lessee mutually agree that upon a fully executed lease, receipt of a
correct certificate of insurance , first months rent, security deposit and sign deposit Lessee may have possession
of the afore mentioned space.
52. RENTAL INCREASE: Lessee and Lessor mutually agree that the monthly base rent payable under
paragraph 1.5 of the attached lease shall be as scheduled:
January I, 2011 -December 31, 2011:
January 1, 2012 - December 31, 2012:
January 1, 2013 - February 28, 2014:
$7959.00
$8356.95
$8754.90
53. RENTAL ABATEMENT: Lessee and Lessor mutually agree that the rent for the months of February and
March 2011 shall be abated. All other charges and provisions will apply during the abated rental months.
54. TENANT IMPROVEMENTS: Lessor at its sole cost and expense, shall complete the following tenant
improvements prior to Lease commencement or as soon as reasonably possible. Lessee must submit an
agreeable schedule with Lessor in writing within 60 days of Lease commencement or Lessee shall forfeit this
concession.
1. Paint interior of the office and warehouse - color to be Swiss Coffee
2. Professionally clean carpet
Lessee shall have the right, at its expense, to modify the existing office area with Lessors PRIOR written
approval. Lessee shall provide all plans, permits, evidence of License and Insurance for contractors, any
necessary environmental and governmental approvals and construction schedule before commencement of
work. Lessee shall also provide all lien releases and waivers upon completion of work. At Lessor's option,
Lessee may be required to restore the unit to its original configuration upon Lease expiration.
55. LANDSCAPE CHARGE: Lessor agrees to maintain landscaping and Lessee agrees to reimburse Lessor
for a proportionate share on a monthly basis. Charges shall be reasonable and competitive. Current charges
shall be $75.00 per month.
56. FIRE SPRINKLER CHARGE: Lessor agrees to pay the water bill for the fire sprinkler system and Lessee
agrees to reimburse Lessor for a proportionate share on a monthly basis. Charges shall be reasonable and
competitive. Current charges shall be $33.00 per month.
57. TERMINATION OF LEASE: Lessee shall have until 5:00PM January 31, 2011 in order to obtain approval
for its use from the City of Huntington Beach. Should its use not be approved then Lessee may terminate this
Lease by giving written notice, which must be received by Lessor no later than 5:00 PM January 31, 2011.
Should Lessee terminate this Lease then Lessee's prepaid deposits, rent and additional charges(totaling
$18,097.00) shall be forfeited, completely non-refundable, and remain the property of Lessor. Upon Lessor's
receipt of Notice of Termination from Lessee, the parties shall have no further obligation to each other
whatsoever.
INITIALS:
ADDENDUM
PAGE I OF I
Department of Planning & Building
2000 Main Street
Huntington Beach, CA 92648
Phone: (714) 536-5241 Fax: (714) 374-1647
16792
16812
Gotha'rd St,
APN 142-501.11
a i . . .
Num Street
Job Address 16662 Gothard St :,
Zoning IG
File Number CofO?
02006-004092` Yes
02007-000123 Yes
02007-000159' 'Yes
02007-000160 Yes p
02007-000161 Yes
02007.000162. Yes
02007-000163 Yes
02007-000165 Yes
02007-000898 Yes
02007-003723 Yes
02007-005893 Yes
B2007-006978 Yes
Unit, ;Bld
Occupancy Application
of Tract
NOTE: Permit Type 'COMBO' not available for Commercial projects.
Entered By
Default Inspector.,
rmit Type
Tavakoli, Jasmine
Hamlett, Brandon
Building
Origin Counter
Building Use - City
Building Use - County
C-MISC [Commerclal Misc;°
34.1
Internal Notes
•0
CofO Number
Issued By
CofO Date issued.
Utility Release Date N
License Number
002007.006978
T,vakolt, Jasrni
01115/7008.
CofO Type Permanent
CofO Status Issued
Temp. CofO Issued
Temp. COFO Expiration
A267055.
Business Name TIRE & WHEEL CHOICES INC
Business Type, Manufacturing 1 Whol
Business Phone
Proposed Use ° OFFICE/AUTO REPAIR
Former Use',OFFICEIWAREHOUSE
CondlUoins****PER 2007 CBC: B & S-1 OCCUPANCY***
Change of Owner?
o ..
Group
B
B ..,2
S-1
Additional Occupant?
'Change of Occupant?
Change of Use?
Description
OFFICE
OFFICE
AUTO REPAIR
Contractor
CA
Drinking / Dining > 50 Occupants?
Welding f Open Flame?
Automobile Repairs?
Group Definiti A building or structure, or a portion thereof, for office, professional or service-type transactions, including storage oftaload of less th n 50.records and accounts; eating and drinking establishments with an occupan
Type
Property Owner
Property Owner
Contractor
Business Owner.
Tenant
Approved Occupied Area (Sq Ft) 13,265.00
of Stortes1 1
Elec. Available?
Want Electricity On?
Sprinklered?
Dust / Wood? 'Auto Parts Aese.
Construction Type Occupancy Load
36
36
19
nira: tor, Designer c;r
Designer / Engineer
Name PRINCELAND PROPERTIES
Company
Address 26039 ACERO #101
City I State /Zip MISSION VIEJO
Email,
Phone (949) 380-7516 x
INT T I • DEMO WALLS 8 RE-BUILD (N) WALL, INCLDS NEW ROLL-OP DOOR FOR TIRE & WHEEL CHOICES INC"' SUP ADD NEWDescription HUNG CEILING SYSTEM (SEE REV PLANS APPROVED BY DHL) - JT 10118107--FIELD REV INCLDS INTERIOR WALL 8' X4T BETWEEN
WAREHOUSE & SHOWROOM, 1 HR FLICK & $1500 CONST VAL FOR WALL), 112103107. RD- TO INCLUDE (FORMERLY) 16692 GOTHARO^•
•"NEW C OF 0 IN FILE (FOR 8/5.1 OCCUPANCY)- -PLANS SENT TO MICROFILM -1/15/08 JT^
Area:
3600
3600
9665
Choose Prim All
Shy is to Is,uc
Single C0
APN 142-501=11
ApnFr st:on F/indcn
Date Entered' 09/20}7
Status Finaled
Issue Permit? ,Date09/20/2007
Issued By Permitl
Planner Beckman, Hayden
New Building?, Plan Checker Lee, Daniel
Foes %a, rid Payments
Inscecticns
RD !3214•
Block
Date Printed
01/15/2008
Click the ce button to copy the Business Licenseinformation into the Certificate of Occupancy.
Business Licenses BusineSS,Name
A257914 CALIFORNIA COMMERCIAL INVES*
A088038 TATE ACCES- SYSTEMS
A147806 NEWPORT WINDOW FASHIONS
A173906 TRIBE HOLDING CORP
92691
Fax; ( ) -
Same As
Mobile Phone
Pager
( ) -
State License Type
Seff Insured / Non-Employer?
a Override Contractor
Expiration Oates?,
Date Overridden
Overridden By
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Gonzales, Andrew
From: Bill Jackson [bill@purefastpitch.com]
Sent: Monday, January 24, 2011 11:10 PM
To: Gonzales, Andrew
Subject: Re: Pure Fastpitch
Attachments: SKMBT_60110122213200.pdf; ATT00866.htm
Andrew,
Thank you for the email. I have answered your questions and I hope this helps you understand our project.
Please see my responses in red.
On Jan 24, 2011, at 4:36 PM, Gonzales, Andrew wrote:
Bill,
There are a couple of items that I need to have cleared up prior to acting on your application. The questions and issues I
have are related to the property owner verification information provided, project plans, and narrative. The following
issues are listed as follows:
1. On the application form, it difficult to decipher what the property owner is authorizing. The application is blank and
one could argue that the property owner may not have authorized your project request. Can you have the property
owner sign the submitted application form containing your signature or have the owner provide a very brief
letter/email to me confirming their authorization of the application/project request.
The original application had a second page with the signature. I have included an atatchement of my lease
which spells out the intended use as a sports training facility. Please see attatchement.
1
• • Page 1 of 2
2. The project plans are missing some critical items of information which are needed to fully
complete my plan check. The plans should be fully dimensioned with a development matrix
providing the square footage break down of the total office areas, showrooms, instructional
areas (i.e., running, pitching, fielding, hitting areas, etc), and communal areas.
The training area is broken down like this:
Hitting 1,908 SQ Ft
Pitching 1,500 SQ Ft
Running & conditioning 1616 Sq ft
1-iciding 2,236 Sq ft.
Total training area is 7,260 Sq Ft this equals 55% of the total space of 13,265
Total Office area is 625 Sq ft.
Front desk and showroom is 800 sq ft.
Parent waiting area is 850 Sq. Ft.
The remaining area is storage for our supplies needed to run camps. 2,000. Sq ft.
3. The project narrative shall identify the maximum number of students intended to be served
by the facility during its peak period. Furthermore, the depicted retail area within the facility
must be noted not to provide direct sales to the general public. Any retail shall be strictly
limited to the students utilizing the facility because direct retail sales to the public is
prohibited within this zoning district.
Pure Fastpitch specializes in private instruction in the sport of girls fastpitch softball. We train athletes
o of all ages from 6-20 years in pitching hitting and fielding. Pure fastpitch is involved in college
5 recruiting and helps many local players recieve scholarships in the sport of softball. The expansion of
our business means that we should be able to train in a group format and this facility should safely
5`yv ' handle as many as 25-35 athletes at one time. Due to the nature of our business we generally work with
one or two clients at a time during the early afternoon hours and then may have teams coming in
usually after 6 pm. Our busiest hours will be from 6-9 pm.
Our retail will be a pro shop environment that will provide support to teams with uniforms helmets,
cleats, bats etc.. strictly caterin 1 o our training customers.
Please provide me with information at your earliest convenience. If you have any questions, call
me at the number listed below or via email.
Andrew Gonzales, Associate Planner
City of Huntington Beach
Planning & Building Department
2000 Main Street
Huntington Beach, CA 92648
Office - 714.374.1547
Fax - 714.374.1540
agonzales surfcit -hb.or
flea/C:1Doculnents and Settings \gonzalea\Local Settings \Temporary Internet Files \Conten ... 1/25/2011
Page 2 of 2
P Please consider the environment before printing this message
-----Original Message-----
From: Bill Jackson [mailto:bill@purefastpitch_com]
Sent: Monday, January 24, 2011 12:23 PM
To: Gonzales, Andrew
Subject: Pure Fastpitch
Andrew,
I just wanted to touch base on Administrative permit # 10-219 for
16662 Gothard Street. When we last talked you felt this would be
addressed this tuesday, if so how do I find out if I can proceed with
permits?
Is it possible for you to send me an email?
Thanks
Bill Jackson
714-720-3882
file://C:\Documents and Settings\gonzalea\Local Settings\Temporary Internet Files\Conten... 1/25/2011
Gonzales, Andrew
From: Gonzales, Andrew
Sent: Monday, January 24, 2011 4:36 PM
To: 'Bill Jackson'
Subject: RE: Pure Fastpitch
Bill,
There are a couple of items that I need to have cleared up prior to acting on your application. The questions and issues I
have are related to the property owner verification information provided, project plans, and narrative. The following
issues are listed as follows:
1. On the application form, it difficult to decipher what the property owner is authorizing. The application is blank and
one could argue that the property owner may not have authorized your project request. Can you have the property
owner sign the submitted application form containing your signature or have the owner provide a very brief
letter/email to me confirming their authorization of the application/project request.
2. The project plans are missing some critical items of information which are needed to fully complete my plan check.
The plans should be fully dimensioned with a development matrix providing the square footage break down of the
total office areas, showrooms, instructional areas (i.e., running, pitching, fielding, hitting areas, etc), and communal
areas.
3. The project narrative shall identify the maximum number of students intended to be served by the facility during its
peak period. Furthermore, the depicted retail area within the facility must be noted not to provide direct sales to
the general public. Any retail shall be strictly limited to the students utilizing the facility because direct retail sales to
the public is prohibited within this zoning district.
Please provide me with information at your earliest convenience. If you have any questions, call me at the number
listed below or via email.
Andrew Gonzales, Associate Planner
City of Huntington Beach
Planning & Building Department
2000 Main Street
Huntington Beach, CA 92648
Office - 714.374.1547
Fax - 714 .374.1540
a onzales surfcit -hb.or
P Please consider the environment before printing this message
-----Original Message-----
From: Bill Jackson [mailto:bill@purefastpitch.com]
Sent: Monday, January 24, 2011 12:23 PM
To: Gonzales, Andrew
Subject: Pure Fastpitch
Andrew,
I just wanted to touch base on Administrative permit # 10-219 for
16662 Gothard Street. When we last talked you felt this would be
addressed this tuesday, if so how do I find out if I can proceed with
permits?
Is it possible for you to send me an email?
Thanks
i
Bill Jackson
714-720-3882
2
Certificate of Occu anc No. 0200
714/536-5271
APPLICATION FOR CERTIFICATE OF OCCUPANCY
CITY OF HUNTINGTON BEACH - DEPT. OF BUILDING & SAFETY
(3rd Floor - Must Apply In-Person)1 4-
Business License #05 S
Business Address (OCI.6,L T t, T.
Business Owners Name A
Business Name r?. e, 6 vu rue
Business Type -AC(f's 0'a
Date et. / "9-
Zip Code o! 9
Telephone No.3o qd-7- 3&/ 98
Bus. Phone 3'i-3 -TV-'5 - a
Pro ert Owner Information (required), Tenant/Emer enc Contact (required)
Name ' `• (rJ I t l?(. CName I INto N
Address a 03 L i 61 Home Address 7- A M 3 56
City v 2 State/Zip s-11 City r - eco T State/Zip SaE.c
Telephone No. °I 61 1 .-Y Telephone No. 10:T 1-Gt -3 L.1:cg
THIS USE WOULD BE DESCRIBED AS:
Newly Constructed Building or
/
Q Existing Building
CHECK ALL THAT APPLY:
Change of Property Owner Change of Occupant Change of Use Additional Occupant
tc.L ` Indicate former type of business lullrlGaati A.--12>
Are you requesting that the electricity be turned on? YesQNqj
Is the building sprinklered ? Yes flo
Will operations produce dust/wood shavings or similar material? YesQNoN
Will operations involve the repair or replacement of automobile parts Yes No If yes: Describe the
components repaired or replaced.,,y?a6i4 -,t %t d j
Does the operation involve the use of welding or open flame? Yes No 9-1
Will the business be a drinking, dining or assembly use with an occupant load of more than 50 persons?
Yes QNo t
The following best describes my operation: Office Only Retail Sales Medical/Dental
Restaurant/Take Out Food /< Warehouse /Manufacturing/Distribution
(describe process and end product)
Other (describe)
For O icial Use Onl
Occ Group: Area: b o 0 Occ Load:
Occ Group: S Area: t'1 Occ Load : X
Occ Group: Area: Occ Load:
Total Sq Ft Occupied: 132 b5 No. of Stories: I TIF Review: Y/
Bldg. Permit # Entitlement #: Zoning:
Plnr Initials: Date:e •11"f{' Plan Chkr Initials I'Date: Insp Initials: 1114- Date: O f3_
Conditions of Approval or Other Notes:
15T9AVjV71O0 V W l,ESk G U0 lL
Inspection Date:v-
(G:Building/Forms/document id goes here)Z 1