L-C TO BE REESTABLISHED IN THE
REQUIRED L-C AMOUNT, THEN TENANT'S MONTHLY INSTALLMENT OF BASE RENT SHALL BE
INCREASED BY TWO HUNDRED PERCENT (200%) OF ITS THEN EXISTING LEVEL DURING THE
PERIOD COMMENCING ON THE DATE WHICH IS NINETY (90) DAYS AFTER THE DATE OF SUCH
REESTABLISHMENT NOTICE AND ENDING ON THE DATE SUCH L-C IS
RE-ISSUED/REESTABLISHED PURSUANT TO THE TERMS OF THIS SECTION 21.2. THE PARTIES
AGREE THAT IT WOULD BE IMPRACTICABLE AND EXTREMELY DIFFICULT TO ASCERTAIN THE
ACTUAL DAMAGES SUFFERED BY LANDLORD AS A RESULT OF TENANT'S FAILURE TO TIMELY
REESTABLISH THE L-C FOLLOWING THE REESTABLISHMENT NOTICE AS REQUIRED IN THIS
SECTION 21.2, AND THAT UNDER THE CIRCUMSTANCES EXISTING AS OF THE DATE OF THIS
LEASE, THE LIQUIDATED DAMAGES PROVIDED FOR IN THIS SECTION 21.2.3 REPRESENT A
REASONABLE ESTIMATE OF THE DAMAGES WHICH LANDLORD WILL INCUR AS A RESULT OF SUCH
FAILURE, PROVIDED, HOWEVER, THAT THIS PROVISION SHALL NOT WAIVE OR AFFECT
50
LANDLORD'S RIGHTS AND TENANT'S INDEMNITY OBLIGATIONS UNDER OTHER SECTIONS OF
THIS LEASE (EXCEPT THAT THE PARTIES SPECIFICALLY AGREE THAT THE FOREGOING
PROVISION WAS AGREED TO IN LIEU OF MAKING FAILURE TO RE-ESTABLISH THE L-C A
DEFAULT UNDER THE LEASE).
THE PARTIES ACKNOWLEDGE THAT THE PAYMENT OF SUCH
LIQUIDATED DAMAGES IS NOT INTENDED AS A FORFEITURE OR PENALTY WITHIN THE MEANING
OF CALIFORNIA CIVIL CODE SECTION 3275 OR 3369, BUT IS INTENDED TO CONSTITUTE
LIQUIDATED DAMAGES TO LANDLORD PURSUANT TO CALIFORNIA CIVIL CODE SECTION 1671.
THE PARTIES HAVE SET FORTH THEIR INITIALS BELOW TO INDICATE THEIR AGREEMENT WITH
THE LIQUIDATED DAMAGES PROVISION CONTAINED IN THIS SECTION 21.2.3.
/s/ JCH
/s/ SS
/s/ JPL
LANDLORD'S INITIALS
TENANT'S INITIALS
21.2.4
APPLICATION OF LETTER OF CREDIT.
THE L-C SHALL BE HELD
BY LANDLORD AS SECURITY FOR THE FAITHFUL PERFORMANCE BY TENANT OF ALL THE TCCS
OF THIS LEASE TO BE KEPT AND PERFORMED BY TENANT DURING THE LEASE TERM.
THE L-C
SHALL NOT BE MORTGAGED, ASSIGNED OR ENCUMBERED IN ANY MANNER WHATSOEVER BY
TENANT WITHOUT THE PRIOR WRITTEN CONSENT OF LANDLORD.
IF TENANT DEFAULTS WITH
RESPECT TO ANY PROVISIONS OF THIS LEASE, INCLUDING, BUT NOT LIMITED TO, THE
PROVISIONS RELATING TO THE PAYMENT OF RENT, OR IF TENANT FAILS TO RENEW THE L-C
AT LEAST THIRTY (30) DAYS BEFORE ITS EXPIRATION, LANDLORD MAY, BUT SHALL NOT BE
REQUIRED TO, DRAW UPON ALL OR ANY PORTION OF THE L-C FOR PAYMENT OF ANY RENT OR
ANY OTHER SUM IN DEFAULT, OR FOR THE PAYMENT OF ANY AMOUNT THAT LANDLORD MAY
REASONABLY SPEND OR MAY BECOME OBLIGATED TO SPEND BY REASON OF TENANT'S DEFAULT,
OR TO COMPENSATE LANDLORD FOR ANY OTHER LOSS OR DAMAGE THAT LANDLORD MAY SUFFER
BY REASON OF TENANT'S DEFAULT.
THE USE, APPLICATION OR RETENTION OF THE L-C, OR
ANY PORTION THEREOF, BY LANDLORD SHALL NOT PREVENT LANDLORD FROM EXERCISING ANY
OTHER RIGHT OR REMEDY PROVIDED BY THIS LEASE OR BY LAW, IT BEING INTENDED THAT
LANDLORD SHALL NOT FIRST BE REQUIRED TO PROCEED AGAINST THE L-C AND SHALL NOT
OPERATE AS A LIMITATION ON ANY RECOVERY