Document:

Ex-10.30

 

Exhibit 10.30

MEMORANDUM OF AGREEMENT

OF LEASE

between

ROSENPARK EIENDOMME CC

(“LESSOR”)

and

QUINTILES CLINDEPHARM

(PTY) LIMITED

(“LESSEE”)

 

 

MEMORANDUM OF AGREEMENT OF LEASE

(hereafter called “the AGREEMENT”)

(Offices)

The AGREEMENT made and entered into by and between

ROSENPARK ElENDOMME CC, CK94/01945/23

herein represented by LAMBERTUS JACOBUS VAN ZYL

he being duly authorised thereto

(hereafter called “the LESSOR”)

and

QUINTILES CLINDEPHARM (PTY) LIMITED

Reg. No. 95/00823/07

herein represented by WILLEM STEFANUS CONRADIE

he being duly authorised thereto

(hereafter called “the LESSEE”)

The LESSOR hereby lets to the LESSEE and the LESSEE hereby hires the
PREMISES (as hereafter defined under the heading “PREMISES”) situate in the
BUILDING (as hereafter defined under the heading “BUILDING”) on the terms
and conditions as recorded in this AGREEMENT and the annexures referred to
below.

	 	 	 	 	 	 	 
	1.	 	
PREMISES	 	 	 	 
	 	 	 	 	 	 	 
	 	 	
Identification
	 	:
	 	ERF NO. 31282 BELLVILLE
	 	 	 	 	 	 	 
	 	 	
Floor
	 	:
	 	PORTION FIRST FLOOR
	 	 	 	 	 	 	 
	 	 	
See annexure “G” (Premises as demarcated)
(hereafter called “the PREMISES”)	 	 	 	 
	 	 	 	 	 	 	 
	 	 	
Name of Building
	 	:
	 	“MONTROSE PLACE”
	 	 	 	 	 	 	 
	 	 	
Address of Building
	 	:
	 	2 BELLA ROSA STREET,
	 	 	 	 	 	 	 
	 	 	
(hereafter called “the BUILDING”) ROSENPARK, BELLVILLE	 	 	 	 

 

 

2

	2.	 	PERIOD

	 	2.1	 	 This AGREEMENT shall endure for a period of FIVE (5) YEARS

(hereafter called “the LEASE PERIOD” and “the INITIAL
PERIOD”)
	 
	 	 	 	and shall commence on the 1ST day of APRIL 2000
	 
	 	 	 	and shall terminate on the last day of MARCH 2005
	 
	 	2.2	 	 OPTION TO RENEW (Refer to Annexure B)
	 
	 	 	 	commencing on
1ST APRIL 2005 and terminating on
31ST MARCH 2010

(hereinafter referred to as “the RENEWAL PERIOD”)

	3.	 	BASIC RENTAL

	 	3.1	 	The LESSEE shall during the currency of the LEASE PERIOD pay
the following basic rental per month (exclusive of VAT) to the LESSOR.
	 
	 	 	 	The gross lettable area being approximately 403m2 @ R53-00/m2;

	 	 	 	 	 
	 	 	
01/04/2000 – 31/03/2001
	 	R21 359-00 (Twenty One Thousand Three
Hundred and Fifty Nine Rand) per month;
	 	 	 	 	 
	 	 	
01/04/2001 – 31/03/2002
	 	R23 708-49 (Twenty Three Thousand
Seven Hundred and Eight Rand Forty
Nine Cents) per month;
	 	 	 	 	 
	 	 	
01/04/2002 – 31/03/2003
	 	R26 316-42 (Twenty Six Thousand Three
Hundred and Sixteen Rand Forty Two
Cents) per month;
	 	 	 	 	 
	 	 	
01/04/2003 – 31/03/2004
	 	R29 211-23 (Twenty Nine Thousand Two
Hundred and Eleven Rand Twenty Three
Cents) per month;
	 	 	 	 	 
	 	 	
01/04/2004 – 31/03/2005
	 	R32 424-47 (Thirty Two Thousand Four
Hundred and Twenty Four Rand Forty
Seven Cents) per month;

	 	3.2	 	 ADDITIONAL COSTS (per month)
	 
	 	 	 	 
	 

	 	3.2.1 	 	Contribution for electricity consumed on the PREMISES
(see
Annexure A clause 4)                                                  
Sub-metered
	 
	 	3.2.2	 	Contribution to water consumed
(see
Annexure A clause 9)                                                  
                                                           22.41 %
	 

	 	3.3	 	 STAMP DUTY (See Annexure A clause 31)
	 
	 	3.4	 	DEPOSIT (See Annexure A clause 42)

 

 

3

	4.	 	GENERAL

	 	4.1	 	The Lessor shall at its own expense and prior to
the lease commencement date modify the premises to align with the attached
plan marked Annexure “G” which includes all alterations to existing
partitioning, repainting of plastered walls, air-conditioning utilising
console units and the existing ceiling cassette unit, re-locating of
existing lightfittings and power points and additional power
requirements.
	 
	 	4.2	 	Parking – 9 undercover parking bays at R300-00 per bay per month
(VAT excluded) has been allocated to the Lessee, which monthly
rental shall escalate by 11% compound per annum.
	 
	 	4.3	 	The Lessor will give the Lessee a first right of refusal to any space
that becomes available for leasing on the same floor. The
rental for such additional space shall be estimated according to the then
fair market related rentals.

	5.	 	PURPOSE FOR WHICH PREMISES SHALL BE USED

(see also Annexure A clause 10)

	 	 	 	 	 	 	 
	 	 	
Type of business
	 	:
	 	ADMINISTRATIVE OFFICES FOR

PHARMACEUTICAL COMPANY
	 	 	 	 	 	 	 
	 	 	
Specific exclusions
	 	:
	 	ANY OTHER ACTIVITIES NOT RELATED TO THE

ABOVE

	6.	 	SHAREHOLDERS / MEMBERS / PROPRIETORS / PARTNERS

(see also Annexure A clause 29)
	 
	 	 	AS PER ATTACHED LETTER.
	 
	7.	 	LESSOR’S DOMICILIUM AND PLACE OF PAYMENT

	 	7.1	 	The LESSOR’s domicilium citandi et executandi for all
purposes under, arising from, and applicable to this AGREEMENT is 3rd Floor, 5 High
Street, Rosenpark, Bellville, 7530 or such other address as the
LESSOR may from time to time appoint in writing.
	 
	 	7.2	 	Rental and all other monies payable by the LESSEE to the LESSOR in
terms of this AGREEMENT, shall be paid to the LESSOR, free of any
deductions, at 3rd Floor, 5 High Street, Rosenpark, Bellville, 7530
or such other address as the LESSOR may from time to time appoint in writing.

 

 

4

	8.	 	ANNEXURE/S AND DEFINITIONS

	 	8.1	 	The following annexure/s form part of this AGREEMENT:

	 	 	 	 	 
	Annexure/s	 	
:
	 	“A”, “B”, “C”, “D”, “E”, “G”

	 	 	 	Any reference in this AGREEMENT or the aforesaid Annexure/s to this
AGREEMENT shall also include a reference to the Annexure/s
aforementioned.
	 
	 	8.2	 	The words and expressions defined above shall not be limited to the
relevant definition but shall, where applicable, be supplemented as set
out in Annexure A clause 1.

THUS DONE AND SIGNED BY / ON BEHALF OF THE LESSEE AT CENTURION
ON THIS 18th DAY OF FEBRUARY 2000.

AS WITNESSES:

	 	 	 
	
1.   /s/ [illegible]	 	/s/ Quintiles Clindepharm (Pty) Limited
	 	 	LESSEE
	 	 	 
	
2.   /s/ [illegible]	 	GENERAL MANAGER
	 	 	CAPACITY

THUS DONE AND SIGNED BY / ON BEHALF OF THE LESSOR AT BELLVILLE ON THIS
13th DAY OF MARCH 2000.

AS WITNESSES:

	 	 	 
	1.   /s/ [illegible]	 	
/s/ Lambertus Jacobus Van Zyl
	 	 	
LAMBERTUS JACOBUS
	 	 	
VAN ZYL IN HIS
	 	 	
CAPACITY AS DIRECTOR
	 	 	 
	2.   /s/ [illegible]	 	 

 

 

ANNEXURE A

GENERAL CONDITIONS OF THE AGREEMENT

	1.	 	DEFINITIONS
	 
	 	 	In this AGREEMENT, unless the context indicates otherwise:

	 	1.1	 	“the PREMISES” means the PREMISES let in terms of this AGREEMENT and all the LESSOR’s fixtures,
fittings, appliances, equipment and electrical and sanitary installations therein and appertaining thereto;
	 
	 	1.2	 	“the BUILDING” means the BUILDING of which the PREMISES form part;
	 
	 	1.3	 	“the PROPERTY” means the BUILDING together with the land on which it is situated;
	 
	 	1.4	 	Words in the singular shall include the plural and vice versa;
	 
	 	1.5	 	Words referring to the male gender shall include the female gender and vice versa;
	 
	 	1.6	 	The impersonal pronoun shall include the masculine or female pronouns;
	 
	 	1.7	 	Words referring to individual persons shall include firms,
associations, companies, partnerships and corporate
bodies, and vice versa;
	 
	 	1.8	 	Any reference to the period, currency, unexpired period, termination or date of termination of this
AGREEMENT, shall include any renewal or extension thereof;
	 
	 	1.9	 	Any reference to the LESSOR shall include the LESSOR and its successors in title and their respective
agents, employees, architects, project co-ordinators, contractors and workmen;
	 
	 	1.10	 	Any reference to the LESSEE shall include the LESSEE’s agents, employees, servants, customers, clients,
licensees, contractors, invitees, visitors and guests;

	 
	 	1.11	 	For purposes of paragraph 2.1 the lettable area of the PREMISES will be calculated in terms of the guidelines
laid down by SAPOA (the South African Property Owners Association).

	2.	 	GENERAL

	 	2.1	 	The headings to the clauses in this AGREEMENT are for reference
purposes only and shall not affect the
interpretation of the provisions to which they relate.

	3.	 	PAYMENTS OF AMOUNTS DUE

	 	3.1	 	The LESSEE shall pay without demand the basic rental as well
as any increases in the basic rental (see
clause 5 hereafter) and any other amounts which may become due and payable in terms of this
AGREEMENT, monthly in advance on or before the first day of each calendar month during the then ruling
office hours of the LESSOR, free of bank exchange and other charges, at the address of the LESSOR stated
in the AGREEMENT or such other address of which the LESSOR may from time to time notify the LESSEE in
writing.
	 
	 	3.2	 	Subject to the provisions of clause 4 of the AGREEMENT, the LESSOR shall be liable for the cost of
alterations to the PREMISES, deviations from the BUILDING plans and
additional installations which may be
installed.

	4.	 	COSTS OF ELECTRICITY CONSUMPTION

	 	4.1	 	The LESSEE shall pay the costs, including any cost increase as the
result of an increase in the tariff, levies or
other costs of electricity supply, in connection with the
consumption of electricity on the PREMISES on the basis as set out
in sub-clauses 4.1.1 or 4.1.2, as the case may be;

	 	4.1.1	 	If the PREMISES is serviced by a separate meter
its reading shall be prima facie proof of the
electricity consumption on the PREMISES and the LESSEE shall pay the costs thereof to the
supplier of electricity at the time and in the manner determined by the supplier.
	 
	 	4.1.2	 	If the PREMISES is serviced by its own sub-meter its reading shall be prima facie proof of the
electricity consumption on the PREMISES and the LESSEE shall
pay the costs thereof to the
LESSOR. If the PREMISES is serviced jointly with other
PREMISES by a sub-meter the said costs
shall be calculated pro rata to the area which the sub-meter
serves, on the same tariff, levies and
costs which would have applied to the LESSEE had the supplier
supplied electricity to the PREMISES direct.

 

 

	 	 	 	 	 	 	 
	 	 	 	
2	 	 	ANNEXURE A

	 	4.1.3	 	
If the PREMISES is not serviced by a sub-meter, then the LESSEE shall monthly pay an amount
equal to RX where
	 
	 	 	 	Rx  =  (A-B) x C /  D

	 	 	 	 	 	 	 
	 	 	  and
	 	A=
	 	the total electricity account payable by the LESSOR in respect of the
PROPERTY;
	 	 	 	 	 	 	 
	 	 	 	 	B =
	 	the total amount payable by LESSEE’s whose PREMISES are serviced by
sub-meters;
	 	 	 	 	 	 	 
	 	 	 	 	C =
	 	the lettable area of the PREMISES;
	 	 	 	 	 	 	 
	 	 	 	 	D=
	 	the total lettable area of the BUILDING less the lettable areas of the
PREMISES serviced by sub-meters.

	 	4.1.4	 	If no PREMISES in the BUILDING is serviced by a
separate sub-meter the LESSEE shall pay the
amount indicated against “Contribution for electricity consumed on the PREMISES” in the
AGREEMENT or an amount represented by the percentage indicated there-against of the total
monthly electricity account including any cost increases as the result of an increase in the tariff,
levies and other costs of electricity supply.

	 
	 	4.2	 	
The LESSOR shall be entitled to charge a service fee in connection with the reading of sub-meters which
service fee shall be payable by the LESSEE where the levy of such fee has been approved by the relevant
electricity supplier.
	 
	 	4.3	 	Unless specifically otherwise stated the costs of electricity consumption shall be payable monthly to the
LESSOR forthwith on receipt by the LESSEE of an account.

	5.	 	INCREASE IN RENTAL AND CONTRIBUTION TO COSTS

	 	5.1	 	In the event of the assessment rates and taxes or any
other rates payable by the LESSOR in respect of the
PROPERTY being increased during the LEASE PERIOD as a result of
an increase in the tariff, a re-evaluation
of the PROPERTY or any other increase, the monthly rental shall
increase from the date on which such
increase becomes effective. The LESSOR shall calculate the
additional monthly rental which the LESSEE
shall pay as a result of the increase by multiplying the annual
increase by the percentage indicated against
“LESSEE’s contribution to increase (per month)” in the AGREEMENT
and dividing it by twelve (12). (The pro
rata share currently amounts to approximately 20c/m2)
	 
	 	 	 	The LESSEE shall pay a pro rata portion of any costs which the
LESSOR may incur in an attempt to obtain a reduction in
respect of PROPERTY rates from the local authority. The LESSOR
shall calculate the pro rata portion by multiplying the total
costs by the percentage indicated against “LESSEE’s
contribution to increases (per month)” in the AGREEMENT.
	 
	 	5.2	 	The LESSOR shall advise the LESSEE in writing of any
increase in rental payable by the LESSEE to the
LESSOR pursuant to the provisions of sub-clause 5.1 above, whether with retro-active effect or not. In the
event of any Stamp Duty being payable to the Receiver of Revenue in respect of such written notice, the
LESSEE shall be liable for payment thereof to the LESSOR on demand.
	 
	 	5.3	 	The provisions of sub-clauses. 5.1 and 5.2 above shall mutatis mutandis apply to any increase in respect of
assessment rates and taxes, and other rates referred to in sub-clause 5.1 of which the LESSOR receives
notice from the relevant authority at any time after the rental stated in the AGREEMENT has been agreed to
but prior to the commencement date of the LEASE PERIOD, subject to whether this AGREEMENT had been
signed by or on behalf of the LESSOR and/or LESSEE as at the date of such notice to the LESSOR.
	 
	 	5.4	 	Security - It is recorded that in the event of the LESSOR deciding to upgrade the security of the complex inter
alia by the installation of C.C.T.V. cameras the Lessee’s prior
approval will be obtained and if in agreement,
the LESSEE will be obliged to contribute pro rata to the cost
thereof. Such costs will be limited to a maximum
of 3% of the lease amount per month.

	6.	 	DEFAULT IN PAYMENT OF AMOUNTS DUE

	 	6.1	 	If the LESSEE fails to pay the rental or any other amount for which he is liable in terms of this AGREEMENT
on the due date for such payment, the LESSOR may charge interest on the total amount outstanding from
time to time at a rate equal to the prime lending rate of the First
National Bank South Africa applicable from

 

 

	 	 	 	 	 
	 	 	
3
	 	ANNEXURE A

	 	 	 	time to time plus three percent (3%). Interest will be
calculated on each amount from and including the due date for
payment thereof until such amount has been paid in full. If
interest is raised by the LESSOR then any payment made by the
LESSEE shall firstly be utilised in payment of interest and any
balance remaining in reduction in full or in part of the amount
in arrears. Any excess payment shall thereafter be credited to
the current liability of the LESSEE.
	 
	 	6.2	 	If the LESSEE fails timeously to pay any amount for which he
is liable to a local authority or any other party
direct, the LESSOR may on behalf of the LESSEE pay such account and recover that amount together with
interest thereon calculated as set out above.
	 
	 	6.3	 	Failure by the LESSOR to charge interest on any amount in arrears shall in no way prejudice or affect the right
of the LESSOR to charge such interest, whether with retro-active effect or not, at any time thereafter.
	 
	 	6.4	 	Where a reduction in rental has been granted by the LESSOR to the LESSEE, the full amount of such
reduction shall become due upon default by the LESSEE. Reduction
shall include any rebate or credit
arrangements or similar grants.

	7.	 	CANCELLATION OF AGREEMENT OF LEASE

	 	7.1	 	Should the LESSEE fail and/or refuse to effect payment of
rental and/or any other amount payable by the
LESSEE in terms of this AGREEMENT on the due date for payment thereof and/or breach or allow any breach
of any other provision hereof or commit an act of insolvency, the LESSOR shall be entitled, after having given
the LESSEE written notice of the LESSEE’s failure and/or breach aforesaid and demanding payment of the
amount in arrears and/or a remedy of breach and the LESSEE fails and/or refuses to pay the amount in
arrears and/or remedy the breach within 30 (thirty) days after receipt of such notice, to forthwith cancel this
AGREEMENT and to take occupation of the PREMISES without prejudice to any of the LESSOR’s rights in
terms of this AGREEMENT, common law or legislation.
	 
	 	7.2	 	Should the LESSOR cancel this AGREEMENT pursuant to the provisions of sub-clause 7.1 above and the
LESSEE contest the LESSOR’s right so to cancel, the LESSEE shall continue to perform strictly in
accordance with the provisions of this AGREEMENT pending the outcome of the dispute, whether by way of
negotiation or by way of litigation, provided that the LESSEE’s continued occupation of the PREMISES and
performance in terms hereof and, in particular, acceptance by the LESSOR of any payments made by the
LESSEE, shall in no way prejudice or affect the LESSOR’s claim for cancellation which is in dispute.
	 
	 	7.3	 	Notwithstanding the foregoing paragraph 7.1, should the LESSEE persist with late payments in respect of the
monthly rental and other charges aforesaid on more than two (2) occasions during the currency of this Lease
or any extension thereof, then the LESSOR shall have the right without further notice to cancel this
AGREEMENT with reservation of all the LESSOR’s other rights in terms of this AGREEMENT and the
common law.
	 
	 	7.4	 	Should the LESSOR cancel this AGREEMENT pursuant to a breach by the LESSEE, irrespective of the
nature and extent of such breach, the LESSEE shall, and the LESSEE hereby accepts liability, pay to the
LESSOR, over and above any rental and other monies which may be in arrears in terms of this AGREEMENT
as at date of cancellation, an amount equal to

	 	7.4.1	 	rental which the LESSOR would otherwise have received from the LESSEE in terms of this
AGREEMENT for the period reckoned from the date of cancellation to the date upon which the
PREMISES is re-let or the date upon which the LEASE PERIOD would have expired in the normal
course of events, whichever is the earlier;
	 
	 	7.4.2	 	the difference between the rental and other monies which the LESSOR would have received from
the LESSEE in terms hereof and the rental and other monies which the LESSOR will receive from
the new lessee calculated from date of commencement of the new lease to the date upon which the
LEASE PERIOD would have expired in the normal course of events provided that the rental and
other monies receivable in terms of the new lease are less than the rental and other monies which
the LESSEE would have had to pay;
	 
	 	7.4.3	 	a pro rata portion of agent’s commission which the LESSOR may have to pay to any estate agent
based on rental receivable as a result of the conclusion of
the new lease in respect of the PREMISES, calculated from the commencement date thereof to
the date upon which the LEASE PERIOD would have expired in the normal course of events on
the one side and the LEASE
PERIOD of the new lease on the other side.
	 
	 	7.4.4	 	the cost of repair of any damages to the PREMISES;
	 
	 	7.4.5	 	costs incurred by the LESSOR being the
LESSOR’s allowances to install the LESSEE, plus costs,
to be borne by LESSOR, whether partially or in full, to
install the new lessee in the PREMISES;

 

 

	 	 	 	 	 
	 	 	
4
	 	ANNEXURE A

	 	7.4.6	 	any other damages which the LESSOR may
suffer as the result of the premature termination of this
AGREEMENT.

	9.	 	WATER AND OTHER CHARGES

	 	9.1	 	The LESSOR shall be liable for the costs in respect of
water consumed on the PROPERTY save where water
consumed on the PREMISES is measured by a sub-meter. The LESSEE shall monthly pay the cost of his
water consumption according to the sub-meter to the LESSOR. Should the water consumption on the
PREMISES, in the opinion of the LESSOR, be more than normal, the LESSOR may install a sub-meter on the
PREMISES at the expense of the LESSEE to measure the consumption of water on the PREMISES. Should
a sub-meter be installed in respect of the PREMISES in terms of this sub-clause, the LESSEE shall monthly
pay the cost of the water consumed on the PREMISES to the LESSOR. The cost shall be calculated on the
same tariff and levies, which the LESSEE would pay if the supplier supplies the water to him direct.
	 
	 	9.2	 	Notwithstanding 9.1 above and if applicable the LESSEE shall contribute to the LESSOR’s costs in respect of
the monthly consumption of water on the PROPERTY in an amount equivalent to the percentage stated in the
AGREEMENT under ADDITIONAL COSTS which amount shall be payable monthly by the LESSEE to the
LESSOR.
	 
	 	9.3	 	The LESSEE shall be liable for any other charges and levies, which may be imposed from time to time by
municipal and other authorities in respect of the PREMISES and
the business conducted thereon.

	10.	 	PURPOSE FOR WHICH THE PREMISES SHALL BE USED

	 	10.1	 	The PREMISES shall be used for the purpose described in
the AGREEMENT and for no other purpose
without the LESSOR’s prior written consent being had and obtained, which consent shall not be unreasonably
withheld. The LESSEE shall keep the PREMISES open for business during the normal business hours which
apply in the relevant municipal area for the type of business conducted by the LESSEE.
	 
	 	10.2	 	The LESSEE may not -

	 	10.2.1	 	use the PREMISES or allow the PREMISES to be used for residential purposes;
	 
	 	 	 	and
	 			
	 	10.2.2	 	without the prior consent of the
LESSOR being had and obtained, permit any sale by public auction
on the PREMISES.

	11.	 	LESSOR’S HYPOTHEC
	 
	 	 	For the duration of this AGREEMENT all furniture, fittings and fixtures,
equipment, stock, etc., brought onto the PREMISES shall be subject to the LESSOR’s hypothec and shall serve as
collateral security for the proper fulfillment by
the LESSEE of all his obligations in terms of this AGREEMENT. The LESSEE
may not without the prior written approval of the LESSOR, which approval
shall not be unreasonably withheld, pledge or otherwise encumber or
dispose of the aforementioned assets or remove them from the PREMISES
except in the ordinary course of business.

 

 

	 	 	 	 	 
	 	 	
5
	 	ANNEXURE A

	12.	 	DEFECTS
	 
	 	 	Should the LESSEE on taking occupation of the PREMISES find any of the
keys, locks, doors, windows, wash-basins, taps, sanitary conveniences,
drains or down-pipes, electrical or other equipment of the PREMISES in
disrepair, the LESSEE shall notify the LESSOR in writing of all
defects within Forty Five (45) days of taking occupation and the
LESSOR shall take all reasonable steps to repair such defects as soon
as possible. Should the LESSEE fail to give such notice to the LESSOR
the LESSEE shall be deemed to have acknowledged that on taking
occupation of the PREMISES the aforesaid items were received in good
order and condition.
	 
	13.	 	MAINTENANCE

	 	13.1	 	The LESSEE shall keep the interior of the PREMISES in good
order and condition and hereby acknowledges,
subject to the provisions of clause 12 above, that, on taking
occupation, he received the PREMISES in a good
and clean condition and free of insects and rodents. The
LESSEE undertakes to leave the PREMISES in the
same good order and condition, fair wear and tear excepted, on
expiration, or prior termination of this
AGREEMENT or the eventual vacation thereof. The LESSOR will be
responsible for all maintenance to the
exterior of the premises.
	 
	 	13.2	 	If the LESSEE fails to leave the PREMISES in the condition
contemplated in sub-clause 13.1 at the expiration
or prior termination of this AGREEMENT or the eventual vacation thereof, the LESSOR may have the
necessary repairs effected or other work done to restore the PREMISES to the condition contemplated in sub-
clause 13.1, only if the Lessee elects not to do so. The LESSEE shall forthwith on demand pay to the
LESSOR all costs incurred or which may have to be incurred in terms of this sub-clause. A certificate signed
by an authorised representative of the LESSOR stating the amount of the costs aforementioned (or the
anticipated costs to be incurred), shall be prima facie proof of the amount due and payable by the LESSEE to
the LESSOR. This provision shall not in any way prejudice the LESSOR’s rights pursuant to sub-clause 13.3
below.
	 
	 	13.3	 	If the LESSOR is prevented from letting the PREMISES due to the fact that repairs are being done to the
PREMISES in terms of sub-clause 13.2, the LESSEE shall, not withstanding termination of this AGREEMENT,
pay to the LESSOR an amount equal to the monthly rental and other monies (e.g. increase in rates and taxes,
sanitation fees, etc.) which the LESSEE would have had to pay to the LESSOR had this AGREEMENT not
been cancelled, multiplied with the period expressed in months during which the LESSOR is prevented from
letting the PREMISES as a result of the work and repairs being done to the PREMISES.
	 
	 	13.4	 	The LESSEE shall not without the LESSOR’s prior written consent being had and obtained, which consent
shall not be unreasonably withheld, bring any safe or other
unusually heavy object onto the PREMISES and
the LESSEE shall be responsible for the repair, to the
satisfaction of the LESSOR, of any damage to the
PREMISES or to the BUILDING, caused by such heavy objects.
	 
	 	13.5	 	The LESSEE shall at all times during the LEASE PERIOD keep
and maintain in proper order and condition all
lamps and fittings for electric light and power.
Air-conditioning and ventilation fitted in the leased PREMISES
will also be maintained by the LESSEE.
	 
	 	13.6	 	For the duration of the Lease the LESSOR shall not be
liable for, whether wholly or in part, the replacement of,
or repairs to, the floor covering in the PREMISES. The LESSEE
shall be liable for the cost of replacement of,
or repairs to the floor covering, power and telephone outlets,
defective fluorescent tubes, electric bulbs, starters
and choking coils, broken or cracked partitions, plate glass, window frames and door panels, ventilation
louvres and any other item supplied by the LESSOR in or on the PREMISES.
	 
	 	13.7	 	The LESSEE shall not without the LESSOR’s prior consent being obtained, which consent shall not be
unreasonably withheld, effect any repairs or permit repairs to be effected to the PREMISES and/or replace any
equipment for which he is liable in terms of this clause. The LESSOR shall decide whether the LESSOR or
the LESSEE or another party shall effect the repairs or replacement and shall determine the conditions which
shall apply to the repair work and/or replacement. The repair work and/or replacement shall be executed to
the satisfaction of the LESSOR at the reasonable expense of the LESSEE.
	 
	 	13.8	 	The LESSEE shall not change the colour scheme of the PREMISES without the prior written consent of the LESSOR being had and obtained.

	14.	 	ALTERATIONS

	 	14.1	 	The LESSEE may not effect any alterations and/or
additions to the PREMISES without the prior written consent of the
LESSOR being had and obtained, which consent shall not be
unreasonably withheld. In the
event of alterations and/or additions the LESSEE shall at the
expiration or prior termination of this

 

 

	 	 	 	 	 
	 	 	
6
	 	ANNEXURE A

	 	 	 	AGREEMENT, repair and/or remove such alterations and/or additions
and restore the PREMISES to the condition in which it was prior to
such alterations and/or additions, fair wear and tear excepted.
Should alterations and/or additions agreed to by the LESSOR not be
defined in an annexure to this AGREEMENT which has been signed or
initialed by all the parties to this AGREEMENT, such written
consent shall serve as prima facie proof of the alterations and/or
additions agreed to by the LESSOR.
	 
	 	14.2	 	In effecting alterations, the LESSEE shall ensure that

	 
	 	14.2.1	 	the walls, floors and ceilings of the PREMISES are not damaged in anyway;
	 	 	 	 
	 	14.2.2	 	the electrical wiring installed to light the PREMISES is not used for any other purpose;
	 
	 	14.2.3	 	the electric outlets or electric wiring is used solely for the purpose to supply power to normal
equipment with a maximum loading of one kilowatt per electric
outlet. For any deviation from this
stipulation the LESSEE shall first obtain the written consent
of the LESSOR, which consent shall not
be unreasonably withheld, prior to any deviation from the
aforegoing.

	 	14.3	 	Should consent be given pursuant to sub-clause 14.2.3 the
alterations or use shall nevertheless be effected
strictly in accordance with the reasonable requirements and conditions imposed or which may be imposed by
the LESSOR and in accordance with all the rules and regulations made from time to time by the suppliers of
electricity, by insurance companies and by the municipality or any other competent authority.
	 
	 	14.4	 	The LESSEE shall be liable for any damage to electrical installations or the BUILDING caused by the
LESSEE’s use, with or without the prior consent of the LESSOR, of the electric outlets or wiring.
	 
	 	14.5	 	If the LESSEE on expiration or prior termination of the AGREEMENT or when he eventually vacates the
PREMISES, fails to remove and/or repair, to the reasonable satisfaction of the LESSOR, the alterations and/or
additions to the PREMISES in terms of sub-clause 14.1, the LESSOR may repair and/or remove the
alterations and/or additions at the LESSEE’s expense. Any additions thus removed shall become the
PROPERTY of the LESSOR without any obligation to compensate the LESSEE therefor. The Lessee shall
have the right to remove any corporate image items and the LESSEE’S corporate signage will remain its
property.
	 
	 	14.6	 	The LESSEE shall forthwith on demand pay to the LESSOR the amount for expenditure to be incurred by the
LESSOR for the removal and/or repairs referred to in sub-clause 14.5. A certificate signed by the LESSOR
and in which the amount of expenses or expected expenses is stated, shall be prima facie proof of the amount
due and payable by the LESSEE. This provision shall not prejudice the LESSOR’s right to claim damages for
loss of rental from the LESSEE if the PREMISES on vacation cannot be let because the alterations and/or
repairs have not yet been effected to the satisfaction of the LESSOR.
	 
	 	14.7	 	The LESSEE may under no circumstances without the prior written consent of the LESSOR being had and
obtained, which consent shall not be unreasonably withheld, install
or arrange to be installed any heaters or air-
conditioning units.

	15.	 	SIGNS, NAME PLATES, ETC
	 
	 	 	The LESSEE shall not place any name-plate, advertisement or anything of
a like nature on any part of the BUILDING, including display windows,
either internal or external, or on the PROPERTY save with the prior
written consent of the LESSOR being had and obtained, which consent
shall not be unreasonably withheld. The LESSOR shall in such way as the
LESSOR may decide is suitable and at the expense of tenants (allocated
on a pro rata share to each tenant’s sign), provide name-boards at or
near the entrances on the ground floor and on each floor and on which
the names of the tenants and their professions are stated.
	 
	 	 	The LESSEE shall be entitled to have a name-plate or other form of
identification fixed to the main entrance to the PREMISES provided that
the LESSOR has approved such name-plate or other form of identification.
The LESSOR shall affix such name-plate or other form of identification
at the expense of the LESSEE. Any name-plate affixed at the expense of
the LESSEE, shall become and remain the property and the responsibility
of the LESSEE.
	 
	 	 	The LESSEE shall not be entitled to hang any curtains or place or erect
any blinds of whatever nature in the PREMISES
and/or any other part of the BUILDING without the prior approval of the
LESSOR being had and obtained, which approval
shall not be unreasonably withheld.
	 
	 	 	Should the LESSEE place or affix any of the abovementioned in or on the
PREMISES or the BUILDING without the prior
written consent of the LESSOR being had and obtained, the LESSOR has the
right, without prejudice to any other rights of the LESSOR in terms of
this AGREEMENT, to remove same at the expense of the LESSEE.

 

 

	 	 	 	 	 	 	 
	 	 	 	
7	 	 	ANNEXURE A

	16.	 	INTERRUPTION OF SERVICES
	 
	 	 	The LESSOR shall take all reasonable steps to ensure the supply of
water, electricity and, if applicable, air-conditioning to the
PREMISES, but the LESSOR shall not be liable for any delay,
inconvenience or damage, whether direct or consequential, suffered by
the LESSEE as a result of an interruption in the supply of these
services. The LESSEE shall forthwith notify the LESSOR of any defect
in the water system, electrical or air-conditioning installations and
the LESSOR shall take all reasonable steps within acceptable limits to
ensure that the defect is rectified as soon as possible.
	 
	 	 	The LESSEE may not reduce the rental, withhold or defer payment of
rental, or terminate this AGREEMENT by reason of such interruption.
	 
	17.	 	PROVISION OF SERVICES
	 
	 	 	The LESSOR may at any time during the LEASE PERIOD lay electric
wiring, air-conditioning equipment, water pipes, telephone cables or
any other equipment or wiring through the PREMISES should it be
necessary for the supply of electricity, air-conditioning, water or
any other service to any other part of the BUILDING and/or the
PROPERTY. However, the LESSOR shall endeavor to ensure that as little
inconvenience as possible is caused to the LESSEE. The LESSEE may not
reduce the rental, withhold or defer payment of rental, or terminate
this AGREEMENT as a result of any such inconvenience or disruption of
his business activities.
	 
	18.	 	COMMUNAL CONVENIENCES AND SERVICES

	 	18.1	 	The LESSEE may together with the other lessees in the
BUILDING and/or on the PROPERTY use the toilets,
escalators, lifts, loading zones, kitchens, malls and passages, service corridors, staircases and other
conveniences allocated by the LESSOR for communal use.
	 
	 	18.2	 	The LESSEE shall comply with any rules laid down from time to time by the LESSOR for the use of the
conveniences and shall take all reasonable steps to prevent a contravention of such rules. Should there be an
interruption in any of the communal services or facilities or should any such services and conveniences or
equipment become unusable, the LESSEE may not reduce the rental, withhold or defer payment of rental, or
terminate this AGREEMENT, provided that the Lessor shall make every reasonable effort to remedy the cause
of the interruption as soon as possible.
	 
	 	18.3	 	Common areas such as, inter alia, the backyard, loading zones and passages, shall not be used by the
LESSEE for storage, display or sale of goods, supplying of services, the parking of vehicles or for any other
purpose not permitted by the LESSOR and the LESSEE shall take all reasonable steps to ensure that the
common areas are not misused in any way.
	 
	 	18.4	 	No goods, crates, furniture, safes or any other such items may be taken onto the escalators or into the
passenger lifts on the PROPERTY without the prior consent of the LESSOR being had and obtained, which
consent shall not be unreasonably withheld. No vehicles of whatever nature may be brought through any of
the entrances to the PROPERTY except through entrances for vehicles.
	 
	 	18.5	 	The LESSEE shall use its reasonable endeavors to ensure that the common areas and communal facilities
are not used as eating-and/or general resting places and shall
ensure that no one misuses the areas and
facilities in any other way.
	 
	 	18.6	 	Communal conveniences and facilities are used at the
LESSEE’s own risk and the LESSOR shall not be liable
for any injury, damage or loss, however caused, which the LESSEE
may suffer as the result of his use
aforesaid. The LESSOR should not be entitled to contract out of
its own negligence.

	19.	 	PARKING FACILITIES, DRIVEWAYS AND LOADING ZONES

	 	19.1	 	The basement parking, parking areas and/or parcade of the
PROPERTY, if provided, are under direct control
of the LESSOR. The LESSEE may park a vehicle only at the place and
on the conditions, which the LESSOR
may stipulate from time to time. The LESSOR may appoint a person
to ensure that the provisions of this
clause are adhered to. The LESSOR shall from time to time
determine the times when the basement parking,
parking areas and/or parcade will be available for parking, the
rental or parking tariff, and the arrangements for
entry to the basement parking, parking areas and/or parcade. Any
stipulations imposed by an authorised
representative of the LESSOR shall be as agreed with the LESSOR and
the LESSEE shall be bound by the
stipulations.
	 
	 	19.2	 	The LESSEE shall not place, or permit to be
placed, any sign, object or any obstruction whatsoever in or on
the driveways, loading zones, basement parking, parking area and/or
parcade which may in any way impede

 

 

	 	 	 	 	 	 	 
	 	 	 	
8	 	 	ANNEXURE A

	 	 	 	free access or exit to the driveways, loading zones, basement
parking, parking areas and/or parcade. The loading zones shall
be used solely for the loading or unloading of goods. Vehicles
may not be parked on a loading zone unless goods are being
loaded or unloaded.
	 
	 	19.3	 	The LESSEE shall take all reasonable steps to prevent his
employees from obstructing the entrances and/or
exits to the basement parking, parking areas, parcade, escalators, lifts, loading zones, driveways, passages
and/or arcades in any way whatsoever.
	 
	 	19.4	 	The LESSOR shall, wherever possible, incorporate similar clauses in other leases concluded by the LESSOR
in respect of the PROPERTY but the LESSOR shall under no circumstances be liable to the LESSEE if the
provisions of such clauses are not complied with by any other lessee.
	 
	 	19.5	 	Should the basement parking, parking areas, parcade, driveways, loading zones and/or the parking bay of the
LESSEE and/or entrances and/or exits hereto or therefrom (hereinafter called “parking space”) for any reason
be completely destroyed or become unsuitable for their intended use temporarily or for the duration of the
LEASE PERIOD, no claim for compensation or damages shall be brought against the LESSOR and the
LESSEE shall not be entitled to claim a reduction in rent or the termination of this AGREEMENT or to withhold
or defer payment of rental. The LESSOR shall, as soon as possible, repair or make suitable the parking
space and the LESSEE if he is a lessee of a parking space, shall be entitled to a reduction in the rental
payable for his parking space during the period that the parking space is being repaired unless the LESSOR
can provide the LESSEE with alternative parking space of the same or similar standard. The LESSOR and
the LESSEE shall mutually agree to the reduction or the alternative parking space.
	 
	 	19.6	 	The LESSEE shall park every vehicle on/in the parking space at his own risk and the LESSOR shall not be
liable for any loss or damage whatsoever (whether due to the LESSOR’s negligence or not) to a vehicle, its
accessories or contents, while it is parked on the PROPERTY. The LESSOR shall furthermore not be liable
for any personal accident or third party claims which may arise from the use by the LESSEE of the basement
parking, parking areas and/or parcades in/on the PROPERTY. The Lessor should not be entitled to contract
out of its own negligence.
	 
	 	19.7	 	Notwithstanding any rights which the LESSEE may have in respect of a parking space, the LESSOR may let
the basement parking, parking areas and/or parcade to a third
party during the LEASE PERIOD in which event
the LESSOR shall for the purposes of the LESSEE’s rights be
substituted by such third party as LESSOR and
the LESSEE shall pay all amounts which he is liable to pay in
respect of such rights to the third party.

	20.	 	INSPECTION, BUILDING OPERATIONS AND REPAIRS

	 	20.1	 	The LESSOR may on notice to the Lessee enter, inspect and have repairs effected to the PREMISES at all
reasonable times.
	 
	 	20.2	 	In the event of the BUILDING not being fully completed on the date on which the LESSEE is to take
occupation of the PREMISES or in the event of repairs and/or
alterations thereto or to the PREMISES being
undertaken at a later stage and the LESSEE being inconvenienced
by building operations and resulting noise,
the LESSEE shall be entitled to claim a remission of, or a
reduction in rental and/or any damages. The
LESSEE shall not be entitled to cancel this AGREEMENT as a
result of the BUILDING operations.
	 
	 	 	 	Any dispute between the parties as to the remission or
reduction of rental shall be dealt with in accordance with the
provisions of clause 25.3.
	 
	 	20.3	 	In exercising its rights in terms hereof, the LESSOR shall
take steps to ensure that as little inconvenience as is
possible is caused to the LESSEE.

	21.	 	KEYS AND LOCKS
	 
	 	 	No duplicate keys of any lock on the PREMISES, or any other premises
on the PROPERTY shall be made nor shall any additional lock be fixed
to any door of the PREMISES or the BUILDING without the prior written
consent of the LESSOR being had and obtained. On vacating the
PREMISES the LESSEE shall deliver all keys and duplicate keys in good
order to the LESSOR. The LESSEE shall be liable for any loss of, or
damage to, the keys and locks of the PREMISES and shall, at the
request of the LESSOR, either replace the keys and locks or have the
lock mechanisms and lock combinations changed and provide new keys.
	 
	22.	 	CLEANING SERVICES AND REFUSE REMOVAL

	 	22.1	 	The LESSOR shall provide a cleaning service in the
communal areas of the PROPERTY. The LESSOR shall
decide on the nature and quality and the times and frequency of the
cleaning service and the LESSEE shall

 

 

	 	 	 	 	 
	 	 	
9
	 	ANNEXURE A

	 	 	 	not interfere with the service or hinder the LESSOR’s workmen
in the performance of their duties, provided that the LESSOR
shall exercise its rights in terms hereof with the least
possible inconvenience to the LESSEE.
	 
	 	22.2	 	Should the PREMISES be office premises, the LESSOR shall in
its own discretion decide on the provision,
nature, quality, extent and frequency of cleaning services.
	 
	 	 	 	Should the parties agree that the LESSEE shall be responsible
for the cleaning service, which shall include the regular
cleaning of all floor surfaces, plate-glass window frames and
sun blinds on the PREMISES, the LESSEE shall not appoint any
firm rendering such service to clean the interior of the
PREMISES without the prior written consent of the LESSOR being
had and obtained to such appointment and the times during which
such cleaning service shall be rendered. Should the LESSOR, in
its own discretion, decide that the firm appointed by the
LESSEE or the staff of such firm or the times of such services
interfere with the LESSOR’s security measures in respect of the
PROPERTY the LESSEE shall upon receipt of written notice from
the LESSOR, forthwith terminate his agreement with such firm.
	 
	 	 	 	The LESSOR shall clean the outside windows of the PREMISES and
the LESSEE hereby agrees, where necessary, to permit the window
cleaners entry to the PREMISES. The LESSEE shall not make his
own arrangements with the cleaners as to the times of this
cleaning service but shall make arrangements with the LESSOR in
this regard. The LESSOR’s decision in this regard shall be
final.
	 
	 	22.3	 	Should the PREMISES be described as a shop in the AGREEMENT,
the LESSEE shall at his own expense
clean the inside of the PREMISES, as well as the name-boards on the outside of the PREMISES. The
LESSEE shall, in accordance with the LESSOR’s directives, regularly clean all plate glass, louvers (whether of
glass or otherwise) and window frames on the inside and the outside of the PREMISES.
	 
	 	22.4	 	The LESSEE shall contribute to the cleaning service provided as per paragraph 22.1 on the PROPERTY on a
pro rata floor area basis and shall follow all reasonable directives of the LESSOR with regard to the cleaning
thereof.
	 
	 	22.5	 	The LESSEE shall be responsible for the removal of refuse from the PROPERTY in accordance with
arrangements with the relevant municipality. The LESSEE shall
keep his refuse on the PREMISES and shall
not leave any refuse outside the PREMISES except if agreed
otherwise in writing by the LESSOR and the
LESSEE. The LESSOR shall decide on the times and frequency of
refuse removal from the PREMISES, or
from such central point on the PROPERTY as may be designated by
the LESSOR for the placing of refuse.
Should in the LESSOR’s opinion the LESSEE’s quantity and type of
refuse be abnormal, the LESSEE shall
make special arrangements with the LESSOR for its removal.
The LESSEE shall pay all costs of refuse
removal.

	23.	 	NUISANCE
	 
	 	 	The LESSEE shall not do or permit or cause anything to be done which
in the reasonable opinion of the LESSOR constitutes a nuisance or may
cause inconvenience to or in any way disturb the peace and quiet of
the LESSOR and/or other lessees on the PROPERTY or in the BUILDING or
which in general detracts from the neat appearance of the PROPERTY or
the PREMISES.
	 
	 	 	The LESSEE shall also be obliged at his own expense to comply with the
requirements of all regulations, laws, provincial ordinances and
municipal rules and regulations concerning the conduct of the LESSEE’s
business. Without detracting from the generality of the foregoing, the
LESSEE may not exhibit, store, or leave goods or articles on the
pavements or the stairs or landings or in passages, foyers or arcades
of the PROPERTY. The LESSEE shall have no right of entry to the roof,
machine rooms of the BUILDING, and/or workrooms of the LESSOR.
	 
	24.	 	BURGLARY OR ATTEMPTED BURGLARY
	 
	 	 	The LESSEE shall be responsible for the repair of any damage to the
interior of the PREMISES as the result of a burglary or an attempted
burglary of the PREMISES.
	 
	25.	 	DISASTER DAMAGE

	 	25.1	 	Unrentable
	 
	 	 	 	If, as the result of fire, storms or any other cause whatsoever, the PREMISES are destroyed completely or are
rendered unfit for the purpose for which it is let, this AGREEMENT shall terminate forthwith and the LESSEE
shall have no claim for compensation or damages against the LESSOR, except for losses suffered as a result
of negligence of the Lessor. The AGREEMENT shall however, not terminate if the PREMISES are destroyed
or rendered unfit due to a willful act or omission of the LESSEE or any other person under his control.

 

 

	 	 	 	 	 
	 	 	
10
	 	ANNEXURE A

	 	25.2	 	Rentable
	 
	 	 	 	Should the PREMISES be partially damaged by fire, storms or any
other cause whatsoever to such an extent that the LESSEE is
still reasonably able to use it for the purpose described in the
AGREEMENT, the LESSOR shall ensure that the PREMISES are
repaired as soon as possible and the LESSEE shall be entitled to
a reduction in rental whilst the PREMISES are being repaired.
The amount of the reduction shall be mutually agreed upon. The
LESSEE shall however, not be entitled to any reduction in rental
if the PREMISES are partially damaged due to a fault of the
LESSEE or any other person under his control.
	 
	 	25.3	 	In the event of a dispute between the parties:

	 	25.3.1	 	as to whether the PREMISES are at any time wholly untenantable or not;
	 
	 	25.3.2	 	the amount of the reduction in rental contemplated by clause 25.2
	 

	 	 	 	it is agreed that an Arbitrator shall be appointed to decide the
dispute. Such Arbitrator shall appoint an expert, if necessary,
to determine any dispute between the parties in regard to the
amount of the reduced rental.
	 
	 	 	 	If the parties cannot agree on an Arbitrator then the then
Chairman of the Western Cape Branch of the South African
Institute of Architects shall be asked to appoint an expert to
act as Arbitrator. His decision shall be accepted as final and
binding on both parties. The costs of such Arbitration shall be
shared between the parties.

	26.	 	NON-LIABILITY
	 
	 	 	The Lessor shall not be liable for any damage or loss which the LESSEE
may suffer on the PREMISES or in or on the PROPERTY, except if it is as a
result of negligence of the Lessor.
	 
	27.	 	INSURANCE

	 	27.1	 	The LESSEE shall ensure that

	 	27.1.1	 	the insurance policy/ies in respect of the PROPERTY and/or the BUILDING and/or any part or the
contents thereof is/are not invalidated or prejudiced by inflammable, combustible or other dangerous
materials, the presence of which is contrary to regulations of the local and other authorities and the
insurers, being brought onto the PROPERTY;
	 
	 	27.1.2	 	no work is done or any trade conducted in the PREMISES which may in any way prejudice the
insurance policy/ies referred to in 27.1.1

	 	27.2	 	If the insurance premiums are increased as the result of a trade conducted by the LESSEE on the PREMISES
or as the result of inflammable or other dangerous goods or materials being brought onto the PREMISES, with
or without the LESSOR’s consent, the LESSOR may recover the increase in premiums from the LESSEE.
	 
	 	27.3	 	The LESSOR shall comprehensively insure the BUILDING (of which the PREMISES form part) for the joint
benefit of the LESSOR and LESSEE i.e. the LESSEE’s interest shall
be noted on the policy. Without limiting
the generality of the aforegoing:

	 	27.3.1	 	The LESSEE shall be responsible for repair of any
damage to the interior of the PREMISES as the result of a
burglary or an attempted burglary of the PREMISES.

	 	27.4	 	The LESSEE shall insure the contents of the PREMISES.

	28.	 	SUBLETTING AND ALIENATION

	 	28.1	 	The LESSEE shall not cede, transfer, pledge or in any way
dispose of any of his rights in terms of this
AGREEMENT and may not sublet the PREMISES or any part thereof nor
allow anyone else to occupy the
PREMISES or any part thereof, whether for a specific or limited
period of time, without the prior written consent
of the LESSOR, which consent shall not be unreasonably withheld.
	 
	 	28.2	 	The LESSOR shall release the LESSEE from his future
obligations in terms of this AGREEMENT provided the
LESSEE applies thereto in writing and introduces another lessee to
the LESSOR who is acceptable to the

 

 

	 	 	 	 	 
	 	 	
11
	 	ANNEXURE A

	 	 	 	LESSOR and who enters into a new lease with the LESSOR for at
least the unexpired period of this AGREEMENT at the rental and
on the terms and conditions which the LESSOR may then require.

	29.	 	TRANSFER OF SHARES,
MEMBER’S INTEREST AND CHANGE OF PARTNERSHIP

	 	29.2	 	If the LESSEE is a partnership, its composition shall not be
altered for the duration of the LEASE PERIOD
save with the LESSOR’s prior written consent being had and obtained. If such an alteration takes place
without the prior written consent of the LESSOR, the present partners shall remain jointly and severally liable in
terms of this AGREEMENT as if the partnership had not been dissolved.
	 
	 	29.3	 	If some but not all the partners of the partnership, sign this AGREEMENT it shall be deemed that the partners
who have signed have by their signatures warranted to the LESSOR
that they are authorised to bind the other
partners to all the conditions of this AGREEMENT, including the
provisions of this sub-clause.

	30.	 	LIABILITY
	 
	 	 	If two or more persons are the LESSEE they shall be liable jointly
and severally for the due fulfillment of all the LESSEE’s obligations
in terms of the AGREEMENT.
	 
	31.	 	COSTS
	 
	 	 	The LESSEE shall against signature of this AGREEMENT pay all costs in
connection with the drafting of the AGREEMENT to the LESSOR.
	 
	 	 	The stamp duty payable on the AGREEMENT and any addenda shall be
payable by the LESSEE to the LESSOR on demand.
	 
	32.	 	“TO LET” NOTICES
	 
	 	 	The LESSOR shall be entitled in the 3 (three) months prior to
expiration or termination of this AGREEMENT to place “To Let” notices
in a prominent position on the PREMISES and to show the interior of
the PREMISES to potential lessees at any reasonable time. During this
period the LESSOR or any new lessee of the PREMISES may exhibit on the
windows and/or doors of the PREMISES any notices required for any
application relating to the PREMISES or any trade license for the
PREMISES. The LESSEE shall also permit the interior of the PREMISES to
be shown at any reasonable time to prospective purchasers of the
PROPERTY.
	 
	33.	 	FIRE FIGHTING AND EVACUATION EXERCISES
	 
	 	 	The LESSEE shall take part and co-operate with the LESSOR in all
security activities, fire fighting, fire prevention and evacuation
exercises which the LESSOR may order from time to time.
	 
	34.	 	ENTRY TO THE PROPERTY
	 
	 	 	For security purposes the LESSOR shall supply access control to all
the entrances to the PROPERTY and shall supply control for those
entrances which in the LESSOR’s opinion are necessary to admit or to
let out the LESSEE.
	 
	35.	 	RULES
	 
	 	 	The LESSOR may from time to time prescribe rules to facilitate the
administration of the BUILDING. These rules may
include, inter alia, the delivery of goods, refuse removal,
advertisements, the use of communal conveniences and parking
space, delivery of mail, fire prevention exercises and security measures.
The LESSEE shall be bound by the rules. The
LESSOR shall notify the LESSEE of the rules and any amendments thereto
thereafter.

 

 

	 	 	 	 	 
	 	 	
12
	 	ANNEXURE A

	36.	 	NON-WAIVER AND WHOLE
AGREEMENT
	 
	 	 	Non-waiver

	 	36.1	 	Neither party shall be regarded as having waived, or be precluded in any way from exercising any right under
or arising from this AGREEMENT by reason of such party having at any time granted any extension of time for,
or having shown any indulgence to the other party with reference to, any payment or performance hereunder,
or having failed to enforce, or delayed in the enforcement of, any right of action against the other party.
	 
	 	36.2	 	The failure of either party to comply with non-material provision of this AGREEMENT shall not excuse the other
party from performing the latter’s obligations hereunder fully and timeously.

	 	 	Whole agreement

	 	36.3	 	This is the entire agreement between the parties.
	 
	 	36.4	 	Neither party relies in entering into this AGREEMENT upon any warranties, representations, disclosures or
expressions of opinion which have not been incorporated into this AGREEMENT as warranties or
undertakings.
	 
	 	36.5	 	No variation or consensual cancellation of this AGREEMENT shall be of any force or effect unless reduced to
writing and signed by both parties.

	37.	 	LEGAL COSTS
	 
	 	 	Should the LESSOR institute legal action against the LESSEE for payment
of moneys payable in terms of this AGREEMENT, with or without
cancellation of the AGREEMENT, the LESSEE shall also be liable to the
LESSOR for all legal costs as between attorney and client, including
collection commission, as between attorney and client, and any costs
incurred to trace the LESSEE.
	 
	38.	 	DOMICILE AND JURISDICTION OF COURT

	 	38.1	 	The LESSEE hereby chooses 103 Algoa Road, Uitenhage, 6230 as
his domicilium citandi et executandi for
all matters arising from this AGREEMENT, including but not limited to the receipt of all notices and legal
documents.
	 
	 	38.2	 	The LESSOR’s chosen domicilium citandi et executandi shall be as stipulated in the AGREEMENT.
	 
	 	38.3	 	All notices which the LESSOR may give to the LESSEE in terms of this AGREEMENT shall be sent by
prepaid registered mail or delivered by hand or placed in the LESSEE’s post-box. In the case of notices
sent by prepaid registered mail, it shall be deemed to have been received by the LESSEE on the 4th
(fourth) business day after the date of posting, unless the contrary is proven. Notices delivered by hand
and for which no dated acknowledgement of receipt is obtained or notices placed in the LESSEE’s post-box shall be deemed to have been received on date of delivery unless the LESSEE can prove the contrary.
	 
	 	38.4	 	Should the LESSEE fail and/or refuse to take occupation of the PREMISES or vacate the PREMISES, with or
without the LESSOR’s consent, the LESSOR may, notwithstanding anything to the contrary contained in this
AGREEMENT, send or deliver by hand any notice to be given to the LESSEE in terms of this AGREEMENT to
the LESSEE at his last known business or residential address, or in the case of partnerships, at any known
address of any of the partners, or in the case of a company, at any known address of any of the directors or
shareholders. Any notice sent by registered mail or delivered by hand shall be deemed a proper dispatch or
delivery of such notice pursuant to the provisions of clauses 38.1 to 38.4.

	 	 	Jurisdiction of Court

	 	38.5	 	Notwithstanding the provisions of the Magistrate’s Courts Act (Act 32 of 1944) (as amended from time to time
or substituted) with regard to jurisdiction in connection with cause of action and/or the amount claimed, a
competent Magistrate’s Court shall have jurisdiction in respect of any legal action which the LESSOR may
institute against the LESSEE arising from this AGREEMENT. Either party shall have the right, notwithstanding
the aforegoing, at its own discretion, to institute any legal action which exceeds the jurisdiction of the
Magistrate’s Court, against the other in the competent division of the High Court.

	 	 	Arbitration

	 	38.6	 	In the event of a notice of intention to defend being delivered in any legal action, or a notice of intention to
oppose being delivered in any application instituted by any one of
the parties out of the High Court or the

 

 

	 	 	 	 	 	 	 
	 	 	 	
13	 	 	ANNEXURE A

	 	 	 	Magistrate’s Court in a dispute of any nature whatsoever arising
between the parties on any matter provided for in, or arising out
of this AGREEMENT, then that dispute shall be referred to
arbitration provided that:
	 
	 	38.6.1	 	Where the party instituting such action would normally be
entitled, upon receipt of such a notice of
intention to defend to file an application for summary judgement, the dispute shall only be referred to
arbitration upon:
	 

	 	38.6.1.1 	 	Refusal of the application for summary judgement by the relevant Court; or
	 
	 	38.6.1.2	 	 Withdrawal of the application for summary judgement; or
	 
	 	38.6.1.3	 	 Where no application for summary judgement was filed, upon the expiry of the time
allowed on the relevant Court Rules for the filing of
an application of summary judgement.
	 

	 	38.6.2	 	 Where a dispute is referred to arbitration in terms of the
provisions of Clause 38.6, the parties further
agree that any rent interdict issued by the Magistrate’s
Court (in terms of Section 31 of Act 32 of
1994) or the High Court shall remain in effect until all
outstanding rent awarded to the LESSOR is
paid, or the LESSOR’s claim is dismissed.
	 
	 	38.6.3	 	 The party who instituted the action or application may elect to continue the process in the Court
wherein it was instituted. Such action shall be exercised in a written notice delivered to the other
party or parties prior to the commencement of the arbitration process.
	 
	 	38.6.4	 	 “Dispute” in paragraph 38.6 shall include, but shall not be limited to the following:

	 	38.6.4.1 	 	Any dispute regarding the interpretation or rectification of the AGREEMENT and
Annexures thereto, as well as this clause;
	 
	 	38.6.4.2	 	 Any dispute regarding the termination of the
AGREEMENT and Annexures thereto and the
consequences of any such termination or purported termination;
	 
	 	38.6.4.3 	 	Any dispute regarding the voidness or voidability of the AGREEMENT and Annexures
thereto. It is specifically recorded that this arbitration clause is severable from the
AGREEMENT;
	 
	 	38.6.4.4 	 	A counterclaim on any matter provided for in or arising out of the AGREEMENT and
Annexures thereto.

	 
	 	38.6.5	 	
Any arbitration arising shall be referred to the Arbitration Forum Limited, and shall be conducted in
accordance with the standard terms and conditions, and the
summary procedure rules, then
applicable in that Forum.
	 
	 	38.6.6	 	 Any variation, amendment or cancellation of this arbitration
agreement shall be of no force and effect
unless agreed to in writing by all the parties to this
AGREEMENT.

	39.	 	ALLOCATION OF MONIES RECEIVED
	 
	 	 	It is hereby agreed between the LESSOR and the LESSEE that,
notwithstanding any allocation by the LESSEE, the LESSOR shall be
entitled to allocate any payment made by the LESSEE in terms hereof
firstly in settlement or partial reduction of any rental or other amount
in arrears on date of receipt of such payment and the surplus, if any,
thereafter in settlement or in partial reduction of any rental or other
amount due and payable on date of receipt of such payment to the LESSOR
for the calendar month during which such payment is made.
	 
	40.	 	REBUILDING
	 
	 	 	Should the LESSOR decide to demolish the BUILDING (or any part thereof)
or the PREMISES, the LESSOR may, notwithstanding anything to the
contrary contained in this AGREEMENT, terminate this AGREEMENT by giving
the LESSEE 6 (six) months prior written notice to vacate the PREMISES.
	 
	41.	 	SIGNATURE AND RETURN OF AGREEMENT OF LEASE
	 
	 	 	This document records the AGREEMENT between the LESSOR and the LESSEE but
should this AGREEMENT not be
returned to the LESSOR, duly signed and completed, within 30 (thirty)
days after dispatch to the LESSEE, the LESSOR
may, without prejudice to any other rights which the LESSOR may have,
adjust and amend the rental and terms and
conditions contained herein.

 

 

	 	 	 	 	 
	 	 	
14
	 	ANNEXURE A

	42.	 	DEPOSIT

	 	42.1	 	 As security for the due and proper fulfillment by the LESSEE
of all his obligations in terms of and arising from
this AGREEMENT, the LESSEE shall, against signature hereof by the
LESSEE, pay the amount indicated
under DEPOSIT in the AGREEMENT to the LESSOR which amount the
LESSOR shall hold during the
LEASE PERIOD, on behalf of the LESSEE, including any
extension/renewal thereof, provided that the
LESSOR shall, subject to the provisions of sub-clause 42.2 below,
refund the DEPOSIT, with interest, to the
LESSEE within 3 (three) months from date of expiration of the LEASE
PERIOD (including any renewal/or
extension thereof). Interest payable by the LESSOR will be 60% of
prime rate at FNB. Capitalised annually.
	 
	 	42.2	 	 The LESSOR shall be entitled notwithstanding anything to the
contrary herein contained, to recover any
amount which the LESSEE may be indebted to the LESSOR at expiration of the LEASE PERIOD (including
any renewal/extension thereof), including but not limited to damage to the PREMISES, loss of rental, electricity
costs and other levies in arrears and rental in arrears, in full from the DEPOSIT provided that, should there be
a shortfall, the LESSEE shall remain liable for payment of such shortfall to the LESSOR.
	 
	 	42.3	 	 The LESSEE shall not be entitled at any time during the LEASE PERIOD (including any renewal/extension
thereof) to set the DEPOSIT off against any amount due and payable
by the LESSEE to the LESSOR but
should the LESSEE do so then, notwithstanding anything to the
contrary contained in this AGREEMENT and
in particular Clause 7 hereof, the LESSOR shall be entitled
forthwith to terminate this AGREEMENT without
prejudice to any and/or all the rights of the LESSOR in terms of or
arising from this AGREEMENT and/or the
Common Law.

 

 

ANNEXURE B

OPTION TO RENEW

The LESSEE shall have the option to renew the Lease for the PREMISES for a
further period as referred to in clause 2.2 of the AGREEMENT.

	1.	 	LESSEE’s OPTION
	 
	 	 	The LESSEE shall be entitled to renew this lease for the RENEWAL PERIOD
on the same terms and conditions as contained herein save that the
rental shall be the rental determined pursuant to the provisions of
clause 2 hereafter; and provided that:

	 	1.1	 	 the LESSOR shall not have lawfully cancelled this lease;
	 
	 	1.2	 	 the LESSEE shall have given the LESSOR written notice at
least 8 (eight) months prior to the expiry of the
INITIAL PERIOD of its intention to renew this lease.

	2.	 	DETERMINATION OF RENTAL FOR THE RENEWAL PERIOD

	 	2.1	 	 The monthly rental payable by the LESSEE to the LESSOR shall
during the RENEWAL PERIOD be in respect
of the first year of the RENEWAL PERIOD, the estimated fair market
rental for the PREMISES (having due
regard to the terms of this lease, as at the commencement of that
particular year, with the fair market increase
and/or escalations in rental for each of the ensuing years of the
RENEWAL PERIOD, determined as at the
commencement of the RENEWAL PERIOD.
	 
	 	2.2	 	 In determining the fair market rental and the fair market
increase and/or escalations as contemplated in 2.1,
regard shall be had to the market value of the PREMISES, the net rate of return prevailing and the prevailing
increases and/or escalations thereon and all other relevant factors.
	 
	 	2.3	 	 Within 30 (thirty) days of the commencement of the sixth month preceding the expiry of the INITIAL PERIOD,
the parties shall endeavour to agree to the rental payable during the RENEWAL PERIOD together with the
fair market increases and/or agreement as aforesaid within the prescribed period, then the rental and the
rental increases and/or escalations shall be determined as soon as possible by an independent Valuer or
Associated Valuer with not less than 10 years experience who practices in the Northern Suburbs of Cape
Town and who has been registered for at least 10 years with the South African Council of Valuers and shall
also be a sworn appraiser nominated by the chairman or president for the time being of the South African
Council of Valuers failing agreement by the parties on a specific valuer.
	 
	 	2.4	 	 Notwithstanding anything to the contrary herein contained or implied, the Valuer shall not be entitled to
determine:-

	 	2.4.1 	 	the monthly rental for the first year of the
RENEWAL PERIOD at less than the monthly rental which
was payable during the last month of the INITIAL PERIOD increased by 12%.
	 
	 	2.4.2 	 	the annual escalations for the RENEWAL PERIOD at less than the escalation provided for in the
INITIAL PERIOD.
	 

	 	2.5	 	
 The determination of the Valuer shall be final and binding on the parties and such determination shall not be
subject to appeal and/or review.
	 
	 	2.6	 	 The costs of the Valuer shall be borne in such manner as may be determined by the Valuer.
	 
	 	2.7	 	 If at commencement of the RENEWAL PERIOD the rental so
payable has not been determined, then pending
such determination the LESSEE shall pay on account of such rental, an amount equal to the minimum
monthly rental payable under 2.4.1.
	 
	 	2.8	 	 Upon the determination of the actual rental so payable for the first year of the RENEWAL PERIOD, any amount
unpaid shall forthwith be paid by the LESSEE to the LESSOR,
together with interest thereon calculated at the Prime Rate on
each such underpayment, from the date when the relevant
underpayment was made to the date of payment.

 

 

ANNEXURE C

COMMENCEMENT DATE OF LEASE PERIOD

FINAL EXTENT

Should the final extent of the PREMISES, in the case of a building to be
erected, calculated from the final plans of the architects, differ from any
extent which may be stated in the AGREEMENT:

	1.	 	  the extent stated in the AGREEMENT as well as the percentage of “lessee’s
contribution to increase” shall be amended
accordingly;
	 
	2.	 	the basic rental will be increased/reduced proportionally;
	 
	3.	 	the additional costs (per month) stated in the AGREEMENT shall, if
applicable, be increased/reduced proportionally.

 

 

ANNEXURE D

AIR-CONDITIONING

	1.	 	The LESSOR will supply the LESSEE with an acceptable standard of
air-conditioning for the shops and offices
supplied. Maintenance of the air-conditioning are as stipulated in
paragraph 13.5 of Annexure A.
	 
	2.	 	The LESSEE acknowledges that after occupation of the PREMISES, the LESSOR
shall be accorded a reasonable
period for the testing and setting of the air-conditioning and that the
air-conditioning may not be of an optimum standard
during this period. The LESSOR shall, however, do everything in his
power to ensure that the period aforesaid is
limited to a minimum.
	 
	3.	 	The LESSEE shall at all times co-operate with the LESSOR to ensure the
most effective use of the air-conditioning.
The LESSEE shall give such co-operation by, inter alia, bringing down or
closing louvers or curtains, whether provided
by the LESSOR or the LESSEE, when the sun’s rays fall directly on the
windows of the PREMISES.
	 
	4.	 	The LESSEE may under no circumstances install or have installed
air-conditioning units in/on the PREMISES without
the prior written consent of the LESSOR being had and obtained.

 

 

TENANTS’ ASSOCIATION

The LESSEE hereby undertakes to become a member of the tenant’s Association of
this development as and when the Association is formed and formally
constituted, which Association will be established for the advancement of all
business activities on the Property.

The LESSEE also undertakes:

	1.	 	to give his full co-operation to the ASSOCIATION to further its objectives;
and
	 
	2.	 	to participate in advertising as required by the ASSOCIATION.

The LESSEE further undertakes to remain a member of the ASSOCIATION
during the LEASE PERIOD or any extension thereof, whether due to the exercise of a right to rent or otherwise. The
LESSEE undertakes to pay his membership fee monthly in advance to the ASSOCIATION or its nominee in accordance with
the provisions of the articles of the ASSOCIATION.

 

 

FLOOR PLAN OF PREMISES

 

 

ADDENDUM TO

MEMORANDUM OF AGREEMENT

OF LEASE

between

iLEASE ASSET MANAGEMENT

 (PTY) LIMITED

 (“LESSOR”)

and

QUINTILES CLINDEPHARM

(PTY) LIMITED

(“LESSEE”)

 

 

 

 

- 2 -

	5.	 	SPECIAL CONDITIONS

	 	5.1	 	 Additional parking facilities
–  4 Under cover parking bays at
R300.00 per bay per month(VAT excluded) as well as 3 open reserved
parking bays at R150.00 per bay per month (VAT excluded);
	 
	 	5.2	 	 The Lessor shall for his own account contribute the
following
amounts, for the specific items, towards the Lessee’s installation
costs.

	 	•	 	 Pay the actual cost of carpeting
only, to the floors of the leased premises, up to a
maximum amount of R55-00/m2 (VAT inclusive) based on
the leased area.
	 
	 	•	 	 Pay the actual cost of
partitioning, utilizing Donn LC
partitioning only, up to a maximum amount of R150.00m2
(VAT inclusive) based on the leased area.
	 
	 	•	 	Pay the actual cost of venetian blinds for all outside
windows.
	 

	 	5.3	 	 The Lessor shall for his own account and prior to the lease
commencement date modify the premises to align with the attached
plan marked Annexure “G” which includes air-conditioning utilizing
console units, re-locating of existing light fittings and power
points and additional power requirements.

	6.	 	The Lessee shall have the right to renew the annexed Agreement of
Lease in conjunction with this Addendum for a further period of five (5)
years, on the same terms and conditions, save as to rental, provided that
written notice of intention to exercise this right of renewal is given to
the Lessor at least six (6) months prior to the expiry of the lease period.
The rental for the renewal period shall be as mutually agreed between the
Lessor and the Lessee.

This Addendum does not waive, extend or change any of the conditions or
limitations in the said Agreement of Lease, except as stated herein.

THUS/....................

 

 

- 3 -

THUS DONE and SIGNED at BELLVILLE on
the 21ST day of DECEMBER 2000.

AS WITNESSES

	 	 	 	 	 
	1.	 	/s/ [illegible]	 	 
	 	 	 	/s/ LAMBERTUS
JACOBUS VAN ZYL	 
	2.	 	 	
LESSOR    	 
	 	 	 	
	 
	 	 	 	
iLEASE ASSET MANAGEMENT	 
	 	 	 	
(PTY) LIMITED	 

THUS DONE and SIGNED at CENTURION on the 19TH day of DECEMBER 2000.

AS WITNESSES

	 	 	 	 	 
	1.	 	/s/ [illegible]	 	 
	 	 	 	/s/ DR. W.S.
CONRADIE	 
	 	 	 	
	 
	2.	
 
	/s/ [illegible]	LESSEE    	 
	 	 	 	QUINTILES CLINDEPHARM	 
	 	 	 	(PTY) LIMITED<PAGE>
                                                                   EXHIBIT 10.22

                                     KB HOME

                        NON-EMPLOYEE DIRECTORS STOCK PLAN

                     (as amended and restated July 10, 2003)

      1. PURPOSE OF THE PLAN. The purpose of KB HOME Non-Employee Directors
Stock Plan ("Plan") is to grant Awards of Stock Units and/or Options to
non-employee Directors of KB HOME (the "Company") in order to align their
compensation with the equity interests of the Company's stockholders. The Plan
provides for compensation through (i) annual grants of Stock Units to Directors
and Committee Chairs, (ii) the payment of Directors' Annual Retainer and Meeting
Fees in cash or Stock Units, and (iii) the ability under certain conditions for
Directors to elect to receive any or all of the foregoing in the form of
Options. The Plan was adopted effective as of September 26, 1996, was
subsequently amended as of December 4, 1998, December 6, 1999, and July 10,
2003.

      2. DEFINITIONS.

      "ANNUAL MEETING" shall mean an annual meeting of stockholders of the
Company.

      "ANNUAL RETAINER" shall mean the retainer fee, established by the Board,
paid to a Director for service as a Director on the Board for a Director Year.

      "ANNUAL STOCK UNIT AWARD" shall mean the annual Award of Stock Units,
established by the Board, paid to a Director at the beginning of a Director Year
in consideration for such Director's agreement to serve as a Director on the
Board for the Director Year.

      "AWARD" shall mean an award of Stock Units or Options pursuant to the
Plan.

      "BOARD" shall mean the Board of Directors of the Company.

      "CHANGE IN CONTROL" of the Company shall have occurred if either: (1)
individuals who, as of the effective date of this Plan, constitute the Board of
the Company (as of the date hereof, the "Incumbent Board") cease for any reason
to constitute at least a majority of the Directors constituting the Board,
provided that any person becoming a Director subsequent to the effective date of
this Plan whose election, or nomination for election by the Company's
shareholders, was approved by a vote of at least three-quarters (3/4) of the
then Directors who are members of the Incumbent Board (other than an election or
nomination of an individual whose initial assumption of office is (A) in
connection with the acquisition by a third person, including a "group" as such
term is used in Section 13(d)(3) of the

                                       1
<PAGE>
Exchange Act, of beneficial ownership, directly or indirectly, of 20% or more of
the combined voting securities ordinarily having the right to vote for the
election of Directors of the Company (unless such acquisition of beneficial
ownership was approved by a majority of the Board who are members of the
Incumbent Board), or (B) in connection with an actual or threatened election
contest relating to the election of the Directors of the Company, as such terms
are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act)
shall be, for purposes of this Plan, considered as though such person were a
member of the Incumbent Board, or (2) the Board (a majority of which shall
consist of Directors who are members of the Incumbent Board) has determined that
a Change of Ownership, for purposes of this Plan, shall have occurred. If any of
the events enumerated in clauses (1) or (2) occur, the Board shall determine the
effective date of the Change of Ownership resulting therefrom, for purposes of
the Plan.

      "CODE" shall mean the Internal Revenue Code of 1986, as amended.

      "COMMITTEE" shall mean the Nominating and Corporate Governance Committee
of the Board or such other committee as may be designated by the Board.

      "COMMITTEE CHAIR RETAINER" shall mean the annual Award of Stock Units,
established by the Board, to be paid to a Director for service as Chairman of a
committee of the Board of Directors for a Director Year.

      "COMPANY" shall mean KB HOME.

      "DIRECTOR" shall mean a non-employee director of the Company.

      "DIRECTOR YEAR" shall mean the fiscal year commencing on the date of the
Company's Annual Meeting and ending on the date immediately preceding the next
Annual Meeting.

      "DIVIDEND EQUIVALENT PAYMENTS" shall mean the payment described in Section
7 hereof, to a holder of Stock Units with respect to certain dividend paid on
outstanding shares of Stock.

      "EFFECTIVE DATE" shall mean September 26, 1996.

      "FAIR MARKET VALUE" of the Stock on a particular date shall equal the
final reported closing price for the Stock on the New York Stock Exchange on
that date, or the immediately preceding trading date in the event such date is
not a trading day.

                                       2
<PAGE>
      "OPTION" shall mean a right to purchase a number of shares of Stock at
such exercise price, at such times, and on such other terms and conditions as
are specified herein or pursuant to such other documentation as may evidence the
Award. Options granted under this Plan are not intended to satisfy the
requirements for treatment as Incentive Stock Options as defined under Section
422 of the Internal Revenue Code of 1986, as amended.

      "PER DIEM FEES" shall mean a fee, established by the Board, authorized by
the Chief Executive Officer of the Company, in his or her sole discretion, to a
Director who is asked to work on Board issues for a significant part of the day
outside of normal Board or committee meetings.

      "RATIO" shall mean such ratio of the grant-date value of an Option to the
Fair Market Value of the Stock underlying the Option as may be determined by the
Committee from time to time for the purposes to calculating the number of
Options to be granted to a Director, provided that any adjustment in such ratio
shall be subject to the approval of the Board.

      "RULE 16B-3" shall mean Rule 16b-3 promulgated under the Securities
Exchange Act of 1934, as amended.

      "STOCK" shall mean shares of Common Stock, par value $1.00 per share, of
the Company.

      "STOCK UNIT" shall mean a right to (i) receive a share of Stock or (ii)
receive a cash payment, in accordance with the conditions set forth herein, of
the Fair Market Value of a share of Stock.

      "TERMINATION DATE" shall mean the date a Director's service on the Board
terminates for any reason.

      3. SOURCE OF SHARES DELIVERED UNDER AWARDS. Any Stock delivered pursuant
to an Award shall consist of shares of stock acquired by the Company on the open
market.

      4. ANNUAL RETAINER AND STOCK UNIT AWARDS.

            (a) The Committee shall from time to time establish the dollar
amount of the Annual Retainer for a Director Year, the number of shares of Stock
subject to the Annual Stock Unit Award and Committee Chair Retainers for a
Director Year, and the applicable Ratio for Options granted during a Director
Year, provided that any adjustment in such amounts or numbers shall be subject
to the approval of the Board.

                                       3
<PAGE>
            (b) On the date of each Annual Meeting, each incumbent Director or
who has been elected as of the date of such Annual Meeting shall receive an
Annual Stock Unit Award of 2,000 Stock Units, which amount shall be subject to
adjustment in future Director Years as contemplated in Section 4(a) hereof. If
an individual is first elected as Director during a Director Year, he or she
shall receive a prorated Annual Stock Unit Award for the remaining balance of
the Director Year.

            (c) On the date of each Annual Meeting, the then-incumbent Chairman
of the Audit and Compliance Committee shall receive a Committee Chair Retainer
of 500 Stock Units; Chairmen of other Committees of the Board shall receive a
retainer of 300 Stock Units. Committee Chair Retainers shall be subject to
adjustment in future Director Years as contemplated in Section 4(a) hereof. If a
Director is elected as the Chairman of a Committee during a Director Year, he or
she shall receive a prorated Committee Chair Retainer for the remaining balance
of the Director Year.

      5. ANNUAL RETAINER. Each Director shall be entitled to receive an Annual
Retainer with respect to each Director Year in accordance with the provisions of
this Section 5. Each Director shall be given an opportunity by the Company on an
annual basis to elect ("Annual Election") to defer or to receive his or her
Annual Retainer: (i) in cash, (ii) in Stock Units, or in Options.

            (a) The Annual Election must be in writing and shall be delivered to
the Secretary of the Company no later than the tenth day preceding the date of
the Annual Meeting. (The Annual Election shall be irrevocable after the tenth
day preceding the date of the Annual Meeting.) The Annual Election shall specify
the Annual Retainer that such Director elects to receive in cash, or Stock
Units, or Options.

            (b) If a Director elects to receive his or her Annual Retainer in
cash, payment shall be made on a quarterly basis. If a Director elects to
receive Stock Units in lieu of the Annual Retainer, the Director shall receive
Stock Units (including fractional Stock Units) with respect to Stock having a
Fair Market Value (on the date of the Company's Annual Meeting) equal to 120% of
the Annual Retainer.

            (c) Any person who becomes a Director following an Annual Meeting,
whether by appointment or election as a Director (or by change in status from a
full-time employee), shall receive an Annual Retainer prorated for the balance
of that Director Year. In the event a Director voluntarily resigns from the
Board during a Director Year, (i) the Director shall return to the Company any
cash payment covering the prorated portion of the Annual Retainer for the
balance of that Director Year and (ii) the Director shall forfeit a percentage
of any

                                       4
<PAGE>
Stock Units or Options awarded (or if an Option has been exercised, the Director
shall return to the Company a cash amount equal to the taxable amount realized
by the Director on the date of the Option exercise) prorated for the balance of
the portion of the Director Year (if any) as to which such Stock Units or
Options were awarded. No return of any portion of the Annual Retainer, Stock
Unit or Option grant shall be required in the event a Director leaves the Board
as the result of retirement, incapacity or death.

6. OPTION AWARDS IN LIEU OF FEES OR STOCK UNITS.

            (a) Any Director may elect to receive an Award of Options in lieu of
the Annual Retainer, Committee Chair Retainer, and/or Annual Stock Unit Award
that such Director otherwise would be entitled to receive. Options shall be
granted as of the date of the Company's Annual Meeting at the commencement of
the Director Year for which the Award is being made.

            (b) The number of shares of Stock subject to an Option granted in
lieu of the Annual Retainer shall equal the number of shares, rounded up to the
nearest whole number, obtained by dividing (i) the dollar amount of the Annual
Retainer by (ii) the product of the Ratio and the Fair Market Value of a share
of Stock on the date of the Award. The number of shares of Stock subject to an
Option granted in lieu of the Annual Stock Unit Award and/or the Committee Chair
Retainer shall equal the number of shares, rounded up to the nearest whole
number, obtained by dividing (i) the Fair Market Value of the number of shares
of Stock subject to the Annual Stock Unit Award and/or the Committee Chair
Retainer, by (ii) the product of the Ratio and the Fair Market Value of a share
of Stock on the date of the Award.

            (c) The price at which each share of Stock may be purchased upon
exercise of a particular Option shall be the Fair Market Value of the Stock on
the date of the Annual Meeting at which the Option is granted. The exercise
price of any Option previously awarded under the Plan may not be adjusted
downward, whether through amendment, cancellation or replacement grants, or by
any other means.

            (d) Each Option shall be vested on the date of grant, but cannot be
exercised unless and until the earlier of: (i) the Director's acquisition and
continued beneficial ownership of at least 5,000 shares of Stock or Stock Units
or (ii) the Director's Termination Date. Options shall have a maximum term of 15
years from the date of grant. Except as provided in Section 5 (c) herein,
Options shall remain outstanding and fully exercisable for one (1) year from the
Termination Date, except in the event of removal for cause, in which case
Options shall remain outstanding and fully exercisable for 30 days.

                                       5
<PAGE>

            (e) No Stock shall be delivered pursuant to any exercise of an
Option until the Director has made payment in full of the Option price therefor
or provision for such payment satisfactory to the Committee. The exercise price
of an Option may be paid in cash or certified or cashiers' check or by delivery
(either actually or by attestation) of shares of Stock that have been acquired
or held by the Director in such manner as to not result in an accounting charge.

            (f) Unless the documents evidencing the grant of an Option (or an
amendment thereto authorized by the Committee) expressly states that the Option
is transferable, no Option granted under the Plan may be sold, assigned,
conveyed, gifted, pledged, hypothecated or otherwise transferred in any manner,
other than by will or the laws of descent and distribution.

      7. DIVIDEND EQUIVALENT PAYMENTS. Effective as of each dividend payment
date for outstanding shares of Stock, a current cash payment shall be made on
each outstanding Stock Unit to the holder thereof in an amount equal to dividend
paid on an outstanding share of Stock.

      8. TIME OF PAYMENT. Unless otherwise provided herein, all payments in
respect of a Director's Stock Units shall be made as soon as practicable after
the earlier of: (i) the occurrence of a Change in Control and (ii) the
Termination Date.

      9. FORM OF PAYMENT. Payment in respect of Stock Units and/or Options shall
be made in Stock or in cash, in accord with the previous annual elections made
by the Director. The Company shall not issue fractions of a share. Whenever
under the terms of the Plan a fractional share would otherwise be required to be
issued, the Director shall be paid in cash for such fractional share.

      10. STATEMENT OF ACCOUNT. Each Director shall receive an annual statement
showing the number of Stock Units and/or Options that have been awarded to the
Director under the Plan.

      11. CHANGE IN CAPITAL STRUCTURE. In the event of any change in the Stock
by reason of any stock dividend, split, combination of shares, exchange of
shares warrants or rights offering to purchase Stock at a price below its fair
market value, reclassification, recapitalization, merger, consolidation or other
change in capitalization, appropriate adjustment shall be made by the Committee
in the number and kind of shares subject to the Plan and any other relevant
provisions of the Plan, whose determination shall be binding and conclusive on
all persons.

      12. NONTRANSFERABILITY. Stock Units shall not be transferable and may not
be alienated by a Director except by will or the laws of descent and
distribution.

                                       6
<PAGE>
      13. RIGHTS. Except to the extent otherwise set forth herein, Directors
shall not have any of the rights of a stockholder with respect to the Stock
Units.

      14. ADMINISTRATION OF THE PLAN. The Plan shall be administered by the
Committee. The Committee shall have full power, discretion and authority to
interpret and administer the Plan, except that the Committee shall have no power
to (i) determine the eligibility for Awards or the number of Stock Units or
timing or value of Awards to be granted to any Director, or (ii) take any action
specifically delegated to the Board under the plan. With respect to any
determination contemplated in subsection (i) of the preceding sentence, the
Committee shall make recommendations to the Board, but any final determination
with respect to such recommendation shall be subject to the approval of the full
Board.

      16. AMENDMENT OR TERMINATION OF THE PLAN. The Board may, at any time,
amend or terminate the plan; but no amendment or termination shall, without the
written consent of a Director, reduce the Director's rights under previously
granted Awards or with respect to any Fees previously earned. No amendment which
requires stockholder approval in order for the Plan to continue to comply with
Rule 16b-3 shall be effective unless the same shall be approved by the requisite
vote of the stockholders of the Company.

      17. NO RIGHT TO RENOMINATION. Nothing in the plan or in any Award shall
confer upon any Director the right to be nominated for reelection to the Board.

      18. PAYMENTS UPON DEATH. In the event of a Director's death, payments with
respect to any Stock Units shall be made in a single lump sum payment to the
beneficiary designated by the Director, and the right to exercise any Options
shall be accorded to such beneficiary, or in the absence of an executed
beneficiary form, to the person legally entitled thereto, as designated under
his or her will, or to such heirs as determined under the laws of intestacy for
the state of his or her domicile.

      19. GOVERNING LAW. The Plan and all actions taken thereunder shall be
governed by and construed in accordance with the laws of the State of
California.

                                       7

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