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Exhibit 10.29


ASSIGNMENT AND SUBORDINATION OF MASTER LEASE
AND CONSENT OF MASTER TENANT

        THIS ASSIGNMENT AND SUBORDINATION OF MASTER LEASE AND CONSENT OF MASTER TENANT (this " Agreement ") is made as of December 9, 2004, by and among 6267 CARPINTERIA AVENUE, LLC , a Delaware limited liability company (" Owner "), VENOCO, INC. , a Delaware corporation ("Master Tenant"), and GERMAN AMERICAN CAPITAL CORPORATION , a Maryland corporation (together with its successors and assigns, " Lender ").

RECITALS:

        A.    WHEREAS, Owner, by that certain Promissory Note, dated as of the date hereof, and given by Owner in favor of Lender in the principal amount of $10,000,000.00 (together with all extensions, renewals, modifications, substitutions and amendments thereof, the " Note "), is indebted to Lender for a loan advanced pursuant to the Note (the indebtedness evidenced by the Note, together with such interest accrued thereon, shall collectively be referred to as the " Loan ");

        B.    WHEREAS, the Loan is secured by, among other things, that certain Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing (together with all extensions, renewals, modifications, substitutions and amendments thereof, the " Security Instrument "), of even date herewith, which grants Lender a first lien on the improved real property which is commonly known as 6267 Carpinteria Avenue and which is located in the City of Carpinteria, the County of Santa Barbara and the State of California (the " Property ") (the Note, the Security Instrument, this Agreement and any of the other documents evidencing or securing the Loan, together with all extensions, renewals, modifications, substitutions and amendments thereof, are collectively referred to herein as the " Loan Documents ");

        C.    WHEREAS, the Property is encumbered by that certain Building Lease, dated as of November 7, 1996, by and between Bermant Development Company (" BDC "), as master landlord, and Benton Oil and Gas Company (" BOGC "), as master tenant, (a) as assigned pursuant to that certain Assignment of Building Lease and Development and Construction Agreement, dated as of June 19, 1997, from BDC, as assignor, in favor of Carpinteria Bluffs Associates, LLC (" CBA "), as assignee (assigning the master tenant's interest thereunder), (b) as amended by that certain First Amendment to Building Lease, dated as of May     , 2000, by and between BOGC and CBA, (c) as further assigned pursuant to that certain Assignment and Assumption of Lease, dated as of December 28, 2001, from BOGC, as assignor, in favor of Venoco, Inc. (" Master Tenant "), as assignee (assigning the master tenant's interest thereunder), (d) as further assigned pursuant to that certain Assignment and Assumption of Leases, dated as of December 8, 2004, from CBA, as assignor, in favor of Owner, as assignee (assigning, among other things, the master landlord's interest thereunder), and (e) as further amended by that certain Amendment to Lease, dated as of December 8, 2004, between Grantor, as master landlord, and Master Tenant, as master tenant (collectively, and as may be further modified, amended and/or supplemented in accordance with the terms hereof and the other Loan Documents, the " Master Lease "), a true and correct copy of which is attached hereto as Exhibit A ; and

        D.    WHEREAS, Lender requires as a condition to the making of the Loan that Owner, as the borrower under the Loan, assign the Master Lease to Lender and subordinate the Master Lease to the Loan, and that Master Tenant consent to the Loan and agree with Lender and Owner as to certain matters more particularly described herein.


AGREEMENT

        NOW THEREFORE, for good and valuable consideration the parties hereto agree as follows:

        1.     Assignment of Master Lease.     As additional collateral security for the Loan, Owner hereby conditionally transfers, sets over and assigns to Lender all of Owner's right, title and interest in and to the Master Lease, said transfer and assignment to automatically become a present, unconditional assignment, at Lender's option, upon the occurrence of an Event of Default by Owner under the Note, the Security Instrument or any of the other Loan Documents (which has not been waived in writing by Lender).

        2.     Master Tenant's Consent to Assignment.     Master Tenant hereby acknowledges and agrees that (a) Master Tenant hereby consents to the assignment of Owner's interest in the Master Lease by Owner to Lender as additional security for the Loan, and (b) notwithstanding anything to the contrary contained in the Master Lease, (i) no such consent shall be required for the assignment and transfer of the Master Lease to Lender or its nominee following the occurrence of an Event of Default under the Note or the Security Instrument or any of the other Loan Documents, or in connection with a Foreclosure (hereinafter defined) and (ii) Master Tenant shall not unreasonably withhold, condition or delay its consent to the purchase by an entity other than Lender (" Successor Owner ") at a sale by Lender or its nominee subsequent to such Foreclosure. As used in this Agreement, the term " Foreclosure " shall mean any exercise of the remedies available to the Lender or other holder of the Security Instrument, following the occurrence of a Default or Event of Default under the Security Instrument, which results in a transfer of title to or possession of the Property. The term "Foreclosure" shall include, without limitation: (A) a transfer by judicial or non-judicial foreclosure; (B) a transfer by deed in lieu of foreclosure; (C) the appointment by a court of a receiver to assume possession of the Property; (D) a transfer of either ownership or control of the Owner, by exercise of a stock pledge or otherwise; (E) a transfer resulting from an order given in a bankruptcy, reorganization, insolvency or similar proceeding; (F) if title to the Property is held by a tenant under a ground lease, an assignment of the tenant's interest in such ground lease; or (G) any similar judicial or non-judicial exercise of the remedies held by the Lender or other holder of the Security Instrument.

        3.     Subordination of Master Lease: Non-Disturbance.     

        (a)   The Master Lease as the same may hereafter be modified, amended, supplemented and/or extended in accordance with the terms of this Agreement, and all of Master Tenant's right, title and interest in and to the Property, are and all rights and privileges of Master Tenant to any management fee(s) paid thereunder are hereby and shall at all times be subject and subordinate to the Security Instrument and the lien thereof, to all the terms, conditions and provisions of the Security Instrument and to each and every advance made or hereafter made under the Security Instrument, and to all renewals, modifications, supplements, consolidations, replacements, substitutions and extensions of the Security Instrument, the Note and the other Loan Documents and the rights, privileges, and powers of Lender thereunder, so that at all times the Security Instrument shall be and remain a lien on the Property prior and superior to the Master Lease for all purposes.

        (b)   Lender agrees that, if Lender exercises any of its rights under the Loan Documents such that Lender (or a Successor Owner) becomes the owner of the Property, including but not limited to an entry pursuant to the Security Instrument, a foreclosure of the Security Instrument, a power of sale under the Security Instrument or otherwise: (a) the Master Lease shall continue in full force and effect as a direct master lease between Lender (or such Successor Owner, as applicable) and Master Tenant, and (b) Lender (or such Successor Owner, as applicable) shall not disturb Master Tenant's right of quiet possession of the premises demised under the Master Lease so long as Master Tenant is not in default (subject to any available notice requirements and/or grace periods) under any term, covenant or condition of the Master Lease or this Agreement.

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        4.     Termination.     At such time as the Loan is paid in full and the Security Instrument is released or assigned of record, this Agreement and all of Lender's right, title and interest hereunder with respect to the Master Lease shall terminate.

        5.     Master Tenant Estoppel.     Master Tenant represents and warrants that (a) the Master Lease is in full force and effect and has not been modified, amended, supplemented and/or assigned by Master Tenant other than pursuant to this Agreement, (b) Owner is not in default under any of the terms, covenants or provisions of the Master Lease and Master Tenant does not know of any event which, but for the passage of time or the giving of notice or both, would constitute an event of default by Owner under the Master Lease, and (c) Master Tenant has not commenced any action or given or received any notice for the purpose of terminating the Master Lease prior to its expiration according to the terms of the Master Lease.

        6.     No Amendment to Master Lease.     Each of Owner and Master Tenant hereby agrees that it shall not modify, amend, supplement and/or assign the Master Lease without first obtaining the prior written consent of Lender. In addition, Master Tenant hereby agrees that, at all times following notification by Lender that an Event of Default has occurred under the Note, the Security Instrument and/or the other Loan Documents, Master Tenant shall not further sublet any portion of the Property demised to it under the Master Lease, and that it shall not modify, amend, supplement and/or permit the assignment of any existing sublease without first obtaining the prior written consent of Lender not to be unreasonably withheld or delayed.

        7.     Release from Liability.     In the event Lender exercises any rights pursuant to this Agreement, Owner hereby releases Lender and Master Tenant from any liability, costs, damages or other obligations of Lender or Master Tenant to Owner as a result of such exercise of rights except to the extent arising directly from Lender's gross negligence or willful misconduct.

        8.     Liability Continued.     If a Successor Owner shall succeed to the interest of Owner under the Master Lease, in no event shall Successor Owner have any liability under the Master Lease prior to the date Successor Owner shall succeed to the interest of Owner under the Master Tenant, nor any liability for claims, offsets or defenses which Master Tenant might have had against Lender as Owner under the Master Lease prior to the date Successor Owner shall succeed to the interest of Owner under the Master Lease.

        9.     Attornment by Master Tenant.     Owner and Master Tenant hereby agree that upon notification by Lender that it wishes to succeed to the interest of Owner due to the occurrence an Event of Default has occurred under the Note, the Security Instrument and/or the other Loan Documents, or following conveyance of title to the Property, to the Successor Owner, Master Tenant shall attorn to the Successor Owner and shall continue to perform all of Master Tenant's obligations under the terms of the Master Lease with respect to the Property in accordance with the terms of the Master Lease.

        10.     Notice and Opportunity to Cure.     

        (a)   In the event of a default by Owner in the performance or observance of any of the terms and conditions of the Master Lease, Master Tenant shall give a duplicate copy (herein referred to as the " First Notice ") of any notice to be delivered to Owner pursuant to the terms of the Master Lease to Lender in accordance with Section 17 of this Agreement. In addition, in the event that such default is not cured within the applicable cure period under the terms of the Master Lease, and Master Tenant intends to exercise its remedy of terminating the Master Lease, Master Tenant shall send a second notice (the " Second Notice ") to Lender, in accordance with Section 17 hereof, stating Master Tenant's intention to terminate the Master Lease. Unless otherwise required by applicable law, Master Tenant shall forebear from taking any action to terminate the Master Lease for a period of thirty (30) days after the service of the First Notice, and for an additional period of sixty (60) days after the service of the Second Notice (if such Second Notice is required, as set

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forth above) for a monetary event of default or a non-monetary default which is susceptible to being cured by the Lender and for an additional period of two hundred seventy (270) days after the service of the Second Notice for an event of default of a non-monetary nature which is not susceptible to being cured by the Lender.

        (b)   No notice given by Master Tenant to Owner shall be effective as a notice under the terms of the Master Lease unless the applicable duplicate notice to Lender which is required under subsection (a) of this Section 10 (either the First Notice or the Second Notice, as the case may be) is given to Lender in accordance with this Agreement. It is understood that any failure by Master Tenant to give such a duplicate notice (either the First Notice or the Second Notice, as the case may be) to Lender shall not be a default by Master Tenant either under this Agreement or under the Master Lease, but rather shall operate only to void the effectiveness of any such notice by Master Tenant to Owner under the terms of the Master Lease.

        (c)   Master Tenant agrees to accept performance by Lender with the same force and effect as if performed by Owner, in accordance with the provisions and within the cure periods prescribed in the Master Lease (except that Lender shall have such additional cure periods, not available to Owner, as are set forth in subsection (a) hereof).

        11.     Lender's Right to Terminate.     Notwithstanding anything contained in the Master Lease to the contrary, Lender, or Owner at Lender's direction pursuant to the Loan Documents, shall have the right to terminate the Master Lease upon, or at any time after, (a) Master Tenant shall become insolvent or a debtor in a bankruptcy proceeding, (b) an Event of Default shall have occurred and be then continuing under the Note, the Security Instrument and/or under the other Loan Documents, or (c) a default has occurred and is continuing under the Master Lease, in each case, by giving Master Lease thirty (30) days' prior written notice of such termination, in which event Master Tenant shall resign as Master Tenant of the Property effective upon the end of such thirty (30)-day period. Master Tenant agrees not to look to Lender for payment of any accrued but unpaid fees relating to the Property.

        12.     New Master Lease.     Master Tenant agrees that in the event that the Lender forecloses on the Property pursuant to its rights and remedies under the Loan Documents, upon completion of the Foreclosure, Master Tenant shall, if requested by Lender, Lender's nominee, or any Successor Owner, enter into a new master lease with the Lender, Lender's nominee or any such Successor Owner on the same terms and conditions of the then-existing Master Lease.

        13.     Assignment of Proceeds.     As further security for the Note, Owner has executed and delivered to Lender an assignment of leases and rents which is contained within the granting clause of the Security Instrument, assigning to Lender, among other things, all of Owner's right, title and interest in and to all of the revenues of the Property. Master Tenant acknowledges disclosure of the aforesaid assignment.

        14.     Further Assurances.     Master Tenant further agrees to (a) execute such affidavits and certificates as Lender shall reasonably require to further evidence the agreements contained herein, (b) on written request from Lender, furnish Lender with copies of such information as Owner is entitled to under the Master Lease, and (c) cooperate with Lender's representative in any inspection of all or any portion of the Property. Master Tenant hereby acknowledges that some, or all, permits, licenses and authorizations necessary for the use, operation and maintenance of the Property (the " Permits ") may be held by, or on behalf of, the Master Tenant. By executing this Agreement, Master Tenant (x) agrees that it is, or will be, holding or providing all such Permits for the benefit of Owner and (v) hereby agrees that as security for repayment of the Debt by Owner in accordance with the Security Instrument, to the extent permitted by applicable law, Master Tenant hereby grants to Lender a security interest in and to the Permits. Moreover, Master Tenant hereby agrees that, following the occurrence of an Event of Default, it will continue to hold such Permits for the benefit of Lender. Master Tenant agrees that upon termination of the Master Lease, Master Tenant shall (to the extent

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assignable and to the extent permitted by law) assign to Owner or to the new Master Tenant all of Master Tenant's interest in such Permits at Owner's or such new Master Tenant's expense.

        15.     Default.     The occurrence of any of the following shall constitute an "Event of Default" hereunder:

        (a)   If Owner or Master Tenant fails to make any payment due under this Agreement within five days of the due date therefor.

        (b)   If Owner or Master Tenant fails to perform any other term or condition of this Agreement, and such failure can be cured but continues for thirty (30) days after notice thereof from Lender to such party; provided , that if such failure can be cured but, despite reasonable diligence, not within such time, the time to cure shall be extended up to an additional sixty (60) days if such party has commenced and diligently pursues cure of the default.

        (d)   Any representation or warranty made by Owner or Master Tenant hereunder shall have been false or misleading in any material respect.

        (e)   If the Master Lease is modified, amended, supplemented and/or assigned without the prior written consent of Lender.

The occurrence of an "Event of Default" hereunder shall also constitute an automatic "Event of Default" under, and as defined in the Note, the Security Instrument and the other Loan Documents, and the occurrence of an "Event of Default" under and as defined in the Note, the Security Instrument, and/or under any of the other Loan Documents shall constitute an automatic Event of Default under this Agreement.

        16.     Governing Law.     THE LOAN DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE IN WHICH THE PROPERTY IS LOCATED AND APPLICABLE FEDERAL LAW.

        17.     Notices.     All notices and other communications shall have been duly given and shall be effective (a) when delivered, (b) when transmitted via telecopy (or other facsimile device) to the number set forth below, (c) the day following the day on which the same has been delivered prepaid to a reputable national overnight air courier service, (d) the third (3 rd ) Business Day following the day on which the same is sent by certified or registered mail, postage prepaid, or (e) the day a communication sent by registered or certified mail, postage prepaid, is not accepted, in each case to the respective party at the address set forth below, or at such other address as such party may specify by written notice to the other party hereto. No notice of change of address shall be effective except upon actual receipt. This Section 17 shall not be construed in any way to affect or impair any waiver of notice or demand provided in any Loan Document or to require giving of notice or demand to or upon any Person in any situation or for any reason. In addition to the foregoing, the Master Tenant, Lender and Owner may, from time to time, specify to the other party additional notice parties by providing to the other party written notice of the name, address, telephone number and telecopy number of any such

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additional notice party. Each such additional notice party shall be entitled to receive and/or give any notice required or permitted to be given under this Agreement:

Address for Owner:

 

6267 Carpinteria Avenue, LLC
c/o Venoco, Inc.
6267 Carpinteria Avenue
Carpinteria, California 93013
Attention: Harry C. Harper
Facsimile: (805) 745-5146


Address for Master Tenant:


 


Venoco, Inc.
6267 Carpinteria Avenue
Carpinteria, California 93013
Attention: Harry C. Harper
Facsimile: (805) 745-5146


Address for Lender:


 


German American Capital Corporation
60 Wall Street, 11th Floor
New York, New York 10005
Attention.: Sandy Vergano
Facsimile: (732) 578-3928

        18.     No Oral Change.     This Agreement, and any provisions hereof, may not be modified, amended, waived, extended, changed, discharged or terminated orally or by any act or failure to act on the part of Owner, Lender or Master Tenant, but only by an agreement in writing signed by the party against whom enforcement of any modification, amendment, waiver, extension, change, discharge or termination is sought.

        19.     Successors and Assigns.     This Agreement shall be binding upon and inure to the benefit of Master Tenant, Owner and Lender and their respective successors and assigns forever. Moreover, the term "Lender", for the purposes of this Agreement, shall be deemed to include any nominee or designee appointed by Lender in connection with any Foreclosure and any Successor Owner to whom Master Tenant is required to attorn pursuant to Section 9 hereof.

        20.     Inapplicable Provisions.     If any term, covenant or condition of this Agreement is held to be invalid, illegal or unenforceable in any respect, this Agreement shall be construed without such provision.

        21.     Headings, etc.     The headings and captions of various paragraphs of this Agreement are for convenience of reference only and are not to be construed as defining or limiting, in any way, the scope or intent of the provisions hereof.

        22.     Duplicate Originals, Counterparts.     This Agreement may be executed in any number of duplicate originals and each duplicate original shall be deemed to be an original. This Agreement may be executed in several counterparts, each of which counterparts shall be deemed an original instrument and all of which together shall constitute a single Agreement. The failure of any party hereto to execute this Agreement, or any counterpart hereof, shall not relieve the other signatories from their obligations hereunder.

        23.     Number and Gender.     Whenever the context may require, any pronouns used herein shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns and pronouns shall include the plural and vice versa.

        24.     No Transfer.     Without the consent of Lender, Master Tenant shall not, except as expressly permitted in the Master Lease, sell, transfer, or assign any of Master Tenant's interest in the Master Lease.

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        25.     Miscellaneous.     Wherever pursuant to this Agreement it is provided that Owner shall pay any costs and expenses, such costs and expenses shall include, but not be limited to, legal fees and disbursements of Lender, whether retained fines, the reimbursement for the expenses of in-house staff or otherwise.

        26.     Survival of Agreement.     At such time as the Loan is paid in full the Security Instrument is released or assigned of record, this Agreement and all of Lender's right, title and interest hereunder with respect to the Master Lease shall terminate. Notwithstanding the foregoing, all provisions contained in this Agreement that pertain to the relationship of the Master Tenant to the Lender or the Lender's nominee in the event that the Lender or its nominee have succeeded to the interests of the Owner as "Owner" under the Master Lease, the terms of this Agreement shall survive until such time as the Lender or its nominee is no longer the "Owner" under the Master Lease.

[Signature Page Follows]

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        IN WITNESS WHEREOF the undersigned have executed this Agreement and Consent as of the date and year first written above.

 

 

OWNER:


 


 


6267 CARPINTERIA AVENUE, LLC,
a Delaware limited liability company


 


 


By:


Venoco, Inc.,
a Delaware corporation,
its Sole Member


 


 


By:


/s/  MICHAEL G. EDWARDS      


Name: Michael G. Edwards
Title: Vice President


 


 


MASTER TENANT:


 


 


VENOCO, INC.,
a Delaware corporation


 


 


By:


/s/  MICHAEL G. EDWARDS      


Name: Michael G. Edwards
Title: Vice President


 


 


LENDER:


 


 


GERMAN AMERICAN CAPITAL CORPORATION,
a Maryland corporation


 


 


By:


/s/  SANDY VERGANO      


Name: Sandy Vergano
Title: Vice President


 


 


By:


/s/  JMARTINI      


Name: Joanne Martini
Title: Authorized Signatory


STATE OF CALIFORNIA

 

)

 

 

)

COUNTY OF SANTA BARBARA

 

)

        On December 6, 2004, before me, Debra Lynn Hambleton, a Notary Public in and for said State, personally appeared Michael G. Edwards, personally known to me to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

        WITNESS my hand and official seal.

/s/  DEBRA LYNN HAMBLETON      


Notary Public

 

 


My Commission Expires: Mar. 7, 2008


[SEAL]


 


 

[NOTARIAL SEAL]

 

 


STATE OF CALIFORNIA

 

)

 

 

)

COUNTY OF SANTA BARBARA

 

)

        On December 6, 2004, before me, Debra Lynn Hambleton, a Notary Public in and for said State, personally appeared Michael G. Edwards, personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

        WITNESS my hand and official seal.

/s/  DEBRA LYNN HAMBLETON      


Notary Public

 

 


My Commission Expires: Mar. 7, 2008


[SEAL]


 


 

[NOTARIAL SEAL]

 

 


AMENDMENT TO LEASE

        This AMENDMENT TO LEASE, dated as of December 8, 2004 (this " Amendment "), is made by and among 6267 CARPINTERIA AVENUE, LLC, a Delaware limited liability company (" Landlord "), and VENOCO, INC., a Delaware corporation (" Tenant ").

R E C I T A L S:

A.

Bermant Development Company (as predecessor in interest to Carpinteria Bluffs Associates, LLC (" Seller "), as landlord, and Benton Oil and Gas Company (as predecessor in interest to Tenant), as tenant, entered into that certain Building Lease, dated November 7, 1996 (as heretofore amended, supplemented or modified, the " Lease "), providing for the lease of certain premises more particularly described in the Lease (the " Premises ") and located at 6267 Carpinteria Avenue, Carpinteria, CA (the " Property ").

B.

Pursuant to that certain Purchase and Sale Agreement and Joint Escrow Instructions, dated as of September 30, 2004 (the " Purchase Agreement "), between Seller and Tenant, Seller has sold the Property to Landlord (the wholly-owned subsidiary of Tenant), and Landlord purchased the Property from Seller.

C.

In connection with the sale of the Property pursuant to the Purchase Agreement, the parties hereto now desire to make certain amendments to the Lease, all as provided for in this Amendment.

        NOW, THEREFORE, for good and valuable consideration, the adequacy and receipt of which is hereby acknowledged, the parties hereto agree as follows:

A G R E E M E N T:

        1.     DEFINED TERMS.     Capitalized terms used and not otherwise defined herein shall have the meanings given such terms in the Lease. As used in this Amendment, " Effective Date " means December 8, 2004.

        2.     AMENDMENTS.     As of the Effective Date, Landlord and Tenant agree that the Lease is amended as follows:

        (a)     Annual Rent.     Annual rent under the Lease (excluding any additional rent due pursuant to Section 3.2 of the Lease) shall be $1,070,055 ($89,171.25 per month; $21.00 per square foot per year), subject to adjustment in accordance with the terms and conditions of the Lease.

        (b)     Definitions.      Section 3.4(a) of the Lease is hereby amended as follows:

        (i)    The definition of "Building Operating Expenses" shall be amended to include the following additional items:

        (A)  A property management fee of up to four percent (4%) of effective gross income derived from the Property by Landlord; and

        (B)  All of Landlord's actual administrative and overhead expenses.

        (ii)   The following clause is deleted from the end of the first paragraph of Section 3.4(a) : "and an amount equal to 12.5% of all such expenses to cover the Lessor's administrative and overhead expenses."

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        (c)     Rental Adjustment.      Section 3.5 of the Lease is hereby amended and restated in its entirety as follows:

        " 3.5    Rent Adjustment. Beginning on the fifth anniversary of the Rent Commencement Date and every five (5) years thereafter during the term of the Lease, annual rent shall be increased to an amount equal 110% of the annual rent for the immediately preceding five year period."

        (d)     Security Deposit.      Section 4 of the Lease is amended and restated in its entirety as follows:

        "4.     SECURITY DEPOSIT

        The security deposit under the Lease shall be an amount equal to one month's base rent."

        (e)     Term.      Section 5 of the Basic Lease Provisions is amended and restated such that the term of the Lease shall continue for fifteen (15) years after the Effective Date.

        (f)     Rent Commencement Date and Termination Date.      Section 6 of the Basic Lease Provisions is hereby amended such that the Rent Commencement Date shall be December 13, 2004 and the Termination Date shall be December 12, 2019.

        (g)     Damage or Destruction.      Section 8.3(b) of the Lease is amended and restated as follows:

        "(b) If the Lessor is obligated to repair the Premises because the repair can be completed within ninety (90) days or if the Lessor elects to repair the Premises as provided above, but does not commence such repair within one hundred twenty (120) days after the date of the casualty or does not diligently pursue such repair until completion, then, subject to any extension of up to another sixty (60) days for delay beyond the reasonable control of the Lessor, the Lessee may, at the Lessee's option, terminate this Lease by giving the Lessor written notice of the Lessee's election to terminate, in which event this Lease shall terminate thirty (30) days thereafter. If the Lessor is obligated to repair the Premises as a result of a Lessee's Notice and the conditions above are satisfied, there shall be no termination right on the part of the Lessee."

        (h)     Permitted Subletting.      Section 11.9 of the Lease (which section was added to the Lease pursuant to that certain First Amendment to Building Lease, dated as of May     , 2000) is hereby deleted in its entirety.

        (i)     References to Lease.     Upon the effectiveness of this Amendment, references in the Lease to "this Lease" or "the Lease" and similar references shall be deemed to be references to the Lease, as amended by this Amendment.

        3.     FURTHER ASSURANCES.     Each party hereto shall execute, acknowledge and deliver to the other parties all documents, and shall take all actions, reasonably required by such other parties from time to time to confirm or effect the matters set forth herein, or otherwise to carry out the purposes of this Amendment.

        4.     ATTORNEYS' FEES.     In the event that any litigation shall be commenced concerning this Amendment by any party hereto, the party prevailing in such litigation shall be entitled to recover, in addition to such other relief as may be granted, its reasonable costs and expenses, including, without limitation reasonable attorneys' fees and court costs, whether or not taxable, as awarded by a court of competent jurisdiction.

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        5.     NOTICES.     All notices, demands, approvals and other communications provided for in this Amendment shall be in writing and be delivered to the appropriate party at its address as follows:

If to Landlord:

 

6267 Carpinteria Avenue, LLC
c/o Venoco, Inc.
6267 Carpinteria Avenue
Carpinteria, CA 93013
Attention: Harry C. Harper, Esq.


If to Tenant:


 


Venoco, Inc.
6267 Carpinteria Avenue
Carpinteria, CA 93013
Attention: Harry C. Harper, Esq.

        Addresses for notice may be changed, from time to time, by written notice to all other parties. All communications shall be effective when actually received; provided, however , that non-receipt of any communication as the result of a change of address of which the sending party was not notified or as the result of a refusal to accept delivery shall be deemed receipt of such communication.

        6.     NO OTHER PARTIES BENEFITED.     This Amendment is made for the purpose of setting forth certain rights and obligations of Landlord and Tenant, and no other person shall have any rights hereunder or by reason hereof as a third party beneficiary or otherwise.

        7.     MISCELLANEOUS.     This Amendment shall bind, and shall inure to the benefit of, the successors and assigns of the parties hereto. Except as expressly modified herein, the Lease shall continue in full force and effect without change. This Amendment may be executed in counterparts with the same force and effect as if the parties had executed one instrument, and each such counterpart shall constitute an original hereof. No provision of this Amendment that is held to be inoperative, unenforceable or invalid shall affect the remaining provisions, and to this end all provisions hereof are hereby declared to be severable. Time is of the essence of this Amendment. This Amendment shall be governed by the laws of the State of California.

[Remainder of page intentionally left blank.]

3


        IN WITNESS WHEREOF, the parties have executed this Amendment as of the date first written above.

 

 

LANDLORD:


 


 


6267 CARPINTERIA AVENUE, LLC,
a Delaware limited liability company


 


 


By:


Venoco, Inc.

 

 

Its:

Member


 


 


By:


/s/  TIMOTHY MARQUEZ      


 


 


 


Name:


Timothy Marquez


 


 


 


Title:


Chief Executive Officer


 


 


 


TENANT:


 


 


VENOCO, INC.,
a Delaware corporation


 


 


By:


/s/  TIMOTHY MARQUEZ      


 


 


 


Name:


Timothy Marquez


 


 


 


Title:


Chief Executive Officer


 

4


RECORDING REQUESTED BY AND
WHEN RECORDED RETURN TO:

 

 


Sheppard, Mullin, Richter & Hampton LLP
800 Anacapa Street
Santa Barbara, CA 93101
Attention: James R. Haslem, Esq.


 


 

 

 


 

 

 

(Space above this line for Recorder's use only.)

ASSIGNMENT AND ASSUMPTION OF LEASES

         THIS ASSIGNMENT AND ASSUMPTION OF LEASES (this " Assignment ") is made and entered info as of December 8, 2004 (" Effective Date "), by and among CARPINTERIA BLUFFS ASSOCIATES, LLC, a California limited liability company (" Assignor ") and 6267 CARPINTERIA AVENUE, LLC, a Delaware limited liability company (" Assignee "), with reference to the following facts:


RECITALS

A.

Pursuant to that certain Purchase and Sale Agreement and Joint Escrow Instructions dated September 30, 2004 (" Purchase Agreement ") between Assignor and Assignee, Assignor agreed to sell to Assignee, and Assignee agreed to purchase from Assignor, certain real property located in the City of Carpinteria, County of Santa Barbara, State of California, and more particularly described in Exhibit A attached hereto (the " Property "), upon the terms and subject to the conditions set forth in the Purchase Agreement.

B.

Assignor and/or Assignor's predecessors entered into the Leases described in Exhibit B attached hereto (individually, " Lease " and collectively, " Leases ").

C.

Pursuant to the Purchase Agreement, the parties are obligated to enter this Assignment.

         NOW, THEREFORE , the parties to this Assignment, intending to be legally bound, do hereby covenant and agree as follows:

        1.     Assignment of Leases.     Effective as of the Effective Date, Assignor transfers and assigns to Assignee all of Assignor's right, title and interest and all of Assignor's duties and obligations as the Landlord under the Leases that arise or accrue after the Effective Date.

        2.     Acceptance of Assignment.     Effective as the Effective Date, Assignee accepts the assignment of all of Assignor's right, title and interest and assumes all of Assignor's duties and obligations as the Landlord under the Leases arising or accruing after the Effective Date.

        3.     Indemnification.     

        3.1     Indemnification by Assignor.     Assignor shall defend, indemnify, protect and hold harmless Assignee and its members, managers, officers, directors, employees, agents, representatives, affiliates, successors and assigns, from and against any and all demands, claims, actions, causes of action, damages, losses, fines, penalties, liabilities, obligations, costs and expenses, including, without limitation, attorneys' fees, arising out of, resulting from or relating to any act, event or occurrence relating to the Leases that accrued or arose prior to the Effective Date, including, without limitation, Assignor's performance or failure to perform any obligation, covenant, or condition under any of the Leases.

        3.2     Indemnification by Assignee.     Assignee shall defend, indemnify, protect and hold harmless Assignor and its partners, employees, agents, representatives, affiliates successors and assigns from

1


 

and against any and all demands, claims, actions, causes of action, damages, losses, fines, penalties, liabilities, obligations, costs and expenses, including, without limitation, attorneys' fees, arising out of, resulting from or relating to any act, event or occurrence relating to the Leases that accrues or arises after the Effective Date, including, without limitation, Assignee's performance or failure to perform any obligation, covenant, or condition under any of the Leases.

        4.     Attorneys' Fees.     In the event of any action or proceeding to enforce or construe any of the provisions of this Assignment, the prevailing party in any such action or proceeding shall be entitled to reasonable attorneys' fees and costs, whether or not such action or proceeding proceeds to final judgment.

        5.     Further Assurances.     Each of the parties shall, from time to time at the request of the other party, execute and deliver such other instruments and documents and shall take such other actions as may be required to consummate the transaction contemplated by this Assignment and/or carry out the purposes and terms of this Assignment.

        6.     Governing Law.     This Assignment shall be construed, interpreted and applied in accordance with the laws of the State of California.

        7.     Counterparts.     This Assignment may be executed in any number of counterparts, each of which shall be an original, but all of which shall constitute one and the same instrument.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

2


         IN WITNESS WHEREOF , the parties hereto have executed this Assignment as of the date first set forth above.

 

 

ASSIGNOR:


 


 


CARPINTERIA BLUFFS ASSOCIATES, LLC,
a California limned liability company


 


 


By:


/s/  JEFF C. BERMANT      


 


 


 


Name:


Jeffrey C. Bermant


 


 


 


Title:


President


 


 


 


ASSIGNEE:


 


 


6267 CARPINTERIA AVENUE, LLC,
a Delaware limited liability company


 


 


By:


Venoco, Inc.

 

 

Its:

Member


 


 


By:


/s/  TIMOTHY MARQUEZ      


 


 


 


Name:


Timothy Marquez


 


 


 


Title:


Chief Executive Officer


 

3


STATE OF

 

)

 

 

)ss.

COUNTY OF

 

)

        On December 7, 2004, before me, Elaine M. Georges, Notary Public, personally appeared Jeffrey C. Bermant, personally known to me OR proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

Witness my hand and official seal.
[NOTARY SEAL]

 

 

ELAINE M. GEORGES


(SIGNATURE OF NOTARY)

4


STATE OF CALIFORNIA

 

)

 

 

)

COUNTY OF SANTA BARBARA

 

)

        On December 3, 2004, before me, Debra Lynn Hambleton, a Notary Public in and for said State, personally appear Timothy Marquez, personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

        WITNESS my hand and official seal.

/s/  DEBRA LYNN HAMBLETON      


Notary Public

 

 


My Commission Expires: Mar. 7, 2008


[SEAL]


 


 

[NOTARIAL SEAL]

 

 

5


ASSIGNMENT AND ASSUMPTION OF LEASE

         THIS ASSIGNMENT AND ASSUMPTION OF LEASE (the "Assignment") is between BENTON OIL AND GAS COMPANY , a Delaware corporation (the "Assignor"), and VENOCO, INC. , a Delaware corporation (the "Assignee") and is made with reference to the following facts:

RECITALS:

 &nbs


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