EXHIBIT 10.13
SUBLEASE AGREEMENT
This Sublease is made and entered into as of March 1, 1999, by and between The
Vantive Corporation, a California corporation ("Sublessor"), and Active
Software, a California corporation ("Sublessee"), with respect to the following
facts:
Sublessor leases that certain free-standing one-story building located at
0000 Xxxxxxxx Xxxxx, Xxxxx Xxxxx, Xxxxxxxxxx consisting of approximately
24,000 square feet (the "Premises") pursuant to that certain Lease
Agreement dated September 4, 1996, between Xxxx Xxxxxxxxx, Trustee, or his
successor trustee, UTA dated 7/20/77 (Arrillaga Family Trust) as mended,
and Xxxxxxx X. Xxxxx, Trustee, or his successor trustee, UTA dated 7/20/77
(Xxxxxxx X. Xxxxx Separate Property Trust) as amended (together, the
"Landlord"), and Sublessor as the "Tenant" thereunder (the "Lease"). A copy
of the Lease is attached hereto as Attachment I.
1. Demise of Premises; Use: Sublessor leases to Sublessee and Sublessee leases
from Sublessor the entire Premises, as more particularly shown on Exhibit A to
the Lease, upon all of the terms, covenants and conditions contained in this
Sublease. Sublessee shall use the Premises for general office, software
development, research and development, and other uses in accordance with
Paragraph 1 of the Lease.
2. Basic Rent; Security Deposit; Operating Expenses:
2.1 Basic Rent. Beginning as of the Commencement Date, Sublessee shall
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pay to Sublessor as Basic Rent for the Premises the following sums, without
deduction, offset, prior notice or demand, for the periods indicated:
Months 1 through 12 $1.90 psf $45,600.00 per month
Months 13 through 24 $1.95 psf $46,800.00 per month
Months 25 through 36 $2.00 psf $48,000.00 per month
Months 37 through 48 $2.05 psf $49,200.00 per month
Months 49 through 55 $2.10 psf $50,400.00 per month
Basic Rent shall be payable by Sublessee to Sublessor in consecutive monthly
installments on or before the first day of each calendar month during the
Sublease Term.
2.2 Payment of First Month's Rent. Upon execution of this Sublease by
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Sublessee, Sublessee shall deposit with Sublessor the sum of Forty Five Thousand
Six Hundred Dollars ($45,600.00) as payment of the first month's Basic Rent.
2.3 Security Deposit. Upon execution of this Sublease by Sublessee,
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Sublessee shall deposit with Sublessor the sum of One Hundred Thirty-Six
Thousand Eight Hundred Dollars ($136,800.00), which sum shall be held by
Sublessor as a security deposit in accordance with the
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provisions of Paragraph 4.G. of the Lease. If Sublessee has not been in default
under this Sublease beyond any applicable cure period during the first twelve
(12) months of the Sublease Term, Sublessor shall decrease the security deposit
by Forty-Six Thousand Eight Hundred Dollars ($46,800.00) and apply said amount
to the Basic Rent owing for the thirteenth calendar month of the Sublease Term.
2.4 Additional Rent. Throughout the Sublease Term, Sublessee shall pay to
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Sublessor, in addition to Basic Rent, all items of additional rent described in
Paragraph 4.D. of the Lease ("Additional Rent") within the time periods
prescribed therein.
3. Sublease Term:
3.1 Sublease Term. The term of this Sublease (the "Sublease Term") shall
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commence on May 01, 1999 (the "Commencement Date") and expire four (4) years and
seven (7) months after the Commencement Date (the "Expiration Date"). In the
event the Lease is terminated for any reason other than a voluntary termination
by Sublessor or a termination resulting from Sublessor's breach of the Lease,
this Sublease shall terminate concurrently therewith without any liability of
Sublessor to Sublessee on account of such termination.
3.2 Delay in Commencement. If for any reason Sublessor cannot deliver
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possession of the Premises to Sublessee on the scheduled Commencement Date,
Sublessor shall not be subject to any liability on account of said failure to
deliver, nor shall such failure affect the validity of this Sublease or the
obligations of Sublessee hereunder or extend the term hereof, but in such event,
Sublessee shall not be obligated to pay rent or any additional mounts for the
Premises until possession of the Premises is tendered to Sublessee in the
condition required hereby. Notwithstanding the foregoing, if Sublessor cannot
deliver possession of the Premises to Sublessee by April 30, 1999, Sublessee may
elect to terminate this Sublease upon written notice to Sublessor at any time
prior to delivery of possession, and Sublessor shall promptly refund all monies
previously tendered by Sublessee.
3.3 Early Entry. Sublessor shall use its best efforts to prepare the
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Premises for entry by Sublessee and contractors by April 15, 1999, but in no
event later than April 26, 1999, provided the Landlord has previously consented
to this Sublease. Such entry shall be for the purpose of installing Sublessee's
trade fixtures and equipment, telephone equipment, security systems and cabling
for computers. Any entry or installation work by Sublessee and its contractors
in the Premises pursuant to this paragraph shall not be deemed to be occupancy
or possession of the Premises for purposes of this Sublease. Such early entry
shall be at Sublessee's own risk and all the terms and conditions of this
Sublease shall apply equally to such early entry, except that, so long as
Sublessee does not commence the use of the Premises for the purpose stated in
Paragraph 1 above, Sublessee shall have no obligation to pay Basic Rent,
utilities, real property taxes, property insurance premiums or operating
expenses during such early possession.
4. Provisions Constituting Sublease:
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4.1 Subject to Lease. This Sublease is subject and subordinate to all
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of the terms and conditions of the Lease. Sublessee shall not commit or permit
to be committed in or about the Premises any act or omission which shall violate
any of the terms or conditions of the Lease. Whenever the provisions of the
Lease incorporated as provisions of this Sublease require the written consent of
Landlord, said provisions shall be construed to require the written consent of
both Landlord and Sublessor, provided that Sublessor shall not unreasonably
withhold or delay its consent or approval if the Landlord has consented or
approved of the matter for which their consent or approval is sought. Sublessor
shall not modify the Lease in any way which will materially or adversely affect
the rights or obligations of Sublessee hereunder without the prior written
consent of Sublessee.
4.2 Incorporation. It is expressly understood, acknowledged and agreed by
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Sublessee that all of the other terms, conditions and covenants of this Sublease
shall be those stated in the Lease except as specifically excluded below,
modified as appropriate in the circumstances so as to make such Paragraphs
therein applicable only to the subleasing hereunder by Sublessor of the
Premises. Sublessee shall satisfy all applicable terms and conditions of the
Lease for the benefit of both Sublessor and Landlord, it being understood and
agreed that wherever in the Lease the word "Landlord" appears, for purposes of
this Sublease, the word "Sublessor" shall be substituted, and wherever in the
Lease the word "Tenant" appears, for purposes of this Sublease, the word
"Sublessee" shall be substituted. Notwithstanding the foregoing, Sublessor shall
not be responsible for the performance or the furnishing of any repair,
replacement or other obligations of Landlord under the Lease, and Sublessee
agrees to look solely to Landlord for the performance of such obligations. In
the event of any conflict between the express terms of this Sublease and the
incorporated provisions of the Lease, the terms of this Sublease shall control.
4.3 Exclusions from Lease. The terms and provisions of the following
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Paragraphs and portions of the Lease are not incorporated herein, or are
incorporated as modified below:
Preamble
Paragraph 2: Term
Paragraph 3: Possession
Paragraph 4.A.: Basic Rent
Paragraph 4.G.: Security Deposit is incorporated herein except that the
reference to the amount of the security deposit shall be replaced with the
amount specified above in Section 2.3.
Paragraph 43: Basic Rent.
Paragraph 44: As-Is Basis.
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Paragraph 59: Option To Extend Lease For Five (5) Years
4.4 Sublessor's Obligations. Sublessor agrees to maintain the Lease in
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force during the entire term of this Sublease and to pay rent to Landlord in
accordance with the terms of the Lease; subject, however, to any earlier
termination of the Lease without the fault of the Sublessor. Sublessor shall use
commercially reasonable efforts to cause Landlord to perform its obligations
under the Lease for the benefit of Sublessee. Sublessor hereby assigns to
Sublessee all of Sublessor's rights, privileges and causes of action against
Landlord in connection with the Lease, and Sublessee shall be entitled to
exercise all of Sublessor's rights, privileges and causes of action in that
regard, provided that if Sublessee exercises any of such rights of Sublessor,
Sublessee shall indemnify, defend, protect and hold harmless Sublessor from and
against all claims, expenses (including reasonable attorneys' fees),
liabilities, penalties and damages ("Claims") arising from such litigation or
enforcement action, except for Claims arising from Sublessor's gross negligence
or willful misconduct. Notwithstanding the foregoing, Sublessee agrees not to
exercise its rights under the foregoing sentence unless Sublessor fails to take
all reasonable actions required to fully enforce the Landlord's obligations
promptly after written demand upon Sublessor by Sublessee.
5. Sublessor's Representations. To the best of Sublessor's knowledge, and in
addition to the representations and warranties set forth in Section 12 below,
Sublessor represents and warrants with respect to the Premises that:
A. The document attached hereto as Attachment I is a true, correct
and complete copy of the Lease and the term of the Lease does not expire prior
to the Expiration Date hereof. The Lease is in full force and effect, and there
exists under the Lease no default or event of default, nor has there occurred
any event which, with the giving of notice Or passage of time or both, could
constitute such a default or event of default.
B. There are no pending or threatened actions, suits or proceedings
before any court or administrative agency against Sublessor or against Landlord
which could, in the aggregate, adversely affect the Premises or the ability of
Landlord to perform its obligations under the Lease or of Sublessor to perform
its obligations under this Sublease, and Sublessor is not aware of any facts
which might result in any such actions, suits or proceedings.
C. Sublessor has not received any notice from any insurance company
of any defects or inadequacies in the Premises or any part thereof which could
adversely affect the insurability of the Premises or the premiums for the
insurance thereof.
D. Except as expressly set forth in Section 5, Section 6 and Section
12 hereof, Sublessor makes no warranty or representation of any kind whatsoever
as to the use or occupancy which may be made of the Premises, nor as to the
condition or repair of the Premises, including without limitation, the condition
or functionality of the cabling in and to the Premises.
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6. Condition of Premises. Sublessor shall deliver the Premises to Sublessee in
"broom clean" condition and with the HVAC, plumbing, electrical systems,
existing tenant improvements and roof membrane in good condition and repair. If
during the first ninety (90) days after the Commencement Date (the "Warranty
Period"), the foregoing items are not in the condition required hereby,
Sublessee shall promptly notify Sublessor of the need for repair, and the repair
shall be promptly completed at no expense to Sublessee. Except with respect to
necessary repairs for which Sublessor receives written notice within five (5)
days after the expiration of the Warranty Period, Sublessor shall have no
liability or responsibility for the repair of such items. Sublessor and
Sublessee agree and acknowledge that prior to the Commencement Date Sublessor
may remove all of its furniture and personal property from the Premises.
7. Alterations: Sublessee's rights to make alterations to the Premises are
subject to the provisions of Paragraph 9 of the Lease, including without
limitation the requirement that Sublessee obtain the consent of Sublessor and
Landlord prior to making any proposed alterations or additions. Sublessor shall
provide Sublessee with an improvement allowance (the "Allowance") equal to $1.50
per square foot of the Premises or Thirty Six Thousand Dollars ($36,000.00) to
be applied toward costs incurred at the outset of the Sublease Term for (i)
making improvements to the Premises and (ii) cleaning and maintenance work in
the Premises, including painting and carpet cleaning (collectively, the "Tenant
Improvements"). The Allowance (or such lesser amount actually spent by Sublessee
on the Tenant Improvements) shall be paid to Sublessee's contractor or other
service provider, as appropriate, within thirty (30) days after receipt of (i)
the final invoice, (ii) proof of payment as to any portion of the final invoice
to be paid by Sublessee, (iii) a conditional lien release in the form prescribed
by (S) 3262 of the California Civil Code (Conditional Waiver And Release Upon
Final Payment), and (iv) proof of recordation of a notice of completion for the
improvements. As to (iii) and (iv) above, such conditions to payment of the
Allowance shall be applicable only if the nature of the work performed is such
that the attachment of a lien to the Premises in connection therewith is
possible. Notwithstanding anything to the contrary contained in this Sublease or
the Lease, Sublessee shall not be (a) obligated to remove the alterations
installed in the Premises by or on behalf of Sublessor upon the expiration or
earlier termination of this Sublease, or (b) liable for any violations of law by
Sublessor or Sublessor's agents or contractors.
8. Repairs and Maintenance of Premises: All of the Tenant's repair and
maintenance obligations set forth in the Lease with respect to the Premises have
been incorporated herein pursuant to Paragraph 4 above and shall be the
responsibility of Sublessee.
9. Insurance. Sublessee agrees to carry the insurance coverage described in
Paragraph 13 of the Lease during the term of this Sublease. Sublessee shall name
Sublessor and Landlord as additional insureds under the required insurance
policies. Upon execution of this Sublease, Sublessee shall deliver a certificate
of insurance evidencing the above to Sublessor.
10. Signs: Sublessee shall be allowed to place a sign on the front door of the
Premises and on
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the exterior monument sign boards, subject to the terms and conditions of the
Lease. Sublessee shall be responsible for the cost of its signage.
11. [Intentionally Deleted].
12. Hazardous Materials: Sublessor, to the best of Sublessor's knowledge,
represents and warrants to Sublessee that, as of the Commencement Date the
Premises and the operations conducted thereon by Sublessor prior to the
Commencement Date are in compliance with all Environmental Laws. Sublessor
further represents and warrants that, to the best of Sublessor's knowledge, no
litigation has been brought or threatened, nor any settlements reached with any
governmental or private party, concerning the actual or alleged presence or
Hazardous Materials on or about the Premises nor has Sublessor received any
notice of any violation or alleged violation of any Environmental Laws relating
to the Premises. Sublessee, its agents, employees, contractors, officers,
directors, shareholders, successors or assigns shall not be responsible for, and
Sublessor shall indemnify, defend with counsel reasonably acceptable to
Sublessee and hold Sublessee harmless against any claim, obligation, liability,
cause of action, penalty, attorneys' fees, consultants' cost, expense or damage
owing or alleged to be owing with respect to any Hazardous Materials caused by
Sublessor, its agents, employees or contractors to be present on or about the
Premises prior to the Commencement Date. Sublessor's representations and
indemnification under this Section 12 shall survive the termination of this
Sublease and the Lease. Notwithstanding the foregoing, Paragraph 50 of the Lease
regarding Hazardous Materials is incorporated herein pursuant to Paragraph 4.2
of this Sublease.
13. Termination of Lease by Sublessor. Notwithstanding the provisions of
Paragraph 16 of this Sublease, Sublessor shall not voluntarily terminate the
Lease during the Sublease Term unless and until Landlord has agreed in writing
to continue this Sublease in full force and effect as a direct lease between
Landlord and Sublessee upon and subject to all of the terms, covenants and
conditions of this Sublease for the balance of the Sublease Term. If Landlord so
consents, Sublessee shall attorn to Landlord in connection with any such
voluntary termination and shall execute an attornment agreement in such form as
may reasonably be requested by Landlord; provided, however, that the attornment
agreement does not materially or adversely affect the use by Sublessee of the
Premises in accordance with the terms of this Sublease, materially increase
Sublessee's obligations under this Sublease or materially decrease Sublessee's
rights under this Sublease.
14. Authorization to Direct Sublease Payments. Sublessor hereby acknowledges
that Sublessor's failure to pay the Basic Rent and other sums owing by Sublessor
to Landlord under the Lease will cause Sublessee to incur damages, costs and
expenses not contemplated by this Sublease, especially in those cases where
Sublessee has paid sums to Sublessor hereunder which correspond in whole or in
part to the mounts owing by Sublessor to Landlord under the Lease. Accordingly,
Sublessee shall have the right to pay all rent and other sums owing by Sublessee
to Sublessor hereunder for those items which also are owed by Sublessor to
Landlord under the Lease directly to Landlord if either (i) Sublessee reasonably
believes that Sublessor has failed to
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make any payment required to be made by Sublessor to Landlord under the Lease
and Sublessor fails to provide adequate proof of payment within two (2) business
days after Sublessee's written demand requesting such proof; or (ii) Sublessee
reasonably believes that Sublessor shall fail to make any payment required to be
made by Sublessor to Sublessee under the Lease and Sublessor fails to provide
assurance of future performance within two (2) business days after Sublessee's
written demand requesting such assurance. Sublessee agrees to provide to
Sublessor concurrently with any payment to Landlord reasonable evidence of such
payment. If Sublessor notifies Sublessee that it disputes any mount demanded by
Landlord, Sublessee shall not make any such payment to Landlord unless Landlord
has provided a three-day notice to pay such amount or forfeit the Lease. Any
sums paid directly by Sublessee to Landlord in accordance with this Section
shall be credited toward the mounts payable by Sublessee to Sublessor under this
Sublease.
15. Quiet Enjoyment; Right to Cure. Sublessee shall peacefully have, hold and
enjoy the Premises, subject to the terms and conditions of this Sublease,
provided that Sublessee pays all Rent and Additional Rent and performs all of
Sublessee's covenants and agreements contained herein. In the event, however,
that Sublessor defaults in the performance or observance of any of its
obligations under the Lease or fails to perform Sublessor's stated obligations
under this Sublease to enforce, for Sublessee's benefit, the Landlord's
obligations under the Lease, then Sublessee shall give Sublessor notice
specifying in what manner Sublessor has defaulted, and if such default shall not
be cured by Sublessor within thirty (30) days thereafter (except that if such
default cannot be cured within said thirty (30)-day period, this period shall be
extended for an additional reasonable time, provided that Sublessor commences to
cure such default within such thirty (30)-day period and proceeds diligently
thereafter to effect such cure as quickly as possible), then in addition,
Sublessee shall be entitled, at Sublessee's option, to cure such default and
promptly collect from Sublessor Sublessee's reasonable expenses in so doing
(including, without limitation, reasonable attorneys' fees and court costs).
Sublessee shall not be required, however, to wait the entire cure period
described herein if earlier action is required to avoid a forfeiture of the
Lease or to comply with any applicable governmental law, regulation or order.
16. Assignment and Subleasing. Sublessee shall be permitted to further
sublease the Premises or assign this Sublease, subject to the prior consent of
the Landlord and Sublessor in accordance with Paragraph 49 of the Lease. For
purposes hereof, the sale of Sublessee's stock on any public exchange shall not
be deemed a sublease or assignment.
If Landlord and Sublessor jointly and voluntarily elect, for any reason
whatsoever, to terminate the Lease prior to the scheduled Lease termination
date, then this Sublease (if then still in effect) shall terminate concurrently
with the termination of the Lease. Sublessee expressly acknowledges and agrees
that (i) the voluntary termination of the Lease by Landlord and Sublessor and
the resulting termination of this Sublease shall not give Sublessee any right or
power to make any legal or equitable claim against Landlord, including without
limitation any claim for interference with contract or interference with
prospective economic advantage, and (ii) Sublessee hereby waives any and all
rights it may have under law or at equity against Landlord
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to challenge such an early termination of the Sublease, and unconditionally
releases and relieves Landlord, and its officers, directors, employees and
agents, from any and all claims, demands, and/or causes of action whatsoever
(collectively, "Claims"), whether such matters are known or unknown, latent or
apparent, suspected or unsuspected, foreseeable or unforeseeable, which
Sublessee may have arising out of or in connection with any such early
termination of this Sublease. Sublessee knowingly and intentionally waives any
and all protection which is or may be given by Section 1542 of the California
Civil Code which provides as follows: "A general release does not extend to
claims which the creditor does not know or suspect to exist in his favor at the
time of executing the release, which if known by him must have materially
affected his settlement with debtor."
The term of this Sublease is therefore subject to early termination.
Sublessee's initials here below evidence (a) Sublessee's consideration of and
agreement to this early termination provision, (b) Sublessee's acknowledgment
that, in determining the net benefits to be derived by Sublessee under the terms
of this Sublease, Sublessee has anticipated the potential for early termination,
and (c) Subtenant's agreement to the general waiver and release of Claims above.
Initials: JB Initials:________
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Sublessee Sublessor
17. Attorneys' Fees. If either Sublessor or Sublessee brings any action or
proceeding, whether legal, equitable or administrative, to enforce rights and
obligations under this Sublease, or to declare rights hereunder, the prevailing
party in any such action or proceeding shall be entitled to recover from the
other party reasonable attorneys' fees and costs of suit, in addition to any
other relief allowed by the court.
18. Brokers. Sublessor is represented by Xxxxxxx & Xxxxxxxxx of California,
Inc. and Sublessee is represented by Xxxxx Xxxxxx Associates. The parties agree
that no other brokers have been involved in this transaction and they each agree
to indemnify and hold each other harmless from and against any damage or expense
incurred by reason of any other broker claiming a right to any commission or
compensation as a result of its dealings with the indemnifying, party.
19. Authority to Execute. Sublessee and Sublessor each represent and warrant
to the other that the person(s) executing this Sublease on behalf of each party
is (are) duly authorized to execute and deliver this Sublease on that party's
behalf.
20. Incorporation of Prior Agreements. This Sublease incorporates all
agreements of the parties with respect to the subject matter hereof, and
supersedes all prior agreements and understandings of the parties, whether oral
or written, pertaining to the subject matter hereof.
21. Modifications. This Sublease may be modified or amended only by an
instrument in writing, executed by both parties in interest hereunder.
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22. Governing Law; Severability. This Sublease shah be governed by and
construed in accordance with the laws of the State of California. If any term or
provision of this Sublease is found by a court of competent jurisdiction to be
void or unenforceable, such term or provision shall be deemed severed from the
remainder of the terms and provisions of this Sublease, and said remainder shall
remain in full force and effect, according to its terms, to the extent permitted
by law.
23. Notices: All notices, demands, consents and approvals which may or are
required to be given by either party to the other hereunder shall be given in
the manner provided in the Lease, at the addresses shown on the signature page
hereof. Sublessor shall promptly provide to Sublessee copies of written notices
received from the Landlord which pertain to the Premises.
24. Condition: The obligations of the parties to the Sublease are conditioned
upon receipt of the consent of the Landlord on terms reasonably satisfactory to
both parties, including in the case of Sublessee, consent by the Landlord to the
installation of Alterations proposed to be made by Sublessee to the Premises
and, if such consent has not been received with thirty (30) days after the
execution and delivery of this Sublease by both parties, either party may
terminate this Sublease effective upon written notice to the other, delivered at
any time until the consent of Landlord as provided above shall have been
delivered to Sublessee. Sublessor agrees to promptly seek the written consent of
Landlord to this Sublease upon Sublessee's execution and delivery hereof to
Sublessor.
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IN WITNESS WHEREOF the parties have executed this Sublease intending to be bound
as of the date of execution and delivery by both parties, and satisfaction of
the condition set forth above.
SUBLESSOR: SUBLESSEE:
THE VANTIVE CORPORATION, ACTIVE SOFTWARE,
A California Corporation A California Corporation
By: The Vantive Corporation By: Xxx X. Xxxx
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Date: 3/23/99 Date: 3.19.99
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Title: CFO Title: CFO
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Address:___________________ Address:___________________
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ATTACHMENT I
Lease
CONSENT OF LANDLORD
The undersigned, Landlord under the Lease attached as Attachment I, hereby
consents to the subletting of the Premises described herein on the terms and
conditions contained in the Sublease dated as of March 1, 1999, by and between
The Vantive Corporation and Active Software. This Consent shall apply only to
this Sublease and shall not be deemed to be a consent to any other subletting or
assignment.
In the event the Lease is terminated prior to the expiration date thereof,
Landlord agrees to recognize Sublessee as the tenant of the Premises, provided
that Sublessee is not then be in default beyond any applicable cure period, and
the Sublease shall continue in full force and effect as a direct lease between
Landlord and Sublessee under the terms and conditions of the Sublease.
Landlord:
Xxxx Xxxxxxxxx Survivor's Trust
By:
Xxxx Xxxxxxxxx, Trustee
Date:________________________________
Xxxxxxx X. Xxxxx Separate Property Trust
By:
Xxxxxxx X. Xxxxx, Trustee
Date:
Date:
LEASE AGREEMENT
THIS LEASE, made this 4th day of September , 1996 between XXXX XXXXXXXXX,
Trustee, or his Successor Trustee, UTA dated 7/20/77 (ARRILLAGA FAMILY TRUST) as
amended and XXXXXXX X. XXXXX, Trustee, or his Successor Trustee, UTA dated
7/20/77 (XXXXXXX X. XXXXX SEPARATE PROPERTY TRUST) as amended , hereinafter
called Landlord, And THE VANTIVE CORPORATION, a California corporation
hereinafter called Tenant.
WITNESSETH:
Landlord hereby leases to Tenant and Tenant hereby hires and takes from
Landlord those certain premises (the "Premises") outlined in red on Exhibit "A",
attached hereto and incorporated herein by this reference thereto more
particularly described as follows:
All of that certain 24,000 +/- square foot, one-story building located
at 0000 Xxxxxxxx Xxxxx, Xxxxx Xxxxx, Xxxxxxxxxx 00000. Said Premises
is more particularly shown within the area outlined in Red on Exhibit
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A. The entire parcel, of which the Premises is a part, is shown within
-
the area outlined in Green on Exhibit A attached hereto. The Premises
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is leased on an "as-is" basis, in its present condition, and in the
configuration as shown in Red on Exhibit B attached hereto.
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As used herein the Complex shall mean and include all of the land outlined in
Green and described in Exhibit "A", attached hereto, and all of the buildings,
improvements, fixtures and equipment now or hereafter situated on said land.
Said letting and hiring is upon and subject to the terms, covenants
and conditions hereinafter set forth and Tenant covenants as a material part
of the consideration for this Lease to Perform and observe each and all of
said terms, covenants and conditions. This Lease is made upon the conditions
of such performance and observance.
1. USE Tenant shall use the Premises only in conformance with applicable
governmental laws, regulations, rules and ordinances for the purpose of general
office, light manufacturing, research and development, and storage and other
uses necessary for Tenant to conduct Tenant's business, provided that such uses
shall be, in accordance with all applicable governmental laws and ordinances and
for no other purpose. Tenant shall not do or permit to be done in or about the
Premises or the Complex nor bring or keep or permit to be brought or kept in or
about the Premises or the Complex anything which is prohibited by or will in any
way increase the existing rate of (or otherwise affect) fire or any insurance
covering the Complex or any part thereof, (unless Tenant agrees to pay any
increased portion of any premium for such insurance) or any of its contents, or
will cause a cancellation of any insurance covering the Complex or any part
thereof, or any of its contents. Tenant shall not do or permit to be done
anything in, on or about the Premises or the Complex which will in any way
obstruct or interfere with the rights of other tenants or occupants of the
Complex or injure or annoy them, or use or allow the Premises to be used for any
unlawful purpose, nor shall Tenant cause, maintain or permit any nuisance in, on
or about the Premises or the Complex. No sale by auction shall be permitted on
the Premises. Tenant shall not place any loads upon the floors, walls, or
ceiling, which endanger the structure, or place any harmful fluids or other
materials in the drainage system of the building, or overload existing
electrical or other mechanical systems. No waste materials or refuse shall be
dumped upon or permitted to remain upon any part of the Premises or outside of
the building in which the Premises are a part, except in trash containers placed
inside exterior enclosures designated by Landlord for that purpose or inside of
the building proper where designated by Landlord. No materials supplies,
equipment, finished products or semi-finished products, raw materials or
articles of any nature shall be stored upon or permitted to remain outside the
Premises or on any portion of common area of the Complex. No loudspeaker or
other device, system or apparatus which can be heard outside the Premises shall
be used in or at the Premises without the prior written consent of Landlord.
Tenant shall not commit or suffer to be committed any waste in or upon the
Premises. Tenant shall indemnify, defend and hold Landlord harmless against any
loss, expense, damage, attorneys' fees, or liability arising out of failure to
Tenant to comply with any applicable law, governing Tenant's use of the
Premises. Tenant shall comply with any covenant, condition, or restriction
("CC&R's") affecting the Premises, of which Tenant has notice. The provisions of
this paragraph are for the benefit of Landlord only and shall not be construed
to be for the benefit of any tenant or occupant of the Complex.
2. TERM It is agreed in the event said Lease commences on a date other than
the first day of the month the term of the Lease will be extended to account for
the number of days in the partial month. The Basic Rent during the resulting
partial month will be pro-rated (for the number of days in the partial month) at
the Basic Rent scheduled for the projected commencement date as shown in
Paragraph 43.
A. The term of the lease shall be for a period of SEVEN ( 7) YEARS
(unless sooner terminated as hereinafter provided) and, subject to Paragraphs
2(B) and 3, shall commence on the 1st day of January , 1997 and end the 31st day
December , of 2003.
B. Possessions of the Premises shall be deemed tendered and the term of
this Lease shall commence on January 1, 1997, or
(d) As otherwise agreed in writing.
3. POSSESSION If Landlord, for any reason whatsoever, cannot deliver
possession of said premises to Tenant at the commencement of the said term, as
hereinbefore specified, this Lease shall not be void or voidable; no obligation
of Tenant shall be affected thereby; nor shall Landlord or Landlord's agents be
liable to Tenant for any loss or damage resulting therefrom; but in that event
the commencement and termination dates of the Lease, and all other dates
affected thereby shall be revised to conform to the date of Landlord's delivery
of possession, as specified in Paragraph 2(b), above. The above is, however,
subject to the provision that the period of delay, of delivery of the premises
shall not exceed 30 days from the commencement date herein (except those delays
caused by Acts of God, strikes, war utilities, governmental bodies, weather,
unavailable materials, and delays beyond Landlord's control shall be excluded in
calculating such period) in which instance Tenant, at its option, may, by
written notice to Landlord, terminate this Lease.
It is agreed in the event said Lease commences on a date other than the first
day of the month the term of the lease will be extended to account for the
number of days in the partial month. The Basic Rent during the resulting partial
month will be pro-rated (for the number of days in the partial month) at the
Basic Rent scheduled for the projected commencement date as shown, in Paragraph
43.
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4. RENT
A. Basic Rent. Tenant agrees to pay to Landlord at such place as Landlord
may designate without deduction, offset, prior notice, or demand, and Landlord
agrees to accept as Basic Rent for the leased Premises the total sum of FOUR
MILLION THIRTY TWO THOUSAND AND NO/10 IS 4,032,000.00) Dollars in lawful money
of the United States of America, payable as follows:
See Paragraph 43 for Basic Rent Schedule
B. Time for Payment. In the event that the term of this Lease commences
on a date other than the first day of a calendar month, on the date of
commencement of the term hereof Tenant shall pay to Landlord as rent for the
period from such date of commencement to the first day of the next succeeding
calendar month that proportion of the monthly rent hereunder which the number of
days between such date of commencement and the first day of the next succeeding
calendar month bears to thirty (30) in the event that the term of this Lease for
any reason ends on a date other than the last day of a calendar month, on the
first day of the last calendar month of the term hereof Tenant shall pay to
Landlord as rent for the period from said first day of said last calendar month
to and including the last day of the term hereof that proportion of the monthly
rent hereunder which the number of days between said first day of said last
calendar month and the last day of the term hereof bears to thirty (30).
C. Late Charge. Notwithstanding any other provision of this Lease, if
Tenant is in default in the payment of rental as set forth in this Paragraph 4
when due, or any part thereof, Tenant agrees to pay Landlord, in addition to the
delinquent rental due, a late charge for each rental payment in default ten (10)
days. Said late charge shall equal ten (10%) percent of each rental payment so
in default.
D. Additional Rent. Beginning with the commencement date of the term of
this Lease, Tenant shall pay to Landlord in addition to the Basic Rent and as
Additional Rent the following:
(a) Tenant's proportionate share of all Taxes relating to the Complex as
set forth in Paragraph 12, and
(b) Tenant's proportionate share of all insurance premiums relating to the
Complex, as set forth in Paragraph 15, and
(c) Tenant's proportionate share of expenses for the operation,
management, maintenance and repair of the Building (including common
areas of the Building) and Common Areas of the Complex in which the
Premises are located as set forth in Paragraph 7, and
(d) All charges, costs and expenses, which Tenant is required to pay
hereunder, together with all interest and penalties, costs and
expenses including attorneys' fees and legal expenses, that may accrue
thereto in the event of Tenant's failure to pay such amounts, and all
damages, reasonable costs and expenses which Landlord may incur by
reason of default of Tenant or failure on Tenant's part to comply with
the terms of this Lease. In the event of nonpayment by Tenant of
Additional Rent, Landlord shall have all the rights and remedies with
respect thereto as Landlord has for nonpayment of rent.
The additional Rent due hereunder shall be paid to Landlord or Landlord's agent
(i) within five days for taxes and insurance and within thirty (30) days for all
other Additional Rent items after presentation of invoice from Landlord or
Landlord's agent setting forth such Additional Rent and/or (ii) at the option of
Landlord. Tenant shall pay to Landlord monthly, in advance, Tenant's prorata
share of an amount estimated by Landlord to be Landlord's approximate average
monthly expenditure for such Additional Rent items, which estimated amount shall
be reconciled at within 120 days of at the end of each calendar year or more
frequently if Landlord so elects to do so at Landlord's sole and absolute
discretion, as compared to Landlord's actual expenditure for said Additional
Rent items, with Tenant paying to Landlord, upon demand, any amount of actual
expenses expended by Landlord in excess of said estimated amount, or Landlord
refunding to Tenant (providing Tenant is not in default in the performance of
any of the terms, covenants and conditions of this Lease) any amount of
estimated payments made by Tenant in excess of Landlord's actual expenditures
for said Additional Rent items.
The respective obligations of Landlord and Tenant under this paragraph
shall survive the expiration or other termination of the term of this Lease, and
if the term hereof shall expire or shall otherwise terminate on a day other than
the last day of a calendar year, the actual Additional Rent incurred for the
calendar year in which the term hereof expires or otherwise terminates shall be
determined and settled on the basis of the statement of actual Additional Rent
for such calendar year and shall be prorated in the proportion which the number
of days in such calendar year preceding such expiration of termination bears to
365. See Paragraph 54
E. Fixed Management Fee. Beginning with the Commencement Date of the Term
of this Lease, Tenant shall pay to Landlord, in addition to the Basic Rent and
Additional Rent, a fixed monthly management fee equal to 2% of the Basic Rent
due for each month during the Lease Term ("Management Fee").
F. Place of Payment of Rent and Additional Rent. All basic Rent hereunder
and all payments hereunder for Additional Rent shall be paid to Landlord at the
office of Landlord at Xxxxx/Xxxxxxxxx, file 1504, box 60000, Xxx Xxxxxxxxx, XX
00000 or to such other person or to such other place as Landlord may from time
to time designate in writing.
G. Security Deposit. Concurrently with Tenant's execution of this Lease,
Tenant shall deposit with Landlord the sum or ONE HUNDRED THREE THOUSAND TWO
HUNDRED AND NO 100. ($103, 200.00) Dollars. Said sum shall be held by Landlord
as a Security Deposit for the faithful performance by Tenant of all of the
terms., covenants, and conditions of this Lease to be kept and performed by
Tenant during the term hereof. If Tenant defaults with respect to any provisions
of this Lease, including, but not limited to, the provisions relating to the
payment of rent and any of the monetary sums due herewith. Landlord may (but
shall not be required to) use, apply or retain all or any part of this Security
Deposit for the payment of any other amount which Landlord may spend by reason
of Tenant's default or to compensate Landlord for any other loss or damage which
Landlord may suffer by reason of Tenant's default. If any portion of said
Deposit is so used or applied, Tenant shall, within ten (10) days after written
demand therefor, deposit cash with Landlord in the amount sufficient to restore
the Security Deposit to its original amount. Tenant's failure to do so shall be
a material breach of this Lease. Landlord shall not be required to deep this
Security Deposit separate from its general funds, and Tenant shall not be
entitled to interest on such Deposit. If Tenant full and faithfully performs
every provision of this Lease to be performed by it, the Security Deposit to any
balance thereof shall be returned to Tenant (or at Landlord's option, to the
last assignee of Tenant's interest hereunder) within thirty (30) days following
the expiration of this Lease term and after Tenant has vacated the Premises. In
the event of termination of Landlord's interest in this Lease, Landlord shall
transfer said Deposit to Landlord's successor in interest whereupon Tenant
agrees to release Landlord from liability for the return of such deposit or the
accounting therefor.
5. RULES AND REGULATIONS AND COMMON AREA Subject to the terms and conditions
of this Lease and such reasonable Rules and Regulations as Landlord may from
time to time prescribe, Tenant and Tenant's employees, invitees and customers
shall, in common with other occupants of the Complex in which the Premises are
located, and their respective employees, invitees and customers, and others
entitled to the use thereof, have the non-exclusive right to use the access
roads, parking areas, and facilities provided and designated by Landlord for the
general use and convenience of the occupants of the Complex in which the
Premises are located, which areas and facilities are referred to herein as
"Common Area". This right shall terminate upon the termination of this Lease.
Landlord reserves the right from time to time to make changes in the shape, size
location, amount and extent of Common Area. Landlord further reserves the right
to promulgate such reasonable rules and regulations relating to the use of the
Common Area, and any part or parts thereof, as Landlord may deem appropriate for
the best interests of the occupants of the Complex. The Rules and Regulations
shall be bringing upon Tenant upon delivery of a copy of them to Tenant, and
Tenant shall abide by them and cooperate in their observance. Such Rules and
Regulations may be amended by Landlord from time to time , with or without
advance notice, and all amendments shall be effective upon delivery of a copy to
Tenant. Landlord shall not be responsible to Tenant for the non-performance by
any other tenant or occupant of the Complex of any of said Rules and
Regulations.
Landlord shall operate, manage and maintain the Common Area. The manner in
which the Common Area shall be maintained and the expenditures for such
maintenance shall be at the discretion of Landlord.
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6. PARKING Tenant shall have the right to use with other tenants or occupants
of the Complex 96 parking spaces in the common parking areas of the Complex.
Tenant agrees, that Tenant, Tenant's employees, agents, representatives and/or
invitees shall not use parking spaces in excess of said 96 spaces allocated to
Tenant hereunder. Landlord shall have the right, at Landlord's sole discretion,
to specifically designate the location of Tenant's parking spaces within the
common parking areas of the Complex in the event of a dispute among the tenants
occupying the building and/or Complex referred to herein, in which event Tenant
agrees that Tenant, Tenant's employees, agents, representatives and/or invitees
shall not use any parking spaces other than those parking spaces specifically
designated by Landlord for Tenant's use. Said parking spaces, if specifically
designated by Landlord to Tenant, may be relocated by Landlord at any time, and
from time to time. Landlord reserves the right, at Landlord's sole discretion,
to rescind any specific designation of parking spaces, thereby returning
Tenant's parking spaces to the common parking area. Landlord shall give Tenant
written notice of any change in Tenant's parking spaces. Tenant shall not, at
any time, park, or permit the parking of Tenant's trucks or other vehicles
adjacent to the loading areas so as to interfere in any way with the use of such
areas, nor shall Tenant at any time park, or permit the parking of Tenant's
trucks or other vehicles or the trucks and vehicles of Tenant's suppliers or
others, in any portion of the common area not designated by Landlord for such
use by Tenant. Tenant shall not park nor permit to be parked any inoperative
vehicles or equipment on any portion of the common parking area or other common
areas of the Complex. Tenant agrees to assume responsibility for compliance by
its employees with the parking provision contained herein. If Tenant or its
employees park in other than such designated parking areas, then Landlord may
charge Tenant, as an additional charge, and Tenant agrees to pay, ten ($10.00)
Dollars per day for each day or partial day each such vehicle is parked in any
area other than that designated. Tenant hereby authorizes Landlord at Tenant's
sole expense to tow away from the Complex any vehicle belonging to Tenant or
Tenant's employees parked in violation of these provisions, or to attach
violation stickers or notices to such vehicles. Tenant shall use the parking
areas for vehicle parking only, and shall not use the parking areas for storage.
7. EXPENSES OF OPERATION, MANAGEMENT, AND MAINTENANCE OF THE COMMON AREAS OF
THE COMPLEX. As Additional Rent and in accordance with Paragraph 4D of this
Lease, Tenant shall pay to Landlord Tenant's proportionate share (calculated on
a square footage or other equitable basis as calculated by Landlord) of all
expenses of operation, management, maintenance and repair of the Common Areas of
the Complex including, but not limited to, license, permit and inspection fees;
security; utility charges associated with exterior landscaping and lighting
(including water and sewer charges); all charges incurred in the maintenance of
landscaped areas, lakes, parking lots, sidewalks, driveways; maintenance, repair
and replacement of all fixtures and electrical, mechanical, and plumbing
systems; structural elements and exterior surfaces of the buildings; salaries
and employee benefits of personnel and payroll taxes applicable thereto;
supplies, materials, equipment and tools; the amortized cost of capital
expenditures which have the effect of reducing operating expenses, provided,
however, that in the event Landlord makes such capital improvements, Landlord
shall amortize its investment in said improvements over the useful life thereof
(together with interest at the rate of fifteen (15%) percent per annum on the
unamortized balance) as an operating expense in accordance with standard
accounting practices, provided, that such amortization is not at a rate greater
than the reasonably anticipated savings in the operating expenses.
"Additional Rent" as used herein shall not include Landlord's debt
repayments; interest on charges; expenses directly or indirectly incurred by
Landlord for the benefit of any other tenant; cost for the installation of
partitioning or any other tenant improvements; cost of attracting tenants;
depreciation; interest, or executive salaries.
8. ACCEPTANCE AND SURRENDER OF PREMISES Subject to Paragraphs 44, 51 and 53,
and by entry hereunder, Tenant accepts the Premises as being in good and
sanitary order, condition and repair and accepts the building and improvements
included in the Premises in their present condition and without representation
or warranty by Landlord as to the condition of such building or as the use or
occupancy which may be made thereof. Any exceptions to the foregoing must be by
written agreement executed by Landlord and Tenant. Tenant agrees on the last day
of the Lease term, or on the sooner termination of this Lease, to surrender the
Premises promptly and peaceably to Landlord in good condition and repair (damage
by Acts of God, fire, normal wear and tear excepted), with all interior walls
painted, or cleaned so that they appear freshly painted, and repaired and
replaced, if damaged; all floors cleaned and waxed; all carpets cleaned and
shampooed; the air-conditioning and heating equipment serviced by a reputable
and licensed service firm and in good operating condition (providing the
maintenance of such equipment has been Tenant's responsibility to pay for during
the term of the Lease) together with all alterations, additions, and
improvements which may have been made in, to or on the Premises (except movable
trade fixtures installed at the expense of Tenant) except that Tenant shall
ascertain from Landlord within thirty (30) days before the end of the term of
this Lease whether Landlord desires to have the Premises or any part of parts
thereof restored to their condition and configuration as when the Premises were
delivered to Tenant and if Landlord shall so desire, then Tenant shall restore
said Premises or such part or parts thereof before the end of this Lease at
Tenant's sole cost and expense. Tenant, on or before the end of the term of
sooner termination of this Lease, shall remove all of Tenant's personal property
and trade fixtures from the Premises, and all property not so removed on or
before the end of the term or sooner termination of this Lease shall be deemed
abandoned by Tenant and title to same shall thereupon pass to Landlord without
compensation to Tenant. Landlord may, upon termination of this Lease, remove all
movable furniture and equipment so abandoned by Tenant, at Tenant's sole cost,
and repair any damage caused by such removal at Tenant's sole cost. If the
Premises be not surrendered at the end of the term or sooner termination of this
Lease, Tenant shall indemnify Landlord against loss or liability resulting from
the delay by Tenant in so surrendering the Premises including, without
limitation, any claims made by any succeeding tenant found on such delay.
Nothing contained herein shall be construed as an extension of the term thereof
or as a consent of Landlord to any holding over by Tenant. The voluntary or
other surrender of this Lease or the Premises by Tenant or a mutual cancellation
of this Lease shall not work as a merger and at the option of Landlord, shall
either terminate all or any existing subleases or subtenancies or operate as an
assignment to Landlord of any such subleases or subtenancies.
9. ALTERATIONS AND ADDITIONS Tenant shall not make, or suffer to be made, any
alteration or addition to the premises, or any part thereof, without the written
consent of Landlord first had obtained by Tenant, but at the cost of Tenant, and
any addition to, or alteration of, the Premises, except moveable furniture and
trade fixtures, shall at once become a part of the Premises and belong to the
Landlord. Landlord reserves the right to reasonably approve all contractors and
mechanics proposed by Tenant to make such alterations and additions. Tenant
shall retain title to all moveable furniture and trade fixtures placed on the
Premises. All heating, lighting, electrical, air-conditioning floor to ceiling
partitioning, drapery, carpeting, and floor installations made by Tenant,
together with all property that has become an integral part of the Premises,
shall not be deemed trade fixtures. Tenant agrees that it will not proceed to
make such alteration or additions, without having obtained consent from the
Landlord to do so, and until five (5) days from the receipt of such consent, in
order that Landlord may post appropriate notices to avoid any liability to
contractors or material suppliers for payment for Tenant's improvements. Tenant
will at all times permit such notices to be posted and to remain posted until
the completion of work. Tenant shall, if required by Landlord, secure at
Tenants own cost and expense, a completion and lien indemnity bond, satisfactory
to Landlord, for such work. Tenant further covenants and agrees that any
mechanics lien filed against the Premises or against the Complex for work
claimed to have been done for, or materials claimed to have been furnished to
Tenant, will be discharged by Tenant, by bond or otherwise, within ten (10) days
after the filing thereof, at the cost and expense of Tenant. Any exceptions to
the foregoing must be made in writing and executed by both Landlord and Tenant.
10. TENANT MAINTENANCE Tenant shall, at it's sole cost and expense, keep and
maintain the Premises (including appurtenances) and every part thereof in a high
standard of maintenance and repair, and in good and sanitary condition. Tenants
maintenance and repair responsibilities herein referred to include, but are not
limited to, all windows, window frames, plate glass, glazing, truck doors,
plumbing systems (such as water and drain lines, sinks, toilets, faucets,
drains, showers, and water fountains), electrical systems (such as panels,
conduits, outlets, lighting fixtures, lamps bulbs, tubes, ballasts), heating and
air-conditioning systems (such as compressors, fans, air handlers, ducts, mixing
boxes, thermostats, time clocks, boiler, heaters, supply and return grills)
store fronts, roofs, downspouts, all interior improvements within the premises
including but not limited to wall coverings, window coverings, carpet, floor
coverings, partitioning, ceilings, doors (both interior and exterior, including
closing mechanisms, latches, locks, skylights (if any), automatic fire
extinguishing systems, and elevators and all other interior improvements of any
nature whatsoever. Tenant agrees to provide carpet xxxxxxx under all rolling
chairs or to otherwise be responsible for wear and tear of the carpet caused by
such rolling chairs if such wear and tear exceeds that caused by normal foot
traffic in surrounding areas. Areas of excessive wear shall be replaced at
Tenants sole expense upon Lease termination. Tenant hereby waives all rights
under, and benefits of, subsection 1 of Section 1932 and Section 1941 of the
California Civil Code and under any similar law, statute or ordinance now or
hereafter in effect.
11. UTILITIES Tenant shall pay promptly, as the same become due, all charges
for water, gas, electricity, telephone, telex, and other electronic
communications service, sewer service, waste pick-up and any other utilities,
materials or services furnished directly or used by Tenant on or about the
Premises during the term of this Lease, including, without limitation, any
temporary or permanent utility surcharge or other exactions whether or not
hereinafter imposed.
Landlord shall not be liable for and Tenant shall not be entitle to any
abatement or reduction of rent by reason of any interruption or failure of
utility services to the Premises when such interruption or failure is caused by
accident, breakage, repair, strikes, lockouts, or other labor disturbances or
labor disputes of any nature, or by any other cause, similar or dissimilar,
beyond the reasonable control of Landlord.
12. TAXES A. As Additional Rent and in accordance with Paragraph 4 D of this
Lease, Tenant shall pay to Landlord Tenants proportionate share of all Real
Property Taxes, which prorata share shall be allocated to the leased Premises by
square footage or other equitable basis, as calculated by Landlord. The term
"Real Property Taxes", as used herein, shall mean (i) all taxes, assessments,
levies and other charges of any other kind to nature whatsoever, general and
special, foreseen and unforeseen (including all installments of principal and
interest required to pay any general or special assessments for public
improvements and any increases resulting from reassessments caused by
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any change in ownership of the Complex) now or hereafter imposed by any
governmental or quasi-governmental authority or special district having the
direct of indirect power to tax or levy assessments, which are levied or
assessed against, or with respect to the value, occupancy or use of all or any
portion of the Complex (as now constructed or as may at any time hereafter be
constructed, altered or otherwise changed) or Landlord's interest therein; any
improvements located within the Complex (regardless of ownership); the fixtures,
equipment and other property of Landlord, real or personal, that are an integral
part of and located in the Complex; or parking areas, public utilities, or
energy within the Complex; (ii) all charges, levies or fees imposed by reason of
environmental regulation or other governmental control of the Complex and (iii)
all costs and fees (including reasonable attorneys fees) incurred by Landlord in
contesting any Real Property Tax and in negotiating with public authorities as
to any Real Property Tax. If at any time during the term of this Lease the
taxation or assessment of the Complex prevailing as of the commencement date of
this Lease shall be altered so that in lieu of or in addition to any Real
Property Tax described above there shall be levied, assessed or imposed (whether
by reason of a change in the method of taxation or assessment, creation of a new
tax or charge, or any other cause) an alternate or additional tax or charge (i)
on the value, use or occupancy of the Complex or Landlord's interest therein or
(ii) on or measured by the gross receipts, income or rentals from the Complex,
on Landlord's business of leasing the Complex, or computed in any manner with
respect to the operation of the Complex, then any such tax or charge, however
designated, shall be included within the meaning of the term "real Property
Taxes" for purposes of this Lease. If any Real Property Tax is based upon
property or rents unrelated to the Complex, then only that part of such real
Property Tax that is fairly allocable to the Complex shall be included within
the meaning of the term "Real Property Taxes". Notwithstanding the foregoing,
the term "Real Property Taxes" shall not include estate, inheritance, gift or
franchise taxes of Landlord or the federal or state net income tax imposed on
Landlord's income from all sources, or interest charges or other penalties or
fines for Landlord's late payment of Property Taxes, provided Tenant has paid
its Taxes by the due date as stated herein.
B. Taxes on Tenant's Property
(a) Tenant shall be liable for and shall pay ten days before
delinquency, taxes levied against any personal property or trade fixtures placed
by Tenant in or about the Premises. If any such taxes on Tenant's personal
property or trade fixtures are levied against Landlord or Landlord's property or
if the assessed value of the Premises is increased by the inclusion therein of a
value placed upon such personal property or trade fixtures of Tenant and if
Landlord, after written notice to Tenant, pays the taxes based on such increased
assessment, which Landlord shall have the right to do regardless of the validity
thereof, but only under proper protest if requested by Tenant, Tenant shall upon
demand,, as the case may be, repay to Landlord the taxes so levied against
Landlord, or the proportion of such taxes resulting from such increase in the
assessment; provide that in any such event Tenant shall have the right, in the
name of Landlord and with Landlord's full cooperation, to bring suit in any
court of competent jurisdiction to recover the amount of any such taxes so paid
under protest, and any amount so recovered shall belong to Tenant.
(b) if the Tenant improvements in the Premises, whether installed,
and/or paid for by Landlord or Tenant and whether or not affixed to the real
property so as to become a part thereof, are assessed for real property tax
purposes at a valuation higher than the valuation at which standard office
improvements in other space in the Complex are assessed, then the real property
taxes and assessments levied against Landlord or the Complex by reason of such
excess assess valuation shall be deemed to be taxes levied against personal
property of Tenant and shall be governed by the provisions of 12Ba, above. If
the records of the County Assessor are available and sufficiently detailed to
serve as a basis for determining whether said Tenant improvements are assessed
at higher valuation than standard office improvements in other space in the
Complex, such records shall be binding on both the Landlord and the Tenant. If
the records of the County Assessor are not available or sufficiently detailed to
serve as a basis for making said determination, the actual cost of construction
shall be used.
13. LIABILITY INSURANCE Tenant at Tenant's expense, agrees to keep in force
during the term of the Lease a policy of commercial general liability insurance
with combined single limit coverage of not less than Two Million Dollars
($2,000,000) for injuries to or death of persons occurring in, on, or about the
Premises or the Complex, and property damage insurance with limits of $500,000.
The policy or policies affecting such insurance, certificates of insurance of
which shall be furnished to Landlord, shall name Landlord as additional
insureds, and shall insure any liability of Landlord, contingent or otherwise,
as respects acts or omissions of Tenant, its agents, employees or invitees or
otherwise by any conduct or transactions of any of said persons in or about or
concerning the Premises, including any failure of Tenant to observe or perform
any of its obligations hereunder, shall be issued by an insurance company
admitted to transact business in the State of California; and shall provide that
the insurance effected thereby shall not be canceled, expect upon thirty (30)
days prior written notice to Landlord. If during the term of this Lease, in the
considered opinion of Landlord's Lender or insurance advisor, the amount of
insurance described in this paragraph 13 is not adequate. Tenant agrees to
increase said coverage of such reasonable amount as Landlord's Lender, insurance
advisor, or counsel shall deem adequate. Landlord agrees that such adjustments
shall not take place more than one time in any twelve (12) month period
14. TENANT'S PERSONAL PROPERTY INSURANCE AND XXXXXXX'X COMPENSATION INSURANCE
Tenant shall maintain a policy or policies of fire and property damage insurance
in "all risk" form with a sprinkler leakage endorsement insuring the personal
property, inventory, trade fixtures, and leasehold improvements within the
leased Premises for the full replacement value thereof. The proceeds from any of
such policies shall be used for the repair or replacement of such items so
insured. Tenant shall also maintain a policy or policies of xxxxxxx'x
compensation insurance and any other employees benefit insurance sufficient to
comply with all laws.
15. PROPERTY INSURANCE Landlord shall purchase and keep in force and as
Additional Rent and in accordance with Paragraph 4D of Lease, Tenant shall pay
to Landlord (or Landlord's agent if so directed by Landlord) Tenant's
proportionate share (calculated on a square footage or other equitable basis as
calculated by Landlord) of the deductibles on insurance claims and the cost of
policy or policies of insurance covering loss or damage to the Premises and
Complex in the amount of the full replacement value thereof, providing
protection against those perils included within the classification of "all
risks" insurance and flood and/or earthquake insurance, if available, plus a
policy of rental income insurance in the amount of one hundred (100%) percent of
twelve (12) months Basic Rent, plus sums paid as Additional Rent and any
deductibles related thereto. If such insurance cost is increased solely due to
Tenant's use of the Premises of the Complex, Tenant agrees to pay to Landlord
the full cost of such increase or its pro rata share if the increase results
from two or more tenants' uses. Tenant shall have no interest in nor any right
to the proceeds of any insurance procured by Landlord for the Complex. Any other
provision of this Lease to the contrary notwithstanding, Landlord and Tenant do
each hereby respectively release the other, to the extent of the insurance
coverage of the releasing party, from any liability for loss of damage caused by
fire or any of the extended coverage casualties included in the releasing
party's insurance policies, irrespective of the cause of such fire or casualty;
provided, however, that if the insurance policy of either releasing party
prohibits such waiver, then this waiver shall not take effect until consent to
such waiver is obtained. If such waiver is so prohibited, the insured party
affected shall promptly notify the other party thereof.
16. INDEMNIFICATION Landlord shall not be liable to Tenant and Tenant hereby
waives all claims against Landlord for any injury to or death of any person or
damage to or destruction of property in or about the Premises or the Complex by
or from any cause whatsoever, including, without limitation, gas, fire, oil,
electricity or leakage of any character from the roof, walls, basement or other
portion of the Premises or the Complex but excluding, however, the willful
misconduct or negligence of Landlord, its agents, servants, employees, invitees,
or contractors of which negligence Landlord has knowledge and reasonable time to
correct. Except as to injury to persons or damage to property to the extent
arising from the willful misconduct or the negligence of Landlord its agents,
servants, employees, invitees, or contractors. Tenant shall hold Landlord
harmless from and defend Landlord against any and all expenses, including
reasonable attorney's fees, in connection therewith, arising out of any injury
to or death of any person or damage to or destruction of property occurring in,
on, or about the Premises, or any part thereof, from any cause whatsoever.
17. COMPLIANCE Tenant, at its sole cost and expense, shall promptly comply with
all laws, statutes, ordinances and governmental rules, regulations or
requirements not or hereafter in effect; with the requirements of any board of
fire underwriters or other similar body now or hereafter constituted; and with
an direction or occupancy certificate issued pursuant to law by any public
officer; provided, however, that no such failure shall be deemed a breach of the
provisions if Tenant, immediately upon notification commences to remedy or
rectify said failure. The judgment of any court of competent jurisdiction or the
admission of Tenant in any action against Tenant, whether Landlord be a party
thereto or not, that tenant has violated any such law, statute, ordinance or any
governmental role, regulation, requirement direction or provision, shall be
conclusive of that fact as between Landlord and Tenant. This paragraph shall not
be interpreted as requiring Tenant to make structural changes or improvements,
except to the extent such changes or improvements are required as a result of
Tenants particular use of the Premises. Tenant shall at its sole cost and
expense, comply with any and all requirements pertaining to said Premises, of
any insurance organization or company, necessary for the maintenance of
reasonable fire and public liability insurance covering the Premises. See
Paragraph 53.
18. LIENS Tenant shall keep the Premises and the Complex free from any liens
arising out of any work performed, material furnished or obligation incurred by
Tenant. In the event that Tenant shall not, with ten (10) days following the
imposition of such lien, cause the same to be released of record, Landlord shall
have, in addition to all other remedies provided herein and by law, the right,
but no obligation. To cause the same to be released by such means as it shall
deem proper, including payment of the claim giving rise to such lien. All sums
paid by Landlord for such purpose, and all expenses incurred by it in connection
therewith shall be payable to Landlord by Tenant on demand with interest at the
prime rate of interest as quoted by the Bank of America.
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19. ASSIGNMENT AND SUBLETTING
See Paragraph 49
20. SUBORDINATION AND MORTGAGES In the event Landlord's title or leasehold
interest is now or hereafter encumbered by a deed of trust, upon the interest of
Landlord in the land and buildings in which the demised Premises are located, to
secure a loan from a lender (hereinafter referred to as "lender") to Landlord,
Tenant shall, at the request of Landlord or Lender, execute in writing an
agreement subordinating its rights under this Lease to the lien of such deed of
trust, or, if so requested agreeing that the lien of Lender's deed of trust
shall be or remain subject and subordinate to the rights of Tenant under this
Lease. Notwithstanding any such subordination, Tenant's possession under this
Lease shall not be disturbed if Tenant is not in default and so long as Tenant
shall pay all rent and observe and perform all of the provisions set forth in
this Lease.
See Xxxxxxxxx 00
00. ENTRY BY LANDLORD Landlord reserves, and shall at all reasonable times
after at least 24 hours notice (except in emergencies) have, the right to enter
the Premises to inspect them; to perform any services to be provided by Landlord
hereunder; to submit the Premises to prospective purchasers, mortgagers or
(during the last eighteen (18) months of the Term of this Lease) tenants; to
post notices of nonresponsibility; and to alter, improve or repair the Premises
and any portion of the Complex, all without abatement of rent; and may erect
scaffolding and other necessary structures in or through the Premises where
reasonably required by the character of the work to be performed; provided,
however that the business of Tenant shall be interfered with to the least extent
that is reasonably practical. For each of the foregoing purposes, Landlord shall
at all times have and retain a key with which to unlock all of the doors in an
emergency in order to obtain entry to the Premises, and any entry to the
Premises obtained by Landlord by any of said means, or otherwise, shall not
under any circumstance be construed or deemed to be a forcible or unlawful entry
into or a detainer of the Premises or an eviction, actual or constructive, of
Tenant from the Premises or any portion thereof. Landlord shall also have the
right at any time to change the arrangement or location of entrances or
passageways, doors and doorways, and corridors, elevators, stairs, toilets or
other public parts of the Complex and to change the name, number or designation
by which the Complex is commonly known, and none of the foregoing shall be
deemed an actual or constructive eviction of Tenant, or shall entitle Tenant to
any reduction of rent hereunder. See Xxxxxxxxx 00
00. BANKRUPTCY AND DEFAULT The commencement of a bankruptcy action or
liquidation action or reorganization action or insolvency action or an
assignment of or by Tenant for the benefit of creditors, or any similar action
undertaken by Tenant, or the insolvency of Tenant, shall, at Landlord's option
constitute a breach of this Lease by Tenant. If the trustee or receiver
appointed to serve during a bankruptcy, liquidation, reorganization, insolvency
or similar action elects to reject Tenant's unexpired Lease, the trustee or
receiver shall notify Landlord in writing of its election within thirty (30)
days after an order for relief in a liquidation action or within thirty (30)
days after the commencement of any action.
Within thirty (30) days after court approval of the assumption of this
Lease, the trustee or receiver shall cure (or provide adequate assurance to the
reasonable satisfaction of Landlord that the trustee or receiver shall cure) and
all previous defaults under the unexpired Lease and shall compensate Landlord
for all actual pecuniary loss and shall provide adequate assurance of future
performance under said Lease to the reasonable satisfaction of Landlord.
Adequate assurance of future performance, as used herein, includes, but shall
not be limited to: (i) assurance of source and payment of rent, and other
consideration due under this Lease; (ii) assurance that the assumption or
assignment of this Lease will not breach substantially any provision, such as
radius, location, use, or exclusivity provision, in any agreement relating to
the above described Premises.
Nothing contained in this section shall affect the existing right of
Landlord to refuse to accept an assignment upon commencement f or in connection
with a bankruptcy, liquidation, reorganization or insolvency action or an
assignment of Tenant for the benefit of creditors or other similar act. Nothing
contained in this Lease shall be construed as giving or granting or creating an
equity in the demised Premises to Tenant. In no event shall the leasehold estate
under this Lease or any interest therein, be assigned by voluntary or
involuntary bankruptcy proceeding without the prior written consent of Landlord.
In no event shall this Lease or any rights or privileges hereunder be an asset
of Tenant under any bankruptcy, insolvency or reorganization proceedings.
The failure to perform or honor any covenant, condition or representation
made under this Lease shall constitute a default hereunder by Tenant upon
expiration of the appropriate grace period hereinafter provided. Tenant shall
have a period of five (5) days from the date of written notice within which to
cure any default in the payment of rental or adjustment thereto. Tenant shall
have a period of thirty (30) days from the date of the written notice from
Landlord within which to cure any other default under this Lease; provided,
however, that if the nature of Tenant's failure is such that more than thirty
(30) days is reasonably required to cure the same, Tenant shall not be in
default so long as Tenant commences performance within such thirty (30) day
period and thereafter prosecutes the same to completion. Upon an uncured default
of this Lease by Tenant, Landlord shall have the following rights and remedies
in addition to any other rights or remedies available to Landlord at law or in
equity.
(a). The rights and remedies provided for by California Civil Code Section
1951.2, including but not limited to, recovery of the worth at the time of award
of the amount by which the unpaid rent for the balance of the term after the
time of award exceeds the amount of rental loss for the same period that Tenant
proves could be reasonably avoided, as computed pursuant to subsection (b) of
said Section 1951.2. Any proof by Tenant under subparagraphs (2) and (3) of
Section 1951.2 of the California Civil Code of the amount of rental loss that
could be reasonably avoided shall be made in the following manner: Landlord and
Tenant shall each select a licensed real estate broker in the business of
renting property of the same type and use as the Premises and in the same
geographic vicinity. Such two real estate brokers shall select a third licensed
real estate broker, and the three licensed real estate brokers so selected shall
determine the amount of the rental loss that could be reasonably avoided from
the balance of the term of this Lease after the time of award. The decision of
the majority of said licensed real estate brokers shall be final and binding
upon the parties hereto.
(b) The rights and remedies provided by California Civil Code Section
which allows Landlord to continue the Lease in effect and to enforce all of its
rights and remedies under this Lease, including the right to recover rent as it
becomes due, for so long as Landlord does not terminate Tenant's right to
possession; acts of maintenance or preservation, efforts to relet the Premises,
or the appointment of a receiver upon Landlord's initiative to protect its
interest under this Lease shall not constitute a termination of Tenant's right
to possession.
(c) The right to terminate this Lease by giving notice to Tenant in
accordance with applicable law.
(d) The right and power; to the extent permitted by law to enter the
Premises and remove all persons and property, to store such property in a public
warehouse or elsewhere at the cost of and for the account of Tenant and to sell
such property and apply such proceeds therefrom pursuant to applicable
California law. Landlord may from time to time sublet the Premises or any part
thereof for such term or terms (which may extend beyond the term of this Lease)
and at such rent and such other terms as Landlord in its sole discretion may
deem advisable, with the right to make alterations and repairs to the Premises.
Upon each subletting, (i) Tenant shall be immediately liable to pay Landlord, in
addition to indebtedness other that rent due hereunder, the cost of such
subletting, including, but not limited to, reasonable attorney's fees, and any
real estate commissions actually paid, and the costs of such alterations and
repairs incurred by Landlord and the amount, if any, by which the rent hereunder
for the period of such subletting (to the extent such period does not exceed the
term hereof) exceeds the amount to be paid as rent for the Premises for such
period or (ii) at the options of Landlord, rents received from such subletting
shall be applied first to payment of indebtedness other than rent due hereunder
from Tenant to Landlord; second, to the payment of any costs of such alterations
and repairs; third to payment of rent due and unpaid hereunder; and the residue,
if any, shall be held by Landlord and applied in payment of future rent as the
same becomes due hereunder. If Tenant has been credited from such subletting
under option (ii) during any months be less than that to be paid during that
month by Tenant hereunder, Tenant shall pay any such deficiency to Landlord.
Such deficiency shall be calculated and paid monthly. No taking possession of
the Premises by Landlord, shall be construed as an election on its part to
terminate this Lease unless a written notice of such
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intention be given to Tenant. Notwithstanding any such subletting without
termination. Landlord may at any time hereafter elect to terminate this Lease
for such previous breach.
(e). The right to have a receiver appointed for Tenant upon application by
Landlord, to take possession of the Premises and to apply any rental collected
from the Premises and to exercise all other rights and remedies granted to
Landlord pursuant to subparagraph d, above.
23. ABANDONMENT Tenant shall not vacate or abandon the Premises at any time
during the term of this Lease (except that Tenant may vacate so long as it pays
rent, provides an on-site security guard during normal business hours from
Monday through Friday, and otherwise performs its obligations hereunder) and if
Tenant shall abandon, vacate or surrender said Premises, or be dispossessed by
the process of law, or otherwise, any personal property belonging to Tenant and
left on the Premises shall be deemed to be abandoned, at the option of Landlord,
except such property as may be mortgaged to Landlord.
24. DESTRUCTION In the event the Premises are destroyed in whole or in part
from any cause, except for routine maintenance and repairs and incidental damage
and destruction caused from vandalism and accidents for which Tenant is
responsible for under Xxxxxxxxx 00, Xxxxxxxx may, at its option:
(a) Rebuild or restore the Premises to their condition prior to the damage
or destruction, or
(b) Terminate this Lease. (providing that the Premises is damaged to the
extent of 33 1/3% of the replacement cost)
If Landlord does not give Tenant notice in writing within thirty (30) days
from the destruction of the Premises of its election to either rebuild and
restore them and the estimated time required to rebuild or restore or to
terminate this Lease, Landlord shall be deemed to have elected to rebuild or
restore them, in which event Landlord agrees, at its expense, promptly to
rebuild or restore the Premises to their condition prior to the damage or
destruction. Tenant shall be entitled to a reduction in rent while such repair
is being made in the proportion that the area of the Premises rendered
untenantable by such damage bears to the total area of the Premises. If Landlord
initially estimates that the rebuilding or restoration will exceed 180 days or
if Landlord does not complete the rebuilding or restoration within on hundred
eighty (180) days following the date of destruction (such period of time to be
extended for delays caused by the fault or neglect of Tenant or because of Acts
of God, acts of public agencies, labor disputes, strikes, fires, freight
embargoes, rainy or stormy weather, inability to obtain materials, supplies or
fuels, acts of contractors or subcontractors or delay of the contractors or
subcontractors due to such causes or other contingencies beyond the control of
Landlord), then Tenant shall have the right to terminate this Lease by giving
fifteen (15) days prior written notice to Landlord. Notwithstanding anything
herein to the contrary, Landlord's obligation to rebuild or restore shall be
limited to the building and interior improvements constructed by Landlord as
they existed as of the commencement date of the Lease and shall not include
restoration of Tenant's trade fixtures, equipment, merchandise, or any
improvements, alterations or additions made by Tenant to the Premises, which
Tenant shall forthwith replace or fully repair at Tenant's sole cost and expense
provided this Lease is not cancelled according to the provisions above.
Unless this Lease is terminated pursuant to the foregoing provisions, this
Lease shall remain in full force and effect. Tenant hereby expressly waives the
provisions Section 1932, Subdivision 2, in Section 1933, Subdivision 4 of the
California Civil Code.
In the event that the building in which the Premises are situated is
damaged or destroyed to the extent of not less than 131/3% of the replacement
cost thereof, Landlord may elect to terminate this Lease, whether the Premises
be injured or not.
25. EMINENT DOMAIN If all or any part of the Premises shall be taken by any
public or quasi-public authority under the power of eminent domain or conveyance
in lieu thereof, this Lease shall terminate as to any portion of the Premises so
taken or conveyed on the date when title vests in the condemnor, and Landlord
shall be entitled to any and all payment, income, rent, award, or any interest
therein whatsoever which may be paid or made in connection with such taking or
conveyance, and Tenant shall have no claim against Landlord or otherwise for the
value of any unexpired term of this Lease. Notwithstanding the foregoing
paragraph, any compensation specifically awarded Tenant for loss of business,
Tenant's personal property, moving cost or loss of good will, shall be and
remain the property of Tenant.
If (i) any action or proceeding is commenced for such taking of the
Premises or any part thereof, or if Landlord is advised in writing by any entity
or body having the right or power of condemnation of its intention to condemn
the premises or any portion thereof, or (ii) any of the foregoing events occur
with respect to the taking of any space in the Complex not leased hereby, or if
any such spaces so taken or conveyed in lieu of such taking and Landlord shall
decide to discontinue the use and operation of the Complex, or decide to
demolish, alter or rebuild the Complex, then, in any of such events Landlord
shall have the right to terminate this Lease by giving Tenant written notice
thereof within sixty (60) days of the date of receipt of said written advice, or
commencement of said action or proceeding, or taking conveyance, which
termination shall take place as of the first to occur of the last day of the
calendar month next following the month in which such notice is given or the
date on which title to the Premises shall vest in the condemnor.
In the event of such a partial taking or conveyance of the Premises, if the
portion of the Premises taken or conveyed is so substantial that the Tenant can
no longer reasonably conduct its business, Tenant shall have the privilege of
terminating this Lease within sixty (60) days from the date of such taking or
conveyance, upon written notice to Landlord of its intention so to do, and upon
giving of such notice this Lease shall terminate on the last day of the calendar
month next following the month in which such notice is given, upon payment by
Tenant of the rent from the date of such taking or conveyance to the date of
termination.
If a portion of the Premises be taken by condemnation or conveyance in lieu
thereof and neither Landlord nor Tenant shall terminate this Lease as provided
herein, this Lease shall continue in full force and effect as to the part of the
Premises not so taken or conveyed, and the rent herein shall be apportioned as
of the date of such taking or conveyance so that thereafter the rent to be paid
by Tenant shall be in the ratio that the area of the portion of the Premises not
so taken or conveyed bears to the total area of the Premises prior to such
taking.
26. SALE OR CONVEYANCE BY LANDLORD In the event of a sale or conveyance of the
Complex or any interest therein, by any owner of the reversion then constituting
Landlord, the transferor shall thereby be released from any further liability
upon any of the terms, covenants or conditions (express or implied) herein
contained in favor of Tenant, and in such event, insofar as such transfer is
concerned, Tenant agrees to look solely to the responsibility of the successor
in interest of such transferor in and to the Complex and this Lease. This Lease
shall not be affected by any such sale or conveyance, and Tenant agrees to
attorn to the successor in interest of such transferor.
See Xxxxxxxxx 00
00. ATTORNMENT TO LENDER OR THIRD PARTY In the event the interest of Landlord
in the land and buildings in which the leased Premises are located (whether such
interest of Landlord is a fee title interest or a leasehold interest) is
encumbered by deed of trust, and such interest is acquired by the lender or any
third party through judicial foreclosure or by exercise of a power of sale at
private trustee's foreclosure sale, Tenant hereby agrees to attorn to the
purchaser at any such foreclosure sale and to recognize such purchaser as the
Landlord under this Lease. In the event the lien of the deed of trust securing
the loan from a Lender to Landlord is prior and paramount to the Lease, this
Lease shall nonetheless continue in full force and effect for the remainder of
the unexpired term hereof, at the same rental herein reserved and upon all the
other terms, conditions and covenants herein contained.
28. HOLDING OVER Any holding over by Tenant after expiration or other
termination of the term of this Lease with the written consent of Landlord
delivered to Tenant shall not constitute a renewal or extension of the Lease or
give Tenant any rights in or to the leased Premises except as expressly provided
in this Lease. Any holding over after the expiration or other termination of the
term of this Lease, with the consent of Landlord, shall be construed to be a
tenancy from month to month, on the same terms and conditions herein specified
insofar as applicable except that the monthly Basic Rent shall be increased to
an amount equal to one hundred fifty (150%) percent of the monthly Basic Rent
required during the last month of the Lease term.
29. CERTIFICATE OF ESTOPPEL Either party shall at any time upon not less than
ten (10) days prior written notice from the other party execute, acknowledge and
deliver to the requesting party a statement in writing (i) certifying that this
Lease is unmodified and in full force and effect (or, if modified, stating the
nature of such modification and certifying that this Lease, as so modified, is
in full force and effect) and the date to which the rent and other charges are
paid in advance, if any, and (ii) acknowledging that there are not, to the best
of such party's knowledge, any uncured defaults on the part of the other party
hereunder, or specifying such defaults, if any, are claimed. Any such statement
may be conclusively relied upon by any prospective purchaser or encumbrancer of
the Premises. A party's failure to delivery such statement within such time
shall be conclusive upon the party receiving such request that this lease is in
full force and effect, without modification except as may be represented by
Landlord; that there are no uncured defaults in the requesting party's
performance, and that not more than one month's rent has been paid in advance.
30. CONSTRUCTION CHANGES It is understood that the description of the Premises
and the location of ductwork, plumbing and other facilities therein are subject
to such minor changes as Landlord or Landlord's architect determines to be
desirable in the course of construction of the Premises, and no such changes, or
any changes in plans for any other portions of the Complex shall affect this
Lease or entitle Tenant to any reduction of rent hereunder or result in any
liability of Landlord to Tenant. Landlord does not guarantee the accuracy of any
drawings supplied to Tenant and verification of the accuracy of such drawings
rests with Tenant.
31. RIGHT OF LANDLORD TO PERFORM All terms, covenants and conditions of this
Lease to be performed or observed by Tenant shall be performed or observed by
Tenant at Tenant's sole cost and expense and without any reduction of rent. If
Tenant shall fail to pay any sum of money, or other rent, required to be paid by
it hereunder of shall fail to perform any other term or covenant hereunder on
its part to be performed, and such failure shall continue for five (5) days
after written notice thereof by Landlord. Landlord, without waiving or releasing
Tenant from any obligations of Tenant hereunder, may, but shall not be obligated
to, make any such payment or perform
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any such other term or covenant on Tenant's part to be performed. All sums so
paid by Landlord and all necessary costs of such performance by Landlord
together with interest thereon at the rate of the prime rate of Interest per
annum as quoted by the Bank of America from the date of such payment or
performance by Landlord, shall be paid (and Tenant covenants to make such
payment) to Landlord on demand by Landlord, and Landlord shall have (in addition
to any other right or remedy of Landlord) the same rights and remedies in the
event of nonpayment by Tenant in the case of failure by Tenant in the payment of
rent hereunder.
32. ATTORNEY'S FEES.
(A) In the event that either Landlord or Tenant should bring suit for the
possession of the Premises, for the recovery of any sum due under this Lease, or
because of the breach of any provision of this Lease, or for any other relief
against the other party hereunder, then all costs and expenses, including
reasonable attorneys' fees, incurred by the prevailing party therein shall be
paid by the other party, which obligation on the part of the other party shall
be deemed to have accrued on the date of the commencement of such action and
shall be enforceable whether or not the action is prosecuted to judgement.
(B) Should Landlord be named as a defendant in any suit brought against
Tenant in connection with or arising out of Tenant's occupancy hereunder, Tenant
shall pay to Landlord its costs and expenses incurred in such suit, including a
reasonable attorney's fee.
33. WAIVER The waiver by either party of the other party's failure to perform
or observe any term, covenant or condition herein contained to be performed or
observed by such waiving party shall not be deemed to be a waiver of such term,
covenant or condition or of any subsequent failure of the party failing to
perform or observe the same or any other such term, covenant or condition
therein contained, and no custom or practice which may develop between the
parties hereto during the term hereof shall be deemed a waiver of, or in any way
affect, the right of either party to insist upon performance and observance by
the other party in strict accordance with the terms hereof.
34. NOTICES All notices, demands, requests, advices or designations which may
be or are required to be given by either party to the other hereunder shall be
in writing. All notices, demands, requests, advices or designations by Landlord
to Tenant shall be sufficiently given, made or delivered if personally served on
Tenant by leaving the same at the Premises or if sent by United States certified
or registered mail, postage prepaid, addressed to Tenant at the Premises. All
notices demands, requests, advices or designations by Tenant to Landlord shall
be sent by the United States certified or registered mail, postage prepaid,
addressed to Landlord at its offices at Xxxxx/Xxxxxxxxx, 2560 Mission College
-------------------------------------
Xxxx., Xxxxx 000, Xxxxx Xxxxx, XX 00000. Each notice, request, demand, advice
---------------------------------------
or designation referred to in this paragraph shall be deemed received on the
date of the personal service or the date of actual receipt or refusal of
delivery, as the case may be.
35. EXAMINATION OF LEASE Submission of this instrument for examination or
signature by Tenant does not constitute a reservation of or option for a lease,
and this instrument is not effective as a lease or otherwise until its execution
and delivery by both Landlord and Tenant.
36. DEFAULT BY LANDLORD Landlord shall not be in default unless Landlord fails
to perform obligations required of Landlord within a reasonable time, but in no
event earlier than thirty (30) days after written notice by Tenant to Landlord
and to the holder of any first mortgage or deed of trust covering the Premises
whose name and address shall have heretofore been furnished to Tenant in
writing, specifying wherein Landlord has failed to perform such obligations;
provided, however, that if the nature of Landlord's obligations is such that
more than thirty (30) days are required for performance, then Landlord shall not
be in default if Landlord commences performance within such thirty (30) day
period and thereafter diligently prosecutes the same to completion.
37. CORPORATE AUTHORITY If Tenant is a corporation, (or a partnership) each
individual executing this Lease on behalf of said corporation (or partnership)
represents and warrants that he is duly authorized to execute and deliver this
Lease on behalf of said corporation (or partnership) in accordance with the by-
laws of said corporation (or partnership in accordance with the partnership
agreement) and that this Lease is binding upon said corporation (or partnership)
in accordance with its terms. If Tenant is a corporation, Tenant shall, within
(30)days after execution of the Lease, deliver to Landlord a certified copy of
the resolution of the Board of Directors of said corporation authorizing or
ratifying the execution of this Lease.
39. LIMITATION OF LIABILITY In consideration of the benefits accruing
hereunder, Tenant and all successors and assigns covenant and agree that, in the
event of any actual or alleged failure, breach or default hereunder by Landlord:
(i) the sole and exclusive remedy shall be against Landlord' interest in
the Premises leased herein;
(ii) no partner of Landlord shall be sued or named as party in any suit
or action (except as may be necessary to secure jurisdiction of the
partnership)
(iii) no service of process shall be made against any partner of Landlord
(except as may be necessary to secure jurisdiction of the
partnership)
(iv) no partner of Landlord shall be required to answer or otherwise
plead to any service of process:
(v) no judgement will be taken against any partner of Landlord;
(vi) any judgement taken against any partner of Landlord may be vacated
and set aside at any time without hearing:
(vii) no writ of execution will ever be levied against the assets of any
partner of Landlord;
(viii) these covenants and agreements are enforceable both by Landlord and
also by any partner of Landlord.
Tenant agrees that each of the foregoing covenants and agreements shall be
applicable to any covenant or agreement either expressly contained in this Lease
or imposed by statute or at common law.
40. MISCELLANEOUS AND GENERAL PROVISIONS
a. Tenant shall not, without the written consent of Landlord, use the
name of the building for any purpose other than as the address of the
business conducted by Tenant in the Premises.
b. This Lease shall in all respects be governed by and construed in
accordance with the laws of the State of California. If any provision of
this Lease shall be invalid, unenforceable or ineffective for any reason
whatsoever, all other provisions hereof shall be and remain in full force
and effect.
c. The term "Premises" includes the space leased hereby and any
improvements now or hereafter installed therein or attached thereto. The
term "Landlord" or any pronoun used in place thereof includes the plural as
well as the singular and the successors and assigns of Landlord. The term
"Tenant" or any pronoun used in place thereof includes the plural as well
as the singular and individuals, firms, associations, partnerships and
corporations, and their and each of their respective heirs, executors,
administrators, successors and permitted assigns, according to the context
hereof, and the provisions of this Lease shall inure to the benefit of and
bind such heirs, executors, administrators, successors and permitted
assigns.
d. Time is of the essence of this Lease and of each and all of its
provisions.
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e. At the expiration or earlier termination of this Lease, Tenant shall
execute, acknowledge and deliver to Landlord, within ten (10) days after
written demand from Landlord to Tenant, any quitclaim deed or other
document required by any reputable title company, licensed to operate in
the State of California, to remove the cloud or encumbrance created by this
Lease from the real property of which Tenant's Premises are a part.
f. This instrument along with any exhibits and attachments hereto
constitutes the entire agreement between Landlord and Tenant relative to
the Premises and this agreement and the exhibits and attachments may be
altered, amended or revoked only by an instrument in writing signed by both
Landlord and Tenant. Landlord and Tenant agree hereby that all prior or
contemporaneous oral agreements between and among themselves and their
agents or representatives relative to the leasing of the Premises are
merged in or revoked by this agreement.
g. Neither Landlord nor Tenant shall record this Lease or a short form
memorandum hereof without the consent of the other.
h. Tenant further agrees to execute any amendments required by a lender
to enable Landlord to obtain financing, so long as Tenant's rights
hereunder are not substantially affected.
i. Paragraphs 43 through 60 are added hereto and are included as a part
-- --
of this Lease.
j. Clauses, plats and riders, if any, signed by Landlord and Tenant and
endorsed on or affixed to this Lease are a part hereof.
k. Tenant covenants and agrees that no diminution or shutting off of
light, air or view by any structure which may be hereafter erected (whether
or not by Landlord) shall in any way affect his Lease, entitle Tenant to
any reduction of rent hereunder or result in any liability of Landlord or
Tenant.
41. BROKERS Tenant warrants that it had dealings with only the following real
estate brokers or agents in connection with the negotiation of this Lease: none
----
and that it knows of no other real estate broker or agent who is entitled to a
commission in connection with this Lease.
42. SIGNS No sign, placard, picture, advertisement, name or notice shall be
inscribed, displayed or printed or affixed on or to any part of the outside of
the Premises or any exterior windows of the Premises without the written consent
of Landlord first had and obtained (such consent not be unreasonably withheld)
and Landlord shall have the right to remove any such sign, placard, picture,
advertisement, name or notice without notice to and at the expense of Tenant. If
Tenant is allowed to print or affix or in any way place a sign in, on or about
the Premises, upon expiration or other sooner termination of this Lease, Tenant
at Tenant's sole cost and expense shall both remove such sign and repair all
damage in such a manner as to restore all aspects of the appearance of the
Premises to the condition prior to the placement of said sign.
All approved signs or lettering on outside doors shall be printed, painted,
affixed or inscribed at the expense of Tenant by a person approved of by
Landlord.
Tenant shall not place anything or allow anything to be placed near the
glass of any window, door partition or wall which may appear unsightly from
outside the Premises. During the Term of this Lease in which Tenant is the sole
occupant of said Premises, Tenant shall be entitled to use the entire monument
sign designated for said building.
IN WITNESS WHEREOF, Landlord and Tenant have executed and delivered this
Lease as of the day and year last written below.
LANDLORD: TENANT:
ARRILLAGA FAMILY TRUST THE VANTIVE CORPORATION
a California Corporation
By /s/ Xxxx Xxxxxxxxx By /s/ Xxxxxxx Xxx
---------------------------------- -----------------------------------
Xxxx Xxxxxxxxx, Trustee Xxxxxxx Xxx, Director of Finance
Date: 12/02/96 Date: 28-OCT-96
------------------------------- --------------------------------
XXXXXXX X. XXXXX SEPARATE PROPERTY TRUST
By /s/ Xxxxxxx X. Xxxxx
----------------------------------
Xxxxxxx X. Xxxxx, Trustee
Date:_______________________________
page 8 of 8
Paragraphs 43 through 60 to Lease Agreement Dated September 4, 1996, By and
Between the Arrillaga Family Trust and the Xxxxxxx X. Xxxxx Separate Property
Trust, as Landlord, and The VANTIVE CORPORATION, a California corporation, as
Tenant for 24,000+ Square Feet of Space Located at 0000 Xxxxxxxx Xxxxx, Xxxxx
Xxxxx, Xxxxxxxxxx.
43. BASIC RENT: In accordance with Paragraph 4A herein, the total aggregate sum
----------
of FOUR MILLION THIRTY TWO THOUSAND AND NO/100 DOLLARS ($4,032,000.00), shall be
payable as follows:
On January 1, 1997, the sum of FORTY FOUR THOUSAND FOUR HUNDRED AND NO/100
DOLLARS ($44,400.00) shall be due, and a like sum due on the first day of each
month thereafter, through and including December 1, 1997.
On January 1, 1998, the sun of FORTY FIVE THOUSAND SIX HUNDRED AND NO/100
DOLLARS ($45,600.00) shall be due, and a like sum due on the first day of each
month thereafter, through and including December 1, 1998.
On January 1, 1999, the sum of FORTY SIX THOUSAND EIGHT HUNDRED AND NO/100
DOLLARS ($46,800.00) shall be due, and a like sum due on the first day of each
month thereafter, through and including December 1, 1999.
On January 1, 2000, the sum of FORTY EIGHT THOUSAND AND NO/100 DOLLARS
($48,000.00) shall be due, and a like sum due on the first day of each month
thereafter, through and including December 1, 2000.
On January 1,2001, the sum of FORTY NINE THOUSAND TWO HUNDRED AND NO/100
DOLLARS ($49,200.00) shall be due, and a like sum due on the first day of each
month thereafter, through and including December 1,2001.
On January 1, 2002, the sum of FIFTY THOUSAND FOUR HUNDRED AND NO/100
DOLLARS ($50,400.00) shall be due, and a like sum due on the first day of each
month thereafter, through and including December 1, 2002.
On January 1, 2003, the sum of FIFTY ONE THOUSAND SIX HUNDRED AND NO/100
DOLLARS (.$51,600.00) shall be due, and a like sum due on the first day of each
month thereafter, through and including December 1, 2003; or until the entire
aggregate sum of FOUR MILLION THIRTY TWO THOUSAND AND NO/100 DOLLARS
($4,032,000.00) has been paid.
44. "AS-IS" BASIS: Subject only to Paragraphs 51, 52, 53 and 55, it is hereby
-------------
agreed that the Premises leased hereunder is leased strictly on an "as-is" basis
and in its present condition, and in the configuration as shown on Exhibit B
---------
attached hereto, and by reference made a part hereof. Except as specifically
noted herein, it is specifically agreed between the parties that Landlord shall
not be required to make, nor be responsible for any cost, in connection with any
repair, restoration, and/or improvement to the Premises in order for this Lease
to commence, or thereafter, throughout the Term of this Lease. Landlord makes no
warranty or representation of any kind or nature whatsoever as to the condition
or repair of the Premises, nor as to the use or occupancy which may be made
thereof.
45. CONSENT. Whenever the consent of one party to the other is required
-------
hereunder, such consent shall not be unreasonably withheld.
46. CHOICE OF LAW: SEVERABILITY. This Lease shall in all respects be governed
---------------------------
by and construed in accordance with the laws of the State of California. If any
provisions of this Lease shall be invalid, unenforceable, or ineffective for any
reason whatsoever, all other provisions hereof shall be and remain in full force
and effect.
47. AUTHORITY TO EXECUTE. The parties executing this Lease Agreement hereby
----------------------
warrant and represent that they are properly authorized to execute this Lease
Agreement and bind the parties on behalf of whom they execute this Lease
Agreement and to all of the terms, covenants and conditions of this Lease
Agreement as they relate to the respective parties hereto.
Page 9 Initial: [ILLEGIBLE]
48. ASSESSMENT CREDITS: The demised property herein may be subject to a
------------------
special assessment levied by the City of Santa Xxxxx as part of an Improvement
District. As a part of said special assessment proceedings (if any), additional
bonds were or may be sold and assessments were or may be levied to provide for
construction contingencies and reserve funds. Interest shall be earned on such
funds created for contingencies and on reserve funds which will be credited for
the benefit of said assessment district. To the extent surpluses are created in
said district through unused contingency funds, interest earnings or reserve
funds, such surpluses shall be deemed the property of Landlord. Notwithstanding
that such surpluses may be credited on assessments otherwise due against the
Leased Premises, Tenant shall pay to Landlord, as additional rent if, and at
the time of any such credit of surpluses, an amount equal to all such surpluses
so credited. For example: if (i) the property is subject to an annual assessment
of $1,000.00, and (ii) a surplus of $200.00 is credited towards the current
year's assessment which reduces the assessment amount shown on the property tax
xxxx from $1,000.00 to $800.00, Tenant shall, upon receipt of notice from
Landlord, pay to Landlord said $200.00 credit as Additional Rent.
49. ASSIGNMENT AND SUBLETTING:
-------------------------
A. Subject to Paragraph 49B below, Tenant shall not assign, transfer, or
hypothecate the leasehold estate under this Lease, or any interest therein, and
shall not sublet the Premises, or any part thereof, or any right or privilege
appurtenant thereto, or suffer any other person or entity to occupy or use the
Premises, or any portion thereof, without, in each case, the prior written
consent of Landlord which consent shall not be unreasonably withheld. As a
condition for granting this consent to any assignment, transfer, subletting or
sub-subletting, Landlord may require that Tenant agrees to pay to Landlord, as
Additional Rent, fifty percent (50%) of all rents or additional consideration
(net of reasonable third party broker fees) received by Tenant from its
assignees, transferees, subtenants, and/or sub-subtenants (if any, which in any
and all cases require the written approval of Landlord) in excess of the rent
payable by Tenant to Landlord hereunder. Tenant shall, by thirty (30) days
written notice, advise Landlord of its intent to assign or transfer Tenant's
interest in the Lease or sublet the Premises or any portion thereof for any part
of the term hereof. Within two (2) weeks after receipt of said written notice,
Landlord may, at its sole discretion, elect to terminate this Lease as to the
portion of the Premises described in Tenant's notice on the date specified in
Tenant's notice by giving written notice of such election to terminate, however,
Tenant may, within three (3) business days after receipt of such election by
Landlord, rescind its request to assign or transfer Tenant's interest in the
Lease by providing Landlord written notice thereof, in which event Landlord's
election to terminate shall be null and void. If no such notice to terminate is
given to Tenant within said two (2) week period, Tenant may proceed to locate an
acceptable sublessee, assignee, or other transferee for presentment to Landlord
for Landlord's approval, all in accordance with the terms, covenants and
conditions of this Paragraph. If Tenant intents to sublet the entire Premises
and Landlord elects to terminate this Lease, this Lease shall be terminated on
the date specified in Tenant's notice. If, however, this Lease shall terminate
pursuant to the foregoing with respect to less than all the Premises, the rent,
as defined and reserved hereinabove shall be adjusted on a pro rata basis to the
number of square feet retained by Tenant, and this Lease as so amended shall
continue in Full force and effect. In the event Tenant is allowed to assign,
transfer or sublet the whole or any part of the Premises, with the prior written
consent of Landlord, which consent shall not be unreasonably withheld, no
assignee, transferee, subtenant or sub-subtenant shall assign or transfer this
Lease, either in whole or in part, or sublet the whole or any part of the
Premises, without also having obtained the prior written consent of Landlord,
which consent shall not be unreasonably withheld. A consent of Landlord to one
assignment, transfer, hypothecation, subletting, sub-subletting, occupation or
use by any other person shall not release Tenant from any of Tenant's
obligations hereunder or be deemed to be a consent to any subsequent similar or
dissimilar assignment, transfer, hypothecation, subletting, sub-subletting,
occupation or use by any other person. Any such assignment, transfer,
hypothecation, subletting, sub-subletting, occupation or use without such
consent shall be void and shall constitute a breach of this Lease by Tenant and
shall, at the option of Landlord exercised by written notice to Tenant,
terminate this Lease. The leasehold estate under this Lease shall not, nor shall
any interest therein, be assignable for any purpose by operation of law without
the written consent of Landlord, which consent shall not be unreasonably
withheld. As a condition to its consent, Landlord may require Tenant to pay all
expenses in connection with the assignment, and Landlord may require Tenant's
assignee or transferee (or other assignees or transferees) to assume in writing
all of the obligations under this Lease and for Tenant to remain liable to
Landlord under the Lease.
B. In addition to and notwithstanding anything to the contrary in
Paragraph 49A above, Tenant shall be entitled to assign or sublet without
Landlord's consent (but shall still give Landlord notice thereof) to: (i) any
parent or subsidiary corporation, or corporation with which consolidates, or
(ii) any third party or entity to whom Tenant sells all or substantially all of
its assets, provided, that the net worth of the resulting or acquiring
corporation has a net worth after the merger
Page 10 Initial: [ILLEGIBLE]
consolidation or acquisition equal to or greater than the net worth of Tenant at
the time of such merger, consolidation or acquisition. No such assignment or
subletting will release the Tenant from its liability and responsibility under
this Lease to the extent Tenant continues in existence following such
transaction.
C. Any and all sublease agreement(s) between Tenant and any and all
subtenant(s) (which agreements must be consented to by Landlord, pursuant to the
requirements of this Lease) shall contain the following language:
"If Landlord and Tenant jointly and voluntarily elect, for any reason
whatsoever, to terminate the Master Lease prior to the scheduled Master
Lease termination date, then this Sublease (if then still in effect) shall
terminate concurrently with the termination of the Master Lease. Subtenant
expressly acknowledges and agrees that (1) the voluntary termination of the
Master Lease by Landlord and Tenant and the resulting termination of this
Sublease shall not give Subtenant any right or power to make any legal or
equitable claim against Landlord, including without limitation any claim
for interference with contract or interference with prospective economic
advantage, and (2) Subtenant hereby waives any and all rights it may have
under law or at equity against Landlord to challenge such an early
termination of the Sublease, and unconditionally releases and relieves
Landlord, and its officers, directors, employees and agents, from any and
all claims, demands, and/or causes of action whatsoever (collectively,
"Claims"), whether such matters are known or unknown, latent or apparent,
suspected or unsuspected, foreseeable or unforeseeable, which Subtenant may
have arising out of or in - connection with any such early termination of
this Sublease. Subtenant knowingly and - intentionally waives any and all
protection which is or may be given by Section 1542 of the California Civil
Code which provides as follows: "A general release does not extend to
claims which the creditor does not know or suspect to exist in his favor at
the time of executing the release, which if known by him must have
materially affected his settlement with debtor.
The term of this Sublease is therefore subject to early termination.
Subtenant's initials here below evidence (a) Subtenant's consideration of
and agreement to this early termination provision, (b) Subtenant's
acknowledgment that, in determining the net benefits to be derived by
Subtenant under the terms of this Sublease, Subtenant has anticipated the
potential for early termination, and (c) Subtenant's agreement to the
general waiver and release of Claims above.
Initials:___________ Initials:_____________"
Subtenant Tenant
50. HAZARDOUS MATERIALS: Landlord and Tenant agree as follows with respect to
-------------------
the existence or use of "Hazardous Materials" (as defined herein) on, in, under
or about the Premises and real property located beneath said Premises
(hereinafter collectively referred to as the "Property") and the Complex:
A. As used herein, the term "Hazardous Materials" shall mean any
hazardous or toxic substance, material or waste which is or becomes subject to
or regulated by any local governmental authority, the State of California, or
the United States Government. The term "Hazardous Materials" includes, without
limitation any material or hazardous substance which is (i) listed under Article
9 or defined as "hazardous" or "extremely hazardous" pursuant to Article 11 of
Title 22 of the California Administrative Code, Division 4, Chapter 30, (ii)
listed or defined as a "hazardous waste" pursuant to the Federal Resource
Conservation and Recovery Act, Section 42 U.S.C. Section 6901 et. seq., (iii)
listed or defined as a "hazardous substance" pursuant to the Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601
et. seq. (42 U.S.C. Section 9601), (iv) petroleum or any derivative of
petroleum, or (v) asbestos.
B. Subject to the terms of this Paragraph 50, Tenant shall have no
obligation to "clean up", reimburse, release, indemnify, or defend Landlord with
respect to any Hazardous Materials or wastes which Tenant (prior to and during
the term of the Lease) or other parties on the Property (during the term of this
Lease) did not store, dispose, or transport in, use, or cause to be on the
Property in violation of applicable law.
C. Tenant will be 100 percent liable and responsible for (i) any and all
"cleanup" of said Hazardous Materials contamination which Tenant, its agents,
employees, contractors, invitees or its future subtenants and/or assignees (if
any), or other parties (other than Landlord or Landlord's employees, agents,
contractors or invitees)on the Property, does store, dispose, or transport in,
use or cause to be on the Property and which Tenant, its agents, employees,
contractors, invitees or its future
Page 11 Initial: [ILLEGIBLE]
subtenants and/or assignees (if any), or other parties on the Property, does
store, dispose, or transport in, use or cause to be on the Property, and (ii)
any claims, including third party claims, resulting from such Hazardous
Materials contamination described in clause (i) above. Tenant shall indemnify
Landlord and hold Landlord harmless from any liabilities, demands, costs,
expenses and damages, including, with-out limitation, attorney fees incurred as
a result of any claims resulting from such Hazardous Materials contamination
described in clause (i) above.
D. Tenant also agrees not to use or dispose of any Hazardous Materials on
the Property or the Complex without first obtaining Landlord's written
consent, except for the normal use in day-to- day operations of substances which
are substances which in certain strengths or quantities would be deemed
hazardous Materials, but which are typical for office us (e.g., so-called
-----
"liquid paper", copier toner, etc.). In the event consent is granted by
Landlord, Tenant agrees to complete compliance with governmental regulations,
and prior to the termination of said Lease Tenant agrees to follow the proper
closure procedures and will obtain a clearance from the local fire department
and/or the appropriate city agency. If Tenant uses Hazardous Materials, Tenant
also agrees: (i) to install, at Tenant's expense, such Hazardous Materials
monitoring devices as Landlord reasonably deems necessary and (ii) at Tenant's
sole cost and expense, each year upon the anniversary of the Commencement Date
of the Lease Term ("Anniversary Date"), to hire a qualified environmental
consultant, acceptable to Landlord, to evaluate whether Tenant is in compliance
with all applicable Governmental Regulations pertaining to Hazardous Materials.
Tenant shall submit to Landlord a report from such environmental consultant
which discusses the environmental consultant's findings within two (2) months of
each Anniversary Date. Tenant shall promptly take all steps necessary to correct
any and all problems identified by the environmental consultant and provide
Landlord with documentation of all such corrections. It is agreed that the
Parties' responsibilities related to Hazardous Materials will survive the
Termination Date of the Lease and that Landlord may obtain specific performance
of Tenant's responsibilities under this Paragraph 50.
51. MAINTENANCE OF THE PREMISES:
---------------------------
A. Roof: In addition to, and notwithstanding anything to the contrary in
----
Paragraphs 10, 44, and 55 Landlord shall, during the first six (6) months of the
Term of this Lease, be responsible for any costs for repair or damage (but not
maintenance) to the roof membrane covering the Leased Premises: provided that if
Tenant has caused such damage, Tenant shall be responsible for one hundred
(100%) percent of any such costs for repair or damage to the roof membrane so
caused by Tenant. Following the expiration of such six (6) month period Tenant
shall be responsible for paying one hundred percent (100%) of the cost of
repairs, maintenance and the replacement of the roof membrane throughout the
Term of the Lease as described in Paragraphs 4(D) and 7 above.
B. Building Systems: In addition to, and notwithstanding anything to the
----------------
contrary contained in Paragraphs 10 and 45, Landlord shall repair or cause to be
repaired, at Landlord's expense, any necessary repairs, as reasonably determined
by Landlord, (excluding maintenance) to the HVAC system, plumbing and standard
electrical wiring during the first six (6) month period in the initial Lease
Term, provided however, any repair resulting from Tenant's use will be paid for
one hundred (100%) percent by Tenant. Tenant shall notify Landlord of any such
necessary repairs and Landlord will approve such repairs and the related cost
before such repairs are made.
52. AMORTIZATION OF CAPITAL IMPROVEMENTS: Notwithstanding anything to the
------------------------------------
contrary in Paragraphs 7 and 10, Landlord shall amortize the cost of capital
improvements (if any) as an operating expense in accordance with standard
accounting practices and Tenant shall pay its pro rata share of said capital
improvement cost based on the remaining Term (and/or extended Term, if any) of
the Lease. For example: (i) Landlord incurs capital improvement costs of $I0,000
one year prior to Lease Termination Date, and (ii) said capital improvement's
life is ten (10) years; Tenant shall pay upon receipt of invoice from Landlord
its pro rata share of $1.000.00).
In the event the Term of the Lease is extended for any reason whatsoever,
Tenant's pro rata share of the capital improvement cost shall be increased to
include the additional amount payable to Landlord due to the Extended Term of
the Lease. For Example: In the event: (i) Landlord incurred capital improvement
costs illustrated above; and (ii) this Lease is extended for an additional three
year period, Tenant would be liable for an additional payment to Landlord of
$3,000.00 as Additional Rent. Said payment would be due in full immediately upon
Tenant's execution of Lease documentation related to said Lease extension.
Page 12 Initial: [ILLEGIBLE]
53. COMPLIANCE (CONTINUED): Any non-conformance of the Tenant Improvements
----------------------
installed and paid for by Landlord as set forth on Exhibit B, required to be
----------
corrected by a governing agency, shall be corrected at the cost and expense of
Landlord if such non-conformance exists as of the Commencement Date of the Lease
and further provided that such governing agency's requirement to "correct the
non-conformance is not initiated as a result of: (i) any future improvements
made by Tenant; or (ii) any permit request made to a governing agency by Tenant.
Any non-conformance of the Premises occurring after the Commencement Date of
this Lease Agreement shall be the responsibility of Tenant to correct at
Tenant's cost and expense.
54. ADDITIONAL RENT (CONTINUED): Notwithstanding anything to the contrary in
---------------------------
Xxxxxxxxx 0X, Xxxxxxxx shall provide a written reconciliation in reasonable
detail of the foregoing expenses within one hundred twenty (120) days after the
end of each calendar year, or more frequently if Landlord elects to do so, at
Landlord's sole and absolute discretion. Within thirty (30) days after receipt
of Landlord's reconciliation, Tenant shall have the right, at Tenant's sole
expense, to audit, at a mutually convenient time at Landlord's office,
Landlord's records relating to the foregoing expenses. Such audit must be
conducted by Tenant or an independent nationally recognized accounting firm that
is not being compensated by Tenant or other third part), on a contingency fee
basis. If such audit reveals that Landlord has overcharged Tenant, the amount
overcharged shall be credited to Tenant's account within thirty (30) days after
the audit is concluded. If the audit reveals Tenant has been undercharged,
Tenant shall pay the amount of the undercharge within thirty (30) days of
receipt of a statement from Landlord.
The following items shall be excluded from "Additional Rent":
A. Any expense reasonably allocable to a particular building in the
Complex, rather than to the Complex as a whole; provided however, that
any expense incurred by Landlord for Tenant's Leased Premises shall be
included as Additional Rent.
B. Leasing commissions, attorney's fees, costs, disbursements, and other
expenses incurred in connection with negotiations with other tenants,
or disputes between Landlord and other tenants, or in connection with
marketing, leasing, renovating, or improving space for other current
or prospective tenants or other current or prospective occupants of
the Complex.
C. The cost of any service sold to any other tenant or other occupant for
which Landlord is entitled to be reimbursed as an additional charge or
rental over and above the basic rent and additional rent payable under
the lease agreement with said other tenant or other occupant
(including, without limitation, after-hours HVAC costs or over-
standard electrical consumption costs incurred by other tenants or
occupants).
D. Any costs for which Landlord is reimbursed by others.
E. Any costs, fines, or penalties incurred due to violations by Landlord
of any governmental role or authority.
F. Management costs to the extent they exceed two percent (2%) of the
monthly Basic Rent due under the Lease.
G. Wages, salaries, or other compensation paid to executive employees
above the grade of Property Manager.
H. The cost of correcting any building code or other violations which are
violations prior to the Lease Commencement Date and which violations
were not caused by or contributed to by Tenant.
I. Repairs or other work occasioned by fire, windstorm, or other insured
casualty or hazard, to the extent that Landlord shall receive proceeds
of such insurance or would have received such proceeds had Landlord
maintained the insurance coverage required under this Lease.
J. Repairs or building necessitated by condemnation.
K. Depreciation and amortization, other than as permitted pursuant to
this Lease.
L. Except as otherwise noted in this Lease, debt service payments on any
indebtedness
Page 13 Initial: [ILLEGIBLE]
applicable to the Complex or any portion thereof, including any
mortgage debt, or ground rents or any other amounts payable under any
ground lease for the Property.
M. Space planning fees and commissions.
N. Any amounts paid to any person, firm or corporation related or
otherwise affiliated with Landlord or any general partner, officer, or
director of Landlord or any general partners, to the extent same
exceeds arms-length competitive prices paid in the Santa Clara,
California metropolitan area for the services or goods provided.
55. COMMON AREA MAINTENANCE: Subject to Paragraph 5, ("Rules and Regulations
-----------------------
and Common Area ) and Paragraph 7, ("Expenses of Operation, Management, and
Maintenance of the Common Areas of the Complex and Building in Which the
Premises are Located"), Landlord shall maintain or cause to be maintained and
repaired the Common Areas of the Complex (such as Common Area elevators, stairs,
corridors, restrooms and sidewalks), all landscaping, parking areas and all
portions of the Complex, the maintenance of which is not the express obligation
of Tenant or other occupants of the Complex, and Tenant shall pay its pro rata
share of said costs and expenses for said maintenance and repairs.
56. SUBORDINATION AND MORTGAGES (CONTINUED): Notwithstanding anything to
---------------------------------------
contrary contained in Paragraph 20 of this Lease, Tenant's agreement to
subordinate to any existing or future lender shall be conditional upon the
receipt by Tenant of a non-disturbance agreement on such lender's commercially
reasonable form, executed by Landlord and such lender.
57. ENTRY BY LANDLORD (CONTINUED): Notwithstanding anything to the contrary
-----------------------------
contained in Paragraph 21 of this Lease, Tenant shall have the right to require
that Landlord be accompanied by a representative of Tenant during any entry of
the Premises pursuant to the provisions of Paragraph 21 of the Lease (except in
the case of emergency).
58. SALE OR CONVEYANCE BY LANDLORD (CONTINUED): Not withstanding anything to
------------------------------------------
the contrary in the Lease, if Landlord sells or otherwise conveys its interest
in the Premises, Landlord shall not be relieved of its obligation under the
Lease, unless and until Landlord transfers the balance of Tenant's Security
Deposit (if any) to its successor and the successor assumes in writing Landlords
obligations under the Lease.
59. OPTION TO EXTEND LEASE. FOR FIVE (5) YEARS: Provided Tenant is not in
------------------------------------------
default (pursuant to Paragraph 22 of the Lease, i.e., Tenant has received notice
-----
and any applicable cure period has expired without cure) of any of the terms,
covenants, and conditions of this Lease Agreement, Landlord hereby grants to
Tenant an Option to Extend this Lease Agreement for an additional five (5) year
period (the "Extended Term") upon the following terms and conditions.
A. Tenant shall give Landlord written notice of Tenant's exercise of this
Option to Extend not later than twelve (12) months prior to the scheduled Lease
Termination Date, which date is currently projected to be December 31, 2003, in
which event the Lease shall be considered extended for an additional five (5)
years subject to the Basic Rental set forth below and with: (i) the terms and
conditions subject to amendment by Landlord (Landlord, in its sole and absolute
discretion, may, but is not required to, incorporate its current Lease
provisions that are standard in Landlord's leases as of the date or Tenant's
exercise of its Option to Extend) and (ii) this Paragraph 39, deleted. In the
event that Tenant fails to timely exercise Tenants option as set forth herein in
writing, Tenant shall have no further Option to Extend this Lease, and this
Lease shall continue in full force and effect for the full remaining term
hereof, absent this Paragraph 59.
B. The following summarizes the Basic Monthly Rental and the related per
square foot charge by period under the Lease Agreement that would be applied to
the Extended Term:
Page 14 Initial: [ILLEGIBLE]
Monthly
Period PSF Rate Basic Rental
01/01/04 - 12/31/04 $2.20 $52,800.00
01/01/05 - 12/31/05 $2.25 $54,000.00
01/01/06 - 12/31/06 $2.30 $55,200.00
01/01/07 - 12/31/07 $2.35 $56,400.00
01/01/08 - 12/31/08 $2.40 $57,600.00
C. The option rights of Tenant under this Paragraph 59, and the Extended Term
thereunder, are granted for Tenant's personal benefit and may not be assigned or
transferred by Tenant, (except to a parent or subsidiary corporation, or
corporation with which Tenant merges or consolidates or to whom Tenant sells all
or substantially all of its assets as provided for in Paragraph 49), either
voluntarily or by operation of law, in any manner whatsoever. In the event that
Landlord consents to a sublease or assignment under Paragraph 49, the option
granted herein and any Extended Term thereunder shall be void and of no force
and effect, whether or not Tenant shall have purported to exercise such option
prior to such assignment or sublease.
D. INCREASED SECURITY DEPOSIT: In the event the term of Tenant's Lease is
--------------------------
extended pursuant to this Paragraph 59, Tenant's Security Deposit shall be
increased to equal twice the Basic Rental due for the last month of the extended
term (i.e. $57.600.00 per month X 2 = $115,200.00).
60. MAINTENANCE OF THE PREMISES: Notwithstanding anything to the contrary in
---------------------------
Paragraph 10, Landlord shall repair damage to the structural shell, foundation,
and roof structure (but not the interior improvements, roof membrane, or
glazing) of the building leased hereunder at Landlord's cost and expense
provided Tenant has not caused such damage, in which event Tenant shall be
responsible for 100 percent of any such costs for repair or damage so caused by
the Tenant. Notwithstanding the foregoing, a crack in the foundation, or
exterior walls that does not endanger the structural integrity of the building,
or which is not life-threatening, shall not be considered material, and shall
not require either Landlord or Tenant to repair the same (unless Tenant has
caused the damage, in which case Tenant shall be responsible for the cost of
said repair(s) regardless of how minor said repair(s) may be).
[SITE PLAN APPEARS HERE]
Park Square - Phase 2
Buildings 1 - 6
Xxxxx Xxxxx, Xxxxxxxxxx 00000
EXHIBIT A TO LEASE AGREEMENT DATED SEPTEMBER 4, 1996 BY AND BETWEEN THE
---------
ARRILLAGA FAMILY TRUST AND THE XXXXXXX X. XXXXX SEPARATE PROPERTY TRUST, AS
LANDLORD AND THE VANTIVE CORPORATION, AS TENANT.
[PLAN APPEARS HERE]
EXHIBIT B TO LEASE AGREEMENT DATED SEPTEMBER 4, 1996 BY AND BETWEEN THE
---------
ARRILLAGA FAMILY TRUST AND THE XXXXXXX X. XXXXX SEPARATE PROPERTY TRUST, AS
LANDLORD, AND THE VANTIVE CORPORATION, AS TENANT.
