EXHIBIT 10.13
THIS AGREEMENT or LEASE is made this 27th day of June, 1997,
BETWEEN:
THE MANUFACTURERS LIFE INSURANCE COMPANY (U.S.A.), a company
domiciled in the State of Michigan and having an office at 000
Xxxxx Xxxxxx Xxxx, Xxxxxxx, Xxxxxxx X0X 0X0, XXXXXX, and having a
local office at 000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000,
in the City
of Xxx Xxxxxxx, Xxxxx xx Xxxxxxxxxx 00000
(hereinafter called the "Landlord"),
OF THE FIRST PART,
--and--
EXODUS COMMUNICATIONS, INC.,
a California corporation
having an office at 0000 Xxxxx Xxxxx
in the City
of Xxxxx Xxxxx, Xxxxx xx Xxxxxxxxxx 00000
(hereinafter called the "Tenant"),
OF THE SECOND PART.
In consideration of the "Rent" (as hereinafter defined), covenants and
agreements hereinafter contained, the Landlord and Tenant hereby agree as
follows:
1. LEASED PREMISES
Leased The Landlord does demise and lease to the Tenant the premises
Premises located in the building (the "Building") having a municipal
address of 72 Corporate Park in the City of Xxxxxx, Xxxxx xx
Xxxxxxxxxx 00000, and known as Suite 100 (the "Leased
Premises") (the Leased Premises, the Building, together with
the lands described in Schedule "A" attached hereto and
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present and future improvements, additions and changes thereto
being herein called the "Property"), with the Leased Premises
consisting of approximately sixteen thousand seven hundred
fifty (16,750) rentable square feet on the first (1st)
floor(s) of the Building as outlined on the plan or plans
marked Schedule(s) "B-1" and attached hereto, excluding the
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exterior surfaces of the exterior walls
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of the Leased Premises. As of the date of this Lease, the
parties hereto agree that the rentable square footage of the
Leased Premises is approximately sixteen thousand seven
hundred fifty (16,750) square feet. Within ten (10) days prior
to the "Commencement Date" of the "Term" (as both terms are
hereinafter defined), Landlord shall provide to Tenant, in
writing, the actual rental square footage of the Leased
Premises, as calculated by Landlord's architect or space
planner, with supporting documentation from same, in
accordance with the then-current standards promulgated by the
Building Owners and Managers Association for use in the
Southern California area (the "BOMA Standard") (for example,
ANSI 265.1-1989), which BOMA Standard will be adjusted to
reflect any particularities of the Building and/or the
Property; provided, however, if the determination of the
actual rental square footage of the Leased Premises is
different from sixteen thousand seven hundred fifty (16,750)
rentable square feet, Landlord and Tenant will execute an
amendment to this Lease prior to the Commencement Date, as
prepared by Landlord and reasonably approved and executed by
Tenant, which amendment shall modify the "Basic Rent,"
"Tenant's Proportionate Share" (as both terms are hereinafter
defined), and any other applicable provisions of this Lease,
to reflect the actual rentable square footage of the Leased
Premises. See Schedules "F," "L" and "N" attached hereto.
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2. TERM
Term (a) TO HAVE AND TO HOLD the Leased Premises for and during the
term of ten (10) years and no days/months (the "Term") to be
computed from the first (1st) day of September, 1997 (the
"Commencement Date"), and to be fully complete and ended on
the thirty-first (31st) day of August, 2007 (the "Expiration
Date"), unless otherwise terminated. See Schedules "F," "H"
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and "I" attached hereto.
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Delay in (b) If the Leased Premises or any part thereof are not ready
Occupancy for occupancy on the Commencement Date (as a result of a delay
in Landlord's construction and completion of "Landlord's Work"
(as hereinafter defined)), no part of the Rent or only a
proportionate part thereof, in the event that the Tenant shall
occupy a part of the Leased Premises, shall be payable for the
period prior to the date when the entire Leased Premises are
ready for occupancy and the full Rent shall accrue only after
such last mentioned date. The Tenant agrees to accept any such
abatement of Rent in full settlement of all claims which the
Tenant might otherwise have by reason of the Leased Premises
not being ready for occupancy on the Commencement Date;
provided that when the Landlord has completed construction of
such part of the Leased Premises as it is obliged hereunder to
construct, the Tenant shall not be entitled to any abatement
of Rent for any delay in occupancy due to the Tenant's failure
or delay to provide plans or to complete any special
installations or other work required for its purposes or due
to any other reason, nor shall the Tenant be entitled to any
abatement of Rent for any delay in occupancy if the Landlord
has been unable
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to complete construction of the Leased Premises by reason of
such failure or delay by the Tenant. A certificate of the
Landlord as to the date the Leased Premises were ready for
occupancy and such construction as the Landlord is obliged to
complete is substantially completed, or as to the date upon
which the same would have been ready for occupancy and
completed, respectively, but for the failure or delay of the
Tenant, shall be conclusive and binding on the Tenant and Rent
in full shall accrue and become payable from the date set out
in the said certificate. See Schedule "I" attached hereto.
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Over-holding (c) If at the expiration of the Term or sooner termination
hereof, the Tenant shall remain in possession without any
further written agreement or in circumstances where a tenancy
would thereby be created by implication of law or otherwise, a
tenancy from year to year shall not be created by implication
of law or otherwise, but the Tenant shall be deemed to be a
monthly tenant only, at one hundred fifty percent (150%) of
the then-current Basic Rent (payable monthly in advance) plus
all "Additional Rent" (as hereinafter defined) and otherwise
upon and subject to the same terms and conditions as herein
contained, excepting provisions for renewal (if any) and
leasehold improvement allowance (if any), contained herein,
and nothing, including the acceptance of any Rent by the
Landlord, for periods other than monthly periods, shall extend
this Lease to the contrary except an agreement in writing
between the Landlord and the Tenant, and Tenant hereby
authorizes the Landlord to apply any monies received from the
Tenant in payment of such monthly Rent. The Tenant hereby
agrees to indemnify, defend and hold Landlord, the Leased
Premises and the Property harmless from and against any and
all losses, costs, damages and liabilities (including
reasonable attorneys' fees and costs, and court costs, but
excluding any consequential or punitive damages claimed by
Landlord) which the Landlord may suffer as a result of the
Tenant's failure to timely surrender exclusive possession of
the Leased Premises to Landlord, as set forth herein.
3. RENT
Basic Rent (a) The Tenant shall without deduction or right of offset pay
to the Landlord yearly and every year during the Term as
rental (herein called "Basic Rent"), the sum of Two Hundred
Fifty-One Thousand Two Hundred Fifty Dollars (US$251,250.00)
of lawful money of the jurisdiction in which the Leased
Premises are located, in equal monthly installments of Twenty
Thousand Nine Hundred Thirty-Seven and 50/100 Dollars
(US$20,937.50) each in advance on the first day of each month
during the Term, the first payment to be made upon the
Tenant's execution of this Lease and applied by Landlord to
the first month of the Term; provided, however, the Basic Rent
shall be increased in accordance with Schedule "K" attached
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hereto.
Additional (b) The Tenant shall, without deduction or right of offset
Rent pay to the Landlord yearly and every year during the Term, as
additional rental (herein
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called "Additional Rent"):
(i) the amounts of any Taxes payable by the Tenant to
the Landlord pursuant to the provisions of Schedule "C"
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attached hereto; and
(ii) the amounts required to be paid to the Landlord
pursuant to the provisions of Schedule "D" attached hereto.
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Payment- (c) Additional Rent shall be paid and adjusted with
Additional reference to a fiscal period of twelve (12) calendar months
Rent ("Fiscal Period"), which shall be a calendar year unless the
Landlord shall from time to time have selected a Fiscal Period
which is not a calendar year by written notice to the Tenant.
The Landlord shall advise the Tenant in writing of its
estimate of the Additional Rent to be payable by the Tenant
during the Fiscal Period (or broken portion of the Fiscal
Period, as the case may be, if applicable at the Commencement
Date or because of a change in Fiscal Period) which commenced
upon the Commencement Date and for each succeeding Fiscal
Period or broken portion thereof which commences during the
Term. Such estimate shall in every case be a reasonable
estimate and, if requested by the Tenant, shall be accompanied
by reasonable particulars of the manner in which it was
calculated. The Additional Rent payable by the Tenant shall be
paid in equal monthly installments in advance at the same time
as payment of Basic Rent is due hereunder based on the
Landlord's estimate as aforesaid. From time to time, the
Landlord may re-estimate, on a reasonable basis, the amount of
Additional Rent for any Fiscal Period or broken portion
thereof, in which case the Landlord shall advise the Tenant in
writing of such re-estimate and fix new equal monthly
installments for the remaining balance of such Fiscal Period
or broken portion thereof. After the end of each such Fiscal
Period or broken portion thereof the Landlord shall submit to
the Tenant a statement of the actual Additional Rent payable
in respect of such Fiscal Period or broken portion thereof and
a calculation of the amounts by which the Additional Rent
payable by the Tenant exceeds or is less than (as the case may
be) the aggregate installments paid by the Tenant on account
of Additional Rent for such Fiscal Period. Within thirty (30)
days after the submission of such statement either the Tenant
shall pay to the Landlord any amount by which the amount found
payable by the Tenant with respect to such Fiscal Period or
broken portion thereof exceeds the aggregate of the monthly
payments made by it on account thereof during such Fiscal
Period or broken portion thereof, or the Landlord shall pay to
the Tenant any amount by which the amount found payable as
aforesaid is less than the aggregate of such monthly payments.
Accrual of (d) Basic Rent and Additional Rent (herein collectively
Rent called "Rent") shall be considered as accruing from day to
day, and Rent for an irregular period of less than one year or
less than one calendar month shall be apportioned and
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adjusted by the Landlord for the Fiscal Periods of the
Landlord in which the tenancy created hereby commences and
expires. Where the calculation of Additional Rent for a period
cannot be made until after the termination of this Lease, the
obligation of the Tenant to pay Additional Rent shall survive
the termination hereof and Additional Rent for such period
shall be payable by the Tenant upon demand by the Landlord. If
the Term commences or expires on any day other than the first
or the last day of a month, Rent for such fraction of a month
shall be apportioned and adjusted as aforesaid and paid by the
Tenant on the actual Commencement Date of the Term.
Recovery of (e) Rent and any other amounts required to be paid by the
Rent Tenant to the Landlord under this Lease shall be deemed to
be, and will be treated as, Rent, and be payable and
recoverable as Rent, and the Landlord shall have all rights
against the Tenant for default in any payment of Rent and
other amounts as in the case of arrears in Rent.
Limitations (f) The information set out in statements, documents or other
writings setting out the amount of Additional Rent submitted
to the Tenant under or pursuant to this Lease shall be binding
on the Tenant and deemed to be accepted by it and shall not be
subject to amendment for any reason unless the Tenant gives
written notice to the Landlord within sixty (60) days of the
Landlord's submission of such statement, document, or writing
identifying the statement , document, or writing and setting
out in reasonable detail the reason why such statement,
document or writing should not be binding on the Tenant.
However, and within the sixty (60) day period provided to the
Tenant herein, Tenant shall have the right, after at least
five (5) business days' prior written notice to Landlord and
only at reasonable times during normal business hours at
Landlord's offices in Los Angeles, California, to review
Landlord's records pertaining to the calculation of Additional
Rent , all at Tenant's sole cost and expense (except as
otherwise provided herein). Landlord hereby agrees to use
commercially reasonable efforts to cooperate with Tenant in
and during such review; provided, Landlord shall not be
obligated to expend any monies in connection therewith. If,
after such review, Tenant disputes the amount of Additional
Rent billed to Tenant, Tenant may retain a reputable,
independent, certified public accountancy firm to audit
Landlord's records regarding the disputed item or items in
order to determine the proper amount of Additional Rent. If
such audit reveals that Landlord has overcharged Tenant, then
within thirty (30) days after the results of such audit are
made available to Landlord, Landlord shall reimburse Tenant
for the amount of such overcharge. If the audit reveals that
Tenant was undercharged, then within thirty (30) days after
the results of such audit are made available to Tenant, Tenant
shall reimburse Landlord for the amount of such undercharge.
Tenant hereby agrees to pay all costs and expenses associated
with any such audit; provided, however, Landlord shall pay
such costs and expenses if the audit reveals that Landlord's
determination of Additional Rent was in error by more than
five percent (5%). Landlord shall use commercially reasonable
efforts to maintain the records
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regarding the Additional Rent charged to Tenant after their
billing to Tenant, but Tenant will not be entitled to audit or
adjust any calculation of Additional Rent after the above-
referenced sixty (60) day period has elapsed from the date of
the billing of the applicable Additional Rent.
4. SECURITY DEPOSIT
Security The Tenant shall pay to the Landlord on execution of this
Deposit Lease by the Tenant the sum of Twenty Thousand Nine Hundred
Thirty-Seven and 50/100 Dollars ($20,937.50) as the "security
deposit" and/or "Security Deposit" for the payment by the
Tenant of any and all present and future debts and liabilities
of the Tenant to the Landlord and for the performance by the
Tenant of all of its obligations arising under or in
connection with this Lease (the "Debts , Liabilities and
Obligations"). The Landlord shall not be required to keep the
Security Deposit separate from its general funds. In the event
of the Landlord disposing of its interest in this Lease, the
Landlord shall credit the Security Deposit to its successor
and thereupon shall have no liability to the Tenant to repay
the Security Deposit to the Tenant; provided, Landlord will
have delivered to Tenant written notice of Landlord's transfer
or disposition of all or any portion of Landlord's interest in
this Lease. Subject to the foregoing and to the Tenant not
being in default under this Lease, the Landlord shall repay
the Security Deposit to the Tenant without interest at the end
of the Term or sooner termination of the Lease; provided, that
all Debts, Liabilities and Obligations of the Tenant to the
Landlord are paid and performed in full, failing which the
Landlord may on notice to the Tenant elect to retain the
Security Deposit and to apply it in reduction of the Debts,
Liabilities and Obligations and the Tenant shall remain fully
liable to the Landlord for payment and performance of the
remaining Debts, Liabilities and Obligations. See Schedule "M"
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attached hereto.
Landlord's (a) The Landlord covenants with the Tenant:
Covenant
(i) for quiet enjoyment of the Leased Premises; and
(ii) to observe and perform all the covenants and
obligations of the Landlord herein.
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Tenants'
Covenant (b) The Tenant covenants with the Landlord:
(i) to pay Rent; and
(ii) to observe and perform all the covenants and
obligations of the Tenant herein.
6. USE AND OCCUPANCY
The Tenant covenants with the Landlord:
Use (a) not to use the Leased Premises for any purpose other than
as an office for the conduct of the Tenant's business, which
is as a data center with administrative and research
functions, and general office uses.
Waste,
Nuisance, etc. (b) not to commit, or permit, any waste, injury or damage to
the Property, including the "Leasehold Improvements" (as
hereinafter defined) and any trade fixtures therein, any
loading of the floors thereof in excess of the maximum degree
of loading as determined by the Landlord acting reasonably
(with the degree of loading not to be less than "live load" of
one hundred twenty-five pounds (125 lbs.) per square foot of
floor area for the Leased Premises only during the Term), any
nuisance therein or any use or manner of use causing annoyance
to other tenants and occupants of the Property or to the
Landlord;
Insurance (c) not to do, omit or permit to be done or omitted to be
Risks done upon the Property anything which would cause to be
increased the Landlord's cost of insurance or the costs of
insurance of another tenant of the Property against perils as
to which the Landlord or such other tenant has insured or
which shall cause any policy of insurance on the Property to
be subject to cancellation;
Compliance (d) to comply at its own expense with all governmental laws,
with Law regulations and requirements pertaining to the occupation and
use of the Leased Premises, the condition of the Leasehold
Improvements, trade fixtures, furniture and equipment
installed by or on behalf of the Tenant therein and the making
by the Tenant of any repairs, changes or improvements therein.
In connection with Tenant's obligations under this Paragraph
6(d) and in Paragraph 6(e) of this Lease, and after the
Commencement Date, Tenant hereby acknowledges and agrees that
any changes or modifications to the common areas or any other
part of the Building and/or the Property, which are required
to be made pursuant to the applicable federal, state, local,
municipal, governmental or quasi-governmental laws, rules,
regulations or orders (including, but not limited to, the
Americans with Disabilities Act of 1990, as amended ("ADA"),
and also including, without limitation, any modifications to
the bathrooms within the Building), shall be paid for by
Tenant as part of Tenant's Proportionate Share of the
Operating Costs, but with regard to any Leasehold Improvements
or
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alterations, additions or improvements to the Leased Premises
made after the Commencement Date, they shall be paid for by
Tenant, at Tenant's sole cost and expense. Prior to the
Commencement Date, Landlord hereby agrees that the building
and the Property will be in compliance with applicable laws,
regulations and requirements, including ADA and "Environmental
Laws" (as hereinafter defined).
Environmental (e) (i) to conduct and maintain its business and
Compliance operations at the Leased Premises so as to comply
in all respects with common law and with all
present and future applicable federal,
provincial/state, local, municipal, governmental
or quasi-governmental laws, bylaws, rules,
regulations, licenses, orders, guidelines,
directives, permits, decisions or requirements
concerning occupational or public health and
safety or the environment and any order,
injunction, judgment, declaration, notice or
demand issued thereunder (collectively,
"Environmental Laws").
(ii) not to permit or suffer any substance which is
hazardous or is prohibited, restricted, regulated
or controlled under any Environmental Laws to be
present at, on or in the Leased Premises and/or
the Property, unless it has received the prior
written consent of the Landlord, which consent may
be arbitrarily withheld by the Landlord (except
for general business supplies (such as copier
toner, liquid paper, glue, ink and/or cleaning
solvents) for use in the manner in which they were
designed and only in types and amounts necessary
for normal business operations). Notwithstanding
anything to the contrary set forth in this
Paragraph 6(e)(ii), Landlord hereby consents to
Tenant's use of diesel fuel on the Property for
the sole purpose of the "UPS Generator" (as
hereinafter defined), pursuant to Schedule "F"
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attached hereto, which shall be in compliance by
Tenant with all Environmental Laws, and shall be
used only in the manner for which it was designed
and only in the type and amount necessary for
normal operation of the UPS Generator.
(iii) Except as the result of Tenant's negligence and/or
willful misconduct or as caused by any act or
omission of Tenant and/or Tenant's agents,
contractors and representatives, the Tenant will
not be responsible for the violation of any
Environmental Laws affecting the Property arising
either prior to the Commencement Date or the
"Improvement Period" (as hereinafter defined)
described in Schedule "I" attached hereto.
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Rules and
Regulations (f) to observe and perform, and to cause its employees,
invitees and others over whom the Tenant can reasonably be
expected to exercise control to
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observe and perform, the Rules and Regulations contained in
Schedule "E" attached hereto, and such further and other
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reasonable rules and regulations and amendments and additions
therein as may hereafter be made by the Landlord and notified
in writing to the Tenant, except that no change or addition
may be made that is inconsistent with this Lease, unless as
may be required by governmental regulation or unless the
Tenant consents thereto. The imposition of such Rules and
Regulations shall not create or imply any obligation of the
Landlord to enforce them or create any liability of the
Landlord for their non-enforcement or otherwise.
7. ASSIGNMENT AND SUB-LETTING
No Assignment
and Sub-letting (a) The Tenant covenants that it will not assign this Lease
or sub-let the Leased Premises in whole or in part without the
prior written consent of the Landlord, which consent the
Landlord covenants not to unreasonably withhold or delay, (i)
as to any assignee or sub-lessee who is in a satisfactory
financial condition, agrees to use the Leased Premises for
those purposes permitted hereunder, and (ii) as to any portion
of the Leased Premises which, in the Landlord's reasonable
judgment, is a proper and rational division of the Leased
Premises, subject to the Landlord's right of termination
arising under this Paragraph 7. Without limitation, the Tenant
shall for the purpose of this Paragraph 7 be considered to
assign or sub-let in any case where it permits the Leased
Premises or any portion thereof to be, or the Leased Premises
or any portion thereof are, occupied by persons other than the
Tenant, its employees and others engaged in carrying on the
business of the Tenant, whether pursuant to assignment, sub-
letting, license or other right, or where any of the foregoing
occurs by operation of law. Notwithstanding anything to the
contrary set forth in this Lease, Tenant may assign this Lease
at any time, or sublease all or a part of the Leased Premises,
upon prior written notice to Landlord but without receipt of
Landlord's prior written consent, to any entity which acquires
a majority of Tenant's assets or stock, or is merged or
consolidated with Tenant, or which controls, is controlled by
or is under common control with, Tenant (collectively, an
"Affiliate"), so long as (i) such transaction was not entered
into as a subterfuge to avoid the obligations and restrictions
of this Lease, (ii) at least ten (10) days prior to the
effective date of the transaction, Tenant notifies Landlord of
such transaction and supplies Landlord with any documents or
information reasonably requested by Landlord regarding such
transaction or such Affiliate, (iii) in the case of an
assignment, such Affiliate conclusively agrees, in writing
delivered to Landlord prior to the effective date of the
transaction, to assume all of Tenant's obligations under this
Lease, and (iv) the net worth of such Affiliate, as of the
effective date of the assignment or sublease, is at least
equal to the net worth of Tenant as of the date of this Lease.
Any such assignment or subletting to an Affiliate pursuant to
this Paragraph 7 shall neither release nor relieve Tenant from
any of Tenant's obligations under this Lease.
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Assignment or (b) The Tenant shall not assign this Lease or sub-let the
Sub-letting whole or any part of the Leased premises unless:
Procedures
(i) it shall have received or procured a bona fide
written offer to take an assignment or sub-lease,
which is not inconsistent with this Lease and
would not breach any provisions of this Lease, and
(ii) it shall have first requested and obtained the
consent in writing of the Landlord thereto.
Any request for consent shall be in writing and accompanied by
a copy of the offer certified by the Tenant to be true and
complete, and the Tenant shall furnish to the Landlord all
information available to the Tenant and requested by the
Landlord as to the responsibility, financial standing and
business of the proposed assignee or sub-tenant.
Notwithstanding anything to the contrary set forth in
Paragraph 7(a) of this Lease (except for any assignment or
subleasing to an Affiliate, as set forth in such Paragraph
7(a) above), and commencing on and after September 1, 2000
(unless Tenant attempts to assign a portion of this Lease or
sublet a portion of the Leased Premises which, in the
aggregate, are in excess of twenty-five percent (25%) of
Tenant's total interest in this Lease or the Leased Premises,
respectively, in which event Landlord's termination right
hereunder shall apply immediately, if so elected by Landlord),
then within twenty (20) days after the receipt by the Landlord
of such request for consent and of all information which the
Landlord shall have requested hereunder, the Landlord shall
have the right upon written notice of termination submitted to
the Tenant, if the request is to assign this Lease or sub-let
the whole of the Leased Premises, to cancel and terminate this
Lease, or if the request is to sub-let a part of the Leased
Premises only, to cancel and terminate this Lease with respect
to such part, in each case as of a termination date to be
stipulated in the notice of termination which shall be not
less than sixty (60) days or more than ninety (90) days
following the giving of such notice. In such event the Tenant
shall surrender the whole or part, as the case may be, of the
Leased Premises in accordance with such notice of termination
and Basic Rent and Additional Rent shall be apportioned and
paid to the date of surrender and, if a part only of the
Leased Premises is surrendered, Basic Rent and Additional Rent
shall after the date of surrender xxxxx proportionately. If
such consent shall be given the Tenant shall assign or sub-
let, as the case may be, only upon the terms set out in the
offer submitted to the Landlord as aforesaid and not
otherwise.
Assumption of (c) No assignment or sub-letting of this Lease shall be
Obligations effective unless the assignee or sub-lessee shall execute an
assumption agreement on the Landlord's commercially reasonable
form, assuming all the obligations of the Tenant hereunder,
and shall pay to the Landlord its reasonable fee for
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processing the assignment or sub-letting, which fee will not
exceed $l,200.00 per request.
Tenant's (d) The Tenant agrees that any consent to an assignment or
Continuing sub-letting of this Lease or Leased Premises shall not thereby
Obligations release the Tenant of its obligations hereunder.
8. REPAIR & DAMAGE
Landlord's (a) The Landlord covenants with the Tenant to keep in a
Repairs to good and reasonable state of repair and decoration:
Building and
Property
(i) those portions of the Property consisting of the
entrance, lobbies, stairways, corridors, landscaped areas,
parking areas, and other facilities from time to time provided
for use in common by the Tenant and other tenants of the
Building or Property, and the exterior portions (including
foundations, exterior walls and all aspects of the roof) of
the Building and structures from time to time forming part of
the Property and affecting its general appearance;
(ii) the Building (other than the Leased Premises and
premises of other tenants) including the systems for interior
climate control, the elevators and escalators (if any),
entrances, lobbies, stairways, corridors and washrooms from
time to time provided for use in common by the Tenant and
other tenants of the Building or Property and the systems
provided for use in common by the Tenant and other tenants of
the Building or Property and the systems provided for bringing
utilities to the Leased Premises.
Landlord's (b) Except as the result of the Tenant's negligence and/or
Repairs to the willful misconduct, the Landlord covenants with the Tenant to
Leased Premises repair, so far as reasonably feasible, and as expeditiously as
reasonably feasible, defects in standard demising walls or in
structural elements, exterior walls of the Building, suspended
ceiling, electrical and mechanical installations standard to
the Building installed by the Landlord in the Leased Premises
(if and to the extent that such defects are sufficient to
impair the Tenant's use of the Leased Premises while using
them in a manner consistent with this Lease) and "Insured
Damage" (as hereinafter defined). The Landlord shall in no
event be required to make repairs to Leasehold Improvements
made by the Tenant, or by the Landlord on behalf of the Tenant
or another tenant or to make repairs to wear and tear within
the Leased Premises.
Tenant's (c) The Tenant covenants with the Landlord to repair,
Repairs maintain and keep at the Tenant's own cost, except insofar as
the obligation to repair rests upon the Landlord pursuant to
this Paragraph 8, the Leased Premises, including Leasehold
Improvements in good and substantial repair, reasonable wear
and
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tear excepted, provided that this obligation shall not extend
to structural elements or to exterior glass or to repairs
which the Landlord would be required to make under this
Paragraph 8 but for the exclusion therefrom of defects not
sufficient to impair the Tenant's use of the Leased Premises
while using them in a manner consistent with this Lease. The
Landlord, upon at least twenty-four (24) hours prior written
notice to the Tenant (except in the event of an emergency,
when no prior notice will be required), may enter the Leased
Premises and view the condition thereof and the Tenant
covenants with the Landlord to repair, maintain and keep the
Leased Premises in good and substantial repair according to
notice in writing, reasonable wear and tear excepted;
provided, that the Landlord will use commercially reasonable
efforts to observe Tenant's reasonable security precautions.
If the Tenant shall fail to repair as aforesaid after
reasonable notice to do so, the Landlord may effect the
repairs and the Tenant shall pay the reasonable cost thereof
to the Landlord on demand. The Tenant covenants with the
Landlord that the Tenant will at the expiration of the Term or
sooner termination thereof peaceably surrender the Leased
Premises in good and substantial repair and condition,
reasonable wear and tear excepted.
Indemnifi- (d) If any part of the Property becomes out of repair,
cation damaged or destroyed through the negligence of, willful
misconduct or misuse by, the Tenant or its employees, agents,
invitees or others under its control, the Tenant shall pay the
Landlord on demand the expense of repairs or replacements,
including the Landlord's reasonable attorneys' fees and costs,
and court costs and administration charges thereof,
necessitated by such negligence, willful misconduct or misuse.
It is the intention of the parties hereto that the terms of
this Lease govern the respective obligations of the parties
hereto for the maintenance and repair of the Leased Premises,
and Tenant hereby expressly waives the benefits of any
statute, law and/or ordinance, now or hereafter in effect, to
the extent it is inconsistent with the terms of this Lease,
including, but not limited to, Tenant's right to make repairs
under Sections 1941 and 1942 of the California Civil Code.
Damage and (e) It is agreed between the Landlord and the Tenant that:
Destruction
(i) In the event of damage to the Property or to any
part thereof, if the damage is such that the Leased Premises
or any substantial part thereof is rendered not reasonably
capable of use and occupancy by the Tenant for the purposes of
its business for any period of time in excess of thirty (30)
days, then
(A) unless the damage was primarily caused by the
Tenant or its employees, agents, invitees or others under its
control, from the date of occurrence of the damage and until
the Leased Premises are again reasonably capable for use and
occupancy as aforesaid, the Rent payable pursuant to this
Lease shall xxxxx from time to time in proportion to the part
or parts of the
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Leased Premises not reasonably capable of such use and
occupancy, and
(B) unless this Lease is terminated as
hereinafter provided, the Landlord or the Tenant as the case
may be (according to the nature of the damage and their
respective obligations to repair as provided in sub-paragraphs
(a), (b) and (c) of this Paragraph 8) shall repair such damage
with all reasonable diligence, but to the extent that any part
of the Leased Premises is not reasonably capable of such use
and occupancy by reason of damage which the Tenant is
obligated to repair hereunder, any abatement of Rent to which
the Tenant would otherwise be entitled hereunder shall not
extend later than the time by which, in the reasonable opinion
of the Landlord, repairs by the Tenant ought to have been
completed with reasonable diligence; and
(ii) if the Leased Premises are substantially damaged
or destroyed by any cause and if in the reasonable opinion of
the Landlord, given in writing within thirty (30) days of the
occurrence the damage, cannot reasonably be repaired within
one hundred and eighty (180) days after the occurrence
thereof, then this Lease shall terminate, in which event
neither the Landlord nor the Tenant shall be bound to repair
as provided in sub-paragraphs (a), (b) and (c) of this
Paragraph 8, and the Tenant shall instead deliver up
possession of the Leased Premises to the Landlord with
reasonable expedition and Rent shall be apportioned and paid
to the date of the occurrence; and
(iii) if half or more of the total number of square
feet of rentable office area in the Property or half or more
of the total number of square feet of rentable office area in
the Building (as determined by the Landlord) or portions of
the Property which affect access or services essential
thereto, are substantially damaged or destroyed by any cause
and if in the reasonable opinion of the Landlord the damage
cannot reasonably be repaired within one hundred and eighty
(180) days after the occurrence thereof, then the Landlord
may, by written notice to the Tenant given within thirty (30)
days after the occurrence of such damage or destruction,
terminate this Lease, in which event neither the Landlord nor
the Tenant shall be bound to repair as provided in sub-
paragraphs (a) (b) and (c) of this Paragraph 8, and the Tenant
shall instead deliver up possession of the Leased Premises to
the Landlord with reasonable expedition but in any event
within sixty (60) days after delivery of such notice of
termination, and Rent shall be apportioned and paid to the
date upon which possession is so delivered up (but subject to
any abatement to which the Tenant may be entitled under sub-
paragraph(e) (i) of this Paragraph 8).
(iv) Landlord and Tenant hereby agree that the terms
of this Lease shall govern the effect of any damage to or the
destruction of the Leased Premises with respect to the
termination of this Lease, and hereby waive any present or
future statutes, ordinances and/or laws to the extent
inconsistent herewith, including but not limited to, Sections
1932(2) and 1933(4) of the
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California Civil Code.
9. INSURANCE AND LIABILITY
Landlord's (a) The Landlord shall take out and keep in force during the
insurance Term insurance with respect to the Property, except for the
Leasehold Improvements in the Leased Premises. The insurance
to be maintained by the Landlord shall be in respect of perils
and to amounts and on terms and conditions which, from time to
time, are insurable at a reasonable premium and which are
normally insured by reasonable prudent owners of properties
similar to the Property, all as from time to time determined
at reasonable intervals by insurance advisors selected by the
Landlord, and whose opinion shall be conclusive. Unless and
until the insurance advisors shall state that any such perils
are not customarily insured against by owners of properties
similar to the Property, the perils to be insured against by
the Landlord shall include, without limitation, public
liability, boilers and machinery, fire and extended perils,
and may include, at the option of the Landlord, losses
suffered by the Landlord through business interruption.
Notwithstanding anything to the contrary set forth in this
Lease, and without affecting the rights or remedies of the
parties hereto, Landlord and Tenant each hereby release and
relieve the other, and waive their right to recover damages
against each other, for loss of or damage to their respective
property arising out of or incident to the perils insured
against under this Paragraph 9. The effect of any such
releases and waivers is not limited by the amount of insurance
carried or by any deductible applicable hereto. Landlord and
Tenant hereby agree to have their respective insurance
carriers waive any right to subrogation that such carriers may
have against either Landlord or Tenant, as the case may be, so
long as any insurance is not invalidated thereby.
Tenant's (b) The Tenant shall take out and keep in force during the
Insurance Term:
(i) comprehensive Commercial General Liability insurance
on an all occurrence basis with respect to Tenant's business
carried on, in or from the Leased Premises and the Tenant's
use and occupancy of the Leased Premises and any other part of
the Property, with coverage for any one occurrence or claim of
not less than Two Million Dollars ($2,000,000.00) or such
other amount as the Landlord may reasonably require (but not
more often than once during each Fiscal Period) upon not less
than one (1) month's notice during the Term, which insurance
shall include the Landlord as a named insured and shall
protect the Landlord in respect of claims by the Tenant as if
the Landlord were separately insured;
(ii) insurance in respect of fire and such other perils as
are from time to time in the usual extended coverage
endorsement covering the Leasehold Improvements, trade
fixtures, and the furniture and equipment in the Leased
Premises for not less than the full replacement cost thereof,
and
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which insurance shall include the Landlord as a named insured
as the Landlord's interest may appear; and
(iii) insurance against such other perils and in such
amounts as the Landlord may from time to time reasonably
require (but not more often than once during each Fiscal
Period) upon not less than ninety (90) days' written notice,
such requirement to be made on the basis that the required
insurance is customary at the time for prudent tenants of
properties similar to the Property.
All insurance required to be maintained by the Tenant shall be
on terms and with insurers with a General Policy Holders
Rating of not less than "A:X" as rated in the most current
issue of "Best's Insurance Guide." Each policy shall contain a
waiver by the insurer of any rights of subrogation or
indemnity or any other claim to which the insurer might
otherwise be entitled, as set forth above, and shall also
contain an undertaking by the insurer that no material change
adverse to the Landlord or the Tenant will be made, and the
policy will not lapse or be cancelled, except after not less
than thirty (30) days' written notice to the Landlord of the
intended change, lapse or cancellation. The Tenant shall
furnish to the Landlord, if and whenever requested by it,
certificates or other evidence acceptable to the Landlord as
to the insurance from time to time effected by the Tenant and
its renewal or continuation in force, together with evidence
as to the method of determination of full replacement cost of
the Tenant's Leasehold Improvements, trade fixtures, furniture
and equipment, and if the Landlord reasonably concludes that
the full replacement cost has been underestimated, the Tenant
shall forthwith arrange for any consequential increase in
coverage required under sub-paragraph(b) of this Paragraph 9.
If the Tenant shall fail to take out, renew and keep in force
such insurance, or if the evidence submitted to the Landlord
is unacceptable to the Landlord (or no such evidence is
submitted within a reasonable period after request therefor by
the Landlord), then the Landlord may give to the Tenant
written notice requiring compliance with this sub-paragraph
and specifying the respects in which the Tenant is not then in
compliance with this sub-paragraph. If the Tenant does not
within forty-eight (48) hours provide appropriate evidence of
compliance with this subparagraph, the Landlord may (but shall
not be obligated to) obtain one or all of the additional
coverage or other insurance which the Tenant shall have failed
to obtain, without prejudice to any other rights of the
Landlord under this Lease or otherwise, and the Tenant shall
pay all premiums and other reasonable expenses incurred by the
Landlord upon demand. Notwithstanding anything to the contrary
set forth in this Paragraph 9(b) and/or elsewhere in this
Lease, and in the event that the Tenant fails to obtain and
maintain the insurance required under this Paragraph 9 and/or
otherwise in this Lease for any reason whatsoever, the Tenant
shall be conclusively deemed to have self-insured such
insurance obligations with the full waiver of subrogation set
forth in Paragraph 9(a) of this Lease; provided, however,
nothing contained herein grants to the Tenant the right or
option to self-insure the Tenant's
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insurance obligations under this Lease.
Limitation of (c) The Tenant agrees that the Landlord shall not be liable
Landlord's for any bodily injury or death of, or loss or damage to any
Liability property belonging to, the Tenant or its employees, invitees
or licensees or any other person in, on or about the Property,
unless resulting from the actual willful misconduct or
negligence of the Landlord or its own employees. In no event
shall the Landlord be liable for any damage which is caused by
steam, water, rain or snow or other thing which may leak into,
issue or flow from any part of the Property or from the pipes
or plumbing works, including the sprinkler system (if any)
therein or from any other place or for any damage caused by or
attributable to the condition or arrangement of any electric
or other wiring or of sprinkler heads (if any) or for any
damage caused by anything done or omitted by any other tenant.
Notwithstanding anything to the contrary set forth in this
Lease, the obligations of the Landlord, and the Landlord's
partners (either general or limited), directors, officers and
shareholders, under this Lease, do not constitute personal
obligations. Tenant, and the Tenant's successors and assigns,
hereby agree not to seek any recourse against the personal
assets of the Landlord, or the Landlord's partner (either
general or limited), directors, officers and shareholders, for
the satisfaction of any actual or alleged liability of
Landlord to Tenant under this Lease, but Tenant shall look
only to the Landlord's interest in the Property for the
satisfaction of any liability of Landlord to Tenant hereunder.
Indemnity of (d) Except with respect to claims or liabilities in respect
Landlord of any damage which is Insured Damage to the extent of the
cost of repairing such Insured Damage, the Tenant agrees to
indemnify, defend (with counsel reasonably acceptable to
Landlord) and hold harmless the Landlord and the Property in
respect of:
(i) all claims for bodily injury or death, property
damage or other loss or damage arising from the conduct of any
work or any act or omission of the Tenant or any assignee,
sub-tenant, agent, employee, contractor, invitee or licensee
of the Tenant, and in respect of all costs, expenses and
liabilities incurred by the Landlord in connection with or
arising out of all such claims, including the expenses of any
action or proceeding pertaining thereto; and
(ii) any reasonable loss, cost (including, without
limitation, reasonable attorneys' fees and costs, and court
costs), expense or damage suffered by the Landlord arising
from any breach by the Tenant of any of its covenants and
obligations under this Lease.
Definition of (e) For purposes of this Lease, "Insured Damage" means
"Insured that part of any damage occurring to the Property of which
Damage" the entire cost of repair (or the entire cost of repair other
than deductible amount properly collectable by the Landlord as
part of the Additional Rent) is actually recovered by the
Landlord
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under a policy or policies of insurance from time to time
effected by the Landlord pursuant to sub-paragraph(a) of this
Paragraph 9. Where an applicable policy of insurance contains
an exclusion for damages recoverable from a third party,
claims as to which the exclusion applies shall be considered
to constitute Insured Damage only if the Landlord successfully
recovers from the third party.
10. EVENTS OF DEFAULT AND REMEDIES
Events of (a) In the event of the happening of any one of the
Default and following events:
Remedies
(i) the Tenant shall have failed to pay any Basic
Rent, Additional Rent or any other Rent when due, and such
failure shall be continuing for a period of more than five (5)
days after Tenant's receipt of Landlord's written notice of
late payment;
(ii) there shall be a default of or with any
condition, covenant, agreement or other obligation on the part
of the Tenant to be kept, observed or performed hereunder
(other than a condition, covenant, agreement or other
obligation to pay Basic Rent, Additional Rent or any other
Rent) and such default shall be continuing for a period of
more than thirty (30) days after written notice by the
Landlord to the Tenant specifying the default and requiring
that it discontinue;
(iii) if any policy of insurance upon the Property or
any part thereof from time to time effected by the Landlord
shall be cancelled or about to be cancelled by the insurer by
reason of the use or occupation of the Leased Premises by the
Tenant or any assignee, sub-tenant or licensee of the Tenant
or anyone permitted by the Tenant to be upon the Leases
Premises, and the Tenant, after receipt of notice in writing
from the Landlord, shall have failed to take such immediate
steps in respect of such use or occupation as shall enable the
Landlord to reinstate or avoid cancellation (as the case may
be) of such policy of insurance;
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(iv) the Leased Premises shall, without the prior
written consent of the Landlord, be used by any other persons
than the Tenant or its permitted assigns or sub-tenants or for
any purpose other than that for which they were leased or
occupied or by any persons whose occupancy is prohibited by
this Lease;
(v) the Leased Premises shall be vacated or
abandoned, and the Tenant shall have failed to pay any Basic
Rent, Additional Rent or any other Rent when due;
(vi) the balance of the Term of this Lease or any of
the goods and chattels of the Tenant located in the Leased
Premises, shall at any time be seized in execution or
attachment; or
(vii) the Tenant shall make any assignment for the
benefit of creditors or become bankrupt or insolvent or take
the benefit of any statute for bankrupt or insolvent debtors
or, if a corporation, shall take any steps or suffer any order
to be made for its winding-up or other termination of its
corporate existence, or if a trustee, receiver or receiver-
manager or agent or other like person shall be appointed for
any of the assets of the Tenant,
then the Landlord shall have the following rights and
remedies, all of which are cumulative and not alternative and
not to the exclusion of any other or additional rights and
remedies in law or equity available to the Landlord by statute
or otherwise:
(A) to remedy or attempt to remedy any default of the
Tenant, and in so doing to make any payments due or alleged to
be due by the Tenant to third parties and to enter upon the
Leased Premises to do any work or other things therein, and in
such event all reasonable expenses of the Landlord in
remedying or attempting to remedy such default shall be
payable by the Tenant to the Landlord on demand;
(B) with respect to unpaid overdue Rent (beginning
with the period five (5) days after Tenant's receipt of
Landlord's written notice of late payment), the payment by the
Tenant of the Rent and of interest (which said interest shall
be deemed included herein in the term "Rent") thereon at a
rate equal to the lesser of (i) three percent (3%) above the
prime commercial loan rate charged to borrowers having the
highest credit rating form time to time by the Landlord's
principal bank from the date upon which the same was due until
actual payment thereof, or (ii) the maximum amount allowed
under the laws of the jurisdiction in which the Building is
located;
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(C) to terminate this Lease forthwith and the Tenant's
right to possession of the Leased Premises by any lawful
means, in which case this Lease shall terminate and the Tenant
shall immediately surrender possession to the Landlord, and
thereafter the Landlord shall be entitled to recover any and
all of Landlord's unpaid Rent and damages as are recoverable,
or Landlord may reserve the right to recover all or any part
thereof in a separate suit, as now or hereafter available
under the laws or judicial decisions of the jurisdiction in
which the Building is located;
(D) to enter the Leased Premises as agent of the Tenant
and as such agent to re-let them and to receive the rent
therefor and as the agent of the Tenant to take possession of
any furniture or other property thereon and upon giving ten
(10) business days' written notice to the Tenant to store the
same at the expense and risk of the Tenant or to sell or
otherwise dispose of the same at public or private sale
without further notice and to apply the proceeds thereof and
any rent derived from re-letting the Leased Premises upon
account of the Rent due and to become due under this Lease and
the Tenant shall be liable to the Landlord for the deficiency,
if any; and
(E) pursue any remedy now or hereafter available under
the laws or judicial decisions of the jurisdiction in which
the Building is located (including, but not limited to,
California Civil Code Section 1951.4 (where a landlord may
continue a lease in effect after a tenant's breach and recover
rent as it becomes due, if the tenant has the right to sublet
or assign, subject only to reasonable limitations)). The
expiration and termination of this Lease and/or the
termination of the Tenant's right to possession shall not
relieve the Tenant from liability under any indemnity
provisions of this Lease as to matters occurring or accruing
during the Term or by reason of the Tenant's occupancy of the
Leased Premises.
Payment of (b) Upon the giving by the Landlord of a notice in writing
Rent, etc. on terminating this Lease under sub-paragraph (a)(C) of this
Termination Paragraph 10, this Lease and the Term shall terminate, Rent
and any other payments for which the Tenant is liable under
this Lease shall be computed, apportioned and paid in full to
the date of such termination forthwith, and there shall
immediately become due and payable forthwith in one lump sum,
and not as a penalty, the aggregate of all Rent (as estimated
by the Landlord, acting reasonably) due and payable to the
Landlord.
Attorneys' (c) The Tenant shall pay to the Landlord on demand all
Fees reasonable costs and expenses, including attorneys' fees and
costs, and court costs, incurred by the Landlord in enforcing
any of the obligations of the Tenant under this Lease.
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ADDITIONAL PROVISIONS
Relocation of 11. [Intentionally Deleted].
leased Premises
Subordination 12. This Lease and all rights of the Tenant hereunder are
and Attornment subject and subordinate to all underlying leases and charges,
or mortgages now or hereafter existing (including charges, and
mortgages by way of debenture, note, bond, deeds of trust and
mortgage, and all instruments supplemental thereto), which may
now or hereafter affect the Property or any part thereof and
to all renewals, modifications, consolidations, replacements
and extensions thereof provided the lessor, chargee, mortgagee
or trustee agrees to accept this Lease if not in default; and
in recognition of the foregoing the Tenant agrees that it
will, whenever requested, attorn to such lessor, chargee,
mortgagee as a tenant upon all the terms of this Lease. The
Tenant agrees to execute promptly whenever requested by the
Landlord or by the holder of any such lease, charge, or
mortgage an agreement of Subordination, Nondisturbance and
Attornment (the "SNDA"), as may be reasonably required of it.
Landlord hereby represents and warrant to Tenant that, prior
to the Commencement Date, there are no underlying ground
leases, mortgages or deeds of trust encumbering the Property,
including the Building and the Leased Premises. In
consideration of and as a condition precedent to Tenant's
agreement to be bound by this Xxxxxxxxx 00, Xxxxxxxx shall use
good-faith efforts and diligence to provide Tenant with a
commercially reasonable SNDA from a subsequent ground lessor,
mortgage holder or beneficiary under a deed of trust
respecting the Property, who later may come into existence
during the Term. Tenant hereby expressly waives the provisions
of any statute, rule or law which may give or purport to give
Tenant the right or election to terminate or otherwise
adversely affect this Lease and the obligations of Tenant
hereunder solely in the event of any foreclosure proceeding or
sale, and Tenant hereby agrees that this Lease shall not be
affected in any way whatsoever by any such foreclosure
proceeding or sale.
Certificates 13. The Tenant agrees that it shall, as requested by the
Landlord (but not more often then twice during each Fiscal
Period), execute and deliver to the Landlord, and if required
by the Landlord, to any lessor, chargee, or mortgagee
(including any trustee) or other person designated by the
Landlord, a reasonable acknowledgment in writing as to the
then-status of this Lease, including as to whether it is in
full force and effect, is modified or unmodified, confirming
the Basic Rent and Additional Rent payable hereunder and the
status of the account between Landlord and the Tenant, the
existence or non-existence of defaults, and any other matters
pertaining to this Lease as to which the Landlord shall
request an acknowledgment.
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Inspection of 14. The Landlord shall be permitted, at any time and from
and Access to time to time, to enter and to have its authorized agents,
the Leased employees and contractors enter the Leased Premises for the
Premises purposes of inspection, window cleaning, maintenance, making
repairs, alterations or improvements to the Leased Premises or
the Property, or to have access to utilities and services
(including all ducts and access panels (if any), which the
Tenant agrees not to obstruct) and the Tenant shall provide
free and unhampered access for the purpose, and shall not be
entitled to compensation for any inconvenience, nuisance or
discomfort caused thereby. The Landlord and its authorized
agents and employees shall be permitted entry to the Leased
Premises for the purpose of exhibiting them to prospective
tenants. The Landlord in exercising its rights under this
Paragraph 14 shall do so to the extent reasonable necessary so
as to minimize interference with the Tenant's use and quiet
enjoyment of the Leased Premises, subject to the terms of this
Lease (specifically including Paragraph 8(c) above); provided,
that in an emergency, the Landlord or persons authorized by it
may enter the Leased Premises, at any time, without regard to
minimizing interference.
Delay 15. Except as herein otherwise expressly provided, if and
whenever and to the extent that either the Landlord or the
Tenant shall be prevented, delayed or restricted in the
fulfillment of any obligation hereunder in respect of the
supply or provision of any service or utility, the making of
any repair, the doing of any work or any other thing (other
than the payment of any monies required to be paid by the
Tenant to the Landlord under this Lease by reason of:
(a) strikes or work stoppages;
(b) being unable to obtain any material, service,
utility or labor required to fulfill such obligation;
(c) any statute, law or regulation of, or inability to
obtain any permission from any governmental authority having
lawful jurisdiction preventing, delaying or restricting such
fulfillment;
or
(d) other unavoidable occurrence,
the time for fulfillment of such obligation shall be extended
during the period in which such circumstance operates to
prevent, delay or restrict the fulfillment thereof, and the
other party to this Lease shall not be entitled to
compensation for any inconvenience, nuisance or discomfort
thereby occasioned; provided, that nevertheless the Landlord
will use commercially reasonable efforts to maintain services
essential to the use and enjoyment of
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the Leased Premises; and provided further, that if the
Landlord shall be prevented, delayed or restricted in the
fulfillment of any such obligation hereunder by reason of any
of the circumstances set out in sub-paragraph (c) of this
Paragraph 15 and to fulfill such obligation could not, in the
reasonable opinion of the Landlord, be completed without
substantial additions to or renovations of the Property, the
Landlord may on sixty (60) days' written notice to the Tenant
terminate this Lease.
Waiver 16. If either the Landlord or the Tenant shall overlook,
excuse, condone or suffer any default, breach, non-observance,
improper compliance or non-compliance by the other of any
obligation hereunder, this shall not operate as a waiver of
such obligation in respect of any continuing or subsequent
default, breach, or non-observance, and no such waiver shall
be implied but shall but shall only be effective if expressed
in writing and executed by the waiving party.
Sale, 17. (a) The term "Landlord" as used in this Lease, means
Demolition and only the owner for the time being of the Property, so that in
Renovation the event of any sale or sales, transfer or transfers of the
Property, or the making of any lease or leases thereof, or the
sale or sales or the transfer or transfers or the assignment
or assignments of any such lease or leases; previous landlords
shall be and hereby are relieved of all covenants and
obligations of Landlord hereunder for the period of time after
any such sale, transfer, etc. It shall be deemed and construed
without further agreement between the parties, or their
successors in interest, or between the parties and the
transferee or acquiror, at any such sale, transfer or
assignment, or lessee on the making of any such lease, that
the transferee, acquiror or lessee has assumed and agreed to
carry out any and all of the covenants and obligations of
Landlord hereunder to Landlord's exoneration, and Tenant shall
thereafter be bound to and shall attorn to such transferee,
acquiror or lessee, as the case may be, as Landlord under this
Lease, subject to the terms of paragraph 12 above.
(b) [Intentionally Deleted].
Public Taking 18. The Landlord and Tenant shall cooperate, each with the
other, in respect of any "Public Taking" (as hereinafter
defined) of the Leased premises or any part thereof so that
the Tenant may receive the maximum award to which it is
entitled in law for relocation costs, business interruption
and loss of goodwill, if any, and so that the Landlord may
receive the maximum award for al other compensation arising
from or relating to such Public Taking (including all
compensation for the value of the Tenant's leasehold interest
subject to the Public Taking) which shall be the property of
the Landlord, and the Tenant's rights to such compensation are
hereby assigned to the Landlord. If the whole or any part of
the Leased Premises is Publicly Taken, as between the parties
hereto, their respective rights and obligations under this
Lease shall continue until the day on which the Public Taking
authority takes possession
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thereof. If the whole or any part of the Leased Premises is
Publicly Taken, the Landlord shall have the option, to be
exercised by written notice to the Tenant, to terminate this
Lease and such termination shall be effective on the day the
Public Taking authority takes possession of the whole or the
portion of the Property. Rent and all other payments shall be
adjusted as of the date of such termination and the Tenant
shall, on the date of such Public Taking, vacate the Leased
Premises and surrender the same to the Landlord, with the
Landlord having the right to re-enter and re-possess the
Leased Premises discharged of this Lease and to remove all
persons therefrom. In this Paragraph 18, the words "Public
Taking" shall include expropriation and condemnation and shall
include a sale by the Landlord to an authority with powers of
expropriation, condemnation or taking, in lieu of or under
threat of expropriation or taking, and "Publicly Taken" shall
have a corresponding meaning. The Tenant hereby waives any and
all rights the Tenant might otherwise have pursuant to
Sections 1265.110, 1265.120 and 1265.130 of the California
Code of Civil Procedure and any successor sections or
statutes.
Registration of 19. The Tenant agrees with the Landlord not to register or
Lease record this Lease in any recording office and not to register
or record notice of this Lease in any form without the prior
written consent of the Landlord. If such consent is provided
such notice of Lease or caveat shall be in such form as the
Landlord shall have approved and upon payment of the
Landlord's reasonable fee for same and all applicable transfer
or recording taxes or charges. The Tenant shall remove and
discharge, at Tenant's expense, registration or recordation of
such a notice at the Expiration Date or earlier termination of
the Term, and in the event of Tenant's failure to so remove or
discharge such notice after ten (10) days' written notice by
Landlord to Tenant, the Landlord may in the name and on behalf
of the Tenant execute a discharge of such a notice in order to
remove and discharge such notice and for the purpose thereof
the Tenant hereby irrevocably constitutes and appoints any
officer of the Landlord the true and lawful attorney of the
Tenant.
Lease Entire 20. The Tenant acknowledges that there are no covenants,
Agreement representations, warranties, agreements or conditions, express
or implied, collateral or otherwise forming part of or in any
way affecting or relating to this Lease, save as expressly set
out in this Lease and the Schedules attached hereto, and that
this Lease and such Schedules constitute the entire agreement
between the Landlord and the Tenant and may not be modified
except as herein explicitly provided or except by agreement in
writing executed by the Landlord and the Tenant.
Notices 21. Any notice, advice, document or writing required or
contemplated by any provision hereof shall be given in writing
and if to the Landlord, either delivered or mailed by prepaid
mail addressed to the Landlord at the said local office
address of the Landlord shown above, and if to the Tenant,
either delivered personally to the Tenant (or to an officer of
the Tenant, if a
INITIAL
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Landlord Tenant
23
corporation) or mailed by prepaid mail addressed to the Tenant
at the Leased Premises, or if an address of the Tenant is
shown in the description of the Tenant above, to such address.
Every such notice, advice, document or writing shall be deemed
to have been given when delivered personally, or if mailed as
aforesaid, upon the fifth day after being mailed. The Landlord
may from time to time by notice in writing to the Tenant
designate another address as the address to which notices are
to be mailed to it, or specify with greater particularity the
address and persons to which such notices are to be mailed and
may require that copies of notices be sent to an agent
designated by it. The Tenant may, if an address of the Tenant
is shown in the description of the Tenant above, from time to
time by notice in writing to the Landlord, designate another
address as the address to which notices are to be mailed to
it, or specify with greater particularity the address to which
such notices are to be mailed.
Interpretation 22. In this Agreement "herein", "hereof", "hereby",
"hereunder", "hereto", "hereinafter" and similar expressions
refer to this Lease and not to any particular paragraph,
clause or other portion thereof, unless there is something in
the subject matter or context inconsistent therewith; and the
parties agree that all of the provisions of this Lease are to
be construed as covenants and agreements as though words
importing such covenants and agreements were used in each
separate paragraph hereof, and that should any provision or
provisions of this Lease be illegal or not enforceable it or
they shall be considered separate and severable from the Lease
and its remaining provisions shall remain in force and be
binding upon the parties hereto as though the said provision
or provisions had never been included, and further that the
captions appearing for the provisions of this Lease have been
inserted as a matter of convenience and for reference only and
in no way define, limit or enlarge the scope or meaning of
this Lease or of any provisions hereof. Furthermore, this
Lease shall be construed without regard to any presumption or
other rule requiring construction against the party drafting a
document and shall be construed neither for nor against either
the Landlord or the Tenant, but shall be given a reasonable
interpretation in accordance with the plain meaning of its
terms and the intent of the parties hereto.
Extent of Lease 23. This Agreement and everything herein contained shall
Obligations inure to the benefit of and be binding upon the respective
heirs, executors, administrators, successors, assigns and
other legal representatives, as the case may be, of each and
every of the parties hereto, subject to the granting of
consent by the Landlord to any assignment or sublease, and
every reference herein to any party hereto shall include the
heirs, executors, administrators, successors, assigns and
other legal representatives of such party, and where there is
more than one tenant or there is a male or female party the
provisions hereof shall be read with all grammatical changes
thereby rendered necessary and all covenants shall be deemed
joint and several hereunder.
INITIAL
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Landlord Tenant
24
Use and 24. If the Tenant shall for any reason use or occupy the
Occupancy Leased Premises in any way prior to the Commencement Date, and
Prior to Term with there being this Lease or other agreement between the
Landlord and Tenant in place, then during such prior use or
occupancy the Tenant shall be a Tenant of the Landlord and
shall be subject to the same covenants and agreements as set
forth in this Lease. See Schedule "I" attached hereto.
------------
Time of 25. Except as otherwise expressly provided in Paragraph 15
Essence of this Lease, time is of the essence with respect to the
performance of all obligations to be performed or observed by
the parties hereto.
Choice of Law 26. This Lease shall be construed and enforced in
accordance with the laws of the State of California. Landlord
and Tenant hereby consent and agree to the jurisdiction of the
state or federal courts sitting in the County of Los Angeles,
State of California, and waive any objection based on venue or
forum non conveniens with respect to any action instituted
therein, and further agree that any dispute concerning the
relationship between the parties hereto or this Lease, or
otherwise, shall be heard only in the courts described above.
Auctions 27. The Tenant shall not conduct, nor permit to be
conducted, any auction upon the Leased Premises and/or the
Property without the Landlord's prior written consent, which
consent shall be at the Landlord's sole and absolute
discretion.
Termination 28. Unless specifically stated otherwise in writing by the
and Merger Landlord, any expiration or earlier termination of this Lease
shall automatically terminate any sublease or lesser estate in
the Leased Premises; provided, however, that the Landlord may
elect to continue any one or all existing subtenancies.
Landlord's failure, within thirty (30) days following such
expiration or termination to elect to the contrary by written
notice to the holder of any such lesser estate or interest
shall constitute the Landlord's election to have such
expiration or termination constitute the termination of such
lesser estate or interest.
Reservations 29. Landlord reserves to itself the right, from time to
time, to grant any such easements, rights, and dedications
that the Landlord deems necessary, and to cause a recordation
of parcel maps and restrictions, so long as such easements,
rights, dedications and restrictions do not unreasonably
interfere with the use of the Leased Premises by the Tenant.
The Tenant hereby agrees, at the Tenant's cost and expense, to
sign any documents reasonably requested by Landlord to
effectuate any such easements, rights, dedications, maps or
restrictions.
Schedules 30. The provisions of the following Schedules attached
hereto shall form a part of this Lease as if the same were
embodied herein:
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Landlord Tenant
25
Schedule "A" Legal Description of Property
Schedule "B-1" Outline of Leased Premises
Schedule "B-2" Outline of Opportunity Space
Schedule "C" Taxes Payable by Landlord and Tenant
Schedule "D" Services and Costs
Schedule "E" Rules and Regulations
Schedule "F" Leasehold Improvements
Schedule "G" Tenant Improvement Allowance
Schedule "H" Option to Renew
Schedule "I" Occupancy Prior to Commencement Date
Schedule "J" [Intentionally Deleted]
Schedule "K" Increases in Basic Rent
Schedule "L" Right of First Opportunity to Lease
Schedule "M" Letter of Credit
Schedule "N" Miscellaneous
Parking Agreement
[Remainder of this page intentionally left blank]
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Landlord Tenant
26
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the date
set forth on page 1 hereof.
Landlord:
THE MANUFACTURERS LIFE INSURANCE
COMPANY (U.S.A.),
a Michigan corporation
By:____________________________________
Name:______________________________
Title:_____________________________
Tenant:
EXODUS COMMUNICATIONS, INC.,
a California corporation
By:_____________________________________
Name: Xxxxxxx Xxxxx
Title: Chief Operating Officer and
Chief Financial Officer
INITIAL
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Landlord Tenant
27
SCHEDULE "A"
LEGAL DESCRIPTION OF PROPERTY
The Property is located in the City of Irvine, County of Orange, State of
California, and is more particularly described as follows:
Parcel 1:
Parcel 28 in the City of Irvine, County of Orange, State of
California, as shown on Parcel Map No. 83-0613 filed May 29, 1984 in Book 188,
Pages 28-33 of Parcel Maps, in the office of the County Recorder of said County.
Parcel 2:
An undivided 4.910 interest in Xxxx X, X, X, X, X, X and H in the City
of Irvine, County of Orange, State of California, as shown on Parcel Map No. 83-
0613 filed May 29, 1984 in Book 188, Pages 28-33 of Parcel Maps, in the office
of the County Recorder of said County.
Excepting from Parcels 1 and 2 any and all oil, oil rights, mineral,
mineral rights, natural gas rights, and other hydrocarbons by whatsoever name
known, geothermal steam or other resources, and all products derived from any of
the foregoing, that may be within or under the land, together with the perpetual
right of drilling, mining or exploring and operating therefor and storing in and
removing the same from the land or any other land, including the right to
whipstock or directionally drill and mine from the lands other than those
conveyed hereby, oil or gas xxxxx, tunnels and shafts into, through or across
the subsurface of the land, and to bottom such whipstocked or directionally
drilled xxxxx, tunnels and shafts under and beneath or beyond the exterior
limits thereof, and to redrill, retunnel, equip, maintain, repair, deepen and
operate any such xxxxx or mines; without, however, the right to drill, mine,
store, explore and operate through the surface of the upper five hundred (500)
feet of the subsurface of the land, as reserved by The Irvine Company in deed
recorded December 27, 1985 as Instrument No. 85-519768 of Official Records.
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Landlord Tenant
A-1
SCHEDULE "A"
LEGAL DESCRIPTION OF PROPERTY
The Property is located in the City of Irvine, County of Orange, State of
California, and is more particularly described as follows:
Parcel 1:
Parcel 28 in the City of Irvine, County of Orange, State of California, as
shown on Parcel Map No. 83-0613 filed May 29, 1984 in Book 188, Pages 28-33 of
Parcel Maps, in the office of the County Recorder of said County.
Parcel 2:
An undivided 4.910 interest in Xxxx X, X, X, X, X, X and H in the City of
Irvine, County of Orange, State of California, as shown on Parcel Map No. 83-
0613 filed May 29, 1984 in Book 188, Pages 28-33 of Parcel Maps, in the office
of the County Recorder of said County.
Expecting from Parcels 1 and 2 any and all oil, oil rights, minerals,
mineral rights, natural gas rights, and other hydrocarbons by whatsoever name
known, geothermal steam or other resources, and all products derived from any of
the foregoing, that may be within or under the land, together with the perpetual
right of drilling, mining or exploring and operating therefor and storing in and
removing the same from the land or any other land, including the right to
whipstock or directionally drill and mine from the lands other than those
conveyed hereby, oil or gas xxxxx, tunnels and shafts into, through or across
the subsurface of the land, and to bottom such whipstocked or directionally
drilled xxxxx, tunnels and shafts under and beneath or beyond the exterior
limits thereof, and to redrill, retunnel, equip, maintain, repair, deepen and
operate any such xxxxx or mines; without, however, the right to drill, mine,
store, explore and operate through the surface of the upper five hundred (500)
feet of the subsurface of the land, as reserved by The Irvine Company in deed
recorded December 27, 1985 as Instrument No. 85-519768 of Official Records.
A-1
SCHEDULE "B-1"
OUTLINE OF LEASED PREMISES
[GRAPHIC APPEARS HERE]
B-1
SCHEDULE "B-2"
OUTLINE OF OPPORTUNITY SPACE
[GRAPHIC APPEARS HERE]
B-2
SCHEDULE "C"
TAXES PAYABLE BY LANDLORD AND TENANT
TENANT'S TAXES 1. (a) The Tenant covenants to pay all of
"Tenant's Taxes" (as hereinafter
defined), as and when the same become due
and payable. Where any Tenant's Taxes are
payable by the Landlord to the relevant
taxing authorities, the Tenant covenants
to pay the amount thereof to the
Landlord.
(b) The Tenant covenants to pay to Landlord
the Tenant's Proportionate Share of the
excess of the amount of the "Landlord's
Taxes" (as hereinafter defined) in each
Fiscal Period over the Landlord's Taxes
in the "Base Year" (as hereinafter
defined).
(c) The Tenant covenants to pay to Landlord
the Tenant's Proportionate Share of the
costs and expenses (including attorneys'
and other professional fees, and interest
and penalties on deferred payments)
incurred in good-faith by the Landlord in
contesting, resisting or appealing any of
the "Taxes" (as hereinafter defined),
subject to Tenant's audit rights set
forth in Paragraph 3(f) of this Lease.
LANDLORD'S TAXES (d) The Landlord covenants to pay Landlord's
Taxes subject to the payments on account
of Landlord's Taxes required to be made
by the Tenant elsewhere in this Lease.
The Landlord may appeal any official
assessment or the amount of any Taxes or
other taxes based on such assessment and
relating to the Property. In connection
with any such appeal, the Landlord may
defer payment of any Taxes or other
taxes, as the case may be, payable by it
to the extent permitted by law, and the
Tenant shall cooperate with the Landlord
in connection with any such appeal.
SEPARATE (e) In the event that the Landlord is unable
ALLOCATION to obtain from the taxing ALLOCATION
authorities any separate allocation of
Landlord's Taxes, Tenant's Taxes or
assessments as required by the Landlord
to make calculations of Additional Rent
under this Lease, such allocation shall
be made by the Landlord acting
reasonably, and shall be subject to
Tenant's audit rights set forth in
Paragraph 3(f) of this Lease.
INFORMATION (f) Whenever requested by the Landlord, the
Tenant shall deliver to it receipts for
payment of all the Tenant's Taxes and
furnish such other information in
connection therewith as the Landlord may
reasonably require.
TAX ADJUSTMENT (g) If the Building has not been taxed as a
completed and fully occupied building for
the Base Year, the Landlord's Taxes will
be determined by the Landlord as if the
Building had been taxed as a completed
and fully occupied building for any such
Fiscal Period.
DEFINITION 2. In this Lease:
(a) "Landlord's Taxes" shall mean the
aggregate of all Taxes attributable to
the Property, the Rent or the Landlord in
respect thereof, including, without
limitation, any amounts imposed,
assessed, levied or charged in
substitution for or in lieu of any such
Taxes, but excluding such taxes as
capital gains taxes, corporate income,
profit or excess profit, estate or
inheritance taxes to the extent such
taxes are not levied in lieu of any of
the foregoing against the Property or the
Landlord in respect thereof;
(b) "Taxes" shall mean all taxes, rates,
duties, levies, fees, charges, local
improvement rates, capital taxes, rental
taxes and assessments whatsoever,
including fees, rents, and levies for air
rights and encroachments on or over
municipal property imposed, assessed,
levied or charged by any school,
municipal, regional, state, provincial,
federal, parliamentary or other body,
corporation, authority, agency or
commission, or resulting from any sale,
refinancing or change of ownership of all
or any portion of the Property; provided,
that any such local improvements rates,
assessed and paid prior to or in the Base
Year shall be excluded from the Base Year
and any year during the Term; and
provided further, that "Taxes" shall not
include any special utility, levies, fees
or charges imposed, assessed, levied or
charged which are directly associated
with initial construction of the
Property.
(c) "Tenant's Taxes" shall mean the
aggregate of:
(i) all Taxes (whether imposed upon
the Landlord or the Tenant)
attributable to the personal
property, trade fixtures,
business, income, occupancy or
sales of the Tenant or any other
occupant of the Leased Premises,
and to any Leasehold
Improvements or fixtures
installed by or on behalf of the
Tenant within the Leased
Premises, and to the use by the
Tenant of any of the Property;
and
C-1
(ii) the amount by which Taxes
(whether imposed upon the
Landlord or the Tenant) are
increased above the Taxes which
would have otherwise been
payable as a result of the
Leased Premises or the Tenant or
any other occupant of the Leased
Premises being taxed or assessed
in support of separate schools;
and
(d) "Tenant's Proportionate Share" shall mean
fifty-one percent (51%), subject to
adjustment as determined solely by the
Landlord and notified to the Tenant in
writing for physical increases or decreases
in the total rentable area of the Property;
provided, that total rentable area of the
Property and the rentable area of the Leased
Premises shall exclude areas designated
(whether or not rented) for parking and for
storage.
(e) "Base Year" shall mean calendar year 1998.
C-2
SCHEDULE "D"
SERVICES AND COSTS
INTERIOR CLIMATE 1. The Landlord covenants with the Tenant:
CONTROL
(a) [Intentionally Deleted.]
JANITOR SERVICE (b) To provide, five (5) days per week,
janitor and cleaning services to the
common areas of the Building only,
consisting of reasonable services in
accordance with the standards of
similar office buildings;
ELEVATORS, (c) To keep available the following
LOBBIES, ETC. facilities for use by the Tenant and
its employees and invitees in common
with other persons entitled thereto:
(i) passenger and freight elevator
service to each floor upon which
the Leased Premises are located
provided such service is
installed in the Building and
provided that the Landlord may
prescribe the hours during which
and the procedures under which
freight elevator service shall
be available and may limit the
number of elevators providing
service outside normal business
hours;
(ii) common entrances, lobbies,
stairways and corridors giving
access to the Building and the
Leased premises, including such
other areas from time to time
which may be provided by the
Landlord for common use and
enjoyment within the Property;
(iii) the washrooms as the Landlord
may assign from time to time
which are standard to the
Building, provided that the
Landlord and the Tenant
acknowledge that, where an
entire floor is leased to the
Tenant or some other tenant, the
Tenant or such other tenant, as
the case may be, may exclude
others from the washrooms
thereon.
ELECTRICITY 2. The Landlord covenants with the Tenant to
furnish electricity to the Leased Premises
(except areas of the Leased Premises which have
separate meters) for normal office use for
lighting and for office equipment capable of
operating from the circuits available to the
Leased Premises and standard to the Building
twenty-four (24) hours per day, seven (7) days
per week, subject to governmental regulations;
(a) The amount of electricity consumed on
the Leased Premises in excess of
electricity required by the Tenant for
normal office use shall be as
determined by the Landlord acting
reasonably or by a metering device
installed by the Tenant at the
Tenant's expense (except as otherwise
provided in this Lease). The Tenant
shall pay the Landlord for all
electricity on demand or as otherwise
set forth herein.
(b) The Tenant covenants to pay to the
Landlord the Tenant's Proportionate
Share of all electricity consumed on
the Property (except the amounts
recovered from and paid by tenants
separately metered), and except as
related to the Leased Premises.
(c) In calculating electricity costs for
any Fiscal Period, if less than one
hundred percent (100%) of Building is
occupied by tenants, then the amount
of such electricity costs shall be
deemed for the purposes of this
Schedule "D" to be increased to an
-----------
amount equal to the like electricity
costs which normally would be expected
by the Landlord to have been incurred
had such occupancy been one hundred
percent (100%) during such entire
period.
3. The Landlord shall maintain and keep in repair
the facilities required for the systems(s) for
heating and cooling, filtering and circulation
air ("HVAC") (but not HVAC in, or servicing,
the Leased Premises), elevator (if installed in
the Building), and other services referred to
in sub-paragraphs (b) and (c) of Paragraph 1
and sub-paragraph (a) of Paragraph 2 of this
Schedule "D" in accordance with the standards
-----------
of office buildings similar to the Building,
but reserves the right to stop the use of any
of these facilities and the supply of the
corresponding services when necessary by reason
of accident or breakdown or during the making
of repairs, alterations or improvements shall
have been completed to the satisfaction of the
Landlord
ADDITIONAL 4. (a) The Landlord may (but shall not be
SERVICES obligated to ), on request of the
Tenant, supply services or materials
to the Leased Premises and the
Property which are not provided for
under this Lease and which are used by
the Tenant (the "Additional
Services"), including, without
limitation:
(i) replacement of non-Building
standard tubes and ballasts;
(ii) carpet shampooing;
(iii) drapery cleaning;
(iv) locksmithing;
(v) removal of bulk garbage;
(vi) picture hanging; and
(vii) special security arrangement.
D-1
(b) When Additional Services are supplied
or furnished by the Landlord, accounts
therefor shall be rendered by the
Landlord and shall be payable by the
Tenant to the Landlord, within thirty
(30) days after demand therefor as
Rent under this Lease. In the event
the Landlord shall elect not to supply
or furnish Additional Services, only
persons with prior written approval by
the Landlord (which approval shall not
be unreasonably withheld) shall be
permitted by the Landlord or the
Tenant to supply or furnish Additional
Services to the Tenant and the
supplying and furnishing shall be
subject to the reasonable rules fixed
by the Landlord with which the Tenant
undertakes to cause compliance and to
comply; provided, such Additional
Services shall be at no greater cost
than Tenant is able to obtain in
arm's-length negotiations with
reputable service providers.
OPERATING 5. (a) The Tenant covenants to pay to the
CHARGES PAYABLE Landlord the Tenant's Proportionate
Share of the excess of the amount of
the Operating Costs in each Fiscal
Period over the Operating Costs in the
Base Year.
(b) In this Lease, "Operating Costs" shall
mean all costs incurred or which will
be incurred by the Landlord in the
maintenance, operation, administration
and management of the Property,
including, without limitation:
(i) cost of heating, ventilating and
air-conditioning (HVAC);
(ii) cost of water and sewer charges;
(iii) cost of insurance carried by the
Landlord pursuant to Paragraph
9(a) of this Lease and cost of
any deductible amount paid by
the Landlord in connection with
each claim made by the Landlord
under such insurance;
(iv) costs of building office
expenses, including telephone,
rent, stationery and supplies;
(v) cost of fuel and electricity;
(vi) costs of all elevator and
escalator (if installed in the
Building) maintenance and
operation;
(vii) costs of operating staff,
management staff and other
administrative personnel,
including salaries and wages,
along with a management fee
directly related to the Property
(which management fee shall be
commensurate with the management
fees charged at similar
buildings located in the major
business district of the City of
Irvine, State of California);
(viii)cost of providing security, if
any;
(ix) cost of providing janitorial
services, window cleaning,
garbage and snow removal and
pest control;
(x) cost of supplies and materials;
(xi) cost of decoration of common
areas;
(xii) cost of landscaping;
(xiii)cost of maintenance and
operation of the parking area;
(xiv) cost of consulting, and
professional fees including
expenses;
(xv) cost of replacements, additions
and modifications, and cost of
repair; and
(xvi) the Tenant covenants to pay to
the Landlord the Tenant's
Proportionate Share of the costs
in respect of each "Major
Expenditure" (as hereinafter
defined) as amortized over the
period of the Landlord's
reasonable estimate of the
economic life of the Major
Expenditure, but not to exceed
fifteen (15) years, using equal
monthly installments of
principal and interest at ten
percent (10%) per annum
compounded semi-annually. For
the purposes hereof, "Major
Expenditure" shall mean any
expenditure incurred after the
Commencement Date for
replacement of machinery,
equipment, systems or facilities
forming a part of or used in
connection with the Property or
for modifications, upgrades or
additions to the Property or
facilities used in connection
therewith; provided, that in
each case, such expenditure is
more than ten percent (10%) of
the total Operating Costs of the
immediately preceding Fiscal
Period.
(c) In this Lease there shall be excluded
from Operating Costs the following:
(i) interest on debt and capital
retirement of debt, and
refinancing costs;
(ii) such of the Operating Costs as
are recovered from insurance
proceeds;
(iii) costs as determined by the
Landlord of acquiring tenants
for the Property;
(iv) commissions, attorneys' fees,
costs and disbursements and
other expenses, all of which are
incurred in connection with
solicitations, negotiations or
disputes of any kind with other
tenants, occupants, including
subtenants and assignees,
purchasers, lenders or otherwise
on the Property;
(v) renovating or otherwise
improving or decorating,
painting or redecorating
(including architectural,
engineering, permitting and
other related costs) leased
space for tenants or other
occupants or vacant tenant
space), other than ordinary
maintenance provided to all
tenants, including the Tenant,
except for any common areas;
(vi) Landlord's costs of utilities
and other services or items sold
separately to other tenants for
which Landlord is entitled to be
reimbursed by such tenant as an
additional charge over and above
the rent and operating expense
or other rental adjustments
payable with
D-2
respect to such
tenant;
(vii) any charge for depreciation of
the Building for equipment and
expenses relating to financing,
including interest on debt or
amortization payments on any
mortgage or mortgages, including
rental, created under any ground
or underlying leases;
(viii)any particular items and
services for which another
tenant or occupant otherwise
reimburses Landlord by direct
payment over and above rent and
operating expense adjustments;
(ix) charitable or political
contributions, advertising and
promotional expenditures,
including cost of staging
special events;
(x) expenses for period not covered
under this Lease (except as a
result of Tenant's negligence
and/or willful misconduct or
caused by any act or omission of
Tenant or Tenant's agents,
contractors and/or
representatives); and
(xi) expenses (such as real estate
taxes, insurance, cleaning,
salary and the like) incurred as
a result of special improvements
or special uses (such as a
newsstand, daycare, building
rental office, garage and other
areas) which do not relate
directly to the Landlord's
services under this Lease and
are designed to specifically
benefit another tenant or
occupant on the Property.
6. In calculating Operating Costs for any Fiscal
Period, including the Base Year, if less than one
hundred percent (100%) of Building is occupied by
tenants, then the amount of such Operating Costs
shall be deemed for the purposes of this Schedule
--------
"D" to be increased to an amount equal to the like
---
Operating Costs which normally would be expected by
the Landlord to have been incurred had such
occupancy been one hundred percent (100%) during
such entire period.
7. In this Lease:
(i) "Tenant's Proportionate Share"
shall mean fifty-one percent
(51%), subject to adjustment as
determined solely by the
Landlord and notified to the
Tenant in writing for physical
increases or decreases in the
total rentable area of the
Property; provided, the total
rentable area of the Property
and the rentable area of the
Leased Premises shall exclude
areas designated (whether or not
rented ) for parking and for
storage.
(ii) "Base Year" shall mean calendar
year 1998.
8. Notwithstanding anything to the contrary set
forth in this Schedule "D" or elsewhere in this
------------
Lease, and including as may already be charged
by Landlord to Tenant as Additional Rent and/or
Additional Services under this Lease, the
Tenant shall be responsible to obtain and pay
for all HVAC, telephone, and janitorial and
cleaning services supplied to the Leased
Premises, together with any of Tenant's Taxes
thereon (pursuant to Paragraph 2 of Schedule
--------
"C" attached hereto).
---
D-3
SCHEDULE "E"
RULES AND REGULATIONS
1. The sidewalks, entry passages, elevators (if installed in the Building) and
common stairways shall not be obstructed by the Tenant or used for any other
purpose than for ingress and egress to and form the Leased Premises. The Tenant
will not place or allow to be placed in the Building corridors or public
stairways any waste paper, dust, garbage, refuse or anything whatever.
2. The washroom plumbing fixtures and other water apparatus shall not be used
for any purposed other than those for which they were constructed, and no
sweepings, rubbish, rags, ashes or other substances shall be thrown therein.
The expense of any damage resulting from misuse by the Tenant shall be borne by
the Tenant.
3. The Tenant shall permit window cleaners to clean the windows of the Leased
Premises, upon at least twenty-four (24) hours prior written notice to Tenant,
including during normal business hours.
4. No birds or animals shall be kept in or about the Property nor shall the
Tenant operate or permit to be operated any musical or sound-producing
instruments or device or make or permit any improper noise inside or outside the
Leased Premises which may be heard outside such Leased Premises.
5. No one shall use the Leased Premises for residential purposes, or for the
storage of personal effects or articles other than those required for business
purposes.
6. [Intentionally Deleted].
7. No dangerous or explosive materials shall be kept or permitted to be kept in
the Leased Premises.
8. The Tenant shall not permit any cooking in the Leased Premises. The Tenant
shall not install or permit the installation or use of any machine dispensing
goods for sale in the Leased Premises without the prior written approval of the
Landlord. Only persons authorized by the Landlord shall be permitted to deliver
or to use the elevators (if installed in the Building) for the purpose of
delivering food or beverages to the Leased Premises.
9. The Tenant shall not bring in or take out, position, construct, install or
move any safe, business machine or other heavy office equipment without first
obtaining the prior written consent of the Landlord. In giving such consent,
the Landlord shall have the right in its sole discretion, to prescribe the
weight permitted and the position thereof, and the use and design of planks,
skids or platform to distribute the weight thereof. All damage done to the
Building by moving or using any such heavy equipment or other office equipment
or furniture shall be repaired at the expense of the Tenant. The moving of all
heavy equipment or other office equipment or furniture shall occur only at times
consented to by the Landlord and the persons employed to move the same in and
out of the Building must be acceptable to the Landlord. Safes and other heavy
office equipment will be moved through the halls and corridors only upon steel
bearing plates. No freight or bulky matter of any description will be received
into the Building or carried in the elevators ( if installed in the Building)
except during hours approved by the Landlord.
10. The Tenant shall give the Landlord prompt notice of any accident to, or any
defect in the plumbing, HVAC, mechanical or electrical apparatus or any other
part of, the Building and/or the Property.
11. Pursuant to the Parking Agreement between Landlord and Tenant attached
hereto, the parking of automobiles shall be subject to the reasonable
regulations of the Landlord and any future reasonable parking charges imposed by
any governmental or quasi-governmental authority during the Term. The Landlord
shall not be responsible for damage to or theft of any car, its accessories or
contents whether the same be the result of negligence, willful misconduct or
otherwise.
12. The Tenant shall not xxxx, drill into or in any way deface the walls,
ceilings, partitions, floors or other parts of the Leased Premises and the
Building.
13. Except with the prior written consent of the Landlord, Tenant shall not use
or engage any person or persons, other than the janitor or janitorial contractor
reasonably approved by the Landlord, for the purpose of any cleaning of the
Leased Premises; provided, such cleaning services shall be at no greater cost
than Tenant is able to obtain in arm's length negotiations with reputable
service providers.
14. If the Tenant desires any electrical or communications wiring, the Landlord
reserves the right to direct qualified person as to where and how the wires are
to be introduced, and without such directions no borings or cutting for wires
shall take place. No other wires or pipes of any kind shall be introduced
without the prior written consent of the Landlord pursuant to Schedule "F"
------------
attached hereto.
15. The Tenant shall not place or cause to be place any additional locks upon
any doors of the Leased Premises without the approval of the Landlord and
subject to any conditions imposed by the Landlord. Additional keys may be
obtained form the Landlord at the cost of the Tenant.
16. The Tenant shall be entitled to have its name shown upon the directory
board of the Building, if applicable, and the exterior main entrance doors to
the Leased Premises, all at the Tenant's expense, but the Landlord shall in its
sole discretion design the style
E-1
of such identification and allocate the space on the directory board for the
Tenant, if applicable, pursuant to Schedule "N" attached hereto.
------------
17. The Tenant shall not interfere with or obstruct any perimeter HVAC units.
18. The Tenant shall not conduct, and shall not permit any, canvassing in the
Building.
19. The Tenant shall take care of the rugs and drapes (if any) in the Leased
Premises and shall arrange for the carrying-out of regular janitorial cleaning
of the Leased Premises, and spot cleaning and shampooing of carpet and dry
cleaning of drapes in a manner reasonably acceptable to the Landlord.
20. The Tenant shall permit the periodic closing of lanes, driveways and
passages for the purpose of preserving the Landlord's rights over such lanes,
driveways and passages.
21. Subject to the Tenant's signage rights set forth in Schedule "N" attached
------------
hereto, the Tenant shall not place or permit to be placed any sign,
advertisement, notice or other display on any part of the exterior of the Leased
Premises or elsewhere if such sign, advertisement, notice or other display is
visible from outside the Leased Premises without the prior written consent of
the Landlord which may be arbitrarily withheld. The Tenant, upon request of the
Landlord, shall immediately remove any sign, advertisement, notice or other
display which the Tenant has placed or permitted to be place which, in the
opinion of the Landlord, is objectionable, and if the Tenant shall fail to do
so, the Landlord may remove the same at the expense of the Tenant.
22. The Landlord shall have the right to make such other and further reasonable
rules and regulations and to alter the same, as in its judgment may from time to
time be needful, for the safety, care, cleanliness and appearance of the Leased
Premises and the Building and for the preservation of good order therein, and
the same shall be kept and observed by Tenant and tenant's employees and
servants. The Landlord also has the right to suspend or cancel any or all of
these rules and regulations herein set out.
E-2
SCHEDULE "F"
LEASEHOLD IMPROVEMENTS
DEFINITION OF 1. For purposes of this Lease, the term "Leasehold
LEASEHOLD Improvements" includes, without limitation, all fixtures,
IMPROVEMENTS improvements, installations, alterations and additions
from time to time made, erected or installed by or on
behalf of other tenants in other premises in the Building
(including the Landlord if an occupant of the Building),
including all partitions, doors and hardware however
affixed, and whether or not movable, all mechanical,
electrical and utility installations and all carpeting and
drapes, with the exception only of the Landlord's Work and
Tenant's trade fixtures, furniture and equipment not of
the nature of fixtures.
INSTALLATION OF 2. The Landlord shall include in the Leased Premises the
IMPROVEMENTS Landlord's Work. The Tenant shall not make, erect, install
AND FIXTURES or alter any Leasehold Improvements in the Leased Premises
without having requested and obtained the Landlord's prior
written approval. The Landlord's approval shall not, if
given, under any circumstances be construed as a consent
to the Landlord having its estate charged with the cost of
work. The Landlord shall not unreasonably withhold its
approval to any such request, but failure to comply with
the Landlord's reasonable requirements from time to time
for the Building shall be considered sufficient reason for
refusal. In making, erecting, installing or altering any
Leasehold Improvements the Tenant shall not, without the
prior written approval of the Landlord, alter or interfere
with any installations which have been made by the
Landlord or others and in no event shall alter or
interfere with window coverings (if any) or other light
control devices (if any) installed in the Building. The
Tenant's request for any approval hereunder shall be in
writing and accompanied by an adequate description of the
contemplated work and, where appropriate, working drawings
and specifications thereof. If the Tenant requires from
the Landlord drawings or specifications of the Building in
connection with any Leasehold Improvements, the Tenant
shall pay the cost thereof to the Landlord on demand. Any
reasonable costs and expenses incurred by the Landlord in
connection with the Tenant's Leasehold Improvements shall
be paid by the Tenant to the Landlord on demand. All work
to be performed in the Leased Premises shall be performed
by competent contractors and sub-contractors of whom the
Landlord shall have approved in writing prior to
commencement of any work, such approval not to be
unreasonably withheld. All such work, including the
deliver, storage and removal of materials, shall be
subject to the reasonable supervision of the Landlord,
shall be performed in accordance with any reasonable
conditions or regulations imposed by the Landlord
including, without limitation, payment of Landlord's
reasonable out-of-pocket construction supervision fee, and
shall be completed in good and workmanlike manner in
accordance with the description of the work approved by
the Landlord and in accordance with all laws, regulations
and by-laws of all regulatory authorities. Copies of
required building permits or authorizations shall be
obtained by the Tenant at its expense and copies thereof
shall be provided to the Landlord. No locks shall be
installed on the entrance doors or in any doors in the
Leased Premises that are not keyed to the Building's
master key system with copies of any keys delivered to
Landlord.
LIENS AND 3. In connection with the making, erection, installation
ENCUMBRANCES ON or alteration of Leasehold Improvements and all other work
IMPROVEMENTS or installations made by or for the Tenant in the Leased
AND FIXTURES Premises the Tenant shall comply with all the provisions
of the mechanics' lien and other similar statutes form
time to time applicable thereto (including any proviso
requiring or enabling the retention by way of holdback of
portions of any sums payable) and, except as to any such
holdback, shall promptly pay all accounts relating
thereto. Except in the ordinary course of Tenant's
business, the Tenant will not create any mortgage, deed of
trust or conditional sale agreement in respect of its
Leasehold Improvements or, without the written consent of
the Landlord, with respect to its trade fixtures nor shall
the Tenant take any action as a consequence of which any
such mortgage, deed of trust or conditional sale agreement
would attach to the Property or any part thereof. If and
whenever any mechanics' or other lien for work, labor,
services or materials supplied to or for the Tenant or for
the cost of which the Tenant may be in any way liable or
claims therefor shall arise or be filed or any such
mortgage, conditional sale agreement or other encumbrance
shall attach, the Tenant shall within twenty (20) days
after submission by the Landlord of notice thereof procure
the discharge thereof, including any certificate of action
registered in respect of any lien, by payment or giving
security or in such other manner as may be required or
permitted by law, and failing which the Landlord may avail
itself of any of its remedies hereunder for default of the
Tenant and may make any payments or take any steps or
proceedings required to procure the discharge of any such
liens or encumbrances, and shall be entitled to be repaid
by the Tenant on demand for any such payments and to be
paid on demand by the Tenant for all costs and expenses
(including attorneys' fees and costs, and court costs) in
connection with steps or proceedings taken by the Landlord
and the Landlord's right to reimbursement and to payment
shall not be affected or impaired if the Tenant shall then
or subsequently establish or claim that any lien or
encumbrances so discharged was without merit or excessive
or subject to any abatement, set-off or defense. The
Tenant agrees to indemnify, defend (with counsel
reasonably acceptable to Landlord) and hold harmless
Landlord and the Property form all claims, costs and
expenses (including attorneys' fees and costs, and court
costs) which may be incurred by the Landlord in any
proceedings brought by any person against the Landlord
alone or with another of others for or in respect of work,
labor, services or materials supplied to or at the request
of Tenant.
F-1
REMOVAL OF 4. All Leasehold Improvements in or upon the Leased
IMPROVEMENTS Premises shall immediately upon their placement be and
AND FIXTURES become the Landlord's property without compensation
therefor to the Tenant; however; and to the extent
otherwise expressly agreed to by the Landlord in writing,
no Leasehold Improvements, furniture or equipment shall be
removed by the Tenant from the Leased Premises either
during or at the expiration or sooner termination of the
Term, except that:
(a) the Tenant shall, prior to the end of the
Term, (i) remove such of the Leasehold
Improvements and trade fixtures in the
Leased Premises as the Landlord shall
require to be removed (as reasonably
determined by Landlord, in writing delivered
to Tenant, prior to installation), and (ii)
Tenant shall be entitled to remove the
following items from the Leased Premises
(subject to the terms of this Lease):
parabolic light fixtures (so long as Tenant
has replaced any such removed light fixtures
with operational Building standard light
fixtures in good condition); the raised
floor in the Leased Premises only; the UPS
Generator and any other generators installed
by Tenant, and any above-ground storage tank
for diesel fuel servicing the UPS Generator
and/or the other generators, if at all; the
Liebert-brand or similar brand of HVAC unit;
the "FM200 System" (as hereinafter defined)
(so long as the original water fire
suppression (sprinkler) system is
operational and in good condition); the
security/surveillance system (pursuant to
Paragraph 5(a)(vi) blow); furniture and
systems furniture; cabinets, cages and
racks; computer equipment; the Telco-brand
system; consoles; full-height glass walls;
specific power system upgrades installed by
Tenant in the Leased Premises only;
communications equipment; and condensers.
(b) [Intentionally Deleted].
The Tenant shall, in the case of every removal, make good
at the expense of the Tenant any damage caused to the
Property by the installation and removal. In the event of
the non-removal by the end of the Term or sooner
termination of this Lease of such trade fixtures or
Leasehold Improvements required by the Landlord of the
Tenant to be removed, the Landlord shall have the option,
in addition to its other remedies under this Lease, to
declare to the Tenant that such trade fixtures are the
property of the Landlord and the Landlord upon such a
declaration may dispose of such trade fixtures and retain
any proceeds of disposition as security for the Debts,
Liabilities and Obligations, and the Tenant shall be
liable to the Landlord for any expenses incurred by the
Landlord in connection therewith.
5. For the purpose of this Lease,
(a) the term "Tenant's Work" shall mean the
initial Leasehold Improvements and all work
required to be done to complete the Leased
Premises for occupancy by the Tenant,
excluding the Landlord's Work, which may
include the following:
(i) Landlord will provide to Tenant,
during the Term (including any
"Renewal Term" (as hereinafter
defined)), at no additional cost to
Tenant, a space measuring 12' x 20'
and located in the exterior parking
area of the Property along the
southern boundary of the Building
(adjacent to the Building's roll-up
door/doors) for Tenant's design,
construction and operation of a UPS
Generator capable of providing 500-
1,000 KVA for Tenant's exclusive use,
including an enclosure around the UPS
Generator, an umbilical line from the
Leased Premises to the UPS Generator,
and the installation and maintenance
of a temporary generator and all
wiring in connection therewith
(collectively, the "UPS Generator");
(ii) Tenant shall be entitled to bring into
the Building a minimum of five (5)
fiber optic cable services form the
street outside of the Property to the
Leased Premises, for services to same;
(iii) tenant shall be entitled to design,
construct and install the "Antennas"
(as hereinafter defined) on the roof
of the Building (including Landlord-
approved roof penetrations thereon),
all in accordance herewith and with
Schedule "N" attached hereto;
-----------
(iv) Tenant shall be entitled to design and
construct the relocation of the
existing restrooms located on the
first (1st) floor of the Building to
area located adjacent to the main
lobby of the Building, and also to
remove the existing stairwell located
adjacent to the existing restrooms on
the first (1st) floor of the Building;
(v) Tenant will install a FM200 and
preactivated dry water fire
suppression system (the "FM200
System") in the Leased Premises and
elsewhere on the first (1st) floor of
the Building; and
F-2
(vi) Tenant shall be entitled to construct
and install video surveillance cameras
in the Leased Premises and no more
than two (2) such video surveillance
cameras outside of the Leased
Premises, along with a card-key or
other security system linking the
points of entry to the Leased
Premises.
(b) Notwithstanding anything to the contrary set
forth in this Lease, Tenant's design,
location, construction, maintenance and
removal of the Tenant's Work, including the
UPS Generator, any fiber optic cable
services installed by or on behalf of
Tenant, the Antennas, Tenant's relocation of
the existing restrooms, removal of the
existing stairwell located adjacent to the
existing restrooms, and installation of the
FM200 System, and all of Tenant's security
cameras and systems (all as set forth in
Paragraphs 5(a)(i)-(vi) above), shall be
consistent with the first-class quality and
character of the Building and the Property,
shall remain subject to the prior approval
of Landlord (including the location of and
wiring for all of Tenant's Work), and shall
comply with all applicable federal, state
and local rules, regulation, laws, permits
and approvals. During the Term, including
any Renewal Term, all of Tenant's work,
shall be maintained at Tenant's sole cost
and expense, pursuant to a repair and
maintenance program reasonably approved by
Landlord and otherwise in accordance with
this Lease. At the expiration or earlier
termination of this Lease, the Tenant's
work, as applicable, shall be subject to
Paragraph 4 of this Schedule "F", all at
-----------
Tenant's sole cost and expense (including
the removal of any lingering identification
on the Leased Premises, the Building and/or
the Property, where such Tenant's Work was
located).
(c) Within fifteen (15) days after the delivery
of a fully-executed original of this Lease
by Landlord to Tenant, Tenant shall cause
Tenant's architect to prepare a space plan,
which shall show the basic configuration of
all of Tenant's Work (the "Space Plan").
Within five (5) business days after Landlord
and Landlord's architect receive the Space
Plan from Tenant, Landlord and/or Landlord's
architect shall either approve or disapprove
such Space Plan in writing delivered to
Tenant, noting with reasonable particularity
any changes or corrections therein. Within
five (5) business days after Landlord's
written approval of the Space Plan, Tenant
shall cause Tenant's architect to prepare
and deliver to Landlord the final working
drawings and specifications for the Tenant's
Work, which shall be based substantially
upon the Space Plan (the "Final Plans").
Within five (5) business days after Landlord
and Landlord's architect receive the Final
Plans from Tenant, Landlord and/or
Landlord's architect shall either approve or
disapprove the Final Plans in writing
delivered to Tenant, noting with reasonable
particularity any changes or corrections
therein. If Landlord makes any changes or
corrections to the Final Plans, Tenant's
architect shall resubmit the revised Final
Plans to Landlord and Landlord's architect
within three (3) business days after receipt
by Tenant of Landlord's changes or
corrections, and thereafter, Landlord and/or
Landlord's architect shall either approve or
disapprove the revised Final Plans within
three (3) business days after Landlord and
Landlord's architect receive same, in
writing delivered to Tenant, noting with
reasonable particularity any further changes
or corrections therein. All costs to
Landlord, including Landlord's architect and
engineers, if any, in reviewing the Space
Plan and any Final Plans shall be deducted
form the "Tenant Improvement Allowance" (as
hereinafter defined), along with the costs
of Tenant, and Tenant's architects,
engineers and/or consultants, in preparing,
reviewing and revising the Space Plan and
the Final Plans.
(d) Tenant shall diligently and in good-faith
commence and complete the construction of
the Tenant's Work by selecting a general
contractor, construction manager,
subcontractors and/or engineers of Tenant's
choice, subject to Landlord's reasonable
approval (which approval shall not be
unreasonably withheld or delayed) and
provided that each of the foregoing must be
licensed and insured in the State of
California. Landlord shall not charge any
provisory or other fee in connection with
the Tenant's work, except for Landlord's
reasonable out-of-pocket construction
supervision fee and other actual out-of-
pocket expenses incurred in connection
therewith. Tenant's contractors, employees,
and all other designated personnel shall
have the unimpeded access to the Leased
Premises and certain other parts of the
Building (upon prior written notice to, and
the reasonable approval of, Landlord, which
approval shall not be unreasonably withheld
or delayed, and provided that Landlord
and/or Landlord's designated representative
may accompany Tenant to certain other parts
of the Building), for the construction of
the Tenant's Work, all in accordance wit the
terms of this Lease, including, but not
limited to, the Rules and Regulations for
the Building attached as Schedule "E"
-----------
hereto. Tenant shall cause Tenant's
architect or such general contractor, or
both, to apply for the required permits and
approvals to construct the Tenant's Work,
which permits and approvals shall be charged
against the Tenant Improvement Allowance;
provided, however, Landlord makes no
representation nor warranty, either express
or implied, with respect to whatever
permits, certificates or approvals will be
required for the Tenant's Work, if any, or
if required, at what costs and how quickly
they can be obtained.
(e) Following Tenant's receipt of all required
permits and approvals (which shall be
available for
F-3
Landlord's review concurrent with Tenant's
review), Tenant's general contractor shall
diligently pursue the construction and
completion of the Tenant's Work, subject
only to delays set forth in Paragraph 15 of
this Lease. Notwithstanding anything to the
contrary set forth herein or elsewhere in
this Lease, however, and regardless of the
then-current status of Tenant's design
permitting, construction and completion of
the Tenant's Work, the actual Commencement
Date of the Term shall be defined as, and
will be deemed to occur on September 1, 1997
(as set forth in Paragraph 2(a) of this
Lease).
(f) Landlord shall contribute an amount up to,
but in no event to exceed, the Tenant
Improvement Allowance, which amount shall be
applied by Landlord's review and approval of
the Space Plan and the Final Plans, all
permits and approvals, construction and
completion of the Tenant's Work in the
Leased Premises, but shall not be applied
against the Landlord's Work. Tenant shall,
within twenty (20) days after written demand
by Landlord to Tenant, be obligated to pay
for all costs related to or in connection
with Tenant's Work which are in excess of
the Tenant Improvement Allowance. Tenant
shall not be entitled to receive any payment
or credit, or nay off-set or deduction
against any monetary obligation of Tenant
under this Lease, for any portion of the
Tenant Improvement Allowance which is not
expended hereunder or in accordance with
Schedule "G" attached hereto.
-----------
6. For the purposes of this Lease, the term "Landlord's
Work" shall mean only the following (which shall not be a
part of the Leasehold Improvements, and shall immediately
upon their placement be and become the Landlord's
property):
(a) Landlord will relocate the existing
telephone equipment and telephone room from
the first (1st) floor of the Building to the
second (2nd) floor of the Building;
(b) Landlord will provide Tenant with a separate
meter or meters, and related metering
equipment, for the utilities and services to
be used by Tenant in the Leased Premises, as
set forth in Schedule "D" attached hereto;
-----------
and
(c) Landlord will design and construct an
upgrade of the base system for the Building
to provide a new 1,600 amp, 480/277 volt
three (3) phase electrical service delivered
to the electrical room of the Building (the
"Electrical Service Upgrade"), for Tenant's
exclusive use in the Leased Premises.
(d) All of the Landlord's Work shall be
designed, constructed and completed by
Landlord (including the location of and any
wiring related to the Landlord's Work), at
Landlord's sole discretion, and will be
completed by Landlord on or before the
Commencement Date. The Landlord's Work shall
be at Landlord's sole cost and expense
(except as otherwise provided herein), and
shall not be a part of the Tenant
Improvement Allowance. Notwithstanding
anything to the contrary set forth herein,
as additional consideration for the
performance of Landlord's obligations under
this Lease, Tenant hereby agrees to
reimburse Landlord for a portion of the
total cost of the Electrical Service Upgrade
as follows: after Landlord's completion of
the Electrical Service Upgrade and the
calculation by Landlord of the total cost of
same (the "Electrical Service Upgrade
Cost"), Landlord hereby agrees to pay the
first Twenty Thousand Dollars (US$20,000.00)
of the Electrical Service Upgrade Cost, and
thereafter, Landlord hereby further agrees
to pay one-half ( 1/2) of the remaining
balance of the Electrical Service Upgrade
Cost. Thereafter, the remaining balance of
the Electrical Service Upgrade Cost will be
payable by Tenant to Landlord, as part of
the Rent due under this Lease commencing on
the Commencement Date and continuing on the
first (1st) day of each month thereafter,
amortized over the initial one hundred
twenty (120) month Term at an interest rate
of ten percent (10%) per annum. If, for
example and as a means of illustration only,
the actual amount of the Electrical Service
Upgrade Cost is Fifty-Nine Thousand Nine
Hundred Thirty-One Dollars (US$59,931.00),
then after Landlord's contribution to the
Electrical Service Upgrade Cost of Thirty-
Nine Thousand Nine Hundred Sixty-Five and
50/100 Dollars (US$39,965.50) (the first
US$20,000.00 plus one-half ( 1/2) of the
----
remaining balance of the Electrical Service
Upgrade Cost [US$19,965.50, in this case]),
Tenant will be obligated to reimburse
Landlord for the remaining US$19,965.50 (the
remaining balance of the Electrical Service
Upgrade Cost), in a monthly amount amortized
and at the interest rate set forth herein.
F-4
SCHEDULE "G"
TENANT IMPROVEMENT ALLOWANCE
The Landlord hereby agrees to contribute to Tenant for the Tenant's Work, but
not as part of the Landlord's Work, a "Tenant Improvement Allowance" in an
amount up to, but in no event to exceed, Ten Dollars (US$10.00) per square foot
multiplied by the total rentable square feet of the Leased Premises, as
calculated by Landlord pursuant to Paragraph 1 of this Lease (approximately One
Hundred Sixty-Seven Thousand Five Hundred Dollars (US$167,500.00) [16,750
rentable square feet multiplied by US$10.00 per square foot]), which Tenant
Improvement Allowance shall be contributed by Landlord following Landlord's
receipt of evidence reasonably satisfactory to Landlord that all contractors,
workmen, material and service suppliers and all the persons having claims
against the Tenant for payment of work done or materials or services supplied in
connection with the Tenant's Work have been paid in full. Landlord's
contribution of the Tenant Improvement Allowance is for the purpose set forth in
Paragraph 5(f) of Schedule "F" attached hereto. It is a condition precedent to
------------
Landlord's obligation to contribute the Tenant Improvement Allowance hereunder
that a claim for said contribution of the Tenant Improvement Allowance be made
by Tenant, along with the delivery by Tenant of reasonably satisfactory evidence
of all of the foregoing, to Landlord. Landlord may, but shall not be obligated
to, pay any contractor, workmen, material and/or service suppliers and all the
persons who performed work or supplied materials or services in connection with
the Tenant's Work, if the Tenant has failed to do so, and the Tenant shall pay
the Landlord on demand the amount the Landlord has so paid, unless such payment
is made by Landlord prior to the Landlord's contribution to the Tenant of any of
the Tenant Improvement Allowance, in which case the amount of such payment by
Landlord shall be deducted from all or any remaining portion of the Tenant
Improvement Allowance.
G-1
SCHEDULE "H"
OPTION TO RENEW
(a) The Landlord covenants with the Tenant that if the Tenant duly and
regularly pay s the Rent and any and all other amounts required to be paid
pursuant to this Lease and performs each and every covenant, proviso and
agreement on the part of the Tenant to be paid, rendered, observed and
performed herein, the Landlord hereby, upon written notice by the Tenant
and received by the Landlord not more than nine (9) months nor less than
six (6) months prior to the expiration of the ten-expiring Term of the
first Renewal Term, as applicable, grants to the Tenant two (2) consecutive
options to renew (an "Option" or, collectively, the "Options") this Lease
for an additional five (5) year period each (a "Renewal Term" or,
collectively, the "Renewal Terms"), on the same terms and conditions as in
this Lease at the commencement of the applicable Renewal Term, save and
except for Tenant's right to any further renewal (except for the Renewal
Terms), Landlord's Work, Basic Rent, and any Tenant Improvement Allowance.
(b) The Basic Rent for each applicable Renewal Term shall be determined by
negotiations between the parties hereto, and it is agreed that during such
negotiations in respect of Basic Rent, they will be guided by the "Fair
Market Rental Rate" (as hereinafter defined) for the Leased Premises and by
the provisions of Paragraphs (c) and (d) below; provided, however, in no
event shall the Basic Rent per annum applicable to the Renewal Terms be
lower that the Basic Rent per annum for the last year of the Term just
ending.
(c) For the purposes of this Schedule "H" and Schedule "L" attached hereto
------------ ------------
only, the term "Fair Market Rental Rate" shall mean the annual amount per
rentable square foot that a willing, comparable non-renewal, non-equity,
non-expansion tenant would pay for unencumbered space, and Landlord would
accept, at arm's length, giving appropriate consideration to annual rental
rates per rentable square foot, escalations (including type, gross or net,
and if gross, whether base year or expense stop), abatement provisions
reflecting free rent, if any, brokerage commissions, if any, length of the
lease term, and size and location of the premises being leased. To allow
for a decision as to the Fair Market Rental Rate, the parties hereto may
consider, for comparison purposes, transactions in comparable,
unencumbered, non-renewal space in "Comparable Buildings," which shall mean
Comparable Buildings to the Building in use, quality and size, and located
in the major business district of the City of Irvine, State of California.
Landlord shall give written notice of Landlord's determination of the Fair
Market Rental Rate to Tenant promptly after Landlord's receipt of Tenant's
written notice to exercise an Option hereunder, and the parties hereto will
then proceed to determine the Basic Rent for the applicable Renewal Term in
accordance with this Schedule "H".
------------
(d) In the event Tenant rejects the determination of the Fair Market
Rental Rate submitted by Landlord, then Landlord and Tenant shall attempt
in good-faith to agree upon such Fair Market Rental Rate. If Landlord and
Tenant fail to reach agreement within fifteen (15) days following Tenant's
receipt of Landlord's determination of the Fair Market Rental Rate (the
"Outside Agreement Date"), then each party's determination of the Fair
Market Rental Rate shall be submitted to appraisal in accordance with the
following:
(i) Landlord and Tenant shall each appoint one independent appraiser
who shall by profession be a real estate broker active over the previous
five (5) year period ending on the date of such appointment in the leasing
of commercial properties in the City of Irvine, California. Each such
appraiser shall be appointed within fifteen (15) days after the Outside
Agreement Date If either Landlord or Tenant fails to timely appoint an
appraiser, as the other party's request, JAMS/Endispute or an "Arbitrator"
(as defined in clause (d)(v) below) shall appoint their or its appraiser.
(ii) The two (2) appraisers so appointed shall, within fifteen (15)
days after the appointment of the last appraiser, agree upon and appoint a
third appraiser who shall be qualified under the same criteria.
(iii) The three (3) appraisers shall, within thirty (30) days after the
appointment of the third appraiser, decide whether the parties shall use
Landlord's or Tenant's submitted Fair-Market Rental Rate, and shall notify
Landlord and Tenant in writing thereof. The appraisers' determination shall
be limited solely to the issue of whether Landlord's or Tenant's submitted
Fair Market Rental Rate for the applicable Renewal Term is closest to the
then-prevailing Fair Market Rental Rate, as determined by the appraisers
taking into account the requirements set forth in this Schedule "H". Such
------------
decision shall be based upon the projected, then-prevailing Fair Market
Rental Rate as of the proposed commencement date of the applicable Renewal
Term.
(iv) The three (3) appraisers' majority decision shall be binding
upon Landlord and Tenant, without any right of appeal or objection,
judicial or otherwise.
(v) If the appraisers fail to agree upon and appoint a third
appraiser, both appraisers shall be dismissed and the matter shall be
submitted to arbitration under the provisions of JAMS/Endispute in Orange
County, California, with a determination within thirty (30) days thereafter
based upon the same procedures set forth above (i.e., by selecting either
----
Landlord's or Tenant's submitted Fair Market Rental Rate only, as closest
----
to the then-prevailing Fair Market Rental Rate). If JAMS/Endispute no
longer exists, then the matter shall be settled by binding arbitration
before a single arbitrator appointed pursuant to the Rules of the American
Arbitration Association in effect at the time of the arbitration (the
"Rules") and shall otherwise be conducted pursuant to such Rules. The
"Arbitrator"
H-1
shall be a lawyer or judge having at least twenty (20) years professional
experience, and the arbitration shall be held in Orange County, California,
and be conducted in confident and without public disclosure by the
Arbitrator or any party or their representatives of any matters relevant to
the arbitration. Judgment may be entered on any arbitration award in any
court having competent jurisdiction thereof.
(vi) All costs of appraisal hereunder, and arbitration if necessary,
shall be shared equally by the parties hereto.
(e) The Tenant agrees to execute the Landlord's commercially reasonable
lease amendment agreement then, at the commencement of each applicable
Renewal Term, being used by the Landlord for the Building to give effect to
an Option, if exercised by the Tenant. The Tenant shall execute such
commercially reasonable agreement prior to the commencement date of the
applicable Renewal Term.
(f) Notwithstanding the above, if the Tenant does not exercise Tenant's
first Option in accordance with this Schedule "H," then the Options are
-----------
hereby automatically terminated and of not further force and effect.
NOTICE: BY INITIALING THIS SCHEDULE "H" YOU ARE AGREEING TO HAVE ANY
-----------
DISPUTE ARISING OUT OF THE DETERMINATION OF FAIR MARKET RENTAL RATE FOR ANY
OPTION DECIDED BY NEUTRAL ARBITRATION AS PROVIDED BY CALIFORNIA LAW, AND
YOU ARE GIVING UP ANY RIGHTS YOU MIGHT POSSESS TO HAVE SUCH DISPUTE
LITIGATED IN A COURT OR JURY TRIAL. BY INITIALING THIS SCHEDULE "H" YOU ARE
GIVING UP YOUR JUDICIAL RIGHTS TO DISCOVERY AND APPEAL, UNLESS SUCH RIGHTS
ARE SPECIFICALLY INCLUDED IN THIS SCHEDULE "H". IF YOU REFUSE TO SUBMIT TO
-----------
ARBITRATION AFTER AGREEING TO THIS SCHEDULE "H", YOU MAY BE COMPELLED TO
-----------
ARBITRATE UNDER THE AUTHORITY OF THE CALIFORNIA CODE OF CIVIL PROCEDURE.
YOUR AGREEMENT TO THIS ARBITRATION IS VOLUNTARY. THE PARTIES HERETO HAVE
READ AND UNDERSTAND THE FOREGOING AND AGREE TO SUBMIT ANY DISPUTE ARISING
OUT OF THE DETERMINATION OF THE FAIR MARKET RENTAL RATE FOR ANY OPTION TO
NEUTRAL ARBITRATION.
/s/ Illegible /s/ Illegible
------------------------------------------- ---------------------------------------------
LANDLORD'S INITIALS TENANT'S INITIALS
H-2
SCHEDULE "I"
OCCUPANCY PRIOR TO COMMENCEMENT DATE
The Tenant may enter the Property, including the Leased Premises, upon full
execution and delivery of this Lease between Landlord and Tenant, for the sole
purpose of the Tenant's Work (the "Improvement Period"). Tenant's use of the
Property, including the Leased Premises, during the Improvement Period shall be
upon and subject to the following conditions:
1. During the Improvement Period, the Tenant, its servants, agents, employees,
contractors, subcontractors, officers and directors, shall be subject to
and bound by all of the terms and conditions of this Lease, including,
without limiting the generality of the foregoing, all insurance and
indemnification obligations of Tenant, subject only to the following:
(a) During the Improvement Period, the Tenant shall not be obligated to
pay Basic Rent (except as otherwise provided herein); and
(b) In the event the Tenant commences to conduct Tenant's business from
the Leased Premises during the Improvement Period, all Basic Rent
shall commence form the date of such commencement, notwithstanding
that the Term has not yet begun.
(c) [Intentionally Deleted].
2. Should Tenant enter upon the Property, including the Leased Premises, under
the terms of this Schedule "I" during the Improvement Period, it is hereby
-----------
agreed that Tenant, and Tenant's servants, agents, employees, contractors,
subcontractors, officers and directors or any other persons under Tenant's
control (collectively, "Tenant's Representatives"), shall be subject to the
direction of Landlord and Landlord's general contractor. If in the sole
and absolute discretion of Landlord, the presence of Tenant's
Representatives and their work interferes with the construction and
completion of the Landlord's Work or shall detrimentally affect Landlord's
ability to comply with Landlord's commitment for completing same or causes
any labor difficulties, Landlord shall have the right to order that portion
of the work of Tenant's Representatives, which is detrimental to Landlord,
to cease upon prior written notice to Tenant, and Landlord may also require
that Tenant and Tenant's Representatives remove from the Property all of
their tools, equipment and materials.
3. Except as otherwise provided in Paragraph 1(b) of this Schedule "I,"
-----------
Tenant's use of the Property, including the Leased Premises, during the
Improvement Period shall not be deemed the taking of possession of the
Leased Premises by Tenant for the purposes of either setting or
establishing the Commencement Date.
I-1
SCHEDULE "K"
INCREASES IN BASIC RENT
1. Notwithstanding anything to the contrary set forth in Paragraph 3 or
elsewhere in this Lease, and following August 31, 1998, the Basic Rent payable
by Tenant for the Leased Premises shall be increased in accordance with the
following:
(a) Commencing on September 1, 1998 and continuing through and including
August 31, 1999, the Basic Rent shall increase to approximately
US$261,300.00 per annum in lawful money of the jurisdiction in which the
Leased Premises are located, payable in equal monthly installments of
approximately US$21,775.00 each (which shall equal and reflect US$1.30 per
rentable square foot multiplied by the total rentable square feet of the
Leased Premises), in advance on the first (1st) day of each month during
the initial Term, with the first payment to be made on September 1, 1998;
(b) Commencing on September 1, 1999 and continuing through and including
August 31, 2000, the Basic Rent shall increase to approximately
US$271,350.00 per annum in lawful money of the jurisdiction in which the
Leased Premises are located, payable in equal monthly installments of
approximately US$22,617.50 each (which shall equal and reflect US$1.35 per
rentable square foot multiplied by the total rentable square feet of the
Leased Premises), in advance on the first (1st) day of each month during
the initial Term, with the first payment to be made on September 1, 1999;
(c) Commencing on September 1, 2000 and continuing through and including
August 31, 2001, the Basic Rent shall increase to approximately
US$281,400.00 per annum in lawful money of the jurisdiction in which the
Leased Premises are located, payable in equal monthly installments of
approximately US$23,450.00 each (which shall equal and reflect US$1.40 per
rentable square foot multiplied by the total rentable square feet of the
Leased Premises), in advance on the first (1st) day of each month during
the initial Term, with the first payment to be made on September 1, 2000;
(d) Commencing on September 1, 2001 and continuing through and including
August 31, 2002, the Basic Rent shall increase to approximately
US$291,450.00 per annum in lawful money of the jurisdiction in which the
Leased Premises are located, payable in equal monthly installments of
approximately US$24,287.50 each (which shall equal and reflect US$1.45 per
rentable square foot multiplied by the total rentable square feet of the
Leased Premises), in advance on the first (1st) day of each month during
the initial Term, with the first payment to be made on September 1, 2001;
(e) Commencing on September 1, 2002 and continuing through and including
August 31, 2003, the Basic Rent shall increase to approximately
US$301,500.00 per annum in lawful money of the jurisdiction in which the
Leased Premises are located, payable in equal monthly installments of
approximately US$25,125.00 each (which shall equal and reflect US$1.50 per
rentable square foot multiplied by the total rentable square feet of the
Leased Premises), in advance on the first (1st) day of each month during
the initial Term, with the first payment to be made on September 1, 2002;
(f) Commencing on September 1, 2003 and continuing through and including
August 31, 2004, the Basic Rent shall increase to approximately
US$311,550.00 per annum in lawful money of the jurisdiction in which the
Leased Premises are located, payable in equal monthly installments of
approximately US$25,962.50 each (which shall equal and reflect US$1.55 per
rentable square foot multiplied by the total rentable square feet of the
Leased Premises), in advance on the first (1st) day of each month during
the initial Term, with the first payment to be made on September 1, 2003;
(g) Commencing on September 1, 2004 and continuing through and including
August 31, 2005, the Basic Rent shall increase to approximately
US$321,600.00 per annum in lawful money of the jurisdiction in which the
Leased Premises are located, payable in equal monthly installments of
approximately US$26,800.00 each (which shall equal and reflect US$1.60 per
rentable square foot multiplied by the total rentable square feet of the
Leased Premises), in advance on the first (1st) day of each month during
the initial Term, with the first payment to be made on September 1, 2004;
(h) Commencing on September 1, 2005 and continuing through and including
August 31, 2006, the Basic Rent shall increase to approximately
US$331,650.00 per annum in lawful money of the jurisdiction in which the
Leased Premises are located, payable in equal monthly installments of
approximately US$27,637.50 each (which shall equal and reflect US$1.65 per
rentable square foot multiplied by the total rentable square feet of the
Leased Premises), in advance on the first (1st) day of each month during
the initial Term, with the first payment to be made on September 1, 2005;
and
(i) Commencing on September 1, 2006 and continuing through and including
August 31, 2007, the Basic Rent shall increase to approximately
US$341,700.00 per annum in lawful money of the jurisdiction in which the
Leased Premises are located, payable in equal monthly installments of
approximately US$28,475.00 each (which shall equal and reflect US$1.70 per
rentable square foot multiplied by the total rentable square feet of the
Leased Premises), in advance on the first (1st) day of each month during
the initial Term, with the first payment to be made on September 1, 2006.
K-1
SCHEDULE "L"
RIGHT OF FIRST OPPORTUNITY TO LEASE
(a) Provided that the Tenant duly and regularly pays the Rent and any and
all other amounts required to be paid pursuant to this Lease and performs
each and every covenant, proviso and agreement on the part of the Tenant to
be paid, rendered, observed and performed herein, the Landlord hereby
grants to the Tenant the right of first opportunity to lease (herein called
the "Right of First Opportunity Lease") all of the then-available,
additional space located on the second (2nd) floor of the Building, as
outlined on the attached floor plan(s) marked Schedule "B-2" and attached
-------------
to this Lease (herein called the "Opportunity Space").
(b) The Right of First Opportunity of Lease shall be subject to the
Opportunity Space becoming vacant and available for lease. The Opportunity
Space shall be deemed "available for lease" only to the extent that such
space is not subject to a lease of another tenant(s) (i.e., right of
---
expansion, first offer, renewal or any other rights of a third party).
(c) The Landlord will notify the Tenant in writing (herein called the
"Notification") of the date on which the Opportunity Space will become
vacant and available for lease by the Tenant, subject to any existing
tenant of the Opportunity Space vacating on such date (herein called the
"Opportunity Space Commencement Date"). The Tenant must indicate its
intention to lease the Opportunity Space by giving notice in writing to the
Landlord within thirty (30) days after such Notification, failing which the
Right of First Opportunity to Lease shall automatically terminate and be of
no further force and effect, and Landlord will have the right to lease the
Opportunity Space to any third party.
(d) The Notification will be sent to the Tenant no later than seven (7)
months prior to the Opportunity Space Commencement Date.
(e) The expiration date of the term of the lease for the Opportunity Space
shall coincide with the Expiration Date of this Lease or the applicable
Renewal Term, if exercised.
(f) The Basic Rent per square foot for the Opportunity Space shall be at
the Fair Market Rental Rate, as reasonably determined by Landlord and
Tenant solely in accordance with Paragraph (c) of Schedule "H" attached
-----------
hereto (without the use of the appraisal/arbitration procedures set forth
in Paragraph (d) of such Schedule "H").
-----------
(g) Landlord shall give written notice of Landlord's determination of the
Fair Market Rental Rate to Tenant concurrently with Landlord's delivery of
the Notification to Tenant. Thereafter, the Basic Rent per square foot for
the Opportunity Space shall be agreed upon between the Landlord and the
Tenant in writing within sixty (60) days after the Notification, failing
which the Right of First Opportunity to Lease as to the specific
Opportunity Space may, at Landlord's option, automatically terminate and be
of no further force and effect, and the Landlord will have the right to
lease the Opportunity Space to any third party.
(h) The Opportunity Space shall be subject to the same terms and
conditions as in this Lease, except that there will be no Landlord's Work,
no Tenant Improvement Allowance, and the Tenant's Proportionate Share will
be increased accordingly.
(i) Subject to Tenant's prior inspection, the Tenant agrees to accept the
Opportunity Space in its then-current "AS/IS-WHERE/IS" condition "WITH ALL
FAULTS" as of the Opportunity Space Commencement Date.
(j) The Tenant agrees to execute the Landlord's commercially reasonable
lease amendment agreement then, at the Opportunity Space Commencement Date,
being used by the Landlord for the Building to give effect to the Right of
First Opportunity to Lease, if exercised by the Tenant.
(k) Notwithstanding the above, if the Tenant does not exercise the Right
of First Opportunity to Lease in accordance with this Schedule "L", then
------------
the Right of First Opportunity to Lease shall automatically terminate and
be of no further force and effect, and Landlord will have the right to
lease the Opportunity Space to any third party.
L-1
SCHEDULE "M"
LETTER OF CREDIT
(a) Concurrent with Tenant's execution and delivery of this Lease to
Landlord and Tenant's delivery of the Security Deposit pursuant to
Paragraph 4 of this Lease, and as additional security for the payment and
performance by the Tenant of all Debts, Liabilities and Obligations and all
of Tenant's other obligations arising under or in connection with this
Lease, Tenant hereby agrees to deliver to Landlord a fully-executed,
original standby, irrevocable "Letter of Credit" from, and to be honored
by, the main office of Silicon Valley Bank located at 0000 Xxxxxx Xxxxx,
Xxxxx Xxxxx, Xxxxxxxxxx 00000 Attn: International Department (the "Bank"),
in the amount of Two Hundred Thousand Dollars (US$200,000.00) in favor of
Landlord, as "beneficiary," and dated as of the date of this Lease, which
Letter of Credit shall be available to Landlord upon Landlord's draft(s) to
be accompanied only by the following: (i) a signed statement or other
----
writing from the then-current Director of Real Estate for Landlord's local
office set forth on the first page of this Lease, confirming that a default
or breach by the Tenant has occurred under this Lease, and (ii) the
original, fully-executed Letter of Credit presented for endorsement with
each draft or draw requested and, thereafter, immediately returned to
Landlord by the Bank; provided, however, and although the Letter of Credit
will be renewed annually by Tenant through and including August 31, 2000,
the Letter of Credit may be decreased thereafter in accordance with the
following: (A) on September 1, 2000, the amount of the Letter of Credit may
be decreased by Tenant to One Hundred Fifty Thousand Dollars
(US$150,000.00); (B) on September 1, 2002, the amount of the Letter of
Credit may be decreased by Tenant to One Hundred Thousand Dollars
(US$100,000.00); (C) on September 1, 2002, the amount of the Letter of
Credit may be decreased by Tenant to Fifty Thousand Dollars (US$50,000.00);
and on and after September 1, 2003, Tenant shall no longer be obligated to
renew and/or deliver the Letter of Credit to Landlord. Tenant hereby
acknowledges and agrees that, as of the date of this Lease, Tenant has
reviewed and approved the form of the Letter of Credit, and Tenant hereby
also agrees, as the "applicant" and/or the "account party," to be bound by
all of the terms, covenants and conditions of the Letter of Credit.
(b) Landlord hereby agrees to accept an annually renewable Letter of
Credit for the purposes set forth herein; provided, that the Bank agrees to
notify Landlord and Tenant by certified mail at least sixty (60) days in
advance of the expiration of each twelve (12)-month term (or other term) of
the Letter of Credit, if the Bank intends not to renew the Letter of
Credit. In the event that the Bank intends not to renew the Letter of
Credit, Tenant hereby agrees to provide a substitute Letter of Credit in
like amount drawn from one of the three (3) then-largest commercial lending
institutions in the State of California (i.e., Bank of America, Xxxxx
----
Fargo, etc.) or to provide Landlord with the required amount of cash in
lieu of the new Letter of Credit no later than thirty (30) days prior to
the expiration of the existing Letter of Credit. In the event a replacement
Letter of Credit or the required cash amount is not provided or paid by
Tenant by the time specified herein, then Landlord may declare Tenant in
default of this Lease, and, in addition to all of Landlord's rights and
remedies herein provided, Landlord may draw down payment under the existing
Letter of Credit.
M-1
SCHEDULE "N"
MISCELLANEOUS
1. Security. Landlord does not warrant, represent or guaranty, in any manner
--------
whatsoever, to protect Tenant and/or Tenant's Representatives or property from
loss or injury in, on or about the Leased Premises, the Building and/or the
Property. Subject to Landlord having access to, and Landlord's prior written
approval of, any Tenant security system and its installation, along with the
satisfaction of all other applicable provisions of this Lease, Tenant may, at
Tenant's sole cost and expense (except as otherwise provided in this Lease),
install reasonable security measures and systems in the Leased Premises, and
Tenant is encouraged by Landlord to do so, including, but not limited to,
Tenant's video surveillance cameras and security system set forth as part of
Tenant's Work in Paragraph 5(a)(vi) on Schedule "F" attached hereto.
------------
2. Antenna and Satellite Dish. Tenant may install, from time to time during
--------------------------
the Term, and maintain, up to two (2) lightweight antennas (pole type, not to
exceed 1-1/2" in diameter and not to be greater than 15' in height from the roof
of the Building), eight (8) lightweight aluminum satellite dishes (not to exceed
3' in diameter and not to be greater than 3' in height from the roof of the
Building), and six (6) HVAC condensers and other forms of equipment
(collectively, the "Antennas"), to be located on one thousand two hundred square
feet (1,200) of space on the roof of the Building, at no additional cost to
Tenant, in accordance with this Lease and all of the following:
(a) Notwithstanding anything to the contrary set forth in this Lease, and
upon and subject to the terms and conditions provided below, Tenant may, at
Tenant's option and at Tenant's sole cost and expense (except as otherwise
provided in this Lease), install, maintain and operate the Antennas (and
all related equipment with non-penetrating roof mounts) on the roof of the
Building in a location reasonably approved in writing by Landlord.
(b) Landlord shall have no responsibility for and shall not be obligated to
provide any utilities, including, but not limited to, electricity or other
power for the operation of the Antennas. tenant shall procure the
arrangement of all utility services to be sued in connection with the
Antennas with the appropriate local utility companies, which arrangements,
other than the cost and expense of same, shall be subject to the written
approval of Landlord, which approval shall not be unreasonably withheld or
delayed. Tenant shall directly pay for the cost of all such utility
services in accordance with Schedule "D" attached hereto.
------------
(c) Prior to the installation and operation of the Antennas, Tenant shall
obtain, and shall thereafter at all times maintain, all permits,
certificates and approvals required by applicable federal, state and local
laws, ordinances and agencies in connection with or related to the
installation, operation and maintenance of the Antennas. Upon request at
any time by Landlord, Tenant shall produce such permits, certificates and
approvals for inspection by Landlord or Landlord's authorized
representative. Tenant shall promptly pay any taxes and license fees
imposed by applicable federal, state or local governmental agencies in
connection with the Antennas for any reason whatsoever. Tenant's failure
to obtain any such permit, certificate or approval shall not entitle Tenant
to any rent abatement, right to terminate or nay other remedy under this
lease or to otherwise with respect to Landlord; it being acknowledged and
agreed that Landlord has made no representation nor warranty, either
express or implied with respect to whether any such permits, certificates
or approvals shall be required or, if required, whether they may be
obtained and, if so, at what cost and how quickly.
(d) Tenant shall maintain the Antennas, at Tenant's own cost and expense,
in good working order and condition an free form any hazard to person
and/or property. Tenant shall not place any load upon the roof of the
Building which will exceed the load per square foot which the roof was
designed to carry. Upon written request from Tenant, Landlord shall
provide Tenant with such information, as may be in Landlord's actual
possession, that Tenant may reasonably require to properly distribute any
load on the roof of the Building. Any damage caused to the Building or any
part thereof which results from the installation, operation, maintenance,
repair, replacement or removal of the Antennas shall be promptly repaired
or replaced by Tenant, under Landlord's reasonable supervision (if Landlord
elects) and at Tenant's sole cost and expense.
(e) Subject to Exhibit "I" attached hereto, Landlord hereby grants to
-----------
Tenant the limited right to enter upon and have access to and from the roof
of the Building, at reasonable times, for the purposes of installation,
maintenance and/or removal of the Antennas, as permitted hereunder.
Landlord agrees not to unreasonably interfere with the Antennas, subject to
any repairs, replacements, alternation or additions required to be
performed with respect to the roof of the Building by Landlord or at the
request of any governmental authority or agency.
(f) Tenant's Antennas shall not exceed the height restriction of any zoning
ordinance, agreement with any other tenant/lessee, restrictive covenant or
recorded instrument or building or fire safety code affecting the Building
and/or the Property, and shall not be installed or maintained in a manner
which would void or negate Landlord's roof warranty, if any, or the
structural integrity of the Building, including the roof. In addition,
Tenant's plans and specifications treated to the method and manner of the
construction, installation and maintenance of the Antennas shall be subject
to Schedule "F" attached hereto; provided, that Landlord's approval of the
------------
specifications and other items shall not constitute the assumption of any
responsibility by
N-1
Landlord for the accuracy or sufficiency of any specifications, drawings or
other information covered thereby, and Tenant shall be solely responsible
therefor. The giving of any such approval shall not eliminate any of
Tenant's obligations hereunder, including, without limitation, Tenant's
obligation to obtain all required permits and compliance with all codes and
insurance requirements set forth in this Lease and as set forth herein.
(g) Tenant hereby agrees to indemnify, defend (with counsel reasonably
acceptable to Landlord) and hod harmless Landlord, the Leased Premises, the
Building and the Property from and against any and all loss, cost, injury,
claim, demand, cost and expense of every kind and nature (including
reasonable attorneys' fees and costs, and court costs) which arise form
tenant's use of the roof of the building and/or Tenant's Antennas for any
reason whatsoever or any breach or default on the part of Tenant in the
performance of any agreement of Tenant to be performed pursuant to the
terms set forth herein.
3. Signage. Notwithstanding anything to he contrary set forth in this Lease,
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Tenant shall be entitled to one (1) non-illuminated, exterior sign to be located
on the western facing exterior parapet of the Building, and certain signage on
the exterior, main entrance doors to the Leased Premises and upon the directory
board of the Building, if available, all in a location, appearance, size,
material, lettering and styling as is currently customary and available for the
Building, if at all, which signage shall be installed, maintained, repaired and
removed from the Building and/or the Property, at Tenant's sole cost an expense,
subject to the applicable terms, covenants and conditions set forth herein or as
otherwise set forth in this Lease. The appearance, size, material, lettering
and styling regarding Tenant's signage shall be consistent with the first-class
quality and character of the Building and the Property, shall remain subject to
the prior approval of Landlord and compliance with all applicable covenants,
conditions and restrictions, and other recorded instruments, affecting the
Building and/or the Property resulting from such removal. If Tenant fails to
remove such signage and repair any such damage to the Leased Premises the
building and/or the Property within thirty (30) days after Landlord's written
request therefor, then Landlord may perform such work, an all costs and expenses
incurred by the Landlord will be reimbursed by tenant within ten (10) business
days after Tenant's receipt of Landlord's written demand therefor.
4. Access. Subject to the terms, covenants and conditions of this Lease and as
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of the Commencement Date and thereafter, Tenant shall have access to the Leased
Premises twenty-four (24) hours per day, sever (7) days per week.
N-2
PARKING AGREEMENT
THIS AGREEMENT is made this 27th day of June, 1997, BY AND BETWEEN: EXODUS
COMMUNICATIONS, INC., a California corporation (hereinafter called the
"Licensee"), OF THE FIRST PART, and THE MANUFACTURERS LIFE INSURANCE COMPANY
(U.S.A.), a Michigan corporation (hereinafter called "Manufacturers"), OF THE
SECOND PART,
WHEREAS, by lease (the "Lease") dated June 27, 1997, the Licensee leased
from Manufacturers the "Leased Premises" located on the first (1st) floor of the
Building" known as 72 Corporate Park in the City of Irvine, State of California
92606, and in connection therewith wishes to park automobile(s) in the parking
lot/structure adjacent to the Building.
NOW, THEREFORE, in consideration of TWO ($2.00) DOLLARS now paid by the
Licensee to Manufacturers, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. Manufacturers grants to License the right to sixty-two (62) non-reserved
parking spaces (which will not including any such spaces designated for the UPS
Generators and the Electrical Service Upgrade) (as such terms are defined in the
Lease), the a term commencing on the Commencement Date of the Lease. Licensee
agrees to park only in those spaces designated for Licensee, at no charge to
Licensee; provided, however, Licensee shall pay for any future reasonable
parking charges imposed by any governmental or quasi-governmental authority
during the Term, including any Renewal Term (as defined in the Lease).
2. Licensee agrees to indemnify, defend (with counsel reasonably acceptable to
Manufacturers), and hold harmless Manufacturers and the Property from and
against all liabilities, claims, damages or expense (including attorneys' fees
and costs, and court costs) due to or arising out of any act, omission or
neglect by the Licensee, his or its agents, servants, invitees or licensees on
or about the said parking area or due to or arising out of any breach by the
Licensee of the provisions of this Agreement or of the "Parking Rules" (as
hereinafter defined).
3. The Licensee agrees to comply with such rules (the "Parking Rules") as may
be established, from time to time, by Manufacturers covering the use of the said
parking area.
4. Manufacturers shall not be liable for any loss, injury or damage caused to
persons using the parking area or to automobiles or their contents or any other
property thereon, however caused, and the Licensee agrees that such vehicles,
contents and Property shall be in the parking area at the sole risk of the
Licensee.
5. Payment, if any, required to be made by the Licensee herein shall be paid
monthly in advance on the first day of each month, but shall be net of any
parking tax or assessment by the authorities of competent jurisdiction not
controlled by Manufacturers, and any such parking taxes or assessment so imposed
shall be paid by the Licensee on demand by Manufacturers.
-1-
6. It is acknowledged that the parking cards or keys (if any) are the property
of Manufacturers and are to be returned upon the expiration or earlier
termination of this Agreement. Inoperative cards or keys will be replaced at no
charge, but lost cards or keys will be replaced at a cost established by
Manufacturers from time to time.
IN WITNESS WHEREOF, Licensee and Manufacturers have executed this Agreement
as of the date set forth on page 1 hereof.
Licensee:
EXODUS COMMUNICATIONS, INC.,
a California corporation
By: /s/ Xxxxxxx Xxxxxx
--------------------------------------------
Name: Xxxxxxx Xxxxxx
Title: Chief Operating Officer and
Chief Financial Officer
Manufacturers:
THE MANUFACTURERS LIFE INSURANCE COMPANY (U.S.A.),
a Michigan corporation
By:/s/ Xxxxxx X. Xxxxxx
--------------------------------------------
Name: Xxxxxx X. Xxxxxx
-------------------------------------
Title: Regional Director, AVP
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-2-
