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EXHIBIT 10.10
AMENDMENT NO. 2 TO SUBLEASE AGREEMENT BETWEEN ARGOSYSTEMS, INC. AND GENERAL
MAGIC, INC.
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This Amendment No. 2 ("Amendment") to Sublease Agreement (the "Sublease")
between ARGOSystems, Inc., as Sublessor (hereinafter, "Sublessor"), and General
Magic, Inc., as Sublessee (hereinafter, "Sublessee"), for the Premises located
at ▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ("Building 11"), which Sublease was
dated April 12, 1994 for reference purposes only (and was thereafter amended
and partially terminated by Amendment No. 1 entered into as of April 1, 1997),
is made and entered into as of January 1, 1998. Sublessee has heretofore
properly exercised its expansion option (hereinafter, the "Expansion Option")
pursuant to Paragraph 36 of the Sublease. Sun Microsystems, Inc. (hereinafter,
"Sun"), pursuant to the terms of its sublease with ARGOSystems, Inc., as
amended, dated as of November 1, 1996, which sublease was for the Premises
located in Sunnyvale, California at ▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇ ("Building 12") and ▇▇▇
▇. ▇▇▇▇ ▇▇▇▇▇▇ ("Building 10"), and the Sublease, as amended, has exercised its
right of first refusal with respect to 27,033 square feet of rentable space. In
connection with Sublessee's exercise of its Expansion Option and Sun's exercise
of its right of first refusal, and prior to or concurrently with the execution
hereof, the parties hereto, along with Sun, have executed an agreement,
entitled, "Agreement Regarding General Magic Expansion Option" (hereinafter, the
"Agreement"), which Agreement is attached hereto as Exhibit A and is
incorporated herein by reference. This Amendment also includes the Rent Schedule
which identifies the rent obligations for Sublessee and Sun with respect to
Building 11 and the rent obligation of Sun as to the First Floor of Building 10,
and which Rent Schedule is attached hereto as Exhibit B and is incorporated
herein by reference. In consideration of the mutual promises, covenants, and
conditions as hereinafter provided and as provided in the Agreement attached
hereto, Sublessor and Sublessee do agree to the following provisions, which
amend the Sublease, as follows:
1. In accordance with the Agreement, and specifically paragraph 1
thereof, Sublessor hereby delivers to Sublessee, in response to Sublessee's
exercise of its Expansion Option, 38,862 square feet on the first floor of
Building 10 (the "Expansion Option Space"). Of this Expansion Option Space,
Sublessee, pursuant to the Agreement, hereby surrenders 27,033 sq. ft., that
would otherwise have been available for sublease by Sublessee, to Sublessor
pursuant to Sublessor's Right of First Refusal under the Sublease. Sublessor,
in turn, is making this space available to Sun pursuant to Sun's Right of First
Refusal in its sublease. In exchange, Sun is surrendering to Sublessor, 11,829
rentable square feet on the first floor of Building 11 (420 North ▇▇▇▇ Avenue,
Sunnyvale, CA) (hereinafter, the "Additional General Magic Space"). Sublessor,
(pursuant to the Agreement) hereby delivers to Sublessee the Additional General
Magic Space for Sublessee's use and occupancy, receipt of such delivery being
hereby acknowledged by Sublessee. Also pursuant to the Agreement, Sublessee is
surrendering 11,829 sq. ft. on the first floor of Building 10 to Sublessor,
which space Sublessor, in turn, is making available to Sun for Sun's use and
occupancy.
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2. In accordance with the Agreement, and specifically paragraph 3
thereof, Sublessee delivers to Sublessor, for delivery to Sun, the 27,033
square feet of rentable space (hereinafter, the "Additional Sun Space") which
would otherwise have been transferred to Sublessee as a result of the exercise
of Expansion Option. Sublessee hereby accepts delivery from Sublessor through
Sun of the Additional General Magic Space. Sublessor and Sublessee agree that
the Additional General Magic Space shall be included in the Premises subleased
by Sublessee under the Sublease for the period from January 1, 1998 through the
end of the Sublease term.
3. The Sublease is hereby amended consistent with all of the terms of
the attached Agreement applicable to the Sublease, including but not limited to
the terms of the attached Agreement concerning: Sublessee's obligation to pay
the Rent for the Additional General Magic Space specified in paragraph 36 of
the Sublease (as provided in Paragraph 4(1) of the attached Agreement and as
provided in the Rent Schedule attached hereto as Exhibit B); Sublessee's right
to receive Rebate Rent (as defined in Amendment No. 1 to the Sublease) for the
Additional Sun Space (as provided in Paragraph 4(2) of the Agreement and as
provided in the Rent Schedule attached hereto as Exhibit B); the satisfaction
of obligations under the Sublease with respect to the exercise of the General
Magic Expansion Option (as provided in paragraph 4 of the attached Agreement);
the effect of Sublessee's exercise of the Expansion Option on Sublessee's
obligations to furnish a Security Deposit (Paragraph 4(4) of the attached
Agreement); and the effect of Sublessee's exercise of the Expansion Option upon
Sublessee's non-exclusive rights to parking (as provided in Paragraph 5 of the
attached Agreement).
4. Sublessor represents and warrants to Sublessee that Sublessor has not
engaged any new broker in connection with this transaction. Sublessor agrees to
indemnify, defend, and hold harmless Sublessee from any and all liabilities,
claims, damages, costs or attorneys' fees arising out of Sublessor's breach of
the foregoing warranty and representation.
5. Sublessee represents and warrants to Sublessor that Sublessee has not
engaged any broker in connection with this transaction. Sublessee agrees to
indemnify, defend, and hold harmless Sublessor from any and all liabilities,
claims, damages, costs or attorneys' fees arising out of Sublessee's breach of
the foregoing warranty and representation.
6. This Amendment shall become effective upon its execution by Sublessor
and Sublessee, upon execution of the Consent of Landlord thereto, upon
execution of the Second Amendment to Sublease dated as of January 1, 1998 as
between ARGOSystems, Inc., as sublessor, and Sun Microsystems, Inc., as
sublessee, and upon execution of the Consent of Landlord to such Second
Amendment.
7. This Amendment may be executed in any number of counterparts, each of
which shall be deemed an original, and when taken together shall constitute one
and the same agreement.
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EXCEPT AS EXPRESSLY MODIFIED HEREIN AND PURSUANT TO THE TERMS OF THE
AGREEMENT ATTACHED HERETO AS EXHIBIT A AND THE RENT SCHEDULE ATTACHED HERETO AS
EXHIBIT B, all other terms, covenants, and conditions of the April 12, 1994
Sublease between the parties hereto, as said Sublease was amended and partially
terminated by Amendment No. 1 entered into as of April 1, 1997, shall remain
unmodified and in full force and effect.
IN WITNESS WHEREOF, Sublessor and Sublessee have executed this Amendment
No. 2 to Sublease Agreement as of January 1, 1998.
SUBLESSOR: SUBLESSEE:
ARGOSYSTEMS, INC., GENERAL MAGIC, INC.,
a California Corporation a Delaware Corporation
By: /s/ SIGNATURE ILLEGIBLE By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Title: Title: Vice President Finance
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CONSENT OF LANDLORD
The ▇▇▇▇▇▇-▇▇▇▇ Limited Partnership, Lessor under the Master Lease with
ARGOSystems, Inc., Lessee, dated as of November 25, 1987, hereby consents to
the foregoing Amendment No. 2 to Sublease Agreement between ARGOSystems, Inc.,
Sublessor, and General Magic, Inc., Sublessee, entered into as of January 1,
1998.
The ▇▇▇▇▇▇-▇▇▇▇ Limited Partnership,
a California Limited Partnership
By: /s/ SIGNATURE ILLEGIBLE
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▇▇▇ ▇▇▇▇, Managing General Partner
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AGREEMENT REGARDING GENERAL MAGIC EXPANSION OPTION
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ARGOSystems, Inc., a California Corporation ("ARGOSystems"), General Magic,
Inc., a Delaware Corporation ("General Magic"), and Sun Microsystems, Inc., a
Delaware Corporation ("Sun"), hereby agree to the following:
Recitals
a. WHEREAS, ARGOSystems, as sublessor, and Sun, as sublessee, entered
into a written sublease agreement dated November 1, 1996, which sublease was
thereafter amended as of April 1, 1997. (Said sublease, as amended, is
hereinafter referred to as the "Sun Sublease.")
b. WHEREAS, ARGOSystems, as sublessor, and General Magic, as sublessee,
entered into a written sublease agreement dated April 12, 1994, which sublease
was thereafter amended as of April 1, 1997. (Said sublease, as amended, is
hereinafter referred to as the "General Magic Sublease.")
c. WHEREAS, the Sun Sublease and General Magic Sublease, collectively,
generally concern certain real property located in Sunnyvale, California,
having the street addresses of ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ("Building 12"), ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ("Building 11"), and ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ("Building 10").
d. WHEREAS, as of December 31, 1997, Sun and General Magic occupy the
following portions of Buildings 10, 11, and 12.
(1) Sun occupies all three floors of Building 12, consisting of
approximately 116,586 square feet;
(2) Sun occupies approximately one and one-third floors of Building
11, consisting of the entire second floor (approximately 38,862 square feet),
and 12,693 square feet of space on the first floor (including 10,966 square
feet plus 1,727 square feet of shared allocation of common area);
(3) General Magic occupies approximately one and two-thirds floors
of Building 11, consisting of the entire third floor (approximately 38,862
square feet), and approximately 26,169 square feet of the first floor; and
(4) Sun occupies two and one-half floors of Building 10, consisting
of one-half of the first floor (approximately 19,431 square feet) (the
remainder of said floor being occupied through December 31, 1997 by Synopsys
pursuant to a sublease agreement with ARGOSystems), the entire second floor
(approximately 38,862 square feet), and the entire third floor (approximately
38,862 square feet).
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01/19/98 FINAL Page 1 of 5
EXHIBIT A
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AGREEMENT REGARDING GENERAL MAGIC EXPANSION OPTION
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e. WHEREAS, the parties contemplate that, effective January 1, 1998,
upon execution of this Agreement, the execution of the Second Amendment to Sun
Sublease (described below), and the execution of the Amendment No. 2 to the
General Magic Sublease (described below), the occupancy of Buildings 10, 11 and
12, irrespective of the question of to whom the premises are demised under the
two subleases, shall be as follows:
(1) Sun shall continue to occupy all of Building 12;
(2) Sun shall occupy one floor of Building 11, consisting of the
entire second floor, and Sun shall have access to that floor through the first
floor lobbies;
(3) General Magic shall occupy two floors of Building 11, consisting
of the entire third floor (approximately 38,862 square feet), and the entire
first floor subject to Sun's right of access (approximately 38,862 less 864, or
37,998 square feet); and
(4) Sun shall occupy all of Building 10.
f. WHEREAS, General Magic, pursuant to its letter dated September 18,
1997, exercised its Expansion Option pursuant to the terms of the General Magic
Sublease for an additional 38,862 sq. ft., of which it intended to occupy
11,829 sq. ft. and make available for sublease 27,033 sq. ft.; and
g. WHEREAS, Sun, through ARGOSystems, has exercised its Right of First
Refusal for this additional 27,033 sq. ft., and
h. WHEREAS, General Magic and Sun have agreed, through ARGOSystems, to
effectively exchange 11,829 sq. ft. of space that would otherwise have been
occupied by General Magic in Building 10 for an equal amount of space that Sun
will vacate on the first floor of Building 11; and
i. WHEREAS, the parties hereto, for good and valuable consideration,
receipt of which is hereby acknowledged, desire to memorialize their agreement
as it relates to General Magic's exercise of its Expansion Option as set forth
below.
Agreement
1. The terms used, but otherwise not defined, in this paragraph 1 shall
have the meanings given them in the Sun Sublease. Sun will deliver 38,862
rentable square feet on the first floor of Building 10 (the "Expansion Option
Space") to ARGOSystems, no later than January 1, 1998, in full and complete
satisfaction of Sun's obligation to deliver one floor of either Building 10 or
11 to ARGOSystems for the General Magic Expansion Option, pursuant to the Sun
Sublease. Of this Expansion Option Space, General Magic shall surrender 27,033
sq. ft.,
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01/19/98 FINAL Page 2 of 5
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AGREEMENT REGARDING GENERAL MAGIC EXPANSION OPTION
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that would otherwise have been available for sublease, to ARGOSystems pursuant
to ARGOSystems' Right of First Refusal under the General Magic Sublease.
ARGOSystems, in turn, shall make this space available to Sun pursuant to Sun's
Right of First Refusal under the Sun Sublease. Sun shall surrender 11,829 sq.
ft. on the first floor of Building 11 (hereinafter, the "Additional General
Magic Space") to ARGOSystems, which ARGOSystems shall make available for
General Magic's use and occupancy, and General Magic shall surrender 11,829
sq. ft. on the first floor of Building 10 to ARGOSystems, which ARGOSystems
shall make available for Sun's use and occupancy. Sun shall continue to have
access to approximately 864 square feet of shared common area on the first
floor to access the second floor of Building 11 through the first floor
lobbies, to access the mechanical closet, and for use of the first floor
restrooms and waiting areas.
2. In consideration of the covenants, conditions, and agreements herein,
and subject to General Magic's right to receive Rebate Rent as defined in the
General Magic Sublease for the Additional Sun Space (as defined below), delivery
by Sun and ARGOSystems to General Magic of the Additional General Magic Space
shall be in full satisfaction of any obligation arising under either the General
Magic Sublease or the Sun Sublease for either Sun or ARGOSystems to deliver
either the entire second floor of Building 11 or one entire floor of Building 10
in compliance with the exercise of the General Magic Expansion Option.
3. Pursuant to Paragraph 2 hereof, it is agreed that the remaining
27,033 square feet of rentable space (the "Additional Sun Space") which would
otherwise have been available for sublease by General Magic (pursuant to the
terms of the General Magic Sublease as a result of the exercise of the General
Magic Expansion Option) is transferred by General Magic to ARGOSystems for
delivery to Sun under the sublease right of first refusal provisions of the
General Magic Sublease and Sun Sublease. Sun hereby exercises its right under
the Sun Sublease to lease such remaining 27,033 rentable square feet, for the
period from January 1, 1998 through the remainder of the Sun Sublease term. Sun
and ARGOSystems will execute a Second Amendment to the Sun Sublease to remove
the Additional General Magic Space from Sun's Premises and to adjust the Rent
for the Additional Sun Space pursuant to the terms of the Sun Sublease.
4. The terms used in this paragraph 4, but not otherwise defined in this
Agreement, shall have the meanings given them in the General Magic Sublease. As
a result of General Magic's exercise of its Expansion Option under the General
Magic Sublease, and in full satisfaction of ARGOSystems' obligations under the
General Magic Sublease in response to the exercise of such General Magic
Expansion Option, ARGOSystems and General Magic hereby agree as follows:
(1) ARGOSystems agrees to deliver the Additional General Magic Space
to General Magic, effective January 1, 1998, and General Magic agrees to pay
the Rent specified in Section 36 of the General Magic Sublease therefor;
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01/19/98 FINAL Page 3 of 5
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AGREEMENT REGARDING GENERAL MAGIC EXPANSION OPTION
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(2) ARGOSystems shall pay General Magic Rebate Rent with respect to
the Additional Sun Space in accordance with the schedule provided in Amendment
No. 1 to the General Magic Sublease, Paragraph 2.
(3) In consideration of the promises, covenants, and conditions
contained in this agreement, General Magic specifically waives any right under
the General Magic Sublease, including but not limited to Paragraph 36 of the
Sublease, to claim from ARGOSystems a tenant improvement allowance of $7.50 per
square foot (or of any other amount), in connection with the Additional General
Magic Space and/or Additional Sun Space referenced in this agreement.
(4) In consideration of the promises, covenants, and conditions
contained in this agreement, ARGOSystems specifically waives any right under the
General Magic Sublease to require that the Security Deposit furnished by General
Magic under the Sublease be increased in any amount to reflect additional square
footage leased by General Magic pursuant to this agreement.
ARGOSystems and General Magic will execute an Amendment No. 2 to the General
Magic Sublease to reflect the foregoing agreement.
5. Notwithstanding anything to the contrary in General Magic Sublease
and the Sun Sublease, and in order to allocate equitably between General Magic
and Sun the parking spaces required by each as a result of the change in the
amount of square footage subleased by said parties after this agreement becomes
effective, the parties to this agreement hereby agree that General Magic and
Sun, respectively, shall have non-exclusive rights to parking spaces (for
Building 11) as follows:
(1) General Magic shall have non-exclusive rights to a total of 287
parking spaces, located in the Common Area as defined in the original Sublease.
(2) Sun shall have non-exclusive rights to 3.7 parking spaces per
1,000 rentable square feet leased (147 parking spaces) located in the Common
Area as defined in the original General Magic Sublease, and, in addition,
ARGOSystems will continue to allocate 15 non-exclusive parking spaces to Sun in
the parking lot of ▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇ as specified in the First Amendment to
the Sun Microsystems Sublease Agreement.
(3) In the event General Magic exercises its rights under Paragraph
34 of the General Magic Sublease to designate up to twenty (20) parking spaces
for its sole use, General Magic shall release six (6) of these spaces
back to ARGOSystems. ARGOSystems shall provide these six (6) spaces to Sun,
which Sun shall have the right to designate for its exclusive use.
6. This Agreement shall become binding upon execution by all three
parties, and upon consent by Landlord, and sets forth the intentions and
understanding of the parties as to the subject matter hereof. All of the parties
acknowledge that Sun may rely on this agreement to
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01/19/98 FINAL Page 4 of 5
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AGREEMENT REGARDING GENERAL MAGIC EXPANSION OPTION
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proceed with significant expenditures to replan the location of its new lab from
the first floor of ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ to the first floor of ▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇. All of the parties agree to use best efforts to reach agreement on
commercially reasonable amendments to the Sun Sublease and the General Magic
Sublease as soon as practicable.
Agreed and Accepted: Agreed and Accepted:
GENERAL MAGIC, INC. ARGOSystems, INC.,
a Delaware Corporation a California Corporation
By: ________________________ By: __________________________
Its: _______________________ Its: _________________________
Date: ______________________ Date: ________________________
Agreed and Accepted: Consent of Landlord:
SUN MICROSYSTEMS, INC. THE ▇▇▇▇▇▇-▇▇▇▇ LIMITED
a Delaware Corporation PARTNERSHIP,
a California Limited Partnership
By: ________________________ By: __________________________
Its: _______________________ Its: _________________________
Date: ______________________ Date: ________________________
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01/19/98 FINAL PAGE 5 OF 5
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SECOND AMENDMENT TO SUBLEASE AGREEMENT EXHIBIT B
BETWEEN ARGOSYSTEMS, INC., SUBLESSOR, AND
GENERAL MAGIC, INC., SUBLESSEE
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SUN MICROSYSTEMS RENT OBLIGATIONS/BUILDING 11
AFTER JANUARY 1, 1998 EXPANSION OPTION
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Dates Sq. Footage Rental Rate Total Rent Rebate Rate Total Rebate
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1/1/98 - 3/31/98 39,726 $2.20 $ 87,397.20 $0.575 $22,842.45
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4/1/98 - 3/31/99 39,726 $2.30 $ 91,369.80 $0.625 $24,828.75
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4/1/99 - 6/30/99 39,726 $2.40 $ 95,342.40 $0.675 $26,815.05
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7/1/99 - 3/31/00 39,726 $2.40 $ 95,342.40 $0.650 $25,821.90
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4/1/00 - 6/30/00 39,726 $2.50 $ 99,315.00 $0.700 $27,808.20
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7/1/00 - 3/31/01 39,726 $2.50 $ 99,315.00 $0.650 $25,821.90
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4/1/01 - 6/30/02 39,726 $2.60 $103,287.60 $0.700 $27,808.20
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GENERAL MAGIC RENT OBLIGATIONS/BUILDING 11
AFTER JANUARY 1, 1998 EXPANSION OPTION
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Dates Sq. Footage Rental Rate Total Rent
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1/1/98 - 6/30/99 76,860 $1.05 $ 80,703.00
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7/1/99 - 6/30/00 76,860 $1.10 $ 84,546.00
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7/1/00 - 6/30/02 76,860 $1.20 $ 92,232.00
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SUN MICROSYSTEMS RENT ▇▇▇▇▇▇▇▇▇▇▇/▇▇▇▇▇▇▇▇ ▇▇ (▇▇▇▇▇ ▇▇▇▇▇)*
AFTER JANUARY 1, 1998 EXPANSION OPTION
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Rent for this
Dates Sq. Footage Rental Rate Portion Rebate Rate Total Rebate
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1/1/98 - 3/31/98 38,862 $2.20 $ 85,496.40 $0.575 $22,345.65
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4/1/98 - 3/31/99 38,862 $2.30 $ 89,382.60 $0.625 $24,288.75
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4/1/99 - 6/30/99 38,862 $2.40 $ 93,268.80 $0.675 $26,231.85
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7/1/99 - 3/31/00 38,862 $2.40 $ 93,268.80 $0.650 $25,260.30
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4/1/00 - 6/30/00 38,862 $2.50 $ 97,155.00 $0.700 $27,203.40
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7/1/00 - 3/31/01 38,862 $2.50 $ 97,155.00 $0.650 $25,260.30
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4/1/01 - 6/30/02 38,862 $2.60 $101,041,20 $0.700 $27,203.40
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MONTHLY FIGURES AFTER EXPANSION OPTION
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General Magic
Dates Sun Rent* Rent Rebate Total
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1/1/98 - 3/31/98 $172,893.60 $80,703.00 $45,188.10
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4/1/98 - 3/31/99 $180,752.40 $80,703.00 $49,117.50
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4/1/99 - 6/30/99 $188,611.20 $80,703.00 $53,046.90
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7/1/99 - 3/31/00 $188,611.20 $84,546.00 $51,082.20
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4/1/00 - 6/30/00 $196,470.00 $84,546.00 $55,011.60
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7/1/00 - 3/31/01 $196,470.00 $92,232.00 $51,082.20
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4/1/01 - 6/30/02 $204,328.80 $92,232.00 $55,011.60
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* Remainder of Building 10 (116,586 - 38,862) will be paid by Sun at Master
Lease Rate after Expansion.
EXHIBIT B
