1
EXHIBIT 10.5
STANDARD OFFICE LEASE
This Lease is made and entered into as of March 25, 1999 by and between
Central Building LLC, a limited liability corporation ("Landlord"), and
Cybergold, Inc., a California corporation ("Tenant"), who agree as follows:
1. DEFINITIONS.
As used in this Lease, the following terms shall have the following
meanings specified below:
1.1 Base Rent: Subject to any adjustment provided for herein:
Year 1: $1.55 per rentable square foot per month
Year 2: $1.60 per rentable square foot per month
Year 3: $1.80 per rentable square foot per month
Year 4: $1.95 per rentable square foot per month
Year 5: $2.00 per rentable square foot per month
1.2 Base Year: The calendar year of 1999.
1.3 Building: The building and other improvements on the real
property located at 000 - 00xx Xxxxxx, Xxxxxxx, Xxxxxxxxxx,
00000.
1.4 Commencement Date: The date determined in accordance with
Section 3.2 below.
1.5 Common Areas: The Building common corridors and hallways,
restrooms, stairways, patios, elevators and other generally
understood public or common areas. Landlord shall have the
right to regulate or restrict the use of the Common Areas.
1.6 Expiration Date: Five years from commencement date, unless
sooner terminated in accordance with the provisions of this
Lease.
1.7 First Adjustment Date: Intentionally Deleted
1.8 Guarantor: Letter of credit in the amount of $100,000.00 to
be obtained in favor of Central Building LLC shall be
submitted to and approved by Landlord prior to occupancy of
the fourth floor premises, and an additional $100,000.00
letter of credit to be obtained in favor of Central Building
LLC shall be submitted to and approved by Landlord prior to
occupancy of the third floor premises.
1.9 Index: Intentionally deleted.
2
1.10 Interest Rate: A per annum rate of interest equal to two
percent (2%) plus the rate most recently announced by Xxxxx
Fargo Bank, N.A., at its main office in San Francisco,
California, as its "Prime Rate", serving as the basis upon
which effective rates of interest are calculated for those
loans making reference thereto, but in no event in excess of
the maximum applicable usury limitation.
1.11 Landlord's Notice Address: c/o Colliers International, 0
Xxxxxxxxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxxxxxxx, Xxxxxxxxxx
00000, Attn: Portfolio Manager, or such other address as
Landlord shall designate from time to time.
1.12 Premises: That portion of the Building containing
approximately 18,000 square feet of Rentable Area, shown by
diagonal lines on Exhibit "A", located on the third and fourth
floors of the Building and known as Xxxxx 000 xxx Xxxxx 000.
Tenant, at Tenant's sole cost and expense, shall have the
right to have Tenant's architect re-measure the entire
Building. In the event there is more than a five percent (5%)
variance in the square footage of Tenant's Premises, then
Landlord and Tenant shall mutually agree upon a revised
Rentable Area. If the agreed upon rentable area of the
Premises vary by more than 5%, then Landlord shall be
responsible for the cost of the re-measuring.
1.13 Real Estate Broker: Colliers International
1.14 Rentable Area: As to both the Premises and the Building, the
respective measurements of floor area as may from time to time
be subject to lease by Tenant and all tenants of the Building,
respectively, as determined by Landlord and applied on a
consistent basis throughout the Building.
1.15 Scheduled Commencement Date: April 30, 1999.
1.16 Security Deposit: Thirty-six Thousand Dollars and No Cents
($36,000.00). Equal to last month's rent, subject to
adjustment based on re-measuring of the premises.
1.17 Tenant's Notice Address: Cybergold, Inc., 000 - 00xx Xxxxxx,
Xxxxx 000, Xxxxxxx, Xxxxxxxxxx 00000.
1.18 Tenant's Proportionate Share: 5.63% per floor, for a total of
11.26%. Such share is a fraction, the numerator of which is
the Rentable Area of the Premises, and the denominator of
which is the Rentable Area of the Building, as determined by
Landlord from time to time. The Building contains a total
Rentable Area of approximately 159,795 square feet.
2
3
1.19 Tenant's Use: General office, Internet site development.
1.20 Term: The period commencing on the Commencement Date and
expiring at midnight on the Expiration Date.
2. LEASE OF PREMISES.
Landlord hereby leases to Tenant, and Tenant hereby leases from
Landlord, the Premises for the Term and subject to the terms and
provisions contained in this Lease. The Premises are located within
the Building. Tenant shall have the nonexclusive right (unless
otherwise provided herein) to the use of the Common Areas in common
with Landlord, other tenants and occupants of the Building and other
parties entitled to use the Common Areas, subject to the provisions
of this Lease and to the Building rules and regulations. Tenant
shall have access to the Premises twenty-four hours a day, seven
days per week.
3. TERM.
3.1 Delivery of Possession. This Lease shall become effective upon
execution by Landlord and Tenant. The term of this Lease
("Term") shall commence on the Commencement Date of the Fourth
Floor Premises and shall continue until the Expiration Date,
unless earlier terminated in accordance with this Lease or
unless extended as hereinafter provided. If for any reason
Landlord cannot deliver possession of the Premises to Tenant
on the Scheduled Commencement Date, Landlord shall not be
subject to any liability for such failure, the Expiration Date
shall not change and the validity of this Lease shall not be
impaired, but Base Rent shall be abated until delivery of
possession. Tenant shall have the right to terminate this
Lease if Landlord fails to Substantially Complete the Tenant
Improvements, as agreed upon, within one hundred twenty days
(120) following the execution date of this Lease, excluding
delays caused by Tenant, Acts of God, or Governmental
Agencies. Substantial completion of the Tenant Improvements
shall not include the completion of the installation of the
mechanical system
3.2 Commencement Date. The Commencement Date shall be the earlier
of (a) the date upon which Tenant occupies the Fourth Floor
Premises, or (b) the date on which Landlord delivers
possession of the Fourth Floor Premises to Tenant with the
Tenant Improvements provided for in Exhibit "C" attached
hereto, if any, Substantially Completed (as defined in Exhibit
"C"). At such time as the Commencement Date has been
established, Landlord and Tenant shall execute a written
acknowledgment of the Commencement Date.
3
4
4. RENT.
4.1. Payment of Base Rent. Tenant shall pay to Landlord throughout
the Term the Base Rent for the Premises. The Base Rent shall
be payable in advance beginning on the Commencement Date and
on the first business day of each calendar month of the Term
thereafter. If the Term begins (or ends) on other than the
first (or last) day of a calendar month, the Base Rent for the
partial month shall be prorated on a per diem basis on the
basis of a thirty (30) day month. Tenant shall pay Landlord
the first month's Base Rent when Tenant executes the Lease.
4.2 Adjusted Base Rent. - Intentionally Deleted
4.3 Definition of Rent. All costs and expenses which Tenant
assumes or agrees to pay to Landlord under this Lease shall be
deemed additional rent (which, together with the Base Rent,
are sometimes referred to herein as the "Rent"). The Rent
shall be paid to Landlord, the Building manager or such other
person, and at such place, as Landlord may from time to time
designate in writing, without any prior notice or demand
therefor and without deduction, offset or counterclaim, in
lawful money of the United States of America.
4.4 Rent Control. If the amount of Rent or any other payment due
under this Lease violates the terms of any governmental
restrictions on such Rent or payment, then the Rent or payment
due during the period of such restrictions shall be the
maximum amount allowable under those restrictions. Upon
termination of the restrictions, Landlord shall, to the extent
it is legally permitted, recover from Tenant the difference
between the amounts received during the period of the
restrictions and the amounts Landlord would have received had
there been no restrictions.
5. BUILDING OPERATING COSTS.
5.1 Tenant's Obligation. During each calendar year during the
Term, Tenant shall pay to Landlord, as additional rent and in
addition to the Base Rent and all other payments due under
this Lease, an amount equal to Tenant's Proportionate Share of
increases in Building Operating Costs in the manner provided
below.
5.2 Definition. The term "Building Operating Costs" means all
costs and expenses paid or incurred by Landlord in the
ownership, management, operation, repair, replacement and
maintenance of the Building, including, without limitation,
the following:
4
5
(a) Costs of electricity, water, gas, steam and other
utilities and services furnished to or consumed within
the Building, and all utility taxes thereon;
(b) Costs of all supplies and materials used by Landlord in
connection with the Building;
(c) Premiums and other charges for insurance, including,
without limitation, all risk, commercial general
liability, property damage, worker's compensation,
employer's liability, earthquake (if required by
Landlord's lender, mortgagee or any Governmental
Agency), flood and such other insurance in such forms of
coverage and in such amounts as Landlord, in its sole
discretion, shall elect to maintain with respect to the
Building or shall be obligated to maintain with respect
to the Building by any mortgagee or lender;
(d) Costs of, and all amounts payable under, service,
maintenance and inspection contracts for janitorial,
window-cleaning, garbage removal, extermination,
elevator, escalator, plumbing, electrical and mechanical
equipment, heating, ventilating and air-conditioning
("HVAC") equipment, security protection, landscape
maintenance and costs of purchasing or renting
equipment, supplies, tools, materials and uniforms;
(e) Compensation (including employment taxes and fringe
benefits) of all persons who perform duties connected
with the operation, maintenance or repair of the
Building, and equipment, improvements and facilities
located within the Building, including, without
limitation, engineers, janitors, painters, floor waxers,
window washers and security personnel (but excluding
persons performing services not uniformly available to
or performed for substantially all Building tenants);
(f) Costs of the operation and maintenance of a room, if
any, for delivery and distribution of mail to tenants of
the Building (including, without limitation, an amount
equal to the fair market rental value of the mail room
premises);
(g) Fees and costs of management of the Building, whether
managed by Landlord, an affiliate of Landlord or an
independent contractor (including, without limitation,
an amount equal to the fair market value of any on-site
manager's office);
(h) Rental expenses for (or a depreciation allowance on)
personal property used in the maintenance, operation or
repair of the Building;
5
6
(i) License, permit and inspection fees; costs of complying
with applicable statutes, ordinances, rules and
regulations of governmental authorities, including,
without limitation, repairs, maintenance,, alterations,
additions or improvements required in connection
therewith; attorneys', accountants' and consultants'
fees;
(j) The costs of any capital improvements made to the
Building by Landlord in order to reduce Building
Operating Costs; made to the Building by Landlord after
the date of this Lease that are required under any
governmental law or regulation that was not applicable
to the Building at the time it was constructed;
(k) Other costs and expenses which are of a type generally
reimbursed by Tenants of comparable office buildings in
Oakland, California.
(1) Capital improvement costs, other than those specified
herein, are specifically excluded. Tenant shall not be
liable to Landlord for the reimbursement of any
attorneys' fees and other costs and expenses incurred in
connection the negotiation or disputes with present or
other prospective tenants or other occupants of the
Building, except those attorneys' fees and other costs
and expenses incurred in connection with negotiation
disputes or claims relating to items of Building
Operating Costs, enforcement of rules and regulations of
the Building and such other matters relating to the
maintenance of standards required of Landlord under this
Lease.
Building Operating Costs shall not include Real Property Taxes
which shall be governed by Section 6 below.
5.3 Payment. Tenant's Proportionate Share of Increases in Building
Operating Costs shall be payable by Tenant to Landlord as
follows:
(a) Beginning with the calendar year following the Base Year
and for each calendar year thereafter (each, a
"Comparison Year"), Tenant shall pay to Landlord an
amount equal to Tenant's Proportionate Share of the
amount by which the Building Operating Costs paid or
incurred by Landlord in the Comparison Year exceeds the
Building Operating Costs paid or incurred by Landlord
for the Base Year. This excess is referred to as the
"Excess Operating Costs." The Building Operating Costs
for each Comparison Year in which less than ninety-five
percent (95%) of the Rentable Area of the Building has
been occupied for the entire Computation Year shall be
determined by adjusting the actual Building Operating
Costs to equal Landlord's reasonable estimate of what
the Building Operating Costs would have been if
6
7
ninety-five percent (95%) of the Rentable Area of the
Building had been fully occupied for such entire
Comparison Year.
(b) To provide for current payments of Excess Operating
Costs, Tenant shall, at Landlord's request, pay as
additional rent during each Comparison Year an amount
equal to Tenant's Proportionate Share of the Excess
Operating Costs payable during such Comparison Year, as
estimated by Landlord from time to time. Landlord shall
have the right to notify Tenant of the amount which
Landlord reasonably estimates to be the monthly
installments of Tenant's Proportionate Share of Excess
Operating Costs for any Comparison Year. Tenant shall
make such monthly installments commencing on the first
business day of the month following the month in which
Landlord gives Tenant a notice of estimated Tenant's
Proportionate Share of Excess Operating Costs and
continuing until the first day of the month following
the month in which Landlord gives Tenant a new notice of
estimated Tenant's Proportionate Share of Excess
Operating Costs.
(c) On or before April 1 of each Comparison Year after the
first Comparison Year (or as soon thereafter as is
practicable), Landlord shall deliver to Tenant a
statement setting forth the actual amount of Tenant's
Proportionate Share of Excess Operating Costs for the
preceding Comparison Year. If the actual amount of
Tenant's Proportionate Share of Excess Operating Costs
for the preceding Comparison Year exceeds the total of
the estimated monthly payments made by Tenant for such
year, Tenant shall pay Landlord the amount of the
deficiency within ten (10) days of the receipt of the
statement. If the total of the estimated monthly
payments made by Tenant for such year exceeds the actual
amount of Tenant's Proportionate Share of Excess
Operating Expenses for such Comparison Year, then
Landlord shall credit against Tenant's next ensuing
monthly installments of Tenant's Proportionate Share of
Excess Operating Costs an amount equal to the difference
until the credit is exhausted. If a credit is due from
Landlord on the Expiration Date, Landlord shall pay
Tenant the amount of the credit. The obligations of
Tenant and Landlord to make payments required under this
Section 5 shall survive the Expiration Date.
(d) Tenant's Proportionate Share of Excess Operating Costs
in any Comparison Year having less than 365 days shall
be appropriately prorated.
7
8
(e) Upon reasonable notice from Tenant, Landlord shall make
available for Tenant's inspection, at Landlord's office,
during normal business hours, Landlord's books and
records relating to the Building Operating Costs for the
previous year. Tenant may submit a claim for any over
billed amount to Landlord detailing the nature of the
over billing and Landlord shall have thirty (30) days to
respond or pay such amount. If on the basis of Tenant's
review of Landlord's books and records, Landlord's
statement is determined to be in error by more than six
percent (6%) Landlord shall reimburse Tenant, within
thirty (30) days following such determination, the
reasonable cost of Tenant's review of Landlord's books
and records.
(f) In no event shall Tenant's proportionate share of Excess
Operating Costs exceed Fifty Cents ($.50) per square
foot per month.
6. REAL PROPERTY TAXES.
6.1 Tenant's Obligation. During each calendar year during the
Term, Tenant shall pay to Landlord, as additional rent and in
addition to the Base Rent and all other payments due under
this Lease, an amount equal to Tenant's Proportionate Share of
increases in Real Property Taxes in the manner provided below.
6.2 Definition. The term "Real Property Taxes" means all taxes,
assessments, water and sewer charges and other similar
governmental charges (including costs and expenses of
contesting the amount or validity thereof by appropriate
administrative or legal proceedings) levied on or attributable
to the Building or its operation, including, without
limitation, all real property taxes and general and special
assessments; charges, fees, levies and assessments for
transit, housing, police, fire or other governmental services
or purported benefits to the Building; service payments in
lieu of taxes; environmental surcharges; excise taxes; gross
receipts taxes; gross income taxes; rent taxes; sales and/or
use taxes; employee taxes; water and sewer taxes and charges;
any tax, fee or excise on the act of entering into this Lease,
on the use or occupancy of the Building or any part thereof,
or upon or measured by the rent payable under any lease or in
connection with the business of renting space in the Building;
and all other governmental impositions of any kind or nature
whatsoever, regardless of whether or not customary or within
the contemplation of the parties hereto and regardless of
whether resulting from increased rate and/or valuation, or
whether extraordinary or ordinary, general or special,
foreseen or unforeseen, or similar or dissimilar to any of the
foregoing, which may now or hereafter be levied or assessed
against Landlord by the United States of America, the State of
California, the City of Oakland or any political subdivision,
public corporation, district or other political or public
entity, and any other tax,
8
9
fee or other excise, however described, levied or assessed as
a substitute for, or as an addition to (in whole or in part),
any other such taxes. Notwithstanding the foregoing, "Real
Property Taxes" shall not include any net income, franchise,
capital stock, estate or inheritance taxes.
6.3 Payment. Tenant's Proportionate Share of increases in Real Property
Taxes shall be payable by Tenant to Landlord as follows:
(a) Beginning with the year following the Base Year and for each
calendar year thereafter (each, a "Comparison Year"), Tenant
shall pay to Landlord an amount equal to Tenant's
Proportionate Share of the amount by which the Real Property
Taxes paid or incurred by Landlord in the Comparison Year
exceeds the Real Property Taxes paid or incurred by Landlord
for the Base Year. This excess is referred to as the "Excess
Taxes."
(b) To provide for current payments of Excess Taxes, Tenant shall,
at Landlord's request, pay as additional rent during each
Comparison Year an amount equal to Tenant's Proportionate
Share of the Excess Taxes payable during such Comparison Year,
as estimated by Landlord from time to time. Landlord shall
have the right to notify Tenant of the amount which Landlord
reasonably estimates to be the monthly installments of
Tenant's Proportionate Share of Excess Taxes for any
Comparison Year. Tenant shall make such monthly installments
commencing on the first day of the month following the month
in which Landlord gives Tenant a notice of estimated Tenant's
Proportionate Share of Excess Taxes and continuing until the
first day of the month following the month in which Landlord
gives Tenant a new notice of estimated Tenant's Proportionate
Share of Excess Taxes.
(c) On or before April 1 of each Comparison Year (or as soon
thereafter as is practicable), Landlord shall deliver to
Tenant a statement setting forth the actual amount of Tenant's
Proportionate Share of Excess Taxes for the preceding
Comparison Year. If the actual amount of Tenant's
Proportionate Share of Excess Taxes for the preceding
Comparison Year exceeds the total of the estimated monthly
payments made by Tenant for such year, Tenant shall pay
Landlord the amount of the deficiency with ten (10) days of
the receipt of the statement. If the total of the estimated
monthly payments made by Tenant for such year exceeds the
actual amount of Tenant's Proportionate Share of Excess Taxes
for such Comparison Year, then Landlord shall credit against
Tenant's next ensuing monthly installments of Tenant's
Proportionate Share of Excess Taxes an amount equal to the
difference until the credit is exhausted. If a credit is due
from Landlord on the Expiration
9
10
Date, Landlord shall pay Tenant the amount of the credit. The
obligations of Tenant and Landlord to make payments required
under this Section 6 shall survive the Expiration Date.
(d) Tenant's Proportionate Share of Excess Taxes in any Comparison
year having less than 365 days shall be appropriately
prorated.
(e) In no event shall Tenant's Proportionate Share of Excess Taxes
exceed Fifty Cents ($.50) per square foot per month.
6.4 Taxes Payable by Tenant. In addition to the Rent and any other
amounts to be paid by Tenant hereunder, Tenant shall reimburse
Landlord upon demand for any and all taxes, levies, assessments,
surcharges, fees and other charges payable by Landlord which are not
otherwise reimbursable under this Lease, whether or not now
customary or within the contemplation of the parties, where such
taxes, levies, assessments, surcharges, fees and other charges are
upon, measured by or reasonably attributable to (a) the cost or
value of Tenant's equipment, furniture, fixtures and other personal
property located in the Premises, or the cost or value of any
leasehold improvements made in or to the Premises by or for Tenant,
regardless of whether title to such improvements is held by Tenant
or Landlord; (b) the gross or net Rent payable under this Lease,
including, without limitation, any rental or gross receipts tax
levied by any taxing authority with respect to the receipt of the
Rent hereunder such as the Oakland Business Tax or any similar tax;
(c) the possession, leasing, operation, management, maintenance,
alteration, repair, use or occupancy by Tenant of the Premises or
any portion thereof; or (d) this transaction or any document to
which Tenant is a party creating or transferring an interest or an
estate in the Premises. If it shall be unlawful for Tenant to
reimburse Landlord for any additional taxes as required under this
Lease, the Base Rent shall be revised to net Landlord the same net
Rent after imposition of any tax or other charge upon Landlord as
would have been payable to Landlord but for the reimbursement being
unlawful. Tenant anticipates a potential tax rebate from the City of
Oakland. Any tax rebate related solely to Tenant's action in this
capacity to the benefit of the Landlord will be reimbursed to the
Tenant.
7. LATE CHARGES AND INTEREST.
Tenant acknowledges that the late payment of any monthly installment of
Base Rent or other amount which Tenant is obligated to pay under this
Lease will cause Landlord to lose the use of that money and incur costs
and expenses not contemplated under this Lease, including, without
limitation, administrative and collection costs and processing and
accounting expenses, the exact amount of which are extremely difficult to
ascertain. Therefore, if any such installment or other amount is not
received by Landlord when due, Tenant shall pay to Landlord a late charge
equal to five percent (5%) of such installment or other
10
11
amount. Landlord and Tenant agree that this late charge represents a
reasonable estimate of such costs and expenses and is fair compensation to
Landlord for the loss suffered from such late payment by Tenant. In
addition, if Tenant fails to pay when due any Rent or other amount which
Tenant is obligated to pay under the terms of this Lease and such failure
shall continue for ten (10) days, the unpaid amount shall bear interest
at the Interest Rate from the date on which such payment was due until the
date on which Landlord receives such payment. Acceptance of any late
charge and/or interest shall not constitute a waiver of Tenant's default
with respect to such late payment by Tenant or prevent Landlord from
exercising any other rights or remedies available to Landlord under this
Lease.
8. SECURITY DEPOSIT.
Upon execution of this Lease, Tenant shall deposit with Landlord as the
Security Deposit the amount set forth in Article 1 above as security for
Tenant's faithful performance of its obligations under this Lease.
Landlord may commingle the Security Deposit with funds of Landlord, and
Landlord shall have no obligation or liability to pay interest on the
Security Deposit. Tenant shall not pledge, assign, transfer or encumber
the Security Deposit and any attempt by Tenant to do so shall be void,
without force or effect, and shall not be binding upon Landlord.
If Tenant fails to pay any Rent or other amount when due and payable under
this Lease, or fails to perform any of the other terms hereof, Landlord
may apply or use all or any portion of the Security Deposit for Rent
payments or any other amount then due and unpaid, for payment of any
amount for which Landlord has become obligated as a result of Tenant's
default or breach, and for any loss or damage sustained by Landlord as a
result of Tenant's default or breach, and Landlord may so apply or use the
Security Deposit without prejudice to any other remedy Landlord may have
by reason of Tenant's default or breach. If Landlord so applies or uses
any of the Security Deposit, Tenant shall, within ten (10) days after
written demand therefor, restore the Security Deposit to the full amount
originally deposited. Tenant's failure to do so shall constitute a default
hereunder, and Landlord shall have the right to exercise any remedy
provided for in this Lease. If Tenant shall not be in default under this
Lease, Landlord shall return the Security Deposit, or any balance thereof
not applied or used in accordance with the provisions of this Lease, to
Tenant within thirty (30) days following the later of the expiration of
the Term or the date on which Tenant surrenders the Premises to Landlord
in the condition required under this Lease. If Landlord transfers its
interest in the Premises, Landlord may deliver the Security Deposit to the
transferee of Landlord's interest and thereupon be relieved of any further
liability or obligation with respect to the Security Deposit.
11
12
9. TENANT'S USE OF THE PREMISES.
9.1 Use. Tenant shall use the Premises solely for the purposes set forth
as Tenant's Use in Article 1 above. Tenant, at its sole cost and
expense, shall obtain any and all licenses, permits, authorizations
and approvals of governmental authorities required in order to
enable Tenant lawfully to conduct its business in the Premises.
Nothing contained in this Lease shall grant to Tenant the exclusive
right to conduct within the Building or the Premises the business to
be conducted by Tenant in the Premises, or otherwise limit the right
of Landlord to lease space within the Building to such tenants and
for such purposes as Landlord, in its sole discretion, shall deem
appropriate. Tenant shall conduct Tenant's business on the Premises
in a lawful manner, reasonably and in good faith, and shall not do
any act tending to injure the reputation of the Building as
determined by Landlord. Tenant shall not do or permit to be done
anything which will invalidate or increase the cost of any fire,
extended coverage or other insurance policy covering the Building
and/or the property located therein, and shall comply with all
rules, orders, regulations, requirements and recommendations of the
Insurance Service Office or any other organization performing a
similar function. Tenant shall promptly upon demand reimburse
Landlord for any additional premiums charged for any such insurance
policy by reason of Tenant's failure to comply with the provisions
of this Article.
9.2 Nuisance or Waste. Tenant shall not do or permit to be done in or
about the Premises anything which will in any way obstruct or
interfere with the rights of other tenants or occupants of the
Building or injure or annoy them or use or allow the Premises to be
used for any improper, immoral or objectionable purpose, and Tenant
shall not cause, maintain or permit any nuisance in, on or about the
Premises. Tenant shall not commit or suffer the commission of any
waste in, on or about the Premises. Tenant shall not use or operate
any equipment, machinery or apparatus within the Premises which will
(a) injure, vibrate or shake the Premises or the Building, (b)
overload existing electrical systems or other utilities or equipment
servicing the Premises or the Building, or (c) impair the efficient
operation of the sprinkler system (if any) or the HVAC equipment (if
any) within or servicing the Premises or the Building. All noises or
odors generated by Tenant's use of the Premises shall be muffled or
contained in such manner that they do not interfere with the use or
occupancy of other tenants or occupants of the Building.
9.3 Compliance with Law. Tenant shall not use or occupy the Premises or
permit anything to be done in, on or about the Premises which will
in any way conflict with (a) any statute, ordinance, rule or
regulation of governmental authorities now in force or which may
hereafter be enacted or promulgated, (b) any covenant, condition or
restriction affecting the Building or (c) the certificate of
occupancy issued for the
12
13
Premises or any other portion of the Building, and shall, upon
notice from Landlord, immediately discontinue any use of the
Premises which is declared by any governmental authority having
jurisdiction to be a violation of law or the certificate of
occupancy. Tenant, at Tenant's own cost and expense, shall comply
with all statutes, ordinances, regulations, rules and/or any
directions of any governmental authorities having jurisdiction,
including, without limitation, the Americans with Disabilities Act,
Title 24 or any other handicap accessibility laws, which shall, by
reason of the nature of Tenant's use or occupancy of the Premises,
or by reason of any alteration, addition or improvement made by
Tenant in the Premises, impose any duty upon Tenant or Landlord with
respect to the Premises or its use or occupancy, or with respect to
any other portion of the Building. A judgment of any court of
competent jurisdiction or the admission by Tenant in any action or
proceeding against Tenant that Tenant has violated any such laws,
ordinances, regulations, rules and/or directions in the use of the
Premises shall be deemed to be a conclusive determination of that
fact as between Landlord and Tenant. Landlord and Tenant agree that
Landlord, with regard to Tenant's Premises, will be in full
compliance with all hazardous material statutes, ordinances, rules
and regulations or governmental authorities, in effect prior to the
commencement date of the Lease.
9.4 Hazardous Materials. Without limiting the generality of the
provisions of this Article 9, Tenant, at its sole cost and expense,
shall comply with all statutes, ordinances, rules and regulations of
governmental authorities relating to the storage, use,
transportation, release and/or disposal of radioactive materials,
hazardous waste, toxic or contaminated substances or similar
materials, including, without limitation, any substances which are
"hazardous substances" , "hazardous waste", "hazardous materials" or
"toxic substances" under applicable federal, state and local
environmental statutes, ordinances, rules or regulations
(collectively, "Hazardous Materials"). Tenant shall not store, use,
transport, release or dispose of any Hazardous Materials in, on,
from or about the Premises without the prior written consent of
Landlord. Tenant shall be solely responsible for and shall
indemnify, defend and hold Landlord and its officers, directors,
shareholders, partners, members, agents, employees, contractors,
invitees, representatives, successors and assigns harmless from and
against any and all losses, costs, claims, damages, liabilities and
causes of action, including attorneys' fees, arising out of or in
connection with the storage, use, transportation, release or
disposal of Hazardous Materials by Tenant, its employees, agents,
contractors or invitees, including any claims for the clean-up or
remediation of any Hazardous Materials. Tenant shall give to
Landlord written notice of any communication received by Tenant from
any governmental authority or other party alleging the existing of
Hazardous Materials in, on, under or about the Premises or the
Building, or any alleged violation of environmental laws with
respect to the Premises or the Building.
13
14
Without limiting any other provision of this Lease, Tenant shall
provide Landlord with access to the Premises during all reasonable
times in order to enable Landlord to conduct any inspection,
monitoring, remediation, removal or repair relating to the presence
or alleged presence of Hazardous Materials in, on under or about the
Premises or the Building.
9.5 Common Area Provisions. Landlord shall have the right, from time to
time, temporarily to close portions of the Common Areas in order to
prevent a dedication thereof to the public or the perfection of any
prescriptive rights therein or to perform repair or maintenance on
such portion of the Common Areas; and to change the size, shape,
location and extent of the areas, facilities and improvements
included in the Common Areas, including changes In the location of
driveways, entrances, exits, elevators, stairs, corridors, common
restrooms and other portions of the Common Areas. Landlord's
exercise of such rights shall not subject Landlord to any liability
therefor nor shall Tenant be entitled to any compensation or any
diminution or abatement of rent, provided that Landlord exercises
such rights in such manner as to minimize any interference with
Tenant's use and enjoyment of the Premises to the extent reasonably
possible. In no event shall Landlord's exercise of such rights be
deemed to be a constructive or actual eviction of Tenant, or a
breach of Landlord's covenant of quiet enjoyment.
10. SERVICES AND UTILITIES.
10.1 General. Provided that Tenant is not in default hereunder, Landlord
shall
(a) Operate or cause the operation of the HVAC system serving the
Premises on generally recognized business days and during
hours determined by Landlord in its sole discretion, subject
to the Building rules and regulations, as required in
Landlord's judgment for the comfortable use and occupancy of
the Premises, or as may be permitted or controlled by
applicable statutes, ordinances, rules and regulations of
governmental authorities. If Tenant desires HVAC service at
any other time, Landlord shall use reasonable efforts to
furnish such service upon reasonable written notice from
Tenant, and Tenant shall pay on demand the charges established
by Landlord therefor from time to time (including any
administrative fee imposed by Landlord). Tenant agrees to
cooperate fully with Landlord at all times and to abide by all
regulations and requirements which Landlord may prescribe for
the proper functioning and protection of the HVAC, system, and
Landlord shall not be responsible for the failure of the HVAC
system to perform its function due to Tenant's failure to
abide by such regulations and requirements. If Tenant uses
heat generating machines or equipment in the Premises which
affect the temperature otherwise maintained by the HVAC
system,
14
15
Landlord shall have the right to install supplementary
airconditioning units in the Premises, and the cost thereof,
including the cost of installation, operation and maintenance
thereof, shall be paid by Tenant to Landlord upon demand by
Landlord;
(b) Make customary arrangements with public utilities and/or
governmental authorities to furnish electric current to the
Premises in amount sufficient for normal lighting by overhead
fluorescent fixtures and for normal desktop office equipment
and copying equipment. Tenant shall not, without the prior
written consent of Landlord, use any apparatus or device in
the Premises, including, without limitation, electronic data
processing equipment, special communications equipment,
special lighting or any other electrical equipment, which
(singly) consumes more than one (1.0) kilowatt per hour at
rated capacity or requires a voltage other than 120 volts
single-phase, or which consumes more electricity than is
usually furnished or supplied for the use of premises as
general office space, as determined by Landlord. Landlord
shall not restrict Tenant's reasonable electrical usage.
Tenant shall not connect any apparatus or device with electric
current except through existing electrical outlets in the
Premises. Landlord shall have no obligation to install
dedicated circuits or other special circuitry or wiring.
Tenant shall advise Landlord prior to execution of this Lease
and thereafter within five (5) days after written request
therefor from Landlord of the nature and quantity of all
lights, equipment and machines using electricity in the
Premises. If Landlord determines that Tenant is using
excessive electricity, Landlord shall have the right to
install an electric current meter in or with respect to the
Premises in order to measure the amount of electricity
consumed on the Premises. The cost of any such meter, any
conduits, wiring, panels and other equipment required in
connection with such meter, and the installation, maintenance
and repair thereof, shall be paid by Tenant to Landlord
promptly upon demand, together with the cost of any excessive
electricity consumed by Tenant. If Landlord shall not install
a separate meter, the excessive electricity shall be
determined by Landlord or, at Landlord's option, established
by an estimate by a utility company or an electrical engineer
retained by Landlord at Tenant's expense;
(c) Provide access to water in the restrooms on each floor for
drinking and lavatory purposes only; if Tenant requires, uses
or consumes water for any purposes in addition to ordinary
drinking and lavatory purposes, or in excess of the amount
thereof usually furnished or supplied for the use of premises
as general office space, as determined by Landlord, Landlord
shall have the right to install a separate water meter in or
with respect to the
15
16
Premises in order to measure the amount of water consumed by
Tenant. The cost of any such meter, and the installation,
maintenance, and repair thereof, shall be paid by Tenant to
Landlord promptly upon demand, together with the cost of any
excessive water consumed by Tenant. If Landlord shall not
install a separate meter, the excessive water shall be
determined by Landlord or, at Landlord's option, established
by an estimate by a utility company or a consultant retained
by Landlord at Tenant's expense;
(d) Maintain and keep lighted the common stairs, common entries
and restrooms in the Common Areas of the Building;
(e) Furnish elevator service, fighting replacement for building
standard lights, restroom supplies, window washing and
janitorial service to the extent and in such manner as such
services are customarily furnished to comparable office
buildings in Oakland, California.
(f) Landlord shall provide a lobby attendant, 24 hours a day, 7
days a week, throughout the term of the Lease.
10.2 Supplementary Services. Tenant shall pay to Landlord upon demand, at
the charges established by Landlord from time to time, the cost of
all supplementary services provided by Landlord to Tenant at
Tenant's request, which services are in addition to those which
Landlord is obligated to provide under this Lease, together with an
administrative fee payable to Landlord in the amount established by
Landlord from time to time. Such supplementary services shall
include, without limitation, maintenance, repair, janitorial,
cleaning and other services provided during hours other than
ordinary business hours and/or in amounts reasonably considered by
Landlord to be in excess of the normal and customary usage thereof
for the use of the Premises authorized by this Lease.
10.3 Interruption of Services. Except for Landlord's gross negligence or
willful misconduct, Landlord shall not be in default under this
Lease or liable for any damages directly or indirectly resulting
from (a) the installation, use or interruption of use of any
equipment in connection with the furnishing of any of the foregoing
services; or (b) the failure to furnish or delay in furnishing any
such services, where such failure is caused by any act of God or the
elements; a shortage or unavailability of necessary materials,
supplies or labor; a shortage or interruption in transportation
facilities; riots; civil disturbances; insurrection; war; court
order; public enemy; accidents; breakage; strikes, lockouts or other
labor disputes; the making of repairs, replacements, alterations,
additions or improvements to the Premises or the Building; the
inability to obtain an adequate supply of fuel, gas, steam, water,
electricity or other utilities or services; or any
16
17
other condition beyond Landlord's reasonable control, and Tenant
shall not be entitled to any damages resulting from such failure or
to any diminution or abatement in any Rent or other amounts payable
by Tenant hereunder. In no event shall such failure be construed as
a constructive or other eviction of Tenant. If any governmental
authority promulgates or revises any statute, ordinance or building,
fire or other code, or imposes mandatory controls or guidelines on
Landlord or the Building or any part thereof related to the use or
conservation of energy, water, gas, steam, light or electricity or
the provision of any other utility or service provided under this
Lease, Landlord may, in its sole discretion, comply with such
mandatory controls or guidelines. If at any time, the owners of a
significant number of buildings in Oakland, California comparable to
the Building have elected to comply voluntarily with any request or
guideline of any applicable governmental authority, Landlord may
also comply with such request or guideline. Such compliance shall in
no event entitle Tenant to any damages, or any diminution or
abatement in any Rent or other amounts payable by Tenant under this
Lease, or constitute or be construed as a constructive or other
eviction of Tenant. Tenant shall comply with all rules, regulations
and requirements of applicable governmental authorities or utility
companies concerning the use of utility services, including any
rationing, limitation or other control on the quantity of utilities
used or consumed.
10.4 Payment. - Intentionally Deleted
11. CONDITION OF THE PREMISES.
Tenant acknowledges that Tenant is fully informed independently of
Landlord as to the character, construction and structure of the Building
and the Premises. Tenant's taking possession of the Premises (whether
before or after the Scheduled Commencement Date) shall constitute Tenant's
acceptance of the Premises and acknowledgment that any Tenant improvements
were constructed in accordance with the provisions of this Lease and that
the Premises are in good order and satisfactory condition. Tenant shall
accept the Premises subject to all applicable statutes, ordinances, rules
and regulations of governmental authorities governing and regulating the
use or occupancy of the Premises, including, without limitation, all
applicable zoning, planning, environmental and land use statutes,
ordinances, rules and regulations. Tenant acknowledges that neither
Landlord nor Landlord's employees, agents or contractors have made any
representation or warranty as to the suitability of the Premises for the
conduct of Tenant's business or the consistency of Tenant's proposed use
of the Premises with any applicable zoning, planning, environmental or
land use statutes, ordinances, rules or regulations. With the exception of
the elevator upgrades, security system, lower level Bart entrance and new
front entry doors, no promise of Landlord to alter, remodel, repair or
improve the Premises or the Building, and no representation or warranty,
express or implied, with respect to any matter or thing relating to the
Premises, the Building or this Lease
17
18
(including, without limitation, the condition of the Premises or the
Building) has been made to Tenant by Landlord or its agents, employees or
contractors other than as may be contained herein. To the best of
Landlord's knowledge, Landlord has disclosed all known defects to Tenant.
12. REPAIRS AND MAINTENANCE.
12.1 Landlord's Obligation. Landlord shall repair and maintain in good
order, condition and repair the structural portions of the Building,
including but not limited to the foundations, roof and exterior
surfaces of load-bearing walls, but exclusive of doors, door frames,
entrances, windows and window frames.
12.2 Tenant's Obligation.
(a) Except as provided in Section 12.1 above, Tenant, as a result
of Tenant's actions, at Tenant's sole cost and expense, shall
keep the Premises in good order, condition and repair,
including the interior surfaces of the ceilings, walls and
floors; all doors, door frames, entrances, windows, window
frames and plate glass; all electrical, plumbing, sewer and
other utility lines, equipment and systems, including all
portions of the HVAC system, whether installed or furnished by
Landlord or Tenant, located in or serving the Premises; and
all special items and equipment installed by or at the expense
of Tenant.
(b) Tenant shall be responsible for all repairs and alterations in
and to the Premises and Building and the facilities and
systems thereof, the need for which arises out of (i) Tenant's
use or occupancy of the Premises, (ii) the installation,
removal, use or operation of any Alterations (as defined
below) or any of Tenant's equipment, machinery, trade
fixtures, furniture or other personal property in the
Premises, (iii) the moving of Tenant's equipment, machinery,
trade fixtures, furniture or other personal property into or
out of the Building, or (iv) the negligent or willful act or
omission of Tenant, its agents, contractors, employees or
invitees.
(c) If Tenant fails to keep the Premises in good order, condition
and repair, then Landlord shall have the right to do such acts
and expend such funds at the expense of Tenant as are
reasonably required to perform the work or repair and
maintenance. Any amount so expended by Landlord shall be paid
by Tenant promptly after demand with interest at the Interest
Rate from the date of such work. Landlord shall have no
liability to Tenant for any damage, inconvenience or
interference with the use of the Premises by Tenant as a
result of performing any such work.
18
19
12.3 Compliance with Law. Landlord and Tenant shall each do all acts
required to comply with all applicable statutes, ordinances, rules
and regulations of any governmental authority relating to the
performance of their respective repair and maintenance obligations
as set forth herein.
12.4 Waiver by Tenant. Tenant expressly waives the benefits of any
statute now or hereafter in effect which would otherwise afford
Tenant the right to make repairs at Landlord's expense or to
terminate this Lease because of Landlord's failure to keep the
Premises in good order, condition and repair, including, without
limitations Sections 1932, 1941 and 1942 of the California Civil
Code or any other, similar statute, ordinance, rule or regulation
now or hereafter in effect. Notwithstanding the above, Tenant shall
have the right to make repairs at Landlord's expense provided
Landlord has not responded within five (5) days to Tenant's written
notification, and Tenant cannot use the Premises for Tenant's
business.
12.5 Load and Equipment Limits. Tenant shall not place a load upon any
floor of the Premises which exceeds the load per square foot which
such floor was designed to carry, as determined by Landlord or
Landlord's structural engineer. The cost of any such determination
made by Landlord's structural engineer shall be paid for by Tenant
upon demand. Tenant shall not install machines or equipment which
cause noise or vibration to such a degree as to be objectionable to
Landlord or other Building tenant or occupant.
12.6 Landlord Not Liable. Except as otherwise expressly provided in this
Lease, Landlord shall have no liability to Tenant, except to the
extent covered by Landlord's insurance, and Tenant's obligations
under this Lease shall not be reduced or abated in any manner
whatsoever, by reason of any inconvenience, annoyance, interruption
or injury to business arising from Landlord's making any repairs or
changes which Landlord is required or permitted by this Lease or by
any other tenant's lease or required by law to make in or to any
portion of Building or the Premises. Landlord shall nevertheless use
reasonable efforts to minimize any interference with Tenant's
business in the Premises to the extent reasonably possible. In no
event shall Landlord be liable to Tenant for any consequential
damages regardless of the cause of such damages, with the exception
of gross negligence or willful misconduct on the part of Landlord.
12.7 Notice of Condition. Tenant shall give Landlord prompt notice of any
damage to or defective condition in the Building's mechanical,
electric, plumbing, HVAC or other systems serving or located in the
Premises.
19
20
13. ALTERATIONS
13.1 General. Tenant shall not make any additions, alterations or
improvements to the Premises (collectively, "Alterations"),
including, without limitation, those required by Tenant in order to
prepare the Premises for Tenant's occupancy or to enable Tenant to
conduct its business therein, without obtaining the prior written
consent of Landlord. In no event shall Tenant make any Alterations
to the Premises which affect the structural integrity of the
Building or the functioning of any Building systems,, or which
reduce the value of the Premises or the Building. In the event that
Tenant shall desire to make any Alterations, Tenant shall submit to
Landlord such information as Landlord may require prior to the
commencement of construction or installation of such Alterations,
including, without limitation, plans and specifications for the
Alterations and the identity and qualifications of Tenant's proposed
contractor. The plans and specifications for the Alterations,
Tenant's proposed contractor and the time for performance of the
Alterations shall be subject to Landlord's prior written approval.
Tenant shall reimburse Landlord for Landlord's costs of considering
Tenant's requests for approval of any such Alterations, including
any cost or expense which Landlord may incur in electing to have
architects and engineers review plans and specifications. Subsequent
to obtaining Landlord's consent and prior to commencement of
construction or installation of the Alterations, Tenant shall
deliver to Landlord copies of the building permit and executed
construction contract covering the Alterations. Landlord's consent
may be conditioned upon Tenant's removing any such Alterations upon
the expiration or earlier termination of this Lease and restoring
the Premises to the same condition as on the Commencement Date. All
work with respect to any Alterations shall be done in a good and
workmanlike manner by the contractor approved by Landlord, shall
comply with all applicable statutes, ordinances, rules and
regulations of governmental authorities having jurisdiction thereof,
and shall be diligently prosecuted to completion. At Landlord's
option, Landlord shall have the right to construct the Alterations
for Tenant's account. If Landlord so elects, Tenant shall reimburse
Landlord for any and all costs thereof (including, without
limitation, the costs of design, labor, materials, equipment, and a
construction fee of fifteen percent (15%) of the total cost of
construction of the Alterations) within ten (10) days after receipt
of Landlord's Invoice.
13.2 Construction Indemnity. Tenant shall pay the costs of any work done
on the Premises pursuant to Section 13.1, and shall keep the
Premises and Building free and clear of liens of any kind. Tenant
shall indemnify, defend, hold Landlord harmless from and against any
and all losses, costs, claims, damages, liabilities and causes of
action (including attorneys' fees) arising out of or in any way
connected with Tenant's performance of any work of construction,
alteration, addition,
20
21
improvement, repair or maintenance in the Premises, or claims for
work or labor performed, or materials or supplies furnished, to or
at the request of Tenant or in connection with the performance of
any work done for the account of Tenant in the Premises or the
Building, whether or not Tenant obtained Landlord's permission to
have such work done, labor performed or materials or supplies
furnished excluding work performed by Landlord on behalf of Tenant.
13.3 Notices. At least twenty (20) days prior to the actual commencement
of any work for which a claim or lien may be flied, Tenant shall
give Landlord written notice of the intended commencement date to
enable Landlord to post and/or record notices of non-responsibility
or any other notices which Landlord deems necessary for the proper
protection of Landlord's interest in the Premises or the Building,
and Landlord shall have the right to enter the Premises and post
such notices at any reasonable time.
13.4 Bonds. Landlord, at Landlord's option, shall have the right to
require that Tenant provide to Landlord, at Tenant's expense,
payment and/or performance bonds In an amount equal to at least one
and one-half (1 1/2) times the total estimated costs of any
Alterations to be made in or to the Premises to protect Landlord
against any liability for mechanic's and materialmen's liens and to
insure timely completion of the work. Nothing contained in this
Section 13.4 shall relieve Tenant of its obligation under Section
13.2 to keep the Premises and the Building free of all liens.
13.5 Removal. Unless their removal is required by Landlord as provided in
Section 13.1, all Alterations shall become the property of
Landlord and shall be surrendered with the Premises upon the
expiration of the Term or earlier termination of this Lease;
provided, however, that Tenant's equipment, machinery and trade
fixtures which can be removed without damage to the Premises shall
remain the property of Tenant and may be removed by Tenant;
provided, however, that if Tenant shall remove any such equipment,
machinery or trade fixtures, Tenant shall promptly repair any damage
to the Premises or to the Building resulting from such removal, and
shall return the Premises and/or the Building to their condition
prior to the installation of any such equipment, machinery or trade
fixtures.
13.6 Common Area Provisions. Tenant shall not use any portion of the
Common Areas or any other portion of Building other than the
Premises in connection with the making of any Alterations without
Landlord's prior written consent. If any Alterations that Tenant
shall construct result in Tenant or Landlord being required to make
any alterations, additions or improvements to the Premises, or in
Landlord being required to make any alterations, additions or
improvements to any other portions of the
21
22
Building, in any case in order to comply with applicable statutes,
ordinances, rules or regulations of governmental authorities,
including, without limitation, the Americans with Disabilities Act,
Title 24 or any regulations promulgated thereunder, or any similar
state or local statutes, ordinances, rules or regulations, then
Tenant shall be obligated to make all such alterations, additions or
improvements, or, at Landlord's option, Tenant shall reimburse
Landlord upon demand for all cost and expense incurred by Landlord
making such alterations, additions or improvements.
13.7 Initial Tenant Improvements: The initial tenant Improvements are
excluded from clauses 13.1, 13.2, and 13.3.
14. RULES AND REGULATIONS.
Tenant shall comply with (and shall cause its agents, contractors,
employees and invitees to comply with) the rules and regulations attached
hereto as Exhibit "B" and with such modifications thereof and additions
thereto as Landlord may from time to time make. Landlord shall not be
responsible for any violation of such rules and regulations by other
tenants or occupants of the Building. In the event of any conflict between
such rules and regulations and the provisions of this Lease, the
provisions of this Lease shall prevail and be controlling.
15. ENTRY BY LANDLORD.
Landlord shall have the right to enter the Premises at reasonable hours
and after reasonable notice, except In the event of an emergency in which
event no notice shall be required, to: (a) inspect the Premises; (b)
exhibit the same to prospective purchasers, lenders or tenants; (c)
determine whether Tenant is complying with all of its obligations
hereunder; (d) provide janitorial service and any other service to be
provided by Landlord to Tenant hereunder; (e) post notices of
non-responsibility; and (f) make repairs required of Landlord under the
terms hereof or make repairs to any adjoining space or utility services
(including checking, adjusting, calibrating or balancing the HVAC system)
or make repairs, alterations or improvements to any other portion of the
Building. Tenant hereby waives any claim for damages for any injury or
inconvenience to or interference with Tenant's business, any loss of
occupancy or quiet enjoyment of the Premises, and any other loss
occasioned by such entry, provided that Landlord takes reasonable steps to
minimize the interference with Tenant's use and enjoyment of the Premises.
Landlord shall at all times have and retain a key with which to unlock all
of the doors in, on or about the Premises (including Tenant's vaults,
safes and similar areas agreed upon in writing by Tenant and Landlord).
Landlord shall have the right to use any and all means which Landlord may
deem appropriate to open such doors in an emergency in order to obtain
entry to the Premises, and no entry to the Premises obtained by Landlord
by any of such means shall under any circumstance be construed or deemed
to be a forcible or unlawful entry into, or
22
23
a detainer of, the Premises or an eviction, actual or constructive, of
Tenant from the Premises, or any portion thereof.
16. ASSIGNMENT AND SUBLEASE.
16.1 General. Tenant shall not, voluntarily, involuntarily or by
operation of law, without the prior written consent of Landlord: (a)
assign, mortgage, pledge, hypothecate, encumber or otherwise
transfer Tenant's leasehold interest under this Lease; (b) permit
the Premises or any part thereof to be used or occupied by anyone
other than Tenant (whether as concessionaire, franchisee, licensee
or otherwise); or (c) sublease or offer or market for sublease the
Premises or any part thereof. Subject to the provisions of this
Article 16, Landlord shall not unreasonably withhold its consent to
a proposed assignment or sublease. Any of the foregoing acts done
without Landlord's consent shall be void and shall, at the option of
Landlord, terminate this Lease. If Tenant is a corporation, any
dissolution, merger, consolidation or other reorganization of
Tenant, or the sale or other transfer of greater than fifty percent
(50%) of the capital stock in Tenant, shall be deemed a voluntary
assignment of this Lease by Tenant. If Tenant is a partnership or
limited liability company, a withdrawal or change, voluntarily,
involuntarily or by operation of law, of any general partner or any
manager or managing member, as applicable, or any partner or
partners or member or members, as applicable, owning a total of
greater than fifty percent (50%) of the partnership interest of such
partnership or membership interest of such limited liability
company, as applicable, or the dissolution of the partnership or
limited liability company, shall be deemed a voluntary assignment of
this Lease by Tenant.
16.2 Notice and Procedure. If at any time or from time to time during the
Term, Tenant desires to assign this Lease or sublease all or any
part of the Premises, at least thirty (30) days prior to the date on
which Tenant desires the assignment or sublease to be effective
("Transfer Date"), Tenant shall give written notice to Landlord
setting forth the terms and provisions of the proposed assignment or
sublease, the identity of the proposed assignee or subtenant and the
space proposed to be assigned or subleased ("Subject Space"). Tenant
shall promptly supply Landlord with such information concerning the
business background and financial condition of such proposed
assignee or subtenant, and such additional information concerning
the proposed assignment or sublease, as Landlord may reasonably
request, and Tenant's notice shall not be deemed to have been given
until Landlord receives such information. Landlord shall have the
option, exercisable by notice given to Tenant within thirty (30)
days after Landlord's receipt of Tenant's notice (a) in the case of
an assignment or sublease, to terminate this Lease as to the Subject
Space as of the Transfer Date, (b) in the case of a sublease, to
sublease the Subject Space from Tenant on the terms and provisions
set forth in
23
24
Tenant's notice, or (c) consent or decline to consent to the
proposed assignment or sublease in accordance with the provisions of
this Article 16.
16.3 Landlord's Consent. Landlord shall be entitled to consider any
reasonable factor in determining whether or not to consent to a
proposed assignment or sublease. Without limiting any other
circumstances in which it may be reasonable for Landlord to withhold
its consent to a proposed assignment or sublease, Tenant
acknowledges and agrees that it shall be reasonable for Landlord to
withhold its consent to a proposed assignment or sublease under any
of the following circumstances:
(a) The financial condition of the proposed assignee or subtenant
shall not be equal to or greater than Tenant's financial
condition as of the date hereof or shall not satisfy
Landlord's then-current credit standards for tenants of the
Building, or the proposed assignee or subtenant shall not
otherwise have the financial capacity to perform all
obligations under this Lease to be performed by Tenant;
(b) The proposed use of the Premises by the proposed assignee or
subtenant shall (i) not comply with the provisions of Article
9 hereof, (ii) not be consistent with the general character of
businesses carried on by tenants of a first-class office
building, (iii) increase the likelihood of damage or
destruction to the Premises or Building, (iv) increase the
density of occupancy of the Premises, (v) be likely to cause
an increase in insurance premiums for insurance policies
carried by Landlord with respect to the Building, or (vi)
otherwise adversely impact the Premises, the Building or
Landlord's interest therein; or
(c) Any mortgagee or beneficiary under a deed of trust whose
consent to the assignment or sublease is required shall not
consent thereto.
16.4 Conditions. If Landlord consents to an assignment or sublease in
writing, Tenant shall be entitled to assign or sublease the Subject
Space to the proposed assignee or subtenant, subject to the
following conditions:
(a) As of the effective date of such assignment or sublease,
Tenant shall not be in default under this Lease;
(b) The assignment or sublease shall be on the same terms set
forth in Tenant's notice given to Landlord;
(c) No assignment or sublease shall be valid and no assignee or
subtenant shall take possession of the Premises or any portion
24
25
thereof until an executed counterpart of such assignment or
sublease has been delivered to Landlord;
(d) No assignee or subtenant shall have a further right to assign
or sublease;
(e) Any proposed sublease would not result In more than two
subleases of portions of the Premises being In effect during
the term;
(f) Any assignee shall have assumed in writing the obligations of
Tenant under this Lease;
(g) Any subtenant shall have agreed in writing to comply with all
applicable terms and provisions of this Lease; and
(h) After deducting costs associated with obtaining a subtenant,
such as tenant improvements, leasing commissions and legal
fees, any sums or other economic consideration received by
Tenant as a result of such assignment or sublease, however
denominated under the assignment or sublease, which exceed, in
the aggregate, Base Rent which Tenant is obligated to pay
Landlord under this Lease (prorated as to any sublease to
reflect obligations allocable to that portion of the Premises
subject to such sublease), shall be paid to the Landlord as
additional rent under this Lease without affecting or reducing
any other obligations of Tenant hereunder. At Landlord's
request Tenant shall deliver to Landlord such evidence of the
sums or other economic consideration expended or received by
Tenant as a result of the assignment or sublease as Landlord
shall require from time to time.
16.5 Permitted Assignments. Notwithstanding the foregoing provisions,
Tenant shall have the right to assign this Lease or sublease the
Premises or any portion thereof, without Landlord's consent and
without allowing Landlord to exercise the rights set forth in
Section 16.2 (a) or (b) above, to any corporation which controls, is
controlled by or is under common control with Tenant, or to any
corporation resulting from a merger or consolidation with Tenant or
to any person or entity which acquires all of the assets of Tenant's
business as a going concern; provided that (a) the assignee or
subtenant assumes, in full, the obligations of Tenant under this
Lease, (b) Tenant remains fully liable under this Lease, and (c) the
assignee or subtenant fully complies with the provisions of Article
9 above. Tenant shall give Landlord written notification of Tenant's
intention to assign this Lease as permitted under this Section 16.5
and Landlord shall have five (5) business days to respond.
25
26
16.6 Continuing Liability. Regardless of Landlord's consent, no sublease
or assignment shall release Tenant from any of Tenant's obligations
under this Lease, or alter, impair or diminish the primary
liability of Tenant to pay the Rent and to perform all other
obligations to be performed by Tenant hereunder. The acceptance of
Rent by Landlord from any other person shall not be deemed to be a
waiver by Landlord of any provisions hereof. Consent to one
assignment or sublease shall not be deemed consent to any
subsequent assignment or sublease. In the event of a default by an
assignee or subtenant of Tenant or any successor of Tenant in the
performance of any of the terms hereof, Landlord may proceed
directly against Tenant without the necessity of exhausting
remedies against such assignee, subtenant or successor. Landlord
may consent to subsequent assignments of the Lease or subleases or
amendments or modifications of the Lease with assignees of Tenant,
without notifying Tenant or any successor of Tenant, and without
obtaining its or their consent thereto, and any such actions shall
not relieve Tenant of liability under this Lease. If Tenant assigns
the Lease or subleases the Premises or requests the consent of
Landlord to any assignment or sublease, then Tenant shall, upon
demand, pay Landlord an administrative fee of Five Hundred Dollars
($500) plus any attorneys' fees incurred by Landlord in connection
with such act or request.
17. HOLDING OVER.
If after expiration of the Term or earlier termination of this Lease,
Tenant remains in possession of the Premises with Landlord's express
permission. Tenant shall become a tenant from month-to-month only, upon
all the provisions of this Lease (except as to term and Base Rent),
including the obligation to pay Tenant's Proportionate Share of Excess
Operating Costs and Tenant's Proportionate Share of Excess Taxes, but the
Rent payable by Tenant shall be increased to one hundred twenty-five
(125%) of the Rent payable by Tenant at the expiration of the Term or
earlier termination of this Lease. Such monthly Rent shall be payable in
advance on or before the first day of each month. Tenant shall indemnify,
defend and hold Landlord harmless from and against any and all claims,
losses, liabilities, damages, costs and liabilities (including attorneys'
fees) resulting from Tenant's failure to surrender possession, including,
without limitation, any claims made by any succeeding tenant.
18. SURRENDER OF PREMISES.
At the expiration of the Term or upon earlier termination of this Lease,
Tenant shall peaceably surrender possession the Premises to Landlord in
broom-clean condition and in as good condition as when Tenant took
possession, except for reasonable wear and tear. Tenant shall have the
right to remove from the Premises any of Tenant's machinery, equipment,
trade fixtures or furnishings which may be removed without causing damage
to the Premises, and Tenant
26
27
shall remove any Alterations and any other alterations, additions,
improvements, machinery, equipment, trade fixtures or furnishings which
Landlord shall direct to be removed in accordance with the provisions of
this Lease. Tenant shall promptly repair any damage to the Premises or the
Building caused by any such removal. Any personal property of Tenant not
removed from the Premises shall be deemed to have been abandoned by Tenant
and, at Landlord's option, shall thereupon become the property of
Landlord. If Landlord elects to remove all or any part of Tenant's
personal property, the cost of removal, including the cost of repairing
any damage to the Premises or the Building caused by such removal, and the
cost of any storage shall be paid by Tenant. At the expiration of the Term
or upon any earlier termination of this Lease, Tenant shall surrender all
keys to the Premises to the Landlord. No act or conduct of Landlord,
including, without limitation, the acceptance of keys to the Premises,
shall constitute an acceptance of the surrender of the Premises by Tenant
before the expiration of the Term. Only a written notice from Landlord to
Tenant shall constitute acceptance of the surrender of the Premises and
accomplish a termination of the Lease.
19. DESTRUCTION OR DAMAGE.
19.1 Insured Casualty. If the Premises or the portion of the Building
necessary for Tenant's occupancy are damaged by fire, earthquake,
act of God, the elements or other casualty, and Landlord shall have
received insurance proceeds sufficient to fully repair and restore
the Premises and Building, Landlord shall, subject to the provisions
of this Article, promptly repair the damage, if such repairs can, in
Landlord's opinion, be completed within ninety (90) days. If
Landlord determines that repairs can be completed within ninety (90)
days, this Lease shall remain in full force and effect, except that
if such damage is not the result of the negligence or willful
misconduct of Tenant or Tenant's agents, employees, contractors,
licensees or invitees, the Base Rent shall be abated to the extent
Tenant's use of the Premises is impaired, commencing with the date
of damage and continuing until completion of the repairs, but only
to the extent of the rental loss insurance proceeds received by
Landlord by reason of such damage. If, in Landlord's opinion, such
repairs to the Premises or portion of the Building necessary for
Tenant's occupancy cannot be completed within forty-five (45) days,
Landlord may elect, upon notice to Tenant given within thirty (30)
days after the date of damage, to (a) repair such damage, in which
event this Lease shall continue in full force and effect, but the
Base Rent shall be abated as provided above, or (b) terminate this
Lease, or (c) Tenant may elect, after receiving Landlord's notice of
the number of days required to make repairs, to terminate this Lease
if the repairs cannot be completed in forty-five (45) days.
19.2 Uninsured Casualty. If the Premises or the portion of the Building
necessary for Tenant's occupancy are damage by fire, earthquake, act
of
27
28
God, the elements or other casualty, and Landlord shall not have
received insurance proceeds sufficient to fully repair and restore
the Premises and Building, Landlord shall have the right to (a)
repair the damage as soon as reasonably possible at Landlord's
expense (unless the damage or destruction was caused by the
negligence or willful misconduct of Tenant, its employees, agents,
contractors or invitees, in which event Tenant shall pay all costs
of repair), in which case this Lease shall continue in full force
and effect, or (b) terminate this Lease, in which event Landlord
shall give written notice to Tenant within thirty (30) days
following the event of damage of Landlord's election to terminate
this Lease as of the date of the event of damage, and if the damage
was caused by the negligence or willful misconduct of Tenant, its
employees, agents, contractors or invitees, Tenant shall be liable
therefor to Landlord, or (c) Tenant may elect, after receiving
Landlord's notice of the number of days required to make repairs, to
terminate this Lease if the repairs cannot be completed in
forty-five (45) days.
19.3 Building. If any other portion of the Building is damaged, Landlord
may elect, upon notice to Tenant given within thirty (30) days after
the date of such damage (but shall not be obligated), to repair such
damage, in which event this Lease shall continue in full force and
effect. If Landlord shall not elect to make such repairs, Landlord
shall have the right to terminate this Lease as of the date of
expiration of such thirty (30) day period.
19.4 Liability for Tenant's Property. In no event shall Landlord have any
liability for, and in no event shall Landlord be required to repair
or restore, any damage to or destruction of any Alterations or any
machinery, equipment, trade fixtures, furniture or other property
installed by or at the expense of Tenant or otherwise located in the
Premises. If Landlord shall not elect to terminate this Lease
pursuant to this Article, Tenant shall promptly repair or restore
all such property to the condition existing immediately prior to the
event of damage. Landlord shall not be liable for any loss of
business, inconvenience or annoyance arising from any repair or
restoration of any portion of the Premises or Building as a result
of any damage from fire or other casualty.
19.5 Waiver of Remedies. Landlord and Tenant acknowledge and agree that
the rights and obligations of the parties in the event of the damage
or destruction of the Premises shall be as set forth in this
Article. Tenant hereby expressly waives any rights to terminate this
Lease upon damage or destruction of the Premises, except as set
forth in Section 19.1(c) above, or the Building, except as
expressly provided by this Lease, including, without limitation, any
rights pursuant to the provisions of Sections 1932(2) and 1933(4)
of the California Civil Code, as amended, or any other similar
provisions of law.
28
29
20. EMINENT DOMAIN.
20.1 Taking. If the entire Building or Premises is taken by condemnation
or in any other lawful manner for any public or quasi-public
purpose, this Lease shall terminate as of the date of such taking,
and Rent shall be prorated to such date. If less than the entire
Building or Premises is so taken, this Lease shall be unaffected by
such taking, provided that (a) Tenant shall have the right to
terminate this Lease by notice to Landlord given within thirty (30)
days after the date of such taking if twenty percent (20%) or more
of the Premises is taken and the remaining area of the Premises is
not reasonably sufficient for Tenant to continue operation of its
business, and (b) Landlord shall have the right to terminate this
Lease by notice to Tenant given within thirty (30) days after the
date of such taking. If either Landlord or Tenant elects to
terminate this Lease, the Lease shall terminate thirty (30) days
after such notice. The Rent shall be prorated to the date of
termination. If this Lease shall not be terminated upon such partial
taking, the Base Rent and Tenant's Proportionate Share shall be
equitably adjusted according to the remaining Rentable Area of the
Premises and Building.
20.2 Temporary Taking. If the Premises shall be temporarily condemned or
taken for governmental occupancy for a period of more than one year,
this Lease shall terminate as of the date of taking, and Landlord
shall be entitled to any and all compensation, damages, income, rent
and awards in connection therewith. If the Premises shall be
temporarily taken for a period of one year or less, this Lease shall
remain in full force and effect, but any condemnation award as a
result of such taking shall be payable to Tenant.
20.3 Condemnation Award. In the event of any taking, all of the proceeds
of any award, judgment or settlement payable by the condemning
authority shall be the exclusive property of Landlord, and Tenant
hereby assigns to Landlord all of its right, title and interest in
any award, judgment or settlement from the condemning authority.
Tenant, however, shall have the right, to the extent that Landlord's
award is not reduced or prejudiced, to claim from the condemning
authority (but not from Landlord) such compensation as may be
recoverable by Tenant in its own right for relocation expenses and
damage to Tenant's personal property. In no event shall Tenant be
entitled to receive any award for any "bonus value" of this Lease or
otherwise attributable to the value of Tenant's interest under this
Lease or in or to the Premises. Each party hereby waives the
provisions of California Code of Civil Procedure Sections 1265.120
and 1265.130 allowing either party to petition the
29
30
Superior Court to terminate this Lease in the event of a partial
taking of the Premises.
20.4 Restoration. In the event of a partial taking of the Premises which
does not result in a termination of this Lease, Landlord shall
restore the remaining portion of the Premises as nearly as
practicable to its condition prior to the condemnation or taking,
but only to the extent of the portion of the condemnation award
expressly made to Landlord for the purpose of making such
restoration to the Premises. Tenant shall be responsible at its sole
cost and expense for the repair, restoration and replacement of any
Alterations or any of Tenant's machinery, equipment, trade fixtures,
furniture or other personal property of Tenant.
21. INDEMNIFICATION; WAIVER.
21.1 Tenant's Indemnity. Tenant shall indemnify, defend and hold Landlord
and Landlord's employees, agents or contractors harmless against and
from losses, costs, claims, damages, liabilities or causes of action
(including attorneys' fees) arising out of or in any way connected
with: (a) Tenant's use or occupancy of the Premises or the conduct
of Tenant's business thereon, or any work, activity or other things
allowed or suffered by Tenant to be done in or on the Premises; (b)
any breach or default by Tenant in any of Tenant's obligations under
this Lease; (c) any negligent or willful act or omission of Tenant,
its agents, employees, invitees or contractors; or (d) any damage to
any property or injury, illness or death of any person occurring in
or on the Premises, or any part thereof, arising at any time and
from any cause whatsoever unless arising out of gross negligence or
willful misconduct of Landlord. As a material part of the
consideration for Landlord's execution of this Lease, Tenant hereby
assumes all risk of damage or injury to any person or property in or
on the Premises from any cause whatsoever.
21.2 Waiver. Neither Landlord or Landlord's agents, employees or
contractors shall be liable for, and Tenant hereby waives all claims
against Landlord and such other parties with respect to, any injury
or damage which may be sustained by the person or property of
Tenant, its employees, agents, invitees or customers, or any other
person in or about the Premises, caused by or resulting from any
cause whatsoever, including, without limitation, fire, steam,
electricity, gas, water or rain which may leak or flow from or into
any part of the Premises; the breakage, leakage, obstruction or
other defects of pipes, sprinklers, wires, appliances, plumbing,
air-conditioning or lighting fixtures; the interruption of any
public utility or service; acts of the God or the elements, acts of
public enemy, riot, strike, insurrection, war, court order or order
of governmental authority; or explosion, fire or theft, in any case,
whether such damage or injury results from conditions arising
30
31
upon the Premises or upon other portions of the Building or from
other sources, except as to Landlord's gross negligence or willful
misconduct. Neither Landlord or Landlord's agents, employees or
contractors shall be liable for any damages arising from any act or
omission of any other tenant or occupant of the Building. In no
event shall Landlord be liable or responsible in any way for any
loss of business by Tenant, lost profits of Tenant or any other
consequential damages of Tenant or its employees, agents, invitees
or customers, regardless of the cause therefor.
22. TENANT'S INSURANCE.
22.1 Throughout the Term, Tenant shall procure, pay for and maintain in
effect commercial general liability insurance with respect to
Tenant's construction of improvements on the Premises; the use,
operation or condition of the Premises; and the operations of Tenant
in, on or about the Premises, with a minimum coverage of not less
than Two Million Dollars ($2,000,000) combined single limit for
bodily injury, death and property damage liability.
22.2 Property Insurance. Throughout the term, Tenant shall procure, pay
for and maintain in effect a policy of "all risk" property
insurance, with theft, vandalism and malicious mischief
endorsements, covering any Alterations and Tenant's machinery,
equipment, trade fixtures, furniture and other personal property
from time to time in, on or about the Premises, in an amount not
less than one hundred percent (100%) of their actual replacement
cost from time to time. The proceeds of such insurance shall be used
for the repair or replacement of the property so insured. If this
Lease shall terminate following a casualty as set forth herein, the
proceeds of such insurance allocable to Alterations shall be paid to
Landlord, and the proceeds of such insurance allocable to the other
property set forth above shall be paid to Tenant.
22.3 Additional Insurance. Throughout the Term, Tenant shall procure, pay
for and maintain an effect such additional insurance with such forms
of coverage and in such amounts as Landlord shall reasonably
require, including, without limitation, workers' compensation
insurance and employers' liability insurance as required by law.
22.4 Requirements. All insurance required to be carried by Tenant
hereunder shall be issued by responsible insurance companies
acceptable to Landlord and Landlord's lender and qualified to do
business in the State of California. Each policy shall name
Landlord, Landlord's agents and, at Landlord's request, any
mortgagee of Landlord as an additional insureds, as their respective
interests may appear. Each policy shall contain (a) a
cross-liability endorsement, (b) a provision that such policy and
the coverage evidenced thereby shall be primary and noncontributing
with respect to any policies carried by Landlord and that any
coverage carried
31
32
by Landlord shall be excess insurance, and (c) a waiver by the
Insurer of any right of subrogation against Landlord to the extent
required under Section 22.6 below. A copy of each paid up policy
(authenticated by the insurer) or certificate of the insurer
evidencing the existence and amount of each insurance policy
required hereunder shall be delivered to Landlord before the date
Tenant is first given the right of possession of the Premises, and
thereafter within thirty (30) days after any demand by Landlord
therefor. Landlord may, at any time and from time to time, inspect
and/or copy any insurance policies required to be maintained by
Tenant hereunder. No such policy shall be cancelable except after
thirty (30) days' written notice to Landlord and Landlord's lender.
Tenant shall furnish Landlord with renewals or "binders" of any such
policy at least ten (10) days prior to the expiration thereof.
Tenant agrees that if Tenant does not take out and maintain such
insurance, Landlord may (but shall not be required to) procure such
insurance on Tenant's behalf and charge Tenant for the premiums
together with interest thereon at the Interest Rate, payable upon
demand. Tenant shall have the right to provide such insurance
coverage pursuant to blanket policies obtained by the Tenant,
provided such blanket policies expressly afford coverage to the
Premises, Landlord, Landlord's mortgagee and Tenant as required by
this Lease.
22.5 Adjustments. Landlord shall have the right, periodically during the
Term, but not more frequently than once each twelve (12) months, to
require that Tenant increase the coverage amounts for the insurance
that Tenant is obligated to carry under this Lease to amounts to
equal to the then-prevailing coverage amounts required by prudent
landlords of comparable office buildings in Oakland, California, as
determined by Landlord in its reasonable judgment.
22.6 Waiver of Subrogation. Landlord and Tenant each hereby waive all
rights of recovery against the other party, on account of loss by or
damage to the waiving party or its property or the property of
others under its control, to the extent that such loss or damage is
insured against under any property insurance policy which either may
have in force at the time of the loss or damage. To the extent that
such insurance endorsement is available at no or nominal additional
premium charge and does not adversely affect the ability of such
party to obtain such insurance, Landlord and Tenant each agree to
obtain for the benefit of the other party in the insurance policies
carried by the first party a waiver or any right of subrogation
which any insurer of the party may acquire.
23. SUBORDINATION AND ATTORNMENT.
22.1 Subordination of Lease. This Lease shall be subject and subordinate
at all times to the lien of all mortgages and deeds of trust
securing any amount
32
33
now or hereafter encumbering Landlord's interest in the Premises or
Building, all without the necessity of having further instruments
executed on the part of Tenant in order to effectuate such
subordination. Upon the written request of Landlord, Tenant shall
execute, acknowledge and deliver to Landlord such further
instruments evidencing the subordination of this Lease to the lien
of any such mortgages or deeds of trust as may be required by
Landlord, and Tenant shall attorn to any such mortgagee or
beneficiary under any mortgage or deed of trust in the event of a
foreclosure or a deed in lieu of foreclosure, or other purchaser or
a grantee in respect thereof; provided, however, that each mortgagee
or beneficiary under any such mortgage or deed of trust, or
purchaser or grantee in respect thereof, shall agree not to
terminate or disturb Tenant's possession of the Premises under this
Lease in the event of a foreclosure of such mortgage or deed of
trust or a deed in lieu thereof, as long as Tenant is not in default
under this Lease at such time. Notwithstanding the foregoing, any
mortgagee or beneficiary under a mortgage or deed of trust may at
any time subordinate its mortgage or deed of trust to this Lease in
all or in part, without Tenant's consent, by execution of a written
instrument subordinating such mortgage or deed of trust to this
Lease, in which case this Lease shall be deemed prior to such
mortgage or deed of trust without regard to their respective dates
of execution, delivery and/or recording.
23.2 Approval by Lenders. Tenant acknowledges that the provisions of this
Lease may be subject to the approval of any lender that may
hereafter make a loan secured by a mortgage or deed of trust on the
Premises or Building. If such lender shall require, as a condition
of such financing that reasonable modifications be made to this
Lease, at Lender's request, Tenant agrees to execute appropriate
amendments to this Lease to effect such modifications; provided,
however, that such modifications shall not change the size, location
or dimensions of the Premises or increase the amount of the Rent or
the other amounts payable by Tenant under this Lease.
24. ESTOPPEL CERTIFICATES.
Within ten (10) days after written request from Landlord, Tenant shall
execute and deliver to Landlord or Landlord's designee a written statement
certifying (a) that this Lease is unmodified and in full force and effect,
or is in full force and effect as modified and stating the modifications;
(b) the amount of Base Rent and the date to which Base Rent and additional
rent have been paid; (c) the amount of any Security Deposit made with
Landlord; (d) that Landlord is not in default hereunder or, if Landlord is
claimed to be in default, stating the nature of any claimed default; (e)
that Tenant is not in default hereunder, or stating such defaults as
Tenant shall specify; and (f) certifying as to such other matters as
Landlord may reasonable require. Any such statement may be relied upon by
a purchaser, assignee or lender. Tenant's failure to execute and deliver
such
33
34
statement within the time required shall, at Landlord's election, be a
default under this Lease and shall also be conclusive upon Tenant as to
the matters set forth in such statement.
25. TRANSFER OF LANDLORD'S INTEREST.
The term "Landlord" as used herein shall mean only the owner or owners at
the times in question of title to the Premises or the Building. In the
event of any sale or transfer by Landlord of the Premises or Building,
Landlord shall be and is hereby entirely freed and relieved of any and all
liability and obligations contained in or derived from this Lease arising
out of any act, occurrence or omission relating to the Premises, Building
or Lease occurring after the consummation of such sale or transfer. If any
Security Deposit has been made by Tenant, Landlord may transfer the
Security Deposit to Landlord's successor and upon such transfer, Landlord
shall be relieved of further liability with respect thereto. This Lease
shall not affected by any such sale or transfer, and Tenant agrees to
attorn to the purchaser or transferee, such attornment to be effective and
self-operative without the execution of any further instruments on the
part of Landlord or Tenant.
26. DEFAULT.
26.1 Tenant's Default. The occurrence of any one or more of the following
events shall constitute a default and breach of this Lease by
Tenant:
(a) Tenant abandons or vacates the Premises; or
(b) Tenant fails to pay when due any Rent or any other amounts
required to be paid by Tenant under this Lease; or
(c) Tenant fails to perform any other covenant, agreement or
obligation contained in this Lease, and such failure continues
for thirty (30) days after written notice thereof from
Landlord to Tenant; or
(d) A writ of attachment or execution is levied on Tenant's
interest under this Lease; or
(e) Tenant makes a general assignment for the benefit of creditor,
or provides for an arrangement, composition, extension or
adjustment with its creditors; or
(f) Tenant files a voluntary petition for relief under the U.S.
Bankruptcy Code or any other federal or state bankruptcy,
insolvency or debtor relief laws (collectively, "Insolvency
Laws"), or a petition for relief is filed against Tenant under
any Insolvency Laws and not withdrawn or dismissed within
forty-five (45) days thereafter; or
34
35
(g) Appointment of a receiver, trustee, custodian or other person
to take possession of all or substantially all of Tenant's
assets; or
(h) Commencement of proceedings for winding up or dissolving
(whether voluntary or involuntary) Tenant, if Tenant is a
corporation, partnership or limited liability company.
26.2 Remedies. In the event of Tenant's default hereunder, then in
addition to any other rights or remedies Landlord may have under any
law, Landlord shall have the right, at Landlord's option, without
further notice or demand of any kind to do the following:
(a) Terminate this Lease and Tenant's right to possession of the
Premises and reenter the Premises and take possession thereof,
and Tenant shall have no further claim to the Premises or
under this Lease;
(b) Continue this Lease in effect, reenter and occupy the Premises
for the account of Tenant, and collect any unpaid Rent or
other charges which have or thereafter become due and payable;
and/or
(c) Reenter the Premises under the provisions of subparagraph (b),
and thereafter elect to terminate this Lease and Tenant's
right to possession of the Premises.
If Landlord reenters the Premises under the provisions of
subparagraphs (b) or (c) above, Landlord shall not be deemed to have
terminated this Lease or the obligation of Tenant to pay any Rent or
other amounts payable hereunder, unless Landlord notifies Tenant in
writing of Landlord's election to terminate this Lease. In the event
of any reentry or retaking of possession by Landlord, Landlord shall
have the right, but not the obligation, to remove all or any part of
Tenant's personal property in the Premises and to place such
property in storage at a public warehouse at the expense and risk of
Tenant. If Landlord elects to relet the Premises for the account of
Tenant, the rent received by Landlord from such reletting shall be
applied as follows: first, to the payment of any indebtedness other
than Rent due hereunder from Tenant to Landlord; second, to the
payment of any costs of such reletting; third, to the payment of the
cost of any alterations or repairs to the Premises; fourth, to the
payment of Rent due and unpaid hereunder; and the balance, if any,
shall be held by Landlord and applied in payment of future Rent as
it becomes due. If that portion of rent received from the reletting
which is applied against the Rent due hereunder is less than the
amount of the Rent due, Tenant shall pay the deficiency to Landlord
promptly upon demand by Landlord. Such deficiency shall be
calculated and paid monthly. Tenant shall also pay to Landlord, as
soon as determined, any costs and expenses incurred by
35
36
Landlord in connection with such reletting or in making alterations
and repairs to the Premises, which are not covered by the rent
received from the reletting.
If Landlord shall terminate this Lease under the provisions of
subparagraphs (a) or (c) above, in addition to any of the rights and
remedies to which Landlord may be entitled under applicable law,
Landlord may recover as damages from Tenant the following:
(1) Past Rent. The worth at the time of the award of any unpaid
Rent which had been earned at the time of termination; plus
(2) Rent Prior to Award. The worth at the time of the award of the
amount by which the unpaid Rent which would have been earned
after termination until the time of award exceeds the amount
of such rental loss that Tenant proves could have been
reasonably avoided; plus
(3) Rent After Award. The worth at the time of the award of the
amount by which the unpaid Rent for the balance of the Term
after the time of award exceeds the amount of the rental loss
that Tenant proves could be reasonably avoided; plus
(4) Proximately Caused Damages. Any other amount necessary to
compensate Landlord for all detriment proximately caused by
Tenant's failure to perform its obligations under this Lease
or which in the ordinary course of things would be likely to
result therefrom, including, but not limited to, any costs or
expenses (including attorneys' fees), incurred by Landlord in
(a) retaking possession of the Premises, (b) maintaining the
Premises after Tenant's default, (c) preparing the Premises
for reletting to a new tenant, including any repairs or
alterations, and (d) reletting the Premises, including
brokers' commissions.
"The worth at the time of the award" as used in subparagraphs (1)
and (2) above is to be computed by allowing interest at the Interest
Rate. "The worth at the time of the award" as used in subparagraph
(3) above is to be computed by discounting the amount at the
discount rate of the Federal Reserve Bank situated nearest to the
Premises at the time of the award plus one percent (1%).
The waiver by Landlord of any breach of any term, covenant or
condition of this Lease shall not be deemed a waiver of such term,
covenant or condition or of any subsequent breach of the same or any
36
37
other term, covenant or condition. Acceptance of Rent by Landlord
subsequent to any breach hereof shall not be deemed a waiver of any
preceding breach other than the failure to pay the particular Rent
so accepted, regardless of Landlord's knowledge of any breach at the
time of such acceptance of Rent. Landlord shall not be deemed to
have waived any term, covenant or condition unless Landlord gives
Tenant written notice of such waiver.
26.3 Landlord's Default. In no event shall Landlord be deemed to be in
default under this Lease unless and until Landlord shall have
defaulted in the performance of its obligations under this Lease and
Tenant shall have given to Landlord written notice of the default
and, within a reasonable period of time following Landlord's receipt
of such notice, but in no event less than thirty (30) days following
Landlord's receipt of such notice, Landlord shall not commence
diligently to prosecute the cure of such default to completion. In
the event of any alleged default on the part of Landlord under this
Lease, Tenant shall give notice by registered mail to any
beneficiary or mortgagee of a deed of trust or mortgage encumbering
the Premises whose address shall have been furnished to Tenant, and
shall offer such beneficiary or mortgagee a reasonable opportunity
to cure the default, including time to obtain possession of the
Premises by power of sale or judicial foreclosure, if such shall be
necessary to effect a cure. Tenant shall not have the right to
terminate this Lease or to withhold, reduce or offset any amount
against any payments of Rent or any other amounts due and payable
under this Lease except as otherwise specifically provided herein.
The liability of Landlord under this Lease or otherwise in the
connection with the Premises or the Building shall be limited to
Landlord's interest in the Building, and in no event shall any other
assets of Landlord or any assets of any constituent partner or
member of Landlord be subject to any liability arising out of or in
connection with this Lease, the Premises or the Building.
27. BROKERS.
Tenant represents and warrants that Tenant has not dealt with any real
estate broker, agent, finder or salesperson in connection with this Lease,
except the real estate broker listed in Article 1. Tenant shall indemnify,
defend and hold Landlord harmless from and against any and all losses,
costs, claims, damages, liabilities and cause of action (including
attorneys' fees) arising out of or relating to any breach of the foregoing
representation warranty or arising out of or related to any claim made by
any broker, agent, finder, or salesperson claiming to have dealt with
Tenant.
28. NOTICES.
All notices and other communications permitted or required to be given
under this Lease shall be in writing and deemed duly served or given when
personally
37
38
delivered or transmitted by a private nationally recognized overnight
courier service, or forty-eight (48) hours after deposit in the United
States mail, certified or registered, postage prepaid, and addressed as
follows: (a) if to Landlord, to Landlord's Notice Address and to the
Building manager, and (b) if to Tenant, to Tenant's Notice Address;
provided, however, notices to Tenant shall be deemed duly served or given
if delivered or mailed to Tenant at the Premises. Landlord and Tenant may
from time to time by written notice to the other party designate another
address for receipt of future notices.
29. QUIET ENJOYMENT.
Tenant, upon paying the Rent and performing all of its other obligations
under this Lease, shall peaceably and quietly enjoy the Premises
throughout the Term without any hindrance or interruption by Landlord or
any person lawfully claiming by, through or under Landlord, subject to the
terms of this Lease and to any mortgage, or deed of trust to which this
Lease may be subordinate.
30. FORCE MAJEURE.
Any prevention, delay or stoppage of work to be performed by Landlord or
Tenant which is due to strikes, lockouts, other labor disputes, inability
to obtain labor, materials, equipment or reasonable substitutes therefor,
acts of God, governmental restrictions or regulations or controls,
judicial orders, enemy or hostile government actions, civil commotion,
fire or other casualty, or other causes beyond the reasonable control of
the party obligated to perform hereunder, shall excuse performance of the
work by that party for a period equal to the duration of that prevention,
delay or stoppage. Notwithstanding the foregoing, in no event shall
Tenant's obligation to pay Rent or other amounts payable under the Lease
be excused or delayed.
31. SIGN CONTROL.
Tenant shall not place or cause to be placed, erected or maintained on any
exterior door, wall, window or roof of the Premises or the Building, or on
the glass of any window or door of the Premises, or on any sidewalk or
other location outside of the Premises, any sign, plaque, decoration,
light, lettering or other advertising material of any kind or description
(collectively, "Signage") without Landlord's prior written consent. The
size, content, design and/or location of any Signage shall be subject to
Landlord's prior written approval, and shall comply with all applicable
statutes, ordinances, rules and regulations of governmental authorities.
If Tenant shall place or cause to be placed or shall maintain any Signage
in violation of the foregoing provisions then, without limiting Landlord's
other rights by reason thereof, Landlord shall have the right to cause the
same to removed without notice to Tenant and without being liable to
Tenant by reason of such removal. Landlord shall have the right to charge
the cost of removal to Tenant as additional rent hereunder, payable within
ten (10) days of written demand by Landlord. Landlord shall have the right
to
38
39
place or cause to be placed and to maintain on the exterior of the
Building such Signage as Landlord shall desire.
32. MISCELLANEOUS.
32.1 Accord and Satisfaction; Allocation of Payments. No payment by
Tenant or receipt by Landlord of a lesser amount than the Rent
provided for in this Lease shall be deemed to be other than on
account of the earliest due Rent. No endorsement or statement on any
check or letter accompanying any check or payment made on account of
Rent shall be deemed an accord and satisfaction, and Landlord may
accept such check or payment without prejudice to Landlord's right
to recover the balance of the Rent or pursue any other remedy
provided for in this Lease. In connection with the foregoing,
Landlord shall have the absolute right in its sole discretion to
apply any payment received from Tenant to any amount owing by Tenant
and then due and payable.
32.2 Attorneys' Fees. If any action or proceeding is brought by either
party against the other pertaining to or arising out of this Lease,
the prevailing party in such action or proceeding shall be entitled
to recover all costs and expenses of such action or proceeding,
including attorneys' fees, and costs.
32.3 Captions. The captions of Articles and Sections 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. All references to Article and Section numbers refer to
Articles and Sections in this Lease.
32.4 Governing Law. This Lease shall be governed by, and construed and
enforced in accordance with, the laws of the State of California.
32.5 Consent. Notwithstanding anything to the contrary contained in this
Lease, Tenant shall have no claim for, and hereby waives the right
to any claim against Landlord for, money damages by reason of any
refusal, withholding or delaying by Landlord of any consent or
approval, and in such event Tenant's only remedies therefor shall be
an action for specific performance, injunction or declaratory
judgment to enforce any right of such consent or approval.
32.6 Authority. If Tenant executes this Lease as a corporation,
partnership or limited liability company, each of the persons
executing this Lease on behalf of Tenant does hereby covenant and
warrant that Tenant is a duly authorized and existing entity, that
Tenant has full right and authority to enter into this Lease, and
that each of the persons executing this Lease on behalf of Tenant
are authorized to do so. Upon Landlord's request,
39
40
Tenant shall provide Landlord with evidence reasonably satisfactory
to Landlord confirming the foregoing covenants and warranties.
Landlord does hereby covenant and warrant that Landlord or
Landlord's Agent, Colliers International, is authorized to sign this
Lease.
32.7 Counterparts. This Lease may be executed in multiple counterparts,
each of which shall be deemed to be an original, but all of which,
taken together, shall constitute one and the same Lease.
32.8 Execution of Lease; No Option. The submission of this Lease to
Tenant shall be for examination purposes only, and does not and
shall not constitute a reservation of or option for Tenant to lease,
or otherwise create any interest of Tenant in the Premises or any
other premises within the Building. The execution of this Lease by
Tenant and its return to Landlord shall not be binding on Landlord
notwithstanding any time interval, until Landlord has in fact signed
and delivered this Lease to Tenant.
32.9 Financial Statements. Tenant shall promptly furnish Landlord, from
time to time, upon Landlord's written request, with financial
statements reflecting Tenant's current financial condition. Tenant
represents and warrants that all financial statements, records and
information furnished by Tenant to Landlord in connection with this
Lease are true, correct and complete in all respects.
32.10 Further Assurances. Each party shall promptly execute all
documents and take such other and further acts as maybe reasonably
requested by the other party in order to give effect to the
provisions of this Lease.
32.11 Prior Agreements; Amendments. This Lease contains all of the
agreements of the parties with respect to any matter covered in this
Lease, and no prior agreement or understanding pertaining to any
such matter shall be effective for any purpose. This Lease may not
be amended except by an agreement in writing signed by the parties
hereto or their respective successors-in-interest.
32.12 Recording. Tenant shall not record this Lease without the prior
written consent of Landlord. Tenant, upon the request of Landlord,
shall execute and acknowledge a "short form" or memorandum of this
Lease for recording purposes.
32.13 Severability. If any provision of this Lease or the application
thereof to any person or circumstance shall, to any extent, be
invalid or unenforceable, the remainder of this Lease, or the
application of such provision to persons or circumstances other than
those as to which it is invalid or unenforceable, shall not be
affected thereby, and each provision of this Lease shall be valid
and enforceable to the fullest extent permitted by law.
40
41
32.14 Successors and Assigns. Subject to the provisions of Article 16 of
this Lease, this Lease shall be binding upon, and shall inure to the
benefit of, the heirs, personal representatives, successors and
assigns of the parties hereto.
32.15 Time of the Essence. Time is of the essence of this Lease and each
and every provision hereof.
32.16 Waiver. No delay or omission in the exercise of any right or remedy
of Landlord upon any default by Tenant shall impair such right or
remedy or be construed as a waiver of such default. The receipt and
acceptance by Landlord of delinquent Rent shall not constitute a
waiver of any other default; it shall constitute only a waiver of
timely payment for the particular Rent payment involved. Landlord's
consent to or approval of any act by Tenant requiring Landlord's
consent or approval shall not be deemed to waive or render
unnecessary Landlord's consent to or approval of any subsequent act
by Tenant. Any waiver by Landlord or any default must be in writing
and shall not be a waiver of any other default concerning the same
or any other provision of the Lease.
32.17 No Merger. A voluntary or other surrender of this Lease by Tenant,
or a mutual cancellation thereof, shall not work a merger, and
shall, at the option of Landlord, either terminate any existing
subleases or operate as an assignment to Landlord of any such
subleases.
32.18 No Light, Air or View Easement. Nothing contained in this Lease
shall grant to or confer upon Tenant any right to receive any
particular amount or level of light, air or view from the Premises.
Any diminution in or shutting off of light, air or view by any
structure which is now or may hereafter be erected on property
adjacent to the Building shall in no way affect this Lease or impose
any liability upon Landlord. Noise, dust or vibration or other
aspects of the new construction of improvements on property adjacent
to the Building, whether or not owned by Landlord, shall in no way
affect this Lease or impose any liability on Landlord.
32.19 No Representations or Warranties. Neither Landlord nor Landlord's
officers, directors, shareholders, members, partners, employees,
agents or contractors have made any representations or warranties
with respect to the Premises, the Building or this Lease, except as
expressly set forth herein.
32.20 Name. Tenant shall not use the name of the Building for any purpose
other than as an address of the business to be conducted by Tenant
in the Premises. Landlord shall have the right to change the name of
the Building and/or the street address of the Building from time to
time in Landlord's sole discretion.
41
42
32.21 Exhibits, Addendum. The exhibits listed below and the addendum, If
any, listed below, are incorporated by reference into this Lease:
(a) Exhibit "A" - Floor Plan of Premises
(b) Exhibit "B" - Rules and Regulations
(c) Exhibit "C" - Work Agreement
(d) Addendum
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the
date first set forth above.
LANDLORD TENANT
CENTRAL BUILDING LLC CYBERGOLD, INC.
By Its Managing Agent By: /s/ CYBERGOLD
--------------------------------
COLLIERS INTERNATIONAL Its: Chief Operating Officer
-------------------------------
By: /s/ COLLIERS INTERNATIONAL
-----------------------------------
Its: Managing Agent
-----------------------------------
42
43
EXHIBIT "A"
FLOOR PLAN OF PREMISES
43
44
EXHIBIT "B"
RULES AND REGULATIONS
Unless otherwise defined herein, capitalized terms used in these Rules and
Regulations have the meanings given to such terms in the Lease.
1. Landlord may from time to time adopt appropriate systems and procedures
for the security or safety of the Building, any persons occupying, using or
entering the Building, or any equipment, furnishings or contents of the
Building, and Tenant will comply with Landlord's requirements relating to such
systems and procedures.
2. The sidewalks, halls, passages, exits, entrances, elevators and
stairways of the Building may not be obstructed by any Tenant or used by Tenant
for any purpose other than for ingress to and egress from the Premises. Tenant
may not go upon the roof of the Building except as may be permitted in writing
by Landlord. Tenant may not place or install any object (including, without
limitation, radio and television antenna, loud speakers, sound amplifiers,
microwave dishes, solar devices, or similar devices) on the exterior of the
Building or on the roof of the Building.
3. No sign, placard, picture, name, advertisement or written notice
visible from the exterior of the Premises may be inscribed, painted, affixed or
otherwise displayed by Tenant on any part of the Building or the Premises
without the prior written consent of Landlord. Tenant shall conform to
Landlord's general guidelines relating to signs inside the Building on the
office floors. All approved signs or lettering on doors will be printed,
painted, affixed or inscribed at the expense of Tenant by a person approved by
Landlord. Material visible from outside the Building will not be permitted.
Landlord may remove all items in violation of the foregoing without any
liability, and may charge the expense incurred by such removal to Tenant.
4. The Premises shall not be used for the storage of merchandise held for
sale to the general public or for lodging. Tenant shall not use or permit the
use of the Premises in any manner which involves an unusual risk of injury to
any person. No cooking is allowed in the Premises, except in areas of the
Premises which are specially constructed for cooking and except that use by
Tenant of microwave ovens and Underwriters' Laboratory approved equipment for
brewing coffee, tea, hot chocolate and similar beverages will be permitted,
provided that such use is in accordance with all applicable laws.
5. Tenant may not employ any person or persons other than the janitor of
Landlord for the purpose of cleaning the Premises, unless otherwise agreed to by
Landlord in writing. If Tenant's actions result in any increased expense for any
required cleaning, Landlord shall have the right to assess Tenant for such
expenses. Janitorial service will not be furnished on nights rooms are occupied
after 9:00 p.m. unless, by prior agreement, Landlord shall have agreed to extend
service to a later hour for specifically designated rooms.
6. Landlord will furnish Tenant with two (2) keys to the Premises.
Additional keys shall be obtained only from Landlord, and Landlord may impose a
reasonable charge for such additional keys. No additional locking devices shall
be installed in the Premises by Tenant, nor
44
45
shall any locking device be changed or altered in any respect without the prior
written consent of Landlord. Tenant shall provide Landlord with keys to all
locks installed in the Premises, excluding Tenant's vaults and safes. Upon the
expiration or earlier termination of the Lease, Tenant shall deliver to Landlord
all keys to doors in the Premises.
7. The restrooms, toilets, urinals, wash bowls and other plumbing fixtures
may not be used for any purposes other than those for which they were
constructed, and no sweepings, rubbish, rags or other foreign substances may be
deposited in such plumbing fixtures. All damages resulting from Tenant's misuse
of such fixtures will be assessed to Tenant.
8. The elevator designated for freight by Landlord will be available for
use by Tenant during the hours and pursuant to such procedures as Landlord may
determine from time to time. The persons employed to move Tenant's equipment,
material, furnishings, supplies, furniture or other property in or out of the
Building must be acceptable to Landlord. The moving company must be a locally
recognized professional mover, whose primary business is the performing of
relocation services, and must be bonded and fully insured. A certificate or
other verification of such insurance must be received and approved by Landlord
prior to the start of any moving operations. Such insurance must be sufficient
in Landlord's sole opinion to cover all personal liability, theft or damage to
the Premises and the Building, including, but not limited to, floor coverings,
doors, walls, elevators, stairs and landscaping. All moving operations will be
conducted at such times and in such a manner as Landlord will direct, and all
moving will take place during non-business hours unless Landlord otherwise
agrees in writing. Tenant will be responsible for the provision of Building
security during all moving operations, and will be liable for all losses and
damages sustained by any party as a result of the failure to supply adequate
security. Landlord will have the right to prescribe the weight, size and
position of all property brought into the Building. Heavy objects will, if
considered necessary by Landlord, stand on wood strips of such thickness as is
necessary to properly distribute the weight. Landlord will not be responsible
for loss of or damage to any property from any cause, and all damage done to the
Premises or the Building will be repaired at the expense of Tenant. Landlord
reserves the right to inspect all such property to be brought into the Building
and to exclude from the Building all property which violates any of these Rules
and Regulations or the Lease.
9. Tenant will not use or keep in the Premises or the Building any
kerosene, gasoline or inflammable, combustible or explosive fluid or material or
chemical substance. Without Landlord's prior written approval, Tenant will not
use any method of heating or air-conditioning other than that supplied by
Landlord. Tenant will not use or keep or permit to be used or kept any foul or
noxious gas or substance in the Premises.
10. Landlord may from time to time and without any liability to Tenant
change the name and street address of the Building.
11. Landlord may prohibit any advertising by Tenant mentioning the
Building, which, in Landlord's reasonable opinion, tends to impair the
reputation of the Building or its desirability as a building for offices, and
upon written notice from Landlord, Tenant will refrain from or discontinue such
advertising.
45
46
12. Tenant will not permit bicycles or other vehicles inside or on the
sidewalks outside the Building except in areas designated from time to time by
Landlord for such purposes.
13. All persons entering or leaving the Building between the hours of 6:00
p.m. and 7:00 a.m. Monday through Friday, and at all hours on Saturdays, Sundays
and holidays will comply with such off-hour regulations as Landlord may
establish and modify from time to time. Landlord reserves the right to limit or
restrict access to the Building during such time periods.
14. Tenant will store all its trash and garbage within its Premises. No
material will be placed in the trash boxes or receptacles if such material is of
such nature that it may not be disposed of in the ordinary and customary manner
of removing and disposing of trash and garbage without being in violation of any
applicable law. All garbage and refuse disposal will be made only through
entryways and elevators provided for such purposes and at such times as Landlord
designates. Removal of any furniture or furnishings, large equipment, packing
crates, packing materials and boxes will be the responsibility of Tenant and
such items may not be disposed of in the Building trash receptacles nor will
they be removed by the Building's janitorial service, except at Landlord's sole
option and at Tenant's expense. No furniture, appliances, equipment or flammable
products of any type may be disposed of in the Building trash receptacles.
15. Canvassing, peddling, soliciting and distribution of handbills or any
other written materials in the Building are prohibited.
16. Employees, agents and contractors of Landlord will not perform any
work or do anything outside of their regular duties unless under special
instructions from Landlord, and Landlord shall assess the cost thereof, together
with an administrative fee of 15%, upon Tenant.
17. A directory of the Building will be provided for the display of the
name and location of tenants only. All entries on the Building directory display
will conform to standards and style set by Landlord in its sole discretion.
Tenant will not have any right to the use of any exterior sign.
18. Tenant will ensure that the doors of the Premises are closed and
locked and that all water faucets, water apparatus and utilities are shut off
before Tenant leaves the Premises. On multiple-tenant floors, Tenant will keep
the doors to the Building corridors closed at all times except when using them
for ingress and egress.
19. Tenant will not conduct itself in any manner which is inconsistent
with the character of the Building as a first class office building or which
will impair the comfort and convenience of other tenants in the Building.
20. Tenant shall not obtain for use in the Premises any shoe polishing,
massage or other similar services without the prior written consent of Landlord.
The provision of any such goods and services shall be subject to such reasonable
rules and regulations and at such
46
47
reasonable hours as may be established by Landlord. The suppliers of such
services shall be subject to Landlord's prior written approval.
21. Except with the prior written consent of Landlord, Tenant shall not
permit the sale from the Premises of, or use or permit the use of any sidewalk
adjacent to the Premises for the sale of, newspapers, magazines, periodicals,
theater tickets or other goods or services, and Tenant shall not carry on or
permit or allow any employee or other person to carry on business in or from the
Premises for the service or accommodation of occupants of any other portion of
the Building.
22. Tenant shall not use in any portion of the Building, including Common
Areas, any hand trucks except those equipped with rubber tires and side guards
or such other material-handling equipment as Landlord shall approve. No other
vehicles of any kind shall be brought by Tenant into the Building or in or about
the Premises.
23. Tenant assumes all responsibility for protecting the Premises from
theft, robbery or vandalism, which includes keeping doors locked and other means
of entry closed.
24. No vending machines shall be maintained or operated within the
Premises of the Building without the prior written consent of Landlord. Any food
or beverages permitted in writing by Landlord to be brought onto the Premises
must be properly stored or maintained at all times.
25. No animal or bird shall be permitted in the Premises to the Building
except seeing eye dogs.
26. The requirements of Tenant will be attended to only upon application
by telephone or in writing at the Building office.
27. No act or thing done or omitted to be done by Landlord or Landlord's
agents, employees or contractors in connection with the enforcement of these
Rules and Regulations will constitute an eviction by Landlord of Tenant. Under
no circumstances will Landlord be liable to Tenant for failing to enforce these
Rules and Regulations against any other tenant in the Building, or for the
breach of these Rules and Regulations by any other Tenant, and Landlord may
modify these Rules and Regulations for any other tenant of the Building. No such
failure to enforce these Rules and Regulations by Landlord, or breach of these
Rules and Regulations by any other tenant, or modification of these Rules and
Regulations for any other tenant, shall relieve Tenant from fully complying with
these Rules and Regulations or preclude Landlord from enforcing these Rules and
Regulations against Tenant.
28. All references to "Tenant" in these Rules and Regulations shall
include, and Tenant shall ensure that these Rules and Regulations are fully
complied with by, all employees, agents, contractors, invitees, customers,
clients and licensees of Tenant and all other persons permitted by Tenant to use
or occupy the Premises.
29. Landlord may waive any one or more of the provisions of these Rules
and Regulations for the benefit of any particular tenant or tenants in the
Building, but no such waiver by Landlord will be construed as a waiver of such
provisions in favor of Tenant, and no
47
48
waiver in any instance of any of the provisions of these Rules and Regulations
in favor of Tenant shall prevent Landlord from thereafter enforcing such
provisions.
30. Tenant shall be responsible for, and shall indemnify, defend and hold
harmless Landlord from and against, all costs, expenses, damages, claims and
liability arising out of the failure by Tenant or any of its employees, agents,
contractors, licensees, invitees, customers, clients, or any other person
occupying or using the Premises, to comply with these Rules and Regulations.
31. Any failure of Tenant to comply with these Rules and Regulations shall
constitute an Event of Default under the Lease, thereby entitling Landlord to
exercise all rights and remedies under Article 26 of the Lease.
32. These Rules and Regulations are in addition to, and will not be
construed to modify or amend, in whole or in part, the terms, covenants,
agreements and provisions of the Lease. These Rules and Regulations may be
amended from time to time by Landlord, and Tenant shall comply with all such
amendments.
48
49
EXHIBIT "C"
WORK AGREEMENT
This Work Agreement is hereby incorporated into and made a part of
the Standard Office Lease dated March 25, 1999 ("Lease"), by and between Central
Building LLC, a Limited Liability corporation, hereinafter referred to as
"Landlord", and Cybergold, Inc., a California corporation, hereinafter referred
to as "Tenant."
1. Immediately upon the execution of this Lease, Landlord and Tenant shall
agree upon a mutually acceptable space plan. Based on this space plan Landlord
shall have Working Drawings prepared for construction. Following Landlord's
preparation of the Working Drawings, Landlord shall enter into a construction
contract with Landlord's contractor which shall provide for the construction of
the Tenant Improvements in accordance with the Working Drawings.
2. The cost of construction and installation of the Tenant Improvements
shall include the following costs and expenses paid or incurred by Landlord: all
costs of the architect's and any engineers' preparation of the Working Drawings;
the costs of obtaining a building permit and any other construction-related
permits from the City of Oakland and any other applicable governmental
authorities which are required in order to authorize Landlord's construction of
the Tenant Improvements; all amounts paid by Landlord to Landlord's contractor
under the construction contract for the Tenant Improvements; and any other costs
and expenses paid or incurred by Landlord in connection with the planning and
construction of the Tenant Improvements ("Tenant Improvement Costs"). Landlord
shall provide Tenant with a Tenant Improvement Allowance in the amount of Twenty
Dollars ($20.00) per rentable square foot for the fourth floor Premises and
Twenty Dollars ($20.00) per rentable square foot for the third floor Premises
("Tenant Improvement Allowance") with respect to the Tenant Improvements, and
the Tenant Improvement Costs shall be charged against the Tenant Improvement
Allowance to the extent thereof. Tenant shall bear all Tenant Improvement Costs
in excess of the amount of the Tenant Improvement Allowance. Tenant's share of
the Tenant Improvements Costs is hereinafter referred as "Tenant's Costs."
Tenant shall pay any Tenant's Costs to Landlord or to the appropriate parties
therefor, at Landlord's option, either prior to Landlord's commencement of
construction and installation of the Tenant Improvements, or as and when Tenant
receives invoices for such amounts from Landlord and/or Landlord's contractor.
If the actual amount of the Tenant Improvement Costs shall be less than the
Tenant Improvement Allowance, Tenant shall have no right to such amounts and
shall not be entitled to any reduction in any of Tenant's rental or other
obligations under this Lease by reason thereof.
3. For the purposes of this Lease, the terms "Substantially Completed" or
"Substantial Completion" shall mean that the Tenant Improvements shall have been
completed except for minor deviations from the Working Drawings and "punch-list"
items that do not materially affect Tenant's use of the Premises for the
purposes permitted under the Lease. The date of Substantial Completion of the
Tenant Improvements shall be established by Landlord in a notice delivered to
Tenant, which notice shall state that the Tenant Improvements are, or on a
future date specified in such notice will be, Substantially Completed, and that
the Premises are, or on such future date will be, ready for occupancy by Tenant.
Notwithstanding the foregoing or
49
50
anything to the contrary contained in Section 3.2 of the Lease, if Landlord
shall be delayed in Substantial Completion of the Tenant Improvements as a
result of:
(a) Delays caused by the acts or omissions of Tenant, its employees,
agents or contractors, including, without limitation, delays caused by Tenant's
failure to furnish any information or approve any item within the time period
specified therefor in this Work Agreement or in the Lease;
(b) Delays caused by change orders requested by Tenant or required
because of any errors or omissions in plans submitted by Tenant; or
(c) Delays caused by Landlord to accommodate Tenant's performance of
any approved construction, installation or other work in the Premises which
Tenant has elected or is required to perform (all of the foregoing being
referred to herein collectively as a "Tenant Delay"), then notwithstanding
anything to the contrary contained in Section 3.2 of the Lease, the Commencement
Date shall be the earlier of the date specified in Section 3.2 of this Lease or
that number of days prior to the date on which the Tenant Improvements shall be
Substantially Completed which is equal to the total number of days of Tenant
Delay.
4. Tenant shall have the right to enter the Premises not earlier than
fifteen (15) days prior to the anticipated date of Substantial Completion of
the Tenant Improvements for the purposes of installing Tenant's telephone
systems, computer lines, cables and equipment in the Premises; provided,
however, that (a) no such entries onto or activities on the Premises by Tenant
shall disrupt or in any manner interfere with Landlord's construction of the
Tenant Improvements, and (b) Tenant shall have no right to move any furniture or
other personal property onto the Premises until Landlord shall deliver
possession of the Premises to Tenant pursuant to this Lease. Any such entries
onto the Premises by Tenant prior to the date of Substantial Completion of the
Tenant Improvements shall be on all of the terms and provisions of this Lease,
except that Tenant shall not be obligated to pay Base Rent for the period of
such early entry.
5. Landlord has not agreed to perform any work in the Premises or to pay
any costs and expenses of Landlord or Tenant in performing any work in the
Premises, other than Landlord's construction of the Tenant Improvements and
Landlord's provision of the Tenant Improvement Allowance in accordance with the
provisions of this Work Agreement with the exception of elevator access controls
which are to be installed with the renovations of the building elevators and the
vestibule walls and doors at both stairwells, at Landlord's sole cost. Until
completion of the elevator renovation project, Landlord agrees to secure
elevators after working hours so that the fourth floor is inaccessible. If at
Tenant's request, Landlord agrees to perform any other work in connection with
the Premises, such work shall be performed at Tenant's sole cost and expense in
accordance with plans, drawings and specifications furnished by Tenant to
Landlord and subject to the approval of Landlord. If Landlord elects to perform
any other work for Tenant, prior to commencing any such work, Landlord shall
submit to Tenant written estimates of the cost thereof (including Landlord's
construction management fee in the percentage specified above) and if Tenant
shall fall to disapprove such estimates within five (5) business days following
Tenant's receipt thereof, such estimates shall be deemed to be approved. If such
work is approved or deemed approved, Landlord shall be authorized to proceed
with such work. Tenant shall pay for the cost of such work to Landlord or to the
50
51
appropriate parties therefor, at Landlord's option, either prior to Landlord's
commencement of construction and installation of such work, or as and when
Tenant receives invoices for such amounts from Landlord and/or Landlord's
contractor.
51
52
ADDENDUM TO STANDARD OFFICE LEASE
THIS ADDENDUM TO STANDARD OFFICE LEASE shall constitute part of that
certain Standard Office Lease dated March 25, 1999 ("Lease"), by and between
Central Building LLC, a Limited Liability corporation ("Landlord") and
Cybergold, Inc., a California corporation ("Tenant"), and the terms hereof shall
for all purposes be deemed incorporated into the Lease and shall supersede any
provisions of the Lease which are inconsistent herewith.
33. RENEWAL OPTION.
33.1 Option. Subject to the provisions set forth below, Tenant shall have
the option to renew this lease for one additional term of five (5)
years (the "Renewal Term"), which Renewal Term shall commence upon
the expiration of the original Term of this Lease ("Initial Term").
All of the terms, covenants and conditions of this Lease shall
govern the Renewal Term, except as otherwise specifically set forth
hereinafter or if inapplicable thereto. As used in this Lease, the
word "Term" shall mean the Term as the same may be extended pursuant
to the provisions of this Section 33, as applicable.
33.2 Terms and Conditions. Tenant's option to renew, as provided above,
shall be conditioned upon and subject to each of the following:
(a) Tenant shall notify Landlord in writing of its exercise of its
option to renew at least one hundred eighty (180) days prior
to the expiration of the Initial Term;
(b) At the time Landlord receives Tenant's notice or at any time
thereafter until the beginning of any Renewal Term, as
provided above, Tenant shall not be in default or shall cure
any default that has occurred during the notification period,
under the Lease;
(c) Tenant shall have no further renewal option other than the
option to extend for the Renewal Term as set forth above;
(d) Tenant shall continue possession of the Premises in their
as-is condition and Landlord shall have no obligation to do
any work or otherwise to prepare the Premises for the Renewal
Term; and
(e) The Base Rent during the Renewal Term shall be at the
Prevailing Market Rate (as defined below).
33.3 Prevailing Market Rate.
(a) As used in this Lease, "Prevailing Market Rate" shall mean the
rate being charged for comparable space in comparable office
buildings in the Xxxxxxx Xxxxxxxx Xxxxxxxx xx Xxxxxxx,
Xxxxxxxxxx as of the date of commencement of
52
53
the Renewal Term, with similar amenities, taking into
consideration the size, location, proposed term of the lease,
extent of services to be provided, the fact that the Premises
have been improved with the Tenant Improvements, the time that
the particular rate under consideration became or is to become
effective, and other relevant factors; provided, however, that
Base Rent shall in no event be less than the Base Rent which
was in effect immediately prior to the date of commencement of
the Renewal Term, nor greater than Four Dollars ($4.00) per
square foot per month. Within thirty (30) days following
receipt of Tenant's Notice, Landlord shall give to Tenant
written notice of Landlord's estimation of Prevailing Market
Rate. If Tenant shall not agree with such estimation of
Prevailing Market Rate, Landlord and Tenant shall negotiate in
good faith to agree upon the Prevailing Market Rate on or
before one hundred twenty (120) days prior to commencement of
the Renewal Term. If Landlord and Tenant shall be unable to
agree upon the Prevailing Market Rate within such period of
time, Prevailing Market Rate shall be determined pursuant to
the arbitration procedure set forth in this Section 33. In the
event that such arbitration not have been concluded prior to
the date of commencement of the Renewal Term, Tenant shall
continue to pay as Base Rent hereunder, until the Prevailing
Market Rate has been determined by arbitration, the Base Rent
payable with respect to the month immediately preceding the
commencement of the Renewal Term. After the Prevailing Market
Rate has been determined by arbitration, then any adjustment
required to adjust the amount previously paid shall be made by
payment by Tenant to Landlord within ten (10) days after such
determination of the Prevailing Market Rate.
(b) In the event that Landlord and Tenant shall be unable to agree
upon Prevailing Market Rate within the period of time
specified in subparagraph (a) above, within ten (10) days
thereafter, each of the parties shall select a commercial real
estate broker from a recognized real estate brokerage firm
having offices in Oakland, California, who has at least five
(5) years' full-time commercial real estate brokerage
experience and who is familiar with the Prevailing Market Rate
of commercial office space in comparable office buildings in
Oakland, California, and shall give written notice of such
selection to the other party specifying therein the name and
address of the person to act as the arbitrator on such party's
behalf. If either party shall fail to notify the other party
of its appointment of a broker having such qualifications
within or by the time specified, then the broker appointed by
the other party shall make the sole determination of
Prevailing Market Rate of the Premises, and such determination
shall be binding upon the parties.
(c) The Prevailing Market Rate shall be determined by the two
brokers appointed by the parties in accordance with the
following procedures. Within thirty (30) days following the
appointment of the brokers by the parties, each of the brokers
shall state, in writing, his determination of the Prevailing
Market Rate supported by the reasons therefor and shall
provide copies to each party. If such determinations do not
differ by more than ten percent (10%), the
53
54
Prevailing Market Rate shall be the average of the two
determinations. If such determinations differ by more than ten
percent (10%) and the two brokers are subsequently unable to
agree upon the Prevailing Market Rate, the two brokers shall
appoint a third broker, who shall be a competent and impartial
person with qualifications similar to those required of the
first two brokers. If the two brokers are unable to agree upon
such appointment within ten (10) days following their
determinations of Prevailing Market Rate, then either Landlord
or Tenant, on behalf of both parties, may request appointment
of such a qualified person by the Presiding Judge of the San
Francisco County Superior Court acting in his individual
capacity. Following appointment of the third broker, he shall
promptly make his determination of Prevailing Market Rate in
the manner provided above, and the average of the three
determinations shall constitute the Prevailing Market Rate.
If, however, the low determination of Prevailing Market Rate
and/or the high determination of Prevailing Market Rate are
more than ten percent (10%) lower and/or higher than the
middle determination, any such low determination and/or high
determination shall be disregarded. If only one determination
is more than ten percent (10%) above or below the middle
determination, such that only one determination needs to be
disregarded, the remaining two determinations shall be added
together and their total divided by two; the resulting
quotient shall be the Prevailing Market Rate. If both the low
determination and the high determination are disregarded, then
the middle determination shall establish the Base Rent for the
Premises for the Renewal Term and shall be final and binding
upon the parties.
(d) In the event of a failure, refusal or inability of any broker
to act, his successor shall be appointed by him, but in the
case of the third broker, his successor shall be appointed in
the same manner as that set forth herein with respect to the
appointment of the original third broker. The brokers shall
make the final determination of Prevailing Market Rate not
later than sixty (60) days prior to the commencement of the
Renewal Term. Each party shall pay the fees and expenses of
its respective broker and both shall pay one-half (1/2) of the
fees and expenses of the third broker. Attorneys' fees and
expenses of counsel and of witnesses for the respective
parties shall be paid by the respective party engaging such
counsel or calling such witnesses.
34. FIRST RIGHT OF REFUSAL
Landlord shall grant to Tenant during the Initial Term of the Lease the
First Right Of Refusal on any full floor which may become available,
Tenant shall notify Landlord within five (5) business days of Tenants
intention to exercise Tenant's First Right of Refusal option.
35. THIRD FLOOR OCCUPANCY
Tenant shall have the right to occupy the third floor premises upon sixty
(60) days written notice to Landlord or by no later than November 1, 1999,
whichever is sooner.
54
55
(a) Term: The term of the Lease for occupancy of the third floor
premises shall start from the date Tenant takes occupancy and shall
terminate on the date the fourth floor premises terminates.
(b) Rent: The Rent for the third floor premises shall be in accordance
with Section 1.1 of the Lease. Rent increase dates for the third
floor premises shall coincide with the date the rent increase is
effective for the fourth floor premises.
36. SIGNAGE
If during Tenants occupancy in the Building, Tenant enters into leases for
six or more full floors, Tenant shall have the right to place a sign on
the exterior of the Building. Landlord shall approve the design, size,
type of installation, and the location of the sign in writing, prior to
installation of the sign. Tenant shall be responsible for all costs
associated with the installation, maintenance and removal of the sign,
including but not limited to any permits or government authorization
requirements.
Upon the expiration of Tenant's Lease, Tenant shall be responsible for all
costs associated with the removal of the sign and the repair of the
Building to its original condition. Said removal and repair shall be
approved by Landlord.
37. AIR CONDITIONING
Landlord has agreed to provide Tenant with air conditioning to the Third
and Fourth Floor Premises. All costs associated with the installation of
the air conditioning units shall be split equally between Landlord and
Tenant.
38. FIRST RIGHT OF NOTIFICATION
Landlord shall notify Tenant of Landlord's intention to sell The Central
Building. Tenant shall have five (5) business days to notify Landlord of
Tenant's interest in purchasing the Building.
39. SECURITY DEPOSIT AND LEASE GUARANTEE
On each anniversary date of the Lease during the Initial Term, Tenant with
prior written authorization from Landlord, shall reduce the obligation as
set forth in Section 1.8 and Section 1.16 of the Lease, by twenty
percent (20%) per year, provided Tenant has not been in default during
each twelve month period prior to each anniversary date. (Sample: On the
anniversary date of the first year if the Commencement Date of the Lease
was May 1, 1999, then on May 1, 2000 Tenants Security Deposit shall be
reduced by twenty percent (20%), $36,000.00 less $7,200.00 = $28,800.
Tenant's Letter of Credit shall be reduced by twenty percent (20%),
$200,000 less $40,000 = $160,000.00). Upon approval from Landlord,
Landlord will issue Tenant a check for each security deposit refund.
55
