EXHIBIT 10.12
CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.
AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION
STANDARD INDUSTRIAL/COMMERCIAL SINGLE-TENANT LEASE--NET
(Do not use this form for Multi-Tenant Buildings)
1. Basic Provisions ("Basic Provisions")
1.1 Parties: This Lease ("Lease"), dated for reference purposes only June
10, 1999, is made by and between XXXX VENTURES II, INC,. a California
corporation ("Lessor") and EQUINIX, INC., a California corporation ("Lessee"),
(collectively the "Parties," or individually a "Party").
1.2 Premises: That certain real property, including all improvements
therein or to be provided by Lessor under the terms of this Lease, and commonly
known as [*], San Xxxx, located in the County of Santa Xxxxx, State of
California and generally described as (describe briefly the nature of the
property and, if applicable, the "Project", if the property is located within a
Project) an industrial/office building of approximately [*] square feet of
rentable floor space and land on which same is located, more particularly
described in Exhibit "A" hereto, ("Premises"). (See also Paragraph 2 for further
provisions.)
1.3 Term: eleven (11) years and six (6) months ("Original Term") commencing
[*] ("Commencement Date"), and ending February 28, 2000 ("Expiration Date").
(See also Paragraph 3.)
1.4 Early Possession: Upon execution hereof ("Early Possession Date")
(See also Paragraphs 3.2 and 3.3.)
1.5 Base Rent: $[*] per month ("Base Rent"), payable on the first (1st) day
of each month commencing on the Commencement Date continuing for 6 months. (See
also Paragraph 4.)
[X] If this box is checked, there are provisions in this Lease for the Base
Rent to be adjusted. See also Paragraph 1 of Addendum.
1.6 Base Rent Paid Upon Execution: $______________________________________
as Base Rent for the period ___________________________________________________.
1.7 Security Deposit: See Paragraph 2 of Addendum ("Security Deposit").
(See Paragraph 5.)
1.8 Agreed Use: See Paragraph 5 of Addendum. (See also Paragraph 6.)
1.9 Insuring Party: Lessor is the "Insuring Party" unless otherwise
stated herein. (See also Paragraph 8.)
1.10 Real Estate Brokers: (See also Paragraph 15).
(a) Representation: The following real estate brokers (collectively,
the "Brokers") and brokerage relationships exist in this transaction (check
appropriate boxes):
[_] __________________________________________________ represents Lessor
exclusively ("Lessor's Broker");
[X] Commercial Properties Services Company (CPS) represents Lessee exclusively
("Lessor's Broker"); or
[X] __________________________________________________ represents both Lessor
and Lessee ("Dual Agency").
(b) Payment to Brokers: Upon execution and delivery of this Lease by
both Parties, Lessor shall pay to the Broker the fee agreed to in their separate
written agreement.
1.11 Guarantor. The obligations of the Lessee under this Lease are to be
guaranteed by N/A ("Guarantor"). (See also Paragraph 37)
1.12 Addenda and Exhibits. Attached hereto is an Addendum or Addenda
consisting of Paragraphs ___ through ___ and Exhibit _________________________
_______________, all of which constitute a part of this Lease.
2. Premises.
2.1 Letting. Lessor hereby leases to Lessee, and Lessee hereby leases from
Lessor, the Premises, for the term, at the rental, and upon all of the terms,
covenants and conditions set forth in this Lease. Unless otherwise provided
herein, any statement of size set forth in this Lease, or that may have been
used in calculating rental, is an approximation which the Parties agree is
reasonable and the rental based thereon is not subject to revision whether or
not the actual size is more or less.
2.2 Condition. Lessor shall deliver the Premises to Lessee broom clean and
free of debris on the Commencement Date or the Early Possession Date, whichever
first occurs first ("Start Date"). Landlord warrants that the structural
elements of the roof, bearing walls and foundation of any buildings on the
Premises (the "Building") shall be free of material defects. If a non-compliance
with said warranty exists as of the Start Date, Lessor shall, as Lessor's sole
obligation with respect to such matter, except as otherwise provided in this
Lease, promptly after receipt of written notice from Lessee setting forth with
specificity the nature and extent of such non-compliance, rectify same at
Lessor's expense. If, after the Start Date, Lessee does not give Lessor written
notice of any non-compliance with this warranty within: (i) one year as to the
surface of the roof and the structural portions of the roof, foundations and
bearing walls, correction of that non-compliance shall be the obligation of
Lessee at Lessee's sole cost and expense. See "AS IS" Provision in Paragraph 3
of Addendum.
2.3 Compliance. As used in this Lease, "Applicable Requirements" means all
applicable laws, covenants, or restrictions of record, building codes,
regulations and ordinances in effect on the Start Date.
2.4 Acknowledgements. Lessee acknowledges that: (a) it has been advised
by Lessor and/or Brokers to satisfy itself with respect to the condition of the
Premises (including but not limited to the electrical, HVAC and fire sprinkler
systems, security, environmental aspects, and compliance with Applicable
Requirements), and their suitability for Lessee's intended use, (b) Lessee has
made such investigation as it deems necessary with reference to such matters and
assumes all responsibility therefor as the same relate to its occupancy of the
Premises, and (c) neither Lessor, Lessor's agents, nor any Broker has made any
oral or written representations or warrants with respect to said matters other
than as set forth in this Lease. In addition, Lessor acknowledges that: (a)
Broker has made no representations, promises or warranties concerning Lessee's
ability to honor the Lease or suitability to occupy the Premises, and (b) it is
Lessor's sole responsibility to investigate the financial capability and/or
suitability of all proposed tenants.
3. Term.
3.1 Term. The Commencement Date, Expiration Date and Original Term of
this Lease are as specified in Paragraph 1.3.
3.2 Early Possession. If Lessee totally or partially occupies the
Premises prior to the Commencement Date, the obligation to pay Base Rent shall
be abated for the period of such early possession. All other terms of this
Lease, however, (including but not limited to the obligations to pay Real
Property Taxes and insurance premiums and to maintain the Premises) shall be in
effect during such period. Any such early possession shall not affect the
Expiration Date.
_________________
*CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
3.3 Delay in Possession. Lessor agrees to use its best commercially
reasonable efforts to deliver possession of the Premises to Lessee by the
Execution Date. If, despite said efforts, Lessor is unable to deliver possession
as agreed, Lessee shall not be subject to any liability therefor, nor shall such
failure affect the validity of this Lease. Lessee shall not, however, be
obligated to pay Rent or perform its other obligations until it receives
possession of the Premises. If possession is not delivered within sixty (60)
days after the Execution Date, Lessee may, at its option, by notice in writing
to Lessor within ten (10) days after the end of such sixty (60) day period,
cancel this Lease, in which event the Parties shall be discharged from all
obligations hereunder. If such written notice is not received by Lessor within
said ten (10) day period, Lessee's right to cancel shall terminate. Except as
otherwise provided, if possession is not tendered to Lessee by the Start Date
and Lessee does not terminate this Lease, as aforesaid, any period of rent
abatement that Lessee would otherwise have enjoyed shall run from the date of
delivery of possession and continue for a period equal to what Lessee would
otherwise have enjoyed under the terms hereof, but minus any days of delay
caused by the acts or omissions of Lessee. If possession of the Premises is not
delivered within four (4) months after the Execution Date, this Lease shall
terminate unless other agreements are reached between Lessor and Lessee, in
writing.
3.4 Lessee Compliance. Lessor shall not be required to tender possession
of the Premises to Lessee until Lessee complies with its obligation to provide
evidence of insurance (Paragraph 8.5). Pending delivery of such evidence, Lessee
shall be required to perform all of its obligations under this Lease from and
after the Commencement Date, including the payment of Rent, notwithstanding
Lessor's election to withhold possession pending receipt of such receipt of such
evidence of insurance. Further, if Lessee is required to perform any other
conditions prior to or concurrent with the Start Date, the Start Date shall
occur but Lessor may elect to withhold possession until such conditions are
satisfied.
4. Rent.
4.1 Rent Defined. All monetary obligations of Lessee to Lessor under the
terms of this Lease (except for the Security Deposit) are deemed to be rent
("Rent").
4.2 Payment. Lessee shall cause payment of Rent to be received by Lessor
in lawful money of the United States, without offset or deduction (except as
specifically permitted in this Lease), on or before the day on which it is due.
Rent for any period during the term hereof which is for less than one (1) full
calendar month shall be prorated based upon the actual number of days of said
month. Payment of Rent shall be made to Lessor at its address stated herein or
to such other persons or place as Lessor may from time to time designate in
writing. Acceptance of payment which is less than the amount then due shall not
be a waiver of Lessor's rights to the balance of such Rent, regardless of
Lessor's endorsement of any check so stating.
5. Security Deposit. Lessee shall deposit with Lessor upon execution hereof
the Security Deposit as security for Lessee's faithful performance of Lessee's
obligations under this Lease. If Lessee fails to pay Rent after any applicable
cure period, or otherwise Breaches under this Lease, Lessor may use, apply or
retain all or any portion of said Security Deposit for the payment of any amount
due Lessor or to reimburse or compensate Lessor for any liability, expense, loss
or damage which Lessor may suffer or incur by reason thereof. If Lessor uses or
applies all or any portion of said Security Deposit, Lessee shall within ten
(10) days after written request therefor deposit monies with Lessor sufficient
to restore said Security Deposit to the full amount required by this Lease.
Should the Agreed Use be amended to accommodate a material change in the
business of Lessee or to accommodate a sublessee or assignee, Lessor shall have
the right to increase the Security Deposit to the extent necessary, in Lessor's
reasonable judgment, to account for any increased wear and tear that the
Premises may suffer as a result thereof. Lessor shall not be required to keep
the Security Deposit separate from its general accounts. Within fourteen (14)
days after the expiration or termination of this Lease, if Lessor elects to
apply the Security Deposit only to unpaid Rent, and otherwise within thirty (30)
days after the Premises have been vacated pursuant to Paragraph 7.4(c) below,
Lessor shall return to that portion of the Security Deposit not used or applied
by Lessor. No part of the Security Deposit shall be considered to be held in
trust, to bear interest or to be prepayment for any monies to be paid by Lessee
under this Lease.
6. Use.
6.1 Use. Lessee shall use and occupy the Premises only for the Agreed
Use, or any other legal use which is reasonably comparable thereto, and for no
other purpose. Lessee shall not use or permit the use of the Premises in a
manner that is unlawful, creates damage, waste or a nuisance, or that disturbs
owners and/or occupants of, or causes damage to neighboring properties. Lessor
shall not unreasonably withhold or delay its consent to any written request for
a modification of the Agreed Use, so long as the same will not impair the
structural integrity of the improvements on the Premises or the mechanical or
electrical systems therein, is not significantly more burdensome to the
Premises. If Lessor elects to withhold consent, Lessor shall within five (5)
business days after such request give written notification of same, which notice
shall include an explanation of Lessor's objections to the change in use. See
Paragraph 5, Addendum)
6.2 Hazardous Substances.
(a) Reportable Uses Require Consent. The term "Hazardous Substance"
as used in this Lease shall mean any product, substance, or waste whose
presence, use, manufacture, disposal, transportation, or release, either by
itself or in combination with other materials expected to be on the Premises, is
either: (i) potentially injurious to the public health, safety or welfare, the
environment or the Premises, (ii) regulated or monitored by any governmental
authority, or (iii) a basis for potential liability of Lessor to any
governmental agency or third party under any applicable statute or common law
theory. Hazardous Substance shall include, but not be limited to, hydrocarbons,
petroleum, gasoline, and/or crude oil or any products, by-products or fractions
thereof. Lessee shall not engage in any activity in or on the Premises which
constitutes a Reportable Use of Hazardous Substances without the express prior
written consent of Lessor and timely compliance (at Lessee's expense) with all
Applicable Requirements. "Reportable Use" shall mean (i) the installation or use
of any above or below ground storage tank, (ii) the generation, possession,
storage, use, transportation, or disposal of a Hazardous Substance that requires
a permit from, or with respect to which a report, notice, registration or
business plan is required to be filed with, any governmental authority, and/or
(iii) the presence at the Premises of a Hazardous Substance with respect to
which any Applicable Requirements requires that a notice be given to persons
entering or occupying the Premises or neighboring properties. Notwithstanding
the foregoing, Lessee may use any ordinary and customary materials reasonably
required to be used by Lessee in the normal course of the Agreed Use, so long as
such use is in compliance with all Applicable Requirements, is not a Reportable
Use, and does not expose the Premises or neighboring properties to any
meaningful risk of contamination or damage or expose Lessor to any liability
therefor. In addition, Lessor may condition its consent to any Reportable Use
upon receiving such additional assurances as Lessor reasonably deems necessary
to protect itself, the public, the Premises and/or the environment against
damage, contamination or injury and/or liability, including, but not limited to,
the installation (and removal on or before Lease expiration or earlier
termination) of protective modifications and/or increasing the Security Deposit.
(b) Duty to Inform Lessor. If Lessee knows, or has reasonable cause
to believe, that a Hazardous Substance has come to be located in, on, under or
about the Premises, other than as previously consented to by Lessor, Lessee
shall immediately give written notice of such fact to Lessor, and provide Lessor
with a copy of any report, notice, claim or other documentation which is has
concerning the presence of such Hazardous Substance.
(c) Lessee Remediation. Lessee shall not cause or permit any
Hazardous Substance to be spilled or released in, on, under, or about the
Premises (including through the plumbing or sanitary sewer system) and shall
promptly, at Lessee's expense, take all investigatory and/or remedial action
reasonably recommended, whether or not formally ordered or required, for the
cleanup of any contamination of, and for the maintenance, security and/or
monitoring of the Premises or neighboring properties, that was caused or
materially contributed to by Lessee, or pertaining to or involving any Hazardous
Substance brought onto the Premises during the term of this Lease, by or for
Lessee, or any third party.
(d) Lessee Indemnification. Lessee shall indemnify, defend and hold
Lessor, its agents, employees, lenders and ground lessor, if any, harmless from
and against any and all loss of rents and/or damages, liabilities, judgments,
claims, expenses, penalties, permits and attorney's and consultant's fees
arising out of or involving any Hazardous Substance brought onto the Premises by
or for Lessee, or any third party (provided however, that Lessee shall have no
liability under this Lease with respect to underground migration of any
Hazardous Substance under the Premises from adjacent properties). Lessee's
obligations shall include, but not be limited to, the effects of any
contamination or injury to person, property or the environment created or
suffered by Lessee, and the cost of investigation, removal, remediation,
restoration and/or abatement, and shall survive the expiration or earlier
termination of this Lease. No termination, cancellation or release agreement
entered into by Lessor and Lessee shall release Lessee from its obligations
under this Lease with respect to Hazardous Substances, unless specifically so
agreed by Lessor in writing at the time of such_agreement.
(e) Lessor Indemnification. Lessor and its successors and assigns
shall indemnify, defend, reimburse and hold Lessee, its employees and lenders,
harmless from and against any and all environmental damages, including the cost
of remediation, which existed as a result of Hazardous Substances on the
Premises prior to the Start Date or which are caused by the negligence or
willful misconduct of Lessor, its agents or employees. Lessor's obligations, as
and when required by the Applicable Requirements, shall include, but not be
limited to, the cost of investigation, removal, remediation, restoration and/or
abatement, and shall survive the expiration or termination of this Lease.
(f) Investigations and Remediations. Lessor shall retain the
responsibility and pay for any investigations or remediation measures required
by governmental entitles having jurisdictions with respect to the existence of
Hazardous Substances on the Premises prior to the Start Date, unless such
remediation measure is required as a result of Lessee's use (including
"Alterations", as defined in paragraph 7.3(a) below) of the Premises,
in which event Lessee shall be responsible for such payment. Lessee shall
cooperate fully in any such activities at the request of Lessor, including
allowing Lessor and Lessor's agents to have reasonable access to the Premises at
reasonable times in order to carry out Lessor's Investigative and remedial
responsibilities.
(g) Lessor Termination Option. If a Hazardous Substance Condition
occurs during the term of this Lease, unless Lessee is legally responsible
therefor (in which case Lessee shall make the investigation and remediation
thereof required by the Applicable Requirements and this Lease shall continue in
full force and effect, but subject to Lessor's rights under Paragraph 6.2(d) and
Paragraph 13). Lessor may, at Lessor's option, either (i) investigate and
remediate such Hazardous Substance Condition, if required, as soon as reasonably
possible at Lessor's expense in which event this Lease shall continue in full
force and effect, or (ii) if the estimated cost to remediate such condition
exceeds $2,000,000.00 given written notice to Lessee, within thirty (30) days
after receipt by Lessor of knowledge of the occurrence of such Hazardous
Substance Condition, of Lessor's desire to terminate this Lease as of the date
sixty (60) days following the date of such notice. In the event Lessor elects to
give a termination notice, Lessee may, within ten (10) days thereafter, give
written notice to Lessor of Lessee's commitment to pay the amount by which the
cost of the remediation of such Hazardous Substance Condition $2,000,000.00.
Lessee shall provide Lessor with said funds or satisfactory assurance thereof
within thirty (30) days following such commitment. In such event, this Lease
shall continue in full force and effect, and Lessor shall proceed to make such
remediation as soon as reasonably possible after the required funds are
available. If Lessee does not give such notice and provide the required funds or
assurance thereof within the time provided, this Lease shall terminate as of the
date specified in Lessor's notice of termination.
6.3 Lessee's Compliance with Applicable Requirements. Except as otherwise
provided in this Lease, Lessee, shall, at Lessee's sole expense, fully,
diligently and in a timely manner, materially comply with all Applicable
Requirements, the requirements of any applicable fire insurance underwriter or
rating bureau, and the reasonable recommendations of Lessor's engineers and/or
consultants which relate in any manner to the Premises, without regard to
whether said requirements are now in effect or become effective after the Start
Date. Lessee shall, within ten (10) days after receipt of Lessor's written
request, provide Lessor with copies of all permits and other documents, and
other information evidencing Lessee's compliance with any Applicable
Requirements specified by Lessor, and shall immediately upon receipt, notify
Lessor in writing (with copies of any documents involved) of any threatened or
actual claim, notice, citation, warning, complaint or report pertaining to or
involving failure of Lessee or the Premises to comply with any Applicable Law.
6.4 Inspection; Compliance. Lessor and Lessor's "Lender" (as defined in
Paragraph 30 below) and consultants shall have the right to enter into Premises
at any time, in the case of an emergency, and otherwise at reasonable times, for
the purpose of inspecting the condition of the Premises and for verifying
compliance by Lessee with this Lease. The cost of any inspections shall be paid
by Lessor, unless a violation of Applicable Requirements, or a contamination is
found to exist or be imminent, or the inspection is requested or ordered by a
governmental authority. In such case, Lessee shall upon request reimburse
Lessor for the cost of such inspections, so long as such inspection is
reasonably related to the violation or contamination. Notwithstanding the
foregoing, Lessor shall not be allowed to enter the Premises without providing
Lessee with at least twenty-four (24) hours prior notice and being escorted by
one or Lessee's representatives, except in case of an emergency.
7. Maintenance; Repairs; Utility Installations; Trade Fixtures and
Alterations.
7.1 Lessee's Obligations.
(a) In General. Subject to the provisions of Paragraph 2.2
(Condition), 6.3 (Lessor's Compliance with Applicable Requirements), 7.2
(Lessor's Obligations), 9 (Damage and Destruction), and 14 (Condemnation),
Lessee shall, at Lessee's sole cost and expense, keep the Premises, Utility
Installations, and Alterations in good order, condition and repair (whether or
not such portion of the Premises requiring repairs, or the means of repairing
the same, are reasonably or readily accessible to Lessee, and whether or not the
need for such repairs occurs as a result of Lessee's use, any prior use, the
elements or the age of such portion of the Premises), including, but not limited
to, all equipment or facilities, such as plumbing, heating, air conditioning,
electrical, lighting facilities, boilers, pressure vessels, fire protection
system, fixtures, walls (interior and exterior), foundations, ceilings, roofs,
floors, windows, doors, plate glass, skylights, landscaping, driveways, parking
lots, fences, retaining walls, signs, sidewalks and parkways located in, on,
about, or adjacent to the Premises. Lessee, in keeping the Premises in good
order, condition and repair, shall exercise and perform good maintenance
practices, specifically including the procurement and maintenance of the service
contracts required by Paragraph 7.1(b) below. Lessee's obligations shall include
restorations, replacements or renewals when necessary to keep the Premises and
all improvements thereon or a part thereof in good order, condition and state of
repair. Lessee shall, during the term of this Lease, keep the exterior
appearance of the Building in a first-class condition consistent with the
exterior appearance of other similar facilities of comparable age and size in
the vicinity, including, when necessary, the exterior repainting of the
Building.
(b) Service Contracts. Lessee shall, at Lessee's sole cost and
expense, procure and maintain contracts, with copies to Lessor, in customary
form and substance for, and with contractors specializing and experienced in the
maintenance of the following equipment and improvements, if any, if and when
installed on the Premises: (i) HVAC equipment, (ii) fire sprinkler systems,
including fire alarm and/or smoke detection, (iii) landscaping and irrigation
systems, (iv) roof covering and drains, (v) driveways and parking lots, (vi)
basic utility feed to the perimeter of the Building, if reasonably required by
Lessor.
7.2 Lessor's Obligations. Subject to the provisions of Paragraphs 2.2
(Condition), 9 (Damage or Destruction) and 14 (Condemnation), it is intended by
the Parties hereto that Lessor have no obligation, in any manner whatsoever, to
repair and maintain the Premises, or the equipment therein, all of which
obligations are intended to be that of the Lessee. It is the intention of the
Parties that the terms of this Lease govern the respective obligations of the
Parties as to maintenance and repair of the Premises and they expressly waive
the benefit of any statute now or hereafter in effect to the extent it is
inconsistent with the terms of this Lease.
7.3 Utility Installations; Trade Fixtures; Alterations.
(a) Definitions; Consent Required. The term "Utility Installations"
refers to all floor and window coverings, air lines, power panels, electrical
distribution, security, fire protection systems, communication systems, lighting
fixtures, HVAC equipment, plumbing, and fencing in or on the Premises. The term
"Trade Fixtures" shall mean Lessee's machinery and equipment that can be removed
without doing material damage to the Premises. The term "Alterations" shall mean
any modification of the improvements, other than Utility Installations or Trade
Fixtures, whether by addition or deletion. "Lessee Owned Alterations and/or
Utility Installations" are defined as Alterations and/or Utility Installations
made by Lessee that are not yet owned by Lessor pursuant to Paragraph 7.4(a).
Lessee shall not make any Alterations or Utility Installations to the Premises
without Lessor's prior written consent. Lessee may, however, make non-structural
Utility Installations to the interior of the Premises (excluding the roof),
without such consent but not upon notice to Lessor, as long as they are not
visible from the outside, do not involve puncturing, relocating or removing the
roof or any existing walls, and the cumulative cost thereof during the term of
this Lease as extended does not exceed $50,000 in the aggregate or $10,000 in
any one year. See Paragraph 4 Addendum.
(b) Consent. Any Alterations or Utility Installations that Lessee
shall desire to make and which require the consent of the Lessor shall be
presented to Lessor in written form with detailed plans. Consents shall be
deemed conditioned upon Lessee's: (i) acquiring all applicable governmental
permits, (ii) furnishing Lessor with copies of both the permits and the plans
and specifications prior to commencement of the work, and (iii) compliance with
all conditions of said permits and other Applicable Requirements in a prompt and
expeditious manner. Any Alterations or Utility Installations shall be performed
in a workmanlike manner with good and sufficient materials. Lessee shall
promptly upon completion furnish Lessor with as-built plans and specifications.
For work which costs an amount equal to the quarter of one month's Base Rent, or
$10,000, Lessor may condition its consent upon Lessee providing a lien and
completion bond in an amount equal to one and one-half times the estimated cost
of such Alteration or Utility Installation and/or upon Lessee's posting an
additional Security Deposit with Lessor. See Paragraph 4 Addendum.
(c) Indemnification. Lessee shall pay, when due, all claims for
labor or materials furnished or alleged to have been furnished to or for Lessee
at or for use on the Premises, which claims are or may be secured by any
mechanics' or materialmen's lien against the Premises or any interest therein.
Lessee shall give Lessor not less than ten (10) days' notice prior to the
commencement of any work in, on or about the Premises, and Lessor shall have the
right to post notices of non-responsibility. If Lessee shall contest the
validity of any such lien, claim or demand, then Lessee shall, at its sole
expense defend and protect itself, Lessor and the Premises against the same and
shall pay and satisfy any such adverse judgment that may be rendered thereon
before the enforcement thereof. If Lessor shall require, Lessee shall furnish a
surety bond in an amount equal to one and one-half times the amount of such
contested lien, claim or demand, indemnifying Lessor against liability for the
same. In Lessor elects to participate in any such action, Lessee shall pay
Lessor's attorneys' fees and costs.
7.4 Ownership; Removal; Surrender; and Restoration.
(a) Ownership. Subject to Lessor's right to require removal or elect
ownership as hereinafter provided, all Alterations and Utility Installations
made by Lessee shall be the property of Lessee, but considered a part of the
Premises. Lessor may, at any time, elect in writing to be owner of all or any
specified part of the Lessee Owned Alterations, and Utility Installations.
Unless otherwise instructed per Paragraph 7.4(b) hereof, all Lessee Owned
Alterations and Utility Installations shall, at the expiration or earlier
termination of this Lease, become the property of Lessor and be surrendered by
Lessee with the Premises. See Paragraph 4 of Addendum.
(b) Removal. By delivery to Lessee of written notice from Lessor not
earlier than ninety (90) and not later than thirty (30) days prior to the end of
the term of this Lease. Lessor may require that any or all Lessee Owned
Alterations or Utility Installations be removed by the expiration or
PAGE 3
termination of this Lease. Lessor may require the removal at any time of all or
any part of any Lessee Owned Alterations or Utility Installations made without
the required consent. See Paragraph 4 of Addendum.
(c) Surrender/Restoration. Lessee shall surrender the Premises by
the Expiration Date or any earlier termination date, with all of the
improvements, parts and surfaces thereof broom clean and free of debris, and in
good operating order, condition and state of repair, ordinary wear and tear,
casualty, condemnation, and damage attributable to the willful misconduct or
negligence of Lessor, its agents, employees and contractors, and damage
attributable to Lessor's default hereunder excepted. "Ordinary wear and tear"
shall not include any damage or deterioration that would have been prevented by
good maintenance practice. Lessee shall repair any damage occasioned by the
installation, maintenance or removal of Trade Fixtures, Lessee Owned Alterations
and/or Utility Installations, furnishings, and equipment as well as the removal
of any storage tank installed by or for Lessee, and the removal, replacement, or
remediation of any soil, material or groundwater contaminated by Lessee. Trade
Fixtures shall remain the property of Lessee and shall be removed by Lessee. The
failure by Lessee to timely vacate the Premises pursuant to this Paragraph
7.4(c) without the express written consent of Lessor shall constitute a holdover
under the provisions of Paragraph 26 below.
8. Insurance; Indemnity.
8.1 Payment For Insurance. Lessee shall pay for all insurance required
under Paragraph 8. Premiums for policy periods commencing prior to or extending
beyond the Lease term shall be prorated to correspond to the Lease term. Payment
shall be made by Lessee to Lessor within ten (10) days following receipt of an
invoice.
8.2 Liability Insurance.
(a) Carried by Lessee. Lessee shall obtain and keep in force a
Commercial General Liability policy of insurance protecting Lessee and Lessor
against claims for bodily injury, personal injury and property damage based upon
or arising out of the ownership, use, occupancy or maintenance of the Premises
and all areas appurtenant thereto. Such insurance shall be on an occurrence
basis providing single limit coverage in an amount not less than $2,000,000 per
occurrence with an "Additional Insured-Managers or Lessors of Premises
Endorsement" and contain the "Amendment of the Pollution Exclusion Endorsement"
for damage caused by heat, smoke or fumes from a hostile fire. The policy shall
not contain any intra-insured exclusions as between insured persons or
organizations, but shall include coverage for liability assumed under this Lease
as an "insured contract" for the performance of Lessee's indemnity obligations
under this Lease. The limits of said insurance shall not, however, limit the
liability of Lessee nor relieve Lessee of any obligation hereunder. All
insurance to be carried by Lessee shall be primary to and not contributory with
any similar insurance carried by Lessor, whose insurance shall be considered
excess insurance only.
8.3 Property Insurance-Building, Improvements and Rental Value.
(a) Building and Improvements. The Insuring Party shall obtain and
keep in force a policy or policies in the name of Lessor, with loss payable to
Lessor, any groundlessor, and to any Lender(s) insuring loss or damage to the
Premises. The amount of such insurance shall be equal to the full replacement
cost of the Premises, as the same shall exist from time to time, but not less
than the amount required by Lenders, but in no event more than the commercially
reasonable and available insurable value thereof. If Lessor is the Insuring
Party, however, Lessee Owned Alterations and Utility Installations, Trade
Fixtures, and Lessee's personal property shall be insured by Lessee under
Paragraph 8.4 rather than by Lessor. If the coverage is available and
commercially appropriate, such policy or policies shall insure against all risks
of direct physical loss or damage the perils of flood and/or earthquake, if
desired by Lessor, including coverage for debris removal and the enforcement of
any Applicable Requirements requiring the upgrading, demolition, reconstruction
or replacement of any portion of the Premises as the result of a covered of
loss. Said policy or policies shall also contain an agreed valuation provision
in lieu of any coinsurance clause, waiver of subrogation, and inflation guard
protection causing an increase in the annual property insurance coverage amount
by a factor of not less than the adjusted U.S. Department of Labor Consumer
Price Index for All Urban Consumers for the city nearest to where the Premises
are located. If such insurance coverage has a deductible clause, the deductible
amount shall not exceed $1,000 per occurrence, and Lessee shall be liable for
such deductible amount in the event of an Insured Loss. Lessor shall use
insurance proceeds as necessary, to rebuild the Premises, unless this Lease is
terminated pursuant to Paragraph 9 hereof.
(b) Rental Value. The Insuring Party shall obtain and keep in force
a policy or policies in the name of Lessor, with loss payable to Lessor and
Lender, insuring the loss of the full Rent for one (1) year. Said insurance
shall provide that in the event the Lease is terminated by reason of an insured
loss, the period of indemnity for such coverage shall be extended beyond the
date of the completion of repairs or replacement of the Premises, to provide for
one full year's loss of Rent from the date of any such loss. Said insurance
shall contain an agreed valuation provision in lieu of any coinsurance clause,
and the amount of coverage shall be adjusted annually to reflect the projected
Rent otherwise payable by Lessee, for the next twelve (12) month period. Lessee
shall be liable for any deductible amount in the event of such loss.
8.4 Lessee's Property/Business Interruption Insurance. ** subject to its
Lender's rights therein and as Lessee otherwise elects.
(a) Property Damage. Lessee shall obtain and maintain insurance
coverage on all of Lessee's personal property, Trade Fixtures, and Lessee Owned
Alterations and Utility Installations. Such insurance shall be full replacement
cost coverage with a deductible of not to exceed $25,000 per occurrence. The
proceeds from any such insurance shall be used by Lessee** for the replacement
of personal property, Trade Fixtures and Lessee Owned Alterations and Utility
Installations. Lessee shall provide Lessor with written evidence that such
insurance is in force.
(b) Business Interruption. Lessee shall obtain and maintain loss of
income and extra expense insurance in amounts as will reimburse Lessee for
direct or indirect loss of earnings attributable to all perils commonly insured
against by prudent lessees in the business of Lessee or attributable to
prevention of access to the Premises as a result of such perils.
(c) No Representation of Adequate Coverage. Lessor makes no
representation that the limits or forms of coverage of insurance specified
therein are adequate to cover Lessee's property, business operations or
obligations under this Lease.
8.5 Insurance Policies. Insurance required hereunder shall be in
companies duly licensed to transact business in the state where the Premises are
located, and maintaining during the policy term a "General Policyholders Rating"
of at least B+, V, as set forth in the most current issue of "Best's Insurance
Guide", or such other rating as may be required by a Lender. Lessee shall not do
or permit to be done anything which invalidates the required insurance policies.
Lessee shall, prior to the Start Date, deliver to Lessor certified copies of
policies of such insurance or certificates evidencing the existence and amounts
of the required insurance. No such policy shall be cancelable or subject to
modification except after thirty (30) days prior written notice to Lessor.
Lessee shall, at least thirty (30) days prior to the expiration of such
policies, furnish Lessor with evidence of renewals or "insurance binders"
evidencing renewal thereof, or Lessor may order such insurance and charge the
cost thereof to Lessee, which amount shall be payable by Lessee to Lessor upon
demand. Such policies shall be for a term of at least one year, or the length of
the remaining term of this Lease, whichever is less. If either Party shall fail
to procure and maintain the insurance required to be carried by it, the other
Party may, but shall not be required to, procure and maintain the same.
8.6 Waiver of Subrogation. Without affecting any other rights or remedies,
Lessee and Lessor each hereby release and relieve the other, and waive their
entire right to recover damages against the other, for loss of or damage to its
property arising out of or incident to the perils required to be insured against
herein. The effect of such releases and waivers is not be limited by the amount
of insurance carried or required, or by any deductibles applicable thereto. The
Parties agree to have their respective property damage insurance carriers waive
any right to subrogation that such companies may have against Lessor or Lessee,
as the case may be, so long as the insurance is not invalidated thereby.
8.7 Indemnity. Except for Lessor's gross negligence or willful
misconduct, Lessee shall indemnity, protect, defend and hold harmless the
Premises, Lessor and its agents, Lessor's master or ground lessor, partners and
Lenders, from and against any and all claims, loss of rents and/or damages,
liens, judgments, penalties, permits, attorney's and consultant's fees, expenses
and/or liabilities arising out of, involving, or in connection with, the use
and/or occupancy of the Premises by Lessee. If any action or proceeding is
brought against Lessor by reason of any of the foregoing matters, Lessee shall
upon notice defend the same at Lessee's expense by counsel reasonably
satisfactory to Lessor and Lessor shall cooperate with Lessee in such defense.
Lessor need not have first paid any such claim in order to be defended or
indemnified.
8.8 Exemption of Lessor from Liability. Lessor shall not be liable for
injury or damage to the person or goods, wares, merchandise or other property of
Lessee, Lessee's employees, contractors, invitees, customers, or any other
person in or about the Premises, whether such damage or injury is caused by or
results from fire, steam, electricity, gas, water or rain, or from the breakage,
leakage, obstruction or other defects of pipes, tire sprinklers, wires,
appliances, plumbing, HVAC or lighting fixtures, or from any other cause,
weather the said injury or damage results from conditions arising upon the
Premises or upon other portions of the Building of which the Premises are a
part, or from other sources or places. Lessor shall not be liable for any
damages arising from any act or neglect of any other tenant of Lessor.
Notwithstanding Lessor's negligence or breach of this Lease, Lessor shall under
no circumstances be liable for injury of Lessee's business or for any loss of
income or profit therefrom.
9. Damage or Destruction.
9.1 Definitions.
(a) "Premises Partial Damage" shall mean damage or destruction to the
improvements on the Premises, other than Lessee Owned Alterations and Utility
Installations, which can reasonably be repaired in six (6) months or less from
the date of the of the damage or destruction. Lessor shall notify Lessee in
writing within thirty (30) days from the date of the damage or destruction as to
whether or not the damage is Partial or Total.
PAGE 4
(b) "Premises Total Destruction" shall mean damage or destruction to
the Premises, other than Lessee Owned Alterations and Utility Installations and
Trade Fixtures, which cannot reasonably be repaired in six (6) months or less
from the date of the damage or destruction. Lessor shall notify Lessee in
writing within thirty (30) days from the date of the damage or destruction as to
whether or not the damage is Partial or Total.
(c) "Insured Loss" shall mean damage or destruction to improvements
on the Premises, other than Lessee Owned Alterations and Utility Installations
and Trade Fixtures, which was caused by an event required to be covered by the
insurance described in Paragraph 8.3(a), irrespective of any deductible amounts
or coverage limits Involved.
(d) "Replacement Cost" shall mean the cost to repair or rebuild the
improvements owned by Lessor at the time of the occurrence to their condition
existing immediately prior thereto, including demolition, debris removal and
upgrading required by the operation of Applicable building codes, ordinances or
laws, and without deduction for depreciation.
(e) "Hazardous Substance Condition" shall mean the occurrence or
discovery of a condition involving the presence of, or a contamination by, a
Hazardous Substance as defined in Paragraph 6.2(a), in, on, or under the
Premises.
9.2 Partial Damage-Insured Loss. If a Premises Partial Damage that is an
Insured Loss occurs, then Lessor shall, at Lessor's expense, repair such damage
(but not Lessee's Trade Fixtures or Lessee Owned Alterations and Utility
Installations) as soon as reasonably possible and this Lease shall continue in
full force and effect; provided, however, that Lessee shall, at Lessor's
election, make the repair of any damage or destruction the total cost to repair
of which is $10,000 or less, and, in such event, Lessor shall make any
applicable insurance proceeds available to Lessee on a reasonable basis for that
purpose. Notwithstanding the foregoing, if the required insurance was not in
force or the insurance proceeds are not sufficient to effect such repair, the
Insuring Party shall promptly contribute the shortage in proceeds (except as to
the deductible which is Lessee's responsibility) as and when required to
complete said repairs. In the event, however, the shortage was due to the fact
that, by reason of the unique nature of the improvements, full replacement cost
insurance coverage was not commercially reasonable and available, Lessor shall
have no obligation to pay for the shortage in insurance proceeds or to fully
restore the unique aspects of the Premises unless Lessee provides Lessor with
the funds to cover same, or adequate assurance thereof, within ten (10) days
following receipt of written notice of such shortage and request therefore. If
Lessor receives said funds or adequate assurance thereof within said ten (10)
day period, the party responsible for making the repairs shall complete them as
soon as reasonably possible and this Lease shall remain in full force and
effect. If such funds or assurance are not received, Lessor may nevertheless
elect by written notice to Lessee within ten (10) days thereafter to: (i) make
such restoration and repair as is commercially reasonable with Lessor paying any
shortage in proceeds, in which case this Lease shall remain in full force and
effect, or have this Lease terminate thirty (30) days thereafter. Lessee shall
not be entitled to reimbursement of any funds contributed by Lessee to repair
any such damage or destruction. Premises Partial Damage due to flood or
earthquake shall be subject to Paragraph 9.3, notwithstanding that there may be
some insurance coverage, but the net proceeds of any such insurance shall be
made available for the repairs if made by either Party.
9.3 Partial Damage-Uninsured Loss. If a Premises Partial Damage that is
not an Insured Loss occurs, unless caused by a negligent or willful act of
Lessee (in which event Lessee shall make the repairs at Lessee's expense),
Lessor may either: (i) repair such damage as soon as reasonably possible at
Lessor's expense, in which event this Lease shall continue in full force and
effect, or (ii) terminate this Lease by giving written notice to Lessee within
thirty (30) days after receipt by Lessor of knowledge of the occurrence of such
damage. Such termination shall be effective sixty (60) days following the date
of such notice. In the event Lessor elects to terminate this Lease, Lessee shall
have the right within ten (10) days after the receipt of the termination notice
to give written notice to Lessor of Lessee's commitment to pay for the repair of
such damage without reimbursement from Lessor. Lessee shall provide Lessor with
said funds or satisfactory assurance thereof within thirty (30) days after
making such commitment. In such event this Lease shall continue in full force
and effect, and Lessor shall proceed to make such repairs as soon as reasonably
possible and the required funds are available. If Lessee does not make the
required commitment, this Lease shall terminate as of the date specified in the
termination notice.
9.4 Total Destruction. Notwithstanding any other provision hereof, if a
Premises Total Destruction occurs, this Lease shall terminate sixty (60) days
following the date of such Destruction. If the damage or destruction was caused
by the gross negligent or willful misconduct of Lessee, Lessor shall have the
right to recover Lessor's damages from Lessee, except as released and waived in
Paragraph 8.6.
9.5 Damage Near End of Term. If at any time during the last six (6)
months of this Lease there is damage for which the cost to repair exceeds one
(1) month's Base Rent, whether or not an Insured Loss, Lessor may terminate this
Lease effective sixty (60) days following the date of occurrence of such damage
by giving a written termination notice to Lessee within thirty (30) days after
the date of occurrence of such damage. Notwithstanding the foregoing, if Lessee
at that time has an exercisable option to extend this Lease or to purchase the
Premises, then Lessee may preserve this Lease by, (a) exercising such option and
(b) providing Lessor with any shortage in insurance proceeds (or adequate
assurance thereof) needed to make the repairs on or before the earlier of (i)
the date which is ten days after Lessee's receipt of Lessor's written notice
purporting to terminate this Lease, or (ii) the day prior to the date upon which
such option expires. If Lessee duly exercises such option during such period and
provides Lessor with funds (or adequate assurance thereof) to cover any shortage
in insurance proceeds, Lessor shall, at Lessor's commercially reasonable
expense, repair such damage as soon as reasonably possible and this Lease shall
continue in full force and effect. If Lessee fails to exercise such option and
provide such funds or assurance during the period, then this Lease shall
terminate on the date specified in the termination notice and Lessee's option
shall be extinguished.
9.6 Abatement of Rent; Lessee's Remedies.
(a) Abatement. In the event of Premises Partial Damage or Premised Total
Destruction or a Hazardous Substance Condition for which Lessee is not
responsible under this Lease, the Rent payable by Lessee for the period required
for the repair, remediation or restoration of such damage shall be abated in
proportion to the degree to which Lessee's use of the Premises is impaired. All
other obligations of Lessee hereunder shall be performed by Lessee, and Lessor
shall have no liability for any such damage, destruction, remediation, repair or
restoration except as provided herein.
(b) Remedies. If Lessor shall be obligated to repair or restore the
Premises and does not commence, in a substantial and meaningful way, such repair
or restoration within ninety (90) days after such obligation shall accrue,
Lessee may, at any time prior to the commencement of such repair or restoration,
give written notice to Lessor and to any Lenders of which Lessee has actual
notice, of Lessee's election to terminate this Lease on a date not less than
sixty (60) days following the giving of such notice. If Lessee gives such notice
and such repair or restoration is not commenced within thirty (30) days
thereafter, this Lease shall continue in full force and effect. "Commence" shall
mean either the unconditional authorization of the preparation of the required
plans, or the beginning of the actual work on the Premises, whichever first
occurs.
9.7 Termination--Advance Payments. Upon termination of this Lease pursuant
to this Paragraph 6.2(g) or Paragraph 9, an equitable adjustment shall be made
concerning advance Base Rent and any other advance payments made by Lessee to
Lessor. Lessor shall, in addition, return to Lessee so much of Lessee's Security
Deposit as has not been, or is not then required to be, used by Lessor.
9.8 Waive Statutes. Lessor and Lessee agree that the terms of this Lease
shall govern the effect of any damage to or destruction of the Premises with
respect to the termination of this Lease and hereby waive the provisions of any
present or future statute to the extent inconsistent herewith.
10. Real Property Taxes.
10.1 Definition of "Real Property Taxes." As used herein, the term "Real
Property Taxes" shall include any form of assessment; real estate, general,
special, ordinary or extraordinary, or rental levy or tax (other than
inheritance, personal income or estate taxes); improvement bond; and/or license
fee imposed upon or level against any legal or equitable interest of Lessor in
the Premises, Lessor's right to other income therefrom, and/or Lessor's business
of leasing, by any authority having the direct or indirect power to tax and
where the funds are generated with reference to the Building address and where
the proceeds so generated are to be applied by the city, county or other local
taxing authority of a jurisdiction within which the Premises are located. The
term "Real Property Taxes" shall also include tax, fee, levy, assessment or
charge, or any license therein, imposed by reason of events occurring during the
term of this Lease, including but not limited to, a change in the ownership of
the Premises.
10.2 (a) Payment of Taxes. Lessee shall pay the Real Property Taxes
applicable to the Premises during the term of this Lease. Subject to Paragraph
10.2(b), all such payments shall be made at least ten (10) days prior to the
delinquency date. Lessee shall promptly furnish Lessor with satisfactory
evidence that such taxes have been paid. If any such taxes shall cover any
period of time prior to or after the expiration or termination of this Lease,
Lessee's share of such taxes shall be prorated to cover only the portion of the
tax xxxx applicable to the period that this Lease is in effect, and Lessor shall
reimburse Lessee for any overpayment. If Lessee shall fail to pay any required
Real Property Taxes, Lessor shall have the right to pay the same, and Lessee
shall reimburse Lessor therefor upon demand.
(b) Advance Payment. In the event Lessee incurs a late charge on any
Rent payment, Lessor may, at Lessor's option, estimate the current Real Property
Taxes, and require that such taxes be paid in advance to Lessor by Lessee,
either: (i) in a lump such amount equal to the installment due, at least twenty
(20) days prior to the applicable delinquency date, or (ii) monthly in advance
with the payment of the Base Rent. If Lessor elects to require payment monthly
in advance, the monthly payment shall be an amount equal to the amount of the
estimated installment of taxes divided by the number of months remaining before
the month in which said installment becomes delinquent. When the actual amount
of the applicable tax xxxx is known, the amount of such equal monthly advance
payments shall be adjusted as required to provide the funds needed to pay the
applicable taxes. If the amount of collected by Lessor is insufficient to pay
such Real Property Taxes when due, Lessee shall pay Lessor, upon demand, such
additional sums as are necessary to pay such obligations. All moneys paid to
Lessor under this Paragraph may be intermingled with other moneys of
PAGE 5
Lessor and shall not bear interest. In the event of a Breach by Lessee in the
performance of its obligations under this Lease, then any balance of funds paid
to Lessor under the provisions of this Paragraph may at the option of Lessor, be
treated as an additional Security Deposit.
10.3 Joint Assessment. If the Premises are not separately assessed,
Lessee's liability shall be an equitable proportion of the Real Property Taxes
for all of the land and improvements included within the tax parcel assessed,
such proportion to be conclusively determined by Lessor from the respective
valuations assigned in the assessor's work sheets or such other information as
may be reasonably available.
10.4 Personal Property Taxes. Lessee shall pay, prior to delinquency, all
taxes assessed against and levied upon Lessee Owned Alterations, Utility
Installations, Trade Fixtures, furnishings, equipment and all personal property
of Lessee. When possible, Lessee shall such property to be assessed and billed
separately from the real property of Lessor. If any of Lessee's said personal
property shall be assessed with Lessor's real property, Lessee shall pay Lessor
the taxes attributable to Lessee's property within ten (10) days after receipt
of a written statement.
11. Utilities. Lessee shall pay for all water, gas, heat, light, power,
telephone, trash disposal and other utilities and services supplied to the
Premises, together with any taxes thereon. If any such services are not
separately metered to Lessee, Lessee shall pay a reasonable proportion, to be
determined by Lessor, of all charges jointly metered. (All subject to
Paragraphs 6 through 6.3 of Exhibit "A" to Addendum hereto.
12. Assignment and Subletting. (All subject to Paragraph 10 of Exhibit "A" to
Addendum hereto)
12.1 Lessor's Consent Required.
(a) Lessee shall not voluntarily or by operation of law assign,
transfer, mortgage or otherwise transfer or encumber (collectively, "assign or
assignment") or sublet all or any part of Lessee's interest in this Lease or in
the Premises without Lessor's prior written consent.
(b) A change in the control of Lessee shall constitute an assignment
requiring consent. The transfer, on a cumulative basis, of twenty-five percent
(25%) or more of the voting control of Lessee shall constitute a change in
control for this purpose.
(c) The involvement of Lessee or its assets in any transaction, or
series of transactions (by way of merger, sale, acquisition, financing,
transfer, leveraged buy-out or otherwise), whether or not a formal assignment or
hypothecation of this Lease or Lessee's assets occurs, which results or will
result in a reduction of the Net Worth of Lessee by an amount greater than
twenty-five percent (25%) of such Net Worth as it was represented at the time of
the execution of this Lease or at the time of the most recent assignment to
which Lessor has consented, or as it exists immediately prior to said
transaction or transactions constituting such reduction, whichever was or is
greater, shall be considered an assignment of this Lease to which Lessor may
withhold its consent. "Net Worth of Lessee" shall mean the net worth of Lessee
(excluding any guarantors) established under generally accepted accounting
principles.
(d) An assignment or subletting without consent shall, at Lessor's
option, be a Default curable after notice per Paragraph 13.1(c), or a noncurable
Breach without the necessity of any notice and grace period. If Lessor elects to
treat such unapproved assignment or subletting as a noncurable Breach, Lessor
may either: (i) terminate this Lease, or (ii) upon thirty (30) days written
notice, increase the monthly Base Rent to one hundred ten percent (110%) of the
Base Rent then in effect. Further, in the event of such Breach and rental
adjustment, (i) the purchase price of any option to purchase the Premises held
by Lessee shall be subject to similar adjustment to one hundred ten percent
(110%) of the price previously in effect, and (ii) all fixed and non-fixed
rental adjustments scheduled during the remainder of the Lease term shall be
increased to One Hundred Ten Percent (110%) of the scheduled adjusted rent.
(e) Lessee's remedy for any breach of Paragraph 12.1 by Lessor shall
be limited to compensatory damages and/or injunctive relief.
12.2 Terms and Conditions Applicable to Assignment and Subletting.
(a) Regardless of Lessor's consent, any assignment or subletting
shall not: (i) be effective without the express written assumption by such
assignee or sublessee of the obligations of Lessee under this Lease, (ii)
release Lessee of any obligations hereunder, or (iii) alter the primary
liability of Lessee for the payment of Rent or for the performance of any other
obligations to be performed by Lessee.
(b) Lessor may accept any Rent or performance of Lessee's obligations
from any person other than Lessee pending approval or disapproval of an
assignment. Neither a delay in the approval or disapproval of such assignment
nor the acceptance of Rent or performance shall constitute a waiver or estoppel
of Lessor's right to exercise its remedies for the Default or Breach.
(c) Lessor's consent to any assignment or subletting shall not
constitute a consent to any subsequent assignment or subletting.
(d) In the event of any Default or Breach of Lessee, Lessor may
proceed directly against Lessee, any Guarantors or any one else responsible for
the performance of the Lessee's obligations under this Lease, including the
sublessee, without first exhausting Lessor's remedies against any other person
or entity responsible therefor to Lessor, or any security held by Lessor.
(e) Each request for consent to an assignment or subletting shall be
in writing, accompanied by information relevant to Lessor's determination as to
the financial and operational responsibility and appropriateness of the proposed
assignee or sublessee, including but not limited to the intended use and/or
required modification of the Premises. If any, together with a fee of $1,000, as
consideration for Lessor's consideration for Lessor's considering and processing
said request. Lessee agrees to provide Lessor with such other or additional
information and/or documentation as may be reasonably requested.
(f) Any assignee of, or sublessee under, this Lease shall, by reason
of accepting such assignment or entering into such sublease, be deemed to have
assumed and agreed to conform and comply with each and every term, covenant,
condition and obligation herein to be observed or performed by Lessee during the
term of said assignment or sublease, other than such obligations as are contrary
to or inconsistent with provisions of an assignment or sublease to which Lessor
has specifically consented in writing.
12.3 Additional Terms and Conditions Applicable to Subletting. The
following terms and conditions shall apply to any subletting by Lessee of all or
any part of the Premises and shall be deemed included in all subleases under
this Lease whether or not expressly incorporated therein:
(a) Lessee hereby assigns and transfers to Lessor all of Lessee's
interest in all Rent payable on any sublease, and Lessor may collect such Rent
and apply same toward Lessee's obligations under this Lease; provided, however,
that until a Breach shall occur in the performance of Lessee's obligations,
Lessee may collect said Rent. Lessor shall not, by reason of the foregoing or
any other assignment of such sublease, nor by reason of the collection of the
Rent, be deemed liable to the sublessee for any failure of Lessee to perform and
comply with any of Lessee's obligations to such sublessee.. Lessee hereby
irrevocably authorizes and directs any such sublessee, upon receipt of a written
notice from Lessor stating that a Breach exists in the performance of Lessee's
obligations under this Lease, to pay to Lessor the Rent due and to become due
under the sublease. Sublessee shall rely upon any such notice from Lessor and
shall pay all Rents to Lessor without any obligation or right to inquire as to
whether such Breach exists, notwithstanding any claim from Lessee to the
contrary.
(b) In the event of a Breach by Lessee, Lessor may, at its option,
require sublessee to attorn to Lessor, in which event Lessor shall undertake the
obligations of the sublessor under such sublease from the time of the exercise
of said option to the expiration of such sublease; provided, however, Lessor
shall not be liable for any prepaid rents or security deposit paid by such
sublessee to such sublessor or for any prior Defaults or Breaches of such
sublessor.
(c) Any matter requiring the consent of the sublessor under the
sublease shall also require the consent of Lessor.
(d) No sublessee shall further assign or sublet all or any part of
the Premises without Lessor's prior written consent.
(e) Lessor shall deliver a copy of any notice of Default or Breach by
Lessee to the sublessee, who shall have the right to cure the Default of Lessee
within the grace period, if any, specified in such notice. The sublessee shall
have a right of reimbursement and offset from and against Lessee for any such
Defaults cured by the sublessee.
13. Default; Breach; Remedies.
13.1 Default; Breach. A "Default" is defined as a failure by the Lessee
to comply with or perform any of the terms, covenants, conditions or rules under
this Lease. A "Breach" is defined as the occurrence of any one or more of the
following Defaults, and the failure of Lessee to cure such Default within any
applicable grace period:
(a) The abandonment of the Premises; or the vacating of the Premises
without providing a commercially reasonably level of security, or where the
coverage of the property insurance described in Paragraph 8.3 is jeopardized as
a result thereof, or without providing reasonable assurances to minimize
potential vandalism.
(b) The failure of Lessee to make any payment of Rent or any Security
Deposit required to be made by Lessee hereunder, whether to Lessor or to a third
party, when due, to provide reasonable evidence of insurance or surety bond, or
to fulfill any obligation under this Lease which endangers or threatens life or
property, where such failure continues for a period of five (5) business days
following written notice to Lessee.
PAGE 6
(c) The failure by Lessee to provide (i) reasonable written evidence
of compliance with Applicable Requirements, (ii) the service contracts, (iii)
the rescission of an unauthorized or subletting, (iv) a Tenancy Statement, (v) a
requested subordination, (vi) evidence concerning any guaranty and/or Guarantor,
(vii) any document requested under Paragraph 42 (easements), or (viii) any other
documentation or information which Lessor may reasonably require of Lessee under
the terms of this Lease, where any such failure continues for a period of ten
(10) days following written notice to Lessee.
(d) A Default by Lessee as to the terms, covenants, conditions or
provisions of this Lease, or of the rules adopted under Paragraph 40 hereof,
other than those described in subparagraphs 13.1(a), (b) or (c), above, where
such Default continues for a period of thirty (30) days after written notice;
provided, however, that if the nature of Lessee's Default is such that more than
thirty (30) days are reasonably required for its cure, then it shall not be
deemed to be a Breach if Lessee commences such cure within said thirty (30) day
period and thereafter diligently prosecutes such cure to completion.
(e) The occurrence of any of the following events: (i) the making of
any general arrangement or assignment for the benefit of creditors; (ii)
becoming a "debtor" as defined in 11 U.S.C. (S) 101 or any successor statute
thereto (unless, in the case of a petition filed against Lessee, the same is
dismissed within sixty (60) days); (iii) the appointment of a trustee or
receiver to take possession of substantially all of Lessee's assets located at
the Premises or of Lessee's interest in this Lease, where possession is not
restored to Lessee within sixty (60) days; or (iv) the attachment, execution or
other judicial seizure of substantially all of Lessee's assets located at the
Premises or of Lessee's interest in this Lease, where such seizure is not within
thirty (30) days; provided; however, in the event that any provision of this
subparagraph (e) is contrary to any applicable law, such provision shall be of
no force or effect, and not affect the validity of the remaining provisions.
(f) The discovery that any financial statement of Lessee or of any
Guarantor given to Lessor was materially false.
13.2 Remedies. If Lessee fails to perform any affirmative duties or
obligations, within ten (10) days after written notice (or in case of an
emergency, without notice), Lessor may, at its option, perform such duty or
obligation on Lessee's behalf, including but not limited to the obtaining of a
reasonably required bonds, insurance policies, or governmental licenses, permits
or approvals. The costs and expenses of any such performance by Lessor shall be
due and payable by Lessee upon receipt of invoice therefor. If any check given
to Lessor by Lessee shall not be honored by the bank upon which it is drawn,
Lessor, at its option, may require all future payments to be made by Lessee to
be made only by cashier's check. In the event of a Breach, Lessor may, with or
without further notice or demand, and without limiting Lessor in the exercise of
any right or remedy which Lessor may have by reason of such Breach:
(a) Terminate Lessee's right to possession of the Premises by any
lawful means, in which case this Lease shall terminate and Lessee shall
immediately surrender possession to Lessor. In such event Lessor shall be
entitled to recover from Lessee: (i) the unpaid Rent which had been earned at
the time of termination: (ii) the worth at the time of 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 the Lessee proves
could have been reasonably avoided; (iii) the worth at the time of award of the
amount by which the unpaid rent for the balance of the term after the time of
award exceeds the amount of such rental loss that the Lessee proves could be
reasonably avoided; and (iv) any other amount necessary to compensate Lessor for
all the detriment proximately caused by the Lessee'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 the cost of recovering
possession of the Premises, expenses of reletting, including necessary
renovation and alteration of the Premises, reasonable attorneys' fees, and that
portion of any leasing commission paid by Lessor in connection with this Lease
applicable to the unexpired term of this Lease. The worth at the time of award
of the amount referred to in provision (iii) of the immediately preceding
sentence shall be computed by discounting such amount at the discount rate of
the Federal Reserve Bank of the District within which the Premises are located
at the time of award plus one percent (1%). Efforts by Lessor to mitigate
damages caused by Lessee's Default or Breach of this Lease shall not waive
Lessor's right to recover damages under this Paragraph 12. If termination of
this Lease is obtained through the provisional remedy of unlawful detainer,
Lessor shall have the right to recover in such proceeding the unpaid Rent and
damages as are recoverable therein, or Lessor may reserve the right to recover
all or any part thereof in a separate suit. If a notice and grace period
required under Paragraphs 13.1 was not previously given, a notice to pay rent or
quit, or to perform or quit given to Lessee under the unlawful detainer statute
shall also constitute the required by Paragraphs 13.1 and the unlawful detainer
statute shall run concurrently, and the failure of Lessee to cure the Default
within the greater of the two such grace periods shall constitute both an
unlawful detainer and a Breach of this Lease entitling Lessor to the remedies
provided for in this Lease and/or by said statute.
(b) Continue the Lease and Lessee's right to possession and recover
the Rent as It becomes due, in which event Lessee may sublet or assign, subject
only to reasonable limitations. Acts of maintenance, efforts to relet, and/or
the appointment of a receiver to protect the Lessor's interests, shall not
constitute a termination of the Lessee's right to possession.
(c) Pursue any other remedy now or hereafter available under the laws
or judicial decisions of the state wherein the Premises are located. The
expiration or termination of this Lease and/or the termination of Lessee's
rights to possession shall not relieve Lessee from liability under any indemnity
provisions of this Lease as to matters occurring or accruing during the term
hereof or by reason of Lessee's occupancy of the Premises.
13.3 Inducement Recapture. Any agreement for free or abated rent or other
charges, or for the giving or paying by Lessor to or for Lessee of any cash or
other bonus, inducement or consideration for Lessee's entering into this Lease,
all of which concessions are hereinafter referred to as "Inducement Provisions"
shall be deemed conditioned upon Lessee's full and faithful performance of all
of the terms, covenants and conditions of this Lease. Upon Breach of this Lease
by Lessee, any such Inducement Provision shall automatically be deemed deleted
from this Lease and of no further force or effect, and any rent, other charge,
bonus, inducement or consideration theretofore abated, given or paid by Lessor
under such an Inducement Provision shall be immediately due and payable by
Lessee to Lessor, notwithstanding any subsequent cure of said Breach by Lessee.
The acceptance by Lessor of rent or the cure of the Breach which initiated the
operation of this paragraph shall not be deemed a waiver by Lessor of the
provisions of this paragraph unless specifically so stated in writing by Lessor
at the time of such acceptance.
13.4 Late Charges. Lessee hereby acknowledges that late payment by Lessee
to Lessor of Rent will cause Lessor to incur costs not contemplated by this
Lease, the exact amount of which will be extremely difficult to ascertain. Such
costs include, but are not limited to, processing and accounting charges, and
late charges which may be imposed upon Lessor by any Lender. Accordingly, if any
Rent shall not be received by Lessor within ten (10) days after such amount
shall be due, then, without any requirement for notice to Lessee, Lessee shall
pay to Lessor a one-time late charge equal to five percent (5%) of such overdue
amount. The parties hereby agree that such late charge represents a fair and
reasonable estimate of the costs Lessor will incur by reason of late payment.
Acceptance of such late charge by Lessor shall in no event constitute a waiver
of Lessee's Default or Breach with respect to such overdue amount, nor prevent
the exercise of any of the other rights and remedies granted hereunder. In the
event that a late charge is payable hereunder, whether or not collected, for
three (3) consecutive installments of Base Rent, then notwithstanding any
provision of this Lease to the contrary, Base Rent shall, at Lessor's option,
become due and payable quarterly in advance.
13.5 Interest. Any monetary payment due Lessor hereunder, not received by
Lessor, when due as to scheduled payments (such as Base Rent) or within thirty
(30) days following the date on which it was due for non-scheduled payment,
shall bear interest from the date when due, as to scheduled payments, or the
thirty-first (31st) day after it was due as to non-scheduled payments. The
interest ("Interest") charged shall be equal to the prime rate reported in the
Wall Street Journal as published closest prior to the date when due is plus four
percent (4%), but shall not exceed the maximum rate allowed by law. Interest is
payable in addition to the potential late charge provided for in Paragraph 13.4.
13.6 Breach by Lessor.
(a) Notice of Breach. Lessor shall not be deemed in breach of this
Lease unless Lessor fails within a reasonable time to perform an obligation
required to be performed by Lessor. For purposes of this Paragraph, a reasonable
time shall in no event be less than thirty (30) days after receipt by Lessor,
and any lender whose name and address shall have been furnished Lessee in
writing for such purpose, of written notice specifying wherein such obligation
of Lessor has not been performed; provided, however, that if the nature of
Lessor's obligation is such that more than thirty (30) days are reasonably
required for its performance, then Lessor shall not be in breach if performance
is commenced within such thirty (30) day period and thereafter diligently
pursued to completion.
(b) Performance by Lessee on Behalf of Lessor. In the event that
neither Lessor nor Lender cures said breach within thirty (30) days after
receipt of said notice, or if having commenced said cure they do not diligently
pursue it to completion, then Lessee may elect to cure said breach at Lessee's
expense and offset from Rent and amount equal to the greater of one month's Base
Rent or the Security Deposit, and to pay an excess of such expense under
protest, reserving Lessee's right to reimbursement from Lessor. Lessee shall
document the cost of said cure and supply said documentation to Lessor.
14. Condemnation. If the Premises or any portion thereof are taken under the
power of eminent domain or sold under the threat of the exercise of said power
(collectively "Condemnation"), this Lease shall terminate as to the part so
taken as of the date the condemning authority takes title or possession,
whichever first occurs. If more than ten percent (10%) of any building portion
of the premises, or more than twenty-five percent (25%) of the land area portion
of the premises not occupied by any building, is taken by Condemnation, Lessee
may, at Lessee's option, to be exercised in writing within ten (10) days after
Lessor shall have given Lessee written notice of such taking (or in the absence
of such notice, within ten (10) days after the condemning authority shall have
taken possession) terminate this Lease as of the date the condemning authority
takes such possession. If Lessee does not terminate this Lease in accordance
with the foregoing, this Lease shall remain in full force and effect as to the
portion of the Premises remaining, except that the Base Rent shall be reduced in
proportion to the reduction in utility of the Premises caused by such
Condemnation. Condemnation awards and/or payments shall be the property of
Lessor, whether such award shall be made as compensation for diminution in value
of the leasehold,
PAGE 7
the value of the part taken, or for severance damages; provided, however, that
Lessee shall be entitled to any compensation for Lessee's relocation expenses,
loss of business goodwill and/or Trade Fixtures, without regard to whether or
not this Lease is terminated pursuant to the provisions of this Paragraph. All
Alterations and Utility Installations made to the Premises by Lessee, for
purposes of Condemnation only, shall be considered the property of the Lessee
and Lessee shall be entitled to any and all compensation which is payable
therefor. In the event that this Lease is not terminated by reason of the
Condemnation, Lessor shall repair any damage to the Premises caused by such
Condemnation.
15. Brokers Fee.
15.1 Deleted
15.2 Deleted
15.3 Representations and Indemnities of Broker Relationships. Lessee and
Lessor each represent and warrant to the other that it has had no dealings with
any person, firm, broker or finder (other than the Brokers, if any) in
connection with the Lease, and that no one other than said named Brokers is
entitled to any commission or finder's fee in connection herewith. Lessee and
Lessor do each hereby agree to indemnify, protect, defend, and hold the other
harmless from and against liability for compensation or charges which may be
claimed by any such unnamed broker, finder or other similar party by reason of
any dealings or actions of the indemnifying Party, including any costs,
expenses, attorneys' fees reasonably incurred with respect thereto.
16. Estoppel Certificates.
(a) Each Party (as "Responding Party") shall within ten (10) business
days after written notice from the other Party (the "Requesting Party") execute,
acknowledge and deliver to the Requesting Party a statement in writing in form
similar to the then most current "Tenancy Statement" form published by the
American Industrial Real Estate Association plus such additional information,
confirmation and/or statements as may be reasonably requested by the Requesting
Party.
(b) If the Responding Party shall fail to execute or deliver the
Estoppel Certificate within such ten day period, the Requesting Party may
execute an Estoppel Certificate stating that: (i) the Lease is in full force and
effect without modification except as may be represented by the Requesting
Party, (ii) there are no uncured defaults in the Requesting Party's performance,
and (iii) if Lessor is the Requesting Party, not more than one month's rent has
been paid in advance. Prospective purchasers and encumbrances may rely upon the
Requesting Party's Estoppel Certificate, and the Responding Party shall be
estopped from denying the truth of the facts contained in said Certificate.
(c) If Lessor desires to finance, refinance up to four (4) times in
any given twelve (12) month period or sell the Premises, or any part thereof,
Lessee and all Guarantors shall deliver to any potential lender or purchaser
designated by Lessor such financial statements as may be reasonably required by
such lender or purchaser, including but not limited to Lessee's financial
statements for the past three (3) years. All such financial statements shall be
received by Lessor and such lender or purchaser in confidence and shall be used
only for the purposes herein set forth.
17. Definition of Lessor. The term "Lessor" as used herein shall mean the
owner or owners at the time in question of the fee title to the Premises, or, if
this is a sublease, of the Lessee's interest in the prior lease. In the event of
a transfer of Lessor's title or interest in the Premises or this Lease, Lessor
shall deliver to the transferee or assignee (in cash or by credit) any unused
Security Deposit held by Lessor. Except as provided in Paragraph 15, upon such
transfer or assignment and delivery of the Security Deposit, as aforesaid, the
prior Lessor shall be relieved of all liability with respect to the obligations
and/or covenants under this Lease thereafter to be performed by the Lessor.
Subject to the foregoing, the obligations and/or covenants in this Lease to be
performed by the Lessor shall be binding only upon the Lessor as hereinabove
defined. Notwithstanding the above, the subject to the provisions of Paragraph
20 below, the original Lessor under this Lease, and all subsequent holders of
the Lessor's interest in this Lease shall remain liable and responsible with
regard to the potential duties and liabilities of Lessor pertaining to Hazardous
Substances as outlined in Paragraph 6 above.
18. Severability. The invalidity of any provision of this Lease, as determined
by a court of competent jurisdiction, shall in no way affect the validity of an
other provision hereof.
19. Days. Unless otherwise specifically indicated to the contrary, the word
"days" as used in this Lease shall mean and refer to calendar days.
20. Limitation on Liability. Subject to the provisions of Paragraph 17 above,
the obligations of Lessor under this Lease shall not constitute personal
obligations of Lessor, the individual partners of Lessor or its or their
individual partners, directors, officers or shareholders, and Lessee shall look
to the Premises, and to no other assets of Lessor, for the satisfaction of any
liability of Lessor with respect to this Lease, and shall not seek recourse
against the individual partners of Lessor, or its or their individual partners,
directors, officers or shareholders, or any of their personal assets for such
satisfaction.
21. Time of Essence. Time is of the essence with respect to the performance of
all obligations to be performed or observed by the Parties under this Lease.
22. No Prior or Other Agreements; Broker Disclaimer. This Lease contains all
agreements between the Parties with respect to any matter mentioned herein, and
no other prior or contemporaneous agreement or understanding shall be effective.
Lessor and Lessee each represents and warrants to the Broker that it has made,
and is relying solely upon, its own investigation as to the nature, quality,
character and financial responsibility of the other Party to the Lease and as to
the nature, quality and character of the Premises. Brokers have no
responsibility with respect thereto or with respect to any default or breach
hereof by either Party. The liability (including court costs and Attorneys'
fees), of any Broker with respect to negotiation, execution, delivery or
performance by either Lessor or Lessee under this Lease or any amendment or
modification hereto shall be limited to an amount up to the fee received by such
Broker pursuant to this Lease; provided, however, that the foregoing limitation
on each Broker's liability shall not be applicable to any gross negligence or
willful misconduct of such Broker.
23. Notices.
23.1 Notice Requirements. All notices required or permitted by this Lease
shall be in writing and may be delivered in person (by hand or by courier) or
may be sent by, certified or registered mail or U.S. Postal Service Express
Mail, with postage prepaid, or by facsimile transmission, and shall be deemed
sufficiently given if served in a manner specified in this Paragraph 23. The
addresses noted adjacent to a Party's signature on this Lease shall be that
Party's address for delivery or mailing of notices. Either Party may by written
notice to the other specify a different address for notice. A copy of all
notices to Lessor shall be concurrently transmitted to such party or parties at
such addresses as Lessor may from time to time hereafter designate in writing.
23.2 Date of Notice. Any notice sent by registered or certified mail,
return receipt requested, shall be deemed given on the date of delivery shown on
the receipt card, or if no delivery date is shown, the postmark thereon. Notices
delivered by United States Express Mail or overnight courier that guarantee next
day delivery shall be deemed given twenty-four (24) hours after delivery of the
same to the Postal Service or courier. Notices transmitted by facsimile
transmission or similar means shall be deemed delivered upon telephone
confirmation of receipt, provided a copy is also delivered via delivery or mail.
If notice is received on a Saturday, Sunday or legal holiday, it shall be deemed
received on the next business day.
24. Waivers. No waiver by Lessor of the Default or Breach of any term,
covenant or condition hereof by Lessee, shall be deemed a waiver of any other
term, covenant or condition hereof, or of any subsequent Default or Breach by
Lessee of the same or of any other term, covenant or condition hereof. Lessor's
consent to, or approval of, any act shall not be deemed to render unnecessary
the obtaining of Lessor's consent to, or approval of, any subsequent or similar
act by Lessee, or be construed as the basis of an estoppel to enforce the
provision or provisions of this Lease requiring such consent. The acceptance of
Rent by Lessor shall not be a waiver of any Default or Breach by Lessee. Any
payment by Lessee may be accepted by Lessor on account of moneys or damages due
Lessor, notwithstanding any qualifying statements or conditions made by Lessee
in connection therewith, which such statements and/or conditions shall be of no
force or effect whatsoever unless specifically agreed to in writing by Lessor at
or before the time of deposit of such payment.
25. Recording. Either Lessor or Lessee shall, upon request of the other,
execute, acknowledge and deliver to the other a short form memorandum of this
Lease for recording purposes. The Party requesting recordation shall be
responsible for payment of any fees applicable thereto.
26. No Right To Holdover. Lessee has no right to retain possession of the
Premises or any part thereof beyond the expiration or earlier termination of
this Lease. In the event that Lessee holds over, then the Base Rent shall be
increased to one hundred twenty-five percent (25%) of the Base Rent applicable
during the month immediately preceding the expiration or termination. Nothing
contained herein shall be construed as consent by Lessor to any holding over by
Lessee.
27. Cumulative Remedies. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other remedies at
law or in equity.
28. Covenants and Conditions; Construction of Agreement. All provisions of
this Lease to be observed or performed by Lessee are both covenants and
conditions. In consulting this Lease, all headings and titles are for the
convenience of the parties only and shall not be considered a part of this
Lease. Whenever required by the context, the singular shall include the plural
and vice versa. This Lease shall not be construed as if prepared by one of the
parties, but rather according to its fair meaning as a whole, as if both parties
had prepared it.
PAGE 8
29. Binding Effects; Choice of Law. This Lease shall be binding upon the
parties, their personal representatives, successors and assigns and be governed
by the laws of the State in which the Premises are located. Any litigation
between the Parties hereto concerning this Lease shall be initiated in the
county in which the Premises are located.
30. Subordination; Attornment; Non-Disturbance.
30.1 Subordination. This Lease and any Option granted hereby shall be
subject and subordinate to any ground lease, mortgage, deed of trust, or other
hypothecation or security device (collectively, "Security Device"), now or
hereafter placed by upon the Premises, to any and all advances made on the
security thereof, and to all renewals, modifications, and extensions thereof.
Lessee agrees that the holders of any such Security Devices (in this Lease
together referred to as "Lessor's Lender") shall have no liability or obligation
to perform any of the obligations of Lessee under this Lease. Any Lender may
elect to have this Lease and/or any Option granted hereby superior to the lien
of its Security Device by giving written notice thereof to Lessee, whereupon
this Lease and such Options shall be deemed prior to such Security Device,
notwithstanding the relative dates of the documentation or recordation thereof.
30.2 Attornment. Subject to the non-disturbance provision of Paragraph
30.3, Lessee agrees to attorn to a Lender or any other party who acquires
ownership of the Premises by reason of a foreclosure of a Security Device, and
that in the event of such foreclosure, such new owner shall not: (i) be liable
for any act or omission of any prior lessor or with respect to events occurring
prior to acquisition of ownership, (ii) be subject to any offsets or defenses
which Lessee might have against any prior lessor, or (iii) be bound by
prepayment of more than one month's rent.
30.3 Non-Disturbance. With respect to Security Devices now existing or
hereafter entered into by Lessor after the execution of this Lease, Lessee's
subordination of this Lease shall be subject to receiving a commercially
reasonable agreement (a "Non-Disturbance Agreement") from the Lender which Non-
Disturbance Agreement provides that Lessee's possession of the Premises, and
this Lease, including any options to extend the term hereof, will not be
disturbed so long as Lessee is not in Breach hereof and attorns to the record
owner of the Premises. Further, within sixty (60) days after the execution of
this Lease, Lessor shall use its commercially reasonable efforts to obtain a
Non-Disturbance Agreement from the holder of any pre-existing Security Device
which is secured by the Premises. In the event that Lessor is unable to provide
the Non-Disturbance Agreement within said sixty (60) days, then Lessee may, at
Lessee's option, directly contact Lessor's lender and attempt to negotiate for
the execution and delivery of a Non-Disturbance Agreement.
30.4 Self-Executing. The agreements contained in this Paragraph 30 shall
be effective without the execution of any further documents; provided however,
that, upon written request from Lessor or a Lender or Lessee in connection with
a sale, financing or refinancing of the Premises, Lessee and Lessor shall
execute such further writings as may be reasonably required to separately
document any such subordination, attornment and/or Non-Disturbance Agreement
provided for herein.
31. Attorney's Fees. If any Party brings an action or proceeding involving the
Premises to enforce the terms hereof or declare rights hereunder, the Prevailing
Party (as hereafter defined) in any such proceeding, action, or appeal thereon,
shall be entitled to reasonable attorney's fees. Such fees may be awarded in
the same suit or recovered in a separate suit, whether or not such action or
proceeding is pursued to decision or judgment. The term, "Prevailing Party"
shall include, without limitation, a Party who substantially obtains or defeats
the relief sought, as the case may be, whether by compromise, settlement,
judgment, or the abandonment by the other Party of its claim or defense. The
attorney's fee award shall not be computed in accordance with any court fee
schedule, but shall be such as to fully reimburse all attorney's fees reasonably
incurred. In addition, Lessor shall be entitled to attorney's fees, costs and
expenses incurred in the preparation and service of notices of Default and
consultations in connection therewith, whether or not a legal action is
subsequently commenced in connection with such Default or resulting Breach.
32. Lessor's Access; Showing Premises; Repairs. Lessor and Lessor's agents
shall have the right to enter the Premises at any time, in the case of an
emergency, and otherwise at reasonable times (subject to last sentence of
Section 6.4 above) for the purpose of showing the same to prospective
purchasers, lenders, or lessees, and making such alterations, repairs,
improvements or additions to the Premises as Lessor may reasonably deem
necessary. All such activities shall be without abatement of rent or liability
to Lessee may at any time place on the Premises any ordinary "For Sale" signs
and Lessor may during the last six (6) months of the term hereof place on the
Premises any ordinary "For Lease" signs. Lessee may at any time place on or
about the Premises any ordinary "For Sublease" sign.
33. Auctions. Lessee shall not conduct, nor permit to be conducted, any
auction upon the Premises without Lessor's prior written consent. Lessor shall
not be obligated to exercise any standard reasonableness in determining whether
to permit an auction.
34. Signs. Except or ordinary "For Sublease" signs, Lessee shall not place any
sign upon the Premises without Lessor's prior written consent. All signs must
comply with all Applicable Requirements.
35. Termination; Merger. Unless specifically stated otherwise in writing by
Lessor, the voluntary or other surrender of this Lease by Lessee, the mutual
termination or cancellation hereof, or a termination hereof by Lessor for Breach
by Lessee, shall automatically terminate any sublease or lesser estate in the
Premises; provided, however, that Lessor may elect to continue any one or all of
any existing subtenancies. Lessor's failure within ten (10) days following any
such event to elect to the contrary by written notice to the holder of any
lesser interest, shall constitute Lessor's election to have such event
constitute the termination of such interest.
36. Consents. Except as otherwise provided herein, wherever in this Lease the
consent of a Party is required to an act by or for the other Party, such consent
shall not be unreasonably withheld or delayed. Lessor's actual reasonable costs
and expenses (including but not limited to architects', attorneys', engineers'
or other consultants' fees) incurred in the consideration of, or response to, a
request by Lessee for any Lessor consent, including but not limited to consents
to an assignment, a subletting or the presence or use of a Hazardous Substance,
shall be paid by Lessee upon receipt of an invoice and supporting documentation
therefor. Lessor's consent to any act, assignment or subletting shall not
constitute an acknowledgement that no Default or Breach by Lessee of this Lease
exists, nor shall such consent be deemed a waiver of any then existing Default
or Breach, except as may be otherwise specifically stated in writing by Lessor
at the time of such consent. The failure to specify herein any particular
condition to Lessor's consent shall not preclude the imposition by Lessor at the
time of consent of such further or other conditions as are then reasonable with
reference to the particular matter for which consent is being given. In the
event that either Party disagrees with any determination made by the other
hereunder and reasonably requests for reasons for such determination, the
determining party shall furnish its reasons in writing and in reasonable detail
within ten (10) business days following such request.
37. Guarantor. deleted
37.1 deleted.
37.2 deleted.
38. Quiet Possession. Subject to payment by Lessee of the Rent and performance
of all of the covenants, conditions and provisions on Lessee's part to be
observed and performed under this Lease, Lessee shall have quiet possession and
quiet enjoyment of the Premises during the term hereof.
39. Options.
39.1 Definition. "Option" shall mean: (a) the right to extend the term
of or renew this Lease or to extend or renew any lease that Lessee has on other
property of Lessor; (b) the right of first refusal or first offer to lease
either the Premises or other property of Lessor; (c) the right to purchase or
the right of first refusal to purchase the Premises or other property of Lessor.
See Option to Extend Addendum - Attached.
39.2 Options Personal To Original Lease. Each Option granted to Lessee in
this Lease is personal to the original Lessee, and cannot be assigned or
exercised by anyone other than said original Lessee and only while the original
Lessee is in full possession of the Premises and, if requested by Lessor, with
Lessee certifying that Lessee has no intention of thereafter assigning or
subletting.
39.3 Multiple Options. In the event that Lessee has any multiple Options
to extend or renew this Lease, a later Option cannot be exercised unless the
prior Options have been validly exercised.
39.4 Effect of Default on Options.
(a) Lessee shall have no right to exercise an Option: (i) during the
period commencing with the giving of any notice of Default and continuing until
said Default is cured, (ii) during the period of time any Rent is unpaid
monetary (without regard to whether notice thereof is given Lessee), (iii)
during the time Lessee is in Breach of this Lease, or (iv) in the event that
Lessee has been given three (3) or more notices of monetary Default, whether or
not the Defaults are cured, during the twelve (12) month period immediately
preceding the exercise of the Option.
(b) The period of time within which an Option may be exercised shall
not be extended or enlarged by reason of Lessee's inability to exercise an
Option because of the provisions of Paragraph 39.4(a).
(c) An Option shall terminate and be of no further force or effect,
notwithstanding Lessee's due and timely exercise of the Option, if, after such
exercise and prior to the commencement of the extended term, (i) Lessee fails to
pay Rent for a period of thirty (30) days after such Rent becomes due (without
any necessity of Lessor to give notice thereof), (ii) Lessor gives to Lessee
three (3) or more notices of monetary Default during any twelve month period,
whether or not the Defaults are cured, or (iii) if Lessee commits a Breach of
this Lease.
PAGE 9
40. Multiple Buildings. deleted.
41. Security Measures. Lessee hereby acknowledges that the rental payable to
Lessor hereunder does not include the cost of guard service or other security
measures, and that Lessor shall have no obligation whatsoever to provide same.
Lessee assumes all responsibility for the protection of the Premises, Lessee,
its agents and invitees, and their property from the acts of third parties.
42. Reservations. Lessor reserves to itself the right, from time to time, to
grant, without the consent or joinder of Lessee, such easements, rights, and
dedications that Lessor deems necessary, and to cause the recordation of parcel
maps and restrictions, so long as such easements, rights, dedications, maps, and
restrictions do not unreasonably interfere with the use of the Premises by
Lessee. Lessee agrees to sign any documents reasonably requested by Lessor to
effectuate any such easement rights, dedication, map or restrictions.
43. Performance Under Protest. If at any time a dispute shall arise as to any
amount or sum of money to be paid by one Party to the other under the provisions
hereof, the Party against whom the obligation to pay the money is asserted shall
have the right to make payment "under protest" and such payment shall not be
regarded as voluntary payment and there shall survive the right on the part of
said Party to institute suit for recovery of such sum. If it shall be adjudged
that there was no legal obligation on the part of said Party to pay such sum or
any part thereof, said Party shall be entitled to recover such sum or so much
thereof as it was not legally required to pay.
44. Authority. If either Party hereto is a corporation, trust, limited
partnership company, partnership, or similar entity, each individual executing
this Lease on behalf of such entity represents and warrants that he or she is
duly authorized to execute and deliver this Lease on its behalf. Each party,
within thirty (30) days after request, deliver to the other party satisfactory
evidence of such authority.
45. Conflict. Any conflict between the printed provisions of this Lease and
the typewritten or handwritten provisions shall be controlled by the typewritten
or handwritten provisions.
46. Offer. Preparation of this Lease by either Party or their agent and
submission of same to the other Party shall not be deemed an offer to lease to
the other Party. This Lease is not intended to be binding until executed by all
Parties hereto.
47. Amendments. This Lease may be modified only in writing, signed by the
Parties in interest at the time of the modification.
48. Multiple Parties. If more than one person or entity is named herein as
either Lessor or Lessee, such multiple Parties shall be the joint and several
responsibility to comply with the terms of this Lease.
49. Mediation and Arbitration of Disputes. An Addendum requiring the Mediation
and/or the Arbitration of all disputes between the Parties and/or Brokers
arising out of this Lease [_] is [X] is not attached to this Lease.
LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
PROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE, SHOW THEIR
INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE
TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE
AND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE
PREMISES.
--------------------------------------------------------------------------------
ATTENTION: NO REPRESENTATIVE OR RECOMMENDATIONS IS MADE BY THE AMERICAN
INDUSTRIAL REAL ESTATE ASSOCIATION OR B ANY BROKER AS TO THE LEGAL SUFFICIENCY,
LEGAL EFFECT OR TAX CONSEQUENCES OF THIS LEASE OR THE TRANSACTION TO WHICH IT
RELATES. THE PARTIES ARE URGED TO:
1. SEEK ADVICE OF COUNSEL AS TO THE LEGAL TAX CONSEQUENCES OF THIS LEASE.
2. RETAIN APPROPRIATE CONSULTANTS TO REVIEW AND INVESTIGATE THE CONDITION OF
THE PREMISES, SAID INVESTIGATION SHOULD INCLUDE BUT NOT BE LIMITED TO: THE
POSSIBLE PRESENCE OF HAZARDOUS SUBSTANCES, THE ZONING OF THE PREMISES, THE
STRUCTURAL INTEGRITY, THE CONDITION OF THE ROOF AND OPERATING SYSTEMS, AND THE
SUITABILITY OF THE PREMISES FOR LESSEE'S INTENDED USE.
WARNING: IF THE PREMISES IS LOCATED IN A STATE OTHER THAN CALIFORNIA, CERTAIN
-------
PROVISIONS OF THE LEASE MAY NEED TO REVISED TO COMPLY WITH THE STATE IN WHICH
THE PREMISES IS LOCATED.
--------------------------------------------------------------------------------
The parties hereto have executed this Lease at the place on the dates specified
above to their respective signatures.
Executed at Cupertino, California Executed at ______________________________
on ________________________________ on _______________________________________
by LESSOR: by LESSEE:
ROSE VENTURES II, INC., EQUINIX, INC.
----------------------------------- ------------------------------------------
a California corporation a California corporation
----------------------------------- ------------------------------------------
By: /s/ Xxxxxxx X. Xxxxxxx By:_______________________________________
--------------------------------
Name Printed: Xxxxxxx X. Xxxxxxx Name Printed:
Title: President Title:
---------------------------
By:________________________________ By: /s/ [signature illegible
---------------------------------------
Name Printed: _____________________ Name Printed: ____________________________
Title:_____________________________ Title:____________________________________
Address:___________________________ Address:__________________________________
Telephone: (000) 000-0000 Telephone: (___)__________________________
------------------
Facsimile: (000) 000-0000 Facsimile: (___)__________________________
------------------
Federal ID No. ____________________ Federal ID No.____________________________
NOTE: These forms are often modified to meet changing requirements of law and
industry needs. Always write or call to make sure you are utilizing the
most current form: AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION, 000 Xx.
Xxxxxx Xxxxxx, Xxxxx 000, Xxx Xxxxxxx, Xxxxxxxxxx 00000. (000) 000-0000.
Fax No. (000) 000-0000
PAGE 10
OPTION(S) TO EXTEND
STANDARD LEASE ADDENDUM
Dated June 20, 1999
By and Between (Lessor) Rose Ventures II, Inc.
(Lessee) EQUINIX, Inc.
Address of Premises: [*], San Jose, CA
Paragraph 39.1.1
A. OPTION(S) TO EXTEND:
Lessor hereby grants to Lessee the option to extend the term of this Lease for
three (3) additional sixty (60) month period(s) commencing when the prior term
expires upon each and all of the following terms and conditions:
(i) In order to exercise an option to extend, Lessee must give
written notice of such election to Lessor and Lessor must receive the same at
least six months prior to the date that the option period would commence, time
being of the essence. If proper notification of the exercise of an option is not
given and/or received, such option shall automatically expire. Options (if there
are more than one) may only be exercised consecutively.
(ii) The provisions of paragraph 39, including those relating to
Lessee's Default set forth in paragraph 39.4 of this Lease, are conditions of
this Option.
(iii) Except for the provisions of this Lease granting an option or
options to extend the term, all of the terms and conditions of this Lease except
where specifically modified by this option shall apply.
(iv) This Option is personal to the original Lessee, and cannot be
assigned or exercised by anyone other than said original Lessee and only while
the original Lessee is in full possession of the Premises and without the
intention of thereafter assigning or subletting.
(v) The monthly rent for each month of the option period shall be
calculated as follows, using the method(s) indicated below:
(Check Method(s) to be Used and Fill In Appropriately)
[_] I. Cost of Living Adjustment(s) (COLA)
a. On (Fill in COLA Dates):
____________________________________________
__________________________________________________________________________
____________
the Base Rent shall be adjusted by the change, if any, from the Base Month
specified below, in the Consumer Price Index of the Bureau of Labor
Statistics of the U.S. Department of Labor for (select one): [_] CPI W
(Urban Wage Earners and Clerical Workers) or [_] CPI U
(All Urban Consumers), for (Fill in Urban Area):
___________________________________________________________________________
All Items (1982-1984 = 100), herein referred to as "CPI"
b. The monthly rent payable in accordance with paragraph A.I.a. of this
Addendum shall be calculated as follows: the Base Rent set forth in
paragraph 1.5 of the attached Lease, shall be multiplied by a fraction the
numerator of which shall be the CPI of the calendar month two months prior
to the month(s) specified in paragraph A.I.a. above during which the
adjustment is to take effect, and the denominator of which shall be the CPI
of the calendar month which is two months prior to (select one): the
first month of the term of this Lease as set forth in paragraph 1.3 ("Base
Month") or (Fill in Other "Base Month"): ________________________. The
sum so calculated shall constitute the new monthly rent hereunder, but in
no event, shall any such new monthly rent be less than the rent payable for
the month immediately preceding the rent adjustment.
c. In the event the compilation and/or publication of the CPI shall be
transferred to any other governmental department or bureau or agency or
shall be discontinued, then the index most nearly the same as the CPI shall
be used to make such calculation. In the event that the Parties cannot
agree on such alternative index, then the matter shall be submitted for
decision to the American Arbitration Association in accordance with the
then rules of said Association and the decision of the arbitrators shall be
binding upon the parties. The cost of said Arbitration shall be paid
equally by the Parties.
[X] II. Market Rental Value Adjustment(s) (MRV)
a. On (Fill in MRV Adjustment Date(s)) proposed commencement dates of
each Option Term following due notice of Lessee's exercise of said Option,
the Base Rent shall be adjusted to the "Market Rental Value" of the
properly as follows:
1) Four months prior to each Market Rental Value Adjustment Date
described above, the Parties shall attempt to agree upon what the new MRV will
be on the adjustment date. If agreement cannot be reached, within thirty days,
then:
(a) Lessor and Lessee shall immediately appoint a mutually
acceptable appraiser or broker to establish the new MRV within the next thirty
days. Any associated costs will be split equally between the Parties, or
(b) Both Lessor and Lessee shall each immediately make a
reasonable determination of the MRV and submit such determination, in writing,
to arbitration in accordance with the following provisions:
(i) Within fifteen days thereafter, Lessor and Lessee shall
each select an appraiser or broker ("Consultant" - check one) of their choice to
act as an arbitrator. The two arbitrators so appointed shall immediately select
a third mutually acceptable Consultant to act as a third arbitrator.
(ii) The three arbitrators shall within thirty days of the
appointment of the third arbitrator reach a decision as to what the actual MRV
for the Premises is, and whether Lessor's or Lessee's submitted MRV is the
closest thereto. The decision of a majority of the arbitrators shall be binding
on the Parties. The submitted MRV which is determined to be the closest to the
actual MRV shall thereafter be used by the Parties.
(iii) If either of the Parties fails to appoint an
arbitrator within the specified fifteen days, the arbitrator timely appointed by
one of them shall reach a decision on his or her own, and said decision shall be
binding on the Parties.
(iv) The entire cost of such arbitration shall be paid by
the party whose submitted MRV is not selected, i.e., the one that is NOT the
closet to the actual MRV.
2) Notwithstanding the foregoing, the new MRV shall not be less than
the rent payable for the month immediately preceding the rent adjustment.
b. Upon the establishment of each New Market Rental Value:
1) The new MRV will become the new "Base Rent" for the purpose of
calculating any further Adjustments, and
2) the first month of each Market Rental Value term shall become the
new "Base Month" for the purpose of calculating any further Adjustments.
3) Annual upward adjustments of rent during Option Terms shall be
determined when Market Rent Value Adjustments are determined hereunder.
[_] III. Fixed Rental Adjustment(s) (FRA)
The Base Rent shall be increased to the following amounts on the dates set forth
below:
On (Fill in FRA Adjustment Date(s)): The New Base Rent shall be:
----------------------------------- $ ----------------------------------
----------------------------------- $ ----------------------------------
----------------------------------- $ ----------------------------------
----------------------------------- $ ----------------------------------
B. NOTICE:
Unless specified otherwise herein, notice of any rental adjustments,
other than Fixed Rental Adjustments, shall be made as specified in paragraph 23
of the Lease.
EXHIBIT "A"
-----------
All that certain real property situate in the City of San Xxxx, County of Santa
Xxxxx, State of California, described as follows:
Parcel 2, as shown on that certain Parcel Map filed for record on November 16,
1982 in the office of the Recorder of the County of Santa Xxxxx, State of
California in Book [*] of Maps at Pages [*] and [*].
Together with the following described "Transfer Area"
Beginning at the most Westerly corner of Parcel 1, as shown on that certain
Parcel Map filed for record on November 16, 1982 in Book [*] of Maps at Pages
[*] & [*], Santa Xxxxx County Records;
Thence from said Point of Beginning, North 37(degrees) 00' 37" East 150.00 feet
along the Northwesterly line of said Parcel 1;
Thence South 52(degrees) 59' 50" East 412.39 feet along a line parallel and
105.00 feet Northeasterly, measured at right angles, to the Southwesterly line
of said Parcel 1;
Thence North 37(degrees) 99' 10" East 13.40 feet;
Thence South 52(degrees) 59' 50" East 399.20 feet along a line parallel and
163.40 feet Northeasterly, measured at right angles, to the Southwesterly line
of said Parcel 1, to a point in a non-tangent curve in the Southeasterly common
boundary between said Parcel 1 and said Parcel 2;
Thence Southwesterly along said non-tangent curve to the right, the center of
which bears North 26(degrees) 32' 24" West, having a radius of 3485.00 feet,
through a central angle of 3(degrees) 02' 33" for an arc length of 185.05 feet
to the most Southerly corner of said Parcel 1;
Thence along said Southwesterly line of said Parcel 1 North 52(degrees) 59' 50"
West 724.80 feet to the point of beginning.
Excepting therefrom all that portion thereof as conveyed to the State of
California by instrument recorded December 31, 1986 in book [*] at Page [*] of
Official Records, being more particularly described as follows:
A portion of Parcel 2 as shown on that certain Parcel Map filed for record in
the office of the Recorder of Santa Xxxxx County on November 16, 1982 in Book
[*] of Maps, at pages [*] and [*], more particularly described as follows:
Commencing at the Southerly corner of said Parcel 2; thence along the
Southwesterly line of said Parcel 2 N. 52(degrees) 59' 50" W., 512.23 feet;
thence leaving said line, from a tangent that bears N. 74(degrees) 14' 29" E.,
along a curve to the left with a radius of 3520.00 feet, through an angle of
8(degrees) 03' 39", an arc length of 495.22 feet to the Northeasterly line of
said Parcel 2; thence along last said line S. 52(degrees) 59' 50" E., 240.02
feet to the Southeasterly line of said Parcel 2; thence along last said line S.
36(degrees) 50' 07" W., 414.00 feet to the point of commencement.
And Excerpting therefrom that portion of land as granted to the State of
California by Deed filed for record in the office of the Recorder for the County
of Santa Xxxxx on December 10, 1992 in Book M [*] at Page [*] Official Records,
and being more particularly described as follows:
Being a portion of Parcel 2, as shown on that certain Parcel Map filed for
record on November 16, 1982 in Book [*] of Maps at Pages [*] and [*], Santa
Xxxxx County Records, described as follows:
Beginning at the most Westerly corner of that certain 64.00 foot wide Parcel of
land shown as "[*] to be dedicated" on said Parcel Map; thence from said Point
of Beginning along the Southwesterly line of said 64.00 foot wide Parcel S.
52(degrees) 23' 23" E. 55.12 feet to the most Northerly corner of Parcel 3, as
shown on said Parcel Map; thence leaving said Southwesterly line along the
Northwesterly line of said Parcel 3 from a tangent bearing of S. 60(degrees) 26'
43" W. along a curve to the right with a radius of 3519.83 feet through a
central angle of 0(degrees) 25' 29" for an arc length of 26.09 feet to a point
in a line parallel with and distant Southwesterly 24.00 feet, measured at right
angles, from said Southwesterly line; thence along said parallel line N.
52(degrees) 23' 23" W. 44.91 feet to a point on the general Southwesterly line
of Parcel 1 as shown on said Parcel Map; thence leaving said parallel line along
said Southwesterly line N. 37(degrees) 36' 37" E. 24.00 feet to the point of
beginning.
*CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
Addendum to Lease
-----------------
This is an Addendum to the foregoing Lease dated June 10, 1999,
between ROSE VENTURES II, INC., a California Corporation, as Lessor, and
EQUINIX, INC., a California Corporation, as Lessee. The provisions of this
Addendum shall be in addition to and shall supersede and control any contrary
provisions of the foregoing Lease.
1. Rental Adjustments. The initial Base Rent of $[*] per month
------------------
shall commence on the Commencement Date and apply during Months 1 through 6.
Thereafter, said base rent shall be adjusted as follows:
a. $[*] per month for Months 7-12;
b. $[*] per month for Months 13-18;
c. $[*] per month for Months 19-24; and
d. For each 12-month period thereafter, monthly Base Rent shall
be adjusted upward by [*] percent ([*]%) of the monthly Base
Rent payable in the last month preceding each such 12-month
perio d.
2. Security Deposit. Upon execution hereof, Lessee shall deliver to
----------------
Lessor a $[*] irrevocable standby letter of credit to be held by Lessor as and
for a security deposit pursuant to paragraph 5 of the foregoing Lease. Said
letter of credit shall be in a standard form reasonably acceptable to Lessor.
Lessor may only draw upon said letter of credit to cure a monetary Breach by
Lessee which has not been timely cured by Lessee under this Lease. In the event
of any draw upon said letter of credit, Lessor shall provide to Lessee a written
accounting of the amount of such draw, the Breach to which it has been applied
and such Breach shall be deemed cured as of the date of such application,
provided that the full amount available originally under said Letter of Credit
is restored by Lessee within ten (10) business days after the date of such
accounting notice. Upon delivery of proof satisfactory to Lessor that Lessee has
constructed, or caused to be constructed, and has paid for, tenant improvements
for the building on the leased premises, as previously approved by Lessor,
costing at least $10,000,000.00 in the aggregate, then Lessee may pay Lessor
cash in the sum of $[*] to be held as the Security Deposit under paragraph 5 of
the foregoing Lease, and Lessor shall thereupon surrender the letter of credit
for cancellation.
3. Lessee Accepts Premises AS IS. Except as otherwise provided in
-----------------------------
paragraph 2.2 of the foregoing Lease, Lessee agrees to accept the leased
premises and all of the improvements thereon IN THEIR PRESENT "AS IS" CONDITION
ON THE DATE OF EXECUTION OF THIS LEASE, AND WITHOUT WARRANTY, EXPRESS OR
IMPLIED, FROM THE LESSOR. Lessee acknowledges the importance of, and takes
responsibility for, obtaining full and comprehensive inspections of the leased
premises and improvements thereon by competent, professional contractors,
inspectors and other experts, and affirms Lessee's decision to lease the same is
being made in reliance thereon, and not on any representations made by Lessor or
Lessor's agent.
4. Lessee-Owned Alterations and/or Utility Installations.
-----------------------------------------------------
Notwithstanding anything to the contrary contained in paragraphs 7.3 and 7.4 of
the foregoing Lease, all Lessee-installed equipment shall remain the property of
Lessee and owned by Lessee throughout the Lease term, and any option terms
thereafter exercised, and shall be deemed trade fixtures, even if affixed to the
leased premises, the building thereon, or the land surrounding said building. In
addition, all of the terms and conditions contained in Exhibit "A" hereto,
entitled "Special Tenant Requirements," hereby are consented to by Lessor and
made a part hereof by reference.
5. Use. In addition to the uses allowed under paragraph 6.1 of the
---
foregoing Lease, Lessee may use the leased premises for executive and general
office use, the installation, operation, modification and maintenance of
equipment and facilities in connection with the Lessee's telecommunications
businesses and any other legally permitted uses. Other uses allowable include
those further described in paragraph sections one (1) through one-point-ten
(1.10) on the attached Exhibit "A" entitled "Special Tenant Requirements,"
including but not limited to use of conduits, fiber entrances and risers, copper
entrances and risers, roof space for ancillary equipment, antenna pad and riser,
overhead space use, exterior lighting, floor loading capacity and other
associated rights, fire protection and drainage, non-exclusive use of wet,
waste, vent and drainage piping, and use of batteries.
6. Parking/Truck Access. Lessee shall be allowed one (1) on-site
--------------------
parking space for each 1,000 square feet of rentable space provided the same are
available on the site of the leased premises. Lessee shall also be provided
vehicular access for trucks delivering or removing equipment to and from the
building on the leased premises.
7. Compliance With Applicable Laws. Nothing contained in this
-------------------------------
Addendum or in Exhibit "A" hereto shall in any way limit or negate Lessee's
obligation to comply with laws in accordance with the terms of this Lease.
8. Expansion of Building. In the event Lessee needs additional
---------------------
space on the site, Lessor, at its expense, shall construct a building in the
existing parking area for Lessee. The building shall be in shell condition in
accordance with the appropriate building/zoning codes. The rent shall be the
rent Lessee is paying per square foot under the Lease in the year the building
is completed and during each lease year thereafter through the Lease Term under
the terms and conditions of the Lease.
*CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
9. Additional Revisions to Lease:
-----------------------------
Section Number Revisions to Section
-------------- --------------------
Par. 6.2(a) At the end of the fifth sentence (which begins
with "Notwithstanding the foregoing ..." the
following phrase is hereby inserted: "provided
that Lessee also may, without Lessor's prior
consent, but in compliance with all Applicable
Requirements, use any ordinary and customary
materials reasonably required to be used by Lessee
in the normal course of Lessee's business
permitted on the Premises even if such use
constitutes a Reportable Use."
Par. 6.2(b) In the first sentence, after the words "previously
consented to by Lessor," the following phrase is
hereby inserted: "(or other than as permitted by
the fifth sentence of Paragraph 6.2(a) above)."
Par. 6.2(d) Add to the end of this paragraph the following
sentences: "Lessor may not enter into any
settlement or other compromise with respect to any
claim covered by the indemnity set forth in this
section in which Lessee has expressly agreed to
indemnify and defend Lessor and is actively doing
so, without Lessee's prior written consent, which
shall not be unreasonably withheld, conditioned or
delayed, and if a claim is settled or compromised
without such consent, Lessee shall not be
obligated to provide indemnification under this
section. If Lessor or any other indemnified party
obtains recovery of any of the amounts that Lessee
has paid to them pursuant to the indemnity set
forth in this section, then Lessor or such other
indemnified party, as applicable, shall promptly
pay to Lessee the amount of such recovery."
Par. 7.3(b) Lessor shall not require a bond for alterations
unless such alterations exceed $250,000 and no
bonds will be required for Lessee's initial tenant
improvements.
Par. 8.3(a) Notwithstanding anything to the contrary in this
Lease, Lessee shall not be obligated to pay the
premium for any earthquake insurance carried by
Lessor on the Premises unless Lessor's lender
requires Lessor to maintain such earthquake
insurance. Lessor represents and warrants that its
current lender does not require such insurance
under its loan documents and Lessor agrees to use
its best faith efforts to not have any
modifications to the existing loan documents or
any future lender on the Premises require
earthquake insurance to be obtained by Lessor. If
Lessor's lender does require earthquake insurance
to be obtained on the Premises, Lessee agrees to
reimburse Lessor for the cost of the premium for
such earthquake insurance up to a maximum of
Twenty-Five Thousand Dollars ($25,000) per
calendar year in which such earthquake insurance
is required. Lessee shall reimburse Lessor for
Lessee's portion of any such earthquake insurance
premium within ten (10) business days of Lessor
providing Lessee with a written receipt of
Lessor's payment of such premium.
Par. 8.6 At the beginning of the first sentence, the phrase
"Notwithstanding any other provision of this Lease
and" is hereby inserted. At the end of the first
sentence the phrase "or actually insured by the
parties" is hereby inserted.
Par. 8.7 The opening clause of this paragraph is revised to
read as follows: "Except for the negligence and/or
willful misconduct of Lessor, its agents,
employees, contractors, and invitees, or Lessor's
breach of this Lease." Also, in the first
sentence, the phrase "involving, or in connection
with," is hereby deleted. Insert at the end of
this paragraph the following: "Lessor may not
enter into any settlement or other compromise with
respect to any claim covered by the indemnity set
forth in this section in which Lessee has
expressly agreed to indemnify and defend Lessor
and is actively doing so, without Lessee's prior
written consent, which shall not be unreasonably
withheld, conditioned or delayed, and if a claim
is settled or compromised without such consent,
Lessee shall not be obligated to provide
indemnification under this section. If Lessor or
any other indemnified party obtains recovery of
any of the amounts that Lessee has paid to them
pursuant to the indemnity set forth in this
section, then Lessor or such other indemnified
party, as applicable, shall promptly pay to Lessee
the amount of such recovery."
Par. 8.8 At the beginning of this paragraph, the phrase
"Except for the negligence and/or willful
misconduct of Lessor, its agents, employees,
employees, contractors, and invitees occurring
before the Start Date, or Lessor's breach of this
Lease," is hereby inserted.
Par. 9 Add the following to Paragraph 9: "In the event
Lessor elects to terminate this Lease pursuant to
this Xxxxxxxxx 0, Xxxxxx shall have the right,
within ten (10) days after receipt of such notice,
to agree in writing on a basis satisfactory to
Lessor to pay for the entire cost of repairing
such damage less only the amount of insurance
proceeds, if any, received by Lessor, in which
event the notice of termination shall be
ineffective and this Lease shall continue in full
force and effect, and Lessor shall proceed to make
such repairs as soon as reasonably possible. If
Lessee does not give such notice within such ten
(10) day period this Lease shall be terminated
pursuant to such notice of termination by Lessor."
Par. 10.l(b) In the first line, after the words "payment",
insert the words "more than 2 times during any
calendar year." Delete item (ii) and all
references to that option in the rest of this
paragraph.
Par. 12 The following provision is hereby added to this
paragraph: "Notwithstanding any other provision of
this Lease to the contrary, Lessee may grant a
security interest in its rights under this Lease
to the entity that provides the equipment
financing to Lessee. The entity holding the
security interest in this Lease as authorized
under this section may foreclose on such security
interest and transfer this Lease to the party
purchasing at the foreclosure, provided that
Lessor consents to such party as the new tenant
hereunder, which consent shall not be unreasonably
withheld or delayed. In addition, the entity that
provides the equipment financing to Lessee shall
have the right to enter the Premises for purposes
of inspecting its collateral and conducting a
foreclosure sale if Lessee defaults on such
financing. Lessor disclaims any right or title in
the equipment financed by Lessee, and such
equipment can be removed from the Premises at any
time, provided that Lessee repairs any damage
caused by such removal."
Par. 12.1(a) In the second line, Lessor shall not
unreasonably withhold or condition its
consent, and if Lessor does not respond to
Lessee's request for consent within fifteen
(15) days, Lessee shall give Lessor another
such request, and if Lessor does not respond
to Lessee's second request for consent within
ten (10) days following Lessee's request,
then Lessor shall be deemed to have consented
to the assignment.
Par. 12.3 This paragraph is hereby revised to provide
for a 50/50 split of any excess rent. In the
third line of this paragraph, after the word
"herein", insert the following: ", except
such terms and conditions shall not apply to
the transactions with Tenant's Customers as
set forth in Paragraph 8 of the Special
Tenant Requirements attached hereto as
Exhibit A to the Addendum."
Par. 17 In the event of a transfer by Lessor, Lessor
shall nevertheless be liable for its
indemnification obligations under the Lease
and any breach of the Lease existing as of
the date of the transfer, provided that
written notice of such indemnification
obligations for such breach has been given to
such Lessor before such transfer of title
occurs.
Par. 24 The provisions of the first sentence hereby
are made mutual to both Lessor and Lessee.
Par. 30 For the sole benefit of Lessee and as a
condition to the effectiveness of this Lease
(which may be waived solely by Lessee),
Lessor shall deliver to Lessee a draft non-
disturbance agreement on or before execution
of this Lease by Lessor and Lessee.
Par. 30.1 Add the following sentence to Paragraph 30.1:
"Any subordination agreement entered into by
Tenant pursuant to this Paragraph 30 must
provide that absent a Breach by Tenant under
this Lease or termination of this Lease, any
insurance proceeds associated with any damage
and destruction of the Premises shall be made
available for restoration of the Premises in
accordance with the provisions of Paragraph 9
of this Lease."
Par. 39.2 In recognition of the fact that Lessee
remains obligated for the performance of this
Lease following any "assignment," Lessee
shall have the right to transfer each Option
to any transferee under Paragraph 10 of the
Special Tenant Requirements attached to the
Addendum as Exhibit A.
Option(s) to Extend Paragraph A(iv) is hereby revised to make it
inapplicable to Extend any transfer pursuant
to Paragraph 10 of Exhibit A to the Addendum,
any agreements with the Customers as more
particularly provided in paragraph 12.3, and
the requirement that the Lessee be in full
possession at the time the Option is
exercised is hereby changed to a minimum of
50% possession.
Par. 7.1 of Exhibit A to Addendum Add the word "Equipment" after the word
"Antenna" in this paragraph.
This Addendum is executed concurrently with, and as a part of, the
foregoing Lease.
Lessor: Lessee:
------ ------
ROSE VENTURES II, INC. EQUINIX, INC.
a California Corporation a Delaware Corporation
By:_______________________ By:__________________________
Xxxxxxx X. Xxxxxxx
Its President Its:_________________________
By:__________________________
Its:_________________________
PAGE 16
Exhibit "A"
to ADDENDUM
Special Tenant Requirements
---------------------------
Landlord and Tenant hereby agree that, notwithstanding anything
contained in the Lease to the contrary, the provisions set forth below shall be
included as part of the Lease and shall supersede any inconsistent provisions of
the Lease. All references in this Exhibit to the Lease shall be construed to
mean the Lease and all exhibits thereto, as amended and supplemented by the
Exhibit. All terms not otherwise defined in the Exhibit shall have the same
meanings as set forth in the Lease.
1. Use.
---
1.1 Tenant's Use of Premises and Building and Land. Tenant is
----------------------------------------------
permitted (a) to construct, maintain, operate and repair electronic,
transmitting and receiving equipment and supporting structures on the Premises,
including the roof of the Building, (b) to construct, maintain, operate and
repair an equipment room on the Premises, including the construction of an
upgraded fire suppression system, (c) to install, upgrade, maintain, operate,
and repair utility lines, transmission lines, and telecommunications conduit and
cabling (collectively, the "Conduits") in such locations on the Building and
Land as set forth in plans and specifications, which shall be subject to
Landlord's approval which shall not be unreasonably withheld, conditioned or
delayed, (d) reasonable ingress and egress over existing roadways on the Land
for Tenant's trucks and other vehicles, to maintain Tenant's equipment and the
Conduits (collectively, "Equipment"). The Equipment shall include, without
limitation, the antenna, batteries, uninterruptable power supply and such other
equipment, necessary thereto and more particularly as set forth hereafter.
Tenant shall have access to and use of the Premises, the Building and Land and
the Conduits, 24 hours per day, 365 days per year.
1.2 Tenant's Use of Conduit Ducts. Tenant shall have the
-----------------------------
right to install, maintain, operate and repair the Conduits in any of Landlord's
conduit ducts located on the Building and Land, so long as Tenant's use of the
Conduits does not interfere with Landlord's use of Landlord's conduit ducts
located on the Building and Land. If required by any service provider to the
Building or by Landlord, Tenant shall install separate conduits where
applicable.
1.2.1 Fiber Entrances and Risers. Tenant shall have the
--------------------------
right to install, maintain, operate, augment and repair the Conduits in any of
Landlord's conduit ducts located on the Property, so long as Tenant's use of the
Conduits does not interfere with Landlord's use of Landlord's conduit ducts
located on the Property. At a minimum Tenant shall have the right to utilize two
utility entrances within the Building and the right to install from these dual,
diverse entrances eight (8), exclusive, four (4") inch conduits for a total of
sixteen conduit ducts to the Leased Premises.
1.2.2 Copper Entrances and Risers. Tenant shall have the
---------------------------
right to install, maintain, operate, augment and repair the conduit ducts and
risers from the existing copper telephone point of entry to Tenant's Leased
Premises.
1.3 Roof Space for Ancillary Equipment. Tenant shall have the
----------------------------------
right as part of their Lease interest in the Building or Land to utilize space
on the Roof or other space as required and approved in advance by Landlord, for
the purpose of installing and maintaining equipment used in conjunction with
Tenant's use of the Premises. Tenant's use of such space shall be exclusive in
nature and Tenant shall have the right to accrue such space and equipment from
others. Tenant's use of this space shall be in conjunction with the Leased
Premises.
1.4 Antenna Pad and Riser. Tenant shall have the right as
---------------------
part of their Lease interest in the Building or Land to utilize space on the
Roof or other space as required and approved in advance by Landlord, for the
purpose of installing and maintaining equipment used in conjunction with
Tenant's use of the Premises. Tenant's use of such space shall be exclusive in
nature and Tenant shall have the right to accrue such space and equipment from
others. Tenant's use of this space shall be in conjunction with the Leased
Premises.
1.5 Overhead Space Use. Tenant shall have the right to
------------------
utilize all space from above seven (7") feet to the bottom of any beam
("Overhead Space") for any of Tenant's equipment. Utilization of this space is
at Tenant's sole discretion. Tenant may also elect, to relocate any existing
piping, ventilation, sprinkler, waste, drainage or any and all other piping,
collectively ("Piping") from this Overhead Space. Relocation of such Piping will
be at Tenant's sole cost and expense and approved in advance by Landlord.
Landlord approval of such relocation may not be unreasonably withheld.
PAGE 17
1.6 Exterior Lighting. Tenant shall have the right to install,
-----------------
maintain, operate, augment and repair exterior lighting at the Building. Tenant
will do so at Tenant's sole cost and expense and within governmental boundaries.
1.7 Floor Loading Capacity and Augmentation, Ceiling and Access
-----------------------------------------------------------
to Space Above and Below - Tenant shall have the right to install and augment
------------------------
existing floor and ceiling loading capacity of the Tenant's Premises, including
but not limited to work necessary to complete this task within Tenant's
Premises. Such augmentation of floor and ceiling loading shall be at Tenant's
sole cost and expense and subject to Landlord's reasonable approval of plans for
such installation or augmentation.
1.8 Fire Protection and Drainage - Tenant shall have the right
----------------------------
to install, maintain, augment and operate a separate Gas Fire Protection System
("Gas Fire Protection System") on the Premises. Such Gas Fire Protection System
shall be in addition to any existing system on the Premises, shall be installed
at Tenant's sole cost and expense, and shall meet all Local, State and Federal
Governmental regulation. Further, if a Water-based Fire Protection System
("Water-based Fire Protection System") exists on the Property, Tenant shall have
the right to augment the current system, at Tenant's sole costs and expense, to
operate as a Pro-action, Dry Pipe, Water-based Fire Protection System. Tenant
shall have the to install, operate, maintain, a new Water-based Fire Protection
System, at Tenant's sole cost and expense, in any space adjacent, below or above
Tenant's Premises or any where on the (Property, Building or Land), and Tenant
shall have the right to augment or repair the existing Water-based Fire
Protection System any where on the (Property, Building or Land). Additionally,
Tenant reserves the right to install, operate, maintain, repair and augment, at
Tenant's sole cost and expense, drainage, existing or new, within Tenant's
Premises or any where on the (Property, Building or Land) that would be
necessary to divert water from the Water-based Fire Protection System from
Tenant's Premises.
1.9 Non-exclusive Use of Wet, Waste Vent and Drainage piping -
--------------------------------------------------------
Tenant shall have the right to install, maintain, augment and operate on the
Premises any and all piping necessary and customary for utilizing water, waste,
vent and drainage. Further, Landlord agrees that Tenant shall have the right to
a non-exclusive easement for the installation of such piping in common areas or
through others space as deemed necessary and appropriate for Tenant use of
water, waste, vent and drainage.
1.10 Battery - Tenant shall have the right to install, maintain,
-------
and operate on the Premises a battery power plant ("Battery Power Plant"). Such
battery power plant shall be for the sole use of Tenant and for the operations
of the Premises for Tenant's intended use. The installation and operation of the
Battery Power Plant shall be a Tenant's sole cost and expense and shall meet all
Local, State and Federal Governmental requirements.
2. HVAC, Special Requirement and Rights. Landlord understands that
------------------------------------
Tenant's intended use of the HVAC property involve special requirements for the
heating, cooling and ventilation ("HVAC") of the Premises. Therefore, in
addition to the existing heating, cooling and ventilation located at the
Building, at Tenant's option, instead of, the HVAC utilities supplied to the
Premises by Landlord. Tenant shall have the right at Tenant's option, to install
in the Premises or elsewhere on the Property, in such location as reasonably
approved by Landlord, a separate self-contained twenty-four (24) hour a day
heating, ventilation and air-conditioning HVAC unit ("Tenant's HVAC Unit")
subject to Landlord's prior approval of the plans and specifications for the
work and electrical requirements of Tenant's HVAC Unit, which approval shall not
be unreasonably withheld, conditioned, or delayed. Tenant shall pay all costs of
electrical power for such unit in the manner set forth in above.
3. Compliance With Law. Nothing contained in this Exhibit shall
-------------------
in any way limit or negate Tenant's obligation to comply with laws in accordance
with the terms of the Lease.
4. Initial Installation and Testing. Tenant shall have the right,
--------------------------------
at Tenant's sole cost and expense, at any time following the execution of this
Lease by Tenant in a form mutually acceptable to Landlord and Tenant, to enter
upon the Building and Land and to carry out any tests, inspections, pre-
installation and installation activities on the Building and Land as necessary
for the construction and installation of the Equipment, including without
limitation, engineering and environmental surveys, physical inspections, soil
test borings, and underground trenching. Immediately following the completion of
such tests, inspections or pre-installation activities, Tenant shall, at
Tenant's sole coat and expense, repair any damage to the Building and Land
caused by such inspections or pre-installation activities, including repaving
and re-landscaping any affected areas of the Building and Land. Any such entry
onto the Building and Land prior to the Commencement Date of the Lease shall be
on all of the terms and provisions of the Lease, except for Tenant's obligation
to pay rent.
PAGE 18
5. Equipment Ownership; Surrender. The Equipment shall be the
------------------------------
property of and owned by Tenant throughout the Lease Term, and shall in all
event be deemed trade fixtures, even if affixed to the Premises or Building or
Land. On or before the Expiration Date or earlier termination of this Lease.
Tenant shall remove its Equipment from the Premises and Building and Land.
Landlord hereby expressly waives and releases any and all contractual liens and
security interest or constitutional and/or statutory liens and security
interests arising by operation of law or under the Lease to which Landlord might
now or hereafter be entitled on any of the Equipment, Tenant's HVAC Unit or
Tenant's Generator. Landlord further agrees that the Equipment, Tenant's HVAC
Unit, and Tenant's Generator shall be exempt from execution, foreclosure, sale,
levy, attachment, for any Tenant default hereunder, and that the Equipment,
Tenant's HVAC Unit, and Tenant's Generator may be removed at any time from the
Premises or the Building and Land by Tenant.
6. Utilities; Emergency Power Generator. Tenant shall have the
------------------------------------
right, at any time during the Lease Term, at Tenant's option and at Tenant's
sole cost and expense: (a) install an emergency power generator(s) ("Tenant's
Generator") on the Premises or elsewhere on the Land, as noted in Exhibit A, in
such location as reasonably approved by Landlord, to provide back-up emergency
power for the Equipment and for Tenant's HVAC Unit, and (b) store fuel above
ground, on the Premises or elsewhere on the Land, as noted in Exhibit A, in such
locations as reasonably approved by Landlord, in such amounts as Tenant
reasonably determines necessary for Tenant's Generator.
7. No Interference; Relocation.
---------------------------
7.1 No Interference. Neither Landlord nor any of Landlord's
---------------
agents, employees, or contractors (collectively, the "Landlord Parties") shall
interfere in any way with the Equipment or with Tenant's access to the Equipment
and Antennas, the Conduits, Tenant's HVAC Unit, or Tenant's Generator (the
"Interference"). Landlord agrees that prior to carrying out any construction,
maintenance or repair activities which are in the vicinity of the Premises, the
Antennas, the Conduits, Tenant's HVAC Unit, or Tenant's Generator (if such are
not located within the Premises), Landlord shall provide three (3) days' prior
written notice of Landlord's or Landlord Parties' intent to carry out such
construction, maintenance or repair work including the date, time and location
in which such work will take place. Tenant shall have the right to monitor and
inspect such work at Tenant's own risk, and at Tenant`s sole cost and expense.
Landlord and Landlord Parties shall exercise all due care in carrying out such
work. Landlord shall use reasonable efforts to immediately notify the Tenant's
designated contact person by telephone or facsimile in the event of fire, power
failure, bomb threats, or other unplanned events which could adversely impact
Tenant's operations.
7.2 Remedies. Upon written notice from Tenant, stating with
--------
specificity that Landlord or one or more of the Landlord Parties is creating an
Interference in violation of Section 7.1 above, Landlord shall take immediately
all necessary measures at Landlord's sole cost and expense to eliminate the
Interference, including hiring agents to work extended hours, until the
Interference is eliminated. If Landlord does not eliminate the Interference,
Tenant shall have the right, at Tenant's option, in addition to any other remedy
at law or in equity, to (a) eliminate the Interference, and deduct the cost of
eliminating the Interference from the Base Rent next due, (b) obtain injunctive
relief enjoining or restraining whatever Interference may have occurred or be
occurring, without posting a bond or other security and without proving damages,
it being expressly recognized by Landlord that any Interference will cause
irreparable harm to Tenant which cannot be fully compensable by damages, or (c)
immediately terminate this Lease, in which event, this Lease shall be of no
further force and effect and Tenant shall have no further obligations hereunder.
7.3 Relocation. In no event shall Landlord relocate Tenant or
----------
the Equipment to other premises, or require Tenant to relocate its Equipment for
any length of time to any other location, either in or on the Building or Land
or elsewhere.
8. Customer Equipment. Landlord acknowledges that Tenant's
------------------
business to be conducted on the Premises requires the installation of certain
communications equipment by certain licensees and customers of Tenant
(collectively, "Customers") in order for such Customers to interconnect with
Tenant's terminal facilities or to permit Tenant to manage or operate such
Customers' equipment, or otherwise as may be required pursuant to applicable
statutes and regulations. These contracts or licenses with the Customers shall
not be deemed subject to the Assignment and Sublease section of the Lease and
these Customer contracts or licenses do hereby have the Landlord's consent at no
consideration to Landlord for the limited purpose of permitting the services and
uses described above.
9. Sound Control. Tenant is responsible for taking the necessary
-------------
measures to reduce the sound transmissions caused by the Equipment. In addition,
Tenant's Generator shall be installed in a weatherproof, walk-around type, sound
attenuating enclosure which shall limit the sound
PAGE 19
to no more than 85 dBA as measured at three (3) feet from any side, top to
bottom, under all operating conditions.
10. Transferability. Without Landlord's prior consent to
---------------
consideration to Landlord but with notice to Landlord, Tenant shall have the
right to assign the Lease to any affiliate, division or corporation,
controlling, controlled by or under common control with Tenant or a successor
entity related to Tenant by merger, consolidation, nonbankruptcy reorganization
or governmental action, or a purchaser of substantially all of Tenant's assets
located at the premises. For purposes of the Lease, the sale of the Tenant's
capital stock through any public exchange or any issuance for purposes of
raising financing shall not be deemed an assignment or any other transfer of the
Lease or the Premises.
11. Confidentiality. Landlord shall keep all Confidential
---------------
Information of Tenant confidential. For the purposes of this Lease,
"Confidential Information" includes any data or information pertaining to Tenant
or Tenant's business, regardless of medium, that is provided by Tenant to
Landlord, including Tenant's plans and specifications or electrical power
requirements, site plans, or copies of any such information, but excludes any
information (a) approved in writing by Tenant for release to third parties, (b)
that Landlord possesses independently of Tenant, or (c) that Tenant places in
the public domain.
12. Condition at Surrender. On or before Lease termination and
----------------------
Tenant's surrender of the Premises to Landlord, Tenant shall remove all of its
equipment, personal property and any of the special tenant improvement
installations set forth in this Exhibit, for which Landlord notifies Tenant in
writing that they are to be removed at Lease termination when Landlord approves
the plans for the improvements. Tenant shall repair and restore the Premises
from any damages caused by the removal of any equipment, personal property or
tenant improvements.
PAGE 20
