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EXHIBIT 10.22
SUBLEASE
This Sublease is made and entered into as of December 4, 1998, by and
between Classifieds2000, Inc. ("Sublandlord"), and General Magic, Inc.
("Subtenant"), under the Master Lease dated February 20, 1998, between Aetna
Life Insurance Company, as "Lessor", and Sublandlord as "Lessee." A copy of the
Master Lease is attached hereto as Attachment I and incorporated herein by this
reference. All capitalized terms not otherwise defined in this Sublease shall
have the meanings set forth in the Master Lease.
1. Provisions Constituting Sublease.
1.1 Master Lease. This Sublease is subject to all of the terms and
conditions of the Master Lease. Subtenant hereby assumes and agrees to perform
all of the obligations of "Lessee" under the Master Lease to the extent said
obligations apply to the Subleased Premises and Subtenant's use of the Common
Areas, except as specifically set forth herein. Subtenant shall not commit or
permit to be committed on the Subleased Premises or on any other portion of the
Project any act or omission which violates any term or condition of the Master
Lease. Except to the extent waived or consented to in writing by the other party
or parties hereto who are affected thereby, neither of the parties hereto will,
by renegotiation of the Master Lease, assignment, subletting, default or any
other voluntary action, avoid or seek to avoid the observance or performance of
the terms to be observed or performed hereunder by such party, but will at all
times in good faith assist in carrying out all the terms of this Sublease and in
taking all such action as may be necessary or appropriate to protect the rights
of the other party or parties who are affected thereby against impairment.
Nothing contained in this Section 1.1 or elsewhere in this Sublease shall
prevent or prohibit Sublandlord (a) from exercising its right to terminate the
Master Lease pursuant to the terms thereof, or (b) from assigning its interest
in this Sublease.
1.2 Incorporation of Terms. All of the terms and conditions contained
in the Master Lease are incorporated herein, except as specifically provided
below, and the terms and conditions specifically set forth in this Sublease,
shall constitute the complete terms and conditions of this Sublease.
Notwithstanding the foregoing, (a) Subtenant shall be required to pay Base Rent
under this Sublease only in the amounts set forth in the Sublease, (b)
Sublandlord shall be responsible for the delivery of its Security Deposit and
the Letter of Credit to Landlord and Subtenant shall have no responsibility
therefor, and (c) Exhibits B and B-1 of the Master Lease shall not apply to this
Sublease.
2. Subleased Premises and Rent.
2.1 Subleased Premises. Sublandlord hereby leases to Subtenant and
hereby Subtenant leases from Sublandlord the Subleased Premises upon all of the
terms, covenants and conditions contained in this Sublease. The Subleased
Premises consist of the entire Premises described in Exhibit A of the Master
Lease, which Premises consist of approximately 20,000 square feet and are
located at 000 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxx.
2.2 Base Rent. Without deductions, offset, prior notice or demand,
Subtenant shall pay to Sublandlord Base Rent for the Subleased premises
according to the following schedule:
MONTHS RENT PER MONTH
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1-12 $36,000.00
13-24 $37,000.00
25-36 $38,000.00
37-48 $39,000.00
49-53 $40,000.00
2.3 Additional Rent. This Sublease is intended to be a triple-net
lease. In addition to the Base Rent specified above, Subtenant shall pay to
Sublandlord all costs and expenses which are Sublandlord's obligations under the
Master Lease in connection with the operation, maintenance and management of the
Subleased Premises and accruing during the Sublease Term, including without
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limitation, real estate taxes, insurance, common area maintenance, roof
preventive maintenance, HVAC maintenance and management fees (collectively,
"Additional Rent"). Subtenant shall pay Additional Rent according to the
estimate of monthly Additional Rent submitted by Lessor to Sublandlord, and
Subtenant shall have Sublandlord's rights and obligations under the Master Lease
arising from any difference between the estimated Additional Rent paid to Lessor
and the actual Additional Rent due to Lessor each year.
2.4 General Payment Terms. The Base Rent and Additional Rent are
referred to herein as the "Rent." Rent shall be payable by Subtenant to
Sublandlord in consecutive monthly installments on or before the first day of
each calendar month during the Sublease Term (as defined in Section 4.1). If the
Sublease commencement date or termination date occurs on a date other than the
first day or the last day, respectively, of a calendar month, then the Rent for
such partial month shall be prorated and the prorated Rent shall be payable on
the Sublease commencement date or on the first day of the calendar month in
which the Sublease termination date occurs, respectively.
2.5 Security Deposit. Subtenant shall pay to Sublandlord as a
non-interest bearing Security Deposit the sum of One Hundred Seventeen Thousand
Dollars ($117,000.00). In the event Subtenant has performed all of the terms and
conditions of this Sublease during the term hereof, Sublandlord shall return to
Subtenant, within ten days after Subtenant has vacated the Subleased Premises,
the Security Deposit less any sums due and owing to Sublandlord.
3. Use.
Subtenant shall use the Subleased Premises only for general software
development purposes, office and other legally related uses, unless Sublandlord
and Master Landlord consent in writing to other uses prior to the commencement
thereof.
4. Sublease Term.
4.1 Sublease Term. The term of this Sublease (the "Sublease Term")
shall be for the period commencing December 4, 1998 and continuing through March
31, 2003. In no event shall the Sublease Term extend beyond the Term of the
Master Lease.
4.2 Inability to Deliver Possession. In the event Sublandlord is unable
to deliver possession of the Subleased Premises at the commencement of the
Sublease Term, Sublandlord shall not be liable for any damage caused thereby,
nor shall this Sublease be void or voidable but Subtenant shall not be liable
for Rent until such time as Sublandlord offers to deliver possession of the
Subleased Premises to Subtenant, but the Sublease Term shall not be extended by
such delay. If Subtenant, with Sublandlord's consent, takes possession prior to
commencement of the Sublease Term, Subtenant shall do so subject to all the
covenants and conditions hereof and shall pay Rent for the period ending with
the commencement of the Term at the same rental as that prescribed for the first
month of the Term prorated at the rate of 1/30th thereof per day. In the event
Sublandlord has been unable to deliver possession of the Subleased Premises
within 30 days from the commencement date, Subtenant, at Subtenant's option, may
terminate this Sublease.
5. Building Condition.
Subtenant accepts the Subleased Premises "as is", except that
Sublandlord shall cause the HVAC, electrical, plumbing and lighting serving the
Subleased Premises to be in good working order on the date this Sublease
commences.
6. Notices.
All notices, demands, consents and approvals which may or are required
to be given by either party to the other hereunder shall be given in the manner
provided in the Master Lease, at the addresses shown on the signature page
hereof. Sublandlord shall notify Subtenant of any Event of Default under the
Master Lease, or of any other event of which Sublandlord has actual knowledge
which will impair Subtenant's ability to conduct its normal business at the
Subleased Premises, as soon as reasonably
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practicable following Sublandlord's receipt of notice from the Landlord of an
Event of Default or actual knowledge of such impairment. If Sublandlord elects
to terminate the Master Lease, Sublandlord shall so notify Subtenant by giving
at lease 90 days notice prior to the effective date of such termination.
7. Broker Fee.
Upon execution of the Sublease, Sublandlord shall pay Cornish & Xxxxx
Commercial, a licensed real estate broker ("Broker"), fees set forth in a
separate agreement between Sublandlord and Broker.
8. Compliance With Americans With Disabilities Act.
Subtenant shall be responsible for the installation and cost of any and
all improvements, alterations or other work required on or to the Subleased
Premises or to any other portion of the Project which are required or reasonably
necessary because of: (a) Subtenant's particular use of the Subleased Premises
or any portion thereof; (b) the particular use by a subtenant by reason of
assignment or sublease; or (c) both, including any improvements, alterations or
other work required under the Americans With Disabilities Act of 1990. Prior to
any construction of improvements or alterations to the Subleased Premises,
Subtenant shall obtain Sublandlord's and Lessor's approval of the improvement or
alteration plans and its general contractor. Compliance with the provisions of
this Section 8 shall be a condition of Sublandlord granting its consent to any
assignment or Sublease of all or a portion of this Sublease and the Subleased
Premises described in this Sublease.
9. Compliance With Nondiscrimination Regulations.
It is understood that it is illegal for Sublandlord to refuse to
display or sublease the Subleased Premises, or to assign, surrender or sell the
Master Lease, to any person because of race, color, religion, national origin,
sex, sexual orientation, marital status or disability.
10. Toxic Contamination Disclosure.
Sublandlord and Subtenant each acknowledge that they have been advised
that numerous federal, state, and/or local laws, ordinances and regulations
("Laws") affect the existence and removal, storage, disposal, leakage of and
contamination by materials designated as hazardous or toxic ("Toxics"). Many
materials, some utilized in everyday business activities and property
maintenance, are designated as hazardous or toxic.
Some of the Laws require that Toxics be removed or cleaned up by
landowners, future landowners or former landowner without regard to whether the
party required to pay for "clean up" caused the contamination, owned the
property at the time the contamination occurred or even knew about the
contamination. Some items, such as asbestos or PCBs, which were legal when
installed, now are classified as Toxics, and are subject to removal
requirements. Civil lawsuits for damages resulting from Toxics may be filed by
third parties in certain circumstances.
Sublandlord and Subtenant each acknowledge that Broker has no specific
expertise with respect to environmental assessment or physical condition of the
Subleased Premises, including, but not limited to, matters relating to: (a)
problems which may be posed by the presence or disposal of hazardous or toxic
substances on or from the Subleased Premises, (b) problems which may be posed by
the Subleased Premises being within the Special Studies Zone as designated under
the Xxxxxxx-Xxxxxx Special Studies Zone Act (Earthquake Zones), Section
2621-2630, inclusive of California Public Resources Code, and (c) problems which
may be posed by the Subleased Premises being within a HUD Flood Zone as set
forth in the U.S. Department of Housing and Urban Development "Special Flood
Zone Area Maps," as applicable.
Sublandlord and Subtenant each acknowledge that Broker has not made an
independent investigation or determination of the physical or environmental
condition of the Subleased Premises, including, but not limited to, the
existence or nonexistence of any underground tanks, sumps, piping, toxic or
hazardous substances on the Subleased Premises. Subtenant agrees that it will
rely solely upon its own
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investigation and/or the investigation of professionals retained by it or
Sublandlord, and neither Sublandlord nor Subtenant shall rely upon Broker to
determine the physical and environmental condition of the Subleased Premises or
to determine whether, to what extent or in what manner, such condition must be
disclosed to potential sublessees, assignees, purchasers or other interested
parties.
11. Rent Abatement and Damages to Personal Property
In the event Sublandlord, pursuant to the terms of the Master Lease, is
entitled to and receives rent abatement, then to the extent such rent abatement
affects the subleased premises, Subtenant shall be entitled to rent abatement in
an amount that the net rentable area of the Subleased Premises bears to the
total net rentable area of the Master Lease, and only to the extent any such
abatement applies to the Sublease Term. In addition, any amounts paid or
credited to Sublandlord under the terms of the Master Lease for damage to
personal property shall be credited to Subtenant, subject to the same
limitations set forth above.
12. Signage.
Subtenant may install a sign on the monument sign subject to prior
approval by the Lessor and the City of Sunnyvale.
13. Assignment of Rent.
Sublandlord and Subtenant agree that until a default shall occur in the
performance of Sublandlord's obligations under the Master Lease, Sublandlord
shall have a license to receive, collect and enjoy the rentals and other sums
due Sublandlord under the Sublease. However, said license shall automatically
terminate without notice to Sublandlord upon the occurrence of a default by
Sublandlord in the performance of its obligations under the Master Lease and
Lessor may thereafter, at its option, receive and collect, directly from
Subtenant, all rentals and other sums due or to be due Sublandlord under the
Sublease. Lessor shall not, by reason of the assignment of all rentals and other
sums due Sublandlord under the Sublease nor by reason of the collection of said
rentals or other sums from the Subtenant, (a) be bound by or become a party to
the Sublease, (b) be deemed to have accepted the attornment of Subtenant, or (c)
be deemed liable to Subtenant for any failure of Sublandlord to perform and
comply with Sublandlord's obligations under the Sublease. Sublandlord hereby
irrevocably authorizes and directs Subtenant, upon receipt of any written notice
from Lessor stating that a default exists in the performance of Sublandlord's
obligations under the Master Lease, to pay directly to Lessor the rents and
other income due and to become due under the Sublease. Sublandlord agrees that
Subtenant shall have the right to rely solely upon such notice from Lessor
notwithstanding any conflicting demand by Sublandlord or any other party.
Sublandlord hereby agrees to indemnify, defend and hold Subtenant harmless from
any and all claims, losses, liabilities, judgements, costs, demands, causes of
action and expenses (including, without limitation, attorneys' fees and
consultants' fees) (collectively, "Claims") which Subtenant may incur in relying
on any written notice form Lessor and/or paying rent and other sums due under
the Sublease directly to Landlord in accordance with this Section 13.
Alterations
Sublandlord and Subtenant hereby consent to the proposed alterations described
in Exhibit A attached hereto and incorporated herein by this reference.
Sublandlord: CLASSIFIEDS2000, INC.
By: /s/ [SIGNATURE ILLEGIBLE] Date: December 8, 1998
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Its: General Counsel, Corporate Secretary
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Subtenant: GENERAL MAGIC, INC.
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By: /s/ XXXXX X. XxXXXXXXX Date: December 8, 1998
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Its: Senior Vice President, Finance
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NOTICE TO SUBLANDLORD AND SUBTENANT: CORNISH & XXXXX COMMERCIAL IS NOT
AUTHORIZED TO GIVE LEGAL OR TAX ADVICE; NOTHING CONTAINED IN THIS SUBLEASE OR
ANY DISCUSSIONS BETWEEN CORNISH & XXXXX AND SUBLANDLORD AND SUBTENANT SHALL BE
DEEMED TO BE A REPRESENTATION OR RECOMMENDATION BY CORNISH & XXXXX COMMERCIAL,
OR ITS AGENTS OR EMPLOYEES AS TO THE LEGAL EFFECT OR TAX CONSEQUENCES OF THIS
DOCUMENT OR ANY TRANSACTION RELATING THERETO. ALL PARTIES ARE ENCOURAGED TO
CONSULT WITH THEIR INDEPENDENT FINANCIAL CONSULTANTS AND/OR ATTORNEYS REGARDING
THE TRANSACTION CONTEMPLATED BY THIS PROPOSAL.
MASTER LANDLORD CONSENT
The undersigned, Lessor under the Master Lease attached as Attachment I, hereby
consents to the subletting of the Subleased Premises described herein on the
terms and conditions contained in this Sublease. This Consent shall apply only
to this Sublease and shall not be deemed to be a consent to any other Sublease.
Landlord: AETNA LIFE INSURANCE COMPANY
By: _____________________ Date: ____________________
Its: ____________________
ATTORNMENT AGREEMENT
Subtenant shall attorn to Lessor and perform all of Subtenant's obligations
under the Sublease directly to Lessor as if Lessor were the Sublandlord under
the Sublease. If Subtenant is not, at the time of the notice, in default, Lessor
shall continue to recognize the estate of Subtenant created under the Sublease.
If Subtenant is not in default, the Sublease shall continue with the same force
and effect as if Lessor and Subtenant had entered into a lease on the same
provisions as those contained in the Sublease, including, without limitation,
Subtenant's right to extend the term of the Lease.
Subtenant: GENERAL MAGIC, INC.
By: /s/ XXXXX X. XxXXXXXXX Date: December 8, 1998
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Its: Senior Vice President, Finance
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