1
EXHIBIT 10.13
OCCUPANCY LICENSE AGREEMENT
THIS OCCUPANCY LICENSE AGREEMENT ("Agreement") is made effective as of
November 12, 1998, by and between ADAPTEC, INC., a Delaware corporation
("Licensor"), and JAYCOR NETWORKS INC., a Delaware corporation ("Licensee"), in
the context of the following facts and circumstances:
A. Pursuant to the Asset Acquisition Agreement entered into by and
between Licensor and Licensee dated November 12, 1998, (the "Asset Acquisition
Agreement"), Licensor has agreed to sell, and Licensee has agreed to purchase,
the "Tangible Assets" (as such term is defined in the Asset Acquisition
Agreement).
B. Pursuant to the terms of that certain Office Building Lease ("Lease")
entered into between Licensor, as tenant, and CEP Investments, L.P., as
successor in interest to Vision Pharmaceuticals L.P. ("Master Lessor"), Licensor
currently leases approximately 84,971 square feet (the "Premises") of that
certain building located at 0000 Xxxxxxxx Xxxx, Xxxxxx, Xxxxxxxxxx 00000 (the
"Building"). This Agreement is contingent upon the approval of the Master
Lessor as detailed in the Master Lease.
C. Licensor and Licensee are desirous of entering into a short-term
occupancy arrangement for the use by Licensee of a portion of the Premises until
such time as operations conducted therein by Licensee have been relocated.
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties agree as follows:
1. LICENSE AREA AND LOCATION. Licensor hereby grants to Licensee a
non-assignable, non-transferable right and license for the use of that certain
area (the "License Area") consisting of approximately 6,179 rentable square feet
of space as shown on the attached Exhibit A. Licensee hereby acknowledges and
agrees that this right of use is a license only and not a leasehold interest and
that Licensee shall not be entitled to any actions, claims, defenses, unlawful
detainer protections, or other rights afforded to lessees, tenants, or "parties
in possession" under applicable law.
2. AGREEMENT SUBORDINATE. This Agreement is subordinate and subject to
all of the terms and conditions of the Master Lease. If the Master Lease
terminates for any reason whatsoever, this Agreement shall terminate
concurrently, and the parties hereto shall be relieved of any liability
thereafter accruing under this Agreement, except for the liabilities of the
parties which by the terms of this Agreement survive the expiration or earlier
termination of this Agreement.
1
2
3. TERM. The term of this Agreement (the "License Term") will commence
as of the date of the Asset Acquisition Agreement (the "Commencement Date"), and
will continue for a period of three (3) months (the "Termination Date");
provided, however, Licensee may elect to extend the License Term for one (1)
additional month by delivering written notice to Licensor no later than January
1, 1999. Notwithstanding the foregoing, the License Term may be sooner
terminated pursuant to the following provisions:
(a) Licensor may terminate this Agreement for cause by giving
three (3) days written notice to Licensee. As used herein, "cause" means any of
the following: (i) Licensee is in material breach of a material obligation under
this Agreement, and Licensee has failed to correct such breach within fourteen
(14) days after written notice from Licensor; or (ii) Licensee causes or permits
hazardous materials or toxic substances to be used or handled in violation of
Paragraph 6 below; or (iii) the License Area is damaged or destroyed by a fire
or other casualty that makes it impracticable for Licensor to continue to allow
Licensee to occupy the License Area.
On or before the Termination Date, Licensee shall completely remove all
of its personal property and vacate the License Area, leaving all of the
Furnishings therein in the same condition as received.
4. LICENSE FEE. For the use of the License Area, as well as for the use
of the Furnishings, the Common Facilities, and the Services provided by Licensor
as described below, Licensee shall pay to Licensor a fee (the "License Fee") in
the amount of $36.00 per rentable square foot per year, payable in monthly
installments in the amount of $18,537.00, due on the first day of each calendar
month, in such manner and at such address as Licensor shall designate. For any
partial month at the beginning or end of the License Term, the monthly License
Fee will be prorated. A late charge of $400.00 will be assessed if the License
Fee is not paid by the 5th day of the month.
5. IMPROVEMENTS AND FURNISHINGS. Licensor will provide offices, cubicles
and lab space within the License Area, based on Licensor's building standard
specifications, pursuant to the floor plan shown in Exhibit A. Licensor will
also furnish the License Area with Licensor's standard furniture, such as basic
desks, chairs, tables, bookshelves, and filing cabinets as currently provided.
Unless otherwise agreed in the Asset Acquisition Agreement, such improvements
and furnishings (collectively, the "Furnishings") shall at all times remain
Licensor's property. Licensee shall not make any alterations or modifications to
or upon the License Area or any of the Furnishings (including without limitation
any painting, wall hangings or signage), or add to, delete from or relocate any
of the same, without Licensor's prior written approval which may be withheld in
Licensor's sole and absolute discretion. If Licensor does grant approval for any
such alterations or modifications, Licensee will be required to use Licensor's
established vendors for the performance of such work.
2
3
6. USE. Licensee will use the License Area during the License Term only
for general office purposes, research and development, light manufacturing, and
sales, and for no other purpose without Licensor's prior written approval which
may be withheld in Licensor's sole and absolute discretion. Such use shall be in
strict compliance with the terms of the Master Lease. Except for small
quantities of products used in normal office environments (e.g., toner,
white-out), Licensee shall not cause or permit any hazardous materials or toxic
substances to be used, stored, generated, discharged, treated, handled,
transported to or from, or released in, on, or about the License Area or the
Premises, without the prior written consent of Licensor which consent may be
withheld in the sole and absolute discretion of Licensor.
7. COMMON FACILITIES. During the License Term, Licensee and its
employees shall be entitled to use, in Common with Licensor's employees,
contractors, agents, invitees, and other licensees, those portions of the
Premises and the Building that are designated in a non-discriminatory manner by
Licensor from time to time as being available for such common use (the "Common
Facilities"). The Common Facilities include such areas and facilities as
reception areas, hallways, stairs and elevators, the cafeteria, coffee stations
(including the refreshments supplied by Licensor at no cost to Licensor's
employees), bathrooms, parking stalls, and other similar areas and facilities
designated by Licensor. The cost of Licensee's use of the Common Facilities
shall be included in the License Fee. Conference and training rooms will be
accessible by Licensee based on availability, subject to such rules regarding
scheduling and priority as may be promulgated by Licensor from time to time in a
non-discriminatory manner.
8. PARKING. Subject to reasonable rules and regulations that may be
promulgated by Master Lessor and/or Licensor from time to time, Licensee shall
have the non-exclusive right in common with other tenants, licensees and
occupants of the Building to use, free of charge during the License Term, no
more than twenty (20) parking spaces in the areas adjacent to the Building.
9. SERVICES PROVIDED BY MASTER LESSOR. The Master Lease is a "full
service" "gross" lease. Accordingly, Licensor shall not be responsible to
Licensee for furnishing any service, maintenance or repairs to the License Area
that are the obligation of the Master Lessor under the Master Lease, including
but not limited to general ground maintenance, trash collection, and janitorial
services. However, if Master Lessor shall fail to perform its obligations under
the Master Lease, Licensor, upon receipt of written notice from Licensee, shall
use commercially reasonable efforts to attempt to enforce the obligations of
Master Lessor under the Master Lease; provided, however, that Licensor shall not
be required to incur any costs or expenses in connection therewith unless
Licensee agrees to reimburse Licensor for any such costs and expenses.
3
4
10. SERVICES PROVIDED BY LICENSOR. Licensor shall provide to Licensee at
no cost, except as set forth below, during the License Term, the services
described below (the "Services") in accordance with Licensor's typical practices
and standards in Licensor's sole determination. In accepting Licensor's
agreement to provide such Services, Licensee expressly acknowledges that there
is the possibility of error or malfunction in any or all of the same, and agrees
that Licensee is fully assuming all risks associated with Licensee's use or
dependence on such Services, except for the negligence or intentional misconduct
of Licensor or its agents, contractors and employees.
(a) Licensor shall provide general repairs and maintenance for
the License Area to the extent required by "Tenant" under the terms of the
Master Lease. Licensee shall notify Licensor as soon as possible after Licensee
becomes aware of the need for any repairs or maintenance, or of any of the
foregoing matters that is in need of correction or attention by Licensor.
(b) Licensor shall provide up to 20 telephone systems and
facilities for Licensee's use in the License Area, including telephone set,
voice mail with direct dial extensions; and up to 20 concurrent telephone calls
through Licensor's PBX and interconnect facilities for networking equipment, all
in such amounts and types and according to such specifications as determined by
Licensor in its sole discretion. Licensee shall pay to Licensor (i) a fee on a
time and material basis (with time being billed at $75 per hour) for any changes
to such telephone systems or facilities; (ii) the monthly charges incurred for
toll and long distance calls (including fax transmissions) made by Licensee or
from the License Area; and (iii) a basic monthly telephone service charge, in
the amount of $65 per line per month. Licensee shall use one or more of its
direct dial extensions as Licensee's main office phone number, as the
receptionists employed by Licensor will not be expected to take or deliver
messages for Licensee except in extenuating circumstances.
(c) Licensee shall be permitted to utilize Licensor's mail room
services for the receipt and delivery of mail to and from Licensee, provided
that correct postage on all outgoing mail must be pre-affixed by Licensee.
(d) The License Fee shall include utilities for general office
equipment during normal business hours, which utilities shall be provided by
Master Lessor in accordance with the terms of the Master Lease. For purposes of
this Agreement, "normal business hours" shall mean Monday through Friday, 7:00
a.m. to 6:00 p.m., and Saturdays from 8:00 a.m. to 1:00 p.m. (but not Sundays or
national holidays).
(e) In the event that Licensee requires utilities during times
other than normal business hours, or uses utilities in excess of that required
for general office equipment, or uses specially metered equipment, then Licensee
shall reimburse Licensor for any such reasonable expenses incurred within ten
(10) days after receipt of an invoice for such costs.
(f) The License Fee shall include routine server back-up and
network maintenance. In the event that Licensee requests information technology
services in excess of those described in the
4
5
preceding sentence, then Licensee shall reimburse Licensor for actual expenses
incurred within ten (10) days after receipt of an invoice for such costs.
11. OFFICE SUPPLIES AND EQUIPMENT.
(a) Licensor shall supply Licensee with a photocopy machine, fax
machine, and supplies, including paper. Any such costs will be included in the
License Fee.
(b) Unless otherwise specified in this Agreement, Licensee shall
be responsible for supplying, at Licensee's own cost, all office supplies and
equipment utilized by Licensee in connection with Licensee's operations in the
License Area, including without limitation computer equipment, modems and
networking equipment, postage meter, and all materials and service. Any vendors,
suppliers or service contractors who will need to enter the Premises regularly
for access to the License Area shall be subject to the reasonable approval of
Licensor.
12. COMPLIANCE WITH LAWS.
(a) Licensee and its employees shall in all respects use the
License Area and Common Facilities, and operate Licensee's business therein, in
compliance with the Master Lease and all applicable laws, ordinances and
governmental rules and regulations, including without limitation all fire codes.
(b) Licensee shall secure, at its sole cost and expense, all
necessary use permits, business licenses, and other governmental approvals
necessary for the lawful conduct of Licensee's business.
(c) Licensee shall pay, before delinquency, any and all taxes,
charges, and governmental fees assessed or levied upon or on account of
Licensee's business, Licensee's occupancy of the License Area, and Licensee's
personal property.
13. RULES OF CONDUCT. Licensee and its employees shall at all times use
the License Area, the Services, the Furnishings and the Common Facilities in
compliance with the following provisions:
(a) Licensee shall at all times conduct its activities in or
about the Premises in a professional and proper manner in accordance with
Licensor's rules and regulations regarding employee conduct, which rules
Licensor may change from time to time in a non-discriminatory manner, at
Licensor's sole discretion.
5
6
(b) Licensee shall keep the License Area and the Furnishings
therein neat and safe at all times. Any damage caused by Licensee in excess of
normal wear and tear will be the financial responsibility of Licensee.
(c) Licensee shall abide by Licensor's policies and procedures
regarding access and security, which policies and procedures Licensor may change
from time to time in Licensor's sole discretion. Licensee shall use commercially
reasonable efforts to safeguard and preserve the confidentiality of work spaces,
discussions, work product, systems, files, and any other proprietary information
of Licensor, other licensees, or any other users or occupants of the Building.
(d) Licensee will be provided a copy of Licensor's rules
regulations, and policies and procedures, and will promptly be notified of any
changes in the same.
(e) Unless otherwise allowed pursuant to the Asset Acquisition
Agreement, neither Licensee nor Licensee's agents, employees, or invitees may do
any of the following in, on or about the Premises or the Building: (i) solicit
the employees of Licensor, other licensees or other users or occupants of the
Building for employment; and/or (ii) directly or indirectly or by action in
concert with others, induce or influence (or seek to induce or influence) any
person who is engaged (as an employee, agent, independent contractor, or
otherwise) by Licensor, other licensees or other users or occupants of the
Building to terminate his or her employment or engagement. If, in the reasonable
opinion of Licensor, Licensee or Licensee's agents, employees, or invitees are
engaging in such conduct in, on or about the Premises or the Building, Licensee,
upon demand of Licensor, shall enforce such restrictions and have such persons
removed from the Building. Licensor shall have the right but not the obligation
to remove or exclude from the Premises or the Building any person engaging in
such prohibited conduct.
(f) Neither Licensor nor Licensor's agents, employees, or
invitees may do any of the following in, on or about the Premises or the
Building: (i) solicit the employees of Licensee for employment; and/or (ii)
directly or indirectly or by action in concert with others, induce or influence
(or seek to induce or influence) any person who is engaged (as an employee,
agent, independent contractor, or otherwise) by Licensee to terminate his or her
employment or engagement.
14. CONFIDENTIALITY. Licensee acknowledges that Licensee and other
licensees of the Premises may be permitted by Licensor to utilize Licensor's
computer, telephone, message correspondence, and mail delivery facilities for
their operations, and Licensee agrees to use the utmost care to safeguard and
insure that the confidential information, proprietary information, work product,
systems and files of Licensor, other licensees, or any other users or occupants
of the Premises are not disclosed or misappropriated. Subject to the terms of
Paragraph 16 and 20 of this Agreement, Licensor shall use commercially
reasonable efforts to safeguard and preserve the confidentiality of Licensee's
work spaces, discussions, work product, systems, files, and other proprietary
information; provided, however, Licensee acknowledges that if Licensee and other
licensees of the Premises utilize Licensor's computer, telephone,
6
7
message correspondence, and mail delivery facilities for their operations,
Licensor will have limited means to protect the confidentiality of such
confidential information, work product, systems and files, and Licensee shall
waive all claims for loss or damage to Licensee or any person claiming by,
through or under Licensee resulting from the disclosure or misappropriation of
Licensee's confidential information, work product, systems or files, except to
the extent caused by the gross negligence or intentional misconduct of Licensor.
15. LICENSOR'S RIGHT TO ENTER. Licensee agrees that Licensor shall have
the right to enter the License Area at all times for the purpose of inspecting
the same, making repairs, and performing its obligations under this Agreement.
Licensor shall use commercially reasonable efforts not to interfere with
Licensee's use of the License Area in connection with such entry.
16. NO REPRESENTATIONS BY LICENSOR. Licensee hereby acknowledges and
agrees as follows:
(a) Licensor has made no representations or warranties regarding
the level of safety and security in the Premises, and Licensee will be
responsible for adequately protecting its own possessions, work product and
files.
(b) Licensor has made no representations or warranties regarding
the condition of the License Area or the Common Facilities or the suitability
thereof for Licensee's purposes, and Licensee accepts the same in its "AS IS"
condition.
17. REQUIRED INSURANCE. Licensee shall obtain, at its sole cost and
expense, and deliver to Licensor upon request, signed certificates of insurance
evidencing currently effective policies of insurance as follows:
(a) Commercial general liability insurance with broad form
contractual liability coverage and with limits of not less than One Million
Dollars ($1,000,000) combined each occurrence and in the aggregate insuring
against any and all liability of Licensee and/or Licensor (as an additional
insured) with respect to the License Area, or arising out of the maintenance,
use or occupancy thereof, or in connection with the conduct of Licensee's
business within the Premises.
(b) All Risk property insurance covering Licensee's personal
property and work product, in an amount not less than ninety percent (90%) of
their full replacement cost.
(c) Workers' compensation insurance in such forms and amounts as
is required under the laws of the State in which the Premises is located.
Such required insurance shall be maintained during the License Term and
shall not be canceled or reduced without prior notice to Licensor.
7
8
18. INDEMNIFICATION OF LICENSOR. Licensee shall, at its sole cost and
expense, indemnify, protect, defend (with counsel acceptable to Licensor) and
hold harmless Licensor, its partners, shareholders, officers, directors,
attorneys, agents, beneficiaries, employees, affiliates, contractors, and
related entities (collectively, "Licensor's Related Parties") from and against
all liabilities, obligations, damages, penalties, claims, costs, charges and
expenses, including reasonable attorneys' fees, which may arise in any manner
out of or in connection with (i) Licensee's use of the License Area, the
Furnishings, the Services and/or the Common Facilities; (ii) the conduct of
Licensee's business; (iii) any act or omission of Licensee or Licensee's
partners, shareholders, officers, directors, attorneys, agents, beneficiaries,
employees, affiliates, contractors, and related entities (collectively,
"Licensee's Related Parties") in connection with this Agreement; and/or (iv) any
breach by Licensee under this Agreement; provided, however, Licensee shall have
no obligation to defend or indemnify Licensor from claims to the extent caused
by the negligence or willful misconduct of Licensor or Licensor's Related
Parties.
19. INDEMNIFICATION OF LICENSEE. Licensor shall, at its sole cost and
expense, indemnify, protect, defend (with counsel acceptable to Licensee) and
hold harmless Licensee, and Licensee's Related Parties from and against all
liabilities, obligations, damages, penalties, claims, costs, charges and
expenses, including reasonable attorneys' fees, which may arise in any manner
out of or in connection with any injury or death to any person or injury or
damage to property caused by, arising out of, or involving (i) any willful
misconduct or negligence of Licensor or Licensor's Related Parties in connection
with this Agreement; and/or (ii) any material breach by Licensor under this
Agreement; provided, however, Licensor shall have no obligation to defend or
indemnify Licensee from claims which are caused by the negligence or willful
misconduct of Licensee or Licensee's Related Parties.
20. WAIVER OF RESPONSIBILITY. Except to the extent caused by the willful
misconduct or negligence of Licensor or Licensor's Related Parties, Licensor and
Licensor's Related Parties shall not be liable for, and Licensee waives, all
claims for loss or damage to Licensee's business or damage or injury to person
or property sustained by Licensee or any person claiming by, through, or under
Licensee, resulting from any accident or occurrence in, on or about the License
Area, or any other part of the Building, including, without limitation, claims
for loss, theft or damage resulting from: (i) any Furnishings or other equipment
or appurtenances being in disrepair; (ii) injury done or occasioned by wind or
weather; (iii) any defect in or failure to operate, for whatever reason, any
Furnishings or other equipment or facilities in or about the Building; (iv)
broken glass; (v) any act, omission or negligence of other licensees, any other
users or occupants of the Building or the public; or (vi) any other cause of any
nature. To the maximum extent permitted by law, Licensee agrees to use and
occupy the License Area, the Furnishings, the Services, and the Common
Facilities at Licensee's own risk.
8
9
21. WAIVER OF RIGHT OF RECOVERY. Notwithstanding the terms of Paragraph
12, Licensee (for itself and its insureds) hereby releases and waives all right
of recovery which it might otherwise have (including rights of subrogation)
against Licensor and Licensor's Related Parties by reason of any loss or damage
resulting from any recovery, claim, action or cause for damages or injury or
other occurrence no matter how caused, to the extent that the same is covered by
Licensee's insurance or which would have been covered had Licensee complied
with the requirements of Paragraph 17 of this Agreement. The foregoing waiver
shall be effective whether or not Licensee maintains the insurance required to
be carried pursuant to this Agreement.
Notwithstanding the terms of Paragraph 18, Licensor (for itself and its
insureds) hereby releases and waives all right of recovery which it might
otherwise have (including rights of subrogation) against Licensee and Licensee's
Related Parties by reason of any loss or damage resulting from any recovery,
claim, action or cause for damages or injury or other occurrence no matter how
caused, to the extent that the same is covered by Licensor's insurance.
22. HOLDING OVER. If Licensee fails to vacate the License Area upon
termination of this Agreement, Licensee's presence upon or occupancy of the
License Area shall constitute a trespass. Licensor shall have the benefit of all
provisions of law respecting the recovery of the License Area and removal of
Licensee and its employees, including but not limited to, changing the locks to
the Premises and/or the License Area, requesting action by local law enforcement
officers, and/or immediate injunctive relief. Licensee's occupancy of the
License Area subsequent to the termination of this Agreement shall be subject to
all the terms, covenants, and conditions of this Agreement for Licensor's
benefit, except that the License Fee shall be three times the License Fee
otherwise payable hereunder. After termination of this Agreement, Licensor shall
have no obligation to provide or allow Licensee to use any Furnishings,
Services, or Common Facilities.
23. DEFAULT. Each party may exercise any remedy available to it at law
or in equity upon the other party's breach or default of this Agreement, and the
rights, remedies, and benefits provided by this Agreement and by law are
cumulative and nonexclusive. In the event of any action or other proceeding to
interpret or enforce this Agreement, the prevailing party shall be entitled to
recover its reasonable attorney's fees from the other party.
24. MISCELLANEOUS PROVISIONS. This Agreement may be modified only in
writing by Licensor and Licensee. This Agreement is the only agreement between
the parties with respect to the subject matter of this Agreement, and all other
negotiations, representations and agreements between the parties are merged
therein. This Agreement shall be governed by the laws of the State in which the
Premises is located. This Agreement shall not be strictly construed against the
party preparing it, but shall be construed as if all parties prepared this
Agreement jointly upon the advice of their respective legal counsel. If any
provision in this Agreement is held by any court to be invalid, void or
unenforceable, the remaining provisions shall
9
10
nevertheless continue in full force and effect. Waiver by Licensor of any breach
of any term, covenant or condition herein contained shall not be deemed a waiver
of any subsequent breach of the same or any other term, covenant or condition
herein contained. Time is of the essence of this Agreement and of every term,
covenant and condition hereof.
25. DELIVERY BY COUNTERPARTS AND FACSIMILES. This Agreement may be
executed in two or more counterparts, each of which shall be deemed an original
and which together shall constitute one and the same instrument. Each party may
execute and deliver this instrument by facsimile, and facsimiles of signatures
shall be deemed original signatures for all purposes, but each party executing
and delivering this instrument by facsimile shall also send the other party an
original of this instrument containing such party's ink signature. Each person
executing this Agreement represents that the execution of this Agreement has
been duly authorized by the party on whose behalf the person is executing this
Agreement.
26. BINDING EFFECT. This Agreement shall become binding upon Licensor
and Licensee only when fully executed by Licensor and Licensee.
10
11
(signature page]
IN WITNESS WHEREOF, the parties have executed this Agreement on the
respective dates set forth below.
"Licensor"
ADAPTEC, INC.
a Delaware corporation
By: /s/ XXXXX XXXXXXX
---------------------------------
Title:
------------------------------
Date Signed:
------------------------
"Licensee"
JAYCOR NETWORKS INC.,
a Delaware Corporation
By: /s/ XXXXX X. XXXXXXXX
---------------------------------
Title:
------------------------------
Date Signed:
------------------------
11
12
Adaptec
0000 Xxxxxxxx Xxxx, Xxxxxx, Xx 00000
[Diagram]
Second Floor Plan
13
Adaptec
0000 Xxxxxxxx Xxxx, Xxxxxx, Xx 00000
[Diagram]
Basement Floor Plan: Exhibit A
