EXHIBIT 10.27
QUADRANT/KMS MANAGEMENT SERVICES
LEASE
THIS LEASE is made this 6th day of December, 1996, by and between Sun Life
Assurance Company of Canada (U.S.), a Delaware Corporation, as "Landlord," and
Vixel Corporation, a Delaware Corporation, as "Tenant." Landlord and Tenant
agree as follows:
1. BASIC LEASE TERMS. This section contains the Basic Lease Terms of this
Lease between Landlord and Tenant named below. Other sections,
paragraphs, and exhibits of the Lease referred to in this paragraph
explain and define the Basic Lease Terms in greater detail and are to be
read in conjunction with the Basic Lease Terms.
a. PREMISES:
Xxxxxxxx 00000 Xxxxxxxx Xxxx XX
Quadrant Business Park - Bothell (the "Corporate Park")
Address 00000 Xxxxx Xxxxx Xxxxxxx Xxxxx
Xxxxxxx, XX 00000 (Paragraph 3)
b. AREA OF PREMISES:
Approximately 42,702 square feet. (Paragraph 3)
c. TERM: (PARAGRAPH 4)
(1) Commencement Date: February 1, 1997
(2) Expiration Date: January 31, 2002
(3) Number of Months: 60
(4) Rent Commencement Date: April 1, 1997
d. EXTENSION/RENEWAL OPTIONS: (PARAGRAPH 4(c))
Term Rental
Three (3) Years Market Rate - Similar Properties
e. MONTHLY BASE RENT: (PARAGRAPH 6)
Months 1 - 2 = $ 0.00/mo. NNN
Months 3 - 12 = $ 32,026.50/mo. NNN
Months 13 - 24 = $ 33,805.75/mo. NNN
Months 25 - 36 = $ 35,585.00/mo. NNN
Months 37 - 48 = $ 37,364.25/mo. NNN
Months 49 - 60 = $ 39,143.50/mo. NNN
f. PREPAID RENT AND SECURITY DEPOSIT: (PARAGRAPH 7)
(1) Total Initial Deposit: $416,344.50
(a) Prepaid Rent: $ 32,026.50 for Month 3
1.
(b) Initial Security Deposit: $384,318.00 (Letter of Credit)
g. USE: (PARAGRAPH 8) TENANT'S USE OF PREMISES:
General office, warehouse, light manufacturing, assembly and
testing of electronic systems and components, research and
development.
h. TENANT'S INITIAL ESTIMATED SHARE OF COMMON COSTS AND EXPENSES:
(PARAGRAPH 9)
$12,298.18 per month; or $0.288 per square foot per month.
i. BROKERAGE COMMISSIONS: (PARAGRAPH 37)
(1) Brokerage Firm: Xxxxxxx & Xxxxxxxxx of Washington,
Inc./CB Commercial
(2) Commission Paid By: Landlord
j. NOTICE ADDRESSES: (PARAGRAPH 32)
Landlord:
Sun Life Assurance Company of Canada (U.S.)
c/o Quadrant/KMS Management Services Telephone: (000) 000-0000
Property Management Facsimile: (000) 000-0000
X.X. Xxx 000
X.X. 0xx xx 000xx
Xxxxxxxx, Xxxxxxxxxx 00000
Tenant:
Vixel Corporation
00000 Xxxxx Xxxxx Xxxxxxx Telephone: (000) 000-0000
Xxxxxxx, XX 00000 Facsimile: (000) 000-0000
Attn: ______________________
With a copy to:
Vixel Corporation
000 Xxxxxxxxxxx Xxxxxxx
Xxxxxxxx X, Xxxxx 000
Xxxxxxxxxx, Xx 00000
Attn: Chief Financial Officer
The foregoing Basic Lease Term [LANGUAGE MISSING] a part of the Lease. Each
reference in the Lease to any of the Basic Lease Terms shall mean the respective
information set forth above. Tenant acknowledges that it has read and
understands all of the provisions contained in the entire Lease and all exhibits
which are a part thereof and agrees that the Lease, including the Basic Lease
Terms and all exhibits, reflects the entire understanding and reasonable
expectations of Tenant and Landlord regarding the Premises.
2. PARTIES. This Lease is made between Landlord and Tenant.
2.
3. PREMISES. Landlord agrees to lease to Tenant the "Premises" described in
Exhibit A-1 and consisting of approximately the square feet designated
in paragraph 1.b. The Premises are a part of the "Building", which
Building is located on the real property described on Exhibit A-2 (the
"Property"). The Premises are improved or to be constructed pursuant to
the terms and conditions of Exhibit B (will be attached upon mutual
tenant improvement approval by Landlord and Tenant). The Premises,
Building, and Property are a part of the named Corporate Park stated in
paragraph 1.a ("Corporate Park").
4. TERM. The term of this Lease shall commence on the earlier of:
a. The date specified in paragraph 1.c(1); or Tenant obtaining an
occupancy permit for the Premises; or ninety (90) days after a
lease has been fully executed.
b. If Tenant shall occupy the Premises for the purpose of
commencing operations prior to the date specified in paragraph
1.c(1), then the date of such occupancy.
c. OPTION TO EXTEND TERM: Landlord will grant (1) Option to Extend
the Lease term and all provisions contained in this Lease,
except for the minimum monthly rent, for one three (3) year
period ("Extended Term") following expiration of the initial
term by giving notice of exercise of the Option ("Option
Notice") to Landlord at lease one hundred fifty (150) days
before the expiration of the initial term, provided that if
Tenant is in default of a material term of this Lease beyond the
applicable cure period on the date of giving Option Notice, the
Option Notice shall be ineffective, or if Tenant is in default
of a material term of this Lease beyond the applicable cure
period on the day the Extended Term is to commence, the Extended
Term shall not commence and this Lease shall expire at the end
of the initial term.
Landlord shall give Tenant its initial determination of the fair
market rent either promptly after the receipt of Tenant's notice
exercising Tenant's option to extend, or promptly after
receiving a request for such determination prior to receipt of
Tenant's exercise of its option if such request is received
during the ninety (90) days prior to the date such option must
be exercised. If Tenant disagrees with Landlord's initial
designation of the Fair Market Rent, Landlord and Tenant agree
to negotiate in good faith for a period of up to thirty (30)
days following Tenant's receipt of Landlord's initial
determination of Fair Market Rent in an effort to agree on the
Fair Market Rent, and if the parties cannot agree upon the Fair
Market Rent by the end of such thirty day period, then the Fair
Market Rent shall be submitted to arbitration as follows:
Within fifteen (15) days after the expiration of such thirty
(30) day period, Landlord and Tenant shall either agree on the
name of a single arbitrator or each give notice to the other
specifying the name and address of the arbitrator each has
chosen. The two arbitrators so chosen shall meet within ten (10)
days after the second arbitrator is appointed and if, within
twenty (20) days after the second arbitrator is appointed, the
two arbitrators shall not agree upon a determination of the Fair
Market Rent in
3.
accordance with the following provisions of this Section they
shall together appoint a third arbitrator.
If said two arbitrators cannot agree upon the appointment of a
third arbitrator within ten (10) days after the expiration of
such twenty (20) day period, then either party, on behalf of
both and on notice to the other, may request such appointment by
the then President of the Washington State Commercial
Association of Realtors (or any successor organization) in
accordance with its then prevailing rules. If said President
shall fail to appoint said third arbitrator within ten (10)
after such request is made, then either party, on behalf of both
and on notice to the other, may request such appointment by the
American Arbitration Association (or any successor organization)
in accordance with its then prevailing rules. The sole
arbitrator, both arbitrators or the majority of the arbitrators
(as applicable) shall determine the Fair Market Rent of the
Premises for the extension term as of the first day of the
extension term and render a decision and award as to their
determination to both Landlord and Tenant within twenty (20)
days after the appointment of the last arbitrator chosen. In the
Event that all three arbitrators cannot agree upon such Fair
Market Rent within ten (10) days after the third arbitrator
shall have been selected, then each arbitrator shall submit his
designation of such Fair Market Rent to the other two
arbitrators in writing; and the Fair Market Rent shall be
determined by calculating the average of the two numerically
closest (or, if the values are equidistant, all three) values so
determined.
Each of the arbitrators selected as herein provided shall have
at least ten (10) years experience as a commercial real estate
broker in the Eastside (East of Lake Washington) area dealing
with properties of the same type and quality as the Building.
Each party shall pay the fees and expenses of the arbitrator it
has selected and the fees and expenses of the third arbitrator
and all other expenses (not including counsel fees, witness fees
and similar expenses of the parties, each of which shall be
borne separately by each of the parties) of the arbitration
shall be borne equally by the parties hereto except that the
fees and expenses of the sole arbitrator shall be borne equally
by the parties. Each party may offer to the arbitrators such
evidence as it desires. Each arbitrator shall be the judge of
the relevancy and materiality of the evidence offered, and
conformity to legal rules of evidence shall not be necessary.
All orally presented evidence shall be taken in the presence of
all arbitrators and each of the parties except where such party
is absent following reasonable notice or has waived the right to
be present, and copies of all written evidence shall be
concurrently presented to all arbitrators and each party. The
decision and award of the arbitrator(s) shall be in writing and
be final and conclusive on all parties, and counterpart copies
thereof shall be delivered to each of such parties. Judgment may
be had on the decision and award of the arbitrator(s) so
rendered in any court of competent jurisdiction.
If Tenant does not provide written notice of its option to
extend on or before the dates specified herein, Tenant's Option
to Extend shall be null and void and Tenant shall have no right
to extend the Term.
4.
d. OPTION TO TERMINATE: Landlord shall grant a one-time option to
terminate this Lease after the 36th month. To exercise this
option Tenant must provide Landlord with six (6) months prior
written notice of its intent to terminate the Lease. Tenant must
also pay to Landlord prior to the effective cancellation date a
termination fee equal to the unamortized portion of Tenant
Improvements paid for by Landlord, brokerage fees and space
planning costs incurred by Landlord. The amortization rate will
be ten percent (10%). Additionally, Tenant shall pay to Landlord
a fee equal to four (4) months rent ($149,457.00).
The Lease Term shall expire on the Expiration Date specified in
paragraph 1.c(2), unless sooner terminated or extended as provided
herein.
5. POSSESSION.
a. Landlord shall deliver possession of the Premises to Tenant on
or before seven (7) days from the full execution of this Lease.
In the event that Landlord fails to deliver the Premises to
Tenant within such seven day period, Tenant shall have the right
to terminate this Lease upon notice to Landlord.
b. If Landlord permits Tenant to occupy the Premises prior to the
Commencement Date of the term, such occupancy shall be subject
to all the provisions of this Lease and shall not advance the
Expiration Date of this Lease. Tenant's Share of Common Costs
and Expenses shall be due and payable from the date of Tenant's
occupancy of the Premises for the purpose of commencing
operations.
c. If Tenant should cause any delay in Landlord's completion of the
Premises, thereby delaying Tenant's occupancy of the Premises
beyond the Commencement Date of this Lease, then the Landlord
may, at its option require the Tenant to commence payment of
rent on the stated Rent Commencement Date as specified in
paragraph 1.c.(4) herein.
d. In the event that Tenant is delayed in taking occupancy of the
Premises for the purpose of commencing its operations as a
result of any Landlord Delay in excess of three (3) business
days, the Commencement Date shall be delayed one business day
for each business day of delay resulting from such cause. The
term "Landlord Delay" shall mean any delay (i) in giving of
authorizations or approvals by Landlord; (ii) attributable to
the acts or failure to act of Landlord, its agents or
contractors, that materially interfere with, and thereby delay,
the completion of the tenant improvements; (iii) caused by the
failure of the Building to comply with all applicable laws,
rules regulations and orders for which the Landlord is
responsible for pursuant to the terms of this Lease, in effect
at the time Tenant commences construction of the tenant
improvements, provided Tenant immediately notifies Landlord of
any such failure to comply.
6. RENT. Without prior notice or demand, in advance, Tenant agrees to pay
to Landlord the Monthly Base Rent specified in paragraph 1.a on or
before the first day of each calendar month of the Lease Term. Payment
of Monthly Base Rent shall begin on the Rent Commencement Date specified
in paragraph 1.c.(4). Rent for any period during the Term hereof which
is for
5.
less than one (1) month shall be a prorated portion of the monthly
installment herein, based upon a thirty (30) day month. Rent shall be
paid to Landlord at the address to which notices to Landlord are to be
given, without deduction, or offset in lawful money of the United States
of America, or to such other person or at such other place as Landlord
may from time to time designate in writing.
7. SECURITY DEPOSIT/LETTER OF CREDIT.
a. Landlord acknowledges receipt from Tenant of the Security
Deposit (Letter of Credit), to be held by Landlord, as security,
without interest, for and during the initial four (4) years of
the Lease Term. Tenant shall deposit with Landlord thirty nine
thousand one hundred forty-three dollars ($39,143.00) the first
day of the forty-ninth (49th) month. If all or any part of the
Security Deposit is applied to an obligation of Tenant
hereunder, Tenant shall immediately upon request by Landlord
restore the Security Deposit to its original amount. Tenant
shall not have the right to call upon Landlord to apply all or
any part of the Security Deposit to cure any default or fulfill
any obligation of the Tenant, but such use shall be solely in
the discretion of Landlord. Upon any conveyance by Landlord of
its interest under this Lease, the Security Deposit may be
delivered by Landlord to Landlord's grantee or transferee
provided Landlord is not in default at such time. Upon any such
delivery, Tenant hereby releases Landlord herein named of any
and all liability with respect to the Security Deposit, its
application and return, and Tenant agrees to look solely to such
grantee or transferee. It is further understood that this
provision shall also apply to subsequent grantees and
transferees.
b. Tenant shall furnish to Landlord, at Tenant's sole cost and
expense, a clean, irrevocable and unconditional letter of credit
in the face amount of three hundred eighty four thousand three
hundred eighteen dollars ($384,318.00), in the form of Exhibit D
and drawn in favor of Landlord on a lending institution
reasonably satisfactory to Landlord, together with a copy of the
issuer's corporate resolution or letter from Tenant President or
Board of Directors, authorizing execution of the Letter of
Credit. The Letter of Credit shall have an expiration date no
earlier than the first anniversary of the Commencement Date,
which expiration date shall be automatically extended without
amendment for additional periods of one year. Commencing on the
thirteenth (13th) month, provided the Tenant is not in default
beyond any applicable cure period under any material term of
this Lease (which includes but is not limited to paragraphs 6,
8, 9(a), 12, 15(b), 18, and 33(b), the Letter of Credit shall be
reduced to the face amount per the following schedule:
First day of the thirteenth (13th) month: $ 304,252.00
First day of the twenty-fifth (25th) month: $ 213,510.00
First day of the thirty-seventh (37th) month: $ 117,431.00
and further provided that so long as Tenant is in occupancy of
any part of the Premises, unless the issuer of the Letter of
Credit notifies Landlord in writing that it elects not to renew
the Letter of Credit for such additional period. In the event
Landlord is so notified by the issuer, Landlord shall so notify
Tenant and Tenant shall, within 15 days
6.
after Landlord's notice, deliver to Landlord a replacement
Letter of Credit, such that the first Letter of Credit or
replacement Letter of Credit shall be in effect at all times.
Any replacement Letter of Credit shall be substantially in the
form of Exhibit F, issued by a lending institution reasonably
satisfactory to Landlord, and delivered to Landlord together
with a copy of the issuer's corporate resolution authorizing
execution of the replacement Letter of Credit. If Tenant fails
to deliver to Landlord a replacement Letter of Credit within the
time limits set forth in this paragraph, it shall be a default
under this Lease and Landlord shall be entitled to draw down the
full amount of the Letter of Credit without further notice or
demand and retain the proceeds thereof as substitute security,
subject to the provisions of this Section (drawing down the full
amount of the Letter of Credit shall be deemed to cure Tenant's
failure to deliver the replacement Letter of Credit.)
Landlord shall hold the Letter of Credit as security for the
faithful performance and observance beyond applicable cure
periods by Tenant of the terms, provisions and conditions of
this Lease. It is understood and agreed that if any default by
Tenant occurs hereunder, Landlord shall have the right from time
to time, without further notice or demand and without prejudice
to any other remedy Landlord may have on account thereof, to
make presentment of the Letter of Credit in the full amount, and
Landlord may use, apply, or retain the whole or any part of the
proceeds to the extent required for payment of any Annual Rent
or additional rent to any other sum as to which Tenant is in
default beyond the applicable cure period or for any sum which
Landlord may expend or may be required to expend by reason of
any default by Tenant hereunder, including, but not limited to,
any damage or deficiency accrued before or after summary
proceedings or other reentry by Landlord. It is agreed tat
Landlord shall always have the right to apply the proceeds or
any part thereof, as aforesaid without prejudice to any other
remedy or remedies which Landlord may have, or Landlord may
pursue any other such remedy or remedies in lieu of applying the
proceeds or any part thereof. Tenant shall not have the right to
call upon Landlord to apply all or any part of the proceeds to
cure any default or fulfill any obligation of Tenant, such use
shall be solely in the discretion of Landlord. The proceeds will
be held by Landlord as Security and without any obligation to
segregate the proceeds from any other funds held by Landlord or
to accrue interest thereon for the benefit of Tenant. If
Landlord shall apply the proceeds or any part thereof, as
aforesaid, Tenant shall upon demand restore the Letter of Credit
to the face amount required under this Section or pay to
Landlord the amount necessary to restore the Letter of Credit to
its original amount. In the event that Tenant shall fully and
faithfully comply with all of the terms, provisions, covenants
and conditions of this Lease, the Letter of Credit, or any
remaining proceeds or cash deposits, shall be returned to Tenant
within 30 days after the expiration of the Term and after
delivery of entire possession of the Premises to Landlord. In
the event of a sale or other transfer of the Premises, or
leasing of the Premises, Landlord shall have the right to
transfer the Letter of Credit, or any remaining proceeds, to the
grantee, transferee or lessee (if the letter of credit is not
assignable, Tenant shall furnish Landlord's successor with a
replacement Letter of Credit showing such successor as payee,
provided that the original Letter of Credit then outstanding
shall be simultaneously returned to Tenant) and Landlord shall
thereupon be released by Tenant from any and all liability with
respect to the Letter of Credit, or any remaining proceeds, its
application and return, and Tenant agrees to look solely to the
grantee,
7.
transferee or lessee. It is further understood that this
provision shall also apply to subsequent grantees, transferees
and lessees. Tenant further covenants that it will not assign or
encumber nor attempt to assign or encumber the Letter of Credit
or its proceeds and that neither Landlord nor its successors or
assigns shall be bound by any such assignment, encumbrance,
attempted assignment or attempted encumbrance. Any assignment or
encumbrance or the Letter of Credit or its proceeds by Tenant
shall be null and void and without force or effect at law or in
equity.
8. USE.
a. Tenant shall use the Premises for the purposes specified in
paragraph 1.g above and hereby agrees that it has determined to
its satisfaction that the Premises can be used for those
purposes. Tenant waives any right to terminate this Lease in the
event the Premises cannot be used for such purposes during the
Lease term. The Premises may not be used for any other purpose
without Landlord's written consent, such consent not to be
unreasonable withheld, delayed or conditioned.
b. Tenant shall not do or permit anything to be done in or about
the Premises or bring or keep anything therein which will in any
way increase the existing rate of or affect any fire or other
insurance upon the Building or any of its contents, or cause
cancellation or insurance policy covering the Building or any
part thereof or any of its contents.
c. Tenant shall not do or permit anything to be done in or about
the Premises which will in any way obstruct or interfere with
the rights or other tenants or occupants of the Building or
Corporate Park or, injure or annoy them or use or allow the
Premises to be used for any improper, immoral, unlawful, or
objectionable purpose. Tenant shall not commit or suffer to be
committed any waste, damage, or injury in or upon the Premises.
Tenant shall not place upon or install in windows or other
openings or exterior sides of doors or walls of the Premises any
signs, symbols, drapes, or other materials without written
consent of Landlord.
d. Landlord gives Tenant and its employees, authorized
representatives, and business invitees a nonexclusive right to
the reasonable use and enjoyment of the Common Areas, subject to
Landlord's rights set forth herein.
9. TENANT'S SHARE OF COMMON COSTS AND EXPENSES.
a. Tenant shall pay to Landlord, as additional rent, the amount
estimated by Landlord to be Tenant's Share of Common Costs and
Expenses ("Tenant's Share") as set forth in this paragraph 9.
Tenant's Share shall be payable on or before the first day of
the first full calendar month of the Term hereof or upon
Tenant's occupancy, whichever first occurs, and on the first day
of each and every successive calendar month thereafter during
the Term hereof. Tenant's Share for any period less than one
month shall be paid by the Tenant on a per diem basis, based on
a thirty (30) day month.
8.
b. For the first accounting period of the Term, Tenant's Share
shall be estimated to be equal to the amount specified in
paragraph 1.h per month ("Tenant's Initial Estimated Share of
Common Costs and Expenses").
c. An accounting period is a calendar year; except the first
accounting period shall commence on the date the Lease Term or
Tenant's occupancy commences, as the case may be, and end on
December 31 of the same calendar year. The last accounting
period shall end on the Expiration Date of the Lease Term.
d. Landlord can adjust the Common Costs and Expenses at the
commencement of each new accounting period throughout the Lease
term, whereupon Tenant's Share shall be adjusted accordingly,
if, at any time during any accounting period, Landlord
determines that the actual Common Costs and Expenses for such
accounting period will vary by more than five percent (5%) from
Landlord's original estimate, Landlord may, by written notice to
Tenant, adjust the Common Costs and Expenses for the remainder
of such accounting period, and, accordingly, Tenant's Share to
be paid hereunder. Landlord shall furnish to Tenant, after each
accounting period, a statement showing the actual total Common
Costs and Expenses, the actual Tenant's Share, and the payments
made by Tenant as part of its Tenant's Share during such
accounting period. If the actual Tenant's Share exceeds Tenant's
payments,,, Tenant shall pay to Landlord the deficiency within
thirty (30) days of Tenant's receipt of such statement. If
Tenant's payments made during the accounting period exceed the
actual Tenant's Share, Landlord may, at Tenant's sole election,
pay the excess to Tenant at the time Landlord furnishes said
statement, or credit the excess toward Tenant's payments of
Tenant's Share in the next succeeding accounting period.
Landlord will keep books and records regarding the Common Costs
and Expenses in accordance with the system of accounts and
accounting practices consistently maintained ion a year-to-year
basis. Tenant shall have the right (no more frequently than
twice per calendar year) to review the books and records
pertaining to such costs. If in Tenant's opinion such review
discloses an error in Landlord's books and records with regard
to these costs, Tenant may cause an audit at Tenant's expense of
Landlord's books and records which will be conducted by an
independent certified public accountant designated by Tenant and
reasonably acceptable to Landlord, who does not represent or is
not employed by either Landlord or Tenant on any other matters.
If any audit discloses that Tenant overpaid the costs, Landlord
shall pay Tenant the amount of overpayment within thirty (30)
days after the results of the audit have been disclosed to both
parties. Tenant shall pay all costs and expenses of the audit
unless the audit shows Landlord overstated Tenant's share of the
costs for the subject calendar year by more than five percent
(5%) of the actual amount payable by Tenant, in which case,
Landlord will pay all costs of the audit, not to exceed the
amount of the overcharge, and will pay Tenant interest on the
overpaid amounts at the Default Rate.
e. Common Costs and Expenses shall include the "Property Taxes" and
"Operating Expenses". "Property Taxes" shall include, without
limitation, all real and personal property taxes, charges, and
assessments imposed on the Premises, Building, Property, or
Common Areas; and any other taxes, charges, ground rents, or
assessments assessed
9.
against the Landlord, Premises, Building, Property, or Common
Areas in connection with the use or occupancy of the Premises at
any time during the term of this Lease. Property Taxes does not
include (i) any interest, penalties or fines relating to
Landlord's failure to pay any taxes, assessments or other
charges when due, or (ii) any taxes, surcharges and local
improvement and other assessments levied with respect to any
additional development or construction on the Property, except
that constructed by Tenant. Landlord agrees to pay all Property
Taxes in the maximum number of installments permitted by law.
The Property Taxes shall not be due and payable by Tenant except
in the year in which it is actually paid. Tenant shall only be
obligated to pay for Property Taxes that become due during the
Term of this Lease or any extension thereof. Tenant shall have
the right to have the assessed valuation of the Premises reduced
or may initiate proceedings to contest the Property Taxes. If
required by law, Landlord shall join in the proceedings brought
by Tenant. "Operating Expenses" shall mean the annual Operating
Expenses which include, without limitation, all operating costs
incurred by Landlord or on behalf of the Premises in
maintaining, operating, and providing services to and for the
Building, Property, Common Areas, and the Corporate Park,
including, without limitation, the costs of utilities, supplies,
insurance, independent contractors, property managers, other
suppliers, compensation of all persons who perform regular and
recurring duties connected with the Building, Property, and
Common Areas and Corporate Park, its equipment, utilities,
sprinkler systems, and parking facilities thereto, the cost of
improvements or alterations to the Building, Property, Common
Areas and Corporate Park as may be required by law or reasonably
determined by Landlord to be necessary to improve the operating
efficiency of the Building, Property, Common Areas and Corporate
Park, and allowance to Landlord or Landlord's agent for
supervision of such maintenance, operation,, services and repair
of the Building, Property, and Common Areas and any and all
assessments charged to Landlord or the Property by or through
the Owners Association of the Corporate Park, if any, in
connection with the operation, repair and maintenance of the
Common Areas and Corporate Park.
Notwithstanding anything above to the contrary, Operating
Expenses shall not include (A) debt service (including, without
limitation, interest, principal, points, fees and any impound
payments) required to be made on any real property mortgage or
deed or trust recorded with respect to the Property; (B) the
cost of any items for which Landlord is reimbursed by Insurance
proceeds, condemnation awards, or otherwise; (C) salaries of
officers, executives and owners of Landlord; (D) any costs
included in Expenses representing an amount paid to an entity or
person related to Landlord which is in excess of the amount
which would have been paid in the absence of the relationship;
(E) non-cash items, such as deductions for depreciation or
obsolescence of the Property and building equipment; (F) costs
incurred by Landlord for the repair of damage caused by fire,
windstorm or other casualty, condemnation or eminent domain; (G)
marketing costs including leasing commissions and attorneys'
fees incurred in connection with lease negotiations; (H) costs
incurred by Landlord due to the violation by Landlord of any
law, code, regulation, ordinance or the like or the defense of
Landlord's title to the Property or any part thereof; (I)
overhead and profit increment paid to Landlord or its affiliates
for goods and/or services rendered by unaffiliated third parties
on a
10.
competitive basis; (J) Landlord's general corporate overhead and
general and administrative expenses; (K) costs incurred in
connection with upgrading the Property to comply with disability,
life, fire and safety codes, ordinances, statutes, or other laws
in effect prior to the Commencement Date including, without
limitation, the effect prior to the Commencement Date including,
without limitation, the ADA, including penalties or damages
incurred due to such non-compliance; (L) tax penalties incurred
as a result of Landlord's failure to make payments and/or to
files any tax or informational returns when due; (M) costs for
which Landlord has been compensated by a management fee, and any
management fees in excess of those management fees which are
normally and customarily charged by Landlords of comparable
property in the vicinity; (N) costs arising from the negligence
or fault of Landlord or its agents, or any vendors, contractors,
or providers of materials or services selected, hired or engaged
by Landlord or its agents; (O) notwithstanding any contrary
provision of the Lease, including, without limitation, any
provision relating to capital expenditures, any and all costs
arising from the presence of any Hazardous Material in or about
the Property including, without limitation, Hazardous Materials
in the ground water or soil, not placed on the Property by
Tenant; (P) costs arising from latent defects in the Building or
Common Areas installed by Landlord or repair thereof; (Q) costs
(including in connection therewith all attorneys' fees and costs
of settlement judgments and payments in lieu thereof arising from
claims, disputes or potential disputes in connection with
potential or actual claims, litigation or arbitrations pertaining
to Landlord and/or the Building and/or the Property; (R) any
expenses for repairs or maintenance which are reimbursed through
warranties or service contracts; (S) any costs relating to
landscaping to the property other than routine maintenence or
restoration due to damage of existing landscaping. Any
expenditures by Landlord for Operating Expenses that are
considered Capital Improvements under Landlord's standard
accounting practices as consistently applied, shall be amortized
over the useful life of such asset. Only the amortized portion of
such expenditure applicable to a particular period shall be
considered an item of Operating Expenses for such period.
10. REPAIR RESPONSIBILITY.
a. Landlord represents and warrants that to the best of its
knowledge as of the date of this Lease, the Building (including
Building systems) is in good condition and repair and in
compliance with all applicable existing laws, ordinances, rules,
regulations and orders. Tenant shall have no responsibility for
correcting any noncompliance of the Premises with any applicable
statues, ordinances, regulations, rules, and orders as of the
date of this Lease except for compliance with ADA within the
Premises. All such costs and expenses relating to correcting
such noncompliance shall be the responsibility of the Landlord.
By taking possession of the Premises, Tenant shall be deemed to
have accepted the Premises as being in good, sanitary order,
condition, and repair. Tenant shall, when and if needed, at
Tenant's sole expense, make repairs to the Premises and every
part thereof, including, without limitation, the heating,
ventilating, and air conditioning system, if any, serving only
the Premises. Tenant shall surrender the Premises to Landlord in
good condition upon the expiration or sooner termination of this
Lease; provided, however, that Tenant shall not be held
responsible for damage to the Premises from causes beyond the
reasonable control of Tenant, to the extent covered
11.
by Landlord's fire and extended coverage insurance policy, or
for ordinary wear and tear. Except as specifically provided in
an exhibit, if any, to this Lease, Landlord shall have no
obligation whatsoever to alter, remodel, improve, repair,
decorate, or paint the Premises or any part thereof and the
parties hereto affirm that Landlord has made no representations
to Tenant respecting the condition of the Premises or the
Building, except as specifically herein set forth.
b. Landlord, at its option, may engage a maintenance firm to
maintain the heating, ventilating, and air conditioning system,
if any, servicing only the Premises. Tenant shall pay to
Landlord, or, at landlord's election, directly to the
maintenance firm, the cost of such maintenance, which shall be
in addition to Common Costs and Expenses.
c. Except as provided herein, Tenant shall, at its expense, clean,
maintain, and keep in good repair throughout the term of this
Lease the entire Premises and appurtenances, including, without
limitation, signs, windows, doors, and trade fixtures.
d. Notwithstanding the provisions of paragraph 10.a hereinabove,
but subject to the provisions of paragraph 16, Landlord shall
repair and maintain the structural portions of the Building,
including the basic plumbing, air conditioning, heating, and
electrical systems, installed or furnished by Landlord only
insofar as such heating, air conditioning, and electrical
systems provide service to the entire Building, unless such
maintenance and repairs are caused in part or in whole by the
act, neglect, fault, or omission of any duty by the Tenant, its
agents, servants, employees, or invitees, in which case Tenant
shall pay to Landlord the reasonable costs of such maintenance
and repairs. Landlord shall not be liable for any failure to
make any such repairs or to perform any maintenance unless
Landlord fails to promptly commence such work and diligently
prosecute it to its completion after written notice of the need
of such repairs or maintenance is given to Landlord by Tenant.
Except as provided in paragraph 16 and 17 hereof, there shall be
no abatement of rent and no liability of Landlord by reason of
any injury to or interference with Tenant's business arising
from the making of any repairs, alterations, or improvements in
or to any portion of the Building, the Premises, the Property,
or to fixtures, appurtenances, and equipment therein. Tenant
waives the right to make repairs at Landlord's expense under any
law, statute, or ordinance now or hereafter in effect.
e. Tenant shall comply with the provisions of the American
Disabilities Act (ADA) for improvements constructed by Tenant.
Landlord shall be responsible for reasonable costs for common
area and building exterior compliance for the American
Disabilities Act (ADA).
f. In the event of (i) Premises Partial Damage or (ii) Hazardous
Substance Condition for which Tenant is not legally responsible,
the Base Rent, Common Area Operating Expenses and other charges,
if any, payable by Tenant hereunder for the period during which
such damage or condition, its repair, remediation or restoration
continues, shall be abated in proportion to the degree to which
Tenant's use of the Premises is impaired, but not in excess of
proceeds from insurance required to be carried under Paragraph
15.
12.
Except for abatement of Base Rent, Common Area Operating
Expenses and other charges, if any, as aforesaid, all other
obligations of Tenant hereunder shall be performed by Tenant,
and Tenant shall have no claim against Landlord for any damage
suffered by reason of any such damage, destruction, repair,
remediation or restoration.
g. If Landlord shall be obligated to repair or restore the Premises
under the provisions of this Paragraph 9 and shall not commence,
in a substantial and meaningful way, the repair or restoration
of the Premises within sixty (60) days after such obligation
shall accrue, Tenant may, at any time prior to the commencement
of such repair or restoration, give written notice to Landlord
and to any Lenders of which Tenant has actual notice of Tenant's
election to terminate this Lease on a date not less than sixty
(60) days following the giving of such notice. If Tenant gives
such notice to landlord and such Lenders and such repair or
restoration is not commenced within thirty (30) days after
receipt of such notice, this Lease shall terminate as of the
date specified in said notice. If Landlord or a Lender commences
the repair or restoration of the Premises within thirty (30)
days after the receipt of such notice, this Lease shall continue
in full force and effect. "Commence" as used in this Paragraph
shall mean either the unconditional authorization of the
preparation of the required plans, or the beginning of the
actual work on the Premises, whichever occurs first.
11. MAINTENANCE AND MANAGEMENT.
a. Landlord shall maintain the Common Areas in good condition at
all times. Landlord shall have the right to establish and
enforce reasonable rules and regulations applicable to all
tenants concerning the maintenance, management, use, and
operation of the Common Areas; and to make changes to the Common
Areas, including, without limitation, changes in the location of
driveways, entrances, exits, vehicular parking spaces, parking
area, or the direction of the flow of traffic. Landlord
understands that Tenant has entered into this Lease for the
Property in part, based on the appearance of the Building.
Therefore, Landlord agrees that prior to making any material
alterations affecting the access and appearance of the front of
the Building, Landlord will consult with Tenant and consider
Tenant's recommendations prior to making any such alterations.
b. Common Areas, as defined in this Lease, mean all parts of the
Building, and related land areas and facilities outside the
Individual Premises, but constituting a part of Corporate Park.
Common Areas include, without limitation:
(1) the Property, pedestrian walkways and patios, landscaped
areas, sidewalks, loading areas, parking areas, and
roads located on the Property;
(2) the structural parts of the Building and other
improvements in which the Premises are located, which
structural parts include only the foundation, bearing
and exterior walls (excluding glass and doors),
subflooring, and roof (excluding skylights);
13.
(3) the unexposed electrical, plumbing, and sewage systems
lying outside the Premises;
(4) window frames, gutters, and downspouts on the Building
in which the Premises are located; and
(5) those certain open areas, landscaped areas, and
roadways, utility systems and facilities located outside
the Premises but on the Property, and Building.
c. Landlord shall not be liable, nor shall the rent be abated,
because of interruption of services caused by accident, strikes,
necessity for repairs, or for any other reason beyond its
control.
12. UTILITIES. Tenant shall pay, as additional rent, prior to delinquency,
for heat, light, water, electricity, gas and other utility services
supplied to the Premises and will pay any required deposits therefor.
Water, electric, sewer, and other utility charges for which separate
xxxxxxxx are not available shall be prorated by Landlord and charged to
Tenant based on the ratio of the Premises to the total rentable square
footage of the Building, Buildings within the Corporate Park, or
Property, depending on the metering system then in place; provided,
however, that Landlord may increase Tenant's pro rata portion of any
such charges to reflect unusual or excessive utility systems demands.
Separate charges may be made to reflect unusual or excessive utility
system demands where not separately metered.
13. TENANT IMPROVEMENT ALLOWANCE/ALTERATIONS AND ADDITIONS BY TENANT.
a. Tenant shall submit all construction plans and specifications
describing all the proposed tenant improvements for Landlord's
approval. Upon submission of construction plans for Landlord
approval, Tenant shall identify any improvements to the Premises
that Tenant desires to remove upon termination of the Lease.
Landlord will approve or reject Tenant's proposal within 10 days
of receipt of the proposal. Landlord's failure to reject within
such 10 day period shall be deemed an approval of Tenant's plans
to retain ownership of such improvements. Landlord will provide
to Tenant a tenant improvement allowance of $132,400.00
($5.00/SF) on the office portion of the Premises, paid to Tenant
upon completion of construction and Tenant confirmation of full
payment for the work. All costs associated with construction
drawings and city permits and approvals necessary to build the
space in accordance to tenant requirements will be included in
the tenant improvement allowance. Landlord and landlord's
property manager shall be allowed to reasonably approve
construction plans, specifications, contractors and the work.
Tenant will deliver to landlord certificates of insurance for
the contractors naming Landlord as additional insured.
b. After obtaining the prior written consent of Landlord, which
shall not be unreasonably withheld, delayed or conditioned,
Tenant may make, at its sole expense, such additional
improvements or alterations to the Premises which it may deem
necessary or desirable. Any repairs or new construction by
Tenant shall be done in conformity with plans and specifications
approved by Landlord. All work performed shall be done in a
14.
workmanlike manner and shall become the property of the
Landlord. At the time of approval of plans and specifications,
Landlord shall identify alterations or improvements Landlord may
require removed at the expiration of the term, such removal to
occur at Tenant's sole cost and expense; and Tenant shall repair
all damage to the Premises or Building occurring as a result of
such removal.
14. LIENS. Tenant shall keep the Premises, Building, and Property free from
any liens arising out of any work performed, materials furnished, or
obligations incurred by Tenant. Landlord may require, at Landlord's sole
option, that Tenant shall provide to Landlord, at Tenant's sole cost and
expense, a lien and completion bond in an amount equal to one and
one-half (1.5) times any and all estimated cost or any improvements,
additions, or alterations in the Premises, to insure Landlord against
any liability for mechanics' and materialmen's liens and to insure
completion of the work.
15. INSURANCE.
a. Landlord shall not be liable to Tenant, and Tenant hereby waives
all claims against landlord, for injury or damage to any person
or property in or about the Premises, Building, or Property by
or from any cause whatsoever; provided, that nothing contained
herein shall relieve Landlord from liability for any such injury
or damage caused by Landlord's negligence.
b. Tenant agrees to procure and maintain throughout the Lease Term,
at Tenant's sole cost and expense, comprehensive general
liability and property damage insurance with minimum liability
limits of ($1,000,000) per occurrence, aggregate bodily injury
and property damage; or $1,000,000 combined single limit. Such
policy shall name Landlord, and Landlord's designated
representative, as an additional insured, shall contain
cross-liability endorsements. Tenant shall provide Landlord with
a certificate of such insurance. The liability insurance policy
shall be issued by a firm reasonably satisfactory to Landlord
and shall contain endorsements requiring thirty (30) days notice
to Landlord prior to any cancellation or any reduction in amount
of the coverage.
c. The proceeds of any insurance policies maintained by or for the
benefit of Landlord shall belong to and be paid over to
Landlord. Tenant shall have no interest in or right to such
proceeds and shall make no claim against Landlord or the insurer
for any such proceeds. The insurance coverage which Tenant is
required to maintain hereunder, and any other insurance coverage
which Tenant elects to maintain, may not decrease the amount of
insurance available under any insurance policies maintained by
or for the benefit of Landlord.
d. Tenant, as a material part of the consideration to be rendered
to Landlord, hereby agrees to defend, indemnify, and hold
harmless Landlord against any and all claims, costs, and
liabilities, including reasonable attorneys fees, for damage or
injury (1) arising from Tenant's use of the Premises, or (2)
from the conduct of Tenant's business, or (3) from any activity,
work, or thing done, permitted, or omitted by Tenant or any of
Tenant's agents, contractors, or employees, or (4) from Tenant's
breach of any term of this
15.
Lease, or (5) occurring in or about the Premises, Building, or
Property, unless caused by Landlord's negligence. The provisions
of this paragraph 15 shall survive the expiration or termination
of this Lease with respect to any events occurring prior to such
expiration or termination.
e. Landlord, as a material part of the consideration to be rendered
to Tenant, hereby agrees to defend, indemnify, and hold harmless
Tenant against any and all claims, costs, and liabilities,
including reasonable attorneys' fees, for damage or injury (1)
arising from Landlord's use of the Premises, or (2) from the
conduct of Landlord's business, or (3) from any activity, work,
or thing done, permitted, or omitted by Landlord or any of
Landlord's agents, contractors, or employees, or (4) from
Landlord's breach of any term of this Lease, or (5) occurring in
or about the Premises, Building, or Property, unless caused by
Tenant's negligence. The provisions of this paragraph 15 shall
survive the expiration or termination of this Lease with respect
to any events occurring prior to such expiration or termination.
16. DESTRUCTION. If the Premises or the Building is destroyed by fire,
earthquake, or other casualty to the extent that they are untenantable
in whole or in part, then Landlord may, at Landlord's option, proceed
with reasonable diligence to rebuild and restore the Premises or such
part thereof, provided that within thirty (30) days after such
destruction or injury, Landlord shall in writing notify Tenant of
Landlord's intention to do so. During the period from destruction or
damage until restoration, the rent shall be abated in the same ratio as
that portion of the Premises which Landlord determines is unfit for
occupancy shall bear to the whole Premises. If Landlord shall fail to
notify Tenant, then this Lease shall, at the expiration of the time for
the giving of notice as herein provided, be deemed terminated and at an
end. Landlord shall not be required to repair any injury or damage by
fire or other cause, or to make any repairs or replacements of any
panels, decoration, office fixtures, paintings, floor coverings, or any
other property installed in the Premises by Tenant. The Tenant shall not
be entitled to any compensation or damages from Landlord for loss of the
use of the whole or any part of the Premises, Tenant's personal
property, or any inconvenience or annoyance occasioned by such damage,
repair, reconstruction, or restoration. Notwithstanding any provision to
the contrary, in the event that the Premises and the property cannot be
repaired or restored to a condition that would allow Tenant to continue
its operations within 120 days from the date of such damage or
destruction, or if the Premises are not so repaired or restored within
such 120 day period, Tenant shall have the right to terminate this Lease
upon notice to Landlord without any further liability.
17. CONDEMNATION. If all or part of the Premises are taken under power of
eminent domain, or sold under the threat of the exercise of said power,
this Lease shall terminate as to the part so taken as of the date the
condemning authority takes possession. If more than 25% percent of the
floor area of Premises or the parking area for the Building is taken by
condemnation, Tenant may, by a written notice within ten (10) days after
notice of such taking (or absent of such notice, within ten (10) days
after the condemning authority takes possession), terminate this Lease
as of the date the condemning authority takes possession. If Tenant does
not so terminate, this Lease shall remain in effect as to the portion of
the Premises remaining except that the rent shall be reduced in the
proportion that the floor area taken bears to the original
16.
total floor area; provided, that if circumstances make abatement based
on floor area unreasonable, the rent shall xxxxx by a reasonable amount
to be determined by Landlord. In the event that Tenant elects not to
terminate the Lease with respect to any part of the Premises remaining
after condemnation, Landlord shall have no responsibility to restore
such part of the Premises to its condition prior to condemnation. Any
award for the taking of all or part of the Premises under the power of
eminent domain, including payment made under threat of the exercise of
such power, shall be the property of Landlord, whether made as
compensation for diminution in value of the leasehold or for the taking
of the fee or as severance damages; provided, that Tenant shall be
entitled to such compensation as may be separately awarded or
recoverable by Tenant in Tenant's own right for the loss of or damage to
Tenant's trade fixtures and removable personal property and moving
costs. Landlord shall not be liable to Tenant for the loss of the use of
all or any part of the Premises taken by condemnation.
18. ASSIGNMENT AND SUBLETTING. Tenant shall not assign, let, or sublet this
Lease or any part thereof, either by operation of law or otherwise, or
permit any other party to occupy all or any part of the Premises,
without first obtaining the written consent of Landlord, which shall not
be unreasonably withheld. Landlord agrees to respond to Tenant request
for approval of a sublease within ten (10) days from the receipt of such
request. This Lease shall not be assignable by operation of law.
Landlord and Tenant agree that landlord may charge Tenant a reasonable
sum to reimburse Landlord for legal and administrative costs incurred in
connection with such consent; and that from the date of such assignment,
let or sublease of this Lease, Landlord and Tenant shall share equally
in any rental and other proceeds paid to Tenant in excess of the rent to
be paid to Landlord under the terms of this Lease. If Tenant is a
corporation, any transfer of this Lease from Tenant by merger,
consolidation, or liquidation or any change in the ownership or power to
vote in the majority of the outstanding voting stock of Tenant shall
constitute an assignment for the purpose of this paragraph. If Tenant is
a partnership, any change in the individuals or entities of which the
partnership is composed shall constitute an assignment for purposes of
this section. Subject to the provisions above, this Lease shall be
binding upon and inure to the benefit of the parties, heirs and
successors and assigns. Tenant shall have the right to assign this Lease
to any person or entity without consent of Landlord but with prior
written consent thereof that (a) controls, is controlled by or is under
common control with Tenant, (b) purchases substantially all of Tenants
assets or a controlling interest in Tenant and such entity has a net
worth equal to or greater than Tenant's net worth at the time of this
Lease, or (c) an entity resulting from a merger or consolidation with
Tenant.
19. DEFAULT.
a. The occurrence of any one or more of the following events shall
constitute a material default and breach of the Lease by Tenant:
(1) vacation or abandonment of all of the Premises;
(2) failure by Tenant to make any payment required as and
when due, where such failure shall continue after five
(5) days written notice from Landlord;
17.
(3) failure by Tenant to observe or perform any of the
covenants, conditions, or provisions of this Lease,
other than the making of any payment, where such
failure shall continue for a period of thirty (30) days
after written notice from Landlord; or
(4) (i) the making by Tenant of any general assignment or
general arrangement for the benefit of creditors; (ii)
the filing by or against Tenant a petition in
bankruptcy, including reorganization or arrangement,
unless, in the case of a petition filed against Tenant,
the same is dismissed within thirty (30) days; (iii) the
appointment of a trustee or receiver to take possession
of substantially all of Tenant's assets located at
Premises or of Tenant's interest in this Lease; (iv) the
seizure by any department of any government or any
officer thereof of the business or property of Tenant;
and (v) adjudication that Tenant is bankrupt.
b. Tenant shall notify Landlord promptly of any default by its
nature not necessarily known to Landlord.
c. Landlord shall not be in default unless Landlord fails to
perform its obligations within thirty (30) days after notice by
Tenant specifying wherein Landlord has failed to perform;
provided, that if the nature of Landlord's obligation is such
that more than thirty (30) days are required for performance,
Landlord shall not be in default if Landlord commences
performance within thirty (30) days of Tenant's notice and
thereafter completes Landlord's performance within a reasonable
time. In the event that Landlord fails to cure any default
within the applicable cure period, Tenant may exercise any of
its rights provided in law or at equity and shall have the
right, but not the obligation to cure any such even of default
and to deduct the costs incurred by Tenant to cure such default,
including legal fees and expenses, from the amounts next due and
owning under the Lease.
d. If, pursuant to paragraph 1.e, Tenant was not obligated to pay
Monthly Base Rent for any period of time during the Lease Term
("Rental Concession"), and if Tenant defaults in Tenant's
obligations at any time during the Lease Term, than the Rental
Concession shall be canceled and of no force or effect,
whereupon the full dollar amount of the Rental Concession as
specified in paragraph 1.e shall be due and payable as if no
Rental Concession had ever been granted and without regard to
whether this Lease is terminated by Landlord as a result of
Tenant's default.
In addition, all options and assumptions heretofore, if any, are
cancelled.
20. REMEDIES IN DEFAULT. In the event of any default or breach, Landlord
may, at any time without waiving or limiting any other right or remedy,
reenter and take possession of the premises, or terminate this Lease, or
pursue any remedy allowed by law or equity. Tenant agrees to pay
Landlord the cost of recovering possession of the Premises, the expenses
of reletting, and any other reasonable costs or damages arising out of
Tenant's default, including, without limitation, the costs of removing
persons and property from the Premises, the costs of preparing or
altering the Premises for reletting, broker's commissions, and legal
fees.
18.
Notwithstanding any reentry or termination, the liability of Tenant for
the rent provided for herein shall not be extinguished for the balance
of the term of this Lease, and Tenant covenants and agrees to make good
to the Landlord any deficiency arising from reletting the Premises, at a
lesser rent than herein agreed to. Tenant shall pay such deficiency each
month as the amount thereof is ascertained by the Landlord.
21. ACCESS. Tenant shall permit Landlord to enter the Premises at reasonable
times for the purpose of inspecting, altering, and repairing the
Premises and the Building and ascertaining compliance with the
provisions hereof by Tenant, but nothing herein shall be construed as
imposing any obligation on Landlord to perform any such work or duties.
Landlord may also show the Premises to prospective purchasers or tenants
at reasonable times, provided that Landlord shall not unreasonably
interfere with Tenant's business operation.
22. WAIVER OF SUBROGATION. Anything in this Lease to the contrary
notwithstanding, Tenant and Landlord each waivers its entire right of
recovery, claims, actions, or causes of action against the other for
loss or damage to the Premises, Building, or Property or any personal
property of such party therein that is caused by or incident to the
perils covered by normal All Risk extended coverage clauses of standard
fire insurance policies carried by the parties and in force at the time
of damage or loss. Each party shall cause each insurance policy obtained
by it to provide that the insurance company waives all right to recovery
by way of subrogation against either party in connection with any such
loss or damage. If either Landlord or Tenant is unable to obtain its
insurer's permission to waive any claim against the other party, such
party shall promptly notify the other party of such inability.
23. HOLD-OVER TENANCY. If (without execution of a new lease or written
extension) Tenant shall hold over after the expiration of the term of
this Lease with Landlord's written consent, Tenant shall be deemed to be
occupying the Premises as a Tenant from month to month, which tenancy
may be terminated as provided by law. If Tenant shall hold over after
expiration of the term of this Lease without Landlord's written consent,
Tenant's rent payable shall be increased by one hundred percent (100%)
more than Tenant's Monthly Base Rent required in the last month of the
Term of this Lease. During any such tenancy, Tenant agrees to be bound
by all of the terms, covenants, and conditions as specified, insofar as
applicable.
24. COMPLIANCE WITH LAW. Tenant shall use the Premises or permit anything to
be done in or about the Premises which will in any way conflict with any
law, statute, ordinance, or governmental rule or regulation now in force
or which may hereafter be enacted or promulgated. Tenant shall, at its
sole cost and expense, promptly comply with all laws, statutes,
ordinances, and governmental rules, regulations, or requirements now in
force or which may hereafter be in force, and with the requirements of
any board of fire insurance underwriters or other similar bodies now or
hereafter constituted, relating to, or affecting the conditions, use, or
occupancy of the Premises, excluding structural changes not related to
or affected by Tenant's use of the Premises, improvements to the
Premises, or acts. The judgment of any court of competent jurisdiction
of the admission of Tenant in any action against Tenant, whether
Landlord be a part thereto or not, that Tenant has violated any law,
statute, ordinance, or governmental rule, regulation, or requirement,
shall be conclusive of the fact as between the Landlord and Tenant.
19.
25. RULES AND REGULATIONS. Tenant shall faithfully observe and comply with
the reasonable rules and regulations that Landlord shall from time to
time promulgate. Landlord reserves the right from time to time to make
all reasonable modification to said rules. The additions and
modifications to those rules shall be binding upon Tenant upon delivery
of a copy of them to Tenant. Landlord shall not be responsible to Tenant
for the nonperformance of any said rules by any other tenants or
occupants.
26. PARKING. Tenants shall have the exclusive right to use the parking
facilities of the Building and Property subject to the reasonable rules,
regulations and exclusive use parking designations by Landlord, and any
charges of Landlord for such parking facilities which may be established
or altered by Landlord at any time or form time to time during the term
hereof at no charge.
27. MORTGAGES, DEEDS OF TRUST, PURCHASERS (ESTOPPEL STATEMENT). It is
understood and agreed that Landlord may sell mortgage, or grant deeds of
trust with respect to the Premises, the Building, or the Property and
that Tenant may obtain financing, other than mortgaging the Lease, or
enter into other Agreements that require confirmation of information
relating to this Lease. Tenant and Landlord agree to execute, within ten
(10) days following a request from the other party, such reasonable
certificates as may be required by a mortgagee or trust deed beneficiary
or such other party requiring a certificate stating that the Lease is in
full force and effect and the dates to which the rent and charges have
been paid. Upon a foreclosure or conveyance in lieu of foreclosure, and
a demand by Landlord's successor. Tenant shall attorn to and recognize
such successor as Landlord under this.
28. SUBORDINATION. Tenant agrees that this Lease shall be subordinate to the
lien of any mortgage, deeds or trust, or ground lessee now or hereafter
placed against the Property or Building of which the Premises comprise a
part, and to all renewals and modifications, supplements,
consolidations, and extensions thereof; provided however, in the event
that any mortgages or trust deed beneficiary shall so elect. Landlord
reserves the right to subordinate said mortgage lien to the Lease upon
the terms required by such mortgages or trust deed beneficiary. Landlord
agrees that Tenant's subordination pursuant to this Paragraph 28 is
conditioned on Landlord and its mortgages, beneficiary or ground lessor
agreeing that so long as Tenant is not in default under this Lease
beyond any applicable cure period. Tenant's rights under this Lease
shall not be disturbed.
29. TENANT'S PROPERTY. Furnishings, trade fixtures, and equipment installed
by Tenant shall be the property of Tenant. On termination of the Lease.
Tenant shall remove any such property. Tenant shall repair or reimburse
Landlord for the cost of repairing any damage to the Premises resulting
from the installment or removal of such property. At the expiration of
this Lease, Tenant shall return Premises to Landlord in the same
condition as when Tenant took occupancy, reasonable wear and tear
accepted.
30. REMOVAL OF PROPERTY. All personal property of Tenant remaining on the
Premises after reentry or termination of this Lease, if not so removed
by Tenant within 10 days from notice of Landlord, shall conclusively be
deemed abandoned and may be removed by Landlord. Landlord may store such
property in any place selected by Landlord, including, but not limited
to, a public warehouse, at the expense and risk of the owner thereof,
with the right to sell such stored property without notice to Tenant.
The proceeds of such sale shall be applied first to the
20.
cost of such sales, second to the payment of the cost of removal and
storage. If any, and third to the payment of any other sums of money
which may then be due from Tenant to Landlord under any of the terms
thereof, and the balance, if any, to be paid to Tenant.
31. PERSONAL PROPERTY TAXES. Tenant shall pay, or cause to be paid, before
delinquency, any and all personal property taxes levied or assessed and
which become payable during the term hereof upon Tenant's Leasehold
improvements, equipment, furniture, fixtures, and personal property
locate din the Premises. In the event any or all of the Tenant's
leasehold improvements, equipment, furniture, fixtures, and personal
property shall be assessed and taxed with the Building, Tenant shall pay
to Landlord its share of such taxes within ten (10) days after delivery
to Tenant by Landlord of a statement in writing setting forth the amount
of such taxes applicable to Tenant's personal property.
32. NOTICES. All notices under this Lease shall be effective when mailed by
certified mail or delivered to Landlord and to Tenant at the addresses
specified in paragraph 1.j, or to such other address as either party may
designate to the other in writing from time to time.
33. CONDITIONS OF PREMISES: HAZARDOUS SUBSTANCES
a. Tenant accepts the land, buildings, improvements, environmental
condition, and all other aspects of the Premises in their
present condition, AS IS, including latent defects, without any
representations or warranties, express or implied.
b. Tenant shall not, without first obtaining Landlord's prior
written approval, generate, release, spill, store, deposit,
transport, or dispose of (collectively "Release") any hazardous
substances, sewage, petroleum products, hazardous materials,
toxic substances or any pollutants or substances, defined as
hazardous or toxic in accordance with applicable federal, state,
and local laws and regulations ("Hazardous Substances") in, on
or about the Premises. In the event, and only in the event,
Landlord approves such Release of Hazardous Substances on the
Premises, tenant agrees that such Release shall occur safely and
in compliance with all applicable federal, state, and local laws
and regulations. Tenant shall indemnify, hold harmless and
defend Landlord from any and all claims, liabilities, losses,
damages, cleanup costs, and expenses (including reasonable
attorneys' fees) arising out of or in any way related to the
Release by Tenant, or any of its agents, representatives, or
employees, or the presence of such Hazardous Substances in, on
or about the Premises occurring at any time after the
Commencement date specified in paragraph 1.c(1).
c. Landlord warrants and represents to the best of its knowledge,
no use storage, treatment, or transportation of Hazardous
Substance has occurred in or on the Premises or the property
before the date of this Lease which has not been in compliance
with all applicable federal, state and local laws, rules,
regulations, and ordinances. Landlord additionally warrants and
represents to the best of its knowledge that no release, leak,
discharge, spill, disposal, or emission of Hazardous Substance
has occurred in, on, or under the Premises or the Property and
that the same are free from Hazardous Substances as of the date
of this Lease.
21.
d. Landlord shall indemnify, defend and hold Tenant harmless from
any and all claims, damages, fines, judgments, liabilities,
losses, costs, fees, penalties, charges and expenses assessed
against, or imposed upon Tenant (including without limitation,
any and all sums paid for settlement, attorneys' fees and costs,
consultant and expert fees) arising during or after the Lease
from or in connection with the presence or suspected presence of
Hazardous Substances in or on the Premises or the Property,
unless the Hazardous Substances are present as a result of
Tenant's acts or those of its agents, employees, contractors, or
invitees. Without limitation of the foregoing, this
indemnification shall include any and all costs incurred because
of any investigation, cleanup, removal, or restoration mandated
by a federal, state or local agency or political subdivision,
unless the Hazardous Substances are present as a result of
Tenant, or its agents, employees, contractors or invitees. This
indemnification shall specifically include any and all costs due
to Hazardous Substances which flow, diffuse, migrate, or
percolate into, onto, or under the Premises, Property or other
property after the date of this Lease.
e. The provisions of this paragraph 33 shall survive the expiration
or termination of this Lease with respect to any events
occurring prior to such expiration or termination.
34. SIGNS. The sign criteria for the Premises is set forth in Exhibit C.
35. GENERAL PROVISIONS.
a. ATTORNEYS' FEES. In the event either party requires the services
of any attorney in connection with enforcing the terms of this
Lease, or in the event suite is brought for the recovery of any
rent due under this Lease or for the breach of any covenant or
condition of this Lease, or for the restitution of said Premises
to Landlord and/or eviction of Tenant during said term or after
the expiration thereof, the prevailing party will be entitled to
a reasonable sum for attorneys' fees, witness fees, and court
costs, including costs of appeal.
b. CHOICE OF LAW. This Lease shall be governed by the laws of the
State in which the premises are located.
c. 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.
d. EXHIBITS. Exhibits, if any, affixed to this Lease are a part
thereof.
e. INABILITY TO PERFORM. This Lease and the obligations of the
Tenant hereunder shall not be affected or impaired because the
Landlord is unable to fulfill any of its obligations hereunder
or is delayed in doing so, if such inability is caused by
reasons of strike, labor trouble, acts of God, or any other
cause beyond the reasonable control of the Landlord.
f. INTERPRETATION. This Lease has been submitted to the scrutiny of
all parties hereto and their counsel, if desired, and shall be
given a fair and reasonable interpretation in accordance with
the words hereof, without consideration or weight being given to
its having been drafted by any part hereto or its counsel.
22.
g. JOINT OBLIGATION. If there be more than one Tenant, the
obligations hereunder imposed upon Tenants shall be joint and
several.
h. KEYS. Upon termination of this Lease, Tenant shall surrender all
keys to the Premises to Landlord at the piece then fixed for
payment of rent and shall inform Landlord of all combination
locks, safes, and vaults, if any, in the Premises.
i. LATE CHARGES. Tenant acknowledges that late payment by Tenant to
Landlord of rent or other sums due hereunder will cause Landlord
to incur costs not contemplated by this Lease, the exact amount
of which would be extremely difficult and impractical to
ascertain. Such costs include, but are not limited to,
processing and accounting charges, and late charges which may be
imposed on Landlord by the terms of any mortgage or trust deed
covering the premises; therefore, in the event Tenant should
fail to pay any installment of rent or any other sum due
hereunder within ten (10) days after such amount is due. Tenant
shall pay to Landlord as additional rent a late charge equal to
five percent (5%) of each installment or the sum of $25.00 per
month, whichever is greater. A $5.00 charge will be paid by
Tenant to Landlord for each returned check. In addition, any sum
due and payable to Landlord under the terms of this Lease which
is not paid when due shall bear interest at the rate of two
percent (2%) plus the published prime rate of interest of
Seattle First National bank, Main Office, in effect as of the
first day of the calendar month of such default (and adjusted
accordingly as said prime rate of interest is adjusted) from the
date the same becomes due and payable until paid.
j. LIGHT, AIR, AND VIEW. Landlord does not guarantee the continued
present status of light, air, or view over any improvements
adjoining or in the vicinity of the Building.
k. MARGINAL HEADINGS. The marginal headings and section titles in
the sections of this Lease are not a part of this Lease and
shall have no effect upon the construction or interpretation of
any part hereof.
l. NAME. Tenant shall not use the name of the Building or Corporate
park for any purpose other than as an address of the business to
be conducted by the Tenant in the Premises.
m. PRIOR AGREEMENTS. This Lease contains all of the agreements of
the parties hereto with respect to any matter covered or
mentioned in this Lease, and no prior agreements of
understandings pertaining to any such matters shall be effective
for any purpose. No provision of hits Lease may be amended or
added to except by an agreement in writing signed by the parties
hereto or their respective successors in interest. This Lease
shall not be effective or binding on any party until fully
expected by both parties hereto.
n. RECORDATION. Tenant shall not record this Lease or a short form
memorandum hereof without the prior written consent of Landlord.
o. SALE. In the event of any sale of the Building or Property, or
any assignment of this Lease by Landlord. Landlord shall be and
is hereby entirely freed and relieved of all liability under any
and all of its covenants and obligations contained n or derived
from this Lease arising out of any act, occurrence, or omission
occurring after the consummation of such sale or assignment; and
the purchase or assignee at such sale or
23.
assignment or any subsequent sale or assignment of Lease, the
Property, or Building, shall be deemed without any further
agreement between the parties or their successors in interest or
between the parties and any such purchaser or assignee to have
assumed and agreed to carry out any and all of the covenants and
obligations of the Landlord under this Lease.
p. SEVERABILITY. Any provision of this Lease which shall prove to
be invalid, void, or illegal shall in no way affect, impair, or
invalidate any other provision hereof and such other provision
shall remain in full force and effect.
q. TIME. Time is of the essence of this Lease and each and all of
its provisions in which performance is a factor.
r. WAIVER. The waiver by either party of any term, covenant, or
condition herein contained shall not be deemed to be a waiver of
such term, covenant, or condition on any subsequent breach of
the same or any other term, covenant, or condition herein
contained. The subsequent acceptance of rent hereunder by
Landlord shall not be deemed to be a waiver of any preceding
breach by Tenant of any term, covenant, or condition of this
Lease, other than the failure of the Tenant to pay the
particular rental so accepted, regardless of Landlord's
knowledge of such preceding breach at the time of acceptance of
such rent. NO covenant, term, or condition of this Lease shall
be deemed to have been waived by Landlord unless such wavier
shall be in writing and signed by Landlord's duly authorized
representatives.
s. RESEARCH AND DEVELOPMENT. Landlord agrees to cooperate with
Tenant in obtaining any tax benefit related to the construction
and use of the Premises for research and development. Landlord
agrees that any refund, rebate or other tax benefit from such
construction or use that effectively reduces the tax assessed on
the Premises will be used to reduce the taxes paid by Tenant in
Tenant's share of Common Costs.
36. AUTHORITY OF PARTIES.
a. If Tenant is a corporation, each individual executing this Lease
on behalf of said corporation represents and warrants that he is
duly authorized to execute and deliver this Lease on behalf of
said corporation. In accordance with a duly adopted resolution
of the board of directors of said corporation or in accordance
with its terms.
b. If the Landlord herein is a limited partnership, it is
understood and agreed that any claims by Tenant against Landlord
shall be limited to the assets of the limited partnership, and
Tenant expressly waives any and all rights to proceed against
the individual partners or the officers, directors, or
shareholders of any corporate partner, except to the extent of
their interest in said limited partnership.
37. COMMISSIONS. Commissions payable, if any, shall be paid those Broker(s)
and Agent(s) and by the party specified in paragraph 1.i pursuant to a
separate commission contract. Each party represents that it has not had
dealings with any other real estate broker or salesman with respect to
he Lease, and each party shall defend, indemnify, and hold harmless the
other party from all
24.
costs and liabilities including reasonable attorneys' fees resulting
from any claims to the contrary.
THIS LEASE IS SUBJECT TO ACCEPTANCE BY LANDLORD.
AUTHORITY OF TENANT:
Tenant and each individual executing this Lease on behalf of Tenant
represents and warrants that it is duly authorized to execute and
deliver this Lease and that this Lease is binding upon Tenant in
accordance with its terms.
25.
AGREED AND ACKNOWLEDGED:
TENANT:
VIXEL CORPORATION
a Delaware corporation
By: /s/ Xxxx Xxxxxxxxxx
-------------------------------------
Xxxx Xxxxxxxxxx
Its: CFO
------------------------------------
Date: 12/5/96
-----------------------------------
LANDLORD:
SUNLIFE ASSURANCE CO. OF CANADA (U.S.)
a Delaware corporation
/s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxxxxxx
---------------------------------- --------------------------------------
XXXXXX X. XXXXXXX Xxxx X. Xxxxxxxxx
PROPERTY INVESTMENTS OFFICER
Its: Property Investments Officer
------------------------------------
Date: 12/6/96
-----------------------------------
XXXXX XX XXXXXXXXXX
XXXXXX XX XXXXXXXXX
Xx this day personally appeared before me Xxxx Xxxxxxxxxx to me known to
be the CFO of Vixel Corporation, the corporation that executed the within and
foregoing instrument and acknowledged the instrument to be the free and
voluntary act and deed of said corporation for the uses and purposes therein
mentioned, and on oath stated that he/she was duly authorized to execute said
instrument on behalf of the corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 5th day of
December, 1996.
/s/ Signature Illegible
-----------------------------------------
NOTARY PUBLIC in and for the state of
Washington residing at Edmonds
my commission expires: November 1, 2000
Commonwealth of Massachusetts )
26.
) Ss
County of Norfolk )
On this 6th day of December, 1996 before me appeared Xxxxxx X. Xxxxxxx
and Xxxx X. Xxxxxxxxx, both to me known to be Property Investments Officer and
Property Investments Officer, respectively, of the Sun Life Assurance Company of
Canada, duly authorized to execute the annexed instrument, on behalf of Sun Life
Assurance Company of Canada (U.S.), and acknowledged the said instrument to be
the free and voluntary act and deed of said corporation, for the uses and
purposes therein mentioned, and on oath stated that they were authorized to
execute said instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year first above written.
/s/ Xxxxxx Xxxxxxx
-----------------------------------------
Notary Public
My Commission Expires: May 31, 2002
27.
FIRST AMENDMENT
WHEREAS, Sun Life Assurance Company of Canada (U.S.) as Landlord and Vixel
Corporation as Tenant executed that certain Lease dated December 6, 1996 for the
Premises known as 00000 Xxxxx Xxxxx Xxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxxxx, and
WHEREAS, Landlord and Tenant wish to amend the Commencement Date and Rent
Commencement Date of the Lease.
NOW, THEREFORE, Landlord and Tenant hereby agree to amend the Lease as follows:
1) The Commencement Date specified in Section 1.c.91) of the Lease is
hereby amended by substituting "January 13, 1997" for "February 1,
1997".
2) The Rent Commencement Date specified in Section 1.x(4) of the Lease
is hereby amended by substituting "March 13, 1997" for "April 1, 1997."
Rent for the partial month of March 13, 1997 through March 31, 1997 is
$19,629.15.
Except as specifically amended by the First Amendment, the Lease is in full
force and effect and any conflict between this First Amendment and the Lease
shall be controlled by this First Amendment.
AGREED AND ACCEPTED:
SUNLIFE ASSURANCE CO. OF CANADA (U.S.) VIXEL CORPORATION
By: /s/ Xxxx X. Xxxxxxxxx By: /s/ Signature Illegible
---------------------------------- ---------------------------------
Date: 1/13/97 Date: 1/22/97
------------------------------- -------------------------------
1.
SECOND AMENDMENT
Whereas, Sun Life Assurance Company of Canada (U.S.) as "Landlord" and Vixel
Corporation, as "Tenant" executed that certain Lease dated December 6, 1996 for
the Premises known as 00000 Xxxxx Xxxxx Xxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxxxx,
and,
Whereas, Landlord and Tenant executed a First Amendment dated January 13, 1997,
Nowtherefore, Landlord and Tenant hereby agree to amend the Lease as follows:
1. Section 1.c. (2), EXPIRATION DATE is changed to January 31, 2005
2. Section 1.c. (3), NUMBER OF MONTHS is changed to 96
3. Section 1.e. MONTHLY BASE RENT is changed as follows
Month 61 - 72 = $42,346.15 per month NNN
Month 73 - 84 = $44,054.23 per month NNN
Month 85 - 96 = $45,833.48 per month NNN
4. Section 1.f. (1), TOTAL INITIAL DEPOSIT = $0.00
5. Section 1.f. (2), PREPAID RENT = $0.00
6. Section 1.f. (3) INITIAL SECURITY DEPOSIT = $117,431.00 (Letter of
Credit)
7. Section 1.i. (1) BROKERAGE FIRM: Xxxxxxxxx Group,
8. Section 1.j. NOTICE ADDRESS: LANDLORD: Sun Life Financial, c/o
Norris, Xxxxx & Xxxxxxx, 000 - 000xx Xxxxxx XX, Xxxxxxxx, XX 00000,
tel 000-000-0000; fax 000-000-0000
9. Section 3. PREMISES: Landlord and Tenant hereby acknowledge that
Exhibit B of the Lease applied solely to the initial occupancy
in January, 1997 and that there are no Tenant Improvements provided
by Landlord to Tenant according to this Amendment.
10. Section 4.d. OPTION TO TERMINATE: Option is hereby deleted.
11. Section 7.a SECURITY DEPOSIT: subsection a is hereby deleted.
12. Section 7.b LETTER OF CREDIT: is changed to provide Tenant shall
maintain a Letter of Credit in the amount of $117,431.00 through the
extended term, as amended herein, of the Lease.
13. Section 18. ASSIGNMENT AND SUBLETTING, is amended by the
addition of the following clause to the third sentence in line 8
of section 18 the lease; "after deduction by Tenant of
reasonable actual sublease costs, such as tenant improvements
and lease commissions actually paid to third parties".
14. Therefore, the amended clause shall be: . . . Landlord and
Tenant shall share equally in any rental and other proceeds paid
to Tenant in excess of the rent to be paid to Landlord under the
terms of this Lease, after deduction by Tenant of reasonable
actual sublease costs, such as tenant improvements and lease
commissions, actually paid to third parties.
If Tenant is a corporation . . .
Except as specifically amended by the First and Second Amendments, the
Lease is in full force and effect and any conflict between them shall be
controlled by the Second Amendment.
AGREED AND ACCEPTED
Sub Life Assurance Company Vixel Corporation
of Canada (U.S.)
By: By:
--------------------------------- ------------------------------------
Name: Name:
------------------------------- ----------------------------------
Its: Its:
-------------------------------- -----------------------------------
By:
---------------------------------
Name:
-------------------------------
Its:
--------------------------------
Date: Date:
-------------------------------- ----------------------------------
