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EXHIBIT 10.8.3
THIRD AMENDMENT TO LEASE
THIS THIRD AMENDMENT TO LEASE ("Third Amendment") is made this 10th day
of January, 2000, but shall be effective May 1, 1999, by and between TA/WESTERN,
LLC, a Delaware limited liability company as successor in interest
to THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES ("Landlord") and
VISUAL NETWORKS, INC., a Delaware corporation ("Tenant").
W I T N E S S E T H:
WHEREAS, The Equitable Life Assurance Society of the United States,
Landlord's immediate predecessor in interest, and Tenant entered into that
certain Lease dated December 12, 1996, as amended by that certain Lease
Amendment dated September 2, 1997 (the "First Amendment) and as further amended
by that certain Second Lease Amendment dated February 8, 1999 (the "Second
Amendment) (collectively, the "Lease"), pursuant to which Tenant leased that
certain premises in the building located at 0000 Xxxxxxx Xxxx, Xxxxxxxxx,
Xxxxxxxx (the "Building"), said leased premises containing approximately Twenty
Eight Thousand Five Hundred Ninety Four (28,594) rentable square feet and
designated as Suites 110, 120, 150 and 200 (the "Original Premises"); and
WHEREAS, Landlord and Tenant desire to amend the Lease (i) to extend
the term of the Lease; (ii) to increase the square footage of the Original
Premises; and (iii) to amend certain other terms and conditions of the Lease as
herein provided.
NOW, THEREFORE, in consideration of the premises and mutual covenants
and agreements herein contained and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Landlord and
Tenant hereby agree to the following:
1. RECITALS. The recitals set forth above are incorporated
herein by this reference with the same force and effect as if fully set forth
hereinafter.
2. CAPITALIZED TERMS. Capitalized terms not otherwise defined
herein shall have the meaning ascribed to them in the Original Lease.
3. LANDLORD. All references in the Lease to The Equitable Life
Assurance Society of the United States, previously known as Landlord, shall now
apply to TA/Western, LLC which acquired the Building.
4. TERM.
a. ORIGINAL PREMISES. The Term of the Lease with respect to
the Original Premises is hereby extended for approximately five (5) years and
one (1) month, commencing December 1, 2001 (the "Renewal Date") through December
31, 2006 (inclusively, the "Renewal Term"), unless sooner terminated pursuant to
the Lease as amended hereby.
b. FOURTH EXPANSION PREMISES. The Term of the Lease with
respect to the Fourth Expansion Premises, as hereinafter defined, shall
commence, retroactively, on May 1, 1999 (the "Fourth Expansion Premises
Commencement Date") and shall be coterminous with the Term of the Lease with
respect to the Original Premises and, accordingly, shall expire on the
expiration date with respect to the Original Premises.
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5. PREMISES.
a. Effective retroactively to January 1, 1999 (the "Third
Expansion Premises Commencement Date"), the Original Premises shall be increased
by Thirteen Thousand Four Hundred Fifty One (13,451) rentable square feet of
space on the second (2nd) floor of the Building designated as Suite 220 as shown
on Exhibit A attached hereto (the "Third Expansion Premises) (the Original
Premises and the Third Expansion Premises shall be referred to collectively as
the "Original Premises"). As of the Third Expansion Premises Commencement Date,
Section (b) of the Data Sheet ("Data Sheet") attached to the Lease and made a
part thereof; Section 1(m) of the Lease; Paragraph 1 of the First Amendment and
Paragraph 1 of the Second Amendment are hereby modified to reflect the rentable
square footage of the Premises to be Forty Two Thousand Forty Five (42,045)
rentable square feet.
b. Effective retroactively as of the Fourth Expansion Premises
Commencement Date, the Original Premises shall be additionally increased by
approximately Eleven Thousand Nine Hundred (11,900) rentable square feet of
space on the first (1st) floor of the Building which shall be known as Suite 100
as shown on Exhibit A-1 attached hereto and made a part hereof (the "Fourth
Expansion Premises") to approximately Fifty Three Thousand Nine Hundred Forty
Five (53,945) rentable square feet. As of the Fourth Expansion Premises
Commencement Date, Section (b) of the Data Sheet ("Data Sheet") attached to the
Lease and made a part thereof; Section 1(m) of the Lease; Paragraph 1 of the
First Amendment, Paragraph 1 of the Second Amendment and Paragraph 5.a. of this
Third Amendment are hereby further modified to reflect the rentable square
footage of the Premises to be Fifty Three Thousand Nine Hundred Forty Five
(53,945) rentable square feet.
c. From and after the Fourth Expansion Premises Commencement
Date, except as otherwise provided herein, all references in the Original Lease
and herein to: (i) "Premises" shall refer collectively to the Original Premises,
the Third Expansion Premises and the Fourth Expansion Premises; and (ii) "Lease"
shall be deemed to mean the Original Lease, as amended by the First Amendment,
the Second Amendment and this Third Amendment.
6. BASIC RENTAL
ORIGINAL PREMISES.
a. Effective as of the Fourth Expansion Premises Commencement
Date, Tenant shall pay Basic Rental for the Original Premises in the same manner
as set forth in Section 3 of the Lease in the following amounts:
PERIOD BASIC RENTAL PSF MONTHLY BASIC RENTAL ANNUAL BASIC RENTAL
05-01-99 xx 00-00-00 $16.37 $57,348.09 $688,177.08
10-01-99 xx 00-00-00 $16.37 $57,348.09 $688,177.08
12-01-99 xx 00-00-00 $16.78 $58,808.35 $705,700.20
03-01-00 xx 00-00-00 $16.86 $59,068.53 $708,822.36
12-01-00 xx 00-00-00 $17.29 $60,572.62 $726,871.44
03-01-01 xx 00-00-00 $17.36 $60,840.60 $730,087.20
12-01-01 xx 00-00-00 $22.25 $77,958.44 $935,501.28
12-01-02 xx 00-00-00 $22.92 $80,297.19 $963,566.28
12-01-03 xx 00-00-00 $23.61 $82,706.11 $992,473.32
12-01-04 xx 00-00-00 $24.31 $85,187.29 $1,022.247.48
12-01-05 xx 00-00-00 $25.04 $87,742.91 $1,052,914.92
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FOURTH EXPANSION PREMISES.
b. As of the Fourth Expansion Premises Commencement Date, in
addition to the payments of Basic Rental for the Original Premises as set
forth herein above, Tenant shall pay Basic Rental for the Fourth Expansion
Premises in the same manner as set forth in Section 3 of the Lease, in the
following amounts:
PERIOD BASIC RENTAL PSF MONTHLY BASIC RENTAL ANNUAL BASIC RENTAL
05-01-99 xx 00-00-00 $16.27 $16,131.17 $193,574.04
10-01-99 xx 00-00-00 $21.00 $20,825.00 $249,900.00
12-01-99 xx 00-00-00 $21.00 $20,825.00 $249,900.00
03-01-00 xx 00-00-00 $21.00 $20,825.00 $249,900.00
12-01-00 xx 00-00-00 $21.63 $21,449.75 $257,397.00
03-01-01 xx 00-00-00 $21.63 $21,449.75 $257,397.00
12-01-01 xx 00-00-00 $22.25 $22,064.58 $264,774.96
12-01-02 xx 00-00-00 $22.92 $22,726.52 $272,718.24
12-01-03 xx 00-00-00 $23.61 $23,408.32 $280,899.84
12-01-04 xx 00-00-00 $24.31 $24,110.57 $289,326.84
12-01-05 xx 00-00-00 $25.04 $24,833.88 $298,006.56
c. Section (d) of the Data Sheet and Sections 1(b), 3(d)
and 4 of the Lease are hereby deleted in their entirety.
7. TENANT'S PROPORTIONATE SHARE OF BUILDING.
a. As of the Third Expansion Premises Commencement Date
(January 1, 1999), the definition of Tenant's Proportionate Share as set forth
in Section (l) of the Data Sheet; Sections 1(u) and 1(v) of the Lease; Paragraph
5 of the First Amendment; and Paragraph 5 of the Second Amendment shall be
amended to increase Tenant's Proportionate Share from Fifty Three and 24/100
percent (53.24%) to Seventy Seven and 94/100 percent (77.94%);
b. As of the Fourth Expansion Premises Commencement Date (May
1, 1999), the definition of Tenant's Proportionate Share as set forth in Section
(l) of the Data Sheet; Sections 1(u) and 1(v) of the Lease; Paragraph 5 of the
First Amendment; Paragraph 5 of the Second Amendment and Paragraph 7a. of this
Third Amendment shall be further amended to increase Tenant's Proportionate
Share from Seventy Seven and 94/100 percent (77.94%) to One Hundred and 00/100
percent (100%);
8. BASE YEAR STOP.
a. As of the Renewal Date, Section 1 (d) of the Lease is
hereby amended by deleting Section 1 (d) in its entirety and substituting the
following in lieu thereof:
"Base Year Stop - Original Premises and Third Expansion
Premises": the Basic Cost incurred during the calendar year 2002 divided by the
number of rentable square feet in the Building."
b. As of the Fourth Expansion Premises Commencement Date (May
1, 1999), Section 1 (d) of the Lease is hereby modified by adding the following
at the end of Section 1 (d):
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""Base Year Stop - Fourth Expansion Premises": the Basic
Cost incurred during the calendar year 2000 divided by the number of rentable
square feet in the Building."
9. TENANT'S OBLIGATIONS.
a. As of January 1, 2000, Tenant shall contract directly for
trash removal to or for the benefit of the Premises. As soon as reasonably
possible after December 31, 1999, Landlord shall calculate the per rentable
square foot trash removal cost incurred by Landlord during the calendar year
1999 (the "1999 Trash Removal Cost"), and shall reduce Tenant's Basic Rental, if
applicable, by an amount equal to the 1999 Trash Removal Cost, such reduction to
be retroactive to January 1, 2000;
b. As of January 1, 2000, Tenant shall contract directly for
security services to or for the benefit of the Premises. Commencing January 1,
2000, Landlord shall reduce Tenant's Basic Rental by an amount equal to five
cents ($.05) per rentable square foot of the Premises for the cost of security
services.
c. As soon as reasonably possible after December 31, 1999,
Landlord shall calculate the per rentable square foot electric cost incurred by
Landlord during the calendar year 1999 (the "1999 Electric Cost). Tenant shall
have thirty (30) days from receipt of the 1999 Electric Cost to either (i) cause
the electric services to or for the benefit of the Premises to be placed in
Tenant's name as the responsible party and Tenant shall directly pay to the
local utility company for the electric services to or for the benefit of the
Premises; or (ii) continue to pay for electric services to or for the benefit of
the Premises in accordance with applicable provisions of the Lease. In the event
Tenant elects sub-section (i) hereinabove, Landlord shall reduce Tenant's Basic
Rental, if applicable, by an amount equal to the 1999 Electric Cost, such
reduction to be retroactive to January 1, 2000.
d. Effective January 1, 2000, Tenant shall cause the water and
sewer invoices for the Premises to be placed in Tenant's name as the responsible
party and Tenant shall directly pay to the local utility company for the water
and sewer services to or for the benefit of the Premises. Commencing January 1,
2000, Landlord shall reduce Tenant's Basic Rental by an amount equal to seven
cents ($.07) per rentable square foot of the Premises for the cost of water and
sewer services.
10. TENANT IMPROVEMENTS.
a. TENANT IMPROVEMENTS WITH RESPECT TO THE ORIGINAL PREMISES.
In connection with Tenant's extending the Term of the Lease for the Renewal
Term, Tenant has completed certain improvements with respect to the Original
Premises (the "Original Premises Improvements"). Tenant hereby certifies that it
has filed all drawings and specifications, paid all fees and obtained all
permits and applications from any governmental authorities having jurisdiction,
obtained any certificates or approvals, including a certificate of occupancy,
required to enable Tenant to occupy the Original Premises, and obtained and
delivered to Landlord all necessary lien waivers in connection with the
construction of the Original Premises Improvements. In connection thereto,
Landlord shall grant to Tenant an "Original Premises Improvement Allowance" of
up to a total of Six and 25/100 Dollars ($6.25) per rentable square foot of
space in the Original Premises (i.e., 42,045 rentable square feet multiplied by
$6.25 = $262,781.25). Of the total Original Premises Improvement Allowance,
Three and 25/100 Dollars ($3.25) per rentable square foot of space in the
Original Premises (i.e. 42,045 rentable square feet multiplied by $3.25 =
$136,646.25) shall be disbursed by Landlord to Tenant on or before March 1, 2001
(the "First Disbursement"), and the remaining Three and 00/100 Dollars ($3.00)
per rentable square foot of space in the Original Premises (i.e. 42,045 rentable
square feet multipled by $3.00 = $126,135.00) shall
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be disbursed by Landlord to Tenant on or before March 1, 2002 (the "Second
Disbursement").
b. TENANT IMPROVEMENTS WITH RESPECT TO THE FOURTH EXPANSION
PREMISES. Tenant shall construct improvements for the Fourth Expansion Premises
and Building, as applicable ("Fourth Expansion Premises Improvements") in
accordance with the Work Letter Agreement attached hereto as Schedule 1. In
connection thereto, Landlord hereby grants to Tenant a "Fourth Expansion
Premises Improvement Allowance" of up to Ten and 00/100 Dollars ($10.00) per
rentable square foot of space in the Fourth Expansion Premises (i.e., 11,900
rentable square feet multiplied by $10.00 = $119,000.00), which Fourth Expansion
Premises Improvement Allowance shall be used only for the items specified in the
Cost Breakdown, as that term is defined in Schedule 1. Landlord shall reimburse
to Tenant the Fourth Expansion Premises Improvement Allowance on or before April
1. 2000.
c. Tenant acknowledges that all obligations of Landlord
pursuant to Section 7 of the Lease pertaining to the Original Premises have been
met and Landlord shall have no obligation to construct any tenant improvements
to the Premises on behalf of Tenant.
11. BROKERS. Landlord and Tenant each represent and warrant to the
other that it has not had any dealings or entered into any agreements with any
person, entity, realtor, broker, agent or finder in connection with the
negotiation of this Third Amendment other than XxXxxx & Company, Inc. and The
Xxxx Ezra Company (collectively, the "Brokers"). Landlord shall pay a commission
to the Brokers in accordance with the terms and conditions of a separate
agreement between Landlord and the Brokers. Landlord and Tenant each agree to
indemnify, defend and hold the other harmless from and against any loss, claim,
damage, expense (including costs of suit and reasonable attorneys' fees) or
liability for any compensation, commission or charges claimed by any such
unnamed realtor, broker, agent or finder claiming to have dealt with the
indemnifying party in connection with this Third Amendment.
12. REAFFIRMATION OF TERMS. All other terms, covenants and
provisions of the Original Lease are hereby confirmed and ratified and except as
modified herein, shall remain unchanged and in full force and effect.
13. REPRESENTATIONS. Landlord and Tenant each hereby represent and
warrant to the other that it (i) is not in default of any of its obligations
under the Original Lease and that such Original Lease is valid, binding and
enforceable in accordance with its terms, (ii) it has full power and authority
to execute and perform this Third Amendment, and (iii) it has taken all action
necessary to authorize the execution and performance of this Third Amendment.
14. COUNTERPART COPIES. This Third Amendment may be executed in
two or more counterpart copies, each of which shall be deemed to be an original
and all of which counterparts shall have the same force and effect as if the
parties hereto had executed a single copy of this Third Amendment.
[SIGNATURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, Landlord and Tenant have executed this Third
Amendment as of the day and year first above written.
LANDLORD:
TA/Western, LLC, a Delaware limited liability company
By: Realty Associates Advisors LLC, a Delaware
limited liability company, manager
By: Realty Associates Advisors Trust,
a Massachusetts business trust,
sole member
By: XXXXX X. XXXXXX
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Its: Regional Director
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TENANT:
VISUAL NETWORKS, INC., a Delaware corporation
By: XXXXX X. XXXXXXXX
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Its: Executive Vice President,
----------------------------
Chief Financial Officer and
Treasurer
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EXHIBIT A
THIRD EXPANSION PREMISES
A-1
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EXHIBIT A-1
FOURTH EXPANSION PREMISES
A1 1
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SCHEDULE 1
WORK LETTER AGREEMENT
1. Plans.
Tenant shall cause its architects and engineers to prepare and submit
to Landlord for approval detailed plans, specifications and working drawings
("Plans") for the construction of the Fourth Expansion Premises Improvements to
the Fourth Expansion Premises and Building, as applicable, which such approval
shall not be unreasonably withheld. Landlord reserves the right to reasonably
approve any space planner, architect or engineer employed by Tenant. Tenant's
Plans shall include items and information as Landlord shall reasonably require
to evaluate Tenant's work. Tenant shall use the Plans to obtain all permits and
approvals which are necessary to construct the Fourth Expansion Premises
Improvements. All Fourth Expansion Premises Improvements shall be constructed in
a good and workmanlike manner and in accordance with all applicable laws, codes
and regulations, including the Americans with Disabilities Act ("ADA"). It is
expressly agreed that (a) Tenant shall not commence any such work until said
Plans have been approved by Landlord, and (b) the Plans which have been so
approved by Landlord shall be used by Tenant to obtain all permits that are
necessary to construct the Fourth Expansion Premises Improvements. As used
herein, the term "Fourth Expansion Premises Improvements " shall include all
work to be done in the Fourth Expansion Premises pursuant to the Plans,
including, but not limited to: demolition work, partitioning, doors, ceiling,
floor coverings, wall finishes (including paint and wallcoverings), window
coverings, electrical (excluding the cost of computer cabling, Tenant's
telephone system and wiring, and any other special electrical or wiring
dedicated to Tenant's operations or business), plumbing, heating, ventilating
and air conditioning, fire protection, cabinets and other millwork. After
approval of the Plans by Landlord, no further material changes to the Plan shall
be made without the prior written approval of Landlord which such approval shall
not be unreasonably withheld. Tenant acknowledges that Landlord's review and
approval of the Plans is not conducted for the purpose of determining the
accuracy and completeness of the Plans, their compliance with applicable codes
and governmental regulations including ADA, or their sufficiency for purposes of
obtaining a building permit, all of which shall remain the responsibility of
Tenant and Tenant's architect. Accordingly, Landlord shall not be responsible
for any delays in obtaining the building permit due to the insufficiency of the
Plans or any delays due to changes in the Plans required by the applicable
governmental regulatory agencies reviewing the Plans.
2. Fourth Expansion Premises Improvement Allowance.
Tenant shall provide Landlord with a breakdown of the estimated total
cost of the Fourth Expansion Premises Improvements ("Cost Breakdown"). Landlord
hereby grants to Tenant an "Fourth Expansion Premises Improvement Allowance" of
up to Ten and 00/100 Dollars ($10.00) per rentable square foot of space in the
Fourth Expansion Premises (i.e., 11,900 rentable square feet multiplied by
$10.00 = $119,000.00) which Fourth Expansion Premises Improvement Allowance
shall be used only for the items specified in the Cost Breakdown. The Fourth
Expansion Premises Improvement Allowance shall be disbursed to Tenant not more
frequently than once per month based on disbursement requests submitted by
Tenant to Landlord and certified by Tenant's architect. Such disbursement
request shall set forth the total amount incurred, expended and/or due for each
requested item less prior disbursements and a description of the work performed,
and materials supplied and/or costs incurred or due with respect to each item
for which disbursement is requested. Each such disbursement request shall be
accompanied by invoices, vouchers, statements, affidavits, payroll records
and/or other documents reasonably requested by Landlord, which substantiate
costs incurred to justify such a disbursement, together with lien waivers for
those contractors and materialmen providing construction services or materials.
In addition, each disbursement shall be subject to inspection and approval of
completed work by
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Landlord's construction engineer, which such approval shall not be unreasonably
withheld, conditioned or delayed. In the event the Cost Breakdown exceeds the
Fourth Expansion Premises Improvement Allowance, Tenant shall pay from another
source of funds the amount by which the Cost Breakdown exceeds the Fourth
Expansion Premises Improvement Allowance prior to any disbursement of the Fourth
Expansion Premises Improvement Allowance by Landlord. If, at any time during the
construction of the Fourth Expansion Premises Improvements, the total amount
remaining to be paid for Fourth Expansion Premises Improvements exceeds the
amount of the Fourth Expansion Premises Improvement Allowance remaining to be
disbursed, at Landlord's option, no further disbursement of the Expansion
Premises Improvement Allowance shall be made by Landlord unless, and until
Tenant has expended such sums as to cause the Fourth Expansion Premises
Improvement Allowance to again be sufficient to pay each of the remaining costs.
In the event the actual cost of the Fourth Expansion Premises Improvements is
less than the Fourth Expansion Premises Improvement Allowance, the unused
portion of the Fourth Expansion Premises Improvement Allowance shall not be paid
or refunded to Tenant or be available to Tenant as credit against any
obligations of Tenant under the Lease. Notwithstanding the foregoing, Landlord
shall reimburse to Tenant the Fourth Expansion Premises Improvement Allowance by
no later than April 1, 2000.
3. Construction of Fourth Expansion Premises Improvements.
3.1 Landlord hereby approves Xxxxxxx Xxxxxxxx Construction Company
as Tenant's contractor. Landlord's approval, when required in this Work Letter
Agreement, shall be given or denied (as applicable) within five (5) business
days of receipt of the necessary information from Tenant. Tenant's contractors
and subcontractors shall be required to provide the following types of
insurance, in the minimum amounts indicated, naming Landlord (and Landlord's
mortgagee, if required by Landlord) as additional insured:
(a) Workmen's Compensation with full statutory limits for
employer's liability.
(b) Commercial General Liability Insurance including direct and
contingent liability in the aggregate amount of One Million
and No/100 Dollars ($1,000,000.00) combined single limit
coverage per occurrence for personal injury, death or property
damage.
(c) The Liability Policy shall include coverage for Broad Form
Hold Harmless Agreement as is contained in the standard
contract.
(d) Automobile Liability insurance with bodily injury limits of
$250,000 per person, $500,000 per accident, and $50,000 per
accident for Property Damage.
Certificates of all of the foregoing insurance shall be delivered to Landlord
before construction of the Improvements is started and before Tenant's
contractor's equipment is placed upon the Premises. In all other respects, the
insurance coverage above mentioned shall comply with the Lease provisions.
3.2 It is agreed that Tenant assumes the entire responsibility and
liability due to its negligence, including statutory or common law, for any and
all injuries or death of any or all persons, including its contractor,
subcontractors and employees, and for any and all damages to property caused by
or resulting from or arising out of any act or omission on the part of Tenant,
its contractor, subcontractors or employees, in the prosecution of the work
thereunder other than those arising out of the gross negligence or willful
misconduct of Landlord, its agents or employees. With respect to such work
Tenant agrees to indemnify and save harmless Landlord, its mortgagee, architect,
engineers and their employees and all other tenants of the Property from and
against all losses and expense, including legal fees, which they may suffer or
pay as the result of claims or lawsuits due to, because of or arising out of any
and all such injuries, death or
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damage, whether real or alleged, and Tenant, its contractor and subcontractors
shall assume and defend at their own expense all such claims or lawsuits. Tenant
agrees to insure this assumed liability in its Comprehensive General Liability
Policy and the original or copy of the policy delivered to Landlord shall
indicate this contractual coverage.
3.3 For and during the period of construction, Tenant shall
provide and pay for all utilities consumed upon the Fourth Expansion Premises
during said period and for the removal of all temporary connections.
3.4 Upon completion of the Fourth Expansion Premises Improvements,
Tenant's contractors and/or subcontractors shall provide Landlord, without cost
to Landlord, with one (1) set of transparent "as built" drawings.
3.5 Completion. Tenant shall endeavor to cause the contractor to
substantially complete construction of the Fourth Expansion Premises
Improvements in a diligent manner. It shall be the sole responsibility of Tenant
to file all drawings and specifications, pay all fees and obtain all permits and
applications from any governmental authorities having jurisdiction, and to
obtain any certificates or approvals, including a certificate of occupancy,
required to enable Tenant to occupy the Fourth Expansion Premises. Landlord
shall not be liable for any loss or damages as a result of delays in
construction of the Fourth Expansion Premises Improvements. No delay in
completion of construction of the Fourth Expansion Premises Improvements shall
delay the Commencement Date of the Lease or otherwise effect Tenant's obligation
to pay Basic Rental beyond the date specified in the Third Amendment.
4. Incorporation. This Agreement is and shall be incorporated by reference
in the Lease, and all of the terms and conditions of the Lease are and shall be
incorporated herein by this reference.
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