BELVEDERE PLACE BASIC LEASE INFORMATION
Xxxxxxx 00.0
XXXXXXXXX XXXXX
DATED AS OF JULY 31st, 0000
XXXXXXX
XXXXXX XXXXXXXX XXXXXXXXXX LP,
AS LANDLORD,
AND
REDWOOD TRUST, INC.
AS TENANT
BELVEDERE PLACE
BASIC LEASE INFORMATION
1.
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Date: | July 31st ,2006 | ||
2.
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Landlord: | Bently Holdings California LP | ||
3.
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Tenant: | Redwood Trust, Inc., a Maryland corporation | ||
4.
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Property: | The real property legally described on Exhibit A attached hereto | ||
5.
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Project: | The Property, together with the buildings known as One and Two Belvedere Place and all other improvements located thereon, commonly known as the Belvedere Place Office Center containing approximately 103,598 rentable square feet | ||
6.
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Building: | That certain office building located within the Project located at Xxx Xxxxxxxxx Xxxxx, Xxxx Xxxxxx, Xxxxxxxxxx containing approximately 43,258 rentable square feet | ||
7.
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Premises: | Subject to Section l(b) of the Lease, approximately 21,887 rentable square feet located on the second floor of the Building, as outlined on the floor plan attached hereto as Exhibit B | ||
8.
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Load Factor: | 1.23 (23%) | ||
9.
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Initial Term: | Ten (10) years and five (5) months | ||
10.
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Estimated Delivery Date: | N/A | ||
11 .
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Outside Delivery Date: | N/A | ||
12 .
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Commencement Date : | January 1, 2008 | ||
13.
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Expiration Date: | May 31, 2018, as the same may be extended pursuant to the provisions of Section 40 of the Lease. | ||
14.
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Initial Basic Rental Rate: | $79,012.00/month | ||
15.
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Fair Market Rental Value: | The rental rate per rentable square foot per month (taking into account additional rent and all other monetary payments and considering any base year or expense stop applicable thereto), including all escalations, for all leases for comparable, unencumbered |
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| space for approximately the same lease term, executed at the Project and/or any other comparable Class A building in terms of size, quality, level of services, amenities,age and appearance located within the Southern Marin County area from the northern border of Corte Madera and Larkspur south to the Golden Gate Bridge (collectively, “Comparable Buildings”), during the twelve (12) month period immediately preceding the date upon which the determination of Fair Market Rental Value is made, and having a commencement date within six (6) months of the date that the Fair Market Rental Value will commence under this Lease, and taking into account any free rent, tenant improvements, tenant improvement allowances, moving allowances and other concessions granted to tenants under leases of such comparable space in Comparable Buildings and the value, if any, of the existing tenant improvements (with such value being judged with respect to the utility of such existing tenant improvements to the general business office user and not this particular Tenant), provided that the Fair Market Rental Value shall not include consideration of the value of any Tenant Improvements made to the Premises by Tenant under Section 30 below costing in excess of the Tenant Improvement Allowance or the value of any Alterations to the Premises made at the expense of Tenant. The Fair Market Rental Value shall be determined in accordance with the terms and provisions of this Lease below. | ||||
16.
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Security Deposit: | $79,012.00 | ||
17.
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Base Year: | 2008 | ||
18.
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Tenant’s Proportionate Share: | The ratio which the rentable area of the Premises bears to the rentable area of the entire Project, which, subject to Section l(b) of the Lease, is agreed to be 21%. | ||
19.
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Tenant Improvement Allowance: | Subiect to Section 1(b) of the Lease, $35.00 per rentable square foot multiplied by 21,887 rentable square feet = $766,045.00. | ||
20.
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Space Plan Deadline: | N/A | ||
21 .
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Working Drawing Deadline: | N/A | ||
22.
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Landlord’s Broker: | None | ||
23.
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Tenant’s Broker: | None |
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24.
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Extension Term: | Two five (5) year options, in accordance with Section 40 below | ||
25.
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Guarantor: | None |
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EXHIBITS
Exhibit A
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Legal Description of Property | |
Exhibit B
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Description of Premises | |
Exhibit C
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Notice of Lease Term Dates | |
Exhibit D
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Form of Tenant Estoppel Certificate | |
Exhibit E
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Rules and Regulations | |
Exhibit F
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Base Building Standard Shell Construction Specifications |
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XXXXXXXXX XXXXX OFFICE LEASE
THIS LEASE is entered into by and between Landlord and Tenant, as specified in the
Basic Lease Information, which is incorporated herein by reference, as of the date shown in
Paragraph 1 of the Basic Lease Information.
1. PREMISES.
(a) Initial Premises. Landlord hereby leases to Tenant and Tenant hereby leases
from Landlord the Premises (as defined in Paragraph 7 of the Basic Lease Information) upon
and subject to the terms, covenants and conditions herein set forth. Tenant covenants, as a
material part of the consideration for this Lease, to keep and perform each and all of said terms,
covenants and conditions for which Tenant is responsible and that this Lease is entered into upon
the condition of such performance.
(b) Verification of Usable Square Feet of Premises, Building and Project. For
the purposes of this Lease, “usable square feet” for the Premises shall be calculated pursuant to
the Standard Method for Measuring Floor Area in Office Buildings,
[ANSI Z65.1 — 1996], and “rentable
square feet” shall equal (i) the usable square feet
contained within the Premises multiplied
by (ii) the sum of (x) one (1) plus (y) the Load
Factor (as defined in Paragraph 8 of the
Basic Lease Information). The usable square feet and rentable square
feet of the Premises, Building
and the Project are subject to verification by Tenant’s
architect within ninety (90) days following
the Commencement Date. The usable square feet and rentable square
feet of the Premises are subject
to verification from time to time by Landlord’s planner/designer
only in the event of a change in
the boundaries of the Premises and the parties hereby agree that the
usable square footage and
rentable square footage of the Premises shall be as specified in the
Basic Lease Information unless
and until (i) there is such a change in the boundaries of the
Premises from as shown on Exhibit B attached hereto and/or (ii) Tenant exercises its right to
remeasure as provided above.
Notwithstanding the foregoing, Landlord shall have the right to
verify the usable and rentable
square feet in the Premises after completion of the Tenant
Improvements. In the event either
Landlord or Tenant elects to remeasure as provided herein,
Tenant’s architect may consult with
Landlord’s planner/designer regarding any such verification (if
applicable) as it pertains to the
Premises and such verification shall be subject to the approval of
Tenant’s architect (which
approval shall not be unreasonably withheld, conditioned or delayed),
and Landlord’s architect may
consult with Tenant’s architect regarding any such verification
as it pertains to the Premises and
such verification shall be subject to the approval of Landlord’s architect. In the event
Landlord’s architect and Tenant’s architect cannot agree on
the square footage of the Premises,
Landlord and Tenant shall select a mutually acceptable independent architect to measure the Premises
in accordance with this Section 1(b) and the decision of such architect shall be binding on
Landlord and Tenant. Landlord and Tenant shall equally share the cost of such independent
architect. In the event of such a change in the usable and rentable square footage in the Premises
as provided herein, all amounts, percentages and figures appearing or referred to in this Lease
based upon such incorrect amount (including, without limitation, the amount of rent) shall be
modified in accordance with such determination. If such determination is made, it will be confirmed
in writing by Landlord to Tenant.
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2. TERM.
(a) Initial Term. Except as otherwise provided herein, the term of this Lease
shall be the Initial Term as set forth in Paragraph 9 of the Basic Lease Information,
commencing on the Commencement Date, and ending as of the Expiration Date, as set forth in
Paragraph 12 and Paragraph 13, respectively, of the Basic Lease Information. The
Initial Term, together with any extension term as to which a right has been properly exercised,
shall be referred to as the “Term.” Notwithstanding anything to the contrary set forth in this
Lease, in the event that Landlord has not delivered the Premises to Tenant in the Delivery Condition
by the Outside Delivery Date, as set forth in Paragraph 11 of the Basic Lease Information,
Tenant shall have the right, at Tenant’s sole option, to elect to terminate this Lease by delivery
to Landlord of a notice (the “Termination Notice”), which termination shall be effective thirty (30)
days after Tenant’s delivery of the Termination Notice to Landlord, unless within such thirty (30)
day period
Landlord shall deliver the Premises to Tenant in the Delivery Condition. In the event
Tenant
shall elect to terminate this Lease, Tenant must deliver to Landlord the Termination Notice
prior to the date the Premises are delivered to Tenant in the Delivery Condition.
(b) Confirmation of Lease Term. When the Commencement Date and the Expiration
Date have
been ascertained, the parties shall promptly complete and execute a Notice of Lease
Term Dates in
the form of Exhibit C attached hereto; provided, however, that the failure of the
parties to
confirm same shall not affect the Commencement Date or otherwise invalidate this
Lease.
(c)
Lease Years. The term “Lease Year” when used herein shall mean the twelve months
commencing on the Commencement Date and each subsequent period of
twelve months; provided, however,
that if the Commencement Date does not occur on the first day of the
calendar month, the first Lease
Year shall mean the twelve months commencing on the first day
of the calendar month following
the Commencement Date. As provided above, if the
Commencement Date does not occur on the
first day of the calendar month, the first Lease Year
shall include the period, if any, from the
Commencement Date to the end of the month in which
the Commencement Date occurs.
3. BASIC RENT.
(a) Basic Rent Payments. Tenant agrees to pay Landlord each calendar month, as
base monthly rent, the Basic Rent as set forth in Paragraph 14 of the Basic Lease
Information, subject to adjustment pursuant to subsection (b) below. Each monthly installment of
Basic Rent shall be payable in advance on the first day of each calendar month during the Term. If
the Term commences or ends on a day other than the first day of a calendar month, then the rent for
the months in which this Lease commences or ends shall be prorated (and paid at the beginning of
each such month) in the proportion that the number of days this Lease is in effect during such
month bears to the total number of days in such month, and such partial month’s installment shall
be paid no later than the commencement of the subject month except for the first month’s rent which
shall be paid no later than the Commencement Date. In addition to the Basic Rent, Tenant agrees to
pay as additional rent the amount of additional rent and rent adjustments and other charges
required by this Lease. All rent shall be paid to Landlord, without prior demand and without any
deduction or offset (except as otherwise provided in this Lease), in lawful
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money of the United States of America, at the address of Landlord designated in Section 31
below or to such other person or at such other place as Landlord may from time to time
designate in writing. Except as otherwise provided in this Lease, in the event of a remeasurement
or adjustment of the area of the Premises, the Basic Rent shall be recalculated using the Basic
Rental Rate referenced in Paragraph 14 of the Basic Lease Information.
(b) Adjustment in Basic Rent. The Basic Rent payable by Tenant shall be increased at
the end of each twelve (12) month period by an amount to equal one hundred three percent (103%) of
the Basic Rent in effect immediately prior to the applicable adjustment date in accordance with the
following schedule (subject to modification based on a remeasurement as provided in Section 1(b)):
| Months | Monthly Basic Rent | |||
1-12 |
$ | 79,012.00 | ||
13-24 |
$ | 81,382.36 | ||
25-36 |
$ | 83,823.83 | ||
37-48 |
$ | 86,338.55 | ||
49-60 |
$ | 88,928.70 | ||
61-72 |
$ | 91,596.56 | ||
73-84 |
$ | 94,344.46 | ||
85-96 |
$ | 97,174.79 | ||
97-108 |
$ | 100,090.04 | ||
109-120 |
$ | 103,092.74 | ||
(c) Late Charge. If Tenant fails to pay any installment of Basic Rent,
additional rent or other changes or otherwise fails to make any other payment for which Tenant is
obligated under this Lease within five (5) days after Tenant’s receipt of notice that Tenant failed
to pay same when due, then Tenant shall pay to Landlord a late charge equal to five percent (5%) of
the amount so payable; provided, however, that if Tenant fails to pay any installment of Basic Rent
or additional rent when due more than three (3) times in any twelve (12) month period, Landlord
shall no longer be required to give Tenant notice before imposing the late charge and Tenant shall
pay to Landlord a late charge equal to five percent (5%) of the amount due for any amount not paid
within five (5) days after the date due. Tenant acknowledges that late payments will cause Landlord
to incur costs not contemplated by this Lease, the exact amount of which costs are extremely
difficult and impracticable to calculate. The parties agree that the late charge described above
represents a fair and reasonable estimate of the extra costs incurred by Landlord as a result of
such late payment. Such late charge shall not be deemed a consent by Landlord to any late payment,
nor a waiver of Landlord’s right to insist upon timely payments at any time, nor a waiver of any
remedies to which Landlord is entitled hereunder. In addition, all amounts payable by Tenant to
Landlord hereunder, exclusive of the late change described above, if not paid within five (5) days
after such amounts are due, shall bear interest from the due date until paid at the lesser of (i)
the rate of ten percent (10%) per annum or (ii) the maximum rate of interest permitted to be
collected by the Landlord by law (“Interest Rate”).
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4.
ADDITIONAL RENT. In addition to the Basic Rent provided in Section 3 of this
Lease, Tenant shall pay Tenant’s Proportionate Share as specified in Paragraph 18 of the
Basic Lease Information, of the increase in (Actual Operating Expenses for each Operating Year over
the Base Amount (as such terms are defined below). Tenant’s Proportionate Share of the Building
may change based on remeasurement or adjustment of the area of the Project or the Premises as
described in Section 1(b). In addition, whenever additional space is added to the Premises,
Tenant’s Proportionate Share of the Project shall increase accordingly.
(a)
Estimated Operating Expenses. Within ninety (90) days after the close of
each Operating Year during the Term following the Base Year, Landlord
shall furnish Tenant a written
statement of the “Estimated Operating Expenses” for
the then current Operating Year, and a
corresponding calculation of additional rent, which shall be one-twelfth (1/12) of
Tenant’s Proportionate Share of the amount, if any, by which the Estimated Operating Expenses
exceed the Base Amount. Such additional amount shall be added to the monthly installment of
Basic Rent payable by Tenant under this Lease for each month during such Operating Year.
(b) Actual Operating Expenses. Within ninety (90) days after the close of
each Operating Year (including the Base Year) during the Term, Landlord shall deliver to Tenant
a written statement setting forth the Actual Operating Expenses
during the preceding Operating Year
and the amount by which such Actual Operating Expenses exceed the Base Amount (the“Operating
Expense Increase”). If Tenant’s Proportionate Share of the Operating Expense
Increase for any
Operating Year exceeds the Estimated Operating Expenses paid by
Tenant to Landlord pursuant to
Section 4(a) Tenant shall pay the amount of such excess
to Landlord as additional rent
within thirty (30) days after receipt by Tenant of such
statement. If such statement shows
Tenant’s Proportionate Share of the Operating Expense Increase
to be less than the amount paid by
Tenant to Landlord pursuant to Section 4(a), then the
amount of such overpayment shall be
paid by Landlord to Tenant within thirty (30) days following the
date of such statement or, at
Landlord’s option, credited by Landlord to the payment of rent
next due. Additionally, promptly
following the reassessment of the value of the Project by any such governmental authority subsequent
to the leasing and occupancy of a substantial portion of the Project, Landlord shall provide Tenant
with a written statement reflecting the adjusted Actual Operating Expenses for the Base Year. If,
as a result of Landlord’s recalculation of the Actual Operating Expenses for the Base Year Landlord
determines that the amount paid by Tenant pursuant to this Section 4 for any Operating Year
was less than the amount owed by Tenant for such Operating Year, Tenant shall pay to Landlord the
amount of such shortfall within thirty (30) days after the date of Tenant’s receipt of such
statement, and if, as a result of Landlord’s recalculation of the Actual Operating Expenses for the
Base Year Landlord determines that amounts paid by Tenant pursuant to this Section 4 for any
Operating Year exceeded the amount owed by Tenant for such Operating Year, then the amount of such
overpayment shall be paid by Landlord to Tenant within thirty (30) days following the date of such
statement or, at Landlord’s option, credited by Landlord to the payment of rent next due. Prior to
the date that is one (1)year after Tenant’s receipt of Landlord’s statement of Actual Operating
Expenses for any Operating Year, Landlord shall provide Tenant with reasonable access, upon
reasonable prior notice and during normal business hours, to inspect and photocopy Landlord’s books
and records with respect to the Actual Operating Expenses for such Operating Year (“Tenant’s
Audit”), provided: (i) Tenant is not in default under any of the material provisions of the
Lease (remaining uncured following the expiration of any applicable period for cure under this
Lease),
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(ii) Tenant shall pay any amounts owing hereunder when due, (iii) Tenant’s Audit is performed by an
employee of Tenant or certified, public accountant who is not paid on a contingency fee basis, (iv)
Tenant and any Tenant Party (as defined in Section 6(c) hereof) performing Tenant’s Audit
execute a confidentiality agreement in a form reasonably acceptable to Landlord and Tenant, (v)
Tenant’s Audit shall be performed at Tenant’s sole cost and expense unless otherwise provided
herein and (vi) Tenant’s Audit shall be completed within such sixty (60) days after Landlord gives
Tenant access to its books and records. If, within such sixty (60) day period, Tenant delivers to
Landlord the written results of Tenant’s Audit which states that Actual Operating Expenses are less
than Landlord’s determination of Actual Operating Expenses (the “Discrepancy”), Landlord shall,
promptly after its receipt of the written results of Tenant’s Audit either (A) reimburse Tenant for
the amount of any overpayment made by Tenant to Landlord pursuant to this Section 4(b) and
for Tenant’s reasonable out-of-pocket costs and expenses incurred in performing the Tenant’s Audit
in the event the Discrepancy is greater than five percent (5%) or (B) notify Tenant in writing that
Landlord disagrees with the result of Tenant’s Audit, in which event the Landlord and Tenant shall
submit their respective calculations of the Actual Operating Expenses to a neutral certified public
accountant appointed with the consent of both Landlord and Tenant, who shall review the respective
determinations of Actual Operating Expenses, and shall make a final determination of the Actual
Operating Expenses for the year in question which shall be binding on both Landlord and Tenant, and
if such accountant determines that there is a Discrepancy, Landlord, promptly after its receipt of
such final determination, shall reimburse Tenant for the amount of any overpayment made by Tenant
to Landlord pursuant to this Section 4(b) and for Tenant’s reasonable out-of-pocket costs
and expenses incurred in performing the Tenant’s Audit in the event the Discrepancy is greater than
five percent (5%).
(c)
Determinations. The determination of Actual Operating Expenses and
Estimated Operating Expenses shall be made by Landlord reasonably and in good faith. Any
payments pursuant to this Section 4 shall be additional rent payable by Tenant hereunder,
and in the event of nonpayment thereof, Landlord shall have the same rights with respect to such
nonpayment as it has with respect to any other nonpayment of rent hereunder.
(d)
End of Term. If this Lease shall terminate on a day other than the last day of
an Operating Year, the amount of any adjustment between Estimated
Operating Expenses and Actual
Operating Expenses with respect to the Operating Year in which such
termination occurs shall be
prorated on the basis which the number of days from the commencement
of such Operating Year, to and
including such termination date, bears to three hundred sixty-five (365);and any amount payable by
Landlord to Tenant or Tenant to Landlord with respect to such adjustment shall be payable within
thirty (30) days after delivery of the statement of Actual Operating Expenses with respect to such
Operating Year.
(e)
Definitions. The following terms shall have the respective meanings
hereinafter specified:
(1) “Base Amount” shall mean an amount equal to the Actual Operating Expenses for the Base
Year (as defined in Paragraph 17 of the Basic Lease Information); provided that,
if the Project is not ninety-five percent (95%) occupied (with all tenants paying full rent, as
contrasted with free rent, half rent and the like) during the entire Base Year, then the
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Actual Operating Expenses actually incurred for the Base Year shall be annualized to reflect the
Actual Operating Expenses that would have been incurred had the Project been ninety-five percent
(95%) occupied (with all tenants paying full rent, as contrasted with free rent, half rent and the
like).
(2) “Operating
Year” shall mean a calendar year commencing January 1 and ending December 31.
(3) “Operating
Expenses” shall mean all expenses paid or incurred by Landlord for maintaining,
owning, operating and repairing the Project (as defined in
Paragraph 5 of the Basic Lease
Information), including, without limitation, the Building, and the
personal property used in
conjunction therewith, including, but not limited to expenses
incurred or paid for: (i) Property
Taxes (as hereinafter defined); (ii) utilities for the Project,
including but not limited to
electricity, power, gas, steam, oil or other fuel, water, sewer,
lighting, heating, air conditioning
and ventilating; (iii) permits, licenses and certificates
necessary to operate, manage and lease the
Project; (iv) insurance Landlord reasonably deems appropriate to
carry or is required to carry by
any mortgagee under any mortgage encumbering the Project or any
portion thereof or interest therein
or encumbering any of Landlord’s or the property manager’s
personal property used in the operation
of the Project; (v) supplies, tools, equipment and materials
used in the operation, repair and
maintenance of the Project; (vi) accounting, legal, inspection, consulting, concierge and
other services; (vii) equipment rental (or installment equipment purchase or equipment financing
agreements); (viii) management agreements (including the cost of any management fee actually paid
thereunder and the fair rental value of any office space provided thereunder, up to customary and
reasonable amounts); (ix) wages, salaries and other compensation and benefits (including the fair
value of any parking privileges provided) for all persons (not higher than Project manager) engaged
in the operation, maintenance or security of the Project, and employer’s Social Security taxes,
unemployment taxes or insurance, and any other taxes which may be levied on such wages, salaries,
compensation and benefits (provided that if an employee spends a portion of his or her time on
projects other than the Project, then the wages, salaries, compensation and benefits of such
employee and taxes thereon pursuant hereto shall be reasonably and equitably prorated); (x) payments
under any easement, operating agreement, declaration, restrictive covenant, or instrument pertaining
to the sharing of costs in any planned development or similar arrangement; (xi) operation, repair,
and maintenance of all systems and equipment and components thereof (including replacement of
components); (xii) janitorial service, alarm and security service, window cleaning, trash
removal, elevator maintenance, and cleaning of walks, parking facilities and building walls
(provided that janitorial service to the premises of other Project occupants shall not be included
in Operating Expenses if Tenant separately provides janitorial service to the Premises at Tenant’s
cost); (xiii) replacement of wall and floor coverings, ceiling tiles and fixtures in lobbies,
corridors, rest rooms and other common or public areas or facilities; (xiv) maintenance and
replacement of shrubs, trees, grass, sod and other landscape items, irrigation systems, drainage
facilities, fences, curbs, and walkways; (xv) maintenance of parking facilities; (xvi) roof
repairs and (xvii) capital expenditures, which capital expenditures shall be amortized for
purposes of this Lease over their respective useful lives (together with interest thereon at the
rate of 10% per annum), made (A) primarily to reduce Operating Expenses, or (B) to comply with any
laws or other governmental requirements (except that Operating Expenses shall specifically exclude
work required to correct any non-compliance of the Project with applicable laws or requirements
existing as of the
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Commencement Date where correction of such noncompliance was then legally required as of the
Commencement Date). Notwithstanding the foregoing, Operating Expenses shall not include (a)
depreciation, interest and amortization on mortgages or other debt costs or ground lease payments,
if any; (b) legal fees in connection with leasing, tenant disputes or enforcement of leases; (c)
real estate brokers’ leasing commissions; (d) improvements or alterations to tenant spaces or
allowances, inducements or other concessions for any tenant; (e) the cost of providing any service
directly to and paid directly by, any tenant; (f) costs of any items to the extent Landlord
receives reimbursement from insurance proceeds or from a third party (such proceeds to be deducted
from Operating Expenses in the year in which received); (g) costs incurred by Landlord in
connection with the correction of structural and/or latent defects in the original construction
materials or installations for the Building; (h) costs incurred by Landlord to lease space to new
tenants or to retain existing tenants including all marketing, advertising and promotional
expenditures; (i) costs arising from the presence of Hazardous Materials on or about the Building,
the Project or the land not placed on or about the Premises, Project, land or the Building by the
Tenant or any Tenant Panty; (j) any amount billed separately to another tenant, whether or not the
tenant actually pays such amount; (k) the cost of charitable or political contributions; (1) the
cost of sculpture, paintings or other objects of art; (m) expenses incurred by Landlord in respect
of a development or buildings other than the Project; (n) salaries and benefits of executives and
management personnel above the level of the Project manager; (o) increased costs of performance to
the extent resulting from the negligence or willful misconduct of Landlord or its agents, employees
or contractors; (p) capital expenditures except those capital expenditures made primarily to reduce
Operating Expenses (as to which the amortized cost to be included in Operating Expenses in any
Operating Year shall be limited to the amount of the actual reduction in Operating Expenses during
such Operating Year as a result thereof), or to comply with any laws or other governmental
requirements (provided that Operating Expenses shall specifically exclude costs of work required to
correct any non-compliance of the Project with applicable laws or requirements existing as of the
Commencement Date where correction of such noncompliance was then legally required as of the
Commencement Date), which capital expenditures (together with interest thereon at the rate of 10%
per annum) shall be amortized for purposes of this Lease over their respective useful lives; (q)
rentals for items (except when needed in connection with normal repairs and maintenance of
permanent systems) which if purchased, rather than rented, would constitute a capital expenditure
which is specifically excluded in (p) above (excluding, however, equipment not affixed to the
Building or Project which is used in providing janitorial or similar services); (r) costs incurred
by Landlord for the repair of damage to the Building or Project, to the extent that Landlord is or
should be reimbursed by insurance proceeds, and costs of all capital repairs, replacements or
restorations resulting from a casualty, regardless of whether such repairs are covered by insurance
and costs due to repairs resulting from an earthquake or flood to the extent such costs exceed
$25,000; (s) expenses in connection with services or other benefits which are not offered to Tenant
or for which Tenant is charged for directly; (t) overhead and profit increment paid to Landlord or
to subsidiaries or affiliates of Landlord for goods and/or services in or to the Building and
Project to the extent the same exceeds
the costs of such goods and/or services rendered by
unaffiliated third parties on a competitive basis; (u) Landlord’s general corporate overhead and
general and administrative expenses; (v) advertising and promotional expenditures, and costs of
signs in or on the Project or the Building identifying the owner of the Project or Building or
other tenants’ signs; (w) costs incurred in connection with upgrading the Building or Project to
comply with
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life, fire and safety codes, ordinances, statutes or other laws in effect prior to the
Commencement Date, including, without limitation, the ADA, including penalties or damages incurred
due to such non compliance; (x) tax penalties incurred as a result of Landlord’s failure to make
payments and/or to file any tax or informational returns when due; (y) 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 Buildings; (z) costs
associated with the operation of the business of the partnership or entity which constitutes
Landlord as the same are distinguished from the costs of operation of the Building and Project,
including partnership accounting and legal matters, costs of defending any lawsuits with or claims
by any mortgagee (except as the actions of Tenant may be in issue), costs of selling, syndicating,
financing, mortgaging or hypothecating any of Landlord’s interest in the Building or Project,
costs of any disputes between Landlord and its employees (if any) not engaged in Building or
Project operation, disputes of Landlord with Building or Project management, or outside fees paid
in connection with disputes with other tenants; (aa) any increase of, or reassessment in, real
property taxes and assessments in excess of two percent (2%) of the taxes for the previous year,
resulting from either (1) any sale, transfer, or other change in ownership of the Building or the
Project during the Term or from major alterations, improvements, modifications or renovations to
the Building or the Project; (bb) the cost of any item included in Operating Expenses to the
extent that such cost is attributable solely to the use, management, repair, service, insurance,
condition, operation or maintenance of other office buildings in the Project; or (cc) reserves for
bad debts or for future improvements, repairs, additions, etc.
(4)
“Estimated Operating Expenses” shall mean Landlord’s estimate of Operating Expenses for the
following Operating Year, adjusted as if ninety-five percent (95%) of the total rentable area of the
Property will be occupied for the entire Operating Year, Base Year or Operating Year, as applicable,
with all tenants paying full rent, as contrasted with free rent, half rent and the like.
(5) “Actual
Operating Expenses” shall mean the actual Operating Expenses for the Base Year or
any Operating Year, as applicable, adjusted, (a) if less than
ninety-five percent (95%) of the total
rentable area of the Project had been occupied for the entire Base
Year or Operating Year, as
applicable, as if ninety-five percent (95%) of the total rentable
area of the Project had been
occupied for the entire Base Year or Operating Year, with all tenants
paying full rent, as
contrasted with free rent, half rent and the like, and (b) if
the Property Taxes component of the
Base Year or Operating Year, as applicable, are based on an
assessment of the value of the Project
made by a governmental authority prior to completion of the Project
and/or prior to leasing and
occupancy of a substantial portion of the Project, then the Property
Taxes component of the Actual
Operating Expenses for such Operating Year or Base Year, as applicable, shall be adjusted by
Landlord, in Landlord’s reasonable discretion, as if the Project had been fully assessed in such
Base Year or Operating Year with all improvements completed therein.
(6)
“Property Taxes” shall mean all real and personal property taxes and assessments imposed by
any governmental authority or agency on the Project; any assessments levied in lieu of such taxes;
any non-progressive tax on or measured by gross rents received from the rental of space in the
Project; and any other costs levied or assessed by, or at the direction of,
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any federal, state, or local government authority in connection with the use or occupancy of the
Project or the Premises or the parking facilities serving the Project; any tax on any document to
which Tenant is a party creating or transferring an interest in the Premises, and any expenses,
including the reasonable cost of attorneys or experts, incurred by Landlord in seeking reduction
by the taxing authority of the above-referenced taxes, less any tax refunds obtained as a result
of an application for review thereof; but shall not include any net income, franchise, estate,
excess profits, documentary transfer or inheritance taxes.
5.
SECURITY DEPOSIT. Tenant has deposited with Landlord the Security Deposit specified in
Section 16 of the Basic Lease Information. Said sum shall
be held by Landlord as security
for the faithful performance by Tenant of all of Tenant’s
obligations under this Lease. If Tenant
defaults with respect to any provision hereof, including but not
limited to the provisions relating
to payment of rent, Landlord may (but shall not be required to) use,
apply or retain all or part of
the Security Deposit for the payment of any rent or any other sum in
default, or for the payment of
any other amount which Landlord may incur by reason of Tenant’s
default or to compensate Landlord
for any other loss or damage which Landlord may suffer by reason of Tenant’s default. If any portion
of the deposit is so use or applied, Tenant shall, upon demand, immediately deposit cash with
Landlord in an amount sufficient to restore the Security Deposit to its original amount. Tenant’s
failure to do so shall be a material breach of this Lease. Landlord shall not be obligated to keep
the Security Deposit separate from its general funds, and Tenant shall not be entitled to interest
on such deposit. If Tenant fully and faithfully performs all of its obligations under this Lease,
the Security Deposit or any balance thereof shall be returned to Tenant (or, at Landlord’s option,
to the last assignee of Tenant’s interests hereunder) after the expiration of the Term, provided
that Landlord may retain all or a portion of the Security Deposit in an amount reasonably determined
by Landlord to be necessary to cover any amounts owed by Tenant for the clean-up and repair of the
Premises if Tenant has filed to satisfy its obligations under Section 7(b) of this Lease, and Actual
Operating Expenses during the Term.
6. USES; HAZARDOUS MATERIAL.
(a) Use. Landlord agrees that the Premises may be used for (i) the sale and
trading of securities (including, without limitation) stocks and bonds, (ii) providing private
banking services, investment banking services, trust services and other diversified financial
services, (iii) the sale of insurance, (iv) office use, including conference and computer
facilities, employee and visitor cafeteria and dining areas (including related kitchen facilities)
and/or (vi) and other legally permitted use consistent with the character of the Project and
Comparable Buildings. Tenant, at its sole cost and expense, shall promptly comply with all local,
state and federal laws, statutes, ordinances and governmental rules, regulations or requirements
now in force or which may hereinafter be in force relating to the use of the Premises, including,
without limitation, the Americans with Disabilities Act, 42 U. S .C. § 12101 et seq. and any
governmental regulations relating thereto (collectively, the “ADA”), including any required
alterations within the Premises for purposes of “public accommodations” under such statute.
However, notwithstanding anything to the contrary contained in this Lease, Landlord (and not
Tenant), at Landlord’s cost but as an item of Operating Expenses (subject to the provisions of
Section 4(e) above establishing certain exclusions from Operating Expenses), shall be
required to make any alterations or improvements to the Premises constituting capital expenditures
(including, without limitation, alterations or improvements to the Premises in order to comply
with the ADA
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constituting capital expenditures) and to the Building Structure and Building Systems (as those
terms are defined in Section 7(a) below) to the extent such alterations or improvements are
required to cause the Premises to comply with applicable laws, except that Tenant (and not
Landlord), at Tenant’s sole cost, shall be responsible for performing such alterations or
improvements work to the extent such compliance work is necessitated by the particular use of the
Premises by Tenant, any subtenant of Tenant or any of their respective employees, agents,
contractors, licensees or invitees (collectively, “Tenant
Parties”) (as opposed to mere occupancy
for general office use) or by any Alterations to the Premises under Section 8 below to the
extent such Alterations are not normal and customary business office improvements. Tenant shall not
use or permit the Premises to be used in any manner nor do any act which would increase the
existing rate of insurance on the Project (unless Tenant agrees to pay such increased cost) or
cause the cancellation of any insurance policy covering the Project, nor shall Tenant permit to be
kept, used or sold, in or about the Premises, any article which may be prohibited by the standard
form of fire insurance policy, unless Tenant obtains an endorsement to the policy allowing such
activity. Tenant shall not during the Term (i) commit or allow to be committed any waste upon the
Premises, or any public or private nuisance in or around the Project, (ii) allow any sale by
auction upon the Premises, (iii) place any loads upon the floor, walls, or ceiling of the Premises
which endanger the Building, (iv) use any apparatus, machinery or device in or about the Premises
which will cause any substantial noise or vibration or in any manner damage the Building, (v) place
any harmful liquids in the drainage system or in the soils surrounding the Project, or (vi) disturb
or unreasonably interfere with other tenants of the Project. If any of Tenant’s office machines or
equipment unreasonably disturbs the quiet enjoyment of any other tenant in the Building, then
Tenant shall provide adequate insulation, or take such other action as may be reasonably necessary
to eliminate the disturbance, all at Tenant’s sole cost and expense.
(b) Hazardous Material. As used herein, the term “Hazardous Material” means any
hazardous or toxic substance, material or waste which is or becomes regulated by, or is dealt with
in, any local governmental authority, the State of California or the United States Government.
Accordingly, the term “Hazardous Material” includes, without limitation, any material or substance
which is (i) defined as a “hazardous waste,” “extremely hazardous waste” or “restricted hazardous
waste” under Sections 25115, 25117 or 25122.7, or listed pursuant to Section 25140 of the
California Health and Safety Code, Division 20, Chapter 6.5 (Hazardous Waste Control Law), (ii)
defined as a “hazardous substance” under Section 25316 of the California Health and Safety Code,
Division 20, Chapter 6.95 (Hazardous Materials Release Response Plans and Inventory), (iii)
defined as a “hazardous substance” under Section 25281 of the California Health and Safety Code,
Division 20, Chapter 6.7 (Underground Storage of Hazardous Substances), (iv) petroleum, (v)
asbestos, (vi) listed under Article 9 or defined as hazardous or extremely hazardous pursuant to
Article 11 of Title 22 of the California Administrative Code, Division 4, Chapter 20, (vii)
designated as a “hazardous substance” pursuant to Section 311 of the Federal Water Pollution
Control Act (33 U.S.C. § 1317), (viii) defined as a “hazardous waste” pursuant to Section 1004 of
the Federal Resource Conservation and Recovery Act, 42 U.S.C. § 6902 et seq., or (ix) defined as a
“hazardous substance” pursuant to Section 101 of the Compensation and Liability Act, 42 U.S.C. §
9601 et seq. Tenant shall not (either with or without negligence) cause or permit the escape,
disposal or release of any Hazardous Materials in or on the Premises or the Project by any Tenant
Parties. Tenant shall not allow the storage or use of Hazardous Materials in any manner not
sanctioned by law or by the highest standards prevailing in the industry for the storage or use of
such substances or materials,
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nor allow to be brought onto the Building or Project any such materials or substances, except
that Tenant may maintain products in the Premises which are incidental to the operation of its
offices, such as photocopy supplies, secretarial supplies and limited janitorial supplies which
products contain chemicals which are categorized as Hazardous Materials, provided that the use of
such products in the Premises by Tenant shall be in compliance with applicable laws and shall be in
the manner in which such products are designed to be used. In addition, Tenant shall execute
affidavits, representations and the like from time to time at Landlord’s request concerning
Tenant’s best knowledge and belief with no independent investigation regarding the presence of
Hazardous Materials on the Premises. The covenants of this Section 6(b) shall survive the
expiration or earlier termination of the Lease. To the best of Landlord’s actual knowledge, there
are no Hazardous Materials in the Building, the Project or the Premises as of the date hereof.
(c) Environmental Obligations. Landlord and Tenant shall notify each other in writing
of (i) any enforcement, clean-up, removal or other governmental action instituted with regard to
Hazardous Materials involving the Project, (ii) any claim made by any person against either of the
parties related to Hazardous Materials in the Premises or the Project, (iii) any reports made to
any governmental agency arising out of or in connection with Hazardous Materials in the Premises
or the Project including, without limitation, any complaints, notices or warnings, and (iv) any
spill, release, discharge or disposal of Hazardous Materials in the Premises or the Project that
is required to be reported to any governmental agency or authority under any applicable
governmental law, rule or regulation. Tenant shall indemnify and hold Landlord and its affiliates
harmless with respect to any environmental claims or liabilities which occur as a result of the
breach by Tenant of any of Tenant’s covenants set forth in Section 6(b) above or this
Section 6(c) and from any escape, seepage, leakage, spillage, discharge, emission, release
from, onto or into the Premises, the Building or the Project of any Hazardous Materials to the
extent caused by Tenant or any of Tenant Parties. Landlord shall indemnify and hold Tenant and the
Tenant Parties harmless with respect to any environmental claims or liabilities which occur as a
result of the breach by Landlord of any of Landlord’s covenants, representations or warranties set
forth in Section 6(b) above or this Section 6(c) and from any escape, seepage,
leakage, spillage, discharge, emission, release from, onto or into the Premises, the Building or
the Project of any Hazardous Materials to the extent caused by Landlord or its employees, agents,
contractors, licensees or invitees.
7. MAINTENANCE AND REPAIRS.
(a) Landlord’s Obligations. Landlord shall maintain and keep in first-class condition
and state of repair (comparable to other Comparable Buildings) and, subject to Section 6 above, in
compliance with applicable laws, the foundations, exterior walls, structural portions of the roof
and other structural portions of the Building (including the floor/ceiling slabs, curtain wall,
exterior glass and mullions, columns, beams, shafts (including elevator shafts), stairs, parking
facilities, stairwells, escalators, elevator cabs, plazas, pavement, sidewalks, curbs, entrances,
landscaping, art work, sculptures, restrooms, mechanical, electrical and telephone closets, and
all common and public areas) (collectively, the “Building Structure”), and shall maintain the
electrical, plumbing, heating, ventilating, sprinkler and life-safety equipment in the Building
(collectively, the “Building Systems”); and except that all damage or injury to the Premises, the
Building or the equipment and improvements therein caused by any act, neglect, misuse or omission
of any duty by any Tenant Parties shall be paid by Tenant except to the extent the cost
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of same is covered by insurance carried by Landlord hereunder (or would have been covered
had Landlord carried the insurance required hereunder). Subject to the provisions of Section
42(i) below, Landlord shall commence performance of any such required repairs promptly (but in
any event within ten (10) days or sooner if required by reason of an emergency situation, unsafe
condition or threat to person or property) following receipt of written notice from Tenant of the
need for such repairs and shall thereafter diligently prosecute the work of such repairs to
completion. Subject to the following provisions of this Section 7(a), Tenant hereby waives
and releases its right to make repairs at Landlord’s expense under Sections 1941 and 1942 of the
California Civil Code or under any similar law, statute or ordinance now or hereafter in effect.
Landlord makes no warranty as to the quality, continuity or availability of the telecommunications
services in the Building, and Tenant hereby waives any claim against Landlord for any actual or
consequential damages (including damages for loss of business) if Tenant’s telecommunications
services in any way are interrupted, damaged or rendered less effective, except to the extent
caused by the negligence or willful misconduct of Landlord, its agents, contractors or employees.
However, if Landlord fails to perform any of Landlord’s obligations under this Section 7(a)
promptly after receipt of written notice of the need therefore from Tenant, and (1) such failure
results in a situation which materially and adversely affects the operation of Tenant’s business
from the Premises or an material risk of injury to persons or material property damage, (2) such
failure is susceptible of cure by Tenant without work upon or otherwise affecting the exterior
appearance of the Building, or adversely affecting the structural elements of the Building or the
integrated Building mechanical or utility systems, and (3) within three (3) business days (or such
shorter period as is reasonable under the circumstances if relating to an emergency situation,
unsafe condition or threat to person or property) following Landlord’s receipt of a second written
notice from Tenant of the existence of such situation stating Tenant’s intent to exercise its
rights under this Section if such situation is not cured, Landlord fails to commence and thereafter
diligently prosecute to completion the cure thereof, then Tenant shall have the right, but not the
obligation, to promptly take such measures as are necessary to cure such situation (using
qualified, licensed contractors reasonably experienced in performance of comparable work in
Comparable Buildings), and Landlord shall reimburse Tenant for the reasonable costs of completing
such cure, plus interest at the ten percent (10%) per annum (or such lesser rate as is the then
maximum lawful rate of interest) from the date such costs were incurred by Tenant until such
reimbursement by Landlord, within thirty (30) days following Tenant’s submission to Landlord of
reasonable evidence of the amount of such costs. If within thirty (30) days following Tenant’s
completion of such cure and submission of such evidence of the costs thereof, Landlord does not
either pay to Tenant the amount requested or deliver written notice
(an “Objection Notice”) to
Tenant objecting to Tenant’s claim that Landlord was required to perform such work under this Lease
and/or the amount requested for reimbursement (provided that if Landlord so objects to a portion of
the amount requested for reimbursement, Landlord shall pay to Tenant the undisputed amount), then,
notwithstanding anything to the contrary contained in this Lease, Tenant may offset the amount so
requested, including interest, for reimbursement from Tenant’s rental obligations next coming due
under this Lease; provided that if Landlord so delivers an Objection Notice, Tenant shall not be
entitled to any such offset (other than as to undisputed amounts if the Objection Notice objects
only to a portion of the amount requested for reimbursement) and as Tenant’s sole remedy for
amounts not so reimbursed or offset, Tenant may proceed to claim a default by Landlord. Any dispute
as to
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which Landlord delivers an Objection Notice pursuant hereto shall be resolved by arbitration in
accordance with the provisions of Section 37 below.
(b) Tenant’s Obligations. Tenant shall at its expense maintain, repair and replace all
portions of the Premises and the equipment or fixtures therein, except to the extent specified in
Section 7(a), above, at all times in first-class condition and state of repair, all in
accordance with the laws of the State of California and all health, fire, police and other
ordinances, regulations and directives of governmental agencies having jurisdiction over such
matters. However, notwithstanding anything to the contrary contained in this Lease, Landlord (and
not Tenant), at Landlord’s cost as an item of Operating Expenses (subject to the provisions of
Section 4(e) above establishing certain exclusions from Operating Expenses), shall be
required to make any alterations, additions or improvements to the Premises constituting capital
expenditures (including, without limitation, alterations, additions or improvements to the Premises
constituting capital expenditures required in order to comply with the ADA) and to the Building
Structure and Building Systems to the extent such alterations, additions or improvements are
required to cause the Premises to comply with applicable laws, except that Tenant (and not
Landlord), at Tenant’s sole cost, shall be responsible for performing such alterations, additions
or improvements work to the extent such compliance work is necessitated by the particular use of
the Premises by Tenant or any of the Tenant Parties (as opposed to mere occupancy for general
office use) or by any Alterations to the Premises under Section 8 below to the extent such
Alterations are not normal and customary business office improvements. Tenant shall replace at
Tenant’s sole expense any glass that may be broken in the Premises with glass of the same size,
specifications and quality, with signs thereon, if required. At the expiration of the Term, Tenant
shall surrender the Premises in good and reasonably clean condition, normal wear and tear and
damage by fire, other casualty or condemnation excepted; provided, however, that Tenant shall have
no obligation to repaint, install new floor coverings or patch wall and floor penetrations.
8. ALTERATIONS.
(a) Landlord’s Consent. Tenant shall not make any alterations, additions
or improvements (collectively, “Alterations”) in or to the
Premises or make changes to locks on doors
or add, disturb or in any way change any plumbing or wiring without
obtaining the prior written
consent of Landlord, which consent shall not be withheld provided
that the Alterations would (i) not
adversely affect the Building Structure or Building Systems,
(ii) not affect the exterior appearance
of the Building or (iii) comply with applicable laws
(individually and collectively, a “Design
Problem”). Notwithstanding anything to the contrary set forth herein,Tenant shall not be required
to obtain Landlord’s prior consent with respect to any strictly cosmetic work performed within the
Premises by Tenant (i.e., paint, carpet and other similar alterations that do not affect the
Building Systems and Building Standard items).
(b)
Performance of Work. All Alterations shall be made at Tenant’s sole expense and by
contractors or mechanics selected by Tenant, subject to
Landlord’s reasonable approval, except that
Landlord shall have the right to require use of Building standard
contractors or mechanics for work
affecting the Building Systems or items under warranty (including,
but not limited to, the Building
roof). All Alterations shall be made at such times and in such manner
as Landlord may from time to
time reasonably designate, and shall become the property of Landlord without its obligation to pay
therefore at the expiration or earlier termination of this
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Lease. All work with respect to any Alterations shall be performed in a good and workmanlike
manner, shall be of a quality equal to or exceeding the then existing construction standards for
the Project and must be of a type, and the floors and ceilings must be finished in a manner,
customary for general office use. Alterations shall be diligently prosecuted to completion to the
end that the Premises shall be at all times a complete unit except during the period necessarily
required for such work. All Alterations shall be made strictly in accordance with all laws,
regulations and ordinances relating thereto and if interior improvements installed in the Premises
shall be removed, Tenant shall either replace same with interior improvements of the same or better
quality or repair the damage caused by the removal so the Premises is in good condition. Landlord
hereby reserves the right to require any contractor or mechanic working in the Premises to provide
lien waivers and liability insurance covering the Alterations to the Premises. In addition to the
foregoing, Tenant shall provide Landlord with evidence that Tenant or its contractor carries
“Builder’s All Risk” insurance in an amount reasonably approved by the Landlord covering the
construction of such Alterations, and such other insurance as the Landlord may reasonably require,
it being understood and agreed that all of such Alterations shall be insured by Tenant pursuant to
Section 14(a) of this Lease immediately upon completion thereof. Prior to the performance
of any Alterations, Tenant shall allow Landlord to enter the Premises and post appropriate notices
to avoid liability to contractors or material suppliers for payment for any Alterations. All
Alterations shall remain in and be surrendered with the Premises as a part thereof at the
expiration or earlier termination of this Lease, without disturbance, molestation or injury;
provided, however, that all of Tenant’s personal property, including furniture, trade fixtures, and
equipment, may be removed by Tenant at any time during the Term. Landlord may not require Tenant to
remove any Alterations (including cabling) or the Tenant Improvements from the Premises upon the
expiration or earlier termination of this Lease.
(c) Landlord’s Expenses; Administrative Fee. Tenant shall pay to Landlord, as
additional rent, any out-of-pocket costs incurred by Landlord in connection with the review and
approval of the Alterations and for any additional Building services provided to Tenant or to the
Premises in connection with any such alterations, additions or improvements which are beyond the
normal services provided to occupants of the Building as part of Operating Expenses. Under no
circumstances shall Landlord be liable to Tenant for any damage, loss, cost or expense incurred by
Tenant on account of Tenant’s plans and specifications, Tenant’s contractors or subcontractors, or
Tenant’s design of any work, construction of any work or delay in completion of any work.
9. TENANT’S PROPERTY.
(a) Removal Upon Expiration of Lease. All articles of personal property and all
business and trade fixtures, machinery and equipment, furniture and movable partitions owned by
Tenant or installed by Tenant at its expense in the Premises shall be and remain the property of
Tenant and may be removed by Tenant at any time during the Term, subject to the other requirements
of this Lease. If Tenant shall fail to remove all of such property from the Premises at the
expiration of the Term or within ten (10) days after any earlier termination of this Lease for any
cause whatsoever, Landlord may, at its option, on five (5) days’ notice to Tenant, remove the same
in any manner that Landlord shall choose, and store such property without liability to Tenant for
loss thereof. In such event, Tenant agrees to pay Landlord upon demand any and all reasonable
expenses incurred in such removal, including reasonable court costs and attorneys’
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fees and storage charges on such property for any length of time that the same shall be in
Landlord’s possession. Landlord may, at its option, without notice, sell said property or any of
the same, at private sale and without legal process, for such price as Landlord may obtain and
apply the proceeds of such sale to any amounts due under this Lease from Tenant to Landlord and to
the expense incident to the removal and sale of said property.
(b) Personal Property Taxes. Tenant shall be liable for and shall pay, at least five
(5) days before delinquency, all taxes levied against any personal property or trade fixtures
placed by Tenant in or about the Premises. If any such taxes on Tenant’s personal property or
trade fixtures are levied against Landlord or Landlord’s property or if the assessed value of the
Premises or Landlord’s obligations are increased by a value placed upon such personal property or
trade fixtures of Tenant and if Landlord, after written notice to Tenant, pays the taxes or
obligations based upon Tenant’s personal property or trade fixtures, which Landlord shall have the
right to do regardless of the validity thereof, but only under proper protest if requested by
Tenant, Tenant shall, within thirty (30) days of Landlord’s demand, repay to Landlord the taxes or
obligations so levied against Landlord, or the portion of such taxes or obligations resulting from
such increase in the assessment.
10. ENTRY BY LANDLORD. After not less than twenty four (24) hours prior notice (which may
be oral or written notice, notwithstanding anything to the contrary in this Lease governing the
manner of delivery of notices, and except that in the event of an emergency, Landlord may provide
shorter notice as may be required under the circumstances, which may be no prior notice, if
applicable under the circumstances of the applicable emergency situation), Landlord, its
authorized agents, contractors, and representatives shall at any and all times have the right to
enter the Premises to inspect the same, to supply janitorial service and any other service to be
provided by Landlord to Tenant hereunder, to show the Premises to prospective purchasers or (only
during the final six (6) months of the Term) tenants, to post notices, to alter, improve or repair
the Premises or any other portion of the Building, all without being deemed guilty of any eviction
of Tenant and without abatement of rent (except as otherwise provided in this Lease). Except in
the event of an emergency, Landlord shall endeavor to coordinate any such entry with Tenant, so as
to minimize the extent of any unreasonable interference with Tenant’s business operations to the
extent practicable under the circumstances. Landlord may, in order to carry out such purposes,
erect scaffolding and other necessary structures where reasonably required by the character of the
work to be performed, provided that the business of Tenant shall be interfered with as little as
is reasonably practicable. Landlord shall at all times have and retain a key with which to unlock
all doors in the Premises, excluding Tenant’s vaults and safes, Landlord shall have the right to
use any and all means which Landlord may deem proper to open said doors in an emergency in order
to obtain entry to the Premises. Any entry to the Premises obtained by Landlord pursuant to the
terms hereof shall not be deemed to be a forcible or unlawful entry into the Premises, or an
eviction of Tenant from the Premises or any portion thereof, and Tenant hereby waives any claim
for damages for any injury or inconvenience to or interference with Tenant’s business, any loss of
occupancy or quiet enjoyment of the Premises, and any other loss in, upon and about the Premises
except to the extent caused by the gross negligence or willful misconduct of Landlord.
Notwithstanding anything to the contrary set forth above, Tenant may designate certain areas of
the Premises as “Secured Areas” should Tenant require such areas for the purpose of securing
certain valuable property or confidential information. Landlord may not enter such Secured Areas
except in the
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case of emergency or in the event of a Landlord inspection, in which case Landlord shall provide
Tenant with five (5) days’ prior written notice of the specific date and time of such Landlord
inspection.
11. LIENS. Tenant shall keep the Premises, the Building and the Project free from any
liens or encumbrances of any kind or nature arising out of any work performed, materials ordered
or obligations incurred by or on behalf of Tenant.
12. INDEMNIFICATION.
(a) Indemnity by Tenant. Except to the extent caused by the negligence or
willful misconduct of Landlord or its members, partners, managers, shareholders, officers,
directors,trustees, employees, agents or contractors (collectively, the “Landlord Parties”) and
not covered by the insurance maintained by Tenant (and which would not have been so covered
had Tenant maintained the insurance required to be maintained by Tenant under this Lease),
Tenant shall indemnify, defend, and hold harmless Landlord, Landlord’s members,
shareholders, partners, trustees and the Landlord’s Parties from and against all losses,
liabilities, damages, costs, expenses and claims arising from or relating to (a) Tenant’s use of the
Premises or the conduct of its business or any activity, work, or thing done, permitted or suffered
by Tenant in or about the Premises, (b) any act, neglect, fault or omission of any of the Tenant
Parties, and (c) all reasonable costs, attorneys’ fees, expenses and liabilities incurred in or
about such claims or any action or proceeding brought thereon. In case any action or proceeding
shall be brought against any of the Landlord Parties by reason of any such claim, Tenant upon
written notice from Landlord shall defend the same at Tenant’s expense by counsel reasonably
approved in writing by Landlord. Tenant, as a material part of the consideration to Landlord, hereby
assumes all risk of and waives all claims against the Landlord Parties with respect to damage to
property or injury to persons in, upon or about the Premises from any cause whatsoever except that
which is caused by the negligence or willful misconduct of Landlord or the Landlord Parties or by
the failure of Landlord to observe any of the terms and conditions of this Lease where such failure
has persisted for an unreasonable period of time after written notice to Landlord of such failure.
(b) Indemnity by Landlord. Except to the extent caused by the negligence or
willful misconduct of Tenant or any of the Tenant Parties or any of Tenant’s members,
partners, managers, shareholders, officers, directors, trustees or agents (all of the foregoing
including Tenant and Tenant Parties are collectively referred to herein as the “Tenant Indemnitees”)
and not covered by the insurance maintained by Landlord (and which
would not have been so covered had
Landlord maintained the insurance required to be maintained by
Landlord under this Lease), Landlord
shall indemnify, defend, and hold harmless Tenant and the Tenant
Indemnitees from and against all
losses, liabilities, damages, costs, expenses and claims arising from
or relating to (a) any
occurrence on the common areas of the Project, or (b) any claim
arising from the negligence or
willful misconduct of Landlord or any of the Landlord Parties and not
covered by the insurance
maintained by Tenant (and which would not have been so covered had
Tenant maintained the insurance
required to be maintained by Tenant under this Lease), and
(c) all reasonable costs, attorneys’
fees, expenses and liabilities incurred in or about such claims or
any action or proceeding brought
thereon. In case any action or proceeding shall be brought against any of the Tenant Indemnitees by
reason of any such claim, Landlord upon written notice from
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Tenant shall defend the same at Landlord’s expense by counsel reasonably approved in writing by
Tenant.
13.
DAMAGE TO TENANT’S PROPERTY. Notwithstanding anything to the contrary in this Lease,
the Landlord Parties shall not be liable for (a) any damage to
any property entrusted to employees
of the Project or its property managers, (b) loss or damage to
any property by theft or otherwise,
(c) any injury or damage to persons or property resulting from
fire, explosion, falling plaster,
steam, gas, electricity, water or rain which may leak from any part
of the Building or from the
pipes, appliances or plumbing work therein or from the roof, street
or sub-surface or from any other
place or resulting from dampness or any other cause whatsoever, or
(d) any damage or loss to the
business or occupation of Tenant arising from the acts or neglect of
other tenants or occupants of,
or invitees to, the Project, except to the extent that such damage is due tothe negligence or
willful misconduct of Landlord or any of the Landlord Parties or the
breach of this Lease by
Landlord. Tenant shall give prompt written notice to Landlord in case
of fire or accident in the
Premises or in the Building or of defects therein or in the fixtures or equipment.
14. INSURANCE.
(a) Tenant’s Insurance. Tenant shall, during the entire Term of this Lease and any
other period of occupancy, at its sole cost and expense, keep in full force and affect the
following insurance:
(1)
Standard form property insurance insuring against the perils of fire, vandalism, malicious
mischief, cause of loss-special form (“All-Risk”),
sprinkler leakage and earthquake sprinkler
leakage. This insurance policy shall be upon all trade fixtures and
other property owned by
Tenant, for which Tenant is legally liable and/or that was installed
by or on behalf of Tenant, and
which is located in the Building, including, without limitation,
Alterations, furniture, fittings,
installations, fixtures, Tenant Improvements and any other personal
property, in an amount not less
than the full replacement cost thereof. If there shall be a dispute
as to the amount which
comprises full replacement cost, the decision of Landlord or any
mortgagees of Landlord shall be
presumptive.
(2) Commercial
General Liability Insurance insuring Tenant against any liability arising out of
the lease, use, occupancy, or maintenance of the Premises and all
areas appurtenant thereto. Such
insurance shall be in the amount of Two Million Dollars ($2,000,000)Combined Single Limit for
injury to or death of one or more persons in an occurrence and Three Million Dollars ($3,000,000)
aggregate, and for damage to tangible property (including loss of use) in an occurrence, with an
Additional Insured — Landlord Endorsement. The policy shall insure the hazards of premises and
operations, independent contractors, contractual liability (covering the indemnity contained in
Section 12 hereof) and shall (i) name Landlord as an additional insured, (ii) contain a
cross-liability provision, (iii) contain a provision that
“the insurance provided the landlord
hereunder shall be primary and noncontributing with any other insurance available to the landlord,”
and (iv) include fire legal liability coverage in the amount of One Million Dollars ($1,000,000).
(3)
Workers’ Compensation and Employer’s Liability Insurance (as required by state law).
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(4)
If Tenant installs with prior approval of the landlord, any boiler, pressure object,
machinery, fire suppression system, supplemental air conditioning or
other mechanical equipment
within the Premises, Tenant shall also obtain and maintain at
Tenant’s expense, boiler and machinery
insurance covering loss arising from the use of such equipment.
(5)
Any other form or forms of insurance as Tenant or Landlord or any mortgagees of Landlord
may reasonably require from time to time in form, amounts and for insurance risks against which a
prudent tenant would protect itself and then being required by other reasonable and prudent
landlords of Comparable Buildings of tenants comparable to Tenant.
(6)
Notwithstanding the foregoing or any other provision of this Lease, Tenant shall have the
right to self insure. Tenant shall have the option, either alone or
in conjunction with any
subsidiaries or affiliates of Tenant, to maintain self insurance
and/or provide or maintain any
insurance required by this Lease under blanket insurance policies maintained by Tenant or
provide or maintain insurance through such alternative risk management programs as Tenant
may provide or participate in from time to time.
All such policies shall be written in a form reasonably satisfactory to Landlord and shall be taken
out with insurance companies qualified to issue insurance in the State of California and holding an
A.M. Best’s Rating of “A-” and a Financial Size Rating of “VII” or better, as set forth in the most
current issue of Best’s Key Rating Guide. Such insurance shall provide that it is primary
insurance, and not contributory with any other insurance in force for or on behalf of Landlord.
Prior to the commencement of the Term, Tenant shall deliver to Landlord certificates of insurance
evidencing the existence of the amounts and forms of coverage required above and, except for the
All-Risk insurance, naming Landlord and any other person specified by Landlord, as an additional
insured. No such policy shall be cancelable, terminable or reducible in coverage except after
thirty (30) days prior written notice to Landlord. Tenant shall, within ten (10) days prior to the
expiration of such policies, furnish Landlord with renewals or “binders” thereof, or Landlord may,
on five (5) days notice to Tenant, order such insurance and charge the cost thereof to Tenant as
additional rent, if Tenant fails to so notify Landlord. If Landlord obtains any insurance that is
the responsibility of Tenant under this Section 14, Landlord shall deliver to Tenant a
written statement setting forth the cost of any such insurance and showing in reasonable detail the
manner in which it has been computed.
(b) Landlord’s Insurance. Landlord shall, during the entire term of this Lease,
as an item of Operating Expenses, keep in full force and affect the following insurance:
(1) All Risk insurance (including a vandalism and malicious mischief endorsement and
sprinkler leakage coverage, and also covering such other risks as Landlord or Landlord’s lender
may require) upon the Project (excluding any property which Tenant is obligated to insure under
Section 14(a) above) in an amount not less than the full replacement cost thereof
(excluding footings, foundations and excavation), and including commercially reasonable rental
loss coverage for losses covered by such insurance policy. Such insurance policy or policies shall
name Landlord as a named insured. The deductible under the All Risk policy shall not exceed such
commercially reasonable amount as Landlord reasonably
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determines to be appropriate given prudent risk management practices and the practices of
comparable landlords of Comparable Buildings.
(2) Commercial general liability insurance coverage, including personal injury, bodily
injury, broad form property damage, automobile, Premises operations hazard, contractual liability,
and products and completed operations liability, in the amount of One Million Dollars ($1,000,000)
Combined Single Limit for injury to or death of one or more persons in an occurrence and Five
Million Dollars ($5,000,000) aggregate.
Landlord may satisfy its insurance obligations under this Lease by blanket, umbrella and/or, as to
liability coverage in excess of One Million Dollars ($1,000,000), excess liability coverage. All
such policies shall be taken out with insurance companies qualified to issue insurance in the
State of California and holding an A.M. Best’s Rating of “A” and a Financial Size Rating of “VIII”
or better, as set forth in the most current issue of Best’s Key Rating Guide. Upon request,
Landlord shall deliver to Tenant certificates evidencing Landlord’s maintenance of insurance in
compliance with Landlord’s insurance requirements set forth in this Lease.
15.
WAIVER OF SUBROGATION. Whether any loss or damage to or within the Project, the
Building and/or the Premises is due to the negligence of either of
the parties hereto, their agents
or employees, Landlord and Tenant do each herewith and hereby release
and relieve the other from
responsibility for, and waive their entire claim of recovery, for any
loss or damage to the real or
personal property of the other located anywhere in the Project and
including the Project itself,
arising out of or incident to the occurrence of any of the perils
which are covered by any fire
insurance policy covering the Project (or would have been covered by
any fire insurance policy
covering the Project had the applicable party carried the insurance
required to be carried
hereunder). To the extent that such risks above are, in fact, covered
by insurance, each party
shall cause its insurance carriers to consent to such waiver and to
waive all rights of subrogation
against the other party. Notwithstanding the foregoing, no such
release shall be effective unless
the aforesaid insurance policy or policies shall expressly permit
such a release or contain a waiver
of the carrier’s right to be subrogated.
16. CASUALTY. If the Building and/or the Premises are damaged by fire or other
perils covered by insurance carried by Landlord, Landlord and Tenant shall have the following
rights and obligations:
(a) Repair and Restoration.
(1) If the Building and/or the Premises are damaged or destroyed by any such peril to the
extent that the Building and/or the Premises cannot reasonably be repaired, reconstructed and
restored within one hundred eighty (180) days from the date of such damage or destruction,
Landlord shall, at its sole option, as soon as reasonably possible thereafter, either (i) commence
or cause the commencement of the repair, reconstruction and restoration of the Building and/or the
Premises to substantially their condition existing immediately prior to such casualty, and
prosecute or cause the same to be prosecuted diligently to completion, in which event this Lease
shall remain in full force and effect; or (ii) within thirty (30) days after such damage or
destruction, elect not to so repair, reconstruct or restore the Building and/or the Premises, in
which event this Lease shall terminate. In either event, Landlord shall give Tenant
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written notice of its intention within said thirty (30) day period. If Landlord elects not to
restore the Building and/or the Premises, this Lease shall be deemed to have terminated as of the
date of such damage or destruction.
(2) If the Building and/or the Premises are partially damaged or destroyed by any such peril
to the extent that the Building and/or the Premises reasonably may be repaired, reconstructed or
restored within a period of one hundred eighty (180) days from the date of such damage or
destruction, then Landlord shall commence or cause the commencement of and diligently complete or
cause the completion of the work of repair, reconstruction and restoration of the Building and/or
the Premises to substantially their condition existing immediately prior to such casualty and this
Lease shall continue in full force and effect.
(b) Uninsured Casualties. If damage or destruction of the Building and/or
the Premises is due to any cause not covered by collectible insurance carried by Landlord at the
time of such damage or destruction and the costs of such repair
exceed Five Hundred Thousand Dollars
($500,000.00), Landlord may elect to terminate this Lease, provided
that Landlord may only elect to
terminate this Lease if Landlord also terminates the leases of all of
Building tenants. If the
repairing or restoring of the damage is delayed or prevented for
longer than two hundred forty (240)
days after the occurrence of such damage or destruction by reason of
weather, acts of God, war,
governmental restrictions, inability to procure the necessary labor
or materials, or any cause that
is beyond the reasonable control of Landlord, Landlord may elect to
be relieved of its obligation to
make such repairs or restoration and terminate this Lease, in which
case Landlord shall provide
Tenant with thirty (30) days written notice of its intent to
terminate this Lease. Further, Landlord
shall not have any obligation to repair, reconstruct or restore the
Premises and may terminate this
Lease when the damage resulting from any casualty covered under this Section 16 occurs
during the last twelve (12) months of the Term and the Premises
cannot be repaired, reconstructed or
restored within thirty (30) days after the date of the casualty.
(c)
Tenant’s Termination Right. Notwithstanding anything to the contrary contained in
this Lease, in the event of material casualty damage to the Premises
not resulting in termination of
this Lease by Landlord, Landlord shall deliver written notice to
Tenant within thirty (30) days
following such casualty damage or occurrence setting forth
Landlord’s good faith estimate of the
time required for completion of repair and/or restoration of the
Premises, and if such estimated
time exceeds one hundred eighty (180) days from the occurrence
of the casualty, Tenant may elect to
terminate this Lease by written notice to Landlord delivered within twenty (20) days following
Tenant’s receipt of such estimate notice. In addition, in the
event such repair and/or restoration
of the Premises is not actually completed within two hundred forty (240) days from the occurrence of
the casualty (or such longer time period as may have been estimated in such notice to Tenant),
Tenant may elect to terminate this Lease upon thirty (30) days prior written notice to Landlord,
provided that if such repair and/or restoration is completed within such thirty (30) day period,
such election to terminate shall be nullified and this Lease shall continue in full force and
effect. In addition, and notwithstanding anything to the contrary contained in this Lease, if the
Premises or the Building is wholly or partially damaged or destroyed within the final twelve (12)
months of the Term of this Lease so that Tenant shall be prevented from using the Premises for
thirty (30) consecutive days due to such damage or destruction, then Tenant may, at its option, by
notice to Landlord within sixty (60) days after the occurrence of such damage or destruction, elect
to terminate this Lease.
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(d) Termination of Lease. Upon any termination of this Lease under any of the
provisions of this Section 16, Landlord and Tenant shall each be released without further
obligation to the other from the date possession of the Premises is surrendered to Landlord or such
other date as is mutually agreed upon by Landlord and Tenant except for payments or other
obligations which have theretofore accrued and are then unpaid or unperformed.
(e) Rent Abatement. In the event of repair, reconstruction and restoration by or
through Landlord as herein provided, the rent payable under this Lease (including Basic Rent and
Tenant’s Proportionate Share of Operating Expenses) shall be abated in the proportion that the
rentable area of the portion of the Premises that Tenant is prevented from using, and does not use,
bears to the total rentable area of the Premises. However, in the event that Tenant is prevented
from conducting, and does not conduct, its business in any portion of the Premises and the
remaining portion of the Premises is not sufficient to allow Tenant to effectively conduct its
business therein, and if Tenant does not conduct its business from such remaining portion, then the
rent for the entire Premises shall be abated. Tenant’s abatement period shall continue until
Tenant has been given sufficient time, and sufficient access to the Premises, the parking
facilities and/or the Building, to rebuild such portion it is required to rebuild, to install its
property, furniture, fixtures, and equipment to the extent the same shall have been removed and/or
damaged as a result of such damage or destruction. Tenant shall not be entitled to any
compensation or damages for loss of the use of the whole or any part of the Premises and/or any
inconvenience or annoyance occasioned by such damage, repair, reconstruction or restoration, nor
shall Tenant be entitled to any insurance proceeds, including those in excess of the amount
required by Landlord for such repair, reconstruction or restoration. Tenant shall not be released
from any of its obligations under this Lease due to damage or destruction of the Building and/or
the Premises except to the extent and upon the conditions expressly stated in this Section
16.
(f) Extent of Repair Obligation. If Landlord is obligated to or elects to repair or
restore as herein provided, Landlord shall be obligated to make repair or restoration only of those
portions of the Building and the Premises which were originally provided at Landlord’s expense, and
the repair and restoration of items not provided at Landlord’s expense shall be the obligation of
Tenant, except that Tenant shall be responsible for the repair of all Tenant Improvements performed
by Tenant under Section 30 below. Tenant shall be entitled to all insurance proceeds
payable to or received by Tenant in connection with the Tenant Improvements or any other
improvements insured by the Tenant pursuant to Section 14 hereof.
(g) Waiver. The provisions of California Civil Code § 1932(2) and § 1933(4), which
permit termination of a lease upon destruction of the Premises, are hereby waived by Tenant; and
the provisions of this Section 16 shall govern in case of such destruction.
17. CONDEMNATION.
(a) Complete Taking. If the whole of the Project, the Building or the Premises or so
much thereof shall be taken by condemnation or in any other manner for any public or quasi-public
use or purpose so that the Premises will no longer be reasonably suitable for Tenant’s continued
occupancy (as reasonably determined by Tenant), this Lease and the term and estate hereby granted
shall terminate as of the date that possession of the Project, the Building or the
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Premises is so taken (herein called “Date of the Taking”), and the Basic Rent and other sums
payable hereunder shall be prorated and adjusted as of such termination date.
(b) Partial Taking. If only a part of the Building, the Project or the Premises shall
be so taken and the remaining part thereof after reconstruction is reasonably suited for Tenant’s
continued occupancy (as reasonably determined by Tenant), this Lease shall be unaffected by such
taking, except that Landlord may, at its option, terminate this Lease by giving Tenant written
notice to that effect within sixty (60) days after the Date of the Taking provided that in such
event, Landlord also terminates the leases of all other Building tenants. In such event, this
Lease shall terminate on the date that such notice from the Landlord to Tenant shall be given, and
the Basic Rent and other sums payable hereunder shall be prorated and adjusted as of such
termination date. Upon a partial taking after which this Lease continues in force as to any part of
the Premises, the Basic Rent and other sums payable hereunder shall be adjusted according to the
rentable area remaining.
(c) Award. Landlord shall be entitled to receive the entire award or payment in
connection with any taking without deduction therefrom for any estate vested in Tenant by this
Lease, and Tenant shall receive no part of such award, including any award for the “leasehold bonus
value” of this Lease, provided that Tenant shall be entitled to make a separate claim for its
relocation expenses, the value of its personal property and fixtures belonging to Tenant actually
taken, the value of the Tenant Improvements and other improvements to the extent paid for by Tenant
and for the interruption of or damage to Tenant’s business (not attributable to the “leasehold
bonus value” of this Lease). Tenant hereby expressly assigns to Landlord all of its right, title
and interest in and to any award or payment attributable to the “leasehold bonus value” of this
Lease.
(d) Waiver. Except as may be otherwise provided herein, Tenant hereby waives and
releases any right to terminate this Lease under Sections 1265.120 and 1265.130 of the California
Code of Civil Procedure or under any similar law, statute or ordinance now or hereafter in effect
relative to eminent domain, condemnation or takings.
18. ASSIGNMENT OR SUBLETTING.
(a) Landlord’s Consent. Without the express prior written consent of Landlord,
which consent shall not be unreasonably withheld, conditioned or delayed, Tenant shall not directly
or indirectly, voluntarily or by operation of law, sell, assign, encumber, pledge, or otherwise
transfer or hypothecate all of its interest in or rights with respect to the Premises
(collectively, “Assignment”), or permit all or any portion of the Premises to be occupied by anyone
other than Tenant or sublet all or any portion of the Premises or transfer a portion of its
interest in or rights with respect to the Premises (collectively, “Sublease”).
(b) Notice to Landlord. If Tenant desires to enter into an Assignment or a Sublease,
Tenant shall give written notice to Landlord of its intention to do so (the “Transfer Notice”),
containing (i) the name of the proposed assignee or subtenant (collectively, “Transferee”), (ii)
the nature of the proposed Transferee’s business to be carried on in the Premises, (iii) the
material terms of the proposed Assignment or Sublease, including, without limitation, the
commencement and expiration dates thereof and the rent payable thereunder, (iv) the portion of
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the
Premises proposed to be assigned or subleased (the “Transfer
Space”), (v) and the most recent
financial statement or other equivalent financial information reasonably available to Tenant
concerning the proposed Transferee. Within fifteen (15) days after Landlord’s receipt of the
Transfer Notice, Landlord shall, by written notice to Tenant, elect to (1) consent to the Sublease
or Assignment, or (2) disapprove the Sublease or Assignment; provided, however, that Landlord
agrees not to unreasonably withhold its consent to the Sublease or Assignment. Landlord’s consent
shall not be deemed to have been unreasonably withheld if the Transferee is a new concern with no
previous business history or if the Transferee intends to use the Premises (x) for executive suites
or any other use inconsistent with Section 6 or the operation of a first- class office
building or (y) in a manner which would increase the use of, or the possibility of disturbance of,
Hazardous Substances on the Property. Landlord’s failure to make such election within fifteen (15)
days after Landlord’s receipt of the Transfer Notice shall be deemed to be Landlord’s approval of
the proposed Sublease or Assignment.
(c) Permitted Transfers. If Landlord consents to any Sublease or Assignment as
set forth in Section 18(b):
(1) Tenant may thereafter, within one hundred eighty (180) days after Landlord’s consent,
enter into such Assignment or Sublease, but only with the party and upon substantially the same
terms as set forth in the Transfer Notice, provided, however, that the financial terms contained in
the Assignment or Sublease shall be no less favorable to Tenant than those set forth in the
Transfer Notice.
(2) In the case of a Sublease, Tenant shall pay to Landlord fifty percent (50%) of the
difference between (x) any and all sums actually received by Tenant in connection with such
Sublease (including key money, bonus money and any payment in excess of fair market value for (A)
services rendered by Tenant in connection with such Sublease or (B) assets, fixtures, inventory,
equipment or furniture transferred by Tenant in connection with such Sublease, but expressly
excluding any payment up to the fair market value for the items referenced in the foregoing clauses
(A) and/or (B)), minus (y) the sum of the proportionate amount (on a rentable square footage basis)
of rent (including Basic Rent and Tenant’s Proportionate Share of Operating Expenses) payable by
Tenant under this Lease for the Transfer Space plus any actual and reasonable out-of-pocket costs
incurred by the Tenant in connection with such Sublease (including brokerage commissions, legal
fees, improvement costs for work for the benefit of the subtenant, improvement allowances or other
monetary concessions or inducements provided to the subtenant, the gross revenue as to the Transfer
Space paid to Landlord by Tenant for all days the Transfer Space was vacated from the date that
Tenant first vacated the Transfer Space until the date the subtenant was to pay rent, costs of
advertising the space for sublease and unamortized cost of initial and subsequent improvements to
the Premises by Tenant [collectively, the “Transfer Costs”]), which amounts shall not be paid by
Tenant to Landlord until Tenant has recovered its Transfer Costs. Once Tenant has recouped its
Transfer Costs, Tenant shall pay Landlord its share of the amounts due hereunder on a monthly
basis.
(3) In the case of an Assignment, Tenant shall pay to Landlord fifty percent (50%) of any
transfer or assignment fee, purchase price or other consideration received by Tenant in connection
with the Assignment attributable to the value of this Lease (but Landlord shall not be entitled to
any proceeds paid for the sale of Tenant’s business which are not related
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to the value of this Lease or for the fair market value of any assets, fixtures, inventory,
equipment or furniture transferred by Tenant in connection with such Assignment) less the Transfer
Costs, which amounts shall be paid by Tenant to Landlord as provided in Section 18(c)(2)
above.
(4) Any Sublease or Assignment shall be subject to all of the provisions of this Lease, and
Landlord’s consent to any Sublease or Assignment shall not be construed as a consent to any terms
thereof which conflict with any of the provisions of this Lease except to the extent that Landlord
specifically agrees in writing to be bound by such conflicting terms.
(d) Continuing Liability. Tenant shall not be relieved of any obligation to be
performed by Tenant under this Lease, including the obligation to obtain Landlord’s consent to any
other Assignment or Sublease, regardless of whether Landlord consented to any Assignment or
Sublease. Any Assignment or Sublease that fails to comply with this Section 18 shall be
void. The acceptance of Basic Rent or other sums by Landlord from a proposed Transferee shall not
constitute Landlord’s consent to such Assignment or Sublease.
(e) Assumption by Transferee. Each Transferee under an Assignment shall assume all
obligations of Tenant under this Lease and shall be and remain liable jointly and severally with
Tenant for the payment of Basic Rent, additional rent and other charges, and for the performance of
all other provisions of this Lease. Each Transferee under a Sublease shall be subject to this
Lease. No Assignment shall be binding on Landlord unless Landlord shall receive a counterpart of
the Assignment and an instrument that contains a covenant of assumption by the Transferee
reasonably satisfactory in substance and form to Landlord and consistent with the requirements of
this Section 18 but the failure of the Transferee to execute such instrument shall not
release the Transferee from its liability as set forth above. Tenant shall reimburse Landlord,
within thirty (30) days after Tenant’s receipt of an invoice therefore, for any reasonable costs
(not to exceed $1,000) that Landlord may incur in connection with any proposed Assignment or
Sublease, including Landlord’s reasonable attorneys’ fees and the costs of investigating the
acceptability of any proposed Transferee.
(f) Default; Waiver. Any Assignment or Sublease in violation of this Section 18
shall be void. The acceptance of rent or additional charges by Landlord from a purported assignee
or sublessee shall not constitute a waiver by Landlord of the provisions of this Section
18.
(g) Intentionally Omitted.
(h) Use by Affiliates. Tenant shall have the right, without consent of Landlord, to
assign this Lease or to sublease all or any portion of the Premises, to (i) any person or entity
which, directly or indirectly, controls Tenant or is controlled by Tenant or is under common
control with Tenant, (ii) any successor to Tenant by merger, consolidation or other operation of
law, (iii) any person or entity to whom all or substantially all of the assets of Tenant are
conveyed or (iv) any person or entity purchasing the business which the Tenant conducts at the
Premises so long as the Premises are used in a manner consistent with the requirements of this
Lease. The term “control” shall mean ownership, directly or indirectly, of more than fifty percent
(50%) of the equity and voting interests of Tenant or such entity, as the case may be.
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(i) Recognition Agreement. To the extent that Tenant enters into a Sublease for all of
the Premises, Landlord, if it grants its consent to such Sublease, shall also simultaneously
execute and deliver a recognition agreement pursuant to which Landlord shall agree that in the
event Tenant defaults under this Lease and this Lease is terminated, the Sublease shall be
recognized as a direct lease between Landlord and the subtenant on the terms and conditions of the
sublease to the extent same are not inconsistent with, or contrary to, the provisions of this Lease
and at a rental rate which is the higher of the rental rate under this Lease or the rental rate
under the sublease.
(j) Occupancy By Others. Tenant may allow any person or company which is a client or
customer of Tenant or which is providing service to Tenant or one of Tenant’s clients to occupy
certain portions of the Premises without such occupancy being deemed an assignment or subleasing
as long as no new demising walls are constructed to accomplish such occupancy and as long as such
relationship was not created as a subterfuge to avoid the obligations set forth in this
Section 18.
19. SUBORDINATION AND NON-DISTURBANCE. Subject to the last sentence of this Section 19,
Tenant agrees that this Lease is and shall be subordinate to any mortgage, deed of trust, ground
lease, underlying lease or other prior lien (hereinafter “Prior Lien”) that may heretofore or
hereafter be placed upon the Project or the Building, and all renewals, replacements and extensions
thereof. If any Prior Lien holder wishes to have this Lease prior to its Prior Lien, then and in
such event, upon such Prior Xxxx xxxxxx’x notifying Tenant to that effect, this Lease shall be
deemed prior to the Prior Lien. If any ground lease or underlying lease terminates for any reason
or any mortgage or deed of trust is foreclosed or a conveyance in lieu of foreclosure is made for
any reason, Tenant shall, notwithstanding any subordination, attorn to and become the tenant of the
successor in interest to Landlord, provided that such successor in interest recognizes the interest
of Tenant under this Lease if no default under this Lease then exists beyond all applicable notice
and cure periods. Within fifteen (15) days of presentation, Tenant shall execute any documents
which any such Prior Lien holder may require to effectuate the provisions of this Section
19. Notwithstanding anything to the contrary contained herein, Tenant’s obligation to
subordinate this Lease to the holder of any Prior Lien hereafter placed upon the Project or the
Building shall be conditioned upon such Prior Xxxx xxxxxx’x executing and delivering to Tenant an
agreement of subordination, non-disturbance and adornment with Tenant in commercially reasonable
form reasonably designated by such Prior Lien holder and reasonably acceptable to Tenant in which
the Prior Lien holder agrees not to disturb Tenant in its possession of the Premises. Landlord
represents and warrants to Tenant that as of the date hereof, the Building and Project are not
subject to any ground lease, mortgage or lien.
20. ESTOPPEL
CERTIFICATE. Tenant will, upon ten (10) business days prior request by
Landlord, execute, acknowledge and deliver to Landlord a statement in writing executed by Tenant,
substantially in the form of Exhibit D attached hereto, certifying, among other things, the date of
this Lease, that this Lease is unmodified and in full force and effect (or, if there have been
modifications, that this Lease is in full force and effect as modified, and setting forth such
modifications) and the date to which the Basic Rent and additional rent and other sums payable
hereunder have been paid, and either stating that to the knowledge of Tenant no default exists
hereunder on the part of Landlord or Tenant or specifying each such default of which Tenant may
have knowledge and such other matters as may be reasonably requested by Landlord. The
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parties agree and intend that any such statement by Tenant may be relied upon by any prospective
purchaser or mortgagee of the Building or the Project. Tenant’s failure to timely deliver such a
statement shall be deemed to be an acknowledgment by Tenant that this Lease is in full force and
effect without modification (except as set forth by Landlord), there are no uncured defaults under
this Lease by Landlord and no more than one monthly installment of Basic Rent and additional rent
and other sums payable hereunder have been paid in advance. Landlord will, upon ten (10) business
days prior request by Tenant, execute, acknowledge and deliver to Tenant a statement in writing
executed by Landlord substantially in the form of Exhibit D attached hereto with such
changes as may be required when Tenant is the requesting party.
21. SERVICES.
(a) Standard Services. Landlord shall maintain the public and common areas of
the Project and the Building, such as lobbies, stairs, corridors and restrooms, in first-class
condition and state of repair consistent with Comparable Buildings, except for damage occasioned
by the acts or omissions of the Tenant Parties, which shall be repaired at Tenant’s sole cost and
expense except to the extent the cost of such repair is covered by insurance carried by Landlord
(or would have been covered had Landlord carried the insurance required to be carried hereunder).
Landlord shall be solely responsible for providing janitorial services to the Premises comparable
to janitorial services provided in Comparable Buildings. Notwithstanding the foregoing, Tenant may
elect, from time to time with respect to any calendar month(s), by delivery of written notice to
Landlord not less than forty-five (45) calendar days prior to the commencement of such month(s),
to be responsible for providing janitorial services to the Premises, or to a portion thereof as
specified in such notice, which janitorial services shall be consistent with those janitorial
services provided by Landlord to other tenants in the Building, in which event Tenant shall be
responsible to perform such janitorial services in such month(s) and Tenant shall receive a
monthly credit to the Basic Rent due hereunder for such respective month(s), on a month-by- month
basis, in an amount equal to $.07 per rentable square foot of space for that portion of the
Premises as specified in such notice for which Tenant so elects to provide such janitorial
services. Tenant shall have access to the Premises and Project parking garage at all times.
Landlord shall furnish the Premises with a minimum of seven (7) xxxxx consumed load per rentable
square foot within the Premises of electric power (in addition to the electrical power required
for lighting and base Building HVAC) for operation of typical general office machines, hot and
cold running water to restrooms, hot and cold water to the kitchen facility within the Premises
(through piping to be installed as a part of the Tenant Improvements) and elevator service
(including the use of one elevator as a freight elevator for deliveries and construction purposes,
but subject to availability based upon common use of such elevator with other Building occupants)
at all times during the Term. Landlord shall furnish the Premises with heating or normal office
air conditioning comparable to the amounts being provided by comparable landlords of Comparable
Buildings between the hours of 6:00 a.m. and 6:00 p.m., Monday through Friday, except for New York
Stock Exchange-recognized holidays, and between the hours of 9:00 a.m. and 12:00 p.m. on Saturday.
Supplemental air conditioning units and electricity therefore or special air conditioning
requirements, such as for any computer centers, and after-hours heating and air conditioning shall
be at Tenant’s expense at an hourly rate established by the Landlord as its Actual Cost (as
hereinafter defined). For purposes hereof, “Actual Cost” shall mean the actual out-of-pocket
incremental extra cost to Landlord to provide
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additional services without markup for profit, overhead, depreciation or administration (to the
extent Landlord’s administration costs are duplicative of amounts being paid by Tenant as part of
Operating Expenses). After hours heating and air conditioning shall be charged by the Landlord to
the Tenant at the rate of $37.00/hour and shall be payable by the Tenant as Additional Rent within
thirty (30) days after receipt of an invoice therefore. Tenant shall be solely responsible for the
repair and maintenance of any separate heating, ventilating, air conditioning or other equipment
installed in the Premises by the Tenant (with the Landlord’s consent). Landlord shall also provide
lighting replacement for Landlord-furnished lighting, toilet room supplies, window washing with
reasonable frequency as is provided in other Comparable Buildings and janitorial service to all
common areas and garages of the Property comparable to that provided in Comparable Buildings.
Landlord shall not be liable to Tenant for any loss or damage caused by or resulting from any
variation, interruption or failure of said services due to any cause whatsoever; and no temporary
interruption or failure of such services incident to the making of repairs, Alterations or
improvements due to accident or strike or conditions or events not under Landlord’s control shall
be deemed an eviction of Tenant or relieve Tenant from any of Tenant’s obligations hereunder unless
otherwise provided in this Lease.
(b) Overstandard Use. Tenant shall not, without the Landlord’s prior written consent,
use heat-generating machines, machines other than normal office machines, or equipment or lighting
located in the Premises, which may materially affect the temperature otherwise maintained by the
air conditioning system or increase the water normally furnished for the Premises by Landlord.
If such consent is given, Landlord shall have the right to install supplementary air conditioning
units or other facilities in the Premises, including supplementary or additional metering devices,
and the Actual Cost thereof, including the Actual Cost of installation, operation and maintenance
shall be paid by Tenant to Landlord within thirty (30) days of billing by Landlord. If Tenant
uses water or electricity in excess of that supplied by Landlord pursuant to subsection (a) above,
Tenant shall pay to Landlord, within thirty (30) days of billing, the Actual Cost of such excess
consumption, the cost of the installation, operation and maintenance of equipment which is
installed in order to supply such excess consumption; and Landlord may install devices to
separately meter any increased use and in such event Tenant shall pay the increased cost directly
to Landlord, within thirty (30) days of demand, including the Actual Cost of such additional
metering devices (including installment costs).
(c) Abatement of Rent. Notwithstanding the foregoing or anything in this Lease to the
contrary, in the event that Tenant is prevented from using, and does not use, the Premises or any
portion thereof, for three (3) consecutive business days or ten (10) business days in any twelve
(12) month period (the “Eligibility Period”) as a result of (i) any repair, maintenance or
alteration performed by Landlord after the Commencement Date that substantially interferes with
Tenant’s use of the Premises, the parking facility and/or the Building, or (ii) any failure by
Landlord to provide Tenant with services or access to the Premises, the Parking Facility and/or the
Building, then Tenant’s Rent shall be abated or reduced, as the case may be, after expiration of
the Eligibility Period for such time that Tenant continues to be so prevented from using, and does
not use, the Premises or a portion thereof, in the proportion that the rentable area of the portion
of the Premises that Tenant is prevented from using, and does not use, bears to the total rentable
area of the Premises. However, in the event that Tenant is prevented from conducting, and does not
conduct, its business in any portion of the Premises for a period of time in excess of the
Eligibility Period, and the remaining portion of the Premises is not sufficient to allow Tenant
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to effectively conduct its business therein, and if Tenant does not conduct its business from such
remaining portion, then for such time after expiration of the Eligibility Period during which
Tenant is so prevented from effectively conducting its business therein, the Rent for the entire
Premises shall be abated; provided, however, if Tenant reoccupies and conducts its business from
any portion of the Premises during such period, the Rent allocable to such reoccupied portion,
based on the proportion that the rentable area of such reoccupied portion of the Premises bears to
the total rentable area of the Premises, shall be payable by Tenant from the date such business
operations commence.
22.
SIGNS AND ADVERTISING. Landlord shall provide Tenant, at Landlord’s sole cost and
expense, with Building standard signage (as such standard is established from time to time by
Landlord) on the Building directory in the lobby of the Building and at the entry to the Premises
for Tenant. In addition, Tenant shall have the right to install, at Tenant’s sole cost and expense,
signage on or adjacent to the entry to the Premises, in the lobby and corridor of any floor in
which any part of the Premises are located and on the exterior monument sign for the Building in
the top tenant location (“Additional Tenant Signage”); provided, however, that Tenant must present
the desired signage to Landlord for its review and approval, which shall not be unreasonably
withheld. Any Additional Tenant Signage shall comply with Landlord’s signage program for the
Building; provided, however, that Tenant shall be permitted to use its standard font and logo in
connection with the Additional Tenant Signage. Tenant shall not erect or install or otherwise
utilize signs, lights, symbols, canopies, awnings, window coverings or other advertising or
decorative matter (collectively, “Signs”) on the windows, walls or exterior doors or otherwise
visible from the exterior of the Premises without first (a) submitting its plans to Landlord and
obtaining Landlord’s written approval thereof, which approval shall not be unreasonably withheld,
conditioned or delayed, and (b) obtaining any required approval of any applicable governmental
authority with jurisdiction at Tenant’s sole cost and expense. All Signs approved by Landlord
shall be professionally designed and constructed in a first-class workmanlike manner.
Subject to Tenant’s right to use its standard font and logo, Landlord shall have the right to
promulgate from time to time additional reasonable and non-discriminatory rules, regulations and
policies relating to the style and type of said advertising and decorative matter which may be used
by any occupant, including Tenant, in the Building, and may change or amend such rules and
regulations from time to time as in its discretion it deems advisable. Tenant agrees to abide by
such rules, regulations and policies. At the expiration or earlier termination of this Lease, all
such signs, lights, symbols, canopies, awnings or other advertising or decorative matter attached
to or painted by Tenant upon the Premises, whether on the exterior or interior thereof, shall be
removed by Tenant at its own expense, and Tenant shall repair any damage or injury to the Premises
or the Building, and correct any unsightly condition, caused by the maintenance and removal
thereof.
23. PARKING. Subject to the rules and regulations of the Town of Mill Valley and the
County of Marin, Tenant shall have the right to use, without payment of additional rent for such
parking (provided that nothing contained in this Section 23 shall be deemed to limit
Landlord’s right to include costs relating to the Project parking areas in Operating Expenses to
the extent permitted under the provisions of Section 4 above), four (4) parking spaces for
every 1,000 rentable square feet in the Premises in the parking facilities for the Project in
common with other tenants, guests and invitees of the Project during the Term of this Lease and
otherwise subject to the reasonable rules and regulations applicable to the parking facilities,
including, without
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limitation, hours of operation. The Project shall contain approximately four (4) parking spaces for
each 1,000 square feet of usable office space. Access to and from the parking facilities shall be
available twenty-four (24) hours per day, seven (7) days per week in accordance with the Landlord’s
reasonable and nondiscriminatory rules and regulations established therefore from time to time.
24. RULES AND REGULATIONS. Tenant agrees to observe and be bound by the Rules and
Regulations applicable to the Project, a copy of which is attached hereto as Exhibit E.
Landlord reserves the right to amend said Rules and Regulations in a reasonable and
nondiscriminatory manner, as Landlord in its reasonable judgment may from time to time deem to be
necessary or desirable for the safety, care and cleanliness of the Project and the preservation of
good order therein, and Tenant agrees to comply therewith provided that no amendments to the Rules
and Regulations shall interfere with Tenant’s use of the Premises. Landlord may make concessions
requested by a tenant without granting the same concessions to any other tenant. To the extent
the Rules and Regulations conflict with this Lease, this Lease shall control.
25. TIME. Time is of the essence of this Lease.
26. QUIET ENJOYMENT. Landlord covenants to control its activities and personnel such that
if and so long as no Event of Default by Tenant is in existence under this Lease, Tenant shall hold
and enjoy the Premises peaceably and quietly, subject to the provisions of this Lease.
27. DEFAULTS AND REMEDIES.
(a) Defaults. The occurrence of any one or more of the following events
shall constitute a default hereunder by Tenant (each an “Event of Default”):
(1) The failure by Tenant to make any payment of Basic Rent, additional rent, other charges or
any other payment required to be made by Tenant hereunder, as and when due, where such failure
shall continue for a period of ten (10) days after written notice thereof from Landlord to Tenant;
provided, however, that any such notice shall be in lieu of, and not in addition to, any notice
required under California Code of Civil Procedure § 1161 regarding unlawful detainer actions.
(2) The failure by Tenant to observe or perform any of the express or implied covenants or
provisions of this Lease to be observed or performed by Tenant, other than as specified in
Section 27(a) above, where such failure shall continue for a period of thirty (30) days
after written notice thereof from Landlord to Tenant. Any such notice shall be in lieu of, and not
in addition to, any notice required under California Code of Civil Procedure § 1161 regarding
unlawful detainer actions. If the nature of Tenant’s default (other than a default specified in
Section 27(a)(l) above) is such that more than thirty (30) days are reasonably required for
its cure, then Tenant shall not be deemed to be in default if Tenant shall promptly commence such
cure within said thirty (30) day period and thereafter diligently prosecute such cure to
completion.
(b) Remedies. If an Event of Default exists, in addition to any other remedies
available to Landlord at law or in equity, Landlord shall have the following rights and remedies:
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(1) The right to terminate the Lease and pursue its rights and remedies provided by California
Civil Code Section 1951 .2, in which event Landlord may recover
(A) The worth at the time of award of any unpaid rent which had been earned at
the time of such termination; plus
(B) The worth at the time of award of the amount by which the unpaid rent which
would have been earned after termination until the time of award exceeds the amount
of such rental loss that Tenant proves could have been reasonably avoided; plus
(C) The worth at the time of award of the amount by which the unpaid rent for
the balance of the Term after the time of award exceeds the amount of such rental
loss that Tenant proves could have been reasonably avoided; plus
(D) Any other amount necessary to compensate Landlord for all the detriment
proximately caused by Tenant’s failure to perform its obligations under this Lease
or which in the ordinary course of things would be likely to result therefrom,
specifically including, but not limited to, brokerage commissions and advertising
expenses incurred, expenses of remodeling the Premises or any portion thereof for a
new tenant, whether for the same or a different use, and any special
concessions made to obtain a new tenant; plus
(E) At Landlord’s election, such other amounts in addition to or in lieu of the
foregoing as may be permitted from time to time by applicable law so long as not
duplicative of other amounts paid or payable by Tenant.
The term “rent” as used hereinabove shall be deemed to be and to mean all sums of every
nature required to be paid by Tenant pursuant to the terms of this Lease, whether to Landlord or
to others. As used herein, the “worth at the time of award” for (A) and (B) above shall be
computed by allowing interest at the Interest Rate. As used herein, the “worth at the time of
award” for (C) above shall be computed by discounting such amount at the discount rate of the
Federal Reserve Bank of San Francisco at the time of award plus one percent (1%).
(2) The rights and remedies provided by California Civil Code Section 1951.4, that allow
Landlord to continue this Lease in effect and to enforce all of its rights and remedies under this
Lease, including the right to recover Basic Rent, additional rent and other charges as they become
due, for so long as Landlord does not terminate Tenant’s right to possession. Acts of
maintenance or preservation, efforts to re-let the Premises or the appointment of a receiver upon
Landlord’s initiative to protect its interest under this Lease shall not constitute a termination
of Tenant’s right to possession;
(3) The right to enter the Premises and remove therefrom all persons and property, store such
property in a public warehouse or elsewhere at the cost of and for the
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account of Tenant, and sell such property and apply the proceeds therefrom pursuant to applicable
California law; and
(4) The right to take steps necessary or appropriate to have a receiver appointed for Tenant
in order to take possession of the Premises and apply any rental collected and exercise all other
rights and remedies granted to Landlord.
(c) Re-entry. If an Event of Default exists, Landlord shall also have the right, with
or without terminating this Lease, to re-enter the Premises and remove all persons and property
from the Premises; such property may be removed and stored in a public warehouse or elsewhere at
the cost of and for the account of Tenant. No re-entry or taking possession of the Premises by
Landlord pursuant to this Section 27(c) shall be construed as an election to terminate this
Lease unless a written notice of such intention is given to Tenant or unless the termination
thereof is decreed by a court of competent jurisdiction.
(d) Remedies Cumulative; Waiver. All rights, options and remedies of Landlord
contained in this Lease or provided by law or in equity shall be construed and held to be
cumulative, and no one of them shall be exclusive of the other. No waiver of any default
hereunder shall be implied from any acceptance by Landlord of any Basic Rent, additional rent or
other charges due hereunder or any omission by Landlord to take any action on account of such
default, and no express waiver shall affect any default other than as specified in said waiver. The
consent or approval of Landlord to or of any act by Tenant requiring Landlord’s consent or approval
shall not be deemed to waive or render unnecessary Landlord’s consent or approval to or of any
subsequent similar acts by Tenant.
28. TRANSFER OF LANDLORD’S INTEREST. In the event of any transfer or transfers of
Landlord’s interest in the Project or the Building, other than a transfer for security purposes
only, and the assumption in writing by the transferee of the obligations of Landlord under this
Lease accruing with respect to the period from and after the date of such transfer, Tenant agrees
that Landlord shall be automatically relieved of any and all obligations and liabilities on the
part of Landlord accruing with respect to the period from and after the date of such transfer and
Tenant agrees to attorn to the transferee.
29. RIGHT TO PERFORM. If Tenant shall fail to pay any sum of money, other than Basic Rent
required to be paid by it hereunder, or shall fail to perform any other act on its part to be
performed hereunder, and such failure shall continue for thirty (30) days after written notice
thereof by Landlord (or such shorter period as may be reasonably appropriate in an emergency
situation of imminent risk of injury to persons or property damage), Landlord may, but shall not be
obligated so to do, and without waiving or releasing Tenant from any obligations of Tenant, make
any such payment or perform any such other act on Tenant’s part to be made or performed as provided
in this Lease. Tenant shall reimburse Landlord for all costs incurred in connection with such
payment or performance within thirty (30) days of demand.
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30. TENANT IMPROVEMENTS.
(a) Certain Definitions.
(1) Tenant Improvements. “Tenant Improvements” shall mean all
improvements, alterations and additions desired by Tenant to be made initially in and to the
Premises in excess of and addition to the Base Building Work.
(2) Tenant Improvement Allowance. “Tenant Improvement Allowance”
shall have the meaning set forth in Paragraph 19 of the Basic Lease Provisions and shall
be credited toward the cost of the Tenant Improvements and Construction Costs in accordance with
the provisions of this Section 30.
(3) Substantial Completion; Punch List Items. “Substantial Completion” shall mean, and
the Tenant Improvements shall be deemed to be “Substantially
Complete”, when all of the following
have occurred: (i) Tenant has completed the Tenant Improvements in accordance with the Final Plans
and all applicable Laws so that Tenant may occupy the Premises for their intended business purpose
and conduct Tenant’s normal business operations from the Premises, subject only to minor and
customary punch list items which so not materially interfere with Tenant’s occupancy thereof and
conduct of its normal business operations therein (Collectively “Punch List Items”); (ii) the
County of Marin has issued a certificate of occupancy (or is equivalent) for the Premises; and
(iii) Tenant is able to receive at the Premises all utilities and other building services to be
provided to Tenant by Landlord pursuant to the Lease.
(4) Construction
Costs. “Construction Costs” shall mean all costs incurred by Tenant
in the design and construction of its Tenant Improvements including costs for signage,
communication systems and cabling.
(5) Building Plans. “Building Plans” shall mean the Building plans and specifications
sufficient to allow Tenant’s Architect to complete a Space Plan and Working Drawings. Landlord
shall submit to Tenant the Building Plans prior to the execution of this Lease.
(6) Base Building Work. “Base Building Work” shall mean the work to be performed by
Landlord at its sole cost and expense (without deduction from the Tenant Improvement Allowance)
shown on Exhibit F.
(7) Delivery Condition. “Delivery Condition” shall mean (i) the Base Building
Work is substantially complete such that Tenant may construct its Tenant
Improvements without interference from Landlord and its contractors and (ii) the Building,
Premises, Building Structure and Building Systems are in first class condition and operating order,
free of hazardous materials and asbestos and in compliance with all laws applicable to new
construction, disregarding variances and grandfathered rights.
(8) Force Majeure Delay. “Force Majeure Delay” shall mean any delay incurred by Tenant
in the design and construction of its Tenant Improvements or its move into the Premises
attributable to any: (i) actual delay or failure to perform attributable to any strike,
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lockout or other labor or industrial disturbance (whether or not on the part of the employee of
either party hereto), civil disturbance, further order claiming jurisdiction, act of public enemy,
war, riot, sabotage, blockade, embargo; (ii) delay due to changes in any applicable laws
(including, without limitation, the ADA) or Building Plans, or the interpretation thereof; or (iii)
delay attributable to lightning, earthquake, fire, storm, hurricane, tornado, flood, washout,
explosion, or any other similar industry-wide or Building-wide cause beyond the reasonable control
of the party from whom performance is required, or any of its contractors or other representatives.
(9) Landlord Delay. “Landlord Delay” shall mean any delay incurred by Tenant in the
design and construction of its Tenant Improvements or its move into the Premises caused by (i)
Landlord’s failure to approve the Space Plan or Working Drawings or any revisions to either the
Space Plan or Working Drawings within the time periods specified in Section 30(c) below;
(ii) deficiencies in the Base Building Work or failure of the Base Building Work to substantially
comply with the Building Plans; (iii) any material breach by Landlord or any of the Landlord
Parties of any provision of this Lease; (iv) any other delay to the extent requested or caused by
Landlord or the Landlord Parties; delay in the giving of authorizations or approvals by Landlord;
(v) delay attributable to the acts or failures to act, whether willful, negligent or otherwise, of
Landlord, its agents or contractors; (vi) delay attributable to the interference of Landlord, its
agents or contractors with the design of the Tenant Improvements or the failure or refusal of any
such party to permit Tenant, its agents or contractors, access to and priority use of the Building
or any Building facilities or services, including freight elevators, passenger elevators, and
loading docks, which access and use are required for the orderly and continuous performance of the
work necessary for Tenant to complete its move in into the Premises during the Construction Period;
(vii) delay by Landlord in the substantial completion of the Base Building Work prior to the
commencement of the move into the Premises; (viii) delay attributable to Landlord’s failure to
allow Tenant sufficient access to the Building and/or the Premises to move into the Premises over
one (1) weekend; and (ix) delay caused by the failure of the base Building to comply with the ADA;
provided, however, that no such Landlord Delay shall be deemed to have occurred unless and until
the matter giving rise to such claimed Landlord Delay is not cured within one (1) business day
following Landlord’s receipt of written notice thereof (provided, however, that notwithstanding
anything to the contrary in this Lease as to the manner of giving notices, such notice shall be
given by facsimile to (000) 000-0000).
(10) Tenant’s Contractor. “Tenant’s Contractor” shall mean .
Tenant’s Contractor may also be another general contractor selected and retained by Tenant and
approved by Landlord to construct and install the Tenant Improvements within the Premises.
(11) Material Change Order. “Material Change Order” shall mean any change order or
modification which increases the Construction Costs by more than .
(12) Tenant’s Architect. “Tenant’s Architect”
shall be .
(b) Plans and Drawings. Tenant shall submit to Landlord Tenant’s proposed space plan
for the Premises (the “Space Plan”). Landlord shall approve or disapprove the Space Plan within
five (5) business days after delivery of the Space Plan to Landlord, which approval shall
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not be withheld unless a Design Problem (as defined in Section 8(a) ) exists or
conditioned. If Landlord reasonably disapproves the Space Plan because of a Design Problem,
Landlord shall return the Space Plan to Tenant with Landlord’s specific requested changes noted
thereon. Tenant shall revise and resubmit the Space Plan to Landlord and Landlord shall approve or
disapprove such revised Space Plan if a Design Problem exists within five (5) business days of
receipt. After Landlord’s approval of the Space Plan, Tenant shall deliver to Landlord for
Landlord’s approval working drawings consisting of a floor plan, reflected ceiling plan, interior
elevations and electrical plan (the “Working Drawings”), which Working Drawings shall be consistent
with the Space Plan. Landlord shall approve or disapprove the Working Drawings within five (5)
business days after delivery of the Working Drawings to Landlord, which approval shall not be
withheld unless a Design Problem exists or conditioned. If Landlord disapproves the Working
Drawings, Landlord shall return the Working Drawings to Tenant with Landlord’s specific requested
changes noted thereon. Tenant shall revise and resubmit the Working Drawings to Landlord and
Landlord shall approve or disapprove such revised Working Drawings if a Design Problem exists
within five (5) business days after receipt. The Working Drawings as finally approved by Landlord
are referred to as the “Final Plans.” The Space Plan and Working Drawings may be submitted by
Tenant in one or more stages and at one or more times, and the time periods for Landlord’s approval
shall apply with respect to each such portion submitted. Tenant shall obtain all permits and
approvals necessary for all of the Tenant Improvements and construct and install all Tenant
Improvements within the Premises using Tenant’s Contractor in accordance with all applicable Laws
and the Final Plans, in a first-class and workmanlike manner. In the event Tenant needs to make
changes to the Final Plans, Tenant shall submit all Material Change Orders to Landlord for
Landlord’s approval, which approval shall be given or denied (and if denied, only if a Design
Problem exists and specifying the reasons for denial) within three (3) to five (5) business days
following Landlord’s receipt of any Material Change Order; provided, however, that Landlord agrees
to use commercially reasonable efforts to respond to a request for a Material Change Order within
three (3) business days. Any Construction Costs which are paid or incurred by Tenant by reason of
deficiencies in the Base Building Work shall be paid solely by Landlord and shall not be charged
against the Tenant Improvement Allowance or otherwise be paid by Tenant.
(c) Payment of Tenant Improvement Allowance. The Tenant Improvement Allowance shall
be disbursed to Tenant by Landlord within twenty (20) days of receipt of Tenant’s request
accompanied by paid invoices and lien free endorsements executed by the appropriate payee.
Landlord’s sole obligation to reimburse for Tenant Improvements shall not exceed that amount set
forth in the Paragraph 19 of the Basic Lease Information. If any installment is not paid
when due, the same shall bear interest at the Interest Rate from the due date until the payment
date, and Tenant shall have the right to setoff the amount of such installments and such interest
against the rent due under the Lease. Landlord acknowledges that Tenant will be occupying the
Premises prior to the Commencement Date pursuant to a Sublease Agreement with MarketTools, Inc.
(the “Sublease”), which Sublease has been approved by Landlord. Notwithstanding any provision of
this Lease to the contrary, but subject to the terms and conditions of this Section 30, Tenant
shall be permitted to construct some or all of the Tenant Improvements to the Premises during the
term of the Sublease, and Landlord agrees to make the Tenant Improvement Allowance available
during such time period for such purposes. Landlord further agrees that (i) Tenant may use a
portion of the Tenant Improvement Allowance to construct an interior staircase connecting the
Premises with the premises leased by Tenant on
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the third floor of the Building, and (ii) subject to Landlord’s approval as to the location,
capacity and means of installing the same, Tenant may install, at its cost, an emergency back-up
generator at a location mutually acceptable to Landlord and Tenant in compliance with all
applicable governmental regulations. The generator shall support all Building Systems, including
electrical, plumbing, heating, ventilating, sprinkler and life-safety equipment, serving the
Building, including the Premises and any common areas of the Building. Landlord will cooperate
with Tenant in obtaining any permits or other governmental approvals required by the City of Mill
Valley to install and operate the emergency
back-up generator.
back-up generator.
(d) Miscellaneous Charges. Neither Tenant nor Tenant’s Contractor shall be charged
for, and Landlord shall provide, parking (to the extent parking is available) for Tenant’s
Architect, designers, contractors and subcontractors (including those people working on the Tenant
Improvements), electricity, water, toilet facilities, HVAC, security and elevators during the
design and construction of the Tenant Improvements and the move into the Premises. All such
equipment, areas, elevators and utilities shall be made reasonably available to Tenant during the
design and construction of the Tenant Improvements and the move into the Premises. The HVAC systems
for the Premises shall be run continuously twenty-four (24) hours per day, seven (7) days per week
during the move into the Premises to flush out and purge new finish odors.
(e) Use of Conduits, Risers and Raceways. Landlord shall make available to Tenant for
the initial Tenant Improvements and any later Alterations non-exclusive use of all existing
conduit, risers and vertical and horizontal raceways in the Building for
Tenant’s telecommunications and cabling requirements between the Premises and the roof of the
Building,
(f) Codes/Hazardous Materials. If Tenant cannot obtain or is delayed in obtaining
any permit required for construction of its Tenant Improvements or occupancy of the Premises
because the Building and/or the Premises (x) are not in full compliance with all applicable laws
and/or (y) contains Hazardous Materials and/or asbestos, then Landlord shall pay for or reimburse
Tenant for all increased costs paid or incurred by Tenant on account thereof in addition to the
Tenant Improvement Allowance and any delay in the completion of Tenant’s improvements shall be
deemed a Landlord Delay. Further, Landlord shall, at its sole cost and expense, immediately
correct any deficiencies as to legal compliance and the presence of Hazardous Materials and
asbestos.
(g) Fee to Landlord. Landlord’s management fee is three percent (3%).
31. NOTICES. All notices under this Lease shall be in writing and sent to the parties at
the following addresses or at such other address as any party hereto may designate to the other by
notice delivered as provided herein:
To Landlord:
|
Bently Holdings CA LP | |
| 000 Xxxxxxxx Xxxxxx, 0xx Xxxxx | ||
| Xxx Xxxxxxxxx, Xxxxxxxxxx 00000 | ||
| Telephone No.: (000) 000-0000 | ||
| Facsimile No.: (000) 000-0000 |
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To Tenant:
|
Redwood Trust, Inc. | |
| Xxx Xxxxxxxxx Xxxxx, Xxxxx 000 | ||
| Xxxx Xxxxxx, XX 00000 |
Any such notices shall be sent by (i) U.S. certified mail, postage prepaid, return receipt
requested, in which case notice shall be deemed delivered three business days after timely deposit
in the mail, (ii) a nationally recognized overnight courier, in which case notice shall be deemed
delivered one business day after timely deposit with such courier; (iii) personally delivered, in
which case notice shall be deemed delivered upon receipt or refusal of receipt, or (iv) electronic
communication, whether by telex, telegram or telecopying, in which case notice shall be deemed
delivered on the date of confirmed dispatch provided such electronic communication is followed up
with a notice sent by mail.
32. ATTORNEYS’ FEES. If either party places the enforcement of this Lease or any part
hereof, or the collection of any Basic Rent, additional rent or other charges due or to become due
hereunder, or recovery of the possession of the Premises, in the hands of an attorney, or files
suit or brings an arbitration upon the same, the non-prevailing (or defaulting) party shall pay the
other party’s reasonable legal and attorneys’ fees, costs and expenses, including legal and
attorneys’ fees, costs and expenses incurred in connection with any appeals and any bankruptcy or
insolvency proceedings involving Tenant or this Lease. If Landlord is named as a defendant in any
suit brought against Tenant in connection with or arising out of Tenant’s occupancy hereunder,
Tenant shall pay to Landlord its reasonable costs and expenses in such suit, including its
reasonable attorneys’ fees. Any such attorneys’ fees and other expenses incurred by either party
in enforcing a judgment in its favor under this Lease shall be recoverable separately from and in
addition to any other amount included in such judgment, and such attorneys’ fees obligation is
intended to be severable from the other provisions of this Lease and to survive and not be merged
into any such judgment. The terms “attorneys’ fees” and “attorneys’ fees, costs and expenses”
shall mean the fees, costs and expenses of counsel to the parties hereto, which may include
printing, photostating, duplicating and other expenses, air freight charges, and fees billed for
law clerks, paralegals and other persons not admitted to the bar but performing services under the
supervision of an attorney, and the costs and fees incurred in connection with the enforcement or
collection of any judgment obtained in any such proceeding, and shall include, specifically, all
fees, costs and expenses of-expert witnesses. For purposes of this Section 32, the term
“prevailing party” shall include a prevailing party as defined in California Code of Civil
Procedure Section 998.
33. HOLDING OVER. If Tenant holds over after the expiration or earlier termination of the
Term without the express prior written consent of Landlord, Tenant shall become a tenant from month
to month only, at a rental rate equal to one hundred twenty-five percent (125%) of the Basic Rent,
additional rent and other charges in effect upon the date of such expiration (subject to adjustment
as provided in Section 4 hereof and prorated on a daily basis), and otherwise subject to
the terms, covenants and conditions herein specified, so far as applicable; provided, however, that
such percentage shall increase from one hundred twenty-five percent (125%) to one hundred fifty
percent (150%) following the first ninety (90) days of any such holding over. Acceptance by
Landlord of rent after such expiration or earlier termination shall not result in a renewal of this
Lease and shall not waive Landlord’s right to bring an unlawful detainer action against Tenant or
otherwise remove Tenant from the Premises. If Tenant fails to
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surrender the Premises upon the expiration of this Lease despite demand to do so by Landlord,
Tenant shall indemnify, defend and hold Landlord harmless from all loss or liability, including
without limitation, any claim made by any succeeding tenant founded on or resulting from such
failure to surrender.
34. SURRENDER OF PREMISES. Subject to Section 18(i), the voluntary or other
surrender of this Lease by Tenant, or a mutual cancellation hereof, shall not work a merger, and
shall, at the option of Landlord, operate as an assignment to it of any subleases or subtenancies.
35. NON-WAIVER. Neither the acceptance of rent nor any other act or omission of Landlord
or Tenant at any time or times after the happening of any event authorizing the cancellation or
forfeiture of this Lease shall operate as a waiver of any past or future violation, breach or
failure to keep or perform any covenant, agreement, term or condition hereof, or deprive the other
party of its rights and remedies under this Lease, or be construed so as to at any future time stop
Landlord or Tenant from promptly exercising any other option, right or remedy that it may have
under any term or provision of this Lease.
36. MORTGAGE PROTECTION. In the event of any default on the part of Landlord, Tenant will
give written notice by registered or certified mail to any beneficiary of a deed of trust or
mortgagee under a mortgage covering the Project or the Building whose address shall have been
furnished to Tenant, and shall offer such beneficiary or mortgagee a reasonable opportunity to cure
the default (if such beneficiary or mortgagee is acting in good faith to cure the Landlord’s
default (if curable)), including time to obtain possession of the Project or the Building by power
of sale or a judicial foreclosure, if such should prove necessary to effect a cure. For purposes
hereof, a reasonable opportunity shall mean thirty (30) days after receipt of Tenant’s notice or
such longer period as may be necessary so long as the cure is commenced within said thirty (30) day
period and is being diligently pursued to completion.
37. EXPEDITED DISPUTE RESOLUTION. With the exception of the arbitration provisions
which shall specifically apply to the determination of the Fair Market Rental Value and Landlord’s
exercise of unlawful detainer remedies, the provisions of this Section 37 contain the sole
and exclusive method, means and procedure to resolve any and all disputes or disagreements,
including whether any particular matter constitutes, or with the passage of time would constitute,
an Event of Default. The parties hereby irrevocably waive any and all rights to the contrary and
shall at all times conduct themselves in strict, full, complete and timely accordance with the
provisions of this Section 37. Any and all attempts to circumvent the provisions of this
Section 37 shall be absolutely null and void and of no force or effect whatsoever. As to
any matter submitted to arbitration to determine whether it would, with the passage of time,
constitute an Event of Default, such passage of time shall not commence to run until any such
affirmative determination, so long as it is simultaneously determined that the challenge of such
matter as a potential Event of Default was made in good faith, except with respect to the payment
of money. With respect to the payment of money, such passage of time shall not commence to run
only if the party which is obligated to make the payment does in fact make the payment to the other
party. Such payment can be made “under protest,” which shall occur when such payment is
accompanied by a good faith notice stating why the party has elected to make a payment under
protest. Such protest will be deemed waived unless the subject matter identified in the protest is
submitted to arbitration as set forth in the following:
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(a) Arbitration Panel. Within ten (10) days after delivery of written notice (“Notice
of Dispute”) of the existence and nature of any dispute given by any party to the other party, and
unless otherwise provided herein in any specific instance, the parties shall each: (i) appoint one
(1) lawyer actively engaged in the licensed and full time practice of law, specializing in real
estate, in the County of Marin for a continuous period immediately preceding the date of delivery
(“Dispute Date”) of the Notice of Dispute of not less than ten (10) years, but who has at no time
ever represented or acted on behalf of any of the parties, and (ii) deliver written notice of the
identity of such lawyer and a copy of his or her written acceptance of such appointment and
acknowledgment of and agreement to be bound by the time constraints and other provisions of this
Section 37 (“Acceptance”) to the other parties hereto. The party who selects the lawyer
may not consult with such lawyer, directly or indirectly, to determine the lawyer’s position on the
issue which is the subject of the dispute. In the event that any party fails to so act, such
arbitrator shall be appointed pursuant to the same procedure that is followed when agreement cannot
be reached as to the third arbitrator. Within ten (10) days after such appointment and notice,
such lawyers shall appoint a third lawyer (together with the first two (2) lawyers, “Arbitration
Panel”) of the same qualification and background and shall deliver written notice of the identity
of such lawyer and a copy of his or her written Acceptance of such appointment to each of the
parties. In the event that agreement cannot be reached on the appointment of a third lawyer within
such period, such appointment and notification shall be made as quickly as possible by any court
of competent jurisdiction, by any licensing authority, agency or organization having
jurisdiction over such lawyers, by any professional association of lawyers in existence for not
less than ten (10) years at the time of such dispute or disagreement and the geographical
membership boundaries of which extend to the County of Marin or by any arbitration association or
organization in existence for not less than ten (10) years at the time of such dispute or
disagreement and the geographical boundaries of which extend to the County of Marin, as determined
by the party giving such Notice of Dispute and simultaneously confirmed in writing delivered by
such party to the other party. Any such court, authority, agency, association or organization
shall be entitled either to directly select such third lawyer or to designate in writing, delivered
to each of the parties, an individual who shall do so. In the event of any subsequent vacancies or
inabilities to perform among the Arbitration Panel, the lawyer or lawyers involved shall be
replaced in accordance with the provisions of this Section 37 as if such replacement was an
initial appointment to be made under this Section 37 within the time constraints set forth
in this Section 37, measured from the date of notice of such vacancy or inability, to the
person or persons required to make such appointment, with all the attendant consequences of failure
to act timely if such appointed person is a party hereto.
(b) Duty. Consistent with the provisions of this Section 37, the members of
the Arbitration Panel shall utilize their utmost skill and shall apply themselves diligently so as
to hear and decide, by majority vote, the outcome and resolution of any dispute or disagreement
submitted to the Arbitration Panel as promptly as possible, but in any event on or before the
expiration of thirty (30) days after the appointment of the members of the Arbitration Panel. None
of the members of the Arbitration Panel shall have any liability whatsoever for any acts or
omissions performed or omitted in good faith pursuant to the provisions of this Section 37.
(c) Authority. The Arbitration Panel shall (i) enforce and interpret the rights and
obligations set forth in the Lease to the extent not prohibited by law, (ii) fix and establish any
and all rules as it shall consider appropriate in its sole and absolute discretion to govern the
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proceedings before it, including any and all rules of discovery, procedure and/or evidence, and
(iii) make and issue any and all orders, final or otherwise, and any and all awards, as a court of
competent jurisdiction sitting at law or in equity could make and issue, and as it shall consider
appropriate in its sole and absolute discretion, including the awarding of monetary damages (but
shall not award consequential damages to either party and shall not award punitive damages except
in situations involving knowing fraud or egregious conduct condoned by, or performed by, the person
who, in essence, occupies the position which is the equivalent of the chief executive officer of
the party against whom damages are to be awarded), the awarding of reasonable attorneys’ fees and
costs to the prevailing party as determined by the Arbitration Panel and the issuance of injunctive
relief. If the party against whom the award is issued complies with the award, within the time
period established by the Arbitration Panel, then no Event of Default will be deemed to have
occurred, unless the Event of Default pertained to the non payment of money by Tenant or Landlord,
and Tenant or Landlord failed to make such payment under protest.
(d) Appeal. The decision of the Arbitration Panel shall be final and binding, may be
confirmed and entered by any court of competent jurisdiction at the request of any party and may
not be appealed to any court of competent jurisdiction or otherwise except upon a claim of fraud
on the part of the Arbitration Panel, or on the basis of a mistake as to the applicable law. The
Arbitration Panel shall retain jurisdiction over any dispute until its award has been implemented,
and judgment on any such award may be entered in any court having appropriate jurisdiction.
38. CHANGES TO THE PROJECT. Landlord reserves the right at any time to make changes,
alterations, reductions and additions to the Project, including the construction of other buildings
or improvements in the Project, the leasing of space to restaurant uses, the building of additional
stories on any building, without any liability or responsibility to Tenant. Landlord will not
block ingress and egress to the Premises. No rights to any view or to light or air over any
property, whether belonging to Landlord or any other person, are granted to Tenant by this Lease.
If at any time any windows of the Premises are temporarily darkened or the light or view therefrom
is obstructed by reason of any repairs, improvements, maintenance or cleaning in or about the
Project, the same shall be without liability to the Landlord and without any reduction or
diminution of Tenant’s obligations under this Lease. Notwithstanding the foregoing, Landlord agrees
that it shall not make or permit any permanent modification to the Building (as built substantially
in accordance with the Building Plans), on any changes, alterations, reductions and additions to
the Project, which change the nature of the Building to something other than a first class office
building, materially obstructs the natural light to the Premises or which materially adversely
affects (a) use or occupancy of the Premises, (b) parking serving the Building, or (c) ingress,
egress or access to or from the Building and the Premises.
39. WAIVER OF JURY TRIAL. EACH PARTY HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY
ACTION TO ENFORCE THE SPECIFIC PERFORMANCE OF THIS LEASE, FOR DAMAGES FOR THE BREACH HEREOF, OR
OTHERWISE FOR ENFORCEMENT OF ANY REMEDY HEREUNDER. If either party commences litigation against
the other for the specific performance of this Lease, for damages for the breach hereof or
otherwise for enforcement of any remedy hereunder, the prevailing party shall be entitled to
recover from the other party such costs and reasonable attorneys’ fees as may have been
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incurred, including any and all costs incurred in enforcing, perfecting and executing such
judgment.
40. OPTIONS TO EXTEND THE TERM.
(a) Extension Terms.
(1) First Extension Term. Landlord grants to Tenant an option to extend the Initial
Term (the “First Extension Option”) with respect to all (but not less than all) of the rentable
area of the Premises leased by Tenant as of the Expiration Date of the Initial Term for five (5)
years (the “First Extension Term”). The First Extension Term shall commence immediately
following the Expiration Date of the Initial Term. The First Extension Option shall be exercised,
if at all, by written notice to Landlord at any time during the Initial Term on or before the date
that is one hundred eighty (180) days prior to the Expiration Date, which notice shall be
irrevocable by Tenant. Notwithstanding the foregoing, if an Event of Default (following the
expiration of all applicable cure period without cure) exists under this Lease either at the time
Tenant exercises the First Extension Option or at any time thereafter prior to on upon the
commencement of the First Extension Term, Landlord shall have, in addition to all of Landlord’s
other rights and remedies under this Lease, the right to terminate the First Extension Option and
to cancel unilaterally Tenant’s exercise of the First Extension Option, in which event the
Expiration Date of this Lease shall be and remain the then scheduled Expiration Date, and Tenant
shall have no further rights under this Lease to renew or extend the Term.
(2) Second Extension Term. Landlord grants to Tenant an option to extend Term of
this Lease (the “Second Extension Option”) with respect to all (but not less than all) of the
rentable area of the Premises leased by Tenant as of the Expiration Date of the First Extension
Term for five (5) years (the “Second Extension Term”). The Second Extension Term shall commence
immediately following the Expiration Date of the First Extension Term. The Second Extension Option
shall be exercised, if at all, by written notice to Landlord at any time during the First Extension
Term on or before the date that is one hundred eighty (180) days prior to the Expiration Date of
the First Extension Term, which notice shall be irrevocable by Tenant. Notwithstanding the
foregoing, if an Event of Default (following the expiration of all applicable cure period without
cure) exists under this Lease either at the time Tenant exercises the Second Extension Option or at
any time thereafter prior to or upon the commencement of the Second Extension Term, Landlord shall
have, in addition to all of Landlord’s other rights and remedies under this Lease, the right to
terminate the Second Extension Option and to cancel unilaterally Tenant’s exercise of the Second
Extension Option, in which event the Expiration Date of this Lease shall be and remain the then
scheduled Expiration Date of the First Extension Term, and Tenant shall have no further rights
under this Lease to renew or extend the Term.
(b) Extension Term Rent.
(1) The First Extension Term and Second Extension Term (each an “Extension Term”) shall be
upon and subject to all of the terms, covenants and conditions of this Lease; provided, however,
that Basic Rent for each Extension Term shall be equal to ninety-five percent (95%) of the Fair
Market Rental Value and the Base Year for each Extension Term shall be the calendar year in which
such Extension Term commences unless the Extension Term
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commences on or after October 1 of such calendar year, in which event the Base Year shall be the
calendar year following the calendar year in which the Extension Term commences. Such Basic Rent
shall be determined by Landlord in good faith not later than four (4) months prior to the
commencement of the applicable Extension Term. Tenant shall send to Landlord a written notice,
within thirty (30) days after the date of Landlord’s notice setting forth the Fair Market Rental
Value for the Extension Term, which notice shall state that Tenant either (x) agrees with
Landlord’s determination of Fair Market Rental Value for the Extension Term or (y) disagrees with
Landlord’s determination of Fair Market Rental Value for the Extension Term and elects to resolve
the disagreement as provided in Section 40(b)(2) below. If Tenant does not send to Landlord
a notice as provided in the previous sentence within the said thirty (30) day period, Tenant will
be deemed to have elected (y) above and the Fair Market Rental Value shall be resolved in
accordance with Section 40(b)(2) below. Until the disagreement is resolved as provided in
Section 40(b)(2) below, Tenant’s monthly payments of Basic Rent during the then applicable
Extended Term shall be in an amount not less than the greater of (x) Tenant’s determination of the
Fair Market Rental Value and (y) the Basic Rent payable for the twelve (12) month period
immediately preceding the commencement of the Extension Term. Within ten (10) business days
following the resolution of such dispute by the parties or the decision of the brokers, one party
shall make any necessary payment to the other party in order to adjust the amount previously paid
by Tenant during the Extension Term to the Fair Market Rental Value as determined. Tenant shall in
any event pay all applicable additional charges with respect to the Premises, in the manner and at
the times provided in this Lease, effective upon the commencement of the Extension Term, and
notwithstanding any dispute regarding the Basic Rent for the Extension Term.
(2) Any disagreement regarding the Fair Market Rental Value as defined in this
Section 40 shall be resolved as follows:
(i) Within twenty (20) days after Tenant’s response to Landlord’s notice of the Landlord’s
initial determination of the Fair Market Rental Value, Landlord and Tenant shall meet no less than
two (2) times, at a mutually agreeable time and place, to attempt to resolve any such
disagreement.
(ii) If, within the twenty (20) day consultation period described in subsection (i) above,
Landlord and Tenant cannot reach an agreement as to the Fair Market Rental Value, they shall each
make a separate determination of the Fair Market Rental Value within five (5) business days after
the expiration of the said twenty (20) day period, and such determinations shall be submitted to
arbitration in accordance with subsection (iii) below; provided that, if only one (1)
determination of Fair Market Rental Value is submitted to arbitration within the said five (5)
business day period, then such determination shall equal the Basic Rent for the Extension Term and
the parties shall not proceed with arbitration.
(iii) If the Basic Rent has not been determined pursuant to the procedures outlined above,
Landlord and Tenant shall each appoint one arbitrator who is unaffiliated with Landlord or Tenant
and who shall be a real estate broker and shall have been active over the five (5) year period
ending on the date of such appointment in the leasing of commercial mid-rise and/or high-rise
properties in the greater San Francisco metropolitan area. Each such arbitrator shall be appointed
within five (5) business days after the expiration of the
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twenty (20) day period described in subsection (ii) above. The two (2) arbitrators so appointed
shall within ten (10) days of the date of appointment of the last appointed arbitrator agree upon
and appoint a third arbitrator who shall be qualified under the same criteria set forth hereinabove
for qualification of the first two (2) arbitrators. The determination of the arbitrators shall be
limited solely to the issue of whether the Landlord’s or the Tenant’s submitted Fair Market Rental
Value (using the criteria for determining Fair Market Rental Value set forth in Paragraph
15 of the Basic Lease Provisions) is the closest to the actual Fair Market Rental Value of the
Premises, as determined by the arbitrators. The three (3) arbitrators shall within thirty (30) days
of the appointment of the third arbitrator reach a decision as to whether the parties shall use the
Landlord’s or the Tenant’s submitted Fair Market Rental Value as the Basic Rent for the Extension
Term, and shall notify Landlord and Tenant thereof. The decision of the majority of the three (3)
arbitrators shall be binding upon Landlord and Tenant. If either Landlord or Tenant fails to
appoint an arbitrator within the five (5) business day period provided above, then the arbitrator
appointed by one of them shall reach a decision, notify Landlord and Tenant thereof, and such
arbitrator’s decision shall be binding upon Landlord and Tenant. If the two (2) arbitrators fail to
agree upon and appoint a third arbitrator within the ten (10) day period provided above, or both
parties fail to appoint an arbitrator within the five (5) business day period provided above, then
the Landlord shall prepare and submit to Tenant a list of three (3) proposed arbitrators that
possess the required qualifications as set forth above; provided that none of such proposed
arbitrators nor the firm for which any of them works shall be a current or past affiliate of either
the Landlord or the Tenant or currently retained or employed by the Landlord or the Tenant. Within
five (5) business days after receipt of such list, the Tenant shall select an arbitrator therefrom
and such person shall be the third or single, as the case may be, arbitrator hereunder. If Tenant
fails to make such selection with such five (5) business day period, then the Landlord shall select
the third or single, as the case may be, arbitrator from such list. Each party shall pay the cost
of the arbitrator which it first selects and the parties shall share equally the cost of the third
arbitrator.
41. GENERAL PROVISIONS.
(a) Entire Agreement. This Lease contains all of the agreements of the
parties, and there are no verbal or other agreements which modify or affect this Lease. This
Lease supersedes any and all prior agreements made or executed by or on behalf of the parties
hereto regarding the Premises.
(b)
Terms and Headings. The words “Landlord” and
“Tenant” include the plural as well
as the singular, and words used in any gender include all genders. The titles to 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.
(c) Successors and Assigns. All of the covenants, agreements, terms and conditions
contained in this Lease shall inure to and be binding upon Landlord and Tenant and their respective
permitted successors in interest and assigns.
(d) Brokers. Each of Landlord and Tenant represents and warrants to the other party
that it has not engaged any broker, finder or other person who would be entitled to any commission
or fees in respect of the negotiation, execution or delivery of this Lease other than
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Landlord’s Broker and Tenant’s Broker (as defined in Paragraphs 22 and 23, respectively,
of the Basic Lease Information) (collectively, the “Brokers”) and shall indemnify, defend and hold
harmless the other party from and against any claim, demand, damage, loss, cost, liability or
expense incurred by such other party as a result of any claim asserted by any other broker, finder
or other person other than Brokers on the basis of any arrangements or agreements made or alleged
to have been made by or on behalf of such representing party, respectively.
(e) Liability of Landlord. Landlord’s obligations and liability to Tenant under this
Lease shall be limited solely to Landlord’s interest in the Project, all post-judgment rents,
issues and profits arising therefrom and the proceeds from the sale thereof, and any available
insurance proceeds and neither Landlord nor any of the members in Landlord, nor any officer,
director, shareholder or partner of or in Landlord or any members in Landlord shall have or incur
any personal liability whatsoever with respect to this Lease.
(f) Independent Covenants. Subject to the provisions of Section 7(a) above,
this Lease shall be construed as though the covenants herein between Landlord and Tenant are
independent and not dependent and Tenant agrees that if Landlord fails to perform its obligations
set forth herein, Tenant shall not be entitled to make any repairs or perform any acts hereunder at
Landlord’s expense or to any setoff of amounts owing hereunder against Landlord except as otherwise
provided in this Lease; provided, however, that the foregoing shall in no way impair the right of
Tenant to commence a separate action against Landlord for any violation by Landlord of the
provisions hereof so long as notice is first given to Landlord and any holder of a mortgage or deed
of trust covering the Building or the Project or any portion thereof, and an opportunity is granted
to Landlord and such mortgage holder to correct such violations as provided above.
(g) Waiver of Redemption by Tenant. Tenant hereby waives, for Tenant and for all
those claiming under Tenant, any and all rights now or hereafter existing to redeem by order or
judgment of any court or by any legal process or writ, Tenant’s right of occupancy of the Premises
after any termination of this Lease.
(h) 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 the
remaining provisions hereof shall nevertheless remain in full force and effect.
(i) Force Majeure. Except as may be otherwise specifically provided herein, time
periods for Landlord’s or Tenant’s performance under any provisions of this Lease not involving
the payment of money shall be extended for periods of time during which the non-performing party’s
performance is prevented due to circumstances beyond the party’s control, including, without
limitation, strikes, embargoes, governmental regulations, acts of God, weather, war or other
strife. Tenant hereby waives and releases its right to terminate this Lease under Section 1932(1)
of the California Civil Code or under any similar law, statute or ordinance now or hereafter in
effect.
(j) Intentionally Omitted.
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(k) Examination of Lease. Submission of this instrument for examination or signature
by Tenant does not constitute a reservation of or option to lease, and it is not effective as a
lease or otherwise until execution by and delivery to both Landlord and Tenant.
(1) No Warranty. In executing and delivering this Lease, Tenant has not relied on any
representations, including, but not limited to, any representation as to the amount of any item
comprising additional rent or the amount of the additional rent in the aggregate or that Landlord
is furnishing the same services to other tenants, at all, on the same level or on the same basis,
or any warranty or any statement of Landlord which is not set forth herein or in one or more of
the exhibits attached hereto.
(m) Right to Lease. Landlord reserves the absolute right to effect such other
tenancies in the Project as Landlord in the exercise of its sole business judgment shall determine
to best promote the interests of the Building and the Belvedere Place office center so long as the
Building remains a first-class office building comparable to Comparable Buildings. Tenant does not
rely on the fact, nor does Landlord represent, that any specific tenant or type or number of
tenants shall, during the Term, occupy any space in the Building or the Belvedere Place office
center.
(n) Transportation Management. Tenant shall exercise commercially reasonable efforts
to comply with all present or future programs intended to manage parking, transportation or
traffic in and around the Project, and in connection therewith, Tenant shall take reasonable and
responsible action for the transportation planning and management of all employees located at the
Project by working directly with Landlord, any governmental transportation management organization
or any other transportation-related committees or entities. Such programs may include, without
limitation (i) restrictions on the number of peak-hour vehicle trips generated by Tenant; (ii)
increased vehicle occupancy; (iii) implementation of an in-house ridesharing program and an
employee transportation coordinator; (iv) working with employees and any Project, Building or
area-wide ridesharing program manager; and (v) utilizing flexible work shifts for employees.
(o) Modification for Lender. If, in connection with Landlord’s obtaining
construction, interim or permanent financing for the Building or Project, the lender shall request
reasonable modifications in this Lease as a condition to such financing, Tenant will not
unreasonably withhold, delay or defer its consent thereto, provided that such modifications do not
increase the obligations of Tenant hereunder, decrease Tenant’s rights or adversely affect the
leasehold interest hereby created or Tenant’s rights hereunder.
(p) Requirements of Law. Landlord shall comply with all laws, rules and regulations
(including, without limitation, the Americans with Disabilities Act) applicable to the common
areas of the Building, other than such laws, rules and regulations with which Tenant is obligated
to comply under the terms of this Lease.
(q) Recording. Neither Landlord nor Tenant shall record this Lease nor a short form
memorandum hereof without the consent of the other, which consent shall not be unreasonably
withheld.
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(r) Applicable Laws. This Lease shall be governed by and construed pursuant to the
laws of the State of California.
(s) Relationship of Parties. Nothing contained in this Lease shall be deemed or
construed by the parties hereto or by any third party to create the relationship of principal and
agent, partnership, joint venture or any association between Landlord and Tenant, it being
expressly understood and agreed that neither the method of computation of rent nor any act or
omission of the parties hereto shall be deemed to create any relationship between Landlord and
Tenant other than the relationship of landlord and tenant.
(t) Landlord’s Title. Landlord’s title is and always shall be paramount to the title
of Tenant. Nothing herein contained shall empower Tenant to do any act which can, shall or may
encumber the title of Landlord.
(u) Project or Building Name and Storage. Landlord shall have the right at any time
to change the name of the Building or Project and to install, affix and maintain any and all signs
on the exterior and on the interior of the Project or Building as Landlord may, in Landlord’s sole
discretion, desire. Tenant shall not use the name of the Project or the Building (including the
name Belvedere Place) or use pictures or illustrations of the Project or the Building in
advertising or other publicity, without the prior written consent of the Landlord (which consent
shall not be unreasonably withheld).
(v) Survival of Obligations. All provisions of this Lease which require the payment
of money or the delivery of property after the termination of this Lease or require either party
to indemnify, defend or hold the other harmless shall survive the termination of this Lease.
(w) Authority. Each individual executing this Lease represents that it has all
requisite power and authority to execute and deliver this Lease on behalf of the entity for which
it is signing, and by his or her signature, will bind such party to the terms of this Lease.
(x) Execution in Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall constitute one and
the same agreement.
(y) Consent/Duty to Act Reasonably. Any time the consent of Landlord or Tenant is
required, such consent shall not be unreasonably withheld, conditioned or delayed. Whenever this
Lease grants Landlord or Tenant the right to take action, exercise discretion, establish rules and
regulations or make allocations or other determinations (other than decisions to exercise
expansion, contraction, cancellation, termination or renewal options), Landlord and Tenant shall
act reasonably and in good faith and take no action which might result in the frustration of the
reasonable expectations of a sophisticated tenant or landlord concerning the benefits to be
enjoyed under this Lease.
(z) Landlord Bankruptcy Proceeding. In the event that the obligations of Landlord
under this Lease are not performed during the pendency of a bankruptcy or insolvency proceeding
involving the Landlord as the debtor, or following the rejection of this Lease in accordance with
Section 365 of the United States Bankruptcy Code, then notwithstanding any
-45-
provision of this Lease to the contrary, and in addition to any and all other remedies permitted by
this Lease and/or by applicable laws Tenant shall have the right to set off against Rents next due
and owing under this Lease (a) any and all damages caused by such non-performance of Landlord’s
obligations under this Lease by Landlord, debtor-in-possession, or the bankruptcy trustee, and (b)
any and all damages caused by the non-performance of Landlord’s obligations under this Lease
following any rejection of this Lease in accordance with Section 365 of the United States
Bankruptcy Code.
(aa) Access. Tenant shall be granted access to the Building, the Premises and the
parking provided to the Building twenty-four (24) hours per day, seven (7) days per week, every
day of the year.
(bb) Prohibited Persons and Transactions. Tenant and Landlord (each, a “Representing
Party”) each represents and warrants to the other (i) that neither the Representing Party nor any
person or entity that directly owns a 10% or greater equity interest in it nor any of its
officers, directors or managing members is a person or entity (each, a “Prohibited Person”) with
whom U.S. persons or entities are restricted from doing business under regulations of the Office
of Foreign Asset Control (“OFAC”) of the Department of the Treasury (including those named on
OFAC’s Specially Designated and Blocked Persons List) or under any statute, executive order
(including Executive Order 13224 (the “Executive Order”) signed on September 24, 2001 and entitled
“Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or
Support Terrorism,” or other governmental action, (ii) that the Representing Party’s activities do
not violate the International Money Laundering Abatement and Financial Anti-Terrorism Act of 2001
or the regulations or orders promulgated thereunder (as amended from time to time, the “Money
Laundering Act”), and (iii) that throughout the Term the Representing Party shall comply with the
Executive Order and with the Money Laundering Act.
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(cc) When Payment Is Due. Whenever in this Lease a payment is required to be made by
one party to the other, but a specific date for payment is not set forth or a specific number of
days within which payment is to be made is not set forth, or the words “immediately”, “promptly”
and/or “on demand”, or the equivalent, are used to specify when such payment is due, then such
payment shall be due thirty (30) days after the party which is entitled to such payment sends
written notice to the other party demanding payment.
IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the date first above
written.
| LANDLORD: | BENTLY HOLDINGS CALIFORNIA LP, a California limited partnership |
|||||
| By: | /s/ Xxxxx Xxxxxx
|
|||||
| Name: Xxxxx Xxxxxx Its: CEO |
||||||
| By: | /s/ Amber Xxxxx Xxxxxx
|
|||||
| Name: Amber Xxxxx Xxxxxx Its: President |
||||||
| TENANT: | REDWOOD TRUST, INC., a Maryland corporation | |||||
| By: | /s/ Xxxxxx X. Xxxxxxx
|
|||||
| Name: Xxxxxx X. Xxxxxxx Its: CFO |
||||||
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EXHIBIT A
LEGAL DESCRIPTION OF THE PROPERTY
All that certain real property situated in the County of Marin, State of California, described as
follows:
PARCEL ONE:
PARCEL 2, as shown upon that certain map entitled, “Parcel Map, Xxxxxxx X. Xxxxxxxxxx, 2514 O.R.
36 and 2721 O.R. 177, Marin County, California”, filed for record August 22, 1974 in Volume 10 of
Parcel Maps, at Page 54, Marin County Records.
PARCEL TWO:
A NON-EXCLUSIVE EASEMENT for roadway and public utility purposes over the following described
property:
BEGINNING at a point called true point of beginning in the Memorandum of Lease recorded in Book
1965 of Official Records, at Page 240; thence along the Easterly line of Belvedere Drive on a curve
to the left, having a radius of 188.16 feet, whose center bears North 12o 57o 25o West through an
angle of 25o 24o 25o 83.44 feet; thence leaving said Drive on a curve to the left having a radius
of 20 feet, whose center bears Xxxxx 00x 00x 00x Xxxx through an angle of 48o 12o 10o 16.83 feet;
thence South 03o 26o West 155.95 feet to the Lands of Xxxxxxx Development Company recorded February
4, 1966 in Book 2022 of Official Records, at Page 393; thence along said Lands, South 50o 20o 34o
West 52.37 feet to an angle point in said Lands; thence leaving said Lands, North 03o 20o 17o West
13.69 feet to the corner of said Lands in the Memorandum of Lease; thence along said Lands, North
03o 26o East 133.47 feet; thence on a curve to the left, having a radius of 20 feet, whose center
bears North 86o 34o West through an angle of 106o 23o 25o a distance of 37.14 feet to the point of
beginning.
-1-
EXHIBIT B
DESCRIPTION OF THE PREMISES
-1-
EXHIBIT C
NOTICE OF LEASE TERM DATES
To: |
||||
Re:
|
Office Lease dated _______ , 2006, between Bently Holdings California LP, a California limited partnership (“Landlord”), and Redwood Trust, Inc., a Maryland corporation (“Tenant”), concerning Suite 200 on the Second Floor of the office building located within the Belvedere Place office center at Two Belvedere Place, Mill Valley, California |
Ladies and Gentlemen:
In accordance with the referenced Office Lease (the “Lease”), we wish to advise you and/or
confirm as follows:
1.
|
The Substantial Completion of the Premises has occurred, and the Term shall commence on or has commenced on for a term of months ending on . | |
2.
|
Rent commenced to accrue on _______ , in the amount of $ [INSERT BASIC RENT AND ADDITIONAL RENT]. | |
3.
|
If the Commencement Date is other than the first day of the month, the first billing will contain a pro rata adjustment. Each billing thereafter, with the exception of the final billing, shall be for the full amount of the monthly installment as provided for in the Lease. | |
4.
|
Your rent checks should be made payable to ___ ____ at _______. |
Initially capitalized terms used herein without definition shall have the respective meanings
given such terms in the Lease.
LANDLORD:
| Bently Holdings California LP, a California limited partnership |
||||||
| By: | /s/ Xxxxx Xxxxxx
|
|||||
| Name: Xxxxx Xxxxxx Title: CEO |
||||||
-1-
EXHIBIT D
FORM OF TENANT ESTOPPEL CERTIFICATE
TENANT ESTOPPEL CERTIFICATE
To: |
||||
Ladies and Gentlemen:
, a (“Tenant”) hereby certifies as follows:
1. The undersigned is the Tenant under that certain Office Lease dated
(the “Lease”), executed by BENTLY HODLINGS CALIFORNIA LP, a California limited partnership
(“Landlord”), as Landlord, and the undersigned, as Tenant, covering a portion of the
building located at Xxxxxxxxx Xxxxx, Xxxx Xxxxxx, Xxxxxxxxxx designated as Suite 200 and
located on Second Floor (the “Premises”). Initially capitalized terms used herein without
definition shall have the respective meanings given such terms in the Lease.
2. The Premises consists of approximately rentable square feet of
space. Tenant has paid to Landlord a security deposit of $ . The Term of the Lease
commenced on and the expiration of the Lease is . Tenant
has paid rent through
. The next rental payment in the amount of
$
is due on
. Tenant is required to pay
percent
( %) of all annual operating expenses for the Project in excess of
.
3. The Lease provides for an option to extend the Term of the Lease for
years. The rental rate for such extension term is as follows:
.
Except as expressly provided in the Lease, and other documents attached hereto, Tenant does not
have any right or option to renew or extend the Term of the Lease, to lease other space at the
Project, nor any preferential right to purchase all or any part of the Premises, the Building or
the Project.
4. True, correct and complete copies of the Lease and all amendments, modifications and
supplements thereto are attached hereto and the Lease, as so amended, modified and supplemented is
in full force and effect, and represents the entire agreement between Tenant and Landlord with
respect to the Premises, the Building and the Project. There are no amendments, modifications or
supplements to the Lease, whether oral or written, except as follows (include the date of such
amendment, modification or supplement):
| . | ||||
5. All space and improvements leased by the Tenant have been completed and furnished in
accordance with the provisions of the Lease, and the Tenant has accepted and taken possession of
the Premises.
-1-
6. To Tenant’s actual knowledge, Landlord is not in any respect in default in the
performance of the terms and provisions of the Lease. Tenant is not in any respect in default
under the Lease beyond all applicable notice and cure periods and has not assigned, transferred or
hypothecated the Lease or any interest therein or subleased all or any portion of the Premises.
7. There are no offsets or credits against rentals payable under the Lease and no free rent
periods or rental concessions have been granted to Tenant, except as
follows: .
8. If Tenant is a corporation or partnership, each individual executing this Certificate on
behalf of Tenant hereby represents and warrants that Tenant is a duly formed and existing entity
qualified to do business in the State of California and that Tenant has full right and authority to
execute and deliver this Certificate and that each person signing on behalf of Tenant is authorized
to do so.
9. This Certificate is given to with the understanding
that will rely hereon in connection with the conveyance/financing
of the Building or Project of which the Premises is a part. Following any
such conveyance/financing, Tenant agrees that this Lease shall remain in full force and effect and
shall bind and inure to the benefit of and its lenders, successors and assigns.
Tenant hereby expressly acknowledges and agrees that is relying upon
this Certificate.
| “Tenant” | ||||||
| , | ||||||
| a | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
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EXHIBIT E
RULES AND REGULATIONS
1. Tenant shall have access to the Building and the Premises at all times during the Term,
except to the extent otherwise necessary for emergencies, maintenance or repairs, which maintenance
and repairs shall be accomplished with as little interference to Tenant as commercially
reasonable. On all hours other than normal business hours for the Project (as defined in
Paragraph 19(iii) of these Rules and Regulations below), or such other hours as Landlord shall
determine from time to time, access to the Project and/or to the passageways, entrances, exits,
shipping areas, halls, corridors, elevators or stairways and other areas in the Project may be
restricted and access gained by use of a key/card key to the outside doors of the Project, or
pursuant to such security procedures as Landlord may from time to time impose. All such areas, and
all roofs, are not for use of the general public, and Landlord shall in all cases retain the right
to control and prevent access thereto by all persons whose presence in the judgment of Landlord
shall be prejudicial to the safety, character, reputation and interests of the Project and its
tenants, provided, however, that nothing herein contained shall be construed to prevent such access
to persons with whom Tenant deals in the normal course of Tenant’s business unless such persons are
engaged in activities which are illegal or violate these Rules. No Tenant Parties shall enter into
areas reserved for the exclusive use of Landlord Parties. Tenant shall keep doors to corridors and
lobbies closed except when persons are entering or leaving.
2. Tenant shall not paint, display, inscribe, maintain or affix any sign, placard, picture,
advertisement, name, notice, lettering or direction on any part of the outside or inside of the
Project, or on any part of the inside of the Premises which can be seen from the outside of the
Premises, without the prior consent of Landlord, and then only such name or names or matter and in
such color, size, style, character and material as may be first approved by Landlord in writing.
Landlord shall prescribe the suite number and identification sign for the Premises (which shall be
prepared and installed by Landlord at Tenant’s expense). Landlord reserves the right to remove at
Tenant’s expense all matter not so installed or approved without notice to Tenant.
3. Tenant shall not in any manner use the name of the Project for any purpose other than that
of the business address of the Tenant, or use any picture or likeness of the Project, in any
letterheads, envelopes, circulars, notices, advertisements, containers or wrapping material without
Landlord’s express written consent.
4. Tenant shall not place anything or allow anything to be placed in the Premises near the
glass of any door, partition, wall or window which may be unsightly from outside the Premises, and
Tenant shall not place or permit to be placed any article of any kind on any window ledge or on the
exterior walls. Blinds, shades, awnings or other forms of inside or outside window ventilators or
similar devices, shall not be placed in or about the outside windows in the Premises except to the
extent, if any, that the character, shape, color, material and make thereof are first approved by
Landlord in writing.
5. Furniture, freight and other large or heavy articles, and all other deliveries may be
brought into the Project only at times and in the manner designated by Landlord, and always at
Tenant’s sole responsibility and risk. Landlord may impose reasonable charges for use of freight
-1-
elevators after or before normal business hours. All damage done to the Project by moving or
maintaining such furniture, freight or articles shall be repaired by Landlord at Tenant’s expense.
Landlord may inspect items brought into the Project or Premises with respect to weight or
dangerous nature. Landlord may require that all furniture, equipment, cartons and similar articles
removed from the Premises or the Project be listed and a removal permit therefor first be obtained
from Landlord. Tenant shall not take or permit to be taken in or out of other entrances or
elevators of the Project any item normally taken, or which Landlord otherwise reasonably requires
to be taken, in or out through service doors or on freight elevators. Tenant shall not allow
anything to remain in or obstruct in any way, any lobby, corridor, sidewalk, passageway, entrance,
exit, hall, stairway, shipping area, or other such area. Tenant shall move all supplies, furniture
and equipment as soon as received directly to the Premises, and shall move all such items and
waste (other than waste customarily removed by Project employees) that are at any time being taken
from the Premises directly to the areas designated for disposal. Any handcarts used at the Project
shall have rubber wheels.
6. Tenant shall not overload any floor or part thereof in the Premises, or Project, including
any public corridors or elevators therein bringing in or removing any large or heavy articles, and
Landlord may direct and control the location of safes and all other heavy articles and require
supplementary supports at Tenant’s expense of such material and dimensions as Landlord may deem
necessary to properly distribute the weight.
7. Tenant shall not attach or permit to be attached additional locks or similar devices to any
door or window, change existing locks or the mechanism thereof, or make or permit to be made any
keys for any door other than those provided by Landlord. If more than two keys for one lock are
desired, Landlord will provide them upon payment therefor by Tenant. Tenant, upon termination of
its tenancy, shall deliver to Landlord all keys of offices, rooms and toilet rooms which have been
furnished Tenant or which Tenant shall have had made, and in the event of loss of any keys so
furnished shall pay Landlord therefor.
8. If Tenant desires signal, communication, alarm or other utility or similar service
connections installed or changed, Tenant shall not install or change the same without the prior
approval of Landlord, and then only under Landlord’s direction at Tenant’s expense. Tenant shall
not install in the Premises any equipment which requires more electric current than Landlord is
required to provide under this Lease, without Landlord’s prior written approval, and Tenant shall
ascertain from Landlord the maximum amount of load or demand for or use of electrical current which
can safely be permitted in the Premises, taking into account the capacity of electric wiring in the
Building and the Premises and the needs of tenants of the Building, and shall not in any event
connect a greater load than such safe capacity.
9. Tenant shall not obtain for use upon the Premises ice, drinking water, towel, janitorial
and other similar services, except from Persons approved by Landlord in writing. Any Person engaged
by Tenant to provide janitor or other services shall be subject to direction by the manager or
security personnel of the Project.
10. The toilet rooms, urinals, washbowls and other such apparatus shall not be used for any
purpose other than that for which they were constructed, and no foreign substance of any kind
whatsoever shall be thrown therein, and the expense of any breakage, stoppage or damage resulting
from the violation of this Rule shall be borne by Tenant who, or whose employees or invitees, shall
have caused it. Tenant shall not cause any unnecessary labor by reason of
-2-
Tenant’s carelessness or indifference in the preservation of good order and cleanliness in and
around the Project.
11. The janitorial closets, utility closets, telephone closets, broom closets, electrical
closets, storage closets, and other such closets, rooms and areas shall be used only for the
purposes and in the manner designated by Landlord, and may not be used by tenants, or their
contractors, agents, employees, or other parties, without Landlord’s prior written consent.
12. Landlord reserves the right to exclude or expel from the Project any person who, in the
judgment of Landlord, is intoxicated or under the influence of liquor or drugs, or who shall in any
manner do any act in violation of any of these Rules. Tenant shall not at any time manufacture,
sell, use or give away, any spirituous, fermented, intoxicating or alcoholic liquors on the
Premises, nor permit any of the same to occur (except in connection with occasional social or
business events conducted in the Premises which do not violate any laws nor bother or annoy any
other tenants). Tenant shall not at any time sell, purchase or give away food in any form by or to
any of the other Tenant Parties or any other parties on the Premises, nor permit any of the same to
occur (other than in lunchrooms or kitchens for employees).
13. Tenant shall not make any room-to-room canvass to solicit business or
information or to distribute any article or material to or from other tenants or occupants of the
Project and shall not exhibit, sell or offer to sell, use, rent or exchange any products or
services in or from the Premises unless ordinarily embraced within the Tenant’s use of the Premises
specified in the Lease.
14. Tenant shall not waste electricity, water, heat or air conditioning or other utilities or
services, and agrees to cooperate fully with Landlord to ensure the most effective and energy-efficient operation of the Project and shall not allow the adjustment (except by Landlord’s
authorized Project personnel) of any controls. Tenant shall keep corridor doors closed and shall
not open any windows, except that if the air circulation shall not be in operation, windows which
are openable may be opened with Landlord’s consent. As a condition to claiming any deficiency in
the air-conditioning or ventilation services provided by Landlord, Tenant shall close any blinds or
drapes in the Premises to prevent or minimize direct sunlight.
15. Tenant shall conduct no auction, fire or “going out of business” sale or bankruptcy
sale in or from the Premises, and such prohibition shall apply to Tenant’s creditors.
16. Tenant shall cooperate and comply with any reasonable safety or security programs,
including fire drills and air raid drills, and the appointment of “fire wardens” developed by
Landlord for the Project, or required by law. Before leaving the Premises unattended, Tenant
shall close and securely lock all doors or other means of entry to the Premises and shut off all
lights and water faucets in the Premises (except heat to the extent necessary to prevent the
freezing or bursting of pipes).
17. Tenant will comply with all municipal, county, state, federal or other
governmental laws, statutes, codes, regulations and other requirements, including without
limitation, environmental health, safety and police requirements and regulations respecting the
Premises, now or hereinafter in force, at its sole cost, and will not use the Premises for any
immoral purposes.
-3-
18. Tenant shall not carry on any business, activity or service except those ordinarily
embraced within the permitted use of the Premises specified in the Lease and more particularly, but
without limiting the generality of the foregoing, shall not install or operate any internal
combustion engine, boiler, machinery, refrigerating, heating or air conditioning equipment in or
about the Premises except as permitted by the Lease, use the Premises for housing, lodging or
sleeping purposes or for the washing of clothes, place any radio or television antennae other
than inside of the Premises except as permitted by the Lease, operate or permit to be operated
any musical or sound producing instrument or device which may be heard outside the Premises, use
any source of power other than electricity, operate any electrical or other device from which may
emanate electrical or other waves which may interfere with or impair radio, television, microwave,
or other broadcasting or reception from or in the Project or elsewhere, bring or permit any
bicycle or other vehicle, or dog (except in the company of a blind person or except where
specifically permitted) or other animal or bird in the Project, make or permit objectionable
noise or odor to emanate from the Premises, do anything in or about the Premises tending to
create or maintain a nuisance or do any act tending to injure the reputation of the Project,
throw or permit to be thrown or dropped any article from any window or other opening in the
Building, use or permit upon the Premises anything that will invalidate or increase the rate of
insurance on any policies of insurance now or hereafter carried on the Project or violate the
certificates of occupancy issued for the Premises or the Project, use the Premises for any
purpose, or permit upon the Premises anything, that may be dangerous to persons or property
(including but not limited to flammable oils, fluids, paints, chemicals, firearms or any explosive
articles or materials), do or permit anything to be done upon the Premises in any way tending to
disturb any other tenant at the Project or the occupants of neighboring property, or at any
time go upon the roof of the Building without prior approval from Landlord.
19. The following Rules shall apply regarding the parking area:
(i) Parking shall be available in areas designated generally for tenant parking. Tenant shall
have card-key access to the parking facilities 24 hours a day, seven day a week. In all cases,
parking for Tenant and the other Tenant Parties shall be on a “first come, first served,”
unassigned basis, with Landlord and other tenants at the Project, and their employees and
visitors, and other Persons to whom Landlord shall grant the right or who shall otherwise have the
right to use the same, all subject to these Rules, as the same may be amended or supplemented, and
applied on a non-discriminatory basis. Notwithstanding the foregoing to the contrary, Landlord
reserves the right to assign specific spaces, and to reserve spaces for visitors, small cars,
handicapped individuals, and other tenants, visitors of tenants or other Persons, and Tenant
Parties shall not park in any such assigned or reserved spaces. Landlord may restrict or prohibit
full size vans and other large vehicles.
(ii)
In case of any violation of these provisions, Landlord may refuse to permit the violator
to park, and may remove the vehicle owned or driven by the violator from the Project without
liability whatsoever, at such violator’s risk and expense. Landlord reserves the right to
temporarily close all or a portion of the parking areas or facilities in order to make repairs or
perform maintenance services, or to alter, modify, re-stripe or renovate the same, or if required
by casualty, strike, condemnation, act of God, law or governmental requirement, or any other reason
beyond Landlord’s reasonable control. In the event access is denied for any reason, any monthly
parking charges shall be abated to the extent access is denied, as Tenant’s sole recourse. Tenant
acknowledges that such parking areas or facilities may be operated by an independent contractor not
affiliated with Landlord, and Tenant acknowledges that in such event,
-4-
Landlord shall have no liability for claims arising through acts or omissions of such independent
contractor.
(iii) Normal business hours for the Project shall be 7 A.M. to 6 P.M., Monday through Friday,
and 9:00 A.M. to 12:00 P.M. on Saturdays, or such other hours as may be reasonably established by
Landlord or its parking operator from time to time. During such normal business hours, cars must
be parked entirely within the stall lines, and only small cars may be parked in areas reserved for
small or compact cars; all directional signs and arrows must be observed; the speed limit shall be
5 miles per hour; spaces reserved for handicapped parking must be used only by vehicles properly
designated; every xxxxxx is required to park and lock his own car; washing, waxing, cleaning or
servicing of any vehicle is prohibited; parking spaces may be used only for parking automobiles;
parking is prohibited in areas: (a) not striped or designated for parking, (b) aisles, (c) where
“no parking” signs are posted, (d) on ramps, and (e) loading areas and other specially designated
areas. Delivery trucks and vehicles shall use only those areas designated therefor.
20. The directory of the Building will be provided for the display of the name and location of
tenants only, and Landlord reserves the right to exclude any other names therefrom. Any additional
name that Tenant shall desire to be placed upon the directory must first be approved by Landlord,
and if so approved, a charge will be made therefor.
21. Landlord may waive any one or more of these Rules for the benefit of a particular tenant,
but no such waiver by Landlord shall be construed as a waiver of these Rules in favor of any other
tenant nor prevent Landlord from thereafter enforcing any such Rules against any or all of the
tenants of the building.
22. Landlord reserves the right to make such other and reasonable rules as in its sole and
absolute discretion may from time to time be needed for the safety, care, efficiency, cleanliness,
management and operation of the building, and for the preservation of good order therein; provided,
however, that no such changes shall interfere with Tenant’s permitted use of the Premises. In the
event of a conflict between these Rules and Regulations and the Lease, the Lease shall control.
-5-
EXHIBIT F
BASE BUILDING STANDARD SHELL CONSTRUCTION SPECIFICATIONS
Floor:
|
Current floor covering is carpet. | |
Exterior Bldg. Walls:
|
Walls are insulated, finished with taped drywall and are painted. | |
Interior Demising Walls:
|
Demising walls are finish taped drywall and ready to receive tenant’s wall finish. | |
Ceiling:
|
Ceilings are left open to underside of slab above. | |
Fire Sprinklers:
|
Fire sprinklers are in upright pendant heads in general protective pattern. | |
Structural Elements:
|
Columns and roof trusses are exposed and can be used as architectural elements by the tenant or encased in drywall. (These elements do not require fireproofing.) | |
Mechanical:
|
Each floor contains a central water loop with approximately one zone per 2,000 square feet of space. The tenant is responsible for the distribution and thermostatic controls in the tenant space. Tenants may add additional zones (which require additional heat pumps) for private offices, heat-generating equipment or special requirements. | |
Electrical:
|
A panel board at the designated building electrical room is provided. | |
| The building has specified a 2 x 4-foot parawedge fluorescent fixture to be used by the tenant improvement contractors. The building will stipulate the layout of the lighting along the curtain wall for consistency. | ||
Telecommunications:
|
The building provides phone and cable connections to the designated main electrical/communications room for each floor. | |
Drapery:
|
A building standard window covering is provided. | |
Toilet rooms:
|
Toilet rooms are fully improved. | |
Multi-Tenant Floor:
|
The Building provides exit corridors, elevator lobbies and an entry door to each tenant space. Doors are wood birch, door frames are hollow metal, lobbies have a stone floor with carpet inset, door hardware is brushed |
-1-
| aluminum and the storefront and railings are aluminum and glass. | ||
Landscaping
|
Paving and landscaping are existing on exterior portions of the Project. |
-2-
TABLE OF CONTENTS
| Page | ||||
1. PREMISES |
1 | |||
(a) Initial Premises |
1 | |||
(b) Verification of Usable Square Feet of Premises, Building and Project |
1 | |||
2. TERM |
2 | |||
(a) Initial Term |
2 | |||
(b) Confirmation of Lease Term |
2 | |||
(c) Lease Years |
2 | |||
3. BASIC RENT |
2 | |||
(a) Basic Rent Payments |
2 | |||
(b) Adjustment in Basic Rent |
3 | |||
(c) Late Charge |
3 | |||
4. ADDITIONAL RENT |
4 | |||
(a) Estimated Operating Expenses |
4 | |||
(b) Actual Operating Expenses |
4 | |||
(c) Determinations |
5 | |||
(d) End of Term |
5 | |||
(e) Definitions |
5 | |||
5. INTENTIONALLY OMITTED |
||||
6. USES; HAZARDOUS MATERIAL |
9 | |||
(a) Use |
9 | |||
(b) Hazardous Material |
10 | |||
(c) Environmental Obligations |
11 | |||
7. MAINTENANCE AND REPAIRS |
11 | |||
(a) Landlord’s Obligations |
11 | |||
(b) Tenant’s Obligations |
13 | |||
8. ALTERATIONS |
13 | |||
(a) Landlord’s Consent |
13 | |||
(b) Performance of Work |
13 | |||
(c) Landlord’s Expenses; Administrative Fee |
14 | |||
9. TENANT’S PROPERTY |
14 | |||
(a) Removal Upon Expiration of Lease |
14 | |||
(b) Personal Property Taxes |
15 | |||
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10. ENTRY BY LANDLORD |
15 | |||
11. LIENS |
16 | |||
12. INDEMNIFICATION |
16 | |||
(a) Indemnity by Tenant |
16 | |||
(b) Indemnity by Landlord |
16 | |||
13. DAMAGE TO TENANT’S PROPERTY |
17 | |||
14. INSURANCE |
17 | |||
(a) Tenant’s Insurance |
17 | |||
(b) Landlord’s Insurance |
18 | |||
15. WAIVER OF SUBROGATION |
19 | |||
16. CASUALTY |
19 | |||
(a) Repair and Restoration |
19 | |||
(b) Uninsured Casualties |
20 | |||
(c) Tenant’s Termination Right |
20 | |||
(d) Termination of Lease |
21 | |||
(e) Rent Abatement |
21 | |||
(f) Extent of Repair Obligation |
21 | |||
(g) Waiver |
21 | |||
17. CONDEMNATION |
21 | |||
(a) Complete Taking |
21 | |||
(b) Partial Taking |
22 | |||
(c) Award |
22 | |||
(d) Waiver |
22 | |||
18. ASSIGNMENT OR SUBLETTING |
22 | |||
(a) Landlord’s Consent |
22 | |||
(b) Notice to Landlord |
22 | |||
(c) Permitted Transfers |
23 | |||
(d) Continuing Liability |
24 | |||
(e) Assumption by Transferee |
24 | |||
(f) Default; Waiver |
24 | |||
(g) Intentionally Omitted |
24 | |||
(h) Use by Affiliates |
24 | |||
(i) Recognition Agreement |
25 | |||
(j) Occupancy By Others |
25 | |||
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19. SUBORDINATION AND XXX-XXXXXXXXXXX |
00 | |||
00. ESTOPPEL CERTIFICATE |
25 | |||
21. SERVICES |
26 | |||
(a) Standard Services |
26 | |||
(b) Overstandard Use |
27 | |||
(c) Abatement of Rent |
27 | |||
22. SIGNS AND ADVERTISING |
28 | |||
23. PARKING |
28 | |||
24. RULES AND REGULATIONS |
29 | |||
25. TIME |
29 | |||
26. OUIET ENJOYMENT |
29 | |||
27. DEFAULTS AND REMEDIES |
29 | |||
(a) Defaults |
29 | |||
(b) Remedies |
29 | |||
(c) Re-entry |
31 | |||
(d) Remedies Cumulative; Waiver |
31 | |||
28. TRANSFER OF LANDLORD’S XXXXXXXX |
00 | |||
00. RIGHT TO PERFORM |
31 | |||
30. TENANT IMPROVEMENTS |
32 | |||
(a) Certain Definitions |
32 | |||
(1) Tenant Improvements |
32 | |||
(2) Tenant Improvement Allowance |
32 | |||
(3) Substantial Completion; Punch List Items |
32 | |||
(4) Construction Costs |
32 | |||
(5) Building Plans |
32 | |||
(6) Base Building Work |
32 | |||
(7) Delivery Condition |
32 | |||
(8) Force Majeure Delay |
32 | |||
(9) Landlord Delay |
33 | |||
(10) Tenant’s Contractor |
33 | |||
(11) Material Change Order |
33 | |||
(12) Tenant’s Architect |
33 | |||
(b) Plans and Drawings |
33 | |||
(c) Payment of Tenant Improvement Allowance |
34 | |||
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| Page | ||||
(d) Miscellaneous Charges |
35 | |||
(e) Use of Conduits, Risers and Raceways |
35 | |||
(f) Codes/Hazardous Materials |
35 | |||
(g) Fee to Landlord |
35 | |||
31. NOTICES |
35 | |||
32. ATTORNEYS’ FEES |
36 | |||
33. HOLDING OVER |
36 | |||
34. SURRENDER OF PREMISES |
37 | |||
35. NON-WAIVER |
37 | |||
36. MORTGAGE PROTECTION |
37 | |||
37. EXPEDITED DISPUTE RESOLUTION |
37 | |||
(a) Arbitration Panel |
38 | |||
(b) Duty |
38 | |||
(c) Xxxxxxxxx |
00 | |||
(x) Xxxxxx |
00 | |||
00. CHANGES TO THE PROJECT |
39 | |||
39. WAIVER OF JURY TRIAL |
39 | |||
40. OPTIONS TO EXTEND THE TERM |
40 | |||
(a) Extension Terms |
40 | |||
(1) First Extension Term |
40 | |||
(2) Second Extension Term |
40 | |||
(b) Extension Term Rent |
40 | |||
41. GENERAL PROVISIONS |
42 | |||
(a) Entire Agreement |
42 | |||
(b) Terms and Headings |
42 | |||
(c) Successors and Assigns |
42 | |||
(d) Brokers |
42 | |||
(e) Liability of Landlord |
43 | |||
(f) Independent Covenants |
43 | |||
(g) Waiver of Redemption by Tenant |
43 | |||
(h) Severability |
43 | |||
(i) Force Majeure |
43 | |||
(j) Intentionally Omitted |
43 | |||
(k) Examination of Lease |
44 | |||
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| Page | ||||
(1) No Warranty |
44 | |||
(m) Right to Lease |
44 | |||
(n) Transportation Management |
44 | |||
(o) Modification for Lender |
44 | |||
(p) Requirements of Law |
44 | |||
(q) Recording |
44 | |||
(r) Applicable Laws |
45 | |||
(s) Relationship of Parties |
45 | |||
(t) Landlord’s Title |
45 | |||
(u) Project or Building Name and Storage |
45 | |||
(v) Survival of Obligations |
45 | |||
(w) Authority |
45 | |||
(x) Execution in Counterparts |
45 | |||
(y) Consent/Duty to Act Reasonably |
45 | |||
(z) Landlord Bankruptcy Proceeding |
45 | |||
(aa) Access |
46 | |||
(bb) Prohibited Persons and Transactions |
46 | |||
(cc) When Payment Is Due |
47 |
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