Exhibit 10.17
SUBLEASE
INFINIUM SOTWARE, INC.
a Massachusetts corporation
"Sublandlord"
and
QUALITY SYSTEMS, INC.
a California corporation
"Subtenant"
for the premises
located on the 4th floor
of Lakeshore Towers Building II,
00000 Xxx Xxxxxx Xxxxxx,
Xxxxx 000
Xxxxxx, Xxxxxxxxxx
SUBLEASE
THIS SUBLEASE (this "Sublease") is made and entered into as of the 22nd
day of February 2002, by and between INFINIUM SOFTWARE, INC., a Massachusetts
corporation ("Sublandlord"), and QUALITY SYSTEMS, INC., a California
corporation, a ("Subtenant");
W I T N E S S E T H:
A. By that certain Office Lease dated November 15, 1999 (the "Prime
Lease"), Lakeshore Towers Limited Partnerships Phase IV, a California limited
partnership (together with its successors and assigns, "Landlord"), leased to
Sublandlord Suite 420 on the fourth (4th) floor of the building known as
Lakeshore Towers Building II, 18191 Xxx Xxxxxx Avenue, Irvine, California (the
"Building"), containing approximately 11,803 rentable (10,472 usable) square
feet of space, as more particularly shown on Exhibit A to the Prime lease (the
"Premises"), for a term commencing on [May 1, 2000] and ending on [April 30,
2005]. A copy of the Prime Lease is attached hereto and incorporated herein as
Exhibit A. Initially capitalized terms used and not otherwise defined herein
shall have the meanings given thereto in the Prime Lease.
B. Subject to the consent of Landlord as set forth in Section 18 hereof,
Subtenant desires to sublease from Sublandlord, and Sublandlord desires to
sublease to Subtenant, the Premises upon the terms and conditions hereinafter
set forth.
A G R E E M E N T
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and promises contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby mutually
acknowledged, Sublandlord and Subtenant hereby agree as follows:
1. Premises; Use.
(a) Sublandlord hereby subleases to Subtenant, and Subtenant hereby
subleases from Sublandlord, the Premises upon the terms and conditions
hereinafter set forth.
(b) Subtenant shall use the Premises solely for the Permitted Use, and
Subtenant shall not use or permit the Premises or the Project to be used for any
other purpose or purposes whatsoever without the prior written consent of (i)
Sublandlord, which may be withheld in Sublandlord's reasonable discretion, and
(ii) Landlord, which may be withheld in Landlord's sole discretion.
2. Term. The term of this Sublease (the "Sublease Term") shall commence on
May 15, 2002 (the "Commencement Date"), and, unless sooner terminated pursuant
to the provisions hereof, shall terminate on the earlier of April 30, 2005 or
the prior expiration or termination of the term of the Prime Lease. Without
limiting the foregoing, subject to the consent of Landlord as set forth in
Section 18 hereof, Subtenant may enter the Premises during the four (4) week
period immediately preceding the Commencement Date for the sole purpose of
performing the Subtenant's Improvements (as defined below), provided that
Subtenant shall comply with all terms and conditions of this Sublease (other
than payment of Rent) during such early access period.
3. Base Rent.
(a) Subtenant shall pay Sublandlord base rent for the Premises ("Base
Rent") in monthly installments in accordance with the following schedule,
subject to the provisions of Section 21(b) below with respect to the "Base Rent
Credit":
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Annual Rental Rate per
Monthly Installment of Rentable
Period Annual Base Rent Base Rent Square Foot
--------------------------------------------------------------------------------------------------
May 15, 2002 - April 30, 2003 $191,208.60 $15,934.05 $1.35
--------------------------------------------------------------------------------------------------
May 1, 2003 - April 30, 2004 $262,026.60 $21,835.55 $1.85
--------------------------------------------------------------------------------------------------
May 1, 2004 - April 30, 2005 $332,844.60 $27,737.05 $2.35
--------------------------------------------------------------------------------------------------
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(b) Each monthly installment of Base Rent shall be due and payable
in advance on the (1st) day of each calendar month of the
Sublease Term; provided, however, that (i) if the Sublease
Term commences on a day other than the first day of a month or
ends on a day other than the last day of a month, Base Rent
for such month shall be prorated; and (ii) one (1) month's
Base Rent in the amount of $15,934.05 shall be paid on the
date of execution and delivery of this Sublease by Subtenant.
Base Rent paid under the foregoing clause (ii) shall be
applied to Subtenant's obligations with respect to Base Rent
for the period from July 1, 2002 through July 31, 2002 (it
being understood and agreed that Subtenant shall have rent
abated for the first 45 days of the Sublease Term).
(c) All Base Rent and additional rent hereunder shall be paid
without setoff or deduction whatsoever and shall be paid to
Sublandlord at its office at 00 Xxxxxxxxxxxxxx Xxx, Xxxxxxx,
Xxxxxxxxxxxxx 00000 or at such other place as Sublandlord may
designate by notice to Subtenant.
4. Additional Rent; Payments; Interest.
(a) As used herein, the following definitions shall apply:
(i) "Sublease Base Year" shall mean calendar year 2002.
(ii) "Sublease Base Taxes" shall mean the amount of Tax Expenses
for the Sublease Base Year attributable to the valuation of
the Project, inclusive of tenant improvements. If in any
comparison year subsequent to the Sublease Base Year the
amount of Tax Expenses decreases below the amount of Sublease
Base Taxes for the Premises, then for purposes of all
subsequent comparison years, including the comparison year in
which such decrease in Tax Expenses occurred, the Sublease
Base Taxes and therefore the Sublease Base Year shall be
decreased by an amount equal to the decrease in Tax Expenses.
(iii) "Subtenant's Share" shall mean 100% of Tenant's Share, as such
term is defined in Section 4.2.9 of the Prime Lease.
(b) In addition to paying the Base Rent specified in Section 3 hereof,
Subtenant shall pay Subtenant's Share (as hereafter defined) of the annual
Building Direct Expenses which are in excess of the amount of Building Direct
Expenses for the Sublease Base Year (as hereafter defined); provided, however,
that in no event shall any decrease in Building Direct Expenses for any Expense
Year below Building Direct Expenses for the Sublease Base Year entitle Subtenant
to any decrease in Base Rent or any credit against sums due under this Sublease.
Such payments by Subtenant, together with any and all other amounts payable by
Subtenant to Sublandlord pursuant to the terms of this Sublease, are hereinafter
collectively referred to as the "Additional Rent," and the Base Rent and the
Additional Rent are herein collectively referred to as "Rent." All amounts due
under this paragraph as Additional Rent shall be payable for the same periods
and in the same manner as the Base Rent hereunder. Without limitation on other
obligations of Subtenant which survive the expiration of the Sublease Term, the
obligations of Subtenant to pay the Additional Rent provided for in this Section
shall survive the expiration of the term hereof.
(c) If for any Expense Year ending or commencing within the term of this
Sublease, the applicable Subtenant's Share of Building Direct Expenses for such
Expense Year exceeds the Subtenant's Share of Building Direct Expense for the
Sublease Base Year for the Premises, then Subtenant shall pay Sublandlord, in
the manner set forth below, as additional rent, an amount equal to the excess
("Sublease Excess").
(i) Sublandlord shall give Subtenant a copy of the Statement (as
defined in Section 4.4.1 of the Prime Lease) for each Expense
Year following receipt thereof by Sublandlord from Prime
Landlord. Such Statement shall be accompanied by an invoice
from Sublandlord
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which shall indicate the amount of the Sublease Excess for the
applicable Expense Year. Upon receipt of the Statement and
accompanying invoice for each Expense Year commencing or
ending during the Sublease Term, if a Sublease Excess is
present, Subtenant shall pay, with its next installment of
Base Rent due, the full amount of the Sublease Excess for such
Expense Year, less the amounts, if any, paid during such
Expense Year as "Estimated Sublease Excess," as that term is
defined below, and if Subtenant paid more as Estimated
Sublease Excess than the actual Sublease Excess, then
Subtenant shall receive a credit in the amount of Subtenant's
overpayment against Rent next to under this Sublease. Neither
the failure of Sublandlord to timely furnish the Statement or
accompanying invoice for any Expense Year, nor Sublandlord's
submission of a Statement or invoice correcting or modifying a
Statement or invoice previously delivered to Subtenant, shall
prejudice Sublandlord from enforcing its rights under this
Section. Even though the Sublease Term has expired or been
terminated and Subtenant has vacated the Premises, when the
final determination is made of Subtenant's Share of Building
Direct Expenses for the Expense Year in which this Sublease
expires or terminates, if a Sublease Excess is present, then
Subtenant shall immediately pay to Sublandlord such amount,
and if Subtenant paid more as Estimated Sublease Excess than
the actual Sublease Excess for such Expense Year, then
Sublandlord shall, within 30 days, deliver a check payable to
Subtenant in the amount of the overpayment. The provisions of
this Section shall survive the expiration or earlier
termination of the Sublease Term.
(ii) In addition, Sublandlord shall deliver to Subtenant a copy of
each Estimate Statement received by Sublandlord from Prime
Landlord under Section 4.4.2 of the Prime Lease setting forth
the Estimate of what the total amount of Building Direct
Expenses for the then current Expense Year shall be and the
Estimated Excess for such Expense Year. Each Estimate
Statement shall be accompanied by an estimate of the Sublease
Excess for the applicable Expense Year (the "Estimated
Sublease Excess") as calculated by comparing the Building
Direct Expenses for such Expense Year, as set forth in the
Estimate, to the amount of Building Direct Expenses for the
Sublease Base Year. The failure of Sublandlord to timely
furnish the Estimate Statement for any Expense Year or a
statement of the Estimated Sublease Excess for any such
Expense Year shall not preclude Sublandlord from enforcing its
rights to collect any Estimated Sublease Excess under this
Section, nor shall Sublandlord be prohibited from revising any
Estimate Statement or statement of Estimated Sublease Excess
theretofore delivered to extent necessary. Thereafter,
Subtenant shall pay, with its next installment of Base Rent
due, a fraction of the Estimated Sublease Excess for the then
current Expense Year (reduced by any amounts paid pursuant to
the last sentence of this subsection (ii) below). Such
fraction shall have as its numerator the number of months
which have elapsed in such current Expense Year, including the
month of such payment, and twelve (12) as its denominator.
Until a new Estimate Statement is furnished (which may be
delivered to Subtenant at any time), Subtenant shall pay
monthly, with the monthly Base Rent installments, an amount
equal to one-twelfth (1/12) of the total Sublease Excess set
forth with the previous Estimate Statement delivered by
Sublandlord to Subtenant.
(d) In addition to Base Rent under Section 3 and Subtenant's Share of
Building Direct Expenses under the foregoing provisions of this Section 4,
Subtenant shall pay Sublandlord, as Additional Rent, all amounts for which
Tenant is responsible under the Prime Lease other than "Base Rent" and Tenant's
Share of Building Direct Expenses, including, without limitation, the following
amounts: (i) charges by Landlord for furnishing air conditioning or heating to
the Premises at times in addition to those certain times specified in Section
6.1 of the Prime Lease; (ii) costs for utility consumption as provided in
Section 6.2 of the Prime Lease; (iii) costs incurred by Landlord in repairing
damage to the Building beyond ordinary wear and tear caused by Subtenant or any
of its agents, employees, contractors, customers or invitees; (iv) costs of
increased insurance premiums due as a result of Subtenant's use of the Premises;
(v) amounts expended or incurred by Landlord on account of any default by
Subtenant which gives rise to a default under the Prime Lease; (vi) personal
property taxes with respect to the FF&E (as defined below) and any personal
property or equipment of Subtenant; (vii) amounts charged by Landlord for
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parking pursuant to Article 28 of the Prime Lease, including, without
limitation, any taxes imposed by any governmental authority in connection with
the renting of parking spaces by Subtenant or the use of parking facilities by
Subtenant and any deposits required by Prime Landlord for parking access cards.
(e) Each amount due to Sublandlord pursuant to Subsection 4(a) and Section
4(b) above and each other amount payable by Subtenant hereunder shall be due and
payable with the next installment of Base Rent due after Landlord or Sublandlord
has given notice to Subtenant of the amount thereof, unless an earlier date for
payment of such amount is provided for elsewhere in this Sublease or the Prime
Lease, in which case such amount shall be due and payable on the earliest of
such dates; provided, however, that (i) Subtenant's Share of Estimated Sublease
Excess shall be due and payable on the same day that Base Rent hereunder is due
and payable for any applicable month, and (ii) in no event shall Subtenant pay
any additional rent other than Estimated Sublease Excess later than the date on
which such amount is due and payable under the Prime Lease.
(f) All amounts other than Base Rent payable to Sublandlord under this
Sublease shall be deemed to be additional rent due under this Sublease. All past
due installments of Base Rent and additional rent shall bear interest from the
date due until the date paid at the rate of one and one-half percent (1.5%) per
month, unless a lesser rate shall then be the maximum rate permissible by law
with respect thereto, in which event said lesser rate shall be charged (such
rate being referred to herein as the "Default Rate").
(g) Subtenant shall pay Landlord on the due dates for services requested
by Subtenant which are billed by Landlord directly to Subtenant rather than
Sublandlord.
5. FF&E; Condition of Premises; Construction of Improvements; Surrender of
Premises.
(a) Subtenant shall have the right to use the furniture, fixtures and
equipment located in the Premises and described on Exhibit B attached hereto and
incorporated herein by this reference (the "FF&E") until the expiration or
earlier termination of the term of this Sublease or of Subtenant's right to
possession of the Premises. Subtenant shall maintain the FF&E in as good
condition as same were in on the Commencement Date, ordinary wear and tear and
damage from fire or other casualty excepted. Without limiting any rights or
remedies of Sublandlord or any obligations of Subtenant hereunder, Subtenant
shall pay any personal property taxes assessed against the FF&E to the
applicable assessing authority on or before the date when same is due without
penalty or interest (or such earlier date as may be required hereunder or under
the Prime Lease). Subject to the provisions of the next sentence of this Section
5(a), Subtenant shall also (i) pay for and maintain, at all times during the
term hereof, property insurance insuring the FF&E for full replacement value,
with a deductible amount not to exceed $1,000, and (ii) deliver a certificate of
insurance satisfactory to Sublandlord and evidencing such coverage to
Sublandlord prior to the Commencement Date and deliver renewal certificates to
Sublandlord not later than thirty (30) days prior to each scheduled date of
expiration of the applicable policy. Notwithstanding the provisions of the
immediately preceding sentence, at Subtenant's option, Subtenant shall have the
right to self-insure the FF&E, provided, however, that if Subtenant elects to do
so, Subtenant shall be responsible for any loss or damage to the FF&E arising
from theft, fire or other casualty covered by insurance otherwise required to be
maintained by Subtenant hereunder. Provided that Subtenant is not in default of
any of its obligations under this Sublease, Sublandlord shall sell, transfer and
convey the FF&E to Subtenant upon the expiration of the Sublease Term (or
earlier termination of the Sublease Term if such earlier termination is not
caused by Subtenant's default) for and in consideration of the sum of one dollar
($1.00).
(b) Subject to the provisions of Section 21(a) below, Subtenant hereby
accepts the Premises, the Building and the FF&E "AS-IS; WHERE IS, WITH ALL
FAULTS." Subtenant expressly acknowledges and agrees that neither Sublandlord,
nor any of its agents, contractors or employees has made any representation or
warranty whatsoever with respect to the condition of the Premises, the Building
or the FF&E, but if any such representations and warranties were made, same are
hereby expressly disclaimed by Sublandlord and waived by Subtenant, Subtenant
hereby agreeing that it has not and will not rely upon same. Without limiting
the foregoing, Subtenant's taking possession of the Premises shall be conclusive
evidence as against Sublandlord and Landlord that the Premises, the Building and
the FF&E were in good order and satisfactory condition when Subtenant took
possession subject to the provisions of Section 21(a) below.
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(c) Upon the expiration or earlier termination of the term hereof, or upon
any earlier termination of Subtenant's right to possession of the Premises,
Subtenant shall (i) surrender the Premises and the FF&E (unless Subtenant elects
to purchase the FF&E under, and subject to, the terms of Section 5(a) above, in
which case Subtenant shall remove the FF&E from the Premises upon the date of
such expiration or termination and repair any damage to the Premises resulting
therefrom at Subtenant's sole cost and expense) and deliver the same to
Sublandlord broom-clean and in at least as good condition as same were in as of
the date of commencement of the term of this Sublease, ordinary wear and tear
and damage from fire or other casualty excepted; (ii) deliver to Sublandlord all
keys to the Premises; (iii) remove all trade fixtures and personal property
placed in the Premises by Subtenant; (iv) remove all alterations, additions,
improvements, demising walls, cabling and the like installed by Subtenant
(unless Landlord consents to same remaining at the Premises in writing pursuant
to Section 18 hereof); and (v) repair all damage caused by such removal. All
items not so removed shall be deemed to have been abandoned by Subtenant and may
be appropriated, sold, stored, destroyed, or otherwise disposed of by
Sublandlord without notice to Subtenant and without any obligation to account
for such items.
6. The Prime Lease.
(a) This Sublease and all rights of Subtenant hereunder and with respect
to the Premises are subject to the terms, conditions and provisions of the Prime
Lease. Subtenant hereby assumes and agrees to perform faithfully and be bound
by, with respect to the Premises, all of Sublandlord's obligations, covenants,
agreements and liabilities under the Prime Lease (including, without limitation,
those under Article 28 thereof) and all terms, conditions, provisions and
restrictions contained in the Prime Lease, except for:
(i) the payment of "Base Rent" (as defined in the Prime Lease) and
Tenant's Share of Building Direct Expenses; and
(ii) the following provisions of the Prime Lease, which shall not
apply to this Sublease: (A) the words "[E]xcept as
specifically set forth in this Lease and the Tenant Work
Letter attached hereto as Exhibit B (the 'Tenant Work
Letter')" in lines 15 and 16 of Section 1.1.1 of the Prime
Lease; (B) Section 1.3 (Right of First Offer); (C) Article 2
(Lease Term; Option Term); (D) Section 4.7 (Security Deposit);
(E) the last sentence of Section 8.1; (F) Section 8.7
(Telecommunications Equipment); (G) Section 23.5 (Tenant's
Signs); (H) Exhibit B (Tenant Work Letter); (I) Exhibit F
(Sign Program for Lakeshore Towers); (J) any provisions in the
Prime Lease allowing or purporting to allow Sublandlord any
rent concessions or abatements or construction allowances; and
(K) any provisions in the Prime Lease conferring upon Tenant
any rights, privileges, or options or reservations in the
Building except as may be provided herein.
(b) Without limiting the foregoing:
(i) Subtenant shall not make any changes, alterations or additions
in or to the Premises except for Subtenant's Improvements as
provided in Section 21(b) below, and then only to the extent
of Prime Landlord's consent thereto in writing under Section
18 hereof;
(ii) If Subtenant desires to take any other action and the Prime
Lease would require that Sublandlord obtain the consent of
Landlord before undertaking any action of the same kind,
Subtenant shall not undertake the same without the prior
written consent of Sublandlord. Sublandlord may condition its
consent on the consent of Landlord being obtained and may
require Subtenant to contact Landlord directly for such
consent;
(iii) All rights given to Landlord and its agents and
representatives by the Prime Lease to enter the premises
covered by the Prime Lease shall inure to the benefit of
Sublandlord and their respective agents and representatives
with respect to the Premises;
(iv) Sublandlord shall also have all other rights, privileges,
options, reservations and remedies granted or allowed to, or
held by, Landlord under the Prime Lease;
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(v) Subtenant shall maintain insurance of the kinds and in the
amounts required to be maintained by Sublandlord under the
Prime Lease. All policies of liability insurance shall name as
additional insureds the Landlord and Sublandlord and their
respective officers, directors or partners, as the case may
be, and the respective agents and employees of each of them;
and
(vi) Neither Sublandlord nor Subtenant shall do anything or suffer
or permit anything to be done which could result in a default
under the Prime Lease or permit the Prime Lease to be
cancelled or terminated.
(c) Notwithstanding anything contained herein or in the Prime Lease which
may appear to be to the contrary, Sublandlord and Subtenant hereby agree as
follows:
(i) Subtenant shall not without the consent of (i) Sublandlord,
which consent shall not be unreasonably withheld, and (ii)
Landlord, which consent may be given or withheld as set forth
in the Prime Lease, assign, mortgage, pledge, hypothecate or
otherwise transfer or permit the transfer of this Sublease or
any interest of Subtenant in this Sublease, by operation of
law or otherwise, or permit the use of the Premises or any
part thereof by any persons other than Subtenant and
Subtenant's employees, or sublet the Premises or any part
thereof; provided, however, that it is specifically agreed
that Prime Lease Article 14.6 (Non-Transfer) shall apply to
Subtenant;
(ii) Neither rental nor other payments hereunder shall xxxxx by
reason of any damage to or destruction of the Premises or the
FF&E, the premises subject to the Prime Lease, or the Building
or any part thereof, unless, and then only to the extent that,
rental and such other applicable payments actually xxxxx under
the Prime Lease with respect to the Premises on account of
such event;
(iii) Subtenant shall not have any right to any portion of the
proceeds of any award for a condemnation or other taking, or a
conveyance in lieu thereof, of all or any portion of the
Building, the premises subject to the Prime Lease or the
Premises by virtue of this Sublease;
(iv) Subtenant shall not have any right to exercise or have
Sublandlord exercise any option under the Prime Lease,
including, without limitation, any option to extend the term
of the Prime Lease or lease additional space; and
(v) In the event of any conflict between the terms, conditions and
provisions of the Prime Lease and of this Sublease, the terms,
conditions and provisions of this Sublease shall, in all
instances, govern and control.
(d) It is expressly understood and agreed that Sublandlord does not assume
and shall not have any of the obligations or liabilities of Landlord under the
Prime Lease and that Sublandlord is not making the representations or
warranties, if any, made by Landlord in the Prime Lease. With respect to work,
services, repairs and restoration or the performance of other obligations
required of Landlord under the Prime Lease, Sublandlord's sole obligation with
respect thereto shall be to request the same, upon written request from
Subtenant, and to use reasonable efforts to obtain the same from Landlord.
Sublandlord shall not be liable in damages, nor shall rent xxxxx hereunder, for
or on account of any failure by Landlord to perform the obligations and duties
imposed on it under the Prime Lease.
(e) Nothing contained in this Sublease shall be construed to create
privity of estate or contract between Subtenant and Landlord, except the
agreements of Subtenant in Sections 10 and 11 hereof in favor of Landlord, and
then only to the extent of the same.
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7. Default by Subtenant.
(a) Upon the happening of any of the following:
(i) Subtenant fails to pay any Base Rent or any other amount due
from Subtenant hereunder and such failure continues for five
(5) business days after notice thereof from Sublandlord to
Subtenant;
(ii) Subtenant fails to perform or observe any other covenant or
agreement set forth in this Sublease and such failure
continues for fifteen (15) days after notice thereof from
Sublandlord to Subtenant, except that Subtenant shall not be
in default if said failure cannot be cured within fifteen (15)
days after the date of such notice provided that Subtenant
commences to cure within fifteen (15) days after the date of
such notice, thereafter diligently pursues curing of the
failure and completes such cure within thirty (30) days after
the date of the initial notice from Sublandlord; or
(iii) any other event occurs which involves Subtenant or the
Premises and which would constitute a default under the Prime
Lease if it involved Sublandlord or the premises covered by
the Prime Lease;
Subtenant shall be deemed to be in default hereunder, and Sublandlord may
exercise, without limiting any other rights or remedies available to it
hereunder or at law or in equity, any and all rights and remedies of Landlord
set forth in the Prime Lease in the event of a default by Sublandlord
thereunder.
(b) In the event Subtenant fails or refuses to make any payment or perform
any covenant or agreement to be performed hereunder by Subtenant, Sublandlord
may make such payment or undertake to perform such covenant or agreement (but
shall not have any obligation to Subtenant to do so). In such event, amounts so
paid or expended in undertaking such performance, together with all costs,
expenses and attorneys' fees incurred by Sublandlord in connection therewith and
interest on such amounts from the date when so paid or expended at the Default
Rate, shall be additional rent hereunder.
8. Nonwaiver. Failure of Sublandlord to declare any default or delay in
taking any action in connection therewith shall not waive such default. No
receipt of moneys by Sublandlord from Subtenant after the termination in any way
of the term or of Subtenant's right of possession hereunder or after the giving
of any notice shall reinstate, continue or extend the term or affect any notice
given to Subtenant or any suit commenced or judgment entered prior to receipt of
such moneys.
9. Cumulative Rights and Remedies. All rights and remedies of Sublandlord
under this Sublease shall be cumulative and none shall exclude any other rights
or remedies allowed by law.
10. Waiver of Claims and Indemnity.
(a) Subtenant hereby releases and waives any and all claims against
Landlord and Sublandlord and each of their respective officers, directors,
partners, agents and employees for injury or damage to person, property or
business sustained in the Premises by Subtenant during the term of this Sublease
other than by reason of Landlord's or Sublandlord's gross negligence or willful
misconduct and except in any case which would render this release and waiver
void under law.
(b) Subtenant agrees to indemnify, defend and hold harmless Landlord,
Sublandlord and the managing agent of the Building and each of their respective
officers, directors, partners, agents and employees, from and against any and
all claims, demands, costs and expenses of every kind and nature, including
attorneys' fees and litigation expenses, arising from Subtenant's use or
occupancy of the Premises, Subtenant's construction of any leasehold
improvements in the Premises or from any breach or default on the part of
Subtenant in the performance of any agreement or covenant of Subtenant to be
performed or performed under this Sublease or pursuant to the terms of this
Sublease, or from any negligent act or omission or intentional misconduct of
Subtenant or its agents,
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officers, employees, guests, servants, invitees or customers in or about the
Premises or the Building. In case any such proceeding is brought against any of
said indemnified parties, Subtenant covenants, if requested by Sublandlord, to
defend such proceeding at its sole cost and expense by legal counsel reasonably
satisfactory to Sublandlord.
(c) Subtenant and Sublandlord each shall indemnify and hold harmless the
other from and against any and all cost, expense or liability (including
reasonable attorneys' fees) incurred on account of such party's actions or the
actions of its employees, agents, licensees or contractors on or about the
Premises or the Building or on account of any breach or violation by the
indemnifying party of this Sublease or the Prime Lease, except to the extent
that the same is due to the negligence or willful misconduct of the other party
or its employees, agents, invitees, licensees, or contractors. Subtenant and
Sublandlord each hereby releases and waives any right or claim against the other
party for loss of business, loss of profits, inconvenience, or for any other
incidental or consequential damages relating to this Sublease.
11. Waiver of Subrogation. Anything in this Sublease to the contrary
notwithstanding, Sublandlord and Subtenant each hereby waive any and all rights
of recovery, claims, actions or causes of action against the other and the
officers, directors, partners, agents and employees of each of them, and
Subtenant hereby waives any and all rights of recovery, claims, actions or
causes of action against Landlord and its agents and employees for any loss or
damage that may occur to the Premises or the premises covered by the Prime
Lease, or any improvements thereto, or any personal property of any person
therein or in the Building, by reason of fire, the elements or any other cause
insured against under valid and collectible fire and extended coverage insurance
policies, regardless of cause or origin, including negligence, except in any
case which would render this waiver void under law, to the extent that such loss
or damage is actually recovered under said insurance policies.
12. Brokerage Commissions. Each party hereby represents and warrants to
the other that it has had no dealings with any real estate broker or agent in
connection with this Sublease other than Xxxxxxxx Xxxx Company ("Sublandlord's
Broker") and Xxxx Xxxxx Real Estate Services ("Subtenant's Broker," and together
with Sublandlord's Broker "Broker"), and that it knows of no real estate broker
or agent other than Broker who is or might be entitled to a commission in
connection with this Sublease. Sublandlord shall be responsible for payment of a
commission to Broker pursuant to a separate written agreement with Sublandlord's
Broker. Each party agrees to protect, defend, indemnify and hold the other
harmless from and against any and all claims inconsistent with the foregoing
representations and warranties for any brokerage, finder's or similar fee or
commission in connection with this Sublease, if such claims are based on or
relate to any act of the indemnifying party which is contrary to the foregoing
representations and warranties.
13. Successors and Assigns. This Sublease shall be binding upon and inure
to the benefit of the successors and assigns of Sublandlord and shall be binding
upon and inure to the benefit of the successors of Subtenant and, to the extent
any such assignment may be approved, Subtenant's assigns. The provisions of
Subsection 6(e) and Sections 10 and 11 hereof shall inure to the benefit of the
successors and assigns of Landlord.
14. Entire Agreement. This Sublease contains all the terms, covenants,
conditions and agreements between Sublandlord and Subtenant relating in any
manner to the rental, use and occupancy of the Premises. No prior agreement or
understanding pertaining to the same shall be valid or of any force or effect.
The terms, covenants and conditions of this Sublease cannot be altered, changed,
modified or added to except by a written instrument signed by Sublandlord and
Subtenant.
15. Notices.
(a) In the event any notice from the Landlord or otherwise relating to the
Prime Lease is delivered to the Premises or is otherwise received by Subtenant,
Subtenant shall, as soon thereafter as possible, but in any event within
twenty-four (24) hours, deliver such notice to Sublandlord if such notice is
written or advise Sublandlord thereof by telephone if such notice is oral.
(b) Notices and demands required or permitted to be given by either party
to the other with respect hereto or to the Premises shall be in writing and
shall not be effective for any purpose unless the same shall be
8
served either by personal delivery with a receipt requested, by overnight air
courier service or by United States certified or registered mail, return receipt
requested, postage prepaid:
if to Sublandlord: Infinium Software, Inc.
00 Xxxxxxxxxxxxxx Xxx
Xxxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xxxx Xxxxx Xxxx, Esq.
Vice President and Chief Legal Counsel
with a copy to: Xxxx and Xxxx LLP
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xxxx X. Xxxxxxx, Esq.
if to Subtenant: Quality Systems, Inc.
00000 Xxx Xxxxxx Xxx., #000
Xxxxxx, XX
Attn: Xx. Xxx Xxxxxxxxx, President
if to Landlord: at the address of Landlord as set
forth in the Prime Lease.
Notices and demands shall be deemed to have been given on the date when: (i)
deposited with the United States Postal Service, if mailed; (ii) delivered if
made by personal delivery; or (iii) deposited with the applicable overnight air
courier service, if sent by overnight mail. Either party may change its address
for receipt of notices by giving notice to the other party in accordance with
the foregoing provisions of this Section.
16. Authority of Subtenant. Each of Sublandlord and Subtenant represents
and warrants to the other that this Sublease has been duly authorized, executed
and delivered by and on behalf of such party and constitutes the valid,
enforceable and binding agreement of such party.
17. Security Deposit.
(a) Subtenant acknowledges that Sublandlord is unwilling to execute this
Sublease unless Subtenant provides Sublandlord with security for Subtenant's
obligations under this Sublease. Accordingly, Subtenant shall deliver to
Sublandlord, on the date that Subtenant executes and delivers this Sublease to
Sublandlord, a cash security deposit in the amount of $27,737.05 (the "Security
Deposit").
(b) In the event that Subtenant is in default, beyond the expiration of
applicable notice and cure periods, of any of its obligations under this
Sublease, then Sublandlord shall have the right, at any time after such event,
without giving any further notice to Subtenant, to apply all or part of the
Security Deposit to cure such default. In the event of any such application by
Sublandlord, Subtenant shall, within five (5) business days of written demand
therefor, restore the Security Deposit to the original amount required
hereunder.
(c) Sublandlord shall not be required to hold the Security Deposit in a
separate account, nor shall Subtenant be entitled to any interest earned with
respect thereto.
(d) To the extent that Sublandlord has not previously drawn upon the
Security Deposit, and to the extent that Subtenant is not otherwise in default
of its obligations under this Sublease as of the expiration or earlier
termination of this Sublease, Sublandlord shall promptly return the Security
Deposit to Subtenant.
(e) In no event shall the Security Deposit be deemed to be a prepayment of
rent or considered as a measure of liquidated damages.
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18. Consent of Landlord. The obligations of Sublandlord and Subtenant
under this Sublease, and the right of Subtenant to perform the Subtenant
Improvements, are conditioned and contingent upon the Landlord consenting
hereto. In the event Landlord's consent is not obtained on or before the date
which is forty-five (45) days after the date of execution hereof by Sublandlord
and Subtenant, then this Sublease shall automatically terminate and become null
and void, and neither Sublandlord nor Subtenant shall have any further
obligations or liability hereunder or to each other with respect to the
Premises, except for Sublandlord's obligation to refund to Subtenant the
security deposit and any rent paid by Subtenant attributable to the period after
the date of termination, subject to and in accordance with the terms hereof.
19. Examination. Submission of this instrument for examination or
signature by Subtenant does not constitute a reservation of or option for the
Premises or in any manner bind Sublandlord, and no lease, sublease or obligation
on Sublandlord shall arise until this instrument is signed and delivered by
Sublandlord and Subtenant and the consent of Landlord is obtained as described
in Section 18 above; provided, however, that the execution and delivery by
Subtenant of this Sublease to Sublandlord shall constitute an irrevocable offer
by Subtenant to sublease the Premises on the terms and conditions herein
contained, which offer may not be revoked unless Sublandlord fails to execute
this Sublease within thirty (30) days after the date of such delivery by
Subtenant.
20. Parking. Provided that Subtenant is not in default of any of its
obligations hereunder, during the term of this Sublease Subtenant shall have the
rights and privileges with respect to parking provided to Sublandlord under
Article 28 of the Prime Lease, subject to payment and performance by Subtenant
of the obligations of "Tenant" thereunder.
21. Sublease Improvements.
(a) Prior to the Commencement Date, Sublandlord and Subtenant shall
conduct a walkthrough of the Premises for the purpose of determining the damage,
if any, caused by Sublandlord as a result of Sublandlord's move-out from the
Premises. Sublandlord shall, at Sublandlord's expense: (i) clean the carpets
existing in the Premises as of the date hereof, (ii) provide touch-up paint to
the walls existing in the Premises on the date hereof, and (iii) repair any
damage to the Premises caused by Sublandlord's move-out from the Premises, all
to the extent reasonably necessary. The foregoing shall constitute Subtenant's
sole obligation with respect to clean up or improvements to the Premises.
(b) Subject to (i) Subtenant's compliance with the terms and conditions of
this Sublease and the Prime Lease, including, without limitation, Article 8 of
the Prime Lease, and (ii) to Prime Landlord's consent, Subtenant shall have the
right to perform the alterations described in Exhibit C attached hereto (the
"Subtenant's Improvements"), at Subtenant's sole cost and expense.
22. Miscellaneous.
(a) If any dispute should arise between Sublandlord and Subtenant with
respect to interpretation or performance of this Sublease, the nonprevailing
party shall pay the prevailing party's reasonable attorneys' fees and costs.
(b) This Sublease shall be governed by and interpreted under and construed
and enforced in accordance with the laws of the State of California.
10
IN WITNESS WHEREOF, Sublandlord and Subtenant have executed this Sublease
as of the date aforesaid.
SUBLANDLORD:
INFINIUM SOFTWARE, INC.
a Massachusetts corporation
/s/ Xxxx Xxxxx Xxxx
Executive Vice President
SUBTENANT:
QUALITY SYSTEMS, INC.
/s/ Xxx Xxxxxxxxx
President/CEO
Exhibits
"A" - Prime Lease
"B" - List of FF&E
"C" - Subtenant's Improvements
11
EXHIBIT A
PRIME LEASE
Ex. A - pg. 1 of 1
EXHIBIT B
LIST OF FF&E
Ex. B - pg. 1 of 1
EXHIBIT C
SUBTENANT'S IMPROVEMENTS
Ex. C - pg. 1 of 1
