Exhibit 10.5
GOLDEN GATE COMMERCIAL
LEASE AGREEMENT
THIS LEASE, made this 21st day of July, 1998 by and between GOLDEN GATE
COMMERCIAL COMPANY, a California Limited Partnership, hereinafter called
Landlord and EGAIN COMMUNICATIONS CORPORATION, a Delaware corporation,
hereinafter called Tenant.
WITNESSETH:
Landlord hereby leases to Tenant and Tenant hereby hires and takes from
Landlord those certain premises (the "Premises") outlined in red on Exhibit "A,"
attached hereto and incorporated herein by this reference thereto more
particularly described as follows:
A portion of that certain 17,840 square foot, one-story building located at
000 X. Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxx 00000, consisting of
approximately ten thousand seven hundred twenty (10,720) square feet. Said
Premises are more particularly shown within the area outlined in Red on
Exhibit "A" attached hereto. The entire parcel, of which the Premises are a
part, is shown within the area outlined in Green on Exhibit "A" attached
hereto. The Premises shall be improved as shown on Exhibit "B" to be
attached hereto, and is leased on an "as is" basis, in its present
condition, and in the configuration as shown in Red on Exhibit "B" to be
attached hereto.
The word "Premises" as used throughout this lease is hereby defined to
include the building and the non-exclusive use of landscaped areas, sidewalks,
parking lot, and driveways in front of or adjacent to the building, and the non-
exclusive use of the area directly underneath or over such sidewalks and
driveways. The gross leasable area of the building shall be measured from
outside of exterior walls to outside of exterior walls, and shall include any
atriums, covered entrances or egresses and covered loading areas.
Said letting and hiring is upon and subject to the terms, covenants and
conditions hereinafter set forth and Tenant covenants as a material part of the
consideration of this Lease to perform and observe each and all of said terms,
covenants and conditions. This Lease is made upon the conditions of such
performance and observance.
1. USE. Tenant shall use the Premises only in conformance with applicable
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governmental laws, regulations, rules and ordinances for the purpose of general
office, light manufacturing, research and development, and storage and other
uses necessary for Tenant to conduct Tenant's business, provided that such uses
shall be in accordance with all applicable governmental laws and ordinances, and
for no other purpose. Tenant shall not do or permit to be done in or about the
Premises nor bring or keep or permit to be brought or kept in or about the
Premises anything which is prohibited by or will in any way increase the
existing rate of (or otherwise affect) fire or any insurance covering the
Premises or any part thereof, or any of its contents, or will cause a
cancellation of any insurance covering the Premises or any part thereof, or any
of its contents. Tenant shall not do or permit to be done anything in, on or
about the Premises which will in any
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way obstruct or interfere with the rights of other tenants or occupants of
neighboring premises or injure or annoy them, or use or allow the Premises to be
used for any improper, immoral, unlawful or objectionable purpose, nor shall
Tenant cause, maintain or permit any nuisance in, on or about the Premises. No
sale by auction shall be permitted on the Premises. Tenant shall not place any
loads upon the floors, walls, or ceiling which endanger the structure, or place
any harmful fluids or other materials in the drainage system of the building, or
overload existing electrical or other mechanical systems. No waste materials or
refuse shall be dumped upon or permitted to remain upon any part of the Premises
including the outside of the building, except in trash containers placed inside
exterior enclosures designated by Landlord for that purpose or inside of the
building proper where designated by Landlord. No materials, supplies, equipment,
finished products or semi-finished products, raw materials or articles of any
nature shall be stored upon or permitted to remain outside the Premises. Tenant
shall not place anything or allow anything to be placed near the glass of any
window, door partition or wall which may appear unsightly from outside the
Premises. No loudspeaker or other device, system or apparatus which can be heard
outside the Premises shall be used in or at the Premises without the prior
written consent of Landlord. Tenant shall not commit or suffer to be committed
any waste in or upon the Premises. Tenant shall indemnify, defend and hold
Landlord harmless against any loss, expense, damage, reasonable attorneys' fees,
or liability arising out of failure of Tenant to comply with any applicable law.
Tenant shall comply with any covenant, condition, or restriction ("CC&R's")
affecting the Premises. The provisions of this paragraph are for the benefit of
Landlord only and shall not be construed to be for the benefit of any tenant or
occupant of the Premises.
2. TERM
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A. The term of this Lease shall be for a period of five (5) years and one
(1) month (unless sooner terminated as hereinafter provided), and shall commence
on the 1 st day of September, 1998 and end on the 30th day of September, 2003.
B. Possession of the Premises shall be deemed tendered and the term of the
Lease shall commence on September 1, 1998, or as otherwise agreed in writing.
C. It is agreed in the event said Lease commences on a date other than the
first day of the month the term of the Lease will be extended to account for the
number of days in the partial month. The Basic Rent during the resulting
partial month will be prorated (for the number of days in the partial month) at
the Basic Rent rate scheduled for the projected commencement date as shown in
Paragraph 4A.
3. POSSESSION. If Landlord, for any reason whatsoever, cannot deliver
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possession of said premises to Tenant at the commencement of the said term, as
hereinbefore specified, this Lease shall not be void or voidable; no obligation
of Tenant shall be affected thereby; nor shall Landlord or Landlord's agents be
liable to Tenant for any loss or damage resulting therefrom; but in that event
the commencement and termination dates of the Lease, and all other dates
affected thereby shall be revised to conform to the date of Landlord's delivery
of possession, as specified in Paragraph 2B, above. The above is, however,
subject to the provision that the period of delay of delivery of the Premises
shall not exceed sixty (60) days from the commencement
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date herein (except those delays caused by Acts of God, strikes, war, utilities,
governmental bodies, weather, unavailable materials, and delays beyond
Landlord's control shall be excluded in calculating such period) in which
instance Tenant, at its option, may, by written notice to Landlord, terminate
this Lease.
4. RENT
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A. Basic Rent. Tenant agrees to pay to Landlord at such place as Landlord
may designate without deduction, offset, prior notice, or demand, and Landlord
agrees to accept as Basic Rent for the leased Premises the total sum of ONE
MILLION SIX HUNDRED FOUR THOUSAND TWO HUNDRED FORTY-EIGHT DOLLARS
($1,604,248.00) in lawful money of the United States of America, payable as
follows:
Upon execution of this Lease Agreement, the sum of TWENTY-FOUR THOUSAND ONE
HUNDRED TWENTY DOLLARS ($24,120.00) shall be due, representing the rental for
the period September 1, 1998 through September 30, 1998;
On October 1, 1998, the sum of TWENTY-FOUR THOUSAND ONE HUNDRED TWENTY
DOLLARS ($24,120.00) shall be due, and a like sum due on the first day of each
month thereafter, through and including August 31, 1999;
On September 1, 1999, the sum of TWENTY-FIVE THOUSAND ONE HUNDRED NINETY-
TWO DOLLARS ($25,192.00) shall be due, and a like sum due on the first day of
each month thereafter, through and including August 31, 2000;
On September 1, 2000, the sum of TWENTY-SIX THOUSAND TWO HUNDRED SIXTY-
FOUR DOLLARS ($26,264.00) shall be due, and a like sum due on the first day of
each month thereafter, through and including August 31, 2001;
On September 1, 2001, the sum of TWENTY-SEVEN THOUSAND THREE HUNDRED
THIRTY-SIX DOLLARS ($27,336.00) shall be due, and a like sum due on the first
day of each month thereafter, through and including August 31, 2002; and
On September 1, 2002, the sum of TWENTY-EIGHT THOUSAND FOUR HUNDRED EIGHT
DOLLARS ($28,408.00) shall be due, and a like sum due on the first day of each
month thereafter, through and including September 30, 2003, or until the entire
aggregate sum of ONE MILLION SIX HUNDRED FOUR THOUSAND TWO HUNDRED FORTY-EIGHT
DOLLARS ($1,604,248.00) has been paid.
B. Time for Payment. Full monthly rent is due in advance on the first day
of each calendar month. In the event that the term of this Lease commences on a
date other than the first day of a calendar month, on the date of commencement
of the term hereof Tenant shall pay to Landlord as rent for the period from such
date of commencement to the first day of the next succeeding calendar month that
proportion of the monthly rent hereunder which the number of days between such
date of commencement and the first day of the next succeeding calendar month
bears to thirty (30). In the event that the term of this Lease for any reason
ends on a date other than the last day of a calendar month, on the first day of
the last calendar month of the term
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hereof Tenant shall pay to Landlord as rent for the period from said first day
of said last calendar month to and including the last day of the term hereof
that proportion of the monthly rent hereunder which the number of days between
said first day of said last calendar month and the last day of the term hereof
bears to thirty (30).
C. Late Charge. Notwithstanding any other provision of this Lease, if
Tenant is in default in the payment of rental as set forth in this Paragraph 4
when due, or any part thereof, Tenant agrees to pay Landlord, in addition to the
delinquent rental due, a late charge for each rental payment in default ten (10)
days. Said late charge shall equal ten percent (10%) of each rental payment so
in default.
D. Additional Rent. Beginning with the commencement date of the term of
this Lease, Tenant shall pay to Landlord or to Landlord's designated agent in
addition to the Basic Rent and as Additional Rent the following:
(a) All Taxes related to the Premises as set forth in Paragraph 9, and
(b) All insurance premiums relating to the Premises, as set forth in
Paragraph 12, and
(c) All charges, costs and expenses, which Tenant is required to pay
hereunder, together with all interest and penalties, costs and expenses
including reasonable attorneys' fees and legal expenses, that may accrue thereto
in the event of Tenant's failure to pay such amounts, and all damages,
reasonable costs and expenses which Landlord may incur by reason of default of
Tenant or failure on Tenant's part to comply with the terms of this Lease. In
the event of nonpayment by Tenant of Additional Rent, Landlord shall have all
the rights and remedies with respect thereto as Landlord has for nonpayment of
rent.
Unless otherwise provided in this Lease, the Additional Rent due hereunder
shall be paid to Landlord or Landlord's agent (i) within five days for taxes and
insurance and within thirty (30) days for all other Additional Rent items after
presentation of invoice from Landlord or Landlord's agent setting forth such
Additional Rent and/or (ii) at the option of Landlord, Tenant shall pay to
Landlord monthly, in advance, Tenant's prorata share of an amount estimated by
Landlord to be Landlord's approximate average monthly expenditure for such
Additional Rent items, which estimated amount shall be reconciled within 120
days of the end of each calendar year or more frequently if Landlord elects to
do so at Landlord's sole and absolute discretion as compared to Landlord's
actual expenditure for said Additional Rent items, with Tenant paying to
Landlord, upon demand, any amount of actual expenses expended by Landlord in
excess of said estimated amount, or Landlord crediting to Tenant (providing
Tenant is not in default in the performance of any of the terms, covenants and
conditions of this Lease) any amount of estimated payments made by Tenant in
excess of Landlord's actual expenditures for said Additional Rent items.
The respective obligations of Landlord and Tenant under this paragraph
shall survive the expiration or other termination of the term of this Lease, and
if the term hereof shall expire or shall otherwise terminate on a day other than
the last day of a calendar year, the actual Additional Rent incurred for the
calendar year in which the term hereof expires or otherwise terminates shall be
determined and settled on the basis of the statement of actual Additional Rent
for such calendar year and shall be prorated in the proportion which the number
of days in such calendar year preceding such expiration or termination bears to
365.
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E. Fixed Management Fee. Beginning with the Commencement Date of the Term
of this Lease, Tenant shall pay to Landlord, in addition to the Basic Rent and
Additional Rent, a fixed monthly management fee ("Management Fee") equal to 3%
of the Basic Rent due for each month during the Lease Term.
F. Place of Payment of Rent and Additional Rent. All Basic Rent hereunder
and all payments hereunder for Additional Rent shall be paid to Landlord at the
office of Landlord at 000 Xxxxx Xxx Xxxxxxx Xxxx, Xxxxx 0, Xxx Xxxxx, XX 00000
or to such other person or to such other place as Landlord may from time to time
designate in writing.
G. Security Deposit. Concurrently with Tenant's execution of this Lease,
Tenant shall deposit with Landlord the sum of FIFTY-SIX THOUSAND EIGHT HUNDRED
SIXTEEN ($56,816.00). Said sum shall be held by Landlord as a Security Deposit
for the faithful performance by Tenant of all of the terms, covenants, and
conditions of this Lease to be kept and performed by Tenant during the term
hereof. If Tenant defaults with respect to any provision of this Lease,
including, but not limited to, the provisions relating to the payment of rent
and any of the monetary sums due herewith, Landlord may (but shall not be
required to) use, apply or retain all or any part of this Security Deposit for
the payment of any other amount which Landlord may spend 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 said Deposit is so
used or applied, Tenant shall, within ten (10) days after written demand
therefor, deposit cash with Landlord in the 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 required to keep this
Security Deposit separate from its general funds, and Tenant shall not be
entitled to interest on such Deposit. If Tenant fully and faithfully performs
every provision of this Lease to be performed by it, the Security Deposit or any
balance thereof shall be returned to Tenant (or at Landlord's option, to the
last assignee of Tenant's interest hereunder) at the expiration of the Lease
term and after Tenant has vacated the Premises. In the event of termination of
Landlord's interest in this Lease, Landlord shall transfer said Deposit to
Landlord's successor in interest whereupon Tenant agrees to release Landlord
from liability for the return of such Deposit or the accounting therefor.
5. ACCEPTANCE AND SURRENDER OF PREMISES. By entry hereunder, and subject to
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the supplemental letter agreement between Landlord and Tenant dated July 21,
1998. Tenant accepts the Premises as being in good and sanitary order,
condition and repair and accepts the building and improvements included in the
Premises in their present condition and without representation or warranty by
Landlord as to the condition of such building or as to the use or occupancy
which may be made thereof. Any exceptions to the foregoing must be by written
agreement executed by Landlord and Tenant. Tenant agrees on the last day of the
Lease term, or on the sooner termination of this Lease, to surrender the
Premises promptly and peaceably to Landlord in good condition and repair (damage
by Acts of God, fire, normal wear and tear excepted), with all interior walls
painted, or cleaned so that they appear freshly painted, and repaired and
replaced, if damaged; all floors cleaned and waxed; all carpets cleaned and
shampooed; all broken, marred or nonconforming acoustical ceiling tiles
replaced; all windows washed; the air conditioning and heating systems serviced
by a reputable and licensed service
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firm and in good operating condition and repair; the plumbing and electrical
systems and lighting in good order and repair, including replacement of any
burned out or broken light bulbs or ballasts; the lawn and shrubs in good
condition including the replacement of any dead or damaged plantings; the
sidewalk, driveways and parking areas in good order, condition and repair;
together with all alterations, additions, and improvements which may have been
made in, to, or on the Premises (except moveable trade fixtures installed at the
expense of Tenant) except that Tenant shall ascertain from Landlord within
thirty (30) days before the end of the term of this Lease whether Landlord
desires to have the Premises or any part or parts thereof restored to their
condition and configuration as when the Premises were delivered to Tenant and if
Landlord shall so desire, then Tenant shall restore said Premises or such part
or parts thereof before the end of this Lease at Tenant's sole cost and expense.
Tenant, on or before the end of the term or sooner termination of this Lease,
shall remove all of Tenant's personal property and trade fixtures from the
Premises, and all property not so removed on or before the end of the term or
sooner termination of this Lease shall be deemed abandoned by Tenant and title
to same shall thereupon pass to Landlord without compensation to Tenant.
Landlord may, upon termination of this Lease, remove all moveable furniture and
equipment so abandoned by Tenant, at Tenant's sole cost, and repair any damage
caused by such removal at Tenant's sole cost. If the Premises be not surrendered
at the end of the term or sooner termination of this Lease, Tenant shall
indemnify Landlord against loss or liability resulting from the delay by Tenant
in so surrendering the Premises including, without limitation, any claims made
by any succeeding tenant founded on such delay. Nothing contained herein shall
be construed as an extension of the term hereof or as a consent of Landlord to
any holding over by Tenant. The voluntary or other surrender of this Lease or
the Premises by Tenant or a mutual cancellation of this Lease shall not work as
a merger, and, at the option of Landlord, shall either terminate all or any
existing subleases or subtenancies or operate as an assignment to Landlord of
all or any such subleases or subtenancies.
6. ALTERATIONS AND ADDITIONS. Tenant shall not make, or suffer to be made, any
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alteration or addition to the Premises, or any part thereof, without the written
consent of Landlord first had and obtained by Tenant (such consent not to be
unreasonably withheld), but at the cost of Tenant, and any addition to, or
alteration of, the Premises, except moveable furniture and trade fixtures, shall
at once become a part of the Premises and belong to Landlord. Landlord reserves
the right to approve all contractors and mechanics proposed by Tenant to make
such alterations and additions. Tenant shall retain title to all moveable
furniture and trade fixtures placed in the Premises. All heating, lighting,
electrical, air conditioning, floor to ceiling partitioning, drapery, carpeting,
and floor installations made by Tenant, together with all property that has
become an integral part of the Premises, shall not be deemed trade fixtures.
Tenant agrees that it will not proceed to make such alteration or additions,
without having obtained consent from Landlord to do so, and until five (5) days
from the receipt of such consent, in order that Landlord may post appropriate
notices to avoid any liability to contractors or material suppliers for payment
for Tenant's improvements. Tenants will at all times permit such notices to be
posted and to remain posted until the completion of work. Tenant shall, if
required by Landlord, secure at Tenant's own cost and expense, a completion and
lien indemnity bond, satisfactory to Landlord, for such work. Tenant further
covenants and agrees that any mechanic's lien filed against the Premises for
work claimed to have been done for, or materials
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claimed to have been furnished to Tenant, will be discharged by Tenant, by bond
or otherwise, within ten (10) days after the filing thereof, at the cost and
expense of Tenant. Any exceptions to the foregoing must be made in writing and
executed by both Landlord and Tenant.
7. TENANT MAINTENANCE. Tenant shall, at its sole cost and expense, keep and
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maintain the Premises (including appurtenances) and every part thereof in a high
standard of maintenance and repair, and in good and sanitary condition. Tenant's
maintenance and repair responsibilities herein referred to include, but are not
limited to, janitorization, plumbing systems within the non-common areas of the
Premises (such as water and drain lines, sinks), electrical systems within the
non-common areas of the Premises (such as outlets, lighting fixtures, lamps,
bulbs, tubes, ballasts), heating and air conditioning controls within the non-
common areas of the Premises (such as mixing boxes, thermostats, time clocks,
supply and return grills), all interior improvements within the premises
including but not limited to: wall coverings, window coverings, acoustical
ceilings, vinyl tile, carpeting, partitioning, doors (both interior and
exterior, including closing mechanisms, latches, locks), and all other interior
improvements of any nature whatsoever. Tenant agrees to provide carpet xxxxxxx
under all rolling chairs or to otherwise be responsible for wear and tear of the
carpet caused by such rolling chairs if such wear and tear exceeds that caused
by normal foot traffic in surrounding areas. Areas of excessive wear shall be
replaced at Tenant's sole expense upon Lease termination.
8. UTILITIES. Tenant shall pay promptly, as the same become due, all charges
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for water, gas, electricity, telephone, telex and other electronic communication
service, sewer service, waste pick-up and any other utilities, materials or
services furnished directly to or used by Tenant on or about the Premises during
the term of this Lease, including, without limitation, any temporary or
permanent utility surcharge or other extractions whether or not hereinafter
imposed. In the event the above charges apply to any other tenant(s) of Landlord
where there is common usage with other tenant(s), such charges shall be
allocated to the leased Premises by square footage or other equitable basis as
calculated and determined by Landlord.
Landlord shall not be liable for and Tenant shall not be entitled to any
abatement or reduction of rent by reason of any interruption or failure of
utility services to the Premises when such interruption or failure is caused by
accident, breakage, repair, strikes, lockouts, or other labor disturbances or
labor disputes of any nature, or by any other cause, similar or dissimilar,
beyond the reasonable control of Landlord.
9. TAXES
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A. As Additional Rent and in accordance with Paragraph 4D of this Lease,
Tenant shall pay to Landlord, or if Landlord so directs, directly to the Tax
Collector, all Real Property Taxes relating to the Premises. In the event the
Premises leased hereunder consist of only a portion of the entire tax parcel,
Tenant shall pay to Landlord Tenant's proportionate share of such real estate
taxes allocated to the leased Premises by square footage or other reasonable
basis as reasonably calculated and determined by Landlord. If the tax billing
pertains 100% to the leased Premises, and Landlord chooses to have Tenant pay
said real estate taxes directly to the Tax Collector, then in such event
Landlord shall provide Tenant with the tax and assessment bills
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and it shall be the responsibility of Tenant to pay, prior to delinquency, the
applicable real property taxes and assessments pertaining to the leased
Premises. The term "Real Property Taxes," as used herein, shall mean (i) all
taxes, assessments, levies and other charges of any kind or nature whatsoever,
general and special, foreseen and unforeseen (including all installments of
principal and interest required to pay any general or special assessments for
public improvements and any increases resulting from reassessments caused by any
change in ownership of the Premises) now or hereafter imposed by any
governmental or quasi-governmental authority or special district having the
direct or indirect power to tax or levy assessments, which are levied or
assessed against, or with respect to the value, occupancy or use of, all or any
portion of the Premises (as now constructed or as may at any time hereafter be
constructed, altered, or otherwise changed) or Landlord's interest therein; any
improvements located within the Premises (regardless of ownership); the
fixtures, equipment and other property of Landlord, real or personal, that are
an integral part of and located in the Premises; or parking areas, public
utilities, or energy within the Premises; (ii) all charges, levies or fees
imposed by reason of environmental regulation or other governmental control of
the Premises; and (iii) all costs and fees (including reasonable attorneys'
fees) incurred by Landlord in reasonably contesting any Real Property Tax and in
negotiating with public authorities as to any Real Property Tax. If at any time
during the term of this Lease the taxation or assessment of the Premises
prevailing as of the commencement date of this Lease shall be altered so that in
lieu of or in addition to any Real Property Tax described above there shall be
levied, assessed or imposed (whether by reason of a change in the method of
taxation or assessment, creation of a new tax or charge, or any other cause) an
alternate or additional tax or charge (i) on the value, use or occupancy of the
Premises or Landlord's interest therein or (ii) on or measured by the gross
receipts, income or rentals from the Premises, on Landlord's business of leasing
the Premises, or computed in any manner with respect to the operation of the
Premises, then any such tax or charge, however designated, shall be included
within the meaning of the term "Real Property Taxes" for purposes of this Lease.
If any Real Property Tax is based upon property or rents unrelated to the
Premises, then only that part of such Real Property Tax that is fairly allocable
to the Premises shall be included within the meaning of the term "Real Property
Taxes." Notwithstanding the foregoing, the term "Real Property Taxes" shall not
include estate, inheritance, gift or franchise taxes of Landlord or the federal
or state net income tax imposed on Landlord's income from all sources.
B. Taxes on Tenant's Property. Tenant shall be liable for and shall pay
ten days before delinquency, 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 is increased by the
inclusion therein of a value placed upon such personal property or trade
fixtures of Tenant and if Landlord, after written notice to Tenant, pays the
taxes based on such increased assessment, which Landlord shall have the right to
do regardless of the validity thereof, but only under proper protest if
requested by Tenant, Tenant shall upon demand, as the case may be, repay to
Landlord the taxes so levied against Landlord, or the proportion of such taxes
resulting from such increase in the assessment; provided that in any such event
Tenant shall have the right, in the name of Landlord with Landlord's full
cooperation, to bring suit in any court of competent jurisdiction to recover the
amount of such taxes so paid under protest, and any amount so recovered shall
belong to Tenant.
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10. LIABILITY INSURANCE. Tenant, at Tenant's expense, agrees to keep in force
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during the term of this Lease a policy of commercial general liability insurance
with combined single limit coverage of not less than Two Million Dollars
($2,000,000) per occurrence for bodily injury and property damage occurring in,
on or about the Premises, including parking and landscaped areas. Such insurance
shall be primary and noncontributory as respects any insurance carried by
Landlord. The policy or policies effecting such insurance shall name Landlord as
additional insureds, and shall insure any liability of Landlord, contingent or
otherwise, as respects acts or omissions of Tenant, its agents, employees or
invitees or otherwise by any conduct or transactions of any of said persons in
or about or concerning the Premises, including any failure of Tenant to observe
or perform any of its obligations hereunder; shall be issued by an insurance
company admitted to transact business in the State of California; and shall
provide that the insurance effected thereby shall not be canceled, except upon
thirty (30) days' prior written notice to Landlord. A Certificate of Insurance
of said policy shall be delivered to Landlord within ten (10) days after
Tenant's occupancy of the Premises. If, during the term of this Lease, in the
considered and good faith opinion of Landlord's Lender, insurance advisor, or
counsel, the amount of insurance described in this Paragraph 10 is not adequate,
Tenant agrees to increase said coverage to such reasonable amount as Landlord's
Lender, insurance advisor, or counsel shall deem adequate.
11. TENANT'S PERSONAL PROPERTY INSURANCE AND XXXXXXX'X COMPENSATION INSURANCE.
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Tenant shall maintain a policy or policies of fire and property damage insurance
in "all risk" form with a sprinkler leakage endorsement insuring the personal
property, inventory, trade fixtures, and leasehold improvements within the
leased Premises for the full replacement value thereof. The proceeds from any of
such policies shall be used for the repair or replacement of such items so
insured.
Tenant shall also maintain a policy or policies of xxxxxxx'x compensation
insurance and any other employee benefit insurance sufficient to comply with all
laws.
Certificates of Insurance with respect to all policies required by this
Paragraph 11 shall be delivered to Landlord within ten (10) days after Tenant's
occupancy of the Premises.
12. PROPERTY INSURANCE. Landlord shall purchase and keep in force, and as
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Additional Rent and in accordance with Paragraph 4D of this Lease, Tenant shall
pay to Landlord (or Landlord's agent if so directed by Landlord) Tenant's
proportionate share (allocated to the leased Premises by square footage or other
equitable basis as calculated and determined by Landlord) of the deductibles on
insurance claims and the cost of, policy or policies of insurance covering loss
or damage to the Premises (excluding routine maintenance and repairs and
incidental damage or destruction caused by accidents or vandalism for which
Tenant is responsible under Paragraph 7) in the amount of the full replacement
value thereof, providing protection against those perils included within the
classification of "all risks" insurance and flood and/or earthquake insurance,
if available, plus a policy of rental income insurance in the amount of one
hundred (100%) percent of twelve (12) months Basic Rent, plus sums paid as
Additional Rent. If such insurance cost is increased due to Tenant's use of the
Premises, Tenant agrees to pay to Landlord the full cost of such increase.
Tenant shall have no interest in nor any right to the proceeds of any insurance
procured by Landlord for the Premises.
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Landlord and Tenant do each hereby respectively release the other, to the
extent of insurance coverage of the releasing party, from any liability for loss
or damage caused by fire or any of the extended coverage casualties included in
the releasing party's insurance policies, irrespective of the cause of such fire
or casualty; provided, however, that if the insurance policy of either releasing
party prohibits such waiver, then this waiver shall not take effect until
consent to such waiver is obtained. If such waiver is so prohibited, the
insured party affected shall promptly notify the other party thereof.
13. INDEMNIFICATION. Landlord shall not be liable to Tenant and Tenant hereby
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waives all claims against Landlord for any injury to or death of any person or
damage to or destruction of property in or about the Premises by or from any
cause whatsoever, including, without limitation, gas, fire, oil, electricity or
leakage of any character from the roof, walls, basement or other portion of the
Premises but excluding, however, the willful misconduct or negligence of
Landlord, its agents, servants, employees, invitees, or contractors of which
negligence Landlord has knowledge and reasonable time to correct. Except as to
injury to persons or damage to property to the extent arising from the willful
misconduct or the negligence of Landlord, its agents, servants, employees,
invitees, or contractors, Tenant shall hold Landlord harmless from and defend
Landlord against any and all expenses, including reasonable attorneys' fees, in
connection therewith, arising out of any injury to or death of any person or
damage to or destruction of property occurring in, on or about the Premises, or
any part thereof, from any cause whatsoever.
14. COMPLIANCE. Tenant, at its sole cost and expense, shall promptly comply
----------
with all laws, statutes, ordinances and governmental rules, regulations or
requirements now or hereafter in effect; with the requirements of any board of
fire underwriters or other similar body now or hereafter consulted; and with any
direction or occupancy certificate issued pursuant to law by any public officer;
provided, however, that no such failure shall be deemed a breach of the
provisions if Tenant, immediately upon notification, commences to remedy or
rectify said failure. The judgment of any court of competent jurisdiction or the
admission of Tenant in any action against Tenant, whether Landlord be a party
thereto or not, that Tenant has violated any such law, statute, ordinance or
governmental rule, regulation, requirement, direction or provision, shall be
conclusive of that fact as between Landlord and Tenant. Tenant shall, at its
sole cost and expense, comply with any and all requirements pertaining to said
Premises, of any insurance organization or company, necessary for the
maintenance of reasonable fire and public liability insurance covering
requirements pertaining to said Premises, of any insurance organization or
company, necessary for the maintenance of reasonable fire and public liability
insurance covering the Premises.
15. LIENS. Tenant shall keep the Premises free from any liens arising out of
-----
any work performed, materials furnished or obligation incurred by Tenant. In
the event that Tenant shall not, within ten (10) days following the imposition
of such lien, cause the same to be released of record, Landlord shall have, in
addition to all other remedies provided herein and by law, the right, but no
obligation, to cause the same to be released by such means as it shall deem
proper, including payment of the claim giving rise to such lien. All sums paid
by Landlord for such
Page 10 of 32
purpose, and all expenses incurred by it in connection therewith, shall be
payable to Landlord by Tenant on demand with interest at the prime rate of
interest as quoted by the Bank of America.
16. ASSIGNMENT AND SUBLETTING. Tenant shall not assign, transfer, or
-------------------------
hypothecate the leasehold estate under this Lease, or any interest therein, and
shall not sublet the Premises, or any part thereof, or any right or privilege
appurtenant thereto, or suffer any other person or entity to occupy or use the
Premises, or any portion thereof, without, in each case, the prior written
consent of Landlord which consent will not be unreasonably withheld. As a
condition for granting this consent to any assignment, transfer, or subletting,
Landlord shall require Tenant to pay to Landlord, as Additional Rent, all rents
and/or additional consideration due Tenant from its assignees, transferees, or
subtenants (less any third party leasing commission) in excess of the Rent
payable by Tenant to Landlord hereunder for the assigned, transferred and/or
subleased space. Tenant shall, by thirty (30) days written notice, advise
Landlord of its intent to assign or transfer Tenant's interest in the Lease or
sublet the Premises or any portion thereof for any part of the term hereof.
Within thirty (30) days after receipt of said written notice, Landlord may, in
its sole discretion, elect to terminate this Lease as to the portion of the
Premises described in Tenant's notice on the date specified in Tenant's notice
by giving written notice of such election to terminate. If no such notice to
terminate is given to Tenant within said thirty (30) day period, Tenant shall
proceed to locate an acceptable sublessee, assignee, or other transferee for
presentment to Landlord for Landlord's approval, all in accordance with the
terms, covenants, and conditions of this Paragraph 16. If Tenant intends to
sublet the entire Premises and Landlord elects to terminate this Lease, this
Lease shall be terminated on the date specified in Tenant's notice. If, however,
this Lease shall terminate pursuant to the foregoing with respect to less than
all the Premises, the rent, as defined and reserved hereinabove shall be
adjusted on a pro rata basis to the number of square feet retained by Tenant,
and this Lease as so amended shall continue in full force and effect. In the
event Tenant is allowed to assign, transfer or sublet the whole or any part of
the Premises, with the prior written consent of Landlord, no assignee,
transferee or subtenant shall assign or transfer this Lease, either in whole or
in part, or sublet the whole or any part of the Premises, without also having
obtained the prior written consent of Landlord. A consent of Landlord to one
assignment, transfer, hypothecation, subletting, occupation or use by any other
person shall not release Tenant from any of Tenant's obligations hereunder or be
deemed to be a consent to any subsequent similar or dissimilar assignment,
transfer, hypothecation, subletting, occupation or use by any other person. Any
such assignment, transfer, hypothecation, subletting, occupation or use without
such consent shall be void and shall constitute a breach of this Lease by Tenant
and shall, at the option of Landlord exercised by written notice to Tenant,
terminate this Lease. The leasehold estate under this Lease shall not, nor shall
any interest therein, be assignable for any purpose by operation of law without
the written consent of Landlord. As a condition to its consent, Landlord shall
require Tenant to pay all expenses in connection with the assignment, and
Landlord shall require Tenant's assignee or transferee (or other assignees or
transferees) to assume in writing all of the obligations under this Lease and
for Tenant to remain liable to Landlord under the Lease. Notwithstanding the
above, in no event will Landlord consent to a sub-sublease.
17. SUBORDINATION AND MORTGAGES. In the event Landlord's title or leasehold
---------------------------
interest is now or hereafter encumbered by a deed of trust, upon the interest of
Landlord in the
Page 11 of 32
land and buildings in which the demised Premises are located, to secure a loan
from a lender (hereinafter referred to as "Lender") to Landlord, Tenant shall,
at the request of Landlord or Lender, execute in writing an agreement
subordinating its rights under this Lease to the lien of such deed of trust, or,
if so requested, agreeing that the lien of Lender's deed of trust shall be or
remain subject and subordinate to the rights of Tenant under this Lease.
Notwithstanding any such subordination, Tenant's possession under this Lease
shall not be disturbed if Tenant is not in default and so long as Tenant shall
pay all rent and observe and perform all of the provisions set forth in this
Lease.
18. ENTRY BY LANDLORD. Landlord reserves, and shall at all reasonable times
-----------------
after at least 24 hours notice (except in emergencies) have, the right to enter
the Premises to inspect them; to perform any services to be provided by Landlord
hereunder; to make repairs or provide any services to a contiguous tenant(s); to
submit the Premises to prospective purchasers, mortgagors, or tenants; to post
notices of nonresponsibility; and to alter, improve or repair the Premises or
other parts of the building, all without abatement of rent, and may erect
scaffolding and other necessary structures in or through the Premises where
reasonably required by the character of the work to be performed; provided,
however that the business of Tenant shall be interfered with to the least extent
that is reasonably practical. Any entry to the Premises by Landlord for the
purposes provided for herein shall not under any circumstances be construed or
deemed to be a forcible or unlawful entry into or a detainer of the Premises or
an eviction, actual or constructive, of Tenant from the Premises or any portion
thereof.
19. BANKRUPTCY AND DEFAULT. The commencement of a bankruptcy action or
----------------------
liquidation action or reorganization action or insolvency action or an
assignment of or by Tenant for the benefit of creditors, or any similar action
undertaken by Tenant, or the insolvency of Tenant, shall, at Landlord's option,
constitute a breach of this Lease by Tenant. If the trustee or receiver
appointed to serve during a bankruptcy, liquidation, reorganization, insolvency
or similar action elects to reject Tenant's unexpired Lease, the trustee or
receiver shall notify Landlord in writing of its election within thirty (30)
days after an order for relief in a liquidation action or within thirty (30)
days after the commencement of any action.
Within thirty (30) days after court approval of the assumption of this
Lease, the trustee or receiver shall cure (or provide adequate assurance to the
reasonable satisfaction of Landlord that the trustee or receiver shall cure) any
and all previous defaults under the unexpired Lease and shall compensate
Landlord for all actual pecuniary loss and shall provide adequate assurance of
future performance under said Lease to the reasonable satisfaction of Landlord.
Adequate assurance of future performance, as used herein, includes, but shall
not be limited to: (i) assurance of source and payment of rent, and other
consideration due under this Lease; (ii) assurance that the assumption or
assignment of this Lease will not breach substantially any provision, such as
radius, location, use, or exclusivity provision, in any agreement relating to
the above described Premises.
Nothing contained in this section shall affect the existing right of
Landlord to refuse to accept an assignment upon commencement of or in connection
with a bankruptcy, liquidation, reorganization or insolvency action or an
assignment of Tenant for the benefit of creditors or other similar act. Nothing
contained in this Lease shall be construed as giving or granting or creating an
equity in the demised Premises to Tenant. In no event shall the leasehold
estate
Page 12 of 32
under this Lease, or any interest therein, be assigned by voluntary or
involuntary bankruptcy proceeding without the prior written consent of Landlord.
In no event shall this Lease or any rights or privileges hereunder be an asset
of Tenant under any bankruptcy, insolvency or reorganization proceedings.
The failure to perform or honor any covenant, condition or representation
made under this Lease shall constitute a default hereunder by Tenant upon
expiration of the appropriate grace period hereinafter provided. Tenant shall
have a period of five (5) days from the date of written notice from Landlord
within which to cure any default in the payment of rental or adjustment thereto.
Tenant shall have a period of thirty (30) days from the date of written notice
from Landlord within which to cure any other default under this Lease. Upon an
uncured default of this Lease by Tenant, Landlord shall have the following
rights and remedies in addition to any other rights or remedies available to
landlord at law or in equity:
(a) The rights and remedies provided for by California Civil Code Section
1951.2, including but not limited to, recovery of the worth at the same 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 rental loss for the same period that
Tenant proves could be reasonably avoided, as computed pursuant to subsection
(b) of said Section 1951.2. Any proof by Tenant under subparagraphs (2) and (3)
of Section 1951.2 of the California Civil Code of the amount of rental loss that
could be reasonably avoided shall be made in the following manner: Landlord and
Tenant shall each select a licensed real estate broker in the business of
renting property of the same type and use as the Premises and in the same
geographic vicinity. Such two real estate brokers shall select a third licensed
real estate broker, and the three licensed real estate brokers so selected shall
determine the amount of the rental loss that could be reasonably avoided from
the balance of the term of this Lease after the time of award. The decision of
the majority of said licensed real estate brokers shall be final and binding
upon the parties hereto.
(b) The rights and remedies provided by California Civil Code Section
which allows Landlord to continue the Lease in effect and to enforce all of its
rights and remedies under this Lease, including the right to recover rent as it
becomes 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 .
(c) The right to terminate this Lease by giving notice to Tenant in
accordance with applicable law.
(d) To the extent permitted by law the right and power to enter the
Premises and remove therefrom all persons and property, to store such property
in a public warehouse or elsewhere at the cost of and for the account of Tenant,
and to sell such property and apply such proceeds therefrom pursuant to
applicable California law. Landlord may from time to time sublet the Premises
or any part thereof for such term or terms (which may extend beyond the term of
this Lease) and at such rent and such other terms as Landlord in its reasonable
sole discretion may deem advisable, with the right to make alterations and
repairs to the Premises. Upon each subletting, (i) Tenant shall be immediately
liable to pay Landlord, in addition to indebtedness other than rent due
hereunder, the reasonable cost of such subletting, including, but not limited
to, reasonable attorneys' fees, and any real estate commissions actually paid,
and the cost of such reasonable alterations and repairs incurred by Landlord and
the amount, if any, by which the rent hereunder for the period of such
subletting (to the extent such period does not
Page 13 of 32
exceed the term hereof) exceeds the amount to be paid as rent for the Premises
for such period or (ii) at the option of Landlord, rents received from such
subletting shall be applied first to payment of indebtedness other than rent due
hereunder from Tenant to Landlord; second, to the payment of any costs of such
subletting and of such alterations and repairs; third to payment of rent due and
unpaid hereunder; and the residue, if any, shall be held by Landlord and applied
in payment of future rent as the same becomes due hereunder. If Tenant has been
credited with any rent to be received by such subletting under option (i) and
such rent shall not be promptly paid to Landlord by the subtenant(s), or if such
rentals received from such subletting under option (ii) during any month be less
than that to be paid during that month by Tenant hereunder, Tenant shall pay any
such deficiency to Landlord. Such deficiency shall be calculated and paid
monthly. No taking possession of the Premises by Landlord shall be construed as
an election on its part to terminate this Lease unless a written notice of such
intention be given to Tenant. Notwithstanding any such subletting without
termination, Landlord may at any time hereafter elect to terminate this Lease
for such previous breach.
(e) The right to have a receiver appointed for Tenant upon application by
Landlord, to take possession of the Premises and to apply any rental collected
from the Premises and to exercise all other rights and remedies granted to
Landlord pursuant to subparagraph d. above.
20. ABANDONMENT. Tenant shall not vacate or abandon the Premises at any time
-----------
during the term of this Lease, and if Tenant shall abandon, vacate or surrender
said Premises, or be dispossessed by the process of law, or otherwise, any
personal property belonging to Tenant and left on the Premises shall be deemed
to be abandoned, at the option of Landlord, except such property as may be
mortgaged to Landlord.
21. DESTRUCTION. In the event the Premises are destroyed in whole or in part
-----------
from any cause, except for routine maintenance and repairs and incidental damage
and destruction caused from vandalism and accidents for which Tenant is
responsible under Xxxxxxxxx 0, Xxxxxxxx may, at its option:
(a) Rebuild or restore the Premises to their condition prior to the damage
or destruction, or
(b) Terminate this Lease (providing that the Premises is damaged to the
extent of 33-1/3% of the replacement cost).
If Landlord does not give Tenant notice in writing within thirty (30) days
from the destruction of the Premises of its election to either rebuild and
restore them, or to terminate this Lease, Landlord shall be deemed to have
elected to rebuild or restore them, in which event Landlord agrees, at its
expense except for any deductible, which is the responsibility of Tenant,
promptly to rebuild or restore the Premises to their condition prior to the
damage or destruction. Tenant shall be entitled to a reduction in rent
following such destruction and while such repair is being made in the proportion
that the area of the Premises rendered untenantable by such damage bears to the
total area of the Premises. If Landlord initially estimates that the rebuilding
or restoration will exceed one hundred eighty (180) days or ninety (90) days if
occurring during the last twelve (12) months of the Lease term, or if Landlord
does not complete the rebuilding or restoration within one hundred eighty (180)
days following the date of destruction or ninety (90) days during the last
twelve (12) months of the Lease term, (such period of time to be extended for
delays caused by the fault or neglect of Tenant or because of Acts of God, acts
of public
Page 14 of 32
agencies, labor disputes, strikes, fires, freight embargoes, rainy or stormy
weather, inability to obtain materials, supplies or fuels, acts of contractors
or subcontractors, or delay of the contractors or subcontractors due to such
causes or other contingencies beyond the control of Landlord), then Tenant shall
have the right to terminate this Lease by giving fifteen (15) days prior written
notice to Landlord. Notwithstanding anything herein to the contrary, Landlord's
obligation to rebuild or restore shall be limited to the building and interior
improvements constructed by Landlord as they existed as of the commencement date
of the Lease and shall not include restoration of Tenant's trade fixtures,
equipment, merchandise, or any improvements, alterations, or additions made by
Tenant to the Premises, which Tenant shall forthwith replace or fully repair at
Tenant's sole cost and expense provided this Lease is not canceled according to
the provisions above.
Unless this Lease is terminated pursuant to the foregoing provisions, this
Lease shall remain in full force and effect. Tenant hereby expressly waives the
provisions of Section 1932, Subdivision 2, in Section 1933, Subdivision 4 of the
California Civil Code.
In the event that the building in which the Premises are situated is
damaged or destroyed to the extent of not less than 33-1/3% of the replacement
cost thereof, Landlord may elect to terminate this Lease. Notwithstanding
anything to the contrary herein, Landlord may terminate this Lease in the event
of an uninsured event or if insurance proceeds are insufficient to cover one
hundred percent of the rebuilding costs net of the deductible.
22. EMINENT DOMAIN. If all or any part of the Premises shall be taken by any
--------------
public or quasi-public authority under the power of eminent domain or conveyance
in lieu thereof, this Lease shall terminate as to any portion of the Premises so
taken or conveyed on the date when title vests in the condemnor, and Landlord
shall be entitled to any and all payment, income, rent, award, or any interest
therein whatsoever which may be paid or made in connection with such taking or
conveyance, and Tenant shall have no claim against Landlord or otherwise for the
value of any unexpired term of this Lease. Notwithstanding the foregoing
paragraph, any compensation specifically awarded Tenant for loss of business,
Tenant's personal property, moving cost or loss of goodwill, shall be and remain
the property of Tenant.
If any action or proceeding is commenced for such taking of the Premises or
any part thereof, or if Landlord is advised in writing by any entity or body
having the right or power of condemnation of its intention to condemn the
premises or any portion thereof, then Landlord shall have the right to terminate
this Lease by giving Tenant written notice thereof within sixty (60) days of the
date of receipt of said written advice, or commencement of said action or
proceeding, or taking conveyance, which termination shall take place as of the
first to occur of the last day of the calendar month next following the month in
which such notice is given or the date on which title to the Premises shall vest
in the condemnor.
In the event of such a partial taking or conveyance of the Premises, if the
portion of the Premises taken or conveyed is so substantial that the Tenant can
no longer reasonably conduct its business, Tenant shall have the privilege of
terminating this Lease within sixty (60) days from the date of such taking or
conveyance, upon written notice to Landlord of its intention so to do, and upon
giving of such notice this Lease shall terminate on the last day of the calendar
month next following the month in which such notice is given, upon payment by
Tenant of the rent from the date of such taking or conveyance to the date of
termination.
Page 15 of 32
If a portion of the Premises be taken by condemnation or conveyance in lieu
thereof and neither Landlord nor Tenant shall terminate this Lease as provided
herein, this Lease shall continue in full force and effect as to the part of the
Premises not so taken or conveyed, and the rent herein shall be apportioned as
of the date of such taking or conveyance so that thereafter the rent to be paid
by Tenant shall be in the ratio that the area of the portion of the Premises not
so taken or conveyed bears to the total area of the Premises prior to such
taking.
23. SALE OR CONVEYANCE BY LANDLORD. In the event of a sale or conveyance of
------------------------------
the Premises or any interest therein, by any owner of the reversion then
constituting Landlord, the transferor shall thereby be released from any further
liability upon any of the terms, covenants or conditions (express or implied)
herein contained in favor of Tenant for any claims arising after such sale or
conveyance, and in such event, insofar as such transfer is concerned, Tenant
agrees to look solely to the responsibility of the successor in interest of such
transferor in and to the Premises and this Lease for any claims arising after
such transfer. This Lease shall not be affected by any such sale or conveyance,
and Tenant agrees to attorn to the successor in interest of such transferor.
24. ATTORNMENT TO LENDER OR THIRD PARTY. In the event the interest of Landlord
-----------------------------------
in the Premises (whether such interest of Landlord is a fee title interest or a
leasehold interest) is encumbered by deed of trust, and such interest is
acquired by the lender or any third party through judicial foreclosure or by
exercise of a power of sale at private trustee's foreclosure sale, Tenant hereby
agrees to attorn to the purchaser at any such foreclosure sale and to recognize
such purchaser as the Landlord under this Lease. In the event the lien of the
deed of trust securing the loan from a Lender to Landlord is prior and paramount
to the Lease, this Lease shall nonetheless continue in full force and effect for
the remainder of the unexpired term hereof, at the same rental herein reserved
and upon all the other terms, conditions and covenants herein contained.
25. HOLDING OVER. Any holding over by Tenant after expiration or other
------------
termination of the term of this Lease with the written consent of Landlord
delivered to Tenant shall not constitute a renewal or extension of the Lease or
give Tenant any rights in or to the leased Premises except as expressly provided
in this Lease. Any holding over after the expiration or other termination of the
term of this Lease, with the consent of Landlord, shall be construed to be a
tenancy from month to month, on the same terms and conditions herein specified
insofar as applicable except that the monthly Basic Rent shall be increased to
an amount equal to one hundred fifty (150%) percent of the monthly Basic Rent
required during the last month of the Lease term.
26. CERTIFICATE OF ESTOPPEL. Tenant shall at any time upon not less than ten
-----------------------
(10) days prior written notice from Landlord execute, acknowledge and deliver to
Landlord a statement in writing (i) certifying that this Lease is unmodified and
in full force and effect (or, if modified, stating the nature of such
modification and certifying that this Lease, as so modified, is in full force
and effect) and the date to which the rent and other charges are paid in
advance, if any, and (ii) acknowledging that there are not, to Tenant's
knowledge, any uncured defaults on the part of Landlord hereunder, or specifying
such defaults, if any, are claimed. Any such
Page 16 of 32
statement may be conclusively relied upon by any prospective purchaser or
encumbrancer of the Premises. Tenant's failure to deliver such statement within
such time shall be conclusive upon Tenant that this Lease is in full force and
effect, without modification except as may be represented by landlord; that
there are no uncured defaults in Landlord's performance, and that not more than
one month's rent has been paid in advance.
27. CONSTRUCTION CHANGES. It is understood that the description of the
--------------------
Premises and the location of ductwork, plumbing and other facilities therein are
subject to such minor changes as Landlord or Landlord's architect determines to
be desirable in the course of construction of the Premises, and no such changes
shall affect this Lease or entitle Tenant to any reduction of rent hereunder or
result in any liability of Landlord to Tenant. Landlord does not guarantee the
accuracy of any drawings supplied to Tenant and verification of the accuracy of
such drawings rests with Tenant.
28. RIGHT OF LANDLORD TO PERFORM. All terms, covenants and conditions of this
----------------------------
Lease to be performed or observed by Tenant shall be performed or observed by
Tenant at Tenant's sole cost and expense and without any reduction of rent. If
Tenant shall fail to pay any sum of money, or other rent, required to be paid by
it hereunder and such failure shall continue for five (5) days after written
notice thereof by Landlord, or shall fail to perform any other term or covenant
hereunder on its part to be performed, and such failure shall continue for
thirty (30) days after written notice thereof by landlord, Landlord, without
waiving or releasing Tenant from any obligation of Tenant hereunder, may, but
shall not be obliged to, make any such payment or perform any such other term or
covenant on Tenant's part to be performed. All sums so paid by Landlord and all
necessary costs of such performance by Landlord together with interest thereon
at the rate of the prime rate of interest per annum as quoted by the Bank of
America from the date of such payment on performance by Landlord, shall be paid
(and Tenant covenants to make such payment) to Landlord on demand by Landlord,
and Landlord shall have (in addition to any other right or remedy of Landlord)
the same rights and remedies in the event of nonpayment by Tenant as in the case
of failure by Tenant in the payment of rent hereunder.
29. ATTORNEYS' FEES
---------------
A. In the event that either Landlord or Tenant should bring suit for the
possession of the Premises, for the recovery of any sum due under this Lease, or
because of the breach of any provision of this Lease, or for any other relief
against the other party hereunder, then all costs and expenses, including
reasonable attorneys' fees, incurred by the prevailing party therein shall be
paid by the other party, which obligation on the part of the other party shall
be deemed to have accrued on the date of the commencement of such action and
shall be enforceable whether or not the action is prosecuted to judgment.
B. Except as otherwise provided in this Lease, should Landlord be 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 costs and
expenses incurred in such suit, including a reasonable attorney's fee.
Page 17 of 32
30. WAIVER. The waiver by either party of the other party's failure to perform
------
or observe any term, covenant or condition herein contained to be performed or
observed by such waiving party shall not be deemed to be a waiver of such term,
covenant or condition or of any subsequent failure of the party failing to
perform or observe the same or any other such term, covenant or condition
therein contained, and no custom or practice which may develop between the
parties hereto during the term hereof shall be deemed a waiver of, or in any way
affect, the right of either party to insist upon performance and observance by
the other party in strict accordance with the terms hereof.
31. NOTICES. All notices, demands, requests, advices or designations which may
-------
be or are required to be given by either party to the other hereunder shall be
in writing. All notices, demands, requests, advices or designations by Landlord
to Tenant shall be sufficiently given, made or delivered if personally served on
Tenant by leaving the same at the Premises or if sent by overnight mail courier
service, postage prepaid, addressed to Tenant, attention: C.F.O., at the
Premises. All notices, demands, requests, advices or designations by Tenant to
Landlord shall be sent by United States certified or registered mail, postage
prepaid, addressed to Landlord at its offices at 000 Xxxxx Xxx Xxxxxxx Xxxx,
Xxxxx 0, Xxx Xxxxx, XX 00000. Each notice, request, demand advice or designation
referred to in this paragraph shall be deemed received on the date of the
personal service, overnight mail or courier service, thereof in the manner
herein provided, as the case may be.
32. EXAMINATION OF LEASE. Submission of this instrument for examination or
--------------------
signature by Tenant does not constitute a reservation of or option for a lease,
and this instrument is not effective as a lease or otherwise until its execution
and delivery by both Landlord and Tenant.
33. DEFAULT OF LANDLORD. Landlord shall not be in default unless Landlord
-------------------
fails to perform obligations required of Landlord within a reasonable time, but
in no event earlier than thirty (30) days after written notice by Tenant to
Landlord and to the holder of any first mortgage or deed of trust covering the
Premises whose name and address shall have heretofore been furnished to Tenant
in writing, specifying wherein Landlord has failed to perform such obligations;
provided, however, that if the nature of Landlord's obligations is such that
more than thirty (30) days are required for performance, then Landlord shall not
be in default if Landlord commences performance within such thirty (30) day
period and thereafter diligently prosecutes the same to completion.
34. CORPORATE AUTHORITY. If Tenant is a corporation (or a partnership), each
-------------------
individual executing this Lease on behalf of said corporation (or partnership)
represents and warrants that he is duly authorized to execute and deliver this
Lease on behalf of said corporation (or partnership) in accordance with the by-
laws of said corporation (or partnership in accordance with the partnership
agreement) and that this Lease is binding upon said corporation (or partnership)
in accordance with its terms. If Tenant is a corporation, Tenant shall, within
thirty (30) days after execution of this Lease, deliver to Landlord a certified
copy of the resolution of the Board of Directors of said corporation authorizing
or ratifying the execution of this Lease.
Page 18 of 32
35. BASIC RENT ADJUSTMENT
---------------------
A. Consumer Price Index. It is understood that on each and every
anniversary of the date Tenant takes possession, the Basic Rent provided for in
Paragraph 4A of the Lease shall be adjusted in accordance with the following
formula based on the Consumer Price Index ("CPI") for All Urban Consumers,
subgroup "All Items," San Francisco-Oakland-San Jose, California Metropolitan
Area (1982-84 - 100) published by the Bureau of Labor Statistics, U.S.
Department of Labor (the "Index") published nearest the date Tenant takes
possession of the Premises (the "Beginning Index") and the Index which is
published nearest but prior to each and every anniversary of the date on which
Tenant takes possession of the Premises (the "Adjustment Index"). The CPI-
adjusted Basic Rent shall be calculated by multiplying the Basic Rent provided
for in Paragraph 4A of the Lease by a fraction, the numerator of which is the
Adjustment Index and the denominator of which is the Beginning Index. In no
event, however, shall the adjusted Basic Rent decrease below the Basic Rental
provided for in Paragraph 4A of the Lease or any subsequent adjustment hereof.
On such adjustment, the parties shall execute an amendment to the Lease stating
the new (adjusted) Basic Rent. If the Index is changed so that the Base Year of
the Index differs from that used as of the month immediately preceding the month
in which the term commences, the Index shall be converted in accordance with the
conversion factor published by the United States Department of Labor, Bureau of
Labor Statistics. If the Index is discontinued or revised during the term, such
other government index or other computation with which it is replaced shall be
used in order to obtain substantially the same result as would be obtained if
the Index had not been discontinued or revised.
B. Increased Interest on Encumbrances. In the event that the first or any
subsequent Premises Loan (as defined below) bears interest at an annual rate
higher than ________, the CPI-adjusted Basic Rent provided for in Paragraphs 35A
and 4A of the Lease shall be adjusted for such higher interest rate at the time
the interest rate takes effect. The interest-adjusted Basic Rent shall be
calculated by multiplying the aforesaid CPI-adjusted Basic Rent by a fraction,
the numerator of which is the new Premises Loan interest rate and the
denominator of which is _________. In no event, however, shall the interest-
adjusted Basic Rent decrease below the CPI-adjusted Basic Rent provided for in
Paragraphs 35A and 4A of the Lease. The phrase "Premises Loan" as used herein is
any borrowing from an institutional lender by Landlord, or Landlord's
predecessor in interest, whether or not secured by the Premises, the proceeds of
which are used to (i) acquire, construct or improve the Premises, or (ii) repay
a prior Premises Loan. For the purpose of this Paragraph, the definition of
interest shall include any participation in the income, revenue or cash flow
from the operation of the Premises to which any institutional lender may be
entitled.
36. LIMITATION OF LIABILITY. In consideration of the benefits accruing
-----------------------
hereunder. Tenant and all successors and assigns covenant and agree that, in
the event of any actual or alleged failure, breach or default hereunder by
Landlord:
(a) the sole and exclusive remedy shall be against Landlord's interest in
the Premises leased herein;
(b) no partner of Landlord shall be sued or named as a party in any suit or
action (except as may be necessary to secure jurisdiction of the partnership);
Page 19 of 32
(c) no service of process shall be made against any partner of Landlord
(except as may be necessary to secure jurisdiction of the partnership);
(d) no partner of Landlord shall be required to answer or otherwise plead
to any service of process;
(e) no judgment will be taken against any partner of Landlord;
(f) any judgment taken against any partner of Landlord may be vacated and
set aside at any time without hearing;
(g) no writ of execution will ever be levied against the assets of any
partner of Landlord;
(h) these covenants and agreements are enforceable both by Landlord and
also by any partner of Landlord.
Tenant agrees that each of the foregoing covenants and agreements shall be
applicable to any covenant or agreement either expressly contained in this Lease
or imposed by statute or at common law.
37. SIGNS. No sign, placard, picture, advertisement, name or notice shall be
-----
inscribed, displayed or printed or affixed on or to any part of the outside of
the Premises or any exterior windows of the Premises without the written consent
of Landlord first had and obtained and Landlord shall have the right to remove
any such sign, placard, picture, advertisement, name or notice without notice to
and at the expense of Tenant. If Tenant is allowed to print or affix or in any
way place a sign in, on, or about the Premises, upon expiration or other sooner
termination of this Lease, Tenant at Tenant's sole cost and expense shall both
remove such sign and repair all damage in such a manner as to restore all
aspects of the appearance of the Premises to the condition prior to the
placement of said sign.
All approved signs or lettering on outside doors shall be printed, painted,
affixed or inscribed at the expense of Tenant by a person approved of by
Landlord.
Tenant shall not place anything or allow anything to be placed near the
glass of any window, door partition or wall which may appear unsightly from
outside the Premises.
Landlord hereby approves the following signs:
--------------------------------------------
EGAIN COMMUNICATIONS CORPORATION
XXXXX.XXX
This space intentionally left blank.
38. MISCELLANEOUS AND GENERAL PROVISIONS
------------------------------------
A. Use of Building Name. Tenant shall not, without the written consent of
Landlord, use the name of the building for any purpose other than as the address
of the business conducted by Tenant in the Premises.
B. Choice of Law; Severability. This Lease shall in all respects be
governed by and construed in accordance with the laws of the State of
California. If any provision of this Lease
Page 20 of 32
shall be invalid, unenforceable or ineffective for any reason whatsoever, all
other provisions hereof shall be and remain in full force and effect.
C. Definition of Terms. The term "Premises" includes the space leased
hereby and any improvements now or hereafter installed therein or attached
thereto. The term "Landlord" or any pronoun used in place thereof includes the
plural as well as the singular and the successors and assigns of Landlord. The
term "Tenant" or any pronoun used in place thereof includes the plural as well
as the singular and individuals, firms, associations, partnerships and
corporations, and their and each of their respective heirs, executors,
administrators, successors and permitted assigns, according to the context
hereof, and the provisions of this Lease shall inure to the benefit of and bind
such heirs, executors, administrators, successors and permitted assigns.
The term "person" includes the plural as well as the singular and
individuals, firms, associations, partnerships and corporations. Words used in
any gender include other genders. If there be more than one Tenant the
obligations of Tenant hereunder are joint and several. The paragraph headings
of this Lease are for convenience of reference only and shall have no effect
upon the construction or interpretation of any provision hereof.
D. Time of Essence. Time is of the essence of this Lease and of each and
all of its provisions.
E. Quitclaim. At the expiration or earlier termination of this Lease,
Tenant shall execute, acknowledge and deliver to Landlord, within ten (10) days
after written demand from Landlord to Tenant, any quitclaim deed or other
document required by any reputable title company, licensed to operate in the
State of California, to remove the cloud or encumbrance created by this Lease
from the real property of which Tenant's Premises are a part.
F. Incorporation of Prior Agreements; Amendments. This instrument along
with any exhibits and attachments hereto constitutes the entire agreement
between landlord and Tenant relative to the Premises and this agreement and the
exhibits and attachments may be altered, amended or revoked only by an
instrument in writing signed by both Landlord and Tenant. Landlord and Tenant
agree hereby that all prior or contemporaneous oral agreements between and among
themselves and their agents or representatives relative to the leasing of the
Premises are merged in or revoked by this agreement.
G. Recording. Neither Landlord or Tenant shall record this lease or a
short form memorandum hereof without the consent of the other.
H. Amendments for Financing. Tenant further agrees to execute any
amendments required by a lender to enable Landlord to obtain financing, so long
as Tenant's rights hereunder are not substantially affected.
I. Additional Paragraphs. Paragraphs 39 through 55 are added hereto and
are included as a part of this lease.
J. Clauses, Plats and Riders. Clauses, plats and riders, if any, signed
by Landlord and Tenant and endorsed on or affixed to this Lease are a part
hereof.
Page 21 of 32
K. Diminution of Light, Air or View. Tenant covenants and agrees that no
diminution or shutting off of light, air or view by any structure which may be
hereafter erected (whether or not by Landlord) shall in any way affect his
Lease, entitle Tenant to any reduction of rent hereunder or result in any
liability of Landlord to Tenant.
IN WITNESS WHEREOF, Landlord and Tenant have executed and delivered this
Lease as of the day and year last written below.
LANDLORD: TENANT:
GOLDEN GATE COMMERCIAL COMPANY EGAIN COMMUNICATIONS CORPORATION
By /s/ R Cabelict By /s/ Xxxxxxxx Xxx
------------------------------ ----------------------------------
General Partner
Title CEO
--------------------------------
Date 7-22-98 Type or Print Name
----------------------------
-------------------------------------
By /s/ Xxxx X. Xxxxx By
------------------------------ -----------------------------------
General Partner
Title
--------------------------------
Date 7/22/98
----------------------------
Type or Print Name
-------------------------------------
Date
---------------------------------
Page 22 of 32
ADDENDUM PARAGRAPHS:
Paragraphs 39 through 54 to Lease Agreement dated July 21, 1998, by and between
GOLDEN GATE COMMERCIAL COMPANY, a California Limited Partnership, as Landlord,
and EGAIN COMMUNICATIONS CORPORATION, a Delaware corporation, as Tenant for
10,720+/- Square Feet of Space Located at 000 Xxxx Xxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxxxx 00000.
39. MAINTENANCE CONTRACT FOR AIR-CONDITIONING AND HEATING SYSTEM(S): Within
---------------------------------------------------------------
thirty (30) days after the commencement date of this Lease Agreement, Tenant
shall furnish to Landlord a copy of a maintenance contract for the heating and
air-conditioning systems located within and serving the Demised Premises. Said
maintenance contract shall be with a licensed contractor and shall provide for
service to said system(s) not less frequently than bi-monthly. Said contract
shall be executed by Tenant and said contractor, and said contract shall provide
that in the event of cancellation or non-renewal by Tenant, Landlord shall
receive thirty (30) days' prior written notice thereof. In the event of
cancellation or non-renewal by Tenant, Landlord shall have the right to contract
for such service and direct that such contractor send all bills, charges and
statements directly to Tenant, and Tenant agrees to pay such bills, charges and
statements immediately upon receipt. A copy of such contract shall be delivered
to Landlord within five (5) days after execution by Tenant and said contractor.
Upon termination of this Lease Agreement, Tenant shall provide Landlord with a
certification from such licensed air-conditioning contractor that all heating
and air-conditioning equipment located within the Demised Premises has been
properly maintained during the term of the Lease, and that at the time of
termination said equipment is in good operating order, condition and repair.
40. "AS-IS" BASIS. Subject only to Landlord making the improvements shown on
-------------
Exhibit "B" to be attached hereto, it is hereby agreed that the Premises leased
hereunder is leased strictly on an "as-is" basis and in its present condition,
and in the configuration as shown on Exhibit "B" to be attached hereto, and by
reference made a part hereof. Except as noted herein, it is specifically agreed
between the parties that after Landlord makes the interior improvements as shown
on Exhibit "B", Landlord shall not be required to make, nor be responsible for
any cost, in connection with any repair, restoration, and/or improvement to the
Premises in order for this Lease to commence, or thereafter, throughout the Term
of this Lease. Notwithstanding anything to the contrary within this Lease,
Landlord makes no warranty or representation of any kind or nature whatsoever as
to the condition or repair of the Premises, nor as to the use or occupancy which
may be made thereof.
41. HAZARDOUS MATERIALS. Landlord and Tenant agree as follows with respect to
-------------------
the existence or use of "Hazardous Materials" (as defined herein) on, in, under
or about the Premises and real property located beneath said Premises and the
common areas of the Parcel, which includes the entire parcel of land on which
the Premises are located as shown in Green on Exhibit "A" attached hereto
(hereinafter collectively referred to as the "Property"):
A. As used herein, the term "Hazardous Materials" shall mean any material,
waste, chemical, mixture or byproduct which is or hereafter is defined, listed
or designated under
Page 23 of 32
Environmental Laws (defined below) as a pollutant, or as a contaminant, or as a
toxic or hazardous substance, waste or material, or any other unwholesome,
hazardous, toxic, biohazardous, or radioactive material, waste, chemical,
mixture or byproduct, or which is listed, regulated or restricted by any
Environmental Law (including, without limitation, petroleum hydrocarbons or any
distillates or derivatives or fractions thereof, polychlorinated biphenyls, or
asbestos). As used herein, the term "Environmental Laws" shall mean any
applicable Federal, State of California or local government law (including
common law), statute, regulation, rule, ordinance, permit, license, order,
requirement, agreement, or approval, or any determination, judgment, directive,
or order of any executive or judicial authority at any level of Federal, State
of California or local government (whether now existing or subsequently adopted
or promulgated) relating to pollution or the protection of the environment,
ecology, natural resources, or public health and safety.
B. Tenant shall obtain Landlord's written consent, which may be withheld
in Landlord's discretion, prior to the occurrence of any Tenant's Hazardous
Materials Activities (defined below); provided, however, that Landlord's consent
shall not be required for normal use in compliance with applicable Environmental
Laws of customary household and office supplies (Tenant shall first provide
Landlord with a list of said materials use), such as mild cleaners, lubricants
and copier toner. As used herein, the term "Tenant's Hazardous Materials
Activities" shall mean any and all use, handling, generation, storage, disposal,
treatment, transportation, release, discharge, or emission of any Hazardous
Materials on, in, beneath, to, from, at or about the Property, in connection
with Tenant's use of the Property, or by Tenant or by any of Tenant's agents,
employees, contractors, vendors, invitees, visitors or its future subtenants or
assignees. Tenant agrees that any and all Tenant's Hazardous Materials
Activities shall be conducted in strict, full compliance with applicable
Environmental Laws at Tenant's expense, and shall not result in any
contamination of the Property or the environment. Tenant agrees to provide
Landlord with prompt written notice of any spill or release of Hazardous
Materials at the Property during the term of the Lease of which Tenant becomes
aware, and further agrees to provide Landlord with prompt written notice of any
violation of Environmental Laws in connection with Tenant's Hazardous Materials
Activities of which Tenant becomes aware. If Tenant's Hazardous Materials
Activities involve Hazardous Materials other than normal use of customary
household and office supplies, Tenant also agrees at Tenant's expense: (i) to
install such Hazardous Materials monitoring, storage and containment devices as
Landlord reasonably deems necessary (Landlord shall have no obligation to
evaluate the need for any such installation or to require any such
installation); (ii) provide Landlord with a written inventory of such Hazardous
Materials, including an update of same each year upon the anniversary date of
the Commencement Date of the Lease ("Anniversary Date"); and (iii) on each
Anniversary Date, to retain a qualified environmental consultant, acceptable to
Landlord, to evaluate whether Tenant is in compliance with all applicable
Environmental Laws with respect to Tenant's Hazardous Materials Activities.
Tenant, at its expense, shall submit to Landlord a report from such
environmental consultant which discusses the environmental consultant's findings
within two (2) months of each Anniversary Date. Tenant, at its expense, shall
promptly undertake and complete any and all steps necessary, and in full
compliance with applicable Environmental Laws, to fully correct any and all
problems or deficiencies identified by the environmental consultant, and
promptly provide Landlord with documentation of all such corrections.
Page 24 of 32
C. Prior to termination or expiration of the Lease, Tenant at its expense,
shall (i) properly remove from the Property all Hazardous Materials which came
to be located at the Property in connection with Tenant's Hazardous Materials
Activities, and (ii) fully comply with and complete all facility closure
requirements of applicable Environmental Laws regarding Tenant's Hazardous
Materials Activities, including but not limited to (x) properly restoring and
repairing the Property to the extent damaged by such closure activities, and (y)
obtaining from the local Fire Department or other appropriate governmental
authority with jurisdiction a written concurrence that closure has been
completed in compliance with applicable Environmental Laws. Tenant shall
promptly provide Landlord with copies of any claims, notices, work plans, data
and reports prepared, received or submitted in connection with any such closure
activities.
D. If Landlord, in its sole discretion, believes that the Property has
become contaminated as a result of Tenant's Hazardous Materials Activities,
Landlord in addition to any other rights it may have under this Lease or under
Environmental Laws or other laws, may enter upon the Property and conduct
inspection, sampling and analysis, including but not limited to obtaining and
analyzing samples of soil and ground water, for the purpose of determining the
nature and extent of such contamination. Tenant shall promptly reimburse
Landlord for the costs of such an investigation, including but not limited to
reasonable attorneys' fees Landlord incurs with respect to such investigation,
that discloses Hazardous Materials contamination for which Tenant is liable
under this Lease. Except as may be required of Tenant by applicable
Environmental laws, Tenant shall not perform any sampling, testing, or drilling
to identify the presence of any Hazardous Materials at the Property, without
Landlord's prior written consent which may be withheld in Landlord's discretion.
Tenant shall promptly provide Landlord with copies of any claims, notices, work
plans, data and reports prepared, received or submitted in connection with any
sampling, testing or drilling performed pursuant to the preceding sentence.
E. Tenant shall indemnify, defend (with legal counsel acceptable to
Landlord, whose consent shall not unreasonably be withheld) and hold harmless
Landlord, its employees, assigns, successors, successors-in-interest, agents and
representatives from and against any and all claims (including but not limited
to third party claims from a private party or a government authority),
liabilities, obligations, losses, causes of action, demands, governmental
proceedings or directives, fines, penalties, expenses, costs (including but not
limited to reasonable attorneys', consultants' and other experts' fees and
costs), and damages, which arise from or relate to: (i) Tenant's Hazardous
Materials Activities; (ii) any Hazardous Materials contamination caused by
Tenant prior to the Commencement Date of the Lease; or (iii) the breach of any
obligation of Tenant under this Paragraph 41 (collectively, "Tenant's
Environmental Indemnification"). Tenant's Environmental Indemnification shall
include but is not limited to the obligation to promptly and fully reimburse
Landlord for losses in or reductions to rental income, and diminution in fair
market value of the Property. Tenant's Environmental Indemnification shall
further include but is not limited to the obligation to diligently and properly
implement to completion, at Tenant's expense, any and all environmental
investigation, removal, remediation, monitoring, reporting, closure activities,
or other environmental response action (collectively, "Response Actions").
Tenant shall promptly provide Landlord with copies of any claims, notices, work
plans, data and reports prepared, received or submitted in connection with any
Response Actions.
Page 25 of 32
It is agreed that the Tenant's responsibilities related to Hazardous
Materials will survive the expiration or termination of this Lease and that
Landlord may obtain specific performance of Tenant's responsibilities under this
Paragraph 41.
42. UTILITIES OF THE BUILDING IN WHICH THE PREMISES ARE LOCATED. As Additional
-----------------------------------------------------------
Rent and in accordance with Paragraph 4D of this Lease, Tenant shall pay its
proportionate share (calculated on a square footage or other equitable basis as
calculated by Landlord) of the cost of all utility charges such as water, gas,
electricity, (telephone, telex and other electronic communications service, if
applicable) sewer service, waste pick-up and any other utilities, materials or
services furnished directly to the building in which the Premises are located,
including, without limitation, any temporary or permanent utility surcharge or
other exactions whether or not hereinafter imposed.
Landlord shall not be liable for and Tenant shall not be entitled to any
abatement or reduction of rent by reason of any interruption or failure of
utility services to the Premises when such interruption or failure is caused by
accident, breakage, repair, strikes, lockouts, or other labor disturbances or
labor disputes of any nature, or by any other cause, similar or dissimilar,
beyond the reasonable control of Landlord.
Provided that Tenant is not in default in the performance or observance of
any of the terms, covenants or conditions of this Lease to be performed or
observed by it, Landlord shall furnish to the Premises between the hours of 8:00
a.m. and 6:00 p.m., Monday through Fridays (holidays excepted) and subject to
the rules and regulations of the Common Area hereinbefore referred to,
reasonable quantities of water, gas and electricity suitable for the intended
use of the Premises and heat and air conditioning required in Landlord's
judgment for the comfortable use and occupation of the Premises for such
purposes. Tenant agrees that at all times it will cooperate fully with Landlord
and abide by all regulations and requirements that Landlord may prescribe for
the proper functioning and protection of the building heating, ventilating and
air conditioning systems. Whenever heat generating machines, equipment, or any
other devices (including exhaust fans) are used in the Premises by Tenant which
affect the temperature or otherwise maintained by the air conditioning system,
Landlord shall have the right to install supplementary air conditioning units in
the Premises and the cost thereof, including the cost of installation and the
cost of operation and maintenance thereof, shall be paid by Tenant to Landlord
upon demand by Landlord. Tenant will not, without the written consent of
Landlord, use any apparatus or device in the Premises (including, without
limitation), electronic data processing machines or machines using current in
excess of 110 volts which will in any way increase the amount of electricity,
gas, water or air conditioning usually furnished or supplied to premises being
used as general office space, or connect with electric current (except through
existing electrical outlets in the Premises), or with gas or water pipes any
apparatus or device for the purposes of using electric current, gas, or water.
If Tenant shall require water, gas, or electric current in excess of that
usually furnished or supplied to premises being used as general office space,
Tenant shall first obtain the written consent of Landlord, which consent shall
not be unreasonably withheld and Landlord may cause an electric current, gas or
water meter to be installed in the Premises in order to measure the amount of
electric current, gas or water consumed for any such excess use. The cost of
any such meter and of the installation,
Page 26 of 32
maintenance and repair thereof, all charges for such excess water, gas and
electric current consumed (as shown by such meters and at the rates then charged
by the furnishing public utility); and any additional expense incurred by
Landlord in keeping account of electric current, gas, or water so consumed shall
be paid by Tenant, and Tenant agrees to pay Landlord therefor promptly upon
demand by Landlord.
43. RULES AND REGULATIONS AND COMMON AREA. Subject to the terms and conditions
-------------------------------------
of this Lease and such Rules and Regulations as Landlord may from time to time
reasonably prescribe, Tenant and Tenant's employees, invitees and customers
----------
shall, in common with other occupants of the Parcel/Building in which the
premises are located, and their respective employees, invitees and customers,
and others entitled to the use thereof, have the non-exclusive right to use the
access roads, parking areas, and facilities provided and designated by Landlord
for the general use and convenience of the occupants of the Parcel/Building in
which the Premises are located, which areas and facilities are referred to
herein as "Common Area." This right shall terminate upon the termination of this
Lease. Landlord reserves the right from time to time to make changes in the
shape, size, location, amount and extent of Common Area. Landlord further
reserves the right to promulgate such reasonable rules and regulations relating
to the use of the Common Area, and any part or parts thereof, as Landlord may
deem appropriate for the best interests of the occupants of the Parcel/Building.
Such Rules and Regulations may be amended by Landlord from time to time, with or
without advance notice, and all amendments shall be effective upon delivery of a
copy to Tenant. Landlord shall not be responsible to Tenant for the non-
performance by any other tenant or occupant of the Parcel/Building of any of
said Rules and Regulations.
Landlord shall operate, manage and maintain the Common Area. The manner in
which the Common Area shall be maintained and the expenditures for such
maintenance shall be at the discretion of Landlord.
44. EXPENSES OF OPERATION, MANAGEMENT, AND MAINTENANCE OF THE COMMON AREAS OF
-------------------------------------------------------------------------
THE PARCEL AND BUILDING IN WHICH THE PREMISES ARE LOCATED. As Additional Rent
---------------------------------------------------------
and in accordance with Paragraph 4D of this Lease, Tenant shall pay to Landlord
Tenant's proportionate share (calculated on a square footage or other equitable
basis as calculated by Landlord) of all expenses of operation, management,
maintenance and repair of the Common Areas of the Parcel including, but not
limited to, license, permit, and inspection fees; security; utility charges
associated with exterior landscaping and lighting (including water and sewer
charges); all charges incurred in the maintenance and replacement of landscaped
areas, lakes, parking lots and paved areas (including repairs, replacement,
resealing and restriping), sidewalks, driveways, maintenance, repair and
replacement of all fixtures and electrical, mechanical and plumbing systems;
supplies, materials, equipment and tools; the cost of capital expenditures which
have the effect of reducing operating expenses, provided, however, that in the
event Landlord makes such capital improvements, Landlord may amortize its
investment in said improvements (together with interest at the rate of fifteen
(15%) percent per annum on the unamortized balance) as an operating expense in
accordance with standard accounting practices, provided, that such amortization
is not at a rate greater than the anticipated savings in the operating expenses.
Page 27 of 32
As Additional Rent and in accordance with Paragraph 4D of this Lease,
Tenant shall pay its proportionate share (calculated on a square footage or
other equitable basis as calculated by Landlord) of the reasonable cost of
operation (including common utilities), management, maintenance, and repair of
the building (including structural and common areas such as lobbies, restrooms,
janitor's closets, hallways, elevators, mechanical and telephone rooms,
stairwells, entrances, spaces above the ceiling and janitorization of said
common areas) in which the Premises are located. The maintenance items herein
referred to include, but are not limited to, all windows, window frames, plate
glass, glazing, truck doors, main plumbing systems of the building (such as
water drain lines, sinks, toilets, faucets, drains, showers and water
fountains), main electrical systems (such as panels and conduits), heating and
air conditioning systems (such as compressors, fans, air handlers, ducts,
boilers, heaters), structural elements and exterior surfaces of the building;
store fronts, roof, downspouts, building common area interiors (such as wall
coverings, window coverings, floor coverings and partitioning), ceilings,
building exterior doors, skylights (if any), automatic fire extinguishing
systems, and elevators (if any); license, permit and inspection fees; security,
supplies, materials, equipment and tools; the cost of capital expenditures which
have the effect of reducing operating expenses, provided, however, that in the
event Landlord makes such capital improvements, Landlord may amortize its
investment in said improvements (together with interest at the rate of fifteen
(15%) percent per annurn on the unamortized balance) as an operating expense in
accordance with standard accounting practices, provided, that such amortization
is not at a rate greater than the anticipated savings in the operating expenses.
Tenant hereby waives all rights hereunder, and benefits of, subsection 1 of
Section 1932 and Sections 1941 and 1942 of the California Civil Code and under
any similar law, statute or ordinance now or hereafter in effect.
"Additional Rent" as used herein shall not include Landlord's debt
repayments; interest on charges, expenses directly or indirectly incurred by
Landlord for the benefit of any other tenant; cost for the installation of
partitioning or any other tenant improvements; cost of attracting tenants;
depreciation; interest; or executive salaries.
45. PARKING. Tenant shall have the right to the non-exclusive use of forty-
-------
nine (49) parking spaces in the common parking area of the building. Tenant
agrees that Tenant, Tenant's employees, agents, representatives, and/or invitees
shall not use parking spaces in excess of said 49 parking spaces allocated to
Tenant hereunder. Landlord shall have the right, at Landlord's sole discretion,
to specifically designate the location of Tenant's parking spaces within the
common parking area of the building in the event of a dispute among the tenants
occupying the building referred to herein, in which event Tenant agrees that
Tenant, Tenant's employees, agents, representatives and/or invitees shall not
use any parking spaces other than those parking spaces specifically designated
by Landlord for Tenant's use. Said parking spaces, if specifically designated by
Landlord to Tenant, may be relocated by Landlord at any time, and from time to
time. Landlord reserves the right, at Landlord's sole discretion, to rescind any
specific designation of parking spaces, thereby returning Tenant's parking
spaces to the common parking area. Landlord shall give Tenant written notice of
any change in Tenant's parking spaces. Tenant shall not, at any time, park, or
permit to be parked, any trucks or vehicles adjacent to the loading area so as
to interfere in any way with the use of such areas, nor shall Tenant, at any
time, park or permit the parking of Tenant's trucks and other vehicles or the
trucks and vehicles
Page 28 of 32
of Tenant's suppliers or others, in any portion of the common areas not
designated by Landlord for such use by Tenant. Tenant shall not park nor permit
to be parked, any inoperative vehicles or equipment on any portion of the common
parking area or other common areas of the building. Tenant agrees to assume
responsibility for compliance by its employees with the parking provision
contained herein. If Tenant or its employees park in other than designated
parking areas, then Landlord may charge Tenant, as an additional charge, and
Tenant agrees to pay Ten Dollars ($10.00) per day for each day or partial day
each such vehicle is parking in any area other than that designated. Tenant
hereby authorizes Landlord, at Tenant's sole expense, to tow away from the
building any vehicle belonging to Tenant or Tenant's employees parking in
violation of these provisions (following twenty-four hours' written notice to
Tenant,) or to attach violation stickers or notices to such vehicles. Tenant
shall use the parking area for vehicle parking only and shall not use the
parking areas for storage.
46. ASSESSMENT CREDITS. The demised property herein may be subject to a
------------------
special assessment levied by the City of Sunnyvale as part of an Improvement
District. As a part of said special assessment proceedings (if any), additional
bonds were or may be sold and assessments were or may be levied to provide for
construction contingencies and reserve funds. Interest shall be earned on such
funds created for contingencies and on reserve funds which will be credited for
the benefit of said assessment district. To the extent surpluses are created in
said district through unused contingency funds, interest earnings or reserve
funds, such surpluses shall be deemed the property of Landlord. Notwithstanding
that such surpluses may be credited on assessments otherwise due against the
Leased Premises, Tenant shall pay to Landlord, as additional rent if, and at the
time of any such credit of surpluses, an amount equal to all such surpluses so
credited. For example: if (i) the property is subject to an annual assessment of
$1,000.00, and (ii) a surplus of $200.00 is credited towards the current year's
assessment which reduces the assessment amount shown on the property tax xxxx
from $1,000.00 to $800.00, Tenant shall, upon receipt of notice from Landlord,
pay to Landlord said $200.00 credit as Additional Rent.
47. ASSIGNMENT AND SUBLETTING (CONTINUED1. Any and all sublease agreement(s)
-------------------------------------
between Tenant and any and all subtenant(s) (which agreements must be consented
to by Landlord, pursuant to the requirements of this Lease) shall contain the
following language:
"If Landlord and Tenant jointly and voluntarily elect, for any reason
whatsoever, to terminate the Master Lease prior to the scheduled Master
Lease termination date, then this Sublease (if then still in effect) shall
terminate concurrently with the termination of the Master Lease. Subtenant
expressly acknowledges and agrees that (1) the voluntary termination of the
Master Lease by Landlord and Tenant and the resulting termination of this
Sublease shall not give Subtenant any right or power to make any legal or
equitable claim against Landlord, including without limitation any claim
for interference with contract or interference with prospective economic
advantage, and (2) Subtenant hereby waives any and all rights it may have
under law or at equity against Landlord to challenge such an early
termination of the Sublease, and unconditionally releases and relieves
Landlord, and its officers, directors, employees and agents, from any
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and all claims, demands, and/or causes of action whatsoever (collectively,
"Claims"), whether such matters are known or unknown, latent or apparent,
suspected or unsuspected, foreseeable or unforseeable, which Subtenant may
have arising out of or in connection with any such early termination of
this Sublease. Subtenant knowingly and intentionally waives any and all
protection which is or may be given by Section 1542 of the California Civil
Code which provides as follows: "A general release does not extend to
claims which the creditor does not know or suspect to exist in his favor at
the time of executing the release, which if known by him must have
materially affected his settlement with debtor.
The term of this Sublease is therefore subject to early termination.
Subtenant's initials here below evidence (a) Subtenant's consideration of and
agreement to this early termination provision, (b) Subtenant's acknowledgment
that, in determining the net benefits to be derived by Subtenant under the terms
of this Sublease, Subtenant has anticipated the potential for early termination,
and (c) Subtenant's agreement to the general waiver and release of Claims above.
Initials: ___________ Initials: ____________
Subtenant Tenant
48. MAINTENANCE OF THE PREMISES: Notwithstanding anything to the contrary in
---------------------------
Xxxxxxxxx 0, Xxxxxxxx shall repair damage to the structural shell, foundation,
and roof structure (but not the interior improvements, roof membrane, or
glazing) of the building leased hereunder at Landlord's cost. Landlord shall
amortize the cost of the repair over the useful life of said repair, and if
Landlord has not received insurance covering such damage, Tenant shall be
responsible for paying to Landlord one hundred percent (100%) of Tenant's
prorata share of the amortization of said cost over the full Term remaining in
the Lease at the time the repair is made; provided Tenant has not caused such
damage, in which event Tenant shall be responsible for 100 percent (100%) of any
such costs for repair or damage so caused by the Tenant. For Example: In the
-----------
event (i) the roof purlin is repaired at a cost of $10,000.00, and (ii) said
repair purlin has a useful life of twenty years, and (iii) Tenant has one year
remaining in its Lease Term at the time said repair was made, Tenant would be
charged its prorata share of $500.00 ($10,000.00 / 20 years x 1 year = $500.00)
as Additional Rent, in which case said amount would be due within thirty (30)
days of notice from Landlord. Tenant hereby waives all rights under, and
benefits of subsection I of Section 1932 and Sections 1941 and 1942 of the
California Civil Code and under any similar law, statute or ordinance now or
hereafter in effect. Notwithstanding the foregoing, a crack in the foundation or
exterior walls, or any other defect in the structure or Building that does not
endanger the structural integrity of the building, or which is not life-
threatening, shall not be considered material, nor shall Landlord be responsible
for repair of same.
In the event the Term of the Lease is extended by any other agreement
between Landlord and Tenant, Tenant's pro rata share of the earlier repair cost
shall be increased to include the additional amount payable to Landlord due to
the Extended Term of the Lease. For Example: In the event: (i) the roof purlin
------------
was repaired as illustrated above; and (ii) Tenant renews or extends this Lease
for an additional five (5) year period, Tenant would be liable for an additional
Page 30 of 32
payment to Landlord of $2,500.00 as Additional Rent. Said payment would be due
in full immediately upon Tenant's execution of any extension agreement.
49. BANKRUPTCY AND DEFAULT. Paragraph 19 is modified to provide that with
----------------------
respect to non-monetary defaults not involving Tenant's failure to pay Basic
Rent or Additional Rent, Tenant shall not be in default of any non-monetary
obligation if (i) more than thirty (30) days is required to cure such non-
monetary default, and (ii) Tenant commences cure of such default as soon as
reasonably practicable after receiving written notice of such default from
Landlord and thereafter continuously and with due diligence prosecutes such cure
to completion.
50. ABANDONMENT. Paragraph 20 is modified to provide that Tenant shall not be
-----------
in default under the Lease if it leaves all or any part of Premises vacant so
long as (i) Tenant is performing all of its other obligations under the Lease
including the obligation to pay Basic Rent and Additional Rent (ii) Tenant
provides on-site security during normal business hours for those parts of the
Premises left vacant, (iii) such vacancy does not materially and adversely
affect the validity or coverage of any policy of insurance carried by Landlord
with respect to the Premises, and (iv) the utilities and heating and ventilation
system are operated and maintained to the extent necessary to prevent damage to
the Premises or its systems.
51. FINANCIAL STATEMENTS TO BE PROVIDED BY TENANT: If Landlord desires to
---------------------------------------------
finance or refinance said Premises, Tenant hereby agrees to deliver to any
lender designated by Landlord, such financial statements of Tenant as may be
reasonably required by such lender. Such statement shall include the past three
(3) years' financial statements of Tenant. All such financial statements shall
be received by Landlord in confidence and shall be used only for the purposes
herein set forth.
52. RIGHT TO SHOW PREMISES: Landlord shall have the right on and after one
----------------------
hundred eighty (180) days from the expiration date of this lease to show the
premises at all reasonable times to prospective tenants. Tenant agrees to
cooperate with Landlord and to make the premises available to Landlord, subject
only to Landlord providing Tenant with reasonable notice in advance of
Landlord's entering the premises. Tenant further agrees that Landlord shall have
the right to post appropriate "For Lease" signs on the exterior of the building.
In the event Landlord secures a new tenant for the demised premises, and Tenant
does not vacate the premises on or before the termination date of this Lease,
Tenant shall be liable to Landlord for the full amount of rental during such
holding over period in accordance with the provisions of Paragraph 25, Holding
Over.
In addition, if Tenant's delay should in any way cause the new tenant
procured by Landlord to void the new lease with Landlord, or in any way prevent
the new lease from commencing, Tenant shall remain liable to Landlord for the
full amount of such holding over rental for the period of such new lease or
until a new tenant can be obtained by Landlord for the demised premises,
whichever occurs first. Tenant shall remain liable to Landlord for any damages
sustained by Landlord by reason of Tenant's delay or failure to vacate,
including payment of rent and other sums due Landlord.
Page 31 of 32
53. CONSENT. Whenever the consent of one party to the other is required
-------
hereunder, such consent shall not be unreasonably withheld.
54. AUTHORITY TO EXECUTE. The parties executing this Lease Agreement hereby
--------------------
warrant and represent that they are properly authorized to execute this Lease
Agreement and bind the parties on behalf of whom they execute this Lease
Agreement and to all of the terms, covenants and conditions of this Lease
Agreement as they relate to the respective parties hereto.
55. LEASE CONTINGENT UPON LANDLORD OBTAINING TERMINATION AGREEMENT WITH CURRENT
---------------------------------------------------------------------------
TENANT: This Lease is subject to and conditional upon Landlord obtaining from
------
SYNPLICITY, INC., a California corporation, the current tenant occupying the
Premises leased hereunder, a Termination Agreement satisfactory to Landlord on
or before September 14, 1998. In the event Landlord is unable to obtain said
satisfactory Termination Agreement on or before September 14, 1998, this Lease
Agreement shall, at Landlord's option, (a) be rescinded, or (b) the Commencement
Date hereof shall be modified to reflect the date Landlord so obtains said
satisfactory Termination Agreement and receives possession of the Premises
hereunder free and clear of SYNPLICITY, INC.'s occupancy; provided, however,
that said period of delay caused by SYNPLICITY, INC. shall not extend beyond
November 15, 1998. In the event this Lease does not commence by November 15,
1998 (subject only to the delays covered in Paragraph 3), this Lease shall be
automatically rescinded.
LANDLORD: TENANT:
GOLDEN GATE COMMERCIAL COMPANY EGAIN COMMUNICATIONS CORPORATION
By /s/ R Cabelict By /s/ Xxxxxxxx Xxx
----------------------------- ----------------------------------
General Partner
Title CEO
------------------------------
Date 7-22-98
----------------------------
Type or Print Name
XXXXXXXX XXX
------------------------------------
By
----------------------------------
By /s/ Xxxx X. Xxxxx
------------------------------
General Partner Title
-------------------------------
Date 7/22/98 Type or Print Name
----------------------------
------------------------------------
Date
-------------------------------
Page 32 of 32
SUPPLEMENTAL LETTER AGREEMENT
The lease agreement dated July 21, 1998 by and between GOLDEN GATE COMMERCIAL
COMPANY, a California limited Partnership, hereinafter called Landlord, and
EGAIN COMMUNICATIONS CORPORATION, a Delaware Corporation, hereinafter called
Tenant, for a portion of the one-story building located at 000 Xxxx Xxxxxx
Xxxxxx, Xxxxxxxxx, Xxxxxxxxxx 00000, is hereby amended as follows:
Tenant's obligations under the lease agreement are contingent upon the
completion of HVAC and roof inspections by Tenant and Tenant's satisfaction that
the HVAC and roof are in good condition, repair and order.
Landlord will promptly rectify any problems identified by such inspections
to Tenant's reasonable satisfaction at Landlord's sole expense.
LANDLORD: TENANT:
GOLDEN GATE COMMERCIAL COMPANY EGAIN COMMUNICATIONS CORPORATION
By /s/ R Cabelict By /s/ Xxxxxxxx Xxx
------------------------------ ---------------------------------
General Partner
Title: Chief Executive Officer
-----------------------
Date 7-22-98
----------------------------
Name: Xxxxxxxx Xxx
------------
By
-------------------------------
General Partner
Date Date July 21, 1998
----------------------------- ---------------------------------
