THIS SECOND ADDENDUM TO LEASE ("SECOND ADDENDUM") IS DATED FOR REFERENCE
PURPOSES AS OF NOVEMBER 15, 1994, AND IS MADE BETWEEN WATERFRONT TOWER PARTNERS,
L.P., A CALIFORNIA LIMITED PARTNERSHIP ("LANDLORD") AND SERENA CONSULTING,
INCORPORATED, A CALIFORNIA CORPORATION ("TENANT") TO BE A PART OF THAT CERTAIN
LEASE AND ADDENDUM THERETO, OF EVEN DATE HEREWITH BETWEEN LANDLORD AND TENANT
(HEREIN THE "LEASE FORM") CONCERNING 15,594 SQUARE FEET OF SPACE, KNOWN AS SUITE
200 (THE "PREMISES") LOCATED AT 000 XXXXXXX XXXXXXXXX, XXXX XX XXXXXXXXXX, XXXXX
XX XXXXXXXXXX (THE "PROJECT"). LANDLORD AND TENANT AGREE THAT THE LEASE FORM IS
HEREBY MODIFIED AND SUPPLEMENTED AS FOLLOWS:
1. TENANT IMPROVEMENTS:
Notwithstanding anything to the contrary in the Lease Form:
Landlord at its sole cost and expense shall construct the improvements
(the "Tenant Improvements") described in the plans and specifications,
which are attached hereto as Exhibit "B-1." The Tenant Improvements
shall be constructed in accordance with said plans and specifications,
and in a good and workmanlike manner, and using new materials and
equipment of good quality.
2. PREMISES AND COMMON AREAS:
Notwithstanding anything to the contrary in the Lease Form:
Landlord shall at all times maintain the Common Areas in good order
and repair and in a first class condition.
3. RENT:
Notwithstanding anything to the contrary in the Lease Form, Tenant's obligation
to pay Monthly Rent shall commence on the Commencement Date. Landlord and Tenant
acknowledge that upon execution of this Lease, Tenant shall pay to Landlord the
sum of Nineteen Thousand Four Hundred Ninety Two and 50/100 Dollars ($19,492.50)
as prepaid rent ("Prepaid Rent") for the first installment of Monthly Rent due
following the Commencement Date. In the event the Commencement Date does not
fall on the first (1st) day of the Month and the amount of Prepaid Rent is
therefore greater than the amount of Monthly Rent owed for the first
installment, then Landlord shall reduce the amount of the second installment of
Monthly Rent due by the excess amount of Prepaid Rent paid. All Monthly Rent and
Additional Rent shall be equitably prorated to reflect the Commencement and
Expiration Dates of the Lease.
4. ACCEPTANCE OF PREMISES: Notwithstanding anything to the contrary in the
Lease Form:
Tenant's acceptance of the Premises shall not be deemed a waiver of
Tenant's right to have defects in the Tenant Improvements or the
Premises repaired at Landlord's sole expense. Tenant shall give notice
to Landlord whenever any such defect becomes reasonably apparent, and
Landlord shall repair such defect as soon as practicable.
5. SECURITY DEPOSIT:
Notwithstanding anything to the contrary in the Lease Form:
Landlord and Tenant acknowledge that prior to the execution of this
Lease Tenant paid Landlord the sum of $11,000.00 as a Security
Deposit. This Security Deposit has accrued interest at the rate of 5%
annually and will continue to accrue interest until the Commencement
Date of the new Lease. Upon Commencement of the new Lease a Security
Deposit of $19,492.50 less the original Security Deposit (which
includes all accrued interest) shall be paid to Lessor.
6. COMPLIANCE WITH LAWS:
Notwithstanding anything to the contrary in the Lease Form:
At the Commencement Date, the Premises shall conform with all
requirements of covenants, conditions, restrictions and encumbrances,
all underwriter's requirements, and all rules, regulations, statutes,
ordinances, laws and building codes, (collectively, "Laws") applicable
thereto. Tenant shall not be required to construct or pay the cost of
complying with any underwriter's requirements or Laws requiring
construction of improvements in the Premises which are properly
capitalized under generally accepted accounting principles, unless
such compliance is necessitated solely because of Tenant's particular
use of the Premises.
7. USE OF PREMISES:
Notwithstanding anything to the contrary in the Lease Form:
If the Premises should become substantially unusable for Tenant's use
as a consequence of cessation of utilities or other services required
to be provided to the Premises by Landlord for a period longer than 3
business days, or the presence of any material which is now or
hereafter regulated by any governmental authority or which poses a
hazard to the environment or human life ("Hazardous Material") which
does not result from Tenant's introduction, use, storage or disposal
of such material in violation of applicable law in or about the
Premises, then Tenant shall be entitled to an abatement of rent to the
extent of the interference with Tenant's use of the Premises
occasioned thereby. If such interference cannot be corrected or the
damage resulting therefrom repaired so that the Premises will be
reasonably suitable for Tenant's intended use within sixty (60) days
following the occurrence of such event, then Tenant also shall be
entitled to terminate this Lease by delivery of written notice to
Landlord at any time after occurrence of the event of interfering with
Tenant's use.
8. ALTERATIONS, ADDITIONS AND IMPROVEMENTS:
Notwithstanding anything to the contrary in the Lease Form:
A. NONSTRUCTURAL:
If Landlord's consent is required for an Alteration and Landlord does
not notify Tenant in writing of its approval or disapproval within
fifteen (15) days following Tenant's written request for approval,
then Landlord shall be deemed to have approved the proposed
Alteration.
B. REMOVAL:
Upon request, Landlord shall advise Tenant in writing whether it
reserves the right to require Tenant to remove any Alterations from
the Premises upon termination of the Lease.
C. TENANT'S PROPERTY:
Excepting those improvements specified in Exhibit B-1, all
Alterations, trade fixtures and personal property installed in the
Premises at Tenant's expense ("Tenant's Property") shall at all times
remain Tenant's property and Tenant shall be entitled to all
depreciation, amortization and other tax benefits with respect
thereto. Except for Alterations which cannot be removed without
structural injury to the Premises, at any time Tenant may remove
Tenant's Property from the Premises, provided Tenant repairs all
damage caused by such removal.
X. XXXX WAIVER:
Landlord shall have no lien or other interest whatsoever in any item
of Tenant's Property, or any portion thereof or interest therein
located in the Premises or elsewhere, and Landlord hereby waives all
such liens and interests, except in the event that Tenant is in
default of the Lease Agreement and terms thereof. Within ten (10) days
following Tenant's request, Landlord shall execute documents in a form
reasonably acceptable to Tenant to evidence Landlord's waiver of any
right, title, lien or interest in Tenant's Property located in the
Premises.
E. SALE OF TENANT'S PROPERTY:
Landlord shall provide Tenant with at least five (5) days prior
written notice of any sale of Tenant's Property.
9. DIRECT EXPENSES:
Notwithstanding anything to the contrary in the Lease Form:
The term Direct Expenses as defined in Paragraph 6.1.3 of the Lease
Form shall not include and in no event shall Tenant have any
obligation to perform or to pay directly, or to reimburse Landlord
for, all or any portion of the following repairs, maintenance,
improvements, replacements, premiums, claims, losses, fees, charges,
costs and expenses (collectively, "Costs"), nor shall any portion of
the Tenant Improvement allowance be applied to such costs:
A. LOSSES CAUSED BY OTHERS:
Costs occasioned by the act, omission or violation of Law by Landlord,
any other occupant of the Project, or their respective agents,
employees or contractors.
B. CASUALITIES AND CONDEMNATIONS:
Costs occasioned by fire, acts of God, or other casualties or by the
exercise of the power of eminent domain.
C. REIMBURSABLE EXPENSES:
Costs for which Landlord has a right of reimbursement from others.
D. REAL ESTATE TAXES:
Taxes, assessments, all other governmental levies, and any increases
in the foregoing occasioned by or relating to (i) a conveyance or
other transfer of the real property of which the Premises is a part
(a) to any person or entity affiliated with or related to Landlord or
the partners, shareholders, officers or directors of Landlord or (b)
in connection with estate planning or (c) which is not otherwise a
bona fide, arm's length sale to an unrelated third party.
E. UTILITIES OR SERVICES:
Costs (i) arising from the disproportionate use of any utility or
service supplied by Landlord to any other occupant of the Project, or
(ii) associated with utilities and services of a type not provided to
Tenant.
F. MORTGAGES:
Interest, charges and fees incurred on debt, payments on mortgages and
rent under ground leases.
G. HAZARDOUS MATERIALS:
Costs incurred to investigate the presence of any Hazardous Material
(defined in the Lease), Costs to respond to any claim of Hazardous
Material contamination or damage, Costs to remove any Hazardous
Material from the Project and any judgments or other Costs incurred in
connection with any Hazardous Material exposure or releases, except to
the extent caused by the storage, use or disposal of the Hazardous
Material in question by Tenant.
H. MANAGEMENT:
Any fee, profit or compensation retained by Landlord or its affiliates
for management and administration of the Project in excess of the
management fee which would be charged by a professional management
services for operation of comparable projects in the vicinity.
I. DUPLICATION:
Costs and expenses for which Tenant reimburses Landlord directly or
which Tenant pays directly to a third person.
10. COMPUTATION OF BASE AMOUNT:
Notwithstanding anything to the contrary in the Lease Form:
The Base Year accounting method shall be used in calculating the
Direct Expenses. The Base Year for this Lease shall be the 1995
Calendar Year Actual Expenses.
11. INDEMNITY:
Notwithstanding anything to the contrary in the Lease Form:
A. LANDLORD'S INDEMNIFICATION. Landlord shall indemnify and hold
harmless Tenant from all damages, liabilities, claims, judgments,
actions, attorneys' fees, consultants' fees, costs and expenses
arising from the negligence or willful misconduct of Landlord or its
employees, agents, contractors or invitees, or the breach of
Landlord's obligations or representations under this Lease.
12. ASSIGNMENT AND SUBLETTING:
Notwithstanding anything to the contrary in the Lease Form:
Tenant may, with Landlord's prior written consent, sublet the Premises
to: (i) a subsidiary, affiliate, division or corporation controlled or
under common control with Tenant; (ii) a successor corporation related
to Tenant by merger, consolidation, nonbankruptcy reorganization, or
government action; (iii) purchaser of substantially all of Tenant's
assets located in the Premises (collectively, "Permitted
Sublessee's"). For the purpose of this Lease, sale or transfer of
Tenant's capital stock, including without limitation, a transfer in
connection with the merger, consolidation or nonbankruptcy
reorganization of Tenant and any sale through any public exchange,
shall not be deemed an assignment, subletting, or any other transfer
of the Lease or the Premises. Landlord's consent to any proposed
subletting shall not be unreasonably withheld. If Tenant assigns or
sublets the Premises to any Permitted Sublessee as provided herein,
Landlord shall not have the right to terminate the Lease due to such
assignment or sublease. Any rents received from sublessee in excess of
the base amount shall be split 50%/50% between Landlord and Tenant.
13. APPROVALS:
Notwithstanding anything to the contrary in the Lease Form, whenever the Lease
requires an approval, consent, designation, determination or judgment by either
Landlord or Tenant, such approval, consent, designation, determination or
judgment (including, without limiting the generality of the foregoing, those
required in connection with assignment and subletting) shall not be unreasonably
withheld or delayed and in exercising any right or remedy hereunder, each party
shall at all times act reasonably and in good faith.
14. REASONABLE EXPENDITURES:
Notwithstanding anything to the contrary in the Lease Form, any expenditure by a
party permitted or required under the Lease, for which such party is entitled to
demand and does demand reimbursement from the other party, shall be limited to
the fair market value of the goods and services involved, shall be reasonably
incurred, and shall be substantiated by documentary evidence available for
inspection and review by the other party or its representative during normal
business hours.
15. DAMAGE OR DESTRUCTION:
Notwithstanding anything to the contrary in the Lease Form:
A. UNINSURED CASUALTY: In the case of damage which is not required
to be covered by insurance, Landlord shall not have the right to
terminate the Lease (i) if the repair or restoration would cost less
than five percent (5%) of the replacement cost of the Premises and/or
Building, or (ii) if Tenant agrees to pay the cost of repair or
restoration in excess of five percent (5%) of the replacement cost of
the Premises and/or Building.
16. SALE OF PROPERTY: Notwithstanding anything to the contrary in the Lease
Form, Landlord shall not be relieved of its obligations under the Lease upon a
sale of the Building, unless the purchasing owner assumes the obligations of
Landlord in writing.
17. MODIFICATIONS TO LEASE FORM: The Lease Form is modified as follows:
A. Paragraph 4.1 is modified by deleting the last sentence thereof
and replacing it with the following: "Notwithstanding anything to the
contrary in the Lease Form:
(i) The Lease shall commence (the "Commencement Date") on the later
of the Anticipated Commencement Date of November 1, 1994 or (ii) the
date by which all of the following have occurred: (a) Landlord has
substantially completed the
Tenant Improvements as that term is defined in the Work Letter
Agreement attached hereto as Exhibit "B" and as described in
Paragraph 41 of the Lease Addendum, (b) there remains no incomplete
or defective item of Tenant Improvements that would adversely affect
Tenant's intended use of the Premises; (c) Landlord has delivered
possession of the Premises to Tenant; and (d) Landlord has obtained
all approvals and permits from the appropriate governmental
authorities required for the legal occupancy of Premises for Tenant's
intended use.
B. Paragraph 4.2 is modified by inserting the words "in accordance
with Paragraph 4.1 of this Lease", after the words "is determined" in
the second line thereof.
C. Paragraph 4.4 is deleted in its entirety and replaced with the
following: "4.4 Tenant Delays. "To the extent that occurrence of the
"Commencement Date" is delayed because of Tenant's failure to perform
its obligations under this Lease, then notwithstanding any other
provision of this Lease, the obligation to pay Monthly Rent shall be
advanced and begin one (1) day sooner than it would otherwise occur
for each day of such delay caused by Tenant's default."
D. Paragraph 4.5 is modified as follows: (a) the word "reasonable"
is inserted after the words "such additional" in the fifth line
thereof.
E. Paragraph 5.2 is deleted.
F. Paragraph 6.1.2. is modified as follows: (a) the word "amount" in
the second line thereof is replaced with the words "Direct Expenses
Base Year".
G. Paragraph 6.1.3.1 is modified as follows: (a) the word "on"
located between the words "taxes" and "levied" on the third line
thereof is deleted; and (b) the word ",transfer" is added after the
word "estate" on the eleventh line thereof.
H. Paragraph 6.1.3.2 is modified as follows: (a) the following
phrase is added after the word "therewith" in subparagraph "(e)"
thereof: "to the extent such insurance is commercially reasonable."
I. Paragraph 6.2 is modified as follows: (a) the words "upon
receipt" on the fifth line thereof shall be replaced with the words
"on or before ten (10) days after receipt of Landlord's statement by
Tenant".
J. Paragraph 9 is modified as follows: (a) the first sentence
thereof is deleted; (b) the words "ten (10) days" shall be deleted and
replaced with the words "fifteen (15) working days" in the fourth line
thereof; and (c) the following sentence is added after the second
sentence thereof: "Landlord shall use its best efforts to complete,
repair and/or remedy any items on the punch list or any existing
conditions inconsistent with Landlord's obligations hereunder."
K. Paragraph 11.2.3 is modified as follows: (a) the phrase "as
required by law" is added after the word "contamination" in the tenth
line thereof; (b) the phrase "caused by Tenant's use, storage,
release, disposal, or transportation of Hazardous Materials" shall be
added to the end of subsection (i) after the word "contamination" and
at the end of subsection (ii) after the word "proceeding" in lines
twelve and thirteen thereof; and (c) the following shall be added to
the end of paragraph 11.2.3:
A. LANDLORD INDEMNITY:
Landlord shall indemnify, defend with counsel reasonably
acceptable to Tenant, protect, and hold harmless Tenant, its
employees, agents, contractors, stockholders, officers,
directors, successors, subtenants, personal representatives, and
assigns (collectively the "Tenant Indemnities") from and against
all claims, actions, suits, proceedings, judgments, losses,
costs, personal injuries, damages, liabilities, deficiencies,
fines, penalties, damages, attorneys' fees, consultants' fees,
investigations, detoxifications, remediations, removals, and
expenses of every type and nature ("Claims"), directly or
indirectly arising out of or in connection with any Hazardous
Material present at any time on or about the Premises, or the
soil, air, improvements, groundwater or surface water thereof, or
the violation of any
Environmental Law relating to any such Hazardous Material, the
Premises or the use of the Premises by any person other than
Tenant, its agents or employees; except to the extent that any
of the foregoing actually results from the release, disposal,
discharge, or emission of Hazardous Material on or about the
Premises during the term of this Lease by Tenant or its agents
or employees in violation of applicable Environmental Laws. In
such event tenant will be soley responsible and Landlord will be
indemnified by Tenant for any costs thereto and Tenant will
relieve Landlord of any liability thereto.
B. LANDLORD'S REPRESENTATIONS:
Except as disclosed in the following reports, true and correct
copies of which have been delivered by Landlord to Tenant, to the
best knowledge of Landlord, (i) no Hazardous Material is present
on the Project or the Premises or the soil, surface water or
groundwater thereof, (ii) no underground storage tanks or
asbestos containing building materials are present on the Project
or the Premises, and (iii) no action, proceeding, or claim is
pending or threatened concerning the Project or the Premises
concerning any Hazardous Material or pursuant to any
Environmental Law.
C. DEFINITION OF ENVIRONMENTAL LAWS:
As used herein "Environmental Laws" shall mean all local, state,
or federal laws, statutes, ordinances, rules, regulations,
judgments, injunctions, stipulations, decrees, orders, permits,
approvals, treaties, or protocols now or hereafter enacted,
issued or promulgated by any governmental authority which relate
to any Hazardous Material or the use, handling, transportation,
production, disposal, discharge, release, emission, sale, or
storage of, or the exposure of any person to, a Hazardous
Material."
L. Paragraph 13 is modified as follows: (a) the phrase "Subject to
Section 2.10 and Exhibit "B-1" of this Lease and Paragraph 41 of the
Addendum," is added to the beginning of the second full paragraph
thereof which begins with the words "All Alterations"; (b) the words
"relating to the specific Alterations made" is added to the first
sentence of the second full paragraph after the words "applicable
laws".
M. Paragraph 14 is modified be deleting the word "approved" in the
third line and inserting the words "if such approval is required"
after the word "Alterations" in the third sentence thereof.
N. Paragraph 17.1 is modified as follows: (a) the phrase "at its
sole cost and expense" is added after the word "Landlord" in the first
sentence thereof.
O. Paragraph 17.2 is modified as follows: (a) the words
"non-structural, internal portion" is added after the words "every
part of the" in the second line thereof; and (b) the following is
added to the end of Paragraph 17.2: "Notwithstanding anything to the
contrary herein, Landlord shall perform and construct, and Tenant
shall have no responsibility to perform or construct, any repair,
maintenance or improvement (i) necessitated by the acts or omissions
of Landlord or any other occupant of the Project, or their respective
agents, employees or contractors, (ii) occasioned by fire, acts of God
or other casualty or by the exercise of the power of eminent domain,
(iii) required as a consequence of any violation of Law or
construction defect in the Premises or Project as of the Commencement
Date, (iv) for which Landlord has a right of reimbursement from
others, (v) to the heating, ventilating, air conditioning, electrical,
water, sewer, and plumbing systems serving the Premises or the
Project, and (vi) to any portion of the Project outside of the
demising walls of the Premises. Tenant's obligation, if any, to
reimburse Landlord for the costs of such repairs, maintenance and
improvements shall be governed by the other provisions of this Lease."
P. Paragraph 19 is modified as follows: (a) the words "or use of the
Premises" is added after the word "business" in the tenth line
thereof; and (b) the following shall be added to the end of the
paragraph: "During any such entry Landlord and Landlord's agents shall
at all times be accompanied by Tenant, if Tenant provides an escort."
Q. Paragraph 20 is modified as follows: (a) the word "maintenance"
is deleted from the fourth line thereof.
R. Paragraph 21.2 is modified by adding the word "reasonably"
between the words "carriers" and "acceptable" on the third line
thereof.
S. Paragraph 21.4 is modified by deleting the words "and such other
insurance as Landlord or" in line two thereof and replacing those
words with "as".
T. Paragraph 21.6 is modified by adding the word "reasonably"
between the words "form" and "satisfactory" in the first line thereof.
U. The third paragraph of Paragraph 22.2.3 is modified as follows:
(a) the word "reasonable" is inserted before the words "estimated
repair" in the third line thereof; (b) the word "ten (10)" is replaced
with the word "fifteen (15)" in the seventh line thereof.
V. Paragraph 22.3 is modified by inserting after the word "be" in
the third line thereof the following: "and as each existed immediately
prior to the destructive event."
W. Paragraph 22.5 is modified as follows: (a) the word "and" is
deleted from the fifth line thereof and the words "and 22.3" are added
after the number "22.2".
X. Paragraph 24.4 is modified as follows: (a) Subsection "(ii)" is
deleted; (b) the words "fifty percent (50%) of" is inserted between
the word "that" and "any" in the tenth line thereof; and (c) the words
"any other Tenant expenses incurred in subletting the Premises and any
special improvements to the Premises for the subtenant for which
Tenant paid" is added after the word "sublet" in the twelfth line
thereof.
Y. Paragraph 25.1.1 is modified by deleting the phrase "within five
(5) days after the date due" and replacing it with the following: "on
or before ten (10) days after actual receipt by Tenant of written
notice from Landlord of the sum due and owing."
Z. Paragraph 25.2.2.4 is modified by adding the following after the
word "thereof" in subsection (ii): "to the extent necessary to obtain
new tenants and only to the extent applicable for the period of the
Lease Term remaining after Tenant's default".
AA. Paragraph 28 is modified by deleting the words "and costs" at the
end of the last sentence thereof and by adding the following: "court
costs, and expert fees as may be fixed by the court. 'Prevailing
Party' as used herein includes a party who dismisses an action for
recovery hereunder in exchange for sums allegedly due, performance of
covenants allegedly breached or considerations substantially equal to
the relief sought in the action."
BB. Paragraph 29.2 is modified as follows (a) the phrase "if
available at no additional cost or if a fee is incurred, Landlord can
reimburse said, reasonable fee," shall be inserted after the words
"statements year" in the third line thereof and after the word "year"
in the fourth line thereof; and (b) the following is added to the end
of the paragraph: "Notwithstanding anything to the contrary herein,
Tenant shall be required to provide financial statements only in
connection with Landlord's sale or refinancing of the Project and all
such statements shall be held in strictest confidence."
CC. Paragraph 30 is modified by adding the words "all of" before
"Landlord's" and adding the words "covenants and" after the word
"Landlord's" in the last line thereof.
DD. Paragraph 31 is modified as follows: (a) the phrase "within the
time periods specified in Paragraphs (22.A(i) and (ii) as applicable,"
in the second and third lines thereof is deleted and replaced with the
following: "after written notice from Landlord as required herein and
expiration of any applicable cure period,"; (b) the term "reasonable"
shall be inserted before the word "sums" and "penalties" in the sixth
sentence thereof; and (c) the phrase "on the next day" is deleted and
replaced with "on or before five (5) days".
EE. Paragraph 38 is modified by adding the following:
"Notwithstanding anything to the contrary herein, without charge,
Tenant shall have the
exclusive use of not less than eleven (11) covered parking spaces.
Landlord shall in no event oversubscribe parking."
FF. Paragraph 42 of the Addendum is modified as follows: (a) the
second paragraph is deleted and replaced with the following: "If the
parties cannot agree on the Monthly Rent within thirty (30) days prior
to the commencement of such Extended Term, then rent for the extended
space shall be determined by an appraisal. All other terms and
conditions contained in the Lease and this Addendum, as the same may
be amended from time to time by the parties in accordance with the
provisions of the Lease, shall remain in full force and effect and
shall apply during the Extended Term.
If it becomes necessary to determine the fair market rental value for
the Premises by appraisal, real estate appraiser(s), all of whom shall
be members of the American Institute of
Real Estate Appraisers and who have at least five (5) years experience
appraising office space located in the vicinity of the Premises shall
be appointed and shall act in accordance with the following
procedures:
(i) If the parties are unable to agree on the Fair Market Rent within
the allowed time, either party may demand an appraisal by giving
written notice to the other party, which demand to be effective must
state the name, address and qualifications of an appraiser selected by
the party demanding an appraisal (the "Notifying Party"). Within ten
(10) days following the Notifying Party's appraisal demand, the other
party (the "Non-Notifying Party") shall either approve the appraiser
selected by the notifying party or select a second properly qualified
appraiser by giving written notice of the name, address and
qualification of said appraiser to the Notifying Party. If the
Non-Notifying Party fails to select an appraiser within the ten (10)
day period, the appraiser selected by the Notifying Party shall be
deemed selected by both parties and no other appraiser shall be
selected. If two appraisers are selected, they shall select a third
appropriately qualified appraiser. If the two appraisers fail to
select a third qualified appraiser, the third appraiser shall be
appointed by the then presiding judge of the county where the Premises
are located upon application by either party.
(ii) If only one appraiser is selected, that appraiser shall
notify the parties in simple letter form of its determination of the
Fair Market Rent for the Premises within fifteen (15) days following
his selection, which appraisal shall be conclusively determinative and
binding on the parties as the appraised Fair Market Rent.
(iii) If multiple appraisers are selected, the appraisers shall
meet not later than ten (10) days following the selection of the last
appraiser. At such meeting the appraisers shall attempt to determine
the Fair Market Rent for the Premises as of the commencement date of
the extended term by the agreement of at least two (2) of the
appraisers.
(iv) If two (2) or more of the appraisers agree on the Fair
Market Rent for the Premises at the initial meeting, such agreement
shall be determinative and binding upon the parties hereto and the
agreeing appraisers shall, in simple letter form executed by the
agreeing appraisers, forthwith notifying both Landlord and Tenant of
the amount set by such agreement. If multiple appraisers are selected
and two (2) appraisers are unable to agree on the Fair Market Rent for
the Premises, all appraisers shall submit to Landlord and Tenant an
independent appraisal of the Fair Market Rent for the Premises in
simple letter form within twenty (20) days following appointment of
the final appraiser. The parties shall then determine the Fair Market
Rent for the Premises by averaging the appraisals; provided that any
high or low appraisal, differing from the middle appraisal by more
than ten percent (10%) of the middle appraisal, shall be disregarded
in calculating the average.
(v) The appraisers' determination of Fair Market Rent shall be based
on rental of space of the same age, construction, size and location as
the Premises with the improvements installed therein at Landlord's
expense and shall take into account Tenant's obligations to pay
additional rent under this Lease. In determining Fair Market Rent, the
appraisers shall not consider any alterations installed in the
Premises at Tenant's expense.
(vi) If only one appraiser is selected, then each party shall pay
one-half of the fees and expenses of that appraiser. If three
appraisers are selected, each party shall bear the fees and expenses
of the appraiser it selects and one-half of the fees and expenses of
the third appraiser. Notwithstanding anything to the contrary
contained in this Paragraph, if the rent during the Extended Term is
determined by appraisal and if Tenant does not, in its sole
discretion, approve the rental amount established by such appraisal,
Tenant may rescind its exercise of the Option by giving Landlord
written notice of such election to
rescind within ten (10) days after receipt of all appraisals. If
Tenant rescinds its exercise of the Option, then (i) the Lease shall
terminate on the thirtieth (30th) day after Tenant's notice of
rescission or on the date the Lease would have otherwise terminated
absent Tenant's exercise of the Option, whichever date is later; and
(ii) Tenant shall pay all costs and expenses of the appraisal.
GG. Paragraph 43 of the Addendum is modified as follows: (a) the word
"the" is deleted and the words "a continuing" is inserted before the
words "First Right of Offering" in the first line thereof; (b) the
word "and the basic business terms for the expansion space" is
inserted after the word "and" in the third line thereof; and (c) the
words "all the basic business terms, including the monthly rent for,"
are inserted after the word "on" in the fifth line thereof.
19. EFFECT OF ADDENDUM:
All terms with initial capital letters used herein as defined terms shall have
the meanings ascribed to them in the Lease Form unless specifically defined
herein. As used herein, the term "Lease" shall mean the Lease Form, this Second
Addendum and all riders, exhibits, rules, regulations, referred to in the Lease
Form or this Second Addendum.
Landlord: WATERFRONT TOWER PARTNERS, L.P., a California limited partnership
By: /s/ Xxxxxx X. Orphan, Pres. Date:12/1/94
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Tenant: SERENA CONSULTING, INCORPORATED, a California corporation
By: /s/ Xxxxxxx X. Xxxxxx Date: 94/11/21
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