1
EXHIBIT 10.28
SUBLEASE
BY AND BETWEEN
FIRST DATA MERCHANT SERVICES CORPORATION,
A SUBSIDIARY OF FIRST DATA CORPORATION
SUBLESSOR
AND
XXXXXXXX.XXX CORPORATION
SUBTENANT
2
TABLE OF CONTENTS
Incorporation of Recitals................................................. 1
Demise and Term........................................................... 1
Subtenant Improvements Allowance.......................................... 2
Subtenant Alterations..................................................... 3
Use....................................................................... 3
Subordinate to Main Lease................................................. 4
Compliance with Main Lease................................................ 4
Performance by Sublessor.................................................. 5
No Breach of Main Lease................................................... 5
No Privity of Estate...................................................... 5
Indemnity................................................................. 5
Rent...................................................................... 6
Condition of Premises..................................................... 7
Consents and Approvals.................................................... 7
Notice.................................................................... 7
Termination of Main Lease................................................. 8
i
3
Maintenance and Repair................................................... 8
Assignment and Sublettings............................................... 8
Insurance................................................................ 9
Right to Cure Subtenant's Defaults and Damages........................... 9
Remedies of Sublessor.................................................... 10
Brokerage................................................................ 11
Waiver of Jury Trial and Right to Counterclaim........................... 11
No Waiver................................................................ 11
Complete Agreement....................................................... 11
Successors and Assigns................................................... 11
Interpretation........................................................... 12
Consent of Landlord Under Main Lease..................................... 12
Holding Over............................................................. 12
Security Deposit......................................................... 12
Counterparts............................................................. 13
No Offer................................................................. 13
Hazardous Materials...................................................... 13
ii
4
Signage................................................................... 13
Parking................................................................... 14
iii
5
SUBLEASE
THIS SUBLEASE ("Sublease") is made and dated as of the ____ day of ____,
1998, by and between FIRST DATA MERCHANT SERVICES CORPORATION, a Florida
corporation, having an address of 0000 Xxx Xxxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx,
Xxxxxxx 00000 ("Sublessor") and XXXXXXXX.XXX CORPORATION, a California
corporation having an address of 0000 Xxxx Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxx
("Subtenant").
W I T N E S S E T H:
WHEREAS, Sublessor is tenant under that certain Build-To-Suit Lease
Agreement dated as of March 18, 1997 (the "Main Lease") with Sunnyvale Partners
Limited Partnership, an Illinois limited partnership ("Overlandlord") as
landlord, whereby Overlandlord leased to Sublessor land and improvements
consisting of a to-be constructed two-story office building containing
approximately 75,197 rentable square feet of office space located at 0000 Xxxx
Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxx (the "Building");
WHEREAS, the Building has since been constructed; and
WHEREAS, Sublessor desires to sublet a portion of the Building comprised
of approximately 52,185 rentable square feet located on the first and second
floors of the Building as more particularly shown and described on Exhibit B
attached hereto and incorporated herein by this reference (the "Premises") to
Subtenant, and Subtenant desires to sublet the Premises from Sublessor;
WHEREAS, the parties are agreeable to entering into a sublease of the
Premises on the terms and conditions set forth below; and
WHEREAS, unless otherwise defined in this Sublease, all capitalized terms
used herein have the meanings set out for them in the Main Lease.
AGREEMENT
NOW, THEREFORE, for and in consideration of the mutual promises set forth
herein and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, Sublessor and Subtenant hereby agree as
follows:
1. Incorporation of Recitals. The foregoing recitals are incorporated
into and made a part of this Sublease as if each were specifically recited
herein.
2. Demise and Term. Sublessor hereby subleases the Premises to
Subtenant, and Subtenant hereby hires and accepts the Premises from Sublessor.
The Premises shall include the non-exclusive appurtenant right to the use, in
common with others, of the lobbies, entrances, stairs, corridors, elevators and
other public portions of the Building. The term of this Sublease (the "Term")
shall be the period commencing July 1, 1998 (the "Commencement Date"), and
ending at 12:01 a.m. on the date which is sixty-two (62) months after the
Commencement Date (the "Expiration Date"), unless sooner terminated as herein
provided. Subtenant shall have no option to renew or extend the term of this
Sublease or to expand the Premises.
6
3. Subtenant Improvements and Allowance. Sublessor agrees to contribute
a maximum amount of One Dollar and no/100 ($1.00) per square foot of rentable
area of the Premises for the completion of the Subtenant Improvements (as
hereinafter defined) ("Allowance") as more specifically set forth in this
Section 3.
a. Subtenant Improvements shall mean such items of general
applicability to office space that Subtenant desires to be installed in the
interior of the Premises. Subtenant shall deliver to Sublessor a space plan for
the Premises (the "Space Plan"), which Space Plan shall be subject to the
approval of Sublessor, which approval shall not be unreasonably withheld. Upon
Sublessor's approval of the Space Plan, Subtenant shall engage and pay for the
services of a licensed architect to prepare complete and detailed working
drawings and specifications for the construction of the Subtenant Improvements,
showing thereon all Subtenant Improvements (the "Drawings"). The Drawings shall
be subject to the approval of Sublessor, which approval shall not be
unreasonably withheld. If Sublessor should disapprove such Drawings, Sublessor
shall specify to Subtenant the reasons for its disapproval and Subtenant shall
cause the same to be revised to meet the Sublessor and Subtenant's mutual
reasonable satisfaction and Subtenant shall resubmit the same to Sublessor, as
so revised. It is understood by the parties that Subtenant has elected to
retain a general contractor and arrange for the construction and installation of
the Subtenant Improvements itself in a good and workmanlike manner [by labor
union contractors and subcontractors?] (the "Work"). Subtenant shall submit to
Sublessor the name of the general contractor and major subcontractors for
Sublessor's approval, which shall not be unreasonably withheld, or, at
Sublessor's option, Subtenant shall select its general contractor and major
subcontractors from a list pre-approved by Sublessor. If Sublessor shall reject
the general contractor or any major subcontractor, Sublessor shall advise
Subtenant of the reasons in writing and Subtenant shall choose another
contractor. Along with Subtenant's notice of its general contractor and major
subcontractors, Subtenant shall notify Sublessor of its estimate of the total
costs of the Work and, at Sublessor's option, Subtenant must provide to
Sublessor adequate assurance that Subtenant has the financial resources to pay
for such costs. Subtenant's contractors shall be duly licensed and shall obtain
and provide to Sublessor with certificates evidencing worker's compensation,
public liability and property damage insurance in amounts and forms and with
companies satisfactory to Sublessor. Subtenant's agreement with its contractors
shall require such contractors to provide daily cleanup of the work area to the
extent such clean up is necessitated by the Work, and to take reasonable steps
to minimize interference with other tenants' use and occupancy of the Building.
Subtenant and Subtenant's contractors shall comply with any other reasonable
rules, regulations or requirements that Sublessor or Overlandlord shall impose.
Subtenant may request reasonable changes in the Drawings provided that no change
shall be made to the Drawings without Sublessor's prior written approval, which
shall not be unreasonably withheld or delayed; (b) no such request shall effect
any structural change in the Building or otherwise render the Premises or
Building in violation of applicable laws; (c) Subtenant shall be responsible for
all costs of same; and (d) such requests shall constitute agreement by Subtenant
to any delay in completion caused by Sublessor's reviewing and processing such
change. Subtenant shall promptly pay any and all costs and expenses in
connection with or arising out of the performance of the Work and shall furnish
to Sublessor evidence of such payment upon request. Subtenant agrees not to
suffer or permit any mechanic, materialman, architect, broker or other lien to
be placed or filed against the Premises or the Building. In case any such lien
shall be filed, Subtenant shall immediately file and release such lien of
record. If Subtenant shall fail to have such lien immediately satisfied and
released, Sublessor may, on Subtenant's behalf, without being responsible for
any investigation as to the validity of such lien and without limiting any other
remedies Sublessor may have, pay the same and Subtenant shall upon demand pay
Sublessor the amount so paid.
2
7
b. Upon completion of the Work, Subtenant may submit to Sublessor a
request in writing for the Allowance which request shall include: (i) as-built
drawings showing all of the Subtenant Improvements; (ii) a detailed breakdown
of final and total costs, together with receipted invoices showing payment
thereof; (iii) a certified written statement from the architect that the
Subtenant Improvements have been completed in compliance with the Drawings;
(iv) final lien waivers and releases from the architect, general contractor and
all subcontractors and suppliers; and (iv) a copy of a certificate of occupancy
for the Premises. Provided the request includes all of the foregoing, Sublessor
shall pay the Allowance to Subtenant within 30 days of Sublessor's receipt of
such request and all supporting documentation.
c. Subtenant hereby acknowledges and agrees that it is Subtenant's
sole and exclusive responsibility to cause the Premises and Drawings to comply
with all applicable laws, including the Americans with Disabilities Act and
other ordinances, orders, rules, regulations and requirements of all
governmental authorities having jurisdiction thereof. Notwithstanding anything
to the contrary contained in the Sublease or herein, Sublessor's participation
in the preparation of the Space Plan, the Drawings and/or the Subtenant
Improvements shall not constitute any representation or warranty, express or
implied, that the (i) Drawings are in conformity with applicable codes,
regulations or rules or (ii) the Subtenant Improvements, if built in accordance
with the Drawings will be suitable for Subtenant's intended purposes. Subtenant
acknowledges and agrees that the Subtenant Improvements are intended for use by
Subtenant and the requirements for such improvements are not within the special
knowledge of Sublessor.
d. Subtenant shall repair or replace (or at Sublessor's election,
reimburse Sublessor for the cost of repairing or replacing) any portion of the
Building or Premises or Sublessor's property damage, lost or destroyed in
connection with the Work and shall indemnify, defend and hold Sublessor
harmless from and against any and all losses, costs, damages, expenses and
liabilities, including without limitation reasonable attorneys fees, incurred
by Sublessor in connection with the Work, including but not limited claims
based on personal injury or property damage, contract claims and/or lien claims.
e. There shall be no delay in the Commencement Date or the payment of
rent due to any delay in the Work.
4. Subtenant Alterations. Subtenant shall not make any alterations,
additions, or improvements to the Sublet Premises without the prior consent of
Sublessor. Sublessor's approval of the Drawings in accordance with Section 3
hereof shall be considered "prior consent" to the Work for purposes of this
section. All alterations, installations, removals and restoration shall be
performed in a good and workmanlike manner so as not to damage or alter the
primary structure or structural qualities of the Building and other
improvements situated on the Sublet Premises or of which the Sublet Premises
area a part. All alterations, installations, removals and restoration shall in
addition be subject to the requirements of Section 3 hereof (with the exception
of the payment of the Allowance, which is a one-time Allowance payable only in
connection with the Work). All alterations, additions or improvements to the
Sublet Premises, including the Work, shall, at Sublessor's sole discretion,
either be removed by Subtenant prior to the end of the Term or earlier
termination thereof, or shall remain on the Premises at the end of the Term.
5. Use. Subtenant shall occupy and use the Premises only for research
and development and general office purposes and otherwise in strict compliance
with the allowable uses set forth in Section 5 of the Main Lease. Subtenant
shall not commit or suffer to be
3
8
committed any annoyance, waste, nuisance or any act or thing which is against
public policy, or which may disturb the quiet enjoyment of Sublessor or any
other tenant or occupancy of the Building. Subtenant agrees not to deface or
damage the Building in any manner. Subtenant shall not use the Premises for any
unlawful purposes.
6. Subordinate to Main Lease. This Sublease is and shall be subject and
subordinate to the Main Lease. A copy of the Main Lease (from which certain
economic terms have been excised) is attached hereto as Exhibit A and made a
part hereof. Sublessor agrees that it will not voluntarily enter into any
agreement with Overlandlord which would result in the termination of the Main
Lease prior to the Expiration Date or which would negatively affect the rights
or obligations of Subtenant under this Sublease. Sublessor shall notify
Subtenant of any involuntary change.
7. Compliance with Main Lease. Except as set forth in the immediately
succeeding sentence, the terms, covenants and conditions of the Main Lease (the
"Incorporated Provisions") are incorporated herein by reference. Sections 1, 2,
3, 4, 6, 7(B), 8, 9, 15, 16(E), 17(E), 22, 23, 44 and 52 and Xxxxxxxx X, X, X,
X, X, X and I of the Main Lease are specifically excluded from the Incorporated
Provisions. Except to the extent that the Incorporated Provisions are
inapplicable or are modified by the provisions of this Sublease, the
Incorporated Provisions binding or inuring to the benefit of the landlord
thereunder shall, in respect of this Sublease, bind or inure to the benefit of
Sublessor, and the Incorporated Provisions, binding or inuring to the benefit
of the tenant thereunder shall, in respect of this Sublease, bind or inure to
the benefit of Subtenant with the same force and effect as if such Incorporated
Provisions were completely set forth in this Sublease, and as if the words
"Landlord" and "Tenant" or words of similar import, wherever the same appear in
the Incorporated Provisions, were construed to mean, respectively, "Sublessor"
and "Subtenant" in this Sublease, and as if the words "Premises," or words of
similar import, wherever the same appear in the Incorporated Provisions, were
construed to mean "Premises" in this Sublease, and as if the word "Lease," or
words of similar import, wherever the same appear in the Incorporated
Provisions, were construed to mean this "Sublease."
(a) The time limits contained in the Main Lease for the giving of
notices, making the demands or performing of any act, condition or covenant
on the part of the tenant thereunder, or for the exercise by the tenant
thereunder of any right, remedy or option, are changed for the purposes of
incorporation herein by reference by shortening the same in each instance
by 5 days, so that in each instance Subtenant shall have 5 days less time
to observe or perform hereunder than Sublessor has as the tenant under the
Main Lease, except that:
(i) any such time limits which are 7 days or less shall instead
by shortened in each instance by 3 business days, and
(ii) any such time limits which are 3 days or less shall instead
by shortened in each instance so that such time limits shall expire 1
business day prior to the expiration of such time limits under the
Main Lease.
(b) If any of the express provisions of this Sublease shall conflict
with any of the Incorporated Provisions, such conflict shall be resolved in
every instance in favor of the express provisions of this Sublease. If
Subtenant receives any notice or demand form Overlandlord under the Main
Lease, Subtenant shall deliver a copy thereof to Sublessor by overnight
courier the next business day or as soon thereafter as is reasonably
possible but in no event later than two business days after Subtenant's
receipt of such notice. If
4
9
Sublessor receives any notice of default from Overlandlord under the Main
Lease, Sublessor shall deliver a copy thereof to Subtenant by overnight
courier the next business day or as soon thereafter as is reasonably
possible but in no event later than two business days after Sublessor's
receipt of such notice.
8. Performance by Sublessor. Sublessor shall not be required to furnish,
supply or install anything required under any article of the Main Lease.
Sublessor shall have no liability or responsibility whatsoever for
Overlandlord's failure or refusal to perform under the Incorporated Provisions.
Subtenant shall have the right to instruct Overlandlord with respect to the
performance by Overlandlord of Overlandlord's obligations as landlord under
their Main Lease. Upon Sublessor's receipt of a written notice from Subtenant
that Sublessor has filed to perform an obligation under the Incorporated
Provisions, (because of a failure of Overlandlord to perform its obligation
under the Main Lease) then Sublessor may, at its sole and exclusive option
either (a) use its reasonable efforts to cause Overlandlord to observe and
perform the same, provided, however, that Sublessor does not guarantee
Overlandlord's compliance with the Incorporated Provisions, or (b) direct
Subtenant to pursue its claim directly against Overlandlord which shall be done
at Subtenant's sole cost and expense. Subtenant shall not in any event have any
rights in respect of the Premises greater than Sublessor's rights under the Main
Lease. Notwithstanding any provision to the contrary contained herein, as to
Incorporated Provisions, Sublessor shall not be required to make any payment or
perform any obligation, and Sublessor shall have no liability to Subtenant for
any matter whatsoever, except for (i) Sublessor's obligation to pay the rent due
under the Main Lease, and (ii) Sublessor's obligation to use reasonable efforts,
upon the written request of Subtenant, to cause Overlandlord to observe and/or
perform its obligations under the Main Lease (or, in the alternative, to direct
Subtenant to pursue its claim against Overlandlord). Sublessor shall not be
responsible for any failure or interruption, for any reason whatsoever, of the
services or facilities that may be appurtenant to or supplied at the Building,
by Overlandlord or otherwise, including, without limitation, heat, air
conditioning, water elevator service and cleaning service, if any; and no
failure to furnish, or interruption of, any such services or facilities shall
give rise to any; (i) abatement, diminution or reduction of Subtenant's
obligations under this Sublease; (ii) constructive eviction, whether in whole or
in part; or (iii) liability on the part of Sublessor.
9. No Breach of Main Lease. Subtenant shall not do or permit to be done
any act or thing which may constitute a breach or violation of any term,
covenant or condition of the Main Lease.
10. No Privity of Estate. Nothing contained in this Sublease shall be
construed to create privity of estate or privity of contract between Subtenant
and Overlandlord.
11. Indemnity. Subtenant hereby does and shall indemnify, defend and hold
harmless Sublessor from and against all losses, costs, damages, expenses and
liabilities, including, without limitation, reasonable attorneys' fees, which
Sublessor may incur or pay by reason of: (i) Subtenant's use, occupancy or
management of the Premises; (ii) any accidents, damages or injuries to persons
or property occurring in, on or about the Premises; (iii) any breach or default
hereunder on Subtenant's part; (iv) any work done by or on behalf of Subtenant
in or to the Premises; (v) the breach or inaccuracy of any representation or
warranty made by Subtenant hereunder; or (vi) any act, omission or negligence
occurring in, on or about the Premises on the part of Subtenant and/or its
officers, employees, agents, customers, invitees or any person claiming through
or under Subtenant.
5
10
12. Rent.
(a) Subtenant shall pay to Sublessor base rent (the "Base Rent") as
follows:
PERIOD MONTHLY RENT PER SQUARE FOOT MONTHLY RENT ANNUAL RENT
------ ---------------------------- ------------ -----------
July 1, 1998 - June 30, 1999 $ 2.85 $ 148,727.25 $ 1,784,727.00
July 1, 1999 - June 30, 2000 $ 2.96 $ 154,467.60 $ 1,853,611.20
July 1, 2000 - June 30, 2001 $ 3.08 $ 160,729.80 $ 1,928,757.60
July 1, 2001 - June 30, 2002 $ 3.20 $ 166,992.00 $ 2,003,904.00
July 1, 2002 - June 30, 2003 $ 3.33 $ 173,776.05 $ 2,085,312.60
(b) Subtenant shall pay the Monthly Base Rent to Sublessor in advance of
the first day of each month during the Term at the offices of Sublessor
identified at the beginning of this Sublease or elsewhere as Sublessor shall
direct. Subtenant shall pay to Sublessor the first installment of Monthly
Base Rent upon Subtenant's execution of this Sublease. In addition to the
Monthly Base Rent, Subtenant shall also be responsible for and pay the
applicable material or service provider (including as the case may be, Sublessor
or Overlandlord) directly for any and all other amounts payable with respect to
providing: (i) gas, heat, air conditioning, electricity, telephone, water,
sewer, security services and janitorial services to the Premises; and (ii)
Subtenant's Proportionate Share (as defined in the following sentence) of all
costs with respect to the Building's common area and systems, and the Building
structure, including without limitation costs of maintenance, repair and
replacement of the Building structure, common area and systems, costs of
utilities and security for the common areas and a property management fee to the
property manager selected by Sublessor or Overlandlord; and (iii) Subtenant's
Proportionate Share of any other operating expenses to be paid by Sublessor
under the Main Lease, including without limitation, the Impositions and
insurance costs. Subtenant's Proportionate Share shall be Sixty-Five and
one-half percent (65.5%). All of the foregoing amounts shall be hereinafter
collectively referred to as the "Additional Charges".
(c) "Rent" (which term shall include the Base Rent and any Additional
Charges) shall be paid promptly when due, without notice or demand therefor and
without deduction, abatement, counterclaim or setoff of any amount for any
reason whatsoever. Base Rent and Additional Charges shall be paid to Sublessor
by good unendorsed check of Subtenant at the address of Sublessor set forth at
the beginning of this Sublease or to such other person and/or at such other
address as Sublessor may from time to time designate by notice to Subtenant. No
payment by Subtenant or receipt by Sublessor of any lesser amount than the
amount stipulated to be paid hereunder shall be deemed other than on account of
the earliest stipulated Base Rent or Additional Charges due under this
Sublease; nor shall any endorsement or statement on any check or letter be
deemed an accord and satisfaction, and Sublessor may accept any check or
payment without prejudice to Sublessor's right to recover the balance due or to
pursue any other remedy available to Sublessor.
6
11
(d) Upon the execution of (i) this Sublease by both Sublessor and
Subtenant and (ii) consent to this Sublease by Overlandlord as provided
herein, Subtenant shall be authorized to take possession of the Premises
seven (7) days prior to the Commencement Date for the limited purpose of
installing its equipment. Subtenant hereby agrees that if Subtenant takes
possession of the Premises prior to the Commencement Date, then from and
after the date Subtenant takes possession of the Premises (the "Possession
Date"), all of Subtenant's obligations and duties under this Sublease shall
be effective. Notwithstanding anything in this Sublease to the contrary,
with the exception of the Allowance, Subtenant shall pay all charges
incurred by Subtenant (including but not limited to fees, if any, charged
by Overlandlord) in connection with Subtenant's relocation to the Premises,
the installation of all equipment and utility services for the Premises
which are required by Subtenant, including, but not limited to, telephones,
computers, and additional electric service.
13. Condition of Premises. Sublessor shall deliver the Premises to
Subtenant on the Commencement Date in "as is/where is" condition. Sublessor
shall have no obligations under this Sublease or otherwise to perform any work,
alterations, installations or to remove any asbestos or asbestos containing
material (collectively, "ACM"), if any, from the Premises or elsewhere.
Sublessor makes no representations or warranties whatsoever with respect to the
presence of ACM in the Premises. In making and executing this Sublease,
Subtenant has relied solely on such investigations, examinations and
inspections as Subtenant has chosen to make. Subtenant acknowledges that
Sublessor has afforded Subtenant the opportunity for full and complete
investigations, examinations, and inspections of the Premises.
14. Consents and Approvals. In any instance when Sublessor's consent or
approval is required under this Sublease, Sublessor's refusal to consent to or
approve any matter or thing shall be deemed reasonable and in good faith if
such consent or approval has not been obtained from Overlandlord; provided
however, Sublessor covenants to use reasonable efforts, at the sole cost and
expense of Subtenant (including, without limitation, reasonable attorneys' fees
and expenses), to obtain the consent or approval of Overlandlord and will
indicate to Overlandlord in those cases where its approval is conditioned upon
Overlandlord's approval that it has no objection thereto and agrees that if
such consent of Overlandlord shall not be required, Sublessor shall not
unreasonably withhold or delay its consent to such matter. In the event that
Subtenant shall seek the approval by or consent of Sublessor and Sublessor
shall fail or refuse to give such consent or approval, Subtenant shall not be
entitled to any damages from Sublessor for any withholding or delay of such
approval or consent by Sublessor.
15. Notice. All notices, consents, approvals, demands and requests which
are required or desired to be given by either party to the other hereunder
shall be in writing and shall be personally delivered, sent by telefax or by
reputable overnight courier delivery service or sent by United States
registered or certified mail and deposited in a United States post office,
return receipt requested and postage prepaid. Notices, consents, approvals,
demands and requests which are served upon Sublessor or Subtenant in the manner
provided herein shall be deemed to have been given or served for all purposes
hereunder on the day personally delivered or refused, the next business day
after sending by overnight courier as aforesaid, on the third business day
after mailing as aforesaid, or, if via telefax, on the date of transmission.
All notices, consents, approvals, demands, and requests given to Sublessor or
Subtenant shall be addressed to the address set forth at the beginning of this
Sublease with notices to Sublessor being addressed to the attention of the Vice
President - Real Estate with a copy at the same time and in the same manner to
Property Administration, First Data Card Services Group, 00000 Xxxxxxx Xxxxxx,
Xxxxx, XX 00000, Attention: Xxxxxx Xxxxxxx. Either party may from time to time
change the names and/or
7
12
addresses to which notices, consents, approvals, demands and requests shall be
addressed by a notice given in accordance with the provisions of this Paragraph.
16. Termination of Main Lease. If for any reason the term of the Main
Lease shall terminate prior to the Expiration Date, this Sublease shall
thereupon be terminated and Sublessor shall not be liable to Subtenant by
reason thereof unless both (a) Subtenant shall not then be in default
hereunder, and (b) said termination shall have been effected because of the
breach or default of Sublessor as tenant under the Main Lease.
17. Maintenance and Repairs. Subtenant shall, at Subtenant's sole cost
and expense, keep and maintain the Premises in good condition and repair,
including without limitation, all necessary maintenance and repairs to all
portions of the Premises and all exterior entrances, all glass, window
casements, show window moldings, all partitions, doors, doorjambs, door closers
and hardware fixtures exclusive of normal maintenance services. All damage or
injury to the Building and/or common areas in which the same are located,
caused by the negligence of Subtenant, its employees, agents or visitors, shall
be repaired by Subtenant at Subtenant's sole cost and expense. Subtenant shall
promptly replace any portion of the Premises which cannot be fully repaired,
regardless of whether the benefit of such replacement extends, beyond the Term.
It is the intention of Sublessor and Subtenant that, at all times during the
Term, Subtenant shall, at its cost, maintain the Premises in compliance with
all applicable laws and in the same condition as existed upon the Commencement
Date of the Sublease, reasonable wear and tear excepted. Notwithstanding the
foregoing, Sublessor hereby agrees to perform the repair obligations for the
Building as described in Section 7(A) of the Main Lease and Subtenant agrees
to reimburse Sublessor for its Proportionate Share of such repair costs after
the opportunity to review Sublessor's receipts for such repair costs. The cost
of any repair which is capital in nature shall be amortized on a straight line
basis over its useful life ("Useful Life") at an interest rate not to exceed ten
percent (10%) and Subtenant shall reimburse Sublessor the amount equal to
Subtenant's Proportionate Share of the annualized amortization during the Term
of this Sublease. The Useful Life of a capital item shall be determined using
the United States Internal Revenue Service standard depreciation schedule in
effect on the date that the applicable capital expenditure is made. Subtenant
shall also reimburse Subtenant's Proportionate Share of the annualized
amortization of any improvement or replacement which is capital in nature,
provided that the item is intended to result in a cost savings, then only to the
extent of saving actually realized. Subtenant shall not be required to reimburse
Sublessor for any changes, alterations or improvements to any portion of the
Building first required by any law or regulation prior to the Term Commencement
Date, to the extent not attributable to Subtenant's use and occupancy of the
Premises.
18. Assignment and Subletting. Subtenant shall not, by operation of law,
merger, consolidation or otherwise, assign, sell, mortgage, pledge or in any
manner transfer this Sublease or any interest therein, or sublet the Premises
or any part or parts thereof, or grant any concession or license or otherwise
permit occupancy of all or any part of the Premises by any person, except with
the prior written consent of Sublessor. Sublessor shall not unreasonably
withhold its consent to an assignment of this Sublease by Subtenant (which
assignment may nevertheless require the consent of Overlandlord), provided that
the assignee proposed by Subtenant shall demonstrate to the reasonable
satisfaction of Sublessor that such proposed assignee has a net worth and
financial capacity equal to or greater than the net worth and financial capacity
of Subtenant. Neither the consent of Sublessor to an assignment, subletting,
concession or license, nor the references in this Sublease to assignees,
subtenants, concessionaires or licensees, shall in any way be construed to
relieve Subtenant of the requirement of obtaining the consent of
8
13
Sublessor to any further assignment, subletting, concession or license for all
or any part of the Premises. In the event Sublessor consents to any assignment
of this Sublease, the assignee shall execute and deliver to Sublessor an
agreement in form and substance satisfactory to Sublessor whereby the assignee
shall assume all of Subtenant's obligations under this Sublease from and after
the date of the assignment. Notwithstanding any assignment or subletting,
including, without limitation, any assignment or subletting permitted or
consented to, the original Subtenant named herein and any other person(s) who
at any time was or were Subtenant shall remain fully liable on this Sublease,
and if this Sublease shall be amended, modified, extended or renewed, the
original Subtenant named herein and any other person(s) who at any time was or
were Subtenant shall remain fully liable on this Sublease as so amended,
modified, extended or renewed. Any violation of any provision of this Sublease
by any assignee, subtenant or other occupant shall be deemed a violation by the
original Subtenant named herein, the then Subtenant and any other person(s) who
at any time was or were Subtenant, it being the intention and meaning that the
original Subtenant named herein, the then Subtenant and any other person(s) who
at any time was or were Subtenant shall all be liable to Sublessor for any and
all acts or omissions of any and all assignees, subtenants and other occupants
of the Premises claiming by, through or under Subtenant. If this Sublease shall
be assigned or if the Premises or any part thereof shall be sublet or occupied
by any person or persons other than the original Subtenant named herein,
sublessor may collect rent from any such assignee and/or any subtenants or
occupants, and apply the net amounts collected to the Base Rent and Additional
Charges, but no such assignment, subletting, occupancy or collection shall be
deemed a waiver of any of the provisions of this Paragraph, or the acceptance
of the assignee, subtenant or occupant as Subtenant, or a release of any person
from the further performance by such person of the obligations of Subtenant
under this Sublease.
19. Insurance. Subtenant shall provide and maintain throughout the term
of this Sublease a policy or policies of comprehensive public liability
insurance in standard form naming Sublessor and Overlandlord as additional
insureds and otherwise complying with Section 17 of the Main Lease with limits
of not less than $2,000,000.00 combined single limit for both bodily injury or
death and for property damage, including water damage. A policy, binder or
other reasonable satisfactory evidence of such insurance shall be delivered to
Sublessor by Subtenant no less than ten (10) days before the Possession Date.
Subtenant shall procure and pay for renewals or replacements of such insurance
from time to time before the expiration thereof, and Subtenant shall deliver to
Sublessor such renewal or replacement policy or binder or other reasonably
satisfactory evidence of such insurance at lease 30 days before the expiration
of any existing policy. All such policies shall be issued by companies licensed
to do business in the State of California and shall contain a provision whereby
the same cannot be cancelled or modified unless Sublessor is given at least 30
days' prior written notice by certified or registered mail of such cancellation
or modification.
20. Right to Cure Subtenant's Defaults and Damages. If Subtenant shall at
any time fail to make any payment or perform any other obligation of Subtenant
hereunder within the applicable cure period, if any, then Sublessor shall have
the right, but not the obligation, after five days' notice to Subtenant, or
without notice to Subtenant in the case of any emergency, and without waiving
or releasing Subtenant from any obligations of Subtenant hereunder, to make
such payment or perform such other obligation of Subtenant in such manner and
to such extent as Sublessor shall deem necessary, and in exercising any such
right, to pay any incidental costs and expenses, employ attorneys, and incur and
pay reasonable attorneys' fees. Subtenant shall pay to sublessor upon demand
all sums so paid by Sublessor and all incidental costs and expenses of
Sublessor in connection therewith, together with interest thereon at the rate
of 2% per calendar month or any part thereof or the then maximum rate of
interest which may lawfully
9
14
be collected from Subtenant, whichever shall be less, from the date of the
making of such expenditures.
21. Remedies of Sublessor.
(a) "Default" shall mean a default by Subtenant under any provision
of this Sublease which default has not been cured within any applicable
grace or cure period.
(b) If a Default occurs, Sublessor shall have, in addition to all its
rights and remedies contained in the Incorporated Provisions pursuant to
Section 4 hereof, the following rights and remedies; all of Sublessor's
rights and remedies under this Sublease are distinct, separate and
cumulative, and none will exclude any other right or remedy allowed by law:
(i) Sublessor may, with or without notice of such election and
with or without entry or other action by Sublessor, immediately
terminate this Sublease, in which event the Term of this Sublease
shall end and all right, title, and interest of Subtenant hereunder
shall expire; or
(ii) Sublessor may enforce the provisions of this Sublease and
may enforce and protect the rights of the Sublessor hereunder by a
suit or suits in equity or at law for the specific performance of any
covenant or agreement herein or for the enforcement of any other
appropriate legal or equitable remedy, including the recovery of all
moneys due or to become due under any of the provisions of this
Sublease.
(c) If Sublessor elects to terminate Subtenant's right to possession
only without terminating this Sublease, Sublessor, at Sublessor's option,
may enter into the Premises, remove Subtenant's signs and other evidences
of tenancy, and take and hold possession thereof without such entry and
possession terminating this Sublease or releasing Subtenant, in whole or in
part, from Subtenant's obligation to pay Rent under this Sublease for the
full Term, and in the case Sublessor elects to terminate the Sublease or to
terminate possession only, Subtenant will immediately pay to Sublessor, if
Sublessor so elects, a sum equal to the then present value (as defined in
the following sentence) of the entire amount of the Rent specified in
Section 9 of this Sublease for the remainder of the Term, plus any other
sums then due under this Sublease, less the fair rental value of the
Premises for such period. In calculating this sum, present value shall be
computed on the basis of a discount rate of six percent per annum. In the
alternative, upon and after entry into possession without termination of
the Sublease, Sublessor will use its best efforts to relet all or any part
of the Premises for Subtenant's account for such rent and for such time and
upon such terms as Sublessor in Sublessor's sole discretion may determine.
Sublessor will not be required to observe any instruction given by
Subtenant about such reletting. Subtenant will, upon demand, pay the cost
of Sublessor's expenses of the reletting. If the consideration collected by
Sublessor upon any such reletting for Subtenant's account is not sufficient
to pay monthly the full amount of the Rent due under this Sublease,
together with the costs of Sublessor's expenses, Subtenant will pay to
Sublessor the amount of each monthly deficiency upon demand.
(d) Subtenant will pay upon demand all of Sublessor's costs,
charges, and expenses, including reasonable attorneys' fees, and fees and
expenses of agents and
10
15
others retained by Sublessor in any litigation, negotiation, or transaction
in which Sublessor seeks to enforce the terms or provisions of this
Sublease.
22. Brokerage. Sublessor and Subtenant each represents to the other that
except for the Staubach Company ("Sublessor's Broker") and Colliers Xxxxxxx
International, Inc. ("Subtenant's Broker") (collectively, the "Sublease
Brokers"), no broker or other person had any part, or was instrumental in any
way, in bringing about this Sublease. Sublessor agrees to pay the Sublessor's
Broker for services rendered in connection with this Sublease pursuant to the
Agreement (the "Broker Agreement") between Sublessor and the Sublessor's
Broker. By its execution hereof Sublessor's Broker agrees to pay Subtenant's
Broker one-half of Sublessor's Broker's commission. Sublessor and Subtenant
each agree to indemnify, defend and hold harmless the other from and against,
any claims made by any broker or any person, other than the Sublease Brokers,
for a brokerage commission, finder's fee, or similar compensation, by reason of
or in connection with this Sublease, and any loss, liability, damage, cost and
expense (including, without limitation, reasonable attorneys' fees) in
connection with such claims if such broker or other person had, or claimed to
have, dealings with such party in bringing about this Sublease. The provisions
of this Paragraph 22 shall survive the expiration or termination of this
Sublease.
23. Waiver of Jury Trial and Right to Counterclaim. Subtenant hereby
waives all right to trial by jury in any summary or other action, proceeding or
counterclaim arising out of or in any way connected with this Sublease. With
the exception of any compulsory counterclaims, Subtenant also hereby waives all
right to assert or interpose a counterclaim in any summary proceeding or other
action or proceeding to recover or obtain possession of the Premises unless
legally required to do so to preserve the claim.
24. No Waiver. The failure of Sublessor to insist in any one or more
cases upon the strict performance or observance of any obligation of Subtenant
hereunder or to exercise any right or option contained herein shall not be
construed as a waiver or relinquishment for the future of any such obligation
of Subtenant or any right or option of Sublessor. Sublessor's receipt and
acceptance of Base Rent or Additional Charges, or Sublessor's acceptance of
performance of any other obligation by Subtenant, with knowledge of Subtenant's
breach of any provision of this Sublease, shall not be deemed a waiver of such
breach. No waiver by Sublessor of any term, covenant or condition of this
Sublease shall be deemed to have been made unless expressed in writing and
signed by Sublessor.
25. Complete Agreement. There are no representations, agreements,
arrangements or understandings, oral or written, between the parties relating
to the subject matter of this Sublease which are not fully expressed in this
Sublease. This Sublease cannot be changed or terminated orally or in any other
manner other than by a written agreement executed by both parties.
26. Successors and Assigns. The provisions of this Sublease, except as
herein otherwise specifically provided, shall extend to, bind and inure to the
benefit of the parties hereto and their respective personal representatives,
heirs, successors and permitted assigns. In the event of any assignment or
transfer of the leasehold estate under the Main Lease, the transferor or
assignor, as the case may be, shall be and hereby is entirely relieved and
freed of all obligations under this Sublease arising after the date of any such
assignment or transfer, except that Sublessor shall not be relieved and freed
of its payment obligations to Overlandlord under the Main Lease which payment
obligations are greater than the payment obligations of Subtenant to Sublessor
hereunder unless Overlandlord and Sublessor otherwise agree.
11
16
27. INTERPRETATION. Irrespective of the place of execution or performance,
this Sublease shall be governed by and construed in accordance with the laws of
the state where the Premises is located. If any provision of this Sublease or
the application thereof to any person or circumstance shall, for any reason and
to any extent, be invalid or unenforceable, the remainder of this Sublease and
the application of that provision to other persons or circumstances shall not be
affected but rather shall be enforced to the extent permitted by law. The table
of contents, captions, headings and titles, if any, in this Sublease are solely
for convenience of reference and shall not affect its interpretation. This
Sublease shall be construed without regard to any presumption or other rule
requiring construction against the party causing this Sublease to be drafted.
Each covenant, agreement, obligation or other provision of this Sublease shall
be deemed and construed as a separate and independent covenant of the party
bound by, undertaking or making same, not dependent on any other provision of
this Sublease unless otherwise expressly provided. All pronouns and any
variations thereof shall be deemed to refer to the masculine, feminine or
neuter, singular or plural, as the identity of the parties may require. The
word "person" as used in this Sublease shall mean a natural person or persons, a
partnership, a corporation or any other form of business or legal association or
entity. This Sublease may be executed in counterparts or with counterpart
signature pages.
28. CONSENT OF LANDLORD UNDER MAIN LEASE. This Sublease shall not be
operative or effective for any purpose whatsoever unless and until Overlandlord
shall have given its written consent as provided hereto and any conditions
precedent with respect to such consent have been satisfied or waived.
Sublessor shall have no obligation to satisfy any such conditions precedent
provided, however, that Subtenant may, but shall not be obligated to, satisfy
any such conditions precedent and Sublessor shall reasonably cooperate with
Subtenant (at no cost or expense to Sublessor) in this regard.
29. HOLDING OVER. Subtenant shall pay Sublessor a sum for each day that
Subtenant retains possession of the Premises or any part thereof after
termination of this Sublease, by lapse of time or otherwise, equal to two (2)
times the Rent payable hereunder, and Subtenant shall also pay damages
consequential as well as direct, sustained by Sublessor by reason of such
retention. Nothing in this Section contained, however, shall be construed or
operate as a waiver of Sublessor's right of reentry or any other right of
Sublessor under this Sublease or of Overlandlord under the Main Lease.
30. SECURITY DEPOSIT. Subtenant agrees to deposit with Sublessor, upon
the execution of this Sublease, $297,454.50 in cash (the "Cash Security
Deposit") and $594,909.00 in the form of an irrevocable letter of credit issued
by a bank acceptable to Sublessor in form and substance satisfactory to
Sublessor (the "Letter of Credit")(the "Cash Security Deposit" and the "Letter
of Credit" are sometimes hereinafter collectively referred to as the "Security
Deposit"), which Security Deposit is security for the full and faithful
performance by Subtenant of every term, provision, covenant, and condition of
this Sublease. The Cash Security Deposit will be held by Sublessor, provided
however, that Sublessor will have no obligation to segregate the amount from
Sublessor's other funds. Upon the occurrence of a Default by Subtenant in
respect to any of the terms, provisions, covenants, or conditions of this
Sublease, including, but not limited to, payment of Rent, Sublessor may use,
apply, or retain the whole or any part of the Cash Security Deposit so
deposited for the payment of any such Rent in default, or for any other sum
which Sublessor may expend or be required to expend by reason of Subtenant's
Default, including, without limitation, any damage or deficiency in the
reletting of the Premises, whether such damage or deficiency accrued before or
after any reentry by Sublessor. If any of the Cash Security Deposit is so
used, Subtenant, on written demand by Sublessor, will promptly pay to Sublessor
such additional sum as may be necessary to restore the deposit to the original
amount
12
17
set forth in this Section 30. In addition, upon the occurrence of a Default by
Subtenant in respect to any of the terms, provisions, covenants or conditions of
this Sublease, including, but not limited to, payment of Rent, Sublessor may
also draw on the Letter of Credit and apply such amount to the payment of any
sum in default or any other sum which Sublessor may require or deem necessary to
spend or incur by reason of Subtenant's default. In such event, Subtenant shall,
upon demand, increase the Letter of Credit by the amount so applied to replenish
the Letter of Credit. Notwithstanding the foregoing, in the event of a
nonmonetary Default by Subtenant, Sublessor shall give Subtenant 48 hours
advance written notice prior to using any portion of the Security Deposit. The
Letter of Credit shall be payable to Sublessor or its successors and assigns and
have an expiration date no earlier than the one-year anniversary of the
Commencement Date and be automatically renewable for consecutive one year
periods through and including the Expiration Date. If not renewed at least
thirty (30) days prior to the end of each such one-year period, Sublessor shall
be permitted to draw the full amount of the Letter of Credit. The Letter of
Credit shall expressly provide, among other things, that Sublessor may draw
under it by presentation of a sight draft and a written certification by
Sublessor that Sublessor is then entitled to draw the amount of the draft.
Sublessor's right to draw upon the Cash Security Deposit and/or the Letter of
Credit shall be cumulative, and Sublessor shall be entitled to draw upon either
or both, and shall not be required to deplete either portion of the Security
Deposit before proceeding to draw on the other portion of the Security Deposit.
Provided Subtenant is not in material default of this Sublease, the principal
sum of the Letter of Credit shall be reduced by fifty (50%) on the first day of
the thirteenth (13th) month of the Sublease Term. If Subtenant fully and
faithfully complies with all of the terms, provisions, covenants, and conditions
of this Sublease, the Cash Security Deposit, or any balance thereof will be
returned to Subtenant after the last to occur of the following:
(a) the time fixed as the expiration of the Term of this Sublease;
(b) the surrender of the Premises by Subtenant to Sublessor in
accordance with this Sublease;
(c) the receipt of Sublessor of all sums due pursuant to the
Sublease.
Except as otherwise required by law, Subtenant will not be entitled to any
interest on such Cash Security Deposit.
31. Counterparts. This Sublease may be executed in two or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute but one and the same instrument.
32. No offer. The submission of this Sublease shall not be deemed to be
an offer, an acceptance, or a reservation of the Premises; and Sublessor shall
not be bound hereby until Sublessor has delivered to Subtenant a fully executed
copy of this Sublease, signed by both of the parties on the last page of this
Sublease in the spaces herein provided. Until such delivery, Sublessor reserves
the right to exhibit and lease the Premises to other prospective tenants.
33. Hazardous Materials. Subtenant shall comply with any and all EnvLaws.
Subtenant shall not: (a) cause, permit or allow the presence of any Hazardous
Substance on the Premises, or (b) conduct or authorize the use, generation,
release, transportation, storage, treatment or disposal of Hazardous Substances
at the Premises.
34. Signage. Subject to the prior consent of Sublessor and Overlandlord
and provided all such signage complies with all applicable governmental laws,
ordinances, rules or
13
18
regulations, does not cause any structural damage or other damage to the
Building, does not violate any existing restrictions affecting the Building, and
is compatible with the architecture of the Building and the landscaped are
adjacent thereto, Subtenant shall have the right to install, as Subtenant's sole
cost and expense: (a) door signage at the entrance to the Premises; and (b) a
monument sign and directional signage. Subtenant shall remove all signage from
the Premises at the end of the Term.
35. Parking. Subtenant shall have the non-exclusive right to the parking
spaces allocated to the Premises at a ratio of approximately 4 parking space
to 1,000 rentable square feet of Premises at no additional charge. Subtenant,
its agents, employees, invitees and contractors shall comply with Building
rules and regulations applicable to use of the parking areas.
36. [OMITTED]
37. Rules and Regulations; Common Areas. Subtenant shall comply with all
reasonable rules and regulations and all subsequent amendments and
modifications established by Sublessor or Overlandlord with respect to the
Building and common areas thereof, and shall cause its employees, customers,
contractors, agents and invitees to so comply. Without liability to Subtenent
and without effecting an eviction or disturbance of Subtenant's use or
possession or giving rise to any claim for set-offs or abatement of Rent, and
without imposing any obligation on Sublessor or Overlandlord to undertake any
of the same, Sublessor (or Overlandlord, as the case may be) shall have the
right to: (a) make changes, repairs, additions or alterations to the common
areas of the Building, including without limitation changes in the location,
size, shape and number of driveways, entrances, parking areas, loading areas,
ingress/egress, direction of traffic, landscaped areas and walkways and changes
in the arrangement or location of entrances or passageways, doors and doorways,
corridors, stairs, toilets or other public parts of the Building; (b) close any
of the common areas for maintenance purposes, including entrances, doors,
corridors or other facilities; (c) perform any acts related to the safety,
protection, preservation, reletting or improvement of the Building; (d) change
the name or street address of the Building or suite number of the Premises;
(e) to require all persons entering or leaving the Building to identify
themselves to security personnel by registration or otherwise; and (f) to close
the Building after-hours and on week-ends.
14
19
IN WITNESS WHEREOF, Sublessor and Subtenant have executed this Sublease as
of the day and year first above written.
SUBLESSOR: FIRST DATA MERCHANT SERVICES CORPORATION, a Florida
corporation
By: /s/ XXXXX XXXXXXXXXX
--------------------------------------------------------
Name: Xxxxx Xxxxxxxxxx
------------------------------------------------------
Title: Assistant Secretary
-----------------------------------------------------
SUBTENANT: XXXXXXXX.XXX CORPORATION, a California corporation
By: /s/ XXXXXXX X. XXXXXXXX
--------------------------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
------------------------------------------------------
Title: CFO
-----------------------------------------------------
The undersigned Sublease Brokers join in this Lease for purposes of agreeing to
be bound by the provisions of Paragraph 22 hereof.
THE STABAUCH COMPANY XXXXXXX'X PARISH INTERNATIONAL, INC.
By: /s/ XXXXXXX XXXXXXXX By: /s/ XXXXXX XXXXXXXX
---------------------------- ----------------------------
Name: Xxxxxxx Xxxxxxxx Name: Xxxxxx Xxxxxxxx
-------------------------- --------------------------
Title: President, NW Corp Svcs Title: Senior Vice President
------------------------- -------------------------
15
20
ACKNOWLEDGED AND CONSENTED TO:
Sunnyvale Partners Limited Partnership, landlord under the Main Lease,
hereby consents to the sublease of the Premises described in the foregoing
Sublease and confirms that the consent given hereby satisfies the requirements
for landlord's consent of the subletting of the Premises set forth in the Main
Lease.
SUNNYVALE PARTNERS LIMITED PARTNERSHIP
By: /s/ XXXXX XXXXXXX
----------------------------------------
Name: Xxxxx Xxxxxxx
--------------------------------------
Title: President, Ridge Sunnyvale, Inc.
-------------------------------------
16
21
EXHIBIT A
THE MAIN LEASE
17
22
BUILD-TO-SUIT LEASE AGREEMENT
Landlord: SUNNYVALE PARTNERS LIMITED PARTNERSHIP
Tenant: FIRST DATA MERCHANT SERVICES CORPORATION
March 18, 1997
23
TABLE OF CONTENT
1. Description......................................................................1
2. Term and Occupancy...............................................................1
3. Rent.............................................................................2
4. Construction.....................................................................3
5. Use..............................................................................7
6. Condition of Demised Premises....................................................8
7. Maintenance and Repairs..........................................................8
8. Alterations......................................................................9
9. Signs...........................................................................11
10. Services........................................................................11
11. Compliance with Law.............................................................12
12. Landlord's Title, Authority, and Quiet Enjoyment; Tenant's Authority............13
13. Subordination...................................................................13
14. Assignment and Sublease.........................................................14
15. Lease Extension.................................................................15
16. Impositions.....................................................................16
17. Insurance.......................................................................18
18. Destruction and Restoration.....................................................20
19. Condemnation....................................................................22
20. Default by Tenant...............................................................26
21. Landlord's Remedies.............................................................27
22. Default by Landlord.............................................................28
23. Tenant's Remedies...............................................................28
i
24
24. Delivery of Executed Lease......................................................29
25. Termination.....................................................................29
26. Notices.........................................................................29
27. Brokerage.......................................................................30
28. Estoppel........................................................................30
29. Hazardous Substances............................................................30
30. Holdover........................................................................32
31. Surrender.......................................................................32
32. Liens...........................................................................33
33. Interest; Late Charges..........................................................34
34. Inspections.....................................................................34
35. Transfer of Landlord's Interest.................................................34
36. Indemnity.......................................................................35
37. Modification of Lease...........................................................35
38. Memorandum of Lease.............................................................36
39. Paragraph Captions..............................................................36
40. Entire Agreement................................................................36
41. Choice of Law and Interpretation................................................36
42. Prevailing Party................................................................36
43. Exhibits........................................................................36
44. Guarantee.......................................................................37
45. Independent Covenants...........................................................37
46. Entry by Landlord...............................................................37
47. [Deleted by intent of parties.].................................................37
48. Survival of Obligations.........................................................37
ii
25
49. Lease Subject to Landlord's Acquisition of Demised Premises.....................38
50. Americans With Disabilities Act.................................................38
51. Reports by Tenant...............................................................39
52. Option to Purchase..............................................................39
53. No Third Party Beneficiaries....................................................41
54. Counterparts....................................................................41
55. Consents and Approvals..........................................................41
56. Limitation on Damages...........................................................41
57. Tenant's Property...............................................................41
Exhibit A - Legal Description
Exhibit B - Site Plan
Exhibit C - Plans
Exhibit C-1 - Construction Schedule
Exhibit D - Schedule of Rents
Exhibit E - Lease Term Agreement
Exhibit F - Memorandum of Lease
Exhibit G - Landlord's Development Costs
Exhibit H - Permitted Exceptions
Exhibit I - Escrow Agreement
iii
26
THIS BUILD-TO-SUIT LEASE AGREEMENT (this "Lease") is made as of the 18th
day of March, 1997 (the "date hereof") between SUNNYVALE PARTNERS LIMITED
PARTNERSHIP, an Illinois limited partnership, having its principal office at c/o
Ridge Sunnyvale, Inc, c/o Ridge Capital Corporation, 000 Xxxx Xxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000 (hereinafter referred to as "Landlord"), and FIRST
DATA MERCHANT SERVICES CORPORATION, having its principal office at 0000 Xxx
Xxxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxx 00000 (hereinafter referred to as
"Tenant").
WITNESSETH:
Landlord, for and in consideration of the rents, covenants and agreements
hereafter set forth on the part of Tenant to be paid, kept, observed and
performed does hereby lease unto Tenant, and Tenant does hereby take subject
to the conditions herein expressed, all that parcel of land situated in the
City of Sunnyvale, County of Santa Xxxxx, State of California and legally
described in Exhibit A attached hereto and made a part hereof (the "Land"),
together with all improvements located and to be constructed thereon by
Landlord, which are hereinafter called "Landlord's Improvements." Landlord's
Improvements and all improvements, machinery, building equipment, fixtures and
other property of Landlord, real, personal or mixed (except Tenant's trade
fixtures and any other property of Tenant), installed or located thereon,
together with all additions, alterations and replacements thereof are
collectively referred to herein as the "Improvements." The Land and the
Improvements are sometimes hereinafter collectively referred to as the "Demised
Premises." The structure located upon and being a part of the Demised Premises
which is constructed to be used as a two story office building containing
approximately 80,000 "useable square feet" (as defined in Paragraph 4 below) us
hereinafter referred to as the "Building".
1. Description. Landlord will cause Landlord's Improvements (including
the Building and other site improvements depicted on the Site Plan attached
hereto and made a part hereof as Exhibit B) to be constructed in substantial
accordance with the plans and specifications enumerate on Exhibit C (the
"Plans"). Landlord agrees that Landlord shall not make any modifications or
changes to the Plans without Tenant's prior written consent. Landlord further
agrees to make any changes to the Plans requested by Tenant in writing and if
the change requested by Tenant increases or decreases the cost of the Demised
Premises, the Base Rent provided for herein shall be adjusted in accordance
with the provisions of the formula provided on Exhibit D.
2. Term and Occupancy. A. The term of this Lease shall commence on the
Construction Completion Date, as provided in Paragraph 4 below (hereinafter
referred to as the "Commencement Date"), and shall end on the date which is the
last day of the month that includes the twelfth (12th) anniversary of the
Commencement Date (hereinafter referred to as the "Expiration Date"), unless
the term be extended or earlier terminated as provided herein.
Landlord shall notify Tenant of the anticipated Construction Completion
Date. Landlord agrees to notify Tenant promptly from time to time of any
changes in the anticipated Construction Completion Date. Tenant shall have the
right to enter the Demised Premises during the approximately ninety (90) day
period preceding the Construction Completion Date for the purpose of installing
its equipment and Tenant does hereby agree to assume all risk of loss or
27
damage to such equipment, and to indemnify, defend and hold harmless Landlord
from and against any loss or damage to such equipment and all liability, loss or
damage arising from any injury to the property of Landlord, or its contractors,
subcontractors or materialmen, and any death or personal injury to any person or
persons arising out of such installation. Landlord agrees to cooperate with
Tenant so that Tenant's contractors and tradespeople will be permitted to
reasonably perform their work without material interference. Tenant agrees to
cooperate with Landlord so that Landlord's contractors and tradespeople will be
permitted to reasonably perform their work without material interference.
B. Notwithstanding anything else in this Lease to the contrary, Tenant
shall have the right to terminate this Lease as of the end of the eighth (8th)
Lease Year (the "Early Termination Date") provided that Tenant shall (a) notify
Landlord in writing of its election to terminate at least one (1) year prior to
the Early Termination Date, and (b) pay to the Landlord, concurrently with the
notification to Landlord hereunder, a termination fee by certified or cashier's
check or wire transfer of available funds ("Termination Amount") equal to the
discounted present value (using Landlord's financing interest rate) amount
needed to reduce the remaining unamortized principal balance due on the
indebtedness originally incurred by Landlord to finance the Landlord's
Development Costs (as defined in Paragraph 19F) to [omitted]. If Tenant gives
such notice as required hereunder and pays the Termination Amount concurrently
therewith, this Lease shall be deemed terminated as to all rights or obligations
hereunder (except such rights and obligations as Landlord and Tenant would
otherwise have upon normal expiration of the term of this Lease). Any such
notice hereunder, not accompanied by the Termination Amount as provided
hereinabove, shall be deemed invalid and of no force or effect. Upon Landlord's
closing on the permanent loan for the financing of the Landlord's Development
Costs, Landlord shall provide to Tenant a copy of the twenty (20) year permanent
loan amortization (the "Loan Amortization"), which shall include the principal
amount that will be due at the end of the eighth (8th) Lease Year.
Tenant shall have the right to pay the Termination Amount to any mortgagee
of the Demised Premises or other person with a lien on the Demised Premises or
the rents derived therefrom, but Tenant shall have no such obligation to do so
unless such obligation is specifically set forth in a non-disturbance or other
agreement between Tenant and such mortgagee or other lienholder. Notwithstanding
the foregoing, Tenant acknowledges and agrees that any payment to any such
mortgagee or other lienholder shall only be effectuated by a two-party or
two-payee certified or cashier's check, made payable to both Landlord and any
such mortgagee or other lienholder.
3. Rent. The annual base rental ("Base Rent") shall be calculated in
accordance with the provisions set forth on the Schedule of Rents attached
hereto and made a part hereof as Exhibit D. Base Rent shall be paid monthly, in
advance, in equal installments, without offset or deduction by wire transfer in
accordance with separate instruction given by Landlord to Tenant, on the
Commencement Date and on the first day of each month thereafter during the term
hereof; provided however, that if the term of this Lease shall commence on a
date other than the first day of a calendar month or end on a date other than
the last day of a calendar month (i) the first and last month's Base Rent shall
be prorated based upon the ratio that the number of days in the term within such
month bears to the total number of days in such month, and (ii) Base Rent
reserved for the calendar month of any scheduled rent escalation shall be
equitably adjusted upon due
2
28
consideration of the number of days in such month falling within the preceding
Lease Year (as herein defined) and the number of days in such month falling
within the current Lease Year. For purposes of this Lease, the term "Lease Year"
shall mean the 12-month period commencing on the Commencement Date and each
12-month period thereafter during the term of this Lease (and any renewal or
extension thereof), provided that, if the Commencement Date is not the first day
of a calendar month, the first "Lease Year" shall be the period commencing on
the Commencement Date and ending on the last day of the twelfth (12th) full
calendar month following the Commencement Date and all Base Rent payable for the
month in which the Commencement Date occurs shall be paid on the first day of
the following calendar month. Notwithstanding the foregoing, on or prior to the
date of closing under the Sale Agreement (as defined herein), Tenant shall also
deposit into escrow with First American Title Guaranty Company the sum of Two
Million Dollars ($2,000,000.00) to cover a portion of the Landlord's Development
Costs which shall be disbursed in accordance with the Escrow Agreement attached
hereto as Exhibit I.
4. Construction.
A. Landlord agrees, at Landlord's sole cost and expense, to cause
construction of Landlord's Improvements in accordance with the following
schedule:
(a) Landlord shall use all reasonable efforts to commence the Site
Preparation Phase (as defined in that certain Real Estate Purchase and
Sale Agreement and Joint Escrow Instructions dated March 18, 1997 (the
"Sale Agreement") between Regis Homes of Northern California, Inc. and
Landlord) as soon as possible following the date Landlord acquires the
Land and in any event on or before the date four (4) business days
following the date Landlord acquires the Land (the "Estimated Construction
Commencement Date"), in accordance with the Plans and in accordance with
the construction schedule attached hereto as Exhibit C.1 (the
"Construction Schedule") and shall diligently pursue construction in an
effort to complete Landlord's Improvements on or before the Estimated
Construction Completion Date (as herein defined); provided, however, if
delay is caused or contributed to by act or neglect of Tenant, or those
acting for or under Tenant including, without limitation, changes ordered
by Tenant, or delays caused by labor disputes, casualties, acts of God or
the public enemy, governmental embargo restrictions, shortages of fuel,
labor, or building materials, action or non-action of public utilities, or
of local, State or Federal governments affecting the work, or other
similar causes beyond the Landlord's reasonable control, then the time of
commencement of said construction shall be extended for the additional
time caused by such delay (such delays are each hereinafter referred to as
an "excused delay"). The date on which Landlord actually commences
construction of Landlord's Improvements shall be referred to as the
"Construction Commencement Date."
(b) Landlord shall use all reasonable efforts to substantially
complete construction of Landlord's Improvements as soon as possible
following the Construction of Commencement Date in accordance with the
Construction Schedule attached hereto as Exhibit C.1, as may be extended
by excused delays (the
3
29
Estimated Construction Completion Date"). The date on which Landlord
substantially completes construction of Landlord's Improvements (except for
work to be performed by Tenant) shall be referred to as the "Construction
Completion Date." Landlord acknowledges that Tenant will suffer significant
damages if Landlord fails to deliver the Demised Premises on or before the
Estimated Construction Completion Date and that time is of the essence with
respect to the Landlord's completion of the Landlord's Improvements as
required herein. If Landlord fails to cause the Landlord's Improvements to
be substantially completed on or before the Estimated Construction
Completion Date, as said date may be extended from time to time due to
excused delays, Landlord shall be obligated to pay to Tenant the following
sums for each day after the Estimated Construction Completion Date until
the Construction Completion Date up to the maximum of sixty-five (65) days
of delay and thereafter, Landlord shall be liable for Tenant's actual
damages for the delay (which shall include Tenant's actual cost incurred in
connection with holding over at its present location and/or renting
reasonably acceptable substitute space): (a) for the first thirty (30)
days of delay, the sum of One Thousand Dollars ($1,000.00) per day for each
calendar day of delay; (b) for the thirty-first (31st) day through the
sixtieth (60th) day of delay, the sum of Two Thousand Five Hundred Dollars
($2,500.00) per day for each calendar day of delay; and (c) for the
sixty-first (61st) day through the sixty-fifth (65th) day of delay, the sum
of Seven Thousand Five Hundred Dollars ($7,500.00) per day for each
calendar day of delay. Notwithstanding the foregoing, in no event shall
Landlord be liable to Tenant for any punitive, special, incidental,
indirect or consequential damages of any kind whatsoever, each of which is
hereby excluded by agreement of the parties regardless of whether or not
any party has been advised of the possibility of such damages. Landlord
shall pay the sums calculated above (other than actual damages accrued
after the 95th day of delay) within thirty (30) days after the Commencement
Date. In connection with the foregoing, Landlord agrees to deposit into
escrow for the benefit of Tenant all damages received from Regis
Contractors of Northern California, L.P. pursuant to Section 1.7 of that
certain Construction Management Agreement dated March 18, 1997. Tenant
agrees to deliver to Landlord an accounting of Tenant's actual damages upon
request.
B. Tenant or its architect will from time to time upon written request
of Landlord or Landlord's construction lender certify that the construction of
Landlord's Improvements has been completed to that point to the reasonable
satisfaction of Tenant. Notwithstanding the foregoing, nothing contained
herein shall be deemed to abrogate, waive or compromise any of Tenant's rights
hereunder with respect to the construction and completion of Landlord's
Improvements.
C. In the event this Lease has not been terminated pursuant to Paragraph
49 of the Lease, Landlord and Tenant promptly shall execute a document
substantially in the form attached hereto as Exhibit E and made a part hereof,
to establish the Commencement Date and the Expiration Date.
4
30
D. The following phrases shall have the meaning set forth below:
(a) The phrase "commence[d][s] construction of Landlord's
Improvements" as used herein means issuance of all necessary permits
needed to commence construction, a building permit, execution of a
construction contract or contracts for the completion of Landlord's
Improvements in accordance with the Plans, execution of this Lease, and
excavation work has commenced.
(b) The phrase "substantial[ly] complete[ed][ion] [of] construction
of Landlord's Improvements as used in this Lease shall mean the
municipality having jurisdiction thereof issues a certificate of occupancy
permitting Tenant to occupy Landlord's Improvements or takes such other
action as may be customary to permit occupancy or use thereof for the
purposes provided herein and Landlord's Improvements are otherwise ready
for beneficial use and occupancy by Tenant subject to completion of any
punchlist items (as defined herein) by Landlord and Landlord's architect
certified to Tenant in writing that Landlord's Improvements have been
constructed and completed in a good and workmanlike manner in substantial
accordance with the Plans and that to the best of its knowledge the Plans
comply with applicable laws, including without limitation all building
codes, zoning ordinances and regulations and the Act (as defined herein)
and Landlord's Improvements are otherwise ready for beneficial use and
occupancy by Tenant subject to completion of any punchlist items by
Landlord; provided, however, the issuance of a certificate of occupancy or
such other action as may be customary to permit occupancy or use thereof
and the issuance of the architect's certificate shall not be a condition
to payment of rent or commencement of the term if failure to secure such
certificate of occupancy or action or architect's certificate is caused by
the act or neglect of Tenant or if matters required for issuance are the
responsibility of Tenant.
(c) The phrase "usable square feet" means the square feet contained
within the inside of the exterior walls of the Building.
E. Within fifteen (15) days after the Construction Completion Date,
Tenant, Landlord and Landlord's Architect shall prepare and execute a punchlist
(the "punchlist") of incomplete and incorrect items which shall include details
of construction and mechanical and electrical adjustments which are minor in
character and do not materially interfere with Tenant's use or enjoyment of the
Demised Premises in accordance with the provisions of this Lease, and may also
include landscaping and other items which do not materially affect Tenant's use
of the Demised Premises but which cannot be immediately completed because of
weather, or any items listed on the Plans or the Construction Schedule as items
to be completed after substantial completion of the Landlord's Improvements, if
any (such items are sometimes hereinafter referred to as "punchlist items").
Landlord shall use all reasonable efforts to complete the punchlist items as
soon as possible after its receipt of the punchlist, and to minimize disruption
of Tenant's business and other inconveniences to Tenant, subject to excused
delays. If Landlord fails to complete the punchlist items within ninety (90)
days after the receipt by Landlord of the completed punchlist by Tenant, subject
to excused delays, then Tenant shall have the right, but not the obligation, to
complete the punchlist items and Landlord shall reimburse Tenant for its
5
31
reasonable out-of-pocket expenditures in connection therewith upon presentation
of invoices in sufficient detail and lien waivers covering performance of the
work. Nothing herein contained shall be deemed or construed to permit Tenant to
offset against Base Rent or other charges payable by Tenant hereunder. Landlord
shall deliver to Tenant "as built" working drawings of the Landlord's
Improvements within sixty (60) days after completion of the punchlist items.
Landlord shall maintain a retainage of a minimum or ten percent (10%) of
the cost of the so-called tenant improvement portion of the Landlord
Improvements (the "TI Work") or [omitted] based on an estimated approximate cost
of [omitted] for the TI Work. The aforementioned retainage shall not be released
until the punchlist items for TI Work have been completed to Tenant's reasonable
satisfaction.
F. Landlord shall at its own expense correct or repair any parts of
Landlord's Improvements that fail to conform with the requirements of the Plans
during the period of construction of Landlord's Improvements (unless Tenant is
willing to accept such non-conforming work and so notifies Landlord thereof in
writing). Landlord shall correct any defects in the construction of Landlord's
Improvements not caused by Tenant which appear within a period of one (1) year
from the Construction Completion Date, but not otherwise. Landlord shall obtain
for the joint benefit of Landlord and Tenant, a joint, non-exclusive assignment
of all contractor, subcontractor, equipment, material and manufacturers'
warranties relating to Landlord's Improvements which shall contain a minimum of
a one (1) year warranty period commencing with the contractors' or
subcontractors' completion of the work included in the Landlord's Improvements
(the "Warranties"). Furthermore, on the Construction Completion Date, Landlord
shall assign to Tenant the non-exclusive right to enforce any and all
Warranties and Landlord agrees to reasonably cooperate with Tenant's pursuit of
any and all claims under the Warranties.
G. Tenant shall have the right to request that changes be made to the
Plans. Within ten (10) days after Tenant's requests, Landlord shall provide an
estimate of the amount that the change will increase or decrease the cost of
completing the Landlord's Improvements and the time adjustment to the
Construction Schedule, if any. If Tenant approves the change following receipt
of the estimates, Landlord shall submit a change order to its contractors to
implement the change requested by Tenant. The estimated increase or decrease in
the time required to complete the Landlord's Improvements resulting from
Tenant's change shall be reflected as an adjustment to the Construction
Schedule and shall be deemed an "excused delay" and any net increase or
decrease in Landlord's construction costs due to Tenant's change order, shall
be borne by or credited to Tenant, as the case may be, by means of an
adjustment to the Schedule of Rents in accordance with the formula established
on Exhibit D.
H. If due to change orders initiated by Tenant, Landlord's Development
Costs exceed the amount of [omitted] then concurrent with any such change order,
Tenant Agrees to deposit into the escrow created by the Escrow Agreement (as
defined in Paragraph 3 hereof) the total amount of any such increase in
Landlord's Development Costs in excess of [omitted]. Notwithstanding the
foregoing, upon the closing of the permanent financing for the Demised Premises
occurring on or after the Commencement Date, Landlord shall reimburse Tenant for
all such increased costs and the Base Rent shall be adjusted in accordance with
the formula
6
32
established on Exhibit D; provided, however, Base Rent shall not be adjusted
until such time as Tenant is reimbursed hereunder.
5. Use.
A. The Demised Premises shall be used and occupied for general office
purposes and for any other purpose which does not violate any applicable law,
rule, ordinance or regulation of any applicable governmental authority having
jurisdiction ("Tenant's Use"). Landlord represents that, to its actual
knowledge, the Demised Premises are currently zoned "O".
Administrative-Professional District and R1.7/PD, low medium density
residential district under the zoning ordinance of the City of Sunnyvale,
California, which zoning classification, to Landlord's actual knowledge, will
not restrict or limit Tenant's Use; provided, however, Landlord makes no
representation as to whether a special use permit, zoning variance or
comparable relief from the local zoning ordinance is required to conduct
Tenant's Use, and if such special use, variance or comparable relief is
required, Tenant shall obtain the same (at its sole cost and expense). Landlord
further represents, to its actual knowledge without independent investigation
or inquiry and subject to the foregoing proviso, that there are no other zoning
ordinances or any other prohibitions restricting or limiting Tenant's Use in
any material respect. In addition, Tenant may use all or any part of the
Demised Premises for any lawful purpose then permitted by local zoning
ordinances and the certificate of occupancy, if available; provided, however,
Tenant may not use or occupy the Demised Premises, or knowingly permit the
Demised Premises to be used or occupied (including without limitation
subleasing the Demised Premises or any part thereof or assigning this Lease to
any other party conducting a business other than Tenant's Use) or in such
a manner as to cause the value or usefulness of the Demised Premises, or any
part thereof, substantially to diminish (reasonable wear and tear excepted).
Tenant shall have the exclusive right to use of and shall have full access to
the Demised Premises twenty-four (24) hours per day, seven (7) days per week,
three hundred sixty-five (365) days per year during the term.
B. Tenant may, if Tenant so elects, and for Tenant's sole use, install
and operate within the Building microwave ovens and install and operate within
the Building vending machines to dispense hot and cold beverages, ice cream,
candy, food and cigarettes; such machines shall be maintained in a neat and
sanitary condition and shall comply with all applicable laws and ordinances.
Tenant shall also have the right to use, install and operate within the
Building, all telecommunication lines and other telecommunication and
electronic facilities relating to services to be provided to Tenant and its
subtenants and Landlord agrees to provide all necessary easements upon the
Demised Premises reasonably required by said service provider. Upon termination
of the Lease, and if so requested by Landlord, Tenant shall, at its sole cost
and expense, in a good and workmanlike manner and in as expeditious a manner as
possible, remove any or all of such items from the Demised Premises, to the
extent required by Landlord. Tenant further agrees to repair any damage to the
Demised Premises caused by the removal of such items. In conclusion with any
easements granted hereunder to service providers, Landlord reserves the right
to condition any such grant upon receipt of acknowledgement from the relevant
service provider(s) that such service provider agrees to vacate the easement,
and relinquish all of its rights in the Demised Premises, effective upon the
termination of the Lease. Notwithstanding anything contained herein to the
contrary, if the Lease is in full force and effect as of the thirteenth (13th)
anniversary of the Commencement Date and Tenant is not then in default
7
33
hereunder, Landlord waives its rights hereunder to require Tenant to remove from
the Demised Premises any or all of the items referred to above, upon termination
of this Lease.
6. Condition of Demised Premises. Landlord shall construct and Tenant
shall reasonably accept Landlord's Improvements in accordance with the Plans.
As of the Commencement Date, Landlord's Improvements shall be in good working
order and condition, and subject to the items on or to be inserted on the
punchlist, constructed in substantial accordance with the Plans.
7. Maintenance and Repairs.
A. Except as otherwise provided herein, during the term of this Lease,
Tenant shall at Tenant's sole expense, keep the Demised Premises in good
working order, condition and repair and in compliance with all applicable laws
and shall perform all routine maintenance thereof and all necessary repairs
thereto, interior and exterior, structural and nonstructural ordinary and
extraordinary, foreseen or unforeseen, of every nature, kind and description.
When used in this Paragraph 7, "repairs" shall include all necessary
replacements, renewals, alterations, additions and betterments. If Tenant
cannot keep the Demised Premises or any portion thereof in good working order,
condition and repair, then Tenant shall replace the same in a first-class
manner. Tenant shall comply with manufacturers' recommended schedules for
warranty work. Tenant shall furnish all its own cleaning services. All
repairs and replacements made by Tenant shall be at least equal in quality to
the original work and shall be made by Tenant in accordance with all applicable
laws. The necessity for or adequacy of maintenance, repairs and replacements
shall be measured by the standards which are appropriate to improvements of
similar construction and class, provided that Tenant shall in any event make
all repairs and replacements necessary to avoid any structural damage or other
damage or injury to the Demised Premises.
B. Notwithstanding the provisions of Paragraph 7.A., and Tenant's
obligations to pay for all repairs, in the event that at any time during the
term of this Lease after the expiration of the twentieth (20th) Lease Year
(commencing with the Third Extension Term), Tenant reasonably determines that
capital expenditures are required to be expended by Tenant in connection with
maintaining, repairing or replacing the roof or structural components of the
Building, or replacing the parking areas, Building plumbing, electrical
heating, ventilation, or cooling equipment, sprinkler systems, or making any
other capital expenditure required by subsequent law (any such capital
expenditure being herein referred to as a "Specified Capital Item"), then the
Tenant shall submit to Landlord a proposed budget for such capital expenses for
the Specified Capital Items and obtain Landlord's prior written approval
thereof, which written approval shall not be unreasonably withheld or delayed.
Upon Tenant's obtaining Landlord's prior written approval of such Specified
Capital Items and Tenant completing such work in accordance with the
requirements set forth in this Lease, then and in that event, the Landlord
agrees that it shall reimburse Tenant for an amount ("Reimbursement Amount")
equal to the actual costs incurred in connection with the Specified Capital Item
previously approved by Landlord multiplied by a fraction, the numerator of which
is the portion of the useful life of such Specified Capital Items remaining
after the then existing term and the denominator of which is the useful life of
such Specified Capital Item (i.e., by way of example, in the event that the
approved cost for an approved Specified Capital Item was One Thousand Dollars
($1,000.00) and the useful life of such Specified Capital Item was eight (8)
years and such work was commenced at the end of the
8
34
twentieth (20th) Lease Year, then in such event, Landlord would reimburse Tenant
for Five Hundred Dollars ($500) as the Reimbursement Amount). The "useful life"
of a Specified Capital Item shall be determined using the United States Internal
Revenue Service standard depreciation schedule in effect on the date that the
applicable capital expenditure is made. Notwithstanding anything contained
herein to the contrary, in the event that the Tenant exercises its option to
extend the term of the Lease, then simultaneous with the exercise of such
renewal option, the Tenant shall pay to Landlord an amount equal to the
difference between the Reimbursement Amount and the amount Landlord would have
paid as a Reimbursement Amount had the term been extended by the Extension Term
at the time such Specified Capital Item was commenced (i.e., by way of example,
in the event that the Specified Capital Item was One Thousand Dollars ($1,000)
and that the useful life of the Specified Capital Item was eight (8) years, with
such work having been commenced at the end of the twentieth (20th) Lease Year,
whereby Landlord reimbursed Tenant a Reimbursement Amount of Five Hundred
Dollars ($500), then simultaneous with the exercise of its option to extend the
Term for the Fourth Extension Term, the Tenant would pay to Landlord an amount
equal to Five Hundred Dollars ($500)). The allocation of the costs of Specified
Capital Items as set forth in this Paragraph 7.B. shall not relieve Tenant of
Tenant's maintenance and repair obligations under this Lease.
8. Alterations. Tenant may install tenant finishes in the Demised
Premises and make interior alterations, additional installations,
modifications, substitutions, improvements and decorations (collectively,
"Alterations") in and to the Demised Premises, subject only to the following
conditions:
(i) any Alterations shall be made at Tenant's sole cost and expense
so that the Demised Premises shall at all times be free of liens for
labor and materials supplied to the Demised Premises;
(ii) without the prior written approval of Landlord, Tenant shall
make no Alterations (x) which are structural in nature or adversely
affect in any way the structure of the Demised Premises; or (y) which
adversely affect or could render void or invalidate any Warranties under
this Lease. In addition, without the prior written approval of Landlord,
Tenant shall make no Alterations to any portion of the exterior or
elevation of the Building.
(iii) any Alterations shall be performed in a good and workmanlike
manner and in compliance with all applicable laws and requirements of
governmental authorities having jurisdiction and applicable insurance
requirements and shall not violate any term of any agreement or
restriction to which the Demised Premises are subject;
(iv) Tenant, at its sole cost and expense, shall cause its
contractors to maintain builder's risk insurance and such other insurance
(including, without limitation, workers compensation insurance) as is then
customarily maintained for such work, all with insurers licensed by the
State of California;
(v) At least fifteen (15) days prior to Tenant's commencement of any
Alterations costing in excess of One Million Dollars ($1,000,000.00), the
plans and specifications therefor shall be submitted to Landlord for
Landlord's review and
9
35
approval, which approval shall not be unreasonably withheld or delayed
provided that the provisions of this subparagraph (v) shall not apply to
initial tenant improvements needed to locate a subtenant in the Demised
Premises; and
(vi) To the extent not inconsistent with the requirements set forth
above, Tenant shall not be required to obtain Landlord's consent to
Alterations which are a subtenant's initial tenant improvements.
Any Alteration shall, when completed, be of such character as not to
reduce the value or utility of the Demised Premises or the Building to which
such Alteration is made below its value or utility to Landlord immediately
before such Alteration, nor shall such Alternation after the exterior of the
Improvements or reduce the area or cubic content of the Building, nor change
the character of the Demised Premises or the Building as to use without
Landlord's express written consent.
No change, alteration, restoration or new construction shall be in or
connect the Improvements with any property, building or other improvement
located outside the boundaries of the Land, nor shall the same obstruct or
interfere with any existing easement.
Tenant shall notify Landlord in writing 30 days prior to commencing any
alterations, additions or improvements to the Demised Premises so that Landlord
shall have the right to record and post notices of nonresponsibility on the
Demised Premises. Within a reasonable time period prior to commencing the
alterations, additions or improvements, Tenant shall provide Landlord with
copies of all plans and specifications prepared in connection with any such
alteration, addition or improvement, as well as copies of each material
amendment and change thereto, if and when applicable.
All of Tenant's generators and uninterruptible power supply equipment (but
in no event including the primary HVAC system serving the Building), trade
fixtures, movable partitions, furniture, machinery and furnishings installed by
Tenant or assignees, subtenants or licensees of Tenant shall remain the
property of the owner thereof with the right of removal, whether or not affixed
and or attached to the real estate and the owner thereof shall be entitled to
remove the same or any part thereof during the term or at the end of the term
provided herein, provided that such owner shall repair any damage caused by
such removal. Except as otherwise provided herein, all Alterations made or
installed by Tenant shall remain the Property of Tenant and Tenant shall have
the right to remove the Alterations at any time during the term hereof provided
Tenant shall repair any damage resulting therefrom and leave the Demised
Premises in a commercially reasonable condition. Notwithstanding the foregoing,
any Alterations remaining on the Demised Premises at the end of the term shall
become the property of Landlord without payment therefor by Landlord, and shall
be surrendered to Landlord at the expiration of the term of this Lease;
provided however, if the Lease term ends prior to the thirteenth (13th)
anniversary of the Lease Commencement Date, if so requested by Landlord, Tenant
shall, at is sole cost and expense and in as expeditious a manner as possible
remove any or all of such Alterations from the Demised Premises, to the extent
required by Landlord. Tenant further agrees to repair any damage resulting
therefrom and leave the Demised Premises in a commercially reasonable condition.
10
36
9. Signs.
A. Tenant may install, at its expense and pursuant to the Plans, a
monument identification sign containing Tenant's name at a location depicted on
Exhibit B unless such location would cause a violation of applicable laws in
which event said monument identification sign shall be moved to a location
mutually acceptable to the parties. Tenant shall also have the right to place
any additional signs at the Demised Premises without the prior consent of
Landlord, provided that such sign or signs (a) do not cause any structural
damage or other damage to the Building; (b) do not violate applicable
governmental laws, ordinances, rules or regulations; (c) do not violate any
existing restrictions affecting the Demised Premises; and (d) are compatible
with the architecture of the Building and the landscaped area adjacent thereto.
Tenant shall remove all signage from the Demised Premises at the end of the
term.
B. Landlord may place signs on the Demised Premises identifying Tenant
prior to the Construction Completion Date, provided Tenant has approved each
sign, such approval not to be unreasonably withheld.
10. Services.
A. Landlord shall provide all utility equipment, distribution systems,
fixtures and parts to the Demised Premises in accordance with the Plans, and
shall in all other respects prepare the Demised Premises to accept all
utilities to be used by Tenant during the term of the Lease as contemplated by
the Plans including all connection, tap-in and impact fees, any charges for
the underground installation of electric, gas or other utilities or services,
and other charges relating to the extension of or change in the facilities
necessary to provide the Demised Premises with adequate utilities services.
Tenant shall contract for and pay directly for the cost of usage of all
utilities including all charges for water, heat, gas, light, garbage,
electricity, telephone, sewage, steam, power or other public or private utility
services. If after Landlord's installation of the utility systems required to be
provided herein, any bond, charge or fee is required by the state in which the
Demised Premises are located, or any city or other agency, subdivision, or
instrumentality thereof, or by any utility company furnishing services or
utilities to the Demised Premises, as a condition precedent to continuing to
furnish utilities or services to the Demised Premises, such bond, charge or fee
shall be deemed to be a utility charge payable by Tenant. To the extent existing
utility easements on the Demised Premises are not sufficient to provide utility
and communication services to the Demised Premises for Tenant's Use, Landlord
agrees to grant additional easements to utility providers, including
telecommunication and electronic service providers, if reasonably required by
Tenant.
B. The Demised Premises shall include all of the improvements shown on
the Site Plan, including, without limitation, exclusive use of the paved
parking as set forth on the Site Plan.
C. Tenant acknowledges that any one or more of the services provided for
in Paragraph 10 hereof may be interrupted or suspended by reason of accident,
repair, alterations or improvements necessary to be made, strike, lockout,
misuse or neglect by Tenant and Tenant's agents, employees or invitees, or by
shortages of fuel or other energy supplies to be provided by public or private
utilities or supplies or by other matters, and Landlord shall not be liable to
11
37
Tenant therefor, nor shall Tenant have any right to terminate the Lease or other
rights against Landlord in the event of a failure, interruption or suspension of
any of the aforesaid services.
11. Compliance with Law.
A. Landlord covenants that the Demised Premises (except trade fixtures,
equipment, machinery or any other item constructed or installed by Tenant) will
materially conform as of the Commencement Date to any applicable laws, orders,
statutes, ordinances, rules, regulations and requirements of federal, state and
municipal governments, including, without limitation, all applicable rules and
regulations of the Board of Fire Underwriters and any requirements of the
certificate of occupancy or any permit with respect to the Demised Premises and
the sidewalks, curbs, roadways, alleys, entrances or other facilities adjacent
or appurtenant thereto. Landlord shall be responsible for procuring building
and other permits and licenses necessary for construction of Landlord's
Improvements.
B. Tenant shall throughout the term of this Lease, at Tenant's sole
cost, materially comply with or remove or cure any violation of any applicable
laws, orders, statutes, ordinances, rules, regulations and requirements of
federal, state and municipal governments, including, without limitation, any
applicable laws, orders, statutes, ordinances, rules, regulations and
requirements of any federal, state or local government relating to occupational
safety and health (collectively, the "OSHA Regulations"), all applicable rules
and regulations of the Board of Fire Underwriters and any requirements of the
certificate of occupancy or any permit with respect to the Demised Premises and
the sidewalks, curbs, roadways, alleys, entrances or railroad track facilities
adjacent or appurtenant thereto, and whether the compliance, curing or removal
of any such violation and the costs and expenses necessitated thereby shall
have been foreseen or unforeseen, ordinary or extraordinary, and whether or not
the same shall be presently within the contemplation of Landlord or Tenant or
shall involve any change of governmental policy, or require structural or
extraordinary repairs, alterations or additions by Tenant and irrespective of
the costs thereof; provided, however, that Landlord shall be responsible, at
Landlord's sole cost, to make all repairs needed for the Demised Premises to
comply with all laws if said repair is required within one (1) years after the
Commencement Date and is necessary due to a defect in the construction of the
Landlord's Improvements including without limitation, a failure to construct
the Landlord's Improvements so that the Demised Premises are in compliance with
all laws as of the Commencement Date. Tenant, at its sole cost and expense,
shall comply with all agreements, contracts, easements, restrictions,
reservations or covenants, if any, affecting the Demised Premises or hereafter
created by Tenant and consented to, in writing, by Tenant or requested, in
writing, by Tenant. Tenant shall also comply with, observe and perform all
provisions and requirements of all policies of insurance at any time in force
with respect to the Demised Premises and shall comply with all development
permits issued by governmental authorities issued in connection with development
of the Demised Premises. Tenant shall procure and maintain all permits and
licenses required for the transaction of Tenant's business at the Demised
Premises, including with limitation, any special use permit, zoning variance or
comparable zoning relief necessary for Tenant's Use.
12
38
12. Landlord's Title, Authority, and Quiet Enjoyment; Tenant's Authority.
A. Landlord represents that it will have, as of the Commencement Date,
marketable fee simple title to the Demised Premises, subject to the exceptions
to title currently encumbering the Demised Premises as described in Exhibit H,
and any additional exceptions to title created in connection with Landlord's
acquisition or development of the Demised Premises, or financing of such
acquisition or development (collectively referred to herein as the "Permitted
Exceptions"). Landlord represents that any such additional exceptions to title
created in connection with Landlord's acquisition or development of the Demised
Premises or financing of such acquisition or development shall not materially
interfere with Tenant's intended use of the Demised Premises. Any lien claims
properly bonded over or insured over by title insurance shall be deemed to be
Permitted Exceptions hereunder.
B. Landlord represents and warrants that it has full and complete
authority to enter into this Lease under all of the terms, conditions and
provisions set forth herein, and so long as Tenant keeps and substantially
performs each and every term, provision and condition herein contained on the
part of Tenant to be kept and performed, Tenant shall peacefully and quietly
enjoy the Demised Premises without hindrance or molestation by Landlord or by
any other person claiming by, through or under Landlord, subject to the terms
of the lease. Without limiting the foregoing, Landlord covenants to perform all
obligations to be performed by Landlord and to pay as and when due all amounts
to be paid by Landlord under any mortgage, deed of trust, ground lease or other
instrument encumbering the Demised Premises. Each individual executing this
Lease on behalf of Landlord represents and warrants to Tenant that he or she is
duly authorized to do so.
C. Tenant represents and warrants that it has full and complete
authority to enter into this Lease under all of the terms, conditions and
provisions set forth herein.
D. Tenant hereby approves the condition of Landlord's title to the
Demised Premises. This Lease shall be subject to the Permitted Exceptions and
Landlord shall not permit or cause any easements, covenants, restrictions,
conditions or other changes in Landlord's title which would materially and
adversely impact Tenant's Use. Landlord shall notify Tenant in writing prior to
permitting or causing any easements, covenants, restrictions, or conditions to
be placed of record.
13. Subordination. The priority of this Lease and the leasehold estate of
Tenant created hereunder are and shall be subject and subordinate to the lien of
any mortgage, deed of trust, sale-leaseback, ground lease or similar
encumbrance, whether such encumbrance is placed against the fee or leasehold
estate, affecting the Demised Premises and to all renewals, modifications,
consolidations, replacements and extensions thereof, and advances thereunder;
provided, however, with respect to any mortgage, deed of trust, sale-leaseback,
ground lease or similar encumbrance such subordination shall be subject to
receipt by Tenant of a nondisturbance agreement in form reasonably required by
any such lienholder or ground Lessor (collectively, a "Mortgagee") and
reasonably acceptable to Tenant. Tenant agrees at any time hereafter, upon
twenty (20) days prior written notice, to execute and deliver any instruments,
releases or other documents that may reasonably be required for the purpose of
subjecting and subordinating this Lease, as above provided, to the lien of any
such mortgage, deed of trust, ground lease, sale-
13
39
leaseback or similar encumbrance in a form reasonably acceptable to Tenant and
the holder of such mortgage, provided said subordination provides that all
insurance proceeds and condemnation awards will be made available for the
restoration of the Demised Premises, as provided herein, and that Tenant's
rights hereunder will not be disturbed unless Tenant is in default beyond all
applicable cure periods. Any fee which Landlord's lender or ground lessor may
charge for such agreement shall be paid by Landlord.
In the event of any act or omission of Landlord constituting a default by
Landlord, Tenant shall not exercise any remedy until Tenant has given Landlord
and any mortgagee, ground lessor or sale-leaseback lessor of the Demised
Premises that has provided Tenant with written notice of its interest in the
Demised Premises and a notice address for each such party a prior thirty (30)
day written notice of such act or omission and until a reasonable period of
time to allow Landlord or the mortgagee, ground lessor or sale-leaseback lessor
to remedy such act or omission shall have elapsed following the giving of such
notice; provided, however, if such act or omission cannot, with due diligence
and in good faith, be remedied within such thirty (30) day period, then
Landlord or any such mortgagee, ground lessor or sale-leaseback lessor shall be
allowed such further period of time as may be reasonably necessary provided
that it commence remedying the same with due diligence and in good faith within
said thirty (30) day period.
If any Mortgagee shall succeed to the rights of Landlord under this Lease
or to ownership of the Demised Premises, whether through possession or
foreclosure or the delivery of a deed to the Demised Premises, then, upon
written request of such mortgagee so succeeding to Landlord's rights hereunder,
Tenant shall attorn to and recognize such mortgagee, ground lessor or
sale-leaseback lessor as Tenant's landlord under this Lease, and shall
promptly execute and deliver any instrument that such mortgagee may reasonably
request to evidence such attornment (whether before or after making of the
mortgage, ground lease or sale-leaseback lease). In the event of any other
transfer of Landlord's interest hereunder, upon the written request of the
transferee and Landlord, Tenant shall attorn to and recognize such transferee
as Tenant's landlord under this Lease and shall promptly execute and deliver
any instrument that such transferee and Landlord may reasonably request to
evidence such attornment.
14. Assignment and Sublease. Tenant, if there is no Material Breach (as
herein defined) by Tenant hereunder, shall have the right to assign this Lease
or to sublease all or any portion or the Demised Premises, without Landlord's
written consent in accordance with the terms of this Paragraph 14.
Tenant may assign this Lease or sublet the Demised Premises to an
affiliate or subsidiary more than fifty percent (50%) of the voting stock of
which is owned directly or indirectly by the direct or remote parent of Tenant
(without Landlord's consent, upon prior written notice to Landlord) and further
Tenant's interest in this Lease may be assigned to and assumed by a successor
to Tenant pursuant to a purchase of all or substantially all of the assets of
Tenant in connection with the sale of such assets or to any entity which
acquires all of Tenant's capital stock (without Landlord's consent upon prior
written notice to Landlord).
Any assignment or sublease shall require the assignee or subtenant to
comply with all terms of this Lease except for any sublease term, which shall
be at Tenant's discretion (but in no event extended beyond the term of this
Lease), and a copy of such sublease or assignment shall be
14
40
delivered to Landlord at least ten (10) days prior to commencement of such
sublease or assignment.
Any assignee shall assume, by instrument in form and content satisfactory
to Landlord, the due performance of all of Tenant's obligations under this
Lease, including any accrued obligations at the time of the effective date of
the assignment, and such assumption agreement shall state that the same is made
by the assignee for the express benefit of Landlord as a third party
beneficiary thereof.
Each sublease permitted by this Paragraph 14 shall be subject and
subordinate to all of the terms, covenants and conditions of this Lease and to
all of the rights of Landlord hereunder; and in the event this Lease shall
terminate before the expiration of such sublease, the sublessee thereunder
will, at Landlord's option, attorn to Landlord and waive any rights the
sublessee may have to terminate the sublease or to surrender possession
thereunder, as a result of the termination of this Lease.
Tenant agrees to pay on behalf of Landlord any and all costs of Landlord
or otherwise occasioned by such assignment or subletting, including without
limitation, the cost of any alteration, addition, improvement or other
renovation or refurbishment to the Demised Premises made in connection with
such assignment or subletting and any cost imposed by any governmental
authority in connection with any of the foregoing.
Any assignment or subletting under this Paragraph 14 shall not relieve
Tenant (or any guarantor of Tenant's obligations under the Lease or any
assignee) of its obligations hereunder. Any assignment or subletting of this
Lease which is not in compliance with the provisions of this Paragraph 14 shall
be of no effect and void. Except as permitted in this Paragraph 14, Tenant
shall not transfer, sublet, assign or otherwise encumber its interest in the
Lease or the Demised Premises, unless consented to by Landlord.
No assignment or subleasing hereunder shall relieve Tenant from any of
Tenant's obligations in this Lease contained.
All profits from any such assignment or subletting shall be the property
of Tenant and not Landlord.
15. Lease Extension. If this Lease shall not have been terminated
pursuant to any provisions hereof and there is no Material Breach (as defined
herein) by Tenant hereunder at the time set for exercise of the Extension Terms
(as herein defined) and at the time set for commencement thereof, then Tenant
may, at Tenant's option, extend the term of this Lease for five (5) successive
additional terms of four (4) years each (each an "Extension Term," collectively
the "Extension Terms") commencing on the expiration of the original term, or
the immediately preceding Extension Term, as the case may be. Tenant may
exercise such option by giving Landlord written notice at least ten (10) months
prior to the expiration of the original or the immediately preceding Extension
Term, as the case may be. Upon the giving by Tenant to Landlord of such written
notice and the compliance by Tenant with the foregoing provisions of this
Paragraph 15, this Lease shall be deemed to be automatically extended upon all
the
15
41
covenants, agreements, terms, provisions and conditions set forth in this Lease,
except that Base Rent for each such Extension Term shall be as provided on
Exhibit D.
If Tenant fails or omits to so give to Landlord the written notice
referred to above, Landlord shall provide Tenant with written notice of
Tenant's failure to exercise the Extension Term, and upon receipt of such
notice, Tenant shall be allowed fifteen (15) days to exercise the extension
option allowed for herein. If Landlord fails to provide such notice, Tenant's
renewal option shall expire upon the expiration of the then current term.
Failure to respond to Landlord's notice within such fifteen (15) days shall be
deemed to be a waiver by Tenant of its extension option hereunder.
16. Impositions.
A. Tenant covenants and agrees to pay during the term of this Lease, as
Additional Rent, before any fine, penalty, interest or cost may be added
thereto for the nonpayment thereof, all impositions described herein that
accrue on or after the Commencement Date, which include without limitation, all
real estate taxes, special assessments, water rates and charges, sewer rates and
charges, including any sum or sums payable for future sewer or water capacity
increases, charges for public utilities, street lighting, excise levies,
licenses, permits, inspection fees, other governmental charges, and all other
charges or burdens of whatsoever kind and nature (including costs, fees, and
expenses of complying with any restrictive covenants or similar agreements to
which the Demised Premises are subject), incurred in the use, occupancy,
ownership, operation, leasing or possession of the Demised Premises, without
particularizing by any known name or by whatever name hereafter called, and
whether any of the foregoing be general or special, ordinary or extraordinary,
foreseen or unforeseen (all of which are sometimes herein referred to as
"Impositions"), which at any time during the term may have been or may be
assessed, levied, confirmed, imposed upon, or become a lien on the Demised
Premises, or any portion thereof, or any appurtenance thereto, rents or income
therefrom, and such easements or rights as may now or hereafter be appurtenant
or appertain to the use of the Demised Premises.
B. If, at any time during the term of this Lease, any method of taxation
shall be such that there shall be levied, assessed or imposed on Landlord, or
on the Basic Rent or Additional Rent, or on the Demised Premises or on the
value of the Demised Premises, or any portion thereof, a capital levy, sales or
use tax, gross receipts tax or other tax on the rents received therefrom, or a
franchise tax, or an assessment, levy or charge measured by or based in whole
or in part upon such rents or value, Tenant covenants to pay and discharge the
same, it being the intention of the parties hereto that the rent to be paid
hereunder shall be paid to Landlord absolutely net without deduction or charge
of any nature whatsoever foreseeable or unforeseeable, ordinary or
extraordinary, or of any nature, kind or description, except as in this Lease
otherwise expressly provided. Nothing in this Lease contained shall require
Tenant to pay any municipal, state or federal net income or excess profits
taxes assessed against Landlord, or any municipal, state or federal capital
levy, estate succession, inheritance or transfer taxes of Landlord, or
corporation franchise taxes imposed upon any corporate owner of the fee of the
Demised Premises.
C. Tenant covenants to furnish Landlord, within 30 days after the date
upon which any Imposition or other tax, assessment, levy or charge is payable
by Tenant, official receipts of
16
42
the appropriate taxing authority, or other appropriate proof satisfactory to
Landlord, evidencing the payment of the same. The certificate, advice or xxxx
of the appropriate official designated by law to make or issue the same or to
receive payment of any Imposition or other tax, assessment, levy or charge may
be relied upon by Landlord as sufficient evidence that such Imposition or other
tax, assessment, levy or charge is due and unpaid at the time of the making of
issuance of such certificate, advice or xxxx, unless Tenant provides Landlord
with evidence to the contrary.
D. At Landlord's written demand after any Event of Default (as defined
in Section 20 hereinafter) and for as long as such Event of Default is uncured,
or upon the request of any Mortgagee of the Demised Premises, (but only after
an Event of Default and for as long as such Event of Default is uncured) Tenant
shall pay to Landlord the known or estimated yearly real estate taxes and
assessments payable with respect to the Demised Premises in monthly payments
equal to one-twelfth of the known or estimated yearly real estate taxes and
assessments next payable with respect to the Demised Premises. From time to
time Landlord may re-estimate the amount of real estate taxes and assessments,
and in such event Landlord shall notify Tenant, in writing, of such re-estimate
and fix future monthly installments for the remaining period prior to the next
tax and assessment due date in an amount sufficient to pay the re-estimated
amount over the balance of such period after giving credit for payments made by
Tenant on the previous estimate. If the total monthly payments made by Tenant
pursuant to this Paragraph 16D shall exceed the amount of payments necessary for
said taxes and assessments, such excess shall be credited on subsequent monthly
payments of the same nature; but if the total of such monthly payments so made
under this paragraph shall be insufficient to pay such taxes and assessments
when due, then Tenant shall pay to Landlord such amount as may be necessary to
make up the deficiency.
E. Tenant shall have the right at its own expense to contest the amount
or validity, in whole or in part, of any Imposition by appropriate proceedings
diligently conducted in good faith, but only after Tenant provides Landlord or
the Mortgagee reasonable security, or Tenant makes payment of such Imposition,
unless such payment, or a payment thereof under protest, would operate as a bar
to such contest or interfere materially with the prosecution thereof, in which
event, notwithstanding the provisions of Paragraph 16A hereof Tenant may
postpone or defer payment of such Imposition if neither the Demised Premises nor
any portion thereof would, by reason of such postponement or deferment, be in
danger of being forfeited or lost, and (b) Tenant is not then in Material Breach
of this Lease. Upon the termination of any such proceedings, Tenant shall pay
the amount of such Imposition or part thereof, if any, as finally determined in
such proceedings, the payment of which may have been deferred during the
prosecution of such proceedings, together with any costs, fees, including
attorney's fees, interest, penalties, fines, and other liability in connection
therewith, and upon such payment Landlord shall return all amounts or
certificates deposited with it with respect to the contest of such Imposition,
as aforesaid, or, at the written direction of Tenant, Landlord shall make such
payment out of the funds on deposit with Landlord and the balance, if any, shall
be returned to Tenant. Tenant shall be entitled to the refund of any
Imposition, penalty, fine and interest thereon received by Landlord which have
been paid by Tenant or which have been paid by Landlord but for which Landlord
has been previously reimbursed in full by Tenant. Landlord shall not be
required to join in any proceedings referred to in this Paragraph 16E unless the
provisions of any law, rule or regulation at the time in effect shall require
that such proceedings be brought by or in the name of Landlord, in which event
Landlord shall join in such proceedings
17
43
or permit the same to be brought in Landlord's name upon compliance with such
conditions as Landlord may reasonably require. Landlord shall not ultimately be
subject to any liability for the payment of any fees, including attorney's fees,
costs and expenses in connection with such proceedings. Tenant agrees to pay all
such fees (including reasonable attorney's fees), costs and expenses or, on
demand, to make reimbursement to Landlord for such payment. If Landlord is
provided a certificate of deposit or other interest bearing instrument as
security for the payment of the contested Imposition, during the time when any
such certificate of deposit or other interest bearing instrument is on deposit
with Landlord, and prior to the time when the same is returned to Tenant or
applied against the payment, removal or discharge of Impositions, as above
provided, Tenant shall be entitled to receive all interest paid thereon, if any.
Cash deposits shall not bear interest.
17. Insurance.
A. During the term of this Lease, during any extension thereof, and
during any holdover period, Tenant shall at its cost and expense procure and
keep in force a policy of comprehensive public liability insurance, with limits
of not less than $1,000,000 for injury to any one person, $2,000,000 as to any
one accident, and $100,000 as to property damage, all on a per occurrence basis
which policy shall name Landlord and its managing agent as additional insureds.
A certificate of such insurance shall be delivered to Landlord prior to the
Commencement Date and shall provide that same may not be cancelled or lowered in
amounts without prior written notice of not less than thirty (30) days to
Landlord and Landlord's mortgagee. Notwithstanding the foregoing, Tenant may
insure the foregoing risks under its blanket policy or elect to self-insure
such risks as provided in Paragraph 17E below. Any such liability insurance
shall contain a contractual liability endorsement covering Tenant's
indemnification obligations under this Lease.
B. During the term of this Lease and any extension thereof, Tenant, at
its sole cost and expense, shall obtain and continuously maintain in full force
and effect, policies of insurance covering the Improvements constructed,
installed or located on the Demised Premises naming the Landlord, as loss payee
as its interest may appear, against (a) loss or damage by fire; (b) loss or
damage from such other risks or hazards now or hereafter embraced by an
"Extended Coverage Endorsement," including, but not limited to, windstorm,
hail, explosion, vandalism, riot and civil commotion, damage from vehicles,
smoke damage, water damage and debris removal; (c) loss for flood if the
Demised Premises are in a designated flood or flood insurance area; (d) loss
for damage by earthquake if the Demised Premises are located in an
earthquake-prone area; (e) loss from so-called explosion, collapse and
underground hazards; and (f) loss or damage from such other risks or hazards of
a similar or dissimilar nature which are now or may hereafter be customarily
insured against with respect to improvements similar in construction, design,
general location, use and occupancy to the Improvements. At all times, such
insurance coverage shall be in an amount equal to 100% of the then "full
replacement cost" of the Improvements. "Full Replacement Cost" shall be
interpreted to mean the cost of replacing the improvements without deduction
for depreciation or wear and tear, and it shall include a reasonable sum for
architectural, engineering, legal, administrative and supervisory fees
connected with the restoration or replacement of the Improvements in the event
of damage thereto or destruction thereof. If a sprinkler system shall be
located in the Improvements, sprinkler leakage insurance shall be procured and
continuously maintained by Tenant at Tenant's
18
44
sole cost and expense. Tenant shall cause to be inserted in the policy of
insurance required by this Paragraph 17B a so-called "waiver of subrogation"
clause as to Landlord and Landlord's insurer.
C. During the term of this Lease and any extension thereof, Tenant shall
maintain Xxxxxxx'x Compensation Insurance in accordance with the laws of the
State of California.
D. Tenant shall maintain insurance coverage (including loss of use and
business interruption coverage) upon Tenant's business and upon all personal
property of Tenant or the personal property of others kept, stored or
maintained on the Demised Premises against loss or damage by fire, windstorm or
other casualties or causes for such amount as Tenant may desire, and Tenant
agrees that such policies shall contain a waiver of subrogation clause as to
Landlord and Landlord's insurer.
E. Tenant's right to self-insure with respect to liability insurance is
conditioned upon Tenant or Tenant's guarantor maintaining a net worth of at
least $100,000,000.00. Tenant shall furnish Landlord with written confirmation
that Tenant has elected to self-insure with respect to liability insurance (if
that is the case), and if so, that Tenant's or Tenant's guarantor's net worth
is at least $100,000,000.00 as evidenced by audited financial statements of
Tenant or Tenant's guarantor or an affidavit from Tenant's or Tenant's
guarantor's chief financial officer. If Tenant self-insures with respect to
liability insurance, then Tenant agrees to indemnify, defend, and hold Landlord
harmless from and against any loss, damage, costs, fees (including attorneys'
fees), claims, demands, actions, cause of action, judgments, suits and
liability that was or would have been covered by the insurance policy or
policies replaced by self-insurance and such self-insurance shall not affect
the nonliability of Landlord under Paragraph 17F as to any loss or damage
caused by the perils described therein. The indemnification contained in this
Paragraph 17E is in addition to, and not in lieu of, any covenants or
obligations of Tenant contained in the other Paragraphs of this Lease. If
Tenant so elects to become a self-insurer with respect to liability insurance,
Tenant shall deliver to Landlord notice in writing of the required coverages
which it is self-insuring setting forth the amount, limits, and scope of the
self-insurance in respect to each type of coverage self-insured. Tenant, at
Landlord's request, shall provide to Landlord's mortgagee or assignee a
certificate satisfactory to such mortgagee or assignee setting forth the
self-insured coverages, if any, and stating that all losses shall be payable to
such mortgagee and/or assignee as its interests may appear.
Nothing in this Paragraph shall prevent Tenant from taking out insurance
of the kind and in the amount provided for under the preceding paragraphs of
this Paragraph under a blanket insurance policy or policies (certificates
thereof reasonably satisfactory to Landlord shall be delivered to Landlord)
which may cover other properties owned or operated by Tenant as well as the
Demised Premises; provided, however, that any such policy of blanket insurance
of the kind provided for shall specify therein the amounts thereof exclusively
allocated to the Demised Premises or Tenant shall furnish Landlord and the
holder of any fee mortgage with a written statement from the insurers under
such policies specifying the amounts of the total insurance exclusively
allocated to the Demised Premises; and provided, further, however, that such
policies of blanket insurance shall, as respects the Demised Premises, contain
the various provisions required of such an insurance policy by the foregoing
provisions of this Paragraph 17.
19
45
F. Tenant hereby releases Landlord (and Landlord's assignees, employees,
agents and servants) and waives any claims it may have against Landlord from any
liability for damage to or destruction of Tenant's trade fixtures, personal
property (including also property under the care, custody, or control of
Tenant), machinery, equipment, furniture, fixtures and business interests on the
Demised Premises, except arising from Landlord's or Landlord's assignees',
employees', agents' or servants' negligence. This Paragraph shall apply
especially, but not exclusively, to damage or destruction caused by the flooding
of basements or other subsurface areas, or by refrigerators, sprinkling devices,
air conditioning apparatus, water, snow, frost, steam, excessive heat or cold,
falling plaster, broken glass, sewage, gas, odors or noise, or the bursting or
leaking of pipes or plumbing fixtures, and shall apply equally, whether any such
damage results from the act or omission of other tenants or occupants in the
Demised Premises or any other persons, and whether such damage be caused by or
result from any of the aforesaid, or shall be caused by or result from other,
circumstances of a similar or dissimilar nature.
G. Tenant shall require each of its contractors and tradespeople to
carry contractors liability/completed operations insurance, in the amounts
specified in Paragraph 17A above, from companies licensed to do business in the
State of California.
H. Upon expiration of the term of this Lease, the unearned premiums upon
any insurance policies or certificates thereof lodged with Landlord by Tenant
shall be payable to Tenant, provided that Tenant shall not then be in default
in keeping, observing or performing the terms and conditions of this Lease.
18. Destruction and Restoration.
A. Tenant covenants and agrees that in case of damage to or destruction
of the Improvements after the Commencement Date of the term of this Lease, by
fire or otherwise, Tenant, at its sole cost and expense, shall promptly restore,
repair, replace and rebuild the same as nearly as possible to the condition that
the same were in immediately prior to such damage or destruction with such
changes or alterations (made in conformity with Paragraph 8 hereof) as may be
reasonably acceptable to Landlord or required by law. Tenant shall forthwith
give Landlord written notice of such damage or destruction upon the occurrence
thereof and specify in such notice, in reasonable detail, the extent thereof.
Such restoration, repairs, replacements, rebuilding, changes and alterations,
including the cost of temporary repairs for the protection of the Demised
Premises, or any portion thereof, pending completion thereof are sometimes
hereinafter referred to as the "Restoration." The Restoration shall be carried
on and completed in accordance with the provisions and conditions of Paragraphs
8 and 18B hereof. If the net amount of the insurance proceeds (after deduction
of all costs, expenses and fees related to recovery of the insurance proceeds)
recovered by Landlord and held by Landlord and Tenant as co-trustee is
reasonably deemed insufficient by Landlord to complete the Restoration of such
improvements (exclusive of Tenant's personal property and trade fixtures which
shall be restored, repaired or rebuilt out of Tenant's separate funds), Tenant
shall, upon request of Landlord, deposit with Landlord and Tenant, as
co-trustees, a cash deposit equal to the reasonable estimate of the amount
necessary to complete the Restoration of such improvements less the amount of
such insurance proceeds available.
20
46
B. All insurance moneys recovered by Landlord and held by Landlord and
Tenant as co-trustees on account of such damage or destruction, less Landlord's
reasonable out-of-pocket costs, if any, to Landlord of such recovery, shall be
applied to the payment of the costs of the Restoration and shall be paid out
from time to time as the Restoration progresses upon the written request of
Tenant, accompanied by a certificate of the architect or a qualified
professional engineer in charge of the Restoration stating that as of the date
of such certificate (a) the sum requested is justly due to the contractors,
subcontractors, materialmen, laborers, engineers, architects, or persons, firms
or corporations furnishing or supplying work, labor, services or materials for
such Restoration, or is justly required to reimburse Tenant for any expenditures
made by Tenant in connection with such Restoration, and when added to all sums
previously paid out by Landlord does not exceed the value of the Restoration
performed to the date of such certificate by all of said parties; (b) except for
the amount, if any, stated in such certificates to be due for work, labor,
services or materials there is not outstanding indebtedness known to the person
signing such certificate, after due inquiry, which is then due for work, labor,
services or materials in connection with such Restoration, which, if unpaid,
might become the basis of a mechanic's lien or similar lien with respect to the
Restoration or a lien upon the Demised Premises, or any portion thereof; and (c)
the costs, as estimated by the person signing such certificate, of the
completion of the Restoration required to be done subsequent to the date of such
certificate in order to complete the Restoration do not exceed the sum of the
remaining insurance moneys, plus the amount deposited by Tenant, if any,
remaining in the hands of Landlord after payment of the sum requested in such
certificate.
Tenant shall furnish Landlord within thirty (30) days after Tenant's
receipt of each progress payment with evidence reasonably satisfactory to
Landlord that Tenant has paid all bills in respect to any work, labor, services
or materials performed, furnished or supplied in connection with such
Restoration which was covered by the previous progress payment. Landlord shall
not be required to pay out or consent to any additional insurance moneys where
Tenant fails to supply satisfactory evidence of the payment of work, labor,
services or materials performed, furnished or supplied, as aforesaid. If the
insurance moneys in the hands of Landlord and Tenant as co-trustees, and such
other sums, if any, deposited with Landlord and Tenant as co-trustees pursuant
to this Paragraph 18, shall be insufficient to pay the entire cost of the
Restoration, Tenant agrees to pay any deficiency promptly upon demand so long
as Tenant has participated in the adjustment of the insurance proceeds;
provided, however, Landlord shall retain ultimate control over any final
adjustment with the property insurer, and provided further that notwithstanding
that the insurance moneys are insufficient to pay the cost of the Restoration,
Tenant shall continue to be liable for full payment of Base Rent, Additional
Rent and any other amounts due and payable hereunder. Upon completion of the
Restoration and payment in full thereof by Tenant, Landlord shall within a
reasonable period of time thereafter, turn over to Tenant all insurance moneys
or other moneys then remaining upon submission of proof reasonably satisfactory
to Landlord that the Restoration has been paid for in full and the damaged or
destroyed Building and other improvements repaired, restored or rebuilt as
nearly as possible to the condition they were in immediately prior to such
damage or destruction, or with such changes or alterations as may be made in
conformity with Paragraphs 8 and 18A hereof.
C. No destruction of or damage to the Demised Premises, or any portion
thereof, by fire, casualty or otherwise shall permit Tenant to surrender
this Lease or shall relieve Tenant from its liability to pay to Landlord the
Base Rent and Additional Rent payable under this Lease
21
47
or from any of its other obligations under this Lease, and Tenant waives any
rights now or hereafter conferred upon Tenant by present or future law or
otherwise to quit or surrender this Lease or the Demised Premises, or any
portion thereof, to Landlord or to any suspension, diminution, abatement or
reduction of rent on account of any such damage or destruction.
D. Landlord agrees, subject to the provisions of Paragraphs 8 and 18
hereof, to in all instances turn over and make available to Tenant all
insurance moneys contemplated by Paragraph 18B hereof.
19. Condemnation
A. If, during the term of this Lease, the entire Demised Premises shall
be taken as the result of the exercise of the power of eminent domain
(hereinafter referred to as the "Proceedings"), this Lease and all right,
title and interest of Tenant hereunder shall cease and come to an end on the
date of vesting of title pursuant to such Proceedings and Landlord shall be
entitled to and shall receive the total award made in such Proceedings;
provided that Tenant shall have the right to state a claim separate from
Landlord's claim against the condemning authority for Tenant's moving costs and
the loss of the bargain of this Lease, to the extent that such a claim by
Tenant does not otherwise reduce Landlord's award.
In any taking of the Demised Premises, or any portion thereof, whether or
not this Lease is terminated as in this Paragraph provided, Tenant shall not be
entitled to any portion of the award for the taking of the Demised Premises or
damage to the Improvements, except as otherwise provided for in Paragraph 19C
with respect to the restoration of the Improvements, or for the estate or
interest of Tenant therein, all such award, damages, consequential damages and
compensation being hereby assigned to Landlord, and Tenant hereby waives any
right it now has or may have under present or future law to receive any
separate award of damages for its interest in the Demised Premises, or any
portion thereof, or its interest in this Lease, except that Tenant shall have,
nevertheless, the limited right to prove in the Proceedings and to receive any
award which may be made for damages to or condemnation of Tenant's movable trade
fixtures and equipment, and for Tenant's relocation costs in connection
therewith.
B. If, during the initial term of this Lease, or any extension or renewal
thereof, less than the entire Demised Premises, but more than 15% of the floor
area of the Building, or more than 25% of the land area of the Demised
Premises, or more than 20% of the parking spaces, shall be taken in any such
Proceedings, this Lease shall, upon vesting of title in the Proceedings,
terminate as to the portion of the Demised Premises so taken, and Tenant may,
at its option, terminate this Lease as to the remainder of the Demised
Premises. Tenant shall not have the right to terminate this Lease pursuant to
the preceding sentence unless (a) the business of Tenant conducted in the
portion of the Demised Premises taken cannot reasonably be carried on with
substantially the same utility and efficiency in the remainder of the Demised
Premises (or any substitute space securable by Tenant pursuant to clause (b)
hereof) and (b) Tenant cannot construct or secure or Landlord cannot provide
substantially similar space to the space so taken, on the remainder of the
Demised Premises, or Landlord cannot provide replacement parking spaces on
additional property located in close proximity to the Demised Premises that are
reasonably acceptable to Tenant. Such termination as to the remainder of the
Demised Premises shall be effected by notice in writing given not more than 60
days after the date of vesting of title
22
48
in such Proceedings, and shall specify a date not more than 60 days after the
giving of such notice as the date of such termination. Upon the date specified
in such notice, the term of this Lease, and all right, title and interest of
Tenant hereunder, shall cease and come to an end. If this Lease is terminated as
in this Paragraph 19B provided, Landlord shall be entitled to and shall receive
the total award made in such Proceedings, Tenant hereby assigning any interest
in such award, damages, consequential damages and compensation to Landlord, and
Tenant hereby waiving any right Tenant has now or may have under present or
future law to receive any separate award of damages for its interest in the
Demised Premises, or any portion thereof, or its interest in this Lease except
as otherwise provided in Paragraph 19A. The right of Tenant to terminate this
Lease, as in this Paragraph 19B provided, shall be exercisable only upon
condition that Tenant is not then in default in the performance of any of the
terms, covenants or conditions of this Lease on its part to be performed, and
such termination upon Tenant's part shall become effective only upon compliance
by Tenant with all such terms, covenants and conditions to the date of such
termination. In the event that Tenant elects not to terminate this Lease as to
the remainder of the Demised Premises, the rights and obligations of Landlord
and Tenant shall be governed by the provisions of Paragraph 19C hereof.
C. If 15%, or less, of the floor area of the Building, or 25%, or less,
or the land area of the Demised Premises or 20% or less, of the parking spaces
shall be taken in such Proceedings, or if more than 15% of the floor area of the
Building or more than 25% of the land area of the Demised Premises or more than
20% of the parking spaces is taken (but less than the entire Demised Premises),
and this Lease is not terminated as in Paragraph 19B hereof provided, this Lease
shall, upon vesting of title in the Proceedings, terminate as to the parts so
taken, and Tenant shall have no claim or interest in the award, damages,
consequential damages and compensation, or any part thereof except as otherwise
provided in Paragraph 19A. Landlord shall be entitled to and shall receive the
total award made in such Proceedings, Tenant hereby assigning any interest in
such award, damages, consequential, damages and compensation to Landlord, and
Tenant hereby waiving any right Tenant, has now or may have under present or
future law to receive any separate award of damages for its interest in the
Demised Premises, or any portion thereof, or its interest in this Lease except
as otherwise provided in Paragraph 19A. The net amount of the award (after
deduction of all costs and expenses, including attorney's fees), shall be held
by Landlord as trustee and applied as hereinafter provided. Tenant, in such
case, covenants and agrees, at Tenant's sole cost and expense (subject to
reimbursement to the extent hereinafter provided), promptly to restore that
portion of the Improvements on the Demised Premises not so taken to a complete
architectural and mechanical unit for the use and occupancy of Tenant as in this
Lease provided. In the event that the net amount of the award (after deduction
of all costs and expenses, including attorney's fees) that may be received by
Landlord and held by Landlord as trustee in any such Proceedings as a result of
such taking is insufficient to pay all costs of such restoration work, Tenant
shall deposit with Landlord as trustee such additional sum as may be required
upon the written request of Landlord so long as Tenant has participated in the
Proceedings or otherwise provide reasonably adequate assurances to Landlord that
Tenant has the financial resources to fund such additional sum; provided,
however, Landlord shall retain ultimate control over any final settlement or
litigation with the condemning authority, and provided further that
notwithstanding that the net amount of the award may be insufficient to pay all
costs of the restoration work. Tenant shall continue to be liable for payment of
Base Rent. Additional Rent and any other amount due and payable hereunder, which
amounts shall not be abated except as provided in Paragraph 19E below. The
23
49
provisions and conditions in Paragraph 8 applicable to changes and alterations
shall apply to Tenant's obligations to restore that portion of the Improvements
to a complete architectural and mechanical unit. Landlord agrees in connection
with such restoration work to apply so much of the net amount of any award
(after deduction of all costs and expenses, including attorney's fees) that may
be received by Landlord and held by Landlord as trustee in any such Proceedings
as a result of such taking to the costs of such restoration work thereof and the
said net award as a result of such taking shall be paid out from time to time to
Tenant, or on behalf of Tenant, as such restoration work progresses upon the
written request of Tenant, which shall be accompanied by a certificate of the
architect or the registered professional engineer in charge of the restoration
work stating that (a) the sum requested is justly due to the contractors,
subcontractors, materialmen, laborers, engineers, architects or other persons,
firms or corporations furnishing or supplying work, labor, services or materials
for such restoration work or as is justly required to reimburse Tenant for
expenditures made by Tenant in connection with such restoration work, and when
added to all sums previously paid out by Landlord as trustee does not exceed the
value of the restoration work performed to the date of such certificate; and (b)
the net amount of any such award as a result of such taking remaining in the
hands of Landlord, together with the sums, if any, deposited by Tenant with
Landlord as trustee pursuant to the provisions hereof, will be sufficient upon
the completion of such restoration work to pay for the same in full. If payment
of the award as a result of such taking, as aforesaid, shall not be received by
Landlord in time to permit payments as the restoration work progresses (except
in the event of an appeal of the award by Landlord), Tenant shall not be
required to proceed with any restoration work until payment of such award is
received by Landlord; provided, however, delay in payment of such amount shall
not release Tenant of its obligation to pay Base Rent, Additional Rent and other
amounts due and payable hereunder during any such delay and there shall be no
abatement of Base Rent, Additional Rent or any other amounts except as provided
in Paragraph 19E below. If Landlord appeals an award and payment of the award is
delayed pending appeal Tenant shall, nevertheless, perform and fully pay for
such work without delay, and payment of the amount to which Tenant would have
been entitled had Landlord not appealed the award (in an amount not to exceed
the net award prior to such appeal) shall be made by Landlord to Tenant as
restoration progresses pursuant to this Paragraph 19C, in which event Landlord
shall be entitled to retain an amount equal to the sum disbursed to Tenant
pursuant to the preceding sentence out of the net award as and when payment of
such award is received by Landlord. Tenant shall also furnish Landlord as
trustee with each certificate hereinabove referred to, together with evidence
reasonably satisfactory to Landlord that there are no unpaid bills in respect to
any work, labor, services or materials performed, furnished or supplied, or
claimed to have been performed, furnished or supplied, in connection with such
restoration work [relating to prior payments made by Landlord to Tenant], and
that no liens have been filed against the Demised Premises, or any portion
thereof. Landlord as trustee shall not be required to pay out any funds when
there are unpaid bills for work, labor, services or materials performed,
furnished or supplied in connection with such restoration work relating to prior
payments made by Landlord to Tenant, or where a lien for work, labor, services
or materials performed, furnished or supplied has been placed against the
Demised Premises, or any portion thereof. Upon completion of the restoration
work and payment in full therefor by Tenant, and upon submission of proof
reasonably satisfactory to Landlord that the restoration work has been paid for
in full and that the Improvements have been restored or rebuilt to a complete
architectural and mechanical unit for the use and occupancy of Tenant as
provided in this Lease, Landlord as trustee shall pay over to Tenant any portion
of the cash deposit furnished by Tenant then remaining; provided, however, any
other amounts awarded
24
50
in such Proceedings (and made available for restoration) which remain following
restoration of the Demised Premises shall be the property of Tenant and Landlord
shall have no claim thereto.
D. In the event of any partial termination of this Lease as a result of
any such Proceedings, Tenant shall pay to Landlord all Base Rent and all
Additional Rent and other charges payable hereunder with respect to that
portion of the Demised Premises so taken in such Proceedings with respect to
which this Lease shall have terminated justly apportioned to the date of such
termination. From and after the date of vesting of title in such Proceedings,
Tenant shall continue to pay the Base Rent and Additional Rent and other
charges payable hereunder, as in this Lease provided, to be paid by Tenant,
subject to abatement, if any, as provided for in Paragraph 19E hereof.
E. In the event of a partial taking of the Demised Premises under
Paragraph 19C hereof, or a partial taking of the Demised Premises under
Paragraph 19B hereof, followed by Tenant's election not to terminate this
Lease, the fixed Base Rent payable hereunder during the period from and after
the date of vesting of title in such Proceedings to the termination of this
Lease shall not be reduced unless Tenant shall have completed the restoration
work with its own funds in accordance with the provisions of the Lease and
Landlord shall have applied the net amount of any award to reduce the
indebtedness secured by any financing encumbering the Demised Premises or
otherwise to reduce the amount for Landlord's Development Costs (as herein
defined), in which event fixed Base Rent payable hereunder shall be reduced to
a sum equal to the product of the Base Rent provided for herein multiplied by a
fraction, the numerator of which shall be Landlord's Development Costs less
any amounts so paid to and applied by Landlord less Tenant's $2,000,000
contribution, and the denominator of which shall be Landlord's Development
Costs less Tenant's $2,000,000 contribution without regard to any amounts so
paid and applied by Landlord.
F. Anything herein to the contrary notwithstanding, upon the occurrence
of any Proceedings which would otherwise result in a termination of this Lease,
Tenant shall, as a condition precedent to such termination so long as Tenant
has participated in such Proceedings, (provided, however, Landlord shall retain
ultimate control over any final settlement or litigation with the condemning
authority), pay to Landlord an amount, reasonably estimated by Landlord, equal
to the excess, if any, of the unamortized portion of Landlord's Development
Costs, less the $2,000,000 referred to below, over the net award to be received
by Landlord after deduction of all costs of the Proceedings. In making the
foregoing calculation, Landlord shall use an interest rate equal to the
interest rate associated with the project financing from time to time during
the term of this Lease. "Landlord's Development Costs" shall mean and include
any and all amounts incurred by Landlord in connection with the acquisition and
development of the Demised Premises, including, without limitation,
consideration paid for acquisition of the Demised Premises, costs for required
off-site improvements, including relocating electric lines underground, all
architectural, engineering, environmental, land planning and other consulting
fees, all title and survey expenses, any and all fees and expenses associated
with procuring construction and/or other financing for the project, any other
costs or expenses that would not have been incurred by Landlord had Landlord
not been involved in the acquisition of the Demised Premises, and all attorneys'
fees associated with any of the foregoing. A preliminary estimate of
Landlord's Development Costs (which includes Tenant's initial contribution of
$2,000,000 as deposited into escrow under Paragraph 3) is attached hereto and
made a part
25
51
hereof as Exhibit G; provided, however, the parties agree and acknowledge that
the amounts and categories of costs and expenses set forth on Exhibit G
represent an estimate of such items only, and that Landlord anticipates changes
in, additions to and modifications of such items, including, without limitation,
changes, additions and modifications of such items as development of the project
and construction of the Demised Premises progresses including, without
limitation, changes, additions and modifications relating to actual design and
construction costs, and in securing construction and permanent financing for the
project from time to time. The parties agree to update the estimate provided for
in Exhibit G within sixty (60) days after the Commencement Date and attach the
updated Exhibit G initialled and dated by the parties in place of the Exhibit G
attached as of the date hereof.
20. Default by Tenant. The occurrence of any one or more of the following
events shall constitute an "Event of Default" by Tenant:
A. The failure by Tenant to make any payment of rental or any other
payment required to be made by Tenant hereunder, and any interest for late
payment thereof, as and when due, where such failure shall continue for a
period of five (5) days after receipt by Tenant of a written notice thereof
from Landlord.
B. The failure by Tenant to observe or perform any of the covenants,
conditions or provisions of this Lease (other than the failure by Tenant
described in subparagraph B below) where such failure shall continue for a
period of thirty (30) days after receipt by Tenant of written notice thereof
from Landlord; provided, however that if the nature of Tenant's default is such
that it cannot be cured solely by payment of money (and in the reasonable
judgment of Landlord said default is susceptible to cure) and that more than
thirty (30) days may be reasonably required for such cure, then Tenant shall not
be deemed to be in default if Tenant shall commence such cure within such
thirty (30) day period and shall thereafter diligently prosecute such cure to
completion.
C. (a) the making of any general arrangement or any assignment by Tenant
for the benefit of creditors;
(b) the filing by or against Tenant of a petition to have Tenant
adjudged a bankrupt or a petition of reorganization or arrangement under
any law relating to bankruptcy (unless, in the case of a petition filed
against Tenant, the petition is dismissed within ninety (90) days of the
date filed);
(c) the appointment of a trustee or receiver to take possession of
substantially all of Tenant's assets; and
(d) the attachment, execution or other judicial seizure of
substantially all of Tenant's assets.
D. An assignment or subletting by Tenant in violation of Paragraph 14
hereof.
E. The failure by Tenant in keeping, observing or performing any of the
terms contained in this Lease, other than those referred to in Subparagraphs 00
X,X,X and D above, and which exposes Landlord to criminal liability, and such
default shall continue after written
26
52
notice thereof given by Landlord to Tenant, and Tenant fails to proceed timely
and promptly with all due diligence and in good faith to cure the same and
thereafter to prosecute the curing of such default with all due diligence, it
being intended that in connection with a default which exposes Landlord to
criminal liability that Tenant shall proceed immediately to cure or correct such
condition with continuity and with all due diligence and in good faith.
21. Landlord's Remedies. In the event of any Material Breach of this
Lease by Tenant, then Landlord, in addition to other rights or remedies it may
have, shall have the right to terminate this Lease, or without terminating this
Lease, terminate Tenant's right to possession of the Demised Premises, and in
either event Tenant shall immediately surrender possession of the Demised
Premises to Landlord and if Tenant fails to do so, Landlord may, without
prejudice to any other remedy it may have for possession or arrearage of
rentals, enter upon and take possession of the Demised Premises and expel or
remove Tenant and any other person who may be occupying the Demised Premises or
any part thereof, with or without legal proceedings, by force if necessary,
without being liable for prosecution or any claim or damage therefor. In such
event, Landlord shall be entitled to recover from Tenant all reasonable damages
incurred by Landlord by reason of Tenant's default, including without
limitation, the cost of recovering possession of the Demised Premises, expenses
of reletting including reasonable renovation and alteration of the Demised
Premises, reasonable attorneys' fees, real estate commissions, and any other
sum of money, late charges and damages caused by Tenant to Landlord. As used
herein, "Material Breach" shall mean any breach by Tenant in any of the terms
and conditions of this Lease which upon an Event of Default would have a
material and adverse impact of any kind upon Landlord and/or the Demised
Premises, as opposed to a technical breach by Tenant which is de minimis in
nature.
If Tenant's right to possession of the Demised Premises is terminated
without termination of the Lease, Landlord shall be entitled to enforce all of
Landlord's rights and remedies under the Lease, including the right to recover
the rent as it becomes due hereunder. Should Landlord elect to relet the
Demised Premises or any part thereof, Landlord may do so for such term or terms
and at such rental or rentals and upon such other terms and conditions as
Landlord may deem appropriate. Rental and other amounts received by Landlord in
connection with such reletting shall be applied against the amounts due from
Tenant hereunder after deducting any expenses incurred by Landlord with respect
to such reletting as provided above. Tenant shall pay any deficiency to
Landlord. Such deficiency shall be calculated on a cumulative basis with all
excess payments received by Landlord from such reletting to be applied against
future amounts due from Tenant and any deficiencies to be paid monthly. No such
reentry or taking possession of the Demised 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, in which event Tenant's obligations
to Landlord shall forthwith cease, or unless the termination thereof be decreed
by a court of competent jurisdiction.
In the event Landlord terminates this Lease in accordance with this
Paragraph, then, Tenant shall be liable and shall pay to Landlord, the sum of
all rent and other payments owed to date to Landlord, all sums owed to date to
third parties (including without limitation, all Impositions) hereunder accrued
to the date of such termination, all reasonable amounts required to be spent by
Landlord to fulfill any of Tenant's obligations which Tenant did not fulfill
prior to termination by Landlord, plus, as damages, an amount equal to the
present value discounted at
27
53
ten percent (10%) of (i) the total rental payments hereunder for the remaining
portion of the term of the Lease, calculated as if such term expires on the
date set forth in Paragraph 2, unless Tenant has extended this Lease, in which
case such calculation shall be as if the term expires on the final day of the
extension term then in effect, less (ii) the fair market rental value of the
Demised Premises for such remaining period. Nothing herein contained shall
limit or prejudice the right of Landlord to prove for and obtain, as damages by
reason of such expiration or termination, an amount equal to the maximum
allowed by any statute or rule of law in effect at the time when, and governing
the proceedings in which, such damages are to be proved, whether or not such
amount be greater, equal to or less than the amount of the difference referred
to above.
Landlord shall have the obligation to mitigate its damages to the extent
required by state law.
In addition to the aforesaid remedies, Landlord shall be entitled to
pursue any other remedy now or hereafter available to Landlord at equity or
under the laws or judicial decisions of the state where the Demised Premises is
located or by statute or otherwise. All rights and remedies of Landlord herein
enumerated shall be cumulative, and the exercise or the commencement of the
exercise by Landlord of any one or more of such rights or remedies should not
preclude the simultaneous or later exercise by Landlord of any or all other
rights or remedies. Tenant shall pay, upon demand, all of Landlord's costs,
including reasonable attorney's fees and court costs, incident to the
enforcement of Tenant's obligations hereunder. A receipt by Landlord of rent
with knowledge of the breach of any covenant hereof (other than breach of the
obligation to pay the portion of such rent paid) shall not be deemed a waiver
of such breach, and no waiver by Landlord of any provisions of this Lease shall
be deemed to have been made unless expressed in writing and signed by Landlord.
Without limiting the generality of the foregoing, no failure by Landlord to
insist upon the performance of any of the terms of this Lease or to exercise
any right or remedy consequent upon a breach thereof shall constitute a waiver
of such breach or any of the terms of this Lease, and no express waiver shall
affect any default other than the default specified in the express waiver and
that only for the time and to the extent therein stated. One or more waivers by
Landlord shall not be construed as a waiver of a subsequent breach of the same
covenant, term or condition. In addition to other remedies in this Lease
provided, Landlord shall be entitled to seek a restraint by injunction of the
violation or attempted or threatened violation of the covenants, conditions and
provisions of this Lease.
22. Default by Landlord. The following shall constitute a "Material
Breach" by Landlord:
The failure by Landlord to observe or perform any of the covenants,
conditions or provisions of this Lease where such failure shall continue for a
period of thirty (30) days after receipt by Landlord of written notice thereof
from Tenant; provided, however, that if the nature of Landlord's default is
such that it cannot be cured solely by payment of money and that more than
thirty (30) days may be reasonably required for such cure, then Landlord shall
not be deemed to be in default if Landlord shall commence such cure within such
thirty (30) day period and shall thereafter diligently prosecute such cure to
completion.
23. Tenant's Remedies. In the event of any Material Breach of this Lease
by Landlord, then Tenant in addition to other rights or remedies it may have at
law or in equity
28
54
(subject to the terms of this Lease), at Tenant's sole option, may perform such
obligations of Landlord provided that Tenant has furnished to any party having a
recorded mortgage, deed of trust, ground lease or similar lien against the
Demised Premises (for which Tenant has received written notice) with written
notice of such default and such party has failed to cure the same within the
limits prescribed herein for Landlord to cure such default, and Tenant may
invoice Landlord for the costs and expenses thereof, which invoice Landlord
shall promptly pay. Notwithstanding the foregoing, despite such notice and
expiration of such cure period, no rent or other payments due from Tenant may
be offset by Tenant, and Tenant shall have no right to perform any obligation
of Landlord unless such performance by Tenant is necessary to prevent imminent
injury or damage to persons or Tenant's property.
24. Delivery of Executed Lease. Deleted by intent of parties.
25. Termination. Deleted by intent of parties
26. Notices. All notices shall be sent by registered mail, return receipt
requested, or by recognized overnight courier providing proof of delivery, to
the following addresses:
To Landlord: To Tenant:
Sunnyvale Limited Partnership First Data Merchant Service
Ridge Sunnyvale, Inc., Corporation
c/o Ridge Capital Corporation Attention: Xxxxx X. Xxxxxxxxxx,
Attention: Xxxxx X. Xxxxxxx Director of Real Estate
000 Xxxx Xxxx Xxxxxx xxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000 0000 Xxx Xxxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
With a copy to: With a copy to:
Xxxxxxx, Carton & Xxxxxxx First Data Merchant Services
Attention: Xxxxx X. Xxxx Corporation
000 Xxxxx Xxxxx Xxxxxx Attention: Xxxxx X. Xxxxxx, President
Suite 3400 000 Xxxxxx Xxx
Xxxxxxx, Xxxxxxxx 00000-0000 Xxxx Xxxx, XX 00000
Any notice shall be deemed to have been given three (3) days after the
date deposited in the United States mail, or on the first business day after
sending when delivery by recognized overnight courier providing proof of
delivery, in the manner aforesaid.
Either party, by written notice to the other, shall have the right to
change the addresses for notice(s) to be sent to such party, and to add or
substitute entities to which a copy of any notice shall be sent by the other
party.
29
55
27. Brokerage. Landlord and Tenant acknowledge that no real estate broker
brought about this lease transaction. Landlord hereby indemnifies Tenant against
the claims of any party claiming by, through or under Landlord in connection
with this Lease transaction, and Tenant hereby indemnifies Landlord against the
claims of any party claiming by, through or under Tenant in connection with this
Lease transaction.
28. Estoppel. Landlord and Tenant shall, at any time upon not less than
twenty (20) days prior to written notice, execute and deliver to a prospective
new landlord, lender, or assignee or subtenant of Tenant, as the case may be, 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 the party's knowledge, any uncured
defaults on the part of the other party hereunder, or so specifying such
defaults if any are claimed, and (iii) other reasonable requests that relate to
the Lease.
29. Hazardous Substances.
A. For purposes of this Paragraph 29, "Hazardous Substance" means:
(i) "Hazardous Substances" as defined by the Comprehensive
Environmental Response, Compensation and Liability Act ("CERCLA"), 42
U.S.C. Section 9601 et seq., as amended, and all regulations promulgated
thereunder, the Federal Clean Air Act, as amended (42 U.S.C. Section 7401
et seq.) and the Federal Water Pollution Control Act ("FWPCA"), 33 U.S.C.
Section 1317 et seq. as amended and all regulations promulgated thereunder;
(ii) "Hazardous Waste" as defined by the Resource Conservation
and Recovery Act ("RCRA"), 42 U.S.C. Section 6602 et seq. as amended and
all regulations promulgated thereunder;
(iii) Any pollutant or contaminant or hazardous, dangerous or
toxic chemicals, materials or substances within the meaning of any other
applicable federal, state or local law, regulation, ordinance or
requirement (including consent decrees and administrative orders) relating
to or imposing liability or standards of conduct concerning any hazardous,
toxic or dangerous waste, substance or material, all as amended or
hereafter amended;
(iv) More than 100 gallons of crude oil which is liquid at
standard conditions of temperature and pressure (80 degrees Fahrenheit and
14.7 pounds per square inch absolute);
(v) Any radioactive material, including any source, special
nuclear or by-product material as defined in 42 U.S.C. Section 2011 et seq.
as amended or hereafter amended, and all regulations promulgated
thereunder;
30
56
(vi) Friable asbestos or any asbestos which becomes friable
during the term of this Lease; and
(vii) Anything defined as a hazardous, toxic or radioactive
material, waste or substance or the use, transportation or disposal of
which is regulated under applicable California laws or rules and
regulations issued pursuant thereof;
(all of the forgoing statutes, laws, ordinance, rules, regulations, and
common law theories being sometimes hereinafter collectively referred to as
"Envlaws").
B. Landlord and Tenant acknowledge the environmental condition of the
Land as described in that certain Site Management Plan prepared by Geomatrix
Consultants dated September 5, 1996, a copy of which Landlord has provided to
Tenant. Prior to the Construction Completion Date, Landlord shall cause to be
performed all asbestos and soil removal and disposal or other remediation
provided for under and in compliance with Section 4.4.7 of the Sale Agreement,
as well as all additional environmental clean-up of Hazardous Substances as
required by Section 4.4.7 of the Sale Agreement. Landlord shall indemnify,
defend and hold Tenant harmless from all damages, costs, losses, expenses
(including but not limited to reasonable attorneys' fees and engineering fees)
arising from any breach by Landlord of the preceding covenant; provided
however, the foregoing indemnification shall terminate upon the expiration of
one (1) year from the Construction Completion Date. Notwithstanding the
foregoing, in no event shall Tenant have the right to terminate this Lease or
have any right of set-off arising out of any breach or claimed breach by
Landlord in its obligations hereunder, it being expressly acknowledged and
agreed that the Base Rent and Additional Rent, and all other charges and sums
payable by Tenant hereunder, shall commence at the times provided herein and
shall continue to be payable as provided under this Lease.
C. Tenant shall not allow any Hazardous Substance to be brought on to
the Demised Premises and shall not conduct or authorize the generation,
transportation, storage, treatment or disposal at the Demised Premises, of any
Hazardous Substance other than in quantities incidental to the conduct of
Tenant's Use and in compliance with Envlaws; provided, however, nothing herein
contained shall permit Tenant to allow any so-called "acutely hazardous",
"ultra-hazardous", "imminently hazardous chemical substance or mixture" or
comparable Hazardous Substance to be located on or about the Demised Premises.
D. If the presence, release, threat of release, placement on or in the
Demised Premises, or the generation, transportation, storage, treatment, or
disposal at the Demised Premises of any hazardous substances as a result of
Tenant's operations at the Demised Premises: (i) gives rise to liability
(including, but not limited to, a responses action, remedial action, or removal
action) under Envlaws, (ii) causes a significant public health effect, or (iii)
pollutes or threatens to pollute the environment, Tenant shall promptly take
any and all remedial and removal action necessary to clean up the Demised
Premises and mitigate exposure to liability arising from the hazardous
substance, whether or not required by law.
E. Tenant shall indemnify, defend and hold Landlord harmless from all
damages, costs, losses, expenses (including, but not limited to, actual
attorneys' fees and engineering fees) arising from or attributable to the
existence of any hazardous substances at the Demised Premises
31
57
as a result of Tenant's Operations at the Demised Premises, and (ii) any
breach by Tenant of any of its covenants in this Paragraph 29.
F. Upon request by Landlord during the term of this Lease, prior to the
exercise of any Extension Term, Tenant shall undertake and submit to Landlord
an environmental audit from an environmental consulting firm reasonably
acceptable to Landlord which audit shall evidence Tenant's compliance with this
Paragraph 29. Tenant shall bear the cost of such environmental audit unless
such audit discloses that Tenant has complied with the provisions of this
Paragraph 29 in which event Landlord shall pay for such audit.
G. Landlord or Tenant shall give the other prompt written notice upon
discovery of any Hazardous Substance at or adjacent to the Demised Premises.
Landlord and Tenant's obligations under this Paragraph 29 shall survive
termination of the Lease.
30. Holdover. Should Tenant continue to occupy the Demised Premises
after expiration of the term or any renewal thereof and provided Landlord has
notified Tenant thirty (30) days prior to the expiration of the term or any
renewal term that Landlord is negotiating or has executed a lease with a
third party for the Demised Premises or any portion thereof, Tenant shall be
deemed to be occupying the Demised Premises without claim or right and Tenant
shall pay Landlord all costs arising out of loss or liability resulting from
delay by Tenant in so surrendering the Demised Premises as above provided and
shall pay a charge for each day of occupancy an amount equal to 150% the Base
Rent (on a per diem basis) then reserved hereunder. In the event Landlord has
failed to notify Tenant in writing within thirty (30) days prior to the
expiration of the term or any renewal term that Landlord is negotiating or has
executed a lease with a third party for the Demised Premises or any portion
thereof, Tenant shall be entitled to occupy the Demised Premises for a period
of sixty (60) days following expiration of the term or any renewal term on the
same terms and conditions as such term or renewal term (including Base Rental
and additional rental). Should Tenant continue to occupy the Demised Premises
following such sixty (60) day period, Tenant shall be deemed to be occupying
the Demised Premises without claim or right and Tenant shall pay Landlord as a
full measure of all loss or liability resulting from delay by Tenant in so
surrendering the Demised Premises as above provided a charge for each day of
occupancy an amount equal to 200% of the Base Rent and Additional Rent (on a
per diem basis) then reserved hereunder.
31. Surrender.
A. Upon any termination or expiration of this Lease, Tenant shall
surrender the Demised Premises in the same condition as existed at the
Commencement Date, except for normal wear and tear and damage caused by the fire
or other casualty; provided, however, that nothing in this Paragraph 31 is
intended to change or diminish Tenant's obligations under any other part of this
Lease. Tenant shall remove the Alterations it is required to remove pursuant to
the terms of Paragraph 8 hereof. Any damage to the Demised Premises resulting
from the removal of such Alterations shall be repaired by Tenant at Tenant's
expense. If the Demised Premises be not surrendered as above set forth, Tenant
shall indemnify, defend and hold Landlord harmless against loss or liability
resulting from the delay by Tenant in so surrendering the Demised Premises,
including, without limitation any claim made by any succeeding occupant founded
on such delay.
32
58
All property of Tenant not removed on or before the last day of the term
of this Lease (subject to Tenant's right to occupy the Demised Premises
following expiration of the term of this Lease as set forth in Paragraph 30
hereof) or within fifteen (15) days thereafter shall be deemed abandoned.
Tenant hereby appoints Landlord its agent to remove all property of Tenant from
the Demised Premises upon termination of this Lease and to cause its
transportation and storage for Tenant's benefit, all at the sole cost and risk
of Tenant and Landlord shall not be liable for damage, theft, misappropriation
or loss thereof and Landlord shall not be liable in any manner in respect
thereto. Tenant shall pay all costs and expenses of such removal,
transportation and storage. Tenant shall reimburse Landlord upon demand for any
expenses incurred by Landlord with respect to removal or storage of abandoned
property and with respect to restoring said Demised Premises to good order,
condition and repair.
32. Liens. Landlord shall deliver the Demised Premises to Tenant free of
all mechanic's and materialmen's liens or bond over all such mechanic's and
materialmen's liens. Tenant has no authority, express or implied, to create or
place any lien or encumbrance of any kind or nature whatsoever upon, or in any
manner to bind the interest of Landlord or Tenant in the Demised Premises, or
to charge the rentals payable hereunder for any claim in favor of any person
dealing with Tenant, including those who furnish materials or perform labor
for any construction or repairs, and Tenant covenants and agrees that it shall
not mortgage, encumber or pledge this Lease or any interest therein. The
preceding sentence shall not be construed as prohibiting Tenant from making
Alterations as provided in Paragraph 8 above or form permitting any other
mechanics or materialmen's lienable work to be performed as long as such work
is not prohibited by this Lease. Tenant agrees to indemnify and hold Landlord
harmless from any lien filed against the Demised Premises on account of work
performed by or on behalf of Tenant and from any and all losses, costs, damages,
expenses, liabilities, suits, penalties, claims and damages (including
reasonable attorney fees) arising from or relating to such lien. After Tenant's
receipt of notice or actual knowledge of the placing of any lien or encumbrance
against the Demised Premises, Tenant shall immediately give Landlord written
notice thereof. Tenant shall within ten (10) days therefrom remove such lien by
payment or bond.
If Tenant shall fail to discharge such mechanic's lien within such period,
then, in addition to any other right or remedy of Landlord, Landlord may, but
shall not be obligated to, discharge the same by paying to the claimant the
amount claimed to be due by procuring the discharge of such lien as to the
Demised Premises by deposit in the court having jurisdiction of such lien, a
cash sum sufficient to secure the discharge of the same, or by the deposit of a
bond or other security with such court sufficient in form, content and amount to
procure the discharge of such lien, or in such other manner as is now or may in
the future be provided by present or future law for the discharge of such lien
as a lien against the Demised Premises. Any amount paid by Landlord, or the
value of any deposit so made by Landlord, together with all costs, fees and
expenses in connection therewith (including reasonable attorneys' fees of
Landlord), together with interest thereon at the rate set forth in Paragraph 33
hereof, shall be repaid by Tenant to Landlord on demand by Landlord and if
unpaid may be treated as Additional Rent.
All materialmen, contractors, artisans, mechanics, laborers and any other
person now or hereafter furnishing any labor, services, materials, supplies or
equipment to Tenant with respect to the Demised Premises, or any portion
thereof, are hereby charged with notice that they must
33
59
look exclusively to Tenant to obtain payment for the same. Notice is hereby
given that Landlord shall not be liable for any labor, services, materials,
supplies, skill, machinery, fixtures or equipment furnished or to be furnished
to Tenant upon credit, and that no mechanic's lien or other lien for any such
labor, services, materials, supplies, machinery, fixtures or equipment shall
attach to or affect the estate or interest of Landlord in and to the Demised
Premises, or any portion thereof.
33. Interest: Late Charge. Base Rent payable pursuant to Paragraph 3
hereof by Tenant to Landlord under this Lease, if not paid when due, and any
other charges payable by Tenant hereunder not paid when due, including any
charges, expenses, liabilities or fees in connection with a default by Tenant,
shall accrue interest at the rate of prime (as announced from time to time by
the First National Bank of Chicago) plus one percent (1%) per annum from the
due date until paid, said interest to be in addition to Base Rent and other
charges under this Lease and to be paid to Landlord by Tenant upon demand. In
addition, if any installment of Base Rent and other charges payable pursuant to
this Lease by Tenant to Landlord is not paid within five (5) days after receipt
by Tenant of a written notice thereof from Landlord, Tenant shall pay Landlord
a late charge in an amount equal to two percent (2%) of the amount then due to
defray the increased cost of collecting late payments.
34. Inspections. Landlord, its agents or employees may, after providing
Tenant with a least twenty-four (24) hours prior notice except in an emergency
situation, enter the Demised Premises during reasonable business hours when
accompanied by an authorized employee or agent of Tenant except in an emergency
situation, to (a) exhibit the Demised Premises to prospective purchasers or
lenders; (b) inspect the Demised Premises to see that Tenant is complying with
its obligations hereunder; and (c) exhibit the Demised Premises during the last
six (6) months of the term to prospective tenants; provided that Landlord shall
comply at all times with Tenant's reasonable security requirements.
35. Transfer of Landlord's Interest. Tenant acknowledges that Landlord
has the right to transfer its interest in the Demised Premises and in this Lease
at any time after the date which is eighteen (18) months after the Commencement
Date and subject to the provisions of Paragraph 52 hereof, and Tenant agrees
that in the event of any such transfer Landlord shall automatically be released
from all liability under this Lease except for any liabilities accruing prior to
the date of transfer for which Tenant has identified in an estoppel certificate
or by written notice to Landlord, and Tenant agrees to look solely to such
transferee for the performance of Landlord's obligations hereunder; provided,
however, any such transferee shall be deemed to have assumed the obligations of
Landlord hereunder subject to the conditions and limitations herein contained.
Tenant agrees to look solely to Landlord's interest in the Demised Premises for
the recovery of any judgment from Landlord, it being agreed that Landlord, or if
Landlord is a partnership, its partners whether general or limited, or if
Landlord is a corporation, its directors, officers or shareholders, or if
Landlord is a limited liability company, its members or managers, shall never be
personally liable for such judgment. Without limiting the generality of the
foregoing, Tenant agrees that Landlord may transfer its interest in this Lease
to any entity controlled by, controlling or under common control with Landlord,
that acquires the Demised Premises and from and after such transfer Landlord
shall be released from liability, as aforesaid.
34
60
36. Indemnity. (a) To the fullest extent allowed by law, Tenant shall at
all times indemnify, defend and hold Landlord harmless against and from any and
all claims by or on behalf of any person or persons, firm or firms, corporation
or corporations, arising from the conduct or management, or from any work or
things whatsoever done in or about the Demised Premises, and will further
indemnify, defend and hold Landlord harmless against and from any and all claims
arising during the term of this Lease, or arising from any breach or default on
the part of Tenant in the performance of any covenant or agreement on the part
of Tenant to be performed, pursuant to the terms of this Lease, or arising from,
any act or negligence of Tenant, its agents, servants, employees or licensees,
or arising from any accident, injury or damage whatsoever caused to any person,
firm or corporation occurring during the term of this Lease, in or about the
Demised Premises or upon the sidewalk and the land adjacent thereto, and from
and against all costs, attorneys' fees, expenses and liabilities incurred in or
about any such claim or action or proceeding brought thereon; and in case any
action or proceeding be brought against Landlord by reason of any such claim,
Tenant, upon notice from Landlord, covenants to defend such action or proceeding
by counsel reasonably satisfactory to Landlord. Tenant's obligations under this
Paragraph 36 shall be insured by contractual liability endorsement on Tenant's
policies of insurance required under the provisions of Paragraph 17 hereof.
(b) Landlord shall protect, indemnify and hold Tenant harmless from
and against any and all loss, claims, liability or costs (including court
costs and attorneys' fees) incurred by reason of: (a) any damage to any
property or any injury (including but not limited to death) to any person
occurring in, or on or about the Demised Premises or the Building to the
extent that such injury or damage shall be proximately caused by the
Landlord's affirmative acts of negligence or willful misconduct of Landlord
or its agents, servants or employees; provided, however, that such
indemnification shall be limited to the extent of the sum of: (i) amounts
of insurance proceeds recovered by Landlord under insurance policies
carried by Landlord for such injury or damage, after deductibles, or
insurance proceeds that would have been received in the event Landlord had
not elected to self-insure, and (ii) the deductible amounts for such claims
under such insurance policies. The provisions of this Article shall
survive the termination of this Lease with respect to any claims or
liability occurring prior to such termination.
(c) Notwithstanding the foregoing indemnification obligations,
Landlord and Tenant both hereby release the other and the other's officers,
directors, partners, employees and agents from any claim which the
indemnified party might have to the extent that the cost of any such claim
is reimbursed by insurance proceeds recovered by the releasing party, and
both Landlord and Tenant shall confirm that their insurance providers shall
similarly waive all such claims.
37. Modification of Lease. The terms, covenants and conditions of this
Lease may not be changed orally but only by an instrument in writing signed by
the party against whom enforcement of the change is sought. The failure of
either party hereto to insist in any one or more cases upon the strict
performance of any term, covenant or condition of this Lease to be
35
61
performed or observed by the other party hereto shall not constitute a waiver
of relinquishment for the future of any such term, covenant or condition.
38. Memorandum of Lease. Neither party shall record this Lease or any of
the exhibits and/or riders attached hereto, but shall enter into a "short form"
or Memorandum of Lease in recordable form attached hereto as Exhibit F and made
a part hereof, which shall set forth the parties, the legal description of the
land, a description of the Demised Premises, the Commencement Date and
Expiration Date of the term of the Lease, and any options to renew, options to
purchase or rights of first refusal granted hereunder.
39. Paragraph Captions. Paragraph captions herein are for Landlord's and
Tenant's convenience only, and neither limit nor amplify the provisions of this
Lease.
40. Entire Agreement. This Lease represents the entire agreement between
Landlord and Tenant and supersedes all prior agreements, both written and oral.
The terms, covenants and conditions of this Lease shall be binding upon and
shall inure to the benefit of Landlord and Tenant and their respective
executors, administrators, heirs, distributees, legal representatives,
successors and assigns.
41. Choice of Law and Interpretation. This Lease shall be governed by the
internal law of the State in which the Demised Premises is situated, without
considering such state's choice of law rules. Should any provision of this
Lease require judicial interpretation, it is agreed that the court interpreting
or construing the same shall not apply a presumption that the terms of any such
provision shall be more strictly construed against one party or the other by
reason of the rule of construction that a document is to be construed most
strictly against the party who itself or through its agent prepared the same, it
being agreed that the agents of all parties hereto have participated in the
preparation of this Lease.
42. Prevailing Party. If either party hereto files a lawsuit against the
other party relating to performance or non-performance under this Lease, and
the court has entered a judgment in favor of one party on one or more counts
and no judgment in favor of the other party on any counts, then the
non-prevailing party shall pay the prevailing party's reasonable attorneys'
fees and costs in connection with the lawsuit.
43. Exhibits. Attached hereto and made a part hereof are the following:
Exhibit A - Legal Description
Exhibit B - Site Plan
Exhibit C - Plans
Exhibit C-1 Construction Schedule
Exhibit D - Schedule of Rents
Exhibit E - Lease Term Agreement
Exhibit F - Memorandum of Lease
Exhibit G - Landlord's Development Costs
Exhibit H - Permitted Exceptions
Exhibit I - Escrow Agreement
36
62
44. Guarantee. All obligations on the part of Tenant to be paid,
performed and complied with are unconditionally guaranteed by First Data
Corporation (the "Guarantor") according to the provisions of the Guarantee
executed by Guarantor in a form prepared by Landlord.
45. Independent Covenants. It is the express intent of Landlord and
Tenant that (a) the obligations of Landlord and Tenant hereunder shall be
separate and independent covenants and agreements and that the Base Rent and
Additional Rent, and all other charges and sums payable by Tenant hereunder,
shall commence at the times provided herein and shall continue to be payable in
all events; (b) all costs or expenses of whatsoever character or kind, general
or special, ordinary or extraordinary, foreseen or unforeseen, and of every
kind and nature whatsoever that may be necessary or required in and about the
Demised Premises, or any portion thereof, and Tenant's possession or authorized
use thereof during the term of this Lease, shall be paid by Tenant and all
provisions of this Lease are to be interpreted and construed in light of the
intention expressed in this Paragraph 45; (c) the Base Rent specified in
Paragraph 3 shall be absolutely net to Landlord so that this Lease shall yield
net to Landlord the Base Rent specified in Paragraph 3 in each year during the
term of this Lease (unless extended or renewed at a different Base Rent); (d)
all Impositions, insurance premiums, utility expenses, repair and maintenance
expenses, and all other costs, fees, interest, charges, expenses,
reimbursements and obligations of every kind and nature whatsoever relating to
the Demised Premises, or any portion thereof, which may arise or become due
during the term of this Lease, or any extension or renewal thereof, shall be
paid or discharged by Tenant as Additional Rent.
46. Entry by Landlord. Subject to the provisions of Section 34 hereof,
Tenant agrees to permit Landlord or Landlord's mortgagee and authorized
representatives of Landlord or Landlord's mortgagee to enter upon the Demised
Premises at all reasonable times during ordinary business hours for the purpose
of inspecting the same and making any necessary repairs to comply with any laws,
ordinances, rules, regulations or requirements of any public body, or the Board
of Fire Underwriters, or any similar body; provided that Landlord shall comply
at all times with Tenant's reasonable security requirements. Nothing herein
contained shall imply any duty upon the part of Landlord to do any such work
which, under any provision of this Lease, Tenant may be required to perform and
the performance thereof by Landlord shall not constitute a waiver of Tenant's
default in failing to perform the same. Landlord may, during the progress of any
work, keep and store upon the Demised Premises all necessary materials, tools
and equipment. Landlord shall not in any event be liable for inconvenience,
annoyance, disturbance, loss of business or other damage to Tenant by reason of
making repairs or the performance of any work in or about the Demised Premises,
or on account of bringing material, supplies and equipment into, upon or through
the Demised Premises during the course thereof, and the obligations of Tenant
under this Lease shall not be thereby affected in any manner whatsoever;
provided, however, Landlord shall use all reasonable efforts to conduct any
entry into the Demised Premises so as to interfere with the business of Tenant
as little as reasonably practical under the circumstances.
47. [Deleted by intent of parties.]
48. Survival of Obligations. Except as otherwise provided herein to the
contrary, all obligations of Tenant hereunder not fully performed as of the
expiration or earlier termination of
37
63
the term of this Lease shall survive the expiration or earlier termination of
the term hereof for a period of one (1) year.
49. Lease Subject to Landlord's Acquisition of Demised Premises. Anything
herein to the contrary notwithstanding, it is agreed and acknowledged by the
parties hereto that as of the date hereof, Landlord does not own the Demised
Premises. Therefore, anything herein to the contrary notwithstanding, the
rights, duties and obligations of Landlord and Tenant hereunder are expressly
subject to and contingent upon acquisition by Landlord of the Demised Premises
by December 31, 1997 ("Contingency Date"), upon terms and conditions acceptable
to Landlord, in its sole and absolute discretion, including, without
limitation, procuring project financing on terms and conditions acceptable to
Landlord. In the event Landlord has not acquired the Demised Premises by the
Contingency Date on terms and conditions acceptable to Landlord, as aforesaid,
Landlord shall notify Tenant, and either party may terminate this Lease at
anytime thereafter (but prior to the date Landlord acquires the Demised
Premises) by delivering written notice of such termination to the other party,
whereupon the parties shall be released and discharged from any and all
obligations and liabilities not theretofore accrued under this Lease; provided,
however, in the event the Lease is so terminated, Tenant shall pay to Landlord,
within ten (10) days from the date Landlord has submitted a written statement
to Tenant requesting such payment, all amounts incurred by Landlord in
connection with the proposed acquisition and development of the Land,
including, without limitation, any xxxxxxx money deposit, any costs for required
off-site improvements, including sewer and road improvements, all
architectural, engineering, environmental, land planning and other consulting
fees, all title and survey expenses, all costs associated with the proposed
subdivision of the Land, any and all fees and expenses associated with
procuring construction and/or other financing for the project, any other costs
or expenses that would not have been incurred by Landlord had Landlord not been
involved in the acquisition and proposed development of the Land and all
attorneys' fees associated with any of the foregoing. Landlord agrees to use
all reasonable efforts to acquire the Demised Premises on terms and conditions
acceptable to Landlord, as aforesaid.
50. Americans With Disabilities Act.
A. In the event that any alteration or repair to the Demised Premises is
undertaken by Tenant with or without Landlord's consent, or is undertaken by
Landlord at Tenant's request during the term of this Lease (including any
renewal or extension thereof), such alteration or repair (i) shall be designed
and constructed in full compliance with the Americans With Disabilities Act, as
amended from time to time (the "Act") if such alteration or repair is
undertaken by Tenant, and (ii) shall be designed by Tenant in full compliance
with the Act if such alteration or repair is undertaken by Landlord at Tenant's
request, and the cost of any such design, alteration or repair to the Demised
Premises shall be borne by Tenant, including without limitation (a) the cost of
any such design, alteration or repair required as a result of (i) Tenant or an
assignee or subtenant being deemed a "Public Accommodation" or the Demised
Premises being deemed a "Place of Public Accommodation" or (ii) such alteration
or repair being deemed to affect an "Area of Primary Function" (as such terms
are defined in the Act); and (b) the cost of the installation or implementation
of any "Auxiliary Aid" required under the Act as a result of the operation of
any business within the Demised Premises. In addition, Tenant shall be
responsible for all costs and expenses incurred or to be incurred in order to
cause the Demised Premises and the operation of any business within the Demised
Premises to comply with the Act, and, if
38
64
Tenant fails to keep and maintain the Demised Premises in compliance with the
Act, Landlord shall have the right but not the obligation, at Tenant's sole
cost and expense, to enter the Demised Premises and cause the Demised Premises
to be put into compliance with the Act; and Tenant shall indemnify, defend and
hold Landlord harmless from and against any and all costs, claims and
liabilities, including without limitation, attorneys' fees arising from or
related to Tenant's failure to maintain and keep the Demised Premises in
compliance with the Act.
B. In connection with its construction of the Landlord's Improvements
pursuant to Paragraph 4 hereof, Landlord represents and warrants that the
Landlord's Improvements to be constructed in accordance with the Plans will
comply in all material respects with all applicable laws, including without
limitation, the Act, and Landlord covenants that the Demised Premises delivered
to Tenant as of the Construction Completion Date shall comply in all material
respects with all applicable laws, including without limitation, the Act.
Landlord shall indemnify, defend and hold Tenant harmless from all damages,
costs, losses, expenses (including but not limited to reasonable attorneys'
fees) arising from any breach by Landlord of the preceding covenant; provided
however the foregoing indemnification shall terminate upon the expiration of
one (1) year from the Construction Completion Date. Notwithstanding the
foregoing, in no event shall Tenant have the right to terminate this Lease or
have any right of set-off arising out of any breach or claimed breach by
Landlord in its obligations hereunder; it being expressly acknowledged and
agreed that the Base Rent and Additional Rent, and all other charges and sums
payable by Tenant hereunder, shall commence at the times provided herein and
shall continue to be payable as provided herein.
51. Reports by Tenant. Upon request by Landlord at any time after 135
days after the end of the applicable fiscal year of Tenant, Tenant shall deliver
to Landlord (within 15 days after receipt of written request) a copy of the
audited financial statement of any guarantor of Tenant's obligations under this
Lease. If such audited statements are not available, Tenant may provide such
statements certified by such guarantor's chief financial officer as being true
and correct, in accordance with generally accepted principals of accounting
consistently applied over the applicable periods. Said financial statements
shall only be required in connection with a proposed sale or mortgaging of the
Demised Premises and shall be held in confidence by Landlord and any such
proposed purchaser or lender or their respective successors or assigns.
Notwithstanding the foregoing, Tenant shall cause First Data Corporation to
submit annual audited financial statements to Landlord and Landlord's mortgagee
in the manner set forth herein if First Data Corporation ceases to be a publicly
traded company.
52. Option to Purchase. Subject to the provisions hereinafter set forth,
and provided that Tenant is not then in default hereunder, Landlord hereby
grants to Tenant the option to purchase the Demised Premises upon the following
terms and conditions:
A. Landlord shall notify Tenant thirty (30) days prior to the date that
it intends to make the Demised Premises available to sale to third parties.
Included with such notice shall be the proposed purchase price for the Demised
Premises, as well as any other relevant economic terms being offered by
Landlord. In no event shall Landlord have the right to convey the Demised
Premises or otherwise make the Demised Premises available for sale to third
parties until eighteen (18) months after the Commencement Date.
39
65
[ILLEGIBLE TEXT] enters into a serious negotiation with a prospective purchaser
to purchase the Demised Premises, then Landlord shall notify Tenant in writing
of (i) the fact of such negotiation, (ii) the purchase price agreed to between
Landlord and such prospective purchaser, and (iii) the other relevant
agreed-upon economic terms upon which such purchaser would acquire the Demised
Premises, and Tenant must within ten (10) business days thereafter, by written
notice to Landlord, elect to exercise the option to purchase the Demised
Premises upon all of the same terms and conditions as are contained in
Landlord's notice to Tenant in which event the parties shall enter into a
definitive agreement incorporating said terms and conditions. If Tenant does
not elect to purchase, Landlord shall have the right to sell to a third party
on the same terms and conditions provided to Tenant or shall submit any
modified terms to Tenant in accordance with the above. In no event shall Tenant
be afforded more than three (3) opportunities to exercise its option hereunder,
in connection with more than three (3) different offers from three (3)
different third parties.
C. If Tenant exercises its option to purchase hereunder, the closing of
such purchase shall occur on the date set forth in the definitive agreement
entered into between Landlord and Tenant. At the closing, Tenant shall pay the
purchase price via cash or wire transfer of immediately available funds to
Landlord, and Landlord shall deliver to Tenant a general warranty deed (or
equivalent) to the Demised Premises conveying good and marketable fee simple
title in Tenant to the Demised Premises, subject to no liens, encumbrances or
other exceptions to title other than the Permitted Exceptions and taxes for the
current year, and any exceptions to title that have been caused by Tenant or
that Tenant has accepted in writing (other than any mortgages or other liens,
which must be discharged by Landlord at or prior to such closing). On the
closing date, Landlord and Tenant shall also execute and deliver such other
documents and instruments as are customary in similar transactions and/or
reasonably necessary to implement the terms and conditions of this Lease, and
to allow Tenant to obtain an extended coverage ALTA owner's title policy
insuring Tenant's fee simple ownership of the Demised Premises in accordance
with the above.
D. Landlord covenants and agrees that if any exceptions to title other
than the Permitted Exceptions shall be revealed by the deed or title policy,
Landlord will at its sole cost and expense clear the title of such exceptions
as soon as reasonably practical but, in any event, within six (6) months after
the intended closing date (unless Tenant shall in writing extend such period),
and the actual closing (including the payment of the purchase price) of such
purchase of the Demised Premises shall be delayed until the title thereto has
been cleared. Until such time as Tenant's purchase of the Demised Premises is
closed as hereinabove provided, Tenant shall continue to occupy and possess the
Demised Premises under the terms and conditions of this Lease. If for any
reason such purchase is not closed, this Lease shall continue in full force and
effect as if Tenant had not exercised the aforesaid option to purchase, and
Tenant shall be entitled to retroactively exercise any option for any Extension
Term to the extent the normal option election date occurred after Tenant
exercised its option to purchase the Demised Premises.
E. Upon Tenant's notice to Landlord of the exercise of Tenant's option
to purchase, Landlord shall provide Tenant with copies of all surveys, title
insurance policies, title instruments and other such documents in Landlord's
possession pertaining to the Demised Premises. Tenant shall pay for the cost of
the title insurance policy, the cost to prepare any
40
66
[ILLEGIBLE] escrow or closing services, and any cost or expense in connection
with any endorsements to the title policy requested by Tenant. Landlord shall be
responsible for the cost of compliance with any subdivision, lot split or
similar regulations which are applicable to or in connection with the conveyance
of the Demised Premises to Tenant. All rents shall be pro-rated between the
parties as of the date of closing. Tenant shall pay the cost of any documentary
stamp taxes required for recording the deed, as well as any transfer taxes. Any
other matters at closing not specifically provided for herein shall be handled
and the cost hereof charged to one or the other or both parties as shall be the
ordinary custom and practice for the handling of such matters or the
apportioning of the cost hereof then prevalent in the City of Sunnyvale, Santa
Xxxxx County, California.
F. The option hereunder may only be exercised by Tenant or a subsidiary,
affiliate or related entity of Tenant. If neither Tenant or a subsidiary,
affiliate or related entity is then occupying all or a portion of the Demised
Premises, Tenant shall have no rights hereunder.
53. No Third Party Beneficiaries. The obligations of Tenant set forth
hereunder (including, without limitation, the obligations set forth in Sections
5A, 7A, 11B and 50), are covenants from Tenant to Landlord only and do not
create any third party beneficiaries of such obligations.
54. Counterparts. This lease may be executed in counterparts, each of
which shall be deemed an original but all of which together shall constitute but
one and the same instrument.
55. Consents and Approvals. Landlord and Tenant agree that any consents or
approvals to be provided by either party will not be unreasonably withheld or
delayed unless specifically provided otherwise herein.
56. Limitation on Damages. In no event shall Landlord or Tenant be liable
under any theory of tort, contract, strict liability or other legal or equitable
theory for any punitive, special, incidental, indirect or consequential
damages, each of which is hereby excluded by agreement of the parties regardless
of whether or not any party has been advised of the possibility of such damages.
57. Tenant's Property. All fixtures, equipment, improvements and
appurtenances attached to, or built into, the Demised Premises that are
installed by Tenant at Tenant's expense shall be Tenant's property until the
termination of this Lease. All of the foregoing items installed at Tenant's
expense as well as all paneling, partitions and business and trade fixtures and
communication and office equipment which are installed in the Demised Premises
by Tenant, and all furniture, furnishing and other articles of movable personal
property owned by Tenant and located in the Demised Premises or the Building
(all of which are hereinafter referred to as "Tenant's Property") shall belong
to Tenant, may be removed by Tenant at any time during the term hereof, and may
be removed by Tenant at the end of the term hereof or within fifteen (15) days
thereafter, whether as a result of the normal expiration of the term of this
Lease or of the early termination of this Lease pursuant to the terms hereof
(as a result of Tenant's default hereunder or otherwise). Tenant shall repair
any damage resulting from the removal of Tenant's Property and leave the Demised
Premises in a commercially reasonable condition. Any items of
41
67
[illegible text]
pursuant to Paragraph 8 hereof, be deemed abandoned and retained by Landlord as
its property thereafter.
Landlord waives any landlord or other lien it may have on Tenant's
Property and shall not seek to enforce same, whether upon Tenant's default or
otherwise.
42
68
IN WITNESS WHEREOF, Landlord and Tenant have duly executed its Lease as of the
day and year first above written.
LANDLORD:
SUNNYVALE PARTNERS LIMITED
PARTNERSHIP, an Illinois limited partnership
By: Ridge Sunnyvale, Inc.
Its: General Partner
By: /s/ XXXXX X. XXXXXXX
-----------------------------
Its: President
-----------------------------
TENANT:
FIRST DATA MERCHANT SERVICES
CORPORATION, a Florida corporation
By: /s/ XXXXX XXXXXXXXXX
----------------------------------
Its: Assistant Secretary
---------------------------------
43
69
EXHIBIT A
LEGAL DESCRIPTION
Real Property in the City of Sunnyvale, County of Santa Xxxxx, State of
California described as follows:
Beginning at the Southeasterly corner of that certain 5.58 acre parcel of land
described in the Deed to Xxxxxxxx Chemical Company, a California Corporation
as said Deed is filed for record in Book 1331 Official Records, Page 256 in the
Office of the Recorder of said County said Point of Beginning being in the
centerline of Fremont Avenue;
Thence from said Point of Beginning, South 89 degrees 48' West along said
centerline of Fremont Avenue 409.86 feet to the Easterly line of the land
described in the Deed to said Xxxxxxxx Chemical Company, filed for record in
Book 2891 Official Records, Page 325 in the Office of the Recorder of Said
County;
Thence continuing South 89 degrees 48' West along said centerline 143.22 feet to
the centerline of Stevens Creek as shown on the Map of the X.X. Xxxxxx
Subdivision No. 2 filed for record October 3, 1904 in Vol. "F-3" of Maps, Page
99 in the Office of the Recorder of said County last said point being also the
Southwesterly corner of Lot 24 of said subdivision;
Thence leaving Fremont Avenue and running along the centerline of Stevens Creek
and the Westerly boundary of Lot 24 as shown on said Subdivision Map the
following courses;
North 50 degrees West 46.20 feet; thence North 15 degrees 45' West (North 16
degrees 45' Xxxx Xxxxxx Sub.) 118.80 feet; thence North 1 degree East 135.30
feet; thence North 37 degrees 30' East 264.00 feet; thence North 74 degrees
East 178.20 feet; thence North 35 degrees 15' East 126.72 feet; thence North 23
degrees 30' East 96.66 feet; thence North 61 degrees 45' East to the point of
intersection of said centerline of Stevens Creek with the Northerly
prolongation of the Easterly line of said 5.58 acre parcel; thence South 0
degrees 01' West leaving said boundary of Lot 24, along said prolongation and
Easterly line, 823.39 feet to the Point of Beginning.
Excepting therefrom the lands described in the Deed from said Xxxxxxxx Chemical
Company to the State of California recorded in Book 5541 Official Records, Page
263 in the Office of the Recorder of said County;
Commencing at the Southeasterly corner of that certain 5.58 acre parcel of land
conveyed to Xxxxxxxx Chemical Company, a Corporation, by Deed recorded February
16, 1946 in Book 1331 at Page 256, official Records of Santa Xxxxx County;
Thence along the Easterly line of said parcel and the Northerly prolongation
thereof North 1 degree 00' 41" East 823.39 feet to the general Westerly line
of the parcel of land conveyed to Xxxxxxxx Chemical Company, a Corporation, by
Deed recorded June 10, 1954 in Book 2891 at Page 325, Official Records of Santa
Xxxxx County; thence along last said line South 62 degrees 40' 37" West, 197.03
feet to a line parallel with and distant 48.00 feet Westerly, at right angles,
from
70
The ME line of the Department or Public Works Survey for the State Freeway in
Santa Xxxxx County, Road IV-SC1-114-A; thence along said parallel line South 16
degrees 01' 13" East, 479.62 feet; thence, South 9 degrees 06' 48" East, 167.07
feet; thence along a tangent curve to the right with a radius of 40.00 feet,
through an angle of 99 degrees 50' 37", an arc length of 69.70 feet to a line
parallel with and distant 60.00 feet, Northerly, at right angles, from the
centerline of Fremont Avenue (60.00 feet wide); thence along last said parallel
line, North 89 degrees 16' 11" West, 115.00 feet; thence South 76 degrees 50'
32" West, 124.99 feet; thence South 0 degrees 43' 49" West 30.00 feet to said
centerline; thence along last said line South 89 degrees 16' 11" East 278.80
feet to the point of commencement.
2
71
EXHIBIT B
THE PREMISES
18
