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EXHIBIT 10.9
SUBLEASE
THIS SUBLEASE (this "Sublease") is dated for reference purposes
as of October 1, 1999, and is made by and between Micron Technology, Inc., a
Delaware corporation ("Sublessor"), and Visual Networks, Inc., a Delaware
corporation ("Sublessee"). Sublessor and Sublessee agree as follows:
1. Recitals. Metropolitan Life Insurance Company, as Landlord
("Master Lessor"), and Mitsubishi Electronics America, Inc. ("Master
Sublessor") entered into that certain Office Lease dated as of December 19,
1997 ("Master Lease"), with respect to that certain 32,256 square feet of
space ("Premises") located in that approximately 79,776 square foot building
("Building") commonly known as 000 Xxxx Xxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxxxx. Master Sublessor also entered into a sublease with Rendition,
Inc. ("Rendition") dated December 19, 1997 ("Underlease"). Sublessor acquired
the stock of Rendition in October of 1998 and thereby assumed Rendition's
obligations and liabilities under the Underlease. A copy of the Master Lease
is attached hereto as Exhibit A. A copy of the Underlease is attached hereto
as Exhibit B. Capitalized terms used and not otherwise defined herein shall
have the meaning ascribed to them in the Master Lease. Sublessor desires to
lease to Sublessee and Sublessee desires to lease from Sublessor the Premises
which are depicted on Exhibit A to the Master Lease.
2. Premises. Subject to the terms and conditions set forth
herein, Sublessor subleases to Sublessee, and Sublessee subleases from
Sublessor, the Premises.
3. Term/Early Occupancy. Subject to Paragraph 16, the term
("Term") of this Sublease shall commence on the later of (a) thirty (30) days
following the date Sublessor vacates the Premises; or (b) December 1, 1999
("Commencement Date"), unless otherwise agreed to in writing by the parties.
This Sublease shall terminate on the earliest to occur of (a) July 31, 2003
(the "Expiration Date") or (b) the date this Sublease is sooner terminated
pursuant to its terms . Sublessor agrees to cooperate with Sublessee to allow
Sublessee access to the Premises, if possible, prior to the Commencement Date
("Early Occupancy Period") to allow Sublessee to install improvements in the
Premises. During such Early Occupancy Period, Sublessee shall be subject to
all of the terms and conditions of this Sublease excluding the payment of any
Base Rent or Operating Expenses.
4. Delivery and Acceptance. If Sublessor is unable to deliver
possession of the Premises to Sublessee on or before February 28, 2000, for any
reason whatsoever, then, as Sublessee's sole and exclusive remedy, Sublessee may
terminate this Sublease by written notice to Sublessor given on or before March
10, 2000, whereupon any monies previously paid by Sublessee to Sublessor shall
be reimbursed to Sublessee and the parties shall have no further obligation to
each other. Except as expressly set forth otherwise herein, by taking possession
of the Premises, Sublessee conclusively shall be deemed to have accepted the
Premises in their "as-is", then-existing condition, without any warranty
whatsoever of Sublessor with respect thereto.
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5. Rent.
A. Base Rent. During the Term, Sublessee shall pay to
Sublessor as base monthly rent ("Base Rent") the following amounts:
Months Base Rent
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Prior to 11/30/99 $60,673.54
12/l/99-11/30/00 $63,403.85
12/l/00-11/30/01 $66,257.02
12/l/01-11/30/02 $69,238.58
12/l/02-7/31/03 $72,354.32
Base Rent and any Rent Adjustment Deposit (as defined below) of
which Sublessee has at least ten (10) days' prior written notice shall be
paid to Sublessor on or before the first (1st) day of each month during the
Term. Base Rent and Additional Rent (as defined below) (collectively,
"Rent") for any period during the Term hereof which is for less than one
month of the Term shall be a pro rata portion of the monthly installment
based on a calendar month. Base Rent and any Rent Adjustment Deposit of which
Sublessee has at least ten (10) days' prior written notice shall be payable
without notice or demand, and Rent shall be paid without, any deduction,
offset, or abatement, in each case in lawful money of the United States of
America. Rent shall be paid directly to Sublessor at Micron Technology, Inc.,
0000 Xxxxx Xxxxxxx Xxx, Xxxxx, Xxxxx 00000 - Attention: Real Estate Manager,
or such other address as may be designated in writing by Sublessor.
Notwithstanding the foregoing, upon execution of this Sublease by Sublessee,
Sublessee shall pay to Sublessor the sum of Sixty-Three Thousand Four Hundred
and Three Dollars and 85/00 ($63,403.85) as prepayment of rent for credit
against the first installment of Base Rent due hereunder and any resulting
excess shall be applied to the second installment of Base Rent due hereunder.
B. Additional Rent. Sublessee shall pay to Sublessor
within ten (10) days of written demand by Sublessor to Sublessee (which
written demand shall include any landlord statement or invoice required or
provided for under the Master Lease), all expenses under the Master Lease
that are applicable to the Premises and required to be paid by Sublessor to
Master Lessor, or otherwise required to be paid by Sublessor under the Master
Lease, including, without limitation, all (i) Rent Adjustments, Rent
Adjustment Deposits, utility charges and insurance premiums, (ii) all taxes
and assessments payable by Sublessor pursuant to Article Four of the Master
Lease, and (iii) Sublessor's share of Master Lessor's property insurance
premiums payable pursuant to the Master Lease ("Additional Rent").
6. Security Deposit. Upon execution of this Sublease by
Sublessee, Sublessee shall deposit with Sublessor the sum of Seventy-Two
Thousand Three Hundred and Fifty-Four Dollars and 32/00 ($72,354.32), in
cash, as security for the performance by Sublessee of the terms and
conditions of this Sublease. If Sublessee fails to pay Rent or other charges
due in accordance with the terms of this Sublease or otherwise defaults with
respect to any provision of this Sublease, then Sublessor may draw upon, use,
apply or retain all or any portion of the
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Security Deposit for the payment of any Rent or other charge in default, for the
payment of any other sum which Sublessor has become obligated to pay by reason
of Sublessee's default, or to compensate Sublessor for any loss or damage which
Sublessor has suffered thereby. If Sublessor so uses or applies all or any
portion of the Security Deposit, then Sublessee, within ten (10) days after
written demand by Sublessor therefor, shall deposit cash with Sublessor in the
amount required to restore the Security Deposit to the full amount stated above.
Within thirty (30) days following the expiration or earlier termination of this
Sublease, if Sublessee is not in default hereunder, Sublessor shall return to
Sublessee so much of the Security Deposit as has not been applied by Sublessor
pursuant to this paragraph, or which is not otherwise required to cure
Sublessee's defaults hereunder.
7. Condition of the Premises. Sublessor shall provide the
Premises in "broom clean" condition with Sublessor's personal property and
equipment removed (except as otherwise agreed to by Sublessee) and all
operating systems in good condition. Except as set forth in the preceding
sentence, Sublessee is subleasing the Premises on an "as-is" basis, and
Sublessor has made no representations or warranties, express or implied, with
respect to the condition of the Premises as of the Commencement Date.
Sublessor shall have no obligation whatsoever to make or pay the cost of any
alterations, improvements or repairs to the Premises, including, without
limitation, any improvement or repair required to comply with any law,
regulation, building code or ordinance (including, without limitation, the
Americans with Disabilities Act of 1990). Sublessor shall have no obligation
to perform any of the repairs (or capital improvements) required by Master
Lessor under the terms of the Master Lease.
8. Effect of Conveyance. Sublessor shall not assign or
transfer its interest under the Under Lease without all required consents of
the Master Lessor and the Master Sublessor. In the event of any permitted
assignment or transfer of such interest, as between Sublessor and Sublessee,
Sublessor shall be and hereby is entirely relieved of all covenants and
obligations of Sublessor hereunder, provided that the assignee or transferee
agrees in writing for the benefit of Sublessee to assume and carry out all
covenants and obligations of Sublessor hereunder, whether arising before or
after such assignment or transfer. Sublessor shall transfer and deliver any
security of Sublessee to the assignee or transferee, and thereupon Sublessor
shall be discharged from any further liability with respect thereto.
9. Use. Sublessee shall use the Premises for office, research
and development and any other uses permitted under the Master Lease.
10. Surrender. Prior to expiration or earlier termination of
this Sublease, Sublessee shall remove all trade fixtures, personal property
and alterations to the Premises made by Sublessee that Sublessee is required
to remove or has the right to remove pursuant to the terms of the Master
Lease, and shall surrender the Premises to Sublessor in good condition, free
of Hazardous Materials caused by Sublessee, reasonable wear and tear,
casualties and condemnation, excepted. If the Premises are not so
surrendered, then Sublessee shall be liable to Sublessor for all costs
incurred by Sublessor (including any charges by Master Lessor under the
Master Lease) in returning the Premises to such required condition.
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11. Holdover. If Sublessee remains in possession of the
Premises after the expiration or earlier termination of this Sublease,
Sublessee's continued possession shall be as a sublessee at sufferance of
Sublessor and Sublessee shall continue to comply with and perform all the
terms and obligations of the Sublessee under this Sublease and pay Sublessor
holdover Base Rent equal to one hundred fifty percent (150%) of the Base Rent
payable immediately preceding the termination of this Sublease. Sublessee
shall indemnify, protect, defend and hold harmless Sublessor, its officers,
directors, employees, agents and assigns, from and against loss and liability
resulting from Sublessee's delay in surrendering the Premises.
12. Other Sublease Terms.
A. Incorporation By Reference. Except as otherwise
provided in or modified by this Sublease, the terms, and conditions contained
in the Master Lease are incorporated herein by reference, and are made a part
hereof as if set forth herein at length; provided, however, that: (i) each
reference in such incorporated sections to "Lease" shall be deemed a
reference to "Sublease"; (ii) each reference to the "Premises" shall be
deemed a reference to the "Premises" as defined herein; (iii) each reference
to "Landlord" and "Tenant" shall be deemed a reference to "Sublessor" and
"Sublessee", respectively; (iv) Sublessor shall have no liability to
Sublessee with respect to (a) representations and warranties made by Master
Lessor under the Master Lease and (b) subject to Sublessor's obligations
under Section 12.E. and F. hereof, Master Lessor's repair, maintenance,
restoration, upkeep, insurance and similar obligations under the Master
Lease, regardless of whether the incorporation of one or more provisions of
the Master Lease into the Sublease might otherwise operate to make Sublessor
liable therefor; (v) with respect to any obligation of Sublessee to be
performed under this Sublease, wherever the Master Lease grants to Sublessor
a specified number of days to perform its corresponding obligations under the
Master Lease (excluding the payment of Monthly Base Rent or any other sum for
which notice from Sublessor to Sublessee is required hereunder), Sublessee
shall have two (2) fewer days to perform the obligation, including without
limitation, curing any defaults (which cure period shall automatically
commence to run against Sublessee at the same time it commences to run
against Sublessor provided that Sublessor immediately provides Sublessee with
a copy of Master Lessor's or Master Sublessor's notice of default, if Master
Lessor or Master Sublessor has not already done so); (vi) with respect to any
approval or consent required to be obtained from the "Landlord" under the
Master Lease, such approval or consent must be obtained from Master Lessor,
Master Sublessor and Sublessor, and the approval or consent of Sublessor may
be withheld if Master Lessor's approval or consent is not obtained; and (vii)
the following provisions of the Master Lease are expressly NOT incorporated
herein by reference: Section 1.01(2), (3), (4), (5), (6), (7), (11), (14);
Section 1.03(7) and (23), Section 2.02, Section 2.03, Section 2.05, Article
21, Article 22, Article 24, Exhibit B, Rider 1 and Rider 4.
B. Incorporation of Underlease. This Sublease shall
include all of the provisions of the Underlease, which are incorporated into
this Sublease as if fully set forth herein, except as modified in this
paragraph and except that: (i) each reference in such incorporated sections
to "Sublease" shall be deemed a reference to this Sublease; and (ii) each
reference to "Sublessor" in the Underlease shall be deemed a referenced to
Sublessor hereunder and each reference to "Sublessee" in the Underlease shall
be deemed a reference to "Sublessee," hereunder, except as otherwise
expressly set forth herein. Notwithstanding the foregoing, the
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following provisions of the Underlease are expressly NOT incorporated herein by
reference: paragraphs 1, 2, 3, 4, 5, 6, 7.1, 7.2, 7.3 (except as may be modified
by this Sublease), 8, 9 and 10.
C. Assumption of Obligations. This Sublease is and at
all times shall be subject and subordinate to the Master Lease and the rights
of Master Lessor thereunder. Sublessor shall not commit or permit any of its
employees or agents to commit on the Premises any act or omission which shall
violate any term or condition of the Master Lease. Sublessee hereby expressly
assumes and agrees: (i) to comply with all provisions of the Master Lease
which are required to be performed by Sublessee hereunder; and (ii) to
perform all the obligations on the part of the "Tenant" to be performed under
the terms of the Master Lease during the term of this Sublease which are
required to be performed by Sublessee hereunder. Sublessee shall not commit
or permit to be committed on the Premises any act or omission which shall
violate any term or condition of the Master Lease.
D. Rights and Benefits Under Master Lease and
Underlease. Sublessee shall have all the rights, privileges and benefits
granted to or conferred upon Sublessor under the Master Lease and the
Underlease, provided that Sublessee's exercise of such rights, privileges and
benefits shall not cause Sublessor to be in default.
E. Enforcement by Sublessee. If Master Lessor shall
fail or refuse to comply with any of the terms of the Master Lease, or Master
Sublessor shall fail or refuse to comply with any of the terms of the
Underlease, Sublessee shall have the right, upon notice to Sublessor, to
exercise, in its own name, and that of Sublessor, all the rights available to
Sublessor under the Master Lease and the Underlease to enforce performance on
the part of Master Lessor and Master Sublessor, provided, however, that
Sublessee shall defend, indemnify and hold harmless Sublessor from and
against any costs and expenses arising out of or incurred in connection with
Sublessee's exercise of such rights.
F. Enforcement by Sublessor. If, notwithstanding the
provisions of Paragraph 12.E. above, Sublessee shall reasonably require the
participation of Sublessor in enforcing the obligations of Master Lessor
under the Master Lease, or Master Sublessor under the Underlease, then,
Sublessor, upon Sublessee's written request, shall endeavor diligently to
enforce such obligations (including the commencement of appropriate legal
proceedings) to attempt to cause Master Lessor or Master Sublessor to provide
Sublessee with the service or other benefit in question. Sublessee shall
reimburse all reasonable costs and expenses Sublessor shall incur in
enforcing or attempting to enforce the Master Lease against Master Lessor,
and the Underlease against Master Sublessor.
G. Preservation of Master Lease and Underlease. So long
as Sublessee complies with its obligations under this Sublease: (a)
Sublessor shall preserve the Underlease and keep the Underlease in full force
and effect throughout the Term and shall not, by voluntary agreement,
terminate the Underlease; (b) Sublessor shall not agree to any amendment of
the Master Lease or the Underlease in a manner that would have an adverse
impact on the rights or obligations of Sublessee under this Sublease without
the consent of Sublessee (which consent, in the event that the amendment
would have an adverse impact on the rights or obligations of Sublessee, may
be granted or denied at the sole discretion of Sublessee); (c) Sublessor
shall not, without Sublessee's written consent, exercise any right to
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terminate the Underlease (including any right to treat the Underlease as
terminated pursuant to any bankruptcy or insolvency proceeding effecting
Master Sublessor) with respect to any period within the Sublease Term, other
than on account of casualty or condemnation (provided that Sublessee shall
defend, protect, hold harmless and indemnify Sublessor from and against any
additional costs and expenses that are incurred by Sublessor as a result of
Sublessor's waiver of its right to terminate the Underlease as provided
herein) and (d) Sublessor shall make prompt payment to the Master Lessor or
the Master Sublessor, as appropriate, of all sums paid by Sublessee to
Sublessor hereunder.
H. Notices to or from Master Lessor or Master
Sublessor. Each party shall provide to the other with a copy of any notice
or other written communication of any kind given to or received from Master
Lessor or Master Sublessor, within one (1) business day following the
delivery or receipt of such notice or written communication.
I. Encumbrance of Sublessor's Leasehold Estate.
Notwithstanding anything to the contrary in the Master Lease or the
Underlease, Sublessor shall not have the right to encumber its leasehold
estate during the Term.
13. Broker. Sublessor and Sublessee each represent to the
other that they have not dealt with any real estate brokers, finders, agents
or salesmen in connection with this transaction except Colliers
International, Inc. ("Colliers") representing Sublessor and Xxxxx Xxxxxx
Associates representing Sublessee (collectively "Brokers"). Each party agrees
to hold the other party harmless from and against all claims for brokerage
commissions, finder's fees or other compensation made by any other agent,
broker, salesman or finder as a consequence of said party's actions or
dealings with such agent, broker, salesman, or finder. Broker's fees shall be
paid by Sublessor pursuant to a separate agreement between Sublessor and
Colliers.
14. Notices. The address of each party shall be that address
set forth below their signatures at the end of this Sublease. Any party
hereto may change its address for the purposes of this Paragraph 14 by
delivery of at least five (5) days prior written notice of such change to
each other party in the manner set forth in this Paragraph. All notices,
demands or communications in connection with this Sublease shall be (i) in
writing, (ii) properly addressed, and (iii) either (a) served personally, (b)
sent by prepaid, certified mail, return receipt requested, (c) sent by
recognized overnight courier service, or (d) sent by facsimile, if to
Sublessor to "Real Estate Manager" and to "General Counsel" at the address
and fax numbers set forth below and if to Sublessee to "Property Manager" at
the address and fax numbers set forth below. Notices served personally shall
be deemed received on the date of delivery. Notices mailed in accordance
herewith shall be deemed received on the date the U.S. Post Office receipts
delivery or refusal to accept delivery. Notices delivered by recognized
courier service shall be deemed received on the next business day following
deposit with the courier- service. Notices sent by facsimile shall be deemed
received upon electronic confirmation of receipt of transmission. If a notice
is received or deemed received on a Saturday, Sunday or legal holiday, it
shall be deemed received on the next business day. All notices given to
Master Lessor under the Master Lease shall be considered received only when
delivered in accordance with the Master Lease.
15. Hazardous Materials. Sublessee shall use no Hazardous
Materials (other than those listed on the attached Exhibit B hereto) in, on,
under or about the Premises or the
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Building, except for normal types and quantities of Hazardous Materials
typically used in connection with the use of real property for general office
and administrative purposes, which Sublessee may use, in compliance with all
applicable laws and regulations, on the Premises.
16. Conditions Precedent. Notwithstanding anything to the
contrary set forth in this Sublease, it shall be an express condition
precedent to Sublessor's obligations hereunder that, and this Sublease shall
not be effective unless and until: (i) Master Lessor has consented in
writing to this Sublease; and (ii) Master Sublessor has provided its consent
in writing to this Sublease and such consent contains substantially the same
convenants from Master Sublessor with respect to the Master Lease that
Sublessor has made with respect to the Underlease in Paragraph 12.G. hereof.
If either Master Lessor or Master Sublessor do not consent in writing to this
Sublease within thirty (30) days after Sublessor's execution of this
Sublease, then Sublessor or Sublessee may, at any time thereafter until such
approval is obtained, terminate this Sublease upon written notice to the
other party, whereupon any monies previously paid by Sublessee to Sublessor
shall be reimbursed to Sublessee.
17. Assignment and Subletting. Sublessee shall not assign this
Sublease or sublet all or any part of the Premises without both the prior
written consent of Sublessor, the Master Sublessor and the Master Lessor,
under the terms and conditions of the Master Lease. Any transfer circumstance
or event which constitutes an assignment or subletting under the Master Lease
shall constitute an assignment or subletting under this Sublease.
18. Parking. Sublessee shall be entitled to all the parking
spaces available to the 999 E. Arques address, as specified in the Master
Lease.
19. Sublessee's Indemnity. Sublessee shall indemnify, defend,
protect, and hold Sublessor and its officers, agents and employees
(collectively, "Sublessor's Agents") harmless from and against all claims,
demands, actions, causes of action, losses and expenses (collectively
"Claims") which may be brought against Sublessor or Sublessor's Agents or
which Sublessor or Sublessor's Agents may pay or incur by reason of any
breach or default of this Sublease by Sublessee, or the acts, omissions,
negligence or willful misconduct of Sublessee or Sublessee's employees,
agents, contractors, or invitees in or about the Premises during the Term to
the extent that the Claims are not caused by the negligence or willful
misconduct of Sublessor or Sublessor's Agents. Without limiting the
generality of the foregoing, Sublessee shall indemnify, defend, protect and
hold Sublessor and Sublessor's Agents harmless from and against any Claims
which may be brought against Sublessor or Sublessor's Agents or which
Sublessor or Sublessor's Agents may pay or incur by reason of any violation
of any laws by Sublessee or its employees, agents or contractors during the
term of the Sublease.
20. Successors. This Sublease shall be binding on and inure to
the benefit of the parties hereto and their respective successors and
permitted assigns.
21. Counterparts. This Sublease may be executed in one or more
counterparts each of which shall be deemed an original but all of which
together shall constitute one and the same instrument. Signature copies may
be detached from the counterparts and attached to a single copy of this
Sublease physically to form one document. A facsimile counterpart signature
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delivered to each party shall be deemed an original for the purpose of the
execution of this Sublease.
22. No Conflict. In the event of any conflict between the
terms of this Sublease and the terms of the Master Lease, as between
Sublessor and Sublessee, the terms of this Sublease shall prevail.
23. Quiet Enjoyment. So long as Sublessee pays the rent and
performs its obligations under this Sublease (including the Master Lease or
Under Lease as incorporated by reference), Sublessor shall take no action, or
fail to take any action, which would interfere with the right of Sublessee to
peaceably have, hold and enjoy the Premises during the Term, subject to the
terms of the Master Lease or Under Lease and this Sublease.
24. Indemnity. Sublessor and Sublessee shall each indemnify
and hold the other harmless from and against any and all loss, liability or
expense, including reasonable attorneys' fees, incurred or suffered by the
other party on account of the indemnifying party's failure to perform its
obligations, or because of a material breach by the indemnifying party under
this Sublease (including the Master Lease or Under Lease as incorporated by
reference) or the indemnifying party's intentionally wrongful acts.
25. Entire Agreement. This Sublease and the provisions of the
Master Lease and the Under Lease incorporated herein by the express terms of
this Sublease constitute the complete and exclusive agreement among the
parties with respect to the matters contained herein and supersede all prior
written or oral agreements or statements by and among the parties hereto,
provided that this Sublease shall be at all times subject to all of the terms
and conditions of the Master Lease and the Under Lease.
IN WITNESS WHEREOF, the parties have executed this Sublease as of
the day and year first above written.
SUBLESSEE: SUBLESSOR:
VISUAL NETWORKS, INC. MICRON TECHNOLOGY, INC.
a Delaware corporation a Delaware corporation
By: /s/ XXXXX X. XXXXXXXX By: /s/ XXXXXX XXXXX
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Printed Name: Xxxxx X. Xxxxxxxx Printed Name: Xxxxxx Xxxxx
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Its: Executive Vice President, Its: Vice President of
CFO and Treasurer Facilities
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Date: October 29, 1999 Date: December 9, 1999
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Address: 0000 Xxxxxxx Xxxx Address: 0000 Xxxxx Xxxxxxx Xxx
Xxxxxxxxx, Xxxxxxxx 00000 Xxxxx, Xxxxx 00000
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Facsimile: (000) 000-0000 (000) 000-0000
(note if different facsimile for different notice recipients)
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EXHIBIT A
MASTER LEASE
(To be inserted)
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EXHIBIT B
UNDERLEASE
(To be inserted)
12
EXHIBIT C
HAZARDOUS MATERIALS USAGE
Name Volume Stored on Premises Amount Used on a Monthly Basis
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