Page 1. PREMISES 1 2. TERM 2 3. OPTION TO EXTEND THE TERM 4 4. BASIC RENT 7 5. ADDITIONAL RENT 8 6. TENANT’S RIGHT TO INSPECT RECORDS 14 7. USE OF THE PREMISES 15 8. IMPROVEMENT AND ACCEPTANCE OF PREMISES 15 9. SERVICES 16 10. MAINTENANCE AND REPAIRS...
Exhibit 10.101
LEASE
BETWEEN
SAN XXXXXX LAND COMPANY, LLC,
AS LANDLORD,
AND
MANAGED HEALTH NETWORK, INC.,
AS TENANT
February 6, 2008
TABLE OF CONTENTS
Page | ||||
1. |
PREMISES | 1 | ||
2. |
TERM | 2 | ||
3. |
OPTION TO EXTEND THE TERM | 4 | ||
4. |
BASIC RENT | 7 | ||
5. |
ADDITIONAL RENT | 8 | ||
6. |
TENANT’S RIGHT TO INSPECT RECORDS | 14 | ||
7. |
USE OF THE PREMISES | 15 | ||
8. |
IMPROVEMENT AND ACCEPTANCE OF PREMISES | 15 | ||
9. |
SERVICES | 16 | ||
10. |
MAINTENANCE AND REPAIRS | 18 | ||
11. |
ALTERATIONS | 21 | ||
12. |
COMPLIANCE WITH LAWS AND INSURANCE STANDARDS | 22 | ||
13. |
LIENS AND INSOLVENCY | 23 | ||
14. |
PARKING | 23 | ||
15. |
SIGNS AND ADVERTISING | 25 | ||
16. |
ASSIGNMENT OR SUBLETTING | 25 | ||
17. |
TENANT’S PROPERTY | 29 | ||
18. |
ENTRY BY LANDLORD | 30 | ||
19. |
TENANT’S INSURANCE | 31 | ||
20. |
WAIVER OF SUBROGATION | 33 | ||
21. |
DAMAGE AND DESTRUCTION | 34 | ||
22. |
CONDEMNATION | 35 | ||
23. |
DAMAGE TO TENANT’S PROPERTY AND EXCULPATION | 36 | ||
24. |
INDEMNIFICATION | 37 |
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TABLE OF CONTENTS
Page | ||||
25. |
HAZARDOUS MATERIALS | 38 | ||
26. |
SUBORDINATION | 40 | ||
27. |
ESTOPPEL CERTIFICATE | 42 | ||
28. |
RULES AND REGULATIONS | 42 | ||
29. |
SECURITY DEPOSIT | 43 | ||
30. |
DEFAULTS AND REMEDIES | 44 | ||
31. |
LATE CHARGE | 46 | ||
32. |
TIME | 46 | ||
33. |
QUIET ENJOYMENT | 46 | ||
34. |
TRANSFER OF LANDLORD’S XXXXXXXX | 00 | ||
00. |
RIGHT TO PERFORM | 47 | ||
36. |
NOTICES | 47 | ||
37. |
WAIVER OF RIGHT TO JURY TRIAL | 48 | ||
38. |
ATTORNEYS’ FEES | 48 | ||
39. |
SURRENDER OF PREMISES | 49 | ||
40. |
HOLDING OVER | 50 | ||
41. |
NON-WAIVER | 50 | ||
42. |
MORTGAGEE PROTECTION | 50 | ||
43. |
FINANCIAL STATEMENTS | 50 | ||
44. |
CHANGES TO THE PROJECT | 50 | ||
45. |
RIGHT OF FIRST OFFER | 51 | ||
46. |
GENERAL PROVISIONS | 52 |
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SAN XXXXXX LAND COMPANY
BASIC LEASE INFORMATION
Date: | February 6, 2008 | |
Landlord: | San Xxxxxx Land Company, LLC | |
Tenant: | Managed Health Network, Inc. | |
Project: | The property, together with the two office buildings and other improvements being constructed thereon, known as 2350 and 0000 Xxxxxx Xxxx, Xxx Xxxxxx, Xxxxxxxxxx | |
Building: | The southerly of the two office buildings being constructed by Landlord on the Project, known as “Building One” and having an address of 0000 Xxxxxx Xxxx, Xxx Xxxxxx, Xxxxxxxxxx | |
Premises: | Approximately Sixty-Two Thousand Six Hundred Forty-Seven (62,647) square feet of Rentable Area on the Second (2nd) and Third (3rd) Floors of the Building as more particularly identified on Exhibit A attached hereto, consisting of the North Wing (which contains Twenty-Three Thousand Forty-One (23,041) square feet of Rentable Area), Second Floor South Wing (which contains Nineteen Thousand Four Hundred Eighty (19,480) square feet of Rentable Area) and Third Floor South Wing (which contains Twenty Thousand One Hundred Twenty-Six (20,126) square feet of Rentable Area), all subject to measurement and adjustment as described in Section 1(c); | |
Initial Term: | Seven (7) years, commencing as of the first to occur of the North Wing Commencement Date, Second Floor South Wing Commencement Date or Third Floor South Wing Commencement Date and continuing to and including the Term Expiration Date, subject to Sections 2(e) and 3 | |
Basic Rent: | See Section 4(a) | |
Commencement Date: | (i) With respect to the North Wing, the date the North Wing is Substantially Complete (the “North Wing Commencement Date”), which the parties estimate will be on or before May 14, 2008; (ii) with respect to the Second Floor South Wing, the date the Second Floor South Wing is Substantially Complete (the “Second Floor South Wing Commencement Date”), which the parties estimate will be on or before June 12, 2008; and (iii) with respect to the Third Floor South Wing, the date the Third Floor South Wing is Substantially Complete (the “Third Floor South Wing Commencement Date”), which the parties estimate will be on or before June 25, 2008; each of the foregoing estimated dates of commencement being, with respect to the applicable portion of the Premises hereinabove identified, sometimes referred to in this Lease as the “Projected Commencement Date” |
Term Expiration Date: | The day immediately preceding the seventh (7th ) anniversary of the last to occur of the North Wing Commencement Date, Second Floor South Wing Commencement Date or Third Floor South Wing Commencement Date | |
Security Deposit: | Waived | |
Base Year: | 2008; provided, however, that with respect to Property Taxes, the Base Year shall be the 2008/2009 tax year | |
Tenant’s Proportionate Share: |
The ratio which the Rentable Area of the Premises bears to the Rentable Area of the Project | |
Tenant Improvements: | See Section 8 and Exhibits B, C and D | |
Tenant Improvement Allowance: | An amount equal to Fifty Dollars ($50.00) per square foot of Rentable Area contained in the Premises, subject to adjustment as described in Section 1(c) | |
Tenant’s Broker: | Madison Partners |
OFFICE LEASE
THIS LEASE is entered into by and between Landlord and Tenant, as specified in the Basic Lease Information, which is incorporated herein by reference, as of the date shown in the Basic Lease Information.
(c) Verification of Rentable Area of Premises, Building and Project.
(i) For the purposes of this Lease:
(A) “Rentable Area” of the Premises shall be the product of: (x) the “usable area” of the Premises, as calculated pursuant to the Standard Method for Measuring Floor Area in Office Buildings, [ANSI Z65.1 – 1996] (“BOMA Standard”); multiplied by (y) one hundred twelve percent (112%) (or one hundred fifteen percent (115%) with respect to the Third (3rd) Floor of the Building containing the premises.
(B) “Rentable Area” of the Project shall be the product of: (x) the aggregate “usable area” of the Project, as designed and as calculated pursuant to the BOMA Standard; multiplied by (y) one hundred twelve percent (112%) (or one hundred fifteen percent (115%) with respect to the Third (3rd) Floor of the Building).
(C) “Building” means the southerly of the two office buildings on the Project, known as “Building One” and having an address of 0000 Xxxxxx Xxxx, Xxx Xxxxxx, Xxxxxxxxxx. As of the date of this Lease, the construction of the Building (including the “shell” elements set forth in Exhibit H) is substantially complete.
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(D) “Buildings” means, collectively, the Building and the other building on the Project.
(E) “Project” means the land, together with the Buildings and other improvements now or in the future constructed thereon, known as 2350 and 0000 Xxxxxx Xxxx, Xxx Xxxxxx, Xxxxxxxxxx.
(ii) The Rentable Area of the Premises, the Building and the Project shall be determined by Landlord’s architect. Upon the completion of such determination, Landlord shall notify Tenant of the correct Rentable Areas of each of them, and, if the Premises are determined to contain more or less than Sixty-Two Thousand Six Hundred Forty-Seven (62,647) square feet of Rentable Area, Landlord and Tenant shall promptly thereafter execute an amendment to this Lease proportionately adjusting all amounts and percentages appearing or referred to in this Lease based upon Rentable Area (including, without limitation, the amounts of Basic Rent and Tenant’s Proportionate Share of Operating Expenses); provided, however, that in no event will such measurement result in an increase to Tenant in Basic Rent or Tenant’s Proportionate Share of Operating Expenses of more than five percent (5%).
(iii) In the event that Tenant elects to cause its architect also to measure the Rentable Area of the Premises, it shall do so from the Building Plans within thirty (30) days of the receipt by Tenant of such Building Plans from Landlord, and if the results of such measurement vary by more than two percent (2%) from the amount determined by Landlord’s architect, Tenant shall so notify Landlord. Landlord shall then select another architect, who shall be subject to the reasonable approval of Tenant, and Landlord and Tenant shall together request that such other architect determine the Rentable Area of the Buildings and the Premises from the plans, which determination shall be binding on Landlord and Tenant. The costs of such determination shall be paid by Landlord and Tenant in equal shares.
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telecommunications installations, data cabling, furniture and special fixtures in such premises in connection with the commencement of its business operations therein. Upon such entry, Tenant shall perform all of the obligations of Tenant applicable under this Lease during the Term (except the obligation to pay Basic Rent, Tenant’s Proportionate Share of Operating Expenses, the costs of parking at the Project, the cost of using the Building freight elevator and loading docks, or the cost of utilities or temporary heating, ventilating and air conditioning provided by Landlord to such portions of the Premises during such early access or entry period), including, without limitation, obligations pertaining to insurance, indemnity, compliance with laws and Hazardous Materials. Subject to the provisions of Sections 23 and 24, Tenant acknowledges and agrees that Landlord shall not be liable to Tenant or any Tenant Party (as that term is defined in Section 25(c)) for any injury, loss or damage to person or property which may occur in connection with such entry, the same being at Tenant’s or any such Tenant Party’s sole risk and liability.
(d) Building Riser and Minimum Point of Entry Access. Tenant shall have reasonable, non-exclusive access twenty-four (24) hours per day, seven (7) days per week (subject to (i) all reasonable security measures as may be imposed by Landlord from time to time and as are generally applicable to tenants of the Building and their invitees and (ii) restrictions on access imposed or recommended as a result of an emergency) to the Building’s riser and minimum point of entry (“MPOE”), at no charge (except as otherwise specifically provided in this Lease), for the purpose of installing, operating, repairing, maintaining and replacing Tenant’s telecommunications, data and security cabling used in connection with Tenant’s business operations in the Premises, subject to such reasonable rules, procedures and security measures (including, without limitation, the presence of and supervision by Landlord’s riser manager, if any) as Landlord may adopt, and subject to restrictions on access imposed or recommended as a result of an emergency. Tenant may utilize Tenant’s vendor or vendors (subject to Landlord’s prior approval, which shall not be unreasonably withheld, conditioned or delayed) for the purposes of installing, operating, repairing, maintaining and replacing such telecommunications and data cabling. Landlord shall reasonably cooperate with Tenant in connection with the exercise of Tenant’s rights under this Section 2(d).
(i) Tenant shall have given Landlord written notice of Tenant’s exercise of the Termination Right at least twelve (12) months prior to the Termination Date; and
(ii) No later than thirty (30) days prior to the Termination Date, Tenant shall pay to Landlord a termination payment equal to the sum of: (i) the then unamortized portion of any out-of-pocket costs actually incurred by Landlord associated with the making of this Lease (including without limitation legal, brokerage, architect and engineering fees, Landlord’s Contribution and the Offering Space Alterations Allowance (defined in Section 45(b) below), if any), as if such costs were amortized in equal monthly installments over the Term with interest at the rate of ten percent (10%) per annum; and (ii) any Basic Rent, Tenant’s Proportionate Share of Operating Expenses and additional rent past due from Tenant under the terms of this Lease; and
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(iii) At the written request of Tenant given no earlier than sixty (60) days prior to the Termination Date, Landlord shall provided Tenant with Landlord’s calculation of the termination payment required pursuant to the provisions of Section 2(e)(ii) above, and Landlord shall use its best efforts to deliver such calculation to Tenant within thirty-five (35) days prior to the Termination Date; provided, however, that: (i) any failure by Landlord to provide Tenant with such calculation shall not release Tenant from making the termination payment required pursuant to the provisions of Section 2(e)(ii) above, and (ii) Tenant may delay payment of the Termination Fee until the fifth (5th) business day following the date upon which Landlord delivers such calculation to Tenant (such payment obligation to survive the expiration or earlier termination of this Lease); and
(iv) If Tenant gives the notice of termination referred to in Section 2(e)(i) but fails to make the termination payment required by Section 2(e)(ii), then Landlord may elect by written notice to Tenant either to deem the notice of termination ineffective, in which event this Lease shall not terminate, or to allow this Lease to be terminated and to collect the termination payment described in Section 2(e)(ii) from Tenant; and
(v) If this Lease is terminated early pursuant to the provisions of this Section 2(e), Tenant shall quit and surrender possession of the Premises to Landlord on the Termination Date in the manner and condition required under the terms of this Lease.
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agrees with Landlord’s determination of Fair Market Rental Value for the Extension Term or (y) disagrees with Landlord’s determination of Fair Market Rental Value for the Extension Term and elects to resolve the disagreement as provided in Section 3(d)(i) below. If Tenant does not send to Landlord a notice as provided in the previous sentence within the said thirty (30) day period, Landlord’s determination of the Fair Market Rental Value shall be binding on Landlord and Tenant. Until the disagreement is resolved as provided in Section 3(d)(i) below, Tenant’s monthly payments of Basic Rent shall be in an amount not less than the greater of (x) Landlord’s determination of the Fair Market Rental Value and (y) the Basic Rent payable for the twelve (12) month period immediately preceding the commencement of the Extension Term. Within ten (10) business days following the resolution of such dispute by the parties or the decision of the brokers or appraisers, as applicable, one party shall make any necessary payment to the other party in order to adjust the amount previously paid by Tenant during the Extension Term to the Fair Market Rental Value as determined. Notwithstanding anything to the contrary set forth in this Section 3, in no event shall the Basic Rent for the Extension Term be less than the Basic Rent payable immediately preceding the commencement of the Extension Term (not taking into account any abatements or reductions in Basic Rent which may have been applicable during such period pursuant to the provisions of this Lease). Tenant shall in any event pay all applicable additional charges with respect to the Premises, in the manner and at the times provided in this Lease, effective upon the commencement of the Extension Term, and notwithstanding any dispute regarding the Basic Rent for the Extension Term, using the Base Year for the Extension Term as adjusted pursuant to this Section 3(b).
(d) Determination of Fair Market Rental Value. As used in this Lease, the term “Fair Market Rental Value” shall mean the product of: (i) the Rentable Area of the Premises; multiplied by (ii) the average rental rate per rentable square foot per month (taking into account additional rent and all other monetary payments and considering any base year or expense stop applicable thereto), including all escalations, for all leases for comparable, unencumbered space for approximately the same lease term executed at the Project and/or any other comparable Class A building in terms of size, quality, level of services, amenities, views,
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age and appearance located within the portion of Marin County south of the most northerly point of the city limits of San Xxxxxx, during the twelve (12) month period immediately preceding the date upon which the determination of Fair Market Rental Value is made, and having a commencement date within six (6) months of the date that the Fair Market Rental Value will commence under this Lease, and taking into account (A) any tenant improvements and other concessions (including any free and abated rent) granted to Tenant and tenants under leases of such comparable space or then existing in the Premises or the premises in the transaction, and (B) whether the transaction is an initial lease or a renewal or extension of an existing lease. Costs which are incurred by a landlord in connection with the negotiation and documentation of a lease transaction, and other costs incurred by a landlord which are not paid to or for the direct benefit of the tenant, shall not be considered.
(i) Any disagreement regarding the Fair Market Rental Value for the purposes of this Section 3 shall be resolved as follows:
(A) Within twenty (20) days after Tenant’s response to Landlord’s notice of Landlord’s initial determination of the Fair Market Rental Value, Landlord and Tenant shall meet no less than two (2) times, at a mutually agreeable time and place, to attempt to resolve any such disagreement.
(B) If, within the twenty (20) day consultation period described in subsection 3(d)(i)(A) above, Landlord and Tenant cannot reach an agreement as to the Fair Market Rental Value, they shall each make a separate determination of the Fair Market Rental Value within five (5) business days after the expiration of the said twenty (20) day period, and such determinations shall be submitted to arbitration in accordance with subsection 3(d)(i)(C) below; provided that, if only one (1) determination of Fair Market Rental Value is submitted to arbitration within the said five (5) business day period, then such determination shall be the Basic Rent for the Extension Term and the parties shall not proceed with arbitration.
(C) If the Basic Rent has not been determined pursuant to the procedures outlined above, Landlord and Tenant shall each appoint one arbitrator who shall be either a real estate broker or MAI appraiser and shall have been active over the five (5) year period ending on the date of such appointment in the leasing of commercial mid-rise and/or high-rise properties in the greater San Francisco metropolitan area. Each such arbitrator shall be appointed within five (5) business days after the expiration of the twenty (20) day period described in subsection 3(d)(i)(B) above. The two (2) arbitrators so appointed shall within ten (10) days of the date of appointment of the last appointed arbitrator agree upon and appoint a third arbitrator who shall be qualified under the same criteria set forth hereinabove for qualification of the first two (2) arbitrators. The determination of the arbitrators shall be limited solely to the issue of whether the Landlord’s or the Tenant’s submitted Fair Market Rental Value is the closest to the actual Fair Market Rental Value of the Premises, as determined by the arbitrators. The three (3) arbitrators shall within thirty (30) days of the appointment of the third arbitrator reach a decision as to whether the parties shall use the Landlord’s or the Tenant’s submitted Fair Market Rental Value as the Basic Rent for the Extension Term, and shall notify Landlord and Tenant thereof. The decision of the majority of the three (3) arbitrators shall be
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binding upon Landlord and Tenant. If either Landlord or Tenant fails to appoint an arbitrator within the five (5) business day period provided above, then the arbitrator appointed by one of them shall reach a decision, notify Landlord and Tenant thereof, and such arbitrator’s decision shall be binding upon Landlord and Tenant. If the two (2) arbitrators fail to agree upon and appoint a third arbitrator within the ten (10) day period provided above, or both parties fail to appoint an arbitrator within the five (5) business day period provided above, then Landlord shall prepare and submit to Tenant a list of three (3) proposed arbitrators that possess the required qualifications as set forth above; provided that none of such proposed arbitrators nor the firm for which any of them works shall be a current or past affiliate of either Landlord or Tenant or currently retained or employed by Landlord or Tenant. Within five (5) business days after receipt of such list, Tenant shall select an arbitrator therefrom and such person shall be the third or single, as the case may be, arbitrator hereunder. If Tenant fails to make such selection with such five (5) business day period, then Landlord shall select the third or single, as the case may be, arbitrator from such list. Each party shall pay the cost of the arbitrator which it first selects and the parties shall share equally the cost of the third arbitrator.
(i) Commencing as of the North Wing Commencement Date and continuing to and including the day immediately preceding the First (1st) Lease Month, Tenant agrees to pay Landlord Basic Rent with respect to the North Wing at the rate of Two Dollars and Ninety-Five Cents ($2.95) per month per square foot of Rentable Area contained in the North Wing.
(ii) Commencing as of the Second Floor South Wing Commencement Date and continuing to and including the day immediately preceding the First (1st) Lease Month, Tenant agrees to pay Landlord Basic Rent with respect to the Second Floor South Wing at the rate of Two Dollars and Ninety-Five Cents ($2.95) per month per square foot of Rentable Area contained in the Second Floor South Wing.
(iii) Commencing as of the Third Floor South Wing Commencement Date and continuing to and including the day immediately preceding the First (1st) Lease Month, Tenant agrees to pay Landlord Basic Rent with respect to the Third Floor South Wing at the rate of Two Dollars and Ninety-Five Cents ($2.95) per month per square foot of Rentable Area contained in the Third Floor South Wing.
(iv) Commencing as of the First (1st) Lease Month, Tenant agrees to pay Landlord Basic Rent with respect to the entire Premises at the following rates per square foot of Rentable Area in the entire Premises:
Lease Months |
Monthly Rate per Square Foot of Rentable Area in the Premises | ||
1-12 |
$ | 2.95 | |
13-24 |
$ | 3.04 | |
25-36 |
$ | 3.13 |
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37-48 |
$ | 3.22 | |
49-60 |
$ | 3.32 | |
61-72 |
$ | 3.42 | |
73-84 |
$ | 3.52 |
(b) Lease Month. The term “Lease Month” shall mean a period commencing as of a particular date and continuing to and including the day immediately preceding the same day of the next calendar month (or, if the next calendar month does not contain such a same day due to being shorter in duration, then continuing to and including the last day of such next calendar month). The First (1st) Lease Month shall commence as of the last to occur of the North Wing Commencement Date, Second Floor South Wing Commencement Date or Third Floor South Wing Commencement Date, and successive Lease Months shall be consecutively numbered.
(c) Method of Payment. Basic Rent with respect to the North Wing, Second Floor South Wing and Third Floor South Wing shall be payable monthly during the Term, commencing as to each such portion of the Premises as of the Commencement Date for such portion of the Premises as provided in the foregoing provisions of this Section 4. Each monthly installment of Basic Rent shall be payable in advance on the first day of each calendar month during the Term, except that the First (1st) Lease Month’s installment shall be paid within fifteen (15) days of full execution hereof. If the rate at which Basic Rent is payable under this Lease changes on a day other than the first day of a calendar month, then the Basic Rent for such calendar month shall be prorated on a daily basis to take such change into account, and any additional amount due as a result of such proration shall be paid on the first day of the calendar month for which the proration occurs. In addition to the Basic Rent, Tenant agrees to pay as additional rent the amount of additional rent and rent adjustments and other charges required by this Lease. All rent shall be paid to Landlord, without prior demand and without any deduction or offset (except as otherwise specifically provided in this Lease or under applicable law), in lawful money of the United States of America, at the address of Landlord designated in Section 36 below or to such other person or at such other place as Landlord may from time to time designate in writing. Except as otherwise provided in this Lease, in the event of a remeasurement or adjustment of the area of the Premises, the Basic Rent shall be recalculated using the Basic Rent rates set forth in this Section 4 (“Basic Rental Rates”).
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Commencing as of the later of the first (1st) anniversary of the Base Year or the thirteenth (13th) month anniversary of the first to occur of the North Wing Commencement Date, Second Floor South Wing Commencement Date or Third Floor South Wing Commencement Date, such additional amount shall be added to the monthly installment of Basic Rent payable by Tenant under this Lease for each month during such Operating Year.
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Operating Year, to and including such termination date, bears to three hundred sixty-five (365); and any amount payable by Landlord to Tenant or Tenant to Landlord with respect to such adjustment shall be payable within thirty (30) days after delivery of the statement of Actual Operating Expenses with respect to such Operating Year. The obligations of Tenant and Landlord to make adjusting payments pursuant to this Section 5 shall survive the expiration or earlier termination of this Lease.
(f) Definitions. The following terms shall have the respective meanings hereinafter specified:
(i) “Base Amount” shall mean an amount equal to the Actual Operating Expenses for the Base Year (as defined in the Basic Lease Information); provided that if less than ninety-five percent (95%) of the total Rentable Area of the Project is occupied during the Base Year, then the Actual Operating Expenses actually incurred for the Base Year shall be adjusted by Landlord to the amount which would have been incurred if ninety-five percent (95%) of the total Rentable Area of the Project had been completed with tenant improvements and leased and occupied, and as if all tenants were paying full rent (as opposed to free rent or half-rent, it being the intention that any expense, such as a management fee, that varies with the amount of rent paid shall be calculated as if all tenants were paying full rent), for the entire Base Year.
(ii) “Common Areas” shall, subject to the provisions of Section 44, mean the areas of the Building and the Project devoted by Landlord to non-exclusive uses such as lobbies, fire vestibules, rest rooms, mechanical areas, tenant and ground floor corridors, elevator foyers, electrical and janitorial closets, ground floor lobbies, telephone and equipment rooms, parking areas, landscaping, the flat portions of the roof of the Building, and other similar facilities maintained for the benefit of Building tenants and invitees.
(iii) “Operating Year” shall mean a calendar year commencing January 1 and ending December 31.
(iv) “Operating Expenses” shall mean all expenses Landlord has paid or incurred, or become obligated to pay or incur, for maintaining, owning, operating and repairing the Project, including, without limitation, the Building, and the personal property used in conjunction therewith, determined in accordance with generally accepted accounting principles, consistently applied, including, but not limited to expenses incurred or paid for: (i) Property Taxes (as hereinafter defined); (ii) utilities for the Project, including but not limited to electricity, power, gas, steam, oil or other fuel, water, sewer, lighting, heating, air conditioning and ventilating; (iii) permits, licenses and certificates necessary to operate, manage and lease the Project; (iv) insurance Landlord deems appropriate to carry; (v) supplies, tools, equipment and materials used in the operation, repair and maintenance of the Project; (vi) accounting, legal, inspection, consulting, concierge and other services; (vii) equipment rental (or installment equipment purchase or equipment financing agreements); (viii) management agreements (including the cost of any management fee actually paid thereunder and the fair rental value of any office space provided thereunder, up to customary and reasonable amounts); (ix) wages, salaries and other compensation and benefits (including the fair value of any parking privileges provided) for all persons at or below the level of Director of Operations engaged in the operation, maintenance or security of the Project, and employer’s Social Security taxes,
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unemployment taxes or insurance, and any other taxes which may be levied on such wages, salaries, compensation and benefits; (x) payments under any easement, operating agreement, declaration, restrictive covenant, or instrument pertaining to the sharing of costs in any planned development or similar arrangement; (xi) operation, repair and maintenance of all systems and equipment and components thereof (including replacement of components); (xii) janitorial service, alarm and security service, window cleaning, trash removal, elevator maintenance, and cleaning of walks, parking facilities and building walls; (xiii) replacement of wall and floor coverings, ceiling tiles and fixtures in lobbies, corridors, restrooms and other common or public areas or facilities; (xiv) maintenance and replacement of shrubs, trees, grass, sod and other landscape items, irrigation systems, drainage facilities, fences, curbs, and walkways; (xv) re-paving (which expenditures shall, to the extent such expenditures are capital expenditures, be amortized for purposes of this Lease over the useful life of the items being amortized, as determined by Landlord in its reasonable discretion) and re-striping parking facilities; (xvi) roof repairs and replacement, which expenditures shall, to the extent such expenditures are capital expenditures, be amortized for purposes of this Lease over the useful life of the items being amortized (as determined by Landlord in its reasonable discretion); and (xvii) capital expenditures made to reduce Operating Expenses (provided that the amount chargeable as an Operating Expense in any year shall not exceed Landlord’s reasonable determination of the efficiency achieved either in direct cost savings, avoidance of cost increases or a combination of both), or to comply with any laws or other governmental requirements, or for replacements (as opposed to additions or new improvements) of non-structural items located in the Common Areas of the Project required to keep such areas in good condition, which capital expenditures shall be amortized for purposes of this Lease over the useful life of the items being amortized (as determined by Landlord in its reasonable discretion). Notwithstanding the foregoing to the contrary, Operating Expenses shall not include (a) depreciation, interest and amortization on mortgages or other debt costs or ground lease payments, if any; (b) legal fees, accounting fees and other expenses incurred in connection with leasing, tenant disputes or enforcement of leases (as opposed to accounting fees and other expenses incurred in connection with the operation of the Project or the determination of Operating Expenses) or disputes regarding or associated with the enforcement or defense of Landlord’s title to or interest in the Project or any part thereof; (c) real estate brokers’ leasing commissions; (d) improvements or alterations to tenant spaces; (e) the cost of providing any service directly to and paid directly by, any other tenant of the Project (other than through payment of a proportionate share of Actual Operating Expenses or other similar general operating expense reimbursement procedure); (f) costs of any items to the extent Landlord receives reimbursement from insurance proceeds or from a third party (such proceeds to be deducted from Operating Expenses in the year in which received); (g) capital expenditures except those capital expenditures specifically referenced in the preceding sentence; (h) costs incurred by Landlord which are associated with the operation of the business of the legal entity which constitutes Landlord as the same is separate and apart from the cost of the maintenance, operation and repair of the Project, including legal entity formation and legal entity accounting (including the incremental accounting fees relating to the operation of the Building to the extent incurred separately in reporting operating results to the Building’s owners or lenders); (i) costs incurred by Landlord due to the violation by Landlord or any other specific tenant of the terms and condition of any lease of space in the Building or Project, which would not have otherwise been incurred in the absence of such violation; (j) if and during such time that Landlord is managing the Building on its own behalf or through an affiliate, any management fee in excess of that obtainable from a first-class management company unaffiliated with Landlord which does
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not have a brokerage listing agreement with Landlord for the Building or any other building owned by Landlord; (k) any cost representing an amount paid to any person, firm, corporation or other entity related to or affiliated with Landlord, which amount is in excess of the amount which would have reasonably been paid in the absence of such relationship for comparable work or services involving the Building or comparable buildings in the general vicinity of the Building; (l) costs for repairs or replacements covered by third-party warranties or guarantees, to the extent actually collected by Landlord; (m) costs of repairs and general maintenance paid by proceeds of insurance or directly and separately by Tenant or other third parties; (n) costs (including legal expenses and all costs related to remediation) incurred by Landlord in connection with the investigation or remediation of Hazardous Materials, to the extent (and only to the extent) that: (A) such Hazardous Materials were present on the Project as of the first to occur of the North Wing Commencement Date, Second Floor South Wing Commencement Date or Third Floor South Wing Commencement Date, and were not brought onto the Project by Tenant or its agents, employees or contractors; or (B) such Hazardous Materials were first brought onto the Project by Landlord or its agents, employees or contractors; (o) advertising and marketing expenses; (p) any bad debt loss, rent loss, or reserves for bad debts or rent loss, or reserves for capital expenditures with respect to the maintenance, ownership, operating or repair of the Project; (q) any and all costs incurred by Landlord in connection with the transfer or disposition of Landlord’s interest in the Project, except with respect to Property Taxes (including, without limitation, with respect to an increase in Property Taxes in connection with a change of ownership re-assessment under Proposition 13); (r) the cost of repairs and/or restorations necessitated by condemnation or casualty insured or required to be insured by Landlord under this Lease; (s) any cost for which Landlord is reimbursed or entitled to reimbursement by other tenants of the Project; (t) expenses in connection with services provided to other tenants which would not be the standard services provided to Tenant under Section 9(a) of this Lease and which are of a type for which Tenant would be charged directly under this Lease but which are provided to another tenant or occupant of the Building without direct charge (or, if provided to such other tenant as a direct charge which does not reasonably approximate the actual cost to Landlord of the provision of such services, then the increment of difference between the actual cost of such services and the charge made to such tenant), (u) capital expenditures incurred in connection with upgrading the Common Areas in order to comply with any laws or other governmental requirements in effect as of the date of this Lease, and of which Landlord is actually in violation as of the date of this Lease (and for such purposes, Landlord shall not be deemed to be in violation of such laws or other governmental requirements unless Landlord has been notified of the violation as of the date of this Lease by the applicable government authority or authorities having jurisdiction and Landlord has failed to correct such violation as of the date of this Lease), (v) costs (including legal expenses and all costs related to remediation) incurred by Landlord in connection with the performance of its obligations under Section 25(f)(i) with respect to Hazardous Materials that were first brought onto the Project (except the Premises) on or following the first to occur of the North Wing Commencement Date, Second Floor South Wing Commencement Date or Third Floor South Wing Commencement Date but not by Landlord or Tenant or their respective agents, employees or contractors and are not otherwise related to the use or occupancy of the Premises, but only to the extent such costs are greater than five percent (5%) of all other Operating Expenses for the applicable Operating Year; and (w) costs in connection with the operation of income producing retail concession operations owned by Landlord (and not leased or licensed to a third party) and located within the Project. In the event Landlord incurs, subsequent to the Base Year, any new item or category of expense which was not included in the
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Base Year, Operating Expense for the Base Year shall be deemed increased (i.e., “grossed up”) by the amounts Landlord would have incurred during the Base Year with respect to such expense. If any Operating Expense, though paid in one year, relates to more than one Operating Year, such Operating Expense shall be proportionately allocated among such related Operating Years. If any portion of the Project is covered by a warranty or service agreement at any time during the Base Year and to the extent the Project is not covered by such warranty or service agreement during a subsequent Operating Year, Operating Expenses for the Base Year shall be deemed increased by such amount as Landlord would have incurred during the Base Year with respect to the items or matters covered by the subject warranty or service agreement, had such warranty or service agreement not been in effect during the Base Year. In no event shall Landlord collect in total, from Tenant and all other tenants of the Project, an amount greater than one hundred percent (100%) of the Operating Expenses during any year of the Term.
(v) “Estimated Operating Expenses” shall mean Landlord’s estimate of Operating Expenses for the following Operating Year, adjusted, if (at any time during the entire Operating Year) less than ninety-five percent (95%) of the total Rentable Area of the Project had been occupied, as if ninety-five percent (95%) of the total Rentable Area of the Project had been occupied, and as if all tenants were paying full rent (as opposed to free rent or half-rent, it being the intention that any expense, such as a management fee, that varies with the amount of rent paid shall be calculated as if all tenants were paying full rent), for the entire Operating Year.
(vi) “Actual Operating Expenses” shall mean the actual Operating Expenses for any Operating Year, adjusted, if (at any time during the entire Operating Year) less than ninety-five percent (95%) of the total Rentable Area of the Project had been occupied, as if ninety-five percent (95%) of the total Rentable Area of the Project had been occupied, and as if all tenants were paying full rent (as opposed to free rent or half-rent, it being the intention that any expense, such as a management fee, that varies with the amount of rent paid shall be calculated as if all tenants were paying full rent), for the entire Operating Year.
(vii) “Property Taxes” shall mean all real and personal property taxes and assessments and charges imposed by any governmental authority or agency on the Project; any assessments levied in lieu of such taxes; any tax on or measured by gross rents received from the rental of space in the Project; and any other costs levied or assessed by, or at the direction of, any federal, state, or local government authority in connection with the use or occupancy of the Project or the Premises or the parking facilities serving the Project; any tax on this transaction or any document to which Tenant is a party creating or transferring an interest in the Premises, and any expenses, including the reasonable cost of attorneys or experts, incurred by Landlord in seeking reduction by the taxing authority of the above-referenced taxes, but only to the extent of any tax refunds obtained as a result of an application for review thereof; but shall not include (a) any net income, franchise, estate, inheritance taxes, documentary transfer taxes (other than with respect to this Lease, if any), or any gross receipts tax levied solely by reason of the existence of Landlord as a particular entity (as opposed to any gross receipts tax levied as a function of gross rents collected by Landlord whether or not Landlord exists as a particular entity); (b) any increase in Property Taxes to the extent resulting solely from a change of ownership reassessment under Proposition 13, but excluding any increase in Property Taxes resulting from the first such change of ownership; or (c) any cost or expense that is specifically excluded from the definition of Operating Expenses. If the Project is not fully assessed for Property Taxes during the Base Year, the Property Taxes for the Base Year shall be grossed up to reflect what they would have been had the Project been fully assessed during the Base Year.
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8. IMPROVEMENT AND ACCEPTANCE OF PREMISES.
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intended by Tenant and were in good and satisfactory condition at the time such possession was taken, except as provided in Exhibit B and Landlord’s maintenance and repair obligations under this Lease. Landlord and Tenant shall inspect the Premises after the improvements to be constructed in the Premises by Landlord are Substantially Complete, as that term is defined in Exhibit B, and shall together prepare a punchlist, as provided in Exhibit B.
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at an hourly rate equivalent to Landlord’s estimated actual cost of providing such service. Landlord shall also provide lighting replacement for Landlord-furnished lighting, toilet room supplies, window washing with reasonable frequency, and hot and cold water at those points of supply typically provided at Class “A” office projects in Marin County. Landlord shall not be liable to Tenant for any loss or damage caused by or resulting from any variation, interruption or failure of said services due to any cause whatsoever; and no temporary interruption or failure of such services shall be deemed an eviction of Tenant or relieve Tenant from any of Tenant’s obligations hereunder, except to the extent expressly provided in Section 9(b).
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(a) Landlord’s Obligations. Landlord shall, consistent with the operation of a Class “A” office project in Marin County, maintain and keep in good repair the foundations, exterior walls, structural portions of the roof and other structural portions of the Building (including, but not limited to, the floor/ceiling slabs, curtain wall, exterior glass and mullions, columns, beams, shafts (including elevator shafts) collectively the “Building Structure”), and shall maintain the electrical, plumbing, heating and ventilating equipment in the Building (the “Building Systems”), except such portions thereof as may be or have been specially or specifically installed for use in or with respect to the Premises or otherwise constructed or altered by Tenant in connection with Tenant’s work or otherwise, and shall maintain the Common Areas (including, but not limited to, the stairs, parking areas, stairwells, escalators, elevator cabs, plazas, pavement, sidewalks, curbs, entrances, landscaping, artwork, sculptures and washrooms); and except that all damage or injury to the Premises, the Building or the equipment and improvements therein caused by any act, neglect, misuse or omission of any duty by Tenant or by any persons who may be in or upon the Premises, the Building or the Project with the express or implied consent of Tenant shall be paid by Tenant, subject to the provisions of Section 20. Landlord’s maintenance obligations hereunder shall be performed in a first-class manner. Subject to the provisions of Section 9(b) above and Section 10(b) below, Landlord shall not be liable for any failure to make any such repairs or to perform any maintenance unless such failure shall persist for an unreasonable time after written notice of the need of such repairs or maintenance is given by Tenant to Landlord. Tenant hereby waives and releases its right to make repairs at Landlord’s expense under Sections 1941 and 1942 of the California Civil Code or under any similar law, statute or ordinance now or hereafter in effect. Landlord makes no warranty as to the quality, continuity or availability of the telecommunications services in the Building, and Tenant hereby waives any claim against Landlord for any actual or consequential damages (including damages for loss of business) if Tenant’s telecommunications services in any way are interrupted, damaged or rendered less effective, except to the extent such claims arise out of the gross negligence or willful misconduct of Landlord, or Landlord’s employees, agents or contractors.
(b) Limited Tenant Offset Right.
(i) If Landlord fails in a material manner to perform its maintenance obligations which: (i) Landlord is obligated to perform under this Lease; (ii) materially and adversely affects Tenant’s access to and use of any portion of the Premises (such portion so affected referred as the “Affected Portion”) for Tenant’s intended business purposes; and, (iii) causes Tenant to actually cease to use the Affected Portion for Tenant’s intended business purposes; then, Tenant may give to Landlord written notice of such failure, which notice shall include a statement that Tenant demands that Landlord promptly perform such maintenance obligation and a statement that Tenant intends to seek remedy under the provisions of this Section 10(b). Tenant shall also state in such notice: (i) whether or not such failure by Landlord materially and adversely affects Tenant’s access to and use of the Affected Portion for Tenant’s
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intended business purposes, and causes Tenant to actually cease to use the Affected Portion for Tenant’s intended business purposes; and (ii) in reasonable detail, the steps Tenant believes are necessary in order for Landlord to cure such failure. In the event that Tenant provides such notice to Landlord, Landlord shall promptly commence to perform such maintenance obligation.
(ii) In the event that Landlord has not commenced to perform such maintenance obligation within seven (7) business days from the receipt by Landlord of such notice from Tenant (or, if such performance cannot be commenced within such period of seven (7) business days, Landlord has not commenced the efforts necessary for such performance or has not thereafter diligently pursued such efforts), Tenant may provide Landlord an additional notice containing the information and statements required with respect to Tenant’s initial notice pursuant to Section 10(b)(i) above. In the event that Landlord has not commenced to perform such maintenance obligation within three (3) business days from the receipt by Landlord of such second notice from Tenant (or, if such performance cannot be commenced within such period of three (3) business days, Landlord has not commenced the efforts necessary for such performance or has not thereafter diligently pursued such efforts), Tenant may undertake such performance, but only if and to the extent that such performance does not: (i) treat the premises of another tenant or occupant of the Building less beneficially than the Premises under the circumstances; (ii) materially affect the use of or access to the premises leased or occupied by another tenant or occupant of the Building; and, (iii) require Tenant to operate or otherwise control the mechanical, electrical and plumbing systems of the Building. If such maintenance obligation is to be performed by a contractor and not by Tenant through the use of its employees, Tenant shall use contractors approved by Landlord in advance, which approval shall not be unreasonably withheld, conditioned or delayed.
(iii) In connection with such performance, Tenant may demand that Landlord reimburse to Tenant the positive difference resulting from subtracting: (i) the amount which would have been paid by Tenant through Tenant’s Proportionate Share of Operating Expenses, had Landlord performed such obligation and in included the costs and expenses therefor in Operating Expenses for the applicable Operating Year; from (ii) the costs incurred by Tenant in connection with such performance. The foregoing notwithstanding, in the event that Landlord does not believe that Tenant is entitled to such reimbursement (whether because Landlord believes that it is not obligated by this Lease to perform such maintenance obligation demanded by Tenant or that it has been performing such obligation in a manner consistent with the requirements of this Lease), Landlord shall so notify Tenant, and such dispute shall be resolved by arbitration before a single arbitrator, to be held in accordance with the arbitration rules of the American Arbitration Association. The arbitrator shall be an attorney familiar with handling commercial lease matters. Judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction over the dispute; provided, however, that the determination of the arbitrator shall be limited solely to the issues of whether: (i) Landlord breached its maintenance obligations required to be perform under this Lease; (ii) such breach materially and adversely affected Tenant’s access to and use of the alleged Affected Portion for Tenant’s intended business purposes; (iii) such breach caused Tenant to actually cease to use the alleged Affected Portion for Tenant’s intended business purposes; and (iv) Tenant’s performance of such obligation was in compliance with the provisions of this Section 10(b) and was reasonable in the circumstances.
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(iv) If Tenant obtains an arbitration award against Landlord which is not satisfied by Landlord within sixty (60) days of the date upon which such award becomes final, Tenant may offset against monthly installments of Base Rent, until the entire amount so awarded has been offset.
(v) Anything to the contrary contained in this Section 10(b) notwithstanding, any notice given by Tenant under this Section 10(b) shall also be given to all Prior Lien holders (as defined in Section 26), the address of which Landlord has previously notified Tenant in writing, by the same method and manner of delivery to Landlord, and if not so given, such notice shall be deemed invalid and ineffective.
(d) Tenant’s Obligations. Tenant shall at its expense maintain, repair and replace all portions of the Premises and the equipment or fixtures relating thereto, except to the extent specified in Section 10(a) above, at all times in good condition, appearance and repair, all in accordance with the laws of the State of California and all health, fire, police and other ordinances, regulations and directives of governmental agencies having jurisdiction over such matters. Tenant shall replace at Tenant’s sole expense any glass that may be broken in the Premises, and, subject to the provisions of Section 20, elsewhere in the Building or the Project if done through any fault or negligence of any of the Tenant Parties, with glass of the same size, specifications and quality, with signs thereon, if required.
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mechanic working in the Premises to provide lien waivers and liability insurance covering the Alterations to the Premises and to require Tenant to secure, at Tenant’s sole cost and expense, completion and lien indemnity bonds satisfactory to Landlord, and/or to require such other instruments as may be reasonably requested by Landlord. In addition to the foregoing, Tenant shall provide Landlord with evidence that Tenant carries “Builder’s All Risk” insurance in an amount approved by Landlord covering the construction of such Alterations, and such other insurance as Landlord may require, it being understood and agreed that all of such Alterations shall be insured by Tenant pursuant to Section 19(a) of this Lease immediately upon completion thereof. Prior to the performance of any Alterations, Tenant shall allow Landlord to enter the Premises and post appropriate notices to avoid liability to contractors or material suppliers for payment for any Alterations. All Alterations shall remain in and be surrendered with the Premises as a part thereof at the expiration or earlier termination of this Lease, without disturbance, molestation or injury, provided that Landlord may advise Tenant at the time Landlord approves any non-permanent Alteration that Landlord shall require such non-permanent Alteration to be removed upon the expiration or earlier termination of this Lease pursuant to the provisions of Section 39 (but subject to the last sentence of this Section 11(c)). In such event, all expenses to restore said space to normal building standards shall be borne by Tenant. If Tenant fails to complete the removal and/or to repair any damage caused by the removal of any Alterations which are required to be removed as provided above, Landlord may do so and may charge the cost thereof to Tenant. If at the time of approval or consent (and only if such approval or consent is required), Landlord fails to inform Tenant that such Alteration must be removed, then Tenant shall not be required to remove such Alteration.
(d) Landlord’s Expenses; Administrative Fee. Tenant shall pay to Landlord, as additional rent, any reasonable and actual out-of-pocket costs incurred by Landlord in connection with the review, approval and supervision of the Alterations and for any additional Building services provided to Tenant or to the Premises in connection with any such alterations, additions or improvements which are beyond the normal services provided to occupants of the Building. Tenant shall also pay to Landlord an administration fee equal to three percent (3%) of the cost of the work to compensate Landlord for the administrative costs incurred in the review, approval and supervision of the Alterations (other than the initial Tenant Improvements for the Premises constructed pursuant to Exhibit B hereof). Under no circumstances shall Landlord be liable to Tenant for any damage, loss, cost or expense incurred by Tenant on account of Tenant’s plans and specifications, Tenant’s contractors or subcontractors, or Tenant’s design of any work, construction of any work or delay in completion of any work.
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obligations under this Section and Section 10 or either of them shall include, without limitation, the responsibility of Tenant to make substantial repairs, improvements or Alterations to the extent provided above, regardless of, among other factors, the relationship of the cost of curative action to the Rent under this Lease, the length of the then remaining Term hereof, the relative benefit of the repairs to Tenant or Landlord, the degree to which the curative action may interfere with Tenant’s use or enjoyment of the Premises, or the likelihood that the parties contemplated the particular law involved. Tenant waives any rights now or hereafter conferred upon it by any existing or future law to terminate this Lease or to receive any abatement, diminution, reduction or suspension of payment of Rent by reason of the obligations of Tenant under this Section 12. In no event, however, shall Tenant be responsible for any structural upgrade required to be made to the Premises, except to the extent that the requirement of such upgrade is imposed due to the use of the Premises by Tenant for other than general office use or any Alteration made or proposed to be made by Tenant. Landlord acknowledges to Landlord’s actual knowledge, without duty of inquiry or investigation, that as of the date of this Lease, the Project is not in violation of any local, state or federal law, statute, ordinance or governmental rule, regulation or requirement with which the Project is required to comply as of the date of this Lease (and for such purposes, Landlord shall not be deemed to be in violation of such local, state or federal law, statute, ordinance or governmental rule, regulation or requirement unless Landlord has been notified of the violation as of the date of this Lease by the applicable government authority or authorities having jurisdiction and Landlord has failed to correct such violation as of the date of this Lease).
(a) During the Term, as the same may be extended, Tenant shall have the use of a number of unreserved vehicle parking privileges (the “Parking Privileges”) equal to the product (rounded to the nearest whole Parking Privilege) of: (i) the total number of square feet of Rentable Area contained in the Premises; multiplied by (ii) the ratio of four (4) to One Thousand (1,000). The right of Tenant to use such Parking Privileges shall be at no charge (except as otherwise specifically provided in this Lease) to Tenant and shall be subject to such reasonable and non-discriminatory rules and regulations as Landlord or its parking operator may establish from time to time and to all applicable laws, ordinances, rules and regulations. Landlord may assign any unreserved and unassigned parking spaces or designate all or a portion of such spaces reserved or institute an attendant-assisted tandem parking program or valet parking program if Landlord determines in its sole discretion that such is necessary for orderly parking, provided that the Parking Privileges are not materially and adversely affected thereby.
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(b) Subject to the remaining provisions hereof, Landlord shall use commercially reasonable efforts to provide Tenant an additional fifty (50) unreserved vehicle parking privileges, or such lesser amount that Landlord is able to actually provide (the “Additional Parking Privileges”), at the Project or (to the extent not available at the Project) at the lot adjacent to the Project (the “Lot”) which is owned or controlled by Landlord as of the date of this Lease. Landlord and Tenant acknowledge that the Lot is leased to or occupied by a third party as of the date of this Lease, and is not improved or zoned for parking in accordance with applicable law. To the extent that Tenant desires such Additional Parking Privileges, Tenant shall communicate such desire to Landlord in writing, and shall reimburse Landlord for all costs and expenses incurred by Landlord in improving and rezoning the Lot in accordance with applicable law for parking (to the extent such Additional Parking Privileges are to be provided at the Lot and not the Project) in addition to all other costs and expenses incurred by Landlord in connection with initially providing such Additional Parking Privileges to Tenant, provided that in each instance Landlord shall first submit a reasonable estimate of such costs and expenses to Tenant for Tenant’s approval prior to Landlord incurring such costs and expenses. Following the date such Additional Parking Privileges are provided to Tenant for Tenant’s use, Tenant shall pay to Landlord, on a monthly basis and in advance, the then prevailing market rate for such Additional Parking Privileges as reasonably determined by Landlord or its parking operator from time-to-time (which prevailing market rate may then be Zero and No/100ths Dollars ($0.00)). Except as specifically set forth in this Section 14(b), Tenant’s rights and obligations with respect to the Additional Parking Privileges provided to Tenant pursuant to this Section 14(b) shall be the same as Tenant’s rights and obligations with respect to the Parking Privileges under the provisions of this Lease.
(c) Tenant may permit its employees, contractors and visitors to use the Parking Privileges described in Section 14(a) above. Tenant shall use all reasonable efforts to confine parking by its employees and contractors to the parking lot or lots designated by Landlord for the use of tenants of the Building and to cause them to comply with such reasonable and non-discriminatory rules and regulations as Landlord or its parking operator may establish from time to time and to all applicable laws, ordinances, rules and regulations. Tenant shall not use, or permit its employees or contractors to use, any spaces which have been or are hereafter designated by Landlord for use only by persons or vehicles qualifying to use handicapped, vanpool, carpool or other restricted categories of use (except to the extent that employees or contractors or their vehicles are qualified to use such designated spaces) or assigned to other tenants. Only passenger cars, light trucks and motorcycles may be parked in the parking lots by Tenant or its employees and contractors, and no vehicle shall be permitted to remain there for a period of more than twenty-four (24) consecutive hours. Landlord may also institute a card or other electronic access system to the parking areas, and Tenant shall cooperate reasonably with Landlord in implementing such system, including requiring that all users of the Parking Privileges sign commercially reasonable agreements with Landlord regarding the use of the Parking Privileges. Tenant shall receive one (1) card or other access device per Parking Privilege to which Tenant is then entitled.
(d) Landlord may refuse to permit any person who violates the parking rules and regulations to park at the Project, and any violation of the rules and regulations shall subject the car to removal at the expense of the owner. Any user of the Parking Privileges shall retain all responsibility for damages to cars or other property arising from or in connection with such
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user’s use of the Parking Privileges, and Landlord shall have no responsibility for any property damage or personal injury resulting from use of the parking lots at the Project. Tenant shall repair or cause to be repaired at its sole cost and expense any and all damage to the Project or any part thereof caused by Tenant or its employees or contractors or resulting from vehicles of its employees and contractors.
(e) If the City of San Xxxxxx or any other local, state or federal governmental agency or authority hereafter imposes any traffic systems management program which applies to the Building or Tenant, Tenant shall cooperate reasonably with the requirements of such program.
(a) Landlord’s Consent. Without the express prior written consent of Landlord, Tenant shall not directly or indirectly, voluntarily or by operation of law, sell, assign, encumber, pledge, or otherwise transfer or hypothecate all or any part of its interest in or rights with respect to the Premises (collectively, “Assignment”), or permit all or any portion of the Premises to be occupied by anyone other than Tenant and its employees or sublet all or any portion of the Premises or transfer a portion of its interest in or rights with respect to the Premises (collectively, “Sublease”).
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(i) Within fifteen (15) days after Landlord’s receipt of the Transfer Notice, Landlord shall elect to consent to the Sublease or Assignment, or disapprove the Sublease or Assignment; provided, however, that Landlord agrees not to unreasonably withhold its consent to the Sublease or Assignment. If Landlord does not make such election within such fifteen (15) day period, Tenant may re-deliver such Transfer Notice to Landlord. If Landlord does not make such election within five (5) days following receipt of such second Transfer Notice, the Sublease or Assignment as to which such Transfer Notice was given shall be deemed approved by Landlord.
(ii) Without limiting in any way the other grounds upon which Landlord may withhold its consent, Landlord’s consent shall not be deemed to have been unreasonably withheld if: (A) the proposed sublessee or assignee is a new concern with no previous business history; (B) if the proposed sublessee or assignee intends to use the Premises for executive suites or for any use which would materially increase the density of occupants of the Premises: (C) any other use inconsistent with Section 6 or the operation of a first-class office building or in a manner which would increase the use of, or the possibility of disturbance of, Hazardous Materials on the Project; (D) the proposed Transferee is not of sound financial condition as reasonably determined by Landlord; (E) the proposed use or the proposed assignee or subtenant would cause the violation of any covenant or agreement of Landlord to any third party or would permit any other tenant to terminate its lease; or (F) the proposed subtenant or assignee then leases or occupies any other space in the Building, unless there is then no space in the Building comparable to the space subject to the proposed assignment or subletting. Landlord’s failure to make such election within fifteen (15) days after Landlord’s receipt of the Transfer Notice shall be deemed to be Landlord’s approval of the proposed Sublease or Assignment.
(i) Tenant may thereafter, within ninety (90) days after Landlord’s consent, enter into such Assignment or Sublease, but only with the party and upon the same terms as set forth in the Transfer Notice;
(ii) In the case of a Sublease, Tenant shall pay to Landlord monthly, together with monthly installments of rent hereunder, fifty percent (50%) of the difference for such month between (x) any and all sums payable to Tenant in connection with such Sublease (including key money, bonus money and any payment in excess of fair market value for services rendered by Tenant in connection with such Sublease or for assets, fixtures, inventory, equipment or furniture transferred by Tenant in connection with such Sublease), minus (y) the sum of the proportionate
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amount (on a Rentable Area basis) of Basic Rent payable by Tenant under this Lease for the space covered by such Sublease plus any actual and reasonable out-of-pocket costs incurred by Tenant in connection with such Sublease (including, but not limited to, brokerage commissions, legal fees, improvement allowances, rent abatements and rent paid during vacancy);
(iii) In the case of an Assignment, Tenant shall pay to Landlord, as and when received, fifty percent (50%) of the difference between (x) any transfer or assignment fee, purchase price or other consideration received by Tenant in connection with the Assignment attributable to the value of this Lease (if other assets are transferred in connection with the Assignment, a fair allocation of value shall be made to this Lease for the purposes of this Section 16, independent of any allocation made as between Tenant and the assignee for their own purposes), minus (y) the sum of the Basic Rent payable by Tenant under this Lease for the Premises plus any actual and reasonable out-of-pocket costs incurred by Tenant in connection with such Assignment (including, but not limited to, brokerage commissions, legal fees, improvement allowances, rent abatements and rent paid during vacancy);
(iv) Any Sublease or Assignment shall be subject to all of the provisions of this Lease, and Landlord’s consent to any Sublease or Assignment shall not be construed as a consent to any terms thereof which conflict with any of the provisions of this Lease except to the extent that Landlord specifically agrees in writing to be bound by such conflicting terms; and
(v) No Transferee (other than an Affiliate or Successor which has been assigned Tenant’s rights under this Lease pursuant to Section 16(h) below) shall have the right to exercise any right or option under this Lease to lease additional space, extend the Term, or terminate this Lease.
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unless Landlord shall receive a counterpart of the Assignment and an instrument in recordable form that contains a covenant of assumption by the Transferee reasonably satisfactory in substance and form to Landlord and consistent with the requirements of this Section 16 but the failure of the Transferee to execute such instrument shall not release the Transferee from its liability as set forth above. Tenant shall reimburse Landlord, within fifteen (15) days after Tenant’s receipt of an invoice therefor, for any costs that Landlord may incur in connection with any proposed Assignment or Sublease, including Landlord’s reasonable attorneys’ fees and the costs of investigating the acceptability of any proposed Transferee; provided, however, that if the documents and supporting data will only require the preparation, delivery and execution of Landlord’s standard form of consent to such Assignment or Sublease without material negotiation, then such legal fees shall not exceed Two Thousand Five Hundred Dollars ($2,500.00).
(h) Transfers to Affiliates or Successors.
(i) Anything to the contrary contained in this Section 16 notwithstanding, Tenant may sublet the Premises or any part thereof, or assign its interest in this Lease, to an Affiliate (defined below) of Tenant or a Successor (defined below) to Tenant without the necessity of obtaining the consent of Landlord and without the obligation to pay the amount provided for in Sections 16(c)(ii) or 16(c)(iii) above. In the event that Tenant so sublets the Premises or any part thereof, or assigns its interest in this Lease, to an Affiliate or Successor, Tenant shall remain primarily liable with respect to its obligations under this Lease.
(ii) For purposes of this Section 16(h), the term “Affillate” shall mean any corporation, partnership or limited liability company which directly or indirectly controls or is controlled by or is under common control with Tenant (for this purpose, “control” shall mean the possession, directly or indirectly, of both the power to direct or cause the direction of the management and policies of the entity, whether through the ownership of voting securities or partnership shares or by contract or otherwise, when combined with the ownership, directly or
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indirectly, of not less than fifty percent (50%) of all classes of the then outstanding stock, if the entity is a corporation, or of fifty percent (50%) of all classes of the profit interests, if the entity is a partnership or a limited liability company).
(iii) For purposes of this Section 16(h), the term “Successor” shall mean: (i) a corporation into which or with which Tenant, its corporate successors or assigns, is merged or consolidated in accordance with the applicable statutory provisions for merger or consolidation of corporations, but only if, by operation of law or by effective provisions contained in the instruments of merger or consolidation, the liabilities of the corporations participating in such merger or consolidation are assumed by the corporation surviving the merger or created by such consolidation; (ii) any partnership or limited liability company into which Tenant is merged in accordance with the applicable statutory provisions for the merger of partnerships or limited liability companies, but only if the surviving entity agrees in writing that it has unconditionally assumed for the benefit of Landlord all of the obligations and liabilities of Tenant under this Lease; and, (iii) any corporation, partnership or limited liability company acquiring the leasehold interest of Tenant under this Lease and substantially all of the other property and assets of Tenant or its Successor, but only if such entity agrees in writing that it has unconditionally assumed for the benefit of Landlord all of the obligations and liabilities of Tenant under this Lease. Acquisition by Tenant or its successors of substantially all of the assets, together with the assumption of all or substantially all of the obligations and liabilities of any corporation, shall be deemed a merger of such corporation into Tenant for purposes of this Lease.
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(a) After reasonable prior notice (except in emergencies, where no such notice shall be required) and without materially interfering with Tenant’s use and access to the Premises, Landlord, its authorized agents, contractors, and representatives shall at any and all times have the right to enter the Premises to inspect the same, to supply janitorial service and any other service to be provided by Landlord to Tenant hereunder, to show the Premises to prospective purchasers or tenants during the last year of the Term and during any period when there is an uncured Event of Default by Tenant under this Lease, to post notices, to alter, improve or repair the Premises or any other portion of the Building, all without being deemed guilty of any eviction of Tenant and without abatement of rent. Landlord may, in order to carry out such purposes, erect scaffolding and other necessary structures where reasonably required by the character of the work to be performed, provided that the business of Tenant shall be interfered with as little as is reasonably practicable. Landlord shall at all times have and retain a key with which to unlock all doors in the Premises, excluding Tenant’s vaults and safes. Landlord shall have the right to use any and all means which Landlord may deem proper to open said doors in an emergency in order to obtain entry to the Premises. Any entry to the Premises obtained by Landlord pursuant to the terms hereof shall not be deemed to be a forcible or unlawful entry into the Premises, or an eviction of Tenant from the Premises or any portion thereof, and Tenant hereby waives any claim for damages for any injury or inconvenience to or interference with Tenant’s business, any loss of occupancy or quiet enjoyment of the Premises, and any other loss in, upon and about the Premises.
(b) Notwithstanding the foregoing provisions of this Section 18 or this Lease to the contrary, in the event the Premises is impaired by reason of the negligence or intentional acts of Landlord or its agents or employees, then the payment of Rent shall be abated during the period of such impairment, but only to the extent (determined on a square foot of Rentable Area basis) the Premises are so impaired. Furthermore, if such impairment is substantial and continues for a period of sixty (60) continuous days or more, Tenant shall have the right to terminate this Lease by written notice to Landlord within five (5) days of the end of such sixty (60) day period. As used in this Section 18(b), the following terms shall have the following meanings: (i) as to any portion of the Premises, such portion of the Premises shall be deemed “impaired” if for a period of five (5) consecutive business days following Tenant’s notice to Landlord of such impairment it shall be impossible or commercially impracticable for Tenant to conduct business from such portion of the Premises, and Tenant has actually ceased to conduct business from such portion of the Premises; (ii) such impairment shall be deemed to be caused by the “negligence or intentional acts of Landlord or its agents or employees” to the extent that
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such impairment results primarily from an intentional act of Landlord or a negligent act of Landlord; and (iii) an impairment shall be deemed to be “substantial” if more than fifty percent (50%) of the Premises becomes impaired under the foregoing standards. Anything in this Section 18(b) to the contrary notwithstanding, the entitlement of Tenant, if any, to an abatement of the Rent or any part thereof or a termination of this Lease following (i) damage to or destruction of the Premises or the Project shall be governed by the provisions of Section 21 and not by the provisions of this Section 18(b), and (ii) an interruption of standard services required to be provided by Landlord pursuant to Section 9(a) shall be governed by the provisions of Section 9(a) and not by the provisions of this Section 18(b).
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noncontributing with any other insurance available to Landlord, but only as to losses arising out of the negligent acts or omissions of Tenant. The foregoing notwithstanding, the self-insured retention amount under the insurance policies maintained by Tenant pursuant to the provisions of this Lease shall be subject to Landlord’s prior written approval which shall not be unreasonably withheld, conditioned or delayed; provided, however, that, so long as the Tenant under this Lease is Managed Health Network, Inc. (“Named Tenant”) or a Successor to Named Tenant, Named Tenant’s policy of Commercial General Liability Insurance may provide for a self-insured retention amount of not more than One Million Dollars ($1,000,000) in an occurrence and Three Million Dollars ($3,000,000) in the aggregate.
(iii) Workers’ Compensation Insurance. Workers’ Compensation and Employer’s Liability Insurance (as required by the laws of the State of California).
(b) Criteria for Tenant’s Policies. All such policies shall be written in a form satisfactory to Landlord and shall be taken out with insurance companies qualified to issue insurance in the State of California and holding an A.M. Best’s Rating of “A-” and a Financial Size Rating of “VII” or better, as set forth in the most current issue of Best’s Key Rating Guide. Such insurance shall provide that it is primary insurance, and not contributory with any other insurance in force for or on behalf of Landlord. Prior to the commencement of the Term, Tenant shall deliver to Landlord copies of certificates of insurance evidencing in a manner binding on the insurance carrier the existence of the amounts and forms of coverage required above and, except for the Special Form Policy, naming Landlord and any other person specified by Landlord, as an additional insured. No such policy shall be cancelable, terminable or reducible in coverage except after the insurer endeavors to provide thirty (30) days (or, in the event of nonpayment of premium, ten (10) days) prior written notice to Landlord. Tenant shall, within ten (10) days prior to the expiration of such policies, furnish Landlord with renewals or “binders” thereof, or upon ten (10) days prior written notice to Tenant, Landlord may order such insurance and charge the cost thereof to Tenant as additional rent, if Tenant fails to so notify Landlord. If Landlord obtains any insurance that is the responsibility of Tenant under this Section 19, Landlord shall deliver to Tenant a written statement setting forth the cost of any such insurance and showing in reasonable detail the manner in which it has been computed.
(i) Landlord shall maintain, or cause to be maintained, a policy of Commercial General Liability insurance with the premiums thereon fully paid in advance, issued by and binding upon an insurance company of good financial standing, insuring Landlord against any liability arising out of the lease, use, occupancy, or maintenance of the Project and all areas appurtenant thereto (other than the Premises, unless Landlord elects to extend such coverage to the Premises). Such insurance shall be in the amount of Two Million Dollars ($2,000,000) Combined Single Limit for injury to or death of one or more persons in an occurrence and Four Million Dollars ($4,000,000) in the aggregate (some reasonable portion of which may be maintained through an excess or umbrella policy, provided that any such excess or umbrella
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policy shall cover at least the same perils as a commercial general liability policy and shall not contain materially more extensive exclusions than such a policy), and for damage to tangible property (including loss of use) in an occurrence.
(ii) In addition, Landlord shall maintain, or cause to be maintained, a policy or policies of insurance with the premiums thereon fully paid in advance, issued by and binding upon an insurance company of good financial standing, insuring the Project against loss or damage by fire and such other hazards as Landlord may elect (that may include earthquake loss if Landlord elects to maintain such coverage) and contingencies for the full insurable value thereof, or, in the alternative, insuring for eighty percent (80%) of the replacement cost thereof (or such minimum amount as shall be required to eliminate operation of coinsurance provisions), exclusive of excavations and foundations; provided, however, that Landlord shall not be obligated to insure any furniture, equipment, machinery, goods or supplies not covered by this Lease that Tenant may keep or maintain in the Premises, or any real or personal property that Tenant is otherwise required to insure under this Lease. If the annual premiums charged Landlord for such property insurance exceed the standard premium rates because the nature of Tenant’s operations result in extra-hazardous or higher than normal risk exposure, then Tenant shall, upon receipt of appropriate premium invoices, reimburse Landlord for such increases in premium. All insurance proceeds payable under Landlord’s insurance carried hereunder shall be payable solely to Landlord, and Tenant shall have no interest therein.
(iii) To the extent available on commercially reasonable terms, Landlord shall carry rental loss insurance on the Project applicable to the perils covered by an All Risk Policy on the Project and pertaining to the Rent due under this Lease for not less than twelve (12) months. If Landlord concludes that such insurance is not available at commercially reasonable rates, Landlord shall promptly so notify Tenant in writing. If Landlord fails to carry such policy of insurance without so notifying Tenant and an event occurs which would otherwise result in an interruption in Rent which would have been covered by such policy had it been carried by Landlord, then Landlord shall be deemed to have received the proceeds of such insurance as if it had been carried by Landlord in the amounts and with the coverages required.
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(a) Repair and Restoration. If the Building and/or the Premises are damaged by fire or other perils covered by insurance carried by Landlord, Landlord shall, subject to the provisions of Section 21(b) below, have the following rights and obligations:
(i) If the Building and/or the Premises are damaged or destroyed by any such peril, to the extent the cost to repair exceeds twenty-five percent (25%) of the then full replacement value thereof or the damage thereto is such that the Building and/or the Premises cannot, in the reasonable estimate of Landlord, be repaired, reconstructed and restored within six (6) months from the date of such damage or destruction using customary diligence, Landlord shall, at its sole option, as soon as reasonably possible thereafter, either commence or cause the commencement of the repair, reconstruction and restoration of the Building and/or the Premises and prosecute or cause the same to be prosecuted diligently to completion, in which event this Lease shall remain in full force and effect; or within sixty (60) days after such damage or destruction, elect not to so repair, reconstruct or restore the Building and/or the Premises, in which event this Lease shall terminate. In either event, Landlord shall give Tenant written notice of its intention within said sixty (60) day period. If Landlord elects not to restore the Building and/or the Premises, this Lease shall be deemed to have terminated as of the date of such damage or destruction.
(ii) If the Building and/or the Premises are partially damaged or destroyed by any such peril, to the extent the cost to repair is twenty-five percent (25%) or less of the then full replacement value thereof, and if the damage thereto is such that the Building and/or the Premises reasonably may, in the reasonable estimate of Landlord, be repaired, reconstructed or restored within a period of six (6) months from the date of such damage or destruction using customary diligence, then Landlord shall commence or cause the commencement of and diligently complete or cause the completion of the work of repair, reconstruction and restoration of the Building and/or the Premises and this Lease shall continue in full force and effect.
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days after the date it is advised of such repair period. Tenant also shall have the right to terminate this Lease if Landlord fails to repair the Premises or the Building within the stated repair period as extended day-for-day for each day within such period containing an event of Force Majeure (as defined in Section 46(j)); provided that Tenant shall give written notice of such termination within sixty (60) days of the end of the stated repair period as so extended.
(e) Basic Rent Abatement. In the event of repair, reconstruction and restoration by or through Landlord as herein provided, the Basic Rent payable under this Lease shall be abated proportionately to the degree to which Tenant’s use of the Premises is materially impaired during the period of such repair, reconstruction or restoration; provided, however, that the amount of such abatement shall be limited to the amount recoverable by Landlord from applicable policies of rental loss insurance maintained or required to be maintained by Landlord pursuant to this Lease. Tenant shall not be entitled to any abatement, compensation or damages for loss of the use of the whole or any part of the Premises and/or any inconvenience or annoyance occasioned by such damage, repair, reconstruction or restoration, nor shall Tenant be entitled to any insurance proceeds, including those in excess of the amount required by Landlord for such repair, reconstruction or restoration. Tenant shall not be released from any of its obligations under this Lease due to damage or destruction of the Building and/or the Premises except to the extent and upon the conditions expressly stated in this Section 21.
(g) Waiver. The provisions of California Civil Code § 1932(2) and § 1933(4), which permit termination of a lease upon destruction of the Premises, are hereby waived by Tenant; and the provisions of this Section 21 shall govern in case of such destruction.
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effect as of the date that possession of the Project, the Building or the Premises is so taken (herein called “Date of the Taking”), and the Basic Rent and other sums payable hereunder shall be prorated and adjusted as of such termination date.
(d) Waiver. Except as may be otherwise provided herein, Tenant hereby waives and releases any right to terminate this Lease under Sections 1265.120 and 1265.130 of the California Code of Civil Procedure or under any similar law, statute or ordinance now or hereafter in effect relative to eminent domain, condemnation or takings.
23. DAMAGE TO TENANT’S PROPERTY AND EXCULPATION.
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employees or invitees, or (iii) which may arise through repair or alteration of any part of the Project or failure to make any such repair or alteration, except to the extent of the active negligence or willful misconduct of Landlord occurring as a result of Landlord’s failure to make any such repair or alteration within a reasonable period of time following the date upon which Landlord obtains actual knowledge of the required work, all unless covered by insurance required to be maintained by Tenant under this Lease. Tenant hereby waives the remedy of constructive eviction. Any other provision of this Lease to the contrary notwithstanding: (i) in no event shall Landlord have any liability to Tenant or any third party for any consequential damages whatsoever, including loss of revenue or profits; and (ii) nothing in this Section 23(b) shall be deemed to limit the right of Tenant to pursue its remedies against any contractor or subcontractor of Landlord in connection with any damage to property or injury or death to persons caused by such contractor or subcontractor.
(c) The foregoing provisions of this Section 23 and any other provision of this Lease to the contrary notwithstanding: (i) Tenant is not waiving any claim against Landlord arising from Landlord’s or the Landlord Parties’ intentional misconduct resulting in any injury to persons, except to the extent covered by insurance required to be maintained by Tenant under this Lease; and (ii) Tenant is not waiving any claim against Landlord arising from Landlord’s or the Landlord Parties’ active negligence resulting in any injury to persons, except with respect to injury to persons caused by theft, vandalism, assault, battery, act of God, breaches of security, acts of the public enemy, acts of terrorists or criminals, riot, strike, insurrection, war, court order, requisition or order of governmental body or authority.
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(a) Definitions. As used herein, the term “Hazardous Material” means any hazardous or toxic substance, material or waste which is or becomes regulated by, or is dealt with in, any local governmental authority, the State of California or the United States Government. Accordingly, the term “Hazardous Material” includes, without limitation, any material or substance which is (i) defined as a “hazardous waste,” “extremely hazardous waste” or “restricted hazardous waste” under Sections 25115, 25117 or 25122.7, or listed pursuant to Section 25140 of the California Health and Safety Code, Division 20, Chapter 6.5 (Hazardous Waste Control Law), (ii) defined as a “hazardous substance” under Section 25316 of the California Health and Safety Code, Division 20, Chapter 6.95 (Hazardous Materials Release Response Plans and Inventory), (iii) defined as a “hazardous substance” under Section 25281 of the California Health and Safety Code, Division 20, Chapter 6.7 (Underground Storage of Hazardous Substances), (iv) petroleum, (v) asbestos, (vi) listed under Article 9 or defined as hazardous or extremely hazardous pursuant to Article 11 of Title 22 of the California Administrative Code, Division 4, Chapter 20, (vii) designated as a “hazardous substance” pursuant to Section 311 of the Federal Water Pollution Control Act (33 U.S.C. § 1317), (viii) defined as a “hazardous waste” pursuant to Section 1004 of the Federal Resource Conservation and Recovery Act, 42 U.S.C. § 6902 et seq., or (ix) defined as a “hazardous substance” pursuant to Section 101 of the Compensation and Liability Act, 42 U.S.C. § 9601 et seq.
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(f) Landlord’s Duty to Remediate and Indemnity.
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(i) In the event that the Project or any portion thereof (except the Premises) is contaminated by Hazardous Materials and such Hazardous Materials were not first brought onto the Project by Landlord or Tenant or their respective agents, employees or contractors, Landlord shall use such efforts as a reasonable and prudent person would use in the circumstances to remediate as required by law, or to cause other potentially responsible parties to remediate as required by law, any contamination of the Common Area of the Project by Hazardous Materials as to which it is not the responsibility of Tenant to perform remediation. Where there are other potentially responsible parties who may bear responsibility for all or a portion of any required remediation, Landlord shall use such efforts as a reasonable and prudent person would regard as economically justified to use to cause such parties to perform that responsibility. The obligations of Landlord set forth in this Section 25(f)(i) shall be a part of the obligations of Landlord to repair the Common Areas set forth in Section 10(a).
(ii) In the event that such Hazardous Materials were first brought onto the Project by Landlord or its agents, employees or contractors, then Landlord shall immediately remediate such contamination at its expense to the full extent required by applicable law.
(iii) Subject to the provisions of Sections 25(a), 25(b), 25(c), 25(d), 25(e) and 46(e), Landlord releases Tenant from any liability for, waives all claims against Tenant and shall indemnify, defend and hold harmless Tenant, its officers, employees, and agents, against any and all claims, liabilities, damages, costs and expenses, including reasonable attorneys’ fees and costs incurred in defending against the same, arising from any actions by any governmental agency for clean up of Hazardous Materials on or under the Project, including costs of legal proceedings, investigation, clean up, monitoring, and restoration, including reasonable attorney’s fees, if, and only to the extent, the: (i) Hazardous Materials occur on or under the Project; (ii) Hazardous Material was not possessed, released or disposed of by Tenant or by any Tenant Party; and (iii) the contamination occurred prior to the first to occur of the North Wing Commencement Date, Second Floor South Wing Commencement Date or Third Floor South Wing Commencement Date. Also subject to the provisions of Sections 25(a), 25(b), 25(c), 25(d), 25(e) and 46(e), and additionally subject to Section 5, Landlord releases Tenant from any liability for, waives all claims against Tenant and shall indemnify, defend and hold harmless Tenant, its officers, employees, and agents, against any and all claims, liabilities, damages, costs and expenses, including reasonable attorneys’ fees and costs incurred in defending against the same, arising from any actions by any governmental agency for clean up of Hazardous Materials on or under the Project, including costs of legal proceedings, investigation, clean up, monitoring, and restoration, including reasonable attorney’s fees, but excluding any contamination of the Project to the extent caused (i) by the initial release, disposal, use or storage of Hazardous Materials in, on or about the Project by Tenant or any Tenant Party, and (ii) as a result of the active or passive negligence or willful misconduct of Tenant or any Tenant Party.
(iv) Nothing in this Section 25(f) shall, however, be deemed to prohibit Landlord from contesting in administrative and judicial proceedings any requirement of law for the performance of remediation.
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and extensions thereof. If any Prior Lien holder wishes to have this Lease prior to its Prior Lien, then and in such event, upon such Prior Xxxx xxxxxx’x notifying Tenant to that effect, this Lease shall be deemed prior to the Prior Lien. If any ground lease or underlying lease terminates for any reason or any mortgage or deed of trust is foreclosed or a conveyance in lieu of foreclosure is made for any reason, Tenant shall, notwithstanding any subordination, attorn to and become the tenant of the successor in interest to Landlord, provided that such successor in interest recognizes the interest of Tenant under this Lease if no default under this Lease then exists. Within fifteen (15) days of presentation, Tenant shall execute any documents which any such Prior Lien holder may require to effectuate the provisions of this Section 26. As a condition of any such subordination, however, the holder of or beneficiary under any such encumbrance shall agree in an executed, acknowledged and recorded non-disturbance agreement which provides that Tenant shall not be disturbed in its possession, except as may be consequent on an Event of Default, nor shall the obligations of Tenant be enlarged or its rights abridged hereunder by reason of any such mortgage or deed of trust or lease, save and except that the lender and any person acquiring title by reason of a foreclosure sale or an exercise of a power of sale or by deed expressly in lieu of foreclosure shall not: (i) have any liability for any act, omission, default or breach by Landlord under this Lease occurring prior to the time of such acquisition by such lender or person (provided such act, omission, default or breach does not constitute a continuing default that survives any such acquisition); (ii) be subject to any claim or offset which Tenant may have had against Landlord; (iii) be bound by any payment of rent or any part thereof more than one month in advance; (iv) be bound by any amendment or modification to this Lease made after such subordination and without the written consent of such lender; (v) be obligated for the return of any security deposit or other thing of value given to Landlord to secure the performance by Tenant of its obligations under this Lease or any one or more of such obligations, except to the extent actually received from or credited by Landlord; (vi) be required to perform, or liable for the failure to perform, the obligations of Landlord with respect to construction of improvements; and (vii) be obligated to perform any repair or restoration of the Project or the Premises required as a result of any damage, destruction or condemnation, except to the extent that insurance proceeds or condemnation awards received by such lender or person are sufficient to fully pay the cost of such repair or restoration. The foregoing provisions of this Section 26 to the contrary notwithstanding, concurrently with Landlord’s execution of this Lease, Landlord shall, with respect to each existing Prior Lien holder, provide Tenant with a non-disturbance agreement which provides that Tenant shall not be disturbed in its possession, except as may be consequent on an Event of Default, nor shall the obligations of Tenant be enlarged or its rights abridged hereunder by reason of any such mortgage or deed of trust or lease, save and except that the lender and any person acquiring title by reason of a foreclosure sale or an exercise of a power of sale or by deed expressly in lieu of foreclosure shall not: (i) have any liability for any act, omission, default or breach by Landlord under this Lease occurring prior to the time of such acquisition by such lender or person; (ii) be subject to any claim or offset which Tenant may have had against Landlord (provided such act, omission, default or breach does not constitute a continuing default that survives any such acquisition); (iii) be bound by any payment of rent or any part thereof more than one month in advance; (iv) be bound by any amendment or modification to this Lease made after such subordination and without the written consent of such lender; (v) be obligated for the return of any security deposit or other thing of value given to Landlord to secure the performance by Tenant of its obligations under this Lease or any one or more of such obligations; (vi) be required to perform, or liable for the failure to perform, the obligations of Landlord with respect to construction of improvements; and, (vii) be obligated to
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perform any repair or restoration of the Project or the Premises required as a result of any damage, destruction or condemnation, except to the extent that insurance proceeds or condemnation awards received by such lender or person are sufficient to fully pay the cost of such repair or restoration.
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(i) The failure by Tenant to make any payment of Basic Rent, additional rent, other charges or any other payment required to be made by Tenant hereunder, as and when due, where such failure shall continue for a period of ten (10) days after written notice thereof from Landlord to Tenant; provided, however, that any such notice shall be in lieu of, and not in addition to, any notice required under California Code of Civil Procedure § 1161 regarding unlawful detainer actions.
(ii) The failure by Tenant to observe or perform any of the express or implied covenants or provisions of this Lease to be observed or performed by Tenant, other than as specified in Section 30(a)(i) above, where such failure shall continue for a period of thirty (30) days after written notice thereof from Landlord to Tenant. Any such notice shall be in lieu of, and not in addition to, any notice required under California Code of Civil Procedure § 1161 regarding unlawful detainer actions. If the nature of Tenant’s default (other than a default specified in Section 30(a)(i) above) is such that more than thirty (30) days are reasonably required for its cure, then Tenant shall not be deemed to be in default if Tenant shall commence such cure within said thirty (30) day period and thereafter diligently prosecute such cure to completion, and such completion shall occur not later than ninety (90) days from the date of such notice from Landlord.
(iii) Any of the following: The making by Tenant of any general assignment for the benefit of creditors; the filing by or against Tenant of a petition to have Tenant adjudged a bankrupt or a petition for reorganization or arrangement under any law relating to bankruptcy (unless, in the case of a petition filed against Tenant, the same is dismissed within thirty (30) days); the appointment of a trustee or receiver to take possession of substantially all of Tenant’s assets located at the Premises or of Tenant’s interest in this Lease, where possession is not restored to Tenant within thirty (30) days; or the attachment, execution or other judicial seizure of substantially all of Tenant’s assets located at the Premises or of Tenant’s interest in this Lease where such seizure is not discharged within thirty (30) days.
(iv) Any other act or omission which is expressly provided in this Lease to be an Event of Default, as to which acts or events the notice provisions of Section 30(a)(ii) shall not be applicable.
(i) The right to terminate this Lease and pursue its rights and remedies provided by California Civil Code Section 1951.2, in which event Landlord may recover:
(A) The worth at the time of award of any unpaid rent which had been earned at the time of such termination; plus
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(B) The worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of award exceeds the amount of such rental loss that Tenant proves could have been reasonably avoided; plus
(C) The worth at the time of award of the amount by which the unpaid rent for the balance of the Term after the time of award exceeds the amount of such rental loss that Tenant proves could have been reasonably avoided; plus
(D) Any other amount necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which in the ordinary course of things would be likely to result therefrom, specifically including, but not limited to, brokerage commissions and advertising expenses incurred, expenses of remodeling the Premises or any portion thereof for a new tenant, whether for the same or a different use, and any special concessions made to obtain a new tenant; plus
(E) At Landlord’s election, such other amounts in addition to or in lieu of the foregoing as may be permitted from time to time by applicable law.
(ii) The term “rent” as used hereinabove shall be deemed to be and to mean all sums of every nature required to be paid by Tenant pursuant to the terms of this Lease, whether to Landlord or to others. As used in Sections 30(b)(i)(A) and 30(b)(i)(B), the “worth at the time of award” shall be computed by allowing interest at a rate equal to the “prime,” “reference” or “index” rate of Xxxxx Fargo Bank NA (or, if Xxxxx Fargo Bank NA no longer publishes such a rate, then at the rate published by the largest commercial bank headquartered in California publishing such a rate) plus six hundred (600) basis points, but in no case greater than the maximum amount of such interest permitted by law. As used in Section 30(b)(i)(C), the “worth at the time of award” shall be computed by discounting such amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of award plus one percent (1%);
(iii) The rights and remedies provided by California Civil Code Section 1951.4, that allow Landlord to continue this Lease in effect and to enforce all of its rights and remedies under this Lease, including the right to recover Basic Rent, additional rent and other charges as they become due, for so long as Landlord does not terminate Tenant’s right to possession. Acts of maintenance or preservation, efforts to relet the Premises or the appointment of a receiver upon Landlord’s initiative to protect its interest under this Lease shall not constitute a termination of Tenant’s right to possession;
(iv) The right to enter the Premises and remove therefrom all persons and property, store such property in a public warehouse or elsewhere at the cost of and for the account of Tenant, and sell such property and apply the proceeds therefrom pursuant to applicable California law; and
(v) The right to take steps necessary or appropriate to have a receiver appointed for Tenant in order to take possession of the Premises and apply any rental collected and exercise all other rights and remedies granted to Landlord.
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32. TIME. Time is of the essence of each and every provision of this Lease.
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To Landlord: | San Xxxxxx Land Company, LLC |
0000 Xxxxxx Xxxx., Xxxxx 000 |
Xxx Xxxxxx, Xxxxxxxxxx 00000 |
Attention: Xxxxx X. Xxxxx |
Telephone No.: (000) 000-0000 |
Facsimile No.: (000) 000-0000 |
With a copy to: | Xx. Xxxxxxx X. Xxxxxxx |
San Xxxxxx Land Company, LLC |
000 Xxxx Xxxx Xxxxxx, Xxxxx 0000 |
Xxxxxxx, Xxxxx 00000-0000 |
Telephone No.: (000) 000-0000 Ext 1804 |
Facsimile No.: (000) 000-0000 |
To Tenant: | Managed Health Network, Inc. |
c/o Health Net, Inc. |
Xxxx Xxxxxx Xxx 0000 |
Xxxxxx Xxxxxxx, Xxxxxxxxxx 00000-0000 |
Attention: Director of Real Estate |
Telephone No.: (000) 000-0000 |
Facsimile No.: (000) 000-0000 |
For overnight couriers only: |
c/o Health Net, Inc. |
00000 Xxxxxxxxxx Xxxxx |
Xxxxxx Xxxxxxx, Xxxxxxxxxx 00000 |
Attention: Director of Real Estate |
Telephone No.: (000) 000-0000 |
Facsimile No.: (000) 000-0000 |
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Any such notices shall be sent by (i) U.S. certified mail, postage prepaid, return receipt requested, in which case notice shall be deemed delivered three (3) business days after timely deposit in the mail, (ii) a nationally recognized overnight courier, in which case notice shall be deemed delivered one (1) business day after timely deposit with such courier; (iii) personally delivered, in which case notice shall be deemed delivered upon receipt, or (iv) electronic communication, whether by telex, telegram, electronic mail or facsimile, in which case notice shall be deemed delivered on the date of machine-generated confirmed receipt if a copy of such notice is also sent by overnight courier on the same day.
37. WAIVER OF RIGHT TO JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICABLE LAW, LANDLORD AND TENANT WAIVE THEIR RESPECTIVE RIGHTS TO TRIAL BY JURY OF ANY CONTRACT OR TORT CLAIM, COUNTERCLAIM, CROSS-COMPLAINT, OR CAUSE OF ACTION IN ANY ACTION, PROCEEDING, OR HEARING BROUGHT BY EITHER PARTY AGAINST THE OTHER ON ANY MATTER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS LEASE, THE RELATIONSHIP OF LANDLORD AND TENANT, OR TENANT’S USE OR OCCUPANCY OF THE PREMISES, INCLUDING WITHOUT LIMITATION ANY CLAIM OF INJURY OR DAMAGE OR THE ENFORCEMENT OF ANY REMEDY UNDER ANY CURRENT OR FUTURE LAW, STATUTE, REGULATION, CODE, OR ORDINANCE. Landlord and Tenant agree that this paragraph constitutes a written consent to waiver of trial by jury within the meaning of California Code of Civil Procedure Section 631(d)(2), and Tenant does hereby authorize and empower Landlord to file this paragraph and/or this Lease, as required, with the clerk or judge of any court of competent jurisdiction as a written consent to waiver of jury trial. If the waiver set forth in this Section 631 (d)(2) is determined by any court to be invalid because it was executed prior to the commencement of any action, then Landlord and Tenant each covenant and agree to execute and deliver to the other, within five (5) days of a written request by the other, a waiver of the right to trial by jury similar in terms and scope to the waiver set forth in this Section 33 at such time following the commencement of such action as such waiver, if then made, would be valid.
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under the supervision of an attorney, and the costs and fees incurred in connection with the enforcement or collection of any judgment obtained in any such proceeding, and shall include, specifically, all fees, costs and expenses of expert witnesses. For purposes of this Section 38, the term “prevailing party” shall include a prevailing party as defined in California Code of Civil Procedure Section 998.
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belonging to Landlord or any other person, are granted to Tenant by this Lease. If at any time any windows of the Premises are temporarily darkened or the light or view therefrom is obstructed by reason of any repairs, improvements, maintenance or cleaning in or about the Project, the same shall be without liability to Landlord and without any reduction or diminution of Tenant’s obligations under this Lease, provided Landlord makes commercially reasonable efforts to limit the extent and duration of any such darkening or obstruction.
(c) Exercise of Right of First Offer. Tenant may lease such Offering Space in its entirety only, under such terms, by delivering written notice of exercise to Landlord (the “Notice of Exercise”) within five (5) business days of the date Tenant receives the Advice, except that Tenant shall have no such Right of First Offer and Landlord need not provide Tenant with an Advice, if: (i) an Event of Default exists at the time that Landlord would otherwise deliver the Advice; (ii) more than twenty-five percent (25%) of the Premises is sublet (other than to an Affiliate or Successor) at the time Landlord would otherwise deliver the Advice; (iii) Tenant is not occupying the Premises on the date Landlord would otherwise deliver the Advice; or (iv) such Offering Space is not intended for the exclusive use of Tenant during the Term. Notwithstanding the foregoing, if (x) Tenant was entitled to exercise its Right of First Offer, but failed to provide Landlord with a Notice of Exercise within the five (5) business day period provided above; and (y) Landlord does not enter into a lease for the Offering Space with a third-
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party within a period of six (6) months following the date of the Advice with a rental rate equal to at least ninety-five percent (95%) of the basic rent set forth in the Advice, Tenant shall once again have a Right of First Offer with respect to such Offering Space; provided, however, that if Landlord enters into a lease for the Offering Space following Tenant’s failure to provide Landlord with a Notice of Exercise within the five (5) business day period provided above, and such lease is entered into following such six (6) month period or with a rental rate less than ninety-five percent (95%) of the basic rent set forth in the Advice, any rights or options to extend or renew the term of such lease granted by Landlord to such third-party shall be superior to Tenant’s renewed Right of First Offer.
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(i) Landlord hereby warrants and represents to Tenant that Landlord has not voluntarily incurred, on its behalf or on behalf of Tenant or on behalf of both Landlord and Tenant, any obligation to pay a commission or finder’s fee to any real estate broker or other person or entity in connection with this Lease, other than Tenant’s broker identified on the Basic Lease Information (“Tenant’s Broker”) and Orion Partners Ltd. (“Landlord’s Broker”), with which Landlord has a separate agreement with respect to the payment of a commission in connection with this transaction. Landlord hereby agrees to indemnify, defend and hold Tenant harmless from claims for any commission or finder’s fee charges by any real estate broker or other person or entity (including, without limitation, Tenant’s Broker, but only to the extent that the claim of Tenant’s Broker is based upon the separate agreement between Landlord and Tenant’s Broker or Orion Partners Ltd.) arising from an agreement, whether express or implied, between Landlord and such broker or other person or entity or otherwise arising from the conduct of Landlord. In no event shall Landlord’s separate agreement with Landlord’s Broker or Tenant’s Broker bind Tenant with regard to any future brokerage agreements Tenant may enter into regarding this Lease or prevent any such future broker(s) as Tenant may retain from obtaining a commission with regard to such future Lease transactions.
(ii) Tenant hereby warrants and represents to Landlord that Tenant has not voluntarily incurred, on its behalf or on behalf of Landlord or on behalf of both Landlord and Tenant, any obligation to pay a commission or finder’s fee to any real estate broker or other person or entity in connection with this Lease, other than Tenant’s Broker. Tenant is not aware of any obligation of Landlord to Tenant’s Broker other than those set forth in the separate agreement between Landlord and Tenant’s Broker or Orion Partners Ltd. Tenant hereby agrees to indemnify, defend and hold Landlord harmless from claims for any commission or finder’s fee charges by any real estate broker or other person or entity arising from an agreement, whether express or implied, between Tenant and such broker or other person or entity or otherwise arising from the conduct of Tenant.
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(l) Examination of Lease. Submission of this instrument for examination or signature by Tenant does not constitute a reservation of or option to lease, and it is not effective as a lease or otherwise until execution by and delivery to both Landlord and Tenant.
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(t) Project or Building Name and Signage. Landlord shall have the right at any time to change the name of the Building or Project and to install, affix and maintain any and all signs on the exterior and on the interior of the Project or Building as Landlord may, in Landlord’s sole discretion, desire. Tenant shall not use the name of the Project or the Building or use pictures or illustrations of the Project or the Building in advertising or other publicity, without the prior written consent of Landlord.
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IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the date first above written.
TENANT: | Managed Health Network, Inc., a Delaware corporation | |||||||
By: | /s/ Xxxxxx Xxxx | |||||||
Name: | Xxxxxx Xxxx | |||||||
Title: | Vice President Real Estate Management | |||||||
LANDLORD: | San Xxxxxx Land Company, LLC, | |||||||
a California limited liability company | ||||||||
By: | /s/ Xxxxxxx X. Xxxxxxx | |||||||
Name: | Xxxxxxx X. Xxxxxxx | |||||||
Title: | Manager |
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