LEASE
THIS LEASE (this "LEASE") is made as of September 22, 1997 by and between
"LANDLORD" Xxxxxxx Properties, L.P., a California limited partnership
and
"TENANT" Integrated Measurement Systems, Inc., an Oregon corporation
SECTION A: TABLE OF CONTENTS
SECTION 1: DEFINITIONS ...........................1
SECTION 2: PREMISES AND TERM .....................4
2.1 Lease of Premises ............................4
2.2 Lease Term and Expansions ....................4
2.3 Tenant Improvements ..........................6
2.4 Memorandum of Commencement Date ..............7
2.5 Use and Conduct of Business ..................7
2.6 Compliance with Governmental Requirements
and Rules and Regulations ....................7
SECTION 3: BASE RENT, ADDITIONAL RENT,
ADDITIONAL TENANT IMPROVEMENT RENT, ...............7
3.1 Payment of Rental ............................7
3.2 Base Rent ....................................7
3.3 Security Deposit .............................8
3.4 Additional Rent ..............................8
3.5 Additional Tenant Improvement Rent ..........11
3.6 Utilities ...................................11
3.7 Holdover ....................................11
3.8 Late Charge .................................11
3.9 Default Rate ................................11
SECTION 4: GENERAL PROVISIONS ...................11
4.1 Maintenance and Repair by Landlord ..........11
4.2 Maintenance and Repair by Tenant ............12
4.3 Common Areas/Security .......................12
4.4 Tenant Alterations ..........................12
4.5 Tenant's Work Performance ...................13
4.6 Surrender of Possession .....................13
4.7 Removal of Property .........................13
4.8 Access ......................................13
4.9 Damage or Destruction .......................14
4.10 Condemnation ................................15
4.11 Parking .....................................15
4.12 Indemnification .............................16
4.13 Tenant Insurance ............................16
4.14 Landlord's Insurance ........................16
4.15 Waiver of Subrogation .......................17
4.16 Assignment and Subletting by Tenant .........17
4.17 Assignment by Landlord ......................19
4.18 Estoppel Certificates .......................19
4.19 Modification for Lender .....................19
4.20 Hazardous Substances ........................19
4.21 Access Laws .................................20
4.22 Quiet Enjoyment .............................20
4.23 Signs .......................................20
4.24 Subordination ...............................21
4.25 Workers Compensation Immunity ...............21
4.26 Brokers .....................................21
4.27 Exculpation and Limitation of Liability .....21
4.28 Intentionally Deleted .......................21
4.29 Mechanic's Liens and Tenant's Personal
Property Taxes ..............................22
SECTION 5: DEFAULT AND REMEDIES .................22
5.1 Events of Default ...........................22
5.2 Remedies ....................................22
5.3 Right to Perform ............................24
5.4 Landlord's Default ..........................24
SECTION 6: MISCELLANEOUS PROVISIONS .............24
6.1 Notices .....................................24
6.2 Attorney's Fees and Expenses ................24
6.3 No Accord and Satisfaction ..................24
6.4 Successors; Joint and Several Liability .....24
6.5 Choice of Law ...............................25
6.6 No Waiver of Remedies .......................25
6.7 Offer to Lease ..............................25
6.8 Force Majeure ...............................25
6.9 Landlord's Consent ..........................25
6.10 Severability; Captions ......................25
6.11 Interpretation ..............................25
6.12 Incorporation of Prior Agreement;
Amendments ..................................26
6.13 Authority ...................................26
6.14 Time of Essence .............................26
6.15 Survival of Obligations .....................26
6.16 Consent to Service ..........................26
6.17 Landlord's Authorized Agents ................26
6.18 Waiver of Jury Trial ........................26
6.19 Counterparts; Facsimile Signatures ..........26
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LISTING OF EXHIBITS
Exhibit A Legal Description of the Land
Exhibit B Drawing Showing Location of the Existing Space
Exhibit C [Intentionally Omitted]
Exhibit D Form of Memorandum of Commencement Date
Exhibit E Rules and Regulations
Exhibit F Description of Permitted Exterior Signs
Exhibit G Drawing Showing Location of BIT Space
Exhibit H Drawing Showing Location of Magni Space
Exhibit I Drawing Showing Location of NCD Space
Exhibit J Drawing Showing Location of Stream Space
Exhibit K Drawing Showing Location of Center
Exhibit L Work Agreement
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SECTION 1: DEFINITIONS
1.1 DEFINITIONS. Each underlined term in this section shall have the
meaning set forth next to that underlined term.
1.2 ACCESS LAWS: The Americans With Disabilities Act of 1990
(including the Americans with Disabilities Act Accessibility
Guidelines for Building and Facilities) and all other Governmental
Requirements relating to the foregoing.
1.3 ADDITIONAL RENT: Defined in paragraph captioned "ADDITIONAL RENT".
1.4 ADDITIONAL TENANT IMPROVEMENT RENT: Defined in paragraph captioned
"ADDITIONAL TENANT IMPROVEMENT RENT".
1.5 BASE AMOUNT: Defined in paragraph captioned "ADDITIONAL RENT".
1.6 BASE RENT: Base Rent shall be as follows:
A. For the Magni Space:
January 1, 1998 through December 31, 2001 - $12,087.00 per month
January 1, 2002 through February 29, 2004 - $13,352.00 per month
B. For the Existing Space:
January 1, 1999 through December 31, 2001 - $64,390.00 per month
January 1, 2002 through February 29, 2004 - $71,130.00 per month
C. For the BIT Space (if and when leased):
June 1, 1999 through December 31, 2001 - $7,310.00 per month
January 1, 2002 through February 29, 2004 - $8,075.00 per month
D. For the NCD Space (if and when leased):
January 1, 2001 through December 31, 2001 - $25,711.42 per
month; provided that, Base Rent for the NCD Space for such
period shall be reduced to $17,111.42 per month if and so long
as there is no Event of Default under this Lease. Upon the
occurrence of any Event of Default, such Base Rent shall
immediately increase to $25,711.42 per month and one half of
the differential between the full monthly Base Rent and the
reduced Base Rent for all previous months shall be immediately
due and payable.
January 1, 2002 through February 29, 2004 - $28,402.15 per month
E. For the Stream Space, the amount designated as Base Rent in
Landlord's right of first refusal notice regarding the Stream
Space, as more particularly described in the subparagraph
entitled "RIGHT OF FIRST REFUSAL FOR STREAM SPACE".
1.7 BIT SPACE: The portion of Building 5 depicted on the plan attached
to this Lease as EXHIBIT G.
1.8 BROKERS: Tenant was represented in this transaction by Xxxx Xxxxx
Tenant Counsel, a licensed real estate organization. Landlord was
represented in this transaction by Xxxxxxxx Xxxx NW, Inc., a
licensed real estate organization.
1.9 BUILDING 2: That certain building located on the Land at 0000 XX
Xxxxxx Xxxxx, Xxxxxxxxx, Xxxxxx 00000, commonly known as "Building
2" of the Center. Building 2 contains approximately 35,258
rentable square feet.
1.10 BUILDING 3: That certain building located on the Land at 0000 XX
Xxxxxx Xxxxx, Xxxxxxxxx, Xxxxxx 00000, commonly known as "Building
3" of the Center. Building 3 contains approximately 39,614
rentable square feet.
1.11 BUILDING 4: That certain building located on the Land at 0000 XX
Xxxxxx Xxxxx, Xxxxxxxxx, Xxxxxx 00000, commonly known as "Building
4" of the Center. Building 4 contains approximately 43,952
rentable square feet.
1.12 BUILDING 5: That certain building located on the Land at 0000 XX
Xxxxxx Xxxxx, Xxxxxxxxx, Xxxxxx 00000, commonly known as "Building
5" of the Center. Building 5 contains approximately 30,898
rentable square feet.
1.13 BUILDINGS: An individual and collective reference to Xxxxxxxx 0,
Xxxxxxxx 0, Xxxxxxxx 0 and Building 5 if, as and when Tenant leases
any portion thereof pursuant to this Lease.
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1.14 BUSINESS DAY: Calendar days, except for Saturdays and Sundays and
holidays when banks are closed in the greater Portland, Oregon area.
1.15 CADENCE: Cadence Design Systems, Inc., a Delaware corporation.
1.16 CENTER: The Nimbus Technology Park, Phases I, II, and III,
containing 10 buildings (including the Buildings), located in
Xxxxxxxxx, Xxxxxx 00000, and depicted on EXHIBIT K attached to this
Lease.
1.17 CLAIMS: An individual and collective reference to any and all
claims, demands, damages, injuries, losses, liens, liabilities,
penalties, fines, lawsuits, actions, other proceedings and expenses
(including attorneys' fees and expenses incurred in connection with
the proceeding whether at trial or on appeal).
1.18 COMMENCEMENT DATE: The Commencement Date of this Lease shall be as
follows:
A. As to the Magni Space - January 1, 1998
B. As to the Existing Space - January 1, 1999
C. As to the BIT Space, if such space is leased pursuant to the
terms and conditions of this Lease, the Commencement Date
shall be June 1, 1999.
D. As to the NCD Space, if such space is leased pursuant to the
terms and conditions of this Lease, the Commencement Date
shall be January 1, 2001.
E. As to the Stream Space, the Commencement Date shall be the
date Tenant first leases such space from Landlord pursuant to
the terms and conditions of the right of first refusal for
such space described in this Lease.
F. As to the space described in subparagraph 2.2.4, the
Commencement Date shall be the date Tenant first leases such
space from Landlord pursuant to the terms and conditions of
the right of first offer for such space described in this
Lease.
Notwithstanding anything in this paragraph to the contrary,
as to the Magni Space, the BIT Space and the NCD Space, the
Commencement Date for each such space shall be no earlier
than 60 days after the date that Landlord notifies Tenant
that the tenant in possession of such space has vacated and
removed all of its possessions from such space.
1.19 ERISA: The Employee Retirement Income Security Act of 1974, as now
or hereafter amended, and the regulations promulgated under it.
1.20 ESTIMATED OPERATING COSTS ALLOCABLE TO THE PREMISES: Defined in
paragraph captioned "ADDITIONAL RENT".
1.21 EXISTING LEASE: That certain lease in effect as of the date of
this Lease between Tenant (as Tenant) and Landlord, as successor to
Beaverton-Xxxxxxx Tech Properties (as Landlord), dated August 31,
1989, as amended on December 13, 1990 and November 16, 1993,
pursuant to which Tenant is leasing the Existing Space from
Landlord.
1.22 EXISTING SPACE: Those portions of Building 2 and Building 3
depicted on the plan attached to this Lease as EXHIBIT B. As of
the date of this Lease, Tenant is leasing the Existing Space from
Landlord pursuant to the Existing Lease.
1.23 EVENTS OF DEFAULT: One or more of those events or states of facts
defined in the paragraph captioned "EVENTS OF DEFAULT".
1.24 FAIR MARKET RENTAL RATE: The fair market rental rate established
pursuant to subparagraph captioned "FAIR MARKET RENTAL RATE".
1.25 GOVERNMENTAL AGENCY: The United States of America, the state in
which the Land is located, any county, city, district, municipality
or other governmental subdivision, court or agency or
quasi-governmental agency having jurisdiction over the Land and any
board, agency or authority associated with any such governmental
entity, including the fire department having jurisdiction over the
Land.
1.26 GOVERNMENTAL REQUIREMENTS: Any and all statutes, ordinances,
codes, laws, rules, regulations, orders and directives of any
Governmental Agency as now or later amended.
1.27 HAZARDOUS SUBSTANCE(S): Asbestos, PCBs, petroleum or
petroleum-based chemicals or substances, urea formaldehyde or any
chemical, material, element, compound, solution, mixture, substance
or other matter of any kind whatsoever which is now or later
defined, classified, listed, designated or regulated as hazardous,
toxic or radioactive by any Governmental Agency.
1.28 LAND: The land located in Washington County, State of Oregon, City
of Beaverton, as legally described in EXHIBIT A attached to this
Lease. Such land includes all real property upon which the Center
is located.
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1.29 LANDLORD: Xxxxxxx Properties, L.P., a California limited
partnership, or its successors and assigns as provided in paragraph
captioned "ASSIGNMENT BY LANDLORD".
1.30 LANDLORD'S AGENTS: Any and all venturers, partners, officers,
agents, employees, trustees, investment advisors and consultants of
Landlord.
1.31 LEASE TERM: as to all of the Premises except the Stream Space and
the space described in subparagraph 2.2.4, the Lease Term shall
commence on the Commencement Date, and end February 29, 2004. As
to the Stream Space, the Lease Term shall commence on the
Commencement Date, and end on the date set forth as the termination
date in Landlord's notice triggering Tenant's right of first
refusal for the Stream Space. As to the space described in
subparagraph 2.2.4, the Lease Term shall commence on the
Commencement Date, and end on the date set forth as the termination
date in Landlord's notice triggering Tenant's right of first offer
for such space.
1.32 MAGNI SPACE: The portion of Building 4 depicted on the plan
attached to this Lease as EXHIBIT H.
1.33 MANAGER: Xxxxxxx Properties, L.P., or its replacement as specified
by written notice from Landlord to Tenant.
1.34 MANAGER'S ADDRESS: 0000 XX Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxx,
Xxxxxx 00000, which address may be changed by written notice from
Landlord to Tenant.
1.35 NCD SPACE: The portion of Building 4 depicted on the plan attached
to this Lease as EXHIBIT I.
1.36 OPERATING COSTS: Defined in paragraph captioned "ADDITIONAL RENT".
1.37 OPERATING COSTS ALLOCABLE TO THE PREMISES: Defined in paragraph
captioned "ADDITIONAL RENT".
1.38 PERMITTED USE: Design, light assembly and repair of software and
electronic equipment, so long as such use is consistent with
first-class buildings of the same or similar use as the Buildings
and located in the metropolitan area in which the Buildings are
located.
1.39 PREPAID RENT: $0.00.
1.40 PREMISES: This term includes the Magni Space and the Existing
Space, and may in the future include the BIT Space, the NCD Space,
the Stream Space and any other space if, as and when any such space
is leased by Landlord to Tenant subject to the terms and conditions
of this Lease.
1.41 PRIME RATE: Defined in paragraph captioned "DEFAULT RATE".
1.42 PROPERTY TAXES: (a) Any form of ad valorem real or personal
property tax or assessment imposed by any Governmental Agency on
the Land, Center or any personal property owned by Landlord
associated with the Center or Land; (b) any other form of tax or
assessment, license fee, license tax, tax or excise on rent or any
other levy, charge, expense or imposition made or required by any
Governmental Agency on any interest of Landlord in the Center or
Land; (c) any fee for services charged by any Governmental Agency
for any services such as fire protection, street, sidewalk and road
maintenance, refuse collection, school systems or other services
provided or formerly provided to property owners and residents
within the general area of the Land; (d) any governmental
impositions allocable to or measured by the area of any or all of
the Center or Land or the amount of any base rent, additional rent
or other sums payable under any lease for any or all of the Land,
including any tax on gross receipts or any excise tax or other
charges levied by any Governmental Agency with respect to the
possession, leasing, operation, maintenance, alteration, repair,
use or occupancy of any or all of the Land or Center or the rent
earned by any part of or interest in the Center or Land; (e) any
impositions by any Governmental Agency on any transaction evidenced
by a lease of any or all of the Center or Land or charge with
respect to any document to which Landlord is a party creating or
transferring an interest or an estate in any or all of the Center
or Land; and (f) any increase in any of the foregoing based upon
construction of improvements or change of ownership of any or all
of the Land. Property Taxes shall not include taxes on Landlord's
net income or any inheritance, estate or gift taxes.
1.43 SECURITY DEPOSIT: As of the date of execution of this Lease, the
Security Deposit shall be Seventy-six thousand, four hundred and
seventy-seven dollars ($76,477.00) (the "INITIAL SECURITY
DEPOSIT"). At such time as total monthly Base Rent for all spaces
being leased by Tenant pursuant to this Lease exceeds the Initial
Security Deposit, and at all times thereafter, the Security Deposit
required shall be the dollar amount that is equal to the combined
monthly Base Rent for all space being leased by Tenant pursuant to
this Lease, as that amount may change from time to time; except
that the Security Deposit payable with respect to the BIT Space and
the NCD Space shall equal one-half (50%) of the monthly Base Rent
payable for the BIT Space and the NCD Space as provided in Section
1.6.
1.44 STREAM SPACE: The portion of Building 5 depicted on the plan
attached to this Lease as EXHIBIT J.
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1.45 TENANT: The entity named on the first page of this Lease.
1.46 TENANT ALTERATIONS: Defined in paragraph captioned "TENANT
ALTERATIONS".
1.47 TENANT IMPROVEMENT ALLOWANCE: The maximum amount to be expended by
Landlord, if any, for the cost of Tenant Improvements (including
architectural, engineering, permitting and space planning fees),
which maximum shall not exceed:
A. As to the Magni Space: $140,550.00
B. As to the Existing Space: $675,000.00
C. As to the BIT Space (if and when leased): $62,000.00
D. As to the NCD Space (if and when leased): $149,485.00
E. As to the Stream Space: the amount, if any, designated as
Tenant Improvement Allowance in Landlord's right of first
refusal notice regarding the Stream Space, as more
particularly described in the subparagraph entitled "RIGHT OF
FIRST REFUSAL FOR STREAM SPACE".
F. As to the space described in subparagraph 2.2.4: the amount,
if any, designated as Tenant Improvement Allowance in
Landlord's notice regarding lease terms and conditions, as
more particularly described in subparagraph 2.2.4.
Any applicable Tenant Improvement Allowance shall be disbursed and
expended subject to the terms and conditions of a Work Agreement
attached as EXHIBIT L to this Lease.
1.48 TENANT IMPROVEMENTS: Those alterations or improvements to the
Premises to be constructed pursuant to the terms and conditions of
a Work Agreement attached as EXHIBIT L to this Lease.
1.49 TENANT'S AGENTS: Any and all officers, contractors,
subcontractors, licensees, agents, concessionaires, subtenants,
servants, employees, customers, guests, invitees or visitors of
Tenant.
1.50 TENANT'S PRO RATA SHARE: The sum of the percentages set forth
opposite each of the spaces listed below, if, as and when any such
space is leased by Tenant from Landlord pursuant to the terms and
conditions of this Lease:
A. Magni Space: 3.11%
B. Existing Space: 16.56%
C. BIT Space: 1.88%
D. NCD Space: 6.61%
E. Stream Space: 4.95%
Tenant's Pro Rata Share shall at all times be determined with
reference to the actual space in the Center being leased by Tenant
from Landlord from time to time pursuant to this Lease, and will
change from time to time based on changes in the quantity of space
so leased.
1.51 YEAR: A calendar year commencing January 1 and ending December 31
during the Lease Term, or the portion of such calendar year within
the Lease Term.
SECTION 2: PREMISES AND TERM
2.1 LEASE OF PREMISES. Landlord leases the Premises to Tenant, and
Tenant leases the Premises from Landlord, upon the terms and conditions set
forth in this Lease.
2.2 LEASE TERM AND EXPANSIONS.
2.2.1 INITIAL TERM. The initial Lease Term shall be for the period
stated in the definition of Lease Term, unless earlier terminated as provided
in this Lease.
2.2.2 EXPANSION OPTIONS FOR BIT AND NCD SPACES. Subject to the terms
and conditions set forth in this subparagraph, Tenant shall have a one-time
option to lease the BIT Space and a one-time option to lease the NCD Space. In
order to exercise either or both of such options, Tenant must satisfy all of the
following requirements, each of which is a condition precedent to Tenant's
ability to exercise each of such options: (a) Tenant shall provide Landlord
with written notice of Tenant's intention to exercise the option to expand,
which notice must be received by Landlord no later than October 1, 1998, as to
the BIT Space, and no later than March 1, 2000, as to the NCD Space; (b) on the
date that Tenant notifies Landlord of Tenant's intention to exercise the option
and on the Commencement Date applicable respectively to the BIT Space and the
NCD space, there shall be no Event of Default by Tenant under this Lease and
there shall have occurred no act or omission which, with the passage of time or
the giving of notice, or
4
both, would become an Event of Default by Tenant under this Lease; (c) at no
point in time prior to the applicable Commencement Date shall any one or more
assignees or subtenants of Tenant have been in possession of, in the aggregate,
more than 15,000 square feet of the Premises, or have been in possession of any
portion of the Premises pursuant to an assignment or sublease with a term
(including exercised extensions) exceeding twenty-four (24) months (except that
an assignment or sublease of up to 6,000 square feet of the Premises to Cadence,
or as permitted pursuant to the terms of paragraph 4.16.7, shall not be counted
toward the 15,000 square foot maximum or the 24-month term limitation). If
Tenant exercises its option to lease the BIT Space or the NCD Space, it shall
lease the applicable space under the terms of this Lease, shall pay the
applicable Base Rent, and shall be entitled to the applicable Tenant Improvement
Allowance. If Tenant exercises its option to lease the BIT Space, the
Commencement Date for the lease of such space shall be June 1, 1999. If Tenant
exercises its option to lease the NCD Space, the Commencement Date for the lease
of such space shall be January 1, 2001.
2.2.3 RIGHT OF FIRST REFUSAL FOR STREAM SPACE. Subject to the terms and
conditions set forth in this subparagraph, Tenant shall have a one-time right of
first refusal to lease the Stream Space. In order to exercise such right of
first refusal, Tenant must satisfy all of the following requirements, each of
which is a condition precedent to Tenant's ability to exercise such right of
first refusal: (a) as of the date that Landlord provides Tenant with the notice
triggering the right of first refusal, and as of the Commencement Date
applicable to the Stream Space, there shall be no Event of Default by Tenant
under this Lease and there shall have occurred no act or omission which, with
the passage of time or the giving of notice, or both, would become an Event of
Default by Tenant under this Lease; and (b) at no point in time prior to the
Commencement Date applicable to the Stream Space shall any one or more assignees
or subtenants of Tenant have been in possession of, in the aggregate, more than
15,000 square feet of the Premises, or have been in possession of any portion of
the Premises pursuant to an assignment or sublease with a term (including
exercised extensions) exceeding twenty-four (24) months (except that an
assignment or sublease of up to 6,000 square feet of the Premises to Cadence, or
as permitted pursuant to the terms of paragraph 4.16.7, shall not be counted
toward the 15,000 square foot maximum or the 24-month term limitation). If
Landlord receives a bona fide offer to lease the Stream Space, Landlord shall
notify Tenant in writing of the terms of such offer, including the commencement
date, base rent, tenant improvements, and other basic business terms. Tenant
shall have five (5) Business Days from receipt of such notice to exercise its
right of first refusal. If Tenant exercises its right of first refusal to lease
the Stream Space, it shall thereafter lease the Stream Space under the terms of
this Lease (as supplemented by the terms set forth in Landlord's notice
triggering the right of first refusal). If Tenant does not exercise its right
of first refusal within the time allotted, Landlord may lease the Stream Space
pursuant to the bona fide offer, and Tenant shall thereafter have no rights with
regard to the Stream Space.
2.2.4 RIGHT OF FIRST OFFER FOR AVAILABLE SPACE. Subject to the terms and
conditions set forth in this subparagraph, and if Tenant has not exercised its
right of first refusal regarding the Stream Space, if any space in the Center
(between 10,000 and 25,000 square feet in size) becomes available for lease
during the last eighteen (18) months of the initial Lease Term (not including
any extension term), Landlord shall provide Tenant with written notice thereof,
which notice will set forth the terms and conditions under which Landlord will
be willing to lease such space to Tenant (including commencement date, base
rent, and tenant improvements). Tenant shall have thirty (30) calendar days
from receipt of such notice to exercise its right of first offer to lease the
available space on the terms and conditions set forth in the triggering notice.
If Tenant exercises its right of first offer to lease said available space, it
shall thereafter lease such space under the terms of this Lease (as supplemented
by the terms set forth in the Landlord's notice triggering the right of first
offer), and Tenant shall have no further such right of first offer as to any
other space in the Center. If Tenant does not exercise its right of first offer
within the time allotted, Landlord may lease such space to any party on any
terms it chooses, and Tenant shall thereafter have no rights with regard to any
other space in the Center. In order to remain entitled to such right of first
offer notification, Tenant must satisfy all of the following requirements, each
of which is a condition precedent to Tenant's entitlement to notification: (a)
as of the date that any such space becomes available, there shall be no Event of
Default by Tenant under this Lease and there shall have occurred no act or
omission which, with the passage of time or the giving of notice, or both, would
become an Event of Default by Tenant under this Lease; and (b) at no point in
time prior to the date any such space shall become available shall any one or
more assignees or subtenants of Tenant have been in posession of, in the
aggregate, more than 15,000 square feet of the Premises, or have been in
possession of any portion of the Premises pursuant to an assignment or sublease
with a term (including exercised extensions) exceeding twenty-four (24) months
(except that an assignment or sublease of up to 6,000 square feet of the
Premises to Cadence, or as permitted pursuant to the terms of paragraph 4.16.7,
shall not be counted toward the 15,000 square foot maximum or the 24-month term
limitation). Notwithstanding anything in this subparagraph, if Landlord
provides the notice which triggers Tenant's right of first refusal for the
Stream Space as described in subparagraph 2.2.3, and Tenant does not timely
exercise its right of refusal for such space, Tenant shall not thereafter have
any rights to the space described in this subparagraph or any rights with
respect to any other space in the Center.
2.2.5 EXTENSION TERM. Subject to the terms and conditions set forth in
this paragraph, Tenant shall have a one-time option to extend the Lease Term as
to all, but not less than all, of the then-existing Premises, for a period of
five (5) years, commencing on March 1, 2004 and expiring on February 28, 2009;
PROVIDED THAT, (a) if the expiration date
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of this Lease with respect to those Premises leased pursuant to subparagraph
2.2.3 or 2.2.4 is on or after March 1, 2004, the effect of any such extension
with respect to such Premises shall be to extend the expiration date to
February 28, 2009, and (b) in no event shall Tenant have the option of
extending the term of this Lease with respect to Premises leased pursuant to
subparagraph 2.2.3 or 2.2.4 under circumstances where the expiration date of
this Lease with respect to such Premises is on or after February 28, 2009.
In order to exercise its option to extend, Tenant must satisfy all of the
following requirements, each of which is a condition precedent to Tenant's
ability to exercise such option to extend: (c) Tenant shall provide Landlord
with written notice of Tenant's intention to exercise the option to extend,
which notice must be received by Landlord no earlier than January 1, 2003 and
no later than April 30, 2003; (d) as of the date that Tenant notifies
Landlord of Tenant's intention to exercise the option and as of the
expiration of the original Lease Term, there shall be no Event of Default by
Tenant under this Lease and there shall have occurred no act or omission
which, with the passage of time or the giving of notice, or both, would
become an Event of Default by Tenant under this Lease; and (e) at no point in
time prior to the expiration of the original Lease Term shall any one or more
assignees or subtenants of Tenant have been in possession of, in the
aggregate, more than 15,000 square feet of the Premises, or have been in
possession of any portion of the Premises pursuant to an assignment or
sublease with a term (including exercised extensions) exceeding twenty-four
(24) months (except that an assignment or sublease of up to 6,000 square feet
of the Premises to Cadence, or as permitted pursuant to the terms of
paragraph 4.16.7, shall not be counted toward the 15,000 square foot maximum
or the 24-month term limitation). In the event the Lease Term is extended as
provided in this paragraph, such extension shall be on the same terms,
covenants and conditions as set forth in this Lease; PROVIDED THAT, the
monthly Base Rent during the extension period shall equal the greater of (i)
the Fair Market Rental Rate, established as of the commencement of the
extension period, or (ii) the monthly Base Rent in effect as of the
expiration of the original Lease Term.
2.2.6 FAIR MARKET RENTAL RATE. The Fair Market Rental Rate for the
extension term shall be determined under then-prevailing market conditions for
leased premises which are comparable to the applicable Premises based on size,
condition, tenant improvements and location, and which are made available for a
term equal to the extension period. If the parties cannot agree on the Fair
Market Rental Rate within thirty (30) days of receipt by Landlord of the notice
of intent to exercise the option to extend, Landlord shall, no more than ten
(10) Business Days thereafter, select an independent M.A.I. (certified in the
State of Oregon) real estate appraiser with at least five (5) years experience
in the Xxxxxxx 000 xxxx of the Beaverton, Oregon real estate market, who shall
prepare a written appraisal of the Fair Market Rental Rate using the assumptions
described in this paragraph. The appraisal report shall be completed and
delivered to Tenant and Landlord within thirty (30) days from the date Landlord
selects the appraiser. Such appraiser's determination of Fair Market Rental
Rate shall be determinative unless Tenant disputes it as provided in the next
sentence. If Tenant disputes such appraisal, Tenant shall within ten (10)
Business Days following delivery of the appraisal report, deliver to Landlord
notice (a) that Tenant disputes such appraisal report, and (b) of the identity
of the appraiser selected by Tenant meeting the qualifications set forth in this
paragraph. The appraiser selected by Tenant shall submit his appraisal report
of the Fair Market Rental Rate using the assumptions described in this paragraph
within thirty (30) days following the delivery of Tenant's notice to Landlord
disputing the initial appraisal. If the two appraisals are within three percent
(3%) of each other (based on the higher number), the Fair Market Rental Rate
shall be that set forth in the appraisal report of Landlord's appraiser. If
not, then within five (5) days after the delivery of the second appraisal, the
two appraisers shall appoint a third appraiser meeting the qualifications set
forth in this paragraph, and the third appraiser shall deliver his decision
within ten (10) days following his selection and acceptance of the appraisal
assignment. The third appraiser shall be limited in authority to selecting, in
his opinion, which of the two earlier appraisal determinations best reflects the
Fair Market Rental Rate under the assumptions set forth in this paragraph. The
third appraiser must choose one of the two earlier appraisals, and, upon doing
so, the third appraiser's determination shall be the controlling determination
of the Fair Market Rental Rate. Each party shall pay the costs and fees of the
appraiser it selected; if a third appraiser is selected, the party whose
appraisal is not selected to be the Fair Market Rental Rate by said third
appraiser shall pay all of said third appraiser's costs and fees.
2.3 TENANT IMPROVEMENTS. Landlord shall use the Tenant Improvement
Allowance for the design and construction of the applicable Tenant
Improvements pursuant to a Work Agreement in the form attached to this Lease
as EXHIBIT L. The Tenant Improvement Allowance for the Existing Space may be
partially or fully utilized by Tenant prior to the Commencement Date
applicable to the Existing Space. All amounts previously expended by Tenant
on the Existing Space, but not previously reimbursed to Tenant, shall be
reimbursed (as part of the Tenant Improvement Allowance for the Existing
Space) to Tenant within thirty (30) days after the full execution of this
Lease, so long as the disbursement and other requirements of the Work
Agreement attached as EXHIBIT L are satisfied. To the extent that the Tenant
Improvement Allowance applicable to the Existing Space is not entirely
utilized for Tenant Improvements to the Existing Space, all of such amount
may be applied, at Tenant's option (with notice by Tenant to Landlord), to
the Tenant Improvement Allowance for the Magni Space, BIT Space, NCD Space,
Stream Space, or the space described in subparagraph 2.2.4. If Tenant hires
Interface Engineering to perform investigations regarding mechanical and
electrical design specifications regarding Tenant Improvements, Tenant shall
be entitled to a one-time credit of up to $10,000.00 of the actual
out-of-pocket costs thereof against the Tenant Improvement Allowance of
Tenant's choice (provided Tenant is otherwise entitled to said Tenant
Improvement
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Allowance under this Lease). In addition, if Tenant hires a communications
consultant to investigate viable telecommunications cabling alternatives for
the Premises, Tenant shall be entitled to a one-time credit of up to
$10,000.00 of the actual out-of-pocket cost thereof against the Tenant
Improvement Allowance of Tenant's choice (provided Tenant is otherwise
entitled to said Tenant Improvement Allowance under this Lease). Out of the
Tenant Improvement Allowance applicable to the Existing Space, Tenant shall
be entitled to utilize up to $1.00 per square foot of Existing Space for
general and furniture relocation expenses incurred by Tenant in connection
with its occupation of the Existing Space. Out of the Tenant Improvement
Allowance applicable to the Magni Space, Tenant shall be entitled to utilize
up to $1.00 per square foot of Magni Space for general and furniture
relocation expenses incurred by Tenant in connection with its occupation of
the Magni Space. If Tenant leases the BIT Space, then out of the Tenant
Improvement Allowance applicable to the BIT Space, Tenant shall be entitled
to utilize up to $1.00 per square foot of the BIT Space for general and
furniture relocation expenses incurred by Tenant in connection with its
occupation of the BIT Space. If Tenant leases the NCD Space, then out of the
Tenant Improvement Allowance applicable to the NCD Space, Tenant shall be
entitled to utilize up to $1.00 per square foot of the NCD Space for general
and furniture relocation expenses incurred by Tenant in connection with its
occupation of the NCD Space.
2.4 MEMORANDUM OF COMMENCEMENT DATE. At either party's election and
request, Landlord and Tenant shall execute a Memorandum of Commencement Date,
for any one or more of the applicable Commencement Dates, in the form
attached as EXHIBIT D. In no event shall Tenant record this Lease or any
Memorandum of Commencement Date.
2.5 USE AND CONDUCT OF BUSINESS. The Premises are to be used only for
the Permitted Uses, and for no other business or purpose without the prior
consent of Landlord. Landlord makes no representation or warranty as to the
suitability of the Premises for Tenant's intended use. Tenant shall, at its
own cost and expense, obtain and maintain any and all licenses, permits, and
approvals necessary or appropriate for its use, occupation and operation of
the Premises. Tenant's inability to obtain or maintain any such license,
permit or approval necessary or appropriate for its use, occupation or
operation of the Premises shall not relieve it of its obligations under this
Lease, including the obligation to pay Base Rent and Additional Rent. No act
shall be done in or about the Premises that is unlawful. In addition, no act
shall be done in or about the Premises that will increase the existing rate
of insurance on any or all of the Land or Buildings (unless Tenant agrees to
pay for such increase and to assume liability for any increased deductible
for such increased coverage). Tenant shall not commit or allow to be
committed or exist: (a) any waste upon the Premises, (b) any public or
private nuisance, or (c) any act or condition which disturbs the quiet
enjoyment of any other tenant in the Buildings, violate any of Landlord's
contracts affecting any or all of the Land or Buildings, create or contribute
to any work stoppage, strike, picketing, labor disruption or dispute,
interfere in any way with the business of Landlord or any other tenant in the
Buildings or with the rights or privileges of any contractors,
subcontractors, licensees, agents, concessionaires, subtenants, servants,
employees, customers, guests, invitees or visitors or any other persons
lawfully in and upon the Land or Buildings. Tenant shall not, without the
prior consent of Landlord, use any apparatus, machinery or device in or about
the Premises which will cause any substantial noise or vibration or any
substantial increase in the normal consumption level of electric power.
If any of Tenant's machines and equipment should disturb the quiet enjoyment
of any other tenant in the Buildings, then Tenant shall provide, at its sole
cost and expense, adequate insulation or take such other action, including
removing such machines and equipment, as may be reasonably necessary to fully
mitigate the disturbance.
2.6 COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS AND RULES AND REGULATIONS.
Tenant shall comply with all Governmental Requirements relating to its use,
occupancy and operation of the Premises and shall observe such reasonable rules
and regulations as may be adopted and published by Landlord from time to time
for the safety, care and cleanliness of the Premises and the Buildings, and for
the preservation of good order in the Buildings, including the Rules and
Regulations attached to this Lease as EXHIBIT E, so long as such Rules and
Regulations are enforced with reasonable consistency by Landlord so as not to be
inequitable as enforced against Tenant.
SECTION 3: BASE RENT, ADDITIONAL RENT, ADDITIONAL TENANT IMPROVEMENT RENT,
AND OTHER SUMS PAYABLE UNDER LEASE
3.1 PAYMENT OF RENTAL. Tenant agrees to pay Base Rent, Additional
Rent, Additional Tenant Improvement Rent, and any other sum due under this
Lease to Landlord without demand, deduction, credit, adjustment or offset of
any kind or nature, in lawful money of the United States when due under this
Lease, at the offices of Manager at Manager's Address, or to such other party
or at such other place as Landlord may from time to time designate in writing.
3.2 BASE RENT. Tenant agrees to pay Base Rent to Landlord without
demand, in advance on or before the first day of each calendar month of the
Lease Term. Base Rent for any partial month at the beginning or end of the
Lease Term shall be prorated. On execution of this Lease, Tenant has paid to
Landlord the
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amount specified in the definition of Prepaid Rent for the month specified in
the definition of that term. Base Rent for any partial month at the
beginning of the Lease Term shall be paid by Tenant on the Commencement Date.
3.3 SECURITY DEPOSIT. As security for the full and faithful payment of
all sums due under this Lease and the full and faithful performance of every
covenant and condition of this Lease to be performed by Tenant, Tenant agrees
to pay to Landlord upon execution of this Lease the sum specified as the
Initial Security Deposit in the paragraph containing the definition of the
term Security Deposit, and shall thereafter pay to Landlord from time to
time, upon demand by Landlord, such additional amounts as are necessary to
ensure that Landlord has in its possession the full amount of the Security
Deposit at all times during the Lease Term. If Tenant shall breach or
default with respect to any payment obligation or other covenant or condition
of this Lease, Landlord may apply all or any part of the Security Deposit to
the payment of any sum in default or any damage suffered by Landlord as a
result of such breach or default, and in such event, Tenant shall, upon
demand by Landlord, deposit with Landlord the amount so applied so that
Landlord shall have the full Security Deposit on hand at all times during the
Lease Term. Landlord's use or application of all or any portion of the
Security Deposit shall not impair any other rights or remedies provided under
this Lease or under applicable law and shall not be construed as a payment of
liquidated damages. If Tenant shall have fully complied with all of the
covenants and conditions of this Lease, the Security Deposit shall be repaid
to Tenant, without interest, within ten (10) Business Days after the
expiration of this Lease. Tenant may not mortgage, assign, transfer or
encumber the Security Deposit and any such act on the part of Tenant shall be
without force or effect. In the event any bankruptcy, insolvency,
reorganization or other creditor-debtor proceedings shall be instituted by or
against Tenant, the Security Deposit shall be deemed to be applied first to
the payment of Base Rent, Additional Rent and all other sums payable under
this Lease to Landlord for all periods prior to the institution of such
proceedings and the balance, if any, may be retained by Landlord and applied
against Landlord's damages.
3.4 ADDITIONAL RENT. Definitions of certain terms used in this
paragraph are set forth in subparagraph 3.4.5. Tenant agrees to pay to
Landlord Additional Rent as computed in this paragraph (individually and
collectively the "ADDITIONAL RENT"):
3.4.1 RENTAL ADJUSTMENT FOR ESTIMATED OPERATING COSTS. Landlord shall
furnish Tenant a written statement of Estimated Operating Costs Allocable to the
Premises for each Year and the amount payable monthly by Tenant for such Costs
shall be computed as follows: one-twelfth (1/12) of the amount, if any, by
which the Estimated Operating Costs Allocable to the Premises exceeds the Base
Amount shall be Additional Rent and shall be paid monthly by Tenant for each
month during such Year after the Commencement Date. If the Commencement Date
occurs on a date other than the first day of the Year, the statement provided by
Landlord to Tenant and the computation of the monthly payment amount shall be
determined based on a proration of the excess amount over a 365-day year. If
such written statement (except the first statement, which shall be prorated
pursuant to the previous sentence) is furnished after the commencement of the
Year, Tenant shall also make a retroactive lump-sum payment equal to the amount
of the monthly payment amount multiplied by the number of months during the Year
after the Commencement Date for which no payment was made.
3.4.2 ACTUAL COSTS. After the close of each Year, Landlord shall deliver
to Tenant a written statement setting forth the Operating Costs Allocable to the
Premises during the preceding Year. Subject to the terms of paragraph 3.4.3, if
such costs for any Year exceed the Estimated Operating Costs Allocable to the
Premises paid by Tenant to Landlord pursuant to subparagraph 3.4.1 for such
Year, Tenant shall pay the amount of such excess to Landlord within twenty (20)
Business Days after receipt of such statement by Tenant, and if such statement
shows the Operating Costs Allocable to the Premises to be less than the
Estimated Operating Costs Allocable to the Premises paid by Tenant to Landlord
pursuant to subparagraph 3.4.1, then the amount of such overpayment shall be
paid by Landlord to Tenant within twenty (20) Business Days following the date
of such statement or, at Landlord's option, shall be credited towards the
installment(s) of Additional Rent next coming due from Tenant.
3.4.3 DETERMINATION. Subject to Tenant's right to audit as set forth
below, the determination of Operating Costs Allocable to the Premises shall be
made by Landlord. Any sums payable under this Lease pursuant to this paragraph
shall be Additional Rent and, in the event of nonpayment of such sums, Landlord
shall have the same rights and remedies with respect to such nonpayment as it
has with respect to nonpayment of the Base Rent due under this Lease. If Tenant
disputes the amount of Operating Costs Allocable to the Premises as determined
by Landlord, Tenant shall within twenty (20) Business Days following receipt by
Tenant of the written statement of Operating Costs Allocable to the Premises,
deliver to Landlord notice (a) that Tenant disputes the amount of such costs and
specifying the items disputed, and (b) of the identity of an outside cost
auditor selected by Tenant, who shall be a certified public accountant not
retained on a contingency fee basis who is licensed to practice in the state of
Oregon, with at least five (5) years' cost-auditing experience of a type and
nature similar to that required pursuant to this subparagraph. Tenant's cost
auditor shall have reasonable access to the books, records and accounts utilized
by Landlord in determining Operating Costs Allocable to the Premises for a
period of twenty (20) Business Days following receipt by Landlord of Tenant's
dispute notice. Tenant's cost auditor shall submit his or her written cost
audit report (which must be prepared according to generally accepted accounting
principles, consistently applied) to Landlord within sixty (60) days following
the delivery of Tenant's dispute notice to Landlord. If Landlord accepts the
report of
8
Tenant's cost auditor, (i) the amount set forth therein shall be the
Operating Costs Allocable to the Premises for the preceding Year, and the
provisions of paragraph 3.4.2 (dealing with the reconciliation of such amount
and the Estimated Operating Costs Allocable to the Premises for such Year)
shall otherwise apply, and (ii) if the cost audit report discloses a
discrepancy which resulted in an overstatement of the Operating Costs
Allocable to the Premises by more than five percent (5%), Landlord shall
reimburse Tenant for Tenant's reasonable out of pocket costs of Tenant's cost
auditor (not to exceed the amount of the overstatement). If Landlord does
not accept the report of Tenant's cost auditor, Landlord may, at its option,
either notify Tenant within five (5) days of its intent to submit the issue
of determining Operating Costs Allocable to the Premises to the additional
cost auditor on the schedule and terms set forth below (in which case the
additional cost auditor will be limited to choosing between the report of
Tenant's cost auditor and Landlord's initial determination), or, if no such
notice is given Tenant, deliver to Tenant a redetermination of Operating
Costs Allocable to the Premises prepared by Landlord or Landlord's cost
auditor (the "REDETERMINATION REPORT") within thirty (30) Business Days after
receipt of the report of Tenant's cost auditor. If Tenant does not accept
the Redetermination Report within ten (10) days, Landlord or Landlord's cost
auditor and Tenant's cost auditor shall, within fifteen (15) days after
delivery of the Redetermination Report, appoint an additional cost auditor
(meeting the qualifications set forth in this paragraph), and the additional
cost auditor shall deliver his or her decision within ten (10) days following
his or her selection and acceptance of the auditing assignment. The
additional cost auditor shall be limited in authority to selecting, in his or
her opinion, which of the two earlier determinations (the report of Tenant's
cost auditor or the Redetermination Report) best reflects the Operating Costs
Allocable to the Premises under the terms of this Lease. The additional cost
auditor must choose one of the two earlier determinations, and, upon doing
so, the additional cost auditor's determination shall be the controlling
determination of the Operating Costs Allocable to the Premises. Except as
set forth above, each party shall pay the costs and fees of its cost auditor;
if an additional cost auditor is selected, the party whose determination is
not selected to be the Operating Costs Allocable to the Premises by said
additional cost auditor shall pay all of said additional cost auditor's costs
and fees. Until a final determination of the Operating Costs Allocable to the
Premises has been made pursuant to this paragraph, Landlord's initial
determination of Operating Costs Allocable to the Premises shall be binding
and in effect, and the terms of paragraph 3.4.2 shall apply.
3.4.4 END OF TERM. If this Lease shall terminate on a day other than the
last day of a Year, the amount of any adjustment between Estimated Operating
Costs Allocable to the Premises and Operating Costs Allocable to the Premises
with respect to the Year in which such termination occurs shall be prorated on
the basis which the number of days from the commencement of such Year (to and
including such termination date) bears to 365; and any amount payable by
Landlord to Tenant or Tenant to Landlord with respect to such adjustment shall
be payable within twenty (20) Business Days after delivery of the statement of
Operating Costs Allocable to the Premises with respect to such Year. Landlord's
and Tenant's obligations under this paragraph shall survive the expiration or
other termination of this Lease.
3.4.5 DEFINITIONS. Each underlined term in this subparagraph shall have
the meaning set forth next to that underlined term:
BASE AMOUNT: Zero.
ESTIMATED OPERATING COSTS ALLOCABLE TO THE PREMISES: Landlord's
estimate of Operating Costs allocable to the Premises for a Year to be
given by Landlord to Tenant pursuant to subparagraph 3.4.1.
OPERATING COSTS: All expenses paid or incurred by Landlord for
maintaining, operating, owning and repairing the Center and the personal
property used in conjunction with such maintenance, operation, ownership
and repair, including all expenses paid or incurred by Landlord (subject
to the specific exclusions listed in this paragraph) for: (a)
utilities, including electricity, water, gas, sewers, refuse collection,
telephone charges, cable television or other electronic or microwave
signal reception, steam, heat, cooling or any other service which is now
or in the future considered a utility and which are not payable directly
by tenants in the Center; (b) supplies; (c) cleaning and janitorial
services (including window washing), landscaping and landscaping
maintenance (including irrigating, trimming, moving, fertilizing,
seeding and replacing plants), snow removal and other services; (d)
security services, if any; (e) insurance; (f) management fees; (g)
Property Taxes, tax consultant fees and expenses, and costs of appeals
of any Property Taxes; (h) services of independent contractors; (i)
compensation (including employment taxes and fringe benefits) of all
persons who perform duties in connection with any service, repair,
maintenance, replacement or improvement or other work included in this
subparagraph; (j) license, permit and inspection fees; (k) assessments
and special assessments due to deed restrictions, declarations or owners
associations or other means of allocating costs of a larger tract of
which the Land is a part; (l) rental of any machinery or equipment; (m)
audit fees and accounting services related to the Center, and charges
for the computation of the rents and charges payable by tenants in the
Center (but only to the extent the cost of such fees and services are in
addition to the cost of the management fee); (n) the cost of
improvements, repairs or replacements; (o) maintenance and service
contracts; (p) legal fees and other expenses of legal or other dispute
resolution proceedings; (q) maintenance and repair of the roof and roof
membranes, (r) costs incurred by Landlord for compliance with Access
Laws, as set forth in the paragraph entitled "ACCESS
9
LAWS"; (s) elevator service and repair, if any; and (t) any other
expense or charge which in accordance with generally accepted accounting
and management principles would be considered an expense of maintaining,
operating, owning or repairing the Center. Without limiting the
foregoing, Operating Costs shall include replacement of roofs and roof
membranes; exterior painting; parking area resurfacing, resealing and
restriping parking areas and driveways; upgrading of the HVAC systems in
the Center, and other capital improvements which are intended to reduce
Operating Costs; PROVIDED THAT, such capital improvements, whether
installed before or after the Commencement Date, shall be amortized with
market interest over their estimated useful lives as determined by
Landlord and only the amortization installments and interest
attributable to the Lease Term shall be an Operating Cost under this
Lease.
Operating Costs shall not include any of the following:
(1) ground rent;
(2) interest and amortization of funds borrowed by Landlord for
items other than capital improvements;
(3) leasing commissions and advertising and space planning
expenses incurred in procuring tenants;
(4) salaries, wages, or other compensation paid to officers or
executives of Landlord in their capacities as officers and
executives;
(5) rentals for items (except when needed in connection with
normal repairs and maintenance of permanent systems) which, if
purchased, rather than rented, would constitute a capital
improvement (excluding, however, equipment not affixed to the
Buildings which is used in providing janitorial, security, or
similar services);
(6) costs incurred by Landlord for the repair of damage to the
Center, to the extent that Landlord is reimbursed by insurance
proceeds;
(7) costs, including permit, license and inspection costs,
incurred with respect to the installation of tenant
improvements made for tenants or other occupants in the Center
or incurred in renovating or otherwise improving, decorating,
painting or redecorating vacant space for tenants or other
occupants of the Center;
(8) attorney's fees incurred in connection with the negotiation
and preparation of letters, deal memos, letters of intent,
leases, subleases and/or assignments;
(9) expenses in connection with services or other benefits which
are not offered to Tenant or for which Tenant is charged for
directly but which are provided to another Tenant or occupant
of the Center the cost of which is included as Operating Costs;
(10) overhead and profit increment paid to Landlord or to
subsidiaries or affiliates of Landlord for goods and/or
services in the Center to the extent the same exceeds the
costs of such goods and/or services rendered by unaffiliated
third parties on a competitive basis;
(11) interest, principal, points and fees on debts or amortization
on any mortgage or mortgages or any other debt instrument
encumbering the Center;
(12) Landlord's general corporate overhead and general and
administrative expenses;
(13) electric power costs for which any tenant directly contracts
with the local public service company;
(14) tax penalties incurred as a result of Landlord's negligence,
inability or unwillingness to make payments and/or to file any
income tax or information returns when due;
(15) costs arising from the presence of Hazardous Substances in the
common areas in or about the Center, including, without
limitation, Hazardous Substances in the ground water or soil,
PROVIDED, that nothing in this subparagraph shall relieve
Tenant from its obligations regarding Hazardous Substances as
set forth in paragraph 4.20, and PROVIDED FURTHER THAT,
nothing in this subparagraph shall be deemed to exclude
ordinary cleaning, maintenance and janitorial expenses from
Operating Costs;
(16) costs arising from Landlord's charitable or political
contributions;
(17) costs for sculpture, painting, or other subjects of art;
(18) except where such costs benefit the Center or a Building as a
whole, costs (including in connection therewith all attorneys'
fees and costs of settlement, judgments and payments in lieu
thereof) arising from claims or disputes in connection with
potential or actual claims, litigations or arbitrations
pertaining to the Landlord and/or the Center;
(19) costs incurred by Landlord due to the default by Landlord or
any tenant of the terms and conditions of any lease of space
in the Center; and
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(20) subject to paragraph 4.12, costs arising from the negligence
or fault of Landlord or its agents, or any vendors,
contractors, or providers of materials or services selected,
hired or engaged by Landlord or its agents.
If less than one hundred percent (100%) of the net rentable area of the
Center is occupied by tenants at all times during any Year, then
Operating Costs for such Year shall include all additional costs and
expenses that Landlord reasonably determines would have been incurred
had one hundred percent (100%) of the Center been occupied at all times
during such Year by tenants.
OPERATING COSTS ALLOCABLE TO THE PREMISES: The product of Tenant's Pro
Rata Share times Operating Costs.
3.5 ADDITIONAL TENANT IMPROVEMENT RENT. Provided that (a) there shall
be no Event of Default by Tenant under this Lease, (b) there shall have
occurred no act or omission which, with the passage of time or the giving of
notice, or both, would become an Event of Default by Tenant under this Lease,
and (c) at no point in time shall any one or more assignees or subtenants of
Tenant have been in possession of, in the aggregate, more than 15,000 square
feet of the Premises, or have been in possession of any portion of the
Premises pursuant to an assignment or sublease with a term (including
exercised extensions) exceeding twenty-four (24) months (except that an
assignment or sublease of up to 6,000 square feet of the Premises to Cadence,
or as permitted pursuant to the terms of paragraph 4.16.7, shall not be
counted toward the 15,000 square foot maximum or the 24-month term
limitation), Landlord shall make available to Tenant upon Tenant's written
request an additional Tenant Improvement allowance equal to $2.50 per leased
square foot, to be used at any time during the initial Lease Term to
construct Tenant Improvements pursuant to one or more Work Agreements in the
form attached as EXHIBIT L. If, as and when Landlord expends any such
additional Tenant Improvement allowance, the cost thereof shall be amortized
over the remaining initial Lease Term (not including any extension term) at
an amortization rate equal to two and one-half (2.5) percentage points in
excess of the then-current prime rate of U.S. Bank (or its successor), and
shall be paid by Tenant to Landlord as Additional Tenant Improvement Rent.
Additional Tenant Improvement Rent shall be paid in equal monthly
installments on the first (1st) day of each calendar month remaining in the
initial Lease Term.
3.6 UTILITIES. Tenant shall contract directly and pay for all water,
gas, heat, light, power, telephone, sewer, sprinkler charges and other
utilities used on or from the Premises together with any taxes, penalties,
surcharges or similar charges relating to such utilities. If any such
service is not separately metered to the Premises, the cost therefor shall be
an Operating Cost under this Lease. Tenant shall have the right to apply for
and receive any energy rebates or credits as a result of improvements to
utility delivery systems, such as use of fluorescent lights, HVAC
economizers, and the like.
3.7 HOLDOVER. If Tenant shall, with the prior consent of Landlord,
hold over after the expiration or termination of the Lease Term, Tenant shall
be deemed to be occupying the Premises under a month-to-month tenancy, which
tenancy may be terminated as provided by the laws of the state in which the
Premises are located. During such tenancy, Tenant agrees to pay to Landlord
120% of the rate of Base Rent in effect on the expiration or termination of
the Lease Term, plus all Additional Rent and other sums payable under this
Lease, and to be bound by all of the other covenants and conditions specified
in this Lease, so far as applicable. The preceding provisions shall not be
construed as consent for Tenant to hold over.
3.8 LATE CHARGE. If Tenant fails to make any payment of Base Rent,
Additional Rent, Additional Tenant Improvement Rent, or other amount within
five (5) Business Days of the date due under this Lease, Tenant shall also
pay a late charge equal to two and one-half percent (2.5%) of the amount of
any such payment. Landlord and Tenant agree that this charge compensates
Landlord for the administrative costs caused by the delinquency. The parties
agree that Landlord's damage would be difficult to compute and the amount
stated in this paragraph represents a reasonable estimate of such damage.
Assessment or payment of the late charge contemplated in this paragraph shall
not excuse or cure any Event of Default or breach by Tenant under this Lease
or impair any other right or remedy provided under this Lease or under law.
3.9 DEFAULT RATE. Any Base Rent, Additional Rent, Additional Tenant
Improvement Rent, or other sum payable under this Lease which is not paid
when due shall bear interest at a rate equal to the published prime rate of
Xxxxx Bank N.A., or such other national banking institution designated by
Landlord if such bank ceases to publish a prime rate (the "PRIME RATE"), then
in effect, plus four (4) percentage points (the "DEFAULT RATE"), but the
payment of such interest shall not excuse or cure any Event of Default or
breach by Tenant under this Lease or impair any other right or remedy
provided under this Lease or under law.
SECTION 4: GENERAL PROVISIONS
4.1 MAINTENANCE AND REPAIR BY LANDLORD. Subject to the paragraphs
captioned "DAMAGE OR DESTRUCTION" and "CONDEMNATION", Landlord shall maintain
the public and common areas of the Buildings and the Center, including the
storm drainage system, in an order and condition consistent with first-class
buildings of the same or similar use as the Buildings and the Center and
located in the metropolitan area in
11
which the Center is located, except for damage occasioned by the act or
omission of Tenant or Tenant's Agents which shall be paid for entirely by
Tenant upon demand by Landlord, and ordinary wear and tear. In the event any
or all of the Buildings or Center becomes in need of maintenance or repair
which Landlord is required to make under this Lease, Tenant shall immediately
give written notice to Landlord, and Landlord shall promptly commence and
diligently pursue to completion all such maintenance or repair after
Landlord's receipt of such notice; provided that, Landlord shall make
commercially reasonable efforts to cause the repair of HVAC systems as
expeditiously as reasonably possible.
4.2 MAINTENANCE AND REPAIR BY TENANT. Except as is expressly set forth
as Landlord's responsibility pursuant to the paragraph captioned "MAINTENANCE
AND REPAIR BY LANDLORD," Tenant shall at Tenant's sole cost and expense keep
and maintain the Premises in good condition and repair, including HVAC
systems (as limited below), interior painting, cleaning of the interior side
of all exterior glass, plumbing and utility fixtures and installations,
carpets and floor coverings, all interior wall surfaces and coverings
including tile and paneling, replacement of all broken windows (including
without limitation any exterior windows), exterior and interior doors, roof
penetrations and membranes in connection with any Tenant installations on the
roof including satellite dishes, light bulb replacement and interior
preventative maintenance. If Tenant fails to maintain or repair the Premises
in accordance with this paragraph, then Landlord may, but shall not be
required to, enter the Premises, accompanied by Tenant's agent if desired by
Tenant, upon two (2) Business Days prior written notice (which shall include
the approximate scheduled time of entry) to Tenant (or immediately without
any notice in the case of an emergency) to perform such maintenance or repair
at Tenant's sole cost and expense. Tenant shall pay to Landlord the cost of
such maintenance or repair within thirty (30) days of written demand from
Landlord. Provided Tenant otherwise maintains the HVAC systems in good
condition and repair as required by this Lease, Landlord shall be responsible
for all costs of repair and replacement thereof to the extent the same
exceeds $0.085, per leased square foot of the Premises, in any calendar year;
PROVIDED, that (a) any costs so expended by Landlord shall be Operating Costs
for the Center, and (b) if Tenant upgrades the HVAC systems, any maintenance
and repair costs attributable to any such upgrade shall not count towards
determining costs in excess of $0.085 per leased square foot of the Premises.
4.3 COMMON AREAS/SECURITY. The common areas of the Center shall be
subject to Landlord's sole management and control. Without limiting the
generality of the immediately preceding sentence, Landlord reserves the
exclusive right as it deems necessary or desirable to install, construct,
remove, maintain and operate lighting systems, facilities, improvements,
equipment and signs on, in or to all parts of the common areas; change the
number, size, height, layout, or locations of walks, driveways and truckways
or parking areas now or later forming a part of the Land or Center; make
alterations or additions to the Center or common areas; close temporarily all
or any portion of the common areas to make repairs, changes or to avoid
public dedication; grant easements to which the Land will be subject, replat,
subdivide, or make other changes to the Land; place, relocate and operate
utility lines through, over or under the Land and Center; and use or permit
the use of all or any portion of the roofs of the Buildings. Landlord has no
duty or obligation to provide any security services in, on or around the
Premises, Land or Center, and Tenant recognizes that security services, if
any, provided by Landlord will be for the sole benefit of Landlord and the
protection of Landlord's property and under no circumstances shall Landlord
be responsible for, and Tenant waives any rights with respect to, Landlord
providing security or other protection for Tenant or Tenant's Agents or
property in, on or about the Premises, Land or Center. Tenant shall have the
nonexclusive right to access and use the common areas of the Buildings and
the Center during the term of and subject to the applicable provisions of
this Lease. Landlord reserves the right to reallocate parking and driveway
locations and to build additional improvements in the common areas so long as
Tenant's access to the Premises and parking privileges as described in this
Lease are not materially adversely impacted.
4.4 TENANT ALTERATIONS. Tenant shall not make any alterations,
additions or improvements in or to the Premises, or make changes to locks on
doors, or add, disturb or in any way change any floor covering, wall
covering, fixtures, plumbing or wiring (individually and collectively "TENANT
ALTERATIONS"), without first obtaining the consent of Landlord. For
non-structural Tenant Alterations expected to cost less than $100,000.00
(including materials, labor, and tax), Landlord may not unreasonably withhold
or delay its consent; as to all other Tenant Alterations, Landlord's consent
shall be subject to the terms of paragraph 6.9. Tenant shall deliver to
Landlord full and complete plans and specifications for any proposed Tenant
Alterations and, if consent by Landlord is given, all such work shall be
performed at Tenant's expense by Landlord or by Tenant at Landlord's
election. Without limiting the generality of the foregoing, Landlord may
require Tenant (if Landlord has elected to require Tenant to perform the
Tenant Alterations), at Tenant's sole cost and expense, to obtain and provide
Landlord with proof of insurance coverage and a payment and performance bond,
in forms, amounts and by companies acceptable to Landlord. All Tenant
Alterations to the Premises, regardless of which party constructed them,
shall become the property of Landlord and shall remain upon and be
surrendered with the Premises upon the expiration or earlier termination of
this Lease, unless Landlord's consent to such Tenant Alterations is
conditioned upon Tenant removing the Tenant Alterations upon the expiration
or earlier termination of this Lease. If Tenant fails to remove any such
Tenant Alterations as required by Landlord's consent, Landlord may do so and
Tenant shall pay the entire cost thereof to Landlord within ten (10) Business
Days after Tenant's receipt of Landlord's written demand therefor. Tenant
shall
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reimburse Landlord, upon receipt of demand therefor with invoices, for all
out-of-pocket costs and expenses incurred by Landlord during its review of
Tenant's plans and specifications (regardless of whether Landlord approves
Tenant's request) and Tenant's construction. Nothing contained in this
paragraph or the paragraph captioned "TENANT'S WORK PERFORMANCE" shall be
deemed a waiver of the provisions of the paragraph captioned "MECHANIC'S
LIENS AND TENANT'S PERSONAL PROPERTY TAXES".
4.5 TENANT'S WORK PERFORMANCE. If Landlord elects to require Tenant to
perform the Tenant Alterations, then the Tenant Alterations shall be
performed by contractors employed by Tenant under one or more construction
contracts, in form and content approved in advance in writing by Landlord
(which approval shall be subject to Landlord's discretion). Tenant's
contractors, workers and suppliers shall work in harmony with and not
interfere with workers or contractors of Landlord or other tenants of
Landlord. If Tenant's contractors, workers or suppliers do, in the opinion of
Landlord, cause such disharmony or interference, Landlord's consent to the
continuation of such work may be withdrawn upon written notice to Tenant.
All Tenant Alterations shall be (1) completed in accordance with the plans
and specifications approved by Landlord; (2) completed in accordance with all
Governmental Requirements; (3) carried out promptly in a good and workmanlike
manner; (4) of all new materials or other materials approved in advance by
Landlord; and (5) free of defect in materials and workmanship. With respect
to this paragraph 4.5, Tenant shall pay for all damage to the Premises,
Buildings, Center, and Land caused by Tenant or Tenant's Agents, and Tenant
shall indemnify, defend and hold harmless Landlord and Landlord's Agents from
any Claims arising as a result of any defect in design, material or
workmanship of any Tenant Alterations.
4.6 SURRENDER OF POSSESSION. Subject to the last subparagraph of the
paragraph captioned "INSURANCE", Tenant shall, at the expiration or earlier
termination of this Lease, surrender and deliver the Premises to Landlord in
as good condition as when received by Tenant from Landlord or as later
improved, subject only to (a) reasonable use and ordinary wear and tear, and
(b) casualty damage to the extent covered by the policies of insurance
described in paragraph 4.13 or 4.14 (or that should have been covered by
insurance which Landlord is required to maintain under this Lease, but fails
to maintain).
4.7 REMOVAL OF PROPERTY. Upon expiration or earlier termination of
this Lease, Tenant may remove its trade fixtures, office supplies and
moveable office furniture and equipment not attached to the Premises;
PROVIDED THAT, (a) such removal is completed prior to the expiration or
earlier termination of this Lease; (b) such removal is not in violation of
Landlord's statutory lien rights; and (c) Tenant immediately repairs all
damage caused by or resulting from such removal. All other property in the
Premises and any Tenant Alterations (including wall-to-wall carpeting,
paneling, wall covering or lighting fixtures and apparatus) or any other
article affixed to the floor, walls or ceiling of the Premises, shall become
the property of Landlord and shall remain upon and be surrendered with the
Premises unless removal of any such item was a condition of Landlord's
consent to any proposed Tenant Alteration. Tenant waives all rights to any
payment or compensation for such Tenant Alterations. If Tenant shall fail to
remove any of its property of any nature from the Premises, Buildings or Land
at the expiration or earlier termination of this Lease or when Landlord has
the right of re-entry, Landlord may, at its option, remove and store such
property without liability for loss of or damage to such property, such
storage to be for the account and at the expense of Tenant. If Tenant fails
to pay the cost of storing any such property, after it has been stored for a
period of twenty (20) Business Days or more, Landlord may, at its option,
after it has been stored for a period of twenty (20) Business Days or more,
sell or permit to be sold, any or all such property at public or private sale
(and Landlord may become a purchaser at such sale), in such manner and at
such times and places as Landlord in its sole discretion may deem proper,
without notice to Tenant, and Landlord shall apply the proceeds of such sale:
first, to the cost and expense of such sale, including reasonable attorney's
fees actually incurred; second, to the payment of the costs or charges for
storing any such property; third, to the payment of any other sums of money
which may then be or later become due Landlord from Tenant under this Lease;
and, fourth, the balance, if any, to Tenant.
4.8 ACCESS. Tenant shall permit Landlord and Landlord's Agents to
enter into the Premises at any time on at least two (2) Business Days' notice
(except in case of emergency), for the purpose of inspecting the same or for
the purpose of repairing, altering or improving the Premises or the
Buildings. Nothing contained in this paragraph shall be deemed to impose any
obligation upon Landlord not expressly stated elsewhere in this Lease. When
reasonably necessary, Landlord may temporarily close Center, Buildings or
Land entrances, Buildings doors or other facilities, without liability to
Tenant by reason of such closure and without such action by Landlord being
construed as an eviction of Tenant or as relieving Tenant from the duty of
observing or performing any of the provisions of this Lease; PROVIDED THAT,
Landlord shall make commercially reasonable efforts to provide access for
Tenant to the Premises during any such temporary closure. Landlord shall
have the right to enter the Premises for the purpose of showing the Premises
to prospective tenants within the period of one-hundred twenty (120) Business
Days prior to the expiration or sooner termination of this Lease and to erect
on the Premises a suitable sign indicating the Premises are available.
Tenant shall give written notice to Landlord at least twenty (20) Business
Days prior to vacating the Premises and shall arrange to meet with Landlord
for a joint inspection of the Premises prior to vacating. In the event of
Tenant's failure to give such notice or arrange such joint inspection,
Landlord's inspection at or after
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Tenant's vacating the Premises shall be conclusively deemed correct for purposes
of determining Tenant's responsibility for repairs and restoration.
4.9 DAMAGE OR DESTRUCTION.
4.9.1 If the Premises are damaged by fire, earthquake or other casualty,
Tenant shall give immediate written notice thereof to Landlord. Within ninety
(90) days of receipt by Landlord of such notice, Landlord will notify Tenant
14
of Landlord's election regarding its options as set forth in the following two
sentences. If Landlord estimates that the damage can be repaired within one
hundred-eighty (180) Business Days after Landlord is notified by Tenant of such
damage and if there are sufficient insurance proceeds available to repair such
damage, then Landlord shall proceed with reasonable diligence to restore the
Premises to substantially the condition which existed prior to the damage and
this Lease shall not terminate. If, in Landlord's estimation, the damage cannot
be repaired within such 180 Business Day period or if there are insufficient
insurance proceeds available to repair such damage, Landlord may elect in its
absolute discretion to either: (a) terminate this Lease, effective ninety (90)
days after notice of said termination is delivered to Tenant, or (b) restore the
Premises to substantially the condition which existed prior to the damage and
this Lease will continue. If Landlord elects the option set forth in clause
(b), then (1) the Lease Term shall be extended for the time required to complete
such restoration, (2) Tenant shall pay to Landlord, upon demand, Tenant's Pro
Rata Share of any applicable deductible amount specified under Landlord's
insurance and (3) Landlord shall not be required to repair or restore fixtures,
improvements or other property of Tenant. Base Rent, Additional Rent,
Additional Tenant Improvement Rent, and any other sum due under this Lease
during any reconstruction period shall not be abated. Tenant agrees to look to
the provider of Tenant's insurance for coverage for the loss of Tenant's use of
the Premises and any other related losses or damages incurred by Tenant during
any reconstruction period. Notwithstanding the preceding two sentences, so long
as Tenant had in effect prior to the casualty a policy meeting the requirements
of paragraph 4.13.1(c), upon exhaustion of the insurance proceeds from such
policy, Base Rent shall be abated for the remaining reconstruction period
following exhaustion of such insurance proceeds. Notwithstanding anything in
this subparagraph 4.9.1 to the contrary, but subject to the provisions of
paragraph 6.8 (regarding force majeure), if Landlord has not completed
restoration of the Premises within eighteen (18) months after Landlord is
notified by Tenant of the damage, Tenant may, at its option, which must be
exercised, if at all, within five (5) days of the end of such 18-month period,
choose to terminate this Lease.
4.9.2 If the Center is damaged by fire, earthquake or other casualty and
more than fifty percent (50%) of the Center is rendered untenantable, without
regard to whether the Premises are affected by such damage, Landlord may in its
absolute discretion and without limiting any other options available to Landlord
under this Lease or otherwise, elect to terminate this Lease by notice in
writing to Tenant within forty (40) Business Days after the occurrence of such
damage. Such notice shall be effective twenty (20) Business Days after receipt
by Tenant unless a later date acceptable to Tenant is set forth in Landlord's
notice and approved by Tenant within ten (10) Business Days by written notice to
Landlord.
4.9.3 Notwithstanding anything contained in this Lease to the contrary, if
there is damage to the Premises or Center and the holder of any indebtedness
secured by a mortgage or deed of trust covering any such property requires that
the insurance proceeds be applied to such indebtedness, then Landlord shall have
the right to terminate this Lease by delivering written notice of termination to
Tenant within fifteen (15) Business Days after such requirement is made by such
holder.
4.10 CONDEMNATION. If all of the Premises, or such portions of the
Buildings as may be required for the Tenant's reasonable use of the Premises,
are taken by eminent domain or by conveyance in lieu thereof, this Lease
shall automatically terminate as of the date the physical taking occurs, and
all Base Rent, Additional Rent, Additional Tenant Improvement Rent, and other
sums payable under this Lease shall be paid to that date. In case of taking
of a part of the Premises or a portion of the Buildings or Center not
required for the Tenant's reasonable use of the Premises, then this Lease
shall continue in full force and effect and the Base Rent shall be equitably
reduced based on the proportion by which the floor area of the Premises is
reduced, such reduction in Base Rent to be effective as of the date the
physical taking occurs. Additional Rent and all other sums payable under
this Lease (except Additional Tenant Improvement Rent) shall not be abated
but Tenant's Pro Rata Share may be redetermined as equitable under the
circumstances; payment of Additional Tenant Improvement Rent shall not be
affected. Landlord reserves all rights to damages or awards for any taking
by eminent domain relating to the Premises, Center, Buildings, Land and the
unexpired term of this Lease. Tenant assigns to Landlord any right Tenant
may have to such damages or award and Tenant shall make no claim against
Landlord for damages for termination of its leasehold interest or
interference with Tenant's business. Tenant shall have the right, however,
to claim and recover from the condemning authority compensation for any loss
to which Tenant may be entitled for Tenant's moving expenses or other
relocation costs; PROVIDED THAT, such expenses or costs may be claimed only
if they are awarded separately in the eminent domain proceedings and not as a
part of the damages recoverable by Landlord.
4.11 PARKING. From the Commencement Date applicable to the Magni Space
until the day before the Commencement Date applicable to the Existing Space,
Tenant shall have the nonexclusive privilege to use forty-nine (49) parking
spaces on the Land in common with other tenants of Landlord, but only in
areas reasonably designated by Landlord. In addition, during such time
period, Tenant shall have the exclusive privilege to use two (2) parking
spaces on the Land for Tenant's visitors, but only in areas reasonably
designated by Landlord. From and after the Commencement Date applicable to
the Existing Space, Tenant shall have the nonexclusive privilege to use an
additional two hundred and forty-five (245) parking spaces on the Land in
common with other tenants of Landlord, but only in areas reasonably
designated by Landlord. In addition, during such time period, Tenant shall
have the
15
exclusive privilege to use an additional six (6) parking spaces on the Land
for Tenant's visitors, but only in areas reasonable designated by Landlord.
In the event Tenant shall lease from Landlord the BIT Space, NCD Space,
Stream Space, and/or any additional space in the Center during the Lease Term
as provided in this Lease, the number of parking spaces on the Land available
to Tenant on a nonexclusive basis shall increase by three and one-half (3.5)
parking spaces for each one thousand (1000) rentable square feet of
additional space leased, and the number of parking spaces available on the
Land to Tenant for the exclusive use of Tenant's visitors shall increase by
one and one-half (1.5) parking spaces for each ten thousand (10,000) rentable
square feet of additional space leased. Tenant's parking privileges shall be
subject to the rules and regulations relating to parking adopted by Landlord
from time to time. Landlord shall have the right to grant designated,
reserved parking stalls to other tenants in the Center. Landlord shall
reasonably assist Tenant in Tenant's efforts to prevent other tenants at the
Center from utilizing parking spaces near Tenant's access to the Premises.
4.12 INDEMNIFICATION. Tenant shall indemnify, defend and hold harmless
Landlord and Landlord's Agents from and against any and all Claims, arising
in whole or in part out of (a) the possession, use or occupancy of the
Premises by Tenant or Tenant's Agents or the business conducted in the
Premises by Tenant or Tenant's Agents, or (b) any act, omission or negligence
of Tenant or Tenant's Agents. Neither Landlord nor Landlord's Agents shall,
to the extent permitted by law, have any liability to Tenant, or to Tenant's
Agents, for any Claims arising out of any cause whatsoever, including repair
to any portion of the Premises; interruption in the use of the Premises or
any equipment therein; any accident or damage resulting from any use or
operation by Landlord, Tenant or any person or entity of heating, cooling,
electrical, sewage or plumbing equipment or apparatus; termination of this
Lease by reason of damage to the Premises, Center, or Buildings; fire,
robbery, theft, vandalism, mysterious disappearance or any other casualty;
actions of any other tenant of the Center or of any other person or entity;
inability to furnish any service required of Landlord as specified in this
Lease; or leakage in any part of the Premises or the Buildings from rain, ice
or snow, or from drains, pipes or plumbing fixtures in the Premises or the
Buildings; except to the extent such Claims arise out of the negligence or
willful misconduct of Landlord or breach by Landlord of the insurance
provisions of paragraph 4.14 of this Lease; PROVIDED THAT, in no event shall
Landlord be responsible for any interruption to Tenant's business or for any
indirect or consequential losses suffered by Tenant or Tenant's Agents. The
obligations of this paragraph shall be subject to the paragraph entitled
"WAIVER OF SUBROGATION".
4.13 TENANT INSURANCE.
4.13.1 Tenant shall, throughout the Lease Term, at its own expense, keep
and maintain in full force and effect:
(a) A policy of comprehensive general liability insurance, including
a contractual liability endorsement covering Tenant's obligations under the
paragraph captioned "INDEMNIFICATION", insuring against claims of bodily injury
and death or property damage or loss with a combined single limit at the
Commencement Date of this Lease of not less than Two Million Dollars
($2,000,000.00), which limit shall be reasonably increased during the Lease Term
at Landlord's request to reflect both increases in liability exposure arising
from inflation as well as from changing use of the Premises or changing legal
liability standards, which policy shall be payable on an "occurrence" rather
than a "claims made" basis, and which policy names Landlord and Manager and, at
Landlord's request Landlord's mortgage lender(s) or investment advisors, as
additional insureds;
(b) A policy of extended property insurance (what is commonly called
"all risk") covering Tenant's Improvements and Tenant's Alterations, furniture,
fixtures, equipment, inventory, and other personal property located on the
Premises for one hundred percent (100%) of the current replacement value of such
property; and
(c) Business interruption insurance in an amount sufficient to cover
costs, damages, lost income, expenses, Base Rent, Additional Rent, Additional
Tenant Improvement Rent, and all other sums payable under this Lease, should any
or all of the Premises not be usable for a period of up to three (3) months.
4.13.2 All insurance policies required under this paragraph shall be
with companies reasonably approved by Landlord and each policy shall provide
that it is not subject to cancellation or reduction in coverage except after
thirty (30) days' written notice to Landlord. Tenant shall cause to be
delivered to Landlord and, at Landlord's request Landlord's mortgage lender(s),
prior to the Commencement Date and from time to time thereafter, certificates
evidencing the existence and amounts of all such policies.
4.13.3 If Tenant fails to acquire or maintain any insurance or provide
any certificate required by this paragraph, Landlord may, but shall not be
required to, obtain such insurance or certificates and the reasonable costs
associated with obtaining such insurance or certificates shall be payable by
Tenant to Landlord on demand.
4.14 LANDLORD'S INSURANCE. Landlord shall, throughout the Lease Term,
keep and maintain in full force and effect:
(a) A policy of commercial general liability insurance, insuring against
claims of bodily injury and death or property damage or loss with a combined
single limit at the Commencement Date of not less than Five Million Dollars
($5,000,000.00), which limit shall be reasonably increased during the Lease Term
at Tenant's request to reflect both
16
increases in liability exposure arising from inflation as well as from
changing use of the Center or changing legal liability standards, and which
policy shall be payable on an "occurrence" rather than a "claims made" basis;
and
(b) A policy of extended property insurance (what is commonly called "all
risk") covering the Buildings and Landlord's personal property, if any, located
on the Land in the amount of one hundred percent (100%) of the current
replacement value of such property.
Landlord may, but shall not be required to, maintain property insurance coverage
for earthquakes and floods in such amounts and with such deductibles as Landlord
deems appropriate, and the entire amount of the deductible under any such policy
or policies shall be an Operating Cost. All deductibles under any other
policies maintained by Landlord are Operating Costs; PROVIDED, however, that the
amount, if any, by which the deductible under the policy of insurance required
to be maintained by Landlord pursuant to subparagraph 4.14(b), above, exceeds
$25,000.00 shall be excluded from the definition of Operating Costs for purposes
of this Lease only. Such policies may be "blanket" policies which cover other
properties owned by Landlord. Landlord shall cause to be delivered to Tenant,
prior to the Commencement Date and from time to time thereafter upon written
request by Tenant (but not more than once each Year), certificates evidencing
the existence and amounts of all such policies.
4.15 WAIVER OF SUBROGATION. Notwithstanding anything in this Lease to the
contrary, Landlord and Tenant hereby each waive and release the other from
any and all Claims or any loss or damage that may occur to the Land, Center,
Buildings, Premises, or personal property located therein, by reason of fire
or other casualty regardless of cause or origin, including the negligence or
misconduct of Landlord, Tenant, Landlord's Agents or Tenant's Agents, but
only to the extent of the insurance proceeds paid to such releasor under its
policies of insurance or that would have been paid to such releasor (if it
fails to maintain its policies of insurance). Each party to this Lease shall
promptly give to its insurance company written notice of the mutual waivers
contained in this subparagraph, and shall cause its insurance policies to be
properly endorsed, if necessary, to prevent the invalidation of any insurance
coverages by reason of the mutual waivers contained in this subparagraph.
4.16 ASSIGNMENT AND SUBLETTING BY TENANT.
4.16.1 Subject to subparagraph 4.16.7 below, Tenant shall not have the
right to assign, transfer, mortgage or encumber this Lease in whole or in part,
nor sublet the whole or any part of the Premises, nor allow the occupancy of all
or any part of the Premises by another, without first obtaining Landlord's
consent, which consent shall not be unreasonably withheld. Notwithstanding any
permitted assignment or subletting, Tenant shall at all times remain directly,
primarily and fully responsible and liable for the payment of all sums payable
under this Lease and for compliance with all of its other obligations as tenant
under this Lease. Upon the occurrence of an Event of Default, if the Premises
or any part of the Premises are then subject to an assignment or subletting,
Landlord, in addition to any other remedies provided in this Lease or by law,
may at its option, and upon five (5) days' notice to Tenant, collect directly
from such assignee or subtenant all rents becoming due to Tenant under such
assignment or sublease and apply such rents against any sums due to Landlord
from Tenant under this Lease, and no such collection shall be construed to
constitute a novation or release of Tenant from the further performance of
Tenant's obligations under this Lease. Tenant makes an absolute assignment to
Landlord of such assignments and subleases and any rent, security deposits and
other sums payable under such assignments and subleases as collateral to secure
the performance of the obligations of Tenant under this Lease.
4.16.2 In the event Tenant desires to assign this Lease or to sublet all
or any portion of the Premises, Tenant shall give written notice of such desire
to Landlord setting forth the name of the proposed subtenant or assignee, the
proposed term, the nature of the proposed subtenant's or assignee's business to
be conducted on the Premises, the rental rate, and any other particulars of the
proposed subletting or assignment that Landlord may reasonably request. Without
limiting the preceding sentence, Tenant shall also provide Landlord with:
(a) such financial information as Landlord may reasonably request concerning the
proposed subtenant or assignee, including recent financial statements certified
as accurate and complete by a certified public accountant and by the president,
managing partner or other appropriate officer of the proposed subtenant or
assignee; and (b) a copy of the proposed sublease or assignment or letter of
intent. At the same time that Tenant provides Landlord with notice of its
desire to assign or sublease, Tenant shall pay to Landlord all actual out-of
pocket expenses incurred by Landlord up to the sum of $500 as Landlord's fee for
processing such proposed assignment and sublease, including attorneys' fees
incurred by Landlord with respect to such processing. Receipt of such payment
shall not obligate Landlord to approve the proposed assignment or sublease.
4.16.3 In determining whether to grant or withhold consent to a proposed
assignment or sublease, Landlord may consider, and weigh, any relevant
commercial factor. Without limiting what may be construed as a factor
considered by Landlord in good faith, Tenant agrees that any one or more of the
following will be proper grounds for Landlord's disapproval of a proposed
assignment or sublease:
(a) Intentionally Deleted
17
(b) The proposed assignee or subtenant does not, in Landlord's good
faith judgment, have financial worth or creditworthiness sufficient to insure
the full and timely performance under this Lease;
(c) Landlord has received insufficient evidence of the financial
worth or creditworthiness of the proposed assignee or subtenant to make the
determination set forth in clause (b);
(d) The proposed assignee or subtenant has a reputation for disputes
in contractual relations, failure to observe and perform its contractual
obligations in a timely and complete manner or for negative business relations
in the business community for or otherwise as a tenant of property. Landlord
shall provide evidence, if any, of said reputation to Tenant upon request,
unless such evidence was obtained by Landlord in confidence (which evidence
Tenant shall not disclose to any entity);
(e) Landlord has received from any prior lessor of the proposed
assignee or subtenant a negative report concerning such prior lessor's
experience with the proposed assignee or subtenant. Landlord shall provide
evidence, if any, of said negative report to Tenant upon request, unless such
evidence was obtained by Landlord in confidence (which evidence Tenant shall not
disclose to any entity);
(f) Landlord has had prior negative leasing experience with the
proposed assignee or subtenant;
(g) The use of the Premises by the proposed assignee or subtenant
will not comply with the Permitted Uses;
(h) In Landlord's good faith judgment, the proposed assignee or
subtenant is engaged in a business, or the Premises or any part of the Premises
will be used in a manner, that is not in keeping with the then standards of the
Center, or that is not compatible with the businesses of other tenants in the
Center, or that is inappropriate for the Center, or that will violate any
negative covenant as to use contained in any other lease of space in the Center;
(i) The use of the Premises by the proposed assignee or subtenant
will violate any Governmental Requirement or create a violation of Access Laws;
(j) Tenant is in default of any obligation of Tenant under this
Lease, or Tenant has defaulted under this Lease on three (3) or more occasions
during the twenty-four (24) months preceding the date that Tenant shall request
such consent; PROVIDED, nothing shall prohibit Tenant from curing any alleged
default under protest;
(k) Landlord does not approve of any of the tenant improvements
required for the proposed assignee or subtenant, unless assignee or subtenant
agrees to waive any tenant improvement requirements not approved by Landlord;
and
(l) The rental to be paid pursuant to the proposed sublease or
assignment is below the prevailing market rate for comparable sublease or
assignment transactions in the Beaverton, Oregon area.
4.16.4 Within fifteen (15) Business Days after Landlord's receipt of all
required information to be supplied by Tenant pursuant to this paragraph,
Landlord shall notify Tenant of Landlord's approval, disapproval or conditional
approval of any proposed assignment or subletting. Landlord shall have no
obligation to respond unless and until all required information has been
submitted. In the event Landlord approves of any proposed assignment or
subletting, Tenant and the proposed assignee or sublessee shall execute and
deliver to Landlord an assignment (or subletting) and assumption agreement in
form and content satisfactory to Landlord.
4.16.5 Any transfer, assignment or hypothecation of any of the stock or
interest in, or the assets of, Tenant which is either: (a) greater than fifty
percent (50%) of such stock, interest or assets or (b) intended as a subterfuge
denying Landlord the benefits of this paragraph, shall be deemed to be an
assignment within the meaning and provisions of this paragraph and shall be
subject to the provisions of this paragraph.
4.16.6 If Landlord consents to any assignment or sublease and Tenant
receives rent or any other consideration, either initially or over the term of
the assignment or sublease, in excess of the Base Rent, Additional Rent, and
Additional Tenant Improvement Rent (or, in the case of a sublease of a portion
of the Premises, in excess of the Base Rent, Additional Rent and Additional
Tenant Improvement Rent paid by Tenant on a square footage basis under this
Lease), Tenant shall pay to Landlord seventy-five percent (75%) of such excess;
PROVIDED THAT, prior to allocating such excess as described above, Tenant shall
be entitled to recover one hundred percent (100%) of all reasonable out of
pocket costs incurred by Tenant in connection with such assignment or subleasing
(including all leasing commissions, attorneys' fees, marketing costs and
subtenant improvement costs paid by Tenant to unrelated parties).
4.16.7 Notwithstanding anything in this paragraph 4.16 to the contrary,
Tenant may, upon advance written notice to Landlord but without the necessity of
Landlord's consent, assign or sublease all or any portion of the Premises to any
entity which owns a controlling interest in Tenant, to any entity the
controlling interest of which is owned by Tenant, or to any successor entity to
Tenant by merger or operation of law, PROVIDED THAT: (a) such entity and any
parent of such entity agrees to be bound by all the terms of this Lease
(although such entity and such parent shall not become a party to this Lease);
(b) such entity's parking requirements will be no greater than Tenant's as set
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forth in this Lease; (c) the use of the subleased or assigned portion of the
Premises by the such entity will be substantially the same as the Permitted
Uses, and will not violate any negative covenant as to use contained in any
other lease of space in the Center; (d) at the time of the delivery of notice to
Landlord, Tenant is not in default of any obligation of Tenant under this Lease,
and has not defaulted under this Lease on three (3) or more occasions during the
twenty-four (24) months preceding the date that Tenant shall deliver such
notice; (e) such entity has, in Landlord's good faith judgment, financial worth
or creditworthiness equal to or greater than that of Tenant as of the execution
date of this Lease; and (f) such entity is a United States corporation whose
shares are publicly traded on an American stock exchange. For purposes of this
subparagraph, the term "controlling interest" means more than 50% of the voting
stock of the corporation.
4.17 ASSIGNMENT BY LANDLORD. Landlord shall have the right to transfer
and assign, in whole or in part, its rights and obligations under this Lease
and in any and all of the Land, Buildings, or Center. If Landlord sells or
transfers any or all of the Buildings or Center, including the Premises,
Landlord and Landlord's Agents shall, upon consummation of such sale or
transfer, be released automatically from any liability relating to
obligations or covenants under this Lease to be performed or observed after
the date of such transfer, and in such event, Tenant agrees to look solely to
Landlord's successor-in-interest with respect to such liability.
4.18 ESTOPPEL CERTIFICATES. Tenant shall, from time to time, upon the
written request of Landlord, execute, acknowledge and deliver to Landlord or
its designee a written statement stating: (a) the date this Lease was
executed and the date it expires; (b) the date Tenant entered into occupancy
of the Premises; (c) the amount of monthly Base Rent, Additional Rent, and
Additional Tenant Improvement Rent, and the date to which such Base Rent,
Additional Rent, and Additional Tenant Improvement Rent have been paid; and
(d) certifying that (1) this Lease is in full force and effect and has not
been assigned, modified, supplemented or amended in any way (or specifying
the date of the agreement so affecting this Lease); (2) Landlord is not in
breach of this Lease (or, if so, a description of each such breach) and that
no event, omission or condition has occurred which would result, with the
giving of notice or the passage of time or both, in a breach of this Lease by
Landlord; (3) this Lease represents the entire agreement between the parties
with respect to the Premises; (4) all required contributions by Landlord to
Tenant on account of Tenant Improvements have been received; (5) on the date
of execution, there exist no defenses or offsets which the Tenant has against
the enforcement of this Lease by the Landlord; (6) no Base Rent, Additional
Rent, Additional Tenant Improvement Rent or other sums payable under this
Lease have been paid in advance except for Base Rent, Additional Rent, and
Additional Tenant Improvement Rent for the then current month; (7) no
security has been deposited with Landlord (or, if so, the amount of such
security); and (8) such other information as may be reasonably requested by
Landlord. If Tenant fails to respond within ten (10) Business Days of its
receipt of a written request by Landlord as provided in this paragraph,
Tenant shall be deemed to have admitted the accuracy of any information
supplied by Landlord to a prospective purchaser, mortgagee or assignee. It
is intended that any such statement delivered pursuant to this paragraph may
be relied upon by a prospective purchaser or mortgagee of Landlord's interest
or an assignee of any such mortgagee.
4.19 MODIFICATION FOR LENDER. If, in connection with obtaining
construction, interim or permanent financing for the Center, Buildings or
Land, Landlord's lender, if any, shall request reasonable modifications to
this Lease as a condition to such financing, Tenant will not unreasonably
withhold or delay its consent to such modifications; PROVIDED THAT, such
modifications do not increase the obligations of Tenant under this Lease or
adversely affect Tenant's rights under this Lease. Tenant shall be entitled
to compensation for its reasonable out-of-pocket expenses (up to $500.00)
regarding any such requested modification.
4.20 HAZARDOUS SUBSTANCES.
4.20.1 Tenant agrees that neither Tenant, any of Tenant's Agents nor any
other person will store, place, generate, manufacture, refine, handle, or locate
on, in, under or around the Land, Center, or Buildings any Hazardous Substance,
except for storage, handling and use of reasonable quantities and types of
cleaning fluids and office supplies in the Premises in the ordinary course and
the prudent conduct of Tenant's business in the Premises, PROVIDED THAT, (a) the
storage, handling and use of such permitted Hazardous Substances must at all
times conform to all Governmental Requirements and to applicable fire, safety
and insurance requirements; (b) the types and quantities of permitted Hazardous
Substances which are stored in the Premises must be reasonable and appropriate
to the nature and size of Tenant's operation in the Premises and reasonable and
appropriate for a first-class building of the same or similar use and in the
same market area as the Center; (c) no Hazardous Substance shall be spilled or
disposed of on, in, under or around the Land, Center, or Buildings or otherwise
discharged from the Premises or any area adjacent to the Land, Center, or
Buildings; and (d) in no event will Tenant be permitted to store, handle or use
on, in, under or around the Premises any Hazardous Substance which will increase
the rate of fire or extended coverage insurance on the Land, Center, or
Buildings, unless: (1) such Hazardous Substance and the expected rate increase
have been specifically disclosed in writing to Landlord; (2) Tenant has agreed
in writing to pay any rate increase related to each such Hazardous Substance;
and (3) Landlord has approved in writing each such Hazardous Substance, which
approval shall be subject to Landlord's discretion.
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4.20.2 Tenant shall indemnify, defend and hold harmless Landlord and
Landlord's Agents from and against any and all Claims arising out of any breach
of any provision of this paragraph, which expenses shall also include laboratory
testing fees, personal injury claims, clean-up costs and environmental
consultants' fees. Tenant agrees that Landlord may be irreparably harmed by
Tenant's breach of this paragraph and that a specific performance action may
appropriately be brought by Landlord; PROVIDED THAT, Landlord's election to
bring or not bring any such specific performance action shall in no way limit,
waive, impair or hinder Landlord's other remedies against Tenant.
4.20.3 As of the execution date of this Lease, Tenant represents and
warrants to Landlord that, except as otherwise disclosed by Tenant to Landlord,
Tenant has no intent to bring any Hazardous Substances on, in or under the
Premises except for the type and quantities authorized in the first paragraph of
the section entitled "HAZARDOUS SUBSTANCES."
4.21 ACCESS LAWS.
4.21.1 Tenant agrees to notify Landlord immediately if Tenant receives
notification or otherwise becomes aware of (1) any condition or situation on,
in, under or around the Land, Center, or Buildings which may constitute a
violation of any Access Laws, or (2) any threatened or actual lien, action or
notice that the Land, Center, or Buildings is not in compliance with any Access
Laws. If Tenant is responsible for such condition, situation, lien, action or
notice under this paragraph, Tenant's notice to Landlord shall include a
statement as to the actions Tenant proposes to take in response to such
condition, situation, lien, action or notice.
4.21.2 Tenant shall not alter or permit any assignee or subtenant or any
other person to alter the Premises in any manner which would violate any Access
Laws or increase Landlord's responsibilities for compliance with Access Laws,
without the prior approval of the Landlord. In connection with any such
approval, Landlord may require a certificate of compliance with Access Laws from
an architect, engineer or other person acceptable to Landlord. Tenant agrees to
pay the reasonable fees incurred by such architect, engineer or other third
party in connection with the issuance of such certificate of compliance.
Landlord's consent to any proposed Tenant Alteration shall (a) not relieve
Tenant of its obligations or indemnities contained in this paragraph or this
Lease or (b) be construed as a warranty that such proposed alternation complies
with any Access Law.
4.21.3 Tenant shall be solely responsible for all costs and expenses
relating to or incurred in connection with: (a) failure of the Premises to
comply with the Access Laws; and (b) bringing the Center and the common areas of
the Center into compliance with Access Laws, if and to the extent such
noncompliance arises out of or relates to: (1) Tenant's use of the Premises
(other than Tenant's current use of the Premises as a commercial facility),
including the hiring of employees; (2) any Tenant Alterations to the Premises;
(3) any Tenant Improvements constructed in the Premises at the request of
Tenant, regardless of whether such improvements are constructed prior to or
after the Commencement Date; or (4) the Premises becoming a public
accommodation, as that term is used in the Access Laws, as a result of Tenant's
use thereof.
4.21.4 Landlord shall be responsible for all costs and expenses relating
to or incurred in connection with bringing the common areas of the Center into
compliance with Access Laws, unless such costs and expenses are Tenant's
responsibility as provided in the preceding subparagraph. Any cost or expense
paid or incurred by Landlord to bring the Premises or common areas of the Center
into compliance with Access Laws which is not Tenant's responsibility under the
preceding subparagraphs shall be amortized over the useful economic life of the
improvements (not to exceed twenty (20) years) using an amortization rate of
twelve percent (12%) per annum, and shall be an Operating Cost for purposes of
this Lease.
4.21.5 Tenant agrees to indemnify, defend and hold harmless Landlord and
Landlord's Agents from and against any and all Claims arising out of or relating
to any failure of Tenant or Tenant's Agents to comply with Tenant's obligations
under this paragraph.
4.21.6 The provisions of this paragraph shall supersede any other
provisions in this Lease regarding Access Laws, to the extent inconsistent with
the provisions of any other paragraphs.
4.22 QUIET ENJOYMENT. Landlord covenants that Tenant, upon paying Base
Rent, Additional Rent, Additional Tenant Improvement Rent, and all other sums
payable under this Lease and performing all covenants and conditions required
of Tenant under this Lease shall and may peacefully have, hold and enjoy the
Premises without hindrance or molestation by Landlord or any entity or person
for whom Landlord is vicariously liable under applicable law.
4.23 SIGNS. Subject to compliance with all Governmental Requirements,
Tenant shall have the right to install (a) signs on the Buildings' exterior
as described in EXHIBIT F attached to this Lease (if any), (b) signs
consistent with Existing Space signage (including signage on the Buildings'
exterior and monument signage), or (c) signs consistent with signage
permitted elsewhere in the Center or as currently allowed under the Existing
Lease. The exact size, appearance and location of such signs shall be
subject to Landlord's prior written approval (which shall not be unreasonably
withheld or delayed) and shall be consistent with Landlord's existing sign
criteria then in existence for the Center. Any and all costs in connection
with the permitting, fabrication, installation, maintenance and removal
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of Tenant's signs (including the cost of removal of the signs and repair to
the Buildings caused by such removal) shall be borne by Tenant. Tenant
agrees to maintain any such signs, awning, canopy, decoration, lettering,
advertising matter or other thing as may be approved, in good condition at
all times. Tenant shall not inscribe an inscription, or post, place, or in
any manner display any sign, notice, picture, placard or poster, or any
advertising matter whatsoever, anywhere in or about the Land or Center at
places visible (either directly or indirectly as an outline or shadow on a
glass pane) from anywhere outside the Premises without first obtaining
Landlord's consent, unless permitted in EXHIBIT F. Any such consent by
Landlord shall be upon the understanding and condition that Tenant shall
remove the same at the expiration or sooner termination of this Lease.
4.24 SUBORDINATION. Tenant subordinates this Lease and
all rights of Tenant under this Lease to any mortgage, deed of trust, ground
lease or vendor's lien, or similar instrument which may from time to time be
placed upon the Premises (and all renewals, modifications, replacements and
extensions of such encumbrances), and each such mortgage, deed of trust, ground
lease or lien or other instrument shall be superior to and prior to this Lease;
PROVIDED THAT, Landlord provides Tenant with a nondisturbance agreement
negotiated from the standard form of the applicable lender or ground lessor that
does not materially affect Tenant's rights hereunder. Tenant further covenants
and agrees that if the lender or ground lessor acquires the Premises as a
purchaser at any foreclosure sale or otherwise, Tenant shall, provided such
party does not disturb Tenant (except as allowed under this Lease), recognize
and attorn to such party as landlord under this Lease, and shall make all
payments required hereunder to such new landlord without deduction or set-off
and, upon the request of such purchaser or other successor, execute, deliver and
acknowledge documents confirming such attornment. Tenant waives the provisions
of any law or regulation, now or hereafter in effect, which may give or purport
to give Tenant any right to terminate or otherwise adversely affect this Lease
and the obligations of Tenant hereunder in the event that any such foreclosure
or termination or other proceeding is prosecuted or completed. Landlord
represents to Tenant that as of the date this Lease is executed by Landlord, the
Premises is not subject to any mortgage, deed of trust or ground lease.
4.25 WORKERS COMPENSATION IMMUNITY. If and to the extent that Tenant is
obligated to indemnify, defend or hold harmless Landlord or Landlord's Agents
from any Claims arising from its use of the Premises or any act or failure to
act by Tenant or Tenant's Agents or otherwise, Tenant expressly waives, to
and in favor of Landlord and Landlord's Agents, its statutory workers
compensation act employers immunity relative to any injury to an employee or
employees of Tenant.
4.26 BROKERS. Upon execution of this Lease, Landlord shall pay to Xxxx
Xxxxx Tenant Counsel L.L.C., attn: Xxxxxxx X. Xxxx, as commission for the
lease of the Magni Space, the amount determined pursuant to the terms of this
paragraph set forth below. In the event Tenant shall lease from Landlord the
BIT Space, NCD Space, Stream Space, or additional space pursuant to paragraph
2.2.4 (or any other space in the Center which is substituted for any of the
preceding spaces, the negotiations for the rental of which were actively
participated in by Xxxx Xxxxx Tenant Counsel L.L.C. pursuant to Tenant's
written designation of said company as Tenant's representative, and only to
the extent that such substitute space does not exceed the square footage of
the applicable replaced space), Landlord shall be responsible to pay the
commission due to Xxxx Xxxxx Tenant Counsel L.L.C. as set forth below for the
lease by Tenant of such space. The commission to be paid shall equal two and
one-half percent (2.5%) of the aggregate Base Rent for the first sixty (60)
months in which Base Rent is to be paid, plus one and one-quarter percent
(1.25%) of the aggregate Base Rent for the remainder of the lease term;
PROVIDED, however, that no commission shall be due or payable on any rental
paid by Tenant for its lease of any space in the Center after February 29,
2004. Except as provided in the preceding sentences, and except for
commissions which may be due to Xxxxxxxx Xxxx NW, Inc., Tenant agrees to be
solely responsible for all commissions, finders fees and any other sums
claimed to be due by any broker, finder or other intermediary in connection
with this Lease of the Premises or any lease by Tenant of the Existing Space,
the Magni Space, the BIT Space, the NCD Space, the Stream Space, or any other
space in the Center. Each party to this Lease shall indemnify, defend and
hold harmless the other party from and against any and all Claims asserted
against such other party by any real estate broker, finder or intermediary
for which the indemnifying party is responsible under this paragraph.
4.27 EXCULPATION AND LIMITATION OF LIABILITY. Each joint venturer of
Landlord has executed this Lease by its trustee or investment advisor signing
solely in a representative capacity. Notwithstanding anything contained in
this Lease to the contrary, Tenant confirms that the covenants of Landlord
are made and intended, not as personal covenants of the trustee or investment
advisor, or for the purpose of binding the trustee or investment advisor
personally, but solely in the exercise of the representative powers conferred
upon the trustee or investment advisor by its principal. Liability with
respect to the entry and performance of this Lease by or on behalf of
Landlord, however it may arise, shall be asserted and enforced only against
the Landlord's estate and interest in the Center and neither Landlord nor
either joint venturer thereof shall have any personal liability in the event
of any claim against Landlord arising out of or in connection with this
Lease, the relationship of Landlord and Tenant or Tenant's use of the
Premises. Further, in no event whatsoever shall any Landlord's Agent have
any liability or responsibility whatsoever arising out of or in connection
with this Lease, the relationship of Landlord and Tenant or
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Tenant's use of the Premises. Any and all personal liability, if any,
beyond that which may be asserted under this paragraph, is expressly waived
and released by Tenant and by all persons claiming by, through or under
Tenant.
4.28 Intentionally Deleted.
4.29 MECHANIC'S LIENS AND TENANT'S PERSONAL PROPERTY TAXES
4.29.1 Tenant shall have no authority, express or implied, to create or
place any lien or encumbrance of any kind or nature whatsoever upon, or in any
manner to bind, the interest of Landlord or Tenant in the Premises or to charge
the rentals payable under this Lease for any Claims in favor of any person
dealing with Tenant, including those who may furnish materials or perform labor
for any construction or repairs. Tenant shall pay or cause to be paid all sums
legally due and payable by it on account of any labor performed or materials
furnished in connection with any work performed on the Premises on which any
lien is or can be validly and legally asserted against its leasehold interest in
the Premises and Tenant shall indemnify, defend and hold harmless Landlord from
any and all Claims arising out of any such asserted Claims. Tenant agrees to
give Landlord immediate written notice of any such Claim.
4.29.2 Tenant shall be liable for all taxes levied or assessed against
personal property, furniture or fixtures placed by Tenant in the Premises. If
any such taxes for which Tenant is liable are levied or assessed against
Landlord or Landlord's property and Landlord elects to pay them or if the
assessed value of Landlord's property is increased by inclusion of such personal
property, furniture or fixtures and Landlord elects to pay the taxes based on
such increase, Tenant shall reimburse Landlord for the sums so paid by Landlord,
upon demand by Landlord.
SECTION 5: DEFAULT AND REMEDIES
5.1 EVENTS OF DEFAULT.
5.1.1 The occurrence of any one or more of the following events shall
constitute a material default and breach of this Lease by Tenant ("EVENT OF
DEFAULT"):
(a) vacation or abandonment of all or any portion of the Premises;
(b) failure by Tenant to make any payment of Base Rent, Additional
Rent, Additional Tenant Improvement Rent, or any other sum payable by Tenant
under this Lease within three (3) Business Days after its due date, PROVIDED
THAT, no more than two (2) times during any continuous twelve-month period, and
no more than five (5) times during the entire Lease Term (including any
extension), Landlord shall provide written notice of such failure to Tenant and
there shall not be an Event of Default under this subparagraph 5.1.1(b) unless
Tenant's failure to make such payment shall continue for a period of five (5)
Business Days after such notice;
(c) failure by Tenant to observe or perform any covenant or condition
of this Lease, other than the making of payments, where such failure shall
continue for a period of twenty (20) Business Days after written notice from
Landlord or, if such failure cannot be cured using diligent efforts in such time
period, Tenant shall have an additional sixty (60) Business Days to complete
such cure so long as Tenant commenced such cure within the original twenty (20)
Business Day time period and continues thereafter to diligently pursue
completion of the cure during the additional sixty (60) Business-Day period;
(d) (1) the making by Tenant of any general assignment or general
arrangement for the benefit of creditors; (2) the filing by or against Tenant of
a petition in bankruptcy, including reorganization or arrangement, unless, in
the case of a petition filed against Tenant, the same is dismissed within twenty
(20) Business Days; (3) the appointment of a trustee or receiver to take
possession of substantially all of Tenant's assets located in the Premises or of
Tenant's interest in this Lease; (4) any execution, levy, attachment or other
process of law against any property of Tenant or Tenant's interest in this
Lease; (5) adjudication that Tenant is bankrupt; (6) the making by Tenant of a
transfer in fraud of creditors; or (7) the failure of Tenant to generally pay
its debts as they become due; or
(e) there shall occur a default by Tenant under the Existing Lease
which is not cured within any applicable cure period specified in the Existing
Lease.
5.1.2 Tenant shall notify Landlord promptly of any Event of Default or
any facts, conditions or events which, with the giving of notice or passage of
time or both, would constitute an Event of Default.
5.1.3 If a petition in bankruptcy is filed by or against Tenant, and if
this Lease is treated as an "unexpired lease" under applicable bankruptcy law in
such proceeding, then Tenant agrees that Tenant shall not attempt nor cause any
trustee to attempt to extend the applicable time period within which this Lease
must be assumed or rejected.
5.2 REMEDIES. If any Event of Default occurs, Landlord may at any time
after such occurrence, with or without notice or demand except as stated in
this paragraph, and without limiting Landlord in the exercise of any right or
remedy at law which Landlord may have by reason of such Event of Default,
exercise the rights and remedies, either singularly or in combination, as are
specified or described in the subparagraphs of this paragraph.
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5.2.1 Landlord may terminate this Lease and all rights of Tenant under
this Lease either immediately or at some later date by giving Tenant written
notice that this Lease is terminated. If Landlord so terminates this Lease,
then Landlord may recover from Tenant the sum of:
(a) the unpaid Base Rent, Additional Rent, Additional Tenant
Improvement Rent, and all other sums payable under this Lease which have been
earned at the time of termination;
(b) interest at the Default Rate on the unpaid Base Rent, Additional
Rent, Additional Tenant Improvement Rent, and all other sums payable under this
Lease which have been earned at the time of termination; plus
(c) the amount by which the unpaid Base Rent, Additional Rent,
Additional Tenant Improvement Rent, and all other sums payable under this Lease
which would have been earned after termination until the time of award exceeds
the amount of such rental loss, if any, as Tenant affirmatively proves could
have been reasonably avoided and interest on such excess at the Default Rate;
plus
(d) the amount by which the aggregate of the unpaid Base Rent,
Additional Rent, Additional Tenant Improvement Rent, and all other sums payable
under this Lease for the balance of the Lease Term after the time of award
exceeds the amount of rental loss, if any, as Tenant affirmatively proves could
be reasonably avoided, with such difference being discounted to present value at
the Prime Rate at the time of award; plus
(e) any other amount necessary to compensate Landlord for the
detriment proximately caused by Tenant's failure to perform Tenant's obligations
under this Lease or which, in the ordinary course of things, would be likely to
result from such failure, including leasing commissions, tenant improvement
costs, renovation costs and advertising costs; plus
(f) all such other amounts in addition to or in lieu of the foregoing
as may be permitted from time to time by applicable law.
5.2.2 Landlord shall also have the right, with or without terminating this
Lease, to re-enter the Premises and remove all persons and property from the
Premises. Landlord may cause property so removed from the Premises to be stored
in a public warehouse or elsewhere at the expense and for the account of Tenant.
5.2.3 Landlord shall also have the right, without terminating this Lease,
to accelerate and recover from Tenant the sum of all unpaid Base Rent,
Additional Rent, Additional Tenant Improvement Rent, and all other sums payable
under the then remaining term of the Lease, discounting such amount to present
value at the Prime Rate.
5.2.4 If Tenant vacates, abandons or surrenders the Premises without
Landlord's consent, or if Landlord re-enters the Premises as provided in
subparagraph 5.2.2 or takes possession of the Premises pursuant to legal
proceedings or through any notice procedure provided by law, then, if Landlord
does not elect to terminate this Lease, Landlord may, from time to time, without
terminating this Lease, either (a) recover all Base Rent, Additional Rent,
Additional Tenant Improvement Rent, and all other sums payable under this Lease
as they become due or (b) relet the Premises or any part of the Premises on
behalf of Tenant for such term or terms, at such rent or rents and pursuant to
such other provisions as Landlord, in its sole discretion, may deem advisable,
all with the right, at Tenant's cost, to make alterations and repairs to the
Premises and recover any deficiency from Tenant as set forth in
subparagraph 5.2.5.
5.2.5 None of the following remedial actions, singly or in combination,
shall be construed as an election by Landlord to terminate this Lease unless
Landlord has in fact given Tenant written notice that this Lease is terminated:
an act by Landlord to maintain or preserve the Premises; any efforts by Landlord
to relet the Premises; any repairs or alterations made by Landlord to the
Premises; re-entry, repossession or reletting of the Premises by Landlord
pursuant to this paragraph; or the appointment of a receiver, upon the
initiative of Landlord, to protect Landlord's interest under this Lease. If
Landlord takes any of the foregoing remedial action without terminating this
Lease, Landlord may nevertheless at any time after taking any such remedial
action terminate this Lease by written notice to Tenant.
5.2.6 If Landlord relets the Premises, Landlord shall apply the revenue
from such reletting as follows: FIRST, to the payment of any indebtedness other
than Base Rent, Additional Rent, Additional Tenant Improvement Rent, or any
other sums payable under this Lease by Tenant to Landlord; SECOND, to the
payment of any cost of reletting (including finders' fees and leasing
commissions); THIRD, to the payment of the cost of any alterations,
improvements, maintenance and repairs to the Premises; and FOURTH, to the
payment of Base Rent, Additional Rent, Additional Tenant Improvement Rent, and
other sums due and payable and unpaid under this Lease. Landlord shall hold and
apply the residue, if any, to payment of future Base Rent, Additional Rent,
Additional Tenant Improvement Rent, and other sums payable under this Lease as
the same become due, and shall deliver the eventual balance, if any, to Tenant.
Should revenue from letting during any month, after application pursuant to the
foregoing provisions, be less than the sum of the Base Rent, Additional Rent,
Additional Tenant Improvement Rent, and other sums payable under this Lease and
Landlord's expenditures for the Premises during such month. Tenant shall be
obligated to pay such deficiency to Landlord as and when such deficiency arises.
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5.2.7 Pursuit of any of the foregoing remedies shall not preclude
pursuit of any of the other remedies provided in this Lease or by law (all such
remedies being cumulative), nor shall pursuit of any remedy provided in this
Lease constitute a forfeiture or waiver of any Base Rent, Additional Rent,
Additional Tenant Improvement Rent, or other sum payable under this Lease or of
any damages accruing to Landlord by reason of the violation of any of the
covenants or conditions contained in this Lease.
5.3 RIGHT TO PERFORM. If Tenant shall fail to pay any sum of money,
other than Base Rent, Additional Rent, or Additional Tenant Improvement Rent
required to be paid by it under this Lease or shall fail to perform any other
act on its part to be performed under this Lease, and such failure shall
continue for fifteen (15) Business Days after notice of such failure by
Landlord, or such shorter time if necessary under the circumstances, Landlord
may, but shall not be obligated to, and without waiving or releasing Tenant
from any obligations of Tenant, make such payment or perform such other act
on Tenant's part to be made or performed as provided in this Lease. Landlord
shall have (in addition to any other right or remedy of Landlord) the same
rights and remedies in the event of the nonpayment of sums due under this
paragraph as in the case of default by Tenant in the payment of Base Rent.
5.4 LANDLORD'S DEFAULT. In the event that Landlord defaults under or
breaches this Lease, Tenant shall notify Landlord of such default or breach
in writing, and Tenant shall not exercise any right or remedy which Tenant
may have under this Lease or at law if Landlord commences to cure such
default or breach within twenty (20) Business Days after receipt of Tenant's
notice and thereafter diligently prosecutes the cure to completion. If
Landlord fails to commence or diligently prosecute such cure as provided in
the preceding sentence, then, subject to the additional conditions set forth
below, Tenant, upon ten (10) Business Days prior written notice to Landlord,
may exercise rights of self-help to cure such default and may invoice
Landlord for all reasonable and actual out-of-pocket costs ("SELF-HELP
COSTS") incurred by Tenant in effectuating such cure, PROVIDED THAT, (a)
Tenant shall not have any rights of self-help unless Landlord's breach has a
material adverse impact on the conduct of Tenant's business in, or quiet
enjoyment of, the Premises, (b) Tenant shall be responsible for any Claims
for property damage or personal injury arising out of or relating to Tenant's
effectuating such cure, (c) all of the terms and conditions set forth in
paragraph 4.5 shall be applicable to any work performed by or on behalf of
Tenant in effectuating such cure, and (d) Tenant shall not have any right to
offset or credit the Self-Help Costs or any portion thereof against Base
Rent, Additional Rent, Additional Tenant Improvement Rent, or any other sums
payable by Tenant under this Lease.
SECTION 6: MISCELLANEOUS PROVISIONS
6.1 NOTICES. Any notice, request or written communication required or
permitted to be delivered under this Lease shall be: (a) in writing; (b)
transmitted by personal delivery, express or courier service, United States
Postal Service in the manner described below, or electronic means of
transmitting written material; and (c) deemed to be delivered on the earlier
of the date received or four (4) Business Days after having been deposited in
the United States Postal Service, postage prepaid. Such writings shall be
addressed to Landlord or Tenant, as the case may be, at the respective
designated addresses set forth opposite their signatures, or at such other
address(es) as they may, after the execution date of this Lease, specify by
written notice delivered in accordance with this paragraph, with copies to
the persons at the addresses, if any, designated opposite each party's
signature. Those notices which contain a notice of breach or default or a
demand for performance may be sent by any of the methods described in clause
(b) above, but if transmitted by personal delivery or electronic means, shall
also be sent concurrently by certified or registered mail, return receipt
requested.
6.2 ATTORNEY'S FEES AND EXPENSES. In the event either party requires
the services of an attorney in connection with enforcing the terms of this
Lease, or in the event suit is brought for the recovery of Base Rent,
Additional Rent, Additional Tenant Improvement Rent or any other sums payable
under this Lease or for the breach of any covenant or condition of this
Lease, or for the restitution of the Premises to Landlord or the eviction of
Tenant during the Lease Term or after the expiration or earlier termination
of this Lease, the substantially prevailing party shall be entitled to a
reasonable sum for attorney's and paralegal's fees incurred at the trial or
appellate levels and for all costs and expenses associated with such levels.
6.3 NO ACCORD AND SATISFACTION. No payment by Tenant or receipt by
Landlord of an amount less than the Base Rent, Additional Rent, Additional
Tenant Improvement Rent, or any other sum due and payable under this Lease
shall be deemed to be other than a payment on account of the Base Rent,
Additional Rent, Additional Tenant Improvement Rent, or other such sum, nor
shall any endorsement or statement on any check or any letter accompanying
any check or payment be deemed an accord and satisfaction, nor preclude
Landlord's right to recover the balance of any amount payable or Landlord's
right to pursue any other remedy provided in this Lease or at law.
6.4 SUCCESSORS; JOINT AND SEVERAL LIABILITY. Except as provided in the
paragraph captioned "EXCULPATION AND LIMITATION OF LIABILITY" and subject to
the paragraph captioned "ASSIGNMENT AND SUBLETTING BY LANDLORD", all of the
covenants and conditions contained in this Lease shall apply to and be
binding upon Landlord and Tenant and their respective heirs, executors,
administrators, successors and
24
assigns. In the event that more than one person, partnership, company,
corporation or other entity is included in the term "Tenant," then each such
person, partnership, company, corporation or other entity shall be jointly
and severally liable for all obligations of Tenant under this Lease.
6.5 CHOICE OF LAW. This Lease shall be construed and governed by the
laws of the state in which the Land is located. Tenant consents to
Landlord's choice of venue for any legal proceeding brought by Landlord or
Tenant to enforce the terms of this Lease.
6.6 NO WAIVER OF REMEDIES. The waiver by Landlord or Tenant of any
covenant or condition contained in this Lease shall not be deemed to be a
waiver of any subsequent breach of such covenant or condition nor shall any
custom or practice which may develop between the parties in the
administration of this Lease be construed to waive or lessen the rights of
Landlord or Tenant to insist on the strict performance by Tenant or Landlord
of all of the covenants and conditions of this Lease. No act or thing done
by Landlord or Landlord's Agents during the Lease Term shall be deemed an
acceptance or a surrender of the Premises, and no agreement to accept a
surrender of the Premises shall be valid unless made in writing and signed by
Landlord. The mention in this Lease of any particular remedy shall not
preclude Landlord from any other remedy it might have, either under this
Lease or at law, nor shall the waiver of or redress for any violation of any
covenant or condition in this Lease or in any of the rules or regulations
attached to this Lease or later adopted by Landlord, prevent a subsequent
act, which would have originally constituted a violation, from having all the
force and effect of an original violation. The receipt by Landlord of Base
Rent, Additional Rent, Additional Tenant Improvement Rent, or any other sum
payable under this Lease with knowledge of a breach of any covenant or
condition in this Lease shall not be deemed a waiver of such breach. The
failure of Landlord to enforce any of the rules and regulations attached to
this Lease or later adopted, against Tenant or any other tenant in the
Center, shall not be deemed a waiver. Any waiver by Landlord must be in
writing and signed by Landlord to be effective.
6.7 OFFER TO LEASE. The submission of this Lease to Tenant or its
broker or other agent does not constitute an offer to Tenant to lease the
Premises. This Lease shall have no force or effect until: (a) it is executed
and delivered by Tenant to Landlord; and (b) it is executed and delivered by
Landlord to Tenant.
6.8 FORCE MAJEURE. In the event that Landlord shall be delayed,
hindered in or prevented from the performance of any act or obligation
required under this Lease by reason of acts of God, strikes, lockouts, labor
troubles or disputes, inability to procure or shortage of materials or labor,
failure of power or utilities, delay in transportation, fire, vandalism,
accident, flood, severe weather, other casualty, Governmental Requirements
(including mandated changes in the Plans and Specifications or the Tenant
Improvements resulting from changes in pertinent Governmental Requirements or
interpretations thereof), riot, insurrection, civil commotion, sabotage,
explosion, war, national or local emergency, acts or omissions of others,
including Tenant, or other reasons of a similar or dissimilar nature not
solely the fault of, or under the exclusive control of, Landlord, then
performance of such act shall be excused for the period of the delay and the
period for the performance of any such act shall be extended for the period
equivalent to the period of such delay. In the event that Tenant shall be
delayed, hindered in or prevented from the performance of any act or
obligation required under this Lease (other than any act or obligation of
Tenant required under any Work Agreement), by reason of acts of God, flood,
severe weather, riot, insurrection, or national emergency, then performance
of such act shall be excused for the period of the delay (not to exceed
ninety (90) days) and the period for the performance of any such act shall be
extended for the period equivalent to the period of such delay (not to exceed
ninety (90) days); PROVIDED, however, that under no circumstance shall any
applicable Commencement Date be delayed as a result of the extension of time
for the performance of any act or obligation of Tenant as set forth above.
6.9 LANDLORD'S CONSENT. Unless otherwise provided in this Lease,
whenever Landlord's consent, approval or other action is required under the
terms of this Lease, such consent, approval or action shall be subject to
Landlord's judgment or discretion exercised in good faith and shall be timely
delivered in writing.
6.10 SEVERABILITY; CAPTIONS. If any clause or provision of this Lease
is determined to be illegal, invalid, or unenforceable under present or
future laws, the remainder of this Lease shall not be affected by such
determination, and in lieu of each clause or provision that is determined to
be illegal, invalid or unenforceable, there shall be added as a part of this
Lease a clause or provision as similar in terms to such illegal, invalid or
unenforceable clause or provision as may be possible and be legal, valid and
enforceable. Headings or captions in this Lease are added as a matter of
convenience only and in no way define, limit or otherwise affect the
construction or interpretation of this Lease.
6.11 INTERPRETATION. Whenever a provision of this Lease uses the term
(a) "include" or "including", that term shall not be limiting but shall be
construed as illustrative, (b) "covenant", that term shall include any
covenant, agreement, term or provision, and (c) "at law", that term shall
mean at law or in equity, or both. This Lease shall be given a fair and
reasonable interpretation of the words contained in it without any weight
being given to whether a provision was drafted by one party or its counsel.
25
6.12 INCORPORATION OF PRIOR AGREEMENT; AMENDMENTS. Except for the
Existing Lease, this Lease contains all of the agreements of the parties to
this Lease with respect to any matter covered or mentioned in this Lease, and
no prior agreement or understanding pertaining to any such matter shall be
effective for any purpose. No provision of this Lease may be amended or
added to except by an agreement in writing signed by the parties to this
Lease or their respective successors in interest.
6.13 AUTHORITY. If Tenant is a partnership, company, corporation or
other entity, each individual executing this Lease on behalf of Tenant
represents and warrants to Landlord that he or she is duly authorized to so
execute and deliver this Lease and that all partnership, company, corporation
or other entity actions and consents required for execution of this Lease
have been given, granted or obtained.
6.14 TIME OF ESSENCE. Time is of the essence with respect to the
performance of every covenant and condition of this Lease.
6.15 SURVIVAL OF OBLIGATIONS. Notwithstanding anything contained in this
Lease to the contrary or the expiration or earlier termination of this Lease,
any and all obligations of either party accruing prior to the expiration or
termination of this Lease shall survive the expiration or earlier termination
of this Lease, and either party shall promptly perform all such obligations
whether or not this Lease has expired or terminated. Such obligations shall
include any and all indemnity obligations set forth in this Lease.
6.16 CONSENT TO SERVICE. Tenant irrevocably consents to the service of
process of any action or proceeding at the address of the Premises. Nothing
in this paragraph shall affect the right to serve process in any other manner
permitted by law.
6.17 LANDLORD'S AUTHORIZED AGENTS. No property manager or broker shall
be considered an authorized agent of Landlord to amend, renew or terminate
this Lease or to compromise any of Landlord's claims under this Lease or to
bind Landlord in any manner.
6.18 WAIVER OF JURY TRIAL. Landlord and Tenant agree to waive trial by
jury in any action, proceeding or counterclaim brought by either against the
other on any matter arising out of or relating in any way to this Lease.
6.19 COUNTERPARTS; FACSIMILE SIGNATURES. This Lease may be executed in
counterparts, each of which shall be deemed an original and all of which
shall constitute one and the same instrument. Signatures transmitted by
facsimile shall constitute original signatures, provided that, at the request
of either party, the other party will confirm facsimile-transmitted
signatures by delivering an executed original of this Lease to the requesting
party.
IN WITNESS WHEREOF, this Lease has been executed the day and year first above
set forth.
DESIGNATED ADDRESS FOR LANDLORD: LANDLORD:
0000 XX Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxx 00000 XXXXXXX PROPERTIES, L.P., a
Facsimile: 000-000-0000 California limited partnership
By: Xxxxxxx Properties, Inc., a
Maryland corporation, its
general partner
By: /S/ XXXXX X. XXXX
Name: Xxxxx X. Xxxx
Its: Senior Vice President
26
DESIGNATED ADDRESS FOR TENANT: TENANT:
Integrated Measurement Systems INTEGRATED MEASUREMENT SYSTEMS,
Attn: Xxxxx X. Xxxxxx INC., an Oregon corporation
0000 XX Xxxxxx Xxxxx
Xxxxxxxxx, Xxxxxx 00000
Facsimile: 000-000-0000 By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
WITH COPY TO: Its: President and CEO
Alter Xxxxx Xxxxxx Xxxxxx &
Xxxxxxxx, LLP
Attn: Xxxxxxxxxxx X. Xxxxxxxx
Suite 1800
222 S.W. Columbia
Portland, Oregon 97201-6618
Facsimile: 503-226-0079
EXHIBIT A TO LEASE
LEGAL DESCRIPTION OF LAND
EXHIBIT B TO LEASE
DRAWING SHOWING LOCATION OF THE EXISTING SPACE
EXHIBIT C TO LEASE
[INTENTIONALLY OMITTED]
EXHIBIT D TO LEASE
FORM OF MEMORANDUM OF COMMENCEMENT DATE
Xxxxxxx Properties, L.P., as Landlord, and Integrated Measurement
Systems, Inc., as Tenant, executed that certain Lease Agreement dated as of
_____________________________, 1997 (the "Lease").
The Lease contemplates that upon satisfaction of certain conditions
Landlord and Tenant will agree and stipulate as to certain provisions of the
Lease. All such conditions precedent to that stipulation have been satisfied.
Landlord and Tenant agree as follows:
1. The Commencement Date of the Lease as to the _______ Space is
___________________________________.
2. The Termination Date of the Lease is
___________________________________________.
3. The Premises currently consists of ______________________ rentable
square feet.
4. Base Rent for the _____ Space is as follows:
______________ through __________________;$_______________ per month
______________ through __________________;$_______________ per month
______________ through __________________;$_______________ per month
______________ through __________________;$_______________ per month
5. Tenant's Pro Rata Share is now ________________ percent (_________%).
IN WITNESS WHEREOF, the parties have caused this Memorandum to be duly executed
as of __________________________, 199____.
LANDLORD: TENANT
XXXXXXX PROPERTIES, L.P., a INTEGRATED MEASUREMENT SYSTEMS,
California limited partnership, INC., an Oregon corporation
By: Xxxxxxx Properties, Inc., a
Maryland corporation
Its: General Partner By:
--------------------------
Name:
By: ------------------------
-------------------------- Its:
Name: -------------------------
------------------------
Its:
-------------------------
EXHIBIT E to Lease
RULES AND REGULATIONS
1. No sign, placard, picture, advertisement, name or notice shall be
installed or displayed on any part of the outside or inside of the Buildings or
Land without the prior written consent of the Landlord. Landlord shall have the
right to remove, at Tenant's expense and without notice, any sign installed or
displayed in violation of this rule. All approved signs or lettering on doors
and walls shall be printed, painted, affixed or inscribed at the expense of
Tenant by a person chosen by Landlord.
2. If Landlord objects in writing to any curtains, blinds, shades,
screens or hanging plants or other similar objects attached to or used in
connection with any window or door of the Premises, Tenant shall immediately
discontinue such use. No awning shall be permitted on any part of the Premises.
Tenant shall not place anything against or near glass partitions or doors or
windows which may appear unsightly from outside the Premises.
3. Tenant shall not obstruct any sidewalk, halls, passages, exits,
entrances, elevators, escalators, or stairways of the Buildings. The halls,
passages, exits, entrances, elevators, escalators and stairways are not open to
the general public. Landlord shall in all cases retain the right to control and
prevent access to such areas of all persons whose presence in the judgment of
Landlord would be prejudicial to the safety, character, reputation and interest
of the Land, Buildings and the Buildings' tenants; PROVIDED THAT, nothing in
this Lease contained shall be construed to prevent such access to persons with
whom any Tenant normally deals in the ordinary course of its business, unless
such persons are engaged in illegal activities. Tenant shall not go upon the
roof of the Buildings except as reasonably necessary for the purpose of
undertaking Tenant's maintenance obligations under the Lease.
4. The directory of the Buildings will be provided exclusively for the
display of the name and location of tenants only, and Landlord reserves the
right to exclude any other names therefrom.
5. Except with the written consent of Landlord, no person or persons
other than those approved by Landlord shall be employed by Tenant or permitted
to enter the Buildings for the purpose of cleaning the Premises or Buildings.
Cleaning and janitorial services shall be provided by Tenant. Tenant shall not
cause any unnecessary labor by carelessness or indifference to the good order
and cleanliness of the Premises. Landlord shall not in any way be responsible
to any Tenant for any loss of property on the Premises, however occurring, or
for any damage to any Tenant's property by the janitor or any of Tenant's
Agents.
6. Landlord will furnish Tenant, free of charge, two (2) keys to each
door lock in the Premises. Landlord may make a reasonable charge for any
additional keys. Tenant shall not make or have made additional keys, and Tenant
shall not alter any lock or install a new additional lock or bolt on any door of
its Premises. Tenant, upon the termination of its tenancy, shall deliver to
Landlord the keys of all doors which have been furnished to Tenant, and in the
event of loss of any keys so furnished, shall pay Landlord therefor.
7. If Tenant requires telegraphic, telephonic, computer circuits, burglar
alarm or similar services, it shall first obtain, and comply with, Landlord's
instructions for their installation, and shall pay the entire cost of such
installation(s).
8. Tenant shall not place a load upon any floor of the Premises which
exceeds the load per square foot which such floor was designed to carry and
which is allowed by Governmental Requirements. Landlord shall have the right to
prescribe the weight, size and position of all equipment, materials, furniture
or other property brought into the Buildings. Heavy objects shall, if
considered necessary by Landlord, stand on such platforms as determined by
Landlord to be necessary to properly distribute the weight. Business machines
and mechanical equipment belonging to Tenant, which cause noise or vibration
that may be transmitted to the structure of the Buildings or to any space in the
Buildings or to any other tenant in the Buildings, shall be placed and
maintained by Tenant, at Tenant's expense, on vibration eliminators or other
devices sufficient to eliminate noise or vibration. The persons employed to
move such equipment in or out of the Buildings must be acceptable to Landlord.
Landlord will not be responsible for loss of, or damage to, any such equipment
or other property from any cause, and all damage done to the Buildings by
maintaining or moving such equipment or other property shall be repaired at the
expense of Tenant.
9. Tenant shall not use or keep in the Premises any kerosene, gasoline or
inflammable or combustible fluid or material other than those limited quantities
permitted by the Lease. Tenant shall not use or permit to be used in the
Premises any foul or noxious gas or substance, or permit or allow the Premises
to be occupied or used in a manner offensive or objectionable to Landlord or
other occupants of the Buildings by reason of noise, odors or vibrations nor
shall Tenant bring into or keep in or about the Premises any birds or animals.
10. Tenant shall not use any method of heating or air-conditioning other
than that supplied by Landlord.
11. Tenant shall not waste any utility provided by Landlord and agrees to
cooperate fully with Landlord to assure the most effective operation of the
Buildings' heating and air-conditioning and to comply with any governmental
energy-saving rules, laws or regulations of which Tenant has actual notice.
12. Landlord reserves the right, exercisable without notice and without
liability to Tenant, to change the name and street address of the Buildings.
1
13. Landlord reserves the right to exclude from the Buildings between the
hours of 6 p.m. and 7 a.m. the following day, or such other hours as may be
established from time to time by Landlord, and on Sundays and legal holidays,
any person unless that person is known to the person or employee in charge of
the Buildings and has a pass or is properly identified. Tenant shall be
responsible for all persons for whom it requests passes and shall be liable to
Landlord for all acts of such persons. Landlord shall not be liable for damages
for any error with regard to the admission to or exclusion from the Buildings of
any person. Landlord reserves the right to prevent access to the Buildings in
case of invasion, mob, riot, public excitement or other commotion by closing the
doors or by other appropriate action.
14. Tenant shall close and lock the doors of its Premises and entirely
shut off all water faucets or other water apparatus, and electricity, gas or air
outlets before Tenant and its employees leave the Premises. Tenant shall be
responsible for any damage or injuries sustained by other tenants or occupants
of the Buildings or by Landlord for noncompliance with this rule.
15. Tenant shall not obtain for use on the Premises ice, drinking water,
food, beverage, towel or other similar services, except at such hours and under
such regulations as may be fixed by Landlord.
16. The toilet rooms, toilets, urinals, wash bowls and other apparatus
shall not be used for any purpose other than that for which they were
constructed and no foreign substance of any kind whatsoever shall be deposited
in them. The expenses of any breakage, stoppage or damage resulting from the
violation of this rule shall be borne by Tenant if it or its employees or
invitees shall have caused it.
17. Tenant shall not sell, or permit the sale at retail, of newspapers,
magazines, periodicals, theater tickets or any other goods or merchandise to the
general public in or on the Premises. Tenant shall not make any room-to-room
solicitation of business from other tenants in the Buildings. Tenant shall not
use the Premises for any business or activity other than that specifically
provided for in the Lease.
18. Tenant shall not install any radio or television antenna, loudspeaker
or other device on the roof or exterior walls of the Buildings. Tenant shall
not interfere with radio or television broadcasting or reception from or in the
Buildings or elsewhere.
19. Tenant shall not xxxx, drive nails, screws or drill into the
partitions, woodwork or plaster or in any way deface the Premises. Landlord
reserves the right to direct electricians as to where and how telephone and
telegraph wires are to be introduced to the Premises. Tenant shall not cut or
bore holes for wires. Tenant shall not affix any floor covering to the floor of
the Premises in any manner except as approved by Landlord. Tenant shall repair
any damage resulting from noncompliance with this rule.
20. Canvassing, soliciting and distribution of handbills or any other
written material, and peddling in the Buildings or Land are prohibited, and
Tenant shall cooperate to prevent the same.
21. Landlord reserves the right to exclude or expel from the Buildings and
Land any person who, in Landlord's judgment, is intoxicated, under the influence
of liquor or drugs or in violation of any of these Rules and Regulations.
22. Tenant shall store all of its trash and garbage within the Premises.
Tenant shall not place in any trash box or receptacle any material which cannot
be disposed of in the ordinary and customary manner of trash and garbage
disposal. All garbage and refuse disposal shall be made in accordance with
directions issued from time to time by Landlord.
23. The Premises shall not be used for lodging or any improper or immoral
or objectionable purpose. No cooking (other than reasonable "break room"
cooking) shall be done or permitted by Tenant, except that use by Tenant of
Underwriters' Laboratory approved equipment for brewing coffee, tea, hot
chocolate and similar beverages shall be permitted; PROVIDED THAT, such
equipment and its use is in accordance with all Governmental Requirements.
24. Tenant shall not use in the Premises or in the public halls of the
Buildings any hand truck except those equipped with rubber tires and side guards
or such other material-handling equipment as Landlord may approve. Tenant shall
not bring any other vehicles of any kind into the Buildings.
25. Without the prior written consent of Landlord, Tenant shall not use
the name of the Buildings in connection with or in promoting or advertising the
business of Tenant except as Tenant's address.
26. Tenant shall comply with all safety, fire protection and evacuation
procedures and regulations established by Landlord or any governmental agency.
27. Tenant assumes any and all responsibility for protecting the Premises
from theft, robbery and pilferage, which includes keeping doors locked and other
means of entry to the Premises closed.
28. The requirements of Tenant will be attended to only upon appropriate
application to the Manager of the Buildings by an authorized individual.
Employees of Landlord are not required to perform any work or do anything
outside of their regular duties unless under special instructions from Landlord,
and no employee of Landlord is required to admit Tenant to any space other than
the Premises without specific instructions from Landlord.
29. Tenant shall not park its vehicles in any parking areas designated by
Landlord as areas for parking by visitors to the Buildings or Land. Tenant
shall not leave vehicles in the parking areas overnight nor park any vehicles in
the Buildings parking areas other than automobiles, motorcycles, motor driven or
nonmotor driven bicycles or four-wheeled trucks.
2
30. Landlord may waive any one or more of these Rules and Regulations for
the benefit of Tenant or any other tenant, but no such waiver by Landlord shall
be construed as a waiver of such Rules and Regulations in favor of any other
person, nor prevent Landlord from thereafter revoking such waiver and enforcing
any such Rules and Regulations against any or all of the tenants of the
Buildings.
31. These Rules and Regulations are in addition to, and shall not be
construed to in any way modify or amend, in whole or in part, the covenants and
conditions of any lease of premises in the Buildings. If any provision of these
Rules and Regulations conflicts with any provision of the Lease, the terms of
the Lease shall prevail.
32. Landlord reserves the right to make such other and reasonable Rules
and Regulations as, in its judgment, may from time to time be needed for safety
and security, the care and cleanliness of the Buildings and Land and the
preservation of good order in the Buildings. Tenant agrees to abide by all the
Rules and Regulations stated in this exhibit and any additional rules and
regulations which are so made by Landlord.
33. Tenant shall be responsible for the observance of all of the foregoing
rules by Tenant and Tenant's Agents.
3
EXHIBIT F TO LEASE
DESCRIPTION OF PERMITTED EXTERIOR SIGNS
EXHIBIT G TO LEASE
DRAWING SHOWING LOCATION OF BIT SPACE
EXHIBIT H TO LEASE
DRAWING SHOWING LOCATION OF MAGNI SPACE
EXHIBIT I TO LEASE
DRAWING SHOWING LOCATION OF NCD SPACE
EXHIBIT J TO LEASE
DRAWING SHOWING LOCATION OF STREAM SPACE
EXHIBIT K TO LEASE
DRAWING SHOWING LOCATION OF CENTER
1
EXHIBIT L TO LEASE
WORK AGREEMENT
SECTION 1. GENERAL
1.1 Landlord agrees to provide funding for certain Tenant Improvements in
the applicable Space subject to the terms and conditions of this Work Agreement.
Landlord shall pay up to the applicable Tenant Improvement Allowance (the "TI
Allowance") towards the cost of designing and constructing the Tenant
Improvements in the applicable Space pursuant to the terms and conditions of
this Work Agreement. All costs in connection with the design and construction
of the Tenant Improvements in the applicable Space in excess of the TI Allowance
shall be paid for by Tenant pursuant to paragraph 3.9, below. Throughout the
process of design and construction of the Tenant Improvements, Xxxxx Xxxxxx
("Tenant's Construction Representative") shall be available for on site and
telephone consultations and decisions as necessary. Tenant's Construction
Representative's address is 0000 XX Xxxxxx Xxxxx, Xxxxxxxxx, XX 00000, and his
telephone number is (000) 000-0000. Tenant's Construction Representative shall
have the authority to bind Tenant as to all matters relating to the Tenant
Improvements.
1.2 Any disbursement of funds from the TI Allowance shall be subject to
the following general conditions set forth in this paragraph 1.2 and to any
other applicable conditions set forth in this Work Agreement. Each of such
conditions is a condition precedent to each and every such disbursement and to
Landlord's obligation to make such disbursement. Each of such conditions is for
the sole benefit of Landlord and may by waived only by Landlord in writing.
(a) There shall be no Event of Default by Tenant under the Lease
(including this Work Agreement) and there shall have occurred no act or omission
which, with the passage of time or the giving of notice, or both, would become
an Event of Default by Tenant under the Lease (including this Work Agreement);
and
(b) At no point in time shall any one or more assignees or subtenants
of Tenant have been in possession, in the aggregate, of more than 15,000 square
feet of the Premises, or have been in possession of any portion of the Premises
pursuant to an assignment or sublease with a term (including exercised
extensions) exceeding twenty-four (24) months (except that an assignment or
sublease of up to 6,000 square feet of the Premises to Cadence, or as permitted
pursuant to the terms of paragraph 4.16.7, shall not be counted toward the
15,000 square foot maximum or the 24-month term limitation). For purposes of
this subparagraph 1.2(b) only, the term "assignment or sublease" shall not
include any assignment or sublease (i) executed after the date (the "Exercise
Date") upon which Tenant exercises its option, right of first refusal, or right
of first offer, as the case may be, to lease the applicable Space, and (ii) the
terms and conditions of which had not been substantially agreed upon by Tenant
and said assignee or sublessee prior to the Exercise Date.
SECTION 2. DESIGN OF TENANT IMPROVEMENTS
2.1 Tenant shall select and propose for Landlord's approval a space
planner, engineer or architect (the "Design Professional") to prepare the
necessary drawings, including without limitation basic plans and Working Plans
as described below for construction of the Tenant Improvements. Landlord shall
have ten (10) Business Days within which to approve or reject such Design
Professional. If Landlord rejects Tenant's proposed Design Professional,
Landlord shall, at the time it notifies Tenant of such rejection, provide Tenant
with a list of no fewer than three (3) alternate design professionals, and
Tenant shall have ten (10) Business Days after receipt of such list to retain
one of the listed alternates to render the services described in the first
sentence of this paragraph 2.1. If Landlord approves Tenant's proposed Design
Professional, Tenant shall retain such Design Professional to render the
services described in the first sentence of this paragraph 2.1. The Tenant's
agreement with the Design Professional shall provide that in no event shall such
Design Professional assert or claim any lien, encumbrance or charge against the
Land, Buildings or Premises. The fees of such Design Professional shall be
either paid by Tenant or, if paid by Landlord, charged against the TI Allowance.
Tenant shall cause to be clearly identified and located on the basic plans any
equipment requiring special plumbing or mechanical systems, areas subject to
above normal loads, special openings in the floor, ceiling, or walls, and other
major or special features, and locations of telephone and electrical
receptacles, outlets, and other
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items requiring electrical power (for special conditions, equipment, power
requirements, and manufacturer's model numbers must be included).
2.2 Within ten (10) Business Days after Tenant delivers to Landlord a copy
of the basic plans, Landlord shall either approve the basic plans or shall set
out the revisions to the basic plans reasonably required by Landlord. Tenant's
Design Professional shall, within ten (10) Business Days, incorporate Landlord's
required revisions, and produce full working drawings for construction
sufficient to obtain all necessary permits and with sufficient detail to
construct the Tenant Improvements, including specifications for every item
included thereon (the "Working Plans").
SECTION 3. CONSTRUCTION OF TENANT IMPROVEMENTS
3.1 Upon completion of the Working Plans, and unless Landlord has approved
of having the Tenant Improvements constructed by a contractor of Tenant's
choosing (as set forth below), Landlord shall solicit competitive bids from
contractors for construction of the Tenant Improvements pursuant to the Working
Plans. Landlord shall not be absolutely required to accept the lowest bid, but
may, with Tenant's approval (which will not be unreasonably withheld or
delayed), accept the bid of any contractor that Landlord, in its reasonable
judgment, believes will construct higher quality Tenant Improvements in a timely
manner and at a reasonable cost compared to the lower bidder(s). At the request
of Tenant, Landlord or its contractor shall provide to Tenant in writing a fixed
price bid for the cost of improvements to be provided at Tenant's expense
pursuant to Section 1 of this Work Agreement. Within five (5) Business Days
after Tenant's receipt of such estimated cost, Tenant shall delete any items
which Tenant elects not to have constructed and shall authorize construction of
the balance of the Tenant Improvements. In the absence of such written
authorization, Landlord shall not be obligated to commence work on the Tenant
Improvements and Tenant shall be responsible for any costs due to any resulting
delay in completion of the Tenant Improvements.
Within three (3) Business Days of completion of the Working Plans, Tenant
may notify Landlord that Tenant requests Landlord's permission to use a
contractor of Tenant's choosing for the construction of the Tenant Improvements.
Such request shall include a proposed detailed budget and time schedule for the
Tenant Improvements and a listing and description of the contractor and each
subcontractor which Tenant proposes for such work. Landlord shall approve or
reject Tenant's request within ten (10) Business Days. If Landlord approves
Tenant's request to use its own contractor, then (i) the work performed by such
contractor and any subcontractors shall be in conformance with the requirements
of paragraph 3.4 of this Work Agreement, and (ii) any disbursement of funds to
Tenant from the TI Allowance shall be subject to the additional conditions set
forth in paragraph 3.5 of this Work Agreement.
3.2 If Landlord's contractor is to construct the Tenant Improvements, then
prior to commencement of construction of the Tenant Improvements, Tenant shall
either (i) deposit with Landlord cash in an amount equal to the estimated cost
of the Tenant Improvements to be installed at Tenant's expense pursuant to
Section 1 of this Work Agreement, or (ii) provide Landlord with other evidence
or assurance satisfactory to Landlord, such as a bond, of Tenant's ability to
pay the estimated cost of such Tenant Improvements. Landlord's contractor shall
then complete the Tenant Improvements without material deviation from the
Working Plans. If cash is deposited by Tenant as provided above in this
paragraph 3.2, any excess paid by Tenant over the actual cost of the Tenant
Improvements shall be promptly refunded without interest to Tenant by Landlord.
Notwithstanding the preceding sentences of this paragraph, if Tenant qualifies
for and elects to use the additional Tenant Improvement allowance described in
paragraph 3.5 of the Lease for the purpose of covering the cost of Tenant
Improvements in excess of the TI Allowance, Tenant shall not be required to
comply with clauses (i) or (ii) of this paragraph, but instead shall be required
to acknowledge in writing the amount of additional Tenant Improvement allowance
utilized under paragraph 3.5 of the Lease and Tenant's agreement to pay the
specified amount of Additional Tenant Improvement Rent.
3.3 If Tenant desires any changes to the Tenant Improvements, Tenant shall
submit a written request for such change to Landlord, together with all plans
and specifications necessary to show and explain changes from the approved
Working Plans. Any such change shall be subject to Landlord's reasonable
approval. Within seven (7) Business Days after Tenant delivers to Landlord the
written change request, Landlord shall either approve the change request, deny
the change request, or set out the revisions to the change request reasonably
required by Landlord. If Landlord's contractor is constructing the Tenant
Improvements, Landlord or such contractor shall notify Tenant in writing of the
amount, if any, which will be charged or credited to Tenant to reflect the cost
of such change. Any such change order shall not be final until approved by
Tenant.
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3.4 If any work in connection with the Tenant Improvements is authorized
to be performed by Tenant's contractor as provided in paragraph 3.1 of this Work
Agreement, such work shall conform to each of the following requirements:
(a) Such work shall proceed only upon Landlord's written approval of
the public liability and property damage insurance carried by Tenant's
contractor. Landlord shall have the right to require Tenant's contractor to
post a payment or performance bond in an amount equal to the estimated cost of
the work to be performed by such contractor. Tenant shall supply Landlord with
the name, address, and emergency telephone number for Tenant's contractor and
all subcontractors with respect to Tenant's contractor.
(b) All such work shall be (i) done in conformity with a valid
building permit when required, a copy of which shall be furnished to Landlord
before such work is commenced, (ii) completed in accordance with the Working
Plans which have been approved by Landlord, (iii) completed in accordance with
all Governmental Requirements, (iv) consist of all new materials or other
materials approved by Landlord, (v) performed in accordance with all applicable
safety regulations established by Landlord or its Manager for the Center
generally, and (vi) free of defects in materials and workmanship.
Notwithstanding any failure by Landlord to object to any such work, Landlord
shall have no responsibility for Tenant's failure to comply with all applicable
Governmental Regulations.
(c) All contractors constructing or installing any such work and the
respective subcontractors to each and every such contractor (i) shall be
licensed for their respective trades and (ii) shall be approved by Landlord.
(d) All such work shall be scheduled through Landlord or its Manager
and shall be performed in a manner and at times which do not impede or delay any
work on the applicable Space or any other space in the Center being performed by
Landlord's contractor.
(e) Tenant's contractor shall store any materials only in the
Premises or in such other space as may be designated by Landlord or its
contractor from time to time. All trash and surplus construction materials
shall also be stored within the Premises and shall be promptly removed from the
Premises.
(f) As between Landlord and Tenant, Tenant shall be directly
responsible for all payments to or for the account of Tenant's contractor and
all subcontractors retained by Tenant's contractor. From the applicable TI
Allowance, Landlord shall reimburse Tenant for actual costs and fees expended
within ten (10) Business Days after receipt by Landlord of Tenant's invoice for
such reimbursement and satisfaction of all other conditions to a disbursement
under this Work Agreement, but in any event no more often than monthly, up to
the amount of the applicable TI allowance. Tenant shall provide Landlord with
copies of all current invoices and payment receipts each time Tenant invoices
Landlord for reimbursement. Tenant shall not permit any mechanics or
materialman's liens, arising from or related to Tenant Improvements constructed
by Tenant's contractor, to be created against the Land, Buildings or Premises.
Tenant shall use sums disbursed from the TI Allowance exclusively for the
particular category or line item of Tenant Improvements identified in Tenant's
request. During the course of construction of the Tenant Improvements, Tenant
shall file and submit all applications and obtain and maintain in force all
permits, variances, licenses, approvals and other authorizations as are required
by Governmental Requirements. Tenant shall promptly deliver to Landlord copies
of all such documents to Landlord.
(g) During the course of construction of the Tenant Improvements,
Tenant shall promptly notify Landlord upon (i) any stoppage or material delay in
construction work, (ii) any notice or other communication delivered to Tenant or
within Tenant's knowledge to the effect that the Tenant Improvements are not
being constructed in accordance with Governmental Requirements, the Working
Plans approved by Landlord, the budget or time schedule submitted to Landlord
under paragraph 3.1 of this Work Agreement, or any other requirements of this
Work Agreement, (iii) Tenant's receipt of any notice from any party, other than
Landlord, alleging that Tenant is in default of any of its obligations under any
construction contract, architecture or engineering contract, or any other
contract relating to the Tenant Improvements, (iv) any material casualty
occurring to any part or item of the Tenant Improvements, (vi) Tenant's
knowledge of any violation of subparagraph 4.20.1 of the Lease.
(h) At anytime during the course of construction of the Tenant
Improvements, Landlord may, but shall have no obligation to, pay any of Tenant's
contractors or subcontractors directly out of the TI Allowance.
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If any work is to be performed in connection with the Tenant Improvements
by Landlord's contractor, such work shall conform to the requirements of clause
(b) above.
3.5 If any work in connection with the Tenant Improvements is authorized
to be performed by Tenant's contractor as provided in paragraph 3.1 of this Work
Agreement, then any disbursement of funds to Tenant from the TI Allowance shall
be subject to the following additional conditions. Each of such additional
conditions is a condition precedent to each and every such disbursement and to
Landlord's obligation to make such disbursement. Each of such conditions is for
the sole benefit of Landlord and may by waived only by Landlord in writing.
(a) Landlord shall have received evidence satisfactory to Landlord
showing such bills, receipts, invoices and other evidence as may be required by
Landlord to substantiate Tenant's unconditional obligation for the sums covered
by the current request;
(b) Landlord shall have received lien waivers (conditioned only on
receipt of the specified sums) in recordable form for all work covered by the
current request and otherwise be satisfied that there are no liens, encumbrances
or defects filed or asserted in writing arising from or relating to the design
or construction of the Tenant Improvements;
(c) Landlord shall be satisfied that no Hazardous Substances have
been constructed, deposited, disposed, placed, buried, discharged, generated,
treated, handled or located in, on, about, under or around the Land or Buildings
in connection with the Tenant Improvements;
(d) Amounts included in any previous disbursement of the TI Allowance
for a specified purpose shall not have been applied to any other purpose or
payment;
(e) Landlord shall be satisfied that there is no pending or
threatened litigation or proceeding affecting the Land, Buildings, Landlord or
Tenant in connection with or arising out of the Tenant Improvements;
(f) Tenant shall have furnished Landlord with evidence satisfactory
to Landlord that the insurance coverages and any payment or performance bond
required for Tenant's contractors by this Work Agreement remain in force and
effect;
(g) Landlord shall be satisfied that all construction work covered by
the current request has been performed and completed in accordance with this
Work Agreement; and
(h) Landlord shall have received such other information and
documentation as may reasonably be required by Landlord.
3.6 Without limiting the general applicability of the Tenant Improvement
Allowance, any fees for overhead or supervision of Tenant Improvement design or
construction up to a maximum of five percent (5%) of total hard construction
costs, including those of Landlord or Manager, shall be charged against the
Tenant Improvement Allowance, so long as they are reasonably consistent with
industry standards and subject to Tenant's prior reasonable written approval.
In addition, data and phone distribution costs of up to $1.00 per square foot of
the applicable Space may be charged against the Tenant Improvement Allowance,
and all construction permit costs shall be charged against the Tenant
Improvement Allowance.
3.7 Tenant's entry in the applicable Space for any purpose, including
without limitation inspection or performance of work by Tenant's contractor,
prior to the applicable Commencement Date, shall be subject to all the terms and
conditions of the Lease, including without limitation the provisions of the
Lease relating to the maintenance of insurance, but excluding the provisions of
the Lease relating to the payment of rent. Tenant's entry shall mean entry by
Tenant or any of Tenant's Agents.
3.8 Each party shall indemnify and hold harmless the other from and
against any and all Claims arising in whole or in part out of or in any way
related to any act, omission or negligence of such party's contractors (and any
subcontractors thereof) in the Premises, the Buildings or at the Center.
Without limiting the generality of the foregoing, the indemnifying party shall
promptly reimburse the other party upon demand for any extra expense incurred by
such party as a result of faulty work done by the indemnifying party or its
contractors or subcontractors
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thereof, any delays caused by such work, or inadequate clean-up. Landlord's
indemnification obligation under this paragraph is subject to terms of
paragraph 4.27 of the Lease.
3.9 If the cost of the Tenant Improvements exceeds the TI Allowance plus
any additional Tenant Improvement allowance made available under the terms and
conditions of paragraph 3.5 of the Lease, then Tenant shall either (a) pay to
Landlord such excess within twenty (20) Business Days after demand (with
invoices) by Landlord (if Landlord's contractor constructed the Tenant
Improvements), or (b) not be entitled to reimbursement of the costs incurred by
Tenant in excess of the TI Allowance (if Tenant's contractor constructs the
Tenant Improvements). If Tenant fails to pay to Landlord the cost of any such
excess Tenant Improvements as and when due, Landlord may elect to suspend work
on the Tenant Improvements pending payment in full.
3.10 Upon the expiration or sooner termination of the Lease, all Tenant
Improvements and all additions or alterations to the Premises made by Tenant or
performed by Landlord on Tenant's behalf, shall become the property of Landlord
unless Landlord has, as a condition of approving such Tenant Improvements,
required that the same be removed by Tenant at Tenant's sole expense. If Tenant
fails to remove any such Tenant Improvements as required by Landlord's consent,
Landlord may do so and Tenant shall pay the entire cost thereof to Landlord
within thirty (30) days after Tenant's receipt of Landlord's written demand
therefor with invoices.
3.11 In the event that Landlord fails to respond within the time required
to any written request by Tenant for approval or consent required of Landlord
pursuant to the terms of this Work Agreement, and such failure to respond
continues after Tenant delivers written notice to Landlord of such failure to
respond, then Tenant's obligation to pay Base Rent for the applicable Space
during the applicable Lease Term shall be abated one day for each day after
receipt by Landlord of the notice described above during which such failure to
respond continues; PROVIDED, however, that (a) no such delay shall cause any
change in the applicable Commencement Date, and (b) for purposes of this
subparagraph 3.11, Landlord shall have been deemed to have responded if Landlord
conditionally or unconditionally gives its approval or rejection, requests
additional information which is material to the request for approval or consent,
or any combination of the above.
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