ONE MARKET
STANDARD FORM OFFICE LEASE
BETWEEN
ZML-ONE MARKET LIMITED PARTNERSHIP,
A DELAWARE LIMITED PARTNERSHIP ("LANDLORD"),
by its agent, Equity Office Holdings, LLC,
a Delaware limited liability company
AND
TENERA, INC., a Delaware corporation ("TENANT")
TABLE OF CONTENTS
I. BASIC LEASE INFORMATION; DEFINITIONS ........................... 1
II. LEASE GRANT .................................................... 3
III. POSSESSION ..................................................... 3
IV. USE ............................................................ 3
V. RENT ........................................................... 4
VI. SECURITY DEPOSIT ............................................... 4
VII. SERVICES TO BE FURNISHED BY LANDLORD ........................... 5
VIII. LEASEHOLD IMPROVEMENTS ......................................... 6
IX. GRAPHICS ....................................................... 6
X. REPAIRS AND ALTERATIONS BY TENANT .............................. 6
XI. USE OF ELECTRICAL AND HVAC SERVICES BY TENANT .................. 7
XII. ENTRY BY LANDLORD .............................................. 7
XIII. ASSIGNMENT AND SUBLETTING ...................................... 7
XIV. LIENS .......................................................... 8
XV. INDEMNITY AND WAIVER OF CLAIMS ................................. 9
XVI. TENANT'S INSURANCE ............................................. 10
XVII. SUBROGATION .................................................... 11
XVIII. LANDLORD'S INSURANCE ........................................... 11
XIX. CASUALTY DAMAGE ................................................ 11
XX. DEMOLITION ..................................................... 12
XXI. CONDEMNATION ................................................... 12
XXII. EVENTS OF DEFAULT .............................................. 12
XXIII. REMEDIES ....................................................... 13
XXIV. LIMITATION OF LIABILITY ........................................ 14
XXV. NO WAIVER ...................................................... 15
XXVI. EVENT OF BANKRUPTCY ............................................ 15
XXVII. QUIET ENJOYMENT ................................................ 16
XXVIII. RELOCATION ..................................................... 16
XXIX. HOLDING OVER ................................................... 16
XXX. SUBORDINATION TO MORTGAGES ..................................... 16
XXXI. ATTORNEY'S FEES ................................................ 17
XXXII. NOTICE ......................................................... 17
XXXIII. LANDLORD'S LIEN ................................................ 17
XXXIV. EXCEPTED RIGHTS ................................................ 17
XXXV. SURRENDER OF PREMISES .......................................... 18
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XXXVI. MISCELLANEOUS .................................................. 18
XXXVII. ENTIRE AGREEMENT ............................................... 19
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OFFICE LEASE AGREEMENT
This Office Lease Agreement (the "Lease"), is made and entered into as of
the __________ day of __________, 1995, by and between ZML-ONE MARKET LIMITED
PARTNERSHIP, A DELAWARE LIMITED PARTNERSHIP ("Landlord") by its Agent, Equity
Office Holdings, LLC, a Delaware limited liability company, and TENERA, INC.,
A DELAWARE CORPORATION ("Tenant").
I. BASIC LEASE INFORMATION; DEFINITIONS.
A. The following is some of the basic lease information and defined terms
used in this Lease.
1. "Broker" means ComCore Real Estate Services.
2. "Building" shall mean the office building located at One Market,
San Francisco, San Francisco County, State of California, commonly known as
One Market.
3. Landlord is not required to perform Landlord Work (hereinafter
defined) in the Premises and the "Commencement Date," "Lease Term" and
"Termination Date" shall be as set forth in subsection I.A.3.a. below.
a. The "Lease Term" shall mean a period of twenty-six (26) months
commencing on September 1, 1995 (the "Commencement Date") and, unless sooner
terminated as provided herein, ending on October 31, 1997 (the "Termination
Date").
b. INTENTIONALLY OMITTED.
4. "Guarantor(s)" INTENTIONALLY OMITTED.
5. "Landlord Work" shall mean the work, if any, that Landlord is
obligated to perform in the Premises pursuant to the Work Letter Agreement
attached hereto as Exhibit "C."
6. "Notice Addresses" shall mean the following addresses for Tenant
and Landlord, respectively:
Tenant:
Prior to the Commencement Date, notices shall be sent to Tenant at
the following address:
Tenera, Inc.,
0000 Xxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxxxxx
On or after the Commencement Date, notices shall be sent to Tenant
at the Premises, Attention: Xxxx Xxxxxxxx.
Landlord:
Office of the Building
Xxx Xxxxxx
Xxxxx Xxxxxx Xxxxx, Xxxxx 000,
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Building Manager
With a copy to:
Equity Office Holdings, L.L.C.
Two Xxxxx Xxxxxxxxx Xxxxx
Xxxxx 0000
0
Xxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Payments of Rent only shall be made payable
to the order of One Market at the following address:
Office of the Building
Xxx Xxxxxx
Xxxxx Xxxxxx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
7. "Permitted Use" shall mean: General office use.
8. "Premises" shall mean the area located on the eighteenth (18th)
floor of Spear Tower of the Building and outlined on Exhibit A attached hereto
and incorporated herein and known as Suite # 1850.
9. "Project" shall mean the two (2) towers known as Spear Tower and
Xxxxxxx Tower, the land described in the legal description attached hereto as
Exhibit A-2, and all of the improvements located on such land.
10. "Prepaid Rental": Nineteen Thousand Seven Hundred Fifty-Eight and
33/100 Dollars ($19,758.33) payable by Tenant upon execution of this Lease by
Tenant in accordance with Article V hereof.
11. "Rentable Area of the Premises" shall mean the area contained
within the demising walls of the Premises and any other area designated for
the exclusive use of Tenant, without deduction for any columns or projections
necessary to the Building, plus a proportionate share of any Common Areas
located on the floor(s) on which the Premises is located and a proportionate
share of the Building's public areas, management office, engineer's office and
"Mechanical Spaces" i.e. spaces housing service areas, equipment and/or access
corridors for HVAC and communications facilities, plumbing, fire protection
and elevators. The Rentable Area of the Premises is deemed for all purposes
under this Lease to be 9,484 square feet. The "Rentable Area of the Project"
is deemed for all purposes under this Lease to be 1,455,000 square feet. The
square footage amounts set forth for the Rentable Area of the Premises and the
Rentable Area of the Building constitute a material part of the economic basis
of this Lease and the execution thereof by Landlord and shall not be adjusted
without the written consent of Landlord.
12. "Security Deposit" shall mean the sum of $39,516.66. Effective as
of the first anniversary of the Commencement Date and provided there has been
no default under the terms and conditions of the Lease, the Security Deposit
shall be reduced to $19,758.33.
13. "Tenant's Pro Rata Share with respect to Taxes" shall mean six
thousand five hundred eighteen ten-thousandths percent (.6518%), which is the
sum derived by dividing the Rentable Area of the Premises by the Rentable Area
of the Project and multiplying the result thereof by one hundred (100).
14. "Tenant's Pro Rata Share with respect to Expenses" shall mean six
thousand six hundred thirty-eight ten-thousandths percent (.6638%) which is
the sum derived by dividing the Rentable Area of the Premises by the Rentable
Area of the Project (exclusive of 26,213 rentable square feet of storage
space) and multiplying the result thereof by one hundred (100).
B. The following are additional definitions of some of the defined terms
used in the Lease.
1. "Basic Costs" shall mean all direct and indirect costs and
expenses incurred in connection with the Property as more fully defined in
Exhibit B-2.
2. "Building Standard" shall mean the type, grade, brand, quality
and/or quantity of materials Landlord designates from time to time to be the
minimum quality and/or quantity to be used in the Building.
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3. "Business Day(s)" shall mean Mondays through Fridays exclusive of
the normal business holidays ("Holidays") of New Year's Day, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day and Christmas Day, and such
other days as Landlord may designate.
4. "Common Areas" shall mean those areas provided for the common use
or benefit of all tenants generally and/or the public, such as corridors,
elevator foyers, common mail rooms, restrooms, vending areas, and lobby areas
(whether at ground level or otherwise), and other similar facilities.
5. "Maximum Rate" shall mean the greatest per annum rate of interest
permitted from time to time under applicable federal and state law.
6. "Normal Business Hours" for the Building shall mean 8:00 a.m. to
6:00 p.m. Mondays through Fridays, exclusive of Holidays, and such other hours
as Landlord may designate from time to time.
7. "Prime Rate" shall mean the per annum interest rate publicly
announced by The First National Bank of Chicago from time to time (whether or
not charged in each instance) as its prime or base rate.
II. LEASE GRANT. Subject to and upon the terms herein set forth, Landlord
leases to Tenant and Tenant leases from Landlord the Premises.
III. POSSESSION.
A. INTENTIONALLY OMITTED.
B. Subject to the completion or correction of any items of Landlord Work
set forth on a construction punchlist jointly prepared by Landlord and Tenant
in good faith based on a walk through of the Premises within thirty (30) days
after substantial completion, by taking possession of the Premises, Tenant is
deemed to have:
1. accepted the Premises and agreed that the Premises is in good
order and satisfactory condition, with no representation or warranty by
Landlord as to the condition or suitability of the Premises or of the Building
for Tenant's use thereof; and
2. agreed that Landlord has no obligation to clean, decorate, alter,
remodel, improve or repair the Premises or the Building unless said obligation
is specifically set forth in this Lease.
C. INTENTIONALLY OMITTED.
D. If Tenant takes possession of the Premises prior to the Commencement
Date for the purposes of conducting business in the normal course such
possession shall be subject to all the terms and conditions of the Lease, and
Tenant shall pay (a) no Base Rental or Additional Base Rental for each day of
occupancy beginning with August 22, 1995 and ending the day immediately
preceding the Commencement Date, and (b) pay Base Rental and Additional Base
Rental to Landlord on a per diem basis for each day of occupancy prior to
August 22, 1995. If Tenant takes possession of the Premises prior to the
Commencement Date solely for the purposes of storing Tenant's personal
property therein such possession shall be subject to all the terms and
conditions of the Lease and Tenant shall not pay Base Rental or Additional
Base Rental for such storage prior to the Commencement Date.
IV. USE. The Premises shall be used for the Permitted Use and for no other
purpose. Tenant agrees not to use or permit the use of the Premises for any
purpose which is illegal, dangerous to life, limb or property or which, in
Landlord's opinion, creates a nuisance or which would increase the cost of
insurance coverage with respect to the Building. Tenant shall conduct its
business and control its agents, servants, contractors, employees, customers,
licensees, and invitees in such a manner as not to interfere with, annoy or
disturb other tenants, or in any way interfere with Landlord in the management
and operation of the Building. Tenant
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will maintain the Premises in a clean and healthful condition, and comply with
all laws, ordinances, orders, rules and regulations of any governmental entity
with reference to the operation of Tenant's business and to the use,
condition, configuration or occupancy of the Premises, including without
limitation, the Americans with Disabilities Act. Tenant will comply with the
rules and regulations of the Building adopted and altered by Landlord from
time to time and will cause all of its agents, servants, contractors,
employees, customers, licensees and invitees to do so. All changes to such
rules and regulations will be sent by Landlord to Tenant in writing. A copy
of the existing rules and regulations is attached hereto as Exhibit D and made
a part hereof. Tenant agrees not to commit or allow any waste to be committed
on any portion of the Premises, and at the termination of this Lease to
deliver up the Premises to Landlord in accordance with Article XXXV hereof.
V. RENT.
A. Tenant covenants and agrees to pay to Landlord during the Lease Term,
without any setoff or deduction whatsoever, the full amount of all Base Rental
payments, and any adjustments thereof, due in accordance with the rental
schedule set forth in Exhibit B-1 hereof (the "Base Rental"), the full amount
of all payments of Additional Base Rental due in accordance with Exhibit B-2
hereof (the "Additional Base Rental") and all such other sums of money as
shall become due under this Lease (including, without limitation, any charges
for replacement of electric lamps and ballasts and any other services, goods
or materials furnished by Landlord at Tenant's request), all of which
hereinafter may be collectively called "Rent." Except as otherwise provided
herein, the Base Rental and Additional Base Rental for each calendar year or
portion thereof during the Lease Term, shall be due and payable in advance in
equal monthly installments on the first day of each calendar month during the
Lease Term and any extensions or renewals hereof, and Tenant hereby agrees to
pay such Base Rental and Additional Base Rental to Landlord without demand,
provided that the installment of Base Rental for the first full calendar month
of the Lease Term shall be payable upon the execution of this Lease by Tenant.
If the Lease Term commences on a day other than the first day of a month or
terminates on a day other than the last day of a month, then the installments
of Base Rental and Additional Base Rental for such month or months shall be
prorated, based on the number of days in such month. All such payments shall
be by a good and sufficient check. No payment by Tenant or receipt or
acceptance by Landlord of a lesser amount than the correct amount of Rent due
under this Lease shall be deemed to be other than a payment on account of the
earliest Rent due hereunder, nor shall any endorsement or statement on any
check or any letter accompanying any check or payment be deemed an accord and
satisfaction, and Landlord may accept such check or payment without prejudice
to Landlord's right to recover the balance or pursue any other available
remedy. The acceptance by Landlord of any Rent on a date after the due date
of such payment shall not be construed to be a waiver of Landlord's right to
declare a default for any other late payment. Tenant's covenant to pay Rent
shall be independent of every other covenant set forth in this Lease.
B. All Rent not paid when due and payable shall bear interest from the
date due until paid (provided Tenant shall be entitled to a grace period of
five (5) days with respect to the first (1st) late payment in any calendar
year) at the lesser of: 1. eighteen percent (18%) per annum; or 2. the
Maximum Rate. In addition, if Tenant fails to pay any installment of Base
Rental, Additional Base Rental or any other item of Rent when due and payable
hereunder (provided Tenant shall be entitled to a grace period of five (5)
days with respect to the first (1st) late payment in any calendar year), a
service fee equal to five percent (5%) of such unpaid amount will be due and
payable immediately by Tenant to Landlord.
VI. SECURITY DEPOSIT. The Security Deposit shall be delivered to Landlord
upon the execution of this Lease and shall be held by Landlord without
liability for interest (except as required by law) and as security for the
performance of Tenant's obligations under this Lease. The Security Deposit
shall not be considered an advance payment of Rent or a measure of Tenant's
liability for damages. Landlord may, from time to time, without prejudice to
any other remedy, use all or a portion of the Security Deposit to make good
any arrearages of Rent, to repair damages to the Premises caused by Tenant, to
clean the Premises upon
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termination of this Lease or otherwise to satisfy any other covenant or
obligation of Tenant hereunder. Following any such application of the
Security Deposit, Tenant shall pay to Landlord on demand the amount so applied
in order to restore the Security Deposit to its original amount. If Tenant is
not in default at the termination of this Lease, after Tenant surrenders the
Premises to Landlord in accordance with this Lease and all amounts due
Landlord from Tenant are finally determined and paid, the balance of the
Security Deposit remaining after any such application shall be returned to
Tenant. If Landlord transfers its interest in the Premises during the Lease
Term, Landlord may assign the Security Deposit to the transferee and
thereafter shall have no further liability for the return of such Security
Deposit. Tenant agrees to look solely to such transferee or assignee for the
return of the Security Deposit. Landlord and its successors and assigns shall
not be bound by any actual or attempted assignment or encumbrance of the
Security Deposit by Tenant, provided, however, if Tenant's interest in this
Lease has been assigned, Landlord may, at its option, and provided the
assignee provides Landlord with written evidence of such assignment, return
the Security Deposit to such assignee, provided further that the assignee has
complied with the other terms of this paragraph. If Landlord elects to return
the Security Deposit to Tenant's assignee as aforesaid, Landlord will have no
further obligation to the original tenant with respect thereto. Landlord
shall not be required to keep the Security Deposit separate from its other
accounts.
VII. SERVICES TO BE FURNISHED BY LANDLORD.
A. Subject to the provisions of Article XI below, Landlord, as part of
Basic Costs, agrees to furnish Tenant the following services:
1. Cold water at those points of supply provided for general use of
tenants in the Building, central heat and air conditioning in season, at such
temperatures and in such amounts as are considered by Landlord to be standard
for buildings of similar class, size, age and location, or as required by
governmental authority; provided, however, heating and air conditioning
service at times other than for Normal Business Hours for the Building shall
be furnished only upon the written request of Tenant delivered to Landlord at
the office of the Building prior to 3:00 p.m. at least one Business Day in
advance of the date for which such usage is requested. Tenant shall pay
Landlord, upon demand as additional rent, the entire cost of additional
service as such costs are determined by Landlord from time to time.
2. Routine maintenance and electric lighting service for all Common
Areas of the Building in the manner and to the extent deemed by Landlord to be
standard for buildings of similar class, size, age and location.
3. Janitor service on Business Days; provided, however, if Tenant's
use, floor covering or other improvements require special services, Tenant
shall, at Landlord's option, either (i) retain its own contractors (which
contractor shall be subject to Landlord's reasonable approval) to do such work
or, (ii) pay the additional cost reasonably attributable thereto as additional
Rent upon presentation of statements therefor by Landlord.
4. Elevator service in common with other tenants of the Building for
ingress and egress to and from the floor of the Premises during Normal
Business Hours.
B. Except as otherwise expressly provided herein, the failure by Landlord
to any extent to furnish, or the interruption or termination of these services
in whole or in part, resulting from adherence to laws, regulations and
administrative orders, wear, use, repairs, improvements, alterations, Force
Majeure (as hereinafter defined) or any causes beyond the reasonable control
of Landlord shall not render Landlord liable in any respect nor be construed
as an eviction of Tenant, nor give rise to an abatement of Rent, nor relieve
Tenant from the obligation to fulfill any covenant or agreement hereof.
Notwithstanding anything to the contrary contained in this Section VII.B. if
(i) Landlord ceases to furnish any service in the Building, and Tenant
notifies Landlord of such cessation in writing (the "Interruption Notice"),
(ii) such cessation does not arise as a result of an act or omission of
Tenant, (iii) such cessation is not caused by a fire or other casualty (in
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which case Article XIX shall control), (iv) the repair or restoration of such
service is reasonably within the control of Landlord, and (v) as a result of
such cessation, the Premises or a material portion thereof, is rendered
untenantable (meaning that Tenant is unable to use the Premises in the normal
course of its business) and Tenant in fact ceases to use the Premises, or
material portion thereof, then, Tenant's sole remedy for such cessation shall
be as follows: on the fifth (5th) consecutive business day following the
later to occur of the date the Premises (or material portion thereof) becomes
untenantable, the date Tenant ceases to use such space and the date Tenant
provides Landlord with an Interruption Notice, the Base Rental and Additional
Base Rental payable hereunder shall be abated on a per diem basis for each day
after such five (5) business day period based upon the percentage of the
Premises so rendered untenantable and not used by Tenant, and such abatement
shall continue until the date the Premises become tenantable again. Should
any of the equipment or machinery used in the provision of such services for
any cause cease to function properly, Landlord shall use reasonable diligence
to repair such equipment or machinery, but except as otherwise expressly
provided herein, Tenant shall have no claim for offset or abatement of Rent or
damages on account of an interruption in service or resulting therefrom.
Landlord's entire obligation with respect to the repair and maintenance of the
Premises are set forth above.
C. Tenant expressly acknowledges that if Landlord, from time to time,
elects to provide security services, Landlord shall not be deemed to have
warranted the efficiency of such security personnel, service, procedures or
equipment and Landlord shall not be liable in any manner for the failure of
any such security personnel, services, procedures or equipment to prevent or
control, or apprehend any one suspected of personal injury or property damage
in, on or around the Property.
VIII. LEASEHOLD IMPROVEMENTS.
A. Except as otherwise specifically provided elsewhere in this Lease or
in the Work Letter Agreement, if any, attached hereto as Exhibit C and
incorporated herein, all installations and improvements now or hereafter
placed on or in the Premises by Landlord shall be for Tenant's account and at
Tenant's cost, which cost shall be payable by Tenant to Landlord upon demand
as additional Rent.
B. Any and all alterations, additions and improvements to the Premises,
all attached furniture, equipment and non-trade fixtures (collectively,
"Leasehold Improvements") shall be owned and insured by Landlord and shall
remain upon the Premises, all without compensation, allowance or credit to
Tenant. Any unattached and movable equipment or furniture, trade fixtures or
other personalty of Tenant ("Tenant's Property") shall be owned and insured by
Tenant. Landlord may, nonetheless, require Tenant to remove any Leasehold
Improvements performed by or for the benefit of Tenant and all electronic,
phone and data cabling as are designated by Landlord (the "Required
Removables") at Tenant's sole cost. In the event that Landlord so elects,
Tenant shall remove such Required Removables on or before the expiration or
earlier termination of this Lease and repair any damage caused by such
removal. If Tenant fails to remove the Required Removables after Landlord's
request therefor, Landlord may remove, store or dispose of the Required
Removables at Tenant's cost, and repair any damage caused by such removal and
Tenant shall pay Landlord as additional Rent hereunder, on demand, all such
costs. Landlord shall not require Tenant to remove any usual office
improvements such as gypsum board, partitions, ceiling grids and tiles,
fluorescent lighting panels, building standard doors and carpeting.
IX. GRAPHICS. Landlord shall provide and install, at Tenant's cost which may
be paid out of the Work Allowance (defined in Exhibit C), all letters or
numerals on the exterior of the Premises; all such letters and numerals shall
be in the standard graphics for the Building and no others shall be used or
permitted on the Premises without Landlord's prior written consent.
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X. REPAIRS AND ALTERATIONS BY TENANT.
A. Tenant shall, at Tenant's own cost and expense, keep the Premises in
good condition and repair. Such repairs shall restore the Premises to as good
a condition as it was in prior to such damage and shall be effected in
compliance with the reasonable directions of Landlord. If Tenant fails to
make such repairs to the Premises promptly, Landlord may, at its option, make
such repairs, and Tenant shall pay the cost thereof to the Landlord on demand
as additional Rent.
B. Tenant shall not make or allow to be made any alterations, additions
or improvements to the Premises, nor install any vending machines, safes or
other heavy property or equipment within the Premises, nor place signs or
window coverings on the Premises which are visible from outside the Premises,
without first obtaining the written consent of Landlord in each such instance.
Except with regard to requests for consent or approval that require Landlord
to make a determination of the aesthetics of certain signage, alterations or
other things that would be visible form outside the Premises or Building or to
assume certain risks, including, without limitation, the risk that a certain
alteration, addition and/or improvement could adversely affect the mechanical
systems or structure of the Building or require excess removal costs, Landlord
agrees to act reasonably in granting its approval or disapproval of any
requests by Tenant for the consent or approval of Landlord. Prior to
commencing any such work, Tenant must furnish Landlord with plans and
specifications; names and addresses of contractors; copies of contracts;
necessary permits; evidence of contractor's and subcontractor's insurance in
accordance with section XVI.B. hereof; and indemnification in form and amount
satisfactory to Landlord. All such improvements, alterations or additions
shall be installed in a good workmanlike manner using new materials. Upon
completion, Tenant shall furnish "as-built" plans, contractor's affidavits and
full and final waivers of lien and receipted bills covering all labor and
materials. All improvements, alterations and additions shall comply with all
insurance requirements, codes, ordinances, laws and regulations, including
without limitation, the Americans with Disabilities Act. Tenant shall
reimburse Landlord upon demand as additional Rent for all sums expended by
Landlord for examination of the architectural, mechanical, electric and
plumbing plans for any alterations, additions or improvements and for the
costs of repairing any damage done to the Building caused by Tenant or
Tenant's agents, servants, employees, customers, licensees, or invitees. If
Landlord so requests, Tenant shall permit Landlord to supervise construction
operations, but no such supervision shall impose any liability upon Landlord.
In the event Landlord supervises such construction, Landlord shall be entitled
to a supervisory fee in the amount of fifteen percent (15%) of the cost of
such construction. Landlord's approval of Tenant's plans and specifications
or supervision of any work performed for or on behalf of Tenant shall not be
deemed to be a representation by Landlord that such plans and specifications
comply with applicable insurance requirements, building codes, ordinances,
laws or regulations.
XI. USE OF ELECTRICAL AND HVAC SERVICES BY TENANT.
A. All electricity used by Tenant in the Premises shall, at Landlord's
option, be paid for by Tenant through inclusion in Base Rental or Basic Costs.
Tenant's use of electrical and heating, ventilating and air conditioning
("HVAC") services furnished by Landlord shall not exceed, either in voltage,
rated capacity, use or overall load, that which Landlord deems to be standard
for the Building. In the event Tenant shall request that it be allowed to
consume electrical or HVAC services in excess of that deemed by Landlord to be
standard for the Building, Landlord may refuse to consent to such usage or may
consent upon such conditions as Landlord elects (including the installation of
utility service upgrades, submeters, air handlers or cooling units), and all
such additional usage (to the extent permitted by law), installation and
maintenance thereof shall be paid for by Tenant as additional Rent. Landlord
shall have the right to separately meter electrical usage for the Premises at
any time during the Lease Term or to use any other method of measuring
electrical usage that Landlord, in its reasonable judgment, deems to be
appropriate.
B. If Landlord generates or distributes electric current for the
Building, Tenant shall obtain all current from Landlord and pay as additional
Rent Landlord's charges therefor, provided, however, that if the cost of
providing electricity is not
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included in Base Rental or Basic Costs, the charges to Tenant shall not exceed
the rate that would be charged Tenant if billed directly by the local utility
for the same services. Landlord may cease to furnish electricity upon 30 days
prior written notice, provided within the 30 days Landlord connects with
another source of electric supply.
XII. ENTRY BY LANDLORD. Landlord and its agents or representatives shall
have the right to enter the Premises with reasonable prior notice (and in
emergencies at all times, without prior notice, by any means Landlord may deem
appropriate, and without liability therefor) to inspect the same, or to show
the Premises to prospective purchasers, mortgagees, tenants or insurers, or to
clean or make repairs, alterations or additions thereto, including any work
that Landlord deems necessary for the safety, protection or preservation of
the Building or any occupants thereof, or to facilitate repairs, alterations
or additions to the Building or any other tenants premises. If reasonably
necessary for the protection and safety of Tenant and its employees, Landlord
shall have the right to temporarily close the Premises to perform repairs,
alterations or additions in the Premises, provided that Landlord shall use
reasonable efforts to perform all such work on weekends and after Normal
Business Hours. Entry by Landlord hereunder shall not constitute a
constructive eviction or entitle Tenant to any abatement or reduction of Rent
by reason thereof. Notwithstanding the foregoing, Landlord and its agents and
representatives shall not have to provide Tenant with prior notice to perform
janitor and cleaning service in the Premises before or after Normal Business
Hours.
XIII. ASSIGNMENT AND SUBLETTING.
A. Tenant shall not assign, sublease, transfer or encumber this Lease or
any interest therein or grant any license, concession or other right of
occupancy of the Premises or any portion thereof or otherwise permit the use
of the Premises or any portion thereof by any party other than Tenant (any of
which events is hereinafter called a "Transfer") without the prior written
consent of Landlord, which consent shall not be unreasonably withheld with
respect to any proposed assignment or subletting. Landlord's consent shall
not be considered unreasonably withheld if: 1. the proposed transferee's
financial responsibility does not meet the same criteria Landlord uses to
select Building tenants, provided with respect to a subtenant, Landlord shall
apply a standard of whether the proposed subtenant is financially able to meet
its obligations, including its obligation to pay rent under the sublease, as
they become due; 2. the proposed transferee's business is not suitable for the
Building considering the business of the other tenants and the Building's
prestige or would result in a violation of an exclusive right granted to
another tenant in the Building; 3. the proposed use is different than the
Permitted Use; 4. the proposed transferee is a government agency or occupant
of the Project; or 5. Tenant is in default. Tenant acknowledges that the
foregoing is not intended to be an exclusive list of the reasons for which
Landlord may reasonably withhold its consent to a proposed Transfer. Any
attempted Transfer in violation of the terms of this Article shall, at
Landlord's option, be void. Consent by Landlord to one or more Transfers
shall not operate as a waiver of Landlord's rights as to any subsequent
Transfers. In addition, Tenant shall not, without Landlord's consent,
publicly offer or advertise the Lease for Transfer in any media. In the event
Tenant or anyone acting on behalf of Tenant or with Tenant's knowledge
violates the provisions of the foregoing sentence, Landlord, in addition to
its other remedies, shall be entitled to seek injunctive relief preventing
such action, and Tenant shall be responsible for all costs incurred by
Landlord in connection therewith.
B. If Tenant requests Landlord's consent to a Transfer, Tenant shall
notify Landlord in writing at least 45 days prior to the effective date of the
proposed Transfer of the name of the proposed transferee and the nature of the
business of the proposed transferee, the term, use, rental rate and all other
material terms and conditions of the proposed Transfer, including, without
limitation, evidence satisfactory to Landlord that the proposed transferee is
financially responsible. Notwithstanding the provisions of Section XIII.A.
above, Landlord may, during said 45-day period, 1. consent to or refuse to
consent to such Transfer in writing; or 2. negotiate directly with the
proposed transferee and (in the event Landlord is able to reach agreement with
such proposed transferee) upon execution of a lease with such transferee,
terminate this Lease (in part or in whole, as appropriate) upon thirty (30)
days' notice; or 3. cancel and terminate this Lease, in whole or in part as
8
appropriate, upon 30 days notice. In the event Landlord consents to any such
Transfer, the Transfer shall be in a form approved by Landlord, and Tenant
shall bear all costs and expenses incurred by Landlord in connection with the
review and approval of such documentation, which costs and expenses shall not
exceed Seven Hundred Fifty Dollars ($750.00).
C. Fifty percent (50%) of all cash or other proceeds (the "Transfer
Consideration") of any Transfer of Tenant's interest in this Lease and/or the
Premises, whether consented to by Landlord or not, shall be paid to Landlord
and Tenant hereby assigns all rights it might have or ever acquire in any such
proceeds to Landlord. In addition to the Rent hereunder, Tenant hereby
covenants and agrees to pay to Landlord fifty percent (50%) of all rent and
other consideration which it receives which is in excess of the Rent payable
hereunder within ten (10) days following receipt thereof by Tenant. In
addition to any other rights Landlord may have, Landlord shall have the right
to contact any transferee and require that all payments made pursuant to the
Transfer shall be made directly to Landlord.
D. If Tenant is a corporation and if at any time during the Lease Term
the person or persons who own the voting shares at the time of the execution
of this Lease cease for any reason, including but not limited to merger,
consolidation or other reorganization involving another corporation, to own a
majority of such shares, or if Tenant is a partnership and if at any time
during the Lease Term the general partner or partners who own the general
partnership interests in the partnership at the time of the execution of this
Lease, cease for any reason to own a majority of such interests (except as the
result of transfers by gift, bequest or inheritance to or for the benefit of
members of the immediate family of such original shareholder(s) or
partner(s)), such an event shall be deemed to be a Transfer. The preceding
sentence shall not apply whenever Tenant is a corporation the outstanding
stock of which is listed on a recognized security exchange, or if at least
eighty per cent (80%) of its voting stock is owned by another corporation, the
voting stock of which is so listed.
E. Any Transfer consented to by Landlord in accordance with this Article
XIII shall be only for the Permitted Use and for no other purpose, and in no
event shall any Transfer release or relieve Tenant or any Guarantors from any
obligations under this Lease.
XIV. LIENS. Tenant will not permit any mechanic's liens or other liens to be
placed upon the Premises or Tenant's leasehold interest therein, the Building,
or the real estate associated therewith. Landlord's title to the Building and
Project is and always shall be paramount to the interest of Tenant, and
nothing herein contained shall empower Tenant to do any act that can, shall or
may encumber Landlord's title. In the event any such lien does attach, Tenant
shall, within 5 days of notice of the filing of said lien, either discharge or
bond over such lien to the satisfaction of Landlord and Landlord's Mortgagee
(as hereinafter defined), and in such a manner as to stay the enforcement or
foreclosure of such lien. If Tenant shall fail to so discharge or bond over
such lien, then, in addition to any other right or remedy of Landlord,
Landlord may, but shall not be obligated to, discharge the same. Any amount
paid by Landlord for any of the aforesaid purposes, including reasonable
attorneys fees (if and to the extent permitted by law) shall be paid by Tenant
to Landlord on demand as additional Rent.
XV. INDEMNITY AND WAIVER OF CLAIMS.
A. Except for losses, liabilities, obligations, damages, penalties,
claims, costs, charges, and expenses resulting from the negligence of Landlord
and/or its agents, employees or contractors, and subject to the provisions of
Article XVII hereof, Tenant shall indemnify, defend and hold Landlord, its
principals, beneficiaries, partners, officers, directors, agents, employees
and any Mortgagee(s) (collectively the "Landlord Related Parties") harmless
against and from all liabilities, obligations, damages, penalties, claims,
costs, charges and expenses, including, without limitation, reasonable
architects' and attorneys' fees (if and to the extent permitted by law), which
may be imposed upon, incurred by, or asserted against Landlord or any of the
Landlord Related Parties and arising, directly or indirectly, out of or in
connection with the use, occupancy or maintenance of the Premises by, through
or under Tenant, and (without limiting the generality of the foregoing)
9
any of the following: 1. any work or thing done in, on or about the Premises
or any part thereof by Tenant or any of its transferees, agents, servants,
contractors, employees, customers, licensees or invitees; 2. any use, non-use,
possession, occupation, condition, operation or maintenance of the Premises or
any part thereof; 3. any act or omission of Tenant or any of its transferees,
agents, servants, contractors, employees, customers, licensees or invitees,
regardless of whether such act or omission occurred within the Premises; 4.
any injury or damage to any person or property occurring in, on or about the
Premises or any part thereof; or 5. any failure on the part of Tenant to
perform or comply with any of the covenants, agreements, terms or conditions
contained in this Lease with which Tenant must comply or perform. In case any
action or proceeding is brought against Landlord or any of the Landlord
Related Parties by reason of any of the foregoing, Tenant shall, at Tenant's
sole cost and expense, resist and defend such action or proceeding with
counsel approved by Landlord or, at Landlord's option, reimburse Landlord for
the cost of any counsel retained directly by Landlord to defend and resist
such action or proceeding.
B. Landlord and the Landlord Related Parties shall not be liable for, and
Tenant waives, all claims for loss or damage to Tenant's business or damage to
person or property sustained by Tenant or any person claiming by, through or
under Tenant (including Tenant's employees) resulting from any accident or
occurrence in, on or about the Premises, the Building or the Project,
including, without limitation, claims for loss, theft or damage resulting
from: 1. the Premises, Building, or Project, or any equipment or
appurtenances becoming out of repair; 2. wind or weather; 3. any defect in or
failure to operate, for whatever reason, any sprinkler, heating or air-
conditioning equipment, electric wiring, gas, water or steam pipes; 4. broken
glass; 5. the backing up of any sewer pipe or downspout; 6. the bursting,
leaking or running of any tank, water closet, drain or other pipe; 7. the
escape of steam or water; 8. water, snow or ice being upon or coming through
the roof, skylight, stairs, doorways, windows, walks or any other place upon
or near the Building; 9. the falling of any fixture, plaster, tile or other
material; 10. any act, omission or negligence of other tenants, licensees or
any other persons or occupants of the Building or of adjoining or contiguous
buildings, of owners of adjacent or contiguous property or the public, or by
construction of any private, public or quasi-public work; or 11. any other
cause of any nature except, as to items 1. - 9., where such loss or damage is
due to Landlord's negligence or willful failure to make repairs required to be
made pursuant to other provisions of this Lease, after the expiration of a
reasonable time after written notice to Landlord of the need for such repairs.
To the maximum extent permitted by law, Tenant agrees to use and occupy the
Premises, and to use such other portions of the Project as Tenant is herein
given the right to use, at Tenant's own risk.
C. Except for losses, liabilities, obligations, damages, penalties,
claims, costs, charges and expenses resulting from the negligence of Tenant
and/or its agents, employees or contractors, and subject to the provisions of
Article XVII hereof, Landlord shall indemnify, defend and hold Tenant, its
principals, agents and employees (collectively the "Tenant Related Parties")
harmless from and against all liabilities, obligations, damages (other than
consequential damages), penalties, claims, costs, charges and expenses,
including, without limitation, reasonable attorneys' fees, which may be
imposed upon, incurred by, or asserted against Tenant or any of the Tenant
Related Parties and arising, directly or indirectly, out of or in connection
with any of the following:(i) any work or thing done in, on or about the
Common Areas or any part thereof by Landlord or any of its agents, contractors
or employees; (ii) any use, non-use, possession, occupation, condition,
operation, maintenance or management of the Common Areas or any part thereof
by Landlord or any of its agents, contractors or employees (iii) any act or
omission of Landlord or any of its agents, contractors or employees; and (iv)
any injury or damage to any person or property occurring in, on or about the
Common Areas or any part thereof; provided, however, that in each case such
liability, obligation, damage, penalty, claim, cost, charge or expense results
from the negligence of Landlord and/or its agents, employees or contractors.
D. Subject to the provisions of Articles X, XXII and XXIII hereof, Tenant
and the Tenant Related Parties shall not be liable for, and Landlord waives,
all claims for loss or damage to Landlord's business or damage to person or
property sustained
10
by Landlord or any person claiming by, through or under Landlord (including
Landlord's employees) resulting from any accident or occurrence in, on or
about the Premises, the Building or the Property, including, without
limitation, claims for loss, theft or damage resulting from: (1) the Premises,
Building, or Property, or any equipment or appurtenances becoming out of
repair: (2) wind or weather; (3) any defect in or failure to operate, for
whatever reason, any sprinkler, heating or air-conditioning equipment,
electric wiring, gas, water or steam pipes; (4) broken glass; (5) the backing
up of any sewer pipe or downspout; (6) the bursting, leaking or running of any
tank, water closet, drain or other pipe; (7) the escape of steam or water; (8)
water, snow or ice being upon or coming through the roof, skylight, stairs,
doorways, windows, walks or any other place upon or near the Building; (9) the
falling of any fixture, plaster, tile or other material; (10) any act,
omission or negligence of other tenants, licensees or any other persons or
occupants of the Building or of adjoining or contiguous buildings, of owners
of adjacent or contiguous property or the public, or by construction of any
private, public or quasi-public work; or (11) any other cause of any nature
except, as to items (1) - (9), where such loss or damage is due to Tenant's
negligence or willful failure to make repairs required to be made pursuant to
other provisions of this Lease.
XVI. TENANT'S INSURANCE.
A. At all times commencing on and after the earlier of the Commencement
Date and the date Tenant or its agents, employees or contractors enters the
Premises for any purpose, Tenant shall carry and maintain, at its sole cost
and expense:
1. Commercial General Liability Insurance with a Broad Form General
Liability Endorsement applicable to the Premises and its appurtenances
providing, on an occurrence basis, a minimum combined single limit of Two
Million Dollars ($2,000,000).
2. All Risks of Physical Loss Insurance written at replacement cost
value and with a replacement cost endorsement covering all of Tenant's
Property in the Premises.
3. Workers Compensation Insurance as required by the state in which
the Premises is located and in amounts as may be required by applicable
statute, and Employers Liability Coverage of One Million Dollars ($1,000,000)
per occurrence.
4. Whenever good business practice, in Landlord's reasonable
judgment, indicates the need of additional insurance coverage or different
types of insurance in connection with the Premises or Tenant's use and
occupancy thereof, Tenant shall, upon request, obtain such insurance at
Tenant's expense and provide Landlord with evidence thereof.
B. Except for items for which Landlord is responsible under the Work
Letter Agreement, before any repairs, alterations, additions, improvements, or
construction are undertaken by or on behalf of Tenant, Tenant shall carry and
maintain, at its expense, or Tenant shall require any contractor performing
work on the Premises to carry and maintain, at no expense to Landlord, in
addition to worker's compensation insurance as required by the jurisdiction in
which the Building is located, All Risk Builder's Risk Insurance in the amount
of the replacement cost of any alterations, additions or improvements (or such
other amount reasonably required by Landlord) and Commercial General Liability
Insurance (including, without limitation, Contractor's Liability coverage,
Contractual Liability coverage, Completed Operations coverage, a Broad Form
Property Damage coverage and Contractor's Protective liability) written on an
occurrence basis with a minimum combined single limit of Two Million Dollars
($2,000,000); such limit may be accomplished by means of an umbrella policy.
C. Any company writing any insurance which Tenant is required to maintain
or cause to be maintained pursuant to the terms of this Lease (all such
insurance as well as any other insurance pertaining to the Premises or the
operation of Tenant's business therein being referred to as "Tenant's
Insurance"), as well as the form of such insurance, shall at all times be
subject to Landlord's reasonable
11
approval, and each such insurance company shall have an A.M. Best rating of
"A7" or better and shall be licensed and qualified to do business in the state
in which the Premises are located. All policies evidencing Tenant's Insurance
(except for Workers Compensation) shall specify Tenant and the "owner[s] of
the Building and its (or their) respective principals, beneficiaries,
partners, officers, directors, employees, agents and mortgagee[s]" (and any
other designees of Landlord as the interest of such designees shall appear) as
additional insureds. Provided that the coverage afforded Landlord and any
designees of Landlord shall not be reduced or otherwise adversely affected,
all of Tenant's Insurance may be carried under a blanket policy covering the
Premises and any other of Tenant's locations. All liability policies of
Tenant's Insurance shall contain endorsements that the insurer(s) will give to
Landlord and its designees at least thirty (30) days' advance written notice
of any change, cancellation, termination or lapse of said insurance. Tenant
shall be solely responsible for payment of premiums for all of Tenant's
Insurance. Tenant shall deliver to Landlord at least fifteen (15) days prior
to the time Tenant's Insurance is first required to be carried by Tenant, and
upon renewals at least fifteen (15) days prior to the expiration of any such
insurance coverage, a certificate of insurance of all policies procured by
Tenant in compliance with its obligations under this Lease. The limits of
Tenant's Insurance shall in no event limit Tenant's liability under this
Lease.
D. Tenant shall not do or fail to do anything in, upon or about the
Premises which will: 1. violate the terms of any of Landlord's insurance
policies; 2. prevent Landlord from obtaining policies of insurance acceptable
to Landlord or any Mortgagees; or 3. result in an increase in the rate of any
insurance on the Premises, the Building, any other property of Landlord or of
others within the Building. In the event of the occurrence of any of the
events set forth in this Section, Tenant shall pay Landlord upon demand, as
additional Rent, the cost of the amount of any increase in any such insurance
premium. If Tenant fails to obtain the insurance coverage required by this
Lease, Landlord may, at its option, obtain such insurance for Tenant, and
Tenant shall pay, as additional Rent, the cost of all premiums thereon and all
of Landlord's costs associated therewith.
XVII. SUBROGATION. Notwithstanding anything set forth in this Lease to the
contrary, Landlord and Tenant do hereby waive any and all right of recovery,
claim, action or cause of action against the other, their respective
principals, beneficiaries, partners, officers, directors, agents, and
employees, and, with respect to Landlord, its Mortgagee[s], for any loss or
damage that may occur to Landlord or Tenant or any party claiming by, through
or under Landlord or Tenant, as the case may be, with respect to their
respective property, the Building, the Property or the Premises or any
addition or improvements thereto, or any contents therein, by reason of fire,
the elements or any other cause, regardless of cause or origin, including the
negligence of Landlord or Tenant, or their respective principals,
beneficiaries, partners, officers, directors, agents and employees and, with
respect to Landlord, its Mortgagee[s], which loss or damage is (or would have
been, had the insurance required by this Lease been carried) covered by
insurance. Since this mutual waiver will preclude the assignment of any such
claim by subrogation (or otherwise) to an insurance company (or any other
person), Landlord and Tenant each agree to give each insurance company which
has issued, or in the future may issue, its policies of fire, extended
coverage or material damage insurance, written notice of the terms of this
mutual waiver, and to have such insurance policies properly endorsed, if
necessary, to prevent the invalidation of any of the coverage provided by such
insurance policies by reason of such mutual waiver. For the purpose of the
foregoing waiver, the amount of any deductible applicable to any loss or
damage shall be deemed covered by, and recoverable by the insured under the
insurance policy to which such deductible relates. In the event that Tenant
is permitted to and self-insures any risk which would have been covered by the
insurance required to be carried by Tenant pursuant to Article XVI of the
Lease, or if Tenant fails to carry any insurance required to be carried by
Tenant pursuant to Article XVI of this Lease, then all loss or damage to
Tenant, its leasehold interest, its business, its property, the Premises or
any additions or improvements thereto or contents thereof shall be deemed
covered by and recoverable by Tenant under valid and collectible policies of
insurance.
12
XVIII. LANDLORD'S INSURANCE. Landlord shall maintain property insurance on
the Building in such amounts as Landlord reasonably elects, provided that
during the Lease Term Landlord shall maintain standard so-called "all risk"
property insurance covering the Building in an amount equal to the replacement
cost thereof (including Leasehold Improvements approved by Landlord) at the
time in question. The cost of such insurance shall be included as a part of
the Basic Costs, and payments for losses thereunder shall be made solely to
Landlord or the Mortgagees of Landlord as their interests shall appear.
XIX. CASUALTY DAMAGE. If the Premises or any part thereof shall be damaged
by fire or other casualty, Tenant shall give prompt written notice thereof to
Landlord. In case the Building shall be so damaged that substantial
alteration or reconstruction of the Building shall, in Landlord's sole
opinion, be required (whether or not the Premises shall have been damaged by
such casualty) or in the event the Premises have been damaged and there is
less than two (2) years of the Lease Term remaining on the date of such
casualty or in the event any Mortgagee should require that the insurance
proceeds payable as a result of a casualty be applied to the payment of the
mortgage debt or in the event of any material uninsured loss to the Building,
Landlord may, at its option, terminate this Lease by notifying Tenant in
writing of such termination within ninety (90) days after the date of such
casualty. Such termination shall be effective as of the date of fire or
casualty, with respect to any portion of the Premises that was rendered
untenantable, and the date specified in Landlord's notice, with respect to any
portion of the Premises that remained tenantable. If Landlord does not elect
to terminate this Lease, Landlord shall commence and proceed with reasonable
diligence to restore the Building (provided that Landlord shall not be
required to restore any unleased premises in the Building) and the Leasehold
Improvements (but excluding any improvements, alterations or additions made by
Tenant in violation of this Lease) located within the Premises, if any, which
Landlord has insured to substantially the same condition they were in
immediately prior to the happening of the casualty. Notwithstanding the
foregoing, Landlord's obligation to restore the Building, and the Leasehold
Improvements, if any, shall not require Landlord to expend for such repair and
restoration work more than the insurance proceeds actually received by the
Landlord as a result of the casualty. When repairs to the Premises have been
completed by Landlord, Tenant shall complete the restoration or replacement of
all Tenant's Property necessary to permit Tenant's reoccupancy of the
Premises, and Tenant shall present Landlord with evidence satisfactory to
Landlord of Tenant's ability to pay such costs prior to Landlord's
commencement of repair and restoration of the Premises. Landlord shall not be
liable for any inconvenience or annoyance to Tenant or injury to the business
of Tenant resulting in any way from such damage or the repair thereof, except
that, subject to the provisions of the next sentence, Landlord shall allow
Tenant a fair diminution of Rent on a per diem basis during the time and to
the extent the Premises are untenantable. If the Premises or any other
portion of the Building is damaged by fire or other casualty resulting from
the fault or negligence of Tenant or any of Tenant's agents, employees, or
contractors, the Rent hereunder shall not be diminished during any period
during which the Premises, or any portion thereof, is untenantable, and Tenant
shall be liable to Landlord for the cost of the repair and restoration of the
Building caused thereby to the extent such cost and expense is not covered by
insurance proceeds. Landlord and Tenant hereby waive the provisions of any
law from time to time in effect during the Lease Term relating to the effect
upon leases of partial or total destruction of leased property. Landlord and
Tenant agree that their respective rights in the event of any damage to or
destruction of the Premises shall be those specifically set forth herein.
XX. DEMOLITION. INTENTIONALLY OMITTED.
XXI. CONDEMNATION. If 1. the whole or any substantial part of the Premises
or 2. any portion of the Building or Project which would leave the remainder
of the Building unsuitable for use as an office building comparable to its use
on the Commencement Date, shall be taken or condemned for any public or quasi-
public use under governmental law, ordinance or regulation, or by right of
eminent domain, or by private purchase in lieu thereof, then Landlord may, at
its option, terminate this Lease effective as of the date the physical taking
of said Premises or said portion of the Building or Project shall occur.
Notwithstanding the foregoing, if the whole or any substantial part of the
Premises shall be taken or
13
condemned for any public or quasi-public use under governmental law, ordinance
or regulation, or by right of eminent domain, or by private purchase in lieu
thereof, Tenant shall also have the right to terminate this Lease effective as
of the date the physical taking of the Premises occurs. Such right to
terminate shall be exercised by written notice to Landlord within thirty (30)
days after the date on which Tenant is first notified of the taking. In the
event this Lease is not terminated, the Rentable Area of the Project, the
Rentable Area of the Project and Tenant's Pro Rata Share shall be
appropriately adjusted. In addition, Rent for any portion of the Premises so
taken or condemned shall be abated during the unexpired term of this Lease
effective when the physical taking of said portion of the Premises shall
occur. All compensation awarded for any such taking or condemnation, or sale
proceeds in lieu thereof, shall be the property of Landlord, and Tenant shall
have no claim thereto, the same being hereby expressly waived by Tenant,
except for any portions of such award or proceeds which are specifically
allocated by the condemning or purchasing party for the taking of or damage to
trade fixtures of Tenant, which Tenant specifically reserves to itself.
XXII. EVENTS OF DEFAULT. The following events shall be deemed to be events
of default under this Lease:
A. Tenant shall fail to pay when due any Base Rental, Additional Base
Rental or other Rent under this Lease (hereinafter sometimes referred to as a
"Monetary Default").
B. Any failure by Tenant (other than a Monetary Default) to comply with
any term, provision or covenant of this Lease, which failure is not cured
within ten (10) days after delivery to Tenant of notice of the occurrence of
such failure, provided that if any such failure creates a hazardous condition,
such failure must be cured immediately.
C. Tenant or any Guarantor shall become insolvent, or shall make a
transfer in fraud of creditors, or shall commit an act of bankruptcy or shall
make an assignment for the benefit of creditors, or Tenant or any Guarantor
shall admit in writing its inability to pay its debts as they become due.
D. Tenant or any Guarantor shall file a petition under any section or
chapter of the United States Bankruptcy Code, as amended, pertaining to
bankruptcy, or under any similar law or statute of the United States or any
State thereof, or Tenant or any Guarantor shall be adjudged bankrupt or
insolvent in proceedings filed against Tenant or any Guarantor thereunder; or
a petition or answer proposing the adjudication of Tenant or any Guarantor as
a debtor or its reorganization under any present or future federal or state
bankruptcy or similar law shall be filed in any court and such petition or
answer shall not be discharged or denied within sixty (60) days after the
filing thereof.
E. A receiver or trustee shall be appointed for all or substantially all
of the assets of Tenant or any Guarantor or of the Premises or of any of
Tenant's property located thereon in any proceeding brought by Tenant or any
Guarantor, or any such receiver or trustee shall be appointed in any
proceeding brought against Tenant or any Guarantor and shall not be discharged
within sixty (60) days after such appointment or Tenant or such Guarantor
shall consent to or acquiesce in such appointment.
F. The leasehold estate hereunder shall be taken on execution or other
process of law or equity in any action against Tenant.
G. INTENTIONALLY OMITTED.
H. Tenant shall fail to take possession of and occupy the Premises within
thirty (30) days following the Commencement Date and thereafter continuously
conduct its operations in the Premises for the Permitted Use as set forth in
Paragraph IV hereof.
I. The liquidation, termination, dissolution, forfeiture of right to
do business or death of Tenant or any Guarantor.
14
J. Tenant shall be in default beyond any notice and cure period under any
other lease with Landlord.
XXIII. REMEDIES.
A. Upon the occurrence of any event or events of default under this
Lease, whether enumerated in Article XXII or not, Landlord shall have the
option to pursue any one or more of the following remedies without any notice
(except as expressly prescribed herein) or demand whatsoever (and without
limiting the generality of the foregoing, Tenant hereby specifically waives
notice and demand for payment of Rent or other obligations and waives any and
all other notices or demand requirements imposed by applicable law):
1. Terminate this Lease and Tenant's right to possession of the
Premises by giving written notice to Tenant, and recover from Tenant an award
of damages equal to the sum of the following:
(a) The Worth at the Time of Award of the unpaid Rent which had
been earned at the time of termination;
(b) The Worth at the Time of Award of the amount by which the
unpaid Rent which would have been earned after termination until the time of
award exceeds the amount of such Rent loss that Tenant affirmatively proves
could have been reasonably avoided;
(c) The Worth at the Time of Award of the amount by which the
unpaid Rent for the balance of the Term after the time of award exceeds the
amount of such Rent loss that Tenant affirmatively proves could be reasonably
avoided;
(d) Any other amount necessary to compensate Landlord for all the
detriment either 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 therefrom; and
(e) All such other amounts in addition to or in lieu of the
foregoing as may be permitted from time to time under applicable law.
The "Worth at the Time of Award" of the amounts referred to in
parts (a) and (b) above, shall be computed by allowing interest at the rate
specified in Article V.B., and the "Worth at the Time of Award" of the amount
referred to part (c), above, shall be computed by discounting such amount at
the discount rate of the Federal Reserve Bank of San Francisco at the time of
award plus one percent (1%);
2. Employ the remedy described in California Civil Code Section
1951.4 (Landlord may continue this Lease in effect after Tenant's breach and
abandonment and recover Rent as it becomes due, if Tenant has right to sublet
or assign, subject only to reasonable limitations); or
3. Notwithstanding Landlord's exercise of the remedy described in
California Civil Code Section 1951.4 in respect of an event or events of
default, at such time thereafter as Landlord may elect in writing, to
terminate this Lease and Tenant's right to possession of the Premises and
recover an award of damages as provided above in part 1.
B. The subsequent acceptance of Rent hereunder by Landlord shall not be
deemed to be a waiver of any preceding breach by Tenant of any term, covenant
or condition of this Lease, other than the failure of Tenant to pay the
particular Rent so accepted, regardless of Landlord's knowledge of such
preceding breach at the time of acceptance of such Rent. No waiver by
Landlord of any breach hereof shall be effective unless such waiver is in
writing and signed by Landlord.
C. TENANT HEREBY WAIVES ANY AND ALL RIGHTS CONFERRED BY SECTION 3275 OF
THE CIVIL CODE OF CALIFORNIA AND BY SECTIONS 1174 (C) AND 1179 OF THE CODE OF
CIVIL PROCEDURE OF CALIFORNIA AND ANY AND ALL OTHER LAWS AND RULES OF LAW
15
FROM TIME TO TIME IN EFFECT DURING THE TERM PROVIDING THAT TENANT SHALL HAVE
ANY RIGHT TO REDEEM, REINSTATE OR RESTORE THIS LEASE FOLLOWING ITS TERMINATION
BY REASON OF TENANT'S BREACH. TENANT ALSO HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, THE RIGHT TO TRIAL BY JURY IN ANY LITIGATION ARISING
OUT OF OR RELATING TO THIS LEASE
D. No right or remedy herein conferred upon or reserved to Landlord is
intended to be exclusive of any other right or remedy, and each and every
right and remedy shall be cumulative and in addition to any other right or
remedy given hereunder or now or hereafter existing by agreement, applicable
law or in equity. In addition to other remedies provided in this Lease,
Landlord shall be entitled, to the extent permitted by applicable law, to
injunctive relief, or to a decree compelling performance of any of the
covenants, agreements, conditions or provisions of this Lease, or to any other
remedy allowed to Landlord at law or in equity. Forbearance by Landlord to
enforce one or more of the remedies herein provided upon an event of default
shall not be deemed or construed to constitute a waiver of such default.
E. This Article XXIII shall be enforceable to the maximum extent such
enforcement is not prohibited by applicable law, and the unenforceability of
any portion thereof shall not thereby render unenforceable any other portion.
XXIV. LIMITATION OF LIABILITY. NOTWITHSTANDING ANYTHING TO THE CONTRARY
CONTAINED IN THIS LEASE, THE LIABILITY OF LANDLORD (AND OF ANY SUCCESSOR
LANDLORD HEREUNDER) TO TENANT SHALL BE LIMITED TO THE INTEREST OF LANDLORD IN
THE BUILDING, AND TENANT AGREES TO LOOK SOLELY TO LANDLORD'S INTEREST IN THE
BUILDING FOR THE RECOVERY OF ANY JUDGMENT OR AWARD AGAINST THE LANDLORD, IT
BEING INTENDED THAT LANDLORD SHALL NOT BE PERSONALLY LIABLE FOR ANY JUDGMENT
OR DEFICIENCY. TENANT HEREBY COVENANTS THAT, PRIOR TO THE FILING OF ANY SUIT
FOR AN ALLEGED DEFAULT BY LANDLORD HEREUNDER, IT SHALL GIVE LANDLORD AND ALL
MORTGAGEES WHOM TENANT HAS BEEN NOTIFIED HOLD MORTGAGES OR DEED OF TRUST LIENS
ON THE PROPERTY, BUILDING OR PREMISES NOTICE AND REASONABLE TIME TO CURE SUCH
ALLEGED DEFAULT BY LANDLORD. IN ADDITION, TENANT ACKNOWLEDGES THAT EQUITY
OFFICE PROPERTIES, LLC AND EQUITY OFFICE HOLDINGS, LLC ARE ACTING SOLELY IN
THEIR CAPACITY AS AGENT FOR LANDLORD AND SHALL NOT BE LIABLE FOR ANY
OBLIGATIONS, LIABILITIES, LOSSES OR DAMAGES ARISING OUT OF OR IN CONNECTION
WITH THIS LEASE, ALL OF WHICH ARE EXPRESSLY WAIVED BY TENANT.
XXV. NO WAIVER. Failure of Landlord to declare any default immediately upon
its occurrence, or delay in taking any action in connection with an event of
default shall not constitute a waiver of such default, nor shall it constitute
an estoppel against Landlord, but Landlord shall have the right to declare the
default at any time and take such action as is lawful or authorized under this
Lease. Failure by Landlord to enforce its rights with respect to any one
default shall not constitute a waiver of its rights with respect to any
subsequent default. Receipt by Landlord of Tenant's keys to the Premises
shall not constitute an acceptance or surrender of the Premises.
XXVI. EVENT OF BANKRUPTCY. In addition to, and in no way limiting the other
remedies set forth herein, Landlord and Tenant agree that if Tenant ever
becomes the subject of a voluntary or involuntary bankruptcy, reorganization,
composition, or other similar type proceeding under the federal bankruptcy
laws, as now enacted or hereinafter amended, then:
A. "Adequate protection" of Landlord's interest in the Premises pursuant
to the provisions of Section 361 and 363 (or their successor sections) of the
Bankruptcy Code, 11 U.S.C. Section 101 et seq., (such Bankruptcy Code as
amended from time to time being herein referred to as the "Bankruptcy Code"),
prior to assumption and/or assignment of the Lease by Tenant shall include,
but not be limited to all (or any part) of the following:
1. the continued payment by Tenant of the Base Rental and all other
Rent due and owing hereunder and the performance of all other covenants and
obligations hereunder by Tenant;
16
2. the hiring of security guards to protect the Premises if Tenant
abandons and/or ceases operations; such obligation of Tenant only to be
effective so long as Tenant remains in possession and control of the Premises
to the exclusion of Landlord;
3. the furnishing of an additional/new security deposit by Tenant in
the amount of three (3) times the then-current monthly Base Rental.
B. "Adequate assurance of future performance" by Tenant and/or any
assignee of Tenant pursuant to Bankruptcy Code Section 365 will include (but
not be limited to) payment of an additional/new Security Deposit in the amount
of three (3) times the then-current Base Rental payable hereunder.
C. Any person or entity to which this Lease is assigned pursuant to the
provisions of the Bankruptcy Code, shall be deemed without further act or deed
to have assumed all of the obligations of Tenant arising under this Lease on
and after the effective date of such assignment. Any such assignee shall,
upon demand by Landlord, execute and deliver to Landlord an instrument
confirming such assumption of liability.
D. Notwithstanding anything in this Lease to the contrary, all amounts
payable by Tenant to or on behalf of the Landlord under this Lease, whether or
not expressly denominated as "Rent", shall constitute "rent" for the purposes
of Section 502(b) (6) of the Bankruptcy Code.
E. If this Lease is assigned to any person or entity pursuant to the
provisions of the Bankruptcy Code, any and all monies or other considerations
payable or otherwise to be delivered to Landlord (including Base Rentals and
other Rent hereunder), shall be and remain the exclusive property of Landlord
and shall not constitute property of Tenant or of the bankruptcy estate of
Tenant. Any and all monies or other considerations constituting Landlord's
property under the preceding sentence not paid or delivered to Landlord shall
be held in trust by Tenant or Tenant's bankruptcy estate for the benefit of
Landlord and shall be promptly paid to or turned over to Landlord.
F. If Tenant assumes this Lease and proposes to assign the same pursuant
to the provisions of the Bankruptcy Code to any person or entity who shall
have made a bona fide offer to accept an assignment of this Lease on terms
acceptable to the Tenant, then notice of such proposed offer/assignment,
setting forth 1. the name and address of such person or entity, 2. all of the
terms and conditions of such offer, and 3. the adequate assurance to be
provided Landlord to assure such person's or entity's future performance under
the Lease, shall be given to Landlord by Tenant no later than twenty (20) days
after receipt by Tenant, but in any event no later than ten (10) days prior to
the date that Tenant shall make application to a court of competent
jurisdiction for authority and approval to enter into such assumption and
assignment, and Landlord shall thereupon have the prior right and option, to
be exercised by notice to Tenant given at any time prior to the effective date
of such proposed assignment, to accept an assignment of this Lease upon the
same terms and conditions and for the same consideration, if any, as the bona
fide offer made by such persons or entity, less any brokerage commission which
may be payable out of the consideration to be paid by such person for the
assignment of this Lease.
G. To the extent permitted by law, Landlord and Tenant agree that this
Lease is a contract under which applicable law excuses Landlord from accepting
performance from (or rendering performance to) any person or entity other than
Tenant within the meaning of Sections 365(c) and 365(e) (2) of the Bankruptcy
Code.
XXVII. QUIET ENJOYMENT. Tenant shall, and may peacefully have, hold, and
enjoy the Premises, subject to the other terms of this Lease (including,
without limitation, Article XXX hereof), provided that Tenant pays the Rent
herein recited to be paid by Tenant and performs all of Tenant's covenants and
agreements herein contained. This covenant and any and all other covenants of
Landlord shall be binding upon Landlord and its successors only during its or
their respective periods of ownership of the Landlord's interest hereunder.
17
XXVIII. RELOCATION. Landlord, at its expense, shall be entitled to cause
Tenant to relocate no more than one (1) time during the Lease Term from the
Premises to comparable space containing approximately the same Rentable Area
as the Premises (the "Relocation Space") within the Building or adjacent
buildings within the Project at any time upon sixty (60) days prior written
notice to Tenant, provided that the Relocation Space shall be located on or
above the fifteenth (15th) floor of the One Market complex. Landlord agrees
to reimburse Tenant for all reasonable costs actually incurred in connection
with the Relocation, including the cost of reprinting existing stationery and
business cards, moving telephones, graphics and similar items of expense.
Such a relocation shall not affect this Lease except that from and after the
date of such relocation, "Premises" shall refer to the Relocation Space into
which Tenant has been moved, rather than the original Premises as herein
defined, and the Base Rental shall be adjusted so that immediately following
such relocation the Base Rental for the Relocation Space per annum on a per
square foot of Rentable Area basis shall be the same as the Base Rental per
annum immediately prior to such relocation for the original Premises on a per
square foot of Rentable Area basis.
XXIX. HOLDING OVER. In the event of holding over by Tenant after expiration
or other termination of this Lease or in the event Tenant continues to occupy
the Premises after the termination of Tenant's right of possession pursuant to
Articles XXII and XXIII hereof, occupancy of the Premises subsequent to such
termination or expiration shall be that of a tenancy at sufferance and in no
event for month-to-month or year-to-year, but Tenant shall, throughout the
entire holdover period, pay rent (on a per month basis without reduction for
any partial months during any such holdover) equal to one hundred fifty
percent (150%) of the sum of the Base Rental and Additional Base Rental due
for the period immediately preceding such holding over, provided if the
holding over continues for more than thirty (30) days, effective as of the
thirty-first day, holdover rent shall increase to 200% of the sum of the Base
Rental and Additional Base Rental due for the period immediately preceding
such holding over, and further provided that in no event shall Base Rental and
Additional Base Rental during the holdover period be less than the fair market
rental for the Premises. No holding over by Tenant or payments of money by
Tenant to Landlord after the expiration of the term of this Lease shall be
construed to extend the Lease Term or prevent Landlord from recovery of
immediate possession of the Premises by summary proceedings or otherwise.
Tenant shall be liable to Landlord for all damage, including any consequential
damage, which Landlord may suffer by reason of any holding over by Tenant, and
Tenant shall indemnify Landlord against any and all claims made by any other
tenant or prospective tenant against Landlord for delay by Landlord in
delivering possession of the Premises to such other tenant or prospective
tenant.
XXX. SUBORDINATION TO MORTGAGES. Tenant accepts this Lease subject and
subordinate to any mortgage, deed of trust, assignment of leases and rents,
ground lease or other lien presently existing or hereafter arising upon the
Premises, or upon the Building and/or the Project and to any renewals,
modifications, refinancings and extensions thereof (any such mortgage, deed of
trust, assignment of leases and rents, lease or other lien being hereinafter
referred to as a "Mortgage", and the person or entity having the benefit of
same being referred to hereinafter as a "Mortgagee"), but Tenant agrees that
any such Mortgagee shall have the right at any time to subordinate such
Mortgage to this Lease on such terms and subject to such conditions as such
Mortgagee may deem appropriate in its discretion. This clause shall be self-
operative and no further instrument of subordination shall be required.
However, Landlord is hereby irrevocably vested with full power and authority
to subordinate this Lease to any Mortgage, and Tenant agrees upon demand to
execute such further instruments subordinating this Lease, acknowledging the
subordination of this Lease or attorning to the holder of any such Mortgage as
Landlord may request. The terms of this Lease are subject to approval by the
Landlord's existing lender(s) and any lender(s) who, at the time of the
execution of this Lease, have committed or are considering committing to
Landlord to make a loan secured by all or any portion of the Project, and such
approval is a condition precedent to Landlord's obligations hereunder. In the
event that Tenant should fail to execute any subordination or other agreement
required by this Article promptly as requested, Tenant hereby irrevocably
constitutes Landlord as its attorney-in-fact to execute such instrument in
Tenant's name, place and stead, it being agreed that such power is one coupled
18
with an interest in Landlord and is accordingly irrevocable. If any person
shall succeed to all or part of Landlord's interests in the Premises whether
by purchase, foreclosure, deed in lieu of foreclosure, power of sale,
termination of lease or otherwise, and if and as so requested or required by
such successor-in-interest, Tenant shall, without charge, attorn to such
successor-in-interest and if requested Tenant shall enter into a new lease
with such successor-in-interest for the balance of the Term of the Lease then
remaining on the same terms and conditions. Said successor-in-interest shall
not be bound by (i) any payment of Base Rental or Additional Base Rental for
more than one (1) month in advance, except prepayments in the nature of
security for the performance by Tenant of its obligations under the Lease or
prepayments for estimated Basic Costs, or (ii) any material amendment or
modification of the Lease made without the written consent of Mortgagee or
such successor-in-interest except to the extent such amendment is entered into
to document the exercise by Landlord or Tenant of any option or other rights
specifically provided in the Lease. Tenant agrees that it will from time to
time upon request by Landlord and, within five days of the date of such
request, execute and deliver to such persons as Landlord shall request an
estoppel certificate or other similar statement in recordable form certifying
that this Lease is unmodified and in full force and effect (or if there have
been modifications, that the same is in full force and effect as so modified),
stating the dates to which Rent and other charges payable under this Lease
have been paid, stating that Landlord is not in default hereunder (or if
Tenant alleges a default stating the nature of such alleged default) and
further stating such other matters as Landlord shall reasonably require.
XXXI. ATTORNEY'S FEES. In the event that Landlord should retain counsel
and/or institute any suit against Tenant for violation of or to enforce any of
the covenants or conditions of this Lease, or should Tenant institute any suit
against Landlord for violation of any of the covenants or conditions of this
Lease, or should either party intervene in any suit in which the other is a
party to enforce or protect its interest or rights hereunder, the prevailing
party in any such suit shall be entitled to all of its costs, expenses and
reasonable fees of its attorney(s) (if and to the extent permitted by law) in
connection therewith.
XXXII. NOTICE. Whenever any demand, request, approval, consent or notice
("Notice") shall or may be given to either of the parties by the other, each
such Notice shall be in writing and shall be sent by registered or certified
mail with return receipt requested, or sent by overnight courier service (such
as Federal Express) at the respective addresses of the parties for notices as
set forth in Section I.A.6. of this Lease, provided that if Tenant has vacated
the Premises or is in default of this Lease Landlord may serve Notice by any
manner permitted by Law. Any Notice under this Lease delivered by registered
or certified mail shall be deemed to have been given and effective on the
earlier of (a) the third day following the day on which the same shall have
been mailed with sufficient postage prepaid or (b) the delivery date indicated
on the return receipt. Notice sent by overnight courier service shall be
deemed given and effective upon the day after such notice is delivered to or
picked up by the overnight courier service. Either party may, at any time,
change its Notice Address by giving the other party Notice stating the change
and setting forth the new address.
XXXIII. LANDLORD'S LIEN. INTENTIONALLY OMITTED. The deletion of this
Article XXXIII shall not be construed as a waiver of Landlord's lien rights as
provided by law.
XXXIV. EXCEPTED RIGHTS. This Lease does not grant any rights to light or air
over or about the Building. Landlord specifically excepts and reserves to
itself the use of any roofs, the exterior portions of the Premises, all rights
to and the land and improvements below the improved floor level of the
Premises, the improvements and air rights above the Premises and the
improvements and air rights located outside the demising walls of the
Premises, and such areas within the Premises as are required for installation
of utility lines and other installations required to serve any occupants of
the Building and the right to maintain and repair the same, and no rights with
respect thereto are conferred upon Tenant unless otherwise specifically
provided herein. Landlord further reserves to itself the right from time to
time: A. to change the Building's name or street address; B. to install, fix
and maintain signs on the exterior and interior of the Building; C. to
designate and approve window coverings; D. to make any decorations,
alterations,
19
additions, improvements to the Building, or any part thereof (including the
Premises) which Landlord shall desire, or deem necessary for the safety,
protection, preservation or improvement of the Building, or as Landlord may be
required to do by law; E. to have access to the Premises to perform its
duties and obligations and to exercise its rights under this Lease; F. to
retain at all times and to use pass-keys to all locks within and into the
Premises; G. to approve the weight, size, or location of heavy equipment,
articles in and about the Premises; H. to close or restrict access to the
Building at all times other than Normal Business Hours subject to Tenant's
right to admittance at all times under such regulations as Landlord may
prescribe from time to time, or to close (temporarily or permanently) any of
the entrances to the Building; I. to change the arrangement and/or location
of entrances of passageways, doors and doorways, corridors, elevators, stairs,
toilets and public parts of the Building; and J. to grant to anyone the
exclusive right to conduct any business or undertaking in the Building.
Landlord, in accordance with Article XII hereof, shall have the right to enter
the Premises in connection with the exercise of any of the rights set forth
herein and such entry into the Premises and the performance of any work
therein shall not constitute a constructive eviction or entitle Tenant to any
abatement or reduction of Rent by reason thereof.
XXXV. SURRENDER OF PREMISES. At the expiration or earlier termination of
this Lease or Tenant's right of possession hereunder, Tenant shall quit and
surrender the Premises to Landlord, broom clean, and in good order, condition
and repair, ordinary wear and tear excepted. If Tenant fails to remove any of
Tenant's Property within one (1) day after the termination of this Lease or
Tenant's right to possession hereunder, such Tenant's Property, or any portion
thereof designated by Landlord, shall at Landlord's option, and without notice
to Tenant, (a) be conclusively presumed to have been abandoned by Tenant and
title to such items shall pass to Landlord, and/or (b) be removed and/or
stored by Landlord at the risk, cost and expense of Tenant and Landlord shall
in no event be responsible for the value, preservation or safekeeping thereof.
Tenant shall pay Landlord, upon demand, any and all expenses caused by such
removal and all storage charges against such property so long as the same
shall be in the possession of Landlord or under the control of Landlord.
XXXVI. MISCELLANEOUS.
A. If any term or provision of this Lease, or the application thereof to
any person or circumstance shall, to any extent, be invalid or unenforceable,
the remainder of this Lease, or the application of such term or provision to
persons or circumstances other than those as to which it is held invalid or
unenforceable, shall not be affected thereby, and each term and provision of
this Lease shall be valid and enforced to the fullest extent permitted by law.
B. Tenant agrees not to record this Lease or any memorandum hereof
without Landlord's prior written consent.
C. This Lease and the rights and obligations of the parties hereto shall
be interpreted, construed, and enforced in accordance with the laws of the
state in which the Building is located.
D. Events of "Force Majeure" shall include strikes, riots, acts of God,
shortages of labor or materials, war, governmental law, regulations or
restrictions and any other cause whatsoever that is beyond the control of
Landlord. Whenever a period of time is herein prescribed for the taking of
any action by Landlord, Landlord shall not be liable or responsible for, and
there shall be excluded from the computation of such period of time, any
delays due to events of Force Majeure.
E. Landlord shall have the right to transfer and assign, in whole or in
part, all of its rights and obligations hereunder and in the Building and
Project referred to herein, and in such event and upon such transfer Landlord
shall be released from any further obligations hereunder, and Tenant agrees to
look solely to such successor in interest of Landlord for the performance of
such obligations provided that Landlord and its successors, as the case may
be, shall remain liable after their respective periods of ownership with
respect to any sums due in connection with a breach or default that arose
during such period of ownership.
20
F. Tenant hereby represents to Landlord that it has dealt directly with
and only with the Broker as a broker in connection with this Lease. Tenant
agrees to indemnify and hold Landlord and the Landlord Related Parties
harmless from all claims of any brokers claiming to have represented Tenant in
connection with this Lease.
G. If there is more than one Tenant, or if the Tenant is comprised of
more than one person or entity, the obligations hereunder imposed upon Tenant
shall be joint and several obligations of all such parties. All notices,
payments, and agreements given or made by, with or to any one of such persons
or entities shall be deemed to have been given or made by, with or to all of
them.
H. In the event Tenant is a corporation (including any form of
professional association), partnership (general or limited), or other form of
organization other than an individual, then each individual executing or
attesting this Lease on behalf of Tenant hereby covenants, warrants and
represents: 1. that such individual is duly authorized to execute or attest
and deliver this Lease on behalf of Tenant in accordance with the
organizational documents of Tenant; 2. that this Lease is binding upon Tenant;
3. that Tenant is duly organized and legally existing in the state of its
organization, and is qualified to do business in the state in which the
Premises is located; 4. that upon request, Tenant will provide Landlord with
true and correct copies of all organizational documents of Tenant, and any
amendments thereto; and 5. that the execution and delivery of this Lease by
Tenant will not result in any breach of, or constitute a default under any
mortgage, deed of trust, lease, loan, credit agreement, partnership agreement
or other contract or instrument to which Tenant is a party or by which Tenant
may be bound. If Tenant is a corporation, Tenant will, prior to the
Commencement Date, deliver to Landlord a copy of a resolution of Tenant's
board of directors authorizing or ratifying the execution and delivery of this
Lease, which resolution will be duly certified to Landlord's satisfaction by
the secretary or assistant secretary of Tenant.
I. Tenant acknowledges that the financial capability of Tenant to perform
its obligations hereunder is material to Landlord and that Landlord would not
enter into this Lease but for its belief, based on its review of Tenant's
financial statements, that Tenant is capable of performing such financial
obligations. Tenant hereby represents, warrants and certifies to Landlord
that its financial statements previously furnished to Landlord were at the
time given true and correct in all material respects and that there have been
no material subsequent changes thereto as of the date of this Lease. At any
time during the Lease Term, Tenant shall provide Landlord, upon ten (10) days'
prior written notice from Landlord, with a current financial statement and
financial statements of the two (2) years prior to the current financial
statement year. Such statement shall be prepared in accordance with generally
accepted accounting principles and, if such is the normal practice of Tenant,
shall be audited by an independent certified public accountant.
J. Except as expressly otherwise herein provided, with respect to all
required acts of Tenant, time is of the essence of this Lease. This Lease
shall create the relationship of Landlord and Tenant between the parties
hereto, and no estate shall pass out of Landlord. Tenant has only a usufruct,
not subject to purchase or sale, which may not be assigned by Tenant except as
expressly provided in this Lease.
K. This Lease and the covenants and conditions herein contained shall
inure to the benefit of and be binding upon Landlord and Tenant and their
respective permitted successors and assigns.
L. Notwithstanding anything to the contrary contained in this Lease, the
expiration of the Lease Term, whether by lapse of time or otherwise, shall not
relieve Tenant from Tenant's obligations accruing prior to the expiration of
the Lease Term.
M. The headings and titles to the paragraphs of this Lease are for
convenience only and shall have no effect upon the construction or
interpretation of any part hereof.
21
N. LANDLORD HAS DELIVERED A COPY OF THIS LEASE TO TENANT FOR TENANT'S
REVIEW ONLY, AND THE DELIVERY HEREOF DOES NOT CONSTITUTE AN OFFER TO TENANT OR
OPTION. THIS LEASE SHALL NOT BE EFFECTIVE UNTIL AN ORIGINAL OF THIS LEASE
EXECUTED BY BOTH LANDLORD AND TENANT AND AN ORIGINAL GUARANTY, IF ANY,
EXECUTED BY EACH GUARANTOR IS DELIVERED TO AND ACCEPTED BY LANDLORD, AND THIS
LEASE HAS BEEN APPROVED BY LANDLORD'S MORTGAGEES, IF REQUIRED.
XXXVII. ENTIRE AGREEMENT. This Lease Agreement, including the following
Exhibits:
Exhibit A - Outline and Location of Premises
Exhibit A-2 - Legal Description of Project
Exhibit B-1 - Schedule of Base Rental
Exhibit B-2 - Payment of Basic Costs
Exhibit C - Work Letter Agreement
Exhibit D - Rules and Regulations
Exhibit E - Additional Terms
22
constitutes the entire agreement between the parties hereto with respect to
the subject matter of this Lease. TENANT EXPRESSLY ACKNOWLEDGES AND AGREES
THAT LANDLORD HAS NOT MADE AND IS NOT MAKING, AND TENANT, IN EXECUTING AND
DELIVERING THIS LEASE, IS NOT RELYING UPON, ANY WARRANTIES, REPRESENTATIONS,
PROMISES OR STATEMENTS, EXCEPT TO THE EXTENT THAT THE SAME ARE EXPRESSLY SET
FORTH IN THIS LEASE. ALL UNDERSTANDINGS AND AGREEMENTS HERETOFORE MADE
BETWEEN THE PARTIES ARE MERGED IN THIS LEASE WHICH ALONE FULLY AND COMPLETELY
EXPRESSES THE AGREEMENT OF THE PARTIES, NEITHER PARTY RELYING UPON ANY
STATEMENT OR REPRESENTATION NOT EMBODIED IN THIS LEASE. THIS LEASE MAY BE
MODIFIED ONLY BY A WRITTEN AGREEMENT SIGNED BY LANDLORD AND TENANT. LANDLORD
AND TENANT EXPRESSLY AGREE THAT THERE ARE AND SHALL BE NO IMPLIED WARRANTIES
OF MERCHANTABILITY, HABITABILITY, SUITABILITY, FITNESS FOR A PARTICULAR
PURPOSE OR OF ANY OTHER KIND ARISING OUT OF THIS LEASE, ALL OF WHICH ARE
HEREBY WAIVED BY TENANT, AND THAT THERE ARE NO WARRANTIES WHICH EXTEND BEYOND
THOSE EXPRESSLY SET FORTH IN THIS LEASE.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease in
multiple original counterparts as of the day and year first above written.
WITNESS/ATTEST: LANDLORD: ZML-ONE MARKET LIMITED
PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP
---------------------------------
Name (print): BY: Equity Office Holdings, LLC, a
------------------- Delaware limited liability
company as agent
---------------------------------
Name (print): By:
------------------- -------------------------------------
Name: XXXXXXX X. XXXX
-----------------------------------
Title: Vice President, Asset Management
----------------------------------
TENANT: TENERA, INC., A DELAWARE
CORPORATION
WITNESS/ATTEST:
XXXXX DE VOE
--------------------------------- By: XXXXXXX X. XXXXXXXX
Name (print): Xxxxx De Voe -------------------------------------
------------------- Name: Xxxxxxx X. Xxxxxxxx
-----------------------------------
XXXXXX XXXXXX Title: CFO
--------------------------------- ----------------------------------
Name (print): Xxxxxx XxXxxx
-------------------
23
EXHIBIT A
OUTLINE OF PREMISES
This Exhibit is attached to and made a part of the Lease dated __________,
1995, by and between ZML-ONE MARKET LIMITED PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP ("Landlord") by Equity Office Holdings, LLC, a Delaware limited
liability company, its agent and TENERA, INC., A DELAWARE CORPORATION
("Tenant") for space in the Building located at One Market, San Francisco,
California, commonly known as Spear Tower.
Suite No. 1850
Rentable Area of the Premises 9,484 sq. ft.
Commencement Date: September 1, 1995
Termination Date: October 31, 1997
[Diagram of leased space]
WITNESS/ATTEST: LANDLORD: ZML-ONE MARKET LIMITED
PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP
---------------------------------
Name (print): BY: Equity Office Holdings, LLC, a
------------------- Delaware limited liability
company as agent
---------------------------------
Name (print): By:
------------------- -------------------------------------
Name: XXXXXXX X. XXXX
-----------------------------------
Title: Vice President, Asset Management
----------------------------------
TENANT: TENERA, INC., A DELAWARE
CORPORATION
WITNESS/ATTEST:
XXXXX DE VOE
--------------------------------- By: XXXXXXX X. XXXXXXXX
Name (print): Xxxxx De Voe -------------------------------------
------------------- Name: Xxxxxxx X. Xxxxxxxx
-----------------------------------
XXXXXX XXXXXX Title: CFO
--------------------------------- ----------------------------------
Name (print): Xxxxxx XxXxxx
-------------------
EXHIBIT A-2
LEGAL DESCRIPTION OF PROJECT
PARCEL A (Office Project)
(1) The Fee Interest in the premises described below and (2) A LEASEHOLD
ESTATE in the premises described below as created by that certain Lease dated
April 16, 1973, made by and between SOUTHERN PACIFIC LAND COMPANY, a
California corporation, as Lessor and ONE MARKET PLAZA, a Joint Venture
composed of THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED SATES, a New
York corporation, and SOUTHERN PACIFIC LAND COMPANY, a California corporation,
as Lessee, a memorandum of said Lease recorded April 24, 1973, Book B755, Page
597, Series No. V71530, Official Records. THE LAND REFERRED TO HEREIN IS
SITUATED IN THE STATE OF CALIFORNIA, COUNTY OF SAN FRANCISCO, CITY OF SAN
FRANCISCO, AND IS DESCRIBED AS FOLLOWS:
BEGINNING AT THE POINT OF INTERSECTION OF THE NORTHWESTERLY LINE OF MISSION
STREET WITH THE SOUTHWESTERLY LINE OF XXXXXXX STREET; THENCE NORTH 44 DEGREES
51' 00" XXXX XXXXX XXXX XXXXXXXXXXXXX LINE, 334.33 FEET TO A POINT IN A LINE
PARALLEL WITH AND DISTANT 334.33 FEET NORTHWESTERLY, MEASURED AT RIGHT ANGLES,
FROM SAID NORTHWESTERLY LINE OF MISSION STREET; THENCE SOUTH 45 DEGREES 08'
09" WEST ALONG SAID PARALLEL LINE 32 FEET AND 4-1/2 INCHES; THENCE NORTH 44
DEGREES 51' 51" WEST 6 FEET AND 1-1/2 INCHES; THENCE SOUTH 45 DEGREES 08' 09"
WEST 16 FEET AND 4 INCHES; THENCE NORTH 44 DEGREES 51' 51" WEST 112 FEET AND
5-1/8 INCHES; THENCE SOUTH 45 DEGREES 08' 09" WEST 177 FEET AND 7-1/2 INCHES;
THENCE SOUTH 44 DEGREES 51' 51" EAST 112 FEET AND 5-1/8 INCHES; THENCE SOUTH
45 DEGREES 08' 09" WEST 16 FEET AND 3-1/2 INCHES; THENCE SOUTH 44 DEGREES 51'
51" EAST 6 FEET AND 1-1/2 INCHES TO A POINT IN SAID PARALLEL LINE; THENCE
SOUTH 45 DEGREES 08' 09" WEST ALONG SAID PARALLEL LINE 32 FEET AND 4-1/2
INCHES TO A POINT IN THE NORTHEASTERLY LINE OF SPEAR STREET; THENCE SOUTH 44
DEGREES 51' 51" EAST ALONG SAID NORTHEASTERLY LINE, 334.33 FEET TO A POINT IN
SAID NORTHWESTERLY LINE OF MISSION STREET; THENCE NORTH 45 DEGREES 08' 09"
EAST ALONG SAID NORTHWESTERLY LINE 275 FEET TO THE POINT OF BEGINNING.
PARCEL B (Lobby Lease)
A LEASEHOLD ESTATE in the premises described below as created by that certain
Lease dated April 16, 1973, made by and between SOUTHERN PACIFIC
TRANSPORTATION COMPANY, a Delaware corporation, as Lessor and ONE MARKET
PLAZA, a Joint Venture composed of THE EQUITABLE LIFE ASSURANCE SOCIETY OF THE
UNITED STATES, a New York corporation, and SOUTHERN PACIFIC LAND COMPANY, a
California corporation, as Lessee, a memorandum of said Lease recorded April
24, 2973, Book B755, Page 592, Series No. V71529, Official Records. THE LAND
REFERRED TO HEREIN IS SITUATED IN THE STATE OF CALIFORNIA, COUNTY OF SAN
FRANCISCO, CITY OF SAN FRANCISCO, AND IS DESCRIBED AS FOLLOWS:
BEGINNING AT A POINT ON THE SOUTHWESTERLY LINE OF XXXXXXX STREET THAT IS
DISTANT NORTH 44 DEGREES 51' 51" WEST 334.33 FEET FROM THE NORTHWESTERLY LINE
OF MISSION STREET; THENCE SOUTH 45 DEGREES 08' 09" WEST BEING PARALLEL WITH
AND DISTANT 334.33 FEET NORTHWESTERLY, MEASURED AT RIGHT ANGLES, FROM SAID
NORTHWESTERLY LINE OF MISSION STREET 32 FEET AND 4-1/2 INCHES; THENCE NORTH 44
DEGREES 51' 51" WEST 6 FEET AND 1-1/2 INCHES; THENCE SOUTH 45 DEGREES 08' 09"
WEST 16 FEET AND 4 INCHES; THENCE NORTH 44 DEGREES 51' 51" WEST 112 FEET AND
5-1/8 INCHES; THENCE SOUTH 45 DEGREES 08' 09" WEST 177 FEET AND 7-1/2 INCHES;
THENCE SOUTH 44 DEGREES 51' 51" EAST 112 FEET AND 5-1/8 INCHES; THENCE SOUTH
45 DEGREES 08' 09" WEST 16 FEET AND 3-1/2 INCHES; THENCE SOUTH 44 DEGREES 51'
51" EAST 6 FEET AND 1-1/2 INCHES TO A POINT IN SAID LINE THAT IS PARALLEL WITH
AND DISTANT 334.33 FEET NORTHWESTERLY, MEASURED AT RIGHT ANGLES FROM SAID
NORTHWESTERLY LINE OF MISSION STREET; THENCE SOUTH 45 DEGREES 08' 09" WEST
ALONG SAID PARALLEL LINE 32 FEET AND 4-1/2 INCHES TO A POINT ON THE
NORTHEASTERLY LINE OF SPEAR STREET; THENCE NORTH 44 DEGREES 51' 51" WEST ALONG
SAID NORTHEASTERLY LINE 216 FEET TO A POINT ON THE SOUTHEASTERLY LINE OF
MARKET STREET; THENCE NORTH 45 DEGREES 08' 09" EAST ALONG SAID SOUTHEASTERLY
LINE, 275 FEET TO A POINT IN SAID SOUTHWESTERLY LINE OF XXXXXXX STREET; THENCE
SOUTH 44 DEGREES 51' 51" EAST ALONG LAST SAID LINE 216 FEET TO THE POINT OF
BEGINNING.
EXHIBIT B-1
SCHEDULE OF BASE RENTAL
This Exhibit is attached to and made a part of the Lease dated __________,
1995, by and between ZML-ONE MARKET LIMITED PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP ("Landlord") by Equity Office Holdings, LLC, a Delaware limited
liability company, its agent and TENERA, INC., A DELAWARE CORPORATION
("Tenant") for space in the Building located at One Market, San Francisco,
California, commonly known as Spear Tower.
A. Tenant shall pay Landlord the sum of Five Hundred Thirteen Thousand
Seven Hundred Sixteen and 58/100 Dollars ($513,716.58) as Base Rental for the
Lease Term in monthly installments as follows:
1. Twenty-six (26) equal monthly installments of $19,758.33 each
payable on or before the first day of each month during the period beginning
September 1, 1995 and ending October 31, 1997.
B. All such Base Rental shall be payable by Tenant in accordance with the
terms of Article V of the Lease.
IN WITNESS WHEREOF, Landlord and Tenant have entered into this Lease as of
the date first written above.
WITNESS/ATTEST: LANDLORD: ZML-ONE MARKET LIMITED
PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP
---------------------------------
Name (print): BY: Equity Office Holdings, LLC, a
------------------- Delaware limited liability
company as agent
---------------------------------
Name (print): By:
------------------- -------------------------------------
Name: XXXXXXX X. XXXX
-----------------------------------
Title: Vice President, Asset Management
----------------------------------
TENANT: TENERA, INC., A DELAWARE
CORPORATION
WITNESS/ATTEST:
XXXXX DE VOE
--------------------------------- By: XXXXXXX X. XXXXXXXX
Name (print): Xxxxx De Voe -------------------------------------
------------------- Name: Xxxxxxx X. Xxxxxxxx
-----------------------------------
XXXXXX XXXXXX Title: CFO
--------------------------------- ----------------------------------
Name (print): Xxxxxx XxXxxx
-------------------
EXHIBIT B-2
PAYMENT OF BASIC COSTS
This Exhibit is attached to and made a part of the Lease dated __________,
1995, by and between ZML-ONE MARKET LIMITED PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP ("Landlord") by Equity Office Holdings, LLC, a Delaware limited
liability company, its agent and TENERA, INC., A DELAWARE CORPORATION
("Tenant") for space in the Building located at One Market, San Francisco,
California, commonly known as Spear Tower.
BASIC COST ADJUSTMENT. During each calendar year, or portion thereof,
falling within the Lease Term, Tenant shall pay to Landlord as Additional Base
Rental hereunder the sum of (1) Tenant's Pro Rata Share of the amount, if any,
by which Taxes (hereinafter defined) for the applicable calendar year exceed
Taxes for the Base Year (hereinafter defined) plus (2) Tenant's Pro Rata Share
of the amount, if any, by which Expenses (hereinafter defined) for the
applicable calendar year exceed Expenses for the Base Year. For purposes
hereof, the "Base Year" shall mean the calendar year 1995. Tenant's Pro Rata
Share with respect to Taxes of increases in Taxes and Tenant's Pro Rata Share
with respect to Expenses of increases in Expenses shall be computed separate
and independent of each other prior to being added together to determine the
"Excess." In the event that Taxes and/or Expenses, as the case may be, in any
calendar year decrease below the amount of Taxes or Expenses for the Base
Year, Tenant's Pro Rata Share of Taxes and/or Expenses, as the case may be,
for such calendar year shall be deemed to be $0, it being understood that
Tenant shall not be entitled to any credit or offset if Taxes and/or Expenses
decrease below the corresponding amount for the Base Year. Prior to the
Commencement Date and prior to January 1 of each calendar year during the
Lease Term, or as soon thereafter as practical, Landlord shall make a good
faith estimate of the Excess for the applicable calendar year. On or before
the first day of each month during such calendar year, Tenant shall pay
Landlord, as Additional Base Rental, a monthly installment equal to one-
twelfth of Tenant's Pro Rata Share of Landlord's estimate of the Excess.
Landlord shall have the right from time to time during any such calendar year
to revise the estimate of the Excess for such year and provide Tenant with a
revised statement therefor, and thereafter the amount Tenant shall pay each
month shall be based upon such revised estimate. If Landlord does not provide
Tenant with an estimate of the Excess by January 1 of any calendar year,
Tenant shall continue to pay a monthly installment based on the previous
year's estimate until such time as Landlord provides Tenant with an estimate
of the Excess for the current year. Upon receipt of such current year's
estimate, an adjustment shall be made for any month during the current year
with respect to which Tenant paid monthly installments of Additional Base
Rental based on the previous years estimate of the Excess. Tenant shall pay
Landlord for any underpayment upon demand. Any overpayment shall, at
Landlord's option, be refunded to Tenant or credited against the installment
of Additional Base Rental due for the month immediately following the
furnishing of such estimate. Any amounts paid by Tenant based on any estimate
shall be subject to adjustment pursuant to Paragraph A below, when actual
Basic Costs are determined for such calendar year.
A. BASIC COSTS RECONCILIATION. As soon as is practical following the end
of each calendar year during the Lease Term, Landlord shall furnish to Tenant
a statement of Landlord's actual Basic Costs and the actual Excess for the
previous calendar year. If for any calendar year the Additional Base Rental
collected for the prior year, as a result of Landlord's estimate of Basic
Costs, is in excess of Tenant's actual Pro Rata Share of the Excess for such
prior year, then Landlord shall refund to Tenant any overpayment (or at
Landlord's option, apply such amount against Additional Base Rental due or to
become due hereunder). Likewise, Tenant shall pay to Landlord, on demand, any
underpayment with respect to the prior year, whether or not the Lease has
terminated prior to receipt by Tenant of a statement for such underpayment, it
being understood that this clause shall survive the expiration of the Lease.
B. DEFINITIONS.
1. "Basic Costs" for any calendar year shall mean the total, computed
in accordance herewith, of Taxes for such calendar year and Expenses for such
calendar year.
2. "Expenses" shall mean all direct and indirect costs and expenses
paid or incurred in each calendar year in connection with operating,
maintaining, repairing, managing and owning the Building and the Project
(inclusive of the Exterior Common Areas), including, without limitation, the
following:
(i) All labor costs for all persons performing services required
or utilized in connection with the operation, repair and maintenance of and
control of access to the Building and the Project, including but not limited
to amounts incurred for wages, salaries and other compensation for services,
payroll, social security, unemployment and other similar taxes, workmen's
compensation insurance, uniforms, disability benefits, pensions,
hospitalization, retirement plans, group insurance or any other similar or
like expenses incurred under the provisions of any collective bargaining
agreement.
(ii) All management fees, the cost of maintaining a management
office at the Building, all fees for legal and accounting services relating to
the Building and the Project, and the cost of an imputed rental value for as
well as the cost of maintaining and operating a fitness/work-out facility,
conference rooms and other common amenity facilities.
(iii) All rental and/or purchase costs of materials, supplies,
hand tools and equipment used in the operation, repair, replacement and
maintenance and the control of access to the Building and the Project.
(iv) All amounts charged to Landlord by contractors and/or
suppliers for services, materials, equipment and supplies furnished in
connection with the operation, repair, maintenance, replacement of and control
of access to any part of the Building, or the Project generally, including the
heating, air conditioning, ventilating, plumbing, electrical, elevator and
other systems.
(v) All premiums and deductibles paid by Landlord for fire and
extended coverage insurance, earthquake and extended coverage insurance,
liability and extended coverage insurance, rental loss insurance, elevator
insurance, boiler insurance and other insurance customarily carried from time
to time by lessors of comparable office buildings or required to be carried by
Landlord's Mortgagee.
(vi) Charges for all utilities, including but not limited to
water, electricity, gas and sewer, but excluding those charges for which
tenants are individually responsible.
(vii) All landscape expenses and costs of repairing, resurfacing
and striping of the parking areas of the Project, if any.
(viii) Cost of all maintenance service agreements, including
those for equipment, alarm service, window cleaning, drapery or venetian blind
cleaning, janitorial services, pest control, uniform supply, landscaping, and
any parking equipment.
(ix) Cost of all other repairs, replacements and general
maintenance of the Project and Building neither specified above nor directly
billed to tenants.
(x) The amortized cost of capital improvements made to the
Building or the Project which are primarily for the purpose of reducing
operating expense costs or otherwise improving the operating efficiency of the
Project or Building or which are required to comply with any laws, rules or
regulations of any governmental authority, the cost of such items to be
amortized over a period of at least five (5) years. Such amortization shall
be in accordance with generally accepted accounting principles and shall
include interest at the rate of fifteen percent (15%) per annum compounded
monthly.
(xi) All rents payable by Landlord under any ground lease or
other lease affecting the Project or the real property of which the Premises
forms a part.
3. "Taxes", shall mean (i) all real estate taxes and assessments on
the Project (plus ten percent (10%) of the land under the existing Southern
Pacific Transportation Company General Office Building), the Building or the
Premises, and taxes and assessments levied in substitution or supplementation
in whole or in part of such taxes, (ii) all personal property taxes for the
Building's personal property, including license expenses, (iii) all franchise
fees, (iv) all taxes imposed on services of Landlord's agents and employees,
(v) all sales, use or other tax, excluding state and/or federal income tax,
now or hereafter imposed by any governmental authority upon Rent received by
Landlord, (vi) all other taxes, fees or assessments now or hereafter levied by
any governmental authority on the Project, the Building or its contents or on
the operation and use thereof (except as relate to specific tenants), and
(vii) all costs and fees incurred in connection with seeking reductions in or
refunds in Taxes including, without limitation, any costs incurred by Landlord
to challenge the tax valuation of the Building, but excluding income taxes.
4. "Exterior Common Areas" shall mean those areas of the Project
which are not located within the Building and which are provided and
maintained for the use and benefit of Landlord and tenants of the Building
generally and the employees, invitees and licensees of Landlord and such
tenants, including, without limitation, any parking garage, plaza, roads,
sidewalks and landscapes.
C. EXCLUSIONS FROM BASIC COSTS. Basic Costs shall not include the cost
of capital improvements (except as above set forth), depreciation, interest
(except as provided above with respect to the amortization of capital
improvements) lease commissions, and principal payments on mortgage and other
non-operating debts of Landlord.
D. OCCUPANCY. Notwithstanding any language in the Lease seemingly to the
contrary, if the Project is not at least ninety-five percent (95%) occupied
during any calendar year of the Lease Term, actual Basic Costs for purposes of
this Exhibit B-2 shall, at Landlord's option, be determined as if the Project
had been at least ninety-five percent (95%) occupied during such year.
E. AUDIT RIGHT. Tenant, at its sole cost and expense, shall have the
right, within ninety (90) days after receiving Landlord's statement of actual
Basic Costs for a particular calendar year, to provide Landlord with written
notice (the "Review Notice") of its intent to review Landlord's books and
records relating to the Basic Costs for such year. Landlord, within thirty
(30) days after receipt of the Review Notice, shall make such books and
records available to Tenant or Tenant's agent for its review at the office of
the Building, provided that if Tenant retains an agent to review Landlord's
books and records for any calendar year, such agent must be CPA firm licensed
to do business in the state in which the Building is located. If Tenant
elects to review Landlord's books and records, within thirty (30) days after
such books and records are made available to Tenant, Tenant shall have the
right to give Landlord written notice stating in reasonable detail any
objection to Landlord's statement of actual Basic Costs for such calendar
year. If Tenant fails to give Landlord written notice of objection within
such thirty (30) day period or fails to provide Landlord with a Review Notice
within the ninety (90) day period provided above, Tenant shall be deemed to
have approved such statements in all respects. Upon Landlord's receipt of a
timely objection notice from Tenant, Landlord and Tenant shall work together
in good faith to resolve the discrepancy between Landlord's statement and
Tenant's review. If Landlord and Tenant determine that Basic Costs are less
than reported, Landlord shall provide Tenant with a credit against future
Additional Base Rental in the amount of such overpayment. Likewise, if
Landlord and Tenant determine that Basic Costs are greater than reported,
Tenant shall forthwith pay the amount of such underpayment to Landlord. Any
information obtained by Tenant pursuant to the provisions of the Section shall
be treated as confidential. Notwithstanding anything herein to the contrary,
Tenant shall not be permitted to examine Landlord's books and records or to
dispute any statement of Basic Costs unless Tenant has paid to Landlord (under
protest, if Tenant so elects) the amount due
as shown on Landlord's statement of actual Basic Costs, said payment (albeit
under protest) being a condition precedent to said examination and/or dispute.
IN WITNESS WHEREOF, Landlord and Tenant have entered into this Lease as of
the date first written above.
WITNESS/ATTEST: LANDLORD: ZML-ONE MARKET LIMITED
PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP
---------------------------------
Name (print): BY: Equity Office Holdings, LLC, a
------------------- Delaware limited liability
company as agent
---------------------------------
Name (print): By:
------------------- -------------------------------------
Name: XXXXXXX X. XXXX
-----------------------------------
Title: Vice President, Asset Management
----------------------------------
TENANT: TENERA, INC., A DELAWARE
CORPORATION
WITNESS/ATTEST:
XXXXX DE VOE
--------------------------------- By: XXXXXXX X. XXXXXXXX
Name (print): Xxxxx De Voe -------------------------------------
------------------- Name: Xxxxxxx X. Xxxxxxxx
-----------------------------------
XXXXXX XXXXXX Title: CFO
--------------------------------- ----------------------------------
Name (print): Xxxxxx XxXxxx
-------------------
EXHIBIT C
WORK LETTER
This Exhibit is attached to and made a part of the Lease dated __________,
1995, by and between ZML-ONE MARKET LIMITED PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP ("Landlord") by Equity Office Holdings, LLC, a Delaware limited
liability company, its agent and TENERA, INC., A DELAWARE CORPORATION
("Tenant") for space in the Building located at One Market, San Francisco,
California, commonly known as Spear Tower.
INTENTIONALLY OMITTED, however, Tenant has inspected the Premises and
agrees to accept the same "as is" without any agreements, representations,
understandings or obligations on the part of Landlord to perform any
alterations, repairs or improvements. Any construction, alterations or
improvements made to the Premises shall be made at Tenant's sole cost and
expense. Notwithstanding anything to the contrary, Landlord shall provide
Tenant with an allowance ("Work Allowance") in an amount not exceed Fifty-Six
Thousand Nine Hundred Four and NO/100 Dollars ($56,904.00) (i.e., $6.00 per
rentable square foot of the Premises) (i) toward the cost of performing
improvements to the Premises in preparation for Tenant's occupancy thereof or
(ii) to be applied to Base Rental for the Premises beginning with the third
(3rd) month of the Lease Term until the Work Allowance is reduced to $0. All
such improvements shall be performed in compliance with the terms and
conditions of the Lease, including, without limitation, the prior approval of
Landlord with respect to the improvements to be performed and the contractors
to be retained to perform such improvements. The Work Allowance shall be paid
to Tenant following receipt of the following documentation: full and final
waivers of liens from the general contractor and the subcontractors retained
by Tenant in an amount equal to the portion of the Work Allowance to be
disbursed, completion certificates from Tenant, the general contractor and
Tenant's architect, a sworn contractor's affidavit from the general contractor
and a request to disburse from Tenant containing an approval by Tenant of the
work done, receipted bills covering all labor and materials expended and used
in connection with the improvements. If Tenant has not previously paid the
general contractor for the cost of the improvements, Landlord, at its option,
may pay the Work Allowance directly to the order of the general contractor
that performed the improvements or to the joint order of the general
contractor and all included subcontractors. Notwithstanding anything herein
to the contrary, Landlord shall not be obligated to disburse any portion of
the Work Allowance during the continuance of an uncured default under the
Lease, and Landlord's obligation to disburse shall only resume when and if
such default is cured. The Work Allowance may only be used for the cost of
labor, material and contractors fees for the improvements to the Premises and
the cost of preparing plans and drawings in connection therewith. In no event
shall the Work Allowance be used for the purchase of equipment, furniture and
other items of personal property of Tenant.
IN WITNESS WHEREOF, Landlord and Tenant have entered into this Lease as of
the date first written above.
WITNESS/ATTEST: LANDLORD: ZML-ONE MARKET LIMITED
PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP
---------------------------------
Name (print): BY: Equity Office Holdings, LLC, a
------------------- Delaware limited liability
company as agent
---------------------------------
Name (print): By:
------------------- -------------------------------------
Name: XXXXXXX X. XXXX
-----------------------------------
Title: Vice President, Asset Management
----------------------------------
TENANT: TENERA, INC., A DELAWARE
CORPORATION
WITNESS/ATTEST:
XXXXX DE VOE
--------------------------------- By: XXXXXXX X. XXXXXXXX
Name (print): Xxxxx De Voe -------------------------------------
------------------- Name: Xxxxxxx X. Xxxxxxxx
-----------------------------------
XXXXXX XXXXXX Title: CFO
--------------------------------- ----------------------------------
Name (print): Xxxxxx XxXxxx
-------------------
EXHIBIT D
BUILDING RULES AND REGULATIONS
This Exhibit is attached to and made a part of the Lease dated __________,
1995, by and between ZML-ONE MARKET LIMITED PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP ("Landlord") by Equity Office Holdings, LLC, a Delaware limited
liability company, its agent and TENERA, INC., A DELAWARE CORPORATION
("Tenant") for space in the Building located at One Market, San Francisco,
California, commonly known as Spear Tower.
The following rules and regulations shall apply, where applicable, to the
Premises, the Building, the parking garage associated therewith (if any), the
Project and the appurtenances thereto:
1. Sidewalks, doorways, vestibules, halls, stairways and other similar
areas shall not be obstructed by Tenant or used by Tenant for any purpose
other than ingress and egress to and from the Premises. No rubbish, litter,
trash, or material of any nature shall be placed, emptied, or thrown in those
areas. At no time shall Tenant permit Tenant's employees to loiter in common
areas or elsewhere in or about the Building or Project.
2. Plumbing fixtures and appliances shall be used only for the purposes
for which designed, and no sweepings, rubbish, rags or other unsuitable
material shall be thrown or placed therein. Damage resulting to any such
fixtures or appliances from misuse by Tenant or its agents, employees or
invitees, shall be paid for by Tenant, and Landlord shall not in any case be
responsible therefor.
3. No signs, advertisements or notices shall be painted or affixed on or
to any windows, doors or other parts of the Building, except those of such
color, size, style and in such places as shall be first approved in writing by
Landlord. No nails, hooks or screws shall be driven or inserted into any part
of the Premises or Building except by the Building maintenance personnel, nor
shall any part of the Building be defaced by Tenant.
4. Landlord may provide and maintain in the first floor (main lobby) of
the Building an alphabetical directory board listing all Tenants, and no other
directory shall be permitted unless previously consented to by Landlord in
writing.
5. Tenant shall not place any additional lock or locks on any door in the
Premises or Building without Landlord's prior written consent. A reasonable
number of keys to the locks on the doors in the Premises shall be furnished by
Landlord to Tenant at the cost of Tenant, and Tenant shall not have any
duplicate keys made. All keys shall be returned to Landlord at the expiration
or earlier termination of this Lease.
6. Tenant will refer to Landlord for Landlord's supervision, approval,
and control all contractors, contractor's representatives, and installation
technicians rendering any service to Tenant, before performance of any
contractual service. Such supervisory action by Landlord shall not render
Landlord responsible for any work performed for Tenant. This provision shall
apply to all work performed in the Building, including but not limited to the
installation of telephones, computer wiring, cabling, equipment, electrical
devices, attachments and installations of any nature. Tenant shall be solely
responsible for complying with all applicable laws, codes and ordinances
pursuant to which said work shall be performed.
7. Movement in or out of the Building of furniture or office equipment,
or dispatch or receipt by Tenant of any merchandise or materials which require
the use of elevators, stairways, lobby areas, or loading dock areas, shall be
restricted to hours designated by Landlord. Tenant must seek Landlord's prior
approval by providing in writing a detailed listing of any such activity. If
approved by Landlord, such activity shall be under the supervision of Landlord
and performed in the manner stated by Landlord. Landlord may prohibit any
article, equipment or any other item from being brought into the Building.
Tenant is to assume all risk for damage to articles moved and injury to any
persons resulting from such activity. If any equipment, property, and/or
personnel of Landlord or any of any other tenant is damaged or injured as a
result of or in connection with such activity, Tenant shall be solely liable
for any and all damage or loss resulting therefrom.
8. Landlord shall have the power to prescribe the weight and position of
safes and other heavy equipment or items, which in all cases shall not in the
opinion of Landlord exceed acceptable floor loading and weight distribution
requirements. All damage done to the Building by the installation or removal
of any property of Tenant, or done by Tenant's property while in the Building,
shall be repaired at the expense of Tenant.
9. Corridor doors, when not in use, shall be kept closed.
10. Tenant shall not: (i) make or permit any improper, objectionable or
unpleasant noises or odors in the Building, or otherwise interfere in any way
with other tenants or persons having business with them; (ii) solicit business
or distribute, or cause to be distributed, in any portion of the Building any
handbills, promotional materials or other advertising; or (iii) conduct or
permit any other activities in the Building that might constitute a nuisance.
11. No animals, except seeing eye dogs, shall be brought into or kept in,
on or about the Premises.
12. No inflammable, explosive or dangerous fluid or substance shall be
used or kept by Tenant in the Premises or Building. Tenant shall not, without
Landlord's prior written consent, use, store, install, spill, remove, release
or dispose of within or about the Premises or any other portion of the
Property, any asbestos-containing materials or any solid, liquid or gaseous
material now or hereafter considered toxic or hazardous under the provisions
of 42 U.S.C. Section 9601 et seq. or any other applicable environmental law
which may now or hereafter be in effect. If Landlord does give written
consent to Tenant pursuant to the foregoing sentence, Tenant shall comply with
all applicable laws, rules and regulations pertaining to and governing such
use by Tenant, and shall remain liable for all costs of cleanup or removal in
connection therewith.
13. Tenant shall not use or occupy the Premises in any manner or for any
purpose which would injure the reputation or impair the present or future
value of the Premises or the Building; without limiting the foregoing, Tenant
shall not use or permit the Premises or any portion thereof to be used for
lodging, sleeping or for any illegal purpose.
14. Tenant shall not take any action which would violate Landlord's labor
contracts affecting the Building or which would cause any work stoppage,
picketing, labor disruption or dispute, or any interference with the business
of Landlord or any other tenant or occupant of the Building or with the rights
and privileges of any person lawfully in the Building. Tenant shall take any
actions necessary to resolve any such work stoppage, picketing, labor
disruption, dispute or interference and shall have pickets removed and, at the
request of Landlord, immediately terminate at any time any construction work
being performed in the Premises giving rise to such labor problems, until such
time as Landlord shall have given its written consent for the resumption of
such work. Tenant shall have no claim for damages of any nature against
Landlord or any of the Landlord Related Parties in connection therewith, nor
shall the date of the commencement of the Term be extended as a result
thereof.
15. Tenant shall utilize the termite and pest extermination service
designated by Landlord to control termites and pests in the Premises. Tenant
shall bear the cost and expense of such extermination services, provided that
Tenant shall not be obligated to pay more for its participation in such
termite and pest extermination services than the prevailing competitive rates
charged by reputable independent termite and pest control exterminators for
the same service on a direct and individual basis.
16. Tenant shall not install, operate or maintain in the Premises or in
any other area of the Building, any electrical equipment which does not bear
the U/L (Underwriters Laboratories) seal of approval, or which would overload
the electrical system or any part thereof beyond its capacity for proper,
efficient and safe operation as determined by Landlord, taking into
consideration the overall electrical system and the present and future
requirements therefor in the Building. Tenant shall not furnish any cooling
or heating to the Premises, including, without limitation the use of any
electronic or gas heating devices, without Landlord's prior written consent.
17. Tenant shall not operate or permit to be operated on the Premises any
coin or token operated vending machine or similar device (including, without
limitation, telephones, lockers, toilets, scales, amusement devices and
machines for sale of beverages, foods, candy, cigarettes or other goods),
except for those vending machines or similar devices which are for the sole
and exclusive use of Tenant's employees, and then only if such operation does
not violate the lease of any other tenant of the Building.
18. Bicycles and other vehicles are not permitted inside or on the
walkways outside the Building, except in those areas specifically designated
by Landlord for such purposes.
19. Landlord may from time to time adopt appropriate systems and
procedures for the security or safety of the Building, its occupants, entry
and use, or its contents. Tenant, Tenant's agents, employees, contractors,
guests and invitees shall comply with Landlord's reasonable requirements
relative thereto.
20. Landlord shall have the right to prohibit the use of the name of the
Building or any other publicity by Tenant that in Landlord's opinion may tend
to impair the reputation of the Building or its desirability for Landlord or
other tenants. Upon written notice from Landlord, Tenant will refrain from
and/or discontinue such publicity immediately.
21. Tenant shall carry out Tenant's permitted repair, maintenance,
alterations, and improvements in the Premises only during times agreed to in
advance by Landlord and in a manner which will not interfere with the rights
of other tenants in the Building.
22. Canvassing, soliciting, and peddling in or about the Building is
prohibited. Tenant shall cooperate and use its best efforts to prevent the
same.
23. At no time shall Tenant permit or shall Tenant's agents, employees,
contractors, guests, or invitees smoke in any common area of the Building,
unless such common area has been declared a designated smoking area by
Landlord.
24. Tenant shall observe Landlord's rules with respect to maintaining
standard window coverings at all windows in the Premises so that the Building
presents a uniform exterior appearance. Tenant shall ensure that to the
extent reasonably practicable, window coverings are closed on all windows in
the Premises while they are exposed to the direct rays of the sun.
25. All deliveries to or from the Premises shall be made only at such
times, in the areas and through the entrances and exits designated for such
purposes by Landlord. Tenant shall not permit the process of receiving
deliveries to or from the Premises outside of said areas or in a manner which
may interfere with the use by any other tenant of its premises or of any
common areas, any pedestrian use of such area, or any use which is
inconsistent with good business practice.
26. The work of cleaning personnel shall not be hindered by Tenant after
5:30 p.m., and such cleaning work may be done at any time when the offices are
vacant. Windows, doors and fixtures may be cleaned at any time. Tenant shall
provide adequate waste and rubbish receptacles necessary to prevent
unreasonable hardship to Landlord regarding cleaning service.
IN WITNESS WHEREOF, Landlord and Tenant have entered into this Lease as of
the date first written above.
WITNESS/ATTEST: LANDLORD: ZML-ONE MARKET LIMITED
PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP
---------------------------------
Name (print): BY: Equity Office Holdings, LLC, a
------------------- Delaware limited liability
company as agent
---------------------------------
Name (print): By:
------------------- -------------------------------------
Name: XXXXXXX X. XXXX
-----------------------------------
Title: Vice President, Asset Management
----------------------------------
TENANT: TENERA, INC., A DELAWARE
CORPORATION
WITNESS/ATTEST:
XXXXX DE VOE
--------------------------------- By: XXXXXXX X. XXXXXXXX
Name (print): Xxxxx De Voe -------------------------------------
------------------- Name: Xxxxxxx X. Xxxxxxxx
-----------------------------------
XXXXXX XXXXXX Title: CFO
--------------------------------- ----------------------------------
Name (print): Xxxxxx XxXxxx
-------------------
EXHIBIT E
ADDITIONAL TERMS
This Exhibit is attached to and made a part of the Lease dated __________,
1995, by and between ZML-ONE MARKET LIMITED PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP ("Landlord") by Equity Office Holdings, LLC, a Delaware limited
liability company, its agent and TENERA, INC., A DELAWARE CORPORATION
("Tenant") for space in the Building located at One Market, San Francisco,
California, commonly known as Spear Tower.
(I) RENEWAL OPTION
A. Tenant shall have the right to extend the Lease Term for one
additional period of three (3) years commencing on the day following the
Termination Date of the initial Lease Term and ending on the last day of the
thirty-sixth (36th) month anniversary of the Termination Date (the "Renewal
Term"), if:
1. Landlord receives notice of exercise ("Initial Renewal Notice")
not less than nine (9) full calendar months prior to the expiration of the
initial Lease Term and not more than twelve (12) full calendar months prior to
the expiration of the initial Lease Term; and
2. Tenant is not in default under the Lease beyond any applicable
cure periods at the time that Tenant delivers its Initial Renewal Notice or at
the time Tenant delivers its Binding Renewal Notice; and
3. No part of the Premises is sublet at the time that Tenant delivers
its Initial Renewal Notice or at the time Tenant delivers its Binding Renewal
Notice; and
4. The Lease has not been assigned prior to the date that Tenant
delivers its Initial Renewal Notice or prior to the date Tenant delivers its
Binding Renewal Notice; and
5. Tenant executes and returns the Renewal Amendment (hereinafter
defined) within fifteen (15) days after its submission to Tenant.
B. The initial Base Rental rate per rentable square foot for the Premises
during the Renewal Term shall equal the Prevailing Market (hereinafter
defined) rate per rentable square foot for the Premises.
C. Tenant shall pay Additional Base Rental (i.e. Basic Costs) for the
Premises during the Renewal Term in accordance with Exhibit B-2 of the Lease.
D. Within thirty (30) days after receipt of Tenant's Initial Renewal
Notice, Landlord shall advise Tenant of the applicable Base Rental rate for
the Premises for the Renewal Term. Tenant, within fifteen (15) days after the
date on which Landlord advises Tenant of the applicable Base Rental rate for
the Renewal Term, shall either (i) give Landlord final binding written notice
("Binding Notice") of Tenant's exercise of its option, or (ii) if Tenant
disagrees with Landlord's determination, provide Landlord with written notice
of rejection (the "Rejection Notice"). If Tenant fails to provide Landlord
with either a Binding Notice or Rejection Notice within such fifteen (15) day
period, Tenant's Renewal Option shall be null and void and of no further force
and effect. If Tenant provides Landlord with a Binding Notice, Landlord and
Tenant shall enter into the Renewal Amendment upon the terms and conditions
set forth herein. If Tenant provides Landlord with a Rejection Notice,
Landlord and Tenant shall work together in good faith to agree upon the
Prevailing Market Base Rental rate for the Premises during the Renewal Term.
Upon agreement Tenant shall provide Landlord with Binding Notice and Landlord
and Tenant shall enter into the Renewal Amendment in accordance with the terms
and conditions hereof. Notwithstanding the foregoing, if Landlord and Tenant
are unable to agree upon the Prevailing Market Base Rental rate for the
Premises within thirty (30) days after the date on which Tenant provides
Landlord with a Rejection Notice, Tenant's Renewal Option shall be null and
void and of no force and effect.
E. If Tenant is entitled to and properly exercises its Renewal Option,
Landlord shall prepare an amendment (the "Renewal Amendment") to reflect
changes in the Base Rental, Lease Term, Termination Date and other appropriate
terms. The Renewal Amendment shall be:
1. sent to Tenant within a reasonable time after receipt of the
Renewal Notice; and
2. executed by Tenant and returned to Landlord in accordance with
paragraph A.5. above.
F. For purposes hereof, "Prevailing Market" shall mean the arms length
fair market annual rental rate per rentable square foot under renewal leases
and amendments entered into on or about the date on which the Prevailing
Market is being determined hereunder for space comparable to the Premises in
the Building and office buildings comparable to the Building in the San
Francisco bay area. The determination of Prevailing Market shall take into
account any material economic differences between the terms of this Lease and
any comparison lease, such as rent abatements, construction costs and other
concessions and the manner, if any, in which the landlord under any such lease
is reimbursed for operating expenses and taxes. The determination of
Prevailing Market shall also take into consideration any reasonably
anticipated changes in the Prevailing Market rate from the time such
Prevailing Market rate is being determined and the time such Prevailing Market
rate will become effective under this Lease.
IN WITNESS WHEREOF, Landlord and Tenant have entered into this Lease as of
the date first written above.
WITNESS/ATTEST: LANDLORD: ZML-ONE MARKET LIMITED
PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP
---------------------------------
Name (print): BY: Equity Office Holdings, LLC, a
------------------- Delaware limited liability
company as agent
---------------------------------
Name (print): By:
------------------- -------------------------------------
Name: XXXXXXX X. XXXX
-----------------------------------
Title: Vice President, Asset Management
----------------------------------
TENANT: TENERA, INC., A DELAWARE
CORPORATION
WITNESS/ATTEST:
XXXXX DE VOE
--------------------------------- By: XXXXXXX X. XXXXXXXX
Name (print): Xxxxx De Voe -------------------------------------
------------------- Name: Xxxxxxx X. Xxxxxxxx
-----------------------------------
XXXXXX XXXXXX Title: CFO
--------------------------------- ----------------------------------
Name (print): Xxxxxx XxXxxx
-------------------