Exhibit 10.11
SECOND AMENDMENT TO STANDARD FORM LEASE
THIS SECOND AMENDMENT TO STANDARD FORM LEASE (the "Amendment") is made
as of January 16, 1997, by and between STATE OF CALIFORNIA PUBLIC EMPLOYEES'
RETIREMENT SYSTEM, an Agency of the State of California ("Landlord"), and FORTE
SOFTWARE, INC., a Delaware corporation ("Tenant"), with reference to the
following facts:
A. Landlord and Tenant entered into that certain Standard Form Lease,
dated for reference purposes as of December 1, 1994, as amended by that certain
First Amendment to Standard Form Lease, dated as of January 31, 1996
(collectively, the "Lease"). Each capitalized term used in this Amendment, but
not defined herein, shall have the meaning ascribed to it in the Lease.
B. Tenant is concurrently entering into a Sublease with ICF ▇▇▇▇▇▇
Engineers, Inc., an Ohio corporation (the "Sublease"), to sublease certain
premises in the Building located on the 6th and 7th floors thereof (the
"Sublease Premises"). In connection with entering into the Sublease, Tenant
desires to extend the Term of the Lease pursuant to Lease Addendum No. 1
attached to the Lease so that the Term Expiration Date under the Lease and the
expiration of the term of the Sublease coincide.
C. Landlord and Tenant desire to enter into this Amendment to evidence
Tenant's exercise of its option to extend the Term (as modified by this
Amendment), and to make certain other modifications to the Lease, all as more
particularly set forth herein.
NOW, THEREFORE, the parties agree as follows:
1. Extension of Term. Tenant hereby exercises its option to extend the
Term pursuant to Lease Addendum No. 1; provided, however, notwithstanding the
provisions of Lease ▇▇▇▇▇▇▇▇ ▇▇. ▇, ▇▇▇▇▇▇▇▇ and Tenant agree that the Term
Expiration Date shall be June 30, 2000. Accordingly, the Lease is amended as
follows:
(a) The description of the Term Expiration Date in the Basic Lease
Information is hereby deleted and restated in its entirety as follows: "June 30,
2000 for all of the Leased Premises"; and
(b) Lease Addendum No. 1 is hereby deleted in its entirety and shall be
of no further force or effect.
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2. Base Rent. The description of Base Rent set forth in the Basic Lease
Information is hereby deleted and restated in its entirety as follows:
"During the period beginning on the Term Commencement Date and
ending on October 31, 1998: $1.65 per square foot of Net Rentable Area
per month for the 15th Floor Premises and the 17th Floor Premises;
$1.75 per square foot of Net Rentable Area per month for the 17th Floor
Expansion Premises; and $1.10 per square foot of Net Rentable Area per
month for the 24th Floor Premises for the first month Tenant occupies
the 24th Floor Premises and $1.71 per square foot of Net Rentable Area
per month thereafter for the 24th Floor Premises. During the period
beginning on November 1, 1998 and ending on the Term Expiration Date:
$1.85 per square foot of Net Rentable Area per month for the Leased
Premises."
3. Security Deposit. Concurrently herewith, Tenant shall deliver to
Landlord the amount of twenty-two thousand eight hundred one dollars ($22,801),
which amount shall be held by Landlord as part of Tenant's Security Deposit. The
amount of the Security Deposit set forth in the Basic Lease Information is
hereby deleted and restated in its entirety as follows: "$96,428."
4. Basic Services.
(a) Section 4.1(b)(iv) of the Lease is hereby deleted and restated in
its entirety as follows:
"(iv) Electrical facilities to provide sufficient power for personal
computers and other office machines of similar low electrical
consumption, but not including electricity required for data
processing, communications, UPS or power conditioning or supplementary
air conditioning. Any electrical load which singly consumes more than
0.5 kilowatts at rated capacity or requires a voltage other than 120
volts single-phase shall be conclusively deemed to require extra
services. Total convenience outlet circuits that are loaded in excess
or 0.73 kilowatts per hour per square foot per month (assessed on a per
floor basis for full floor occupancy and pro rata share for
multi-tenant occupancy) shall be conclusively deemed to require extra
services. All panels, circuits and disconnects which are subject to the
above conditions shall be installed with check meters that shall be
monitored by Landlord and used as a means for billing monthly the
excess services based on the average cost per kilowatt hour for the
Building for the month that electrical consumption exceeded any such
standard. Such check meters shall be installed at Tenant's sole cost
and expense."
(b) Notwithstanding any contrary provision set forth in the Sublease:
Landlord and Tenant agree that the provisions of this section 4 shall also apply
to Tenant's consumption of electricity in the Sublease Premises; and Tenant
agrees to pay to Landlord, as Additional Rent, for any excess electrical service
provided to Tenant in the Sublease Premises in accordance with the Lease as if
the Sublease Premises were demised to Tenant pursuant to the Lease.
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5. Wiring and Cables.
(a) The following new subsection is hereby added to the end of Section
5.8 of the Lease:
"(d) In no event shall Tenant install any electrical wiring or
voice or data cables above any ceiling in any portion of the Leased
Premises unless such wiring or cables are installed within existing
raceways and chases, or such other raceways, chases or equipment as may
be acceptable to Landlord in its sole and absolute discretion. If at
any time Landlord determines that Tenant has violated the foregoing
provisions, then Landlord may, at its option, require Tenant (at
Tenant's sole cost and expense) to remove all such wiring, cables and
any related equipment that was not previously approved by Landlord in
accordance with this Section 5.8(d), and to repair all damage resulting
from such installation or removal. Tenant's obligations under this
Section 5.8(d) shall survive the expiration or earlier termination of
this Lease."
(b) Notwithstanding any contrary provision set forth in the Sublease,
Landlord and Tenant agree that the provisions of this section 5 shall also apply
to Tenant's installation of wiring and cables in the Sublease Premises.
6. Termination Right.
(a) Section 6.21 of the Lease (Termination Right) is hereby deleted and
restated in its entirety as follows:
"6.21 Termination Right. Provided Tenant is not in default under or
breach of this Lease either at the time Tenant delivers its Termination
Notice (as defined below) or on the Termination Date (as defined
below), then Tenant may elect to terminate this Lease as of the last
day of any calendar month on or after June 30, 1999 (the 'Termination
Date') by delivering to Landlord written notice of Tenant's election
(the 'Termination Notice'). The Termination Notice must specify the
Termination Date and must be received by Landlord on or before December
31, 1998. If Landlord does not receive the Termination Notice on or
before December 31, 1998, then Tenant shall not have any termination
rights under this Lease and the provisions of this Section 6.21 shall
be of no further force or effect. As consideration for Tenant's
termination of this Lease, Tenant shall pay to Landlord, concurrently
with Tenant's delivery of its Termination Notice, by certified or bank
cashier's check or by a wire transfer of funds, an amount equal to the
sum of the following amounts: (a) an amount equal to two (2) months'
Base Rent in effect on the Termination Date; plus (b) the amount set
forth on Schedule 1 attached hereto and incorporated herein by
reference next to the month during which the Termination Date will
occur (for example, if the Termination Date selected by Tenant is July
31, 1999, then Tenant shall pay the sum of two (2) months' Base Rent at
the rate applicable to July, 1999, plus the
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amount set forth on Schedule 1 for July 31, 1999. Landlord and Tenant
agree that Schedule 1 attached hereto is calculated based upon a tenant
improvement allowance of $521,230, amortized over the remaining Term of
this Lease at an interest rate of eleven percent (11%) per annum, and
each amount set forth on Schedule 1 is the remaining balance due as of
the last day of the corresponding month. Tenant's right to terminate
this Lease under this Section 6.21 is personal to Tenant, may not be
exercised by or be assigned to any person or entity other than Tenant
(including, without limitation, any subtenant), and shall terminate and
be of no further effect upon any assignment of this Lease."
(b) Schedules 1, 2 and 3 attached to the Lease are hereby deleted and
replaced in their entirety with Schedule 1 attached to this Amendment.
7. Waiver of Jury Trial. The following new section is hereby added to
the Lease as Section 6.24:
"6.24 Mutual Waivers of Jury Trial and Certain Damages. Tenant
and Landlord each hereby expressly, irrevocably, fully and forever
releases, waives and relinquishes any and all right to trial by jury
and all right to receive punitive, exemplary and consequential damages
from the other (or any past, present or future board member, trustee,
director, officer, employee, agent, representative, or advisor of the
other) in any claim, demand, action, suit, proceeding or cause of
action in which Tenant and Landlord are parties, which in any way
(directly or indirectly) arises out of, results from or relates to any
of the following, in each case whether now existing or hereafter
arising and whether based on contract or tort or any other legal basis:
this Lease; any past, present or future act, omission, conduct or
activity with respect to this Lease; any transaction, event or
occurrence contemplated by this Lease; the performance of any
obligation or the exercise of any right under this Lease; or the
enforcement of this Lease. Tenant and Landlord each agrees that this
Lease constitutes written consent that trial by jury shall be waived in
any such claim, demand, action, suit, proceeding or other cause of
action pursuant to California Code of Civil Procedure section 631 and
agrees that Tenant and Landlord each shall have the right at any time
to file this Lease with the clerk or judge of any court in which any
such claim, demand, action, suit, proceeding or other cause of action
may be pending as statutory written consent to waiver of trial by jury
in accordance with California Code of Civil Procedure section 631.
Initials: ____________________"
8. Tenant Improvements. The provisions of Exhibit A (Construction
Agreement) attached hereto (the "Construction Agreement") are incorporated
herein by reference with regard to improvements that Tenant may elect to make to
the Leased Premises or the Sublease Premises. All references in the Lease to the
Construction Agreement shall hereafter mean Exhibit A to this Amendment rather
than Exhibit B to the Lease.
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9. Brokers. Landlord has engaged the services of Alliance Management &
Leasing in connection with this Amendment. Tenant represents and warrants that
it has not engaged the services of or agreed to compensate any broker, finder or
other person in connection with this Amendment. Each party shall indemnify,
defend and hold the other party harmless from and against any claims,
liabilities, damages and expenses (including, without limitation, attorneys'
fees and costs of defense) for fees, commissions or other amounts sought on the
basis of any agreement or other commitment made or alleged to have been made by
the party giving the indemnity.
10. No Other Amendment; Conflict. Except as set forth in this
Amendment, the provisions of the Lease shall remain in full force. If the
provisions of this Amendment conflict with the provisions of the Lease, then the
provisions of this Amendment shall prevail.
11. Counterparts. This Amendment may be signed in multiple counterparts
which, when signed by all parties, shall constitute a binding agreement.
IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date first set forth above.
LANDLORD: STATE OF CALIFORNIA PUBLIC EMPLOYEES'
RETIREMENT SYSTEM, an Agency
of the State of California
By LaSalle Advisors Limited Partnership,
its authorized agent
By ▇▇▇▇▇▇ ▇. ▇▇▇▇
-----------------
Its Vice President
----------------
By ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
----------------------
Its Vice President
--------------
TENANT: FORTE SOFTWARE, INC., a California corporation
By ▇▇▇▇▇▇ ▇▇▇▇▇▇
Its Director of Legal Affairs
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Schedule 1
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Termination Payments
--------------------
Termination Date Amount
---------------- ------
June 30, 1999 $324,076
July 31, 1999 $298,404
August 31, 1999 $272,497
September 30, 1999 $246,353
October 31, 1999 $219,969
November 30, 1999 $193,343
December 31, 1999 $166,473
January 31, 2000 $139,356
February 29, 2000 $111,991
March 31, 2000 $ 84,375
April 30, 2000 $ 56,507
May 31, 2000 $ 28,382
June 30, 2000 $ 0
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Exhibit A
Construction Agreement
This Construction Agreement ("Agreement") is made as of
January 16, 1997, between STATE OF CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT
SYSTEM, an Agency of the State of California ("Landlord"), and FORTE SOFTWARE,
INC., a California corporation ("Tenant"), in connection with the execution of
that certain Second Amendment to Standard Form Lease between Landlord and
Tenant, dated as of January 16, 1997 (the "Amendment"). The Amendment amends
that certain Standard Form Lease, dated for reference purposes as of December 1,
1994, between Landlord and Tenant, as amended by that certain First Amendment to
Standard Form Lease, dated as of January 31, 1996 (collectively, the "Original
Lease"). The Original Lease and the Amendment are collectively referred to
herein as the "Lease." Each capitalized term used in this Agreement, but not
defined herein, shall have the meaning ascribed to it in the Lease. Landlord and
Tenant hereby agree as follows:
General
The purpose of this Agreement is to set forth: how
improvements to the Leased Premises or the Sublease Premises that Tenant may
desire to construct from time to time (the "Improvements") are to be
constructed; who will do the construction of the Improvements; who will pay for
the construction of the Improvements; and the time schedule for Substantial
Completion of the construction of the Improvements.
The provisions of the Lease, except where clearly inconsistent
or inapplicable to this Agreement, are incorporated into this Agreement.
Landlord and Tenant acknowledge that Tenant will not take
possession of the entire Sublease Premises at the commencement of the Sublease
and, therefore, that the Improvements in the Sublease Premises will be
constructed in phases. As used in this Agreement, a "Phase of Construction"
means a period commencing when Contractor (as defined in Section 5(I)) begins
work on Improvements within the Leased Premises or the Sublease Premises and
ending when Contractor substantially completes such work and withdraws all of
its equipment and personnel from the Premises. Landlord and Tenant further
acknowledge that Tenant presently intends to have the Improvements to the
Sublease Premises conducted in two Phases of Construction, with the first Phase
of Construction encompassing the Improvements to one-half of the seventh floor
of the Building and the second Phase of Construction encompassing the
Improvements to the second half of the seventh floor and all of the sixth floor
of the Building. The foregoing shall not, however, limit the Phases of
Construction for Tenant's Improvements under this Agreement.
Delivery of Premises to Tenant and Condition of Premises. Landlord has
previously delivered possession of the Leased Premises to Tenant in accordance
with the Lease; and Landlord has no obligation to deliver to Tenant possession
of the Sublease Premises. Tenant agrees that Landlord has no obligation to cause
the Leased Premises or the Sublease Premises to comply with any Laws (as defined
in Section 4) (including, without limitation, the Americans with Disabilities
Act of 1990, Pub. L. 101-336) which are applicable solely due to the
construction of any Improvements; and Tenant, at its sole cost, shall cause the
Leased Premises and the Sublease Premises to comply with all such Laws in
connection with the construction of any Improvements. Except as set forth in
this Section 2, nothing in this Agreement shall be construed to limit Landlord's
obligation to comply with Laws in accordance with the Lease.
Preparation/Approval of Space Plans. When Tenant desires that any
Improvements be constructed, Tenant shall provide Designer (as defined in
Section 4) with such information as is reasonably requested by Designer to
permit preparation of a space plan (the "Space Plan") for such Improvements.
Tenant, at its sole cost, shall cause Designer to deliver to Landlord such Space
Plan for Landlord's approval, which approval shall not be unreasonably withheld
or delayed.
Selection of Designer/Architect. Subject to Landlord's prior written
approval (which approval shall not be unreasonably withheld or delayed), Tenant
shall select a designer or architect (collectively, "Designer") who is familiar
with the Building and with all applicable laws, statutes, codes, rules and
regulations of governmental agencies and authorities having jurisdiction
(collectively, "Laws"), and with the regulations and procedures promulgated by
Landlord, in each instance applicable to tenant construction in the Building.
Designer shall prepare working drawings and specifications for the applicable
Improvements at Tenant's sole
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cost and expense (the "Working Drawings"). Landlord acknowledges that Tenant
initially has selected SPACE as its Designer and Landlord hereby approves of
such selection.
Preparation of Plans and Construction Schedule and Procedures.
Landlord, at Landlord's sole cost and expense, shall provide instructions and
Building background drawings to Designer to complete the Working Drawings for
the applicable Improvements. Landlord shall be responsible for the construction
of such Improvements, in accordance with the following schedule:
Tenant shall cause Designer to submit to Landlord the
applicable Working Drawings prepared by Designer with respect to the
Improvements to be constructed pursuant thereto.
Landlord shall, as soon as reasonably possible but in all
events within ten (10) business days of receipt, approve the Working Drawings or
designate by notice to Tenant the specific changes Landlord reasonably requires
to be made to the Working Drawings as a condition to Landlord's approval
thereof. Tenant shall cause Designer to make such changes as soon as reasonably
possible and re-submit the Working Drawings for Landlord's review. Landlord
shall, as soon as reasonably possible but in all events within ten (10) business
days of receipt, approve the revised Working Drawings or designate by notice to
Tenant what further changes Landlord reasonably requires to be made to the
Working Drawings, whereupon Tenant shall cause Designer to make such further
changes and re-submit the Working Drawings. This procedure shall be repeated
until the Working Drawings are finally approved by Landlord. Tenant's failure to
receive Landlord's notice designating changes to the Working Drawings (or any
revision thereof) within the applicable time frame specified above shall be
conclusively deemed Landlord's approval thereof.
Tenant, at its sole cost, shall cause the Engineer (as defined
below) to submit to Landlord, after Landlord has approved the Working Drawings,
engineering drawings showing complete plans for telephone outlets, electrical,
plumbing work, heating, ventilating and air conditioning in connection with such
Improvements (the "Engineering Drawings"). The Engineering Drawings shall be
prepared by a mechanical and electrical engineer (the "Engineer") selected by
Tenant and approved by Landlord, which approval shall not be unreasonably
withheld or delayed. Landlord acknowledges that Tenant initially has selected
▇▇▇▇▇ + ▇▇▇▇▇ Consulting Engineers LLP as its Engineer and Landlord hereby
approves of such selection.
Landlord shall, as soon as reasonably possible but in all
events within ten (10) business days of receipt, approve the Engineering
Drawings or designate by notice to Tenant the specific changes Landlord
reasonably requires to be made to the Engineering Drawings. Tenant shall cause
its engineer to make such changes as soon as reasonably possible and re-submit
the Engineering Drawings for Landlord's review. Landlord shall, as soon as
reasonably possible but in all events within ten (10) business days of receipt,
approve the revised Engineering Drawings or designate by notice to Tenant what
further changes Landlord reasonably requires to be made to the Engineering
Drawings, whereupon Tenant shall cause Designer to make such further changes and
re-submit the Engineering Drawings. This procedure shall be repeated until the
Engineering Drawings are finally approved by Landlord. Tenant's failure to so
receive Landlord's notice designating changes to the Engineering Drawings (or
any revision thereof) within the applicable time frame specified above shall be
conclusively deemed Landlord's approval thereof.
After Landlord has approved the Engineering Drawings, Tenant,
at its sole cost, shall submit to Landlord final plans ("Plans"), which shall be
defined as, and shall consist of, complete architectural plans (inclusive of the
approved Working Drawings and the approved Engineering Drawings) and
specifications necessary to allow the Contractor to build the applicable
Improvements in accordance with those final Plans.
Landlord shall, as soon as reasonably possible but in all
events within ten (10) business days of receipt, approve those elements of the
Plans not previously approved by Landlord by delivering to Tenant a notice in
the form of Exhibit 1 attached hereto, or designate by notice to Tenant the
specific changes Landlord reasonably requires to be made to such Plans. Tenant
shall cause such changes to be made as soon as reasonably possible and re-submit
the Plans for Landlord's review. Landlord shall, as soon as reasonably possible
but in all events within ten (10) business days of receipt, approve the revised
Plans or designate by notice to Tenant what further changes Landlord reasonably
requires to be made to the Plans, whereupon Tenant shall cause such further
changes to be made and re-submit the Plans. This procedure shall be repeated
until the Plans are finally approved by Landlord. Tenant's failure to so receive
Landlord's notice designating changes to the Plans (or revisions thereof) within
the applicable time frame specified above shall be conclusively deemed
Landlord's approval thereof.
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On or before the date that Landlord finally approves the
Plans, Landlord may elect by notice to Tenant (which notice, if not previously
delivered, shall be included in Landlord's notice approving the Plans in the
form of Exhibit 1 attached hereto), to advise Tenant that Landlord shall have
the right to require Tenant to remove such Improvements on the expiration or
earlier termination of the Term of the Lease, or upon expiration of the
scheduled term of the Sublease or earlier termination thereof if Tenant does not
remain in possession of the Sublease Premises pursuant to the Non-Disturbance
Agreement dated of even date herewith, as applicable (the "Removal Notice"). In
determining whether to deliver a Removal Notice for Improvements to be made in
any subsequent Phase of Construction, Landlord shall apply the same criteria
applied by Landlord in determining which of the Improvements in the first Phase
of Construction are subject to a Removal Notice. (Such criteria may include,
without limitation, special purpose areas, the quality of construction, density
of use, and the balance between private offices and open spaces.)
Notwithstanding any contrary provision of the Sublease or the ICF Lease (as
defined in the Sublease): Landlord agrees that Tenant shall not be obligated to
remove any Improvements from the Sublease Premises unless Landlord has delivered
to Tenant the Removal Notice; and Tenant agrees that if Landlord has delivered
to Tenant the Removal Notice, Landlord shall have the right to require Tenant to
remove such Improvements on the expiration of the scheduled term of the
Sublease, or upon earlier termination thereof if Tenant does not remain in
possession of the Sublease Premises pursuant to the Non-Disturbance Agreement,
and Tenant shall restore the Sublease Premises to the condition existing prior
to the installation of such Improvements and shall repair all damage resulting
therefrom. Where Landlord has delivered a Removal Notice with respect to
particular Improvements, Landlord shall have sole discretion to enforce or to
waive the requirement that Tenant remove such Improvements; provided, however,
that any waiver of such removal requirement may apply to less than all of the
Improvements initially designated in such Removal Notice only where the partial
application of such removal requirement will not materially increase Tenant's
costs of complying with the Removal Notice.
Within fifteen (15) days after Landlord finally approves the
Plans for any Improvements, and within fifteen (15) days after Landlord approves
any change thereto in accordance with Section 6, and within fifteen (15) days
after any such Improvements are Substantially Complete, Tenant shall deliver to
Landlord invoices or other reasonably satisfactory evidence of all costs and
expenses incurred by Tenant in connection with such Improvements.
Landlord shall cause the general contractor selected by
Landlord ("Contractor") to construct the applicable Improvements strictly in
accordance with the approved Plans and the schedule established pursuant to
Section 6, at Tenant's sole and entire cost (subject to Tenant's ability to
utilize the Tenant Improvement Allowance (as defined in Section 7)). Landlord
initially has elected to use Paradigm as the Contractor. If Landlord elects to
use any Contractor other than Paradigm, Tenant shall have the right to approve
such Contractor, which approval will not be unreasonably withheld or delayed.
Landlord agrees that any subcontractors who will perform work estimated to cost
in excess of five thousand dollars ($5,000) shall be selected by Landlord or
Contractor, from a list approved by Tenant, based on competitive bidding in
accordance with Landlord's current competitive bidding practices. Tenant also
shall have the right to approve the construction contract between Landlord and
Contractor ("Construction Contract"), which approval will not be unreasonably
withheld or delayed. Landlord shall include in the Construction Contract such
provisions governing incentives for completion or penalties for delayed
completion as may be mutually acceptable to Tenant and Contractor, provided that
any delay in the commencement of work under the Construction Contract which is
requested by Tenant to accommodate the negotiation of such incentives or
penalties shall be a Tenant Delay.
Landlord shall provide customary construction management and
supervision services with respect to all work performed by or under the
direction of Contractor. In connection therewith, with respect to each Phase of
Construction of the Improvements to be constructed hereunder, Tenant shall pay
to Landlord a construction supervision fee (the "Supervision Fee") equal to the
sum of (i) five and one-half percent (5.5%) of the first one hundred thousand
dollars ($100,000) of all costs to construct the Improvements in such Phase of
Construction, plus (ii) four and one-half percent (4.5%) of all costs to
construct the Improvements in such Phase of Construction in excess of one
hundred thousand dollars ($100,000) up to a maximum of one million dollars
($1,000,000), plus (iii) two and one-half percent (2.5%) of all costs to
construct the Improvements in such Phase of Construction in excess of one
million dollars ($1,000,000). For purposes of calculating the Supervision Fee,
the costs to construct the Improvements in a particular Phase of Construction
shall be the amount payable to the Contractor under the Construction Contract,
which does not include the fees of the Designer and the Engineer. The
Supervision Fee shall be included in the Estimated Costs (as defined in
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Section 7) and shall be paid in accordance with Section 7. Any failure by Tenant
to comply with the dates and time limits in this Agreement, or failure to pay
when due any sums due to the Contractor, which causes a delay in such
construction, shall automatically constitute Tenant Delays (as defined in
Section 8).
Tenant agrees and understands that Landlord shall not be the
guarantor of, nor responsible for, the correctness or accuracy of any Working
Drawings, Engineering Drawings or Plans or compliance of any Working Drawings,
Engineering Drawings or Plans with Laws. The foregoing notwithstanding, Landlord
shall promptly notify Tenant if Landlord discovers any incorrectness or
inaccuracy in the Working Drawings, Engineering Drawings or Plans, or the
failure of same to comply with Laws.
Any change which Tenant makes to any Plans shall be subject to
Landlord's prior written approval in accordance with Section 6. Any such change
which delays Landlord in causing any Improvements to be Substantially Complete
beyond the time that it would have otherwise taken to cause such Improvements to
be Substantially Complete shall also constitute Tenant Delays.
Construction.
The Improvements indicated on the applicable Plans shall be
constructed by Contractor under the supervision and management of Landlord, in
accordance with the Schedule (as defined below) and the Construction Contract.
Landlord shall exercise and cause Contractor to exercise reasonable efforts to
minimize any interference with use of the Leased Premises, the Sublease Premises
and the areas adjacent to the Sublease Premises occupied by ICF ▇▇▇▇▇▇ Engineers
in connection with the construction of the Improvements. The parties
acknowledge, however, that some degree of interference with the use of such
areas is unavoidable given the circumstances under which the Improvements will
be completed.
As used in this Agreement, the "Schedule" shall mean the
schedule for commencement and Substantial Completion of the construction of
Improvements called for under the applicable Plans. The Schedule shall in all
events allow for construction of such Improvements to commence only after: the
Plans for the Improvements have been approved by Landlord as provided in this
Agreement; all necessary permits and approvals for the construction of the
Improvements have been issued by appropriate governmental authorities; the
Construction Contract has been approved by Tenant; and the total costs of
constructing the Improvements have been approved by Tenant. The Schedule shall
be established in each case as follows:
With respect to the Improvements to be constructed in
the first Phase of Construction, the parties currently anticipate (based upon
Contractor's estimate) that construction will commence on or about January 16,
1997, and that such Improvements will be Substantially Complete within ten (10)
weeks after the commencement of construction.
With respect to the Improvements to be constructed
after the first Phase of Construction, Landlord shall provide Tenant, at the
time Landlord approves the Working Drawings, with an estimate of the Schedule
for the applicable Improvements. Thereafter, when Landlord approves the
Engineering Drawings, and again when Landlord approves the Plans, Landlord shall
notify Tenant of any revisions to the estimated Schedule for the applicable
Improvements. Landlord's estimates regarding the Schedule shall be prepared in
consultation with Contractor and shall incorporate reasonable assumptions (based
on information available from Tenant and other sources) as to the commencement
date for construction of the applicable Improvements.
In the event that Tenant requests any changes to the Plans,
Landlord shall not unreasonably withhold its consent to any such changes,
provided the changes do not adversely affect the Building's structure, systems,
equipment, security system or appearance, but if such changes increase the total
cost of the Improvements shown on such Plans, Tenant shall pay such increased
costs to Landlord as provided in Section 7. The costs charged by Landlord to
Tenant caused by Tenant's requesting changes to such Improvements shall be the
amount of money (if any) Landlord has to pay to cause such Improvements, as
reflected by revised Plans, to be constructed above the costs that Landlord
would have had to pay to cause such Improvements to be constructed if no changes
had been made to such Plans, plus any resulting increase in the Supervision Fee.
If such changes delay Landlord's Substantial Completion of the work shown on the
Plans, then such delay shall constitute Tenant Delays. Any other actions of
Tenant, or inaction by Tenant, which delays Landlord in completing such
Improvements shown on the applicable Plans shall also constitute Tenant Delays.
Whenever possible and practical, Landlord will utilize, for the construction of
such Improvements, the items and materials designated in the applicable Plans.
However, whenever Landlord determines in its reasonable judgment that it is
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not practical or efficient to use such materials, Landlord shall have the right,
upon receipt of Tenant's consent, which consent shall not be unreasonably
withheld or delayed, to substitute comparable items and materials. If Tenant
refuses to grant such consent, and Landlord is delayed in causing such
Improvements to be Substantially Complete because of Tenant's failure to permit
the substitution of comparable items and materials, such delay shall constitute
Tenant Delays.
If the Improvements are not Substantially Completed by the
deadline established in the Schedule (as such deadline may be extended for
Tenant Delays and for Force Majeure), Tenant shall have the following rights and
remedies:
Landlord shall enforce against Contractor, for the benefit of
Tenant, all such rights and remedies as may be included in the Construction
Contract for delays in the completion of construction which are attributable to
Contractor.
Where the delay is attributable to Landlord's failure or delay
in performing its obligations under the Construction Contract or this Agreement,
Tenant reserves all rights and remedies (including, without limitation, the
right to recover damages) as may be available at law or in equity which are
caused by Landlord's failure or delay in performing such obligations.
Tenant Improvement Allowance.
Notwithstanding any contrary provision of this Agreement
requiring Tenant to bear all costs of the Improvements, Landlord agrees to pay
costs and expenses incurred (including reimbursement to Tenant for its costs and
expenses) in connection with the design and construction of any Improvements
(including, without limitation, all costs and expenses of plans, permits,
licenses and approvals, demolition expenses, and the Supervision Fee), designed
and constructed pursuant to this Agreement (collectively, "Tenant Improvement
Costs") up to the aggregate amount of five hundred twenty-one thousand two
hundred thirty dollars ($521,230) (based upon ten dollars ($10.00) per square
foot of Net Rentable Area of the Leased Premises) (the "Tenant Improvement
Allowance"). The Tenant Improvement Costs shall not include costs incurred by
Landlord or its agents in reviewing and approving Space Plans, Working Drawings,
Engineering Drawings and Plans. Landlord and Tenant agree such Tenant
Improvement Allowance may be used for the construction of the Improvements;
provided, however, in no event shall the Tenant Improvement Allowance be used to
pay for Tenant's personal property, equipment, furniture, fixtures (including,
without limitation, work stations), telephone equipment or cabling, computer
equipment or cabling, or any similar items, regardless of whether or not such
items are affixed to or built inside interior partitions of the Leased Premises
or the Sublease Premises. Furthermore, Tenant agrees that it shall have no right
to the balance of the Tenant Improvement Allowance, and Landlord shall have no
further obligation to pay any costs or expenses for any Improvements, made or
constructed after December 31, 1998.
As soon as practical after any Plans are approved by Landlord
pursuant to Section 5(f), Landlord shall cause Contractor to determine the
estimated Tenant Improvement Costs in connection with the Improvements called
for thereunder (the "Estimated Costs"), and shall advise Tenant in writing of
the amount of Estimated Costs. Tenant shall approve or disapprove the Estimated
Costs within ten (10) business days after receipt thereof. Landlord's failure to
receive Tenant's notice disapproving the Estimated Costs within the applicable
time frame specified above shall be conclusively deemed Tenant's approval
thereof. Once the Estimated Costs have been approved by Tenant, the same shall
not increase except as a result of (i) changes to the Plans requested or
approved by Tenant, (ii) changes or additions to the Plans required to comply
with Laws as required by Section 2 of this Agreement, (iii) substitutions of
materials requested or approved by Tenant, or (iv) Tenant Delays. If the
Estimated Costs approved by Tenant exceed the amount of the remaining balance of
the Tenant Improvement Allowance, the excess (referred to herein as "Tenant's
Share of Estimated Costs") shall be paid by Tenant as follows:
(1) Tenant's Share of Estimated Costs shall be paid in three
equal installments. The first installment shall be due at the commencement of
the construction work, the second installment shall be due on that date which is
the midpoint between commencement and Substantial Completion of construction
under the applicable Schedule, and the final installment shall be due upon
Substantial Completion of the Improvements. Tenant shall pay the installments of
Tenant's Share of Estimated Costs in cash or immediately available funds.
(2) Promptly after such Improvements are Substantially
Complete, Landlord shall advise Tenant of the actual Tenant Improvement Costs in
connection therewith (the "Actual Costs"). If the Tenant's Share of the
Estimated Costs exceed the Actual Costs for which Tenant is responsible, then
such difference shall be returned to Tenant by Landlord's
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check payable to Tenant. If the Actual Costs for which Tenant is responsible
exceed what Tenant previously has paid as Tenant's Share of Estimated Costs,
Tenant shall pay such excess as Additional Rent in cash or immediately available
funds within ten (10) business days after Landlord delivers to Tenant an invoice
therefor. In the event Tenant must pay any amounts under this Agreement before
any such Improvements are Substantially Complete, then Landlord, at its option,
may cease construction until such amounts are paid, and any delay resulting
therefrom shall be Tenant Delays.
Delays.
The term "Tenant Delays" as used in this Agreement and the
Lease shall mean any delay in the completion of any such Improvements which is
due to any: (1) delay in the giving of authorizations or approvals by Tenant;
(2) delay attributable to the acts or failures to act, whether willful,
negligent or otherwise, of Tenant, its agents or contractors, where such acts or
any failures to act delay the completion of the Improvements; (3) delay
attributable to the interference of Tenant, its agents or contractors with the
completion of any Improvements; or (4) other matter set forth in this Agreement
or the Lease as Tenant Delays.
The term "Force Majeure Delay" as used in the Lease shall mean
and delay in the completion of any Improvements which is attributable to any:
(1) actual delay or failure to perform attributable to any strike, lockout or
other labor or industrial disturbance (whether or not on the part of the
employees of either party hereto), civil disturbance, future order claiming
jurisdiction, act of a public enemy, war, riot, sabotage, blockade, embargo,
inability to secure customary materials, supplies or labor through ordinary
sources by reason of regulation or order of any government or regulatory body;
(2) delay attributable to the failure of Landlord and/or Tenant to secure
building permits and approvals; (3) delay in the Substantial Completion of any
Improvements because of changes in any Laws (including, without limitation, the
Americans with Disabilities Act of 1990, Pub. L. 101-336), or the interpretation
thereof; or (4) delay attributable to lightning, earthquake, fire, storm,
hurricane, tornado, flood, washout, explosion, or any other cause beyond the
reasonable control of the party from whom performance is required, or any of its
contractors or other representatives. Any prevention, delay or stoppage due to
any Force Majeure Delay shall excuse the performance of the party affected for a
period of time equal to any such prevention, delay or stoppage (except the
obligations of either party to pay money, including rent and other charges,
pursuant to this Agreement or the Lease).
IN WITNESS WHEREOF, the parties have executed the Construction
Agreement as of the date first written above.
LANDLORD:
STATE OF CALIFORNIA
PUBLIC EMPLOYEES' RETIREMENT SYSTEM,
an Agency of the State of California
By LaSalle Advisors Limited Partnership, its authorized agent
By ▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------------
Its Vice President
-------------------------------
By ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
----------------------------------------
Its Vice President
--------------------------------
TENANT:
FORTE SOFTWARE, INC.,
a California corporation
By ▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------
Its Director of Legal Affairs
--------------------------------
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Exhibit 1
ALLIANCE MANAGEMENT & LEASING
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
____________________, 199__
VIA HAND DELIVERY
Forte Software, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn:
Re: Approval of Plans Pursuant to Construction Agreement, dated as of
January __, 1997 (the "Agreement")
Dear _____________________________________ :
Pursuant to the Agreement, the undersigned, on behalf of Landlord (as
defined in the Agreement), hereby approves the following final plans and
specifications: [Insert Title of Plans], dated as of , 199___, prepared by
[Insert Name of Architect], bearing Job No. _______________, and consisting of
________ sheets (the "Plans").
[Pursuant to Section 5(g) of the Agreement, Landlord shall have the right
to require Tenant (as defined in the Agreement) to remove the improvements
{described on Schedule 1 attached hereto}{shown on the approved Plans identifed
on Schedule 1 attached hereto}{shown on the approved Plans attached hereto} and
incorporated herein by reference on the expiration or earlier termination of the
term of the Lease (as defined in the Agreement) or the Sublease (as defined in
the Agreement), as applicable.]
Very truly yours,
ALLIANCE MANAGEMENT & LEASING
By
Its __
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SCHEDULE 1
Improvements Which May have to be Removed
[If none, insert the word "NONE."]
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