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Exhibit 10.15
LEASE
BETWEEN
HAYWARD POINT EDEN I LIMITED PARTNERSHIP
("Landlord")
and
RIBOGENE, INC.
("Tenant")
TABLE OF CONTENTS
1. PREMISES
1.1. Premises................................................1
1.2. Landlord's Reserved Rights..............................1
1.3. First Refusal Right.....................................2
2. TERM................................................................2
2.1. Term....................................................2
2.2. Early Possession........................................3
2.3. Delay In Possession
2.4. Construction............................................4
2.5. Acknowledgement Of Lease Commencement...................4
2.6. Holding Over............................................5
2.7. Option To Extend Term...................................5
3. RENTAL..............................................................5
3.1. Minimum Rental..........................................5
3.2. Late Charge.............................................8
4. TAXES ..............................................................8
4.1. Personal Property.......................................8
4.2. Real Property...........................................8
5. OPERATING EXPENSES..................................................9
5.1. Payment Of Operating Expenses...........................9
5.2. Definition Of Operating Expenses........................9
5.3. Determination Of Operating Expenses....................10
5.4. Final Accounting For Lease Year........................10
5.5. Proration..............................................11
6. UTILITIES..........................................................11
6.1. Payment................................................11
6.2. Interruption...........................................11
7. ALTERATIONS........................................................12
7.1. Right To Make Alterations..............................12
7.2. Title To Alterations...................................12
7.3. Tenant Fixtures........................................12
7.4. No Liens...............................................12
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8. MAINTENANCE AND REPAIRS............................................13
8.1. Landlord's Work........................................13
8.2. Tenant's Obligation for Maintenance....................13
(a) Good Order, Condition and Repair..................13
(b) Landlord's Remedy.................................13
(c) Condition Upon Surrender..........................13
9. USE OF PREMISES....................................................14
9.1. Permitted Use..........................................14
9.2. [Omitted.].............................................14
9.3. No Nuisance............................................14
9.4. Compliance With Laws...................................14
9.5. Liquidation Sales......................................15
9.6. Environmental Matters..................................15
10. INSURANCE AND INDEMNITY...........................................16
10.1. Insurance..............................................16
10.2. Quality of Policies and Certificates...................16
10.3. Workers' Compensation..................................16
10.4. Waiver of Subrogation..................................16
10.5. Increase In Premiums...................................17
10.6. Indemnification........................................17
10.7. Blanket Policy.........................................17
11. SUBLEASE AND ASSIGNMENT...........................................17
11.1. Assignment And Sublease Of Premises....................17
11.2. Rights Of Landlord.....................................18
12. RIGHT OF ENTRY AND QUIET ENJOYMENT................................18
12.1. Right Of Entry.........................................18
12.2. Quiet Enjoyment........................................19
13. CASUALTY AND TAKING...............................................19
13.1. Termination Or Reconstruction..........................19
13.2. Tenant's Rights........................................19
13.3. Lease To Remain In Effect..............................20
13.4. Reservation Of Compensation............................20
13.5. Restoration of Fixtures................................20
14. DEFAULT...........................................................20
14.1. Events Of Default......................................20
(a) Abandonment.......................................20
(b) Nonpayment........................................20
(c) Other Obligations............,....................20
(d) General Assignment................................21
(a) Bankruptcy........................................21
(f) Receivership......................................21
(g) Attachment........................................21
(h) Insolvency........................................21
14.2. Remedies Upon Tenant's Default.........................21
14.3. Remedies Cumulative....................................22
15. SUBORDINATION, ATTORNMENT AND SALE................................22
15.1. Subordination To Mortgage..............................22
15.2. Sale of Landlord's Interest............................23
15.3. Estoppel Certificates..................................23
15.4. Subordination To CC&R's................................23
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16. SECURITY..........................................................23
16.1. Deposit................................................23
17. MISCELLANEOUS.....................................................24
17.1. Notices................................................24
17.2. Successors And Assigns.................................25
17.3. No Waiver..............................................25
17.4. Severability...........................................25
17.5. Litigation Between Parties.............................25
17.6. Surrender..............................................25
17.7. Interpretation.........................................25
17.8. Entire Agreement.......................................25
17.9. Governing Law..........................................26
17.10. No Partnership.........................................26
17.11. Financial Information..................................26
17.12. Costs..................................................26
17.13. Time...................................................26
17.14. Rules And Regulations..................................26
17.15. Brokers................................................26
17.16. Memorandum Of Lease....................................26
17.17. Corporate Authority....................................27
17.18. Parking................................................27
17.19. Signage................................................27
17.20. Stock Warrants.........................................27
EXHIBITS
A Location of Premises
B Real Property Description
C Construction
D Acknowledgement Of Lease Commencement
E Time Line
F Building Standard Specification
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LEASE
THIS LEASE is made and entered into as of the 7th day of March, 1997, by
and between HAYWARD POINT EDEN I LIMITED PARTNERSHIP, a Delaware limited
partnership ("Landlord") and RIBOGENE, INC., a California corporation
("Tenant").
THE PARTIES AGREE AS FOLLOWS:
1. PREMISES
1.1. Premises. Landlord leases to Tenant and Tenant hires and leases from
Landlord, on the terms, covenants and conditions hereinafter set forth, the
premises (the "Premises") designated in Exhibit A attached hereto and
incorporated herein by this reference, consisting of approximately 25,000 square
feet of space located within Building J (the "Building") in the BRITANNIA POINT
EDEN BUSINESS PARK (the "Center") in the City of Hayward, County of Alameda,
State of California, commonly known as ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
The Center occupies the real property described in Exhibit B attached hereto and
incorporated herein by this reference (the "Property"); the Building occupies
Lot 3 of the Property. The Center presently consists of Buildings A, B, C, D, E,
F, G, H and K as shown on Exhibit A attached hereto; Building J is under
construction, and Buildings L, M and N are proposed to be constructed in the
future. Landlord also grants to Tenant, pursuant to this Lease, the
non-exclusive right to use any common areas of the Center as improved from time
to time for such purpose and as designated from time to time in any Declaration
of Covenants, Conditions and Restrictions or similar document affecting the
Property.
1.2. Landlord's Reserved Rights. Landlord reserves the right from time to
time to (i) install, use, maintain, repair and replace pipes, ducts, conduits,
wires and appurtenant meters and equipment for service to other parts of the
Building above the ceiling surfaces, below the floor surfaces, within the walls
or leading through the Premises in locations which will not materially interfere
with Tenant's use thereof, (ii) relocate any pipes, ducts, conduits, wires and
appurtenant meters and equipment included in the Premises which are so located
or located elsewhere outside the Premises, (iii) make alterations or additions
to the Building, (iv) construct, alter or add to other buildings or improvements
on the Property, (v) build adjoining to the Property, and (vi) lease any part of
the Property for the construction of improvements or buildings. Landlord may
modify or enlarge the common area, alter or relocate accesses to the Premises,
or alter or relocate any common facility. Prior to exercising any such rights,
Landlord shall give reasonable advance notice to Tenant (except in case of
emergency, in which event no advance notice shall be required but Landlord shall
use reasonable efforts to notify Tenant as soon as possible), which notice shall
be given not less than five (5) business days prior to entry (except in case of
emergency), shall not be required to be given more than thirty (30) days prior
to entry, and within that range shall precede the entry by a period of time
which is reasonably proportional to the extent of any disruption that Landlord's
entry will cause with respect to Tenant's business activities. Landlord shall
use reasonable diligence in pursuing and completing any work performed under
this Section 1.2. Landlord shall not exercise rights reserved to it pursuant to
this Section 1.2 in such a manner as to materially impair Tenant's ability to
conduct its activities in the normal manner; provided, however, that the
foregoing portion of this sentence shall not limit or restrict Landlord's right
to undertake reasonable construction activity and Tenant's use of the Premises
shall be subject to reasonable temporary disruption incidental to such activity
diligently prosecuted.
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1.3. First Refusal Right. Landlord gives Tenant, on the terms set forth
in this Section 1.3, a First Refusal Right with respect to (a) the adjacent
space of approximately 5,000 square feet in Building J, (b) the existing
Buildings F and D as shown on Exhibit A, and (c) Building M (still to be built)
as shown on Exhibit A. The areas described in clauses (a) through (c) of the
preceding sentence are collectively referred to herein as the "Option Space" and
are designated as such on Exhibit A. If Landlord intends during the term of this
Lease to lease all or any portion of the Option Space to a "New Tenant" (which
term shall mean any person or entity other than the tenant which leases such
portion of the Offered Space on the date hereof, an affiliate of such existing
tenant or a successor in interest to such existing tenant pursuant to a merger,
reorganization, assignment or other similar transaction), and if Tenant is not
then in default under this Lease, Landlord shall give written notice of such
intention to Tenant, specifying the material terms on which Landlord proposes to
lease the Option Space or portion thereof (the "Offered Space") to the New
Tenant, and shall offer to Tenant the opportunity to lease the Offered Space on
the terms specified in Landlord's notice. Tenant shall have ten (10) days after
the date of giving of such notice by Landlord in which to accept such offer by
written notice to Landlord. Upon such acceptance by Tenant, the Offered Space
shall be leased to Tenant on the terms set forth in Landlord's notice and on the
additional terms and provisions set forth herein (except to the extent
inconsistent with the terms set forth in Landlord's said notice) and the parties
shall promptly execute an amendment to this Lease adding the Offered Space to
the Premises and making any appropriate amendments to provisions of this Lease
to reflect different rent and other obligations applicable to the Offered Space
under the terms of Landlord's said notice. If Tenant requests that Landlord
agree to alter the terms for the Offered Space so that Tenant's lease of such
space would be coterminous with the term of this Lease, or requests any other
changes in, the terms specified in Landlord's said notice with respect to the
Offered Space, Landlord agrees to give reasonable consideration to such a
request, but Landlord shall not be obligated to agree to such a request and the
making of such request shall not extend the time period within which Tenant is
required to exercise its rights hereunder. If Tenant does not accept Landlord's
offer within the allotted time, Landlord shall thereafter have the right to
lease the Offered Space to a third party, at any time within one hundred eighty
(180) days after Tenant's failure to accept Landlord's offer, at a minimum
rental and on other terms and conditions not more favorable to the lessee than
the minimum rental and other terms offered to Tenant in Landlord's said notice.
If Tenant does not accept Landlord's offer and Landlord does not lease the
Offered Space to a third party within one hundred eighty (180) days, this First
Refusal Right shall reattach to that space. The intent of the parties with
respect to this Section 1.3 is that with respect to each portion of the Offered
Space that is presently leased to or occupied by an existing tenant, Tenant's
First Refusal Right shall be subject and subordinate to any and all rights now
held by or hereafter granted to such existing tenant (or to any affiliate of or
successor in interest to such tenant), regardless of whether pursuant to such
tenant's existing lease or pursuant to a lease extension or new lease negotiated
in the future, and that Tenant's First Refusal Right shall apply only when
Landlord elects to attempt to lease any portion of the Offered Space to a New
Tenant as defined herein.
2. TERM
2.1. Term.
(a) The term of this Lease shall commence on the earlier to occur
of (i) the date which is five (5) days after the date Landlord notifies Tenant
that Landlord's work pursuant to Section 2.4 and Exhibit C is substantially
complete, or (ii) the date Tenant takes occupancy of the Premises (except as
otherwise provided in Section 2.2), the earlier of such dates being herein
called the "Commencement Date," and shall and on the day immediately preceding
the date 180 Months thereafter, unless sooner terminated or extended (if
applicable) as hereinafter provided. Landlord
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will use its best endeavors to provide occupancy by October 1, 1997.
Notwithstanding the foregoing provisions, a Commencement Date established under
clause (i) of the first sentence of this subsection shall not occur unless and
until a certificate of occupancy has been issued for the Premises by the City of
Hayward, interior finish items to be constructed by Landlord have been completed
to a sufficient extent that the Premises may reasonably be used for their
intended purpose, all building systems (including HVAC, exhaust fans and hoods)
are operational, and all common area improvements on Lot 3 are substantially
complete.
(b) If, at any time after the eighth (8th) anniversary of the
Commencement Date, Landlord is unable to accommodate Tenant's expansion
requirements in accordance with the terms of this subsection, then,
notwithstanding any other provisions of this Lease, Tenant shall have the right
to terminate this Lease by written notice to Landlord, subject to satisfaction
of each of the following conditions: (i) Tenant shall not be in default with
respect to any of its obligations under this Lease at the time such notice is
given; (ii) Tenant's notice of exercise of such right shall be given to Landlord
at least one hundred eighty (180) days prior to the date of requested
termination; and (iii) Tenant shall pay to Landlord in cash, on or before the
termination date specified in Tenant's notice, an amount equal to the sum of (x)
six (6) months' minimum rental at the rate applicable under Section 3.1(a)
hereof for the six (6) months immediately preceding the specified termination
date, plus (y) six (6) months' additional rent at the rate applicable for
Operating Expenses under Article 5 hereof for the six (6) months immediately
preceding the specified termination date. If Tenant fails to comply strictly
with each of the foregoing conditions, any purported exercise of this early
termination right shall be null, void and of no force or effect. For purposes of
this Section 2.1(b), Landlord shall be deemed to be unable to accommodate
Tenant's expansion requirements only if Tenant has given written notice of such
requirements (defined in good faith and in reasonable detail as to the nature,
extent and timing thereof) to Landlord and either (A) Landlord has no space
available in the Center to offer to Tenant to meet such needs within a time
frame reasonably consistent with Tenant's needs as specified in its notice, or
(B) Landlord has such space available but, after reasonable, diligent and good
faith negotiations by both parties, the parties are unable to reach agreement,
within sixty (60) days after Tenant's notice, upon mutually acceptable terms for
the leasing of such space to Tenant, taking into account (among all relevant
factors) Tenant's requirements as specified in its notice, the rental terms and
conditions then prevailing at the Center, and the availability (including rental
terms and timing) of other space elsewhere in the relevant market meeting
Tenant's specified needs.
2.2. Early Possession. For the purpose of setting up Tenant's operation
and systems, Landlord hereby grants permission for Tenant to occupy or use the
Premises prior to the Commencement Date set forth in Section 2.1, which
occupancy or use shall be subject to and upon all of the terms and conditions of
this Lease, excluding the obligation to pay rent and other charges, unless
Landlord and Tenant agree otherwise; provided, however, that such early
possession shall not advance or otherwise affect the Commencement Date or the
termination date set forth in Section 2.1(a); and provided further, that Tenant
shall not interfere with or delay Landlord's contractors by such early
possession and shall indemnify, defend and hold harmless Landlord and its agents
and employees from and against any and all claims, demands, liabilities,
actions, losses, costs and expenses, including (but not limited to) reasonable
attorneys' fees, arising out of or in connection with Tenant's early entry upon
the Premises hereunder.
2.3. Delay In Possession. Landlord agrees to use its best reasonable
efforts to complete the work described in Section 2.4 and Exhibit C promptly,
diligently and within the respective time periods set forth in the timeline
attached hereto as Exhibit E and incorporated herein by this reference, as such
timeline may be modified from time to time by mutual agreement of Landlord and
Tenant, and subject to the effects of any delays caused by or attributable to
Tenant or to any other
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circumstances beyond Landlord's reasonable control (excluding any financial
inability); provided, however, that except to the extent caused by a material
default by Landlord of its obligations set forth in this Lease (including, but
not limited to, its obligations set forth in this Section 2.3 and in Section 2.4
and Exhibit C), Landlord shall not be liable for any damages caused by any delay
in the completion of such work, nor shall any such delay affect the validity of
this Lease or the obligations of Tenant hereunder.
2.4. Construction. The obligation of Landlord to perform work to improve
the Premises for occupancy is set forth in Exhibit C attached hereto and
incorporated herein by this reference. Except as set forth in Exhibit C,
Landlord shall have no responsibilities or obligations with respect to
preparation of the Premises for Tenant's occupancy. Acceptance by Tenant of
possession of the Premises after performance of such work, if any, by Landlord
shall constitute acceptance by Tenant of such work in its then completed
condition and Landlord shall have no further responsibility of any kind or
character for improvement of the Premises or in connection with such work;
provided, however, that within thirty (30) days after the Commencement Date,
Tenant may furnish to Landlord a "punch list" identifying any items or matters
in the Premises which are not constructed in accordance with the plans and
specifications approved under Exhibit C hereto and Landlord shall promptly and
diligently correct all such matters at its sole cost and expense; and provided
further, that notwithstanding anything to the contrary contained herein,
Landlord warrants to Tenant, effective as of the Commencement Date, that (i) the
Building, the interior improvements in the Premises and the improvements in the
common areas on Lot 3 are substantially completed and are free from material
defects in design and construction, (ii) the electrical, mechanical, plumbing,
lighting and HVAC systems, and the loading doors, if any, on the Building are in
good operating condition (to the extent necessary to serve the Premises) and
are free of material defects in design, equipment and/or installation, and (iii)
the interior improvements in the Premises have been constructed in compliance in
all material respects with the plans and specifications developed and approved
pursuant to Exhibit C. If it is determined that the warranty set forth in the
preceding sentence has been violated in any respect, then it shall be the
responsibility of Landlord, after receipt of written notice from Tenant setting
forth with specificity the nature of the violation, to promptly, at Landlord's
sole cost, correct the condition(s) constituting such violation. The foregoing
warranty, however, shall extend only for one (1) year after the Commencement
Date, and Tenant's failure to give written notice of a violation to Landlord
within one (1) year after the Commencement Date shall give rise to a conclusive
presumption that Landlord has complied with all Landlord's obligations under
this Section 2.4 and Exhibit C. TENANT ACKNOWLEDGES THAT THE FOREGOING
WARRANTIES ARE IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT
TO THE PHYSICAL CONDITION OF THE BUILDING AND IMPROVEMENTS TO BE CONSTRUCTED BY
LANDLORD AND THAT LANDLORD MAKES NO OTHER WARRANTIES EXCEPT AS EXPRESSLY SET
FORTH IN THIS LEASE. Notwithstanding the foregoing, Landlord also agrees that if
any construction defects or other problems arise after the expiration of
Landlord's warranties hereunder but at a time when contractor's, manufacturer's
or supplier's warranties remain in effect with respect to the defect or problem,
then at Landlord's election Landlord shall either (A) assign such third-party
warranties to Tenant to the extent necessary to enable Tenant to pursue direct
enforcement thereof or (B) use all reasonable efforts to enforce such warranties
for Tenant's benefit with respect to the applicable defect or problem. Landlord
also agrees to make available to Tenant any operating manuals, training programs
and other forms of information and assistance provided by the contractors,
manufacturers or suppliers with respect to machinery and equipment installed in
the Premises, but Landlord shall not be required to bear any separate charges
imposed by the contractors, manufacturers or suppliers for such manuals,
programs or other forms of information or assistance.
2.5. Acknowledgement Of Lease Commencement. Upon commencement of the term
of this Lease, Landlord and Tenant shall execute a written acknowledgement of
the Commencement Date, date of termination and related
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matters, substantially in the form attached hereto as Exhibit D (with
appropriate insertions), which acknowledgement shall be deemed to be
incorporated herein by this reference.
2.6. Holding Over. If Tenant holds possession of the Premises after the
term of this Lease, with Landlord's written consent, then except as otherwise
specified in such consent, Tenant shall become a tenant from month to month at
125% of the rental and otherwise upon the terms herein specified for the period
immediately prior to such holding over and shall continue in such status until
the tenancy is terminated by either party upon not less than thirty (30) days
prior written notice. If Tenant holds possession of the Premises after the term
of this Lease without Landlord's written consent, then Landlord in its sole
discretion may elect (by written notice to Tenant) to have Tenant become a
tenant either from month to month or at will, at 150% of the rental (prorated on
a daily basis for an at-will tenancy, if applicable) and otherwise upon the
terms herein specified for the period immediately prior to such holding over, or
may elect to pursue any and all legal remedies available to Landlord under
applicable law with respect to such unconsented holding over by Tenant. Tenant
shall indemnify and hold Landlord harmless from any loss, damage, claim,
liability, cost or expense (including reasonable attorneys' fees) resulting from
any delay by Tenant in surrendering the Premises (except with Landlord's prior
written consent), including but not limited to any claims made by a succeeding
tenant by reason of such delay. Acceptance of rent by Landlord following
expiration or termination of this Lease shall not constitute a renewal of this
Lease.
2.7. Option To Extend Term. Tenant shall have the option to extend the
term of this Lease, at the minimum rental set forth in Section 3.1(d) and (e)
and otherwise upon all the terms and provisions set forth herein with respect to
the initial term of this Lease, for up to two (2) additional periods of five
(5) years each, commencing upon expiration of the initial term hereof. Exercise
of such option with respect to the first such extended term shall be by written
notice to Landlord at least six (6) months and not more than eight (8) months
prior to the expiration of the initial term hereof; exercise of such option with
respect to the second extended term, if the first extension option has been duly
exercised, shall be by like written notice to Landlord at least six (6) months
and not more than eight (8) months prior to the expiration of the first extended
term hereof. If Tenant is in default hereunder on the date of such notice or on
the date any extended term is to commence, then the option shall be of no force
or effect, the extended term shall not commence and this Lease shall expire at
the end of the then current term hereof (or at such earlier time as Landlord may
elect pursuant to the default provisions of this Lease). If Tenant properly
exercises one or more extension options under this Section, then all references
in this Lease (other than in this Section 2.7) to the "term" of this Lease shall
be construed to include the extension term(s) thus elected by Tenant. Except as
expressly set forth in this Section 2.7, Tenant shall have no right to extend
the term of this Lease beyond its prescribed term.
3. RENTAL
3.1. Minimum Rental.
(a) Tenant shall pay to Landlord as minimum rental for the
Premises, in advance, without deduction, offset, notice or demand, on or before
the Commencement Date and on or before the first day of each subsequent calendar
month of the term of this Lease, the following amounts per month:
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Months Minimum Rental
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001 - 012 $37,500.00
013 - 024 $37,500.00
025 - 036 $39,000.00
037 - 048 $40,500.00
049 - 060 $42,250.00
061 - 072 $43,750.00
073 - 084 $45,500.00
085 - 096 $47,500.00
097 - 108 $49,250.00
109 - 120 $51,250.00
121 - 132 $53,250.00
133 - 144 $55,500.00
145 - 156 $57,750.00
157 - 168 $60,000.00
169 - 180 $62,500.00
If the obligation to pay minimum rental hereunder commences on other than the
first day of a calendar month or if the term of this Lease terminates on other
than the last day of a calendar month, the minimum rental for such first or
last month of the term of this Lease, as the case may be, shall be prorated
based on the number of days the term of this Lease is in effect during such
month. If an increase in minimum rental becomes effective on a day other than
the first day of a calendar month, the minimum rental for that month shall be
the sum of the two applicable rates, each prorated for the portion of the month
during which such rate is in effect.
(b) The minimum rental amounts specified in this Section 3.1 are
based upon an estimated area of 25,000 square feet for the Premises. If the
actual area of the Premises, when completed, is greater or less than 25,000
square feet, the minimum rentals specified in this Section 3.1 shall be adjusted
proportionately to the change in the area of the Premises, as determined in good
faith by Landlord's architect on the basis of measurement from the exterior
faces of exterior walls, from the centerline of interior demising walls, and
from the drip line of any exterior overhangs.
(C) The minimum rental amounts specified in this Section 3.1 are
based upon an estimated tenant improvement allowance of Sixty Five Dollars
($65.00) per square foot for the work to be performed by Landlord on the
Premises under Section 2.4 and Exhibit C. If Landlord's total direct costs of
such work (including, but not limited to, construction costs, permit fees and
charges, architects', engineers' and other consulting and professional fees and
all other related costs incurred in connection with the design and construction
of the work, including up to $50,000 in fees incurred by Tenant for
architectural, engineering, space planning and other professional services
rendered by professionals approved in writing by Landlord, such approval not to
be unreasonably withheld, in connection with the design of the work to be
performed by Landlord on the Premises) are less than the product of Sixty Five
Dollars ($65.00) times the area of the Premises (in square feet) as determined
in good faith by Landlord's architect on the basis described in Section 3.1(b)
above, then the minimum rental amounts specified in Section 3.1(a) shall be
reduced by an amount equal to one and three-tenths cents ($0.013) per square
foot per month for each One Dollar ($1.00) by which such total direct costs are
less than Sixty-Five Dollars ($65.00) times the area of the Premises in square
feet. If such total direct costs exceed the product of Sixty-Five Dollars
($65.00) times the area of the Premises in square feet, then Landlord will
provide an additional tenant improvement allowance (the "Phase II Improvement
Allowance") up to a maximum of Five Hundred Thousand Dollars ($500,000.00). To
the extent any of the Phase II Improvement Allowance is used (over and above the
initial allowance of $65.00 per square foot), the monthly minimum rent shall be
increased, commencing upon completion of the improvements constructed with the
Phase II Improvement Allowance and continuing until the earlier
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to occur of the Termination Date of the initial term of this Lease or the date
which is ten (10) years after the date of completion of the improvements
constructed with the Phase II Improvement Allowance, by a supplemental rent
payment in an amount equal to the amount necessary to fully amortize the funds
actually expended from the Phase II Improvement Allowance on a monthly level
payment basis, with an imputed return at the rate of fourteen percent (14%) per
annum, over the lesser of ten (10) years or the period of time remaining to the
Termination Date of the initial term of this Lease.
(d) If Tenant properly exercises its right to extend the term of
this Lease pursuant to Section 2.7 hereof, the minimum rental during the first
extended term shall be equal to the fair market rental value of the Premises as
theretofore improved under Section 2.4 and Exhibit C (but specifically excluding
any improvements which Tenant is entitled to remove from the Premises, under the
provisions of Article 7 hereof, upon expiration of this Lease), including any
cost of living adjustments or other rental increase provisions then customary in
the relevant market for comparable commercial leases, determined as of the
commencement of such extended term in accordance with this paragraph. Upon
Landlord's receipt of a proper notice of Tenant's exercise of its option to
extend the term of this Lease, the parties shall have sixty (60) days in which
to agree on the fair market rental (including any applicable rental increase
provisions) for the Premise's (as theretofore improved under Section 2.4 and
Exhibit C, but excluding any improvements which Tenant is entitled to remove
from the Premises, under the provisions of Article 7 hereof, upon expiration of
this Lease) at the commencement of the first extended term for the uses
permitted hereunder. If the parties agree on such fair market rental and rental
increase provisions (if any), they shall execute an amendment to this Lease
stating the amount of the applicable minimum monthly rental and any applicable
rental increase provisions. If the parties are unable to agree on such rental
(including any applicable rental increase provisions) within such sixty (60) day
period, then Tenant shall have the right, exercisable only by written notice to
Landlord within five (5) business days after the expiration of such 60-day
period, to withdraw its notice of exercise, in which case such notice of
exercise shall be of no further force or effect and the then current term of
this Lease shall expire on its scheduled date. If Tenant does not exercise such
withdrawal right, then within fifteen (15) days after the expiration of the
60-day negotiation period each party, at its cost and by giving notice to the
other party, shall appoint a real estate appraiser with at least five (5) years
experience appraising similar commercial properties in the city or county in
which the Property is located or neighboring areas to appraise and set the fair
market rental and any applicable rental increase provisions for the Premises at
the commencement of the first extended term. If either party fails to appoint an
appraiser within the allotted time, the single appraiser appointed by the other
party shall be the sole appraiser. If an appraiser is appointed by each party
and the two appraisers so appointed are unable to agree upon a fair market
rental (and any appropriate rental increase provisions) within thirty (30) days
after the appointment of the second, they shall appoint a third qualified
appraiser within ten (10) days after expiration of such thirty (30) day period;
if they are unable to agree upon a third appraiser, either party may, upon not
less than five (5) days notice to the other party, apply to the Presiding Judge
of the Superior Court for the county in which the Property is located for the
appointment of a third qualified appraiser. Each party shall bear its own legal
fees in connection with appointment of the third appraiser and shall bear
one-half of any other costs of appointment of the third appraiser and of such
third appraiser's fee. The third appraiser, however selected, shall be a person
who has not previously acted for either party in any capacity. Within thirty
(30) days after the appointment of the third appraiser, a majority of the three
appraisers shall set the fair market rental and any applicable rental increase
provisions for the first extended term and shall so notify the parties. If a
majority are unable to agree within the allotted time, (i) the three appraised
fair market rentals shall be added together and divided by three and the
resulting quotient shall be the fair market rental for the first extended term,
and (ii) the applicable rental increase provision shall be equal to the
mathematical average (or the nearest reasonable approximation thereto) of the
two rental increase provisions that are most
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closely comparable, which determinations shall be binding on the parties and
shall be enforceable in any further proceedings relating to this Lease.
(e) If Tenant properly exercises its right to a second extended
term of this Lease pursuant to Section 2.7 hereof, the minimum rental during
such second extended term shall be determined in the same manner provided in the
preceding paragraph for the first extended term, except that the determination
shall be made as of the commencement of the second extended term.
3.2. Late Charge. If Tenant fails to pay when due rental or other amounts
due Landlord hereunder, such unpaid amounts shall bear interest for the benefit
of Landlord at a rate equal to the lesser of fifteen percent (15%) per annum or
the maximum rate permitted by law, from the date due to the date of payment. In
addition to such interest, Tenant shall pay to Landlord a late charge in an
amount equal to five percent (5%) of any installment of minimum rental and any
other amounts due Landlord if not paid in full on or before the fifth (5th) day
after written notice from Landlord that such rental or other amount is overdue;
provided, however, that if any payment of rent or other amounts by Tenant is
more than five (5) days late and Landlord gave written notice of delinquency to
Tenant prior to such payment actually being made, then for the next twelve (12)
calendar months after such written notice was given, Tenant shall be liable for
late charges on any further payment of rental or other amounts that is not paid
on or before the fifth (5th) day after such rental or other amount is due,
without any requirement of prior notice from Landlord to Tenant that such rental
or other amount is due. Tenant acknowledges that late payment by Tenant to
Landlord of rental or other amounts due hereunder will cause Landlord to incur
costs not contemplated by this Lease, including, without limitation, processing
and accounting charges and late charges which may be imposed on Landlord by the
terms of any loan relating to the Property. Tenant further acknowledges that it
is extremely difficult and impractical to fix the exact amount of such costs and
that the late charge set forth in this Section 3.2 represents a fair and
reasonable estimate thereof. Acceptance of any late charge by Landlord shall not
constitute a waiver of Tenant's default with respect to overdue rental or other
amounts, nor shall such acceptance prevent Landlord from exercising any other
rights and remedies available to it. Acceptance of rent or other payments by
Landlord shall not constitute a waiver of late charges or interest accrued with
respect to such rent or other payments or any prior installments thereof, nor of
any other defaults by Tenant, whether monetary or non-monetary in nature,
remaining uncured at the time of such acceptance of rent or other payments.
4. TAXES
4.1. Personal Property. Tenant shall be responsible for and shall pay
prior to delinquency all taxes and assessments levied against or by reason of
all alterations and additions and all other items installed or paid for by
Tenant under this Lease, and the personal property, trade fixtures and all of
the property placed by Tenant in or about the Premises. Upon request by
Landlord, Tenant shall furnish Landlord with satisfactory evidence of payment
thereof. If at any time during the term of this Lease any of said alterations,
additions or personal property, whether or not belonging to Tenant, shall be
taxed or assessed as part of Lot 3 or as part of the entire Property, then such
tax or assessment shall be paid by Tenant to Landlord immediately upon
presentation by Landlord of copies of the tax bills in which such taxes and
assessments are included and shall, for the purposes of this Lease, be deemed to
be personal property taxes or assessments under this Section 4.1.
4.2. Real Property. To the extent the real property taxes and assessments
on the Premises are assessed separately from the remainder of the Property,
Tenant shall be responsible for and shall pay prior to delinquency all such
taxes and assessments levied against the Premises. Upon request by Landlord,
Tenant shall
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furnish Landlord with satisfactory evidence of payment thereof. To the extent
the Premises are taxed or assessed as part of Lot 3 or as part of the entire
Property, such real property taxes and assessments (or, in the case of taxes
assessed as part of the entire Property, the portion thereof reasonably
allocable to Lot 3) shall constitute Operating Expenses (as that term is defined
in Section 5.2 of this Lease) and shall be paid in accordance with the
provisions, of Article 5 of this Lease.
5. OPERATING EXPENSES
5.1. Payment Of Operating Expenses.
(a) Tenant shall pay to Landlord, at the time and in the manner
hereinafter set forth, as additional rental, an amount equal to Eighty Three and
Thirty Three Hundredths percent (83.33%) ("Tenant's Operating Cost Share") of
the Operating Expenses defined in Section 5.2.
(b) Tenant's Operating Cost Share as specified in paragraph (a) of
this Section is based upon an estimated area of 25,000 square feet for the
Premises and upon an aggregate area of 30,000 square feet for the Building. If
the actual area of the Premises (when completed) or of the Building, as
determined in good faith by Landlord's architect on a basis consistent with that
used in measuring other leased premises within the Center, differs from the
assumed numbers set forth above, then Tenant's Operating Cost Share shall be
adjusted to reflect the actual areas so determined.
5.2. Definition Of Operating Expenses. Subject to the exclusions and
provisions hereinafter contained, the term "Operating Expenses" shall mean the
total costs and expenses incurred by or allocable to Landlord for management,
operation and maintenance of the Building and of the common areas located on Lot
3 of the Property, including, without limitation, costs incurred for (i)
insurance premiums, property management, building maintenance, landscaping and
common area maintenance; (ii) all utilities and services; (iii) real and
personal property taxes and assessments or substitutes therefor and new taxes on
landlords in addition to taxes now in effect; (iv) supplies, equipment,
utilities and tools used in management, operation and maintenance (v) capital
improvements to the Building, amortized over a reasonable period, (aa) which
reduce or will cause future reduction of other items of Operating Expenses for
which Tenant is otherwise required to contribute or (bb) of which Tenant has use
or which benefit Tenant (provided that any such improvements under this clause
(bb) are approved in writing by Tenant, are a reasonably necessary repair or
replacement of an existing improvement with one of like kind and quality, or are
improvements of like kind and quality to those generally existing throughout the
Center); and (vi) any other costs allocable to or paid by Landlord, as owner of
the Building, pursuant to the terms of any declarations of covenants, conditions
and restrictions affecting the Property from time to time. Operating Expenses
shall not include any costs attributable to increasing the size of or otherwise
expanding the Building or the cost of the work for which Landlord is required to
pay under Section 2.4 and Exhibit C. The. distinction between items of ordinary
operating maintenance and repair and items of a capital nature shall be made in
accordance with generally accepted accounting principles applied on a consistent
basis. To the extent any items of Operating Expenses are paid by Landlord for
the Property as a whole and are not separately stated for the Building or Lot 3
(such as insurance premiums), a reasonable allocation of such items shall be
made between the Building or Lot 3, as applicable, and the remainder of the
Property to which such items also apply. Notwithstanding any other provisions of
this Section 5.2, Operating Expenses shall not include any of the following:
(A) the cost to repair any defects in design, construction or equipment, to the
extent resulting from or attributable to work undertaken by Landlord or by its
contractors on Landlord's behalf; (B) the cost to investigate and/or remediate
any contamination by hazardous or toxic substances or wastes; (C) any expense
reserves;
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(D) the cost to repair any damage caused by (I) fire, earthquake or other peril
(including, but not limited to, any deductible amounts under any earthquake
insurance coverage maintained by Landlord), or (II) the negligence or willful
misconduct of Landlord, of any other tenant of the Property, or of any of their
respective agents, employees or contractors; (E) any costs to the extent
Landlord has the right and ability, with reasonable diligence, to recover
reimbursement therefor from other parties (such as pursuant to warranties or
insurance); (F) costs of a kind that, with respect to the Premises, Building or
Lot 3, are paid directly by Tenant pursuant to this Lease; (G) leasing
commissions and marketing or promotional expenses relating to the Center or to
the procurement of new tenants for the Center; (H) any costs for labor, except
to the extent directly attributable to the operation and maintenance of the
Premises, the Building or Lot 3, and any costs for overhead or management; and
(I) any costs for new construction, including changes to the common areas of the
Property, except to the extent specifically includable as a capital improvement
under Section 5.2(v)(aa) or (bb) above.
5.3. Determination Of Operating Expenses. On or before the Commencement
Date and during the last month of each calendar year of the term of this Lease
("Lease Year"), or as soon thereafter as practical, Landlord shall provide
Tenant notice of Landlord's estimate of the Operating Expenses for the ensuing
Lease Year or applicable portion thereof. On or before the first day of each
month during the ensuing Lease Year or applicable portion thereof, beginning on
the Commencement Date, Tenant shall pay to Landlord Tenant's Operating Cost
Share of the portion of such estimated Operating Expenses allocable (on a
prorata basis) to such month; provided, however, that if such notice is not
given in the last month of a Lease Year, Tenant shall continue to pay on the
basis of the prior year's estimate, if any, until the month after such notice is
given. If at any time or times it appears to Landlord that the actual Operating
Expenses will vary from Landlord's estimate by more than five percent (5%),
Landlord may, by notice to Tenant, revise its estimate for such year and
subsequent payments by Tenant for such year shall be based upon such revised
estimate.
5.4. Final Accounting For Lease Year.
(a) Within ninety (90) days after the close of each Lease Year, or
as soon after such 90-day period as practicable, Landlord shall deliver to
Tenant a statement of Tenant's Operating Cost Share of the Operating Expenses
for such Lease Year prepared by Landlord from Landlord's books and records,
which statement shall be final and binding on Landlord and Tenant except as
otherwise expressly provided herein. If on the basis of such statement Tenant
owes an amount that is more or less than the estimated payments for such
calendar year previously made by Tenant, Tenant or Landlord, as the case may be,
shall pay the deficiency to the other party within thirty (30) days after
delivery of the statement. Failure or inability of Landlord to deliver the
annual statement within such ninety (90) day period shall not impair or
constitute a waiver of Tenant's obligation to pay Operating Expenses, or cause
Landlord to incur any liability for damages.
(b) Notwithstanding any other provisions of this Section 5.4,
within ninety (90) days after receipt of any statement from Landlord setting
forth actual Operating Expenses and Tenant's Operating Cost Share for any period
(a "Statement"), Tenant shall have the right to audit or review Landlord's books
and records relating to Operating Expenses for the period covered by the
Statement, provided that such audit shall be conducted only during normal
business hours, on not less than ten (10) days prior written notice to Landlord,
and at Tenant's sole cost and expense, except as hereinafter provided. To the
extent that Tenant, on the basis of such audit, disputes any item in the
applicable Statement or in the calculation of Tenant's obligations thereunder,
Tenant shall give Landlord written notice of the disputed items, in reasonable
detail and with reasonable supporting information, within thirty (30) days after
the expiration of Tenant's 90-day audit period. If Landlord and
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Tenant are not able to resolve such dispute by good faith negotiations within
thirty (30) days after Tenant notifies Landlord in writing of the disputed
items, then Tenant may, by written notice to Landlord, request an independent
audit of such books and records. The independent audit of the books and records
shall be conducted by a certified public accountant acceptable to both Landlord
and Tenant or, if the parties are unable to agree, by a "Big Six" accounting
firm designated by Landlord and not then employed by Landlord or Tenant. The
audit shall be limited to the determination of the amount of Operating Expenses
and of Tenant's share thereof for the Lease Year covered by the Statement, and
shall be based on generally accepted accounting principles and tax accounting
principles, consistently applied. If it is determined, by mutual agreement of
Landlord and Tenant or by independent audit, that the amount paid by Tenant for
Operating Expenses for the period covered by the Statement was incorrect, then
the appropriate party shall pay to the other party the deficiency or
overpayment, as applicable, within thirty (30) days after the final
determination of such deficiency or overpayment. All costs and expenses of the
audit shall be paid by Tenant unless the audit shows that Landlord overstated
Operating Expenses for the period covered by the Statement by more than five
percent (5%), in which event Landlord shall pay all costs and expenses of the
audit. Each party agrees to maintain the confidentiality of the findings of any
audit in accordance with the provisions of this Section 5.4.
5.5. Proration. If the Commencement Date falls on a day other than the
first day of a Lease Year or if this Lease terminates on a day other than the
last day of a Lease Year, the amount of Tenant's Operating Cost Share payable
by Tenant applicable to such first and last partial Lease Year shall be prorated
on the basis which the number of days during such Lease Year in which this Lease
is in effect bears to 365. The termination of this Lease shall not affect the
obligations of Landlord and Tenant pursuant to Section 5.4 to be performed after
such termination.
6. UTILITIES
6.1. Payment. Commencing with the Commencement Date and thereafter
throughout the term of this Lease, Tenant shall pay, before delinquency, all
charges for water, gas, heat, light, electricity, power, sewer, telephone, alarm
system, janitorial and other services or utilities supplied to or consumed in or
upon the Premises, including any taxes on such services and utilities. It is the
intention of the parties that all such services shall be separately metered to
the Premises. In the event that any of such services supplied to the Premises
are not separately metered, then the amount thereof shall be an item of
Operating Expenses and shall be paid as provided in Article 5.
6.2. Interruption. There shall be no abatement of rent or other charges
required to be paid hereunder and Landlord shall not be liable in damages or
otherwise for interruption or failure of any service or utility furnished to or
used in the Premises because of accident, making of repairs, alterations or
improvements, severe weather, difficulty or inability in obtaining services or
supplies, labor difficulties or any other cause. Notwithstanding the foregoing
provisions of this Section 6.2, however, in the event of any interruption or
failure of any service or utility to the Premises which is caused in whole or
in part by the negligence or willful misconduct of Landlord or its agents or
employees, which continues for more than forty-eight (48) hours and which
materially impairs Tenant's ability to use the Premises for their intended
purpose hereunder, then Tenant's rental obligations under this Lease shall be
abated in proportion to the extent of the proportional fault of Landlord and its
agents and employees and in proportion to the degree of impairment of Tenant's
use of the Premises. Such abatement, if any, shall be retroactive to the
commencement of the interruption or failure and shall continue until Tenant's
use of the Premises is no longer materially impaired thereby.
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7. ALTERATIONS
7.1. Right To Make Alterations. Tenant shall make no alterations,
additions or improvements to the Premises, other than interior non-structural
alterations costing less than Twenty-Five Thousand Dollars ($25,000.00) in each
instance, without the prior written consent of Landlord. All such alterations,
additions and improvements shall be completed with due diligence in a
first-class workmanlike manner and in compliance with plans and specifications
approved in writing by Landlord (as to alterations, additions or improvements
for which Landlord's prior written consent is required) and all applicable laws,
ordinances, rules and regulations. If Tenant wishes to know in advance whether
it will be required to remove any specific alteration, addition or improvement
upon termination of this Lease, as contemplated in Section 7.2 hereof, then
Tenant may make an express written request for such a determination by Landlord
at the time Tenant requests Landlord's consent to the applicable alteration
addition or improvement (or if no such consent is required hereunder, then at
any time prior to Tenant's actual installation of the applicable alteration,
addition or improvement). If Tenant makes such a written request and Landlord
does not, in response thereto, notify Tenant in writing within ten (10) days
that Landlord intends to require, or at least reserves the right to require,
removal of the applicable alteration, addition or improvement upon termination
of this Lease, then Landlord shall not be entitled to later request such
removal, notwithstanding any contrary provisions in Section 7.2 hereof.
7.2. Title To Alterations. All alterations, additions and improvements
installed by Landlord pursuant to this Lease shall be part of the Building and
the property of Landlord. All alterations, additions and improvements installed
by Tenant, in or about the Premises at Tenant's expense shall remain Tenant's
property during the term of this Lease, and, Tenant shall be entitled to all
depreciation, amortization and other tax benefits with respect thereto, but
Tenant shall not remove any such alterations, additions or improvements without
Landlord's prior written consent and such alterations, additions and
improvements shall become part of the Building and the property of Landlord at
the expiration or termination of this Lease, unless Landlord elects to require
Tenant to remove the same upon such expiration or termination. The foregoing
provisions shall not in any event apply to Tenant's movable furniture, trade
fixtures and personal property not affixed to the Property, all of which items
shall in all events remain Tenant's property and be removable by Tenant at the
expiration or termination of this Lease, subject to Tenant's obligation to
immediately repair any damage caused by installation or removal of such items.
7.3. Tenant Fixtures. Notwithstanding the foregoing, Tenant may install,
remove and reinstall trade fixtures without Landlord's prior written consent,
except that any fixtures which are affixed to the Premises or which affect the
exterior or structural portions of the Building shall require Landlord's written
approval. The foregoing shall apply to Tenant's signs, logos and insignia, all
of which Tenant shall have the right to place and remove and replace solely with
Landlord's prior written consent as to location, size and composition. Tenant
shall immediately repair any damage caused by installation and removal of
fixtures under this Section 7.3.
7.4. No Liens. Tenant shall at all times keep the Premises free from all
liens and claims of any contractors, subcontractors, materialmen, suppliers or
any other parties employed either directly or indirectly by Tenant in
construction work on the Premises. Tenant may contest any claim of lien, but
only if, prior to such contest, Tenant either (i) posts security in the amount
of the claim, plus estimated costs and interest, or (ii) records a bond of a
responsible corporate surety in such amount as may be required to release the
lien from the Premises. Tenant shall indemnify, defend and hold Landlord
harmless against liability, loss, damage, cost and all other expenses,
including, without limitation, reasonable attorneys' fees, arising out of claims
of any lien for work performed or materials or supplies furnished at the request
of Tenant or persons claiming under tenant.
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8. MAINTENANCE AND REPAIRS
8.1. Landlord's Work. Landlord shall repair and maintain or cause to be
repaired and maintained those portions of the Building outside of the Premises,
the common areas of the Property, and the roof, exterior walls and other
structural portions of the Building. The cost of all work performed by Landlord
under this Section 8.1 shall be an Operating Expense hereunder, except to the
extent such work (i) is required due to the negligence of Landlord or any other
tenant of the Building, (ii) is a service to a specific tenant or tenants, other
than Tenant, for which Landlord has received or has the right to receive full
reimbursement, (iii) is a capital expense not includible as an Operating Expense
under Section 5.2 hereof, or (iv) is required due to the negligence or willful
misconduct of Tenant or its agents, employees or invitees (in which event Tenant
shall bear the full cost of such work pursuant to the indemnification provided
in Section 10.6 hereof). Tenant knowingly and voluntarily waives the right to
make repairs at Landlord's expense, or to offset the cost thereof against rent,
under any law, statute, regulation or ordinance now or hereafter in effect.
8.2. Tenant's Obligation for Maintenance.
(a) Good Order, Condition and Repair. Subject to the provisions of
Section 2.4 and Exhibit C hereof, by accepting possession of the Premises,
Tenant acknowledges that the Premises are in good and sanitary order, condition
and repair. Except as provided in Section 8.1 hereof, Tenant at its sole cost
and expense shall keep and maintain in good and sanitary order, condition and
repair the Premises and every part thereof, wherever located, including but not
limited to the signs, interior, the face of the ceiling over Tenant's floor
space, HVAC equipment and related mechanical systems serving the Premises (for
which HVAC equipment and related systems Tenant shall enter into a service
contract with a qualified, licensed [to the extent required by law] person or
entity approved in writing by Landlord, which approval shall not be unreasonably
withheld), all doors, door checks, windows, plate glass, door fronts, exposed
plumbing and sewage and other utility facilities, fixtures, lighting, wall
surfaces, floor surfaces and ceiling surfaces and all other interior repairs,
foreseen and unforeseen, as required. Notwithstanding any other provisions of
this Section 8.2(a), Tenant shall not be required to repair or correct (i)
damage caused by the negligence or willful misconduct of Landlord, of any other
tenant of the Property, or of any of their respective agents, employees or
contractors, (ii) damage caused by fire or other casualty (except to the extent
expressly provided in Article 13 hereof), or (iii) conditions for which Landlord
has the right and ability, with reasonable diligence, to recover substantially
complete reimbursement from other parties (such as pursuant to warranties or
insurance).
(b) Landlord's Remedy. If Tenant, after notice from Landlord,
fails to make or perform promptly any repairs or maintenance which are the
obligation of Tenant hereunder, Landlord shall have the right, but shall not be
required, to enter the Premises and make the repairs or perform the maintenance
necessary to restore the Premises to good and sanitary order, condition and
repair. Immediately on demand from Landlord, the cost of such repairs shall be
due and payable by Tenant to Landlord.
(c) Condition Upon Surrender. At the expiration or sooner
termination of this Lease, Tenant shall surrender the Premises, including any
additions, alterations and improvements thereto, broom clean, in good and
sanitary order, condition and repair, ordinary wear and tear excepted, first,
however, removing all goods and effects of Tenant and all and fixtures and items
required to be removed or specified to be removed at Landlord's election
pursuant to this Lease, and repairing any damage caused by such removal. Tenant
shall not have the right to remove fixtures or equipment if Tenant is in default
hereunder unless Landlord specifically waives this provision in writing. Tenant
expressly waives any and all interest in any
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personal property and trade fixtures not removed from the Premises by Tenant at
the expiration or termination of this Lease, agrees that any such personal
property and trade fixtures may, at Landlord's election, be deemed to have been
abandoned by Tenant, and authorizes Landlord (at its election and without
prejudice to any other remedies under this Lease or under applicable law) to
remove and either retain, store or dispose of such property at Tenant's cost and
expense, and Tenant waives all claims against Landlord for any damages resulting
from any such removal, storage, retention or disposal.
9. USE OF PREMISES
9.1. Permitted Use. Tenant shall use the Premises solely for Office,
Research and Development and Laboratory use, for pilot scale and light
manufacturing and assembly, and for no other purpose.
9.2. [Omitted.]
9.3. No Nuisance. Tenant shall not use the Premises for or carry on or
permit upon the Premises or any part thereof any offensive, noisy or dangerous
trade, business, manufacture, occupation, odor or fumes, or any nuisance or
anything against public policy, nor interfere with the rights or business of any
other tenants or of Landlord in the Building, nor make any other unreasonable
use of the Premises. Tenant shall not do or permit anything to be done in or
about the Premises, nor bring nor keep anything therein, which will in any way
cause the Premises to be uninsurable with respect to the insurance required by
this Lease or with respect to standard fire and extended coverage insurance with
vandalism, malicious mischief and riot endorsements.
9.4. Compliance With Laws. Tenant shall not use the Premises or permit
the Premises to be used in whole or in part for any purpose or use that is in
violation of any applicable laws, ordinances, regulations or rules of any
governmental agency or public authority. Tenant shall keep the Premises equipped
with all safety appliances required by law, ordinance or insurance on the
Premises, or any order or regulation of any public authority because of Tenant's
particular use of the Premises. Tenant shall procure all licenses and permits
required for use of the Premises. Tenant shall use the Premises in strict
accordance with all applicable ordinances, rules, laws and regulations and shall
comply with all requirements of all governmental authorities now in force or
which may hereafter be in force pertaining to the use of the Premises by Tenant,
including, without limitation, regulations applicable to noise, water, soil and
air pollution, and making such nonstructural alterations and additions thereto
as may be required from time to time by such laws, ordinances, rules,
regulations and requirements of governmental authorities or insurers of the
Premises (collectively, "Requirements") because of Tenant's construction of
improvements in or other particular use of the Premises. Any structural
alterations or additions required from time to time by applicable Requirements
because of Tenant's construction of improvements in or other particular use of
the Premises shall, at Landlord's election, either (i) be made by Tenant, at
Tenant's sole cost and expense, in accordance with the procedures and standards
set forth in Section 7.1 for alterations by Tenant, or (ii) be made by Landlord
at Tenant's sole cost and expense, in which event Tenant shall pay to Landlord
as additional rent, within ten (10) days after demand by Landlord, an amount
equal to all reasonable costs incurred by Landlord in connection with such
alterations or additions; provided, however, that to the extent any structural
alterations or additions paid for by Landlord pursuant to this Section 9.4 are
considered "capital improvements" under generally accepted accounting principles
applied on a consistent basis, the cost of such capital improvements shall be
amortized over the remaining term of this Lease (without regard to any then
unexercised extension options) on a monthly level payment basis, with an imputed
return at the rate of fourteen percent (14%) per annum, and the amount of such
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monthly amortization payments shall be paid by Tenant to Landlord as
supplemental rent together with, but in addition to, the rent otherwise provided
in Section 3.1 hereof. The judgment of any court, or the admission by Tenant in
any proceeding against Tenant, that Tenant has violated any law, statute,
ordinance or governmental rule, regulation or requirement shall be conclusive of
such violation as between Landlord and Tenant. Nothing in this Section 9.4 is
intended to limit or impair Landlord's obligation, under Section 2.4 and Exhibit
C, to ensure that, among other things, the improvements constructed by Landlord
pursuant thereto are constructed in compliance with all applicable governmental
codes, laws and regulations in force at the time such improvements are
constructed, and Tenant shall have no obligation to correct any such
noncompliance which is Landlord's responsibility under Section 2.4 and
Exhibit C.
9.5. Liquidation Sales. Tenant shall not conduct or permit to be
conducted any auction, bankruptcy sale, liquidation sale, or going out of
business sale, in, upon or about the Premises, whether said auction or sale be
voluntary, involuntary or pursuant to any assignment for the benefit of
creditors, or pursuant to any bankruptcy or other insolvency proceeding.
9.6. Environmental Matters. Without limiting the generality of Tenant's
obligations set forth in Section 9.4 of this Lease:
(a) Tenant shall not cause or permit any hazardous or toxic
substance or hazardous waste (as defined in any federal, state or local law,
ordinance or regulation applicable to such substances or wastes) to be brought
upon, kept, stored or used on or about the Property without the prior written
consent of Landlord.
(b) Tenant shall comply with all applicable laws, rules,
regulations, orders, permits, licenses and operating plans of any governmental
authority with respect to the receipt, use, handling, generation,
transportation, storage, treatment, release and/or disposal of hazardous or
toxic substances or wastes in the course of or in connection with the conduct of
Tenant's business on the Property, and shall provide Landlord with copies of any
and all permits, licenses, registrations and other similar documents that
authorize Tenant to conduct any such activities in connection with Tenant's use
of the Property.
(c) Tenant shall indemnify, defend and hold Landlord harmless from
and against any and all claims, losses, damages, liabilities, costs, legal fees
and expenses of any sort arising out of or relating to (i) any failure by Tenant
to comply with any provisions of subparagraph (a) or (b) above, or (ii) any
receipt, use handling, generation, transportation, storage, treatment, release
and/or disposal of any hazardous or toxic substances or wastes on or about the
Property in connection with Tenant's use or occupancy of the Property or as a
result of any intentional or negligent acts or omissions of Tenant or of any
agent or employee of Tenant. Nothing in this Section 9.6 shall be construed to
make, Tenant responsible for any environmental conditions caused by third
parties during the term of this Lease, except to the extent such third parties
are agents or employees of Tenant or are on the Property in the course of or in
connection with the conduct of Tenant's business thereon.
(d) Landlord shall indemnify, defend and hold Tenant harmless from
and against any and all claims, losses, damages, liabilities, costs, legal fees
and expenses of any sort arising out of or relating to (i) the presence on the
Property of any hazardous or toxic substances or wastes present on the Property
as of the Commencement Date, and/or (ii) any unauthorized release into the
environment of hazardous or toxic substances or wastes to the extent they result
from the negligence of or willful misconduct or omission by Landlord or its
agents or employees.
(a) The provisions of this Section 9.6 shall survive the
termination of this Lease.
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10. INSURANCE AND INDEMNITY
10.1. Insurance.
(a) Tenant shall procure and maintain in full force and effect at
all times during the term of this Lease, at Tenant's cost and expense,
comprehensive public liability and property damage insurance to protect against
any liability to the public, or to any invitee of Tenant or Landlord, arising
out of or related to the use of or resulting from any accident occurring in,
upon or about the Premises, with limits of liability of not less than (i) One
Million Dollars ($1,000,000.00) for injury to or death of one person, (ii) Three
Million Dollars ($3,000,000.00) for personal injury or death, per occurrence,
and (iii) Five Hundred Thousand Dollars ($500,000.00) for property damage, or a
combined single limit of public liability and property damage insurance of not
less than Five Million Dollars ($5,000,000.00). Such insurance shall name
Landlord and its general partners and Managing Agent as additional insureds
thereunder. The amount of such insurance shall not be construed to limit any
liability or obligations of Tenant under this Lease.
(b) Landlord shall procure and maintain in full force and effect
at all times during the term of this Lease, at Landlord's cost and expense (but
reimbursable as an Operating Expense under Section 5.2 hereof), fire and "all
risk" extended coverage property damage insurance for the Building and interior
improvements that are the property of Landlord and for the improvements in the
common areas of the Property, on a full replacement cost basis, with rental loss
insurance. Such insurance may include earthquake and/or flood coverage to the
extent Landlord in its discretion elects to carry such coverage, and shall have
such commercially reasonable deductibles and other terms as Landlord in its
discretion determines to be appropriate. Landlord shall have no obligation to
carry property damage insurance for any alterations, additions, improvements,
trade fixtures or personal property installed or maintained by Tenant on or
about the Promises.
10.2. Quality of Policies and Certificates. All policies of insurance
required hereunder shall be issued by responsible insurers and shall be written
as primary policies not contributing with and not in excess of any coverage that
Landlord may carry. Tenant shall deliver to Landlord copies of policies or
certificates of insurance showing that said policies are in effect. The coverage
provided by such policies shall include the clause or endorsement referred to in
Section 10.4. If Tenant fails to acquire, maintain or renew any insurance
required to be maintained by it under this Article 10 or to pay the premium
therefor, then Landlord, at its option and in addition to its other remedies,
but without obligation so to do, may procure such insurance, and any sums
expanded by it to procure any such insurance shall be repaid upon demand, with
interest as provided in Section 3.2 hereof. Tenant shall obtain, to the extent
reasonably available, written undertakings from each insurer under policies
required to be maintained by it to notify all insureds thereunder at least
thirty (30) days prior to cancellation, amendment or revision of coverage.
10.3. Workers' Compensation. Tenant shall maintain in full force and
effect during the term of this Lease workers' compensation insurance covering
all of Tenant's employees working on the Premises.
10.4. Waiver of Subrogation. To the extent permitted by law and without
affecting the coverage provided by insurance required to be maintained
hereunder, Landlord and Tenant each waive any right to recover against the other
(i) damages for injury to or death of persons, (ii) damage to property, (iii)
damage to the Premises or any part thereof, or (iv) claims arising by reason of
any of the foregoing, but only to the extent that any of the foregoing damages
and claims under subparts (i)-(iv) hereof are covered, and only to the extent
of such coverage, by insurance actually carried or required to be carried
hereunder by either Landlord or Tenant. This provision is
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intended to waive fully, and for the benefit of each party, any rights and
claims which might give rise to a right of subrogation in any insurance carrier.
Each party shall procure a clause or endorsement on any policy required under
this Article 10 denying to the insurer rights of subrogation against the other
party to the extent rights have been waived by the insured prior to the
occurrence of injury or loss. Coverage provided by insurance maintained by
Tenant under this Article 10 shall not be limited, reduced or diminished by
virtue of the subrogation waiver herein contained.
10.5. Increase In Premiums. Tenant shall do all acts and pay all expenses
necessary to insure that the Premises are not used for purposes prohibited by
any applicable fire insurance, and that Tenant's use of the Premises complies
with all requirements necessary to obtain any such insurance. If Tenant uses or
permits the Premises to be used in a manner which increases the existing rate of
any insurance on the Premises carried by Landlord, Tenant shall pay the amount
of the increase in premium caused thereby, and Landlord's costs of obtaining
other replacement insurance policies, including any increase in premium, within
ten (10) days after demand therefor by Landlord.
10.6. Indemnification.
(a) Tenant shall indemnify, defend and hold Landlord, its
partners, shareholders, officers, directors, affiliates, agents, employees and.
contractors, harmless from any and all liability for injury to or death of any
person, or loss of or damage to the property of any person, and all actions,
claims, demands, costs ( including, without limitation, reasonable attorneys'
fees), damages or expenses of any kind arising therefrom which may be brought or
made against Landlord or which Landlord may pay or incur by reason of the use,
occupancy and enjoyment of the Premises by Tenant or any invitees, sublessees,
licensees, assignees, employees, agents or contractors of Tenant or holding
under Tenant from any cause whatsoever other than negligence or willful
misconduct or omission by Landlord, its agents or employees. Landlord, its
partners, shareholders, officers, directors, affiliates, agents, employees and
contractors shall not be liable for, and Tenant hereby waives all claims against
such persons for, damages to goods, wares and merchandise in or upon the
Premises, or for injuries to Tenant, its agents or third persons in or upon the
Premises, from any cause whatsoever other than negligence or willful misconduct
or omission by Landlord, its agents or employees. Tenant shall give prompt
notice to Landlord of any casualty or accident in, on or about the Premises.
(b) Landlord shall indemnify, defend and hold Tenant, its
partners, shareholders, officers, directors, affiliates, agents, employees and
contractors, harmless from any and all liability for injury to or death of any
person or loss of or damage to the property of any person, and all actions,
claims, demands, costs (including, without limitation, reasonable attorneys'
fees), damages or expenses of any kind arising therefrom which may be brought or
made against Tenant or which Tenant may pay or incur, to the extent such
liabilities or other matters arise by reason of any negligence or willful
misconduct or omission by Landlord, its agents or employees.
10.7. Blanket Policy. Any policy required to be maintained hereunder may
be maintained under a so-called "blanket policy" insuring other parties and
other locations so long as the amount of insurance required to be provided
hereunder is not thereby diminished.
11. SUBLEASE AND ASSIGNMENT
11.1. Assignment And Sublease Of Premises. Tenant shall not have the right
or power to assign its interest in this Lease, or make any sublease, nor shall
any interest of Tenant under this Lease be assignable involuntarily or by
operation of law,
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without on each occasion obtaining the prior written consent of Landlord, which
consent shall not be unreasonably withheld. Any purported sublease or assignment
of Tenant's interest in this Lease requiring but not having received Landlord's
consent thereto shall be void. Any dissolution, consolidation, merger or other
reorganization of Tenant, or any sale or transfer of the stock of or other
interest in Tenant, or any series of one or more of such events, involving in
the aggregate a change of fifty percent (50%) or more in the beneficial
ownership of Tenant or its assets shall be deemed to be an assignment hereunder
and shall be void without the prior written consent of Landlord as required
above. Notwithstanding anything in this Section 11.1 to the contrary, Tenant
may assign this Lease or sublet the Premises, in whole or in part, without
Landlord's consent (but with prior or concurrent written notice to Landlord), to
(a) any subsidiary, division or other entity controlled by, controlling or under
common control with Tenant, or (b) any entity or person which is the successor
to Tenant by merger, consolidation or nonbankruptcy reorganization or which
acquires substantially all of the assets of Tenant's business conducted in the
Premises, provided in each such instance that any such assignee or successor
assumes in full, in writing and for the benefit of Landlord, the obligations of
Tenant under this Lease and that the net worth of the assignee or successor
immediately after the applicable transfer is equal to or greater than that of
Tenant immediately prior to the applicable transfer. In addition, no sale or
transfer of the capital stock of Tenant in connection with any initial public
offering of Tenant's stock or through the facilities of any public securities
exchange shall be deemed to be an assignment, subletting or other transfer of
the Lease, the Premises or any interest therein.
11.2. Rights Of Landlord. Consent by Landlord to one or more assignments
of this Lease, or to one or more sublettings of the Premises, or collection of
rent by Landlord from any assignee or sublessee, shall not operate to exhaust
Landlord's rights under this Article 11, nor constitute consent to any
subsequent assignment or subletting. No assignment of Tenant's interest in this
Lease and no sublease shall relieve Tenant of its obligations hereunder,
notwithstanding any waiver or extension of time granted by Landlord to any
assignee or sublessee, or the failure of Landlord to assert its rights against
any assignee or sublessee, and regardless of whether Landlord's consent thereto
is given or required to be given hereunder. In the event of a default by any
assignee, sublessee or other successor of Tenant in the performance of any of
the terms or obligations of Tenant under this Lease, Landlord may proceed
directly against Tenant without the necessity of exhausting remedies against any
such assignee, sublessee or other successor. In addition, Tenant immediately and
irrevocably assigns to Landlord, as security for Tenant's obligations under this
Lease, all rent from any subletting of all or a part of the Premises as
permitted under this Lease, and Landlord, as Tenant's assignee and as
attorney-in-fact for Tenant, or any receiver for Tenant appointed on Landlord's
application, may collect such rent and apply it toward Tenant's obligations
under this Lease; except that, until the occurrence of an act of default by
Tenant, Tenant shall have the right to collect such rent.
12. RIGHT OF ENTRY AND QUIET ENJOYMENT
12.1. Right of Entry. Landlord and its authorized representatives shall
have the right to enter the Premises at any time during the term of this Lease
during normal business hours and upon not less than twenty-four (24) hours prior
notice, except in the case of emergency, for the purpose of inspecting and
determining the condition of the Premises or for any other proper purpose
including, without limitation, to make repairs, replacements or improvements
which Landlord may deem necessary, to show the Premises to prospective
purchasers, to show the Premises to prospective tenants, and to post notices of
nonresponsibility. In making such entry, Landlord shall comply with any
reasonable security requirements of which Landlord has been advised in writing
by Tenant, and Landlord shall not in any event, except with Tenant's prior
written consent, grant access to the Premises to any person or entity who is
engaged in a business directly competitive with the business of Tenant conducted
on the
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Premises from time to time. Landlord shall not be liable for inconvenience,
annoyance, disturbance, loss of business, quiet enjoyment or other damage or
loss to Tenant by reason of making any repairs or performing any work upon the
Premises and the obligations of Tenant under this Lease shall not thereby be
affected in any manner whatsoever, provided, however, Landlord shall use
reasonable efforts to minimize the inconvenience to Tenant's normal business
operations caused thereby.
12.2. Quiet Enjoyment. Landlord covenants that Tenant, upon paying the
rent and performing its obligations hereunder and subject to all the terms and
conditions of this Lease, shall peacefully and quietly have, hold and enjoy the
Premises throughout the term of this Lease, or until this Lease is terminated as
provided by this Lease.
13. CASUALTY AND TAKING
13.1. Termination Or Reconstruction. If during the term of this Lease the
Premises or Building, or any substantial part of either, (i) is damaged
materially by fire or other casualty or by action of public or other authority
in consequence thereof, (ii) is taken by eminent domain or by reason of any
public improvement or condemnation proceeding, or in any manner by exercise of
the right of eminent domain (including any transfer in avoidance of an exercise
of the power of eminent domain), or (iii) receives irreparable damage by reason
of anything lawfully done under color of public or other authority, this Lease
shall terminate as to the entire Premises at Landlord's election by written
notice given to Tenant within sixty (60) days after the damage or taking has
occurred. If Landlord does not elect to terminate this Lease as hereinabove
provided, Landlord shall repair any such damage and restore the Premises (to the
extent of Landlord's work originally performed therein under Section 2.4 and
Exhibit C) and the Building as nearly as reasonably possible to the condition
existing before the damage or taking; provided, however, that in the event of
any earthquake damage to the Building or Premises, the amount of any repair or
restoration costs representing deductible amounts under any applicable
earthquake insurance shall be borne fifty percent (50%) by Landlord as
Landlord's sole expense and fifty percent (50%) shall be amortized over a ten
(10) year period (regardless of the then remaining term of this Lease) on a
monthly level payment basis, with an imputed return at the rate of fourteen
percent (14%) per annum, and the amount of such monthly amortization payments
for each month remaining in the term of this Lease (including any extensions
duly exercised by Tenant) shall be paid by Tenant to Landlord as supplemental
rent together with, but in addition to, the rent otherwise provided in Section
3.1 hereof. (Landlord hereby advises Tenant that Landlord's existing earthquake
insurance carries a twenty percent (20%) deductible, but that such deductible is
reviewed at least annually and is subject to change.) In the case of damage or
destruction prior to the final year of the term of this Lease, Landlord's
termination right shall be exercisable only if either the time reasonably
estimated by Landlord's architect or contractor to be required for the repair or
restoration of the Building to the extent necessary to permit Tenant to resume
substantially all of its normal business activities therein exceeds one hundred
twenty (120) days from the date of the damage or destruction or the reasonably
estimated cost of such repair or restoration is not covered by insurance
proceeds reasonably available for such repair or restoration under the insurance
required to be maintained by Landlord pursuant to Section 10.1(b) hereof.
13.2. Tenant's Rights. If any portion of the Premises is so taken by
condemnation, Tenant may elect to terminate this Lease if the portion of the
Premises taken is of such extent and nature as substantially to handicap, impede
or permanently impair Tenant's use of the balance of the Premises. Tenant must
exercise its right to terminate by giving notice to Landlord within thirty (30)
days after the nature and extent of the taking have been finally determined. If
Tenant elects to terminate this Lease, Tenant shall also notify. Landlord of the
date of termination, which date shall not be earlier than thirty (30) days nor
later than ninety (90) days after Tenant has
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notified Landlord of its election to terminate, except that this Lease shall
terminate on the date of taking if the date of taking falls on any date before
the date of termination designated by Tenant.
13.3. Lease To Remain In Effect. If neither Landlord nor Tenant terminates
this Lease as hereinabove provided, this Lease shall continue in full force and
effect, except that minimum monthly rental and Tenant's Operating Cost Share
shall ▇▇▇▇▇ to the extent Tenant's use of the Premises is impaired for any
period that any portion of the Premises is unusable or inaccessible because of a
casualty or taking hereinabove described. Each party waives the provisions of
Code of Civil Procedure Section 1265.130, allowing either party to petition the
Superior Court to terminate this Lease in the event of a partial condemnation of
the Premises.
13.4. Reservation Of Compensation. Landlord reserves, and Tenant waives
and assigns to Landlord, all rights to any award or compensation for damage to
the Premises, Building, Property and the leasehold estate created hereby,
accruing by reason of any taking in any public improvement, condemnation or
eminent domain proceeding or in any other manner by exercise of the right of
eminent domain or of anything lawfully done by public authority, except that
Tenant shall be entitled to any and all compensation or damages paid for or on
account of Tenant's moving expenses, trade fixtures, equipment and any leasehold
improvements in the Premises, the cost of which was borne by Tenant, but only to
the extent of the then remaining unamortized value of such improvements computed
on a straight-line basis over the term of this Lease. Tenant covenants to
deliver such further assignments of the foregoing as Landlord may from time to
time request.
13.5. Restoration of Fixtures. If Landlord repairs or causes repair of the
Premises after such damage or taking, Tenant at its sole expense shall repair
and replace promptly all fixtures, equipment and other property of Tenant
located at, in or upon the Premises and all additions, alterations and
improvements and all other items installed or paid for by Tenant under this
Lease that were damaged or taken, so as to restore the same to a condition
reasonably appropriate for the resumption of Tenant's business activities in the
Premises. In so doing, Tenant shall have the right to make modifications to the
previously existing alterations, additions, fixtures and improvements in the
Premises, subject to the prior written approval of Landlord, which shall not be
unreasonably withheld. In its review of Tenant's plans end specifications,
Landlord may take into consideration the effect of the proposed modifications on
the exterior appearance, the structural integrity and the mechanical and other
operating systems of the Building, and shall take into account any reasonable
changes in Tenant's anticipated business operations on the Premises.
14. DEFAULT
14.1. Events Of Default. The occurrence of any of the following shall
constitute an event of default on the part of Tenant:
(a) Abandonment of the Premises. Tenant waives any right Tenant
may have to notice under Section 1951.3 of the California Civil Code, the terms
of this subsection (a) being deemed such notice to Tenant as required by said
Section 1951.3;
(b) Nonpayment. Failure to pay, when due, any amount payable to
Landlord hereunder, such failure continuing for a period of five (5) days after
written notice of such failure;
(c) Other Obligations. Failure to perform any obligation,
agreement or covenant under this Lease other than those matters specified in
subsection (b) hereof, such failure continuing for thirty (30) days after
written notice
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of such failure. If it is not possible to cure such default within thirty (30)
days, Tenant shall commence cure within said thirty (30) day period and shall to
proceed diligently to complete cure;
(d) General Assignment. A general assignment by Tenant for the
benefit of creditors;
(e) Bankruptcy. The filing of any voluntary petition in bankruptcy
by Tenant, or the filing of an involuntary petition by Tenant's creditors, which
involuntary petition remains undischarged for a period of thirty (30) days. In
the event that under applicable law the trustee in bankruptcy or Tenant has the
right to affirm this Lease and continue to perform the obligations of Tenant
hereunder, such trustee or Tenant shall, in such time period as may be permitted
by the bankruptcy court having jurisdiction, cure all defaults of Tenant
hereunder outstanding as of the date of the affirmance of this Lease and provide
to Landlord such adequate assurances as may be necessary to ensure Landlord of
the continued performance of Tenant's obligations under this Lease.
Specifically, but without limiting the generality of the foregoing, such
adequate assurances must include assurances that the Premises continue to be
operated only for the use permitted hereunder. The provisions hereof are to
assure that the basic understandings between Landlord and Tenant with respect to
Tenant's use of the Premises and the benefits to Landlord therefrom are
preserved, consistent with the purpose and intent of applicable bankruptcy laws;
(f) Receivership. The employment of a receiver appointed by court
order to take possession of substantially all of Tenant's assets or the
Premises, if such receivership remains undissolved for a period of thirty (30)
days;
(g) Attachment. The attachment, execution or other judicial
seizure of all or substantially all of Tenant's assets or the Premises, if such
attachment or other seizure remains undismissed or undischarged for a period of
thirty (30) days after the levy thereof; or
(h) Insolvency. The admission by Tenant in writing of its
inability to pay its debts as they become due, the filing by Tenant of a
petition seeking any reorganization or arrangement, composition, readjustment,
liquidation, dissolution or similar relief under any present or future statute,
law or regulation, the filing by Tenant of an answer admitting or failing timely
to contest a material allegation of a petition filed against Tenant in any such
proceeding or, if within thirty (30) days after the commencement of any
proceeding against Tenant seeking any reorganization or arrangement,
composition, readjustment, liquidation, dissolution or similar relief under any
present or future statute, law or regulation, such proceeding shall not have
been dismissed.
14.2. Remedies Upon Tenant's Default.
(a) Upon the occurrence of any event of default described in
Section 14.1 hereof, Landlord, in addition to and without prejudice to any other
rights or remedies it may have, shall have the immediate right to re-enter the
Premises or any part thereof and repossess the same, expelling and removing
therefrom all persons and property (which property may be stored in a public
warehouse or elsewhere at the cost and risk of and for the account of Tenant),
using such force as may be necessary to do so (as to which Tenant hereby waives
any claim for loss or damage that may thereby occur). In addition to or in lieu
of such re-entry, and without prejudice to any other rights or remedies it may
have, Landlord shall have the right either (i) to terminate this Lease and
recover from Tenant all damages incurred by Landlord as a result of Tenant's
default, as hereinafter provided, or (ii) to continue this Lease in effect and
recover rent and other charges and amounts as they become due.
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(b) Even if Tenant has breached this Lease or abandoned the
Premises, this Lease shall continue in effect for so long as Landlord does not
terminate Tenant's right to possession under subsection (a) hereof and Landlord
may enforce all of its rights and remedies under this Lease, including the right
to recover rent as it becomes due, and Landlord, without terminating this Lease,
may exercise all of the rights and remedies of a lessor under California Civil
Code Section 1951.4 (lessor may continue lease in effect after lessee's breach
and abandonment and recover rent as it becomes due, if lessee has right to
sublet or assign, subject only to reasonable limitations), or any successor Code
section. Acts of maintenance, preservation or efforts to relet the Premises or
the appointment of a receiver upon application of Landlord to protect Landlord's
interests under this Lease shall not constitute a termination of Tenant's right
to possession.
(c) If Landlord terminates this Lease pursuant to this Section
14.2, Landlord shall have all of the rights and remedies of a landlord provided
by Section 1951.2 of the Civil Code of the State of California, or any successor
Code section.
14.3. Remedies Cumulative. All rights, privileges and elections or
remedies of Landlord contained in this Article 14 are cumulative and not
alternative to the extent permitted by law and except as otherwise provided
herein.
15. SUBORDINATION, ATTORNMENT AND SALE
15.1. Subordination To Mortgage. This Lease, and any sublease entered into
by Tenant under the provisions of this Lease, shall be subject and subordinate
to any ground lease, mortgage, deed of trust, sale/leaseback transaction or any
other hypothecation for security now or hereafter placed upon the Building, the
Property, or both, and the rights of any assignee of Landlord or mortgagee,
trustee, beneficiary, landlord or leaseback lessor under any of the foregoing,
and to any and all advances made on the security thereof and to all renewals,
modifications, consolidations, replacements and extensions thereof. If any
mortgagee, trustee, beneficiary, ground lessor, sale/leaseback lessor or
assignee elects to have this Lease be an encumbrance upon the Property prior to
the lien of its mortgage, deed of trust, ground lease or leaseback lease or
other security arrangement and gives notice thereof to Tenant, this Lease shall
be deemed prior thereto, whether this Lease is dated prior or subsequent to the
date thereof or the date of recording thereof. Tenant, and any sublessee, shall
execute such documents as may reasonably be requested by any mortgagee, trustee,
beneficiary, ground lessor, sale/leaseback lessor or assignee to evidence the
subordination herein set forth or to make this Lease prior to the lien of any
mortgage, deed of trust, ground lease, leaseback lease or other security
arrangement, as the case may be, and if Tenant fails to do so within ten (10)
days after demand from Landlord, Tenant constitutes and appoints Landlord as
Tenant's attorney-in-fact and in Tenant's name, place and stead to do so. Upon
any default by Landlord in the performance of its obligations under any
mortgage, deed of trust, ground lease, leaseback lease or assignment, Tenant
(and any sublessee) shall attorn to the mortgagee, trustee, beneficiary, ground
lessor, leaseback lessor or assignee thereunder upon demand and shall execute
and deliver any instrument or instruments confirming the attornment herein
provided for. Within thirty (30) days after execution of this Lease, Landlord
shall deliver to Tenant a Non-Disturbance Agreement executed and acknowledged by
SDK Incorporated or any other lender presently holding the beneficial interest
under any deed of trust encumbering the Property, which agreement shall be in a
form reasonably acceptable to Tenant and shall provide that neither this Lease
nor Tenant's possession or other rights hereunder shall be affected, modified or
disturbed by any foreclosure or any assignment by deed in lieu of foreclosure,
so long as Tenant is not then in default hereunder. Similarly, Tenant's
obligation to subordinate this Lease to any future ground lease, mortgage, deed
of trust, sale/leaseback transaction or other hypothecation for security placed
upon the Building, the Property or both shall be
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conditioned on Tenant's receipt from the ground lessor, mortgagee, trustee,
beneficiary or leaseback lessor of a nondisturbance agreement in a form
reasonably acceptable to Tenant, providing that neither this Lease nor Tenant's
possession or other rights hereunder shall be affected, modified or disturbed by
any foreclosure or any assignment by deed in lieu of foreclosure, so long as
Tenant is not then in default hereunder.
15.2. Sale of Landlord's Interest. Upon sale, transfer or assignment of
Landlord's entire interest in the Building and Property, Landlord shall be
relieved of its obligations hereunder with respect to liabilities accruing from
and after the date of such sale, transfer or assignment, but only if and to the
extent that the transferee expressly assumes in writing, for the benefit of
Tenant, Landlord's obligations under this Lease from and after the date of such
sale, transfer or assignment.
15.3. Estoppel Certificates. Either party shall at any time and from time
to time, within ten (10) days after written request by the other party, execute,
acknowledge and deliver to the requesting party a certificate in writing,
stating: (i) that this Lease is unmodified and in full force and effect, or if
there have been any modifications, that this Lease is in full force and effect
as modified and stating the date and the nature of each modification; (ii) the
date to which rental and all other sums payable hereunder have been paid; (iii)
that the requesting party is not in default in the performance of any of its
obligations under this Lease, that the responding party has given no notice of
default to the requesting party and that no event has occurred which, but for
the expiration of the applicable time period, would constitute an event of
default hereunder (or if any such defaults or events exist, specifying the
same); and (iv) such other matters as may reasonably be requested by the
requesting party or any institutional lender, mortgagee, trustee, beneficiary,
ground lessor, sale/leaseback lessor or prospective purchaser of the Property.
Any such certificate provided under this Section 15.3 may be relied upon by any
lender, mortgagee, trustee, beneficiary, assignee or successor in interest to
the requesting party, by any prospective purchaser, by any purchaser on
foreclosure or sale, or upon any grant of a deed in lieu of foreclosure of any
mortgage or deed of trust on the Property or Premises, or by any other third
party. Failure to execute and return within the required time any estoppel
certificate requested hereunder shall be deemed to be an admission of the truth
of the matters set forth in the form of certificate submitted to the requesting
party for execution.
15.4. Subordination To CC&R's. This Lease, and any permitted sublease
entered into by Tenant under the provisions of this Lease, shall be subject and
subordinate (a) to any declarations of covenants, conditions and restrictions
recorded by Landlord with respect to the Property from time to time, provided
that the terms of such declarations are reasonable and do not discriminate
against Tenant relative to other tenants occupying portions of the Property, and
(b) to the Declaration of Covenants, Conditions and Restrictions dated June 20,
1979 and recorded on July 5, 1979 as Instrument No. 79-130777, Alameda County
Records, as amended from time to time (the "Master Declaration"), the provisions
of which Master Declaration are an integral part of this Lease. Tenant agrees to
execute, upon request by Landlord, any documents reasonably required from time
to time to evidence the subordination provided in this Section 15.4.
16. SECURITY
16.1. Deposit. Concurrently with Tenant's execution of this Lease, Tenant
shall deposit with Landlord the sum of Thirty Seven Thousand Five Hundred and
no/100 Dollars ($37,500.00), which sum (the "Security Deposit") shall be held by
Landlord as security for the faithful performance of all of the terms,
covenants, and conditions of this Lease to be kept and performed by Tenant
during the term hereof. If Tenant defaults with respect to any provision of this
Lease, including, without
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27
limitation, the provisions relating to the payment of rental and other sums due
hereunder, Landlord shall have the right, but shall not be required, to use,
apply or retain all or any part of the Security Deposit for the payment of
rental or any other amount which Landlord may spend or may become obligated to
spend by reason of Tenant's default or to compensate Landlord for any other loss
or damage which Landlord may suffer by reason of Tenant's default. If any
portion of the Security Deposit is so used or applied, Tenant shall, within ten
(10) days after written demand therefor, deposit cash with Landlord in an
amount sufficient to restore the Security Deposit to its original amount and
Tenant's failure to do so shall be a material breach of this Lease. Landlord
shall not be required to keep any deposit under this Section separate from
Landlord's general funds, and Tenant shall not be entitled to interest thereon.
If Tenant fully and faithfully performs every provision of this Lease to be
performed by it, the Security Deposit, or any balance thereof, shall be returned
to Tenant or, at Landlord's option, to the last assignee of Tenant's interest
hereunder, at the expiration of the term of this Lease and after Tenant has
vacated the Premises. In the event of termination of Landlord's interest in this
Lease, Landlord shall transfer all deposits then held by Landlord under this
Section to Landlord's successor in interest, whereupon Tenant agrees to release
Landlord from all liability for the return of such deposit or the accounting
thereof.
17. MISCELLANEOUS
17.1. Notices. All notices, consents, waivers and other communications
which this Lease requires or permits either party to give to the other shall be
in writing and shall be deemed given when delivered personally (including
delivery by private courier or express delivery service) or four (4) days after
deposit in the United States mail, registered or certified mail, postage
prepaid, addressed to the parties at their respective addresses as follows:
To Tenant: (until Commencement Date)
RiboGene, Inc.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
(after Commencement Date)
RiboGene, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
To Landlord: Hayward Point Eden I Limited Partnership
c/o Britannia Developments, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇.▇. ▇▇▇▇▇▇▇
with copy to: ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇ LLP
Embarcadero Center West
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
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or to such other address as may be contained in a notice at least fifteen (15)
days prior to the address change from either party to the other given pursuant
to this Section. Rental payments and other sums required by this Lease to be
paid by Tenant shall be delivered to Landlord at Landlord's address provided in
this Section, or to such other address as Landlord may from time to time specify
in writing to Tenant, and shall be deemed to be paid only upon actual receipt.
17.2. Successors And Assigns. The obligations of this Lease shall run with
the land, and this Lease shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns, except that the
original Landlord named herein and each successive Landlord under this Lease
shall be liable only for obligations accruing during the period of its ownership
of the Property, said liability terminating upon termination of such ownership
and passing to the successor lessor.
17.3. No Waiver. The failure of Landlord to seek redress for violation, or
to insist upon the strict performance, of any covenant or condition of this
Lease shall not be deemed a waiver of such violation, or prevent a subsequent
act which would originally have constituted a violation from having all the
force and effect of an original violation.
17.4. Severability. If any provision of this Lease or the application
thereof is held to be invalid or unenforceable, the remainder of this Lease or
the application of such provision to persons or circumstances other than those
as to which it is invalid or unenforceable shall not be affected thereby, and
each of the provisions of this Lease shall be valid and enforceable, unless
enforcement of this Lease as so invalidated would be unreasonable or grossly
inequitable under all the circumstances or would materially frustrate the
purposes of this Lease.
17.5. Litigation Between Parties. In the event of any litigation between
the parties hereto growing out of this Lease, the prevailing party shall be
reimbursed for all reasonable costs, including, but not limited to, reasonable
accountants' fees and attorneys' fees, incurred in connection with such
litigation, any appellate proceedings relating thereto and/or the enforcement of
any judgment entered therein. "Prevailing party" within the meaning of this
Section shall include, without limitation, a party who dismisses an action for
recovery hereunder in exchange for payment of the sums allegedly due,
performance of covenants allegedly breached or consideration substantially equal
to the relief sought in the action.
17.6. Surrender. A voluntary or other surrender of this Lease by Tenant,
or a mutual termination thereof between Landlord and Tenant, shall not result in
a merger but shall, at the option of Landlord, operate either as an assignment
to Landlord of any and all existing subleases and subtenancies, or a termination
of all or any existing subleases and subtenancies. This provision shall be
contained in any and all assignments or subleases made pursuant to this Lease.
17.7. Interpretation. The provisions of this Lease shall be construed as a
whole according to their common meaning and not strictly for or against Landlord
or Tenant. The captions preceding the text of each Section and subsection hereof
are included only for convenience of reference and shall be disregarded in the
construction or interpretation of this Lease.
17.8. Entire Agreement. This written Lease, together with the exhibits
hereto and the side letter executed concurrently herewith regarding certain
additional space in the Building, collectively contain all the representations
and the entire understandings between the parties hereto with respect to the
subject matter hereof. Any prior correspondence, memoranda or agreements are
replaced in total by this Lease, the exhibits hereto and the side letter
described above. This Lease may be modified only by an agreement in writing
signed by each of the parties.
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29
17.9. Governing Law. This Lease and all exhibits hereto shall be construed
and interpreted in accordance with and be governed by all the provisions of the
laws of the State of California.
17.10. No Partnership. Nothing contained in this Lease shall be construed
as creating any type or manner of partnership, joint venture or joint enterprise
with or between Landlord and Tenant.
17.11. Financial Information. From time to time Tenant shall promptly
provide directly to prospective lenders and purchasers of the Premises
designated by Landlord such financial information pertaining to the financial
status of Tenant as Landlord may reasonably request; provided, Tenant shall be
permitted to provide such financial information in a manner which Tenant deems
reasonably necessary to protect the confidentiality of such information. In
addition, from time to time, Tenant shall provide Landlord with such financial
information pertaining to the financial status of Tenant as Landlord may
reasonably request. Landlord agrees that all financial information supplied to
Landlord by Tenant shall be treated as confidential material, and shall not be
disseminated to any party or entity (including any entity affiliated with
Landlord) without Tenant's prior written consent. For purposes of this Section,
without limiting the generality of the obligations provided herein, it shall be
deemed reasonable for Landlord to request copies of Tenant's most recent audited
annual financial statements, or, if audited statements have not been prepared,
unaudited financial statements for Tenant's most recent fiscal year, accompanied
by a certificate of Tenant's chief financial officer that such financial
statements fairly present Tenant's financial condition as of the date(s)
indicated.
Landlord and Tenant recognize the need of Tenant to maintain the
confidentiality of information regarding its financial status and the need of
Landlord to be informed of, and to provide to prospective lenders and purchasers
of the Premises, financial information pertaining to Tenant's financial status.
Landlord and Tenant agree to cooperate with each other in achieving these needs
within the context of the obligations set forth in this Section.
17.12. Costs. If Tenant requests the consent of Landlord under any
provision of this Lease for any act that Tenant proposes to do hereunder,
including, without limitation, assignment or subletting of the Premises, Tenant
shall, as a condition to doing any such act and the receipt of such consent,
reimburse Landlord promptly for any and all reasonable costs and expenses
incurred by Landlord in connection therewith, including, without limitation,
reasonable attorneys' fees.
17.13. Time. Time is of the essence of this Lease, and of every term and
condition hereof.
17.14. Rules And Regulations. Tenant shall observe and obey such rules and
regulations as Landlord may promulgate from time to time for the safety, care,
cleanliness, order and use of the Premises and the Building.
17.15. Brokers. Landlord agrees to pay a brokerage commission to ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇▇ in connection with the consummation of this Lease in accordance with a
separate agreement. Tenant represents and warrants that no other broker
participated in the consummation of this Lease and agrees to indemnify, defend
and hold Landlord harmless against any liability, cost or expense, including,
without limitation, reasonable attorneys' fees, arising out of any claims for
brokerage commissions or other similar compensation in connection with any
conversations, prior negotiations or other dealings by Tenant with any other
broker.
17.16. Memorandum Of Lease. At any time during the term of this Lease,
either party, at its sole expense, shall be entitled to record a memorandum of
this
-26-
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Lease and, if either party so elects, both parties agree to cooperate in the
preparation, execution, acknowledgement and recordation of such document in
reasonable form.
17.17. Corporate Authority. The person signing this Lease on behalf
of Tenant warrants that he or she is fully authorized to do so and by so doing,
to bind Tenant.
17.18. Parking. Landlord will provide at no additional cost to Tenant
parking of no less than 100 spaces on a non-exclusive basis.
17.19. Signage. Landlord shall provide to Tenant, as part of
Landlord's work under Section 2.4 and Exhibit C and chargeable against the
tenant improvement allowance relating to such work, a monument sign in front of
the Premises to conform to existing signage at the Center and to be subject to
any required city approval.
17.20. Stock Warrants. No later than seven (7) days after the
Commencement Date and without written notice from Landlord, as a condition of
Landlord's obligations hereunder, Tenant shall deliver to Landlord, subject to
compliance with all applicable securities laws, a warrant or warrants,
registered in the name(s) of Landlord or its designee(s) and in form and
substance reasonably satisfactory to Landlord, providing for the purchase of an
aggregate of Two Hundred and Fifty Thousand (250,000) shares of Tenant's common
stock. Such warrants shall have an exercise price of Two Dollars and Twenty-Five
Cents ($2.25) per share and shall be exercisable at any time up until the sixth
(6th) anniversary of the Commencement Date; provided, however, that if an
initial public offering of Tenant's common stock has not occurred by May 1,
1998, then the exercise period for the warrants shall be extended until May 1,
2004.
IN WITNESS WHEREOF, the parties hereto have executed this Lease as of
the day and year first set forth above.
"Landlord" "Tenant"
HAYWARD POINT EDEN I LIMITED RIBOGENE, INC., a California
PARTNERSHIP, a Delaware limited corporation
partnership
By: BRITANNIA DEVELOPMENTS, By: /s/
INC., a California corporation, --------------------------------
Its Managing Partner Its:
--------------------------------
By: /s/ ▇. ▇. ▇▇▇▇▇▇▇
---------------------------
▇.▇. ▇▇▇▇▇▇▇
President
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CONSTRUCTION
Landlord, at its sole cost and expense (subject to the rental adjustment
provisions described below), shall undertake and diligently complete, subject to
delays for causes beyond its reasonable control (excluding financial inability),
interior tenant improvements in the Premises in accordance with the Approved
Plans and Specifications (as defined below and as modified from time to time in
accordance with this Exhibit C). Landlord shall use its best endeavors to
complete its work in accordance with the Time Line attached as Exhibit E to this
Lease, as modified from time to time by mutual agreement of Landlord and Tenant.
Landlord's work shall be performed in a neat and workmanlike manner and shall
conform to all applicable governmental codes, laws and regulations in force at
the time such work is completed. Landlord and Tenant shall both use their best
endeavors to develop, review and approve all space plans, working drawings,
final drawings, specifications, changes (if applicable) and other matters within
the time periods set forth in the Time Line attached as Exhibit E to this Lease,
as modified from time to time by mutual agreement of Landlord and Tenant.
As reflected in Section 3.11(c) of this Lease, Landlord has agreed to make
available for the interior improvements in the Premises a basic tenant
improvement allowance of Sixty-Five Dollars ($65.00) per square foot, and a
supplemental "Phase II improvement allowance" of up to Five Hundred Thousand
Dollars ($500,000.00), subject to Tenant's rights to review and approve budget
amounts and bids under this Exhibit C. If any portion of the Phase II
improvement allowance is expended by Landlord, then there shall be a rental
adjustment in accordance with Section 3.1(c). Landlord's total direct costs of
the interior tenant improvements (including, but not limited to, construction
costs, permit fees and charges, architects', engineers' and other consulting and
professional fees, and all other related costs incurred in connection with the
design and construction of the work, including up to $50,000 in fees incurred by
Tenant for architectural, engineering, space planning and other professional
services rendered by professionals approved in writing by Landlord, such
approval not to be unreasonably withheld, in connection with the design of the
work to be performed by Landlord on the Premises) shall be chargeable against
the basic tenant improvement allowance and, to the extent they exceed that
allowance, against the Phase II improvement allowance. If Landlord's total
direct costs of the interior tenant improvements are less than Sixty-Five
Dollars ($65.00) per square foot, then the monthly minimum rent shall be reduced
pursuant to the formula set forth in Section 3.1(c) of the Lease.
The Building Shell of the Building shall be constructed by Landlord at
Landlord's sole cost and expense and shall include a concrete slab floor with a
steel trowel finish, exposed wood frame roof with a built-up roof membrance, and
aluminum storefront with tinted glass. The glass in the five-foot ribbon windows
will be high-performance reflected glass. The electrical room is also included
as part of the Building Shell, including a 2000 Amp main disconnect and house
panel for site and common area lighting. Tenant metering, however, will be
provided as part of the tenant improvements and will be chargeable against the
tenant improvement allowance. The Building Shell also includes overhead fire
sprinklers at the underside of the roof structures. Sprinkler head drops will be
provided as part of the tenant improvements and will be chargeable against the
tenant improvement allowance. The Building Shell is further defined as part of
the "building standard specification" set forth in Exhibit F attached to the
Lease.
The cost of fifty percent (50%) of the demising wall between the Premises
and the adjacent ITT option space shall be part of the tenant improvements and
chargeable against the tenant improvement allowance.
Landlord and its architect, Chamorro Design Group ("CDG"), shall prepare
an initial set of plans and specifications for the interior improvements to the
Premises, to
EXHIBIT C (Page 1 of 2)
32
be mutually approved (such approval not to be unreasonably withheld or delayed)
by Landlord and Tenant (the "Approved Plans and Specifications"), based on
Landlord's Building Standard Specifications as set forth in Exhibit F attached
to this Lease but taking into account Tenant's specific operating requirements
as communicated to Landlord and CDG by Tenant or its professional consultants.
(For purposes of the preceding sentence, Tenant shall have the right to submit
to Landlord and CDG, as part of the design process, documents detailing any
specific operating requirements and needs of Tenant, and Landlord agrees to
cause CDG to take such requirements into consideration, to the extent reasonably
possible, in the preparation of the Approved Plans and Specifications and the
working drawings.) CDG will then produce detailed working drawings, based on the
Approved Plans and Specifications, for submission to the City of Hayward for
building permit approval. Any material changes from the Approved Plans and
Specifications shall be subject to mutual approval (not unreasonably withheld or
delayed) by Landlord and Tenant, provided, however, that any changes required
from time to time in the Approved Plans and Specifications, working drawings
and/or final plans and specifications as a result of applicable law or
governmental requirements, or at the insistence of any other third party whose
approval may be required with respect to such improvements, or as a result of
unanticipated conditions encountered in the course of construction, may be
implemented by Landlord after prior notice to Tenant, but shall not require
Tenant's approval or consent (although Landlord agrees to give reasonable
consideration to Tenant's views regarding functional characteristics of any such
required changes).
The general contractor for the interior tenant improvements shall be
Concrete Shell Structures, Inc., or any other licensed and qualified general
contractor selected by Landlord in its sole discretion. Since the general
contractor's contract will not be competitively bid, Landlord agrees to exercise
reasonable efforts to ensure that the general contractor's markup and other
contract terms are reasonable and competitive in light of market conditions. All
material subcontracts shall be bid to at least three (3) subcontractors. Tenant
shall have the right to submit names of specific subcontractors from which it
would like bids to be invited in particular areas or trades, but such
subcontractors shall be subject to approval (prior to requests for bids) by
Landlord and the general contractor, such approval not to be unreasonably
withheld, and Landlord shall in all events have the right of final approval over
subcontractors. Tenant shall at all times have access to the details of all bids
and estimates for the interior tenant improvements (but not for the building
shell), including (but not limited to) estimates and actual expenses submitted
by the general contractor in connection with the interior tenant improvements,
and the cost aspects of all subcontract bids and estimates for the interior
tenant improvements shall be subject to mutual approval by Landlord and Tenant.
Prior to commencement of construction of interior tenant improvements, all bids,
estimates, budgets and contracts with respect to the interior tenant
improvements shall be available for review by Tenant and, in the case of all
subcontract bids and estimates, for mutual approval by Landlord and Tenant. Cost
aspects of any changes requested by Tenant from time to time in the Approved
Plans and Specifications, working drawings and/or final plans and specifications
shall be subject to mutual approval by Landlord and Tenant; cost aspects of any
changes required from time to time in the Approved Plans and Specifications,
working drawings and/or final plans and specifications as a result of applicable
law or governmental requirements, or at the insistence of any other third party
whose approval may be required with respect to such improvements, or as a result
of unanticipated conditions encountered in the course of construction, shall not
require Tenant's approval or consent, but Tenant shall at all times have access
to the details of the cost aspects of such changes (including estimates and
actual expenses) for informational purposes. Tenant shall have the right to meet
with the general contractor or any subcontractor at any time, on reasonable
notice to Landlord and the general contractor, or on a periodic or regularly
scheduled basis, to review the status of the construction of the interior tenant
improvements, the actual costs to date and the estimated time and costs to
completion.
EXHIBIT C (Page 2 of 2)
33
[LOCATION OF PREMISES MAP]
EXHIBIT A
34
BUILDING STANDARD SPECIFICATION
RIBOGENE BRITANNIA BUSINESS CENTER/PT EDEN III
CDG File #9606.02
2/25/97
5. Insulation:
a. Full thick unfinished ▇▇▇▇▇ in Toilet room walls, Conference walls,
C.F.O., walls and V.P. office walls.
b. R-11 foil faced ▇▇▇▇▇ at all exterior walls of conditioned spaces.
c. R-19 foil faced ▇▇▇▇▇ at roof.
6. HVAC:
a. Gas fired roof top package units.
b. HVAC will be provided in all areas except the following:
Storage
Shipping and receiving
c. The following areas will be provided with gas fired space heater:
Shipping and receiving
Storage
7. Plumbing:
a. See plan for locations.
8. Electrical:
a) Minimum of 3 electrical and one tele/data outlet per room.
b) Lighting in T-bar ceilings shall be 2 X 4 recessed fluorescent fixtures
with flat acrylic lenses. Lighting levels to conform to the latest
Title 24 requirements.
c) Lighting in gyp. bd. ceilings shall be surface mounted wrap around
fluorescent.
d) Lighting in exposed ceiling areas shall be either chain-hung strip
fluorescent on high pressure sodium.
9. Miscellaneous:
a) Plastic laminate lab benches with plastic laminate countertops
(chemical resistant in Chem. and Anal. lab)
b) Fumehoods
CHAMORRO DESIGN GROUP PAGE 3 OF 3
EXHIBIT F (Page 4 of 4)
35
BUILDING STANDARD SPECIFICATION
RIBOGENE BRITANNIA BUSINESS CENTER/PT EDEN III
CDG File #9606.02
2/25/97
TOILET ROOMS/SHOWER:
Floor - Ceramic tile
Base - Ceramic tile
Walls - 4' Ceramic tile wainscot on wet walls
- Gyp. bd.-enamel
Ceiling - Gyp. bd.-enamel
Misc. - Plastic ▇▇▇. countertops
- Metal toilet partitions
- Recessed stainless steel toilet accessories
- Fiberglas shower
JANITOR:
Floor - V.C.T.
Base - Vinyl topset
Walls - 4' marlite wainscot
- Gyp. bd.-enamel
Ceiling - Gyp. bd.=enamel
STORAGE
SHIPPING & RECEIVING:
Floor - Concrete-sealed
Base - Vinyl topset
Walls - Gyp. bd.-Paint
- Concrete-paint
Ceiling - Exposed framing
NOTES:
1. Carpets: 28 oz direct glue down, unless noted otherwise.
2. All finished ceilings at 9'-0'.
3. Door frames and hardware:
a. 3'x7' SC, oakwood veneer, clear finish.
b. Painted aluminum door frames.
c. Schlage "D-series" hardware with lever handles.
4. Fire sprinklers: Semi-recessed heads with white painted escutcheons in
all finished ceilings.
CHAMORRO DESIGN GROUP PAGE 2 OF 3
EXHIBIT F (Page 3 of 4)
36
TIME LINE
(TO BE PROVIDED)
EXHIBIT E
37
RIBOGENE CONSTRUCTION SCHEDULE
PREPARED ON 08 MARCH 97
JAN 97 FEB 97 MAR 97 APR 97 MAY 97 JUNE 97 JULY 97 AUG 97 SEP 97
6 13 20 27 3 10 17 24 3 10 17 24 31 7 14 21 28 5 12 19 26 2 9 16 23 30 7 14 21 28 4 11 18 25 1 8 15 22 29
TENANT IMPROVEMENTS
1 ROUGH M.E.P. UNDERSLAB
SAW CUT FLOORS
INSTALL ROUGH PLUMBING
CONCRETE PATCHING
2 ROUGH M.E.P. @ CEILING
3 FRAME HIGH WALLS
4 DRYWALL @ HIGH WALLS
5 T-BAR GRID
6 FRAME BELOW GRID
7 M.E.P. IN WALLS
8 INSULATE WALLS
9 DRYWALL, TAPE & TOP
10 INTERIOR PAINTING
11 FINISH RESTROOMS
12 FINISH LABS
13 FLOOR COVERINGS
14 CABINETRY
15 FINISH MEP
16 PUNCH LIST
17 MOVE IN
APR 97 MAY 97 JUNE 97 JULY 97 AUG 97 SEP 97
7 14 21 28 5 12 19 26 2 9 16 23 30 7 14 21 28 4 11 18 25 1 8 15 22 29
38
BUILDING STANDARD SPECIFICATION
RIBOGENE
Britannia Pt. Eden Business Center Phase III building structure is a
conventional tilt-up concrete structure. Supported on concrete spread footings,
the floor slab is 5" reinforced concrete over a membrane and engineered fill.
The roof is a panelized wood roof supported by steel columns, girders, and open
web metal joists. The built-up roofing membrane utilizes a 4-ply system with a
mineral surfaced cap sheet.
The building shell and tenant improvements will be separated as follows:
BUILDING SHELL:
- Building envelope
- Exterior concrete walks
- Parking areas
- Landscaping and irrigation
- Roof drains and drain lines
- Fire sprinklers at roof elevation
- Trash enclosures
- Utilities:
- site lighting
- electric transformer
- underground electrical to building pull-section
- gas to exterior meter on building
- telephone conduit to building
- site storm drain system
- main sanitary sewer line under ground floor slab
TENANT IMPROVEMENTS
- Toilet cores
- Interior partitioning
- Interior finishes
- Millwork
- Specialty items, such as skylights
- HVAC system
- Building exhaust system
- Thermal building insulation
- Fire sprinkler drops below roof elevation
- Utilities:
- all electrical beyond pull section including electrical main
disconnect and distribution panels
- gas piping beyond main gas meter
- telephone conduit beyond utility co. termination point
- sanitary sewer lines to main line under ground floor
- lab gas piping all lab utilities, i.e. natural gas, compressed air,
vacuum, etc.
- utility connection fees based on items that are part of tenant
improvements
CHAMORRO DESIGN GROUP
EXHIBIT F (Page 1 of 4)
39
BUILDING STANDARD SPECIFICATION
RIBOGENE BRITANNIA BUSINESS CENTER/PT EDEN III
CDG File #9606.02
2/25/97
INTERIOR MATERIALS/FINISHES
---------------------------
RECEPTION/LOBBY
PRIVATE OFFICES
OPEN OFFICE AREAS
CONFERENCE ROOMS
LIBRARY
CORRIDORS:
Floor - Carpet
Base - Vinyl topset
Walls - Gyp. bd.-paint
Ceiling - Acoustic tiles-2x4 T-bar
LABS
HAX. MAT. STORAGE
NMR
EQUIPMENT, WEIGHING, CHEM. STORAGE
RADIATION
DARK ROOM
COLD ROOM
D.I. WATER
AUTOCLAVE
▇▇▇▇▇
▇▇-2
PLATE POWERING:
Floors - V.C.T
Base - Vinyl topset
Walls - Gyp. bd.-paint
Ceiling - Acoustic tile-2x4 T-bar
LUNCH
KITCHEN STORAGE
RECORD STORAGE
COPY/MAIL
ELECTRICAL:
Floors - V.C.T
Base - Vinyl topset
Walls - Gyp. bd.-paint
Ceiling - Acoustic tile-2x4 T-bar
Misc. - Upper & lower base cabinets, plastic laminate finish,
sink, garbage disposal and dishwasher in Lunch only
CHAMORRO DESIGN GROUP PAGE 1 OF 3
EXHIBIT F (Page 2 of 4)
40
ACKNOWLEDGEMENT OF LEASE COMMENCEMENT
This Acknowledgement is executed as of _____________, 1997, by HAYWARD
POINT EDEN I LIMITED PARTNERSHIP, a Delaware limited partnership ("Landlord"),
and RIBOGENE, INC., a California corporation ("Tenant"), pursuant to Section
2.5 of the Lease dated March 7, 1997 between Landlord and Tenant (the "Lease")
covering premises located at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (the
"Premises").
Landlord and Tenant hereby acknowledge and agree as follows:
1. The Commencement Date under the Lease is _____________, 1997.
2. The termination date under the Lease shall be _____________,
2012, subject to any applicable provisions of the Lease for extension or early
termination thereof.
3. The final cost of the tenant improvements for the Premises is
$__________, of which $__________ constitutes an expenditure of the Phase II
improvement allowance. Based on that cost, the applicable rental adjustment (if
any) required under the Lease is as follows (if none, so state): ______________
_______________________________________________________________________________
______________________________________________________________________________.
4. Tenant accepts the Premises and acknowledges the satisfactory
completion of all improvements therein (if any) required to be made by
Landlord, subject only to any applicable "punch list" or similar procedures
specifically provided under the Lease.
EXECUTED as of the date first set forth above.
"Landlord" "Tenant"
HAYWARD POINT EDEN I LIMITED RIBOGENE, INC., a California
PARTNERSHIP, a Delaware limited corporation
partnership
By: BRITANNIA DEVELOPMENTS, By: __________________________
INC., a California corporation, Its: _________________________
Its Managing Partner
By: __________________________
▇.▇. ▇▇▇▇▇▇▇
President
41
EXHIBITS
--------
EXHIBIT A Location of Premises
EXHIBIT B Real Property Description
EXHIBIT C Construction
EXHIBIT D Acknowledgement of Lease Commencement
EXHIBIT E Time Line
EXHIBIT F Building Standard Specification
42
REAL PROPERTY DESCRIPTION
Real property located in the City of Hayward, County of Alameda, State
of California, more particularly described as follows:
▇▇▇▇ ▇, ▇, ▇, ▇, ▇ ▇▇▇ ▇, ▇▇▇▇▇ ▇▇▇▇, filed June 28, 1979, Map Book
100, Pages 97, 98 and 99, Alameda County Records.
Subject to easements, restrictions and other matters of record
affecting title.
EXHIBIT B